Mabeza vs. NLRC [G.R. No.

118506 April 18, 1997]

Post under case digests, labor law at Monday, April 09, 2012 Posted by Schizophrenic
Mind
Facts: Petitioner Norma Mabeza and her co-employees at the HotelSupreme in
Baguio City were asked by the hotels management to sign an instrument attesting to
the latters compliance with minimum wage and other labor standard provision. The
instrument provides that they have no complaints against the management of the Hotel
Supreme as they are paid accordingly and that they are treated well. The petitioner
signed the affidavit but refused to go to the Citys Prosecutors Office to confirm the
veracity and contents of the affidavit as instructed by management. That same day, as
she refused to go to the City Prosecutors Office, she was ordered by the
hotel management to turn over the keys to her living quarters and to remove her
belongings to the hotels premises. She then filed a leave of absence which was denied
by her employer. She attempted to return to work but the hotels cashier told her that
she should not report to work and instead continue with her unofficial leave of absence.
Three days after her attempt to return to work, she filed a complaint against the
management for illegal dismissal before the Arbitration Branch of the NLRC in
Baguio City. In addition to that, she alleged underpayment of wages, non-payment of
holiday pay,service incentive leave pay, 13th month pay, night differential and other
benefits. Peter Ng, in their Answer, argued that her unauthorized leave of absence from
work is the ground for her dismissal. He even maintained that her alleged of
underpayment and non-payment of benefits had no legal basis. He raises a new ground
of loss of confidence, which was supported by his filing ofcriminal case for the alleged
qualified theft of the petitioner. The Labor Arbiter ruled in favor of the hotel management
on the ground of loss of confidence. She appealed to the NLRC which affirmed the
Labor Arbiters decision. hence, this petition.
Issue: Whether or not the dismissal by the private respondent of petitioner constitutes
an unfair labor practice.
Held: The NLRCs decision is reversed. The pivotal question in any case where unfair
labor practice on the part of the employer is alleged is whether or not the employer has
exerted pressure, in the form of restraint, interference or coercion, against his
employees right to institute concerted action for better terms and conditions

ofemployment. Without doubt, the act of compelling employees to sign an instrument

indicating that the employer observed labor standard provisions of the law when he
might not have, together with the act of terminating or coercing those who refuse to
cooperate with the employees scheme constitutes unfair labor practice. The labor
arbiters contention that the reason for the monetary benefits received by the petitioner
between 1981 to 1987 were less than the minimum wage was because petitioner did
not factor in the meals, lodging, electric consumption and water she received during the
period of computations. Granting that meals and lodging were provided and indeed
constituted facilities, such facilities could not be deducted without the employer
complying first with certain legal requirements. Without satisfying these requirements,
the employer simply cannot deduct the value from the employees ages. First, proof
must be shown that such facilities are customarily furnished by the trade. Second, the
provision of deductible facilities must be voluntary accepted in writing by the employee.
Finally, facilities must be charged at fair and reasonable value. These requirements
were not met in the instant case. Private respondent failed to present any company
policy to show that the meal and lodging are part of the salary. He also failed to provide
proof of the employees written authorization and he failed to show how he arrived at the
valuations. More significantly, the food and lodging, or electricity and water consumed
by the petitioner were not facilities but supplements. A benefit or privilege granted to an
employee for the convenience of the employer is not a facility. The criterion in making a
distinction between the two not so much lies in the kind but the purpose. Considering,
therefore, that hotel workers are required to work on different shifts and are expected to
be available at various odd hours, their ready availability is a necessary matter in the
operations of a small hotel, such as the private respondents hotel.
Allied Free Workers Union v. Compaia Maritima
Facts:
MARITIMA is a local corporation engaged in the shipping business. Teves is its
branch manager in the port of Iligan City. And AFWU is a duly registered legitimate
labor organization with 225 members.
On August 11, 1952, MARITIMA, through Teves, entered into a CONTRACT 4 with
AFWU to do and perform all the work of stevedoring and arrastre services of all its
vessels or boats calling in the port of Iligan City, beginning August 12, 1952.

During the first month of the existence of the CONTRACT, AFWU rendered
satisfactory service. So, MARITIMA, through Teves, verbally renewed the same. This
harmonious relations between MARITIMA and AFWU lasted up to the latter part of
1953 when the former complained to the latter of unsatisfactory and inefficient
service by the laborers doing the arrastre and stevedoring work. This deteriorating
situation was admitted as a fact by AFWU's president. To remedy the situationsince
MARITIMA's business was being adversely affected -Teves was forced to hire extra
laborers from among "stand-by" workers not affiliated to any union to help in the
stevedoring and arrastre work. The wages of these extra laborers were paid by
MARITIMA through separate vouchers and not by AFWU. Moreover, said wages were
not charged to the consignees or owners of the cargoes.
On July 23, 1954, AFWU presented to MARITIMA a written proposal5 for a collective
bargaining agreement. This demand embodied certain terms and conditions of
employment different from the provisions of the CONTRACT. No reply was made by
MARITIMA.
AFWU sued MARITIMA for unfair labor practice saying that MARITIMA refused to
bargain collectively. CIR dismissed the case on the ground that it has no jurisdiction
over the case.
Issue:
Whether or not CIR has jurisdiction over the case?
Whether or not MARITIMA can be considered an employer of the members of AFWU?
Held:
No to both.
It is true that MARITIMA admits that it did not answer AFWU's proposal for a
collective bargaining agreement. From this it does not necessarily follow that it is
guilty of unfair labor practice. Under the law the duty to bargain collectively arises
only between the "employer" and its "employees". Where neither party is an
''employer" nor an "employee" of the other, no such duty would exist. Needless to
add, where there is no duty to bargain collectively the refusal to bargain violates no
right.
The court a quo held that under the CONTRACT, AFWU was an independent
contractor of MARITIMA.
Neither is there any direct employment relationship between MARITIMA and the
laborers. The latter have no separate individual contracts with MARITIMA. In fact,
the court a quo found that it was AFWU that hired them. Their only possible
connection with MARITIMA is through AFWU which contracted with the latter. Hence,
they could not possibly be in a better class than AFWU which dealt with MARITIMA.

Kiok Loy v. NLRC 141 SCRA 179 (1986)

Facts:

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

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

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

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

The case was brought to the National Labor Relations Commission (NLRC) for compulsory arbitration pursuant to
Presidential Decree No. 823, as amended. But the Company requested for a lot of postponements. NLRC ruled that
respondent Sweden Ice Cream is guilty of unjustified refusal to bargain, in violation of Section (g) Article 248 (now
Article 249), of P.D. 442, as amended.
Issue: Whether the Company is guilty of unfair labor practice for refusal to bargain
Held: Yes. Petition dismissed for lack of merit.

Collective bargaining is one of the democratic frameworks under the New Labor Code, designed to stabilize the
relation between labor and management and to create a climate of sound and stable industrial peace. It is a
mutual responsibility of the employer and the Union and is characterized as a legal obligation.

Article 249, par. (g) of the Labor Code makes it an unfair labor practice for an employer to refuse "to meet and
convene promptly and expeditiously in good faith for the purpose of negotiating an agreement with respect to
wages, hours of work, and all other terms and conditions of employment including proposals for adjusting any
grievance or question arising under such an agreement and executing a contract incorporating such agreement, if
requested by either party.

The mechanics of collective bargaining are set in motion only when the following jurisdictional preconditions are
present, namely,

o (1) possession of the status of majority representation of the employees' representative in accordance with any of the
means of selection or designation provided for by the Labor Code;
o (2) proof of majority representation; and
o (3) a demand to bargain under Article 251, par. (a) of the New Labor Code.

A Company's refusal to make counter proposal if considered in relation to the entire bargaining process, may indicate
bad faith since the Union's request for a counter proposal is left unanswered. Besides, petitioner Company's
approach and attitude-stalling the negotiation by a series of postponements, non-appearance at the hearing

conducted, and undue delay in submitting its financial statements, lead to no other conclusion except that it is
unwilling to negotiate and reach an agreement with the Union.

Philippine Airlines Inc. vs. NLRC, 201 SCRA 687FACTS

- On March 15, 1985, the Philippine Airlines, Inc. (PAL) completely revised its 1966 Code of Discipline.
TheCode was circulated among the employees and was immediately implemented, and some employees
wereforthwith subjected to the disciplinary measures embodied therein.- PALEA alleged that copies of the
Code had been circulated in limited numbers; that being penal in naturethe Code must conform with the
requirements of sufficient publication, and that the Code was arbitrary,oppressive, and prejudicial to the
rights of the employees. It prayed that implementation of the Code
beh e l d i n a b e y a n c e ; t h a t P A L s h o u l d d i s c u s s t h e s u b s t a n c e o f t h e C o d e w i t h P A
L E A ; t h a t e m p l o y e e s dismissed under the Code be reinstated and their cases subjected
to further hearing; and that PAL be declared guilty of unfair labor practice and be ordered to pay
damages (pp. 7-14, Record.).
HELD
- Indeed, industrial peace cannot be achieved if the employees are denied their just participation in
thediscussion of matters affecting their rights. Thus, even before Article 211 of the Labor Code (P.D. 442)
wasamended by Republic Act No. 6715, it was already declared a policy of the State: "(d)
To promote theenlightenment of workers concerning their rights and obligations . . .as employees." This
was, of course,amplified by Republic Act No. 6715 when it decreed the "participation of workers in
decision and policymaking processes affecting their rights, duties and welfare." PAL's position that it
cannot be saddled withthe "obligation" of sharing management prerogatives as during the formulation of
the Code, Republic ActNo. 6715 had not yet been enacted (Petitioner's Memorandum, p. 44;
Rollo, p. 212), cannot thus
bes u s t a i n e d . W h i l e s u c h " o b l i g a t i o n " w a s n o t y e t f o u n d e d i n l a w
w h e n t h e C o d e w a s f o r m u l a t e d , t h e attainment of a harmonious labor-management
relationship and the then already existing state policy
of e n l i g h t e n i n g w o r k e r s c o n c e r n i n g t h e i r r i g h t s a s e m p l o y e e s d e m a n d n o l e s s t h
a n t h e o b s e r v a n c e o f transparency in managerial moves affecting employees' rights.
2.
Kiok Loy v. NLRC, 141 SCRA 179 (1986)FACTS
- The union gave the employer copies of its proposed CBA and requested the company to make counterproposals. The company did not reply. The union again wrote the company but this was also ignored.
HELD
-It is unfair labor practice for an employer to refuse to meet and convene promptly and expeditiously
ingood faith for the purpose of negotiating an agreement for wages, hours of work and
other terms of e m p l o y m e n t . A c o m p a n y s r e f u s a l t o m a k e c o u n t e r p r o p o s a l i f c o n s i d e r e d i n r e l a t i o n t o t h e e n t i r e bargaining process, may indicate bad
faith and this is especially true where the Unions request for a counter proposal is left
unanswered. We agree with the pronouncement that it is not obligatory upon eitherside of a labor
controversy to precipitately accept or agree to the proposals of the other. But an
erringparty should not be tolerated and allowed with impunity to resort to schemes feigning
negotiations bygoing through empty gestures.

SAN MIGUEL CORPORATION EMPLOYEES UNION-PTGWO vs. HON. MA. NIEVES D.

CONFESOR

G.R. No. 111262

J. KAPUNAN
FACTS:
June 28, 1990, petitioner-union San Miguel Corporation Employees Union PTGWO
entered into a Collective Bargaining Agreement (CBA) with private respondent San Miguel
Corporation (SMC) to take effect upon the expiration of the previous CBA or on June 30,
1989.
Effective October 1, 1991, Magnolia and Feeds and Livestock Division were spun-off and
became two separate and distinct corporations: Magnolia Corporation (Magnolia) and San
Miguel Foods, Inc. (SMFI). Notwithstanding the spin-offs, the CBA remained in force and
effect.
After June 30, 1992, the CBA was renegotiated in accordance with the terms of the CBA
and Article 253-A of the Labor Code. Negotiations started sometime in July, 1992 with the
two parties submitting their respective proposals and counterproposals.
During the negotiations, the petitioner-union insisted that the bargaining unit of SMC should
still include the employees of the spun-off corporations: Magnolia and SMFI; and that the
renegotiated terms of the CBA shall be effective only for the remaining period of two years
or until June 30, 1994.
SMC, on the other hand, contended that the members/employees who had moved to
Magnolia and SMFI, automatically ceased to be part of the bargaining unit at the SMC.
Furthermore, the CBA should be effective for three years in accordance with Art. 253-A of
the Labor Code.
Unable to agree on these issues with respect to the bargaining unit and duration of the
CBA, petitioner-union declared a deadlock on September 29, 1990.
On October 2, 1992, a Notice of Strike was filed against SMC.
In order to avert a strike, SMC requested the National Conciliation and Mediation Board
(NCMB) to conduct preventive mediation. No settlement was arrived at despite several
meetings held between the parties.
On November 3, 1992, a strike vote was conducted which resulted in a yes vote in favor of
a strike.
On November 4, 1992, private respondents SMC, Magnolia and SMFI filed a petition with
the Secretary of Labor praying that the latter assume jurisdiction over the labor dispute in a
vital industry.

Secretary of Labor assumed jurisdiction over the labor dispute. Several conciliation
meetings were held but still no agreement/settlement was arrived at by both parties.
After the parties submitted their respective position papers, the Secretary of Labor issued
the assailed Order on February 15, 1993 directing, among others, that the renegotiated
terms of the CBA shall be effective for the period of three (3) years from June 30, 1992; and
that such CBA shall cover only the employees of SMC and not of Magnolia and SMFI.
TRO was filed and granted.
ISSUES:
1) Whether or not the duration of the renegotiated terms of the CBA is to be effective for
three years of for only two years; and
2) Whether or not the bargaining unit of SMC includes also the employees of the Magnolia
and SMFI.
HELD:
1) This new provision states that the CBA has a term of five (5) years instead of three years,
before the amendment of the law as far as the representation aspect is concerned. All other
provisions of the CBA shall be negotiated not later than three (3) years after its execution.
The representation aspect refers to the identity and majority status of the union that
negotiated the CBA as the exclusive bargaining representative of the appropriate bargaining
unit concerned. All other provisions simply refers to the rest of the CBA, economic as well
as non-economic provisions, except representation.
the law is clear and definite on the duration of the CBA insofar as the representation aspect
is concerned, but is quite ambiguous with the terms of the other provisions of the CBA. It is
a cardinal principle of statutory construction that the Court must ascertain the legislative
intent for the purpose of giving effect to any statute. The history of the times and state of the
things existing when the act was framed or adopted must be followed and the conditions of
the things at the time of the enactment of the law should be considered to determine the
legislative intent.
the legislators were more inclined to have the period of effectivity for three (3) years insofar
as the economic as well as non-economic provisions are concerned, except representation.
Obviously, the framers of the law wanted to maintain industrial peace and stability by having
both management and labor work harmoniously together without any disturbance. Thus, no

outside union can enter the establishment within five (5) years and challenge the status of
the incumbent union as the exclusive bargaining agent. Likewise, the terms and conditions
of employment (economic and non-economic) can not be questioned by the employers or
employees during the period of effectivity of the CBA. The CBA is a contract between the
parties and the parties must respect the terms and conditions of the agreement. Notably,
the framers of the law did not give a fixed term as to the effectivity of the terms and
conditions of employment. It can be gleaned from their discussions that it was left to the
parties to fix the period.
2) the transformation of the companies was a management prerogative and business
judgment which the courts can not look into unless it is contrary to law, public policy or
morals. Neither can we impute any bad faith on the part of SMC so as to justify the
application of the doctrine of piercing the corporate veil. Ever mindful of the employees
interests, management has assured the concerned employees that they will be absorbed by
the new corporations without loss of tenure and retaining their present pay and benefits
according to the existing CBAs. They were advised that upon the expiration of the CBAs,
new agreements will be negotiated between the management of the new corporations and
the bargaining representatives of the employees concerned.
Magnolia and SMFI became distinct entities with separate juridical personalities. Thus, they
can not belong to a single bargaining unit
Moreover, in determining an appropriate bargaining unit, the test of grouping is mutuality or
commonality of interests. The employees sought to be represented by the collective
bargaining agent must have substantial mutual interests in terms of employment and
working conditions as evinced by the type of work they performed. Considering the spinoffs, the companies would consequently have their respective and distinctive concerns in
terms of the nature of work, wages, hours of work and other conditions of employment.
Interests of employees in the different companies perforce differ. SMC is engaged in the
business of the beer manufacturing. Magnolia is involved in the manufacturing and
processing of diary products while SMFI is involved in the production of feeds and the
processing of chicken. The nature of their products and scales of business may require
different skills which must necessarily be commensurated by different compensation
packages. The different companies may have different volumes of work and different
working conditions. For such reason, the employees of the different companies see the
need to group themselves together and organize themselves into distinctive and different

groups. It would then be best to have separate bargaining units for the different companies
where the employees can bargain separately according to their needs and according to their
own working conditions.

GERARDO F. RIVERA et al vs. HON. EDGARDO ESPIRITU

G.R. No. 135547
J. QUISUMBING
FACTS:
On June 5, 1998, PAL pilots affiliated with the Airline Pilots Association of the Philippines
(ALPAP) went on a three-week strike, causing serious losses to the financially beleaguered
flag carrier. As a result, PALs financial situation went from bad to worse. Faced with
bankruptcy, PAL adopted a rehabilitation plan and downsized its labor force by more than
one-third.
On July 22, 1998, PALEA went on strike to protest the retrenchment measures adopted by
the airline, which affected 1,899 union members. The strike ended four days later, when PAL
and PALEA agreed to a more systematic reduction in PALs work force and the payment of
separation benefits to all retrenched employees.
Erap created a stupid task force which was empowered to summon all parties concerned
for conciliation, mediation (for) the purpose of arriving at a total and complete solution of the
problem. Conciliation meetings were then held between PAL management and the three
unions representing the airlines employees, with the Task Force as mediator.

PAL management submitted to the Task Force an offer by private respondent Lucio Tan,
Chairman and Chief Executive Officer of PAL, of a plan to transfer shares of stock to its
employees.
On September 10, 1998, the Board of Directors of PALEA voted to accept Tans offer and
requested the Task Forces assistance in implementing the same. Union members, however,
rejected Tans offer. Under intense pressure from PALEA members, the unions directors
subsequently resolved to reject Tans offer.
On September 17, 1998, PAL informed the Task Force that it was shutting down its
operations effective September 23, 1998, preparatory to liquidating its assets and paying off
its creditors. The airline claimed that given its labor problems, rehabilitation was no longer
feasible, and hence, the airline had no alternative but to close shop.
On September 18, 1998, PALEA sought the intervention of the Office of the President in
immediately convening the parties, the PAL management, PALEA, ALPAP, and FASAP,
including the SEC under the direction of the Inter-Agency Task Force, to prevent the
imminent closure of PAL
On September 19, 1998, PALEA informed the Department of Labor and Employment
(DOLE) that it had no objection to a referendum on the Tans offer. 2,799 out of 6,738
PALEA members cast their votes in the referendum under DOLE supervision held on
September 21-22, 1998. Of the votes cast, 1,055 voted in favor of Tans offer while 1,371
rejected it.
On September 23, 1998, PAL ceased its operations and sent notices of termination to its
employees.
Of the votes cast, 61% were in favor of accepting the PAL-PALEA agreement, while 34%
rejected it. On October 7, 1998, PAL resumed domestic operations. On the same date,
seven officers and members of PALEA filed this instant petition to annul the September 27,
1998 agreement entered into between PAL and PALEA
ISSUE
Whether or not the agreement was not meant merely to suspend the existing PAL-PALEA
CBA, which expires on September 30, 2000, but also to foreclose any renegotiation or any
possibility to forge a new CBA for a decade or up to 2008. It violates the protection to labor
policy

HELD
ART. 253-A. Terms of a Collective Bargaining Agreement. Any Collective Bargaining
Agreement that the parties may enter into shall, insofar as the representation aspect is
concerned, be for a term of five (5) years. No petition questioning the majority status of the
incumbent bargaining agent shall be entertained and no certification election shall be
conducted by the Department of Labor and Employment outside of the sixty-day period
immediately before the date of expiry of such five-year term of the Collective Bargaining
Agreement. All other provisions of the Collective Bargaining Agreement shall be
renegotiated not later than three (3) years after its execution. Any agreement on such other
provisions of the Collective Bargaining Agreement entered into within six (6) months from
the date of expiry of the term of such other provisions as fixed in such Collective Bargaining
Agreement, shall retroact to the day immediately following such date. If any such agreement
is entered into beyond six months, the parties shall agree on the duration of the retroactivity
thereof. In case of a deadlock in the renegotiation of the collective bargaining agreement,
the parties may exercise their rights under this Code.
Under this provision, insofar as representation is concerned, a CBA has a term of five years,
while the other provisions, except for representation, may be negotiated not later than three
years after the execution. Petitioners submit that a 10-year CBA suspension is inordinately
long, way beyond the maximum statutory life of a CBA, provided for in Article 253-A. By
agreeing to a 10-year suspension, PALEA, in effect, abdicated the workers constitutional
right to bargain for another CBA at the mandated time.
We find the argument devoid of merit.
A CBA is a contract executed upon request of either the employer or the exclusive
bargaining representative incorporating the agreement reached after negotiations with
respect to wages, hours of work and all other terms and conditions of employment, including
proposals for adjusting any grievances or questions arising under such agreement. The
primary purpose of a CBA is the stabilization of labor-management relations in order to
create a climate of a sound and stable industrial peace. In construing a CBA, the courts
must be practical and realistic and give due consideration to the context in which it is
negotiated and the purpose which it is intended to serve.
The assailed PAL-PALEA agreement was the result of voluntary collective bargaining
negotiations undertaken in the light of the severe financial situation faced by the employer,
with the peculiar and unique intention of not merely promoting industrial peace at PAL, but
preventing the latters closure. We find no conflict between said agreement and Article 253A of the Labor Code. Article 253-A has a two-fold purpose. One is to promote industrial
stability and predictability. Inasmuch as the agreement sought to promote industrial peace at

PAL during its rehabilitation, said agreement satisfies the first purpose of Article 253-A. The
other is to assign specific timetables wherein negotiations become a matter of right and
requirement. Nothing in Article 253-A, prohibits the parties from waiving or suspending the
mandatory timetables and agreeing on the remedies to enforce the same.