2 Nd Case Digest

7/29/2019 2 Nd Case Digest

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A. General Concept

1. Kiok Loy vs NLRC (Policy Declaration)

FACTS:

In a certification election held, the Pambansang

Kilusang Paggawa, a legitimate late labor federation, won and was subsequently certified as the

sole and exclusive bargaining agent of the rank-and-file employees of Sweden Ice Cream Plant.

The Union furnished the Company with two

copies of its proposed collective bargaining agreement. At the same time, it requested the Company

for its counter proposals but the requests were ignored and remained unacted upon by the Company.

As a result, the Union filed a "Notice of Strike",

with the BLR on the ground of unresolved economic

issues in collective bargaining.

In the labor arbiter: due to series of

postponements, and non-appearance at the hearing conducted it ruled that the Company has waived

its right to present further evidence and, therefore, considered the case submitted for resolution.

NLRC: ruled that respondent Sweden Ice Cream

is guilty of unjustified refusal to bargain, in violation

of Section (g) Article 248 (now Article 249)

Issue: WON respondent is guilty of unjustified refusal to

bargain?

Held: YES

The Court affirmed the NLRC, and ruled that, petitioner Company is GUILTY of unfair labor

practice, because the jur isdictional preconditions of Collective Bargaining estab lish such as:

1. possession of the majority representation;

2. proof of majority representation;

3. a demand to bargain under Article 251, par. (a)

Collective bargaining which is defined as negotiations towards a collective agreement, is one of the

democratic frameworks under the New Labor Code, designed to stabilize the relation between labor

and management and to create a climate of sound and stable industrial peace. It is a mutual

responsibility of the employer and the Union and is characterized as a legal obligation.

In the case at bar, (1) respondent Union was a duly

certified bargaining agent; (2) it made a definite request ro bargain, accompanied with a copy of the

proposed Collective Bargaining Agreement, to the Company not only once but twice which were

left unanswered and unacted upon; and (3) the Company made no counter proposal whatsoever all

of which conclusively indicate lack of a sincere desire to negotiate.

From the overall conduct of the company, it is indubitably shown that it disregarded its obligation

to bargain in good faith.

2. Almario vs Philippine Airlines (Nature, Purpose, Interpretation)

G.R. No. 170928, September 11, 2007

Unjust enrichment: Article 22, CC recognizes the principle that one may not enrich

himself at the expense of another.

Form of "enrichment:" Enrichment of the defendant consists in every patrimonial,

physical, or moral advantage, so long as i t is appreciable in money

FACTS:

This is a complaint for reimbursement of training costs filed by PAL against its pilot, Almario.

Almario was initially hired as a Boeing 747 Systems Engineer. Later on, he successfully bid for the

higher position of Airbus 300 First Officer, for which he was given additional training at PALs

expense. After completing the course, Almario served as A-300 First Officer of PAL but after eight

months of service, he tendered his resignation for personal reasons.

PAL then wrote him a letter, stating that they invested heavily on his professional training on the

basis that he continue to serve the Company for a definite period of t ime which is approximately 3

yrs. In short, PAL wanted Almario to reconsider his resignation, otherwise they would be

compelled to ask reimbursement for the training costs from him. Despite this, Almario pushed

through with his resignation. Hence, a reimbursement case was filed.


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In the lower court, PAL invoked the existence of an innominate contract ofdo ut facias (I give that

you may do) with Almario in that by spending for his training, he would render service to it until

the costs of training were recovered in at least 3 yrs. They based the period of 3 yrs to a decision

of the Secretary of Labor concerning PALs CBA with its employee-union.

For his part, Almario denied the existence of any agreement with PAL that he would render service

to it for three years after his training, failing which he would reimburse the training costs. The

lower court ruled in favor of Almario. On appeal, CA found Almario liable under the CBA and

under Article 22 of the Civil Code.

Hence this appeal.

ISSUE:

Whether or not Almario is obliged to reimburse the costs incurred by PAL for his training

HELD:

The petition fails.

The rationale of the three-year period is the prohibitive training costs. At an earlier time, when the

CBA between PAL and its employees were still negotiated, the Secretary of Labor basically ruled

that PAL should be allowed a return on investment for their pilots training expenses. Thus, theprovisions that pilots 57 years of age shall be frozen and pilots less than 57, provided they have

previously qualified in any companys turbo-jet aircraft, shall be permitted to occupy any position

in the companys turbo-jet fleet, were incorporated in later incarnations of the CBA.

When Almario took the training course, he was about 39 yrs old, 21 yrs away from the retirement

age of 60. Hence, with the maturity, expertise and experience he gained from the training course, he

was expected to serve PAL for at least three yrs to offset the prohibitive costs thereof.

Article 22 of the Civil Code applies.

This provision on unjust enrichment recognizes the principle that one may not enrich himself at the

expense of another.

Enrichment of the defendant consists in every patrimonial, physical, or moral advantage, so long asit is appreciable in money. It may consist of some positive pecuniary value incorporated into the

patrimony of the defendant, such as: (1) the enjoyment of a thing belonging to the plaintiff; (2) the

benefits from service rendered by the plaintiff to the defendant; (3) the acquisition of a right,

whether real or personal; (4) the increase of value of property of the defendant; (5) the

improvement of a right of the defendant, such as the acquisition of a right of preference; (6) the

recognition of the existence of a right in the defendant; and (7) the improvement of the conditions

of life of the defendant.

The enrichment of the defendant must have a correlative prejudice, disadvantage, or injury to the

plaintiff. This prejudice may consist, not only of the loss of property or the deprivation of its

enjoyment, but also of non-payment of compensation for a prestation or service rendered to the

defendant without intent to donate on the part of the plaintiff, or the failure to acquire something

which the latter would have obtained. The injury to the plaintiff, however, need not be the cause of

the enrichment of the defendant. It is enough that there be some relation between them, that the

enrichment of the defendant would not have been produced had it not been for the fact from which

the injury to the plaintiff is derived.

In the present case, PAL invested for the training of Almario on the expectation that they may

recover by availing of Almarios services for at least three years. This expectation was not fully

realized, however, due to Almarios resignation after only eight months of service following the

completion of his training course. He cannot, therefore, refuse to reimburse the costs of training

without violating the principle of unjust enrichment.

B. Duty to Bargain

1. Union of Filipino Employees vs Nestle (Meaning of Duty)

acts: Eugenia Nunez, Liza Villanueva, Emmanuel Villena, Rudolph Armas, Rodolfo Kua and

Rodolfo Solidum were either employed as sales or medical representatives of Nestle Philippines.

Said employees availed availed of the companys car loan policy. Nunez, Villena, Villanueva and

Armas were dismissed for having participated in an illegal strike. Kua and Solidum were dismissedfor certain irregularities. Said employees filed complaints for illegal dismissal in the Arbitration

Branch of the NLRC. The Labor Arbiter dismissed their complaints and upheld their dismissal.

They appealed to the NRLC where their appeals are pending. Meanwhile, the company filed a civil

suit to recover possession of the cars subject of the car loan policy, after the dismissed employees

failed and refused to either settle the remaining balance of the cost of their respective cars, or to

return them to the company for proper disposition. The dismissed employees sought a temporary

restraining order in the NLRC to stop the company from cancelling their car loans and collecting

their monthly amortication pending the final resolution of their appeals in the illegal dismissal case.

The NLRC en banc granted the petition for injunction. The company filed a petition for certiorari,

alleging that the NLRC does not have jurisdiction over the issue in the absence of any labor dispute

related to the same. The petition was granted by the Supreme Court, annulling the NLRC

resolution in the petition for injunction.

Issue: Whether there is labor dispute arising or related to the issue involving the car loan policy so

as to provide the NLRC jurisdiction over the petition for injunction.

Topic: Labor Dispute; Definition

Held: [N] Labor dispute includes any controversy or matter concerning terms and 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 the

disputants stand in the proximate relation of employer and employee. The power of the NLRC to

issue writs of injunction, as found in Article 218 of the Labor Code, can only be exercised in a labor


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dispute. Nestls demand for payment of the employees amortizations on their car loans, or, in the

alternative, the return of the cars to the company, is not a labor, but a civil, dispute. It involves

debtor-creditor relations, rather than employee-employer relations. Although the illegal dismissal

case is still pending resolution before the NLRC, the terms of the car loan agreements are not in

issue in the labor case. The rights and obligations of the parties under those contracts may be

enforced by a separate civil action in the regular courts, not in the NLRC.

2. SMC vs NLRC (Deadlock)

Facts: San Miguel Cooperation, alleging the need to streamline

its operations due to financial loses, shut down some of its plants and declared 55

positions as redundant listed as follows: seventeen (17) employees in the Business

Logistics Division ("BLD"), seventeen (17) in the Ayala Operations Center (AOC), and

eighteen (18) in the Magnolia-Manila Buying Station ("Magnolia-MBS")

Respondent union filed several grievance cases for the said retrenched employees,

praying for the redeployment of the said employees to the other divisions of the company.

The grievance proceedings were conducted pursuant to Sections 5 and 8, Article VIII of

the parties' 1990 Collective Bargaining Agreement

During the grievance proceedings, however, most of the employees were redeployed,

while others accepted early retirement. As a result only 17 employees remained when the

parties proceeded to the thi rd level (Step 3) of the grievance procedure. In a meeting on

October 26, 1990, petitioner informed private respondent union that if by October 30,

1990, the remaining 17 employees could not yet be redeployed, their services would be

terminated on November 2, 1990. The said meeting adjourned when Mr. Daniel S. L.

Borbon II, a representative of the union, declared that there was nothing more to discuss

in view of the deadlock.

Union gave notice of strike based on: a) bargaining deadlock; b) union busting; c) gross

violation of the Collective Bargaining Agreement (CBA), such as non-compliance with

the grievance procedure; d) failure to provide private respondent with a list of vacant

positions pursuant to the parties side agreement that was appended to the 1990 CBA; and

e) defiance of voluntary arbitration award

SMC filed complaint with NLRC based on: : (1) the dismissal the notice of strike; (2) an

order compelling the respondent union to submit to grievance and arbitration the issue

listed in the notice of strike; (3) the recovery of the expenses of litigation.

NLRC dismissed complaint

SC: In the case under consideration, the grounds relied upon by the private respondent

union are non-strikeable. The issues which may lend substance to the notice of strike filed

by the private respondent union are : collective bargaining deadlock and petitioner'salleged violation of the collective bargaining

agreement. These grounds, however, appear more illusory than

real.

Collective Bargaining Deadlock is defined as "the situation between the labor and the

management of the company where there is failure in the collective bargaining

negotiations resulting in a stalemate"11 This situation, is non-existent in the present case

since there is a Board assigned on the third level (Step 3) of the grievance machinery to

resolve the conflicting views of the parties. Instead of asking the Conciliation Board

composed of five representatives each from the company and the union, to decide the

conflict, petitioner declared a deadlock, and thereafter, filed a notice of strike. For failing

to exhaust all the steps in the grievance machinery and arbitration proceedings provided

in the Collective Bargaining Agreement, the notice of strike should have been dismissed

by the NLRC and private respondent union ordered to proceed with the grievance and

arbitration proceedings.

As regards the alleged violation of the CBA, we hold that such a violation is chargeable

against the private respondent union. In abandoning the grievance proceedings and

stubbornly refusing to avail of the remedies under the CBA. private respondent violated

the mandatory provisions of the collective bargaining agreement.

Abolition of departments or positions in the company is

one of the recognized management prerogatives.

WHEREFORE, Petitioner San Miguel Corporation and private respondent San Miguel

Corporation Employees Union PTGWO are hereby directed to complete the third level

(Step 3) of the Grievance Procedure and proceed with the Arbitration proceedings if

necessary.


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C. Bargainable Issues

1. Manila Fashions Inc vs NLRC

Manila Fashions, Inc. v. NLRC, 264 SCRA 104 (1996)FACTS: Respondent Nagkakaisang Manggagawa ng Manila

Fashions, Inc., through its president, respondent Nonito Zamora, filed a complaint before the Labor

Arbiter on behalf of its one hundred and fifty (150) members who were regular employees of

petitioner Manila Fashions, Inc. The complaint charged petitioner with non-compliance, with Wage

Order No NCR-02 and 02-A mandating a P12-increase in wages effective 8 January 1991. As a

result, complainants' basic pay, 13th month pay, service incentive leave pay, legal holiday pay,

night shift differential and overtime pay were all underpaid

Petitioner countered that the failure to comply with the pertinent Wage Order was

brought about by the tremendous losses suffered by it which were aggravated when the workers

staged a strike on account of the non-adjustment of their basic pay. To forestall continuous

suspension/closure of business operations, which petitioner did for three (3) months, the strikers

sent a notice that they were willing to condone the implementation of the increase. The condonation

was distinctly stated in Sec. 3, Art. VIII, of the Collective Bargaining Agreement (CBA) dated 4

February 1992, which was voluntarily entered into by the parties and representsa reasonable

settlement The Union realizes the companys closeness to insolvency and, as such , sympathizes

with the companyscondition. Therefore, the Union has agreed, as it hereby agrees, to condone the

implementation of Wage Order o. NCR-02 and 02-A.

The complainants admitted the existence of the aforementioned provision in the CBA;

however they denied the validity thereof inasmuch as it was not reached after due consultation with

the members.

The Labor Arbiter sustained the claim that the subject provision of the CBA was void

but based its conclusion on a different ground :

. . . While it is true that both union officers/members and (petitioner) signed the agreement,

however, the same is not enforceable since said agreement is null and void, it being contrary to law.

It is only the Tripartite Wage Productivity Board of (the) Department of Labor and Employment

(DOLE) that could approve exemption (of) an establishment from coverage of (a) Wage Order . . .

ISSUES: 1. WON the condonation of the implementation of

Wage Order No. NCR-02 and 02-A contained in Sec. 3, Art. VIII,

of the CBA was valid

HELD: NO

Reasoning A Collective Bargaining Agreement refers to the

negotiated contract between a legitimate labor organization and the employer concerning wages,

hours of work and all other terms and conditions of employment in a bargaining unit, including

mandatory provisions for grievances and arbitration machineries. As in all other contracts, the

parties in a CBA may establish such stipulations, clauses, terms and conditions as they may deem

convenient provided they are not contrary to law, morals, good customs, public order or public

policy. Section 3, Art. VIII, of the CBA i s a void provision because by agreeing to condone the

implementation of the Wage Order the parties thereby contravened its mandate on wage increase of

P12.00 effective 8 January 1991. Also, as stated by the Labor Arbiter, it is only the Tripartite Wage

Productivity Board of the DOLE that could approve exemption of an establishment from coverage

of a Wage Order.

If petitioner is a financially distressed company then it should have applied for a wage exemption

so that it could meet its labor costs without endangering its viability or its very existence upon

which both management and labor depend for a living. The Office of the Solicitor General

emphasizes the point thatparties

to a CBA may not by themselves, set a wage lower than the minimum wage. To do so would render

nugatory the purpose of a wage exemption, not to mention the possibility that employees may be

unwittinglyput in a position to accept a lower wage.

The cases that petitioner relies on are simply inapplicable because, unlike the present case which

involves a stipulation in the CBA in contravention of law, they are concerned with compromise

settlements as a means to end labor disputes recognized by Art. 227 of the Labor Code and

considered not against public policy by doctrinal rules established by this Court.

Disposition Petition is dismissed

2. Standard Chartered Bank vs Confessor


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Standard chartered bank-intl bank (resp)

Standard chartered bank employee union ( petitioner )

-

exclusive bargaining agent of the bank file EES

aug. 1990 the bank and the signed a 5 year CBA. With a provision to renegotiate on the 3rd

year. rior expiration of the 3rd year, the union initiated the negotiation

Feb 18, 1993 through its. Pre. Edie Divina Garcia union sent a letter containing its proposals

covering political provisions. With the list of the members of the panel.

Feb 24, 1993 petal harris, banks country manager, sent counter-proposal in non-economic

provisions and also attached list of the member of its panel.

Before commencement of the negotiation, union ( __ divina Garcia ) suggested to banks HR man.

And head of negotiating panel ( diokno ), that bank lawyers should be excluded from the

negotiating team.

-

bank acceded. Diokno suggested tha t umali be excluded. (dube pres.) however

umali was retained thereof.

March 12, 1993 , parties met and set ground rules for the NEG.

-

diokno suggested to keep it a family affair

-

there were provisions in non-economic both parties did not agree

-

both agree to put a notation of deferred/ deadlocked

may 18, 1993 - NEG commenced

- union suggested economic provi

Next MTG. ___ made same presentation. Umali a sked bank to validate unions guest

mated and_____ banks insufficiency of counter proposal.

June 19, 1993 union suggested that if bank wont make necessary changes it would

seek 3rd party.

-

bank made its revised counter- pane l

except for the signing bonus and uniform provisions of the CBA, both did not agree on

the remaining economic provisions.

June 21, 1993 union declared deadlocked and filed notice for strike

Bank filed for ULP against the union charges:

1.

violated its duty to bargain

2.

violated no strike no lockout

3.

ask for damage

Sec. labor and employment (SOLE)

Assured jurisdiction and consolidated complaint

Oct 29, 1993 sole released order dismissing cases against for both parties. And gave

economic awards

Both filed for motion for reco. SOLE denied both.

March 22, 1994 both signed CBA

April 28, 1994, union filed petition for certiorari

Bank prayed for dismissal, that union was estopped as it signed the CBA

SOL. GEN. suggested PFT. Be dismissed

ISSUES

1.

whether or not union was able to substantiate its claim of ULP from banks

alleged interference surface bargaining making bad faith proposals and refusal to

furnish relevant data

a.

interference suggestion made by diokno not anti-union

b.

surface bargaining can be seen in the totality of____ not present. Moreover duty to bargain doestnot compel either part to agree or make a concession.

c.

Bad faith provisions no basis. Many were to be retained

d.

Refusal to furnish data (guest mates) union did not put into

written as required by labor law.

2.

grave abuse of SOLE part.

-

no merit. No showing acted in capricious or arbitrarily.

-

Even if public interest is not a requisite in ULP.

3.

union being estopped from filling suit/ ILP when it signed CBA.-

approval of __ doesnt mean union waived its ULP claim against the bank during

the pas negotiations.

4.

union engaged in blue-sky bargaining

-

bank failed to prove that proposa ls by the union were exaggerated and


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unreasonable.

DISPO

Decision Affirmed. Petition Dismissed.

D. Collective Bargaining Agreement

1. TSPI Corp vs TSPI Corp Employees Union (Definition)

Facts: TSPIC is engaged in the business of designing,

manufacturing and marketing integrated circuits to serve the

communication, automotive, data processing and aerospace industries. TSPIC Employees Union is

the registered bargaining

agent of the rank-and-file employees of TSPIC.

TSPIC and the Union entered into a CBA for the years 2000 to 2004, which included aprovision on yearly salary increases starting January 2000 until January 2002 for regular employees

within the bargaining unit as such: 10% on 1 January 2000, 12% 1 January 2001 and 11% on 1

January 2002.

The same provision also states that the wage/salary increases for the years 2001 and 2002

shall be deemed inclusive of the mandated minimum wage increases under future Wage Orders that

may be issued after Wage Order No. 7, and shall be considered as correction of any wage distortion

that may have been brought about by the said future Wage Orders.

The CBA also provided that employees who acquire regular employment status within the

year but after the effectivity of a particular salary increase shall receive a proportionate part of the

increase: (1st quarter: 100%; 2nd quarter: 75%; 3rd quarter: 50%; 4th quarter: 25%)

1 January 2000 all regular rank-and-file employees received

a 10% increase in their salary, including nine of the respondents.

6 October 2000 Wage Order No. 8 was issued raising the daily minimum wage from 223.50

to 250 effective 1 November 2000.

The wages of 17 probationary employees were increased according to the WO. On various

dates during the last quarter of 2000, these 17 employees attained regular employment and received

25% of 10% of their salaries.

January 2001 TSPIC implemented the CBA-mandated salary increase. As a result, nine

regular employees (respondents) received less wages.

TSPIC's HR Department notified 24 employees that due to an error in the automated payroll

system, they were overpaid and the overpayment would be deducted from their salaries in a

staggered basis, starting February 2001. TSPIC explained that the correction of the erroneous

computation was based on the crediting provision of the CBA.

The Union asserted that this constituted diminution of pay.

TSPIC and the Union agreed to undergo voluntary arbitration on the solitary issue of whether

or not the acts of the management in making deductions from the salaries of the affected employees

constituted diminution of pay.

Arbitrator Jimenez held that the unilateral deduction made by TSPIC violated Art. 100 of the

Labor Code. The CA affirmed this decision.

Issue: Does the TSPIC's decision to deduct the alleged

overpayment from the salaries of the affected members of the Union constitute diminution of

benefits in violation of the Labor Code?

Held: No. The CBA is the law between the parties and they are

obliged to comply with its provisions. If the terms of a contract, as in a CBA, are clear and leave no

doubt upon the intention of the contracting parties, the literal meaning of their stipulations shallcontrol.

Sometimes, though the provisions of the CBA seem clear and unambiguous, the parties

sometimes arrive at conflicting interpretations. Here, TSPIC wants to credit the increase granted by

WO No. 8 to the increase granted under the CBA. The Union, on the other hand, insists that the

crediting provision finds no application in the present case, since at the time WO No. 8 was

issued, the probationary employees were not yet covered by the CBA, particularly by its crediting


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provision.

The CBA states the specific condition that the wage/salary increases for the years 2001 and

2002 shall be deemed inclusive of the mandated minimum wage increases under future wage orders

that may be issued after WO No. 7, and shall be considered as correction of the wage distortions

that may be brought about by the said future wage orders. Thus, the wage/salary increases in 2001

and 2002 shall be deemed as compliance to future wage orders after WO No. 7.

The intention of the parties is clear: As long as an employee is qualified to receive the 12%

increase in salary, the employee shall be granted the 12% increase; and as long as an employee is

granted the 12% increase, the amount shall be credited against any wage order issued after WO No.

7.

Respondents should not be allowed to receive benefits from

the CBA while avoiding the counterpart crediting provision

2. Rivera vs Espiritu (Contract Duration and Renewal)

Facts: As a result of a three week strike staged by PAL pilots

affiliated with the Airline Pilots Association of the Philippines (ALPAP) PAL which was already

financially beleaguered suffered serious losses, PALs financial situation went from bad to worse.

Faced with bankruptcy, PAL adopted a rehabilitation plan and downsized its labor force by more

than one-third. In protest to such action PALEA went on strike which when PAL and PALEA

agreed to a more systematic reduction in PALs work force and the payment of separation benefits

to all retrenched employees. President Estrada thru AO 16 created an Inter-Agency Task Force to

address the problems of PAL.

PAL management submitted to the Task Force an offer by Lucio Tan, Chairman a planto transfer shares of stock to its employees which has a provision regarding the suspension of the

Collective Bargaining Agreements (CBAs) for 10 years. PALEA Members rejected the

offer.Subsequently, PAL informed the Task Force that it was shutting down its operations because

given its labor problems, rehabilitation was no longer feasible, and hence, the airline had no

alternative but to close shop. PALEA sought the intervention of the Office of the President in

immediately convening the parties, the PAL management, PALEA, ALPAP, and FASAP, including

the SEC under the direction of the Inter-Agency Task Force, to prevent the imminent closure

of PAL.After several negotiations a the questioned PAL- PALEA Agreement which provided for

among others the suspension of the PAL-PALEA CBA for a period of ten (10) years, provided the

certain safeguards are in place.

Issue WON the PAL-PALEA agreement stipulating the

suspension of the PAL-PALEA CBA unconstitutional and contrary

to public policy

Held: No. A CBA is a contract executed upon request of either

the employer or the exclusive bargaining representative incorporating the agreement reached after

negotiations with respect to wages, hours of work and all other terms and conditions of

employment, including proposals for adjusting any grievances or questions arising under such

agreement. The primary purpose of a CBA is the stabilization of labor- management relations in

order to create a climate of a sound and stable industrial peace. In construing a CBA, the courts

must be practical and realistic and give due consideration to the context in which it is negotiated

and the purpose which it is intended to serve.

The assailed PAL-PALEA agreement was the result of voluntary collective bargaining

negotiations undertaken in the light of the severe financial situation faced by the employer, with the

peculiar and unique intent ion of not merely promoting industrial peace at PAL, but preventing the

latters closure.

We find no conflict between said agreement and Article 253-A of the Labor Code. Article 253-A

has a two-fold purpose. One is to promote industrial stability and predictability. Inasmuch as the

agreement sought to promote industrial peace at PAL during its rehabilitation, said agreement

satisfies the first purpose of Article 253-A. The other is to assign specific timetables wherein

negotiations become a matter of right and requirement. Nothing in Article 253-A, prohibits the

parties from waiving or suspending the mandatory timetables and agreeing on the remedies to

enforce the same.

In the instant case, it was PALEA, as the exclusive bargaining agent of PALs ground

employees, that voluntarily entered into the CBA with PAL.

It was also PALEA that voluntarily

opted for the 10-year suspension of the CBA. Either case was the unions exercise of its right to

collective bargaining. The right to free collective bargaining, after all, includes the right to suspend

it.


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The acts of public respondents in sanctioning the 10-year

suspension of the PAL-PALEA CBA did not contravene the

protection to labor poli cy of the Constitution. The agreement afforded full protection to labor;

promoted the shared responsibility between workers and employers; and the exerci sed voluntary

modes in settling disputes, including conciliation to foster industrial peace."

Disposition petition is DISMISSED.

3. United Kimberly vs Kimberly-Clark (Interpretation, Administration,

Enforcemenet)

United Kimberly Clark Employees Union-PTGWO v.

Kimberly Clark Phil., G.R. No. 162957, March 6, 2006

FACTS: Petitioner is the labor union representing rank and file

employees of respondent. Way back in 1980, the parties agreed

o include in their CBA a provision which states that the company agrees to employ immediate

relative of an employee who had retired, resigned, died provided that the employee had rendered at

least ten years service. There were no other standards set with regard the acceptance of the said

recommendees and as a matter of fact, even high school graduates were accepted.

In 1991, a case was filed against the company for refusing to employ a nephew of a

retiring employee (Kimberly Clark vs Lorredo) as apparently the retiring employee had children

who he did not recommend and the company was questioning this. In any case, the company lost in

this case but as part of the ruling of the Court, it was stated that Kimberly was not obliged to

unconditionally accept the recommendee

since the latter must still meet the required employment

standard theretofore set by it. Even a qualified recommendee would be hired only on a

probationary status. As such, KCPI was not left without its own safeguards under the agreement.

In 1995, the company issued the now questioned guidelines which among

others required that such recommendees must be at least 18 years of age but not more than 30 years

old at the time of the hiring, and (b) have completed, after graduating from high school, at least a

two- year technical/vocational course or a third year level of college education.

Moreover, where both husband and wife are employees of the company, they shall be treated as one

family; hence, only one of the spouses would be allowed to avail of the benefit. The Union and the

company agreed to postpone the implementation of said guidelines until January 1, 1997 but only

with respect to the educational qualification. And the guidelines were in fact implemented in the

second half of 1998. A voluntary arbitrator ruled on the controversy saying that the company

cannot upgrade the educational qualification as this is contrary to what has been in existence and

what had been a practice.

Appeal was filed with the CA which reversed the resolution of the voluntary arbitrator with regard

the upgrade of the qualification of the recommendee. Hence this appeal.

ISSUE: WON the CA erred in ruling that, under Article XX,

Section 1 of the 1997 CBA, respondent is required to hire only those recommendees of

retired/resigned, deceased or disabled members of petitioner who had completed at least a two-year

HELD: NO. In the present case, the parties are in agreement

that, on its face, Article XX, Section 1 of their 1997 CBA does not contain any provision relative to

the employment qualification standards of recommendees of retired/resigned, deceased or disabled

employees of respondent who are members of petitioner.

However, in determining the employment qualification standards for said recommendees, the VA

should have relied on the November 7, 1995 Guidelines issued by respondent, which reads:

D. Definition of the phrase immediate member of the family of

an employee

1. The phrase immediate member of the family of an employee shall refer to the employees

legitimate children and in default thereof to the employees collateral relatives within the third civil

degree.

2. A resigned/retired employee may be allowed to recommend a collateral relative within the third

civil degree (e.g., brother, sister, nephew or niece) as his/her replacement only in the following

cases:

a. Where the retired/resigned employee is single or if married

has no legitimate children.

b. Where the retired/resigned employees children are still minors (below 18 years old) at the time

of his/her separation from the company. (Emphasis added)


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E. General Provisions

1. The privilege to recommend a replacement can be exercised by the employee concerned only

once. Thus, in the following cases, a recommendee who has been hired on probationary status can

no longer be substituted with another recommendee. a. where the recommendee fails to pass in his

performance evaluation.

b. where the recommendee resigns without completing his

probationary period.c. where the recommendee is dismissed for cause.

d. where the recommendee dies during his probationary period.1

[48]

Respondent issued said Guidelines in light of the ruling of this Court in Kimberly Clark Philippines

v. Lorredo. Respondent saw it imperative to do away with its practice of accommodating

ecommendees who were mere high school graduates, and to

require higher employment standards for them.

By agreement of the parties, the implementation of the Guidelines was deferred until

January 1, 1997, unless revoked or amended by the 1997 CBA.

Petitioner proposed that the practice of

hiring recommendees of retired/resigned, deceased or disabled employees who were union

members, who were at least high school graduates, be included in their CBA, but respondent did

not agree. Hence, Article XX, Section 1 of the 1997 CBA of the parties remained intact. There was

thus no more legal bar for respondent to implement the November 7, 1995 Guidelines. By

executing the 1997 CBA, in its present form, petitioner is bound by the terms and conditions therein

set forth.

The Court has recognized in numerous instances the undoubted right of the employer to

regulate, according to his own discretion and best judgment, all aspects of employment, including

but not limited to, work assignments and supervision, working methods and regulations, time, placeand manner of work, processes to be followed, and hiring, supervision, transfer, discipline, lay off,

dismissal and recall of workers. Encompassing though it could be, the exercise of this right is not

absolute. Management prerogative must be exercised in good faith for the advancement of the

employers interest and not for the purpose of defeating or circumventing the rights of the

employees under special laws, valid agreements such as the individual contract of employment and

the collective bargaining agreement, and general principles of justice and fair play.2[49]

In this case, the

Court finds that respondent acted in accord with the CBA and the November 7, 1995 Guidelines,

which, by agreement of the parties, may be implemented by respondent after January 1, 1997.

Disposition Petition is denied

4. University of San Agustin Employees Union vs Court of Appeals Case Digest (Grievance

Machinery/Voluntary Arbitration)

This is a case between the University of San Agustin Employees Union-FFW (UNION) and The

University of San Agustin (UNIV).

Sometime on 2000, the parties agreed on a 5-year CBA, the economic provisions of which are

effective for 3 years only. After the lapse of 3 years, the parties negotiated on the economic

provisions but did not agree on the terms during the remaining 2 years of the CBA and beyond.

Since the parties did not agree on the computation of tuition incremental proceeds (TIP) which shall

be the basis for the increase of salaries, they underwent a preventive mediation proceedings at the

NCMB.

Still unresolved, the Union declared a bargaining deadlock and thereafter filed a Notice of Strike at

the NCMB, which was expectedly opposed by the Univ through a Motion to Strike-out Notice ofStrike and Refer the Dispute to Voluntary Arbitration, since the CBA contained a "no-strike, no-

lockout" provision, and a grievance machinery for settling disputes, including a voluntary

arbitration mechanism should the grievance machinery fail to settle the dispute. The NCMB,

however, failed to resolved the Univ's Motion

Thereafter, both parties made a joint request for the Secretary of Labor and Employment (SOLE) to

assume jurisdiction over the dispute.

On September 18, 2003, he SOLE assumed jurisdication, and with such assumption of jurisdiction,

any strike or lockout was strictly enjoined.

The day after the SOLE assumed jurisdiction, and on the same day that the Assumption of

Jurisdiction Order (AJO) was supposedly served to both parties, the Union staged a strike. Union

members refused to receive a copy of the AJO assailing that only the Union President is authorizedto receive the same. The Union filed a Petition Declare Illegal Strike and Loss of Employment

Status of the striking employees, which Petition was filed at the NLRC. Such Petition was later on

consolidated with the case pending before the SOLE, at the request of the Univ.

The SOLE rendered a Decision resolving the various economic issues over which the parties had a

deadlock in the collective bargaining, and likewise dismissed the Petition to Declare Illegal Strike.

The University elevated the matter to the Court of Appeals after its Motion for Reconsideration was

denied by the SOLE.


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The Court of Appeals partially granted the Petition. It declared the strike as illegal, but affirmed the

SOLE's decision regarding the economic issues.

Both the Univ and the Union filed their respective Motions for Reconsideration.

Basing on the CA's decision, on April 7, 2005, the Univ served the striking employees with their

notices for termination and concurrently, 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 Universitynotified 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. 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.

Thus, the Union and its dismissed officers file this Petition to the Supreme Court, on the followingissues:

1. Whether or not the strike was illegal and the Union Officers deemed to have lost their

employment status on their failure to return to work immediately upon the service of AJO

issued by the SOLE.

2. Whether or not the economic provisions of the CBA should be referred to Voluntary

Arbitration.

The Supreme Court resolved the foregoing issues as follows:

On the first issue, the SC ruled that ART. 263 of the Labor Code provides: . "..Such assumption or

certification (of the SOLE) 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 outemployees 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 phrase "immediately return to work" indicates an almost instantaneous

or automatic compliance for a striker to return to work once an AJO has been duly served.

Therefore, the act of the striking employees is violative of the foregoing provision.

On the second issue, the Supreme Court ruled that 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, and these matters should be referred to a

Voluntary Arbitrator, as provided in Art. 261 and 262 of the Labor Code. 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.

2 Nd Case Digest

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Transcript of 2 Nd Case Digest