San Miguel sales union vs blas ople(NOTE ITO YUNG LATTER CASE)

Union filed a complaint of violation of CBA and notice of strike because the SM said it should sell beers in its office. It
violates the CBA because under the CBA the salesmen were the one who should sell in their respective territories. It
would reduce the takehome pay of the salesman

NLRC stated that didnt induce union disorganization. Also, SM provided for compensation
Issue: w/n the policy is a valid exercise of management preprogative
Held:it is a valid exercise of management prerogative to attain its goal to increase profit.

Except as limited by special laws, an employer is free to regulate, according to his own discretion and
judgment, all aspects of employment, including hiring, work assignments, working methods, time, place
and manner of work, tools to be used, processes to be followed, supervision of workers, working
regulations, transfer of employees, work supervision, lay-off of workers and the discipline, dismissal
and recall of work. ... (NLU vs. Insular La Yebana Co., 2 SCRA 924; Republic Savings Bank vs. CIR 21
SCRA 226, 235.) (Perfecto V. Hernandez, Labor Relations Law, 1985 Ed., p. 44.) (Emphasis ours.)
. The free will of management to conduct its own business affairs to achieve its purpose cannot be
denied.
So long as a company's management prerogatives are exercised in good faith for the advancement of the employer's
interest and not for the purpose of defeating or circumventing the rights of the employees under special laws or under
valid agreements, this Court will uphold them (LVN Pictures Workers vs. LVN, 35 SCRA 147; Phil. American
Embroideries vs. Embroidery and Garment Workers, 26 SCRA 634; Phil. Refining Co. vs. Garcia, 18 SCRA 110). San
Miguel Corporation's offer to compensate the members of its sales force who will be adversely affected by the
implementation of the CDS by paying them a so-called "back adjustment commission" to make up for the
commissions they might lose as a result of the CDS proves the company's good faith and lack of intention to bust
their union.
Halaguea v. PAL, G.R. No. 172013, October 2, 2009
PAL FASAP(representative of PAL employyees) moved for an injunction of implementation of
one rprovision in a CBA which states that females should retire at age 55 and males at 60. The
yaver that it is discreiminatory
RTC granted but CA held that RTC didnt gave any jurisdictiom

Held: 2
nd
step after determining if subject matter is condition (212 l)labor arbiter can only
decide on issues tht can only be resolved with reference to labor code, labor statues and the
CBA

This is because the consti and civil laws are not under the exclusive expertise of labor arbiters.

Impt words=no exclusive jurisdiction
Impt sentence= no exclisuve application of labor statutes= no exclusive jurisdiction
Dont need expertise
No deprivation of jurisdiction

__
The said issue cannot be resolved solely by applying the Labor Code. Rather, it requires the
application of the Constitution, labor statutes, law on contracts and the Convention on the
Elimination of All Forms of Discrimination Against Women,
[16]
and the power to apply and
interpret the constitution and CEDAW is within the jurisdiction of trial courts, a court of general
jurisdiction. In Georg Grotjahn GMBH & Co. v. I snani,
[17]
this Court held that not every dispute
between an employer and employee involves matters that only labor arbiters and the NLRC can
resolve in the exercise of their adjudicatory or quasi-judicial powers. The jurisdiction of labor
arbiters and the NLRC under Article 217 of the Labor Code is limited to disputes arising from an
employer-employee relationship which can only be resolved by reference to the Labor Code, other
labor statutes, or their collective bargaining agreement.

Not every controversy or money claim by an employee against the employer or vice-versa is
within the exclusive jurisdiction of the labor arbiter. Actions between employees and employer
where the employer-employee relationship is merely incidental and the cause of action precedes
from a different source of obligation is within the exclusive jurisdiction of the regular
court.
[18]
Here, the employer-employee relationship between the parties is merely incidental and the
cause of action ultimately arose from different sources of obligation, i.e., the Constitution and
CEDAW.

Thus, where the principal relief sought is to be resolved not by reference to the Labor Code
or other labor relations statute or a collective bargaining agreement but by the general civil law,
the jurisdiction over the dispute belongs to the regular courts of justice and not to the labor arbiter
and the NLRC. In such situations, resolution of the dispute requires expertise, not in labor
management relations nor in wage structures and other terms and conditions of employment, but
rather in the application of the general civil law. Clearly, such claims fall outside the area of
competence or expertise ordinarily ascribed to labor arbiters and the NLRC and the rationale for
granting jurisdiction over such claims to these agencies disappears.
[19]


They have no jurisdiction and competence to decide constitutional issues relative to the questioned
compulsory retirement age. Their exercise of jurisdiction is futile, as it is like vesting power to someone
who cannot wield it.


. But as expedient as this policy may be, it should not deprive the courts of justice of their power to
decide ordinary cases in accordance with the general laws that do not require any particularexpertise
or training to interpret and apply. Otherwise, the creeping take-over by the administrative agencies of
the judicial power vested in the courts would render the judiciary virtually impotent in the discharge of
the duties assigned to it by the Constitution.

G.R. No. 196539 October 10, 2012
Portillo vs Lietz Inc
Portillo was employed by Lietz with a goodwill clause(she shpuldnt be employed in a competitor 3 yrs after dismissal)
.should he violate,he would pay 12monts worth of salary. after he was dismissed, he was employed by a competitor.
Portillo filed a claim against lietz for unpaid salary. CA ruled that he is entitled to salary but iwas offset by the violation
of the goodwill clause.

FH: the relief sought springs from civil code or other non labor statute law, then RTC has jurisdiction
However it stated Neither can we uphold the reasoning of respondent court that because the resolution of the issues
presented by the complaint does not entail application of the Labor Code or other labor laws, the dispute is
intrinsically civil. Article 217(a) of the Labor Code, as amended, clearly bestows upon the Labor Arbiter original and
exclusive jurisdiction over claims for damages arising from employer-employee relationsin other words, the Labor
Arbiter has jurisdiction to award not only the reliefs provided by labor laws, but also damages governed by the Civil
Code.
27
(Emphasis supplied) so this is a qualification of the halaguera test

So ths claim must arise out of /or caused by (having causal relationship) employer mployee relationship and not
merely incidental
__
4. Claims for actual, moral, exemplary and other forms of damages arising from the employer-employee relations;
(Underscoring supplied)
Evidently, the Court of Appeals is convinced that the claim for liquidated damages emanates from the "Goodwill
Clause of the employment contract and, therefore, is a claim for damages arising from the employeremployee
relations."
Stated differently, petitioner seeks protection under the civil laws and claims no benefits under the Labor Code. The
primary relief sought is for liquidated damages for breach of a contractual obligation. The other items demanded are
not labor benefits demanded by workers generally taken cognizance of in labor disputes, such as payment of wages,
overtime compensation or separation pay. The items claimed are the natural consequences flowing from breach of an
obligation, intrinsically a civil dispute.
19
(Emphasis supplied)
While paragraph 3 above refers to "all money claims of workers," it is not necessary to suppose that the entire
universe of money claims that might be asserted by workers against their employers has been absorbed into the
original and exclusive jurisdiction of Labor Arbiters. In the first place, paragraph 3 should be read not in isolation from
but rather within the context formed by paragraph 1 (relating to unfair labor practices), paragraph 2 (relating to claims
concerning terms and conditions of employment), paragraph 4 (claims relating to household services, a particular
species of employer-employee relations), and paragraph 5 (relating to certain activities prohibited to employees or to
employers). It is evident that there is a unifying element which runs through paragraph 1 to 5 and that is, that they all
refer to cases or disputes arising out of or in connection with an employer-employee relationship. This is, in other
words, a situation where the rule of noscitur a sociis may be usefully invoked in clarifying the scope of paragraph 3,
and any other paragraph of Article 217 of the Labor Code, as amended. We reach the above conclusion from an
examination of the terms themselves of Article 217, as last amended by B.P. Blg. 227, and even though earlier versions
of Article 217 of the Labor Code expressly brought within the jurisdiction of the Labor Arbiters and the NLRC "cases
arising from employer-employee relations, [citation omitted]" which clause was not expressly carried over, in printer's
ink, in Article 217 as it exists today. For it cannot be presumed that money claims of workers which do not arise out of
or in connection with their employer-employee relationship, and which would therefore fall within the general
jurisdiction of regular courts of justice, were intended by the legislative authority to be taken away from the
jurisdiction of the courts and lodged with Labor Arbiters on an exclusive basis. The Court, therefore, believes and so
holds that the "money claims of workers" referred to in paragraph 3 of Article 217 embraces money claims which arise
out of or in connection with the employer-employee relationship, or some aspect or incident of such relationship. Put
a little differently, that money claims of workers which now fall within the original and exclusive jurisdiction of Labor
Arbiters are those money claims which have some reasonable causal connection with the employer-employee
relationship.
21
(Emphasis supplied)
We thereafter ruled that the "reasonable causal connection with the employer-employee relationship" is a requirement
not only in employees money claims against the employer but is, likewise, a condition when the claimant is the
employer.
It is clear, therefore, that while Portillos claim for unpaid salaries is a money claim that arises out of or in connection
with an employer-employee relationship, Lietz Inc.s claim against Portillo for violation of the goodwill clause is a
money claim based on an act done after the cessation of the employment relationship. And, while the jurisdiction over
Portillos claim is vested in the labor arbiter, the jurisdiction over Lietz Inc.s claim rests on the regular courts. Thus:
This is, of course, to distinguish from cases of actions for damages where the employer-employee relationship is
merely incidental and the cause of action proceeds from a different source of obligation. Thus, the jurisdiction of
regular courts was upheld where the damages, claimed for were based on tort[citation omitted], malicious
prosecution [citation omitted], or breach of contract, as when the claimant seeks to recover a debt from a former
employee [citation omitted] or seeks liquidated damages in enforcement of a prior employment contract. [citation omitted]
Neither can we uphold the reasoning of respondent court that because the resolution of the issues presented by the
complaint does not entail application of the Labor Code or other labor laws, the dispute is intrinsically civil. Article
217(a) of the Labor Code, as amended, clearly bestows upon the Labor Arbiter original and exclusive jurisdiction over
claims for damages arising from employer-employee relationsin other words, the Labor Arbiter has jurisdiction to
award not only the reliefs provided by labor laws, but also damages governed by the Civil Code.
27
(Emphasis supplied)
In the case at bar, the difference in the nature of the credits that one has against the other, conversely, the nature of
the debt one owes another, which difference in turn results in the difference of the forum where the different credits
can be enforced, prevents the application of compensation. Simply, the labor tribunal in an employees claim for
unpaid wages is without authority to allow the compensation of such claims against the post employment claim of the
former employer for breach of a post employment condition. The labor tribunal does not have jurisdiction over the civil
case of breach of contract.
When, as here, the cause of action is based on a quasi-delict or tort, which has no reasonable causal connection with
any of the claims provided for in Article 217, jurisdiction over the action is with the regular courts. [citation omitted]

Difftopic
The error of the appellate court in its Resolution of 14 October 2010 is basic. The original decision, the right ruling,
should not have been reconsidered.1wphi 1
Indeed, the application of compensation in this case is effectively barred by Article 113 of the Labor Code which
prohibits wage deductions except in three circumstances:
ART. 113. Wage Deduction. No employer, in his own behalf or in behalf of any person, shall make any deduction from
wages of his employees, except:
(a) In cases where the worker is insured with his consent by the employer, and the deduction is to recompense the
employer for the amount paid by him as premium on the insurance;
(b) For union dues, in cases where the right of the worker or his union to check-off has been recognized by the
employer or authorized in writing by the individual worker concerned; and
(c) In cases where the employer is authorized by law or regulations issued by the Secretary of Labor.
G.R. No. L-54334 January 22, 1986
Kiok loy vs NLRC
FF:
1.Kilusan was declared by the Bureau of Labor relations as the bargaining agent of Sweden ice cream employees
2. they submitted a Collective bargaining agreement proposal and asked Sweden ice cream to send their
counterproposal. Sweden Ice cream did not send any proposal.
3. they filed a notice of strike. Conciliatory proceedings were had but to no avail. Because of this, a case was filed with
the NLRC.
4. the presentation of evidence by Sweden Icecream were postponed 4 times due to various reasons (failure to file
position papers,withdrawal of their counsel,absence of witness etc.)
5.NLRC held that for failure to present evidence,the proposed CBA should be binding on both parties.
6.petitioner filed a petition for certiorari saying that they were not given due process and that there is no legal and
factual basis.
Issue:w/n the certiorari should be granted
Held:
There is unfair labor practice because the employer refused to negotiate in CBA. the agent and the employer are
mutually responsible to negotiate the terms of the CBA. It is an democratic framework to create industrial peace.
_
Collective bargaining which is defined as negotiations towards a collective agreement,
6
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. So much so that Article 249, par. (g) of the Labor Code makes it an unfair labor practice for an
employer to refuse "to meet and convene promptly and expeditiously in good faith for the purpose of negotiating an
agreement with respect to wages, hours of work, and all other terms and conditions of employment including proposals for
adjusting any grievance or question arising under such an agreement and executing a contract incorporating such
agreement, if requested by either party.
While it is a mutual obligation of the parties to bargain, the employer, however, is not under any legal duty to initiate
contract negotiation.
7
The mechanics of collective bargaining is set in motion only when the following jurisdictional
preconditions are present, namely, (1) possession of the status of majority representation of the employees' representative
in accordance with any of the means of selection or designation provided for by the Labor Code; (2) proof of majority
representation; and (3) a demand to bargain under Article 251, par. (a) of the New Labor Code . ... all of which preconditions
are undisputedly present in the instant case.
We are in total conformity with respondent NLRC's pronouncement that petitioner Company is GUILTY of unfair labor
practice. It has been indubitably established that (1) respondent Union was a duly certified bargaining agent; (2) it
made a definite request to 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.
8
A Company's
refusal to make counter proposal if considered in relation to the entire bargaining process, may indicate bad faith and this is
specially true where the Union's request for a counter proposal is left unanswered.
9
Even during the period of compulsory
arbitration before the NLRC, petitioner Company's approach and attitude-stalling the negotiation by a series of
postponements, non-appearance at the hearing conducted, and undue delay in submitting its financial statements, lead to
no other conclusion except that it is unwilling to negotiate and reach an agreement with the Union. Petitioner has not at any
instance, evinced good faith or willingness to discuss freely and fully the claims and demands set forth by the Union much
less justify its opposition thereto.
10

We agree with the pronouncement that it is not obligatory upon either side of a labor controversy to precipitately
accept or agree to the proposals of the other. But an erring party should not be tolerated and allowed with impunity to
resort to schemes feigning negotiations by going through empty gestures.
13
More so, as in the instant case, where the
intervention of the National Labor Relations Commission was properly sought for after conciliation efforts undertaken by the
BLR failed. The instant case being a certified one, it must be resolved by the NLRC pursuant to the mandate of P.D. 873, as
amended, which authorizes the said body to determine the reasonableness of the terms and conditions of employment
embodied in any Collective Bargaining Agreement. To that extent, utmost deference to its findings of reasonableness of any
Collective Bargaining Agreement as the governing agreement by the employees and management must be accorded due
respect by this Court.
G.R. No. L-48347 October 3, 1978
Ramon vs albano memorial
FF:Albano school. Albano school chapter(chapter) filed a certifiatin of election w/ BLR. Med arbiter held that it
shouldnt bee given due course cos the certification was without 30% consent. It was appealed w/ BLR. BLR held that
they didnt hav have consent and ordered the election for the union. Albano school appealed.
Issue: w/n the decision f the BLR was wrong
Held:no
Certification of election(voting a union to represent employees) is an democratic mean to achieve industrial peace
Hence,tama yug decision

the Bureau of Labor Relations, in the exercise of sound discretion, may order a certification election notwithstanding
the failure to meet the 30% requirement. Once that requisite is complied with, however, the Code makes, clear that "it
shall be mandatory for the Bureau to conduct a Identification election for the purpose of determining the
representative of the employees in the appropriate bargaining unit and certify the winner as the exclusive collective
bargaining representative of all the employees in the unit
--
The constitute ion of collective bargaining is. to recall Cox a prime manifestation of industrial democracy at, work. The two
parties to the relationship, tabor and management, make their own rules b coming to terms. That is to govern themselves in
matters that really, count. As labor, however, is composed of a number of individuals, it is indispensable that they be
represented by a labor organization of their choice. Thus may be discerned how crucial is a certification election. Xxx
. It is the fairest and most effective way of determining which labor organization can truly represent the working force. It is a
fundamental postulate that the will of the majority given expression in an honest election with freedom on the part of the
voters to make their choice, is controlling. No better device can assure the institution of industrial democracy with the two
parties to a business enterprise, management and labor, establishing a regime of self-rule.
7
That is to accord respect to the
policy of the Labor Code, indisputably partial to the holding of a certification election so as to arrive in a manner definit ive
and certain concerning the choice of the labor organization to represent the workers in a collective bargaining unit.
8

2. Conformably to the above basic concept, this Court, in the aforesaid Philippine Association of Free Labor Unions decision,
recognized that the Bureau of Labor Relations, in the exercise of sound discretion, may order a certification election
notwithstanding the failure to meet the 30% requirement. Once that requisite is complied with, however, the Code
makes, clear that "it shall be mandatory for the Bureau to conduct a Identification election for the purpose of
determining the representative of the employees in the appropriate bargaining unit and certify the winner as the
exclusive collective bargaining representative of all the employees in the unit."
9
Necessarily then, the argument of
petitioner as to the inability of private respondent to come up with the required signatures when the petition was first filed
falls to the ground.
PAL vs NLRC(under management prerogative)
1.PAL revised its Code of Discipline and implemented it. Because of this,certain employees were subjected to disciplinary
measures embodied therein.
2.Philippine airlines employees association(PALEA) filed a complaint for unfair labor practice with the NLRC alleging that there
was no prior discussion with the Union in making the code,no distribution to all the employees,and that it was oppressive. PAL
asked the NLRC to order PAL to reinstate the dismissed employees, declare PAL guilty of unfair labor practice, and order PAL
to discuss with PALEA the substance of the code.
PAL asserts that it is their management prerogative to implement the code.
The labor arbiter held that the code wasnt amply circulated. Hence, they ordered PALEA to discuss the substance of the code
with the union,furnish the code to all employees,and reconsider the dismissals.
It was appealed to the NLRC; the Commissioner held that there was no unfair labor practice but ordered PAL to include the
PALEA in the formulation of the code and to furnish the code to all employees.
PAL filed a petition for certiorari. They alleged the NLRC exceeded their jurisdiction when they ordered PAL to include PALEA
in formulating the code. PAL avers that it is their management prerogative to decide on the rules ans that when they made the
code there wasnt any law mandating the participation of employees in the decision making of their rights and duties.
Issue: whether management may be compelled to share with the union or its employees its prerogative of formulating a code of
discipline.
Held:
The exercise of management prerogative has its limits.Tt must be in good faith ,in furtherance of the employees interest,and
must not circumvent the rights of the employees. It is circumscribed by limitations found in law, a collective bargaining
agreement, or the general principles of fair play and justice.
The objectionable provisions herein are not purely business-oriented nor do they concern the management aspect of the
business of the company. a line must be drawn between management prerogatives regarding business operations per se and
those which affect the rights of the employees. In treating the latter, management should see to it that its employees are at least
properly informed of its decisions or modes action
even before Article 211 of the labor Code (P.D. 442) was amended by Republic Act No. 6715, it was already declared a policy
of the State, "(d) To promote the enlightenment of workers concerning their rights and obligations" This was, of course,
amplified by Republic Act No 6715 when it decreed the "participation of workers in decision and policy making processes
affecting their rights, duties and welfare." PAL's position that it cannot be saddled with the "obligation" of sharing management
prerogatives as during the formulation of the Code, Republic Act No. 6715 had not yet been enacted (Petitioner's Memorandum,
p. 44; Rollo, p. 212), cannot thus be sustained. While such "obligation" was not yet founded in law when the Code was
formulated, the attainment of a harmonious labor-management relationship and the then already existing state policy of
enlightening workers concerning their rights as employees demand no less than the observance of transparency in managerial
moves affecting employees' rights.
Anent the PALs assertion that the PALEA agreed that PAL can exclusively determine the rules and regulations as agreed in the
CBA, the court held that Such provision in the collective bargaining agreement may not be interpreted as cession of employees'
rights to participate in the deliberation of matters which may affect their rights and the formulation of policies relative thereto
Chu vs NLRC
FF:petitioner was employed under a special contract for a year to be the head of the the Warehousing, Sugar, Shipping
and Marine Departmen.
Under a memo, which rotated the personel he was ttransferred to be the head sugar sales department
He filed a petition alleging constructive dismissal. He said that employer was bound by the special contract that he should only
be the Warehousing, Sugar, Shipping and Marine Department HEAD. And the employer waived its prerogative.
Issue: can his position in the co. be changed?
Heldyes
It is the employers prerogative, based on its assessment and perception of its employees
qualifications, aptitudes, and competence to move them around in the various areas of its business
operations in order to ascertain where they will function with maximum benefit to the company. An
employees right to security of tenure does not give him such a vested right in his position as would
deprive the company of its prerogative to change his assignment or transfer him where he will be most
useful. When his transfer is not unreasonable, nor inconvenient, nor prejudicial to him, and it does not
involve a demotion in rank or a diminution of his salaries, benefits, and other privileges, the employee
may not complain that it amounts to a constructive dismissal.
--
An owner of a business enterprise is given considerable leeway in managing his business because it is deemed
important to society as a whole that he should succeed. Our law, therefore, recognizes certain rights as inherent in the
management of business enterprises. These rights are collectively called management prerogatives or acts by which
one directing a business is able to control the variables thereof so as to enhance the chances of making a profit.
"Together, they may be taken as the freedom to administer the affairs of a business enterprise such that the costs of
running it would be below the expected earnings or receipts. In short, the elbow room in the quest for profits"
(Fernandez and Quiason, The Law on Labor Relations, 1963 ed., p. 43).
One of the prerogatives of management, and a very important one at that, is the right to transfer employees in their
work station. In Philippine J apan Active Carbon Corporation v. National Labor Relations Commission, 171 SCRA 164
(1989), we held:
It is the employers prerogative, based on its assessment and perception of its employees
qualifications, aptitudes, and competence to move them around in the various areas of its business
operations in order to ascertain where they will function with maximum benefit to the company. An
employees right to security of tenure does not give him such a vested right in his position as would
deprive the company of its prerogative to change his assignment or transfer him where he will be most
useful. When his transfer is not unreasonable, nor inconvenient, nor prejudicial to him, and it does not
involve a demotion in rank or a diminution of his salaries, benefits, and other privileges, the employee
may not complain that it amounts to a constructive dismissal.
This is a function associated with the employers inherent right to control and manage effectively its enterprise. Even
as the law is solicitous

G.R. No. 87700 June 13, 1990
San Miguel corp employees vs bersamina
FF:San Miguel hired an independent contractor. The independent contractor workers wanted to be under the
Collective bargaining unit. It was denied so they together with the members of the CBU held a strike. San Miguel
motioned for an injunction with the RTC. It was granted. The independent contractors filed a case of certiorari saying
that it is solely within the jurisdiction of the labor arbiter because it is a labor dispute

Issue:w/n the issue is a labor dispute
HeldYes
No proximate relationship of employer ad employee is needed for it to be a labor dispute. All that is needed is that it is
a
A "labor dispute" as defined in Article 212 (1) of the Labor Code 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."
Challenging san migue lto better condition by making them regular employee. Hence it concerns terms and
conditions.
--
A "labor dispute" as defined in Article 212 (1) of the Labor Code 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."
While it is SanMig's submission that no employer-employee relationship exists between itself, on the one hand, and
the contractual workers of Lipercon and D'Rite on the other, a labor dispute can nevertheless exist "regardless of
whether the disputants stand in the proximate relationship of employer and employee" (Article 212 [1], Labor
Code,supra) provided the controversy concerns, among others, the terms and conditions of employment or a
"change" or "arrangement" thereof (ibid). Put differently, and as defined by law, the existence of a labor dispute is not
negative by the fact that the plaintiffs and defendants do not stand in the proximate relation of employer and
employee.
That a labor dispute, as defined by the law, does exist herein is evident. At bottom, what the Union seeks is to
regularize the status of the employees contracted by Lipercon and D'Rite in effect, that they be absorbed into the
working unit of SanMig. This matter definitely dwells on the working relationship between said employees vis-a-vis
SanMig. Terms, tenure and conditions of their employment and the arrangement of those terms are thus involved
bringing the matter within the purview of a labor dispute. Further, the Union also seeks to represent those workers,
who have signed up for Union membership, for the purpose of collective bargaining. SanMig, for its part, resists that
Union demand on the ground that there is no employer-employee relationship between it and those workers and
because the demand violates the terms of their CBA. Obvious then is that representation and association, for the
purpose of negotiating the conditions of employment are also involved. In fact, the injunction sought by SanMig was
precisely also to prevent such representation. Again, the matter of representation falls within the scope of a labor
dispute. Neither can it be denied that the controversy below is directly connected with the labor dispute already taken
cognizance of by the NCMB-DOLE (NCMB-NCR- NS-01- 021-89; NCMB NCR NS-01-093-83).
As the case is indisputably linked with a labor dispute, jurisdiction belongs to the labor tribunals. As explicitly
provided for in Article 217 of the Labor Code, prior to its amendment by R.A. No. 6715 on 21 March 1989, since the suit
below was instituted on 6 March 1989, Labor Arbiters have original and exclusive jurisdiction to hear and decide the
following cases involving all workers including "1. unfair labor practice cases; 2. those that workers may file involving
wages, hours of work and other terms and conditions of employment; ... and 5. cases arising from any violation of
Article 265 of this Code, including questions involving the legality of striker and lockouts. ..." Article 217 lays down the
plain command of the law.
The claim of SanMig that the action below is for damages under Articles 19, 20 and 21 of the Civil Code would not
suffice to keep the case within the jurisdictional boundaries of regular Courts. That claim for damages is interwoven
with a labor dispute existing between the parties and would have to be ventilated before the administrative machinery
established for the expeditious settlement of those disputes. To allow the action filed below to prosper would bring
about "split jurisdiction" which is obnoxious to the orderly administration of justice (Philippine Communications,
Electronics and Electricity Workers Federation vs. Hon. Nolasco, L-24984, 29 July 1968, 24 SCRA 321).
We recognize the proprietary right of SanMig to exercise an inherent management prerogative and its best business
judgment to determine whether it should contract out the performance of some of its work to independent contractors.
However, the rights of all workers to self-organization, collective bargaining and negotiations, and peaceful concerted
activities, including the right to strike in accordance with law (Section 3, Article XIII, 1987 Constitution) equally call for
recognition and protection. Those contending interests must be placed in proper perspective and equilibrium

Union of the Filipro Employees-Drug v. Nestle, G.R. No. 158930-31, August 22, 2006

Union filed a case against nestle for unfair labor practice because they wont include the retirement plan as an item
in the negotiations for the CBA. The NLRC held that it should be included but the CA held that it should be included
cos the retirement plan previously provided was a unilateral act.
Issue
Was there unfai labor practice
Should the item o retirement plan included in CBA?
Held: the agreement wasnt to take away the retirement plan out of the CBA but was to grant the negotiations of the
improvement of the retirement plan

Employers are accorded rights and privil eges to assure their self -determinati on and
independence and reasonabl e return of capi tal .
[ 63]
Thi s mass of privileges comprises the so-call ed
management prerogatives.
[ 64]
In thi s connection, the rul e i s that good fai th is always presumed.
As long as the companys exercise of the same is in good faith to advance i ts interest and not for
purpose of defeati ng or ci rcumventi ng the rights of empl oyees under the l aw or a valid
agreement, such exercise will be upheld.
[ 65]

They tried not to include the retirement plan in the negotiations but this is a management prerogative when absent
bad faith isnt unfair labor practice.


the inclusi on of the retirement plan i n the coll ecti ve bargaining agreement as
part of the package of economic benefi ts extended by the company to its employees to
provide them a measure of financi al securit y aft er t hey shal l have ceased to be emplo yed
in t he company, reward thei r loyalt y, boost thei r moral e and effi ci ency and promot e
industri al peace, gi ves a consensual character t o the pl an so that it may not be
terminated or modi fi ed at wil l by either party (cit ati on omitt ed).

The fact that the retirement pl an is non-contri butory, i. e. , that the employees
contribute nothing to the operation of the pl an, does not make it a non-issue in the
CBA negotiations. As a matter of fact, al most all of the benefi ts that the petitioner
has granted to i ts empl oyees under the CBA sal ary increases, ri ce allowances,
midyear bonuses, 13
t h
and 14
t h
month pay, seniori ty pay, medi cal and hospi talization
plans, heal th and dental services, vacation, sick & other l eaves with pay are non-
contributory benefi ts. Since the reti rement plan has been an integral part of the CBA
since 1972, the Uni ons demand t o increase the benefi ts due the employees under
said plan, is a vali d CBA issue. x x x

x x x x

x x x [E]mployees do have a vested and demandabl e right over existing benefi ts
voluntaril y granted to them by thei r empl oyer. The latter may not unilaterall y withdraw,
eliminate or dimini sh such benefi ts (Art. 100, Labor Code; other ci tati on omitted).
[Emphases supplied. ]
[ 42]


In the case at bar, it cannot be deni ed that the CBA that was about to expi re at that ti me
contained provisions respecting the Retirement Plan. As the l atter benefi t was already subject of
the existing CBA, the members of UFE-DFA-KMU were onl y exercising thei r prerogati ve to
bargain orrenegoti ate for the i mprovement of the terms of the Reti rement Plan just l ike they
would for all the other economi c, as well as non-economi c benefi ts previousl y enjoyed by them.
Precisely, the purpose of coll ective bargaining is the acquisi ti on or attainment of the best
possibl e covenants or terms relating to economic and non-economi c benefi ts granted by
empl oyers and due the employees. The Labor Code has actually i mposed as a mutual obligation
of both parti es, thi s duty to bargain col lecti vel y. The duty to bargain coll ectively is categori cal ly
prescribed by Arti cle 252 of the said code. It states:


As regards the scope of the assumpti on powers of the Secretary of the DOLE, the appel late
court ruled that Sec. Sto. Tomas assumpti on of jurisdi cti on powers should have been li mited to
the disagreement on the ground rules of the coll ecti ve bargaining nego tiati ons. The Court of
Appeals referred to the minutes of the meeting held on 30 October 2001. That the
representative Nestl was recorded to have stated that we are still discussing ground rul es and
not yet on the CBA negotiati ons proper, a deadlock cannot be declared,
[ 45]
was a telling fact. The
Court of Appeal s, thus, declared that the Secretary shoul d not have rul ed on the questions and
issues rel ative to the substantive aspect of the CBA si mpl y because there was no confli ct on the
CBA yet.
[ 46]


. As held in the case of I nternati onal Pharmaceutical s, I nc. v. Sec. of Labor and
Employment,
[50]
x x x [t]he Secretary was expli ci tly granted by Article 263 (g) of the Labor Code
the authority to assume jurisdiction over a labor dispute causing or likely to cause a strike or
lockout in an industry indispensabl e to the national interest, and decide the same accordingl y.
Necessari ly, this authority to assume j urisdi ction over the said l abor dispute must include and
extend to all questi ons and controversi es arising therefrom, i ncluding cases over which the Labor
Arbi ter has exclusi ve jurisdi ction.
[ 51]
Accordingly, even if not exactly on the ground upon whi ch
the Noti ce of Strike is based, the fact that the i ssue is inci dental to the resolution of the subject
labor dispute or that a specifi c i ssue had been submitte d to the Secretary of the DOLE for her
resolution, validly empowers the l atter to take cognizance of and resolve the same.


ART. 247. CONCEPT OF UNF AI R LABOR PRACTI CE AND PROCEDURE F OR
PROSECUTI ON THEREOF . Unfai r l abor practi ces violat e the constit utional right of
workers and employees to self -organizat ion, are ini mical to the l egitimat e i nt erests of
both labor and management , i ncludi ng their ri ght t o bargain coll ectivel y and ot herwise
deal with each ot her in an atmosphere of freedom and mutu al respect, disrupt i ndustri al
peace and hinder t he promoti on of healthy and st abl e l abor -management rel ations.

x x x x.



ART. 248. UNF AI R LABOR PRACTI CES OF EMPLOYERS. It shall be
unl awful for an empl oyer t o commit any of the following unfai r l a bor practi ces:



(g) To viol ate the duty to bargain coll ecti vely as prescribed by this Code;



Herein, Nestl i s accused of viol ati ng its dut y t o bargain col lecti vel y when it purport edl y
imposed a pre-condi tion t o its agreement to di scuss and engage i n coll ective bargaini ng negoti ati ons
with UFE-DFA-KMU.




Except for the asserti on put forth by UFE-DFA-KMU, neither the second Notice of Strike
nor the records of these cases substantiate a finding of unfair labor practice. It is not enou gh
that the union beli eved that the empl oyer commi tted acts of unfai r labor practi ce when the
ci rcumstances clearly negate even a prima facie showing to warrant such a beli ef.
[ 58]
In i ts
letter
[ 59]
to UFE-DFA-KMU of 29 May 2001, though Nestl underscored i ts positi on
that unilateral grants, one-time company grants, company-initiated pol ici es and programs, whi ch
include, but are not limited to the Reti rement Plan, I ncidental Strai ght Duty Pay and Calling Pay
Premium, are by their very nature not proper subj ects of CBA negotiations and therefore shall be
excluded therefrom, such atti tude is not tantamount to refusal to bargain. This is especiall y true
when it is vi ewed i n the li ght of the fact that eight out of nine bargaining units have al legedl y
agreed to treat the Reti rement Plan as a unilateral grant. Nestl , therefore, cannot be faul ted for
considering the same benefit as unil aterally granted. To be sure, i t must be shown that Nestl
was motivated by il l will, bad fai th, or fraud, or was oppressive to l abor, or done in a manner
contrary to moral s, good customs, or public poli cy, and, of course, that soci al humiliation,
wounded feelings, or grave anxiety resulted x x x
[ 60]
in di sclai ming unilateral grants as proper
subjects in thei r col lecti ve bargaining negotiati ons.


Employers are accorded rights and privil eges to assure their self -determinati on and
independence and reasonabl e return of capi tal .
[ 63]
Thi s mass of privileges comprises the so-call ed
management prerogatives.
[ 64]
In thi s connection, the rul e i s that good fai th is always presumed.
As long as the companys exercise of the same is in good faith to advance i ts interest and not for
purpose of defeati ng or ci rcumventi ng the rights of empl oyees under the l aw or a valid
agreement, such exercise will be upheld.
[ 65]



SHS Perforated Materials, Inc. v. Diaz, 633 SCRA 258 (2010);
Hartmanshen the president employed diaz. Harmanshenn was always in gernamy. Diaz
performance was unsatisfactory.hermanshen said that diaz only went to work 8 times. When
he returned back diaz wanted his salary but harmanshen didnt want to give it back unless
diaz give him a reason why he was absent almost always. Diaz filed a case of constrictive
illegal dismissal bcos of withholding salary.
NLRC favored diaz. CA reversed citing that withholding the payment was a management
prerogative because diaz was always absent. CA reversed RTC said that there was illegal
constructive dismissal and no management prerog was exercised.
Issue: w/n there was constructive illegal dismissal which is dependent on
w/n there was exercise of management prerog
w/n there was resignation
withholding deduction based on absence isnt a manage prerog because to do so would
contravene the rule on the exception on manage prerog

-
Management prerogative refers to the right of an employer to regulate all aspects of
employment, such as the freedom to prescribe work assignments, working methods, processes to be
followed, regulation regarding transfer of employees, supervision of their work, lay-off and
discipline, and dismissal and recall of work.
[12]
Although management prerogative refers to the
right to regulate all aspects of employment, it cannot be understood to include the right to
temporarily withhold salary/wages without the consent of the employee. To sanction such an
interpretation would be contrary to Article 116 of the Labor Code, which provides:

ART. 116. Withholding of wages and kickbacks prohibited. It shall be unlawful for
any person, directly or indirectly, to withhold any amount from the wages of a
worker or induce him to give up any part of his wages by force, stealth, intimidation,
threat or by any other means whatsoever without the workers consent.


Any withholding of an employees wages by an employer may only be allowed in the form of
wage deductions under the circumstances provided in Article 113 of the Labor Code, as set forth
below:

Supreme steel vs supreme union
G.R. No. 185556 March 28, 2011
FF: petitioners hirer temporary contract workers to keep up with the demand of work needed. Union said petitioner
violated the CBA which states that they wouldnt hire contract workers. Petitioner said it was an exercise of
management prerog
H:management prerog isnt absolute. It is limited by ,among others, theCBA
(see bold text)
Indeed, jurisprudence recognizes the right to exercise management prerogative. Labor laws also discourage
interference with an employer's judgment in the conduct of its business. For this reason, the Court often declines to
interfere in legitimate business decisions of employers. The law must protect not only the welfare of employees, but
also the right of employers.
63
However, the exercise of management prerogative is not unlimited. Managerial
prerogatives are subject to limitations provided by law, collective bargaining agreements, and general principles of fair
play and justice.
64
The CBA is the norm of conduct between the parties and, as previously stated, compliance
therewith is mandated by the express policy of the law.
65

The CBA is clear in providing that temporary employees will no longer be allowed in the company except in the
Warehouse and Packing Section. Petitioner is bound by this provision. It cannot exempt itself from compliance by
invoking management prerogative. Management prerogative must take a backseat when faced with a CBA provision. If
petitioner needed additional personnel to meet the increase in demand, it could have taken measures without violating
the CBA.
PLDT v. Paguio, G.R. No. 152689, October 12, 2005
Paguio was very active in voicing out his concern in the way how PLDT rated the performance
of exchange,rebalancing of the man power. Because of this, paguio believes that he was
reassigned as Head for Special Assignment at the Office of the GMM East Center and asked to turn over
his functions as Garnet Exchange Head. PLDT claimed that it was an exercise of management
prerogative to change the position of its employees as long as it isnt done in bad faith and no demotion
of rank and salary. Paguio claims that it was a demotion beause he doesnt have an office and staff.

H: By its very nature, management prerogative must be exercised always with the principles
of fair play and justice.
[14]
In particular, the employer must be able to show that the transfer is not
unreasonable, inconvenient or prejudicial to the employee; nor does it involve a demotion in rank
or a diminution of his salaries, privileges and other benefits.
[15]
The employer bears the burden of
proving that the transfer of the employee has complied with the foregoing test
Here, there was no other reason why paguio was transferred other than beause of his
criticisms against PLDT
Now, on the crux of the matter, jurisprudence abounds that, except as limited by special
laws, an employer is free to regulate, according to his own discretion and judgment, all aspects of
employment, including the transfer of employees.
[12]
It is the employers prerogative, based on its
assessment and perception of its employees qualifications, aptitudes, and competence, to deploy its
employees in the various areas of its business operations in order to ascertain where they will
function with maximum benefit to the company. An employees right to security of tenure does not
give him such a vested right in his position as would deprive the company of its prerogative to
change his assignment or transfer him where he will be most useful.
[13]

Nonetheless, as correctly pointed out by the Court of Appeals, there are limits to the management
prerogative. While it may be conceded that management is in the best position to know its operational
needs, the exercise of management prerogative cannot be utilized to circumvent the law and public policy
on labor and social justice. That prerogative accorded management should not defeat the very purpose
for which our labor laws exist: to balance the conflicting interests of labor and management. By its very
nature, management prerogative must be exercised always with the principles of fair play and
justice.
[14]
In particular, the employer must be able to show that the transfer is not unreasonable,
inconvenient or prejudicial to the employee; nor does it involve a demotion in rank or a diminution
of his salaries, privileges and other benefits.
[15]
The employer bears the burden of proving that the
transfer of the employee has complied with the foregoing test.
[16]

In the present case, we see no credible reason for Paguios transfer except his criticisms of
the companys performance evaluation methods. Based on the undisputed facts, Garnet Exchange
was doing well and excelled in the performance rating. In the same way, Paguios performance
was consistently rated as outstanding. There was also no proof that Paguio refused to comply with
any management policy. Patently, his transfer could not be due to poor performance. Neither was
it because he was needed in the new post for the new assignment was functionless and it was
nothing but a title. Paguios transfer could only be caused by the managements negative reception
of his comments. It is prejudicial to Paguio because it left him out for a possible promotion as he
was assigned to a functionless position with neither office nor staff.


G.R. No. 103575. April 5, 1993.
BSSI had a retrenchment. Fired some employees. Paid of monthly salary per year. Years later, they closed. Paid
separation benefits of 1 monthly salary per year. The retrenched employees field a case saying that they wre
discriminated.
Held:see bold

Clearly, there was impermissible discrimination against the private respondents in the payment of their separation
benefits. The law requires an employer to extend equal treatment to its employees. It may not, in the guise of
exercising management prerogatives, grant greater benefits to some and less to others. Management prerogatives are
not absolute prerogatives but are subject to legal limits, collective bargaining agreements, or general principles of fair
play and justice (UST vs. NLRC, 190 SCRA 758). Article 283 of the Labor Code, as amended, protects workers whose
employment is terminated because of closure of the establishment or reduction of personnel (Abella vs. NLRC, 152
SCRA 141, 145).
With regard to the private respondents' claim for the mid-year bonus, it is settled doctrine that the grant of a bonus is a
prerogative, not an obligation, of the employer (Traders Royal Bank vs. NLRC, 189 SCRA 274). The matter of giving a
bonus over and above the worker's lawful salaries and allowances is entirely dependent on the financial capability of
the employer to give it. The fact that the company's business was no longer profitable (it was in fact moribund) plus
the fact that the private respondents did not work up to the middle of the year (they were discharged in May 1988) were
valid reasons for not granting them a mid-year bonus. Requiring the company to pay a mid-year bonus to them also
would in effect penalize the company for its generosity to those workers who remained with the company till the end"
of its days. (Traders Royal Bank vs. NLRC, supra.) The award must therefore be deleted.