Republic of the Philippines

Batangas State University

Batangas City

College of Law
2nd Semester, AY 2019-2020

List of Cases for Labor Law 2

Article 218 (211) to Article 231 (225)

1. Philacor v. Hon. Laguesma, G.R. 105223, 27 September 1998

G.R. No. 105223 September 27, 1993

PHILIPPINE APPLIANCE CORPORATION, (PHILACOR), petitioner,

vs.
THE HON. BIENVENIDO E. LAGUESMA, in his capacity as Undersecretary of Labor & Employment, GENUINE LABOR
ORGANIZATION OF WORKERS IN HOTEL, RESTAURANT & ALLIED INDUSTRIES, (GLOWHRAIN) and THE
HONORABLE BERNARDINO B. JULVE in his capacity as DIRECTOR IV, DOLE REGIONAL OFFICE, NATIONAL
CAPITAL REGION (NCR), respondents.

Augusto S. Sanchez and Associate Law Firm for petitioner.

Arellano, Flores, Miralles, Rañeses, Taquio and Associates for private respondent.

QUIASON, J.:

This is a petition for certiorari under Rule 65 of the Revised Rules of Court to annul and set aside the Order dated march
30, 1992 of respondent Bienvenido E. Laguesma, as Undersecretary of Labor and Employment in NCR-OD-M-90-11-060,
entitled "IN RE: PETITION FOR CERTIFICATION ELECTION OF ALL SUPERVISORY EMPLOYEES OF THE
PHILIPPINE APPLIANCE CORPORATION (PHILACOR). GENUINE LABOR ORGANIZATION OF WORKERS IN
HOTEL, RESTAURANT AND ALLIED INDUSTRIES (GLOWHRAIN), petitioner." The order complained of, affirmed the
Order dated August 14, 1991 of Med-Arbiter Rosadali G. Abdullah, allowing certain employees to participate and cast
their votes in the certification election.

On November 21, 1990, respondent the Genuine Organization of Workers in Hotel, Restaurant and Allied Industries
(GLOWHRAIN) failed with the Department of Labor and Employment (DOLE) a petition for certification election among the
supervisory employees of petitioner, docketed as Case
No. NCR-OD-M-90-11-060 (Annex "C", Rollo, p. 49).

On January 3, 1991, petitioner filed a "Qualified Opposition," opposing the petition on the ground that the employees
sought to be represented by respondent GLOWHRAIN are not supervisory employees, as defined by the Labor Code as
amended but are, in fact, managerial employees exercising one or more managerial prerogatives and functions and that
the genuine supervisory employees having the right to join, assist or form a labor organization are its foremen and
linemen who are already members of the rank-and-file union (Annex "D", Rollo, p. 53).

On January 17, 1991, respondent GLOWHRAIN filed its "COMMENT and POSITION PAPER" attaching therewith
supporting documents to show that union members claimed by petitioner to be managerial employees are supervisors
with recommendatory powers (Rollo, p. 117).

On February 5, 1991, petitioner filed a "Supplement to Qualified Opposition," presenting specific instances as evidenced
by company memoranda whereby petitioning employees were shown to have exercised managerial powers, functions and
prerogatives whose decisions were instantly effective and not merely recommendatory. In said supplemental opposition,
petitioner also alleged that the issue of whether petitioning employees are managerial employees constituted a prejudicial
question, which should be resolved before any further proceedings could continue (Annex "E", Rollo, p. 66).

On February 25, 1991 respondent GLOWHRAIN filed a "Reply" stating that no prejudicial question existed.

On March 14, 1991, petitioner filed a "Rejoinder," explaining the nature of the documents attached to respondent
GLOWHRAIN's reply and describing petitioner's company structure, as well as the corresponding tasks, duties and
responsibilities of petitioning employees in such structure. It also emphasized that as can be gleaned from the company
structure and the actual functions being performed by the petitioning employees, the supervisory employees of said
company were the linemen and foreman who were already members of the rank-and-file union (Annex "F", Rollo, p. 121).

On March 6, 1991, Med-Arbiter Rosadali C. Abdullah issued an order directing the holding of a certification election
among the supervisory employees of petitioner. The dispositive portion said order reads:

WHEREFORE, on the foregoing consideration, let a certification election be conducted among the supervisory employees
of the Philippine Appliance Corporation (PHILACOR) within twenty (20) days from receipt hereof, subject to the usual pre-
election conference of the parties to thresh out the mechanics of the election. The payroll of the company three (3)
months prior to the filing of the petition shall be used as the basis in determining the list of eligible voters.

The choices are:

(a) GLOWHRAIN — Philippine Appliance Corporation Supervisor's Association; and

(b) No union (Rollo, p. 177).

Pursuant to the aforestated order, petitioner was required to submit a list of all supervisory employees of the company
based on the payroll three months prior to the date of the petition.

On April 29, 1991, petitioner filed a "Compliance and Manifestation," (Annex "H", Rollo, p. 178), attaching two separate
lists of employees. The first list (Annex "1", Rollo, p. 208) contained the list of employees designated as supervisors or
equivalent rank. The second list (Annex "1-A", Rollo, p. 214) contained the names of employees designated as foremen
and linemen whom petitioner deemed as its genuine supervisory employees.

On May 3, 1991, petitioner filed a "Motion to Exclude" those employees listed in Annex "1" alleging that these employees
though occupying positions designated as "Supervisor" are in reality, managerial employees by virtue of their exercise of
managerial functions and prerogatives which are not merely recommendatory. Petitioner reiterated its claim that the true
supervisors of the company falling within the scope and definition of the Labor Code are the company foremen and
linemen and some who are occupying the title of "Supervisor" (Annex "I", Rollo, p. 187).

After respondent GLOWHRAIN and petitioner submitted their respective position papers, the Med-Arbiter issued on
August 14, 1991 an order, the dispositive portion of which reads:

WHEREFORE, premises considered, an Order is hereby issued, allowing the employees listed in Annex "1" of the
company's Motion to Exclude dated May 3, 1991, with Nos. 2, 3, 8, 9, 11, 12, 13, 14, 16, 17, 18, 19, 20, 23, 24, 26, 28, 29,
31, 33, 35, 36, 37, 39, 41, 43, 44, 45, 46, 48, 50, 51, 53, 56, 58, 59, 60, 61, 63, 64, 66, 67, 69, 72, 76, 78, 79, 80, 81, 82,
86, 87, 89, 90, 91, 92, 93, 94, 95, 98, 99, 100, 103, 104, 105, 106, 108, 110, 111, 112, 116, 117, 119, 120, 121, 122, 123,
124, 125, 126, 127, 128, 129, 130, 131, 132, 133, 134, 136, 139, 140, 146, 149, 151, 154, 155, 157, 161, 162, 163, 164,
167, 170, 174, 176, 177, 178, 182, 184, 185, 187, 188, 192, and those listed in Annex "1-A" of the same motion with Nos.
2, 12, 13, 14, 31, 34, 36, 37, 38, 52, 57, 58, 71, 74, 76, 85, 87, to participate and cast their votes in the certification
election ordered in this case.

Let the record of this case be forwarded to the representation officer concerned and be guided accordingly (Rollo, p. 224-
225).

Petitioner assailed before the Office of the Secretary of Labor, the Med-Arbiter's decision allowing petitioning employees
to participate in the certification election.

It claimed that the true determination of the nature of the employment is based on the actual powers and prerogative
exercised by the employees and not the job titles or descriptions. It further questioned the Med-Arbiter's decision as
contradictory to his own express finding of fact that petitioning employees exercise managerial prerogatives or functions
(Annex "L", Rollo, p. 226).

On November 22, 1991, petitioner's appeal was denied for lack of merit and the Order of the Med-Arbiter dated August
14, 1991 was affirmed (Annex "M", Rollo, p. 248).

On December 6, 1991, petitioner filed a motion for reconsideration (Annex "N", Rollo, p. 249). In said motion, petitioner
attached for the first time the job descriptions of its Production Supervisor (Annex "A", Rollo, pp. 259-261), Superintendent
(Production) (Annex "B", Rollo, pp. 262-264) and Manager (Production) (Annex "C", Rollo, p. 265-267).

In its Resolution dated December 23, 1991, PHILACOR's Motion for Reconsideration modified the Resolution dated
November 22, 1991 by finding that the employees occupying the job titles of "Production Supervisor," "Superintendent
Production" and "Production Manager" are managerial employees imbued with managerial prerogatives, and therefore are
ineligible to participate in the certification election among the supervisory employees (Annex "O", Rollo, pp. 269-270).

Respondent GLOWHRAIN filed a motion for reconsideration, to which petitioner filed an "Opposition and Comment."

In its motion for reconsideration, respondent GLOWHRAIN challenged the authenticity of the job descriptions submitted
by petitioner, alleging that the same are irregular having been issued only for the purpose of buttressing petitioner's
motion for reconsideration.

On March 30, 1992, an order was issued granting GLOWHRAIN's motion for reconsideration and with the following
dispositive portion:

WHEREFORE, the Motion for Reconsideration of petitioner Genuine Labor Organization of Workers in Hotel, Restaurant
and Allied Industries (GLOWHRAIN) is hereby granted and the Order dated
23 December 1991 is hereby SET ASIDE. In lieu thereof, our Resolution dated 22 November 1991 is hereby
REINSTATED and AFFIRMED in toto.

No further motion of similar nature shall hereinafter be entertained (Annex "A", Rollo, pp. 43-44).

In his order, respondent Undersecretary of Labor found that the job descriptions submitted by petitioner were not issued in
the regular course of the business and neither were the concerned employees furnished copies for them to countersign as
an affirmation that the job descriptions are reflective of their true and actual function, duties and responsibilities.
Furthermore, the respondent Undersecretary of Labor said that there was nothing on record to show that the job
descriptions are the actual functions currently being performed by the concerned employees. Hence, he concluded that
the job descriptions submitted by petitioner were considered belated issuances and a mere afterthought (Rollo, pp. 37-
44).

On April 23, 1992, petitioner filed a "Manifestation and Motion (for Reconsideration)" of the Order dated March 30, 1992,
which was denied in an Order dated April 24, 1992.
On May 21, 1992, petitioner filed this petition for certiorari, with prayer for "a restraining order and/or a writ of preliminary
injunction" to restrain or enjoin the holding of the certification election (Rollo, pp. 2-36).

On June 29, 1992, the Third Division of this Court resolved "to issue a Temporary Restraining Order effective as of this
date and continuing until otherwise ordered by this Court" (Rollo, p. 327).

The main issue to be resolved is whether the petitioning employees are supervisory employees eligible to form a
supervisory union.

Under the old Industrial Peace Act (Republic Act No. 875), the term "supervisor" was denied as follows:

Sec. 2 Definitions — As used in this Act —

xxx xxx xxx

(k) "Supervisor" means any person having authority in the interest of an employer, to hire, transfer, suspend, lay-off,
recall, discharge, assign, recommend, or discipline, other employees, or responsibly to direct them, and to adjust their
grievances, or effectively to recommend such acts if, in connection with the foregoing, the exercise of such authority is not
of a merely routinary or clerical nature but requires the use of independent judgment.

With the enactment of Presidential Decree No. 442 as amended, otherwise known as the Labor Code of the Philippines,
the term "supervisor" was replaced by the term "managerial employee."

The Labor Code was further amended by Republic Act No. 6715. Section 4 of the said Republic Act, amended Article 212
(m), which now contains separate definitions for managerial and supervisory employees, to wit:

Art. 212. Definitions.

xxx xxx xxx

(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. . . . (emphasis supplied)

The test of "supervisory" or "managerial status" depends on whether a person possesses authority to act in the interest of
his employer in the manner specified in Article 212 (m) of the Labor Code and Rule 1(o) of Book V of its Implementing
Rules and whether such authority is not merely routinary or clerical in nature, but requires the use of independent
judgment. Thus, where such recommendatory powers as in the case before us, are subject to evaluation, review and final
action by the department heads and other higher executives of the company, the same, although present, are not
effective and not an exercise of independent judgment as required by law (Franklin Baker Company of the Philippines. v.
Trajano, 157 SCRA 416 [1988] citing National Warehouse Corp. v. CIR, 7 SCRA 602-603 [1963]).

A careful analysis of the record discloses that in the exercise of the above enumerated managerial powers, petitioning
employees are "given policies to executed and standard policies to observe, thus having little freedom of action" (National
Waterworks and Sewerage Authority v. NWSA Consolidated, 11 SCRA 766 [1964]).

Furthermore, it will be noted that petitioning employees merely recommend the implementation of management policies or
the discipline or dismissal of subordinates, as may be gleaned from the following:

In the filing/charging of overtime, petitioning employees are guided by Standard Procedure on Overtime/Charging (Annex
"1-A", Rollo, p. 93; Annex "1-B", Rollo, p. 94). The accomplishment of the "Overtime Work Authority" is the duty of the
supervisor who must affix his signature therein and forward the same to the manager who will likewise sign the same.
After which, it will be sent back to the supervisor concerned. In the formulation and issuance of this Management Guide,
petitioner admits that petitioning employees did not participate therein (Annex "F", Rollo, p. 131).

With regard to the procedure in the hiring of rank-and-file employees, the immediate supervisor files a notice in writing
with the Personnel Administration asking the latter to find qualified applicants for a position or job where there is vacancy.
The Personnel Department proceeds with the recruitment of qualified applicants, using as basis the applicable set of
general standards and the job requirements. All applicants who are considered by the Personnel Department to have met
both the general and specific requirements of the job are referred to a panel of four or five supervisors for interview and
determination who among said applicants should be hired for the particular job. The interview conducted by the panel
after the Personnel Department has already recruited qualified applicants cannot be said to vest in the supervisors the
power to hire. The said interview merely involves the accomplishment of an Interview Rating Form, which rates the
interviewee according to his general appearance, manner of speaking, alertness, physical condition, confidence, ability to
get along with others, ability to present ideas, maturity judgment and technical competence (Annex "4" & "5", Rollo, pp.
112-113). The ultimate power to hire still rest with the Manager of the Personnel Administration (Annex "4", Rollo, p. 111).

No evidence was presented by petitioner to bolster its claim that petitioning employees exercised the power to shorten
employees' probationary period and the power to change the status of or dismiss a casual employee.

As to the power to discipline, suspend and discharge employees, we find that the petitioning employees merely enforce
the company rules and regulations against erring employees. While it is true that the petitioning employees are the ones
who request for a formal investigation against an erring employee, it is the Corporate Legal Service which actually
conducts the formal investigation and on the basis of the result of the investigation, the Assistant Vice-President —
Human Resource Management — General Services is the one who imposes the corresponding penalty. The supervisor is
merely furnished a copy of the result of the investigation (Annex "9", Rollo, p. 368; Annex "9-A", Rollo, p. 369).
As to the power to assign or transfer employees, the petitioning employees merely execute the shifting rotation made by
the Plant Manager (Annex "8", "8-B", "8-D", "8-E", "8-F", "9-G" "8-H", Rollo, p. 359-367).

Even if petitioner considers petitioning employees as managers, the fact remains that they do not lay down and execute
management policies nor have the power to hire, but merely recommend such management actions. As such, petitioning
employees will still be considered as supervisors.

PHILACOR belatedly presented the job descriptions of the Production Supervisor, Superintendent (Production) and
Manager (Production) to show that indeed petitioning employees are exercising managerial powers and prerogatives. As
admitted by PHILACOR, the aforestated job descriptions were relatively new and were documented only on or about
August 1991 after the Med-Arbiter had already ordered the certification election of the petitioning employees.

We held in the case of Pagkakaisa ng mga Manggagawa sa Triumph International — United Lumber and General
Workers of the Philippines. v. Ferrer-Calleja, 181 SCRA 119 [1990] that "the fact that their work descriptions are either
managers or supervisors is of no moment considering that it is the nature of their functions and not the said
nomenclatures of titles of their jobs which determines their statuses.

WHEREFORE, the Order dated March 30, 1992 of respondent Undersecretary of Labor and Employment is AFFIRMED.
The Temporary Restraining Order issued by this Court is LIFTED.

SO ORDERED.
2. Union of Filipino Employees v. NLRC, G.R. No. 91025, 19 December 1990
[G.R. No. 91025. December 19, 1990.]

UNION OF FILIPRO EMPLOYEES, Petitioner, v. THE HONORABLE NATIONAL LABOR RELATIONS COMMISSION
and NESTLE PHILIPPINES, INC., Respondents.

Banzuela, Flores, Miralles, Raneses, Sy, Taquio & Associates for Petitioner.

Siguion Reyna, Montecillo & Ongsiako for Private Respondent.

RESOLUTION

MEDIALDEA, J.:

This special civil action of certiorari assails the resolution (dated June 5, 1989) of the National Labor Relations
Commission (NLRC) relative to Certified Case No. 0522, and the resolution denying the motion for reconsideration (dated
August 8, 1989).

The antecedents are:chanrob1es virtual 1aw library

On June 22, 1988, the petitioner Union of the Filipro Employees, the sole and exclusive bargaining agent of all rank-and-
file employees of Nestle Philippines, (private respondent) filed a Notice of Strike at the Department of Labor raising the
issues of CBA deadlock and unfair labor practice.

The National Conciliation and Mediation Board (NCMB) invited the parties for a conference on February 4, 1988 for the
purpose of settling the dispute. The private respondent however, assailed the legal personality of the proponents of the
said notice of strike to represent the Nestle employees. This notwithstanding, the NCMB proceeded to invite the parties to
attend the conciliation meetings and to which private respondent failed to attend contending that it will deal only with a
negotiating panel duly constituted and mandated in accordance with the UFE Constitution and By-laws.chanrobles law
library : red

The records show that before the filing of said notice of strike, or on June 30, 1987, the respective CBAs in the four (4)
units of Nestle, in Alabang-Cabuyao, Makati, Cagayan de Oro and Cebu/Davao work locations had all expired. Under the
said CBAs, Alabang/Cabuyao and Makati units were represented by the UFE; the Cagayan de Oro unit was represented
by WATU; while the Cebu-Davao was represented by TUPAS. Prior to the expiration of the CBAs for Makati and
Alabang/Cabuyao, UFE submitted to the company a list of CBA proposals. The company, on the other hand, expressed
its readiness to negotiate a new CBA for Makati and Alabang/Cabuyao units but reserved the negotiation for Cagayan de
Oro and Cebu-Davao considering that the issue of representation for the latter units was not yet settled. On June 10, 1987
and July 28, 1987, UFE was certified as the sole and exclusive bargaining representative of Cagayan de Oro and
Cebu/Davao units, respectively.

On September 14, 1987, the Company terminated from employment all UFE Union officers, headed by its president, Mr.
Manuel Sarmiento, and all the members of the negotiating panel for instigating and knowingly participating in a strike
staged at the Makati, Alabang, Cabuyao and Cagayan de Oro on September 11, 1987 without any notice of strike filed
and a strike vote obtained for the purpose.

On September 21, 1987, the union filed a complaint for illegal dismissal. The Labor Arbiter, in a decision dated January
12, 1988, upheld the validity of the dismissal of said union officers. The decision was later on affirmed by the respondent
NLRC en banc, on November 2, 1988.

Respondent company contends that, "with the dismissal of UFE officers including all the members of the union negotiating
panel as later on confirmed by the NLRC en banc, said union negotiating panel thus ceased to exist and its former
members divested of any legal personality, standing and capacity to act as such or represent the union in any manner
whatsoever."cralaw virtua1aw library

The union officers, on the other hand, asserted their authority to represent the regular rank-and-file employees of Nestle,
Philippines, being the duly elected officers of the union.

In the meantime, private respondent sought guidelines from the Department of Labor on how it should treat letters from
several splinter groups claiming to have possessed authority to negotiate in behalf of the UFE. It is noteworthy that aside
from the names of the negotiating panel submitted by one UFE officials, three (3) other groups in the Nestle plant in
Cabuyao and two groups in the Makati office have expressed a desire to bargain with management professing alleged
authorization from and by the general membership. These groups however, it must be noted, belong to just one (1) union,
the UFE.

In a letter dated August 20, 1988, BLR Director Pura Ferrer-Calleja advised:jgc:chanrobles.com.ph

"Any attempt on the part of management to directly deal with any of the factions claiming to have the imprimatur of the
majority of the employees, or to recognize any act by a particular group to adopt the deadlock counter proposal of the
management, at this stage, would be most unwise. It may only fan the fire." (Rollo, pp. 61-62)

On March 20, 1988 and August 5, 1988, the company concluded separate CBAs with the general membership of the
union at Cebu/Davao and Cagayan de Oro units, respectively. The workers thereat likewise conducted separate elections
of their officers.
Assailing the validity of these agreements, the union filed a case of ULP against the company with the NLRC-NCR
Arbitration Branch on November 16, 1988.

Efforts to resolve the dispute amicably were taken by the NCMB but yielded negative result because of the irreconcilable
conflicts of the parties on the matter of who should represent and negotiate for the workers.chanroblesvirtualawlibrary

On October 18, 1988, petitioner filed a motion asking the Secretary of Labor to assume jurisdiction over the dispute of
deadlock in collective bargaining between the parties. On October 28, 1988, Labor Secretary Franklin Drilon certified to
the NLRC the said dispute between the UFE and Nestle, Philippines, the relevant portion of which reads as
follows:jgc:chanrobles.com.ph

"WHEREFORE, above premises considered, this office hereby certifies the sole issue of deadlock in CBA negotiations
affecting the Makati, Alabang and Cabuyao units to the National Labor Relations Commission for compulsory arbitration.

"The NLRC is further directed to call all the parties immediately and resolve the CBA deadlock within twenty (20) days
from submission of the case for resolution." (Rollo, p. 225)

On June 5, 1989, the Second Division of the NLRC promulgated a resolution granting wage increase and other benefits to
Nestle’s employees, ruling on non-economic issues, as well as absolving the private respondent of the Unfair Labor
Practice charge. The dispositive portion states as follows:jgc:chanrobles.com.ph

"WHEREFORE, as aforestated, the parties are hereby ordered to execute and implement through their duly authorized
representatives a collective bargaining agreement for a duration of five (5) years from promulgation of this Resolution.

"SO ORDERED." (Rollo, p. 180)

Petitioner finds said resolution to be inadequate and accordingly, does not agree therewith. It filed a motion for
reconsideration, which was, however, denied on August 8, 1989.

Hence, this petition for certiorari.

Petitioner originally raised 13 errors committed by the public Respondent. However, in its Urgent Manifestation and
Motion dated September 24, 1990, petitioner limited the issues to be resolved into six (6). Thus, only the following shall be
dealt with in this resolution:chanrob1es virtual 1aw library

1. WHETHER OR NOT THE SECOND DIVISION OF THE NLRC ACTED WITHOUT JURISDICTION IN RENDERING
THE ASSAILED RESOLUTION, THE SAME BEING RENDERED ONLY BY A DIVISION OF THE PUBLIC
RESPONDENT AND NOT BY EN BANC;

2. WHETHER OR NOT THE RESPONDENT NLRC SERIOUSLY ERRED IN HOLDING THAT THE CBA TO BE SIGNED
BY THE PARTIES SHALL COVER SOLELY THE BARGAINING UNIT CONSISTING OF ALL REGULAR RANK-AND-
FILE EMPLOYEES OF THE RESPONDENT COMPANY AT MAKATI, ALABANG AND CABUYAO;

3. WHETHER OR NOT THE RESPONDENT NLRC HAD ACTED WITH GRAVE ABUSE OF DISCRETION AND
COMMITTED SERIOUS ERRORS IN FACT AND IN LAW WHEN IT RULED THAT THE CBA IS EFFECTIVE ONLY
UPON THE PROMULGATION OF THE ASSAILED RESOLUTION;

4. WHETHER OR NOT PUBLIC RESPONDENT HAD SERIOUSLY ERRED IN DENYING PETITIONER’S DEMAND FOR
A CONTRACT SIGNING BONUS AND IN TOTALLY DISREGARDING THE LONG PRACTICE AND TRADITION IN THE
COMPANY WHICH AMOUNT TO DIMINUTION OF EMPLOYEES BENEFITS;

5. WHETHER OR NOT PUBLIC RESPONDENT SERIOUSLY ERRED IN NOT GRANTING THE UNION’S DEMAND
FOR A "MODIFIED UNION SHOP" SECURITY CLAUSE IN THE CBA AS ITS RULING CLEARLY COLLIDES WITH
SETTLED JURISPRUDENCE ON THE MATTER;

6. WHETHER OR NOT PUBLIC RESPONDENT ERRED IN ENTIRELY ABSOLVING THE COMPANY FROM THE
UNFAIR LABOR PRACTICE CHARGE AND IN DISREGARDING THE SUBSTANTIAL INCRIMINATORY EVIDENCE
RELATIVE THERETO; (p. 9, Petitioner’s Urgent Manifestation and Motion dated September 24, 1990).

Counsel for the private respondent company filed a motion for leave of court to oppose the aforesaid urgent manifestation
and motion. It appearing that the allowance of said opposition would necessarily delay the early disposition of this case,
the Court Resolved to DISPENSE with the filing of the same.chanrobles virtual lawlibrary

We affirm the public respondent’s findings and rule as regards the issue of jurisdiction.

This case was certified on October 28, 1988 when existing rules prescribed that, it is incumbent upon the Commission en
banc to decide or resolve a certified dispute. However, R.A. 6715 took effect during the pendency of this case. Aside from
vesting upon each division the power to adjudicate cases filed before the Commission, said Act further provides that the
divisions of the Commission shall have exclusive appellate jurisdiction over cases within their respective territorial
jurisdiction.

Section 5 of RA 6715 provides as follows:jgc:chanrobles.com.ph

"Section 5. Article 213 of the Labor Code of the Philippines, as amended, is further amended to read as
follows:chanrob1es virtual 1aw library
Art. 213. National Labor Relations Commission. — There shall be a National Labor Relations Commission which shall be
attached to the Department of Labor and Employment for program and policy coordination only, composed of (a)
Chairman and fourteen (14) Members.

Five (5) members each shall be chosen from among the nominees of the workers and employers organization,
respectively. The Chairman and the four (4) remaining members shall come from the public sector, with the latter to be
chosen from among the recommendees of the Secretary of Labor and Employment.

Upon assumption into office, the members nominated by the workers and employers organizations shall divest
themselves of any affiliation with or interest in the federation or association to which they belong.

The Commission may sit en banc or in five (5) divisions, each composed of three (3) members. The Commission shall sit
en banc only for purposes of promulgating rules and regulations governing the hearing and disposition of cases before
any of its divisions and regional branches and formulating policies affecting its administration and operations. The
Commission shall exercise its adjudicatory and all other powers, functions and duties through its divisions. Of the five (5)
divisions, the first and second divisions shall handle cases coming from the National Capital Region and the third, fourth
and fifth divisions, cases from other parts of Luzon, from the Visayas and Mindanao, respectively. The divisions of the
Commission shall have exclusive appellate jurisdiction over cases within their respective territorial jurisdiction.

The concurrence of two (2) Commissioners of a division shall be necessary for the pronouncement of a judgment or
resolution. Whenever the required membership in a division is not complete and the concurrence of two (2)
commissioners to arrive at a judgment or resolution cannot be obtained, the Chairman shall designate such number of
additional Commissioners from the other divisions as may be necessary.

The conclusions of a division on any case submitted to it for decision shall be reached in consultation before the case is
assigned to a member for the writing of the opinion. It shall be mandatory for the division to meet for purposes of the
consultation ordained therein. A certification to this effect signed by the Presiding Commissioner of the division shall be
issued, and a copy thereof attached to the record of the case and served upon the parties.

The Chairman shall be the Presiding Commissioner of the first division, and the four (4) other members from the public
sector shall be the Presiding Commissioners of the second, third, fourth and fifth divisions, respectively. In case of the
effective absence or incapacity of the Chairman, the Presiding Commissioner of the second division shall be the Acting
Chairman.

The Chairman, aided by the Executive Clerk of the Commission, shall have administrative supervision over the
Commission and its regional branches and all its personnel, including the Executive Labor Arbiters and Labor Arbiters.

The Commission when sitting en banc, shall be assisted by the same Executive Clerk, and, when acting thru its Divisions,
by said Executive Clerk for its First Division and four (4) other Deputy Executive Clerks for the Second, Third, Fourth, and
Fifth Divisions, respectively, in the performance of such similar or equivalent functions and duties as are discharged by
the Clerk of Court and Deputy Clerks of Court of the Court of Appeals." (Emphasis supplied)

In view of the enactment of Republic Act 6715, the aforementioned rules requiring the Commission en banc to decide or
resolve a certified dispute have accordingly been repealed. This is supported by the fact that on March 21, 1989, the
Secretary of Labor, issued Administrative Order No. 36 (Series of 1989), which reads:jgc:chanrobles.com.ph

"2. Effective March 21, 1989, the date of the effectivity of Republic Act 6715, the Commission shall cease holding en banc
sessions for purposes of adjudicating cases and shall discharge their adjudicatory functions and powers through their
respective Divisions."cralaw virtua1aw library

Contrary to the claim of the petitioner, the above-cited Administrative Order is valid, having been issued in accordance
with existing legislation as the Secretary of Labor is clothed with the power to promulgate rules for the implementation of
the said amendatory law.chanrobles virtual lawlibrary

Section 36 of R.A. 6715 provides:chanrob1es virtual 1aw library

Section 36. Rule-Making Authority. — The Secretary of Labor and Employment is hereby authorized to promulgate such
rules and regulations as may be necessary to implement the provisions of this Act."cralaw virtua1aw library

Moreover, it is to be emphasized and it is a matter of judicial notice that since the effectivity of R.A. 6715, many cases
have already been decided by the five (5) divisions of the NLRC. We find no legal justification in entertaining petitioner’s
claim considering that the clear intent of the amendatory provision is to expedite the disposition of labor cases filed before
the Commission. To rule otherwise would not be congruous to the proper administration of justice.

As to the second issue, the Court is convinced that the public respondent committed no grave abuse of discretion in
resolving only the sole issue certified to by the Secretary and formulating a CBA which covers the bargaining units
consisting of all regular rank-and-file employees of the respondent company at Makati, Alabang and Cabuyao only.

In its assailed resolution, public respondent stated:jgc:chanrobles.com.ph

"A perusal of the records and proceedings of this case reveals that after the issuance by the Secretary of Labor of his
Order dated 28 October 1988 certifying the dispute to Us, the Union filed an Urgent Manifestation seeking the modification
of the certification order to include the Cebu Davao and Cagayan de Oro divisions, the employees/workers therein being
all bonafide members of the Union which is the sole and exclusive bargaining representative of all the regular rank-and-
file workers of the company nationwide. Their non-inclusion in the certification order, the union argues, would give
premium to the alleged unlawful act of the Company in entering into separate ‘Collective Bargaining Agreements’ directly
with the workers thereat.
"In the same vein, the union manifested its intention to file a complaint for ULP against the company and its officers
responsible for such act, which it eventually did.

"Considering that the Union had reserved the right to prosecute the Company and its officers responsible for the alleged
unlawful execution of the CBA directly with the union members in Cagayan de Oro and Cebu/Davao units, as it has in fact
filed a case which is now pending with our Arbitration Branch, the issue as to whether such acts constitute ULP is best
heard and decided separately from the certified case, not only because of the evidentiary need to resolve the issue, but
also because of the delay that may ensue in the resolution of the present conflict.

"Furthermore, the consolidation of the issue with the instant case poses complicated questions regarding venue and
joinder of parties. We feel that each of the issues propounded by the parties shall be better dealt with separately
according to its own merits.

"Thus, We rule to resolve the sole issue in dispute certified to this Commission, i.e., the deadlock in the collective
bargaining negotiations in Cabuyao/Alabang and Makati units." (Rollo, pp. 174-176)

We agree. Public respondent’s resolution is proper and in full compliance with the order of the Secretary of Labor. The
concomittant delay that will result in resolving petitioner’s motion for the modification of the certification order to determine
whether to include Cebu/Davao and Cagayan de Oro Divisions or not will defeat the very purpose of the Secretary of
Labor’s assumption of jurisdiction and his subsequent certification order for compulsory arbitration.

The assumption of jurisdiction by the Secretary of Labor over labor disputes causing or likely to cause a strike or lockout
in an industry indispensable to the national interest is in the nature of a police power measure. It cannot be denied that the
private respondent is engaged in an undertaking affected with public interest being one of the largest manufacturers of
food products. The compelling consideration of the Secretary’s assumption of jurisdiction is the fact that a prolonged strike
or lockout is inimical to the national economy and thus, the need to implement some measures to suppress any act which
will hinder the company’s essential productions is indispensable for the promotion of the common good. Under this
situation, the Secretary’s certification order for compulsory arbitration which was intended for the immediate formulation of
an already delayed CBA was proper.

Corollarily, the NLRC was thereby charged with the task of implementing the certification order for compulsory arbitration.
As the implementing body, its authority did not include the power to amend the Secretary’s order (University of Santo
Tomas v. National Labor Relations Commission, UST Faculty Union, G.R. No. 89920, October 18, 1990).cralawnad

For the same reason, We rule that the prayer to declare the respondent company guilty of acts of unfair labor practice
when it allegedly resorted to practices designed to delay the collective bargaining negotiations cannot be subsumed in this
petition, it being beyond the scope of the certification order.

Petitioner argues that because of the public respondent’s actuation in this regard, it committed grave abuse of discretion
as it allowed multiplicity of suits and splitting causes of action which are barred by procedural rule.

We cannot subscribe to this argument. In the recent case of the Philippine Airlines, Inc. v. National Labor Relations
Commission, this Court had occasion to define what a compulsory arbitration is. In said case, this Court
stated:jgc:chanrobles.com.ph

"When the consent of one of the parties is enforced by statutory provisions, the proceeding is referred to as compulsory
arbitration In labor cases, compulsory arbitration is the process of settlement of labor disputes by a government agency
which has the authority to investigate and to make an award which is binding on all the parties. (G.R. No. 55159, 22 Dec.
89)."cralaw virtua1aw library

When sitting in a compulsory arbitration certified to by the Secretary of Labor, the NLRC is not sitting as a judicial court
but as an administrative body charged with the duty to implement the order of the Secretary. Its function only is to
formulate the terms and conditions of the CBA and cannot go beyond the scope of the order. Moreover, the Commission
is further tasked to act within the earliest time possible and with the end in view that its action would not only serve the
interests of the parties alone, but would also have favorable implications to the community and to the economy as a
whole. This is the clear intention of the legislative body in enacting Art. 263 paragraph (g) of the Labor Code, as amended
by Section 27 of R.A. 6175, which provides:chanrob1es virtual 1aw library

(g) When in his opinion, there exists a labor dispute causing or likely to cause a strike or lockout in an industry
indispensable to the national interest, the Secretary of Labor and Employment may assume jurisdiction over the dispute
and decide it or certify the same to the Commission for compulsory arbitration. Such assumption or certification shall have
the effect of automatically enjoining the intended or impending strike or lockout as specified in the assumption or
certification order. If one has already taken place at the time of assumption or certification, all striking or lockout
employees shall immediately return to work and the employer shall immediately resume operations and readmit all
workers under the same terms and conditions prevailing before the strike or lockout. The Secretary of Labor and
Employment or the Commission may seek the assistance of law enforcement agencies to ensure compliance with this
provision as well as with such orders as he may issue to enforce the same. (Emphasis supplied)

In view of the avowed but limited purpose of respondent’s assumption of jurisdiction over this compulsory arbitration case,
it cannot be faulted in not taking cognizance of other matters that would defeat this purpose.

As regards the third issue raised by petitioner, this Court finds the provisions of Article 253 and Article 253-A of the Labor
Code as amended by R.A. 6715 as the applicable laws, thus:jgc:chanrobles.com.ph

"Art. 253. Duty to bargain collectively when there exists a collective bargaining agreement. — When there is a collective
bargaining agreement, the duty to bargain collectively shall also mean that neither party shall terminate nor modify such
agreement during its lifetime. However, either party can serve a written notice to terminate or modify the agreement at
least sixty (60) days prior to its expiration date. It shall be the duty of both parties to keep the status quo and to continue in
full force and effect the terms and conditions of the existing agreement during the 60-day period and/or until a new
agreement is reached by the parties.

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 the 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 retroactivity thereof . In case of a
deadlock in the renegotiation of the collective bargaining agreement, the parties may exercise their rights under this
Code." (Emphasis supplied)

In the light of the foregoing, this Court upholds the pronouncement of the NLRC holding the CBA to be signed by the
parties effective upon the promulgation of the assailed resolution. It is clear and explicit from Article 253-A that any
agreement on such other provisions of the CBA shall be given retroactive effect only when it is entered into within six (6)
months from its expiry date. If the agreement was entered into outside the six (6) month period, then the parties shall
agree on the duration of the retroactivity thereof.chanrobles lawlibrary : rednad

The assailed resolution which incorporated the CBA to be signed by the parties was promulgated June 5, 1989, and
hence, outside the 6 month period from June 30, 1987, the expiry date of the past CBA. Based on the provision of Section
253-A, its retroactivity should be agreed upon by the parties. But since no agreement to that effect was made, public
respondent did not abuse its discretion in giving the said CBA a prospective effect. The action of the public respondent is
within the ambit of its authority vested by existing laws.

In assailing the public respondent’s actuation, the Union cited the case of Villar v. Inciong (121 SCRA 444) where this
Court ruled:jgc:chanrobles.com.ph

". . . While petitioners were charged for alleged commission of acts of disloyalty inimical to the interests of the Amigo
Employees Union-PAFLU in the Resolution of February 14, 1977 of the Amigo-Employees Union-PAFLU and on February
15, 1977, PAFLU and the company entered into and concluded a new collective bargaining agreement, petitioners may
not escape the effects of the security clause under either the old CBA or the new CBA by claiming that the old CBA had
expired and that the new CBA cannot be given retroactive enforcement. To do so would be to create a gap during which
no agreement would govern, from the time the old contract expired to the time a new agreement shall have been entered
into with the union . . ."cralaw virtua1aw library

In the aforecited case, the Court only pointed out that, it is not right for union members to argue that they cannot be
covered by the past and the new CBAs both containing the same closed-shop agreement for acts committed during the
interregnum. What was emphasized by this Court is that in no case should there be a period in which no agreement would
govern at all. But nowhere in the said pronouncement did We rule that every CBA contracted after the expiry date of the
previous CBA must retroact to the day following such date. Hence, it is proper to rule that in the case at bar, the clear and
unmistakable terms of Articles 253 and 253-A must be deemed controlling.

Articles 253 and 253-A mandate the parties to keep the status quo and to continue in full force and effect the terms and
conditions of the existing agreement during the 60-day period prior to the expiration of the old CBA and/or until a new
agreement is reached by the parties. Consequently, there being no new agreement reached, the automatic renewal
clause provided for by the law which is deemed incorporated in all CBAs, provides the reason why the new CBA can only
be given a prospective effect.

Petitioner claims that because of the prospective effect of the CBA, union members were deprived of substantial amount
of monetary benefits which they could have enjoyed had the CBA be given retroactive effect. This would include
backwages, the immediate effects of the mandated wage increase on the fringe benefits such as the 13th and 14th month
pay, overtime premium, and right to differential pay, leaves, etc. This Court, is not unmindful of these. Nevertheless, We
are convinced that the CBA formulated by public respondent is fair, reasonable and just. Even if prospective in effect, said
CBA still entitles the Nestle workers and employees reasonable compensation and benefits which, in the opinion of this
Court, is one of the highest, if not the highest in the industry. Petitioner did not succeed in overcoming the presumption of
regularity in the performance of the public respondent’s functions. Even if the resolution fell short of meeting the numerous
demands of the union, the petitioner failed to establish that public respondent committed grave abuse of discretion in not
giving the CBA a retrospective effect.

The fourth and fifth assignment of errors should be resolved jointly considering that they are the terms and conditions of
the CBA.

According to petitioner, the terms and conditions thereof are inadequate, unreasonable, incompetitive and thus, prejudicial
to the workers. It further decries public respondent’s alleged taking side with the private Respondent. Petitioner contends
that in issuing the assailed resolutions, public respondent considered only the position of the private respondent and
totally disregarded that of the petitioner. It further avers that the awards are bereft of any factual and legal basis.

Petitioner made so many claims and statements which were adopted and asserted without good ground. It fails to
substantiate why, in not granting its demands for the inclusion in the CBA of a "Contract Signing Bonus" and a "Modified
Union Shop Agreement," the assailed resolutions were erroneous and were drawn up arbitrarily and
whimsically.chanrobles.com:cralaw:red

In the case of Palencia v. National Labor Relations Commission, G.R. No. 75763, August 21, 1987, 153 SCRA 247, We
ruled that the findings of fact of the then Court of Industrial Relations (now NLRC), are conclusive and will not be
disturbed. Thus:jgc:chanrobles.com.ph
"Following a long line of decisions this Court has consistently declined to disturb the findings of fact of the then Court of
Industrial Relations whose functions the NLRC now performs. [Pambusco Employees Union Inc. v. Court of Industrial
Relations, 68 Phil. 591 (1939); Manila Electric Co. v. National Labor Union, 70 Phil. 617 (1940); San Carlos Milling Co. v.
Court of Industrial Relations, 111 Phil. 323 (1961),1 SCRA 734; Philippine Educational Institution v. MLQSEA Faculty
Assn., 135 Phil. 282 (1968), 26 SCRA 272; University of Pangasinan Faculty Union v. University of Pangasinan and
NLRC, G.R. No. L-63122, February 20, 1984, 127 SCRA 691]. The findings of fact are conclusive and will not be
disturbed in the absence of a showing that there has been grave abuse of discretion. [Philippine Educational Institution v.
MLQSEA Faculty Association, 26 SCRA 272, 276] and there being no indication that the findings are unsubstantiated by
evidence [University of Pangasinan Faculty Union v. University of Pangasinan and NLRC, G.R. No. 63122, February 20,
1984, 127 SCRA 694, 704]."cralaw virtua1aw library

Moreover, the NLRC is in the best position to formulate a CBA which is equitable to all concerned. Because of its
expertise in settling labor disputes, it is imbued with competence to appraise and evaluate the evidence and positions
presented by the parties. In the absence of a clear showing of grave abuse of discretion, the findings of the respondent
NLRC on the terms of the CBA should not be disturbed.

Taken as a whole, the assailed resolutions are after all responsive to the call of compassionate justice observed in labor
law and the dictates of reason which is considered supreme in every adjudication.

ACCORDINGLY, PREMISES CONSIDERED, the petition is DISMISSED. The Resolutions of the NLRC, dated June 5,
1989 and August 8, 1989 are AFFIRMED, except insofar as the ruling absolving the private respondent of unfair labor
practice which is declared SET ASIDE.chanrobles virtual lawlibrary

SO ORDERED.
3. Mina v. NLRC, 14 July 1995
[G.R. Nos. 97251-52. July 14, 1995.]

JOVENCIO MINA, RICARDO WANGIT, ANTHONY FARNICAN, PETER ATUBAN AND ARTHUR ALTATIS, Petitioners,
v. NATIONAL LABOR RELATIONS COMMISSION (NLRC) and ITOGON-SUYOC MINES, INC., Respondents.

Eduardo B. Badecao for Petitioner.

Solicitor General for respondent NLRC.

Arnulfo F . Manzano for Private Respondent.

SYLLABUS

1. LABOR LAWS, NATIONAL LABOR RELATIONS COMMISSION; JURISDICTION; DIVISIONS OF THE COMMISSION
SHALL HAVE EXCLUSIVE APPELLATE JURISDICTION OVER CASES WITHIN THEIR RESPECTIVE TERRITORIAL
JURISDICTION. — Under Article 213 of the Labor Code of the Philippines, as amended by R.A. No. 6715, ‘. . . Of the five
(5) divisions [of the NLRC], the First and Second Divisions shall handle cases coming from the National Capital Region
and the Third, Fourth and Fifth Divisions, cases from other parts of Luzon, from the Visayas and Mindanao, respectively.
The divisions of the Commission shall have exclusive appellate jurisdiction over cases within their respective territorial
jurisdiction" (Emphasis supplied).

2. ID.; ID.; ID.; VESTED IN THE DIFFERENT DIVISIONS OF THE NLRC AND NOT IN THE INDIVIDUAL
COMMISSIONERS ASSIGNED TO EACH DIVISION. — The law is clear that the jurisdiction to decide cases appealed to
NLRC is vested in the different divisions thereof, not in the individual commissioners assigned to each division. It is
therefore of no significance as to who of the commissioners is functioning in the division at any given time. The only
matter of concern is that the Commissioners voting on the motion for reconsideration were duly assigned to the division.

3. ID.; TERMINATION OF EMPLOYMENT; RESPONDENT COMPANY JUSTIFIED IN TERMINATING SERVICES OF

PETITIONERS AS THERE IS REASONABLE GROUND TO BELIEVE THAT THEY COMMITTED THE CRIME OF
HIGHGRADING. — Going now to the claim that petitioners were illegally dismissed, we find and so hold that substantial
evidence exists to warrant the finding that petitioners were engaged in highgrading. It is not imperative that all the
elements of highgrading or theft of gold as defined by Section 1 of P.D. No. 581 exist to justify respondent company’s loss
of trust and confidence in petitioners. The job of petitioners, as miners, although generally described as menial, is,
nevertheless, of such nature as to require a substantial amount of trust and confidence on the part of respondent
company. Since there is reasonable ground to believe that petitioners committed the crime of highgrading, respondent
company is justified in terminating their services.

4. REMEDIAL LAW; EVIDENCE; FACTUAL FINDINGS OF LABOR OFFICIALS ENTITLED TO FINALITY IF

SUPPORTED BY SUBSTANTIAL EVIDENCE. — It is well-established that factual findings of labor administrative officials,
if supported by substantial evidence, are entitled not only to great respect but even to finality (Baguio Colleges Foundation
v. National Labor Relations Commission, 222 SCRA 604 [1993]; Capitol Industrial Construction Groups v. National Labor
Relations Commission, 221 SCRA 469 [1993]).

DECISION

QUIASON, J.:

This is a petition for certiorari to set aside the decision of the Third Division of the National Labor Relations Commission
(NLRC) in NLRC Case No. RAB-I-0044-81 and NLRC Case No. RAB-I-0045-81 upholding the dismissal of petitioners.

The facts as narrated by the Labor Arbiter are as follows:jgc:chanrobles.com.ph

"These cases of illegally dismissal were filed on December 11, 1981 by Anthony Farnican, Arthur Altatis and Ricardo
Wangit in the first case, No. 0044-81, and Jovencio Mina and Peter Atuban in the second case, No. 0045-81. They have
been consolidated since the complainants have the same causes of action against the same respondent, Itogon-Suyoc
Mines, Inc. The records do not show what was their respective pay when the complainants were all discharged on
December 3, 1981.

"On November 20, 1981, between 11:00 p.m. and 11:45 p.m., herein complainants were allegedly caught in the act of
highgrading. According to the respondent’s version, five mine patrols proceeded to 14 Vein, 23 Position, 1400 Level
underground. On their way, at about 11:00 p.m., the patrols met the respondent’s mine engineer, leadman of the
complainants, escorted by two security guards carrying two sacks of highgrade ore. With headlights off, the patrols went
down the man way and when they reached the apprehension site, they saw the complainants breaking and pulverizing
highgrade ores in the presence of the posted security guard. They observed the highgraders in (sic) five (5) minutes, and
when the lookout miner noticed their presence and warned his companions: Adda tao!" — the mine patrols apprehended
the complainants and recovered from the hands of the complainants were a plastic containing the highgrade ores,
hammers and iron tubes being used in breaking the ores.

"One of the complainants allegedly bribed the apprehending officers (sic) P1,000.00 each to settle the manner (sic), but
the guards refused the offer. Prior to the apprehension, the security guard (SG) on post, SG Freddie Bragado, allegedly
warned the complainants to stop their illegal activity, but the complainants threatened him not to report them otherwise
something would happen to him. Because of the threat, although he was then armed with a shotgun, SG Bragado, the
guard on post and star witness of the respondent, became afraid. SG Bragado just left the complainants commit
highgrading until the mine patrols arrived to apprehend the highgraders. Complainants were investigated, placed on
preventive suspension on November 23, 1981 and subsequently dismissed on December 3, 1981.

"In support of the foregoing allegations, the respondent submitted the sworn statements of Freddie Bragado, joint affidavit
of the apprehending security guards, assay report that the recovered effects are highgrade, information and resolution of
the fiscal and Order of the Municipal Court all showing prima facie case exists against complainants.

"The complainants, on the other hand, have another version. They worked under the supervision of Engr. Melchor
Estonilo and security guards. At about 11:00 p.m., they were ordered to get out, and Engr. Estonilo padlocked their
working place so they proceeded to take a crow’s bath at the palace where they were apprehended. They denied the
allegations of the apprehending security guards and charged them to be more interested in the reward of P100.00 per
apprehension plus 30% percent of the value of the allegedly recovered highgrade. That when they were apprehended, the
guard on post told the patrols why there were effecting the arrest when complainants had not dine anything illegal. That
they were discharged illegally, without any just and valid cause. Hence, these complaints. In support of the foregoing
allegations, they submitted sworn statements including that of SG Bragado" (Rollo, pp. 15-17).

On April 28, 1986, the Labor Arbiter rendered his decision finding that the complainants were illegally dismissed. The
dispositive portion of the decision read:chanrobles virtual lawlibrary

"WHEREFORE, in the light of the foregoing considerations, the respondent is hereby ordered to reinstate the five (5)
complainants to their former respective position without loss of seniority rights with full back wages including ECOLA and
13th month pay for one year and four months, plus full back wages to be counted after the 10th day from receipt of this
decision up to the time of their actual reinstatement. Respondent is also ordered to pay complainants ten" (10%) percent
attorney’s fees of the total amounts (sic) awarded.

"Respondent is finally ordered to present proof of compliance with this Order within ten (10) days from receipt of this
decision" (Rollo, p. 19).

Private respondent appealed the decision of the Labor Arbiter to NLRC. On October 18, 1989, the Third Division of NLRC
affirmed the Labor Arbiter’s decision but limited the award of back wages to three years.

Between the rendition of the decision of the Third Division and the resolution denying the motion for reconsideration, a
change in the membership of the division took place.

Administrative Order No. 161 dated November 18, 1989 of the Secretary of Labor and Employment reorganizes the NLRC
and specified the place of assignment of the newly appointed commissioners. The new commissioners, Presiding
Commissioner Lourdes C. Javier and Commissioner Ireneo B. Bernardo who were assigned to the Third Division,
assumed their posts on November 20, 1989 while Commissioner Rogelio I. Rayala assumed his office on November 15,
1989.

In the motion for reconsideration filed by private respondent, the Third Division, as newly constituted, rendered its
Decision dated November 29, 1990 setting aside the Resolution dated October 18, 1990 and declaring the dismissal from
employment of complainants as valid.

Hence, this petition.

Petitioners claim that their motion for reconsideration should have been resolved by the same members of the Third
Division who rendered the appealed decision.chanrobles law library

We do not agree.

Under Article 213 of the Labor Code of the Philippines, as amended by R.A. No. 6715,." . . Of the five (5) divisions [of the
NLRC], the First and Second Division shall handle cases coming from the National Capital Region and the Third, Fourth
and Fifth Divisions, cases from other parts of Luzon, from the Visayas and Mindanao, respectively. The divisions of the
Commission shall have exclusive appellate jurisdiction over cases with their respective territorial jurisdiction"

Section 2(b), Rule VII of the New Rules of Procedure of NLRC, provides as follows:chanrob1es virtual 1aw library

x x x

"b) Divisions. — Unless otherwise provided by law, the Commission shall exercise its adjudicatory and all other powers,
functions and duties through its five (5) Divisions. Each Division shall consist of one member from the public sector who
shall act as Presiding Commissioner and one member each from the workers and employers sectors, respectively.

"Of the five (5) Divisions, the First and Second Divisions shall have exclusive territorial jurisdiction over appeals of cases
coming form the National Capital Region and they POEA; the Third Division, appealed cases from Luzon (Regions I,
including the Cordillera Administrative Region, II, III, IV except Metro Manila and V); Fourth Division appealed cases from
Visayas (Regions VI, VII and VIII); and, the Fifth Division, appealed cases from Mindanao (Regions IX, X, XI and XII,
including those from the Mindanao Autonomous Region)" (Emphasis supplied).

Since petitioners are from Baguio City, the Third Division of NLRC correctly took cognizance of the appealed case. As
many gleaned from the above-cited rules of NLRC, Baguio City is included in the Cordillera Administrative Region, which
is assigned to the NLRC Third Division. Consequently, the motion for reconsideration filed by petitioners must also be also
be resolved by said Third Division.
The law is clear that the jurisdiction to decide cases appealed to NLRC is vested in the different divisions thereof, not the
individual commissioners assigned to each division. It is thereof of no significance as to who of the commissioners is
functioning in the division at any given time. The only matter of concern is that the Commissioners voting on the motion for
reconsideration were duly assigned to the division. By analogy , in the case of Pamintuan v. Llorente and Dayrit, 29 Phil.
341 (1915), the Supreme Court stated that:jgc:chanrobles.com.ph

". . . In ordinary parlance judges are spoken of as the courts and the courts are referred to, when the person speaking
means the judge simply. It is common for persons, lawyers, and judges, as well as the law, to use these terms
interchangeably. But, notwithstanding that fact, there is an important distinction between them which should be kept in
mind. Courts may exist without a present judge. There may be a judge without a court. The judge may become
disqualified, but such fact does not destroy the court. It simply means that there is no judge to act in the court. The courts
of the Philippine Islands were created and the judges were appointed thereto later. In a few instances, the judges were
appointed before the courts were established. A person may be appointed a judge and be assigned to a particular district
or court subsequently. So it appears that there is an important distinction between the court, as an entity, and the person
who occupies the position of judge" (at pp. 346-347).

Going now the claim that petitioner were illegally dismissed, we find and so hold that substantial evidence exists to
warrant the findings that petitioners were engaged in highgrading.

It is well-established that factual findings of labor administrative officials, if supported by substantial evidence, are entitled
not only to great respect but even to finality (Baguio Colleges Foundation v. National Labor Relations Commission, 222
SCRA 604 [1993]; Capitol Industrial Construction Groups v. National Labor Relations Commission, 221 SCRA 469 [1993).

It is not imperative that all the elements of highgrading or theft of gold as defined by Section 1 of P.D. No. 581 exist to
justify respondent company’s loss of trust and confidence in petitioners.chanrobles virtualawlibrary
chanrobles.com:chanrobles.com.ph

The job of petitioners, as miners, although generally described as menial, is nevertheless, of such nature as to require a
substantial amount of trust and confidence on the part of respondent company. Since there is a reasonable ground to
believe that petitioners committed the crime of highgrading, respondent company is justified in terminating their services.

WHEREFORE, the petition is DISMISSED. The Decision of NLRC dated November 29, 1990 is AFFIRMED.

SO ORDERED.
4. Malayang Samahan ng Manggawa sa Greenfield v. Ramos, 326 SCRA441
G. R. No. 113907 - February 28, 2000

MALAYANG SAMAHAN NG MGA MANGGAGAWA SA M. GREENFIELD (MSMG-UWP), ITS PRESIDENT BEDA

MAGDALENA VILLANUEVA, MARIO DAGANIO, DONATO GUERRERO, BELLA P. SANCHEZ, ELENA TOBIS, RHODA
TAMAYO, LIWAYWAY MALLILIN, ELOISA SANTOS, DOMINADOR REBULLO, JOSE IRLAND, TEOFILA QUEJADA,
VICENTE SAMONTINA, FELICITAS DURIAN, ANTONIO POLDO, ANGELINA TUGNA, SALVADOR PENALOSA,
LUZVIMINDA TUBIG, ILUMINADA RIVERA, ROMULO SUMILANG, NENITA BARBELONIA, LEVI BASILIA, RICARDO
PALAGA, MERCY ROBLES, LEODEGARIO GARIN, DOMINGO ECLARINAL, MELCHOR GALLARDO, MARCELO
GARIN, ROSALINA BAUTISTA, MARY ANN TALIGATOS, ALEJANDRO SANTOS, ANTONIO FRAGA, LUZ GAPULTOS,
MAGDALENA URSUA, EUGENIO ORDAN, LIGAYA MANALO, PEPITO DELA PAZ, PERLITA DIMAQUIAT, MYRNA
VASQUEZ, FLORENTINA SAMPAGA, ARACELI FRAGA, MAXIMINA FAUSTINO, MARINA TAN, OLIGARIO LOMO,
PRECILA EUSEBIO, SUSAN ABOGANO, CAROLINA MANINANG, GINA GLIFONIA, OSCAR SOTTO, CELEDONA
MALIGAYA, EFREN VELASQUEZ, DELIA ANOVER, JOSEPHINE TALIMORO, MAGDALENA TABOR, NARCISA
SARMIENTO, SUSAN MACASIEB, FELICIDAD SISON, PRICELA CARTA, MILA MACAHILIG, CORAZON NUNALA,
VISITACION ELAMBRE, ELIZABETH INOFRE, VIOLETA BARTE, LUZVIMINDA VILLOSA, NORMA SALVADOR,
ELIZABETH BOGATE, MERLYN BALBOA, EUFRECINA SARMIENTO, SIMPLICIA SIMPLICIA BORLEO, MATERNIDAD
DAVID, LAILA JOP, POTENCIANA CULALA, LUCIVITA NAVARRO, ROLANDO BOTIN, AMELITA MAGALONA, AGNES
CENA, NOLI BARTOLAY, DANTE AQUINO, HERMINIA RILLON, CANDIDA APARIJADO, LYDIA JIMENEZ, ELIZABETH
ANOCHE, ALDA MURO, TERESA VILLANUEVA, TERESITA RECUENCO, ELIZA SERRANO, ESTELLA POLINAR,
GERTRUDES NUNEZ, FELIPE BADIOLA, ROSLYN FERNANDEZ, OSCAR PAGUTA, NATIVIDAD BALIWAS,
ELIZABETH BARCIBAL, CYNTHIA ESTELLER, TEODORA SANTOS, ALICIA PILAR, MILA PATENO, GLORIA CATRIZ,
MILA MACAHILIG, ADELAIDA DE LEON, ROSENDO EDILO, ARSENIA ESPIRITU, NUMERIANO CABRERA,
CONCEPSION ARRIOLA, PAULINA DIMAPASOK, ANGELA SANGCO, PRESILA ARIAS, ZENAIDA NUNES, EDITHA
IGNACIO, ROSA GUIRON, TERESITA CANETA, ALICIA ARRO, TEOFILO RUWETAS, CARLING AGCAOILI, ROSA
NOLASCO, GERLIE PALALON, CLAUDIO DIRAS, LETICIA ALBOS, AURORA ALUBOG, LOLITA ACALEN, GREGORIO
ALIVIO, GUILLERMO ANICETA, ANGELIE ANDRADA, SUSAN ANGELES, ISABELITA AURIN, MANUELA AVELINA,
CARLING AGCAOILI, TERESITA ALANO, LOLITA AURIN, EMMABETH ARCIAGA, CRESENCIA ACUNA, LUZVIMINDA
ABINES, FLORENCIA ADALID, OLIVIA AGUSTIN, EVANGELINE ALCORAN, ROSALINA ALFERES, LORNA AMANTE,
FLORENTINA AMBITO, JULIETA AMANONCO, CARMEN AMARILLO, JOSEFINA AMBAGAN, ZENAIDA ANAYA,
MARIA ANGLO, EDITHA ANTA ZO, MARY JANE ANTE, ANDREA AQUINO, ROWENA ARABIT, MARIETA ARAGON,
REBECCA ARCENA, LYDIA ARCIDO, FERNANDO ARENAS, GREGORIO ARGUELLES, EDITHA ARRIOLA, EMMA
ATIENZA, EMMA ATIENZA, TEODY ATIENZA, ELIZABETH AUSTRIA, DIOSA AZARES, SOLIDA AZAINA, MILAGROS
BUAG, MARIA BANADERA, EDNALYN BRAGA, OFELIA BITANGA, FREDISMINDA BUGUIS, VIOLETA
BALLESTEROS, ROSARIO BALLADJAY, BETTY BORIO, ROMANA BAUTISTA, SUSARA BRAVO, LILIA BAHINGTING,
ENIETA BALDOZA, DAMIANA BANGCORE, HERMINIA BARIL, PETRONA BARRIOS, MILAGROS BARRAMEDA,
PERLA BAUTISTA, CLARITA BAUTISTA, ROSALINA BAUTISTA, ADELINA BELGA, CONSOLACION BENAS, MARIA
BEREZO, MERCEDES BEREBER, VIOLETA BISCOCHO, ERNESTO BRIONES, ALVINA BROSOTO, AGUSTINA
BUNYI, CARMEN BUGNOT, ERLINDA BUENAFLOR, LITA BAQUIN, CONSEJO BABOL, CRISANTA BACOLOD, CELIA
DE BACTAT, MAZIMA BAGA, ELENA BALADAD, ROSARIO BALADJAY, AMALIA BALAGTAS, ANITA BALAGTAS,
MARIA BALAKIT, RUFINA BALATAN, REBECCA BALDERAMA, AMELIA BALLESTER, BELEN BARQUIO,
BERNANDITA BASILIDES, HELEN BATO, HELEN BAUTISTA, ROMANA BAUTISTA, ALMEDA BAYTA, AVELINA
BELAYON, NORMA DE BELEN, THELMA DE BELEN, JOCELYN BELTRAN, ELENA BENITEZ, VIRGINIA
BERNARDINO, MERLINA BINUYAG, LINA BINUYA, BLESILDA BISNAR, SHIRLEY BOLIVAR, CRESENTACION
MEDLO, JOCELYN BONIFACIO, AMELIA BORBE, AMALIA BOROMEO, ZENAIDA BRAVO, RODRIGO BEULDA,
TERESITA MENDEZ, ELENA CAMAN, LALIANE CANDELARIA, MARRY CARUJANO, REVELINA CORANES,
MARITESS CABRERA, JUSTINA CLAZADA, APOLONIA DELA CRUZ, VICTORIA CRUZ, JOSEFINA DELA CRUZ,
MARITESS CATANGHAL, EDNA CRUZ, LUCIA DE CASTRO, JOSIE CARIASO, OFELIA CERVANTES, MEDITA
CORTADO, AMALIA CASAJEROS, LUCINA CASTILIO, EMMA CARPIO, ANACORITA CABALES, YOLANDA CAMO,
MILA CAMAZUELA, ANITA CANTO, ESTELA CANCERAN, FEMENCIA CANCIO, CYNTHIA CAPALAD, MERLE
CASTILLO, JESUSA CASTRO, CECILIA CASTILLO, SILVERITA CASTRODES, VIVIAN CELLANO, NORMA CELINO,
TERESITA CELSO, GLORIA COLINA, EFIPANIA CONSTANTINO, SALVACION CONSULTA, MEDITA CORTADO,
AIDA CRUZ, MARISSA DELA CRUZ, EDITO CORCILLES, JELYNE CRUZ, ROSA CORPOS, ROSITA CUGONA, ELSIE
CABELLES, EMMA CADUT, VICTORIA CALANZA, BARBARA CALATA, IMELDA CALDERON, CRISTINA CALIDGUID,
EMMALINDA CAMALON, MARIA CAMERINO, CARMENCITA CAMPO, CONNIE CANEZO, LOURDES CAPANANG,
MA. MILAGROS CAPILI, MYRNA T. CAPIRAL, FLOR SAMPAGA, SUSAN B. CARINO, ROSARIO CARIZON, VIRGINIA
DEL CARMEN, EMMA CARPIO, PRESCILA CARTA, FE CASERO, LUZ DE CASTRO, ANNA CATARONGAN,
JOSEFINA CASTISIMO, JOY MANALO, EMMIE CAWALING, JOVITA CARA, MARINA CERBITO, MARY CAREJANO,
ESTELA R. CHAVEZ, CONCEPCION PARAJA, GINA CLAUDIO, FLORDELIZA CORALES, EDITO CORCIELER, ROSA
C. CORROS, AMELIA CRUZ, JELYNE CRUZ, WILFREDO DELA CRUZ, REINA CUEVAS, MARILOU DEJECES,
JOSEPHINE DESACULA, EDITHA DEE, EDITHA DIAZ, VIRGIE DOMONDON, CELSA DOROPAW, VIOLETA
DUMELINA, MARIBEL DIMATATAC, ELBERTO DAGANIO, LETECIA DAGOHOY, DINDO DALUZ, ANGELITA DANTES,
GLORIA DAYO, LUCIA DE CASTRO, CARLITA DE GUZMAN, CARMEN DELA CRUZ, MERCY DE LEON, MARY
DELOS REYES, MARIETA DEPILO, MATILDE DIBLAS, JULIETA DIMAYUGA, TEODORA DIMAYUGA, YOLANDA
DOMDOM, LUCITA DONATO, NELMA DORADO, RITA DORADO, SUSAN DUNTON, HERMINIA SAN ESTEBAN,
AMALI EUGENIO, OLIVIA EUSOYA, ERNESTO ESCOBIN, EVELYN ESCUREL, LYDIA ESCOBIN, VICENTE E.
ELOIDA. ELENA EGAR, GLORIA ERENO, NORMA ESPIRIDION, ARSENIA ESPIRITU, AURORA ESTACIO,
DEMETRIA ESTONELO, MILAGROS FONSEGA, LYDIA FLORENTINO, JULIA FARABIER, TRINIDAD FATALLA,
IMELDA FLORES, JESSINA FRANCO, MA. CRISTINA FRIJAS, ESPECTACION FERRER, BERDENA FLORES,
LEONILA FRANCISCO, BERNARDA FAUSTINO, DOLORES FACUNDO, CRETITA FAMILARAN, EMELITA FIGUERAS,
MA. VIRGINIA FLORENDO, AURORA FRANCISCO, MA. JESUSA FRANCISCO, NENITA FUENTES, MARILOU
GOLINGAN, JUANITA GUERRERO, LYDIA GUEVARRA, SOCORRO GONZAGA, PATRICIA GOMEO, ROSALINDA
GALAPIN, CARMELITA GALVEZ, TERESA GLE, SONIA GONZALES, PRIMITA GOMEZ, THERESA GALUA, JOSEFINA
GELUA, BRENDA GONZAGA, FLORA GALLARDO, LUCINDA GRACILLA, VICTORIA GOZUM, NENITA GAMAO, EDNA
GARCIA, DANILO GARCIA, ROSARIO GIRAY, ARACELI GOMEZ, JOEMARIE GONZAGA, NELIA GONZAGA, MARY
GRANCE GOZON, CARMEN GONZALES, MERLITA GREGORIO, HERMINIA GONZALES, CARLITA DE GUZMAN,
MODESTA GABRENTINA, EDITHA GADDI, SALVACIO GALIAS, MERLINDA GALIDO, MELINDA GAMIT, JULIETA
GARCIA, EMELITA GAVINO, CHARITO GILLIA, GENERA GONEDA, CRESTITA GONZALES, FRANCISCA GUILING,
JULIAN HERNANDEZ, HERRADURA, SUSANA HIPOLITO, NERISSA HAZ, SUSAN HERNAEZ, APOLONIA ISON,
SUSAN IBARRA, LUDIVINA IGNACIO, CHOLITA INFANTE, JULIETA ITURRIOS, ANITA IBO, MIRASOL INGALLA,
JULIO JARDINIANO, MERLITA JULAO, JULIETA JULIAN, MARIBETH DE JOSE, JOSEPHINE JENER, IMELDA JATAP,
JULIETA JAVIER, SALOME JAVIER, VICTORIA JAVIER, SALVACION JOMOLO, EDNA JARNE, LYDIA JIMENEZ,
TERESITA DE JUAN, MARILYN LUARCA, ROSITA LOSITO, ROSALINA LUMAYAG, LORNA LARGA, CRESTETA DE
LEON, ZENAIDA LEGASPI, ADELAIDA LEON, IMELDA DE LEON, MELITINA LUMABI, LYDIA LUMABI, ASUNCION
LUMACANG, REGINA LAPIADRIO, MELANIA LUBUGUAN, EVANGELINE LACAP, PELAGIA LACSI, LORNA LAGUI,
VIRGIE LAITAN, VIRGINIA LEE, CRESTELITA DE LEON, FELICISIMA LEONERO, DIOSA LOPE, ANGELITA LOPEZ,
TERESITA LORICA, JUANITA MENDIETA, JUANITA MARANQUEZ, JANET MALIFERO, INAS MORADOS, MELANIE
MANING, LUCENA MABANGLO, CLARITA MEJIA, IRENE MENDOZA, LILIA MORTA, VIGINIA MARAY, CHARITO
MASINAHON, FILMA MALAYA, LILIA MORTA, VIRGINIA MARAY, CHARITO MASINAHON, FILMA MALAYA, LILIA
MORTA, ROSITA MATIBAG, LORENZA MLINA, SABINA DEL MUNDO, EDITHA MUYCO, NARCISA MABEZA, MA. FE
MACATANGAY, CONCEPCION MAGDARAOG, IMELDA MAHIYA, ELSA MALLARI, LIGAYA MANAHAN, SOLEDA
MANLAPAS, VIRGINIA MAPA, JOSEI MARCOS, LIBRADA MARQUEZ, VIRGINIA MAZA, JULIANITA MENDIETA,
EDILBERTA MENDOZA, IRENE MERCADO, HELEN MEROY, CRISTINA MEJARES, CECILIA MILLET, EMELITA
MINON, JOSEPHINE MIRANA, PERLITA MIRANO, EVANGELINE MISBAL, ELEANOR MORALES, TERESITA
MORILLA, LYDIA NUDO, MYRIAM NAVAL, CAROLINA NOLIA, ALICIA NUNEZ, MAGDALENA NAGUIDA, ELSA NICOL,
LILIA NACIONALES, MA. LIZA MABO, REMEDIOS NIEVES, MARGARITA NUYLAN, TERESITA NIEVES, PORFERIA
NARAG, RHODORA NUCASA, CORAZON OCRAY, LILIA OLIMPO, VERONA OVERENCIA, FERMIN OSENA,
FLORENCIA OLIVAROS, SOLEDAD OBEAS, NARISSA OLIVEROS, PELAGIA ORTEGA, SUSAN ORTEGA, CRISTINA
PRENCIPE, PURITA PENGSON, REBECCA PACERAN, EDNA PARINA, MARIETA PINAT, EPIFANIA PAJERLAN,
ROSALINA PASIBE, CECILIA DELA PAZ, LORETA PENA, APOLONIA PALCONIT, FRANCISCO PAGUIO, LYDIA
PAMINTAHON, ELSIE PACALDO, TERESITA PADILLA, MYRNA PINEDA, MERCEIDTA PEREZ, NOVENA PORLUCAS,
TERESITA PODPOD, ADORACION PORNOBI, ALICIA PERILLO, HELEN JOY PENDAL, LOURDES PACHECO,
LUZVIMINDA PAGALA, LORETA PAGAPULAN, FRANCISCO PAGUIO, PRISCO PALACA, FLORA PAMINTUAN,
NOEMI PARISALES, JOSEPHINE PATRICIO, CRISTINA PE BENITO, ANGELA PECO, ANGELITA PENA, ESTER
PENONES, NORMA PEREZ, MAURA PERSEVERANCIA, MARINA PETILLA, JOSIE PIA, ZULVILITA PIODO,
REBECCA PACERAN, CLARITA POLICARPIO, MAXIMO POTENTO, PORFIRIO POTENTO, FLORDELIZA PUMARAS,
FERNANDO QUEVEDO, JULIANA QUINDOZA, CHARITO QUIROZ, CARMELITA ROSINO, RODELIA RAYONDOYON,
FLORENCIA RAGOS, REBECCA ROSALES, ROSALYN RIVERO, FRANCISCO RUIZ, FRANCIA ROSERO, EMELY
RUBIO, EDILBERTO RUIO, JUANA RUBY, RAQUEL REYES, MERCY ROBLES, ESTELA RELANO, ROSITA REYES
NIMFA RENDON, EPIFANIO RAMIRO, MURIEL REALCO, BERNARDITA RED, LEONITA RODIL, BENITA REBOLA,
DELMA REGALARIO, LENY REDILLAS, JULIETA DELA ROSA, FELICITAS DELA ROSA, SUSAN RAFALLO, ELENA
RONDINA, NORMA RACELIS, JOSEPHINE RAGEL, ESPERANZA RAMIREZ, LUZVIMINDA RANADA, CRISTINA
RAPINSAN, JOCELYN RED, ORLANDO REYES, TERESITA REYES, ANGELITA ROBERTO, DELIA ROCHA,
EDLTRUDES ROMERO, MELECIA ROSALES, ZENAIDA ROTAO, BELEN RUBIS, FE RUEDA, SYLVIA
SONGCAYAWON, CRISTINA SANANO, NERCISA SARMIENTO, HELEN SIBAL, ESTELITA SANTOS, NORMA
SILVESTRE, DARLITA SINGSON, EUFROCINA SARMIENTO, MYRNA SAMSON, EMERLINA SADIA, LORNA
SALAZAR, AVELINA SALVADOR, NACIFORA SALAZAR, TITA SEUS, MARIFE SANTOS, GRACIA SARMIENTO,
ANGELITA SUMANGIL, ELIZABETH SICAT, MA. VICTORIA SIDELA, ANALITA SALVADOR, MARITES SANTOS,
VIRGINIA SANTOS, THELMA SARONG, NILDA SAYAT, FANCITA SEGUNDO, FYNAIDA SAGUI, EDITHA SALAZAR,
EDNA SALZAR, EMMA SALENDARIO, SOLEDAD SAMSON, EDNA SAN DIEGO, TERESITA SAN GABRIEL,
GERTRUDES SAN JOSE, EGLECERIA OSANCHEZ, ESTRELLA SANCHEZ, CECILIA DELOS SANTOS, LUISA
SEGOVIA, JOCELYN SENDING, ELENA SONGALIA, FELICITAS SORIANO, OFELIA TIBAYAN, AIDA TIRNIDA,
MONICA TIBAYAN, CRISTETA TAMBARAN, GLORIA TACDA, NENVINA, FELINA TEVES, ANTONINA DELA TORRE,
MAXIMA TANILON, NENA TABAT, ZOSIMA TOLOSA, MARITA TENOSO, IMELDA TANIO, LUZ TANIO, EVANGELINE
TAYO, JOSEFINA TINGTING, ARSENIA TISOY, MAGDALENA TRAJANO, JOSEFINA UBALDE, GINA UMALI, IRMA
VALENZUELA, FELY VALDEZ, PAULINA VALEZ, ROSELITA VALLENTE, LOURDES VELASCO, AIDA VILLA,
FRANCISCA VILLARITO, ZENAIDA VISMONTE, DELIA VILLAMIEL, NENITA VASQUEZ, JOCELYN VILLASIS,
FERMARGARITA VARGAS, CELIA VALLE, MILA CONCEPCION VIRAY, DOMINGA VALDEZ, LUZVIMINDA VOCINA,
MADELINE VIVERO, RUFINA VELASCO, AUREA VIDALEON, GLORIA DEL VALLE, THELMA VALLOYAS, CYNTHIA
DELA VEGA, ADELA VILLAGOMEZ, TERESITA VINLUAN, EUFEMIA VITAN, GLORIA VILLAFLORES, EDORACION
VALDEZ, ANGELITA VALDEZ, ILUMINADA VALENCI, MYRNA VASQUEZ, EVELNYN VEJERAMO, TEODORA
VELASQUEZ, EDAN VILLANUEVA, PURITA VILLASENOR, SALVADOR WILSON, EMELINA YU, ADELFA YU, ANA
ABRIGUE, VIRGINIA ADOBAS, VICTORIA ANTIPUESTO, MERCEDITA CASTILLO, JOCELYN CASTRO, CREMENIA
DELA CRUZ, JOSEPHINE IGNACIO, MELITA ILILANGOS, LIGAYA LUMAYAT, DELIA LUMBES, ROSITA LIBRADO,
DELIA LAGRAMADA, GEMMA MAGPANTAY, EMILY MENDOZA, FIDELA PANGANIBAN, LEONOR RIZALDO,
ILUMINDA RIVERA, DIVINA SAMBAYAN, ELMERITA SOLAYAO, NANCY SAMALA, JOSIE SUMARAN, LUZVIMINDA
ABINES, ALMA ACOL, ROBERTO ADRIATICO, GLORIA AGUINALDO, ROSARIO ALEYO, CRISTETA ALEJANDRO,
LILIA ALMOGUERA, CARMEN AMARILLO, TRINIDAD ARDANIEL, CERINA AVENTAJADO, ZENAIDA AVAYA, LOLITA
ARABIS, MARIA ARSENIA, SOFIA AGUINALDO, SALVE ABAD, JOSEFINA AMBANGAN EMILIA AQUINO, JOSEFINA
AQUINO, JULIANA AUSAN, AMERCIANA ACOSTA, CONCEPCION ALEROZA, DIANA ADOVOS, FELY ADVINCULA,
SEOMINTA ARIAS, JOSEPHINE ARCEDE, NORMA AMISTOSO, PRESENTACION ALONOS, EMMA ATIENZA,
LEONIDA AQUINO, ANITA ARILLON, ADELAIDA ARELLANO, NORMA AMISTOSO, JOSEPHINE ARCEDE,
SEMIONITA ARIAS, JOSEFINA BANTUG, LOLITA BARTE, HERMINIA BASCO, MARGARITA BOTARDO, RUFINO
BUGNOT, LOLITA BUSTILLO, ISABEL BALAKIT, ROSARIO BARRERO, TESSIE BALBOS, NORMA BENISANO,
GUILLERMA BRUGES, BERNADETTE BARTOLOME, SHIRLEY BELMONTE, MERONA BELZA, AZUCENA
BERNALES, JOSE BASCO, NIMPHA BANTOG, BENILDA BUBAN, REGINA BUBAN, SALOME BARRAMEDA, IRENE
BISCO, FELICITAS BAUTISTA, VIOLETA BURA, LINA BINUYA, BIBIANA BAARDE, ELSA BAES, ANASTACIA
BELONZO, SONIA BENOYO, ELIZABETH BACUNGAN, PATRICIA BARRAMEDA, ERLINDA BARCELONA, EMMA
BANICO, APOLONIA BUNAO, LUCITA BOLEA, PACIFICA BARCELONA, EDITHA BASIJAN, RENITA BADAMA, ELENA
BALADAD, CRESENCIA BAJO, BERNADITA BASILID, MELINDA BEATO, YOLANDA BATANES, EDITHA BORILLA,
ANITA BAS, ELSA CALIPUNDAN, MARIA CAMERINO,VIRGINIA CAMPOSANO, MILAGROS CAPILI, CARINA CARINO,
EUFEMIA CASIHAN, NENITA CASTRO, FLORENCIA CASUBUAN, GIRLIE CENTENO, MARIANITA CHIQUITO,
IMELDA DELA CRUZ, TEODOSIA GONG, TEOFILA CARACOL, TERESITA CANTA, IRENEA CUNANAN, JULITA
CANDILOSAS, VIOLETA CIERES, MILAGROS DELA CRUZ, FLOREPES CAPULONG, CARMENCITA CAMPO,
MARILYN CARILLO, RUTH DELA CRUZ, RITA CIJAS, LYDIA CASTOR, VIRGIE CALUBAD, EMELITA CABERA,
CRISTETA CRUZ, ERLINDA COGADAS, IMELDA CALDERON, SUSIE LUZ CEZAR, ESTELA CHAVEZ, NORMA
CABRERA, ELDA DAGATAN, LEONISA DIMACUNA, ERNA DUGTONG, FLORDELISA DIGMA, VIRGILIO DADIOS,
LOLITA DAGTA, ADELAIDA DORADO, CELSA DATUMANONG, VIRGINIA DOCTOLERO, EDNA SAN DIEGO, JULIETA
DANG, JULIETA DORANTINAO, LOLITA DAGANO, JUDITH DIAZ, MARIA ENICANE, MARITA ESCARDE, ENRIMITA
ESMAYOR, ROSARIO EPIRITU, REMEDIOS EMBOLTORIO, IRENE ESTUITA, TERESITA ERESE, ERMELINDA
ELEZO, MARIA ESTAREJA, MERLITA ESQUERRA, YOLANDA FELICITAS, FRUTO FRANCIA, MARTHA FRUTO, LILIA
FLORES, SALVACION FORTALESA, JUDITH FAJARDO, SUSANA FERNANDO, EDWIN FRANCISCO, NENITA
GREGORY, ROSA CAMILO, MARIVIC GERRARDO, CHARITA GOREMBALEM, NORMA GRANDE, DOLORES
GUTIERREZ, CHARLIE GARCIA, LUZ GALVEZ, ADELAIDA GAMILLA, LUZ GAPULTOS, ERLINDA GARCIA, HELEN
GARCIA, ERLINDA GAUDIA, FRANCISCA GUILING, MINTA HERRERA, ASUNCION HONOA, JUAN HERNANDEZ,
LUCERIA ANNA MAE HERNANDEZ, JULIANA HERNANDEZ, EDITHA IGNACIO, ANITA INOCENCIO, EULALIA
INSORIO, ESTELITA IRLANDA, MILAGROS IGNACIO, LINDA JABONILLO, ADELIMA JAEL, ROWENA JARABJO,
ROBERT JAVILINAR, CLARITA JOSE, CARMENCITA JUNDEZ, SOFIA LALUCIS, GLORIA LABITORIA, ANGELITA
LODES, ERLINDA LATOGA, EVELYN LEGASPI, ROMEO LIMCHOCO, JESUS LARA, ESTRELLA DE LUNA, LORETA
LAREZA, JOSEPHINE ALSCO, MERCY DE LEON, CONSOLACION LIBAO, MARILYN LIWAG, TERESITA LIZAZO,
LILIA MACAPAGAL, SALVACION MACAREZA, AMALIA MADO, TERESITA MADRIAGA, JOVITA MAGNAYE, JEAN
MALABAD, FRANCISCA MENDOZA, NELCITA MANGANTANG, TERESITA NELLA, GENEROZA MERCADO,
CRISTETA MOJANA, BERNARDA MONGADO, LYDIA MIRANDA, ELISA MADRILEJOS, LOIDA MAGSINO, AMELIA
MALTO, JULITA MAHIBA, MYRNA MAYORES, LUISA MARAIG, FLORENCIA MARAIG, EMMA MONZON, IMELDA
MAGDANGAN, VICTORIA MARTIN, NOEMI MANGUILLO, BASILIZA MEDINA, VICTORIO MERCADO, ESTELA
MAYPA, EMILIA MENDOZA, LINA MAGPANTAY, FELICIANA MANLOLO, ELENA MANACOP, WILMA MORENO,
JUANA MENDOZA, EVELYN DEL MUNDO, ROSIE MATUTINA, MATILDE MANALO, TERESITA MENDEZ, FELIPINA
MAGONCIA, MARIA MANZANO, LIGAYA MANALO, LETICIA MARCHA, MARINA MANDIGMA, LETICIA MANDASOC,
PRESCILLA MARTINEZ, JULIA MENDOZA, PACITA MAGALLANES, ANGELINA MARJES, SHIRLEY MELIGRITO,
IRENE MERCADO, ELISA MAATUBANG, MARCELINA NICOLAS, AGUSTINA NICOLAS, ROSA NOLASCO, WILMA
NILAYE, VIOLETA ORACION, ANGELA OSTAYA, JUANITA OSAYOS, MAGDALENA OCAMPO, MARDIANA OCTA,
ROSELA OPAO, LIBRADA OCAMPO, YOLANDA OLIVER, MARCIA ORLANDA, PAGDUNAN, RITA PABILONA, MYRA
PALACA, BETHLEHEM PALINES, GINA PALIGAR, NORMA PALIGAR, DELMA PEREZ, CLAUDIA PRADO, JULIE
PUTONG, LUDIVINA PAGSALINGAN, MERLYN PANALIGAN, VIOLETA PANAMBITAN, NOREN PAR, ERLINDA
PARAGAS, MILA PARINO, REBECCA PENAFLOR, IMELDA PENAMORA, JERMICILLIN PERALTA, REBECCA
PIAPES, EDITHA PILAR, MAROBETH PILLADO, DIOSCORO PIMENTEL, AURORA LAS PINAS, EVANGELINA PINON,
MA. NITA PONDOC, MA. MERCEDES PODPOD, ANGELITO PANDEZ, LIGAYA PIGTAIN, LEONILA QUIAMBAO,
ELENA QUINO, MARITESS QUIJANO, CHOLITA REBUENO, LOLITA REYES, JOCELYN RAMOS, ROSITA RAMIREZ,
ELINORA RAMOS, ISABEL RAMOS, ANNABELLE RESURRECCION, EMMA REYES, ALILY ROXAS, MARY GRACE
DELOS REYES, JOCELYN DEL ROSARIO, JOSEFINA RABUSA, ANGELITA ROTAIRO, SAMCETA ROSETA,
EDERLINA RUIZ, ZENAIDA ROSARIO, BENITA REBOLA, ROSITA REVILLA, ROSITA SANTOS, ROWENA SALAZAR,
EMILYN SARMIENTO, ANA SENIS, ELOISA SANTOS, NARCISA SONGLIAD, ELMA SONGALIA, AMPARA SABIO,
JESSIE SANCHEZ, VIVIAN SAMILO, GLORIA SUMALINOG, ROSALINA DELOS SANTOS, MARIETA SOMBRERO,
HELEN SERRETARIO, TEODORO SULIT, BELLA SONGUINES, LINDA SARANTAN, ESTELLA SALABAR, MILAGROS
SISON, GLORIA TALIDAGA, CECILIA TEODORO, ROMILLA TUAZON, AMELITA TABULAO, MACARIA TORRES,
LUTGARDA TUSI, ESTELLA TORREJOS, VICTORIA TAN, MERLITA DELA VEGA, WEVINA ORENCIA, REMEDIOS
BALECHA, TERESITA TIBAR, LACHICA LEONORA, JULITA YBUT, JOSEFINA ZABALA, WINNIE ZALDARIAGA,
BENHUR ANTENERO, MARCELINA ANTENERO, ANTONINA ALAPAN, EDITHA ANTOZO, ROWENA ARABIT, ANDRA
AQUINO, TERESITA ANGULO, MARIA ANGLO, MYRNA ALBOS, ELENITA AUSTRIA, ANNA ABRIGUE, VIRGINIA
ADOBAS, VICTORIA ANTIPUESTO, REMEDIOS BOLECHE, MACARIA BARRIOS, THELMA BELEN, ESTELLA
BARRETTO, JOCELYN CHAVEZ, VIRGINIA CAPISTRANO, BENEDICTA CINCO, YOLLY CATPANG, REINA CUEVAS,
VICTORIA CALANZA, FE CASERO, ROBERTA CATALBAS, LOURDES CAPANANG, CLEMENCIA CRUZ, JOCELYN
COSTO, MERCEDITA CASTILLO, EDITHA DEE, LUCITA DONATO NORMA ESPIRIDION, LORETA FERNANDEZ,
AURORA FRANCISCO, VILMA FAJARDO, MODESTA GABRENTINA, TERESITA GABRIEL, SALVACION GAMBOA,
JOSEPHINE IGNACIO, SUSAN IBARRA, ESPERANZA JABSON, OSCAR JAMBARO, ROSANNA JARDIN, CORAZON
JALOCON, ZENAIDA LEGASPI, DELLA LAGRAMADA, ROSITA LIBRANDO, LIGAYA LUMAYOT, DELIA LUMBIS,
LEONORA LANCHICA, RELAGIA LACSI, JOSEFINA LUMBO, VIOLETA DE LUNA, EVELYN MADRID, TERESITA
MORILLA, GEMMA MAGPANTAY, EMILY MENDOZA, IRENEA MEDINA, NARCISA MABEZA, ROSANNA MEDINA,
DELIA MARTINEZ, ROSARIO MAG-ISA, EDITHA MENDOZA, EDILBERTA MENDOZA, FIDELA PANGANIBAN, OFELIA
PANGANIBAN, AZUCENA POSTGO, LOURDES PACHECO, LILIA PADILLA, MARISSA PEREZ, FLORDELIZA
PUMARES, LUZ REYES, NORMA RACELIS, LEONOR RIZALDO, JOSIE SUMASAR, NANCY SAMALA, EMERLITA
SOLAYAO, MERCEDITA SAMANIEGO, BLANDINA SIMBULAN, JOCELYN SENDING, LUISITA TABERRERO,
TERESITA TIBAR, ESTERLINA VALDEZ, GLORIA VEJERANO, ILUMINADA VALENCIA, MERLITA DELA VEGA,
VIRGIE LAITAN, JULIET VILLARAMA, LUISISTA OCAMPO, NARIO ANDRES, ANSELMA TULFO, GLORIA MATEO,
FLANIA MENDOZA, CONNIE CANGO, EDITHA SALAZAR, MYRNA DELOS SANTOS, TERESITA SERGIO, CHARITO
GILLA, FLORENTINA HERNAEZ, BERNARDINO VIRGINIA, AMPO ANACORITA, SYLVIA POASADAS, ESTRELLA
ESPIRITU, CONCORDIA LUZURIAGA, MARINA CERBITO, EMMA REYES, NOEMI PENISALES, CLARITA
POLICARPIO, BELEN BANGUIO, HERMINIA ADVINCULA, LILIA MORTA, REGINA LAPIDARIO, LORNA LARGA,
TERESITA VINLUAN, MARITA TENOSO, NILDS SAYAT, THELMA SARONG, DELMA REGALIS, SUSAN RAFAULO,
ELENA RONDINA, MYRNA PIENDA, VIOLETA DUMELINA, FLORENCIA ADALID, FILMA MELAYA, ERLINDA DE
BAUTISTA, MATILDE DE BLAS, DOLORES FACUNDO, REBECCA LEDAMA, MA. FE MACATANGAY, EMELITA
MINON, NORMA PAGUIO, ELIZA VASQUEZ, GLORIA VILLARINO, MA. JESUS FRANCISCO, TERESITA GURPIDO,
LIGAYA MANALO, FE PINEDA, MIRIAM OCMAR, LUISA SEGOVIA, TEODY ATIENZA, SOLEDA AZCURE, CARMEN
DELA CRUZ, DMETRIA ESTONELO, MA. FLORIDA LOAZNO, IMELDA MAHIYA, EDILBERTA MENDOZA, SYLVIA
POSADAS, SUSANA ORTEGA, JOSEPHINE D. TALIMORO, TERESITA LORECA, ARSENIA TISOY, LIGAYA MANALO,
TERESITA GURPIO, FE PINEDA, and MARIA JESUS FRANCISCO, Petitioners, v. HON. CRESENCIO J. RAMOS,
NATIONAL LABOR RELATIONS COMMISSION, M. GREENFIELD (B), INC., SAUL TAWIL, CARLOS T. JAVELOSA,
RENATO C. PUANGCO, WINCEL LIGOT, MARCIANO HALOG, GODOFREDO PACENO, SR., GERVACIO
CASILLANO, LORENZO ITAOC, ATTY. GODOFREDO PACENO, JR., MARGARITO CABRERA, GAUDENCIO RACHO,
SANTIAGO IBANEZ, AND RODRIGO AGUILING, Respondents.

PURISIMA, J.:
At bar is a Petition for Certiorari under Rule 65 of the Revised Rules of Court to annul the decision of the National Labor
Relations Commission in an unfair labor practice case instituted by a local union against its employer company and the
officers of its national federation.

The petitioner, Malayang Samahan ng mga Manggagawa sa M. Greenfield, Inc., (B) (MSMG), hereinafter referred to as
the "local union", is an affiliate of the private respondent, United Lumber and General Workers of the Philippines
(ULGWP), referred to as the "federation". The collective bargaining agreement between MSMG and M. Greenfield, Inc.,
names the parties as follows:

This agreement made and entered into by and between:

M. GREENFIELD, INC. (B) a corporation duly organized in accordance with the laws of the Republic of the Philippines
with office address at Km. 14, Merville Road, Parañaque, Metro Manila, represented in this act by its General manager,
Mr. Carlos T. Javelosa, hereinafter referred to as the Company;

-and-

MALAYANG SAMAHAN NG MGA MANGGAGAWA SA M. GREENFIELD (B) (MSMG)/UNITED LUMBER AND

GENERAL WORKERS OF THE PHILIPPINES (ULGWP), a legitimate labor organization with address at Suite 404, Trinity
Building, T. M. Kalaw Street, Manila, represented in this act by a Negotiating Committee headed by its National President,
Mr. Godofredo Paceno, Sr., referred to in this Agreement as the UNION.1

The CBA includes, among others, the following pertinent provisions:

Art. II-Union Security

Sec. 1. Coverage andope. All employees who are covered by this Agreement and presently members of the UNION shall
remain members of the UNION for the duration of this Agreement as a condition precedent to continued employment with
the COMPANY.

xxx-xxx-xxx

Sec. 4. Dismissal. Any such employee mentioned in Section 2 hereof, who fails to maintain his membership in the UNION
for non-payment of UNION dues, for resignation and for violation of UNION's Constitution and By-Laws and any new
employee as defined in Section 2 of this Article shall upon written notice of such failure to join or to maintain membership
in the UNION and upon written recommendation to the COMPANY by the UNION, be dismissed from the employment by
the COMPANY; provided, however, that the UNION shall hold the COMPANY free and blameless from any and all
liabilities that may arise should the dismissed employee question, in any manner, his dismissal; provided, further that the
matter of the employee's dismissal under this Article may be submitted as a grievance under Article XIII and, provided,
finally, that no such written recommendation shall be made upon the COMPANY nor shall COMPANY be compelled to act
upon any such recommendation within the period of sixty (60) days prior to the expiry date of this Agreement conformably
to law.

Art. IX

Sec. 4. Program Fund The Company shall provide the amount of P10,000.00 a month for a continuing labor education
program which shall be remitted to the Federation . . .2

On September 12, 1986, a local union election was held under the auspices of the ULGWP wherein the herein petitioner,
Beda Magdalena Villanueva, and the other union officers were proclaimed as winners. Minutes of the said election were
duly filed with the Bureau of Labor Relations on September 29, 1986.

On March 21, 1987, a Petition for Impeachment was filed with the national federation ULGWP by the defeated candidates
in the aforementioned election.

On June 16, 1987, the federation conducted an audit of the local union funds. The investigation did not yield any
unfavorable result and the local union officers were cleared of the charges of anomaly in the custody, handling and
disposition of the union funds.

The 14 defeated candidates filed a Petition for Impeachment/Expulsion of the local union officers with the DOLE NCR on
November 5, 1987, docketed as NCR-OD-M-11-780-87. However, the same was dismissed on March 2, 1988, by Med-
Arbiter Renato Parungo for failure to substantiate the charges and to present evidence in support of the allegations.

On April 17, 1988, the local union held a general membership meeting at the Caruncho Complex in Pasig. Several union
members failed to attend the meeting, prompting the Executive Board to create a committee tasked to investigate the non-
attendance of several union members in the said assembly, pursuant to Sections 4 and 5, Article V of the Constitution and
By-Laws of the union, which read:

Seksyon 4. Ang mga kinukusang hindi pagdalo o hindi paglahok sa lahat ng hakbangin ng unyon ng sinumang kasapi o
pinuno ay maaaring maging sanhi ng pagtitiwalag o pagpapataw ng multa ng hindi hihigit sa P50.00 sa bawat araw na
nagkulang.

Seksyon 5. Ang sinumang dadalo na aalis ng hindi pa natatapos ang pulong ay ituturing na pagliban at maparusahan
itong alinsunod sa Article V, Seksyong 4 ng Saligang Batas na ito. Sino mang kasapi o pisyales na mahuli and dating sa
takdang oras ng di lalampas sa isang oras ay magmumulta ng P25.00 at babawasin sa sahod sa pamamagitan ng salary
deduction at higit sa isang oras ng pagdating ng huli ay ituturing na pagliban.3
On June 27, 1988, the local union wrote respondent company a letter requesting it to deduct the union fines from the
wages/salaries of those union members who failed to attend the general membership meeting. A portion of the said letter
stated:

xxx-xxx-xxx

In connection with Section 4 Article II of our existing Collective Bargaining Agreement, please deduct the amount of
P50.00 from each of the union members named in said annexes on the payroll of July 2-8, 1988 as fine for their failure to
attend said general membership meeting.4

In a Memorandum dated July 3, 1988, the Secretary General of the national federation, Godofredo Paceño, Jr.
disapproved the resolution of the local union imposing the P50.00 fine. The union officers protested such action by the
Federation in a Reply dated July 4, 1988.

On July 11, 1988, the Federation wrote respondent company a letter advising the latter not to deduct the fifty-peso fine
from the salaries of the union members requesting that:

. . . any and all future representations by MSMG affecting a number of members be first cleared from the federation before
corresponding action by the Company.5

The following day, respondent company sent a reply to petitioner union's request in a letter, stating that it cannot deduct
fines from the employees' salary without going against certain laws. The company suggested that the union refer the
matter to the proper government office for resolution in order to avoid placing the company in the middle of the issue.

The imposition of P50.00 fine became the subject of bitter disagreement between the Federation and the local union
culminating in the latter's declaration of general autonomy from the former through Resolution No. 10 passed by the local
executive board and ratified by the general membership on July 16, 1988.

In retaliation, the national federation asked respondent company to stop the remittance of the local union's share in the
education funds effective August 1988. This was objected to by the local union which demanded that the education fund
be remitted to it in full.

The company was thus constrained to file a Complaint for Interpleader with a Petition for Declaratory Relief with the Med-
Arbitration Branch of the Department of Labor and Employment, docketed as Case No. OD-M-8-435-88. This was
resolved on October 28, 1988, by Med-Arbiter Anastacio Bactin in an Order, disposing thus:

WHEREFORE, premises considered, it is hereby ordered:

1. That the United Lumber and General Workers of the Philippines (ULGWP) through its local union officers shall
administer the collective bargaining agreement (CBA).

2. That petitioner company shall remit the P10,000.00 monthly labor education program fund to the ULGWP subject to the
condition that it shall use the said amount for its intended purpose.

3. That the Treasurer of the MSMG shall be authorized to collect from the 356 union members the amount of P50.00 as
penalty for their failure to attend the general membership assembly on April 17, 1988.

However, if the MSMG Officers could present the individual written authorizations of the 356 union members, then the
company is obliged to deduct from the salaries of the 356 union members the P50.00 fine.6

On appeal, Director Pura-Ferrer Calleja issued a Resolution dated February 7, 1989, which modified in part the earlier
disposition, to wit:

WHEREFORE, premises considered, the appealed portion is hereby modified to the extent that the company should remit
the amount of five thousand pesos (P5,000.00) of the P10,000.00 monthly labor education program fund to ULGWP and
the other P5,000.00 to MSMG, both unions to use the same for its intended purpose.7

Meanwhile, on September 2, 1988, several local unions (Top Form, M. Greenfield, Grosby, Triumph International, General
Milling, and Vander Hons chapters) filed a Petition for Audit and Examination of the federation and education funds of
ULGWP which was granted by Med-Arbiter Rasidali Abdullah on December 25, 1988 in an Order which directed the audit
and examination of the books of account of ULGWP.

On September 30, 1988, the officials of ULGWP called a Special National Executive Board Meeting at Nasipit, Agusan del
Norte where a Resolution was passed placing the MSMG under trusteeship and appointing respondent Cesar Clarete as
administrator.

On October 27, 1988, the said administrator wrote the respondent company informing the latter of its designation of a
certain Alfredo Kalingking as local union president and "disauthorizing" the incumbent union officers from representing the
employees. This action by the national federation was protested by the petitioners in a letter to respondent company
dated November 11, 1988.

On November 13, 1988, the petitioner union officers received identical letters from the administrator requiring them to
explain within 72 hours why they should not be removed from their office and expelled from union membership.

On November 26, 1988, petitioners replied:

(a) Questioning the validity of the alleged National Executive Board Resolution placing their union under trusteeship;
(b) Justifying the action of their union in declaring a general autonomy from ULGWP due to the latter's inability to give
proper educational, organizational and legal services to its affiliates and the pendency of the audit of the federation funds;

(c) Advising that their union did not commit any act of disloyalty as it has remained an affiliate of ULGWP;

(d) Giving ULGWP a period of five (5) days to cease and desist from further committing acts of coercion, intimidation and
harassment.8

However, as early as November 21, 1988, the officers were expelled from the ULGWP. The termination letter read:

Effective today, November 21, 1988, you are hereby expelled from UNITED LUMBER AND GENERAL WORKERS OF
THE PHILIPPINES (ULGWP) for committing acts of disloyalty and/or acts inimical to the interest and violative to the
Constitution and by-laws of your federation.

You failed and/or refused to offer an explanation inspite of the time granted to you.

Since you are no longer a member of good standing, ULGWP is constrained to recommend for your termination from your
employment, and provided in Article II Section 4, known as UNION SECURITY, in the Collective Bargaining agreement.9

On the same day, the federation advised respondent company of the expulsion of the 30 union officers and demanded
their separation from employment pursuant to the Union Security Clause in their collective bargaining agreement. This
demand was reiterated twice, through letters dated February 21 and March 4, 1989, respectively, to respondent company.

Thereafter, the Federation filed a Notice of Strike with the National Conciliation and Mediation Board to compel the
company to effect the immediate termination of the expelled union officers.

On March 7, 1989, under the pressure of a threatened strike, respondent company terminated the 30 union officers from
employment, serving them identical copies of the termination letter reproduced below:

We received a demand letter dated 21 November 1988 from the United Lumber and General Workers of the Philippines
(ULGWP) demanding for your dismissal from employment pursuant to the provisions of Article II, Section 4 of the existing
Collective Bargaining Agreement (CBA). In the said demand letter, ULGWP informed us that as of November 21, 1988,
you were expelled from the said federation "for committing acts of disloyalty and/or acts inimical to the interest of ULGWP
and violative to its Constitution and By-laws particularly Article V, Section 6, 9, and 12, Article XIII, Section 8.

In subsequent letters dated 21 February and 4 March 1989, the ULGWP reiterated its demand for your dismissal, pointing
out that notwithstanding your expulsion from the federation, you have continued in your employment with the company in
violation of Sec. 1 and 4 of Article II of our CBA, and of existing provisions of law.

In view thereof, we are left with no alternative but to comply with the provisions of the Union Security Clause of our CBA.
Accordingly, we hereby serve notice upon you that we are dismissing you from your employment with M. Greenfield, Inc.,
pursuant to Sections 1 and 4, Article II of the CBA effective immediately.10

On that same day, the expelled union officers assigned in the first shift were physically or bodily brought out of the
company premises by the company's security guards. Likewise, those assigned to the second shift were not allowed to
report for work. This provoked some of the members of the local union to demonstrate their protest for the dismissal of the
said union officers. Some union members left their work posts and walked out of the company premises.

On the other hand, the Federation, having achieved its objective, withdrew the Notice of Strike filed with the NCMB.

On March 8, 1989, the petitioners filed a Notice of Strike with the NCMB, DOLE, Manila, docketed as Case No. NCMB-
NCR-NS-03-216-89, alleging the following grounds for the strike:

(a) Discrimination

(b) Interference in union activities

(c) Mass dismissal of union officers and shop stewards

(d) Threats, coercion and intimidation

(e) Union busting

The following day, March 9, 1989, a strike vote referendum was conducted and out of 2, 103 union members who cast
their votes, 2,086 members voted to declare a strike.

On March 10, 1989, the thirty (30) dismissed union officers filed an urgent petition, docketed as Case No. NCMB-NCR-
NS-03-216-89, with the Office of the Secretary of the Department of Labor and Employment praying for the suspension of
the effects of their termination from employment. However, the petition was dismissed by then Secretary Franklin Drilon
on April 11, 1989, the pertinent portion of which stated as follows:

At this point in time, it is clear that the dispute at M. Greenfield is purely an intra-union matter. No mass lay-off is evident
as the terminations have been limited to those allegedly leading the secessionist group leaving MSMG-ULGWP to form a
union under the KMU. . . .

xxx-xxx-xxx
WHEREFORE, finding no sufficient jurisdiction to warrant the exercise of our extraordinary authority under Article 277 (b)
of the Labor Code, as amended, the instant Petition is hereby DISMISSED for lack of merit.

SO ORDERED.11

On March 13 and 14, 1989, a total of 78 union shop stewards were placed under preventive suspension by respondent
company. This prompted the union members to again stage a walk-out and resulted in the official declaration of strike at
around 3:30 in the afternoon of March 14, 1989. The strike was attended with violence, force and intimidation on both
sides resulting to physical injuries to several employees, both striking and non-striking, and damage to company
properties.

The employees who participated in the strike and allegedly figured in the violent incident were placed under preventive
suspension by respondent company. The company also sent return-to-work notices to the home addresses of the striking
employees thrice successively, on March 27, April 8 and April 31, 1989, respectively. However, respondent company
admitted that only 261 employees were eventually accepted back to work. Those who did not respond to the return-to-
work notice were sent termination letters dated May 17, 1989, reproduced below:

M. Greenfield Inc., (B)

Km. 14, Merville Rd., Parañaque, M.M.

May 17, 1989

xxx-xxx-xxx

On March 14, 1989, without justifiable cause and without due notice, you left your work assignment at the prejudice of the
Company's operations. On March 27, April 11, and April 21, 1989, we sent you notices to report to the Company. Inspite
of your receipt of said notices, we have not heard from you up to this date.

Accordingly, for your failure to report, it is construed that you have effectively abandoned your employment and the
Company is, therefore, constrained to dismiss you for said cause.

Very truly yours,

M. GREENFIELD, INC., (B)

By:

WENZEL STEPHEN LIGOT

Asst. HRD Manager12

On August 7, 1989, the petitioners filed a verified complaint with the Arbitration Branch, National Capital Region, DOLE,
Manila, docketed as Case No. NCR-00-09-04199-89, charging private respondents of unfair labor practice which consists
of union busting, illegal dismissal, illegal suspension, interference in union activities, discrimination, threats, intimidation,
coercion, violence, and oppression.

After the filing of the complaint, the lease contracts on the respondent company's office and factory at Merville
Subdivision, Parañaque expired and were not renewed. Upon demand of the owners of the premises, the company was
compelled to vacate its office and factory.

Thereafter, the company transferred its administration and account/client servicing department at AFP-RSBS Industrial
Park in Taguig, Metro Manila. For failure to find a suitable place in Metro Manila for relocation of its factory and
manufacturing operations, the company was constrained to move the said departments to Tacloban, Leyte. Hence, on
April 16, 1990, respondent company accordingly notified its employees of a temporary shutdown in operations.
Employees who were interested in relocating to Tacloban were advised to enlist on or before April 23, 1990.

The complaint for unfair labor practice was assigned to Labor Arbiter Manuel Asuncion but was thereafter reassigned to
Labor Arbiter Cresencio Ramos when respondents moved to inhibit him from acting on the case.

On December 15, 1992, finding the termination to be valid in compliance with the union security clause of the collective
bargaining agreement, Labor Arbiter Cresencio Ramos dismissed the complaint.

Petitioners then appealed to the NLRC. During its pendency, Commissioner Romeo Putong retired from the service,
leaving only two commissioners, Commissioner Vicente Veloso III and Hon. Chairman Bartolome Carale in the First
Division. When Commissioner Veloso inhibited himself from the case, Commissioner Joaquin Tanodra of the Third
Division was temporarily designated to sit in the First Division for the proper disposition of the case.

The First Division affirmed the Labor Arbiter's disposition. With the denial of their motion for reconsideration on January
28, 1994, petitioners elevated the case to this Court, attributing grave abuse of discretion to public respondent NLRC in:

I. UPHOLDING THE DISMISSAL OF THE UNION OFFICERS BY RESPONDENT COMPANY AS VALID;

II. HOLDING THAT THE STRIKE STAGED BY THE PETITIONERS AS ILLEGAL;

III. HOLDING THAT THE PETITIONER EMPLOYEES WERE DEEMED TO HAVE ABANDONED THEIR WORK AND
HENCE, VALIDLY DISMISSED BY RESPONDENT COMPANY; AND
IV. NOT FINDING RESPONDENT COMPANY AND RESPONDENT FEDERATION OFFICERS GUILTY OF ACTS OF
UNFAIR LABOR PRACTICE.

Notwithstanding the several issues raised by the petitioners and respondents in the voluminous pleadings presented
before the NLRC and this Court, they revolve around and proceed from the issue of whether or not respondent company
was justified in dismissing petitioner employees merely upon the labor federation's demand for the enforcement of the
union security clause embodied in their collective bargaining agreement.

Before delving into the main issue, the procedural flaw pointed out by the petitioners should first be resolved.

Petitioners contend that the decision rendered by the First Division of the NLRC is not valid because Commissioner
Tanodra, who is from the Third Division, did not have any lawful authority to sit, much less write the ponencia, on a case
pending before the First Division. It is claimed that a commissioner from one division of the NLRC cannot be assigned or
temporarily designated to another division because each division is assigned a particular territorial jurisdiction. Thus, the
decision rendered did not have any legal effect at all for being irregularly issued.

Petitioners' argument is misplaced. Article 213 of the Labor Code in enumerating the powers of the Chairman of the
National Labor Relations Commission provides that:

The concurrence of two (2) Commissioners of a division shall be necessary for the pronouncement of a judgment or
resolution. Whenever the required membership in a division is not complete and the concurrence of two (2)
commissioners to arrive at a judgment or resolution cannot be obtained, the Chairman shall designate such number of
additional Commissioners from the other divisions as may be necessary.

It must be remembered that during the pendency of the case in the First Division of the NLRC, one of the three
commissioners, Commissioner Romeo Putong, retired, leaving Chairman Bartolome Carale and Commissioner Vicente
Veloso III. Subsequently, Commissioner Veloso inhibited himself from the case because the counsel for the petitioners
was his former classmate in law school. The First Division was thus left with only one commissioner. Since the law
requires the concurrence of two commissioners to arrive at a judgment or resolution, the Commission was constrained to
temporarily designate a commissioner from another division to complete the First Division. There is nothing irregular at all
in such a temporary designation for the law empowers the Chairman to make temporary assignments whenever the
required concurrence is not met. The law does not say that a commissioner from the first division cannot be temporarily
assigned to the second or third division to fill the gap or vice versa. The territorial divisions do not confer exclusive
jurisdiction to each division and are merely designed for administrative efficiency.

Going into the merits of the case, the court finds that the Complaint for unfair labor practice filed by the petitioners against
respondent company which charges union busting, illegal dismissal, illegal suspension, interference in union activities,
discrimination, threats, intimidation, coercion, violence, and oppression actually proceeds from one main issue which is
the termination of several employees by respondent company upon the demand of the labor federation pursuant to the
union security clause embodied in their collective bargaining agreement.

Petitioners contend that their dismissal from work was effected in an arbitrary, hasty, capricious and illegal manner
because it was undertaken by the respondent company without any prior administrative investigation; that, had
respondent company conducted prior independent investigation it would have found that their expulsion from the union
was unlawful similarly for lack of prior administrative investigation; that the federation cannot recommend the dismissal of
the union officers because it was not a principal party to the collective bargaining agreement between the company and
the union; that public respondents acted with grave abuse of discretion when they declared petitioners' dismissals as valid
and the union strike as illegal and in not declaring that respondents were guilty of unfair labor practice.

Private respondents, on the other hand, maintain that the thirty dismissed employees who were former officers of the
federation have no cause of action against the company, the termination of their employment having been made upon the
demand of the federation pursuant to the union security clause of the CBA; the expelled officers of the local union were
accorded due process of law prior to their expulsion from their federation; that the strike conducted by the petitioners was
illegal for noncompliance with the requirements; that the employees who participated in the illegal strike and in the
commission of violence thereof were validly terminated from work; that petitioners were deemed to have abandoned their
employment when they did not respond to the three return to work notices sent to them; that petitioner labor union has no
legal personality to file and prosecute the case for and on behalf of the individual employees as the right to do so is
personal to the latter; and that, the officers of respondent company cannot be liable because as mere corporate officers,
they acted within the scope of their authority.

Public respondent, through the Labor Arbiter, ruled that the dismissed union officers were validly and legally terminated
because the dismissal was effected in compliance with the union security clause of the CBA which is the law between the
parties. And this was affirmed by the Commission on appeal. Moreover, the Labor Arbiter declared that notwithstanding
the lack of a prior administrative investigation by respondent company, under the union security clause provision in the
CBA, the company cannot look into the legality or illegality of the recommendation to dismiss by the union nd the
obligation to dismiss is ministerial on the part of the company.13

This ruling of the NLRC is erroneous. Although this Court has ruled that union security clauses embodied in the collective
bargaining agreement may be validly enforced and that dismissals pursuant thereto may likewise be valid, this does not
erode the fundamental requirement of due process. The reason behind the enforcement of union security clauses which is
the sanctity and inviolability of contracts14 cannot override one's right to due process.

In the case of Cariño vs. National Labor Relations Commission,15 this Court pronounced that while the company, under a
maintenance of membership provision of the collective bargaining agreement, is bound to dismiss any employee expelled
by the union for disloyalty upon its written request, this undertaking should not be done hastily and summarily. The
company acts in bad faith in dismissing a worker without giving him the benefit of a hearing.
The power to dismiss is a normal prerogative of the employer. However, this is not without limitation. The employer is
bound to exercise caution in terminating the services of his employees especially so when it is made upon the request of
a labor union pursuant to the Collective Bargaining Agreement, . . . Dismissals must not be arbitrary and capricious. Due
process must be observed in dismissing an employee because it affects not only his position but also his means of
livelihood. Employers should respect and protect the rights of their employees, which include the right to labor.

In the case under scrutiny, petitioner union officers were expelled by the federation for allegedly committing acts of
disloyalty and/or inimical to the interest of ULGWP and in violation of its Constitution and By-laws. Upon demand of the
federation, the company terminated the petitioners without conducting a separate and independent investigation.
Respondent company did not inquire into the cause of the expulsion and whether or not the federation had sufficient
grounds to effect the same. Relying merely upon the federation's allegations, respondent company terminated petitioners
from employment when a separate inquiry could have revealed if the federation had acted arbitrarily and capriciously in
expelling the union officers. Respondent company's allegation that petitioners were accorded due process is belied by the
termination letters received by the petitioners which state that the dismissal shall be immediately effective.

As held in the aforecited case of Cariño, "the right of an employee to be informed of the charges against him and to
reasonable opportunity to present his side in a controversy with either the company or his own union is not wiped away by
a union security clause or a union shop clause in a collective bargaining agreement. An employee is entitled to be
protected not only from a company which disregards his rights but also from his own union the leadership of which could
yield to the temptation of swift and arbitrary expulsion from membership and mere dismissal from his job.

While respondent company may validly dismiss the employees expelled by the union for disloyalty under the union
security clause of the collective bargaining agreement upon the recommendation by the union, this dismissal should not
be done hastily and summarily thereby eroding the employees' right to due process, self-organization and security of
tenure. The enforcement of union security clauses is authorized by law provided such enforcement is not characterized by
arbitrariness, and always with due process.16 Even on the assumption that the federation had valid grounds to expel the
union officers, due process requires that these union officers be accorded a separate hearing by respondent company.

In its decision, public respondent also declared that if complainants (herein petitioners) have any recourse in law, their
right of action is against the federation and not against the company or its officers, relying on the findings of the Labor
Secretary that the issue of expulsion of petitioner union officers by the federation is a purely intra-union matter.

Again, such a contention is untenable. While it is true that the issue of expulsion of the local union officers is originally
between the local union and the federation, hence, intra-union in character, the issue was later on converted into a
termination dispute when the company dismissed the petitioners from work without the benefit of a separate notice and
hearing. As a matter of fact, the records reveal that the termination was effective on the same day that the termination
notice was served on the petitioners.

In the case of Liberty Cotton Mills Workers Union vs. Liberty Cotton Mills, Inc.17, the Court held the company liable for the
payment of backwages for having acted in bad faith in effecting the dismissal of the employees.

. . . Bad faith on the part of the respondent company may be gleaned from the fact that the petitioner workers were
dismissed hastily and summarily. At best, it was guilty of a tortious act, for which it must assume solidary liability, since it
apparently chose to summarily dismiss the workers at the union's instance secure in the union's contractual undertaking
that the union would hold it "free from any liability" arising from such dismissal.

Thus, notwithstanding the fact that the dismissal was at the instance of the federation and that it undertook to hold the
company free from any liability resulting from such a dismissal, the company may still be held liable if it was remiss in its
duty to accord the would-be dismissed employees their right to be heard on the matter.

Anent petitioners contention that the federation was not a principal party to the collective bargaining agreement between
the company and the union, suffice it to say that the matter was already ruled upon in the Interpleader case filed by
respondent company. Med-Arbiter Anastacio Bactin thus ruled:

After a careful examination of the facts and evidences presented by the parties, this Officer hereby renders its decision as
follows:

1.) It appears on record that in Collective Bargaining Agreement (CBA) which took effect on July 1, 1986, the contracting
parties are M. Greenfield, Inc. (B) and Malayang Samahan ng Mga Manggagawa sa M. Greenfield, Inc. (B)
(MSMG)/United Lumber and General Workers of the Philippines (ULGWP). However, MSMG was not yet registered labor
organization at the time of the signing of the CBA. Hence, the union referred to in the CBA is the ULGWP.18

Likewise on appeal, Director Pura Ferrer-Calleja put the issue to rest as follows:

It is undisputed that ULGWP is the certified sole and exclusive collective bargaining agent of all the regular rank-and-file
workers of the company, M. Greenfield, Inc. (pages 31-32 of the records).

It has been established also that the company and ULGWP signed a 3-year collective bargaining agreement effective July
1, 1986 up to June 30, 1989.19

Although the issue of whether or not the federation had reasonable grounds to expel the petitioner union officers is
properly within the original and exclusive jurisdiction of the Bureau of Labor Relations, being an intra-union conflict, this
Court deems it justifiable that such issue be nonetheless ruled upon, as the Labor Arbiter did, for to remand the same to
the Bureau of Labor Relations would be to intolerably delay the case.

The Labor Arbiter found that petitioner union officers were justifiably expelled from the federation for committing acts of
disloyalty when it "undertook to disaffiliate from the federation by charging ULGWP with failure to provide any legal,
educational or organizational support to the local. . . . and declared autonomy, wherein they prohibit the federation from
interfering in any internal and external affairs of the local union."20

It is well-settled that findings of facts of the NLRC are entitled to great respect and are generally binding on this Court, but
it is equally well-settled that the Court will not uphold erroneous conclusions of the NLRC as when the Court finds
insufficient or insubstantial evidence on record to support those factual findings. The same holds true when it is perceived
that far too much is concluded, inferred or deduced from the bare or incomplete facts appearing of record.21

In its decision, the Labor Arbiter declared that the act of disaffiliation and declaration of autonomy by the local union was
part of its "plan to take over the respondent federation." This is purely conjecture and speculation on the part of public
respondent, totally unsupported by the evidence.

A local union has the right to disaffiliate from its mother union or declare its autonomy. A local union, being a separate and
voluntary association, is free to serve the interests of all its members including the freedom to disaffiliate or declare its
autonomy from the federation to which it belongs when circumstances warrant, in accordance with the constitutional
guarantee of freedom of association.22

The purpose of affiliation by a local union with a mother union or a federation.

. . . is to increase by collective action the bargaining power in respect of the terms and conditions of labor. Yet the locals
remained the basic units of association, free to serve their own and the common interest of all, subject to the restraints
imposed by the Constitution and By-Laws of the Association, and free also to renounce the affiliation for mutual welfare
upon the terms laid down in the agreement which brought it into existence.23

Thus, a local union which has affiliated itself with a federation is free to sever such affiliation anytime and such
disaffiliation cannot be considered disloyalty. In the absence of specific provisions in the federation's constitution
prohibiting disaffiliation or the declaration of autonomy of a local union, a local may dissociate with its parent union.24

The evidence on hand does not show that there is such a provision in ULGWP's constitution. Respondents' reliance upon
Article V, Section 6, of the federation's constitution is not right because said section, in fact, bolsters the petitioner union's
claim of its right to declare autonomy:

Sec. 6. The autonomy of a local union affiliated with ULGWP shall be respected insofar as it pertains to its internal affairs,
except as provided elsewhere in this Constitution.

There is no disloyalty to speak of, neither is there any violation of the federation's constitution because there is nothing in
the said constitution which specifically prohibits disaffiliation or declaration of autonomy. Hence, there cannot be any valid
dismissal because Article II, Section 4 of the union security clause in the CBA limits the dismissal to only three (3)
grounds, to wit: failure to maintain membership in the union (1) for non-payment of union dues, (2) for resignation; and (3)
for violation of the union's Constitution and By-Laws.

To support the finding of disloyalty, the Labor Arbiter gave weight to the fact that on February 26, 1989, the petitioners
declared as vacant all the responsible positions of ULGWP, filled these vacancies through an election and filed a petition
for the registration of UWP as a national federation. It should be pointed out, however, that these occurred after the
federation had already expelled the union officers. The expulsion was effective November 21, 1988. Therefore, the act of
establishing a different federation, entirely separate from the federation which expelled them, is but a normal retaliatory
reaction to their expulsion.

With regard to the issue of the legality or illegality of the strike, the Labor Arbiter held that the strike was illegal for the
following reasons: (1) it was based on an intra-union dispute which cannot properly be the subject of a strike, the right to
strike being limited to cases of bargaining deadlocks and unfair labor practice (2) it was made in violation of the "no strike,
no lock-out" clause in the CBA, and (3) it was attended with violence, force and intimidation upon the persons of the
company officials, other employees reporting for work and third persons having legitimate business with the company,
resulting to serious physical injuries to several employees and damage to company property.

On the submission that the strike was illegal for being grounded on a non-strikeable issue, that is, the intra-union conflict
between the federation and the local union, it bears reiterating that when respondent company dismissed the union
officers, the issue was transformed into a termination dispute and brought respondent company into the picture.
Petitioners believed in good faith that in dismissing them upon request by the federation, respondent company was guilty
of unfair labor practice in that it violated the petitioner's right to self-organization. The strike was staged to protest
respondent company's act of dismissing the union officers. Even if the allegations of unfair labor practice are subsequently
found out to be untrue, the presumption of legality of the strike prevails.25

Another reason why the Labor Arbiter declared the strike illegal is due to the existence of a no strike no lockout provision
in the CBA. Again, such a ruling is erroneous. A no strike, no lock out provision can only be invoked when the strike is
economic in nature, i.e. to force wage or other concessions from the employer which he is not required by law to grant.26
Such a provision cannot be used to assail the legality of a strike which is grounded on unfair labor practice, as was the
honest belief of herein petitioners. Again, whether or not there was indeed unfair labor practice does not affect the strike.

On the allegation of violence committed in the course of the strike, it must be remembered that the Labor Arbiter and the
Commission found that "the parties are agreed that there were violent incidents . . . resulting to injuries to both sides, the
union and management."27 The evidence on record show that the violence cannot be attributed to the striking employees
alone for the company itself employed hired men to pacify the strikers. With violence committed on both sides, the
management and the employees, such violence cannot be a ground for declaring the strike as illegal.

With respect to the dismissal of individual petitioners, the Labor Arbiter declared that their refusal to heed respondent's
recall to work notice is a clear indication that they were no longer interested in continuing their employment and is deemed
abandonment. It is admitted that three return to work notices were sent by respondent company to the striking employees
on March 27, April 11, and April 21, 1989 and that 261 employees who responded to the notice were admitted back to
work.

However, jurisprudence holds that for abandonment of work to exist, it is essential (1) that the employee must have failed
to report for work or must have been absent without valid or justifiable reason; and (2) that there must have been a clear
intention to sever the employer-employee relationship manifested by some overt acts.28 Deliberate and unjustified refusal
on the part of the employee to go back to his work post amd resume his employment must be established. Absence must
be accompanied by overt acts unerringly pointing to the fact that the employee simply does not want to work anymore.29
And the burden of proof to show that there was unjustified refusal to go back to work rests on the employer.

In the present case, respondents failed to prove that there was a clear intention on the part of the striking employees to
sever their employer-employee relationship. Although admittedly the company sent three return to work notices to them, it
has not been substantially proven that these notices were actually sent and received by the employees. As a matter of
fact, some employees deny that they ever received such notices. Others alleged that they were refused entry to the
company premises by the security guards and were advised to secure a clearance from ULGWP and to sign a waiver.
Some employees who responded to the notice were allegedly told to wait for further notice from respondent company as
there was lack of work.

Furthermore, this Court has ruled that an employee who took steps to protest his lay-off cannot be said to have
abandoned his work.30 The filing of a complaint for illegal dismissal is inconsistent with the allegation of abandonment. In
the case under consideration, the petitioners did, in fact, file a complaint when they were refused reinstatement by
respondent company.

Anent public respondent's finding that there was no unfair labor practice on the part of respondent company and
federation officers, the Court sustains the same. As earlier discussed, union security clauses in collective bargaining
agreements, if freely and voluntarily entered into, are valid and binding. Corollary, dismissals pursuant to union security
clauses are valid and legal subject only to the requirement of due process, that is, notice and hearing prior to dismissal.
Thus, the dismissal of an employee by the company pursuant to a labor union's demand in accordance with a union
security agreement does not constitute unfair labor practice.31

However, the dismissal was invalidated in this case because of respondent company's failure to accord petitioners with
due process, that is, notice and hearing prior to their termination. Also, said dismissal was invalidated because the reason
relied upon by respondent Federation was not valid. Nonetheless, the dismissal still does not constitute unfair labor
practice.

Lastly, the Court is of the opinion, and so holds, that respondent company officials cannot be held personally liable for
damages on account of the employees' dismissal because the employer corporation has a personality separate and
distinct from its officers who merely acted as its agents.

It has come to the attention of this Court that the 30-day prior notice requirement for the dismissal of employees has been
repeatedly violated and the sanction imposed for such violation enunciated in Wenphil Corporation vs. NLRC32 has
become an ineffective deterrent. Thus, the Court recently promulgated a decision to reinforce and make more effective
the requirement of notice and hearing, a procedure that must be observed before termination of employment can be
legally effected.

In Ruben Serrano vs. NLRC and Isetann Department Store (G.R. No. 117040, January 27, 2000), the Court ruled that an
employee who is dismissed, whether or not for just or authorized cause but without prior notice of his termination, is
entitled to full backwages from the time he was terminated until the decision in his case becomes final, when the dismissal
was for cause; and in case the dismissal was without just or valid cause, the backwages shall be computed from the time
of his dismissal until his actual reinstatement. In the case at bar, where the requirement of notice and hearing was not
complied with, the aforecited doctrine laid down in the Serrano case applies.

WHEREFORE, the Petition is GRANTED; the decision of the National Labor Relations Commission in Case No. NCR-00-
09-04199-89 is REVERSED and SET ASIDE; and the respondent company is hereby ordered to immediately reinstate the
petitioners to their respective positions. Should reinstatement be not feasible, respondent company shall pay separation
pay of one month salary for every year of service. Since petitioners were terminated without the requisite written notice at
least 30 days prior to their termination, following the recent ruling in the case of Ruben Serrano vs. National Labor
Relations Commission and Isetann Department Store, the respondent company is hereby ordered to pay full backwages
to petitioner-employees while the Federation is also ordered to pay full backwages to petitioner-union officers who were
dismissed upon its instigation. Since the dismissal of petitioners was without cause, backwages shall be computed from
the time the herein petitioner employees and union officers were dismissed until their actual reinstatement. Should
reinstatement be not feasible, their backwages shall be computed from the time petitioners were terminated until the
finality of this decision. Costs against the respondent company.

SO ORDERED.
 Di ko po alam kung alin sa dalawa kaya nicopy ko po parehas
Malayang Samahan ng Manggawa sa Greenfield v. Ramos, 326 SCRA441
[G.R. No. 113907. April 20, 2001.]

MALAYANG SAMAHAN NG MGA MANGGAGAWA SA M. GREENFIELD (MSMG-UWP), ITS PRESIDENT BEDA MAGDALENA
VILLANUEVA, MARIO DAGANIO, DONATO GUERRERO, BELLA P. SANCHEZ, ELENA TOBIS, RHODA TAMAYO, LIWAYWAY
MALLILIN, ELOISA SANTOS, DOMINADOR REBULLO, JOSE IRLAND, TEOFILA QUEJADA, VICENTE SAMONTINA,
FELICITAS DURIAN, ANTONIO POLDO, ANGELINA TUGNA, SALVADOR PENALOSA, LUZVIMINDA TUBIG, ILUMINADA
RIVERA, ROMULO SUMILANG, NENITA BARBELONIA, LEVI BASILIA, RICARDO PALAGA, MERCY ROBLES, LEODEGARIO
GARIN, DOMINGO ECLARINAL, MELCHOR GALLARDO, MARCELO GARIN, ROSALINA BAUTISTA, MARY ANN TALIGATOS,
ALEJANDRO SANTOS, ANTONIO FRAGA, LUZ GAPULTOS, MAGDALENA URSUA, EUGENIO ORDAN, LIGAYA MANALO,
PEPITO DELA PAZ, PERLITA DIMAQUIAT, MYRNA VASQUEZ, FLORENTINA SAMPAGA, ARACELI FRAGA, MAXIMINA
FAUSTINO, MARINA TAN, OLIGARIO LOMO, PRECILA EUSEBIO, SUSAN ABOGANO, CAROLINA MANINANG, GINA
GLIFONIA, OSCAR SOTTO, CELEDONA MALIGAYA, EFREN VELASQUEZ, DELIA ANOVER, JOSEPHINE TALIMORO,
MAGDALENA TABOR, NARCISA SARMIENTO, SUSAN MACASIEB, FELICIDAD SISON, PRICELA CARTA, MILA MACAHILIG,
CORAZON NUNALA, VISITACION ELAMBRE, ELIZABETH INOFRE, VIOLETA BARTE, LUZVIMINDA VILLOSA, NORMA
SALVADOR, ELIZABETH BOGATE, MERLYN BALBOA, EUFRECINA SARMIENTO, SIMPLICIA BORLEO, MATERNIDAD
DAVID, LAILA JOP, POTENCIANA CULALA, LUCIVITA NAVARRO, ROLANDO BOTIN, AMELITA MAGALONA, AGNES CENA,
NOLI BARTOLAY, DANTE AQUINO, HERMINIA RILLON, CANDIDA APARIJADO, LYDIA JIMENEZ, ELIZABETH ANOCHE,
ALDA MURO, TERESA VILLANUEVA, TERESITA RECUENCO, ELIZA SERRANO, ESTELLA POLINAR, GERTRUDES NUNEZ,
FELIPE BADIOLA, ROSLYN FERNANDEZ, OSCAR PAGUTA, NATIVIDAD BALIWAS, ELIZABETH BARCIBAL, CYNTHIA
ESTELLER, TEODORA SANTOS, ALICIA PILAR, MILA PATENO, GLORIA CATRIZ, MILA MACAHILIG, ADELAIDA DE LEON,
ROSENDO EDILO, ARSENIA ESPIRITU, NUMERIANO CABRERA, CONCEPSION ARRIOLA, PAULINA DIMAPASOK, ANGELA
SANGCO, PRESILA ARIAS, ZENAIDA NUNES, EDITHA IGNACIO, ROSA GUIRON, TERESITA CANETA, ALICIA ARRO,
TEOFILO RUWETAS, CARLING AGCAOILI, ROSA NOLASCO, GERLIE PALALON, CLAUDIO DIRAS, LETICIA ALBOS,
AURORA ALUBOG, LOLITA ACALEN, GREGORIO ALIVIO, GUILLERMO ANICETA, ANGELIE ANDRADA, SUSAN ANGELES,
ISABELITA AURIN, MANUELA AVELINA, CARLING AGCAOILI, TERESITA ALANO, LOLITA AURIN, EMMABETH ARCIAGA,
CRESENCIA ACUNA, LUZVIMINDA ABINES, FLORENCIA ADALID, OLIVIA AGUSTIN, EVANGELINE ALCORAN, ROSALINA
ALFERES, LORNA AMANTE, FLORENTINA AMBITO, JULIETA AMANONCO, CARMEN AMARILLO, JOSEFINA AMBAGAN,
ZENAIDA ANAYA, MARIA ANGLO, EDITHA ANTA ZO, MARY JANE ANTE, ANDREA AQUINO, ROWENA ARABIT, MARIETA
ARAGON, REBECCA ARCENA, LYDIA ARCIDO, FERNANDO ARENAS, GREGORIO ARGUELLES, EDITHA ARRIOLA, EMMA
ATIENZA, EMMA ATIENZA, TEODY ATIENZA, ELIZABETH AUSTRIA, DIOSA AZARES, SOLIDA AZAINA, MILAGROS BUAG,
MARIA BANADERA, EDNALYN BRAGA, OFELIA BITANGA, FREDISMINDA BUGUIS, VIOLETA BALLESTEROS, ROSARIO
BALLADJAY, BETTY BORIO, ROMANA BAUTISTA, SUSARA BRAVO, LILIA BAHINGTING, ENIETA BALDOZA, DAMIANA
BANGCORE, HERMINIA BARIL, PETRONA BARRIOS, MILAGROS BARRAMEDA, PERLA BAUTISTA, CLARITA BAUTISTA,
ROSALINA BAUTISTA, ADELINA BELGA, CONSOLACION BENAS, MARIA BEREZO, MERCEDES BEREBER, VIOLETA
BISCOCHO, ERNESTO BRIONES, ALVINA BROSOTO, AGUSTINA BUNYI, CARMEN BUGNOT, ERLINDA BUENAFLOR, LITA
BAQUIN, CONSEJO BABOL, CRISANTA BACOLOD, CELIA DE BACTAT, MAZIMA BAGA, ELENA BALADAD, ROSARIO
BALADJAY, AMALIA BALAGTAS, ANITA BALAGTAS, MARIA BALAKIT, RUFINA BALATAN, REBECCA BALDERAMA, AMELIA
BALLESTER, BELEN BARQUIO, BERNANDITA BASILIDES, HELEN BATO, HELEN BAUTISTA, ROMANA BAUTISTA,
ALMEDA BAYTA, AVELINA BELAYON, NORMA DE BELEN, THELMA DE BELEN, JOCELYN BELTRAN, ELENA BENITEZ,
VIRGINIA BERNARDINO, MERLINA BINUYAG, LINA BINUYA, BLESILDA BISNAR, SHIRLEY BOLIVAR, CRESENTACION
MEDLO, JOCELYN BONIFACIO, AMELIA BORBE, AMALIA BOROMEO, ZENAIDA BRAVO, RODRIGO BEULDA, TERESITA
MENDEZ, ELENA CAMAN, LALIANE CANDELARIA, MARRY CARUJANO, REVELINA CORANES, MARITESS CABRERA,
JUSTINA CLAZADA, APOLONIA DELA CRUZ, VICTORIA CRUZ, JOSEFINA DELA CRUZ, MARITESS CATANGHAL, EDNA
CRUZ, LUCIA DE CASTRO, JOSIE CARIASO, OFELIA CERVANTES, MEDITA CORTADO, AMALIA CASAJEROS, LUCINA
CASTILIO, EMMA CARPIO, ANACORITA CABALES, YOLANDA CAMO, MILA CAMAZUELA, ANITA CANTO, ESTELA
CANCERAN, FEMENCIA CANCIO, CYNTHIA CAPALAD, MERLE CASTILLO, JESUSA CASTRO, CECILIA CASTILLO,
SILVERITA CASTRODES, VIVIAN CELLANO, NORMA CELINO, TERESITA CELSO, GLORIA COLINA, EFIPANIA
CONSTANTINO, SALVACION CONSULTA, MEDITA CORTADO, AIDA CRUZ, MARISSA DELA CRUZ, EDITO CORCILLES,
JELYNE CRUZ, ROSA CORPOS, ROSITA CUGONA, ELSE CABELLES, EMMA CADUT, VICTORIA CALANZA, BARBARA
CALATA, IMELDA CALDERON, CRISTINA CALIDGUID, EMMALINDA CAMALON, MARIA CAMERINO, CARMENCITA CAMPO,
CONNIE CANEZO, LOURDES CAPANANG, MA. MILAGROS CAPILI, MYRNA T. CAPIRAL, FLOR SAMPAGA, SUSAN B.
CARINO, ROSARIO CARIZON, VIRGINIA DEL CARMEN, EMMA CARPIO, PRESCILA CARTA, FE CASERO, LUZ DE
CASTRO, ANNA CATARONGAN, JOSEFINA CASTISIMO, JOY MANALO, EMMIE CAWALING, JOVITA CARA, MARINA
CERBITO, MARY CAREJANO, ESTELA R. CHAVEZ, CONCEPCION PARAJA, GINA CLAUDIO, FLORDELIZA CORALES,
EDITO CORCIELER, ROSA C. CORROS, AMELIA CRUZ, JELYNE CRUZ, WILFREDO DELA CRUZ, REINA CUEVAS,
MARILOU DEJECES, JOSEPHINE DESACULA, EDITHA DEE, EDITHA DIAZ, VIRGE DOMONDON, CELSA DOROPAW,
VIOLETA DUMELINA, MARIBEL DIMATATAC, ELBERTO DAGANIO, LETECIA DAGOHOY, DINDO DALUZ, ANGELITA
DANTES, GLORIA DAYO, LUCIA DE CASTRO, CARLITA DE GUZMAN, CARMEN DELA CRUZ, MERCY DE LEON, MARY
DELOS REYES, MARIETA DEPILO, MATILDE DIBLAS, JULETA DIMAYUGA, TEODORA DIMAYUGA, YOLANDA DOMDOM,
LUCITA DONATO, NELMA DORADO, RITA DORADO, SUSAN DUNTON, HERMINIA SAN ESTEBAN, AMALI EUGENIO,
OLIVIA EUSOYA, ERNESTO ESCOBIN, EVELYN ESCUREL, LYDIA ESCOBIN, VICENTE E. ELOIDA, ELENA EGAR, GLORIA
ERENO, NORMA ESPIRIDION, ARSENIA ESPIRITU, AURORA ESTACIO, DEMETRIA ESTONELO, MILAGROS FONSEGA,
LYDIA FLORENTINO, JULIA FARABIER, TRINIDAD FATALLA, IMELDA FLORES, JESSINA FRANCO, MA. CRISTINA FRIJAS,
ESPECTACION FERRER, BERDENA FLORES, LEONILA FRANCISCO, BERNARDA FAUSTINO, DOLORES FACUNDO,
CRESTITA FAMILARAN, EMELITA FIGUERAS, MA. VIRGINIA FLORENDO, AURORA FRANCISCO, MA. JESUSA
FRANCISCO, NENITA FUENTES, MARILOU GOLINGAN, JUANITA GUERRERO, LYDIA GUEVARRA, SOCCORRO
GONZAGA. PATRICIA GOMEO, ROSALINDA GALAPIN, CARMELITA GALVEZ, TERESA GLE, SONIA GONZALES, PRIMITA
GOMEZ, THERESA GALUA, JOSEFINA GELUA, BRENDA GONZAGA, FLORA GALLARDO, LUCINDA GRACILLA, VICTORIA
GOZUM, NENITA GAMAO, EDNA GARCIA, DANILO GARCIA, ROSARIO GIRAY, ARACELI GOMEZ, JOEMARIE GONZAGA,
NELIA GONZAGA, MARY GRACE GOZON, CARMEN GONZALES, MERLITA GREGORIO, HERMINIA GONZALES, CARLITA
DE GUZMAN, MODESTA GABRENTINA, EDITHA GADDI, SALVACIO GALIAS, MERLINDA GALIDO, MELINDA GAMIT,
JULIETA GARCIA, EMELITA GAVINO, CHARITO GILLIA, GENERA GONEDA, CRESTITA GONZALES, HERMINIA
GONZALES, FRANCISCA GUILING, JULIAN HERNANDEZ, GLECERIA HERRADURA, SUSANA HIPOLITO, NERISSA HAZ,
SUSAN HERNAEZ, APOLONIA ISON, SUSAN IBARRA, LUDIVINA IGNACIO, CHOLITA INFANTE, JULETA ITURRIOS, ANITA
IBO, MIRASOL INGALLA, JULIO JARDINIANO, MERLITA JULAO, JULIETA JULIAN, MARIBETH DE JOSE, JOSEPHINE
JENER, IMELDA JATAP, JULIETA JAVIER, SALOME JAVIER, VICTORIA JAVIER, SALVACION JOMOLO, EDNA JARNE,
LYDIA JIMENEZ, TERESITA DE JUAN, MARILYN LUARCA, ROSITA LOSITO, ROSALINA LUMAYAG, LORNA LARGA,
CRESTETA DE LEON, ZENAIDA LEGASPI, ADELAIDA LEON, IMELDA DE LEON, MELITINA LUMABI, LYDIA LUMABI,
ASUNCION LUMACANG, REGINA LAPIADRIO, MELANIA LUBUGUAN, EVANGELINE LACAP, PELAGIA LACSI, LORNA
LAGUI, VIRGIE LAITAN, VIRGINIA LEE, CRESTELITA DE LEON, FELICISIMA LEONERO, DIOSA LOPE, ANGELITA LOPEZ,
TERESITA LORICA, JUANITA MENDIETA, JUANITA MARANQUEZ, JANET MALIFERO, INAS MORADOS, MELANE MANING,
LUCENA MABANGLO, CLARITA MEJIA, IRENE MENDOZA, LILIA MORTA, VIGINIA MARAY, CHARITO MASINAHON, FILMA
MALAYA, LILIA MORTA, VIRGINIA MARAY, CHARITO MASINAHON, FILMA MALAYA, LILIA MORTA, ROSITA MATIBAG,
LORENZA MLINA, SABINA DEL MUNDO, EDITHA MUYCO, NARCISA MABEZA, MA. FE MACATANGAY, CONCEPCION
MAGDARAOG, IMELDA MAHIYA, ELSA MALLARI, LIGAYA MANAHAN, SOLEDA MANLAPAS, VIRGINIA MAPA, JOSEI
MARCOS, LIBRADA MARQUEZ, VIRGINIA MAZA, JULLANITA MENDETA, EDILBERTA MENDOZA, IRENE MERCADO,
HELEN MEROY, CRISTINA MEJARES, CECILIA MILLET, EMELITA MINON, JOSEPHINE MIRANA, PERLITA MIRANO,
EVANGELINE MISBAL, ELEANOR MORALES, TERESITA MORILLA, LYDIA NUDO, MYRNA NAVAL, CAROLINA NOLIA,
ALICIA NUNEZ, MAGDALENA NAGUIDA, ELSA NICOL, LILIA NACIONALES, MA. LIZA MABO, REMEDIOS NIEVES,
MARGARITA NUYLAN, TERESITA NIEVES, PORFERIA NARAG, RHODORA NUCASA, CORAZON OCRAY, LILIA OLIMPO,
VERONA OVERENCIA, FERMIN OSENA, FLORENCIA OLIVAROS, SOLEDAD OBEAS, NARISSA OLIVEROS, PELAGIA
ORTEGA, SUSAN ORTEGA, CRISTINA PRENCIPE, PURITA PENGSON, REBECCA PACERAN, EDNA PARINA, MARIETA
PINAT, EPIFANIA PAJERLAN, ROSALINA PASIBE, CECILIA DELA PAZ, LORETA PENA, APOLONIA PALCONIT, FRANCISCO
PAGUIO, LYDIA PAMINTAHON, ELSIE PACALDO, TERESITA PADILLA, MYRNA PINEDA, MERCEDITA PEREZ, NOVENA
PORLUCAS, TERESITA PODPOD, ADORACION PORNOBI, ALICIA PERILLO, HELEN JOY PENDAL, LOURDES PACHECO,
LUZVIMINDA PAGALA, LORETA PAGAPULAN, FRANCISCO PAGUIO, PRISCO PALACA, FLORA PAMINTUAN, NOEMI
PARISALES, JOSEPHINE PATRICIO, CRISTINA PE BENITO, ANGELA PECO, ANGELITA PENA, ESTER PENONES, NORMA
PEREZ, MAURA PERSEVERANCIA, MARINA PETILLA, JOSE PIA, ZULVILITA PIODO, REBECCA PACERAN, CLARITA
POLICARPIO, MAXIMO POTENTO, PORFIRIO POTENTO, FLORDELIZA PUMARAS, FERNANDO QUEVEDO, JULIANA
QUINDOZA, CHARITO QUIROZ, CARMELITA ROSINO, RODELIA RAYONDOYON, FLORENCIA RAGOS, REBECCA
ROSALES, ROSALYN RIVERO, FRANCISCO RUIZ, FRANCIA ROSERO, EMELY RUBIO, EDILBERTO RUIO, JUANA RUBY,
RAQUEL REYES, MERCY ROBLES, ESTELA RELANO, ROSITA REYES NIMFA RENDON, EPIFANIO RAMIRO, MURIEL
REALCO, BERNARDITA RED, LEONITA RODIL, BENITA REBOLA, DELMA REGALARIO, LENY REDILLAS, JULIETA DELA
ROSA, FELICITAS DELA ROSA, SUSAN RAFALLO, ELENA RONDINA, NORMA RACELIS, JOSEPHINE RAGEL, ESPERANZA
RAMIREZ, LUZVIMINDA RANADA, CRISTINA RAPINSAN, JOCELYN RED, ORLANDO REYES, TERESITA REYES, ANGELITA
ROBERTO, DELIA ROCHA, EDILTRUDES ROMERO, MELECIA ROSALES, ZENAIDA ROTAO, BELEN RUBIS, FE RUEDA,
SYLVIA SONGCAYAWON, CRISTINA SANANO, NERCISA SARMIENTO, HELEN SIBAL, ESTELITA SANTOS, NORMA
SILVESTRE, DARLITA SINGSON, EUFROCINA SARMIENTO, MYRNA SAMSON, EMERLINA SADIA, LORNA SALAZAR,
AVELINA SALVADOR, NACIFORA SALAZAR, TITA SEUS, MARIFE SANTOS, GRACIA SARMIENTO, ANGELITA SUMANGIL,
ELIZABETH SICAT, MA. VICTORIA SIDELA, ANALITA SALVADOR, MARITES SANTOS, VIRGINIA SANTOS, THELMA
SARONG, NILDA SAYAT, FANCITA SEGUNDO, FYNAIDA SAGUI, EDITHA SALAZAR, EDNA SALZAR, EMMA SALENDARIO,
SOLEDAD SAMSON, EDNA SAN DIEGO, TERESITA SAN GABRIEL, GERTRUDES SAN JOSE, EGLECERIA OSANCHEZ,
ESTRELLA SANCHEZ, CECILIA DELOS SANTOS, LUISA SEGOVIA, JOCELYN SENDING ELENA SONGALIA, FELICITAS
SORIANO, OFELIA TIBAYAN, AIDA TIRNIDA, MONICA TIBAYAN, CRISTETA TAMBARAN, GLORIA TACDA, NENVINA,
FELINA TEVES, ANTONINA DELA TORRE, MAXIMA TANILON, NENA TABAT, ZOSIMA TOLOSA, MARITA TENOSO, IMELDA
TANIO, LUZ TANIO, EVANGELINE TAYO, JOSEFINA TINGTING, ARSENIA TISOY, ARSENIA MAGDALENA TRAJANO,
JOSEFINA UBALDE, GINA UMALI, IRMA VALENZUELA, FELY VALDEZ, PAULINA VALEZ, ROSELITA VALLENTE, LOURDES
VELASCO, AIDA VILLA, FRANCISCA VILLARITO, ZENAIDA VISMONTE, DELIA VILLAMIEL, NENITA VASQUEZ, JOCELYN
VILLASIS, FERMARGARITA VARGAS, CELIA VALLE, MILA CONCEPCION VIRAY, DOMINGA VALDEZ, LUZVIMINDA
VOCINA, MADELINE VIVERO, RUFINA VELASCO, AUREA VIDALEON, GLORIA DEL VALLE, THELMA VALLOYAS, CYNTHIA
DELA VEGA, ADELA VILLAGOMEZ, TERESITA VINLUAN, EUFEMIA VITAN, GLORIA VILLAFLORES, EDORACION VALDEZ,
ANGELITA VALDEZ, ILUMINADA VALENCI, MYRNA VASQUEZ, EVELYN VEJERAMO, TEODORA VELASQUEZ, EDAN
VILLANUEVA, PURITA VILLASENOR, SALVADOR WILSON, EMELINA YU, ADELFA YU, ANA ABRIGUE, VIRGINIA ADOBAS,
VICTORIA ANTIPUESTO, MERCEDITA CASTILLO, JOCELYN CASTRO, CREMENIA DELA CRUZ, JOSEPHINE IGNACIO,
MELITA ILILANGOS, LIGAYA LUMAYAT, DELIA LUMBES, ROSITA LIBRADO, DELIA LAGRAMADA, GEMMA MAGPANTAY,
EMILY MENDOZA, FIDELA PANGANIBAN, LEONOR RIZALDO, ILUMINDA RIVERA, DIVINA SAMBAYAN, ELMERITA
SOLAYAO, NANCY SAMALA, JOSIE SUMARAN, LUZVIMINDA ABINES, ALMA ACOL, ROBERTO ADRIATICO, GLORIA
AGUINALDO, ROSARIO ALEYO, CRISTETA ALEJANDRO, LILIA ALMOGUERA, CARMEN AMARILLO, TRINIDAD ARDANIEL,
CERINA AVENTAJADO, ZENAIDA AVAYA, LOLITA ARABIS, MARIA ARSENIA, SOFIA AGUINALDO, SALVE ABAD, JOSEFINA
AMBANGAN EMILIA AQUINO, JOSEFINA AQUINO, JULIANA AUSAN, AMERCIANA ACOSTA, CONCEPCION ALEROZA,
DIANA ADOVOS, FELY ADVINCULA, SEOMINTA ARIAS, JOSEPHINE ARCEDE, NORMA AMISTOSO, PRESENTACION
ALONOS, EMMA ATIENZA, LEONIDA AQUINO, ANITA ARILLON, ADELAIDA ARELLANO, NORMA AMISTOSO, JOSEPHINE
ARCEDE, SEMIONITA ARIAS, JOSEFINA BANTUG, LOLITA BARTE, HERMINIA BASCO, MARGARITA BOTARDO, RUFINO
BUGNOT, LOLITA BUSTILLO, ISABEL BALAKIT, ROSARIO BARRERO, TESSIE BALBOS, NORMA BENISANO, GUILLERMA
BRUGES, BERNADETTE BARTOLOME, SHIRLEY BELMONTE, MERONA BELZA, AZUCENA BERNALES, JOSE BASCO,
NIMPHA BANTOG, BENILDA BUBAN, REGINA BUBAN, SALOME BARRAMEDA, IRENE BISCO, FELICITAS BAUTISTA,
VIOLETA BURA, LINA BINUYA, BIBIANA BAARDE, ELSA BAES, ANASTACIA BELONZO, SONIA BENOYO, ELIZABETH
BACUNGAN, PATRICIA BARRAMEDA, ERLINDA BARCELONA, EMMA BANICO, APOLONIA BUNAO, LUCITA BOLEA,
PACIFICA BARCELONA, EDITHA BASIJAN, RENITA BADAMA, ELENA BALADAD, CRESENCIA BAJO, BERNADITA BASILID,
MELINDA BEATO, YOLANDA BATANES, EDITHA BORILLA, ANITA BAS, ELSA CALIPUNDAN, MARIA CAMERINO, VIRGINIA
CAMPOSANO, MILAGROS CAPILI, CARINA CARINO, EUFEMIA CASIHAN, NENITA CASTRO, FLORENCIA CASUBUAN,
GIRLIE CENTENO, MARIANITA CHIQUITO, IMELDA DELA CRUZ, TEODOSIA CONG, TEOFILA CARACOL, TERESITA
CANTA, IRENEA CUNANAN, JULITA CANDILOSAS, VIOLETA CIERES, MILAGROS DELA CRUZ, FLOREPES CAPULONG,
CARMENCITA CAMPO, MARILYN CARILLO, RUTH DELA CRUZ, RITA CIJAS, LYDIA CASTOR, VIRGIE CALUBAD, EMELITA
CABERA, CRISTETA CRUZ, ERLINDA COGADAS, IMELDA CALDERON, SUSIE LUZ CEZAR, ESTELA CHAVEZ, NORMA
CABRERA, ELDA DAGATAN, LEONISA DIMACUNA, ERNA DUGTONG, FLORDELISA DIGMA, VIRGILIO DADIOS, LOLITA
DAGTA, ADELAIDA DORADO, CELSA DATUMANONG, VIRGINIA DOCTOLERO, EDNA SAN DIEGO, JULIETA DANG,
JULIETA DORANTINAO, LOLITA DAGANO, JUDITH DIAZ, MARIA ENICANE, MARITA ESCARDE, ENRIMITA ESMAYOR,
ROSARIO EPIRITU, REMEDIOS EMBOLTORIO, IRENE ESTUITA, TERESITA ERESE, ERMELINDA ELEZO, MARIA
ESTAREJA, MERLITA ESQUERRA, YOLANDA FELICITAS, FRUTO FRANCIA, MARTHA FRUTO, LILIA FLORES, SALVACION
FORTALESA, JUDITH FAJARDO, SUSANA FERNANDO, EDWIN FRANCISCO, NENITA GREGORY, ROSA CAMILO, MARIVIC
GERRARDO, CHARITA GOREMBALEM, NORMA GRANDE, DOLORES GUTIERREZ, CHARLIE GARCIA, LUZ GALVEZ,
ADELAIDA GAMILLA, LUZ GAPULTOS, ERLINDA GARCIA, HELEN GARCIA, ERLINDA GAUDIA, FRANCISCA GUILING,
MINTA HERRERA, ASUNCION HONOA, JUAN HERNANDEZ, LUCERIA ANNA MAE HERNANDEZ, JULIANA HERNANDEZ,
EDITHA IGNACIO, ANITA INOCENCIO, EULALIA INSORIO, ESTELITA IRLANDA, MILAGROS IGNACIO, LINDA JABONILLO,
ADELIMA JAEL, ROWENA JARABJO, ROBERT JAVILINAR, CLARITA JOSE, CARMENCITA JUNDEZ, SOFIA LALUCIS,
GLORIA LABITORIA, ANGELITA LODES, ERLINDA LATOGA, EVELYN LEGASPI, ROMEO LIMCHOCO, JESUS LARA,
ESTRELLA DE LUNA, LORETA LAREZA, JOSEPHINE ALSCO, MERCY DE LEON, CONSOLACION LIBAO, MARILYN LIWAG,
TERESITA LIZAZO, LILIA MACAPAGAL, SALVACION MACAREZA, AMALIA MADO, TERESITA MADRIAGA, JOVITA
MAGNAYE, JEAN MALABAD, FRANCISCA MENDOZA, NELCITA MANGANTANG, TERESITA NELLA, GENEROZA
MERCADO, CRISTETA MOJANA, BERNARDA MONGADO, LYDIA MIRANDA, ELISA MADRILEJOS, LOIDA MAGSINO,
AMELIA MALTO, JULITA MAHIBA, MYRNA MAYORES, LUISA MARAIG, FLORENCIA MARAIG, EMMA MONZON, IMELDA
MAGDANGAN, VICTORIA MARTIN, NOEMI MANGUILLO, BASILIZA MEDINA, VICTORIO MERCADO, ESTELA MAYPA,
EMILIA MENDOZA, LINA MAGPANTAY, FELICIANA MANLOLO, ELENA MANACOP, WILMA MORENO, JUANA MENDOZA,
EVELYN DEL MUNDO, ROSIE MATUTINA, MATILDE MANALO, TERESITA MENDEZ, FELIPINA MAGONCIA, MARIA
MANZANO, LIGAYA MANALO, LETICIA MARCHA, MARINA MANDIGMA, LETICIA MANDASOC, PRESCILLA MARTINEZ,
JULIA MENDOZA, PACITA MAGALLANES, ANGELINA MARJES, SHIRLEY MELIGRITO, IRENE MERCADO, ELISA
MAATUBANG, MARCELINA NICOLAS, AGUSTINA NICOLAS, ROSA NOLASCO, WILMA NILAYE, VIOLETA ORACION,
ANGELA OSTAYA, JUANITA OSAYOS, MAGDALENA OCAMPO, MARDIANA OCTA, ROSELA OPAO, LIBRADA OCAMPO,
YOLANDA OLIVER, MARCIA ORLANDA, PAGDUNAN, RITA PABILONA, MYRA PALACA, BETHLEHEM PALINES, GINA
PALIGAR, NORMA PALIGAR, DELMA PEREZ, CLAUDIA PRADO, JULIE PUTONG, LUDIVINA PAGSALINGAN, MERLYN
PANALIGAN, VIOLETA PANAMBITAN, NOREN PAR, ERLINDA PARAGAS, MILA PARINO, REBECCA PENAFLOR, IMELDA
PENAMORA, JERMICILLIN PERALTA, REBECCA PIAPES, EDITHA PILAR, MAROBETH PILLADO, DIOSCORO PIMENTEL,
AURORA LAS PINAS, EVANGELINA PINON, MA. NITA PONDOC, MA. MERCEDES PODPOD, ANGELITO PANDEZ, LIGAYA
PIGTAIN, LEONILA QUIAMBAO, ELENA QUINO, MARITESS QUIJANO, CHOLITA REBUENO, LOLITA REYES, JOCELYN
RAMOS, ROSITA RAMIREZ, ELINORA RAMOS, ISABEL RAMOS, ANNABELLE RESURRECCION, EMMA REYES, ALILY
ROXAS, MARY GRACE DELOS REYES, JOCELYN DEL ROSARIO, JOSEFINA RABUSA, ANGELITA ROTAIRO, SAMCETA
ROSETA, EDERLINA RUIZ, ZENAIDA ROSARIO, BENITA REBOLA, ROSITA REVILLA, ROSITA SANTOS, ROWENA
SALAZAR, EMILYN SARMIENTO, ANA SENIS, ELOISA SANTOS, NARCISA SONGLIAD, ELMA SONGALIA, AMPARA SABIO,
JESSIE SANCHEZ, VIVIAN SAMILO, GLORIA SUMALINOG, ROSALINA DELOS SANTOS, MARIETA SOMBRERO, HELEN
SERRETARIO, TEODORO SULIT, BELLA SONGUINES, LINDA SARANTAN, ESTELLA SALABAR, MILAGROS SISON,
GLORIA TALIDAGA, CECILIA TEODORO, ROMILLA TUAZON, AMELITA TABULAO, MACARIA TORRES, LUTGARDA TUSI,
ESTELLA TORREJOS, VICTORIA TAN, MERLITA DELA VEGA, WEVINA ORENCIA, REMEDIOS BALECHA, TERESITA
TIBAR, LACHICA LEONORA, JULITA YBUT, JOSEFINA ZABALA, WINNIE ZALDARIAGA, BENHUR ANTENERO, MARCELINA
ANTENERO, ANTONINA ALAPAN, EDITHA ANTOZO, ROWENA ARABIT, ANDRA AQUINO, TERESITA ANGULO, MARIA
ANGLO, MYRNA ALBOS, ELENITA AUSTRIA, ANNA ABRIGUE, VIRGINIA ADOBAS, VICTORIA ANTIPUESTO, REMEDIOS
BOLECHE, MACARIA BARRIOS, THELMA BELEN, ESTELLA BARRETTO, JOCELYN CHAVEZ, VIRGINIA CAPISTRANO,
BENEDICTA CINCO, YOLLY CATPANG, REINA CUEVAS, VICTORIA CALANZA, FE CASERO, ROBERTA CATALBAS,
LOURDES CAPANANG, CLEMENCIA CRUZ, JOCELYN COSTO, MERCEDITA CASTILLO, EDITHA DEE, LUCITA DONATO,
NORMA ESPIRIDION, LORETA FERNANDEZ, AURORA FRANCISCO, VILMA FAJARDO, MODESTA GABRENTINA,
TERESITA GABRIEL, SALVACION GAMBOA, JOSEPHINE IGNACIO, SUSAN IBARRA, ESPERANZA JABSON, OSCAR
JAMBARO, ROSANNA JARDIN, CORAZON JALOCON, ZENAIDA LEGASPI, DELLA LAGRAMADA, ROSITA LIBRANDO,
LIGAYA LUMAYOT, DELIA LUMBIS, LEONORA LANCHICA, RELAGIA LACSI, JOSEFINA LUMBO, VIOLETA DE LUNA,
EVELYN MADRID, TERESITA MORILLA, GEMMA MAGPANTAY, EMILY MENDOZA, IRENEA MEDINA, NARCISA MABEZA,
ROSANNA MEDINA, DELIA MARTINEZ, ROSARIO MAG-ISA, EDITHA MENDOZA, EDILBERTA MENDOZA, FIDELA
PANGANIBAN, OFELIA PANGANIBAN, AZUCENA POSTGO, LOURDES PACHECO, LILIA PADILLA, MARISSA PEREZ,
FLORDELIZA PUMARES, LUZ REYES, NORMA RACELIS, LEONOR RIZALDO, JOSIE SUMASAR, NANCY SAMALA,
EMERLITA SOLAYAO, MERCEDITA SAMANIEGO, BLANDINA SIMBULAN, JOCELYN SENDING, LUISITA TABERRERO,
TERESITA TIBAR, ESTERLINA VALDEZ, GLORIA VEJERANO, ILUMINADA VALENCIA, MERLITA DELA VEGA, VIRGIE
LAITAN, JULIET VILLARAMA, LUISISTA OCAMPO, NARIO ANDRES, ANSELMA TULFO, GLORIA MATEO, FLANIA
MENDOZA, CONNIE CANGO, EDITHA SALAZAR, MYRNA SANTOS, TERESITA SERGIO, CHARITO GILLA, FLORENTINA
HERNAEZ, BERNARDINO VIRGINIA, AMPO ANACORITA, SYLVIA POASADAS, ESTRELLA ESPIRITU, CONCORDIA
LUZURIAGA, MARINA CERBITO, EMMA REYES, NOEMI PENISALES, CLARITA POLICARPIO, BELEN BANGUIO, HERMINIA
ADVINCULA, LILIA MORTA, REGINA LAPIDARIO, LORNA LARGA, TERESITA VINLUAN, MARITA TENOSO, NILDS SAYAT,
THELMA SARONG, DELMA REGALIS, SUSAN RAFAULO, ELENA RONDINA, MYRNA PIENDA, VIOLETA DUMELINA,
FLORENCIA ADALID, FILMA MELAYA, ERLINDA DE BAUTISTA, MATILDE DE BLAS, DOLORES FACUNDO, REBECCA
LEDAMA, MA. FE MACATANGAY, EMELITA MINON, NORMA PAGUIO, ELIZA VASQUEZ, GLORIA VILLARINO, MA. JESUS
FRANCISCO, TERESITA GURPIDO, LIGAYA MANALO, FE PINEDA, MIRIAM OCMAR, LUISA SEGOVIA, TEODY ATIENZA,
SOLEDA AZCURE, CARMEN DELA CRUZ, DEMETRIA ESTONELO, MA. FLORIDA LOAZNO, IMELDA MAHIYA, EDILBERTA
MENDOZA, SYLVIA POSADAS, SUSANA ORTEGA, JOSEPHINE D. TALIMORO, TERESITA LORECA, ARSENIA TISOY,
LIGAYA MANALO, TERESITA GURPIO, FE PINEDA, and MARIA JESUS FRANCISCO, Petitioners, v. HON. CRESENCIO J.
RAMOS, NATIONAL LABOR RELATIONS COMMISSION, M. GREENFIELD (B), INC., SAUL TAWIL, CARLOS T. JAVELOSA,
RENATO C. PUANGCO, WINCEL LIGOT, MARCIANO HALOG, GODOFREDO PACENO, SR., GERVACIO CASILLANO,
LORENZO ITAOC, ATTY. GODOFREDO PACENO, JR., MARGARITO CABRERA, GAUDENCIO RACHO, SANTIAGO IBANEZ,
AND RODRIGO AGUILING, Respondents.

RESOLUTION

GONZAGA-REYES, J.:

Before us is petitioners’ motion for partial reconsideration of our decision dated February 28, 2000, 1 the dispositive portion of
which reads: 2

"WHEREFORE, the petition is GRANTED; the decision of the National Labor Relations Commission in Case No. NCR-00-09-
04199-89 is REVERSED and SET ASIDE; and the respondent company is hereby ordered to immediately reinstate the petitioners
to their respective positions. Should reinstatement be not feasible, respondent company shall pay separation pay of one month
salary for every year of service. Since petitioners were terminated without the requisite written notice at least 30 days prior to their
termination, following the recent ruling in the case of Ruben Serrano v. National Labor Relations Commission and Isetann
Department Store, the respondent company is hereby ordered to pay full backwages to petitioner-employees while the Federation
is also ordered to pay full backwages to petitioner-union officers who were dismissed upon its instigation. Since the dismissal of
petitioners was without cause, backwages shall be computed from the time the herein petitioner employees and union officers
were dismissed until their actual reinstatement. Should reinstatement be not feasible, their backwages shall be computed from the
time petitioners were terminated until the finality of this decision. Costs against the respondent company.chanrob1es virtua1 1aw
1ibrary

SO ORDERED."cralaw virtua1aw library

Petitioners allege that this Court committed patent and palpable error in holding that "the respondent company officials cannot be
held personally liable for damages on account of employees’ dismissal because the employer corporation has a personality
separate and distinct from its officers who merely acted as its agents" whereas the records clearly established that respondent
company officers Saul Tawil, Carlos T. Javelosa and Renato C. Puangco have caused the hasty, arbitrary and unlawful dismissal
of petitioners from work; that as top officials of the respondent company who handed down the decision dismissing the petitioners,
they are responsible for acts of unfair labor practice; that these respondent corporate officers should not be considered as mere
agents of the company but the wrongdoers. Petitioners further contend that while the case was pending before the public
respondents, the respondent company, in the early part of February 1990, began removing its machineries and equipment from its
plant located at Merville Park, Parañaque and began diverting jobs intended for the regular employees to its sub-
contractor/satellite branches; 3 that the respondent company officials are also the officers and incorporators of these satellite
companies as shown in their articles of incorporation and the general information sheet. They added that during their ocular
inspection of the plant site of the respondent company, they found that the same is being used by other unnamed business
entities also engaged in the manufacture of garments. Petitioners further claim that the respondent company no longer operates
its plant site as M. Greenfield thus it will be very difficult for them to fully enforce and implement the court’s decision. In their
subsequent motion filed on the same day, petitioners also pray for the (A) inclusion of the names of employees listed in Annex "D"
of the petition which they inadvertently omitted in the caption of the case, to wit: (1) Amores, Imelda (2) Andres, Josefina (3)
Aragon, Felicidad (4) Arias, Genevive (5) Arroyo, Salvacion (6) Arceo, Elizabeth (7) Añonuevo, Monica (8) Abellada, Josefina (9)
Advincula, Harmelina (10) Ajayo, Rosario (11) Alilay, Marilyn (12) Almario, Anliza (13) Almario, Angelita (14) Almazan, Marilou
(15) Almonte, Rosalina (16) Alvaran, Marites (17) Alvarez, Edna (18) Ampo, Anacorita (19) Aquino, Leonisa (20) Bactat, Celia (21)
Carpio, Azucena G. (22) Cruz, Amelia (23) Glifonia, Eugenia (24) Escurel, Evelyn F. (25) Hilario, Bonifacio G. (26) Payuan,
Adoracion (27) Perez, Mercedita (28) Rempis, Zenaida (29) Rosario, Margie del (30) Salvador, Norma (31) Sambayanan, Olivia
(32) Tiaga, Aida (33) Torbela, Maria (34) Trono, Nenevina (35) Varona, Asuncion (36) Vasquez, Elisa M. (37) Villanueva, Milagros
(38) Villapondo, Eva C. (39) Villon, Adeliza T.; (B) correction of their own typographical errors of the names of employees
appearing in the caption, which should be as follows: Manuela Avelin, Belen Barquio, Lita Buquid, Violeta C. Ciervo, Marilou
Dejocos, Maximina Faustino, Primitiva Gomez, Myrna Palaca, Mercedita Perez, Rebecca Poceran, Amorlita Rotairo, Emma
Saludario, Tita Senis, Salvacion Wilson, 4 Anita Ahillon, Gregoria Arguelles, Tessie Balbis, Betty Borja, Rodrigo Buella, Celsa
Doropan, Maria Enicame, Josephine Lasco, Julita Maniba, Juanita Osuyos, Juana Overencio, Azucena Postigo, Cristina Rapinan,
Roselyn Rivero, Edeltrudes Romero, Rodelia Royandoyon, Fausta Segundo, Teodora Sulit, Elena Tebis, Paulina Valdez, 5 Susan
Abogona, Diana Adovas, Carmen Rosimo Basco, Macaria Barrion, Maria Fe Berezo, Matilde de Blas, Rufina Bugnot, Aurora
Bravo, Jovita Cera, Precila Carta, Amalia Eugenio, Milagros Fonseca, Jose Irlanda, Rowena Jarabejo, Regina Lapidario, Josie
Marcos, Shirley Melegrito, Noemi Menguillo, Teresita Nierves, Ricardo Paloga, Florenia Ragos, Leonila Rodil, Emma Saludario,
Narcisa Songuad, Josie Sumarsar, Evangeline Tayco; 6 (C) inclusion of other employees similarly situated whose names were
not included in Annex "D" or in the caption of the case, to wit: (1) Dionisa Aban, (2) Alicia Aragon, (3) Vicky Francia, (4) Nelita F.
Gelongos, (5) Erlinda San Juan, (6) Erlinda Baby Patungan Manalo, (7) Jenette Patungan, 7 (8) Blandina Simbahan, 8 (9)
Asuncion Varona, 9 (10) Josefina Andres, (11) Teresita Arales, (12) Alice Artikulo, (13) Esther Cometa, (14) Eliza Cabiting, (15)
Erlinda Dalut, (16) Edna Fernandez, (17) Emily Inocencio, (18) Esperanza Jalocon, (19) Imelda Jarabe, (20) Mercedes Pabadora,
(21) Venerado Pastoral, (22) Cristina Perlas, (23) Margie del Rosario. 10

In their Comment, the Solicitor General interposes no objection to petitioners’ prayer for the inclusion of omitted and similarly
situated employees and the correction of employees’ names in the caption of the case.

On the other hand, private respondent company officials Carlos Javelosa and Remedios Caoleng, in their Comment, state that
considering that petitioners admitted having knowledge of the fact that private respondent officers are also holding key positions in
the alleged satellite companies, they should have presented the pertinent evidence with the public respondents; thus it is too late
for petitioners to require this Court to admit and evaluate evidence not presented during the trial; that the supposed proof of
satellite companies hardly constitute newly discovered evidence. Respondent officials interpose no objection to the inclusion of
employees inadvertently excluded in the caption of the case but object to the inclusion of employees who were allegedly similarly
situated for the reason that these employees had not been parties to the case, hence should not be granted any relief from the
court. Respondent company failed to file its comment. 11

Petitioners’ contention that respondent company officials should be made personally liable for damages on account of petitioners’
dismissal is not impressed with merit. A corporation is a juridical entity with legal personality separate and distinct from those
acting for and in its behalf and, in general from the people comprising it. 12 The rule is that obligations incurred by the corporation,
acting through its directors, officers and employees, are its sole liabilities. 13 True, solidary liabilities may at times be incurred but
only when exceptional circumstances warrant such as, generally, in the following cases: 14

1. When directors and trustees or, in appropriate cases, the officers of a corporation —chanrob1es virtua1 1aw 1ibrary

(a) Vote for or assent to patently unlawful acts of the corporation;

(b) act in bad faith or with gross negligence in directing the corporate affairs;

(c) are guilty of conflict of interest to the prejudice of the corporation, its stockholders or members, and other persons. 15

(2) When a director or officer has consented to the issuance of watered stocks or who, having knowledge thereof, did not forthwith
file with the corporate secretary his written objection thereto. 16

(3) When a director, trustee or officer has contractually agreed or stipulated to hold himself personally and solidarily liable with the
Corporation. 17

(4) When a director, trustee or officer is made, by specific provision of law, personally liable for his corporate action. 18

In labor cases, particularly, the Court has held corporate directors and officers solidarily liable with the corporation for the
termination of employment of corporate employees done with malice or in bad faith. 19 Bad faith or negligence is a question of
fact and is evidentiary. 20 It has been held that bad faith does not connote bad judgment or negligence; it imports a dishonest
purpose or some moral obliquity and conscious doing of wrong; it means breach of a known duty thru some motive or interest or ill
will; it partakes of the nature of fraud. 21

In the instant case, there is nothing substantial on record to show that respondent officers acted in patent bad faith or were guilty
of gross negligence in terminating the services of petitioners so as to warrant personal liability. As held in Sunio v. NLRC, 22

"We now come to the personal liability of petitioner, Sunio, who was made jointly and severally responsible with petitioner
company and CIPI for the payment of the backwages of private respondents. This is reversible error. The Assistant Regional
Director’s Decision failed to disclose the reason why he was made personally liable. Respondents, however, alleged as grounds
thereof, his being the owner of one half (1/2) interest of said corporation, and his alleged arbitrary dismissal of private
respondents.

Petitioner Sunio was impleaded in the Complaint in his capacity as General Manager of petitioner corporation. There appears to
be no evidence on record that he acted maliciously or in bad faith in terminating the services of private respondents. His act,
therefore, was within the scope of his authority and was a corporate act.

It is basic that a corporation is invested by law with a personality separate and distinct from those of the persons composing it as
well as from that of any other legal entity to which it may be related. Mere ownership by a single stockholder or by another
corporation of all or nearly all of the capital stock of a corporation is not of itself sufficient ground for disregarding the separate
corporate personality. Petitioner Sunio, therefore, should nor have been made personally answerable for the payment of private
respondents’ back salaries."cralaw virtua1aw library

Petitioners’ claim that the jobs intended for the respondent company’s regular employees were diverted to its satellite companies
where the respondent company officers are holding key positions is not substantiated and was raised for the first time in
consideration. Even assuming that the respondent company officials are also officers and incorporators of the satellite companies,
such circumstance does not in itself amount to fraud. The documents attached to petitioners’ motion for reconsideration show that
these satellite companies 23 were established prior to the filing of petitioners’ complaint against private respondents with the
Department of Labor and Employment on September 6, 1989 and that these corporations have different sets of incorporators
aside from the respondent officers and are holding their principal offices at different locations. Substantial identity of incorporators
between respondent company and these satellite companies does not necessarily imply fraud. 24 In such a case, respondent
company’s corporate personality remains inviolable.25cralaw:red

Although there were earlier decisions of this Court in labor cases where corporate officers were held to be personally liable for the
payment of wages and other money claims to its employees, we find those rulings inapplicable to this case. In La Campana
Coffee Factory, Inc. v. Kaisahan ng Manggagawa sa La Campana (KKM), 26 La Campana Coffee Factory, Inc. and La Campana
Gaugau Packing were substantially owned by the same person. They had one office, one management, and a single payroll for
both businesses. The laborers of the gaugau factory and the coffee factory were also interchangeable, i.e., the workers in one
factory worked also in the other factory.chanrob1es virtua1 1aw 1ibrary

In Claparols v. Court of Industrial Relations, 27 the Claparol Steel and Nail Plant which was ordered to pay its workers
backwages, ceased operations on June 30, 1957 and was succeeded on the next day, July 1, 1957 by the Claparols Steel
Corporation. Both corporations were substantially owned and controlled by the same person and there was no break or cessation
in operations. Moreover, all the assets of the steel and nail pant were transferred to the new corporation.

Notably, in the above-mentioned cases, a new corporation was created, owned by the same family, engaged in the same
business and operating in the same compound, a situation which is not obtaining in the instant case.

In AC Ransom Labor Union-CCLU v. NLRC, 28 the Court ruled that under the Minimum Wage Law, the responsible officer of an
employer corporation can be held personally liable for non-payment of backwages for "if the policy of the law were otherwise, the
corporation employer would have devious ways for evading of back wages." This Court said:jgc:chanrobles.com.ph

"In the instant case, it would appear that RANSOM, in 1969, foreseeing the possibility or probability of payment of backwages to
the 22 strikers, organized ROSARIO to replace RANSOM, with the latter to be eventually phased out if the 22 strikers win their
case. RANSOM actually ceased operations on May 1, 1973, after the December 19, 1972 Decision of the Court of Industrial
Relations was promulgated against RANSOM."cralaw virtua1aw library

Clearly, the situation in AC Ransom does not obtain in this case, where the alleged satellite companies were established even
prior to the filing of petitioners’ complaint with the Department of Labor.

Petitioners’ prayer for the inclusion of employees listed in Annex "D" whose names were admittedly inadvertently excluded in the
caption of the case and for the correction of typographical errors of the employees’ names appearing in the caption, is well taken
and is hereby granted. However, petitioners’ prayer for the inclusion of other employees allegedly similarly situated but whose
names were not included either in Annex "D" or in the caption of the case must be denied. A judgment cannot bind persons who
are not parties to the action. 29 It is elementary that strangers to a case are not bound by the judgment rendered by the court and
such judgment is not available as an adjudication either against or in favor of such other person. 30 Petitioners failed to explain
why these employees allegedly similarly situated were not included in the submitted list filed before us. Such inclusion would be
tantamount to a substantial amendment which cannot be allowed at this late stage of the proceedings as it will definitely work to
the prejudice and disadvantage of the private respondents. 31

WHEREFORE, petitioners’ motion for reconsideration is partially granted so as to include the names of employees listed in Annex
"D" which petitioners inadvertently omitted in the caption of this case, to wit: (1) Amores, Imelda (2) Andres, Josefina (3)Aragon,
Felicidad (4) Arias, Genevive (5) Arroyo, Salvacion (6) Arceo, Elizabeth (7) Añonuevo, Monica (8) Abellada, Josefina (9)
Advincula, Harmelina (10) Ajayo, Rosario (11) Alilay, Marilyn (12) Almario, Anliza (13) Almario, Angelita (14) Almazan, Marilou
(15) Almonte, Rosalina (16) Alvaran, Marites (17) Alvarez, Edna (18) Ampo, Anacorita (19) Aquino, Leonisa (20) Bactat, Celia (21)
Carpio, Azucena G. (22) Cruz, Amelia (23) Glifonia, Eugenia (24) Escurel, Evelyn F. (25) Hilario, Bonifacio G. (26) Payuan,
Adoracion (27) Perez, Mercedita (28) Rempis, Zenaida (29) Rosario, Margie deL (30) Salvador, Norma (31) Sambayanan, Olivia
(32) Tiaga, Aida (33) Torbela, Maria (34) Trono, Nenevina (35) Varona, Asuncion (36) Vasquez, Elisa M. (37) Villanueva, Milagros
(38) Villapondo, Eva C. (39) Villon, Adeliza T.; and to correct the typographical errors of the names of employees appearing in the
caption, as follows: Manuela Avelin, Belen Barquio, Lita Buquid, Violeta C. Ciervo, Marilou Dejocos, Maximina Faustino, Primitiva
Gomez, Myrna Palacaz Mercedita Perez, Rebecca Poceran, Amorlita Rotairo, Emma Saludario, Tita Senis, Salvacion Wilson,
Anita Ahillon. Gregoria Arguelles, Tessie Balbis, Betty Borja, Rodrigo Buella, Celsa Doropan, Maria Enicame, Josephine Lasco,
Julita Maniba, Juanita Osuyos, Juana Overencio, Azucena Postigo, Cristina Rapinan, Roselyn Rivero, Edeltrudes Romero,
Rodelia Royandoyon, Fausta Segundo, Teodora Sulit, Elena Tebis, Paulina Valdez, Susan Abogona, Diana Adovas, Carmen
Rosimo Basco, Macaria Barrion, Maria Fe Berezo, Matilde de Blas, Rufina Bugnot, Aurora Bravo, Jovita Cera, Precila Carta,
Amalia Eugenio, Milagros Fonseca, Jose Irlanda, Rowena Jarabejo, Regina Lapidario, Josie Marcos, Shirley Melegrito, Noemi
Menguillo, Teresita Nierves, Ricardo Paloga, Florenia Ragos, Leonila Rodil, Emma Saludario, Narcisa Songuad, Josie Sumarsar,
Evangeline Tayco.chanrob1es virtua1 1aw 1ibrary

SO ORDERED.
5. Cruzvale, Inc. v. Hon. Laguesma, G.R. No. 107610, 25 November 1994
[G.R. No. 107610. November 25, 1994.]

CRUZVALE, INC., Petitioner, v. HON. BIENVENIDO E. LAGUESMA, UNDERSECRETARY OF THE DEPARTMENT OF

LABOR AND EMPLOYMENT, MED-ARBITER ANGELI M. TUYAY AND UNION OF FILIPINO WORKERS (UFW),
Respondents.

SYLLABUS

1. REMEDIAL LAW; EVIDENCE; FINDINGS OF FACT OF ADMINISTRATIVE BODIES, GENERALLY CONCLUSIVE ON

APPEAL; CASE AT BAR. — As to the first assigned error, petitioner avers that private respondent is not a legitimate labor
organization, "considering that its local or chapter, at the time said petition was filed, did not undergo the rudiments of
registration required under Section 3, Rule II, Book V of the Implementing Rules and Regulations of the Labor Code and
the pronouncements made by this Court in Progressive Development Corporation v. Secretary, Department of Labor and
Employment (205 SCRA 802) . . .." The Med-Arbiter found that private respondent was issued Certificate of Registration
No. 11106 and Charter Certificate No. 82. Findings of fact of labor officials are generally conclusive and binding upon this
Court when supported by substantial evidence (Five J Taxi v. National Labor Relations Commission, 212 SCRA 225
[1992]).

2. LABOR AND SOCIAL LEGISLATION; LABOR CODE; LABOR RELATIONS; CERTIFICATION ELECTION; SHOULD
COVER ONLY THOSE WHO SHARE COMMONALITY OF INTEREST. — As to the second assigned error, petitioner
claims that respondent Undersecretary should not have limited the certification election to petitioner’s employees at the
garment factory in Cainta but should have also covered those employed in the cinema business. We agree with the
following observation made by respondent Undersecretary in his Decision dated September 25, 1992: "As regards the
question on the composition of the bargaining unit, we stress once more that the call for the conduct of election covers all
the regular rank-and-file employees of Cruzvale, Inc. at its garment manufacturing corporation. The use of the pronoun
‘all’ in our decision dated 16 December 1991 refers to all aforementioned employees at the garment manufacturing
operation based on the finding that they were the ones sought to be represented by the petitioner as clearly reflected on
the face of the petition and as embodied in the Order of the Med-Arbiter dated 24 April 1992 which was affirmed by this
Office on appeal. Moreover, as stated in the questioned Decision the employees at the Cinema operation and those at the
garment manufacturing operation do not share commonality of interest as the former clearly perform work entirely different
from that of the latter. Thus, their separation into two (2) distinct bargaining units is proper. This is in accordance with the
decision of the Supreme Court in the case of Belyca Corporation v. Dir. Pura Ferrer-Calleja, Et Al., G.R. No. 77395, 26
November 1988" .

3. ID.; ID.; ID.; ID.; VENUE; TOUCHES MORE THE CONVENIENCE OF PARTIES RATHER THAN SUBSTANCE OF
THE CASE. — As to the third assigned error, petitioner contends that the petition for certification election should have
been filed with the regional office which has jurisdiction over the principal office of the employer in accordance with
Section 1, Rule V, Book V of the Omnibus Rules Implementing the Labor Code. Said section provides: "Where to file. A
petition for certification election shall be filed with the Regional Office which has jurisdiction over the principal office of the
Employer. The petition shall be in writing and under oath." The word "jurisdiction" as used in said provision refers to the
venue where the petition for certification must be filed. Unlike jurisdiction, which implies the power of the court to decide a
case, venue merely refers to the place where the action shall be brought (Sulo ng Bayan, Inc. v. Intermediate Appellate
Court, 72 SCRA 347 [1976]). Venue touches more the convenience of the parties rather than the substance of the case
(Consolidated Bank v. Intermediate Appellate Court, 198 SCRA 34 [1991]).

4. ID.; ID.; ID.; ID.; ID.; WHERE PLACE OF WORK AND PLACE OF PRINCIPAL OFFICE OF EMPLOYER ARE
LOCATED IN DIFFERENT TERRITORIAL JURISDICTION OF REGIONAL OFFICES, CERTIFICATION MAY BE FILED
WITH THE REGIONAL OFFICE OF THE PLACE OF BUSINESS; REASON. — Section 1, Rule V, Book V of the Omnibus
Rules Implementing the Labor Code refers only to cases where the place of work of the employees and the place of the
principal office of the employer are within the same territorial jurisdiction of the Regional Office where the petition for
certification election is filed. The said provision does not apply to the filing of petitions for certification election where the
place of work of the employees and the place of principal office of the employer are located within the territorial jurisdiction
of different regional offices. We assume that in the drafting of the Omnibus Rules, the Secretary of Labor and Employment
took into consideration the fact that there are many companies with factories located in places different from places where
corporate offices are located. The worker, being the economically-disadvantaged party whether as complainant, petitioner
or respondent, as the case may be, the nearest governmental machinery to settle a labor dispute must be placed at his
immediate disposal and the employer must in no case be allowed a choice in favor of another competent agency sitting in
another place to the inconvenience of the worker (Nestle Philippines, Inc. v. National Labor Relations Commission, 209
SCRA 834 [1992]). Petitioner has not shown how it will be prejudiced by the hearing on the petition for certification
election before the Regional Office No. IV, which has its offices in Quezon City, the same city where the principal place of
business of petitioner is located. Petitioner is, therefore, being unreasonable in demanding that the petition for certification
election be filed with the National Capital Region Office, which holds offices in Manila.

5. ID.; ID.; ID.; ID.; ID.; NEW RULE ON VENUE. — Unlike in the Rules governing the procedure before Regional Offices,
the New Rules of Procedure of the National Labor Relations Commission prescribes that all cases in which labor arbiters
have jurisdiction should be filed in the branch office which has territorial jurisdiction over the "workplace of the
complainant/petitioner" (Rule IV, Sec. 1[a]). The NLRC Rules defines the workplace as follows: "For purposes of venue,
workplace shall be understood as the place or locality where the employee is regularly assigned when the cause of action
arose. It shall include the place where the employee is supposed to report back after a temporary detail, assignment or
travel. . . . ."cralaw virtua1aw library

6. REMEDIAL LAW; SPECIAL CIVIL ACTION; CERTIORARI; FINDING OF THE MED-ARBITER THAT EMPLOYER
WAS BARRED FROM RAISING THE ISSUE OF IMPROPER VENUE, NOT A GRAVE ABUSE OF DISCRETION. — The
Omnibus Rules Implementing the Labor Code has no provision as to when an objection to improper venue may be raised.
The Med-Arbiter ruled that where the employer had appeared twice at the hearing of the petition for certification election
without questioning the venue, said employer was barred from raising the issue in the subsequent proceedings. He
observed: ". . . This practice of deliberately delaying the legal proceedings cannot be countenanced any further,
otherwise, the ends of justice will forever be defeated. We don’t see any reason for the respondent to delay as it did, the
proceedings of the case only to assail later on the jurisdiction of the office. This issue could have been brought up or
objected to during the initial hearing." The stance of the Med-Arbiter, that the question of the venue in representation
cases should be raised at the first hearing, was accepted by respondent Undersecretary. We are not prepared to say that
said administrative officials have gravely abused their discretion.

DECISION

QUIASON, J.:

This is a petition for certiorari under Rule 65 of the Revised Rules of Court, with prayer for a writ of preliminary injunction
or temporary restraining order, to reverse and set aside the Decision dated September 25, 1992 of respondent
Undersecretary of Labor and Employment and his Order dated October 13, 1992 in OS-MA-A-11-334-91.chanrobles
virtualawlibrary chanrobles.com:chanrobles.com.ph

On July 23, 1991, private respondent, a labor union, filed with the Department of Labor and Employment (DOLE),
Regional Office No. IV, a petition for certification election among the regular rank-and-file workers of petitioner, docketed
as Case No. RO-400-9107-RU-0107.

On August 27, 1991, petitioner filed its comment to the petition for certification election. It sought the denial of the petition
on the following grounds:chanrob1es virtual 1aw library

(a) That no charter certificate evidencing the organization of a local union therein was attached to the petition or submitted
to the DOLE at the time the petition was filed;

(b) That the respondent Union has not presented any proof that it is a legitimate labor organization; and

(c) That the Regional Office No. IV of the DOLE has no jurisdiction over the petition since petitioner Company’s place of
business is located at Cubao, Quezon City, which is outside the jurisdiction of the said Regional Office. Consequently, it is
the National Capital Region or NCR of the DOLE which has jurisdiction over said petition (Rollo, p. 7).

On September 27, 1991, respondent Med-Arbiter rendered a decision in favor of private respondent, pertinent portion of
which reads as follows:jgc:chanrobles.com.ph

"Anent the first issue on the status of the petitioner, it is established that the petitioner is a legitimate organization with
Dole Registration Certificate No. 11106 LC (FED) and has a local chapter in the respondent’s company located at Cainta,
Rizal. The existence of a local union is likewise undisputed as the same is evidenced by Charter Certificate No. 82 issued
to it by the petitioner, United Filipino Workers, and submitted to this Office which automatically forms part of the records of
this case.

As regards the second and third issues on whether or not the herein petition is duly filed or not, the allegation of the
respondent that the same is defective in form and substance since no charter certificate and signatories were attached
thereto at the time of filing of this petition is unmeritorious and without legal basis.

The respondent is an unorganized establishment which is governed by Article 257 of the Labor Code, as amended by
R.A. No. 6715, which read as follows:chanrob1es virtual 1aw library

Petitions in unorganized establishments. — In any establishment where there is no certified bargaining agent, a
certification election shall automatically be conducted by the Med-Arbiter upon the filing of a petition by a legitimate labor
organization (Rollo, pp. 74-75).

Petitioner appealed the said order to the DOLE. The latter, thru respondent Undersecretary, upheld the order of
respondent Med-Arbiter.

Not satisfied with the decision of the DOLE, petitioner filed the instant petition and assigned the following
errors:chanrob1es virtual 1aw library

RESPONDENT UNDERSECRETARY GRAVELY ABUSED HIS DISCRETION AMOUNTING TO LACK OF

JURISDICTION IN AFFIRMING A PATENTLY NULL AND VOID DECISION OF THE MED-ARBITER HOLDING THAT
THE PETITION FOR CERTIFICATION ELECTION WAS FILED BY A LEGITIMATE LABOR ORGANIZATION.

RESPONDENT UNDERSECRETARY GRAVELY ABUSED HIS DISCRETION AND COMMITTED A SERIOUS LEGAL
ERROR IN LIMITING THE CERTIFICATION ELECTION TO PETITIONER’S EMPLOYEES AT CAINTA, THEREBY
DISENFRANCHISING THE OTHER REGULAR RANK-AND-FILE EMPLOYEES OF PETITIONER COMPANY AND
INSPITE OF A FINAL ORDER CALLING FOR A CERTIFICATION ELECTION TO BE PARTICIPATED IN BY ALL
REGULAR RANK-AND-FILE EMPLOYEES.

RESPONDENT UNDERSECRETARY ACTED WITH GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF

JURISDICTION WHEN HE AMENDED OUT OF HIS OWN WILL AND DERIVED A PROVISION OF THE
IMPLEMENTING RULES WITHOUT ANY BASIS OR AUTHORITY IN THE LABOR CODE, AS AMENDED.

II

As to the first assigned error, petitioner avers that private respondent is not a legitimate labor organization, "considering
that its local or chapter, at the time said petition was filed, did not undergo the rudiments of registration required under
Section 3, Rule II, Book V of the Implementing Rules and Regulations of the Labor Code and the pronouncements made
by this Court in Progressive Development Corporation v. Secretary, Department of Labor and Employment (205 SCRA
802) . . ." (Rollo, pp. 13-14).chanrobles.com : virtual law library

The Med-Arbiter found that private respondent was issued Certificate of Registration No. 11106 and Charter Certificate
No. 82.

Findings of fact of labor officials are generally conclusive and binding upon this Court when supported by substantial
evidence (Five J Taxi v. National Labor Relations Commission, 212 SCRA 225 [1992]).

Progressive Development Corporation, (supra.) is inappropriate to the case at bench. Thereat, the union failed to show
that it had complied with the statutory requirements of Section 3, Rule II, Book V of the Omnibus Rules Implementing the
Labor Code. The copy of the constitution and by-laws and list of officers submitted to the Bureau of Labor Relations by the
union were not certified under oath by the union secretary.

As to the second assigned error, petitioner claims that respondent Undersecretary should not have limited the certification
election to petitioner’s employees at the garment factory in Cainta but should have also covered those employed in the
cinema business.

We agree with the following observation made by respondent Undersecretary in his Decision dated September 25,
1992:jgc:chanrobles.com.ph

"As regards the question on the composition of the bargaining unit, we stress once more that the call for the conduct of
election covers all the regular rank-and-file employees of Cruzvale, Inc. at its garment manufacturing corporation. The use
of the pronoun ‘all’ in our decision dated 16 December 1991 refers to all aforementioned employees at the garment
manufacturing operation based on the finding that they were the ones sought to be represented by the petitioner as
clearly reflected on the face of the petition and as embodied in the Order of the Med-Arbiter dated 24 April 1992 which
was affirmed by this Office on appeal.

Moreover, as stated in the questioned Decision the employees at the Cinema operation and those at the garment
manufacturing operation do not share commonality of interest as the former clearly perform work entirely different from
that of the latter. Thus, their separation into two (2) distinct bargaining units is proper. This is in accordance with the
decision of the Supreme Court in the case of Belyca Corporation v. Dir. Pura Ferrer-Calleja, Et Al., G.R. No. 77395, 26
November 1988 (Rollo, p. 42; Emphasis supplied).

As to the third assigned error, petitioner contends that the petition for certification election should have been filed with the
regional office which has jurisdiction over the principal office of the employer in accordance with Section 1, Rule V, Book
V of the Omnibus Rules Implementing the Labor Code (Rollo, p. 27). Said section provides:jgc:chanrobles.com.ph

"Where to file. A petition for certification election shall be filed with the Regional Office which has jurisdiction over the
principal office of the Employer. The petition shall be in writing and under oath (Emphasis supplied).

The word "jurisdiction" as used in said provision refers to the venue where the petition for certification must be filed. Unlike
jurisdiction, which implies the power of the court to decide a case, venue merely refers to the place where the action shall
be brought (Sulo ng Bayan, Inc. v. Intermediate Appellate Court, 72 SCRA 347 [1976]). Venue touches more the
convenience of the parties rather than the substance of the case (Consolidated Bank v. Intermediate Appellate Court, 198
SCRA 34 [1991]).chanrobles virtual lawlibrary

Section 1, Rule V, Book V of the Omnibus Rules Implementing the Labor Code refers only to cases where the place of
work of the employees and the place of the principal office of the employer are within the same territorial jurisdiction of the
Regional Office where the petition for certification election is filed. The said provision does not apply to the filing of
petitions for certification election where the place of work of the employees and the place of principal office of the
employer are located within the territorial jurisdictions of different regional offices. We assume that in the drafting of the
Omnibus Rules, the Secretary of Labor and Employment took into consideration the fact that there are many companies
with factories located in places different from places where the corporate offices are located.

The worker, being the economically-disadvantaged party whether as complainant, petitioner or respondent, as the case
may be, the nearest governmental machinery to settle a labor dispute must be placed at his immediate disposal and the
employer must in no case be allowed a choice in favor of another competent agency sitting in another place to the
inconvenience of the worker (Nestle Philippines, Inc. v. National Labor Relations Commission, 209 SCRA 834 [1992]).

Petitioner has not shown how it will be prejudiced by the hearing on the petition for certification election before the
Regional Office No. IV, which has its offices in Quezon City, the same city where the principal place of business of
petitioner is located. Petitioner is, therefore, being unreasonable in demanding that the petition for certification election be
filed with the National Capital Region Office, which holds offices in Manila.

Unlike in the Rules governing the procedure before Regional Offices, the New Rules of Procedure of the National Labor
Relations Commission prescribes that all cases in which labor arbiters have jurisdiction should be filed in the branch office
which has territorial jurisdiction over the "workplace of the complainant/petitioner" (Rule IV, Sec. 1[a]). The NLRC Rules
defines the workplace as follows:jgc:chanrobles.com.ph

"For purposes of venue, workplace shall be understood as the place or locality where the employee is regularly assigned
when the cause of action arose. It shall include the place where the employee is supposed to report back after a
temporary detail, assignment or travel. . . . ."cralaw virtua1aw library

The Omnibus Rules Implementing the Labor Code has no provision as to when an objection to improper venue may be
raised. The Med-Arbiter ruled that where the employer had appeared twice at the hearing of the petition for certification
election without questioning the venue, said employer was barred from raising the issue in the subsequent proceedings.
He observed:jgc:chanrobles.com.ph

". . . This practice of deliberately delaying the legal proceedings cannot be countenanced any further, otherwise, the ends
of justice will forever be defeated. We don’t see any reason for the respondent to delay as it did, the proceedings of the
case only to assail later on the jurisdiction of the office. This issue could have been brought up or objected to during the
initial hearing" (Rollo, p. 77).

The stance of the Med-Arbiter, that the question of the venue in representation cases should be raised at the first hearing,
was accepted by respondent Undersecretary. We are not prepared to say that said administrative officials have gravely
abused their discretion.

WHEREFORE, the petition is DISMISSED and the temporary restraining order is LIFTED.

SO ORDERED.
6. Sarmiento III v. Com. Mison, 156 SCRA 459 – ayaw pong lumabas ng 459
G.R. No. 79974 December 17, 1987

ULPIANO P. SARMIENTO III AND JUANITO G. ARCILLA, petitioners,

vs.
SALVADOR MISON, in his capacity as COMMISSIONER OF THE BUREAU OF CUSTOMS, AND GUILLERMO
CARAGUE, in his capacity as SECRETARY OF THE DEPARTMENT OF BUDGET, respondents, COMMISSION ON
APPOINTMENTS, intervenor.

PADILLA, J.:

Once more the Court is called upon to delineate constitutional boundaries. In this petition for prohibition, the petitioners,
who are taxpayers, lawyers, members of the Integrated Bar of the Philippines and professors of Constitutional Law, seek
to enjoin the respondent Salvador Mison from performing the functions of the Office of Commissioner of the Bureau of
Customs and the respondent Guillermo Carague, as Secretary of the Department of Budget, from effecting disbursements
in payment of Mison's salaries and emoluments, on the ground that Mison's appointment as Commissioner of the Bureau
of Customs is unconstitutional by reason of its not having been confirmed by the Commission on Appointments. The
respondents, on the other hand, maintain the constitutionality of respondent Mison's appointment without the confirmation
of the Commission on Appointments.

Because of the demands of public interest, including the need for stability in the public service, the Court resolved to give
due course to the petition and decide, setting aside the finer procedural questions of whether prohibition is the proper
remedy to test respondent Mison's right to the Office of Commissioner of the Bureau of Customs and of whether the
petitioners have a standing to bring this suit.

By the same token, and for the same purpose, the Court allowed the Commission on Appointments to intervene and file a
petition in intervention. Comment was required of respondents on said petition. The comment was filed, followed by
intervenor's reply thereto. The parties were also heard in oral argument on 8 December 1987.

This case assumes added significance because, at bottom line, it involves a conflict between two (2) great departments of
government, the Executive and Legislative Departments. It also occurs early in the life of the 1987 Constitution.

The task of the Court is rendered lighter by the existence of relatively clear provisions in the Constitution. In cases like
this, we follow what the Court, speaking through Mr. Justice (later, Chief Justice) Jose Abad Santos stated in Gold Creek
Mining Corp. vs. Rodriguez, 1 that:

The fundamental principle of constitutional construction is to give effect to the intent of the framers of the organic law and
of the people adopting it. The intention to which force is to be given is that which is embodied and expressed in the
constitutional provisions themselves.

The Court will thus construe the applicable constitutional provisions, not in accordance with how the executive or the
legislative department may want them construed, but in accordance with what they say and provide.

Section 16, Article VII of the 1987 Constitution says:

The President shall nominate and, with the consent of the Commission on Appointments, appoint the heads of the
executive departments, ambassadors, other public ministers and consuls, or officers of the armed forces from the rank of
colonel or naval captain, and other officers whose appointments are vested in him in this Constitution. He shall also
appoint all other officers of the Government whose appointments are not otherwise provided for by law, and those whom
he may be authorized by law to appoint. The Congress may, by law, vest the appointment of other officers lower in rank in
the President alone, in the courts, or in the heads of the departments, agencies, commissions or boards.

The President shall have the power to make appointments during the recess of the Congress, whether voluntary or
compulsory, but such appointments shall be effective only until disapproval by the Commission on Appointments or until
the next adjournment of the Congress.

It is readily apparent that under the provisions of the 1987 Constitution, just quoted, there are four (4) groups of officers
whom the President shall appoint. These four (4) groups, to which we will hereafter refer from time to time, are:

First, the heads of the executive departments, ambassadors, other public ministers and consuls, officers of the armed
forces from the rank of colonel or naval captain, and other officers whose appointments are vested in him in this
Constitution; 2

Second, all other officers of the Government whose appointments are not otherwise provided for by law; 3

Third, those whom the President may be authorized by law to appoint;

Fourth, officers lower in rank 4 whose appointments the Congress may by law vest in the President alone.

The first group of officers is clearly appointed with the consent of the Commission on Appointments. Appointments of such
officers are initiated by nomination and, if the nomination is confirmed by the Commission on Appointments, the President
appoints. 5

The second, third and fourth groups of officers are the present bone of contention. Should they be appointed by the
President with or without the consent (confirmation) of the Commission on Appointments? By following the accepted rule
in constitutional and statutory construction that an express enumeration of subjects excludes others not enumerated, it
would follow that only those appointments to positions expressly stated in the first group require the consent
(confirmation) of the Commission on Appointments. But we need not rely solely on this basic rule of constitutional
construction. We can refer to historical background as well as to the records of the 1986 Constitutional Commission to
determine, with more accuracy, if not precision, the intention of the framers of the 1987 Constitution and the people
adopting it, on whether the appointments by the President, under the second, third and fourth groups, require the consent
(confirmation) of the Commission on Appointments. Again, in this task, the following advice of Mr. Chief Justice J. Abad
Santos in Gold Creek is apropos:

In deciding this point, it should be borne in mind that a constitutional provision must be presumed to have been framed
and adopted in the light and understanding of prior and existing laws and with reference to them. "Courts are bound to
presume that the people adopting a constitution are familiar with the previous and existing laws upon the subjects to
which its provisions relate, and upon which they express their judgment and opinion in its adoption." (Barry vs. Truax 13
N.D., 131; 99 N.W., 769,65 L. R. A., 762.) 6

It will be recalled that, under Sec. 10, Article VII of the 1935 Constitution, it is provided that —

xxx xxx xxx

(3) The President shall nominate and with the consent of the Commission on Appointments, shall appoint the heads of the
executive departments and bureaus, officers of the army from the rank of colonel, of the Navy and Air Forces from the
rank of captain or commander, and all other officers of the Government whose appointments are not herein otherwise
provided for, and those whom he may be authorized by law to appoint; but the Congress may by law vest the appointment
of inferior officers, in the President alone, in the courts, or in the heads of departments.

(4) The President shall havethe power to make appointments during the recess of the Congress, but such appointments
shall be effective only until disapproval by the Commission on Appointments or until the next adjournment of the
Congress.

xxx xxx xxx

(7) ..., and with the consent of the Commission on Appointments, shall appoint ambassadors, other public ministers and
consuls ...

Upon the other hand, the 1973 Constitution provides that-

Section 10. The President shall appoint the heads of bureaus and offices, the officers of the Armed Forces of the
Philippines from the rank of Brigadier General or Commodore, and all other officers of The government whose
appointments are not herein otherwise provided for, and those whom he may be authorized by law to appoint. However,
the Batasang Pambansa may by law vest in the Prime Minister, members of the Cabinet, the Executive Committee,
Courts, Heads of Agencies, Commissions, and Boards the power to appoint inferior officers in their respective offices.

Thus, in the 1935 Constitution, almost all presidential appointments required the consent (confirmation) of the
Commission on Appointments. It is now a sad part of our political history that the power of confirmation by the
Commission on Appointments, under the 1935 Constitution, transformed that commission, many times, into a venue of
"horse-trading" and similar malpractices.

On the other hand, the 1973 Constitution, consistent with the authoritarian pattern in which it was molded and remolded
by successive amendments, placed the absolute power of appointment in the President with hardly any check on the part
of the legislature.

Given the above two (2) extremes, one, in the 1935 Constitution and the other, in the 1973 Constitution, it is not difficult
for the Court to state that the framers of the 1987 Constitution and the people adopting it, struck a "middle ground" by
requiring the consent (confirmation) of the Commission on Appointments for the first group of appointments and leaving to
the President, without such confirmation, the appointment of other officers, i.e., those in the second and third groups as
well as those in the fourth group, i.e., officers of lower rank.

The proceedings in the 1986 Constitutional Commission support this conclusion. The original text of Section 16, Article
VII, as proposed by the Committee on the Executive of the 1986 Constitutional Commission, read as follows:

Section 16. The president shall nominate and, with the consent of a Commission on Appointment, shall appoint the heads
of the executive departments and bureaus, ambassadors, other public ministers and consuls, or officers of the armed
forces from the rank of colonel or naval captain and all other officers of the Government whose appointments are not
otherwise provided for by law, and those whom he may be authorized by law to appoint. The Congress may by law vest
the appointment of inferior officers in the President alone, in the courts, or in the heads of departments 7 [Emphasis
supplied].

The above text is almost a verbatim copy of its counterpart provision in the 1935 Constitution. When the frames discussed
on the floor of the Commission the proposed text of Section 16, Article VII, a feeling was manifestly expressed to make
the power of the Commission on Appointments over presidential appointments more limited than that held by the
Commission in the 1935 Constitution. Thus-

Mr. Rama: ... May I ask that Commissioner Monsod be recognized

The President: We will call Commissioner Davide later.

Mr. Monsod: With the Chair's indulgence, I just want to take a few minutes of our time to lay the basis for some of the
amendments that I would like to propose to the Committee this morning.

xxx xxx xxx

On Section 16, I would like to suggest that the power of the Commission on Appointments be limited to the department
heads, ambassadors, generals and so on but not to the levels of bureau heads and colonels.

xxx xxx xxx 8 (Emphasis supplied.)

In the course of the debates on the text of Section 16, there were two (2) major changes proposed and approved by the
Commission. These were (1) the exclusion of the appointments of heads of bureaus from the requirement of confirmation
by the Commission on Appointments; and (2) the exclusion of appointments made under the second sentence 9 of the
section from the same requirement. The records of the deliberations of the Constitutional Commission show the following:

MR. ROMULO: I ask that Commissioner Foz be recognized

THE PRESIDENT: Commissioner Foz is recognized

MR. FOZ: Madam President, my proposed amendment is on page 7, Section 16, line 26 which is to delete the words "and
bureaus," and on line 28 of the same page, to change the phrase 'colonel or naval captain to MAJOR GENERAL OR
REAR ADMIRAL. This last amendment which is co-authored by Commissioner de Castro is to put a period (.) after the
word ADMIRAL, and on line 29 of the same page, start a new sentence with: HE SHALL ALSO APPOINT, et cetera.

MR. REGALADO: May we have the amendments one by one. The first proposed amendment is to delete the words "and
bureaus" on line 26.

MR. FOZ: That is correct.

MR. REGALADO: For the benefit of the other Commissioners, what would be the justification of the proponent for such a
deletion?

MR. FOZ: The position of bureau director is actually quite low in the executive department, and to require further
confirmation of presidential appointment of heads of bureaus would subject them to political influence.

MR. REGALADO: The Commissioner's proposed amendment by deletion also includes regional directors as distinguished
from merely staff directors, because the regional directors have quite a plenitude of powers within the regions as
distinguished from staff directors who only stay in the office.

MR. FOZ: Yes, but the regional directors are under the supervisiopn of the staff bureau directors.

xxx xxx xxx

MR. MAAMBONG: May I direct a question to Commissioner Foz? The Commissioner proposed an amendment to delete
'and bureaus on Section 16. Who will then appoint the bureau directors if it is not the President?

MR. FOZ: It is still the President who will appoint them but their appointment shall no longer be subject to confirmation by
the Commission on Appointments.

MR. MAAMBONG: In other words, it is in line with the same answer of Commissioner de Castro?

MR. FOZ: Yes.

MR. MAAMBONG: Thank you.

THE PRESIDENT: Is this clear now? What is the reaction of the Committee?

xxx xxx xxx

MR. REGALADO: Madam President, the Committee feels that this matter should be submitted to the body for a vote.

MR. DE CASTRO: Thank you.

MR. REGALADO: We will take the amendments one by one. We will first vote on the deletion of the phrase 'and bureaus
on line 26, such that appointments of bureau directors no longer need confirmation by the Commission on Appointment.

Section 16, therefore, would read: 'The President shall nominate, and with the consent of a Commission on Appointments,
shall appoint the heads of the executive departments, ambassadors. . . .

THE PRESIDENT: Is there any objection to delete the phrase 'and bureaus' on page 7, line 26? (Silence) The Chair hears
none; the amendments is approved.

xxx xxx xxx

MR. ROMULO: Madam President.

THE PRESIDENT: The Acting Floor Leader is recognized.

THE PRESIDENT: Commissioner Foz is recognized

MR. FOZ: Madam President, this is the third proposed amendment on page 7, line 28. 1 propose to put a period (.) after
'captain' and on line 29, delete 'and all' and substitute it with HE SHALL ALSO APPOINT ANY.
MR. REGALADO: Madam President, the Committee accepts the proposed amendment because it makes it clear that
those other officers mentioned therein do not have to be confirmed by the Commission on Appointments.

MR. DAVIDE: Madam President.

THE PRESIDENT: Commissioner Davide is recognized.

xxx xxx xxx

MR. DAVIDE: So would the proponent accept an amendment to his amendment, so that after "captain" we insert the
following words: AND OTHER OFFICERS WHOSE APPOINTMENTS ARE VESTED IN HIM IN THIS CONSTITUTION?

FR. BERNAS: It is a little vague.

MR. DAVIDE: In other words, there are positions provided for in the Constitution whose appointments are vested in the
President, as a matter of fact like those of the different constitutional commissions.

FR. BERNAS: That is correct. This list of officials found in Section 16 is not an exclusive list of those appointments which
constitutionally require confirmation of the Commission on Appointments,

MR. DAVIDE: That is the reason I seek the incorporation of the words I proposed.

FR. BERNAS: Will Commissioner Davide restate his proposed amendment?

MR. DAVIDE: After 'captain,' add the following: AND OTHER OFFICERS WHOSE APPOINTMENTS ARE VESTED IN
HIM IN THIS CONSTITUTION.

FR. BERNAS: How about:"AND OTHER OFFICERS WHOSE APPOINTMENTS REQUIRE CONFIRMATION UNDER
THIS CONSTITUTION"?

MR. DAVIDE: Yes, Madam President, that is modified by the Committee.

FR. BERNAS: That will clarify things.

THE PRESIDENT: Does the Committee accept?

MR. REGALADO: Just for the record, of course, that excludes those officers which the Constitution does not require
confirmation by the Commission on Appointments, like the members of the judiciary and the Ombudsman.

MR. DAVIDE: That is correct. That is very clear from the modification made by Commissioner Bernas.

THE PRESIDENT: So we have now this proposed amendment of Commissioners Foz and Davide.

xxx xxx xxx

THE PRESIDENT: Is there any objection to this proposed amendment of Commissioners Foz and Davide as accepted by
the Committee? (Silence) The Chair hears none; the amendment, as amended, is approved 10 (Emphasis supplied).

It is, therefore, clear that appointments to the second and third groups of officers can be made by the President without
the consent (confirmation) of the Commission on Appointments.

It is contended by amicus curiae, Senator Neptali Gonzales, that the second sentence of Sec. 16, Article VII reading-

He (the President) shall also appoint all other officers of the Government whose appointments are not otherwise provided
for by law and those whom he may be authorized by law to appoint . . . . (Emphasis supplied)

with particular reference to the word "also," implies that the President shall "in like manner" appoint the officers mentioned
in said second sentence. In other words, the President shall appoint the officers mentioned in said second sentence in the
same manner as he appoints officers mentioned in the first sentence, that is, by nomination and with the consent
(confirmation) of the Commission on Appointments.

Amicus curiae's reliance on the word "also" in said second sentence is not necessarily supportive of the conclusion he
arrives at. For, as the Solicitor General argues, the word "also" could mean "in addition; as well; besides, too" (Webster's
International Dictionary, p. 62, 1981 edition) which meanings could, on the contrary, stress that the word "also" in said
second sentence means that the President, in addition to nominating and, with the consent of the Commission on
Appointments, appointing the officers enumerated in the first sentence, can appoint (without such consent (confirmation)
the officers mentioned in the second sentence-

Rather than limit the area of consideration to the possible meanings of the word "also" as used in the context of said
second sentence, the Court has chosen to derive significance from the fact that the first sentence speaks of nomination by
the President and appointment by the President with the consent of the Commission on Appointments, whereas, the
second sentence speaks only of appointment by the President. And, this use of different language in two (2) sentences
proximate to each other underscores a difference in message conveyed and perceptions established, in line with Judge
Learned Hand's observation that "words are not pebbles in alien juxtaposition" but, more so, because the recorded
proceedings of the 1986 Constitutional Commission clearly and expressly justify such differences.
As a result of the innovations introduced in Sec. 16, Article VII of the 1987 Constitution, there are officers whose
appointments require no confirmation of the Commission on Appointments, even if such officers may be higher in rank,
compared to some officers whose appointments have to be confirmed by the Commission on Appointments under the first
sentence of the same Sec. 16, Art. VII. Thus, to illustrate, the appointment of the Central Bank Governor requires no
confirmation by the Commission on Appointments, even if he is higher in rank than a colonel in the Armed Forces of the
Philippines or a consul in the Consular Service.

But these contrasts, while initially impressive, merely underscore the purposive intention and deliberate judgment of the
framers of the 1987 Constitution that, except as to those officers whose appointments require the consent of the
Commission on Appointments by express mandate of the first sentence in Sec. 16, Art. VII, appointments of other officers
are left to the President without need of confirmation by the Commission on Appointments. This conclusion is inevitable, if
we are to presume, as we must, that the framers of the 1987 Constitution were knowledgeable of what they were doing
and of the foreseable effects thereof.

Besides, the power to appoint is fundamentally executive or presidential in character. Limitations on or qualifications of
such power should be strictly construed against them. Such limitations or qualifications must be clearly stated in order to
be recognized. But, it is only in the first sentence of Sec. 16, Art. VII where it is clearly stated that appointments by the
President to the positions therein enumerated require the consent of the Commission on Appointments.

As to the fourth group of officers whom the President can appoint, the intervenor Commission on Appointments
underscores the third sentence in Sec. 16, Article VII of the 1987 Constitution, which reads:

The Congress may, by law, vest the appointment of other officers lower in rank in the President alone, in the courts, or in
the heads of departments, agencies, commissions, or boards. [Emphasis supplied].

and argues that, since a law is needed to vest the appointment of lower-ranked officers in the President alone, this implies
that, in the absence of such a law, lower-ranked officers have to be appointed by the President subject to confirmation by
the Commission on Appointments; and, if this is so, as to lower-ranked officers, it follows that higher-ranked officers
should be appointed by the President, subject also to confirmation by the Commission on Appointments.

The respondents, on the other hand, submit that the third sentence of Sec. 16, Article VII, abovequoted, merely declares
that, as to lower-ranked officers, the Congress may by law vest their appointment in the President, in the courts, or in the
heads of the various departments, agencies, commissions, or boards in the government. No reason however is submitted
for the use of the word "alone" in said third sentence.

The Court is not impressed by both arguments. It is of the considered opinion, after a careful study of the deliberations of
the 1986 Constitutional Commission, that the use of the word alone" after the word "President" in said third sentence of
Sec. 16, Article VII is, more than anything else, a slip or lapsus in draftmanship. It will be recalled that, in the 1935
Constitution, the following provision appears at the end of par. 3, section 1 0, Article VII thereof —

...; but the Congress may by law vest the appointment of inferior officers, in the President alone, in the courts, or in the
heads of departments. [Emphasis supplied].

The above provision in the 1935 Constitution appears immediately after the provision which makes practically all
presidential appointments subject to confirmation by the Commission on Appointments, thus-

3. The President shall nominate and with the consent of the Commission on Appointments, shall appoint the heads of the
executive departments and bureaus, officers of the Army from the rank of colonel, of the Navy and Air Forces from the
rank of captain or commander, and all other officers of the Government whose appointments are not herein provided for,
and those whom he may be authorized by law to appoint; ...

In other words, since the 1935 Constitution subjects, as a general rule, presidential appointments to confirmation by the
Commission on Appointments, the same 1935 Constitution saw fit, by way of an exception to such rule, to provide that
Congress may, however, by law vest the appointment of inferior officers (equivalent to 11 officers lower in rank" referred
to in the 1987 Constitution) in the President alone, in the courts, or in the heads of departments,

In the 1987 Constitution, however, as already pointed out, the clear and expressed intent of its framers was to exclude
presidential appointments from confirmation by the Commission on Appointments, except appointments to offices
expressly mentioned in the first sentence of Sec. 16, Article VII. Consequently, there was no reason to use in the third
sentence of Sec. 16, Article VII the word "alone" after the word "President" in providing that Congress may by law vest the
appointment of lower-ranked officers in the President alone, or in the courts, or in the heads of departments, because the
power to appoint officers whom he (the President) may be authorized by law to appoint is already vested in the President,
without need of confirmation by the Commission on Appointments, in the second sentence of the same Sec. 16, Article
VII.

Therefore, the third sentence of Sec. 16, Article VII could have stated merely that, in the case of lower-ranked officers, the
Congress may by law vest their appointment in the President, in the courts, or in the heads of various departments of the
government. In short, the word "alone" in the third sentence of Sec. 16, Article VII of the 1987 Constitution, as a literal
import from the last part of par. 3, section 10, Article VII of the 1935 Constitution, appears to be redundant in the light of
the second sentence of Sec. 16, Article VII. And, this redundancy cannot prevail over the clear and positive intent of the
framers of the 1987 Constitution that presidential appointments, except those mentioned in the first sentence of Sec. 16,
Article VII, are not subject to confirmation by the Commission on Appointments.

Coming now to the immediate question before the Court, it is evident that the position of Commissioner of the Bureau of
Customs (a bureau head) is not one of those within the first group of appointments where the consent of the Commission
on Appointments is required. As a matter of fact, as already pointed out, while the 1935 Constitution includes "heads of
bureaus" among those officers whose appointments need the consent of the Commission on Appointments, the 1987
Constitution on the other hand, deliberately excluded the position of "heads of bureaus" from appointments that need the
consent (confirmation) of the Commission on Appointments.

Moreover, the President is expressly authorized by law to appoint the Commissioner of the Bureau of Customs. The
original text of Sec. 601 of Republic Act No. 1937, otherwise known as the Tariff and Customs Code of the Philippines,
which was enacted by the Congress of the Philippines on 22 June 1957, reads as follows:

601. Chief Officials of the Bureau.-The Bureau of Customs shall have one chief and one assistant chief, to be known
respectively as the Commissioner (hereinafter known as the 'Commissioner') and Assistant Commissioner of Customs,
who shall each receive an annual compensation in accordance with the rates prescribed by existing laws. The Assistant
Commissioner of Customs shall be appointed by the proper department head.

Sec. 601 of Republic Act No. 1937, was amended on 27 October 1972 by Presidential Decree No. 34, amending the Tariff
and Customs Code of the Philippines. Sec. 601, as thus amended, now reads as follows:

Sec. 601. Chief Officials of the Bureau of Customs.-The Bureau of Customs shall have one chief and one assistant chief,
to be known respectively as the Commissioner (hereinafter known as Commissioner) and Deputy Commissioner of
Customs, who shall each receive an annual compensation in accordance with the rates prescribed by existing law. The
Commissioner and the Deputy Commissioner of Customs shall be appointed by the President of the Philippines
(Emphasis supplied.)

Of course, these laws (Rep. Act No. 1937 and PD No. 34) were approved during the effectivity of the 1935 Constitution,
under which the President may nominate and, with the consent of the Commission on Appointments, appoint the heads of
bureaus, like the Commissioner of the Bureau of Customs.

After the effectivity of the 1987 Constitution, however, Rep. Act No. 1937 and PD No. 34 have to be read in harmony with
Sec. 16, Art. VII, with the result that, while the appointment of the Commissioner of the Bureau of Customs is one that
devolves on the President, as an appointment he is authorizedby law to make, such appointment, however, no longer
needs the confirmation of the Commission on Appointments.

Consequently, we rule that the President of the Philippines acted within her constitutional authority and power in
appointing respondent Salvador Mison, Commissioner of the Bureau of Customs, without submitting his nomination to the
Commission on Appointments for confirmation. He is thus entitled to exercise the full authority and functions of the office
and to receive all the salaries and emoluments pertaining thereto.

WHEREFORE, the petition and petition in intervention should be, as they are, hereby DISMISSED. Without costs.

SO ORDERED.

Yap, Fernan, Narvasa, Paras, Feliciano, Gancayco, Bidin and Cortes, JJ., concur.

Separate Opinions

TEEHANKEE, C.J., concurring:

The Court has deemed it necessary and proper, in consonance with its constitutional duty, to adjudicate promptly the
issue at bar and to rule that the direct appointment of respondent Salvador Mison as Commissioner of the Bureau of
Customs (without need of submitting a prior nomination to the Commission on Appointments and securing its
confirmation) is valid and in accordance with the President's constitutional authority to so appoint officers of the
Government as defined in Article VII, section 16 of the 1987 Constitution. The paramount public interest and the
exigencies of the public service demand that any doubts over the validity of such appointments be resolved expeditiously
in the test case at bar.

It should be noted that the Court's decision at bar does not mention nor deal with the Manifestation of December 1, 1987
filed by the intervenor that Senate Bill No. 137 entitled "An Act Providing For the Confirmation By the Commission on
Appointments of All Nominations and Appointments Made by the President of the Philippines" was passed on 23 October
1987 and was "set for perusal by the House of Representatives. " This omission has been deliberate. The Court has
resolved the case at bar on the basis of the issues joined by the parties. The contingency of approval of the bill mentioned
by intervenor clearly has no bearing on and cannot affect retroactively the validity of the direct appointment of respondent
Mison and other appointees similarly situated as in G.R. No. 80071, "Alex G. Almario vs. Hon. Miriam Defensor-
Santiago." The Court does not deal with constitutional questions in the abstract and without the same being properly
raised before it in a justiciable case and after thorough discussion of the various points of view that would enable it to
render judgment after mature deliberation. As stressed at the hearing of December 8, 1987, any discussion of the
reported bill and its validity or invalidity is premature and irrelevant and outside the scope of the issues resolved in the
case at bar.

MELENCIO-HERRERA, J., concurring:

I concur with the majority opinion and with the concurring opinion of Justice Sarmiento, and simply wish to add my own
reading of the Constitutional provision involved.
Section 16, Article VII, of the 1987 Constitution provides:

The President shall nominate and, with the consent of the Commission on Appointments, appoint the heads of the
executive departments, ambassadors, other public ministers and consuls, or officers of the armed forces from the rank of
colonel or naval captain, and other officers whose appointments are vested in him in this Constitution.

He shall also appoint all other officers of the Government whose appointments are not otherwise provided for by law, and
those whom he may be authorized by law to appoint.

The Congress may, by law, vest the appointment of other officers lower in rank in the President alone, in the courts, or in
the heads of the departments, agencies, commissions or boards.

The President shall have the power to make appointments during the recess of the Congress, whether voluntary or
compulsory, but such appointments shall be effective only until disapproval by the Commission on Appointments or until
the next adjournment of the Congress (Emphasis and 1st three paragraphings, supplied).

The difference in language used is significant. Under the first sentence it is clear that the President "nominates" and with
the consent of the Commission on Appointments "appoints" the officials enumerated. The second sentence, however,
significantly uses only the term "appoint" all other officers of the Government whose appointments are not otherwise
provided for by law, and those whom he may be authorized by law to appoint. Deliberately eliminated was any reference
to nomination.

Thus, the intent of the framers of the Constitution to exclude the appointees mentioned in the second sentence from
confirmation by the Commission on Appointments is, to my mind, quite clear. So also is the fact that the term "appoint"
used in said sentence was not meant to include the three distinct acts in the appointing process, namely, nomination,
appointment, and commission. For if that were the intent, the same terminologies in the first sentence could have been
easily employed.

There should be no question either that the participation of the Commission on Appointments in the appointment process
has been deliberately decreased in the 1987 Constitution compared to that in the 1935 Constitution, which required that
all presidential appointments be with the consent of the Commission on Appointments.

The interpretation given by the majority may, indeed, lead to some incongruous situations as stressed in the dissenting
opinion of Justice Cruz. The remedy therefor addresses itself to the future. The task of constitutional construction is to
ascertain the intent of the framers of the Constitution and thereafter to assure its realization (J.M. Tuason & Co., Inc. vs.
Land Tenure Administration, G.R. No. 21064, February 18, 1970, 31 SCRA 413). And the primary source from which to
ascertain constitutional intent is the language of the Constitution itself.

SARMIENTO, J., concurring:

I concur. It is clear from the Constitution itself that not all Presidential appointments are subject to prior Congressional
confirmation, thus:

Sec. 16. The President shall nominate and, with the consent of the Commission on Appointments, appoint the heads of
the executive departments, ambassadors, other public ministers and consuls, or officers of the armed forces from the rank
of colonel or naval captain, and other officers whose appointments are vested in him in this Constitution. He shall also
appoint all other officers of the Government whose appointments are not otherwise provided for by law, and those whom
he may be authorized by law to appoint. The Congress may, by law, vest the appointment of other officers lower in rank in
the President alone, in the courts, or in the heads of departments, agencies, commissions, or boards.

The President shall have the power to make appointments during recess of the Congress, whether voluntary or
compulsory, but such appointment shall be effective only until disapproval by the Commission on Appointments or until
the next adjournment of the Congress. 1

By its plain language, the Constitution has intended that only those grouped under the first sentence are required to
undergo a consenting process. This is a significant departure from the procedure set forth in the 1935 Charter:

(3) The President shall nominate and with the consent of the Commission on Appointments, shall appoint the heads of the
executive departments and bureaus, officers of the Army from the rank of colonel, of the Navy and Air Forces from the
rank of captain to commander, and all other officers of the Government whose appointments are not herein otherwise
provided for, and those whom he may be authorized by law to appoint; but the Congress may by law vest the appointment
of inferior officers, in the President alone, in the courts, or in the heads of departments. 2

under which, as noted by the majority, "almost all presidential appointments required the consent (confirmation) of the
Commission on Appointments. 3 As far as the present Charter is concerned, no extrinsic aid is necessary to ascertain its
meaning. Had its framers intended otherwise, that is to say, to require all Presidential appointments clearance from the
Commission on Appointments, they could have simply reenacted the Constitution's 1935 counterpart. 4

I agree that the present Constitution classifies four types of appointments that the President may make: (1) appointments
of heads of executive departments, ambassadors, other public ministers and consuls, or officers of the armed forces from
the rank of colonel or naval captain, and those of other officers whose appointments are vested in him under the
Constitution, including the regular members of the Judicial and Bar Council, 5 the Chairman and Commissioners of the
Civil Service Commission, 6 the Chairman and Commissioners of the Commission on Elections, 7 and the Chairman and
Commissioners of the Commission on Audit; 8 (2) those officers whose appointments are not otherwise provided for by
law; (3) those whom he may be authorized by law to appoint; and (4) officers lower in rank whose appointments the
Congress may vest in the President alone.
But like Justice Cruz in his dissent, I too am aware that authors of the fundamental law have written a "rather confused
Constitution" 9 with respect, to a large extent, to its other parts, and with respect, to a certain extent, to the appointing
clause itself, in the sense that it leaves us for instance, with the incongruous situation where a consul's appointment
needs confirmation whereas that of Undersecretary of Foreign

Affairs, his superior, does not. But the Idiosyncracies, as it were, of the Charter is not for us to judge. That is a question
addressed to the electorate, and who, despite those "eccentricities," have stamped their approval on that Charter. "The
Court," avers the majority, "will thus construe the applicable constitutional provisions, not in accordance with how the
executive or the legislative department may want them construed, but in accordance with what they say and provide." 10

It must be noted that the appointment of public officials is essentially an exercise of executive power. 11 The fact that the
Constitution has provided for a Commission on Appointments does not minimize the extent of such a power, much less,
make it a shared executive-legislative prerogative. In Concepcion v. Paredes, we stated in no uncertain terms that
"[a]ppointment to office is intrinsically an executive act involving the exercise of discretion." 12 Springer v. Philippine
Islands 13 on the other hand, underscored the fact that while the legislature may create a public office, it cannot name the
official to discharge the functions appurtenant thereto. And while it may prescribe the qualifications therefor, it cannot
circumscribe such qualifications, which would unduly narrow the President's choice. In that event, it is as if it is the
legislature itself conferring the appointment.

Thus, notwithstanding the existence of a Commission on Appointments, the Chief Executive retains his supremacy as the
appointing authority. In case of doubt, the same should be resolved in favor of the appointing power.

It is the essence of a republican form of government, like ours, that "[e]ach department of the government has exclusive
cognizance of matters within its jurisdiction." 14 But like all genuine republican systems, no power is absolutely separate
from the other. For republicanism operates on a process of checks and balances as well, not only to guard against
excesses by one branch, but more importantly, "to secure coordination in the workings of the various departments of the
government." 15 Viewed in that light, the Commission on Appointments acts as a restraint against abuse of the appointing
authority, but not as a means with which to hold the Chief Executive hostage by a possibly hostile Congress, an unhappy
lesson as the majority notes, in our history under the regime of the 1935 Constitution.

The system of checks and balances is not peculiar to the provision on appointments. The prohibition, for instance, against
the enactment of a bill of attainder operates as a bar against legislative encroachment upon both judicial and executive
domains, since the determination of guilt and punishment of the guilty address judicial and executive functions, respective
y. 16

And then, the cycle of checks and balances pervading the Constitution is a sword that cuts both ways. In a very real
sense, the power of appointment constitutes a check against legislative authority. In Springer v. Philippine Islands, 17 we
are told that "Congress may not control the law enforcement process by retaining a power to appoint the individual who
will execute the laws." 18 This is so, according to one authority, because "the appointments clause, rather than 'merely
dealing with etiquette or protocol,' seeks to preserve an executive check upon legislative authority in the interest of
avoiding an undue concentration of power in Congress. " 19

The President has sworn to "execute [the] laws. 20 For that matter, no other department of the Government may
discharge that function, least of all Congress. Accordingly, a statute conferring upon a commission the responsibility of
administering that very legislation and whose members have been determined therein, has been held to be repugnant to
the Charter. 21 Execution of the laws, it was held, is the concern of the President, and in going about this business, he
acts by himself or through his men and women, and no other.

The President, on the other hand, cannot remove his own appointees "except for cause provided by law." 22
Parenthetically, this represents a deviation from the rule prevailing in American jurisdiction that "the power of removal . . .
[is] incident to the power of appointment, 23 although this has since been tempered in a subsequent case, 24 where it
was held that the President may remove only "purely executive officers, 25 that is, officers holding office at his pleasure.
In Ingles v. Mutuc, 26 this Court held that the President may remove incumbents of offices confidential in nature, but we
likewise made clear that in such a case, the incumbent is not "removed" within the meaning of civil service laws, but that
his term merely expires.

It is to be observed, indeed, that the Commission on Appointments, as constituted under the 1987 Constitution, is itself
subject to some check. Under the Charter, "[tlhe Commission shall act on all appointments submitted to it within thirty
session days of the Congress from their submission. 27 Accordingly, the failure of the Commission to either consent or
not consent to the appointments preferred before it within the prescribed period results in a de facto confirmation thereof

Certainly, our founding fathers have fashioned a Constitution where the boundaries of power are blurred by the
predominance of checks and counterchecks, yet amid such a rubble of competing powers emerges a structure whose
parts are at times jealous of each other, but which are ultimately necessary in assuring a dynamic, but stable, society. As
Mr. Justice Holmes had so elegantly articulated:

xxx xxx xxx

The great ordinances of the Constitution do not establish and divide fields of black and white. Even the more specific of
them are found to terminate in a penumbra shading gradually from one extreme to the other. ... When we come to the
fundamental distinctions it is still more obvious that they must be received with a certain latitude or our government could
not go on.

xxx xxx xxx

It does not seem to need argument to show that however we may disguise it by veiling words we do not and cannot carry
out the distinction between legislative and executive action with mathematical precision and divide the branches into
watertight compartments, were it ever so desirable to do so, which I am far from believing that it is, or that the Constitution
requires. 28

xxx xxx xxx

We are furthermore told:

xxx xxx xxx

... (I)t will be vital not to forget that all of these "checks and counterpoises, which Newton might readily have recognized as
suggestive of the mechanism of the heavens," (W. Wilson, Constitutional Government in the United States 56 (1908)] can
represent only the scaffolding of a far more subtle "vehicle of life (Id. at 192: "The Constitution cannot be regarded as a
mere legal document, to be read as a will or a contract would be. It must, of the necessity of the case, be a vehicle of
life.") The great difficulty of any theory less rich, Woodrow Wilson once warned, "is that government is not a machine, but
a living thing. It falls, not under the theory of the universe, but under the theory of organic life. It is accountable to Darwin,
not to Newton. It is . . . shaped to its functions by the sheer pressure of life. No living thing can have its organs offset
against each other as checks, and five." (Id. at 56.) Yet because no complex society can have its centers of power not
"offset against each other as checks," and resist tyranny, the Model of Separated and Divided Powers offers continuing
testimony to the undying dilemmas of progress and justice. 29

xxx xxx xxx

As a closing observation, I wish to clear the impression that the 1973 Constitution deliberately denied the legislature (the
National Assembly under the 1971 draft Constitution) the power to check executive appointments, and hence, granted the
President absolute appointing power. 30 As a delegate to, and Vice-President of, the ill-fated 1971 Constitutional
Convention, and more so as the presiding officer of most of its plenary session, I am aware that the Convention did not
provide for a commission on appointments on the theory that the Prime Minister, the head of the Government and the sole
appointing power, was himself a member of parliament. For this reason, there was no necessity for a separate body to
scrutinize his appointees. But should such appointees forfeit the confidence of the assembly, they are, by tradition,
required to resign, unless they should otherwise have been removed by the Prime Minister. 31 In effect, it is parliament
itself that "approves" such appointments. Unfortunately, supervening events forestalled our parliamentary experiment, and
beginning with the 1976 amendments and some 140 or so amendments thereafter, we had reverted to the presidential
form, 32 without provisions for a commission on appointments.

In fine, while Presidential appointments, under the first sentence of Section 16, of Article VII of the present Constitution,
must pass prior Congressional scrutiny, it is a test that operates as a mere safeguard against abuse with respect to those
appointments. It does not accord Congress any more than the power to check, but not to deny, the Chief Executive's
appointing power or to supplant his appointees with its own. It is but an exception to the rule. In limiting the Commission's
scope of authority, compared to that under the 1935 Constitution, I believe that the 1987 Constitution has simply
recognized the reality of that exception.

GUTIERREZ, JR., J., dissenting:

I join Justice Isagani A. Cruz in his dissent. I agree that the Constitution, as the supreme law of the land, should never
have any of its provisions interpreted in a manner that results in absurd or irrational consequences.

The Commission on Appointments is an important constitutional body which helps give fuller expression to the principles
inherent in our presidential system of government. Its functions cannot be made innocuous or unreasonably diminished to
the confirmation of a limited number of appointees. In the same manner that the President shares in the enactment of
laws which govern the nation, the legislature, through its Commission on Appointments, gives assurance that only those
who can pass the scrutiny of both the President and Congress will help run the country as officers holding high appointive
positions. The third sentence of the first paragraph — " ... The Congress may, by law, vest the appointment of other
officers lower in rank in the President alone, in the courts, or in the heads of departments, agencies, commissions, or
boards." — specifies only "officers lower in rank" as those who may, by law, be appointed by the President alone. If as
expounded in the majority opinion, only the limited number of officers in the first sentence of Section 16 require
confirmation, the clear intent of the third sentence is lost. In fact both the second and third sentences become
meaningless or superfluous. Superfluity is not to be read into such an important part of the Constitution.

I agree with the intervenor that all provisions of the Constitution on appointments must be read together. In providing for
the appointment of members of the Supreme Court and judges of lower courts (Section 9, Article VIII), the Ombudsman
and his deputies (Section 9, Article XI), the Vice President as a member of cabinet (Section 3, Article VII) and, of course,
those who by law the President alone may appoint, the Constitution clearly provides no need for confirmation. This can
only mean that all other appointments need confirmation. Where there is no need for confirmation or where there is an
alternative process to confirmation, the Constitution expressly so declares. Without such a declaration, there must be
confirmation.

The 1973 Constitution dispensed with confirmation by a Commission on Appointments because the government it set up
was supposed to be a parliamentary one. The Prime Minister, as head of government, was constantly accountable to the
legislature. In our presidential system, the interpretation which Justice Cruz and myself espouse, is more democratic and
more in keeping with the system of government organized under the Constitution.

I, therefore vote to grant the petition.

CRUZ, J., dissenting:

The view of the respondent, as adopted by the majority opinion, is briefly as follows: Confirmation is required only for the
officers mentioned in the first sentence of Section 16, to wit: (1) the heads of the executive departments; (2)
ambassadors, other public ministers and consuls; (3) officers of the armed forces from the rank of colonel or naval
captain; and (4) other officers whose appointments are vested in the President in the Constitution. No confirmation is
required under the second sentence for (1) all other officers whose appointments are not otherwise provided for by law,
and (2) those whom the President may be authorized by law to appoint. Neither is confirmation required by the third
sentence for those other officers lower in rank whose appointment is vested by law in the President alone.

Following this interpretation, the Undersecretary of Foreign Affairs, who is not the head of his department, does not have
to be confirmed by the Commission on Appointments, but the ordinary consul, who is under his jurisdiction, must be
confirmed. The colonel is by any standard lower in rank than the Chairman of the Commission on Human Rights, which
was created by the Constitution; yet the former is subject to confirmation but the latter is not because he does not come
under the first sentence. The Special Prosecutor, whose appointment is not vested by the Constitution in the President, is
not subject to confirmation under the first sentence, and neither are the Governor of the Central Bank and the members of
the Monetary Board because they fall under the second sentence as interpreted by the majority opinion. Yet in the case of
the multi-sectoral members of the regional consultative commission, whose appointment is vested by the Constitution in
the President under Article X, Section 18, their confirmation is required although their rank is decidedly lower.

I do not think these discrepancies were intended by the framers as they would lead to the absurd consequences we
should avoid in interpreting the Constitution.

There is no question that bureau directors are not required to be confirmed under the first sentence of Section 16, but that
is not the provision we ought to interpret. It is the second sentence we must understand for a proper resolution of the
issues now before us. Significantly, although there was a long discussion of the first sentence in the Constitutional
Commission, there is none cited on the second sentence either in the Solicitor-General's comment or in the majority
opinion. We can therefore only speculate on the correct interpretation of this provision in the light of the first and third
sentences of Section 16 or by reading this section in its totality.

The majority opinion says that the second sentence is the exception to the first sentence and holds that the two sets of
officers specified therein may be appointed by the President without the concurrence of the Commission on
Appointments. This interpretation is pregnant with mischievous if not also ridiculous results that presumably were not
envisioned by the framers.

One may wonder why it was felt necessary to include the second sentence at all, considering the majority opinion that the
enumeration in the first sentence of the officers subject to confirmation is exclusive on the basis of expressio unius est
exclusio alterius. If that be so, the first sentence would have been sufficient by itself to convey the Idea that all other
appointees of the President would not need confirmation.

One may also ask why, if the officers mentioned in the second sentence do not need confirmation, it was still felt
necessary to provide in the third sentence that the appointment of the other officers lower in rank will also not need
confirmation as long as their appointment is vested by law in the President alone. The third sentence would appear to be
superfluous, too, again in view of the first sentence.

More to the point, what will follow if Congress does not see fit to vest in the President alone the appointment of those
other officers lower in rank mentioned in the third sentence? Conformably to the language thereof, these lower officers will
need the confirmation of the Commission on Appointments while, by contrast, the higher officers mentioned in the second
sentence will not.

Thus, a regional director in the Department of Labor and the labor arbiters, as officers lower in rank than the bureau
director, will have to be confirmed if the Congress does not vest their appointment in the President alone under the third
sentence. On the other hand, their superior, the bureau director himself, will not need to be confirmed because, according
to the majority opinion, he falls not under the first sentence but the second. This is carefulness in reverse, like checking
the bridesmaids but forgetting the bride.

It must be borne in mind that one of the purposes of the Constitutional Commission was to restrict the powers of the
Presidency and so prevent the recurrence of another dictatorship. Among the many measures taken was the restoration
of the Commission on Appointments to check the appointing power which had been much abused by President Marcos.
We are now told that even as this body was revived to limit appointments, the scope of its original authority has itself been
limited in the new Constitution. I have to disagree.

My own reading is that the second sentence is but a continuation of the Idea expressed in the first sentence and simply
mentions the other officers appointed by the President who are also subject to confirmation. The second sentence is the
later expression of the will of the framers and so must be interpreted as complementing the rule embodied in the first
sentence or, if necessary, reversing the original intention to exempt bureau directors from confirmation. I repeat that there
were no debates on this matter as far as I know, which simply means that my humble conjecture on the meaning of
Section 16 is as arguable, at least, as the suppositions of the majority. We read and rely on the same records. At any rate,
this view is more consistent with the general purpose of Article VII, which, to repeat, was to reduce the powers of the
Presidency.

The respondent cites the following exchange reported in page 520, Volume II, of the Record of the Constitutional
Convention:

Mr. Foz: Madam President, this is the third proposed amendment on page 7, line 28, 1 propose to put a period (.) after
'captain' and on line 29, delete 'and all' and substitute it with HE SHALL ALSO APPOINT ANY.

Mr. Regalado: Madam President, the Committee accepts the proposed amendment because it makes it clear that those
other officers mentioned therein do not have to be confirmed by the Commission on Appointments.

However, the records do not show what particular part of Section 16 the committee chairman was referring to, and a
reading in its entirety of this particular debate will suggest that the body was considering the first sentence of the said
section, which I reiterate is not the controversial provision. In any case, although the excerpt shows that the proposed
amendment of Commissioner Foz was accepted by the committee, it is not reflected, curiously enough, in the final version
of Section 16 as a perusal thereof will readily reveal. Whether it was deleted later in the session or reworded by the style
committee or otherwise replaced for whatever reason will need another surmise on this rather confused Constitution.

I need only add that the records of the Constitutional Commission are merely extrinsic aids and are at best persuasive
only and not necessarily conclusive. Interestingly, some quarters have observed that the Congress is not prevented from
adding to the list of officers subject to confirmation by the Commission on Appointments and cite the debates on this
matter in support of this supposition. It is true enough that there was such a consensus, but it is equally true that this
thinking is not at all expressed, or even only implied, in the language of Section 16 of Article VII. Which should prevail
then the provision as worded or the debates?

It is not disputed that the power of appointment is executive in nature, but there is no question either that it is not absolute
or unlimited. The rule re- established by the new Constitution is that the power requires confirmation by the Commission
on Appointments as a restraint on presidential excesses, in line with the system of checks and balances. I submit it is the
exception to this rule, and not the rule, that should be strictly construed.

In my view, the only officers appointed by the President who are not subject to confirmation by the Commission on
Appointments are (1) the members of the judiciary and the Ombudsman and his deputies, who are nominated by the
Judicial and Bar Council; (2) the Vice-President when he is appointed to the Cabinet; and (3) "other officers lower in rank,"
but only when their appointment is vested by law in the President alone. It is clear that this enumeration does not include
the respondent Commissioner of Customs who, while not covered by the first sentence of Section 16, comes under the
second sentence thereof as I would interpret it and so is also subject to confirmation.

I vote to grant the petition.

Separate Opinions

TEEHANKEE, C.J., concurring:

The Court has deemed it necessary and proper, in consonance with its constitutional duty, to adjudicate promptly the
issue at bar and to rule that the direct appointment of respondent Salvador Mison as Commissioner of the Bureau of
Customs (without need of submitting a prior nomination to the Commission on Appointments and securing its
confirmation) is valid and in accordance with the President's constitutional authority to so appoint officers of the
Government as defined in Article VII, section 16 of the 1987 Constitution. The paramount public interest and the
exigencies of the public service demand that any doubts over the validity of such appointments be resolved expeditiously
in the test case at bar.

It should be noted that the Court's decision at bar does not mention nor deal with the Manifestation of December 1, 1987
filed by the intervenor that Senate Bill No. 137 entitled "An Act Providing For the Confirmation By the Commission on
Appointments of All Nominations and Appointments Made by the President of the Philippines" was passed on 23 October
1987 and was "set for perusal by the House of Representatives. " This omission has been deliberate. The Court has
resolved the case at bar on the basis of the issues joined by the parties. The contingency of approval of the bill mentioned
by intervenor clearly has no bearing on and cannot affect retroactively the validity of the direct appointment of respondent
Mison and other appointees similarly situated as in G.R. No. 80071, "Alex G. Almario vs. Hon. Miriam Defensor-
Santiago." The Court does not deal with constitutional questions in the abstract and without the same being properly
raised before it in a justiciable case and after thorough discussion of the various points of view that would enable it to
render judgment after mature deliberation. As stressed at the hearing of December 8, 1987, any discussion of the
reported bill and its validity or invalidity is premature and irrelevant and outside the scope of the issues resolved in the
case at bar.

MELENCIO-HERRERA, J., concurring:

I concur with the majority opinion and with the concurring opinion of Justice Sarmiento, and simply wish to add my own
reading of the Constitutional provision involved.

Section 16, Article VII, of the 1987 Constitution provides:

The President shall nominate and, with the consent of the Commission on Appointments, appoint the heads of the
executive departments, ambassadors, other public ministers and consuls, or officers of the armed forces from the rank of
colonel or naval captain, and other officers whose appointments are vested in him in this Constitution.

He shall also appoint all other officers of the Government whose appointments are not otherwise provided for by law, and
those whom he may be authorized by law to appoint.

The Congress may, by law, vest the appointment of other officers lower in rank in the President alone, in the courts, or in
the heads of the departments, agencies, commissions or boards.

The President shall have the power to make appointments during the recess of the Congress, whether voluntary or
compulsory, but such appointments shall be effective only until disapproval by the Commission on Appointments or until
the next adjournment of the Congress (Emphasis and 1st three paragraphings, supplied).

The difference in language used is significant. Under the first sentence it is clear that the President "nominates" and with
the consent of the Commission on Appointments "appoints" the officials enumerated. The second sentence, however,
significantly uses only the term "appoint" all other officers of the Government whose appointments are not otherwise
provided for by law, and those whom he may be authorized by law to appoint. Deliberately eliminated was any reference
to nomination.

Thus, the intent of the framers of the Constitution to exclude the appointees mentioned in the second sentence from
confirmation by the Commission on Appointments is, to my mind, quite clear. So also is the fact that the term "appoint"
used in said sentence was not meant to include the three distinct acts in the appointing process, namely, nomination,
appointment, and commission. For if that were the intent, the same terminologies in the first sentence could have been
easily employed.

There should be no question either that the participation of the Commission on Appointments in the appointment process
has been deliberately decreased in the 1987 Constitution compared to that in the 1935 Constitution, which required that
all presidential appointments be with the consent of the Commission on Appointments.

The interpretation given by the majority may, indeed, lead to some incongruous situations as stressed in the dissenting
opinion of Justice Cruz. The remedy therefor addresses itself to the future. The task of constitutional construction is to
ascertain the intent of the framers of the Constitution and thereafter to assure its realization (J.M. Tuason & Co., Inc. vs.
Land Tenure Administration, G.R. No. 21064, February 18, 1970, 31 SCRA 413). And the primary source from which to
ascertain constitutional intent is the language of the Constitution itself.

SARMIENTO, J., concurring:

I concur. It is clear from the Constitution itself that not all Presidential appointments are subject to prior Congressional
confirmation, thus:

Sec. 16. The President shall nominate and, with the consent of the Commission on Appointments, appoint the heads of
the executive departments, ambassadors, other public ministers and consuls, or officers of the armed forces from the rank
of colonel or naval captain, and other officers whose appointments are vested in him in this Constitution. He shall also
appoint all other officers of the Government whose appointments are not otherwise provided for by law, and those whom
he may be authorized by law to appoint. The Congress may, by law, vest the appointment of other officers lower in rank in
the President alone, in the courts, or in the heads of departments, agencies, commissions, or boards.

The President shall have the power to make appointments during recess of the Congress, whether voluntary or
compulsory, but such appointment shall be effective only until disapproval by the Commission on Appointments or until
the next adjournment of the Congress. 1

By its plain language, the Constitution has intended that only those grouped under the first sentence are required to
undergo a consenting process. This is a significant departure from the procedure set forth in the 1935 Charter:

(3) The President shall nominate and with the consent of the Commission on Appointments, shall appoint the heads of the
executive departments and bureaus, officers of the Army from the rank of colonel, of the Navy and Air Forces from the
rank of captain to commander, and all other officers of the Government whose appointments are not herein otherwise
provided for, and those whom he may be authorized by law to appoint; but the Congress may by law vest the appointment
of inferior officers, in the President alone, in the courts, or in the heads of departments. 2

under which, as noted by the majority, "almost all presidential appointments required the consent (confirmation) of the
Commission on Appointments. 3 As far as the present Charter is concerned, no extrinsic aid is necessary to ascertain its
meaning. Had its framers intended otherwise, that is to say, to require all Presidential appointments clearance from the
Commission on Appointments, they could have simply reenacted the Constitution's 1935 counterpart. 4

I agree that the present Constitution classifies four types of appointments that the President may make: (1) appointments
of heads of executive departments, ambassadors, other public ministers and consuls, or officers of the armed forces from
the rank of colonel or naval captain, and those of other officers whose appointments are vested in him under the
Constitution, including the regular members of the Judicial and Bar Council, 5 the Chairman and Commissioners of the
Civil Service Commission, 6 the Chairman and Commissioners of the Commission on Elections, 7 and the Chairman and
Commissioners of the Commission on Audit; 8 (2) those officers whose appointments are not otherwise provided for by
law; (3) those whom he may be authorized by law to appoint; and (4) officers lower in rank whose appointments the
Congress may vest in the President alone.

But like Justice Cruz in his dissent, I too am aware that authors of the fundamental law have written a "rather confused
Constitution" 9 with respect, to a large extent, to its other parts, and with respect, to a certain extent, to the appointing
clause itself, in the sense that it leaves us for instance, with the incongruous situation where a consul's appointment
needs confirmation whereas that of Undersecretary of Foreign

Affairs, his superior, does not. But the Idiosyncracies, as it were, of the Charter is not for us to judge. That is a question
addressed to the electorate, and who, despite those "eccentricities," have stamped their approval on that Charter. "The
Court," avers the majority, "will thus construe the applicable constitutional provisions, not in accordance with how the
executive or the legislative department may want them construed, but in accordance with what they say and provide." 10

It must be noted that the appointment of public officials is essentially an exercise of executive power. 11 The fact that the
Constitution has provided for a Commission on Appointments does not minimize the extent of such a power, much less,
make it a shared executive-legislative prerogative. In Concepcion v. Paredes, we stated in no uncertain terms that
"[a]ppointment to office is intrinsically an executive act involving the exercise of discretion." 12 Springer v. Philippine
Islands 13 on the other hand, underscored the fact that while the legislature may create a public office, it cannot name the
official to discharge the functions appurtenant thereto. And while it may prescribe the qualifications therefor, it cannot
circumscribe such qualifications, which would unduly narrow the President's choice. In that event, it is as if it is the
legislature itself conferring the appointment.
Thus, notwithstanding the existence of a Commission on Appointments, the Chief Executive retains his supremacy as the
appointing authority. In case of doubt, the same should be resolved in favor of the appointing power.

It is the essence of a republican form of government, like ours, that "[e]ach department of the government has exclusive
cognizance of matters within its jurisdiction." 14 But like all genuine republican systems, no power is absolutely separate
from the other. For republicanism operates on a process of checks and balances as well, not only to guard against
excesses by one branch, but more importantly, "to secure coordination in the workings of the various departments of the
government." 15 Viewed in that light, the Commission on Appointments acts as a restraint against abuse of the appointing
authority, but not as a means with which to hold the Chief Executive hostage by a possibly hostile Congress, an unhappy
lesson as the majority notes, in our history under the regime of the 1935 Constitution.

The system of checks and balances is not peculiar to the provision on appointments. The prohibition, for instance, against
the enactment of a bill of attainder operates as a bar against legislative encroachment upon both judicial and executive
domains, since the determination of guilt and punishment of the guilty address judicial and executive functions, respective
y. 16

And then, the cycle of checks and balances pervading the Constitution is a sword that cuts both ways. In a very real
sense, the power of appointment constitutes a check against legislative authority. In Springer v. Philippine Islands, 17 we
are told that "Congress may not control the law enforcement process by retaining a power to appoint the individual who
will execute the laws." 18 This is so, according to one authority, because "the appointments clause, rather than 'merely
dealing with etiquette or protocol,' seeks to preserve an executive check upon legislative authority in the interest of
avoiding an undue concentration of power in Congress. " 19

The President has sworn to "execute [the] laws. 20 For that matter, no other department of the Government may
discharge that function, least of all Congress. Accordingly, a statute conferring upon a commission the responsibility of
administering that very legislation and whose members have been determined therein, has been held to be repugnant to
the Charter. 21 Execution of the laws, it was held, is the concern of the President, and in going about this business, he
acts by himself or through his men and women, and no other.

The President, on the other hand, cannot remove his own appointees "except for cause provided by law." 22
Parenthetically, this represents a deviation from the rule prevailing in American jurisdiction that "the power of removal . . .
[is] incident to the power of appointment, 23 although this has since been tempered in a subsequent case, 24 where it
was held that the President may remove only "purely executive officers, 25 that is, officers holding office at his pleasure.
In Ingles v. Mutuc, 26 this Court held that the President may remove incumbents of offices confidential in nature, but we
likewise made clear that in such a case, the incumbent is not "removed" within the meaning of civil service laws, but that
his term merely expires.

It is to be observed, indeed, that the Commission on Appointments, as constituted under the 1987 Constitution, is itself
subject to some check. Under the Charter, "[tlhe Commission shall act on all appointments submitted to it within thirty
session days of the Congress from their submission. 27 Accordingly, the failure of the Commission to either consent or
not consent to the appointments preferred before it within the prescribed period results in a de facto confirmation thereof

Certainly, our founding fathers have fashioned a Constitution where the boundaries of power are blurred by the
predominance of checks and counterchecks, yet amid such a rubble of competing powers emerges a structure whose
parts are at times jealous of each other, but which are ultimately necessary in assuring a dynamic, but stable, society. As
Mr. Justice Holmes had so elegantly articulated:

xxx xxx xxx

The great ordinances of the Constitution do not establish and divide fields of black and white. Even the more specific of
them are found to terminate in a penumbra shading gradually from one extreme to the other. ... When we come to the
fundamental distinctions it is still more obvious that they must be received with a certain latitude or our government could
not go on.

xxx xxx xxx

It does not seem to need argument to show that however we may disguise it by veiling words we do not and cannot carry
out the distinction between legislative and executive action with mathematical precision and divide the branches into
watertight compartments, were it ever so desirable to do so, which I am far from believing that it is, or that the Constitution
requires. 28

xxx xxx xxx

We are furthermore told:

xxx xxx xxx

... (I)t will be vital not to forget that all of these "checks and counterpoises, which Newton might readily have recognized as
suggestive of the mechanism of the heavens," (W. Wilson, Constitutional Government in the United States 56 (1908)] can
represent only the scaffolding of a far more subtle "vehicle of life (Id. at 192: "The Constitution cannot be regarded as a
mere legal document, to be read as a will or a contract would be. It must, of the necessity of the case, be a vehicle of
life.") The great difficulty of any theory less rich, Woodrow Wilson once warned, "is that government is not a machine, but
a living thing. It falls, not under the theory of the universe, but under the theory of organic life. It is accountable to Darwin,
not to Newton. It is . . . shaped to its functions by the sheer pressure of life. No living thing can have its organs offset
against each other as checks, and five." (Id. at 56.) Yet because no complex society can have its centers of power not
"offset against each other as checks," and resist tyranny, the Model of Separated and Divided Powers offers continuing
testimony to the undying dilemmas of progress and justice. 29
xxx xxx xxx

As a closing observation, I wish to clear the impression that the 1973 Constitution deliberately denied the legislature (the
National Assembly under the 1971 draft Constitution) the power to check executive appointments, and hence, granted the
President absolute appointing power. 30 As a delegate to, and Vice-President of, the ill-fated 1971 Constitutional
Convention, and more so as the presiding officer of most of its plenary session, I am aware that the Convention did not
provide for a commission on appointments on the theory that the Prime Minister, the head of the Government and the sole
appointing power, was himself a member of parliament. For this reason, there was no necessity for a separate body to
scrutinize his appointees. But should such appointees forfeit the confidence of the assembly, they are, by tradition,
required to resign, unless they should otherwise have been removed by the Prime Minister. 31 In effect, it is parliament
itself that "approves" such appointments. Unfortunately, supervening events forestalled our parliamentary experiment, and
beginning with the 1976 amendments and some 140 or so amendments thereafter, we had reverted to the presidential
form, 32 without provisions for a commission on appointments.

In fine, while Presidential appointments, under the first sentence of Section 16, of Article VII of the present Constitution,
must pass prior Congressional scrutiny, it is a test that operates as a mere safeguard against abuse with respect to those
appointments. It does not accord Congress any more than the power to check, but not to deny, the Chief Executive's
appointing power or to supplant his appointees with its own. It is but an exception to the rule. In limiting the Commission's
scope of authority, compared to that under the 1935 Constitution, I believe that the 1987 Constitution has simply
recognized the reality of that exception.

GUTIERREZ, JR., J., dissenting:

I join Justice Isagani A. Cruz in his dissent. I agree that the Constitution, as the supreme law of the land, should never
have any of its provisions interpreted in a manner that results in absurd or irrational consequences.

The Commission on Appointments is an important constitutional body which helps give fuller expression to the principles
inherent in our presidential system of government. Its functions cannot be made innocuous or unreasonably diminished to
the confirmation of a limited number of appointees. In the same manner that the President shares in the enactment of
laws which govern the nation, the legislature, through its Commission on Appointments, gives assurance that only those
who can pass the scrutiny of both the President and Congress will help run the country as officers holding high appointive
positions. The third sentence of the first paragraph — " ... The Congress may, by law, vest the appointment of other
officers lower in rank in the President alone, in the courts, or in the heads of departments, agencies, commissions, or
boards." — specifies only "officers lower in rank" as those who may, by law, be appointed by the President alone. If as
expounded in the majority opinion, only the limited number of officers in the first sentence of Section 16 require
confirmation, the clear intent of the third sentence is lost. In fact both the second and third sentences become
meaningless or superfluous. Superfluity is not to be read into such an important part of the Constitution.

I agree with the intervenor that all provisions of the Constitution on appointments must be read together. In providing for
the appointment of members of the Supreme Court and judges of lower courts (Section 9, Article VIII), the Ombudsman
and his deputies (Section 9, Article XI), the Vice President as a member of cabinet (Section 3, Article VII) and, of course,
those who by law the President alone may appoint, the Constitution clearly provides no need for confirmation. This can
only mean that all other appointments need confirmation. Where there is no need for confirmation or where there is an
alternative process to confirmation, the Constitution expressly so declares. Without such a declaration, there must be
confirmation.

The 1973 Constitution dispensed with confirmation by a Commission on Appointments because the government it set up
was supposed to be a parliamentary one. The Prime Minister, as head of government, was constantly accountable to the
legislature. In our presidential system, the interpretation which Justice Cruz and myself espouse, is more democratic and
more in keeping with the system of government organized under the Constitution.

I, therefore vote to grant the petition.

CRUZ, J., dissenting:

The view of the respondent, as adopted by the majority opinion, is briefly as follows: Confirmation is required only for the
officers mentioned in the first sentence of Section 16, to wit: (1) the heads of the executive departments; (2)
ambassadors, other public ministers and consuls; (3) officers of the armed forces from the rank of colonel or naval
captain; and (4) other officers whose appointments are vested in the President in the Constitution. No confirmation is
required under the second sentence for (1) all other officers whose appointments are not otherwise provided for by law,
and (2) those whom the President may be authorized by law to appoint. Neither is confirmation required by the third
sentence for those other officers lower in rank whose appointment is vested by law in the President alone.

Following this interpretation, the Undersecretary of Foreign Affairs, who is not the head of his department, does not have
to be confirmed by the Commission on Appointments, but the ordinary consul, who is under his jurisdiction, must be
confirmed. The colonel is by any standard lower in rank than the Chairman of the Commission on Human Rights, which
was created by the Constitution; yet the former is subject to confirmation but the latter is not because he does not come
under the first sentence. The Special Prosecutor, whose appointment is not vested by the Constitution in the President, is
not subject to confirmation under the first sentence, and neither are the Governor of the Central Bank and the members of
the Monetary Board because they fall under the second sentence as interpreted by the majority opinion. Yet in the case of
the multi-sectoral members of the regional consultative commission, whose appointment is vested by the Constitution in
the President under Article X, Section 18, their confirmation is required although their rank is decidedly lower.

I do not think these discrepancies were intended by the framers as they would lead to the absurd consequences we
should avoid in interpreting the Constitution.

There is no question that bureau directors are not required to be confirmed under the first sentence of Section 16, but that
is not the provision we ought to interpret. It is the second sentence we must understand for a proper resolution of the
issues now before us. Significantly, although there was a long discussion of the first sentence in the Constitutional
Commission, there is none cited on the second sentence either in the Solicitor-General's comment or in the majority
opinion. We can therefore only speculate on the correct interpretation of this provision in the light of the first and third
sentences of Section 16 or by reading this section in its totality.

The majority opinion says that the second sentence is the exception to the first sentence and holds that the two sets of
officers specified therein may be appointed by the President without the concurrence of the Commission on
Appointments. This interpretation is pregnant with mischievous if not also ridiculous results that presumably were not
envisioned by the framers.

One may wonder why it was felt necessary to include the second sentence at all, considering the majority opinion that the
enumeration in the first sentence of the officers subject to confirmation is exclusive on the basis of expressio unius est
exclusio alterius. If that be so, the first sentence would have been sufficient by itself to convey the Idea that all other
appointees of the President would not need confirmation.

One may also ask why, if the officers mentioned in the second sentence do not need confirmation, it was still felt
necessary to provide in the third sentence that the appointment of the other officers lower in rank will also not need
confirmation as long as their appointment is vested by law in the President alone. The third sentence would appear to be
superfluous, too, again in view of the first sentence.

More to the point, what will follow if Congress does not see fit to vest in the President alone the appointment of those
other officers lower in rank mentioned in the third sentence? Conformably to the language thereof, these lower officers will
need the confirmation of the Commission on Appointments while, by contrast, the higher officers mentioned in the second
sentence will not.

Thus, a regional director in the Department of Labor and the labor arbiters, as officers lower in rank than the bureau
director, will have to be confirmed if the Congress does not vest their appointment in the President alone under the third
sentence. On the other hand, their superior, the bureau director himself, will not need to be confirmed because, according
to the majority opinion, he falls not under the first sentence but the second. This is carefulness in reverse, like checking
the bridesmaids but forgetting the bride.

It must be borne in mind that one of the purposes of the Constitutional Commission was to restrict the powers of the
Presidency and so prevent the recurrence of another dictatorship. Among the many measures taken was the restoration
of the Commission on Appointments to check the appointing power which had been much abused by President Marcos.
We are now told that even as this body was revived to limit appointments, the scope of its original authority has itself been
limited in the new Constitution. I have to disagree.

My own reading is that the second sentence is but a continuation of the Idea expressed in the first sentence and simply
mentions the other officers appointed by the President who are also subject to confirmation. The second sentence is the
later expression of the will of the framers and so must be interpreted as complementing the rule embodied in the first
sentence or, if necessary, reversing the original intention to exempt bureau directors from confirmation. I repeat that there
were no debates on this matter as far as I know, which simply means that my humble conjecture on the meaning of
Section 16 is as arguable, at least, as the suppositions of the majority. We read and rely on the same records. At any rate,
this view is more consistent with the general purpose of Article VII, which, to repeat, was to reduce the powers of the
Presidency.

The respondent cites the following exchange reported in page 520, Volume II, of the Record of the Constitutional
Convention:

Mr. Foz: Madam President, this is the third proposed amendment on page 7, line 28, 1 propose to put a period (.) after
'captain' and on line 29, delete 'and all' and substitute it with HE SHALL ALSO APPOINT ANY.

Mr. Regalado: Madam President, the Committee accepts the proposed amendment because it makes it clear that those
other officers mentioned therein do not have to be confirmed by the Commission on Appointments.

However, the records do not show what particular part of Section 16 the committee chairman was referring to, and a
reading in its entirety of this particular debate will suggest that the body was considering the first sentence of the said
section, which I reiterate is not the controversial provision. In any case, although the excerpt shows that the proposed
amendment of Commissioner Foz was accepted by the committee, it is not reflected, curiously enough, in the final version
of Section 16 as a perusal thereof will readily reveal. Whether it was deleted later in the session or reworded by the style
committee or otherwise replaced for whatever reason will need another surmise on this rather confused Constitution.

I need only add that the records of the Constitutional Commission are merely extrinsic aids and are at best persuasive
only and not necessarily conclusive. Interestingly, some quarters have observed that the Congress is not prevented from
adding to the list of officers subject to confirmation by the Commission on Appointments and cite the debates on this
matter in support of this supposition. It is true enough that there was such a consensus, but it is equally true that this
thinking is not at all expressed, or even only implied, in the language of Section 16 of Article VII. Which should prevail
then the provision as worded or the debates?

It is not disputed that the power of appointment is executive in nature, but there is no question either that it is not absolute
or unlimited. The rule re- established by the new Constitution is that the power requires confirmation by the Commission
on Appointments as a restraint on presidential excesses, in line with the system of checks and balances. I submit it is the
exception to this rule, and not the rule, that should be strictly construed.

In my view, the only officers appointed by the President who are not subject to confirmation by the Commission on
Appointments are (1) the members of the judiciary and the Ombudsman and his deputies, who are nominated by the
Judicial and Bar Council; (2) the Vice-President when he is appointed to the Cabinet; and (3) "other officers lower in rank,"
but only when their appointment is vested by law in the President alone. It is clear that this enumeration does not include
the respondent Commissioner of Customs who, while not covered by the first sentence of Section 16, comes under the
second sentence thereof as I would interpret it and so is also subject to confirmation.

I vote to grant the petition.

Footnotes

1 66 Phil. 259, at 264.

2 The "other officers" whose appointments are vested in the President in the 1987 Constitution are:

1. Regular members of the Judicial and Bar Council (ART. VIII, Sec. 8(2);

2. Chairman and Commissioners of the Civil Service Commission (ART. IX-B, Sec. 1 (2);

3. Chairman and Commissioners of the Commission on Elections (ART. IX-C, Sec. 1(2);

4. Chairman and Commissioners of the Commission on Audit (ART. IX-D, Sec. 112); and,

5. Members of the regional consultative commission (ART. X, Sec. 18)

3 When Congress creates inferior offices and omits to provide for appointments to them, or provides in an unconstitutional
way for such appointment, the officers are within the meaning of the clause officers of the Government whose
appointments are not otherwise provided for by law" and the power to appoint such officers devolves on the President.
(USC, Const., Par, II, p. 529, citing Op., Atty. Gen. 213.)

4 The 1935 Constitution says "inferior officers" while the 1987 Constitution states "officers lower in rank. "

5 Example: Sen. Raul S. Manglapus was first nominated by the President for the position of Secretary of the Department
of Foreign Affairs (an executive department). After his nomination was confirmed by the Commission on Appointments,
the President appointed him Secretary of Foreign Affairs.

6 66 Phil. 259, at 265.

7 Pp. 384-385, Vol. 11, RECORD OF THE CONSTITUTIONAL COMMISSION OF 1986.

8 Pp. 433-435, Vol. 11, RECORD OF THE 1986 CONSTITUTIONAL COMMISSION.

9 The second sentence of Sec. 16, ART. VII of the 1987 Constitution refers to what this Decision calls the second and
third groups of officers appointed by the President.

10 Pp. 514-521, Vol. 11, RECORD OF THE 1986 CON- CONSTITUTIONAL COMMISSION.

Sarmiento, J.:

1 CONST., art. VII, sec. 16.

2 CONST. (1935), art. VII, sec. 10(3).

3 Sarmiento v. Mison, G.R. No. 79974, 6.

4 As Justice Padilla further notes, Section 16, of Article VII, was originally a verbatim copy of the 1935 provisions. Upon
further deliberations of the Constitutional Commission, however, the consensus was reached to amend the same to its
present form.

5 CONST., art. VII I, sec. 8 (2).

6 Supra, art. IX (B), see. 1 (2).

7 Supra, art. IX (C), sec. 1 (2).

8 Supra, art. IX (D), sec. 1 (2).

9 Sarmiento v. Mison, supra, Cruz., J., Dissenting, 5.

10 Supra, 3.

11 Concepcion v. Paredes, 42 Phil. 599 (1921); Government v. Springer, 50 Phil. 259 (1927); Springer v. P.I., 277 U.S.
189 (1929). The Supreme Court has been vested with the power to "[a]ppoint all officials of the Judiciary in accordance
with the Civil Service Law" [CONST., art. VIII, sec. 5(6)] but that is by fiat of the Constitution itself. (See also supra, art.
VII, sec. 16.). In Government v. Springer, supra, we recognized the authority of the legislature to appoint its officers but
only as "an incident to the discharge of its functions." (At 278). When the Constitution authorizes Congress to vest in the
President the appointment of other officers, it is not Congress being empowered to make the appointments; the President
retains his appointing power, through, however, a procedure established by Congress.

12 Supra, at 603.

13 Supra.
14 Angara v. Electoral Commission, 63 Phil. 139, 156 (1936).

15 Angara v. Electoral Commission, supra.

16 TRIBE, AMERICAN CONSTITUTIONAL LAW, 184-185 (1978), citing Buckley v. Valeo. 424 US 1 (1976).

17 Supra.

18 TRIBE, Id, 184.

19 Id., 184-185, citing Buckley v. Valeo, supra.

20 CONST., art. VII, sec. 5.

21 Buckley v. Valeo, supra.

22 CONST., art, IX (B), sec. 2 (3).

23 Myers v. United States, 272 US 52 (1926).

24 TRIBE, Id, at 188, citing Humphrey's Executor v. United States, 295 US 602 (1935).

25 Id., 11 No. L-20390, November 29, 1968,

26 SCRA 171 (1968).

27 CONST., art. VI, sec. 18.

28 Holmes, J, Dissenting, Springer v. Philippine Islands, supra, 210-212.

29 TRIBE, Id, 18-19; emphasis in original.

30 Sarmiento v. Mison, supra, 6.

31 CONST. (1973), art. IX, sec. 4; art. XII (B), sec. 3.

32 See Free Telephone Workers Union v. Minister of Labor and Employment, No. L-58184, October 30, 1981,108 SCRA
757 (1981).
7. Mayor v. Macaraig, 194 SCRA 672,G.R. No. 87211, 5 March 1991
G.R. No. 87211 March 5, 1991

JOVENCIO L. MAYOR petitioner,

vs.
HON. CATALINO MACARAIG, HON. GUILLERMO CARAGUE, HON. RIZALINA CAJUCOM, HON. FRANKLIN DRILON,
respondents. LOURDES A. SALES and RICARDO OLAIREZ, petitioners-intervenors.

G.R. No. 90044 March 5, 1991

PASCUAL V. REYES, petitioner,

vs.
HON. FRANKLIN DRILON, respondent.

G.R. No. 91547 March 5, 1991

CEFERINO E. DULAY, ROSARIO G. ENCARNACION and DANIEL LUCAS, JR., petitioners,

vs.
HON. CATALINO MACARAIG, JR., as Executive Secretary, HON. GUILLERMO N. CARAGUE, as Secretary of Budget
and Management, HON. DIONISIO DE LA SERNA, as Acting Secretary of Labor & Employment, BARTOLOME CARALE,
VICENTE S.E. VELOSO III, ROMEO B. TUOMO, EDNA BONTO PEREZ, DOMINGO H. ZAPANTA, RUSTICO L.
DIOKNO, LOURDES C. JAVIER, IRINEO B. BARNALDO, ROGELIO I. RAYALA, ERNESTO G. LADRINO III, IRENEA E.
CENIZA, BERNABE S. BATUHAN, MUSIB M. BUAT, L.B. GONZAGA, JR. and OSCAR ABELLA, respondents.

G.R. No. 91730 March 5, 1991

CONRADO B. MAGLAYA, petitioner,

vs.
HON. CATALINO MACARAEG, HON. GUILLERMO CARAGUE, HON. RIZALINA CAJOCUM, and the HONORABLE
SECRETARY OF LABOR, respondents.

G.R. No. 94518 March 5, 1991

ROLANDO D. GAMBITO, petitioner,

vs.
THE SECRETARY OF LABOR AND EMPLOYMENT and THE EXECUTIVE SECRETARY, respondents.

Ma. Luisa Y. Cortes for petitioner-intervenor Sales in G.R. No. 87211.

Jose C. Espinas for petitioners in G.R. Nos. 90044 & 91730.
Magtanggol C. Gunigundo for petitioners in G.R. No. 91547.

NARVASA, J.:

Five (5) special civil actions are hereby jointly decided because they involve one common, fundamental issue, the
constitutionality of Republic Act No. 6715, effective March 21, 1989, in so far as it declares vacant "all positions of the
Commissioners, Executive Labor Arbiters and Labor Arbiters of the National Labor Relations Commission," and operates
to remove the incumbents upon the appointment and qualification of their successors. The law is entitled, "AN ACT TO
EXTEND PROTECTION TO LABOR, STRENGTHEN THE CONSTITUTIONAL RIGHTS OF WORKERS TO SELF-
ORGANIZATION, COLLECTIVE BARGAINING AND PEACEFUL CONCERTED ACTIVITIES, FOSTER INDUSTRIAL
PEACE AND HARMONY, PROMOTE THE PREFERENTIAL USE OF VOLUNTARY MODES OF SETTLING LABOR
DISPUTES AND RE-ORGANIZE THE NATIONAL LABOR RELATIONS COMMISSION, AMENDING PRESIDENTIAL
DECREE NO. 441, AS AMENDED, OTHERWISE KNOWN AS THE LABOR CODE OF THE PHILIPPINES,
APPROPRIATING FUNDS THEREFOR AND FOR OTHER PURPOSES."1 The provision directly dealing with the
reorganization of the National Labor Relations Commission is Section 35. It reads as follows:2

Sec. 35. Equity of the Incumbent. — Incumbent career officials and rank-and-file employees of the National labor
Relations Commission not otherwise affected by the Act shall continue to hold office without need of reappointment.
However, consistent with the need to professionalize the higher levels of officialdom invested with adjudicatory powers
and functions, and to upgrade their qualifications, ranks, and salaries or emoluments, all positions of the Commissioners,
Executive Labor Arbiters and Labor Arbiters of the present National Labor Relations Commission are hereby declared
vacant. However, subject officials shall continue to temporarily discharge their duties and functions until their successors
shall have been duly appointed and qualified.

The first of these five consolidated cases was filed by Labor Arbiter Jovencio Ll. Mayor on March 8, 1989. In the year that
followed, eight other officers of the Commission, as initiators of their own separate actions or as intervenors, joined Mayor
in the attempt to invalidate the reorganization and to be reinstated to their positions in the Government service.

G.R. No. 87211: Jovencio Mayor; and Intervenors Lourdes A. Sales and Ricardo Olairez

Jovencio Ll. Mayor, a member of the Philippine Bar for fifteen (15) years, was appointed Labor Arbiter in 1986 after he
had, according to him, met the prescribed qualifications and passed "a rigid screening process." Fearing that he would be
removed from office on account of the expected reorganization, he filed in this Court the action now docketed as G.R. No.
87211. His fears proved groundless, however. He was in fact reappointed a Labor Arbiter on March 8, 1990. Hence, as he
himself says, the case became moot as to him.
Like Mayor, both intervenors Lourdes A. Sales and Ricardo N. Olairez were appointed Labor Arbiters in 1986, but unlike
Mayor, were not among the one hundred fifty-one (151) Labor Arbiters reappointed by the President on March 8, 1990.

G.R. No. 90044; Pascual Y Reyes; and Intervenor Eugenio L Sagmit, Jr.

At the time of the effectivity of R.A. No. 6715, Pascual Y. Reyes was holding the office of Executive Director of the
National Labor Relations Commission in virtue of an appointment extended to him on May 30, 1975. As specified by
Administrative Order No. 10 of the Secretary of Labor, dated July 14, 1975, the functions of his office were "to take charge
of all administrative matters of the Commission and to have direct supervision overall units and personnel assigned to
perform administrative tasks;" and Article 213 of the Labor Code, as amended, declared that the "Executive Director,
assisted by a Deputy Executive Director, shall exercise the administrative functions of the Commission." Reyes states that
he has been "a public servant for 42 years," and "is about to retire at sixty-five (65)," in 1991.

The petitioner-in-intervention, Eugenio I. Sagmit, Jr., was Reyes' Deputy Executive Director, appointed as such on
October 27, 1987 after twenty-five (25) years of government service.

Both Reyes and Sagmit were informed that they had been separated from employment upon the effectivity of R.A. No.
6715, pursuant to a Memorandum-Order issued by then Secretary of Labor Franklin Drilon on August 17, 1989 to the
effect that the offices of Executive Director and Deputy Executive Director had been abolished by Section 35, in relation to
Section 5 of said Act, and "their functions transferred to the Chairman, aided by the Executive Clerk.

Reyes moved for reconsideration on August 29, 1989, but when no action was allegedly taken thereon, he instituted the
action at bar, G.R. No. 90044. Sagmit was afterwards granted leave to intervene in the action.

G.R. No. 91547: Ceferino Dulay, Rosario G. Encarnacion, and Daniel M. Lucas

Petitioners Rosario G. Encarnacion and Daniel M. Lucas, Jr. were appointed National Labor Relations Commissioners on
October 20, 1986, after the Commission was reorganized pursuant to Executive Order No. 47 of President Aquino. Later,
or more precisely on November 19, 1986, Lucas was designated Presiding Commissioner of the Commission's Second
Division; and Commissioner Ceferino E. Dulay was appointed Presiding Commissioner of the Third Division.

Executive Order No. 252, issued by the President on July 25, 1987, amended Article 215 of the Labor Code by providing
that "the Commissioners appointed under Executive Order No. 47 dated September 10, 1986 shall hold office for a term of
six (6) years . . . (but of those thus appointed) three shall hold office for four (4) years, and three for two (2) years . . .
without prejudice to reappointment." Under Executive Order No. 252, the terms of Encarnacion and Lucas would expire on
October 23, 1992, and that of Dulay, on December 18, 1992.

On November 18, 1989, R.A. No. 6715 being then already in effect, the President extended to Encarnacion, Lucas and
Dulay new appointments as Commissioners of the NLRC despite the fact that, according to them, they had not been
served with notice of the termination of their services as incumbent commissioners, and no vacancy existed in their
positions. Their new appointments were submitted to Congress, but since Congress adjourned on December 22, 1989
without approving their appointments, said appointments became functus officio.

No other appointments were thereafter extended to Encarnacion and Dulay. Lucas was however offered the position of
Assistant Regional Director by Secretary Drilon and then by Acting Secretary Dionisio de la Serna (by letter dated January
9, 1990 which referred to his appointment as such Assistant Regional Director supposedly "issued by the President on
November 8, 1989"). Lucas declined the offer, believing it imported a demotion.

They all pray that their removal be pronounced unconstitutional and void and they be declared Commissioners lawfully in
office, or, alternatively, that they be paid all salaries, benefits and emoluments accruing to them for the unexpired portions
of their six-year terms and allowed to enjoy retirement benefits under applicable laws (pursuant to R.A. 910 and the
Resolution re Judge Mario Ortiz, G. R. No. 78951, June 28, 1988).

Of the incumbent Commissioners as of the effectivity of R.A. 6715, six (6) were reappointed, namely: (1) Hon. Edna Bonto
Perez (as Presiding Commissioner, Second Division NCR]), (2) Domingo H. Zapanta (Associate Commissioner, Second
Division), (3) Lourdes C. Javier (Presiding Commissioner, Third Division [Luzon except NCR]), (4) Ernesto G. Ladrido III
(Presiding Commissioner, Fourth Division [Visayas]), (5) Musib M. Buat (Presiding Commissioner, Fifth Division
[Mindanao]), and (6) Oscar N. Abella (Associate Commissioner, Fifth Division). Other members appointed to the
reorganized Commission were Vicente S.E. Veloso III, Romeo B. Putong, Rustico L. Diokno, Ireneo B. Bernardo, Rogelio
I. Rayala, Irenea E. Ceniza, Bernabe S. Batuhan, and Leon G. Gonzaga, Jr. Appointed Chairman was Hon. Bartolome
Carale, quondam Dean of the College of Law of the University of the Philippines.

G.R. No. 91730: Conrado Maglaya

Petitioner Conrado Maglaya alleges that he has been "a member of the Philippine Bar for thirty-six (36) years of which 31
years . . . (had been) devoted to public service, the last 24 years in the field of labor relations law;" that he was appointed
Labor Arbiter on May 30, 1975 and "was retained in such position despite the reorganization under the Freedom
Constitution of 1986 . . . (and) later promoted to and appointed by the President as Commissioner of the . . . (NLRC) First
Division on October 23, 1986." He complains that he was effectively removed from his position as a result of the
designation of the full complement of Commissioners in and to all Five Divisions of the NLRC by Administrative Order No.
161 dated November 18, 1989, issued by Labor Secretary Drilon.

G.R. No. 94518: Rolando D. Gambito

Rolando Gambito passed the bar examinations in 1971, joined the Government service in 1974, serving for sixteen years
in the Department of Health, and as Labor Arbiter in the Department of Labor and Employment from October, 1986. He
was not included in the list of newly appointed Labor Arbiters released on March 8, 1990; and his attempt to obtain a
recosideration of his exclusion therefrom and bring about his reinstatement as Labor Arbiter was unavailing.
The Basic Issue

A number of issues have been raised and ventilated by the petitioners in their separate pleadings. They may all be
reduced to one basic question, relating to the constitutionality of the provisions of Republic Act No. 6715 DECLARING
VACANT "all positions of the Commissioners, Executive Labor Arbiters and Labor Arbiters of the present National Labor
Relations Commission,"3 according to which the public respondents —

1) considered as effectively separated from the service inter alia, all holders of said positions at the time of the effectivity
of said Republic Act No. 6715, including the positions of Executive Director and Deputy Executive Director of the
Commission, and

2) consequently, thereafter caused the appointment of other persons to the new positions specified in said statute: of
Chairman Commissioners, Executive Clerk, Deputy Executive Clerk, and Labor Arbiters of the reorganized National Labor
Relations Commission. The old positions were declared vacant because, as the statute states, of "the need to
professionalize the higher levels of officialdom invested with adjudicatory powers and functions, and to upgrade their
qualifications, ranks, and salaries or emoluments."

As everyone knows, security of tenure is a protected right under the Constitution.1âwphi1 The right is secured to all
employees in privates as well as in public employment. "No officer or employee in the civil service," the Constitution
declares, "shall be removed or suspended except for cause provided by law."4

There can scarcely be any doubt that each of the petitioners — commissioner, administrative officer, or labor arbiter —
falls within the concept of an "officer or employee in the civil service" since the civil service "embraces all branches,
subdivisions, instrumentalities, and agencies of the Government, including government—owned or controlled corporations
with original charters."5 The Commissioners thus had the right to remain of office until the expiration of the terms for which
they had been appointed, unless sooner removed "for cause provided by law." So, too, the Executive Director and Deputy
Executive Director, and the Labor Arbiters had the right to retain their positions until the age of compulsory retirement,
unless sooner removed "for cause provided by law." None of them could be deemed to be serving at the pleasure of the
President.

Now, a recognized cause for several or termination of employment of a Government officer or employee is the abolition by
law of his office as a result of reorganization carried out by reason of economy or to remove redundancy of functions, or
clear and explicit constitutional mandate for such termination of employment.6 Abolition of an office is obviously not the
same as the declaration that that office is vacant. While it is undoubtedly a prerogative of the legislature to abolish certain
offices, it can not be conceded the power to simply pronounce those offices vacant and thereby effectively remove the
occupants or holders thereof from the civil service. Such an act would constitute, on its face, an infringement of the
constitutional guarantee of security of tenure, and will have to be struck down on that account. It can not be justified by the
professed "need to professionalize the higher levels of officialdom invested with adjudicatory powers and functions, and to
upgrade their qualifications, ranks, and salaries or emoluments."

The Constitution does not, of course, ordain the abolition of the petitioners' positions of their removal from their offices;
and there is no claim that the petitioners' separation from the service is due to a cause other than RA 6715. The inquiry
therefore should be whether or not RA 6715 has worked such an abolition of the petitioners' offices, expressly or
impliedly. This is the only mode by which, under the circumstances, the petitioners' removal from their positions may be
defended and sustained.

It is immediately apparent that there is no express abolition in RA 6715 of the petitioners' positions. So, justification must
be sought, if at all, in an implied abolition thereof; i.e., that resulting from an irreconcilable inconsistency between the
nature, duties and functions of the petitioners' offices under the old rules and those corresponding thereof under the new
law. An examination of the relevant provisions of RA 6715, with a view to discovering the changes thereby effected on the
nature, composition, powers, duties and functions of the Commission and the Commissioners, the Executive Director, the
Deputy Executive Director, and the labor Arbiters under the prior legislation, fails to disclose such essential
inconsistencies.

1. Amendments as Regards the NLRC and the Commissioners

First, as regards the National Labor Relations Commissioners.

A. Nature and Composition of the Commission, Generally

1. Prior to its amendment by RA 6715, Article 213 of the Labor Code envisaged the NLRC as being an integral part of the
Department of labor and Employment. "There shall," it said, "be a National Labor Relations Commission in the
Department of Labor and Employment . . . ." RA 6715 would appear to have made the Commission somewhat more
autonomous. Article 213 now declares that, "There shall be a National labor Relations Commission which shall be
attached to the Department of labor and Employment for program coordination only . . . ."

2. Tripartite representation was to a certain extent restored in the Commission. The same Section 213, as amended, now
provides that the Chairman and fourteen (14) members composing the NLRC shall be chosen from the workers',
employers' and the public sectors, as follows:

Five (5) members each shall be chosen from among the nominees of the workers and employers organization,
respectively. The Chairman and the four (4) remaining members shall come from the public sector, with the latter to be
chosen from among the recommendees of the Secretary of Labor and Employment.

However, once they assume office," the members nominated by the workers and employers organizations shall divest
themselves of any affiliations with or interest in the federation or association to which they belong."
B. Allocation of Powers Between NLRC En Banc and its Divisions

Another amendment was made in respect of the allocation of powers and functions between the Commission en banc, on
the one hand, and its divisions, on the other. Both under the old and the amended law, the Commission was vested with
rule-making and administrative authority, as well as adjudicatory and other powers, functions and duties, and could sit en
banc or in divisions of three (3) members each. But whereas under the old law, the cases to be decided en banc and
those by a division were determined by rules laid down by the Commission with the approval of the ex officio, Chairman
(the Secretary of labor) — said Commission, in other words, then exercise both administrative and adjudicatory powers —
the law now, as amended by RA 6715, provides that —

1) the Commission "shall sit en banc only for purposes of promulgating rules and regulations governing the hearing and
disposition of cases before any of its divisions and regional branches and formulating policies affecting its administration
and operations;" but

2) it "shall exercise its adjudicatory and all other powers, functions and duties through its divisions."

C. Official Stations, and Appellate Jurisdiction over Fixed Territory

Other changes related to the official station of the Commission and its divisions, and the territory over which the divisions
could exercise exclusive appellate jurisdiction.

1. Under the old law, the Commission en banc and its divisions had their main office in Metropolitan Manila; and appeals
could be taken to them from decisions of Labor Arbiters regardless of the regional office whence the case originated.

2. Under the law now, the First and Second Divisions have their official station in Metropolitan Manila and "handle cases
coming from the National Capital Region;" the Third Division has its main office also in Metropolitan Manila but would
have appellate jurisdiction over "cases from other parts of Luzon;" and the Fourth and Fifth Divisions have their main
offices in Cebu and Cagayan de Oro City, and exercise jurisdiction over cases "from the Visayas and Mindanao,"
respectively; and the appellate authority of the divisions is exclusive "within their respective territorial jurisdiction."

D. Qualifications and Tenure of Commissioners

Revisions were also made by RA 6715 with respect to the qualifications and tenure of the National Labor Relations
Commissioners.

Prescribed by the old law as qualifications for commissioners — appointed for a term of six (6) years — were that they (a)
by members of the Philippine bar, and (b) have at least five years' experience in handling labor-management relations.7

RA 6715, on the other hand, requires (a) membership in the bar, (b) engagement in the practice of law for at least 15
years, (c) at least five years' experience or exposure in the field of labor-management relations, and (d) preferably,
residence in the region where the commissioner is to hold office. The commissioners appointed shall hold office during
good behavior until they reach the age of sixty-five (65) years, unless they are sooner removed for cause as provided by
law or become incapacited to discharge the duties of their office.

2. Amendments Regarding Executive Labor Arbiters and Labor Arbiters

A. Qualifications

The old provided for one hundred fifty (150) labor arbiters assigned to the different regional offices or branches of the
Department of Labor and Employment (including sub-regional branches or provincial extension units), each regional
branch being headed by an Executive Labor Arbiter. RA 6715 does not specify any fixed number of labor arbiters, but
simply provides that there shall be as many labor arbiters as may be necessary for the effective and efficient operation of
the Commission.

The old law declared that Executive Labor Arbiters and Labor Arbiters should be members of the Bar, with at least two (2)
years experience in the field of labor management relations. They were appointed by the President upon recommendation
of the Chairman, and were "subject to the Civil Service Law, rules and regulations."

On the other hand, RA 6715 requires that the "Executive Labor Arbiters and Labor Arbiters shall likewise be members of
the Philippine Bar," but in addition "must have been in the practice of law in the Philippines for at least seven (7) years,
with at least three (3) years experience or exposure in the field of labor-management relations." For "purposes of
reappointment," however, "incumbent Executive Labor Arbiters and Labor Arbiters who have been engaged in the practice
of law for at least five (5) years may be considered as already qualified." They are appointed by the President, on
recommendation of the Secretary of Labor and Employment, and are subject to the Civil Service Law, rules and
regulations.

B. Exclusive Original Jurisdiction

Before the effectivity of RA 6715, the exclusive original jurisdiction of labor arbiters comprehended the following cases
involving all workers, whether agricultural or non-agricultural:

(1) Unfair labor practice cases;

(2) Those that workers may file involving wages, hours of work and other terms and conditions of employment;

(3) All money claims of workers, including those based on non-payment or underpayment of wages, overtime
compensation, separation pay and other benefits provided by law or appropriate agreement, except claims for employees'
compensation, social security, medicare and maternity benefits;
(4) Cases involving household services; and

(5) Cases arising from any violation of Article 265 of this Code, including questions involving the legality of strikes and
lockouts.

Some changes were introduced by RA 6715, indicated by italics in the enumeration which shortly follows. The exclusive,
original jurisdiction of Labor Arbiters now embraces the following involving all workers, whether agricultural or non-
agricultural:

(1) Unfair labor practice cases;

(2) Termination disputes;

(3) If accompanies with a claim for reinstatement, those cases that workers may file involving wages, rates of pay, hours
of work and other terms and conditions of employment;

(4) Claims for actual, moral, exemplary and other forms of damages arising from the employer-employee relations;8

(5) Cases arising from any violation of Article 264 of this Code, including questions involving the legality of strikes and
lockouts;

(6) Except claims for employees compensation, social security, medicare and maternity benefits, all other claims arising
from employer-employee relations, including those of persons in domestic or household service, involving an amount
exceeding five thousand pesos (P5,000.00), whether or not accompanies with a claim for reinstatement.

Now, as before, the Labor Arbiters are given thirty (30) calendar days after the submission of the case by the parties to
decide the case, without extension, except that the present statute stresses that "even in the absence of stenographic
notes," the period to decide is still thirty days, without extension.

Furthermore, RA 6715 provides that "Cases arising from the interpretation or implementation of collective bargaining
agreements and those arising from the interpretation or enforcement of company personnel policies shall be disposed of
by the Labor Arbiter by referring the same to the grievance machinery and voluntary arbitration as may be provided in said
agreements."

3. Amendments as Regards the Executive Director and Deputy Executive Director

Prior to RA 6715, there was, as earlier stated, an Executive Director, assisted by a Deputy Executive Director, who was
charged with the "exercise (of) the administrative functions of the Commission."9 More particularly, his chief functions
were "to take charge of all administrative matters of the Commission and to have direct supervision over all units and
personnel assigned to perform administrative tasks."10 Although not so stated in the law, in the performance of their
functions, the Executive Director and the Deputy Executive Director were obviously themselves subject to the supervision
and control of the head of office, the ex officio Chairman of the National Labor Relations Commission (the Secretary of
Labor), or the Commission itself.

Under RA 6715, the Secretary of Labor is no longer ex officio Chairman of the Commission. There has been created the
office of Chairman, who "shall have the administrative supervision over the Commission and its regional branches and all
its personnel, including the Executive Labor Arbiters and Labor Arbiters." In this function, the law says, he shall be "aided
by the Executive Clerk of the Commission."

The Executive Clerk appears to be the officer who used to be known under the old law as the Executive Director. The
office of Executive Director is nowhere mentioned in RA 6715. Said Executive Clerk is given the additional responsibility
of assisting the Commission en banc and the First Division, in performing "such similar or equivalent functions and duties
as are discharged by the Clerk of Court . . . of the Court of Appeals." The position of Deputy Executive Clerks have also
been created whose main role is to assist the other divisions of the Commission (the second, third, fourth and fifth) "in the
performance of such similar or equivalent functions and duties as are discharged by the . . . Deputy Clerk(s) of the Court
of Appeals."

Summing up —

1. Republic Act No. 6715 did not abolish the NLRC, or change its essential character as a supervisory and adjudicatory
body. Under said Act, as under the former law, the NLRC continues to act collegially, whether it performs administrative or
rule-making functions or exercises appellate jurisdiction to review decisions and final orders of the Labor Arbiters. The
provisions conferring a somewhat greater measure of autonomy; requiring that its membership be drawn from tripartite
sectors (workers, employees and the public sector); changing the official stations of the Commission's divisions, and even
those prescribing higher or other qualifications for the positions of Commissioner which, if at all, should operate only
prospectively, not to mention the fact that the petitioners (in G.R. No. 91547) have asserted without dispute that they
possess the new qualifications — none of these can be said to work so essential or radical a revision of the nature,
powers and duties of the NLRC as to justify a conclusion that the Act in truth did not merely declare vacant but actually
abolished the offices of commissioners and created others in their place.

2. Similar considerations yield the same conclusion as far as the positions of Labor Arbiters are concerned, there being no
essential inconsistency on that score between Republic Act No. 6715 and the old law. The Labor Arbiters continue to
exercise the same basic power and function: the adjudication, in the first instance, of certain classes of labor disputes.
Their original and exclusive jurisdiction remains substantially the same under both the old law and the new. Again, their
incumbents' constitutionally guaranteed security of tenure cannot be defeated by the provision for higher or other
qualifications than were prescribed under the old law; said provision can only operate prospectively and as to new
appointees to positions regularly vacated; and there is, besides, also no showing that the petitioning Arbiters do not
qualify under the new law.

3. The position titles of "Executive Clerk" and "Deputy Executive Clerk(s)" provided for in RA 6715 are obviously not those
of newly-created offices, but new appellations or designations given to the existing positions of Executive Director and
Deputy Executive Director. There is no essential change from the prescribed and basically administrative duties of these
positions and, at the same time, no mention in the Act of the former titles, from which the logical conclusion is that what
was intended was merely a change in nomenclature, not an express or implied abolition. Neither does the Act specify the
qualifications for Executive Clerk and Deputy Executive Clerks. There is no reason to suppose that these could be higher
than those for Executive Director and Deputy Executive Director, or that anything inheres in these positions that would
preclude their incumbents from being named Executive Clerk and Deputy Executive Clerks.

WHEREFORE, the petitions are, as they must be, GRANTED , and the following specific dispositions are hereby
RENDERED:

1. In G.R. No. 91547, and G.R. No. 91730, the removal of petitioners Rosario G. Encarnacion, Daniel M. Lucas, Jr.,
Ceferino E. Dulay, and Conrado Maglaya as Commissioners of the NLRC is ruled unconstitutional and void; however, to
avoid displacement of any of the incumbent Commissioners now serving, it not appearing that any of them is unfit or has
given cause for removal, and conformably to the alternative prayer of the petitioners themselves, it is ORDERED that said
petitioners be paid all salaries, benefits and emoluments accruing to them for the unexpired portions of their six-year
terms and allowed to enjoy retirement benefits under applicable laws, pursuant to RA No. 910 and this Court's Resolution
in Ortiz vs. Commission on Elections, G.R. No. 79857, 161 SCRA 812;

This disposition does not involve or apply to respondent Hon. Bartolome Carale, who replaced the Secretary of Labor as
ex officio Chairman of the NLRC pursuant to RA 6715, none of the petitioners having been affected or in any manner
prejudiced by his appointment and incumbency as such;

2. In G.R. No. 90044, the removal of petitioner Pascual Y. Reyes and petitioner-in-intervention Eugenio L. Sagmit, Jr. as
NLRC Executive Director and Deputy Executive Director, respectively, is likewise declared unconstitutional and void, and
they are ordered reinstated as Executive Clerk and Deputy Executive Clerk, respectively, unless they opt for retirement, in
either case with full back salaries, emoluments and benefits from the date of their removal to that of their reinstatement;
and

3. In G.R. Nos. 87211, and 94518, petitioners-intervenors Lourdes A. Sales and Ricardo Olairez and petitioner Rolando
D. Gambito, having also been illegally removed as Labor Arbiters, are ordered reinstated to said positions with full back
salaries, emoluments and benefits from the dates of their removal up to the time they are reinstated.

No pronouncement as to costs.

SO ORDERED.
8. Calderon v, Carale G.R. No. 91636, 23 April 1992
[G.R. No. 91636. April 23, 1992.]

PETER JOHN D. CALDERON, Petitioner, v. BARTOLOME CARALE, in his capacity as Chairman of the National Labor
Relations Commission; EDNA BONTO PEREZ, LOURDES C. JAVIER, ERNESTO G. LADRIDO III, MUSIB M. BUAT,
DOMINGO H. ZAPANTA, VICENTE S.E. VELOSO III, IRENEO B. BERNARDO, IRENEA E. CENIZA, LEON G.
GONZAGA, JR., ROMEO B. PUTONG, ROGELIO I. RAYALA, RUSTICO L. DIOKNO, BERNABE S. BATUHAN, and
OSCAR N. ABELLA, in their capacity as Commissioners of the National Labor Relations Commission; and GUILLERMO
CARAGUE, in his capacity as Secretary of Budget and Management, Respondents.

Rafael Antonio M. Santos for Petitioner.

SYLLABUS

1. POLITICAL LAW; LEGISLATIVE DEPARTMENT; COMMISSION ON APPOINTMENT; POWER OF CONFIRMATION

OVER APPOINTMENTS BY THE PRESIDENT RULE. — From the cases of Sarmiento III v. Mison (156 SCRA 549); Mary
Concepcion Bautista v. Salonga (172 SCRA 160), and Teresita Quintos Deles, Et. Al. v. The Commission on
Constitutional Commission, et al (177 SCRA 259), these doctrines are deducible: 1. Confirmation by the Commission on
Appointments is required only for presidential appointees mentioned in the first sentence of Section 16, Article VII,
including, those officers whose appointments are expressly vested by the Constitution itself in the president (like sectoral
representatives to Congress and members of the constitutional commissions of Audit, Civil Service and Election). 2.
Confirmation is not required when the President appoints other government officers whose appointments are not
otherwise provided for by law or those officers whom he may be authorized by law to appoint (like the Chairman and
Members of the Commission on Human Rights). Also, as observed in Mison, when Congress creates inferior offices but
omits to provide for appointment thereto, or provides in an unconstitutional manner for such appointments, the officers are
considered as among those whose appointments are not otherwise provided for by law.

2. ID.; ID.; ID.; CONFIRMATION OF APPOINTMENTS OF THE CHAIRMAN AND MEMBERS OF THE NATIONAL
LABOR RELATIONS COMMISSION AS PROVIDED UNDER R.A. 6715; UNCONSTITUTIONAL; REASONS
THEREFOR. — The second sentence of Sec. 16, Art. VII refers to all other officers of the government whose appointment
are not otherwise provided for by law and those whom the President may be authorized by law to appoint. Indubitably, the
NLRC Chairman and Commissioners fall within the second sentence of Section 16, Article VII of the Constitution, more
specifically under the "third groups" of appointees referred to in Mison, i.e. those whom the President may be authorized
by law to appoint. Undeniably, the Chairman and Members of the NLRC are not among the officers mentioned in the first
sentence of Section 16, Article VII whose appointments requires confirmation by the Commission on Appointments. To
the extent that RA 6715 requires confirmation by the Commission on Appointments of the appointments of respondents
Chairman and Members of the National Labor Relations Commission, it is unconstitutional because: 1) it amends by
legislation, the first sentence of Sec. 16, Art. VII of the Constitution by adding thereto appointments requiring confirmation
by the Commission on Appointments; and 2) it amends by legislation the second sentence of Sec. 16, Art. VII of the
Constitution, by imposing the confirmation of the Commission on Appointments on appointments which are otherwise
entrusted only with the President. Deciding on what law to pass is a legislative prerogative. Determining their
constitutionality is a judicial function. The Court respects the laudable intention of the legislature. Regretfully, however, the
constitutional infirmity of Sec. 13 of RA 6715 amending Art. 215 of the Labor Code, insofar as it requires confirmation of
the Commission on Appointments over appointments of the Chairman and Members of the National Labor Relations
Commission (NLRC) is, as we see it, beyond redemption if we are to render fealty to the mandate of the Constitution in
Sec. 16, Art. VII thereof.

3. ID.; ID.; CANNOT EXPAND A CONSTITUTIONAL PROVISION AFTER THE SUPREME COURT HAS INTERPRETED
IT; ENDENCIA AND JUGO VS. DAVID (193 PHIL. 699) CITED. — In Endencia and Jugo v. David, the Court held: . . .
"The rule is recognized elsewhere that the legislature cannot pass any declaratory act, or act declaratory of what the law
was before its passage, so as to give it any binding weight with the courts. A legislative definition of a word as used in a
statute is not conclusive of its meaning as used elsewhere; otherwise, the legislature would be usurping a judicial function
in defining a term. (11 Am. Jur., 914, Emphasis supplied).’The legislature cannot, upon passing law which violates a
constitutional provision, validate it so as to prevent an attack thereon in the courts, by a declaration that it shall be so
construed as not to violate the constitutional inhibition." (11 Am., Jur., 919, Emphasis supplied). "We have already said
that the Legislature under our form of government is assigned the task and the power to make and enact laws, but not to
interpret them. This is more true with regard to the interpretation of the basic law, the Constitution, which is not within the
sphere of the Legislative department. If the Legislature may declare what a law means, or what a specific portion of the
Constitution means, especially after the courts have in actual case ascertained its meaning by interpretation and applied it
in a decision, this would surely cause confusion and instability in judicial processes and court decision. Under such a
system, a final court determination of a case based on a judicial interpretation of the law or of the Constitution may be
undermined or even annulled by a subsequent and different interpretation of the law or of the Constitution by the
Legislative department. That would be neither wise nor desirable, besides being clearly violative of the fundamental
principles of our constitutional system of government, particularly those governing the separation of powers."cralaw
virtua1aw library

4. ID.; ID.; LIMITATION ON THE POWER OF CONFIRMATION OVER PRESIDENTIAL APPOINTMENTS; PURPOSE. —
It can not be overlooked that Sec. 16, Art. VII of the 1987 Constitution was deliberately, not unconsciously, intended by
the framers of the 1987 Constitution to be a departure from the system embodied in the 1935 Constitution where the
Commission on Appointments exercised the power of confirmation over almost all presidential appointments, leading to
may cases of abuse of such power of confirmation. The deliberate limitation on the power of confirmation of the
Commission on Appointments over presidential appointments, embodied in Sec. 16, Art. VII of the 1987 Constitution, has
undoubtedly evoked the displeasure and disapproval of members of the Congress. The solution to the apparent problem,
if indeed a problem, is not judicial or legislative but constitutional. A future constitutional convention or Congress sitting as
a constituent (constitutional) assembly may then consider either a return to the 1935 Constitutional provisions or the
adoption of a hybrid system between the 1935 and 1987 constitutional provisions. Until then, it is the duty of the Court to
apply the 1987 Constitution in accordance with what it says and not in accordance with how the legislature or the
executive would want it interpreted.

5. ID.; JUDICIAL DEPARTMENT; SUPREME COURT; DECISIONS THEREOF APPLYING OR INTERPRETING THE
CONSTITUTION; FORM PART OF THE LEGAL SYSTEM OF THE PHILIPPINES. — Supreme Court decisions applying
or interpreting the Constitution shall form part of the legal system of the Philippines. No doctrine or principle of law laid
down by the Court in a decision rendered en banc or in division may be modified or reversed except by the Court sitting
en banc.." . . The interpretation upon a law by this Court constitutes, in a way, a part of the law as of the date that law was
originally passed, since this Court’s construction merely establishes the contemporaneous legislative intent that the law
thus construed intends to effectuate. The settled rule supported by numerous authorities is a restatement of the legal
maxim ‘legis interpretado legis vim obtinent’ — the interpretation placed upon the written law by a competent court has the
force of law."cralaw virtua1aw library

6. ID.; ID.; ID.; FUNCTION THEREOF IN PASSING UPON AN ACT OF CONGRESS. — Congress, of course, must
interpret the Constitution, must estimate the scope of its constitutional powers when it sets out to enact legislation and it
must take into account the relevant constitutional prohibitions.." . . The Constitution did not change with public opinion. It is
not only the same words, but the same in meaning . . . and as long as it speaks not only in the same words, but with the
same meaning and intent with which it spoke when it came from the hands of its framers, and was voted and adopted by
the people . . ." The function of the Court in passing upon an act of Congress is to "lay the article of the Constitution which
is invoked beside the statute which is challenged and to decide whether the latter squares with the former" and to
"announce its considered judgment upon the question."

DECISION

PADILLA, J.:

Controversy is focused anew on Sec. 16, Art. VII of the 1987 Constitution which provides:jgc:chanrobles.com.ph

"SECTION 16. The President shall nominate and, with the consent of the Commission on Appointments, appoint the
heads of the executive departments, ambassadors, other public ministers and consuls, or officers of the armed forces
from the rank of colonel or naval captain, and other officers whose appointments are vested in him in this Constitution. He
shall also appoint all other officers of the Government whose appointments are not otherwise provided for by law, and
those whom he may be authorized by law to appoint. The Congress may, by law, vest the appointment of other officers
lower in rank in the President alone, in the courts, or in the heads of departments, agencies, commissions, or boards.

"The President shall have the power to make appointments during the recess of the Congress, whether voluntary or
compulsory, but such appointments shall be effective only until disapproval by the Commission on Appointments or until
the next adjournment of the Congress." 1

The power of the Commission on Appointments (CA for brevity) to confirm appointments, contained in the aforequoted
paragraph 1 Sec. 16, Art. VII, was first construed in Sarmiento III v. Mison 2 as follows:jgc:chanrobles.com.ph

". . . it is evident that the position of Commissioner of the Bureau of Customs (a bureau head) is not one of those within
the first group of appointments where the consent of the Commission on Appointments is required. As a matter of fact, as
already pointed out, while the 1935 Constitution includes ‘heads of bureaus’ among those officers whose appointments
need the consent of the Commission on Appointments, the 1987 Constitution, on the other hand, deliberately excluded
the position of `heads of bureaus’ from appointments that need the consent (confirmation) of the Commission on
Appointments.

". . . Consequently, we rule that the President of the Philippines acted within her constitutional authority and power in
appointing respondent Salvador Mison, Commissioner of the Bureau of Customs, without submitting his nomination to the
Commission on Appointments for confirmation . . ."cralaw virtua1aw library

". . . In the 1987 Constitution, however, as already pointed out, the clear and expressed intent of its framers was to
exclude presidential appointments from confirmation by the Commission on Appointments, except appointments to offices
expressly mentioned in the first sentence of Sec. 16, Art. VII. Consequently, there was no reason to use in the third
sentence of Sec. 16, Article VII the word ‘alone’ after the word ‘President’ in providing that Congress may by law vest the
appointment of lower-ranked officers in the President alone, or in the courts, or in the heads of the departments, because
the power to appoint officers whom he (the President) may be authorized by law to appoint is already vested in the
President, without need of confirmation by the Commission on Appointments, in the second sentence of the same Sec.
16, Article VII." (Emphasis supplied).

Next came Mary Concepcion Bautista v. Salonga, 3 this time involving the appointment of the Chairman of the
Commission on Human Rights. Adhering to the doctrine in Mison, the Court explained:jgc:chanrobles.com.ph

". . . Since the position of Chairman of the Commission on Human Rights is not among the positions mentioned in the first
sentence of Sec. 16, Art. VII of the 1987 Constitution, appointments to which are to be made with the confirmation of the
Commission on Appointments, it follows that the appointment by the President of the Chairman of the CHR is to be made
without the review or participation of the Commission on Appointments. To be more precise, the appointment of the
Chairman and Members of the Commission on Human Rights is not specifically provided for in the Constitution itself,
unlike the Chairmen and Members of the Civil Service Commission, the Commission on Elections and the Commission on
Audit, whose appointments are expressly vested by the Constitution in the President with the consent of the Commission
on Appointments. The President appoints the Chairman and Members of the Commission on Human Rights pursuant to
the second sentence in Section 16, Art. VII, that is, without the confirmation of the Commission on Appointments because
they are among the officers of government ‘whom he (the President) may be authorized by law to appoint.’ And Section
2(c), Executive Order No. 163, 5 May 1987, authorizes the President to appoint the Chairman and Members of the
Commission on Human Rights."cralaw virtua1aw library

Consistent with its rulings in Mison and Bautista, in Teresita Quintos Deles, Et. Al. v. The Commission on Constitutional
Commissions, et al, 4 the power of confirmation of the Commission on Appointments over appointments by the President
of sectoral representatives in Congress was upheld because:jgc:chanrobles.com.ph

". . . Since the seats reserved for sectoral representatives in paragraph 2, Section 5, Art. VI may be filled by appointment
by the President by express provision of Section 7, Art. XVIII of the Constitution, it is indubitable that sectoral
representatives to the House of Representatives are among the ‘other officers whose appointments are vested in the
President in this Constitution,’ referred to in the first sentence of Section 16, Art. VII whose appointments are subject to
confirmation by the Commission on Appointments."cralaw virtua1aw library

From the three (3) cases above-mentioned, these doctrines are deducible:chanrob1es virtual 1aw library

1. Confirmation by the Commission on Appointments is required only for presidential appointees mentioned in the first
sentence of Section 16, Article VII, including, those officers whose appointments are expressly vested by the Constitution
itself in the president (like sectoral representatives to Congress and members of the constitutional commissions of Audit,
Civil Service and Election).

2. Confirmation is not required when the President appoints other government officers whose appointments are not
otherwise provided for by law or those officers whom he may be authorized by law to appoint (like the Chairman and
Members of the Commission on Human Rights). Also, as observed in Mison, when Congress creates inferior offices but
omits to provide for appointment thereto, or provides in an unconstitutional manner for such appointments, the officers are
considered as among those whose appointments are not otherwise provided for by law.

Sometime in March 1989, RA 6715 (Herrera-Veloso Law), amending the Labor Code (PD 442) was approved. It provides
in Section 13 thereof as follows:jgc:chanrobles.com.ph

"x x x

The Chairman, the Division Presiding Commissioners and other Commissioners shall all be appointed by the President,
subject to confirmation by the Commission on Appointments. Appointments to any vacancy shall come from the nominees
of the sector which nominated the predecessor. The Executive Labor Arbiters and Labor Arbiters shall also be appointed
by the President, upon recommendation of the Secretary of Labor and Employment, and shall be subject to the Civil
Service Law, rules and regulations." 5

Pursuant to said law (RA 6715), President Aquino appointed the Chairman and Commissioners of the NLRC representing
the public, workers and employers sectors. The appointments stated that the appointees may qualify and enter upon the
performance of the duties of the office. After said appointments, then Labor Secretary Franklin Drilon issued
Administrative Order No. 161, series of 1989, designating the places of assignment of the newly appointed
commissioners.chanrobles virtual lawlibrary

This petition for prohibition questions the constitutionality and legality of the permanent appointments extended by the
President of the Philippines to the respondents Chairman and Members of the National Labor Relations Commission
(NLRC), without submitting the same to the Commission on Appointments for confirmation pursuant to Art. 215 of the
Labor Code as amended by said RA 6715.

Petitioner insists on a mandatory compliance with RA 6715 which has in its favor the presumption of validity. RA 6715 is
not, according to petitioner, an encroachment on the appointing power of the executive contained in Section 16, Art. VII, of
the Constitution, as Congress may, by law, require confirmation by the Commission on Appointments of other officers
appointed by the President additional to those mentioned in the first sentence of Section 16 of Article VII of the
Constitution. Petitioner claims that the Mison and Bautista rulings are not decisive of the issue in this case for in the case
at bar, the President issued permanent appointments to the respondents without submitting them to the CA for
confirmation despite passage of a law (RA 6715) which requires the confirmation by the Commission on Appointments of
such appointments.

The Solicitor General, on the other hand, contends that RA 6715 which amended the Labor Code transgresses Section
16, Article VII by expanding the confirmation powers of the Commission on Appointments without constitutional basis.
Mison and Bautista laid the issue to rest, says the Solicitor General, with the following exposition:chanrobles.com : virtual
law library

"As interpreted by this Honorable Court in the Mison case, confirmation by the Commission on Appointments is required
exclusively for the heads of executive departments, ambassadors, public ministers, consuls, officers of the armed forces
from the rank of colonel or naval captain, and other officers whose appointments are vested in the President by the
Constitution, such as the members of the various Constitutional Commissions. With respect to the other officers whose
appointments are not otherwise provided for by the law and to those whom the President may be authorized by law to
appoint, no confirmation by the Commission on Appointments is required.

"Had it been the intention to allow Congress to expand the list of officers whose appointments must be confirmed by the
Commission on Appointments, the Constitution would have said so by adding the phrase "and other officers required by
law" at the end of the first sentence, or the phrase, "with the consent of the Commission on Appointments" at the end of
the second sentence. Evidently, our Constitution has significantly omitted to provide for such additions.

"The original text of Section 16 of Article VII of the present Constitution as embodied in Resolution No. 517 of the
Constitutional Commission reads as follows:chanrob1es virtual 1aw library
‘The President shall nominate and, with the consent of the Commission on Appointments, shall appoint the heads of the
executive departments and bureaus, ambassadors, other public ministers and consuls, or officers of the armed forces
from the rank of captain or commander, and all other officers of the Government whose appointments are not herein
otherwise provided for by law, and those whom he may be authorized by law to appoint. The Congress may by law vest
the appointment of inferior officers in the President alone, in the courts or in the head of the department.’

"Three points should be noted regarding subsection 3 of Section 10 of Article VII of the 1935 Constitution and in the
original text of Section 16 of Article VII of the present Constitution as proposed in Resolution No. 517.

"First, in both of them, the appointments of head of bureaus were required to be confirmed by the Commission on
Appointments.

"Second, in both of them, the appointments of other officers, "whose appointments are not otherwise provided for by law
to appoint" are expressly made subject to confirmation by the Commission on Appointments. However, in the final version
of Resolution No. 517, as embodied in Section 16 of Article VII of the present Constitution, the appointment of the above
mentioned officers (heads of bureaus; other officers whose appointments are not provided for by law; and those whom he
may be authorized by law to appoint) are excluded from the list of those officers whose appointments are to be confirmed
by the Commission on Appointments. This amendment, reflected in Section 16 of Article VII of the Constitution, clearly
shows the intent of the framers to exclude such appointments from the requirement of confirmation by the Commission on
Appointments.

"Third, under the 1935 Constitution the word "nominate" qualifies the entire Subsection 3 of Section 10 of Article VII
thereof.

"Respondent reiterates that if confirmation is required, the three (3) stage process of nomination, confirmation and
appointment operates. This is only true of the first group enumerated in Section 16, but the word nominate does not any
more appear in the 2nd and 3rd sentences. Therefore, the president’s appointment pursuant to the 2nd and 3rd sentences
need no confirmation." 6

The only issue to be resolved by the Court in the present case is whether or not Congress may, by law, require
confirmation by the Commission on Appointments of appointments extended by the President to government officers
additional to those expressly mentioned in the first sentence of Sec. 16, Art. VII of the Constitution whose appointments
require confirmation by the Commission on Appointments.chanrobles virtualawlibrary chanrobles.com:chanrobles.com.ph

To resolve the issue, we go back to Mison where the Court stated:jgc:chanrobles.com.ph

". . . there are four (4) groups of officers whom the President shall appoint. These four (4) groups, to which we will
hereafter refer from time to time, are:chanrob1es virtual 1aw library

‘First, the heads of the executive departments, ambassadors, other public ministers and consuls, officers of the armed
forces from the rank of colonel or naval captain, and other officers whose appointments are vested in him in this
Constitution;

‘Second, all other officers of the Government whose appointments are not otherwise provided for by law;

‘Third, those whom the President may be authorized by law to appoint;

‘Fourth, officers lower in rank whose appointments the Congress may by law vest in the President alone.’" 7

Mison also opined:jgc:chanrobles.com.ph

"In the course of the debates on the text of Section 16, there were two (2) major changes proposed and approved by the
Commission. These were (1) the exclusion of the appointments of heads of bureaus from the requirement of confirmation
by the Commission on Appointments; and (2) the exclusion of appointments made under the second sentence of the
section from the same requirement . . ."cralaw virtua1aw library

The second sentence of Sec. 16, Art. VII refers to all other officers of the government whose appointment are not
otherwise provided for by law and those whom the President may be authorized by law to appoint.

Indubitably, the NLRC Chairman and Commissioners fall within the second sentence of Section 16, Article VII of the
Constitution, more specifically under the "third groups" of appointees referred to in Mison, i.e. those whom the President
may be authorized by law to appoint. Undeniably, the Chairman and Members of the NLRC are not among the officers
mentioned in the first sentence of Section 16, Article VII whose appointments requires confirmation by the Commission on
Appointments. To the extent that RA 6715 requires confirmation by the Commission on Appointments of the appointments
of respondents Chairman and Members of the National Labor Relations Commission, it is unconstitutional
because:chanrob1es virtual 1aw library

1) it amends by legislation, the first sentence of Sec. 16, Art. VII of the Constitution by adding thereto appointments
requiring confirmation by the Commission on Appointments; and

2) it amends by legislation the second sentence of Sec. 16, Art. VII of the Constitution, by imposing the confirmation of the
Commission on Appointments on appointments which are otherwise entrusted only with the President.

Deciding on what law to pass is a legislative prerogative. Determining their constitutionality is a judicial function. The Court
respects the laudable intention of the legislature. Regretfully, however, the constitutional infirmity of Sec. 13 of RA 6715
amending Art. 215 of the Labor Code, insofar as it requires confirmation of the Commission on Appointments over
appointments of the Chairman and Members of the National Labor Relations Commission (NLRC) is, as we see it, beyond
redemption if we are to render fealty to the mandate of the Constitution in Sec. 16, Art. VII
thereof.chanroblesvirtualawlibrary

Supreme Court decisions applying or interpreting the Constitution shall form part of the legal system of the Philippines. 8
No doctrine or principle of law laid down by the Court in a decision rendered en banc or in division may be modified or
reversed except by the Court sitting en banc. 9

". . . The interpretation upon a law by this Court constitutes, in a way, a part of the law as of the date that law was
originally passed, since this Court’s construction merely establishes the contemporaneous legislative intent that the law
thus construed intends to effectuate. The settled rule supported by numerous authorities is a restatement of the legal
maxim ‘legis interpretado legis vim obtinent’ — the interpretation placed upon the written law by a competent court has the
force of law." 10

The rulings in Mison, Bautista and Quintos-Deles have interpreted Art. VII, Sec. 16 consistently in one manner. Can
legislation expand a constitutional provision after the Supreme Court has interpreted it?

In Endencia and Jugo v. David, 11 the Court held:jgc:chanrobles.com.ph

"By legislative fiat as enunciated in section 13, Republic Act No. 590, Congress says that taxing the salary of a judicial
officer is not a decrease of compensation. This is a clear example of interpretation or ascertainment of the meaning of the
phrase ‘which shall not be diminished during their continuance in office,’ found in section 9, Article VIII of the Constitution,
referring to the salaries of judicial officers."cralaw virtua1aw library

x x x

‘The rule is recognized elsewhere that the legislature cannot pass any declaratory act, or act declaratory of what the law
was before its passage, so as to give it any binding weight with the courts. A legislative definition of a word as used in a
statute is not conclusive of its meaning as used elsewhere; otherwise, the legislature would be usurping a judicial function
in defining a term. (11 Am. Jur., 914, Emphasis supplied).

‘The legislature cannot, upon passing law which violates a constitutional provision, validate it so as to prevent an attack
thereon in the courts, by a declaration that it shall be so construed as not to violate the constitutional inhibition.’ (11 Am.,
Jur., 919, Emphasis supplied).

"We have already said that the Legislature under our form of government is assigned the task and the power to make and
enact laws, but not to interpret them. This is more true with regard to the interpretation of the basic law, the Constitution,
which is not within the sphere of the Legislative department. If the Legislature may declare what a law means, or what a
specific portion of the Constitution means, especially after the courts have in actual case ascertained its meaning by
interpretation and applied it in a decision, this would surely cause confusion and instability in judicial processes and court
decision. Under such a system, a final court determination of a case based on a judicial interpretation of the law or of the
Constitution may be undermined or even annulled by a subsequent and different interpretation of the law or of the
Constitution by the Legislative department. That would be neither wise nor desirable, besides being clearly violative of the
fundamental principles of our constitutional system of government, particularly those governing the separation of powers."
12 (Emphasis supplied)

Congress, of course, must interpret the Constitution, must estimate the scope of its constitutional powers when it sets out
to enact legislation and it must take into account the relevant constitutional prohibitions. 13

". . . The Constitution did not change with public opinion.

It is not only the same words, but the same in meaning . . . and as long as it speaks not only in the same words, but with
the same meaning and intent with which it spoke when it came from the hands of its framers, and was voted and adopted
by the people . . ." 14

The function of the Court in passing upon an act of Congress is to "lay the article of the Constitution which is invoked
beside the statute which is challenged and to decide whether the latter squares with the former" and to "announce its
considered judgment upon the question." 15

It can not be overlooked that Sec. 16, Art. VII of the 1987 Constitution was deliberately, not unconsciously, intended by
the framers of the 1987 Constitution to be a departure from the system embodied in the 1935 Constitution where the
Commission on Appointments exercised the power of confirmation over almost all presidential appointments, leading to
may cases of abuse of such power of confirmation. Subsection 3, Section 10, Art. VII of the 1935 Constitution
provided:jgc:chanrobles.com.ph

"3. The President shall nominate and with the consent of the Commission on Appointments, shall appoint the heads of the
executive departments and bureau, officers of the Army from the rank of the colonel, of the Navy and Air Forces from the
rank of captain or commander, and all other officers of the Government whose appointments are not herein otherwise
provided for, and those whom he may be authorized by law to appoint; . . ."cralaw virtua1aw library

The deliberate limitation on the power of confirmation of the Commission on Appointments over presidential
appointments, embodied in Sec. 16, Art. VII of the 1987 Constitution, has undoubtedly evoked the displeasure and
disapproval of members of the Congress. The solution to the apparent problem, if indeed a problem, is not judicial or
legislative but constitutional. A future constitutional convention or Congress sitting as a constituent (constitutional)
assembly may then consider either a return to the 1935 Constitutional provisions or the adoption of a hybrid system
between the 1935 and 1987 constitutional provisions. Until then, it is the duty of the Court to apply the 1987 Constitution
in accordance with what it says and not in accordance with how the legislature or the executive would want it interpreted.
WHEREFORE, the petition is DISMISSED. Art. 215 of the Labor Code as amended by RA 6715 insofar as it requires the
confirmation of the Commission on Appointments of appointments of the Chairman and Members of the National Labor
Relations Commission (NLRC) is hereby declared unconstitutional and of no legal force and effect.

SO ORDERED.

Narvasa, C.J., Melencio-Herrera, Paras, Feliciano, Bidin, Griño-Aquino, Medialdea, Regalado, Davide, Jr., Romero and
Nocon, JJ., concur.

Bellosillo, J., took no part.

Separate Opinions

GUTIERREZ, JR., J., concurring:chanrob1es virtual 1aw library

When the issues in this petition were first raised in Sarmiento III v. Mison (156 SCRA 549 [1987]), I joined Justice Cruz in
a dissent because I felt that the interpretation of Section 16, Article VII by the majority of the Court results in absurd or
irrational consequences. The framers could not have intended what the majority ruled to be the meaning of the provision.
When the question was again raised in Bautista v. Salonga (172 SCRA 160 [1989]), I reiterated my dissent and urged a
re-examination of the doctrine stated in Sarmiento v. Mison.chanrobles virtual lawlibrary

The issue is again before us. Even as I continue to believe that the majority was wrong in the Sarmiento and Bautista
cases, I think it is time to finally accept the majority opinion as the Court’s ruling on the matter and one which everybody
should respect. There will be no end to litigation if, everytime a high government official is appointed without confirmation
by the Commission on Appointments, another petition is filed with this Court.

I, therefore, VOTE with the majority to DISMISS the PETITION.

CRUZ, J., dissenting:chanrob1es virtual 1aw library

I dissent on the basis of my dissent in Sarmiento v. Mison, which I believe should be re-examined instead of being
automatically re-affirmed simply because of its original adoption. I do not believe we should persist in error on the ground
merely of adherence to judicial precedent, however unsound.

Endnotes:

1. Sec. 16, Art. VII, 1987 Constitution.

2. G.R. No. 79974, 17 December 1987, 156 SCRA 549.

3. G.R. No. 86439, 13 April 1989, 172 SCRA 160.

4. G.R. No. 83216, 4 September 1989, 177 SCRA 259, 260.

5. Rollo, pp. 10-11.

6. Memorandum for respondents, Rollo, p. 8.

7. Supra at pp. 553-554.

8. Art. 8, New Civil Code of the Philippines.

9. Art. VIII, Sec. 4(3), 1987 Constitution.

10. People v. Jabinal, G.R. No. L-30061, 27 February 1974, 55 SCRA 607.

11. G.R. Nos. L-6355-56, 31 August 1953, 93 Phil. 699.

12. Ibid., pp. 701-702.

13. Swisher, Carl Brent, The Supreme Court in Modern Role, NYU Press, Inc., 1958, pp. 34-35.

14. Ibid., former Chief Justice Taney in Dred Scott v. Sandford, 19 Howard 393, 407, (1857), p. 147.

15. Ibid., Justice Roberts in United States v. Butler, 297 U.S. I, 62-63 (1936), p. 170.
9. Pepsi Cola Distributors of the Phils. Inc., v. Hon. Gallang, G.R. 89621, 24 September 1991
[G.R. No. 89621. September 24, 1991.]

PEPSI COLA DISTRIBUTORS OF THE PHILIPPINES, INC., represented by its Plant General Manager ANTHONY B.
SIAN, ELEAZAR LIMBAB, IRENEO BALTAZAR & JORGE HERAYA, Petitioners, v. HON. LOLITA O. GAL-LANG,
SALVADOR NOVILLA, ALEJANDRO OLIVA, WILFREDO CABAÑAS & FULGENCIO LEGO, Respondents.

Aurelio D. Menzon, for Petitioners.

Mario P. Nicolasora co-counsel, for Petitioners.

Papiano L. Santo for Private Respondents.

SYLLABUS

1. LABOR AND SOCIAL LEGISLATION; LABOR ARBITER; SCOPE OF POWER; RULE. — It must be stressed that not
every controversy involving workers and their employers can be resolved only by the labor arbiters. This will be so only if
there is a "reasonable causal connection" between the claim asserted and employee-employer relations to put the case
under the provisions of Article 217. Absent such a link, the complaint will be cognizable by the regular courts of justice in
the exercise of their civil and criminal jurisdiction.

2. REMEDIAL LAW; CIVIL PROCEDURE; COMPLAINT FOR DAMAGE FOR MALICIOUS PROSECUTION FILED BY
EMPLOYEES AGAINST EMPLOYERS; COGNIZABLE BY REGULAR COURTS OF JUSTICE; CASE AT BAR. — The
case now before the Court involves a complaint for damages for malicious prosecution which was filed with the Regional
Trial Court of Leyte by the employees of the defendant company. It does not appear that there is a "reasonable causal
connection" between the complaint and the relations of the parties as employer and employees. The complaint did not
arise from such relations and in fact could have arisen independently of an employment relationship between the parties.
No such relationship or any unfair labor practice is asserted. What the employees are alleging is that the petitioners acted
with bad faith when they filed the criminal complaint which the Municipal Trial Court said was intended "to harass the poor
employee" and the dismissal of which was affirmed by the Provincial Prosecutor "for lack of evidence to establish even a
slightest probability that all the respondents herein have committed the crime imputed against them." This is a matter
which the labor arbiter has no competence to resolve as the applicable law is not the Labor Code but the Revised Penal
Code.

DECISION

CRUZ, J.:

The question now before us has been categorically resolved in earlier decisions of the Court that a little more diligent
research would have disclosed to the petitioners. On the basis of those cases and the facts now before us, the petition
must be denied.chanrobles.com.ph : virtual law library

The private respondents were employees of the petitioner who were suspected of complicity in the irregular disposition of
empty Pepsi Cola bottles. On July 16, 1987, the petitioners filed a criminal complaint for theft against them but this was
later withdrawn and substituted with a criminal complaint for falsification of private documents. On November 26, 1987,
after a preliminary investigation conducted by the Municipal Trial Court of Tanauan, Leyte, the complaint was dismissed.
The dismissal was affirmed on April 8, 1988, by the Office of the Provincial Prosecutor.

Meantime, allegedly after an administrative investigation, the private respondents were dismissed by the petitioner
company on November 23, 1987. As a result, they lodged a complaint for illegal dismissal with the Regional Arbitration
Branch of the NLRC in Tacloban City on December 1, 1987, and demanded reinstatement with damages. In addition, they
instituted in the Regional Trial Court of Leyte, on April 1988, a separate civil complaint against the petitioners for damages
arising from what they claimed to be their malicious prosecution.

The petitioners moved to dismiss the civil complaint on the ground that the trial court had no jurisdiction over the case
because it involved employee-employer relations that were exclusively cognizable by the labor arbiter. The motion was
granted on February 6, 1989. On July 6, 1989, however, the respondent judge, acting on the motion for reconsideration,
reinstated the complaint, saying it was "distinct from the labor case for damages now pending before the labor courts."
The petitioners then came to this Court for relief.

The petitioners invoke Article 217 of the Labor Code and a number of decisions of this Court to support their position that
the private respondents’ civil complaint for damages falls under the jurisdiction of the labor arbiter. They particularly cite
the case of Getz Corporation v. Court of Appeals, 1 where it was held that a court of first instance had no jurisdiction over
the complaint filed by a dismissed employee "for unpaid salary and other employment benefits, termination pay and moral
and exemplary damages."cralaw virtua1aw library

We hold at the outset that the case is not in point because what was involved there was a claim arising from the alleged
illegal dismissal of an employee, who chose to complain to the regular court and not to the labor arbiter. Obviously, the
claim arose from employee-employer relations and so came under Article 217 of the Labor Code which then provided as
follows:chanrob1es virtual 1aw library
ART. 217. Jurisdiction of Labor Arbiters and the Commission. — (a) The Labor Arbiters shall have the original and
exclusive jurisdiction to hear and decide within thirty (30) working days after submission of the case by the parties for
decision, the following cases involving all workers, whether agricultural or non-agricultural:chanrob1es virtual 1aw library

1. Unfair labor practice cases;

2. Those that workers may file involving wages, hours of work and other terms and conditions of employment;

3. All money claims of workers, including those based on non-payment or underpayment of wages, overtime
compensation, separation pay and other benefits provided by law or appropriate agreement, except claims for employees’
compensation, social security, medicare and maternity benefits;

4. Cases involving household services; and

5. Cases arising from any violation of Article 265 of this Code, including questions involving the legality of strikes and
lockouts.

(b) The Commission shall have exclusive appellate jurisdiction over all cases decided by Labor Arbiters. 2

It must be stressed that not every controversy involving workers and their employers can be resolved only by the labor
arbiters. This will be so only if there is a "reasonable causal connection" between the claim asserted and employee-
employer relations to put the case under the provisions of Article 217. Absent such a link, the complaint will be cognizable
by the regular courts of justice in the exercise of their civil and criminal jurisdiction.

In Medina v. Castro-Bartolome, 3 two employees filed in the Court of First Instance of Rizal a civil complaint for damages
against their employer for slanderous remarks made against them by the company president. On the order dismissing the
case because it came under the jurisdiction of the labor arbiters, Justice Vicente Abad Santos said for the
Court:chanrob1es virtual 1aw library

It is obvious from the complaint that the plaintiffs have not alleged any unfair labor practice. Theirs is a simple action for
damages for tortuous acts allegedly committed by the defendants. Such being the case, the governing statute is the Civil
Code and not the Labor Code. It results that the orders under review are based on a wrong premise.chanrobles.com.ph :
virtual law library

In Singapore Airlines Ltd. v. Paño, 4 where the plaintiff was suing for damages for alleged violation by the defendant of an
"Agreement for a Course of Conversion Training at the Expense of Singapore Airlines Limited," the jurisdiction of the
Court of First Instance of Rizal over the case was questioned. The Court, citing the earlier case of Quisaba v. Sta. Ines
Melale Veneer and Plywood, Inc., 5 declared through Justice Herrera:chanrob1es virtual 1aw library

Stated differently, petitioner seeks protection under the civil laws and claims no benefits under the Labor Code. The
primary relief sought is for liquidated damages for breach of a contractual obligation. The other items demanded are not
labor benefits demanded by workers generally taken cognizance of in labor disputes, such as payment of wages, overtime
compensation or separation pay. The items claimed are the natural consequences flowing from breach of an obligation,
intrinsically a civil dispute.

In Molave Sales, Inc. v. Laron, 6 the same Justice held for the Court that the claim of the plaintiff against its sales
manager for payment of certain accounts pertaining to his purchase of vehicles and automotive parts, repairs of such
vehicles, and cash advances from the corporation was properly cognizable by the Regional Trial Court of Dagupan City
and not the labor arbiter, because "although a controversy is between an employer and an employee, the Labor Arbiters
have no jurisdiction if the Labor Code is not involved."cralaw virtua1aw library

The latest ruling on this issue is found in San Miguel Corporation v. NLRC, 7 where the above cases are cited and the
changes in Article 217 are recounted. That case involved a claim of an employee for a P60,000.00 prize for a proposal
made by him which he alleged had been accepted and implemented by the defendant corporation in the processing of
one of its beer products. The claim was filed with the labor arbiter, who dismissed it for lack of jurisdiction but was
reversed by the NLRC on appeal. In setting aside the appealed decision and dismissing the complaint, the Court
observed through Justice Feliciano:chanrob1es virtual 1aw library

It is the character of the principal relief sought that appears essential, in this connection. Where such principal relief is to
be granted under labor legislation or a collective bargaining agreement, the case should fall within the jurisdiction of the
Labor Arbiter and the NLRC, even though a claim for damages might be asserted as an incident to such claim.

x x x

Where the claim to the principal relief sought is to be resolved not by reference to the Labor Code or other labor relations
statute or a collective bargaining agreement but by the general civil law, the jurisdiction over the dispute belongs to the
regular courts of justice and not to the Labor Arbiter and the NLRC. In such situations, resolution of the dispute requires
expertise, not in labor management relations nor in wage structures and other terms and conditions of employment, but
rather in the application of the general civil law. Clearly, such claims fall outside the area of competence or expertise
ordinarily ascribed to Labor Arbiters and the NLRC and the rationale for granting jurisdiction over such claims to these
agencies disappears.

x x x
While paragraph 3 above refers to "all money claims of workers," it is not necessary to suppose that the entire universe of
money claims that might be asserted by workers against their employers has been absorbed into the original and
exclusive jurisdiction of Labor Arbiters.

x x x

For it cannot be presumed that money claims of workers which do not arise out of or in connection with their employer-
employee relationship, and which would therefore fall within the general jurisdiction of the regular courts of justice, were
intended by the legislative authority to be taken away from the jurisdiction of the courts and lodged with Labor Arbiters on
an exclusive basis. The Court, therefore, believes and so holds that the "money claims of workers" referred to in
paragraph 3 of Article 217 embraces money claims which arise out of or in connection with the employer-employee
relationship, or some aspect or incident of such relationship. Put a little differently, that money claims of workers which
now fall within the original and exclusive jurisdiction of Labor Arbiters are those money claims which have some
reasonable causal connection with the employer-employee relationship (Ibid.).

The case now before the Court involves a complaint for damages for malicious prosecution which was filed with the
Regional Trial Court of Leyte by the employees of the defendant company. It does not appear that there is a "reasonable
causal connection" between the complaint and the relations of the parties as employer and employees. The complaint did
not arise from such relations and in fact could have arisen independently of an employment relationship between the
parties. No such relationship or any unfair labor practice is asserted. What the employees are alleging is that the
petitioners acted with bad faith when they filed the criminal complaint which the Municipal Trial Court said was intended
"to harass the poor employees" and the dismissal of which was affirmed by the Provincial Prosecutor "for lack of evidence
to establish even a slightest probability that all the respondents herein have committed the crime imputed against them."
This is a matter which the labor arbiter has no competence to resolve as the applicable law is not the Labor Code but the
Revised Penal Code.chanrobles lawlibrary : rednad

"Talents differ, all is well and wisely put," so observed the philosopher-poet. 8 So it must be in the case we here decide.

WHEREFORE, the order dated July 6, 1989, is AFFIRMED and the petition DENIED, with costs against the petitioner.

SO ORDERED.
10. Santiago v. CF Sharp Crew Management Inc, G.R. No. 162419 10 July 2007
G.R. No. 162419 July 10, 2007

PAUL V. SANTIAGO, petitioner,

vs.
CF SHARP CREW MANAGEMENT, INC., respondent.

DECISION

TINGA, J.:

At the heart of this case involving a contract between a seafarer, on one hand, and the manning agent and the foreign
principal, on the other, is this erstwhile unsettled legal quandary: whether the seafarer, who was prevented from leaving
the port of Manila and refused deployment without valid reason but whose POEA-approved employment contract provides
that the employer-employee relationship shall commence only upon the seafarer’s actual departure from the port in the
point of hire, is entitled to relief?

This treats of the petition for review filed by Paul V. Santiago (petitioner) assailing the Decision and Resolution of the
Court of Appeals dated 16 October 2003 and 19 February 2004, respectively, in CA-G.R. SP No. 68404.1

Petitioner had been working as a seafarer for Smith Bell Management, Inc. (respondent) for about five (5) years.2 On 3
February 1998, petitioner signed a new contract of employment with respondent, with the duration of nine (9) months. He
was assured of a monthly salary of US$515.00, overtime pay and other benefits. The following day or on 4 February
1998, the contract was approved by the Philippine Overseas Employment Administration (POEA). Petitioner was to be
deployed on board the "MSV Seaspread" which was scheduled to leave the port of Manila for Canada on 13 February
1998.

A week before the scheduled date of departure, Capt. Pacifico Fernandez, respondent’s Vice President, sent a facsimile
message to the captain of "MSV Seaspread," which reads:

I received a phone call today from the wife of Paul Santiago in Masbate asking me not to send her husband to MSV
Seaspread anymore. Other callers who did not reveal their identity gave me some feedbacks that Paul Santiago this time
if allowed to depart will jump ship in Canada like his brother Christopher Santiago, O/S who jumped ship from the C.S.
Nexus in Kita-kyushu, Japan last December, 1997.

We do not want this to happen again and have the vessel penalized like the C.S. Nexus in Japan.

Forewarned is forearmed like his brother when his brother when he was applying he behaved like a Saint but in his heart
he was a serpent. If you agree with me then we will send his replacement.

Kindly advise.3

To this message the captain of "MSV Seaspread" replied:

Many thanks for your advice concerning P. Santiago, A/B. Please cancel plans for him to return to Seaspread.4

On 9 February 1998, petitioner was thus told that he would not be leaving for Canada anymore, but he was reassured that
he might be considered for deployment at some future date.

Petitioner filed a complaint for illegal dismissal, damages, and attorney's fees against respondent and its foreign principal,
Cable and Wireless (Marine) Ltd.5 The case was raffled to Labor Arbiter Teresita Castillon-Lora, who ruled that the
employment contract remained valid but had not commenced since petitioner was not deployed. According to her,
respondent violated the rules and regulations governing overseas employment when it did not deploy petitioner, causing
petitioner to suffer actual damages representing lost salary income for nine (9) months and fixed overtime fee, all
amounting to US$7, 209.00.

The labor arbiter held respondent liable. The dispositive portion of her Decision dated 29 January 1999 reads:

WHEREFORE, premises considered, respondent is hereby Ordered to pay complainant actual damages in the amount of
US$7,209.00 plus 10% attorney's fees, payable in Philippine peso at the rate of exchange prevailing at the time of
payment.

All the other claims are hereby DISMISSED for lack of merit.

SO ORDERED.6

On appeal by respondent, the National Labor Relations Commission (NLRC) ruled that there is no employer-employee
relationship between petitioner and respondent because under the Standard Terms and Conditions Governing the
Employment of Filipino Seafarers on Board Ocean Going Vessels (POEA Standard Contract), the employment contract
shall commence upon actual departure of the seafarer from the airport or seaport at the point of hire and with a POEA-
approved contract. In the absence of an employer-employee relationship between the parties, the claims for illegal
dismissal, actual damages, and attorney’s fees should be dismissed.7 On the other hand, the NLRC found respondent’s
decision not to deploy petitioner to be a valid exercise of its management prerogative.8 The NLRC disposed of the appeal
in this wise:
WHEREFORE, in the light of the foregoing, the assailed Decision dated January 29, 1999 is hereby AFFIRMED in so far
as other claims are concerned and with MODIFICATION by VACATING the award of actual damages and attorney’s fees
as well as excluding Pacifico Fernandez as party respondent.

SO ORDERED.9

Petitioner moved for the reconsideration of the NLRC’s Decision but his motion was denied for lack of merit.10 He
elevated the case to the Court of Appeals through a petition for certiorari.

In its Decision11 dated 16 October 2003, the Court of Appeals noted that there is an ambiguity in the NLRC’s Decision
when it affirmed with modification the labor arbiter’s Decision, because by the very modification introduced by the
Commission (vacating the award of actual damages and attorney’s fees), there is nothing more left in the labor arbiter’s
Decision to affirm.12

According to the appellate court, petitioner is not entitled to actual damages because damages are not recoverable by a
worker who was not deployed by his agency within the period prescribed in

the POEA Rules.13 It agreed with the NLRC’s finding that petitioner’s non-deployment was a valid exercise of
respondent’s management prerogative.14 It added that since petitioner had not departed from the Port of Manila, no
employer-employee relationship between the parties arose and any claim for damages against the so-called employer
could have no leg to stand on.15

Petitioner’s subsequent motion for reconsideration was denied on 19 February 2004.16

The present petition is anchored on two grounds, to wit:

A. The Honorable Court of Appeals committed a serious error of law when it ignored [S]ection 10 of Republic Act [R.A.]
No. 8042 otherwise known as the Migrant Worker’s Act of 1995 as well as Section 29 of the Standard Terms and
Conditions Governing the Employment of Filipino Seafarers On-Board Ocean-Going Vessels (which is deemed
incorporated under the petitioner’s POEA approved Employment Contract) that the claims or disputes of the Overseas
Filipino Worker by virtue of a contract fall within the jurisdiction of the Labor Arbiter of the NLRC.

B. The Honorable Court of Appeals committed a serious error when it disregarded the required quantum of proof in labor
cases, which is substantial evidence, thus a total departure from established jurisprudence on the matter.17

Petitioner maintains that respondent violated the Migrant Workers Act and the POEA Rules when it failed to deploy him
within thirty (30) calendar days without a valid reason. In doing so, it had unilaterally and arbitrarily prevented the
consummation of the POEA- approved contract. Since it prevented his deployment without valid basis, said deployment
being a condition to the consummation of the POEA contract, the contract is deemed consummated, and therefore he
should be awarded actual damages, consisting of the stipulated salary and fixed overtime pay.18 Petitioner adds that
since the contract is deemed consummated, he should be considered an employee for all intents and purposes, and thus
the labor arbiter and/or the NLRC has jurisdiction to take cognizance of his claims.19

Petitioner additionally claims that he should be considered a regular employee, having worked for five (5) years on board
the same vessel owned by the same principal and manned by the same local agent. He argues that respondent’s act of
not deploying him was a scheme designed to prevent him from attaining the status of a regular employee.20

Petitioner submits that respondent had no valid and sufficient cause to abandon the employment contract, as it merely
relied upon alleged phone calls from his wife and other unnamed callers in arriving at the conclusion that he would jump
ship like his brother. He points out that his wife had executed an affidavit21 strongly denying having called respondent,
and that the other alleged callers did not even disclose their identities to respondent.22 Thus, it was error for the Court of
Appeals to adopt the unfounded conclusion of the NLRC, as the same was not based on substantial evidence.23

On the other hand, respondent argues that the Labor Arbiter has no jurisdiction to award petitioner’s monetary claims. His
employment with respondent did not commence because his deployment was withheld for a valid reason. Consequently,
the labor arbiter and/or the NLRC cannot entertain adjudication of petitioner’s case much less award damages to him. The
controversy involves a breach of contractual obligations and as such is cognizable by civil courts.24 On another matter,
respondent claims that the second issue posed by petitioner involves a recalibration of facts which is outside the
jurisdiction of this Court.25

There is some merit in the petition.

There is no question that the parties entered into an employment contract on 3 February 1998, whereby petitioner was
contracted by respondent to render services on board "MSV Seaspread" for the consideration of US$515.00 per month for
nine (9) months, plus overtime pay. However, respondent failed to deploy petitioner from the port of Manila to Canada.
Considering that petitioner was not able to depart from the airport or seaport in the point of hire, the employment contract
did not commence, and no employer-employee relationship was created between the parties.26

However, a distinction must be made between the perfection of the employment contract and the commencement of the
employer-employee relationship. The perfection of the contract, which in this case coincided with the date of execution
thereof, occurred when petitioner and respondent agreed on the object and the cause, as well as the rest of the terms and
conditions therein. The commencement of the employer-employee relationship, as earlier discussed, would have taken
place had petitioner been actually deployed from the point of hire. Thus, even before the start of any employer-employee
relationship, contemporaneous with the perfection of the employment contract was the birth of certain rights and
obligations, the breach of which may give rise to a cause of action against the erring party. Thus, if the reverse had
happened, that is the seafarer failed or refused to be deployed as agreed upon, he would be liable for damages.
Moreover, while the POEA Standard Contract must be recognized and respected, neither the manning agent nor the
employer can simply prevent a seafarer from being deployed without a valid reason.

Respondent’s act of preventing petitioner from departing the port of Manila and boarding "MSV Seaspread" constitutes a
breach of contract, giving rise to petitioner’s cause of action. Respondent unilaterally and unreasonably reneged on its
obligation to deploy petitioner and must therefore answer for the actual damages he suffered.

We take exception to the Court of Appeals’ conclusion that damages are not recoverable by a worker who was not
deployed by his agency. The fact that the POEA Rules27 are silent as to the payment of damages to the affected seafarer
does not mean that the seafarer is precluded from claiming the same. The sanctions provided for non-deployment do not
end with the suspension or cancellation of license or fine and the return of all documents at no cost to the worker. They do
not forfend a seafarer from instituting an action for damages against the employer or agency which has failed to deploy
him.

The POEA Rules only provide sanctions which the POEA can impose on erring agencies. It does not provide for damages
and money claims recoverable by aggrieved employees because it is not the POEA, but the NLRC, which has jurisdiction
over such matters.

Despite the absence of an employer-employee relationship between petitioner and respondent, the Court rules that the
NLRC has jurisdiction over petitioner’s complaint. The jurisdiction of labor arbiters is not limited to claims arising from
employer-employee relationships. Section 10 of R.A. No. 8042 (Migrant Workers Act), provides that:

Sec. 10. Money Claims. – Notwithstanding any provision of law to the contrary, the Labor Arbiters of the National Labor
Relations Commission (NLRC) shall have the original and exclusive jurisdiction to hear and decide, within ninety (90)
calendar days after the filing of the complaint, the claims arising out of an employer-employee relationship or by virtue of
any law or contract involving Filipino workers for overseas deployment including claims for actual, moral, exemplary and
other forms of damages. x x x [Emphasis supplied]

Since the present petition involves the employment contract entered into by petitioner for overseas employment, his
claims are cognizable by the labor arbiters of the NLRC.

Article 2199 of the Civil Code provides that one is entitled to an adequate compensation only for such pecuniary loss
suffered by him as he has duly proved. Respondent is thus liable to pay petitioner actual damages in the form of the loss
of nine (9) months’ worth of salary as provided in the contract. He is not, however, entitled to overtime pay. While the
contract indicated a fixed overtime pay, it is not a guarantee that he would receive said amount regardless of whether or
not he rendered overtime work. Even though petitioner was "prevented without valid reason from rendering regular much
less overtime service,"28 the fact remains that there is no certainty that petitioner will perform overtime work had he been
allowed to board the vessel. The amount of US$286.00 stipulated in the contract will be paid only if and when the
employee rendered overtime work. This has been the tenor of our rulings in the case of Stolt-Nielsen Marine Services
(Phils.), Inc. v. National Labor Relations Commission29 where we discussed the matter in this light:

The contract provision means that the fixed overtime pay of 30% would be the basis for computing the overtime pay if and
when overtime work would be rendered. Simply stated, the rendition of overtime work and the submission of sufficient
proof that said work was actually performed are conditions to be satisfied before a seaman could be entitled to overtime
pay which should be computed on the basis of 30% of the basic monthly salary. In short, the contract provision
guarantees the right to overtime pay but the entitlement to such benefit must first be established. Realistically speaking, a
seaman, by the very nature of his job, stays on board a ship or vessel beyond the regular eight-hour work schedule. For
the employer to give him overtime pay for the extra hours when he might be sleeping or attending to his personal chores
or even just lulling away his time would be extremely unfair and unreasonable.30

The Court also holds that petitioner is entitled to attorney’s fees in the concept of damages and expenses of litigation.
Attorney's fees are recoverable when the defendant's act or omission has compelled the plaintiff to incur expenses to
protect his interest.31 We note that respondent’s basis for not deploying petitioner is the belief that he will jump ship just
like his brother, a mere suspicion that is based on alleged phone calls of several persons whose identities were not even
confirmed. Time and again, this Court has upheld management prerogatives so long as they are exercised in good faith
for the advancement of the employer’s interest and not for the purpose of defeating or circumventing the rights of the
employees under special laws or under valid agreements.32 Respondent’s failure to deploy petitioner is unfounded and
unreasonable, forcing petitioner to institute the suit below. The award of attorney’s fees is thus warranted.

However, moral damages cannot be awarded in this case. While respondent’s failure to deploy petitioner seems baseless
and unreasonable, we cannot qualify such action as being tainted with bad faith, or done deliberately to defeat petitioner’s
rights, as to justify the award of moral damages. At most, respondent was being overzealous in protecting its interest
when it became too hasty in making its conclusion that petitioner will jump ship like his brother.

We likewise do not see respondent’s failure to deploy petitioner as an act designed to prevent the latter from attaining the
status of a regular employee. Even if petitioner was able to depart the port of Manila, he still cannot be considered a
regular employee, regardless of his previous contracts of employment with respondent. In Millares v. National Labor
Relations Commission,33 the Court ruled that seafarers are considered contractual employees and cannot be considered
as regular employees under the Labor Code. Their employment is governed by the contracts they sign every time they are
rehired and their employment is terminated when the contract expires. The exigencies of their work necessitates that they
be employed on a contractual basis.34

WHEREFORE, petition is GRANTED IN PART. The Decision dated 16 October 2003 and the Resolution dated 19
February 2004 of the Court of Appeals are REVERSED and SET ASIDE. The Decision of Labor Arbiter Teresita D.
Castillon-Lora dated 29 January 1999 is REINSTATED with the MODIFICATION that respondent CF Sharp Crew
Management, Inc. is ordered to pay actual or compensatory damages in the amount of US$4,635.00
representing salary for nine (9) months as stated in the contract, and attorney’s fees at the reasonable rate of 10% of the
recoverable amount.

SO ORDERED.
11. Bright Maritime Corp. v. Fantonial, G.R. 165935, 8 February 2012
G.R. No. 165935 February 8, 2012

BRIGHT MARITIME CORPORATION (BMC)/DESIREE P. TENORIO, Petitioners,

vs.
RICARDO B. FANTONIAL, Respondent.

DECISION

PERALTA, J.:

This is a petition for review on certiorari1 of the Decision of the Court of Appeals in CA-G.R. SP No. 67571, dated October
25, 2004, reversing and setting aside the Decision of the National Labor Relations Commission (NLRC), and reinstating
the Decision of the Labor Arbiter finding that respondent Ricardo B. Fantonial was illegally dismissed, but the Court of
Appeals modified the award of damages.

The facts are as follows:

On January 15, 2000, a Contract of Employment2 was executed by petitioner Bright Maritime Corporation (BMC), a
manning agent, and its president, petitioner Desiree P. Tenorio, for and in behalf of their principal, Ranger Marine S.A.,
and respondent Ricardo B. Fantonial, which contract was verified and approved by the Philippine Overseas Employment
Administration (POEA) on January 17, 2000. The employment contract provided that respondent shall be employed as
boatswain of the foreign vessel M/V AUK for one year, with a basic monthly salary of US$450, plus an allowance of
US$220. The contract also provided for a 90 hours per month of overtime with pay and a vacation leave with pay of
US$45 per month.

Respondent was made to undergo a medical examination at the Christian Medical Clinic, which was petitioner’s
accredited medical clinic. Respondent was issued a Medical Certificate3 dated January 17, 2000, which certificate had the
phrase "FIT TO WORK" stamped on its lower and upper portion.

At about 3:30 p.m. of January 17, 2000, respondent, after having undergone the pre-departure orientation seminar and
being equipped with the necessary requirements and documents for travel, went to the Ninoy Aquino International Airport
upon instruction of petitioners. Petitioners told respondent that he would be departing on that day, and that a liaison officer
would be delivering his plane ticket to him. At about 4:00 p.m., petitioners’ liaison officer met respondent at the airport and
told him that he could not leave on that day due to some defects in his medical certificate. The liaison officer instructed
respondent to return to the Christian Medical Clinic.

Respondent went back to the Christian Medical Clinic the next day, and he was told by the examining physician, Dr. Lyn
dela Cruz-De Leon, that there was nothing wrong or irregular with his medical certificate.

Respondent went to petitioners’ office for an explanation, but he was merely told to wait for their call, as he was being
lined-up for a flight to the ship's next port of call. However, respondent never got a call from petitioners.

On May 16, 2000, respondent filed a complaint against petitioners for illegal dismissal, payment of salaries for the
unexpired portion of the employment contract and for the award of moral, exemplary, and actual damages as well as
attorney’s fees before the Regional Arbitration Branch No. 7 of the NLRC in Cebu City.4

In their Position Paper,5 petitioners stated that to comply with the standard requirements that only those who meet the
standards of medical fitness have to be sent on board the vessel, respondent was referred to their accredited medical
clinic, the Christian Medical Clinic, for pre-employment medical examination on January 17, 2000, the same day when
respondent was supposed to fly to Germany to join the vessel. Unfortunately, respondent was not declared fit to work on
January 17, 2000 due to some medical problems.

Petitioners submitted the Affidavit6 of Dr. Lyn dela Cruz-De Leon, stating that the said doctor examined respondent on
January 17, 2000; that physical and laboratory results were all within normal limits except for the finding, after chest x-ray,
of Borderline Heart Size, and that respondent was positive to Hepatitis B on screening; that respondent underwent ECG
to check if he had any heart problem, and the result showed left axis deviation. Dr. De Leon stated that she requested for
a Hepatitis profile, which was done on January 18, 2000; that on January 20, 2000, the result of the Hepatitis profile
showed non-infectious Hepatitis B. Further, Dr. De Leon stated that respondent was declared fit to work only on January
21, 2000; however, the date of the Medical Certificate was January 17, 2000, which was the date when she started to
examine the patient per standard operating procedure.

Petitioners argued that since respondent was declared fit to work only on January 21, 2000, he could not join the vessel
anymore as it had left the port in Germany. Respondent was advised to wait for the next vacancy for boatswain, but he
failed to report to petitioners’ office, and he gave them an incorrect telephone number. During the mandatory
conference/conciliation stage of this case, petitioners offered respondent to join one of their vessels, but he refused.

Petitioners further argued that they cannot be held liable for illegal dismissal as the contract of employment had not yet
commenced based on Section 2 of the Standard Terms and Conditions Governing the Employment of Filipino Seafarers
on Board Ocean-Going Vessels (POEA Memorandum Circular No. 055-96), which states:

SEC 2. COMMENCEMENT/DURATION OF CONTRACT

A. The employment contract between the employer and the seafarer shall commence upon actual departure of the
seafarer from the airport or seaport in the point of hire and with a POEA approved contract. It shall be effective until the
seafarer’s date of arrival at the point of hire upon termination of his employment pursuant to Section 18 of this Contract.
Petitioners asserted that since respondent was not yet declared fit to work on January 17, 2000, he was not able to leave
on the scheduled date of his flight to Germany to join the vessel. With his non-departure, the employment contract was
not commenced; hence, there is no illegal dismissal to speak of. Petitioners prayed for the dismissal of the complaint.

On September 25, 2000, Labor Arbiter Ernesto F. Carreon rendered a Decision7 in favor of respondent. The pertinent
portion of the decision reads:

Unarguably, the complainant and respondents have already executed a contract of employment which was duly approved
by the POEA. There is nothing left for the validity and enforceability of the contract except compliance with what are
agreed upon therein and to all their consequences. Under the contract of employment, the respondents are under
obligation to employ the complainant on board M/V AUK for twelve months with a monthly salary of 450 US$ and 220 US$
allowance. The respondents failed to present plausible reason why they have to desist from complying with their
obligation under the contract. The allegation of the respondents that the complainant was unfit to work is ludicrous. Firstly,
the respondents' accredited medical clinic had issued a medical certificate showing that the complainant was fit to work.
Secondly, if the complainant was not fit to work, a contract of employment would not have been executed and approved
by the POEA.

We are not also swayed by the argument of the respondents that since the complainant did not actually depart from
Manila his contract of employment can be withdrawn because he has not yet commenced his employment. The
commencement of the employment is not one of those requirements in order to make the contract of employment
consummated and enforceable between the parties, but only as a gauge for the payment of salary. In this case, while it is
true that the complainant is not yet entitled to the payment of wages because then his employment has not yet
commenced, nevertheless, the same did not relieve the respondents from fulfilling their obligation by unilaterally revoking
the contract as the same amounted to pre-termination of the contract without just or authorized cause perforce, we rule to
be constitutive of illegal dismissal.

Anent our finding of illegal dismissal, we condemn the respondent corporation to pay the complainant three (3) months
salary and the refund of his placement fee, including documentation and other actual expenses, which we fixed at one
month pay.

The granted claims are computed as follows:

US$670 x 4 months US$ 2,680.00

WHEREFORE, premises considered, judgment is hereby rendered ordering the respondent Bright Maritime Corporation
to pay the complainant Ricardo Fantonial the peso equivalent at the time of actual payment of US$ 2,680.00.

The other claims and the case against respondent Desiree P. Tenorio are dismissed for lack of merit.8

Petitioners appealed the decision of the Labor Arbiter to the NLRC.

On May 31, 2001, the NLRC, Fourth Division, rendered a Decision9 reversing the decision of the Labor Arbiter. The
dispositive portion of the NLRC decision reads:

WHEREFORE, premises considered, the decision of Labor Arbiter Ernesto F. Carreon, dated 25 September 2000, is SET
ASIDE and a new one is entered DISMISSING the complaint of the complainant for lack of merit.

SO ORDERED.10

The NLRC held that the affidavit of Dr. Lyn dela Cruz-De Leon proved that respondent was declared fit to work only on
January 21, 2000, when the vessel was no longer at the port of Germany. Hence, respondent’s failure to depart on
January 17, 2000 to join the vessel M/V AUK in Germany was due to respondent’s health. The NLRC stated that as a
recruitment agency, petitioner BMC has to protect its name and goodwill, so that it must ensure that an applicant for
employment abroad is both technically equipped and physically fit because a labor contract affects public interest.

Moreover, the NLRC stated that the Labor Arbiter’s decision ordering petitioners to refund respondent’s placement fee
and other actual expenses, which was fixed at one month pay in the amount of US$670.00, does not have any bases in
law, because in the deployment of seafarers, the manning agency does not ask the applicant for a placement fee. Hence,
respondent is not entitled to the said amount.

Respondent filed a motion for reconsideration of the NLRC decision, which motion was denied in a Resolution11 dated
July 23, 2001.

Respondent filed a petition for certiorari before the Court of Appeals, alleging that the NLRC committed grave abuse of
discretion in rendering the Decision dated May 31, 2001and the Resolution dated July 23, 2001.

On March 12, 2002, respondent’s counsel filed a Manifestation with Motion for Substitution of Parties due to the death of
respondent on November 15, 2001, which motion was granted by the Court of Appeals.

On October 25, 2004, the Court of Appeals rendered a Decision, the dispositive portion of which reads:

WHEREFORE, in view of the foregoing premises, judgment is hereby rendered by us REVERSING and SETTING ASIDE
the May 31, 2001 Decision and the July 23, 2001 Resolution of the NLRC, Fourth Division, and REINSTATING the
September 25, 2000 Decision of the Labor Arbiter with the modification that the placement fee and other expenses
equivalent to one (1) month salary is deleted and that the private respondent Bright Maritime Corporation must also pay
the amounts of ₱30,000.00 and ₱10,000.00 as moral and exemplary damages, respectively, to the petitioner.12
The Court of Appeals held that the NLRC, Fourth Division, acted with grave abuse of discretion in reversing the decision
of the Labor Arbiter who found that respondent was illegally dismissed. It agreed with the Labor Arbiter that the unilateral
revocation of the employment contract by petitioners amounted to pre-termination of the said contract without just or
authorized cause.

The Court of Appeals held that the contract of employment between petitioners and respondent had already been
perfected and even approved by the POEA. There was no valid and justifiable reason for petitioners to withhold the
departure of respondent on January 17, 2000. It found petitioners’ argument that respondent was not fit to work on the
said date as preposterous, since the medical certificate issued by petitioners’ accredited medical clinic showed that
respondent was already fit to work on the said date. The Court of Appeals stated, thus:

Private respondent's contention, which was contained in the affidavit of Dr. Lyn dela Cruz-De Leon, that the Hepatitis
profile was done only on January 18, 2000 and was concluded on January 20, 2000, is of dubious merit. For how could
the said examining doctor place in the medical certificate dated January 17, 2000 the words "CLASS-B NON-Infectious
Hepatitis" (Rollo, p. 17) if she had not conducted the hepatitis profile? Would the private respondent have us believe that
its accredited physician would fabricate medical findings?

It is obvious, therefore, that the petitioner had been fit to work on January 17, 2000 and he should have been able to leave
for Germany to meet with the vessel M/V AUK, had it not been for the unilateral act by private respondent of preventing
him from leaving. The private respondent was merely grasping at straws in attacking the medical condition of the
petitioner just so it can justify its act in preventing petitioner from leaving for abroad.13

The Court of Appeals held that petitioners’ act of preventing respondent from leaving for Germany was tainted with bad
faith, and that petitioners were also liable to respondent for moral and exemplary damages.

Thereafter, petitioners filed this petition raising the following issues:

WHETHER OR NOT THE HONORABLE APPELLATE COURT COMMITTED A SERIOUS ERROR AND GRAVE ABUSE
OF DISCRETION WHEN IT HELD THE PETITIONERS LIABLE FOR ILLEGALLY TERMINATING THE PRIVATE
RESPONDENT FROM HIS EMPLOYMENT.

II

WHETHER OR NOT THE HONORABLE APPELLATE COURT COMMITTED SERIOUS ERROR AND GRAVE ABUSE
OF DISCRETION IN SETTING ASIDE THE OVERWHELMING EVIDENCE SHOWING THAT THE PRIVATE
RESPONDENT FAILED TO COMPLY WITH THE REQUIREMENTS SET BY THE POEA RULES REGARDING FITNESS
FOR WORK.

III

WHETHER OR NOT THE HONORABLE APPELLATE COURT SERIOUSLY ERRED AND COMMITTED GRAVE ABUSE
OF DISCRETION WHEN IT AWARDED MONETARY BENEFITS TO THE PRIVATE RESPONDENT DESPITE THE
PROVISION OF THE POEA [STANDARD EMPLOYMENT CONTRACT] TO THE CONTRARY.

IV

WHETHER OR NOT THE HONORABLE APPELLATE COURT COMMITTED SERIOUS ERROR WITH REGARD TO ITS
FINDINGS OF FACTS, WHICH, IF NOT CORRECTED, WOULD CERTAINLY CAUSE GRAVE OR IRREPARABLE
DAMAGE OR INJURY TO THE PETITIONERS.14

The general rule that petitions for review only allow the review of errors of law by this Court is not ironclad.15 Where the
issue is shrouded by a conflict of factual perceptions by the lower court or the lower administrative body, such as the
NLRC in this case, this Court is constrained to review the factual findings of the Court of Appeals.16

Petitioners contend that the Court of Appeals erred in doubting the Affidavit of Dr. Lyn dela Cruz-De Leon, which affidavit
stated that the Hepatitis profile of respondent was done only on January 18, 2000 and was concluded on January 20,
2000. Petitioners stated that they had no intention to fabricate or mislead the appellate court and the Labor Arbiter, but
they had to explain the circumstances that transpired in the conduct of the medical examination. Petitioners reiterated that
the medical examination was conducted on January 17, 2000 and the result was released on January 20, 2000. As
explained by Dr. Lyn dela Cruz-De Leon, the date "January 17, 2000" was written on the medical examination certificate
because it was the day when respondent was referred and initially examined by her. The medical examination certificate
was dated January 17, 2000 not for any reason, but in accordance with a generally accepted medical practice, which was
not controverted by respondent.

Petitioners assert that respondent’s failure to join the vessel on January 17, 2000 should not be attributed to it for it was a
direct consequence of the delay in the release of the medical report. Respondent was not yet declared fit to work at the
time when he was supposed to be deployed on January 17, 2000, as instructed by petitioners’ principal. Respondent’s
fitness to work is a condition sine qua non for purposes of deploying an overseas contract worker. Since respondent failed
to qualify on the date designated by the principal for his deployment, petitioners had to find a qualified replacement
considering the nature of the shipping business where delay in the departure of the vessel is synonymous to
demurrage/damages on the part of the principal and on the vessel’s charterer. Without a clean bill of health, the contract
of employment cannot be considered to have been perfected as it is wanting of an important requisite.

Based on the foregoing argument of petitioners, the first issue to be resolved is whether petitioners’ reason for preventing
respondent from leaving Manila and joining the vessel M/V AUK in Germany on January 17, 2000 is valid.
The Court rules in the negative.

The Court has carefully reviewed the records of the case, and agrees with the Court of Appeals that respondent’s Medical
Certificate17 dated January 17, 2000, stamped with the words "FIT TO WORK," proves that respondent was medically fit
to leave Manila on January 17, 2000 to join the vessel M/V AUK in Germany. The Affidavit of Dr. Lyn dela Cruz-De Leon
that respondent was declared fit to work only on January 21, 2000 cannot overcome the evidence in the Medical
Certificate dated January 17, 2000, which already stated that respondent had "Class-B Non-Infectious Hepatitis-B," and
that he was fit to work. The explanation given by Dr. Lyn dela Cruz-De Leon in her affidavit that the Medical Certificate
was dated January 17, 2000, since it carries the date when they started to examine the patient per standard operating
procedure, does not persuade as it goes against logic and the chronological recording of medical procedures. The
Medical Certificate submitted as documentary evidence18 is proof of its contents, including the date thereof which states
that respondent was already declared fit to work on January 17, 2000, the date of his scheduled deployment.

Next, petitioners contend that respondent’s employment contract was not perfected pursuant to the POEA Standard
Employment Contract, which provides:

SEC 2. COMMENCEMENT/DURATION OF CONTRACT

A. The employment contract between the employer and the seafarer shall commence upon actual departure of the
seafarer from the airport or seaport in the point of hire and with a POEA approved contract. It shall be effective until the
seafarer’s date of arrival at the point of hire upon termination of his employment pursuant to Section 18 of this Contract.19

Petitioners argue that, as ruled by the NLRC, since respondent did not actually depart from the Ninoy Aquino International
Airport in Manila, no employer-employee relationship existed between respondent and petitioners’ principal, Ranger
Marine S.A., hence, there is no illegal dismissal to speak of, so that the award of damages must be set aside.

Petitioners assert that they did not conceal any information from respondent related to his contract of employment, from
his initial application until the release of the result of his medical examination. They even tried to communicate with
respondent for another shipboard assignment even after his failed deployment, which ruled out bad faith. They pray that
respondent’s complaint be dismissed for lack of merit.

Petitioners’ argument is partly meritorious.

An employment contract, like any other contract, is perfected at the moment (1) the parties come to agree upon its terms;
and (2) concur in the essential elements thereof: (a) consent of the contracting parties, (b) object certain which is the
subject matter of the contract, and (c) cause of the obligation.20 The object of the contract was the rendition of service by
respondent on board the vessel for which service he would be paid the salary agreed upon.

Hence, in this case, the employment contract was perfected on January 15, 2000 when it was signed by the parties,
respondent and petitioners, who entered into the contract in behalf of their principal, Ranger Marine S.A., thereby
signifying their consent to the terms and conditions of employment embodied in the contract, and the contract was
approved by the POEA on January 17, 2000. However, the employment contract did not commence, since petitioners did
not allow respondent to leave on January 17, 2000 to embark the vessel M/V AUK in Germany on the ground that he was
not yet declared fit to work on the day of departure, although his Medical Certificate dated January 17, 2000 proved that
respondent was fit to work.

In Santiago v. CF Sharp Crew Management, Inc.,21 the Court held that the employment contract did not commence when
the petitioner therein, a hired seaman, was not able to depart from the airport or seaport in the point of hire; thus, no
employer-employee relationship was created between the parties.

Nevertheless, even before the start of any employer-employee relationship, contemporaneous with the perfection of the
employment contract was the birth of certain rights and obligations, the breach of which may give rise to a cause of action
against the erring party.22 If the reverse happened, that is, the seafarer failed or refused to be deployed as agreed upon,
he would be liable for damages.23

The Court agrees with the NLRC that a recruitment agency, like petitioner BMC, must ensure that an applicant for
employment abroad is technically equipped and physically fit because a labor contract affects public interest.
Nevertheless, in this case, petitioners failed to prove with substantial evidence that they had a valid ground to prevent
respondent from leaving on the scheduled date of his deployment. While the POEA Standard Contract must be
recognized and respected, neither the manning agent nor the employer can simply prevent a seafarer from being
deployed without a valid reason.24

Petitioners’ act of preventing respondent from leaving and complying with his contract of employment constitutes breach
of contract for which petitioner BMC is liable for actual damages to respondent for the loss of one-year salary as provided
in the contract.25 The monthly salary stipulated in the contract is US$670, inclusive of allowance.

The Court upholds the award of moral damages in the amount of ₱30,000.00, as the Court of Appeals correctly found
petitioners’ act was tainted with bad faith,26 considering that respondent’s Medical Certificate stated that he was fit to
work on the day of his scheduled departure, yet he was not allowed to leave allegedly for medical reasons.1âwphi1

Further, the Court agrees with the Court of Appeals that petitioner BMC is liable to respondent for exemplary damages,27
which are imposed by way of example or correction for the public good in view of petitioner’s act of preventing respondent
from being deployed on the ground that he was not yet declared fit to work on the date of his departure, despite evidence
to the contrary. Such act, if tolerated, would prejudice the employment opportunities of our seafarers who are qualified to
be deployed, but prevented to do so by a manning agency for unjustified reasons. Exemplary damages are imposed not
to enrich one party or impoverish another, but to serve as a deterrent against or as a negative incentive to curb socially
deleterious actions.28 In this case, petitioner should be held liable to respondent for exemplary damages in the amount of
₱50,000.00,29 following the recent case of Claudio S. Yap v. Thenamaris Ship’s Management, et al.,30 instead of
₱10,000.00

The Court also holds that respondent is entitled to attorney’s fees in the concept of damages and expenses of litigation.31
Attorney's fees are recoverable when the defendant's act or omission has compelled the plaintiff to incur expenses to
protect his interest.32 Petitioners’ failure to deploy respondent based on an unjustified ground forced respondent to file
this case, warranting the award of attorney’s fees equivalent to ten percent (10%) of the recoverable amount.33

WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals in CA-G.R. SP No. 67571, dated October
25, 2004, is AFFIRMED with modification. Petitioner Bright Maritime Corporation is hereby ORDERED to pay respondent
Ricardo B. Fantonial actual damages in the amount of the peso equivalent of US$8,040.00, representing his salary for
one year under the contract; moral damages in the amount Thirty Thousand Pesos (₱30,000.00); exemplary damages
that is increased from Ten Thousand Pesos (₱10,000.00) to Fifty Thousand Pesos (₱50,000.00), and attorney’s fees
equivalent to ten percent (10%) of the recoverable amount.

Costs against petitioners.

SO ORDERED.
12. Atlas Farms, Inc. v. NLRC, G.R. No. 142244 18 November 2002
[G.R. No. 142244. November 18, 2002.]

ATLAS FARMS, INC., Petitioner, v. NATIONAL LABOR RELATIONS COMMISSION, JAIME O. DELA PEÑA and
MARCIAL I. ABION, Respondents.

DECISION

QUISUMBING, J.:

Petitioner seeks the reversal of the decision 1 dated January 10, 2000 of the Court of Appeals in CA-G.R. SP No. 52780,
dismissing its petition for certiorari against the NLRC, as well as the resolution 2 dated February 24, 2000, denying its
motion for reconsideration.

The antecedent facts of the case, as found by the Court of Appeals, 3 are as follows:chanrob1es virtual 1aw library

Private respondent Jaime O. dela Peña was employed as a veterinary aide by petitioner in December 1975. He was
among several employees terminated in July 1989. On July 8, 1989, he was re-hired by petitioner and given the additional
job of feedmill operator. He was instructed to train selected workers to operate the feedmill.

On March 13, 1993, 4 Peña was allegedly caught urinating and defecating on company premises not intended for the
purpose. The farm manager of petitioner issued a formal notice directing him to explain within 24 hours why disciplinary
action should not be taken against him for violating company rules and regulations. Peña refused, however, to receive the
formal notice. He never bothered to explain, either verbally or in writing, according to petitioner. Thus, on March 20, 1993,
a notice of termination with payment of his monetary benefits was sent to him. He duly acknowledged receipt of his
separation pay of P13,918.67.chanrob1es virtua1 1aw 1ibrary

From the start of his employment on July 8, 1989, until his termination on March 20, 1993, Peña had worked for seven
days a week, including holidays, without overtime, holiday, rest day pay and service incentive leave. At the time of his
dismissal from employment, he was receiving P180 pesos daily wage, or an average monthly salary of P5,402.

Co-respondent Marcial I. Abion 5 was a carpenter/mason and a maintenance man whose employment by petitioner
commenced on October 8, 1990. Allegedly, he caused the clogging of the fishpond drainage resulting in damages worth
several hundred thousand pesos when he improperly disposed of the cut grass and other waste materials into the pond’s
drainage system. Petitioner sent a written notice to Abion, requiring him to explain what happened, otherwise, disciplinary
action would be taken against him. He refused to receive the notice and give an explanation, according to petitioner.
Consequently, the company terminated his services on October 27, 1992. He acknowledged receipt of a written notice of
dismissal, with his separation pay.

Like Peña, Abion worked seven days a week, including holidays, without holiday pay, rest day pay, service incentive leave
pay and night shift differential pay. When terminated on October 27, 1992, Abion was receiving a monthly salary of
P4,500.

Peña and Abion filed separate complaints for illegal dismissal that were later consolidated. Both claimed that their
termination from service was due to petitioner’s suspicion that they were the leaders in a plan to form a union to compete
and replace the existing management-dominated union.

On November 9, 1993, the labor arbiter dismissed their complaints on the ground that the grievance machinery in the
collective bargaining agreement (CBA) had not yet been exhausted. Private respondents availed of the grievance
process, but later on refiled the case before the NLRC in Region IV. They alleged "lack of sympathy" on petitioner’s part to
engage in conciliation proceedings.chanrob1es virtua1 1aw 1ibrary

Their cases were consolidated in the NLRC. At the initial mandatory conference, petitioner filed a motion to dismiss, on
the ground of lack of jurisdiction, alleging private respondents themselves admitted that they were members of the
employees’ union with which petitioner had an existing CBA. This being the case, according to petitioner, jurisdiction over
the case belonged to the grievance machinery and thereafter the voluntary arbitrator, as provided in the CBA.

In a decision dated January 30, 1996, the labor arbiter dismissed the complaint for lack of merit, finding that the case was
one of illegal dismissal and did not involve the interpretation or implementation of any CBA provision. He stated that
Article 217 (c) of the Labor Code 6 was inapplicable to the case. Further, the labor arbiter found that although both
complainants did not substantiate their claims of illegal dismissal, there was proof that private respondents voluntarily
accepted their separation pay and petitioner’s financial assistance.

Thus, private respondents brought the case to the NLRC, which reversed the labor arbiter’s decision. Dissatisfied with the
NLRC ruling, petitioner went to the Court of Appeals by way of a petition for review on certiorari under Rule 65, seeking
reinstatement of the labor arbiter’s decision. The appellate court denied the petition and affirmed the NLRC resolution with
some modifications, thus:chanrob1es virtual 1aw library

WHEREFORE, the petition is DENIED. The resolution in NLRC CA No. 010520–96 is AFFIRMED with the following
modifications:chanrob1es virtual 1aw library

1) The private respondents can not be reinstated, due to their acceptance of the separation pay offered by the petitioner;

2) The private respondents are entitled to their full back wages; and,
3) The amount of the separation pay received by private respondents from petitioner shall not be deducted from their full
back wages.chanrob1es virtua1 law library

Costs against petitioner.

SO ORDERED. 7

Petitioner forthwith filed its motion for reconsideration, which was denied in a resolution dated February 24, 2000, which
reads:chanrob1es virtual 1aw library

Acting on the Motion for Reconsideration filed by petitioner[s] which drew an opposition from private respondents, the
Court resolved to DENY the aforesaid motion for reconsideration, as the issues raised therein have been passed upon by
the Court in its questioned decision and no substantial arguments were presented to warrant its reversal, let alone
modification.

SO ORDERED. 8

In this petition now before us, petitioner alleges that the appellate court erred in:chanrob1es virtual 1aw library

I. . . . DENYING THE PETITION FOR CERTIORARI AND IN EFFECT AFFIRMING THE RULINGS OF THE PUBLIC
RESPONDENT NLRC THAT THE PRIVATE RESPONDENTS WERE ILLEGALLY DISMISSED;

II. . . . RULING THAT THE PRIVATE RESPONDENTS ARE ENTITLED TO SEPARATION PAY AND FULL
BACKWAGES;

III. . . . RULING THAT PETITIONER IS LIABLE FOR COSTS OF SUIT. 9

Petitioner contends that the dismissal of private respondents was for a just and valid cause, pursuant to the provisions of
the company’s rules and regulations. It also alleges lack of jurisdiction on the part of the labor arbiter, claiming that the
cases should have been resolved through the grievance machinery, and eventually referred to voluntary arbitration, as
prescribed in the CBA.

For their part, private respondents contend that they were illegally dismissed from employment because management
discovered that they intended to form another union, and because they were vocal in asserting, their rights. In any case,
according to private respondents, the petition involves factual issues that cannot be properly raised in a petition for review
on certiorari under Rule 45 of the Revised Rules of Court. 10

In fine, there are three issues to be resolved: 1) whether private respondents were legally and validly dismissed; 2)
whether the labor arbiter and the NLRC had jurisdiction to decide complaints for illegal dismissal; and 3) whether
petitioner is liable for costs of the suit.

The first issue primarily involves questions of fact, which can serve as basis for the conclusion that private respondents
were legally and validly dismissed. The burden of proving that the dismissal of private respondents was legal and valid
falls upon petitioner. The NLRC found that petitioner failed to substantiate its claim that both private respondents
committed certain acts that violated company rules and regulations, 11 hence we find no factual basis to say that private
respondents’ dismissal was in order. We see no compelling reason to deviate from the NLRC ruling that their dismissal
was illegal, absent a showing that it reached its conclusion arbitrarily. 12 Moreover, factual findings of agencies exercising
quasi-judicial functions are accorded not only respect but even finality, aside from the consideration here that this Court is
not a trier of facts. 13

Anent the second issue, Article 217 of the Labor Code provides that labor arbiters have original and exclusive jurisdiction
over termination disputes. A possible exception is provided in Article 261 of the Labor Code, which provides that —

The Voluntary Arbitrator or panel of voluntary arbitrators shall have original and exclusive jurisdiction to hear and decide
all unresolved grievances arising from the interpretation or implementation of the Collective Bargaining Agreement and
those arising from the interpretation or enforcement of company personnel policies referred to in the immediately
preceding article. Accordingly, violations of a Collective Bargaining Agreement, except those which are gross in character,
shall no longer be treated as unfair labor practice and shall be resolved as grievances under the Collective Bargaining
Agreement. For purposes of this article, gross violations of Collective Bargaining Agreement shall mean flagrant and or
malicious refusal to comply with the economic provisions of such agreement.chanrob1es virtua1 1aw 1ibrary

The Commission, its Regional Offices and the Regional Directors of the Department of Labor and Employment shall not
entertain disputes, grievances or matters under the exclusive and original jurisdiction of the Voluntary Arbitrator or panel
of Voluntary Arbitrators and shall immediately dispose and refer the same to the grievance Machinery or Arbitration
provided in the Collective Bargaining Agreement.

But as held in Vivero v. CA, 14 "petitioner cannot arrogate into the powers of Voluntary Arbitrators the original and
exclusive jurisdiction of Labor Arbiters over unfair labor practices, termination disputes, and claims for damages, in the
absence of an express agreement between the parties in order for Article 262 of the Labor Code [Jurisdiction over other
labor disputes] to apply in the case at bar."cralaw virtua1aw library

Moreover, per Justice Bellosillo:chanrob1es virtual 1aw library

It may be observed that under Policy Instruction No. 56 of the Secretary of Labor, dated 6 April 1993, "Clarifying the
Jurisdiction Between Voluntary Arbitrators and Labor Arbiters Over Termination Cases and Providing Guidelines for the
Referral of Said Cases Originally Filed with the NLRC to the NCMB," termination cases arising in or resulting from the
interpretation and implementation of collective bargaining agreements and interpretation and enforcement of company
personnel policies which were initially processed at the various steps of the plant-level Grievance Procedures under the
parties’ collective bargaining agreements fall within the original and exclusive jurisdiction of the voluntary arbitrator
pursuant to Art. 217 (c) and Art. 261 of the Labor Code; and, if filed before the Labor Arbiter, these cases shall be
dismissed by the Labor Arbiter for lack of jurisdiction and referred to the concerned NCMB Regional Branch for
appropriate action towards and expeditious selection by the parties of a Voluntary Arbitrator or Panel of Arbitrators based
on the procedures agreed upon in the CBA.

As earlier stated, the instant case is a termination dispute falling under the original and exclusive jurisdiction of the Labor
Arbiter, and does not specifically involve the application, implementation or enforcement of company personnel policies
contemplated in Policy Instruction No. 56. Consequently, Policy Instruction No. 56 does not apply in the case at bar.
15 . . .

Records show, however, that private respondents sought without success to avail of the grievance procedure in their
CBA. 16 On this point, petitioner maintains that by so doing, private respondents recognized that their cases still fell under
the grievance machinery. According to petitioner, without having exhausted said machinery, the private respondents filed
their action before the NLRC, in a clear act of forum-shopping. 17 However, it is worth pointing out that private
respondents went to the NLRC only after the labor arbiter dismissed their original complaint for illegal dismissal. Under
these circumstances private respondents had to find another avenue for redress. We agree with the NLRC that it was
petitioner who failed to show proof that it took steps to convene the grievance machinery after the labor arbiter first
dismissed the complaints for illegal dismissal and directed the parties to avail of the grievance procedure under Article VII
of the existing CBA. They could not now be faulted for attempting to find an impartial forum, after petitioner failed to listen
to them and after the intercession of the labor arbiter proved futile. The NLRC had aptly concluded in part that private
respondents had already exhausted the remedies under the grievance procedure. 18 It erred only in finding that their
cause of action was ripe for arbitration.

In the case of Maneja v. NLRC, 19 we held that the dismissal case does not fall within the phrase "grievances arising from
the interpretation or implementation of the collective bargaining agreement and those arising from the interpretation or
enforcement of company personnel policies." In Maneja, the hotel employee was dismissed without hearing. We ruled that
her dismissal was unjustified, and her right to due process was violated, absent the twin requirements of notice and
hearing. We also held that the labor arbiter had original and exclusive jurisdiction over the termination case, and that it
was error to give the voluntary arbitrator jurisdiction over the illegal dismissal case.

In Vivero v. CA, 20 private respondents attempted to justify the jurisdiction of the voluntary arbitrator over a termination
dispute alleging that the issue involved the interpretation and implementation of the grievance procedure in the CBA.
There, we held that since what was challenged was the legality of the employee’s dismissal for lack of cause and lack of
due process, the case was primarily a termination dispute. The issue of whether there was proper interpretation and
implementation of the CBA provisions came into play only because the grievance procedure in the CBA was not
observed, after he sought his union’s assistance. Since the real issue then was whether there was a valid termination,
there was no reason to invoke the need to interpret nor question an implementation of any CBA, provision.chanrob1es
virtua1 1aw 1ibrary

One significant fact in the present petition also needs stressing. Pursuant to Article 260 21 of the Labor Code, the parties
to a CBA shall name or designate their respective representatives to the grievance machinery and if the grievance is
unsettled in that level, it shall automatically be referred to the voluntary arbitrators designated in advance by the parties to
a CBA. Consequently only disputes involving the union and the company shall be referred to the grievance machinery or
voluntary arbitrators. In these termination cases of private respondents, the union had no participation, it having failed to
object to the dismissal of the employees concerned by the petitioner. It is obvious that arbitration without the union’s
active participation on behalf of the dismissed employees would be pointless, or even prejudicial to their cause.

Coming to the merits of the petition, the NLRC found that petitioner did not comply with the requirements of a valid
dismissal. For a dismissal to be valid, the employer must show that: (1) the employee was accorded due process, and (2)
the dismissal must be for any of the valid causes provided for by law. 22 No evidence was shown that private respondents
refused, as alleged, to receive the notices requiring them to show cause why no disciplinary action should be taken
against them. Without proof of notice, private respondents who were subsequently dismissed without hearing were also
deprived of a chance to air their side at the level of the grievance machinery. Given the fact of dismissal, it can be said
that the cases were effectively removed from the jurisdiction of the voluntary arbitrator, thus placing them within the
jurisdiction of the labor arbiter. 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 brought to voluntary arbitration. But, where there was
already actual termination, with alleged violation of the employee’s rights, it is already cognizable by the labor arbiter. 23

In sum, we conclude that the labor arbiter and then the NLRC had jurisdiction over the cases involving private
respondents’ dismissal, and no error was committed by the appellate court in upholding their assumption of jurisdiction.

However, we find that a modification of the monetary awards is in order. As a consequence of their illegal dismissal,
private respondents are entitled to reinstatement to their former positions. But since reinstatement is no longer feasible
because petitioner had already closed its shop, separation pay in lieu of reinstatement shall be awarded. 24 A terminated
employee’s receipt of his separation pay and other monetary benefits does not preclude reinstatement or full benefits
under the law, should reinstatement be no longer possible. 25 As held in Cariño v. ACCFA: 26

Acceptance of those benefits would not amount to estoppel. The reason is plain. Employer and employee, obviously, do
not stand on the same footing. The employer drove the employee to the wall. The latter must have to get hold of the
money. Because out of job, he had to face the harsh necessities of life. He thus found himself in no position to resist
money proffered. His, then, is a case of adherence, not of choice. One thing sure, however, is that petitioners did not
relent their claim. They pressed it. They are deemed not to have waived their rights. Renuntiato non
praesumitur.chanrob1es virtua1 1aw 1ibrary

Conformably, private respondents are entitled to separation pay equivalent to one month’s salary for every year of
service, in lieu of reinstatement. 27 As regards the award of damages, in order not to further delay the disposition of this
case, we find it necessary to expressly set forth the extent of the backwages as awarded by the appellate court. Pursuant
to R.A. 6715, as amended, private respondents shall be entitled to full backwages computed from the time of their illegal
dismissal up to the date of promulgation of this decision without qualification, considering that reinstatement is no longer
practicable under the circumstances. 28

Having found private respondents’ dismissal to be illegal, and the labor arbiter and the NLRC duly vested with jurisdiction
to hear and decide their cases, we agree with the appellate court that petitioner should pay the costs of suit.

WHEREFORE, the petition is DENIED for lack of merit. The decision of the Court of Appeals in CA-G.R. SP No. 52780 is
AFFIRMED with the MODIFICATION that petitioner is ordered to pay private respondents (a) separation pay, in lieu of
their reinstatement, equivalent to one month’s salary for every year of service, (b) full backwages from the date of their
dismissal up to the date of the promulgation of this decision, together with (c) the costs of suit.

SO ORDERED.
13. SMC, Inc. v. SMC Employees Union, G.R. No. 168569, 5 October 2007
[G.R. NO. 168569 : October 5, 2007]

SAN MIGUEL FOODS, INC., Petitioner, v. SAN MIGUEL CORPORATION EMPLOYEES UNION-PTWGO, Respondent.

DECISION

CARPIO MORALES, J.:

The present Petition for Review on Certiorari raises the issue of whether respondent's complaint is one for unfair labor
practice (ULP) over which a Labor Arbiter has jurisdiction.

At the time material to the case, respondent, San Miguel Corporation Employees Union - PTWGO (the Union), was the
sole bargaining agent of all the monthly paid employees of petitioner San Miguel Foods, Incorporated (SMFI). On
November 9, 1992, some employees of SMFI's Finance Department, through the Union represented by Edgar Moraleda,
brought a grievance against Finance Manager Gideon Montesa (Montesa), for "discrimination, favoritism, unfair labor
practices, not flexible [sic], harassment, promoting divisiveness and sectarianism, etc.,"1 before SMFI Plant Operations
Manager George Nava in accordance with Step 1 of the grievance machinery adopted in the Collective Bargaining
Agreement (CBA) forged by SMFI and the Union.

The Union sought the "1. review, evaluat[ion] & upgrad[ing of] all Finance staff and 2. promot[ion of] G.Q. Montesa to
other SMC affiliate[s] & subsidiaries."2

At the grievance meeting held on January 14, 1993, SMFI informed the Union that it planned to address the grievance
through a "work management review" which would be completed by March 1993, hence, it asked the finance personnel to
give it their attention and cooperation.

The "work management review" was not completed by March 1993, however, prompting the Union to, on March 26, 1993,
elevate the grievance to Step 2.3

Almost nine months after the grievance meeting was held or on October 6, 1993, SMFI rendered a "Decision on Step 1
Grievance" stating that it was still in the process of completing the "work management review,"4 hence, the Union's
requests could not be granted.

The Union thereupon filed a complaint on October 20, 1993 before the National Labor Relations Commission (NLRC),
Arbitration Branch, against SMFI,5 its President Amadeo P. Veloso, and its Finance Manager Montesa for "unfair labor
practice, [and] unjust discrimination in matters of promotion . . . "6 It prayed that SMFI et al. be ordered to promote the
therein named employees "with the corresponding pay increases or adjustment including payment of salary differentials
plus attorney's fees[,] and to cease and desist from committing the same unjust discrimination in matters of promotion."7

Instead of filing a position paper as required by the Labor Arbiter, SMFI et al. filed a motion to dismiss,8 contending that
the issues raised in the complaint were grievance issues and, therefore, "should be resolved in the grievance machinery
provided in [the] collective bargaining agreements [sic] of the parties or in the mandated provision of voluntary arbitration
which is also provided in the CBA."9 The Union opposed the motion to dismiss.

In its Position Paper, the Union specified acts of ULP of SMFI et al. under Article 248, paragraphs (e) and (i) of the Labor
Code10 which Article reads:

Art. 248. Unfair labor practices of employers. - It shall be unlawful for an employer to commit any of the following unfair
labor practices:

x x x

(e) To discriminate in regard to wages, hours of work, and other terms and conditions of employment in order to
encourage or discourage membership in any labor organization. x x x

x x x

(i) To violate a collective bargaining agreement.

x x x

By Order of February 18, 1994, the Labor Arbiter granted SMFI et al.'s motion to dismiss and ordered the remand of the
case to the grievance machinery for completion of the proceedings.11 The Union appealed the said order to the NLRC by
"Motion for Reconsideration/Appeal"12 which its Second Division granted and accordingly ordered the Labor Arbiter to
continue the proceedings on the Union's complaint.13 SMFI et al. filed a Motion for Reconsideration of the NLRC order
but it was denied, hence, they filed a petition for certiorari with this Court. After the parties and the Solicitor General had
filed their respective pleadings, this Court, by Resolution of January 25, 1999, referred the case to the Court of Appeals
pursuant to St. Martin Funeral Homes v. NLRC.14

By Decision of July 31, 2002,15 the Court of Appeals denied SMFI et al.'s petition for certiorari, it holding that the Labor
Arbiter has jurisdiction over the complaint of the Union, they having violated the seniority rule under the CBA by
appointing and promoting certain employees which amounted to a ULP.16

Before this Court, SMFI lodged the present Petition for Review on Certiorari, faulting the appellate court in

A.
. . . FINDING THAT THE LABOR ARBITER HAS JURISDICTION OVER THE COMPLAINT OF RESPONDENT UNION

B.

. . . FINDING THAT SMFI'S ALLEGED VIOLATION OF THE CBA CONSTITUTES UNFAIR LABOR PRACTICE.

The jurisdiction of Labor Arbiters, enumerated in Article 217 of the Labor Code, includes complaints for ULP.

SMFI argues that the allegations in the Union's complaint filed before the Labor Arbiter do not establish a cause of action
for ULP, the Union having merely contended that SMFI was guilty thereof without specifying the ultimate facts upon which
it was based. It cites Section 1 of Rule 8 of the Rules of Court as applying suppletorily to the proceedings before the Labor
Arbiter, which Section reads:

Section 1. In general. - Every pleading shall contain in a methodical and logical form, a plain concise and direct statement
of the ultimate facts on which the party pleading relies for his claim . . .

Alleging that the Union failed to comply with this Rule, SMFI concludes that the Labor Arbiter has no jurisdiction over its
complaint.

A perusal of the complaint shows that, indeed, the particular acts of ULP alleged to have been committed by SMFI were
not specified; neither were the ultimate facts in support thereof. In its Position Paper, however, the Union detailed the
particular acts of ULP attributed to SMFI and the ultimate facts in support thereof.

Section 7, Rule V of the New Rules of Procedure of the NLRC provides:

Nature of Proceedings. - The proceedings before the Labor Arbiter shall be non-litigious in nature. Subject to the
requirements of due process, the technicalities of law and procedure and the rules obtaining in the courts of law shall not
strictly apply thereto. The Labor Arbiter may avail himself of all reasonable means to ascertain the facts of the controversy
speedily, including ocular inspection and examination of well-informed persons. (Emphasis and underscoring
supplied)cralawlibrary

Section 1 of Rule 8 of the Rules of Court should thus not be strictly applied to a case filed before a Labor Arbiter. In
determining jurisdiction over a case, allegations made in the complaint, as well as those in the position paper, may thus
be considered.

As stated above, the Union, in its Position Paper, mentioned the particular acts of ULP and the ultimate facts in support
thereof. Thus it alleged:

This is a complaint for unfair labor practices pursuant to Article 248 (e) and (i) of the Labor Code, as amended, which
reads:

Art. 248. Unfair labor practices of employers. - It shall be unlawful for an employer to commit any of the following unfair
labor practices:

x x x

(e) To discriminate in regard to wages, hours of work, and other terms and conditions of employment in order to
encourage or discourage membership in any labor organization.

x x x

(i) to violate a collective bargaining agreement.

and which was committed by herein respondents as follows:

1. large scale and wanton unjust discrimination in matters of promotion, particularly upon the following members of
complainant: Ellen Ventura, Julie Geronimo, Ronnie Cruz, Rita Calasin, Romy de Peralta, Malou Alano, And E. M.
Moraleda, all assigned with the Finance Department or respondent SMFI.

2. gross and blatant violations by respondent SMFI of Section 5, Article III (Job Security) and Section 4, Article VIII
(Grievance Machinery) of the current collective bargaining agreement (CBA) between complainant and respondent SMFI,
which provisions of said CBA are hereunder quoted for easy reference. (Emphasis and underscoring
supplied)cralawlibrary

On the questioned promotions, the Union did not allege that they were done to encourage or discourage membership in a
labor organization. In fact, those promoted were members of the complaining Union. The promotions do not thus amount
to ULP under Article 248(e) of the Labor Code.

As for the alleged ULP committed under Article 248(i), for violation of a CBA, this Article is qualified by Article 261 of the
Labor Code, the pertinent portion of which latter Article reads:

x x x violations of a Collective Bargaining Agreement, except those which are gross in character, shall no longer be
treated as unfair labor practice and shall be resolved as grievances under the Collective Bargaining Agreement. For
purposes of this article, gross violations of Collective Bargaining Agreement shall mean flagrant and/or malicious refusal
to comply with the economic provisions of such agreement. (Emphasis and underscoring supplied)cralawlibrary

Silva v. NLRC instructs that for a

ULP case to be cognizable by the Labor Arbiter, and the NLRC to exercise its appellate jurisdiction, the allegations in the
complaint should show prima facie the concurrence of two things, namely: (1) gross violation of the CBA; AND (2) the
violation pertains to the economic provisions of the CBA.17 (Emphasis and underscoring supplied)cralawlibrary

As reflected in the above-quoted allegations of the Union in its Position Paper, the Union charges SMFI to have violated
the grievance machinery provision in the CBA. The grievance machinery provision in the CBA is not an economic
provision, however, hence, the second requirement for a Labor Arbiter to exercise jurisdiction of a ULP is not present.

The Union likewise charges SMFI, however, to have violated the Job Security provision in the CBA, specifically the
seniority rule, in that SMFI "appointed less senior employees to positions at its Finance Department, consequently
intentionally by-passing more senior employees who are deserving of said appointment."

Article 4 of the Labor Code provides that "All doubts in the implementation and interpretation of the provisions of this
Code, including implementing rules and regulations, shall be resolved in favor of labor." Since the seniority rule in the
promotion of employees has a bearing on salary and benefits, it may, following a liberal construction of Article 261 of the
Labor Code, be considered an "economic provision" of the CBA.

As above-stated, the Union charges SMFI to have promoted less senior employees, thus bypassing others who were
more senior and equally or more qualified. It may not be seriously disputed that this charge is a gross or flagrant violation
of the seniority rule under the CBA, a ULP over which the Labor Arbiter has jurisdiction.

SMFI, at all events, questions why the Court of Appeals came out with a finding that it (SMFI) disregarded the seniority
rule under the CBA when its petition before said court merely raised a question of jurisdiction. The Court of Appeals
having affirmed the NLRC decision finding that the Labor Arbiter has jurisdiction over the Union's complaint and thus
remanding it to the Labor Arbiter for continuation of proceedings thereon, the appellate court's said finding may be taken
to have been made only for the purpose of determining jurisdiction.

WHEREFORE, the Petition is DENIED.

SO ORDERED.
14. Oreshoot Mining Co. v. Arellano, 156 SCRA 498
G.R. Nos. 75746-48 December 14, 1987

ORESHOOT MINING COMPANY, petitioner,

vs.
HON. DIOSCORA C. ARELLANO, Director, Regional Office No. IV, MOLE, HON. VICENTE LEOGARDO, JR., Deputy
Minister, MOLE, THE ACTING SHERIFF, RO No. 4, MOLE, RODRIGO BAACO, MANUEL RODRIGUEZ, MELCHOR
GUMPAL et al.

NARVASA, J.:

Assailed in this special civil action of certiorari is the Order of the Deputy Minister of Labor and Employment, affirming with
modification the Order of the Director of Regional Office No. IV which, in three (3) separate but consolidated proceedings,
directed the reinstatement of private respondents and the payment to them of back wages and certain other benefits. 1

The Regional Director's Order, dated October 6, 1981, contained the following disposition, to with

WHEREFORE, premises considered, an Order is hereby entered as follows:

1. Respondent Oreshoot Mining Co. is hereby ordered to immediately reinstate to their former positions without loss of
seniority rights with full backwages as computed above, the complainants Rodrigo Baaco, Manuel Rodriguez, Rolando
Pacaldo Silvestre Teodoro, Albino Bungalso and Rufino Bungalso;

2. Respondent is also hereby ordered to pay the complainants the benefits in accordance with the computations made
above and is required that henceforth it should give the same benefits to all of its employees.

3. The total amount of benefits due the employees above referred to is P117,905.00.

Oresho.filed two (2) motions for reconsideration. The first was denied; the second was treated as an appeal and
transmitted by the Regional Director to the Office of the Minister of Labor and Employment. Acting thereon, the Deputy
Minister rendered an Order on May 27, 1985, affirming the aforesaid adjudgment made by the Regional Director with the
modification that sixteen (16) employees, who signed an affidavit of desistance in Oreshoot's favor, dated November 12,
1981, were dropped as party complainants. Subsequently, the Regional director issued a writ of execution on March 19,
1986 which the MOLE Deputy Sheriff sought to implement in July, 1986.

Oreshoot has come to this Court advocating the theory that all the proceedings above mentioned are void because the
Regional Director had no jurisdiction to take cognizance of and adjudicate the claims of private respondents. Additionally,
it imputes grave abuse of discretion to the Regional Director in (1) consolidating the three cases filed against it and
deciding them as one notwithstanding that the last two cases were filed after the first had already been submitted for
decision; (2) in not informing it Oreshoot of the non-indorsement of the cases to the Labor Arbiter as required by Article
227 (now Article 228) of the Labor Code; and (3) ruling that there were no valid grounds for its shutdown of its business
on account of economic difficulties caused by world-wide recession.

Oreshoot is correct as regards its claim of the Regional Director's lack of competence over the cases in question. The
respondent Regional Director had no jurisdiction to try and decide claims of workers and employees of their illegal
dismissal from employment, and for their reinstatement and recovery of monetary and other benefits consequent thereto.
The writ of certiorari will issue in Oreshoot's favor. The same issue was raised in Zambales Base Metals, Inc. vs. The
Minister of Labor, et al., G.R. No. 73184-88, Nov. 26, 1986. In that case, in a substantially analogous factual context, this
Court, 2 resolved the issue in the following manner.

The issue is simple enough. The applicable provision is Article 217 of the Labor Code, which states as follows:

ART. 217. Jurisdiction of Labor Arbiters and the Commission — (a) The Labor Arbiters shall have the original and
exclusive jurisdiction to hear and decide within thirty (30) working days after submission of the case by the parties for
decision, the following cases involving all workers. whether agricultural or non-agricultural:

l. Unfair labor practice cases;

2. Those that workers may file involving wages, hours of work and other terms and conditions of employment;

3. All money claims of workers, including those based on non-payment or underpayment of wages, overtime
compensation, separation pay and other benefits provided by law or appropriate agreement, except claims for employees'
compensation, social security, medicare and maternity benefit

4. Cases involving household services; and

5. Cases arising from any violation of Article 265 of this Code, including questions involving the legality of strikes and
lockouts.

xxx xxx xxx

This article does not even need construction. It is obvious therefrom that only the labor arbiter could decide the cases filed
by the employees as they involved 'money claims' falling under No. 3 of the enumeration. As for the regional director, the
authority he invokes under Article 128 of the Labor Code confers upon him only visitorial powers over the employer's
premises and records, including the right to require compliance with the labor standards provisions of the Code, such as
those relating to industrial safety. Nowhere in the said article is the regional director empowered to share the original and
exclusive jurisdiction' conferred on the labor arbiters by Article 217.

At the time of the filing of the cases at bar, original and exclusive jurisdiction was vested in Labor Arbiters to hear and
decide inter alia (1) 11 all money claims of workers, including those based on non-payment or underpayment of wages,
overtime compensation, separation pay and other benefits provided by law or appropriate agreement, except claims for
employees' compensation, social security, medicare and maternity benefits," and (2) "all other claims arising from
employer-employee relations, unless expressly excluded by ... (the) Code. 3

The Regional Director had direct and administrative control and supervision over (a)ll Labor Arbiters in his region. 4 As
such he was empowered to assign cases to Labor Arbiters, "taking into consideration their workload, nature of the case,
complexity of the issues involved and other factors, with the view of expediting disposition of cases." A Labor Arbiter could
take cognizance only of "cases indorsed to him for compulsory arbitration by the Bureau or by the Regional Director, " but
the "indorsement or non-indorsement of the Regional Director ... (could) be appealed to the Bureau within ten working
days from receipt of the notice.5

In the case of a money claim, the Regional Director's power was limited to receiving the complaint, investigating it and
trying to effect conciliation, and, if no settlement was reached, certifying the case to the Labor Arbiter. That certification
could not however be made if (a) the complaint patently lacks cause of action; (b) the causes of action have already
prescribed (c) the complaint patently partakes of the nature of harassment; and (d) the complaint is barred by prior
judgment. 6

In cases of shutdowns or dismissals, as to which prior clearance was formerly required, the Regional Director was
empowered to initially decide whether to certify the same to the Executive Labor Arbiter or to summarily investigate and
decide it within 10 days from filing; but if there had been a 11 preventive suspension on the employee effected by the
employer, the Regional Director ... (was) bound to rule first thereon: whether to lift or sustain the same or to stop or give
due course to an intended one. " As a matter of policy the Regional Director certified the case to the Executive Arbiter "(a)
if the nature of the case does not suit summary investigation, or (b) if intricate questions of law are involved." And if he did
not deny the application, he had to "immediately certify the same to the Executive Arbiter for hearing and decision on the
merits. 7

It is worthy of note that where there was need for "hearing and decision on the merits" as regards applications for
clearance to shut down or dismiss, that function of hearing and deciding was not entrusted to the Regional Director but to
the Executive Arbiter (or other Labor Arbiters). This is clear from the provision requiring the Regional Director to certify the
case to the Executive Arbiter. That and other related provisions make clear that in reality, the only power accorded to the
Director was either to deny the application for shut down or dismissal after "summary investigation," or certify the same to
the Executive Arbiter. And he could only himself act on an application for clearance to shut down or dismiss, only if the
case did not involve "intricate questions of law" or was not otherwise suited for summary investigation. 8 But, to repeat,
where there was necessity to pass "upon the merits" of an application, he could not deny it, but had perforce to certify it to
the Executive Arbiter.

It is also worthy of note that the jurisdiction of the Regional Director in this regard is by express terms confined to
applications for shut downs and dismissals; i.e., those projected or proposed to be effected in future. Withheld from him by
necessary implication, therefore, are cases involving actual shut downs or dismissals, already effected by the employer,
where determination of the merits thereof becomes inevitable upon complaint of the employees thereby affected. 9

Now, when Batas Pambansa Bilang 130 took effect on August 21, 1981, the clearance requirement for shut downs and
dismissals was eliminated. The power of the Regional Director to pass upon applications therefor thus disappeared. So,
too, did his power to indorse cases to Labor Arbiters vanish; the Labor Arbiters were placed by the batas under the
supervision of the Chairman of the National Labor Relations Commission. Withal, the Regional Director retained the
power to conciliate in termination cases (but not to pass upon and decide the merits thereof). 10

The latest amendment to Article 217 of the Labor Code was worked by Section 2, Batas Pambansa Bilang 227, effective
June 1, 1982. Said Section 217, as lastly amended, is reproduced in full in the excerpt from Zambales Base Metals, Inc. v.
Minister of Labor, 146 SCRA 50 quoted earlier in this opinion. 11 It will at once be perceived that the amendment does not
at all affect, much less expand, the jurisdiction of the Regional Director. The Director continues to be without competence
or authority to hear and decide any of the matters specifically placed by law within the original and exclusive jurisdiction of
Labor Arbiters.

In this case the Court will therefore make the same disposition as it did in Zambales. "Inasmuch as the proceedings
before the regional director were null and void ab initio for lack of jurisdiction, the complaints for (back) wages and other
benefits filed by the employees against the petitioner should be remanded to the labor arbiter for appropriate action," with
the expectation "that resolution of these cases will be effected with the least possible delay." The other issues raised by
the petitioner obviously need no longer be resolved.

WHEREFORE, the questioned Order of the public respondents dated October 6, 1981 and May 27, 1985, and other
related orders and writs, are hereby nullified and set aside. The private respondents' complaints are remanded to the
corresponding labor arbiter, with the direction that the same be heard and decided with all deliberate disptach. No costs.
15. Albay I Electric Cooperative Inc. v. Martinez, G.R. 95559, 9 November 1993
G.R. No. 95559 November 9, 1993

ALBAY I ELECTRIC COOPERATIVE, INC. (ALECO I), Petitioner, vs. RICARDO S. MARTINEZ, Sr., ARNOLD B.
BONAGUA and CONRADO S. BUBAN, Respondents.

Juan D. Victoria for petitioner.chanrobles virtual law library

Marietta Lea B. Rosana for private respondents.

BIDIN, J.:

This special civil action for certiorari seeks the annulment of the Orders dated September 11, 1989 and September 3,
1990 issued by respondent Ricardo Martinez, Sr., Regional Director, Department of Labor and Employment, Regional
Office No. 5, Legazpi City, for having been rendered in excess of jurisdiction.chanroblesvirtualawlibrarychanrobles virtual
law library

Petitioner avers that on August 15, 1988, private respondents Conrado Buban and Arnaldo Bonagua were designated as
acting manager (Commercial Services Department) and supervisor (Service Center), respectively, of Albay I Electric
Cooperative, inc. by Israel Garcia, petitioner's Acting General Manager. Garcia allegedly made the appointments after his
own appointment was recalled by the National Electrification Administration (NEA) by virtue of Office Order No. 454
issued on August 10, 1988 effective immediately. (Rollo p. 31)chanrobles virtual law library

On August 27, 1988, the Board of Director of ALECO I considered the midnight appointments of respondents Buban and
Bonagua as null and void. In a Memorandum dated June 7, 1989, Romulo Maristaza, Chief of the Legal Service Office of
the NEA, considered as defective the appointments of private respondents there being serious doubts as to their validity.
(Rollo p. 14-15)chanrobles virtual law library

On August 15, 1989, private respondents filed a complaint with the Office of the Regional Director for the recovery of
salary differentials corresponding to their new positions. They also claimed that since they held their respective positions
for more than one year, their status should be classified as permanent and they should be paid the corresponding
salaries.chanroblesvirtualawlibrarychanrobles virtual law library

Petitioner moved to dismiss the complaint for lack of jurisdiction. Nonetheless, on September 11, 1989, respondent
Regional Director issued an Order requiring the petitioner to pay respondents Bonagua and Buban P11,962.31 and
P12,593.36, respectively, corresponding to the underpayment of wages for their new positions (Rollo, p. 16)chanrobles
virtual law library

On September 19, 1989, petitioner filed a notice of appeal and Memorandum of Appeal. Instead of giving due course to
the appeal, the Med-Arbiter denied the same and directed the parties to present evidence (Rollo, p. 23). In its position
paper, petitioner assailed the Order denying its appeal and further argued that since the amount claimed by private
respondents is in excess of P5,000.00, the Regional Director has no jurisdiction to entertain the
complaint.chanroblesvirtualawlibrarychanrobles virtual law library

On September 3, 1990, the Regional Director issued another Order, this time requiring petitioner to pay respondent
Bonagua the amount of P9,259.72 and respondent Buban P38,243.21 corresponding to their salary differentials and 13th
month pay (Rollo p. 32). Public respondent also held that since the complainants (private respondents) were allowed to
discharge their functions for more than one year without objection or adverse action on the part of the petitioner, this
amounted to acquiescence and an implied approval of their appointments. Thereafter, a writ of execution was issued on
September 26, 1990.chanroblesvirtualawlibrarychanrobles virtual law library

Hence this petition.chanroblesvirtualawlibrarychanrobles virtual law library

Petitioner contends that since each of the money claims of private respondent exceeded P5,000.00, the complaint falls
outside the jurisdiction of the respondent Regional Director and should properly be heard by the Labor
Arbiter.chanroblesvirtualawlibrarychanrobles virtual law library

Public respondent argues however that under his visitorial power, the P5,000.00 jurisdictional limit does not apply, citing
for the purpose Brokenshire Memorial Hospital Inc., vs. Minister of Labor and Employment (182 SCRA 5 [1990]), to wit:

If the amount involved does not exceed P5,000.00, the Regional Director undeniably has jurisdiction. But even if the
amount of the claim exceeds P5,000.00, the claim is not on that account necessarily removed from the Regional Director's
competence. In respect thereof, he may still exercise the visitorial powers vested in him by Article 128 of the Labor Code,
as amended, supra; that is to say, he may still direct his labor regulations officers or industrial safety engineers to inspect
the employer's premises and examine his records; and if the officers should find that there have been violations of labor
standard provisions, the Regional Director may, after due notice and hearing order compliance by the employer therewith
and issue a writ of execution to the appropriate authority for the enforcement thereof. However, this power may not,
repeat, be exercised by him where the employer contests the labor regulation officers' findings and raises issues which
cannot be resolved without considering the evidentiary matters not verifiable in the normal course of inspection. In such
an event, the case will have to be referred to the corresponding Labor Arbiter for adjudication, since it falls within the
latter's exclusive original jurisdiction (citing Briad Agro Development Corp.).

Public respondent hastens to add that the purpose of the law is to afford to the workers an expeditious delivery of what
legally belongs to them; thus, the jurisdictional P5,000.00 limit need not apply. On the other hand, private respondents
submit that the Regional Director has the power and authority in complaints for inspection cases to hear and decide labor
standard cases where employer-employee relationships still exists between the parties. The law does not put a limit as to
what should be the minimum claim of the employees in order to seek relief under Article 128 of the Labor
Code.chanroblesvirtualawlibrarychanrobles virtual law library

In his Manifestation in Lieu of Comment, the Solicitor General submits that the claims of private respondents for unpaid
wages properly fall under the exclusive and original jurisdiction of the Labor Arbiter, mainly because the money claims of
private respondents exceed P5,000.00. In addition, the Regional Director ordered the payment of the salary differentials
not in connection with his visitorial powers but in the adjudication of the claims or complaints of the private
respondents.chanroblesvirtualawlibrarychanrobles virtual law library

Article 129 and Article 217 of the Labor Code, as amended by R.A. 6715, provide:

Art. 129. Recovery of wages, simple money claims and other benefits. - Upon complaint of any interested party, the
Regional Director of the Department of Labor and Employment or any of the duly authorized hearing officers of the
Department is empowered, through summary proceeding and after due notice, to hear and decide any matter involving
the recovery of wages and other monetary claims and benefits, including legal interest, owing to an employee or person
employed in domestic or household service or househelper under this Code, arising from employer-employee relations.
Provided, That such complaint does not include a claim for reinstatement; provided further, That the aggregate money
claims of each employee or househelper do not exceed five thousand pesos
P5,000.00). . . .chanroblesvirtualawlibrarychanrobles virtual law library

Art. 217. Jurisdiction of Labor Arbiters and the Commission. - Except as otherwise provided under this Code, the Labor
Arbiters shall have original and exclusive jurisdiction to hear and decide, within thirty (30) calendar days after the
submission of the case by the parties for decision without extension, even in the absence of stenographic notes, the
following cases involving workers, whether agricultural or non-agricultural:

xxx xxx xxxchanrobles virtual law library

(6) Except claims for employees compensation, social security, medicare and maternity benefits, all other claims arising
from employer-employee relations, including those of persons in domestic or household service, involving an amount
exceeding five thousand pesos (P5,000.00), whether or not accompanied with a claim for reinstatement.

Clearly, the jurisdiction over the instant dispute lies exclusively and originally with the Labor Arbiter, the claims being in
excess of P5,000.00 each. Thus, respondents' reliance in Brokenshire (supra) is evidently misplaced. For, and in
construing the aforequoted provisions, the Court did not confer unlimited jurisdiction on the Regional Director. Rather, it
qualified the Regional Director's jurisdiction to hear and decide employee's claims, to wit:

It will be observed that what in fact conferred upon Regional Directors and other hearing officers of the Department of
Labor (aside from the Labor Arbiters) adjudicative powers, i.e., the power to try and decide, or hear and determine any
claim brought before them for recovery of wages, simple money claims, and other benefits, is Republic Act 6715, provided
that the following requisites concur, to wit:chanrobles virtual law library

1) The claim is presented by an employee or person employed in domestic or household service or househelper under the
code;chanrobles virtual law library

2) The claimant, no longer being employed, does not seek reinstatement; andchanrobles virtual law library

3) The aggregate money claim of the employee or househelper does not exceed five thousand pesos
(P5,000.00).chanroblesvirtualawlibrarychanrobles virtual law library

In the absence of any of the three (3) requisites, the Labor Arbiters have exclusive original jurisdiction over all claims
arising from employer-employee relations, other than claims for employees compensation, social security, medicare and
maternity benefits. (Brokenshire Memorial Hospital, Inc. vs. Minister of Labor and Employment, supra).

Neither can private respondents successfully invoke the visitorial power of the Regional Director as provided under Article
128 of the Labor Code. In Servando's Inc. vs. Secretary of Labor and Employment (198 SCRA 156 [1991]) the Court
ruled:

To construe the visitorial power of the Secretary of Labor to order and enforce compliance with labor laws as including the
power to hear and decide cases involving employees' claims for wages, arising from employer-employee relations, even if
the amount of said claims exceed P5,000.00 for each employee, would, in our considered opinion, emasculate and render
meaningless, if not useless, the provisions of Article 217 (a) (6) and Article 129 of the Labor Code which, as above
pointed out, confer exclusive jurisdiction on the Labor Arbiter to hear and decide such employee's claims (exceeding
P5,000.00 for each employee). To sustain the respondent's position would, in effect, sanction a situation where all
employee's claims, regardless of amount, can be heard and determined by the Secretary of Labor under this visitorial
power. This does not, however, appear to be the legislative intent.

xxx xxx xxxchanrobles virtual law library

. . . the power to hear and decide employee's claim exceeding P5,000.00 for each employee should be left to the Labor
Arbiter as the exclusive repository of the power to hear and decide such claims.chanroblesvirtualawlibrarychanrobles
virtual law library

Nor is this position devoid of sound reason or purpose because -chanrobles virtual law library

1. The proceedings before the Secretary of Labor (or his agents) exercising his visitorial powers is summary in nature. On
the other hand, proceedings before the Labor Arbiters are more formal and in accord with rules of evidence. When the
employee's claim in less than P5,000.00, a summary procedure for its settlement can be justified, but not when a claim is
more or less substantial, from the standpoint of both employee and management, for which reason, an employee's claim
exceeding P5,000.00 is placed within the exclusive jurisdiction of the Labor Arbiter to hear and
decide.chanroblesvirtualawlibrarychanrobles virtual law library

2. Article 129 of the Labor Code expressly provides that upon complaint of any interested party, the Regional Director
(and, consequently, the Secretary of Labor to whom appeals from the Regional Directors are taken) is empowered to hear
and decide simple money claims, i.e. those that do not exceed P5,000.00 for each employee, employing for this purpose
a summary procedure. If Article 128 (b) of the Labor Code were to be construed as empowering the Secretary of Labor,
under his visitorial power, to hear and decide all types of employee's claims, including those exceeding P5,000.00 for
each employee, employing for this purpose a summary procedure, then, Article 129 (limiting the Regional Director's
jurisdiction to a claim not exceeding P5,000.00) becomes a useless surplusage in the Labor Code.

Since the amount claimed by each respondent exceeded the P5,000.00 jurisdictional limit conferred upon public
respondent, the latter acted without jurisdiction in ordering petitioner to pay private respondents' claim for salary
differentials and 13th month pay (Midland Insurance Corporation v. Secretary of Labor and Employment, 214 SCRA 578
[1992]).chanroblesvirtualawlibrarychanrobles virtual law library

Furthermore, the fact that petitioner raised the propriety of granting the claimed salary differentials in favor of private
respondents should have alerted public respondent to exercise utmost restraint in assuming jurisdiction over the
complaint. When the employer contests the findings of the Regional Director, the case must be referred to the Labor
Arbiter. This is also a question of fact which cannot be dealt with by the Regional Director in view of the summary nature
of the proceedings attendant to the exercise of his visitorial powers (See Art. 128 [b]). It may be argued, however, that
respondent Regional Director found that respondents Buban and Bonagua were issued appointment papers on February
9, 1988 and March 22, 1988 respectively. Nevertheless, the fact that each of the private respondents' claim exceeded
P5,000.00 ousted respondent Martinez of jurisdiction, by operation of law, to hear and decide complainant's claim for
underpayment of wages.chanroblesvirtualawlibrarychanrobles virtual law library

It is a rule that when a tribunal acts in excess or lack of jurisdiction, all decisions, orders and processes emanating
thereform are null and void. Thus, on the issue posed by the petitioners regarding the denial of its appeal, suffice it to say
that in taking cognizance of the case at the first instance, the Regional Director already acted beyond the scope of his
jurisdiction. Necessarily, all orders and processes subsequently issued by him are without force and
effect.chanroblesvirtualawlibrarychanrobles virtual law library

WHEREFORE, the assailed Orders of the Regional Director dated September 11, 1989 and September 3, 1990 including
the writ of execution dated September 26, 1990, are hereby SET ASIDE and declared null and void. Each claim of private
respondents as regards their salary differentials and 13th month pay is hereby referred to the proper Labor Arbiter for
appropriate determination.chanroblesvirtualawlibrarychanrobles virtual law library

SO ORDERED.
 16. Cireneo Bowling Plaza, Inc. v. Sensing, G.R. 146572, 14 January 2005
17. Suario v. BPI, G.R. 50459, 25 August 1989
18. Rodriguez v. Aguilar.G.R. 159482, 30 August 2005
19. Quadra v. CA. G.R. 147593, 31 July 2006
20. Lawrence v. NLRC, G.R. No. 87421, 4 February 1992
21. Banez v.Valdevilla, G.R. 128024, 9 May 2000
22. SMC v. NLRC, 161 SCRA 719
23. LRTA v. Venus, G.R. No. 163782, 24 March 2006
24. NAPOCOR v.NLRC, G.R. No. 65802, 15 April 1988
25. Amecos Innovations, Inc. et.al v. Lopez G.R. No. 178055, 2 July 2014
26. Cosavev. Broadcom Asia, Inc. G.R. No. 201298, 5 February 2014
27. Lim v. HMR Phils., Inc. G.R. No. 201483, 4 August 2014
28. Security Bank Employees Union v. Security Bnk, 25 SCRA 503
29. Phimco Industries v. Brillantes, 304 SCRA 747
30. Yupangco Cotton Mills v. Mendoza, G.R. No. 139912, 3 March 2005
31. FEU-NRMF v. FEU-NRMFEA, G.R. No.168362, 12 October 2006
32. ABS-CBN Supervisors Employees Union members v. ABS-CBN Broadcasting Corp, 304 SCRA 489
33. Blanco v. PAM, G.R. No. 147941, 16 March 2005
34. Nacar v. Frames et.al. Gr. No. 189871, 13 August 2013
35. Turks Shawarma Co. v. Pajaron et. Al., G.R. No. 2017156 16 January 2017
36. Workers of Antigue Electric Coop., Inc. v. NLRC, G.R. No. 120062, 8 June 2000
37. EDI-Staffbuilders Int’l., Inc. v. NLRC, G.R. No. 145587, 16 October 2007
38. Lepanto Consolidated Mining Corp. v. Icao, G.R. No. 196047, 15 Jan 2014
39. Air Phils. Corp. v. Zamora, G.R. No. 148247, 7 August 2006
40. PCI Travel Corp. v. NLRC. G.R. No. 154379, 31 October 2008
41. King v. Gatan, G.R. No. 143831, 7 JULY 2003
42. Tag Fibers, Inc., v. NLRC, G.R. No. 120931, 20 October 2000
43. Carlos v. CA. G.R. No. 168096, 28 August 2007
44. Alemar’s Sibal and Sons, Inc. v. NLRC, G.R. No. 114761, 19 January 2000
45. LBP v. Listana, G.R. No. 152611, 5 August 2003

Article 232 (226)- 239 (233)

1. Atty. Montano v. Atty. Verceles, G.R. No. 168583, 26 July 2010

2. Heritage Hotel v. Nat’l Union Workers in Hotel, et.al., G.R. 178296, 12 January 2011
3. VErceles v. BLR, G.R. No. 152322, 15 February 2005
4. Diamonon v. DOLE, G.R. No. 108591, 7 March 2000
5. Insular Hotel Employees Union-NFL v. Waterfront Insular Hotel Davao, G.R. No. 174040-41, 22 September 2010
6. Eurotech Hair System, Inc. v. Go. G.R. No. 160913, 31 August 2006
7. Hanjin Heavy Industries v. Ibanez, G.R. No. 170181, 26 June 2008
8. Sime Darby v. Arguilla, G.R. No. 143542, 8 June 2006
9. PCEA v. Philippine Carpet Mfg. Corp., G.R. No. 140269-70, 14 Sep.2000
10. Acuna v. CA. G.R. No. 159832, 5 May 2006