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G.R. No. 106231 November 16, 1994
HAWAIIAN-PHILIPPINE COMPANY, petitioner,
vs.
REYNALDO J. GULMATICO, Labor Arbiter, Regional Arbitration Branch No. VI, AND NATIONAL FEDERATION
OF SUGAR WORKERS-FOOD AND GENERAL TRADES representing all the sugar farm workers of the
HAWAIIAN PHILIPPINE MILLING DISTRICT, respondents.
Angara,Abella,Concepcion,Regala & Cruz for petitioner.
Manlapao,Ymballa and Chaves for private respondent.
BIDIN, J.:
2. This petition for certiorari and prohibition with preliminaryinjunction seeks to annul the Order dated June 29, 1992
issued bypublic respondentLabor Arbiter Reynaldo J. Gulmatico denying petitioner's motion for "Claims on R.A. 809"
in RAB VI Case No. 06-07-10256-89,the dispositive portion of which reads,in part:
WHEREFORE, premises considered,the motion to dismiss dated July31, 1989 and the
supplementthereto dated September 19,1989 filed by respondentcompanytogether with the
motion to dismiss filed byrespondentRamon Jison dated August27,1990 and Francisco Jison
dated September 20,1990, respectively, are hereby DENIED.
xxx xxx xxx
(Rollo,p. 59)
The antecedentfacts are as follows:
On July 4, 1989, respondentunion,the National Federation ofSugar Workers -Food and General Trades (NFSW-
FGT) filed RAB VI Case No. 06-07-10256-89 againstherein petitioner Hawaiian-Philippine Companyfor claims under
Republic Act 809 (The Sugar Act of 1952).Respondentunion claimed thatthe sugar farm workers within petitioner's
milling districthave never availed of the benefits due them under the law.
Under Section 9 of R.A 809, otherwise known as the Sugar Act of 1952,it is provided,to wit:
Sec. 9. In addition to the benefits granted by the Minimum Wage Law, the proceeds ofany increase
in participation granted to planters under this Act and above their presentshare shall be divided
between the planter and his laborers in the following proportions;
Sixty per centum of the increase participation for the laborers and forty per centum for the planters.
The distribution ofthe share corresponding to the laborers shall be made under the supervision of
the DepartmentofLabor.
xxx xxx xxx
(Emphasis supplied.)
On July 31, 1989,petitioner filed a "Motion to Dismiss,"followed bya "Supplemental Motion to Dismiss"on
September 19,1989.Petitioner contended thatpublic respondentLabor Arbiter has no jurisdiction to entertain and
resolve the case,and that respondentunion has no cause ofaction againstpetitioner.
On August 23, 1989,respondentunion filed an "Opposition to Motion to Dismiss."
On October 3,1989, petitioner applied a "Reply to Opposition"followed by a "Citation of Authorities in Supportof
Motion to Dismiss."
On December 20,1989,respondentunion filed an amended complaintadditionallyimpleading as complainants Efren
Elaco, Bienvenido Gulmatico,Alberto Amacio,Narciso Vasquez, Mario Casociano and all the other farm workers of
the sugar planters milling with petitioner from 1979 up to the present,and as respondents,Jose Maria Regalado,
Ramon Jison,RollyHernaez, Rodolfo Gamboa,Francisco Jison and all other sugar planters milling their canes with
petitioner from 1979 up to the present.
On August 27, 1990,Ramon Jison,one of the respondents impleaded in the amended complaint,filed a "Motion to
Dismiss and/or to Include NecessaryParties,"praying for the inclusion as co-respondents ofthe Asociacion de
Hacenderos de Silan-Saravia,Inc. and the Associate Planters ofSilay-Saravia, Inc.
On June 29, 1992,public respondentpromulgated the assailed Order denying petitioner's Motion to Dismiss and
Supplemental Motion to Dismiss.
3. Hence,this petition filed by Hawaiian-Philippine Company.
Petitioner reasserts the two lesson earlier raised in its Motion to Dismiss which public respondentunfavorably
resolved in the assailed Order.
These two issues are first,whether public respondentLabor Arbiter has jurisdiction to hear and decide the case
againstpetitioner;and the second,whether respondentunion and/or the farm workers represented byit have a cause
of action againstpetitioner.
Petitioner contends thatthe complaintfiled againstitcannotbe categorized under any of the cases falling within the
jurisdiction ofthe Labor Arbiter as enumerated in Article 217 of the Labor Code,as amended,considering thatno
employer-employee relationship exists between petitioner milling companyand the farm workers represented by
respondentunion.Article 217 of the Labor Code provides:
Art. 217. Jurisdiction ofLabor 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 ofthe case by the parties for decision
withoutextension,even in the absence ofstenographic notes,the following cases involving all
workers,whether agricultural or non-agricultural:
1. Unfair labor practice cases;
2. Termination disputes;
3. If accompanied with a claim for reinstatement,those cases thatworkers mayfile involving
wages,rates of pay, hours ofwork and other terms and conditions ofemployment;
4. Claims for actual,moral,exemplary and other forms of damages arising from employer-
employee relations;
5. Cases arising from anyviolation of Article 264 of this Code,including questions involving the
legality of strikes and lockouts;and
6. Except claims for employees'compensation,social security,medicare from maternity
benefits, all other claims arising from employer-employee relations,including those ofpersons in
domestic or household service,involving an amountexceeding Five Thousand Pesos (P5,000.00),
whether or not accompanied with a claim for reinstatement.(Em phasis supplies)
In supportof the contention that the Labor Arbiter has no jurisdiction to hear and decide the case againstpetitioner,
the latter cites the ruling in San Miguel Corporation vs. NLRC,161 SCRA 719 [1988], wherein it was held that a
single unifying elementruns through the cases and disputes falling under the jurisdiction ofthe Labor Arbiter and that
is that all the enumerated cases and disputes arise outofor are in connection with an employer-employee
relationship,or some aspector incidentof such relationship.Likewise,in Federation of Free Farmers vs. Courtof
Appeals,107 SCRA 411 [1981], this Courtheld that:
. . . . From the beginning ofthe sugar industry,the centrals have never had any privity with the
plantation laborers,since theyhad their own laborers to take care of. . . . Nowhere in Republic Act
809 (the Sugar Act of 1952) can we find anything that creates any relationship between the
laborers ofthe planters and the centrals.. . .
. . . Under no principle oflaw or equity can we impose on the central . . . any liability to the
plantation laborers... . (Emphasis supplied)
On the strength of the aforecited authorities,petitioner contends thatit is not a proper party and has no involvement
in the case filed by respondentunion as itis notthe employer of the respondentsugar workers.
4. Furthermore,to bolster its contention,petitioner cites the Rules and Regulations Implementing RA809 issued bythe
then Wage Administration Service pursuantto the Administrative Order of the Labor Secretary dated October 1,
1952.Section 1 thereofstates:
Sec. 1. The paymentof the proceeds derived from the sixty per centum of any increase in the
participation due the laborers shall be directly paid to the individual laborer concerned atthe end of
each milling season by his respective planter under the Supervision ofthe Secretary of Labor or his
duly authorized representative by means ofpayrolls prepared by said planter.(Emphasis supplied)
In addition,under Letter of Instruction No.854 dated May 1, 1979, it is provided:
1. Payment subjectto supervision.The workers'share shall be paid directlyby the planter
concerned to the workers or claimants entitled thereto subjectto the supervision ofthe Minister of
Labor or his duly designated representative.
The responsibilityfor the payment of the sugar workers'benefits under R.A. 809 was categoricallyruled upon in
the Federation of Free Farmers case,supra., to wit:
. . . the matter of paying the plantation laborers ofthe respective planters becomes exclusively the
concern of the planters, the laborers and the DepartmentofLabor.Under no principle of law or
equity can we impose on the Central — here VICTORIAS any liability to the respective plantation
laborers,should any of their respective planters-employers fail to pay their legal share. After all,
since under the law it is the Departmentof Labor which is the office directly called upon to
supervise such payment,itis but reasonable to maintain thatif any blame is to be fixed for the
unfortunate situation ofthe unpaid laborers,the same should principallybe laid on the planters and
secondarilyon the DepartmentofLabor, but surelynever on the central.
Whatever liability there exists between favor of the plantation laborers should be pinned on the
PLANTERS, their respective employers.(Emphasis supplied)
On the other hand,public respondentand respondentunion maintain the position thatprivity exists between
petitioner and the sugar workers.Actually, public respondent,in resolving petitioner's Motion to Dismiss,skirted the
issue ofwhether an employer-employee relationship indeed exists between petitioner milling companyand the sugar
workers.He did not categoricallyrule thereon but instead relied on the observation thatwhen petitioner delivered to
its planters the quedans representing its share,petitioner did notfirst ascertain whether the shares ofall workers or
claimants were fullypaid/covered pursuantto LOI No. 854, and that petitioner did not have the necessarycertification
from the Departmentof Labor attesting to such fact of delivery. In view of these observations,public respondent
subscribed to the possibilitythat petitioner maystill have a liability vis-a-vis the workers'share.Consequently, in order
that the workers would nothave to litigate their claim separately,which would be tantamountto tolerating the splitting
of a cause of action, public respondentheld thatpetitioner should still be included in this case as an indispensable
party withoutwhich a full determination ofthis case would notbe obtained.
We find for petitioner.
The Solicitor General,in its adverse Comment,correctly agreed with petitioner's contention thatwhile the jurisdiction
over controversies involving agricultural workers has been transferred from the Courtof Agrarian Relations to the
Labor Arbiters under the Labor Code as amended,the said transferred jurisdiction is however,not withoutlimitations.
The dispute or controversy muststill fall under one of the cases enumerated under Article 217 of the Labor Code,
which cases,as ruled in San Miguel, supra., arise outof or are in connection with an employer-employee relationship.
In the case at bar, it is clear that there is no employer-employee relationship between petitioner milling companyand
respondentunion and/or its members-workers,a fact which, the Solicitor General notes,public respondentdid not
dispute or was silentabout.Absent the jurisdictional requisite ofan employer-employee relationship between
petitioner and private respondent,the inevitable conclusion is thatpublic respondentis withoutjurisdiction to hear and
decide the case with respectto petitioner.
Anent the issue ofwhether respondentunion and/or its members-workers have a cause of action againstpetitioner,
the same mustbe resolved in the negative. To have a cause of action,the claimantmustshow thathe has a legal
5. right and the respondenta correlative duty in respectthereof, which the latter violated by some wrongful act or
omission (Marquezvs. Varela, 92 Phil. 373 [1952]). In the instantcase,a simple reading ofSection 9 of R.A. 809 and
Section 1 of LOI 845 as aforequoted,would show thatthe paymentof the workers'share is a liabilityof the planters -
employers,and notof the milling company/sugar central.We thus reiterate Our ruling on this matter, as enunciated
in Federation of Free Farmers,supra., to wit:
. . . . Nowhere in Republic Act No. 809 can we find anything that creates any relationship between
the laborers ofthe planters and the centrals.Under the terms of said Act, the old practice of the
centrals issuing the quedans to the respective PLANTERS for their share ofthe proceeds of milled
sugar per their milling contracts has notbeen altered or modified. In other words, the language of
the Act does not in any manner make the central the insurer on behalfof the plantation laborers
that the latter's respective employers-planters would pay them their share. . . .
. . . . Accordingly, the only obligation ofthe centrals (under Section 9 of the Act), like VICTORIAS,
is to give to the respective planters,like PLANTERS herein,the planters'share in the proportion
stipulated in the milling contractwhich would necessarilyinclude the portion of 60% pertaining to
the laborers.Once this has been done,the central is alreadyout of the picture.. . . (Emphasis
supplied)
In the case at bar, it is disputed thatpetitioner milling companyhas alreadydistributed to its planters their respective
shares.Consequently,petitioner has fulfilled its partand has nothing more to do with the subsequentdistribution by
the planters ofthe workers'share.
Public respondent's contention thatpetitioner is an indispensable partyis not supported by the applicable provisions
of the Rules of Court. Under Section 7, Rule 3 thereof, indispensable parties are "parties in interest"withoutwhom no
final determination ofthe action can be obtained.In this case,petitioner cannotbe deemed as a party in interest
since there is no privity or legal obligation linking itto respondentunion and/or its members-workers.
In order to further justify petitioner's compulsoryjoinder as a party to this case,public respondentrelies on petitioners'
lack of certification from the Departmentof Labor of its delivery of the planters'shares as evidence ofan alleged
"conspicuous displayofconcerted conspiracybetween the respondentsugar central (petitioner) and its adherent
planters to deprive the workers or claimants oftheir shares in the increase in participation ofthe adherentplanters."
(Rollo,p. 56)
The assertion is based on factual conclusions which have yet to be proved. And even assuming for the sake of
argumentthatpublic respondent's conclusions are true,respondentunion's and/or its workers'recourse lies with the
Secretary of Labor,upon whom authority is vested under RA 809 to supervise the paymentof the workers'shares.
Any act or omission involving the legal right of the workers to said shares maybe acted upon by the Labor Secreta ry
either motu proprio or at the instance of the workers.In this case however, no such action has been broughtby the
subjectworkers,therebyraising the presumption thatno actionable violation has been committed.
Public respondentis concerned thatthe respondentplanters mayeasilyput up the defense that the workers'share is
with petitioner milling company,giving rise to multiplicityof suits.The Solicitor General correctly postulates thatthe
planters cannotlegallysetup the said defense since the paymentofthe workers'share is a direct obligation ofthe
planters to their workers that cannotbe shifted to the miller/central.Furthermore,the Solicitor General notes that
there is nothing in RA 809 which suggests directlyor indirectly that the obligation ofthe planter to pay the workers'
share is dependentupon his receiptfrom the miller ofhis own share.If indeed the planter did not receive his justand
due share from the miller,he is not without legal remedies to enforce his rights.The proper recourse againsta
reneging miller or central is for the planter to implead the former not as an indispensable partybut as a third party
defendantunder Section 12, Rule 6 of the Rules ofCourt. In such case,herein petitioner milling companywould be a
proper third party dependentbecause itis directlyliable to the planters (the original defendants) for all or part of the
workers'claim.However,the planters involved in this controversy have not filed any complaintofsuch a nature
againstpetitioner,therebylending credence to the conclusion thatpetitioner has fulfilled its part vis-a-vis its obligation
under RA 809.
WHEREFORE, premises considered,the petition is GRANTED. Public respondentReynaldo J. Gulmatico is hereby
ORDERED to DISMISS RAB VI Case No. 06-07-10256-89 with respectto herein petitioner Hawaiian-Philippine
Companyand to PROCEED WITH DISPATCH in resolving the said case.
6. SO ORDERED.
[G.R. No. 117650. March 7, 1996]
SULPICIO LINES, INC., petitioner, vs. NATIONAL LABOR RELATIONS
COMMISSION and JAIME CAGATAN, respondents.
D E C I S I O N
KAPUNAN, J.:
Petitioner Sulpicio Lines, Inc., owner of MV Cotabato Princess, on
January 15, 1992 dismissed private respondent Jaime Cagatan,
a messman of the said vessel, allegedly for being absent without leave for a
“prolonged” period of six (6) months.
As a result of his dismissal, the private respondent filed a complaint for
illegal dismissal before the National Labor Relations Commission (NLRC)
through its National Capital Region Arbitration Branch in Manila, docketed as
NLRC-NCR Case No. 00-06-3163-92.[1]
Responding to the said complaint, petitioner, on June 25, 1992, filed a
Motion to Dismiss on the ground of improper venue, stating, among other
things, that the case for illegal dismissal should have been lodged with
the NLRC’s Regional Branch No. VII (Cebu), as its main office was located
in Cebu City.[2]
In an Order dated August 21, 1992 Labor Arbiter Arthur L. Amansec of the
NLRC-NCR denied petitioner’s Motion to Dismiss, holding that:
Considering that the complainant is a ship steward, traveled on board respondent’s
ship along the Manila-Enstancia-Iloilo-Zamboanga-Cotabato vice-versa route, Manila
can be said to be part of the complainant’s territorial workplace.[3]
The aforequoted Order was seasonably appealed to the NLRC by
petitioner. On February 28, 1994, respondent NLRC found petitioner’s appeal
unmeritorious and sustained the Labor Arbiter’s August 21, 1992 ruling,
explaining that “under the New NLRC Rules, the Commission or the Labor
Arbiter before whom the case is pending may order a change of
venue.”[4]
Finding no grave abuse of discretion in the Labor Arbiter’s assailed
Order, respondent NLRC emphasized that:
7. [T]he complainant instituted the Action in Manila where he resides. Hence, we see no
grave abuse of discretion on the part of the labor arbiter in denying the respondent’s
Motion to Dismiss as We find support in the basic principle that the State shall afford
protection to labor and that the NLRC is not bound by strict technical rules of
procedure.[5]
Undaunted, petitioner sought a reconsideration of the above Order, which
the public respondent denied in its Resolution dated July 22,
1994.[6]
Consequently, petitioner comes to this Court for relief, in the form of a
Special Civil Action for Certiorari under Rule 65 of the Rules of Court,
contending that public respondent NLRC acted with grave abuse of discretion
amounting to lack or excess of jurisdiction when it issued its assailed rulings.[7]
It is petitioner’s principal contention that a ship or vessel as workplace is
an extension of its homeport or principal place of business, and that “being
part of the territory of the homeport, (such) vessel is governed to a large
extent by the laws and is under the jurisdiction of the homeport.[8]
Based on
this submission, petitioner avers that its vessel-as-workplace is “under the
territorial jurisdiction of the Regional Arbitration branch where (its) . . .
principal office is located,” which is Branch VII, located in Cebu City.[9]
We disagree.
As early as 1911, this Court held that the question of venue essentially
relates to the trial and touches more upon the convenience of the parties,
rather than upon the substance and merits of the case.[10]
Our permissive rules
underlying provisions on venue are intended to assure convenience for the
plaintiff and his witnesses and to promote the ends of justice. This axiom all
the more finds applicability in cases involving labor and management because
of the principle, paramount in our jurisdiction, that the State shall afford full
protection to labor.[11]
Even in cases where venue has been stipulated by the parties by contract,
this Court has not hesitated to set aside agreements on venue if the same
would lead to a situation so grossly inconvenient to one party as to virtually
negate his claim. In Sweet Lines vs. Teves,[12]
involving a contract of adhesion,
we held that:
An agreement will not be held valid where it practically negates the action of the
claimants, such as the private respondents herein. The philosophy underlying the
provisions on transfer of venue of actions is the convenience of the plaintiffs as well
as his witnesses and to promote the ends of justice. Considering the expense and
trouble a passenger residing outside Cebu City would incur to prosecute a claim in the
City of Cebu, he would most probably decide not to file the action at all. The
8. condition will thus defeat, instead of enhance, the ends of justice. Upon the other
hand, petitioner had branches or offices in the respective ports of call of the vessels
and can afford to litigate in any of these places. Hence, the filing of the suit in the
CFI of Misamis Oriental, as was done in the instant case will not cause inconvenience
to, much less prejudice petitioner.[13]
In the case at bench, it is not denied that while petitioner maintains its
principal office in Cebu City, it retains a major booking and shipping office in
Manila from which it earns considerable revenue, and from which it hires and
trains a significant number of its workforce. Its virulent insistence on holding
the proceedings in the NLRC’s regional arbitration branch in Cebu City is
obviously a ploy to inconvenience the private respondent, a mere steward
who resides in Metro Manila, who would obviously not be able to afford the
frequent trips to Cebu City in order to follow up his case.
Even the provisions cited by petitioner in support of its contention that
venue of the illegal dismissal case lodged by private respondent is improperly
laid, would not absolutely support his claim that respondent NLRC acted with
grave abuse of discretion in allowing the private respondent to file his case
with the NCR arbitration branch.
Section 1, Rule IV of the NLRC Rules of Procedure on Venue, provides
that:
Section 1. Venue - (a) All cases in which Labor Arbiters have authority to hear and
decide may be filed in the Regional Arbitration Branch having jurisdiction over the
workplace of the complainant/petitioner.
This provision is obviously permissive, for the said section uses the word
“may,” allowing a different venue when the interests of substantial justice
demand a different one. In any case, as stated earlier, the Constitutional
protection accorded to labor is a paramount and compelling factor, provided
the venue chosen is not altogether oppressive to the employer.
Moreover, Section 1, Rule IV of the 1990 NLRC Rules additionally
provides that, “for purposes of venue, workplace shall be understood as the
place or locality where the employee is regularly assigned when the cause of
action arose.” Since the private respondent’s regular place of assignment is
the vessel MV Cotabato Princess which plies the Manila-Estancia-Iloilo-
Zamboanga-Cotabato route, we are of the opinion that Labor Arbiter Arthur
L. Amansec was correct in concluding that Manila could be considered part of
the complainant’s territorial workplace. Respondent NLRC, therefore,
9. committed no grave abuse of discretion in sustaining the labor arbiter’s denial
of herein petitioner’s Motion to Dismiss.
WHEREFORE, premises considered, the instant petition is hereby
DISMISSED for lack of merit.
SO ORDERED.
G.R. No. L-56431 January 19, 1988
NATIONAL UNION OF BANK EMPLOYEES, In Its Own Right And In Behalf Of CBTC EMPLOYEES Affiliated
With It; CBTC EMPLOYEES UNION, In Its Own Right And Interest And In Behalf Of All CBTC Rank And File
Employees Including Its Members,BENJAMIN GABAT, BIENVENIDO MORALEDA, ELICITA GAMBOA,
FAUSTINO TEVES, SALVADOR LISING, and NESTOR DE LOS SANTOS, petitioners,
vs.
THE HON. JUDGE ALFREDO M. LAZARO, CFI-MANILA BRANCH XXXV; COMMERCLKL BANK AND TRUST
COMPANY OF THE PHILIPPINES; BANK OF THE PHILIPPINE ISLANDS; AYALA CORPORATION; MANUEL J.
MARQUEZ; ENRIQUE ZOBEL; ALBERTO VILLA-ABRILLE; VICENTE A. PACIS, JR.; and DEOGRACIAS A.
FERNANDO, respondents.
SARMIENTO, J.:
The sole issue in this special civil action for certiorari is whether or not the courts may take cognizance of claims for
damages arising from a labor controversy.
The antecedentfacts are not disputed.
On July 1, 1977, the Commercial Bank and TrustCompany,a Philippine banking institution,entered into a collective
bargaining agreementwith the Commercial Bank and TrustCompanyUnion,representing the rank and file of the
bank with a membership ofover one thousand employees,and an affiliated local of the National Union ofBank
Employees,a national labor organization.
The agreementwas effective until June 30, 1980, with an automatic renewal clause until the parties execute a new
agreement.
On May 20, 1980, the union,together with the National Union ofBank Employees,submitted to the bank
managementproposals for the renegotiation ofa new collective bargaining agreement.The following day, however,
the bank suspended negotiations with the union.The bank had meanwhile entered into a merger with the Bank of the
Philippine Islands,another Philippine banking institution,which assumed all assets and liabilities thereof.
As a consequence,the union wentto the then Court of First Instance of Manila, presided over by the respondent
Judge,on a complaintfor specific performance,damages,and preliminaryinjunction againstthe private respondents.
Among other things,the complaintcharged:
xxx xxx xxx
51. In entering in to such arrangementfor the termination ofthe CURRENTCBA, and the
consequentdestruction to existing rights,interests and benefits thereunder,CBTC is liable for wilful
injury to the contract and property rights thereunder as provided in Article 2220 of the Civil Code of
the Philippines;
52. By arranging for the termination ofthe CURRENTCBA in the manner above described,CBTC
committed breach ofsaid contract in bad faith, in that CBTC had taken undue advantage of its own
10. employees,by concealing and hiding the negotiations towards an agreementon the sales and
merger,when it was under a statutory duty to disclose and bargain on the effects thereof,
according to law;
xxx xxx xxx
54. In virtually suppressing the collective bargaining rights ofplaintiffs under the law and as
provided in the CURRENTCBA, through shadow bargaining,calculated delay,suspension of
negotiations,concealmentofbargainable issues and high-handed dictation,the CBTC and its
defendantofficials,as well as the BANK OF P.I. and its defendantofficials,were all actuated by a
dishonestpurpose to secure an undue advantage;on the part of the CBTC it was to avoid fresh
and additional contractual commitments,which would substantiallylessen and diminish the
profitability of the sale;and on the part of the BANKOF P.I., it was to avoid having to face higher
compensation rates ofCBTC employees in the course ofintegration and merger which could force
the upgrading ofthe benefit package for the personnel ofthe merged operations,and thereby
pushed personnel costs upwards;substantial outlays and costs therebyentailed were all deftly
avoided and evaded, through the expedientof deliberate curtailmentand suppression of
contractual bargaining rights;
55. All the other defendants have actively cooperated with and abetted the CBTC and its
defendant officers in negotiating, contriving and effecting the above arrangements for the
attainment of its dishonest purpose, for abuse of its rights, and for taking undue
advantage of its very own employees, through the secret sale and scheduled merger; the
collective participation therein evinces machination, deceit, wanton attitude, bad faith,
and oppressive intent, wilfully causing loss or injury to plaintiffs in a manner that is
contrary to law, morals, good customs and public policy, in violation of Articles 21 and 28
of the Civil Code; 1
xxx xxx xxx
Predictably, the private respondents moved for the dismissal ofthe case on the ground,essentially,of lack of
jurisdiction ofthe court.
On November 26, 1980,the respondentJudge issued an order,dismissing the case for lack of jurisdiction.According
to the court, the complaintpartook ofan unfair labor practice dispute notwithstanding the incidental claim for
damages,jurisdiction over which is vested in the labor arbiter. This order, as well as a subsequentone denying
reconsideration,is now alleged as having been issued 'in excess ofhis jurisdiction amounting to a grave abuse of
discretion."
We sustain the dismissal ofthe case,which is,as correctly held by the respondentcourt,an unfair labor practice
controversy within the original and exclusive jurisdiction ofthe labor arbiters and the exclusive appellate jurisdiction of
the National Labor Relations Commission.The claim againstthe Bank of Philippine Islands — the principal
respondentaccording to the petitioners — for allegedlyinducing the Commercial Bank and TrustCompanyto violate
the existing collective bargaining agreementin the process ofre-negotiation,consists mainlyof the civil aspectof the
unfair labor practice charge referred to under Article 247 2
of the Labor Code.
Under Article 248 3
of the Labor Code,it shall be an unfair labor practice:
(a) To interfere with, restrain or coerce employees in the exercise of their rightto self-organization;
xxx xxx xxx
(g) To violate the duty to bargain collectively as prescribed bythis Code;
xxx xxx xxx
11. The act complained ofis broad enough to embrace either provision.Since it involves collective bargaining — whether
or not it involved an accompanying violation of the Civil Code — it may rightly be categorized as an unfair labor
practice. The civil implications thereofdo not defeatits nature as a fundamental labor offense.
As we stated,the damages (allegedly) suffered by the petitioners onlyform part of the civil componentofthe injury
arising from the unfair labor practice. Under Article 247 of the Code,"the civil aspects ofall cases involving unfair
labor practices,which may include claims for damages and other affirmative relief,shall be under the jurisdiction of
the labor arbiters. 4
The petitioners'claimed injuryas a consequence ofthe tort allegedlycommitted bythe private respondents,
specifically,the Bank of the Philippine Islands,under Article 1314 of the Civil Code, 5
does notnecessarilygive the
courts jurisdiction to try the damage suit.Jurisdiction is conferred bylaw 6
and not necessarilyby the nature of the
action. Civil controversies are notthe exclusive domain ofthe courts.In the case at bar, Presidential Decree No.442,
as amended byBatas Blg. 70, has vested such a jurisdiction upon the labor arbiters,a jurisdiction the courts maynot
assume.
Jurisdiction over unfair labor practice cases,moreover,belongs generallyto the labor departmentof the government,
never the courts. In Associated Labor Union v. Gomez, 7
we said:
A rule buttressed upon statute and reason thatis frequentlyreiterated in jurisprudence is thatlabor
cases involving unfair practice are within the exclusive jurisdiction ofthe CIR. By now, this rule has
ripened into dogma.It thus commands adherence,notbreach.
The fact that the Bank of the Philippine Islands is nota party to the collective bargaining agreement,for which it
"cannot be sued for unfair labor practice at the time of the action," 8
cannotbestow on the respondentcourtthe
jurisdiction itdoes nothave. In Cebu Portland CementCo.v. CementWorkers'Union, 9
we held:
xxx xxx xxx
There is no merit in the allegation. In the first place, it must be remembered that
jurisdiction is conferred by law; it is not determined by the existence of an action in
another tribunal. In other words, it is not filing of an unfair labor case in the Industrial
Court that divests the court of first instance jurisdiction over actions properly belonging to
the former. It is the existence of a controversy that properly falls within the exclusive
jurisdiction of the Industrial Court and to which the civil action is linked or connected that
removes said civil case from the competence of the regular courts. It is for this reason
that civil actions found to be intertwined with or arising out of, a dispute exclusively
cognizable by the Court of Industrial Relations were dismissed, even if the cases were
commenced ahead of the unfair labor practice proceeding, and jurisdiction to restrain
picketing was decreed to belong to the Court of Industrial Relations although no unfair
labor practice case has as yet been instituted. For the court of first instance to lose
authority to pass upon a case, therefore, it is enough that unfair labor practice case is in
fact involved in or attached to the action, such fact of course being established by
sufficient proof. 10
xxx xxx xxx
Furthermore,to hold that the alleged tortious act now attributed to the Bank of the Philippine Islands maybe the
subjectof a separate suitis to sanction splitjurisdiction long recognized to be an offense againstthe orderly
administration ofjustice.As stated in Nolganza v. Apostol: 11
xxx xxx xxx
As far back as Associated Labor Union vs. Gomez [L-25999,February 9, 1967,19 SCRA 304] the
exclusive jurisdiction ofthe Court of Industrial Relations in disputes ofthis character was upheld.
"To hold otherwise,"as succinctlystated by the ponente,Justice Sanchez, "is to sanction split
jurisdiction-which is obnoxious to the orderly administration ofjustice."Then, in Progressive Labor
12. Association vs.Atlas Consolidated Mining and DevelopmentCorporation [L-27585,May 29, 1970,
33 SCRA 349] decided three years later, Justice J.B.L. Reyes,speaking for the Court, stress ed that
to rule that such demand for damages is to be passed upon bythe regular courts of justice,instead
of leaving the matter to the Court of Industrial Relations,'would be to sanction splitjurisdiction,
which is prejudicial to the orderly administration ofjustice'.Thereafter,this Court, in the cases of
Leoquinco vs.Canada Dry Bottling Co. [L-28621,February 22, 1971,37 SCRA 535] and
Associated Labor Union v. Cruz ([L-28978,September 22,1971, 41 SCRA 12], with the opinions
coming from the same distinguished jurist,adhered to such a doctrine.The latestcase in point, as
noted at the outset,is the Goodrich Employees Association decision [L-30211,October 5, 1976,73
SCRA 297].
xxx xxx xxx
The petitioners'reliance upon Calderon v.Court of Appeals 12
is not well-taken.Calderon has since lostits persuasive
force, beginning with our ruling in PEPSI-COLA BOTTLING COMPANY v. MARTINEZ, 13
EBON v. DE
GUZMAN, 14
and AGUSAN DEL NORTE ELECTRIC COOP., INC. v. SUAREZ, 15
and following the promulgation of
Presidential Decree No.1691,restoring the jurisdiction to decide moneyclaims unto the labor arbiters.
Neither does the fact that the Bank of the Philippine Islands "was notan employer at the time the act was committed'
abate a recourse to the labor arbiter. It should be noted indeed thatthe Bank of the Philippine Islands assumed "all
the assets and liabilities" 16
ofthe Commercial Bank and TrustCompany.Moreover, under the Corporation Code:
xxx xxx xxx
5. The surviving or consolidated corporation shall be responsible and liable for all the
liabilities and obligations of each of the constituent corporations in the same manner as if
such surviving or consolidated corporation had itself incurred such liabilities or
obligations; and any claim, action or proceeding pending by or against any of such
constituent corporations may be prosecuted by or against the surviving or consolidated
corporation, as the case may be. Neither the rights of creditors nor any lien upon the
property of any of such constituent corporations shall be impaired by such merger or
consolidation. 17
xxx xxx xxx
In sum,the public respondenthas notacted with grave abuse of discretion.
WHEREFORE, the petition is DISMISSED. No costs.
[G.R. No. 110226. June 19, 1997]
ALBERTO S. SILVA, EDILBERTO VIRAY, ANGELES BARON,
CEFERINO ROMERO, JAIME ACEVEDO, RODOLFO JUAN,
ANDREW DE LA ISLA, BAYANI PILAR, ULDARICO GARCIA,
ANANIAS HERMOCILLA, WALLY LEONES, PABLO ALULOD,
RODOLFO MARIANO, HERNANI ABOROT, CARLITO CHOSAS,
VALERIANO MAUBAN, RENAN HALILI, MANOLITO CUSTODIO,
NONILON DAWAL, RICARDO ESCUETA, SEVERINO ROSETE,
13. ERNESTO LITADA, ERNESTO BARENG, BONIFACIO URBANO,
VICENTE SANTOS, MARIO CREDO, BERNABE GERONIMO,
ERNESTO BANAY, PASTOR VELUZ, RICARDO CUEVAS,
FELOMENO BALLON, ORLANDO MENDOZA, ANICETO ARBAN,
GERONIMO ESPLANA, VICENTE CHAVEZ, STEVE VELECINA,
and RICARDO B. VENTURA, petitioners, vs. NATIONAL LABOR
RELATIONS COMMISSION and PHILTREAD (FIRESTONE) TIRE
AND RUBBER CORPORATION, respondents.
D E C I S I O N
ROMERO, J.:
Petitioners, all former employees of private respondent Philtread
(Firestone) Tire and Rubber Corporation (Philtread, for brevity), impute grave
abuse of discretion on the National Labor Relations Commission (NLRC)[1]
for
issuing two resolutions, dated April 7, 1993, and November 18, 1992, which
reconsidered a resolution it rendered on April 15, 1992. They allege that its
resolution of April 15, 1992 became final and executory when Philtread failed
to seasonably file a motion for reconsideration within the ten-day reglementary
period required by Article 223 of the Labor Code.
The record unfolds the following facts:
Sometime in 1985, petitioners, then rank-and-file employees and
members of Philtread Workers Union (PWU), volunteered for, and availed of,
the retrenchment program instituted by Philtread with the understanding that
they would have priority in re-employment in the event that the company
recovers from its financial crisis, in accordance with Section 4, Article III of the
Collective Bargaining Agreement concluded on July 5, 1983.[2]
In November 1986, Philtread, apparently having recovered from its
financial reverses, expanded its operations and hired new personnel. Upon
discovery of this development, petitioners filed their respective applications for
employment with Philtread, which however, merely agreed to consider them
for future vacancies. Subsequent demands for re-employment made by
petitioners were ignored. Even the request of the incumbent union for
Philtread to stop hiring new personnel until petitioners were first hired failed to
elicit any favorable response.
Thus, on December 5, 1988, petitioners lodged a complaint[3]
with the
National Capital Region Arbitration Branch of the NLRC for unfair labor
practice (ULP), damages and attorney’s fees against Philtread.
14. Both parties submitted their respective position papers. On its part,
Philtread moved for the dismissal of the complaint based on two grounds,
namely: (1) that the NLRC lacked jurisdiction, there being no employer-
employee relationship between it and petitioners and that the basic issue
involved was the interpretation of a contract, the CBA, which was cognizable
by the regular courts; and (2) that petitioners had no locus standi, not being
privy to the CBA executed between the union and Philtread.
Petitioners, however, challenging Philtread’s motion to dismiss, stressed
that the complaint was one for unfair labor practice precipitated by the unjust
and unreasonable refusal of Philtread to re-employ them, as mandated by the
provisions of Section 4, Article III of the 1986 and 1983 CBAs. Being one for
unfair labor practice, petitioners concluded that the NLRC had jurisdiction over
the case, pursuant to Article 217 (a) (1) of the Labor Code.
On August 31, 1989, Labor Arbiter Edgardo M. Madriaga rendered a
decision dismissing the complaint but directing Philtread to give petitioners
priority in hiring, as well as those former employees similarly situated for
available positions provided they meet the necessary current
qualifications.[4]
In dismissing the complaint, the Labor Arbiter, however, did not
tackle the jurisdictional issue posed by Philtread in its position paper. Instead,
he dwelt solely on the question whether the petitioners were entitled to priority
in re-employment on the basis of the CBA.
Petitioners duly appealed the decision of the Labor Arbiter to the
NLRC. Philtread opted not to interpose an appeal despite the Labor Arbiter’s
failure to rule squarely on the question of jurisdiction.
On April 15, 1992, the NLRC issued a resolution reversing the decision of
the Labor Arbiter. It directed Philtread to re-employ petitioners and other
employees similarly situated, regardless of age qualifications and other pre-
employment conditions, subject only to existing vacancies and a finding of
good physical condition. This resolution was received by Atty. Abraham B.
Borreta of the law firm of Borreta, Gutierrez and Leogardo on May 5, 1992, as
shown by the bailiff’s return.
Subsequently, Atty. Borreta filed with the NLRC on May 20, 1992, an ex
parte manifestation explaining that he was returning the copy of the resolution
rendered on April 15, 1992, which, according to him, was erroneously served
on him by the process server of the NLRC. He alleged that in the several
conciliation conferences held, it was Atty. Daniel C. Gutierrez who exclusively
handled the case on behalf of Philtread and informed the Labor Arbiter and
petitioners that the law firm of Borreta, Gutierrez and Leogardo had already
been dissolved.
15. Being of the impression that the April 15, 1992 resolution of the NLRC had
been properly served at the address of the law firm of Atty. Gutierrez and that
no seasonable motion for reconsideration was ever filed by Philtread,
petitioners moved for its execution.
On November 18, 1992, the NLRC, acting on a motion for reconsideration
filed by Atty. Gutierrez, promulgated one of its challenged resolutions
dismissing the complaint of petitioners. It ruled that while petitioners had
standing to sue, the complaint should have been filed with the voluntary
arbitrator, pursuant to Article 261 of the Labor Code, since the primary issue
was the implementation and interpretation of the CBA.
Dismayed by the NLRC’s sudden change of position, petitioners
immediately moved for reconsideration. They pointed out that the NLRC’s
reliance on Article 261 of the Labor Code was patently erroneous because it
was the amended provision which was being cited by the NLRC. They added
that the amendment of Article 261 introduced by Republic Act No. 6715 took
effect only on March 21, 1989, or after the filing of the complaint on December
5, 1988. This being the case, petitioners argued that the subsequent
amendment cannot retroactively divest the Labor Arbiter of the jurisdiction
already acquired in accordance with Articles 217 and 248 of the Labor Code.
Petitioners further stressed that the resolution of April 15, 1992, had already
become final and executory since Philtread’s counsel of record did not file any
motion for reconsideration within the period of ten (10) days from receipt of
the resolution on May 5, 1992.
The NLRC, however, was not convinced by petitioners’ assertions. In
another resolution issued on April 7, 1993, it affirmed its earlier resolution
dated November 18, 1992, ruling that even before the amendatory law took
effect, matters involving bargaining agreements were already within the
exclusive jurisdiction of the voluntary arbitrator, as set forth in Article 262 of
the Labor Code. Hence, this petition.
As stated at the outset, petitioners fault the NLRC for issuing the assailed
resolutions even when the resolution sought to be reconsidered had already
attained finality upon Philtread’s failure to timely move for its
reconsideration. They posit that since the bailiff’s return indicated May 5,
1992, as the date of receipt of the April 15, 1992 resolution by the law firm of
Borreta, Gutierrez and Leogardo, Philtread’s counsel of record, then Philtread
only had ten (10) calendar days or until May 15, 1992, within which to file a
motion for reconsideration. Since Philtread indisputably failed to file any such
motion within said period, petitioners deemed it highly irregular and
16. capricious for the NLRC to still allow reconsideration of its April 15, 1992
resolution.
The petition is impressed with merit.
Time and again, this Court has been emphatic in ruling that the
seasonable filing of a motion for reconsideration within the 10-day
reglementary period following the receipt by a party of any order, resolution or
decision of the NLRC, is a mandatory requirement to forestall the finality of
such order, resolution or decision.[5]
The statutory bases for this is found in
Article 223 of the Labor Code[6]
and Section 14, Rule VII of the New Rules of
Procedure of the National Labor Relations Commission.[7]
In the case at bar, it is uncontroverted that Philtread’s counsel filed a
motion for reconsideration of the April 15, 1992 resolution only on June 5,
1992,[8]
or 31 days after receipt of said resolution.[9]
It was thus incumbent upon
the NLRC to have dismissed outright Philtread’s late motion for
reconsideration. By doing exactly the opposite, its actuation was not only
whimsical and capricious but also a demonstration of its utter disregard for its
very own rules. Certiorari, therefore, lies.
To be sure, it is settled doctrine that the NLRC, as an administrative and
quasi-judicial body, is not bound by the rigid application of technical rules of
procedure in the conduct of its proceedings.[10]
However, the filing of a motion
for reconsideration and filing it ON TIME are not mere technicalities of
procedure. These are jurisdictional and mandatory requirements which must
be strictly complied with. Although there are exceptions to said rule, the case
at bar presents no peculiar circumstances warranting a departure therefrom.
The Court is aware of Philtread’s obvious attempt to skirt the requirement
for seasonable filing of a motion for reconsideration by persuading us that
both the Labor Arbiter and the NLRC have no jurisdiction over petitioners’
complaint. Jurisdiction, Philtread claims, lies instead with the
voluntary arbitrator so that when the Labor Arbiter and the NLRC took
cognizance of the case, their decisions thereon were null and void and,
therefore, incapable of attaining finality. In short, Philtread maintains that the
ten-day reglementary period could not have started running and, therefore, its
motion could not be considered late.
The argument is not tenable. While we agree with the dictum that a void
judgment cannot attain finality, said rule, however, is only relevant if the
tribunal or body which takes cognizance of a particular subject matter indeed
lacks jurisdiction over the same. In this case, the rule adverted to is
misapplied for it is actually the Labor Arbiter and the NLRC which possess
17. jurisdiction over petitioners’ complaint and NOT the voluntary arbitrator, as
erroneously contended by Philtread.
In this regard, we observe that there is a confusion in the minds of both
Philtread and the NLRC with respect to the proper jurisdiction of the voluntary
arbitrator. They appear to share the view that once the question involved is
an interpretation or implementation of CBA provisions, which in this case is
the re-employment clause, then the same necessarily falls within the
competence of the voluntary arbitrator pursuant to Article 261 of the Labor
Code.
Respondents’ posture is too simplistic and finds no support in law or in
jurisprudence. When the issue concerns an interpretation or implementation
of the CBA, one cannot immediately jump to the conclusion that jurisdiction is
with the voluntary arbitrator. There is an equally important need to inquire
further if the disputants involved are the union and the employer; otherwise,
the voluntary arbitrator cannot assume jurisdiction. To this effect was the
ruling of the Court in Sanyo Philippines Workers Union - PSSLU v.
Canizares,[11]
where we clarified the jurisdiction of the voluntary arbitrator in this
manner:
“In the instant case, however, We hold that the Labor Arbiter and not the Grievance
Machinery provided for in the CBA has the jurisdiction to hear and decide the
complaints of the private respondents. While it appears that the dismissal of the
private respondents was made upon the recommendation of PSSLU pursuant to the
union security clause provided in the CBA, We are of the opinion that these facts do
not come within the phrase ’grievances arising from the interpretation or
implementation of (their) Collective Bargaining Agreement and those arising from
the interpretation or enforcement of company personnel policies,’ the jurisdiction of
which pertains to the Grievance Machinery or thereafter, to a voluntary arbitrator or
panel of voluntary arbitrators. Article 260 of the Labor Code on grievance machinery
and voluntary arbitrator states that ‘(t)he parties to a Collective Bargaining Agreement
shall include therein provisions that will ensure the mutual observance of its terms and
conditions. They shall establish a machinery for the adjustment and resolution of
grievances arising from the interpretation or implementation of their Collective
Bargaining Agreement and those arising from the interpretation or enforcement of
company personnel policies.’ It is further provided in said article that the parties to a
CBA shall name or designate their respective representatives to the grievance
machinery and if the grievance is not settled in that level, it shall automatically be
referred to voluntary arbitrators (or panel of voluntary arbitrators) designated in
advance by the parties. It need not be mentioned that the parties to a CBA are the
union and the company. Hence, only disputes involving the union and the company
18. shall be referred to the grievance machinery or voluntary arbitrators.” (Underscoring
supplied)
Since the contending parties in the instant case are not the union and
Philtread, then pursuant to the Sanyo doctrine, it is not the voluntary arbitrator
who can take cognizance of the complaint, notwithstanding Philtread’s claim
that the real issue is the interpretation of the CBA provision on re-
employment.
The Court, however, does not write finis to the discussion. A more
important question arises: If the voluntary arbitrator could not have assumed
jurisdiction over the case, did the Labor Arbiter and the NLRC validly acquire
jurisdiction when both of them entertained the complaint?
A brief review of relevant statutory provisions is in order.
We note that at the time petitioners filed their complaint for unfair labor
practice, damages and attorney’s fees on December 5, 1988, the governing
provision of the Labor Code with respect to the jurisdiction of the Labor Arbiter
and the NLRC was Article 217 which states:
“ART. 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 non-agricultural:
1. Unfair labor practice cases;
2. Those that workers may file involving wages, hours of work and other terms and
conditions of employment;
3. All money claims of workers, including those based on non-payment or
underpayment of wages, overtime compensation, separation pay and other benefits
provided by law or appropriate agreement, except claims for employees’
compensation, social security, medicare and maternity benefits;
4. Cases involving household services; and
5. Cases arising from any violation of Article 265 of this Code, including questions
involving the legality of strikes and lockouts.
(b) The Commission shall have exclusive appellate jurisdiction over all cases decided
by Labor Arbiters.”
19. Articles 261 and 262, on the other hand, defined the jurisdiction of the
voluntary arbitrator, viz.:
“ART. 261. Grievance machinery. - Whenever a grievance arises from the
interpretation or implementation of a collective agreement, including disciplinary
actions imposed on members of the bargaining unit, the employer and the bargaining
representative shall meet to adjust the grievance. Where there is no collective
agreement and in cases where the grievance procedure as provided herein does not
apply, grievances shall be subject to negotiation, conciliation or arbitration as provided
elsewhere in this Code.
ART. 262. Voluntary arbitration. - All grievances referred to in the immediately
preceding Article which are not settled through the grievance procedure provided in
the collective agreement shall be referred to voluntary arbitration prescribed in said
agreement: Provided, That termination disputes shall be governed by Article 278 of
this Code, as amended, unless the parties agree to submit them to voluntary
arbitration.”
Under the above provisions then prevailing, one can understand why
petitioners lodged their complaint for ULP with the Labor Arbiter. To their
mind, Philtread’s refusal to re-employ them was tantamount to a violation of
the re-employment clause in the 1983 CBA which was also substantially
reproduced in the 1986 CBA. At the time, any violation of the CBA was
unqualifiedly treated as ULP of the employer falling within the competence of
the Labor Arbiter to hear and decide. Thus:
“ART. 248. Unfair labor practices of employers. - It shall be unlawful for an
employer to commit any of the following unfair labor practice:
x x x x x
x x x x
(i) To violate a collective bargaining agreement.”
On March 21, 1989, however, Republic Act 6715,[12]
or the so-called
“Herrera-Veloso Amendments,” took effect, amending several provisions of
the Labor Code, including the respective jurisdictions of the Labor Arbiter, the
NLRC and the voluntary arbitrator. As a result, the present jurisdiction of the
Labor Arbiter and the NLRC is as follows:
“ART. 217. Jurisdiction of Labor Arbiters and the Commission. - (a) Except as
otherwise provided under this Code the Labor Arbiters shall have original and
20. exclusive jurisdiction to hear and decide, within thirty (30) calendar days after the
submission of the case by the parties for decision without extension, even in the
absence of stenographic notes, the following cases involving all workers, whether
agricultural or non-agricultural:
1. Unfair labor practice cases;
2. Termination disputes;
3. If accompanied with a claim for reinstatement, those cases that
workers may file involving wages, rates of pay, hours of work and
other terms and conditions of employment;
4. Claims for actual, moral, exemplary and other forms of damages
arising from the employer-employee relations;
5. Cases arising from any violation of Article 264 of this Code,
including questions involving the legality of strikes and lockouts; and
6. Except claims for Employees Compensation, Social Security, Medicare and
maternity benefits, all other claims, arising from employer-employee
relations, including those of persons in domestic or household service,
involving an amount exceeding five thousand pesos (P5,000.00) regardless of
whether accompanied with a claim for reinstatement.
(b) The Commission shall have exclusive appellate jurisdiction
over all cases decided by Labor Arbiters.
(c) Cases arising from the interpretation or implementation of collective bargaining
agreements and those arising from the interpretation or enforcement of company
personnel policies shall be disposed of by the Labor Arbiter by referring the same to
the grievance machinery and voluntary arbitration as may be provided in said
agreements.”
while that of the voluntary arbitrator is defined in this wise:
“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. x x x.” (Underscoring supplied)
21. “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.”
With the amendments introduced by RA 6715, it can be gleaned that the
Labor Arbiter still retains jurisdiction over ULP cases. There is, however, a
significant change: The unqualified jurisdiction conferred upon the Labor
Arbiter prior to the amendment by RA 6715 has been narrowed down so that
“violations of a Collective Bargaining Agreement, except those which are
gross in character, shall no longer be treated as unfair labor practice but as
grievances under the Collective Bargaining Agreement. It is further stated
that “gross violations of Collective Bargaining Agreement shall mean flagrant
and/or malicious refusal to comply with the economic provisions of such
agreement.” Hence, for a ULP case to be cognizable by the Labor Arbiter,
and the NLRC to exercise its appellate jurisdiction, the allegations in the
complaint should show prima facie the concurrence of two things, namely: (1)
gross violation of the CBA; AND (2) the violation pertains to the economic
provisions of the CBA.
In several instances prior to the instant case, the Court already made its
pronouncement that RA 6715 is in the nature of a curative statute. As such,
we declared that it can be applied retroactively to pending cases. Thus,
in Briad Agro Development Corporation v. Dela Cerna,[13]
we held:
“Republic Act No. 6715, like its predecessors, Executive Order No. 111 and Article
217, as amended, has retroactive application. Thus, when this new law divested
Regional Directors of the power to hear money claims, the divestment affected
pending litigations. It also affected this particular case. (Note that under par. 6,
where the claim does not exceed P5,000.00, regional directors have jurisdiction).
In Garcia v. Martinez, we categorically held that amendments relative to the
jurisdiction of labor arbiters (under Presidential Decree No. 1367, divesting the labor
arbiter of jurisdiction) partake of the nature of curative statutes, thus:
It now appears that at the time this case was decided the lower court had jurisdiction
over Velasco’s complaint although at the time it was filed said court was not clothed
with such jurisdiction. The lack of jurisdiction was cured by the issuance of the
amendatory decree which is in the nature of a curative statute with retrospective
application to a pending proceeding, like Civil Case No. 9657 (See 82 C.J.S. 1004).
22. Garcia has since been uniformly applied in subsequent cases. Thus, in Calderon v.
Court of Appeals, reiterated that ‘PD No. 1367 [is] curative and retrospective
in nature.
The Decision of this case, finally, acknowledged the retrospective characteristics of
Executive Order No. 111. x x x.”
With the Briad ruling in place, the implication is that the qualified
jurisdiction of the Labor Arbiter and the NLRC should have been applied
when the ULP complaint was still pending. This means that petitioners should
have been required to show in their complaint the gross nature of the CBA
violation, as well as the economic provision violated, without which the
complaint would be dismissible. Herein lies the problem. The Court’s
appreciation of petitioners’ cause of action is that, while it would make out a
case for ULP, under present law, however, the same falls short of the special
requirements necessary to make it cognizable by the Labor Arbiter and the
NLRC. Unsubstantiated conclusions of bad faith and unjustified refusal to
re-employ petitioners, to our mind, do not constitute gross violation of the CBA
for purposes of lodging jurisdiction with the Labor Arbiter and the
NLRC. Although evidentiary matters are not required (and even discouraged)
to be alleged in a complaint, still, sufficient details supporting the conclusion
of bad faith and unjust refusal to re-employ petitioners must be
indicated. Furthermore, it is even doubtful if the CBA provision on re-
employment fits into the accepted notion of an economic provision of the
CBA. Thus, given the foregoing considerations, may the Briad doctrine be
applied to the instant case and cause its dismissal for want of jurisdiction of
the Labor Arbiter and the NLRC?
Upon a careful and meticulous study of Briad, the Court holds that the
rationale behind it does not apply to the present case. We adopt instead the
more recent case of Erectors, Inc. v. National Labor Relations
Commission,[14]
where we refused to give retroactive application to Executive
Order No. 797 which created the Philippine Overseas Employment
Administration (POEA). Under said law, POEA was vested with “original and
exclusive jurisdiction over all cases, including money claims, involving
employer-employee relations arising out of or by virtue of any law or contract
involving Filipino workers for overseas employment,”[15]
which jurisdiction was
originally conferred upon the Labor Arbiter. As in the instant case, the Labor
Arbiter’s assumption of jurisdiction therein was likewise questioned in view of
the subsequent enactment of E.O. 797. In ruling against the retroactive
application of the law, the Court explained its position as follows:
23. “The rule is that jurisdiction over the subject matter is determined by the law in force
at the time of the commencement of the action. On March 31, 1982, at the time
private respondent filed his complaint against the petitioner, the prevailing laws were
Presidential Decree No. 1691 and Presidential Decree No. 1391 which vested the
Regional Offices of the Ministry of Labor and the Labor Arbiters with ‘original and
exclusive jurisdiction over all cases involving employer-employee relations including
money claims arising out of any law or contracts involving Filipino workers for
overseas employment.’ At the time of the filing of the complaint, the Labor Arbiter
had clear jurisdiction over the same.
E.O. No. 797 did not divest the Labor Arbiter’s authority to hear and decide the case
filed by private respondent prior to its effectivity. Laws should only be applied
prospectively unless the legislative intent to give them retroactive effect is expressly
declared or is necessarily implied from the language used. We fail to perceive in the
language of E.O. No. 797 an intention to give it retroactive effect.
The case of Briad Agro Development Corp. vs. Dela Cerna cited by the petitioner is
not applicable to the case at bar. In Briad, the Court applied the exception rather than
the general rule. In this case, Briad Agro Development Corp. and L.M. Camus
Engineering Corp. challenged the jurisdiction of the Regional Director of the
Department of Labor and Employment over cases involving workers’ money claims,
since Article 217 of the Labor Code, the law in force at the time of the filing of the
complaint, vested in the Labor Arbiters exclusive jurisdiction over such cases. The
Court dismissed the petition in its Decision dated June 29, 1989. It ruled that the
enactment of E.O. No. 111, amending Article 217 of the Labor Code, cured the
Regional Director’s lack of jurisdiction by giving the Labor Arbiter and the Regional
Director concurrent jurisdiction over all cases involving money claims. However, on
November 9, 1989, the Court, in a Resolution, reconsidered and set aside its June 29
Decision and referred the case to the Labor Arbiter for proper proceedings, in view of
the promulgation of Republic Act (R.A.) 6715 which divested the Regional Directors
of the power to hear money claims. It bears emphasis that the Court accorded E.O.
No. 111 and R.A. 6715 a retroactive application because as curative statutes, they fall
under the exceptions to the rule on prospectivity of laws.
E.O. No. 111, amended Article 217 of the Labor Code to widen the worker’s access to
the government for redress of grievances by giving the Regional Directors and Labor
Arbiters concurrent jurisdiction over cases involving money claims. This amendment,
however, created a situation where the jurisdiction of the Regional Directors and the
Labor Arbiters overlapped. As a remedy, R.A. 6715 further amended Article 217 by
delineating their respective jurisdictions. Under R.A. 6715, the Regional Director has
exclusive original jurisdiction over cases involving money claims provided: (1) the
claim is presented by an employer or person employed in domestic or household
24. service, or househelper under the Code; (2) the claimant, no longer being employed,
does not seek reinstatement; and (3) the aggregate money claim of the employee or
househelper does not exceed P5,000.00. All other cases within the exclusive and
original jurisdiction of the Labor Arbiter. E.O. No. 111 and R.A. 6715 are therefore
curative statutes. A curative statute is enacted to cure defects in a prior law or to
validate legal proceedings, instruments or acts of public authorities which would
otherwise be void for want of conformity with certain existing legal requirements.
The law at bar, E.O. No. 797, is not a curative statute. x x x.”
We do not find any reason why the Court should not apply the above
ruling to the case at bar, notwithstanding the fact that a different law is
involved. Actually, this is not the first time that the Court refused to apply RA
6715 retroactively.[16]
Our previous decisions on whether to give it retroactive
application or not depended to a great extent on what amended provisions
were under consideration, as well as the factual circumstances to which they
were made to apply. In Briad, the underlying reason for applying RA 6715
retroactively was the fact that prior to its amendment, Article 217 of the Labor
Code, as amended by then Executive Order No. 111, created a scenario
where the Labor Arbiters and the Regional Directors of the Department of
Labor and Employment (DOLE) had overlapping jurisdiction over money
claims. This situation was viewed as a defect in the law so that when RA No.
6715 was passed and delineated the jurisdiction of the Labor Arbiters and
Regional Directors, the Court deemed it a rectification of such defect; hence,
the conclusion that it was curative in nature and, therefore, must be applied
retroactively.
The same thing cannot be said of the case at bar. Like in Erectors, the
instant case presents no defect in the law requiring a remedy insofar as the
jurisdiction of the Labor Arbiter and the Voluntary Arbitrator is
concerned. There is here no overlapping of jurisdiction to speak of because
matters involving interpretation and implementation of CBA provisions, as well
as interpretation and enforcement of company personnel policies, have
always been determined by the Voluntary Arbitrator even prior to RA
6715. Similarly, all ULP cases were exclusively within the jurisdiction of the
Labor Arbiter. What RA 6715 merely did was to re-apportion the jurisdiction
over ULP cases by conferring exclusive jurisdiction over such ULP cases that
do not involve gross violation of a CBA’s economic provision upon the
voluntary arbitrator. We do not see anything in the act of re-apportioning
jurisdiction curative of any defect in the law as it stood prior to the enactment
of RA 6715. The Court view it as merely a matter of change in policy of the
lawmakers, especially since the 1987 Constitution adheres to the preferential
25. use of voluntary modes of dispute settlement.[17]
This, instead of the inherent
defect in the law, must be the rationale that prompted the
amendment. Hence, we uphold the jurisdiction of the Labor Arbiter which
attached to this case at the time of its filing on December 5, 1988.
Finally, the contention that it was Atty. Gutierrez who exclusively
represented Philtread and that the law firm of Borreta, Gutierrez and Leogardo
had been dissolved, are lame excuses to cast doubt on the propriety of
service to Atty. Borreta. It must be noted that the complaint of petitioners was
filed on December 5, 1988. Presumably, the preliminary conferences
adverted to by Atty. Borreta, where Atty. Gutierrez supposedly declared that
he was exclusively representing Philtread, transpired at around that date. The
Court, however, is surprised to discover that the record bears a Notice
of Change of Address dated March 12, 1990, filed by Atty. Gutierrez,
indicating therein that the counsel for respondent (Philtread) was “Borreta,
Gutierrez and Leogardo” whose address could be found at the “3rd Floor,
Commodore Condominium Arquiza corner M. Guerrero Streets, Ermita,
Manila.” If, indeed, Atty. Gutierrez declared during the Labor Arbiter’s
proceedings that he was exclusively representing Philtread, why then did he
use the firm’s name, and its new address at that, in the aforementioned notice
to the NLRC? Moreover, why did Atty. Borreta take fifteen days to file his
Manifestation and inform the NLRC of the “improper” service of the resolution
to him? Why did he not object immediately to the service by the
bailiff? Considering that Atty. Gutierrez and Atty. Borreta were once partners
in their law firm, it behooves Atty. Borreta to have at least advised his former
partner of the receipt of the resolution. As a lawyer, his receipt of the adverse
resolution should have alerted him of the adverse consequences which might
follow if the same were not acted upon promptly, as what in fact happened
here. As for Atty. Gutierrez, if the law firm of Borreta, Gutierrez, and Leogardo
were really dissolved, it was incumbent upon him not to have used the firm’s
name in the first place, or he should have withdrawn the appearance of the
firm and entered his own appearance, in case the dissolution took place
midstream. By failing to exercise either option, Atty. Gutierrez cannot now
blame the NLRC for serving its resolution at the address of the firm still on
record.[18]
To our mind, these excuses cannot camouflage the clever ploy of
Philtread’s counsel to earn a last chance to move for reconsideration. This
Court, it bears emphasizing, is not impressed, but looks incredulously at such
superficial moves.
WHEREFORE, the instant petition is hereby GRANTED. The assailed
resolutions of the NLRC dated November 18, 1992, and April 7, 1993, are
26. SET ASIDE, while its resolution dated April 15, 1992, is REINSTATED for
immediate execution.
SO ORDERED.
Regalado, (Chairman), Puno, Mendoza, and Torres, Jr., JJ., concur.
