COMPILATION OF CASES IN LABOR LAWS 2

MIDTERMS-FINALS

Submitted by: 2 JD
Submitted to: Labor Arbiter Malcolm Bacuso
 PART I
MIDTERMS

Basic principles: Creation, Powers and Jurisdiction of the NLRC

GIL CAPILI and RICARDO CAPILI v NRLC, et al. 270 SCRA 488 - ALDEN

FACTS: The (8) respondents are licensed drivers of public utility jeepneys plying the Libertad-
Sta. Cruz route in Manila. The jeepneys were formerly owned by petitioner Gil Capili.

On 7 May 1991, petitioner Ricardo Capili jointly with his wife had assumed ownership and
operation of the jeepneys driven by private respondents, the latter and the other drivers similarly
situated were required by the jeepney operators to sign individually contracts of lease of the
jeepneys to formalize their lessor-lessee relationship.
Having gathered the impression that the signing of the contracts of lease was a condition precedent
before they could continue driving for petitioners, all the drivers stopped plying their assigned
routes beginning 7 May 1991.

The drivers (22 total) filed a complaint for illegal dismissal before the Labor Arbiter praying for
separation pay. However, 14 of the complainants desisted and resumed their routes while the
remaining 8 refused to return to work.

Petitioners claimed that the 8 drivers voluntarily abandoned their respective jobs without any valid
cause and thereafter refused and still continue to refuse to return to work despite repeated demand
and/or notices given to them to to return to work.

The Labor Arbiter, affirmed by the NLRC, ruled that the issue was a simple case of
misunderstanding only. However, NLRC modified the LA’s decision by granting separation pay
to the drivers. Being the case, petitioners impute grave abuse of discretion on the part of respondent
NLRC in awarding separation pay to private respondents.

ISSUE: Whether the drivers are entitled to be awarded with separation pay.

HELD: Under Arts. 283 and 284 of the same Code, separation pay is authorized only in cases of
dismissals due to any of these reasons:
1.installation of labor saving devices;
2.redundancy;
3.retrenchment;
4.cessation of the employer's business, and,
5.when the employee is suffering from a disease and his continued employment is prohibited by
law or is prejudicial to his health and to the health of his co-employees.
However, separation pay shall be allowed as a measure of social justice in those cases where the
employee is validly dismissed for causes other than serious misconduct or those reflecting on his
moral character, but only when he was illegally dismissed.
In the instant case there was no dismissal at all. There was only a misunderstanding between
petitioners and private respondents which caused the latter to stop reporting for work. If the Labor
Arbiter ordered reinstatement it should not be construed as relief proceeding from illegal dismissal;
instead, it should be considered as a declaration or affirmation that private respondents may return
to work because they were not dismissed in the first place.
When there is no illegal dismissal, even if the relations are strained, separation pay has no legal
basis. Besides, the doctrine on "strained relations" cannot be applied indiscriminately since every
labor dispute almost invariably results in "strained relations;" otherwise, reinstatement can never
be possible simply because some hostility is engendered between the parties as a result of their
disagreement

PHILACOR VS LAGUESMA- APOLONIO

Facts: The Genuine Organization of Workers in Hotel, Restaurant and Allied Industries
(GLOWHRAIN) filed with the Department of Labor and Employment (DOLE) a petition for
certification election among the supervisory employees of Philacor. However, this was opposed
by the latter, asserting that the questioned employees are managerial employees exercising
managerial powers, functions and prerogatives whose decisions were instantly effective and not
merely recommendatory, and further asserted, that the alleged issue of whether petitioning
employees are managerial employees constituted a prejudicial question, which should be resolved
before any further proceedings could continue.
Eventually, the concerned Med-Arbiter issued an order directing the holding of a certification
election among the supervisory employees of Philacor.

Philacor filed a Motion to exclude the questioned employees before the Office of the SOLE. Sec.
Laguesma affirmed the Mid-Arbiter’s decision.

Subsequently, Philacor’s Motion for Reconsideration modified SOLE’s decision by finding that
the employees occupying the job titles of “Production Supervisor,” “Superintendent Production”
and “Production Manager” are managerial employees imbued with managerial prerogatives, and
therefore are ineligible to participate in the certification election among the supervisory employees.
Consequently, the GLOWHRAIN filed a motion for reconsideration, which challenged the
authenticity of the job descriptions submitted by Philacor, alleging that the same are irregular
having been issued only for the purpose of buttressing petitioner’s motion for reconsideration,
which was granted by Sec. Laguesma. Thus, the filing of Philacor’s Petition.

Issue: Whether the petitioning employees are supervisory employees eligible to form a supervisory
union.

Held: Yes. Secretary Laguesma is correct in its findings that the questioned employees are
supervisory employees and are eligible to form a supervisory union.
The Labor Code was further amended by Republic Act No. 6715. Section 4 of the said Republic
Act, amended Article 212 (m), which now contains separate definitions for managerial and
supervisory employees, to wit: “(m) Managerial employee is one who is vested with powers or
prerogatives to lay down and execute management policies and/or to hire, transfer, suspend, lay-
off, recall, discharge, assign or discipline employees. Supervisory employees are those who, in the
interest of the employer, effectively recommend such managerial actions if the exercise of such
authority is not merely routinary or clerical in nature but requires the use of independent judgment.
(Underscoring supplied).”

No evidence was presented by Philacor to bolster its claim that petitioning employees exercised
the power to shorten employees’ probationary period and the power to change the status of or
dismiss a casual employee.

As to the power to discipline, suspend and discharge employees, the SC finds that the petitioning
employees merely enforce the company rules and regulations against erring employees. But they
are not the one who conducts investigation and imposes penalty.
They do not lay down and execute management policies nor have the power to hire, but merely
recommend such management actions.
PHILACOR belatedly presented the job descriptions of the Production Supervisor, Superintendent
(Production) and Manager (Production) to show that indeed petitioning employees are exercising
managerial powers and prerogatives

MANGGAGAWA NG M. GREENFIELD vs RAMOS

326 SCRA 441 - Bautista

FACTS:Due to alleged illegal dismissals which were orchestrated by the respondent company M.
Greenfield, Inc (MGI) and respondent workers federation ULGWP, an illegal dismissal case was
filed against them by the union MGMW, which Labor Arbiter Ramos dismissed on the ground that
their termination was valid pursuant to their CBA. It was appealed to the NLRC, and the NLRC
First Division upheld the decision.
Petitioners are now questioning the decision’s validity.

They contended that the decision rendered by the First Division of the NLRC is not valid because
Commissioner Tanodra, who is from the Third Division, did not have any lawful authority to sit,
much less write the ponencia, on a case pending before the First Division. It is claimed that a
commissioner from one division of the NLRC cannot be assigned or temporarily designated to
another division because each division is assigned a particular territorial jurisdiction. Thus, the
decision rendered did not have any legal effect at all for being irregularly issued

ISSUE: Was the decision invalid on ground of lack of jurisdiction since one of the sitting members
of the first division of the NLRC was actually from the third division?

HELD: Petitioners argument is misplaced. Article 213 of the Labor Code in enumerating the
powers of the Chairman of the National Labor Relations Commission provides that:
"The concurrence of two (2) Commissioners of a division shall be necessary for the
pronouncement of a judgment or resolution. Whenever the required membership in a division is
not complete and the concurrence of two (2) commissioners to arrive at a judgment or resolution
cannot be obtained, the Chairman shall designate such number of additional Commissioners from
the other divisions as may be necessary."
During the pendency of the case in the First Division of the NLRC, one of the three commissioners,
retired, leaving Chairman Bartolome Carale and Commissioner Vicente Veloso III. Subsequently,
Commissioner Veloso inhibited himself from the case because the counsel for the petitioners was
his former classmate in law school. The First Division was thus left with only one commissioner.
Since the law requires the concurrence of two commisioners to arrive at a judgment or resolution,
the Commission was constrained to temporarily designate a commissioner from another division
to complete the First Division.
The law does not say that a commissioner from the first division cannot be temporarily assigned
to the second or third division to fill the gap or vice versa. The territorial divisions do not confer
exclusive jurisdiction to each division and are merely designed for administrative efficiency.
Hence, the judgment was valid.

G.R. No. 89621 September 24, 199

PEPSI COLA DISTRIBUTORS OF THE PHILIPPINES, INC., represented by its Plant
General Manager ANTHONY B. SIAN, ELEAZAR LIMBAB, IRENEO BALTAZAR &
JORGE HERAYA,petitioners, vs. HON. LOLITA O. GAL-LANG, SALVADOR
NOVILLA, ALEJANDRO OLIVA, WILFREDO CABAÑAS & FULGENCIO LEGO,
respondents. – CABIGTING

FACTS:
1. The private respondents were employees of the petitioner who were suspected of complicity in
the irregular disposition of empty Pepsi Cola bottles.
2. On July 16, 1987, the PEPSI COLA DISTRIBUTORS OF THE PHILIPPINES, INC., filed a
criminal complaint for theft against them but this was later withdrawn and substituted with a
criminal complaint for falsification of private documents.
3. November 23, 1987 after an administrative investigation, the private respondents were
dismissed by the PEPSI COLA DISTRIBUTORS OF THE PHILIPPINES, INC.,
4. On November 26, 1987, the Municipal Trial Court of Tanauan, Leyte, dismissed the complaint.
5. As a result, they filed a complaint for illegal dismissal with the Regional Arbitration Branch of
the NLRC in Tacloban City on December 1, 1987.
In addition, they instituted in the Regional Trial Court of Leyte, on April 4, 1988, a separate civil
complaint against the PEPSI COLA DISTRIBUTORS OF THE PHILIPPINES, INC., for damages
arising from what they claimed to be their malicious prosecution.
6. The PEPSI COLA DISTRIBUTORS OF THE PHILIPPINES, INC., moved to dismiss the civil
complaint on the ground that the trial court had no jurisdiction over the case because it involved
employee-employer relations that were exclusively cognizable by the labor arbiter.

HELD:
It must be stressed that not every controversy involving workers and their employers can be
resolved only by the labor arbiters. This will be so only if there is a "reasonable causal connection"
between the claim asserted and employee-employer relations. Absent such a link, the complaint
will be cognizable by the regular courts of justice in the exercise of their civil and criminal
jurisdiction.
This case involves a complaint for damages for malicious prosecution which was filed with the
Regional Trial Court of Leyte by the employees of the defendant company. It does not appear that
there is a "reasonable causal connection" between the complaint and the relations of the parties as
employer and employees. The complaint did not arise from such relations and in fact could have
arisen independently of an employment relationship between the parties.

PAUL V. SANTIAGO, petitioner, vs. CF SHARP CREW MANAGEMENT, INC.,

respondent. – CARLOS

FACTS: Petitioner had been working as a seafarer for Smith Bell Management, Inc. (respondent)
for about 5 yrs. In February 3, 1998, petitioner signed a new contract of employment with
respondent, with the duration of 9 months. The contract was approved by POEA. Petitioner was
to be deployed on board the “MSV Seaspread” which was scheduled to leave the port of Manila
for Canada on 13 February 1998.

A week before the date of departure, Capt. Pacifico Fernandez, respondent’s Vice President, sent
a facsimile message to the captain of “MSV Seaspread,”, saying that it received a phone call from
Santiago’s wife and some other callers who did not reveal their identity and gave him some
feedbacks that Paul Santiago this time, if allowed to depart, will jump ship in Canada like his
brother Christopher Santiago. The captain of “MSV Seaspread replied that it cancel plans for
Santiago to return to Seaspread.

Petitioner thus told that he would not be leaving for Canada anymore. Petitioner filed a complaint
for illegal dismissal, damages, and attorney’s fees against respondent and its foreign principal,
Cable and Wireless (Marine) Ltd. The Labor Arbiter (LA) favored petitioner and ruled that the
employment contract remained valid but had not commenced since petitioner was not deployed
and that respondent violated the rules and regulations governing overseas employment when it did
not deploy petitioner, causing petitioner to suffer actual damages. On appeal by respondent, NLRC
ruled that there is no employer-employee relationship between petitioner and respondent because
the employment contract shall commence upon actual departure of the seafarer from the airport or
seaport at the point of hire and with a POEA-approved contract. In the absence of an employer-
employee relationship between the parties, the claims for illegal dismissal, actual damages, and
attorney’s fees should be dismissed. But the NLRC found respondent’s decision not to deploy
petitioner to be a valid exercise of its management prerogative. Petitioner filed MR but it was
denied. He went to CA. CA affirmed the decision of NLRC. Petitioner’s MR was denied. Hence
this case.

ISSUE:
1. Whether there is a employer-employee relationship
2. Whether the NLRC has Jurisdiction over the case at bar

RULING: There is some merit in the petition. The parties entered into an employment contract
whereby petitioner was contracted by respondent to render services on board “MSV Seaspread”
for the consideration of US$515.00 per month for 9 months, plus overtime pay. However,
respondent failed to deploy petitioner from the port of Manila to Canada. Considering that
petitioner was not able to depart from the airport or seaport in the point of hire, the employment
contract did not commence, and no employer-employee relationship was created between the
parties. However, a distinction must be made between the perfection of the employment contract
and the commencement of the employer-employee relationship. The perfection of the contract,
which in this case coincided with the date of execution thereof, occurred when petitioner and
respondent agreed on the object and the cause, as well as the rest of the terms and conditions
therein. The commencement of the employer-employee relationship would have taken place had
petitioner been actually deployed from the point of hire. Thus, even before the start of any
employer-employee relationship, contemporaneous with the perfection of the employment
contract was the birth of certain rights and obligations, the breach of which may give rise to a cause
of action against the erring party. Thus, if the reverse had happened, that is the seafarer failed or
refused to be deployed as agreed upon, he would be liable for damages.

Neither the manning agent nor the employer can simply prevent a seafarer from being deployed
without a valid reason. Respondent’s act of preventing petitioner from departing the port of Manila
and boarding “MSV Seaspread” constitutes a breach of contract, giving rise to petitioner’s cause
of action. Respondent unilaterally and unreasonably reneged on its obligation to deploy petitioner
and must therefore answer for the actual damages he suffered.

Despite the absence of an employer-employee relationship between petitioner and respondent, the
Court rules that the NLRC has jurisdiction over petitioner’s complaint. The jurisdiction of labor
arbiters is not limited to claims arising from employer-employee relationships. Section 10 of R.A.
No. 8042

Since the present petition involves the employment contract entered into by petitioner for overseas
employment, his claims are cognizable by the labor arbiters of the NLRC.

Respondent is liable to pay petitioner only the actual damages in the form of the loss of nine (9)
months’ worth of salary as provided in the contract. He is not, however, entitled to overtime pay.
While the contract indicated a fixed overtime pay, it is not a guarantee that he would receive said
amount regardless of whether or not he rendered overtime work. Even though petitioner was
prevented without valid reason from rendering regular much less overtime service, the fact remains
that there is no certainty that petitioner will perform overtime work had he been allowed to board
the vessel. The amount stipulated in the contract will be paid only if and when the employee
rendered overtime work. Realistically speaking, a seaman, by the very nature of his job, stays on
board a ship or vessel beyond the regular eight-hour work schedule. For the employer to give him
overtime pay for the extra hours when he might be sleeping or attending to his personal chores or
even just lulling away his time would be extremely unfair and unreasonable.

Seafarers are considered contractual employees and cannot be considered as regular employees
under the Labor Code. Their employment is governed by the contracts they sign every time they
are rehired and their employment is terminated when the contract expires. The exigencies of their
work necessitates that they be employed on a contractual basis.
ATLAS FARMS v. NLRC- DONATO
FACTS: Jaime O. dela Pea was employed as a veterinary aide by Atlas Farms in December 1975.
He was among several employees terminated in July 1989.
On July 8, 1989, he was re-hired by petitioner and given the additional job of feedmill operator.
He was instructed to train selected workers to operate the feedmill. On March 13, 1993, Pea was
allegedly caught urinating and defecating on company premises not intended for the purpose. The
farm manager issued a formal notice directing him to explain within 24 hours why disciplinary
action should not be taken against him for violating company rules and regulations.

Pea refused, however, to receive the formal notice. He never bothered to explain, either verbally
or in writing, according to petitioner. Thus, on March 20, 1993, a notice of termination with
payment of his monetary benefits was sent to him. He duly acknowledged receipt of his separation
pay of P13,918.67.
Abion, carpenter/mason and maintenance man, was dismissed also for not complying with orders
after having clogged fishpond drainage. Petitioner sent a written notice to Abion, requiring him to
explain what happened, otherwise, disciplinary action would be taken against him. He refused to
receive the notice and give an explanation, according to petitioner. Consequently, the company
terminated his services on October 27, 1992. He acknowledged receipt of a written notice of
dismissal, with his separation pay.

Pea and Abion filed separate complaints for illegal dismissal that were later consolidated. Both
claimed that their termination from service was due to petitioners suspicion that they were the
leaders in a plan to form a union to compete and replace the existing management-dominated
union.

On November 9, 1993, LA dismissed their complaints on the ground that the grievance machinery
in the CBA had not yet been exhausted. They then availed of the grievance process, but later on
re-filed the case before the NLRC, and alleged "lack of sympathy" on Atlas’s part to engage in
conciliation proceedings.

Atlas filed a motion to dismiss, on the ground of lack of jurisdiction, alleging Dela Peña and Abion
themselves admitted that they were members of the employees’ union with which Atlas had an
existing CBA with. According to Atlas, jurisdiction over the case belonged to the grievance
machinery and thereafter the voluntary arbitrator, as provided in the CBA.
LA dismissed the complaint for lack of merit, finding that the case was one of illegal dismissal
and did not involve the interpretation or implementation of any CBA provision. He stated that
Article 217(c) of LCP was inapplicable to the case.

NLRC reversed the labor arbiter’s decision.

Atlas went to the CA by way of a petition for review on certiorari under Rule 65, seeking
reinstatement of the labor arbiter’s decision; but such was denied.

ISSUES:
1. Whether the two employees were illegally dismissed? YES
2. Whether LA and NLRC has jurisdiction over the cases? YES
HELD: Court ruled in favor of the respondents, affirming CA’s decision.
Yes. The burden of proving that the dismissal of Dela Peña and Abion was legal and valid falls
upon Atlas. Atlas failed to substantiate its claim that both Dela Peña and Abion violated Atlas’
rules and regulations; hence, there is no factual basis to say that their dismissal was in order. Court
saw no compelling reason to deviate from NLRC ruling finding the dismissals illegal, absent a
showing that it reached its conclusion arbitrarily.
Yes, there was no error in upholding the jurisdiction of LA and NLRC. Art 217 (224) of LCP
provides that labor arbiters have original and exclusive jurisdiction over termination disputes. A
possible exception is provided in Article 261 (274), wherein cases involve unresolved grievances
arising from the interpretation or implementation of the CBA and those arising from the
interpretation or enforcement of Atlas personnel policies.

Pursuant to Art 260 (273) of LCP, the parties to a CBA shall name or designate their respective
representatives to the grievance machinery and if the grievance is unsettled in that level, it shall
automatically be referred to the voluntary arbitrators designated in advance by the parties to a
CBA. Consequently only disputes involving the union and Atlas shall be referred to the grievance
machinery or voluntary arbitrators. In these termination cases, the union had no participation, it
having failed to object to the dismissal of the employees concerned by the petitioner. It is obvious
that arbitration without the union’s active participation on behalf of the dismissed employees
would be pointless, or even prejudicial to their cause.

ORESHOOT MINING COMPANY VS HON. ARELLANO- DULNUAN

FACTS: Initially, the Director of Regional Office No. IV ordered for the reinstatement of
complainants Rodrigo Baaco, Manuel Rodriguez, Rolando Pacaldo Silvestre Teodoro, Albino
Bungalso and Rufino Bungalso.

Oreshoot filed two (2) motions for reconsideration. The first was denied; the second was treated
as an appeal and transmitted by the Regional Director to the Office of the Minister of Labor and
Employment. Acting thereon, the Deputy Minister rendered an Order on May 27, 1985, affirming
the aforesaid adjudgment made by the Regional Director.

Oreshoot Mining though a special civil action of certiorari assailed the decision of the der of the
Deputy Minister of Labor and Employment which affirmed with modification the Order of the
Director of Regional Office No. IV on the ground the Regional Director had no jurisdiction to take
cognizance of and adjudicate the claims of above-named employees

ISSUE: WON the Regional Director had jurisdiction

RULING:NO. The Regional Director had no jurisdiction to try and decide claims of workers and
employees of their illegal dismissal from employment, and for their reinstatement and recovery of
monetary and other benefits consequent.
At the time of the filing of the cases at bar, original and exclusive jurisdiction was vested in
Labor Arbiters to hear and decide all money claims of workers, including those based on non-
payment or underpayment of wages, overtime compensation, separation pay and other benefits
provided by law or appropriate agreement, except claims for employees' compensation, social
security, medicare and maternity benefits," and all other claims arising from employer-employee
relations, unless expressly excluded by ... (the) Code.

In the case of a money claim, the Regional Director's power was limited to receiving the complaint,
investigating it and trying to effect conciliation, and, if no settlement was reached, certifying the
case to the Labor Arbiter.

In cases of shutdowns or dismissals, the Regional Director was empowered to initially decide
whether to certify the same to the Executive Labor Arbiter or to summarily investigate and decide
it within 10 days from filing.

It is worthy of note that where there was need for "hearing and decision on the merits" in relation
to applications for clearance to shut down or dismiss, that function of hearing and deciding was
not entrusted to the Regional Director but to the Executive Arbiter (or other Labor Arbiters). This
is clear from the provision requiring the Regional Director to certify the case to the Executive
Arbiter. That and other related provisions make clear that in reality, the only power accorded to
the Director was either to deny the application for shut down or dismissal after "summary
investigation," or certify the same to the Executive Arbiter. And he could only himself act on an
application for clearance to shut down or dismiss, only if the case did not involve "intricate
questions of law" or was not otherwise suited for summary investigation. 8 But, to repeat, where
there was necessity to pass "upon the merits" of an application, he could not deny it, but had
perforce to certify it to the Executive Arbiter.

ALBAY MARKETING VS MARTINEZ - FLORA

FACTS: Petitioner avers private respondents Conrado Buban and Arnaldo Bonagua were
designated as acting manager (Commercial Services Department) and supervisor (Service Center),
respectively, of Albay I Electric Cooperative, inc. by Israel Garcia, petitioner's Acting General
Manager. Garcia allegedly made the appointments after his own appointment was recalled by the
National Electrification Administration (NEA)

The Board of Director of ALECO I considered the midnight appointments of respondents Buban
and Bonagua as null and void.

Private respondents filed a complaint with the Office of the Regional Director for the recovery of
salary differentials corresponding to their new positions. They also claimed that since they held
their respective positions for more than one year, their status should be classified as permanent
and they should be paid the corresponding salaries.

Petitioner moved to dismiss the complaint for lack of jurisdiction. Regional Director issued an
Order requiring the petitioner to pay respondents Bonagua and Buban P11,962.31 and P12,593.36,
respectively, corresponding to the underpayment of wages for their new positions

Petitioner filed a notice of appeal and Memorandum of Appeal. Instead of giving due course to the
appeal, the Med-Arbiter denied the same and directed the parties to present evidence. In its position
paper, petitioner assailed the Order denying its appeal and further argued that since the amount
claimed by private respondents is in excess of P5,000.00, the Regional Director has no jurisdiction
to entertain the complaint.

Petitioner contends that since each of the money claims of private respondent exceeded P5,000.00,
the complaint falls outside the jurisdiction of the respondent Regional Director and should properly
be heard by the Labor Arbiter.

Public respondent argues however that under his visitorial power, the P5,000.00 jurisdictional limit
does not apply.

Public respondent hastens to add that the purpose of the law is to afford to the workers an
expeditious delivery of what legally belongs to them; thus, the jurisdictional P5,000.00 limit need
not apply.

ISSUE: Whether the Labor Arbiter has jurisdiction over the case

RULING: Clearly, the jurisdiction over the instant dispute lies exclusively and originally with the
Labor Arbiter, the claims being in excess of P5,000.00 each.

Art. 217. Jurisdiction of Labor Arbiters and the Commission. — Except as otherwise provided
under this Code, the Labor Arbiters shall have original and exclusive jurisdiction to hear and
decide, within thirty (30) calendar days after the submission of the case by the parties for decision
without extension, even in the absence of stenographic notes, the following cases involving
workers, whether agricultural or non-agricultural:

(6) Except claims for employees compensation, social security, medicare and maternity benefits,
all other claims arising from employer-employee relations, including those of persons in domestic
or household service, involving an amount exceeding five thousand pesos (P5,000.00), whether or
not accompanied with a claim for reinstatement.

Neither can private respondents successfully invoke the visitorial power of the Regional Director
as provided under Article 128 of the Labor Code.

The power to hear and decide employee's claim exceeding P5,000.00 for each employee should be
left to the Labor Arbiter as the exclusive repository of the power to hear and decide such claims.

Since the amount claimed by each respondent exceeded the P5,000.00 jurisdictional limit
conferred upon public respondent, the latter acted without jurisdiction in ordering petitioner to pay
private respondents' claim for salary differentials and 13th month pay
Furthermore, the fact that petitioner raised the propriety of granting the claimed salary differentials
in favor of private respondents should have alerted public respondent to exercise utmost restraint
in assuming jurisdiction over the complaint. When the employer contests the findings of the
Regional Director, the case must be referred to the Labor Arbiter.

CIRINEO BOWLING PLAZA, INC., vs. SENSING- FOLLANTE

FACTS: Eligio Paolo, Jr., an employee of petitioner, filed a letter complaint with the DOLE
Dagupan District Office, requesting for the inspection/investigation of petitioner for various labor
law violations like underpayment of wages, 13th month pay, non-payment of rest day pay,
overtime pay, holiday pay and service incentive leave pay. Pursuant to the visitorial and
enforcement powers of the Secretary of Labor and Employment, his duly authorized representative
under Article 128 of the Labor Code, as amended, conducted inspections on petitioner’s
establishment the following day. In his inspection report,Labor and Employment Officer III,
Crisanto Rey Dingle, found that petitioner has thirteen employees and had committed the
following violations: underpayment of minimum wage, 13th month pay, holiday premiums,
overtime premiums, and non-payment of rest day. The findings in the inspection report were
explained to petitioner’s officer-in-charge, Ma. Fe Boquiren, who signed the same.
An Order was issued by the DOLE that crespondent is hereby ordered to pay them the total amount
of P377,500.58, representing their unpaid/underpaid wages, 13th month pay, holiday premiums,
rest day pay and overtime premiums.

And to submit the proof of payment to this Office within ten days from receipt.. Otherwise, a Writ
of Execution will be issued to enforce this order.

Respondent is further ORDERED to adjust the salaries of its employees to the applicable daily
minimum wages and to submit the proof thereof within the same period.

Petitioner’s representative, Carmen Zapata, appeared before the DOLE Regional Office and
submitted the quitclaims, waivers and releases of employees-awardees, Lamberto Solano, Jovelyn
Quinto, Manuel Benitez, Edgar Dizon, Ronillo Tandoc, Eligio Paolo, Jr., and Dario Benitez. Later,
however, Benitez, Tandoc, Quinto and Dizon wrote DOLE a letter denying having received any
amount from petitioner. DOLE’s inspector Dingle went to petitioner’s establishment to confirm
the authenticity of the quitclaims and releases and talked to the employees concerned who stated
that they signed the document without knowing its contents but they are willing to settle if they
will be given the amount computed by DOLE.
Luisito Cirineo and a certain Fe Cirineo Octaviano, owner of Esperanza Seafoods Kitchenette
stationed in petitioner’s establishment, wrote DOLE a letter requesting that the case be endorsed
to the National Labor Relations Commission since the resolution of the case required evidentiary
matters not disclosed or verified in the normal course of inspection. They also submitted
documents to show that petitioner and Esperanza Seafoods Kitchenette are separate and distinct
business entities and that some of the employees-awardees are actually employees of the Esperanza
Seafoods Kitchenette.
DOLE Regional Director Maximo B. Lim issued a writ of execution. Petitioner filed a motion to
quash the writ of execution.
In an Order, DOLE Regional Director Lim denied petitioner’s motion to quash the writ of
execution.
Petitioner filed its Memorandum of Appeal to the Secretary of Labor and Employment who
dismissed the appeal on the ground that same was filed out of time. On motion for reconsideration,
the appeal was granted and the appeal was given due course.

ISSUE: WHETHER PUBLIC RESPONDENT ACTED WITH GRAVE ABUSE OF

DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION WHEN IT
DISMISSED THE INSTANT PETITION AND OUTRIGHT DISMISSAL OF PETITIONER’S
MOTION FOR RECONSIDERATION DUE TO MERE TECHNICALITIES.

HELD: Even if we disregard technicality, we find the arguments raised by petitioner without merit.
As correctly held by the DOLE Regional Director and sustained by the DOLE Undersecretary,
records show that petitioner never refuted the findings of the labor inspector as to the identity of
the thirteen employees nor raised the issue of separate juridical personalities of petitioner Cirineo
and Esperanza Seafoods Kitchenette during the investigation and on the hearings conducted.
Likewise, we sustain the jurisdiction of the DOLE Regional Director. The visitorial and
enforcement powers of the DOLE Regional Director to order and enforce compliance with labor
standard laws can be exercised even where the individual claim exceeds P5,000.00
(Art. 128. Visitorial and enforcement power is cited)
In the case at bar, the Office of respondent Regional Director conducted inspection visits at
petitioner’s establishment on February 9 and 14, 1995 in accordance with the above-mentioned
provision of law. In the course of said inspection, several violations of the labor standard
provisions of the Labor Code were discovered and reported by Senior Labor Enforcement Officer
Eduvigis A. Acero in his Notice of Inspection Results. It was on the bases of the aforesaid findings
(which petitioner did not contest), that respondent Regional Director issued the assailed Order for
petitioner to pay private respondents the respective wage differentials due them.
Clearly, as the duly authorized representative of respondent Secretary of Labor, and in the lawful
exercise of the Secretary’s visitorial and enforcement powers under Article 128 of the Labor Code,
respondent Regional Director had jurisdiction to issue his impugned Order.
WHEREFORE, the instant petition is DISMISSED for lack of merit

SMC vs NLRC - Garduce

FACTS: The respondents are members of the Ilaw at Buklod ng Manggagawa (IMB). They were
employees (mechanics, machinists, and carpenters) of San Miguel Corporation (SMC).
In July 1990, they were served a Memorandum from Angel G. Roa, VP of SMC’s Business
Logistics Division, saying they are separated from the service effective October 31, 1990, on the
ground of redundancy or excess personnel. IMB opposed the intended dismissal and asked for a
dialogue with management.
A series of dialogues were held between them. But before its conclusion, Angel Roa issued another
Memorandum on October 1, 1990 informing the respondents that they would be dismissed from
work effective as of the close of business hours on November 2, 1990. The respondents were in
fact purged on the date aforesaid.
In Feb 1991, IMB filed a complaint against SMC for Illegal Dismissal and Unfair Labor Practices,
with a prayer for damages and attorneys fees, with the Arbitration Branch of NLRC. The complaint
was assigned to LA Eduardo F. Carpio.

In April 1991, SMC filed a motion to dismiss the complaint, alleging that the LA had no
jurisdiction over the subject matter of the complaint, and he must defer consideration of the unfair
labor practice complaint until after the parties have gone through the grievance procedure provided
for in the existing CBA. The LA denied this motion.

SMC appealed the denial to the NLRC. Unimpressed by the grounds, the NLRC dismissed it, as
well as the Motion for Reconsideration.

Hence, SMC elevated the case to the SC via a petition for certiorari (Rule 65).
Main Issue: Whether the LA has jurisdiction to hear a complaint for ULP, illegal dismissal, and
damages, notwithstanding the provision for grievance and arbitration in the CBA.
Held: Yes, the LA has jurisdiction.

SMC’s first contention: They posit the basic principle that a CBA is a contract between
management and labor that must bind and be enforced in the first instance as between the parties.
In this case, the CBA had a section stating that wages, hours of work, conditions of employment
and/or employer-employee relations shall be settled by arbitration. SMC is contending that the
dispute (re: termination of the union members and the unfair labor practice) should be settled by
arbitration first, and not directly by the LA.

SC’s Decision: The argument is unmeritorious. The law in point is Article 217 (a) of the Labor
Code. It is elementary that this law is deemed written into the CBA. In fact, the law speaks in plain
and unambiguous terms that termination disputes, together with unfair labor practices, are matters
falling under the original and exclusive jurisdiction of the Labor Arbiter.
SMC’s second contention: They insist that the interpretation and implementation of the CBA is
grievable and arbitrable by law under Article 217(c) of the Labor Code, and shall be “disposed of
by the Labor Arbiter by referring the same to the grievance machinery and voluntary arbitration
as may be provided in said agreements”.

They theorize that since IMB questioned the discharges, the main question for resolution is
whether SMC had the management right or prerogative to discharge on the ground of redundancy,
and this necessarily calls for the interpretation or implementation of the CBA.
SC’s Decision: SMC’s theory does not hold water. There is no connection whatsoever between
SMCs management prerogative and the interpretation of the CBA. The questioned discharges due
to alleged redundancy can hardly be considered company personnel policies and therefore need
not directly be
subject to the grievance machinery nor to voluntary arbitration.

SMC’s third contention: The ULP claims are merely conclusory and cannot serve to vest
jurisdiction to the Labor Arbiters. There is no allegation of the existence of anti-union animus or
of the ultimate facts showing how the discharges affected the rights to self-organization. In short,
SMC maintains that the complaint does not allege a genuine case for ULP.

SC’s Decision: The complaint makes out a genuine case for ULP.
As held in Manila Pencil Co. vs CIR, even where business conditions justified a lay-off of
employees, unfair labor practices were committed in the form of discriminatory dismissal where
only unionists were permanently dismissed.

All of the dismissed employees were officers and members of their respective unions, and their
employers failed to give a satisfactory explanation as to why this group of employees was
singled out.
It is possible that such may only be a clever scheme of the company to camouflage its real
intention of discriminating against union members.

But in any case, these matters will be best ventilated in a hearing before the Labor Arbiter. The
SC cannot hold SMC guilty of the ULP charge. This will be the task of the Labor Arbiter. But
the SC finds that based on the circumstances and settled jurisprudence, the complaint filed by
tIMB alleges facts sufficient to constitute a bona fide case of ULP, and therefore properly
cognizable by the Labor Arbiter under Article 2 17(a) of the Labor Code. Jurisdiction over the
subject matter is determined by the allegations of the complaint.
Petition dismissed.

G.R. No. 163782

LIGHT RAIL TRANSIT AUTHORITY, Petitioner,
vs.
PERFECTO H. VENUS, JR., BIENVENIDO P. SANTOS, JR., RAFAEL C. ROY,
NANCY C. RAMOS, SALVADOR A. ALFON, NOEL R. SANTOS, MANUEL A.
FERRER, SALVADOR G. ALINAS, RAMON D. LOFRANCO, AMADOR
H.POLICARPIO, REYNALDO B. GENER, and BIENVENIDO G. ARPILLEDA,
Respondents.
x-----------------------------x
G.R. No. 163881
METRO TRANSIT ORGANIZATION, INC., Petitioner,
vs.
COURT OF APPEALS, PERFECTO H. VENUS, JR., BIENVENIDO P. SANTOS, JR.,
RAFAEL C. ROY, NANCY C. RAMOS, SALVADOR A. ALFON, NOEL R. SANTOS,
MANUEL A. FERRER, SALVADOR G. ALINAS, RAMON D. LOFRANCO, AMADOR
H. POLICARPIO, and REYNALDO B. GENER, Respondents. – GONADAN

FACTS: Problem: Reinstatement of respondent workers, loss of seniority and other rights and
privileges, and payment of full back wages, benefits, and moral damages.

This is a consolidated petitions of Light Rail Transit Authority (LRTA) and Metro Transit
Organization, Inc. (METRO), seeking the reversal of the Decision of the Court of Appeals
directing them to reinstate private respondent workers to their former positions without loss of
seniority and other rights and privileges, and ordering them to jointly and severally pay the latter
their full back wages, benefits, and moral damages.

Petitioner LRTA is a government-owned and controlled corporation, on the other hand is Petitioner
METRO, was a qualified transportation corporation duly organized in accordance with the
provisions of the Corporation Code, registered with the Securities and Exchange Commission, and
existing under Philippine laws.

Petitioner LRTA constructed a light rail transit system from Monumento in Kalookan City to
Baclaran in Parañaque, Metro Manila. To provide the commuting public with an efficient and
dependable light rail transit system, petitioner LRTA, after a bidding process, entered into a ten
(10)-year Agreement for the Management and Operation of the Metro Manila Light Rail Transit
System from June 8, 1984 until June 8, 1994 with petitioner METRO

Pursuant to the Agreement, petitioner METRO hired its own employees, including herein private
respondents. Petitioner METRO thereafter entered into a collective bargaining agreement with
Pinag-isang Lakas ng Manggagawa sa METRO, Inc. – National Federation of Labor, otherwise
known as PIGLAS-METRO, INC. – NFL – KMU (Union), the certified exclusive collective
bargaining representative of the rank-and-file employees of petitioner METRO.

On June 9, 1989 LRTA and METRO executed a Deed of Sale where petitioner LRTA purchased
the shares of stocks in petitioner METRO. However, petitioners LRTA and METRO continued
with their distinct and separate juridical personalities. Hence, when the above ten (10)-year
Agreement expired on June 8, 1994, they renewed the same, initially on a yearly basis, and
subsequently on a monthly basis.
July 25, 2000, the Union filed a Notice of Strike with the National Conciliation and Mediation
Board – National Capital Region against METRO on account of a deadlock in the collective
bargaining negotiation. On the same day, the Union struck. The power supply switches in the
different light rail transit substations were turned off. The members of the Union picketed the
various substations. They completely paralyzed the operations of the entire light rail transit system.
As the strike adversely affected the mobility of the commuting public, then Secretary of Labor
Bienvenido E. Laguesma issued on that same day an assumption of jurisdiction order directing all
the striking employees "to return to work immediately upon receipt of this Order and for the
Company to accept them back under the same terms and conditions of employment prevailing
prior to the strike.

Despite the issuance, posting, and publication of the assumption of jurisdiction and return to work
order, the Union officers and members, including herein private respondent workers, failed to
return to work. private respondents, Perfecto Venus, Jr., Bienvenido P. Santos, Jr., Rafael C. Roy,
Nancy C. Ramos, Salvador A. Alfon, Noel R. Santos, Manuel A. Ferrer, Salvador G. Alinas,
Ramon D. Lofranco, Amador H. Policarpio, Reynaldo B. Gener, and Bienvenido G. Arpilleda,
were considered dismissed from employment. Meanwhile the agreement between LRTA and
METRO expired and was not renewed and the LRTA management instead took over the operations
the private respondents filed a complaint for illegal dismissal before the NLRC.
Labor Arbiter Luis D. Flores rendered a consolidated judgment in favor of the private respondent
workers declaring that the complainants were illegally dismissed from employment and ordering
their reinstatement to their former positions without loss of seniority and other rights and
privileges.

On appeal, the NLRC found that the striking workers failed to heed the return to work order and
reversed and set aside the decision of the labor arbiter. The suit against LRTA was dismissed since
"LRTA is a government-owned and controlled corporation created by virtue of Executive Order
No. 603 with an original charter" and "it had no participation whatsoever with the termination of
complainants’ employment." In fine, the cases against the LRTA and METRO were dismissed,
respectively, for lack of jurisdiction and for lack of merit. Hence, twin petitions for review on
certiorari of the decision of public respondent appellate court filed by LRTA and METRO which
this Court eventually consolidated.

Petitioner LRTA’s contentions:

(1) argues that it has no employer-employee relationship with private respondent workers as they
were hired by petitioner METRO alone pursuant to its ten (10)-year Agreement for the
Management and Operation of the Metro Manila Light Rail Transit System with petitioner
METRO.
(2) Private respondent workers recognized that their employer was not petitioner LRTA when
their certified exclusive collective bargaining representative, the Pinag-isang Lakas ng
Manggagawa sa METRO, Inc. – National Federation of Labor, otherwise known as PIGLAS-
METRO, INC. – NFL – KMU, entered into a collective bargaining agreement with petitioner
METRO. Piercing the corporate veil of METRO was unwarranted, as there was no competent and
convincing evidence of any wrongful, fraudulent or unlawful act on the part of METRO, and, more
so, on the part of LRTA.
(3) LRTA further contends that it is a government-owned and controlled corporation with an
original charter, Executive Order No. 603, Series of 1980, as amended, and thus under the
exclusive jurisdiction only of the Civil Service Commission, not the NLRC.

Private respondent workers contend that: Petitioner METRO was not only fully-owned by
petitioner LRTA, but all aspects of its operations and administration were also strictly controlled,
conducted and directed by petitioner LRTA. And since petitioner METRO is a mere adjunct,
business conduit, and alter ego of petitioner LRTA, their respective corporate veils must be pierced
to satisfy the money claims of the illegally dismissed private respondent employees.

ISSUES:
Whether or not the NLRC has jurisdiction over LRTA’s employees or is it the CSC? (No)
Whether or not private respondents were illegally dismissed? (Yes)

RULING: The SC agrees with petitioner LRTA. Section 2 (1), Article IX – B, 1987 Constitution,
expressly provides that “the civil service embraces all branches, subdivisions, instrumentalities,
and agencies of the Government, including government-owned or controlled corporations with
original charters." Corporations with original charters are those which have been created by special
law and not through the general corporation law. In contrast, petitioner METRO is covered by the
Labor Code despite its later acquisition by petitioner LRTA, SC holds that the employees of
petitioner METRO cannot be considered as employees of petitioner LRTA. The employees hired
by METRO are covered by the Labor Code and are under the jurisdiction of the Department of
Labor and Employment, whereas the employees of petitioner LRTA, a government-owned and
controlled corporation with original charter, are covered by civil service rules. Herein private
respondent workers cannot have the best of two worlds, e.g., be considered government employees
of petitioner LRTA, yet allowed to strike as private employees under our labor laws. Petitioner
LRTA cannot be held liable to the employees of petitioner METRO.
With regard the issue of illegal dismissal, petitioner METRO maintains that private respondent
workers were not illegally dismissed but should be deemed to have abandoned their jobs after
defying the assumption of jurisdiction and return-to-work order issued by the Labor Secretary.
Private respondent workers, on the other hand, submit that they could not immediately return to
work as the light rail transit system had ceased its operations. The contention of the petitioner that
the private respondents abandoned their position is also not acceptable. An employee who
forthwith takes steps to protest his lay-off cannot by any logic be said to have abandoned his work.
For abandonment to constitute a valid cause for termination of employment there must be a
deliberate, unjustified refusal of the employee to resume his employment. This refusal must be
clearly established. Mere absence is not sufficient; it must be accompanied by overt acts unerringly
pointing to the fact that the employee simply does not want to work anymore.
Wherefore, petition is denied. So ordered.

Espanol vs. Philippine Veterans Administration - LUMASAC

Facts: Maria Espanol was the widow of deceased veteran German Espanol who died in service
during WWII. Maria and her children received monthly pension under RA No. 65 with respondent
PVA. In November 1, 1951, PVA’s administrative policy was issued cancelling the pension being
received from US Veterans Administration; this includes the pension of Maria and her children.

On February 25, 1974 or after 22 years from the cancellation date, Maria filed before CFI Manila
a petition for mandamus against PVA for the restoration and continued payment of the pension.
CFI granted the petition. PVA appealed in the CA, which elevated the case to the SC since only
questions of law are involved. PVA contested that the action for restoration has already prescribed
with the lapse of 10 years from the date of cancellation.

Issue:
1. Was the action to compel restoration of the pension prescribed?

Held:
1. No, because the prescriptive period of an action based on an obligation accrues only when
there exist all the elements of a cause of action. The third element being an act or omission on the
part of defendant violative of the right of the plaintiff is absent in the case because administrative
regulations and policies are given presumption of legality. Because of this presumption, the
administrative policy that cancelled the pension cannot be taken as violative of Maria and her
children’s right to receive the pension under RA 65. In the absence of third element, the 10-year
prescriptive period has not run from the date of cancellation.However, SC declared invalid the
same administrative policy in the case of Del Mar vs PVA, promulgated on June 27, 1973. The
presumption of legality of the policy has been rebutted rendering PVA’s act a violation of Maria’s
right to receive the pension. This entitled Maria a right of action against PVA and the date of
promulgation of Del Mar case is the date when the 10-year prescriptive period should be counted
from.

VICTOR CLAPANO, et al. vs. HON. FILOMENO GAPULTOS, et al.

(G.R. Nos. L-51574-77 September 30, 1984)
CONTEMPT POWER – MADRID

FACTS: The spouses Conrado Crisostomo and Thelma Gallaza mortgaged 3 parcels of land with
respondent Philippine National Bank, General Santos City Branch (PNB), as security for a loan.
The mortgage was extrajudicially foreclosed because of the spouses' failure to settle their
obligation, and the properties were sold at public auction to the PNB as the highest bidder. PNB
took possession of the same.

PNB executed a Deed of Promise to Sell said land in favor of respondent Princessita Jabido-Maulit.
When the vendee, Princessita, tried to take physical possession of the land, petitioners Fernando
Abellon and his wife Conchita Abellon (Abellons) claiming to be the tenants of the former owner,
Crisostomo, refused to give up possession.

PNB and Princessita filed with the CFI of South Cotabato, Branch II, Koronadal an "Ex-Parte
Motion for the Issuance of Writ of Possession. The Writ was issued placing PNB and/or Princessita
in possession, to the exclusion of the former owners. Another Order was issued directing
respondent Provincial Sheriff to place PNB and Princessita in complete possession of the subject
property, and to remove and destroy the temporary huts and/or dwellings and other improvements
in the premises huts and/or dwellings and other improvements in the premises that appear to
obstruct and prevent execution. PNB and Princessita were thus placed in complete possession.

However, in another proceeding before the then Court of Agrarian Relations of Cotabato City
(CAR) Branch II, the Abellons filed a Petition for Reinstatement. The CAR issued a Restraining
Order enjoining respondents and/or their representatives from further depriving the Abellons of
the peaceful possession of the land they were tenanting. Attempts by private respondents to
dissolve that Order were unsuccessful.

When the Abellons re-entered the area and harvested coconuts, PNB and Princessita charged the
Abellons with contempt of Court before the CFI of South Cotabato. Atty. Victor A. Clapano
(petitioner’s counsel) was included because he had allegedly instructed Abellons not to vacate the
property.

The CFI issued the challenged Order finding that there existed prima facie evidence of contempt
of Court against petitioners and directed the Provincial Fiscal to file five (5) separate Informations
against them covering five allegedly contemptuous acts committed on different dates. Complying,
the Provincial Fiscal filed four (4) separate Informations for Indirect Contempt against petitioners
in the CFI. Petitioners moved to quash the Informations but quashal was denied. Petitioners Victor
Clapano, Alejandro Abejeron Tertuliano Abejeron, Fernando Abellon. Conchita Abellon. Anias
Mahinay and Marcelo Saycon are now before us assailing the above Orders of respondent CFI.

ISSUE: Whether the petitioners can be charged of contempt.

HELD: NO. The Informations filed against petitioners in the criminal cases in the Court of First
Instance of South Cotabato, Branch 11, at Koronadal, are declared null and void.
Fuentes, et al vs. Leviste, et als., is authority for the doctrine that the mere refusal of the defeated
party to surrender the property to the winning party upon the order of the sheriff does not, constitute
contempt. And although it has been held that there is contempt of Court when the defeated party
re-enters the land after possession thereof has been delivered to the prevailing party by the sheriff
in the enforcement of the writ of execution, the peculiar circumstances of this case exculpate
petitioners from any charge of contempt.
(***Further explanation: In the first place, petitioners were successful in obtaining an Order
upholding their tenancy status and enjoining the defendants therein from depriving them of their
possession and cultivation of the subject property. Secondly, under Section 35, Rule 39 of the
Rules of Court, the possession of property is given to a purchaser in extrajudicial foreclosures
unless a third party is actually holding the property adversely to the judgment debtor. In this case,
the subject land was being possessed and cultivated by the Abellons as third parties, whose status
as tenants was recognized in CAR case. In the CAR case, the parties eventually entered into a
Compromise Agreement, wherein they stipulated among other things, that the Abellons were being
conceded to be tenants of the subject property, and were being allowed to re-enter the landholding.
Thirdly, as tenants, Abellons are protected by Presidential Decree No. 1038, which provides that
no tenant tiller of private agricultural lands devoted to crops other than rice and/or corn shall be
removed, ejected, ousted or excluded from his farm holding unless for causes provided by law and
directed by a final decision or order of the court. Sale of the land is not included as one of the just
causes for removal of tenants.)

HON. ALFREDO LIM and RAFAELITO GARAYBLAS, petitioners, vs. THE COURT
OF APPEALS, HON. WILFREDO REYES and BISTRO PIGALLE, INC., respondents.
- MACATULAD

Facts: On December 7, 1992 Bistro filed before the trial court a petition for mandamus and
prohibition, with prayer for tro or writ of preliminary injunction, against Lim in his capacity as
Mayor of Manila. Bistro filed the case because policemen under Lims instructions inspected and
investigated Bistros license as well as the work permits and health certificates of its staff. This
caused the stoppage of work in Bistros night club and restaurant operations. Lim also refused to
accept Bistros application for a business license, as well as the work permit applications of Bistros
staff.

The trial court: issued the tro Ordering Lim to refrain from inspecting or otherwise interfering in
the operation of the establishments of Bistro. The writ of prohibitory preliminary injunction was
also issued.

Despite the trial courts order, Lim still issued a closure order on Bistro, even sending policemen
to carry out his closure order.

Bistro filed an Urgent Motion for Contempt against Lim and the policemen who stopped Bistros
operations. On several dates, Lim, acting through his agents and policemen, again disrupted Bistros
business operations. Lim also filed a motion to dissolve the injunctive order and to dismiss the
case.

The trial court denied Lims motion to dissolve the injunction and to dismiss the case.
Lim filed with the Court of Appeals a petition for certiorari, prohibition and mandamus against
Bistro and Judge Wilfredo Reyes.
CA: denied Lims motion for reconsideration.

Issue
Whether the Mayor has the power to close down operations of night clubs

Lim:
Lim relies primarily on his power, as Mayor of the City of Manila, to grant and refuse municipal
licenses and business permits as expressly provided for in the Local Government Code and the
Revised Charter of the City of Manila. Lim argues that the powers granted by these laws implicitly
include the power to inspect, investigate and close down Bistros operations for violation of the
conditions of its licenses and permits.

Bistro: Bistro asserts that the legal provisions relied upon by Lim do not apply to the instant case.
Bistro maintains that the Local Government Code and the Revised Charter of the City of Manila
do not expressly or impliedly grant Lim any power to prohibit the operation of night clubs. Lim
failed to specify any violation by Bistro of the conditions of its licenses and permits. In refusing
to accept Bistros business license application. Bistro claims that Lim denied Bistro due process of
law.

SC: The authority of mayors to issue business licenses and permits is beyond question. The power
of the mayor to issue business licenses and permits necessarily includes the corollary power to
suspend, revoke or even refuse to issue the same. However, the power to suspend or revoke these
licenses and permits is expressly premised on the violation of the conditions of these permits and
licenses. The laws specifically refer to the violation of the condition(s) on which the licenses and
permits were issued. Similarly, the power to refuse to issue such licenses and permits is premised
on non-compliance with the prerequisites for the issuance of such licenses and permits. The mayor
must observe due process in exercising these powers, which means that the mayor must give the
applicant or licensee notice and opportunity to be heard.

True, the mayor has the power to inspect and investigate private commercial establishments for
any violation of the conditions of their licenses and permits. However, the mayor has no power to
order a police raid on these establishments in the guise of inspecting or investigating these
commercial establishments. Lim acted beyond his authority.

Lim has no authority to close down Bistros business or any business establishment in Manila
without due process of law. Lim cannot take refuge under the Revised Charter of the City of Manila
and the Local Government Code. There is no provision in these laws expressly or impliedly
granting the mayor authority to close down private commercial establishments without notice and
hearing, and even if there is, such provision would be void. The due process clause of the
Constitution requires that Lim should have given Bistro an opportunity to rebut the allegations that
it violated the conditions of its licenses and permits.

The regulatory powers granted to municipal corporations must always be exercised in accordance
with law, with utmost observance of the rights of the people to due process and equal protection
of the law. Such power cannot be exercised whimsically, arbitrarily or despotically. In the instant
case, we find that Lims exercise of this power violated Bistros property rights that are protected
under the due process clause of the Constitution.

Procedure and Appeals

G.R. No. 82211-12 March 21, 1989

TERESITA MONTOYA, petitioner, vs. TERESITA ESCAYO, JOY ESCAYO, AIDA
GANANCIAL, MARY ANN CAPE, CECILIA CORREJADO, ERLINDA PAYPON and
ROSALIE VERDE, AND NATIONAL LABOR RELATIONS COMMISSION,
respondents.
-MASEDMAN

FACTS: The private respondents were all formerly employed as salesgirls in the petitioner's store,
the "Terry's Dry Goods Store," in Bacolod City. They filed complaints for the collection of sums
of money against the employer for alleged unpaid overtime pay, holiday pay, 13th month pay,
ECOLA, and service leave pay: for violation of the minimum wage law, illegal dismissal, and
attorney's fees.

On August 1, 1984, the petitioner moved for the dismissal of the complaints, claiming that the
respondents failed to refer the dispute to the Lupong Tagapayapa for possible settlement and to
secure the certification required from the Lupon Chairman prior to the filing of the cases with the
Labor Arbiter. These actions were allegedly violative of the provisions of P.D. No. 1508.

On September 27, 1985 Labor Arbiter Ethelwoldo R. Ovejera ordered the dismissal of the
complaints. The respondents sought the reversal of the Labor Arbiter's order before the respondent
NLRC.

August 20, 1987, the public respondent rendered the assailed resolution reversing the order of
Ovejera, and remanded the case to the Labor Arbiter for further proceedings. A motion for
reconsideration was filed by the petitioner but this was denied for lack of merit on October 28,
1987.

PETITIONER: The petitioner insists that the failure of the private respondents to first submit their
complaints for possible conciliation and amicable settlement in the proper barangay court in
Bacolod City and to secure a certification from the Lupon Chairman prior to their filing with the
Labor Arbiter, divests the Labor Arbiter, as well as the respondent Commission itself, of
jurisdiction over these labor controversies and renders their judgments thereon null and void.

RESPONDENTS: Respondents argues against the applicability of P.D. No. 1508 to labor cases.

ISSUE: Whether P.D. 1508 applies to labor cases

HELD:
Petition is dismissed.
The provisions of P.D. No. 1508 requiring the submission of disputes before the barangay Lupong
Tagapayapa prior to their filing with the court or other government offices are not applicable to
labor cases..

From the three "WHEREAS" clauses of P.D. No. 1508 it clearly seen that it is intended to apply
only to courts of justice, and not to labor relations commissions or labor arbitrators' offices.

In addition, LOI No. 956 and LOI No. 105, issued in connection with the implementation of the
Katarungang Pambarangay Law were addressed only to the following officials: all judges of the
Courts of first Instance, Circuit Criminal Courts, Juvenile and Domestic Relations Courts, Courts
of Agrarian Relations, City Courts and Municipal Courts, and all Fiscals and other Prosecuting
Officers. These presidential issuances make clear that the only official directed to oversee the
implementation of the provisions of P.D. No. 1508 are the then Minister of Justice, the then
Minister of Local Governments and Community Development, and the Chief Justice of the
Supreme Court.

Also, Article 226 of the labor code grants original and exclusive jurisdiction over the conciliation
and mediation of disputes, grievances, or problems in the regional offices of the Department of
Labor and Employment. It is the said Bureau and its divisions, and not the barangay Lupong
Tagapayapa, which are vested by law with original and exclusive authority to conduct conciliation
and mediation proceedings on labor controversies before their endorsement to the appropriate
Labor Arbiter for adjudication.

RATIO: Requiring conciliation of labor disputes before the barangay courts would defeat the very
salutary purposes of the law. Instead of simplifying labor proceedings designed at expeditious
settlement or referral to the proper court or office to decide it finally, the position taken by the
petitioner would only duplicate the conciliation proceedings and unduly delay the disposition of
the labor case.

If the procedure suggested is complied with, the private respondent would have to lodge first their
complaint with the barangay court, and then if not settled there, they would have to go to the labor
relations division at the Regional Office of Region VI of the Department of Labor and
Employment, in Bacolod City, for another round of conciliation proceedings. If they fail they
would continue to the Office of the Labor Arbiter, then to the NLRC, and finally to us. This
suggested procedure would destroy the salutary purposes of P.D. 1508 and of The Labor Code..
And labor would then be given another unnecessary obstacle to hurdle.

Finally, it is already well-settled that the ordinary rules on procedure are merely suppletory in
character vis-a-vis labor disputes which are primarily governed by labor laws.

Rapid Manpower Consultant v. NLRC – MAYAOYAO

Facts: The petitioner in behalf of its accredited principal, Albert Abela Group/Saudi Catering and
Contracting Services, hired Wilfredo Nazareno, David Prodigalidad, Dante San Miguel, and
Fernando Dabu (complainants) as janitor and deployed them at Khaled International Airport in
Riyadh, Saudi Arabia for three years. Before the expiration of their contract, the complainants
were repatriated to the Philippines allegedly on violations of company rules and laws of Saudi
Arabia. On September 18, 1985, they filed a complaint with the POEA for illegal dismissal and
payment of overtime pay, salary differential and attorney's fees. On November 3, 1986,
petitioner filed a Manifestation reserving its light to present additional evidence as soon as the
same are made available by its principal in Al-Khobar, Kingdom of Saudi Arabia.

On January 15, 1987, the POEA rendered its decision and required the Rapid manpower and the
Albert group to pay jointly and severally the complainants their salaries corresponding to the
unexpired portion of their contracts and unpaid overtime pay.

On February 9, 1987, petitioner appealed to the NLRC and contented that the POEA erred in
appreciating the facts.

On June 16, 1987, petitioner filed a Supplemental Memorandum on Appeal with Motion for New
Trial and claimed that it received the original employment records of the complainant from the
office of their foreign employer in Saudi Arabia that would justify the dismissal of complainants
and would serve as evidence.

On November 22, 1988, the NLRC affirmed the decission of POEA and remanded the case for
further reception of evidence on the issue of ILLEGAL DISMISSAL only.
The petitioner then appealed to the supreme court that NLRC erred when it ruled to exclude the
issues on salary differential pay and unpaid overtime pay from being remanded for having failed
to raise these on appeal despite the fact that the relief being sought for as stated in its
Memorandum on Appeal praying to set aside the decision of the Honorable POEA
Administration and subsequent dismissal of the case which, for all intents and purposes included
all issues raised therein.

Petitioners: Contended that it was not able to discuss and refute claimants' money claims owing
to the fact that it did not have the documents to controvert the said claims; that it manifested
before the POEA such lack and sought time to secure the much needed documents; that at the
time the POEA rendered its decision, it still did not possess the said evidence; that it would have
been foolish for petitioner to include the issues on money claims on appeal and fabricate its
argument; that in its Supplemental Memorandum on Appeal, petitioner prayed for new trial
based on newly discovered evidence as an alternative remedy; that the prayer in the original
Memorandum on Appeal sought to reverse the Decision of January 15, 1989 and dismissal of
this case which was comprehensive enough to include the other issues on money claims; and that
it has no intention to deprive respondents of their money claims if the same are legitimate, valid
and deserving but that the payment must be done after considering all the evidence including the
documentary evidence it received from respondents' employer in Saudi Arabia.

Held:The petition has merit. In labor cases, the rules of evidence prevailing in courts of law or
equity are not controlling (Article 221, Labor Code). The law requires the Commission and its
members and the Labor Arbiters to use every and reasonable means to ascertain the facts in each
case speedily and objectively in the interest of due process. The essence of due process is to be
found in the reasonable opportunity to be heard and to submit any evidence one may have in
support of one's defense.
In the case, the requirements of due process was not fully met. Thus the supreme court orderes to
remand the entire case not just the issue on illegal dismissal to the POEA owing to the peculiar
circumstances of this case. The petitioners could hardly be faulted for the delayed transmittal of
the documents from Saudi Arabia. They did not sleep on their rights. Petitioners promptly
informed the POEA of their lack of evidence and inability to fully traverse the issues and
arguments raised against them. They had asked for time to get the necessary evidence but they
were not granted the opportunity.

HAVTOR MANAGEMENT PHILS., INC. v. NLRC and Emerlito Naroa

GR No. 146336
December 13, 2001 – MUÑOZ

FACTS: Emerlito Ranoa is the chief steward of Kvaerner Shipping A/S and C.F. Sharp & Co., a
foreign employer and manning agent of the vessel Hedda. Ranoa filed a disability benefit claim
against the company. While the case was pending, Havtor Management Inc. took over the
operations of Hedda as its local manning agent together with A/S Havtor Management as its
foreign principal. The Labor Arbiter ruled in favor of Ranoa ordering C.F Sharp Co., Inc. and
Havtor Management Philippines Inc. to pay solidarily a sum of US $53,300 with 10% of
attorney’s fees to Ranoa. Petitioners then went to the CA for relief but their petition for certiorari
was dismissed. The dismissal was anchored on their failure to attach to the petition a board
resolution showing that Rolando C. Adorable, President and General Manager of HMP Inc, who
signed the certification for non forum shopping was authorized by the company. Also, the CA
noted that no certificate of non-forum shopping was attached on behalf of A/S Havtor Mgmt.
They then filed an MR but it was also denied for lack of merit because it was indicated that
Adorable signed on behalf of Bergesen D.Y Phils and not on behalf of HMP. The petition failed
to mention that HMP already changed its name. Hence, this petition

ISSUE: Whether the case should be given due course despite the procedural lapses such as
the failure to state the change of name of the company and the failure to file a separate
certificate of non-forum shopping

RULING: Yes, the case should be given due course despite its procedural lapses. It is well
settled that the application of technical rules of procedure may be relaxed in labor cases to serve
the demands of substantial justice. Thus, in the interest of justice, procedural lapses may be
disregarded by the Court to allow an examination of the conflicting rights and responsibilities of
the parties in a case.
In compliance with the Court's resolutions, dated 13 August 2001 and 22 October 2001,
petitioners submitted to the Court pertinent documents certified by the Securities and Exchange
Commission showing its change of name from Havtor Management (Philippines), Inc. to
Bergesen D.Y. Philippines, Inc.The Court has reviewed the documents submitted by petitioner,
and it finds no reason to doubt that Havtor Management (Philippines), Inc. is the same as
Bergesen D.Y. Philippines, Inc., whose board of directors authorized Adorable to file the petition
before the Court of Appeals. The documents submitted by petitioners in compliance with the
Court's directive fully supported petitioners' contention as regards its change of name. The Court
notes that while petitioners may have initially failed to submit a secretary's certificate showing
that Adorable was authorized by the Havtor Management (Philippines), Inc.'s board of directors
to file the petition, they substantially complied with this requirement when they filed their
motion for reconsideration.

As regards the lack of a separate certificate of non-forum shopping for A/S Havtor Management,
it bears stressing here that it is a foreign principal that is acting only through its local manning
agent, that is, petitioner Havtor Management (Philippines), Inc. In view thereof, there is no need
for a separate certificate of non-forum shopping for A/S Havtor Management.

Hence, the petition is granted and is remanded to the CA for appropriate action.

DBP VS. NLRC - PADRIGO

Facts: November 14, 1986, private respondents filed with DOLE- Daet Camarines Norte, 17
individual complaints against Republic Hardwood Inc. (RHI) for unpaid wages and separation
pay. These complaints were thereafter endorsed to Regional Arbitration Branch of the NLRC
since the petitioners had already been terminated from employment.

RHI alleged that it had ceased to operate in 1983 due to the government ban against tree-cutting
and that in May 24, 1981, its sawmill was totally burned resulting in enormous losses and that
due to its financial setbacks, RHI failed to pay its loan with the DBP. RHI contended that since
DBP foreclosed its mortgaged assets on September 24,1985, then any adjudication of monetary
claims in favor of its former employees must be satisfied against DBP. Private respondent
impleaded DBP.

Labor Arbiter favored private respondents and held RHI and DBP jointly and severally liable to
private respondents. DBP appealed to the NLRC. NLRC affirmed LA’s judgment. DBP filed
M.R. but it was dismissed. Thus, this petition for certiorari.

Issue: Whether or not the Joint Decision of Executive Labor Arbiter Gelacio L. Rivera is
violative of procedural due process on the part of DBP

Held: DBP asserts that it was deprived of due process since there was no formal order
impleading it in the complaints against RHI. Moreover, DBP points out, the cases were never set
for hearing thus depriving it of the opportunity to peruse the documentary evidence of the
complainants and to confront the complainants' witnesses. Additionally, DBP was not given an
opportunity to present its own evidence.

There is no merit to this contention of DBP. Denial of due process means the total lack of
opportunity to be heard. There is no denial of due process where a party is given an opportunity
to be heard and to present his case. The petitioner in this case filed an opposition to the motion to
implead it as a party defendant. It likewise filed a motion for reconsideration of the labor arbiter's
decision. Thereafter, DBP filed an appeal with the NLRC and, later on, a motion for
reconsideration of the NLRC decision. The petitioner, thus, was given ample opportunity to
present its case. It was not denied due process.

Bantolino vs Coca-cola - PEÑA

FACTS: Sixty-two (62) employees of respondent Coca-Cola Bottlers, Inc., and its officers, filed
a complaint against respondents for unfair labor practice through illegal dismissal, violation of
their security of tenure and the perpetuation of the Cabo System. They thus prayed for
reinstatement with full back wages, and the declaration of their regular employment status.

Labor Arbiter Jose De Vera conducted clarificatory hearings to elicit information the
complainants averred that in the performance of their duties as route helpers, bottle segregators,
and others, they were employees of Coca-Cola Bottlers, Inc. Respondent company replaced them
and prevented them from entering the company premises, they were deemed to have been
illegally dismissed.

In lieu of a position paper, respondent company filed a motion to dismiss complaint for lack of
jurisdiction and cause of action, there being no employer-employee relationship between
complainants and Coca-Cola Bottlers, Inc., and that respondents Lipercon Services, Peoples
Specialist Services and Interim Services being bona fide independent contractors, were the real
employers of the complainants.

Labor Arbiter Jose De Vera rendered a decision ordering respondent company to reinstate
complainants to their former positions with all the rights, privileges and benefits due regular
employees, and to pay their full back wages which, with the exception of Prudencio Bantolino
whose back wages must be computed upon proof of his dismissal as of 31 May 1998, already
amounted to an aggregate of P1,810,244.00.

On appeal, the NLRC sustained the finding of the Labor Arbiter that there was indeed an
employer-employee relationship between the complainants and respondent company.
Respondent Coca-Cola Bottlers appealed to the Court of Appeals which, although affirming the
finding of the NLRC that an employer-employee relationship existed between the contending
parties nonetheless agreed with respondent that the affidavits of some of the complainants should
not have been given probative value for their failure to affirm the contents thereof and to undergo
cross-examination. As a consequence, the appellate court dismissed their complaints for lack of
sufficient evidence.

Contention of the Petitioner: Court of Appeals should not have given weight to respondents
claim of failure to cross-examine them. They insist that, unlike regular courts, labor cases are
decided based merely on the parties position papers and affidavits in support of their allegations
and subsequent pleadings that may be filed thereto.

Contention of the Respondent: affiants were not presented in court to affirm their statements,
much less to be cross-examined, their affidavits should, as the Court of Appeals rightly held, be
stricken off the records for being self-serving, hearsay and inadmissible in evidence.
ISSUE: Whether the Labor Arbiter and NLRC is bound to comply with the technicalities of law

RULING: NO. It was not necessary for the affiants to appear and testify and be cross-examined
by counsel for the adverse party. To require otherwise would be to negate the rationale and
purpose of the summary nature of the proceedings mandated by the Rules and to make
mandatory the application of the technical rules of evidence. Art. 221 of the Labor Code, the
rules of evidence prevailing in courts of law do not control proceedings before the Labor Arbiter
and the NLRC. Further, it notes that the Labor Arbiter and the NLRC are authorized to adopt
reasonable means to ascertain the facts in each case speedily and objectively and without regard
to technicalities of law and procedure, all in the interest of due process. We find no compelling
reason to deviate therefrom.

To reiterate, administrative bodies like the NLRC are not bound by the technical niceties of law
and procedure and the rules obtaining in courts of law.

FEU vs FEU-NRMF EMPLOYEES ASSOC.

G.R. No. 168362
October 12, 2006 – Saavedra

FACTS: FEU-NRMF, the employer, and its employees association entered into a CBA that would
expire on April 30, 1996. When that date came to a close, the association sent a letter to the
employer stating their economic and non-economic proposals for the negotiations of the new CBA.

But, the employer rejected the association’s demand due to financial constraints. They expressed
their intent to maintain the provisions of the old CBA. In order to compromise, conciliation was
conducted before the NCMB which subsequently failed.
The union filed a notice of strike on the ground of bargaining deadlock, and eventually conducted
such activity. To counter, the employer filed a Petition for the Assumption of Jurisdiction or for
Certification of Labor Dispute with the NLRC, underscoring the fact that it is a medical institution
engaged in the business of providing health care for its patients. Secretary of Labor granted the
petition and an assumed jurisdiction over the dispute, prohibiting any strike or lockout.

Francisco Escuadra, the NLRC process server, certified that, on September 5, 1996 at around 4:00
P.M., he attempted to serve a copy of the Assumption of Jurisdiction Order (AJO) to the union
officers but since no one was around at the strike area, he just posted copies of the said Order at
several conspicuous places within the premises of the hospital.

Because they did not know that the Secretary of Labor has already assumed jurisdiction over the
dispute, Striking employees continued holding a strike until 12 September 1996.

Secretary of Labor issued another Order directing all the striking employees to return to work and
the petitioner FEU-NRMF to accept them under the same terms and conditions prevailing before
the strike. A Return to Work Agreement was executed by the disputing parties.

Subsequently, petitioner FEU-NRMF filed a case before the NLRC, contending that respondent
union staged the strike in defiance of the AJO, hence, it was illegal. LA declared the strike illegal
and allowed dismissal of union officers for conducting the strike in defiance of the AJO.
Respondent union filed an Appeal before the NLRC. NLRC affirmed in toto the decision of the
LA. Respondent union filed MR, it was denied. Respondent union brought a Petition for Certiorari
before CA. CA granted the Petition and reversed the Resolutions of NLRC. Petitioner filed MR
but it was denied.

ISSUE: Was the service of AJO validly effected by the process server so as to bind the respondent
union and hold them liable for the acts committed subsequent to the issuance of the said Order?

HELD: Merely posting copies of the AJO does not satisfy the rigid requirement for proper service
outlined by the above stated rules. Needless to say, the manner of service made by the process
server was invalid and irregular.

Under the NLRC Revised Rules of Procedure, service of copies of orders should be made by the
process server either personally or through registered mail. However, due to the urgent nature of
the AJO and the public policy underlying the injunction carried by the issuance of the said Order,
service of copies of the same should be made in the most expeditious and effective manner, without
any delay, ensuring its immediate receipt by the intended parties as may be warranted under the
circumstances. Thus, personal service is the proper mode of serving the AJO.

Personal service effectively ensures that the notice desired under the constitutional requirement of
due process is accomplished. If, however, efforts to find the party concerned personally would
make prompt service impossible, service may be completed by substituted service, that is, by
leaving a copy, between the hours of eight in the morning and six in the evening, at the party’s or
counsel’s residence, if known, with a person of sufficient age and discretion then residing therein
(RULE 12 of Rev Rules of Court).

Substituted service derogates the regular method of personal service. It is therefore required that
statutory restrictions for effecting substituted service must be strictly, faithfully and fully observed.
Failure to comply with this rule renders absolutely void the substituted service along with the
proceedings taken thereafter. The underlying principle of this rigid requirement is that the person,
to whom the orders, notices or summons are addressed, is made to answer for the consequences of
the suit even though notice of such action is made, not upon the party concerned, but upon another
whom the law could only presume would notify such party of the pending proceedings.

In the case at bar, presumption of receipt of the copies of the Assumption of Jurisdiction Order
AJO could not be taken for granted considering the adverse effect in case the parties failed to heed
to the injunction directed by such Order. Defiance of the assumption and return-to-work orders of
the Secretary of Labor after he has assumed jurisdiction is a valid ground for the loss of
employment status of any striking union officer or member. Employment is a property right of
which one cannot be deprived of without due process. Due process here would demand that the
respondent union be properly notified of the Assumption of Jurisdiction Order of the Secretary of
Labor enjoining the strike and requiring its members to return to work. Thus, there must be a clear
and unmistakable proof that the requirements prescribed by the Rules in the manner of effecting
personal or substituted service had been faithfully complied with.
Respondent union could not therefore be adjudged to have defied the said Order since it was not
properly apprised thereof. Accordingly, the strike conducted by the respondent union was valid
under the circumstances.

NASIPIT LUMBER CO. VS NLRC - TOYOKEN

FACTS: Nasipit Lumber Company, Inc (NALCO) employed Juanito Collado as a security guard
on September 9. 1970. During his employment, four crates of lawanit boards containing 1,000
panels were stolen from NALCO’s premises. He was implicated for theft and was placed under
preventive suspension. On September 8, 1976, NALCO filed a petition for clearance to dismiss
Collado with the Regional Office of the DOLE in Cagayan de Oro City. Collado opposed the
petition. The case was then set for hearing on September 16, 1976, but Collado, despite due
notice, failed to appear. NALCO was allowed to present evidence ex-parte. On October 12,
1976, the petition was approved. Collado filed a motion for reconsideration on the ground that he
was not given an opportunity to rebut the false findings or adduce evidence on his
favor. Roughly two months after, the case was referred to the Executive Labor Arbiter for
compulsory arbitration however, after a perusal of records, the Labor Arbiter returned the case to
the Regional Director for whatever appropriate action he may deem fit.
Consequently, it was referred to the Sec of Labor where the Acting Secretary issued an order
affirming the application for clearance to dismiss Collado. Collado then filed a complaint before
the Butuan District Labor Office for unjust dismissal and reinstatement with backwages and
benefits. NALCO then filed a Motion to Dismiss on the ground that Collado has no sufficient
cause of action and that the decision of the Acting Labor Secretary had become final and
executory, hence there is res judicata. Again, the case was referred to the Executive Labor
Arbiter for compulsory arbitration and this time, the Exec LA decided that NALCO should
reinstate Collado to his former position without backwages and without loss of his seniority
rights. This prompted both parties to the NLRC wherein NALCO asked for the reversal and
revocation of the decision of the Exec LA, while Collado prayed for a modification of the
appealed decision to include backwages and benefits in addition to reinstatement. The NLRC
rendered a decision modifying the Exec LA’s decision by ordering Collado’s reinstatement with
two years backwages without qualification and loss of seniority rights. Hence, NALCO filed a
petition for certiorari and prohibition with prayer for the issuance of a writ of preliminary
injunction and/or a restraining order seeking to annul the NLRC decision and to prohibit its
execution. The SC dismissed the case for lack of merit but, NALCO filed an urgent motion for
reconsideration to which Collado opposed.

ISSUES:
1. Is the principle of res judicata applicable in labor relations proceedings?
2. Is the decision of the NLRC to reinstate Collado with back wages and without loss of seniority
rights valid?

RULING:
1. No, it is not applicable in labor relations proceedings considering that the IRR of the Labor
Code provides that such proceedings are “non-litigous and summary in nature without regard to
legal technicalities obtaining in courts of law.” This is in consonance with the dictum that the
doctrine of res judicata applies only to judicial and quasi-judicial proceedings and not to the
exercise of administrative powers.
2. No, the NLRC abused its discretion in directing his reinstatement with two years backwages.
The relation between NALCO and Collado is now strained by Collado’s violation of the trust
and confidence reposed upon him as a member of the security force. Proof beyond reasonable
doubt of an employee’s misconduct is not required when loss of confidence is the ground for
dismissal. It is sufficient if the employer has “some basis” to lose confidence or that the
employer has reasonable ground to believe or to entertain the moral conviction that the employee
concerned is responsible for the misconduct and that the nature of his participation therein
rendered him absolutely unworthy of the trust and confident demanded by his position.

PHILIPPINE NATIONAL CONSTRUCTION CORPORATION (PNCC) vs. DIRECTOR

PURA FERRER-CALLEJA, RASIDALI C. ABDULLAH, ENFORCEMENT UNIT NCR
ARBITRATION BRANCH, REYNALDO SANTOS, ET AL. ,
167 SCRA 294 – ALDEN

FACTS: The 388 private respondent are employees of petitioner who are members of the PNCC
Tollways and Workers Union. The union engaged the services of Atty. Emmanuel Clave as labor
advocate, negotiator and adviser with compensation of 10% on any arbitration award, settlement,
collective bargaining agreement (CBA) negotiation gains, plus expenses in the performance of his
responsibilities. Negotiation fee payable to Atty. Clave was lowered from 10% to 5%. Union
resolutions were passed providing that fee’s payable to Atty. Clave will be subject to check-off
arrangement with the PNCC and directing it’s members to execute check-off authorization.

Relaying on the union’s resolution PNCC deducted special assessment fees from all union
members. However, respondent alleged that they did not comply with the check off authorization
hence, PNCC is not authorized to deduct from their salaries. On July 11, 1985, the 388 private
respondents, members of the then CDCP Union, now PNCC Employees and Workers Union, filed
a petition with the National Capital Region Director of the Department of Labor and Employment
(DOLE) against their own union officers and the petitioner. They asked that a temporary
restraining order enjoining their employer from further collecting special assessments from salaries
of union members, declaring resolutions of executive board of the union null and void and ordering
PNCC and/or union officers to return the amount already deducted.

Mid-Arbiter set the hearing of the case but PNCC was not able to file any pleadings in the hearing
of the case and was not able to present it side. Med-Arbiter issued an order declaring the questioned
Resolution null and void and to the effect ordered PNCC to stop collecting special assessment
against union members’ salaries. He likewise ordered thence and the union, jointly severally return
to the employees concern the amount deducted from their salaries.

On November 5, 1986, Public respondent BLR Director Pura Ferrer-Calleja issued a writ of
execution, directing the Enforcement Unit of the NCR Branch to collect from petitioner-employer
and/or the CDCP Union the sum of P257,400.00, the total amount of deductions made against the
salaries of the employees, or to satisfy said amount from the movable or immovable properties of
the petitioner and/or union which are not exempt from execution. Petitioner now questions the said
order of public respondents contending that there was a denial of petitioner’s right to due process
of law when it ordered the writ of execution because they were not duly informed of the case filed
against them. It also questions the jurisdiction of BLR.i
ISSUE: Whether the Bureau of Labor Relation has jurisdiction over cases involving employers or
only for matters involving disputes between and among the union, its officers and members? Will
the summons served upon minor employees binding upon the employer?

HELD: On the issue of jurisdiction, yes, the Court has jurisdiction over the controversy. Under
Article 241 of the Labor Code, the Bureau of Labor Relations has jurisdiction over cases of
reported violations thereof and to mete the appropriate penalty in disputes between and among the
union, its officers and members. The petition was for violation of said article which provides that
"(n)o special assessment or other extraordinary fees may be levied upon the members of a labor
organization unless authorized by a written resolution of a majority of all the members at a general
membership meeting duly called for the purpose. ..."

On the second issue, the court ruled that the service of summons upon the minor subordinates of
petitioner's Tollways Division is not valid and binding. Under Section 15, Rule 14 of the Rules of
Court, service of summons upon public corporations must be made on its executive head or on
such officer or officers as the law or the court may direct. Under Section 13 of the same Rule,
service upon a private corporation may be made on the president, manager, secretary, cashier,
agent or any of its directors. The court also took judicial notice that the political upheaval of 1986
affected the petitioner as government-controlled corporation. The defective service of summons
prevented the pending case from being brought to the attention of petitioner's Legal Department.
The eloquent non-appearance of petitioner in all the hearings establishing a money claim against
it is an indication of lack of sufficient notice regarding the case. It came to know of the case only
when the judgment against it was being executed. Notice to enable the other party to be heard and
to present evidence is not a mere technicality or a trivial matter in any administrative or judicial
proceedings. The service of summons is a very vital and indispensable ingredient of due process.
With that, restraining order issued by the Supreme Court was made permanent.

Galvadores vs. Trajano- APOLONIO

Facts: Petitioner employees of PLDT and members of respondent Free Telephone Workers Union
(Union), question the legality of the check-off for attorney's fees amounting to P1M, more or less,
of respondent Atty. Jose C. Espinas (hereinafter referred to as "Respondent Counsel") from the
monetary benefits awarded to PLDT employees in a deadlocked collective bargaining agreement
negotiations between the PLDT and the Union.

The case stemmed from the following facts: Atty. Espinas hired on a case to case by the Union on
contingent fee basis. He received a letter from the Union President reading:
The Free Telephone Workers Union once again request you to appear as counsel in the on going
labor dispute at PLDT. In consideration of your services therein, the union binds itself to
compensate you for your fees and expenses therein on a contingent basis. The amount shall be
10% of any improvement, with retroactive effect, of the PLDT's last offer to the deadlock in CBA
negotiations which we know will result in a compulsory arbitration. A supporting board resolution
will later confirm the letter.
The Minister of Labor and Employment assumed jurisdiction over all unresolved issues in the
bargaining deadlock and proceeded to resolve the same by compulsory arbitration.
o Minister of Labor awarded across-the-board wage increases in addition to the Christmas bonus
of 1/2 month pay per employee and other fringe benefits. As will be noted, there were
improvements obtained from PLDT's "last offer."
The Executive Board of the Union passed a resolution requesting PLDT to deduct P115.00 per
employee for the legal services extended by Atty. Espinas.
Employees, initially numbering 600 and finally 5,258, filed a letter-complaint before the MOLE
through their authorized representative, Galvadores, assailing the imposition of P130.00 (later
corrected to P155.00) per employee as attorney's fees of respondents counsel.

Employees took the position that the attorney's fees were not only unreasonable but also violative
of Article 242(o) of the Labor Code; and that the deductions cannot given legal effect by a mere
Board resolution.

o Union and Counsel, on the other hand, proferred the argument that the attorney’s fees being
exacted pertained to his services during compulsory arbitration proceedings and cannot be
considered as negotiation fees or attorney's fees within the context of Article 242(o) of the Labor
Code.

Employees proposed a solution offering to pay P10/employee, but Atty. Espinas refused.

In the meantime, PLDT filed notice that assessment had been withheld from the differential pay
due petitioners but that the same would not be turned over to the Union without prior MOLE
authority so as not to involve management in the intra-union disagreement.

The Minister of Labor referred the dispute to the Bureau of Labor Relations for being intra-union
nature. Several hearings were held by that Bureau.

The Union filed a Manifestation to the effect that about 6,067 members of the Union ratified the
resolution of the legislative council in a plebiscite called for that purpose. On the basis thereof,
Counsel moved for the payment of his legal fees.

The employees questioned the plebiscite on the ground that Question No. 2, which reads:
Question No. 2. Do you approve of the use of P1 million (P500,000.00 to be withdrawn from
PECCI and another P500,000.00 from IBAA) from our CBA negotiation fund together with the
attorney's fees (P1 million) that was collected and to be loaned to the MKP/FTWU as our
counterpart of the seed money to start the housing program as agreed by the PLDT management
and our union panel and included in the award of the MOLE?

was misleading and deceptive as it assumed that there was no dispute regarding the deduction of
attorney's fees from the monetary benefits awarded to PLDT employees.

Director of the Bureau of Labor Relations dismissed employees' complaint for lack of merit
reasoning that "the outcome of the plebiscite negates any further question on the right of the union
counsel to collect the amount of P115 from each of the employees involved."

This Decision that is assailed by petitioners principally on the ground that the individual written
authorization of an the employees must first be obtained before any assessment can be made
against the monetary benefits awarded to them pursuant to Article 242(o) of the Labor Code; and
that assuming that Respondent Counsel is entitled to attorney's fees, the same should be taken from
Union funds.

MUnion and Counsel argue that compulsory arbitration is a "mandatory activity" and an exception
to Article 242(o) of the Labor Code, and that the Union members approved the questioned
deduction in the plebiscite of January, 1984, under the condition that P lM of the same would be
made available for the Union's housing project.

Issue: WON the compulsory arbitration is a “mandatory activity”

Held: NO. The provisions are clear. No check-offs from any amounts due employees may be
effected without individual written authorizations duly signed by the employee specifically stating
the amount, purpose and beneficiary of the deduction. The required individual authorizations in
this case are wanting. In fact, petitioner employees are vigorously objecting. The question asked
in the plebiscite, besides not being explicit, assumed that there was no dispute relative to attorney's
fees.

Relevant provisions:
Article 222(b) of the Labor Code provides:
Article 222. Appearance and Fees.
(b) No attorney's fees, negotiation fees or similar charges of any kind arising from any collective
bargaining negotiations or conclusion of the collective bargaining agreement shall be imposed on
any individual member of the contracting union; Provided, however, that attorney's fees may be
charged against union funds in an amount to be agreed upon by the parties. Any contract,
agreement or arrangement of any sort to the contrary shall be null and void.

Article 242 of the same Code reads:

o Art. 242. Rights and conditions of membership in a labor organization. The following are the
rights and conditions of membership in a labor organization:

Other than for mandatory activities under the Code, no special assessment, attorney's fees,
negotiation fees or any other extraordinary fees may be checked off "from any amount due an
employee without individual written authorization duly signed by the employee. The authorization
should specifically state the amount, purpose and beneficiary of the deduction.

The Omnibus Rules Implementing the Labor Code also provide that deductions from wages of the
employees may only be made by the employer in cases authorized by law, including deductions
for insurance premiums advanced by the employer on behalf of the employees as well as union
dues where the right to check-off is authorized in writing by the individual employee himself.
Contrary to Union's and Counsel's stand, the benefits awarded to PLDT employees still formed
part of the collective bargaining negotiations although placed already under compulsory
arbitration. This is not the "mandatory activity" under the Code which dispenses with individual
written authorizations for check-offs, notwithstanding its "compulsory" nature. It is a judicial
process of settling disputes laid down by law. Besides, Article 222(b) does not except a CBA, later
placed under compulsory arbitration, from the ambit of its prohibition. The cardinal principle
should be borne in mind that employees are protected by law from unwarranted practices that
diminish their compensation without their knowledge and consent.

Decision rendered by Director of the Bureau of Labor Relations SET ASIDE. The attorney's fees
herein involved may be charged against Union funds pursuant to Article 222(b) of the Labor Code,
as may be agreed upon between them.

WILSON ABA vs. NLRC and ALFONSO VILLEGAS - BAUCAS

Facts: WILSON ABA filed against Hda. Sta. Ines and/or Alfonso Villegas a complaint for illegal
dismissal, legal holiday pay, premium pay on holiday and rest day, service incentive leave pay,
separation pay, and salary and 13th month differentials.

Aba claimed he worked at Hda. Sta. Ines from 26 December 1976 until his termination on 27
August 1990 due allegedly to his union activities.

Hda. Sta. Ines and Villegas claimed That there was no employee-employer relationship.

The NLRC dismissed Aba’s appeal for non-payment of the appeal docketing fee. Aba timely filed
his Motion for Reconsideration together with the appeal docketing fee.

Issue:
Is delay in paying the appeal docketing fee fatal in the appeal?

Ruling: No appeal bond was necessary as the decision being appealed did not contain any monetary
award. The appeal in the instant case has been perfected and the failure to pay the appeal docketing
fee is not fatal. Technical rules of evidence are not binding in any proceedings before the
Commission or any of the labor arbiters.

Appeal means the elevation by an aggrieved party of any decision or award of a lower body to a
higher body by means of a pleading which includes the assignment of errors, arguments in support
thereof, and the reliefs prayed for. Perfection of an appeal includes the filing, within the prescribed
period, of the memorandum of appeal containing the assignment of errors, arguments, the relief
sought and, posting of the appeal bond. An appeal bond is necessary only in case of a judgment
involving a monetary award. The appeal may be perfected only upon the posting of a cash or surety
bond issued by a reputable bonding company duly accredited by the Commission in the amount
equivalent to the monetary award in the judgment appealed from.

Aba is even excused from paying docket fees pursuant to Art. 277, par. (d), of the Labor Code
which provides that no docket fee shall be assessed in labor standards disputes, and the instant case
is a labor standards dispute as it involves not only the issue of illegal dismissal but also payment
of legal holiday pay, premium pay on holiday and rest day, service incentive leave pay, separation
pay, salary and 13th month differentials.

ABBOTT and ALUNAN vs NLRC

G.R. No. L-651753
October 27, 1986 - BAUTISTA

FACTS: Abbott and Alunan, the petitioners, were agency managers of Travellers Life Assurance
of the Philippines, Inc. They were terminated on August 16, 1977 without a written clearance. So,
they went to the Department of Labor to file a complaint for illegal dismissal against their former
employer.

The Labor Arbiter Agbuya rendered a decision granting money award to the petitioners and
ordering their reinstatement. An appeal to the judgment was filed with the NLRC, which the latter
affirmed. The employer filed a motion for reconsideration on January 26, 1982 which was denied
on March 24, 1982. 86 days later, petitioners filed a motion for execution and recomputation of
their money claims. Travellers Life opposed through a petition for certiorari. On a second motion
for execution, the petitioners argued that the decision of the NLRC is final and executor so the
employer’s opposition was improper.

Despite all this, the labor arbiter took cognizance of the employer’s opposition but dismissed it
subsequently maintaining petitioner’s argument that the decision was final and executory.
However, adjustments were also made to the award of money to be given to the dismissed
employees in this case.

Thus, the labor arbiter’s decision was appealed to the NLRC. The NLRC acted upon the appeal
and issued a restraining order over the enforcement of the original decision by the arbiter which it
approved.

So, the petitioners now question whether it was proper for the NLRC to take cognizance of the
appeal when the Labor Arbiter’s decision is final and executory.

ISSUE: Did the NLRC commit grave abuse of discretion amounting to lack or excess of
jurisdiction when it took cognizance of the appeal and issued a restraining order?
HELD: The National Labor Relations Commission has the authority to look into the correctness
of the execution of the decision in this case and to consider the supervening events that may affect
such execution, like the possible set-off of the petitioners’ advances or debts against their total
claim, their discontinuance from employment by abandonment or resignation, and other relevant
developments.

While it is true that the decision itself has become final and executory and so can no longer be
challenged, what is sought to be reviewed is not the decision itself but the manner of its execution.
The decision must be enforced in accordance with its terms and conditions. Any deviation
therefrom, such as the adjustment of the awards in this case, can be the subject of a proper appeal.

G.R. No. L-58011 & L-58012 November 18, 1983

VIR-JEN SHIPPING AND MARINE SERVICES, INC., petitioner,
vs.
NATIONAL LABOR RELATIONS COMMISSION, ROGELIO BISULA RUBEN
ARROZA JUAN GACUTNO LEONILO ATOK, NILO CRUZ, ALVARO ANDRADA,
NEMESIO ADUG SIMPLICIO BAUTISTA, ROMEO ACOSTA, and JOSE ENCABO
respondents. - CABIGTING

FACTS:
1. The Seamen entered into separate contracts of employment with the Company, engaging them
to work on board M/T' Jannu for a period of twelve (12) months.
2. Rogelio H. Bisula,(respondent) received a cable from VIR-JEN SHIPPING AND MARINE
SERVICES, INC., advising him of the possibility that the vessel might be directed to call at ITF-
controlled ports and at the same time informing him of the procedure to be followed in the
computation of the special or additional compensation of crew members while in said ports.
(ITF is the acronym for the International Transport Workers Federation, a militant international
labor organization with affiliates in different ports of the world)
3. On 22 March 1979, the VIR-JEN SHIPPING AND MARINE SERVICES, INC., sent another
cable to respondent Bisula, this time informing him of the respective amounts each of the officers
and crew members would receive as special compensation when the vessel called at the port of
Kwinana Australia, an ITF-controlled port. This was followed by another cable on 23 March 1979,
informing him that the officers and crew members had been enrolled as members of the ITF in
Sydney, Australia, and that the membership fee for the 28 personnel complement of the vessel had
already been paid.
4. The following day, shipmaster Bisula cabled Vir-jen stated that the officers and crews were not
interested in ITF membership and their demand was a 50 percent increase based on their then
salaries.
5. In reply, Vir-jen counter proposed a 25 percent increase.
6. Only after Kyoei Tanker Co., Ltd., declined to increase the lumps sum amount given monthly
to Vir-jen was the decision to terminate their employment formulated.
7. A complaint for illegal dismissal and non-payment of earned wages with the National Seamen
Board was filed.
8. The NSB rendered a decision declaring that the seamen breached their employment contracts
when they demanded and received from Vir-jen Shipping wages over and above their contracted
rates. Also the dismissal of the seamen was declared legal.
9. The seamen appealed the decision to the NLRC which reversed the decision of the NSB and
required the petitioner to pay the wages and other monetary benefits corresponding to the
unexpired portion of the manning contract on the ground that the termination of the contract was
without valid cause.

ISSUE: whether or not the seamen violated their contracts of employment

HELD: The form contracts approved by the National Seamen Board are designed to protect
Filipino seamen not foreign ship owners who can take care of themselves.
The standard forms embodies the basic minimums which must be incorporated as parts of the
employment contract. They are not collective bargaining agreements or immutable contracts which
the parties cannot improve upon or modify in the course of the agreed period of time. To state,
therefore, that the affected seamen cannot petition their employer for higher salaries during the 12
months duration of the contract runs counter to established principles of labor legislation. The
National Labor Relations Commission, as the appellate tribunal from decisions of the National
Seamen Board, correctly ruled that the seamen did not violate their contracts to warrant their
dismissal.

FLEXO MANUFACTURING VS NLRC - CARLOS

FACTS: Petitioner Flexo Manufacturing Corporation is a business firm engaged in the
manufacture and printing of packaging materials for goods and merchandise. Private respondent
Virgilio M. Mantes, upon the other hand, was employed by petitioner as its slitting machine
operator

Private respondent failed to report for work having been stricken with influenza. He was supposed
to report for work in the night of said date, as he was at that time with the night shift. In the
morning, however, of that day, he requested Cristeno Magrata, a fellow worker, to deliver his
handwritten note to the management informing them of his inability to report for work due to
illness. The letter was given by Magrata to Armando Buenaventura, the foreman of private
respondent

Private respondent went to Flexo to report for work, bringing with him a medical certificate issued
by Dr. Josefina Merano of the Caloocan Health Department. As it was the procedure of Flexo
Manufacturing Corporation that before an employee who was absent could be actually allowed to
work, he must first secure a sort of an excuse slip from both the Personnel and Production
Managers, private respondent Mantes presented the medical certificate to Mr. Robert Chan, the
Production Manager and Mr. Norberto Enciso, the Personnel Manager, both of whom refused to
give the required excuse slip despite private respondent's plea that he be allowed to report back for
work. Since then, private respondent was not allowed to work.

Private respondent received thru the mail, a xerox copy of a clearance application filed by
petitioner, stating therein that private respondent was terminated effective on the ground of
abandonment

Private respondent opposed petitioner's clearance application by filing a complaint

Labor Arbiter Ricarte T. Soriano rendered a decision giving due course to petitioner's application
for clearance to terminate the services of private respondent and dismissing the latter's complaint
for illegal dismissal.

Private respondent appealed the aforesaid decision to the National Labor Relations Commission,
reversing the ruling of Labor Arbiter Ricarte T. Soriano.

the instant petition for certiorari with preliminary injunction, petitioner contending that respondent
NLRC acted with grave abuse of discretion and/or without jurisdiction that it was never duly
served with a copy of the notice of appeal

ISSUE: Whether the decision of NLRC is proper

RULING: In the case at bar, even if petitioner was not able to participate in the proceedings before
respondent NLRC, it could not have been unduly prejudiced because no additional arguments or
evidence were received. In deciding private respondent's appeal, the NLRC relied on the very same
evidence and arguments presented before the labor arbiter which included the position paper,
affidavits and other supporting documents submitted by the petitioner. Private respondent's appeal
did not raise new issues. It was anchored on practically the same grounds and the issues raised and
discussed were likewise the same as those in the proceedings before the Labor Arbiter and which
the petitioner had all the opportunity to refute. In fact, the Labor Arbiter's findings of fact were
adopted by respondent NLRC in its questioned decision, although the latter drew therefrom a
different legal conclusion. It has been ruled that "there is no denial of due process if the decision
is based on evidence adduced at the hearing or at least contained in the records.”

Neither can private respondent validly complain that it has been denied the right to due process by
having been allegedly deprived of the opportunity to answer petitioner's appeal on account of the
latter's failure to furnish the former with copy of his memorandum of appeal. Since the entire
record of the case on appeal is open for review by the NLRC, the absence of an answer or
opposition to the appeal would not really have a significant bearing on the adjudication of the case,
as would otherwise perhaps constitute a denial of private respondent's right to due process.
Moreover, the dismissal of an employee's appeal on a purely technical ground is inconsistent with
the constitutional mandate on protection to labor. Where the rules are applied to labor cases, the
interpretation must proceed in accordance with the liberal spirit of the labor laws. As this Court
said in Estrada vs. NLRC 17

CURAZA V. NLRC - DONATO

On September 18, 1989, petitioner filed a complaint against respondent Pepsi-Cola Products
Philippines, Inc. (PEPSI) for constructive dismissal with the Sub-Regional Arbitration Branch
(SRAB) No. X in Butuan City. The complaint included claims for reinstatement, backwages, moral
damages and exemplary damages.
Curaza alleged that:
1. he has been employed as Butuan Plant Personnel Manager of the Pepsi Cola Bottling
Company of the Philippines on 16 November 1981, was absorbed as such by the Pepsi Cola
Distributors of the Philippines, Inc. on 25 March 1985, and was finally transferred to respondent
Pepsi Cola Products Philippines, Inc.
2. that respondent PCPPI thru its Plant General Manager relieved complainant of his
official function as the Plant Personnel Manager without any valid reason or legal basis and
padlocked the office of the latter to prevent him from getting inside to discharge his duties and
responsibilities as such;
3. that complainant has been reporting to the plant daily without any work load or
assignment and worse is the fact that he was subjected to a close security inspection during time
in and out and close security surveillance while inside the plant premises
4. that complainant was placed in a very embarrassing condition of employment that will
unquestionably affect his well-being which may lead separation from service
5. that complainant has been and is still suffering from sleepless nights, mental anguish,
fright, serious anxiety, besmirched reputation, wounded feelings, moral shock and social
humiliation.
Respondents in its answer alleged that:
that respondent PCPPI has a separate and distinct legal personality from Pepsi Cola
Bottling Company of the Philippines, Inc. and Pepsi Cola Distributors of the Philippines;
1. that complainant was legally separated from Pepsi Cola Distributors of the
Philippines, Inc.
2. respondent PCPPI offered him employment as Plant Personnel Manager of
Butuan Plant;
3. that complainant was not in any manner relieved of his official function as
Plant Personnel Manager by respondent PCPPI or any of its responsible officials;
4. that beginning September 2 to September 16, 1989, complainant had not
been reporting to his work daily or regularly, without proper leave notification
to the Plant General Manager;
5. that worse, starting September 18, 1989, complainant absented himself from
his work, and continuing thereafter again without leave notification whatsoever
to the Plant Management;
6. his irregular attendance and/or repeated absences of complainant in his work and
considering that his personnel office is the repository of confidential and highly
sensitive documents, the Plant Management deemed it proper and wise, as
precautionary measure, to have his office properly secured;
The LA dismissed the complaint
On May 25, 1990, Labor Arbiter Amado M. Solamo rendered his decision dismissing petitioners
complaint but on account of equitable considerations ordered respondent PEPSI to pay petitioner
financial assistance equivalent to one (1) month salary. Then Curaza filed a manifestation that he
be counsel along with his attorney.
Appeal
On June 15, 1990, petitioner filed an appeal of the decision with the NLRC.
NLRC
On April 29, 1991, the NLRC dismissed petitioners appeal on the ground that the decision of the
Labor Arbiter was final and executory since the appeal of petitioner was filed beyond the ten (10)
day period for perfecting an appeal.
3 months later, Curaza filed his motion for reconsideration, which was denied for being filed
beyond the 10 day period. He now argues that he only received the notice of the decision a few
days before he filed his motion and since he is also counsel he is entitled to notice ands that the 10
day period starts from when he received the notice.
ISSUE: W/N he is entitled to notice and when does the 10 day period start.
HELD: The SC ruled that Curaza is not entitled to notice. He was still represented by his lawyer
and since the NLRC rules of procedure have no specific rule, the Rules of Court apply apparently
and it provides that where a person is represented by more than one counsel, service upon one is
considered service to all unless personal notice is ordered by the Court. Also since his lawyer
received the notice 3 months earlier the 10 day period starts from the date. The NLRC rules of
procedures provide that notices of decisions shall be served upon the counsel of record. The failure
of the council binds the client and is not a ground for setting aside a judgment that is valid and
regular on its face.

IMPERIAL TEXTILE MILLS Inc. vs. NLRC - DULNUAN

Angie Mendoza had been employed by Imperial Textile. In the latter part of 1986, a new
management group took over the company. Mendoza who was on leave found out about the
changes and consequently wrote the widow of the former president. During the change of
management, Mendoza’s position (Personnel Manager) was filled up by a new comer. In her letter,
she stated that given her circumstances, it would be proper to cease her employment.
Thereafter, Mendoza filled a complaint for illegal dismissal. In its defense, Imperial Textile
averred that Mendoza voluntarily resigned and if she was terminated such termination was due to
valid and just grounds.
Thereafter, the parties submitted their respective position papers. Imperial Textile then filed a
Motion to Dismiss alleging that:
(1) private respondent’s position paper is unverified and should be stricken off the
record; and
 (2) complainant failed to appear despite notice, thereby depriving petitioner of its
right to cross-examine her.
The labor arbiter dismissed the complaint without prejudice, on the ground that complainant’s
absence deprived herein petitioner of the opportunity to cross examine her. The NLRC reversed
LA’s decision stating that the commission and the labor arbiter have the authority to decide cases
based on position papers and documents submitted by the parties without resorting to technical
rules of evidence; and that herein petitioner was not denied due process because on the basis of
the records of the case, an intelligent decision could be arrived at without resorting to a formal
hearing.
ISSUES and RULING:
1. WON Imperial Textile was denied due process.
a. No. It is a basic rule that it is not the denial of the right to be heard but the
deprivation of the opportunity to be heard which constitutes a violation of the due process
clause. There was sufficient compliance with the requirement of due process as petitioner
was given the opportunity to present its case through a motion to dismiss and a position
paper filed with the labor arbiter.
2. WON an unverified position paper would have an adverse effect to the decision rendered by
the Labor Arbiter.
a. NO. The unverified position paper is a mere procedural infirmity which does
not affect the merits of the case. well-settled is the rule that procedural technicalities do not
strictly apply to proceedings before labor arbiters for they may avail themselves of all
reasonable means to speedily ascertain the facts of a controversy
3. WON the late filing of Plaintiff(s)’ appeal is detrimental to the decision rendered.
a. Records show that the decision of the labor arbiter was received by private
respondent on May 2, 1990, whereas the appeal was filed with respondent commission
only on May 17, 1990, which is already beyond the 10-day reglementary period provided
in the Labor Code.
b. The general rule is that the perfection of an appeal in the manner and within the period
prescribed by law is not only mandatory but jurisdictional. Failure to conform to the rules
will render the judgment sought to be reviewed final and unappealable.
c. Nevertheless, in some instances, this Court has disregarded such unintended
lapses so as to give due course to appeals filed beyond the reglementary period on the basis
of strong and compelling reasons, such as serving the ends of justice and preventing a grave
miscarriage thereof. We are of the opinion and so hold that in consideration of the merits
of this case, substantial justice could be rightfully invoked by way of an exception. This is
one such case where we are convinced that substance should prevail over and not be
sacrificed for form.
4. WON LA erred in awarding separation pay since complainant is already employed elsewhere.
a. NO. The payment of backwages is one of the reliefs which an illegally
dismissed employee prays the labor arbiter and the National Labor Relation Commission
 to render in his favor as a consequence of the unlawful act committed by the employer. The
award thereof is not private compensation or damages but is in furtherance and effectuation
of the public objectives of the Labor Code. Even though the practical effect is the
enrichment of the individual, the award of backwages is not in redress of a private right,
but, rather, is in the nature of a command upon the employer to make public reparation for
his violation of the Labor Code

SM AGRI AND GENERAL MACHINERIES, vs. NLRC- FOLLANTE

FACTS: Vivencio Abo was first employed on 2 August 1976 by SM Industries as Officer-in-
Charge (OIC) of a branch office. In 1981, SM Industries changed its business name into SM
Agricultural and General Machineries where Mr. Abo remained, to work as an OIC, until his
termination from employment on 31 May 1982.Respondent charged petitioner for unlawful
dismissal and prayed for an award of damages.The Labor Arbiter, on 29 March 1984, rendered a
decision in favor of private respondent.From said decision, petitioner filed an appeal on the
grounds that there are serious errors in the findings of fact, excessive award of money claims and
lack of authority to award damages.
The NLRC dismissed petitioner's appeal on the ground that it was filed out of time.
Respondent's counsel, Atty. Rolando L. Bobis, expressly admitted that he received a copy of the
decision on 10 April 1984, while the appeal was only filed thru registered mail on 23 April 1984,
or a period of thirteen (13) days.

According to petitioner, it was physically impossible to file the appeal on 20 April 1984 either
personally or by registered mail, since it was Good Friday, a Legal Holiday. Such being the case,
he filed the appeal on 23 April 1984 (Monday) which was the first business day after the Legal
Holiday. Petitioner, while admitting that he filed the appeal on the 13th day, argued that the
computation of the 10-day period requirement should not be strictly applied to this case. NLRC,
however, denied petitioner's motion for reconsideration in its 7 April 1986 resolution. Hence, this
present recourse by the petitioner.

ISSUE: Whether or not the NLRC committed grave abuse of discretion in dismissing petitioner's
appeal on the ground of tardiness or late filing.

HELD: Public respondent NLRC cites the case of Vir-Jen Shipping and Marine Services v. NLRC
7 in its 29 November 1985 resolution. This Court reiterates the doctrine enunciated in said case
that the 10-day period provided in Art. 223 of the Labor Code refers to 10 calendar days and not
10 working days. This means that Saturdays, Sundays and Legal Holidays are not to be excluded,
but included, in counting the 10-day period. This is in line with the objective of the law for speedy
disposition of labor cases with the end in view of protecting the interests of the working man.
The ruling in the Vir-Jen Shipping case does not however apply to the case at bar. This is not a
case of a Legal Holiday falling within the period, between the day when the decision appealed
from was received and the last day to appeal or the 10th day. Instead, we have here a case where
the Legal Holiday is coincidentally the 10th or the last day to appeal. NLRC's contention that
petitioner's appeal was filed out of time because 20 April was the last day to file the appeal, and a
Legal Holiday is deemed included in the computation of the 10-day reglementary period, is
untenable. Sec. 31, Art. VIII of the Revised Administrative Code, and not the case of Vir-Jen
Shipping, applies to the peculiar facts of this case..
Without going into the merits of petitioner's appeal, we hold that the NLRC erred in dismissing
the appeal on the ground that it was filed out of time.
The petition is GRANTED.

Chong Guan Trading v. NLRC

G.R. No. 81471, April 26, 1989 – FLORA
FACTS: Chong Guan Trading (CGT) is a dealer of paper and paper products, owned by Mariano,
Pepito, and Efren Lim. Jose Chua was employed as sales manager of CGT. Chua started working
with CGT in 1960, but it was only in 1972 that his name was registered by CGT with the Social
Security System.
On the morning of October 28, 1983, a customer who borrowed the store’s telephone directory
accidentally dropped it on the top-glass of the store’s showcase, causing it to break. Pepito Lim
saw the already taped, broken top-glass and asked for an explanation. To cover up for the customer,
Chua admitted that he himself broke it, and with that, Pepito Lim got angry and hurled ‘unprintable
words and invectives’ at Chua.

In November 1983, Chua filed a complaint with the Office of the Labor Arbiter of the NCR
charging petitioner with illegal dismissal and non-payment of overtime pay and other benefits
provided for by law. In his complaint, Chua alleged that he was fired by Mariano Lim because of
the incident.

What the LA said: There was no illegal dismissal since Chua was never dismissed by CGT. The
altercation cannot be construed as a dismissal of Chua because it was only a minor incident. The
LA ordered the reinstatement of Chua but without backwages.
Chua appealed the LA’s decision to the NLRC, but the NLRC dismissed the appeal because it was
filed out of time. However, Chua asked to reconsider the dismissal. The NLRC granted it and
rendered a decision.

What the NLRC said: There was an illegal dismissal because Chua was dismissed without the
attendant formalities required by law. The NLRC orders the reinstatement of Chua with 3 years
backwages.
CGT appealed the NLRC’s decision to the Supreme Court interposing that the NLRC had no
jurisdiction to entertain Chua’s appeal because the LA’s decision is final and executory after the
lapse of 10 days from CGT’s receipt of it.

ISSUES:
1. PROCEDURE: Whether the NLRC committed grave abuse of discretion in giving due course
to Chua’s appeal.
RULING:
No. The NLRC did not commit grave abuse of discretion in giving due course to Chua’s appeal.

The rule is that an appeal must be filed within 10 CALENDAR days from receipt of the decision.
If an appeal is filed beyond 10 CALENDAR days, you can no longer appeal. However, Chua’s
reason is that his counsel relied on the footnote of the notice of the decision of the LA which stated
that, “the aggrieved party may appeal... within 10 WORKING days.” Because of such error which
is not the fault of Chua and his counsel, since they merely relied on the footnote of the LA’s
decision, Chua’s appeal has an acceptable reason to be filed late.

The Court may overlook the particular procedural lapse and proceed with the resolution of the
case.
AQUINO vs NLRC (Sept. 3, 1993) – Garduce
FACTS: Roman Aquino filed before the LA a complaint for illegal dismissal against Roblett
Industrial Construction (RIC). He alleged that he was removed from the payroll in January 1987
and was not paid his salary. RIC answered that Aquino had abandoned his work after he was held
accountable for advances amounting to P48,921.94.

LA: The Labor Arbiter found the dismissal as illegal, and ordered RIC to reinstate Aquino to his
former or equivalent position, with full backwages.

The counsel for RIC received a copy of the decision on June 13, 1990. The last day to appeal
therefore was on June 23, 1990, which fell on a Saturday. The counsel, however, filed the appeal
on Monday, June 25, 1990, two days beyond the reglementary period. On July 4, 1990, petitioner
filed a motion to dismiss the appeal because the period to appeal had already lapsed; and SIC did
not post the surety or cash bond required by Section 223 of the Labor Code.

NLRC: Finding that the LA did not abuse his discretion in rendering his decision and that RIC
failed to file a cash or surety bond to perfect its appeal, the NLRC dismissed the appeal. However,
upon motion of RIC, the NLRC reversed its decision on the following grounds:
(1) The memorandum of appeal could not be filed on June 23, 1990, because the NLRC has no
office on Saturdays. Hence, the filing of the memorandum of appeal on July 25, 1990 was timely;
and
(2) When the appeal was filed on July 25, 1990, the Rules implementing R.A. No. 6715 on the
requirement of an appeal bond to perfect an appeal, had not been promulgated. While the Interim
Rules promulgated by the old NLRC required the filing of appeal bonds, the new NLRC created
under R.A. No. 6715 was authorized to promulgate the implementing rules and therefore it was
not bound to follow said Interim Rules.

Hence, Aquino filed a petition for certiorari under Rule 65 to annul the NLRC Decision, alleging
grave abuse of discretion amounting to lack or excess of jurisdiction on the part of NLRC

Procedural issues:
Whether the special civil action for certiorari can be availed of: (1) to review an interlocutory
order; (2) without first filing a motion for reconsideration in the NLRC; and (3) when there exists
a plain, speedy and adequate remedy, that of filing an answer to the memorandum on appeal.

Substantive issues: virtual 1aw library

(1) Whether or not a memorandum on appeal due on a Saturday can be filed timely on the following
Monday; and
(2) Whether or not the filing of a bond to perfect an appeal, under Art. 223 of the Labor Code as
amended by R.A. No. 6715, was required for appeals before the adoption of the NLRC Rules
implementing said amendatory law.

SC’s Decisions:
On the procedural issues raised, we hold that where an interlocutory order was allegedly issued
with grave abuse of discretion amounting to lack or excess of jurisdiction, such order may be
questioned before this Court on a petition for certiorari under Rule 65 of the Revised Rules of
Court. To delay the review of the order until the appeal from the decision of the main case, would
not afford the party adversely affected by the said order a speedy, plain and adequate remedy.

Regarding the failure of petitioner to file a motion for reconsideration before the NLRC, such
failure may be excused where the order sought to be reviewed is a patent nullity.

The governing law on the question of the timeliness of the appeal of private respondent is Article
223 of the Labor Code, which states that an appeal from the decision of the Labor Arbiter must be
made within ten calendar days from receipt of such decisions. Said provision of the Labor Code,
however, is silent with regard to cases when the ten-day reglementary period within which to
perfect an appeal falls on a Saturday, which is not a holiday.

On January 14, 1992, the NLRC amended its Rules of Procedure: if the tenth day to perfect an
appeal from the decision of the Labor Arbiter to the NLRC falls on a Saturday, the appeal shall be
made on the next working day.

The filing of the appeal by RIC was timely.

However, it must be dismissed for failure of the appellant to file the cash or surety bond required
under Article 223 of the Labor Code.

Hence, the decision of the Labor Arbiter has became final and executory. Petition granted.

G.R. No. 77188 CELSO BONGAY, AVELINO QUIBE, and JOSE MADRIDENOS,
petitioners,
vs.
THE HONORABLE CONCHITA J. MARTINEZ, Labor Arbiter Of The Regional
Arbitration Branch of the NATIONAL LABOR RELATIONS COMMISSION, REGION
NO. XI, and GALMAR AGRI-PRODUCTS, INCORPORATED and/or SOLOMON and
LEOPOLDO HONG, respondents.
The Solicitor General for public respondents.
Ma. Felix Tataal Calatrava for the adverse party. – GONADAN
FACTS: Problem: Illegal dismissal, non-payment of emergency cost of living allowance
(ECOLA), holiday pay, overtime pay, incentive leave pay, plus damages and attorney's fees

On October 10, 1985, a decision was rendered by Labor Arbiter Joaquin Tanodra of the Regional
Arbitration Branch XI, Davao City, on the complaint for illegal dismissal, non-payment of
emergency cost of living allowance (ECOLA), holiday pay, overtime pay, incentive leave pay,
plus damages and attorney's fees, lodged by the petitioners against the private respondents. The
decision, while ordering the reinstatement of the petitioners with full back wages from date of
dismissal until actual reinstatement without loss of seniority rights and other privileges, denied the
other money claims in the complaint for lack of satisfactory evidence. A copy of the decision was
received by the private respondents on February 4, 1986. The reglementary period within which
to appeal lapsed without the private respondents having done so, hence, the decision became final
and executory.

On April 12, 1986, Labor Arbiter Jose Libron, acting on the motion for the issuance of a writ of
execution filed on April 1, 1986 by the petitioners, issued an order directing the computation of
the monetary award due under the decision. Accordingly, a Report of Examiner dated April 14,
1986 was submitted by Corporate Auditing Examiner of the Arbitration Branch Raymundo
Rotante awarding the amount of P43, 171.02 to each of the petitioners as his backwages, or a total
amount of P 129, 513.06. The respondents filed an opposition to the computation on the ground
that it was vague and conjectural. They then prayed that the Examiner who undertook the
computation be ordered to fully substantiate his findings and to find out the exact amount to be
awarded to the petitioners; and that Examiner Rotante be ordered to re-compute the amount due,
as his report was contrary to the records of the private respondents who had in their hands
documents allegedly showing that one of the petitioners had executed a quitclaim to the monetary
award due him.
Finding merit on the private respondents' opposition, Labor Arbiter Libron ordered that another
computation of the award due to the petitioners be made. On July 31, 1986, Corporate Auditing
Examiner Evelina N. Hoy, who was did re-computation, confirmed the correctness of the amount
found in the first computation report of Rotante. The private respondents did not file any opposition
to the second computation.

Thus, on August 29, 1986, Labor Arbiter Libron issued a writ of execution addressed to the Sheriff
of the Regional Arbitration Branch XI, Davao City, directing the latter to accompany the
petitioners to the private respondents' premises and have them reinstated, and to collect from the
respondents the amount of P129,513.06 which should be turned over to the Arbitration Office for
proper disposition. The Sheriff was further instructed that upon failure to collect the computed
amount he should proceed to cause the satisfaction of the same out of the private respondents'
properties not exempt from execution.
On September 9, 1986, respondents filed a motion to quash the writ of execution. Labor Arbiter
Antonio Villanueva initially acted favorably on the motion by issuing an order to hold in abeyance
the implementation of the writ. However, upon a manifestation filed by the petitioners pointing
out that the motion to quash was pro forma as the grounds raised therein were in truth grounds for
an appeal which at that stage could no longer be entertained as the period to do so had long elapsed,
Labor Arbiter Villanueva, on September 29, 1986, denied the private respondents' motion and
vacated his previous order.
Respondents filed a memorandum on appeal dated October 16, 1986 from the decision dated
October 10, 1985 and from the order dated September 29, 1986. Simultaneous with the filing of
the appeal, the private respondents likewise filed with the Regional Arbitration Office an Urgent
Ex-parte Motion to Stay Execution. The petitioners moved to dismiss the appeal contending that
the period thereof had already lapsed.

On October 23, 1986, the public respondent, Labor Arbiter and Officer-In-Charge Conchita
Martinez, citing Section 2, Rule IX of the old Rules of the National Labor Relations Commission
as basis, issued an order staying the execution of the decision dated October 10, 1985 (erroneously
stated as October 31, 1985, and in the said order) directing the private respondents to post a bond
amounting to P129,513.06. She then elevated the case to the Executive Director of the NLRC. The
private respondents on their part posted the required bond on October 29, 1986.

It is the order dated October 23, 1986 of Labor Arbiter and Officer-In-Charge Conchita Martinez
which is now the bone of controversy in this petition.
Petitioners’ contentions:
(1) the appeal interposed by the private respondents is out of time
(2) Labor Arbiter and Officer-In-Charge Conchita Martinez, erred and gravely abused her
discretion in applying the provisions of Section 2, Rule IX of the Rules of the National Labor
Relations Commission.

Basis of their contention: According to the petitioners, the execution of the decision which was
rendered as early as October 10, 1985 could no longer be stayed even upon the posting by the
private respondents of a bond to stay execution pending appeal. The stay of execution provided in
Section 2, Rule IX could only be ordered by the respondent Labor Arbiter if the appeal interposed
was timely and based on valid grounds, which is not so in this instance.

The private respondents contend otherwise. They maintain that their appeal to the NLRC was filed
seasonably and Labor Arbiter and Officer-In-Charge Conchita Martinez acted well within the law
in enjoining the execution of the contested decision.
(1) They assert that even if they failed to appeal within the ten-day reglementary period provided
by law, their failure was brought about by the negligence of their counsel's secretary to inform her
employer of the receipt of a copy of the contested decision. This, according to the private
respondents, constitutes excusable negligence.
(2) Their payment of the required appeal fees perfected their appeal.
(3) They also claim that it is exclusively within the jurisdiction of the Commission to determine
whether or not an appeal has been filed seasonably.
ISSUES:
Whether or not the private respondents' appeal to the NLRC had already lapsed?
Whether or not the respondent Labor Arbiter erred and gravely abused her discretion in applying
the provisions of Section 2, Rule IX of the old Rules of the NLRC?
RULING: The arguments of the private respondents are without merit. We agree with the
petitioners. Their petition must be granted. The private respondents' appeal has been filed out of
time. Hence, the public respondent gravely abused her discretion in applying the provision of
Section 2, Rule IX of the Rules of the NLRC and issuing the assailed order of October 23, 1986.
As correctly synthesized by the Solicitor General in his Comment to the petition, which,
incidentally, recommended that this petition be given due course, the decision rendered by Labor
Arbiter Joaquin Tanodra as early as October 10, 1985 had long become final and executory. The
private respondents failed to appeal therefrom within the ten-day reglementary period provided by
the law. As a consequence thereof, the applicable provision of the Rules of the NLRC could not
have been, as thought by Labor Arbiter and Officer-In-Charge Conchita Martinez, Section 2, of
Rule IX of the NLRC Rules, which applies only where the appeal is timely perfected, but Section
1, Rule XIII which specifically enjoins a Labor Arbiter to issue a writ of execution ordering the
proper authority to carry out the execution of a final decision. The issuance of the writ of execution,
once the decision has become final and executory, is a ministerial duty of the Labor Arbiter.

The Labor Code is very explicit as to the period to appeal from a decision, award, or order of the
Labor Arbiter to the National Labor Relations Commission. It is ten (10) days.

Art. 223. Appeal.- Decisions, awards, or orders of the Labor Arbiter or compulsory arbitrators are
final and executory unless appealed to the Commission by any or both of the parties within ten
(10) days from receipt of such awards, orders, or decisions. x x x.

Corollarily, it is now well-settled that this ten-day period means ten calendar days. In this case,
there is no showing that the private respondents filed their appeal within ten calendar days from
their receipt of a copy of the decision on February 4, 1986. On the contrary, the private respondents
themselves in their Motion to Quash Order of Writ of Execution concede that they failed to do so.

As already stated, the reason advanced by the private respondents for their failure to interpose a
timely appeal does not, however, constitute excusable neglect. But even assuming that what
transpired could be forgiven as excusable negligence, the filing by the private respondents of an
opposition to the first computation of Examiner Rotante instead of an outright appeal from the
decision itself, may be deemed as a waiver of their right to appeal. The subsequent payment of the
appeal fees under Section 2, Rule IX of the old NLRC Rules did not cure that defect. The October
10, 1987 decision remains final and executory.

The contention of the private respondents that the determination of whether or not their appeal was
filed seasonably should be left to the Commission as the latter has exclusive jurisdiction to rule on
the question, must likewise fail. That argument is belied by Section 5, Rule IX of the Rules of the
NLRC which empowers not only the Commission but also the Labor Arbiter to impose reasonable
penalties, including fines and censures, upon a party for filing a frivolous appeal. This implies that
even when the appeal is still with the Labor Arbiter, and not yet transmitted to the Commission,
the former may already find it frivolous and, there and then, terminate the appeal. Had it been as
the private respondents claim, the Labor Arbiter would not have been given such power.

Parenthetically, while the private respondents may have been initially left with the right to appeal
from the second computation of the monetary award due to the petitioners after the decision on the
merits of the case has become final, the right was waived by them when they failed to file a timely
opposition thereto. It is notable that unlike in the first computation report when the private
respondents submitted a timely opposition, they did not do so as regards the second computation.
In fact, the only time when they caused a furor was when a writ of execution was already issued
by Labor Arbiter Jose Libron. This delayed action of the private respondents does not speak well
of their cause. Rather, it pictures a belated attempt to thwart the implementation of a valid writ of
execution based on an unopposed computation of the amount of the award.

Lastly, we are not uncognizable of the fact that the appeal filed by the private respondents in the
NLRC is still pending. However, since we find the facts on record substantially sufficient for us
to rule that the appeal was filed late and is patently dilatory and would serve no other purpose
except to delay and frustrate justice, and as has been aptly put, "justice delayed is not only justice
denied, but justice despised and finally despaired of -- the germ of destruction of any government
or order of society," we are thus constrained under the circumstances to order the NLRC to dismiss
the appeal of the private respondents docketed as NLRC Case No. 1151-LR-XI-8

VIRGILIO S. CARIÑO vs. NLRC- LUMASAC

Facts:
Cariño was former president of private respondent Harrison Industrial Workers' Union. Because
of gross mismanagement of Union affairs, other Union officers investigated and invited Cariño
several times to answer the charges against him. Charges were conspiring with the company during
CBA negotiation, paying union counsel from their fund without obtaining corresponding receipts,
unilaterally increasing the membership dues to pay increased attorney's fees, failure to present
provisions of CBA prior to ratification by members, and refusal to turn over custody and
management of funds to the Union treasurer.

Because Cariño did not respond to invitations for investigation, the investigating committee
conducted a general membership meeting where charges against him were discussed. Cariño did
not appear in hearings despite due notice. The Union members impeached and expelled Cariño
having found guilty with the charges. They informed their company and effective the next day,
Cariño was terminated.

Cariño, represented by former Union counsel Atty. Leynes, filed a complaint for illegal dismissal
with the LA. The LA ordered his reinstatement with full backwages and payment of attorney's fees
having found no just cause for the dismissal and due to the disregard in the notice and hearing
requirements.

On appeal, NLRC reversed the decision by awarding only penalty and financial assistance such as
payment of separation pay, due to the serious charges of mismanagement against him and his
silence which is tantamount to admission of guilt. But NLRC admitted that dismissal was
inconsistent with the requirements of due process. In a petition for certiorari, Cariño sought
reinstatement of LA’s decision.

Issues:
1. Was there just cause in Cariño’s dismissal?
2. Was Cariño deprived of procedural due process on the union level? On the company
level?

Held:
1. Yes, the court found all the allegations charged against Cariño by the Union members
reasonably fall within the Union's Constitution and By-Laws .

2. Yes, Cariño was deprived of procedural due process on the union level since his impeachment
had not been initiated by a formal petition or resolution signed by at least thirty percent (30%) of
bona fide members of the Union as indicated in the Union’s Constitution. However, multiple
opportunities were given to Cariño before the investigating committee, before the general Union
members as well as before the Bureau of Labor Relations and he chose to disregard all calls for
him to appear and defend himself. The court decided that failure to comply literally with the
Union's Constitution must be regarded as non-material and the impeachment and recall proceeding
had been more than substantially complied with.

On the company level, the court also concluded that Cariño was deprived of due process. The
company should not have issued a termination letter immediately effective the next day upon
formal advice of Cariño’s expulsion by the Union. The company should have reasonably satisfied
itself by its own inquiry that the Union was not acting arbitrarily and capriciously with the
impeachment.

However, the grant of separation pay to Cariño was an inappropriate response, there having been
just cause for the dismissal, to the failure of the Company to accord him his full measure of due
process. Since he had clearly disdained answering the charges preferred against him within the
Union, there was no reason to suppose that if the Company had held formal proceedings before
dismissing him, he would have appeared in a Company investigation and pleaded his defenses.
Considering all the circumstances, the court believes that a penalty of P5,000 payable to Cariño
should be quite adequate, the penalty to be borne by the Company and the Union solidarily.

PART II
FINALS

SSS v. COURT OF APPEALS and MANILA COSMOS AERATED WATER FACTORY,

INC. - ALDEN
G.R. No. L-55764 February 16, 1982
FACTS: Individual petitioners filed with Social Security Commission an action praying to be
declared employees of Manila Cosmos AerAted Water Factory, Inc. (Cosmos) and not
independent contractors. Their contract states the following:
1. The MANUFACTURER shall provide the PEDDLER with a delivery truck to be used by
the latter, under his own responsibility, exclusively in the sales of the products of the former
purchased by the PEDDLER from the MANUFACTURER;
2. The PEDDLER himself shall carefully and in strict observance to traffic regulations, drive
the truck furnished him by the MANUFACTURER or should he employ a driver or helpers,
such driver or helpers shall be his employees under his direction and responsibility, and
not that of the MANUFACTURER, and their compensation including salaries, wages,
overtime pay, separation pay, bonus or other remunerations and privileges shall be for the
PEDDLERS own account;
3. The PEDDLER shall be responsible for any damage to property, death or injuries to
persons or damage to the truck used by him caused by his own acts or that of his driver and
helpers;
4. The PEDDLER shall secure at his own expense all necessary license and permits required
by law or ordinance, and shall bear any and all expenses which may be incurred by him in
the sales of the MANUFACTURER'S products, covered by this contract;
5. All goods soft drinks) purchased by the PEDDLER shall be charged to him at a factory
price of P0.86 per case of the 6.6 oz. size, ex-warehouse; PROVIDED, However, that, if
the PEDDLER purchases a total of not less than 200 cases of the 6.5 oz. size a day, he shall
be entitled to a dealer's discount of P7.30;
6. Upon the execution of this agreement, the PEDDLER shall give a cash bond in the amount
of P500.00 against which the MANUFACTURER shall charge the PEDDLER with any
unpaid account at the end of the day or with any damage to the truck or other account which
is properly chargeable to the PEDDLER; within 30 days after termination of this
agreement, the cash bond, after deducting proper charges, shall be returned to the
PEDDLER;
7. The PEDDLER shall liquidate and pay his account at the end of each day, and his failure
to do so shall subject his cash bond or so much thereof as may be necessary to such set offs
and payments as shall be proper against the accounts in question;
8. This contract shall be effective only up to December 31, 1962 and supersedes any or all
other previous contracts that may have been entered into between the parties; However,
either of the parties may terminate the same upon seven (7) days prior notice to the other
9. Upon the termination of this agreement, unless the same is renewed, the delivery truck and
such other equipment furnished by the MANUFACTURER to the PEDDLER shall be
returned by the latter in good order and workable condition, ordinary wear and tear
excepted, and shall promptly settle his outstanding account if any, with the manufacturer.
(Rollo, pp. 24-25.
If so, Cosmos would have "to pay the employer's share of premium contributions (employer's and
employees' share) for and in behalf of the delivery helpers, as employees of respondent
corporation, plus the penalties thereon for late remittance of premium contributions, covering the
period of delinquency from the respective dates of their coverage up to the present" as prayed for
in the petition.
SSC rendered a resolution in favor of the SSS and the peddlers holding that an employer-employee
relationship existed between Cosmos and the peddlers. Such was affirmed when appealed with the
CA.
However, upon a motion for reconsideration, the Court of Appeals on October 13, 1980, set aside
its previous decision and reversed the resolution of the SSC. Hence, the instant appeal where the
petitioner is the SSS alone; the individual peddlers have not seen fit to appeal.
ISSUE: Whether they are employees of Cosmos
HELD: In determining the existence of employer-employee relationship, the following elements
are generally considered, namely: (1) the selection and engagement of the employee; (2) the
payment of wages: (3) the power of dismissal: and (4) the power to control the employees' conduct
— although the latter is flip, most important element (Viaña Al-Lagadan and Piga 99 Phil, 406,
411, Citing 35 Am. Jur. 445).
An independent contractor is "one who exercise independent employment and contracts to do a
piece of work according to his own methods and without being subject to control of his employer
except as to the result of the work" (Mansal vs. P.P. Gocheco Lumber Co., 96 Phil. 941).
Among the factors to be considered are whether the contractor is carrying on an independent
business; whether the work is part of the employer's general business; the nature and extent of the
work; the skill required; the term and duration of the relationship; the right to assign the
performance of the work to another; the power to terminate the relationship; the existence of a
contract for the performance of a specified piece of work; the control and supervision of the work;
the employer's powers and duties with respect to the hiring, firing, and payment of the contractor's
servants; the control of the premises; the duty to supply the premises, tools, appliances, material
and labor; and the mode, manner, and terms of payment. (56 C.J.S. 46).
In determining whether the relationship is that of employer and employee or whether one is an
independent contractor, "each case must be determined on its own facts and all the features of the
relationship are to be considered" (56 C.J.S. 45). We are convinced that on the basis of the peddling
contract, no employer-employee relationship was created. (At pp. 161-163, emphasis supplied.)
Under the peddling contract, Mafinco would provide the peddler with a delivery truck and the
peddler is responsible for compensation of his driver and helpers. In addition, the peddler would
also bear the cost of gasoline and maintenance of the truck and secure their licenses and permits.
The petitioner would also post a cash bond and the contract may be terminated upon 5 days prior
notice. On the basis of the peddling contract, no employer-employee relationship was created.
Thus, the petitioner is an independent contractor.
TENAZAS et al., v R. VILLEGAS TAXI TRANSPORT - BAUCAS
FACTS: Tenazas, Francisco and Endraca filed a complaint for illegal dismissal against R. Villegas
Taxi Transport..
Previously the taxi unit assigned to Tenazas was sideswiped by another vehicle, causing dents on
the taxi. Upon reporting the incident to the company, he was scolded and was told that he was
fired.
Francisco said that his dismissal was brought about by the company’s unfounded suspicion that he
was organizing a labor union. He was instantaneously terminated, without the benefit of procedural
due process.
Endraca alleged that his dismissal was instigated by an occasion when he fell short of the required
boundary for his taxi unit. Before he was dismissed, he brought his taxi unit to an auto shop for an
urgent repair. He was charged the amount of ₱700.00 for the repair services and the replacement
parts. As a result, he was not able to meet his boundary for the day. Upon returning to the company
garage and informing the management of the incident, his driver’s license was confiscated and was
told to settle the deficiency in his boundary first before his license will be returned to him. He was
no longer allowed to drive a taxi unit despite his persistent pleas.
Villegas said that Tenazas was a regular employee and Endraca was a spare driver but alleged that
Francisco was not an employee of the company; that Tenazas was never terminated but he was not
able to drive due to the overhaul of the taxi unit because of some mechanical defects. He was only
advised to wait for further notice from the company if his unit has already been fixed. However,
upon being informed that his unit is ready for release, Tenazas did not report to work.
Villegas said that Endraca stopped reporting for work without informing the company of his
reason.
The Labor arbiter ruled that that there was no illegal dismissal in the case at bar due to lack of
evidence. The NLRC ruled in favor of the complainants; that the additional pieces of evidence
belatedly submitted sufficed to establish the existence of employer-employee relationship and their
illegal dismissal. The CA ruled that Tenazas and Endraca were illegally dismissed, but ruled
otherwise in the case of Francisco for failing to establish his relationship with the company.
Issue: Whether or not the complainants were illegally dismissed from employment.
RULING of the SC: Tenazas and Endraca were illegally dismissed but there cannot be illegal
dismissal on the part of Francisco because he was not an employee of Villegas. The filing of the
complaint is inconsistent with the claim of Villegas that Teneza and Endraca refused to be
reinstated. Their complaint meant that they wanted to return to work.
In determining the presence or absence of an employer-employee relationship, the following must
be present (a) the selection and engagement of the employee; (b) the payment of wages; (c) the
power of dismissal; and (d) the employer’s power to control the employee on the means and
methods by which the work is accomplished.
Francisco failed to present any proof substantial enough to establish his relationship with the
respondents. Where an employer denies employer-employee relationship. The burden shifts to the
employee to prove that such a relationship exists.
The proper remedy is the reinstatement of Tenazas and Endraca, instead of the payment of
separation pay because reinstatement was still a viable option. The two reliefs are separate and
distinct. In instances where reinstatement is no longer feasible because of strained relations
between the employee and the employer, separation pay is granted. In effect, an illegally dismissed
employee is entitled to either reinstatement, if viable, or separation pay if reinstatement is no longer
viable, and backwages. Where reinstatement is no longer viable as an option, separation pay
equivalent to one (1) month salary for every year of service should be awarded as an alternative.
The payment of separation pay is in addition to payment of backwages.
DAVID vs. MACASIO - Mayaoyao
FACTS: In January 2009, Macasio filed before the LA a complaint against petitioner Ariel L.
David, doing business under the name and style "Yiels Hog Dealer," for non-payment of overtime
pay, holiday pay and 13th month pay. He also claimed payment for moral and exemplary damages
and attorney’s fees. Macasio also claimed payment for service incentive leave (SIL).
Macasio alleged that he had been working as a butcher for David since January 6, 1995. Macasio
claimed that David exercised effective control and supervision over his work, pointing out that
David: (1) set the work day, reporting time and hogs to be chopped, as well as the manner by which
he was to perform his work; (2) daily paid his salary of ₱700.00, which was increased from
₱600.00 in 2007, ₱500.00 in 2006 and ₱400.00 in 2005; and (3) approved and disapproved his
leaves. Macasio added that David owned the hogs delivered for chopping, as well as the work tools
and implements; the latter also rented the workplace. Macasio further claimed that David employs
about twenty-five (25) butchers and delivery drivers. Macasio also pointed out the certificate of
employment issued by David.
David claimed that he hired Macasio for pakyaw or task basis who is, therefore, not entitled to
overtime pay, holiday pay and 13th month pay.David pointed out that Macasio: (1) usually starts
his work at 10:00 p.m. and ends at 2:00 a.m. of the following day or earlier, depending on the
volume of the delivered hogs; (2) received the fixed amount of ₱700.00 per engagement, regardless
of the actual number of hours that he spent chopping the delivered hogs; and (3) was not engaged
to report for work and, accordingly, did not receive any fee when no hogs were delivered.He also
claimed that he issued the Certificate of Employment, upon Macasio’s request, only for overseas
employment purposes.
LA: Dismissed Macasio’s complaint for lack of merit and gave credence to David's claims. The
LA concluded that as Macasio was engaged on "pakyaw" or task basis, he is not entitled to
overtime, holiday, SIL and 13th month pay.
NLRC: Affirmed LA's decision.
CA: CA agreed with the LAand the NLRC that Macasio was a task basis employee but entitled to
his monetary claims. The CA explained that as a task basis employee, Macasio is excluded from
the coverage of holiday, SIL and 13th month pay only if he is likewise a "field personnel." As
defined by the Labor Code, a "field personnel" is one who performs the work away from the office
or place of work and whose regular work hours cannot be determined with reasonable certainty.
In Macasio’s case, the elements that characterize a "field personnel" are evidently lacking as he
had been working under David's supervision and working in a fixed schedule. CA awarded
Macasio’s claim for holiday, SIL and 13th month pay for three years, with 10% attorney’s fees on
the total monetary award.

ISSUE: whether Macasio is entitled to holiday, SIL and 13th month pay as task basis employee.
RULING: In determining whether workers engaged on "pakyaw" or task basis" is entitled to
holiday and SIL pay, the presence (or absence) of employer supervision as regards the worker’s
time and performance is the key: if the worker is simply engaged on pakyaw or task basis, then
the general rule is that he is entitled to a holiday pay and SIL pay unless exempted from the
exceptions specifically provided under Article 94 (holiday pay) and Article95 (SIL pay) of the
Labor Code. However, if the worker engaged on pakyaw or task basis also falls within the meaning
of "field personnel" under the law, then he is not entitled to these monetary benefits. Macasio does
not fall under the classification of "field personnel"
Based on the definition of field personnel under Article 82, we agree with the CA that Macasio
does not fall under the definition of "field personnel." The CA’s finding in this regard is supported
by the established facts of this case: first, Macasio regularly performed his duties at David’s
principal place of business; second, his actual hours of work could be determined with reasonable
certainty; and, third, David supervised his time and performance of duties. Since Macasio cannot
be considered a "field personnel," then he is not exempted from the grant of holiday, SIL pay even
as he was engaged on "pakyaw" or task basis.
Not being a "field personnel," we find the CA to be legally correct when it reversed the NLRC’s
ruling dismissing Macasio’s complaint for holiday and SIL pay for having been rendered with
grave abuse of discretion.
Entitlement to 13th month pay
With respect to the payment of 13th month pay however, we find that the CA legally erred in
finding that the NLRC gravely abused its discretion in denying this benefit to Macasio.
The governing law on 13th month pay is PD No. 851.53

As with holiday and SIL pay, 13th month pay benefits generally cover all employees; an employee
must be one of those expressly enumerated to be exempted. Section 3 of the Rules and Regulations
Implementing P.D. No. 85154 enumerates the exemptions from the coverage of 13th month pay
benefits. Under Section 3(e), "employers of those who are paid on xxx task basis, and those who
are paid a fixed amount for performing a specific work, irrespective of the time consumed in the
performance thereof"55 are exempted.
Note that unlike the IRR of the Labor Code on holiday and SIL pay, Section 3(e) of the Rules and
Regulations Implementing PD No. 851 exempts employees "paid on task basis" without any
reference to "field personnel." This could only mean that insofar as payment of the 13th month
pay is concerned, the law did not intend to qualify the exemption from its coverage with the
requirement that the task worker be a "field personnel" at the same time.
SOUTH EAST INTERNATIONAL RATTAN, INC. and/or ESTANISLAO AGBAY vs.
JESUS J. COMING - MASEDMAN
FACTS: South East International Rattan, Inc. (SEIRI) is a domestic corporation engaged in the
business of manufacturing and exporting furniture to various countries with place of business at
Mandaue City.
Jesus J. Coming filed a complaint for illegal dismissal, underpayment of wages, non-payment of
holiday pay, 13th month pay and service incentive leave pay, with prayer for reinstatement, back
wages, damages and attorney fees against SEIRI.
Coming alleged that on March 1984, petitioners hired him as Sizing Machine Operator. He worked
from 8:00 a.m. to 5:00 p.m. At first, his compensation was on pakiao basis but sometime in June
1984, it was fixed at P150.00 per day paid to him on a weekly basis.
In 1990, without any apparent reason, his employment was interrupted and was told to resume
work in two months’ time. Being uneducated, Coming was persuaded not to complain because he
might not be called back for work. After two months he reported back to work upon order of
management.

Despite being an employee for many years with his work performance never questioned, Coming
was dismissed on January 1, 2002 without lawful cause. He was told that he will be terminated
because the company is not doing well financially and that he would be called back to work only
if they need his services again. Coming waited for almost a year but petitioners did not call him
back to work.
He filed the complaint before the regional arbitration branch.
As their defense, SEIRI denied having hired Coming asserting that SEIRI was incorporated only
in 1986, and that respondent actually worked for SEIRI furniture suppliers because when the
company started in 1987 it was engaged purely in buying and exporting furniture and its business
operations were suspended from the last quarter of 1989 to August 1992.
They stressed that respondent was not included in the list of employees submitted to the SSS.
Moreover, respondent brother, Vicente Coming, executed an affidavit in support of SEIRI’s
position while Allan Mayol and Faustino Apondar (Suppliers) issued notarized certifications that
Coming worked for them instead.
The Labor Arbiter ruled that Coming is a regular employee of SEIRI and that the termination of
his employment was illegal.
SEIRI appealed to the NLRC Cebu City. The NLRC set aside the decision of the LA compelling
Coming to file a petition for certiorari under Rule 65 before the Court of Appeals. The CA ruled
in favor of the respondent and declared that there existed an employer-employee relationship
between petitioners and respondent who was dismissed without just cause. SEIRI moved for
reconsideration but the same was denied. Hence, the present petition for review on certiorari.
ISSUE: Whether or not there exists an employer-employee relationship between the petitioners
and the respondent?
HELD: The Court sustained that Decision of the Court of Appeals.
In order to establish the existence of an employer-employee relationship, the four-fold test is used,
to wit: (1) the selection and engagement of the employee; (2) the payment of wages; (3) the power
of dismissal; and (4) the power to control the employee conduct, or the so-called control test.
As to the "control test", the following facts indubitably reveal that respondents wielded control
over the work performance of petitioner, to wit:
(1) they required him to work within the company premises;
(2) they obliged petitioner to report every day of the week and tasked him to usually perform
the same job;
(3) they enforced the observance of definite hours of work from 8 o’clock in the morning
to 5 o’clock in the afternoon;
(4) the mode of payment of petitioner’s salary was under their discretion, at first paying him
 on pakiao basis and thereafter, on daily basis;
(5) they implemented company rules and regulations;
(6) Agbay (President and General Manager of SEIRI) directly paid petitioner’s salaries and
controlled all aspects of his employment and
(7) petitioner rendered work necessary and desirable in the business of the respondent
company
Moreover, the Court in Tan v. Lagrama, held that the fact that a worker was not reported as an
employee to the SSS is not conclusive proof of the absence of employer-employee relationship.
Otherwise, an employer would be rewarded for his failure or even neglect to perform his
obligation. Nor does the fact that Coming’s name does not appear in the payrolls and pay envelope
records submitted by petitioners negate the existence of employer-employee relationship. In this
case, the exhibits offered SEIRI before the NLRC consisting of copies of payrolls and pay earnings
records do not cover the entire 18-year period during which Coming supposedly worked for SEIRI.
Thus, Coming is a regular employee. Since the dismissal was without valid cause, Coming is
entitled to reinstatement without loss of seniority rights and other privileges and to his full back
wages, inclusive of allowances and other benefits of their monetary equivalent, computed from the
time his compensation was withheld from him up to the time of his actual reinstatement.
However, where reinstatement is no long feasible as an option, back wages shall be computed from
the time of the illegal termination up to the finality of the decision. As an alternative to this,
separation pay equivalent to one month salary for every year of service should likewise be awarded
in case reinstatement is not possible.
Sameer Overseas Placement Agency, Inc v Cabiles GR No. 170139 - MUÑOZ

FACTS: Joy Cabiles applied for a quality control job in Taiwan through Sameer Overseas
Placement Agency (SOPA). Her application was accepted and she was later asked to sign a one-
year employment contract for a month salary of New Taiwan Dollar (NT$) 15,360.00. Moreover,
she was also asked to pay a placement fee of Php 70,000 when she signed the employment contract.
Joy was deployed to work for Taiwan Wacoal, Co. Ltd. (Wacoal) on June 26, 1997. She agreed to
work as quality control for one year but was asked to work as a cutter in Taiwan. On July, 1997, a
certain Mr. Huwang from Wacoal informed Joy, without prior notice, that she was terminated and
that “she should immediately report to their office to get her salary and passport. She was then
asked to “prepare for immediate repatriation” Joy claims that she only earned a total of NT4 9,000
during the time of her employment. According to her, Wacoal deducted NT$ 3,000 to cover her
plane ticket to Manila

On October 15, 1997, Joy filed a complaint on the ground of illegal dismissal with the NLRC
against SOPA and Wacoal. She asked for the return of her placement fee, for the withheld amount
for repatriation costs, for the payment of her salary for 23 months as well as for the exemplary and
moral damages. She identified Wacoal as Sameer Overseas Placement Agency’s foreign principal.

In their answer, SOPA alleged that the respondent’s termination was due to her inefficiency and
that the agency did not ask for a placement fee of Php 70,000. As evidence, a receipt bearing the
amount of Php 20, 360 was showed. SOPA added the Wacoal’s accreditation of transfer to Pacific
Manpower and Management Services, Inc. Thus, they were already substituted by the company.
Pacific Manpower moved to dismiss the petitioner’s claim against it since there was no employee-
employer relationship between them. Hence, the claims against them are outside the jurisdiction
of the LA.

The LA dismissed Joy’s complaint. On appeal, the NLRC reversed the decision. The commission
declared that Joy was illegally dismissed. It reiterated the doctrine that the burden of proof to show
that the dismissal was based on a just or valid cause belongs to the employer. It found that SOPA
failed to prove that there were just causes for termination. Furthermore, procedural due process
was not observed in terminating the respondent. However, the NLRC did not rule on the issue of
reimbursement of placement fees for lack of jurisdiction. The National Labor Relations
Commission awarded respondent only three (3) months worth of salary in the amount of
NT$46,080, the reimbursement of the NT$3,000 withheld from her, and attorney’s fees of
NT$300.

A MR was filed by the agency but was then denied. Aggrieved by the ruling, SOPA filed a Petition
for Certiorari with the CA. The CA affirmed the decision of the NLRC but also remanded the case
to the NLRC to address the validity of petitioner’s allegations against Pacific. Dissatisfied, SOPA
filed this Petition for Review on Certiorari

ISSUES:

1. Whether CA erred when it affirmed the ruling of NLRC finding respondent illegally
dismissed
2. Whether Joy Cabiles is entitled to the unexpired portion of her salary

HELD:

1. No, the CA did not erred in affirming NLRC’s ruling that Joy Cabiles was illegally
dismissed.

Sameer Overseas Placement Agency failed to show that there was just cause for causing Joy’s
dismissal. The employer Wacoal, also failed to accord her due process of law.

Management prerogative is recognized in law and in our jurisprudence.This prerogative, however,

should not be abused. It is “tempered with the employee’s right to security of tenure.” Workers are
entitled to substantive and procedural due process before termination. They may not be removed
from employment without a valid or just cause as determined by law and without going through
the proper procedure. By our laws, overseas Filipino workers (OFWs) may only be terminated for
a just or authorized cause and after compliance with procedural due process requirements.
Article 282 of the Labor Code enumerates the just causes of termination by the employer.

Art. 282. Termination by employer. An employer may terminate an employment for any of the
following causes:
(a) Serious misconduct or willful disobedience by the employee of the lawful orders of his
employer or representative in connection with his work;
(b) Gross and habitual neglect by the employee of his duties;
(c) Fraud or willful breach by the employee of the trust reposed in him by his employer or duly
authorized representative;
(d) Commission of a crime or offense by the employee against the person of his employer or any
immediate member of his family or his duly authorized representatives;
(e) Other causes analogous to the foregoing.

Petitioner’s allegation that respondent was inefficient in her work and negligent in her duties may,
therefore, constitute a just cause for termination under Article 282 but only if petitioner was able
to prove it.

The burden of proving that there is just cause for termination is on the employer. “The employer
must affirmatively show rationally adequate evidence that the dismissal was for a justifiable
cause.” Failure to show that there was valid or just cause for termination would necessarily mean
that the dismissal was illegal.

To show that dismissal resulting from inefficiency in work is valid, it must be shown that: 1) the
employer has set standards of conduct and workmanship against which the employee will be
judged; 2) the standards of conduct and workmanship must have been communicated to the
employee; and 3) the communication was made at a reasonable time prior to the employee’s
performance assessment. In this case, petitioner merely alleged that respondent failed to
comply with her foreign employer’s work requirements and was inefficient in her work. No
evidence was shown to support such allegations. Petitioner did not even bother to specify what
requirements were not met, what efficiency standards were violated, or what particular acts of
respondent constituted inefficiency.

There was also no showing that respondent was sufficiently informed of the standards against
which her work efficiency and performance were judged. The parties’ conflict as to the position
held by respondent showed that even the matter as basic as the job title was not clear.

Also, the petitioner failed to comply with the due process requirements.

The law requires the employer to give the charged employee at least two written notices before
termination. One of the written notices must inform the employee of the particular acts that may
cause his or her dismissal.The other notice must “[inform] the employee of the employer’s
decision. Aside from the notice requirement, the employee must also be given “an opportunity to
be heard.

Petitioner failed to comply with the twin notices and hearing requirements. Respondent
started working on June 26, 1997. She was told that she was terminated on July 14, 1997 effective
on the same day and barely a month from her first workday. She was also repatriated on the same
day that she was informed of her termination. The abruptness of the termination negated any
finding that she was properly notified and given the opportunity to be heard. Her constitutional
right to due process of law was violated.
2. Yes, the award of the three-month equivalent of respondent’s salary should be increased
to the amount equivalent to the unexpired term of the employment contract.

In Serrano v. Gallant Maritime Services, Inc. and Marlow Navigation Co., Inc., the court ruled that
the clause “or for three (3) months for every year of the unexpired term, whichever is less” is
unconstitutional for violating the equal protection clause and substantive due process.

A statute or provision which was declared unconstitutional is not a law. It “confers no rights; it
imposes no duties; it affords no protection; it creates no office; it is inoperative as if it has not been
passed at all.”

The Court said that they are aware that the clause “or for three (3) months for every year of the
unexpired term, whichever is less” was reinstated in Republic Act No. 8042 upon promulgation of
Republic Act No. 10022 in 2010.

Ruling on the constitutional issue: In the hierarchy of laws, the Constitution is supreme. No
branch or office of the government may exercise its powers in any manner inconsistent with the
Constitution, regardless of the existence of any law that supports such exercise. The Constitution
cannot be trumped by any other law. All laws must be read in light of the Constitution. Any law
that is inconsistent with it is a nullity.

Thus, when a law or a provision of law is null because it is inconsistent with the Constitution,
the nullity cannot be cured by reincorporation or reenactment of the same or a similar law or
provision. A law or provision of law that was already declared unconstitutional remains as such
unless circumstances have so changed as to warrant a reverse conclusion.

The Court observed that the reinstated clause, this time as provided in Republic Act. No. 10022,
violates the constitutional rights to equal protection and due process.96 Petitioner as well as the
Solicitor General have failed to showany compelling change in the circumstances that would
warrant us to revisit the precedent.
The Court declared, once again, the clause, “or for three (3) months for every year of the unexpired
term, whichever is less” in Section 7 of Republic Act No. 10022 amending Section 10 of Republic
Act No. 8042 is declared unconstitutional and, therefore, null and void.
Along the same line, the court held that the reinstated clause violates due process rights. It is
arbitrary as it deprives overseas workers of their monetary claims without any discernable valid
purpose.

Joy Cabiles is entitled to her salary for the unexpired portion of her contract, in accordance with
Section 10 of Republic Act No. 8042. The award of the three-month equivalence of respondent’s
salary must be modified accordingly. Since she started working on June 26, 1997 and was
terminated on July 14, 1997, respondent is entitled to her salary from July 15, 1997 to June 25,
1998. “To rule otherwise would be iniquitous to petitioner and other OFWs, and would, in
effect, send a wrong signal that principals/employers and recruitment/manning agencies may
violate an OFW’s security of tenure which an employment contract embodies and actually
profit from such violation based on an unconstitutional provision of law.”

NOTE (Namention kasi ito sa case) :)

*Doctrine of lex loci contractus (the law of the place where the contract is made) governs in
this jurisdiction. Namention yung doctrine na ito since wineigh nila kung mag aapply ba yung
Labor Code or yung laws ng Taiwan. Since sa Philippines naperfect yung contract, then the
provisions of the Labor Code applies to this case
ARRIOLA VS PILIPINO STAR - OBRA
FACTS: In 2002 Arriola filed an illegal dismissal complaint non-payment of salaries/wages,
moral and exemplary damages, actual damages, attorney's fees, and full backwages with the
National Labor Relations Commission. Arriola held various positions in Pilipino Star Ngayon, Inc.
before becoming a section editor and writer of its newspaper. He wrote "Tinig ng Pamilyang
OFWs" until his column was removed from publication on November 15, 1999. He contends that
he is a regular employee and the removal of his column amounted to an arbitrary dismissal of his
services as an employee. To prove his claim, he presented statement of account allegedly faxed to
him by Pilipino Star Ngayon, Inc. which showed a computation of his separation pay as of
November 30, 1999.

Pilipino Star Ngayon defends that there was no illegal dismissal instead Arriola suddenly absented
himself from work and never returned despite phone calls and beeper messages. After a few
months, they learned that Arriola transferred to a rival newspaper publisher, Imbestigador, to write
"Boses ng Pamilyang OFWs.
ISSUES:
1. Whether the money claim has already prescribed.
2. Whether Arriola has been illegally dismissed.
Ruling of the Labor Arbiter: DISMISSED FOR LACK OF MERIT

Laches had set in, emphasizing that Arriola took three years and one day to file his complaint. This
was "contrary to the immediate and natural reaction of an aggrieved person." If Arriola were indeed
aggrieved, he would not have waited three years and one day to sue Pilipino Star Ngayon, Inc. It
was also found that Arriola abandoned his employment with Pilipino Star Ngayon, Inc. to write
for a rival newspaper publisher. The money claims were judged to be prescribed since the Labor
Code provides that all money claims arising from employer-employee relations be filed three years
from the time the cause of action accrued.
Ruling of the Court of Appeals upon Review for Certiorari: Dismissed the petition and
affirmed the decision of the LA.
Ruling of the Supreme Court: The Supreme Court denied the petition and affirmed the decision
of the Court of Appeals. It ruled that money claims do not prescribe in three years but there was
no illegal dismissal in the present case. There was abandonment of employment, hence even if the
money claims have not yet prescribed, there is no cause of action to demand for such
1. Money claims arising from illegal dismissal prescribes in 4, not 3 years. Although illegal
dismissal is a violation of the Labor Code, it is not the "offense" contemplated in Article 290.
Article 290 refers to illegal acts penalized under the Labor Code, including committing any of the
prohibited activities during strikes or lockouts, unfair labor practices, and illegal recruitment
activities. The three-year prescriptive period under Article 290 does not apply to complaints for
illegal dismissal. By way of supplement," Article 1146 of the Civil Code of the Philippines governs
complaints for illegal dismissal. Under Article 1146, an action based upon an injury to the rights
of a plaintiff must be filed within four years.

Arriola’s claims for backwages, damages, and attorney’s fees arising from his claim of illegal
dismissal have not yet prescribed when he filed his complaint with the Regional Arbitration Branch
for the National Capital Region ofthe National Labor Relations Commission. The prescriptive
period for filing an illegal dismissal complaint is four years from the time the cause of action
accrued. Since an award of backwages is merely consequent to a declaration of illegal dismissal,
a claim for backwages likewise prescribes in four years.
2. Arriola is not illegally dismissed, instead, he abandoned his employment. The removal of
Arriola’s column from private respondent is not tantamount to a termination of his employment as
his job is not dependent on the existence of his column. Arriola remained as section editor.
Moreover, a newspaper publisher has the management prerogative to determine what columns to
print in its newspaper. Arriola abandoned his employment with Pilipino Star Ngayon, Inc.
Abandonment is the "clear, deliberate and unjustified refusal of an employee to continue his
employment, without any intention of returning." It has two elements: first, the failure to report
for work or absence without valid or justifiable reason and, second, a clear intention to sever
employer-employee relations exists. The second element is "the more determinative factor and is
manifested by overt acts from which it may be deduced that the employee has no more intention
to work.

Sto. Tomas VS SALAC - PADRIGO

Facts: On June 7, 1995 Congress enacted Republic Act (R.A.) 8042 or the Migrant Workers and
Overseas Filipinos Act of 1995 that, for among other purposes, sets the Government’s policies on
overseas employment and establishes a higher standard of protection and promotion of the welfare
of migrant workers, their families, and overseas Filipinos in distress.

Sections 29 and 30 of the Act1 commanded the Department of Labor and Employment (DOLE) to
begin deregulating within one year of its passage the business of handling the recruitment and
migration of overseas Filipino workers and phase out within five years the regulatory functions of
the Philippine Overseas Employment Administration (POEA).

On January 8, 2002 respondents Rey Salac, Willie D. Espiritu, Mario Montenegro, Dodgie
Belonio, Lolit Salinel, and Buddy Bonnevie (Salac, et al.) filed a petition for certiorari, prohibition
and mandamus with application for temporary restraining order (TRO) and preliminary injunction
against petitioners, the DOLE Secretary, the POEA Administrator, and the Technical Education
and Skills Development Authority (TESDA) Secretary-General before the Regional Trial Court
(RTC) of Quezon City, Branch 96.
Salac, et al. sought to: 1) nullify DOLE Department Order 10 (DOLE DO 10) and POEA
Memorandum Circular 15 (POEA MC 15); 2) prohibit the DOLE, POEA, and TESDA from
implementing the same and from further issuing rules and regulations that would regulate the
recruitment and placement of overseas Filipino workers (OFWs); and 3) also enjoin them to
comply with the policy of deregulation mandated under Sections 29 and 30 of Republic Act 8042.

On March 20, 2002 the Quezon City RTC granted Salac, et al.’s petition and ordered the
government agencies mentioned to deregulate the recruitment and placement of OFWs.3 The RTC
also annulled DOLE DO 10, POEA MC 15, and all other orders, circulars and issuances that are
inconsistent with the policy of deregulation under R.A. 8042.

Prompted by the RTC’s above actions, the government officials concerned filed the present
petition in G.R. 152642 seeking to annul the RTC’s decision and have the same enjoined pending
action on the petition.

On April 17, 2002 the Philippine Association of Service Exporters, Inc. intervened in the case
before the Court, claiming that the RTC March 20, 2002 Decision gravely affected them since it
paralyzed the deployment abroad of OFWs and performing artists. The Confederated Association
of Licensed Entertainment Agencies, Incorporated (CALEA) intervened for the same purpose.

On May 23, 2002 the Court5 issued a TRO in the case, enjoining the Quezon City RTC, Branch
96, from enforcing its decision.

Issue: Whether or not Sections 29 and 30 are valid.

Held: The issue became moot and academic. It appears that during the pendency of this case in
2007, RA 9422 (An Act to Strengthen the Regulatory Functions of the POEA) was passed which
repealed Sections 29 and 30 of RA 8042.

UNILEVER PHILS VS RIVERA - PEÑA

FACTS: Unilever is a company engaged in the production, manufacture, sale, and distribution of
various food, home and personal care products, while Rivera was employed as its Area Activation
Executive for Area 9 South in the cities of Cotabato and Davao. She was primarily tasked with
managing the sales, distribution and promotional activities in her area and supervising
Ventureslink International, Inc. (Ventureslink), a third party service provider for the company’s
activation projects. Unilever enforces a strict policy that every trade activity must be accompanied
by a Trade Development Program (TDP) and that the allocated budget for a specific activity must
be used for such activity only.

Unilever’s internal auditor conducted a random audit and found out that there were fictitious
billings and fabricated receipts supposedly from Ventureslink amounting to ₱11,200,000.00. It
was also discovered that some funds were diverted from the original intended projects. Upon
further verification, Ventureslink reported that the fund deviations were upon the instruction of
Rivera.

Unilever issued a show-cause notice to Rivera asking her to explain. Rivera admitted the fund
diversions, but explained that such actions were mere resourceful utilization of budget because of
the difficulty of procuring funds from the head office. Through a letter, Unilever found Rivera
guilty of serious breach of the company’s Code of Business Principles compelling it to sever their
professional relations. In a letter, Rivera asked for reconsideration and requested Unilever to allow
her to receive retirement benefits having served the company for fourteen (14) years already.
Unilever denied her request, reasoning that the forfeiture of retirement benefits was a legal
consequence of her dismissal from work.

Rivera filed a complaint for Illegal Dismissal and all money claims are dismissed by the Labor
Arbiter for lack of merit. On appeal, the NLRC partially granted Rivera’s prayer. That although
she was legally dismissed from the service for a just cause, Unilever was guilty of violating the
twin notice requirement in labor cases. Thus, Unilever was ordered to pay her ₱30,000.00 as
nominal damages, retirement benefits and separation pay.

Unilever asked for a reconsideration of the NLRC decision. The NLRC modified its earlier ruling
by deleting the award of separation pay and reducing the nominal damages from ₱30,000.00 to
₱20,000.00, but affirmed the award of retirement benefits to Rivera.

Unsatisfied with the ruling, Unilever elevated the case to CA-Cagayan de Oro City via a petition
for certiorari under Rule 65 of the Rules of Court.

The CA affirmed with modification the NLRC resolution. CA explained that, that there was no
proof that she personally gained any pecuniary benefit from her infractions, as her instructions
were aimed at increasing the sales efficiency of the company and competing in the local market.
For said reason, the CA awarded separation pay in her favor as a measure of social justice.

ISSUE: THE COURT OF APPEALS SERIOUSLY ERRED AND GRAVELY ABUSED ITS
DISCRETION IN AWARDING SEPARATION PAY IN FAVOR OF RIVERA CONSIDERING
THAT THE LATTER WAS VALIDLY DISMISSED FROM EMPLOYMENT BASED ON
JUST CAUSES UNDER THE LAW.

RULING: As a general rule, an employee who has been dismissed for any of the just causes
enumerated under Article 28215 of the Labor Code is not entitled to a separation pay
In exceptional cases, however, the Court has granted separation pay to a legally dismissed
employee as an act of "social justice" or on "equitable grounds." In both instances, it is required
that the dismissal (1) was not for serious misconduct; and (2) did not reflect on the moral character
of the employee. We hold that henceforth separation pay shall be allowed as a measure of social
justice only in those instances where the employee is validly dismissed for causes other than
serious misconduct or those reflecting on his moral character. The policy of social justice is not
intended to countenance wrongdoing simply because it is committed by the underprivileged. At
best, it may mitigate the penalty but it certainly will not condone the offense. This great policy of
our Constitution is not meant for the protection of those who have proved they are not worthy of
it, like the workers who have tainted the cause of labor with the blemishes of their own character.

ALILING VS FELICIANO GR No. 185829 – FLORA

FACTS: Armando Aliling was an employee of Wide Wide World Express Corporation
(WWWEC) with the position of Account Executive (Seafreight Sales). Aliling signed the
employment contract which expressly provided the following conditions:

1. That he was only a probationary employee for the first 6 months, and that his performance
during the probationary period shall be made as basis for confirmation to Regular or
Permanent Status;

2. That the 5th month Performance Appraisal shall be the basis in elevating or confirming his
employment status from Probationary to Regular; and

3. That upon his failure to meet the job requirements during the probation stage, his services
may be terminated without prior notice and without recourse to separation pay.

When training started, Aliling was assigned to handle Ground Express (GX) instead of the
Seafreight Sales assignment, as was originally agreed upon. GX is a new company product of
WWWEC, which Aliling was tasked to market and find daily contracts for.

Barely a month after, the WWWEC Sales and Marketing Director Manuel San Mateo III e-mailed
Aliling to express his dissatisfaction with Aliling’s performance. San Mateo expressed that Aliling
should meet his quota by 80% by then. Aliling interpreted the e-mail as a statement that San Mateo
was forcing him to resign.

A few days after, Aliling received a letter from the Human Resources Department (HRD) asking
him to report to the HRD to explain his absence taken without leave. Aliling sent his reply-letter
denying that he was absent on the days in question, and asking why his salary on the days when
he was alleged to be absent were withheld.
On September 27, 2004, Aliling wrote again to San Mateo stating that he is resigning from his job,
effective on October 15, 2004. WWWEC ignored the resignation. Even when WWWEC ignored
his resignation, Aliling wrote a letter on October 1, 2004 demanding reinstatement and a written
apology from the management for San Mateo’s letter forcing him to resign.

On October 6, 2004, Aliling was officially terminated due to his non-satisfactory performance
during his probationary period. But on October 4, 2004, Aliling already filed a Complaint for
illegal dismissal due to forced resignation, nonpayment of salaries as well as damages with the
NLRC against WWWEC.

Aliling’s contentions: He was illegally dismissed because at the time of his engagement,
WWWEC did not make known to him the standards under which he will qualify as a regular
employee.
WWWEC’s contentions: Aliling signed the employment contract stating that failure to meet the
job requirements during the probation stage means that his services may be terminated without
prior notice and without recourse to separation pay. San Mateo also gave a memo to Aliling about
his 80% sales quota, thus Aliling was given a reasonable standard upon which his performance
would be evaluated.
LA’s Ruling: Aliling’s termination is unjustified because his termination was not for a just cause.
Also, Aliling is a regular employee, not a probationary employee because there is no prior advisory
of the reasonable standards upon which his performance would be evaluated.
NLRC affirmed LA’s decision.

CA: Affirmed NLRC’s decision. It only modified the award for damages.

Issues and Ruling

1. Was Aliling a probationary employee or a regular employee? If so, was he illegally

dismissed?

Aliling is a regular employee because WWWEC did not inform him of the reasonable standards
by which his probation would be measured against AT THE TIME OF HIS ENGAGEMENT. The
Labor Code specifically requires the employer to inform the probationary employee of the
reasonable standards at the time of his engagement, not at any time later; else, the employee shall
be considered a regular employee.

The reasonable performance standard was not reached as Aliling, originally hired and trained at
Seafreight Sales, was transferred to GX which had an entirely different standard. Thus, he was not
informed of the performance standard at the time of his engagement, not even at a later time.
Yes. Aliling was illegally dismissed because WWWEC did not prove that his dismissal was for a
just causes, and that the employee was afforded due process prior to the dismissal. It is a
complementary principle that an employer has the onus of proving with clear, accurate, consistent,
and convincing evidence the validity of the dismissal.

The reason for termination was that Aliling failed to achieve his quota. WWWEC claims that they
gave Aliling a memo that he didn’t reach his quota, but aliling denies having received such memo.
WWWEC has failed to refute Aliling’s contention of non-receipt of the memo, resulting to
WWWEC not really giving a just reason for dismissing Aliling.

Q: Is failing to meet the sales quota a just cause for termination?

A: Yes. Failing to meet the sales quota is a just cause for termination, but in order for it to be a just
cause for termination, it must be shown that such sales quota was imposed in good faith.
WWWEC failed to show that it imposed Aliling’s sales quota in good faith. From the findings, it
can be inferred that the imposed sales quota on Aliling was a desperate attempt to show that
Aliling’s dismissal was valid.

2. Was Aliling’s right to due process violated?

Yes. Aliling’s right to due process was violated because WWWEC could not prove that the memo
was received by Aliling, thus the FIRST NOTICE REQUIREMENT was not complied with.
Neither was Aliling afforded an opportunity of a hearing or conference. In order for the procedural
due process to be fulfilled, the two-written notice rule must be followed.

3. What reliefs can Aliling be entitled to?

Aliling is entitled to backwages and separation pay, not reinstatement.

Since Aliling is decided to be a regular employee without a fixed term of employment, he is entitled
to backwages reckoned from the time he was illegally dismissed on October 6, 2004. Additionally,
Aliling is entitled to separation pay instead of reinstatement because there is already a strained
relationship between him and WWWEC.

Mantle Trading Services v NLRC - FOLLANTE

FACTS: Mantle Trading Services Inc is engaged in fishing business. Madriaga was hired by
petitioner as batilyo (fish hauler) subsequently he became a tagapuno(someone who fills tub with
fish). He worked from 6:00 p.m. up to 6:00 a.m. the following day with a daily pay of P150.00.
Madriaga was reported by Gallos, a fish broker, to have received money from a fish trader, Mr.
Edwin Alfaro. As consideration, Madriaga would put more fish in Alfaros tubs.For the second
time, He was again reported to have received money from Alfaro for the same illicit purpose. In
both incidents, formal incident reports were submitted to the company. Madriaga was allegedly
barred by the payroll master, Mr. Charlie Baqued, from reporting for work. The company, on the
other hand, alleged that Madriaga abandoned his work when he was about to be investigated for
the two incident reports.

Madriaga filed a complaint with the Regional Office DOLE NCR against petitioners, for illegal
dismissal, underpayment of wages and nonpayment of holiday pay, 13th month pay, overtime pay,
service incentive leave pay and night shift differential pay.

ISSUE: WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED WHEN IT

HELD THAT PRIVATE RESPONDENT WAS ILLEGALLY DISMISSED BECAUSE
PETITIONER DID NOT COMPLY WITH THE NOTICE REQUIREMENT DESPITE ITS
FINDING OF ABANDONMENT OF WORK.

HELD: It is settled that to effect a valid dismissal, the law requires that a) there be just and valid
cause as provided under Article 282 of the Labor Code; and b) the employee be afforded an
opportunity to be heard and to defend himself. The two-notice requirement must be complied with,
to wit: a) a written notice containing a statement of the cause for the termination to afford the
employee ample opportunity to be heard and defend himself with the assistance of his
representative, if he so desires; and b) if the employer decides to terminate the services of the
employee, the employer must notify him in writing of the decision to dismiss him, stating clearly
the reason.

The dismissal was found by the Court to be based on a just cause because the employee abandoned
his work. But it also found that the employer did not follow the notice requirement demanded by
due process. It ruled that this violation of due process on the part of the employer did not nullify
the dismissal, or render it illegal, or ineffectual. Nonetheless, the employer was ordered to
indemnify the employee for the violation of his right to due process. It further held that the penalty
should be in the nature of indemnification, in the form of nominal damages and should depend on
the facts of each case, taking into special consideration the gravity of the due process violation of
the employer.

WILGEN LOON vs. POWER MASTER INC.

- SAAVEDRA
FACTS: Respondents Power Master, Inc. and Tri-C General Services employed and assigned the
petitioners as janitors and leadsmen in various Philippine Long Distance Telephone Company
(PLDT) offices in Metro Manila area. Subsequently, the petitioners filed a complaint for illegal
dismissal and money claims against Power Master, Inc., Tri-C General Services and their officers,
the spouses Homer and Carina Alumisin (collectively, the respondents). The petitioners alleged in
their complaint that they were not paid minimum wages, overtime, holiday, premium, service
incentive leave, and thirteenth month pays. They further averred that the respondents made them
sign blank payroll sheets.
The respondents did not participate in the proceedings before the Labor Arbiter except on April
19, 2001 and May 21, 2001 when Mr. Romulo Pacia, Jr. appeared on the respondents’ behalf. The
respondents’ counsel also appeared in a preliminary mandatory conference on July 5, 2001.
However, the respondents neither filed any position paper nor proffered pieces of evidence in their
defense despite their knowledge of the pendency of the case.
The Labor Arbiter partially ruled in favor of the petitioners. The LA awarded the petitioners salary
differential, service incentive leave, and thirteenth month pays. But, the LA denied the petitioners’
claims for backwages, overtime, holiday, and premium pays. The LA observed that the petitioners
failed to show that they rendered overtime work and worked on holidays and rest days without
compensation. The LA further concluded that the petitioners cannot be declared to have been
dismissed from employment because they did not show any notice of termination of employment.
They were also not barred from entering the respondents’ premises.

The NLRC partially ruled in favor of the respondents. It allowed the respondents to submit pieces
of evidence for the first time on appeal on the ground that they had been deprived of due process.
It found that the respondents did not actually receive the LA’s processes. It also admitted the
respondents’ unverified supplemental appeal on the ground that technicalities may be disregarded
to serve the greater interest of substantial due process. Ultimately, it vacated the LA’s prior award
of salary differential, thirteenth month and service incentive leave pays.

The NLRC further ruled that the petitioners were lawfully dismissed on grounds of serious
misconduct and willful disobedience. It found that the petitioners failed to comply with various
memoranda directing them to transfer to other workplaces and to attend training seminars for the
intended reorganization and reshuffling.

The CA affirmed the NLRC’s ruling.

ISSUE: Was the NLRC correct in admitting the evidence on appeal?

HELD: No, because the respondents were not able to explain why they incurred delay in the
presentation of evidence, nor disprove the allegations against them, therefore, not complying with
the requisites to validly invoke the liberality of the procedural rules.

The liberality of procedural rules is qualified by two requirements: (1) a party should adequately
explain any delay in the submission of evidence; and (2) a party should sufficiently prove the
allegations sought to be proven.30 The reason for these requirements is that the liberal application
of the rules before quasi-judicial agencies cannot be used to perpetuate injustice and hamper the
just resolution of the case. Neither is the rule on liberal construction a license to disregard the rules
of procedure.

The respondents’ delay was anchored on their assertion that they were oblivious of the proceedings
before the LA. However, the respondents did not dispute the LA’s finding that Mr. Romulo Pacia,
Jr. appeared on their behalf on April 19, 2001 and May 21, 2001. The NLRC capriciously and
whimsically admitted and gave weight to the respondents’ evidence despite its finding that they
voluntarily appeared in the compulsory arbitration proceedings.

Furthermore, the respondents failed to sufficiently prove the allegations sought to be proven. Why
the respondents’ photocopied and computerized copies of documentary evidence were not
presented at the earliest opportunity is a serious question that lends credence to the petitioners’
claim that the respondents fabricated the evidence for purposes of appeal. While such may be
admitted in evidence, allegations of forgery and fabrication should prompt the adverse party to
present the original documents for inspection. The respondents’ failure to present the originals
raises the presumption that evidence willfully suppressed would be adverse if produced.

The CA was found to have acted with grave abuse of discretion by affirming the NLRC decision.
Apart from the overtime and premium pay, all other reliefs the petitioners asked were granted to
them.
SAN MIGUEL CORPORATION, vs. PROSPERO A. ABALLA, BONNY J. ABARING,
EDWIN M. ADLA-ON, et al.
G.R. No. 149011 - GONADAN
Doctrine:
Art. 284. Closure of establishment and reduction of personnel. — The employer may also
terminate the employment of any employee due to the installation of labor-saving devices,
redundancy, retrenchment to prevent losses or the closing or cessation of operation of the
establishment or undertaking unless the closing is for the purpose of circumventing the provisions
of this title, by serving a written notice on the workers and the Ministry of Labor and Employment
at least one (1) month before the intended date thereof. In case of termination due to the installation
of labor-saving devices or redundancy, the worker affected thereby shall be entitled to a separation
pay equivalent to at least his one (1) month pay or to at least one (1) month pay for every year of
service, whichever is higher. In case of retrenchment to prevent losses and in cases of closure or
cessation of operations of establishment or undertaking not due to serious business losses or
financial reverses, the separation pay shall be equivalent to one (1) month pay or at least one-half
(1/2) month pay for every year of service whichever is higher. A fraction of at least six (6) months
shall be considered one (1) whole year.
FACTS: On June 27, 1960, herein petitioner Rosalina Perez Abella leased a farm land in
Monteverde, Negros Occidental, known as Hacienda Danao-Ramona, for a period of ten (10)
years, renewable, at her option, for another ten (10) years. On August 13, 1970, she opted to extend
the lease contract for another ten (10) years During the existence of the lease, she employed the
herein private respondents. Private respondent Ricardo Dionele, Sr. has been a regular farm worker
since 1949 and he was promoted to Cabo in 1963. On the other hand, private respondent Romeo
Quitco started as a regular employee in 1968 and was promoted to Cabo in November of the same
year. Upon the expiration of her leasehold rights, petitioner dismissed private respondents and
turned over the hacienda to the owners thereof on October 5, 1981, who continued the
management, cultivation and operation of the farm.
On November 20, 1981, private respondents filed a complaint against the petitioner for overtime
pay, illegal dismissal and reinstatement with backwages.
Labor Arbiter Manuel M. Lucas, Jr., in a Decision dated July 16, 1982, ruled that the dismissal is
warranted by the cessation of business, but granted the private respondents separation pay. The
First Division of this Court, in a Resolution dated March 31, 1986, resolved to give due course to
the petition; and to require the parties to submit simultaneous memoranda. In compliance
therewith, the Solicitor General filed his Memorandum on June 18, 1986 and petitioner on July
23, 1986.
Issue: Whether respondents are entitled to separation pay.

Ruling: Yes. Art. 284. Closure of establishment and reduction of personnel.There is no question
that Article 284 of the Labor Code as amended by BP 130 is the law applicable in this case. The
purpose of Article 284 as amended is obvious-the protection of the workers whose employment is
terminated because of the closure of establishment and reduction of personnel. Without said law,
employees like private respondents in the case at bar will lose the benefits to which they are entitled
— for the thirty three years of service in the case of Dionele and fourteen years in the case of
Quitco. Although they were absorbed by the new management of the hacienda, in the absence of
any showing that the latter has assumed the responsibilities of the former employer, they will be
considered as new employees and the years of service behind them would amount to nothing.
GARDEN OF MEMORIES PARK AND LIFE PLAN, INC & PAULINA T. REQUINO VS
NLRC, LA GARDUQUE AND HILARI CRUZ - TOYOKEN
FACTS: GARDEN OF Memories is operating a memorial park while Cruz is a utility worker of
the institution who worked from August 1991 until her termination in February 1998. On March
13, 1998, Cruz filed a complaint for illegal dismissal, underpayment of wages, non-inclusion in
the Social Security Services, and non-payment of legal/special holiday, premium pay for rest day,
13 month pay and SIL against Garden Memories before the DOLE. Upon motion of Garden
th

Memories, Requino was impleaded as respondent on the alleged ground that she was its service
contractor and the employer of Cruz.

Cruz averred that she had a misunderstanding with a co-worker regarding the use of a garden hose,
and when it came to the knowledge of Requino, Requino instructed them to go home and not return
anymore. Three days later when Cruz reported for work, she was told that she has been replaced.
She immediately reported the matter of her replacement to the personnel manager of Garden
Memories and manifested her protest.
Cruz’ Contention: As a regular employee of the Garden of Memories, she could not be
terminated without just or valid cause. Also, her dismissal was violative of due process as she was
not afforded the opportunity to explain her side before her employment was terminated
Garden Memories’ Contention: It’s not liable for the claim of Cruz because the employer of
Cruz is not Garden Memories but Requino, its independent service contractor, who maintained the
park for a contract price. It insisted that there was no employer-employee relationship between
them because she was employed by its service contractor.

Requino’s Contention: She prayed for the dismissal of the complaint stating that it was
Victoriana, her mother, who hired Cruz, and she merely took over the supervision and management
of the workers of the memorial park when her mother got ill. She claimed that the ownership of
the business was never transferred to her.
LA DECISION: Requiño was not an independent contractor but a labor-only contractor and that
her defense that Cruz abandoned her work was negated by the filing of the present case.The LA
declared both Garden of Memories and Requiño, jointly and severally, liable for the monetary
claims of Cruz.

Garden of Memories and Requiño appealed the decision to the NLRC.

NLRC Decision: NLRC affirmed the ruling of the LA, stating that Requiño had no substantial
capital or investments in the form of tools, equipment, machineries, and work premises, among
others, for her to qualify as an independent contractor. It declared the dismissal of Cruz illegal
reasoning out that there could be no abandonment of work on her part since Garden of Memories
and Requiño failed to prove that there was a deliberate and unjustified refusal on the part of the
employee to go back to work and resume her employment.

Garden of Memories moved for a reconsideration of the NLRC decision but it was denied for lack
of merit.
Consequently, Garden of Memories and Requiño filed before the CA a petition for certiorari under
Rule 65 of the Rules of Court. In its June 11, 2003 Decision, the CA dismissed the petition and
affirmed the NLRC decision. Hence, they filed a petition for review under Rule 45.

ISSUE: Is there an employer-employee relationship between Cruz and Garden of Memories?

RULING: Yes. The contention of Garden Memories that Requino is the employer of Cruz,
Requino being the service contractor of Garden of Memories is misplaced. In the case, Requino is
engaged in labor-only contracting and is considered merely an agent of Garden of Memories. As
such, the workers she supplies should be considered as employees of Garden of Memories.
Consequently, the latter, as principal employer, is responsible to the employees of the labor-only
contractor as if such employees have been directly employed by it. Cruz was hired as a utility
worker tasked to clean, sweep and water the lawn of the memorial park. She performed activities
which were necessary or desirable to its principal trade or business. Thus, she was a regular
employee of Garden of Memories and cannot be dismissed except for just and authorized causes.

Moreover, the SC agrees with the findings of the lower tribunals that Cruz did not abandon her
work but was illegally dismissed.

As the employer, Garden of Memories has the burden of proof to show the employee's deliberate
and unjustified refusal to resume his employment without any intention of returning. For
abandonment to exist, two factors must be present: (1) the failure to report for work or absence
without valid or justifiable reason; and (2) a clear intention to sever employer-employee
relationship, with the second element as the more determinative factor being manifested by some
overt acts. It has been said that abandonment of position cannot be lightly inferred, much less
legally presumed from certain equivocal acts. Mere absence is not sufficient.
In this case, no such intention to abandon her work can be discerned from the actuations of Cruz.
Neither were there overt acts which could be considered manifestations of her desire to truly
abandon her work. On the contrary, her reporting to the personnel manager that she had been
replaced and the immediate filing of the complaint before the DOLE demonstrated a desire on her
part to continue her employment with Garden of Memories. As correctly pointed out by the CA,
the filing of the case for illegal dismissal negated the allegation of abandonment.

ISABELO VIOLETA and JOVITO BALTAZAR, petitioners, vs. NATIONAL LABOR

RELATIONS COMMISSION, Fifth Division, and DASMARINAS INDUSTRIAL AND
STEELWORKS CORPORATIONS, respondents. - MACATULAD

FACTS: Violeta and Baltazar were former employees of Dasmarias Industrial and Steelworks
Corporation (DISC). They were transferred from one project to another upon completion of a
certain project

Violeta worked in Construction and Development Corporation of the Philippines (CDCP), a sister
corporation of DISC, at its project in CDCP Mines, Basay, Negros Oriental (Dec 15, 1980 - Feb
15, 1981)

DISC then hired him as Erector II at the formers project for Philphos in Isabel, Leyte until the
termination of the project (Nov. 10,1982 - Dec 3, 1984)

He was reassigned as Erector II for Five Stand TCM Project, with vacation and sick leaves, and
was designated as a regular project employee at DISC’S project for National Steel Corporation
(NSC) in Iligan City (Jan 21,1985)

After receiving a salary adjustment, he was again hired as Handyman for the civil works of a
construction project for NSC (June 6, 1985)

He was appointed for project employment, again as Handyman, to NSC ETL #3 Civil Works by
DISC (Feb 10,1992).

Due to the completion of the particular item of work he was assigned to, DISC terminated the
services of Violeta on March 15, 1992.

Baltazar started in the employ of CDCP on June 23, 1980. He was hired by DISC as Lead Carpenter
for project Agua VII on October 1, 1981. Like Violeta, he was transferred from one project to
another as a regular project employee. On November 28, 1991, he was hired as Leadman II in
ETL #3 Civil Works by DISC in its project for NSC, but he was separated from such employment
on December 20, 1991 as a result of the completion of said item of work.)

VIOLETA and BALTAZAR: They are already regular employees who cannot be dismissed on
the ground of completion of the particular project where they are engaged. They filed two separate
complaints for illegal dismissal against DISC, with a prayer for reinstatement and back wages plus
damages.

DISC: Argued that both are project employees based on their declaration in their Appointments
for Project Employment that they are employed only for the period and specific works stated in
their respective appointments

Labor Arbiter Guardson A. Siao: Dismissed the claims of petitioners for lack of merit.
VIOLETA and BALTAZAR are project employees based on their admission that they are regular
project employees. Thus, their employment was deemed coterminous with the project for which
their employer engaged them.

Their separation was valid

NLRC(5th Div)
Reversed the decision of the LA.

Violeta and Baltazar are non-project employees.

They were illegal dismissed.

DISC was ordered to reinstate them or give separation pay, plus attys fees.

The fact that Violeta and Baltazar were hired and transferred from one project to another made
them non-project employees who cannot be terminated by reason alone of the completion of the
project. They were hired not only for one particular project but different projects, one after the
other.

NLRC(5th Div-Reversed it's own decision)

The employment of Violeta and Baltazar (in ETL #3 Civil Works) was allegedly for a specific or
fixed period thus making them project employees.

Even if they were categorized as regular project employees, their employment was not permanent
but coterminous with the projects to which they were assigned.

No other substantial reason was given.

ISSUE: Whether Violeta and Baltazar are regular (non-project) employees or project employees
SC: They are regular employees. The dismissal, therefore, could not be justified by the completion
of their items of work.

As Handyman and Erector II, respectively, Violeta’s and Baltazar’s services are both necessary
and vital to the operation of the business of DISC. This is confirmed by the fact that they were
continually and successively assigned to the different projects of DISC and its sister company,
CDCP.

The principal test for determining whether particular employees are project employees is
whether or not the project employees were assigned to carry out a specific project or undertaking,
the duration (and scope) of which were specified at the time the employees were engaged for
that project.

As defined, project employees are those workers hired (1) for a specific project or undertaking,
and (2) the completion or termination of such project or undertaking has been determined at the
time of engagement of the employee.

The predetermination of the duration or period of a project employment is important in resolving

whether one is a project employee or not.

There is no debate that petitioners were hired for a specific project or undertaking. The fact of the
completion of said item of work is also undisputed. However, the records are barren of any definite
period or duration for the expiration of the assigned items of work of petitioners at the time of their
engagement. Their appointments reveal that the completion or termination of the project for which
Violeta and Baltazar were hired was not determined at the start of their employment. There is no
specific mention of the period or duration when the project will be completed or terminated. In
fact, the lines for DATE OF COVERAGE in the appointments were left blank.

It is not enough that an employee is hired for a specific project or phase of work. There must also
be a determination of or a clear agreement on the completion or termination of the project at the
time the employee is engaged if the objective of Article 280 is to be achieved. Since this second
requirement was not met in this case, they should be considered as regular employees despite their
admissions and declarations that they are project employees.

Additional reasons why the case is ruled in favor of Violeta and Baltazar:
1) Nowhere in the records is there any showing that DISC reported the completion of its projects
and the dismissal of petitioners in its finished projects to the nearest Public Employment Office in
compliance with Policy Instruction No. 20 of then Labor Secretary Blas F. Ople.

The failure of an employer to report to the nearest Public Employment Office the termination of
its workers services every time a project or a phase thereof is completed indicates that said workers
are not project employees. In the case at bar, only the last and final termination was reported to the
aforementioned labor office.
DISC should have filed as many reports of termination as there were construction projects actually
finished if Violeta and Baltazar were indeed project employees, considering that they were hired
and again rehired for various projects or the phases of work therein. Its failure to submit reports of
termination cannot but sufficiently convince us further that they are truly regular employees.

2) The fact that petitioners had rendered more than one year of service at the time of their dismissal
overturns DISC’s allegations that Violeta and Baltazar were hired for a specific or a fixed
undertaking for a limited period of time.

FVR SKILLS AND SERVICES EXPONENTS, INC. (SKILLEX) vs. JOVERT SEVA, et al.
- MADRID
FACTS: The twenty-eight (28) respondents in this case were employees of FVR Skills and
Services Exponents, Inc. (SKILLEX), an independent contractor engaged in the business of
providing janitorial and other manpower services to its clients.

SKILLEX entered into a Contract of Janitorial Service8 (service contract) with Robinsons Land
Corporation (Robinsons). Both agreed that the SKILLEX shall supply janitorial, manpower and
sanitation services to Robinsons for a period of one year (from January 1, 2008 to December 31,
2008). The SKILLEX and Robinsons no longer extended their contract of janitorial services.
Consequently, the SKILLEX dismissed the respondents as they were project employees whose
duration of employment was dependent on the SKILLEX's service contract with Robinsons.

The respondents responded to the termination of their employment by filing a complaint for illegal
dismissal with the NLRC. They argued that they were not project employees; they were regular
employees who may only be dismissed for just or authorized causes. The respondents also asked
for payment of their unpaid wage differential, 13th month pay differential, service incentive leave
pay, holiday pay and separation pay.
ISSUE: Whether the respondents are regular employees and not project employees.
HELD: YES. The respondents are regular employees, not project employees.

Article 294 of the Labor Code governs the determination of whether an employee is a regular or a
project employee. Under this provision, there are two kinds of regular employees, namely: (1)
those who were engaged to perform activities which are usually necessary or desirable in the usual
business or trade of the employer; and (2) those casual employees who became regular after one
year of service, whether continuous or broken, but only with respect to the activity for which they
have been hired. On the other hand, a project employee is one whose employment was fixed for a
specific project or undertaking, whose completion or termination had been determined at the time
of engagement.

The respondents' work as janitors, service crews and sanitation aides, are necessary or desirable to
the SKILLEX's business of providing janitorial and manpower services to its clients as an
independent contractor.
Also, the respondents had already been working for the SKILLEX as early as 1998. Even before
the service contract with Robinsons, the respondents were already under the SKILLEX's employ.
They had been doing the same type of work and occupying the same positions from the time they
were hired and until they were dismissed in January 2009. The SKILLEX continuously availed of
their services by constantly deploying them to its clients.

Lastly, under Department Order (DO) 18-02, the applicable labor issuance to the SKILLEX's
case, the contractor or subcontractor is considered as the employer of the contractual employee for
purposes of enforcing the provisions of the Labor Code and other social legislation. DO 18-02
grants contractual employees all the rights and privileges due a regular employee, including the
following: (a) safe and healthful working conditions;(b) labor standards such as service incentive
leave, rest days, overtime pay, holiday pay, 13th month pay and separation pay; (c) social security
and welfare benefits; (d) self-organization, collective bargaining and peaceful concerted action;
and (e) security of tenure.

Therefore, although the respondents were assigned as contractual employees to the SKILLEX's
various clients, under the law, they remain to be the SKILLEX's regular employees, who are
entitled to all the rights and benefits of regular employment. Section 7 of DO 18-02 treats
contractual employees as the independent contractor's regular employees for purposes of
enforcing the Labor Code and other social legislation laws. Consequently, a finding of regular
employment entitles them to the rights granted to regular employees, particularly the right to
security of tenure and to separation pay. Thus, a holistic reading of DO 18-02, guides us to the
conclusion that Section 10 only pertains to contractual employees who are really project
employees. They are not entitled to separation pay since the end of the project for which they had
been hired necessarily results to the termination of their employment. On the other hand, we
already found that the respondents are the SKILLEX's regular employees. Thus, their illegal
dismissal entitles them to backwages and reinstatement or separation pay, in case
reinstatement is no longer feasible.