Labor 2 Finals Ful Cases.docx

a. G.R. No. 125561. March 6, 1998] NATIONAL UNION OF WORKERS IN HOTELS, RESTAURANTS AND ALLIED INDUSTRIES (NUWHRAIN) THE PENINSULA MANILA CHAPTER (Interim Union Junta), MELVIN COWAN, SERAFIN TRIA, JR., PORFERIO YAPE, LINDA GALVEZ, BENJAMIN ESTEVES, LUTHER ADIGUE and RAYMUNDO VANCE, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION and THE PENINSULA MANILA, respondents. DECISION REGALADO, J.,: This is a special civil action for certiorari seeking to set aside the decision of public respondent National Labor Relations Commission (NLRC), dated February 7, 1996,[1] which affirmed the November 4, 1993 order of the med-arbiter[2] holding that the strike held by petitioners on October 13 and 14, 1993 was illegal and declaring the 15 officers who knowingly participated in the strike to have lost their employment status. It likewise seeks to set aside the resolution of the NLRC, dated March 28, 1996, [3] denying the motion for reconsideration filed by petitioners. The principal parties involved in this labor dispute are petitioner National Union of Workers in Hotels, Restaurants and Allied Industries (NUWHRAIN)- The Peninsula Manila Chapter (the Junta, for brevity); the NUWHRAIN - The Peninsula Manila Rank and File Chapter (the Union, for short); and private respondent, The Peninsula Manila (hereafter, the Hotel). The rank and file employees union, representing approximately 800 employees of the Hotel, was the herein Union which entered into a collective bargaining agreement (CBA) with the Hotel on December 15, 1991.[4] Petitioners claim that the signing of that CBA by the Union officers, headed by one Rudolpho Genato, and representatives of the Hotel was tainted with irregularities, prompting the Union to file a notice of strike on the ground of a CBA deadlock. It was further asserted that instead of proceeding with said strike, the Union officers and the officers of its national office thereafter mysteriously signed the CBA without consulting the general membership of the local chapter.[5] These anomalies created anxiety in the Union which continued to prevail in the following years. On February, 1993, some of the union members submitted a letter-petition which was to be the first of a series of demands for the resignation of the incumbent union officers on the ground that the latter were purportedly abusive and neglectful of their duties.[6] Because the demands went unheeded, a faction of the Union conducted what was ostensibly an impeachment proceeding, causing the removal from office of the incumbent officers headed by Genato.[7] The faction proclaimed itself as the Interim Union Junta, now the petitioners in this case. Subsequent to the supposed impeachment of Genato and his group, the Junta requested from the Hotel to conduct of a special election of officers. The Hotel referred the request to the NUWHRAIN-LMC-IUF, the Unions national office. The latter disallowed the holding of the election on the ground that it did not recognize the Junta because it was allegedly constituted illegally.[8] The Junta nonetheless conducted the election resulting in the choice of a set of officers led by petitioner Melvin Cowan, but which the supposedly impeached employees, the Unions national office, and the Hotel refused to recognize.[9]

On August 10, 1993, a notice of strike was filed by the Junta before the National Conciliation and Mediation Board (NCMB) based on alleged acts of the Hotel constituting unfair labor practice (ULP), particularly, discrimination, undue interference in the exercise of the right to self-organization, and bias in favor of the impeached officers.[10] The NCMB dismissed said notice on the ground that the imputed ULP acts were mere conflicts between two sets of union officers or intra-union disputes, and being categorized under the nomenclature of non-strikeable acts, fall under the jurisdiction of the appropriate office of the Department of Labor and Employment (DOLE). The NCMB likewise ordered that the notice of strike be reduced to a preventive mediation case to be subjected to conciliation and mediation proceedings.[11] Meanwhile, the Union, headed by Genato, filed a petition for injunction in the DOLE to enjoin the Junta from usurping the functions of the rightful officers. On the other hand, the Hotel filed a petition for interpleader and declaratory relief so that it may be properly guided on which of the two sets of officers, the Genato group or the Cowan group, it should recognize and deal with in matters pertaining to the CBA.[12] Despite the dismissal of the first notice of strike and the pendency of the aforestated conciliation proceedings and cases, the Junta filed a second notice of strike on September 9, 1993.[13] Additional grounds were set forth therein, including the suspension of an alleged Junta officer, one Sammie Coronel, which the Junta claimed constituted an unfair labor practice. This notice of strike was likewise dismissed by the NCMB as the grounds were found to be mere amplifications of those alleged in the preceding notice,[14] hence, likewise non-strikeable. Coronel was eventually dismissed from employment and allegedly because the Junta believed that said dismissal was a ULP act, [15] it staged a wildcat strike on October 13 and 14, 1993, notwithstanding the prohibition to strike issued by the NCMB, thereby disrupting the operations of the Hotel.[16] The 15 officers of the Junta and 153 of its members were involved in the strike. The DOLE Secretary certified the labor dispute to the NLRC for compulsory arbitration.[17] In the meantime, an order was issued by the med-arbiter in the interpleader and injuction cases declaring illegal the formation of the Junta, the impeachment of the union officers led by Genato, and the subsequent election of officers led by Cowan. It acknowledged the incumbency of the Genato group as officers and ordered the Hotel to recognize them as representatives of the rank and file employees.[18] Said order of the med-arbiter was appealed by the Junta to the DOLE Secretary who, as earlier noted, affirmed the same in a resolution dated December 22, 1994. On December 29, 1993, the Hotel filed in the NLRC a petition to declare the wildcat strike illegal and to dismiss the employees who went on strike.[19] On January 13, 1994, the 15 officers of the Junta involved in the strike were dismissed for alleged acts of union disloyalty. Said employees and the Junta then filed a case for illegal dismissal before the NLRC.[20] The NLRC consolidated the foregoing cases and, in a decision dated February 7, 1996, its Second Division declared the strike held on October 13 and 14, 1993 illegal as it was not based on valid grounds pursuant to the ruling of the NCMB when the latter dismissed the two notices of strike filed by the Junta. The NLRC held that the issue involving the suspension and termination from employment of Coronel did not per

se constitute ULP which justifies a strike, as the matter involved purely an exercise of management prerogative which petitioners should have questioned by filing the proper complaint and not by staging a strike.[21] Consequently, the dismissal of the 15 officers of the Junta was declared to be valid. With respect to the 153 members whose illegal acts in the strike were in issue and whose dismissal was likewise sought by the Hotel, the NLRC ordered the remand of the case to the labor arbiter for further proceedings.[22] In a dissent from the decision of the majority, the opinion was advanced that the strike was legal because it was premised on a valid ground, particularly, the belief of the workers in good faith that there existed ULP acts constituting a cause to strike. [23] A motion for reconsideration was filed by the Junta but it was denied,[24] thus the instant petition to set aside the abovementioned NLRC decision and denial resolution. The petitioners contend that public respondent NLRC acted with grave abuse of discretion in declaring the October 13 and 14, 1993 strike illegal and in remanding to the labor arbiter the matter of the alleged illegal acts of the 153 Junta members for further proceedings.[25] This Court has carefully reviewed the records of this case and finds the petition at bar to be unmeritorious. Generally, a strike based on a non-strikeable ground is an illegal strike; corollarily, a strike grounded on ULP is illegal if no such acts actually exist. As an exception, even if no ULP acts are committed by the employer, if the employees believe in good faith that ULP acts exist so as to constitute a valid ground to strike, then the strike held pursuant to such belief may be legal.[26] As a general rule, therefore, where the union believed that the employer committed ULP and the circumstances warranted such belief in good faith, the resulting strike may be considered legal although, subsequently, such allegations of unfair labor practices were found to be groundless.[27] An established caveat, however, is that a mere claim of good faith would not justify the holding of a strike under the aforesaid exception as, in addition thereto, the circumstances must have warranted such belief. It is therefore, not enough that the union believed that the employer committed acts of ULP when the circumstances clearly negate even a prima facie showing to sustain such belief.[28] The Court finds that the NLRC did not commit grave abuse of discretion in ruling that the subject strike was illegal, and accordingly holds that the circumstances prevailing in this case did not warrant, as it could not have reasonably created, a belief in good faith that the Hotel committed acts of ULP as to justify the strike. The dismissal of Coronel which allegedly triggered the wildcat strike [29] was not a sufficient ground to justify that radical recourse on the part of the Junta members. As the NLRC later found, the dismissal was legal and was not a case of ULP but a mere exercise of management prerogative on discipline, the validity of which could have been questioned through the filing of an appropriate complaint and not through the filing of a notice of strike or the holding of a strike.[30] Evidently, to repeat, appropriate remedies under the Labor Code were available to the striking employees and they had the option to either directly file a case for illegal dismissal in the office of the labor arbiter [31] or, by agreement of the parties, to submit the case to the grievance machinery of the CBA so that it may be subjected to voluntary arbitration proceedings.[32]

Petitioners should have availed themselves of these alternative remedies instead of resorting to a drastic and unlawful measure, specifically, holding a wildcat strike at the expense of the Hotel whose operations were consequently disrupted for two days. Not every claim of good faith is justifiable, and herein petitioners claim of good faith shall not be counternanced by this Court since their decision to go on strike was clearly unwarranted. With respect to the claim of petitioners that additional acts of discrimination by the Hotel generated their belief in good faith that ULP acts existed as to justify a strike, the Court deems it unnecessary to again scrutinize and expound the same. The NLRC has already held that the alleged acts of discrimination are not strikeable grounds as found and explained by the NCMB when it dismissed the two notices of strike filed by the Junta.[33] The findings of fact of the NLRC, except where there is grave abuse of discretion committed by it, are conclusive on this Court and it is only where said findings are bereft of any substantial support from the records that the Court will step in and proceed to make its independent evaluation of the facts.[34] The Court finds no cogent reason to disturb the aforestated findings of the NLRC in the present case. Besides, petitioners should have complied with the prohibition to strike ordered by the NCMB when the latter dismissed the notices of strike after finding that the alleged acts of discrimination of the Hotel were not ULP, hence not strikeable. The refusal of petitioners to heed said proscription of the NCMB is reflective of bad faith. In light of the foregoing circumstances, their claim of good faith must fall and we agree with the NLRC that there was no justification for the illegal strike. We accordingly uphold the dismissal from employment of the 15 officers of the Junta who knowingly participated in the strike. An employer may lawfully discharge employees for participating in an unjustifiable wildcat strike and especially so in this case, because said wildcat strike was an attempt to undermine the Unions position as the exclusive bargaining representative and was, therefore, an unprotected activity.[35] The cessation from employment of the 15 Junta officers as a result of their participation in the illegal strike is a consequence of their defiant and capricious decision to participate therein. Finally, petitioners invoke the dissenting opinion in the first challenged NLRC decision, dated February 7, 1996, in support of their stand. Considering the findings of the NLRC which the Court finds no reason to reject, petitioners reliance on the dissent cannot be sustained. Moreover, a dissenting opinion is not binding as it is a mere expression of the individual view of a commissioner who disagrees with the conclusion of the majority of the members of the NLRC division concerned.[36] WHEREFORE, the petition at bar is hereby DISMISSED for lack of any grave abuse of discretion imputable to public respondent. The assailed decision and resolution of respondent National Labor Relations Commission are consequently AFFIRMED. The case is remanded to the labor arbiter a quo for further proceedings on the matter of the 153 members of the Junta who participated in the strike. SO ORDERED. Melo, Puno, Mendoza and Martinez, JJ., concur.

b. G. R. No. L-10095 and L-10115, October 31, 1957 THE PHILIPPINE MARINE RADIO OFFICERS’ ASSOCIATION, PETITIONER VS. THE COURT OR INDUSTRIAL RELATIONS, COMFAÑIA MARITIMA, PHILIPPINE STEAM NAVIGATION CO., MADRIGAL SHIPPING CO., NORTH CAMARINES LUMBER SHIPPING CO., PAN ORIENTAL SHIPPING CO., HIJOS DE F. ESCAÑO, INC., VISAYAN TRANSPORTATION CO., ROYAL LINES, INC., CARLOS A. GOTHONG SHIPPING CO. AND BISAYA LAND TRANSPORTATION CO., RESPONDENTS. COMPAÑIA MARITIMA, PHILIPPINE STEAM NAVIGATION AND MADRIGAL SHIPPING CO., INC., PETITIONERS VS. PHILIPPINE MARINE RADIO OFFICERS’ ASSOCIATION AND COURT OF INDUSTRIAL RELATIONS, ET AL., RESPONDENTS. DECISION LABRADOR, J.: In the above-entitled cases petitioners seek the annulment and or revision of an order of the Court of Industrial Relations concurred in by Judges Lanting, Jimenea Yanson and Martinez, the main provisions of which: (1) direct the return of the strikers, members of the Philippine Marine Radio Operators Association and the different shipping companies parties to the action, (2) but refuse the grant of backpay to them during the period of the strike. The facts that led to the promulgation of the order in question may be briefly stated as follows: On August 28,. 1958, the Philippine Marine Kadio Officers Association (PHILMAROA) presented a list of demand to the Association de Navieros, the Philippine Shipowners’ Association and the Luzon Stevedoring Company, the most important of which are: (1) the standardization and increase of salaries; (2) sick and vacation leave; (3) hospitalization and sick leave; and (4) a closed shop agreement. On September 25, 1953, the Associacion de Navieros informed the Philmaroa that the matter of their petition was referred to the members of the Association, the most important of which were the Compania Maritima and the Philippine Steam Navigation Company. On October 22, 1953, the Philippine Shipowners’ Association, the most important members of which are the Madrigal Shipping Company, the Visayan Transportation Company and the Bisaya Land Transportation, informed the Philmaroa that it could not deal with the latter and requested that the demands be made on the member companies. On September 26, 1953, the Philmaroa also presented the demands with the Bisaya Land Transportation Company and the Royal Steamship Lines. As none of the companies were willing to consider its demands the Philmaroa gave notice of its intention to strike to the different shipping companies and to the Chief, Conciliation Service Division, Department of Labor. This notice to strike was sent on October 17 and October 24. On October 31, 1953 the Chief of the Conciliation Service called the parties for conference. At this conference the Association de Navieros and the Philippine Shipowners’ Association gave the information that they had no authority or power to bargain collectively and suggested that the members of the said association be notified, so the union sent notices to the different companies. After being notified, the respondent companies, on November 7 and November 13, answered, questioning the authority of the Philmaroa to act as representative of the radio operators and demanding that the list

of the members employed who belong to the Philmaroa be furnished them. But the Philmaroa refused to do so for fear of reprisal against its members. The respondent companies also averred that some of them had given salaries over and above that demanded in the standardization, some have given sick and vacation leave and hospitalization, etc. At a conference held on November 13, 1953 before the Conciliation Service Division of the Department of Labor, it was agreed that the respondents be allowed six days of grace within which to act upon or answer the demands made by the Philmaroa. But without the period of six days having expired the Philmaroa declared a strike on November 16, against the Compania Maritima, on November 19, against the Philippine Steam Navigation Company. On February 22, 1954, the President of the Philippines certified the case to the Court of Industrial Relations in accordance with section 10 of Republic Act No. 875. The case was then heard by the’ Court of Industrial Relations with Hon. Jose S. Bautista, presiding. After trial he rendered a decision ordering the respondent companies to reinstate the radio operators on strike, with backpay to their former positions on the vessels under the terms and conditions on August 28, 1953. The judge also granted demand (c) or free hospitalization and sick leave of 15 days every year with pay. All the other demands were denied. Standardization was denied because the cost of operation of the vessels cannot be controlled and not all of the companies are of the same level and the work and cost of living vary among the different vessels. Vacation leave with pay was denied because the court found that many of the respondents did not have the ability to pay. The closed shop agreement was denied because there was no need for it as the nature of the work of radio operators did not need to be the subject of bargaining. Against this decision all the parties appealed the court in bane. Judge V. Jimenez Yanson voted to allow the strikers to go back to their respective positions, but without backpay. He voted to affirm the other portions of the decision denying standardization, vacation leave and closed shop agreement, but granting sick leave, free hospitalization with pay. Judge Martinez concurred in this opinion of Judge Vicente Jimenez Yanson. Judge Lanting concurred also with this decision of Judge Jimenez Yanson, giving the grounds for his concurrence. All the parties to the action have appealed to Us by certiorari from the order of the court in banc. Their appeals shall be considered separately. APPEAL OF THE PHILIPPINE MARINE RADIO OFFICERS’ ASSOCIATION (G. R. No. L-10085) The first error claimed to have been committed by the court a quo in its resolution is in finding that there was no allegation or issue of unfair labor practice before the court, and in concluding that the latter could not, therefore, grant backpay to the employees who were ordered to return back to their work. It is argued by the petitioner that the existence of unfair labor practice was an issue in the case because the Philippine Steam Navigation Company and the other steam companies, in their pleadings and allegations, claim that the strike was illegal because of acts of the union amounting to unfair labor practice, and that under such allegations and pleadings the court had the power and jurisdiction to find that it was the respondents who committed unfair labor practice, as a result of which the strike could not have been illegal. It is argued as a consequence that the finding of the trial judge that the respondents were guilty of unfair

labor practice because they delayed passing upon the demands of petitioners union should be sustained by Us. We agree with the finding of the majority of the court below that there was no unreasonable delay by the respondents in the consideration of the union demands. The demands wurs quite many and varied, involving very fundamental questions that could affect the life of the business of each of the respondents, like increased salaries, standardized salaries, vacation leave with pay, closed shop agreement. It is unreasonable to require the respondents, therefore, to answer the demands in the very short period of time that the case was before the Conciliation Service Division of the Department of Labor. Furthermore, it was agreed at the conference that respondent companies were to be granted six days after November 13, within which to present their answer to the list of demands; but the petitioner union began calling the strikes before the expiration of said period. It is possible under certain circumstances that delay in consideration of demands of a labor union may amount to a refusal to bargain collectively, within the meaning of Section 4, par. 6 of the Industrial Peace Act, but we find that under the circumstances of the case there was no unreasonable delay which would amount to a refusal to bargain within the meaning of said provision. With this holding, it becomes unnecessary to consider the correctness of the resolution appealed from insofar as it declares that no employer may be declared guilty of unfair labor practice without allegation to that effect in the pleadings and opportunity on the part of the employer to deny the same, to contest the charge, and submit evidence in support of the denial. It is also argued before Us that the respondent companies were guilty of unfair labor practice because while the strike was in progress, Case No. 161-ULP was instituted against the Compañia Maritima for having removed or dismissed employee Manuel C. Romero, whom the Court of Industrial Relations ordered returned to his former position. This contention is without merit. The case of Romero was never mentioned as a cause of the strike, and neither is it mentioned as a cause of finding said respondent company or any one of respondents guilty of unfair labor practice. As a matter of fact, the trial judge had not considered the incident of Romero as a cause of unfair labor practice against the Compania Maritima; it was the supposed delaying tactics that were found by the trial judge to constitute the act of unfair labor practice. Furthermore, the decision of the Court of Industrial Relations in the case of Romero did not result in anything except in the reinstatement of Romero. No other matter was decided in that case, hence the petitioner union cannot claim it to be a cause or reason for declaring respondent companies guilty of unfair labor practice in the case now at bar. The second important error assigned in this appeal is the refusal of the majority of the court below to grant backpay. The alleged labor practice imputed to their respondent companies is again used as a ground for granting backpay to the members of the petitioner union, but as we have found above that there was no act on the part of respondent companies amounting to unfair labor practice, this ground for the demand must be rejected. This brings us “to a consideration of that part of the decision that has a relation to the right to backpay. The basic facts are stated in the opinion of the three judges who denied the backpay claim:

“On February 25, 1954, this court issued an order setting: the hearing of the case on March 1, 1954. At the hearing, Atty, Cipriario Cid, then counsel for the petitioner, “was asked several times by the trial Court and by counsel of Compañia Maritima whether he wanted the strikers to be ordered back to work, and his reply was: ‘We have not asked that yet. (p. 15-19 hearing: on March 1, 1954). And when counsel for PSNCO directly asked him if he wanted the strikers to go back to work, his answer in effect was, if ordered by the Court. * * *.” (p. 5, Annex F-1 to Petition.) It is clear from the above that the petitioner union never demanded the privilege to have its members reinstated to their positions immediately, but that they left this matter of their return to the discretion of the court. The court, on the other hand, did net order the return of the strikers; it did so only in its decision after the hearing and termination of the case. Under the circumstances as above indicated it is apparent that the strikers never expressed a desire or willingness to-return back to work, leaving that to the court’s discretion. The denial of backpay to the strikers is clearly justified, in accordance with previous decisions of this Court. It must be taken into account that neither the pleadings, nor the evidence, nor the judgment disclose the existence of any act amounting to discrimination or unfair labor practice. The strike was resorted to by members of the petitioner union as an economic weapon to compel the respondent companies to grant improvement in the pay of the members of the union and in the conditions of their employment. As a matter of fact they expressly wanted closed shop, standardization and increase of salaries as well as vacation leave with pay. At the hearing of the case before the court a quo, counsel for the petitioner union, when asked if the strikers wanted to return back to work, did not say so, but instead expressly declared that the strike was adopted as a weapon to enforce their demands. The strike was by all means, therefore, a voluntary act on the part of the strikers, not one to which they were compelled by reason of any act of discrimination, or unfair labor practice, or refusal of the respondent companies to admit them back to work. The strike may have been legal because it was used as a weapon in the interest of labor; but it was not caused by any illegal or unfair act on the part of the employers, and the strikers should not be entitled to pay during the period they voluntarily absented themselves from work. What we stated in the case of J.P. Heilbrown Company vs. National Labor Union, (92 Phil., 575, 49 Off. Gaz., [2] 547) are exactly applicable : “* * *. The age-old rule governing the relation between labor and capital or management and employee is that of a ‘fair day’s wage for a fair day’s labor.’ T£ there is no work performed by the employee there can be no wage or pay, unless of course, the laborer was able, willing and ready to work but was illegally locked out, dismissed or suspended. It is hardly fair or just for an employee or laborer to fight or litigate against his employer on the employer’s time.” No commission of any unfair labor practice is involved in the case. The grant of backpay is, therefore, to be governed by the general principle of “fair day’s wage for a fair day’s labor.” If even in cases of unfair labor practices the court may be justified in denying backpay (See section 5 (c) of Industrial Peace Act), there is absolutely no reason for granting- backpay if there has not been any unfair labor practice on the part of the respondent companies at all,

For the foregoing considerations the appeal should be denied. APPEAL OF COMPAÑIA MAKITIMA, ET AL. (G. R. No. L-10115) This appeal involves the interpretation of Section 10 of the Industrial Peace Act, which is as follows: “Labor Disputes in Industries indispensable to the National Interest.—When in the opinion of the President of the Philippines there exists a labor dispute in an industry indispensable to the national interest and when such labor dispute is certified by the President to the Court of Industrial Relations, said Court may cause to be issued a restraining order forbidding the employees to strike or the employer to lockout the employees, ponding an investigation by the Court, and if no other solution to the dispute is found, the Court may issue an order fixing the terms and conditions of employment.” It is contended that under the above-quoted provision the Court of Industrial Relations, in a case certified to it by the President of the Philippines under the provisions of the above-quoted section, has no power to order the reinstatement of employees and to grant them backpay. It is argued that the Industrial Peace Act does not prohibit the replacement of stinkers, and if this is so the employer has the right to make replacements during the strike, which replacements may not be nullified by a subsequent order of the Court of Industrial Relations for the return of the strikers. We cannot subscribe to the above contention. We agree with counsel for the Philippine Marine Radio Officers’ Association that upon certification by the President under Section 10 of Republic Act 875, the case comes under the operation of Commonwealth Act 103, which enforces compulsory arbitration in cases of labor disputes in industries indispensable to the national interest when the President certifies the case to the Court of Industrial Relations. The evident intention of the law is to empower the Court of Industrial Relations to act in such cases, not only in the manner pr-escribed under Commonwealth Act 103, but with the same broad powers and jurisdiction granted by that Act. If the Court of Industrial Relations is granted authority to find a solution in an industrial dispute and such solution consists in the ordering of employees to return back to work, it cannot be contended that the Court of Industrial Relations does not have the power or-jurisdiction to carry that solution into effect. And of what use is its power of conciliation and arbitration if it does not have the power and jurisdiction ,to carry into effect the solution it has adopted. Lastly, if the said court has the power to fix the terms and conditions of employment, it certainly can order the return of the workers with or without backpay as a term or condition of the employment. The appeal is, therefore, without merit. For the foregoing considerations, the appeals in the aforesaid cases are hereby dismissed, with costs against the petitioner in G. R. No. L-10095, and the petitioners in G. R. No. L-10115.

c. [ GR No. 156635, Jan 11, 2016 ] HONGKONG v. NLRC + DECISION

BERSAMIN, J.: A strike staged without compliance with the requirements of Article 263 [1] of the Labor Code is illegal, and may cause the termination of the employment of the participating union officers and members. However, the liability for the illegal strike is individual, not collective. To warrant the termination of an officer of the labor organization on that basis, the employer must show that the officer knowingly participated in the illegal strike. An ordinary striking employee cannot be terminated based solely on his participation in the illegal strike, for the employer must further show that the employee committed illegal acts during the strike.

The Case Under appeal is the decision promulgated on January 31, 2002 by the Court of Appeals (CA) in CA-GR. SP No. 56797 entitled The Hongkong & Shanghai Banking Corporation Employees Union, et al. v. National Labor Relations Commission and The Hongkong & Shanghai Banking Corporation, Ltd.,[2] which disposed as follows:

WHEREFORE, the instant petition is DISMISSED and the questioned decision of the National Labor Relations Commission is AFFIRMED with MODIFICATION. Private respondent Hongkong & Shanghai Banking Corporation is ordered to pay each of the following: Isabelo Molo, Elvira Orlina, Samuel Ellarma, Rosario Flores, Rebecca Fajardo, Ma. Victoria Luna, Malou Dizon, Ruben Atienza, Melo Gaba, Nelia Deriada, Fe Esperanza Gerong, Manuel Herrera, Rosalina Juliet Loquellano, Mercedes Paule, Binche Motus, Antonio del Rosario, Francisca del Mundo and Maida Militante:

(a) full backwages from the time of their dismissal in 1993 up to the time this decision becomes final; and (b) separation pay equivalent to one-half (1/2) month salary for every year of service up to 1993. SO ORDERED.[3]

Also under review is the resolution promulgated on December 9, 2002 whereby the CA denied the petitioners' motion for reconsideration.[4]

Antecedents In the period material to this case, petitioner Hongkong & Shanghai Banking Corporation Employees Union (Union) was the duly recognized collective bargaining agent of the rank-and-file employees of respondent Hongkong & Shanghai Banking Corporation (HSBC). A collective bargaining agreement (CBA) governed the relations between the Union and its members, on one hand, and HSBC effective April 1, 1990 until March 31, 1993 for the non-representational (economic) aspect, and effective April 1, 1990 until March 31, 1995 for the representational aspect.[5] The CBA included a salary structure of the employees comprising of grade levels, entry level pay rates and the individual pays depending on the length of service.[6] On January 18, 1993, HSBC announced its implementation of a job evaluation program (JEP) retroactive to January 1, 1993. The JEP consisted of a job designation per grade level with the accompanying salary scale providing for the minimum and maximum pay the employee could receive per salary level.[7] By letter dated January 20, 1993,[8] the Union demanded the suspension of the JEP, which it labeled as an unfair labor practice (ULP). In another letter dated January 22, 1993, the Union informed HSBC that it would exercise its right to concerted action. On the same day of January 22, 1993, the Union members started picketing during breaktime while wearing black hats and black bands on their arms and other appendages.[9] In its letter dated January 25, 1993, HSBC responded by insisting that the JEP was an express recognition of its obligation under the CBA.[10] The Union's concerted activities persisted for 11 months,[11]notwithstanding that both sides had meanwhile started the re-negotiation of the economic provisions of their CBA[12] on March 5, 1993.[13] The continued concerted actions impelled HSBC to suspend the negotiations on March 19, 1993,[14] and to issue memoranda, warnings and reprimands to remind the members of the Union to comply with HSBC's Code of Conduct. Due to the sustained concerted actions, HSBC filed a complaint for ULP in the Arbitration Branch of the National Labor Relations Commission (NLRC), docketed as NLRC-NCR Case No. 00-04-02481-93. The Labor Arbiter's decision was appealed to the NLRC whose disposition to remand the case to the Labor Arbiter for further proceedings was in turn assailed. Ultimately, in G.R. No. 125038 entitled The Hongkong & Shanghai Banking Corporation Employees Union v. National Labor Relations Commission and The Hongkong & Shanghai Banking Corporation, Ltd., the Court affirmed the disposition of the NLRC, and directed the remand of the case to the Labor Arbiter for further proceedings.[15] The Union conducted a strike vote on December 19, 1993 after HSBC accorded regular status to Patrick King, the first person hired under the JEP. The majority of the members

of the Union voted in favor of a strike.[16] The following day, the Union served its letter on HSBC in protest of the continued implementation of the JEP, and insisted that HSBC's modification of the salary structure under the JEP constituted ULP. On December 22, 1993, at around 12:30 p.m., the Union's officers and members walked out and gathered outside the premises of HSBC's offices on Ayala Avenue, Makati and Ortigas Center, Pasig.[17] According to HSBC, the Union members blocked the entry and exit points of the bank premises, preventing the bank officers, including the chief executive officer, from entering and/or leaving the premises.[18]This prompted HSBC to resort to a petition for habeas corpus on behalf of its officials and employees thus prevented from leaving the premises, whom it airlifted on December 24, 1993 to enable them to leave the bank premises.[19] On December 24, 1993, HSBC filed its complaint to declare the strike illegal. [20] The HSBC also petitioned for injunction (with prayer for temporary restraining order (TRO)/writ of prohibitory injunction) in the NLRC, which issued the TRO on January 6, 1994, and the writ of preliminary injunction on January 31, 1994.[21] On November 22, 2001, the Court upheld the actions taken in that case in The Hongkong and Shanghai Banking Corporation Employees Union v. National Labor Relations Commission and The Hongkong and Shanghai Banking Corporation Limited.[22] In the meantime, HSBC issued return-to-work notices to the striking employees on December 22, 1993. Only 25 employees complied and returned to work. Due to the continuing concerted actions, HSBC terminated the individual petitioners on December 27, 1993.[23] The latter, undeterred, and angered by their separation from work, continued their concerted activities.

Ruling of the Labor Arbiter On August 2, 1998, Labor Arbiter (LA) Felipe P. Pati declared the strike illegal for failure of the Union to file the notice of strike with the Department of Labor and Employment (DOLE); to observe the cooling-off period; and to submit the results of the strike vote to the National Conciliation and Mediation Board (NCMB) pursuant to Article 263 of the Labor Code. He concluded that because of the illegality of the strike the Union members and officers were deemed to have lost their employment status. Lie disposed thusly:

WHEREFORE, premises considered, judgment is hereby rendered as follows: 1. The 22 December 1993 strike conducted by the union is hereby declared illegal; 2. The following Union officers and members who participated in the 22 December 1993 strike are hereby deemed to have lost their employment status as of that date, namely: Dalisay Dela Chica, Isabelo Molo, Danilo Alonso, Alvar Rosales, Russel Palma, Imelda

Hernandez, Vicente Llacuna, Josefina Ortiguero, Agustin Iligan, Ma. Asuncion Kimseng, Miguel Sison, Raul Geronimo, Marilou Cadena, Ana Tamonte, Yolanda Enciso, Avelino Relucio, Joralyn Gongora, Corazon Albos, Anabella Gozales, Ma. Corazon Baltazar, Maria Luz Jimenez, Concordio Madayag, Elvira Orlina, Ma. Lourdes Austria, Josephine Landas, Samuel Ellarma, Rosario Flores, Editha Broqueza, Marina Sal vac ion, Ma. Cecilia Ocampo, Rebecca Fajardo, Ma. Victoria Luna, Ma. Theresa Ofelia Galang, Benigno Amion, Mercedes Castro, Gerardo de Leon, Rowena Ocampo, Malou Dizon, Juliet Dacumos, Blandina dela Pena, Ruben Atienza, Ma. Fe Temporal, Mcllo Gaba, Herman Camposanto, Nelia Deriada, Lolito Hilis, Ma. Dulce Abellar, Grace Mabunay, Fe Esperanza Gerong, Romeo Tumlos, Sonia Argos, Manuel Herrera, Joselito Gonzaga, Uldarico Pedida, Cynthia Calangi, Rosalina Loquellano, Marcial Gonzaga, Mercedes Paule, Jess Nicolas, Teodoro Motus, Blanche Motus, Daisy Martinez Fagutao, Antonio del Rosario, Emmanuel Justin Grey, Francisca del Mundo, Juliet Cruz, Rodrigo Durano, Carmina Rivera, David Atanacio, Jr., Ofelia Rabuco, Alfred Tan Jr., Catalina Yee, Menandro Caligaga, Melorio Maida Militante, Antonio Marilon, and Leonila Peres, Emma Mateo, Felipe Vital, Jr., Mario Fermin, and Virgilio Reli; 3. The Union, its officers and members are hereby held jointly and severally liable to pay the Bank the amount of P45,000.00 as actual damages. All the other claims for moral and exemplary damages are denied for lack of merit. SO ORDERED.[24]

Decision of the NLRC On appeal, the NLRC modified the ruling of LA Pati, and pronounced the dismissal of the 18 Union members unlawful for failure of LISBC to accord procedural due process to them, viz.:

xxx [W]e note, however, that as per the submission of the parties, not all the respondents (members) have been identified by complainant as having violated the law on free ingress and egress (i.e., Article 264[e]). A meticulous review of the testimonies given during trial and a comparison of the same show that 25 respondents were not named by complainant's witnesses. Of the 25, 6 of them (Rabuco, Salvacion, Castro, Dacumos, Calangi and Nicolas) have already settled with the complainant during the pendency of the appeal. Of the remaining 19, one respondent is a union officer (Rivera) while the remaining 18 respondents (Molo, Orlina, Ellarma, Flores, Fajardo, Luna, Dizon, Atienza, Gaba, Deriada, Gerong, Herrera, Loquellano, Paule, Motus, Del Rosario, Mundo and Militante) are neither officers nor members who have been pinpointed as having committed illegal act[s]. We, therefore, disagree with the Labor Arbiter's generalization that these 18 respondents have similarly lost their employment status simply because they participated in or acquiesced to the holding of the strike.

xxxx Only insofar as the xxx 18 respondents are concerned, We rule that complainant did fail to give them sufficient opportunity to present their side and adequate opportunity to answer the charges against them. More was expected from complainant and its observance of due process may not be dispensed with no matter how brazen and blatant the violation or its rules and regulations may have perceived. The twin requirement of notice and hearing in termination cases are as much indispensable and mandatory as the procedural requirements enumerated in Article 262 of the Labor Code. In this case, We cannot construe complainant's notice to return-to-work as substantial compliance with due process requirement. Contrary however to respondents' insistence that complainant failed to observe due process in the case of the 18 respondents does not mean that they are automatically entitled to backwages or reinstatement. Consistent with decided cases, these respondents are entitled only to indemnity for complainant's omission, specifically to the amount of P5,000.00 each, xxx As a final word, and only as regard these 18 respondents, We take note of the fact that they have remained silent spectators, if not mere bystanders, in the illegal strike and illegal acts committed by the other individual respondents, and since the grounds for which they have been terminated do not involve moral turpitude, the consequences for their acts must nevertheless be tempered with some sense of compassion. Consistent with prevailing jurisprudence and in the interest of social justice, We find the award of separation pay to each of the 18 respondents equivalent to one-half (1/2) month salary for every year of service as equitable and proper. XXXX WHEREFORE, the decision dated 26 August 1998 is hereby AFFIRMED with the modification that complainant is ordered to pay (a) P5,000.00 and (b) one-half (1/2) month salary for every year of service up to December 1993 to each of the following respondents: Isabelo Molo, Elvira Orlina, Samuel Ellarma, Rosario Flores, Rebecca Fajardo, Ma. Victoria Luna, Malou Dizon, Ruben Atienza, Melo Gaba, Nelia Deriada, Fe Esperanza Gerong, Manuel Herrera, Rosalina Juliet Loquellano, Mercedes Paule. Binche Motus, Antonio del Rosario, Francisca del Mundo and Maida Militante. SO ORDERED.[25] The petitioners filed their motion for reconsideration, but the NLRC denied their motion.[26]

Judgment of the CA

On certiorari, the CA, through the assailed judgment promulgated on January 31, 2002,[27] deleted the award of indemnity, but ordered HSBC to pay baekwages to the 18 employees in accordance with Serrano v. National Labor Relations Commission,[28] to wit:

In Ruben Serrano v. NLRC and Isetcmn Department Store xxx, the Court ruled that an employee who is dismissed, whether or not for just or authorized cause but without prior notice of his termination, is entitled to full baekwages from the time he was terminated until the decision in his case becomes final, when the dismissal was for cause; and in case the dismissal was without just or valid cause, the backwages shall be computed from the time of his dismissal until his actual reinstatement. In the case at bar, where the requirement of notice and hearing was not complied with, the aforecited doctrine laid down in the Serrano case applies.[29] On motion for reconsideration, the CA reiterated its judgment, and denied HSBC's motion to delete the award of backwages.[30] Hence, this appeal by petition for review on certiorari. Pending the appeal, petitioners Elvira A. Orlina, Rosario A. Flores, Ma. Victoria C. Luna, Malou Dizon, Fe Esperanza Gerong, Francisca del Mundo, and Ruben Atienza separately presented motions to withdraw as petitioners herein by virtue of their having individually executed compromise agreements/quitclaims with HSBC.[31] The Court granted all the motions to withdraw;[32] hence, this adjudication relates only to the remaining petitioners.

Issues The remaining petitioners raise the following grounds in support of their appeal, namely:

I THE COURT OF APPEALS COMMITTED SERIOUS ERROR OF LAW IN HOLDING THAT ALL THE PETITIONERS WERE VALIDLY DISMISSED

A The Court of Appeals cannot selectively apply the right to due process in determining the validity of the dismissal of the employee

B

The refusal to lift the strike upon orders of the HSBC is not just cause for the dismissal of the employees

C The HSBC is liable for damages for having acted in utter bad faith by dismissing the petitioners after having previously submitted the dispute to the NLRC

D Union officers who did not knowingly participate in the strike do not lose their employment status

E The responsibility for illegal acts committed in the course of a strike is individual and not collective

F The January 5, 1994 incident does not warrant the dismissal of the petitioners involved thereat

G The penalty, if any, imposable on union officers should be suspension and not dismissal

II THE COURT OF APPEALS COMMITTED SERIOUS ERROR OF LAW IN HOLDING THAT THE STRIKE WAS ILLEGAL A The test of good faith laid down by this Honorable Court is whether the union is of the reasonable belief that the management was committing an unfair labor practice

B The decision as to when to declare the strike is wholly dependent on the union, and the same cannot negate good faith

C

The Court of Appeals committed grave error in concluding that this Court had already ruled on the validity of the implementation of the Job Evaluation Program and no longer considered the evidence presented by petitioners to establish unfair labor practice on the part of the HSBC

D The doctrine automatically making a strike illegal due to non-compliance with the mandatory procedural requirements needs to be revisited The petitioners argue that they were illegally dismissed; that the CA erred in selectively applying the twin notice requirement; that in the case of the Union officers, there must be a prior showing that they had participated in the illegal strike before they could be terminated from employment, but that HSBC did not make such showing, as, in fact, petitioners Carmina C. Rivera and Mario T. Fermin were on leave during the period of the strike;[33] that they could not be dismissed on the ground of insubordination or abandonment in view of participation in a concerted action being a guaranteed right; that their participation in the concerted activities out of their sincere belief that HSBC had committed ULP in implementing the JEP constituted good faith to be appreciated in their favor; that their actions merited only their suspension at most, not the extreme penalty of dismissal; and that the prevailing rule that non-compliance with the procedural requirements under the Labor Code before staging a strike would invalidate the strike should be revisited because the amendment under Batas Pambansa Blg. 227 indicated the legislative intent to ease the restriction on the right to strike. HSBC counters that the appeal raises factual issues already settled by the CA, NLRC, and the LA, rendering such issues inappropriate for determination in this appeal; that it was not liable for illegal dismissal because the petitioners had willfully staged their illegal strike without prior compliance with Article 263 of the Labor Code;[34] that the procedural requirements of Article 263 of the Labor Code were mandatory and indispensable conformably with Article 264[35] of the Labor Code, which, in relation to Article 263(c), (d) and (f), expressly made such non-compliance a prohibited activity; that for this reason Article 264 penalized the Union officers who had participated in the illegal strike with loss of their employment status;[36] that good faith could not be accorded to the petitioners because aside from the non-compliance with the mandatory procedure, they did not present proof to show that the strike had been held for a lawful purpose, or that the JEP had amounted to ULP, or that they had made a sincere effort to settle the disagreement;[37] and that as far as the 18 employees were concerned, they were entitled only to nominal damages, not backwages, following the ruling in Agabon v. National Labor Relations Commission[38] that meanwhile modified the doctrine in Serrano v. National Labor Relations Commission.[39] Two main issues to be resolved are, therefore, namely: (1) whether the strike commenced on December 22, 1993 was lawfully conducted; and (2 whether the petitioners were illegally dismissed.

Ruling of the Court We PARTLY GRANT the petition for review on certiorari.

I Non-compliance with Article 263 of the Labor Code renders a labor strike illegal The right to strike is a constitutional and legal right of all workers because the strike, which seeks to advance their right to improve the terms and conditions of their employment, is recognized as an effective weapon of labor in their struggle for a decent existence. However, the right to strike as a means for the attainment of social justice is never meant to oppress or destroy the employers. Thus, the law prescribes limits on the exercise of the right to strike.[40] Article 263 of the Labor Code specifies the limitations on the exercise of the right to strike, viz.:

Article 263. Strikes, picketing, and lockouts, x x x xxxx (c) In cases of bargaining deadlocks, the duly certified or recognized bargaining agent may file a notice of strike or the employers may file a notice of lockout with the [Department] at least 30 days before the intended date thereof. In cases of unfair labor practices, the period of notice shall be 15 days and in the absence of a duly certified or recognized bargaining agent, the notice of strike may be filed by any legitimate labor organization in behalf of its members. However, in case of dismissal from employment of union officers duly elected in accordance with the union constitution and by-laws, which may constitute union busting, where the existence of the union is threatened, the 15-day cooling off period shall not apply and the union may take action immediately. (d) The notice must be in accordance with such implementing rules and regulations as the [Secretary] of Labor and Employment may promulgate. (e) During the cooling-off period, it shall be the duty of the [Department] to exert all efforts at mediation and conciliation to effect a voluntary settlement. Should the dispute remain unsettled until the lapse of the requisite number of clays from the mandatory filing of the notice, the labor union may strike or the employer may declare a lockout. (f) A decision to declare a strike must be approved by a majority of the total union membership in the bargaining unit concerned, obtained by secret ballot in meetings or

referenda called for that purpose. A decision to declare a lockout must be approved by a majority of the board of directors of the corporation or association or of the partners in a partnership, obtained by secret ballot in a meeting called for that purpose. The decision shall be valid for the duration of the dispute based on substantially the same grounds considered when the strike or lockout vote was taken. The [Department] may, at its own initiative or upon request of any affected party, supervise the conduct of the secret balloting. In every case, the union or the employer shall furnish the [Department] the results of the voting at least seven days before the intended strike or lockout, subject to the cooling-off period herein provided. xxxx The procedural requirements for a valid strike are, therefore, the following, to wit: (1) a notice of strike filed with the DOLE at least 30 days before the intended date thereof, or 15 days in case of ULP; (2) a strike vote approved by the majority of the total union membership in the bargaining unit concerned, obtained by secret ballot in a meeting called for that purpose; and (3) a notice of the results of the voting at least seven days before the intended strike given to the DOLE. These requirements are mandatory, such that non-compliance therewith by the union will render the strike illegal.[41] According to the CA, the petitioners neither filed the notice of strike with the DOLE, nor observed the cooling-off period, nor submitted the result of the strike vote. Moreover, although the strike vote was conducted, the same was done by open, not secret, balloting,[42] in blatant violation of Article 263 and Section 7, Rule XIII of the Omnibus Rules Implementing the Labor Code.[43] It is not amiss to observe that the evident intention of the requirements for the strike-notice and the strike-vote report is to reasonably regulate the right to strike for the attainment of the legitimate policy objectives embodied in the law.[44] As such, the petitioners committed a prohibited activity under Article 264(a) of the Labor Code, and rendered their strike illegal. We underscore that the language of the law itself unmistakably bears out the mandatory character of the limitations it has prescribed, to wit:

Art. 264. Prohibited activities. - (a) No labor organization or employer shall declare a strike or lockout without first having bargained collectively in accordance with Title VII of this Book or without first having filed the notice required in the preceding Article or without the necessary strike or lockout vote first having been obtained and reported to the [Department], (emphasis supplied) xxxx Accordingly, the petitioners' plea for the revisit of the doctrine to the effect that the compliance with Article 263 was mandatory was entirely unwarranted. It is significant to remind that the doctrine has not been established by judicial declaration but by congressional enactment. Verba legis non est recedendum. The words of a statute,

when they are clear, plain and free from ambiguity, must be given their literal meaning and must be applied without interpretation.[45] Had the legislators' intention been to relax this restriction on the right of labor to engage in concerted activities, they would have stated so plainly and unequivocally.

II Commission of unlawful acts during the strike further rendered the same illegal The petitioners insist that all they did was to conduct an orderly, peaceful, and moving picket. They deny employing any act of violence or obstruction of HSBC's entry and exit points during the period of the strike. The contrary was undeniably true. The strike was far from orderly and peaceful. HSBC's claim that from the time when the strike was commenced on December 22, 1993 the petitioners had on several instances obstructed the ingress into and egress from its offices in Makati and in Pasig was not competently disputed, and should thus be accorded credence in the light of the records. We agree with HSBC, for all the affidavits[46] and testimonies of its witnesses,[47] as well as the photographs[48] and the video recordings[49] reviewed by LA Pati depicted the acts of obstruction, violence and intimidation committed by the petitioners during their picketing. It was undeniable that such acts of the strikers forced HSBC's officers to resort to unusual means of gaining access into its premises at one point.[50] In this connection, LA Pati even observed as follows:

[I]t must be pointed out that the Bank has shown by clear and indubitable evidence that most of the respondents have actually violated the prescription provided for in paragraph (b) of Article 264 on free ingress and egress. The incident depicted in the video footage of 05 January 1994, which has been viewed several times during the trial and even privately, demonstrates beyond doubt that the picket was a non-moving, stationary one - nothing less but a barricade. This office is more than convinced that the respondents, at least on that day, have demonstrated an abnormally high degree of hatred and anger at the Bank and its officers (including the Bank's chief executive officer who fell to the ground as a result of the pushing and shoving) leading them to do anything to carry out their resolve not to let anymore inside the Bank. Additionally, as observed by this Labor Arbiter, the tensed and disquieting relation between the parties became all the more apparent during the actual hearings as clearly evident from the demeanor and actuations of the respondents.[51] (Emphasis supplied) The situation during the strike actually went out of hand because of the petitioners' illegal conduct, compelling HSBC to secure an injunction from the NLRC as well as to file its petition for habeas corpus in the proper court in the interest of its trapped officers and employees; and at one point to lease an helicopter to extract its employees and

officers from its premises on the eve of Christmas Day of 1993. For sure, the petitioners could not justify their illegal strike by invoking the constitutional right of labor to concerted actions. Although the Constitution recognized and promoted their right to strike, they should still exercise the right within the bounds of law.[52] Those bounds had been well-defined and well-known. Specifically, Article 264(e) of the Labor Code expressly enjoined the striking workers engaged in picketing from committing any act of violence, coercion or intimidation, or from obstructing the free ingress into or egress from the employer's premises for lawful purposes, or from obstructing public thoroughfares.[53] The employment of prohibited means in carrying out concerted actions injurious to the right to property of others could only render their strike illegal. Moreover, their strike was rendered unlawful because their picketing which constituted an obstruction to the free use of the employer's property or the comfortable enjoyment of life or property, when accompanied by intimidation, threats, violence, and coercion as to constitute nuisance, should be regulated.[54]In fine, the strike, even if justified as to its ends, could become illegal because of the means employed, especially when the means came within the prohibitions under Article 264(e) of the Labor Code:[55]

III Good faith did not avail because of the patent violation of Article 263 of the Labor Code

The petitioners assert their good faith by maintaining that their strike was conducted out of their sincere belief that HSBC had committed ULP in implementing the JEP. They had also hoped that HSBC would be willing to negotiate matters related to the JEP considering that the economic aspect of the CBA was set to expire on March 31, 1993. We rule out good faith on the part of the petitioners. The petitioners' disregard of the procedural requirements for conducting a valid strike negated their claim of good faith. For their claim to be upheld, it was not enough for them to believe that their employer was guilty of ULP, for they must also sufficiently show that the strike was undertaken with a modicum of obeisance to the restrictions on their exercise of the right to strike prior to and during its execution as prescribed by the law. They did not establish their compliance with the requirements specifically for the holding of the strike vote and the giving of the strike notice.[56] The petitioners should entirely bear the consequence of their non-compliance with the legal requirements. As we said in Pilipino Telephone Corporation v. Pilipino Telephone Employees Association (PILTEA):[57]

[W]e do not find any reason to deviate from our rulings in Gold City Integrated Port Service, Inc. and Nissan Motors Philippines, Inc. It bears emphasis that the strike

staged by the Union in the instant case was illegal for its procedural infirmities and for defiance of the Secretary's assumption order. The CA, the NLRC and the Labor Arbiter were unanimous in finding that bad faith existed in the conduct of the subject strike. The relevant portion of the CA Decision states: xxx We cannot go to the extent of ascribing good faith to the means taken in conducting the strike. The requirement of the law is simple, that is—1. Give a Notice of Strike; 2. Observe the cooling period; 3. Observe the mandatory seven day strike ban; 3. If the act is union busting, then the union may strike doing away with the coolingoff period, subject only to the seven-day strike ban. To be lawful, a strike must simply have a lawful purpose and should be executed through lawful means. Here, the union cannot claim good faith in the conduct of the strike because, as can be gleaned from the findings of the Labor Arbiter, this was an extensively coordinated strike having been conducted all throughout the offices of PILTEL all over the country. Evidently, the strike was planned. Verily, they cannot now come to court hiding behind the shield of "good faith." Be that as it may, petitioners claim good faith only in so far as their grounds for the strike but not on the conduct of the strike. Consequently, they still had to comply with the procedural requirements for a strike, which, in this case, they failed to do so.[58]

IV The finding on the illegal strike did not justify the wholesale termination of the strikers from employment The next issue to resolve is whether or not HSBC lawfully dismissed the petitioners for joining the illegal strike. As a general rule, the mere finding of the illegality of the strike does not justify the wholesale termination of the strikers from their employment.[59] To avoid rendering the recognition of the workers' right to strike illusory, the responsibility for the illegal strike is individual instead of collective.[60] The last paragraph of Article 264(a) of the Labor Code defines the norm for terminating the workers participating in an illegal strike, viz.:

Article 264. Prohibited Activities -xxx xxxx Any worker whose employment has been terminated as a consequence of any unlawful lockout shall be entitled to reinstatement with full backwages. Any union officer who knowingly participates in an illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment status: Provided, That mere participation of a worker in a lawful strike shall not constitute sufficient ground for termination of his

employment, even if a replacement had been hired by the employer during such lawful strike, (emphasis supplied) Conformably with Article 264, we need to distinguish between the officers and the members of the union who participate in an illegal strike. The officers may be deemed terminated from their employment upon a finding of their knowing participation in the illegal strike,but the members of the union shall suffer the same fate only if they are shown to have knowingly participated in the commission of illegal acts during the strike. Article 264 expressly requires that the officer must have knowingly participated in the illegal strike. We have explained this essential element in Club Filipino, Inc. v. Bautista,[61] thusly:

Note that the verb "participates" is preceded by the adverb "knowingly." This reflects the intent of the legislature to require "knowledge" as a condition sine qua non before a union officer can be dismissed from employment for participating in an illegal strike. The provision is worded in such a way as to make it very difficult for employers to circumvent the law by arbitrarily dismissing employees in the guise of exercising management prerogative. This is but one aspect of the State's constitutional and statutory mandate to protect the rights of employees to self-organization.[62] The petitioners assert that the CA erroneously affirmed the dismissal of Carmina Rivera and Mario Fermin by virtue of their being officers of the Union despite lack of proof of their having participated in the strike. The assertion is partly correct. In the case of Fermin, HSBC did not satisfactorily prove his presence during the strike, much less identify him as among the strikers. In contrast, Union president Ma. Dalisay dela Chica testified that Fermin was not around when the Union's Board met after the strike vote to agree on the date of the strike.[63] In that regard, Corazon Fermin, his widow, confirmed the Union president's testimony by attesting that her husband had been on leave from work prior to and during the strike because of his heart condition.[64] Although Corazon also attested that her husband had fully supported the strike, his extending moral support for the strikers did not constitute sufficient proof of his participation in the strike in the absence of a showing of any overt participation by him in the illegal strike. The burden of proving the overt participation in the illegal strike by Fermin solely belonged to HSBC, which did not discharge its burden. Accordingly, Fermin, albeit an officer of the Union, should not be deemed to have lost his employment status. However, the dismissal of Rivera and of the rest of the Union's officers, namely: Ma. Dalisay dela Chica, Marvilon Militante and David Atanacio, is upheld. Rivera admitted joining the picket line on a few occasions.[65] Dela Chica, the Union president, had instigated and called for the strike on December 22, 1993.[66] In addition, HSBC identified Dela Chica[67] and Militante[68] as having actively participated in the strike.

Their responsibility as the officers of the Union who led the illegal strike was greater than the responsibility of the members simply because the former had the duty to guide their members to obey and respect the law.[69] When said officers urged and made their members violate the law, their dismissal became an appropriate penalty for their unlawful act.[70] The law granted to HSBC the option to dismiss the officers as a matter of right and prerogative.[71] Unlike the Union's officers, the ordinary striking members could not be terminated for merely taking part in the illegal strike. Regardless of whether the strike was illegal or not, the dismissal of the members could be upheld only upon proof that they had committed illegal acts during the strike. They must be specifically identified because the liability for the prohibited acts was determined on an individual basis.[72] For that purpose, substantial evidence available under the attendant circumstances justifying the penalty of dismissal sufficed.[73] We declare the illegality of the termination of the employment of the 18 members of the Union for failure of HSBC to prove that they had committed illegal acts during the strike. We also declare that Daisy Fagutao was unlawfully dismissed because HSBC did not adduce substantial evidence establishing her presence and her commission of unlawful acts during the strike. We clarify that the 18 employees, including Fagutao and Union officer Fermin, were illegally dismissed because of lack of any valid ground to dismiss them, and for deprivation of procedural due process. Thus, we take exception to that portion of the NLRC ruling that held:

We here note that all of the herein named respondents were terminated by complainant for reasons other than their holding of an participation in the illegal strike. Specifically, the grounds for their termination were enumerated in the notices of termination sent out by complainant as follows: abandonment, insubordination and seriously hampering operations. To Our mind, the complainant in the exercise of its management prerogative, had every reason to discipline these respondents for their disregard of the complainant's return-to-work order and for the damage sustained by reason thereof. Although these 18 respondents did not commit any illegal act during the strike, We can not simply ignore the fact that they nonetheless breached complainant's rules and regulations and which acts serve as valid causes to terminate their employment. These respondents took a risk when they refused to heed complainant's lawful order and knowingly caused damage and prejudice to complainant's operations; they should be prepared to take the consequences and be held accountable for their actions. Whether or not complainant observed due process prior to the termination of these respondents is however a totally different matter.[74] We hold that said employees' right to exercise their right to concerted activities should not be defeated by the directive of HSBC for them to report back to work. Any worker who joined the strike did so precisely to assert or improve the terms and conditions of

his work.[75]Otherwise, the mere expediency of issuing the return to work memorandum could suffice to stifle the constitutional right of labor to concerted actions. Such practice would vest in the employer the functions of a strike breaker,[76] which is prohibited under Article 264(c) of the Labor Code. The petitioners' refusal to leave their cause against HSBC constituted neither insubordination nor abandonment. For insubordination to exist, the order must be: (1) reasonable and lawful; (2) sufficiently known to the employee; and (3) in connection to his duties.[77] None of these elements existed in this case. As to abandonment, two requirements need to be established, namely: (1) the failure to report for work or absence must be without valid or justifiable reason; and (2) there must be a clear intention to sever the employer-employee relationship. The second element is the more decisive factor and must be manifested by overt acts. [78] In that regard, the employer carries the burden of proof to show the employee's deliberate and unjustified refusal to resume his employment without any intention of returning.[79] However, the petitioners unquestionably had no intention to sever the employer-employee relationship because they would not have gone to the trouble of joining the strike had their purpose been to abandon their employment.[80] Moreover, we cannot subscribe to the view that the striking employees should be dismissed for having seriously hampered and damaged HSBC's operations. In this aspect of the case, HSBC did not discharge its burden to prove that the acts of the employees constituted any of the just causes under the Labor Code or were prohibited under the company's code of conduct as to warrant their dismissal.

V Non-compliance with due process resulted in illegal dismissal; the employer's liability depended on the availing circumstances While Article 264 authorizes the termination of the union officers and employees, it does not remove from the employees their right to due process. Regardless of their actions during the strike, the employees remain entitled to an opportunity to explain their conduct and why they should not be penalized. In Suico v. National Labor Relations Commission,[81] we have reiterated the need for the employers to comply with the twinnotice requirement despite the cause for the termination arising from the commission of the acts prohibited by Article 264, thus:

Art. 277(b) in relation to Art. 264(a) and (e) recognizes the right to due process of all workers, without distinction as to the cause of their termination. Where no distinction is given, none is construed. Hence, the foregoing standards of due process apply to the termination of employment of Suico, et al. even if the cause therefor was their supposed involvement in strike-related violence prohibited under Art. 264 (a) and (e).[82]

Consequently, failure of the employer to accord due process to its employees prior to their termination results in illegal dismissal. The petitioners maintain that the CA applied the twin-notice requirement in favor of the 18 employees. HSBC disagrees, claiming instead that the award of backwages in favor of said employees should be modified following Agabon. We partially agree with both parties. Article 277(b)[83] of the Labor Code mandates compliance with the twin-notice requirement in terminating an employee, viz.:

Article 277. Miscellaneous Provisions. xxxx (b) Subject to the constitutional right of workers to security of tenure and their right to be protected against dismissal except for a just and authorized cause and without prejudice to the requirement of notice under Article 283 of this Code, the employer shall furnish the worker whose employment is sought to be terminated a written notice containing a statement of the causes for termination and shall afford the latter ample opportunity to be heard and to defend himself with the assistance of his representative, if he so desires, in accordance with company rules and regulations promulgated pursuant to guidelines set by the Department of Labor and Employment, x x x (Emphasis supplied) In King of Kings Transport, Inc. v. Mamac,[84] we have laid down the contents of the notices to be served upon an employee prior to termination, as follows:

(1) The first written notice to be served on the employees should contain the specific causes or grounds for termination against them, and a directive that the employees are given the opportunity to submit their written explanation within a reasonable period. "Reasonable opportunity" under the Omnibus Rules means every kind of assistance that management must accord to the employees to enable them to prepare adequately for their defense. This should be construed as a period of at least five (5) calendar days from receipt of the notice to give the employees an opportunity to study the accusation against them, consult a union official or lawyer, gather data and evidence, and decide on the defenses they will raise against the complaint. Moreover, in order to enable the employees to intelligently prepare their explanation and defenses, the notice should contain a detailed narration of the facts and circumstances that will serve as basis for the charge against the employees. A general description of the charge will not suffice. Lastly, the notice should specifically mention which company rules, if any, are violated and/or which among the grounds under Art. 282 is being charged against

the employees. xxxx (3) After determining that termination of employment is justified, the employers shall serve the employees a written notice of termination indicating that: (1) all circumstances involving the charge against the employees have been considered; and (2) grounds have been established to justify the severance of their employment.[85] (Emphasis supplied) HSBC admitted issuing two pro forma notices to the striking employees. The first notice, sent on December 22, 1993, reads as follows:

Re: NOTICE OF RETURN TO WORK __________________________________________________ On ___________________ at ________ o'clock in the morning/afternoon, you "walkedout" by leaving your assigned work station without prior permission/leave during work hours. You arc hereby directed to report back for work at the start of banking hours on the day immediately following knowledge or receipt of this notice. Should you report for work no disciplinary action shall be imposed on you. Ibis is without prejudice to any action the Bank may take against the Union. Should you fail to report back for work within the period abovestated, the Bank shall be forced to terminate your employment and take all appropriate measures to continue serving its clients.[86] As the notice indicates, HSBC did not fully apprise the strikers of the ground under the Labor Code that they had supposedly violated. It also thereby deprived them the ample opportunity to explain and justify their actions. Instead, it manifested therein its firm resolve to impose the extreme penalty of termination should they not comply with the order. Plainly, the tenor of the notice was short of the requirements of a valid first notice. The second notice was as follows:

Re: NOTICE OF TERMINATION __________________________________________________________ On_________ , 1993, you and a majority of the rank-and-file staff "walked out" by leaving your respective work stations without prior leave and failed to return.

You were directed to report back for work when a copy of the Bank's Memorandum/Notice to Return to Work dated________________ 1993 was: 1. [ ] Posted on the Bank's premises on_______________ 2. [ ] served on your (sic) personally on____________________. 3. [ ] delivered to your last known address on file with the Bank and received by you (your representative) on Despite being directed to return to work, you have failed to comply. Your "walk-out" is an illegal act amounting to abandonment, insubordination, and seriously hampering and damaging the bank's operations. Consequently, your employment with the Bank is terminated effective ____________________, 1993.[87] The second notice merely ratified the hasty and unilateral decision to terminate the petitioners without the benefit of a notice and hearing. Hence, this notice should be struck down for having violated the right of the affected employees to due process. The failure by HSBC to strictly observe the twin-notice requirement resulted in the illegal dismissal. However, the extent of its liability should depend on the distinct circumstances of the employees. HSBC should be held liable for two types of illegal dismissal — the first type was made without both substantive and procedural due process, while the other was based on a valid cause but lacked compliance with procedural due process. To the first type belonged the dismissal of Fermin, Fagutao and the 18 employees initially identified by the NLRC, while the second type included the rest of the petitioners. HSBC maintains that the dismissed 18 employees should not be entitled to backwages in conformity with Agabon. We disagree. Agabon involved the second type of dismissal, not the first type to which the 18 employees belonged. The rule for employees unlawfully terminated without substantive and procedural due process is to entitle them to the reliefs provided under Article 279[88] of the Labor Code, that is, reinstatement without loss of seniority rights and other privileges and to his full backwages, inclusive of allowances, and other benefits or their monetary equivalent computed from the time the compensation was withheld up to the time of actual reinstatement. However, the award of baekwages is subject to the settled policy that when employees voluntarily go on strike, no baekwages during the strike shall be awarded.[89] As regards reinstatement, the lapse of 22 years since the strike now warrants the award of separation pay in lieu of reinstatement, the same to be equivalent of one (1) month for every year of service.[90] Accordingly, Fermin who did not participate in the strike, should be paid full baekwages plus separation pay of one (1) month per year of service, while petitioners Isabelo Molo, Samuel Ellarma, Rebecca Fajardo, Melo Gaba, Nelia

Deriada, Manuel Herrera, Rosalina Juliet Loquellano, Mercedes Paule, Blanche Motus, Antonio del Rosario, Maida Militante and Daisy Fagutao, who admitted their participation in the strike, were entitled to baekwages except during the period of the strike, and to separation pay of one (1) month per year of service in lieu of reinstatement. In Agabon, we said that a dismissal based either on a just or authorized cause but effected without due process should be upheld. The employer should be nonetheless liable for non-compliance with procedural due process by paying indemnity in the form of nominal damages amounting to P30,000.00. In view of the non-observance of procedural due process by HSBC, the following petitioners should be entitled to nominal damages of P30,000.00 each, [91] namely: Ma. Dalisay dela Chica, Marvilon Militante, David Atanacio, Carmina Rivera, Russel Palma, Imelda Hernandez, Vicente Llacuna, Josefina A. Ortiguerro, Ma. Asuncion Kimseng, Miguel R. Sison, Raul P. Geronimo, Marilou Cadena, Ana Tamonte, Avelino Relucio, Joralyn Gongora, Corazon Albos, Anabella Gonzales, Ma. Corazon Baltazar, Maria Luz Jimenez, Editha Broqueza, Ma. Theresa Galang, Benigno Amoin, Gerardo de Leon, Rowena Ocampo, Hernan Camposanto, Lolito Hilis, Grace Mabunay, Joselito Gonzaga, Uldarico Pedida, Marcial Gonzaga, Jose Teodoro Motus, Emmanuel Justin Grey, Julieta Cruz, Rodrigo Durano, Catalina Yee, Menandro Caligagan, Leonila Perez, and Emma Mateo. ACCORDINGLY, the Court AFFIRMS the decision promulgated on January 31, 2002 in CA-G.R. SP No. 56797 with MODIFICATION that respondent Hongkong & Shanghai Banking Corporation (HSBC) shall pay: 1. Mario S. Fermin, full backwages and separation pay equivalent to one (1) month per year of service in lieu of reinstatement; 2. Isabelo Molo, Samuel Ellarma, Rebecca Fajardo, Melo Gaba, Nelia Deriada, Manuel Herrera, Rosalina Juliet Loquellano, Mercedes Paule, Blanche Motus, Antonio del Rosario, Maida Militante and Daisy Fagutao, backwages except during the period of the strike, and separation pay equivalent to one (1) month per year of service in lieu of reinstatement; and 3. Ma. Dalisay dela Chica, Marvilon Militante, David Atanacio, Carmina Rivera, Russel Palma, Imelda Hernandez, Vicente Llacuna, Josefina A. Ortiguerro, Ma. Asuncion Kimseng, Miguel R. Sison, Raul P. Geronimo, Marilou Cadena, Ana Tamonte, Avelino Relucio, Joralyn Gongora, Corazon Albos, Anabella Gonzales, Ma. Corazon Baltazar, Maria Luz Jimenez, Editha Broqueza, Ma. Theresa Galang, Benigno Amion, Gerardo de Leon, Rowena Ocampo, Hernan Camposanto, Lolito Hilis, Grace Mabunay, Joselito Gonzaga, Uldarico Pedida, Marcial Gonzaga, Jose Teodoro Motus, Emmanuel Justin Grey, Julieta Cruz, Rodrigo Durano, Catalina Yee, Menandro Caligagan, Leonila Perez and Emma

Mateo, indemnity in the form of nominal damages in the amount of P30,000.00 each. No pronouncement as to costs. SO ORDERED.

c. G.R. No. 101858 BATANGAS LAGUNA TAYABAS BUS COMPANY v. NLRC MEMBERS + GR No. 101858, Aug 21, 1992 ]

CRUZ, J.: This case arose when on May 23, 1988, private respondent Tinig at Lakas ng Manggagawa sa BLTB Co. NAFLU (TLM-BLTB-NAFLU), an affiliate of the National Federation of Labor Unions (NAFLU), filed a Notice of Strike against the Batangas Laguna Tayabas Bus Company on the grounds of unfair labor practice and violation of the CBA. The reaction of BLTBCo was to ask the Secretary of Labor to assume jurisdiction over the dispute or to certify it to the National Labor Relations Commission for compulsory arbitration. The petitioner also moved to dismiss the notice of strike on August 3, 1988. Efforts at amicable settlement having failed, Acting Labor Secretary C. Castro certified the dispute to the NLRC on August 29, 1988.[1] A copy of the certification order was served upon the NAFLU on August 29, 1988, and on the TLM-BLTBCo-NAFLU on August 30, 1988. However, it was noted in the notice of order that union secretary Jerry Soriano refused to receive it. On August 31, 1988, the officers and members of TLM-BLTBCo-NAFLU went on strike and maintained picket lines blocking the premises of BLTBCo's terminals. On September 6, 1988, the NLRC issued an en banc resolution ordering the striking employees to lift their picket and to remove all obstructions and barricades. All striking employees on payroll as of May 23, 1988, were required to return to work. BLTBCo was

directed to accept them back to work within 5 days under the same terms and conditions prevailing before the strike.[2] On September 15, 1988, the BLTBCo caused the publication of the resolution and called on all striking workers to return to work not later than September 18, 1988. It later extended the deadline to September 19, 1988. Of the some 1,730 BLTBCo employees who went on strike, only 1,116 reported back for work. Seventeen others were later re-admitted. Subsequently, about 614 employees, including those who were allegedly dismissed for causes other than the strike, filed individual complaints for illegal dismissal. Their common ground was that they were refused admission when they reported back for work. Among those who failed to comply with the return-to-work order were the respondent individual union members. On July 19, 1991, the NLRC issued a resolution deciding the dispute thus: WHEREFORE, judgment is hereby rendered as follows: 1. Dismissing the charge of unfair labor practice and union busting filed by the union against BLTBCo for lack of merit; 2. Ordering BLTBCo to fully implement the provisions of the CBA in the matter of uniform and safety shoes; 3. Declaring valid the dismissal of Jose M. Calubayan, Tirso Vinas, Ronelito Torres, Floro T. Isla and Rosauro Aguilar, being grounded on lawful causes; 4. Declaring the strike illegal; 5. Declaring the following officers and members of the union, namely: x x x to have lost their employment status; 6. Ordering the reinstatement of the following union members, namely; x x x to their former position without loss of seniority rights but without backwages. 7. The case of Ladislao Violanda is considered withdrawn. 8. Directing likewise the reinstatement of all striking employees of BLTBCo who have not committed illegal acts. 9. Declaring regular the employment of casual employees who have already rendered service of at least one year whether continuous or broken. On September 16, 1991, the NLRC issued the other challenged resolution, viz.: WHEREFORE, the Motion for Reconsideration of Respondent BLTBCo and Complainant Pepito Abratique are denied for lack of merit. As a consequence, respondent's prayer for temporary restraining order is likewise denied.

As prayed for, respondent is directed to reinstate the union members specifically named in the questioned resolution and all those striking employees who have not committed illegal acts. This order of reinstatement is immediately executory. No further motions for reconsideration shall be allowed. BLTB then filed this special civil action for certiorari, claiming that the respondent NLRC committed grave abuse of discretion in: 1. ordering the reinstatement of the aforenamed 190 individual respondent union members notwithstanding the fact that they knowingly participated in a strike which was illegal from its inception as it was done in complete defiance and/or disobedience to the Assumption Order of August 29, 1988 and the Return-To-Work Order of September 6, 1988; 2. failing to consider that aforenamed individual union members have already abandoned their employment when they defied the Return-To-Work Order of September 6, 1988; 3. limiting the declaration of forfeiture of employment status to mere thirty-six (36) union officers and members of the striking union when BLTBCo was able to initially identify at least (a) one hundred (100) employees who committed illegal/violent acts during and after the strike; and (b) twenty (20) employees who reported back for work and later on abandoned it and resumed their strike activities; 4. not including the recognized union officers - Jerry Soriano, Serafin Soriano and Desiderio Comel - among the union officers whose employment status have been declared forfeited; and 5. incorporating in its subject Resolution a blanket order reinstating BLTBCo's striking employees who have not committed illegal acts. On motion of the petitioner and upon its posting of a cash bond in the amount of P500,000.00, the Court issued a temporary restraining order on November 6, 1991, against the enforcement of the above-quoted resolutions.[3] Separate comments on the petition were filed by two of the private respondents, Celso Peñana and Pepito Abratique, and by the Solicitor General on behalf of the public respondent. A consolidated reply to these comments was later submitted by the petitioner. The Court has deliberated on the arguments of the parties and finds that the challenged resolutions must be sustained. BLTBCo contends that the 190 union members who participated in the illegal strike should not have been reinstated because they defied the return-to-work order of September 6, 1988. It invokes against the NLRC its own words in its resolution of July 19, 1991, where it said: A strike that is undertaken despite the issuance by the Secretary of Labor of an assumption or certification order becomes a prohibited activity and thus illegal, pursuant

to the second paragraph of Art. 264 of the Labor Code as amended (Zamboanga Wood Products, Inc. v. NLRC, G.R. 82088, October 13, 1989: 178 SCRA 482). The Union officers and members, as a result, are deemed to have lost their employment status for having knowingly participated in an illegal act. (Union of Filipro Employees (UFE), et al. vs. Nestle Philippines, Inc., et al., G.R. No. 88710-13, December 19, 1991) That is only half the picture, however. As the NLRC further explained, it was "not inclined to declare a whole-sale forfeiture of employment status of all those who participated in the strike" because, first of all, there was inadequate service of the certification order on the union as of the date the strike was declared and there was no showing that the striking members had been apprised of such order by the NAFLU. Secondly, and more importantly, the resolution declared as follows: Applying the principle of vicarious liability, only the officers of the union deserved to be penalized with the loss of their employment status. The leaders of the union are the moving force in the declaration of the strike and the Rank-in-file employees merely followed. Likewise, viewed in the light of Article 264, paragraph (e), those who participated in the commission of illegal acts who stood charged criminally thereof in court must be penalized. BLTBCo will have to agree with Us that while the general membership of TLM-NAFLU may have joined the strike at its inception, We are convinced that they returned to work on September 19, 1988 or, immediately thereafter. And, We are not swayed that these employees have abandoned their job just because they reported late or, beyond the period required by the Commission and by BLTBCo. The circumstances of time and place of employment and the residences of the employees as well as the lack of individual notice to them are reasons enough to justify their failure to beat the deadline. True it is, that management of BLTBCo caused the publication of the Resolution of the Commission of September 5, 1988 in the Manila Bulletin, We cannot reasonably expect the complainants, who are ordinary workers, to be regular readers of such newspaper. Moreover, the publication of the said resolution was only made once. We accept these factual conclusions as they do not appear to have been reached arbitrarily. The mere fact that the majority of the strikers were able to return to work does not necessarily mean that the rest deliberately defied the return-to-work order or that they had been sufficiently notified thereof. As the Solicitor General correctly adds, some of them may have left Metro Manila and did not have enough time to return during the period given by the petitioner, which was only five days. The contention of the petitioner that the private respondents abandoned their position is also not acceptable. An employee who forthwith takes steps to protest his lay-off cannot by any logic be said to have abandoned his work. For abandonment to constitute a valid cause for termination of employment, there must be a deliberate, unjustified refusal of the employee to resume his employment. [4] This refusal must be clearly established. As we stressed in a recent case,[5] mere absence is not sufficient; it must be accompanied by overt acts unerringly pointing to the fact that the employee simply does not want to work anymore. In the case at bar, the affidavit of Eduardo Azucena, BLTBCo operations manager,[6] besides being hearsay, lacks

credibility in light of the subsequent acts of the private respondents in complaining about their separation. A worker who joins a strike does so precisely to assert or improve the terms and conditions of his employment. If his purpose is to abandon his work, he would not go to the trouble of joining a strike. The petitioner also alleges that the NLRC erred in limiting the forfeiture of employment status to the 36 union officers and members although there were at least 100 employees who committed violent acts and 20 employees who reported back for work and later abandoned it to resume their strike activities. These issues are also factual. The findings thereon of the NLRC are conclusive on us and will not be disturbed as it clearly appears that they are not tainted with grave abuse of discretion. We agree with the Solicitor General that the mere filing of charges against an employee for alleged illegal acts during a strike does not by itself justify his dismissal. The charges must be proved at an investigation duly called where the employee shall be given an opportunity to defend himself. This is true even if the alleged ground constitutes a criminal offense, as we held in Almira v. B.F. Goodrich Phil., Inc.[7] In that case, we ordered the reinstatement of employees against whom criminal complaints had been filed but not yet proved. The next contention of the petitioner is that Serafin Soriano, Jerry Soriano and Desiderio Comel should also be dismissed with the other union officers and members who participated in the illegal strike. We note, however, that these three have not been impleaded in this petition (unlike the others who have been individually named) and so have not been given an opportunity to defend themselves against the charges of BLTBCo. Absent such an opportunity, we are precluded from making any pronouncement regarding their alleged role in the strike for which their dismissal is sought. The petitioner's last point is that the NLRC should not have issued the blanket directive for the "reinstatement of all striking employees of BLTBCo who have not committed illegal acts." The key clause here is "who have not committed illegal acts. The directive was not really "blanket," as the petitioner would call it, but indeed selective. The NLRC made this clear in the resolution dated September 16, 1991, thus: The loss of employment status of striking union members is limited to those "who knowingly participates in the commission of illegal acts." (Article 264, Labor Code) Evidence must be presented to substantiate the commission thereof and not merely an unsubstantiated allegation. He who asserts the commission of illegal acts, must prove the same, and it is on the basis of substantiated evidence that this Commission declares the loss of employment status of specific union members who have committed illegal acts. This Commission's order directing the reinstatement of all striking employees against whom no complaint of illegal acts having been committed during the strikes, and who were barred from returning to work and is similarly situated with those who have been

directed to be reinstated, should, as a consequence and on the basis of the reasons discussed in the questioned resolution be reinstated. There is no denial of due process in this direction, for respondent has been given the chance to defend its position. Elaborating on the same issue, the Solicitor General astutely observes: The assailed Resolution does not prevent petitioner from continuing with its investigations and come up with evidence against these workers. But they have to be admitted back to their work first. This is clearly a situation where the social justice provisions of our laws and jurisprudence come in aid of labor. Since such investigations might be extended, intentionally or otherwise, the workers are in danger of losing their livelihood. As compared to the management that is in a position to wage an extended legal struggle against labor, the latter cannot do so. This is where the State intervenes to equalize matters between labor and management. The right to strike is one of the rights recognized and guaranteed by the Constitution as an instrument of labor for its protection against exploitation by management. By virtue of this right, the workers are able to press their demands for better terms of employment with more energy and persuasiveness, poising the threat to strike as their reaction to the employer's intransigence. The strike is indeed a powerful weapon of the working class. But precisely because of this, it must be handled carefully, like a sensitive explosive, lest it blow up in the workers' own hands. Thus, it must be declared only after the most thoughtful consultation among them, conducted in the only way allowed, that is, peacefully, and in every case conformably to reasonable regulation. Any violation of the legal requirements and strictures, such as a defiance of a return-to-work order in industries affected with public interest, will render the strike illegal, to the detriment of the very workers it is supposed to protect. Even war must be lawfully waged. A labor dispute demands no less observance of the rules, for the benefit of all concerned. WHEREFORE, the petition is DISMISSED. The resolutions dated July 19, 1991, and September 16, 1991, are AFFIRMED. The temporary restraining order dated November 6, 1991, is LIFTED. Costs against the petitioner. SO ORDERED.

E. G.R. No. 85279 July 28, 1989 SOCIAL SECURITY SYSTEM EMPLOYEES ASSOCIATION (SSSEA), DIONISION T. BAYLON, RAMON MODESTO, JUANITO MADURA, REUBEN ZAMORA, VIRGILIO DE ALDAY, SERGIO ARANETA, PLACIDO AGUSTIN, VIRGILIO MAGPAYO, petitioner, vs.

THE COURT OF APPEALS, SOCIAL SECURITY SYSTEM (SSS), HON. CEZAR C. PERALEJO, RTC, BRANCH 98, QUEZON CITY, respondents. Vicente T. Ocampo & Associates for petitioners.

CORTES, J: Primarily, the issue raised in this petition is whether or not the Regional Trial Court can enjoin the Social Security System Employees Association (SSSEA) from striking and order the striking employees to return to work. Collaterally, it is whether or not employees of the Social Security System (SSS) have the right to strike. The antecedents are as follows: On June 11, 1987, the SSS filed with the Regional Trial Court of Quezon City a complaint for damages with a prayer for a writ of preliminary injunction against petitioners, alleging that on June 9, 1987, the officers and members of SSSEA staged an illegal strike and baricaded the entrances to the SSS Building, preventing nonstriking employees from reporting for work and SSS members from transacting business with the SSS; that the strike was reported to the Public Sector Labor - Management Council, which ordered the strikers to return to work; that the strikers refused to return to work; and that the SSS suffered damages as a result of the strike. The complaint prayed that a writ of preliminary injunction be issued to enjoin the strike and that the strikers be ordered to return to work; that the defendants (petitioners herein) be ordered to pay damages; and that the strike be declared illegal. It appears that the SSSEA went on strike after the SSS failed to act on the union's demands, which included: implementation of the provisions of the old SSS-SSSEA collective bargaining agreement (CBA) on check-off of union dues; payment of accrued overtime pay, night differential pay and holiday pay; conversion of temporary or contractual employees with six (6) months or more of service into regular and permanent employees and their entitlement to the same salaries, allowances and benefits given to other regular employees of the SSS; and payment of the children's allowance of P30.00, and after the SSS deducted certain amounts from the salaries of the employees and allegedly committed acts of discrimination and unfair labor practices [Rollo, pp. 21-241]. The court a quo, on June 11, 1987, issued a temporary restraining order pending resolution of the application for a writ of preliminary injunction [Rollo, p. 71.] In the meantime, petitioners filed a motion to dismiss alleging the trial court's lack of jurisdiction over the subject matter [Rollo, pp. 72-82.] To this motion, the SSS filed an opposition, reiterating its prayer for the issuance of a writ of injunction [Rollo, pp. 209222]. On July 22,1987, in a four-page order, the court a quo denied the motion to dismiss and converted the restraining order into an injunction upon posting of a bond,

after finding that the strike was illegal [Rollo, pp. 83- 86]. As petitioners' motion for the reconsideration of the aforesaid order was also denied on August 14, 1988 [Rollo, p. 94], petitioners filed a petition for certiorari and prohibition with preliminary injunction before this Court. Their petition was docketed as G.R. No. 79577. In a resolution dated October 21, 1987, the Court, through the Third Division, resolved to refer the case to the Court of Appeals. Petitioners filed a motion for reconsideration thereof, but during its pendency the Court of Appeals on March 9,1988 promulgated its decision on the referred case [Rollo, pp. 130-137]. Petitioners moved to recall the Court of Appeals' decision. In the meantime, the Court on June 29,1988 denied the motion for reconsideration in G.R. No. 97577 for being moot and academic. Petitioners' motion to recall the decision of the Court of Appeals was also denied in view of this Court's denial of the motion for reconsideration [Rollo, pp. 141- 143]. Hence, the instant petition to review the decision of the Court of Appeals [Rollo, pp. 12-37]. Upon motion of the SSS on February 6,1989, the Court issued a temporary restraining order enjoining the petitioners from staging another strike or from pursuing the notice of strike they filed with the Department of Labor and Employment on January 25, 1989 and to maintain the status quo [Rollo, pp. 151-152]. The Court, taking the comment as answer, and noting the reply and supplemental reply filed by petitioners, considered the issues joined and the case submitted for decision. The position of the petitioners is that the Regional Trial Court had no jurisdiction to hear the case initiated by the SSS and to issue the restraining order and the writ of preliminary injunction, as jurisdiction lay with the Department of Labor and Employment or the National Labor Relations Commission, since the case involves a labor dispute. On the other hand, the SSS advances the contrary view, on the ground that the employees of the SSS are covered by civil service laws and rules and regulations, not the Labor Code, therefore they do not have the right to strike. Since neither the DOLE nor the NLRC has jurisdiction over the dispute, the Regional Trial Court may enjoin the employees from striking. In dismissing the petition for certiorari and prohibition with preliminary injunction filed by petitioners, the Court of Appeals held that since the employees of the SSS, are government employees, they are not allowed to strike, and may be enjoined by the Regional Trial Court, which had jurisdiction over the SSS' complaint for damages, from continuing with their strike. Thus, the sequential questions to be resolved by the Court in deciding whether or not the Court of Appeals erred in finding that the Regional Trial Court did not act without or in excess of jurisdiction when it took cognizance of the case and enjoined the strike are as follows: 1. Do the employees of the SSS have the right to strike?

2. Does the Regional Trial Court have jurisdiction to hear the case initiated by the SSS and to enjoin the strikers from continuing with the strike and to order them to return to work? These shall be discussed and resolved seriatim I The 1987 Constitution, in the Article on Social Justice and Human Rights, provides that the State "shall guarantee 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" [Art. XIII, Sec. 31]. By itself, this provision would seem to recognize the right of all workers and employees, including those in the public sector, to strike. But the Constitution itself fails to expressly confirm this impression, for in the Sub-Article on the Civil Service Commission, it provides, after defining the scope of the civil service as "all branches, subdivisions, instrumentalities, and agencies of the Government, including government-owned or controlled corporations with original charters," that "[t]he right to self-organization shall not be denied to government employees" [Art. IX(B), Sec. 2(l) and (50)]. Parenthetically, the Bill of Rights also provides that "[tlhe right of the people, including those employed in the public and private sectors, to form unions, associations, or societies for purposes not contrary to law shall not abridged" [Art. III, Sec. 8]. Thus, while there is no question that the Constitution recognizes the right of government employees to organize, it is silent as to whether such recognition also includes the right to strike. Resort to the intent of the framers of the organic law becomes helpful in understanding the meaning of these provisions. A reading of the proceedings of the Constitutional Commission that drafted the 1987 Constitution would show that in recognizing the right of government employees to organize, the commissioners intended to limit the right to the formation of unions or associations only, without including the right to strike. Thus, Commissioner Eulogio R. Lerum, one of the sponsors of the provision that "[tlhe right to self-organization shall not be denied to government employees" [Art. IX(B), Sec. 2(5)], in answer to the apprehensions expressed by Commissioner Ambrosio B. Padilla, Vice-President of the Commission, explained: MR. LERUM. I think what I will try to say will not take that long. When we proposed this amendment providing for self-organization of government employees, it does not mean that because they have the right to organize, they also have the right to strike. That is a different matter. We are only talking about organizing, uniting as a union. With regard to the right to strike, everyone will remember that in the Bill of Rights, there is a provision that the right to form associations or societies whose purpose is not contrary to law shall not be abridged. Now then, if the purpose of the state is to prohibit the strikes coming from employees exercising

government functions, that could be done because the moment that is prohibited, then the union which will go on strike will be an illegal union. And that provision is carried in Republic Act 875. In Republic Act 875, workers, including those from the government-owned and controlled, are allowed to organize but they are prohibited from striking. So, the fear of our honorable Vice- President is unfounded. It does not mean that because we approve this resolution, it carries with it the right to strike. That is a different matter. As a matter of fact, that subject is now being discussed in the Committee on Social Justice because we are trying to find a solution to this problem. We know that this problem exist; that the moment we allow anybody in the government to strike, then what will happen if the members of the Armed Forces will go on strike? What will happen to those people trying to protect us? So that is a matter of discussion in the Committee on Social Justice. But, I repeat, the right to form an organization does not carry with it the right to strike. [Record of the Constitutional Commission, vol. 1, p. 569]. It will be recalled that the Industrial Peace Act (R.A. No. 875), which was repealed by the Labor Code (P.D. 442) in 1974, expressly banned strikes by employees in the Government, including instrumentalities exercising governmental functions, but excluding entities entrusted with proprietary functions: .Sec. 11. Prohibition Against Strikes in the Government. — The terms and conditions of employment in the Government, including any political subdivision or instrumentality thereof, are governed by law and it is declared to be the policy of this Act that employees therein shall not strike for the purpose of securing changes or modification in their terms and conditions of employment. Such employees may belong to any labor organization which does not impose the obligation to strike or to join in strike: Provided, however, That this section shall apply only to employees employed in governmental functions and not those employed in proprietary functions of the Government including but not limited to governmental corporations. No similar provision is found in the Labor Code, although at one time it recognized the right of employees of government corporations established under the Corporation Code to organize and bargain collectively and those in the civil service to "form organizations for purposes not contrary to law" [Art. 244, before its amendment by B.P. Blg. 70 in 1980], in the same breath it provided that "[t]he terms and conditions of employment of all government employees, including employees of government owned and controlled corporations, shall be governed by the Civil Service Law, rules and regulations" [now Art. 276]. Understandably, the Labor Code is silent as to whether or not government employees may strike, for such are excluded from its coverage [Ibid]. But then the Civil Service Decree [P.D. No. 807], is equally silent on the matter.

On June 1, 1987, to implement the constitutional guarantee of the right of government employees to organize, the President issued E.O. No. 180 which provides guidelines for the exercise of the right to organize of government employees. In Section 14 thereof, it is provided that "[t]he Civil Service law and rules governing concerted activities and strikes in the government service shall be observed, subject to any legislation that may be enacted by Congress." The President was apparently referring to Memorandum Circular No. 6, s. 1987 of the Civil Service Commission under date April 21, 1987 which, "prior to the enactment by Congress of applicable laws concerning strike by government employees ... enjoins under pain of administrative sanctions, all government officers and employees from staging strikes, demonstrations, mass leaves, walk-outs and other forms of mass action which will result in temporary stoppage or disruption of public service." The air was thus cleared of the confusion. At present, in the absence of any legislation allowing government employees to strike, recognizing their right to do so, or regulating the exercise of the right, they are prohibited from striking, by express provision of Memorandum Circular No. 6 and as implied in E.O. No. 180. [At this juncture, it must be stated that the validity of Memorandum Circular No. 6 is not at issue]. But are employees of the SSS covered by the prohibition against strikes? The Court is of the considered view that they are. Considering that under the 1987 Constitution "[t]he civil service embraces all branches, subdivisions, instrumentalities, and agencies of the Government, including government-owned or controlled corporations with original charters" [Art. IX(B), Sec. .2(l) see also Sec. 1 of E.O. No. 180 where the employees in the civil service are denominated as "government employees"] and that the SSS is one such government-controlled corporation with an original charter, having been created under R.A. No. 1161, its employees are part of the civil service [NASECO v. NLRC, G.R. Nos. 69870 & 70295, November 24,1988] and are covered by the Civil Service Commission's memorandum prohibiting strikes. This being the case, the strike staged by the employees of the SSS was illegal. The statement of the Court in Alliance of Government Workers v. Minister of Labor and Employment [G.R. No. 60403, August 3, 1:983, 124 SCRA 11 is relevant as it furnishes the rationale for distinguishing between workers in the private sector and government employees with regard to the right to strike: The general rule in the past and up to the present is that 'the terms and conditions of employment in the Government, including any political subdivision or instrumentality thereof are governed by law" (Section 11, the Industrial Peace Act, R.A. No. 875, as amended and Article 277, the Labor Code, P.D. No. 442, as amended). Since the terms and conditions of government employment are fixed by law, government workers cannot use the same weapons employed by workers in the private sector to secure concessions from their employers. The principle behind labor unionism in private industry is that industrial peace cannot be secured through compulsion by law. Relations between private employers and their

employees rest on an essentially voluntary basis. Subject to the minimum requirements of wage laws and other labor and welfare legislation, the terms and conditions of employment in the unionized private sector are settled through the process of collective bargaining. In government employment, however, it is the legislature and, where properly given delegated power, the administrative heads of government which fix the terms and conditions of employment. And this is effected through statutes or administrative circulars, rules, and regulations, not through collective bargaining agreements. [At p. 13; Emphasis supplied]. Apropos is the observation of the Acting Commissioner of Civil Service, in his position paper submitted to the 1971 Constitutional Convention, and quoted with approval by the Court in Alliance, to wit: It is the stand, therefore, of this Commission that by reason of the nature of the public employer and the peculiar character of the public service, it must necessarily regard the right to strike given to unions in private industry as not applying to public employees and civil service employees. It has been stated that the Government, in contrast to the private employer, protects the interest of all people in the public service, and that accordingly, such conflicting interests as are present in private labor relations could not exist in the relations between government and those whom they employ. [At pp. 16-17; also quoted in National Housing Corporation v. Juco, G.R. No. 64313, January 17,1985,134 SCRA 172,178-179]. E.O. No. 180, which provides guidelines for the exercise of the right to organize of government employees, while clinging to the same philosophy, has, however, relaxed the rule to allow negotiation where the terms and conditions of employment involved are not among those fixed by law. Thus: .SECTION 13. Terms and conditions of employment or improvements thereof, except those that are fixed by law, may be the subject of negotiations between duly recognized employees' organizations and appropriate government authorities. The same executive order has also provided for the general mechanism for the settlement of labor disputes in the public sector to wit: .SECTION 16. The Civil Service and labor laws and procedures, whenever applicable, shall be followed in the resolution of complaints, grievances and cases involving government employees. In case any dispute remains unresolved after exhausting all the available remedies under existing laws and procedures, the parties may jointly refer the dispute to the [Public Sector Labor- Management] Council for appropriate action.

Government employees may, therefore, through their unions or associations, either petition the Congress for the betterment of the terms and conditions of employment which are within the ambit of legislation or negotiate with the appropriate government agencies for the improvement of those which are not fixed by law. If there be any unresolved grievances, the dispute may be referred to the Public Sector Labor Management Council for appropriate action. But employees in the civil service may not resort to strikes, walk-outs and other temporary work stoppages, like workers in the private sector, to pressure the Govemment to accede to their demands. As now provided under Sec. 4, Rule III of the Rules and Regulations to Govern the Exercise of the Right of Government- Employees to Self- Organization, which took effect after the instant dispute arose, "[t]he terms and conditions of employment in the government, including any political subdivision or instrumentality thereof and government- owned and controlled corporations with original charters are governed by law and employees therein shall not strike for the purpose of securing changes thereof." II The strike staged by the employees of the SSS belonging to petitioner union being prohibited by law, an injunction may be issued to restrain it. It is futile for the petitioners to assert that the subject labor dispute falls within the exclusive jurisdiction of the NLRC and, hence, the Regional Trial Court had no jurisdiction to issue a writ of injunction enjoining the continuance of the strike. The Labor Code itself provides that terms and conditions of employment of government employees shall be governed by the Civil Service Law, rules and regulations [Art. 276]. More importantly, E.O. No. 180 vests the Public Sector Labor - Management Council with jurisdiction over unresolved labor disputes involving government employees [Sec. 16]. Clearly, the NLRC has no jurisdiction over the dispute. This being the case, the Regional Trial Court was not precluded, in the exercise of its general jurisdiction under B.P. Blg. 129, as amended, from assuming jurisdiction over the SSS's complaint for damages and issuing the injunctive writ prayed for therein. Unlike the NLRC, the Public Sector Labor - Management Council has not been granted by law authority to issue writs of injunction in labor disputes within its jurisdiction. Thus, since it is the Council, and not the NLRC, that has jurisdiction over the instant labor dispute, resort to the general courts of law for the issuance of a writ of injunction to enjoin the strike is appropriate. Neither could the court a quo be accused of imprudence or overzealousness, for in fact it had proceeded with caution. Thus, after issuing a writ of injunction enjoining the continuance of the strike to prevent any further disruption of public service, the respondent judge, in the same order, admonished the parties to refer the unresolved controversies emanating from their employer- employee relationship to the Public Sector Labor - Management Council for appropriate action [Rollo, p. 86]. III

In their "Petition/Application for Preliminary and Mandatory Injunction," and reiterated in their reply and supplemental reply, petitioners allege that the SSS unlawfully withheld bonuses and benefits due the individual petitioners and they pray that the Court issue a writ of preliminary prohibitive and mandatory injunction to restrain the SSS and its agents from withholding payment thereof and to compel the SSS to pay them. In their supplemental reply, petitioners annexed an order of the Civil Service Commission, dated May 5, 1989, which ruled that the officers of the SSSEA who are not preventively suspended and who are reporting for work pending the resolution of the administrative cases against them are entitled to their salaries, year-end bonuses and other fringe benefits and affirmed the previous order of the Merit Systems Promotion Board. The matter being extraneous to the issues elevated to this Court, it is Our view that petitioners' remedy is not to petition this Court to issue an injunction, but to cause the execution of the aforesaid order, if it has already become final. WHEREFORE, no reversible error having been committed by the Court of Appeals, the instant petition for review is hereby DENIED and the decision of the appellate court dated March 9, 1988 in CA-G.R. SP No. 13192 is AFFIRMED. Petitioners' "Petition/Application for Preliminary and Mandatory Injunction" dated December 13,1988 is DENIED. SO ORDERED.

F. [G.R. No. 124678. July 31, 1997]

DELIA BANGALISAN, LUCILIN CABALFIN, EMILIA DE GUZMAN, CORAZON GOMEZ, CORAZON GREGORIO, LOURDES LAREDO, RODOLFO MARIANO,

WILFREDO MERCADO, LIGAYA MONTANCES and CORAZON PAGPAGUITAN, petitioners, vs. HON. COURT OF APPEALS, THE CIVIL SERVICE COMMISSION and THE SECRETARY OF THE DEPARTMENT OF EDUCATION, CULTURE AND SPORTS, respondents. DECISION REGALADO, J.: This is an appeal by certiorari from the judgment of the Court of Appeals in CA-G.R. SP No. 38316, which affirmed several resolutions of the Civil Service Commission finding petitioners guilty of conduct prejudicial to the best interest of the service, as well as its resolution of April 12, 1996 denying petitioners motion for reconsideration. [1] Petitioners, except Rodolfo Mariano, were among the 800 public school teachers who staged mass actions on September 17 to 19, 1990 to dramatize their grievances concerning, in the main, the alleged failure of the public authorities to implement in a just and correct manner certain laws and measures intended for their material benefit. On September 17, 1990, the Secretary of the Department of Education, Culture and Sports (DECS) issued a Return-to-Work Order. Petitioners failed to comply with said order, hence they were charged by the Secretary with grave misconduct; gross neglect of duty; gross violation of Civil Service law, rules and regulations and reasonable office regulations; refusal to perform official duty; gross insubordination; conduct prejudicial to the best interest of the service; and absence without official leave in violation of PD 807, otherwise known as the Civil Service Decree of the Philippines. They were simultaneously placed under preventive suspension. Despite due notice, petitioners failed to submit their answer to the complaint. On October 30, 1990, the DECS Secretary rendered a decision finding petitioners guilty as charged and dismissing them from the service effective immediately. Acting on the motions for reconsideration filed by petitioners Bangalisan, Gregorio, Cabalfin, Mercado, Montances and Pagpaguitan, the Secretary subsequently modified the penalty of dismissal to suspension for nine months without pay. Petitioner Gomez likewise moved for reconsideration with the DECS and then appealed to the Merit Systems Protection Board (MSPB). The other petitioners also filed individual appeals to the MSPB, but all of their appeals were dismissed for lack of merit. Not satisfied with the aforestated adjudication of their respective cases, petitioners appealed to the Civil Service Commission (CSC). The appeals of petitioners Cabalfin, Montances and Pagpaguitan were dismissed for having been filed out of time. On motion for reconsideration, however, the CSC decided to rule on the merits of their appeal in the interest of justice. Thereafter, the CSC issued Resolution No. 94-1765 finding Cabalfin guilty of conduct prejudicial to the best interest of the service and imposing on him a penalty of six months suspension without pay. The CSC also issued Resolutions Nos. 94-2806

and 94-2384 affirming the penalty of nine months suspension without pay theretofore imposed on petitioners Montances and Pagpaguitan. With respect to the appeals of the other petitioners, the CSC also found them guilty of conduct prejudicial to the best interest of the service. It, however, modified the penalty of nine months suspension previously meted to them to six months suspension with automatic reinstatement in the service but without payment of back wages. All the petitioners moved for reconsideration of the CSC resolutions but these were all denied,[2] except that of petitioner Rodolfo Mariano who was found guilty only of a violation of reasonable office rules and regulations because of his failure to inform the school of his intended absence and to file an application for leave therefor. This petitioner was accordingly given only a reprimand.[3] Petitioners then filed a petition for certiorari with this Court but, on August 29, 1995, their petition was referred to the Court of Appeals pursuant to Revised Administrative Circular No. 1-95.[4] On October 20, 1995, the Court of Appeals dismissed the petition for lack of merit.[5] Petitioners motion for reconsideration was also denied by respondent court,[6] hence the instant petition alleging that the Court of Appeals committed grave abuse of discretion when it upheld the resolutions of the CSC (1) that penalized petitioners whose only offense was to exercise their constitutional right to peaceably assemble and petition the government for redress of grievances; (2) that penalized petitioner Mariano even after respondent commission found out that the specific basis of the charges that former Secretary Cario filed against him was a falsehood; and (3) that denied petitioners their right to back wages covering the period when they were illegally not allowed to teach.[7] It is the settled rule in this jurisdiction that employees in the public service may not engage in strikes. While the Constitution recognizes the right of government employees to organize, they are prohibited from staging strikes, demonstrations, mass leaves, walk-outs and other forms of mass action which will result in temporary stoppage or disruption of public services. The right of government employees to organize is limited only to the formation of unions or associations, without including the right to strike. [8] Petitioners contend, however, that they were not on strike but were merely exercising their constitutional right peaceably to assemble and petition the government for redress of grievances. We find such pretension devoid of merit. The issue of whether or not the mass action launched by the public school teachers during the period from September up to the first half of October, 1990 was a strike has been decided by this Court in a resolution, dated December 18, 1990, in the herein cited case of Manila Public School Teachers Association, et al. vs. Laguio, Jr., supra. It was there held that from the pleaded and admitted facts, these mass actions were to all intents and purposes a strike; they constituted a concerted and unauthorized stoppage of, or absence from, work which it was the teachers duty to perform, undertaken for essentially economic reasons.

It is an undisputed fact that there was a work stoppage and that petitioners purpose was to realize their demands by withholding their services. The fact that the conventional term strike was not used by the striking employees to describe their common course of action is inconsequential, since the substance of the situation, and not its appearance, will be deemed to be controlling.[9] The ability to strike is not essential to the right of association. In the absence of statute, public employees do not have the right to engage in concerted work stoppages for any purpose.[10] Further, herein petitioners, except Mariano, are being penalized not because they exercised their right of peaceable assembly and petition for redress of grievances but because of their successive unauthorized and unilateral absences which produced adverse effects upon their students for whose education they are responsible. The actuations of petitioners definitely constituted conduct prejudicial to the best interest of the service, punishable under the Civil Service law, rules and regulations. As aptly stated by the Solicitor General, It is not the exercise by the petitioners of their constitutional right to peaceably assemble that was punished, but the manner in which they exercised such right which resulted in the temporary stoppage or disruption of public service and classes in various public schools in Metro Manila. For, indeed, there are efficient but non-disruptive avenues, other than the mass actions in question, whereby petitioners could petition the government for redress of grievances. [11] It bears stressing that suspension of public services, however temporary, will inevitably derail services to the public, which is one of the reasons why the right to strike is denied government employees.[12] It may be conceded that the petitioners had valid grievances and noble intentions in staging the mass actions, but that will not justify their absences to the prejudice of innocent school children. Their righteous indignation does not legalize an illegal work stoppage. As expounded by this Court in its aforementioned resolution of December 18, 1990, in the Manila Public School Teachers Association case, ante: It is, of course, entirely possible that petitioners and their member-teachers had and have some legitimate grievances. This much may be conceded. After all, and for one thing, even the employees of the Court have found reason to complain about the manner in which the provisions of the salary standardization law on pay adjustments and position classification have been, or are being, implemented. Nonetheless, what needs to be borne in mind, trite though it may be, is that one wrong cannot be righted by another, and that redress, for even the most justifiable complaints, should not be sought through proscribed or illegal means. The belief in the righteousness of their cause, no matter how deeply and fervently held, gives the teachers concerned no license to abandon their duties, engage in unlawful activity, defy constituted authority and set a bad example to their students. Petitioners also assail the constitutionality of Memorandum Circular No. 6 issued by the Civil Service Commission. The resolution of the said issue is not really necessary in

the case at bar. The argument of petitioners that the said circular was the basis of their liability is off tangent. As a general rule, even in the absence of express statutory prohibition like Memorandum Circular No. 6, public employees are denied the right to strike or engage in a work stoppage against a public employer.[13] The right of the sovereign to prohibit strikes or work stoppages by public employees was clearly recognized at common law. Indeed, it is frequently declared that modern rules which prohibit such strikes, either by statute or by judicial decision, simply incorporate or reassert the common law rule.[14] To grant employees of the public sector the right to strike, there must be a clear and direct legislative authority therefor.[15] In the absence of any express legislation allowing government employees to strike, recognizing their right to do so, or regulating the exercise of the right, employees in the public service may not engage in strikes, walkouts and temporary work stoppages like workers in the private sector.[16] On the issue of back wages, petitioners claim is premised on the allegation that their preventive suspension, as well as the immediate execution of the decision dismissing or suspending them, are illegal. These submissions are incorrect. Section 51 of Executive Order No. 292 provides that (t)he proper disciplining authority may preventively suspend any subordinate officer or employee under his authority pending an investigation, if the charge against such officer or employee involves dishonesty, oppression or grave misconduct, or neglect in the performance of duty, or if there are reasons to believe that the respondent is guilty of charges which would warrant his removal from the service. Under the aforesaid provision, it is the nature of the charge against an officer or employee which determines whether he may be placed under preventive suspension. In the instant case, herein petitioners were charged by the Secretary of the DECS with grave misconduct, gross neglect of duty, gross violation of Civil Service law, rules and regulations, and reasonable office regulations, refusal to perform official duty, gross insubordination, conduct prejudicial to the best interest of the service and absence without official leave (AWOL), for joining the teachers mass actions held at Liwasang Bonifacio on September 17 to 21, 1990. Hence, on the basis of the charges against them, it was within the competence of the Secretary to place herein petitioners under preventive suspension. As to the immediate execution of the decision of the Secretary against petitioners, the same is authorized by Section 47, paragraph (2), of Executive Order No. 292, thus: The Secretaries and heads of agencies and instrumentalities, provinces, cities and municipalities shall have jurisdiction to investigate and decide matters involving disciplinary action against officers and employees under their jurisdiction. Their decisions shall be final in case the penalty imposed is suspension for not more than thirty days or fine in an amount not exceeding thirty days salary. In case the decision rendered by a bureau or office head is appealable to the Commission, the same shall be executory except when the penalty is removal, in which case the same shall be executory only after confirmation by the Secretary concerned.

Petitioners claim of denial of due process must also fail. The records of this case clearly show that they were given opportunity to refute the charges against them but they failed to avail themselves of the same. The essence of due process is simply an opportunity to be heard or, as applied to administrative proceedings, an opportunity to seek reconsideration of the action or ruling complained of.[17] For as long as the parties were given the opportunity to be heard before judgment was rendered, the demands of due process were sufficiently met.[18] Having ruled that the preventive suspension of petitioners and the immediate execution of the DECS decision are in accordance with law, the next query is whether or not petitioners may be entitled to back wages. The issue regarding payment of back salaries during the period of suspension of a member of the civil service who is subsequently ordered reinstated, is already settled in our jurisdiction. Such payment of salaries corresponding to the period when an employee is not allowed to work may be decreed if he is found innocent of the charges which caused the suspension and when the suspension is unjustified. [19] With respect to petitioner Rodolfo Mariano, payment of his back wages is in order. A reading of the resolution of the Civil Service Commission will show that he was exonerated of the charges which formed the basis for his suspension. The Secretary of the DECS charged him with and he was later found guilty of grave misconduct, gross neglect of duty, gross violation of the Civil Service Law, rules and regulations and reasonable office regulations, refusal to perform official duty, gross insubordination, conduct prejudicial to the best interest of the service, and absence without official leave, for his participation in the mass actions on September 18, 20 and 21, 1990. It was his alleged participation in the mass actions that was the basis of his preventive suspension and, later, his dismissal from the service. However, the Civil Service Commission, in the questioned resolution, made a finding that Mariano was not involved in the mass actions but was absent because he was in Ilocos Sur to attend the wake and interment of his grandmother. Although the CSC imposed upon him the penalty of reprimand, the same was for his violation of reasonable office rules and regulations because he failed to inform the school of his intended absence and neither did he file an application for leave covering such absences.[20] Under Section 23 of the Rules Implementing Book V of Executive Order No. 292 and other pertinent civil service laws, in violations of reasonable office rules and regulations, the first offense is punishable by reprimand. To deny petitioner Mariano his back wages during his suspension would be tantamount to punishing him after his exoneration from the charges which caused his dismissal from the service.[21] However, with regard to the other petitioners, the payment of their back wages must be denied. Although the penalty imposed on them was only suspension, they were not completely exonerated of the charges against them. The CSC made specific findings that, unlike petitioner Mariano, they indeed participated in the mass actions. It will be noted that it was their participation in the mass actions that was the very basis of the charges against them and their subsequent suspension.

The denial of salary to an employee during the period of his suspension, if he should later be found guilty, is proper because he had given ground for his suspension. It does not impair his constitutional rights because the Constitution itself allows suspension for cause as provided by law and the law provides that an employee may be suspended pending an investigation or by way of penalty. [22] Moreover, the general proposition is that a public official is not entitled to any compensation if he has not rendered any service. As he works, he shall earn. Since petitioners did not work during the period for which they are now claiming salaries, there can be no legal or equitable basis to order the payment of such salaries. [23] It is also noteworthy that in its resolutions, the Civil Service Commission expressly denied petitioners right to back wages. In the case of Yacia vs. City of Baguio,[24] the decision of the Commissioner of Civil Service ordering the dismissal of a government employee on the ground of dishonesty was immediately executed pending appeal, but, on appeal, the Civil Service Board of Appeals modified that penalty to a fine equivalent to six months pay. We ruled that the claim of an employee for back wages, for the period during which he was not allowed to work because of the execution of the decision of the Commissioner, should be denied. The appeal boards modified decision did not exonerate the employee nor did it affect the validity of his dismissal or separation from work pending appeal, as ordered by the Civil Service Commissioner. Such separation from work pending his appeal remained valid and effective until it was set aside and modified with the imposition of the lesser penalty by the appeals board. If the Civil Service Appeals Board had intended to grant him back salaries and to reduce his penalty to six months fine deductible from such unearned back salaries, the board could and should have so expressly stated in its decision. WHEREFORE, the decision of the Court of Appeals is hereby AFFIRMED, but with the MODIFICATION that petitioner Rodolfo Mariano shall be given back wages without deduction or qualification from the time he was suspended until his actual reinstatement which, under prevailing jurisprudence, should not exceed five years. SO ORDERED.

G. [G.R. No. 147080. April 26, 2005]

CAPITOL MEDICAL CENTER, INC., petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION, JAIME IBABAO, JOSE BALLESTEROS, RONALD CENTENO, NARCISO SARMIENTO, EDUARDO CANAVERAL, SHERLITO DELA CRUZ, SOFRONIO COMANDAO, MARIANO GALICIA, RAMON MOLOD, CARMENCITA SARMIENTO, HELEN MOLOD, ROSA COMANDAO,

ANGELITO CUIZON, ALEX MARASIGAN, JESUS CEDRO, ENRICO ROQUE, JAY PERILLA, HELEN MENDOZA, MARY GLADYS GEMPEROSO, NINI BAUTISTA, ELENA MACARUBBO, MUSTIOLA SALVACION DAPITO, ALEXANDER MANABE, MICHAEL EUSTAQUIO, ROSE AZARES, FERNANDO MANZANO, HENRY VERA CRUZ, CHITO MENDOZA, FREDELITA TOMAYAO, ISABEL BRUCAL, MAHALKO LAYACAN, RAINIER MANACSA, KAREN VILLARENTE, FRANCES ACACIO, LAMBERTO CONTI, LORENA BEACH, JUDILAH RAVALO, DEBORAH NAVE, MARILEN CABALQUINTO, EMILIANA RIVERA, MA. ROSARIO URBANO, ROWENA ARILLA, CAPITOL MEDICAL CENTER EMPLOYEES ASSOCIATION-AFW, GREGORIO DEL PRADO, ARIEL ARAJA, and JESUS STA. BARBARA, JR., respondents. DECISION CALLEJO, SR., J.: This is a petition for review of the Decision[1] of the Court of Appeals (CA) in CAG.R. SP No. 57500 and its Resolution denying the motion for reconsideration thereof.

The Antecedents[2] Whether the respondent Capitol Medical Center Employees Association-Alliance of Filipino Workers (the Union, for brevity) was the exclusive bargaining agent of the rankand-file employees of the petitioner Capitol Medical Center, Inc. had been the bone of contention between the Union and the petitioner. The petitioners refusal to negotiate for a collective bargaining agreement (CBA) resulted in a union-led strike on April 15, 1993. The Union had to contend with another union the Capitol Medical Center Alliance of Concerned Employees (CMC-ACE) which demanded for a certification election among the rank-and-file employees of the petitioner. Med-Arbiter Brigida Fadrigon granted the petition, and the matter was appealed to the Secretary of Labor and Employment (SOLE). Undersecretary Bienvenido E. Laguesma rendered a Resolution on November 18, 1994 granting the appeal. He, likewise, denied the motion filed by the petitioner and the CMC-ACE. The latter thereafter brought the matter to the Court which rendered judgment on February 4, 1997 affirming the resolution of Undersecretary Laguesma, thus: 1. Dismissing the petition for certification election filed by the Capitol Medical Center Alliance of Concerned Employees-United Filipino Services Workers for lack of merit; and 2. Directing the management of the Capitol Medical Center to negotiate a CBA with the Capitol Medical Center Employees Association-Alliance of Filipino Workers, the certified bargaining agent of the rank-and-file employees.[3]

The decision of the Court became final and executory. Thereafter, in a Letter dated October 3, 1997 addressed to Dr. Thelma N. Clemente, the President and Director of the petitioner, the Union requested for a meeting to discuss matters pertaining to a negotiation for a CBA, conformably with the decision of the Court. [4] However, in a Letter to the Union dated October 10, 1997, Dr. Clemente rejected the proposed meeting, on her claim that it was a violation of Republic Act No. 6713 and that the Union was not a legitimate one. On October 15, 1997, the petitioner filed a Petition for the Cancellation of the Unions Certificate of Registration with the Department of Labor and Employment (DOLE) on the following grounds: 3) Respondent has failed for several years to submit annually its annual financial statements and other documents as required by law. For this reason, respondent has long lost its legal personality as a union. 4) Respondent also engaged in a strike which has been declared illegal by the National Labor Relations Commission.[5] Apparently unaware of the petition, the Union reiterated its proposal for CBA negotiations in a Letter dated October 16, 1997 and suggested the date, time and place of the initial meeting. The Union further reiterated its plea in another Letter [6] dated October 28, 1997, to no avail. Instead of filing a motion with the SOLE for the enforcement of the resolutions of Undersecretary Laguesma as affirmed by this Court, the Union filed a Notice of Strike on October 29, 1997 with the National Conciliation and Mediation Board (NCMB), serving a copy thereof to the petitioner. The Union alleged as grounds for the projected strike the following acts of the petitioner: (a) refusal to bargain; (b) coercion on employees; and (c) interference/ restraint to self-organization.[7] A series of conferences was conducted before the NCMB (National Capital Region), but no agreement was reached. On November 6, 1997, the petitioner even filed a Letter with the Board requesting that the notice of strike be dismissed;[8] the Union had apparently failed to furnish the Regional Branch of the NCMB with a copy of a notice of the meeting where the strike vote was conducted. On November 20, 1997, the Union submitted to the NCMB the minutes [9] of the alleged strike vote purportedly held on November 10, 1997 at the parking lot in front of the petitioners premises, at the corner of Scout Magbanua Street and Panay Avenue, Quezon City. It appears that 178 out of the 300 union members participated therein, and the results were as follows: 156 members voted to strike; 14 members cast negative votes; and eight votes were spoiled.[10] On November 28, 1997, the officers and members of the Union staged a strike. Subsequently, on December 1, 1997, the Union filed an ex parte motion with the DOLE, praying for its assumption of jurisdiction over the dispute. The Union likewise prayed for the imposition of appropriate legal sanctions, not limited to contempt and other penalties, against the hospital director/president and other responsible corporate officers for their continuous refusal, in bad faith, to bargain collectively with the Union, to

adjudge the same hospital director/president and other corporate officers guilty of unfair labor practices, and for other just, equitable and expeditious reliefs in the premises.[11] On December 4, 1997, the SOLE issued an Order, assuming jurisdiction over the ongoing labor dispute. The decretal portion of the order reads: WHEREFORE, this Office now assumes jurisdiction over the labor disputes at Capitol Medical Center pursuant to Article 263(g) of the Labor Code, as amended. Consequently, all striking workers are directed to return to work within twenty-four (24) hours from the receipt of this Order and the management to resume normal operations and accept back all striking workers under the same terms and conditions prevailing before the strike. Further, parties are directed to cease and desist from committing any act that may exacerbate the situation. Moreover, parties are hereby directed to submit within 10 days from receipt of this Order proposals and counter-proposals leading to the conclusion of the collective bargaining agreements in compliance with aforementioned Resolution of the Office as affirmed by the Supreme Court. SO ORDERED.[12] In obedience to the order of the SOLE, the officers and members of the Union stopped their strike and returned to work. For its part, the petitioner filed a petition[13] to declare the strike illegal with the National Labor Relations Commission (NLRC), docketed as NLRC NCR Case No. 0012-08644-97. In its position paper, the petitioner appended the affidavit of Erwin Barbacena, the overseer of the property across the hospital which was being used as a parking lot, at the corner of Scout Magbanua Street and Panay Avenue, Quezon City. Also included were the affidavits of Simon J. Tingzon and Reggie B. Barawid, the petitioners security guards assigned in front of the hospital premises. They attested to the fact that no secret balloting took place at the said parking lot from 6:00 a.m. to 7:00 p.m. of November 10, 1997.[14] The petitioner also appended the affidavit of Henry V. Vera Cruz, who alleged that he was a member of the Union and had discovered that signatures on the Statements of Cash Receipt Over Disbursement submitted by the Union to the DOLE purporting to be his were not his genuine signatures; [15] the affidavits of 17 of its employees, who declared that no formal voting was held by the members of the Union on the said date, were also submitted. The latter employees also declared that they were not members of any union, and yet were asked to sign documents purporting to be a strike vote attendance and unnumbered strike vote ballots on different dates from November 8 to 11, 1997. In their position paper, the respondents appended the joint affidavit of the Union president and those members who alleged that they had cast their votes during the strike vote held on November 10, 1997.[16] In the meantime, on September 30, 1998, the Regional Director of the DOLE rendered a Decision denying the petition for the cancellation of the respondent Unions

certificate of registration. The decision was affirmed by the Director of the Bureau of Labor Relations on December 29, 1998. In a parallel development, Labor Arbiter Facundo L. Leda rendered a Decision on December 23, 1998 in NLRC NCR Case No. 00-12-08644-97 in favor of the petitioner, and declared the strike staged by the respondents illegal. The fallo of the decision reads: 1. Declaring as illegal the strike staged by the respondents from November 28, 1997 to December 5, 1997; 2. Declaring respondent Jaime Ibabao, in his capacity as union president, the other union officers, and respondents Ronald Q. Centeno, Michael Eustaquio and Henry Vera Cruz to have lost their employment status with petitioner; and 3. Ordering the above respondents to pay, jointly and severally, petitioner the amount of Two Hundred Thousand Pesos (P200,000.00) by way of damages.[17] The Labor Arbiter ruled that no voting had taken place on November 10, 1997; moreover, no notice of such voting was furnished to the NCMB at least twenty-four (24) hours prior to the intended holding of the strike vote. According to the Labor Arbiter, the affidavits of the petitioners 17 employees who alleged that no strike vote was taken, and supported by the affidavit of the overseer of the parking lot and the security guards, must prevail as against the minutes of the strike vote presented by the respondents. The Labor Arbiter also held that in light of Article 263(9) of the Labor Code, the respondent Union should have filed a motion for a writ of execution of the resolution of Undersecretary Laguesma which was affirmed by this Court instead of staging a strike. The respondents appealed the decision to the NLRC which rendered a Decision[18] on June 14, 1999, granting their appeal and reversing the decision of the Labor Arbiter. The NLRC also denied the petitioners petition to declare the strike illegal. In resolving the issue of whether the union members held a strike vote on November 10, 1997, the NLRC ruled as follows: We find untenable the Labor Arbiters finding that no actual strike voting took place on November 10, 1997, claiming that this is supported by the affidavit of Erwin Barbacena, the overseer of the parking lot across the hospital, and the sworn statements of nineteen (19) (sic) union members. While it is true that no strike voting took place in the parking lot which he is overseeing, it does not mean that no strike voting ever took place at all because the same was conducted in the parking lot immediately/directly fronting, not across, the hospital building (Annexes 1-J, 1-K to 1-K-6). Further, it is apparent that the nineteen (19) (sic) hospital employees, who recanted their participation in the strike voting, did so involuntarily for fear of loss of employment, considering that their Affidavits are uniform and pro forma(Annexes H-2 to H-19).[19] The NLRC ruled that under Section 7, Rule XXII of DOLE Order No. 9, Series of 1997, absent a showing that the NCMB decided to supervise the conduct of a secret

balloting and informed the union of the said decision, or that any such request was made by any of the parties who would be affected by the secret balloting and to which the NCMB agreed, the respondents were not mandated to furnish the NCMB with such notice before the strike vote was conducted.[20] The petitioner filed a motion for the reconsideration of the decision, but the NLRC denied the said motion on September 30, 1999.[21] The petitioner filed a petition for certiorari with the CA assailing the decision and resolution of the NLRC on the following allegation: PUBLIC RESPONDENT NATIONAL LABOR RELATIONS COMMISSION (NLRC) COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION, ACTED CAPRICIOUSLY, AND CONTRAVENED THE LAW AND ESTABLISHED JURISPRUDENCE IN REVERSING THE LABOR ARBITERS DECISION DATED DECEMBER 23, 1998 (ANNEX E) AND IN UPHOLDING THE LEGALITY OF THE STRIKE STAGED BY PRIVATE RESPONDENTS FROM NOVEMBER 28, 1997 TO DECEMBER 5, 1997.[22] On September 29, 2000, the CA rendered judgment dismissing the petition and affirming the assailed decision and resolution of the NLRC. The petitioner filed the instant petition for review on certiorari under Rule 45 of the Rules of Court on the following ground: THE COURT OF APPEALS GRAVELY ERRED IN UPHOLDING THE NLRCS FINDING THAT RESPONDENTS COMPLIED WITH THE LEGAL REQUIREMENTS FOR STAGING THE SUBJECT STRIKE.[23] The petitioner asserts that the NLRC and the CA erred in holding that the submission of a notice of a strike vote to the Regional Branch of the NCMB as required by Section 7, Rule XXII of the Omnibus Rules Implementing the Labor Code, is merely directory and not mandatory. The use of the word shall in the rules, the petitioner avers, indubitably indicates the mandatory nature of the respondent Unions duty to submit the said notice of strike vote. The petitioner contends that the CA erred in affirming the decision of the NLRC which declared that the respondents complied with all the requirements for a lawful strike. The petitioner insists that, as gleaned from the affidavits of the 17 union members and that of the overseer, and contrary to the joint affidavit of the officers and some union members, no meeting was held and no secret balloting was conducted on November 10, 1997. The petitioner faults the CA and the NLRC for holding that a meeting for a strike vote was held on the said date by the respondents, despite the fact that the NLRC did not conduct an ocular inspection of the area where the respondents members allegedly held the voting. The petitioner also points out that it adduced documentary evidence in the form of affidavits executed by 17 members of the respondent union which remained unrebutted. The petitioner also posits that the CA and the NLRC erred in reversing the

finding of the Labor Arbiter; furthermore, there was no need for the respondent union to stage a strike on November 28, 1997 because it had filed an urgent motion with the DOLE for the enforcement and execution of the decision of this Court in G.R. No. 118915. The petition is meritorious. We agree with the petitioner that the respondent Union failed to comply with the second paragraph of Section 10, Rule XXII of the Omnibus Rules of the NLRC which reads: Section 10. Strike or lockout vote. A decision to declare a strike must be approved by a majority of the total union membership in the bargaining unit concerned obtained by secret ballot in meetings or referenda called for the purpose. A decision to declare a lockout must be approved by a majority of the Board of Directors of the employer, corporation or association or the partners obtained by a secret ballot in a meeting called for the purpose. The regional branch of the Board may, at its own initiative or upon the request of any affected party, supervise the conduct of the secret balloting. In every case, the union or the employer shall furnish the regional branch of the Board and notice of meetings referred to in the preceding paragraph at least twenty-four (24) hours before such meetings as well as the results of the voting at least seven (7) days before the intended strike or lockout, subject to the cooling-off period provided in this Rule. Although the second paragraph of Section 10 of the said Rule is not provided in the Labor Code of the Philippines, nevertheless, the same was incorporated in the Omnibus Rules Implementing the Labor Code and has the force and effect of law. [24] Aside from the mandatory notices embedded in Article 263, paragraphs (c) and (f) of the Labor Code, a union intending to stage a strike is mandated to notify the NCMB of the meeting for the conduct of strike vote, at least twenty-four (24) hours prior to such meeting. Unless the NCMB is notified of the date, place and time of the meeting of the union members for the conduct of a strike vote, the NCMB would be unable to supervise the holding of the same, if and when it decides to exercise its power of supervision. In National Federation of Labor v. NLRC,[25] the Court enumerated the notices required by Article 263 of the Labor Code and the Implementing Rules, which include the 24hour prior notice to the NCMB: 1) A notice of strike, with the required contents, should be filed with the DOLE, specifically the Regional Branch of the NCMB, copy furnished the employer of the union; 2) A cooling-off period must be observed between the filing of notice and the actual execution of the strike thirty (30) days in case of bargaining deadlock and fifteen (15) days in case of unfair labor practice. However, in the case of union busting where the unions existence is threatened, the cooling-off period need not be observed.

4) Before a strike is actually commenced, a strike vote should be taken by secret balloting, with a 24-hour prior notice to NCMB. The decision to declare a strike requires the secret-ballot approval of majority of the total union membership in the bargaining unit concerned. 5) The result of the strike vote should be reported to the NCMB at least seven (7) days before the intended strike or lockout, subject to the cooling-off period. A union is mandated to notify the NCMB of an impending dispute in a particular bargaining unit via a notice of strike. Thereafter, the NCMB, through its conciliatormediators, shall call the parties to a conference at the soonest possible time in order to actively assist them in exploring all possibilities for amicable settlement. In the event of the failure in the conciliation/mediation proceedings, the parties shall be encouraged to submit their dispute for voluntary arbitration. However, if the parties refuse, the union may hold a strike vote, and if the requisite number of votes is obtained, a strike may ensue. The purpose of the strike vote is to ensure that the decision to strike broadly rests with the majority of the union members in general and not with a mere minority, and at the same time, discourage wildcat strikes, union bossism and even corruption.[26] A strike vote report submitted to the NCMB at least seven days prior to the intended date of strike ensures that a strike vote was, indeed, taken. In the event that the report is false, the seven-day period affords the members an opportunity to take the appropriate remedy before it is too late.[27] The 15 to 30 day cooling-off period is designed to afford the parties the opportunity to amicably resolve the dispute with the assistance of the NCMB conciliator/mediator,[28] while the seven-day strike ban is intended to give the DOLE an opportunity to verify whether the projected strike really carries the imprimatur of the majority of the union members.[29] The requirement of giving notice of the conduct of a strike vote to the NCMB at least 24 hours before the meeting for the said purpose is designed to (a) inform the NCMB of the intent of the union to conduct a strike vote; (b) give the NCMB ample time to decide on whether or not there is a need to supervise the conduct of the strike vote to prevent any acts of violence and/or irregularities attendant thereto; and (c) should the NCMB decide on its own initiative or upon the request of an interested party including the employer, to supervise the strike vote, to give it ample time to prepare for the deployment of the requisite personnel, including peace officers if need be. Unless and until the NCMB is notified at least 24 hours of the unions decision to conduct a strike vote, and the date, place, and time thereof, the NCMB cannot determine for itself whether to supervise a strike vote meeting or not and insure its peaceful and regular conduct. The failure of a union to comply with the requirement of the giving of notice to the NCMB at least 24 hours prior to the holding of a strike vote meeting will render the subsequent strike staged by the union illegal. In this case, the respondent Union failed to comply with the 24-hour prior notice requirement to the NCMB before it conducted the alleged strike vote meeting on November 10, 1997. As a result, the petitioner complained that no strike vote meeting ever took place and averred that the strike staged by the respondent union was illegal.

Conformably to Article 264 of the Labor Code of the Philippines [30] and Section 7, Rule XXII of the Omnibus Rules Implementing the Labor Code,[31] no labor organization shall declare a strike unless supported by a majority vote of the members of the union obtained by secret ballot in a meeting called for that purpose. The requirement is mandatory and the failure of a union to comply therewith renders the strike illegal.[32] The union is thus mandated to allege and prove compliance with the requirements of the law. In the present case, there is a divergence between the factual findings of the Labor Arbiter, on the one hand, and the NLRC and the CA, on the other, in that the Labor Arbiter found and declared in his decision that no secret voting ever took place in the parking lot fronting the hospital on November 10, 1997 by and among the 300 members of the respondent Union. Erwin Barbacena, the overseer of the only parking lot fronting the hospital, and security guards Simon Tingzon and Reggie Barawid, declared in their respective affidavits that no secret voting ever took place on November 10, 1997; 17 employees of the petitioner also denied in their respective statements that they were not members of the respondent Union, and were asked to merely sign attendance papers and unnumbered votes. The NLRC and the CA declared in their respective decisions that the affidavits of the petitioners 17 employees had no probative weight because the said employees merely executed their affidavits out of fear of losing their jobs. The NLRC and the CA anchored their conclusion on their finding that the affidavits of the employees were uniform and pro forma. We agree with the finding of the Labor Arbiter that no secret balloting to strike was conducted by the respondent Union on November 10, 1997 at the parking lot in front of the hospital, at the corner of Scout Magbanua Street and Panay Avenue, Quezon City. This can be gleaned from the affidavit of Barbacena and the joint affidavit of Tingzon and Barawid, respectively: 1. That I am working as an overseer of a parking lot owned by Mrs. Madelaine Dionisio and located right in front of the Capitol Medical Center, specifically at the corner of Scout Magbanua Street and Panay Avenue, Quezon City; 2. That on November 10, 1997, during my entire tour of duty from 6:00 a.m. to 6:00 p.m., no voting or election was conducted in the aforementioned parking space for employees of the Capitol Medical Center and/or their guests, or by any other group for that matter.[33] 1. That I, Simon J. Tingzon, am a security officer of Veterans Philippine Scout Security Agency (hereinafter referred to as VPSSA), assigned, since July 1997 up to the present, as Security Detachment Commander at Capitol Medical Center (hereinafter referred to as CMC) located at Scout Magbanua corner Panay Avenue, Quezon City; 2. That my (Tingzon) functions as such include over-all in charge of security of all buildings and properties of CMC, and roving in the entire premises including the parking lots of all the buildings of CMC;

3. That I, Reggie B. Barawid, am a security guard of VPSSA, assigned, since June 1997 up to the present, as security guard at CMC; 4. That my (Barawid) functions as such include access control of all persons coming in and out of CMCs buildings and properties. I also sometimes guard the parking areas of CMC; 5. That on November 10, 1997, both of us were on duty at CMC from 7:00 a.m. to 7:00 p.m., with me (Barawid) assigned at the main door of the CMCs Main Building along Scout Magbanua St.; 6. That on said date, during our entire tour of duty, there was no voting or election conducted in any of the four parking spaces for CMC personnel and guests. [34] The allegations in the foregoing affidavits belie the claim of the respondents and the finding of the NLRC that a secret balloting took place on November 10, 1997 in front of the hospital at the corner of Scout Magbanua Street and Panay Avenue, Quezon City. The respondents failed to prove the existence of a parking lot in front of the hospital other than the parking lot across from it. Indeed, 17 of those who purportedly voted in a secret voting executed their separate affidavits that no secret balloting took place on November 10, 1997, and that even if they were not members of the respondent Union, were asked to vote and to sign attendance papers. The respondents failed to adduce substantial evidence that the said affiants were coerced into executing the said affidavits. The bare fact that some portions of the said affidavits are similarly worded does not constitute substantial evidence that the petitioner forced, intimidated or coerced the affiants to execute the same. IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The Decisions of the Court of Appeals and NLRC are SET ASIDE AND REVERSED. The Decision of the Labor Arbiter is REINSTATED. No costs. SO ORDERED.

H. GR No. 59743, May 31, 1982 ] NATIONAL FEDERATION OF SUGAR WORKERS v. ETHELWOLDO R. OVEJERA

199 Phil. 537

PLANA, J.: This is a petition for prohibition seeking to annul the decision dated February 20, 1982 of Labor Arbiter Ethelwoldo R. Ovejera of the National Labor Relations Commission (NLRC) with station at the Regional Arbitration Branch No. VI-A, Bacolod City, which, among others, declared illegal the ongoing strike of the National Federation of Sugar Workers (NFSW) at the Central Azucarera de la Carlota (CAC), and to restrain the implementation thereof. I. FACTS 1. NFSW has been the bargaining agent of CAC rank and file employees (about 1200 of more than 2000 personnel) and has concluded with CAC a collective bargaining agreement effective February 16, 1981 - February 15, 1984. Under Art. VII, Sec. 5 of the said CBA "Bonuses - The parties also agree to maintain the present practice on the grant of Christmas bonus, milling bonus, and amelioration bonus to the extent as the latter is required by law." The Christmas and milling bonuses amount to 1-1/2 months' salary. 2. On November 28, 1981, NFSW struck allegedly to compel the payment of the 13th month pay under PD 851, in addition to the Christmas, milling and amelioration bonuses being enjoyed by CAC workers. 3. To settle the strike, a compromise agreement was concluded between CAC and NFSW on November 30, 1981. Under paragraph 4 thereof"The parties agree to abide by the final decision of the Supreme Court in any case involving the 13th Month Pay Law if it is clearly held that the employer is liable to pay a 13th month pay separate and distinct from the bonuses already given." 4. As of November 30, 1981, G.R. No. 51254 (Marcopper Mining Corp. vs. Blas Ople and Amado Inciong, Minister and Deputy Minister of Labor, respectively, and Marcopper Employees Labor Union, Petition for Certiorari and Prohibition) was still pending in the Supreme Court. The Petition had been dismissed on June 11, 1981 on the vote of seven Justices.[1] A motion for reconsideration thereafter filed was denied in a resolution dated December 15, 1981, with only five Justices voting for denial. (3 dissented; 2 reserved their votes; 4 did not take part) On December 18, 1981 - the decision of June 11, 1981 having become final and executory - entry of judgment was made. 5. After the Marcopper decision had become final, NFSW renewed its demand that CAC give the 13th month pay. CAC refused. 6. On January 22, 1982, NFSW filed with the Ministry of Labor and Employment (MOLE) Regional Office in Bacolod City a notice to strike based on nonpayment of the 13th month pay. Six days after, NFSW struck.

7. One day after the commencement of the strike, or on January 29, 1982, a report of the strike-vote was filed by NFSW with MOLE. 8. On February 8, 1982, CAC filed a petition (R.A.B. Case No. 0110-82) with the Regional Arbitration Branch VI-A, MOLE, at Bacolod City to declare the strike illegal, principally for being violative of Batas Pambansa Blg. 130, that is, the strike was declared before the expiration of the 15-day cooling-off period for unfair labor practice (ULP) strikes, and the strike was staged before the lapse of seven days from the submission to MOLE of the result of the strike-vote. 9. After the submission of position papers and hearing, Labor Arbiter Ovejera declared the NFSW strike illegal. The dispositive part of his decision dated February 20, 1982 reads: "Wherefore, premises considered, judgment is hereby rendered: "1. Declaring the strike commenced by NFSW on January 28, 1982, illegal; "2. Directing the Central to resume operations immediately upon receipt hereof; "3. Directing the Central to accept back to work all employees appearing in its payroll as of January 28, 1982 except those covered by the February 1, 1982 memorandum on preventive suspension but without prejudice to the said employees' instituting appropriate actions before this Ministry relative to whatever causes of action they may have obtained proceeding from said memorandum; "4. Directing the Central to pay effective from the date of resumption of operations the salaries of those to be placed on preventive suspension as per February 1, 1982 memorandum during their period of preventive suspension; and "5. Directing, in view of the finding that the subject strike is illegal, NFSW, its officers, members, as well as sympathizers to immediately desist from committing acts that may impair or impede the milling operations of the Central. "The law enforcement authorities are hereby requested to assist in the peaceful enforcement and implementation of this Decision. "SO ORDERED." 10. On February 26, 1982, the NFSW - bypassing the NLRC - filed the instant Petition for prohibition alleging that Labor Arbiter Ovejera, CAC and the PC Provincial Commander of Negros Occidental were threatening to immediately enforce the February 20, 1982 decision which would violate fundamental rights of the petitioner, and praying that "WHEREFORE, on the foregoing considerations, it is prayed of the Honorable Court that on the Petition for Preliminary Injunction, an order, after hearing, issue: "1. Restraining implementation or enforcement of the Decision of February 20, 1982; "2. Enjoining respondents to refrain from the threatened acts violative of the rights of strikers and peaceful picketers; "3. Requiring maintenance of the status quo as of February 20, 1982, until further orders of the Court; and on the Main Petition, judgment be rendered after hearing:

"1. Declaring the Decision of February 20, 1982 null and void; "2. Making the preliminary injunction permanent; "3. Awarding such other relief as may be just in the premises." 11. Hearing was held, after which the parties submitted their memoranda. No restraining order was issued. II. ISSUES The parties have raised a number of issues, including some procedural points. However, considering their relative importance and the impact of their resolution on ongoing labor disputes in a number of industry sectors, we have decided - in the interest of expediency and dispatch - to brush aside non-substantial items and reduce the remaining issues to but two fundamental ones: 1. Whether the strike declared by NFSW is illegal, the resolution of which mainly depends on the mandatory or directory character of the cooling-off period and the 7-day strike ban after report to MOLE of the result of a strike-vote, as prescribed in the Labor Code. 2. Whether under Presidential Decree 851 (13th Month Pay Law), CAC is obliged to give its workers a 13th month salary in addition to Christmas, milling and amelioration bonuses, the aggregate of which admittedly exceeds by far the disputed 13th month pay. (See petitioner's memorandum of April 12, 1982, p. 2; CAC memorandum of April 2, 1982, pp. 3-4.) Resolution of this issue requires an examination of the thrusts and application of PD 851. III. DISCUSSION 1. Articles 264 and 265 of the Labor Code, insofar as pertinent, read: ART. 264. Strikes, picketing and lockouts. - xx xx xx "(c) In cases of bargaining deadlocks, the certified or duly recognized bargaining representative may file a notice of strike with the Ministry (of Labor and Employment) at least thirty (30) days before the intended date thereof. In cases of unfair labor practices, the period of notice shall be shortened to fifteen (15) days; xx xx xx xx xx xx "(e) During the cooling-off period, it shall be the duty of the Ministry to exert all efforts at mediation and conciliation to effect a voluntary settlement. Should the dispute remain unsettled until the lapse of the requisite number of days from the mandatory filing of the notice, the labor union may strike or the employer may declare a lockout. "(f) A decision to declare a strike must be approved by at least two-thirds (2/3) of the total union membership in the bargaining unit concerned by secret ballots in meetings or referenda. A decision to declare a lockout must be approved by at least two-thirds (2/3) of the board of directors of the employer corporation or association or of the partners in a partnership obtained by secret ballot in a meeting called for the purpose. The decision shall be valid for the duration of the dispute based on substantially the same grounds considered when the strike or lockout vote was taken. The Ministry, may at its own initiative or upon the request of any affected party, supervise the conduct of the secret

balloting. In every case, the union or the employer shall furnish the Ministry the results of the voting at least seven (7) days before the intended strike or lockout, subject to the cooling-off period herein provided." (Emphases supplied.) "ART. 265. Prohibited activities. -It shall be unlawful for any labor organization or employer to declare a strike or lockout without first having bargained collectively in accordance with Title VII of this Book or without first having filed the notice required in the preceding Article or without the necessary strike or lockout vote first having been obtained and reported to the Ministry. "It shall likewise be unlawful to declare a strike or lockout after assumption of jurisdiction by the President or the Minister or after certification or submission of the dispute to compulsory or voluntary arbitration or during the pendency of cases involving the same grounds for the strike or lockout." (Emphases supplied.) (a) Language of the law. - The foregoing provisions hardly leave any room for doubt that the cooling-off period in Art. 264(c) and the 7-day strike ban after the strike-vote report prescribed in Art. 264(f) were meant to be, and should be deemed, mandatory. When the law says "the labor union may strike" should the dispute "remain unsettled until the lapse of the requisite number of days (cooling-off period) from the mandatory filing of the notice," the unmistakable implication is that the union may not strike before the lapse of the cooling-off period. Similarly, the mandatory character of the 7-day strike ban after the report on the strike-vote is manifest in the provision that "in every case," the union shall furnish the MOLE with the results of the voting "at least seven (7) days before the intended strike, subject to the (prescribed) cooling-off period." It must be stressed that the requirements of cooling-off period and 7-day strike ban must both be complied with, although the labor union may take a strike vote and report the same within the statutory cooling-off period. If only the filing of the strike notice and the strike-vote report would be deemed mandatory, but not the waiting periods so specifically and emphatically prescribed by law, the purposes (hereafter discussed) for which the filing of the strike notice and strike-vote report is required would not be achieved, as when a strike is declared immediately after a strike notice is served, or when - as in the instant case - the strikevote report is filed with MOLE after the strike had actually commenced. Such interpretation of the law ought not and cannot be countenanced. It would indeed be selfdefeating for the law to imperatively require the filing on a strike notice and strike-vote report without at the same time making the prescribed waiting periods mandatory. (b) Purposes of strike notice and strike-vote report. - In requiring a strike notice and a cooling-off period, the avowed intent of the law is to provide an opportunity for mediation and conciliation. It thus directs the MOLE "to exert all efforts at mediation and conciliation to effect a voluntary settlement" during the cooling-off period. As applied to the CAC-NFSW, dispute regarding the 13th month pay, MOLE intervention could have possibly induced CAC to provisionally give the 13th month pay in order to avert great business loss arising from the projected strike, without prejudice to the subsequent resolution of the legal dispute by competent authorities; or mediation/conciliation could have convinced NFSW to at least postpone the intended

strike so as to avoid great waste and loss to the sugar central, the sugar planters and the sugar workers themselves, if the strike would coincide with the milling season. So, too, the 7-day strike-vote report is not without a purpose. As pointed out by the Solicitor General "Many disastrous strikes have been staged in the past based merely on the insistence of minority groups within the union. The submission of the report gives assurance that a strike vote has been taken and that, if the report concerning it is false, the majority of the members can take appropriate remedy before it is too late." (Answer of public respondents, pp. 17-18.) If the purpose of the required strike notice and strike-vote report are to be achieved, the periods prescribed for their attainment must, as aforesaid, be deemed mandatory. ". . . when a fair interpretation of the statute, which directs acts or proceedings to be done in a certain way, shows the legislature intended a compliance with such provision to be essential to the validity of the act or proceeding, or when some antecedent and prerequisite conditions must exist prior to the exercise of power or must be performed before certain other powers can be exercised, the statute must be regarded as mandatory. So it has been held that, where a statute is founded on public policy [such as the policy to encourage voluntary settlement of disputes without resorting to strikes], those to whom it applies should not be permitted to waive its provisions. (82 C.J.S. 873874. Bracketed words supplied.) (c) Waiting period after strike notice and strike-vote report, valid regulation of right to strike. - To quote Justice Jackson in International Union vs. Wisconsin Employment Relations Board, 336 U.S. 245, at 259 "The right to strike, because of its more serious impact upon the public interest, is more vulnerable to regulation than the right to organize and select representatives for lawful purposes of collective bargaining..." The cooling-off period and the 7-day strike ban after the filing of a strike-vote report, as prescribed in Art. 264 of the Labor Code, are reasonable restrictions and their imposition is essential to attain the policy objectives embodied in the law. We hold that they constitute a valid exercise of the police power of the state. (d) State policy on amicable settlement of criminal liability. - Petitioner contends that since the non-compliance (with PD 851) imputed to CAC is an unfair labor practice which is an offense against the state, the cooling-off period provided in the Labor Code would not apply, as it does not apply to ULP strikes. It is argued that mediation or conciliation in order to settle a criminal offense is not allowed. In the first place, it is at best unclear whether the refusal of CAC to give a 13th month pay to NFSW constitutes a criminal act. Under Sec. 9 of the Rules and Regulations Implementing Presidential Decree No. 851 "Non-payment of the thirteenth-month pay provided by the Decree and these rules shall be treated as money claims cases and shall be processed in accordance with the Rules Implementing the Labor Code of the Philippines and the Rules of the National Labor Relations Commission."

Secondly, the possible dispute settlement, either permanent or temporary, could very well be along legally permissible lines, as indicated in (b) above or assume the form of measures designed to abort the intended strike, rather than compromise criminal liability, if any. Finally, amicable settlement of criminal liability is not inexorably forbidden by law. Such settlement is valid when the law itself clearly authorizes it. In the case of a dispute on the payment of the 13th month pay, we are not prepared to say that its voluntary settlement is not authorized by the terms of Art. 264(e) of the Labor Code, which makes it the duty of the MOLE to exert all efforts at mediation and conciliation to effect a voluntary settlement of labor disputes. (e) NFSW strike is illegal. - The NFSW declared the strike six (6) days after filing a strike notice, i.e., before the lapse of the mandatory cooling-off period. It also failed to file with the MOLE before launching the strike a report on the strike-vote, when it should have filed such report "at least seven (7) days before the intended strike." Under the circumstances, we are perforce constrained to conclude that the strike staged by petitioner is not in conformity with law. This conclusion makes it unnecessary for us to determine whether the pendency of an arbitration case against CAC on the same issue of payment of 13th month pay [R.A.B. No. 512-81, Regional Arbitration Branch No. VIA, NLRC, Bacolod City, in which the National Congress of Unions in the Sugar Industry of the Philippines (NACUSIP) and a number of CAC workers are the complainants, with NFSW as Intervenor seeking the dismissal of the arbitration case as regards unnamed CAC rank and file employees] has rendered illegal the above strike under Art. 265 of the Labor Code which provides: "It shall likewise be unlawful to declare a strike or lockout after assumption of jurisdiction by the President or the Minister, or after certification or submission of the dispute to compulsory or voluntary arbitration or during the pendency of cases involving the same grounds for the strike or lockout." (Emphases supplied.) (2) The Second Issue. - At bottom, the NFSW strike arose from a dispute on the meaning and application of PD 851, with NFSW claiming entitlement to a 13th month pay on top of bonuses given by CAC to its workers, as against the diametrically opposite stance of CAC. Since the strike was just an offshoot of the said dispute, a simple decision on the legality or illegality of the strike would not spell the end of the NFSW-CAC labor dispute. And considering further that there are other disputes and strikes - actual and impending - involving the interpretation and application of PD 851, it is important for this Court to definitively resolve the problem: whether under PD 851, CAC is obliged to give its workers a 13th month salary in addition to Christmas, milling and amelioration bonuses stipulated in a collective bargaining agreement amounting to more than a month's pay. Keenly sensitive to the needs of the workingmen, yet mindful of the mounting production costs that are the woe of capital which provides employment to labor, President Ferdinand E. Marcos issued Presidential Decree No. 851 on 16 December 1975. Thereunder, "all employers are hereby required to pay all their employees receiving a basic salary of not more than P1,000 a month, regardless of the nature of their employment, a 13th month pay not later than December 24 of every year." Exempted from the obligation however are:

"Employers already paying their employees a 13th month pay or its equivalent...." (Section 2.) The evident intention of the law, as revealed by the law itself, was to grant an additional income in the form of a 13th month pay to employees not already receiving the same. Otherwise put, the intention was to grant some relief - not to all workers - but only to the unfortunate ones not actually paid a 13th month salary or what amounts to it, by whatever name called; but it was not envisioned that a double burden would be imposed on the employer already paying his employees a 13th month pay or its equivalent - whether out of pure generosity or on the basis of a binding agreement and, in the latter case, regardless of the conditional character of the grant (such as making the payment dependent on profit), so long as there is actual payment. Otherwise, what was conceived to be a 13th month salary would in effect become a 14th or possibly 15th month pay. This view is justified by the law itself which makes no distinction in the grant of exemption: "Employers already paying their employees a 13th month pay or its equivalent are not covered by this Decree." (P.D. 851.) The Rules Implementing P.D. 851 issued by MOLE immediately after the adoption of said law reinforce this stand. Under Section 3(e) thereof "The term 'its equivalent' ... shall include Christmas bonus, mid-year bonus, profitsharing payments and other cash bonuses amounting to not less than 1/12th of the basic salary but shall not include cash and stock dividends, cost of living allowances and all other allowances regularly enjoyed by the employee, as well as non-monetary benefits. Where an employer pays less than 1/12th of the employee's basic salary, the employer shall pay the difference." (Emphases supplied.) Having been issued by the agency charged with the implementation of PD 851 as its contemporaneous interpretation of the law, the quoted rule should be accorded great weight. Pragmatic considerations also weigh heavily in favor of crediting both voluntary and contractual bonuses for the purpose of determining liability for the 13th month pay. To require employers (already giving their employees a 13th month salary or its equivalent) to give a second 13th month pay would be unfair and productive of undesirable results. To the employer who had acceded and is already bound to give bonuses to his employees, the additional burden of a 13th month pay would amount to a penalty for his munificence or liberality. The probable reaction of one so circumstanced would be to withdraw the bonuses or resist further voluntary grants for fear that if and when a law is passed giving the same benefits, his prior concessions might not be given due credit; and this negative attitude would have an adverse impact on the employees. In the case at bar, the NFSW-CAC collective bargaining agreement provides for the grant to CAC workers of Christmas bonus, milling bonus and amelioration bonus, the aggregate of which is very much more than a worker's monthly pay. When a dispute arose last year as to whether CAC workers receiving the stipulated bonuses would additionally be entitled to a 13th month pay, NFSW and CAC concluded a compromise agreement by which they -

"agree(d) to abide by the final decision of the Supreme Court in any case involving the 13th Month Pay Law if it is clearly held that the employer is liable to pay a 13th month pay separate and distinct from the bonuses already given." When this agreement was forged on November 30, 1981, the original decision dismissing the petition in the aforecited Marcopper case had already been promulgated by this Court. On the votes of only 7 Justices, including the distinguished Chief Justice, the petition of Marcopper Mining Corp. seeking to annul the decision of Labor Deputy Minister Amado Inciong granting a 13th month pay to Marcopper employees (in addition to mid-year and Christmas bonuses under a CBA) had been dismissed. But a motion for reconsideration filed by Marcopper was pending as of November 30, 1981. In December 1981, the original decision was affirmed when this Court finally denied the motion for reconsideration. But the resolution of denial was supported by the votes of only 5 Justices. The Marcopper decision is therefore a Court decision but without the necessary eight votes to be doctrinal. This being so, it cannot be said that the Marcopper decision "clearly held" that "the employer is liable to pay a 13th month pay separate and distinct from the bonuses already given," within the meaning of the NFSW-CAC compromise agreement. At any rate, in view of the rulings made herein, NFSW cannot insist on its claim that its members are entitled to a 13th month pay in addition to the bonuses already paid by CAC. WHEREFORE, the petition is dismissed for lack of merit. No costs. SO ORDERED. Aquino, Guerrero, Escolin, Vasquez, Relova, and Gutierrez, JJ., concur. De Castro, J., joins J. Abad Santos in his separate concurring opinion. Fernando, C.J., and Makasiar, J., files a separate opinion of qualified concurrence on the question of the legality of the strike and of dissent on the interpretation to be accorded Presidential Decree No. 851. Barredo and Melencio-Herrera, JJ., concur in a separate opinion. Teehankee, J., in the result. Concepcion, Jr., J., on leave.

[1]

105 SCRA 75

CONCURRING OPINION ABAD SANTOS, J.: I concur but lest I be accused of inconsistency because in Marcopper Mining Corporation vs. Ople, et al., No. 51254, June 11, 1981, 105 SCRA 75, I voted to dismiss the petition for lack of merit and as a result Marcopper had to give the 13th-month pay

provided in P. D. No. 851 even as its employees under the CBA had mid-year and endof-year bonuses, I have to state that Marcopper and La Carlota have different factual situations as follows: 1. In Marcopper, the CBA clearly stated that the company was obligated to "grant midyear and end-of-year bonuses to employees following years in which it had profitable operations." Thus the payment of the bonuses was contingent upon the realization of profits. If there were no profits, there were to be no bonuses. Accordingly, it was fair and proper to conclude that Marcopper had not shown that it was already paying its employees the 13th-month pay or its equivalent as provided in Sec. 2 of P. D. No. 851. However, in the instant case of La Carlota the obligation of the employer to pay bonuses is not contingent on the realization of profits. The CBA stipulates that the "parties also agree to maintain the present practice on the grant of Christmas bonus, milling bonus, and amelioration bonus to the extent as the latter is required by law." It can thus be said that La Carlota is already paying the equivalent of the 13th-month pay. 2. In Marcopper, the company's liability for the 13th-month pay was determined by no less than the Deputy Minister of Labor, Amado G. Inciong. I have always given much weight to the determination of officers who are tasked with implementing legislation because their expertise qualifies them in making authoritative decisions. In the present case of La Carlota, there has been no determination that the employees are entitled to the 13th-month pay. In fact, a negative conclusion can be implied from the declaration of Labor Arbiter Ovejera that the labor union's strike against La Carlota was illegal.

CONCURRING OPINION BARREDO, J.: At this stage of my tenure in the Supreme Court which is to end in about four months from now, I feel it is but fitting and proper that I make my position clear and unmistakable in regard to certain principles that have to be applied to this labor case now before Us. Few perhaps may have noticed it, but the fact is that in most cases of this nature I have endeavored my very best to fully abide by the part that pertains to the judiciary in the social justice and protection to labor clauses of the Constitution, not alone because I consider it as an obligation imposed by the fundamental law of the land but by natural inclination, perhaps because I began to work as a common worker at the age of thirteen, and I cannot in any sense be considered as a capitalist or managementinclined just because I happen to have joined, within the legal bounds of the position I occupy, some business ventures with the more affluent members of my family and with some good and faithful old time friends. I need not say that I am pro-labor; I only wish to deny most vehemently that I am anti-labor. Having been one of the seven members of the Court who co-signed with our learned Chief Justice the Marcopper "decision" and later on reserved my vote when a motion for reconsideration thereof was filed, for me to concur now by merely co-signing the brilliant opinion of our distinguished colleague, Mr. Justice Plana, is to my mind short of what all

concerned might expect from me. For me to merely vote in support of the judgment herein without any explanation of my peculiar situation does not satisfy my conscience, not to mention that I owe such explanation to those who would all probably be raising their eyebrows since they must come to feel they could depend on me to always vote in favor of labor. The Supreme Court is a court of law and of equity at the same time but, understandably, equity comes in only when law is inadequate to afford the parties concerned the essence of justice, fairness and square dealing. It is to this basic tenet that I am bound by my oath of office before God and our people. Having this ideal in mind, the paramount thought that should dominate my actuations is complete and absolute impartiality in the best light God has given me. Hence, when the aid of the Court is sought on legal grounds, We can resort to equity only when there is no law that can be properly applied. My view of the instant case is that it is one of law, not of equity. It is on this fundamental basis that I have ventured to write this concurrence. Looking back at my concurrence in Marcopper, and guided by the observations in the main opinion herein, as to the doctrinal value of Our decision therein, I have come to the realization, after mature deliberation, that the conclusion reached in the opinion of the Chief Justice may not always be consistent with the evident intent and purpose of Section 2 of P.D. No. 851 which, indeed, unequivocally provides that "(E)mployers already paying their employees a 13th month pay or its equivalent are not covered by this decree", albeit it does not clarify what it means by the "equivalent" of the 13th month pay. Such being the case, nothing can be more proper than for everyone to abide by or at least give due respect to the meaning thereof as has been officially expressed by the usual executive authority called upon to implement the same, none other than the Ministry of Labor (MOLE, for short), unless, of course, the understanding of MOLE appears to be manifestly and palpably erroneous and completely alien to the evident intent of the decree. And Section 3 (e) of the Rules Implementing P.D. 851 issued by MOLE reads thus: "The term 'its equivalent' as used in paragraph c) hereof shall include Christmas bonus, midyear bonus, profit-sharing payments and other cash bonuses amounting to not less than 1/12th of the basic salary but shall not include cash and stock dividends, cost of living allowances and all other allowances regularly enjoyed by the employee, as well as non-monetary benefits. Where an employer pays less than 1/12th of the employee's basic salary, the employer shall pay the difference." Petitioner National Federation of Sugar Workers (NFSW, for short) is now before Us with the plea that because in its agreement with respondent Central Azucarera de la Carlota (CAC, for short) of November 30, 1981 to the effect that: "The parties agree to abide by the final decision of the Supreme Court in any case involving the 13th Month Pay Law if it is clearly held that the employer is liable to pay a 13th month pay separate and distinct from the bonuses already given." (Par. 4) and because this Court dismissed, in legal effect, for lack of necessary votes, the petition in the Marcopper case seeking the setting aside of Deputy Minister Inciong's decision which considered the midyear and Christmas bonuses being given to the Marcopper workers as not the equivalent of the 13th month pay enjoined by P. D. 851,

We should now order CAC to pay NFSW members in the same way as stated in the opinion of the Chief Justice in the Marcopper case. At first glance, such a pause does appear tenable and plausible. But looking deeper at the precise wording of the November 30, 1981 agreement between NFSW and CAC above-quoted, the proposition in the main opinion herein that what must be deemed contemplated in said agreement is that the final decision of the Supreme Court therein referred to must be one wherein it would be "clearly held that the employer is liable to pay 13th month pay separate and distinct from the bonuses already given", compels concurrence on my part. I find said agreement to be definitely worded. There is no room at all for doubt as to the meaning thereof. And tested in the light of such unambiguous terminology of the said agreement, the Marcopper opinion signed by only seven members of this Court, cannot, under the Constitution and prevailing binding legal norms, unfortunately, have doctrinal worth and cannot be considered as stare decisis. Hence, it cannot be said to be the "definite" decision of the Supreme Court the parties (CAC and NFSW) had in mind. Accordingly, it is my considered opinion that NFSW's plea in this case is premature and rather off tangent. I am not unmindful of the possibility or even probability that labor may argue that in signing the November 30, 1981 agreement, NFSW little cared, for it was not fully informed about what doctrinal and what is not doctrinal signify in law. Labor may argue that it is enough that Marcopper workers got their 13th month pay in addition to their bonuses by virtue of the denial by this Supreme Court of Marcopper Company's appeal to Us, and NFSW members should not be left getting less. And it would only be rational to expect labor to invoke in support of their plea no less than the social justice and protection to labor provisions of the Constitution. As I have said at the outset, I am about to leave this Court. Nothing could warm my heart and lift my spirit more than to part with the noble thought that during my tenure of fourteen years in this Supreme Court, I have given labor the most that it has been within my power to give. But again I must emphasize that what is constitutionally ordained, and by that I mean also by God and by our country and people, is for me to jealously guard that the scales of justice are in perfect balance. No fondness for any sector of society, no love for any man or woman, no adherence to any political party, no feeling for any relative or friend nor religious consideration or belief should ever induce me to allow it to tilt in the slightest degree in favor of anyone.

CONCURRING WITH QUALIFICATIONS ON THE QUESTIONS OF THE LEGALITY OF THE STRIKE AND DISSENTING ON THE INTERPRETATION TO BE ACCORDED PRESIDENTIAL DECREE NO. 851 ON THE THIRTEENTH-MONTH ADDITIONAL PAY: FERNANDO, C.J.:

There is at the outset due acknowledgment on my part of the high quality of craftsmanship in the opinion of the Court penned by Justice Efren Plana. It is distinguished by its lucidity. There is the imprint of inevitability in the conclusion reached based on the basic premise that underlies it. So it should be if the decisive consideration is the language used both of the applicable provisions of the Labor Code, Article 264(c), (e), and (f) and Article 265, as well as of Presidential Decree No. 851. In that sense, the decision of the Court can stand the test of scrutiny based on sheer logic. That for me would not suffice. Such an approach, to my mind, is quite limited. The standard that should govern is the one supplied by the Constitution. That is the clear implication of constitutionalism. Anything less would deprive it of its quality as the fundamental law. It is my submission, therefore, that statutes, codes, decrees, administrative rules, municipal ordinances and any other jural norms must be construed in the light of and in accordance with the Constitution. There is this explicit affirmation in the recently decided case of De la Llana v. Alba sustaining the validity of Batas Pambansa Blg. 129 reorganizing the judiciary: "The principle that the Constitution enters into and forms part of every act to avoid any unconstitutional taint must be applied. Nuñez v. Sandiganbayan, promulgated last January, has this relevant excerpt: 'It is true that the other Sections of the Decree could have been so worded as to avoid any constitutional objection. As of now, however, no ruling is called for. The view is given expression in the concurring and dissenting opinion of Justice Makasiar that in such a case, to save the Decree from the dire fate of invalidity, they must be construed in such a way as to preclude any possible erosion on the powers vested in this Court by the Constitution. That is a proposition too plain to be contested. It commends itself for approval.'"[1] 1. It may not be amiss to start with the dissenting portion of this separate opinion. It is worthwhile to recall the decision in Marcopper Mining Corporation v. Hon. Blas Ople.[2] It came from a unanimous Court. It is true that only seven Justices signed the opinion, two of the members of this Tribunal, who participated in the deliberation, Justices Teehankee and Melencio-Herrera having reserved their votes. Justice Concepcion Jr. was on leave. It is accurate, therefore, to state that Marcopper as stated in Justice Plana's opinion, is not doctrinal in character, the necessary eight votes not having been obtained. It is a plurality, as distinguished from a majority opinion. It is quite apparent, however, that there was not a single dissenting vote. There was subsequently a motion for reconsideration. This Court duly weighed the arguments for and against the merit of the unanimous opinion rendered. The resolution denying the motion for reconsideration was not issued until December 15, 1981, on which occasion three Justices dissented.[3] In the brief resolution denying the motion for reconsideration, with five Justices adhering to their original stand,[4] it was set forth that such denial was based "primarily [on] the reason that the arguments advanced had been duly considered and found insufficient to call for a decision other than that promulgated on June 11, 1981, which stands unreversed and unmodified. This is a case involving the social justice concept, which, as pointed out in Carillo v. Allied Workers Association of the Philippines involves 'the effectiveness of the community's effort to assist the economically underprivileged. For under existing conditions, without such succor and support, they might not, unaided, be able to secure justice for themselves.' In an earlier decision, Del Rosario v. De los Santos, it was categorically stated that the social justice principle 'is

the translation into reality of its significance as popularized by the late President Magsaysay: He who has less in life should have more in law.' "[5] In his dissent, Justice Fernandez took issue on the interpretation of social justice by relying on the well-known opinion of Justice Laurel in Calalang v. Williams[6] and concluded: "It is as much to the benefit of labor that the petitioner be accorded social justice. For if the mining companies, like the petitioner, can no longer operate, all the laborers employed by said company shall be laid-off."[7] To reinforce such a conclusion, it was further stated: "The decision in this case is far reaching. It affects all employers similarly situated as the petitioner. The natural reaction of employers similarly situated as the petitioner will be to withdraw gratuities that they have been giving employees voluntarily. In the long run, the laborers will suffer. In the higher interest of all concerned the contention of the petitioner that the mid-year bonus and Christmas bonus that it is giving to the laborers shall be applied to the 13th month pay should be sustained." [8] Such pragmatic consideration is likewise evident in the opinion of the Court in this case. It is quite obvious from the above resolution of denial that the approach based on the Constitution, compelling in its character set forth in the opinion of the Court of June 11, 1981, is the one followed by the members of this Court either adhering to or departing from the previous unanimous conclusion reached. The main reliance, to repeat, is on the social justice provision,[9] as reinforced by the protection to labor provision.[10] As noted, such concepts were enshrined in the 1935 Constitution. [11] The opinion pursued the matter further: "Even then, there was a realization of their importance in vitalizing a regime of liberty not just as immunity from government restraint but as the assumption by the State of an obligation to assure a life of dignity for all, especially the poor and the needy. The expanded social justice and protection to labor provisions of the present Constitution lend added emphasis to the concern for social and economic rights. * * * That was so under the 1935 Constitution. Such an approach is even more valid now. As a matter of fact, in the first case after the applicability of the 1973 Constitution where social and economic rights were involved, this Court in Alfanta v. Noe, through Justice Antonio, stated: 'In the environment of a new social order We can do no less. Thus, under the new Constitution, property ownership has been impressed with a social function. This implies that the owner has the obligation to use his property not only to benefit himself but society as well. Hence, it provides under Section 6 of Article II thereof, that in the promotion of social justice, the State "shall regulate the acquisition, ownership, use, enjoyment, and disposition of private property, and equitably diffuse property ownership and profits." The Constitution also ensures that the worker shall have a just and living wage which should assure for himself and his family an existence worthy of human dignity and give him opportunities for a better life.' Such a sentiment finds expression in subsequent opinions."[12] 2. It thus becomes apparent, therefore, why predicated on what for me is the significance of the social justice and the protection to labor mandates of the Constitution, I cannot, with due respect, concur with my brethren. The stand taken by this Court, I submit, cannot be justified by the hitherto hospitable scope accorded such provisions. It is to the credit of this Administration that even during the period of crisis government, the social and economic rights were fully implemented. As a matter of fact, some critics, not fully informed of the actual state of affairs, would predicate their assessment of its accomplishments in this sphere on their inaccurate and

unsympathetic appraisal of how much success had been achieved. It is a matter of pride for the Philippines that as far back as her 1935 Constitution, provisions assuring liberty in its positive sense, enabling her citizens to live a life of humanity and dignity, were already incorporated. The social and economic rights found therein antedated by thirteen years the Universal Declaration of Human Rights. When it is considered that, as pointed out in the opinion of Justice Antonio in Alfanta, rendered in the first year of the present Constitution, the social justice principle now lends itself to the equitable diffusion of property ownership and profits, it becomes difficult for me to justify why any lurking ambiguity in Presidential Decree No. 851 could be construed against the rights of labor. This Court is not acting unjustly if it promotes social justice. This Court is not acting unjustly if it protects labor. This Court is just being true to its mission of fealty to the Constitution. Under the concept of separation of powers, while the political branches enact the laws and thereafter enforce them, any question as to their interpretation, justiciable in character, is for the courts, ultimately this Tribunal, to decide. That is its sworn duty. It cannot be recreant to such a trust. Its role, therefore, is far from passive. It may be said further that if the object of statutory construction is in the well-known language of Learned Hand "proliferation of purpose," there is warrant for the view that I espouse. That is to attain its basic objective, namely, to cope with the ravages of inflation. Moreover, the Decree only benefits the low-salaried employees. There is thus ample warrant for a more liberal approach. It only remains to be added that there was in Marcopper not only a recognition of the administrative determination by the Minister of Labor as well as the then Deputy Minister of Labor but also an acceptance of the ablywritten memorandum of Solicitor General Mendoza. Hence, to repeat, my inability to concur on this point with my brethren whose views, as I stated earlier, are deserving of the fullest respect. 3. There is, however - and it must be so recognized - an obstacle to the approach above followed. There is an agreement both on the part of management and labor in this case quoted in the main opinion to this effect, "to abide by the final decision of the Supreme Court in any case involving the 13th Month Pay Law if it is clearly held that the employer is liable to pay a 13th month pay separate and distinct from the bonuses already given." Such an obstacle, on further reflection, is not, for me, insurmountable. The only case then within the contemplation of the parties is Marcopper. With the unanimous opinion rendered and a subsequent denial of a motion for reconsideration, it would appear that while it lacked doctrinal force, this Court "clearly held" that there is liability on the part of the employer to pay a 13-month pay separate and distinct from the bonuses already given. Perhaps the parties, especially labor, could have been more accurate and more precise. I take comfort from the view expressed by Justice Cardozo in Wood v. DuffGordon:[13] "The law has outgrown its primitive stage of formalism when the precise word was the sovereign talisman, and every slip was fatal. It takes a broader view today. A promise may be lacking, and yet the whole writing may be 'instinct with an obligation,' imperfectly expressed."[14] 4. Now as to the qualified concurrence. Based on the codal provisions, the finding of the illegality of strike is warranted. That for me does not fully resolve the questions raised by such a declaration. From my reading of the opinion of the Court, it does not go as far as defining the consequences of such illegal strike. Again, the approach I propose to follow is premised on the two basic mandates of social justice and protection to labor, for while

they are obligations imposed on the government by the fundamental law, compulsory arbitration as a result of which there could be a finding of illegality, is worded in permissive, not in mandatory language. It would be, for me, a departure from principles to which this Court has long remained committed, if thereby loss of employment, even loss of seniority rights or other privileges, is ultimately incurred. That is still an open question. The decision has not touched on that basic aspect of this litigation. The issue is not foreclosed. It seems fitting that this brief concurrence and dissent should end with a relevant excerpt from Free Telephone Workers Union v. The Minister of Labor: [15] "It must be stressed anew, however, that the power of compulsory arbitration, while allowable under the Constitution and quite understandable in labor disputes affected with a national interest, to be free from the taint of unconstitutionality, must be exercised in accordance with the constitutional mandate of protection to labor. The arbiter then is called upon to take due care that in the decision to be reached, there is no violation of 'the rights of workers to self-organization, collective bargaining, security of tenure, and just and humane conditions of work.' It is of course manifest that there is such unconstitutional application if a law 'fair on its face and impartial in appearance [is] applied and administered by public authority with an evil eye and an unequal hand.' It does not even have to go that far. An instance of unconstitutional application would be discernible if what is ordained by the fundamental law, the protection of labor, is ignored or disregarded."[16] I am authorized to state that Justice Makasiar joins me in this separate opinion.

I. 315 Phil. 698

ROMERO, J.: Should separation pay and backwages be awarded by public respondent NLRC to participants of an illegal strike? This is the core issue to be decided in these two petitions. Gold City Integrated Port Service, Inc. (INPORT) filed a petition for certiorari against the National Labor Relations Commission (NLRC) assailing the latter's decision in "Gold City Integrated Port Services, Inc. v. Adelo Ebuna, et al." (NLRC RAB X Case No. 50405-85) with twenty-seven private respondents (G.R. No. 103599).[1] This petition has been consolidated with G.R. No. 103599 where the petitioners are the private respondents in instant case and the private respondent is INPORT. For the sake of clarity, INPORT shall be denominated in the case at bench as the petitioner and the employees as private respondents. Instant case arose from the following facts: Early in the morning of April 30, 1985, petitioner's employees stopped working and

gathered in a mass action to express their grievances regarding wages, thirteenth month pay and hazard pay. Said employees were all members of the Macajalar Labor Union - Federation of Free Workers (MLU-FFW) with whom petitioner had an existing collective bargaining agreement. Petitioner was engaged in stevedoring and arrastre services at the port of Cagayan de Oro. The strike paralyzed operations at said port. On the same morning, the strikers filed individual notices of strike ("Kaugalingon nga Declarasyon sa Pag-Welga") with the then Ministry of Labor and Employment. With the failure of conciliation conferences between petitioner and the strikers, INPORT filed a complaint before the Labor Arbiter for Illegal Strike with prayer for a restraining order/preliminary injunction. On May 7, 1985, the National Labor Relations Commission issued a temporary restraining order. Thereafter, majority of the strikers returned to work, leaving herein private respondents who continued their protest.[2] Counsel for private respondents filed a manifestation that petitioner required prior screening conducted by the MLU-FFW before the remaining strikers could be accepted back to work. Meanwhile, counsel for the Macajalar Labor Union (MLU-FFW) filed a "Motion to Drop Most of the Party Respondents From the Above Entitled Case." The 278 employees on whose behalf the motion was filed, claimed that they were duped or tricked into signing the individual notices of strike. After discovering this deception and verifying that the strike was staged by a minority of the union officers and members and without the approval of, or consultation with, majority of the union members, they immediately withdrew their notice of strike and returned to work. The petitioner INPORT, not having interposed any objection, the Labor Arbiter, in his decision dated July 23, 1985, granted their prayer to be excluded as respondents in the complaint for illegal strike. Moreover, petitioner's complaint was directed against the 31 respondents who did not return to work and continued with the strike. For not having complied with the formal requirements in Article 264 of the Labor Code,[3] the strike staged by petitioner's workers on April 30, 1985 was found by the Labor Arbiter to be illegal.[4] The workers who participated in the illegal strike did not, however, lose their employment, since there was no evidence that they participated in illegal acts. After noting that petitioner accepted the other striking employees back to work, the Labor Arbiter held that the private respondents should similarly be allowed to return to work without having to undergo the required screening to be undertaken by their union (MLU-FFW). As regards the six private respondents who were union officers, the Labor Arbiter ruled

that they could not have possibly been "duped or tricked" into signing the strike notice for they were active participants in the conciliation meetings and were thus fully aware of what was going on. Hence, said union officers should be accepted back to work after seeking reconsideration from herein petitioner.[5] The dispositive portion of the decision reads:

"IN VIEW OF THE FOREGOING, it is hereby ordered that the strike undertaken by the officers and majority union members of Macajalar Labor Union-FFW is ILLEGAL contrary to Article 264 of the Labor Code, as amended. Our conclusion on the employment status of the illegal strikers is subject to our discussion above."[6] Both petitioner and private respondents filed motions for reconsideration, which public respondent NLRC treated as appeals.[7] On January 14, 1991, the NLRC affirmed with modification[8] the Arbiter's decision. It held that the concerted action by the workers was more of a "protest action" than a strike. Private respondents, including the six union officers, should also be allowed to work unconditionally to avoid discrimination. However, in view of the strained relations between the parties, separation pay was awarded in lieu of reinstatement. The decretal portion of the Resolution reads:

"WHEREFORE, the decision appealed from is Affirmed with modification in accordance with the foregoing resolution. Complainant INPORT is hereby ordered, in lieu of reinstatement, to pay respondents the equivalent of twelve (12) months salaries each as separation pay. Complainant is further ordered to pay respondents two (2) years backwages based on their last salaries, without qualification or deduction. The appeal of complainant INPORT is Dismissed for lack of merit."[9] Upon petitioner's motion for reconsideration, public respondent modified the above resolution on December 12, 1991.[10] The Commission ruled that since private respondents' were not actually terminated from service, there was no basis for reinstatement. However, it awarded six months' salary as separation pay or financial assistance in the nature of "equitable relief." The award for backwages was also deleted for lack of factual and legal basis. In lieu of backwages, compensation equivalent to P1,000.00 was given. The dispositive portion of the assailed Resolution reads:

"WHEREFORE, the resolution of January 14, 1991 is Modified reducing the award for separation pay to six (6) months each in favor of respondents, inclusive of lawful benefits as well as those granted under the CBA, if any, based on the latest salary of

respondents, as and by way of financial assistance while the award for backwages is Deleted and Set Aside. In lieu thereof, respondents are granted compensation for their sudden loss of employment in the sum of P1,000.00 each. The motion of respondents to implead PPA as third-party respondent is Noted. Except for this modification the rest of the decision sought to be reconsidered shall stand."[11] In the instant petitions for certiorari, petitioner alleges that public respondent Commission committed grave abuse of discretion in awarding private respondents separation pay and backwages despite the declaration that the strike was illegal. On the other hand, private respondents, in their petition, assail the reduction of separation pay and deletion of backwages by the NLRC as constituting grave abuse of discretion. They also allege that the Resolution of January 14, 1991 could not be reconsidered after the unreasonable length of time of eleven months. Before proceeding with the principal issues raised by the parties, it is necessary to clarify public respondent's statements concerning the strike staged by INPORT's employees. In its resolution dated January 14, 1991, the NLRC held that the facts prevailing in the case at bench require a relaxation of the rule that the formal requisites for a declaration of a strike are mandatory. Furthermore, what the employees engaged in was more of a spontaneous protest action than a strike.[12] Nevertheless, the Commission affirmed the Labor Arbiter's decision which declared the strike illegal. A strike, considered as the most effective weapon of labor,[13] is defined as any temporary stoppage of work by the concerted action of employees as a result of an industrial or labor dispute.[14] A labor dispute includes any controversy or matter concerning terms or 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 or not the disputants stand in the proximate relation of employers and employees.[15] Private respondents and their co-workers stopped working and held the mass action on April 30, 1985 to press for their wages and other benefits. What transpired then was clearly a strike, for the cessation of work by concerted action resulted from a labor dispute. The complaint before the Labor Arbiter involved the legality of said strike. The Arbiter correctly ruled that the strike was illegal for failure to comply with the requirements of Article 264 (now Article 263) paragraphs (c) and (f) of the Labor Code.[16]

The individual notices of strike filed by the workers did not conform to the notice required by the law to be filed since they were represented by a union (MLU-FFW) which even had an existing collective bargaining agreement with INPORT. Neither did the striking workers observe the strike vote by secret ballot, cooling-off period and reporting requirements. As we stated in the case of National Federation of Sugar Workers v. Ovejera, [17] the language of the law leaves no room for doubt that the cooling-off period and the sevenday strike ban after the strike-vote report were intended to be mandatory.[18] Article 265 of the Labor Code reads, inter alia:

"(i)t SHALL be unlawful for any labor organization x x x to declare a strike x x x without first having filed the notice required in the preceding Article or without the necessary strike vote first having been obtained and reported to the Ministry." (Emphasis ours) In explaining the above provision, we said:

"In requiring a strike notice and a cooling-off period, the avowed intent of the law is to provide an opportunity for mediation and conciliation. It thus directs the MOLE to exert all efforts at mediation and conciliation to effect a voluntary settlement' during the cooling-off period. x x x xxx

xxx

xxx

The cooling-off period and the 7-day strike ban after the filing of a strike-vote report, as prescribed in Art. 264 of the Labor Code, are reasonable restrictions and their imposition is essential to attain the legitimate policy objectives embodied in the law. We hold that they constitute a valid exercise of the police power of the state."[19] From the foregoing, it is patent that the strike on April 30, 1985 was illegal for failure to comply with the requirements of the law. The effects of such illegal strikes, outlined in Article 265 (now Article 264) of the Labor Code, make a distinction between workers and union officers who participate therein. A union officer who knowingly participates in an illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost their employment status.[20] An ordinary striking worker cannot be terminated for mere participation in an illegal strike. There must be proof that he committed illegal acts during a strike. A union officer, on the other hand, may be terminated from work when he knowingly participates in an illegal strike, and like other workers, when he commits an illegal act during a strike.

In the case at bench, INPORT accepted the majority of the striking workers, including union officers, back to work. Private respondents were left to continue with the strike after they refused to submit to the "screening" required by the company. [21] The question to be resolved now is what these remaining strikers, considering the circumstances of the case, are entitled to receive under the law, if any. Are they entitled, as they claim, to reinstatement or separation pay and backwages? In his decision, the Labor Arbiter ordered INPORT to reinstate/accept the remaining workers as well as to accept the remaining union officers after the latter sought reconsideration from INPORT.[22] The NLRC on January 14, 1991, modified the above decision by ordering INPORT to pay private respondents the equivalent of twelve months in salary as separation pay in lieu of reinstatement and two years' backwages.[23] On reconsideration, public respondent modified its original award and reduced the separation pay to six months, deleted the award for backwages and instead awarded P1,000.00 as compensation for their sudden loss of employment.[24] Under the law, an employee is entitled to reinstatement and to his full backwages when he is unjustly dismissed.[25] Reinstatement means restoration to a state or condition from which one had been removed or separated. Reinstatement and backwages are separate and distinct reliefs given to an illegally dismissed employee.[26] Separation pay is awarded when reinstatement is not possible, due, for instance, to strained relations between employer and employee. It is also given as a form of financial assistance when a worker is dismissed in cases such as the installation of labor saving devices, redundancy, retrenchment to prevent losses, closing or cessation of operation of the establishment, or in case the employee was found to have been suffering from a disease such that his continued employment is prohibited by law.[27] Separation pay is a statutory right defined as the amount that an employee receives at the time of his severance from the service and is designed to provide the employee with the wherewithal during the period that he is looking for another employment.[28] It is oriented towards the immediate future, the transitional period the dismissed employee must undergo before locating a replacement job.[29] Hence, an employee dismissed for causes other than those cited above is not entitled to separation pay.[30] Well-settled is it that separation pay shall be allowed only in those

instances where the employee is validly dismissed for causes other than serious misconduct or those reflecting on his moral character.[31] Backwages, on the other hand, is a form of relief that restores the income that was lost by reason of unlawful dismissal.[32] It is clear from the foregoing summary of legal provisions and jurisprudence that there must generally be unjust or illegal dismissal from work, before reinstatement and backwages may be granted. And in cases where reinstatement is not possible or when dismissal is due to valid causes, separation pay may be granted. Private respondents contend that they were terminated for failure to submit to the controversial "screening" requirement. Public respondent Commission took the opposite view and held:

"As the evidence on record will show, respondents were not actually terminated from the service. They were merely made to submit to a screening committee as a prerequisite for readmission to work. While this condition was found not wholly justified, the fact remains that respondents who are resistant to such procedure are partly responsible for the delay in their readmission back to work. Thus, We find justifiable basis in further modifying our resolution of January 14, 1991 in accordance with the equities of the case. We shall therefore recall the award for backwages for lack of factual and legal basis. The award for separation pay shall likewise (be) reasonably reduced. Normally, severance benefit is granted as an alternative remedy to reinstatement. And since there is no dismissal to speak of, there is no basis for awarding reinstatement as a legal remedy. In lieu thereof, We shall grant herein respondents separation pay as and by way of financial assistance in the nature of an equitable relief.'"[33] We find that private respondents were indeed dismissed when INPORT refused to accept them back to work after the former refused to submit to the "screening" process. Applying the law (Article 264 of the Labor Code) which makes a distinction, we differentiate between the union members and the union officers among private respondents in granting the reliefs prayed for. Under Article 264 of the Labor Code, a worker merely participating in an illegal strike may not be terminated from his employment. It is only when he commits illegal acts during a strike that he may be declared to have lost his employment status. Since there appears no proof that these union members committed illegal acts during the strike, they cannot be dismissed. The striking union members among private respondents are thus entitled to reinstatement, there being no just cause for their dismissal.

However, considering that a decade has already lapsed from the time the disputed strike occurred, we find that to award separation pay in lieu of reinstatement would be more practical and appropriate. No backwages will be awarded to private respondent-union members as a penalty for their participation in the illegal strike. Their continued participation in said strike, even after most of their co-workers had returned to work, can hardly be rewarded by such an award. The fate of private respondent-union officers is different. Their insistence on unconditional reinstatement or separation pay and backwages is unwarranted and unjustified. For knowingly participating in an illegal strike, the law mandates that a union officer may be terminated from employment.[34] Notwithstanding the fact that INPORT previously accepted other union officers and that the screening required by it was uncalled for, still it cannot be gainsaid that it possessed the right and prerogative to terminate the union officers from service. The law, in using the word may, grants the employer the option of declaring a union officer who participated in an illegal strike as having lost his employment.[35] Moreover, an illegal strike which, more often than not, brings about unnecessary economic disruption and chaos in the workplace should not be countenanced by a relaxation of the sanctions prescribed by law. The union officers are, therefore, not entitled to any relief. However, the above disquisition is now considered moot and academic and cannot be effected in view of a manifestation filed by INPORT dated May 15, 1987.[36] In said Manifestation, it attached a Certification by the President of the Macajalar Labor Union (MLU-FFW) to the effect that the private respondents/ remaining strikers have ceased to be members of said union. The MLU-FFW had an existing collective bargaining agreement with INPORT containing a union security clause. Article 1, Section 2 (b) of the CBA provides:

"The corporation shall discharge, dismiss or terminate any employee who may be a member of the Union but loses his good standing with the Union and or corporation, upon proper notice of such fact made by the latter; provided, however, x x x after they shall have received the regular appointment as a condition for his continued employment with the corporation. x x x"[37] Since private respondents (union members) are no longer members of the MLU, they cannot be reinstated. In lieu of reinstatement, which was a proper remedy before May 1987 when they were dismissed from the union, we award them separation pay. We find that to award one month salary for every year of service until 1985, after April of which year they no longer formed part of INPORT's productive work force partly through

their own fault, is a fair settlement. Finally, there is no merit in INPORT's statement that a Resolution of the NLRC cannot be modified upon reconsideration after the lapse of an unreasonable period of time. Under the present circumstances, a period of eleven months is not an unreasonable length of time. The Resolution of the public respondent dated January 14, 1991 did not acquire finality in view of the timely filing of a motion for reconsideration. Hence, the Commission's modified Resolution issued on December 12, 1991 is valid and in accordance with law. In sum, reinstatement and backwages or, if no longer feasible, separation pay, can only be granted if sufficient bases exist under the law, particularly after a showing of illegal dismissal. However, while the union members may thus be entitled under the law to be reinstated or to receive separation pay, their expulsion from the union in accordance with the collective bargaining agreement renders the same impossible. The NLRC's award of separation pay as "equitable relief" and P1,000.00 as compensation should be deleted, these being incompatible with our findings detailed above. WHEREFORE, from the foregoing premises, the petition in G.R. No. 103560 ("Gold City Integrated Port Service, Inc. v. National Labor Relations Commission, et al.") is GRANTED. One month salary for each year of service until 1985 is awarded to private respondents who were not union officers as separation pay. The petition in G.R. No. 103599 ("Adelo Ebuna, et al. v. National Labor Relations Commission, et al.") is DISMISSED for lack of merit. No costs. SO ORDERED.

J. [ GR Nos. 88710-13, Dec 19, 1990 ] UNION OF FILIPRO EMPLOYEES v. NESTLE PHILIPPINES 270 Phil. 511

MEDIALDEA, J.: This petition assails the decision of the NLRC, dated November 2, 1988 on the consolidated appeals of petitioners, the dispositive portion of which provides as follows: "1.

In NLRC Case No. NCR-12-4007-85 and NLRC Case No. NCR-1-295-86 -

a.

Declaring the strike illegal;

b. Declaring the following respondent union officers, namely: M.L. Sarmiento, B.M. Altarejos, R.D. Paglinawan, C.G. Nuqui, C.Y. Sazon, R. Armas, E. Abel la, A. A. Cañete, A.B. Mira, P.C. Caringal, E. Leonardo, E.C. Nuñez, P.D. San Jose, E. Villena, A. Ricafrente, M. Lantin, A. Montojo, R. Mansud, R. Diaz, R. Urqelles, C. San Jose, E. Bunyi, N. Centeno, R. Gacutan, G. de Borja, N. Nipales, E. San Pedro, C. Ponce, J. Castro, R. Beo, E. Quino, M. Roxas, R. Arandela, W. Ramirez, I. Natividad, S. Pampang, D. Canlobo, R. Calong-Calong, G. Noble, E. Sayao, C. Cenido, P. Mijares, P. Quitlong, A. Avelino, L. Payabyab, I. Rieza, G. Pre, D. Belarmino, to have lost their employment status; c. Ordering the reinstatement of the following respondentsappellants: Juanito Capili, Carlo Medina, Rodrigo Lucas, Adolfo Castillo Jr., Venusito Solis, Ricardo Arevalo, Quezon G. Mateo, Jr., Dionisio Completo, Felix Esquerra, Manuel dela Fuente and Reymundo Almenanza, to their former or equivalent positions without loss of seniority rights but without backwages; d.

Declaring the union (UFE) guilty of unfair labor practice; and

e.

Dismissing the union complaint for unfair labor practice.

2. In RAB-X-2-0047-86, the decision sought to be set aside is AFFIRMED and the individual respondents-appellants namely: Roy Baconguis, Jerome T. Fiel, Efren P. Dinsay, Anastacio G. Caballero, Susan E. Berro, Jose T. Isidto, Wilson C. Barros, Rogelio E. Raiz, Manuel A. Lavin, Cipriano P. Lupeba, are hereby declared to have lost their employment status; 3. In NLRC-00-09-0385-87, the challenged decision is likewise AFFIRMED, except as it affects Cesar S. Cruz, who is ordered reinstated to his former or equivalent position without backwages." (pp. 417-418, Rollo) and the resolution dated March 7, 1989, quoted as follows: "NLRC CASE No. NCR-12-4007-85 entitled Union of Filipro Employees (UFE). Petitioner-Appellants, versus, Filipro, Inc., et al., Respondents-Appellees, NLRC CASE No. NCR-1-295-86 entitled Nestle Phils., Inc., Petitioner-Appellee, versus, Union of FiliproEmployees, et al., Respondents-Appellants, NLRC CASE No. RAB-X-2-004786 entitled Nestle Phils., Inc., Petitioner-Appellee, versus, Cagayan de Oro Filipro Workers Union-WATU, et al., Respondents-Appellants, NCR-00-09-0385-87 entitled Union of Filipro Employees (UFE) and its officers, Complainants-Appellants, versus, Nestle Phils., et al., Respondents-Appellees. The Commission sitting en banc, after deliberation, resolved to rectify par. 3 of the dispositive portion of our November 2, 1988 resolution by ordering the reinstatement of Quezon G. Mateo, Jr. and Dionisio Completo to their former or equivalent position without backwages and to deny the motion for reconsideration filed by appellants UFE and its Officials adversely affected by said resolution." (p. 429, Rollo) In a lengthy and voluminous petition, dwelling largely on facts, petitioner Union of Filipro Employees and 70 union officers and a member (henceforth "UFE") maintain that public respondent NLRC had acted with grave abuse of discretion in

its affirmance of the decisions of the Labor Arbiters a quo, declaring illegal the strikes staged by UFE. Respondent NLRC premised its decision on the following sets of facts: 1.

InNCR 12-4007-85 and NCR 1-295-86:

UFE filed a notice of strike on November 14, 1985 (BLR-NS-11-344-85) with the Bureau of Labor Relations against Filipro (now Nestle Philippines, Inc., ["Nestle"]). On December 4, 1988, UFE filed a complaint for Unfair Labor Practice (ULP) against Nestle and its officials for violation of the Labor Code (Art. 94) on Holiday Pay, nonimplementation of the CBA provisions (Labor Management Corporation scheme). Financial Assistance and other unfair labor practice (p. 381, Rollo). Acting on Nestle's petition seeking assumption of jurisdiction over the labor dispute or its certification to the NLRC for compulsory arbitration, then Minister of Labor and Employment Blas F. Ople assumed .jurisdiction over the dispute and issued the following order on December 11, 1985: "WHEREFORE, this Office hereby assumes jurisdiction over the labor dispute at Filipro, Inc. pursuant to Article 264(g) of the Labor Code of the Philippines, as amended. In line with this assumption a strike, lockout, or any other form of concerted action such as slowdowns, sitdowns, noise barrages during office hours, which tend to disrupt company operations, are strictly enjoined. Let a copy of this Order be published in three (3) conspicuous places inside company premises for strict compliance of all concerned." (p. 381-382, Rollo) On December 20, 1985, UFE filed a petition for certiorari with prayer for issuance of temporary restraining order, with this Court (G.R. No. 73129) assailing the assumption of jurisdiction by the Minister. Notwithstanding the automatic injunction against any concerted activity, and an absence of a restraining order, the union members, at the instigation of its leaders, and in clear defiance of Minister Ople'sOrder of December 11, 1985, staged a strike and continued to man picket lines at the Makati Administrative Office and all of Nestle'sfactories and warehouses at Alabang, Muntinlupa, Cabuyao, Laguna, and Cagayan de Oro City. Likewise, the union officers and members distributed leaflets to employees and passersby advocating a boycott of company products (p. 383, Rollo). On January 23, 1986, Nestle filed a petition to declare the strike illegal (NCR-1-295-86) premised on violation of the CBA provisions on "no strike/no lockout" clause and the grievance machinery provisions on settlement of disputes. On January 30, 1986, then Labor Minister Ople issued another Order, with this disposition: "WHEREFORE, in line with the Order of December 11, 1985, this Office hereby orders all the striking workers to report for work and the company to accept them under the same terms and conditions prevailing before the work stoppage within forty eight (48) hours from notice of this Order.

The Director of Labor Relations is designated to immediately conduct appropriate hearings and meetings and submit his recommendations to enable this Office to decide the issues within thirty (30) days." (p. 383, Rollo) Despite receipt of the second order dated January 30, 1986, and knowledge of a notice caused to be published by Nestle in the Bulletin on February 1, 1986, advising all workers to report to work not later than February 3, 1986, the officers and members of UFE continued with the strike. On February 4, 1986, the Minister B. Ople denied their motion for reconsideration of the return-to-work order portion as follows: "WHEREFORE, the motion for reconsideration is hereby denied and no further motion of similar nature shall be entertained. "The parties are further enjoined from committing acts that will disrupt the peaceful and productive relations between the parties while the dispute is under arbitration as well as acts considered illegal by law for the orderly implementation of this Order like acts of coercion, harassment, blacking of public thoroughfares, ingress and egress to company premises for lawful purposes or those undertaken without regard to the rights of the other party. "Police and military authorities site requested to assist in the proper and effective implementation of this Order." (p. 384, Rollo) UFE defied the Minister and continued with their strike. Nestle filed criminal charges against those involved. On March 13, 1986, the new Minister of Labor and Employment, Augusto B. Sanchez, issued a Resolution, the relevant portions of which stated thus: "This Office hereby enjoins all striking workers to return-to-work immediately and management to accept them under the same terms and conditions prevailing previous to the work stoppage except as qualified in this resolution. the management of Nestle Philippines is further directed to grant a special assistance as suggested by this Ministry in an order dated 30 January 1986 to all striking employees covered by the bargaining units at Makati, Alabang, Cabuyao and Cagayan de Oro, City in an amount equivalent to their weighted average monthly basic salary, plus the cash conversion value of the vacation leave credits for the year 1986, payable not later than five (5) days from the date of the actual return to work by the striking workers." (p. 385, Rollo) On March 17, 1986, the strikers returned to work. On March 31, 1986, we granted UFE's Motion to Withdraw its Petition for Certiorari (G.R. No. 73129) (p. 385, Rollo). On April 23, 1986, Minister Sanchez rendered a Decision, the dispositive portion of which reads: "WHEREFORE, the Union charge for unfair labor practices is hereby dismissed for want of merit. Nestle Philippines is hereby directed to make good its promise to grant an additional benefit in the form of bonus equivalent to one (1) month's gross

compensation to all employees entitled to the same in addition to the one-month weighted average pay granted by this office in the return-to-work Order." (p. 786, Rollo) On June 6, .1986, Minister Sanchez modified the foregoing decision as follows: "WHEREFORE, our 23 April 1986 Decision is hereby modified as fallows: "1. NestIe Philippines is directed to pay the Anniversary bonus equivalent to one month basic salary to all its employees in lieu of the one month gross compensation previously ordered by this office." (p. 787, Rollo) On November 13, 1987, after, trial on the merits, Labor Arbiter Eduardo G. Magno issued his decision, disposing as follows: "WHEREFORE, judgment is hereby, rendered: "1.

Declaring the strike illegal.

"2. Declaring all the respondent union officers, namely: M.L. Sarmiento, R.M. Alterejos, R.D. Paglinawan, C.G. Nuqui, C.Y. Sazon, R. Lucas, R. Armas, E. Abella, A.A. Cañete, J.T. Capili, A.S. Castillo, Jr., P.C. Caringal, E. Leonardo, E.B. Mira, E.C. Nuñez, P.D. San Jose, V. Solis, E. Villena, A. Ricafrente, M. Lantin, A. Mortojo, R. Munsod, R. Diaz, R. Urgelles, C. San Jose, E. Bunyi, N. Centeno, R. Gacutan, G. de Borja, N. Nipales, E. San Pedro, M. de la Fuente, C. Medina, C. Ponce, J. Castro Jr., R. Arevalo, R. Beo, F. Esguerra, R. Almenanza, E. Quino, M. Roxas, R. Arandela, W. Ramirez, I. Natividad, S. Pampang, D. Ganlobo, G. Noble, E. Sayao, C. Cenido, F. Mijares, R. Calong-Calong, P. Quitlong, D. Completo, A. Avelino, L. Payabyab, I. Rieza, D. Belarmino, Q. Mateo, and C. Pre to have lost their employment status. "3.

Declaring the union guilty of unfair labor practice; and

"4.

Dismissing the Union complaint for unfair labor practice." (pp. 380-381, Rollo)

2. InRAB-X-2-00-47-86: Filipro (Nestle) and the Cagayan de Oro Filipro Workers Union - WATU, renewed a 3year contract, made effective, from December 1, 1984 up to June 30, 1987. Petitioners signed the CBA as the duly-elected officers of the Union. On January 19, 1985, the union officers, together with other members of the union sent a letter to Workers Alliance Trade Unions (WATU), advising them "that henceforth we shall administer the CBA by ourselves and with the help of the Union of Filipro Employees (UFE) to where we have allied ourselves." WATU disregarded the union's advice, claiming to be the contracting party of the CBA, UFE -filed a petition (Case No. CRD-M-88-326-85) for administration of the existing CBAs at Cebu, Davao and Cagayan de Oro bargaining units against TUPAS and WATU. From January 22, 1986 to March 14, 1986, the rank and file employees of the company staged a strike at the instigation of the UFE officers, who had, represented themselves as officers.

Nestle filed a petition to declare the strike illegal. The strikers countered that their strike was legal because the same was staged pursuant to the notice of strike filed by UFE On November 14, 1985 (BLR-NS-11-344-85), of which they claim to be members, having disaffiliated themselves from CDO-FWU-WATU. On November 24, 1987, Executive Labor Arbiter Zosimo Vasallo issued his decision, disposing as follows: "WHEREFORE, in view of the foregoing, judgment is hereby rendered: "1.

Declaring the strike illegal;

"2.

Declaring respondent union guilty of unfair labor practice; and

"3. Declaring the following individual respondent Union officers namely: Roy Y. Baconguis, Jerome T. .Fiel, Efren P. Dinsay, Anastacio G. Caballero, Susan E. Berro, Jose T. Isidro, Wilson C. Barros, Rogelio E. Raiz, Manuel A. Lavin and Cipriano P. Lupeba to have lost their employment status." (p. 388, Rollo) 3. InNCR-00-09-`03285-87 (a) On August 13, 1986, UFE, its officers and members staged e walkout from their jobs, and participated in the Welga ng Bayan. Nestle filed a petition to declare the walkout illegal (NLRC Case No. SRB-lV-1831-87), (p. 392, Rollo); (b) On September 21, 1986, complainants (UFE) again did not proceed to their work, but joined the picket line in sympathy with the striking workers of Southern Textile Mills, which became the subject of an Illegal Strike Petition (NLRC Case ,SRB-IV-I-1831-87) (p. 392, Rollo); (c) On November 12, 1986, UFE its officers and members just left their work premises and marched towards Calamba in a demonstration over the slaying of a labor leader, x x x hence a complaint for Illegal Walkout (NLRC Case No. SRB-IV-1833-87) was filed by Nestle (p. 392, Rollo); (d) On December 4, 1986, UFE filed a Notice of Strike with the Bureau of Labor Relations (BLR-NS-12-531-86) (to protest the unfair labor practices of Nestle, such as hiring of contractual workers to perform regular jobs and wage discrimination) (p. 392, Rollo); (e) On December 23, 1986, then Minister Augusto S. Sanchez certified the labor dispute to the Commission for compulsory arbitration, strictly enjoining any intended or actual strike or lockout (p. 392, Rollo) (f) On August 18, 1987, UFE union officers and members at the Cabuyao factory again abandoned their jobs and just walked out, leaving unfinished products on line and raw materials, leading to their spoilage. The walk-out resulted in economic losses to the company. Nestle filed a Petition to Declare the Walkout Illegal. (NLRC Case No. SRBIV-3-1898-87) (p. 407, Rollo); (g) On August 21, 1987, UFE union officers and members at the Alabanq factory also left their jobs in sympathy with the walkout staged by

their Cabuyao counterparts. Nestle filed again a Petition to Declare the Strike Illegal (NLRC-NCR-Case No. 00-08-03003-87) (p. 407, Rollo); (h) On August 27, 1987, UFE union members at the Alabang and Cabuyao factories, in disregard of the Memorandum of Agreement entered into by the Union and Management on August 21, 1987, (to exert their best efforts for the normalization of production targets and standards and to consult each other on any matter that may tend to disrupt production to attain industrial peace) participated in an indignation rally in Cabuyao because of the death of two (2) members of PAMANTIC, and in Alabang because one of their members was allegedly mauled by a policeman during the nationwide strike on August 26, 1987 (p. 408, Rollo); (i) On September 4, 1987, around 6:00 P.M. all sections at the Alabang factory went on a 20-minute meal break simultaneously, contrary to the agreement and despite admonition of supervisors, resulting in complete stoppage of their production lines. Responsible officials namely: Eugenic San Pedro, Carlos Jose, and Cesar Ponce, were suspended from work for six (6) days without pay (p. 408, Rollo). (j) From September 5 to 8,. 1987, at the instigation of UFE union officers, all workers staged a sitdown strike; and (k) On September 7, 1987, Cabuyao's culinary section's union members sympathized with the sitdown strike at Alabang, followed at 12:30 P.M. by the whole personnel of the production line and certain areas in the Engineering Department. These sitdown strikes at the Alabangand Cabuyao factories became the subject of two separate petitions to declare the strike illegal (NCR-Case No. 00-09-03168-87 and SRB-IB-9-1903-87, respectively) (p. 408, Rollo); (1)

On September 8, 1987, Hon. F. Drilon issued the following order:

"All the workers are hereby directed to return to work immediately, refrain from resorting to any further slowdown, sitdown strike, walkout and any other kind of activities that may tend to disrupt the normal operations of the company. The company is directed to accept all employees and to resume normal operations. Parties are likewise directed to cease and desist from committing any and all acts that would aggravate the situation." (p. 394, Rollo) (m) Despite the order, UFE staged a strike on September 11, 1987 without notice of strike, strike vote and in blatant defiance of a then Labor Minister Sanchez's certification order dated November 23, 1986 and Secretary Drilon's return-to-work order dated September 8, 1987." (p. 409, Rollo); (n) Nestle sent, individual letter of termination dated September 14, 1987 dismissing them from the service effective immediately for knowingly instigating and participating in an illegal strike, defying the order of the Secretary of Labor, dated September. 8, 1987, and other illegal acts (pp. 394-395, Rollo) On September 22, 1987, UFE filed a complaint for Illegal Dismissal, ULP and damages (NLRC NCR-"00-03285-87). Labor Arbiter Evangeline Lubaton ruled on both issues of dismissal and strike legality, upon the premise that the issue on validity of the dismissal

of the individual complainants from employment "depends on the, resolution of the issue on whether or not the strike declared by complainants was illegal." The decision dated January 12, 1988, disposed as follows; "WHEREFORE, in view of the foregoing, judgment is hereby rendered: 1.

Dismissing the instant complaint for lack of merit; and

2. Confirming the dismissal of all individual complainants herein as valid and legally justified." (p. 376, Rollo) UFE appealed, assailing the three decisions, except that rendered in Case No. NLRCNCR-12-4007-85 (Complaint for Unfair Labor Practice Against UFE) "because it was already rendered moot and academic by the return to work agreement and order dated March 10 and 13, 1986, respectively." (p. 49, Rollo) Upon UFE's subsequent motion, the three appeals were ordered consolidated and elevated to the NLRC en banc (p. 95, Rollo). The NLRC affirmed the unanimous decisions of the three labor arbiters which declared the strikes illegal, premised on the view that "the core of the controversy rests upon the legality of the strikes." In the petition before Us, UFE assigns several errors (pp. 63-321, Rollo), which We have summarized as follows: 1. that Articles 263 and 264 are no longer good laws, since compulsory arbitration has been curtailed under the present Constitution. 2. that the Question on the legality of the strike was rendered moot and academic when Nestle management accepted, the striking workers in compliance with the returnto-work order of then Minister of Labor Augusto Sanchez dated March 13, 1986, (citing the case of Bisayan Land Transportation Co. v. CIR (102 Phil. 439) and affirmed in the case of Feati University Faculty Club (PAFLU) v. Feati University, G.R. No, L31503, August 15, 1974, 58 SCRA 395). 3. that the union did not violate the no-strike/no lockout clause, considering that the probition applies to economic strikes, pursuant to Philippine Metal Foundries v. CIR, G.R. No. L-34948-49, May 15, 1979, 90 SCRA 135. UFE, it is claimed, premised their strike on a violation of the labor standard laws or non payment of holiday pay, which is, in effect, a violation of the CBA. 4. on the commission of illegal and prohibited acts which automatically rendered the strike illegal, UFE claimed that there were no findings of specific acts and identities of those participating as to render them liable (ESSO Phils, v. Malayang Manggagawa sa ESSO, G.R. No. L-36545, January 26, 1977, 75 SCRA 72; Shell Oil Workers Union v. CIR, G.R. No. L-28607, February 12, 1972, 43 SCRA 224). By holding the officers liable for the illegal-acts of coercion, or denial of free ingress and egress," without specifying and finding out their specific participation therein, the Labor Arbiter resorted to the principle of vicarious liability which has since

been discarded in the case of Benguet Consolidated v. CIR, G.R. No. L-24711, April 30, 1968, 23 SCRA 465. We agree with the Solicitor General that the petition failed to show that the NLRC committed grave abuse of discretion in its affirmance of the decisions of the Labor Arbiters a quo. At the outset, UFE Questions the power of the Secretary of Labor under Art. 263(g) of the Labor Code to assume jurisdiction over a labor dispute tainted with national interests, or to certify the same for compulsory .arbitration. UFE contends that Arts. 263 and 264 are based on the 1973 Constitution, specifically Sec. 9 of Art. II thereof, the pertinent portion of which reads: "Sec. 9. x x x. The State may provide for compulsory arbitration." (p. 801, Rollo) UFF argues that since the aforecited provision of Sec. 9 is no longer found in the 1987 Constitution, Arts. 263 (g) and 264 of the Labor Code are now unconstitutional and must be ignored." We are not persuaded. We agree with the Solicitor General that on the contrary, both provisions are still applicable. We quote: "Article 7 of the New Civil Code declares that: 'Article 7. Laws &re repealed only by subsequent ones, and their violation or nonobservance shall not be excused by disuse or custom or practice to the contrary. x x x.'' "In the case at bar, no law has ever been passed by Congress expressly repealing Articles 263 and 264 of the Labor Code. Neither may the 1987 Constitution be considered to have impliedly repealed the said Articles, considering that there is no showing that said articles are inconsistent with the said Constitution. Moreover, no court has ever declared that the .said articles are inconsistent with, the 1987 Constitution. "On the contrary, the continued validity and operation of Articles 263 and 264 of the Labor Code has been recognized by no less than the Congress of the Philippines when the latter enacted into law R.A. 6715, otherwise known as Herrera Law, Section 27 of which-amended paragraphs (g) and (i) of Articles 263 of the Labor Code. "At any rate, it must be noted that Articles 263 (q) and 264 of the Labor Code have been enacted pursuant to the police power of the State, which has been defined as the power inherent in a Government to enact laws, within constitutional limits, to promote the order, safety, health, morals and general welfare of society (People vs. Vera Reyes, 67 Phil. 190). The police power, together with the power of eminent domain and the power of taxation, is an inherent power of government and does not need to ' be expressly conferred by the Constitution. Thus, it is submitted that the argument of petitioners that Articles 263 (g) and 264 of the Labor Code do not have any constitutional foundation is legally inconsequential." (pp. 801-803, Rollo)

On the issue of the legality of the strike committed, UFE seeks to absolve itself by pointing out qualifying factors such as motives, good faith, absence of findings on specific participation and/or liability, and limiting the no-strike provision to economic strikes. UFE completely misses the underlying principle embodied in Art. 264(g) on the settlement of labor disputes and this is, that assumption and certification orders are executoryin character and are to be strictly complied with by the parties even during the pendency of any petition questioning their validity. This extraordinary authority given to the Secretary of Labor is aimed at arriving at a peaceful and speedy solution to labor disputes, without jeopardizing national interests. Regardless therefore of their motives, or the validity of their claims, the striking workers must cease and/or desist from any and all acts that tend to, or undermine this authority of the Secretary of Labor, once an assumption and/or certification order is issued. They cannot, for instance, ignore return-to-work orders, citing unfair labor practices on the part of the company, to justify their actions. Thus, the NLRC, in its decision, reemphasized the nature of a return-to work order within the context of Art. 264(g) as amended by BP Nos. 130 and 227: "x x x "One other point that must be underscored is that the return-to-work order is issued pending the determination of the legality or illegality of the strike. It is not correct to say that it may be enforced only if the strike is legal and may be disregarded if the strike is illegal, for the purpose precisely is to maintain the status quo while the determination is being made. Otherwise, the workers who contend that their strike is legal can refuse to return to work to their work and cause a standstill on the company operations while retaining the positions they refuse to discharge or allow the management to fill. Worse, they will also claim payment for work not done, on the ground that they are still legally employed although actually engaged in activities inimical to their employer's interest. (Underscoring supplied) "This is like eating one's cake and having it too, and at the expense of the management. Such an unfair situation surely was not contemplated by our labor laws and cannot be justified under the social justice policy, which is a policy of fairness to both labor and management. Neither can this unseemly arrangement be sustained under the due process clause as the order, if thus interpreted, would be plainly oppressive and arbitrary. "x x x" (p. 415, Rollo) Also, in the cases of Sarmiento v. Judge Tuico, G.R. No. 75271-73; Asian Transmission Corporation v. National Labor Relations Commission, G.R. 77567, 27 June 88, 162 SCRA 676). We stated: "The return to work order does not so much confer a right as it imposes a duty; and while as a right, it may be waived, it must be discharged as a duty even against the worker's will. Returning to work in this situation is not a matter of option or voluntariness but of obligation. The worker must return to his job together with his

co-workers so the operations of the company can be resumed and it can continue serving the public and promoting its interest." We also wish to point out that an assumption and/or certification order of the Secretary of Labor automatically results in a return-to-work of all striking workers, whether or not a corresponding order has been issued by the Secretary of Labor. Thus, the striking workers erred when they continued with their strike alleging absence of a return-to-work order. Article 264(g) is clear. Once an assumption/certification order is issued, strikes are enjoined, or if one has already taken place, all strikers shall immediately return to work. A strike that is undertaken despite the issuance by the Secretary of Labor of an assumption or certification order becomes a prohibitedactivity and thus illegal, pursuant to the second paragraph of Art. 264 of the Labor Code as amended (Zamboanga Wood Products, Inc. v. NLRC, G.R. 82088, October 13, 1989; 178 SCRA 482). The Union officers and members, as a result, are deemed to have lost their employment status for having knowingly participated in an illegal act. The NLRC also gave the following reasons: 1. The strike was staged in violation of the existing CBA provisions on "No Strike/No Lockout Clause" stating that a strike, which is in violation of the terms of the collective bargaining agreement, is illegal, especially when such terms provide for conclusive arbitration clause (Liberal Labor Union vs. Phil. Can Co., 91 Phil. 72; Phil. Airlines vs. PAL Employees Association, L-8197, October 31, 1988). The main purpose of such an agreement is to prevent a strike and it must, therefore, be adhered to strictly and respected if their ends are to be achieved (pp. 397-398, Rollo). 2. Instead of exhausting all the steps provided for in the grievance machinery provided for in the collective bargaining agreement to resolve the dispute amicably and harmoniously within the plant level, UFE went on strike (p. 398, Rollo). 3. The prescribed mandatory cooling-off period and then 7-day strike and after submission of the report of strike vote at Nestle'sMakati Offices and Muntinlupa and Cabuyao Plants were not complied with (NLRC-NCR-12-4007-85 & NCR-1-295-86), while no notice of strike was filed by respondents when they staged the strike at Nestle's Cagayan de Oro Plant (RABX-2-0047-86) contrary to the pertinent provision of Articles 263 and 264 of the Labor Code, emphasizing that "the mandatory character of these cooling-off periods has already, been categorically ruled upon by the Supreme Court" (National Federation of Sugar Workers (NFSW) vs. Ovejera, et al., 114 SCRA 354) (p. 402, Rollo). 4. In carrying out the strike, coercion, force, intimidation, violence with physical injuries, sabotage, and the use of unnecessary and obscene, language or epithets were committed by the respondent officials and members of either UFE or WATU. It is wellsettled that a strike conducted in this manner is illegal (United Seamen's Union vs. Davao Shipowners Association, 20 SCRA 1226). In fact, criminal cases were filed with the Makati Fiscal's Office (p. 402, Rollo)

Thus, the NLRC correctly upheld the illegality of the strikes and the corresponding dismissal of the individual complainants because of their "brazen disregard of successive lawful orders of then Labor Ministers Blas F. Ople, Augusto Sanchez and Labor Secretary Franklin Drilon dated December 11, 1985, January 30, 1986 and February 4, 1986, respectively, and the cavalier treatment of the provisions of the Labor Code and the return-to-work orders of the Minister (now Secretary) of Labor and Employment, or Articles 264 and 265 (now renumbered Arts. 263 and 264), providing in part as follows: "ART. 263. Strikes, picketing and lockouts. xxx xxx

xxx

"(g) When in his opinion there exists a labor dispute causing or likely to cause strikes or lockouts adversely affecting the national interest, such as may occur in but not limited to public utilities, companies engaged in the generation or distribution of energy, banks, hospitals, and export-oriented industries including those within export processing zones, the Minister of Labor and Employment shall assume .jurisdiction over the dispute and decide it or certify the same to the Commission for compulsory arbitration. Such assumption or certification shall have the effect of automatically enjoining the intended or impending strike or lockout as specified in the assumption or certification order. If one has already taken place at the time of assumption, or certification, all striking or locked employee shall immediately return to work and the employer shall immediately resume operations and readmit all workers under the same terms and conditions prevailing before the strike or lockout. The Minister may seek the assistance of law enforcement agencies to ensure compliance with this provision as well as with such orders as he may issue to enforce the same. (Underlining supplied) "The foregoing notwithstanding, the President of the Philippines shall not be precluded from determining the industries wherein (sic) his opinion labor disputes may adversely affect the national interest, and from intervening at any time and assuming jurisdiction over any labor dispute adversely affecting the national interest in order to settle or terminate the same. xxx

xxx

xxx

ART. 264. Prohibited activities. (a) No labor organization or employer shall declare a strike or lockout without first having bargained collectively in accordance with Title VII of this Book or without first having filed the notice required in the preceding Article or without the necessary strike or lockout .vote first having been obtained and reported to the Ministry. No strike or lockout shall be declared a strike assumption of jurisdiction by the President or the Minister or alter certification or submission of the dispute, to compulsory or voluntary arbitration or during the pendency at cases involving the same grounds for the strike or lockout." ([pp. 399-401, Rollo]) (Underlining supplied) On the alleged lack of jurisdiction of Labor Arbiter lubaton, NLRC has clarified that the question on the legality of strike was properly resolved by the Labor Arbiter, not only because the question is perfectly within the original and exclusive jurisdiction of the

Labor Arbiter to adjudicate, but also because the issue was not subsumed by the Order o-f Labor Minister Sanchez, dated December 23, 1986, certifying the Notice of Strike dated December 4, 1986 for compulsory arbitration, further clarifying that the issue of whether or not the strike staged on September 11, 1987 by UFE and its officials and members was illegal is a prejudicial question to the issue of whether or not the complainants were illegally dismissed. We shall not belabor the issue any further. ACCORDINGLY, the petition is DISMISSED, and the decision of public respondentNLRC, dated November 2, 1988, and its Resolution, dated March 7, 1989, are both AFFIRMED, in their entirety. No costs. SO ORDERED.

K. [G.R. No. 142824. December 19, 2001]

INTERPHIL LABORATORIES EMPLOYEES UNION-FFW, ENRICO GONZALES and MA. THERESA MONTEJO, petitioners, vs. INTERPHIL LABORATORIES, INC., AND HONORABLE LEONARDO A. QUISUMBING, SECRETARY OF LABOR AND EMPLOYMENT, respondents. DECISION KAPUNAN, J.: Assailed in this petition for review on certiorari are the decision, promulgated on 29 December 1999, and the resolution, promulgated on 05 April 2000, of the Court of Appeals in CA-G.R. SP No. 50978. Culled from the questioned decision, the facts of the case are as follows: Interphil Laboratories Employees Union-FFW is the sole and exclusive bargaining agent of the rank-and-file employees of Interphil Laboratories, Inc., a company engaged in the business of manufacturing and packaging pharmaceutical products. They had a Collective Bargaining Agreement (CBA) effective from 01 August 1990 to 31 July 1993. Prior to the expiration of the CBA or sometime in February 1993, Allesandro G. Salazar,[1] Vice-President-Human Resources Department of respondent company, was approached by Nestor Ocampo, the union president, and Hernando Clemente, a union director. The two union officers inquired about the stand of the company regarding the duration of the CBA which was set to expire in a few months. Salazar told the union officers that the matter could be best discussed during the formal negotiations which would start soon.

In March 1993, Ocampo and Clemente again approached Salazar. They inquired once more about the CBA status and received the same reply from Salazar. In April 1993, Ocampo requested for a meeting to discuss the duration and effectivity of the CBA. Salazar acceded and a meeting was held on 15 April 1993 where the union officers asked whether Salazar would be amenable to make the new CBA effective for two (2) years, starting 01 August 1993. Salazar, however, declared that it would still be premature to discuss the matter and that the company could not make a decision at the moment. The very next day, or on 16 April 1993, all the rank-and-file employees of the company refused to follow their regular two-shift work schedule of from 6:00 a.m. to 6:00 p.m., and from 6:00 p.m. to 6:00 a.m. At 2:00 p.m. and 2:00 a.m., respectively, the employees stopped working and left their workplace without sealing the containers and securing the raw materials they were working on. When Salazar inquired about the reason for their refusal to follow their normal work schedule, the employees told him to "ask the union officers." To minimize the damage the overtime boycott was causing the company, Salazar immediately asked for a meeting with the union officers. In the meeting, Enrico Gonzales, a union director, told Salazar that the employees would only return to their normal work schedule if the company would agree to their demands as to the effectivity and duration of the new CBA. Salazar again told the union officers that the matter could be better discussed during the formal renegotiations of the CBA.Since the union was apparently unsatisfied with the answer of the company, the overtime boycott continued. In addition, the employees started to engage in a work slowdown campaign during the time they were working, thus substantially delaying the production of the company.[2] On 14 May 1993, petitioner union submitted with respondent company its CBA proposal, and the latter filed its counter-proposal. On 03 September 1993, respondent company filed with the National Labor Relations Commission (NLRC) a petition to declare illegal petitioner unions overtime boycott and work slowdown which, according to respondent company, amounted to illegal strike. The case, docketed NLRC-NCR Case No. 00-09-05529-93, was assigned to Labor Arbiter Manuel R. Caday. On 22 October 1993, respondent company filed with the National Conciliation and Mediation Board (NCMB) an urgent request for preventive mediation aimed to help the parties in their CBA negotiations.[3] The parties, however, failed to arrive at an agreement and on 15 November 1993, respondent company filed with Office of the Secretary of Labor and Employment a petition for assumption of jurisdiction. On 24 January 1994, petitioner union filed with the NCMB a Notice of Strike citing unfair labor practice allegedly committed by respondent company. On 12 February 1994, the union staged a strike. On 14 February 1994, Secretary of Labor Nieves Confesor issued an assumption order[4] over the labor dispute. On 02 March 1994, Secretary Confesor issued an order directing respondent company to immediately accept all striking workers, including the fifty-three (53) terminated union officers, shop stewards and union members back to work under the same terms and conditions prevailing prior to the strike, and to pay all the unpaid accrued year end benefits of its employees in 1993.[5] On the other hand,

petitioner union was directed to strictly and immediately comply with the return to work orders issued by (the) Office x x x.[6] The same order pronounced that (a)ll pending cases which are direct offshoots of the instant labor dispute are hereby subsumed herewith.[7] In the interim, the case before Labor Arbiter Caday continued. On 16 March 1994, petitioner union filed an Urgent Manifestation and Motion to Consolidate the Instant Case and to Suspend Proceedings seeking the consolidation of the case with the labor dispute pending before the Secretary of Labor. Despite objection by respondent company, Labor Arbiter Caday held in abeyance the proceedings before him. However, on 06 June 1994, Acting Labor Secretary Jose S. Brillantes, after finding that the issues raised would require a formal hearing and the presentation of evidentiary matters, directed the Labor Arbiters Caday and M. Sol del Rosario to proceed with the hearing of the cases before them and to thereafter submit their report and recommendation to his office. On 05 September 1995, Labor Arbiter Caday submitted his recommendation to the then Secretary of Labor Leonardo A. Quisumbing.[8] Then Secretary Quisumbing approved and adopted the report in his Order, dated 13 August 1997, hence: WHEREFORE, finding the said Report of Labor Arbiter Manuel R. Caday to be supported by substantial evidence, this Office hereby RESOLVES to APPROVE and ADOPT the same as the decision in this case, and judgment is hereby rendered: (1) Declaring the overtime boycott and work slowdown as illegal strike; (2) Declaring the respondent union officers namely: Nestor Ocampo - President Carmelo Santos - Vice-President Marites Montejo - Treasurer/Board Member Rico Gonzales - Auditor Rod Abuan - Director Segundino Flores - Director Hernando Clemente - Director who spearheaded and led the overtime boycott and work slowdown, to have lost their employment status; and (3) Finding the respondents guilty of unfair labor practice for violating the then existing CBA which prohibits the union or any employee during the

existence of the CBA from staging a strike or engaging in slowdown or interruption of work and ordering them to cease and desist from further committing the aforesaid illegal acts. Petitioner union moved for the reconsideration of the order but its motion was denied. The union went to the Court of Appeals via a petition for certiorari. In the now questioned decision promulgated on 29 December 1999, the appellate court dismissed the petition. The unions motion for reconsideration was likewise denied. Hence, the present recourse where petitioner alleged: THE HONORABLE FIFTH DIVISION OF THE COURT OF APPEALS, LIKE THE HONORABLE PUBLIC RESPONDENT IN THE PROCEEDINGS BELOW, COMMITTED GRAVE ABUSE OF DISCRETION, AMOUNTING TO LACK AND/OR EXCESS OF JURISDICTION WHEN IT COMPLETELY DISREGARDED PAROL EVIDENCE RULE IN THE EVALUATION AND APPRECIATION OF EVIDENCE PROFERRED BY THE PARTIES. THE HONORABLE FIFTH DIVISION OF THE COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION, AMOUNTING TO LACK AND/OR EXCESS OF JURISDICTION, WHEN IT DID NOT DECLARE PRIVATE RESPONDENTS ACT OF EXTENDING SUBSTANTIAL SEPARATION PACKAGE TO ALMOST ALL INVOLVED OFFICERS OF PETITIONER UNION, DURING THE PENDENCY OF THE CASE, AS TANTAMOUNT TO CONDONATION, IF INDEED, THERE WAS ANY MISDEED COMMITTED. THE HONORABLE FIFTH DIVISION OF THE COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION, AMOUNTING TO LACK AND/OR EXCESS OF JURISDICTION WHEN IT HELD THAT THE SECRETARY OF LABOR AND EMPLOYMENT HAS JURISDICTION OVER A CASE (A PETITION TO DECLARE STRIKE ILLEGAL) WHICH HAD LONG BEEN FILED AND PENDING BEFORE THE LABOR ARBITER.[9] We sustain the questioned decision. On the matter of the authority and jurisdiction of the Secretary of Labor and Employment to rule on the illegal strike committed by petitioner union, it is undisputed that the petition to declare the strike illegal before Labor Arbiter Caday was filed long before the Secretary of Labor and Employment issued the assumption order on 14 February 1994. However, it cannot be denied that the issues of overtime boycott and work slowdown amounting to illegal strike before Labor Arbiter Caday are intertwined with the labor dispute before the Labor Secretary. In fact, on 16 March 1994, petitioner union even asked Labor Arbiter Caday to suspend the proceedings before him and consolidate the same with the case before the Secretary of Labor. When Acting Labor Secretary Brillantes ordered Labor Arbiter Caday to continue with the hearing of the illegal strike case, the parties acceded and participated in the proceedings, knowing fully well that there was also a directive for Labor Arbiter Caday to thereafter submit his

report and recommendation to the Secretary. As the appellate court pointed out, the subsequent participation of petitioner union in the continuation of the hearing was in effect an affirmation of the jurisdiction of the Secretary of Labor. The appellate court also correctly held that the question of the Secretary of Labor and Employments jurisdiction over labor-related disputes was already settled in International Pharmaceutical, Inc. vs. Hon. Secretary of Labor and Associated Labor Union (ALU)[10] where the Court declared: In the present case, the Secretary was explicitly granted by Article 263(g) of the Labor Code the authority to assume jurisdiction over a labor dispute causing or likely to cause a strike or lockout in an industry indispensable to the national interest, and decide the same accordingly. Necessarily, this authority to assume jurisdiction over the said labor dispute must include and extend to all questions and controversies arising therefrom, including cases over which the labor arbiter has exclusive jurisdiction. Moreover, Article 217 of the Labor Code is not without, but contemplates, exceptions thereto. This is evident from the opening proviso therein reading (e)xcept as otherwise provided under this Code x x x.Plainly, Article 263(g) of the Labor Code was meant to make both the Secretary (or the various regional directors) and the labor arbiters share jurisdiction, subject to certain conditions. Otherwise, the Secretary would not be able to effectively and efficiently dispose of the primary dispute. To hold the contrary may even lead to the absurd and undesirable result wherein the Secretary and the labor arbiter concerned may have diametrically opposed rulings. As we have said, (i)t is fundamental that a statute is to be read in a manner that would breathe life into it, rather than defeat it. In fine, the issuance of the assailed orders is within the province of the Secretary as authorized by Article 263(g) of the Labor Code and Article 217(a) and (5) of the same Code, taken conjointly and rationally construed to subserve the objective of the jurisdiction vested in the Secretary.[11] Anent the alleged misappreciation of the evidence proffered by the parties, it is axiomatic that the factual findings of the Labor Arbiter, when sufficiently supported by the evidence on record, must be accorded due respect by the Supreme Court. [12] Here, the report and recommendation of Labor Arbiter Caday was not only adopted by then Secretary of Labor Quisumbing but it was likewise affirmed by the Court of Appeals. We see no reason to depart from their findings. Petitioner union maintained that the Labor Arbiter and the appellate court disregarded the parol evidence rule[13] when they upheld the allegation of respondent company that the work schedule of its employees was from 6:00 a.m. to 6:00 p.m. and from 6:00 p.m. to 6:00 a.m. According to petitioner union, the provisions of their CBA on working hours clearly stated that the normal working hours were from 7:30 a.m. to 4:30 p.m.[14] Petitioner union underscored that the regular work hours for the company was only eight (8) hours. It further contended that the Labor Arbiter as well as the Court of

Appeal should not have admitted any other evidence contrary to what was stated in the CBA. The reliance on the parol evidence rule is misplaced. In labor cases pending before the Commission or the Labor Arbiter, the rules of evidence prevailing in courts of law or equity are not controlling.[15]Rules of procedure and evidence are not applied in a very rigid and technical sense in labor cases.[16] Hence, the Labor Arbiter is not precluded from accepting and evaluating evidence other than, and even contrary to, what is stated in, the CBA. In any event, the parties stipulated: Section 1. Regular Working Hours - A normal workday shall consist of not more than eight (8) hours. The regular working hours for the Company shall be from 7:30 A.M. to 4:30 P.M. The schedule of shift work shall be maintained; however the company may change the prevailing work time at its discretion, should such change be necessary in the operations of the Company. All employees shall observe such rules as have been laid down by the company for the purpose of effecting control over working hours.[17] It is evident from the foregoing provision that the working hours may be changed, at the discretion of the company, should such change be necessary for its operations, and that the employees shall observe such rules as have been laid down by the company. In the case before us, Labor Arbiter Caday found that respondent company had to adopt a continuous 24-hour work daily schedule by reason of the nature of its business and the demands of its clients. It was established that the employees adhered to the said work schedule since 1988. The employees are deemed to have waived the eight-hour schedule since they followed, without any question or complaint, the two-shift schedule while their CBA was still in force and even prior thereto. The two-shift schedule effectively changed the working hours stipulated in the CBA. As the employees assented by practice to this arrangement, they cannot now be heard to claim that the overtime boycott is justified because they were not obliged to work beyond eight hours. As Labor Arbiter Caday elucidated in his report: Respondents' attempt to deny the existence of such regular overtime schedule is belied by their own awareness of the existence of the regular overtime schedule of 6:00 A.M. to 6:00 P.M. and 6:00 P.M. to 6:00 A.M. of the following day that has been going on since 1988. Proof of this is the case undisputedly filed by the union for and in behalf of its members, wherein it is claimed that the company has not been computing correctly the night premium and overtime pay for work rendered between 2:00 A.M. and 6:00 A.M. of the 6:00 P.M. to 6:00 A.M. shift. (tsn pp. 9-10, testimony of Alessandro G. Salazar during hearing on August 9, 1994). In fact, the union Vice-President Carmelo C. Santos, demanded that the company make a recomputation of the overtime records of the employees from 1987 (Exh. "P"). Even their own witness, union Director Enrico C. Gonzales, testified that when in 1992 he was still a Quality Control Inspector at the Sucat Plant of the company, his schedule was sometime at 6:00 A.M. to 6:00 P.M., sometime at 6:00 A.M. to 2:00 P.M., at 2:00 P.M. to 10:00 P.M. and sometime at 6:00 P.M. to 6:00 A.M., and when on the 6 to 6 shifts, he received the commensurate pay

(t.s.n. pp. 7-9, hearing of January 10, 1994). Likewise, while in the overtime permits, dated March 1, 6, 8, 9 to 12, 1993, which were passed around daily for the employees to sign, his name appeared but without his signatures, he however had rendered overtime during those dates and was paid because unlike in other departments, it has become a habit to them to sign the overtime schedule weekly (t.s.n. pp. 26-31, hearing of January 10, 1994). The awareness of the respondent union, its officers and members about the existence of the regular overtime schedule of 6:00 A.M. to 6:00 P.M. and 6:00 P.M. to 6:00 A.M. of the following day will be further shown in the discussion of the second issue.[18] As to the second issue of whether or not the respondents have engaged in "overtime boycott" and "work slowdown" from April 16, 1993 up to March 7, 1994, both amounting to illegal strike, the evidence presented is equally crystal clear that the "overtime boycott" and "work slowdown" committed by the respondents amounted to illegal strike. As undisputably testified to by Mr. Alessandro G. Salazar, the company's VicePresident-Human Resources Department, sometime in February, 1993, he was approached by the union President NestorOcampo and Union Director Hernando Clemente who asked him as to what was the stand of the company regarding the duration of the CBA between the company and which was set to expire on July 31, 1993. He answered that the matter could be best discussed during the formal renegotiations which anyway was to start soon. This query was followed up sometime in March, 1993, and his answer was the same. In early April, 1993, the union president requested for a meeting to discuss the duration and effectivity of the CBA. Acceding to the request, a meeting was held on April 15, 1993 wherein the union officers asked him if he would agree to make the new CBA effective on August 1, 1993 and the term thereof to be valid for only two (2) years. When he answered that it was still premature to discuss the matter, the very next day, April 16, 1993, all the rank and file employees of the company refused to follow their regular two-shift work schedule of 6:00 A.M. to 6:00 P.M. and 6:00 P.M. to 6:00 A.M., when after the 8-hours work, they abruptly stopped working at 2:00 P.M. and 2:00 A.M., respectively, leaving their place of work without sealing the containers and securing the raw materials they were working on.When he saw the workers leaving before the end of their shift, he asked them why and their reply was "asked (sic) the union officers." Alarmed by the overtime boycott and the damage it was causing the company, he requested for a meeting with the union officers. In the meeting, he asked them why the regular work schedule was not being followed by the employees, and union Director Enrico Gonzales, with the support of the other union officers, told him that if management would agree to a two-year duration for the new CBA and an effectivity date of August 1, 1993, all employees will return to the normal work schedule of two 12-hour shifts. When answered that the management could not decide on the matter at the moment and to have it discussed and agreed upon during the formal renegotiations, the overtime boycott continued and the employees at the same time employed a work slowdown campaign during working hours, causing considerable delay in the production and complaints from the clients/customers (Exh. "O", Affidavit of Alessandro G. Salazar which formed part of his direct testimony). This testimonial narrations of Salazar was, as earlier said, undisputed because the

respondents' counsel waived his cross examination (t.s.n. p. 15, hearing on August 9, 1994). Aside from the foregoing undisputed testimonies of Salazar, the testimonies of other Department Managers pointing to the union officers as the instigators of the overtime boycott and work slowdown, the testimony of Epifanio Salumbides (Exh. "Y") a union member at the time the concerted activities of the respondents took place, is quoted hereunder: 2. Noon Pebrero 1993, ipinatawag ng Presidente ng Unyon na si Nestor Ocampo ang lahat ng taga-maintenance ng bawat departamento upang dumalo sa isang miting. Sa miting na iyon, sinabi ni Rod Abuan, na isang Direktor ng Unyon, na mayroon ilalabas na memo ang Unyon na nag-uutos sa mga empleyado ng Kompanya na mag-imbento ng sari-saring dahilan para lang hindi sila makapagtrabaho ng"overtime". Sinabihan rin ako ni Tessie Montejo na siya namang Treasurer ng Unyon na 'Manny, huwag ka na lang pumasok sa Biyernes para hindi ka masabihan ng magtrabaho ng Sabado at Linggo' na siya namang araw ng "overtime" ko. x x x 3. Nakalipas ang dalawaang buwan at noong unang bahagi ng Abril 1993, miniting kami ng Shop Stewards namin na sina Ariel Abenoja, Dany Tansiongco at Vicky Baron. Sinabihan kami na huwag ng mag-ovetime pag nagbigay ng senyas ang Unyon ng "showtime." 4. Noong umaga ng ika-15 ng Abril 1993, nagsabi na si Danny Tansiongco ng "showtime". Dahil dito wala ng empleyadong nag-overtime at sabay-sabay silang umalis, maliban sa akin. Ako ay pumasok rin noong Abril 17 at 18, 1993 na Sabado at Linggo. 5. Noong ika-19 ng Abril 1993, ako ay ipinatawag ni Ariel Abenoja Shop Steward, sa opisina ng Unyon. Nadatnan ko doon ang halos lahat ng opisyales ng Unyon na sina: Nestor Ocampo ----- Presidente Carmelo Santos ----- Bise-Presidente Nanding Clemente -- Director Tess Montejo------- Chief Steward Segundo Flores ------ Director Enrico Gonzales ----- Auditor Boy Alcantara ------- Shop Steward Rod Abuan ----------- Director

at marami pang iba na hindi ko na maala-ala. Pagpasok ko, ako'y pinaligiran ng mga opisyales ng Unyon. Tinanong ako ni Rod Aguan kung bakit ako "nag-ovetime" gayong "Binigyan ka na namin ng instruction na huwag pumasok, pinilit mo pa ring pumasok." "Management ka ba o Unyonista." Sinagot ko na ako ay Unyonista. Tinanong niya muli kung bakit ako pumasok. Sinabi ko na wala akong maibigay na dahilan para lang hindi pumasok at "mag-overtime." Pagkatapos nito, ako ay pinagmumura ng mga opisyales ng Unyon kaya't ako ay madaliang umalis. x x x" Likewise, the respondents' denial of having a hand in the work slowdown since there was no change in the performance and work efficiency for the year 1993 as compared to the previous year was even rebuffed by their witness M. Theresa Montejo, a Quality Control Analyst. For on cross-examination, she (Montejo) admitted that she could not answer how she was able to prepare the productivity reports from May 1993 to February 1994 because from April 1993 up to April 1994, she was on union leave. As such, the productivity reports she had earlier shown was not prepared by her since she had no personal knowledge of the reports (t.s.n. pp. 32-35, hearing of February 27, 1995). Aside from this admission, the comparison made by the respondents was of no moment, because the higher production for the years previous to 1993 was reached when the employees regularly rendered overtime work. But undeniably, overtime boycott and work slowdown from April 16, 1993 up to March 7, 1994 had resulted not only in financial losses to the company but also damaged its business reputation. Evidently, from all the foregoing, respondents' unjustified unilateral alteration of the 24hour work schedule thru their concerted activities of "overtime boycott" and "work slowdown" from April 16, 1993 up to March 7, 1994, to force the petitioner company to accede to their unreasonable demands, can be classified as a strike on an installment basis, as correctly called by petitioner company. xxx[19] It is thus undisputed that members of the union by their own volition decided not to render overtime services in April 1993.[20] Petitioner union even admitted this in its Memorandum, dated 12 April 1999, filed with the Court of Appeals, as well as in the petition before this Court, which both stated that "(s)sometime in April 1993, members of herein petitioner, on their own volition and in keeping with the regular working hours in the Company x x x decided not to render overtime". [21] Such admission confirmed the allegation of respondent company that petitioner engaged in overtime boycott and work slowdown which, to use the words of Labor Arbiter Caday, was taken as a means to coerce respondent company to yield to its unreasonable demands. More importantly, the overtime boycott or work slowdown by the employees constituted a violation of their CBA, which prohibits the union or employee, during the existence of the CBA, to stage a strike or engage in slowdown or interruption of work.[22] In Ilaw at Buklod ng Manggagawa vs. NLRC,[23] this Court ruled: x x x (T)he concerted activity in question would still be illicit because contrary to the workers explicit contractual commitment that there shall be no strikes, walkouts,

stoppage or slowdown of work, boycotts, secondary boycotts, refusal to handle any merchandise, picketing, sit-down strikes of any kind, sympathetic or general strikes, or any other interference with any of the operations of the COMPANY during the term of xxx (their collective bargaining) agreement. What has just been said makes unnecessary resolution of SMCs argument that the workers concerted refusal to adhere to the work schedule in force for the last several years, is a slowdown, an inherently illegal activity essentially illegal even in the absence of a no-strike clause in a collective bargaining contract, or statute or rule. The Court is in substantial agreement with the petitioners concept of a slowdown as a strike on the installment plan; as a willful reduction in the rate of work by concerted action of workers for the purpose of restricting the output of the employer, in relation to a labor dispute; as an activity by which workers, without a complete stoppage of work, retard production or their performance of duties and functions to compel management to grant their demands. The Court also agrees that such a slowdown is generally condemned as inherently illicit and unjustifiable, because while the employees continue to work and remain at their positions and accept the wages paid to them, they at the same time select what part of their allotted tasks they care to perform of their own volition or refuse openly or secretly, to the employers damage, to do other work; in other words, they work on their own terms. x x x.[24] Finally, the Court cannot agree with the proposition that respondent company, in extending substantial separation package to some officers of petitioner union during the pendency of this case, in effect, condoned the illegal acts they committed. Respondent company correctly postured that at the time these union officers obtained their separation benefits, they were still considered employees of the company. Hence, the company was merely complying with its legal obligations.[25] Respondent company could have withheld these benefits pending the final resolution of this case. Yet, considering perhaps the financial hardships experienced by its employees and the economic situation prevailing, respondent company chose to let its employees avail of their separation benefits. The Court views the gesture of respondent company as an act of generosity for which it should not be punished. WHEREFORE, the petition is DENIED DUE COURSE and the 29 December 1999 decision of the Court of Appeals is AFFIRMED. SO ORDERED.

L. [G.R. No. 113347. June 14, 1996] FILIPINAS SYNTHETIC FIBER CORPORATION (FILSYN), petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION, LABOR ARBITER VOLTAIRE A. BALITAAN, FELIPE LOTERTE and DE LIMA TRADING & GENERAL SERVICES, respondents. SYLLABUS

1. LABOR AND SOCIAL LEGISLATION; LABOR STANDARDS; LABOR-ONLY CONTRACTING; ELEMENTS THEREOF; NOT PRESENT IN CASE AT BAR. We agree that there is sufficient evidence to show that private respondent DE LIMA is an independent job contractor, not a mere labor-only contractor. Under the Labor Code, two (2) elements must exist for a finding of labor-only contracting: (a) 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 (b) the workers recruited and placed by such persons are performing activities directly related to the principal business of such employer. These two (2) elements do not exist in the instant case. As pointed out by petitioner, private respondent DE LIMA is a going concern duly registered with the Securities and Exchange Commission with substantial capitalization of P1,600,000.00, P400,000.00 of which is actually subscribed. Hence, it cannot be considered as engaged in labor-only contracting being a highly capitalized venture. Moreover, while the janitorial services performed by Felipe Loterte pursuant to the agreement between FILSYN and DE LIMA may be considered directly related to the principal business of FILSYN which is the manufacture of polyester fiber, nevertheless, they are not necessary in its operation. On the contrary, they are merely incidental thereto, as opposed to being integral, without which production and company sales will not suffer. Judicial notice has already been taken of the general practice in private as well as in government institutions and industries of hiring janitorial services on an independent contractor basis.Consequently, DE LIMA being an independent job contractor, no direct employer-employee relationship exists between petitioner FILSYN and private respondent Felipe Loterte. 2. ID.; ID.; INDIRECT EMPLOYER JOINT AND SEVERALLY LIABLE WITH THE DIRECT EMPLOYER; CASE AT BAR. With respect to FILSYNs liability, petitioner cannot totally exculpate itself from the fact that respondent DE LIMA is an independent job contractor. We agree with the Solicitor General that notwithstanding the lack of a direct employer-employee relationship between FILSYN and Felipe Loterte, the former is still jointly and severally liable with respondent DE LIMA for Lotertes monetary claims under Art. 109 of the Labor Code. APPEARANCES OF COUNSEL Sycip, Salazar, Hernandez & Gatmaitan for petitioner. Benedicto Palacol for De Lima Trading & General Services. DECISION BELLOSILLO, J.: Filipinas Synthetic Fiber Corporation (FILSYN) assails the decision of the National Labor Relations Commission (NLRC) of 16 September 19931upholding the ruling of the Labor Arbiter that there exists an employer-employee relationship between FILSYN and private respondent Felipe Loterte.2

On 4 April 1991 FILSYN. a domestic corporation engaged in the manufacture of polyester fiber, contracted with De Lima Trading and General Services (DE LIMA) for the performance of specific janitorial services at the former's plant in Brgy. Don Jose, Sta. Rosa, Laguna.3 Pursuant to the agreement Felipe Loterte, among others, was deployed at FILSYN to take care of the plants and maintain general cleanliness around the premises. On 24 February 1992 Loterte sued FILSYN and DE LIMA as alternative defendants4 for illegal dismissal, underpayment of wages, non-payment of legal holiday pay, service incentive leave pay and 13th month pay alleging that he was first assigned to perform janitorial work at FILSYN in 1981 by the La Saga General Services; that the La Saga was changed to DE LIMA on August 1991; that when a movement to demand increased wages and 13th month pay arose among the workers on December 1991 he was accused by a certain Dodie La Flores of having posted in the bulletin board at FILSYN an article attributing to management a secret understanding to block the demand; and, for denying responsibility, his gate pass was unceremoniously cancelled on 6 February 1992 and he was subsequently dismissed.5 The Labor Arbiter ruled in favor of Loterte. He was classified as a regular employee on the ground that he performed tasks usually necessary or desirable in the main business of FILSYN for more than ten (10) years or since 1981 under the ruling in Guarin v. NLRC.6 FILSYN was declared to be the real employer of Loterte and DE LIMA as a mere labor contractor.7 Hence, FILSYN was adjudged liable for Loterte's reinstatement, payment of salary differentials and back wages from 6 February 1992 up to the date of judgment, in addition to his unpaid legal holiday pay, service incentive leave pay and 13th month pay in the total amount of P56,394.90. FILSYN appealed to the NLRC contending that the application of the Guarin ruling was misplaced since the contractor in said case was not able to prove that it had substantial capital, hence the reason for its being declared as a labor-only contractor. In the case of DE LIMA, however, sufficient evidence existed consisting of its Certificate of Registration issued by the Securities & Exchange Commission (SEC) and Articles of Incorporation and By-Laws to prove that it had substantial capitalization, hence, could not be considered as a mere labor contractor. The NLRC debunked the claim of FILSYN and affirmed the Labor Arbiter in finding DE LIMA as a labor-only contractor. When a motion for reconsideration proved futile, FILSYN filed the instant petition. On 23 February 1994 a temporary restraining order to stay the execution of the NLRC decision was issued by the Court upon approval of a bond in the amount of P56,000.00 to be effective during the pendency of this petition. 8 Petitioner contends that the NLRC committed grave abuse of discretion in holding DE LIMA as a labor-only contractor with no substantial capital or investment. Petitioner insists that the evidence9 it presented shows DE LIMA to be a corporation duly registered with the SEC with substantial capitalization of P1,600,000.00, P400,000.00 of which is actually subscribed. Hence, DE LIMA cannot possibly be considered as without substantial capital. But, assuming arguendo that DE LIMA is without substantial capital

or investment, petitioner contends that it cannot still be considered as the real employer of Loterte since his work is not necessary in the principal business of FILSYN which is the manufacture of polyester, and that present jurisprudence holds that the performance of janitorial services, although directly related to the principal business of the alleged employer, is nonetheless unnecessary since non-performance thereof will not cause production and company sales to suffer.10 In his Comment the Solicitor General agrees with petitioner that DE LIMA is not a labor-only contractor. However, while he concedes that no employer-employee relationship exists between FILSYN and Loterte, the Solicitor General opines that the former is still liable solidarily with DE LIMA, its contractor, for the satisfaction of the Labor Arbiter's awards in favor of Loterte as an indirect employer under Art. 106 of the Labor Code.11 In its Consolidated Reply FILSYN contends that Art. 106 of the Labor Code cited by the Solicitor General applies only in cases where there is failure to pay wages, not in cases where the employee was illegally dismissed, as in the case of Loterte. We agree that there is sufficient evidence to show that private respondent DE LIMA is an independent job contractor, not a mere labor-only contractor. Under the Labor Code, two (2) elements must exist for a finding of labor-only contracting: (a) 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 (b) the workers recruited and placed by such persons are performing activities directly related to the principal business of such employer.12 These two (2) elements do not exist in the instant case. As pointed out by petitioner, private respondent DE LIMA is a going concern duly registered with the Securities and Exchange Commission with substantial capitalization of P1,600,000.00, P400,000.00 of which is actually subscribed.13 Hence, it cannot be considered as engaged in labor-only contracting being a highly capitalized venture.14 Moreover, while the janitorial services performed by Felipe Loterte pursuant to the agreement between FILSYN and DE LIMA may be considered directly related to the principal business of FILSYN which is the manufacture of polyester fiber, nevertheless, they are not necessary in its operation.15 On the contrary, they are merely incidental thereto, as opposed to being integral, without which production and company sales will not suffer. 16 Judicial notice has already been taken of the general practice in private as well as in government institutions and industries of hiring janitorial services on an independent contractor basis.17 Consequently, DE LIMA being an independent job contractor, no direct employer- employee relationship exists between petitioner FILSYN and private respondent Felipe Loterte.18 With respect to its liability, however, petitioner cannot totally exculpate itself from the fact that respondent DE LIMA is an independent job contractor. We agree with the Solicitor General that notwithstanding the lack of a direct employer-employee relationship between FILSYN and Felipe Loterte, the former is still jointly and severally liable with respondent DE LIMA for Loterte's monetary claims under Art. 109 of the Labor Code19 which explicitly provides

The provisions of existing laws to the contrary notwithstanding, every employer or indirect employer shall be held responsible with his contractor or subcontractor for any violation of any provision of this Code. For purposes of determining the extent of their civil liability under this Chapter, they shall be considered as direct employers (Italics supplied). However, a reduction of the Labor Arbiter's awards is in order. In his decision of 31 May 1993, the Labor Arbiter in computing the 13th month pay and service incentive leave pay due Loterte erroneously included the period starting June 1989 to the date of his decision. From the admission of Loterte himself,20 he started working for DE LIMA only in August 1991 and that the Agreement between FILSYN and DE LIMA is dated 4 April 1991.21Consequently, the joint and several liability of FILSYN and DE LIMA could not have covered the period before said date. Thus, without prejudice to the right of petitioner to seek reimbursement from DE LIMA for whatever amount it will have to pay Loterte, we determine their joint and several liability on the basis of the computation of the Labor Arbiter, affirmed by the NLRC (which is not disputed by petitioner except only as to the awards for the period prior to August 1991), as follows A. Underpayment: From August 1991 to 5 Feb. 1992 (P113.00 x 314 = P35,482.00) (P35,482.00 12 = P2,956.83) P2,956.83 x 6 mos. & 5 days = P18,233.78 Less: Amount received (P104 x 314 = P32,656.00) (P32,656.00 12 = P2,721.33) P2,721.33 x 6mos. & 5 days = 16,781.54 Total underpayment due = P1,452.24 B. 13th Month Pay: From Aug. to Dec. 1991 (P113.00 x 314 = P35,482.00) (P35,482.00 12 = P2,956.83) (P2,956.83 x 5 mos. = P14,784.15) P14,784.15 12 = P1,232.01 C. Service Incentive Leave Pay: 1991 (P113.00 x 5 days) = P565.00 D. Backwages: From 6 Feb. 1992 to 31 May 1993 (P113.00 x 314 = P35,482.00) (P35,482.00 12= P2,956.83) (P2,956.83 x 15 mos. & 25 days = P46,816.47 1992 13th month pay = 2,956.83 1992 service incentive leave pay = 565.00 Total back wages due = P50,338.30

WHEREFORE, the questioned decision of respondent National Labor Relations Commission affirming that of the Labor Arbiter as well as its resolution denying petitioner's motion for reconsideration is REVERSED and SET ASIDE and a new one entered: 1. Declaring the relationship between petitioner Filipinas Synthetic Fiber Corporation (FILSYN) and private respondent De Lima Trading and General Services (DE LIMA) as one of job contractorship; 2. Ordering private respondent De Lima Trading and General Services (DE LIMA) to reinstate private respondent FELIPE LOTERTE to his former position or its equivalent without loss of seniority rights; and 3. Ordering private respondent De Lima Trading and General Services (DE LIMA) jointly and severally with petitioner Filipinas Synthetic Fiber Corporation (FILSYN) to pay private respondent FELIPE LOTERTE the following amounts: P1,452.24 for salary differentials, P1,232.01 for 13th month pay, P565.00 for service incentive leave pay, and P50,338.30 for backwages, or a total of P53,587.55 due and payable, without prejudice to FILSYN seeking reimbursement from DE LIMA for whatever amount the former may pay or have paid the latter by virtue hereof. SO ORDERED.

M. GR No. 88210, Jan 23, 1991 ] PHILIPPINE AIRLINES v. SECRETARY OF LABOR + 271 Phil. 231

GRIÑO-AQUINO, J.: In issue in this case is the authority of the Secretary of Labor to order the petitioner Philippine Airlines, Inc. to reinstate officers and members of the union who participated in an illegal strike and to desist from taking any disciplinary or retaliatory action against them. The 1986-1989 Collective Bargaining Agreement (CBA) between the Philippine Airlines (PAL) and the Philippine Airlines Employees Association (PALEA) provided for pay increases for various categories of employees in Section 1, Article V entitled "PAY SCALE." Besides the pay increases, the CBA also provided for the formation of a PAL/PALEA Payscale Panel "(f) x x x to undertake the study, review, correction, updating, complete overhaul, reclassification or re-grouping of positions as may be required of the payscale and position classification to evolve updated payscales as soon as possible." (p. 76, Rollo.)

and that "(iii) x x x the Payscale Panel shall exert all reasonable efforts to complete its studies so as to evolve new updated payscale and position classification by January 01, 1988." (p. 76, Rollo.) As agreed by the parties, the PAL/PALEA Payscale Panel was formed in due time and went to work. By July, 1988, the Job Evaluation Committee of the panel had finished the reconciliation and initial evaluation of positions in all departments within PAL. In November, 1988, the PALEA members of the panel proposed the amount of PHP 3,349 as the minimum salary entry level for the lowest job classification (Job Grade 1), while the PAL panel members proposed PHP 2,310 and a PHP 200 across-the-board increase for employees who could not avail of the payscale adjustments. The panel conferences continued but there was no meeting of minds. PALEA would not accept less than the amount it proposed, while the PAL panel members alleged that they had no authority to offer more. PALEA accused PAL of bargaining in bad faith. On December 29, 1988, PALEA filed with he National Conciliation and Mediation Board (NCMB) a notice of strike on account of: (1) bargaining deadlock; and (2) unfair labor practice by bargaining in bad faith. On January 3, 1989, PAL filed with the NCMB a motion to dismiss PALEA's notice of strike for being premature as the issues raised were not strikeable since there still existed a PAL-PALEA CBA which would not yet expire until September 30, 1989 or with nine (9) more months to run. During the conciliation meeting, the following evolved as the real issues: "1. determination of the minimum entry rate "2. wage adjustment due to payscale study retroactive pay as a consequence of the upgraded payscale or goodwill bonus." (p. 38, Rollo.) On January 6, 1989, Attorney Jesus C. Sebastian, NCMB-NCR Executive Conciliator/Mediator, advised PALEA president. George Pulido, that the issues raised in the notice of strike were "appropriate only for preventive mediation," hence, not valid grounds for a lawful strike. However, when subsequently a representative of NCMB supervised the conduct of PALEA'S strike vote, PAL's counsel was baffled for it was inconsistent with the NCMB order treating the strike notice as preventive mediation case No. PM-01-007-89. PAL's counsel sought clarification from NCMB's Sebastian. He assured PAL that the NCMB representatives could not certify the strike vote. "3.

On January 12, 1989, PALEA submitted the strike vote results to the NCMB. The next

day, January 13, 1989, PAL petitioned Secretary of Labor Franklin Drilon to immediately assume jurisdiction over the dispute in order to avert the impending strike. The reasons for PAL's petition were, as stated by the Secretary himself: "The Philippine Airlines, Inc. is a corporation where the government has substantial equity holding. It is engaged in an industry imbued with national interest. It is the flag carrier of the Republic of the Philippines. Being the sole airline that services domestic routes, a prolonged work stoppage will push back the national economic recovery program of the government and consequently result to enormous damage to the economy of the country. Hundreds of thousands of people directly and indirectly dependent on the continued operations of the firm including the huge work force of the company will likewise be prejudiced. The viability of the firm will also be endangered. These considerations have in the past guided this Office in consistently exercising its powers under Article 263(g) of the Labor Code, as amended, in handling labor disputes in the Company. The current situation is no exception to this rule. This Office is of the view that the present work stoppage at Philippine Airlines, Inc. will adversely affect the national interest. Thus, this Office hereby assumes jurisdiction over the instant dispute." (pp. 38-39, Rollo.) Inexplicably, the Secretary failed to act promptly on PAL's petition for his assumption of jurisdiction. Seven (7) days passed with no reaction from Secretary Drilon. On January 20, 1989, PALEA declared a strike paralyzing PAL's entire operations the next day, January 21, 1989, and resulting in serious inconvenience to thousands of passengers who were stranded in 43 airports throughout the country, and the loss of millions of pesos in unearned revenue for PAL. Late in the day, at 7:50 P.M., Secretary Drilon issued an order assuming jurisdiction over the labor dispute which had already exploded into a full-blown strike, ordering the strikers to lift their pickets and return to work, directing management to accept all returning employees, and resolving the issues subject of the strike, by awarding the following monetary benefits to the strikers, while prohibiting the company from taking retaliatory action against them: "x x x to resolve the impasse between the herein parties, this Office finds the following award just and reasonable: "1.

As far as the issue of minimum entry level is concerned, the company is directed to adjust the same to P2,500.00 from its present level effective January 1, 1989.

The company is ordered to grant the amount of P3.3 million per month to cover across-the-board increases of covered regular employees subject to the distribution "2. of the union as embodied in their proposed scheme but in no instance should the lowest adjustment be less than P300.00. In line with this, the scheme proposed by the union and submitted to NCMB on January 20, 1989 is herein adopted. "It is understood, however, that in items 1 and 2 above, the amount which is higher should be granted.

A goodwill bonus in the amount of P3,000.00 to be paid in four equal pay period "3. installments beginning February 15 and up to March 31, 1989 is hereby awarded." (p. 39, Rollo.) Declaring the strike valid, the Secretary stated: "Except for the fact that the Union's notice of strike was treated as a preventive mediation case (at the instance of NCMB), it should be noted that the Union complied with all the requirements for a valid strike. It observed the cooling-off periods required and submitted the necessary strike vote. If ever there is any ground to discipline the Union officers for non-compliance with the law, it would be based on the 'non-filing' of the strike notice, which 'non-filing' was a consequence of the NCMB's efforts to create the appropriate atmosphere to resolve the dispute by treating the notice of strike as a preventive mediation case. Otherwise put, the strike would have been legal in all respects had not the NCMB, in its good faith effort to settle the dispute, treated the notice of strike as a case for preventive mediation. Under these circumstances, and in the interest of industrial peace and the promotion of the concept of preventive mediation, the parties are directed to desist from committing any retaliatory act as a result of the work stoppage. The UNION, however, is hereby warned that in the future this office will not tolerate such conduct and will apply the full force of the law." (pp. 3-4, Rollo.) The petitioner filed a motion for reconsideration. The Secretary denied it in a minute resolution on May 8, 1989 or three months later. In this petition for review, PAL avers that the Secretary of Labor gravely abused his discretion amounting to excess or lack of jurisdiction: 1. in ruling on the legality of the strike; 2. in directing PAL to desist from taking retaliatory action against the officers and members of the Union responsible for the illegal strike; and 3. in failing to seasonably exercise his authority to avert the illegal strike and protect the rights and interests of PAL whose business is affected with public interest. Under Art. 263 of the Labor Code, the Labor Secretary's authority to resolve a labor dispute within 30 days from the date of assumption of jurisdiction, encompasses only the issues in the dispute, not the legality or illegality of any strike that may have been resorted to in the meantime (Binamira vs. Ogan-Occena, 148 SCRA 677, 685 [1987]). Indeed, as found by the Labor Secretary in his Order of January 21, 1989, the only issues involved in the dispute were: 1. determination of the minimum entry rate 2. wage adjustment due to payscale study

3. retroactive pay as a consequence of the upgraded payscale or goodwill bonus. The legality or illegality of the strike was not submitted to the Secretary of Labor for resolution. The jurisdiction to decide the legality of strikes and lock-outs is vested in Labor Arbiters, not in the Secretary of Labor, Art. 217, par. a. subpar. 5 of the Labor Code provides: "Article 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 nonagricultural. "xxx

xxx

xxx

"5. Cases arising from any violation of Article 265 of this code, including questions involving the legality of strikes and lockouts." (Underscoring ours.) In ruling on the legality of the PALEA strike, the Secretary of Labor acted without or in excess of his jurisdiction. There is merit in PAL'S contention that the Labor Secretary erred in declaring the strike valid and in prohibiting PAL from taking retaliatory or disciplinary action against the strikers for the damages suffered by the Airline as a result of the illegal work stoppage. PALEA's strike on January 20, 1989 was illegal for three (3) reasons: 1. It was premature for there was an existing CBA which still had nine (9) months to run, i.e., up to September 30, 1989. The law expressly provides that neither party to a collective bargaining agreement shall terminate nor modify such agreement during its lifetime. While either party can serve a written notice to terminate or modify the agreement at least sixty (60) days prior to its expiration date (known as the "freedom period") it shall nevertheless be the duty of both parties to keep the status quo and to continue in full force and effect the terms and conditions of the existing agreement during the freedom period and/or until a new agreement is reached by them (Art. 253, Labor Code). 2. It violated the no-strike provision of the CBA, to wit:

"The Association agrees that there shall be no strikes, walkouts, stoppage, or slowdown of work, or any other form of interference with any of the operations of the Company during the period between the signing of the Agreement up to September 30, 1989." (Underscoring supplied, p. 118, Rollo.)

3. The NCMB had declared the notice of strike as "appropriate for preventive mediation." The effect of that declaration (which PALEA did not ask to be reconsidered or set aside) was to drop the case from the docket of notice of strikes, as provided in Rule 41 of the NCMB Rules, as if there was no notice of strike. During the pendency of preventive mediation proceedings no strike could be legally declared. The Secretary must have thought so too, that is why he failed to act, for a period of seven (7) days, on PAL'S petition for him to assume jurisdiction over the labor dispute. The strike which the union mounted, while preventive mediation proceedings were ongoing, was aptly described by the petitioner as "an ambush" (p. 21. Rollo). Since the strike was illegal, the company has a right to take disciplinary action against the union officers who participated in it, and against any union members who committed illegal acts during the strike. Art. 264 of the Labor Code provides: "Art. 264. Prohibited activities. - x x x. "xxx

xxx

xxx

"Any worker whose employment has been terminated as a consequence of an unlawful lockout shall be entitled to reinstatement with full back wages. Any union officer who knowingly participates in an illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment status: Provided, That mere participation of a worker in a lawful strike shall not constitute sufficient ground for termination of his employment, even if a replacement had been hired by the employer during such lawful strike." (Emphasis supplied.) The Labor Secretary exceeded his jurisdiction when he restrained PAL from taking disciplinary action against its guilty employees, for, under Art. 263 of the Labor Code, all that the Secretary may enjoin is the holding of the strike, but not the company's right to take action against union officers who participated in the illegal strike and committed illegal acts. The prohibition which the Secretary issued to PAL constitutes an unlawful deprivation of property and denial of due process for it prevents PAL from seeking redress for the huge property losses that it suffered as a result of the union's illegal mass action. The Secretary may have realized that he was partly to blame for PAL's damages because of his failure to act promptly and use his authority to avert the illegal strike under Article 263(g) of the Labor Code. Nevertheless, the Secretary's delay does not excuse the reckless and irresponsible action of the union in declaring the illegal strike. The liability of the union for that is primary and exclusive. WHEREFORE, the petition for certiorari is granted. The orders dated January 21, 1989 and May 8, 1989 of the Secretary of Labor in NCMB NCR Case No. PM-01-007-89 are

set aside and nullified insofar as the said orders declare valid the PALEA strike of January 20-21, 1989 and restrain the petitioner from taking appropriate legal action against PALEA'S officers who led the illegal strike, and any union members who may have committed illegal acts during said strike. The monetary benefits awarded to the union in the said orders are, however, affirmed. Costs against respondent PALEA. SO ORDERED.

N. G.R. No. 76219

May 27, 1991

GTE DIRECTORIES CORPORATION, petitioner, vs. HON. AUGUSTO S. SANCHEZ and GTE DIRECTORIES CORPORATION EMPLOYEES UNION, respondents. Siguion Reyna, Montecillo & Ongsiako for petitioner. Ignacio P. Lacsina for respondent Union. NARVASA, J.: GTE Directories Corporation (hereafter, simply GTE) is a foreign corporation engaged in the Philippines in the business of publishing the PLDT (Philippine Long Distance Telephone Company) telephone directories for Metro Manila and several provinces. The record shows that initially, the practice was for its sales representatives to be given work assignments within specific territories by the so-called "draw method." These sales territories were so plotted or mapped out as to have "an equal number of advertisers as well as . . . revenue. . ." Within these territories, the sales representatives therein assigned were given quotas; i.e., they had to "achieve a certain amount of revenue or advertisements sold, decreased, increased or cancelled within a given period of time." A territory was not fully released to the salesperson for handling at one time, but assigned in increments or partial releases of account. Now, increments were given by the so-called "Grid System," grids (divisions or sections) within each territory usually numbering five (i.e., Grids I to V). Each grid was assigned a fixed closing dated. At such closing date, a salesperson should have achieved a certain amount of the revenue target designated for his grid; otherwise, he loses the forthcoming grid or forfeits the remaining grids not yet received. The Grid System was installed for the following reasons: (1) to give all salespersons an opportunity to contact advertisers within a reasonable period; (2) to assure GTE that it will get its share of advertising budget from clients as early as possible; and (3) to ensure an even flow of work throughout the company. This practice was observed from 1980 until sometime in June, 1984 when GTE realized that competition among media for a share of the advertising revenue had become so keen as to require quick reaction. GTE therefore launched an aggressive campaign to get what it considered to be its rightful share of the advertising budget of its clientele before it could be allocated to other media (newspaper, television, radio, etc.) It adopted a new strategy by which: (1) all its sales representatives were required, as in the past, to achieve specified revenue targets (advertisements sold) within pre-determined periods; (2) in cases of cancelled revenue accounts or advertisements, it required all its salespersons to re-establish contact and renew the same within a fixed period; (3) if the cancelled revenue accounts were not renewed within the assigned period, said accounts were declared, for a set period, OPEN TERRITORY to all sales representatives including the one who reported the cancellation; (4) if not renewed during said open territory period, said cancelled accounts were deemed no longer "open territory," and the same could be referred for handling to contractual salespersons and/or outside agencies. A new "Sales Evaluation and Production Policy" was thereafter drawn up. GTE informed all its sales representatives of the new policy in a Memorandum dated October 12, 1984. The new policy was regarded as an improvement over the previous Sales Production Policy, which solely considered quota attainment and handling in the Sales Report for the purpose of evaluating performance. It appears that the new policy did not sit well with the union. It demanded that it be given 15 days "to raise questions or objections to or to seek reconsideration of the sales and administrative practices issued by the Company on June 14, 1984." This, GTE granted, and by letter dated October 26, 1984, the union submitted its proposals for "revisions, corrections and deletions of some policies incorporated in the Sales Administrative Practices issued on June 14, 1984 including the new policies recently promulgated by Management." GTE next formulated a new set of "Sales Administrative Practices," pursuant to which it issued on July 9, 1985, a memorandum requiring all Premise Sales Representatives (PSRs) to submit individual reports reflecting target revenues as of deadlines, set at August 2, 1985. This was superseded by another memorandum dated July 16, 1985, revising the previous schedules on the basis of "the consensus reached after several discussions with your DSMs, as well as,

most of you," and pointing out that "the amount required on the 1st deadline (P30,000) . . . has been reduced further (to P20,000) having taken into consideration that most of your accounts you have already on hand are with your respective "prep artists"" On August 5, 1985, GTE's Sales Manager sent another Memorandum to "all premise sales personnel." That memorandum observed that most of them had omitted to submit reports regarding "the target of P20,000.00 revenue handled on . . . (the) first Grid deadline of August 2, 1985" notwithstanding that "several consultations/discussions . . . (had) been held with your DSMs, as well as yourselves in different and separate occasions," and "these schedules/targets were drawn up by no less than you, collectively," and notwithstanding that "this has been a practice of several years." It closed with the expressed expectation that the sales reports would be submitted "no later than 2:00 P.M. reflecting P20,000.00 revenue handled, as per memo re: Grid Deadlines dated July 16, 1985." But as before, the sales representatives did not submit the reports. Instead their union, GTE Directories Corporation Employees Union (hereafter, simply the union), sent a letter to the Sales Manager dated August 5, 1985.1 The letter stated that in fact "only one out of nineteen sales representatives met the P20,000 revenue handled on our first grid deadline of August 2;" that the schedule was not "drawn (up) as a result of an agreement of all concerned" since GTE had failed to get "affirmative responses" from "clustered groups of SRs;" that the union could not "Comprehend how cancelling non-cancelling accounts help production;" and that its members would fail "expectations of cancelling . . . non-cancelling accounts" since it "would result to further reduction of our pay which (they) believe is the purpose of your discriminate and whimsical memo." The following day, on August 6, 1985, the union filed in behalf of the sales representatives, a notice of strike grounded on alleged unfair labor practices of GTE consisting of the following: 1. Refusal to bargain on unjust sales policies particularly on the failure to meet the 75% of the average sales production for two consecutive years; 2. Open territory of accounts; 3. Illegal suspension of Brian Pineda, a union officer; and 4. Non-payment of eight days' suspension pay increase. In due course, the Bureau of Labor Relations undertook to conciliate the dispute. On the same day, August 6, 1985, GTE sent still another memorandum to sixteen (16) of its premise sales representatives, this time through its Director for Marketing & Sales, requiring submission of "individual reports reflecting target revenues as of grid deadlines . . . not later than 4:00 P.M. . . ."2 No compliance was made. GTE thereupon suspended its sales representatives "without pay effective August 12, 1985 for five (5) working days" and warned them that their failure to submit the requisite reports by August 19, 1985 would merit "more drastic disciplinary actions." Still, no sales representative complied with the requirement to submit the reports ("list of accounts to be cancelled"). So, by memorandum of the Marketing Director dated August 19, 1985, all the sales representatives concerned were suspended anew "effective August 20, 1985 until you submit the . . . (report)." Finally, GTE gave its sales representatives an ultimatum. By memorandum dated August 23, 1985, individually addressed to its sales representatives, GTE required them, for the last time, to submit the required reports ("list of accounts to be cancelled") within twenty-four (24) hours from receipt of the memorandum; otherwise, they would be terminated "for cause." Again not one sales representatives submitted a report. Instead, on August 29, 1985, the Union President sent an undated letter to GTE (addressed to its Director for Marketing & Sales) acknowledging receipt of the notice of their suspension on August 19, 1985 in view of their "continued refusal to submit the list of accounts to be cancelled," professing surprise at being "served with a contradictory notice, giving us this time 24 hours to submit the required list, without the suspension letter, which we consider as still in force, being first recalled or withdrawn," asking that they be informed which of the two directives should be followed, and reserving their "right to take such action against you personally for your acts of harassment and intimidation which are clearly designed to discourage our legitimate union activities in protesting management's continious (sic) unfair labor practices." Consequently, by separate letters dated August 29, 1985 individually received, GTE terminated the employment of the recalcitrant sales representatives, numbering fourteen, with the undertaking to give them "separation pay, upon proper clearance and submission of company documents, material etc., in . . . (their) possession." Among those dismissed were the union's president and third vice president, and several members of its board of directors. On September 2, 1985, the union declared a strike in which about 60 employees participated. During all this time, conciliation efforts were being exerted by the Bureau of Labor Relations, including attempts to prevent the imposition of sanctions by GTE on its employees, and the strike itself. When these proved futile, Acting Labor Minister Vicente Leogardo, Jr. issued an Order dated December 6, 1985 assuming jurisdiction over the dispute. The order made the following disposition, to wit: WHEREFORE, this Office hereby assumes jurisdiction over the labor dispute at G.T.E. Directories, pursuant to Article 264 (g) of the Labor Code of the Philippines, as amended. Accordingly, all striking workers including those who were dismissed during the conciliation proceedings, except those who have already resigned, are hereby directed to return to work and the management of G.T.E. Directories to accept all returning employees under the same terms and conditions prevailing previous to the strike notice and without prejudice to the determination of the obligation and rights of the parties or to the final outcome of this dispute. The Bureau of Labor Relations is hereby directed to hear the dispute and submit its recommendations within 15 days upon submission of the case for resolution. All concerned including the military and police authorities are hereby requested to assist in the implementation of this Order." The Acting Secretary opined that the dispute "adversely affects the national interest," because: 1) GTE, a "100% foreign owned" company, had, as publisher of "PLDT's Metro Manila and provincial directories . . . earned a total of P127,038,463 contributing close to P10 million in income tax alone to the Philippine government," and that "major contribution to the national economy . . . (was) being threatened because of the strike;" and 2) "top officers of the union were dismissed during the conciliation process thereby compounding the dispute,"

Reconsideration of this Order was sought by GTE by motion filed on December 16, 1985, on the ground that— 1) "the basis for assumption of jurisdiction is belied by the facts and records of the case and hence, unwarranted;" 2) "national interest is not adversely affected to warrant assumption of jurisdiction by (the) Office of the Minister of Labor and Employment;" and 3) "assumption of jurisdiction by the . . . Minister . . . without prior consultation with the parties violates the company's right to due process of law." GTE however reiterated its previously declared "position that with or without the order now being questioned, it will accept all striking employees back to work except the fourteen (14) premise sales representatives who were dismissed for cause prior to the strike." By Resolution of then Labor Minister Blas Ople dated January 20, 1986, GTE's motion for reconsideration was denied. The order noted inter alia that GTE had "accepted back to work all the returning workers except fourteen (14) whom it previously dismissed insisting that they were legally dismissed for violation of company rules and, therefore, are not included and may not be reinstated on the basis of a return-to-work order," and that "they were dismissed for their alleged failure to comply with the reportorial requirement under the Sales and Administrative Practices in effect since 1981 but which for the present is the subject of negotiations between the parties." The Order then — 1) adverted to the "general rule (that) promulgations of company policies and regulations are basic management prerogatives although the principle of collective bargaining encompasses almost all relations between the employer and its employees which are best threshed out through negotiations, . . . (and that) it is recognized that company policies and regulations are, unless shown to be grossly oppressive or contrary to law, generally binding and valid on the parties until finally revised or amended unilaterally or preferably through negotiations or by competent authorities;" 2) affirmed the "recognized principle of law that company policies and regulations are, unless shown to be grossly oppressive or contrary to law, generally binding (and) valid on the parties and must be complied with until finally revised or amended unilaterally or preferably through negotiations or by competent authorities;" and 3) closed by pointing out that "as a basic principle, the matter of the acceptability of company policies and rules is a proper subject of collective negotiations between the parties or arbitration if necessary." In a clarificatory Order dated January 21, 1986, Minister Ople reiterated the proposition that "promulgations of company policies and regulations are basic management prerogatives," and that "unless shown to be grossly oppressive or contrary to law," they are "generally binding and valid on the parties and must be complied with until finally revised or amended unilaterally or preferably, through negotiations or by competent authorities." Adjudication of the dispute on the merits was made on March 31, 1986 by Order of Minister Ople's successor, Augusto Sanchez. The Order — 1) pointed out "that the issue central to the labor dispute revolves around compliance with existing company policies, rules and regulations specifically the sales evaluation and production policy which was amended by the October 12, 1984 memorandum and the grid schedule;" 2) declared that because fourteen (14) sales representatives — who after reinstatement pursuant to the order of January 20, 1986 had been placed "on forced leave with pay —"were actually dismissed for failure to comply with the reporting requirements under the "Sales Administration Practices" which was (sic) then the subject of negotiations between the parties at the Bureau of Labor Relations," it was only fair that they 'be reinstated . . .with back wages since they were terminated from employment based on a policy . . . still being negotiated to avoid precisely a labor-management dispute from arising" therefrom;" 3) pronounced the union's action relative to the allegedly illegal dismissal of one Brian Pineda to be "barred by extinctive prescription" in accordance with the CBA then in force; and 4) on the foregoing premises adjudicated the dispute as follows: 1. The union and management of G.T.E. Directories Corporation are directed to negotiate and effect a voluntary settlement on the questioned Grid schedule, the Sales Evaluation and Production Policy; 2. Management is ordered to reinstate the fourteen (14) employees with full back wages from the time they were dismissed up to the time that they were on forced leave with pay." Both the Union and GTE moved for reconsideration of the Order. The Union contended that: 1) GTE should have been adjudged guilty of unfair labor practice and other unlawful acts; 2) its strike should have been declared lawful; 3) GTE's so-called "bottom-third" policy, as well as all sales and administrative practices related thereto, should have been held illegal; and 4) GTE should have been commanded: (a) to pay all striking employees their usual salaries, allowances, commission and other emoluments corresponding to the period of their strike; (b) to release to its employees the 8-days pay increase unlawfully withheld from them; (c) to lift the suspension imposed on Brian Pineda and

restore to him the pay withheld corresponding to the suspension period; (d) to pay the sales representatives all their lost income corresponding to the period of their suspensions, and dismissal, including commissions that they might have earned corresponding to their one-week forced leave. GTE for its part, argued that the termination of the employment of its fourteen (14) premise sales representatives prior to the strike should have been upheld. It also filed an opposition to the union's motion for reconsideration. The motions were resolved in a "Decision" handed down by Minister Sanchez on June 6, 1986. The Minister stated that he saw no need to change his rulings as regards Pineda's suspension, the question on GTE's sales and administrative policies, and the matter of back wages. However, as regards "the other issues raised by the union," the Minister agreed "with the company that these were not adequately threshed out in the earlier proceedings . . . (for) (w)hile it is true that the union had already presented evidence to support its contention, the company should be given the opportunity to present its own evidence." Accordingly, he directed the Bureau of Labor Relations to hear said "other issues raised by the union and to submit its findings and recommendations thereon within 20 days from submission of the case for decision." Again GTE moved for reconsideration; again it was rebuffed. The Labor Minister denied its motion by Order dated October 1, 1986. In that order, the Minister, among other things— 1) invoked Section 6, Rule XIII of the Rules and Regulations Implementing the Labor Code, pertinently reading as follows: During the proceedings, the parties shall not do any act which may disrupt or impede the early settlement of the dispute. They are obliged, as part of their duty to bargain collectively in good faith, to participate fully and promptly in the conciliation proceedings called by the Bureau or the Regional Office. and pointed out that "in dismissing 14 salesmen . . . for alleged violations of the reportorial requirements of its sales policies which was then the subject of conciliation proceedings between them, (GTE) acted evidently in bad faith; hence the status quo prior to their dismissal must be restored . . . (and) their reinstatement with backwages is in order up to the time they were on forced leave. . . ;" 2) declared that because he had "ordered the parties to negotiate and effect a voluntary settlement of the questioned Grid Schedule, the Sales Evaluation and Productions Policy, it would be unripe and premature for us to rule on the legality or illegality on the company's sales policies at this instance;" 3) opted, however, to himself resolve "the so-called 'other issues"' which he had earlier directed the Bureau of Labor Relations to first hear and resolve (in the Decision of June 6, 1986, supra), i.e., GTE's liability for unfair labor practice, the legality of the strike and the strikers' right to be paid their wages while on strike, his ruling thereon being as follows: While the company, in merely implementing its challenged sales policies did not ipso facto commit an unfair labor practice, it did so when it in mala fide dismissed the fourteen salesmen, all union members, while conciliation proceedings were being conducted on disputes on its very same policies, especially at that time when a strike notice was filed on the complaint of the union alleging that said sales policies are being used to bust the union; thus precipitating a lawful strike on the part of the latter. A strike is legal if it was provoked by the employer's failure to abide by the terms and conditions of its collective bargaining agreement with the union, by the discrimination employed by it with regard to the hire and tenure of employment, and the dismissal of employees due to union activities as well as the company's refusal to bargain collectively in good faith (Cromwell Commercial Co., Inc. vs. Cromwell Employees and Laborers Union, 19 SCRA 398). The same rule applies if employer was guilty of bad faith delay in reinstating them to their position (RCPI vs. Phil. Communications Electronics & Electricity Workers Federation, 58 SCRA 762). While as a rule strikers are not entitled to backpay for the strike period (J.P. Heilbronn Co. vs. NLU, 92 Phil. 575) strikers may be properly awarded backwages where the strike was precipitated by union busting activities of the employer (Davao Free Workers, Front, et al. vs, CIR, 60 SCRA 408), as in the case at bar. . . . The Minister accordingly annulled and set aside his order for the Bureau of Labor Relations to conduct hearings on said issues since he had already resolved them, and affirmed his Order of March 31, 1986—"directing Union and Management to negotiate a voluntary settlement on the company sales policies and reinstating the fourteen employees with full backwages from the time they were dismissed up to the time they were on forced leave with pay" — "but with the modification that management . . . (was) directed to give the striking workers strike duration pay for the whole period of the strike less earnings." GTE thereupon instituted the special civil action of certiorari at bar praying for invalidation, because rendered with grave abuse of discretion, of the Labor Minister's orders— 1) commanding "reinstatement of the fourteen dismissed employees, and 2) "finding . . . (it) guilty of unfair labor practice and directing (it) to pay strike duration pay to striking workers." It seems to the Court that upon the undisputed facts on record, GTE had cause to dismiss the fourteen (14) premise sales representatives who had repeatedly and deliberately, not to say defiantly, refused to comply with its directive for submission of individual reports on specified matters. The record shows that GTE addressed no less than (six) written official communications to said premise sales representatives embodying this requirement, to wit: 1) Memorandum of July 9, 1985 pursuant to GTE's "Sales Administrative Practices" — superseded by a memorandum dated July 16, 198 — requiring submission of individual reports by August 2, 1985; 2) Memorandum of August 5, 1985, requiring submission of the reports by 2:00 P.M.; 3) Memorandum of August 6, 1985, for submission of requisite reports not later than 4:00 P.M. of that day, with a warning of "appropriate disciplinary action;" 4) Letter of August 9, 1985 imposing suspension without pay for five (5) working days and extending the period for submission of reports to August 19, 1985;

5) Letter of August 19, 1985 suspending the sales representatives until their submission of the required reports; 6) Letter dated August 28, 1985 giving the sales representatives "a last chance to comply with . . . (the) directive within 24 hours from receipt . . .;" with warning that failure to comply would result in termination of employment. The only response of the sales representatives to these formal directives were: 1) a letter by their Union to GTE's Sales Manager dated August 5, 1985 in which the requirement was criticized as not being the "result of an agreement of all concerned," and as incomprehensible, "discriminate and whimsical;" 2) a strike notice filed with the Ministry of Labor on August 6, 1985; and 3) an undated letter sent to GTE's Director for Marketing & Sales on August 29, 1985, drawing attention to what it deemed contradictory directives, and reserving the right to take action against the manager for "acts of harassment and intimidation . . . clearly designed to discourage our legitimate union activities in protesting management's continuous unfair labor practices." The basic question then is whether or not the effectivity of an employer's regulations and policies is dependent upon the acceptance and consent of the employees thereby sought to be bound; or otherwise stated, whether or not the union's objections to, or request for reconsideration of those regulations or policies automatically suspend enforcement thereof and excuse the employees' refusal to comply with the same. This Court has already had occasion to rule upon a similar issue. The issue was raised in a 1989 case, G.R. No. 53515, San Miguel Brewery Sales Force Union (PTGWO) v. Ople.3 In that case, the facts were briefly as follows: In September 1979, the company introduced a marketing scheme known as the "Complementary distribution system" (CDS) whereby its beer products were offered for sale directly to wholesalers through San Miguel's sales offices. The labor union (herein petitioner) filed a complaint for unfair labor practice in the Ministry of Labor, with a notice of strike on the ground that the CDS was contrary to the existing marketing scheme whereby the Route Salesmen were assigned specific territories within which to sell their stocks of beer, and wholesalers had to buy beer products from them, not from the company. It was alleged that the new marketing scheme violates . . . (a provision) of the collective bargaining agreement because the introduction of the CDS would reduce the take-home pay of the salesmen and their truck helpers for the company would be unfairly competing with them." The Labor Minister found nothing to suggest that the employer's unilateral action of inaugurating a new sales scheme "was designed to discourage union organization or diminish its influence;" that on the contrary, it was "part of its overall plan to improve efficiency and economy and at the same time gain profit to the highest;" that the union's "conjecture that the new plan will sow dissatisfaction from its rank is already a prejudgment of the plan's viability and effectiveness, . . . like saying that the plan will not work out to the workers' (benefit) and therefore management must adopt a new system of marketing." The Minister accordingly dismissed the strike notice, although he ordered a slight revision of the CDS which the employer evidently found acceptable. This Court approved of the Minister's findings, and declared correct his holding that the CDS was "a valid exercise of management prerogatives,"4 viz.: Except as limited by special laws, an employer is free to regulate, according to his own discretion and judgment, all aspects of employment, including hiring, work assignments, working methods, time, place and manner of work, tools to be used, processes to be followed, supervision of workers, working regulations, transfer of employees, work supervision, lay-off of workers and the discipline, dismissal and recall of work. . . . (NLU vs. Insular La Yebana Co., 2 SCRA 924; Republic Savings Bank vs. CIR, 21 SCRA 226, 235.) (Perfecto V. Hernandez, Labor Relations Law, 1985 ed., p. 44.) (Emphasis ours.) The Court then closed its decision with the following pronouncements:5 Every business enterprise endeavors to increase its profits. In the process, it may adopt or devise means designed towards that goal. In Abbott Laboratories vs. NLRC, 154 SCRA 713, We ruled: . . . Even as the law is solicitous of the welfare of the employees, it must also protect the right of an employer to exercise what are clearly management prerogatives. The free will of management to conduct its own business affairs to achieve its purpose cannot be denied. So long as a company's management prerogatives are exercised in good faith for the advancement of the employer's interest and not for the purpose of defeating or circumventing the rights of the employees under special laws or under valid agreements, this Court will uphold them (LVN, Pictures Workers vs. LVN, 35 SCRA 147; Phil. American Embroideries vs. Embroidery and Garments Workers, 26 SCRA 634; Phil. Refining Co. vs. Garcia, 18 SCRA 110). . . . In the case at bar, it must thus be conceded that its adoption of a new "Sales Evaluation and Production Policy" was within its management prerogative to regulate, according to its own discretion and judgment, all aspects of employment, including the manner, procedure and processes by which particular work activities should be done. There were, to be sure, objections presented by the union, i.e., that the schedule had not been "drawn (up) as a result of an agreement of all concerned," that the new policy was incomprehensible, discriminatory and whimsical, and "would result to further reduction" of the sales representatives' compensation. There was, too, the union's accusation that GTE had committed unfair labor practices, such as— 1. Refusal to bargain on unjust sales policies particularly on the failure to meet the 75% of the average sales production for two consecutive years; 2. Open territory of accounts;

3. Illegal suspension of Brian Pineda, a union officer; and 4. Non-payment of eight days' suspension pay increase. This Court fails to see, however, how these objections and accusations justify the deliberate and obdurate refusal of the sales representatives to obey the management's simple requirement for submission by all Premise Sales Representatives (PSRs) of individual reports or memoranda requiring reflecting target revenues—which is all that GTE basically required — and which it addressed to the employees concerned no less than six (6) times. The Court fails to see how the existence of objections made by the union justify the studied disregard, or wilful disobedience by the sales representatives of direct orders of their superior officers to submit reports. Surely, compliance with their superiors' directives could not have foreclosed their demands for the revocation or revision of the new sales policies or rules; there was nothing to prevent them from submitting the requisite reports with the reservation to seek such revocation or revision. To sanction disregard or disobedience by employees of a rule or order laid down by management, on the pleaded theory that the rule or order is unreasonable, illegal, or otherwise irregular for one reason or another, would be disastrous to the discipline and order that it is in the interest of both the employer and his employees to preserve and maintain in the working establishment and without which no meaningful operation and progress is possible. Deliberate disregard or disobedience of rules, defiance of management authority cannot be countenanced. This is not to say that the employees have no remedy against rules or orders they regard as unjust or illegal. They may object thereto, ask to negotiate thereon, bring proceedings for redress against the employer before the Ministry of Labor. But until and Unless the rules or orders are declared to be illegal or improper by competent authority, the employees ignore or disobey them at their peril. It is impermissible to reverse the process: suspend enforcement of the orders or rules until their legality or propriety shall have been subject of negotiation, conciliation, or arbitration. These propositions were in fact adverted to in relation to the dispute in question by then Minister Blas Ople in his Order dated January 21, 1986, to the effect among others, that "promulgations of company policies and regulations are basic management prerogatives" and that it is a "recognized principle of law that company policies and regulations are, unless shown to be grossly oppressive or contrary to law, generally binding (and) valid on the parties and must be complied with until finally revised or amended unilaterally or preferably through negotiations or by competent authorities." Minister Sanchez however found GTE to have "acted evidently in bad faith" in firing its 14 salespersons "for alleged violations of the reportorial requirements of its sales policies which was then the subject of conciliation proceedings between them;"6 and that "(w)hile the company, in merely implementing its challenged sales policies did not ipso facto commit an unfair labor practice, it did so when it in mala fide dismissed the fourteen salesmen, all union members, while conciliation proceedings were being conducted on disputes on its very same policies, especially at that time when a strike notice was filed on the complaint of the union alleging that said sales policies are being used to bust the union; thus precipitating a lawful strike on the part of the latter." No other facts appear on record relevant to the issue of GTE's dismissal of the 14 sales representatives. There is no proof on record to demonstrate any underhanded motive on the part of GTE in formulating and imposing the sales policies in question, or requiring the submission of reports in line therewith. What, in fine, appears to be the Minister's thesis is that an employer has the prerogative to lay down basic policies and rules applicable to its employees, but may not exact compliance therewith, much less impose sanctions on employees shown to have violated them, the moment the propriety or feasibility of those policies and rules, or their motivation, is challenged by the employees and the latter file a strike notice with the Labor Department — which is the situation in the case at bar. When the strike notice was filed by the union, the chain of events which culminated in the termination of the 14 sales persons' employment was already taking place, the series of defiant refusals by said sales representatives to comply with GTE's requirement to submit individual reports was already in progress. At that time, no less than three (3) of the ultimate six (6) direct orders of the employer for the submission of the reports had already been disobeyed. The filing of the strike notice, and the commencement of conciliation activities by the Bureau of Labor Relations did not operate to make GTE's orders illegal or unenforceable so as to excuse continued non-compliance therewith. It does not follow that just because the employees or their union are unable to realize or appreciate the desirability of their employers' policies or rules, the latter were laid down to oppress the former and subvert legitimate union activities. Indeed, the overt, direct, deliberate and continued defiance and disregard by the employees of the authority of their employer left the latter with no alternative except to impose sanctions. The sanction of suspension having proved futile, termination of employment was the only option left to the employer. To repeat, it would be dangerous doctrine indeed to allow employees to refuse to comply with rules and regulations, policies and procedures laid down by their employer by the simple expedient of formally challenging their reasonableness or the motives which inspired them, or filing a strike notice with the Department of Labor and Employment, or, what amounts to the same thing, to give the employees the power to suspend compliance with company rules or policies by requesting that they be first subject of collective bargaining, It would be well nigh impossible under these circumstances for any employer to maintain discipline in its establishment. This is, of course, intolerable. For common sense teaches, as Mr. Justice Gregorio Perfecto once had occasion to stress7 that: Success of industries and public services is the foundation upon which just wages may be paid. There cannot be success without efficiency. There cannot be efficiency without discipline. Consequently, when employees and laborers violate the rules of discipline they jeopardize not only the interest of the employer but also their own. In violating the rules of discipline they aim at killing the hen that lays the golden eggs. Laborers who trample down the rules set for an efficient service are, in effect, parties to a conspiracy, not only against capital but also against labor. The high interest of society and of the individuals demand that we should require everybody to do his duty. That demand is addressed not only to employer but also to employees. Minister Sanchez decided the dispute in the exercise of the jurisdiction assumed by his predecessor in accordance with Article 263 (g) of the Labor Code,8 providing in part as follows: (g) When in his opinion there exists a labor dispute causing or likely to cause strikes or lockouts adversely affecting the national interest, such as may occur in but not limited to public utilities, companies engaged in the generation or distribution of energy, banks, hospitals, and export-oriented industries, including those within export processing zones, the Minister of Labor and Employment shall assume jurisdiction over the dispute and decide it or certify the same to the Commission for compulsory arbitration. . . . Even that assumption of jurisdiction is open to question. The production and publication of telephone directories, which is the principal activity of GTE, can scarcely be described as an industry affecting the national interest. GTE is a publishing firm chiefly dependent on the marketing and sale of advertising space for its not inconsiderable revenues. Its services, while of value, cannot be deemed to be in the same category of such essential activities as "the generation or distribution of energy" or those undertaken by "banks, hospitals, and export-oriented industries." It cannot be regarded as playing as vital a role in communication as other mass media. The small number of employees involved in the dispute, the employer's payment of "P10 million in income tax alone to the Philippine government," and the fact that the "top officers of the union were dismissed during the conciliation process," obviously do not suffice to make the dispute in the case at bar one "adversely affecting the national interest."

WHEREFORE, the petition is GRANTED, and as prayed for, the Order dated October 1, 1986 of the public respondent is NULLIFIED and SET ASIDE. SO ORDERED.

O. [G.R. Nos. L-24267-8. May 31, 1966.] PERFECTO FERRER, OSCAR FLORES, JULIAN AGUSTIN, FELICISIMO LICHUGA, PIO SUMAGIT and INHELDER LABORATORIES, INC. & SISTER COMPANIES EMPLOYEES UNION, Petitioners, v. COURT OF INDUSTRIAL RELATIONS, INHELDER LABORATORIES INC., SAN ROQUE TRADING CORPORATION AND/OR HANS INHELDER, PRESIDENT AND GENERAL MANAGER, Respondents. J. C. Espinas & Associates, for Petitioners. Alberto Q, Ubay and Associates and Jose C. Vitug for Respondents.

SYLLABUS

1. EMPLOYER AND EMPLOYEE; STRIKE CALLED TO OFF-SET UNFAIR LABOR PRACTICES BEFORE EXPIRATION OF 30-DAY PERIOD; CASE AT BAR. — Petitioners filed a 30-day notice of strike upon the ground that respondents had been "bargaining in bad faith." The management, in turn, filed unfair labor practice charges against the Union, for alleged refusal to bargain. Meanwhile, the Management suspended, transferred and/or demoted union members. Before the expiration of the 30-day period, petitioner declared a strike. Held: Although the Management may have had the strict legal right to take disciplinary and other administrative measures against the union members, however, the time chosen by the Management therefor justified the belief of the Union that the real or main purpose of the Management was to discourage membership in the Union and to discredit the officers thereof. The strike having been called to off-set what petitioners were warranted in believing in good faith to be unfair labor practices on the part of the management, the petitioners were not bound to wait for the expiration of thirty (30) days from notice of strike before staging the same. The strike was not, accordingly, illegal and the strikes had not thereby lost their status as employees of respondents. Considering, however, that the latter have been absolved from the charge of unfair labor practice, the reinstatement of the strikers must be without backpay.

DECISION

CONCEPCION, J.:

These are two (2) unfair labor practice cases commenced in the Court of Industrial Relations. One (L-24268) was filed by the Management of Inhelder Laboratories, Inc. and its sister companies (Inhelder Inc. and San Roque Trading Corporation) against the Labor Union of employees thereof and some officers and members of the Union, and the other (L-24267) by the latter against the former. Being interrelated, the two cases were jointly heard. In due course, the trial Judge, Hon. Ansberto P. Paredes, rendered a decision dismissing the complaints in both cases. On motion for reconsideration filed by the Management, the Court of Industrial Relations en banc, in a resolution penned by Judge Emiliano C. Tabigne, and concurred "in the result" by Presiding Judge Arsenio I. Martinez and Associate Judge Amando C. Bugayong, and with, in effect, the dissent of Judge Paredes, reconsidered the latter’s decision , insofar as it dismissed the complaint of the Management, and decreed that the officers and members of the Union who had participated in a peaceful strike staged by the latter from July 1 to July 15, 1963, "be considered to have lost their status as employees of the companies" aforementioned. Hence, this appeal by certiorari taken by the Union and its members adversely affected by the said resolution. The main issue in this appeal is whether said strike was illegal or not. Respondents herein maintain that it was, because of petitioners’ failure to give a 30-day notice of their intention to strike and because the strike had allegedly been called in bad faith. Upon the other hand, petitioners contend that it was not, for the reason that the strike was provoked by alleged unfair labor practices on the part of the respondents and because said petitioners had acted in good faith in staging said strike. The records show that, immediately after an election held on March 27, 1963, in which Inhelder Laboratories, Inc. and Sister Companies Employees Union obtained the requisite majority, the Union submitted to the Management of said corporations a set of demands for a collective bargaining agreement (Exhibits A, A-1 and 3). This led to negotiations, held, sometimes, with the intervention of the Conciliation Division of the Bureau of Labor, and, sometimes, directly, between the representatives of the parties, without said intervention, and lasting for several weeks. As an agreement was reached on some points, the same were incorporated into a draft of agreement, which, in turn, became the basis for, or was followed by, further negotiations. As additional points of agreement were reached, another draft of agreement was prepared. In a meeting held before said Conciliation Division, in the morning of May 29, 1963, another such draft (Exhibit C-1) was drawn, to which the Management refers as "final draft." However, petitioners’ representatives pressed for the inclusion, in the agreement, of a union clause, an accumulated sick leave clause, and an accumulated vacation leave clause, apart from the increase of the high cost of living monthly allowance from P20.00 to P30.00, the creation of a grievance committee and a general salary increase. The negotiations continued in the afternoon of May 29, 1963, and were resumed in the morning of May 30 or 31, 1963, in the course of which, respondents contend, the Management agreed to increase the high cost of living allowance to P25.00, provided that the other demands were withdrawn, to which petitioners allegedly gave their conformity. Another draft of agreement (Exhibit D) — which the representative of Management, again, characterizes as "final" — was, accordingly, prepared, and the representatives of both parties initialed it, with the understanding, according to respondents, that the agreement would be signed on June 1, 1963. In the afternoon of May 31, 1963, petitioners’ representative called, however, that of Management and asked for the inclusion in the agreement a union shop or union security clause. This request not having been granted, the Union later refused to sign to agreement. The Court of Industrial Relations en banc was of the opinion that, inasmuch as the document last mentioned (Exhibit D) was a "final draft" of the agreement between the parties, and petitioners’ representatives had initialed said draft, "the refusal . . . of the Union to sign the final or clean form of the contract on June 1, 1963, its refusal to honor Exhibit D as a perfected contract and its insistence in negotiating the contract so recently after its perfection are constitutive of bad faith" ; that the strike staged by the Union from July 1 to July 15, 1963, was illegal and those who took part in it are deemed separated from the service. Upon the other hand, His Honor, the trial Judge, held otherwise, upon the ground that the surrounding circumstances were such that petitioners were reasonably justified in believing that the respondents’ acts constituted unfair labor practices and that petitioners had to strike forthwith in order to arrest the evil effects of said practices upon the Union and its members. Upon a review of the record, we are inclined to agree with the latter view. That of the lower court en banc is mainly anchored on the fact that the draft of agreement made and amended in the morning of May 30 or 31, 1963 (Exhibit D), had been initialed by representatives of both parties and that the Management refers thereto as a "final draft." We note, however, that the draft Exhibit C-1, prepared in the morning of May 29, 1963, is, likewise, called by the Management as a "final" draft. Yet, admittedly, negotiations between the parties continued after the preparation of said "final" draft, thus indicating, not only, that the alleged finality thereof reflected, at best, the unilateral opinion of the Management, but, also, that even the latter did not consider it as expressive of a complete, definite and perfected agreement with the petitioners, for, otherwise, the Management would not have participated in the negotiations that took place or continued after the preparation of said Exhibit C-1. These observations apply equally to the "draft" of agreement Exhibit D, prepared and amended in the afternoon of May 29 and the morning of May 30 or 31, 1963. Moreover, the fact that both parties affixed their initials to this "draft" Exhibit D does not necessarily prove that the same was more "final" than the "final draft" (Exhibit C-1) made in the morning of May 29, 1963. Indeed, if the parties had reached, said afternoon and in the morning of May 30 or 31, 1963. a complete agreement on the terms and conditions of their proposed collective bargaining agreement, they could have and would have signed Exhibit D that same morning, instead of agreeing that

the document be formally signed on June 1, 1963. In fact, the agreement to this effect suggests that the parties understood that a contract had not, as yet, been perfected. As His Honor, the trial Judge, had aptly put it, Exhibit D was no more than a draft of contract, not a contract in itself. At this juncture, it is well to remember that, on March 29, 1963, the petitioners had written to the management the letter Exhibit A (also marked as Exhibit 3) enclosing therewith a draft of the collective bargaining agreement (Exhibit A-1) they would wish to have the management, as the basis for negotiations between both parties; that such negotiations lasted from late in March to early in July, 1963; that, as they threshed out their points of difference, those that had been settled were incorporated into another draft or agreement prepared by the management; that the latter was followed by further negotiations on other points; that, when an agreement was reached thereon, another draft incorporating said additional points was made; that when Exhibit D was prepared, several still pending settlement; that among these points were the matter of inclusion in the agreement of a union shop or union security clause, a vacation leave clause, and a sick leave clause, in addition to the increase of the high cost of living monthly allowance from P20.00 to P30.00, and the organization of a grievance committee; that, although in the afternoon of May 29, and the following morning or that of May 31, 1963, the management had agreed on the establishment of said committee and the increase of the high cost of living monthly allowance to P25.00, this did not imply that petitioners had given up their demand for a union shop or union security clause; and that, in the return-towork agreement signed by both parties on July 15, 1963 (Exhibits 1 and 2), said clause was, in fact, included. In other words, contrary to what is intimated in the resolution appealed from, it is not true that petitioner had made new demands, either on May 29 or on May 30 or 31, 1963. Indeed, the demand for a union shop or union security clause, which was the main bone of contention, had been included in the draft of agreement Exhibit A1 enclosed with petitioners’ letter of March 29, 1963. What happened, merely, was that the demands incorporated in said draft were discussed by both parties, one after the other; that an agreement on the former did not connote an abandonment of the latter; and that, after the settlement of one issue, it was understood that the others would be taken up thereafter. It would appear, also, that, after the meeting with the representative of Management, in the morning of May 30, or 31, 1963, petitioners’ representatives reported to the Union the contents of Exhibit D, and that, when the Union members learned that said document did not include the union shop or union security clause, they withdrew from their representatives the authority to sign, on their behalf, the collective bargaining agreement with the Management. Under these circumstances, said representatives could not validly sign said agreement, and their refusal to do so is not and cannot be an act of bad faith. Neither may the Union members be held to have acted in bad faith in so withdrawing said authority from their representatives, unless the clause aforementioned were included in the agreement. That clause was part of their original demands, as set forth in their draft of agreement Exhibit A-1, and their representatives could not waive it without their consent. As a matter of fact, there is reason to believe that when petitioners’ representatives did not sign on June 1, 1963 and subsequently thereto the draft of agreement Exhibit D, as amended and initialed on May 30 or 31, upon the ground that they had no authority to do so without the union shop or union, the Management suspected that this was a mere excuse put up by said representatives of petitioners herein. Hence, on June 7, 1963, the Management sent a memorandum (Exhibits 13 and I) to all of its employees, purporting to inform them of the status of the negotiations with their representative, and stating that the latter had refused to sign the draft of agreement Exhibit D — copies of which were made available to all employees — and instead "came out with a new 1 demand — ‘Union Shop’" — upon the ground that such was the desire of the Union members, who had allegedly disauthorized the officers of the Union. Soon thereafter — or from June 10 to June 15, 1963 — several members of the Union resigned therefrom irrevocably, effective on June 15, 1963, "in view of the apparent failure of our Union officers to enter into a working agreement with our employer for the purpose of improving our lot even in a small way." 2 Considering that this is false, for the Management had already yielded to the demand for an increase in the high cost of living allowance and the creation of a grievance committee; that these resignations took place immediately after the Management had dealt with the Union members directly, through the aforementioned memorandum; and that said resignations were conveyed in identically worded communications (Exhibits 6, 7, 8, 9, and 10), some of which were mimeographed, it was only natural for the petitioners to believe that said resignations had been inspired, if not exacted, by the Management, and that the latter had resorted thereto in order to exert pressured upon the Union and compel the same to sign the draft of agreement (Exhibit D) without the union shop or union security clause. Hence, on June 13, 1963, petitioners filed a 30-day notice of strike (Exhibits 5 and E), upon the ground that respondents had been "bargaining in bad faith." However, the Management, in turn, filed unfair labor practice charges against the Union, for alleged refusal to bargain. Meanwhile, and thereafter — or from June 10 to June 22, 1963 — the Management had transferred two (2) members of the Union, suspended a third one and assigned still another to a work less dignified than that which he did before. 3 So, on June 24, 1963, petitioners filed an unfair labor practice charge against the Management, for the suspension or demotion of union members due allegedly to union activities. On June 25, 1963, the Union gave another notice of strike upon the ground that the Management was engaged in unfair labor practices, by suspending, demoting, intimidating and coercing union members, on account of their union activities. Thereafter and in accordance with a strike from June 26, 1963, the Union staged a strike from July 1 to July 15, 1963, on which latter date the strike was called off in conformity with return-to-work agreements Exhibits 1 and 2, then signed by both parties. Although the Management may have had the strict legal right to take against union members the disciplinary and other administrative measures above referred to, there is no denying the fact that the time chosen by the Management therefor, when considered in relation with the attending circumstances, reasonably justified the belief of the Union that the real or main purpose of the Management was to discourage membership in the Union, to discredit the officers thereof, to weaken the Union and to induce or compel the same to sign the draft of agreement Exhibit D as amended, on May 29 and 30 or 31, 1963. As stated in the decision of His Honor, the trial Judge, said belief was confirmed by the fact that prosecutors of the Court of Industrial Relations found sufficient grounds to file and did file, against the Management, a complaint for unfair labor practices. In other words, both parties had performed acts which understandably induced each to believe that the other was guilty of such practices — although, as we now analyze the whole situation, without the excitement, the heat and the passion of the direct participants in the labor dispute, at the peak thereof, such belief may not turn out to be borne out by the objective realities — and both were reasonably justified in taking the counter measures adopted by them. As a consequence, we hold that the strike in question had been called to off-set what petitioners were warranted 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 strikes had not thereby lost their status as employees of respondents herein. Upon the other hand, considering that the latter have been absolved from the charge of unfair labor practice, the reinstatement of the strikers must be without backpay. Wherefore, the resolution appealed from should be, as it is hereby modified accordingly, without special pronouncement as to costs. It is so ordered. Bengzon, C.J., J.B.L. Reyes, Barrera, Dizon, Regala, Zaldivar and Sanchez, JJ., concur. Makalintal and J.P. Bengzon, JJ., took no part.

P. G.R. No. 37687 March 15, 1982 PEOPLE'S INDUSTRIAL AND COMMERCIAL EMPLOYEES AND WORKERS ORGANIZATION (FFW), ERNESTO PAGAYATAN, ANTONIO ERIÑO, RODRIGO BOADO AND LINO FRANCISCO, petitioners, vs. PEOPLE'S INDUSTRIAL AND COMMERCIAL CORPORATION, FEDERATION OF TENANTS AND LABORERS ORGANIZATION, and THE COURT OF INDUSTRIAL RELATIONS, respondents.

GUERRERO, J.:

Petition for review of the decision and en banc resolution of the Court of Industrial Relations dated April 2, 1973 and October 3, 1973, respectively, promulgated in three (3) consolidated cases. 1

The decision penned by Associate Judge Alberto S. Veloso adopting in full the report of CIR Hearing Examiner Atty. Francisco de los Reyes made the following dispositive portion, thus — After a careful review, scrutiny and evaluation of the records of these cases, as well as of every piece of evidence adduced by the parties, pro and con, this court finds the findings of facts and conclusions of law contained in the aforequoted Report to be amply substantiated, and, therefore, adopts the same as its own. WHEREFORE, in view of all the foregoing, above- entitled cases should therefore be, as they are hereby ordered DISMISSED. SO ORDERED. This petition limits itself to the controversy in Case No. 4498-ULP filed by People's Industrial and Commercial Employees and Workers Organization against People's Industrial and Commercial Corporation and the Federation of Tenants and Laborers Organization. On the basis of the Examiner's Report, the following facts appear: On April 30, 1964, the Federation of Tenants and Laborers Organization, Rizal Chapter, FTLO for short, entered into a collective bargaining agreement with respondent People's Industrial and Commercial Corporation, hereafter referred to as PINCOCO, (Exhibits "2" and "G"). At the time the agreement was consummated, herein individual petitioners, Ernesto Pagayatan, Antonio Eriño, Rodrigo Boado and Lino Francisco, who were also the individual complainants in Case No. 4498-ULP, together with those mentioned in Annex "A" of the complaint (List of some forty-five [45] other employees), were employees of PINCOCO and members of FTLO. The relevant portions of the working agreement stipulate: xxx xxx xxx Art. II. — Union Security Maintenance Shop. Those who are members in good standing of the Union before the signing of this working agreement, shall continue to be union members in good standing as a prerequisite for continued employment in the company. xxx xxx xxx Any employee covered by this agreement who during its term, should resign from the union or shall be expelled therefrom according to its normal procedures for any of the causes hereafter enumerated, shall upon written notice by the union directorate, be discharged from employment, provided that the causes for expulsion from the Union be any of the following: 1. Working in the interest of any labor organization other than the Union which claims or exercises jurisdiction similar to that claimed or exercised by the Union; 2. Refusal to pay or non-payment of Union dues and Assessment; 3. Disloyalty to the Union; 4. Separation from the Union for cause. xxx xxx xxx Art. VIII. No Strike, No Lockout. For the duration of the Agreement, the COMPANY shall not lockout its employees, nor shall the UNION or any employee stage any strike, picket or other concerted activity other than in protest of unfair labor practice, and the court decision in the case that may be filed in this connection shall determine the propriety of such concerned activity under the Agreement. Violation of this paragraph shall be treated as subject to the same sanctions as a violation of the duty to bargain collectively. A stoppage of work or cessation of operation due to poor sales, lack of raw material, or any other business reason, or to force majeure shall not be deemed a lockout for the purpose of the preceding paragraph. In any case that the COMPANY should stop operations due to any of the foregoing reasons, adequate notice shall be given to the UNION whenever possible. xxx xxx xxx Art. XI. Duration of the Agreement. — This agreement shall take effect this — day of April, 1964 and shall only be in effect for a period of one (1) year thereafter. Unless written notice of a desire to terminate or modify the same is given by either party to the other at least thirty (30) days before its expiration, this agreement shall be deemed to be renewed for another year. xxx xxx xxx On October 18, 1964, it appears that with the knowledge of PINCOCO, an election of union officers of the Rizal Chapter of FTLO was conducted by virtue of a resolution (Exhibit "2-FFW", t.s.n., pp. 24-31, October 10, 1969) and that individual petitioners were elected as the new officers with Ernesto Pagayatan as chapter president (Exhibits "4-FFW" and "5-FFW"). On January 10, 1965, individual petitioners together with fifty-one (51) other employees executed a Certification (Exhibit "3-FFW") stating that they are members of the Federation of Tenants and Laborers Organization, but as of the above date, they have changed the name of their union to People's Industrial and Commercial Employees and Workers Organization (PICEWO) and have affiliated this new union with the Federation of

Free Workers, Ernesto Pagayatan was again made the president of the new union (PICEWO) together with the set of officers elected with him in the last election retaining their respective positions. Further, in the same certification, the union counsel of FTLO, Atty. David Advincula, was disauthorized to represent the signatories. The certification contains no specific reason or cause for the change of union name. On February 10, 1965, the new union was granted a certificate of registration by the Department of Labor (Exhibit " 1-FFW "), On March 23, 1965, Ernesto Pagayatan, assuming the capacity of chapter president of FTLO and not as a president of PICEWO, notified in writing respondent PINCOCO of their desire to terminate the working agreement. Later, a set of collective bargaining proposals was sent in the name of PICEWO (Exhibits "e", "10" and " 11 "). PINCOCO replied this wise: xxx xxx xxx That in view of the study effected by the management as to its stand with regard to the said proposals and further submission of the same to our legal counsel for consultation and advice and considering that April 15, 1965 is a legal holiday we cannot serve you, our formal reply within the period specified by existing statute. However, we assure you of our formal reply to your proposal on April 14, 1965 and that management will endeavor to avail of the remedies within the financial capacity of the company and other factors to be considered to meet the terms of your proposal. On April 13, 1965, FTLO passed a resolution expelling petitioners Ernesto Pagayatan, Antonio Eriño Rodrigo Boado and Lino Francisco from the Federation of Tenants and Laborers Organization (FTLO) on grounds of disloyalty and working for the interest of another labor federation (Exhibit "F"). On April 22, 1965, Ernesto Pagayatan, this time as president of PICEWO filed a notice of strike, alleging as cause thereof respondent employer's refusal to bargain. (Exhibit "9-H"). On April 29,1965, prompted by the demand of the majority of the FTLO directorate to enforce the maintenance of membership shop of the working agreement, respondent PINCOCO dismissed Ernesto Pagayatan and his companions from employment (Exhibits "12- FFW "12-A-FFW" to "12-CFFW"). On May 1, 1965, the FTLO and respondent PINCOCO executed a collective bargaining agreement for a period of three (3) years (Exhibits "A-CO" and "D"). Meantime, on April 30, 1965, PICEWO, led by individual petitioners struck. Thereafter, at the behest of the FTLO, respondent PINCOCO posted a notice for the strikers to return to work within a period of five (5) or ten (10) days or else they shall be considered to have abandoned their work. None of the strikers returned and picketing went on for a period of six (6) months. Later, PINCOCO again posted a notice that it had decided to resume operation on March 9, 1966, and between March 7 and 8 of the same year, all employees were advised to signify their ability to work at which time they will be required to submit police clearances and to medical and physical examination by the company physician, otherwise their failure to return within the period shall be considered as abandonment of work. On March 31, 1966 petitioner-union, through its president, signified the intention to return to work beginning April 4, 1966. None of the strikers, however, were allowed to work. From the preceding developments, three separate cases were filed with the Court of Industrial Relations. In Case No. 4428-ULP, FTLO indicted herein individual petitioners for unfair labor practice in staging an illegal strike after they were already dismissed from the company. In Case No. 167-INJ, FTLO sought for the issuance of a permanent injunction to stop the alleged illegal strike. In Case No. 4498-ULP, PICEWO sued PINCOCO and FTLO for unfair labor practice, alleging that by illegally dismissing petitioners, the company discriminated against them in regard to hire, tenure and/or other conditions of employment by unlawfully acceding and effecting the request of FTLO without proper investigation thereof, with no just reason but to encourage membership in the FTLO; and that respondent federation, in recommending and insisting on the dismissal of individual petitioners, had interfered in their right to self-organization. (Annex "C", p. 39, Rollo) After the reception of evidence, the Hearing Examiner designated by the Court of Industrial Relations, reported that the petitioners were, beyond doubt, members of the FTLO when the Working Agreement of April 30, 1964 took effect and that the working agreement required in Article II thereof maintenance of membership in the federation as condition for continued employment in the company. Since the specific causes for expulsion from membership have been enumerated, particularly that of working for the interest of another organization and disloyalty to the union, the Hearing Examiner concluded that petitioners' conduct is within the said causes expressed in the agreement. The Report also established that FTLO is the sole and exclusive bargaining representative of the employees which entered into a bona fide agreement, putting a limitation of petitioners' right to leave the union and join another. The Examiner found no unfair labor practice committed by either the FTLO or PINCOCO, and that the strike staged by petitioners was not on account of any unfair labor practice, but, rather, done to force recognition. Based on the above findings, respondent court dismissed the three cases. On April 10, 1973, petitioners filed their motion for reconsideration; same was denied in the en banc resolution of October 3, 1973. Petitioners now raise the following assignment of errors: a) The respondent court erred in holding that the Motion for Reconsideration and the Memorandum in support of the Motion for Reconsideration were filed out of time; b) The respondent court erred in holding that the strike declared by herein petitioners was intended only to force recognition; c) The respondent court erred in not declaring both respondent Corporation and respondent Federation guilty of committing unfair labor practice; d) The respondent court erred in not declaring as illegal the dismissal from employment of individual petitioners; and e) Respondent court erred in not ordering the return to work of the striking members of petitioner Union with backwages and other fringe benefits from April 30, 1965 until their actual reporting for work. The last day for filing the motion for reconsideration was April 9, 1973 which was a holiday (BATAAN DAY), and the last day for filing the arguments in support of the motion for reconsideration, ten days after, was April 19, 1973, also a holiday (MAUNDY THURSDAY). Since petitioners have filed their pleadings on the next respective business days, that is, April 10, 1973, for the motion for reconsideration and April 23 for the arguments in support thereof (April 20 to 22 not being business days), the pleadings were, therefore, filed on time. On this procedural aspect, the resolution of October 3, 1973 has erred. It is the policy of the law to disregard technicalities in procedure so as not to deprive the litigant's pursuit of his substantial rights under the Rules.

Under Article 13, last paragraph, of the Civil Code, in computing the period, the first day shall be excluded, and the last day included. And under Rule 28 of the Rules of Court, Section 1, time is computed thus — Sec. 1. How to compute time.-In computing any period of time prescribed or allowed by these rules, by order of court, or by any applicable statute, the day of the act, event, or default after the designated period of time begins to run is not to be included. The last day of the period so computed is to be included, unless it is a Sunday or a legal holiday, in which event the time shall run until the end of the next day which is neither a Sunday nor a holiday. Under the second assignment of error, the question to be resolved is whether or not the petitioners' act of disaffiliating themselves from the mother federation constitutes an act of disloyalty to the union which would warrant their expulsion and consequently their dismissal from the company in pursuance to the union security clause embodied in the CBA. Petitioners contend that no disloyalty is involved since what they did on January 10, 1965 was merely to change, as they did change, the name of Rizal Chapter of the Federation of Tenants and Laborers Organization FTLO to People's Industrial and Commercial Employees and Workers Organization (PICEWO). While We are not convinced with the petitioners' argument that the only act that they have done was to change the name of their union for they have registered the new union and affiliated it with the Federation of Free Workers, We rule that individual petitioners do not merit the dismissals meted by the company.

We held that the validity of the dismissals pursuant to the security clause of the CBA hinges on the validity of the disaffiliation of the local union from the federation. It was further held in this case that PAFLU (the federation) had the status of an agent while the local union remained the basic unit of association free to serve the common interest of all its members including the freedom to disaffiliate when the circumstances warrant such an act. The Supreme Court, speaking thru Justice Esguerra, said: In Liberty Cotton Mills Workers Union vs. Liberty Cotton Mills, 2

All these questions boil down to the single issue of whether or not the dismissal of the complaining employees, petitioners herein, was justified or not. The resolution of this question hinges on a precise and careful analysis of the Collective Bargaining Agreements. (Exhs. "H" and "l"). In these contracts it appears that PAFLU has been recognized as the sole bargaining agent for all the employees of the Company other than its supervisors and security guards. Moreover it likewise appears that "PAFLU, represented in this Act by its National Treasurer, and duly authorized representative, ... (was) acting for and in behalf of its affiliate, the Liberty Cotton Mills Workers Union and the employees of the Company, etc." In other words, the PAFLU, acting for and in behalf of its affiliate, had the status of an agent while the local union remained the basic unit of the association free to serve the common interest of all its members including the freedom to disaffiliate when the circumstances warrant. This is clearly provided in its Constitution and By-Laws, specifically Article X on Union Affiliation, supra. At this point, relevant is the ruling in an American case. (Harker et al. vs. Mckissock et al., 81A 2d 480, 482). The locals are separate and distinct units primarily designed to secure and maintain an equality of bargaining power between the employer and their employee-members in the economic struggle for the fruits of the joint productive effort of labor and capital; and the association of the locals into the national union (as PAFLU) was in furtherance of the same end. These associations are consensual entities capable of entering into such legal relations with their members. The essential purpose was the affiliation of the local unions into a common enterprise to increase by collective action the common bargaining power in respect of the terms and conditions of labor. Yet the locals remained the basic units of association, free to serve their own and the common interest of all, subject to the restraints imposed by the Constitution and By-Laws of the Association, and free also to renounce the affiliation for mutual welfare upon the terms laid down in the agreement which brought it into existence. The right of the local members to withdraw from the federation and to form a new local depends upon the provisions of the union's constitution, by- laws and charter. In the absence of enforceable provisions in the federation's constitution preventing disaffiliation of a local union, a local may sever its relationship with its parent. There is nothing shown in the records nor is it claimed by respondent federation that the local union was expressly forbidden to disaffiliate from the federation. Except for the union security clause, the federation claims no other ground in expelling four of the fifty-one who signed the certification. Fifty-one out of sixty employees is equivalent to eighty five percent (85%) of the total working force. This is not a case where one or two members of the old union decided to organize another union in order to topple down the former, but it is a case where majority of the union members decided to reorganize the union and to disaffiliate from the mother federation. There is no merit to the contention of the respondent federation that the act of disaffiliation is disloyalty to the union. The federation and the union are two different entities and it was the federation which actively initiated the dismissal of the individual petitioners. A local union does not owe its existence to the federation to which it is affiliated. It is a separate and distinct voluntary association owing its creation and continued existence to the will of its members. The very essence of self-organization is for the workers to form a group for the effective enhancement and protection of their common interests. The third, fourth and fifth assignment of errors maybe resolved on the same issue which is the legality of the strike and the consequences thereof. Petitioners allege that the strike which was started on April 30, 1965 was staged because of the unfair labor practice of the respondent company in refusing to bargain collectively with PICEWO and in dismissing individual petitioners. The Hearing Officer in his Report which was adopted in full by the Court of Industrial Relations settled the legality of the strike in the following manner: xxx xxx xxx While the reply of respondent PINCOCO to the proposal of the new union evokes ambiguity, the same may not be treated as a refusal to bargain. At the time the letter proposal was sent, the presumed bargaining agent was the FTLO. No showing had been made that the

PICEWO, upon its organization was should should have been accorded the status of a majority bargaining representative. The letter reply of PINCOCO, although it seem to cast doubt as to its motivation, should not be held and taken against it as a positive design to discriminate in the absence of any additional or corroborative showing that the new union actually represented the majority of the employees in the unit and that this fact was known to the management. The strike therefore of the PICEWO was not on account of any unfair labor practice acts committed by the respondent PINCOCO. It seem to have been more of a strike to force recognition. xxx xxx xxx We do not agree with the finding of the Hearing Officer that the strike was staged to force recognition. The chain of events which preceded the strike belie this conclusion. On April 5, 1965, Ernesto Pagayatan, the president of PICEWO sent to the management a set of proposals for a collective bargaining agreement. The management on April 13, 1965 replied that the formal reply to the proposals cannot be made within the reglementary period because they will submit the said proposals to their legal counsel for further study and instead their reply would be made on April 19, 1965. No reply was made on that date. On April 29, 1965, individual petitioners were dismissed. A strike was staged the next day. One day after the petitioners struck, a new collective bargaining agreement was signed by the respondent company and the FTLO. The respondent company knew that a new union was formed composed of about 85% of the total number of its employees. It was furnished a copy of the certification that the majority of the FTLO members are forming a new union called PICEWO. The set of bargaining proposals were in the name of the new union. While a company cannot be forced to sit down and bargain collectively with the new union since it had no notice of the union's official capacity to act as the bargaining agent, the respondent company cannot deny that it had factual knowledge of the existence of a majority union. It could have asked for further proof that the new union was indeed the certified bargaining agent. It did not. Instead, it dismissed individual petitioners and signed a new CBA the day after the expiration of the old CBA, on the pretext that FTLO was presumed to be the certified bargaining agent. Such pretext does not seem justified nor reasonable in the face of the established fact that a new union enjoyed a majority status within the company. On the belief that the respondent company refused to bargain collectively with PICEWO, individual petitioners together with the other members staged a strike. We have in several cases ruled that a strike may be considered legal when the union believed that the respondent company committed unfair labor acts and the circumstances warranted such belief in good faith although subsequently such allegation of unfair labor practices are found out as not true.

Thus, in Norton and Harrison Co. and Jackbilt Blocks company Labor Union (NLU) vs. Norton and Harrison, et al., 3We

held that "the act of the company in dismissing Arcaina done without the required fair hearing, and, therefore, not tenable even under strict legal ground, induced the union and its members to believe that said company was guilty of unfair labor practice although viewed now in retrospect said act would fall short of unfair labor practice. Since the strike of the union was in response to what it was warranted in believing in good faith to be unfair labor practice on the part of the management, said strike following the berrer ruling did not result in the termination of the striking members' status as employees and therefore, they are still entitled to reinstatement without backwages." ruling was also upheld in Shell Oil Workers Union vs. Shell Company of the Phil. Ltd. where We stated that "(i)t 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 clearly stated by the present Chief Justice while still an Associate Justice of this Court: 'As a consequence, we hold that the strike in question had been called to offset what petitioners were warranted 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. The Ferrer 4

5

The Ferrer ruling was promulgated in 1966, that in the Shell Oil case in 1971. In 1980, there was the case of Pepito vs. Secretary of Labor, L-49418, Feb. 29, 1980, where petitioner therein was separated for having been implicated in a pilferage case by a co-employee but was later absolved from the charge. The Supreme Court thru Chief Justice Fernando ruled that the cause for his dismissal was proved non-existent or false and thus ordered his reinstatement with three years backwages, without deduction and qualification. We adopt the Pepito ruling and We hold that the petitioners in the case at bar are entitled not only to reinstatement but also to three years backwages without deduction and qualification. This is . justified and proper since the strike was proved and We held the same to be not illegal but was induced in the honest belief that management had committed unfair labor practices and, therefore, the cause of their dismissal from employment was non-existent. It is clear that management gave cause or reason to induce the staging of the strike by improperly refusing to recognize the new union formed by petitioners. It has been twelve (12) years since petitioners were dismissed from their employment and in their destitute and deplorable condition, to them the benign provisions of the New Constitution for the protection of labor, assuring the rights of workers to self- organization, collective bargaining and security of tenure would be useless and meaningless. Labor, being the weaker in economic power and resources than capital, deserve protection that — is actually substantial and material. WHEREFORE, IN VIEW OF THE FOREGOING, the decision under review is hereby SET ASIDE. The respondent company is hereby ordered to reinstate individual petitioners and other striking members within thirty (30) days from notice of this decision, with backwages equivalent, to three (3) years at the rates actually received by them before their dismissal without deduction and qualification. In view of the length of time that this dispute has been pending, this decision shall be immediately executory upon promulgation and notice to the parties. Without pronouncement as to costs.

SO ORDERED.

Q. [G.R. No. 123276. August 18, 1997]

MARIO TIU and JONATHAN HAYUHAY, petitioner, vs. NATIONAL LABOR COMMISSION and REPUBLIC BROADCASTING SYSTEM, INC. (CHANNEL 7), respondent. DECISION PADILLA, J.:

This is a petition for certiorari under Rule 65 of the Rules of Court to annul and set aside the resolution of the National Labor Relations Commission (NLRC) dated 28 November 1994 in NCR Case No. 00-08-0453-91 which affirmed the decision of labor arbiter Edgardo Madriaga dated 18 February 1994 holding the strike held by GMA Channel 7 Employees Union (GMAEU) on 2 August 1991 as illegal and declaring the fourteen (14) GMAEU union officers who knowingly participated in the illegal strike to have lost their employment status. The records show that of the fourteen (14) GMAEU officers involved in the strike, ten (10) officers did not appeal the labor arbiters decision and opted to avail of the optional retirement benefits under the collective bargaining agreement with private respondent Republic Broadcasting System Inc. (RBS). The remaining four (4) union officers, namely: Mario Tiu, Nani Hayuhay, Bong Cerezo and Virgilio Santoyo, appealed to the NLRC. From the NLRC decision, Virgilio Santoyo filed a separate petition for certiorari before this Court, docketed as G.R. No. 122613. In a resolution dated 31 January 1996, the Court dismissed Santoyos petition for failure to sufficiently show that the respondent Commission (NLRC) had committed a grave abuse of discretion in rendering the questioned judgment. Considering that Santoyo and herein petitioners were dismissed under the same factual circumstance, the Court reviewed the records of G.R. No. 122613 to determine whether the ruling laid therein applies in the case at bar. The Court notes that the issues raised by Santoyo in his petition were procedural in character. Santoyo alleged that he was never represented by counsel in the proceedings both before the labor arbiter and the NLRC and was denied the opportunity to present his evidence. This allegation, however, had no factual basis as the records showed that he was represented by

counsel during the entire proceedings below. In contrast, the present petition raised substantive issues concerning the legality or illegality of the strike conducted by GMAEU on 2 August 1991. The Court required both public and private respondents to file their comment on the petition. Private respondent RBS filed its comment on 23 April 1996 and public respondent NLRC filed its own comment on 9 December 1996. Petitioners filed a reply to both comments on 4 March 1997. Since the parties have exhaustively argued their position in their respective pleadings, the Court dispensed with the filing of memoranda and considered this case submitted for resolution. The material and relevant facts are as follows: RBS had a collective bargaining agreement with GMAEU which took effect on 2 July 1989. After the first quarter of 1991, RBS management noted the huge amount of overtime expense it incurred during the said period, which averaged to P363,085.26 monthly. To streamline its operations, the president of RBS created a committee to formulate guidelines on the availment of leaves and rendering of overtime work. On 11 June 1991, RBS, through its personnel department, furnished GMAEU a copy of the new guidelines and requested the latter to comment thereon. The union did not file any comment. On 25 June 1991, RBS officially issued the implementing guidelines on the availment of leaves and rendering of overtime services. The following day, GMAEU sent a letter to the president of RBS wherein it argued that: 1. The union was not consulted in the formulation of said guidelines which was clear violation under Sec. 3(c) of the collective bargaining agreement; 2. The guidelines would render nugatory the collective bargaining agreement provisions on the same subject; 3. The diminution of benefits being enjoyed by all employees with respect to the midyear bonuses (from 2-1/2 months to 1-1/2 months constitutes a withdrawal of an existing company policy).

Thereafter, RBS management and GMAEU officials met on 3 July 1991 and on 10 July 1991 to thresh out the issues raised by GMAEU in its 26 June 1991 letter. Both talks, however, were short lived as the union refused to hold further talks with RBS. On 12 July 1991, GMAEU filed a Notice of Strike with the National Conciliation and Mediation Board (NCMB) based on unfair labor practices allegedly committed by RBS, as follows: 1. Gross violation of the existing collective bargaining agreement;

2. Employees (members and officers) coercion; 3. Union interference; and 4. Discrimination.

The NCMB set a conciliation meeting on 19 July 1991, but as early as 16 July 1991 the Union held a strike vote among its members and submitted the results thereof to the NCMB on 18 July 1991 which showed that majority of the union members voted to go on strike. During the conciliation meeting held on 19 July 1991, RBS, through counsel, informed GMAEUs officers that RBS did not violate any provision in the collective bargaining agreement since the issuance of the guidelines was a management prerogative duly recognized in their agreement. As regards GMAEUs charges of coercion, union interference and discrimination, RBS argued that these alleged unfair labor practices were neither raised by the union in its 26 June 1991 letter nor during their 3 July and 10 July 1991 talks. RBS counsel requested GMAEUs officers to name the persons or officers of RBS involved in the alleged unfair labor practices and to state the specific act or acts complained of so that RBS management could adequately refute said allegations or impose appropriate disciplinary actions against its erring officers. GMAEUs officers, however, ignored both RBS and the labor conciliators requests for a bill of particulars. In a second conciliation meeting held on 25 July 1991, RBS reiterated its request to GMAEUs officers to furnish RBS the details of the alleged unfair practices committed by RBS officers. Again, the Union denied RBS request and refused to hold any further talks with RBS management. On the same day, RBS filed a motion to dismiss GMAEUs notice of strike and forewarned the Union about the consequences of an illegal strike. On 2 August 1991, the union struck. On the same day, RBS filed a complaint for illegal strike and unfair labor practice against GMAEU and its fourteen (14) officers (hereafter, illegal strike case). The case was docketed as NLRC Case 00-08-04531-91. Meanwhile, the Secretary of Labor immediately assumed jurisdiction over the case, issued a return-to-work order, and certified the case to the NLRC for compulsory arbitration (hereafter, certified case). The case was docketed as NCMB-NCR-050-7-488-91. In the certified case, the labor arbiter found no factual and legal ground to hold RBS guilty of unfair labor practices against the Union. On appeal (docketed as NLRC-NCR CC No 00076-01), the NLRC affirmed the labor arbiters decision in a resolution dated 31 July 1992.

Meanwhile, the labor arbiter continued to hear the illegal strike case filed by RBS against GMAEU. On 18 February 1994, the labor arbiter rendered judgment declaring the strike illegal and the union officers who knowingly participated in the illegal strike to have validly lost their employment status based on the following reasons: a. The notice of strike did not specifically charge the company (RBS) of unfair labor practices, only pro forma allegations of gross violation of the collective bargaining agreement, employees coercion, union interference, and discrimination. It is defective as it consisted of vague and general charges which could not be substantiated and which the company could not properly defend itself against. b. The absence of evidence on record that the mandatory cooling-off period and strike vote under the law were complied which renders the strike staged by the respondents illegal per se on technical grounds. c. On the merits x x x there are no strikeable grounds as there was no bargaining deadlock between the parties. The alleged gross violation of the collective bargaining agreement cannot constitute an unfair labor practice because said charges were bereft of factual and legal basis. There being no unfair labor practice, it follows that there is no strikeable issue to support the strike conducted by herein respondents (the Union). d. The union violated the no strike-no lockout clause of the CBA with RBS; thus rendering the strike held on 2 August 1991 illegal. As aforementioned, the NLRC affirmed the labor arbiters decision in a resolution dated 28 November 1994. In their petition, petitioner raised six (6) alleged NLRC errors which ultimately narrow down to one issueWHETHER OR NOT THE NLRC COMMITTED GRAVE ABUSE OF DISCRETION WHEN IT UPHELD THE LABOR ARBITERS DECISION THAT PETITIONERS STAGED AN ILLEGAL STRIKE ON 2 AUGUST 1991. Petitioners argue that any defect in their pro-forma notice of strike was cured when the NCMB took cognizance of the case and conducted conciliation proceedings on 19 July and 25 July 1991. In addition, upon assumption by the Secretary of Labor of jurisdiction over the dispute and certification of the same for compulsory arbitration, it is presumed that the union had complied with the procedural requirements under the labor code for a valid notice of strike. Anent the alleged unfair labor practices committed by RBS, petitioners assert that this issue was thoroughly discussed with sufficient particularity in

their position papers filed in the certified case and in the illegal strike case; hence, there notice of strike was sufficient in form and in substance. Petitioners further argue that they believed in good faith that RBS had committed acts of unfair labor practice which induced them to proceed with the strike on 2 August 1991. Since it was an unfair labor practice strike, the no-strike clause in the collective bargaining agreement with RBS does not apply. They also showed good faith by their immediate compliance with the return-to-work order issued by the Secretary of Labor upon assuming jurisdiction over the case. Private respondent RBS refutes these arguments and asserts that the factual findings of the labor arbiter and the NLRC, being supported by substantial evidence, should be upheld by this Court. This means that petitioners cannot invoke the protective mantle of the good faith strike doctrine because the alleged issues in the notice of strike were never substantiated by the union either before or during the conciliation proceedings. The union violated the no strike clause under the collective bargaining agreement and should be held accountable for their acts by considering them validly dismissed from their employment with RBS. We find no merit in the petition at bar. The notice of strike filed by the union before the NCMB on 12 July 1991 contained general allegations that RBS management committed unfair labor practices by its gross violation of the economic provisions in their collective bargaining agreement and by alleged acts of coercion, union interference and discrimination which amounted to union busting. It is the union, therefore, who had the burden of proof to present substantial evidence to support these allegations. It is not disputed that prior to 12 July 1991, the union treated RBS issuance of the guidelines on the availment of leaves and rendering of overtime services as gross violations of the existing collective bargaining agreement. In its talks with the union, RBS painstakingly explained that the said allegation was unfounded because the issuance of said guidelines was RBS management prerogative. Up to that point, the union never raised the issue of unfair labor practices allegedly committed by RBS official under Article 248 of the Labor Code. But in its notice of strike filed two days later, the union raised issues of coercion, discrimination, and union interference for the first time. Significantly, the union had two (2) conciliatory meetings arranged by the NCMB at which it could have substantiated these additional

allegations.However, the fact that it had submitted the results of the strike vote even ahead of the conciliatory meetings, and continuously refused to substantiate its allegations in its notice of strike thereafter, lends credence to the NLRCs observation that these charges were indiscriminately hurled against RBS to give a semblance of validity to its notice of strike. Under Rule XIII Sec. 4 Book V of the Implementing Rules of the Labor Code x x x x. In cases of unfair labor practices, the notice of strike shall as far as practicable, state the acts complained of and he efforts to resolve the dispute amicably. Upon the other hand, Rule III Sec. 6 provides that xxx xxx xxx During the (conciliation) proceeding, the parties shall not do any act which may disrupt or impede the early settlement of the dispute. They are obliged, as part of their duty to bargain collectively in good faith, to participate fully and promptly in the conciliation meetings called by the regional branch of the board. x x x. (emphasis supplied) Petitioners plead that their contemporaneous acts, reckoned from their June 1991 letter to RBS up to the actual strike held on 2 August 1991, were justified based on its honest belief that RBS was committing unfair labor practices. Stated otherwise, the presumption of legality (of the strike) prevails even if the allegations of unfair labor practices are subsequently found out to be untrue. (citing Master Iron Labor Union v. NLRC, 219 SCRA 47) The Court is not unmindful of this rule, but in the case at bar the facts and the evidence did not establish even at least a rational basis why the union would wield a strike based on alleged unfair labor practices it did not even bother to substantiate during the conciliation proceedings. It is not enough that the union believed that the employer committed acts of unfair labor practice when the circumstances clearly negate even a prima facieshowing to warrant such a belief. The Court affirms the factual finding of the labor arbiter and the NLRC that there was no strikeable issue to support respondents (the Union) subject strike. The evidence show that the union anchored its position on alleged unfair labor practices in order to evade not only the grievance machinery but also the no strike clause in their collective bargaining agreement with RBS.

RBS did not issue is implementing guidelines dated 24 June 1991 concerning the availment of leaves and rendering of overtime services in an arbitrary manner. The union was promptly informed that RBS decision was based on its management prerogative to regulate all aspects of employment, subject of course to well-defined limitations imposed by law or by contract. Even assuming arguendo that in the issuance of said guidelines RBS may have violated some provisions in the collective bargaining agreement, there was no palpable showing that the same was a flagrant and/or malicious refusal to comply with its economic provisions. (Book V Implementing Rules of the Labor Code, Rule XIII, Section 1) Hence, the law mandates that said violation shall not be considered unfair labor practice and shall not be strikeable. The bottom line is that the union should have immediately resorted to the grievance machinery established in their agreement with RBS. In disregarding said procedure the union leaders who knowingly participated in the illegal strike have acted unreasonably, and, as such, the law cannot interpose its hand to protect them from the consequences of their behavior. (National labor Union v. Philippine Match Factory, 70 Phil. 300; United Seamens Union v. Davao Shipowners Association, 20 SCRA 1226) WHEREFORE, premises considered, the petition is hereby DISMISSED, there being no substantial evidence of grave abuse of discretion amounting to lack or excess of jurisdiction on the part of the NLRC. SO ORDERED.

R. [G.R. No. 113466. December 15, 1997]

NATIONAL FEDERATION OF LABOR (NFL), AMADO MAGBANUA AND 141 OTHERS NAMELY: RODELIO PURISMA, AURORA TAN, EFREN GARCIA, RONILO PARCON, HERMICILLA MANLUCOT, JOSEPHINE ADORABLE, EVELYN BERNARDO, ELONA WATIN, GERALDINE ACUNA, LOLITA UGUIS, VILMA BAYONA, JOCELYN TORRES, MYRNA TORRALBA, GUADALUPE SUMICAD, TERESITA NAMOCA, JERRY EBIAS, GERONIMO ALICANDO, MERLENE BANAWAG, JAIME NOBLEZA, ALEXANDER BALANCAR, CESAR ABDULA, JOSEPHINE

FRANCISCO, ROEL LA TORRE, NICASIO BOLINGKIT, JIMMY BORADA, JOSELITO GERMO, JOHENES FABRICA, ZALDY TUPAZ, RAMON CAWILI, DELFIN OBA-OB, REYNALDO LONGNO, ARTEMIO GUNHURAN, DANILO JISON, CAPISTRANO MANLUCOT, ALEX ROGADOR, DANILO LONGNO, ALIPIO PETIL, JOEL ORONG, MELCHOR REFUGIO, JOSE ETOQUILA, EDWIN GATPOLINTAN, MAXIMO ANADIO, ALICIA CATAYTAY, LYDIA ESPERAT, JOSEPHINE TALBA, LUCILLE ALICUNDO, GEMMA ALAWI, AIDA SANTILLAN, EVANGELINE SOMOSA, ROSARIO AQUINO, EVELYN DULAP, ROSALINA GERMO, JOCELYN BASING, JESSICA NAPOLERYES, SUSAN DAYOT, JOVITA ALBON, SATURNINA GUEVARRA, JUVY BRITO, RUTH BUNTIS, ELENITA PACHES, BAING GARCIA, JOSEFA ROGADOR, JUDITH GABUYAN, AGNES PAJA, MARIEL DANAG, DELY BUCOY, EVANGELINE MONTUNO, DOLORES BOVLEZA, NORMA DA LEON, GLORIA ATILANO, PRECIOSA BAYTONG, EVELYN TANJUSAY, ARLENE HANDI, JENNIFER VILLANUEVA, LIGAYA DUARONG, FLORA SEBAYLOS, SALVACION CARPIO, EMILIANA SANTIAGO, DOLORES OBLINA, MADELYN JALAO, SOCORRO EDUARTE, CRESENCIA ALFORQUE, SUSANA TARROZA, EDWINA CABAS, NENITA TIMPANGCO, VICTORIA GAPASIN, CARINA ENRIQUEZ, EVELYN FERNANDEZ, MERCY CATAYLO, GREGORIA OSIN, FLORITA PADUA, TITA FRANCISCO, VICTORIA POGOSA, RITA SANCHEZ, LEILANIE DUMAGCO, TERESITA NOBLEZA, MA. DOLORES RAVAL, ABDULA BEDIO, ANNABELLE PAULINO, ANNALIZA LIM, JUANITA ALICANDO, RAYAMAY PANAS, RACHEL GABUYAN, ELIZABETH REGIDOR, ARLENE SUAN, LETICIA ENRIQUEZ, ELENA ETOQUILLA, GERTUDES TUG, EDDIE TANJUSAY, MELQUIADES PINDULAS, REYNERIO ROJAS, SUSAN SALGAN, MA. ISABEL ALMONTE, LUZ DUNGOG, FLORINDA VALENTE, VIVENCIO ATUY, MAXIMA ALFANTTA, WILLY RECTO, REYNALDO BANTILLAN, ERNESTO SEDENO, EDWINA CAWILI, ARACELI RAVAL, MARCELINA BULAC, MA. ELENA GERMAN, PILAR GENA, NESTOR ALAWI, HERCULANOLAS PINAS, GIDEON BRITO, JIMMY NOBLEZA, LORETO GERMAN, AMINA DASAN, ROSEBETH LIBRERO, ADELINA CABILIN, ELIZABETH MATAS, MYRNA PELISAN, MILAGROS DEL MUNDO, ANTONIETA BELARMINO, CLARIBEL CUSTODIO, VILMA JUMAWAN, JORELYN CAMUMOT, AND MA. CLARA

SALVADOR, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION FIFTH DIVISION (NLRC), PERMEX PRODUCER AND EXPORTER CORPORATION, TAN TAY CUAN, JENNIFER PUNZALAN, EDGAR LIM, DOMINIC TAN and GEORGE SYCHUAN, respondents. DECISION ROMERO, J.:

This is a petition for certiorari from the decision of the National Labor Relations Commission dated August 6, 1993 affirming the consolidated decision jointly rendered by Labor Arbiters Reynaldo Villena and Allen Abubakar in RAB Case No. 09-02-00062-93 and 09-02-00069-93 involving illegal strike and unfair labor practice, the dispositive portion of which reads: WHEREFORE, based on the foregoing we hereby declare: 1. That the strike staged and conducted by respondents in NLRC RAB Case No. 0902-00062-93 on January 25 and 26, 1993 and on February 11 to March 29, 1993 as illegal; 2. The complaint filed by complainants in NLRC Case No. RAB 09-02-00069-93 against PERMEX, including its officers for unfair labor practice with claims for damages and backwages, dismissed for lack of merit; and 3. Respondents in NLRC Case No. RAB 09-02-00062-93 liable jointly and severally to petitioner for moral and exemplary damages in the amount of P500,000.00 and P300,000.00 respectively, as prayed for in its Amended Complaint; 4. The dismissal of all respondents in NLRC Case No. 09-02-00062-93 as valid; 5. All other claims are hereby dismissed for lack of merit.

SO ORDERED. The facts, as culled from the record, are as follows: Respondent PERMEX Producer and Exporter Corporation (hereinafter referred to as PERMEX for brevity) is a Zamboanga City-based corporation engaged in the business of fish and tuna export while its co-respondents are its corporate officers. Petitioners, on the other hand, are the National Federation of Labor (hereinafter referred to as NFL for brevity), a legitimate labor federation represented by its Regional Director for Western Mindanao Amado Magbanua, and 141 members of said union, who are dismissed employees of respondent corporation.

On January 23, 1993, NFL contends that 10 union officials who had attended a schedule certificate election conference the previous day were barred from entering the company premises and were prohibited to work therein, allegedly due to their union activities. The NLRC, however, upheld the contention of PERMEX that three of said workers asked to be excused from work while the rest were given time off in order to attend to union activities and were told to return on January 30, 1993. It thus found that the companys actuations did not consist in a lockout but were related to disciplinary matters not in any way connected with a labor dispute. Furthermore, the record shows that the ten (10) workers concerned did not report for work in the morning of January 22, 1993, although the pre-election conference was yet to be held at 1:30 in the afternoon of the same day. Yet another group of workers which attended the conference reported for work the next day. In the words of the NLRC: if the group of ten were subjected to some disciplinary action by management, the same was justified not because of their union affiliations but for breach of company discipline. In other words, the group of ten were (sic) using their union activities to go on undertime or to justify their constant and frequent absences which evidently was a violation of company policy. [1]

Be that as it may, on January 25, 1993 said workers attempted to re-enter the company premises but were prevented from doing so, prompting several of their co-workers to seek an audience with the President and General Manager who was then within premises. Their efforts having been allegedly rebuffed, over 200 workers staged a picket outside company premises. The gates were barricaded, thus blocking ingress and egress of company vehicles, trapping 50 workers inside and paralyzing company operations. Additionally, 700 non-striking workers were prevented from working on January 26, 1997. The workers only returned to work on January 27, 1993 when a memorandum of agreement was forged the same day between representatives of PERMEX and NFL. Pursuant to the agreement, PERMEX issued a memorandum requiring the workers concerned to fully explain their participation in the above-mentioned strike. However, most workers refused to submit explanations, prompting the management to place them under preventive suspension effective February 13, 1993. Only about 40 workers who proffered satisfactory explanations were allowed to return to work. On January 29, 1993, NFL filed a Notice of Strike with the National Conciliation and Mediation Board-Region IX of Zamboanga City. Said notice was contested by PERMEX on February 5, 1993 during the conciliation meeting, prompting NFL to file a new Notice of Strike the same day. Said

Notice alleged discrimination, coercion, union busting, blacklisting of union members, intimidation and dismissal of union officers and members. In the interim, on February 3, 1993 PERMEX filed Case No. RAB 09-0200062-93 against Amado Magbanua et al. to declare the strike held on January 25 and 26 as illegal. This was assigned to Labor Arbiter Reynaldo S. Villena. Likewise, on February 8, 1993, NFL filed Case No. RAB 09-02-0006993 against PERMEX for unfair labor practice and damages, the same being assigned to Labor Arbiter Allen Abubakar. Another conciliation meeting was held on February 10, 1993 in connection with the February 5, 1993 Notice of Strike. However, on February 11, 1993 the workers affiliated with NFL barricaded the company gates, tying the same with ropes and chains and preventing non-striking workers from entering or leaving the premises. Thus, from February 12 to march 2, 1993, the company was constrained to ferry its workers to and from the company premises through its wharf with the use of motorboats. On March 3, 1993, the striking workers cut the company fence leading to the wharf, gained control of the same, and chained close the last point of entrance and exit to and from the premises. The records also show that acts of coercion, intimidation and harassment were committed by the striking workers, including the uttering of threats of bodily harm against non-striking workers and company officials. On March 11, 1993 the secretary of Labor assumed jurisdiction over the dispute pursuant to a petition of NFL filed on January 29, 1993. He likewise issued a Return-to-Work Order to take effect within 24 hours from receipt thereof. PERMEX publicly announced through print and radio that all striking workers should return by March 15, 1993. However, the intercession of PNP agents notwithstanding, the same was ignored. It was only on March 29, 1993 that the workers finally lifted their picket lines. Thereafter, Labor Arbiters Villena and Abubakar issued the consolidated decision now being assailed. NFL then appealed to the NLRC. However, the NLRCs 5 Division, on August 6, 1993, affirmed the decision of the Labor Arbiter but awarded only P300,000.00 as compensatory damages to PERMEX. NFLs motion for reconsideration was denied, hence this petition for certiorari with this Court. th

Petitioner contends that the NLRC committed grave abuse of discretion when the latter disregarded the affidavits and other evidence submitted by it, as well as by its failure to conduct actual open hearings to prove petitioners claims. Furthermore, petitioner contends that the NLRC gravely abused its discretion when it upheld the dismissal of 141 employees on the basis of a

resolution of the City Fiscals Office finding a prima facie case against said employees for illegal acts committed during the strikes in question. Lastly, petitioner contends that company internal reports of spoiled products, which are unverified and unaudited are not competent evidence to prove damages caused by the concerted action of the workers. We rule for the respondent. The first issue raised by petitioner relates to the veracity of the factual findings of the NLRC and the Labor Arbiter. At the outset, it should be noted that a petition for certiorari under Rule 65 of the Rules of Court will prosper only if there is a showing of grave abuse of discretion or an act without or in excess of jurisdiction on the part of the National Labor Relations Commission. It does not include an inquiry as to the correctness of the evaluation of evidence which was the basis of the labor official or officer in determining his conclusion. It is not for this Court to re-examine conflicting evidence, re-evaluate the credibility of witnesses nor substitute the findings of fact of an administrative tribunal which has gained expertise in its special field.Considering that the findings of fact of the Labor Arbiter and the NLRC are supported by evidence on record, the same must be accorded due respect and finality. [2]

Then too petitioner, with great vigor, argues that a full-blown trial should have been conducted by the NLRC in order to uncover the truth of the parties respective assertions, the absence of which is alleged to constitute a denial of due process. Petitioner should bear in mind that a formal or trial-type hearing is not at all times and in all instances essential to due process, the requirements of which are satisfied where parties are afforded fair and reasonable opportunity to explain their side of the controversy at hand. In instant case, its arguments are unavailing where the records show that they were given ample opportunity to present, as they did so present, affidavits and position papers where they set out their factual and legal arguments. [3]

Furthermore, the holding of a trial is discretionary on the labor arbiter and cannot be demanded as a matter of right by the parties. As further elucidated in Palomado v. NLRC, et. al. we do not see how the failure of the arbiter to conduct a formal hearing could constitute grave abuse of discretion. Sec. 3, Rule VII grants an arbiter wide latitude to determine whether there is a need for a formal hearing or investigation x x x after the submission by the parties of their position papers and supporting proofs (P)etitioner believes that had there been a formal hearing, the arbiters alleged mistaken reliance on some of the documentary evidence submitted by parties [4]

[5]

would have been cured and remedied by them, presumably through the presentation of controverting evidence. Evidently, this postulate is not in consonace with the need for speedy disposition of labor cases, for the parties may then willfully withold their evidence and disclose the same only during the formal hearing, thus creating surprises which could merely complicate the issues and prolong the trial. There is a dire need to lessen technicalities in the process of settling labor disputes. In addition, and as stated earlier, it is a general rule that findings of administrative agencies are accorded not only respect but even finality. It is well established that findings of facts of the National Labor Relations Commission are binding on the Supreme Court, if supported by substantial evidence. In the instant case, the findings of the NLRC that the strike held by NFL and its members on January 25-26 and again on February 11-March 29 were illegal are supported by the evidence on record. A strike (or lockout), to enjoy the protection of law, must observe certain procedural requisites mentioned in Art. 263 and the Implementing Rules, namely: 1) A notice of strike, with the required contents, should be filed with the DOLE, specifically the Regional Branch of the NCMB, copy furnished the employer of the union; 2) A cooling-off period must be observed between the filing of notice and the actual execution of the strike thirty (30) days in case of bargaining deadlock and fifteen (15) days in case of unfair labor practice. However, in the case of union busting where the unions existence is threatened, the cooling-off period need not be observed. xxx xxx xxx 4) Before a strike is actually commenced, a strike vote should be taken by secret balloting, with a 24-hour prior notice to NCMB. The decision to declare a strike requires the secret-ballot approval of majority of the total union membership in the bargaining unit concerned. 5) The result of the strike vote should be reported to the NCMB at least seven (7) days before the intended strike or lockout, subject to the cooling-off period. [6]

The provisions hardly leave any room for doubt that the cooling-off period in Art. 264(c) and seven-day strike ban after the strike-vote report prescribed in Art. 264(f)

were meant to be, and should be deemed, mandatory [Art. 264 should now read Art. 263]. [7]

In the case at bar, no notice of strike, as required by Art. 263 (c) was filed by NFL prior to the strike on January 25 and 26. No prior notice of the taking of a strike vote was furnished the NCMB, nor was the seven-day strike ban after the strike vote observed. Instead, the workers immediately barricaded company premises in the afternoon of January 25, 1996, completely disregarding the procedural steps prescribed by Art. 263 (c) and (f). As for the strike commenced on February 11, only six days had elapsed from the filing of the Notice to Strike on February 5, 1993. In addition, various illegal acts were committed by the strikers during said strike. It can be gleaned from the record that the strikers destroyed company property and intimidated and harassed non-striking workers in violation of Art. 264 (e) of the Labor Code. Likewise, barricading, chaining and padlocking of gates to prevent free ingress and egress into company premises are also violations of the selfsame article. [8]

Arguing that despite its failure to comply with the statutory requirements necessary for a valid strike, NFL asserts that the same can be declared legal for it was done in good faith, citing the cases of Peoples Industrial and Commercial Employees and Workers Organization (FFW) v. Peoples Industrial and Commercial Corp. and Philippine Metal Foundaries, Inc. v. Court of Industrial Relations. The reliance is misplaced. Peoples Industrial did not rule that the procedural steps can be dispensed with even if the union believed in good faith that the company was committing an unfair labor practice. While, it is true that Philippine Metal held that a strike cannot be declared as illegal for lack of notice, however, it is important to note that said case was decided in 1979. At this juncture, it must be stressed that with the enactment of Republic Act No. 6715 which took effect on March 21, 1989, the rule now is that such requirements as filing of a notice of strike, strike vote, and notice given to the Department of Labor are mandatory in nature. [9]

[10]

[11]

[12]

Thus, even if the union acted in good faith in the belief that the company was committing an unfair labor practice, if no notice of strike and a strike vote were conducted, the said strike is illegal. [13]

Second, it is alleged that the dismissal of the 141 workers is based solely on a prima facie finding that they committed various unlawful acts while staging their strike, as certified by the City Prosecutors Office. This allegation is not true. The dismissal is principally based on their refusal to return to work

after the Secretary of Labor had assumed jurisdiction over the case on March 11, 1993. In fact, despite the efforts of PNP personnel through the District Commander to persuade the workers to comply with the Return-to-Work Order, the strike continued until March 29, 1993 when the workers dismantled their pickets. As held in St. Scholasticas College v. Hon Ruben Torres and Samahan ng Manggagawang Pang-edukasyon sa Sta. Escolastika (a) strike undertaken despite the issuance by the Secreatry of Labor of an assumption or certification order becomes a prohibited activity and thus illegal, pursuant to the second paragraph of art. 264 of the Labor Code, as amended x x x The union officers and members, as a result, are deemed to have lost their employment status for having knowingly participated in an illegal act. Case law, likewise, provides that by staging a strike after the assumption or certification for arbitration, the workers forfeited their right to be readmitted to work, having abandoned their employment. [14]

[15]

NFL claims that its refusal to follow the return to work order issued by the Secretary of labor was justified, since Permex was imposing certain conditions before admitting them back to work, citing the contents of a prepared form executed by Permex. [16]

[17]

This claim lacks merit. Contrary to NFLs contention, it is quite obvious that the form was dated January 27, 1993, which was prior to the return-to-work order issued by the Secretary of Labor on March 11, 1993; thus, NFLs refusal has no factual basis. To salvage its position, NFL asserts that Permex issued the same memorandum even after the Secreatry of labor had issued the return-to-work order, but in its lengthy (eighty-eight pages) petition, no copy of the said memorandum was attached when it could have easily done so. Hence, NFLs reason in refusing to comply with the return-to-work order is nothing but a bare assertion, unsupported by any evidence on record. [18]

Finally, as to the amount of damages awarded, respondent company submitted mere certifications by company officials that P300,000.00 worth of cooked fish were spoiled during the January 25-26 strike and that the respondent company lost about $3,431,630.00 in US commitments due to the paralyzation of company operations brought about by the February 11-March 29 strike. The same were found by the Labor Arbiter to be self-serving and no probative value; hence it only awarded moral and exemplary damages. The NLRC, on the other hand, deleted the award of moral and exemplary damages but awarded compensatory damages of P300,000.00, justifying the same in this wise: The compensatory damages assessed upon NFL is more than justified. PERMEX has sustained huge damages and losses as a consequence of the illegal strike staged by

NFL and its affiliate workers under the able direction of the union leadership. While it may be true that the NFL under Amado Magbanua and National President Ibbarra Malonzo has appeared to have tried to diffuse and resolve the dispute, its intercession obviously came after so much has been done upon the company. [19]

It is only too clear that the damages awarded are not based on concrete proof. This Court has ruled that (i)n order that damages may be recovered, the best evidence obtainable by the injured party must be presented. Actual or compensatory damages cannot be presumed, but must be duly proved, and so proved with reasonable degree of certainty. A court cannot rely on speculation, conjecture or guesswork as to the fact and amount of damages, but must depend upon competent proof that they have been suffered and on evidence of the actual amount thereof. If the proof is flimsy and insubstantial, no damages will be awarded. [20]

However, the strike dragged on for nearly 50 days, paralyzing respondents operations; thus, there is no room for doubt that some species of injury was caused to private respondent. In the absence of competent proof on the actual damages suffered, private respondent is entitled to nominal damages which, as the law says, is adjudicated in order that a right of the plaintiff, which has been violated or invaded by the defendant, may be vindicated and recognized, and not for the purpose of indemnifying the plaintiff for any loss suffered." We consider the amount of P300,00.00 just and reasonable under the circumstances. [21]

In view of the foregoing, we do not find any grave abuse of discretion on the part of the NLRC in rendering the assailed decision. WHEREFORE, the petition is DISMISSED for lack of merit. SO ORDERED.

S. [G.R. No. 153664. July 18, 2003]

GRAND BOULEVARD HOTEL (formerly known as SILAHIS INTERNATIONAL HOTEL, INC.), petitioner, vs. GENUINE LABOR ORGANIZATION OF WORKERS IN HOTEL, RESTAURANT AND ALLIED INDUSTRIES (GLOWHRAIN),respondent.

[G.R. No. 153665. July 18, 2003]

GRAND BOULEVARD HOTEL (formerly known as SILAHIS INTERNATIONAL HOTEL, INC.), petitioner, vs. EDNA B. DACANAY, respondent. DECISION CALLEJO, SR., J.:

Before us is a petition for review on certiorari of the Decision of the Court of Appeals in CA-G.R. SP Nos. 53284 & 53285 dated January 9, 2002and its Resolution dated May 27, 2002 denying the petitioners motion for reconsideration of the said decision. [1]

[2]

The Antecedents On February 27, 1987, Genuine Labor Organization of Workers in Hotel, Restaurant and Allied Industries Silahis International Hotel Chapter (GLOWHRAIN-Silahis) (respondent union for brevity) and the petitioner Grand Boulevard Hotel (then Silahis International Hotel, Inc.) executed a Collective Bargaining Agreement (CBA) covering the period from July 10, 1985 up to July 9, 1988. The petitioner thereafter dismissed some of its employees and suspended others who were members of the respondent union. On May 26, 1987, the respondent union filed a notice of strike with the Department of Labor and Employment, National Capital Region (DOLE-NCR), based on the following grounds: a) Illegal dismissal b) Illegal suspension c) CBA violations d) Harassments [3]

On June 4, 1987, the then Acting Secretary of Labor and Employment (SOLE for brevity) issued a status quo ante bellum order certifying the labor dispute to the National Labor Relations Commission (NLRC) for compulsory arbitration pursuant to Article 263(g) of the Labor Code; and further directing the employees to return to work within forty-eight hours from receipt of the order, and for the petitioner to accept all returning employees under the same terms and conditions prevailing prior to the labor dispute. The respondent union complied with the order of the SOLE. On May 9, 1990, the respondent union filed another notice of strike against the petitioner on account of alleged [4]

violations of the CBA and the illegal dismissal of nine employees. The matter was docketed as NCMB-NCR-Case No. 06-400-90. On May 23, 1990, the SOLE issued another status quo ante bellumorder certifying the case to the NLRC for compulsory arbitration, directing the nine employees to return to work and enjoining both parties from engaging in any strike or lockout that would exacerbate the situation. The parties were also directed to sign a CBA within fifteen days from notice of the said order. [5]

On June 15, 1990, the petitioner and the respondent union entered into and signed a third CBA covering the period of July 10, 1988 to July 9, 1991. On August 22, 1990, Union President Rogelio Soluta wrote the petitioner, calling its attention to and protesting the following violations of the CBA: 1. Union dues and other assessments deducted from CBU and union members salary for July 15, 1990 payday. 2. Union dues and other assessments deducted from CBU and union members salary for July 31, 1990 payday. 3. Union dues and other assessments deducted from CBU and union members salary for August 15, 1990 payday. [6]

On September 6, 1990, the petitioner placed the respondent unions Director for Grievances Apolonio Bondoc, Jr. under preventive suspension.On September 13, 1990, the respondent union filed a manifestation and motion in NCMB-NCR-NS Case No. 06-400-90 praying that the petitioner be held in contempt for violating the May 23, 1990 Order of the SOLE. On September 22, 1990, the petitioner suspended Francisco Pineda, a union counselor. On September 27, 1990, the respondent union filed a notice of strike based on the following grounds: a. Violation of CBA; b. Coercion of employees; c. Harassment; d. Arbitrary transfer of employees; and e. Illegal termination and suspension of employees

[7]

The matter was docketed as NCMB-NCR-NS-09-807-90. On October 10, 1990, the respondent union moved that the SOLE reconsider the May 23, 1990 Return-to-Work Order.

On October 16, 1990, Michael Wilson, the petitioners general manager, wrote the SOLE informing him of the petitioners decision to retrench seventeen less senior employees on a staggered basis, spread over a period of sixty days, to lessen the daily financial losses being incurred by the petitioner. A portion of the letter reads: Due to the present continued downturn in tourism, we at the Silahis International Hotel are about to undertake a retrenchment program. As you know the other hotels have also invoked this management prerogative in order to lessen their financial losses incurred these last few months. Due to our unique situation/relationship with the KMU, I am writing to you and appealing to your good sense of fair play on case of problems arising from unruly elements. We plan to retrench on a staggered basis one hundred seventy-one (171) less senior employees over a period of sixty (60) days, in order to stem the huge losses being incurred by us daily, during this unfortunate period. Therefore, on behalf of my staff we ask fairness in this situation and hope the above actions can be taken smoothly and peacefully. [8]

The next day, the respondent union, through its president, informed the DOLE-NCR that the union will conduct a strike vote referendum on October 23 and 24, 1990. The members of the respondent union voted to stage a strike. On October 25, 1990, the respondent union informed the DOLE-NCR of the results of the strike vote referendum. On October 31, 1990, the SOLE issued another status quo ante bellum order certifying the case to the NLRC for compulsory arbitration and enjoining the parties from engaging in any strike or lockout. The decretal portion of the order reads: WHEREFORE, ABOVE PREMISES CONSIDERED, this Office hereby certifies the labor disputes at Silahis International Hotel, Inc., to the National Labor Relations Commission for compulsory arbitration. Accordingly, any strike or lockout, whether actual or intended, is hereby enjoined. Consequently, pending resolution of the legality of the alleged dismissal of Apolonio Bondoc, Jr., the Company is directed to effect payroll reinstatement and accord him free access to the union office so that his duties as union officer will not be impaired.

[9]

The petitioner wrote the SOLE of its decision to implement its retrenchment program to stem its huge losses. On November 5, 1990, the petitioner disseminated a circular to all the employees, informing them that the personnel plantilla would be decreased by two hundred employees to be

implemented on a staggered and last in, first out basis. It terminated the employment of sixty employees and two officers of the respondent union effective December 6, 1990. Moreover, the said employees, including the two union officers, were immediately barred from working. On November 7, 1990, the respondent union protested the actions of the petitioner invoking Section 15, Article VI of the CBA. The respondent union filed an urgent motion for a reconsideration by the SOLE of the Certification Order dated October 31, 1990. On November 14, 1990, the petitioner terminated the employment of eighty-six more employees effective December 14, 1990. The remaining employees were also informed that it will close in six months.On November 14, 1990, the petitioner terminated the employment of Kristoffer So, effective December 14, 1990. By way of riposte, the respondent union filed on November 16, 1990 another notice of strike because of what it perceived as the petitioners continuing unfair labor practices (ULP). On the same day, at about 12:00 noon, the officers of the respondent union and some members staged a picket in the premises of the hotel, obstructing the free ingress and egress thereto. At 3:00 p.m., the police operatives of the Western Police District arrived and dispersed the picket line. Police officers detained the respondent unions president Rogelio Soluta, Henry Baybay and Dennis Cosico. On November 17, 1990, the petitioner sent identical letters to the officers and members of the respondent union terminating their employment effective that day on the following grounds: Management found that you have willingly and knowingly participated in the illegal strike and concerted activity which was staged against the Hotel beginning on 16 November 1990. Management also found that you have, singly and collectively with others, committed illegal acts in the course of the said illegal strike such as, among others, obstructing the free ingress and egress to and from the hotels premises. In addition, Management has determined that you have grossly and glaringly violated existing company rules on peace and order such as, Rule V, and on promotion of goodwill such as Rule IV of the Company Rules. Worse, you have violated the Company Rule against abandonment of work under Rule VII, thus, adversely affecting the hotel operations. Your foregoing acts are not only serious violations of the law but also constitute grave misconduct and blatant disregard of company rules, any or all of which, justify your dismissal from the company.

In view of the foregoing, notice is hereby given upon you that effective today, 17 November 1990, your employment with the company is terminated for cause. [10]

On November 28, 1990, the SOLE issued an order certifying the labor dispute to the NLRC for consolidation with the previously certified case (Certified Case No. NCMB-NCR-NS-09-807-90). The SOLE issued a returnto-work order, excluding those who were retrenched, and enjoined all parties from committing any act that would aggravate the already tense situation. The SOLE further stated that the validity and propriety of the retrenchment program of the petitioner should be ventilated before and resolved by the NLRC. The SOLE denied the respondent unions motion to reconsider its October 31, 1990 Cease and Desist Order, thus: WHEREFORE, PREMISES CONSIDERED, and pursuant to Article 263 (g) of the Labor Code, as amended, this Office hereby certifies the instant labor dispute at the Company to the National Labor Relations Commission for consolidation with Certified Case No. NCMB-NCR-NS-09-807-90. Accordingly, all striking employees including those who were terminated for participation in the alleged illegal strike, but excluding those workers affected by the retrenchment program, are directed to return to work within twenty-four (24) hours from receipt hereof and for the Company to accept them under the same terms and conditions of employment prevailing prior to the work stoppage. The validity and propriety of the Companys retrenchment program shall be ventilated and adjudicated by the NLRC. The directive for the parties to cease and desist from committing any act that will aggravate the situation is hereby reiterated. The unions Motion for Reconsideration is hereby denied. Finally, the Superintendent of the Western Police District is hereby deputized to assist in the orderly and peaceful implementation of this Order. [11]

In his order, the SOLE made the succinct observation that both the petitioner and the respondent union were to blame for the current labor conflict: From the series of events that occurred from the time this Office issued the Order on 31 October 1990 up to the declaration of the strike, it is very apparent that several acts were committed by both parties that caused the further deterioration of their

relationship despite this Offices admonition to desist from engaging in ay (sic) form of lockout or strike, whether actual or intended. Likewise, it is also very obvious that the current labor conflict is deeply rooted in an (sic) intertwined with the earlier dispute on account of the nature of the acts committed by both parties. Unfair labor practices, by its nature, could be committed through series of continuing acts, and allegations of commission of unfair labor practice acts should be ventilated in the forum earlier tasked to resolve the dispute at the Company. [12]

The respondent officers and members complied with the order of the SOLE and returned to work. On January 15, 1991, the SOLE issued an order for the reinstatement of the thirty-five dismissed employees with full backwages. On February 1, 1991, the petitioner filed a complaint with the Regional Arbitration Office of the NLRC for illegal strike against the union, its members and officers, namely: Rogelio M. Soluta, Elmer C. Labor, Joselito A. Santos, Florentino P. Matilla, Edna B. Dacanay, Henry N. Babay, Ray Antonio E. Rosaura, Dennis C. Cosico, Vicente M. Delola, Irene B. Ragay, Apolonio Bondoc, Jr., Quintos B. Barra, Alfredo S. Bautista, Richard T. Galigo, John Does and Jane Does. The petitioner alleged inter alia that the union members and officers staged a strike on November 16, 1990 which lasted until November 29, 1990 without complying with the requirements provided under Articles 263 and 264 of the Labor Code. The petitioner alleged inter alia that: [13]

1. The strike staged by the respondents from 16 to 29 November 1990 is illegal for failure of the strikers to comply with the requirements provided for by law; 2. Individual respondents who are the union officers and respondent John Does and Jane Does knowingly participated in the commission of illegal acts during the strike; 3. As a consequence of the illegal strike and concerted activities by the respondents the company suffered actual damages; and 4. Complainant Hotel was constrained to engage the services of counsel and, therefore, should be paid attorneys fees. [14]

It further alleged that the officers and members of the respondent union blocked the main ingress to and egress from the hotel. The petitioner prayed that, after due proceedings, judgment be rendered in its favor declaring the strike staged by the respondent union illegal, that it be

awarded damages, and that the officers and members of the union who participated in the strike be dismissed from their employment. The respondents denied the material allegations of the complaint and alleged that the petitioner committed unfair labor practices prior to the filing of the November 16, 1990 notice of strike. Hence, there was no need for the respondent union to comply with Articles 263 and 264 of the Labor Code, as the notice filed by the union on September 27, 1990 was sufficient compliance with the law. The view posited by the respondent union was summarized by its president Rogelio M. Soluta in his affidavit: a. after the execution of the CBA on June 15, 1990 he wrote on August 22, 1990 the company protesting its violations [Exh. 8]; b. on September 13, 1990 their union wrote the Secretary of Labor and Employment praying that the company be cited in contempt for violation of his May 23, 1990 order [Exh. 10] which enjoined the parties from engaging in strike or lockout [Exh. 7]. c. on September 27, 1990 the union filed a notice of strike on grounds of unfair labor practices as enumerated in par. 19 of Solutas affidavit, acting on which the Secretary of Labor certified the labor dispute to the NLRC for compulsory arbitration and enjoining any strike or lockout again [Exh. 16]. In violation of said order, the company on November 5, 1990 issued a circular to all employees that it will decrease its personnel plantilla by 200 employees [Exh. 17] and on November 6, 1990 it again issued a memorandum terminating 60 employees including 2 union officers, while effective still December 6, 1990 were not allowed to work already on November 6, 1990, to which the union on November 7, 1990 protested invoking Sec. 15, Art. VI, 2nd par. of the CBA, only to be confirmed by the Hotel in a letter that it will undertake a retrenchment of 200 employees [Exh. 19]. Union president Soluta sought for a dialogue with the management but he was only insulted and rebuffed by the Hotel when it issued a memorandum terminating 86 employees effective December 14, 1990 [Exh. 20] and not satisfied, the Hotels Executive Vice-President issued a memorandum to all department heads that the Hotel will close for a period of six months. [Exh. 21] (Emphasis ours, Record, pp. 396-397) [15]

The respondent union and its officers filed on October 14, 1991 a motion to suspend the proceedings, alleging inter alia that: 8. In the determination of the validity or legality of a strike, three (3) essential factors are to consider: a) The purpose or objective of the strike;

b) The means employed; c) Compliance with the requirements of the law provided for under Article 263 of the Labor Code of the Philippines, as amended. [16]

On February 12, 1992, Labor Arbiter Cornelio L. Linsangan rendered a decision in favor of the petitioner, the decretal portion of which reads: WHEREFORE, finding the respondents guilty of illegal strike as charged, judgment is hereby rendered declaring the union officers to have lost and forfeited their employment. [17]

The Labor Arbiter, although sympathetic with the respondent union, held that for the latters failure to comply with the requirements laid down in Articles 263 and 264 of the Labor Code, the strike that was staged on November 16, 1990 up to November 29, 1990 was illegal. Considering the admissions of the individual respondents that they participated in the said strike, the termination of their employment by the petitioner was legal. The Labor Arbiter noted that if as alleged by the respondent union the petitioner was guilty of ULP, it should have filed a complaint therefor against the petitioner and/or its officials for which the latter could have been meted penal and administrative sanctions as provided for in Article 272 of the Labor Code. The respondent union failed to do so. When the petitioner learned of the decision of the Labor Arbiter on February 14, 1992, it forthwith barred the officers and members of the respondent union from entering the hotel. On February 22, 1992, the SOLE ordered the petitioner to accept the dismissed officers and employees, but the petitioner refused. On February 27, 1992, the officers of the union filed a very urgent petition for the issuance of a writ of preliminary injunction against the petitioner under Article 218 (e) of the Labor Code. On March 11, 1992, the NLRC issued a minute resolution in favor of the officers/employees ordering the petitioner to reinstate them. The petitioner filed a motion for reconsideration of the said resolution but the said motion was denied. The petitioner forthwith filed with this Court on March 11, 1992 a petition for certiorari and prohibition against the respondent union and its officers for the nullification of the said resolution. [18]

In the meantime, the respondent union and the individual respondents therein interposed an appeal from the decision of the Labor Arbiter to the NLRC. The respondent union pointed out in its appeal that it had complied with the requirements laid down in Articles 263 and 264 of the Labor Code because its November 16, 1990 notice of strike was a mere reiteration of its

September 27, 1990 notice of strike, which, in turn, complied with all the requirements of the aforementioned articles, i.e., the cooling-off period, the strike ban, the strike vote and the strike vote report: 9. As above shown it is not disputed that the union filed a notice of strike on September 27, 1990 [Exh. 12]; par. 5 (c) and for this purpose, the union conducted a strike vote referendum and informed the Department of Labor of the result of the strike vote, acting on which said office issued its order of October 31, 1990 certifying the labor dispute to the Honorable Commission for compulsory arbitration and enjoining the parties from going on strike lockout [same par.; Exh. 16]. But then despite said order the Hotel intended to decrease its plantilla by 200 employees [Exh. 17]; terminated 60 employees, including 2 union officers, despite the vehement protests from the union; also terminating on November 14, 1990 86 employees effective December 14, 1990 [Exh. 20] and to put fear upon the union members, circularized that the Hotel will close for a period of six months. So at this point in time, November 14, 1990 their notice of strike of September 27, 1990 [Exh. 12] has not been withdrawn nor resolved one way or another such that notice continued then as a warning that anyday (sic) after the 15-day cooling-off period a strike impends (Morabe, The Law on Strikes, 1962 First Ed. p. 187) as it happened on November 16, 1990. The notice of strike filed on this date is a mere reiteration of that earlier notice of strike of September 27, 1990. Thus Union President Soluta declared in his affidavit: 36. The requirements of the law relative to the Notice of Strike filed on September 27, 1990 having been complied with, the union declared a strike against the company on November 16, 1990 based on grounds stated in the Notice of Strike filed on September 27, 1990. [19]

On August 4, 1993, this Court rendered a Decision in G.R. No. 104513 granting the petition and annulling the Resolution of the NLRC dated March 11, 1992. [20]

Shortly thereafter, on September 30, 1993, the NLRC rendered a decision affirming the decision of the labor arbiter, the decretal portion of which reads: WHEREFORE, the respondents appeal is hereby dismissed. The complainant Hotel is however urged, on humanitarian consideration, to pay the respondents a financial assistance computed at one month pay for every year of service. [21]

The NLRC ratiocinated that the compliance by therein respondents of the requirements laid down in Articles 263 and 264 of the Labor Code respecting the September 27, 1990 notice of strike filed by the union cannot be carried

over to the November 16, 1990 notice of strike. Resultantly, for failure of the union to comply with the aforementioned requirements for its November 16, 1990 notice of strike, the strike staged on November 16 up to November 29, 1990 was illegal. The NLRC likewise cited the ruling of this Court in Union of Filipino Employees v. Nestle Philippines, Inc. However, the NLRC appealed to the petitioner to grant separation pay to the members/officers of the respondent union who joined the strike in this language: [22]

This notwithstanding, we have deliberated on the question of whether or not the complainants should receive financial assistance. And while we are unanimously inclined to grant all the respondents separation pay equivalent to one month for every year of service, we however are so intimidated by the ruling of the Supreme Court in the case of Benito D. Chua v. NLRC (G.R. No. 105775, February 8, 1993, 2 nd Div., Feliciano, J.) where, despite the companys willingness to pay financial assistance to complainant who was found guilty of participating in an illegal strike at Nestle Philippines, the Supreme Court deleted the NLRCs award thereon. And, taking cue from the Supreme Court ruling that the company is not precluded from making a grant on a voluntary ex gratia basis (but not through an award from this Commission) we appeal to the complainant company that such a financial assistance, for humanitarian reasons, be extended all the respondents whose dismissals are hereby affirmed. [23]

The respondents filed a motion for reconsideration of the decision but the NLRC issued an Order dated November 16, 1994 denying the same. [24]

Dissatisfied, the respondents filed a petition for certiorari under Rule 65 before this Court docketed as G.R. No. 153664. Edna Dacanay, another officer of the union, filed a similar petition before this Court docketed as G.R. No. 153665. Upon motion of the petitioner, the petitions were consolidated. Pursuant to the ruling of this Court in St. Martin Funeral Homes v. NLRC, the petitions were remanded to the Court of Appeals (CA) and redocketed as CA-G.R. SP No. 53284 and CA-G.R. SP No. 53285, respectively. On January 9, 2002, the CA rendered a decision giving due course to and granting the petitions; and ordering the remand of the case to the labor arbiter for the determination of backwages due to the respondent officers under the said decision. The decretal portion of the decision reads: [25]

WHEREFORE, premises considered, the instant petitions for certiorari are hereby GIVEN DUE COURSE and GRANTED. Consequently, the subject strike being LEGAL under the prevailing circumstances then the DISMISSALS which ensued by virtue of the assailed Decisions of Arbiter

Linsangan and respondent NLRC are UNJUSTIFIED and WITHOUT LEGAL BASIS. Resultantly, the dismissed petitioners are entitled to reinstatement, if this is feasible, otherwise to separation pay and backwages plus disturbance compensation of P10,000.00 each, moral damages of P50,000.00 each and exemplary damages of another P10,000.00 each. On the strength of the Supreme Court ruling in Serrano vs. NLRC, et al. (G.R. No. 117040, January 27, 2000), except for the backwages and the separation pays which would be determined by the LABOR ARBITER, the Grand Boulevard Hotel, formerly known as Silahis International Hotel, Inc., is ORDERED to pay immediately the disturbance compensation, moral and exemplary damages. Upon finality hereof, lest it be forgotten that justice delayed is justice denied, the subject petitions should be REMANDED with dispatch to the Labor Arbiter for immediate computation and payment of backwages and separation pay due to petitioners. [26]

In reversing the decisions of the NLRC and the Labor Arbiter, the CA took into account the observation of the Solicitor General that the petitioner (Silahis) retrenched employees pending the resolution of the certified cases respecting the alleged illegal suspension and dismissals effected by the petitioner during and prior to the notices of strike filed by the union. The Solicitor General opined that even if the strike was staged without the proper notice and compliance with the cooling-off period, resort thereto was simply triggered by the petitioners belief in good faith that respondent Silahis was engaged in ULP. The CA cited the Order of the SOLE dated November 28, 1990 and the rulings of this Court in Bacus v. Ople; Bisig ng Manggagawa Sa Concrete Aggregates, Inc. v. NLRC; and Silahis International Hotel, Inc. v. NLRC. [27]

[28]

[29]

[30]

Dissatisfied, the petitioner filed a motion for reconsideration of the said decision. On May 27, 2002, the CA issued a resolution denying the said motion. [31]

In its petition at bar, the petitioner assails the decision and resolution of the CA and prays for the reversal thereof, contending that: I. The findings of fact of the Court of Appeals, particularly those with respect to the unfair labor practice of petitioner Hotel were not supported by the real facts and circumstances attendant to the instant case.

II. The Court of Appeals finding of legality of the unions strike was a clear disregard of the requirements for a legal and valid strike as prescribed by law and jurisprudence. [32]

Private respondent Dacanay, in her comment on the petition in G.R. No. 153665, alleges that the retrenchment program of the petitioner was without basis. The strike staged by the respondent union was sanctioned by its officers, and was not a wildcat strike. The requirements provided for in Articles 263 and 264 of the Labor Code had been complied with; the issues posed by the petitioner are factual; hence, not proper in a court petition.The petition should thus be dismissed and the decision of the CA affirmed. The respondent union, for its part, argues that the strike staged on November 16, 1990 was lawful, considering the unfounded and illegal retrenchment undertaken by the petitioner and the unfair labor practices committed by the petitioner during the pendency of the resolution of the certification cases. The petitioner failed to show that the CA committed a grave abuse of its discretion amounting to excess or lack of jurisdiction in reversing the decisions of the Labor Arbiter and NLRC. The respondent union likewise expostulated that the certificate of nonforum shopping embedded in the petition is defective because Jose Ma. Nuez, who executed the certification, was not authorized by board resolution to specifically file the instant petition. The private respondent likewise asserted that the petition should not be given due course for failure of the petitioner to attach copies of relevant pleadings filed by the parties before the Labor Arbiter and the NLRC. The issues submitted for resolution are two-fold, namely: (1) PROCEDURAL, to wit: (a) whether or not the certificate of non-forum shopping is defective, and (b) whether or not the petition is insufficient in form for failure of the petitioner to attach relevant pleadings that form part of the decision; and (2) SUBSTANTIVE, to wit: (a) whether or not the strike staged by the respondent union on November 16 up to 29, 1990 is legal, and (b) whether or not the dismissals of the private respondents officers of the respondent union as a consequence of the strike on November 16 to 29, 1990 are valid. On the Procedural Issues The respondents (except respondent Edna Dacanay) aver that the certification of non-forum shopping embedded in the resolution of the Board of Directors failed to specifically authorize Jose Ma. Nuez to file the petition at bar for and in behalf of the petitioner. A reading of the comment of the said

respondents reveals that they do not assail the sufficiency of the certification of non-forum shopping submitted by the petitioner; rather, they aver that the resolution of the Board of Directors of the petitioner appended to the petition does not specifically authorize Jose Ma. Nuez to file the petition at bar for and in its behalf. We do not agree. The resolution adverted to by the respondents reads: RESOLVED, That the Board of Directors of Grand Boulevard Hotel hereby authorize Mr. Jose Ma. Nuez to do any and all of the following acts: 1. to cause the filing of the proper legal actions, cases, proceedings in the appropriate court; 2. to represent the Corporation in any capacity in all suits of whatever kind and nature brought for or against it and empowering him to engage the services of counsel as it deems fit; and 3. to sign for and verify as well as authenticate such petition, pleadings, documents, record and other papers necessary in the successful prosecution of such suits, including the verification of such petitions and pleadings. [33]

There is no doubt that the resolution of the Board of Directors is broad enough as to authorize Jose Ma. Nuez to file the petition at bar for and in behalf of the petitioner. Likewise, barren of merit is the respondents contention that the petition at bar should be denied due course for failure of the petitioner to append to its petition copies of pleadings, such as petitions, complaint, answer, resolutions, orders, and decisions filed with the Labor Arbiter, the NLRC and the CA as required by Section 4, Rule 45 of the Revised Rules of Court. What the rule merely requires is for the petition to be accompanied by a clearly legible and duplicate original or a certified true copy of the judgment or final order or resolution of the court a quo and the requisite number of plain copies thereof and such material portions of the record as would support the petition. The said rule does not require the petitioner to append copies of all pleadings and decisions filed by the parties with the Labor Arbiter, the NLRC and the CA. After all, under Section 7 of the Rule, the Court may require the parties to file pleadings or other documents as the Court deems necessary, and if the petition is given due course, the Court may require the elevation of a complete record of the case as provided for under Section 8 of the Rule. On the Substantive Issues The petitioner contends that the CA erred in its ruling that the petitioner committed (ULP) and acted oppressively against the respondents; and in concluding that the strike staged by the respondents on November 16, 1990 up to November 29, 1990 was legal, and the termination of employment of the respondents officers unlawful. The CA likewise erred in finding that even if the

strike staged by the respondents on November 16 to 29, 1990 was defective, the same was cured when they staged the strike in good faith in the light of the oppressive and unfair labor practices of the petitioner. A striker cannot invoke good faith where assumption orders of the SOLE, which operate as an injunction against a prospective strike, are disregarded. The respondents failed to prove that the petitioner had committed any ULP on the respondents and its employees. The testimony of respondent Rogelio Soluta and the other officers of the respondent union before the Labor Arbiter did not constitute sufficient proof of ULP. If the respondents perceived that the petitioner committed ULP, the matter should have been threshed out with the appropriate labor tribunal (NLRC or CA).Instead, the respondents staged a strike. Thus, the retrenchment by the petitioner of its employees was within its prerogative and was necessitated byThe years 1989 and 1990 were particularly harsh to petitioner Hotel. Serious financial reverses were brought about by the increase in operational costs and a marked decline in its room occupancy rate. It was also at this time that petitioner Hotels business was threatened by the emergence of more modern and refurbished hotels in Metro Manila. It was in order to forestall the imminent threat of a partial or a total closure of the business that petitioner Hotel, after a thorough study and review of its corporate structure and financial set-up, decided to implement the retrenchment program. Certainly, the employees were not unaware of this situation. [34]

The respondents assert that the issues posed by the petitioner in its petition at bar involve questions of facts which are improper in a petition for review on certiorari under Rule 45 of the Revised Rules of Court. Under the said Rule, questions of facts should not be raised in a petition for review.However, this rule admits of exceptions, such as where the findings of facts of the Labor Arbiter and the NLRC and those of the CA are contradictory; when the conclusions of the CA are based on speculations, surmises and conjectures; where the judgment of the CA is premised on misapprehension of facts; or when the CA failed to take into account and consider facts which if properly considered would justify a different conclusion. The CA did not commit any error in ruling that the petitioner was guilty of ULP when it dismissed all the officers of the respondent union despite the certificate orders of the SOLE and in defiance of the said orders; and the respondents believed in good faith that indeed the petitioner committed ULP which belief cured whatever defects there may have been in the November 16 to 29, 1990 strike staged by the respondents. The findings of the CA, and its

conclusions anchored on the said findings are supported by the evidence on record, thus: In the case at bar, petitioners staged the strike because of alleged unfair labor practices committed by respondent Silahis, to wit, termination of two hundred (200) employees in the guise of retrenchment program, despite the certification order of then Secretary Ruben Torres (Order dated October 31, 1990) enjoining a strike lockout. However, the Labor Arbiter and the respondent NLRC did not rule on petitioners claim of unfair labor practices committed by respondent Silahis but merely declared the strike illegal for not complying with the required notice and cooling-off period and the certification order. But whether or not the retrenchment program was valid or not, is not material in this case. The issue is whether or not there was warranted belief in good faith on the part of petitioners that respondent Silahis was then committing acts of unfair labor practices. It is established on record that on September 27, 1990, petitioner Union filed a notice of strike against respondent Silahis for harassment, arbitrary transfer of employees and illegal dismissal and suspension. Subsequently, respondent Silahis informed the Office of the Secretary of its plan to retrench on a staggered basis one hundred seventy-one (171) least senior employees over a period of sixty (60) days. On October 31, 1990, the Secretary certified the issues to the NLRC for compulsory arbitration. The Order likewise enjoined any strike or lockout, whether actual or intended. On November 6, 1990, petitioner Union filed an Urgent Motion for Reconsideration objecting to the certification order. On even date, respondent Silahis informed the Secretary about its decision to implement the retrenchment program as previously stated. On account of this action of respondent Silahis terminating the services of some union officers and members, petitioner union immediately filed a notice of strike on November 16, 1990 and on the same day stated an actual strike (which strike lasted up to November 29, 1990). On November 23, 1990, respondent Silahis further effected the retrenchment of one hundred ten (110) employees allegedly due to financial reverses and seventy-two (72) additional workers due to their participation in the strike. [35]

According to the respondents, the petitioner enforced its retrenchment program at a time when there was an ongoing dispute between the petitioner and the respondent union regarding the dismissal and suspension of employees. This engendered an honest belief on the part of the respondents that the petitioner was indeed committing ULP which impelled them to stage a strike to protect their basic rights.

The petition is meritorious. The relevant provision of Article 263 of the Labor Code reads: Article 263. (c). In cases of bargaining deadlocks, the duly certified or recognized bargaining agent may file a notice of strike or the employer may file a notice of lockout with the Ministry at least 30 days before the intended date thereof. In cases of unfair labor practice, the period of notice shall be 15 days and in the absence of a duly certified or recognized bargaining agent, the notice of strike may be filed by any legitimate labor organization in behalf of its members. However, in case of dismissal from employment of union officers duly elected in accordance with the union constitution and by-laws, which may constitute union busting where the existence of the union is threatened, the 15-day cooling-off period shall not apply and the union may take action immediately. (f) A decision to declare a strike must be approved by a majority of the total union membership in the bargaining unit concerned, obtained by secret ballot in meetings or referenda called for that purpose. A decision to declare a lockout must be approved by a majority of the board of directors of the corporation or association or of the partners in a partnership, obtained by secret ballot in a meeting called for the purpose. The decision shall be valid for the duration of the dispute based on substantially the same grounds considered when the strike or lockout vote was taken. The Department may at its own initiative or upon the request of any affected party, supervise the conduct of the secret balloting. In every case, the union or the employer shall furnish the Ministry the voting at least seven days before the intended strike or lock-out, subject to the cooling-off period herein provided. [36]

Under the aforequoted provisions, the requisites for a valid strike are as follows: (a) a notice of strike filed with the DOLE thirty days before the intended date thereof or fifteen days in case of ULP; (b) strike vote approved by a majority of the total union membership in the bargaining unit concerned obtained by secret ballot in a meeting called for that purpose; (c) notice given to the DOLE of the results of the voting at least seven days before the intended strike. The requisite seven-day period is intended to give the DOLE an opportunity to verify whether the projected strike really carries the approval of the majority of the union members. The notice of strike and the cooling-off period were intended to provide an opportunity for mediation and conciliation. The requirements are mandatory and failure of a union to comply therewith renders the strike illegal. A strike simultaneously with or immediately after a notice of strike will render the requisite periods nugatory. [37]

[38]

Moreover, a strike that is undertaken, despite the issuance by the SOLE of an assumption or certification order, becomes a prohibited activity and, thus,

illegal pursuant to Article 264 of the Labor Code of the Philippines, as amended. As this Court ruled in Union of Filipro Employees v. Nestle Philippines, Inc., under Article 264(a) of the said code, once an assumption certification order is issued by the SOLE, strikes are enjoined or if one has already taken place, all strikers shall immediately return to work: [39]

We also wish to point out that an assumption and/or certification order of the Secretary of Labor automatically results in a return-to-work of all striking workers, whether or not a corresponding order has been issued by the Secretary of Labor. Thus, the striking workers erred when they continued with their strike alleging absence of a return-to-work order. Article 264(g) (sic) is clear. Once an assumption/certification order is issued, strikes are enjoined, or if one has already taken place, all strikers shall immediately return to work. A strike that is undertaken despite the issuance by the Secretary of Labor of an assumption or certification order becomes a prohibited activity and thus illegal, pursuant to the second paragraph of Art. 264 of the Labor Code as amended (Zamboanga Wood Products, Inc. v. NLRC, G.R. 82088, October 13, 1989; 178 SCRA 482). The Union officers and members, as a result, are deemed to have lost their employment status for having knowingly participated in an illegal act. [40]

In this case, the respondent union filed its notice of strike with the DOLE on November 16, 1990 and on the same day, staged a picket on the premises of the hotel, in violation of the law. Police operatives of the Western Police District had to disperse the picketers and take into custody Union President Rogelio Soluta and the other officers of respondent union, Henry Babay and Dennis Cosico. The respondents cannot argue that since the notice of strike on November 16, 1990 were for the same grounds as those contained in their notice of strike on September 27, 1990 which complied with the requirements of the law on the cooling-off period, strike ban, strike vote and strike vote report, the strike staged by them on November 16, 1990 was lawful. The matters contained in the notice of strike of September 27, 1990 had already been taken cognizance of by the SOLE when he issued on October 31, 1990 a status quo ante bellum order enjoining the respondent union from intending or staging a strike. Despite the SOLE order, the respondent union nevertheless staged a strike on November 16, 1990 simultaneously with its notice of strike, thus violating Article 264(a) of the Labor Code of the Philippines, as amended, which reads: Art. 264.

No strike or lockout shall be declared after assumption of jurisdiction by the President or the Secretary or after certification or submission of the dispute to compulsory or voluntary arbitration or during the pendency of cases involving the same grounds for the strike or lockout. While it may be true that the petitioner itself barred the officers of the respondent union from working and had terminated the employment of Kristoffer So, and sent out circulars of its decision to retrench its employees effective December 16, 1990, the same were not valid justifications for the respondents to do away with the statutory procedural requirements for a lawful strike. It behooved the respondents to avail themselves of the remedies under the CBA or file an illegal dismissal case in the office of the Labor Arbiter against the petitioner or by agreement of the parties, submit the case to the grievance machinery of the CBA so that the matter may be subjected to voluntary arbitrary proceedings instead of resorting to an immediate strike. There was no immediate and imperative need for the respondents to stage a strike on the very day that the notice of strike on November 16, 1990 was filed because the retrenchment envisaged by the petitioner had yet to take effect on December 14, 1990. The grievances of the respondent union could still very well be ordered and acted upon by the SOLE before December 14, 1990. [41]

The respondents claim of good faith is not a valid excuse to dispense with the procedural steps for a lawful strike. As this Court held in National Federation of Labor v. NLRC: [42]

Arguing that despite its failure to comply with the statutory requirements necessary for a valid strike, NFL asserts that the same can be declared legal for it was done in good faith, citing the cases of Peoples Industrial and Commercial Employees and Workers Organization (FFW) v. Peoples Industrial and Commercial Corp. and Philippine Metal Foundries, Inc. v. Court of Industrial Relations. The reliance is misplaced. Peoples Industrial did not rule that the procedural steps can be dispensed with even if the union believed in good faith that the company was committing an unfair labor practice. While, it is true that Philippine Metal held that a strike cannot be declared as illegal for lack of notice, however, it is important to note that said case was decided in 1979. At this juncture, it must be stressed that with the enactment of Republic Act No. 6715 which took effect on March 21, 1989, the rule now is that such requirements as the filing of a notice of strike, strike vote, and notice given to the Department of Labor are mandatory in nature.

Thus, even if the union acted in good faith in the belief that the company was committing an unfair labor practice, if no notice of strike and a strike vote were conducted, the said strike is illegal. In Lapanday Workers Union v. NLRC, we held that a strike is the most preeminent of the economic weapons of workers which they unsheathe to force management to agree to an equitable sharing of the joint product of labor and capital. But we also emphasized that strikes exert some disquieting effects not only on the relationship between labor and management, but also on the general peace and progress of society, not to mention the economic well-being of the State. It is a weapon that can either breathe life to or destroy the union and members in their struggle with management for a more equitable due of their labors. Hence, the decision to wield the weapon of strike must therefore rest on a rational basis, free from emotionalism, unswayed by the tempers and tantrums of a few hotheads, and firmly focused on the legitimate interest of the union which should not however be antithetical to the public welfare. In every strike staged by a union, the general peace and progress of society and public welfare are involved. Indeed, in his Order dated October 31, 1990, the SOLE stated: [43]

The Company is one of the biggest hotels in the country and contributes substantially to the tourism industry. It is recognized as one of the major sources of foreign exchange earnings of the country, housing a government-owned and controlled income generating agency financing vital development projects of the government.Clearly, the threatened work stoppage will result in huge financial losses not only to the hotel but likewise the country. The ongoing development projects of the government will be severely jeopardized and the economic recovery program of the government will be unduly hampered. Moreover, the security of employment of the more or less seven hundred (700) employees is in grave state not to mention other workers who are equally dependent on the continuous operations of the Company. These considerations have in the past guided this Office in consistently exercising its powers under Article 263(g) of the Labor Code, as amended, in addressing and handling labor disputes in the hotel industry. [44]

Hence, the need for a union to adhere to and comply strictly with the procedural conditions sine qua non provided for by the law in staging a strike. IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The Decision of the Court of Appeals in CA-G.R. SP No. 53284 and its Resolution in the same case Annex B of the petition are REVERSED AND SET ASIDE. The Decision of the Labor Arbiter is REINSTATED. [45]

[46]

Costs against the respondents. SO ORDERED.

T. [G.R. NOS. 143013-14. December 18, 2000]

TELEFUNKEN SEMICONDUCTORS EMPLOYEES UNION-FFW and individual union members DANILO G. MADARA and ROMEO L. MANAYAO, petitioners, vs., THE COURT OF APPEALS, HON. BIENVENIDO LAGUESMA, as Secretary of Labor and Employment, and TEMIC TELEFUNKEN MICROELECTRONICS, (PHILS.), INC., respondents. DECISION DE LEON, JR., J.: This is a petition for review on certiorari under Rule 45 of the Rules of Court seeking the reversal of the Decision[1] of the Court of Appeals dated December 23, 1999 in CAG.R. SP Nos. 54227 and 54665 and its Resolution[2] dated April 19, 2000, denying herein petitioners motion for reconsideration. The assailed Decision of respondent Court of Appeals granted the petition of private respondent TEMIC TELEFUNKEN MICROELECTRONICS, (Phils.), INC., (Company, for brevity) in CA-G.R. SP No. 54227 reversing and setting aside the Secretary of Labors: (1) Decision dated May 28, 1999; and (2) Resolution dated July 16, 1999, insofar as the Company was directed to pay backwages and grant financial assistance to the striking workers. In CA-G.R. SP No. 54665, on the other hand, the petition of TELEFUNKEN SEMICONDUCTORS EMPLOYEES UNION-FFW (Union, for brevity) and individual union members DANILO G. MADARA and ROMEO L. MANAYAO was dismissed on a finding that the Secretary of Labor did not abuse his discretion nor acted in excess of his jurisdiction when he declared illegal the strike staged by the Union, its officers and members on September 14, 1995, and that as a result thereof, those who participated therein have lost their employment status. The petition is not meritorious, and the same should be as it is hereby dismissed. The facts as borne by the records are as follows: The labor dispute started on August 25, 1995 when the Company and the Union reached a deadlock in their negotiations for a new collective bargaining agreement. On

August 28, 1995, the Union filed a Notice of Strike with the National Conciliation and Mediation Board (NCMB). On September 8, 1995,[3] the then Acting Secretary of the Department of Labor and Employment, Jose S. Brillantes, intervened and assumed jurisdiction over the dispute pursuant to Art. 263, par. (g),[4] of the Labor Code, as amended. Thus, the Order[5] of the said Acting Secretary of Labor enjoined any strike or lockout, whether actual or intended, between the parties. His Notice of the Assumption Order[6]was personally served on the representatives of the Company, namely, on Atty. Allan Montao, counsel of the Union-FFW, on September 9, 1995 at 1:25 p.m. and twice on Ms. Liza Dimaano, Union President, first on September 8, 1995 at 7:15 p.m. and again on September 11, 1995 at 9:30 a.m. but both union representatives refused to acknowledge receipt thereof. Despite the assumption Order, the Union struck on September 14, 1995. Two (2) days later, the Acting Secretary of Labor issued an Order[7]directing the striking workers to return to work within twenty-four (24) hours and for the Company to admit them back to work under the terms and conditions prevailing prior to the strike. Notice[8] of the Return-to-Work Order[9] dated September 16, 1995 of the Acting Secretary of Labor was sent to the striking Union members but still some of them refused to heed the order and continued with their picket. The Federation of Free Workers (FFW) received and acknowledged receipt of the said Return to Work Order on September 18, 1995. On September 23, 1995, violence erupted in the picket lines. The service bus ferrying nonstriking workers was stoned, causing injuries to its passengers. Thereafter, complaints for threats, defamation, illegal detention and physical injuries were filed against the strikers. On October 2, 1995, the Company issued letters of termination for cause to the workers who did not report back to work despite the Notice of Assumption and Returnto-Work Orders issued by the Acting Secretary Jose S. Brillantes of the Department of Labor and Employment (DOLE). On October 27, 1995, the Acting Secretary of Labor issued another Order[10] directing the Company to reinstate all striking workers except the Union Officers, shop stewards, and those with pending criminal charges, x x x while the resolution of the legality of the strike was pending. This exclusion Order was reaffirmed with some modifications in an Order[11] dated November 24, 1995. On December 5, 1995, the Union filed with this Court a petition for certiorari, docketed as G.R. No. 122743, questioning the exclusions made in the aforesaid Orders. On June 27, 1996, while the said petition in G.R. No. 122743 was pending, then Secretary of Labor Leonardo A. Quisumbing issued a Writ of Execution[12] for the physical reinstatement of the remaining striking workers who were not reinstated as contained in the thirty-two (32) page list[13]attached to the aforesaid writ. Accordingly, on July 3, 1996, the Company filed a Motion to Quash, Recall or Suspend the Writ of Execution[14] issued by Secretary Quisumbing.This motion was denied[15] by the Department of Labor and Employment (DOLE, for brevity) for lack of merit and, in the same Order, the DOLE directed the issuance of an Alias Writ to

enforce the actual and physical reinstatement of the workers, or in case the same was not feasible, to effect payroll reinstatement. On November 21, 1996, the Companys motion for reconsideration was also denied.[16] On December 9, 1996, the Company filed with this Court a petition for certiorari, docketed as G.R. No. 127215, questioning the denial of its motion for reconsideration and the Alias Writ issued by the DOLE to enforce the actual and physical reinstatement or the payroll reinstatement of the workers (including the Original Writ of Execution of June 27, 1996). After we consolidated[17] the petitions for certiorari of the Company and the Union in G.R. Nos. 122743 and 127215, respectively, we rendered a Decision therein on December 12, 1997. The Companys petition for certiorari in G.R. No. 127215 was dismissed for lack of merit. In G.R. No. 122743, we granted the Unions petition and ordered the reinstatement of all striking workers without exception. We also directed the Secretary of Labor and Employment to determine with dispatch the legality of the strike as well as the liability of the individual strikers, if any. After receipt of our said Decision in G.R. Nos. 122743 and 127215, the DOLE issued an Alias Writ of Execution on August 26, 1998. Thereafter, the Company moved to quash the Alias Writ which was, however, denied[18] by the DOLE. The motion for reconsideration filed by the Company was similarly denied.[19] Aggrieved by the preceding rulings of the DOLE, the Company elevated this case to this Court via another petition for certioraridocketed as G.R. No. 135788. On December 7, 1998, we resolved[20] to dismiss the said petition in G.R. No. 135788 for (a) failing to state the place of service by registered mail on the adverse party; (b) failing to submit a certification duly executed by the president of the petitioning Company or by its representative which shows its authority to represent and act on behalf of the Company; and (c) for lack of the requisite certificate of non-forum shopping. We denied this petition with finality on our March 15, 1999 Resolution [21] where we held that the Secretary of Labor did not abuse his discretion in denying the Companys motion to quash the execution of our Decision dated December 12, 1997. In compliance with our order to the Secretary of Labor and Employment to determine with dispatch the legality of the strike, marathon hearings were conducted[22] at the DOLE Office with Atty. Lita V. Aglibut as hearing officer. On September 22, 1998, both the Union and the Company complied with the order to submit their respective position papers. The Company adduced evidence and submitted its case for decision. The Union did not adduce evidence. Instead, the Union manifested that it would file a motion to dismiss for failure of the Company to prove its case with the request that it be allowed to present evidence should its motion be denied. During the subsequent hearings[23] conducted by the hearing officer of DOLE, the Union insisted that a ruling should first be made on the Demurrer to Evidence it previously filed notwithstanding repeated reminders by the Hearing Officer that the technical rules of evidence and procedure do not apply to proceedings before DOLE. Thereafter, an exchange of pleadings, reiterating their respective positions, ensued between the Company and the Union.

On May 19, 1999, the Union filed a motion before the DOLE praying for the issuance of another Alias Writ of Execution in connection with our March 15, 1999 Resolution in G.R. No. 135788. The Union contended that this Resolution has declared the dismissals of the striking workers as illegal and therefore a writ should be issued for the physical reinstatement of the workers with full backwages and other benefits reckoned from June 27, 1996. On May 28, 1999, the Secretary of Labor and Employment resolved the matter in a Decision.[24] The Secretary of Labor declared therein that in hearings and resolutions of labor disputes, before the DOLE, his Office is not governed by the strict and technical rules of evidence and procedure observed in the regular courts of law, and that it will resolve the issues based on the pleadings, the documentary evidence and other records of the case. The dispositive portion of the said Decision dated May 28, 1999 reads:

WHEREFORE, PREMISED ON THE FOREGOING, this Office hereby: a. Declares the strike conducted by the Telefunken Semiconductors Employees UnionFFW on 14 September 1995 as illegal for having been waged in open, willful and knowing defiance of the assumption order dated 8 September 1995 and the subsequent return-to-work order dated 16 September 1995 and consequently, the striking workers are declared to have lost their employment status; b. Directs the payment of backwages and other benefits to the striking workers corresponding to the temporary reinstatement periods (1) from 27 June 1996 to 28 October 1996, (2) from 21 November 1998 up to the date of this Decision; c. Directs the Telefunken Micro-Electronics (Phils.), Inc. to grant financial assistance equivalent to one (1) month for every year of service to the striking workers conformably with its grant of the same benefit to other strikers as manifested by the Company to the Supreme Court on 20 November 1997.

In this connection, the Bureau of Working Conditions, this Department, is hereby directed to compute the total award herein made and to submit its report of computation to this Office within ten (10) days from receipt of this Decision. SO ORDERED.

[25]

Dissatisfied, both the Company and the Union together with individual union members Nancy Busa and Arnel Badua, filed motions for reconsideration of the said Decision of the Secretary of Labor. On July 16, 1999,[26] the Secretary of Labor denied the said motions. The Company and the Union filed their respective petitions for certiorari docketed as CA-G.R. SP Nos. 54227 and 54665 with the Court of Appeals and these were later on consolidated. On December 23, 1999, the Court of Appeals rendered its now assailed Decision, the dispositive portion of which states:

WHEREFORE, the COMPANYs Petition in CA-G.R. No. SP 54227 is GRANTED. The Secretary of Labors Decision dated 28 May 1999 and his Resolution dated 16 July 1999 are REVERSED and SET ASIDE in so far as they direct the company to pay backwages and grant financial assistance to the striking workers. The said Decision and Resolution are AFFIRMED in all other respects. The Unions Petitions in CA-G.R. SP No. 546654 is DISMISSED. SO ORDERED. On January 24, 2000, only the Union sought reconsideration [27] of the said Decision of the appellate court. However, it was denied for lack of merit by the Court of Appeals on April 19, 2000 in its Resolution.[28] In the petition at bench, petitioners Union, Madara and Manayao submits the following assignment of errors, to wit:

THE HONORABLE COURT OF APPEALS ERRED: I

IN AFFIRMING THE DECISION OF THE RESPONDENT SECRETARY OF LABOR IN FINDING THE STRIKE STAGE BY THE UNION ILLEGAL WHICH WAS FEEBLY BASED ON THE COMPANYS POSITION PAPER AND THE MATERIALS AND PICTORIALS ATTACHED THERETO WHICH ARE BEREFT OF PROBATIVE VALUE BECAUSE THEY ARE PATENTLY INADMISSIBLE AND INCOMPETENT. II

.IN SUSTAINING THE RESPONDENT SECRETARYS DECISION EFFECTING THE WHOLESALE TERMINATION OF EMPLOYMENT OF THE STRIKING TEMIC WORKERS WITHOUT ANY DETERMINATION OF THEIR INDIVIDUAL LIABILITY, IF ANY, AS ORDERED BY THE HONORABLE SUPREME COURT, IN THE ABSENCE OF ANY ILLEGAL ACTS COMMITTED BY THE STRIKERS ATTENDANT TO THE STRIKE. III

.IN RULING THAT THE SOLE OFFICE OF THE WRIT OF CERTIORARI IS THE CORRECTION OF ERRORS OF JURISDICTION INCLUDING THE COMMISSION OF ABUSE OF DISCRETION AMOUNTING TO LACK OF JURISDICTION, DOES NOT INCLUDE CORRECTION OF HEREIN PUBLIC

RESPONDENT SECRETARY OF LABORS EVALUATION OF THE EVIDENCE AND FACTUAL FINDINGS THEREON. IV

.IN RULING IN A MANNER ABSOLUTE THAT TECHNICAL RULES OF EVIDENCE PREVAILING IN THE COURTS OF LAW AND EQUITY HAVE NO ROOM IN ADMINISTRATIVE AND/OR QUASI-JUDICIAL PROCEEDINGS. V

.IN UPHOLDING THE RESPONDENT SECRETARY OF LABORS RULING THAT THE NON-APPLICATION OF TECHNICAL RULES OF PROCEDURE IN PROCEEDINGS BEFORE THE OFFICE OF THE SECRETARY OF LABOR BARS THE PETITIONERS FROM ADDUCING EVIDENCE AFTER THE DENIAL OF THE UNION'S DEMURRER TO EVIDENCE. VI

.IN NEGATING THE PETITIONERS VESTED RIGHT TO BACKWAGES. The petition has no merit. As to the first and second assigned errors, herein petitioners contend that according to the Constitution[29] and jurisprudence,[30] strikes enjoy the presumption of legality and the burden of proving otherwise rests upon the respondent Company; that the case should not have been decided on the basis of the position paper method because in several instances[31] this Court has looked with disfavor on the position paper method in disposing labor cases; that due to the transcendental issues involved, a hearing should have been conducted to avoid the impression of denial of due process considering the dearth of evidence submitted by respondent Company; and that the pieces of evidence submitted by respondent Company are wanting in probative value. Herein petitioners also argue that for a union officer to lose his employment status it must be proved that he knowingly participated in an illegal strike; and that in the case of an ordinary member, it must not only be demonstrated that he actually participated in the illegal strike but also that he has committed illegal acts during the strike and which respondent Company allegedly failed to prove. We do not agree. Despite petitioners vain attempt to structure the case to show, on its surface, a question of law, nevertheless, the case essentially involves a question of fact. The issues raised basically boils down to a determination of whether or not the position paper and the pieces of evidence adduced by the Company before the DOLE are sufficient in probative value to overthrow the constitutional presumption of the legality of the strike. As correctly observed by the Solicitor General in his Comment,[32] it .

. . .(the first and second assigned errors) essentially involve questions of fact. It calls for a re-evaluation of facts and a re-examination of the evidence. We take this occasion to emphasize that the office of a petition for review on certiorari under Rule 45 of the Rules of Court requires that it shall raise only questions of law.[33] The factual findings by quasi-judicial agencies, such as the Department of Labor and Employment, when supported by substantial evidence, are entitled to great respect in view of their expertise in their respective fields. [34] Judicial review of labor cases does not go so far as to evaluate the sufficiency of evidence on which the labor officials findings rest.[35] It is not our function to assess and evaluate all over again the evidence, testimonial and documentary, adduced by the parties to an appeal, particularly where the findings of both the trial court (here, the DOLE Secretary) and the appellate court on the matter coincide,[36] as in this case at bar. The Rule limits that function of the Court to the review or revision of errors of law and not to a second analysis of the evidence.[37] Here, petitioners would have us re-calibrate all over again the factual basis and the probative value of the pieces of evidence submitted by the Company to the DOLE, contrary to the provisions of Rule 45. Thus, absent any showing of whimsical or capricious exercise of judgment, and unless lack of any basis for the conclusions made by the appellate court be amply demonstrated, we may not disturb such factual findings. Although we have ruled against the reliability of position papers in disposing of labor cases, in the cases of Batongbacal v. Associated Bank[38]and Progress Homes v. NLRC,[39] this was due to certain patent matters that should have been tried by the administrative agency concerned, such as certain factual circumstances which, however, are unavailing in the case at bar. In Batongbacal, we withheld judgment on the case due to the absence of a definitive factual determination of the status of petitioner therein as an assistant vicepresident of therein respondent Bank. It has not been established by the Labor Arbiter whether the petitioner therein was a managerial or a rank-and-file employee, noting that there are different causes of termination for both the managerial and rank-and-file employees. Thus, the need to remand the case was necessary. In Progress Homes, on the other hand, we found that despite the absence of any evidence to establish and support therein private respondents claim that the petitioners therein were their immediate employers, the Labor Arbiter forthwith concluded the illegal dismissal of the private respondents. Also, there was the apparent failure of the Labor Arbiter to justify why the private petitioner therein should be held solidarily liable with Progress Homes. There was a clear absence of evidence to show that petitioner therein had engaged the services of private respondents therein and that petitioner therein had acted maliciously and in bad faith in terminating the services of private respondents. The herein petitioners dismally failed to show that there really existed certain issues which would necessitate the remand of this case at bar, or that the appellate court misapprehended certain facts when it dismissed their petition for certiorari.

The need to determine the individual liabilities of the striking workers, the union officers and members alike, was correctly dispensed with by the Secretary of Labor after he gave sufficient opportunity to the striking workers to cease and desist from continuing with their picket. Ensconced in the Labor Code of the Philippines, as amended, is the rule that:

Art. 263. Strikes, picketing and lockouts. xxxxxxxxx (g) When, in his opinion, there exists a labor dispute causing or likely to cause a strike or lockout in an industry indispensable to the national interest, the Secretary of Labor and Employment may assume jurisdiction over the dispute and decide it or certify the same to the Commission for compulsory arbitration. Such assumption per certification shall have the effect of automatically enjoining the intended or impending strike or lockout as specified in the assumption or certification order. If one had already taken place at the time of assumption or certification, all striking or locked out employees shall immediately return to work and the employer shall immediately resume operations and re-admit all workers under the same terms and conditions prevailing before the strike or lockout. The Secretary of Labor and Employment or the Commission may seek the assistance of law enforcement agencies to ensure the compliance with this provision as well as with such orders as he may issue to enforce the same. (Emphasis Ours)

xxxxxxxxx It is clear from the foregoing legal provision that the moment the Secretary of Labor assumes jurisdiction over a labor dispute in an industry indispensable to national interest, such assumption shall have the effect of automatically enjoining the intended or impending strike. It was not even necessary for the Secretary of Labor to issue another order directing them to return to work. The mere issuance of an assumption order by the Secretary of Labor automatically carries with it a return-to-work order, even if the directive to return to work is not expressly stated in the assumption order.[40] However, petitioners refused to acknowledge this directive of the Secretary of Labor on September 8, 1995 thereby necessitating the issuance of another order expressly directing the striking workers to cease and desist from their actual strike, and to immediately return to work but which directive the herein petitioners opted to ignore. In this connection, Article 264(a) of the Labor Code clearly provides that:

Article 264. Prohibited Activities. (a) x x x No strike or lock out shall be declared after the assumption of jurisdiction by the President or the Secretary or after certification or submission of the dispute to compulsory or voluntary arbitration or during

the pendency of cases involving the same grounds for the strike or lockout. x x x. Any union officer who knowingly participates in illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment status: Provided, that mere participation of a worker in a lawful strike shall not constitute sufficient ground for termination of his employment even if a replacement had been hired by the employer during such lawful strike. (Emphasis Ours) The rationale of this prohibition is that once jurisdiction over the labor dispute has been properly acquired by the competent authority, that jurisdiction should not be interfered with by the application of the coercive processes of a strike.[41] We have held in a number of cases that defiance to the assumption and return-to-work orders of the Secretary of Labor after he has assumed jurisdiction is a valid ground for loss of the employment status of any striking union officer or member.[42] Furthermore, the claim of petitioners that the assumption and return-to-work Orders issued by the Secretary of Labor were allegedly inadequately served upon them is untenable in the light of what have already been clearly established in this case, to wit:

x x x, the reports of the DOLE process server, shows that the Notice of Order of 8 September 1995 was actually served on the Union President. The latter, however, refused to acknowledge receipt of the same on two separate occasions (on 8 September 1995 at 7:15 p.m. and on 11 September 1995 at 9:30 a.m.). The Unions counsel of record, Atty. Allan Montano, similarly refused to acknowledge receipt of the 8 September 1995 Order on 9 September 1995 at 1:25 p.m. Records also show that the Order of 16 September 1995 was served at the strike area with copies left with the striking workers, per the process servers return, although a certain Virgie Cardenas also refused to acknowledge receipt. The Federation of Free Workers officially received a copy as acknowledged by a certain Lourdes at 3:40 p.m. of 18 September 1995. The foregoing clearly negate the Unions contention of inadequate service of the Orders dated 8 and 16 September 1995 of Acting Secretary Brillantes. Furthermore, the DOLE process servers discharge of his function is an official act carrying the presumption of regularity in its performance which the Union has not disproved, much less disputed with clear and convincing evidence.

Likewise, it would be stretching the limits of credibility if We were to believe that the Union was unaware of the said Orders during all the conciliation conferences conducted by the NCMB-DOLE. Specifically, in the conciliation meetings after the issuance of the Order of 8 September 1995 to settle the unresolved CBA issues and after the issuance of the Order of 16 September 1995 to establish the mechanics for a smooth implementation of this Offices return-to-work directive, the Union with its officers and members in attendance never questioned the propriety or adequacy by which these Orders were served upon them. We are not unaware of the difficulty of serving assumption and return-to-work orders on striking unions and their members who invariably view the DOLEs process servers with suspicion and hostility. The refusal to receive such orders and other processes is, as described by the Supreme Court in an analogous case, an apparent attempt to frustrate the ends of justice. (Navale, et al. v. Court of Appeals, 253 SCRA 705) Such being the case, We cannot allow the Union to thwart the efficacy of the assumption and return to work orders, issued in the national interest, through the simple expediency of refusing to acknowledge receipt thereof. Having thus resolved the threshold issue as hereinabove discussed, it necessarily follows that the strike of the Union cannot be viewed as anything but illegal for having been staged in open and knowing defiance of the assumption and return-to-work orders. The necessary consequence thereof are also detailed by the Supreme Court in its various rulings. In Marcopper Mining Corp. v. Brillantes (254 SCRA 595), the High Tribunal stated in no uncertain terms that by staging a strike after the assumption of jurisdiction or certification for arbitration, workers forfeited their right to; be readmitted to work, having abandoned their employment, and so could be validly replaced. Again, in Allied Banking Corporation v. NLRC (258 SCRA 724), the Supreme Court ruled that: xxx. However, private respondents failed to take into consideration the cases recently decided by this Court which emphasized on the strict adherence to the rule that defiance of the return-to-work order of the Secretary of Labor would constitute a valid ground for dismissal. The respective liabilities of striking union officers and members who failed to immediately comply with the return-to-work order, are clearly spelled out in Article 264 of the Labor Code

which provides that any declaration of a strike or lock out after the Secretary of Labor and Employment has assumed jurisdiction over the labor dispute is considered an illegal act. Therefore, any worker or union officer who knowingly participates in a strike defying a return-to-work order may as a result thereof be considered to have lost his employment status. Viewed in the light of the foregoing, We have no alternative but to confirm the loss of employment status of all those who participated in the strike in defiance of the assumption order dated 8 September 1995 and did not report back to work as directed in the Order of 16 September 1995. [43]

To cast doubt on the regularity of the aforesaid service of the two Orders issued by the Secretary of Labor, petitioners cite Section 1, Rule IX of the NLRC Manual on Execution of Judgment which provides that:

Section 1. Hours and Days When Writ Shall Be Served. Writ of Execution shall be served at any day, except Saturdays, Sundays and holidays, between the hours of eight in the morning and five in the afternoon. x x x However, the above-cited rule is not applicable to the case at bar inasmuch as Sections 1[44] and 4,[45] Rule III of the same NLRC Manual provide that such Execution shall issue only upon a judgment or order that finally disposes of an action or proceeding. The assumption and return-to-work Orders issued by the Secretary of Labor in the case at bar are not the kind of orders contemplated in the immediately cited rule of the NLRC because such Orders of the Secretary of Labor did not yet finally dispose of the labor dispute. As pointed out by the Secretary of Labor in his Decision, petitioners cannot now feign ignorance of his official intervention, to wit:

The admissibility of the evidence presented by the Company, however, has been questioned. The Unions arguments are less than convincing. The numerous publications of the subject DOLE Orders in various newspapers, tabloids, radio and television cannot be considered hearsay and subject to authentication considering that the subject thereof were the lawful Orders of a competent government authority. In the case of the announcements posted on the Unions bulletin board, pictures of which were presented by the Company in evidence, suffice it for us to state that the bulletin board belonged to the Union. Since the veracity of the contents of the announcements on the bulletin board were never denied by the Union except to claim that these were selfserving, unverified/unverifiable and thus utterly inadmissible, We cannot but admit the same for the purpose for which it was presented. [46]

As regards the third assigned error, petitioners contend that a resolution of a petition for certiorari under Rule 65 of the Rules of Court should include the correction of

the Secretary of Labors evaluation of the evidence and factual findings thereon pursuant to the doctrine laid down in Meralco v. The Honorable Secretary of Labor Leonardo A. Quisumbing.[47] That contention is misplaced. In that case, we ruled that:

The extent of judicial review over the Secretary of Labors arbitral award is not limited to a determination of grave abuse in the manner of the secretarys exercise of his statutory powers. This Court is entitled to, and must in the exercise of its judicial power review the substance of the Secretarys award when grave abuse of discretion is alleged to exist in the award, i.e., in the appreciation of and the conclusions the Secretary drew from the evidence presented. However, this Courts review (of) the substance does not mean a re-calibration of the evidence presented before the DOLE but only a determination of whether the Secretary of Labors award passed the test of reasonableness when he arrived at his conclusions made thereon. Thus, we declared in Meralco, that:

In this case we believe that the more appropriate and available standard and one does not require a constitutional interpretationis simply the standard of reasonableness. In laymans terms, reasonableness implies the absence of arbitrariness; in legal parlance, this translates into the exercise of proper discretion and to the observance of due process. Thus, the question we have to answer in deciding this case is whether the Secretarys actions have been reasonable in light of the parties positions and the evidence they presented.

[48]

Thus, notwithstanding any allegation of grave abuse of discretion, unless it can be amply demonstrated that the Secretary of Labors arbitral award did not pass the test of reasonableness, his conclusions thereon shall not be disturbed, as in the case at bar. The main thrust of a petition for certiorari under Rule 65 of the Rules of Court is only the correction of errors of jurisdiction including the commission of grave abuse of discretion amounting to lack or excess of jurisdiction. However, for this Court to properly exercise the power of judicial review over a decision of an administrative agency, such as the DOLE, it must first be shown that the tribunal, board or officer exercising judicial or quasi-judicial functions has indeed acted without or in excess of its or his jurisdiction, and that there is no appeal, or any plain, speedy and adequate remedy in the ordinary course of law.[49] In the absence of any showing of lack of jurisdiction or grave abuse tantamount to lack or excess of jurisdiction, judicial review may not be had over an administrative agencys decision. We have gone over the records of the case at bar and we see no cogent basis to hold that the Secretary of Labor has abused his discretion. In the fourth and fifth assignment of errors, petitioners would have us believe that the Court of Appeals, in its assailed Decision ruled in a manner absolute that prevailing technical rules of evidence in the courts of law and equity have no room in administrative and/or quasi-judicial proceedings;and that the non-application of

technical rules of procedure in proceedings before the Office of the Secretary of Labor should not have barred herein petitioners from adducing evidence after their demurrer to evidence was denied. We do not agree. That declaration of the Court of Appeals should be taken in the context of the whole paragraph and the law and the jurisprudence cited in the assailed portion of its decision. We do not sanction the piecemeal interpretation of a decision to advance ones case. To get the true intent and meaning of a decision, no specific portion thereof should be isolated and resorted to but the decision must be considered in its entirety.[50] The portion of the Court of Appeals assailed Decision reads, to wit:

x x x, it cannot be gainsaid that technical rules of evidence prevailing in courts of law and equity have no room in administrative and/or quasi-judicial proceedings (Lawin Security Services, Inc. v. National Labor Relations Commission, 273 SCRA 132; Valderama v. National Labor Relations Commission, 256 SCRA 466; De Ysasi III v. National Labor Relations Commission, 231 SCRA 173). In fact, Article 221 of the Labor Code expressly mandates that in proceedings before the (National Labor Relations) Commission or any of the Labor Arbiters, the rules of evidence prevailing in courts of law or equity shall not be controlling x x x. This provision is also applicable to proceedings before the Office of the Secretary of Labor and Employment which, under the said Code, is empowered to hear and resolve matters arising from the exercise of its plenary power to issue assumption or (sic) jurisdiction and return-to-work orders, all in keeping with the national interest (Article 263(g) and Article 264 of the Labor Code). [51]

The contention of petitioners that they should have been allowed to present evidence when their demurrer to evidence was denied by the Secretary of Labor, is untenable. The record shows that in the hearing of September 22, 1998 attended by the parties, Atty. Lita V. Aglibut, Hearing Officer, of the public respondents office, who presided over the hearing directed the parties to submit their respective position papers together with the affidavits and documentary evidence within ten (10) days.[52] While the Company submitted its position paper together with supporting evidence and rested its case for resolution, herein petitioners, however, submitted only its position paper but without attaching thereto any supporting documentary evidence. Petitioners chose to rely on the Rules of Court by filing a demurrer to evidence in the hope of a favorable decision and disregarded our resolution in G.R. No. 127215 ordering the Secretary of Labor to determine with dispatch the legality of the strike. On the other hand, the petitioners argued merely on the presumption that the strike was legal. The fact that the Hearing Officer of DOLE admitted their demurrer to evidence is not a valid excuse for herein petitioners not to comply with her said directive for the petitioners to submit their position paper and to attach thereto affidavits and documentary evidence within ten (10) days. Petitioners non-compliance with that directive by failing or refusing to attach affidavits and supporting evidence to their position paper should not be ascribed as the fault of the Secretary of Labor when he

denied their demurrer to evidence and forthwith rendered decision on the illegality of the strike. Petitioners have only themselves to blame for having defied the order of the said Hearing Officer of DOLE to submit position papers with supporting evidence. A party who has availed of the opportunity to present his position paper cannot claim to have been denied due process.[53] The requirements of due process are satisfied when the parties to a labor case are given the opportunity to submit position papers wherein they are supposed to attach all the documents that would prove their claim in the event it will be decided that no further hearing should be conducted or that hearing was not necessary.[54] The grant of plenary powers to the Secretary of Labor under Art. 263(g) of the Labor Code, as amended, makes it incumbent for him to bring about soonest, a fair and just solution to the differences between the employer and the employees so that the damage such labor dispute might cause upon the national interest may be minimized as much as possible, if not totally averted, by avoiding stoppage of work or any lagging of the activities of the industry or the possibility of these contingencies which might cause detriment to such national interest.[55] Accordingly, he may adopt the most reasonable and expeditious way of writing finis to the labor dispute. Otherwise, the result would be absurd and contrary to the grant of plenary powers to him by the Labor Code over a labor dispute causing or likely to cause a strike or lockout in an industry indispensable to the national interest. And finally, with respect to petitioners claim of backwages, we find that the ratiocination of the appellate court in its assailed Decision is in accord with law and settled jurisprudence, to wit:

On the issue of the award of backwages and financial assistance to the striking workers, the well-entrenched doctrine is that it is only when there is a finding of illegal dismissal that backwages are granted (St. Theresas School of Novaliches Foundation vs. National Labor Relations Commission, 289 SCRA 111; Industrial Timber Corporation-Stanply Operations vs. National Labor Relations Commission, 253 SCRA 623; Jackson Building Condominium Corporation, 246 SCRA 329), and financial assistance or separation pay allowed (Mabeza v. National Labor Relations Commission, 271 SCRA 670; Capili v. National Labor Relations Commission, 270 SCRA 688; Aurora Land Projects Corporation v. National Labor Relations Commission, 266 SCRA 48). Since, as correctly found by the Secretary of Labor, the strikers were not illegally dismissed, the COMPANY is under no obligation to pay backwages to them. It is simply inconsistent, nay, absurd, to award backwages when there is no finding of illegal dismissal (Filflex Industrial and Manufacturing Corporation, 286 SCRA 245). xxx when the record shows that the striking workers did not comply with lawful orders for them to return to work during said periods of time. In fact, the Secretary of Labor observed that while it was obligatory on the part of both parties to restore, in the meantime, the status quo obtaining in the workplace, the same was not possible considering the strikers had defied the return-to-work

Order of this Office (p. 8, Ibid). With such blatant disregard by the strikers of official edicts ordering their temporary reinstatement, there is no basis to award them backwages corresponding to said time frames. Otherwise, they will recover something they have not or could not have earned by their willful defiance of the return-to-work order, a patently incongruous and unjust situation (Santos v. National Labor Relations Commission, 154 SCRA 166). The same view holds with respect to the award of financial assistance or separation pay. The assumption for granting financial assistance or separation pay, which is, that there is an illegally dismissed employee and that illegally dismissed employee would otherwise have been entitled to reinstatement, is not present in the case at bench. Here, the striking workers have been validly dismissed. Where the employees dismissal was for a just case, it would be neither fair nor just to allow the employee to recover something he has not earned or could not have earned. This being so, there can be no award of backwages, for it must be pointed out that while backwages are granted on the basis of equity for earnings which a worker or employee has lost due to his illegal dismissal, where private respondents dismissal is for just cause, as is (sic) the case herein, there is no factual or legal basis to order the payment of backwages; otherwise, private respondent would be unjustly enriching herself at the expense of petitioners. (Cathedral School of Technology v. National Labor Relations Commission, 214 SCRA 551). Consequently, granting financial assistance to the strikers is clearly a specious Inconsistency supra. We are of course aware that financial assistance may be allowed as a measure of social justice in exceptional circumstances and as an equitable concession. We are likewise mindful that financial assistance is allowed only in those instances where the employee is validly dismissed for causes other than serious misconduct or those reflecting on his moral character (Zenco Sales, Inc. v. National Labor Relations Commission, 234 SCRA 689). However, the attendant facts show that such exceptional circumstances do not obtain in the instant cases to warrant the grant of financial assistance to the striking workers. To our mind, the strikers open and willful defiance of the assumption order dated September 16, 1995 constitute serious misconduct as well as reflective of their moral character, hence, granting financial assistance to them is not and cannot be justified (Philippines Airlines, Inc. v. National Labor Relations Commission, 282 SCRA 536, citing Philippine Long Distance Telephone Company v. National Labor Relations Commission, 164 SCRA 671).[56] In fine, there is no reversible error in the assailed Decision and Resolution of the Court of Appeals. WHEREFORE, the petition is DISMISSED. The appealed Decision dated December 23, 1999 and the Resolution dated April 19, 2000 of public respondent Court of Appeals are AFFIRMED. No costs. SO ORDERED. U. [G.R. No. 100158. June 29, 1992.] ST. SCHOLASTICA’S COLLEGE, Petitioner, v. HON. RUBEN TORRES, in his capacity as SECRETARY OF LABOR AND EMPLOYMENT, and SAMAHAN NG MANGGAGAWANG PANG-EDUKASYON SA STA. ESKOLASTIKA-NAFTEU, Respondents. Ernesto R. Arellano for Private Respondent.

William T. Chua for Petitioner.

SYLLABUS

1. LABOR AND SOCIAL LEGISLATION; SECRETARY OF LABOR AND EMPLOYMENT; SCOPE OF POWER TO ASSUME JURISDICTION OVER LABOR DISPUTES CAUSING OR LIKELY TO CAUSE STRIKE OR LOCKOUT IN AN INDUSTRY INDISPENSABLE TO THE NATIONAL INTEREST. — The issue on whether respondent SECRETARY has the power to assume jurisdiction over a labor dispute and its incidental controversies, causing or likely to cause a strike or lockout in an industry indispensable to the national interest, was already settled in International Pharmaceuticals, Inc. v. Secretary of Labor and Employment (G.R. Nos. 92981-83, 9 January 1992). Therein, We ruled that: ". . . [T]he Secretary was explicitly granted by Article 263 (g) of the Labor Code the authority to assume jurisdiction over a labor dispute causing or likely to cause a strike or lockout in an industry indispensable to the national interest, and decide the same accordingly. Necessarily, this authority to assume jurisdiction over the said labor dispute must include and extend to all questions and controversies arising therefrom, including cases over which the Labor Arbiter has exclusive jurisdiction." And rightly so, for, as found in the aforesaid case, Article 217 of the Labor Code did contemplate of exceptions thereto where the SECRETARY is authorized to assume jurisdiction over a labor dispute otherwise belonging exclusively to the Labor Arbiter. This is readily evident from its opening proviso reading" (e)xcept as otherwise provided under this Code . . ." cralaw virtua1aw l i brary

2. ID.; ID.; ID.; REQUISITES BEFORE THE SECRETARY MAY TAKE COGNIZANCE OF AN INCIDENTAL ISSUE OF A LABOR DISPUTES. — Previously, We held that Article 263 (g) of the Labor Code was broad enough to give the Secretary of Labor and Employment the power to take jurisdiction over an issue involving unfair labor practice. (Meycuayan College v. Drilon, G.R. No. 81144, 7 May 1990; 185 SCRA 50) At first glance, the rulings above stated seem to run counter to that of PAL v. Secretary of Labor and Employment, (193 SCRA 223), which was cited by petitioner. But the conflict is only apparent, not real. To recall, We ruled in the latter case that the jurisdiction of the Secretary of Labor and Employment in assumption and/or certification cases is limited to the issues that are involved in the disputes or to those that are submitted to him for resolution. The seeming difference is, however, reconcilable. Since the matter on the legality or illegality of the strike was never submitted to him for resolution, he was thus found to have exceeded his jurisdiction when he restrained the employer from taking disciplinary action against employees who staged an illegal strike. Before the Secretary of Labor and Employment may take cognizance of an issue which is merely incidental to the labor dispute, therefore, the same must be involved in the labor dispute itself, or otherwise submitted to him for resolution. If it was not, as was the case in PAL v. Secretary of Labor and Employment, supra, and he nevertheless acted on it, that assumption of jurisdiction is tantamount to a grave abuse of discretion. Otherwise, the ruling in International Pharmaceuticals, Inc. v. Secretary of Labor and Employment, supra, will apply. The submission of an incidental issue of a labor dispute, in assumption and/or certification cases, to the Secretary of Labor and Employment for his resolution is thus one of the instances referred to whereby the latter may exercise concurrent jurisdiction together with the Labor Arbiters. 3. ID.; ID.; ID.; ACADEMIC INSTITUTIONS COVERED. — The assumption of jurisdiction by the Secretary of Labor and Employment over labor disputes involving academic institutions was already upheld in Philippine School of Business Administration v. Noriel (G.R. No. 80648, 15 August 1988, 164 SCRA 402) where We ruled thus: "There is no doubt that the on-going labor dispute at the school adversely affects the national interest. The school is a duly registered educational institution of higher learning with more or less 9,000 students. The on-going work stoppage at the school unduly prejudices the students and will entail great loss in terms of time, effort and money to all concerned. More important, it is not amiss to mention that the school is engaged in the promotion of the physical, intellectual and emotional well-being of the country’s youth." Respondent UNION’s failure to immediately comply with the return-to-work order of 5 November 1990, therefore, cannot be condoned. 4. ID.; ID.; ID.; ID.; PURPOSE THEREOF; CASE AT BAR. — In the instant petition, the COLLEGE in its Manifestation, dated 16 November 1990, asked the "Secretary of Labor to take the appropriate steps under the said circumstances." It likewise prayed in its position paper that respondent SECRETARY uphold its termination of the striking employees. Upon the other hand, the UNION questioned the termination of its officers and members before respondent SECRETARY by moving for the enforcement of the return-to-work orders. There is no dispute then that the issue on the legality of the termination of striking employees was properly submitted to respondent SECRETARY for resolution. Such an interpretation will be in consonance with the intention of our labor authorities to provide workers immediate access to their rights and benefits without being inconvenienced by the arbitration and litigation process that prove to be not only nerve-wracking, but financially burdensome in the long run. Social justice legislation, to be truly meaningful and rewarding to our workers, must not be hampered in its application by long-winded arbitration and litigation. Rights must be asserted and benefits received with the least inconvenience. For, labor laws are meant to promote, not defeat, social justice (Maternity Children’s Hospital v. Hon. Secretary of Labor, G.R. No. 78909, 30 June 1989; 174 SCRA 632). After all, Art. 4 of the Labor Code does state that all doubts in the implementation and interpretation of its provisions, including its implementing rules and regulations, shall be resolved in favor of labor. 5. ID.; ID.; RETURN TO WORK ORDER THEREOF; IMMEDIATELY EFFECTIVE AND EXECUTORY NOTWITHSTANDING THE FILING OF THE MOTION FOR RECONSIDERATIONS; RATIONALE; CASE AT BAR. — Article 263 (g) of the Labor Code provides that if a strike has already taken place at the time of assumption, "all striking . . . employees shall immediately return to work." This means that by its very terms, a return-to-work order is immediately effective and executory notwithstanding the filing of a motion for reconsideration (University of Sto. Tomas v. NLRC, G.R. No. 89920, 18 October 1990; 190 SCRA 759). It must be strictly complied with even during the pendency of any petition questioning its validity (Union of Filipro Employees v. Nestle’ Philippines, Inc., 192 SCRA 396). After all, the assumption and/or certification order is issued in the exercise of respondent SECRETARY’s compulsive power of arbitration and, until set aside, must therefore be immediately complied with. The rationale for this rule is explained in University of Sto. Tomas v. NLRC, supra, citing Philippine Air Lines Employees Association v. Philippine Air Lines, Inc., 38 SCRA 372 (1971) thus — "To say that its (return-to-work order) effectivity must wait affirmance in a motion for reconsideration is not only to emasculate it but indeed to defeat its import, for by then the deadline fixed for the return to work would, in the ordinary course, have already passed and hence can no longer be affirmed insofar as the time element is concerned." cralaw vi rtua 1aw lib rary

6. ID.; ID.; ID.; ID.; STRIKES DECLARED IN DEFIANCE THERETO; CONSIDERED ILLEGAL; LIABILITY OF PARTICIPANTS. — The respective liabilities of striking union officers and members who failed to immediately comply with the return-to-work order is outlined in Art. 264 of the Labor Code which provides that any declaration of a strike or lockout after the Secretary of Labor and Employment has assumed jurisdiction over the labor dispute is considered an illegal act. Any worker or union officer who knowingly participates in a strike defying a return-to-work order may, consequently, "be declared to have lost his employment status." Section 6, Rule IX, of the New Rules of Procedure of the NLRC, which provides the penalties for defying a certification order of the Secretary of Labor or a return-to-work order of the Commission, also reiterates the same penalty. It specifically states that non-compliance with the aforesaid orders, which is considered an illegal act, "shall authorize the Secretary of Labor and Employment or the Commission . . . to enforce the same under pain of loss of employment status." Under the Labor Code, assumption and/or certification orders are similarly treated. Thus, we held in Sarmiento v. Tuico, 162 SCRA 676, that by insisting on staging the restrained strike and defiantly picketing the company premises to prevent the resumption of operations, the strikers have forfeited their right to be readmitted, having abandoned their positions, and so could be validly replaced. 7. ID.; ID.; ID.; ID.; ID.; ID.; EFFECTIVE FROM THE MOMENT THE EMPLOYEE DEFIES THE ORDER. — It is clear from the provisions above quoted that from the moment a worker defies a return-to-work order, he is deemed to have abandoned his job. It is already in itself knowingly participating in an illegal act. Otherwise, the worker will just simply refuse to return to his work and cause a standstill in the company operations while retaining the positions they refuse to discharge or allow the management to fill (Sarmiento v. Tuico, supra). Suffice it to say, in Federation of Free Workers v. Inciong, supra, the workers were terminated from work after defying the return-to-work order for only nine (9) days. It is indeed inconceivable that an employee, despite a return-to-work order, will be allowed in the interim to stand akimbo and wait until five (5) orders shall have been issued for their return before they report back to work. This is absurd. 8. ID.; CONSTRUCTION OF THE RULES THEREOF IN FAVOR OF LABOR; DOES NOT APPLY IN CASE OF WILLFUL DISOBEDIENCE THERETO. — The sympathy of the Court which, as a rule, is on the side of the laboring classes (Reliance Surety & Insurance Co., Inc. v. NLRC, G.R. No. 86917-18, 25 January 1991; 193 SCRA 365), cannot be extended to the striking union officers and members in the instant petition. There was willful disobedience not only to one but two return-to-work orders. Considering that the UNION consisted mainly of teachers, who are supposed to be well-lettered and well-informed, the Court cannot overlook the plain arrogance and pride displayed by the UNION in this labor dispute. Despite containing threats of disciplinary action against some union officers and members who actively participated in the strike, the letter dated 9 November 1990 sent by the COLLEGE enjoining the union officers and members to return to work on 12 November 1990 presented the workers an opportunity to return to work under the same terms and conditions prior to the strike. Yet, the UNION decided to ignore the same. The COLLEGE, correspondingly, had every right to terminate the services of those who chose to disregard the return-to-work orders issued by respondent SECRETARY in order to protect the interests of its students who form part of the youth of the land.

DECISION

BELLOSILLO, J.:

The principal issue to be resolved in this recourse is whether striking union members terminated for abandonment of work after failing to comply with return-to-work orders of the Secretary of Labor and Employment (SECRETARY, for brevity) should by law be reinstated. cralawnad

On 20 July 1990, petitioner St. Scholastica’s College (COLLEGE, for brevity) and private respondent Samahan ng Manggagawang Pang-Edukasyon sa Sta. Eskolastika — NAFTEU (UNION, for brevity) initiated negotiations for a first-ever collective bargaining agreement. A deadlock in the negotiations prompted the UNION to file on 4 October 1990 a Notice of Strike with the Department of Labor and Employment (DEPARTMENT, for brevity), docketed as NCMB-NCR-NS-10-826-90. On 5 November 1990, the UNION declared a strike which analyzed the operations of the COLLEGE. Affecting as it did the interest of the students, public respondent SECRETARY immediately assumed jurisdiction over the labor dispute and issued on the same day, 5 November 1990, a return-to-work order. The following day, 6 November 1990, the UNION was served the Order. On 7 November 1990, instead of returning to work, the UNION filed a motion for reconsideration of the return-towork order questioning inter alia the assumption of jurisdiction by the SECRETARY over the labor dispute. On 9 November 1990, the COLLEGE sent individual letters to the striking employees enjoining them to return to work not later than 8.00 o’clock A.M. of 12 November 1990 and, at the same time, giving notice to some twenty-three (23) workers that their return would be without prejudice to the filing of appropriate charges against them. In response, the UNION presented a list of six (6) demands to the COLLEGE a dialogue conducted on 11 November 1990. The most important of these demands was the unconditional acceptance back to work of the striking employees. But these were flatly rejected. Likewise, on 9 November 1990, respondent SECRETARY denied reconsideration of his return-to-work order and sternly warned the striking employees to comply with its terms. On 12 November 1990, the UNION received the Order. Thereafter, particularly on 14 and 15 November 1990, the parties held conciliation meetings before the National Conciliation and Mediation Board where the UNION pruned down its demands to three (3), viz.: that striking employees be reinstated under the same terms and conditions before the strike; that no retaliatory or disciplinary action be taken against them; and, that CBA negotiations be continued. However, these efforts proved futile as the COLLEGE remained steadfast in its position that any return-to-work offer should be unconditional. On 16 November 1990, the COLLEGE manifested to respondent SECRETARY that the UNION continued to defy his return-to-work order of 5 November 1990 so that "appropriate steps under the said circumstances" may be undertaken by him. 1 On 23 November 1990, the COLLEGE mailed individual notices of termination the striking employees, which were received on 26 November 1990, or later. The UNION officers and members then tried to return to work but were no longer accepted by the COLLEGE. On 5 December 1990, a Complaint for Illegal Strike was filed against the UNION, its officers and several of its members before the National Labor Relations Commission (NLRC), docketed as NLRC Case No. 00-12-06256-90. The UNION moved for the enforcement of the return-to-work order before respondent SECRETARY, citing "selective acceptance of returning strikers" by the COLLEGE. It also sought dismissal of the complaint. Since then, no further hearings were conducted. Respondent SECRETARY required the parties to submit their respective position papers. The COLLEGE prayed that respondent SECRETARY uphold the dismissal of the employees who defied his return-to-work order. On 12 April 1991, respondent SECRETARY issued the assailed Order which, inter alia directed the reinstatement of striking UNION members, premised on his finding that no violent or otherwise illegal act accompanied the conduct of the strike and that a fledgling UNION like private respondent was "naturally expected to exhibit unbridled if inexperienced enthusiasm, in asserting its existence." 2 Nevertheless, the aforesaid Order held UNION officers responsible for the violation of the return-towork orders of 5 and 9 November 1990 and, correspondingly, sustained their termination. Both parties moved for partial reconsideration of the Order, with petitioner COLLEGE questioning the wisdom of the reinstatement of striking UNION members, and private respondent UNION, the dismissal of its officers. On 31 May 1991, in a Resolution, respondent SECRETARY denied both motions. Hence, this Petition for Certiorari, with Prayer for the Issuance of a Temporary Restraining Order. On 26 June 1991, We restrained the SECRETARY from enforcing his assailed Orders insofar as they directed the reinstatement of the striking workers previously terminated. chanroble s.com : virtual law lib rary

Petitioner questions the assumption by respondent SECRETARY of jurisdiction to decide on termination disputes, maintaining that such jurisdiction is vested instead in the Labor Arbiter pursuant to Art. 217 of the Labor Code, thus — "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, the following cases involving all workers, whether agricultural or non-agricultural: . . . 2. Termination disputes . . . 5. Cases arising from any violation of Article 264 of this Code, including questions on the legality of strikes and lock-outs . . ." cralaw virtua 1aw lib rary

In support of its position, petitioner invokes Our ruling in PAL v. Secretary of Labor and Employment 3 where We held:

jgc:chan robles. com.ph

"The Labor Secretary exceeded his jurisdiction when he restrained PAL from taking disciplinary measures against its guilty employees, for, under Art. 263 of the Labor Code, all that the Secretary may enjoin is the holding of the strike but not the company’s right to take action against union officers who participated in the illegal strike and committed illegal acts." cralaw virtua1aw l ibra ry

Petitioner further contends that following the doctrine laid down in Sarmiento v. Tuico 4 and Union of Filipro Employees v. Nestle’ Philippines, Inc., 5 workers who refused to obey a return-to-work order are not entitled to be paid for work not done, or to reinstatement to the positions they have abandoned by reason of their refusal to return thereto as ordered. Taking a contrary stand, private respondent UNION pleads for reinstatement of its dismissed officers considering that the act of the UNION in continuing with its picket was never characterized as a "brazen disregard of successive legal orders", which was readily apparent in Union Filipro Employees v. Nestle’ Philippines, Inc., supra, nor was it a willful refusal to return to work, which was the basis of the ruling in Sarmiento v. Tuico, supra. The failure of UNION officers and members to immediately comply with the return-to-work orders was not because they wanted to defy said orders; rather, they held the view that academic institutions were not industries indispensable to the national interest. When respondent SECRETARY denied their motion, for reconsideration, however, the UNION intimated that efforts ware immediately initiated to fashion out a reasonable return-to-work agreement with the COLLEGE, albeit, it failed. The issue on whether respondent SECRETARY has the power to assume jurisdiction over a labor dispute and its incidental controversies, causing or likely to cause a strike or lockout in an industry indispensable to the national interest, was already settled in International Pharmaceuticals, Inc. Secretary of Labor and Employment. 6 Therein, We ruled that: jgc:chan roble s.com.p h

". . . [T]he Secretary was explicitly granted by Article 263 (g) of the Labor Code the authority to assume jurisdiction over a labor dispute causing or likely to cause a strike or lockout in an industry indispensable to the national interest, and decide the same accordingly. Necessarily, this authority to assume jurisdictional over the said labor dispute must include and extend to all questions and controversies arising therefrom, including cases over which the Labor Arbiter has exclusive jurisdiction." c ralaw virtua1aw l ibra ry

And rightly so, for, as found in the aforesaid case, Article 217 of the Labor Code did contemplate of exceptions thereto where the SECRETARY is authorized to assume

jurisdiction over a labor dispute otherwise belonging exclusively to the Labor Arbiter. This is readily evident from its opening proviso reading" (e)xcept as otherwise provided under this Code . . ." cralaw virt ua1aw li bra ry

Previously, We held that Article 263 (g) of the Labor Code was broad enough to give the Secretary of Labor and Employment the power to take jurisdiction over an issue involving unfair labor practice. 7 At first glance, the rulings above stated seem to run counter to that of PAL v. Secretary or Labor and Employment, supra, which was, cited by petitioner. But the conflict is only apparent, not real. To recall, We ruled in the latter case that the jurisdiction of the Secretary of Labor and Employment in assumption and/or certification cases is limited to the issues that are involved in the disputes or to those that are submitted to him for resolution. The seeming difference is, however, reconcilable. Since the matter on the legality or illegality of the strike was never submitted to him for resolution, he was thus found to have exceeded his jurisdiction when he restrained the employer from taking disciplinary action against employees who staged an illegal strike. Before the Secretary of Labor and Employment may take cognizance of an issue which is merely incidental to the labor dispute, therefore, the same must be involved in the labor dispute itself, or otherwise submitted to him for resolution. If it was not, as was the case in PAL v. Secretary of Labor and Employment, supra, and he nevertheless acted on it, that assumption of jurisdiction is tantamount to a grave abuse of discretion. Otherwise, the ruling in International Pharmaceuticals, Inc. v. Secretary of Labor and Employment, supra, will apply. The submission of an incidental issue of a labor dispute, in assumption and/or certification cases, to the Secretary of Labor and Employment for his resolution is thus one of the instances referred to whereby the latter may exercise concurrent jurisdiction together with the Labor Arbiters. In the instant petition, the COLLEGE in its Manifestation, dated 16 November 1990, asked the "Secretary of Labor to take the appropriate steps under the said circumstances." It likewise prayed in its position paper that respondent SECRETARY uphold its termination of the striking employees. Upon the other hand, the UNION questioned the termination of its officers and members before respondent SECRETARY by moving for the enforcement of the return-to-work orders. There is no dispute then that the issue on the legality of the termination of striking employees was properly submitted to respondent SECRETARY for resolution. Such an interpretation will be in consonance with the intention of our labor authorities to provide workers immediate access to their rights and benefits without being inconvenienced by the arbitration and litigation process that prove to be not only nerve-wracking, but financially burdensome in the long run. Social justice legislation, to be truly meaningful and rewarding to our workers, must not be hampered in its application by long-winded arbitration and litigation. Rights must be asserted and benefits received with the least inconvenience. For, labor laws are meant to promote, not defeat, social justice (Maternity Children’s Hospital v. Hon. Secretary of Labor). 8 After all, Art. 4 of the Labor Code does state that all doubts in the implementation and interpretation of its provisions, including its implementing rules and regulations, shall be resolved in favor of labor. We now come to the more pivotal question of whether striking union members, terminated for abandonment of work after failing to comply strictly with a return-towork order, should be reinstated. We quote hereunder the pertinent provisions of law which govern the effects of defying a return-to-work order:

chanrob1e s virtual 1aw lib rary

1. Article 263 (g) of the Labor Code — "Art. 263. Strikes, picketing, and lockouts. — . . . (g) When, in his opinion, there exists a labor dispute causing or likely to cause a strike or lockout in an industry indispensable to the national interest, the Secretary of Labor and Employment may assume jurisdiction over the dispute and decide it or certify the same to the Commission for compulsory arbitration. Such assumption or certification shall have the effect of automatically enjoining the intended or impending strike or lockout as specified in the assumption or certification order. If one has already taken place at the time of assumption or certification, all striking or locked out employees shall immediately return to work and the employer shall immediately resume operations and readmit all workers under the same terms and conditions prevailing before the strike or lookout. The Secretary of Labor and Employment or the Commission may seek the assistance of law enforcement agencies to ensure compliance with this provision as well as with such orders as he may issue to enforce the same . . ." (as amended by Sec. 27, R.A. 6715; Emphasis supplied). 2. Article 264, same Labor Code — "Art. 264. Prohibited activities. — (a) No labor organization or employer shall declare a strike or lockout without first having bargained collectively in accordance with Title VII of this Book or without first having filed the notice required in the preceding Article or without the necessary strike or lockout vote first having been obtained and reported to the Ministry. "No strike or lockout shall be declared after assumption of jurisdiction by the President or the Minister or after certification or submission of the dispute to compulsory or voluntary arbitration or during the pendency of cases involving the same grounds for the strike or lockout . . . (Emphasis supplied). "Any worker whose employment has been terminated as a consequence of an unlawful lockout shall be entitled to reinstatement with full back wages. Any union officer who knowingly participates in an illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment status; Provided, That mere participation of a worker in a lawful strike shall not constitute sufficient ground for termination of his employment, even if a replacement had been hired by the employer during such lawful strike . . ." (Emphasis supplied). 3. Section 6, Rule IX, of the New Rules of Procedure of the NLRC (which took effect on 31 August 1990) — "Section 6. Effects of Defiance. — Non-compliance with the certification order of the Secretary of Labor and Employment or a return to work order of the Commission shall be considered an illegal act committed in the course of the strike or lookout and shall authorize the Secretary of Labor and Employment or the Commission, as the case may be, to enforce the same under pain or loss of employment status or entitlement to full employment benefits from the locking-out employer or backwages, damages and/or other positive and/or affirmative reliefs, even to criminal prosecution against the liable parties . . ." (Emphasis supplied). Private respondent UNION maintains that the reason they failed ko immediately comply with the return-to-work order of 5 November 1990 was because they questioned the assumption of jurisdiction of respondent SECRETARY. They were of the impression that being an academic institution, the school could not be considered an industry indispensable to national interest, and that pending resolution of the issue, they were under no obligation to immediately return to work. This position of the UNION is simply flawed. Article 263 (g) Labor Code provides that if a strike has already taken place at the time of assumption, "all striking . . . employees shall immediately return to work." This means that by its very terms, a return-to-work order is immediately effective and executory notwithstanding the filing of a motion for reconsideration (University of Sto. Tomas v. NLRC). 9 It must be strictly complied with even during the pendency of any petition questioning its validity (Union of Filipro Employees v. Nestle’ Philippines, Inc., supra) After all, the assumption and/or certification order is issued in the exercise of respondent SECRETARY’s compulsive power of arbitration and, until set aside, must therefore be immediately complied with. The rationale for this rule is explained in University of Sto. Tomas v. NLRC, supra, citing Philippine Air Lines Employees Association v. Philippine Air Lines, Inc., 10 thus — "To say that its (return-to-work order) effectivity must wait affirmance in a motion for reconsideration is not only to emasculate it but indeed to defeat its import, for by then the deadline fixed for the return to work would, in the ordinary course, have already passed and hence can no longer be affirmed insofar as the time element is concerned." cralaw virtua 1aw lib rary

Moreover, the assumption of jurisdiction by the Secretary of Labor and Employment over labor disputes involving academic institutions was already upheld in Philippine School of Business Administration v. Noriel 11 where We ruled thus: jgc:c hanrobles. com.ph

"There is no doubt that the on-going labor dispute at the school adversely affects the national interest. The school is a duly registered educational institution of higher learning with more or less 9,000 students. The on-going work stoppage at the school unduly prejudices the students and will entail great loss in terms of time, effort and money to all concerned. More important, it is not amiss to mention that the school is engaged in the promotion of the physical, intellectual and emotional wellbeing of the country’s youth." cralaw vi rtua 1aw lib rary

Respondent UNION’s failure to immediately comply with the return-to-work order of 5 November 1990, therefore, cannot be condoned.

The respective liabilities of striking union officers and members who failed to immediately comply with the return-to-work order is outlined in Art. 264 of the Labor Code which provides that any declaration of a strike or lockout after the Secretary of Labor and Employment has assumed jurisdiction over the labor dispute is considered an illegal act. Any worker or union officer who knowingly participates in a strike defying a return-to-work order may, consequently, "be declared to have lost his employment status." cralaw virtua 1aw lib rary

Section 6, Rule IX, of the New Rules of Procedure of the NLRC, which provides the penalties for defying a certification order of the Secretary of Labor or a return-towork order of the Commission, also reiterates the same penalty. It specifically states that non-compliance with the aforesaid orders, which is considered an illegal act, "shall authorize the Secretary of Labor and Employment or the Commission . . . to enforce the same under pain of loss of employment status." Under the Labor Code, assumption and/or certification orders are similarly treated. Thus, we held in Sarmiento v. Tuico, supra, that by insisting on staging the restrained strike and defiantly picketing the company premises to prevent the resumption of operations, the strikers have forfeited their right to be readmitted, having abandoned their positions, and so could be validly replaced. chanroble s virtual law lib rary

We recently reiterated this stance in Federation of Free Workers v. Inciong, 12 wherein we cited Union of Filipro Employees v. Nestle’ Philippines, Inc., supra, thus — "A strike undertaken despite the issuance by the Secretary of Labor of an assumption or certification order becomes a prohibited activity and thus illegal, pursuant to the second paragraph of Art. 264 of the Labor Code as amended . . . The union officers and members, as a result, are deemed to have lost their employment status for having knowingly participated in an illegal act." cralaw virtua1aw l ibra ry

Despite knowledge of the ruling in Sarmiento v. Tuico, supra, records of the case reveal that private respondent UNION opted to defy not only the return-to-work order of 5 November 1990 but also that of 9 November 1990. While they claim that after receiving copy of the Order of 9 November 1990 initiatives were immediately undertaken to fashion out a return-to-work agreement with management, still, the unrebutted evidence remains that the striking union officers and members tried to return to work only eleven (11) days after the conciliation meetings ended in failure, or twenty (20) days after they received copy of the first return-to-work order on 5 November 1990. The sympathy of the Court which, as a rule, is on the side of the laboring classes (Reliance Surety & Insurance Co., Inc. v. NLRC), 13 cannot be extended to the striking union officers and members in the instant petition. There was willful disobedience not only to one but two return-to-work orders. Considering that the UNION consisted mainly of teachers, who are supposed to be well-lettered and well-informed, the Court cannot overlook the plain arrogance and pride displayed by the UNION in this labor dispute. Despite containing threats of disciplinary action against some union officers and members who actively participated in the strike, the letter dated 9 November 1990 sent by the COLLEGE enjoining the union officers and members to return to work on 12 November 1990 presented the workers an opportunity to return to work under the same terms and conditions prior to the strike. Yet, the UNION decided to ignore the same. The COLLEGE, correspondingly, had every right to terminate the services of those who chose to disregard the return-to-work orders issued by respondent SECRETARY in order to protect the interests of its students who form part of the youth of the land. Lastly, the UNION officers and members also argue that the doctrine laid down in Sarmiento v. Tuico, supra, and Union of Filipro Employees v. Nestle’ Philippines, Inc., supra, cannot be made applicable to them because in the latter two cases, workers defied the return-to-work orders for more than five (5) months. Their defiance of the return-to-work order, it is said, did not last more than a month. Again, this line of argument must be rejected. It is clear from the provisions above quoted that from the moment a worker defies a return-to-work order, he is deemed to have abandoned his job. It is already in itself knowingly participating in an illegal act. Otherwise, the worker will just simply refuse to return to his work and cause a standstill they refused to discharge or allow the management to fill (Sarmiento v. Tuico, supra). Suffice it to say, in Federation of Free Workers v. Inciong, supra, the workers were terminated from work after defying the return-to-work order for only nine (9) days. It is indeed inconceivable that an employee, despite a return-to-work order, will be allowed in the interim to stand akimbo and wait until five (5) orders shall have been issued for their return before they report back to work. This is absurd. In fine, respondent SECRETARY gravely abused his discretion when he ordered the reinstatement of striking union members who refused to report back to work after he issued two (2) return-to-work orders, which in itself is knowingly participating in an illegal act. The Order in question is, certainly, contrary to existing law and jurisprudence. WHEREFORE, the Petition for Certiorari is hereby GRANTED. The Order of 12 April 1991 and the Resolution of 31 May 1991 both issued by respondent Secretary of Labor and Employment are SET ASIDE insofar as they order the reinstatement of striking union members terminated by petitioner, and the temporary restraining order We issued on June 26, 1991, is made permanent. No costs. SO ORDERED.

v. G.R. No. 169632

March 28, 2006

UNIVERSITY OF SAN AGUSTIN EMPLOYEES’ UNION-FFW (USAEU-FFW), and individual union officers THEODORE NEIL LASOLA, MERLYN JARA, JULIUS MARIO, FLAVIANO MANALO, RENE CABALUM, HERMINIGILDO CALZADO, MA. LUZ CALZADO, RAY ANTHONY ZUÑIGA, RIZALENE VILLANUEVA, RUDANTE DOLAR, ROVER JOHN TAVARRO, RENA LETE, ALFREDO GORIONA, RAMON VACANTE and MAXIMO MONTERO, Petitioners, vs. THE COURT OF APPEALS and UNIVERSITY OF SAN AGUSTIN, Respondents. DECISION GARCIA, J.: By this petition for review on certiorari, petitioners University of San Agustin Employees’ Union-FFW (Union) and its officers seek to reverse and set aside the Partially Amended Decision1 of the Court of Appeals (CA) dated August 23, 2005 in CA-G.R.SP No. 85317, reversing the Decision and Resolution of the Secretary of Labor and Employment (SOLE) dated April 6, 2004 and May 24, 2004, respectively. The assailed CA decision declared the strike conducted by the petitioner Union, illegal, and consequently, the co-petitioner union officers were deemed to have lost their employment status. It further vacated the SOLE’s resolution of the economic issues involved in the case and directed the parties to resort to voluntary arbitration in accordance with the grievance machinery as embodied in their existing collective bargaining agreement (CBA). The facts:

Respondent University of San Agustin (University) is a non-stock, non-profit educational institution which offers both basic and higher education courses. Petitioner Union is the duly recognized collective bargaining unit for teaching and non-teaching rank-and-file personnel of the University while the other individual petitioners are its officers. On July 27, 2000, the parties entered into a 5-year CBA2 which, among other things, provided that the economic provisions thereof shall have a period of three (3) years or up to 2003. Complementary to said provisions is Section 3 of Article VIII of the CBA providing for salary increases for School Years (SY) 2000-2003, such increase to take the form of either a lump sum or a percentage of the tuition incremental proceeds (TIP). The CBA contained a "no strike, no lockout" clause and a grievance machinery procedure to resolve management-labor disputes, including a voluntary arbitration mechanism should the grievance committee fail to satisfactorily settle such disputes. Pursuant to the CBA, the parties commenced negotiations for the economic provisions for the remaining two years, i.e., SY2003-2004 and SY2004-2005. During the negotiations, the parties could not agree on the manner of computing the TIP, thus the need to undergo preventive mediation proceedings before the National Conciliation and Mediation Board (NCMB), Iloilo City. The impasse respecting the computation of TIP was not resolved. This development prompted the Union to declare a bargaining deadlock grounded on the parties’ failure to arrive at a mutually acceptable position on the manner of computing the seventy percent (70%) of the net TIP to be allotted for salary and other benefits for SY2003-2004 and SY2004-2005. Thereafter, the Union filed a Notice of Strike before the NCMB which was expectedly opposed by the University in a Motion to Strike Out Notice of Strike and to Refer the Dispute to Voluntary Arbitration,3 invoking the "No strike, no lockout" clause4 of the parties’ CBA. The NCMB, however, failed to resolve the University’s motion. The parties then made a joint request for the SOLE to assume jurisdiction over the dispute. The labor dispute was docketed as OS-AJ-0032-2003. On September 18, 2003, an Assumption of Jurisdiction Order5 (AJO) was issued by the SOLE, thus: WHEREFORE, this Office hereby ASSUMES JURISDICTION over the labor dispute at the UNIVERSITY OF SAN AGUSTIN, pursuant to Article 263(g) of the Labor Code, as amended. ACCORDINGLY, any strike or lockout whether actual or intended, is hereby strictly enjoined and the parties are directed to cease and desist from committing any act that might exacerbate the situation. Finally, to expedite resolution of the dispute, the parties are directed to submit their respective position papers and evidence to this Office within TEN (10) calendar days from receipt hereof, with proof of service to the other party. REPLY thereto shall be submitted with proof of service to the other party, within five (5) calendar days from receipt of the other party’s POSITION PAPER. On September 19, 2003, the Union staged a strike. At 6:45 a.m. of the same day, Sheriffs Francisco L. Reyes and Rocky M. Francisco had arrived at San Agustin University to serve the AJO on the Union. At the main entrance of the University, the sheriffs saw some elements of the Union at the early stages of the strike. There they met Merlyn Jara, the Union’s vice president, upon whom the sheriffs tried to serve the AJO, but who, after reading it, refused to receive the same, citing Union Board Resolution No. 3 naming the union president as the only person authorized to do so. The sheriffs explained to Ms. Jara that even if she refused to acknowledge receipt of the AJO, the same would be considered served. Sheriff Reyes further informed the Union that once the sheriffs post the AJO, it would be considered received by the Union.6 At approximately 8:45 a.m., the sheriffs posted copies of the AJO at the main gate of San Agustin University, at the main entrance of its buildings and at the Union’s office inside the campus. At 9:20 a.m., the sheriffs served the AJO on the University. Notwithstanding the sheriffs’ advice as to the legal implication of the Union’s refusal to be served with the AJO, the Union went ahead with the strike. At around 5:25 p.m., the Union president arrived at the respondent University’s premises and received the AJO from the sheriffs. On September 24, 2003, the University filed a Petition to Declare Illegal Strike and Loss of Employment Status 7 at the National Labor Relations Commission (NLRC) Sub-regional Arbitration Branch No. VI in Iloilo City. The case was docketed as NLRC SRAB Case No. 06-09-50370-03, which the University later on requested to be consolidated with OS-AJ-0032-2003 pending before the SOLE. The motion for consolidation was granted by the Labor Arbiter in an Order dated November 7, 2003.8 On April 6, 2004, the SOLE rendered a Decision9 resolving the various economic issues over which the parties had a deadlock in the collective bargaining, including the issue of legality/illegality of the September 19, 2003 strike. Dispositively, the decision reads: WHEREFORE, the parties are hereby directed to conclude a memorandum of agreement embodying the foregoing dispositions to be appended to the current CBA. The petition to declare the strike illegal is hereby DISMISSED for want of legal and factual basis. Consequently, there is no basis whatsoever to declare loss of employment status on the part of any of the striking union members. SO ORDERED. The University moved for a reconsideration of the said decision but its motion was denied by the SOLE in a Resolution10 of May 24, 2004. In time, the University elevated the matter to the CA by way of a petition for certiorari, thereat docketed as CA-G.R. SP No. 85317.

On March 4, 2005, the CA rendered a Decision11 partially granting the University’s petition. While the CA affirmed the rest of the SOLE’s decision on the economic issues, particularly the formula to be used in computing the share of the employees in the tuition fee increase for Academic Year 2003-2004, it, however, reversed the SOLE’s ruling as to the legality of the September 19, 2003 strike, to wit: WHEREFORE, the foregoing premises considered, the petition is hereby partially GRANTED. The assailed Decision of the public respondent SOLE is hereby MODIFIED to the effect that the strike held by the [petitioners] on September 19, 2003 is illegal. Hence, the union officers are deemed to have lost their employment status. The assailed Decision however, is AFFIRMED in all other respects. SO ORDERED. (Word in bracket added). Both parties filed their respective motions for partial reconsideration of the aforestated decision, the University excepting from the CA’s decision insofar as the latter affirmed the SOLE’s resolution of the economic issues. On the other hand, the Union sought reconsideration of the CA’s finding of illegality of the September 19, 2003 strike. In the meantime, on April 7, 2005, the University served notices of termination to the union officers who were declared by the CA as deemed to have lost their employment status. On the same day – April 7, 2005 – in response to the University’s action, the Union filed with the NCMB a second notice of strike, this time on ground of alleged union busting. On April 22, 2005, the parties again took initial steps to negotiate the new CBA but said attempts proved futile. Hence, on April 25, 2005, the Union went on strike. In reaction, the University notified the Union that it was pulling out of the negotiations because of the strike. On August 23, 2005, the CA, acting on the parties’ respective motions for reconsideration, promulgated the herein challenged Partially Amended Decision.12 Finding merit in the respondent University’s motion for partial reconsideration, the CA ruled that the SOLE abused its discretion in resolving the economic issues on the ground that said issues were proper subject of the grievance machinery as embodied in the parties’ CBA. Consequently, the CA directed the parties to refer the economic issues of the CBA to voluntary arbitration. The CA, however, stood firm in its finding that the strike conducted by the petitioner Union was illegal and its officers were deemed to have lost their employment status. Dispositively, the decision reads: WHEREFORE, in view of all the foregoing premises, an amended judgment is hereby rendered by us GRANTING the petition for certiorari, SETTING ASIDE our original decision in this case which was promulgated on March 4, 2005, SETTING ASIDE also the Decision rendered by the public respondent SOLE on April 6, 2004 and DECLARING the strike held on September 19, 2003 by the [petitioner] Union as ILLEGAL. The union officers are therefore deemed to have lost their employment status. The parties are hereby DIRECTED to refer the economic issues of the CBA to VOLUNTARY ARBITRATION, where the computation and determination of the TIP shall be in the manner directed in the body of this Decision. SO ORDERED. On September 20, 2005, the Union and its dismissed officers filed the instant petition raising the following basic issues: I THE HONORABLE COURT OF APPEALS GRAVELY ERRED AND COMMITTED GRAVE ABUSE OF DISCRETION IN DECLARING ILLEGAL THE STRIKE OF THE PETITIONERS ON SEPTEMBER 19, 2003 AND IN DECLARING THE UNION OFFICERS AS DEEMED TO HAVE LOST THEIR EMPLOYMENT STATUS FOR THE ALLEGED FAILURE OF THE PETITIONERS TO IMMEDIATELY RETURN TO THEIR WORK WHEN THE ASSUMPTION OF JURISDICTION ORDER WAS DEEMED SERVED UPON THEM BY THE DOLE SHERIFFS AS OF 8:45 IN THE MORNING OF THAT DATE, WHEN, IN CASES WHERE THE STRIKE HAS ALREADY COMMENCED, THE SECRETARY OF LABOR AND EMPLOYMENT (SOLE) ALWAYS GIVES TWENTY-FOUR HOURS TO THE STRIKING WORKERS WITHIN WHICH TO RETURN TO WORK, AND TAKING INTO CONSIDERATION THE TOTALITY OF THE CONDUCT OF THE STRIKERS, AS WHAT THE SOLE HAD DONE, THE PETITIONERS HAVE NOT MANIFESTED NAKED DISPLAY OF RECALCITRANCE NOR SHOWN BAD FAITH TO THE RESPONDENT UNIVERSITY. II THE HONORABLE COURT OF APPEALS GRAVELY ERRED AND COMMITTED GRAVE ABUSE OF DISCRETION IN DIRECTING TO REFER THE ECONOMIC ISSUES OF THE LABOR DISPUTE TO VOLUNTARY ARBITRATION WHEN IT IS SETTLED BY JURISPRUDENCE THAT "THE LABOR SECRETARY’S AUTHORITY TO ASSUME JURISDICTION OVER A LABOR DISPUTE MUST INCLUDE AND EXTEND TO ALL QUESTIONS AND CONTROVERSIES ARISING THEREFROM, EVEN INCLUDING CASES OVER WHICH THE LABOR ARBITER HAS EXCLUSIVE JURISDICTION." Prefatorily, we restate the time-honored principle that in petitions for review under Rule 45 of the Rules of Court, only questions of law may be raised. It is not our function to analyze or weigh all over again evidence already considered in the proceedings below, our jurisdiction being limited to reviewing only errors of law that may have been committed by the lower court.13 The resolution of factual issues is the function of lower courts, whose findings on these matters are received with respect. A question of law which we may pass upon must not involve an examination of the probative value of the evidence presented by the litigants.14 Here, however, the findings of fact of the CA are not in accord with the conclusions made by the SOLE regarding the legality of the subject strike. Consequently, we are compelled to make our own assessment of the evidence on record insofar as the strike issue is concerned.

We find the CA’s conclusions to be well supported by evidence, particularly the Sheriff’s Report.15 As we see it, the SOLE was remiss in disregarding the sheriff’s report. It bears stressing that said report is an official statement by the sheriff of his acts under the writs and processes issued by the court, in this case, the SOLE, in obedience to its directive and in conformity with law. In the absence of contrary evidence, a presumption exists that a sheriff has regularly performed his official duty. To controvert the presumption arising therefrom, there must be clear and convincing evidence. The sheriff’s report unequivocally stated the union officers’ refusal to receive the AJO when served on them in the morning of September 19, 2003. The September 16, 2003 Union’s Board Resolution No. 3 which gave sole authority to its president to receive the AJO must not be allowed to circumvent the standard operating procedure of the Office of the Undersecretary for Labor Relations which considers AJOs as duly served upon posting of copies thereof on designated places. The procedure was adopted in order to prevent the thwarting of AJOs by the simple expedient of refusal of the parties to receive the same, as in this case. The Union cannot feign ignorance of this procedure because its counsel Atty. Mae M. Gellecanao-Laserna was a former Regional Director of the Department of Labor and Employment (DOLE). To be sure, the Union was not able to sufficiently dispute the truth of the narration of facts contained in the sheriff’s report. Hence, it was not unreasonable for the CA to conclude that there was a deliberate intent by the Union and its officers to disregard the AJO and proceed with their strike, which, by their act of disregarding said AJO made said strike illegal. The AJO was issued by the SOLE pursuant to Article 263(g) of the Labor Code, which reads: Art. 263. Strikes, picketing, and lockouts. - … (g) When, in his opinion, there exists a labor dispute causing or likely to cause a strike or lockout in an industry indispensable to the national interest, the Secretary of Labor and Employment may assume jurisdiction over the dispute and decide it or certify the same to the Commission for compulsory arbitration. Such assumption or certification shall have the effect of automatically enjoining the intended or impending strike or lockout as specified in the assumption or certification order. If one has already taken place at the time of assumption or certification, all striking or locked out employees shall immediately return to work and the employer shall immediately resume operations and readmit all workers under the same terms and conditions prevailing before the strike or lockout. The Secretary of Labor and Employment or the Commission may seek the assistance of law enforcement agencies to ensure compliance with this provision as well as with such orders as he may issue to enforce the same. (Emphasis supplied). Conclusively, when the SOLE assumes jurisdiction over a labor dispute in an industry indispensable to national interest or certifies the same to the NLRC for compulsory arbitration, such assumption or certification shall have the effect of automatically enjoining the intended or impending strike or lockout. Moreover, if one had already taken place, all striking workers shall immediately return to work and the employer shall immediately resume operations and readmit all workers under the same terms and conditions prevailing before the strike or lockout. In Trans-Asia Shipping Lines, Inc., et al. vs. CA, et al.,16 the Court declared that when the Secretary exercises these powers, he is granted great breadth of discretion in order to find a solution to a labor dispute. The most obvious of these powers is the automatic enjoining of an impending strike or lockout or the lifting thereof if one has already taken place. Assumption of jurisdiction over a labor dispute, or the certification of the same to the NLRC for compulsory arbitration, always co-exists with an order for workers to return to work immediately and for employers to readmit all workers under the same terms and conditions prevailing before the strike or lockout. In this case, the AJO was served at 8:45 a.m. of September 19, 2003. The strikers then should have returned to work immediately. However, they persisted with their refusal to receive the AJO and waited for their union president to receive the same at 5:25 p.m. The Union’s defiance of the AJO was evident in the sheriff’s report: We went back to the main gate of the University and there NCMB Director Dadivas introduced us to the Union lawyer, Atty. Mae Lacerna a former DOLE Regional Director. Atty. Lacerna however refused to be officially served the Order again pointing to Board Resolution No. 3 passed by the Union officers. Atty. Lacerna then informed the undersigned Sheriffs that the Union president will accept the Order at around 5:00 o’clock in the afternoon. Atty. Lacerna told the undersigned Sheriff that only when the Union president receives the Order at 5:00 p.m. shall the Union recognize the Secretary of Labor as having assumed jurisdiction over the labor dispute.17 Thus, we see no reversible error in the CA’s finding that the strike of September 19, 2003 was illegal. Consequently, the Union officers were deemed to have lost their employment status for having knowingly participated in said illegal act. The Union’s assertion of a well settled practice that the SOLE always gives twenty-four hours (24) to the striking workers within which to return to work, offers no refuge. Aside from the fact that this alleged well settled practice has no basis in law and jurisprudence, Article 263(g) of the Labor Code, supra, is explicit that if a strike has already taken place at the time of assumption of jurisdiction or certification, all striking or locked out employees shall immediately return to work and the employer shall immediately resume operations and readmit all workers under the same terms and conditions prevailing before the strike or lock-out. This is compounded further by this Court’s rulings which have never interpreted the phrase "immediately return to work" found in Article 263(g) to mean "within twenty four (24) hours." On the other hand, the tenor of these ponencias18 indicates an almost instantaneous or automatic compliance for a striker to return to work once an AJO has been duly served. We likewise find logic in the CA’s directive for the herein parties to proceed with voluntary arbitration as provided in their CBA. As we see it, the issue as to the economic benefits, which included the issue on the formula in computing the TIP share of the employees, is one that arises from the interpretation or implementation of the CBA. To be sure, the parties’ CBA provides for a grievance machinery to resolve any "complaint or dissatisfaction arising from the interpretation or implementation of the CBA and those arising from the interpretation or enforcement of company personnel policies."19 Moreover, the same CBA provides that should the grievance machinery fail to resolve the grievance or dispute, the same shall be "referred to a Voluntary Arbitrator for arbitration and final resolution."20However, through no fault of the University these processes were not exhausted. It must be recalled that while undergoing preventive mediation proceedings before the NCMB, the Union declared a bargaining deadlock, filed a notice of strike and thereafter, went on strike. The University filed a Motion to Strike Out Notice of Strike and to Refer the Dispute to Voluntary Arbitration21 but the motion was not acted upon by the NCMB. As borne by the records, the University has been consistent in its position that the Union must exhaust the grievance machinery provisions of the CBA which ends in voluntary arbitration. The University’s stance is consistent with Articles 261 and 262 of the Labor Code, as amended which respectively provide: 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. Accordingly, 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 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. The Commission, its Regional Offices and the Regional Directors of the Department of Labor and Employment shall not entertain disputes, grievances or matters under the exclusive and original jurisdiction of the voluntary arbitrator or panel of voluntary arbitrators and shall immediately dispose and refer the same to the grievance machinery or voluntary arbitration provided in the collective bargaining agreement.

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. The grievance machinery and no strike, no lockout22 provisions of the CBA forged by the University and the Union are founded on Articles 261 and 262 quoted above. The parties agreed that practically all disputes – including bargaining deadlocks – shall be referred to the grievance machinery which ends in voluntary arbitration. Moreover, no strike or no lockout shall ensue while the matter is being resolved. The University filed a Motion to Strike Out Notice of Strike and Refer the Dispute to Voluntary Arbitration23 precisely to call the attention of the NCMB and the Union to the fact that the CBA provides for a grievance machinery and the parties’ obligation to exhaust and honor said mechanism. Accordingly, the NCMB should have directed the Union to honor its agreement with the University to exhaust administrative grievance measures and bring the alleged deadlock to voluntary arbitration. Unfortunately, the NCMB did not resolve the University’s motion thus paving the way for the strike on September 19, 2003 and the deliberate circumvention of the CBA’s grievance machinery and voluntary arbitration provisions. As we see it, the failure or refusal of the NCMB and thereafter the SOLE to recognize, honor and enforce the grievance machinery and voluntary arbitration provisions of the parties’ CBA unwittingly rendered said provisions, as well as, Articles 261 and 262 of the Labor Code, useless and inoperative. As here, a union can easily circumvent the grievance machinery and a previous agreement to resolve differences or conflicts through voluntary arbitration through the simple expedient of filing a notice of strike. On the other hand, management can avoid the grievance machinery and voluntary arbitration provisions of its CBA by simply filing a notice of lockout. In Liberal Labor Union vs. Philippine Can Company,24 the Court viewed that the main purpose of management and labor in adopting a procedure in the settlement of their disputes is to prevent a strike or lockout. Thus, this procedure must be followed in its entirety if it is to achieve its objective. Accordingly, the Court in said case held: The authorities are numerous which hold that strikes held in violation of the terms contained in a collective bargaining agreement are illegal, specially when they provide for conclusive arbitration clauses. These agreements must be strictly adhered to and respected if their ends have to be achieved. It is noteworthy that in Liberal, management refused to submit names in connection with the formation of the grievance committee. Yet, the Court ruled in that case that labor still had no right to declare a strike, for its duty is to exhaust all available means within its reach before resorting to force. In the case at bench, the University, in filing its Motion to Strike Out Notice of Strike and to Refer the Dispute to Voluntary Arbitration before the NCMB, was insisting that the Union abide by the parties’ CBA’s grievance machinery and voluntary arbitration provisions. With all the more reasons then should the Union be directed to proceed to voluntary arbitration. We are not unmindful of the Court’s ruling in International Pharmaceuticals, Inc. vs. Secretary of Labor, et al.,25 that the SOLE’ s jurisdiction over labor disputes must include and extend to all questions and controversies arising therefrom, including cases over which the Labor Arbiter has exclusive jurisdiction. However, we are inclined to treat the present case as an exception to that holding. For, the NCMB’s inaction on the University’s motion to refer the dispute to voluntary arbitration veritably forced the hand of the University to seek and accordingly submit to the jurisdiction of the SOLE. Considering that the CBA contained a no strike, no lockout and grievance machinery and voluntary arbitration clauses, the NCMB, under its very own Manual of Procedures in the Settlement and Disposition of Conciliation and Preventive Mediation Cases, should have declared as not duly filed the Union’s Notice of Strike and thereafter, should have referred the labor dispute to voluntary arbitration pursuant to Article 261, supra, of the Labor Code. For sure, Section 6(c)(i), Rule VI, of the NCMB’s Manual specifically provides: Section 6. Action on non-strikeable issues - A strike or lockout notice anchored on grounds involving (1) inter-union or intra-union disputes (2) violation of labor standard laws (3) pending cases at the DOLE Regional Offices, BLR, NLRC and its appropriate Regional Branches, NWPC and its Regional Wage Boards, Office of the Secretary, Voluntary Arbitrator, Court of Appeals and the Supreme Court (4) execution and enforcement of final orders, decisions, resolutions or awards of no. (3) above shall be considered not duly filed and the party so filing shall be notified of such finding in writing by the Regional Branch Director. On his part, the Conciliator-Mediator shall convince the party concerned to voluntarily withdraw the notice without prejudice to further conciliation proceedings. Otherwise, he shall recommend to the Regional Branch Director that the notice be treated as a preventive mediation case. xxx xxx xxx xxx xxx xxx c. Action on Notices Involving Issues Cognizable by the Grievance Machinery, Voluntary Arbitration or the National Labor Relations Commission. i) Disputes arising from the interpretation or implementation of a collective bargaining agreement or from the interpretation or enforcement of company personnel policies shall be referred to the grievance machinery as provided for under Art. 261 of the Labor Code xxx (Emphasis supplied). As quoted earlier, Article 261 of the Labor Code mentioned in the aforequoted Section 6(c)(i), Rule VI of the NCMB Manual refers to the jurisdiction of voluntary arbitrator or panel of voluntary arbitrators "to hear and decide all unresolved grievances arising from the interpretation or implementation of the CBA and those arising from the interpretation or enforcement of company personnel policies," hence "violations of a CBA, except those which are gross in character, shall no longer be treated as unfair labor practice and shall be resolved as grievances under the CBA." The same Article further states that the "Commission, its Regional Offices and the Regional Directors of the Department of Labor and Employment (DOLE) shall not entertain disputes, grievances or matters under the exclusive and original jurisdiction of the Voluntary Arbitrator or panel of Voluntary Arbitrators and shall immediately dispose and refer the same to the Grievance Machinery or Voluntary Arbitration provided in the CBA." As it were, Article 261 of the Labor Code, in relation to Section 6(c)(i), Rule VI of the NCMB Manual, provides the manner in which the NCMB must resolve notices of strike that involve non-strikeable issues. And whether the notice of strike or lockout involves inter-union or intra-union disputes, violation of labor standards laws or issues cognizable by the grievance machinery, voluntary arbitration or the NLRC, the initial step is for the NCMB to consider the notice of strike as not duly filed. Centering on disputes arising from the interpretation or implementation of a CBA or from the interpretation or enforcement of company personnel policies, following Section 6(c)(i), Rule VI, supra, of the NCMB Manual, after the declaration that the notice of strike is "not duly filed," the labor dispute is to be referred to voluntary arbitration pursuant to Article 261, supra, of the Labor Code.

In short, the peculiar facts of the instant case show that the University was deprived of a remedy that would have enjoined the Union strike and was left without any recourse except to invoke the jurisdiction of the SOLE. Following Liberal, this Court will not allow the no strike, no lockout, grievance machinery and voluntary arbitration clauses found in CBAs to be circumvented by the simple expedient of filing of a notice of strike or lockout. A similar circumvention made possible by the inaction of the NCMB on the University’s Motion to Strike Out Notice of Strike and to Refer the Dispute to Voluntary Arbitration will not be countenanced. To rule otherwise would render meaningless Articles 261 and 262 of the Labor Code, as amended, as well as the voluntary arbitration clauses found in CBAs. All told, we find no reversible error committed by the CA in rendering its assailed decision. WHEREFORE, the petition is DENIED. The Partially Amended Decision dated August 23, 2005 of the Court of Appeals in CA-G.R. SP No. 85317 is AFFIRMED. SO ORDERED.

w. [G.R. No. L-25003. October 23, 1981.] LIWAYWAY PUBLICATIONS, INC., Plaintiff-Appellee, v. PERMANENT CONCRETE WORKERS UNION, Affiliated with the NATIONAL ASSOCIATION OF TRADE UNIONS, HERMOGENES ATRAZO, AQUILINO DISTOR, BENJAMIN GUTIERREZ, JOSE RAMOS, TIBURCIO MARDO, ERNESTO ALMARIO and DOMINGO LEANO, Defendants-Appellants. Aladdin F. Trinidad for Plaintiff-Appellee. Marcelino Lontok Jr., for Defendants-Appellants. SYNOPSIS While a labor dispute between defendant-appellant union and Permanent Concrete Products, Inc. was pending before the Court of Industrial Relations, the Court of First Instance of Manila issued in an action for damages filed by the plaintiff-appellee Liwayway Publications, Inc. a writ of preliminary injunction against appellant union which picketed and prevented entrance to the gate leading to the bodega of appellee and threatened its officers and employees despite the fact that the appellee is not in anyway related to the striking union but a mere sublessee of said bodega in the compound of Permanent Concrete Products, Inc. against whom the strike was staged. Appellant union filed a motion to dismiss and motion to dissolve the writ on the ground that only the Court of Industrial Relations and not the Court of First Instance has exclusive jurisdiction over the labor dispute; that the appellee has no cause of action against the striking union but against the lessor; and that plaintiffappellee is not the real party in interest but Permanent Concrete Products, Inc. The lower court denied the motion for lack of labor dispute between the plaintiff and defendant of which the Court of Industrial Relations may take cognizance and rendered a decision declaring the writ permanent and ordering the payment of damages, attorney’s fees and costs. On appeal, the Supreme Court in upholding the jurisdiction of the lower court to issue the writ of preliminary injunction, ruled that: (a) there is no connection between the appellee, the appellant union and the Permanent Concrete Products, Inc. and the fact, that the latter and appellee are situated in the same premises, can hardly be considered as interwoven with the labor dispute pending with the Court of Industrial Relations; and (b) the acts of the striking union are mere acts of trespass for which the lessee shall have a direct action against the trespasser. Decision appealed from, affirmed in toto.

SYLLABUS

1. CONSTITUTIONAL LAW; BILL OF RIGHTS; FREEDOM OF SPEECH GUARANTEED BY THE CONSTITUTIONAL RIGHT TO PICKET, A PHASE THEREOF. — "The right to picket as a means of communicating the facts of a labor dispute is a phase of the freedom of speech guaranteed by the constitution. If peacefully carried out, it cannot be curtailed even in the absence of employer- employee relationship. The right is, however, not an absolute one. While peaceful picketing is entitled to protection as an exercise of free speech, we believe that courts are not without power to confine or localize the sphere of communication or the demonstration to the parties to the labor dispute, including those with related interest, and to insulate establishments or persons with no industrial connection or having interest totally foreign to the context of the dispute. Thus, the fight may he regulated at the instance of third parties or `innocent bystanders’ if it appears that the inevitable result of its exercise is to create an impression that a labor dispute with which they have no connection or interest exists between them and the picketing union or constitute an invasion of their rights. . . . (Phil. Association of Free Labor Unions [PAFLU] v. Judge Gaudencio Cloribel, Et Al., L-25878, March 24, 1969, 27 SCRA 465, 472) 2. REMEDIAL LAW; PROVISIONAL REMEDIES; PRELIMINARY INJUNCTION; COURT HAVING JURISDICTION TO ISSUE THE WRIT; DETERMINED BY NATURE OF CONTROVERSY; CASE AT BAR. — In Phil. Association of Free Labor Union, Et. Al. v. Tan, 99 Phil. 854, it was held: "with regard to activities that may be enjoined, in order to ascertain what court has jurisdiction to issue the injunction, it is necessary to determine the nature of the controversy." (Italics supplied) There is no connection between the appellee Liwayway Publications, Inc. and the striking union, nor with the company against whom the strikers staged the strike, and neither are the acts of the driver of the appellee, its general manager, personnel manager, the man in charge of the bodega and other employees of the appellee in reaching the bodega to obtain newsprint therefrom to feed and supply its publishing business interwoven with the labor dispute between the striking Union and the Permanent Concrete Products company. If there is a connection between appellee publishing company and the Permanent Concrete Products company, it is that both are situated in the same premises, which can hardly be considered as interwoven with the labor dispute pending in the Court of Industrial Relations between the strikers and their employer. 3. CIVIL LAW; LEASE; OBLIGATION OF LESSOR TO MAINTAIN LESSEE IN PEACEFUL ENJOYMENT OF THE LEASE; NOT APPLICABLE TO MERE ACTS OF TRESPASS ON LEASED PREMISES; CASE AT BAR. — The contention that appellee publishing company should have brought its complaint for damages it incurred when its employees were prevented from getting their daily supply of newsprint from its bodega, against the first lessee and not against the appellant Union, as under Article 1654 of the New Civil Code the lessor is obliged, among others, to maintain the lessee in the peaceful and adequate enjoyment of the lease for the entire duration of the contract, is not in point. The acts complained of against the striking union members are properly called mere acts of trespass which falls squarely under the provisions of Article 1664 of the New Civil Code, such that following the doctrine laid down in Goldstein v. Roces, 34 Phil. 562, the lessor shall not be obliged to answer for the mere fact of a trespass made by a third person in the use of the estate leased but the lessee shall have a direct action against the trespasser. 4. ID.; ID.; ID.; APPLICABLE ONLY TO ACTS CONSTITUTING LEGAL TRESPASS. — The obligation of the lessor under Article 1654, New Civil Code, to maintain the lessee in the peaceful and adequate enjoyment of the lease for the entire duration of the contract arises only when acts, termed as legal trespass (perturbacion de derecho), disturb, dispute, object to, or place difficulties in the way of the lessee’s peaceful enjoyment of the premises that in some manner or other case doubt upon the right of the lessor by virtue of which the lessor himself executed the lease, in which case the lessor is obliged to answer for said act of trespass. 5. ID.; ID.; ID.; SIMPLE AND LEGAL TRESPASS, DISTINGUISHED. — "Briefly, if the act of trespass is not accompanied or preceded by anything which reveals a really

juridic intention on the part of the trespasser, in such wise that the lessee can only distinguish the material fact, stripped of all legal form or reasons, it is understood to be trespass in fact only (de mero hecho)." (Goldstein v. Roces. supra).

DECISION

GUERRERO, J.:

This is an appeal from the decision of the Court of First Instance of Manila declaring permanent the writ of preliminary injunction issued in this case and condemning the defendants (herein appellants) to pay plaintiff (herein appellee), the amount of P10,152.42 with interest thereon at the legal rate from the commencement of this action until fully paid, P1,000.00 as attorney’s fees and costs. The case commenced when Liwayway Publications, Inc. brought an action in the CFI-Manila against Permanent Concrete Workers Union, Et. Al. for the issuance of a writ of preliminary injunction and for damages it incurred when its employees were prevented from getting their daily supply of newsprint from its bodega. Plaintiff alleged that it is a second sublessee of a part of the premises of the Permanent Concrete Products, Inc. at 1000 Cordeleria Street, Sta. Mesa, Manila from Don Ramon Roces, a first lessee from the aforesaid company. The premises of the plaintiff is separated from the compound of Permanent Concrete Products, Inc. by a concrete and barbed wire fence with its own entrance and road leading to the national road. This entrance is separate and distinct from the entrance road of the Permanent Concrete Products, Inc. 1 Plaintiff further alleged that it has a bodega for its newsprints in the sublet property which it uses for its printing and publishing business. The daily supply of newsprint needed to feed its printing plant is taken from this bodega. On September 10, 1964, the employees of the Permanent Concrete Products, Inc. who are representatives and members of the defendant union declared a strike against their company. chanrobles law lib rary

On October 3, 1964 for unknown reasons and without legal justification, Permanent Concrete Workers Union and its members picketed, stopped and prohibited plaintiff’s truck from entering the compound to load newsprint from its bodega. The union members intimidated and threatened with bodily harm the employees who were in the truck. On October 6, 1964, union members stopped and prohibited the general manager, personnel manager, bodega in-charge and other employees of the plaintiff from getting newsprint in their bodega. 2 Plaintiff made repeated demands to the defendants not to intimidate and threaten its employees with bodily harm and not to blockade, picket or prohibit plaintiff’s truck from getting newsprint in their bodega. Defendants refused and continued to refuse to give in to the demands of the plaintiff. As a consequence thereof, plaintiff rented another bodega during the time members of the defendant union prevented its employees from entering its bodega in the compound of Permanent Concrete Products, Inc. and thus incurred expenses both in terms of bodega rentals and in transporting newsprint from the pier to the temporary bodega. On December 14, 1964, the lower court issued a writ of preliminary injunction enjoining the defendants from:

chanrob1e s vi rtual 1aw lib rary

(a) threatening and intimidating plaintiff’s executive officers and their representatives, who are going to its bodega as well as its employees who are getting newsprint from it; (b) ordering the defendants and their representatives not to blockade and/or picket the compound and the gate of the plaintiff; (c) ordering the defendants not to stop, prohibit, molest and interfere with the free passage of the plaintiff in going in and out of the bodega. Defendant union moved to dismiss the complaint on the following grounds:

chanrobles vi rtua l lawlib ra ry

1. That this case arose out of a labor dispute involving unfair labor practices and, therefore, the Court of First Instance where this action was brought has no jurisdiction to issue an injunction since this case falls within the exclusive jurisdiction of the Court of Industrial Relations; 2. That plaintiff is not the real party in interest in whose name the present action may be prosecuted in accordance with Section 2, Rule 3 of the Rules of Court. On the first ground, defendants argued that the Court of Industrial Relations is vested with the exclusive power to issue injunctions in labor disputes involving unfair labor practices and that in the long line of decisions, the Supreme Court has repeatedly held that ordinary courts do not have jurisdiction to issue an injunction in any labor dispute particularly when the Court of Industrial Relations has already acquired jurisdiction over it. As to the second ground, defendants argue that the real party in interest in this case is the Permanent Concrete Products, Inc. against whom the defendants’ strike and picket activities were directed and confined, and they point to cases between the real parties in interest, namely: Permanent Concrete Products, Inc. on one hand and the Permanent Concrete Workers Union on the other, pending before the Court of Industrial Relations docketed therein as CIR Case No. 156-Inj., Charge 212-ULP and Charge No. 1414-M.C. Plaintiff Liwayway Publications, Inc. opposed the motion, alleging that:

chan rob1es v irt ual 1aw l ibra ry

1. There is no employer-employee relationship between the plaintiff and the defendant; 2. There is no labor dispute between them; 3. Plaintiff’s compound is separate and distinct from the compound of the company where the defendants are employed. Defendants by way of reply to the abovementioned opposition argued that even if there was no employer-employee relationship, still the Court of First Instance would have no jurisdiction to issue an injunction, citing several cases holding that there could be a labor dispute regardless of whether or not the disputants stand in proximate relation of employer and employee and that peaceful picketing is an extension of the freedom of speech guaranteed by the Constitution, 3 a fundamental right granted to labor which cannot be enjoined. Since plaintiff averred in its complaint that "it is a second sublessee of a part of the premises of the Permanent Concrete Products, Inc. at 1000 Cordeleria Street, Sta. Mesa, Manila from Don Ramon Roces, first lessee from the aforementioned company, defendants contend that plaintiff has no cause of action against them but against Don Ramon Roces under the provisions of Article 1654 of the New Civil Code which obliges the lessor to maintain the lessee in the peaceful and adequate enjoyment of the lease for the entire duration of the contract. On October 22, 1964, the lower court issued an order denying the motion to dismiss and motion to dissolve the writ of preliminary injunction on the ground that there was no labor dispute between the plaintiff and defendant of which the Court of Industrial Relations may take cognizance. chanrob les.c om:cra law:red

On November 16, 1964, the court, on motion of the plaintiff, declared defendants in default. Defendants prayed for the lifting of the order of default, which plaintiff opposed. In the order of December 16, 1964, the court denied the motion to lift the order of default, and subsequently defendants’ motion for reconsideration. Thereafter, the court rendered its decision dated February 16, 1965 which declared permanent the writ of preliminary injunction and ordered the defendants to pay the plaintiff jointly and severally the amount of P10,152.42 with interest thereon at legal rate from the commencement of the action until fully paid, P1,000.00 as attorney’s fees and the costs. Copy of this decision was received by defendants on July 20, 1965 and forthwith, defendants filed the notice of appeal on July 26, 1965.

On October 12, 1965, Liwayway Publications, Inc. filed with the Supreme Court a petition praying that a writ of attachment be issued on any sum of money which is owing from the company to the union and to other defendants to be used to satisfy the judgment in its favor should the same be affirmed by the Supreme Court. Defendants filed an opposition to the petition for attachment alleging that even assuming that there is an amount owing to the union from the company, such would be in the concept of uncollected wages due the strikers and, therefore, cannot be subject of attachment as provided by Art. 1708 of the New Civil Code that the laborers’ wages shall not be subject to execution or attachment except for debts incurred for food, shelter, clothing and for medical attendance. The Supreme Court denied the above petition for attachment but without prejudice to the movant seeking remedy in the Court of First Instance. The sole issue raised in the instant appeal is whether or not the lower court has jurisdiction to issue a writ of preliminary injunction considering that there was a labor dispute between Permanent Concrete Products, Inc. and appellants for alleged unfair labor practices committed by the former. The first question that strikes Us to be of determinative significance is whether or not this case involves or has arisen out of a labor dispute. If it does, then with certainty, Section 9 of Republic Act 875, the "Industrial Peace Act," would apply. If it does not, then the Rules of Court will govern the issuance of the writ of preliminary injunction because it will not partake the nature of a labor injunction which the lower court has no jurisdiction to issue. The record before Us reveals that appellant union and its members picketed the gate leading to appellee’s bodega. This gate is about 200 meters from the gate leading to the premises of the employer of the appellants. Appellee is not in any way related to the striking union except for the fact that it is the sublessee of a bodega in the company’s compound. The picketers belonging to the appellant union had stopped and prohibited the truck of the appellee from entering the compound to load newsprint from its bodega, the union members intimidating and threatening with bodily harm the employees of the appellee who were in the truck. The union members also stopped and prohibited the general manager, personnel manager including the man in-charge of the bodega and other employees of the Liwayway Publications, Inc. from getting newsprint in said bodega. The business of the appellee is exclusively the publication of the magazines Bannawag, Bisaya, Hiligaynon and Liwayway weekly magazines which has absolutely no relation or connection whatsoever with the cause of the strike of the union against their company, much less with the terms, conditions or demands of the strikers. In such a factual situation, the query to be resolved is whether the appellee is a third party or an "innocent by-stander" whose right has been invaded and, therefore, entitled to protection by the regular courts. chanroblesvi rtua lawlib rary

At this juncture, it is well to cite and stress the pronouncements of the Supreme Court on the right to picket. Thus, in the case of Phil. Association of Free Labor Unions (PAFLU) v. Judge Gaudencio Cloribel, Et Al., L-25878, March 28, 1969, 27 SCRA 465, 472, the Supreme Court, speaking thru Justice J.B.L. Reyes, said: jgc:chanrobles. com.ph

"The right to picket as a means of communicating the facts of a labor dispute is a phase of the freedom of speech guaranteed by the constitution. If peacefully carried out, it cannot be curtailed even in the absence of employer-employee relationship. The right is, however, not an absolute one. While peaceful picketing is entitled to protection as an exercise of free speech, we believe that courts are not without power to confine or localize the sphere of communication or the demonstration to the parties to the labor dispute, including those with related interest, and to insulate establishments or persons with no industrial connection or having interest totally foreign to the context of the dispute. Thus, the right may be regulated at the instance of third parties or `innocent bystanders’ if it appears that the inevitable result of its exercise is to create an impression that a labor dispute with which they have no connection or interest exists between them and the picketing union or constitute an invasion of their rights. In one case decided by this Court, we upheld a trial court’s injunction prohibiting the union from blocking the entrance to a feed mill located within the compound of a flour mill with which the union had a dispute. Although sustained on a different ground, no connection was found other than their being situated in the same premises. It is to be noted that in the instances cited, peaceful picketing has not been totally banned but merely regulated. And in one American case, a picket by a labor union in front of a motion picture theater with which the union had a labor dispute was enjoined by the court from being extended in front of the main entrance of the building housing the theater wherein other stores operated by third persons were located." cralaw virtua1aw l i brary

The same case state clearly and succinctly the rationalization for the court’s regulation of the right to picket in the following wise and manner:

jgc:chanrob les.co m.ph

"Wellington and Galang are mere `innocent bystanders’. They are entitled to seek protection of their rights from the courts and the courts may, accordingly, legally extend the same. Moreover, PAFLU’s right to peacefully picket METBANK is not curtailed by the injunctions issued by respondent judge. The picket is merely regulated to protect the rights of third parties. And the reason for this is not farfetched. If the law fails to afford said protection, men will endeavor to safeguard their rights by their own might, take the law in their own hands, and commit acts which lead to breaches of the law. This should not be allowed to happen." cralaw virtua1aw l ibra ry

It may be conceded that the appellant Union has a labor dispute with the Permanent Concrete Products company and that the dispute is pending before the Court of Industrial Relations docketed therein as CIR Case No. 156-Inj., Charge 212-ULP and Charge No. 1414-M.C. Nonetheless, the rule laid down in the case of National Garment and Textile Workers’ Union (PAFLU) v. Hon. Hermogenes Caluag, Et Al., G.R. No. L-9104, September 10, 1956, cited by the appellants as authority holding that "where the Court of Industrial Relations has already acquired jurisdiction over two unfair labor practices cases and much later on as a consequence thereof, the Court of First Instance cannot legally issue a writ of preliminary injunction against the picketers. Besides, the jurisdiction of the Court of Industrial Relations is exclusive. "Sec. 5-a, Republic Act 875" is not controlling, much less applicable to the instant case where the facts are essentially and materially different. chan roble s.com. ph : virtual law l ibra ry

Neither is the case of SMB Box Factory Workers’ Union v. Hon. Gustavo Victoriano, Et Al., G.R. No. L-12820, Dec. 29, 1957, where We held that "the Court of First Instance cannot take cognizance of an action for injunction where the issue involved is interwoven with unfair labor practice cases pending in the Court of Industrial Relations," nor the rule laid down in Erlanger & Galinger, Inc. v. Erlanger & Galinger Employees Association-NATU, G.R. No. L-11907, June 24, 1958, 104 Phil. 17, holding that "even if no unfair labor practice suit has been filed at all by any of the parties in the Court of Industrial Relations at the time the present petition for injunction was filed in the court below, still the latter court would have no jurisdiction to issue the temporary restraining order prayed for if it is shown to its satisfaction that the labor dispute arose out of unfair labor practices committed by any of the parties. The parties would still have to institute the proper action in the Court of Industrial Relations, and there ask for a temporary restraining order under Sec. 9(d) of the Industrial Peace Act." c ralaw virtua1aw l ibra ry

We cannot agree that the above rules cited by the appellants are controlling in the instant case for as We said in Phil. Association of Free Labor Unions (PAFLU), Et. Al. v. Tan, 99 Phil. 854, that "with regard to activities that may be enjoined, in order to ascertain what court has jurisdiction to issue the injunction, it is necessary to determine the nature of the controversy," (Italics supplied) We find and hold that there is no connection between the appellee Liwayway Publications, Inc. and the striking Union, nor with the company against whom the strikers staged the strike, and neither are the acts of the driver of the appellee, its general manager, personnel manager, the man in-charge of the bodega and other employees of the appellee in reaching the bodega to obtain newsprint therefrom to feed and supply its publishing business interwoven with the labor dispute between the striking Union and the Permanent Concrete Products company. If there is a connection between appellee publishing company and the Permanent Concrete Products company, it is that both are situated in the same premises, which can hardly be considered as interwoven with the labor dispute pending in the Court of Industrial Relations between the strikers and their employer. The contention of appellants that the court erred in denying their motion to dismiss on the ground that the complaint states no cause of action, is likewise without merit. Article 1654 of the New Civil Code cited by the appellants in support of their motion to dismiss, which obliges the lessor, among others, to maintain the lessee in the peaceful and adequate enjoyment of the lease for the entire duration of the contract, and therefore, the appellee publishing company should have brought its complaint against the first sublessee, Don Ramon Roces, and not against the appellant Union, is not in point. The acts complained of against the striking union members are properly called mere acts of trespass (perturbacion de mero hecho) such that following the doctrine laid down in Goldstein v. Roces, 34 Phil. 562, the lessor shall not be obliged to answer for the mere fact of a trespass (perturbacion de mero hecho) made by a third person in the use of the estate leased but the lessee shall have a direct action against the trespasser. chanroblesvi rt ualawlib ra ry

The instant case falls squarely under the provisions of Article 1664 of the New Civil Code which provides as follows:

jgc:chanro bles. com.ph

"Art. 1664. The lessor is not obliged to answer for a mere act of trespass which a third person may cause on the use of the thing leased; but the lessee shall have a direct action against the intruder. There is a mere act of trespass when the third person claims no right whatever."

cralaw virtua1aw li bra ry

The Goldstein doctrine had been reiterated in Reyes v. Caltex (Phil.) Inc., 84 Phil. 654; Lo Ching, Et. Al. v. Court of Appeals, Et Al., 81 Phil. 601; Afesa v. Ayala y Cia, 89 Phil. 292; Vda. de Villaruel, Et. Al. v. Manila Motor Co., Inc., Et Al., 104 Phil. 926; Heirs of B.A. Crumb, Et. Al. v. Rodriguez, 105 Phil. 391. The obligation of the lessor under Art. 1654, New Civil Code, to maintain the lessee in the peaceful and adequate enjoyment of the lease for the entire duration of the

contract arises only when acts, termed as legal trespass (perturbacion de derecho), disturb, dispute, object to, or place difficulties in the way of the lessee’s peaceful enjoyment of the premises that in some manner or other cast doubt upon the right of the lessor by virtue of which the lessor himself executed the lease, in which case the lessor is obliged to answer for said act of trespass. The difference between simple trespass (perturbacion de mero hecho) and legal trespass (perturbacion de derecho) is simply but clearly stated in Goldstein v. Roces case, supra, thus: jgc:chanrob les.com .ph

"Briefly, if the act of trespass is not accompanied or preceded by anything which reveals a really juridic intention on the part of the trespasser, in such wise that the lessee can only distinguish the material fact, stripped of all legal form or reasons, we understand it to be trespass in fact only (de mero hecho)." (pp. 566-567) WHEREFORE, IN VIEW OF THE FOREGOING, the decision appealed from is hereby AFFIRMED in toto. Costs against appellants. SO ORDERED.

x. G.R. Nos. 86917-18

January 25, 1991

RELIANCE SURETY & INSURANCE CO., INC., petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION and RELIANCE SURETY & INSURANCE EMPLOYEES UNION,respondents. Ambrosio Padilla, Mempin & Reyes Law Offices for petitioner. Banzuela, Flores, Miralles, Rañeses, Sy, Taquio & Associates for private respondent. SARMIENTO, J.: The only question in this petition for certiorari is whether or not strikers who have been found to have staged an illegal strike may be reinstated to work. The facts are as follows: xxx

xxx

xxx

It appears that to avoid unnecessary loss of productive working time due to personal and non-work-related conversations, personal telephone calls and non-work-connected visits by personnel to other departments, the respondent Reliance Surety Insurance Co., Inc. (company for short) on 21 November 1986, thru the manager (Mr. Celso Eleazar) of its underwriting department, effected a change in the seating arrangement of its personnel in said department. Four of those affected namely: Isagani Rubio, Rosalinda Macapagal, Glene Molina, and Severa Cansino protested the transfer of their tables and seats, claiming that the change was without prior notice and was done merely to harass them as union members. When the manager insisted, a heated discussion ensued, during which Rubio and companions were alleged to have hurled unprintable insults (sipsip, balimbing, vacuum, etc.) to the manager and supervisors. Rubio, Macapagal, Molina and Cansino were asked to explain within 48 hours why no disciplinary action should be taken against them for misconduct, insubordination, and gross disrespect. The work atmosphere in the department had allegedly become charged or tense as Rubio continued to refuse to stay at his designated place, and Molina and Macapagal still levelled insults to those who testified against them. Hence, Rubio and companions were placed under preventive suspension on 3 February 1987 and ultimately dismissed after investigation on 3 March 1987. On 6 March 1987, the Reliance Surety & Insurance Employees Union (or union for short) filed in behalf of Rubio, Macapagal, Molina, and Cansino with the NLRC-NRC Branch, Manila, against the respondent company a complaint for illegal dismissal (NLRC- NCR Case No. 00-03-00828-87) which it subsequently amended on 7 April 1987 to include the charge of unfair labor practice. The union claims that the company was guilty of unfair labor practice because it, among others, effected transfer and changes in the seating arrangement to pressure or intimidate union members; because it interfered in the union members' exercise of their right to self-organization by forcing them to undertake overtime work even on a non-working Saturday and in times when there were scheduled union meetings to prevent them from attending the same: and because, thru its manager and assistant managers, it caused the resignation and withdrawal of union members from the union. It also appears that on 12 March 1987, or while the complaint for illegal dismissal and ULP was hibernating in the NCR Arbitration Branch, the union filed with the DOLE a notice of strike predicated on unfair labor practices (dismissal of union officers/members, discrimination and coercion on employees) allegedly committed by the company. On 13 March 1987, the company received a copy of the notice of strike and a telegram from the DOLE setting the notice of strike for initial conciliation conference on 17 March 1987 at 2:00 p.m. But even before the initial conference could take place, the union in the morning of 17 March 1987 struck and picketed the company premises by forming human barricades, which effectively obstructed the free ingress to and egress from its premises, more particularly at the lobby of the 8th floor of the building where it has its office, thereby preventing its officials and employees from doing their usual duties. Because of this new development, the company filed on 31 March 1987 with the NLRC-NCR Arbitration Branch, Manila, a petition to declare the strike illegal (NLRC-CR Case No. 00-03-001179-87) on the grounds that the 30 or 15 day cooling-off period was blatantly defied; that the legal requirement to furnish the department with the results of the strike vote at least 7 days before the strike was ignored; just as the 24-hour period within which BLR or the Regional Office should be furnished with a written notice of the meeting to declare a strike was also not complied with.

Charged, together with the union and its members, as individual respondents in the petition to declare the strike illegal were the following officers: Rolando Tugade, president; Joseph Aying, vice-president; Isagani Rubio, treasurer; Ms. Glene Molina and Ms. Rosalinda Macapagal, secretaries; Froilan Garcia and Ms. Luz Monroy, Sgts. at arms: Orlando Calma, auditor; and Manolo Que, pro, who, the company claims, should be divested of their employment status for having knowingly participated in the illegal strike and in the commission of illegal acts.1 xxx

xxx

xxx

The Labor Arbiter found the strike to be illegal, a finding the National Labor Relations Commission, on appeal, affirmed. However, the Commission held: xxx

xxx

xxx

However, while we are convinced that the strike is illegal, we are equally convinced that it should not be visited with the consequence so harsh as the supreme penalty of dismissal, where merely reinstating them (strikers) without backwages would suffice in view of the union's belief, in proceeding with strike, that the company was committing unfair labor practice in terminating the services of some of its officers and members, in line with the Supreme Court ruling in the case of Ferrer vs. CIR, 17 SCRA 352, to that effect. In justifying the imposition of a penalty lesser than dismissal even in cases involving strikes tainted with illegality, the Supreme Court in the case of Almira vs. B.F. Goodrich Phils., Inc., 58 SCRA 120 ruled: It would imply at the very least that where a penalty less punitive would suffice, whatever missteps s may be committed by labor ought not to be visited with a consequence so severe. It is not only because of the law's concern for the workingman. There is, in addition, as family to consider. Unemployment brings untold hardships and sorrows on those depending on the wage-earner. The misery and pain attendant on the loss of jobs then could be avoided. xxx

xxx

xxx

In other words, under the circumstances obtaining in this case, we find it more in keeping with justice and equity if the striking union officers are reinstated, instead of being dismissed, to their former positions without loss of seniority rights but without backwages to serve as penalty for their indiscretion in launching an illegal strike.2 xxx

xxx

xxx

The Commission then disposed as follows: WHEREFORE, under the premises, the decision appealed from is hereby AFFIRMED, subject to the modification that all the striking officers of the appellant union should be reinstated to their former positions without loss of seniority rights but without backwages except Isagani Rubio, Glene Molina, and Rosalinda Macapagal, whose dismissal due to gross disrespect was found to be justified, and Luz Monroy who, in consideration of the financial assistance of P4,500.00 had withdrawn her appeal and allowed the arbiter's order of dismissal to be binding upon her. The dismissal of Severa Cansino due to gross disrespect is likewise upheld. However, the company is directed to pay said employees, namely Isagani Rubio, Glene Molina, Rosalinda Macapagal and Severa Cansino one month salary each including cost of living allowance and other benefits. 3 The petitioner argues that in so disposing, the Commission is guilty of a grave abuse of discretion. There is no dispute that the strike in question was illegal, for failure of the striking personnel to observe legal strike requirements, to wit: (1) as to the fifteen-day notice; (2) as to the two-thirds required vote to strike done by secret ballot; (3) as to submission of the strike vote to the Department of Labor at least seven days prior to the strike.4 As found likewise by the Commission, in the course of the strike held on April 1, 1987, certain strikers harassed non-striking employees, called company officers names, and committed acts of violence (as a result of which, criminal charges were brought with the fiscal's office.)5 There is no question, finally, that the strike itself was prompted by no actual, existing unfair labor practice committed by the petitioner. In effecting a change in the seating arrangement in the office of the underwriting department, the petitioner merely exercised a reasonable prerogative employees could not validly question, much less assail as an act of unfair labor practice. The Court is indeed at a loss how rearranging furniture, as it were, can justify a four-month-long strike. As to the private respondent's charges of harassment, the Commission found none, and as a general rule, we are bound by its findings of fact. Amid this background, the Court must grant the petition. In staging the strike in question, a strike that was illegal in more ways than one, the reinstated union officers were clearly in bad faith, and to reinstate them without, indeed, loss of seniority rights, is to reward them for an act public policy does not sanction. The private respondents can not find sanctuary in the cases of Ferrer v. Court of Industrial Relations6 and Almira v. BF Goodrich Philippines, Inc.,7 in which we affirmed reinstatement in spite of an "illegal" strike. In the first place, neither Ferrer nor Almira involved an illegal strike. What was involved in Ferrer was a defective strike, that is, one conducted in violation of the thirty-day "cooling-off' period, but one carried out in good faith "to offset what petitioners were warranted in believing in good faith to be unfair labor practices [committed by] Management."8 What Almira on the other hand declared was that a violent strike alone does not make the action illegal, which would justify the dismissal of strikers. It is therefore clear that we ordered reinstatement in both cases not in spite of the illegality of the strike but on the contrary, because the same was "legal", that is to say, carried out in good faith. We can not apply, either, the ruling in Bacus v. Ople,9 where we held that the mere finding of illegality attending a strike does not justify the "wholesale" dismissal of strikers who were otherwise impressed with good faith. The Court must not be understood to be abandoning the teachings of either Ferrer, Almira, or Bacus. The Court reiterates that good faith is still a valid defense against claims of illegality of a strike. We do find, however, not a semblance of good faith here, but rather, plain arrogance, pride, and cynicism of certain workers. 1âwphi1

With respect to the private respondent, Isagani Rubio, what militates against his readmission to the firm is the fact that he had accepted the sum of P2,448.80 "in full satisfaction of the . . . Decision" (of the Labor Arbiter). He can not now insist on reinstatement after accepting the legality of his dismissal. He can not have his cake and eat it too. As a general rule, the sympathy of the Court is on the side of the laboring classes, not only because the Constitution imposes sympathy but because of the onesided relation between labor and capital. The Court must take care, however, that in the contest between labor and capital, the results achieved are fair and in conformity with the rules. We will not accomplish that objective here by approving the act of the National Labor Relations Commission which we hold to constitute a grave abuse of discretion. WHEREFORE, the petition is GRANTED. SO ORDERED.

Y. Phil. Metal Foundries Inc vs CIR, GR Nos. L-34948-49, May 25, 1979 [G.R. Nos. L-34948-49. May 15, 1979] PHILIPPINE METAL FOUNDRIES, INC., Petitioner, v. COURT OF INDUSTRIAL RELATIONS, REGAL MANUFACTURING EMPLOYEES ASSOCIATION (REGEMAS) and CELESTINO BAYLON, Respondents. V. E. del Rosario & Associates for Petitioner. Rufino B. Risma for Private Respondents. SYNOPSIS As President of the Union, Celestino Baylon invited the general manager of the Company for a grievance conference to thresh out union problems. The invitation was received by the Company at noon. Two hours later, Baylon was in turn handed his termination letter. In the belief that the dismissal of Baylon was due to union activities, the Union declared a strike. The Company filed an unfair labor practice complaint against the union for declaring a strike inspite of the existence of an nostrike agreement. The Union, on the other hand, filed an unfair labor practice complaint against the Company for having discharged the Union President for his union activities. After holding joint trial, the Court of Industrial Relations found that Baylon was discharged for his union activities and that the employees declared a strike because they believed in good faith that the dismissal of the President was an unfair labor practice. The Supreme Court affirmed the decision of the Industrial Court. Petition dismissed.

SYLLABUS

1. LABOR; UNFAIR LABOR PRACTICE; REASON FOR DISCHARGE MUST BE ESTABLISHED. — To determine whether a discharge is discriminatory, the true reason for the discharge must be established. While union activity is no bar to a discharge, the existence of a lawful cause for discharge is no defense if the employee was actually discharged for union activity. 2. ID.; FINDINGS OF FACT OF THE INDUSTRIAL COURT. — The question of whether an employee was discharged because of his union activities is essentially a question of fact as to which the findings of the Court of Industrial Relations are conclusive and binding if supported by substantial evidence considering the record as a whole. This is so because the Industrial Court is governed by the rules of substantial evidence, rather than by the rule of preponderance of evidence as in ordinary civil cases. 3. EVIDENCE; SUBSTANTIAL EVIDENCE, DEFINED. — Substantial evidence has been defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. It means such evidence which affords a substantial basis from which the fact in issue can be reasonably inferred. 4. ID.; MOTIVE; PROOF OF. — Although a man’s motive, like his intent, is, "as much a fact as the state of his digestion", evidence of such fact may consist both direct testimony by one whose motive is in question and of inference of probability drawn from the totality of others facts. 5. LABOR; STRIKE; UNFAIR LABOR PRACTICE, DISMISSAL DUE TO UNION ACTIVITIES. — When a union declares a strike in the belief that the dismissal of the president was due to union activities, said strike is not illegal. 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. 6. ID.; ID.; ID.; "NO STRIKE" CLAUSE APPLICABLE ONLY TO ECONOMIC STRIKES. — A strike declared due to unfair labor practice of the employer is not a violation of the "no strike" clause of the Collective Bargaining Agreement. Moreover, a no strike clause prohibition in a Collective Bargaining Agreement is applicable only to economic strikes. 7. ID.; ID.; NOTICE OF STRIKE. — In strikes arising out of and against a company’s unfair labor practice, a strike notice is not necessary in view of the strike being founded on urgent necessity and directed against practices condemned by public policy, such notice being legally required only in cases of economic strikes.

DECISION

ANTONIO, J.:

The Philippine Metal Foundries, Inc. (now dissolved and merged with Shriro [Philippines] Inc.) is seeking in this case a review of the decision of the Court of Industrial Relations in Cases Nos. 3932-ULP and 3941-ULP. Petitioner, in its complaint dated November 21, 1963 (Case No. 3941-ULP), charged the Regal Manufacturing Employees Associations (FTUP) and its members (herein private respondents), with unfair labor practice for declaring a strike on October 5, 1963 and picketing the company’s premises without filing a notice of strike in spite of the existence of a no strike, no lockout clause and grievance procedure in the collective bargaining agreement entered into between the petitioner and the Union. In their answer to this complaint, the Union and its members denied the charge and, as affirmative defense, alleged that on October 3, 1963, the Union requested the management for a grievance conference, stating in its invitation the time and place of meeting, but the company, through its General Manager, refused and instead handed the Union’s President a memorandum dismissing him from work and told the Union members not to report for work, which is in violation of the no lockout and no strike clause of the contract.

Upon the other hand, petitioner Philippine Metal Foundries, Inc. and its General Manager, in Case No. 3932-ULP, were charged by private respondents on July 21, 1964 with unfair labor practice for the dismissal of Celestino Baylon, President of the Union, on October 3, 1963, allegedly due to his union activities in representing and protecting the Union members in their relations with the petitioner. To this complaint, petitioner and its manager filed an answer denying the material allegations and alleged as affirmative defenses, among others, that on October 3, 1963, the company was constrained to terminate the services of Baylon by reason of the fact that he had, in spite of repeated notices and warnings from the company, frequently and repeatedly absented himself from his work as foundry worker and by reason of said dismissal he, as President of the Union as well as an officer of the FTUP, encouraged and abetted the staging of a strike on October 5, 1963, without prior notice to the company or any of the latter’s officials, in gross violation of a stipulation provided in their Collective Bargaining Agreement, establishing pickets and blocking ingress and egress to and from the company’s premises, causing interruption of the work and/or business of the company to its serious damage and prejudice. chanrobles law lib rary : red

After holding joint trial on these two cases, the Court of Industrial Relations rendered its decision, finding that Baylon, as Union President, was discharged for his union activities and that the employees declared a strike because they believed in good faith that the dismissal of their President was an unfair labor practice. The Court declared respondents Philippine Metal Foundries, Inc. and Leopoldo Relunia, in Case No. 3932-ULP, guilty of unfair labor practice in dismissing complainant Celestino Baylon; ordered respondents to reinstate Celestino Baylon to his former position with all the rights and privileges formerly appertaining thereto, with one (1) year back wages computed from October 3, 1963; and dismissed the petitioner’s charge in Case No. 3941-ULP. Its motion for reconsideration having been denied by the Court of Industrial Relations en banc, petitioner filed the present petition which was considered by this Court as submitted for decision without respondents’ brief. The issues raised are: (1) whether Celestino Baylon was dismissed due to his absences or to his union activities as Union President; and (2) whether the strike declared by the Union on October 5, 1963, is legal or not. With respect to the first issue, it is argued by petitioner that according to the Collective Bargaining Agreement between the Union and the company "one absent for a period of one week who fails to give notice thereof shall be dropped automatically" and under its Disciplinary Policies and Procedures, dated and enforced since March 1, 1963, absence of an employee without permission for a period of seven (7) consecutive calendar days is a ground for immediate dismissal, upon establishment of guilt; that since the Court of Industrial Relations found that Baylon incurred numerous absences from January to September 1963, broken down as follows: for the month of January, one (1) unexcused absence; March, one (1) unexcused absence and twelve (12) consecutive absences without permission; April, four (4) consecutive absences without permission; May, two (2) absences without permission; and September, five (5) unexcused absences, the said court erred in holding that in Case No. 3932-ULP, Baylon was dismissed not because of his absences but rather due to his being Union President and union activities. In determining whether a discharge is discriminatory, the true reason for the discharge must be established. It has been said that while union activity is no bar to a discharge, the existence of a lawful cause for discharge is no defense if the employee was actually discharged for union activity. There is no question that Celestino Baylon incurred numerous absences from January to September 1963. Had the company wanted to terminate his services on the ground of absences, it could have done so, pursuant to Article V of the Collective Bargaining Agreement as early as March 1963 when he incurred twelve (12) consecutive absences without permission. Its failure to do so shows that the infractions committed by Baylon were disregarded. The Court of Industrial Relations found that Baylon went to the company on September 28, 1963, but did not work as he was very sleepy. When he reported for work on October 1, 1963, he submitted a written explanation for his absences which was received by the company. Two (2) days later, as President of the Union, he invited the General Manager of the company for a grievance conference to thresh out union problems at the D & E Restaurant at 6:00 p.m. of October 5, 1963. The letter of invitation was received by the company at almost 12:45 noon of October 3, 1963. At 2:45 p. m. of the same day, Baylon was in turn handed his termination letter. Under the attendant circumstances, We believe the Court of Industrial Relations was justified in concluding that: jgc:chan roble s.com.p h

"In 1963, Baylon had been a habitual absentee. His excused absences for causes other than sickness, sick leave and vacation leave, total two (2) in January; nine (9) in February; eleven (11) in April; ten (10) in May; nine (9) in June; eleven (11) in July; and five (5) in August (Exhs.’5’ and ‘5-A’). "This record, plus his numerous tardiness and half-day work, and the aforesaid unexcused absences, show how little work for the employer Baylon had been doing as an employee (Exhs.’EE’ and ‘6-A’). His last unexcused absence in September must have been just enough on the part of the company to withdraw its special treatment of Baylon as union president (Exh.’EE’). "This Court believes, however, that it was the aforementioned letter of invitation to a grievance conference sent by Baylon to the general manager (Exhs.’DD’ and ‘7’), coming at the heels of his last unexcused absences, that broke the proverbial camel’s back. His dismissal under the foregoing circumstances, being ultimately triggered by his union activity, is therefore not without some taint of unfair labor practice." cralaw virt ua1aw li bra ry

The question of whether an employee was discharged because of his union activities is essentially a question of fact as to which the findings of the Court of Industrial Relations are conclusive and binding if supported by substantial evidence considering the record as a whole. 1 This is so because the Industrial Court is governed by the rule of substantial evidence, rather than by the rule of preponderance of evidence as in any ordinary civil cases. 2 Substantial evidence has been defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. 3 It means such evidence which affords a substantial basis from which the fact in issue can be reasonably inferred. 4 Examining the evidence on hand on this matter, We find the same to be substantially supported. cralawnad

Although a man’s motive, like his intent, is, in the words of Lord Justice Bowen, "as much a fact as the state of his digestion", evidence of such fact may consist both direct testimony by one whose motive is in question and of inferences of probability drawn from the totality of other facts. 5 It is admitted by petitioner that it accepted the invitation of Baylon for a grievance conference on October 5, 1963. Yet, two hours after it accepted the letter of invitation, it dismissed Baylon without prior notice and/or investigation. Such dismissal is undoubtedly an unfair labor practice committed by the company. Under these facts and circumstances, Baylon and the members of the Union had valid reasons to ignore the schedule grievance conference and declared a strike. When the Union declared a strike in the belief that the dismissal of Baylon was due to union activities, said strike was not illegal. 6 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. 7 The strike declared by the Union in this case cannot be considered a violation of the "no strike" clause of the Collective Bargaining Agreement because it was due to the unfair labor practice of the employer. Moreover, a no strike clause prohibition in a Collective Bargaining Agreement is applicable only to economic strikes. 8 The strike cannot be declared as illegal for lack of notice. In strikes arising out of and against a company’s unfair labor practice, a strike notice is not necessary in view of the strike being founded on urgent necessity and directed against practices condemned by public policy, such notice being legally required only in cases of economic strikes. 9 On the contention of petitioner that the grievance conference which Baylon requested to be held on October 5, 1963 was not for the purpose of discussing union problems but of his dismissal, it is clearly shown in the records that Baylon received his termination letter after he requested for a grievance conference. It is, therefore, clear that when Baylon requested for a grievance conference, he was not yet aware of his dismissal. Baylon could not have requested for a grievance conference on October 5, 1963 if he did not have demands to present on that date. The records disclose that, as Union President, he used to make representations and protestations in behalf of the members of the Union against unfair acts committed by the company. As early as March 2, 1962, he reminded the company of an agreement arrived at in a previous labor-management conference that was violated when the management hired several casual workers without giving preference to previously laid off employees and without notifying the Union President (Exhibit "P"). On May 25, 1962, he complained of the poor condition of the toilet facilities in one of the buildings of the company and requested the management for its improvement (Exhibit "Q"). On August 18, 1962, he called the attention of the management regarding the plight of seventy-two (72) workers who were supposed to be temporarily laid off for a period of two (2) months only as agreed upon between the Union and the management, but were not re-hired after the lapse of the period so he requested for the payment of their separation pay (Exhibit "R"). On December 14, 1962, he requested for the payment of a claim for compensation of a worker prior to the scheduled hearing of the same (Exhibit "U"). On December 20, 1962, he worked for the payment of the accrued vacation and sick leave of a terminated worker (Exhibit "V"). On January 12, 1963, he interceded for the payment of the two months separation pay of another terminated worker (Exhibit "W"). On April 25, 1963, he worked for the payment of separation pays of terminated workers found to be physically unfit (Exhibit "AA"). And on September 2, 1963, he invited the General Manager of the company for a grievance conference to settle the complaints of several Union members regarding their vacation leaves and other union problems (Exhibit "BB"). These exhibits show how Baylon, as President of the Union, fought for the rights and protection of his members. We are satisfied that the Court’s finding, in the above regard, are supported by substantial evidence on the record considered as a whole. chanrobles. com:c ralaw:red

IN VIEW WHEREOF, the petition for certiorari is hereby DISMISSED. Fernando, Concepcion, Jr., Santos and Abad Santos, JJ., concur. Aquino, J., took no part.

z. G.R. No. 92009 February 17, 1993 MASTER IRON LABOR UNION (MILU), WILFREDO ABULENCIA, ROGELIO CABANA, LOPITO SARANILLA, JESUS MOISES, BASILIO DELA CRUZ, EDGAR ARANES, ELY BORROMEO, DANIEL BACOLON, MATIAS PAJIMULA, RESTITUTO PAYABYAB, MELCHOR BOSE, TEOFILO ANTOLIN, ROBERT ASPURIA, JUSTINO BOTOR, ALFREDO FABROS, AGAPITO TABIOS, BENARDO ALFON, BENIGNO BARCENA, BERNARDO NAVARRO, MOISES LABRADOR, ERNESTO DELA CRUZ, EDUARDO ESPIRITU, IGNACIO PAGTAMA, BAYANI PEREZ, SIMPLICIO PUASO, EDWIN VELARDE, BEATO ABOGADO, DANILO SAN ANTONIO, BERMESI BORROMEO, and JOSE BORROMEO, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION and MASTER IRON WORKS AND CONSTRUCTION CORPORATION, respondents. Banzuela, Flores, Mirrales, Rañeses, Sy, Taquio and Associates for petitioners. Carlos L. Galarrita for private respondent.

MELO, J.: The petition for certiorari before us seeks to annul and to set aside the decision of the National Labor Relations Commission (Second Division) dated July 12, 1986 which affirmed that of Labor Arbiter Fernando V. Cinco declaring illegal the strike staged by petitioners and terminating the employment of the individual petitioners. The Master Iron Works Construction Corporation (Corporation for brevity) is a duly organized corporate entity engaged in steel fabrication and other related business activities. Sometime in February 1987, the Master Iron Labor Union (MILU) entered into a collective barganing agreement (CBA) with the Corporation for the three-year period between December 1, 1986 and November 30, 1989 (Rollo, p. 7). Pertinent provisions of the CBA state: Sec. 1. That there shall be no strike and no lockout, stoppage or shutdown of work, or any other interference with any of the operation of the COMPANY during the term of this AGREEMENT, unless allowed and permitted by law. Sec. 2. Service Allowance — The COMPANY agrees to continue the granting of service allowance of workers assigned to work outside the company plant, in addition to his daily salary, as follows: (a) For those assigned to work outside the plant within Metro Manila, the service allowance shall be P12.00; (b) For those assigned to work outside Metro Manila, the service allowance shall be P25.00/day; (c) The present practice of conveying to and from jobsites of workers assigned to work outside of the company plant shall be maintained. Right after the signing of the CBA, the Corporation subcontracted outside workers to do the usual jobs done by its regular workers including those done outside of the company plant. As a result, the regular workers were scheduled by the management to work on a rotation basis allegedly to prevent financial losses thereby allowing the workers only ten (10) working days a month (Rollo, p. 8). Thus, MILU requested implementation of the grievance procedure which had also been agreed upon in the CBA, but the Corporation ignored the request. Consequently, on April 8, 1987, MILU filed a notice of strike (Rollo, p. 54) with the Department of Labor and Employment. Upon the intervention of the DOLE, through one Atty. Bobot Hernandez, the Corporation and MILU reached an agreement whereby the Corporation acceded to give back the usual work to its regular employees who are members of MILU (Rollo, p. 55). Notwithstanding said agreement, the Corporation continued the practice of hiring outside workers. When the MILU president, Wilfredo Abulencia, insisted in doing his regular work of cutting steel bars which was being done by casual workers, a supervisor reprimanded him, charged him with insubordination and suspended him for three (3) days (Rollo, pp. 9 & 51-52). Upon the request of MILU, Francisco Jose of the DOLE called for conciliation conferences. The Corporation, however, insisted that the hiring of casual workers was a management prerogative. It later ignored subsequent scheduled conciliation conferences (Rollo, pp. 5152 & 57-58). Hence, on July 9, 1987, MILU filed a notice of strike on the following grounds: (a) violation of CBA; (b) discrimination; (c) unreasonable suspension of union officials; and (d) unreasonable refusal to entertain grievance (Rollo, p. 9). On July 24, 1987, MILU staged the strike, maintaining picket lines on the road leading to the Corporation's plant entrance and premises. At about 11 o'clock in the morning of July 28, 1987, CAPCOM soldiers, who had been summoned by the Corporation's counsel, came and arrested the picketers. They were brought to Camp Karingal and, the following day, to the Caloocan City jail. Charges for illegal possession of firearms and deadly weapons were lodged against them. Later, however, those charges were dismissed for failure of the arresting CAPCOM soldiers to appear at the investigation (Rollo, p. 10). The dispersal of the picketlines by the CAPCOM also resulted in the temporary lifting of the strike. On August 4, 1987, the Corporation filed with the NLRC National Capital Region arbitration branch a petition to declare the strike illegal (Rollo, p. 40). On September 7, 1987, MILU, with the assistance of the Alyansa ng Manggagawa sa Valenzuela (AMVA), re-staged the strike. Consequently, the

Corporation filed a petition for injunction before the NLRC which, on September 24, 1987, issued an order directing the workers to remove the barricades and other obstructions which prevented ingress to and egress from the company premises. The workers obliged on October 1, 1987 (Rollo, p. 25). On October 22, 1987, through its president, MILU offered to return to work in a letter which states: 22 Okt. 1987 Mr. Elieze Hao Master Iron Works & Construction Corp. 790 Bagbagin, Caloocan City Dear Sir: Ang unyon, sa pamamagitan ng nakalagda sa ibaba, ay nagmumungkahi, nagsusuhestiyon o nag-oofer sa inyong pangasiwaan ng aming kahilingan na bumalik na sa trabaho dahilan din lang sa kalagayan na tuloy tuloy ang ating pag-uusap para sa ikatitiwasay ng ating relasyon. Gusto naming manatili ang ating magandang pagtitinginan bilang magkasangga para sa ika-uunlad ng ating kumpanya. Sana ay unawain niyo kami dahil kailangan namin ng trabaho. Gumagalan g, (Sgd.) WILFREDO ABULENCIA Pangulo (Rollo, p. 590) On October 30, 1987, MILU filed a position paper with counter-complaint before the NLRC. In said counter-complaint, the workers charged the Corporation with unfair labor practice for subcontracting work that was normally done by its regular workers thereby causing the reduction of the latter's workdays; illegal suspension of Abulencia without any investigation; discrimination for hiring casual workers in violation of the CBA, and illegal dispersal of the picket lines by CAPCOM agents (Rollo, pp. 26-27). In due course, a decision dated March 16, 1988 was rendered by Labor Arbiter Fernando Cinco declaring illegal the strike staged by MILU. The dispositive portion of the decision reads: WHEREFORE, in the light of the foregoing premises, judgment is hereby rendered, as follows: 1. Declaring the strike by the respondents illegal and unlawful; 2. Ordering the cancellation of the registered permit of respondent union MILU for having committed an illegal strike; 3. Ordering the termination of employment status of the individual respondents, including the forfeiture of whatever benefits are due them under the law, for having actively participated in an illegal strike, namely: Wilfredo Abulencia, President; Rogelio Cabana, VicePresident; Lopito Saranilla, Secretary; Jesus Moises, Treasurer; Basilio dela Cruz, Auditor; as Members of the Board: Edgar Aranes, Melchor Bose, Restituto Payabyab, Matias Pajimula, Daniel Bacolon, and Ely Borromeo, as Members of the Union: Teofilo Antolin, Robert Aspuria, Justino Botor, Alfredo Fabros, Agapito Tabios, Bernardo Alfon, Benigno Barcena, Bernardo Navaro, Moises Labrador, Ernesto dela Cruz, Eduardo Espiritu, Ignacio Pagtama, Bayani Perez, Simplicio Puaso, Edwin Velarde, Beato Abogado, Danila San Antonio, Bermes Borromeo and Jose Borromeo. The respondents as appearing in Annex "A" of the Petition, but not included as among those whose employment status were not terminated as above-mentioned, are given priority of reinstatement, without backwages, in the event petitioner starts its normal operations, or shall be paid their separation pay according to law. 4. Ordering the respondents to cease and desist from further committing the illegal acts complained of; 5. Ordering Respondent Union to pay the amount of P10,000.00 to Petitioner's Counsel as attorney's fees; 6. Ordering the dismissal of the claim for damages for lack of merit; and 7. Ordering the dismissal of the counter-complaint in view of the filing of a separate complaint by the respondents. SO ORDERED. (pp. 35-36, Rollo.)

On appeal to the NLRC, MILU and the individual officers and workers named in Labor Arbiter Cinco's decision alleged that said labor arbiter gravely abused his discretion and exhibited bias in favor of the Corporation in disallowing their request to cross-examine the Corporation's witnesses, namely, Corporate Secretary Eleazar Hao, worker Daniel Ignacio and foreman Marcial Barcelon, who all testified on the manner in which the strike was staged and on the coercion and intimidation allegedly perpetrated by the strikers (Rollo, p. 151). The Second Division of the NLRC affirmed with modifications the decision of the labor arbiter. The decision, which was promulgated on July 12, 1989 with Commissioners Domingo H. Zapanta and Oscar N. Abella concurring and Commissioner Daniel M. Lucas, Jr. dissenting, disagreed with the labor arbiter on the "summary execution of the life of Master Iron Labor Union (MILU)" on the grounds that the Corporation did not specifically pray for the cancellation of MILU's registration and that pursuant to Articles 239 and 240 of the Labor Code, only the Bureau of Labor Relations may cancel MILU's license or certificate of registration. It also deleted the award of P10,000.00 as attorney's fees for lack of sufficient basis but it affirmed the labor arbiter with regard to the declaration of illegality of the strike and the termination of employment of certain employees and the rest of the dispositive portion of the labor arbiter's decision (Rollo, pp. 4849). In his dissent, Commissioner Lucas stated that he is "for the setting aside of the decision appealed from, and remanding of the case to the labor arbiter of origin, considering the respondent's countercharge or complaint for unfair labor practice was not resolved on the merits" (Rollo, p. 49). MILU filed a motion for the reconsideration but the same was denied by the NLRC for lack of merit in its Resolution of August 9, 1989 (Rollo, p. 50). Hence, the instant petition.1 Petitioners contend that notwithstanding the non-strike provision in the CBA, the strike they staged was legal because the reasons therefor are non-economic in nature. They assert that the NLRC abused its discretion in holding that there was "failure to exhaust the provision on grievance procedure" in view of the fact that they themselves sought grievance meetings but the Corporation ignored such requests. They charge the NLRC with bias in failing to give weight to the fact that the criminal charges against the individual petitioners were dismissed for failure of the CAPCOM soldiers to testify while the same individual strikers boldly faced the charges against them. Lastly, they aver that the NLRC abused its discretion in holding that the workers' offer to return to work was conditional. In holding that the strike was illegal, the NLRC relied solely on the no-strike no-lockout provision of the CBA aforequoted. As this Court has held in Philippine Metal Foundries, Inc. vs. CIR (90 SCRA 135 [1979]), a no-strike clause in a CBA is applicable only to economic strikes. Corollarily, if the strike is founded on an unfair labor practice of the employer, a strike declared by the union cannot be considered a violation of the no-strike clause. An economic strike is defined as one which is to force wage or other concessions from the employer which he is not required by law to grant (Consolidated Labor Association of the Philippines vs. Marsman & Co., Inc., 11 SCRA 589 [1964]). In this case, petitioners enumerated in their notice of strike the following grounds: violation of the CBA or the Corporation's practice of subcontracting workers; discrimination; coercion of employees; unreasonable suspension of union officials, and unreasonable refusal to entertain grievance. Private respondent contends that petitioner's clamor for the implementation of Section 2, Article VIII of the CBA on service allowances granted to workers who are assigned outside the company premises is an economic issue (Rollo, p. 70). On the contrary, petitioners decry the violation of the CBA, specifically the provision granting them service allowances. Petitioners are not, therefore, already asking for an economic benefit not already agreed upon, but are merely asking for the implementation of the same. They aver that the Corporation's practice of hiring subcontractors to do jobs outside of the company premises was a way "to dodge paying service allowance to the workers" (Rollo, pp. 61 & 70). Much more than an economic issue, the said practice of the Corporation was a blatant violation of the CBA — and unfair labor practice on the part of the employer under Article 248(i) of the Labor Code. Although the end result, should the Corporation be required to observe the CBA, may be economic in nature because the workers would then be given their regular working hours and therefore their just pay, not one of the said grounds is an economic demand within the meaning of the law on labor strikes. Professor Perfecto Fernandez, in his book Law on Strikes, Picketing and Lockouts (1981 edition, pp. 144-145), states that an economic strike involves issues relating to demands for higher wages, higher pension or overtime rates, pensions, profit sharing, shorter working hours, fewer work days for the same pay, elimination of night work, lower retirement age, more healthful working conditions, better health services, better sanitation and more safety appliances. The demands of the petitioners, being covered by the CBA, are definitely within the power of the Corporation to grant and therefore the strike was not an economic strike. The other grounds, i.e., discrimination, unreasonable suspension of union officials and unreasonable refusal to entertain grievance, had been ventilated before the Labor Arbiter. They are clearly unfair labor practices as defined in Article 248 of the Labor Code.2 The subsequent withdrawal of petitioners' complaint for unfair labor practice (NLRC-NCR Case No. 00-11-04132-87) which was granted by Labor Arbiter Ceferina Diosana who also considered the case closed and terminated (Rollo, pp. 97 & 109) may not, therefore, be considered as having converted their other grievance into economic demands. Moreover, petitioners staged the strike only after the Corporation had failed to abide by the agreement forged between the parties upon the intervention of no less than the DOLE after the union had complained of the Corporation's unabated subcontracting of workers who performed the usual work of the regular workers. The Corporation's insistence that the hiring of casual employees is a management prerogative betrays its attempt to coat with legality the illicit curtailment of its employees' rights to work under the terms of the contract of employment and to a fair implementation of the CBA. While it is true that an employer's exercise of management prerogatives, with or without reason, does not per seconstitute unjust discrimination, such exercise, if clearly shown to be in grave abuse of discretion, may be looked into by the courts (National Federation of Labor Unions vs. NLRC, 202 SCRA 346 [1991]). Indeed, the hiring, firing, transfer, demotion, and promotion of employees are traditionally identified as management prerogatives. However, they are not absolute prerogatives. They are subject to limitations found in law, a collective bargaining agreement, or general principles of fair play and justice (University of Sto. Tomas vs. NLRC, 190 SCRA 758 [1990] citing Abbott Laboratories [Phil.], Inc. vs. NLRC, 154 SCRA 713 [1987]). The Corporation's assertion that it was exercising a management prerogative in hiring outside workers being contrary to the contract of employment which, of necessity, states the expected wages of the workers, as well as the CBA, is therefore untenable. Private respondent's failure to traverse petitioners' allegations that the NLRC abused its discretion in holding that the provision on grievance procedure had not been exhausted clearly sustains such allegation and upholds the petitioners' contention that the Corporation refused to undergo said procedure. It should be remembered that a grievance procedure is part of the continuous process of collective bargaining (Republic Savings Bank. vs. CIR, et al., 21 SCRA 226 [1967]). It is intended to promote a friendly dialogue between labor and management as a means of maintaining industrial peace. The Corporation's refusal to heed petitioners' request to undergo the grievance procedure clearly demonstrated its lack of intent to abide by the terms of the CBA.

Anent the NLRC's finding that Abulencia's offer to return to work is conditional, even a cursory reading of the letter aforequoted would reveal that no conditions had been set by petitioners. It is incongruous to consider as a "condition" the statement therein that the parties would continue talks for a peaceful working relationship ("tuloy tuloy ang ating pag-uusap sa ikatitiwasay ng ating relasyon"). Conferences form part of the grievance procedure and their mere mention in Abulencia's letter did not make the same "conditional". In the same manner, the following findings of the Labor Arbiter showed the illegal breakup of the picket lines by the CAPCOM: d) On 28 July 1987, CAPCOM soldiers, on surveillance mission, arrived at the picket line of respondents and searches were made on reported deadly weapons and firearms in the possession of the strikers. Several bladed weapons and firearms in the possession of the strikers were confiscated by the CAPCOM soldiers, as a result of which, the apprehended strikers were brought to Camp Tomas Karingal in Quezon City for proper investigation and filing of the appropriate criminal charges against them. The strikers who were charged of illegal possession of deadly weapon and firearms were: Edgar Aranes, Wilfredo Abulencia, Ernesto dela Cruz, Beato Abogado, Lopito Saranilla, Restituto Payabyab, Jose Borromeo and Rogelio Cabana. Criminal informations were filed by Inquest Fiscal, marked as Exhibits "E", "E-1 to E-8". These strikers were jailed for sometime until they were ordered release after putting up the required bail bond. Other strikers were also arrested and brought to Camp Tomas Karingal, and after proper investigation as to their involvement in the offense charged, they were released for lack of prima facie evidence. They were Edwin Velarde, Bayani Perez, Daniel Bacolon, Jesus Moises, Robert Aspurias and Benigno Barcena. After the strikers who were arrested were brought to Camp Tomas Karingal on 28 July 1987, the rest of the strikers removed voluntarily their human and material barricades which were placed and posted at the road leading to the premises of the Company. (Rollo, p. 32) The bringing in of CAPCOM soldiers to the peaceful picket lines without any reported outbreak of violence, was clearly in violation of the following prohibited activity under Article 264 of the Labor Code: (d) No public official or employee, including officers and personnel of the New Armed Forces of the Philippines or the Integrated National Police, or armed person, shall bring in, introduce or escort in any manner any individual who seeks to replace strikers in entering or leaving the premises of a strike area, or work in place of the strikers. The police force shall keep out of the picket lines unless actual violence or other criminal acts occur therein; Provided, That nothing herein shall be interpreted to prevent any public officer from taking any measure necessary to maintain peace and order, protect life and property, and/or enforce the law and legal order. (Emphasis supplied.) As the Labor Arbiter himself found, no pervasive or widespread coercion or violence were perpetrated by the petitioners as to warrant the presence of the CAPCOM soldiers in the picket lines. In this regard, worth quoting is the following excerpt of the decision in Shell Oil Workers' Union vs. Shell Company of the Philippines, Ltd., 39 SCRA 276 [1971], which was decided by the Court under the old Industrial Peace Act but which excerpt still holds true: . . . What is clearly within the law is the concerted activity of cessation of work in order that . . . employer cease and desist from an unfair labor practice. That the law recognizes as a right. There is though a disapproval of the utilization of force to attain such an objective. For implicit in the very concept of the legal order is the maintenance of peaceful ways. A strike otherwise valid, if violent in character, may be placed beyond the pale. Care is to be taken, however, especially where an unfair labor practice is involved, to avoid stamping it with illegality just because it is tainted with such acts. To avoid rendering illusory the recognition of the right to strike, responsibility in such a case should be individual and not collective. A different conclusion would be called for, of course, if the existence of force while the strike lasts is pervasive and widespread, consistently and deliberately resorted to as a matter of policy. It could be reasonably concluded then that even if justified as to ends, it becomes illegal because of the means employed. (at p. 292.) All told, the strike staged by the petitioners was a legal one even though it may have been called to offset what the strikers believed in good faith to be unfair labor practices on the part of the employer (Ferrer, et al. vs. Court of Industrial Relations, et al., 17 SCRA 352 [1966]). Verily, such presumption of legality prevails even if the allegations of unfair labor practices are subsequently found out to be untrue (People's Industrial and Commercial Employees and Workers Org. [FFW] vs. People's Industrial and Commercial Corporation, 112 SCRA 440 [1982]). Consonant with these jurisprudential pronouncements, is Article 263 of the Labor Code which clearly states "the policy of the State to encourage free trade unionism and free collective bargaining". Paragraph (b) of the same article guarantees the workers' "right to engage in concerted activities for purposes of collective bargaining or for their mutual benefit and protection" and recognizes the "right of legitimate labor organizations to strike and picket and of employers to lockout" so long as these actions are "consistent with the national interest" and the grounds therefor do not involve inter-union and intra-union disputes. The strike being legal, the NLRC gravely abused its discretion in terminating the employment of the individual petitioners, who, by operation of law, are entitled to reinstatement with three years backwages. Republic Act No. 6715 which amended Art. 279 of the Labor Code by giving "full backwages inclusive of allowances" to reinstated employees, took effect fifteen days from the publication of the law on March 21, 1989. The decision of the Labor Arbiter having been promulgated on March 16, 1988, the law is not applicable in this case. WHEREFORE, the questioned decision and resolution of the NLRC as well as the decision of the Labor Arbiter are hereby SET ASIDE and the individual petitioners are reinstated to their positions, with three years backwages and without loss of seniority rights and other privileges. Further, respondent corporation is ordered to desist from subcontracting work usually performed by its regular workers. SO ORDERED.

aa. G.R. No. L-17038

July 31, 1964

CONSOLIDATED LABOR ASSOCIATION OF THE PHILS., petitioner, vs. MARSMAN and CO., INC., and the COURT OF INDUSTRIAL RELATIONS, respondents. -----------------------------

G.R. No. L-17057

July 31, 1964

MARSMAN and Co., INC., petitioner, vs. CONSOLIDATED LABOR ASSOCIATION OF THE PHILIPPINES HON. JOSE S. BAUTISTA HON. ARSENIO I. MARTINEZ, HON. BALTAZAR M. VILLANUEVA, and HON. EMILIANO C. TABIGNE, respondents. Salvador H. Laurel and Apolonio V. Santiago for petitioner. Jose C. Espinas and Associates for respondent Consolidated Labor Association of the Philippines. CIR Legal Division for respondent Judges. MAKALINTAL, J.: In the Court of Industrial Relations, Marsman & Co., Inc., hereinafter referred to as the Company, was charged with unfair labor practice committed against sixtynine officers and members of the Marsman & Company Employees and Laborers Association (hereinafter referred to as MARCELA or simply as the Union). The Court (Judge Jose S. Bautista), after hearing, found the Company guilty of the charge and ordered it to reinstate 60 of the aforementioned 69 complainants to their former positions or to similar ones with the same rate of pay, without back wages. On motions for reconsideration filed by the Union and by the Company, respectively, the Court en banc affirmed the decision — with Judge Arsenio I. Martinez concurring in the result Judge Baltazar M. Villanueva also concurring in the result in a special opinion; Judge Emiliano C. Tabigne filing a separate concurring and dissenting opinion; and Judge Amando C. Bugayong taking no part. Both the Union and the Company appealed. The former claims that the 60 reinstated employees should be granted backpay (G.R. No. L-17038) while the latter questions the Industrial Court's finding of unfair labor practice (G.R. No. L-17057). The facts, as found by the Industrial Court, are: The Company had in its employ approximately 320 persons, about 140 of whom where members of MARCELA and about 20 of the National Labor Union. On December 23, 1953 the Industrial Court named MARCELA as the employees' bargaining agent in regard to rates of pay, terms and conditions of employment. At that time MARCELA was affiliated with the Federation of Free Workers, or FFW, a national labor organization. On March 17, 1954 MARCELA-FFW submitted to the Company a set of proposals for collective bargaining, which the Company answered on March 24, 1954. In spite of negotiations held between the Company and the Union, they failed to reach In agreement; so on April 8, 1954 the Union, failed a notice of strike with the Department of Labor. Mediation by the Conciliation Service of that Department proved fruitless. Wherefore, the parties respectfully pray that the foregoing stipulation of facts be admitted and approved by this Honorable Court, without prejudice to the parties adducing other evidence to prove their case not covered by this stipulation of facts. 1äw phï1.ñët

On June 4, 1954 the Union declared a strike and at the same time placed a "round-the-clock" picket line around the Company's premises in Intramuros, Manila. The tense situation in the strike zone prompted the Manila Police Department to send policemen thereto to preserve peace. Meanwhile the Labor Department's Conciliation Service continued to mediate between the representatives of the Union and of the Company. On July 21, 1954 some 50 employees, of whom nine were members of the National Labor Union and one a member of MARCELA, entered the Company premises under police escort in order to return to work. On July 30, 1954, in a conference called by Eleuterio Adevoso, then Secretary of Labor, the Union officials and members then present were prevailed upon by Adevoso to accept the proposals of Antonio de las Alas, Company vice-president, that they stop the strike and go back to work, and that when they were already working the Company would discuss with them their demands. Upon being informed to the Union's acceptance of the proposal the strikers returned to work. The Company admitted back sixteen picketing strikers on August 9, 1954 and later on, it also reemployed non-union employees and a majority of the strikers. However, complainants herein were refused admittance and were informed by Company officials that they would not be reinstated unless they ceased to be active Union members and that in any case the Company already had enough men for its business operations. As a result the strike and the picketing were resumed, because of which employees who had been admitted to work since July 21, 1954 had to stay inside the Company premises, where the Company furnished them food and quarters up to October 1954. Nevertheless some of those employed could go in and out after office hours to visit their families. During the strike, some of the picketers and some non-strikers were arrested within the strike zone for having committed unlawful acts, and were duly charged therewith. A petition for writ of injunction filed by the Company against MARCELA and its president, Buenaventura Bacay, on the ground that the strike and picket were being maintained illegally, was denied by the Court of First Instance of Manila, which pointed out that proper criminal complaints should have been filed against the individual strikers in the corresponding courts. Because of the Company's consistent refusal to reinstate the 69 complainants even after repeated requests, the Confederation of Labor Associations of the Philippines (CLAP), to which the Union had affiliated after seceding from the FFW initiated the present charge for unfair labor practice. Initially the strike staged by the Union was meant to compel the Company to grant it certain economic benefits set forth in its proposal for collective bargaining. The strike was an economic one,1 and the striking employees would have a tight to be reinstated if, in the interim, the employer had not hired other permanent workers to replace them. For it is recognized that during the pendency of an economic strike an employer may take steps to continue and protect his business by supplying places left vacant by the strikers, and is not bound to discharge those hired for that purpose upon election of the strikers to resume their employment.2 But the strike changed its character from the time the Company refused to reinstate complainants because of their union activities after it had offered to admit all the strikers and in fact did readmit the others. It was then converted into an unfair labor practice strike. The Company disputes the Industrial Court's findings that (1) it offered to reinstate all the strikers; (2) the complainants made a timely acceptance of the offer; and (3) the Company's refusal to reinstate complainants was for the purpose of discouraging union activities.

Substantial evidence supports the findings of fact of the Court of Industrial Relations. Complainants Teodoro Bacalzo, Raymundo Mostoles-Cruz, Mariano Bautista, and Godofredo Garcia testified thus: They were all present at the July 30, 1954 conference called by then Labor Secretary Eleuterio Adevoso in order to settle the differences between the Company and the Union. It was during this conference that Antonio de las Alas, then the Company's vice-president, offered to take back all the strikers if they would only stop the strike and as further inducement promised that the Union's demands would be discussed when the strikers were already working. Adevoso convinced the Union officers and members who were present to accept De las Alas' proposal. The lower court's reasons, we think, amply answer the Company's contention that De las Alas could not, by his offer, have bound the Company because it was Velilla, and not he, who had the authority to deal with the strikers: The denial of respondent that Antonio de las Alas was not authorized by the Company but Amando L. Velilla to deal with the union with respect to the strike is not worthy of belief. First, because then De las Alas was an executive Vice-President while Velilla was only the Secretary of the Company; second, while respondent wants to impress this Court that Velilla's authority to deal with the strikers was virtue of the Board resolution, such document was not presented in Court and third not even De las Alas was presented to make the denial. The Company claims that the complainants applied for readmission only on June 7, 1955, more than a year after the offer, when the CLAP, in their behalf, wrote the Company asking for their reinstatement. Prior to said letter, however, complainants had, by various means, sought readmission. After De las Alas' invitation to return to work was accepted by the Union officers and members, they informed all the other strikers accordingly. Thereupon the strikers terminated the strike and presented themselves for work at the Company's premises. Eighty one of the strikers were allowed to come back. But the Company's security guards, upon instructions of the Company officials, barred the entrance when complainants attempted to enter, and informed them that they had to write individual letters of application. So complainants complied with this requirement. It appears that the applications were scrutinized by a committee of employees composed of Salvador Bantique assistant accountant of the mines division; Mariano Lee, purchasing agent; Juan de Vera, paymaster; and Regina Cruz, accountant. Then the applications were further screened by a personnel committee composed of Jan H. Marsman, Antonio de las Alas, Charles G. Herdman and Amando Velilla. None of the sixty-nine applications met with favorable action by either committee. In addition to writing formal letters of application a number of complainants phoned while others personally approached their respective chiefs of department in the Company. Some also went to see Salvador Bantique, chairman of the screening committee, and expressed their desire to work. Bantique, however, upon learning that the strikers, among them Eulogio Labrador, were still active union members, informed them that they should first disaffiliate from the union in order to be reinstated. Furthermore, Amando Velilla, when approached by a group of complainants, told the latter that they had been away for a long time; that the Company had enough employees and did not need additional help; that some of those whom he had invited to return refused; and that by that time (August, 1954) it was already too late for them to wish to return. The Company alleges that it was economic reasons, i.e., its policy of retrenchment, not labor discrimination, which prevented it from rehiring complainants. This is disproved, however, by the fact that it not only readmitted the other strikers, but also hired new employees and even increased the salaries of its personnel by almost 50%. We are convinced that it was not business exigency but a desire to discourage union activities which prompted the Company to deny readmittance to complainants. This is an indubitable case of unfair labor practice. The strike was illegal of purpose, the Company insists, first, because it was staged for a trifling reason; and second, the union demands, which had precipitated the strikes, were already covered by an Industrial Court judgment, for the alteration, modification or setting aside of which a certain procedure has to be followed. The Union began the strike because it believed in good faith that settlement of their demands was at an impasse and that further negotiations would only come to naught. It stopped the strike upon the belief they could go back to work. Then it renewed the strike (or it started a new strike) as a protest against the discrimination practiced by the Company. Both are valid grounds for going on a strike. It is true that on August 14, 1952 the Industrial Court promulgated a decision in CIR Case No. 571-V, Marsman and Company Employees and Labors Association (MARCELA-FFW) v. Marsman and Company, Inc. However, except for the demand for general salary increases, the demands in said labor case were different from the demands which the Union made before it went on strike. For this reason, it did not have to ask modification of the aforementioned judgment. It had only to give the proper strike notice, as in fact it did. The Company further argues that since the methods used by the strikers were illegal, it had the right to refuse them readmission. Of the 69 complainants, nine, namely Alejandro Mojar, Manuel Mazo, Esteban Borja, Cecilio Walo, Eugenio Valenzuela, Elias Matic, Marcos Buccat, Malisimo Vargas and Ricardo Antonio, were charged with and convicted of various crimes like coercion, malicious mischief, physical injuries, breach of the peace, light threats, and damage to property, all committed during the period from September 4, 1954 to October 12, 1954. Admittedly, the Company could not have condoned these acts which were committed after it had offered to reinstate the strikers. Nevertheless, as the lower court reasoned out, it does not appear that the aforementioned individual acts were authorized or even impliedly sanctioned by the Union. Hence, the other strikers who were innocent of and did not participate in the illegal acts should not be punished by being deprived of their right of reinstatement. It is only those who had been found guilty who should be penalized by the loss of the right.3 We now come to the question of backpay. In an economic strike, the strikers are not entitled to backpay, since the employer should get the equivalent day's work for what he pays his employees. During the time that the strike was an economic one, complainants had no right to back pay. The Industrial Court could not have made a finding of unfair labor practice with respect to such time, as none had so far been committed. This being an unfair labor practice case, it cannot, therefore, order reinstatement much less back pay for that period.4 On the other hand, even after the court has made a finding of unfair labor practice, it still has the discretion to determine whether or not to grant back pay. Such discretion was not abused when it denied back wages to complainants, considering the climate of violence which attended the strike and picket that the complainants conducted. While the complainants ordered reinstated did not actively take part in the acts of violence, their minatory attitude towards the Company may be gathered from the fact that from the very first day of the strike policemen had to patrol the strike zone in order to preserve peace. WHEREFORE, the judgment appealed from is affirmed, without costs.

BB.

ELIZABETH C. BASCON and NOEMI V. COLE, petitioners, vs. HONORABLE COURT OF APPEALS, METRO CEBU

COMMUNITY HOSPITAL, IYOY, respondents.

INC.,

and

GREGORIO

DECISION QUISUMBING, J.:

This petition for review on certiorari assails the Court of Appeals Decision in CA-G.R. SP No. 51690, dated March 13, 2000, which set aside the decision of the National Labor Relations Commission (NLRC), 4 th Division, dated November 25, 1998, in NLRC Case No. V-00234-97. The NLRC had reversed the judgment of the Labor Arbiter, dated April 24, 1997, in NLRCRAB-VII Case No. 07-0828-96, which held valid herein petitioners dismissal from employment. Petitioners also challenge the appellate courts Resolution, dated August 9, 2000, which denied their motion for reconsideration. [1]

[2]

The petitioners in the instant case were employees of private respondent Metro Cebu Community Hospital, Inc. (MCCH) and members of the Nagkahiusang Mamumuo sa Metro Cebu Community Hospital (NAMAMCCH), a labor union of MCCH employees. Petitioner Elizabeth C. Bascon had been employed as a nurse by respondent MCCH since May 1984. At the time of her termination from employment in April 1996, she already held the position of Head Nurse. The other petitioner, Noemi V. Cole, had been working as a nursing aide with MCCH since August 1974. Both petitioners were dismissed by the respondent hospital for allegedly participating in an illegal strike. The instant controversy arose from an intra-union conflict between the NAMA-MCCH and the National Labor Federation (NFL), the mother federation of NAMA-MCCH. In November 1995, NAMA-MCCH asked MCCH to renew their Collective Bargaining Agreement (CBA), which was set to expire on December 31, 1995. NFL, however, opposed this move by its local affiliate. Mindful of the apparent intra-union dispute, MCCH decided to defer the CBA negotiations until there was a determination as to which of said unions had the right to negotiate a new CBA. Believing that their union was the certified collective bargaining agent, the members and officers of NAMA-MCCH staged a series of mass actions inside MCCHs premises starting February 27, 1996. They marched around the hospital putting up streamers, placards and posters. On March 13 and 19, 1996, the Department of Labor and Employment (DOLE) office in Region 7 issued two (2) certifications stating that NAMA-

MCCH was not a registered labor organization. This finding, however, did not deter NAMA-MCCH from filing a notice of strike with the Region 7 Office of the National Conciliation and Mediation Board (NCMB). Said notice was, however, disregarded by the NCMB for want of legal personality of the union. Meanwhile, the MCCH management received reports that petitioners participated in NAMA-MCCHs mass actions. Consequently, notices were served on all union members, petitioners included, asking them to explain in writing why they were wearing red and black ribbons and roaming around the hospital with placards. In their collective response dated March 18, 1996, the union members, including petitioners, explained that wearing armbands and putting up placards was their answer to MCCHs illegal refusal to negotiate with NAMA-MCCH. Subsequently, on March 28, 1996, MCCH notified the petitioners that they were to be investigated for their activities in the mass actions, with the hearings being scheduled on March 28, 1996 and April 1, 1996. Petitioners, however, denied receiving said notices. In a notice dated April 8, 1996, MCCH ordered petitioners to desist from participating in the mass actions conducted in the hospital premises with a warning that non-compliance therewith would result in the imposition of disciplinary measures. Petitioners again claimed they did not receive said order. Petitioners Bascon and Cole were then served notices terminating their employment effective April 12, 1996 and April 19, 1996, respectively. The dismissal of petitioners did not deter NAMA-MCCH from staging more mass actions. The means of ingress to and egress from the hospital were blocked. Employees and patients, including emergency cases, were harassed, according to MCCH management, which also complained that mass actions held inside the hospital had created an atmosphere of animosity and violence, aggravating the condition of ailing patients. Furthermore, the hospital also suffered heavy losses brought about by a notable decline in the patient admission rates and the refusal of suppliers to extend credit. To address its labor problems, MCCH sought an injunction from the NLRC on July 9, 1996 in Injunction Case No. V-0006-96. Meanwhile, on July 1, 1996, Bascon and Cole filed a complaint for illegal dismissal, docketed as NLRC-RAB-VII Case No. 07-0828-96. They denied having participated in said mass actions or having received the notices (1) enjoining them from wearing armbands and putting up placards, with warning that disciplinary measure would be imposed, and (2) informing them of the schedule of hearing. They admit, however, to wearing armbands for union identity while nursing patients as per instruction of their union leaders.

On July 16, 1996, a Temporary Restraining Order (TRO) was duly issued in Injunction Case No. V-0006-96. On August 27, 1996, the local government of Cebu City ordered the demolition of the picket staged by the members of NAMA-MCCH for being both a public nuisance and a nuisance per se. On September 18, 1996, the injunction was made permanent by an NLRC Resolution in Injunction Case No. V-0006-96, the fallo of which reads: WHEREFORE, premises considered, the petition for injunction is hereby GRANTED enjoining respondents in the course of their strike/picket from committing the illegal acts mentioned in Article 264 (e) of the Labor Code more particularly the blocking of the free ingress to and egress from petitioner hospital and from committing threats, coercion and intimidation of the non-striking/picketing employees/workers reporting for work, vehicles/patients desiring to enter for the purpose of seeking admission/confinement in petitioner hospital and for such other lawful purpose. SO ORDERED.

[3]

In a Decision dated April 24, 1997, the Labor Arbiter found the termination complained of in NLRC-RAB-VII Case No. 07-0828-96 to be valid and legal, and dismissed the complaint. The Labor Arbiter held that petitioners were justly dismissed because they actually participated in the illegal mass action. It also concluded that petitioners received the notices of hearing, but deliberately refused to attend the scheduled investigation. [4]

Petitioners then appealed the Labor Arbiters ruling to the NLRC, 4 Division, which docketed the appeal as NLRC Case No. V-00234-97. th

In its Decision dated November 25, 1998, the NLRC, 4th Division reversed the ruling of the Labor Arbiter and ordered the reinstatement of petitioners with full backwages. First, it found that petitioners merely wore armbands for union identity, per instruction of their union officials. Said wearing of armbands while nursing patients, is a constitutional right, which cannot be curtailed if peacefully carried out. Second, it ruled that the placards complained of by MCCH did not contain scurrilous, indecent or libelous remarks. Finally, it concluded that, in a belated but crude attempt to camouflage the illegal dismissal of petitioners, MCCH merely fabricated the notices allegedly sent to petitioners. [5]

Anent the charge of gross insubordination, the NLRC ruled that petitioners were not guilty thereof, because the elements thereof had not been sufficiently proven, to wit: (1) reasonableness and lawfulness of the order or directive, (2)

sufficiency of knowledge on the part of the employee of such order, and (3) the connection of the order with the duties which the employee had been engaged to discharge. Unconvinced of the correctness of the NLRC decision, MCCH filed a motion for reconsideration presenting the following documentary evidence: 1) Affidavits of Paz Velasco, Luciano Quitoy, Joseph Dagatan, and Gina Jumao-as to show that petitioners were duly served the notices in question; 2) Letter reply of NAMA-MCCH dated March 18, 1996 wherein petitioners, together with the rest of the union members, collectively acknowledged receipt of the March 15, 1996 directive; 3) Position Paper of terminated co-employees where the receipt of the subject notices were admitted as well as the commission of the aforementioned protest mass actions; and 4) Appeal of private respondents, who did not join the protest mass action, to the Board of Trustees of MCCH to show that reinstatement is no longer feasible in view of strained relationship. On February 4, 1999, the NLRC denied the plea for reconsideration of MCCH. Undeterred, MCCH filed a special civil action for certiorari under Rule 65 of the 1997 Rules of Civil Procedure before the Court of Appeals, docketed as CA-G.R. SP No. 51690. In its Decision dated March 13, 2000, the Court of Appeals decided CAG.R. SP No. 51690 as follows: [6]

WHEREFORE, the petition is granted. The Decision of public respondent NLRC 4th Division dated November 25, 1998 in NLRC Case No. V-00234-97 is hereby REVERSED and the complaint of private respondents is dismissed for lack of merit. Petitioner Metro Cebu Community Hospital (MCCH) is however ordered to pay the private respondents separation pay equivalent to one-half month for every year of service in the interest of equity. No costs. SO ORDERED.

[7]

The appellate court held that Bascon and Cole were validly terminated for their gross insubordination or willful disobedience as: 1) The order for petitioners to refrain from wearing armbands and putting up placards was legal, fair and reasonable. 2) The order was connected with the duties, which the petitioners had been engaged to discharge. 3) Said order was sufficiently made known to petitioners as receipt of the same by the latter was convincingly substantiated by hard evidence.

The appellate court stressed that petitioners gross insubordination constituted unlawful acts undertaken in conjunction with an illegal mass concerted action akin to an illegal strike. Finally, the Court of Appeals ruled that petitioners union activities violated the rights of patients and third parties such that they were outside the ambit of legality and beyond the mantle of protection of the freedom of speech. Hence, the instant case, with the petitioners submitting for resolution the following issues: I

CAN THE HONORABLE COURT OF APPEALS SUPPLANT ITS FINDINGS OF FACTS WITH THAT OF THE COMMISSION? II

CAN THE HONORABLE COURT OF APPEALS REVERSE THE DECISION OF THE COMMISSION ALTHOUGH THERE IS NO FINDING OF GRAVE ABUSE OF DISCRETION OR LACK OF JURISDICTION? III

CAN AN EMPLOYEE BE TERMINATED FOR INSUBORDINATION FOR IPSO FACTO NOT SHOWING UP FOR THE INVESTIGATION?

[8]

Anent the first and second issues, as a general rule, the findings of facts of the NLRC are deemed binding and conclusive upon the Court. We have repeatedly said that the Court is not a trier of facts. Thus, resort to judicial review of the decisions of the NLRC in a special civil action for certiorari under Rule 65 of the Rules of Court is generally limited to the question of grave abuse of discretion amounting to lack or excess of jurisdiction. However, where, as in the instant case, the findings of facts of the NLRC contradict those of the Labor Arbiter, a departure from the general rule is warranted. Thus, the Court may look into the records of the case and reexamine the [9]

questioned findings. Where the NLRC and the Labor Arbiter disagree on their finding of facts, the Court can review the records to determine which findings should be preferred as more conformable to the evidentiary facts. [10]

[11]

In St. Martin Funeral Home v. NLRC, we held that the special civil action of certiorari is the mode of judicial review of the decisions of the NLRC either by this Court or the Court of Appeals, but the latter court is the more appropriate forum in strict observance of the doctrine on the hierarchy of courts and that, in the exercise of this power, the Court of Appeals can review the factual findings or the legal conclusions of the NLRC. [12]

[13]

With regard to the third issue, note that petitioners were terminated for allegedly participating in an illegal strike and gross insubordination to the order prohibiting them from wearing armbands and putting up placards, not for ipso facto failing to show up in the scheduled investigation. Thus, the real issue is whether or not petitioners were validly terminated for (1) allegedly participating in an illegal strike and/or (2) gross insubordination to the order to stop wearing armbands and putting up placards. As to the first ground, Article 264 (a) of the Labor Code provides in part that: Any union officer who knowingly participates in illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment status (Emphasis ours) Thus, while a union officer can be terminated for mere participation in an illegal strike, an ordinary striking employee, like petitioners herein, must have participated in the commission of illegal acts during the strike (underscoring supplied). There must be proof that they committed illegal acts during the strike. But proof beyond reasonable doubt is not required. Substantial evidence, which may justify the imposition of the penalty of dismissal, may suffice. [14]

In this case, the Court of Appeals found that petitioners actual participation in the illegal strike was limited to wearing armbands and putting up placards. There was no finding that the armbands or the placards contained offensive words or symbols. Thus, neither such wearing of armbands nor said putting up of placards can be construed as an illegal act. In fact, per se, they are within the mantle of constitutional protection under freedom of speech. Evidence on record shows that various illegal acts were committed by unidentified union members in the course of the protracted mass action. And we commiserate with MCCH, patients, and third parties for the damage they

suffered. But we cannot hold petitioners responsible for acts they did not commit. The law, obviously solicitous of the welfare of the common worker, requires, before termination may be considered, that an ordinary union member must have knowingly participated in the commission of illegal acts during a strike. As regards the appellate courts finding that petitioners were justly terminated for gross insubordination or willful disobedience, Article 282 of the Labor Code provides in part: An employer may terminate an employment for any of the following causes: (a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or representative in connection with his work. However, willful disobedience of the employers lawful orders, as a just cause for dismissal of an employee, envisages the concurrence of at least two requisites: (1) the employee's assailed conduct must have been willful, that is, characterized by a wrongful and perverse attitude; and (2) the order violated must have been reasonable, lawful, made known to the employee and must pertain to the duties which he had been engaged to discharge. [15]

In this case, we find lacking the element of willfulness characterized by a perverse mental attitude on the part of petitioners in disobeying their employers order as to warrant the ultimate penalty of dismissal. Wearing armbands and putting up placards to express ones views without violating the rights of third parties, are legal per se and even constitutionally protected. Thus, MCCH could have done well to respect petitioners right to freedom of speech instead of threatening them with disciplinary action and eventually terminating them. Neither are we convinced that petitioners exercise of the right to freedom of speech should be taken in conjunction with the illegal acts committed by other union members in the course of the series of mass actions. It bears stressing that said illegal acts were committed by other union membersafter petitioners were already terminated, not during the time that the latter wore armbands and put up placards. Finally, even if willful disobedience may be properly appreciated, still, the penalty of dismissal is too harsh. Not every case of willful disobedience by an employee of a lawful work-connected order of the employer may be penalized with dismissal. There must be reasonable proportionality between, on the one hand, the willful disobedience by the employee and, on the other hand, the penalty imposed therefor. In this case, evidence is wanting on the depravity [16]

of conduct and willfulness of the disobedience on the part of petitioners, as contemplated by law. Wearing armbands to signify union membership and putting up placards to express their views cannot be of such great dimension as to warrant the extreme penalty of dismissal, especially considering the long years of service rendered by petitioners and the fact that they have not heretofore been subject of any disciplinary action in the course of their employment with MCCH. The termination of petitioners employment not being for any of the just or authorized causes, it constitutes illegal dismissal. Article 279 of the Labor Code, as amended, provides that: An employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages, inclusive of allowances, and to his other benefits or their monetary equivalent computed from the time his compensation was withheld from him up to the time of his actual reinstatement. Hence, illegally dismissed employees are entitled to both reinstatement and full backwages as a matter of course. MCCH alleges that due to strained relations, reinstatement is no longer possible. We disagree. In Quijano v. Mercury Drug Corporation, we stated that the doctrine of strained relations is inapplicable to a situation where the employee has no say in the operation of the employers business. Petitioners herein are nurse and nursing aide, respectively in MCCH and thus, have no prerogative in the operation of the business. As also held in the Mercury Drug case: [17]

To protect labors security of tenure, we emphasize that the doctrine of strained relations should be strictly applied so as not to deprive an illegally dismissed employee of his right to reinstatement. Every labor dispute almost always results in strained relations, and the phrase cannot be given an overarching interpretation, otherwise, an unjustly dismissed employee can never be reinstated. [18]

We cannot in our conscience allow MCCH to unjustly deny petitioners their lawful occupation, especially at this late point in their lives when it would be a near impossibility for them to find another employment. The employers power to dismiss must be tempered with the employees right to security of tenure. Time and again we have said that the preservation of the lifeblood of the toiling laborer comes before concern for business profits. Employers must be reminded to exercise the power to dismiss with great caution, for the State will not hesitate to come to the succor of workers wrongly dismissed by capricious employers.

WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals in CA-G.R. SP No. 51690 dated March 13, 2000 is REVERSED. Private respondent Metro Cebu Community Hospital is hereby ordered to reinstate petitioners Noemi V. Cole and Elizabeth C. Bascon without loss of seniority rights and other privileges and to pay them full backwages, inclusive of allowances, and other benefits computed from the time they were dismissed up to the time of their actual reinstatement. No pronouncement as to costs. SO ORDERED.

CC.

EDEN GLADYS ABARIA, G.R. No. 154113 ROMULO ALFORQUE, ELENA ALLA, EVELYN APOSTOL, AMELIA ARAGON, BEATRIZ ALBASTRO, GLORIA ARDULLES, GLENDA BANTILAN, VIRGILIE BORINAGA, ROLDAN CALDERON, ILDEBRANDO CUTA, ROMEO EMPUERTO, LANNIE FERNANDEZ, LUCINELL GABAYERON, JESUSA GERONA, JOSE GONZAGA, TEOFILO HINAMPAS, JOSEFINA IBUNA, MARLYN LABRA, MARIA CARMENCITA LAO, ERA CANEN, RODNEY REX LERIAS, ERNIE MANLIGAS, JOHANNE DEL MAR, RUBY ORIMACO, CONSTANCIO PAGADOR, MARVELOUS PANAL, NOLAN PANAL, LILLAN PETALLAR, GERNA PATIGDAS, MELODIA PAULIN, SHIRLEY ROSE REYES, JOSEFINA REYES,

OSCAR DE LOS SANTOS, SOLOMON DE LOS SANTOS, RAMON TAGNIPIS, BERNADETTE TIBAY, RONALD TUMULAK, LEONCIO VALLINAS, EDELBERTO VILLA and the NAGKAHIUSANG MAMUMUO SA METRO CEBU COMMUNITY HOSPITAL, Petitioners, - versus NATIONAL LABOR RELATIONS COMMISSION, METRO CEBU COMMUNITY HOSPITAL, INC., ITS BOARD OF TRUSTEES, REV. GREGORIO IYOY, SHIELA BUOT, REV. LORENZO GENOTIVA, RUBEN CARABAN, RUBEN ESTOYE, LILIA SAURO, REV. ELIZER BERTOLDO, RIZALINA VILLAGANTE, DRA. LUCIA FLORENDO, CONCEPCION VILLEGAS, REV. OLIVER CANEN, DRA. CYD RAGAS, REV. MIKE CAMBA, AVEDNIGO VALIENTE, RIZALINO TAGANAS, CIRIACO PONGASI, ISIAS WAGAS, REV. ESTER GELOAGAN, REV. LEON MANIWAN, CRESENTE BAOAS, WINEFREDA BARLOSO, REV. RUEL MARIGA AND THE UNITED CHURCH OF CHRIST IN THEPHILIPPINES, REV. HILARIO GOMEZ, REV. ELMER BOLOCON, THE NATIONAL FEDERATION OF LABOR AND ARMAND ALFORQUE,

Respondents. x- - - - - - - - - - - - - - - - - - - - - - - -x PERLA NAVA, DANIELA G.R. No. 187778 YOSORES, AGUSTIN ALFORNON, AILEEN CATACUTAN, ROLANDO REDILOSA, CORNELIO MARIBOJO, VIRGENCITA CASAS, CRISANTA GENEGABOAS, EMILIO LAO, RICO GASCON, ALBINA BAEZ, PEDRO CABATINGAN,PROCOMIO SALUPAN, ELIZABETH RAMON, DIOSCORO GABUNADA, ROY MALAZARTE, FELICIANITA MALAZARTE, NORBERTA CACA, MILAGROS CASTILLO, EDNA ALBO, BERNABE LUMAPGUID, CELIA SABAS, SILVERIO LAO, DARIO LABRADOR, ERNESTO CANEN, JR., ELSA BUCAO, HANNAH BONGCARAS, NEMA BELOCURA, PEPITO LLAGAS,GUILLERMA REMOCALDO, ROGELIO DABATOS, ROBERTO JAYMA, RAYMUNDO DELATADO, MERLYN NODADO, NOEL HORTELANO, HERMELO DELA TORRE, LOURDES OLARTE, DANILO ZAMORA, LUZ CABASE, CATALINA ALSADO, RUTH BANZON AND THE NAGKAHIUSANG MAMUMUO SAMETRO CEBU COMMUNITY HOSPITAL,

Petitioners, - versus NATIONAL LABOR RELATIONS COMMISSION (FOURTH DIVISION), METRO CEBU COMMUNITY HOSPITAL, INC., BOARD OF TRUSTEES, REV. GREGORIO IYOY, SHIELA BUOT, REV. LORENZO GENOTIVA, RUBEN CABABAN, ROSENDO ESTOYE, LILIA SAURO, REV. ELIZER BERTOLDO, RIZALINA VILLAGANTE, DRA. LUCIA FLORENDO, CONCEPCION VILLEGAS, REV. OLIVER CANEN, DRA. CYD RAAGAS, REV. MIKE CAMBA, AVIDNIGO VALIENTE, RIZALINO TAGANAS, CIRIACO PONGASI, ISIAS WAGAS, REV. ESTER GELOAGAN, REV. LEON MANIWAN, CRESENTE BAOAS, WINIFREDA BARLOSO, REV. RUEL MARIGA, THE UNITEDCHURCH OF CHRIST IN THEPHILIPPINES, REV. HILARIOGOMEZ, REV. ELMER BOLOCON, THE NATIONAL FEDERATION OF LABOR AND ARMANDO ALFORQUE, Respondents. x- - - - - - - - - - - - - - - - - - - - - - - -x METRO CEBU COMMUNITY G.R. No. 187861 HOSPITAL, presently known as Visayas Community Medical Center

(VCMC), Petitioner, - versus PERLA NAVA, DANIELA YOSORES, AGUSTIN ALFORNON, AILEEN CATACUTAN, ROLANDO REDILOSA, CORNELIO MARIBOJO, VIRGENCITA CASAS, CRISANTA GENEGABOAS, EMILIO LAO, RICO GASCON, ALBINA BANEZ, PEDRO CABATINGAN, PROCOMIO SALUPAN, ELIZABETH RAMON, DIOSCORO GABUNADA, ROY MALAZARTE, FELICIANITA MALAZARTE, NORBERTA CACA, MILAGROS CASTILLO, EDNA ALBO, BERNABE LUMABGUID, CELIA SABAS, SILVERIO LAO, DARIO LABRADOR, ERNESTO CANEN, JR., ELSA BUCAO, HANNAH BONGCARAS, NEMA BELOCURA, PEPITO LLAGAS, GUILLERMA REMOCALDO, ROGELIO DABATOS, ROBERTO JAYMA, RAYMUNDO DELATADO, NOEL HORTELANO, HERMELO DE LA TORRE, LOURDES OLARTE, DANILO ZAMORA, LUZ CABASE, CATALINA ALSADO AND RUTH BANZON, Respondents.

x- - - - - - - - - - - - - - - - - - - - - - - -x VISAYAS COMMUNITY MEDICAL CENTER (VCMC) formerly known as METRO CEBU COMMUNITY HOSPITAL (MCCH), Petitioner,

- versus -

G.R. No. 196156 Present: CORONA, C.J., Chairperson, LEONARDO-DE CASTRO, BERSAMIN, DEL CASTILLO, and VILLARAMA, JR., JJ.

ERMA YBALLE, NELIA ANGEL, Promulgated: ELEUTERIA CORTEZ and December 7, 2011 EVELYN ONG, Respondents. x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

DECISION VILLARAMA, JR., J.:

The consolidated petitions before us involve the legality of mass termination of hospital employees who participated in strike and picketing activities. The factual antecedents: Metro Cebu Community Hospital, Inc. (MCCHI), presently known as the Visayas Community Medical Center (VCMC), is a non-stock, non-profit corporation organized under the laws of the Republic of the Philippines. It operates the Metro Cebu Community Hospital (MCCH), a tertiary medical institution located at Osmea Boulevard, Cebu City. MCCH is owned by the United Church of Christ in the Philippines (UCCP) and Rev. Gregorio P. Iyoy is the Hospital Administrator. The National Federation of Labor (NFL) is the exclusive bargaining representative of the rank-and-file employees of MCCHI. Under the 1987 and 1991 Collective

Bargaining Agreements (CBAs), the signatories were Ciriaco B. Pongasi, Sr. for MCCHI, and Atty. Armando M. Alforque (NFL Legal Counsel) and Paterno A. Lumapguid as President of NFL-MCCH Chapter. In the CBA effective from January 1994 until December 31, 1995, the signatories were Sheila E. Buot as Board of Trustees Chairman, Rev. Iyoy as MCCH Administrator and Atty. Fernando Yu as Legal Counsel of NFL, while Perla Nava, President of Nagkahiusang Mamumuo sa MCCH (NAMA-MCCH-NFL) signed the Proof of Posting.[1] On December 6, 1995, Nava wrote Rev. Iyoy expressing the unions desire to renew the CBA, attaching to her letter a statement of proposals signed/endorsed by 153 union members. Nava subsequently requested that the following employees be allowed to avail of one-day union leave with pay on December 19, 1995: Celia Sabas, Jesusa Gerona, Albina Baez, Eddie Villa, Roy Malazarte, Ernesto Canen, Jr., Guillerma Remocaldo, Catalina Alsado, Evelyn Ong, Melodia Paulin, Sofia Bautista, Hannah Bongcaras, Ester Villarin, Iluminada Wenceslao and Perla Nava. However, MCCHI returned the CBA proposal for Nava to secure first the endorsement of the legal counsel of NFL as the official bargaining representative of MCCHI employees.[2] Meanwhile, Atty. Alforque informed MCCHI that the proposed CBA submitted by Nava was never referred to NFL and that NFL has not authorized any other legal counsel or any person for collective bargaining negotiations. By January 1996, the collection of union fees (check-off) was temporarily suspended by MCCHI in view of the existing conflict between the federation and its local affiliate. Thereafter, MCCHI attempted to take over the room being used as union office but was prevented to do so by Nava and her group who protested these actions and insisted that management directly negotiate with them for a new CBA. MCCHI referred the matter to Atty. Alforque, NFLs Regional Director, and advised Nava that their group is not recognized by NFL.[3] In his letter dated February 24, 1996 addressed to Nava, Ernesto Canen, Jr., Jesusa Gerona, Hannah Bongcaras, Emma Remocaldo, Catalina Alsado and Albina Baez, Atty. Alforque suspended their union membership for serious violation of the Constitution and By-Laws. Said letter states: During the last General Membership Meeting of the union on February 20, 1996, you openly declared that you recognized the officers of the KMU not those of the NFL, that you submit to the

stuctures [sic] and authority of the KMU not of the NFL, and that you are loyal only to the KMU not to the NFL. Also, in the same meeting, you admitted having sent a proposal for a renewed collective bargaining agreement to the management without any consultation with the NFL. In fact, in your letter dated February 21, 1996 addressed to Rev. Gregorio Iyoy, the Administrator of the hospital, you categorically stated as follows: We do not need any endorsement from NFL, more particularly from Atty. Armando Alforque to negotiate our CBA with MCCH. You did not only ignore the authority of the undersigned as Regional Director but you maliciously prevented and bluntly refused my request to join the union negotiating panel in the CBA negotiations. Your above flagrant actuations, made in the presence of the union membership, constitute the following offenses: 1. Willful violation of the Constitution and By-Laws of the Federation and the orders and decisions of duly constituted authorities of the same (Section 4 (b), Article III), namely: a) Defying the decision of the organization disaffiliating from the KMU; and b) Section 9 (b), Article IX which pertains to the powers and responsibilities of the Regional Director, particularly, to negotiate and sign collective bargaining agreement together with the local negotiating panel subject to prior ratification by the general membership; 2. Joining or assisting another labor organization or helping in the formation of a new labor organization that seeks or tends to defeat the purpose of the Federation (Section 4 (d), Article III) in relation to the National Executive Boards Resolution No. 8, September 26-27, 1994, to wit: Pursuant to the NEB Resolution disaffiliating from the KMU dated September 11, 1993, the NEB in session hereby declare that KMU is deemed an organization that seeks to defeat the objective of establishing independent and democratic unions and seeks to replace the Federation as exclusive representative of its members.

Committing acts that tend to alienate the loyalty of the members to the Federation, subvert its duly constituted authorities, and divide the organization in any level with the objective of establishing a pro-KMU faction or independent union loyal to the KMU shall be subject to disciplinary action, suspension or expulsion from union membership, office or position in accordance with paragraph[s] d and f of Section 4, Article III, and paragraph h, Section 6, Article VI, paragraph d, Section 9, Article IX. You are, therefore, directed to submit written explanation on the above charges within five (5) days from receipt hereof. Failure on your part shall be considered a waiver of your right to be heard and the Federation will act accordingly. Considering the gravity of the charges against you, the critical nature of the undertaking to renew the collective bargaining agreement, and the serious threat you posed to the organization, you are hereby placed under temporary suspension from your office and membership in the union immediately upon receipt hereof pending investigation and final disposition of your case in accordance with the unions constitution and by-laws. For your guidance and compliance.[4]

On February 26, 1996, upon the request of Atty. Alforque, MCCHI granted oneday union leave with pay for 12 union members.[5] The next day, several union members led by Nava and her group launched a series of mass actions such as wearing black and red armbands/headbands, marching around the hospital premises and putting up placards, posters and streamers. Atty. Alforque immediately disowned the concerted activities being carried out by union members which are not sanctioned by NFL. MCCHI directed the union officers led by Nava to submit within 48 hours a written explanation why they should not be terminated for having engaged in illegal concerted activities amounting to strike, and placed them under immediate preventive suspension. Responding to this directive, Nava and her group denied there was a temporary stoppage of work, explaining that employees wore their armbands only as a sign of protest and reiterating their demand for MCCHI to comply with its duty to bargain collectively. Rev. Iyoy, having been informed that Nava and her group have also been suspended by NFL, directed said officers to appear before his office for investigation in connection with the illegal strike wherein they reportedly uttered slanderous and

scurrilous words against the officers of the hospital, threatening other workers and forcing them to join the strike. Said union officers, however, invoked the grievance procedure provided in the CBA to settle the dispute between management and the union.[6] On March 13 and 19, 1996, the Department of Labor and Employment (DOLE) Regional Office No. 7 issued certifications stating that there is nothing in their records which shows that NAMA-MCCH-NFL is a registered labor organization, and that said union submitted only a copy of its Charter Certificate on January 31, 1995.[7] MCCHI then sent individual notices to all union members asking them to submit within 72 hours a written explanation why they should not be terminated for having supported the illegal concerted activities of NAMA-MCCH-NFL which has no legal personality as per DOLE records. In their collective response/statement dated March 18, 1996, it was explained that the picketing employees wore armbands to protest MCCHIs refusal to bargain; it was also contended that MCCHI cannot question the legal personality of the union which had actively assisted in CBA negotiations and implementation.[8] On March 13, 1996, NAMA-MCCH-NFL filed a Notice of Strike but the same was deemed not filed for want of legal personality on the part of the filer. The National Conciliation and Mediation Board (NCMB) Region 7 office likewise denied their motion for reconsideration on March 25, 1996. Despite such rebuff, Nava and her group still conducted a strike vote on April 2, 1996 during which an overwhelming majority of union members approved the strike.[9] Meanwhile, the scheduled investigations did not push through because the striking union members insisted on attending the same only as a group. MCCHI again sent notices informing them that their refusal to submit to investigation is deemed a waiver of their right to explain their side and management shall proceed to impose proper disciplinary action under the circumstances. On March 30, 1996, MCCHI sent termination letters to union leaders and other members who participated in the strike and picketing activities. On April 8, 1996, it also issued a cease-and-desist order to the rest of the striking employees stressing that the wildcat concerted activities spearheaded by the Nava group is illegal without a valid Notice of Strike and warning them that non-compliance will compel management to impose disciplinary actions against them. For their continued picketing activities despite the said warning, more than 100 striking employees were dismissed effective April 12 and 19, 1996.

Unfazed, the striking union members held more mass actions. The means of ingress to and egress from the hospital were blocked so that vehicles carrying patients and employees were barred from entering the premises. Placards were placed at the hospitals entrance gate stating: Please proceed to another hospital and we are on protest. Employees and patients reported acts of intimidation and harassment perpetrated by union leaders and members. With the intensified atmosphere of violence and animosity within the hospital premises as a result of continued protest activities by union members, MCCHI suffered heavy losses due to low patient admission rates. The hospitals suppliers also refused to make further deliveries on credit. With the volatile situation adversely affecting hospital operations and the condition of confined patients, MCCHI filed a petition for injunction in the NLRC (Cebu City) on July 9, 1996 (Injunction Case No. V-0006-96). A temporary restraining order (TRO) was issued on July 16, 1996. MCCHI presented 12 witnesses (hospital employees and patients), including a security guard who was stabbed by an identified sympathizer while in the company of Navas group. MCCHIs petition was granted and a permanent injunction was issued on September 18, 1996 enjoining the Nava group from committing illegal acts mentioned in Art. 264 of the Labor Code.[10] On August 27, 1996, the City Government of Cebu ordered the demolition of the structures and obstructions put up by the picketing employees of MCCHI along the sidewalk, having determined the same as a public nuisance or nuisance per se.[11] Thereafter, several complaints for illegal dismissal and unfair labor practice were filed by the terminated employees against MCCHI, Rev. Iyoy, UCCP and members of the Board of Trustees of MCCHI. On August 4, 1999, Executive Labor Arbiter Reynoso A. Belarmino rendered his decision[12] dismissing the complaints for unfair labor practice in NLRC Case Nos. RAB-VII-02-0309-98, RAB-VII-02-0394-98 and RAB-VII-030596-98 filed by Nava and 90 other complainants. Executive Labor Arbiter Belarmino found no basis for the charge of unfair labor practice and declared the strike and picketing activities illegal having been conducted by NAMA-MCCHNFL which is not a legitimate labor organization. The termination of union leaders Nava, Alsado, Baez, Bongcaras, Canen, Gerona and Remocaldo were upheld as valid but MCCHI was directed to grant separation pay equivalent to one-half

month for every year of service, in the total amount of P3,085,897.40 for the 84 complainants.[13] Complainants appealed to the Commission. On March 14, 2001, the NLRCs Fourth Division rendered its Decision,[14] the dispositive portion of which reads: WHEREFORE, premises considered, the decision of the Executive Labor Arbiter dismissing the complaint for unfair labor practice and illegal dismissal is AFFIRMED with MODIFICATIONS declaring the dismissal of all the complainants in RAB Case No. 07-020394-98 and RAB Case No. 07-03-0596-98 valid and legal. Necessarily, the award of separation pay and attorneys fees are hereby Deleted. Resolution on RAB Case No. 07-02-0309-98 is hereby Deferred upon Joint Motion of the parties. SO ORDERED.[15]

In its Resolution dated July 2, 2001, the NLRC denied complainants motion for reconsideration.[16] Complainants elevated the case to the Court of Appeals (CA) (Cebu Station) via a petition for certiorari, docketed as CA-G.R. SP No. 66540.[17] In its Resolution dated November 14, 2001, the CAs Eighth Division dismissed the petition on the ground that out of 88 petitioners only 47 have signed the certification against forum shopping.[18] Petitioners moved to reconsider the said dismissal arguing that the 47 signatories more than constitute the principal parties as the petition involves a matter of common concern to all the petitioning employees.[19] By Resolution[20] dated May 28, 2002, the CA reinstated the case only insofar as the 47 petitioners who signed the petition are concerned. Petitioners challenged the validity of the November 14, 2001 and May 28, 2002 resolutions before this Court in a petition for review on certiorari, docketed as G.R. No. 154113. Meanwhile, the NLRCs Fourth Division (Cebu City) rendered its Decision[21] dated March 12, 2003 in RAB Case Nos. 07-02-0309-98 (NLRC Case No. V-001042-99) pertaining to complainants Erma Yballe, Evelyn Ong, Nelia Angel and Eleuteria Cortez as follows:

WHEREFORE, premises considered, the decision of the Executive Labor Arbiter dismissing the complaint for unfair labor practice and illegal dismissal is AFFIRMED with MODIFICATIONS declaring all complainants to have been validly dismissed. Necessarily, the award of separation pay and attorneys fees are hereby Deleted. SO ORDERED.[22]

The NLRC likewise denied the motion for reconsideration filed by complainants Yballe, et al. in its Resolution dated April 13, 2004.[23] On October 17, 2008, the CA rendered its Decision[24] in CA-G.R. SP No. 66540, the dispositive portion of which states: WHEREFORE, premises considered, judgment is hereby rendered AFFIRMING the Decision of the National Labor Relations Commission (NLRC) Fourth Division dated March 14, 2001 in NLRC Case No. V001042-99, WITH MODIFICATIONS to the effect that (1) the petitioners, except the union officers, shall be awarded separation pay equivalent to one-half (1/2) month pay for every year of service, and (2) petitioner Cecilia Sabas shall be awarded overtime pay amounting to sixty-three (63) hours. SO ORDERED.[25]

Petitioners filed a motion for reconsideration while private respondents filed a motion for partial reconsideration questioning the award of separation pay. The former also invoked the decision of this Court in Bascon v. Court of Appeals,[26] while the latter argued for the application of the ruling in decision rendered by the CA (Cebu City) in Miculob v. NLRC, et al. (CA-G.R. SP No. 84538),[27] both involving similar complaints filed by dismissed employees of MCCHI. By Resolution[28] dated April 17, 2009, the CA denied both motions: WHEREFORE, the petitioners Motion for Reconsideration and the private respondent[s] Motion for Partial Reconsideration of the October 17, 2008 Decision are both DENIED for lack of merit.

The Motions for Substitution of Counsel and Compromise Agreements submitted by petitioners Bernardito Lawas, Avelina Bangalao, Dailenda Hinampas and Daylinda Tigo are hereby approved. Consequently, said petitioners are ordered dropped from the list of petitioners and the case is deemed dismissed as to them. SO ORDERED.[29]

Complainants Yballe, et al. also challenged before the CA the March 12, 2003 Decision and April 13, 2004 Resolution of the NLRC in a petition for certiorari, docketed as CA-G.R. SP No. 84998 (Cebu City). By Decision[30] dated November 7, 2008, the CA granted their petition, as follows: WHEREFORE, the challenged Decision of public respondent dated March 12, 2003 and its Resolution dated April 13, 2004 are hereby REVERSED AND SET ASIDE. Private respondent Metro Cebu Community Hospital is ordered to reinstate petitioners Erma Yballe, Eleuteria Cortes, Nelia Angel and Evelyn Ong without loss of seniority rights and other privileges; to pay them their full backwages inclusive of their allowances and other benefits computed from the time of their dismissal up to the time of their actual reinstatement. No pronouncement as to costs. SO ORDERED.[31]

Private respondents (MCCHI, et al.) moved to reconsider the above decision but the CA denied their motion on February 22, 2011.[32] Both petitioners and private respondents in CA-G.R. SP No. 66540 appealed to this Court. Private respondent MCCHI in CA-G.R. SP No. 84998, under its new name Visayas Community Medical Center (VCMC), filed a petition for certiorari in this Court. In G.R. No. 187778, petitioners Nava, et al. prayed that the CA decision be set aside and a new judgment be entered by this Court (1) declaring private respondents guilty of unfair labor practice and union busting; (2) directing private respondents to cease and desist from further committing unfair labor practices against the petitioners; (3) imposing upon MCCH the proposed CBA or, in the

alternative, directing the hospital and its officers to bargain with the local union; (4) declaring private respondents guilty of unlawfully suspending and illegally dismissing the individual petitioners-employees; (5) directing private respondents to reinstate petitioners-employees to their former positions, or their equivalent, without loss of seniority rights with full backwages and benefits until reinstatement; and (6) ordering private respondents to pay the petitioners moral damages, exemplary damages, legal interests, and attorneys fees.[33] On the other hand, petitioner MCCHI in G.R. No. 187861 prayed for the modification of the CA decision by deleting the award of separation pay and reinstating the March 14, 2001 decision of the NLRC.[34] In G.R. No. 196156, MCCHI/VCMC prayed for the annulment of the November 7, 2008 Decision and February 22, 2011 Resolution of the CA, for this Court to declare the dismissal of respondents Yballe, et al. as valid and legal and to reinstate the March 12, 2003 Decision and April 13, 2004 Resolution of the NLRC. G.R. No. 187861 was consolidated with G.R. Nos. 154113 and 187778 as they involve similar factual circumstances and identical or related issues. G.R. No. 196156 was later also consolidated with the aforesaid cases. The issues are: (1) whether the CA erred in dismissing the petition for certiorari (CA-G.R. SP No. 66540) with respect to the petitioners in G.R. No. 154113 for their failure to sign the certification against forum shopping; (2) whether MCCHI is guilty of unfair labor practice; (3) whether petitioning employees were illegally dismissed; and (4) if their termination was illegal, whether petitioning employees are entitled to separation pay, backwages, damages and attorneys fees. Dropping of petitioners who did not sign the certification against forum shopping improper

The Court has laid down the rule in Altres v. Empleo[35] as culled from jurisprudential pronouncements, that the certification against forum shopping must be signed by all the plaintiffs or petitioners in a case; otherwise, those who did not sign will be dropped as parties to the case. Under reasonable or justifiable circumstances, however, as when all the plaintiffs or petitioners share a common interest and invoke a common cause of action or defense, the signature of only one

of them in the certification against forum shopping substantially complies with the Rule. In the case at bar, the signatures of 47 out of 88 petitioning employees in the certification against forum shopping constitute substantial compliance with the rule. There is no question that they shared a common interest and invoked a common cause of action when they filed suit before the Labor Arbiter and NLRC questioning the validity of their termination and charging MCCHI with unfair labor practice. Thus, when they appealed their case to the CA, they pursued the same as a collective body, raising only one argument in support of their cause of action, i.e., the illegal dismissal allegedly committed by MCCHI when union members resorted to strike and mass actions due to MCCHIs refusal to bargain with officers of the local chapter. There is sufficient basis, therefore, for the 47 signatories to the petition, to speak for and in behalf of their co-petitioners and to file the Petition for Certiorari in the appellate court.[36] Clearly, the CA erred in dropping as parties-petitioners those who did not sign the certification against forum shopping. However, instead of remanding the case to the CA for it to resolve the petition with respect to the herein petitioners in G.R. No. 154113, and as prayed for, the Court shall consider them parties-petitioners in CA-G.R. SP No. 66540,which case has already been decided and now subject of appeal in G.R. No. 187778. MCCHI not guilty of unfair labor practice Art. 248 (g) of the Labor Code, as amended, makes it an unfair labor practice for an employer [t]o violate the duty to bargain collectively as prescribed by the Code. The applicable provision in this case is Art. 253 which provides: ART. 253. Duty to bargain collectively when there exists a collective bargaining agreement. When there is a collective bargaining agreement, the duty to bargain collectively shall also mean that neither party shall terminate nor modify such agreement during its lifetime. However, either party can serve a written notice to terminate or modify the agreement at least sixty (60) days prior to its expiration date. It shall be the duty of both parties to keep the status quo and to continue in full force and effect the terms and conditions of the existing agreement during the 60-day period and/or until a new agreement is reached by the parties.

NAMA-MCCH-NFL charged MCCHI with refusal to bargain collectively when the latter refused to meet and convene for purposes of collective bargaining, or at least give a counter-proposal to the proposed CBA the union had submitted and which was ratified by a majority of the union membership. MCCHI, on its part, deferred any negotiations until the local unions dispute with the national union federation (NFL) is resolved considering that the latter is the exclusive bargaining agent which represented the rank-and-file hospital employees in CBA negotiations since 1987. We rule for MCCHI. Records of the NCMB and DOLE Region 7 confirmed that NAMA-MCCH-NFL had not registered as a labor organization, having submitted only its charter certificate as an affiliate or local chapter of NFL.[37] Not being a legitimate labor organization, NAMA-MCCH-NFL is not entitled to those rights granted to a legitimate labor organization under Art. 242, specifically: (a) To act as the representative of its members for the purpose of collective bargaining; (b) To be certified as the exclusive representative of all the employees in an appropriate collective bargaining unit for purposes of collective bargaining; xxxx

Aside from the registration requirement, it is only the labor organization designated or selected by the majority of the employees in an appropriate collective bargaining unit which is the exclusive representative of the employees in such unit for the purpose of collective bargaining, as provided in Art. 255.[38] NAMA-MCCH-NFL is not the labor organization certified or designated by the majority of the rank-and-file hospital employees to represent them in the CBA negotiations but the NFL, as evidenced by CBAs concluded in 1987, 1991 and 1994. While it is true that a local union has the right to disaffiliate from the national federation, NAMA-MCCH-NFL has not done so as there was no any effort on its part to comply with the legal requisites for a valid disaffiliation during the freedom period[39] or the last 60 days of the last year of the CBA, through a majority vote in a secret balloting in accordance with Art. 241 (d). [40] Nava and her group simply demanded that MCCHI directly negotiate with the local union which has not even registered as one.

To prove majority support of the employees, NAMA-MCCH-NFL presented the CBA proposal allegedly signed by 153 union members.However, the petition signed by said members showed that the signatories endorsed the proposed terms and conditions without stating that they were likewise voting for or designating the NAMA-MCCH-NFL as their exclusive bargaining representative. In any case, NAMA-MCCH-NFL at the time of submission of said proposals was not a duly registered labor organization, hence it cannot legally represent MCCHIs rank-andfile employees for purposes of collective bargaining. Hence, even assuming that NAMA-MCCH-NFL had validly disaffiliated from its mother union, NFL, it still did not possess the legal personality to enter into CBA negotiations. A local union which is not independently registered cannot, upon disaffiliation from the federation, exercise the rights and privileges granted by law to legitimate labor organizations; thus, it cannot file a petition for certification election. [41] Besides, the NFL as the mother union has the right to investigate members of its local chapter under the federations Constitution and By-Laws, and if found guilty to expel such members.[42]MCCHI therefore cannot be faulted for deferring action on the CBA proposal submitted by NAMA-MCCH-NFL in view of the union leaderships conflict with the national federation. We have held that the issue of disaffiliation is an intra-union dispute[43] which must be resolved in a different forum in an action at the instance of either or both the federation and the local union or a rival labor organization, not the employer.[44] Not being a legitimate labor organization nor the certified exclusive bargaining representative of MCCHIs rank-and-file employees, NAMA-MCCH-NFL cannot demand from MCCHI the right to bargain collectively in their behalf. [45] Hence, MCCHIs refusal to bargain then with NAMA-MCCH-NFL cannot be considered an unfair labor practice to justify the staging of the strike.[46] Strike and picketing activities conducted by union officers and members were illegal

Art. 263 (b) of the Labor Code, as amended, provides: ART. 263. Strikes, picketing and lockouts. x x x (b) Workers shall have the right to engage in concerted activities for purposes of collective bargaining or for their mutual benefit and protection. The right of legitimate labor organizations to strike and picket and of employers to lockout, consistent with the national interest,

shall continue to be recognized and respected. However, no labor union may strike and no employer may declare a lockout on grounds involving inter-union and intra-union disputes. x x x x (Emphasis supplied.)

As borne by the records, NAMA-MCCH-NFL was not a duly registered or an independently registered union at the time it filed the notice of strike on March 13, 1996 and when it conducted the strike vote on April 2, 1996. It could not then legally represent the union members. Consequently, the mandatory notice of strike and the conduct of the strike vote report were ineffective for having been filed and conducted by NAMA-MCCH-NFL which has no legal personality as a legitimate labor organization, in violation of Art. 263 (c), (d) and (f) of the Labor Code and Rule XXII, Book V of the Omnibus Rules Implementing the Labor Code.[47] Art. 263 of the Labor Code provides: ART. 263. Strikes, picketing and lockouts. (a) x x x xxxx (c) In cases of bargaining deadlocks, the duly certified or recognized bargaining agent may file a notice of strike or the employer may file a notice of lockout with the Department at least 30 days before the intended date thereof. In cases of unfair labor practice, the period of notice shall be 15 days and in the absence of a duly certified or recognized bargaining agent, the notice of strike may be filed by any legitimate labor organization in behalf of its members. However, in case of dismissal from employment of union officers duly elected in accordance with the union constitution and by-laws, which may constitute union busting, where the existence of the union is threatened, the 15-day cooling-off period shall not apply and the union may take action immediately. (As amended by Executive Order No. 111, December 24, 1986.) (d) The notice must be in accordance with such implementing rules and regulations as the Department of Labor and Employment may promulgate. xxxx

(f) A decision to declare a strike must be approved by a majority of the total union membership in the bargaining unit concerned, obtained by secret ballot in meetings or referenda called for that purpose. A decision to declare a lockout must be approved by a majority of the board of directors of the corporation or association or of the partners in a partnership, obtained by secret ballot in a meeting called for that purpose. The decision shall be valid for the duration of the dispute based on substantially the same grounds considered when the strike or lockout vote was taken. The Department may, at its own initiative or upon the request of any affected party, supervise the conduct of the secret balloting. In every case, the union or the employer shall furnish the Ministry the voting at least seven days before the intended strike or lockout, subject to the cooling-off period herein provided. (As amended by Batas Pambansa Bilang 130, August 21, 1981 and further amended by Executive Order No. 111, December 24, 1986.) (Emphasis supplied.)

Rule XXII, Book V of the Omnibus Rules Implementing the Labor Code reads: RULE XXII CONCILIATION, STRIKES AND LOCKOUTS xxxx SEC. 6. Who may declare a strike or lockout. Any certified or duly recognized bargaining representative may declare a strike in cases of bargaining deadlocks and unfair labor practices. The employer may declare a lockout in the same cases. In the absence of a certified or duly recognized bargaining representative, any legitimate labor organization in the establishment may declare a strike but only on grounds of unfair labor practice. (Emphasis supplied.)

Furthermore, the strike was illegal due to the commission of the following prohibited activities[48]: (1) violence, coercion, intimidation and harassment against non-participating employees; and (2) blocking of free ingress to and egress from the hospital, including preventing patients and their vehicles from entering the hospital and other employees from reporting to work, the putting up of placards with a statement advising incoming patients to proceed to another hospital because MCCHI employees are on strike/protest. As shown by photographs[49] submitted by MCCHI, as well as the findings of the NCMB and Cebu City Government, the

hospital premises and sidewalk within its vicinity were full of placards, streamers and makeshift structures that obstructed its use by the public who were likewise barraged by the noise coming from strikers using megaphones.[50] On the other hand, the affidavits[51] executed by several hospital employees and patients narrated in detail the incidents of harassment, intimidation, violence and coercion, some of these witnesses have positively identified the perpetrators. The prolonged work stoppage and picketing activities of the striking employees severely disrupted hospital operations that MCCHI suffered heavy financial losses. The findings of the Executive Labor Arbiter and NLRC, as sustained by the appellate court, clearly established that the striking union members created so much noise, disturbance and obstruction that the local government authorities eventually ordered their removal for being a public nuisance. This was followed by an injunction from the NCMB enjoining the union leaders from further blocking the free ingress to and egress from the hospital, and from committing threats, coercion and intimidation against non-striking employees and patients/vehicles desiring to enter for the purpose of seeking medical treatment/confinement. By then, the illegal strike had lasted for almost five months. Consequences of illegal strike to union officers and members Art. 264 (a) of the Labor Code, as amended, provides for the consequences of an illegal strike to the participating workers: x x x Any union officer who knowingly participates in illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment status: Provided, That mere participation of a worker in a lawful strike shall not constitute sufficient ground for termination of his employment, even if a replacement had been hired by the employer during such lawful strike.

The above provision makes a distinction between workers and union officers who participate in an illegal strike: an ordinary striking worker cannot be terminated for mere participation in an illegal strike. There must be proof that he or she committed illegal acts during a strike. A union officer, on the other hand, may be terminated from work when he knowingly participates in an illegal strike, and like other workers, when he commits an illegal act during a strike.[52]

Considering their persistence in holding picketing activities despite the declaration by the NCMB that their union was not duly registered as a legitimate labor organization and the letter from NFLs legal counsel informing that their acts constitute disloyalty to the national federation, and their filing of the notice of strike and conducting a strike vote notwithstanding that their union has no legal personality to negotiate with MCCHI for collective bargaining purposes, there is no question that NAMA-MCCH-NFL officers knowingly participated in the illegal strike. The CA therefore did not err in ruling that the termination of union officers Perla Nava, Catalina Alsado, Albina Baez, Hannah Bongcaras, Ernesto Canen, Jesusa Gerona and Guillerma Remocaldo was valid and justified. With respect to the dismissed union members, although MCCHI submitted photographs taken at the picket line, it did not individually name those striking employees and specify the illegal act committed by each of them. As to the affidavits executed by non-striking employees, they identified mostly union officers as the persons who blocked the hospital entrance, harassed hospital employees and patients whose vehicles were prevented from entering the premises. Only some of these witnesses actually named a few union members who committed similar acts of harassment and coercion. Consequently, we find no error committed by the CA in CA-G.R. SP No. 66540 when it modified the decision of the NLRC and ruled that the dismissal of union members who merely participated in the illegal strike was illegal. On the other hand, in CA-G.R. SP No. 84998, the CA did not err in ruling that the dismissal of Yballe, et al. was illegal; however, it also ordered their reinstatement with full back wages. Dismissed union members not entitled to backwages but should be awarded separation pay in lieu of reinstatement

Since there is no clear proof that union members actually participated in the commission of illegal acts during the strike, they are not deemed to have lost their employment status as a consequence of a declaration of illegality of the strike. Petitioners in G.R. Nos. 154113 and 187778 assail the CA in not ordering their reinstatement with back wages. Invoking stare decisis, they cited the case of Bascon v. Court of Appeals[53] decided by this Court in 2004 and which involved two former hospital employees who likewise sued MCCHI after the latter

terminated their employment due to their participation in the same illegal strike led by NAMA-MCCH-NFL. In said case we ruled that petitioners Cole and Bascon were illegally dismissed because MCCHI failed to prove that they committed illegal acts during the strike. We thus ordered the reinstatement of petitioners Bascon and Cole without loss of seniority rights and other privileges and payment of their back wages inclusive of allowances, and other benefits computed from the time they were dismissed up to the time of their actual reinstatement. Bascon was also the basis of the award of back wages in CA-G.R. SP No. 84998. Stare decisis et non quieta movere. Stand by the decision and disturb not what is settled. Under the doctrine of stare decisis, once a court has laid down a principle of law as applicable to a certain state of facts, it will adhere to that principle and apply it to all future cases where the facts are substantially the same, [54] even though the parties may be different. It proceeds from the first principle of justice that, absent any powerful countervailing considerations, like cases ought to be decided alike. Thus, where the same questions relating to the same event have been put forward by parties similarly situated as in a previous case litigated and decided by a competent court, the rule of stare decisis is a bar to any attempt to relitigate the same issue.[55] The doctrine though is not cast in stone for upon a showing that circumstances attendant in a particular case override the great benefits derived by our judicial system from the doctrine of stare decisis, the Court is justified in setting it aside.[56] For the Court, as the highest court of the land, may be guided but is not controlled by precedent. Thus, the Court, especially with a new membership, is not obliged to follow blindly a particular decision that it determines, after reexamination, to call for a rectification.[57] Although the Bascon case involved the very same illegal strike in MCCHI which led to the termination of herein petitioners, its clearly erroneous application of the law insofar only as the award of back wages warrants setting aside the doctrine. Indeed, the doctrine of stare decisis notwithstanding, the Court has abandoned or overruled precedents whenever it realized that the Court erred in the prior decisions. Afterall, more important than anything else is that this Court should be right.[58] In G & S Transport Corporation v. Infante,[59] the Court explained the rationale for its recent rulings deleting back wages awarded to the dismissed

workers if the strike was found to be illegal. Considering that they did not render work for the employer during the strike, they are entitled only to reinstatement. With respect to backwages, the principle of a fair days wage for a fair days labor remains as the basic factor in determining the award thereof. If there is no work performed by the employee there can be no wage or pay unless, of course, the laborer was able, willing and ready to work but was illegally locked out, suspended or dismissed or otherwise illegally prevented from working. While it was found that respondents expressed their intention to report back to work, the latter exception cannot apply in this case. In Philippine Marine Officers Guild v. Compaia Maritima, as affirmed in Philippine Diamond Hotel and Resort v. Manila Diamond Hotel Employees Union, the Court stressed that for this exception to apply, it is required that the strike be legal, a situation that does not obtain in the case at bar. Under the circumstances, respondents reinstatement without backwages suffices for the appropriate relief. If reinstatement is no longer possible, given the lapse of considerable time from the occurrence of the strike, the award of separation pay of one (1) month salary for each year of service, in lieu of reinstatement, is in order. [60] (Emphasis supplied.)

The CA decision in CA-G.R. SP No. 66540 ordering the payment of separation pay in lieu of reinstatement without back wages is thus in order, to conform to the policy of a fair days wage for a fair days labor. The amount of separation pay is increased to one month pay for every year of service, consistent with jurisprudence. Accordingly, the decision in CA-G.R. SP No. 84998 is modified by deleting the award of back wages and granting separation pay in lieu of reinstatement. It is to be noted that as early as April 8, 1996, union members who took part in the concerted activities have been warned by management that NAMA-MCCHNFL is not a legitimate labor organization and its notice of strike was denied by the NCMB, and directed to desist from further participating in such illegal activities. Despite such warning, they continued with their picketing activities and held more mass actions after management sent them termination notices. The prolonged work stoppage seriously disrupted hospital operations, which could have eventually brought MCCHI into bankruptcy had the City Government of Cebu not issued a demolition order and the NLRC Region 7 not formally enjoined the prohibited

picketing activities. Also, the illegal dismissal complaints subsequently filed by the terminated employees did not obliterate the fact that they did not suffer loss of earnings by reason of the employers unjustified acts, there being no unfair labor practice committed by MCCHI. Hence, fairness and justice dictate that back wages be denied the said employees who participated in the illegal concerted activities to the great detriment of the employer. Separation pay is made an alternative relief in lieu of reinstatement in certain circumstances, like: (a) when reinstatement can no longer be effected in view of the passage of a long period of time or because of the realities of the situation; (b) reinstatement is inimical to the employers interest; (c) reinstatement is no longer feasible; (d) reinstatement does not serve the best interests of the parties involved; (e) the employer is prejudiced by the workers continued employment; (f) facts that make execution unjust or inequitable have supervened; or (g) strained relations between the employer and employee.[61] Considering that 15 years had lapsed from the onset of this labor dispute, and in view of strained relations that ensued, in addition to the reality of replacements already hired by the hospital which had apparently recovered from its huge losses, and with many of the petitioners either employed elsewhere, already old and sickly, or otherwise incapacitated, separation pay without back wages is the appropriate relief. We note that during the pendency of the cases in this Court, some of the petitioners have entered into compromise agreements with MCCHI, all of which were duly approved by this Court. Thus, excluded from the herein monetary awards are the following petitioners whose compromise agreements have been approved by this Court and judgment having been entered therein: Gloria Arguilles, Romulo Alforque, Gerna Patigdas-Barte, Daylinda Tigo Merlyn Nodado, Ramon Tagnipis, Bernabe Lumapguid, Romeo Empuerto, Marylen Labra, Milagros Castillo Bernadette Pontillas-Tibay, Constancio Pagador, Nolan Alvin Panal, Edilberto Villa, Roy Malazarte, Felecianita Malazarte and Noel Hortelano. Attorneys fees The dismissed employees having been compelled to litigate in order to seek redress and protect their rights, they are entitled to reasonable attorneys fees pursuant to Art. 2208 (2) of the Civil Code. In view of the attendant circumstances of this case, we hold that attorneys fees in the amount of P50,000.00 is reasonable and justified. However, the respondents in G.R. No. 196156 are not entitled to the same

relief since they did not appeal from the CA decision which did not include the award of attorneys fees. WHEREFORE, the petition for review on certiorari in G.R. No. 187861 is DENIED while the petitions in G.R. Nos. 154113, 187778 and 196156 are PARTLY GRANTED. The Decision dated October 17, 2008 of the Court of Appeals in CA-G.R. SP No. 66540 is hereby AFFIRMED with MODIFICATIONS in that MCCHI is ordered to pay the petitioners in G.R. Nos. 154113 and 187778, except the petitioners who are union officers, separation pay equivalent to one month pay for every year of service, and reasonable attorneys fees in the amount of P50,000.00. The Decision dated November 7, 2008 is likewise AFFIRMED with MODIFICATIONS in that MCCHI is ordered to pay the private respondents in G.R. No. 196156 separation pay equivalent to one month pay for every year of service, and that the award of back wages is DELETED. The case is hereby remanded to the Executive Labor Arbiter for the recomputation of separation pay due to each of the petitioners union members in G.R. Nos. 154113, 187778 and 196156 except those who have executed compromise agreements approved by this Court. No pronouncement as to costs. SO ORDERED. DD.

NATIONAL FEDERATION OF LABOR (NFL), AMADO MAGBANUA AND 141 OTHERS NAMELY: RODELIO PURISMA, AURORA TAN, EFREN GARCIA, RONILO PARCON, HERMICILLA MANLUCOT, JOSEPHINE ADORABLE, EVELYN BERNARDO, ELONA WATIN, GERALDINE ACUNA, LOLITA UGUIS, VILMA BAYONA, JOCELYN TORRES, MYRNA TORRALBA, GUADALUPE SUMICAD, TERESITA NAMOCA, JERRY EBIAS, GERONIMO ALICANDO, MERLENE BANAWAG, JAIME NOBLEZA, ALEXANDER BALANCAR, CESAR ABDULA, JOSEPHINE FRANCISCO, ROEL LA TORRE, NICASIO BOLINGKIT, JIMMY BORADA, JOSELITO GERMO, JOHENES FABRICA, ZALDY TUPAZ, RAMON CAWILI, DELFIN OBA-OB, REYNALDO LONGNO, ARTEMIO GUNHURAN, DANILO JISON, CAPISTRANO MANLUCOT, ALEX ROGADOR, DANILO LONGNO, ALIPIO PETIL, JOEL ORONG, MELCHOR REFUGIO, JOSE

G.R. No. 113466. December 15, 1997]

ETOQUILA, EDWIN GATPOLINTAN, MAXIMO ANADIO, ALICIA CATAYTAY, LYDIA ESPERAT, JOSEPHINE TALBA, LUCILLE ALICUNDO, GEMMA ALAWI, AIDA SANTILLAN, EVANGELINE SOMOSA, ROSARIO AQUINO, EVELYN DULAP, ROSALINA GERMO, JOCELYN BASING, JESSICA NAPOLERYES, SUSAN DAYOT, JOVITA ALBON, SATURNINA GUEVARRA, JUVY BRITO, RUTH BUNTIS, ELENITA PACHES, BAING GARCIA, JOSEFA ROGADOR, JUDITH GABUYAN, AGNES PAJA, MARIEL DANAG, DELY BUCOY, EVANGELINE MONTUNO, DOLORES BOVLEZA, NORMA DA LEON, GLORIA ATILANO, PRECIOSA BAYTONG, EVELYN TANJUSAY, ARLENE HANDI, JENNIFER VILLANUEVA, LIGAYA DUARONG, FLORA SEBAYLOS, SALVACION CARPIO, EMILIANA SANTIAGO, DOLORES OBLINA, MADELYN JALAO, SOCORRO EDUARTE, CRESENCIA ALFORQUE, SUSANA TARROZA, EDWINA CABAS, NENITA TIMPANGCO, VICTORIA GAPASIN, CARINA ENRIQUEZ, EVELYN FERNANDEZ, MERCY CATAYLO, GREGORIA OSIN, FLORITA PADUA, TITA FRANCISCO, VICTORIA POGOSA, RITA SANCHEZ, LEILANIE DUMAGCO, TERESITA NOBLEZA, MA. DOLORES RAVAL, ABDULA BEDIO, ANNABELLE PAULINO, ANNALIZA LIM, JUANITA ALICANDO, RAYAMAY PANAS, RACHEL GABUYAN, ELIZABETH REGIDOR, ARLENE SUAN, LETICIA ENRIQUEZ, ELENA ETOQUILLA, GERTUDES TUG, EDDIE TANJUSAY, MELQUIADES PINDULAS, REYNERIO ROJAS, SUSAN SALGAN, MA. ISABEL ALMONTE, LUZ DUNGOG, FLORINDA VALENTE, VIVENCIO ATUY, MAXIMA ALFANTTA, WILLY RECTO, REYNALDO BANTILLAN, ERNESTO SEDENO, EDWINA CAWILI, ARACELI RAVAL, MARCELINA BULAC, MA. ELENA GERMAN, PILAR GENA, NESTOR ALAWI, HERCULANOLAS PINAS, GIDEON BRITO, JIMMY NOBLEZA, LORETO GERMAN, AMINA DASAN, ROSEBETH LIBRERO, ADELINA CABILIN, ELIZABETH MATAS, MYRNA PELISAN, MILAGROS DEL MUNDO, ANTONIETA BELARMINO, CLARIBEL CUSTODIO, VILMA JUMAWAN, JORELYN CAMUMOT, AND MA. CLARA SALVADOR, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION FIFTH DIVISION (NLRC), PERMEX PRODUCER AND EXPORTER CORPORATION, TAN TAY CUAN, JENNIFER PUNZALAN, EDGAR LIM, DOMINIC TAN and GEORGE SYCHUAN, respondents.

DECISION ROMERO, J.:

This is a petition for certiorari from the decision of the National Labor Relations Commission dated August 6, 1993 affirming the consolidated decision jointly rendered by Labor Arbiters Reynaldo Villena and Allen Abubakar in RAB Case No. 09-02-00062-93 and 09-02-00069-93 involving illegal strike and unfair labor practice, the dispositive portion of which reads: WHEREFORE, based on the foregoing we hereby declare: 1. That the strike staged and conducted by respondents in NLRC RAB Case No. 0902-00062-93 on January 25 and 26, 1993 and on February 11 to March 29, 1993 as illegal; 2. The complaint filed by complainants in NLRC Case No. RAB 09-02-00069-93 against PERMEX, including its officers for unfair labor practice with claims for damages and backwages, dismissed for lack of merit; and 3. Respondents in NLRC Case No. RAB 09-02-00062-93 liable jointly and severally to petitioner for moral and exemplary damages in the amount of P500,000.00 and P300,000.00 respectively, as prayed for in its Amended Complaint; 4. The dismissal of all respondents in NLRC Case No. 09-02-00062-93 as valid; 5. All other claims are hereby dismissed for lack of merit.

SO ORDERED. The facts, as culled from the record, are as follows: Respondent PERMEX Producer and Exporter Corporation (hereinafter referred to as PERMEX for brevity) is a Zamboanga City-based corporation engaged in the business of fish and tuna export while its co-respondents are its corporate officers. Petitioners, on the other hand, are the National Federation of Labor (hereinafter referred to as NFL for brevity), a legitimate labor federation represented by its Regional Director for Western Mindanao Amado Magbanua, and 141 members of said union, who are dismissed employees of respondent corporation. On January 23, 1993, NFL contends that 10 union officials who had attended a schedule certificate election conference the previous day were barred from entering the company premises and were prohibited to work therein, allegedly due to their union activities. The NLRC, however, upheld the contention of PERMEX that three of said workers asked to be excused from work while the rest were given time off in order to attend to union activities and were told to return on January 30, 1993. It thus found that the companys

actuations did not consist in a lockout but were related to disciplinary matters not in any way connected with a labor dispute. Furthermore, the record shows that the ten (10) workers concerned did not report for work in the morning of January 22, 1993, although the pre-election conference was yet to be held at 1:30 in the afternoon of the same day. Yet another group of workers which attended the conference reported for work the next day. In the words of the NLRC: if the group of ten were subjected to some disciplinary action by management, the same was justified not because of their union affiliations but for breach of company discipline. In other words, the group of ten were (sic) using their union activities to go on undertime or to justify their constant and frequent absences which evidently was a violation of company policy. [1]

Be that as it may, on January 25, 1993 said workers attempted to re-enter the company premises but were prevented from doing so, prompting several of their co-workers to seek an audience with the President and General Manager who was then within premises. Their efforts having been allegedly rebuffed, over 200 workers staged a picket outside company premises. The gates were barricaded, thus blocking ingress and egress of company vehicles, trapping 50 workers inside and paralyzing company operations. Additionally, 700 non-striking workers were prevented from working on January 26, 1997. The workers only returned to work on January 27, 1993 when a memorandum of agreement was forged the same day between representatives of PERMEX and NFL. Pursuant to the agreement, PERMEX issued a memorandum requiring the workers concerned to fully explain their participation in the above-mentioned strike. However, most workers refused to submit explanations, prompting the management to place them under preventive suspension effective February 13, 1993. Only about 40 workers who proffered satisfactory explanations were allowed to return to work. On January 29, 1993, NFL filed a Notice of Strike with the National Conciliation and Mediation Board-Region IX of Zamboanga City. Said notice was contested by PERMEX on February 5, 1993 during the conciliation meeting, prompting NFL to file a new Notice of Strike the same day. Said Notice alleged discrimination, coercion, union busting, blacklisting of union members, intimidation and dismissal of union officers and members. In the interim, on February 3, 1993 PERMEX filed Case No. RAB 09-0200062-93 against Amado Magbanua et al. to declare the strike held on January 25 and 26 as illegal. This was assigned to Labor Arbiter Reynaldo S. Villena. Likewise, on February 8, 1993, NFL filed Case No. RAB 09-02-00069-

93 against PERMEX for unfair labor practice and damages, the same being assigned to Labor Arbiter Allen Abubakar. Another conciliation meeting was held on February 10, 1993 in connection with the February 5, 1993 Notice of Strike. However, on February 11, 1993 the workers affiliated with NFL barricaded the company gates, tying the same with ropes and chains and preventing non-striking workers from entering or leaving the premises. Thus, from February 12 to march 2, 1993, the company was constrained to ferry its workers to and from the company premises through its wharf with the use of motorboats. On March 3, 1993, the striking workers cut the company fence leading to the wharf, gained control of the same, and chained close the last point of entrance and exit to and from the premises. The records also show that acts of coercion, intimidation and harassment were committed by the striking workers, including the uttering of threats of bodily harm against non-striking workers and company officials. On March 11, 1993 the secretary of Labor assumed jurisdiction over the dispute pursuant to a petition of NFL filed on January 29, 1993. He likewise issued a Return-to-Work Order to take effect within 24 hours from receipt thereof. PERMEX publicly announced through print and radio that all striking workers should return by March 15, 1993. However, the intercession of PNP agents notwithstanding, the same was ignored. It was only on March 29, 1993 that the workers finally lifted their picket lines. Thereafter, Labor Arbiters Villena and Abubakar issued the consolidated decision now being assailed. NFL then appealed to the NLRC. However, the NLRCs 5 Division, on August 6, 1993, affirmed the decision of the Labor Arbiter but awarded only P300,000.00 as compensatory damages to PERMEX. NFLs motion for reconsideration was denied, hence this petition for certiorari with this Court. th

Petitioner contends that the NLRC committed grave abuse of discretion when the latter disregarded the affidavits and other evidence submitted by it, as well as by its failure to conduct actual open hearings to prove petitioners claims. Furthermore, petitioner contends that the NLRC gravely abused its discretion when it upheld the dismissal of 141 employees on the basis of a resolution of the City Fiscals Office finding a prima facie case against said employees for illegal acts committed during the strikes in question. Lastly, petitioner contends that company internal reports of spoiled products, which are unverified and unaudited are not competent evidence to prove damages caused by the concerted action of the workers. We rule for the respondent.

The first issue raised by petitioner relates to the veracity of the factual findings of the NLRC and the Labor Arbiter. At the outset, it should be noted that a petition for certiorari under Rule 65 of the Rules of Court will prosper only if there is a showing of grave abuse of discretion or an act without or in excess of jurisdiction on the part of the National Labor Relations Commission. It does not include an inquiry as to the correctness of the evaluation of evidence which was the basis of the labor official or officer in determining his conclusion. It is not for this Court to re-examine conflicting evidence, re-evaluate the credibility of witnesses nor substitute the findings of fact of an administrative tribunal which has gained expertise in its special field.Considering that the findings of fact of the Labor Arbiter and the NLRC are supported by evidence on record, the same must be accorded due respect and finality. [2]

Then too petitioner, with great vigor, argues that a full-blown trial should have been conducted by the NLRC in order to uncover the truth of the parties respective assertions, the absence of which is alleged to constitute a denial of due process. Petitioner should bear in mind that a formal or trial-type hearing is not at all times and in all instances essential to due process, the requirements of which are satisfied where parties are afforded fair and reasonable opportunity to explain their side of the controversy at hand. In instant case, its arguments are unavailing where the records show that they were given ample opportunity to present, as they did so present, affidavits and position papers where they set out their factual and legal arguments. [3]

Furthermore, the holding of a trial is discretionary on the labor arbiter and cannot be demanded as a matter of right by the parties. As further elucidated in Palomado v. NLRC, et. al. we do not see how the failure of the arbiter to conduct a formal hearing could constitute grave abuse of discretion. Sec. 3, Rule VII grants an arbiter wide latitude to determine whether there is a need for a formal hearing or investigation x x x after the submission by the parties of their position papers and supporting proofs (P)etitioner believes that had there been a formal hearing, the arbiters alleged mistaken reliance on some of the documentary evidence submitted by parties would have been cured and remedied by them, presumably through the presentation of controverting evidence. Evidently, this postulate is not in consonace with the need for speedy disposition of labor cases, for the parties may then willfully withold their evidence and disclose the same only during the formal hearing, thus creating surprises which could merely complicate the issues and prolong the trial. There is a dire need to lessen technicalities in the process of settling labor disputes. [4]

[5]

In addition, and as stated earlier, it is a general rule that findings of administrative agencies are accorded not only respect but even finality. It is well established that findings of facts of the National Labor Relations Commission are binding on the Supreme Court, if supported by substantial evidence. In the instant case, the findings of the NLRC that the strike held by NFL and its members on January 25-26 and again on February 11-March 29 were illegal are supported by the evidence on record. A strike (or lockout), to enjoy the protection of law, must observe certain procedural requisites mentioned in Art. 263 and the Implementing Rules, namely: 1) A notice of strike, with the required contents, should be filed with the DOLE, specifically the Regional Branch of the NCMB, copy furnished the employer of the union; 2) A cooling-off period must be observed between the filing of notice and the actual execution of the strike thirty (30) days in case of bargaining deadlock and fifteen (15) days in case of unfair labor practice. However, in the case of union busting where the unions existence is threatened, the cooling-off period need not be observed. xxx xxx xxx 4) Before a strike is actually commenced, a strike vote should be taken by secret balloting, with a 24-hour prior notice to NCMB. The decision to declare a strike requires the secret-ballot approval of majority of the total union membership in the bargaining unit concerned. 5) The result of the strike vote should be reported to the NCMB at least seven (7) days before the intended strike or lockout, subject to the cooling-off period. [6]

The provisions hardly leave any room for doubt that the cooling-off period in Art. 264(c) and seven-day strike ban after the strike-vote report prescribed in Art. 264(f) were meant to be, and should be deemed, mandatory [Art. 264 should now read Art. 263]. [7]

In the case at bar, no notice of strike, as required by Art. 263 (c) was filed by NFL prior to the strike on January 25 and 26. No prior notice of the taking of a strike vote was furnished the NCMB, nor was the seven-day strike ban after the strike vote observed. Instead, the workers immediately barricaded

company premises in the afternoon of January 25, 1996, completely disregarding the procedural steps prescribed by Art. 263 (c) and (f). As for the strike commenced on February 11, only six days had elapsed from the filing of the Notice to Strike on February 5, 1993. In addition, various illegal acts were committed by the strikers during said strike. It can be gleaned from the record that the strikers destroyed company property and intimidated and harassed non-striking workers in violation of Art. 264 (e) of the Labor Code. Likewise, barricading, chaining and padlocking of gates to prevent free ingress and egress into company premises are also violations of the selfsame article. [8]

Arguing that despite its failure to comply with the statutory requirements necessary for a valid strike, NFL asserts that the same can be declared legal for it was done in good faith, citing the cases of Peoples Industrial and Commercial Employees and Workers Organization (FFW) v. Peoples Industrial and Commercial Corp. and Philippine Metal Foundaries, Inc. v. Court of Industrial Relations. The reliance is misplaced. Peoples Industrial did not rule that the procedural steps can be dispensed with even if the union believed in good faith that the company was committing an unfair labor practice. While, it is true that Philippine Metal held that a strike cannot be declared as illegal for lack of notice, however, it is important to note that said case was decided in 1979. At this juncture, it must be stressed that with the enactment of Republic Act No. 6715 which took effect on March 21, 1989, the rule now is that such requirements as filing of a notice of strike, strike vote, and notice given to the Department of Labor are mandatory in nature. [9]

[10]

[11]

[12]

Thus, even if the union acted in good faith in the belief that the company was committing an unfair labor practice, if no notice of strike and a strike vote were conducted, the said strike is illegal. [13]

Second, it is alleged that the dismissal of the 141 workers is based solely on a prima facie finding that they committed various unlawful acts while staging their strike, as certified by the City Prosecutors Office. This allegation is not true. The dismissal is principally based on their refusal to return to work after the Secretary of Labor had assumed jurisdiction over the case on March 11, 1993. In fact, despite the efforts of PNP personnel through the District Commander to persuade the workers to comply with the Return-to-Work Order, the strike continued until March 29, 1993 when the workers dismantled their pickets. As held in St. Scholasticas College v. Hon Ruben Torres and Samahan ng Manggagawang Pang-edukasyon sa Sta. Escolastika (a) strike undertaken despite the issuance by the Secreatry of Labor of an assumption [14]

or certification order becomes a prohibited activity and thus illegal, pursuant to the second paragraph of art. 264 of the Labor Code, as amended x x x The union officers and members, as a result, are deemed to have lost their employment status for having knowingly participated in an illegal act. Case law, likewise, provides that by staging a strike after the assumption or certification for arbitration, the workers forfeited their right to be readmitted to work, having abandoned their employment. [15]

NFL claims that its refusal to follow the return to work order issued by the Secretary of labor was justified, since Permex was imposing certain conditions before admitting them back to work, citing the contents of a prepared form executed by Permex. [16]

[17]

This claim lacks merit. Contrary to NFLs contention, it is quite obvious that the form was dated January 27, 1993, which was prior to the return-to-work order issued by the Secretary of Labor on March 11, 1993; thus, NFLs refusal has no factual basis. To salvage its position, NFL asserts that Permex issued the same memorandum even after the Secreatry of labor had issued the return-to-work order, but in its lengthy (eighty-eight pages) petition, no copy of the said memorandum was attached when it could have easily done so. Hence, NFLs reason in refusing to comply with the return-to-work order is nothing but a bare assertion, unsupported by any evidence on record. [18]

Finally, as to the amount of damages awarded, respondent company submitted mere certifications by company officials that P300,000.00 worth of cooked fish were spoiled during the January 25-26 strike and that the respondent company lost about $3,431,630.00 in US commitments due to the paralyzation of company operations brought about by the February 11-March 29 strike. The same were found by the Labor Arbiter to be self-serving and no probative value; hence it only awarded moral and exemplary damages. The NLRC, on the other hand, deleted the award of moral and exemplary damages but awarded compensatory damages of P300,000.00, justifying the same in this wise: The compensatory damages assessed upon NFL is more than justified. PERMEX has sustained huge damages and losses as a consequence of the illegal strike staged by NFL and its affiliate workers under the able direction of the union leadership. While it may be true that the NFL under Amado Magbanua and National President Ibbarra Malonzo has appeared to have tried to diffuse and resolve the dispute, its intercession obviously came after so much has been done upon the company. [19]

It is only too clear that the damages awarded are not based on concrete proof. This Court has ruled that (i)n order that damages may be recovered,

the best evidence obtainable by the injured party must be presented. Actual or compensatory damages cannot be presumed, but must be duly proved, and so proved with reasonable degree of certainty. A court cannot rely on speculation, conjecture or guesswork as to the fact and amount of damages, but must depend upon competent proof that they have been suffered and on evidence of the actual amount thereof. If the proof is flimsy and insubstantial, no damages will be awarded. [20]

However, the strike dragged on for nearly 50 days, paralyzing respondents operations; thus, there is no room for doubt that some species of injury was caused to private respondent. In the absence of competent proof on the actual damages suffered, private respondent is entitled to nominal damages which, as the law says, is adjudicated in order that a right of the plaintiff, which has been violated or invaded by the defendant, may be vindicated and recognized, and not for the purpose of indemnifying the plaintiff for any loss suffered." We consider the amount of P300,00.00 just and reasonable under the circumstances. [21]

In view of the foregoing, we do not find any grave abuse of discretion on the part of the NLRC in rendering the assailed decision. WHEREFORE, the petition is DISMISSED for lack of merit. SO ORDERED.