that it lacked jurisdiction. Much as it sympathized with the plightof the petitioners "who apparently have the law on their side," noth-ing could be done. What petitioners should have done was to askfor a reconsideration of the order from the military authorities with-in the period fixed for acting on guerrilla cases, which was until June30, 1948.

Labor Law,-Dismissal of Employee for Physical Defect Visibleat the Time of Employment.

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY V. PHILIPPINELONG DISTANCE TELEPHONE WORKERS UNION (CLO)

G. R. No. L-4157, Prom. July 8, 1952

The State, in the exercise of its police power, has the right tointervene in contractual relations between employers and employeesin matters which affect public interest.! In the exercise of this powerto interfere in employer-employee relations affected with public in-terest, the state may subject to regulation the right of an employerto freely select or discharge his employees, and where the suspensionor dismissal of an employee is whimsical or unjustified or otherwiseillegal, he will be protected.2 The law states 3 and judicial decisions

292) the complaint may properly be dismissed '\:ven though the Renegotiation Actunder which the Secretary proposed to act might be held unconstitutional."

Again citing the case of Ex parte State of N. Y. see note 17 supra at p. 221,it was held that "these caseshold that a public officer can not justify a trespass againsta person's property by invoking the command of an unconstitutional statute. Undersuch circumstances, the tort becomes the officer's individual responsibility, and thegovernment is not held to have sufficient interest in the controversy to be consideredan indispensable party. But the government does not lack such interest in all caseswhere the suit is nominally against the officer as an individual. The government'sinterest must be determined in each case by the essential nature and effect of theproceeding as it appears from the entire record."

1Leyte Land Transportation CO. Y. Leyte Farmers' and Laborers' Union, 45 C.G.No. 11, p. 4862.

2 Manila Trading Supply CO. Y. Philippine Labor Union, 40 C.G. 9th Sup., p. 57;Manila Electric CO. Y. Natio.nal Labor Union, 40 a.G. 9th Sup., p. 132; Manila Trad-ing Supply CO. Y. Zulueta, 40 a.G. 6th Sup., p. 183.

3 Section 19 (Par. 2) Commonwealth Act No. 103 provides: "No employer orlandlord shall suspend, lay-.off, or dismiss any employee, laborer, tenant, or farm-laborer, without just cause, from the time a labor dssociationor organization or groupof laborers or tenants or farm-laborershas presented to an employer or landlord a peti.tion or complaint regarding any matter likely to cause a strike or lockout mentionedin this section, and a copy thereof has been forthwith furnished the Department .ofLabor, or while an industrial or agricultural dispute is pending before the Court. If ifis proved that during the said period an employee or laborer has been suspended ordismissed without just cause, the court may direct his reinstatement and the paymentof his salary .or wage during the time of the suspension or dismissal, or of any sumwhich he should have receivedhad he not been suspended or dismissed,without preju-

have held, that the right to discharge may not be exercised withoutjust cause during the pendency of the dispute in the Court of Indus-trial Relations.4 Neither may such power be exercised to suspendor discharge employees for union activity.5 An employee, further-more, cannot be dismissed for refusal to be transferred where thetransfer is from one organization to another.6 Neither may therebe dismissal when the discharge is predicated upon a mere suspicionof danger or prejudice.7 Even where there is just cause for disci-plinary action against employee, the courts may prohibit dismissalwhere such action would be too severe a penalty for the wrong com-mitted by such employee 8 and the court may in such case reduce theexcessive punishment.9

This right to regulate the. power of employers in the dischargeof their workers has been consistently applied in cases arising underlabor laws. As stated in LU,zonBrokerage v. Samahang Luzon Brok-erage,l° citing Manila Electric Co. v. National Labor Union 11 andManila Trading & Supply v. Zulueta: 12

It is needless to add that the power of the Court of Industrial Rela-tions to protect employees or laborers unjustly dismissed or separated with-out just cause, .and to order their reinstatement, has been judicially recog-nized. I

The instant case 13 involves such power of the Court to regulatethe employer's right to terminate employment by discharge. Brief-ly, the question posed is whether a permanent employee may bedismissd for a physical defect which was at the time of his hiringvisible to the naked eye.

Pedro Labitag, a lineman helper whose work consisted mostlyin digging holes for posts, was already blind in one eye when he

dice to any criminal liability of the employer or landlord as prescribed by section twenty-four of this Act. (As amended by Commonwealth Act No. 355 and Section 5 ofCommonwealth Act No. 559).

4 Manila Trading Supply CO. Y. Philippitne Labor Union, see note 2, supra.5 Manila Electric CO. Y. National Labor Union, 40 D.G. 9th Sup. p. 132; Bohol

Land Transportation Y. BLT Employees Labor Union, 40.D.G. 13th Sup. p. 88; Pepsi-rola, J,nc. Y. National Labor Union, 46 D.G. Stip. to No.1 p. 130.

6 Luzon Brokerage Y. Samahang Luzon Brokerage, G.R. No. L-2950, prom. Sep-tember 13, 1950.

7 Destileria A·yala y Cia., Inc. Y. Liga Nacional Obrera de Filipinas, 47 D.G.No.2, p. 648.

S Batangas Transportation CO. Y. Bagong Pagkakaisa of the Employees and La-borers of the Batangas Trans. Co., 46 D.G. No.9, p. 4236.

11 Tidewater AsrociatiOinOil Y. Victory Employees and Laborers Association, G.R.No. L-2936, prom. December 23, 1949.

10 See note 6, supra.11 &:e note 5, supra.12 See note 2, supra.13 Philippine Long Distance Telephone CO. Y. Philippine Long Distance Workers

Union, 48 D.G. No.7, p. 2676, prom. July 8, 1952.

III Dpinion of th: Board of Conciliation and Arbitration, CI-1O, 1945. SeeSHULMAN AND CHAMBERLAIN, CASES ON LABOR RELATIONS, p. 103.

was hired for the first time by the company. He was able to dohis work without accident and without complaints as to his effi-ciency of several years. Upon a physical examination report ofLabitag's blindness made by the Company doctor, however, the Com-pany dismissed him. The dismissal was sustained by PresidingJudge Roldan but on reconsideration the Court by resolution or-dered the laborer reinstated. The Company petitioned for reviewon certiorari.

It is claimed by the Company that because of Labitag's defect,the danger of injury to himself and to others and to the Companyby reason of the resultant civil liability for whatever injury itsemployee might commit, was greater than ordinary. It is alsoclaimed that the Company has the employer's right to choose and-tire employees without interference from the Court of IndustrialRelations provided it is not done on account of union activities ofthe workers.I4

The Supreme Court affirmed the resolution of the Court orderingthe reinstatement of Labitagon the ground that the worker's blind-ness was "defecto manifesto" 15 and was therefore visible to the of-ficers of the company who hired him, and also on the ground thathe had since employment been doing his work efficiently without ac-cident and complaint. In the words of the Court, "an imagined anti-cipation can not overcome the clear and tangible evidence of actualexperience."

To the petitioner's contention that it is its right to choose andfire employees without undue interference where there is no discrimi-nation for union activities, the Court stated that

The right should not be abused or exercised capriciously, without anyreasonable ground, 'With reference to a worker who has worked faithfullyand satisfactorily for a number of years and who was admitted with hisalleged defect visible and known, for otherwise in future similar cases theexercise of such right might be used as a disguise for dismissing an em-ployee for union adherence.

The right of the state to regulate the employer's right to dis-charge employees as applied to the facts of this particular case seemsto be without precedent in this jurisdiction. The ruling pronounced

14 "The courts have held under a variety of circumstancesthat an employer has aright to discharge men for any reas.onother than union activity, or concerted actionin favor of collectivebargaining." National Labor Relatioms Board Y. Jones and Laugh-lin Steel Corp., 301 U.S. 1, 57 S. Ct. 615; Associated Press Y. National Labor Relations&ard, 301 U.S. 103, 57 S. Ct. 650; National Relations Board v. Union Pacific Stages,Inc., 9 Cir., 99 F 2d 153; C. G. Conn. Limited v. Natiolnal Labor Relations Board,108 F 2d 390 (1939); National Labor Relations Board v. Fansteel Metallurgical Cor-poration, 306 U.S. 240, 59 S. Ct. 490.

15 "Within the meaning of article 1484 of the old Civil Code and article 1561of the new Civil Code. In the Spanish text of article 1484, 'defecto manifesto' isconsideredas equivalent to 'que estuviere a la vista' in contrast-to those which are notro." (Majority decision,Phil. Long pistance Y. Phil. Long Distance Workers Union,see note 13, supra).

appears to be a new one and no Philippine decision seems to even(~loselyapproximate the case in point. It is interesting to note thatthe Supreme Court in its deciRion cited no specific decided case.Neither did the concurring or dissenting opinions cite any decision.

The court, however, in preventing dismissal relied heavily onthe danger of the employer's using the right to discharge for causesother than union activity, as a disguise to discriminate against em-ployees connected with union activity. The prohibition against dis-crimination for union activity is a point well adjudicated in bothPhilippine16 and American law.l7 The rulings enunciated in the ad-judicated cases, however, have to do with prohibition against actiondiscriminatory to union members. They were not for the prohibi~tion against dismissals or other action on grounds which may in thefuture serve as a disguise for the commission of discriminatory actsin matters involving the same circumstances, as is true this case.The ruling enunciated in the case of Destileria Ayala v. Liga Nacio-nal1s may also be remembered when we consider the opinion in re-lation to the petitioner's contention that it is put in great danger of(.'ivil liability for tort as a result of the retention of the employeeblind in one eye. The Destileria case rules that mere suspicion orsimple apprehension of danger or prejudice is insufficient to dismissan innocent employee. The Supreme Court in the Philippine LongDistance, case, however, chose not to consider this point but defendedits decision on the fact that the employee's loss of one eye had beencompensated by the other's becoming keener, his other senses grow-ing more acute, and also that the work did not entail greater dangerto a one-eyed man, and he could, therefore, do his work as safelyand as well as a man who is not blind.

An interesting comparison can be made between the PhilippineLong Distance case and the case of Carnegie-Illinois Steel Corp. (USSteel) an'd Unite1dSteel Workers of America 19 decided by arbitrationin the United States in 1945. In this case the aggrieved employeeafter a number of years of service suffered an injury which causedblindness to his left eye, leaving the right eye unimpaired. Despitethe injury he continued in the employment of the company render-ing the same brand of satisfactory service. In 1944, about a yearfrom the date of such injury, he was denied reinstatement aftera three-month leave of absence on the ground that he was unableto pass the physical examination required of all ,employees absentfor a period in excess of thirty days. The Board although recogniz-ing the Company's right to lay down minimum physical requirements,ordered reinstatement on the following considerations: first, the phy-sical condition at the time of refusal to reinstate was no differentfrom what it was during the lengthy period of employment priorto his leave of absence; second, the responsible members of manage-ment knew of his physical condition at the time he was granted

16 See note 5, supra.17 See note 14, supra.1847 O.G. No.2, p. 648.19 Opinion of the Board of Conciliation and Arbitration, CI-1O, 1945. See

SHULMAN AND CHAMBERLAIN, CASES ON LAeOR RELATIONS, p. 103.

leave but had given no indication that they were planning to denyhis reinstatement upon his return from leave; third, the medical find-ings showed his ability to do satisfactorily the job of chipping with-out endangering the safety of himself and others.

Justice Montemayor in his dissenting opinion assailed the ma-jority decision mainly on the ground that such ruling as that laiddown would force an employer to continue in his employment a la-borer with defective vision whose defect was a potential danger to hisfellow-workers and the public and at the same time make su.ch em-ployer assume the civil liability arising from the employee's negligentand criminal acts.

Both the Civil20 and the Revised Penal Codes21 make an 'employerliable for the negligent and criminal acts of their employees. Underthe Civil Code the employer's civil liability may be avoided by prov-ing the diligence of a good father of a family 22 such as care in theselection of its employees 23 and the supervision of their work.24

This the majority decision, the Justice claims, prevents the employerfrom doing by forbidding the discharge of the employee with de-fective eyesight. Furthermore, any error or negligence the companymight have made in hiring a man with defective eyesight cannot,because of such ruling, be corrected. In addition the company is"compelled to persist in and perpetuate said error and continue toabet a potential danger and menace to his fellow-workers and thepublic."

Justice Montemayor expressed his apprehension over the effectwhich the majority ruling would have on the employer's right toprotect himself from civil liability arising from his employee's acts.

20 Article 2180, Civil Code (par. 4): "The owners and managers of an establish-ment or enterprise are likewise responsible for damages caused by their employees inthe service of the branches in which the latter are employed or on the occasion of theirfunctions.

"Employers shall be liable for the damages caused by their employees andhousehold helpers acting within the scope of their assigned tasks even though theformer are not engaged in any business or industry."21 Art. 102. Subsidiary civil liability of innkeepers, tayernkeepers, and proprietors

of establishments.-In default of the persons criminally liable, innkeepers, tavernkeepers,and other persons or corporations shall be civilly liable for crimes committed in theirestablishments, in all cases where a violation of municipal ordinances or some generalor special police regulation shaH have been committed by them or their employees.

* * * * * * * *"Art. 103. Subsidiary ciyilliability of other persons.-The subsidiary liability estab-

lished in the next preceding article shall also apply to employers, teachers, persons andcorporations engaged in any kind of industry for felonies committed by their servants,pupils, workmen, apprentices, or employees in the discharge of their duties."

22 Art. 2180, New Civil Code (Par. 8): "the responsibility treated of in thisarticle shall cease when the persons herein mentioned prove that they observed all thediligence of a good father of a family to prevent damage."

23 Lilius Y. Manila Railroad, 59 Phil. 758; Bahia Y. LitOinjuaand Deynes, 30 Phil.624; Chavez and Garcia Y. Manila Electric, 31 Phil. 47.

24 Yamada Y. Manila Railroad, 33 Phil. 8; Bahia Y. Litonjua and Leynes, see note23, supra; Cerf Y. Medel, 33 Phil. 37; Lilius Y. Manila Railroad, see note 23, supra.

•

The present case is illustrative of the union's growing inter-ference in management control. The demand for job security hasbee.n intensified. Where unions before were content to bargain overbasic conditions of employment such as wages, hours, and relatedemployment benefits, they have now extended their demands to newareas of interest.25

Yet it is apparent that despite both governmental and unioninterference with management control, a certain amount of the func-tions and responsibilities of management must remain in the handsof those charged with running the business. Stated otherwise, tothe management belong certain prerogatives 26-fields which theunion should leave to managerial discretion. To maintain that ma-nagement has no prerogatives would be to fail to recognize organi-zational functions.27 Following the same trend of thought, LudwigTeller states that

business efficiency and .responsibility require that the exercise of manage-ment functions,28 if done in good faith, should be allocated to managementand not diluted with participation of third parties, whether Labor unions,arbitrators, or others not responsible for the operation of the business.29

One such management prerogative according to the same authoris the determination of employee competence.30 But the cases citedby Teller under this management prerogative at most recognize onlythe factor of competence, as determined by management, as a qua-lification of seniority provisions governing job assignments, promo-tions, or transfers 31a.nd do not touch upon discharge for incompe-tency due to physical defect as determined by management.

It would appear from American cases, however, that the rightto hire and fire is still a managerial function,32 and that the em-ployer may exercise his normal prerogatives in hiring and firing em-ployees so long as his action is not discriminatory against union ac-

25 TELLER, MANAGEMENT FUNCTIONS UNDER COLLECTIVE BARGAINING, p. 12.26 Teller cites eight:

1. Methods of plant operation.2. Subcontracting of work.3. Determination of supervisory force.4. Plant discipline.5. Overtime work.6. Incentive wage plans.7. Job content and evaluation.8. Determination of employee competence.

Gp. cit., pp. 34-49.27 CHAMBERLAIN, THE UNION CHALLENGE TO MANAGEMENr CONTROL, p. 197.28 What Chamberlain terms management prerogatives, Teller calls management

functions.29 Teller, op. cit., p. 116.30 Teller, op. cit., p. 46.31 Teller, op. cit., p. 47.32 National Labor Relations Board 'Y. Rock Hill Printing & Fjnjsh~ng Co., 4 eir.

131 F (2nd) 171. '

tivities,33 and when exercised for ordinary ends, the right to employand discharge remains inviolate and unabridged.34

Considering the foregoing, union interference apparently wouldbe greatly dependent upon whether a certain act is a managementprerogative or not.

Going back to the Philippine Long Distance case, the questionmay well be asked: Does the act of an employer in discharging anemployee with a physical defect in order to protect himself fromfuture civil liability fall under any class of management prerogative?

Under the present case, an employer's action in discharging aphysically defective employee, though exercised in good faith, wouldbe prohibited where danger exists of the employer's using such actionto cloak future discrimination against union activity.

Clearly the ruling detracts from that right of the employer tohire and discharge employees. It also diminishes the employer'sright to determine the competency of his workers.

The decision adds a new doctrine to the numerous cases con-struing the right of an employer to discharge his employees, in thiscase, particularly on the ground of physical disability apparent atthe time of the hiring. Future cases arising under similar circum-stances will serve to show the wisdom and practicability of the rul-ing.

Labor La,w-Validity of Check-Off

A. L. AMMEN TRANSPORTATION CO., INC. VS. BICOL TRANSPORTATIONEMPLOYEES MUTUAL ASSOCIATION AND

THE COURT OF IDUSTRIAL RELATIONS,48 OG No. 7,2733

Unlike in the United States there is no law in the Philippinestoday expressly providing for the system of check-off. Attention isinvited, however, to Republic Act No. 602,1 otherwise known as the

33 See note 14, supra. Also, Phelps Dodge Y. NLRB 313 US 177; Kansas CityPower & Light CO. Y. NLRB, 111 F (2nd) 340; NLRB Y. Gosben Rubber Co., 110 F(2nd) 432; Stonewall Cotton Mills Y. NLRB, 129 F (2nd) 629; Montgomery-WdTdCO. Y. NLRB, 107 F (2nd) 555.

34 Jefferson Electric CO. Y. NLRB, 102 F (2nd) 949; Western Cartridge CO. Y.

NLRB, 139 F (2nd) 855; Harp Y. NLRB, 138 F (2nd) 546; NLRB Y. Denver Tentand Awning Co., 138 F (2nd) 410; Budd Manufacturing CO. Y. NLRB, 138 F(2nd) 86. _

1Section 10 of Republic Act No. 602 provides:* * * * * * *

"(b) Wages, including wages which may be paid retroactively for whatever reason,shall be paid directly to the employee to whom they are due, except:

* * * * * * *

Minimum Wage Law, which attempts to recognize the system. Asan aid to union security,2 the check-off has been sought by labor or-ganizations the world over.3 For security, as well as financial re-turns, it is part of labor's goal. 4.

"Check-off" has been invariably defined as the act of the em-ployer in deducting from wages the amount of union dues payableby an employee member.s The deduction sometimes extends to as-sessments and fines which the union might levy against the em-ployees.6 The assessments, however, must be for general union pur-poses only.7 In kind, the check-off may be voluntary or involuntaryand revocable or irrevocable by the employee. 8 Like the "closedshop" its efficacy and enforcement depends upon a contract.9 It cannot be imposed upon any party by the force of a judicial decision.I°

In the United States the check-off system is provided and re-gulated by statute.ll Due to the Taft-Hartley Act,l2 several statesof the Union have passed legislation recognizing the right of indi-vidual members of a union to refrain from a compulsory check-off.13

(3) In cases where the right of the employees or his union to check-off has beenrecognized by the employer or authorized in writing by the individual employees con-cemed."

2 "Union security is simply security in the maintenance of the strength and theintegrity of the union. (Matter of Ford Motor Co. of Canada, 1 Lab. Arb. Rep.,439, cited in Cox, CASES ON LABOR LAW, p. 1178.)

3 ROTHENBERG, LABOR RELATIONS, p. 54. "The check-off is a device of greatutility to the unions and is universally sought by them. The source of a union'sstrength is not only its affiliations and membership, but its revenue as well. Its stab-ility and force is usually commensurate with its financial solidity. Inasmuch as duesconstitute the primary stream of union income, the importance of check-off lies inits assurance of payment of dues."

4 DE SCHWEINITZ, LABORAND MANAGEMENT IN A COMMON ENTERPRISE, p.·126.5 Matter of Ford Motor Co. of Canada, see note 2, supra.6 TELLER, THE LAW GOVERNING LABOR DISPUTES AND COLLECTIVE BARGAIN-

ING, Yol. 1, pp. 111,112.7 Ford Motor Co. of Canada and United Automobile Workers, 1 L. A. 439, 443,

cited in SHULMAN AND CHAMBERLAIN, CASES ON LABOR RELATIONS, p. 1196.8 HILL AND HOOK, MANAGEMENT AT THE BARGAINING TABLE, p. 42. "The

check-off has generally been associated with the closed shop and other objectionableforms of compulsory unionism."

1l Allied Workers' Association of the Philippilles, Bais Chapter ". Central Azuca-]'eda de Bais-Laborers' and Employee's Union, CIR No. 135·Y, promulgated Sep-tem,ber 7, 1948.

10 Dee Cho Workers (CLG) 'I'S. Dee Cho Lumber Co., CIR No. 76-V (44 C.G.No.3, p. 988).

11 RAMSAY PRESS, LABOR IN POSTWAR AMERICA, p. 34. "After the Taft.HarleyAct became law in June, 1947, check-off clauses as they came up for renewal had tobe revised to conform to the law. The Act requires all check-off of dues to be volun-tarily and individually authorized, although such authorizations may be made irrevo-cable for the contract term or one year, whichever is shorter."

12 Passed June, 1947.13 SEYMOUR PHILIP KAYE, THE RIGHTS OF INDIVIDUAL EMPLOYEES UNDER

STATE STATUTES,.cited in New York Uni"ersity's Third Annual Conference Otn Labor,pp. 558, 559.

Utah, however, passed a law compelling an employer to check-offwhen the employee executes and delivers to him an instrument inwriting containing the proper authorization.14 While the check-offis ordinarily practised by private employers, it has been held that itis within the power of a municipal corporation, upon the individualvoluntary request of its employees, to check-off their unions dues.15

In the instant of AmmenTransportation Co., Inc. the petitionerwas ordered by the respondent court "to continue its former practiceof allowing check-off to petitioning union whose affiliates have al.-ready filed with the management their corresponding authority tomake the necessary deductions from their monthly earnings." Itappears that as a result of a labor dispute between the petitioner com-pany and its workers numbering 308, the latter who are affiliatedto the respondent union declared a strike. The dispute was partial-ly settled when the Court of Industrial Relations ordered the reopen-ing of the business of the petitioner company and the return of theemployees involved in the strike under the same terms and condi-tions of employment existing before the strike. In the meantimethe respondent court directed the respondent union to present all un-solved differences in a detailed petition with a view to completelysettling the dispute. In compliance with this direction, the respond-ent union filed a petition embodying the demand which was grantedby the court in its questioned decision. The sole issue posed beforethe Supreme Court is the authority of the Court of Industrial Re-lations to compel the petitioner to continue the practice of check-offagainst its will.

The Supreme Court held that the Court of Industrial Relationshas the authority under its comprehensive and all-embracing po-wers.16 There is nothing so peculiar in check-off that it cannot betaken cognizance of by the Industrial Court. On the contrary, theCourt observed, the practice of deducting dues from wages and pay-ment of the amounts deducted over to the union appears to be moregermane to wage fixing than are vacation leave or the defrayingof hospitalization expenses by the management. As a normal in-cident of employment, check-off is a legitimate dispute for arbitra-

14 Cited in KILLINGSWORTH,STATE LABORRELATIONSACTS, p. 282.15 Mugford 'Vs. Baltimore, 44 A. (2d) 745, 747.16 Commonwealth Act No. 103, sec. 4: "The Court shall take cognizance for

purposes of prl'vention, arbitration, decision, and settlement, of any industrial or agri-cultural dispute causing or likely to cause a strike or lockout, arising from differencesas regards wages, shares or compensation, dismissals, lay-offs, or suspensions of em-ployees or laborers, tenants or farm laborers, hours of labor or conditions of tenancyor employment, etc."

Section 13 of the same Act: "In making an award, order or decision, under theprovisions of section four of this Act, the Court shall not be restricted to the specificrelief claimed or demands made by the parties to the industrial or agricultural dispute,but may include in the award, order or decision any matter of determination whichmay be deemed necessary or expedient for the purpose of settling the dispute or ofpreventing further industrial or agricultural disputes."

tion. The duty of the Court of Industrial Relations in such a casebecomes positive.17

Justice Montemayor dissented in the instant case on the groundthat it would be unfair, unjust, and unsportsmanlike to compel theemployer to help and strengthen the instrument and agency usedby its adversary to fight against it. He vigorously asserted the wantof a law compelling an employer to practice and observe the systemof check-off. This dissent, however, loses sight of the fact that thestruggle between labor and capital is essentially unequal. Even ourConstitution recognizes this inequality,18

It is significant to note that the instant case is the first case ofcheck-off brought up for consideration and determination by theSupreme Court. The ruling announced in this case seems to departfrom the constant doctrine of the Supreme Court to uphold the free-dom of employers to contract.19 It tends to modify the decisionsof the Court of Industrial Relations to the effect that check-off shouldbe the product of agreement.20 The basis of the decisions of theCourt of Industrial Relations is that the consent of the employer mustfirst be obtained as the check-off arrangement burdens him withextra clerical work. In the instant case the employer is sought tocontinue its former practice as a step nearer toward the solutionof the controversy. In sustaining the continuance of the practicethe Supreme Court proceeded on the theory that check-off is com-pulsory on the part of the employer under certain conditions. Thedecision of the Court is no doubt influenced by R. A. No. 602, or theMinimum Wage Law, which took effect during the pendency of thecase in the Supreme Court. The majol'ity of the Court construedsec. 10, par. 3 of the Act,21 thus-

"Our underst.anding of this provision, which is none too clear, is thatthe two clauses are independent of each other, each denoting a separate

17 Manila Cordage Co. ys. Mamila Cordage Worker's Union, CIR No. 74-Y (43OG No. 10, p.4272). "It is not only the privilege of the Court to intervene in thepeaceful setrlement of any industrial dispute but it is its duty and obligation to exer-cise its power to decide what is reasonable and equitable for both labor and capital.

, Law and equity should be applied. Any unreasonable demand on the part of laboror refusal on the part of capital to reasonable demands constitute an abuse. Whenthis point is reached, it becomes the duty of the court to put its brake to stop saidabuse that may be committed by any party in any industrial dispute."

18 Article XIV, Sec. 6: "The State shall afford !?rotectionto labor, especially toworking women and minors, and shall regulate the relations between landowner andtenant, and between labor and capital in industry and in agriculture. The State mayprovide for compulsory arbitration."

19 Pampanga Bus CO. YS. Pambusco Employees Union, 68 Phil. 541. The Courtheld: "The general right to make a contract in relation to one's business is an essentialpart of the liberty of citizens protected by the due process clause of the Constitution."

20 Manggagawang Nagkaisa (CLO) ys. Laguna Coconut Products, CIR No. 64.Y(43 OG No. 11, p. 4809); Batangas Transportation Co. ys. Bagong Pagkakaisa, CIRNo. 19·Y (43 OG No. 11, p. 4813); Manila Trading and Supply Co. ys. ManilaTrading Laborers Association, CIR No. 72-Y (44 OG No.1, p. 173).

21 Section 10(3) of R. A. 602, ~eenote 1, supra.

meaning. In other words, check-off may be enforced with the consent ofthe employer or by authority in writing by the employees. When theunion and the employer agree, the attitude of the employee is immaterial.When the employees duly authorize the check-off, as provided by the lastclause, the employer's consent is unnecessary and its recognition of theright is oblig,atory. If this were not so; if in any case the employer'sconformity were essential, it would have to be concluded that the secondclause is superfluous and meaningless, for the first clause already providesfor such conformity as a condition precedent."

The majority of the Court, ho\vever, admits' that its pronounce-ment is tainted with supposition. Its construction of the aforemen-tioned section does not sound of finality. Its observation thereforedoes not truly reflect the basic concept of contracts-consent-es-pecially when the obligation imposed is unilateral.

At any rate the position taken by the Supreme Court is guidedby practical considerations. There is the imminent disruption oftransportation service to the prejudice of the public interest unless thelabor dispute be finally adjudicated. There is the observation thatwhile the practice may put the company to extra work and expense,it in effect brings about savings in time and money upon which thecompany stands to benefit in the long run. Then there is the feelingthat justified the Supreme Court to return the status quo in the inter-est of conciliation and peace.

Labor La:w-Strike Covering New But Valid Demands NotWithin the Power of the Comp,a;nyof Grant, Legal NotwithstandingExisting Labor Agreement.

CENTRAL VEGETABLE OIL MANUFACTURING Co., INC. V. PHILIPPINEOIL INDUSTRY WORKERS UNION (CLO), (C.V.C. LOCAL), ET AL.

G.R. No. L-4061, Prom. May 28, 1952

In this case, petitioner Central Vegetable Oil Manufacturing Co.Inc., and the respondent Philippine Oil Industry Workers Union en-tered into an agreement, approved by the Court of Industrial Rela-tions. The agreement was entered into in contemplation of the in-stallation of new machineries of the company. At a time when newmachineries were being installed in the new oil mill, twenty-fourlaborers of the Union were laid off. They were, however, allowedto work one day each week upon demand. Subsequently, during theeffectivity of the agreement, the Union presented a 14-point petitionto the company and in addition asked the company to allow the twen-ty-four laborers a minimum of two working days per week. Thesedemands were turned down, the company insisting that the Unionshould appoint a representative who, with the company, could fix thescales of wages of the laborers in accordance with the agreement.'rhereafter the 24 laborers failed to report for work. Petitionerseeks the discharge of said laborers on the ground that they declaredan illegal strike. The Supreme Court proceeding on the assumption

that there was a strike held the strike legal and affirmed the orderof reinstatement by the Court of Industrial Relations.

1'he question pertinently may be asked: How does this decisionaffect the law on strikes in the Philippines?

A strike is a concerted refusal by workers to continue workingas a method of persuading or coercing the employer to comply withtheir demands.1 In this case there was a concerted suspension ofwork when the twenty-four laborers failed to report for work "uponrefusal of the company to discuss the 14-point petition of the Unionand to concede at least two working days a week."

In this jurisdiction, the right to strike has been recognized.2The right, however, is not absolute. In order to be justified, a strikemust be for a legal purpose and must be carried on through legalmeans.3 Better working conditions, including sick leave, maternityleave, medical treatment, and hospitalization, and more working daysare legitimate ends as held in the instant case.4 Nevertheless, astrike for a lawful purpose and through legal means may still be heldillegal if the purpose is trivial, unjust, or unreasonable.5 It was

1TELLER,LABORDISPUTESANDCOLLECTIVEBARGAINING,pp. 236-237, sec. 78.2 "While it is apparent that the policy of the State is, in the first place, to appeal

to voluntary arbitration in the settlement of industrial or agricultural disputes and,in the second place, to employ mediation or conciliation for that purpose and, lastly,to recur to the more effective system of official investigation and compulsory arbitra-tion in order to determine specific controversies between labor and capital in industryand in agriculture, it cannot be said that strikes are under no condition or circum-stance justified." (Rex Taxicab Company '1'. Court, 40 a.G., 9th Sup., p. 136).

This ruling on the validity of strikes was followed in the case of Dee C. Chuan& Sons '1'. Court of Industrial Relations, G.R. No. L-2548, Prom. January 28, 1950).

3 "In cases not falling within the prohibition, the legality or illegality of a strikedepends, first, upon the purpose for which it is maintained, and, second, ':.eon themeans employed in carrying it on." (Rex Taxicab Company '1'. Court, supra).

4 "The demand for two working days a week, even regardless of th05e for sickl€ave, maternity leave, medical treatment and hospitalization, is the most legitimatethat can be presented by any laborer, for it affects his very right to live. We neednot stretch our imagination or power of reasoning to realize that the laborer who hasto feed and clothe himself and his family for seven days a week, cannot survive onone day's wage."

"American judicial decision is now in general agreement that labor possesses aright to participate in a primary strike, where the workers' complaints have referenceto wages, hours or other conditions of immediate employment." (TELLER, LABORDISPUTESANDCOLLECTIVEBARGAINING,pp. 249-254, Sec. 85).

5 "The law does not expressly ban strikes except when enjoined against by theCourt; but if a strike is declared for a trivial, unjust or unreasonable purpose, or if itis carried out through unlawful means, the law will not sanction it and the court willdeclare it illegal, with the adverse consequences to the strikers.' (Luzon Marine De-partment Union '1'. Roldan, G.R. No. L-2660, prom. May 30, 1950).

"The plea of the laborers for better conditions and for more working days cannotbe said to be trivial, unreasonable or unjust, much less illegal, because it is not onlythe inherent right but the duty of all free men to improve their living standardsthrough honest work that pays a decent wage." (Central Vegetable Oil ManufacturingCo., Inc '1'. Phil. Oil Industry Union, et al., supra).

held in the present case that the fact that the demands that gaverise to the strike may not properly be granted under the circum-stances should not make said demands and the consequent strike il-legal.6

During the effectivity of an award, order or decision of the Courtof Industrial Relations, a strike may be declared.7 The only prohibi-tion to declare a strike exists when the Court of Industrial Relationshas issued the proper injunction against the striking laborers.s Andtven where a strike has been enjoined, injunction does not precludea future strike over new demands.9 In the instant case the majorityopinion did not assert that if the strike violated the agreement, thestrike is illegal. The strike for a purpose not comprised in theargeement was declared legal. In addition, it was stated that anabsolute prohibition to demand more working days or better condi-tions for the laborers will be patently immoral if not illegal. "Atany rate, we think that the fixing of wages should be subordinatedto the more urgent and important matteI' of threshing out the ques-tion of granting two working days to the laborers." 10

6 "The demands that gave rise to the strike may not properly be granted underthe circumstancesof this case, but that fact should not make said demands and theconsequent strike illegal. The ability of the Company to grant said demands is onething, and the right of the laborers to make said demands is another thing. The lat-ter should be inviolate. There are adequate instrumentalities which may be resortedto in case of excesses."

1"A strike is not in itself inconsistentwith or destructive of the efficiencyof anaward or decision, since the Court of Industrial Relations in proper cases may enforcethe same during the statutory period. In other words, an employer, as soon as thelaborerswalk out, may resort to said court and defeat the aims of the strike by allegingthe existenceof a binding decision settling a previous similar industrial dispute, subjectof course to the power of the court to reopen any question involved therein." (DeeC. Clman & Sons Y. Court of Industrial Relations, supra).

"An award, order or decisionof the Court shall be valid and effectiveduring thetime therein specified. In the absenceof such specification,any party or both partiesto a controversymay terminate the effectivenessof an award, order or decisionby givingnotice to that effect to the Court: Provided, Howeyer, That at any time during theeffectivenessof any award, order or decision, the Court may, on application of aninterested party, and after due hearing, alter, modify in whole or in part, or set asideany such award, order or decision, or reopen any question involved therein." (Com.Act No. 103, Sec. 17).

8 "The employee, tenant or laborer is inhibited from striking or walking out ofhis employment only when so enjoined by the Court of Industrial Relations and aftera dispute has been submitted thereto and pending award or decision by the court ofsuch dispute." (Rex Taxicab CO. Y. Court, supra).

"A strike may not be staged only when, during the pendency of an industrialdispute, the Court of Industrial Relations has issued the proper injunction against thelaborers." (Dee C. Chuan & Sons Y. CIR, supra).

9 Philippine Labor Organization Y. Caltex, CIR-Case No. l1Z-V (10), July 31,1950.

10 Cemtral Vegetable Oil Manufacturing Co., Inc. Y. Philippine Oil Industry Work-ers Union, supra.

There is no departure from the prevailing doctrine that a strikeviolative of a labor agreement is tainted with illegality.ll Nonethe-less, it is submitted that the decision of the present case is a sub-stantial victory for labor, with the Court resolving all doubts in itsfavor.12 It seems that a strike would not be illegal where it pur-ports to be staged for an object not comprised within a subsistinglabor agreement, regardless of whether or not the agreement is alsoviolated in the process.13 Not only do the striking laborers retaintheir jobs,14they also receive their back wages if they were dismissedin consequence of the strike. Management cannot prevent this si-tuation because even though the agreement contains a prohibitiveclause against strike, if one is nevertheless declared for better work-ing conditions or more working days, as in this case, the clauseis ineffectua.l.l5

11 This is the basis of the dissenting opinion: "It is apparent that the impellingmotive of the 24 laborers in declaring a strike is the refusal of the company to agreeto their demand not to follow the wages paid by the Philippine Refining Companybecause they were low in view of the absenceof labor union in the said company, letalone the other thirteen demands that they included in their petition which the com-pany refused to discussunless the question of wageshas been settled, and not preciselytheir avowedclaim for more working days during the stoppage of the operation of theoil mill. It is for this reason that I dissent from the opinion of the majority becausein my opinion the labor union must know how to respect the sanctity of valid com-mitments. It is evident that the purpose of the strike is merely to avoid and circum-vent the agreement entered into by the company and the union on July 7, 1948, thelatter knowing fully well that said agreement was celebrated precisely in contemplationof the installation of the new machineries. That agreement received the sanction ofthe Court of Industrial Relations. It was still binding and in full force. If the moveof the union be tolerated, we would be allowing a subversion of a contract freelyentered into without any valid and justifiable reason. Such act cannot be sanctionedin law or in equity as it is in 'derogation of the principle underlying the freedom ofcontract and the good faith that should exist in contractual relations (Manila OrientalSawmill Co. '1'. National Laborer Union, et al., G. R. No. 4330)."

"A strike in violation of a collectivebargainingcontract is generally held unlawfuL"(TELLER,op. cit., pp. 254.258, Sec. 86).

12 In harmony with article 1702 of the Civil Code which states "In case of doubt,all labor legislations and all labor contracts shall be construed in favor of the safetyand decent living for the laborers."

13 "At any rate, we think that the fixing of wages should be subordinated to themore urgent and important matter of threshing out the question of granting two work·ing days to the laborers." Central Vegetable Oil Manufacturing Co., Inc. '1'. Philip-pine Oil Industry Workers Union, supra).

14 "Whether the strike is legal or illegal, the relation of employer and employeeis not terminated, though the strike interrupts the continuity of the employment andsimply suspends it." (Dee C. Chuan & Sons '1'. Kaisahan, CIR Nos. 71·V, 71-V(I),71-V(2), 71-V(4), July 23, 1948).

15 "In this connection, it may be mentioned that there is nothing in the 1l.greementof July 17, 1948, that may be interpreted as prohibiting the Union absolutely fromseekingmore working days or better conditions for the laborers. And such prohibitionwill be patently immoral if not illegaL" (Central Vegetable Oil Manufacturing Co.,Inc. '1'. Philippine Oil Industry Workers Union, supra).

The Company and the Union in the instant case had agreed thatin case of disagreement inthe fixing of the scales of wages, it wouldbe submitted to the Court of Industrial Relations for arbitration anddecision. This condition was prompted by the desire to avert theoccurrence of strikes. This precaution, however, did not prove suf-ficient. It seems that in the light of the present decision, it wouldbe easy for Labor to disown a valid and effective covenant. Whatincentive is there then for Management to enter into a labor con-tract, even if sanctioned by the Court of Industrial Relations?

It may happen, as it happened in this case, that the bargain willresult in a decrease of wages. Labor knows that the Company willenforce the agreement. The said agreement had been approved bythe Court of Industrial Relations, and no circumstance warrants amodification therein. The Court should therefore require compliancewith the agreement. Labor would be left with no alternative thenbut to declare a strike or else suffer the decrease. It would then bethe most effective way of accomplishing this end. But then the strikewill be declared illegal, being violative of a labor contract approvedby the Court of Industrial Relations as an award or decision. Thelaborers would not want to lose their jobs. Their dismissal becauseof having declared an illegal strike would be justified. Labor canescape this adverse consequence by going on a "legal" strike. Whatcould them from asserting that the strike is for a purpose entirelyforeign to the agreement. After all a demand for better workingconditions cannot be illegal, nor unjust or unreasonable merely be-cause the management cannot be made to grant it.

This will be the situation under the majority ruling in this caseunless the Court will look behind the apparent purpose of a striketo determine the real purpose. Otherwise, strike as a weapon ofLabor called strike may be used indiscriminately and variously. Thuswould the purpose in creating the Court of Industrial Relations asan arbitral agency be frustrated.

Statutory Construction-When Word "shall" Appearing in Stat-ute Considered as Mandatory or Director.

RAMON DIOKNO VS. REHABILITATION FINANCE CORPORATIONG.R. No. L-4712, Prom. July 11, 1952

The legislature has been likened toa musical composer whose"written notes are at best only an approximation to the composer'sintention" but must leave interpretation to others, principally to thecourts. Just as the musical composer delegates some subordinatecreative activity to musical performers, so, the legislature delegatessome subordinate (judicial) legislative-i.e., creative activity-to thecourts.1 Since the quality of legislative organization and procedure

1Frank, Words and Music: Some Remarks On Statutory Interpretation, 47 Co-lumbia Law Review 1259-1278 (1947). "The legislature cannot itself enforce the sta-tutes. It must delegate that task to other governmental agencies-to the executiveand