Molave Motor Sales vs.

Judge Laron being aware of the last amendment to the frequently changing
Labor Code. The claim of DEFENDANT that he should still be
Facts :
considered an employee of PLAINTIFF, because the latter has
Petitioner is a corporation engaged in the sale and repair of not sought clearance for his separation from the service, will not
motor vehicles. Private respondent is the sales manager of affect the jurisdiction of respondent Judge to resolve the
petitioner corporation. At the pre-trial conference, the complaint of PLAINTIFF. DEFENDANT could still be liable to
DEFENDANT raised the question of jurisdiction of the Court PLAINTIFF for payment of the accounts sued for even if he
stating that PLAINTIFF's complaint arose out of employer- remains an employee of PLAINTIFF.
employee relationship, and he subsequently moved for
dismissal. Such complaint was dismissed by the judge because it
must be the juris of the LA and NLRC to decide cases on ER-EE
relationship. However, although a controversy is between an
employer and an employee, the Labor Arbiters have no
jurisdiction if the Labor Code is not involved. In this case,
PLAINTIFF had sued for monies loaned to DEFENDANT, the
cost of repair jobs made on his personal cars, and for the
purchase price of vehicles and parts sold to him. Those accounts
have no relevance to the Labor Code. hence, the civil has the
juris over the matter.
Issue
Whether or not there was still a relationship of employer and
employee between the parties.
Held
The dismissal of the case below on the ground that the sum of
money and damages sued upon arose from employer-employee
relationship was erroneous. Claims arising from employer-
employee relations are now limited to those mentioned in
paragraphs 2 and 3 of Article 217. There is no difficulty in
stating that those in the case below should not be faulted for not
Jaguar Security and Investigation Agency The jurisdiction of labor courts extends only to cases where an employer-employee
relationship exists.
Vs

Rodolfo Sales, etc.

In the present case, there exists no employer-employee relationship between
Facts: petitioner and Delta Milling. In its cross-claim, petitioner is not seeking any relief
under the Labor Code but merely reimbursement of the monetary benefits claims
Jaguar is a private corporation engaged in the business of providing security
awarded and to be paid to the guard employees. There is no labor dispute involved
services; one of their clients is Delta Milling Industries, Inc. The respondents were
in the cross-claim against Delta Milling. Rather, the cross-claim involves a civil
hired as security guards by Jaguar and were assigned at the premises of Delta. Later
dispute between petitioner and Delta Milling. Petitioner's cross-claim is within the
on, the security guards instituted an instant labor case before the labor arbiter
realm of civil law, and jurisdiction over it belongs to the regular courts.
alleging money claims for their services. On July 1, 1999, petitioner Jaguar filed a
partial appeal questioning the failure of public respondent NLRC to resolve its
cross-claim against Delta as the party ultimately liable for payment of the monetary
award to the security guards. Moreover, the liability of Delta Milling to reimburse petitioner will only arise if and
when petitioner actually pays its employees the adjudged liabilities.
Petitioner insists that its cross-claim should have been ruled upon in the labor case
as the filing of a cross-claim is allowed under Section 3 of the NLRC Rules of
Procedure which provides for the suppletory application of the Rules of Court.
Petitioner argues that the claim arose out of the transaction or occurrence that is the
subject matter of the original action. Petitioner further argues that as principal, Delta
Milling Industries, Inc. (Delta Milling) is liable for the awarded wage increases.

There is no question as regards the respective liabilities of petitioner and Delta

Milling. Under Articles 106, 107 and 109 of the Labor Code, the joint and several
liability of the contractor and the principal is mandated to assure compliance of the
provisions therein including the statutory minimum wage. The contractor, petitioner
in this case, is made liable by virtue of his status as direct employer. On the other
hand, Delta Milling, as principal, is made the indirect employer of the contractor's
employees for purposes of paying the employees their wages should the contractor
be unable to pay them. This joint and several liability facilitates, if not guarantees,
payment of the workers' performance of any work, task, job or project, thus giving
the workers ample protection as mandated by the 1987 Constitution.

Issue: whether petitioner may claim reimbursement from Delta Milling through a
cross-claim filed with the labor court?

Ruling:
LESLIE W. ESPINO, petitioner, “Controversies in the election or appointments of directors, trustees, officers or
managers of such corporations, partnerships or associations.”
vs.
It has been ruled that a corporate officer’s dismissal is always a corporate act and/or
HON. NATIONAL LABOR RELATIONS COMMISSION and PHILIPPINE an intra-corporate controversy and that nature is not altered by the reason or wisdom
AIR LINES, respondents. which the Board of Directors may have in taking such action. Evidently, this intra-
corporate controversy must be place under the specialized competence and expertise
FACTS:
of the SEC.
Petitioner Leslie W. Espino was the Exec. Vice President-Chief Operating Officer of
The fact that petitioner sought payment of his backwages, other benefits, as well as
respondent Phil Airlines (PAL) when his service was terminated in 1990 as a result
damages and attorney's fees in his complaint for illegal dismissal will not operate to
of the findings of the panels created by then President Corazon C. Aquino to
prevent the SEC from exercising its jurisdiction under PD 902-A. As to the
investigate the administrative charges filed against him. It appears that petitioner and
contention of Espino that PAL is estopped from questioning the jurisdiction of the
other several senior officers of PAL were charged for their involvement in 4 cases,
NLRC, it is well-settled that jurisdiction over the subject matter is conferred by law
labeled as “Goldair,” “Robelle,” “Kabash/Primavera,” and “Middle East.”
and the question of lack of jurisdiction may be raised anytime even on appeal.
The PAL Board of Directors issued separate resolutions wherein Espino was
considered resign from the service effective immediately for loss of confidence

Espino filed a complaint for “illegal dismissal” against PAL with the NLRC,
Arbitration Branch, NCR.

PAL argued that board resolutions cannot be reviewed by the NLRC and that the
recourse of the petitioner Espino should have been addressed by way of appeal, to
the OP.

PAL asserted that the Labor Arbiter’s decision is null and void for lack of
jurisdiction over the subject matter as it is the SEC, and not the NLRC which has
jurisdiction over involving dismissal or removal of corporate officers.

NLRC promulgated a resolution and this time ruled in favor of PAL on the ground
of lack of jurisdiction

Petitioner Espino contended that it is the NLRC that has jurisdiction over the case as
it involves the termination of a regular employee and involves claim for backwages
and other benefits and damages

Issue: Whether the NLRC has jurisdiction over the complaint filed by the petitioner
for illegal dismissal

HELD: NO Under P.D. No. 902-A, it is the Securities and Exchange Commission
and not the NLRC that has original and exclusive jurisdiction over cases involving
the removal from employment of corporate officers. Under the said decree, the SEC
has the exclusive and original jurisdiction to hear and decide cases involving
MANEJA VS NLRC 290 SCRA 603 (1998) interpretation or enforcement of company personnel policies but is a termination
dispute which comes under the jurisdiction of the Labor Arbiter.

It should be explained that “company personnel policies” are guiding principles

FACTS: Petitioner Rosario Maneja worked with private respondent Manila
Midtown Hotel beginning January 1985, as a telephone operator. She was a member
of the National Union of Workers in Hotels, Restaurants and Allied Industries
(NUWHRAIN) with an existing CBA with the private respondent.
On March 7, the chief telephone operator asked the petitioner and Loleng to explain
the Feb 15 incident. Both submitted their written explanation. On March 20, a
written report was submitted, stating that their actions were covered violations of the
Offenses Subject to Disciplinary Action (OSDA) as
stated in broad, long-range terms express the philosophy or beliefs of an
organization’s top authority regarding personnel matters. They deal with matters
affecting efficiency and well-being of employees and include, among others, the
procedure in the administration of wages, benefits, promotions, transfer and other
personnel movements which are usually not spelled out in the collective agreement.
The usual source of grievances, however, are the rules and regulations governing
disciplinary actions.

1.Forging, falsifying official documents and;

2.Culpable carelessness—negligence or failure to follow specific instruction/s or

established procedure/s

On March 23, petitioner was then served notice of dismissal effective on April 1.
She refused to sign and wrote “under protest.”

On October 2, 1990, Maneja filed a complaint for illegal dismissal against private
respondent before the labor arbiter (LA). LA found that the petitioner was illegally
dismissed, stating that even though the case revolves on the matter of
implementation and interpretation of company policies and is thus within the
jurisdiction of the grievance procedure under the CBA, Art. 217 Labor Code confers
original and exclusive jurisdiction of all termination cases to LA. NLRC dismissed
the case for lack of jurisdiction of LA because the case was subject to voluntary
arbitration.

Petitioner insists that her termination is not an unresolved grievance as there had
been no grievance meeting between the union and the management. Petitioner
alleged that it has been a company policy that termination cases are not referred to
the grievance machinery but directly to LA.

ISSUE:

Does the Labor Arbiter have jurisdiction over the case?

Ruling:

Yes. Since there has been an actual termination, the matter falls within the
jurisdiction of the Labor Arbiter. The dismissal of Maneja does not call for the
SANYO PHIL. WORKERS UNION VS. CANIZARES designated by the union and the company cannot be expected to be impartial against
the dismissed employees. Due process demands that the dismissed workers
FACTS: grievances be ventilated before an impartial body. Since there has already been an
actual termination, the matter falls within the jurisdiction of the Labor Arbiter
PSSLU had an existing CBA with Sanyo. The CBA contained a union security
clause. PSSLU wrote Sanyo that the private respondents/employees were notified
that their membership with PSSLU were cancelled for anti-union, activities,
economic sabotage, threats, coercion and intimidation, disloyalty and for joining
another union called KAMAO. In accordance with the security clause of the CBA,
Sanyo dismissed the employees. The dismissed employees filed a complaint with the
NLRC for illegal dismissal. Named respondent were PSSLU and Sanyo .PSSLU
filed a motion to dismiss the complaint alleging that the Labor Arbiter was without
jurisdiction over the case, relying on Article 217(c) of the Labor Code which
provides that cases arising from the interpretation or implementation of the CBA
shall be disposed of by the labor arbiter by referring the same to the grievance
machinery and voluntary arbitration. Nevertheless, the Labor Arbiter assumed
jurisdiction. Public respondent through the Sol Gen, argued that the case at bar
does not involve an "interpretation or implementation" of a collective bargaining
agreement or "interpretation or enforcement" of company policies but involves a
"termination." Where the dispute is just in the interpretation, implementation or
enforcement stage, it may be referred to the grievance machinery set up in the CBA
or by voluntary arbitration. Where there was already actual termination, i.e.,
violation of rights, it is already cognizable by the Labor Arbiter.

ISSUE:

Whether or not the Labor Arbiter has jurisdiction over the case.

HELD:

We hold that the Labor Arbiter and not the Grievance Machinery provided for in the
CBA has the jurisdiction to hear and decide the case. While it appears that the
dismissal of the private respondents was made upon the recommendation of PSSLU
pursuant to the union security clause provided in the CBA, We are of the opinion
that these facts do not come within the phrase "grievances arising from the
interpretation or implementation of (their) Collective Bargaining Agreement and
those arising from the interpretation or enforcement of company personnel policies,"
the jurisdiction of which pertains to the Grievance Machinery or thereafter, to a
voluntary arbitrator or panel of voluntary arbitrators. No grievance between them
exists which could be brought to a grievance machinery. The problem or dispute in
the present case is between the union and the company on the one hand and some
union and non-union members who were dismissed, on the other hand. The dispute
has to be settled before an impartial body. The grievance machinery with members
PANTRANCO NORTH EXPRESS INC. VS. NLRC upon the provision on "compulsory retirement" as embodied in the CBA. Also, it
was only private respondent on his own who questioned the compulsory
[G.R. No. 95940, July 24, 1996] retirement. Thus, the case is properly denominated as a "termination dispute" which
comes under the jurisdiction of labor arbiters.
Facts: Private respondent Suñiga was hired by petitioner as a bus conductor, and
joined the Pantranco Employees Association-PTGWO. He continued in petitioner's Therefore, public respondent did not commit a grave abuse of discretion in
employ until he retired at the age of fifty-two (52) after having rendered twenty five upholding the jurisdiction of the labor arbiter over this case.
years' service. The basis of his retirement was the compulsory retirement provision
of the CBA between the petitioner and the union. Private respondent received
P49,300.00 as retirement pay. Suñiga filed a complaint for illegal dismissal against
petitioner with the Sub-Regional Arbitration Branch of the respondent
Commission. LA found that the three complainants are illegally and unjustly
dismissed and ordered the respondent to reinstate them to their former or
substantially equivalent positions without loss of seniority rights with full
backwages and other benefits.

The amounts already received by complainants shall be considered as advanced

payment of their retirement pay which shall be deducted when they shall actually
retire or (be) separated from the service. The order of reinstatement was immediately
executory even pending appeal. Petitioner appealed to public respondent, which
issued the questioned Resolution affirming the labor arbiter's decision in toto.

Issues:

1. Whether or not the Labor Arbiter has jurisdiction

Ruling:

Jurisdiction of Labor Arbiter

In the instant case, both the union and the company are united or have come to an
agreement regarding the dismissal of private respondents. No grievance between
them exists which could be brought to a grievance machinery. The problem or
dispute in the present case is between the union and the company on the one hand
and some union and non-union members who were dismissed, on the other
hand. The dispute has to be settled before an impartial body. The grievance
machinery with members designated by the union and the company cannot be
expected to be impartial against the dismissed employees. Due process demands
that the dismissed workers’ grievances be ventilated before an impartial body. Since
there has already been an actual termination, the matter falls within the jurisdiction
of the Labor Arbiter."

Applying the same rationale to the case at bar, it cannot be said that the "dispute" is
between the union and petitioner company because both have previously agreed
Santos vs Servier That he is paid separation pay equivalent to at least one (1) month salary or to one-
half (1/2) month salary for every year of service, whichever is greater, a fraction of
Facts: at least six (6) months being considered as one (1) whole year.
Petitioner Ma. Isabel T. Santos was the Human Resource Manager of respondent
Servier Philippines, Inc. since 1991 until her termination from service in 1999. On
March 26 and 27, 1998, petitioner attended a meeting of all human resource
managers of respondent, held in Paris, France. Since the last day of the meeting
coincided with the graduation of petitioner’s only child, she arranged for a European
vacation with her family right after the meeting. She, thus, filed a vacation leave
effective March 30, 1998

As a consequence of petitioner’s termination from employment, respondent offered

a retirement package. Of the promised retirement benefits amounting
to P1,063,841.76, only P701,454.89 was released to petitioner’s husband, the
balance11 thereof was withheld allegedly for taxation purposes. Respondent also
failed to give the other benefits listed above.12

Petitioner, represented by her husband, instituted the instant case for unpaid salaries;
unpaid separation pay; unpaid balance of retirement package plus interest; insurance
pension for permanent disability; educational assistance for her son; medical
assistance; reimbursement of medical and rehabilitation expenses; moral, exemplary,
and actual damages, plus attorney’s fees

Issue:

Whether or not the deduction of taxes falls within the jurisdiction of lobor arbiter.

Ruling:

Yes.

Records reveal that as early as in petitioner’s position paper filed with the Labor
Arbiter, she already raised the legality of said deduction, albeit designated as
"unpaid balance of the retirement package." Petitioner specifically averred
that P362,386.87 was not given to her by respondent as it was allegedly a part of the
former’s taxable income.39 This is likewise evident in the Labor Arbiter and the
NLRC’s decisions although they ruled that the issue was beyond the tribunal’s
jurisdiction. They even suggested that petitioner’s claim for illegal deduction could
be addressed by filing a tax refund with the Bureau of Internal Revenue.

An employer may terminate the services of an employee who has been found to be
suffering from any disease and whose continued employment is prohibited by law or
is prejudicial to his health as well as to the health of his co-employees: Provided,
 thus labor arbiters have the original and exclusive
Air Material Wing Services and Loan (AMWSLAI) v jurisdiction. As provided under Art. 3 of 217 of theLabor
NLRC Code, claims which have reasonable connection with ER-
FACTS: EE relationship are under the jurisdiction of the
Private respondent Salas was appointed notarial and laborarbiter.In respect to the separate payment of notarial
legal counsel for petitioner. The petitioner issued fees to Salas, the contract does not contain any
ano r d e r r e m i n d i n g S a l a s o f t h e a p p r o a c h i n g t stipulationabout it. Absence of such stipulation does
ermination of his legal services. This prompt not entitle the respondent to collect separate payment of
e d S a l a s t o l o d g e a complaint against petitioner for notarial fees.
separation pay, vacation and sick leave benefits and
others. Petitioner moved todismiss alleging that there was no
employer-employee relationship between them.
ISSUE:
W/N ER-ER exists between petitioner and respondent
HELD:
Yes. The terms and conditions in the contract show that
respondent was an employee of petitioner. His
selectionas the company counsel was done by the board
of directors and the respondent was paid with a
monthly retainer’sfee. The petitioner also reserved its
power of dismissal by defining the duties of the
respondent as its legal counselsuch as acting on all legal
matters and seeking remedies to effect collection of
overdue accounts.As cited in the case of Hydro
Resources v. Pagalilauan, “A lawyer, like any
other professional (doctors,nurses, dentists, public
relations practitioners), may very well be an employee of
a private corporation or even of the government. It is not
unusual for a big corporation to hire a staff of lawyers as
its in-house counsel, pay themregular salaries, rank them and
treat them like its other officers and employees.”With regards
to Salas’ claim of notarial fees, it is based on his
employment as a notarial officer of thepetitioner and
Sentinel Insurance VS Baustista
Facts:
The complainants were employees of Sentinel . They
were assigned to render guard duty at the premises of
[Philippine American Life Insurance Company] at Jones
Avenue, Cebu City. On December 16, 1993 Philippine
American Life Insurance Company [the Client, for
brevity], through Carlos De Pano, Jr., sent notice to all
concerned that the [Agency] was again awarded the
contract of [s]ecurity [s]ervices together with a request
to replace all the security guards in the companys
offices at the cities of Cebu, Bacolod, Cagayan de Oro,
Dipolog and Ilagan. In compliance therewith, [the
Agency] issued on January 12, 1994, a Relief and
Transfer Order replacing the complainants as guards [of
the Client] and for then to be re-assigned [to] other
clients effective January 16, 1994. As ordered, the
complainants reported but were never given new
assignments but instead they were told in the
vernacular, gui-ilisa mo kay mga tigulang naman
mo which when translated means, you were replace[d]
because you are already old. Precisely, the
complainants lost no time but filed the subject illegal
dismissal cases on January 18, January 26 and February
4, 1994 and prayed for payment of separation pay and
other labor standard benefits.
Issue:
Whether or not illegally dismissed by their employer,
Sentinel Security Agency, Inc., and in holding petitioner
to be equally liable therefor.
Ruling:
In the case at bar, the relief and transfer order per se did not sever
the employment relationship between the complainants and the
Agency. Thus, despite the fact that complainants were no longer
assigned to the Client, Article 287 of the Labor Code, as amended by
RA 7641, still binds the Agency to provide them upon their reaching
the retirement age of sixty to sixty-five years retirement pay or
whatever else was established in the collective bargaining
agreement or in any other applicable employment contract. On the
other hand, the Client is not liable to the complainants for their
retirement pay because of the absence of an employer-employee
relationship between them.
We agree that the security guards were illegally dismissed, but not
for the reasons given by the public respondent. The aforecited
contentions of the NLRC are speculative and unsupported by the
evidence on record. As the solicitor general said in his Manifestation
in Lieu of Comment, the relief and transfer order was akin to placing
private respondents on temporary off-detail.
Cagayan de Oro VS MOLE
Facts:
Cagayan de Oro Coliseum, Inc. is a corporation duly organized and existing under
Philippine laws having been issued a certificate of registration by the Securities and
Exchange Commission (SEC) on September 15, 1961.[1] Its principal line of
business is the holding of cockfights and occasional boxing matches.[2] Angel
Chaves, on the other hand, is an incorporator and major stockholder of the
corporation who, for sometime, served as its director and officer.

Claiming that he had not been paid for services rendered, Chaves filed on June 3,
1977 a letter complaint with the Field Services Division of the then Department of
Labor, Regional Office No. 10. Consequently, said office investigated the corpo-
ration and found the following: (1) unpaid wages for officers and office personnel;
(2) nonpayment of emergency cost of living allowance (ECOLA) under P.D. No.
525; (3) nonpayment of 13th month pay under P.D. No. 851; and (4) nonpayment of
special/regular holiday pay. The investigation also disclosed that although Atty.
Angel Quimpo, general manager of the corporation, had signified his intention to
pay the corporation's obligation to its employees or officers in the amount of
P79,773.72 for per diems, allowances, 13th month pay and others as duly certified to
by the corporation's bookkeeper and treasurer, no resolution was passed by its
stockholders or the Board to implement said plan.

ISSUE:
is which of the two, the MOLE (now DOLE) and the SEC has jurisdiction over the
present controversy

Ruling:

An intracorporate controversy would call for the jurisdiction of the SEC while a
labor dispute, that of the NLRC or the MOLE as the case may be.[10] But when
a case is between a stockholder and the corporation of which he holds stocks, the
controversy is intracorporate and well within the jurisdiction of the SEC.[

Finding that the MOLE has no jurisdiction to take cognizance of the herein
controversy, there is no need to resolve the other issues raisedin this petition.
Ernesto Apodaca vs NLRC a i d subscriptions. This controversy is within the
exclusive jurisdiction of the Securitiesand Exchange
FACTS: Commission.(2) No. the unpaid subscriptions are not due
Petitioner was employed in respondent corporation. He and payable until a call is made by thecorporation for
was persuaded byrespondent Mirasol to subscribe payment. Private respondents have not presented a
to 1,500 shares or for a total of P150,000.00. resolution of theboard of directors of respondent
Hepaid P37,500.00. On September 1, 1975, corporation calling for the payment of the
petitioner was appointed President andGeneral unpaidsubscriptions. It does not even appear that a
Manager of the respondent corporation. However, on notice of such call has been sent topetitioner by
January 2, 1986, the respondent corporation. As there was no
her e s i g n e d . p e t i t i o n e r i n s t i t u t e d w i t h t h e notice or call for thepayment of unpaid subscriptions,
N L R C a c o m p l a i n t a g a i n s t p r i v a t e respond the same is not yet due and payable.Even if there was a
ents for the payment of his unpaid wages, his cost of call for payment, the NLRC cannot validly set it off
living allowance, thebalance of his gasoline and against thewages and other benefits due petitioner.
representation expenses and his bonus compensationfor Article 113 of the Labor Code allows such
1986. Private respondents admitted that there is due to ad e d u c t i o n f r o m t h e w a g e s o f t h e e m p l o y
petitioner the amount of P17,060.07 but this was e e s b y t h e e m p l o y e r , o n l y i n t h r e e instances
applied to the unpaid balance of his subscription
in theamount of P95,439.93. Petitioner questioned the
set-off alleging that there was nocall or notice for the
payment of the unpaid subscription and that, accordingly,
thealleged obligation is not enforceable.
ISSUES:
Whether or not NLRC has jurisdiction
to resolve a claim for non-
payment of stock subscriptions to a corporati
o n . ( 2 ) I f s o , w h e t h e r o r n o t a n obligation arising
therefrom be offset against a money claim of an
employee againstthe employer.
RULING:
NLRC has no jurisdiction to determine such intra-
corporate
disputeb e t w e e n t h e s t o c k h o l d e r a n d t h
e corporation as in the matter of unp
DAI-CHI ELECTRONICS MANUFACTURING CORPORATION

vs MARTIN S. VILLARAMA and ADONIS C. LIMJUCO

facts:

Dai-Chi filed a complaint for damages with the Pasig RTC, Br 156, Pasig against
Limjuco, a former employee. Dai-Chi alleged that Limjuco violated paragraph five
of their Contract of Employment Dai-Chi claimed that Limjuco became an employee
of Angel Sound Philippines Corporation, a corporation engaged in the same line of
business as that of Dai-Chi, within two years from January 30, 1992, the date of
Limjuco's resignation.

Dai-Chi further alleged that Limjuco is holding the position of Head of the Material
Management Control Department, the same position he held while in the employ of
Dai-Chi.

ISSUE: Whether Dai-Chi's claim for damages is one arising from employer-
employee relations

Ruling:

It was held in that case that jurisdiction over the controversy belongs to the civil
courts. We stated that the action was for breach of a contractual obligation, which is
intrinsically a civil dispute. We further stated that while seemingly the cause of
action arose from employer-employee relations, the employer's claim for damages is
grounded on "wanton failure and refusal" without just cause to report to duty
coupled with the averment that the employee "maliciously and with bad faith"
violated the terms and conditions of the contract to the damage of the employer.
Such averments removed the controversy from the coverage of the Labor Code and
brought it within the purview of Civil Law.

Jurisprudence has evolved the rule that claims for damages under paragraph 4 of
Article 217, to be cognizable by the Labor Arbiter, must have a reasonable causal
connection with any of the claims provided for in that article. Only if there is such a
connection with the other claims can the claim for damages be considered as arising
from employer-employee relations.
Singapore Airlines vs. Hon.Ernani Cruz-Pano

Facts: Private Respondent Carlos Cruz was offered employment by petitioner as

Engineer Officer with the opportunity to undergo a training course. Cruz signed the
Agreement with his co-respondent Villanueva, as surety. Claiming that Cruz had
applied for "leave without pay" and had gone on leave without approval of the
application during the second year of the Period of five years, petitioner filed suit for
damages against Cruz and his surety, Villanueva, for violation of the terms and
conditions of the aforesaid Agreement. Petitioner sought the payment of the
following sums. Cruz denied any breach of contract contending that at no time had
he been required by petitioner to agree to a straight service of five years under
Clause 4 of the Agreement and that he left the service on "valid compassionate
grounds stated to and accepted by the company so that no damages may be awarded
against him.

Respondent Judge issued the assailed Order dismissing the complaint, counterclaim
and crossclaim for lack of jurisdiction because the present case involved a money
claim arising from an employer-employee relation or at the very least a case arising
from employer-employee relations, which under Art. 216 of the Labor Code is
vested exclusively with the Labor Arbiters of the National Labor Relations
Commission.

Issue: Whether or not the case is properly cognizable by Courts of justice.

Ruling: Yes. While seemingly petitioner's claim for damages arises from employer-
employee relations, and the latest amendment to Article 217 of the Labor Code
under PD No. 1691 and BP Blg. 130 provides that all other claims arising from
employer-employee relationship are cognizable by Labor Arbiters, in essence,
petitioner's claim for damages is grounded on the "wanton failure and refusal"
without just cause of private respondent Cruz to report for duty despite repeated
notices served upon him of the disapproval of his application for leave of absence
without pay. This, coupled with the further averment that Cruz "maliciously and
with bad faith" violated the terms and conditions of the conversion training course
agreement to the damage of petitioner removes the present controversy from the
coverage of the Labor Code and brings it within the purview of Civil Law. The
complaint was anchored not on the abandonment per se by private respondent Cruz
of his job as the latter was not required in the Complaint to report back to work but
on the manner and consequent effects of such abandonment of work translated in
terms of the damages which petitioner had to suffer.
RUSTAN SUPERVISORY UNION, vs. HON. MOISES DALISAY RUSTAN of respondent judge arose out of unfair labor practice of respondent company in
PULP AND PAPER MILLS, INC., allegedly refusing to, bargain in good faith and dismissing for union activities the
union officials and members, which are the very subject-matter of the unfair labor
Facts: charge filed by the union in the Industrial Court. These were facts expressly alleged
by petitioner in its Urgent Motion for Reconsideration, asking respondent judge to
Petitioner union is a legitimate labor organization and individual petitioners are the
set aside the questioned orders and raising respondent Court's lack of jurisdiction.
union's principal officers. The union wrote respondent company that a great number
The very complaint of respondent in the case below, for all its artful wording, was
of the supervisory personnel of respondent's plant had affiliated with it and
sufficient on its face to apprise respondent Court that the matter presented before it
presented a set of proposals for incorporation into a collective bargaining agreement.
involved an unfair labor practice case falling within the Industrial Court's exclusive
The respondent unheeded the ultimatum letter sent for union recognition. Thus, the
competence and jurisdiction ... ."
union declared a strike and picketed the company’s premises. Though several
conferences were held at the Iligan City Labor Office between the party’s
representatives, there is no good outcome as petitioner alleges that the company
refused to negotiate with it whereas respondent claims in that it is the petitioners
who refused to negotiate in good faith.

The petitioners filed an urgent motion to dissolve or lift the writ of preliminary
injunction, informing that they were engaged in an industrial dispute with the
respondent company, which is guilty of unfair labor practice in refusing to negotiate
with them as the duly selected bargaining unit, by virtue of which they had struck
and picketed the company's premises and therefore impugning respondent court's
jurisdiction to issue the injunction which in effect enjoined their concerted strike and
picketing activities. However, the respondent court denied it on the ground that the
case has not filed in the Court of Industrial Relations and neither filed a notice of
strike in the Department of Labor.

Issue: Whether or not the respondent court can enjoin the union strike or picketing.

Whether or not notice of strike is necessary.

Ruling:

: The Court finds merit in the petition.

The Court stressed the exclusive jurisdiction of the industrial court as against the
regular courts over unfair labor practices in Veterans Security Free Workers Union
vs. Cloribel 6 thus: "(I)t has long been accepted as dogma that cases involving unfair
labor practice fall within the exclusive jurisdiction of the Court of Industrial
Relations, by virtue of the explicit provisions of Section 5(a) of the Industrial Peace
Act that said Court 'shall have jurisdiction over the prevention of unfair labor
practices and is empowered to prevent any person from engaging in any unfair labor
practice. This power shall be exclusive and shall not be affected by any other means
of adjustment or prevention that has been or may be established by an agreement,
code, law or otherwise.' The strike and picketing restrained by the questioned orders
ANDREW JAMES MCBURNIE, , vs
. EULALIO GANZON, EGI-MANAGERS, INC. and E. GANZON,
INC.,
FACTS:
On October 4, 2002, Andrew James McBurnie (McBurnie), an
Australian national, instituted a complaint for illegal dismissal and
other monetary claims against Eulalio Ganzon, EGI-Managers, Inc.,
and E. Ganzon, Inc., (respondents). McBurnie claimed that on May
11, 1999, he signed a 5-year employment agreement with the
company EGI as an Executive Vice-President who shall oversee the
management of the company hotels and resorts within the
Philippines. He performed work for the company until sometime in
November 1999, when he figured in an accident that compelled him
to go back to Australia while recuperating from his injuries. While in
Australia, he was informed by respondent Ganzon that his services
were no longer needed because their intended project would no
longer push throug:
The respondents contend that their agreement with McBurnie was to
jointly invest in and establish a company for the management of the
hotels. They did not intend to create an employer-employee
relationship, and the execution of the employment contract that was
being invoked by McBurnie was solely for the purpose of allowing
McBurnie to obtain an alien work permit in the Philippines, and that
McBurnie had not obtained a work permit.
ISSUE: Whether or not McBurnie was illegally dismissed?
Ruling: There was no employer-employee relationship.
McBurnie failed to present any employment permit which would have
authorized him to obtain employment in the Philippines.This
circumstance negates McBurnie claim that he had been performing
work for the respondents by virtue of an employer-employee
relationship.The absence of the employment permit instead bolsters
the claim that the supposed employment of McBurnie was merely
simulated, or did not ensue due to the non-fulfillment of the
conditions that were set forth in the letter of May 11, 1999.
McBurnie failed to present other competent evidence to prove his
claim of an employer-employee relationship. iven the
partiesconflicting claims on their true intention in executing the
agreement, it was necessary to resort to the established criteria for
the determination of an employer-employee relationship, 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
employee conduct. The rule of thumb remains: the onus probandi
falls on the claimant to establish or substantiate the claim by the
requisite quantum of evidence.Whoever claims entitlement to the
benefits provided by law should establish his or her right thereto.
McBurnie failed in this regard.As previously observed by the NLRC,
McBurnie even failed to show through any document such as
payslips or vouchers that his salaries during the time that he
allegedly worked for the respondents were paid by the company. In
the absence of an employer-employee relationship between
McBurnie and the respondents, McBurnie could not successfully
claim that he was dismissed, much less illegally dismissed, by the
latter.Even granting that there was such an employer-employee
relationship, the records are barren of any document showing that its
termination was by the respondentsdismissal of McBurnie.
SARA LEE PHILIPPINES, INC, vs. EMILINDA D.
MACATLANG, ET AL
FACTS:
Aris Philippines permanently ceased operations on 9 October
1995 displacing 5,984 rank-and-file employees. On 26 October 1995, FAPI was
incorporated prompting former Aris employees to file a case for illegal dismissal on
the allegations that FAPI was a continuing business of Aris. Sarah Lee Corporation
(SLC), Sarah Lee Philippines (SLP) and Cesar Cruz were impleaded as defendants
being major stockholders of FAPI and officers of Aris, respectively.
On 30 October 2004, the Labor Arbiter found the dismissal of
5,984 Aris employees illegal and awarded them monetary benefits amounting to
P3,453,664,710.86. The judgment award is composed of separation pay of one
month for every year of service, back wages, moral and exemplary damages and
attorney's fees.
NO. The Corporations should have followed the direction of the Court and filed the
additional amount requested by the Courts for the perfection of the appeal so that the
NLRC may proceed to try the merits of the case for illegal dismissal. The 10%
requirement pertains to the reasonable amount which the NLRC would accept as the
minimum of the bond that should accompany the motion to reduce bond in order to
suspend the period to perfect an appeal under the NLRC rules. The 10% is based on
the judgment award and should in no case be construed as the minimum amount of
bond to be posted in order to perfect appeal.
Should the NLRC, after considering the merit of the Motion to
Reduce Appeal Bond determines that a greater amount or the full amount of the
bond needs to be posted by the appellant, then the party shall comply accordingly.
The appellant shall be given a period of 10 days from notice of the NLRC order
within which to perfect the appeal by posting the required appeal bond.
The Petitioners are then directed to post the amount of PHP
725M in cash or surety bond within 10 days of the decision to continue with the
determination of the merits of the alleged illegally dismissed Respondents through
the NLRC.

The Corporations filed a Notice of Appeal with Motion to

Reduce Appeal Bond. They

posted a P4.5 Million bond. The NLRC granted the reduction of the appeal bond and
ordered the Corporations to post an additional P4.5 Million bond.

The 5,984 former Aris employees, represented by Emilinda

Macatlang (Macatlang petition), filed a petition for review before the Court of
Appeals insisting that the appeal was not perfected due to failure of the Corporations
to post the correct amount of the bond which is equivalent to the judgment award.

While the case was pending before the appellate court, the
NLRC prematurely issued an order setting aside the decision of the Labor Arbiter
for being procedurally infirmed.

ISSUE:WON the appeal bond of roughly Php 4.5M is enough to perfect an appeal.

HELD:
BORJA ESTATE HELD:

vs. The appeal bond is required under Article 223 of the Labor Code which provides:

SPOUSES ROTILLO BALLAD and ROSITA BALLAD ART. 223. Appeal. - Decisions, awards or orders of the Labor Arbiter are final and
executory unless appealed to the Commission by any or both parties within ten (10)
G.R. No. 152550 June 8, 2005 calendar days from receipt of such decisions, awards, or orders
TINGA, J.: In case of a judgment involving a monetary award, an appeal by the employer may
be perfected only upon the posting of a cash or surety bond issued by a reputable
FACTS:
bonding company duly accredited by the Commission, in the amount equivalent to
The Ballad spouses had been employed as overseers of the Borja Estate by its the monetary award in the judgment appealed from.
owners, the spouses Manuel Borja and Paula Borja, since 1972. Their appointment
as such was later made in writing per the certification of appointment issued by
Paula Borja.

On 10 November 1996, according to the Ballad spouses, when Francisco Borja,

brother of the late Manuel Borja, was appointed the new administrator, he issued
immediately a memorandum to all the tenants and lessees of the Borja Estate to
transact directly with him and to pay their monthly rentals to him or to his overseers,
the Ballad spouses.

Upon his appointment, Francisco Borja allegedly promised to give the Ballad
spouses their food and traveling allowances aforestated but not the twelve (12)
cavans per harvest which he reduced to two (2) cavans per harvest. Francisco Borja
also stopped giving the Ballad spouses their allowances. For twenty-seven (27) years
that the Ballad spouses were in the employ of the Borjas they were purportedly not
paid holiday pay, overtime pay, incentive leave pay, premiums and restday pay, 13th
ST. MARTIN FUNERAL HOME, vs. NATIONAL LABOR RELATIONS
month pay, aside from the underpayment of their basic salary.
COMMISSION and BIENVENIDO ARICAYOS,
In June 1999, the Ballad spouses alleged that Francisco Borja unceremoniously
FACTS:
dismissed them and caused this dismissal to be broadcast over the radio, which
caused the former to suffer shock and physical and mental injuries such as social Private respondent alleges that he started working as Operations Manager of
humiliation, besmirched reputation, wounded feelings, moral anxiety, health petitioner St. Martin Funeral Home on February 6, 1995. However, there was no
deterioration and sleepless nights. contract of employment executed between him and petitioner nor was his name
included in the semi-monthly payroll. On January 22, 1996, he was dismissed from
The Court of Appeals observed that petitioners were able to post a bond only on 17
his employment for allegedly misappropriating P38,000.00. Petitioner on the other
December 1999 in the amount of Forty Thousand Pesos (P40,000.00) when the same
hand claims that private respondent was not its employee but only the uncle of
should have been done during the same period of appeal. As this was not done and
Amelita Malabed, the owner of petitioner St.Martin’s Funeral Home and in January
as no justifiable reason was given for the late filing, the Court of Appeals ruled that
1996, the mother of Amelita passed away, so the latter took over the management of
the decision of the Labor Arbiter had become final and executory.
the business.
ISSUE: Whether the appeal is perfected
Amelita made some changes in the business operation and private respondent and
his wife were no longer allowed to participate in the management thereof. As a
consequence, the latter filed a complaint charging that petitioner had illegally
terminated his employment. The labor arbiter rendered a decision in favor of
petitioner declaring that no employer-employee relationship existed between the
parties and therefore his office had no jurisdiction over the case.

ISSUE: WON the decision of the NLRC are appealable to the Court of Appeals.

RULING: The Court is of the considered opinion that ever since appeals from the
NLRC to the SC were eliminated, the legislative intendment was that the special
civil action for certiorari was and still is the proper vehicle for judicial review of
decisions of the NLRC. The use of the word appeal in relation thereto and in the
instances we have noted could have been a lapsus plumae because appeals by
certiorari and the original action for certiorari are both modes of judicial review
addressed to the appellate courts. The important distinction between them, however,
and with which the Court is particularly concerned here is that the special civil
action for certiorari is within the concurrent original jurisdiction of this Court and
the Court of Appeals; whereas to indulge in the assumption that appeals by certiorari
to the SC are allowed would not subserve, but would subvert, the intention of the
Congress as expressed in the sponsorship speech on Senate Bill No. 1495.

Therefore, all references in the amended Section 9 of B.P No. 129 to supposed
appeals from the NLRC to the Supreme Court are interpreted and hereby declared to
mean and refer to petitions for certiorari under Rule65. Consequently, all such
petitions should henceforth be initially filed in the Court of Appeals in strict
observance of the doctrine on the hierarchy of courts as the appropriate forum for
the relief desired.
Yupangco Cotton Mills, Inc. vs. CA (2002)

Facts:

Petitioner contended that a sheriff of the NLRC “erroneously and unlawfully levied”
certain properties which it claims as its own. It filed a 3rdparty claim with the Labor
Arbiter and recovery of property and damageswith the RTC. The RTC dismissed the
case. In the CA, the court dismissed the petition on the ground of forumshopping
and that the proper remedy was appeal in duecourse, not certiorari or mandamus.
Petitioner filed aMFR and argued that the filing of a complaint for

accionreinvindicatoria with the RTC was proper because it is a remedy specifically

granted to an owner (whose properties were subjected to a writ of execution to
enforce a decision rendered in a labor dispute in which itwas not a party). The MFR
was denied. Hence, petitionerfiled this appeal.

Issue:

Whether the CA has jurisdiction over the case

Held:YES

A third party whose property has been levied upon by asheriff to enforce a decision
against a judgment debtor isafforded with several alternative remedies to protect
itsinterests. The third party may avail himself of alternativeremedies cumulatively,
and one will not preclude thethird party from availing himself of the other
alternativeremedies in the event he failed in the remedy firstavailed of.Thus, a third
party may avail himself of the followingalternative remedies:a) File a third party
claim with the sheriff of theLabor Arbiter, andb) If the third party claim is denied,
the third partymay appeal the denial to the NLRC.Even if a third party claim was
denied, a third partymay still file a proper action with a competent courtto recover
ownership of the property illegally seizedby the sheriff.The filing of a third party
claim with the Labor Arbiterand the NLRC did not preclude the petitioner from
filing asubsequent action for recovery of property and damageswith the Regional
Trial Court. And, the institution of suchcomplaint will not make petitioner guilty of
forumshopping.
DOROTEA TANONGON, vs. FELICIDAD SAMSON,
CASINO OSIN, ALBERTO BERBES and LUISITO
VENUS,
FACTS: Felicidad Samson, Casiano A. Osin, Alberto
Belbes and Luisito Venus were employees of CAYCO Marine
Service,which is engaged in the business of hauling oil, owned
and operated by Iluminada Cayco OLIZEN. They filed
acomplaint against CAYCO and OLIZON for illegal dismissal,
underpayment of wages, non-payment of holiday pay,rest day
pay and leave pay.
The labor arbiter dismissed the complaint for lack of merit, but
was reversed by the NLRC on appeal. CAYCO andOLIZON
sought reconsideration of the NLRC’s decision but it was
denied. Likewise, on appeal to the SupremeCourt through a
petition for certiorari was likewise denied for failure to
establish grave abuse of discretion on the part of NLRC. The
decision of the NLRC became final and executory on April 29,
1997. A writ of execution wasissued directing the NLRC
sheriff to collect from CAYCO and OLIZON the
amount computed by the NLRCResearch and Investigation
Unit to be awarded to the complainants. A notice of levy/sale
on execution of personal property was issued and thereafter, on
August 8, 1997 the motor tanker of CAYCO and OLIZEN was
seized to besold at public auction.However, Dorotea
TANONGON filed a
third-party claim
before the labor arbiter alleging that she was the owner of the
subject motor tanker for having acquired the same
from OLIZEN on July 29, 1997 for a consideration
of 1,100,000. The labor arbiter dismissed such claim for lack
of merit. It was found that the Deed of Absolute Sale
wasexecuted on July 29, after the decision became final and
executor on April 29. The sale had been entered into todefraud
them.
Issue:
Whether or not the CA acted with grave abuse of discretion
amounting to lack or in excess of jurisdiction indeciding against
TANONGAN
Ruling:
The NLRC ruled that the subject tanker could not be levied
upon and sold on execution for two reasons: (1) the sheriff was
acting outside his authority when he levied on properties that
were not unquestionably owned by the judgment debtor; and (2)
the sale of the tanker appeared to have been made to defraud
creditors and, therefore, judicial rescission was required.
The CA held, in overruling the NLRC, that the Commission
possessed, under Article 224 (a and b),[16] powers necessary to
implement and enforce the latters final judgments, decisions,
orders and awards. The appellate court ruled further that the
disputed contract was not merely rescissible; it was simulated or
fictitious and, thus, void ab initio.
We agree with the Court of Appeals. A third-party claim on
a levied property does not automatically prevent
execution. Under Rule 39 of the Revised Rules of Court,
execution is a remedy afforded by law for the enforcement of a
judgment, its object being to obtain satisfaction of the decision
on which the writ is issued.[17] In executing a money judgment
against the property of the obligor, the sheriff shall levy on all
properties belonging to the judgment debtor as is amply
sufficient to satisfy the decision and the costs; and shall sell the
same, paying to the judgment creditor as much of the proceeds
as will satisfy the amount of the debt and costs.[18] Sheriffs who
levy upon properties other than those of the judgment debtors d affirmed the Labor Arbiter’s order of reinstatement, but
are acting beyond the limits of their authority.[19] withou
t backwages. The NLRCfurther directed petitioner to pay de Jesus her
back salaries from the date she filed her motion forexecution up to the date
PIONEER TEXTURIZING CORP. and/or JULIANO
of the promulgation of the decision. Petitioners filed their partial motion
LIM,
forreconsideration which the NLRC denied, hence this petition
, vs.
.ISSUE: Whether or not an order for reinstatement needs a writ
NATIONAL LABORRELATIONS COMMISSION,
of execution?
PIONEER TEXTURIZING WORKERS UNIONand
HELD:No. The provision of Article 223 is clear that an award
LOURDES A. DE JESUS,
for reinstatement shall be immediatelyexecutory even pending
.
appeal and the posting of a bond by the employer shall not stay
FACTS:De Jesus is petitioners’
the execution forreinstatement. To require the application for and
reviser/trimmer who based her assigned work on a paper note posted
issuance of a writ of execution as prerequisites for theexecution of a
bypetitioners. The posted paper is identified by its P.O. Number. De Jesus
reinstatement award would certainly betray and run counter to
worked on P.O. No. 3853 by trimming the cloths’ ribs and
the very object and intent of Article 223, i. e., the immediate
thereafter submitted tickets corresponding to the work
execution of a reinstatement order. The reason is simple. An
done to hersupervisor. Three days later, de Jesus received a
applicationfor a writ of execution and its issuance could be
memorandum requiring her to explain why nodisciplinary action
delayed for numerous reasons. A mere
should be taken against her for dishonesty and tampering of official records
continuance orpostponement of a scheduled hearing, for
anddocuments with the intention of cheating as P.O. No. 3853
instance, or an inaction on the part of the Labor Arbiter or
allegedly required no trimming. Thememorandum also placed
theNLRC could easily delay the issuance of the writ thereby setting at
her under preventive suspension for thirty days. In her
naught the strict mandate and noblepurpose envisioned by Article
explanation, de Jesusmaintained that she merely committed a mistake
223. On appeal, however, the appellate tribunal concerned may
in trimming P.O. No. 3853 and admitted that she mayhave been
enjoin orsuspend the reinstatement order in the exercise of its
negligent, but not for dishonesty or tampering. Nonetheless,
sound discretion.Furthermore, the rule is that all doubts in the
she was terminated fromemployment.De Jesus filed a complaint
interpretation and implementation of labor lawsshould be resolved in favor
for illegal dismissal against petitioners. The Labor Arbiter heldpetitioners
of labor. In ruling that an order or award for reinstatement does not require
guilty of illegal dismissal and were ordered to reinstate de
a writ of execution the Court is simply adhering and giving
Jesus to her previous position without loss of seniority rights
meaning to this rule. Henceforth, we rule that anaward or order
and with full backwages from the time of her suspension. On
for reinstatement is self-executory. After receipt of the decision
appeal, theNational Labor Relations Commission (NLRC) declared that
or resolution ordering theemployee's reinstatement, the employer has
the status
the right to choose whether to re-admit the employee to workunder the
quo between them should bemaintained an
same terms and conditions prevailing prior to his dismissal or
to reinstate the employee in thepayroll. In either instance, the
employer has to inform the
employee of his choice. The notification
is based on practical considerations for without
notice, the employee has no way of knowing if he has toreport
for work or not.
Wilhelmina Orozco vs Court of Appeals
Facts:
Wilhelmina Orozco was hired as a writer by the Philippine
Daily Inquirer (PDI) in 1990. She was the columnist of
“Feminist Reflections” under the Lifestyle section of the
publication. She writes on a weekly basis and on a per article
basis (P250-300/article).
In 1991, Magsanoc as the editor-in-chief sought to improve
the Lifestyle section of the paper. She said there were too
many Lifestyle writers and that it was time to reduce the
number of writers. Orozco’s column was eventually dropped.
Orozco filed for a case for Illegal Dismissal against PDI and
Magsanoc. Orozco won in the Labor Arbiter. The LA ruled
that there exists an employer-employee relationship between
PDI and Orozco hence Orozco is entitled to receive
backwages, reinstatement, and 13th month pay.
PDI appealed to the National Labor Relations Commission.
The NLRC denied the appeal because of the failure of PDI to
post a surety bond as required by Article 223 of the Labor
Code. The Court of Appeals reversed the NLRC.
ISSUE: Whether or not there exists an employer-employee
relationship between PDI and Orozco. Whether or not PDI’s
appeal will prosper.
HELD: Under Article 223 of the Labor Code:
ART. 223. Appeal. – Decisions, awards or orders of the
Labor Arbiter are final and executory unless appealed to the
Commission by any or both parties within ten (10) calendar
days from receipt of such decisions, awards, or orders.
In case of a judgment involving a monetary award, an appeal
by the employer 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.
The requirement that the employer post a cash or surety
bond to perfect its/his appeal is apparently intended to assure
the workers that if they prevail in the case, they will receive
the money judgment in their favor upon the dismissal of the
employer’s appeal. It was intended to discourage employers
from using an appeal to delay, or even evade, their obligation
to satisfy their employees’ just and lawful claims.
But in this case, this principle is relaxed by the Supreme
Court considering the fact that the Labor Arbiter, in ruling that
the Orozco is entitled to backwages, did not provide any
computation.
The case is then remanded to the Labor Arbiter for the
computation. This necessarily pended the resolution of the
other issue of whether or not there exists an employer-
employee relationship between PDI and Orozco.
PROGRESSIVE DEVELOPMENT CORPORATION-PIZZA HUT, , vs. HON.
BIENVENIDO LAGUESMA, , and NAGKAKAISANG LAKAS NG
MANGGAGAWA (NLM)-KATIPUNAN,
FACTS:
On July 9, 1993, Nagkakaisang Lakas ng Manggagawa (NLM)-Katipunan
(respondent Union) filed a petition for certification election with the Department of
Labor (National Capital Region) in behalf of the rank and file employees of the
Progressive Development Corporation (Pizza Hut)
On August 30, 1993, petitioner filed a Petition seeking the cancellation of the
Union’s registration on the grounds of fraud and falsification, docketed as BIR Case
No. 8-21-83. Motion was likewise filed by petitioner with the Med-Arbiter
requesting suspension of proceedings in the certification election case until after the
prejudicial question of the Union’s legal personality is determined in the
proceedings for cancellation of registration.
However, in an Order dated September29, 1993,6Med-Arbiter Rasidali C. Abdullah
directed the holding of a certification election among petitioner’s rank and file
employees.
appeal to the office of the Secretary of Labor, Labor Undersecretary Bienvenido E.
Laguesma in a Resolution dated December 29, 1993 denied the same.
A more than cursory reading of the aforecited provisions clearly indicates that the
requirements embodied therein are intended as preventive measures against the
commission of fraud. After a labor organization has filed the necessary papers and
documents for registration, it becomes mandatory for the Bureau of Labor Relations
to check if the requirements under Article 234 have been sedulously complied with.
falsification and seriousirregularities, especially those appearing on the face of the
application and the supporting documents, a labor organization should be denied
recognition as a legitimate labor organization. And if a certificate of recognition has
been issued, the propriety of the labor organization’s registration could be assailed
directly through cancellation of registration proceedings in accordance with Articles
238 and 239 of the Labor Code, or indirectly, by challenging its petition for the
issuance of an order for certification election.
Once a labor organization attains the status of a legitimate labor organization it
begins to possess all of the rights and privileges granted by law to such
organizations.
Inasmuch as the legal personality of respondent Union had been seriously
challenged, it would have been more prudent for the Med-Arbiter and public
respondent to have granted petitioner’s request for the suspension of proceedings in
the certification election case, until the issue of the legality of the Union’s
registration shall have been resolved. Failure ofthe Med-Arbiter and public
respondent to heed the request constituted a grave abuse of discretion.

motion for reconsideration of the public respondent’s resolution was denied.

ISSUE1: whether or not, after the necessary papers and documents have been filed
by a labor organization, recognition by the Bureau of Labor Relations merely
becomes a ministerial function.

RULING1: Art. 234. Requirements of registration. —Any applicant labor

organization, association or group of unions or workers shall acquire legal
personality and shall be entitled to the rights and privileges granted by law to
legitimate labor organizations upon issuance of the certificate of registration based
on the following requirements: (a) Fifty pesos (P50.00) registration fee; (b) The
names of its officers, their addresses, the principal address of the labor organization,
the minutes of the organizational meetings and the list of the workers who
participated in such meetings; (c) The names of all its members comprising at least
twenty percent (20%) of all the employees in the bargaining unit where it seeks to
operate; (d) If the applicant union has been in existence for one or more years,
copies of its annual financial reports; and (e) Four (4) copies of the constitution and
by-laws of the applicant union, minutes of its adoption or ratification, and the list of
the memberswho participated in it.
Takata Corp/ vs. bureau of labor relations misrepresentation to be a grounds for cancellation under Art 2393, nature must be
grave and compelling enough to vitiate consent of a mojority of union membersNo
FACTS: proof as to the lack of information given to those who signed PKU. No member
came forward to deny their membership in SALAMAT. Signing the SPP show their
Takata Corp filed with DOLE a petition for cancellatiion of Certificate of Union
strengthening of desire to join union.The two repeated names cannot be considered
Registration of SALAMAT (union).They alleged that SALAMAT was guilty of
misrepresentation absent any showing that SALAMAT did so deliberately to
misrepresentation, false statements, and fraud with respect to the number of those
increase union membership.Even if the employees were 470, instead of 396, 117
who participated in their organizational meeting, the adoption and ratification of its
(without two repeated names) is still more than 20%
Constitution and by-laws, and in the election of its officers. DOLE Director Atty.
Ricardo Martinez granted petition for cancellation 68 is less than 20% of 396 hence,
short of union registration requirement

The attendance sheet containing the names and signatures of 68 members

contradicted list of names in the PKU

SPP was not attached to the application for registration; only submitted in the
petition for certification election

Bukluran ng Manggagawang Pilipino (BMP) Paralegal Officer Domingo Mole

filed an appeal on behalf of SALAMAT to BLR. Later, the counsel of SALAMAT
filed own appeal w/ BLR.

Takata opposed on ground of forum shopping.

ISSUES:

WON Salamat committed misprepresentation, false statements, fraud as a ground

for cancelling their registration?

RULING:

It does not appear in Art 2342 (b) that attendees in the organizational meeting must
compirse at least 20% of the bargaining unit

Only in Art 234 (c) that requires the names of all its members comprising at least
twenty percent (20%) of all the employees in the bargaining unit where it seeks to
operate. Clearly, the 20% minimum requirement pertains to the employees’
membership in the union and not to the list of workers who participated in the
organizational meeting.(b) and (c) provide for separate requirements.

Total number of employees was 396: 20% of which is about 79. The 119 member
who signed the PKU sufficiently complied with the 20% requirement.

The 68 members who attended the org meeting was enough to constitute a quorum
to validly ratify their Constitution and its by-laws of the union.For fraud and
Adamson v. CIR

FACTS

-Adamson and Adamson, Inc. filed this petition to set aside the CIR’s ruling that the
Supervisory Union can represent the supervisory employees Even if it is affiliated
with the Federation of Free Workers (FFW) with whom the R&F ee union is also
affiliated

Adamson argues that the said affiliation violates Sec. 3 of the Industrial Peace Act

ISSUE: Correct interpretation of Sec. 3 of Industrial Peace Act or WON a

supervisors’ union may affiliate with a federation with which unions of r&f ee of the
same er are also affiliated

Ruling:

-it is a recognized rule that the right of supervisory ee to organize under the IPA
carries restrictions BUT the right itself may not by denied or unduly abridged. When
local unions affiliate, the locals remain the basic units of association, free to serve
their own and common interests subj to restraints imposed by const and by laws

-Hence, notwithstanding affi, local union remain free to serve common interests of
membersThe Adamson and Adamson Supervisory Union and the Adamson and
Adamson, Inc., Salesmen Association (FFW), have their own respective
constitutions and by-laws. They are separately and independently registered of each
other. Both sent their separate proposals for collective bargaining agreements with
their employer. There could be no employer influence on rank-and-file
organizational activities nor could there be any rank and file influence on the
supervisory function of the supervisors because of the representation sought to be
proscribed.

-The confusion seems to have stemmed from the suffix of FFW after the name of the
local unions in the registration of both. Nonetheless, the inclusion of FFW in the
registration is merely to stress that they are its affiliates at the time of registrations. It
does not mean that said local unions cannot stand on their own neither can it be
construed that their personalities are so merged with the mother federation that for
one difference or another they cannot pursue their own ways, independently of the
federation. This is borne by the fact that FFW, like other federation is a legitimate
labor organization separate and distinct from its locals and affiliates.
TROPICAL HUT EMPLOYEES’ UNION-CGW vs. TROPICAL HUT FOOD without previous hearing and at the instance of NATU, this federation should be
MARKET, INC. G.R. No. L-43495-99, 20 January 1990 held liable to the petitioners for the payment of their backwages, as what We have
ruled in the Liberty Cotton Mills Case.
FACTS:

The rank and file workers of the Tropical Hut Food Market Incorporated organized a
local union called the Tropical Hut Employees Union, known for short as the THEU,
elected their officers, adopted their constitution and by-laws and immediately sought
affiliation with the National Association of Trade Unions (NATU). The NATU
accepted the THEU application for affiliation. Following such affiliation with
NATU, Registration Certificate was issued by the Department of Labor in the name
of the Tropical Hut Employees Union — NATU. It appears, however, that NATU
itself as a labor federation, was not registered with the Department of Labor.

Company and THEU-NATU entered into a new Collective Bargaining which

incorporated the previous union-shop security clause and the attached check-off
authorization form. NATU received a letter jointly signed by the incumbent officers
of the local union informing the NATU that THEU was disaffiliating from the
NATU federation. On despite being given the chance to affirm their membership
with THEU-NATU, they did not. The union security clause set forth in the CBA
was enforced which says membership is a condition of continued employment. And
they were dismissed.

ISSUE:

Whether or not disaffiliation is a violation of union security clause and be the basis
of the dismissal of the employees.

HELD:

No. The union security clause embodied in the Collective Bargaining Agreement
cannot be used to justify the dismissals meted to petitioners since it is not applicable
to the circumstances obtaining in this case. The CBA imposes dismissal only in case
an employee is expelled from the union for joining another federation or for forming
another union or who fails or refuses to maintain membership therein. The case at
bar does not involve the withdrawal of merely some employees from the union but
of the whole THEU itself from its federation. Clearly, since there is no violation of
the union security provision in the CBA, there was no sufficient ground to terminate
the employment of said employees.

In view of the fact that the dispute revolved around the mother federation and its
local, with the company suspending and dismissing the workers at the instance of
the mother federation then, the company’s liability should be limited to the
immediate reinstatement of the workers. And since their dismissals were effected
LIBERTY COTTON MILLS WORKERS UNION, vs. Liberty Cotton Mills Inc. should be equally liable with
LIBERTYCOTTON MILLS, INC., PHILIPPINE PAFLUfor the payment of backwagesHeld: YesRatio:
ASSOCIATION OF FREE LABOR UNION (PAFLU), Respondent company is equally liable for the payment of
backwages for having acted in bad faithin effecting the
dismissal of the individual petitioners. Bad faith on the part of
the respondent companymay be gleaned from the fact that the
Facts: On May 17, 1964, thirty-two (32) out of the thirty-six
petitioner workers were dismissed hastily and summarily. At
(36) members of the local union, LibertyCotton Mills Union,
best, itwas guilty of a tortious act, for which it must assume
disaffiliated themselves from respondent PAFLU in accordance
solidary liability, since it apparently chose tosummarily dismiss
with Article X, onUnion Affiliation, of the local union's
the workers at the union's instance secure in the union's
Constitution and By-Laws.
contractual undertaking thatthe union would hold it "free from
any liability" arising from such dismissal.
Respondent PAFLU received the resolution of disaffiliation on
May 25, 1964 and immediately informedthe respondent
company on May 27, 1964 that the disaffiliation was null and
void and that it is taking overthe administration of the local
union in dealing with the management. Two days later, on May
29, 1964,PAFLU advised the company that the petitioner
workers, who were among those who signed thedisaffiliation
resolution, were expelled from their union membership in the
mother federation because theywere found guilty of acts
unbecoming of officers and members of the union and
disloyalty to the motherfederation for instigating union
disaffiliation, and at the same time requested for their
dismissal. On May30, 1964, the company terminated the
employment of the petitioner workers pursuant to the
Maintenanceof Membership provision of the Collective
Bargaining Agreement.In the 1975 case, the Court's decision,
among others, limited the liability of the respondent
company(Liberty Cotton Mills Inc.) to the immediate
reinstatement of the workers (petitioners herein) and
directedrespondent PAFLU to pay the petitioner workers the
equivalent of three (3) years backwages withoutdeduction or
qualification.Issue: Whether or not respondent company
NTERNATIONAL CATHOLIC MIGRATION
COMMISSION vs CALLEJA
FACTS: ICMC was one of those accredited by the
Philippine Government to operate the refugee
processing center in Morong, Bataan. It was
incorporated in New York, USA, at the request of the
Holy See, as a non-profit agency involved in
international humanitarian and voluntary work.
IRRI on the other hand was intended to be an
autonomous, philanthropic, tax-free, non-profit, non-
stock organization designed to carry out the principal
objective of conducting “basic research on the rice
plant, on all phases of rice production, management,
distribution and utilization with a view to attaining
nutritive and economic advantage or benefit for the
people of Asia and other major rice-growing areas
through improvement in quality and quantity of rice.”
The labor organizations in each of the above mentioned
agencies filed a petition for certification election, which
was opposed by both, invoking diplomatic immunity.
ISSUE: Are the claim of immunity by the ICMC and
the IRRI from the application of Philippine labor laws
valid?
HELD: YES
There are basically three propositions underlying the
grant of international immunities to international
organizations. These principles, contained in the ILO
Memorandum are stated thus:
1) international institutions should have a status which
protects them against control or interference by any one
government in the performance of functions for the
effective discharge of which they are responsible to
democratically constituted international bodies in which
all the nations concerned are represented;
2) no country should derive any national financial
advantage by levying fiscal charges on common
international funds; and
3) the international organization should, as a collectivity
of States members, be accorded the facilities for the
conduct of its official business customarily extended to
each other by its individual member States.
The theory behind all three propositions is said to be
essentially institutional in character. “It is not concerned
with the status, dignity or privileges of individuals, but
with the elements of functional independence necessary
to free international institutions from national control
and to enable them to discharge their responsibilities
impartially on behalf of all their members. The raison
d’etre for these immunities is the assurance of
unimpeded performance of their functions by the
agencies concerned
Benjamin Victoriano vs Elizalde Rope Workers’ Union a union includes the right not to join a union. The law is not
unconstitutional. It recognizes both the rights of unions and
employers to enforce terms of contracts and at the same time
Facts: it recognizes the workers’ right to join or not to join union. RA
3550 recognizes as well the primacy of a constitutional right
Benjamin Victoriano, an Iglesia ni Cristo (INC) member, has over a contractual right.
been an employee of the Elizalde Rope Factory (ERF) since
1958. He was also a member of the EPWU (Elizalde Rope
Workers’ Union). Under the collective bargaining agreement
(CBA) between ERF and EPWU, a close shop agreement is
being enforced which means that employment in the factory
relies on the membership in the EPWU; that in order to retain
employment in the said factory one must be a member of the
said Union. In 1962, Victoriano tendered his resignation from
EPWU claiming that as per RA 3350 he is an exemption to
the close shop agreement by virtue of his being a member of
the INC because apparently in the INC, one is forbidden from
being a member of any labor union. It was only in 1974 that
his resignation from the Union was acted upon by EPWU
which notified ERF about it. ERF then moved to terminate
Victoriano due to his non-membership from the EPWU.
EPWU and ERF reiterated that he is not exempt from the
close shop agreement because RA 3350, which provides that
close shop agreements shall not cover members of any
religious sects which prohibit affiliation of their members in
any such labor organization, is unconstitutional and that said
law violates the EPWU’s and ERF’s legal/contractual rights.
ISSUE: Whether or not RA 3350 is unconstitutional.
HELD: No. The right to religion prevails over contractual or
legal rights. As such, an INC member may refuse to join a
labor union and despite the fact that there is a close shop
agreement in the factory where he was employed, his
employment could not be validly terminated for his non-
membership in the majority therein. Further, the right to join

KAPATIRAN VS. CALLEJA
FACTS:
1984-1987: TUPAS (Kapatiran) was the sole and exclusive collective
bargaining representative of the workers in the Meat and Canning
Division of the Universal Robina Corp, with a 3-yr collective bargaining
agreement which was to expire on November 15, 1987
Within the freedom period of 60 days prior to the expiration of its CBA,
TUPAS filed an amended notice of strike as a means of pressuring the
company to extend, renew, or negotiate a new CBA with it
The NEW ULO (composed mostly of workers belonging to the INC sect)
registered as a labor union
TUPAS staged a strike
RULING:
1. YES, because This Court's decision in Victoriano vs. Elizalde Rope
Workers' Union, upholding the right of members of the IGLESIA NI
KRISTO sect not to join a labor union for being contrary to their
religious beliefs, does not bar the members of that sect from forming
their own union. The public respondent correctly observed that the
"recognition of the tenets of the sect ... should not infringe on the basic
right of self-organization granted by the constitution to workers,
regardless of religious affiliation."
Upholding the right of members of the IGLESIA NI KRISTO sect not
to join a labor union for being contrary to their religious beliefs, does
not bar the members of that sect from forming their own union. The
"recognition of the tenets of the sect ... should not infringe on the basic
right of self-organization granted by the constitution to workers,
regardless of religious affiliation."

ROBINA obtained obtained an injunction against the strike, resulting in an A "certification election is the best forum in ascertaining the majority
agreement to return to work and for the parties to negotiate a new CBA status of the contending unions wherein the workers themselves can
freely choose their bargaining representative thru secret ballot."
The NEW ULO filed a petition for a certification election at the BLR

TUPAS moved to dismiss the petition

 for being defective in form and

 the members of the NEW ULO were mostly members of INC sect which
3 yrs previous refused to affiliate with any labor union

 accused company of using the NEW ULO to defeat TUPAS’ bargaining

rights

Med-Arbiter ordered the holding of a certification election with 20 days

ISSUES:

1. Whether or not the formation of NEW ULO as a labor union was

proper
PABLO ARIZALA, SERGIO MARIBAO, LEONARDO
JOVEN, and FELINO BULANDUS,
vs.
THE COURT OF APPEALS and THE PEOPLE OF THE
PHILIPPINES,
Facts:
It was under the regime of said Industrial Peace Act that the
Government Service Insurance System (GSIS, for short)
became bound by a collective bargaining agreement executed
between it and the labor organization representing the majority
of its employees, the GSIS Employees Association. The
agreement contained a "maintenance-of-membership"
clause, 5 There appears to be no dispute that at that time, the
petitioners occupied supervisory positions in the GSIS. Pablo
Arizala and Sergio Maribao were, respectively, the Chief of the
Accounting Division, and the Chief of the Billing Section of said
Division, in the Central Visayas Regional Office of the GSIS.
Leonardo Joven and Felino Bulandus were, respectively, the
Assistant Chief of the Accounting Division (sometimes Acting
Chief in the absence of the Chief) and the Assistant Chief of
the Field Service and Non-Life Insurance Division (and Acting
Division Chief in the absence of the Chief), of the same
Central Visayas Regional Office of the GSIS. Demands were
made on all four of them to resign from the GSIS Employees
Association, in view of their supervisory positions. They
refused to do so. Consequently, two (2) criminal cases for
violation of the Industrial Peace Act were lodged against them
in the City Court of Cebu: one involving Arizala and
Maribao 6 and the other, Joven and Bulandus
Issue:
whether or not the petitioners' criminal liability for a violation of
the Industrial Peace Act may be deemed to have been
obliterated in virtue of subsequent legislation and the
provisions of the 1973 and 1987 Constitutions.
Ruling:
In other words, the right of Government employees to deal and
negotiate with their respective employers is not quite as
extensive as that of private employees. Excluded from
negotiation by government employees are the "terms and
conditions of employment ... that are fixed by law," it being
only those terms and conditions not otherwise fixed by law that
"may be subject of negotiation between the duly recognized
employees' organizations and appropriate government
authorities," 39 And while EO No. 180 concedes to government
employees, like their counterparts in the private sector, the
right to engage in concerted activities, including the right to
strike, the executive order is quick to add that those activities
must be exercised in accordance with law, i.e. are subject both
to "Civil Service Law and rules" and "any legislation that may
be enacted by Congress," 40 that "the resolution of complaints,
grievances and cases involving government employees" is not
ordinarily left to collective bargaining or other related
concerted activities, but to "Civil Service Law and labor laws
and procedures whenever applicable;" and that in case "any
dispute remains unresolved after exhausting all available
remedies under existing laws and procedures, the parties may
jointly refer the dispute to the (Public Sector Labor-
Management) Council for appropriate action."41 What is more,
the Rules and Regulations implementing Executive Order No.
180 explicitly provide that since the "terms and conditions of
employment in the government, including any political
subdivision or instrumentality thereof and government-owned
and controlled corporations with original charters are governed
by law, the employees therein shall not strike for the purpose
of securing changes thereof. 42
On the matter of limitations on membership in labor unions of
government employees, Executive Order No. 180 declares
that "high level employees whose functions are normally
considered as policy making or managerial, or whose duties
are of a highly confidential nature shall not be eligible to join
the organization of rank-and-file government employees. 43 A
"high level employee" is one "whose functions are normally
considered policy determining, managerial or one whose
duties are highly confidential in nature. A managerial function
refers to the exercise of powers such as: 1. To effectively
recommend such managerial actions; 2. To formulate or
execute management policies and decisions; or 3. To hire,
transfer, suspend, lay off, recall, dismiss, assign or discipline
employees. 44
UNITED PEPSI-COLA SUPERVISORY
UNION (UPSU),
vs.
HON. BIENVENIDO E. LAGUESMA and
PEPSI-COLA PRODUCTS, PHILIPPINES,
INC.
FACTS: Petitioner is a union of supervisory employees.
It appears that on March 20, 1995 the union filed a
petition for certification election on behalf of the route
managers at Pepsi-Cola Products Philippines, Inc.
However, its petition was denied by the med-arbiter
and, on appeal, by the Secretary of Labor and
Employment, on the ground that the route managers are
managerial employees and, therefore, ineligible for
union membership under the first sentence of Art. 245
of the Labor Code, which provides:
Ineligibility of managerial employees to join any labor
organization; right of supervisory employees. —
Managerial employees are not eligible to join, assist or
form any labor organization. Supervisory employees
shall not be eligible for membership in a labor
organization of the rank-and-file employees but may
join, assist or form separate labor organizations of their
own.
Hence, this petition. Pressing for resolution its
contention that the first sentence of Art. 245 of the
Labor Code, so far as it declares managerial employees
to be ineligible to form, assist or join unions,
contravenes Art. III, §8 of the Constitution which
provides:
The right of the people, including those employed in the
public and private sectors, to form unions, associations,
or societies for purposes not contrary to law shall not be
abridged.
ISSUES:
(1) whether the route managers at Pepsi-Cola Products
Philippines, Inc. are managerial employees and
(2) whether Art. 245, insofar as it prohibits managerial
employees from forming, joining or assisting labor
unions, violates Art. III, §8 of the Constitution.
HELD: YES and NO
As a class, managers constitute three levels of a
pyramid: (1) Top management; (2) Middle
Management; and (3) First-line Management [also
called supervisors]..
A distinction exists between those who have the
authority to devise, implement and control strategic and
operational policies (top and middle managers) and
those whose task is simply to ensure that such policies
are carried out by the rank-and-file employees of an
organization (first-level managers/supervisors). What
distinguishes them from the rank-and-file employees is
that they act in the interest of the employer in
supervising such rank-and-file employees.
“Managerial employees” may therefore be said to fall
into two distinct categories: the “managers” per se, who
compose the former group described above, and the
“supervisors” who form the latter group.
Distinction is evident in the work of the route managers
which sets them apart from supervisors in general.
Unlike supervisors who basically merely direct
operating employees in line with set tasks assigned to
them, route managers are responsible for the success of
the company’s main line of business through
management of their respective sales teams. Such
management necessarily involves the planning,
direction, operation and evaluation of their individual
teams and areas which the work of supervisors does not
entail.
The route managers cannot thus possibly be classified as
mere supervisors because their work does not only
involve, but goes far beyond, the simple direction or
supervision of operating employees to accomplish
objectives set by those above them.
While route managers do not appear to have the power
to hire and fire people (the evidence shows that they
only “recommended” or “endorsed” the taking of
disciplinary action against certain employees), this is
because thisis a function of the Human Resources or
Personnel Department of the company.
# 2: Constitutionality of Art. 245
Art.245 is the result of the amendment of the Labor
Code in 1989 by R.A. No. 6715, otherwise known as the
Herrera-Veloso Law. Unlike the Industrial Peace Act or
the provisions of the Labor Code which it superseded,
R.A. No. 6715 provides separate definitions of the terms
“managerial” and “supervisory employees,” as follows:
Art. 212. Definitions. . . .
(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. All employees not falling within
any of the above definitions are considered rank-and-file
employees for purposes of this Book.
The distinction between top and middle managers, who
set management policy, and front-line supervisors, who
are merely responsible for ensuring that such policies
are carried out by the rank and file, is articulated in the
present definition. 30 When read in relation to this
definition in Art. 212(m), it will be seen that Art. 245
faithfully carries out the intent of the Constitutional
Commission in framing Art. III, §8 of the fundamental
law.
*Framer’s Intent: MR. LERUM. My amendment is on
Section 7, page 2, line 19, which is to insert between the
words “people” and “to” the following: WHETHER
EMPLOYED BY THE STATE OR PRIVATE
ESTABLISHMENTS. In other words, the section will
now read as follows: “The right of the people
WHETHER EMPLOYED BY THE STATE OR
PRIVATE ESTABLISHMENTS to form associations,
unions, or societies for purposes not contrary to law
shall not be abridged.”

Nor is the guarantee of organizational right in Art. III,

§8 infringed by a ban against managerial employees
forming a union. The right guaranteed in Art. III, §8 is
subject to the condition that its exercise should be for
purposes “not contrary to law.” In the case of Art. 245,
there is a rational basis for prohibiting managerial
employees from forming or joining labor organizations.

Philips Industrial Development, Inc. vs NLRC
Facts:-
PIDI is a domestic corporation engaged in the manufacturing
and marketing of electronic products.Since 1971, it had a total
of 6 collective bargaining agreements with private respondent
PhilipsEmployees Organization-FFW (PEO-FFW), a registered
labor union and the certified bargaining agent of all rank and
file employees of PIDI.- In the first CBA, the supervisors
(referred to in RA 875), confidential employees, security
guards,temporary employees and sales representatives were
excluded in the bargaining unit. In the second to thefifth, the
sales force, confidential employees and heads of small units,
together with the managerialemployees, temporary employees
and security personnel were excluded from the bargaining unit.
Theconfidential employees are the division secretaries of
light/telecom/data and consumer electronics,marketing
managers, secretaries of the corporate planning and business
manager, fiscal and financialsystem manager and audit and
EDP manager, and the staff of both the General Management
and thePersonnel Department.- In the sixth CBA, it was agreed
that the subject of inclusion or exclusion of service engineers,
sales personnel and confidential employees in the coverage of
the bargaining unit would be submitted for arbitration. The
parties failed to agree on a voluntary arbitrator and the Bureau
of Labor Relationsendorsed the petition to the Executive Labor
Arbiter of the NCR for compulsory arbitration.- March 1998,
Labor Arbiter: A referendum will be conducted to determine
the will of the serviceengineers and sales representatives as to
their inclusion or exclusion in the bargaining unit. It was
alsodeclared that the Division Secretaries and all staff of
general management, personnel and industrialrelations
department, secretaries of audit, EDP, financial system
are confidential employees are deemedexcluded in the
bargaining unit.- PEO-FFW appealed to the NLRC; NLRC
declared PIDI's Service Engineers, Sales Force,
divisionsecretaries, all Staff of General Management,
Personnel and Industrial Relations Department, Secretariesof
Audit, EDP and Financial Systems are included within the rank
and file bargaining unit, citing theImplementing Rules of E.O
111 and Article 245 of the Labor Code (all workers, except
managerialemployees and security personnel, are qualified to
join or be a part of the bargaining unit)
Issue:-Whether service engineers, sales representatives and
confidential employees of petitioner are qualified to be part of
the existing bargaining unit-
Held: NLRC decision is set aside while the decision of the
Executive Labor Arbiter is reinstated. Confidentialemployees
are excluded from the bargaining unit while a referendum will
be conducted to determine thewill of the service engineers
and sales representatives as to their inclusion or exclusion from
the bargaining unit, but those who are holding supervisory
positions or functions are ineligible to join a labor organization
of the rank and file employees but may join, assist or form a
separate labor organization of their own.Ratio:The exclusion of
confidential employees:The rationale behind the ineligibility of
managerial employees to form, assist or join a labor union
equally applies to confidential employees. With the presence of
managerial employees in a union,the union can become
company-dominated as their loyalty cannot be assured. In
Golden Farms vs Calleja,the Court states that confidential
employees, who have access to confidential information, may
becomethe source of undue advantage.
Advertisements
 the cultivation of bananas. To be sure, the monthly paid grouphave
GOLDEN FARMS VS SECRETARY OF LABOR even been excluded from the bargaining unit of the daily paid rank
and file employees.In the case of UP vs Ferrer-Calleja, the SC
FACTS:Petitioner Golden Farms, Inc., is a corporation engaged in sanctioned the formation of 2 separatebargaining units within the
the production and marketingof bananas for export. On February establishment. Finally, the SC note that it was Petitioner
27, 1992, private respondent Progressive Federation ofLabor companythat filed the motion to dismiss the petition for election
(PFL) filed a petition before the Med-Arbiter praying for the holding violating the general rule that theemployer has no standing to
of a certificationelection among the monthly paid office and question a certification election since this is the so that theemployer
technical rank-and-file employees of petitionerGolden Farms. has no standing to question a certification election since this is the
Petitioner moved to dismiss claiming that PFL failed to show that it sole concerns ofthe workers (Bystander Rule
organized achapter within the petitioner establishment, that there
was already an existing CBA betweenthe rank and file employees
represented by NFL and petitioner, and that the
employeesrepresented by PFL are disqualified by the courts.PFL
countered that the monthly-paid office workers and technical
employees should beallowed because they were expressly
excluded from the coverage of the CBA betweenPetitioner and
NFL. Petitioner argued that the subject employees shoull have
joined theexisting CBA if they are not managerial employees. On
April 18,1991, the Med-Arbiter orderedthe conduct of the
certification elections. Petitioner appealed to the Secretary of Labor
whichthe LabSec denies the appeal for lack of merit

ISSUE:WON the Monthly Paid rank and file employee can

constitute a bargaining unit separate fromthe existing bargaining
units of its daily-paid rank and file employees

RULING: Wherefore, Petition dismissed for lack of

merit.RATIO:Yes, the Monthly Paid office and technical rank and
file employee of the petitioner enjoyconstitutional rights to self
organization and collective bargaining. The duties of the
monthlypaid employees primarily administrative and clerical which
is of different nature from daily paidemployees whose main work is