G.R. No. 85985 August 13, 1993 [G.R. No. 116172.

October 10, 1996]

PHILIPPINE AIRLINES, INC. (PAL) vs. NATIONAL LABOR RELATIONS SAN MIGUEL FOODS, INC.-CEBU B-MEG FEED PLANT, petitioner, vs. HON.
COMMISSION, LABOR ARBITER ISABEL P. ORTIGUERRA and PHILIPPINE BIENVENIDO E. LAGUESMA, Undersecretary of DOLE and ILAW AT BUKLOD
AIRLINES EMPLOYEES ASSOCIATION (PALEA) NG MANGGAGAWA (IBM), respondents.

Facts:
PAL completely revised its 1966 Code of Discipline. The Code was circulated among the
employees and was immediately implemented, and some employees were forthwith subjected
to the disciplinary measures embodied therein. This prompted the Phil Airlines Employees
Association to file a complaint before the NLRC for unfair labor practice.
PALEA contended that PAL, by its unilateral implementation of the Code, was guilty of
unfair labor practice; that being penal in nature the Code must conform with the requirements
of sufficient publication, and that the Code was arbitrary, oppressive and prejudicial to the
rights of the employees.
Facts:
Ilaw at Buklod ng Manggagawa filed a petition for certification election among the monthly-
paid employees of San Miguel contending that it is a legitimate labor organization duly
registered with DOLE, that there has been no certification election conducted in SMFI to
determine the sole and exclusive bargaining agent thereat and that it has already complied
with the mandatory requirements for the creation of its local or affiliate in SMFIs
establishment.
SMFI filed a Motion to Dismiss

PAL filed a motion to dismiss the complaint, asserting its prerogative as an employer to
prescribe rules and regulations regarding employees’ conduct.

Labor Arbiter ruled in favor of PALEA. PAL appealed to NLRC. However, NLRC dismissed
the appeal and stated that, “In a sense, participation by the union in the adoption of the code if
conduct could have accelerated and enhanced their feelings of belonging and would have
resulted in cooperation rather than resistance to the Code. In fact, labor-management
cooperation is now "the thing."

Issue: Whether or not the formulation of a Code of Discipline among employees is a shared
responsibility of the employer and the employees

Ruling: YES. Verily, a line must be drawn between management prerogatives regarding
business operations per se and those which affect the rights of the employees. In treating the
latter, management should see to it that its employees are at least properly informed of its
decisions or modes action. PAL asserts that all its employees have been furnished copies of
the Code. Public respondents found to the contrary, which finding, to say the least is entitled
to great respect.

Indeed, industrial peace cannot be achieved if the employees are denied their just
participation in the discussion of matters affecting their rights. Thus, even before Article 211
of the labor Code (P.D. 442) was amended by Republic Act No. 6715, it was already declared
a policy of the State, "(d) To promote the enlightenment of workers concerning their rights
and obligations . . . as employees." This was, of course, amplified by Republic Act No 6715
when it decreed the "participation of workers in decision and policy making processes
affecting their rights, duties and welfare." PAL's position that it cannot be saddled with the
"obligation" of sharing management prerogatives as during the formulation of the Code,
Republic Act No. 6715 had not yet been enacted (Petitioner's Memorandum, p. 44; Rollo, p.
212), cannot thus be sustained. While such "obligation" was not yet founded in law when the
Code was formulated, the attainment of a harmonious labor-management relationship and the
then already existing state policy of enlightening workers concerning their rights as
employees demand no less than the observance of transparency in managerial moves
affecting employees' rights.
G.R. No. 94754 May 11, 1993
U-SING BUTTON AND BUCKLE INDUSTRY and SY BAN vs.
NATIONAL LABOR RELATIONS COMMISSION, LABOR ARBITER DAISY G.
CAUTON-BARCELONA and CECILIA NAYA

Facts:

Fortunato Naya worked as maintenance worker at U-Sing Button and Buckles. Years after,
Naya stopped working on account of his illness and died shortly thereafter. His widow,
Cecilia NAya then filed a claim for separation pay and incentive leave pay due her husband.

U-Sing, in order to escape liability, presented evidence of Fortunator’s alleged indebtedness

to them