XVII. RUELAN, DARREN L.

129. NISSAN MOTORS PHIL., INC. v. SEC. OF LABOR AND EMPLOYMENT

G.R. No. 158190-91, June 21, 2006

FACTS: Respondent Union filed 4 notices of strike with the NCMB. The fist notice was on the ground of
alleged ULP for the suspension of about 140 company employees following the disruptive protest action
arising from its demand for payment of the second half of their 13th month pay. The second strike was on
the ground of bargaining deadlock. DOLE issued an order assuming jurisdiction over the dispute. The
union filed its third notice of strike on the ground of illegal lockout, illegal suspension, and union busing.
DOLE issued an order directing the strike to be consolidated with the first two notices reiterating the
injunction in the assumption of jurisdiction. The union then filed the fourth notice of strike on account of
the forced leave, coercion/intimidation, union busting, and nonpayment of salaries. DOLE issued an order
directing the strike to be consolidated with the three notices of strike reiterating the injunction in the
assumption of jurisdiction. Despite the injunctions, the Union went on actual strike, picketing, and
slowdown.

The DOLE secretary sustained the dismissal of the union officers and 140 company employees. CA
reinstated the 140 rank and file union members. Hence, this petition.

ISSUE: Whether or not CA gravely abused its discretion in ordering the reinstatement of the 1401 rank
and file members of the union?

RULING: NO. The union members have not committed any illegal acts during the strike notwithstanding
the illegality of the strike on account of its violation of DOLE’s injunction order.

While the employer is authorized to declare a union officer who participated in an illegal strike as having
lost his employment, his/its option is not as wide with respect to union members or workers for the law
itself draws a line and makes a distinction between union officers and members/ordinary workers. An
ordinary striking worker or union member cannot, as a rule, be terminated for mere participation in an
illegal strike; there must be proof that he committed illegal acts during the strike. And lest it be forgotten,
the law invests the Secretary of Labor and Employment the prerogative of tempering the consequence of
the defiance to the assumption order. The Secretary may thus merely suspend rather than dismiss the
employee involved.

CA acted within the bounds of the law and certainly rendered a judicious solution to the dispute when she
spared the striking workers or union members from the penalty of dismissal.

130. SUICO v. NLRC

G.R. No. 146762, January 30, 2007

FACTS: Petitioners are regular employees of the different branches of PLDT and members of MKP
union. The union launched a strike against PLDT in their different branches where the petitioners
participated. In the various strikes, several complaints were filed against the Petitioners by other
employees and subscriber of PLDT who sustained injuries and humiliation from the Petitioners during the
strikes. PLDT gave notices to the Petitioners requiring them to submit a notarized explanation why they
should not be terminated for committing the illegal acts. Petitioners replied to the notice by requesting
PLDT for a formal hearing. PLDT did not heed such request but instead sent their respective termination
notices. Petitioner filed a case for illegal dismissal.
ISSUE: Whether or not the due process requirement for the Petitioners dismissal was observed?

RULING: NO. PLDT does not deny the existence of its own company procedure in termination case.
Under this procedure, PLDT granted its employee the alternative of either filing a written answer to the
charges or requesting for opportunity to be heard and defend himself with the assistance of his counsel or
union representative, if he so desires. Petitioners exercised their option therein by requesting that a formal
hearing be conducted and that they be given copies of sworn statements and other pertinent documents to
enable them to prepare for the hearing. This option is part of their right to due process in which PLDT is
bound to comply. The procedure adopted by PLDT in dismissing Petitioners fell short of the requirements
of due process.

The procedure for termination under the Labor Code and the implementing rules is supplemented by
existing company policy and procedures. Company policies or practices are binding on the parties. Some
can ripen into an obligation on the part of the employer, such as those which confer benefits on
employees or regulate the procedures and requirements for their termination.

It should be emphasized, however, that, consistent with our ruling in Agabon, the procedural deficiency in
the dismissal of Petitioners did not affect the validity or effectivity of the dismissal as the substantive
bases thereof were never put in issue.

131. CHUAYUCO STEEL MANUFACTURING CORP. v. BUKLOD NG MANGGAGAWA SA

CHUAYUCO STEEL MANUFACTURING CORP.
G.R. No. 167347, January 31, 2007

FACTS: Respondent union declared and eventually staged a strike against Petitioner company on the
ground of ULP. Petitioner filed before the NLRC a Petition to Declare the strike illegal where it raised as
ground, among others, the unlawful means employed in staging the strike including padlocking and
putting up several structures and large stones before the gate to the premises of the company, thus
preventing free ingress and egress. Labor Arbiter declared the strike illegal and the individuals who led
and took active parts in the strike as having consequentially lost their employment status. The decision
was affirmed by the NLRC. CA modified the resolution of the NLRC where only the union officers were
declared to have lost their employment status and requiring the immediate reinstatement of several union
members. Hence, this petition.

ISSUE: 1. Whether or not the CA may review the findings of the NLRC

2. Whether or not the reinstatement was proper?

RULING: 1. YES. Ever since appeals from the NLRC to the Supreme Court were eliminated, the
legislative intendment was that the special civil action of certiorari was and still is the proper judicial
review of decisions of the NLRC. There is a growing number of labor cases being elevated to the Court,
which, not being a trier of facts, has at times been constrained to remand the case to the NLRC for
resolution of unclear or ambiguous factual findings; that the Court of Appeals is procedurally equipped
for that purpose.

While as a rule, factual findings of agencies exercising quasi-judicial functions such as the NLRC are
accorded not only respect but even finality, and that judicial review of labor cases does not go so far as to
evaluate the sufficiency of evidence on which the labor officials' findings rest; more so when both the
labor arbiter and the NLRC share the same findings. When the circumstances so warrant, the Court of
Appeals can disregard the factual findings of the NLRC. the Court cannot affirm the decision of the
NLRC when its findings of fact on which the conclusion was based are not supported by substantial
evidence.

2. NO. Aside from obstructing free ingress to and egress from petitioners premises, respondents members
also committed illegal acts which were intended to intimidate and harass petitioner and its non-striking
employees. The findings of the Labor Arbiter and NLRC are supported by substantial evidence that the
union members have committed illegal acts during the strike. Having shown to have committed illegal
acts during the strike, they have deemed lost their employment status.

Even if the purpose of the strike is valid, when the means employed were far from legitimate, such strike
is rendered illegal. Responsibilities for these illegal acts must be on an individual and not on collective
basis. A union officer may be declared to have lost his employment status if he knowingly participates in
an illegal strike, whereas a union member may be similarly faulted if he knowingly participates in the
commission of illegal acts during the strike.

132. CHUAYUCO STEEL MANUFACTURING CORP. v. BUKLOD NG MANGGAGAWA SA

CHUAYUCO STEEL MANUFACTURING CORP.
G.R. No. 167347, January 31, 2007

FACTS: Respondent union declared and eventually staged a strike against Petitioner company on the
ground of ULP. Petitioner filed before the NLRC a Petition to Declare the strike illegal where it raised as
ground, among others, the unlawful means employed in staging the strike including padlocking and
putting up several structures and large stones before the gate to the premises of the company, thus
preventing free ingress and egress. Labor Arbiter declared the strike illegal and the individuals who led
and took active parts in the strike as having consequentially lost their employment status. The decision
was affirmed by the NLRC. CA modified the resolution of the NLRC where only the union officers were
declared to have lost their employment status and requiring the immediate reinstatement of several union
members. Hence, this petition.

ISSUE: 1. Whether or not the CA may review the findings of the NLRC

2. Whether or not the reinstatement was proper?

RULING: 1. YES. Ever since appeals from the NLRC to the Supreme Court were eliminated, the
legislative intendment was that the special civil action of certiorari was and still is the proper judicial
review of decisions of the NLRC. There is a growing number of labor cases being elevated to the Court,
which, not being a trier of facts, has at times been constrained to remand the case to the NLRC for
resolution of unclear or ambiguous factual findings; that the Court of Appeals is procedurally equipped
for that purpose.

While as a rule, factual findings of agencies exercising quasi-judicial functions such as the NLRC are
accorded not only respect but even finality, and that judicial review of labor cases does not go so far as to
evaluate the sufficiency of evidence on which the labor officials' findings rest; more so when both the
labor arbiter and the NLRC share the same findings. When the circumstances so warrant, the Court of
Appeals can disregard the factual findings of the NLRC. the Court cannot affirm the decision of the
NLRC when its findings of fact on which the conclusion was based are not supported by substantial
evidence.

2. NO. Aside from obstructing free ingress to and egress from petitioners premises, respondents members
also committed illegal acts which were intended to intimidate and harass petitioner and its non-striking
employees. The findings of the Labor Arbiter and NLRC are supported by substantial evidence that the
union members have committed illegal acts during the strike. Having shown to have committed illegal
acts during the strike, they have deemed lost their employment status.

Even if the purpose of the strike is valid, when the means employed were far from legitimate, such strike
is rendered illegal. Responsibilities for these illegal acts must be on an individual and not on collective
basis. A union officer may be declared to have lost his employment status if he knowingly participates in
an illegal strike, whereas a union member may be similarly faulted if he knowingly participates in the
commission of illegal acts during the strike.

133. JACKBILT INDUSTRIES, INC. v JACKBILT EMPLOYEES WORKERS UNION-NAFLU-

KMU
G.R. No. 171618-19, March 13, 2009

FACTS: Petitioner decided to temporarily stop its business due to adverse effects of the Asian economic
crisis on the construction industry. This was opposed by the union contenting that such was just a ploy in
order for petitioner to avoid its duty to collective bargain. Respondent union then went on strike where its
officers and members committed illegal acts of obstructing the free entry to and exit to petitioner’s
production facility. NLRC issued a TRO upon petitioner’s instance, however, this order was defied by
respondent union prompting NLRC to issue a writ of preliminary injunction. Meanwhile, petitioner
dismissed the concerned officers and employees upon their failure to submit a written explanation the
illegal acts committed during the strike. Respondent union filed a case for illegal dismissal on the ground
that petitioner did not file a petition to declare the strike illegal. Labor arbiter decided in favor of
respondent union. NLRC reversed the labor arbiter. CA affirmed the NLRC. Hence, this petition.

ISSUE: Whether or not the filing of a petition with the labor arbiter to declare the strike illegal is a
condition sine qua non for the valid termination of employees who committed an illegal act in the course
of such strike?

RULING: NO. NLRC had already found that respondent committed illegal acts in the course of the strike
when it issued the writ of preliminary injunction. Pursuant to the principle of conclusiveness of judgment,
the strike was ipso facto illegal, thus, the filing of a petition to declare the strike illegal was unnecessary.

The principle of conclusiveness of judgment, embodied in Section 47(c), Rule 39 of the Rules of Court,
holds that the parties to a case are bound by the findings in a previous judgment with respect to matters
actually raised and adjudged therein.

134. HOTEL ENTERPRISES OF THE PHILIPPINES (HEPI) v. SAMAHAN NG MGA

MANGGAGAWA SA HYATT-NATIONAL UNION OF WORKERS IN THE HOTEL AND
RESTAURANT AND ALLIED INDUSTRIES (SAMASAH-NUWHRAIN)
G.R. No. 165756, June 5, 2009.

FACTS: HEPI’s hotel business suffered a slump due to local and international slowdown. An audited
financial report made by SGV & Co. indicated that the hotel suffered gross operating loss. It decided to
cut down cost by reducing the rank and file employees from 248 down to 150. The vacated positions were
later filled up with contractual personnel and agency employees. Union opposed the downsizing plan
averring that no evidence would support HEPI’s claim of heavy financial losses. Respondent union also
argued that it violates the CBA where it was agreed that it would include the manning and staffing for the
248 regular rank and file employees. Despite the opposition from the union, HEPI declared certain
positions redundant and served notices of termination. Union filed a notice of strike based on ULP. Labor
arbiter declared the strike legal. NLRC reversed the Labor Arbiter. CA reversed the NLRC. Hence, this
petition.

ISSUE: 1. Whether or not HEPIs downsizing scheme was valid?

2. Whether or not implementation of the downsizing scheme preclude HEPI from availing the services of
contractual and agency hire employees?

RULING: 1. YES. While it appears from the union audit that HEPI was still earning, if provisions for
hotel rehabilitation as well as replacement of and additions to the hotels furnishings and equipments are
included, which respondent Union failed to consider, the result is indeed a staggering deficit. Hence, the
downsizing scheme is justified on the ground of serious business losses. Some positions had to be
declared redundant to cut losses. In this context, what may technically be considered as redundancy may
verily be considered as a retrenchment measure. To substantiate its claim, petitioner presented a financial
report covering the years 2000 and 2001 submitted by the SGV & Co., an independent external auditing
firm.

Our labor laws only allow retrenchment or downsizing as a valid exercise of management prerogative if
all other else fail. For a valid retrenchment, the following requisites must be complied with: (1) the
retrenchment is necessary to prevent losses and such losses are proven; (2) written notice to the
employees and to the DOLE at least one month prior to the intended date of retrenchment; and (3)
payment of separation pay equivalent to one-month pay or at least one-half month pay for every year of
service, whichever is higher.

In case of redundancy, the employer must prove that: (1) a written notice was served on both the
employees and the DOLE at least one month prior to the intended date of retrenchment; (2) separation
pay equivalent to at least one month pay or at least one month pay for every year of service, whichever is
higher, has been paid; (3) good faith in abolishing the redundant positions; and (4) adoption of fair and
reasonable criteria in ascertaining which positions are to be declared redundant and accordingly
abolished.

It is the employer who bears the onus of proving compliance with these requirements, retrenchment and
redundancy being in the nature of affirmative defenses. Otherwise, the dismissal is not justified.

2. NO. HEPI implemented the downsizing plan validly and in good faith in the exercise of its
management prerogative.

Jurisprudence is to the effect that an employer’s good faith in implementing a redundancy program is not
necessarily destroyed by availment of the services of an independent contractor to replace the services of
the terminated employees.

135. PNOC Dockyard and Engineering Corp. v. NLRC

G.R. No. 118223, June 5, 2009

FACTS:

Respondent union KMM-PDEC filed with the DOLE a notice of strike against Phil. National Oil
Company (PNOC) on the ground of discrimination constituting unfair labor practice of PNOC by
granting it an amount of P2,500 increase in monthly salaries to Managerial , Professional, and technical
Employees (MPT) but not to Non-managerial, Professional, and technical Employees (NMPT). The case
was certified to the NLRC for compulsory arbitration. The aforequoted Order however was not served to
the respondent union's President who is authorized to receive notices but was merely left with the guard
on duty. On the day the union was supposed to conduct the strike, its officers and members decided to
report for work, however, PNOC refused their entry. Eventually, DOLE issued a return to work order and
all members of the union were admitted back to work. Respondent union then filed a case for illegal lock-
out, while PNOC filed a petition to declare the strike illegal and then dismissed the officers of the
respondent union for their participation in the work stoppage.

ISSUE: 1. Whether or not the strike was illegal?

2. Whether or not the dismissal was illegal?

RULING: 1. NO. The unions had a reason to regard the salary discrimination, believed to discourage
membership in the labor organization, as an unfair labor practice. The union members honesty believed
that they were discriminated against, since the company practice in the past was to grant salary increases
to all employees regardless of whether they were MPTs (managerial, professional, and technical
employees) or NMPTs (non-managerial, professional, and technical employees).

A strike does not automatically carry the stigma of illegality even if no unfair labor practice were
committed by the employer. It suffices if such a belief in good faith is entertained by labor as the inducing
factor for staging a strike." Indeed, the presumption of legality prevails even if the allegation of unfair
labor practice is subsequently found to be untrue, provided that the union and its members believed in
good faith in the truth of such averment.

The argument of PNOC that respondent union did not comply with Section 4, Rule XIII of the Omnibus
Rules Implementing the Labor Code regarding the contents of a notice of strike is untenable. Respondent
union substantially complied with the said provision.

A well-recognized norm in labor law is that technical rules of procedure are not to be strictly interpreted
and applied in a manner that would defeat substantial justice or be unduly detrimental to the work force.
Rules may be relaxed in order to give full meaning to the constitutional mandate of affording full
protection to labor. As provided in Article 4 of the Labor Code, "all doubts in the implementation and
interpretation of this Code, including its implementing rules and regulations, shall be rendered in favor of
labor."

PNOC’s contention that the strike became automatically illegal upon the labor secretary’s certification of
the dispute to the NLRC for compulsory arbitration is without merit. The service of the DOLE
certification was not validly made as it was merely given to a security guard.

No order, decision or resolution — not even one that is "immediately executory" — is binding and
automatically executory unless and until the proper parties are duly notified thereof. The labor Code
specifically enjoins that decisions, orders or awards of the labor secretary, the regional director, the
NLRC or the labor arbiter are "to [be] separately furnished immediately to the counsels of record AND
the parties." This means that in labor cases, both the party and its counsel must be duly served their
separate copies of the order, decision or resolution; unlike in ordinary judicial proceedings where notice
to counsel is deemed notice to the party.

2. YES. Having ruled that the strike staged by respondent unions was legal, the subsequent dismissals of
their officers due to their staging of said strike cannot be countenanced. Furthermore, such investigations
conducted by PNOC were in flagrant disregard of the authority and jurisdiction of the Commission.
The issues relating to the strike and lockout were already submitted before the NLRC through the
corresponding complaints filed by PNOC itself and private respondents. By filing a formal complaint for
illegal strike, it behooved PNOC to desist from undertaking its own investigation on the same matter,
concluding upon the illegality of the union activity and dismissing outright the union officers involved.

136. PHILIPPINE ASSOCIATION OF FREE LABOR UNIONS (PAFLU) v. CLORIBEL.

27 SCRA 465(1969)

FACTS: Petitioner picketed Metropolitan Bank and Trust Company (METBANK) located at the ground
floor of the Wellington Building. Wellington complained that the strikers were blocking the passageway
of the building used as the only passageway by the occupants of the second to sixth floor of the building
and that it gives the disconcerting impression that the strike was staged against it. Private respondent
Wellington sought relief from the CFI of Manila where public respondent Judge Cloribel issued a writ of
preliminary injunction against the picketing union. PAFLU filed with the Supreme Court a petition
alleging that public respondent acted with grave abuse of discretion in issuing the writ.

ISSUE: 1.Whether or not there exists a labor dispute between PAFLU and Wellington?

2. Whether or not the writ of preliminary injunction was issued with grave abuse of discretion?

RULING: 1. NO. The strike and picket were directed against METBANK, an entirely different and
separate entity without connection whatsoever with Wellington other than the incidental fact that they are
the bank’s landlord and co-lessee in the Wellington building. Their relationship is so remote as to make it
fall within the purview of the law which provides that “a labor dispute exists regardless of whether the
disputants stand in the proximate relation of employer and employee.”

2. NO. Wellington is mere "innocent bystander". It is entitled to seek protection of its rights from the
courts and the courts may, accordingly, legally extend the same. Moreover, PAFLU's right to peacefully
picket METBANK is not curtailed by the injunctions issued by respondent judge. The picket is merely
regulated to protect the rights of third parties.

The right to picket as a means of communicating the facts of a labor dispute is a phase of the freedom of
speech guaranteed by the constitution. If peacefully carried out, it cannot be curtailed even in the absence
of employer-employee relationship.
The right is, however, not an absolute one. While peaceful picketing is entitled to protection as an
exercise of free speech, we believe that courts are not without power to confine or localize the sphere of
communication or the demonstration to the parties to the labor dispute, including those with related
interest, and to insulate establishments or persons with no industrial connection or having interest totally
foreign to the context of the dispute. Thus the right may be regulated at the instance of third parties or
"innocent bystanders" if it appears that the inevitable result of its exercise is to create an impression that a
labor dispute with which they have no connection or interest exists between them and the picketing union
or constitute an invasion of their rights.