Republic Savings Bank vs Court of Industrial Relations

Facts:
Herein private respondents are employees of the bank who were discharged for having written and
published a patently libelous letter tending to cause the dishonor, discredit or contempt not only of officers
and employees of the bank, but also of the bank itself. The letter referred to was a letter-charge which the
respondents had written to the bank president, demanding his resignation on the grounds of immorality,
nepotism in the appointment and favoritism as well as discrimination in the promotion of the bank employees.
In several instances, according to respondents, the president instead of resolving several anomalous activities
committed by its employees who also happen to be his relatives, the president promoted these employees
resulting to demoralization of other deserving employees and that the president has a illicit relationship with
one of the bank employees among others. Upon dismissal, respondents filed a complaint in the CIR alleging
that the Banks conduct violated section 4 (a) (5) of the Industrial Peace Act which makes it unfair labor
practice for an employer to dismiss, discharge or otherwise prejudice or discriminate against an employee for
having filed charges or for having given or being to give testimony under this Act .
The Bank moved for the dismissal of the complaint contending that respondents were discharged not
for union activities but for having written and published a libelous letter against the bank president. The Bank
argues that the court should have dismissed the complaint because the discharge of the respondents had
nothing to do with their union activities as the latter in fact admitted at the hearing the writing of the letter-
charge was not a union action but merely their individual act.
Issue:
Whether or not the dismissal of the eight (8) respondent employees by the petitioner Republic Bank
constituted an unfair labor practice within the meaning and intendment of the Industrial Peace Act ( Republic
Act 875 ).
Held:
Yes, the bank is guilty of unfair labor practice.
Assuming that the latter acted in their individual capacities when they wrote the letter-charge they were
nonetheless protected for they were engaged in concerted activity, in the exercise of their right of self-
organization that includes concerted for mutual aid and protection, interference with which constitutes an unfair
labor practice under section 4 (a) (1). For, as has been aptly stated, the joining in properties or demands, even
by a small group of employees, if in furtherance of their interests as such, is a concerted activity protected by
the Industrial Peace Act. It is not necessary that union activity be involved or that collective bargaining be
contemplated.
Indeed, when the respondents complained against nepotism, favoritism and other management
practices, they were acting within an area marked out by the Act as a proper sphere of collective bargaining.
Even the reference to immorality was not irrelevant as it was made to support the respondents other charge
that the bank president had failed to provide wholesome working conditions, let alone a good moral example,
for the employees by practicing discrimination and favoritism in the appointment and promotion of certain
employees on the basis of illicit relations or blood relationship with them.
 Nestle Philippines, Inc. vs. NLRC and Union of Filipro Employees
Facts:
Four (4) collective bargaining agreements separately covering the petitioner's employees in its
Alabang/Cabuyao factories; Makati Administration Office. (Both Alabang/Cabuyao factories and Makati office
were represented by the respondent, Union of Filipro Employees [UFE]);Cagayan de Oro Factory represented
by WATU; and Cebu/Davao Sales Offices represented by the Trade Union of the Philippines and Allied
Services (TUPAS), all expired on June 30, 1987. UFE was certified as the sole and exclusive bargaining agent
for all regular rank-and-file employees at the petitioner's Cagayan de Oro factory, as well as its Cebu/Davao
Sales Office.
In August 1987, while the parties, were negotiating, the employees at Cabuyao resorted to a "slowdown" and
walk-outs prompting the petitioner to shut down the factory. Marathon collective bargaining negotiations
between the parties ensued. On September 1987, the UFE declared a bargaining deadlock. On September 8,
1987, the Secretary of Labor assumed jurisdiction and issued a return to work order. In spite of that order, the
union struck, without notice, at the Alabang/Cabuyao factory, the Makati office and Cagayan de Oro factory on
September 11, 1987 up to December 8, 1987. The company retaliated by dismissing the union officers and
members of the negotiating panel who participated in the illegal strike. The NLRC affirmed the dismissals on
November 2, 1988.
On January 26, 1988, UFE filed a notice of strike on the same ground of CBA deadlock and unfair labor
practices. However, on March 30, 1988, the company was able to conclude a CBA with the union at the
Cebu/Davao Sales Office, and on August 5, 1988, with the Cagayan de Oro factory workers. The union
assailed the validity of those agreements and filed a case of unfair labor practice against the company on
November 16, 1988.
After conciliation efforts of the NCMB yielded negative results, the dispute was certified to the NLRC. The
NLRC issued a resolution on June 5, 1989, whose pertinent disposition regarding the union's demand for
liberalization of the company's retirement plan for its workers. The NLRC issued a resolution denying the
motions for reconsideration. With regard to the Retirement Plan, the NLRC held that anent management's
objection to the modification of its Retirement Plan, the plan is specifically mentioned in the previous
bargaining agreements thereby integrating or incorporating the provisions thereof to the agreement. By reason
of its incorporation, the plan assumes a consensual character which cannot be terminated or modified at will by
either party. Consequently, it becomes part and parcel of CBA negotiations. Petitioner alleged that since its
retirement plan is non-contributory, Nestle has the sole and exclusive prerogative to define the terms of the
plan because the workers have no vested and demandable rights, the grant thereof being not a contractual
obligation but merely gratuitous. At most the company can only be directed to maintain the same but not to
change its terms. It should be left tothe discretion of the company on how to improve or modify the same.
Issue: Whether or not the workers have vested and demandable rights over the retirement plan
Ruling:
The Court ruled that employees have a vested and demandable right over the retirement plan. The inclusion of
the retirement plan in the collective bargaining agreement as part of the package of economic benefits
extended by the company to its employees to provide them a measure of financial security after they shall
have ceased to be employed in the company, reward their loyalty, boost their morale and efficiency and
promote industrial peace, gives "a consensual character" to the plan so that it may not be terminated or
modified at will by either party.
The NLRC correctly observed that the inclusion of the retirement plan in the collective bargaining agreement
as part of the package of economic benefits extended by the company to its employees to provide them a
measure of financial security after they shall have ceased to be employed in the company, reward their loyalty,
boost their morale and efficiency and promote industrial peace, gives "a consensual character" to the plan so
that it may not be terminated or modified at will by either party.
The fact that the retirement plan is non-contributory, i.e., that the employees contribute nothing to the operation
of the plan, does not make it a non-issue in the CBA negotiations. As a matter of fact, almost all of the benefits
that the petitioner has granted to its employees under the CBA salary increases, rice allowances, midyear
bonuses, 13th and 14th month pay, seniority pay, medical and hospitalization plans, health and dental
services, vacation, sick & other leaves with pay are non-contributory benefits. Since the retirement plan has
been an integral part of the CBA since 1972, the Unions demand to increase the benefits due the employees
under said plan, is a valid CBA issue. The deadlock between the company and the union on this issue was
resolvable by the Secretary of Labor, or the NLRC, after the Secretary had assumed jurisdiction over the labor
dispute (Art. 263, subparagraph [i] of the Labor Code).
 LUZON DEVELOPMENT BANK vs. ASSOC. OF LUZON DEVELOPMENT BANK EMPLOYEES

FACTS
A voluntary arbitration case arose between LDB and ALDBE with regard to the issue on whether or not
LDB violated the Collective Bargaining provision and the Memorandum of Agreement dated April 1994 on the
promotion of employees. Only ALDBE submitted a position paper to the voluntary arbitrator. Thereafter, the
voluntary arbitrator rendered a decision stating that LDB failed to adhere with their Collective Bargaining
provision and MOA on promotion. Thus, this petition for certiorari and prohibition seeking to set aside the
decision of the Voluntary Arbitrator and to prohibit her from enforcing the same was filed before this Court.

ISSUE
Whether or not the decision of the voluntary arbitrator may be directly appealed to the SC.

HELD
No, it should be appealed first before the CA.

Although R.A. 6715 is silent to an appeal from the decision of a voluntary arbitrator, Sec. 9 of B.P. Blg.
129, as amended by Republic Act No. 7902 provides that Court of Appeals shall exercise exclusive appellate
jurisdiction over all final judgements, decisions, orders, resolutions, or awards of quasi-judicial agencies and
instrumentalities except those falling within the appellate jurisdiction of the Supreme Court in accordance with
the Constitution, the Labor Code of the Philippines under Presidential Decree No. 442, as amended.

The Court held that a voluntary arbitrator or the panel of voluntary arbitrators may not be strictly be
considered as a quasi-judicial agency but still he and the panel are comprehended within the concept of
quasi-judicial instrumentality. The voluntary arbitrator no less performs a state function pursuant to a
governmental power delegated to him under the provisions therefor in the Labor Code and he falls, therefore,
within the contemplation of the term "instrumentality" in the aforequoted Sec. 9 of B.P. 129. The fact that his
functions and powers are provided for in the Labor Code does not place him within the exceptions to said Sec.
9 since he is a quasi-judicial instrumentality as contemplated therein.

In a petition for certiorari from the award or decision of a voluntary arbitrator, the Court of Appeals must
be deemed to have concurrent jurisdiction with the Supreme Court. As a matter of policy, this Court shall
henceforth remand to the Court of Appeals petitions of this nature for proper disposition. Hence, ,the Court
resolved to REFER this case to the Court of Appeals.
 KIOK LOY vs. NLRC & KILUSAN

Facts:
Petition for certiorari to annul the decision of the NLRC which found petitioner Sweden Ice Cream guilty of
unfair labor practice for unjustified refusal to bargain, in violation of par. (g) of Article 249 of the New Labor
Code, and declared the draft proposal of the Union for a collective bargaining agreement as the governing
collective bargaining agreement between the employees and the management.

The Pambansang Kilusang Paggawa, a legitimate late labor federation, won and was subsequently certified in
a resolution by the Bureau of Labor Relations as the sole and exclusive bargaining agent of the rank-and-file
employees of Sweden Ice Cream Plant.

The Union furnished the Company with two copies of its proposed collective bargaining agreement. At the
same time, it requested the Company for its counter proposals. Both requests were ignored and remained
unacted upon by the Company.

Thereafter, the Union filed a "Notice of Strike", with the Bureau of Labor Relations (BLR) on ground of
unresolved economic issues in collective bargaining.

Conciliation proceedings then followed during the thirty-day statutory cooling-off period. But all attempts
towards an amicable settlement failed.

The case was brought to the NLRC for compulsory arbitration pursuant to Presidential Decree No. 823, as
amended. But the Company requested for a lot of postponements. NLRC ruled that respondent Sweden Ice
Cream is guilty of unjustified refusal to bargain, in violation of Section (g) Article 248 (now Article 249), of P.D.
442, as amended.

Issue:
Whether the Company is guilty of unfair labor practice for refusal to bargain

Held:

Yes. Petitioner Company is GUILTY of unfair labor practice. It has been indubitably established that (1)
respondent Union was a duly certified bargaining agent; (2) it made a definite request to bargain, accompanied
with a copy of the proposed Collective Bargaining Agreement, to the Company not only once but twice which
were left unanswered and unacted upon; and (3) the Company made no counter proposal whatsoever all of
which conclusively indicate lack of a sincere desire to negotiate. A Company's refusal to make counter
proposal if considered in relation to the entire bargaining process, may indicate bad faith and this is specially
true where the Union's request for a counter proposal is left unanswered. Even during the period of compulsory
arbitration before the NLRC, petitioner Company's approach and attitude-stalling the negotiation by a series of
postponements, non-appearance at the hearing conducted, and undue delay in submitting its financial
statements, lead to no other conclusion except that it is unwilling to negotiate and reach an agreement with the
Union.

From the over-all conduct of petitioner company in relation to the task of negotiation, there can be no doubt
that the Union has a valid cause to complain against its (Company's) attitude, the totality of which is indicative
of the latter's disregard of, and failure to live up to, what is enjoined by the Labor Code to bargain in good
faith.

Collective bargaining which is defined as negotiations towards a collective agreement, is one of the democratic
frameworks under the New Labor Code, designed to stabilize the relation between labor and management and
to create a climate of sound and stable industrial peace. It is a mutual responsibility of the employer and the
Union and is characterized as a legal obligation. So much so that Article 249, par. (g) of the Labor Code makes
it an unfair labor practice for an employer to refuse "to meet and convene promptly and expeditiously in good
faith for the purpose of negotiating an agreement with respect to wages, hours of work, and all other terms and
conditions of employment including proposals for adjusting any grievance or question arising under such an
agreement and executing a contract incorporating such agreement, if requested by either party.

While it is a mutual obligation of the parties to bargain, the employer, however, is not under any legal duty to
initiate contract negotiation. The mechanics of collective bargaining is set in motion only when the following
jurisdictional preconditions are present, namely, (1) possession of the status of majority representation of the
employees' representative in accordance with any of the means of selection or designation provided for by the
Labor Code; (2) proof of majority representation; and (3) a demand to bargain under Article 251, par. (a) of the
New Labor Code . ... all of which preconditions are undisputedly present in the instant case.
 THE HONGKONG AND SHANGHAI BANKING CORPORATION EMPLOYEES UNION vs. NLRC

FACTS:
The case at bar arose from the issuance of a non-executive job evaluation program (JEP) lowering the starting
salaries of future employees, resulting from the changes made in the job grades and structures, which was
unilaterally implemented by the Bank retroactive to January 1, 1993.

The Union, through its President, objects to the Bank's unilateral decision because it allegedly was in violation
of the existing collective bargaining agreement (CBA) between the parties and thus constituted unfair labor
practice. The Union demanded the suspension of the implementation of the JEP and proposed that the same
be instead taken up or included in their upcoming CBA negotiations.

The Union undertake concerted activities to protest the implementation of the JEP, such as whistle blowing
during office hours and writing to clients of the Bank allegedly to inform them of the real situation then obtaining
and of an imminent disastrous showdown between the Bank and the Union. The Bank was forced to declare a
"recess" to last for as long as the Union kept up with its concerted activities. The Union refused to concede to
the demand of the Bank unless the latter agreed to suspend the implementation of the JEP.

Instead of acquiescing thereto, the Bank filed with the Arbitration Branch of the NLRC a complaint for unfair
labor practice against the Union allegedly for engaging in the contrived activities against the ongoing CBA
negotiations between the Bank and the Union in an attempt to unduly coerce and pressure the Bank into
agreeing to the Union's demand for the suspension of the implementation of the JEP. It averred that such
concerted activities, despite the ongoing CBA negotiations, constitute unfair labor practice (ULP) and a
violation of the Union's duty to bargain collectively under Articles 249 (c) and 252 of the Labor Code.

The Union filed a Motion to Dismiss claiming that the unilateral implementation of the JEP was in violation of
Article I, Section 3 of the CBA which prohibits a diminution of existing rights, privileges and benefits already
granted and enjoyed by the employees. The Union insists that the right to engage in these concerted activities
is protected under Article 246 of the Labor Code regarding non-abridgment of the right to self-organization and,
hence, is not actionable in law.

The Union asserts that respondent NLRC committed grave abuse of discretion in failing to decide that it is not
guilty of unfair labor practice considering that the concerted activities were actually directed against the
implementation of the JEP and not at before the start of negotiations. Hence, it cannot be deemed to have
engaged in bad-faith bargaining.

ISSUE:
Whether or not the concerted activities were committed in violation of the Union's duty to bargain collectively
and would therefore constitute unfair labor practice.

HELD:
A determination of the validity of the Bank's unilateral implementation of the JEP or the Union's act of engaging
in concerted activities involves an appraisal of their motives. In cases of this nature, motivations are seldom
expressly avowed, and avowals are not always candid. There must thus be a measure of reliance on the
administrative agency. It was incumbent upon the labor arbiter to weigh such expressed motives in determining
the effect of an otherwise equivocal act. The Labor Code does not undertake the impossible task of specifying
in precise and unmistake language each incident which constitutes an unfair labor practice. Rather, it leaves to
the court the work of applying the law's general prohibitory language in light of infinite combinations of events
which may be charged as violative of its terms.

There is no per se test of good faith in bargaining. Good faith or bad faith is an inference to be drawn from the
facts. To some degree, the question of good faith may be a question of credibility. The effect of an employer's
or a union's actions individually is not the test of good-faith bargaining, but the impact of all such occasions or
actions, considered as a whole, and the inferences fairly drawn therefrom collectively may offer a basis for the
finding of the NLRC.
In the case at bar, private respondent union has miserably failed to convince this Court that the petitioner acted
in bad faith in implementing the JE Program. There is no showing that the JE Program was intended to
circumvent the law and deprive the members of respondent union of the benefits they used to receive.

. . . It is the prerogative of management to regulate, according to its discretion and judgment, all aspects of
employment. This flows from the established rule that labor laws does not authorize the substitution of the
judgment of the employer in the conduct of its business. Such management prerogative may be availed of
without fear of any liability so long as it is exercised in good faith for the advancement of the employers'
interest and not for the purpose of defeating or circumventing the rights of employees under special laws or
valid agreement and are not exercised in a malicious, harsh, oppressive, vindictive or wanton manner or out of
malice or spite.

The Court may, in addition to the usual cease and desist orders, issue an affirmative order to the employer to
"bargain" with the bargaining agent, as the exclusive representative of its employees, with respect to the rate of
pay, hours of work, and other conditions of employment.
 Elizalde Rope Factory, Inc. vs. CIR and PAFLU

Facts:

Karasig went to see the superintendent and requested the latter that if possible he should not be transferred
from one machine to another; that instead of receiving a favorable answer, the superintendent insulted him;
that he told the superintendent he would rather retire, so the superintendent called his messenger to fetch
some application blanks to be filled. Karasig wrote on the form for his retirement was the unfair labor practice
and inhuman treatment of his foreman. Management turned down the application for retirement of Karasig for
the reason that the applicant is not incapacitated to justify his retirement under the collective bargaining
contract.

Karasig reported to his union president on the incident, and the latter sent letters to the management asking for
adjustment of the grievance. A week after, the company sent for the president of the union to inform him that in
so far as they were concerned, Karasig had resigned and left his work without notifying them as required by
law and that Karasig's application for retirement had been turned down.

PAFLU, to which the Union was affiliated, sought to have Karasig's case considered as a grievance, but the
company insisted that it was excluded from the collective bargaining contract. PAFLU, Union and Karasig filed
a complaint to the CIR for unfair labor practice. CIR held that Karasig was not separated from the service
because of union activities and holding that the company committed an unfair labor practice for refusing to
bargain with the former's union;

Issue:

W/n the duty to bargain collectively of the company and the union compels any party to agree to a proposal.

Held:

NO. The duty to bargain collectively means the performance of the mutual obligation to meet and confer
promptly and expeditiously and in good faith, for the purpose of negotiating an agreement with respect to
wages, hours, and/or terms and conditions of employment, and of executing a written contract incorporating
such agreement if requested by either party, or for the purpose of adjusting any grievances or question arising
under such agreement, but such duty does not compel any party to agree to a proposal or to make
concession."

The last clause of the above-quoted provisions cannot be invoked by the complaining laborer represented by
the union, because the very terms of the CBA quoted above entered into by and between the petitioner and the
respondent union preclude its availability. The grievance procedure and handling in the CBA which is binding
upon both the contracting parties not having been availed of, the collective bargaining "for the purpose of
adjusting any grievances or question arising under such agreement," is unavailable.
 COLEGIO DE SAN JUAN DE LETRAN vs. ASSOCIATION OF EMPLOYEES AND FACULTY OF LETRAN
and ELEONOR AMBAS

F A C T S:

The then President of respondent union, initiated the renegotiation of its Collective Bargaining
Agreement with petitioner Colegio de San Juan de Letran for the last two (2) years of the CBA's five (5) year
lifetime from 1989-1994. On the same year, the union elected a new set of officers wherein private respondent
Ambas emerged as the newly elected President..

The parties agreed to disregard the unsigned CBA and to start negotiation on a new five-year CBA
starting 1994-1999. The union filed a notice of strike.

Both parties again discussed the ground rules for the CBA renegotiation. However, petitioner stopped
the negotiations after it purportedly received information that a new group of employees had filed a petition for
certification election.

The union finally struck. Public respondent the Secretary of Labor and Employment assumed
jurisdiction and ordered all striking employees including the union president to return to work and for petitioner
to accept them back under the same terms and conditions before the actual strike. Petitioner readmitted the
striking members except Ambas.

Public respondent issued an order declaring petitioner guilty of unfair labor practice. Having been
denied its motion for reconsideration, petitioner sought a review of the order of the Secretary of Labor and
Employment before the Court of Appeals. The appellate court dismissed the petition and affirmed the findings
of the Secretary of Labor and Employment

Hence, petitioner comes to this Court for redress.

I S S U E:

W/N petitioner is guilty of unfair labor practice by refusing to bargain with the union when it unilaterally
suspended the ongoing negotiations for a new Collective Bargaining Agreement (CBA) upon mere information
that a petition for certification has been filed by another legitimate labor organization

R U L I N G:

YES, there is no doubt that petitioner is guilty of unfair labor practice by its stern refusal to bargain in
good faith with respondent union.

Article 252 of the Labor Code defines the meaning of the phrase "duty to bargain collectively," as
follows:

Art. 252. Meaning of duty to bargain collectively. - The duty to bargain collectively means the
performance of a mutual obligation to meet and convene promptly and expeditiously in good faith for
the purpose of negotiating an agreement with respect to wages, hours of work and all other terms and
conditions of employment including proposals for adjusting any grievances or questions arising under
such agreement and executing a contract incorporating such agreements if requested by either party
but such duty does not compel any party to agree to a proposal or to make any concession.

Noteworthy is the requirement on both parties of the performance of the mutual obligation to meet and
convene promptly and expeditiously in good faith for the purpose of negotiating an agreement. Undoubtedly,
respondent Association of Employees and Faculty of Letran (AEFL) (hereinafter, "union") lived up to this
requisite when it presented its proposals for the CBA to petitioner on February 7, 1996. On the other hand,
petitioner devised ways and means in order to prevent the negotiation.
 Petitioner's utter lack of interest in bargaining with the union is obvious in its failure to make a timely
reply to the proposals presented by the latter. More than a month after the proposals were submitted by the
union, petitioner still had not made any counter-proposals. This inaction on the part of petitioner prompted the
union to file its second notice of strike on March 13, 1996. Petitioner could only offer a feeble explanation that
the Board of Trustees had not yet convened to discuss the matter as its excuse for failing to file its reply. This
is a clear violation of Article 250 of the Labor Code governing the procedure in collective bargaining.
 LMG CHEMICALS CORPORATION, LMG CHEMICALS CORPORATION vs. THE SECRETARY OF THE
DEPARTMENT OF LABOR AND EMPLOYMENT, THE HON. LEONARDO A. QUISUMBING, and
CHEMICAL WORKER'S UNION

F A C T S:

LMG Chemicals Corporation, petitioner, is a domestic corporation engaged in the manufacture and sale
of various kinds of chemical substances. There are two unions within petitioner's Inorganic Division. One union
represents the daily paid employees and the other union represents the monthly paid employees. Chemical
Workers Union, respondent, is a duly registered labor organization acting as the collective bargaining agent of
all the daily paid employees of petitioner's Inorganic Division.

The petitioner and the respondent started negotiation for a new Collective Bargaining Agreement (CBA)
as their old CBA was about to expire.

Respondent union staged a strike. In an attempt to end the strike early, petitioner, made an improved
offer of P135 per day, spread over the period of three years.

Petitioner made a turn-around, stating that it could no longer afford to grant its previous offer due to
serious financial losses during the early months of 1996.

The Secretary of Labor and Employment issued an order to further increase the Companys offer to
P140 per day.

I S S U E:

W/N the respondent court erred in granting a P140 wage increase to the Union

R U L I N G:

No. Respondent Secretary considered all the evidence and arguments adduced by both parties. Verily,
petitioner's assertion that respondent Secretary failed to consider the evidence on record lacks merit. It was
only the Inorganic Division of the petitioner corporation that was sustaining losses. Such incident does not
justify the withholding of any salary increase as petitioner's income from all sources are collated for the
determination of its true financial condition. As correctly stated by the Secretary, "the loss in one is usually
offset by the gains in the others."

Moreover, petitioner company granted its supervisory employees, during the pendency of the
negotiations between the parties, a wage increase of P4,500 per month or P166 per day, more or less.
Petitioner justified this by saying that the said increase was pursuant to its earlier agreement with the
supervisions. Hence, the company had no choice but to abide by such agreement even if it was already
sustaining losses as a result of the strike of the rank-and-file employees.

Petitioner's actuation is actually a discrimination against respondent union members. If it could grant a
wage increase to its supervisors, there is no valid reason why it should deny the same to respondent union
members. Significantly, while petitioner asserts that it sustained losses in the first part of 1996, yet during the
May 9, 1996 conciliation meeting, it made the offer of P135 daily wage to the said union members.

This Court, therefore, holds that respondent Secretary did not gravely abuse his discretion in ordering
the wage increase. Grave abuse of discretion implies whimsical and capricious exercise of power which, in the
instant case, is not obtaining.
 CASIANO NAVARRO vs DAMASCO & BUSCO SUGAR MILLING CO
Facts:
Petitioner Navarro, a typist of BUSCO SUGAR MILLING CO, went to visit Mercie Baylas, whom he was
courting, in the companys ladies dormitory. Upon seeing him, Baylas ran towards her room but lost her
balance; petitioner overcame her, embraced her, put himself on top of her and started kissing her until other
employees responded to Baylas' flee for help. The company put Navarro under preventive suspension
because of the incident and he was meted out the penalty of dismissal upon the recommendation of the
investigator for violating the company's Code of Conduct against acts of immorality and gross discourtesy to a
co-employee inside company premises.
The President of the Mindanao Sugar Workers Union, for and in behalf of petitioner, and the Personnel Officer
of the company agreed to submit the case of petitioner to voluntary arbitration. Counsel for petitioner, during
the initial conference with the Voluntary Arbitrator, questioned whether the grievance procedure in the CBA
before bringing the case before the Voluntary Arbitrator had been followed. The parties, however, also agreed
to submit the case for decision based on their position papers. The Voluntary Arbitrator rendered a decision
dismissing petitioner from employment and holding that the company did not violate the provisions of the
grievance procedure under the CBA. Petitioner contends that the grievance procedure provided for in the CBA
was not followed; hence, the Voluntary Arbitrator exceeded his authority when he took cognizance of the labor
case. Petitioner also claims that he was denied due process of law because no hearing was held and he was
not given an opportunity to cross-examine the witnesses.

Issues:
1. WON the case of petitioner should have been brought to the companys grievance machinery prior to the
Voluntary Arbitrator.
2. WON petitioner was denied due process.
Held:
1. It is the policy of the State to promote voluntary arbitration as a mode of settling labor disputes. The instant
case is not a grievance that must be submitted to the grievance machinery. What are subject of the grievance
procedure for adjustment and resolution are grievances arising from the interpretation or implementation of the
CBA. The acts of petitioner involved a violation of the Code of Employee Discipline, particularly the provision
penalizing the immoral conduct of employees. Consequently, there was no justification for petitioner to invoke
the grievance machinery provisions of the Collective Bargaining Agreement.
Also, the case of petitioner was submitted to voluntary arbitration by agreement of the president of the labor
union to which petitioner belongs, and his employer, through its personnel officer. Petitioner himself voluntarily
submitted to the jurisdiction of the Voluntary Arbitrator when he, through his counsel, filed his position paper
with the Voluntary Arbitrator and even submitted additional documentary evidence.
2. Petitioner was not denied due process. Due process in administrative proceedings is an opportunity to
explain ones side or an opportunity to seek a reconsideration of the action or ruling complained of. A formal or
trial-type hearing is not at all times and in all instances essential. The requirements are satisfied where the
parties are afforded fair and reasonable opportunity to explain their side of the controversy at hand.
Concerning the allegation that petitioner was not allowed to cross-examine the witnesses, the record shows
that the parties had agreed not to cross-examine their witnesses anymore.
WHEREFORE, the Decision of the respondent Voluntary Arbitrator is AFFIRMED
 NEW PACIFIC TIMBER SUPPLY COMPANY VS NLRC
FACTS:
The National Federation of Labor was certified as the sole and exclusive bargaining representative of
all the regular rank-and-file employees of New Pacific Timber & Supply Co., Inc. (hereinafter referred to as
petitioner Company). As such, NFL started to negotiate for better terms and conditions of employment for the
employees in the bargaining unit which it represented. However, the same was allegedly met with stiff
resistance by petitioner Company, so that the former was prompted to file a complaint for unfair labor practice
(ULP) against the latter on the ground of refusal to bargain collectively. Then Executive Labor Arbiter Hakim S.
Abdulwahid issued an order declaring herein petitioner Company guilty of ULP. Thereafter, the records of the
case were remanded to the arbitration branch of origin for the execution of Labor Arbiter Abdulwahid's Order,
dated March 31, 1987, granting monetary benefits consisting of wage increases, housing allowances, bonuses,
etc. to the regular rank-and-file employees. Following a series of conferences to thresh out the details of
computation, Labor Arbiter Reynaldo S. Villena issued an Order, dated October 18, 1993, directing petitioner
Company to pay the 142 employees entitled to the aforesaid benefits the respective amounts due them under
the CBA. Petitioner Company complied; and, the corresponding quitclaims were executed.

A "Petition for Relief" was filed in behalf of 186 of the private respondents "Mariano J. Akilit and 350 others" on
May 12, 1994. In their petition, they claimed that they were wrongfully excluded from enjoying the benefits
under the CBA since the agreement with NFL and petitioner Company limited the CBA's implementation to
only the 142 rank-and-file employees enumerated. NLRC declared that 186 excluded employees are entitled to
the benefits under the CBA. Petitioner Company insists that the rank-and-file employees hired after the term of
the CBA inspite of their subsequent membership in the bargaining unit, are not parties to the agreement, and
certainly may not claim the benefits thereunder.

Issue: Whether or not the 186 excluded employees in the benefits are entitled to.
Ruling:

Yes. In a long line of cases, this Court has held that when a collective bargaining contract is entered into by the
union representing the employees and the employer, even the non-member employees are entitled to the
benefits of the contract. To accord its benefits only to members of the union without any valid reason would
constitute undue discrimination against nonmember. It is even conceded, that a laborer can claim benefits from
a CBA entered into between the company and the union of which he is a member at the time of the conclusion
of the agreement, after he has resigned from said union.

In the same vein, the benefits under the CBA in the instant case should be extended to those employees who
only became such after the year 1984. To exclude them would constitute undue discrimination and deprive
them of monetary benefits they would otherwise be entitled to under a new collective bargaining contract to
which they would have been parties. Since in this particular case, no new agreement had been entered into
after the CBA's stipulated term, it is only fair and just that the employees hired thereafter be included in the
existing CBA. This is in consonance with our ruling that the terms and conditions of a collective bargaining
agreement continue to have force and effect beyond the stipulated term when no new agreement is executed
by and between the parties to avoid or prevent the situation where no collective bargaining agreement at
all would govern between the employer company and its employees.
 Samahan ng Manggagawa sa Top Form Manufacturing vs. NLRC
FACTS:
Petitioner Samahang Manggagawa sa Top Form Manufacturing United Workers of the Philippines (SMTFM)
was the certified collective bargaining representative of all regular rank and file employees of private
respondent Top Form Manufacturing Philippines, Inc. At the collective bargaining negotiation held at the Milky
Way Restaurant in Makati, Metro Manila on February 27, 1990, the parties agreed to discuss unresolved
economic issues. According to the minutes of the meeting, Article VII of the collective bargaining agreement
was discussed.
RTWPB-NCR issued Wage Order No. 01 granting an increase of P17.00 per day in the salary of workers. This
was followed by Wage Order No. 02 dated December 20, 1990 providing for a P12.00 daily increase in salary.
As expected, the union requested the implementation of said wage orders. However, they demanded that the
increase be on an across-the-board basis. Private respondent refused to accede to that demand. Instead, it
implemented a scheme of increases purportedly to avoid wage distortion. Thus, private respondent granted the
P17.00 increase under Wage Order No. 01 to workers/employees receiving salary of P125.00 per day and
below. The P12.00 increase mandated by Wage Order No. 02 was granted to those receiving the salary of
P140.00 per day and below. For employees receiving salary higher than P125.00 or P140.00 per day, private
respondent granted an escalated increase ranging from P6.99 to P14.30 and from P6.00 to P10.00,
respectively.
The union, through its legal counsel, wrote private respondent a letter demanding that it should fulfill its pledge
of sincerity to the union by granting an across-the-board wage increases (sic) to all employees under the wage
orders. The union reiterated that it had agreed to retain the old provision of CBA on the strength of private
respondents promise and assurance of an across-the-board salary increase should the government mandate
salary increases. Several conferences between the parties notwithstanding, private respondent adamantly
maintained its position on the salary increases it had granted that were purportedly designed to avoid wage
distortion.
Consequently, the union filed a complaint with the NCR NLRC alleging that private respondents act of
reneging on its undertaking/promise clearly constitutes act of unfair labor practice through bargaining in bad
faith. It charged private respondent with acts of unfair labor practices or violation of Article 247 of the Labor
Code, as amended, specifically bargaining in bad faith, and prayed that it be awarded actual, moral and
exemplary damages. In its position paper, the union added that it was charging private respondent with
violation of Article 100 of the Labor Code.
Private respondent, on the other hand, contended that in implementing Wage Orders Nos. 01 and 02, it had
avoided the existence of a wage distortion that would arise from such implementation. It emphasized that
only after a reasonable length of time from the implementation of the wage orders that the union surprisingly
raised the question that the company should have implemented said wage orders on an across-the-board
basis. It asserted that there was no agreement to the effect that future wage increases mandated by the
government should be implemented on an across-the-board basis. Otherwise, that agreement would have
been incorporated and expressly stipulated in the CBA.
Labor Arbiter Jose G. de Vera rendered a decision dismissing the complaint for lack of merit.
Union appealed to the NLRC that, in turn, promulgated the assailed Resolution of April 29, 1993 9 dismissing
the appeal for lack of merit. Still dissatisfied, petitioner sought reconsideration which, however, was denied by
the NLRC in the Resolution dated January 17, 1994. Hence, the instant petition for certiorari
ISSUE: Whether or not an employer committed an unfair labor practice by bargaining in bad faith and
discriminating against its employees.

Held:
To start with, if there was indeed a promise or undertaking on the part of private respondent to obligate itself to
grant an automatic across-the-board wage increase, petitioner union should have requested or demanded that
such promise or undertaking be incorporated in the CBA. After all, petitioner union has the means under the
law to compel private respondent to incorporate this specific economic proposal in the CBA.
It could have invoked Article 252 of the Labor Code defining duty to bargain, Thus, the duty includes
executing a contract incorporating such agreements if requested by either party. Petitioner unions assertion
that it had insisted on the incorporation of the same proposal may have a factual basis considering the
allegations in the aforementioned joint affidavit of its members.
However, Article 252 also states that the duty to bargain does not compel any party to agree to a proposal or
make any concession.
Thus, petitioner union may not validly claim that the proposal embodied in the Minutes of the negotiation forms
part of the CBA that it finally entered into with private respondent.
 DAVAO INTEGRATED PORT STEVEDORING SERVICES, petitioner, vs. RUBEN V. ABARQUEZ, in his
capacity as an accredited Voluntary Arbitrator and THE ASSOCIATION OF TRADE UNIONS (ATU-
TUCP), respondents
FACTS:

Petitioner Davao Integrated Port Stevedoring Services (petitioner-company) and private respondent
ATU-TUCP (Union), the exclusive collective bargaining agent of the rank and file workers of petitioner-
company, entered into a collective bargaining agreement (CBA), under Sections 1 and 3, Article VIII
thereof, provide for sick leave with pay benefits each year to its employees who have rendered at least
one (1) year of service with the company.
Upon its renewal on April 15, 1989, the provisions for sick leave with pay benefits were reproduced
under Sections 1 and 3, Article VIII of the new CBA, but the coverage of the said benefits was
expanded to include the "present Regular Extra Labor Pool as of the signing of this Agreement.
During the effectivity of the CBA of October 16, all the field workers of petitioner who are members of
the regular labor pool and the present regular extra labor pool who had rendered at least 750 hours up
to 1,500 hours were extended sick leave with pay benefits. Any unenjoyed portion thereof at the end of
the current year was converted to cash and paid at the end of the said one-year period. The number of
days of their sick leave per year depends on the number of hours of service per calendar year in
accordance with the schedule provided.
The commutation of the unenjoyed portion of the sick leave with pay benefits of the intermittent workers
or its conversion to cash was, however, discontinued or withdrawn when petitioner-company under a
new assistant manager, Mr. Benjamin Marzo stopped the payment of its cash equivalent on the ground
that they are not entitled to the said benefits under Sections 1 and 3 of the 1989 CBA.
The Union objected to the said discontinuance of commutation or conversion to cash of the unenjoyed
sick leave with pay benefits of petitioner's intermittent workers contending that it is a deviation from the
true intent of the parties that negotiated the CBA; that it would violate the principle in labor laws that
benefits already extended shall not be taken away and that it would result in discrimination between the
non-intermittent and the intermittent workers of the petitioner-company.
Upon failure of the parties to amicably settle the issue on the interpretation of Sections 1 and 3, Article
VIII of the 1989 CBA, the Union brought the matter for voluntary arbitration before the National
Conciliation and Mediation Board. After the parties had filed their respective position papers, Public
respondent Ruben Abarquez, Jr. issued an Award in favor of the Union ruling that the regular
intermittent workers are entitled to commutation of their unenjoyed sick leave with pay benefits under
Sections 1 and 3 of the 1989 CBA.
Petitioner-company argued that it is clear from the language and intent of the last sentence of Section
1, Article VIII of the 1989 CBA that only the regular workers whose work are not intermittent are entitled
to the benefit of conversion to cash of the unenjoyed portion of sick leave. Further argued that while the
intermittent workers were paid the cash equivalent of their unenjoyed sick leave with pay benefits
during the previous management of Mr. Beltran who misinterpreted Sections 1 and 3 of Article VIII of
the 1985 CBA, it was well within petitioner-company's rights to rectify the error it had committed and
stop the payment of the said sick leave with pay benefits. An error in payment, according to petitioner-
company, can never ripen into a practice.
ISSUE: Whether or not the Discontinuance of commutation or conversion to cash of the unenjoyed sick leave
with pay benefits of workers is Valid.
HELD:
No, A collective bargaining agreement (CBA), as used in Article 252 of the Labor Code, refers to a
contract executed upon request of either the employer or the exclusive bargaining representative incorporating
the agreement reached after negotiations with respect to wages, hours of work and all other terms and
conditions of employment, including proposals for adjusting any grievances or questions arising under such
agreement. While the terms and conditions of a CBA constitute the law between the parties, it is not, however,
an ordinary contract to which is applied the principles of law governing ordinary contracts. A CBA, as a labor
contract within the contemplation of Article 1700 of the Civil Code of the Philippines which governs the
relations between labor and capital, is not merely contractual in nature but impressed with public interest, thus,
it must yield to the common good. As such, it must be construed liberally rather than narrowly and technically,
and the courts must place a practical and realistic construction upon it, giving due consideration to the context
in which it is negotiated and purpose which it is intended to serve.
Thus erroneous for petitioner to isolate Section 1, Article VIII of the 1989 CBA from the other related
section on sick leave with pay benefits in its attempt to justify the discontinuance or withdrawal of the privilege
of commutation or conversion to cash of the unenjoyed portion of the sick leave benefit to regular intermittent
workers. It must be noted that the 1989 CBA has two (2) sections on sick leave with pay benefits which apply
to two (2) distinct classes of workers in petitioner's company, namely: (1) the regular non-intermittent workers
or those workers who render a daily eight-hour service to the company and are governed by Section 1, Article
VIII of the 1989 CBA; and (2) intermittent field workers who are members of the regular labor pool and the
present regular extra labor pool as of the signing of the agreement on April 15, 1989 or those workers who
have irregular working days and are governed by Section 3, Article VIII of the 1989 CBA. It is not disputed that
both classes of workers are entitled to sick leave with pay benefits provided they comply with the conditions.
 Kimberly Clark Philippines vs Voluntary Arbitrator Danilo Lorredo

Facts:
Petitioner Kimberly-Clark Philippines, Inc. (KCPI), seeks to set aside the Resolutions of 15 October 1991
and 21 November 1991 of public respondent Voluntary Arbitrator Danilo Lorredo, holding that the nephew of a
retired employee should be employed by KCPI as his replacement pursuant to Section 1, Article XX, of their
Collective Bargaining Agreement ( CBA ).
The pertinent provisions of the CBA, relevant to the controversy, is hereinafter quoted:

Art. XX Resignation, Retirement, Disability and Death.

Sec. 1. The COMPANY agrees to employ , the immediate member of the family of an employee provided
qualified, upon the employees resignation, retirement, disability or death. In case of resignation, however,
employment of an immediate member of the family of an employee may be allowed provided the employee has
rendered a service of ten (10) years and above the resignation is not a forced resignation. For the purpose of
this section the phrase immediate member of the family of an employee shall refer to the employees
legitimate children and in default thereof to the employees collateral relative within the third civil degree. The
recommendee of the retired/resigned employee shall, if qualified, be hired on probationary.

Danilo Guerrero, an employee assigned as Operator B in KCPIs Finishing Section, voluntary resigned on
02 January 1991, after thirteen (13) years and three(3) months of employment with the petitioner corporation.
Pursuant to Section 1, Article XX, of the aforementioned CBA, Guerrero through the Union, recommended for
hiring his nephew who is a collateral relative within the third civil degree. KCPI informed the Union, through its
President, that it could not act favorably on Guerreros recommendee in as much as Mr. Danilo has legitimate
children. The private respondent argued that, since Guerreros legitimate children are still minors, he could
validly recommend for hiring his nephew. Failing to agree on the proper interpretation of Article XX, Section 1,
of the CBA and after exhausting remedies through the grievance machinery, the parties agreed to submit their
dispute for voluntary arbitration.
Issue:
Whether or not the Unions or the Companys interpretation is correct.
Held:
A collective bargaining agreement, just like any other contract, respected as the law between the
contracting parties and compliance therewith in good faith is mandated. Similarly, the rules embodied in the
Civil Code on the proper interpretation of contracts can very well govern. The intention of the parties is
primordial ; if the terms of the contract are clear, the literal meaning of the stipulations shall control, but if the
words appear to be contrary to the evident intention of the parties, the latter shall prevail over the former.
The company has agreed in its CBA with the employees to employ (an) immediate member of the family
provided qualified upon the employees resignation, retirement, disability or death. This is its basic covenant.
Covered by the term (an) immediate member of the family. are the employees legitimate children and, in
default thereof, a collateral relative within the third civil degree; it is thus a definition by inclusion. As we see it,
the phrase in default thereof has not been intended or contemplated by the parties as having a preclusive
effect within the group. It simply sets a priority on who can possibly be recommendees for employment. The
employee, in fine, need not be children at all for him to be allowed to nominate a third degree collateral relative;
otherwise, his ability to designate such relative is all but suddenly by birth of an only child and regained by the
latters demise.
 AQUINO v. NATIONAL LABOR RELATIONS COMMISSION
FACTS:
The petitioners were employees of private respondent Otis Elevator Company when they were informed of the
termination of their employment in line with the need of the company "to streamline its operations, consolidate
certain functions, reduce its manpower and cut non-essential spending."
In lieu of notice, you shall be paid one months equivalent salary, plus your regular allowances, counted from
such date, and you shall be covered with the normal benefits for that period. you shall also be paid your earned
and/or unused sick leave and vacation leave, including your pro-rata 13th month pay. And for every year of
service with the Company, you shall be paid one months basic salary or your retirement benefits, if applicable
to you, whichever is higher. 1

Accordingly, petitioners were paid their separation pay, computed as follows:

Basic monthly Years in Separation

salary service Pay

Conrado M. Aquino P4,300 22 P94,600

Napoleon P. Aromin 10,350 22 227,700

Roberto A. Gaspan 3,800 19 72,200

Nicardo P. Blanquisco 8,800 13 110,500

The separation pay was based on Section 4, Article VII of the Collective Bargaining Agreement between the
company and its employees providing thus:chanrob1es virtual 1aw library

All employees in the bargaining unit separated without cause shall be granted separation pay of not less than
one (1) months latest basic rate for every year of service subject to the existing provisions of the Retirement
Plan.

In justifying their subsequent demand for retirement benefits before the Labor Arbiter, the petitioners invoked
Section 1, Article XIV, of the CBA in relation to Section 5.2, Article V, of the companys Retirement Plan, which
provides:chanrob1es virtual 1aw library

5.2 A Participant who is terminated from employment and who has rendered at least ten (10) years of service
shall be entitled to receive in lump sum all or a portion of his accrued benefit credits as of his date of
termination, in accordance with the following schedule:chanrob1es virtual 1aw library

Years of Service Vested Percentage

Upon Termination of Benefit Credits

Less than 10 years NIL

10 to less than 15 50%

15 to less than 20 75%

20 years and over 100%

The respondent company argued that separation ply and retirement benefits were mutually exclusive; hence,
the petitioners could no longer claim the latter after having received the former.
The Labor Arbiter ruled in favor of the petitioners mainly on the ground that the company was estopped from
withholding retirement benefits from them after having granted similar benefits to the employees earlier
mentioned. He held that a different treatment of the petitioners would constitute discrimination because
benefits accorded to other employees must likewise be extended to the rest who are similarly situated."
In reversing the appealed decision, the NLRC declared that the case cited by the petitioners was exceptional
and could not be considered a precedent. Moreover

The CBA provision is very clear that while the employees separated without cause are entitled to a separation
pay of not less than one (1) months latest basic rate for every year of service, this is made merely subject to
and not in addition to the existing provisions of Section 5.2 of the Article V of the Retirement Plan. In other
words, no logical inference can be made that the benefits under Section 5.2 of Article V of the Retirement in
addition to the one (1) months latest basic rate for every year of service. (sic) Therefore, the offer of appellant
perfectly fits well within the contemplation of the parties as envisaged in the aforementioned provisions of the
CBA and the Retirement Plan.
ISSUE: WON the petitioners are still entitled to retirement benefits, even having received a separation pay
RULING:
LABOR AND SOCIAL LEGISLATION; SEPARATION PAY; DISTINGUISHED FROM RETIREMENT
BENEFITS. Separation pay is required in the cases enumerated in Articles 283 and 284 of the Labor Code,
which include retrenchment, and is computed at least one month salary or at the rate of one-half month salary
for every year of service, whichever is higher. We have held that it is as statutory right designed to provide the
employee with the wherewithal during the period that he is looking for another employment. Retirement
benefits, where not mandated by law, may be granted by agreement of the employees and their employer or
as a voluntary act on the part of the employer. Retirement benefits are intended to help the employee enjoy the
remaining years of his life, lessening the burden of worrying for his financial support, and are a form of reward
for his loyalty and service to the employer.
It is on the basis of these distinctions that the petitioners claim to be entitled not only to the separation pay they
have already received but also to the retirement benefits provided for in the Retirement Plan of the respondent
company.

In rejecting this contention, the private respondent insists that the retirement benefits are subject to the
provisions of the Retirement Plan under Section 4 of the CBA. Moreover, under the Omnibus Implementing
Rules of the Labor Code, retired employees whose services are terminated shall receive the corresponding
retirement benefits or separation pay, whichever is higher. 6 This clearly indicates that one benefit should
exclude the other. The petitioners are covered by the Retirement Plan because they have contributed to the
retirement fund, have been separated by reason of the retrenchment, and have served the company for more
than the prescribed minimum period of ten years.
IN THE ABSENCE OF PROHIBITION, EMPLOYEE WHO RECEIVED THEREOF MAY STILL RECEIVE
OTHER BENEFITS PROVIDED IN THEIR COLLECTIVE BARGAINING AGREEMENT; If there is no
provision contained in the collective bargaining agreement to the effect that benefits received under the
Termination Pay Law shall preclude the employee from receiving other benefits from the agreement, then said
employee is entitled to the benefits embodied in the agreement in addition to whatever benefits are mandated
by statute. In the case at bar, there is no such provision. We cannot presume that it forms an implicit part of
either the CBA or the law. Separation pay arising from a forced termination of employment and benefits given
as a contractual right due to many years of faithful service are not necessarily antagonistic to each other,
especially where there are strong equitable considerations as in this case.
After examination of the record, and particularly the Collective Bargaining Agreement and the Retirement Plan,
and have found no specific prohibition against the payment of both benefits to the employee.