Recit Digest

GOLANGCO LABREV DIGESTS
MODULE 1
ART. 219 [212]. DEFINITION OF LABOR DISPUTE
CITIBANK V. CA November 27, 1998 (Expired Security Agency
Contract)
FACTS: Citibank used to have a contract for security agency with El Toro Security Agency. The contract
eventually expired which prompted the CIGLA, the union of the security guards, to file a preventive
mediation with NCMB.
Meanwhile, Citibank served a notice to El Toro that it will no longer renew the contract. On that same
day, Citibank also entered into a contract with another security agency. Because of this, CIGLA
converted their request for preventive mediation into a notice of strike for failure of parties to reach
settlement of issues.
This prompted Citibank to file a complaint for injunction and damages before RTC. CIGLA moved for the
dismissal of the complaint on the ground that the issue involves a labor dispute, hence the RTC does
not have jurisdiction.
ISSUE:
HELD: RTC has jurisdiction. The issue does not involve a labor dispute but a civil dispute since it
concerns the non-renewal of the security agency contract. It is the regular courts and not the labor
tribunal which has jurisdiction. Also, there was no labor dispute as there is no issue involving
employment – El Toro is the employer of the security guards, not the bank.
PAL V. NLRC March 20, 1998

DOCTRINE: There can be no labor dispute if no complaint for illegal dismissal has been filed with the
Labor Arbiter. The power of NLRC to issue writ of injunction originates from any labor dispute.
FACTS: Two flight attendants from PAL were dismissed because of alleged involvement in currency
smuggling in Hong Kong.
They went directly to NLRC and filed a petition for injunction seeking PAL to withhold the dismissal
order and compel to reinstate them to work.
PAL challenged NLRC’s jurisdiction through an MR contending that the issue raises NO labor dispute.
ISSUE: WON NLRC may issue an injunction without a labor dispute?
HELD: NO. Injunction is merely a provisional remedy which is adjunct to a main suit. As “labor dispute”
is defined as “controversy” – it means that labor disputes are litigated questions.
The power of NLRC to issue injunction originates from a labor dispute. The action filed by private
respondents are in reality an action for illegal dismissal, seeking for reinstatement – and this is a matter
which belongs to the jurisdiction of the LA having original and exclusive jurisdiction over termination
cases.
SAN MIGUEL CORPORATION EMPLOYEES UNION V. June 13, 1990 (Labor dispute despite absence of
BERSAMIRA ER-EE relationship)
FACTS: Workers performing merchandising services were deployed in San Miguel under Independent
Contractors’ Agreement with 2 agencies.
Expressed in the Agreements that there would be no ER-EE relationship between these workers and
San Miguel.
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However, SMCEU (authorized representative of rank-and-files) claim that there is a “labor-only”
contracting situation because these employees have been working for San Miguel for 6 months to 15
years, performing tasks primary to the business of San Miguel.
They sought regularization of these employees.
San Miguel filed a verified petition for injunction with damages before RTC against the Union, which
was granted by RTC because of absence of ER-EE relationship.
ISSUE: WON RTC has jurisdiction over the issue.
HELD: NO. There is a labor dispute in this case, hence falls under the jurisdiction of Labor Arbiter. The
questions involved are, among others, WON there is labor-only contracting situation, WON the workers
are employees of San Miguel, WON the Union may lawfully represent workers from independent
contractors – all of which are labor-related questions, requiring application of the Labor Code and other
Labor legislations.
Although there is an absence of ER-EE relations, an issue can still be classified as labor dispute since
labor disputes are controversies concerning terms and conditions of employment… regardless of WON
the disputants stand in the proximate relation of ER-EE.
MANAGERIAL EMPLOYEES
PENARANDA V. BAGONG PLYWOOD CORP May 3, 2006 (Managerial staff exempted from
provisions of the Labor Code)
FACTS: Petitioner was hired by respondent to take charge of the operations and maintenance of its
steam plant boiler until he was terminated. He claims that he was illegally terminated, without valid
grounds, and that he was not paid his overtime pay, night shift differentials, premium pay, etc.
Respondent claims that petitioner was legally terminated from his position when the company
temporarily closed due to repair and maintenance, he was paid with separation benefits and did not
reapply when the company resumed operations. Furthermore, being a managerial employee he is not
entitled to overtime pay.
ISSUE: WON managerial staff are not entitled to OT pay.
HELD: YES. By the nature of Penaranda’s work, he is a supervisor of the steam plant boiler, and as such,
a member of the managerial staff. His work involves overseeing the machines and the performance of
workers.
Members of the managerial staff are exempted from the provisions of the Labor Code on labor
standards.
Notes: Notes re Managerial staff for easier reference:
Implementing Rules of Labor Code:
MANAGERS:
Their primary duty consists of the management of the establishment in which they are employed or of
a department or subdivision thereof; They customarily and regularly direct the work of two or more
employees therein; They have the authority to hire or fire other employees of lower rank; or their
suggestions and recommendations as to the hiring and firing and as to the promotion or any other
change of status of other employees are given particular weight.
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MANAGERIAL STAFF:
The primary duty consists of the
(i) Performance of work directly related to management policies of the employer;
(ii) Customarily and regularly exercise discretion and independent judgment;
(iii) Regularly and directly assist a proprietor or a managerial employee whose primary duty
consists of the management of the establishment in which he is employed or subdivision
thereof; or
(iv) Execute under general supervision work along specialized or technical lines requiring special
training, experience, or knowledge; or
(v) Execute under general supervision special assignments and tasks; and
(vi) Who do not devote more than 20 percent of their hours worked in a workweek to activities
which are not directly and closely related to the performance of the work described in
paragraphs (1), (2), and (3) above.
ART. 224 [217]. JURISDICTION OF LABOR ARBITER

PONDOC V. NLRC October 3, 1996
FACTS: Wife of an employee successfully claimed from employer in an illegal dismissal plus monetary
claims filed with LA.
Employer claims employee is indebted, so asked that the debt be offset. LA refused and issued
execution.
In an appeal with NLRC, offsetting was allowed and NLRC issued a writ of injunction against LA’s
decision.
ISSUE:
HELD: The writ of injunction issued by NLRC is improper because it prevented LA from executing its
decision. The writ of injunction is allowed under the NLRC Rules of Procedure but only as an ancillary
remedy in order to preserve the rights of the parties during a pendency of a case.
Jurisdiction: the employer failed to provide sufficient evidence to show that indebtedness arose from
ER-EE relationship to enable LA to exercise its jurisdiction. Further, even assuming that it falls under
juris of LA, it is deemed waived as it is an affirmative defense which was not timely raised as
counterclaim either in the answer or in a motion to dismiss.
VILLAMARIA V. CA April 19, 2006

FACTS: Boundary-Hulog scheme.
The jeepney driver filed a complaint for illegal dismissal but the employer-operator claims that the labor
courts do not have jurisdiction because what governs the relationship is the Boundary-Hulog Contract
which created only a vendor-vendee relationship.
ISSUE:
HELD: The Boundary-Hulog scheme did not terminate the ER-EE relationship but created a dual-juridical
relationship – ER-EE and VR-VE – considering that employer-owner retained ownership and control
over the jeep.
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In deciding cases before LA and NLRC, the disputes arising from an ER-EE relationship is a jurisdictional
requirement.
MENDOZA V. OFFICERS OF MANILA WATER January 25, 2016 (ULP)

EMPLOYEE’S UNION
FACTS: Petitioner, a member of respondent union, failed to pay his union dues, and was recommended
a suspension for 30 days. He claims that he was suspended and expelled from MWEU illegally as a result
of the denial of his right to appeal his case to the general membership assembly in accordance with the
union’s constitution and by-laws.
He was charged with non-payment of dues a third time.
Petitioner filed a Complaint against respondents for unfair labor practices, damages, and attorney's
fees before the NLRC. LA, NLRC, and CA dismissed for lack of jurisdiction because the matter was inter/-
intra-corporate under BLR’s jurisdiction.
ISSUE:
HELD: It is true that some of petitioner’s causes of action constitute intra-union cases cognizable by the
BLR under Article 226 of the Labor Code. An intra-union dispute refers to any conflict between and
among union members, including grievances arising from any violation of the rights and conditions of
membership, violation of or disagreement over any provision of the union’s constitution and by-laws,
or disputes arising from chartering or disaffiliation of the union.
However, petitioner’s charge of unfair labor practices falls within the original and exclusive jurisdiction
of the Labor Arbiters, pursuant to Article 217 of the Labor Code. Unfair labor practice relates to the
commission of acts that transgress the workers’ right to organize. All the prohibited acts constituting
unfair labor practice in essence relate to the workers’ right to self-organization.
ATLAS FARMS V. NLRC November 18, 2002 (Termination Dispute)

FACTS: Employees of Atlas filed for illegal dismissal before the LA.
Because there was an existing CBA between Atlas and its employee’s union, Atlas sought the dismissal
of the case on grounds that provisions on CBA regarding resolving disputes must first be exhausted.
ISSUE:
HELD: Termination disputes fall under the jurisdiction of the LA. When an ER-EE relationship has ceased
to exist, submission of termination disputes to VA is only allowed when there is express consent from
both parties. The provisions of the CBA as to dispute resolution can no longer be imposed upon the
other party as termination disputes no longer require mere application or interpretation of CBA.
NEGROS METAL V. LAMAYO August 25, 2010 (Termination Dispute)

FACTS: Illegal dismissal case but because of an existing CBA, the employer Contested the jurisdiction of
the NLRC and said that the matter must undergo grievance procedure first, as provided under the CBA.
ISSUE:
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HELD: Termination disputes are within exclusive and original juris of LA. Further, even assuming that
the disagreement herein is within the provisions of CBA, the employee in this case is not even a member
of the union.
VIVERO V. CA October 24, 2000 (Termination Dispute)

FACTS: In this case, it is the LA himself who refused to take cognizance of the case because the CBA
contains grievance machinery and voluntary arbitration provisions.
This involves a repatriated seaman who referred his illegal dismissal case to AMOSUP. Although there
was a grievance machinery conducted, no amicable settlement was reached, thus case was submitted
to LA.
Because of LA’s refusal to hear the case, the Issue on jurisdiction was raised.
ISSUE:
HELD: Termination disputes fall under the jurisdiction of the Labor Arbiter. A voluntary arbitrator can
only hear the case if there is express consent from both parties.
UNIVERSITY OF IMMACULATE CONCEPCION V. January 26, 2011 (Termination Dispute)

NLRC
FACTS: A faculty member of the Immaculate Conception filed a case for constructive dismissal when
she was suspended for 1 year after findings of 2 charges of AWOL.
After 1 year, she returned to work, but a case is already filed before LA after failure to reach an amicable
settlement during grievance machinery.
ISSUE:
HELD: No denying that issues on dismissal of an employee falls under the jurisdiction of LA, except only
when both parties agree to submit the matter to VA. If they do agree, the LA will have to dispose the
case by referring the same to appropriate VA.
In this case, the review of records from the grievance machinery would show that the parties agreed to
submit the case to VA, but LA still took cognizance of the case, which is erroneous because it should’ve
referred the matter to VA when the university contested LA’s jurisdiction.
AUSTRIA V. NLRC August 16, 1999 (Termination Dispute) (Priest)

FACTS: An illegal dismissal case filed by a Pastor of Seventh Day Adventist against the religious
corporation. The issue stemmed when he was removed from being a Pastor as consequence of offenses
he committed against other members of SDA.
SDA contested the jurisdiction of the labor courts, invoking that the matter is purely ecclesiastical in
nature, and invoking separation of state and church.
ISSUE:
HELD: The scope of our Labor Laws is wide enough to include religious corporations, and that it cannot
hide under the mantle of separation of state and church to avoid obligations to employees as employer.
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Further, raising the question of jurisdiction was raised too late by SDA as it has already fully participated
in the case before the Labor Arbiter and NLRC.
REYES V. RTC MAKATI BRANCH 42 August 11, 2008 (Termination Dispute)

FACTS: This is a case where the court made a ruling on how to determine if an issue is an intra-corporate
dispute.
An heir to a stockholder filed a complaint before the SEC seeking to obtain the accounting of funds of
the corporation to determine the shares of stocks of the deceased, which was allegedly
misappropriated.
The jurisdiction of the regular court sitting as a special commercial court is contested because the
matter is NOT an intra-corporate dispute but one of settlement of estate.
ISSUE:
HELD: The Court applied the two-tiered test: (1) Relationship Test and (2) Nature of the Controversy
Test.
The relationship test was not satisfied because petitioner is yet a stockholder (dapat daw dispute
stockholder v stockholder, etc.) since there is no settlement of estate yet, no rights were transferred to
him yet.
The nature of controversy test is also not satisfied because although captioned as demand for
accounting of the corporation, the true nature of the case is settlement of estate.
LOCSIN V. NISSAN LEASE PHILIPPINES October 20, 2010 (Intracorporate Dispute)

FACTS: Petitioner ARSENIO LOCSIN was elected as Executive Vice President and Treasurer of NISSAN
LEASE PHILIPPINES INC. (NCLPI). Locsin held this position for 13 years until 2005, when he was
nominated and elected Chairman of NCLPI's Board of Directors. 7 months after his election, Locsin was
neither re-elected Chairman nor reinstated to his previous position as EVP/Treasurer.
Locsin filed a complaint for illegal dismissal with prayer for reinstatement, before the Labor Arbiter
against NCLPI and Banson, who was then President of NCLPI.
NCLPI filed a Motion to Dismiss based on lack of jurisdiction.
LA denied Motion to Dismiss. NCLPI filed a petition for certiorari under Rule 65 in the Court of Appeals.
CA reversed and set aside LA’s decision and hold that Locsin was a corporate officer. The issue of his
removal as EVP/Treasurer is an intra-corporate dispute under the RTC's jurisdiction.
ISSUE: Whether the Labor Arbiter did not have jurisdiction over the case since the issue of removal of
corporate officer, whether elected or appointed, is an intra-corporate dispute within the JD of regular
courts? Yes. Labor Arbiter has no jurisdiction.
HELD: Given Locsin's status as a corporate officer, the RTC, not the Labor Arbiter or the NLRC, has
jurisdiction to hear the legality of the termination of his relationship with Nissan. As we also held in
Okol, a corporate officer's dismissal from service is an intra-corporate dispute.
NOTE: procedural issue. NCLPI incorrectly elevated the Labor Arbiter's denial of the Motion to Dismiss
to the CA. The denial of a motion to dismiss is unappealable. However, the Court gave precedence to
the merits of the case, and primacy to the element of jurisdiction. In the context of the present case,
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the Labor Arbiter does not have jurisdiction over the termination dispute Locsin brought, and should
not be allowed to continue to act on the case after the absence of jurisdiction has become obvious,
based on the records and the law.
WESLAYAN UNIVERSITY V. MAGLAYA January 23, 2017 (Termination Dispute)

FACTS: Maglaya was both a corporate member and a trustee, and also the appointed as President of
Wesleyan University. Several memberships, including that of Maglaya, expired in 2008, but despite
signifying his willingness to renew the same, a new set of corporate members and trustees were
appointed, and accordingly, they have elected new set of officers – Maglaya excluded.
Maglaya then filed an illegal dismissal case against Wesleyan before the LA. Wesleyan University moved
for the dismissal of the complaint on the ground that Maglaya is not a mere employee but a corporate
officer. Hence, issue relating to his employment is an intra-corporate controversy which falls under the
jurisdiction of the regular courts and not of labor tribunals.
Maglaya insists that he is an employee since he was not “elected” as president but was “appointed”.
ISSUE: WON the issue involves an intra-corporate controversy to which the LA has no jurisdiction.
HELD: Intra-corporate controversy. The regular courts have jurisdiction. A corporate officer's dismissal
is always a corporate act, or an intra-corporate controversy which arises between a stockholder/officer
and a corporation.
To be considered as “corporate office”, it is required that (1) the position must be created by the
corporate charter or by-laws, and (2) the directors or stockholders must “elect” the said officer.
It is apparent from the By-laws of WUP that the president was one of the officers of the corporation.
The alleged "appointment" of Maglaya instead of "election" as provided by the by-laws neither convert
the president of university as a mere employee, nor amend its nature as a corporate officer. Here,
Maglaya was appointed by the Board and not by a managing officer of the corporation.
CACHO V. BALAGTAS February 7, 2018 (Termination Dispute)

FACTS: The EVP of North Star filed a complaint for constructive dismissal before the Labor Arbiter when
she was suspended for a period of 30 days.
North Star contended that no dismissal happened because she was only being suspended while
investigations regarding her anomalous transactions as EVP without prior approval of the Board is
ongoing.
North Star also contested the jurisdiction of the LA contending that EVP is a corporate officer, and thus,
issue concerns intra-corporate disputes under the jurisdiction of RTC.
Balagtas claims that she holds EVP as mere title since she is still under direction of President/CEO.
ISSUE:
HELD: Balagtas is a corporate officer because applying the relationship test:
1. Her position is created through by laws of the company;
2. She was appointed to the position by the Board, as evidenced by Board Resolution and
Secretary’s Certificate.
And applying the nature of the controversy test - the dismissal is against a corporate officer.
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To be considered an intra-corporate controversy, the dismissal of a corporate officer must have
something to do with the duties and responsibilities attached to his/her corporate office or done in his
official capacity.
PAREDES V. FEED THE CHILDREN PHILIPPINES September 9, 2015 (Damages)

FACTS: FTCP employees signed a petition letter expressing their complaints against alleged practices of
petitioner, to wit: seeking exemption from policies; withholding organization funds; procuring health
insurance for herself, etc.
The Board resolved to suspend petitioner because of her indifferent attitude and unjustified refusal to
submit to an audit. Before it could be implemented, respondent FTCP received her resignation letter.
Petitioner filed a Complaint for illegal dismissal, claiming that she was forced to resign, thus, was
constructively dismissed. Respondents alleged that petitioner voluntarily resigned from her position.
LA: for respondents; NLRC: reversed; CA for respondents
Petitioner alleged that the CA erred when it ruled that she should pay respondents' claims for damages.
She maintained that they were not duly proven and that they did not arise from an employer-employee
relationship.
ISSUE: W/N the claims for damages have reasonable causal connection with any of the claims provided
for in Article 217.
HELD: NONE. The "money claims of workers" referred to in Article 217 of the Labor Code embraces
money claims which arise out of or in connection with the employer-employee relationship, or some
aspect or incident of such relationship. This claim is distinguished from cases of actions for damages
where the employer-employee relationship is merely incidental and the cause of action proceeds from
a different source of obligation.
The fact that the transaction happened at the time they were employer and employee did not negate
the civil jurisdiction of trial court. Hence, it is erroneous for the LA and the CA to rule on such claim
arising from a different source of obligation and where the employer-employee relationship was merely
incidental.
LUNZAGA V. ALBAR SHIPPING April 18, 2012 (Damages)

FACTS: Heirs of a deceased seaman (present wife and children from previous void marriage) have
dispute over who are entitled to Lunzaga’s employment benefits.
A claim for these benefits were filed by his wife before LA but children intervened.
The LA referred the matter to RTC to determine who has better rights among the heirs.
ISSUE:
HELD: The LA is correct in directing the heirs to litigate the matter before the ordinary courts, however,
the case also involves the question of WON the employer is liable to pay for the monetary benefits
being claimed by the heirs. This is a monetary claim which arises from ER-EE relationship, and thus falls
under the jurisdiction of the LA.
SANTOS V. SERVIER PHILIPPINES INC. November 28, 2008 (Tax Deduction) (Damages)
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FACTS: Petitioner in coma while in Paris. Her expenses were paid by employer.
When she went back to PH, expenses were still paid by her employer for her rehabilitation. Since the
doctor advised that she hasn’t recovered, she was offered a retirement plan of 1M. Only 700k was
released.
On behalf of Santos, her husband filed a complaint before LA to claim the rest of the 1M. According to
the respondent, the 300k was paid to taxes.
LA ruled they do not have jurisdiction.
ISSUE:
HELD: The issue is within jurisdiction of LA because it involves illegal deductions from retirement
benefits. The issue of tax deductions is intertwined with the main issue of WON the benefits have been
fully given to Santos - a claim arising from ER-EE relationship.
WORLD’S BEST GAS V. VITAL September 9, 2015 (Damages)

FACTS: Vital was an incorporator of the petitioner (WBGI) and in a separate venture, outsourced gas
from WBGI and sold it in his other business. He owed WBGI P923,843.59.
Upon his mandatory retirement, after offsetting his shares of stocks against P923,843.59, Vital claimed
that the unpaid salaries and separation pay due him amounted to P845,000.00 and P250,000.00,
respectively, leaving a net amount of P671,156.41 payable to him.
WBGI rejected his claim and contended that after offsetting, Vital actually owed it P369,156.19.
Mr. Vital filed a complaint for non-payment of separation and retirement benefits, underpayment of
salaries/wages and 13th month pay, illegal reduction of salary and benefits, and damages.
WBGI averred that LA has no jurisdiction over the complaint having no existing employer-employee
relationship between the parties, and that Mr. Vital is a mere incorporator and stockholder
LA: Intracorporate in nature
RTC and CA: Employee
ISSUE:
HELD: RTC’s adjudication of the first cause of action was improper since the same is one which arose
from Vital and WBGI’s employer-employee relations, involving an amount exceeding P 5,000.00, hence,
belonging to the jurisdiction of the labor arbiters pursuant to Article 217 of the Labor Code.
HALAGUENA V. PAL October 2, 2009 (Damages)

FACTS: Female flight attendants sought to nullify the compulsory retirement provision in the CBA,
claiming it is discriminatory.
They filed a civil action for issuance of injunction and TRO.
PAL contested the jurisdiction of RTC claiming that the case involves labor dispute, hence, cognizable
by labor courts.
ISSUE:
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HELD: The subject matter of the case is not a labor dispute but a civil action incapable of pecuniary
estimation, falling under the exclusive and original jurisdiction of the RTC.
Application of laws other than Labor laws will be required to resolve the issue on discriminatory nature
of the CBA provision.
PEPSI COLA V. GAL-LANG September 24, 1991 (Damages)

FACTS: Pepsi filed a criminal complaint against respondent employees for Theft. This was dismissed by
the Court for lack of sufficient evidence.
Pepsi terminated the employment of the respondents.
Respondents filed a complaint for illegal dismissal. A separate civil action was filed before the RTC for
the malicious filing of criminal complaint against them.
Pepsi contested RTC’s jurisdiction.
ISSUE:
HELD: The civil action was properly filed in RTC. Not all ER-EE disputes are within the labor courts’
jurisdiction. There must be reasonable causal connection between the dispute and the relations. Here,
the civil action arises from the malicious filing of a criminal complaint for theft, which has no connection
with their employment with Pepsi since it can arise even absent their employment.
BANEZ V. VALDEVILLA May 9, 2000 (Damages)

FACTS: More than a year after the finality of the illegal dismissal case filed by petitioner against private
respondent, the latter filed a case for actual damages against the former before the RTC.
Petitioner contested the jurisdiction of the RTC, claiming that NLRC has the exclusive original
jurisdiction.
ISSUE: WON the RTC has jurisdiction over the case for actual damages.
HELD: NO. The Labor Arbiter has jurisdiction because:
Private respondent’s claim against petitioner for actual damages arose from a prior employer-
employee relationship (the damages claimed were caused by petitioner’s acts as a manager).
To allow the RTC to proceed with the case would be to open anew the factual issue duly raised and
ruled upon in the prior illegal dismissal case. The issue of actual damages has been settled in the labor
case, which is not final and executory.
Private respondent’s remedy is not in the filing of this separate action for damages, but would have
been in properly perfecting an appeal from the LA’s decision.
MILAN V. NLRC February 4, 2015 (Damages)

FACTS: This case involves a claim by employer against its employees, which caused it to withhold their
separation pay.
SMI granted housing benefits to selected employees. When it closed down business, it demanded its
employees to return the property first before the company release their separation pay.
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Petitioners refused and filed a complaint before LA for SMI’s unlawful withholding of their last pay. That
the return of the property cannot be a precondition to the release of last pay as it was not granted to
them due to their employment but merely out of liberality.
ISSUE:
HELD: The issue involved is within the jurisdiction of NLRC because the claim is one by employer against
employees. The monetary claims under the jurisdiction of the labor courts are not limited to those of
one claimed by employees.
The argument of the employees that determination of their prolonged stay in the premises was an issue
to be resolved by RTC is not correct since NLRC also has jurisdiction to determine preliminary issues
relating to rights of employers and employees in order to determine the liabilities for claims made.
AMECOS INNOVATIONS V. LOPEZ July 2, 2014 (Damages)

FACTS: SSS CONTRIBUTIONS paid by Amecos but not withheld from Lopez’ salary.
Amecos now claims for reimbursement from Lopez, but he refused.
A complaint for a claim was filed before LA. Lopez contended that the LA has no jurisdiction since the
issue involves question of violations of SSS Law.
ISSUE:
HELD: LA has jurisdiction. As far as SSS is concerned, no issue is existing. The issue is a claim initiated by
an employer against its employee arising from ER-EE relationship because if he is not an employee of
Amecos, the latter wouldn’t have advanced the payment of SSS contributions.
PAL V. ALPAP February 26, 2018 (Damages)

FACTS: PAL filed a complaint for damages against its employees who staged a strike and abandoned
their posts despite order from the SOLE not to proceed with the strike.
LA dismissed the complaint on the grounds that the basis of the claims is Torts - for the damages and
costs incurred due to cancelled flights.
ISSUE: WON the NLRC and the Labor Arbiter have jurisdiction over PAL's claims against the respondents
for damages incurred as a consequence of the latter's actions during the illegal strike. – Yes
HELD: The case falls under the jurisdiction of the labor courts. The damages being claimed were due to
the illegal strike conducted, hence there is a reasonable causal connection between the claims and the
existence of ER-EE relations.
DAI-CHI ELECTRONICS V. VILLARAMA November 21, 1994 (Damages)

FACTS: Petitioner filed a complaint for damages against respondent claiming that the respondent
became an employee of a competitor within two years from the date of respondent’s resignation,
which is a violation of their contract.
RTC ruled that it had no jurisdiction because the complaint was for damages arising from employer
employee relations.
ISSUE: WON the petitioner’s claim for damages arises from EER – NO
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HELD: Claims for damages under paragraph 4 of Article 217, to be cognizable by the Labor Arbiter, must
have a reasonable causal connection with any of the claims provided for in that article. Petitioner does
not ask for any relief under the Labor Code. It seeks to recover damages agreed upon in the contract as
redress for private respondent’s breach of his contractual obligation to its “damage and prejudice” Such
cause of action is within the realm of Civil Law, and jurisdiction over the controversy belongs to the
regular courts.
PEOPLE’S BROADCASTING SERVICE V. SEC OF March 6, 2012 (DOLE Can Determine Existence
LABOR Of EE Rel And Summary On Articles 128, 129 And
224) (Bombo Radyo case)
FACTS: In this case, the DOLE’s power to determine the existence of ER-EE relationship was questioned.
In the exercise of DOLE’s visitorial powers, it found that Bombo Radyo has violated provisions of labor
standards, thus holding it liable for claims instituted by one of its employee.
In concluding this decision, DOLE first confirmed the existence of ER-EE relationship, then proceeded
to issue enforcement orders in relation to violations of LabStan.
ISSUE:
HELD: The DOLE’s expanded visitorial powers under RA 7730 grants it the power to determine (in the
preliminary) the existence of ER-EE relationship so that it can proceed to issue enforcement orders. The
NLRC retains exclusive original jurisdiction over the questions of ER-EE existence, but if the
determination is required so that DOLE may fully exercise its visitorial powers, then the issue shall be
taken up by DOLE to the exclusion of NLRC.
EX-BATAAN VETERANS SECURITY AGENCY V. SEC. November 20, 2007 (In Relation To Articles 128
LAGUESMA And 129)
FACTS: Upon a complaint filed before DOLE Regional Office for underpayment of wages, DOLE
conducted a complaint investigation and found out that petitioner violated several provisions of the
Labor Standards law.
A summary hearing was conducted and as result, RD ordered petitioner to pay the amount being
claimed.
Petitioner contested the jurisdiction of DOLE to take cognizance over monetary claims when it
should’ve been referred to NLRC since the individual claims are more than 5k.
ISSUE:
HELD: Under RA 7730, the visitorial and enforcement powers of DOLE is expanded such that SOLE is
now authorized to hear and decide in a summary proceeding any matter involving recovery of any
amount of wages or claims out of ER-EE relations ate the time of inspection. Except only if employer
contests the findings of SOLE and requires evidentiary matters to be inspected, which were not
apparent or could not have been considered at the time of inspection, then the matter will have to be
referred to NLRC.
METEORO V. CREATIVE CREATURES July 13, 2009 (In Relations To Articles 128 And
129)
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FACTS: CREATIVE primarily caters to the production design requirements of ABS-CBN. CREATIVE Hired
the petitioners as artists, carpenters and welders to design, create, assemble, set-up and dismantle
props of production sets.
Petitioner filed complaints for non-payment of benefits and illegal deductions with DOLE.
During investigation, the labor inspector noted that the records were not made available, and that
creative claimed that DOLE had no jurisdiction because of the absence of EER since petitioners were
free-lance individuals.
Petitioners filed a complaint for illegal dismissal with payment with the NLRC. RD ordered Creative to
pay money claims. DOLE SECRETARY AFFIRMED. CA declared the decision null and void.
ISSUE: WON the DOLE was divested of jurisdiction, i.e., the case falls within the exception clause in art
128(b). – YES
HELD: “Exception clause” has the following elements, all of which must concur: (a) that the employer
contests the findings of the labor regulations officer and raises issues thereon; (b) that in order to
resolve such issues, there is a need to examine evidentiary matters; (c) that such matters are not
verifiable in the normal course of inspection.
In this case It is clear that respondent contested and continues to contest the findings and conclusions
of the labor inspector. The Regional Director was divested of jurisdiction and should have endorsed the
case to the appropriate Arbitration Branch of the NLRC.
OKOL V. SLIMMERS WORLD December 11, 2009

FACTS: Okol was hired as management trainee but over time, rose to the position of Vice President.
She filed an illegal dismissal case before LA but Slimmers World contested the jurisdiction alleging that
it is an intra-corporate dispute since it involves a corporate officer.
ISSUE: Whether or not NLRC have jurisdiction over the illegal dismissal case filed by petitioner. – No
HELD: Questions of remuneration involving a corporate officer and stockholder is not a simple problem
but a matter of corporate affairs and management giving rise to a corporate controversy in
contemplation of the Corporation Code. The RTC has jurisdiction.
SANTIAGO V. CF SHARP CREW MANAGEMENT July 10, 2007 (OFW)

FACTS: Paul Santiago signed a new contract of employment with CF Sharp Crew Mgmt., Inc., with the
duration of nine (9) months. He was to be deployed on board the “MSV Seaspread” which was
scheduled to leave the port of Manila for Canada.
A week before the scheduled date of departure, the CF Sharp’s VP, sent a fax to the captain of “MSV
Seaspread” that he received calls from various individuals about the possibility that Santiago may jump
ship in Canada like his brother did before him. Santiago was thus told that he would not be leaving
anymore, but he was reassured that he might be considered for deployment at some future date.
Santiago filed a complaint for illegal dismissal, damages, and attorney's fees. CF Sharp contends that
there is no ER-EE relationship between petitioner and respondent because under the POEA Standard
Contract, the employment contract shall commence upon actual departure of the seafarer from the
airport or seaport at the point of hire.
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ISSUE: Whether or not the failure of CF Sharp to deploy Santiago without a valid contract entitles the
latter to relief sought despite the non-commencement of the employer-employee relationship. – Yes
HELD: The jurisdiction of labor arbiters is not limited to claims arising from employer-employee
relationships. Under Section 10 of R.A. No. 8042 the Labor Arbiters of the NLRC shall also have the
original and exclusive jurisdiction to hear and decide, the claims arising xxx by virtue of any law or
contract involving Filipino workers for overseas deployment including claims for actual, moral,
exemplary and other forms of damages.
INDUSTRIAL PERSONNEL AND MANAGEMENT March 7, 2016 (OFW)

SERVICES V. DE VERA
FACTS: Respondent is a surgeon who was hired and deployed to Canada. Just 3 months after he
commenced work, he was repatriated because of decline of work in his area of expertise.
His separation pay was in the amount sufficient under Canadian Law. He filed a complaint before LA
against IPAMS (the agency who deployed him) for payment of the remaining remuneration due him
under the PH laws.
According to De Vera, he signed the contract in the Philippines, and the contract was processed by
POEA.
ISSUE: Whether or not the foreign law should govern the present overseas employment contract. – No
HELD: The general rule is that Philippine laws apply even to overseas employment contracts.
As an exception, the parties may agree that a foreign law shall govern the employment contract. There
are 4 requisites to apply a foreign law in a contract, and the 1st requisite is missing in this case, thus De
Vera is entitled to additional benefits under PH Law.
1. Expressly provided in the contract that foreign law will govern;
2. The law is proven before PH courts;
3. The law is not contrary to LAMOGPUPU of PH; and
4. Contract has been processed by POEA.
ACE NAVIGATION V. FERNANDEZ October 10, 2012 (OFW)

FACTS: Seaman Fernandez filed with the NLRC a complaint for disability benefits, with prayer for moral
and exemplary damages, plus attorney’s fees, against petitioners.
The petitioners moved to dismiss the complaint, contending that the labor arbiter had no jurisdiction
over the dispute.
Fernandez opposed and argued that inasmuch as his complaint involves a money claim, original and
exclusive jurisdiction over the case is vested with the labor arbiter.
ISSUE: Who has the original and exclusive jurisdiction over Fernandez’s disability claim — the labor
arbiter under Section 10 of R.A. No. 8042, as amended, or the voluntary arbitration mechanism as
prescribed in the parties’ CBA and the POEA-SEC?
HELD: The voluntary arbitrator or panel of voluntary arbitrators has original and exclusive jurisdiction
over Fernandez’s disability claim. The Court cited Section 3, Article XIII of the Constitution on Social
Justice and Human Rights, Articles 260 (Grievance machinery and voluntary arbitration), 261
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(Jurisdiction of Voluntary Arbitrators or panel of Voluntary Arbitrators) and 262 (Jurisdiction over other
labor disputes).
Also, the POEA-SEC, which governs the employment of Filipino seafarers, provides in its Section 29 on
Dispute Settlement Procedures:
In cases of claims and disputes arising from this employment, the parties covered by a collective
bargaining agreement shall submit the claim or dispute to the original and exclusive jurisdiction of the
voluntary arbitrator or panel of voluntary arbitrators.
The claim arose out of Fernandez’s employment with the petitioners and that their relationship is
covered by a CBA — the AMOSUP/TCC or the AMOSUP-VELA CBA.
It is settled that when the parties have validly agreed on a procedure for resolving grievances and to
submit a dispute to voluntary arbitration then that procedure should be strictly observed.
ESTATE OF NELSON DULAY V. ABOITIZ JEBSEN (OFW)

MARITIME
FACTS: Nelson Dulay was employed by GCI, a subsidiary of Aboitiz Jebsen Maritime Inc. 25 days after
the completion of his employment contract, Nelson died due to acute renal failure.
He was a member of the Associated Marine Officers and Seaman’s Union of the Philippines (AMOSUP),
GCI’s collective bargaining agent.
Nelson’s widow, Merridy Jane, claimed for death benefits through the grievance procedure of the CBA.
Petitioners refused to grant the benefits. Merridy Jane filed a complaint with the NLRC against GCI for
death and medical benefits and damages.
Respondents asserted that the NLRC had no jurisdiction on account of the absence of employer-
employee relationship between GCI and Nelson at the time of the latter’s death. They alleged that
petitioners are only liable "in case of death of the seafarer during the term of his contract pursuant to
the POEA contract".
ISSUE:
HELD: The CBA is the law or contract between the parties. The CBA entered into by GCI and AMOSUP
provides that in case of dispute in the interpretation of the CBA, or enforcement of company policies,
it shall be settled through negotiation, conciliation or voluntary arbitration. In addition, the present
Omnibus Rules and Regulations Implementing the Migrant Workers and Overseas Filipinos Act of 1995,
states that "[f]or OFWs with collective bargaining agreements, the case shall be submitted for voluntary
arbitration in accordance with Articles 261 and 262 of the Labor Code." Hence, with respect to disputes
involving claims of Filipino seafarers wherein the parties are covered by a collective bargaining
agreement, the dispute or claim should be submitted to the jurisdiction of a voluntary arbitrator or
panel of arbitrators. It is only in the absence of a collective bargaining agreement that parties may opt
to submit the dispute to either the NLRC or to voluntary arbitration.
LRTA V. ALVAREZ November 18, 2016 (Related To GOCC)

FACTS: LRTA entered into a contract with METRO for management and operations of LRT. Eventually,
the contract was nullified due to COA’s investigations and findings. LRTA then decided to acquire
METRO.
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LRTA eventually stopped operations of METRO. METRO was only able to release 50% of the pay due to
its employees.
The employees filed a complaint against LRTA, being the principal of METRO, for payment of the
balance.
LRTA invoked non-suability before NLRC as it is a Governmental entity (GOCC).
ISSUE:
HELD: No dispute that complainants are employees of METRO. However, METRO’s employer
obligations arose from the business transacted with LRTA, which is not a government function. This
made LRTA an indirect employer, solidarily liable to the claimants.
GSIS V. NLRC November 17, 2010 (Related To GOCC)

FACTS: Private respondents Bansalan et al. were employed as security guards by DNL Security.
Respondents were assigned to GSIS Tacloban office pursuant to the service contract entered into by
GSIS and DNL.
After almost 15 years, DNL informed respondents that the service contract was terminated but still
instructed respondents to continue reporting for work to GSIS. They worked despite not receiving
wages, then they were terminated.
Respondents filed with the NLRC a complaint against DNL. LA ordered DNS and GSIS solidarily liable to
pay salary differential. GSIS claims the decision cannot be enforced because petitioner’s charter
exempts them from execution.
ISSUE: Whether the decision of the LA can be enforced against the GSIS?
HELD: The fact that there is no actual and direct employer-employee relationship between petitioner
and respondents does not absolve the former from liability for the latter’s monetary claims. When
petitioner contracted DNL Security’s services, petitioner became an indirect employer of respondents,
pursuant to Article 107 of the Labor Code. The exemption should be limited to the purposes and objects
covered by the charter. Petitioner’s charter should not be used to evade its liabilities to its employees,
even to its indirect employees, as mandated by the Labor Code.
DUTY FREE PHILS. V. MOJICA September 30, 2005 (Related To GOCC)

FACTS: Stock clerk Mojica was found guilty of neglect of duty by the Discipline Committee by causing
damage to materials and assets of Duty Free. He was forced to resign from service. He filed a complaint
of illegal dismissal with prayer of reinstatement against Duty Free before the NLRC.
ISSUE:
HELD: Mojica is a civil service employee, therefore jurisdiction is with the CSC. Duty Free Phils. was
created under EO 45 to augment the facilities for tourists and generate revenue for the government.
All net profits from duty free shops accrued to the Dept. of Tourism (DOT).
WPP MARKETING COMUNICATIONS V. GALERA March 25, 2010 (With Foreign Element)
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FACTS: Jocelyn Galera, an American citizen, was recruited from the U.S. by private respondent John
Steedman, Chairman of WPP Worldwide, a corporation based in Hong Kong, China, to work in the
Philippines for private respondent WPP.
After some months, WPP filed before the Bureau of Immigration an application for Galera's working
visa, wherein she was designated as Vice President of WPP. Note, however, that the by-laws of WPP
only provides for one Vice President and at the time of her supposed appointment, there was already
a Vice President.
Later on, Galera was verbally notified by Steedman that her services with private respondent WPP had
been terminated. A termination letter followed the next day imputing incompetence. Aggrieved, Galera
filed a complaint for illegal dismissal before the Labor Arbiter. For its defense, WPP argued that the
Labor Arbiter has no jurisdiction over the case since Galera, being a Vice President, was a corporate
officer (thus, the case should have been filed before the RTC).
ISSUE:
HELD: The Labor Arbiter has jurisdiction; Galera is not a corporate officer. Corporate officers are given
such character either by the Corporation Code or by the corporation's by-laws Under Section 25 of the
Corporation Code, the corporate officers are the president, secretary, treasurer and such other officers
as may be provided in the by-laws. Other officers are sometimes created by the charter or by-laws of a
corporation, or the board of directors may be empowered under the by-laws of a corporation to create
additional offices as may be necessary. While Galeras was indeed appointed as Vice President during a
special meeting of WPP’s Board of Directors, the by-laws of WPP provides for only one Vice President.
At the time of her appointment, there was already a Vice President. Her appointment therefore is an
appointment to a non-existent corporate office.
PAKISTAN INTERNATIONAL AIRLINES V. OPLE September 28, 1990 (With Foreign Element)
(Jurisdiction of LA over disputes involving alien
parties; when Philippine Law Prevails)
FACTS: Petitioner "PIA", executed in Manila two (2) separate contracts of employment, one with private
respondent Ethelynne B. Farrales and the other with private respondent Ma. M.C. Mamasig.
Par. 5 - duration of employment, Par. 6 - termination, Par. 10 of the agreement provides that (1) it shall
be construed and governed under and by the laws of Pakistan, and (2) only the Courts of Karachi,
Pakistan shall have the jurisdiction to consider any matter arising out of or under the agreement.
Roughly (1) year and (4) months prior to the expiration of the contracts of employment, both private
respondents were advised that their services as flight stewardesses would be terminated.
Farrales and Mamasig jointly instituted a complaint for illegal dismissal and non-payment of company
benefits and bonuses, against PIA with the then Ministry of Labor and Employment ("MOLE").
ISSUE: May petitioner invoke the second clause of paragraph 10, specifying the Karachi courts as the
sole venue for the settlement of disputes arising from the agreement? – No.
Which court has jurisdiction over the dispute, Ph Courts or Courts of Karachi, Pakistan? – In this case,
Ph juris was upheld.
HELD: “The first clause of paragraph 10 cannot be invoked to prevent the application of Philippine labor
laws and regulations to the subject matter of this case, i.e., the employer-employee relationship
between petitioner PIA and private respondents. We have already pointed out that the relationship is
much affected with public interest and that the otherwise applicable Philippine laws and regulations
4F 2021-2022 17
cannot be rendered illusory by the parties agreeing upon some other law to govern their relationship.
Neither may petitioner invoke the second clause of paragraph 10, specifying the Karachi courts as the
sole venue for the settlement of dispute; between the contracting parties. Even a cursory scrutiny of
the relevant circumstances of this case will show the multiple and substantive contacts between
Philippine law and Philippine courts, on the one hand, and the relationship between the parties, upon
the other: the contract was not only executed in the Philippines, it was also performed here, at least
partially; private respondents are Philippine citizens and respondents, while petitioner, although a
foreign corporation, is licensed to do business (and actually doing business) and hence resident in the
Philippines; lastly, private respondents were based in the Philippines in between their assigned
flights to the Middle East and Europe. All the above contacts point to the Philippine courts and
administrative agencies as a proper forum for the resolution of contractual disputes between the
parties. Under these circumstances, paragraph 10 of the employment agreement cannot be given
effect so as to oust Philippine agencies and courts of the jurisdiction vested upon them by Philippine
law. Finally, and in any event, the petitioner PIA did not undertake to plead and prove the contents of
Pakistan law on the matter; it must therefore be presumed that the applicable provisions of the law of
Pakistan are the same as the applicable provisions of Philippine law.”
PNB V. CABANSAG June 21, 2005 (With Foreign Element)

FACTS: Cabansag went to Singapore as tourist and there, she applied for employment with SG branch
of PNB.
When she was accepted for employment, she filed an Application with Ministry of Manpower of SG for
the issuance of employment pass.
Tobias was satisfied with Cabansag’s work performance and annotated on her performance report
“good work”. However, that evening, Cabansag was told to resign and such was imperative as a cost-
cutting measure of the Bank. Cabansag refused and did not submit any letter of resignation.
for failure to submit such resignation letter, Cabansag received letter from Tobias terminating her
employment.
ISSUE: WON arbitration branch of NLRC in NCR has jurisdiction over the instant controversy?
HELD: YES. The jurisdiction of LA and NLRC is provided in Art. 224. moreover, it is provided for in S.10
RA 8042 that labor arbiters have original and exclusive jurisdiction over claims arising from EE-ER
relations, including termination disputes involving ALL workers, among whom are OFWs. The permit
obtained by Cabansag in SG does not imply a waiver of ones national laws on labor. Such permit simply
means that its holder has a legal status of a worker in the issuing country. She is considered an OFW
who was covered by Ph Labor Laws upon certification of the POEA. As such, it is her option to choose
the venue of her complaint for illegal dismissal -- the law gives her 2 choices: 1) Regional Arbitration
Branch (RAB) where she resides; or 2) RAB where the principal office of her employer is situated.
MANILA HOTEL V. NLRC October 13, 2000 (With Foreign Element)

FACTS: Private respondent was an OFW in Oman when he was referred to Palace Hotel in China. He
accepted the position and resigned from his job in Oman.
Petitioner is the company that trains employees to be deployed in Oman.
After just few months of working, he was repatriated. He filed a complaint for illegal dismissal.
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He sued petitioner Before the LA which refused to take cognizance of the case.
ISSUE:
HELD: Courts of PH may refuse to take cognizance of the case if it is not a convenient forum. We note
that the main aspects of the case transpired in two foreign jurisdictions and the case involves purely
foreign elements. The only link that the Philippines has with the case is that respondent Santos is a
Filipino citizen. The Palace Hotel and MHICL are foreign corporations. Not all cases involving our citizens
can be tried here.
Neither can an intelligent decision be made as to the law governing the employment contract as such
was perfected in foreign soil. This calls to fore the application of the principle of lex loci contractus (the
law of the place where the contract was made).
SAUDI ARABIAN AIRLINES V. REBESENCIO January 14, 2015 (With Foreign Element)
FACTS: Female Filipino flight attendants filed a complaint for constructive dismissal before the LA for
being forced to resign from SAUDIA because of their pregnancy. According to them, they validly filed
maternity leave before they were informed that they will have to resign or they will be terminated.
Saudia contested the jurisdiction of PH courts on the ground of Forum Non Conveniens.
ISSUE:
HELD: The defense of forum non conveniens finds no application in this case. Saudia simply invokes this
doctrine to enforce the provision in its uniform contract, which this Court finds to be baseless and
discriminatory.
Based on lex loci intentionis, to the extent that it is proper and practicable, the PH law may apply foreign
laws, but even applying Saudi Arabia’s law, it is not allowed that women be terminated from
employment when they take maternity leave.
CONTINENTAL MICRONESIA V. BASCO September 23, 2015 (With Foreign Element)

FACTS: Petitioner Continental Micronesia, Inc. (CMI) is a foreign corporation. Basso is the General
Manager of the Philippine Branch of Continental. He received a letter informing him that he will only
work as a consultant on an “as needed basis”.
Basso filed a Complaint for Illegal Dismissal with Moral and Exemplary Damages against CMI. CMI filed
a Motion to Dismiss15 dated February 10, 1997 on the ground of lack of jurisdiction over the person of
CMI and the subject matter of the controversy.
ISSUE:
HELD: The labor tribunals had jurisdiction over the parties and the subject matter of the case.
That the employment contract of Basso was replete with references to US laws, and that it originated
from and was returned to the US, do not automatically preclude our labor tribunals from exercising
jurisdiction to hear and try this case.
This case stemmed from an illegal dismissal complaint. The Labor Code, under Article 217, clearly vests
original and exclusive jurisdiction to hear and decide cases involving termination disputes to the Labor
Arbiter. Hence, the Labor Arbiter and the NLRC have jurisdiction over the subject matter of the case.
4F 2021-2022 19
As regards jurisdiction over the parties, the Labor Arbiter acquired jurisdiction over the person of Basso,
notwithstanding his citizenship, when he filed his complaint against CMI. On the other hand, jurisdiction
over the person of CMI was acquired through the coercive process of service of summons.
KAWACHI ET. AL. V. DEL QUERO March 27, 2007 (Reasonable Causal Connection
Rule)
FACTS: Respondent was a clerk in a pawnshop owned by the petitioner. She was allegedly terminated
from work after an incident wherein petitioner shouted at her in front of many people because of the
way she treated the customers in the pawnshop.
Respondent filed an action for illegal dismissal before NLRC and also a claim for moral damages before
MeTC due to the embarrassment she suffered.
Kawachi moved to dismiss the complaint on the grounds of lack of jurisdiction.
ISSUE: WON MeTC has jurisdiction over the damages case.
HELD: Applying the reasonable causal connection rule, the case before MeTC should be dismissed as
the claim for damages arises from the ER-EE relationship between Kawachi and Del Quero. Filing an
independent civil action is not allowed where there is reasonable connection to her termination from
employment. The action for damages still belongs to Labor Arbiter’s jurisdiction.
PERPETUAL HELP CREDIT COOPERATIVE INC. V. October 8, 2001 (In Relation to Cooperatives)
FABURADA
FACTS: Respondents Faburada, et al. filed a complaint against petitioner Perpetual Help Credit Coop,
Inc. for illegal dismissal, premium pay on holidays and rest days. separation pay, wage differential,
moral damages, and attorney’s fees.
Petitioner Perpetual Help filed a motion to dismiss on the ground that there is no EER between them
as Faburada, et al. are all members and co-owners of the cooperative. That the latter were merely
“volunteer workers” of the coop. Thus, not being regular employees, Faburada, et al. cannot sue
Perpetual Help.
ISSUE: WON the dispute is within the original and exclusive jurisdiction of the LA? Yes.
HELD: There is no evidence that respondents are members of Perpetual Help, and even if they are, the
dispute is about payment of wages, overtime pay, rest day and termination of employment. Under Art
217 of the LC, these disputes are within the original and exclusive jurisdiction of the Labor Arbiter.
7K CORP. V. ALBANCO June 26, 2013

FACTS: Respondent Eddie Albarico (Albarico) was a regular employee of petitioner 7K Corporation, a
company selling water purifiers.
The chief operating officer of petitioner 7K Corporation terminated Albarico’s employment allegedly
for his poor sales performance. Respondent had to stop reporting for work, and he subsequently
submitted his money claims against the petitioner for arbitration before the National Conciliation and
Mediation Board (NCMB).
4F 2021-2022 20
While the NCMB arbitration case was pending, respondent Albarico filed a Complaint against petitioner
corporation with the Arbitration Branch of the National Labor Relations Commission (NLRC) for illegal
dismissal with money claims.
ISSUE: WON labor arbiter of NLRC has original and exclusive jurisdiction over termination disputes.
HELD: No. Although the general rule under the Labor Code gives the labor arbiter exclusive and original
jurisdiction over termination disputes, it also recognizes exceptions. One of the exceptions is provided
in Article 262 of the Labor Code.
SAN MIGUEL V. SEMILLANO July 5, 2010 (In Relation To Cooperatives)

FACTS: Respondents were hired by AMPCO, a multi-purpose cooperative, and assigned them as bottle
fillers in San Miguel’s plant.
Allegedly, they were removed by San Miguel from work when eventually, they are no longer allowed
to enter the premises of San Miguel.
They filed a complaint for illegal dismissal against San Miguel.
San Miguel contended, among others, that the labor courts do not have jurisdiction over the case
because jurisdiction properly belongs to Arbitration Committee of Cooperative Development Authority.
ISSUE:
HELD: In ruling the merits of the case, SC held that San Miguel is the primary employer of respondents,
and that AMPCO is a labor-only contractor.
As to jurisdiction, the SC held that the Labor Court has jurisdiction because the subject matter is for
illegal dismissal. Respondents firmly believed that they are taking action, despite their membership
with AMPCO, against San Miguel as their employer, which was confirmed by SC in this case.
ELLAO V. BATELEC July 9, 2010 (In Relation To Cooperatives)

FACTS: Ellao was appointed as BATELEC’s General Manager, but his employment was terminated after
being charged with committing irregularities in the performance of his duties.
Aggrieved, Ellao filed a complaint for illegal dismissal and money claims against BATELEC before the LA,
alleging that the charges were unsubstantiated and there was no compliance with procedural due
process. The LA ruled in his favor.
On appeal, BATELEC argued that the RTC has jurisdiction over the subject matter pursuant to PD 902-A
as amended, which states that jurisdiction over intra-corporate disputes are with the RTC, not the NLRC.
ISSUE:
HELD: As a rule, the illegal dismissal of an officer or employee of a private employer is cognizable by
the LA. However, by way of exception, complaints for illegal dismissal filed by a corporate officer
constitute an intra-corporate controversy, which falls under the jurisdiction of the RTC pursuant to PD
902-A as amended by RA 8799.
Ellao is considered a corporate/cooperative officer because he was appointed by virtue of a resolution
by the Board of Directors, and the position of General Manager was expressly stated in the by-laws of
BATELEC.
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COMSCENTRE V. RICIO January 22, 2020 (Refund Of Employment Bond)
FACTS: Petitioners Comscentre Phils and its Country Manager Patrick Boe hired respondent Rocio as a
Network Engineer. Respondent informed petitioners of her intention to resign. Comscentre's Human
Resource Manager and Support Manager informed respondent she had to pay an "employment bond
of 80k for resigning within 24 months from the time she got employed as provided in their contract.
Hachero issued a show cause letter to respondent seeking her explanation why she should not be
subjected to disciplinary action for raising her concerns directly to Manager Glass and allegedly going
around her colleagues workstations during working hours to discuss her resignation.
Respondent sued petitioners for unfair labor practice, illegal suspension, illegal deduction,
underpayment of salaries, non-payment of wages, service incentive leave pay, and 13th month pay,
damages, and fees.
ISSUE:
HELD: The jurisdiction of labor tribunals is comprehensive enough to include claims for all forms of
damages "arising from the employer-employee relations. Labor tribunals have jurisdiction to award not
only the reliefs provided by labor laws, but also damages governed by the Civil Code.
Article 224 of the Labor Code clothes the labor tribunals with original and exclusive jurisdiction over
dams for damages arising from employer-employee relationship.
Here, the controversy was rooted in respondent's resignation from the company within 24 months from
the time she got employed in violation of the "Minimum Employment Length clause of her employment
contract. It is clear that petitioners claim for payment is inseparably intertwined with the parties
employer-employee relationship For it was respondent's act which gave rise to the petitioners, cause
of action for the payment of employment bond.
GEMUDIANO V. NAESS SHIPPING January 20, 2020

FACTS: Gemudiano was a seaman contracted by petitioner to be part of the crew of Royal Cargo. In
their contract, the employment will begin the moment Royal Cargo issues a boarding pass.
Because Royal Cargo cancelled its embarking, the contract, although signed, did not pursue further.
Gemudiano filed a complaint before the LA.
Respondent contested jurisdiction on the basis that it should be the Regular courts which must have
jurisdiction because it is a case of Breach of contract.
ISSUE:
HELD: The Court did not agree. The determination of propriety of petitioner’s non-deployment
necessarily involves the interpretation and application of labor laws, which are within the expertise of
labor tribunals.
It was reiterated that seamen would be at placed at an unfair position if their contracts will be treated
as mere contracts, and their non-deployment as a plain breach of contract. their only recourse would
be filing a case for damages which would require to present preponderance of evidence, as opposed to
other workers who will only have to prove substantial evidence before the labor courts.
PASAY CITY ALLIANCE CHURCH V. BENITO November 28, 2019
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FACTS: Benito was appointed Head of Pastoral Care and Membership. Benito served without a written
contract. The present controversy stemmed from CAMACOP and PCAC's policy requiring pastors or
ministers without written contracts to tender a courtesy resignation every year.
The CMT reappointed Benito to the same position for another year (2011). However, for the
subsequent year (2012), it then decided not to reappoint Benito but the decision was not immediately
pursued and so he held the post for another year. Such decision was later on upheld the following year.
Benito filed a complaint for illegal dismissal before the Labor Arbiter claiming that she had already
attained regular status by operation of law and entitled to security of tenure in view of her long years
of service with PCAC.
LA: There is an ER-EE relationship; NLRC: overturned LA; CA: annulled NLRC resolutions.
ISSUE: WON the “termination” of Benito is not an “ecclesiastical affair” but instead a severance of an
ER-EE relationship over which the LA has jurisdiction. – No
HELD: The Court held that the Church and the State to be separate and distinct from each other. At the
center of the present controversy is the enforcement of a religious denomination's internal rules in the
governance of its member churches.
The Court held that the termination of a religious minister's engagement at a local church due to
administrative lapses, when it relates to the perceived effectivity of a minister as a charismatic leader
of a congregation, is a prerogative best left to the church affected by such choice. Hence, LA has no
jurisdiction.
TUMAODOS V. SAN MIGUEL February 15, 2020 (SMC paid employee’s

separation benefits but withheld 1.4M due to
employee’s alleged indebtedness)
FACTS: Petitioner TRIFON TUMAODOS availed of the Involuntary Separation Program of respondent
SAN MIGUEL YAMAMURA PACKAGING CORPORATION. Petitioner’s separation package was computed
at P3,080,244.66, but respondent withheld the amount of P1,400,000.00 on behalf of the SMC
Employees Cooperative, to which petitioner allegedly had an outstanding indebtedness.
Respondent paid out petitioner's separation benefits, less the amount withheld. Petitioner, however,
asserted that he no longer had any obligation to the Cooperative and demanded the release of the
withheld amount. At the same time, the Cooperative also claimed entitlement to the same amount.
Due to petitioner's and the Cooperative's conflicting claims, respondent SMC filed a complaint for
interpleader before the RTC.
Petitioner then filed a complaint for non-payment of separation pay and damages before the NLRC.
ISSUE: Whether the Labor Arbiter had jurisdiction over the case of an employer's validity or authority
to deduct or the lack thereof? NO. It is the regular courts that have jurisdiction over petitioner's claims.
HELD: The jurisdiction of the LA over money claims and damages is confined to those cases which are
either accompanied by a claim for reinstatement or arising from employer-employee relations. Here,
although employment relations existed between respondent and petitioner, and the subject of the
complaint before the LA was petitioner's money claims against respondent, such money claims did not
involve and did not arise out of such employment relationship.
The controversy involves debtor-creditor relations between petitioner and the Cooperative, rather than
employer-employee relations between respondent and petitioner. Evidently, the employer-employee
4F 2021-2022 23
relationship between respondent and petitioner in this case is merely incidental and the principal relief
sought by petitioner can 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.
PRESCRIPTION OF ACTION
ZONIO V. 88 ACES MARITIME SERVICES October 16, 2019 (For Prescription Of Action)
FACTS: Zonio had a 6-month contract as ordinary seaman with the respondent. He embarked MV
Algosaibi on February 2010.
After the expiration of his contract, he was not repatriated as he allegedly signed another contract –
this time, directly with 88 Aces’ principal, Khalifa Algosaibi.
Zonio was finally repatriated in Manila in April 2012.
On April 2015, he filed a complaint before the LA against respondent and Khalifa Algosaibi for their
refusal to pay his disability benefits. Accordingly, Zonio was diagnosed with diabetes mellitus while he
was on board the vessel, and finally in 2015, was declared not fit to work.
Respondent sought the dismissal of the case on the ground that the Zonio’s 6-month contract has long
expired (2010); that no illness was raised during this period; that he was no longer an employee of 88
Aces when he was diagnosed with such illness while on board the vessel.
ISSUE:
HELD: Action has not prescribed. An employer-seafarer contract ceases upon its completion, when the
seafarer signs off from the vessel and arrives at the point of hire. Apolinario's six-month contract may
have ended as early as August 2010, he nonetheless was able to sign off from MV Algosaibi and arrive
at the point of hire only on April 11, 2012.
He had 3 years from the date (until April 2015), to make a claim for disability benefits. Records show
that Apolinario had requested for a SENA before the NLRC as early as March 25, 2015 – SENA being a
pre-requisite to the filing of a Complaint before the LA, the date when Apolinario should be deemed to
have instituted his claim was when he instituted his Request for SENA on March 25, 2015, which is well
within the prescription period.
ART. 225 [218]. POWERS OF THE NLRC

PAL V. NLRC March 20, 1998 (Injuction)
FACTS: 2 flight attendants dismissed from service due to alleged currency smuggling in Hong Kong.
They went directly to NLRC for petition for injunction against the order of dismissal issued by PAL and
demanding for reinstatement.
ISSUE: Can NLRC issue the injunction? – NO.
HELD: NLRC indeed has the jurisdiction to entertain injunction cases, however, injunction is merely a
provisional remedy. It is adjunct to a main suit, which was not filed in this case. The proper remedy of
the private respondents was to file an illegal dismissal case first before NLRC.
4F 2021-2022 24
LANDBANK OF THE PHILS. V. LISTANA August 5, 2008 (Indirect Contempt; Power of
Quasi-Judicial Bodies)
FACTS: Listana owns a land in Sorsogon. He voluntarily sold the land to the government under the CARL
law.
When just compensation was determined by DAR Adjudication Board, then PARAD (Provincial Agrarian)
issued a writ of execution ordering Landbank to pay Listana.
Writ was not acted upon.
PARAD cited Landbank for indirect contempt upon motion by Listana and ordered the arrest of
Landbank manager.
ISSUE: Can PARAD, an administrative office, charge Landbank in indirect contempt?
HELD: NO. There are only 2 ways to charge a person with indirect contempt – through verified petition
and motu proprio by the court. In this case, neither of the 2 took place.
Quasi-judicial bodies like PARAD are only empowered to cite persons in contempt by initiating them in
the proper RTC. They do not have the jurisdiction to decide indirect contempt cases.
ROBOSA V. NLRC February 8, 2012 (LA & NLRC has Jurisdiction to

Decide Contempt Cases)
FACTS: CTMI terminated several employees after an alleged union busting act committed by CTMI.
The Union of the employees then filed a complaint for illegal dismissal and unfair labor practice on
behalf of its affected members. The Union also sought issuance of injunction.
The TRO was issued directing CTMI to reinstate the employees, but CTMI ignored.
After such refusal on the part of CTMI, the Union then urgently moved for CTMI officers to be held in
contempt.
ISSUE: Does NLRC (a quasi-judicial body) have contempt powers?
HELD: YES. The rule provided under Rule 71 of the Rules of Court is not applicable when there is a
specific law granting an office or department contempt powers. Just like in the case of NLRC and Labor
Arbiter, Article 225 (d) specifically and expressly granted them contempt powers within their
jurisdiction. They don't need to simply initiate the complaint before RTC.
JOLO’S KIDDIE V. CABILLA November 29, 2017 (Appeal From NLRC; Venue
Rules)
FACTS: Respondents were employees of petitioners who were assigned to man their stalls in SM Bacoor
and SM Rosario.
Respondents were prompted to inquire with DOLE about the minimum wage, but when petitioner
discovered this, they were not allowed to report back to work.
An illegal dismissal case with claim for monetary benefits was filed against the petitioner.
LA decided in favour of respondents.
NLRC affirmed but increased the monetary awards.
4F 2021-2022 25
There were procedural issues raised by the petitioners.
ISSUE: Did the CA correctly dismissed the petition for certiorari filed by petitioner on the basis that the
petitioner failed to file a motion for reconsideration first?
Was there an error in venue?
HELD: Petition for certiorari: As a rule, MR is pre-condition to filing a certiorari except only if there is
patent nullity in the decision rendered by the lower court. In this case, the certiorari was correctly filed
because there was grave abuse of discretion on the part of NLRC when it raised the monetary awards
without basis. The CA then erred in dismissing the complaint.
In labor cases, grave abuse may be ascribed to the NLRC.
Venue: The petitioner contested the jurisdiction because the case was filed before RAB in Manila when
it should have been filed in Cavite. This is erroneous. The rule in NLRC Rules of Procedure only refers to
venue, not jurisdiction, and it even expressly provides that when venue is not objected before the first
mandatory conference, then such issue shall be deemed waived.
FRONDOZO V. MERALCO August 22, 2017

FACTS: The case originated from a Notice of Strike filed by the MERALCO Employees and Workers
Association (MEWA). Conciliation conferences failed to settle the dispute and resulted to a strike. Then
Acting Secretary of DOLE certified the labor dispute to the NLRC for compulsory arbitration.
MERALCO terminated the services of 25 union officers and workers including Frondozo. MEWA filed a
second Notice of Strike. Then DOLE Secretary Torres issued an Order that certified the issues raised in
the second strike to the NLRC for consolidation with the first strike, resulting to the filing of two
complaints for illegal dismissal.
The NLRC issued an Entry of Judgment stating that the NLRC Order became final and executory. A Writ
of Execution was issued; and MERALCO complied with the payroll reinstatement of petitioners.
However, with the promulgation of the 30 May 2003 Decision of the CA's Special Second Division,
finding that the strike was illegal and dismissing petitioners from the service, MERALCO stopped the
payroll reinstatement.
This prompted petitioners to move for the issuance of an Alias Writ of Execution which the LA granted.
Both the NLRC and the CA were confronted with two contradictory Decisions of two different Divisions
of the CA. The petitions questioning these two Decisions were both denied by this Court and the denial
attained finality.
The CA sustained the NLRC that the 30 May 2003 Decision of the CA’s Special Second Division is a
subsequent development that justified the suspension of the Alias Writs of Execution.
ISSUE: W/N the CA committed a reversible error in upholding the NLRC in issuing the writ of preliminary
injunction prayed for by MERALCO
HELD: NO. The situation in this case is analogous to a change in the situation of the parties making
execution unjust or inequitable. MERALCO's refusal to reinstate petitioners and to pay their backwages
is justified by the 30 May 2003 Decision of the CA. Clearly, the NLRC did not act in a capricious,
whimsical, arbitrary, or despotic manner. It suspended the proceedings because it cannot revise or
modify the conflicting Decisions of the CA.
4F 2021-2022 26
BISIG MANGAGAWA SA CONCRETE AGGREGATES September 16, 1993
V. NLRC
FACTS: Labor conflict started which resulted to the laborers conducting a wildcat strike.
Petitioners alleged that the company misrepresented its address causing the NLRC to hear the evidence
of the company alone.
Some thirty (30) minutes later, an Ocular Inspection Report was submitted by an unnamed NLRC
representative. No copy of this Order was furnished to the union. The union learned of the Order only
when it was posted on April 15, 1992 at the premises of the company. On April 21, 1992, it filed its
Opposition/Answer to the petition for Injunction.
ISSUE:
HELD: In the case at bar, the records will show that the NLRC violated the union’s right to strike and it
failed to comply with the letter and spirit of Article 218 (e), (4) and (5) of the Labor Code in issuing its
Order of May 5, 1992. Article 218 (e) of the Labor Code provides both the procedural and substantive
requirements which must strictly be complied with before a temporary or permanent injunction can
issue in a labor dispute.
In the case of petitioner, its petition for injunction was filed, and the records do not reveal whether the
public respondent has granted or denied the same. The disparate treatment is inexplicable considering
that the subject matters of their petition are of similar importance to the parties and to the public.
ART. 227 [221]. TECHNICAL RULES NOT BINDING AND PRIOR RESORT TO AMICABLE SETTLEMENT
MERALCO V. GALA March 7, 2012
FACTS: Galang, a lineman, was dismissed for his involvement in theft of Meralco supplies.
In his illegal dismissal case, he faulted Meralco on procedural grounds:
• Failure to include Community Tax Certificates of affiants;
• Failure to include updated MCLE certificate numbers of the legal counsel.
ISSUE:
HELD: The Court held that the intention of the labor legislation is that labor courts shall speedily
ascertain facts of cases without regard to technicalities of the law, as long as due process is served.
NATIONWIDE SECURITY AND ALLIED SERVICES V. July 14, 2008

CA
FACTS: Nationwide Security was ordered by LA to pay monetary claims to its dismissed security guards,
although there was no finding of illegal dismissal.
Unsatisfied, they filed an appeal with NLRC. The appeal was dismissed for being filed 3 days after the
reglementary period.
Nationwide Security sought relaxation of the procedural rules and for court to rule on the appeal based
on the merits of the case.
ISSUE:
4F 2021-2022 27
HELD: An appeal is a statutory right. The rules as to appeal must be strictly followed, including the filing
within the reglementary period within which to perfect an appeal. Failure to perfect an appeal renders
the judgment final and executory.
DIAMOND TAXI V. LLAMAS March 12, 2014

FACTS: Llamas is a taxi driver of Diamond Taxi who was dismissed from service.
When he filed an illegal dismissal complaint, the same was dismissed.
He filed a motion for reconsideration, which was prohibited under the Rules of Procedure, thus NLRC
treated his MR as an appeal.
However, his appeal was dismissed for failure to attach a certificate of non-forum shopping.
ISSUE:
HELD: The factual antecedents of the case would say that he subsequently attached the non-forum
shopping certificate in his MR, which was treated as an appeal, although late. The SC held that
ordinarily, the lack of non-forum shopping would be fatal but in this case, the court opted to relax the
application of the procedural rules pursuant to Article 227 of the Labor Code.
SARA LEE V. MACATLANG January 14, 2015

FACTS: Employees of now defunct Aris Corporation filed an illegal dismissal case against petitioners
alleging that their new company is just mere continuation of Aris Corp.
The LA rendered decision in favor of the employees, hence petitioners filed an appeal. However, they
deposited only a 10% of the bond requirement, invoking the McBurnie case.
The employees filed a petition for review before CA concerning the bond. However, despite the pending
PetRev, NLRC rendered its decision setting aside the decision of LA on procedural grounds.
ISSUE:
HELD: The 10% bond in McBurnie case was only the minimum amount of bond which the labor courts
may accept to suspend the running of the period for appeal, it is not the minimum amount of bond to
be posted.
The Court also noted that the posting of bond is mandatory to perfect an appeal. The NLRC erred in
deciding the case without first waiting for decision of CA concerning the bond.
The Court ordered NLRC to re-hear the case once proper bond is posted.
DELA ROSA LINER V. BORELA July 29, 2015

FACTS: Borela and Amarille filed complaints against petitioners for underpayment/non-payment of
salaries and other benefits, illegal deductions, and violation of Wage Order Nos. 13 to 16.
The petitioners moved to dismiss the case for forum shopping, alleging that the CA previously disposed
of a similar case between the parties after they entered into a compromise agreement which covered
all claims and causes of action they had against each other in relation to respondents’ employment.
4F 2021-2022 28
ISSUE: WON the compromise agreement on the 1st CA Decision bars the current complaint for payment
of monetary claims.
HELD: NO. The compromise agreement had been concluded to terminate the illegal dismissal and unfair
labor case then pending before the CA. While the parties agreed that no further action shall be brought
by the parties against each other, they pointedly stated that they referred to actions on the same
grounds. The phrase same grounds can only refer to the grounds raised in the first complaint and not
to any other grounds.
We likewise cannot accept the compromise agreement’s application “to all claims and damages or
losses either party may have against each other whether those damages or losses are known or
unknown, foreseen or unforeseen.” This coverage is too sweeping and effectively excludes any claims
by the respondents against the petitioners, including those that by law and jurisprudence cannot be
waived without appropriate consideration such as nonpayment or underpayment of overtime pay and
wages.
MAGSAYSAY MARITIME V. DE JESUS August 30, 2017

FACTS: Bernadine was hired by Magsaysay for a cruise ship and was diagnosed with Aortic Aneurysm
and died two months after the termination of his contract of employment.
De Jesus, Bernadine’s widow, filed a complaint against Magsaysay for payment of death benefits.
LA granted De Jesus, NLRC and CA affirmed.
Magsaysay argues that the award was issued with grave abuse of discretion since the death was not
compensable under POEA-SEC.
ISSUE:
HELD: Section 32-A of the POEA-SEC acknowledges the possibility of "compensation for the death of
the seafarer occurring after the employment contract on account of a work-related illness" as long as
the following conditions are met
1. The seafarer's work must involve the risks described herein;
2. The disease was contracted as a result of the seafarer's exposure to the described risks;
3. The disease was contracted within a period of exposure and under such other factors necessary
to contract it;
4. There was no notorious negligence on the part of the seafarer.
The court found that the conditions such as climate the worker was exposed to helped trigger the illness
and as such, there is a reasonable connection between the conditions of employment and work actually
performed. Award was proper.
ART. 229 [223]. APPEAL

GBMLT MANPOWER V. MALINAO July 6, 2015
FACTS: Respondent applied to petitioner for a job as teacher for deployment abroad. She was called
for an interview by the president of Ethiopian University and they offered her the post of accounting
lecturer which she accepted.
4F 2021-2022 29
Upon her arrival, she was told that her credentials would have to be re-evaluated, because it appeared
that she did not have a master's degree. On 10 January 2006, she decided to discontinue teaching the
course in cooperative accounting that had been assigned to her.
Respondent spent the rest of the semester without a teaching load. After sometime a notice of
termination was issued to respondent and eventually she was repatriated.
Respondent filed a complaint before the LA for the full payment of the unexpired portion of the two-
year contract. LA found respondent to have been unduly repatriated in breach of the employment
contract. Petitioner filed an appeal before the NLRC. CA ruled that since petitioner's check payment
was encashed only after the reglementary period within which to appeal, the appeal was considered to
have been filed out of time.
ISSUE:
HELD: The appeal of petitioner has been perfected on time by virtue of its compliance with the appeal
bond requirement. We note that its payment of the appeal bond through the issuance of a check was
not even an issue before the NLRC. The Supreme Court had occasion to rule that the appeal bond
requirement for judgments involving monetary awards may be relaxed in meritorious cases, as in
instances when a liberal interpretation would serve the desired objective of resolving controversies on
the merits.
OROZCO V. CA April 29, 2005

FACTS: This is the illegal dismissal case filed by Orozco, a lifestyle columnist, against Philippine Daily
Inquirer.
After the LA decided in favor of Orozco, PDI filed an appeal before NLRC but did not lodge a cash or
surety bond equivalent to the monetary award. Nonetheless, NLRC affirmed LA.
The decision was reversed in CA – Orozco is not an employee.
Orozco filed Rule 65 contending that CA failed to appreciate that NLRC affirmed that PDI did not even
post a bond during appeal.
ISSUE:
HELD: Court ruled that appeal bond is a condition sine qua non to perfection of an appeal. The Court
ordered that appeal bond be posted first before the case is given due course.
LEPANTO CONSOLIDATED MINING V. ICAO January 15, 2014

FACTS: This was an illegal dismissal case filed by Icao against Lepanto. LA ruled in favor of Icao.
In filing of appeal, the petitioner asked that the cash bond posted in another case which has reached
finality be released and used as appeal bond for this Icao case. The NLRC refused and dismissed the
appeal for failure to file a bond.
ISSUE:
HELD: Court said there is substantial compliance in this case. The intent of posting bond is for the
employee to surely receive compensation when judgement obtained is favorable to him. The bond in
the previous case which became final can be used:
• 7 months na nasa NLRC di pa narelease LOL
4F 2021-2022 30
• More than 400k yung bond tapos 300k lang required for Icao case.
FOREVER SECURITY V. FLORES September 7, 2007

FACTS: Romeo D. Flores and Lope A. Rallama were employed as security officers of Forever Security
and General Services. On February 15, 1993, Forever Security dismissed Flores and Rallama on the
ground that they abandoned their posts, duties and responsibilities as security guards. Hence, they filed
Complaints for Illegal Dismissal with the NLRC.
The case was calendared for hearings on various dates, but Forever Security and Vice President Garin
failed to appear. Labor Arbiter Dinopol thereafter rendered a decision in favor of complainants-
employees.
Petitioner filed its appeal and paid the appeal fee. Instead of posting a cash or surety bond, it filed a
motion for extension of time to file appeal or surety bond. Petitioner asked that it be given time within
which to post the bond. Apparently, petitioner did not make good its promise on the specified date. At
the time of the issuance of the NLRC Resolution dismissing the appeal, no bond was posted. Records
reveal that it was only in 1999 when the petitioner posted the bond.
ISSUE: WON the LA’s decision has become final and executory. – Yes
HELD: The petition is without merit on both the procedural and substantive issues.
At the outset, this Court would like to point out that the present case at bench had long become final
and executory for failure of petitioner to comply with procedural rules on perfection of appeals to the
NLRC.
Article 223 (now Art. 229) of the Labor Code sets forth the rules on appeal from the Labor Arbiter’s
monetary award which appeal by the employer may be perfected only upon the posting of a cash or
surety bond issued by a reputable bonding company duly accredited by the Commission in the amount
equivalent to the monetary award in the judgment appealed from.
The bond is mandatory and jurisdictional, and non-compliance is fatal and has the effect of rendering
the award final and executory. The logical purpose of an appeal bond is to insure, during the period of
appeal, against any occurrence that would defeat or diminish recovery under the judgment if
subsequently affirmed; it also validates and justifies, at least prima facie, an interpretation that would
limit the amount of the bond to the aggregate of the sums awarded other than in the concept of moral
and exemplary damages.
UERM- MEMORIAL MEDICAL CENTER V. NLRC March 3, 1997

FACTS: This was a wage distortion case where UERM during its appeal from the decision of LA, posted
property bond instead of cash or surety bond.
The employees moved to dismiss the appeal on the ground that the Article 229 expressly required
posting of either cash bond or surety bond.
ISSUE:
HELD: Court took in consideration that the petitioner is a medical center, which would be gravely
affected if it wouldn’t be able to post the 17M peso-bond. The Court said that the amount is sufficient
to protect the interest of the respondents.
4F 2021-2022 31
MANILA MINING V. AMOR April 20, 2015
FACTS: Here, the constructive dismissal case was ruled by LA in favor of the employees.
In an appeal, Manila Mining posted only 100k bond instead of 2.1M. The bond was also posted through
issuance of a check, 24 days after the decision of the LA has become final.
ISSUE:
HELD: Appeal is a statutory right and requisites thereof must be strictly complied with. The posting of
100k was supposed to effectively suspend the 10-day period which would attain the finality of LA’s
decision, however, the 100k was posted as check and 24 days late.
BANAHAW BROADCASTING V. PACANA May 30, 2011 (Appeal)

FACTS: Pacana et. al (DXWG personnel), are employees of the DXWG-Iligan City radio station which is
owned by Banahaw Broadcasting Corporation (BBC), a corporation managed by IBC.
The DXWG personnel filed a complaint for illegal dismissal, unfair labor practice, reimbursement of
unpaid CBA benefits, and attorney’s fees against IBC and BBC.
LA awarded the DXWG personnel unpaid CBA benefits. Both sets of parties appealed to the NLRC.
NLRC issued an Order denying the Motion for the Recomputation of the Monetary Award. NLRC
ordered BBC to post the required bond within 10 days from receipt of said Order, with a warning that
noncompliance will cause the dismissal of the appeal for non-perfection. Instead of complying with the
Order to post the required bond, BBC filed a Motion for Reconsideration, alleging that it is wholly owned
by the Republic and it need not post an appeal bond.
ISSUE: WON there is a need for an appeal bond.
HELD: Yes. BBC’s function is purely commercial or proprietary and not governmental. As such, BBC
cannot be deemed entitled to an exemption from the posting of an appeal bond. In case of a judgment
involving a monetary award, an appeal by the employer may be perfected only upon the posting of a
cash or surety bond issued by a reputable bonding company duly accredited by the Commission in the
amount equivalent to the monetary award in the judgment appealed from. The posting of the appeal
bond within the period provided by law is not merely mandatory but jurisdictional. The failure on the
part of BBC to perfect the appeal thus had the effect of rendering the judgment final and executory.
MC BURNIE V. GANZON October 17, 2013

FACTS: McBurnie worked for respondents until sometime in November 1999, when he figured in an
accident that compelled him to go back to Australia. While in Australia, he was informed that his
services were no longer needed.
Filed a complaint for illegal dismissal. LA declared there was illegal dismissal. Respondents filed a
motion to reduce bond but NLRC denied the motion on the basis of Art. 223 which requires the posting
of bond equivalent to monetary award. NLRC dismissed the appeal.
ISSUE: Whether NLRC’s dismissal of the appeal for failure to post additional bond was proper?
HELD: No. The filing of a motion to reduce bond, coupled with compliance with the two conditions; (1)
a meritorious ground, and (2) posting of a bond in a reasonable amount, shall suffice to suspend the
running of the period to perfect an appeal from the labor arbiter decision to the NLRC. To require the
full amount of the bond within the 10-day reglementary period would only render nugatory the legal
4F 2021-2022 32
provisions which allow an appellant to seek a reduction of the bond. A serious error of the NLRC was
its outright denial of the motion to reduce the bond without considering jurisprudence which allows
bond reduction.
SARA LEE PHILS. V. MACATLANG January 14, 2015

FACTS: Employees of now defunct Aris Corporation filed an illegal dismissal case against petitioners
alleging that their new company is just mere continuation of Aris Corp.
The LA rendered decision in favor of the employees, hence petitioners filed an appeal. However, they
deposited only a 10% of the bond requirement, invoking the McBurnie case.
The employees filed a petition for review before CA concerning the bond. However, despite the pending
PetRev, NLRC rendered its decision setting aside the decision of LA on procedural grounds.
ISSUE:
HELD: The 10% bond in McBurnie case was only the minimum amount of bond which the labor courts
may accept to suspend the running of the period for appeal, it is not the minimum amount of bond to
be posted.
The Court also noted that the posting of bond is mandatory to perfect an appeal. The NLRC erred in
deciding the case without first waiting for decision of CA concerning the bond.
The Court ordered NLRC to re-hear the case once proper bond is posted.
AFP GENERAL INSURANCE V. MOLINA June 30, 2008

FACTS: Molina filed an illegal dismissal complaint against their security agency. LA ruled that they were
illegally dismissed and ordered the agency to pay the sep. pay and backwages, etc. Agency appealed to
the NLRC and posted a supersedeas bond issued by petitioner as surety. NLRC affirmed the LA decision.
NLRC issued a notice of garnishment against the bond.
Petitioner filed with the LA a motion to quash the writ of garnishment and to discharge the appeal bond
on the ground that it has been cancelled because the security agency failed to pay the yearly premiums.
LA and NLRC denied the motion.
ISSUE:
HELD: The bond remains enforceable and under the jurisdiction of the NLRC until discharged. cash or
surety bond posted in appeals involving monetary awards in labor disputes "shall be in effect until final
disposition of the case." This could only be construed to mean that the surety bond shall remain valid
and in force until finality and execution of judgment, with the resultant discharge of the surety company
only thereafter, if we are to give teeth to the labor protection clause of the Constitution.
ISLRIZ TRADING V. CAPADE ET. AL. January 31, 2011 (Payment of Accrued Salaries
Pending Appeal Before The NLRC)
FACTS: Capada, et al were employees in sand and gravel business of petitioner. In an illegal dismissal
case, the LA ruled in favor of the employees, ordering reinstatement and payment of wages.
The petitioner appealed to NLRC saying that the employees actually abandoned work.
4F 2021-2022 33
The issue arose when the NLRC reversed the decision of the LA.
The petitioner claims that the decision of the LA was final and executory even pending appeal, but they
were not reinstated to their positions nor to the payroll.
ISSUE:
HELD: The reinstatement orders of Labor Arbiters are final and executory even pending appeal –
meaning, employees must be reinstated to their positions actually, or to the payroll.
Now, even after the finalization of the NLRC decision, the employees are still entitled to payment of the
wages due them during the period of LA’s decision for reinstatement until such time that NLRC has
rendered its decision.
FSFI V. NLRC December 11, 2003

FACTS: A complaint for illegal dismissal and monetary claims was filed by respondents against
petitioners before the National Labor Relations Commission. While the Respondents filed their position
papers, the Petitioners did not, thus, the Labor Arbiter construed this as waiver of their right to present
evidence.
The Labor Arbiter sustained the claims of the respondents and the petitioners were ordered to reinstate
respondents.
Petitioners appealed to the National Labor Relations Commission. For the first time, they submitted
evidence that respondents were project employees. Respondents, however, assailed the jurisdiction of
the NLRC over the appeal for failure of the petitioners to file the appeal bond within the ten (10)-day
reglementary period. They further contended that it was too late for petitioners to present evidence in
the NLRC.
ISSUE:
HELD: The appeal was dismissed. The Labor Code provides a ten (10)-day period from receipt of the
decision of the Arbiter for the filing of an appeal together with an appeal bond if the decision involves
a monetary award in favor of the employees. The NLRC Rules of Procedure likewise require the appeal
and the appeal bond to be filed within the ten (10)-day reglementary period. Payment of the appeal
bond is a jurisdictional requisite for the perfection of an appeal to the NLRC. It is only in rare instances
that the court relaxes the rule upon a showing of substantial compliance with it and to prevent patent
injustice.
BUENAOBRA V. LIM KING GUAN January 20, 2004

FACTS: Petitioners Lydia Buenaobra, et.al. were employees of private respondent Unix International
Export Corporation (UNIX), a corporation engaged in the business of manufacturing bags, wallets and
the like. Sometime in 1991 and 1992, petitioners filed several [labor] cases against UNIX and its
incorporators and officers for ULP, illegal lockout/dismissal, damages, etc. LA ruled in their favor (in
1993) which became final and executory for lack of appeal, but the petitioners complained that the
decision could not be executed because UNIX allegedly transferred all its assets to respondent Fuji
Zipper Manufacturing Corporation (FUJI) (sister corporation). Thus, in 1997, petitioners filed another
complaint against respondents UNIX and FUJI; LA ruled in favor of petitioners again.
July 1998 - FUJI, its officers and stockholders filed a memorandum on appeal and a motion to dispense
with the posting of a cash or surety appeal bond on the ground that they were not the employers of
petitioners. They alleged that they could not be held responsible for petitioners’ claims and to require
them to post the bond would be unjust and unfair, and not sanctioned by law;
4F 2021-2022 34
November 1998 NLRC order - motion to exempt from filing appeal bond was DENIED. Respondents
were directed to post bond.
Petitioners moved for reconsideration, arguing that the timely posting of an appeal bond is mandatory
for the perfection of an appeal and should be complied with;
1999 NLRC order - MR denied. CA denied petitioners’ petition for certiorari against NLRC. Hence this
case, under Rule 45.
ISSUE: Whether the CA erred in affirming the ruling of the NLRC which allowed private respondents to
post the mandated cash or surety bond four months after the filing of their memorandum on appeal.
HELD: No. The provision of Article 223 [now Art 229] of the Labor Code requiring the posting of bond
on appeals involving monetary awards must be given liberal interpretation in line with the desired
objective of resolving controversies on the merits. If only to achieve substantial justice, strict
observance of the reglementary periods may be relaxed if warranted. The NLRC, Third Division could
not be said to have abused its discretion in requiring the posting of bond after it denied private
respondents’ motion to be exempted therefrom... The facts and circumstances of the instant case
warrant liberality considering the amount involved and the fact that petitioners already obtained a
favorable judgment on February 23, 1993 against their employer UNIX.
BERGONIO V. SEAIR April 21, 2014 (Accrued Wages)

FACTS: petitioners filed before LA a complaint for illegal dismissal and illegal suspension with prayer for
reinstatement against respondents SEAIR and Irene Dornier as SEAIR’s president.
LA Ruling found petitioners illegally dismissed and ordered respondents to immediately reinstate the
petitioners with full backwages. respondents manifested their option to reinstate the petitioners in the
payroll. however, such reinstatement did not materialize.
ISSUE: WON the LA’s order for reinstatement of illegally dismissed employee immediately executory
even DURING the pendency of employer’s appeal from the decision?
HELD: YES. Under par. 3 of Art 229. reinstatement is immediately executory either by physically
admitting him under the conditions prevailing prior to his dismissal and paying his wages; or merely
reinstating him in the payroll. the failure to comply renders ER liable to pay salaries of employee. The
order of LA is self-executory – i.e., the dismissed EE need not apply for and the LA need not issue a writ
of execution to trigger the ER’s duty to reinstate.
LOON V. POWER MASTER December 11, 2013

FACTS: Respondents Power Master, Inc. and Tri-C General Services employed and assigned the
petitioners as janitors and leadsmen in various Philippine Long Distance Telephone Company (PLDT)
offices in Metro Manila area.
Subsequently, the petitioners filed a complaint for money claims against respondents. Respondents did
not participate in the proceedings before the Labor Arbiter except for two instances.
Labor Arbiter (LA) Elias H. Salinas partially ruled in favor of the petitioners. Both parties appealed the
LA’s ruling with the National Labor Relations Commission.
ISSUE: Petitioner pointed out that the respondents posted a bond from a surety that was not accredited
by the SC and by the NLRC.
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HELD: The respondents perfected their appeal with the NLRC because the revocation of the bonding
company's authority has a prospective application.
In the present case, the respondents filed a surety bond issued by Security Pacific Assurance
Corporation (Security Pacific) on June 28, 2002. At that time, Security Pacific was still an accredited
bonding company. However, the NLRC revoked its accreditation on February 16, 2003. Nonetheless,
this subsequent revocation should not prejudice the respondents who relied on its then subsisting
accreditation in good faith.
WATERFRONT CEBU CITY CASINO V. LEDESMA March 25, 2015. (Rule 65)
FACTS: Respondent Ledesma was dismissed on the ground of serious misconduct.
It was alleged by Christe Mandal (supplier of Waterfront) and Rosanna Lofranco (seeking a job at the
hotel) that they were sexually harassed by Ledesma.
Mandal: Ledesma kissed and mashed her breasts inside the elevator.
Lofranco: Ledesma asked her to masturbate him inside the conference room of the hotel
LA: ruled that there is illegal dismissal
NLRC: reversed LA, Ledesma filed a MR which was also denied.
Atty. Abellana (Ledesma’s counsel) received the dismissal of the MR on March 15, 2010.
He filed a R65 petition before the CA on May 17, 2010 or 63 days after his receipt.
Ledesma naman, he received his copy of the MR dismissal on March 24, 2010.
ISSUE: WON the Petition for Certiorari (R65) was belatedly filed, hence, the CA has no jurisdiction? YES.
HELD: Under Section 4, Rule 65 of the Rules of Court, the petition shall be filed not later than sixty (60)
days from notice of the judgment, order or resolution. In case a motion for reconsideration or new trial
is timely filed, whether such motion is required or not, the petition shall be filed not later than sixty
(60) days counted from the notice of the denial of the motion.
In this case, the Petition for Certiorari was belatedly filed as it was filed 63 days after the receipt of the
judgment. Ledesma even argues that the counting of the period shall start from his receipt. However,
the SC said that notice to the counsel is notice to the client.
The R65 petition should have been filed on or before May 15, 2010.
BALITE V. SSS VENTURES February 4, 2015

FACTS: Respondent SS Ventures International, Inc. is a domestic corporation duly engaged in the
business of manufacturing footwear products for local sales and export abroad.
Petitioners Balite, Bihasa and Anzaldo were regular employees of the respondent company until their
employments were severed for violation of various company policies.
Consequently, the three employees charged respondents with illegal dismissal and recovery of
backwages, 13th month pay and attorney’s fees before the Labor Arbiter.
The Labor Arbiter rendered a Decision in favor of petitioners and held that respondents are liable for
illegal dismissal.
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Aggrieved, respondents interposed an appeal by filing a Notice of Appeal and paying the corresponding
appeal fee. However, instead of filing the required appeal bond, they filed a Motion to Reduce the
Appeal Bond.
ISSUE: WON the appeal was perfected.
HELD: No. In case of a judgment involving a monetary award, an appeal by the employer may be
perfected only upon the posting of a cash or surety bond issued by a reputable bonding company duly
accredited by the Commission in the amount equivalent to the monetary award in the judgment
appealed from.
TURKS SHAWARAMA V. PAJARON January 16, 2017

FACTS: Respondents Pajaron and Carbonilla were hired by petitioners as service crews. They filed a
complaint against petitioners, claiming that they were illegally dismissed and claiming non-payment of
wages and other benefits. Petitioners denied having dismissed the respondents, claiming that they
actually abandoned their work.
The LA ruled in favor of respondents and awarded monetary awards representing their unpaid wages
and benefits. Petitioners appealed to the NLRC, but the appeal was denied for non-perfection due to
failure of petitioners to comply with the requisites in filing a motion to reduce bond.
ISSUE:
HELD: Under the labor code, “In case of a judgment involving a monetary award, an appeal by the
employer may be perfected only upon the posting of a cash or surety bond … in the amount equivalent
to the monetary award in the judgment appealed from.”
The CA correctly found that the NLRC did not commit grave abuse of discretion in denying petitioners’
motion to reduce bond because it was not predicated on meritorious and reasonable grounds (financial
difficulties), and the amount tendered (P15,000) is not reasonable in relation to the monetary award
(~P198,000).
REINSTATEMENT ASPECT OF LA’S DECISION

PIONEER TEXTURIZING CORPORATION V. NLRC 1997 Case
FACTS: Private respondent Lourdes A. de Jesus is petitioners’ reviser/trimmer since 1980. The
petitioners terminated her employment for dishonesty and tampering of official records and
documents with the intention of cheating. De Jesus maintained that she merely committed a mistake.
The LA ruled that petitioners are guilty of illegal dismissal and ordered reinstatement of de Jesus to her
previous position. The NLRC affirmed.
Petitioner argued that an order for reinstatement is not self-executory. They maintain that even if a
writ of execution was issued, a timely appeal coupled by the posting of appropriate supersedeas bond,
which they did in this case, effectively forestalled and stayed execution of the reinstatement order of
the Labor Arbiter.
ISSUE:
HELD: An award or order for reinstatement is self-executory, and does not require a writ of execution,
much less a motion for its issuance. Under the Art. 223, the decision of the Labor Arbiter reinstating a
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dismissed or separated employee insofar as the reinstatement aspect is concerned, shall be
immediately executory, even pending appeal.
ROQUERO V. PAL 2 April 2004

FACTS: Petitioner ALEJANDRO ROQUERO, a ground equipment mechanic of PAL, was dismissed from
employment when caught redhanded possessing shabu, in violation of the PAL Code of Discipline. He
alleged, however, that the act was instigated by PAL. Thereafter, Roquero filed a case for illegal
dismissal.
The Labor Arbiter ruled both petitioner and PAL blameworthy and thus, dismissed petitioner, but
awarded him separation pay and attorney's fees.
When appealed to the NLRC, petitioner was ordered reinstated to his former position, but PAL refused,
as it had filed a petition for review before the Court.
ISSUE: Can the executory nature of the reinstatement aspect of a labor tribunal's order be halted by a
petition having been filed in higher courts without any restraining order or preliminary injunction having
been ordered in the meantime?
HELD: NO. Unless there is a restraining order issued, it is ministerial upon the Labor Arbiter to
implement the order of reinstatement.
Petitioner was guilty of serious misconduct. Even if he was instigated to take drugs, he has no right to
be reinstated in his position. At any rate, when petitioner was ordered reinstated by the NLRC, the
same was immediately executory even pending appeal. The unjustified refusal of PAL to reinstate him
entitles him to payment of salaries effective from the time he should have been reinstated until finality
of the Court's decision reversing such order.
OTHER RULES ON REINSTATEMENT
1. Even if the order of reinstatement of the Labor Arbiter is reversed on appeal, it is obligatory on the
part of the employer to reinstate and pay the wages of the dismissed employee during the period
of appeal until reversal by the higher court.
2. If the employee has been reinstated during the appeal period and such reinstatement order is
reversed with finality, the employee is not required to reimburse whatever salary he received for
he is entitled to such, more so if he actually rendered services during the period.
AIR PHIL CORP. V. ZAMORA August 7, 2004

FACTS: Zamora was employed as flight deck crew by Air Phil. Corp. He filed for a promotion to “airplane
captain” and underwent the necessary training program. Despite such, his application for promotion
was not acted upon and he continued to receive assignments relating to his position of flight deck crew.
He filed a complaint for constructive dismissal before the LA. He contended that APC’s act of
withholding his promotion rendered his continued employment with it oppressive and unjust.
The LA ruled in favor of Zamora and ordered that, among others, he be reinstated to the position
CAPTAIN without loss of seniority rights. However, NLRC held that there was no illegal dismissal.
Nonetheless, it ordered APC to pay salaries and allowances to Zamora arising from the order of his
reinstatement, which is executory even pending appeal.
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ISSUE: WON NLRC correctly ordered APC to pay Zamora the salaries and allowances arising from LA’s
order of reinstatement.
HELD: Yes. The LA’s order of reinstatement was already the subject of an alias writ of execution even
pending appeal. Hence, even if the order of reinstatement of the Labor Arbiter is reversed on appeal,
it is obligatory on the part of the employer to reinstate and pay the wages of the dismissed employee
during the period of appeal until reversal by the higher court.
Now, if the employee has been reinstated during the appeal period and such reinstatement order is
reversed with finality, the employee is not required to reimburse whatever salary he received for he is
entitled to such, more so if he actually rendered services during the period.
LANSANGAN V. AMKOR TECHNOLOGY PHILIPPINES January 30, 2009

FACTS: An anonymous e-mail was sent to the General Manager of Amkor detailing allegations of
malfeasance on the part of petitioners for "stealing company time." Petitioners admitted their
wrongdoing. Respondent thereupon terminated petitioners, prompting petitioners to file a complaint
for illegal dismissal against it.
The LA dismissed petitioners' complaint having found them guilty of [s]wiping another employees' I.D.
card, an offense of dishonesty punishable as a serious form of misconduct under Article 282 of the
Labor Code. The Arbiter, however, ordered the reinstatement of petitioners to their former positions
without backwages.
Petitioners, without appealing the Arbiter's finding them guilty of dishonesty, moved for the issuance
of a "writ of reinstatement." The Arbiter issued an alias writ of execution.
The NLRC granted respondent's appeals by deleting the reinstatement aspect of the Arbiter's decision
and setting aside the Arbiter's Alias Writ of Execution.
The CA ordered respondent to pay petitioners their corresponding backwages. This has become final.
ISSUE: W/N petitioners are entitled to full backwages.
HELD: NO. The decision of the Arbiter finding had become final, petitioners not having appealed the
same before the NLRC. Article 223 concerns itself with an interim relief, granted to a dismissed or
separated employee while the case for illegal dismissal is pending appeal. It does not apply where there
is no finding of illegal dismissal, as in the present case. The Arbiter found petitioners' dismissal to be
valid. Following Article 279, petitioners are not entitled to full backwages as their dismissal was not
found to be illegal.
GENUINO V. NLRC December 4, 2007

FACTS: Genuino was employed by Citibank
Citibank sent Genuino a letter charging her with "knowledge and/or involvement" in transactions
"which were irregular or even fraudulent." In the same letter, Genuino was informed she was under
preventive suspension.
NLRC stated that Genuino was validly dismissed and it likewise ordered the payment of salaries from
the time that Genuino was reinstated in the payroll to the date of the NLRC decision
Citibank questions the ruling that Genuino has a right to reinstatement under Article 223 of the Labor
Code. Citibank contends that the Labor Arbiter's finding is not supported by evidence; thus, the decision
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is void. Since a void decision cannot give rise to any rights, Citibank opines that there can be no right to
payroll reinstatement.
ISSUE:
HELD: The dismissal was for just cause but lacked due process.
In view of Citibank's failure to observe due process, however, nominal damages are in order but the
amount is hereby raised to P30,000 pursuant to Agabon v. NLRC. The NLRC's order for payroll
reinstatement is set aside.
GARCIA ET AL. V. PAL January 20, 2009

FACTS: Petitioners were dismissed after they were allegedly caught in the act of sniffing shabu. As a
result, they filed an illegal dismissal case and damages against PAL.
Prior to the promulgation of LA’s decision, SEC placed PAL under rehabilitation.
LA ruled in favor of petitioners and ordered their reinstatement. NLRC then referred the action to the
Rehabilitation Receiver for appropriate action but the CA held that petitioners are not entitled to their
accrued wages during the pendency of PAL’s appeal.
ISSUE: 1) WON subsequent finding of a valid of a valid dismissal removes the basis for implementing
the reinstatement aspect of LA’s decision.
2) WON corporate rehabilitation is a legal justification for PAL’s non-compliance with the reinstatement
order.
HELD: 1st issue: NO. Even if the order of reinstatement of the Labor Arbiter is reversed on appeal, it is
obligatory on the part of the employer to reinstate and pay the wages of the dismissed employee during
the period of appeal until reversal by the higher court. It settles the view that the Labor Arbiter’s order
of reinstatement is immediately executory.
2nd issue: YES. PAL being placed under corporate rehabilitation, wherein claims against PAL are
suspended, partakes of the nature of a restraining order that constitutes a legal justification for
respondent’s non-compliance with the reinstatement order. The obligation to pay the employee’s
salaries upon the employer’s failure to exercise the alternative options (actual reinstatement or payroll
reinstatement) under Article 223 (now Art. 229) of the Labor Code is not a hard and fast rule,
considering the inherent constraints of corporate rehabilitation.
MT. CARMEL COLLEGE V. RESUENA October 10, 2007

FACTS: Respondents, with faculty members, non-academic personnel and other students, participated
in a protest action against petitioner which is a private educational institution.
Respondents were terminated and filed complaints of illegal dismissal and claimed payments.
LA - not illegally dismissed but ordered payment.
NLRC reversed LA and directed reinstatement. CA affirmed.
ISSUE: WON the continuing award of backwages is proper – YES
HELD: An illegally dismissed employee is entitled to two reliefs: backwages and reinstatement. The two
reliefs provided are separate and distinct. In instances where reinstatement is no longer feasible
because of strained relations between the employee and the employer, separation pay is granted. In
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effect, an illegally dismissed employee is entitled to either reinstatement, if viable, or separation pay if
reinstatement is no longer viable, and backwages.
BUENVIAJE V. CA November 12, 2002

FACTS: Petioners were former employees of Cottonway Marketing Corp. After their services were
terminated, they filed with the NLRC a complaint for illegal dismissal.
LA finds petitioner’s retrenchment valid, ordering Cotton way to pay petitioner’s separation pay and
13th month pay. NLRC ordered the petitioners’ reinstatement and ordered Cottonway to pay their full
backwages computed from the time their salaries were withheld up to the date of their reinstatement.
CA reversed the ruling of NLRC since reinstatement is no longer possible as they refused to return to
work and held that the amount of backwages should be computed only up to the time they received
their notice of termination.
ISSUE:
HELD: Petitioners' alleged failure to return to work cannot be made the basis for their termination. Such
failure does not amount to abandonment which would justify the severance of their employment. We
hold that petitioners are entitled to receive full backwages computed from the time their compensation
was actually withheld until their actual reinstatement, or if reinstatement is no longer possible, until
the finality of the decision, in accordance with the Decision of the NLRC dated March 26, 1996 which
has attained finality. Decision of the Court of Appeals were reversed and set aside.
PFIZER INC. V. VELASCO March 9, 2011

FACTS: Geraldine Velasco was employed with petitioner PFIZER, INC. as Professional Health Care
Representative. Sometime in April 2003, Velasco had a medical work up for her high-risk pregnancy and
was subsequently advised bed rest which resulted in her extending her leave of absence from March
to July 2003.
While Velasco was still on leave, PFIZER through its Area Sales Manager, herein petitioner Ferdinand
Cortez, personally served Velasco a "Show-cause Notice." Aside from mentioning about an investigation
on her possible violations of company work rules regarding "unauthorized deals and/or discounts in
money or samples, the notice also advised her that she was being placed under "preventive suspension"
for 30 days. Velasco denied the charges.
Velasco filed a complaint for illegal suspension with money claims before the Regional Arbitration
Branch. Then PFIZER informed Velasco of its "Management Decision" terminating her employment.
The Labor Arbiter and NLRC rendered decisions declaring the dismissal of Velasco illegal, ordering her
reinstatement with backwages. CA ruled in favor of the validity of the respondent’s dismissal.
ISSUE: 1. Is it obligatory for the employer to reinstate and pay the wages of the dismissed employee
during the period of appeal even if later on reversal by the higher court? – Yes
2. Is the award by the Labor Arbiter for reinstatement immediately executory even pending appeal? –
Yes
3. Was Pfizer correct in requiring the respondent employee to assign her to a new location in
compliance with the LA’s reinstatement order? – No
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HELD: 1. The Court held that even if the order of reinstatement of the Labor Arbiter is reversed on
appeal, it is obligatory on the part of the employer to reinstate and pay the wages of the dismissed
employee during the period of appeal until reversal by the higher court. On the other hand, if the
employee has been reinstated during the appeal period and such reinstatement order is reversed with
finality, the employee is not required to reimburse whatever salary he received, more so, if he actually
rendered services during the period.
2. The Court held that that the provision of Article 223 is clear that an award by the Labor Arbiter for
reinstatement shall be immediately executory even pending appeal and the posting of a bond by the
employer shall not stay the execution for reinstatement.
3. The Court held that such is not a bona fide reinstatement. Under Article 223 of the Labor Code, an
employee entitled to reinstatement shall either be admitted back to work under the same terms and
conditions prevailing prior to his dismissal or separation or, at the option of the employer, merely
reinstated in the payroll.
WENPHIL CORP. V. ABING April 7, 2014

FACTS: A complaint for illegal dismissal was filed by the respondents against Wenphil.
LA ruled that respondents had been illegally dismissed. Allegations of serious misconduct had no factual
and legal basis. LA ordered Wenphil to immediately reinstate the respondents and to pay backwages
until the date of their actual reinstatement.
Wenphil appealed to the NLRC. Wenphil and the respondents entered into a compromise agreement.
They agreed to the respondents’ payroll reinstatement while Wenphil’s appeal with the NLRC was
ongoing.
NLRC ruled in favor of respondents and directed Wenphil to pay respondents’ separation pay.
CA reversed the NLRC. SC affirmed the CA. The decision became final and executory.
After the SC’s decision became final, respondents filed with LA a motion for computation and issuance
of writ of execution. They asserted that although there was no illegal dismissal, they were still entitled
to backwages from the time of their dismissal until the NLRC’s decision finding them to be illegally
dismissed was reversed with finality.
ISSUE: WON respondents were still entitled to payment of backwages in view of the modification of
the LA’s ruling by the NLRC.
HELD: Yes. An order of reinstatement is immediately executory even pending appeal. The employer has
the obligation to reinstate and pay the wages of the dismissed employee during the period of appeal
until reversal by the higher court. Under Article 223 of the Labor Code, "the decision of the Labor Arbiter
reinstating a dismissed or separated employee, insofar as the reinstatement aspect is concerned, shall
immediately be executory, even pending appeal. The employee shall either be admitted back to work
under the same terms and conditions prevailing prior to his dismissal or separation, or at the option of
the employer, merely reinstated in the payroll. The posting of a bond by the employer shall not stay
the execution for reinstatement."
SMART COMMUNICATIONS V. SOLIDUM April 15, 2015
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FACTS: Solidum was hired by Smart as department head for smart buddy. He was given a memo
regarding his alleged acts of dishonesty and was placed under preventive suspension without pay.
Solidum was eventually terminated.
He filed a complaint for illegal dismissal, illegal suspension, non-payment of salaries. LA found there
was illegal dismissal ordering reinstatement. NLRC reversed decision.
LA ordered sheriff to collect from Smart, Solidum’s accrued salaries, allowances, benefits. Smart filed a
motion to order Solidum to return the total amount under the writ of execution.
ISSUE: Whether the employee is bound to return the amount received upon reversal of the decision
despite being entitled to reinstatement wages from the LA decision until such reversal.
HELD: No. In Bago v. NLRC, the Court held that employees are entitled to their accrued salaries,
allowances, benefits, incentives and bonuses until the NLRC’s reversal of the labor arbiter’s order of
reinstatement becomes final and executory, as shown on the entry of judgment.
MANILA DOCTORS COLLEGE V. OLOROES October 3, 2016

FACTS: Olores was a faculty member of Manila Doctors College. He was dismissed from service for grave
misconduct and gross inefficiency. He filed a case for illegal dismissal.
LA ruled that he was illegally dismissed and ordered petitioners to reinstate respondent as faculty
member. But instead of being reinstated, Olores was given the option to receive separation pay.
NLRC reversed the LA ruling and dismissed the case for lack of merit.
While the case is pending appeal, respondent filed a motion to enforce to LA ruling. Motion was granted
NLRC reversed the decision. CA reversed NLRC.
ISSUE:
HELD: LA decision reinstating a dismissed employee, is immediately executory, even pending appeal.
However, in the even that the LA’s decision is reversed by higher tribunal, the employer's duty to
reinstate the dismissed employee is effectively terminated. This means that an employer is no longer
obliged to keep the employee in the actual service or in the payroll. The employee, in tum, is not
required to return the wages that he had received prior to the reversal of the LA's decision.
Notwithstanding the reversal of the finding of illegal dismissal, an employer, who, despite the LA's order
of reinstatement, did not reinstate the employee during the pendency of the appeal up to the reversal
by a higher tribunal may still be held liable for the accrued wages of the employee, i.e., the unpaid
salary accruing up to the time of the reversal. By way of exception, an employee may be barred from
collecting the accrued wages if shown that the delay in enforcing the reinstatement pending appeal
was without fault on the part of the employer.
SY ET. AL. V. FAIRLAND KNITCRAFT CO. December 12, 2011

FACTS: Workers Sy et.al. filed with the NLRC a Complaint against Weesan and its owner Susan. The
workers filed Amended Complaint and another pleading to include the charge of illegal dismissal and
impleaded Fairland and its manager, Debbie, as additional respondents. Atty. Geronimo appeared as
counsel for Weesan and Fairland.
The Labor Arbiter ruled in favor of the Respondents but was reversed on appeal by the NLRC. Geronimo
filed a motion for reconsideration, but the same was denied.
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Fairland filed another MR through Atty. Tecson assailing the jurisdiction of the LA and the NLRC,
claiming that it was never summoned to appear, attend or participate in all the proceedings conducted
therein. It also denied that it engaged the services of Atty. Geronimo. Anent the resolution promulgated
by the NLRC, only Geronimo, Weesan, and Fairland were furnished with the same.
The CA held that the labor tribunal did not acquire jurisdiction over the person of Fairland. Furthermore,
the CA concluded that since Fairland and its counsel were not separately furnished with a copy of the
NLRC Resolution, applying Art. 224 (now Art. 230) said Decision cannot be enforced against Fairland.
The CA then concluded that since Fairland and its counsel were not separately furnished with a copy of
the NLRC Resolution denying the motions for reconsideration of its 2004 Decision, said Decision cannot
be enforced against Fairland.
ISSUE:
HELD: Article 224 contemplates the furnishing of copies of final decisions, orders or awards both to the
parties and their counsel in connection with the execution of such final decisions, orders or awards.
However, for the purpose of computing the period for filing an appeal from the NLRC to the CA, the
same shall be counted from receipt of the decision, order or award by the counsel of record pursuant
to the established rule that notice to counsel is notice to party. And since the period for filing of an
appeal is reckoned from the counsel’s receipt of the decision, order or award, it necessarily follows that
the reckoning period for their finality is likewise the counsel’s date of receipt thereof.
Hence, the date of receipt referred to in Sec. 14, Rule VII of the then in force New Rules of Procedure
of the NLRC which provides that decisions, resolutions or orders of the NLRC shall become executory
after 10 calendar days from receipt of the same, refers to the date of receipt by counsel. Thus contrary
to the CA’s conclusion, the said NLRC Decision became final, as to Fairland, 10 calendar days after Atty.
Tecson’s receipt thereof.
IBM NESTLE V. NESTLE PHILS September 23, 2015

FACTS: Petitioner union (IBM) staged a strike against Nestle’s Ice Cream and Chilled Products Division,
for respondent's alleged violation of the (CBA), and other ULP acts.
Respondent filed a Petition to Declare Strike Illegal. DOLE Acting Secretary, issued an Order assuming
jurisdiction over the strike and certifying the same to the NLRC.
However, after a series of conciliation meetings and discussions between the parties, they agreed to
resolve their differences and came up with a compromise which was embodied in a MOA.
NLRC approved the parties' compromise agreement and granted their Joint Motion to Dismiss.
After a lapse of more than (11) years from the time of execution of the subject MOA, petitioners filed
with the NLRC a Motion for Writ of Execution. Respondent filed its Opposition to the Motion for Writ
of Execution contending that petitioners' remedy is already barred by prescription.
NLRC denied petitioners' application on the ground of prescription. Petitioners MR was likewise denied.
CA also dismissed petitioners' certiorari petition on the ground that it is a wrong mode of appeal.
ISSUE: Whether petitioners' claim is already barred by prescription.
HELD: Yes. The most relevant rule in the instant case is Section 8, Rule XI, 2005 Revised Rules of
Procedure of the NLRC *Court also cited 4 (a) and 6, Rule III, of the NLRC Manual on Execution of
Judgment; Section 6, Rule 39 of the Rules of Court; and Article 1144 of the Civil Code. If the prevailing
party fails to have the decision enforced by a mere motion after the lapse of five years from the date
of its entry (or from the date it becomes final and executory), the said judgment is reduced to a mere
4F 2021-2022 44
right of action in favor of the person whom it favors and must be enforced, as are all ordinary actions,
by the institution of a complaint in a regular form.
In this case, it is clear that the judgment of the NLRC, having been based on a compromise embodied
in a written contract, was immediately executory upon its issuance on October 12, 1998. Thus, it could
have been executed by motion within five (5) years. It was not. Nonetheless, it could have been
enforced by an independent action within the next five (5) years, or within ten (10) years from the time
the NLRC Decision was promulgated. It was not. Therefore, petitioners' right to have the NLRC judgment
executed by mere motion as well as their right of action to enforce the same judgment had prescribed
by the time they filed their Motion for Writ of Execution on January 25, 2010.
It is true that there are instances in which this Court allowed execution by motion even after the lapse
of five years upon meritorious grounds. However, there is, invariably, only one recognized exception,
i.e., when the delay is caused or occasioned by actions of the judgment debtor and/or is incurred for
his benefit or advantage. In the present case, there is no indication that the delay in the execution of
the MOA, as claimed by petitioners, was caused by respondent nor was it incurred at its instance or for
its benefit or advantage.
YUPANGCO COTTON MILLS V. CA January 16, 2002

FACTS: this case stems from the fact that the sheriff unlawfully levied upon certain properties of the
petitioner. it filed several notice of claims with LA, NLRC, RTC, and CA. the dismissal of the CA triggered
the instant petition which raised a common issue which is the owner of the property located in the
compound and buildings of Artex Development Corp. were erroneously levied by the sheriff of NLRC.
ISSUE: May a 3rd party be precluded from availing himself of the other alternative remedies in the
event he failed in the remedy first availed of?
HELD: No. a 3rd party whose property has been levied upon by the sheriff to enforce a decision against
a judgment debtor is afforded several alternative remedies to protect its interests. the 3rd party may
avail the alternative remedies CUMULATIVELY, and one will not preclude the 3rd party from availing of
the other alternative remedies in the event he failed in the remedy first availed of.
He may avail himself of the ff remedies:
1. File 3rd party claim with the sheriff of LA; and
2. If the 3rd party claim is denied, the 3rd party may appeal denial to the NLRC.
ANDO V. CAMPO February 16, 2011

FACTS: Petitioner was the president of Premier Allied and Contracting Services, Inc. (PACSI), an
independent labor contractor. Respondents were hired by PACSI as pilers or haulers tasked to manually
carry bags of sugar from the warehouse.
Respondents were dismissed from employment. They filed a case for illegal dismissal and some money
claims with the National Labor Relations Commission.
They filed a case for illegal dismissal and some money claims. PACSI and petitioner were directed to
pay a total of P422,702.28, representing respondents' separation pay and the award of attorney's fees.
Acting Sheriff Romeo Pasustento issued a Notice of Sale on Execution of Personal Property over the
property covered by Transfer Certificate of Title (TCT) No. T-140167 in the name of "Paquito V. Ando x
x x married to Erlinda S. Ando."
4F 2021-2022 45
ISSUE: Petitioner claimed that the property belonged to him and his wife, not to the corporation, and,
hence, could not be subject of the execution sale.
HELD: The TCT of the property bears out that, indeed, it belongs to the petitioner and his wife.
Moreover, the power of the NLRC, or the courts, to execute its judgment extends only to properties
unquestionably belonging to the judgment debtor alone. A sheriff, therefore, has no authority to attach
the property of any person except that of the judgment debtor.
PAL V. BISCHARA September 2, 2015

FACTS: Bischara was demoted to the position of flight steward from flight purser on March 21, 1994.
Bichara then filed a complaint for illegal demotion against PAL.
This illegal demotion case was later on granted and the LA ordered the reinstatement of Bichara on
June 16, 1997 and was rendered final and executory on Feb. 5, 2004.
On June 22, 1998, a separate complaint for illegal retrenchment with claims for reinstatement and
payment of salaries was filed against PAL which remained pending up to the time of this case.
On Feb. 4, 2009, LA Macam granted Bichara’s motion for execution against PAL directing the latter to
render separation pay, in lieu of reinstatement to Bichara.
ISSUE: WON the award of separation pay in lieu of reinstatement in favor of Bichara is proper? No.
HELD: The awards of separation pay in lieu of reinstatement were all hinged on the validity of the
employee’s dismissal. Here, the validity of Bichara’s termination is the subject matter of a separate case
which is still pending before the Court, and is also beyond the ambit of the illegal demotion proceedings.
Hence, LA Macam exceeded his authority when he ruled on this issue and directed PAL to pay Bichara
separation pay in lieu of reinstatement.
The awards of backwages, and retirement benefits, including attorney's fees, moral, and exemplary
damages, if any, cannot, however, be executed in these proceedings since they are incidents which
pertain to the illegal retrenchment case, hence, executable only when the FASAP case is finally
concluded.
GUILLERMO V. USON March 7, 2016

FACTS: Respondent Uson is an employee of Royal Class Venture as an accounting clerk, until he was
allegedly dismissed from employment.
Consequently, Uson filed with the NLRC a Complaint for Illegal Dismissal.
Labor rendered a Decision in favor of the complainant Uson and ordering therein respondent Royal
Class Venture to reinstate him to his former position and pay money claims.
ISSUE: WON officer of a corporation may be included as judgment obligor in a labor case for the first
time only after the decision of the Labor Arbiter had become final and executory.
HELD: The veil of corporate fiction can be pierced, and responsible corporate directors and officers or
even a separate but related corporation, may be impleaded and held answerable solidarily in a labor
case, even after final judgment and on execution, so long as it is established that such persons have
deliberately used the corporate vehicle to unjustly evade the judgment obligation, or have resorted to
fraud, bad faith or malice in doing so.
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DUTCH MOVERS INC. V. LEQUIN ET AL April 25, 2017 (Piercing The Veil Of Corporate
Fiction)
FACTS: Dutch Movers, Inc. (DMI) informed the respondents that it would cease its hauling operation
but did not provide a reason. As such, respondents requested DMI to issue a formal notice regarding
the matter, to no avail. Thus, respondents filed a complaint for illegal dismissal. The NLRC ruled in their
favor.
Pending the resolution of the motions for writ of execution, respondents discovered that DMI no longer
operates, along with other suspiciously fraudulent actions by petitioners, which prompted them to pray
that petitioners and officers named in DMI’s AOI be impleaded and held solidarily liable with DMI in
paying the judgment awards.
ISSUE:
HELD: The veil of corporate fiction must be pierced and, accordingly, petitioners should be held
personally liable for judgment awards because the peculiarity of the situation shows that they
controlled DMI; they actively participated in its operation such that DMI existed not as a separate entity
but only as a business conduit of petitioners. Petitioners controlled DMI by making it appear to have no
mind of its own, and used DMI as a shield in evading legal liabilities.
GENUINO AGRO V. ROMANO September 18, 2019 (Piercing The Veil Of

Corporate Fiction)
FACTS: Genuino was employed by Citibank, an American banking corporation duly licensed to do
business in the Philippines, sometime in January 1992 as Treasury Sales Division Head with the rank of
Assistant Vice-President. Genuino's employment was terminated by Citibank on grounds of (1) serious
misconduct, (2) willful breach of the trust reposed upon her by the bank, and (3) commission of a crime
against the bank.
Genuino filed before the Labor Arbiter a Complaint for illegal suspension and illegal dismissal.
The Labor Arbiter decided in favor of Genuino and ordered for her reinstatement immediately to her
former position, with backwages, moral and exemplary damages plus 10% of the total monetary award
as attorney's fees. The NLRC reversed the Labor Arbiter's decision but ordered the respondent bank to
pay the salaries due to the complainant from the date it reinstated the complainant in the payroll up
to and until the date of this decision.
ISSUE:
HELD: The employer is required to reinstate the employee during the pendency of the appeal pursuant
to Art. 223, paragraph 3 of the Labor Code, which states: In any event, the decision of the Labor Arbiter
reinstating a dismissed or separated employee, insofar as the reinstatement aspect is concerned, shall
immediately be executory, even pending appeal.
If the decision of the labor arbiter is later reversed on appeal upon the finding that the ground for
dismissal is valid, then the employer has the right to require the dismissed employee on payroll
reinstatement to refund the salaries s/he received while the case was pending appeal, or it can be
deducted from the accrued benefits that the dismissed employee was entitled to receive from his/her
employer under existing laws, collective bargaining agreement provisions, and company practices.
However, if the employee was reinstated to work during the pendency of the appeal, then the
employee is entitled to the compensation received for actual services rendered without need of refund.
4F 2021-2022 47
CARAG V. NLRC April 2, 2007
FACTS: Respondents National Federation of Labor Unions (NAFLU) and Mariveles Apparel Corporation
Labor Union (MACLU) filed a complaint against Mariveles Apparel Corporation (MAC) for illegal
dismissal brought about by its illegal closure of business.
Respondent Labor Arbiter Ortiguerra summoned the complainants and MAC to a conference for
possible settlement. However, employer MAC did not appear.
In her Decision, Arbiter Ortiguerra granted complainants' motion to implead Carag (MAC’s Chairman
of the Board) and at the same time, in the same Decision, found Carag personally liable for the debts
of MAC consisting of ₱49,101,621 in separation pay to complainants.
Arbiter Ortiguerra never issued summons to Carag, never called him to a conference for possible
settlement, never required him to submit a position paper, never set the case for hearing, never notified
him to present his evidence, and never informed him that the case was submitted for decision - all in
violation of Sections 2, 3, 4, 5(b), and 11(c) of Rule V of The New Rules of Procedure of the NLRC.
ISSUE: W/N Carag was denied of due process at the arbitration level.
HELD: Yes. There was an absence of opportunity to be heard at the arbitration level, as the procedure
adopted by the Labor Arbiter prevented private respondents from explaining matters fully and
presenting their side of the controversy. They had no chance whatsoever to at least acquaint the Labor
Arbiter with whatever defenses they might have to the charge that they illegally dismissed petitioner.
In fact, private respondents presented their position paper and documentary evidence only for the
first time on appeal to the NLRC.
The essence of due process is that a party be afforded a reasonable opportunity to be heard and to
submit any evidence he may have in support of his defense. Where, as in this case, sufficient
opportunity to be heard either through oral arguments or position paper and other pleadings is not
accorded a party to a case, there is undoubtedly a denial of due process.
It is true that Labor Arbiters are not bound by strict rules of evidence and of procedure. The manner by
which Arbiters dispose of cases before them is concededly a matter of discretion. However, that
discretion must be exercised regularly, legally and within the confines of due process. They are
mandated to use every reasonable means to ascertain the facts of each case, speedily, objectively and
without regard to technicalities of law or procedure, all in the interest of justice and for the purpose of
accuracy and correctness in adjudicating the monetary awards.
Here, Carag was not issued summons, not accorded a conciliatory conference, not ordered to submit
a position paper, not accorded a hearing, not given an opportunity to present his evidence, and not
notified that the case was submitted for resolution. Thus, we hold that Arbiter Ortiguerra's Decision
is void as against Carag for utter absence of due process. It was error for the NLRC and the Court of
Appeals to uphold Arbiter Ortiguerra's decision as against Carag.
ROCA V. DABUYAN March 5, 2018 (owner/lessor of the building

impleaded after true employer absconded)
FACTS: Respondents Dabuyan, et al., filed a complaint for illegal dismissal against “RAF Mansion Hotel
Old Management and New Management and Victoriano Ewayan."
Respondents later amended the complaint and included Rolando De Roca, owner of the RAF Mansion
Hotel (building itself) as co-respondent.
4F 2021-2022 48
Despite service of summons, Petitioner De Roca did not attend the hearings, prompting the LA to render
a decision in favor of the complainants.
De Roca filed a motion to dismiss on the ground of lack of jurisdiction. He alleged that he was never an
employer of the complainants as he was merely the owner of the premises which were leased out to
and occupied by the complainant’s true employer, Victoriano Ewayan, the owner of Oceanics Travel
and Tour Agency which operated the RAF Mansion Hotel.
Labor Arbiter denied Motion to Dismiss for being filed beyond the reglementary period.
NLRC and CA denied the Petition for Annulment of Judgement (lack of jurisdiction) for being filed beyond
the reglementary period.
ISSUE:
HELD: Substantive law outweighs procedural technicalities as in this case. The labor tribunals and the
CA should have considered petitioner’s repeated pleas to scrutinize the facts and particularly the lease
agreement executed by him and Oceanic, which would naturally exculpate him from liability as this
would prove the absence of an employment relation between him and respondents. Instead, the case
was determined on pure technicality which in labor disputes, is not necessarily sanctioned –given that
proceedings before the Labor Arbiter and the NLRC are non-litigious in nature where they are
encouraged to avail of all reasonable means to ascertain the facts of the case without regard to
technicalities of law or procedure. Petitioner's motion to dismiss, though belated, should have been
given due attention.
To allow respondents to recover their monetary claims from petitioner would necessarily result in their
unjust enrichment. There is unjust enrichment ‘when a person unjustly retains a benefit to the loss of
another, or when a person retains money or property of another against the fundamental principles of
justice, equity and good conscience.’ The principle of unjust enrichment requires two conditions: (1)
that a person is benefited without a valid basis or justification, and (2) that such benefit is derived at
the expense of another. The main objective of the principle against unjust enrichment is to prevent one
from enriching himself at the expense of another without just cause or consideration.
FERNANDEZ ET. AL. V. NEWFIELDSTAFF SOLUTION July 10, 2013

FACTS: Respondent Newfield Staff Solutions, Inc. hired Fernandez as Recruitment Manager starting
September 30, 2008 with a salary of P50,000 and an allowance of P6,000 per month. Newfield also
hired
Beltran as probationary Recruitment Specialist starting October 7, 2008 with a salary of P15,000 and an
allowance of P2,000 per month.
On October 17, 2008, respondent Arnold "Jay" Lopez, Jr., Newfield’s General Manager, asked
petitioners to
come to his office and terminated their employment on the ground that they failed to perform
satisfactorily.
Lopez, Jr. ordered them to immediately turn over the records in their possession to their successors.
Petitioners filed a complaint for illegal dismissal, non-payment of salary and overtime pay,
reimbursement of cell
phone billing, moral and exemplary damages and attorney’s fees against respondents.
4F 2021-2022 49
LA RULING: ruled that petitioners’ dismissal was illegal and held Lopez, Jr. solidarily liable with Newfield.
NLRC RULING: affirmed the Labor Arbiter’s decision.
CA RULING: reversed the NLRC and dismissed petitioners’ complaint for illegal dismissal.
ISSUE: 1. Were the petitioners illegally dismissed?
2. Is Lopez, Jr., as General Manager, solidarily liable with Newfield?
HELD: 1. YES. Petitioners were illegally dismissed since there is no just cause for their dismissal.
2. NO. There is solidary liability when the obligation expressly so states, when the law so provides, or
when the nature of the obligation so requires. In MAM Realty Development Corporation v. NLRC, the
solidary liability of corporate officers in labor disputes was discussed in this wise:
"A corporation, being a juridical entity, may act only through its directors, officers and employees.
Obligations incurred by them, acting as such corporate agents, are not theirs but the direct
accountabilities of the corporation they represent. True, solidary liability may at times be incurred but
only when exceptional circumstances warrant such as, generally, in the following cases:
1. When directors and trustees or, in appropriate cases, the officers of a corporation –
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;
xxxx
In labor cases, for instance, the Court has held corporate directors and officers solidarily liable with the
corporation for the termination of employment of employees done with malice or in bad faith."
Bad faith does not connote bad judgment or negligence; It Imports dishonest purpose or some moral
obliquity and conscious doing of wrong; it means breach of a known duty through some motive or
interest or ill will; it partakes of the nature of fraud. To sustain such a finding, there should be evidence
on record that an officer or director acted maliciously or in bad faith in terminating the employee. But
here, the Labor Arbiter and NLRC have not found Lopez, Jr. guilty of malice or bad faith. Thus, there is
no basis to hold Lopez, Jr. solidarily liable with Newfield. Payment of the judgment award is the direct
accountability of Newfield.
RELIEFS AGAINST JUDGMENTS/DECISIONS RENDERED BY THE COMMISSION

PETITION FOR CERTIORARI UNDER RULE 65
ST. MARTIN FUNERAL HOMES V. NLRC September 16, 1998 (Rule 65 to CA First Before
SC)
FACTS: This is an illegal dismissal case filed by private respondent Arcayos against St Martin Funeral.
There was an allegation of misappropriation funds but Arcayos alleged that the money was actually
paid to BIR as payment for St Martin’s taxes.
Arcayos then filed a complaint against St Martin before LA. Here, St Martin contended that Arcayos is
not its employee because they did not have an ER-EE contract. LA then ruled in favor of St Martin.
Arcayos appealed to NLRC. NLRC dismissed the appeal. An MR to NLRC was also denied.
Arcayos then filed a petition for certiorari before SC contending that NLRC erred in dismissing his
appeal.
4F 2021-2022 50
ISSUE:
HELD: The petition for certiorari under Rule 65 is indeed the correct remedy to review the decision of
NLRC, there being no further appeal available to the respondent. However, in accordance with the
principle of hierarchy of courts, the certiorari must have been filed before the CA first.
The case was remanded to CA.
VELOSO V. CHINA AIRLINES July 14, 1999 (MR to NLRC First Before Rule 65
to CA)
FACTS: Veloso and other staff of China Airlines ticketing office in Manila were at first, temporarily laid
off from work when CAL temporarily shut down the operations due to business losses. Eventually, the
temporary closure became permanent.
An illegal dismissal and unfair labor practice was filed with LA.
LA ruled in favor of Veloso and other staff.
Appeal to NLRC – affirmed the decision of the LA.
CAL then filed a petition for certiorari under Rule 65 before CA contending that there was grave abuse
of discretion on the part of NLRC.
ISSUE:
HELD: The petition for certiorari warrants outright dismissal because as a rule, it is an indispensable
requirement to file a motion for reconsideration first to afford NLRC a chance to review and rectify any
errors in its decision. Further, the MR must be filed within 10 days otherwise the decision of NLRC
becomes final and executory, hence, the Court will no longer have other recourse but to sustain such
decision or order.
APPEAL OF THE CA DECISION TO THE SC

STANFILCO V. TEQUILLO July 17, 2019 (MR to NLRC First Before Rule 65
to CA)
FACTS: Tequillo was dismissed from work when he mauled a co-worker and was caught in a drinking
spree during a supposed meeting/activity being conducted by Stanfilco.
LA ruled that Tequillo was LEGALLY dismissed. NLRC reversed ruling and held that he was illegally
dismissed.
MR to NLRC was denied then certiorari to CA – CA affirmed NLRC.
Petitioner then filed a petition for review on certiorari (Rule 45) to SC.
ISSUE:
HELD: The power of SC to review under Rule 45 is limited to questions of law. In labor cases, the Court
enquires into the legal correctness of the CA's determination of the presence or absence of grave abuse
of discretion in the NLRC decision.
On merits – the SC held that he was legally dismissed as the attack was rooted from workplace
dynamics. The NLRC and CA failed to appreciate the rule that in deciding whether a workplace fight is
a valid ground for termination, and when the rule regarding time and place of fight happened is
4F 2021-2022 51
insufficient to determine the same, the rule is that the fight must have rooted from a workplace
connected issue.
Notes: In this case, the failure of NLRC and CA to appreciate these facts resulted to grave abuse of
discretion. – Rule 45 correctly exercised by SC!
HANJIN ENGINEERING V. CA April 10, 2006 (Rule 65 to CA then Rule 45 to SC)

FACTS: About 712 laborers contracted by Hanjin Engineering for the construction of Malinao Dam filed
illegal dismissal case with LA when they were terminated from their work. Hanjin on the other hand,
contended that they were merely project employees.
The LA favored the laborers.
Hanjin appealed to NLRC. This was denied by NLRC. An MR was also denied.
Hanjin filed a petition for certiorari before CA. When again, it was denied, Hanjin again filed petition for
certiorari under Rule 65 (again!) with SC.
ISSUE:
HELD: The petition for certiorari filed before SC is erroneous. When a decision of CA is rendered
concerning Rule 65 petition for certiorari, and a review of same is sought, the proper petition is under
Rule 45 – petition for review on certiorari – before the SC.
These are mutually exclusive. No petition for review on certiorari (45) will issue unless petition for
certiorari (65) has issued. The Rule 65 cannot be a substitute for an appeal when a plain, speedy and
adequate remedy is still available.
ART. 232 [226]. BUREAU OF LABOR RELATIONS

EMPLOYEES UNION OF BAYER PHILS. V. BAYER Dec. 6, 2010
PHILS
FACTS: EUBP is the SEBA of all RAF employees of Bayer and is affiliated with FFW. During the negotiation
of EUBP and Bayer, EUBP rejected the 9.9% wage increase proposal of Bayer resulting in a deadlock.
Subsequently, EUBP staged a strike prompting SOLE to assume jurisdiction over the dispute.
A new CBA was executed pursuant to the arbitral award of DOLE. After 6 months from the signing of
the new CBA, Remigio collected signatures from union members to rename the union to REUBP and to
adopt new constitution and by-laws.
Remigio asked Bayer to desist from transacting with EUBP. Facundo, President of EUBP, requested
Bayer to remit the union dues in favor of EUBP.
Initially, Bayer decided not to deal with either groups and placed the union dues collected in a trust
account.
EUBP filed the first ULP complaint against Bayer for non-remittance of union dues.
Bayer thereafter decided to turn over the collected union dues to the treasurer of REUBP.
EUBP filed the 2nd ULP complaint against Bayer charging the latter with ULP committed by organizing
a company union, gross violation of the CBA and violation of their duty to bargain.
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The ULP complaints were dismissed for lack of jurisdiction. NLRC sustained, and the CA affirmed the LA
and NLRC.
ISSUE: Whether the NLRC has jurisdiction over the case.
HELD: The issues raised by petitioners do not fall under any of the aforementioned circumstances
constituting an intra-union dispute. The petitioners do not seek a determination of whether it is the
Facundo group (EUBP) or the Remigio group (REUBP) which is the true set of union officers. Instead,
the issue raised pertained only to the validity of the acts of management in light of the fact that it still
has an existing CBA with EUBP. Thus as to Bayer, Lonishen and Amistoso the question was whether
they were liable for unfair labor practice, which issue was within the jurisdiction of the NLRC. The
dismissal of the second ULP complaint was therefore erroneous.
However, as to respondents Remigio and Villareal, we find that petitioners’ complaint was validly
dismissed.
Petitioners’ ULP complaint cannot prosper as against respondents Remigio and Villareal because the
issue, as against them, essentially involves an intra-union dispute based on Section 1 (n) of DOLE
Department Order No. 40-03. To rule on the validity or illegality of their acts, the Labor Arbiter and the
NLRC will necessarily touch on the issues respecting the propriety of their disaffiliation and the legality
of the establishment of REUBP - issues that are outside the scope of their jurisdiction. Accordingly, the
dismissal of the complaint was validly made, but only with respect to these two respondents.
MONTAÑO V. VERCELES July 26, 2010

FACTS: Atty. Montao was a candidate for national vice president position of FFW. He was initially
disqualified for the position because of allegations of violations of the Constitution and By Laws.
However, during election, Atty. Montao was eventually allowed to participate and he actually won the
vice presidency position.
Respondent, a delegate of the convention, filed a petition for nullification of the election of Atty
Montao before the BLR. Atty. Montao contested the jurisdiction of BLR.
ISSUE:
HELD: The BLR has jurisdiction as this is a matter involving intra-union disputes among federation
members.
The contention that the petition should have been dismissed by BLR due to pending contest before the
FFW COMELEC is not meritorious. The contest was filed BEFORE Montao was elected. However, FFW
allowed Montao to continue with his candidacy despite the contest and even proclaimed him as winner.
It would show that Atty. Verceles have exhausted his remedies when after the proclamation, he then
again filed a protest and asked for a hearing. FFW failed to act upon it which warrants Atty. Verceles’
act of filing petition before the BLR proper.
DIOKNO ET AL. V. CACDAC July 4, 2007

FACTS: FLAMES, the supervisory union of Meralco, conducted an election where Diokno was
proclaimed as President.
4F 2021-2022 53
Before Diokno was proclaimed, FLAMES rejected the candidacy of Ong and the others. It was alleged
that Ong and his companions colluded with non-member officers of the company to exert undue
influence to FLAMES members concerning the election.
Ong, et al filed a petition before the Med-arbitration of DOLE to nullify the said order rejecting their
candidacy.
Med-Arb ruled in favor of Ong. BLR affirmed the decision of Med-Arb. CA upheld BLR.
Petitioners now contended that Ong failed to exhaust administrative remedies first, which prevented
BLR from acquiring jurisdiction. Further, that the matter involves other non-members, hence, the BLR
has no jurisdiction.
ISSUE:
HELD: The BLR has jurisdiction. The issue involves and intra-union dispute. The non-members were not
even a party to the proceedings, which would not prevent BLR from acquiring jurisdiction.
The rule of exhaustion of administrative remedies finds no application in this case anymore since Ong,
et al is shown to have addressed their concerns to FLAMES, but was not acted upon. To insist them to
continue exhausting the remedies available under the By Laws of the union would prove to be illusory
and in vain.
LA TONDEÑA WORKERS UNION V. SECRETARY OF December 9, 1994

LABOR
FACTS: Members of the LTWU filed a petition before DOLE-NCR to have the financial and account books
of petitioner union be examined and inspected.
After the inspection, Dela Cruz and Marin were found to be accountable for 300k union dues.
Dela Cruz and Marin appealed to SOLE as they were not accorded due process when the report was
made.
SOLE endorsed to BLR. BLR then found Dela Cruz and Marin accountable. The Union was then ordered
to submit all financial records to BLR.
Union contested the jurisdiction of BLR claiming that it is the SOLE which has jurisdiction to demand
financial documents.
ISSUE:
HELD: ARGUMENT: That the intra-union dispute falling within the jurisdiction of BLR does not include
examination of accounts of the union.
Conflicts affecting labor-management, aside from intra-union disputes, also falls within the jurisdiction
of the BLR. The question of initiation – since only 20% of the members signed – the 30% requirements
too effect 7 days after the petition was filed. Hence, at the time of the filing, the 20% is still valid.
ABBOT LABORATORIES V. ABBOT LABORATORIES January 26, 2000

EMPLOYEE UNION
FACTS: Respondent union consisting of 30 rank-and-file employees filed an application for union
registration before DOLE. They sought to represent the manufacturing unit of the company.
4F 2021-2022 54
BLR approved the application.
Petitioner company filed a petition for cancellation of the registration certificate. Among others, it
contended that there is no sufficient basis for a new union to be formed (may union na kasi for ibang
staff and employees…)
Regional Director (RD) affirmed cancellation.
Union appealed to DOLE Secretary. DOLE Secretary the referred the matter to Director of BLR.
The Director of BLR then favored the union. The company appealed to DOLE Secretary, which dismissed
the case on the grounds that SOLE does not have APPELLATE jurisdiction over the decisions rendered
by BLR.
ISSUE:
HELD: There was no grave abuse of discretion when SOLE refused to hear the appeal filed by Abbott.
The SOLE does not have appellate jurisdiction over the decisions rendered by BLR in its appellate
jurisdiction. The SOLE’s appellate jurisdiction is limited to those decisions of BLR in the exercise of its
exclusive, original jurisdiction – such decisions are deemed final and executory.
TAKATA CORPORATION V. BLR June 4, 2014

FACTS: Takata Philippines Corp sought the cancellation of SALAMAT’s certificate of registration as LLO
on grounds of fraud and misrepresentation. It filed a petition for cancellation before DOLE Regional
Office.
RD granted the cancellation.
An appeal was filed with BLR. Simultaneously, an appeal was also filed with SOLE, which was then
referred by the Secretary to BLR. – this was removed din sa issues kasi yung 1st person na nagfile ng
appeal sa BLR is unauthorized person naman ng Union.
So the appeal referred motu proprio by SOLE to BLR was left pending (yung second appeal) – BLR’s
decision was in favor of the Union.
MR to BLR was denied so Takata filed certiorari (rule 65) to CA. CA affirmed the decision of BLR.
Issue is that there was forum shopping but the appellants were allowed DAW to choose which appeal
to pursue.
ISSUE:
HELD: Again, there was no forum shopping because the first appeal was without effect since it was filed
by an unauthorized person.
Now, they cited again the case of Abbott because SOLE in a sense, exercised appellate jurisdiction (kaya
lang nirefer nya nga sa BLR)
In Abbott case: RD > BLR > SOLE = not allowed because BLR exercised appellate jurisdiction already,
which should be final and executory, unless Rule 65 certiorari is filed. But in such flow, the SOLE cannot
review the BLR’s appellate decision.
In this case: RD > SOLE but referred to BLR > Certiorari to CA = this is the correct flow. The decision of
RD is appealable to SOLE, but in this case, nag-refer lang si SOLE kay BLR so si BLR nag-rule!
4F 2021-2022 55
ART. 233 [227]. COMPROMISE AGREEMENTS
MAGBUANA V. UY May 6, 2005
FACTS: After a final judgment awarding the monetary claims to workers, parties entered into a
compromise agreement where workers signed manifestations that they have fully received the amount
due to them, and that they waive any other benefits.
Workers then filed a writ of execution alleging that they were only paid in partial amounts.
Employer said they have already signed the manifestations.
ISSUE:
HELD: A compromise agreement signed AFTER a final judgment is still valid and binding as long as it is
approved by LA and it is entered into by the parties freely.
Also the fact that the signing was made in the absence of LA does not affect its validity as long as the
same was signed freely and approved by LA after.
PHILIPPINE TRANSMARINE CARRIER V. PELAGIO August 12, 2015

FACTS: Pelagio was a motorman in a vessel managed by petitioner (?). While at work, he suffered
difficulty in breathing, back pains, etc.
After 2 consultations, he was diagnosed to have lost his lifting power of the trunk, which rendered him
unfit for work.
He claimed total permanent disability benefits to no avail. LA and NLRC rendered decision in his favor.
While a certiorari is pending before CA, the parties agreed for payment of the judgment award rendered
by NLRC and Pelagio signed acknowledgment and documents as receipt but without prejudice to the
certiorari - that the amount will be returned to the PTC if judgment is in favor of them.
CA tho said the Agreement rendered the case moot and academic.
ISSUE:
HELD: Compromise agreements generally have the effect of res judicata among parties, thus rendering
the matter moot and academic. However, parties may insert provisions which would not prejudice
further legal actions - in this case, the agreement was conditional upon the return of the money if the
CA renders a judgment in favor of PTC.
Hence, the case is not moot and academic.
MAGSAYSAY MARITIME V. DE JESUS August 30, 2017

FACTS: De Jesus was employed by Magsaysay when he suffered from aneurysm and eventually died.
His widow claimed for his death benefits.
During the pendency of an appeal by certiorari before the CA, Magsaysay paid De Jesus as agreed upon
in a compromise agreement.
CA rendered the case moot and academic.
ISSUE:
4F 2021-2022 56
HELD: As opposed to the decision in Pelagio, the SC did not render the case moot and academic because
the conditional arrangement was for Pelagio to return the money in case of a favorable decision in favor
of PTC.
Here, the condition stated is that De Jesus will have to return whatever was received plus she will no
longer seek redress in case of a favorable decision to Magsaysay. The agreement which prohibits De
Jesus to further seek redress rendered the case moot and academic.
SOLOMON ET. AL. V. POWERTECH CORP. January 22, 2008

FACTS: Nagkakaisang Manggagawa sa Powertech filed a case for illegal dismissal. The case was
dismissed as to 27 employees for their quitclaim, while it continued for the 25. Later on, the LA declared
the dismissal illegal as to 20 employees and ordered the payment of 2.5 million.
Powertech appealed. During the pendency of appeal, Carlos Gestiada (representative of the workers
via special power of attorney) entered into a compromise agreement with Powertech for an amount of
150k. The check however bounced due to stop payment order of Powertech. NLRC declared the
compromise void.
Later, Powertech paid to Gestiada the 150k. A joint motion to dismiss was filed by Gestiada and
Powertech.
ISSUE:
HELD: While it may be true that Gestiada represented the other workers as provided by the SPA, the
circumstances points to the fact that the 150k paid to Gestiada was only for his backwages. First, the
judgment award was 2.5 million; 150k is a meager sum wherein each worker will receive only 6k each.
Second, the workers did not receive a single centavo from the 150k. Lastly, Powertech and Gestiada
collided; collusion being a specie of fraud, the compromise is void.
PHILIPPINE JOURNALISTS INC. V. NLRC September 5, 2006

FACTS: PJI implemented a retrenchment program. The affected employees filed a notice to strike. The
case was referred to the NLRC for compulsory arbitration. The NLRC ruled that the employees were
illegally dismissed and ordered the reinstatement of the employees and payment amounting to 6
million.
PJI entered into a compromise agreement with the employees. The case was later on dismissed by
NLRC. Later on, the Union filed a notice of strike. The case was referred to NLRC. PJI argues that the
case is already moot because of compromise agreement.
ISSUE:
HELD: A compromise agreement requires the consent of the individual parties. A compromise
agreement entered with members of the union binds only those who are party thereto. Those who did
not consent to the compromise are not bound by the compromise. The case is not yet moot and
academic as to them.
PERIQUET V. NLRC June 22, 1990
4F 2021-2022 57
FACTS: Petitioner was a toll collector dismissed by CDCP when unaccounted toll tickets were found in
her purse. In the illegal dismissal case, they ended up having a compromise agreement where she
received the sum of 14k out of the 205k judgment award, she also signed the quitclaim.
When she was rehired, she wrote a letter to the new management of CDCP asking for payment of the
remaining balance - she was paid another 9k and she again signed a quitclaim.
Despite signing both quitclaims, after 9 years, she brought an action for enforcement of the previous
judgment award claiming that she has been tricked into signing both quitclaims.
ISSUE:
HELD: Court held that there are clear indications that the petitioner simply changed her mind and now
seeking the enforcement of the judgment award. As the quitclaims were signed voluntarily, and that
the amounts paid were reasonable, said agreements and quitclaims are valid and cannot be nulled just
because petitioner has changed her mind.
AUJERO V. PHILCOMSAT January 18, 2012

FACTS: Aujero retired after 15 years of service with PHILCOMSAT. She received the amount of 9M pesos
as retirement benefits and signed waivers and quitclaims.
3 years after, she filed an action seeking to nullify the waiver and quitclaim alleging that the supposed
amount of her retirement benefit is 14M. She said the amount in unconscionable and that she was
forced to sign due to her immediate needs of the money.
ISSUE:
HELD: A waiver and quitclaim, although frowned upon by law, are valid if signed freely and voluntarily
shall be respected.
The urgent need of money does not constitute the pressure or coercion contemplated by law, which
would render the waiver and quitclaim null and void.
CAROLINA’S LACE SHOPPE V. MAQUILAN April 10, 2019

FACTS: After an inspection by DOLE finding Carolina’s Lace, respondents who were employees of
petitioners were asked to submit their resignation, receive their separation pay and sign waivers and
quitclaims.
They filed an illegal dismissal case.
ISSUE:
HELD: The resignation letters in the form of quitclaims are worded in a manner that free the employer
from liabilities, thus gives impression that there lacks voluntariness on the part of the resigning
employees.
ART. 238 [232]. PROHIBITION ON CERTIFICATION ELECTION

COLEGIO DE SAN JUAN DE LETRAN V. ASSOCIATION September 18, 2000
OF EMPLOYEES AND FACULTY OF LETRAN ET. AL.
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FACTS: Respondent union and the petitioner school had a CBA effective from 1989 to 1994. In 1992,
the President of the respondent union initiated the renegotiation of the CBA. The parties was not able
to have an agreement, thus the CBA was unsigned. In 1996, parties agreed to disregard the unsigned
CBA. Renegotiations resumed. However, petitioner school refused to continue the negotiation since
another union filed a petition for certification election.
ISSUE:
HELD: In order to stop negotiations by employer, a valid petition for certification election must first be
filed. A valid petition for certification election is one which follows the rules laid down under the law.
In particular, if a CBA exists, the petition can only be filed during the freedom period which is within 60
days before the expiration of the CBA. This is called the Contract Bar Rule. In this case, the petition was
filed on May 1996. The duration of the CBA was from 1989 to 1994. Clearly, the petition was filed
beyond the freedom period.
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MODULE 2
ART. 240 [234]. REQUIREMENTS OF REGISTRATION
MARIWASA SIAM CERAMICS, INC. V. SEC OF LABOR December 21, 2009
FACTS: Respondent Samahan Ng Mga Manggagawa Sa Mariwasa Siam Ceramics, Inc. was issued a
Certificate of Registration as a legitimate labor organization by the DOLE, Region IV-A.
Petitioner Mariwasa Siam Ceramics, Inc. filed a Petition for Cancellation of Union Registration against
respondent, claiming that the latter violated Article 234 of the Labor Code for not complying with the
20% requirement, and that it committed massive fraud and misrepresentation in violation of Article
239 of the same code.
The Regional Director of DOLE IV-A issued an Order granting the petition, revoking the registration of
respondent, and delisting it from the roster of active labor unions.
ISSUE: Whether the 20% membership requirement shall be maintained after the application of the
union.
HELD: No. The legitimacy of respondent as a labor organization must be affirmed. While it is true that
the withdrawal of support may be considered as a resignation from the union, the fact remains that at
the time of the union's application for registration, the affiants were members of respondent and they
comprised more than the required 20% membership for purposes of registration as a labor union.
Article 234 of the Labor Code merely requires a 20% minimum membership during the application for
union registration. It does not mandate that a union must maintain the 20% minimum membership
requirement all throughout its existence.
ELECTROMAT MANUFACTURING AND RECORDING July 27, 2011 (only related to Article 234)
CORPORATION V. LAGUNZAD ET. AL.
FACTS: The private respondent Nagkakaisang Samahan ng Manggagawa ng Electromat-Wasto (union)
applied for registration with the Bureau of Labor Relations (BLR).
The BLR thereafter issued the union a Certification of Creation of Local Chapter (equivalent to the
certificate of registration of an independent union), pursuant to Department Order No. (D.O.) 40-03.
The petitioner Electromat Manufacturing and Recording Corporation (company) filed a petition for
cancellation of the union's registration certificate, for the union's failure to comply with Article 234 of
the Labor Code. It argued that D.O. 40-03 is an unconstitutional diminution of the Labor Code's union
registration requirements under Article 234.
ISSUE: Whether D.O. 40-03 is a valid exercise of the rule-making power of the DOLE.
HELD: Yes. We see nothing contrary to the law or the Constitution in the adoption by the Secretary of
Labor and Employment of D.O. 40-03 as this department order is consistent with the intent of the
government to encourage the affiliation of a local union with a federation or national union to enhance
the local's bargaining power. If changes were made at all, these were those made to recognize the
distinctions made in the law itself between federations and their local chapters, and independent
unions; local chapters seemingly have lesser requirements because they and their members are
deemed to be direct members of the federation to which they are affiliated, which federations are the
ones subject to the strict registration requirements of the law.
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EAGLE RIDGE GOLF AND COUNTRY CLUB V. CA March 18, 2010 (old law)
FACTS: At least 20% of Eagle Ridge's rank-and-file employees — the percentage threshold required
under Article 234 (c) of the Labor Code for union registration — had a meeting where they organized
themselves into an independent labor union, named "Eagle Ridge Employees Union" (EREU or Union),
elected a set of officers, and ratified their constitution and by-laws.
Eagle Ridge alleged that the EREU declared in its application for registration having 30 members, when
the minutes of its organizational meeting showed it only had 26 members. The misrepresentation was
exacerbated by the discrepancy between the certification issued by the Union secretary and president
that 25 members actually ratified the constitution and by-laws and the fact that 26 members affixed
their signatures on the documents, making one signature a forgery.
Finally, Eagle Ridge contended that five employees who attended the organizational meeting had
manifested the desire to withdraw from the union. The five executed individual affidavits attesting that
they arrived late at said meeting which they claimed to be drinking spree; that they did not know that
the documents they signed on that occasion pertained to the organization of a union; and that they
now wanted to be excluded from the Union. The withdrawal of the five, Eagle Ridge maintained,
effectively reduced the union membership to 20 or 21, either of which is below the mandatory
minimum 20% membership requirement under Art. 234 (c) of the Labor Code. Reckoned from 112 rank-
and-file employees of Eagle Ridge, the required number would be 22 or 23 employees.
ISSUE: Whether the 20% membership requirement is complied with by the union. – YES
HELD: Yes. The fact that six union members, indeed, expressed the desire to withdraw their
membership through their affidavits of retraction will not cause the cancellation of registration on the
ground of violation of Art. 234 (c) of the Labor Code requiring the mandatory minimum 20%
membership of rank-and-file employees in the employees' union.
Twenty percent (20%) of 112 rank-and-file employees in Eagle Ridge would require a union membership
of at least 22 employees (112 x 205 = 22.4). When the EREU filed its application for registration on
December 19, 2005, there were clearly 30 union members. Thus, when the certificate of registration
was granted, there is no dispute that the Union complied with the mandatory 20% membership
requirement.
CERTIFICATE OF REGISTRATION OF A LABOR ORGANIZATION

TAGAYTAY HIGHLANDS INTERNATIONAL GOLF January 22, 2003
CLUB INC. V. TAGAYTAY HIGHLANDS EMPLOYEES
UNION PGTWO
FACTS: Tagaytay Highlands Employees Union (THEU) — Philippine Transport and General Workers
Organization (PTGWO) filed for certification election before the DOLE Mediation-Arbitration Unit.
Petitioner opposed THEU’s petition for certification election on the ground that the list of union
members submitted by it was defective as it includes supervisors as well as employees of another
company. Petitioner also alleged that some of the signatures in the list of union members were secured
through fraudulent and deceitful means.
THEU asserted that it had complied with all the requirements for valid affiliation and inclusion in the
roster of legitimate labor organizations pursuant to DOLE D.O. No. 9, series of 1997, and that it was
duly granted a Certification of Affiliation by DOLE, and said Department Order provides that the
4CEF 2021-2022 4
legitimacy of its registration cannot be subject to collateral attack, and for as long as there is no final
order of cancellation, it continues to enjoy the rights accorded to a legitimate organization.
Med-Arbiter Anastacio Bactin ordered the holding of a certification election
ISSUE: Whether the legal personality of a union may be questioned in a petition for certification election
- NO
HELD: No. After a certificate of registration is issued to a union, its legal personality cannot be subject
to collateral attack. It may be questioned only in an independent petition for cancellation in accordance
with Section 5 of Rule V, Book IV of the Implementing Rules. THEU, having been validly issued a
certificate of registration, should be considered to have already acquired juridical personality which
may not be assailed collaterally. The proper procedure for petitioner is to file a petition for cancellation
of the certificate of registration, and not to intervene in certification election.
REPUBLIC OF THE PHILS. V. KAWASHIMA TEXTILE July 23, 2008

MANUFACTURING
FACTS: KFWU filed with DOLE Regional Office No. IV, a Petition for Certification Election to be
conducted in the bargaining unit composed of 145 rank-and-file employees of respondent. Respondent
filed a Motion to Dismiss the petition on the ground that KFWU did not acquire any legal personality
because its membership of mixed rank-and-file and supervisory employees violated Article 245 of the
Labor Code, and its failure to submit its books of account contravened the ruling of the Court in
Progressive Development Corporation v. Secretary, DOLE.
Med-Arbiter: Petitioner should first exclude the supervisory employees from its membership before it
can attain the status of a legitimate labor organization.
DOLE: Reversed MedArb Decision.
CA: Reversed DOLE decision. Since respondent union clearly consists of both rank and file and
supervisory employees, it cannot qualify as a legitimate labor organization imbued with the requisite
personality to file a petition for certification election.
ISSUES:
1. Whether a mixed membership of rank-and-file and supervisory employees in a union is a ground
for the dismissal of a petition for certification election. – NO
2. Whether the legitimacy of a duly registered labor organization can be collaterally attacked in a
petition for a certification election through a motion to dismiss filed by an employer. - NO
HELD:
1. Under Section 9 of R.A. 9481, a new provision, Article 245-A is inserted into the Labor Code [See:
Art. 256 of present Labor Code] Moreover, under Section 4, a pending petition for cancellation of
registration will not hinder a legitimate labor organization from initiating a certification election,
[See: Art. 246 of present Labor Code] However, R.A. No. 9481 took effect only on June 14, 2007;
hence, it applies only to labor representation cases filed on or after said date. As the petition for
certification election subject matter of the present petition was filed by KFWU on January 24,
2000, R.A. No. 9481 cannot apply to it. Instead, the law and rules in force at the time of the filing
by KFWU of the petition for certification election on January 24, 2000 are R.A. No. 6715 and its IRR.
(Note: Madaming cases ang na cite ng court dito for the discussion on issue of the effect of
“commingling” e.g. Tagaytay Highlands, San Miguel and Air Philippines cases. In Tagaytay, SC
4CEF 2021-2022 5
abandoned the view in Toyota and Dunlop and reverted to its pronouncement in Lopez that while there
is a prohibition against the mingling of supervisory and rank-and-file employees in one labor
organization, the Labor Code does not provide for the effects thereof. Thus, the Court held that any
mingling between supervisory and rank-and-file employees in its membership cannot affect its
legitimacy for that is not among the grounds for cancellation of its registration, unless such mingling
was brought about by misrepresentation, false statement or fraud under Art. 239 of the Labor Code.)
In short, SC ruled: Consequently, the Court reverses the ruling of the CA and reinstates that of the
DOLE granting the petition for certification election of KFWU.
2. Except when it is requested to bargain collectively, an employer is a mere bystander to any
petition for certification election; such proceeding is non-adversarial and merely investigative, for
the purpose thereof is to determine which organization will represent the employees in their
collective bargaining with the employer. The choice of their representative is the exclusive concern
of the employees; the employer cannot have any partisan interest therein; it cannot interfere with,
much less oppose, the process by filing a motion to dismiss or an appeal from it; not even a mere
allegation that some employees participating in a petition for certification election are actually
managerial employees will lend an employer legal personality to block the certification election.
The employer's only right in the proceeding is to be notified or informed thereof.
ARTS. 245-248 [238-239]. CANCELLATION OF REGISTRATION

HERITAGE HOTEL MANILA V. NUWHRAIN-HHMSC January 12, 2011
FACTS: Respondent National Union of Workers in Hotel Restaurant and Allied IndustriesHeritage Hotel
Manila Supervisors Chapter (NUWHRAIN-HHMSC) filed a petition for certification election seeking to
represent ALL SUPERVISORY EMPLOYEES Heritage of Hotel Manila. The Med-Arbiter approved the pre-
election. However, the certification election was delayed, but pushed through nonetheless. Petitioner
filed for cancellation of the certification due to the failure of respondent to submit its financial
statements to the Bureau of Labor Relations. The Med-Arbiter still ruled in favor of respondents.
Petitioner appealed the decision to the regional director of the DOLE. The Regional director still
rendered a decision in favor of respondents, which prompted petitioners to appeal the decision to the
director of the Bureau of Labor Relations. The director of the BLR inhibited from the issue, as he was
previously the counsel of respondents. The Regional Director of DOLE-NCR and DOLE Secretary both
held that constitutionally guaranteed freedom of association and right of workers to self-organization
outweighed respondent’s noncompliance with the statutory requirements to maintain its status as a
legitimate labor organization.
ISSUE: W/N the failure to comply with the statutory requirement (filing financial reports and list of its
members) is a sufficient ground for the cancellation of registration of respondent as a labor union. –
NO
HELD: The non-compliance should not be a ground for the cancellation. Articles 238 and 239 of the
Labor Code provide that failure to file financial reports and the list of its members are grounds for the
cancellation of Union Organization. However, consideration must be taken of the fundamental rights
guaranteed by Article XIII, Section 3 of the Constitution, i.e., the rights of all workers to self-
organization, collective bargaining and negotiations, and peaceful concerted activities. Labor
authorities should bear in mind that registration confers upon a union the status of legitimacy and the
concomitant right and privileges granted by law to a legitimate labor organization, particularly the right
to participate in or ask for certification election in a bargaining unit. Thus, the cancellation of a
4CEF 2021-2022 6
certificate of registration is the equivalent of snuffing out the life of a labor organization. For without
such registration, it loses – as a rule – its rights under the Labor Code.
Furthermore, the Labor Code’s provisions on cancellation of union registration and on reportorial
requirements have been recently amended by Republic Act (R.A.) No. 9481, An Act Strengthening the
Workers’ Constitutional Right to Self-Organization, Amending for the Purpose Presidential Decree No.
442, As Amended, Otherwise Known as the Labor Code of the Philippines, which says that failure to file
financial reports and list of union members shall not be a ground for cancellation of union registration
but shall subject the erring officers or members to suspension, expulsion from membership, or any
appropriate penalty.
REPUBLIC OF THE PHILS. V. KAWASHIMA TEXTILE July 23, 2008

MANUFACTURING
FACTS: KFWU filed with DOLE Regional Office No. IV, a Petition for Certification Election to be
conducted in the bargaining unit composed of 145 rank-and-file employees of respondent. Respondent
filed a Motion to Dismiss the petition on the ground that KFWU did not acquire any legal personality
because its membership of mixed rank-and-file and supervisory employees violated Article 245 of the
Labor Code, and its failure to submit its books of account contravened the ruling of the Court in
Progressive Development Corporation v. Secretary, DOLE.
Med-Arbiter: Petitioner should first exclude the supervisory employees from its membership before it
can attain the status of a legitimate labor organization.
DOLE: Reversed MedArb Decision.
CA: Reversed DOLE decision. Since respondent union clearly consists of both rank and file and
supervisory employees, it cannot qualify as a legitimate labor organization imbued with the requisite
personality to file a petition for certification election.
ISSUES:
1. Whether a mixed membership of rank-and-file and supervisory employees in a union is a ground
for the dismissal of a petition for certification election. – NO
2. Whether the legitimacy of a duly registered labor organization can be collaterally attacked in a
petition for a certification election through a motion to dismiss filed by an employer. - NO
HELD:
1. Under Section 9 of R.A. 9481, a new provision, Article 245-A is inserted into the Labor Code [See:
Art. 256 of present Labor Code] Moreover, under Section 4, a pending petition for cancellation of
registration will not hinder a legitimate labor organization from initiating a certification election,
[See: Art. 246 of present Labor Code] However, R.A. No. 9481 took effect only on June 14, 2007;
hence, it applies only to labor representation cases filed on or after said date. As the petition for
certification election subject matter of the present petition was filed by KFWU on January 24,
2000, R.A. No. 9481 cannot apply to it. Instead, the law and rules in force at the time of the filing
by KFWU of the petition for certification election on January 24, 2000 are R.A. No. 6715 and its IRR.
(Note: Madaming cases ang na cite ng court dito for the discussion on issue of the effect of
“commingling” e.g. Tagaytay Highlands, San Miguel and Air Philippines cases. In Tagaytay, SC
abandoned the view in Toyota and Dunlop and reverted to its pronouncement in Lopez that while there
is a prohibition against the mingling of supervisory and rank-and-file employees in one labor
organization, the Labor Code does not provide for the effects thereof. Thus, the Court held that any
4CEF 2021-2022 7
mingling between supervisory and rank-and-file employees in its membership cannot affect its
legitimacy for that is not among the grounds for cancellation of its registration, unless such mingling
was brought about by misrepresentation, false statement or fraud under Art. 239 of the Labor Code.)
In short, SC ruled: Consequently, the Court reverses the ruling of the CA and reinstates that of the
DOLE granting the petition for certification election of KFWU.
2. Except when it is requested to bargain collectively, an employer is a mere bystander to any
petition for certification election; such proceeding is non-adversarial and merely investigative, for
the purpose thereof is to determine which organization will represent the employees in their
collective bargaining with the employer. The choice of their representative is the exclusive concern
of the employees; the employer cannot have any partisan interest therein; it cannot interfere with,
much less oppose, the process by filing a motion to dismiss or an appeal from it; not even a mere
allegation that some employees participating in a petition for certification election are actually
managerial employees will lend an employer legal personality to block the certification election.
The employer's only right in the proceeding is to be notified or informed thereof.
ART. 250 [241]. RIGHTS AND CONDITIONS OF MEMBERSHIP IN A LABOR ORGANIZATION

DEL PILAR ACADEMY ET. AL. V. DEL PILAR April 30, 2008
ACADEMY’S EMPLOYEE’S UNION
FACTS: Del Pilar Academy Employees Union is the certified collective bargaining representative of
teaching and non-teaching personnel of petitioner Del Pilar Academy. The Union and Del Pilar entered
into a CBA. The Union then assessed agency fees from non-union ees and requested Del Pilar to deduct
said assessment from employees’ salaries. Del Pilar refused, saying the non-union employees were not
amenable to it. Moreover, Del Pilar refused to renew the CBA unless the provision regarding
entitlement to two(2) months summer vacation leave with pay will be amended by LIMITING THE SAME
TO TEACHERS, who have rendered at least 3 consecutive academic years of satisfactory service. Such
refusal of CBA resulted to deadlock. Del Pilar refused to submit the case for voluntary arbitration.
Hence, the Union filed a case for unfair labor practice with the LA.
ISSUE: can the union collect agency fees from non-union members even without a written authorization
and thus constituting a valid check off? – YES
HELD: The grant of annual salary increase is not the only provision in the CBA that benefited the non-
union employees. The union negotiated for other benefits as well that SURELY BENEFITED THE NON-
UNION employees, justifying the collection of and the union’s entitlement to, agency fees. Hence, no
requirement of written authorization from non-union ees is needed to effect a valid check off. Art.
259(e) makes it explicit that Art. 250 (par. o) , requiring written authorization is inapplicable to non-
union members, especially in this case where non-union employees receive several benefits under the
CBA.
EDGARDO MARINO JR. ET. AL. V. GAMILIA July 7, 2009

FACTS: Atty. Eduardo J. Mariño, Jr., Ma. Melvyn P. Alamis, Norma P. Collantes, and Fernando Pedrosa
were among the executive officers and directors (collectively called the Mariño Group) of the University
of Sto. Tomas Faculty Union (USTFU), a labor union duly organized and registered under the laws of the
Republic of the Philippines and the bargaining representative of the faculty members of the University
of Santo Tomas (UST).
4CEF 2021-2022 8
USTFU, through its President, petitioner Atty. Mariño requested the release to the union of the sum of
P4.2 million, which was 10% of the P42 million economic benefits package granted by the MOA to
faculty members belonging to the collective bargaining unit. Petitioners claimed that the P4.2 million
shall be for the payment of attorney’s fees.
ISSUE: Whether or not the amount of P42 million should not answer for any attorney’s fees. – YES
HELD: YES. The Court finds that, in the instant case, the P42 million economic benefits package granted
by UST did not constitute union funds from whence the P4.2 million could have been validly deducted
as attorney's fees. The P42 million economic benefits package was not intended for the USTFU coffers,
but for all the members of the bargaining unit USTFU represented, whether members or nonmembers
of the union.
What the law requires is that the funds be already deemed union funds even before the attorney's fees
are deducted or paid therefrom; it does not become union funds after the deduction or payment.
Requisites for valid levy or check-of: (1) an authorization by a written resolution of the majority of all
the union members at the general membership meeting duly called for the purpose; (2) secretary's
record of the minutes of the meeting; and (3) individual written authorization for check-off duly signed
by the employee concerned.
However, there was no way for any individual union member to separate his or her consent to the
ratification of the MOA from his or her authorization of the check-off of union dues and special
assessments. As it were, the ratification of the MOA carried with it the automatic authorization of the
check-off of union dues and special assessments in favor of the union. Such a situation militated against
the legitimacy of the authorization for the P4.2 million check-off by a majority of USTFU membership.
Although the law does not prescribe a particular form for the written authorization for the levy or
check-off of special assessments, the authorization must, at the very least, embody the genuine consent
of the union member.
ERGONOMIC SYSTEMS PHIL INC. V. ENAJE December 13, 2017

FACTS: Respondent workers were members of the local union, Ergonomic System Employees Union-
Workers Alliance Trade Unions. The local union was registered before the DOLE. It had a CBA with
Ergonomics Systems Philippines (ESPI). It was also affiliated with a federation, Worker’s Alliance Trade
Union (WATU). The WATU found the respondents guilty of disloyalty to the federation and
recommended their termination to ESPI by virtue of union security clause provision in CBA.
ISSUE: W/N workers may be terminated through the union security clause. – NO
Held: Before an employer terminates an employee pursuant to the union security clause, it needs to
determine and prove that: (1) the union security clause is applicable; (2) the union is requesting the
enforcement of the union security provision in the CBA; and (3) there is sufficient evidence to support
the decision of the union to expel the employee from the union.
In this case, the one invoking the clause is not the union but the federation. The CBA is a contract
between the union (local) and the employer, and the federation is not a party to the CBA. Besides, a
chartered local union acquires legal personality through the charter certificate issued by a duly
registered federation or national union and reported to the Regional Office. "A local union does not
owe its existence to the federation with which it is affiliated.
ART. 251 [242]. RIGHTS OF LEGITIMATE LABOR ORGANIZATIONS
4CEF 2021-2022 9
HERITAGE HOTEL MANILA V. NUWHRAIN-HHMSC January 12, 2011
FACTS: The DOLE granted respondent union’s Petition for Certification Election.
Later, the petitioner filed a Petition for Cancellation of Registration of the respondent union on the
ground of non-submission of annual financial reports of the union. Nonetheless, the certification
election was held.
The petitioner said that the election was futile because once its registration is cancelled, it would no
longer be entitled to be certified as the SEBA.
The union was then certified as the SEBA of supervisory employees.
The petition for cancellation was denied by the lower tribunals.
ISSUE: WON respondent union’s registration should be cancelled for failure to submit its financial
reports? – NO
HELD: The union members and, in fact, all the employees belonging to the appropriate bargaining unit
should not be deprived of a bargaining agent, merely because of the negligence of the union officers
who were responsible for the submission of the documents to the BLR.
In resolving the petition, consideration must be taken of the fundamental rights guaranteed by the
Constitution, i.e., the rights of all workers to self-organization, collective bargaining and negotiations,
and peaceful concerted activities.
It is undisputed that appellee failed to submit its annual financial reports and list of individual members
in accordance with Article 239 of the Labor Code. However, the existence of this ground should not
necessarily lead to the cancellation of union registration. Article 239 recognizes the regulatory
authority of the State to exact compliance with reporting requirements. Yet there is more at stake in
this case than merely monitoring union activities and requiring periodic documentation thereof. The
more substantive considerations involve the constitutionally guaranteed freedom of association and
right of workers to self-organization.
ABARIA V. NLRC December 7, 2011

FACTS: The National Federation of Labor (NFL) is the exclusive bargaining representative of the rank-
and-file employees of MCCHI. Under the 1987 and 1991 Collective Bargaining Agreements (CBAs), the
signatories were Ciriaco B. Pongasi, Sr. for MCCHI, and Atty. Armando M. Alforque (NFL Legal Counsel)
and Paterno A. Lumapguid as President of NFL-MCCH Chapter, while Perla Nava, President of
Nagkahiusang Mamumuo sa MCCH (NAMA-MCCH-NFL) signed the Proof of Posting.
Nava wrote Rev. Iyoy expressing the union’s desire to renew the CBA, attaching to her letter a
statement of proposals signed/endorsed by 153 union members. Nava subsequently requested that
the following employees be allowed to avail of one-day union leave with pay.
Meanwhile, Atty. Alforque informed MCCHI that the proposed CBA submitted by Nava was never
referred to NFL and that NFL has not authorized any other legal counsel or any person for collective
bargaining negotiations.
As the situation worsened, union members led by Nava and her group launched a series of mass actions
such as wearing black and red armbands/headbands, marching around the hospital premises and
putting up placards, posters and streamers.
ISSUE: WoN petitioner NAMA-MCCH-NFL actions are within the bounds of the law. – NO
4CEF 2021-2022 10
HELD: Records of the NCMB and DOLE Region 7 confirmed that NAMA-MCCH-NFL had not registered
as a labor organization, having submitted only its charter certificate as an affiliate or local chapter of
NFL. Not being a legitimate labor organization, NAMA-MCCH-NFL is not entitled to those rights granted
to a legitimate labor organization under Art. 242, specifically:
(a) To act as the representative of its members for the purpose of collective bargaining;
(b) To be certified as the exclusive representative of all the employees in an appropriate collective
bargaining unit for purposes of collective bargaining.
Not being a legitimate labor organization nor the certified exclusive bargaining representative of
MCCHI’s rank-and-file employees, NAMA-MCCH-NFL cannot demand from MCCHI the right to bargain
collectively on their behalf. Hence, MCCHI’s refusal to bargain then with NAMA-MCCH-NFL cannot be
considered an unfair labor practice to justify the staging of the strike.
PENINSULA EMPLOYEES UNION V. ESQUIVEL December 1, 2016

FACTS: In December 2007, the Peninsula Employees’ Union (PEU) Board of Directors passed a
resolution authorizing the affiliation of PEU with National Union of Workers in Hotel Restaurants and
Allied Industries (NUWHRAIN) and the direct membership of its individual members thereto. On the
same day, the act was submitted to the general membership and was duly ratified.
Beginning January 2009, PEU-NUWHRAIN sought to increase the agency fee from 1% to 2% of the rank-
and-file employees’ monthly salaries, the reason being that NUWHRAIN supposedly requires its
affiliates to remit 2% of their monthly salaries to it. The non-PEU members objected to the increase of
agency fees, arguing inter alia that the 2% agency fee is exorbitant and unreasonable.
ISSUE: WON the agency fee is exorbitant and unreasonable — YES.
HELD: YES. PEU-NUWHRAIN failed to show compliance with the requirements to justify a valid increase
of union dues. While PEU-NUWHRAIN did conduct a general membership meeting, there was no
sufficient showing that the matter of increasing the union dues was duly deliberated and approved.
Having failed to establish due deliberation and approval of the increase in union dues, there is no legal
basis to impose union dues and agency fees more than that allowed in the original CBA, which is 1% of
the employees’ basic monthly salary.
Requirements for valid increase of union dues:
(a) authorization by a written resolution of the majority of all the members at the general membership
meeting duly called for the purpose;
(b) the secretary’s record of the minutes of the meeting, which includes the votes cast, the purpose of
the special assessment or fees, and the recipient of such assessment or fees
(c) individual written authorizations for check-off duly signed by the employees concerned.
(Note: Under Article 251 ito sa syllabus pero dapat under Article 250 siya.)
ERGONOMIC SYSTEMS V. ENAJE December 13, 2017 (affiliation and disaffiliation)

FACTS: Respondents were union officers and members of Ergonomic System Employees Union (local
union). It then entered into a CBA with petitioner Ergonomic Systems, which was valid for five (5) years
or until October 2004.
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The local union, which was affiliated with Workers Alliance Trade Unions-Trade Union Congress of the
Philippines (Federation), was not independently registered.
Thus, in 2001, before the CBA expired, the union officers secured the independent registration of the
local union with the Regional Office of DOLE Later on, the union officers were charged before the
Federation and investigated for attending and participating in other union's seminars and activities
using union leaves without the knowledge and consent of the Federation and ESPI as well as in initiating
and conspiring in the disaffiliation before the freedom period.
The Federation rendered a decision finding respondents-union officers guilty of disloyalty.
Thereafter, they were sent letters of termination, which they again refused to receive. ESPI then
submitted to the DOLE a list of the dismissed employees. On the same day, the local union filed a notice
of strike with the NCMB
Respondents then filed a complaint for illegal dismissal and unfair labor practice against petitioners
ISSUE: Whether the federation may invoke the union security clause in demanding the respondents'
dismissal.
HELD: No. Only the local union may invoke the union security clause in the CBA.
Federation could not demand the dismissal from employment of the union officers on the basis of the
union security clause found in the CBA between ESPI and the local union.
Before an employer terminates an employee pursuant to the union security clause, it needs to
determine and prove that: (a) the union security clause is applicable; (b) the union is requesting the
enforcement of the union security provision in the CBA, and (c) there is sufficient evidence to support
the decision of the union to expel the employee from the union.
In this case, the primordial requisite, Le.. the union is requesting the enforcement of the union security
provision in the CBA, is clearly lacking. Under the Labor Code, a chartered local union acquires legal
personality through the charter certificate issued by a duly registered federation or national union and
reported to the Regional Office.
NATURE OF CBA
WESLAYAN UNIVERSITY PHILS. V. WESLAYAN March 12, 2014
UNIVERSITY PHILIPPINES FACULTY AND STAFF
ASSOCIATION
FACTS: Wesleyan University-PH, and the Wesleyan University Faculty and Staff Association signed a
5-year CBA effective 2003 until 2008.
In 2005, Wesleyan through Atty. Maglaya, issued a memorandum providing for guidelines on the
implementation of vacation and sick leave credits as well as vacation leave commutation. The
Memorandum states that vacation and sick leave credits are not automatic as leave credits would be
earned on a month-to month basis.
CBA: Sections 1 and 2 of Article XII of the CBA provide that all covered employees are entitled to 15
days sick leave and 15 days vacation leave with pay every year and that after the second year of service,
all unused vacation leave shall be converted to cash and paid to the employee at the end of each school
year, not later than August 30 of each year.
ISSUE: Whether respondent can unilaterally make changes in the CBA? NO.
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HELD: NO. A Collective Bargaining Agreement (CBA) is a contract entered into by an employer and a
legitimate labor organization concerning the terms and conditions of employment. Like any other
contract, it has the force of law between the parties and, thus, should be complied with in good faith.
Unilateral changes or suspensions in the implementation of the provisions of the CBA, therefore, cannot
be allowed without the consent of both parties.
Here, the changes limit the available leave credits of an employee at the start of the school year. Hence,
it must be struck down. When the provision of the CBA is clear, leaving no doubt on the intention of
the parties, the literal meaning of the stipulation shall govern. However, if there is doubt in its
interpretation, it should be resolved in favor of labor, as this is mandated by no less than the
Constitution.
ART. 253 [243]. COVERAGE AND EMPLOYEES’ RIGHT TO SELF-ORGANIZATION

SAMAHAN NG MANGAGAWA SA HANJIN October 14, 2015
SHIPYARD V. BLR
FACTS: Respondent Hanjin Heavy Industries and Construction Co., Ltd. Philippines filed a petition with
DOLE-Pampanga praying for the cancellation of registration of Samahan's association on the ground
that its members did not fall under any of the types of workers enumerated in the second sentence of
Article 243 (now 253).
Hanjin opined that only ambulant, intermittent, itinerant, rural workers, self-employed, and those
without definite employers may form a workers' association. It further posited that one third (1/3) of
the members of the association had definite employers and the continued existence and registration
of the association would prejudice the company's goodwill.
ISSUE: Whether the employees herein have the right to organization in contemplation of Article 253 of
the Labor Code.
HELD: Yes. The law clearly afforded the right to self-organization to all workers including those without
definite employers. As an expression of the right to self-organization, industrial, commercial and self-
employed workers could form a workers' association if they so desired but subject to the limitation that
it was only for mutual aid and protection. Nowhere could it be found that to form a workers' association
was prohibited or that the exercise of a workers' right to self-organization was limited to collective
bargaining.
UNITED PEPSI COLA SUPERVISORY UNION V. March 25, 1998

LAGUESMA
FACTS: Petitioner is a union of supervisory employees who filed a petition for certification election on
behalf of the route managers at Pepsi-Cola Products Philippines, Inc. Its petition was denied by both
the Med-Arbiter and SOLE (on appeal) on the ground that the route managers are managerial
employees and, therefore, ineligible for union membership.
Petitioner challenged the validity of the order. Its main contention was that the first sentence of Art.
245 of the Labor Code, so far as it declares managerial employees to be ineligible to form, assist or join
unions contravenes the Constitution
ISSUE: WON the route managers are considered managerial employees.
(Also discussed herein the rationale behind the prohibition on unionism imposed upon managerial EEs)
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HELD: Yes, they are managerial employees based on their job description. Unlike supervisors who
basically merely direct operating employees in line with set tasks assigned to them, route managers are
responsible for the success of the company's main line of business through management of their
respective sales teams. Such management necessarily involves the planning, direction, operation and
evaluation of their individual teams and areas which the work of supervisors does not entail.
While route managers do not appear to have the power to hire and fire people (the evidence shows
that they only "recommended" or "endorsed" the taking of disciplinary action against certain
employees), this is because this is a function of the Human Resources or Personnel Department of the
company.
Constitutionality of the prohibition on managerial employees to form, assist or join unions: Yes. There
is a rational basis for such prohibition. By the very nature of their functions, they assist and act in a
confidential capacity to, or have access to confidential matters of, persons who exercise managerial
functions in the field of labor relations. If these managerial employees would belong to or be affiliated
with a Union, the latter might not be assured of their loyalty to the Union in view of evident conflict of
interests. The Union can also become company-dominated with the presence of managerial employees
in Union membership.
METROLAB INDUSTRIES V. CONFESOR February 28, 1996

FACTS: ON MANAGEMENT PREROGATIVE
The CBA between Metrolab and the Union expired. The negotiations for a new CBA ended in a deadlock.
Consequently, the Union filed a notice of strike. Then Labor Secretary Torres issued an order resolving
all the disputed items in the CBA. Thereafter, the Union filed an MR. During its pendency thereof,
Metrolab laid off 94 of its rank and file employees. The Union filed a motion for a cease and desist
order. On the other hand, Metrolab contended that the layoff was temporary and in the exercise of
its management prerogative. Acting Labor Secretary Nieves Confesor declared the layoff illegal and
ordered their reinstatement with full backwages. The parties entered into a new CBA.
ON CONFIDENTIAL EMPLOYEES’ INELIGIBILITY TO JOIN UNIONS
Metrolab laid off 73 of its employees on grounds of redundancy which the Union again promptly
opposed. Labor Secretary Confesor again issued a cease and desist order and the assailed Omnibus
Resolution denying Metrolab’s MR. Metrolab, however, maintains that executive secretaries, who are
all members of the company's Management Committee should be excluded from membership in the
bargaining unit of the rank and file employees as well on grounds that their executive secretaries are
confidential employees, having access to "vital labor information."
ISSUE: W/N executive secretaries are excluded from the bargaining unit – YES
HELD: ON MANAGEMENT PREROGATIVE
This Court recognizes the exercise of management prerogatives and often declines to interfere.
However, this privilege is not absolute. The case at bench constitutes one of the exceptions. The
Secretary of Labor is expressly given the power under the Labor Code to assume jurisdiction and
resolve labor disputes involving industries indispensable to national interest. That Metrolab's
business is of national interest is not disputed. Metrolab is one of the leading manufacturers and
suppliers of medical and pharmaceutical products to the country. Metrolab's management
prerogatives, therefore, are not being unjustly curtailed.
ON CONFIDENTIAL EMPLOYEES’ INELIGIBILITY TO JOIN UNIONS
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Although Article 245 of the Labor Code limits the ineligibility to join, form and assist any labor
organization to managerial employees, jurisprudence has extended this prohibition to confidential
employees. Forming part of the bargaining unit, the executive secretaries stand to benefit from any
agreement executed between the Union and Metrolab. Such a scenario, thus, gives rise to a potential
conflict between personal interests and their duty as confidential employees to act for and in behalf of
Metrolab. Confidential employees cannot be classified as rank and file. Excluding confidential
employees from the rank and file bargaining unit, therefore, is not tantamount to discrimination.
SAN MIGUEL FOODS V. SAN MIGUEL August 1, 2011

CORPORATION SUPERVISORS AND EXEMPT UNION
FACTS: In the case of San Miguel Corporation Supervisors and Exempt Union v. Laguesma, the Court
held that even if they handle confidential data regarding technical and internal business operations,
supervisory employees 3 and 4 and the exempt employees of petitioner San Miguel Foods, Inc. are not
to be considered confidential employees, because the same do not pertain to labor relations,
particularly, negotiation and settlement of grievances. Consequently, they were allowed to form an
appropriate bargaining unit for the purpose of collective bargaining. The Court also declared that the
employees belonging to the three different plants of San Miguel Corporation Magnolia Poultry Products
Plants in Cabuyao, San Fernando, and Otis, having community or mutuality of interests, constitute a
single bargaining unit.
A certification election was conducted. On the date of the election, petitioner filed the Omnibus
Objections and Challenge to Voters, questioning the eligibility to vote by some of its employees on the
grounds that some employees do not belong to the bargaining unit which respondent seeks to
represent or that there is no existence of employer-employee relationship with petitioner.
Based on the results of the election, the Med-Arbiter issued the Order stating that since the Yes vote
received 97% of the valid votes cast, respondent is certified to be the exclusive bargaining agent of the
supervisors and exempt employees of petitioner's Magnolia Poultry Products Plants in Cabuyao, San
Fernando, and Otis.
On appeal, the then Acting DOLE Undersecretary, in the Resolution, affirmed the Order of the Med-
Arbiter.
CA affirmed the Resolution of DOLE Undersecretary with modification stating that those holding the
positions of Human Resource Assistant and Personnel Assistant are excluded from the bargaining unit.
Hence, this petition by the San Miguel Foods
ISSUE: W/N CA departed from jurisprudence when it expanded the scope of the bargaining unit.
HELD: No. In San Miguel vs Laguesma, the Court explained that the employees of San Miguel
Corporation Magnolia Poultry Products Plants of Cabuyao, San Fernando, and Otis constitute a single
bargaining unit, which is not contrary to the one-company, one-union policy. An appropriate bargaining
unit is defined as a group of employees of a given employer, comprised of all or less than all of the
entire body of employees, which the collective interest of all the employees, consistent with equity to
the employer, indicate to be best suited to serve the reciprocal rights and duties of the parties under
the collective bargaining provisions of the law.
It held that while the existence of a bargaining history is a factor that may be reckoned with in
determining the appropriate bargaining unit, the same is not decisive or conclusive. Other factors must
be considered. The test of grouping is community or mutuality of interest. This is so because the basic
test of an asserted bargaining unit’s acceptability is whether or not it is fundamentally the combination
4CEF 2021-2022 15
which will best assure to all employees the exercise of their collective bargaining rights. Certainly, there
is a mutuality of interest among the employees. Their functions mesh with one another. One group
needs the other in the same way that the company needs them both. There may be differences as to
the nature of their individual assignments, but the distinctions are not enough to warrant the formation
of a separate bargaining unit.
The Court affirms the finding of the CA that there should be only one bargaining unit for the employees
in Cabuyao, San Fernando, and Otis of Magnolia Poultry Products Plant involved in dressed chicken
processing and Magnolia Poultry Farms engaged in live chicken operations. Certain factors, such as
specific line of work, working conditions, location of work, mode of compensation, and other relevant
conditions do not affect or impede their commonality of interest. Although they seem separate and
distinct from each other, the specific tasks of each division are actually interrelated and there exists
mutuality of interests which warrants the formation of a single bargaining unit.
ART. 255 [245]. INELIGIBILITY OF MANAGERIAL EMPLOYEES TO JOIN ANY LABOR ORGANIZATION; RIGHT OF
SUPERVISORY EMPLOYEES
SMCC V. CHARTER CHEMICAL AND COATING CORP. March 16, 2011
FACTS: On February 10, 1999, Samahang Manggagawa sa Charter Chemical Solidarity of Unions in the
Philippines for Empowerment and Reforms (SMCC) filed a petition for certification election among the
regular rank-and-file employees of Charter Chemical with the Mediation Arbitration Unit of the DOLE,
NCR. On April 14, 1999, Charter Chemical contested the petition on the ground that SMCC is not a
legitimate labor organization because of, among others, the inclusion of supervisory employees within
SMCC.
ISSUE: WON the inclusion of the supervisory employees in SMCC divests SMCC of its status as a
legitimate labor organization and if yes, WON the petition for certification election should be dismissed.
HELD: NO as to both. The inclusion of the supervisory employees in SMCC does not divest it of its status
as a legitimate labor organization because RA No. 6715 omitted the exact effect of any violation of the
prohibition on co-mingling of supervisory and rank-and-file employees would bring about on the
legitimacy of a labor organization. It is also not a ground for the cancellation of SMCC’s registration,
unless such mingling was brought about by misrepresentation, false statement or fraud under Art. 239
[now Art. 247] of the Labor Code. As a result, SMCC had the right to file the subject petition for
certification since it was not divested of its status as a legitimate labor organization.
CATHAY PACIFIC STEEL CORP. V. CA August 30, 2003

FACTS: Supervisory personnel of CAPASCO organized a union among their ranks, later known as the
private respondent CUSE. Tamandong, a Personnel Superintendent and is considered by the company
as managerial employee, actively involved himself in the organization of the union and was elected as
one of its officers. CAPASCP sent a memo to Tamandong to discontinue from union activities.
Tamandong invoked his right as a supervisory employee to join and organize a labor union. CAPASCO
terminated his employment on the ground of loss of trust and confidence, citing his union activities as
acts constituting serious disloyalty to the company.
ISSUE: WON Tamandong is not a managerial employee but a supervisory employee who is eligible to
participate in union activities. – YES
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HELD: Yes. Tamandong is a supervisory employee, thus, eligible to join or participate in union activities
of CUSE.
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; whereas managerial employees are those who are vested
with powers or prerogatives to lay down and execute management policies and/or hire, transfer,
suspend, lay off, recall, discharge, assign or discipline employees.
AIM V. AIM FACULTY ASSOCIATION January 23, 2017

FACTS: On May 16, 2007, respondent filed a petition for certification election seeking to represent a
bargaining unit in AIM consisting of forty faculty members. Petitioner opposed the petition, claiming
that respondent's members are neither rank-and-file nor supervisory, but rather, managerial
employees. On July 11, 2007, petitioner filed a petition for cancellation of respondent's certificate of
registration on the grounds of misrepresentation in registration and that respondent is composed of
managerial employees who are prohibited from organizing as a union.
ISSUE: Whether or not the petition for cancellation is the proper remedy in this case. – YES
HELD: The SC found the filing proper. In ruling this case, the SC cited the case of Holy Child Catholic
School v. Hon. Sto, Tomas in holding that “In case of alleged inclusion of disqualified employees in a
union, the proper procedure for an employer like AIM is to directly file a petition for cancellation of the
union’s certificate of registration due to misrepresentation, false statement or fraud under the
circumstances enumerated in Article 239 of the Labor Code, as amended.” On the basis of the ruling in
the above-cited case, it can be said that AIM was correct in filing a petition for cancellation of AFA’s
certificate of registration. AIM sole ground for seeking cancellation of AFA’s certificate of registration-
that its members are managerial employees and for this reason, its registration thus a patent nullity for
being an absolute violation of Article 245 of the Labor code which declares that managerial employees
are ineligible to join any labor organization-is, in a sense, an accusation that AFA is guilty of
misrepresentation for registering under the claim that its members are not managerial employees.
However, the issue of whether AFA’s members are managerial employees is still pending resolution by
way of petition for review on certiorari in G.R. No. 197089.
ART. 256 [245-A]. EFFECT OF INCLUSION AS MEMBERS OF EMPLOYEES OUTSIDE THE BARGAINING UNIT
HOLY CHILD CATHOLIC SCHOOL V. STO. TOMAS July 23, 2013
FACTS: A petition for certification election was filed by HCCS-TELU-PIGLAS. HCCS has 156 employees,
consisting of teaching, non-teaching academic and non-teaching non-academic workers. HCCS averred
that of the employees that signed, 14 already resign and 6 signed twice and the members of HCCS-
TELU-PIGLAS do not belong to the same class, not only a mixture of managerial, supervisory and rank-
and-file, and a combination of teaching and non-teaching.
HCCS insisted that HCCS-TELU-PIGLAS for not being in accord with Art. 245(now 256) is an illegitimate
labor organization lacking in personality to file a petition for certification election and an inappropriate
bargaining unit for want of community or mutuality of interest.
ISSUE: Whether or not a petition for certification election is dismissible on the ground that the labor
organization is allegedly composed of supervisory and rank and file employees. – NO
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HELD: No. While there is prohibition against the mingling of supervisory and rank and file employees in
one labor organization, the Labor Code does not provide for the effects thereof. Thus, after a labor
organization has been registered, it may exercise all the rights and privileges of a legitimate labor
organization. Any mingling between supervisory and rank and file employees in its membership cannot
affect its legitimacy for that is not among the grounds for cancellation of registration, unless such
mingling was brought about by misrepresentation, false statement or fraud under Article 239 (now 247)
of the Labor Code.
Hence, petitioner cannot collaterally attack the legitimacy of private respondent by praying for the
dismissal of the petition for certificate election because except when it is requested to bargain
collectively, an employer is a mere bystander to any petition for certificate election. Such proceeding
is non-adversarial and is merely investigative, for the purpose thereof is to determine which
organization will represent the employees in their collective bargaining with the employer. The
employer’s only right in the proceeding is to be notified or informed thereof.
ARTS. 258-260 [247-249]. UNFAIR LABOR PRACTICES

T&H SHOPFITTERS CORPORATION V. T&H February 26, 2014
SHOPFITTERS UNION
FACTS: Respondents desired to improve their working conditions so they had a formal meeting to
discuss the formation of a union. . The following day 17 employees were barred from entering
petitioners’ factory premises in Zambales. The 17 were repeatedly ordered to go on forced leave.
DOLE eventually issued a certificate of registration in favor of the THGQ Union. The affected employees
were not given work, while subcontractors were hired to perform their functions.
When a certification election was finally scheduled, the president of Gin Queen through a
memorandum announced that it was relocating its office and workers, workers were suspended for
failure to show up for work, and petitioner also organized a field trip which excluded the workers. Due
to the heavy pressure exerted by petitioners, the votes for "no union" prevailed. After the elections,
union officers and members were retrenched. Gin Queen alleged that it is an entity separate from T&H,
and that the retrenchment was done as a cost-cutting measure. Respondents filed a Complaint for ULP
by way of union busting, and Illegal Lockout, and damages against petitioner.
LA ruled against union, NLRC reversed.
ISSUE: Whether unfair labor practice was committed by petitioners. - YES
HELD: YES, ULP - interference on the part of petitioners. Indubitably, the various acts of petitioners,
taken together, reasonably support an inference that, indeed, such were all orchestrated to restrict
respondents’ free exercise of their right to self- organization. The Court is of the considered view that
petitioners’ undisputed actions prior and immediately before the scheduled certification election, while
seemingly innocuous, unduly meddled in the affairs of its employees in selecting their exclusive
bargaining representative.
REN TRANSPORT V. NLRC June 27, 2016

FACTS: Samahan ng Manggagawa sa Ren Transport (SMART) is a registered union, which had a five-
year CBA with Ren Transport Corp. The 60-day freedom period of the CBA passed without a challenge
to SMART'S majority status as bargaining agent. SMART thereafter conveyed its willingness to bargain
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with Ren Transport, to which it sent bargaining proposals. Ren Transport, however, failed to reply to
the demand.
Subsequently, two members of SMART wrote to DOLE-NCR informing them that a majority of the
members of SMART had decided to disaffiliate from their mother federation to form another union,
Ren Transport Employees Association (RTEA). SMART contested the alleged disaffiliation through a
letter. During the pendency of the disaffiliation dispute, Ren Transport stopped the remittance to
SMART of the union dues that had been checked off from the salaries of union workers as provided
under the CBA. Further, Ren Transport voluntarily recognized RTEA as the sole and exclusive bargaining
agent of the rank-and-file employees of their company.
ISSUE: Whether or not Ren Transport committed acts of unfair labor practice. – YES
HELD: Firstly, violation of the duty to bargain collectively is an unfair labor practice under Article 258(g)
of the Labor Code. It is during the freedom period — or the last 60 days before the expiration of the
CBA — when another union may challenge the majority status of the bargaining agent through the filing
of a petition for a certification election. If there is no such petition filed during the freedom period, then
the employer "shall continue to recognize the majority status of the incumbent bargaining agent where
no petition for certification election is filed." In the present case, no petition for certification election
challenging the majority status of SMART was filed during the freedom period. SMART therefore
remained the exclusive bargaining agent of the rank-and-file employees.
Secondly, interference with the employees' right to self-organization is considered an unfair labor
practice under Article 258 (a) of the Labor Code. In this case, the labor arbiter found that the failure to
remit the union dues to SMART and the voluntary recognition of RTEA were clear indications of
interference with the employees' right to self-organization.
DIGITAL TELECOMMUNICATIONS PHILS. V. DIGITEL October 10, 2012

EMPLOYEES UNION
FACTS: Digitel Employees Union (Union) became the exclusive bargaining agent of all rank and file
employees of Digitel in 1994. The Union and Digitel then commenced collective bargaining negotiations
which resulted in a bargaining deadlock. The Union threatened to go on strike, but then Acting Labor
Secretary Laguesma assumed jurisdiction over the dispute and eventually directed the parties to
execute a CBA. However, no CBA was forged between Digitel and the Union. 10 years after, Digitel
received from Esplana, who identified himself as President of the Union, a letter containing the list of
officers, CBA proposals and ground rules. Digitel was reluctant to negotiate with the Union and
demanded that the latter show compliance with the provisions of the Union’s Constitution and By-laws
on union membership and election of officers. Esplana and his group filed a case for Preventive
Mediation before the NCMB based on Digitel’s violation of the duty to bargain. On 25 November 2004,
Esplana filed a notice of strike. Labor Secretary assumed jurisdiction over the labor dispute. During the
pendency of the controversy, Digitel Service, Inc. (Digiserv), a non-profit enterprise engaged in call
center servicing, filed with the DOLE an Establishment Termination Report stating that it will cease its
business operation. Alleging that 42 of the affected employees are its members and in reaction to
Digiserv’s action, Esplana and his group filed another Notice of Strike for union busting, illegal lock-out,
and violation of the assumption order.
ISSUE: Whether or not Digitel committed acts of ULP when it dismissed employees from its department
Digeserv. – YES
HELD: YES. There is no doubt that Digitel defied the assumption order by abruptly closing down
Digiserv. The closure of a department is not illegal per se. What makes it unlawful is when the closure
4CEF 2021-2022 19
is undertaken in bad faith. The assumption order directs employees to return to work, and the employer
to reinstate the employees. The existence of the assumption order should have prompted Digitel to
observe the status quo. Instead, Digitel proceeded to close down Digiserv. The Secretary of Labor had
to subsume the second notice of strike in the assumption order. This order notwithstanding, Digitel
proceeded to dismiss the employees. The timing of the creation of I-tech is dubious. It was incorporated
on 18 January 2005 while the labor dispute within Digitel was pending. I-tech’s primary purpose was to
provide call center/customer contact service, the same service provided by Digiserv. Thus, when
Digiserv was closed down, some of the employees, presumably non-union members, were rehired by
I-tech. Thus, the closure of Digiserv pending the existence of an assumption order coupled with the
creation of a new corporation performing similar functions as Digiserv leaves no iota of doubt that the
target of the closure are the union member-employees. These factual circumstances prove that Digitel
terminated the services of the affected employees to defeat their security of tenure. The termination
of service was not a valid retrenchment; it was an illegal dismissal of employees. It needs to be
mentioned too that the dismissal constitutes an unfair labor practice under Article 248(c) of the Labor
Code which refers to contracting out services or functions being performed by union members when
such will interfere with, restrain or coerce employees in the exercise of their rights to self- organization.
GENERAL SANTOS COCA-COLA PLANT FREE February 13, 2009

WORKERS UNION TUPAS V. COCA-COLA BOTTLERS,
PHILS. INC.
FACTS: Sometime in the late 1990s, CCBPI experienced a significant decline in profitability due to the
Asian economic crisis, decrease in sales, and tougher competition. To curb the negative effects on the
company, it implemented three (3) waves of an Early Retirement Program. Because several employees
availed of the early retirement program, vacancies were created in some departments, including the
production department of CCBPI Gen San, where members of petitioner Union worked. Faced with
the "freeze hiring" directive, CCBPI Gen San engaged the services of JLBP Services Corporation (JLBP),
a company in the business of providing labor and manpower services, including janitorial services,
messengers, and office workers to various private and government offices.
Petitioner filed with the NCMB a Notice of Strike on the ground of alleged ULP committed by CCBPI
Gen San for contracting-out services regularly performed by union members ("union busting").
However, the parties failed to come to an amicable settlement.
NLRC ruled CCBPI not guilty of ULP. CA affirmed. CA held that the contract between CCBPI and JLBP did
not amount to labor-only contracting. It found that JLBP was an independent contractor and that the
decision to contract out jobs was a valid exercise of management prerogative to meet exigent
circumstances.
ISSUE: Whether CCBPI's contracting-out of jobs to JLBP amounted to unfair labor practice. – NO
HELD: NO. The NLRC found - and the same was sustained by the CA - that the company's action to
contract-out the services and functions performed by Union members did not constitute unfair labor
practice as this was not directed at the members' right to self-organization.
*Court cited Art. 248 (c) now Art. 259 (c)
Unfair labor practice refers to "acts that violate the workers' right to organize." The prohibited acts
are related to the workers' right to self-organization and to the observance of a CBA. Without that
element, the acts, even if unfair, are not unfair labor practices.
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UST FACULTY UNION V. UST April 7, 2009
FACTS: UST Faculty Union (USTFU) wrote letter to all its members, informing them of General Assembly.
The then Pres of Union was Atty Marino. The letter contained agenda for GA which included election
of officers. There was also a convocation, to which all the members of faculties attended, including
USTFU, w/o the participation of UST administration. During the convocation, an election for the officers
of USTFU was conducted. Upon learning that the convocation was intended to be an election, members
of USTFU walked out. An election was conducted among those present. There were two groups claiming
to be USTFU: the Gamilla Group and Marino Group.
Marino Group filed complaint for ULP against UST Arbitration Branch, praying for the nullification of
election of Gamilla Group as officers. CBA was entered into by Gamilla and UST which superseded the
existing CBA entered into by UST and USTFU. Gamilla padlocked the office of USTFU.
ISSUE: won UST guilty of ULP despite the abundance of evidence showing the ULP were indeed
committed? – NO
HELD: Petitioners contend that respondents violated par. a and d of Art. 259. The GR is that one who
makes an allegation has the burden of proving it. While there are exceptions to this rule, the alleging
party still has the burden of proving such ULP. Such principle finds justification in the fact that ULP is
punishable with both civil and/or criminal sanctions. To prove ULP, substantial evidence is required. IN
no way can the contents of the memorandum be interpreted to mean that faculty members were
required to attend the convocation. Not one coercive term was used in the memo to show that the
faculty club members were compelled to attend such.
As to the padlocking of USTFU office, it must be emphasized that Sibug was merely present with the
brgy capt. Sibug also padlocked the office but he neither harassed nor coerced anyone. Clearly, his mere
presence cannot be equated to a positive act of “aiding” the Gamilla group in securing the USTFU office.
Petitioner failed to present substantial evidence
PHIL. SKYLANDERS INC. V. NLRC January 31, 2002

FACTS: Philippine Skylanders Employees Association (PSEA), a local labor union affiliated with the
Philippine Association of Free Labor Unions (PAFLU) September (PAFLU), won in the certification
election conducted among the rank and file employees of Philippine Skylanders, Inc. (PSI). Its rival
union, Philippine Skylanders Employees Association-WATU (PSEA-WATU) immediately protested the
result of the election before the Secretary of Labor. Several months later, pending settlement of the
controversy, PSEA sent PAFLU a notice of disaffiliation citing as reason PAFLU's supposed deliberate
and habitual dereliction of duty toward its members. Several months later, pending settlement of the
controversy, PSEA sent PAFLU a notice of disaffiliation citing as reason PAFLU's supposed deliberate
and habitual dereliction of duty toward its members.
Agitated by PSI's recognition of PSEA-NCW, PAFLU through Serafin Ayroso filed a complaint for unfair
labor practice against PSI, its president Mariles Romulo and personnel manager Francisco Dakila. PAFLU
amended its complaint by including the elected officers of PSEA_PAFLU as additional party
respondents.
ISSUE: W/N PSEA, an independent and separate local union, validly disaffiliate from PAFLU. – YES
HELD: The right of local unions to separate from their mother federation on the ground that as separate
and voluntary associations, local unions do not owe their creation and existence to the national
federation to which they are affiliated but, instead, to the will of their members.
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The sole essence of affiliation is to increase, by collective action, the common bargaining power of local
unions.
for the effective enhancement and protection of their interests. Admittedly, there are times when
without succor and support local unions may find it hard, unaided by other support groups, to secure
justice for themselves.
There is nothing shown in the records nor is it claimed by PAFLU that the local union was expressly
forbidden to disaffiliate from the federation nor were there any conditions imposed for a valid
breakaway.
TROPICAL HUT EMPLOYEE’S UNION V. TROPICAL January 20, 1990

HUNT FOOT MARKET INC.
FACTS: The rank and file workers of Tropical Hut organized a union named Tropical Hut Employees
Union (THEU). It became affiliated with National Trade Union (NATU). NATU is not a registered
Federation. A CBA was entered between THEU-NATU and Tropical Hut. It contained union security
clause and check off provisions. Later, THEU decided to disaffiliate from NATU and join another
federation, CGW. It had an election and elected Jose Encinas as President. NATU seeked the termination
of Encinas in view of the union security clause. Encinas was dismissed within 48 hours by Tropical Hut.
ISSUE:
W/N a local union may disaffiliate from a federation. – YES
W/N the dismissal of the employees in view of the union’s disaffiliation constitutes ULP on the part of
Tropical Hut and NATU.
HELD: All employees enjoy the right to self organization and to form and join labor organizations of
their own choosing for the purpose of collective bargaining and to engage in concerted activities for
their mutual aid or protection. This is a fundamental right of labor that derives its existence from the
Constitution. In interpreting the protection to labor and social justice provisions of the Constitution and
the labor laws or rules or regulations.
There is nothing in the constitution and by laws of NATU prohibiting such disaffiliation. The alleged non-
compliance of the local union with the provision in the NATU Constitution requiring the service of three
months notice of intention to withdraw did not produce the effect of nullifying the disaffiliation for the
following grounds: firstly, NATU was not even a legitimate labor organization, it appearing that it was
not registered at that time with the Department of Labor, and therefore did not possess and acquire,
in the first place, the legal personality to enforce its constitution and laws, much less the right and
privilege under the Labor Code to organize and affiliate chapters or locals within its group, and secondly,
the act of non-compliance with the procedure on withdrawal is premised on purely technical grounds
which cannot rise above the fundamental right of self-organization.
As to the alleged violation of CBA, NATU cannot invoke the union security clause because THEU is the
exclusive bargaining representatives of the rank and file employees of Tropical Hut, not NATU.
As to the ULP.
The employees were dismissed hastily. An employer can be adjudged guilty of unfair labor practice for
having dismissed its employees in line with a closed shop provision if they were not given a proper
hearing.
In view of the fact that the dispute revolved around the mother federation and its local, with the
company suspending and dismissing the workers at the instance of the mother federation then, the
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company's liability should be limited to the immediate reinstatement of the workers. And since their
dismissals were effected without previous hearing and at the instance of NATU, this federation should
be held liable to the petitioners for the payment of their backwages, as what We have ruled in the
Liberty Cotton Mills Case
PUREFOODS CORP. V. NAGKAKAISANG August 28, 2008

SAMAHANG MANGAGAWA NG PUREFOODS RANK
AND FILE
FACTS: NAGSAMA-Purefoods (Luzon), STFWU (Sto. Tomas, Batangas), and PGFWU (Laguna) are
exclusive bargaining agents of R&F employees of Purefoods. The 3 organizations were affiliates of the
PULO federation.
There was a deadlock although such deadlock issue was later on settled but the matter of the
company’s recognition of the union’s affiliation with PULO was not settled. Purefoods refused to
negotiate with the unions should a PULO representative be in the panel. Later on, Purefoods concluded
a new CBA with another union in its farm in Malvar, Batangas and resulted in the termination of
employment of the R&F employees in Sto. Tomas.
ISSUE: WON Purefoods is liable for ULP for not recognizing PULO? – Yes.
HELD: It is crystal clear that the closure of the Sto. Tomas farm was made in bad faith. Badges of bad
faith are evident from the following acts of the petitioner: it unjustifiably refused to recognize the
STFWU's and the other unions' affiliation with PULO. It concluded a new CBA with another union in
another farm during the agreed indefinite suspension of the collective bargaining negotiations; it
surreptitiously transferred and continued its business in a less hostile environment; and it suddenly
terminated the STFWU members but retained and brought the non-members to the Malvar farm.
Petitioner presented no evidence to support the contention that it was incurring losses or that the
subject farm's lease agreement was preterminated. Ineluctably, the closure of the Sto. Tomas farm
circumvented the labor organization's right to collective bargaining and violated the members' right to
security of tenure
DE LA SALLE UNIVERSITY V. DLSUEA-NAFTEU April 7, 2009

FACTS: A splinter group of respondent led by one Belen Aliazas (Aliazas group) filed a petition for
conduct of elections with the Department of Labor and Employment (DOLE), alleging that the then
incumbent officers of respondent had failed to call for a regular election.
Disputing the Aliazas group’s allegation, respondent claimed that an election was conducted in 1987
but by virtue of the enactment of Republic Act 6715, which amended the Labor Code, the term of office
of its officers was extended to five years or until 1992 during which a general assembly was held
affirming their hold-over tenure until the termination of collective bargaining negotiations; and that a
collective bargaining agreement (CBA) was executed only on March 30, 2000.
Acting on the petition for the conduct of election filed by the Aliazas group, the DOLE-NCR held, that
the holdover authority of respondent’s incumbent set of officers had been extinguished by virtue of
the execution of the CBA.
Meanwhile, the petitioner ordered that until the result of this election comes out and a declaration by
the DOLE of the validly elected officers is made, a void in the Union leadership exists. And that union
4CEF 2021-2022 23
dues and fees shall be held in trust and discontinue normal relations with any group within the Union
including the incumbent set of officers.
ISSUE: WoN the petitioner has committed ULP. – YES
HELD: We take this opportunity to clarify that there is no void in the DLSUEA leadership. The 19 March
2001 Decision of DOLE-NCR Regional Director should not be construed as an automatic termination of
the incumbent officers’ tenure of office. As duly-elected officers of the DLSUEA, their leadership is not
deemed terminated by the expiration of their terms of office, for they shall continue their functions
and enjoy the rights and privileges pertaining to their respective positions in a hold-over capacity, until
their successors shall have been elected and qualified.
It bears noting that at the time petitioners’ questioned moves were adopted, a valid and existing CBA
had been entered between the parties. It thus behooved petitioners to observe the terms and
conditions thereof bearing on union dues and representation. It is axiomatic in labor relations that a
CBA entered into by a legitimate labor organization and an employer becomes the law between the
parties, compliance with which is mandated by express policy of the law.
In so far as the petition involves the merits of the NLRC Second Division Decision is concerned, the same
is REVERSED and a NEW one is entered finding petitioners liable for Unfair Labor Practice, and ordering
them to pay respondent nominal damages.
MSMG-UWP V. RAMOS February 28, 2000

FACTS: Petitioner MSMG was affiliated with ULGWP (the federation). When the federation disapproved
MSMG’s resolution to impose a P50.00 fine on its members who failed to attend a general membership
meeting, it became the subject of bitter disagreement between the two, which eventually led to
MSMG’s declaration of autonomy from the federation. Later on, the federation issued a resolution
placing MSMG under trusteeship. The administrator of the trusteeship designated a new local union
president and “disauthorized” the incumbent union officers from representing the employees.
MSMG protested this “disauthorization,” which impelled the federation to advise the respondent
company to expel the 30 union officers and demand their separation from employment pursuant to
the union security clause in their CBA.
Under pressure of a threatened strike, respondent company did as the federation advised, after which
the federation immediately withdrew its notice of strike. However, this provoked members of MSMG
into staging a walk-out and eventually a strike. The strike was attended with violence, force and
intimidation on both sides.
The LA ruled inter alia that the strike was illegal for the followings reasons:
(1) it was based on an intra-union dispute, which is not a valid basis for a strike since the right to strike
is limited only to cases of bargaining deadlock and ULP;
(2) it was made in violation of the “no strike, no lockout” clause in the CBA; and
(3) it was attended with violences, force and intimidation, resulting in serious physical injuries to other
employees and damage to company property.
ISSUE: WON the strike was illegal. — NO.
HELD: As to the LA’s first argument, it must be reiterated that when the respondent company dismissed
the union officers, the issue was transformed from an intra-union dispute into a termination dispute.
Petitioners believed in good faith that when the respondent company dismissed them upon the request
4CEF 2021-2022 24
of the federation, it became guilty of ULP in that it violated their right to self-organization. Even if the
allegations of ULP are later found out to be false, the presumption of legality of strike prevails.
As to the LA’s second argument, a “no strike, no lockout” provision can only be invoked when the strike
is economic in nature. It cannot be invoked to assail the legality of a strike which is grounded on ULP,
as was the honest belief of the petitioners. Whether or not there was indeed ULP does not affect the
strike.
As to the LA’s third argument, the evidence on record showed that the violence cannot be attributed
to the striking employees only, because the company itself hired men to pacify the strikers. Since
violence was committed by both sides, such violence cannot be a ground for declaring the strike illegal.
ALABANG COUNTRY CLUB V. NLRC February 14, 2008

FACTS: Union and Club entered into a CBA containing a Union Shop and Maintenance of Membership
Shop provision. Respondents here, who were former Union officers, were found guilty of malversation
of public funds which caused their expulsion from the Union. Union requested Club to terminate the
Respondents pursuant to the Union Shop and Maintenance of Membership Shop provisions of the CBA.
Club conducted investigation and found that Union had cause to expel Respondents, thus Club was
compelled to terminate the Respondents pursuant to the CBA.
ISSUE: WON they are illegally dismissed and whether they were afforded due process. – NO
HELD: They are not illegally dismissed.
SC held that there was valid cause for termination because Union Shop and Maintenance of
Membership Provisions have been recognized by jurisprudence as valid causes of termination.
Another cause for termination is dismissal from employment due to the enforcement of the union
security clause in the CBA
Art II of the CBA: the Union members must maintain their membership in good standing as a condition
sine qua non for their continued employment with the Club is unequivocal. It is also clear that upon
demand by the Union and after due process, the Club shall terminate the employment of a regular R&F
employee who may be found able for a number of offenses one of which is malversation of Union funds
They were expelled after due investigation for acts of dishonesty and malversation of Union funds. In
accordance with the CBA, the Union property requested the Club to enlarge the Union security
provision in their CBA and terminate said respondents. Then, in compliance with the Union's request,
the Club reviewed the documents submitted by the Union, requested said respondents to submit
written explanations, and thereafter afforded them reasonable opportunity.
STANDARD CHARTERED BANK EMPLOYEES UNION June 16, 2004

V. CONFESOR
FACTS: The Bank and the Union signed a 5-year collective bargaining agreement (CBA) with a provision
to renegotiate the terms thereof on the third year. Prior to the commencement of the negotiation,
Diokno (Bank’s HR Manager) approached the Union’s President Divinagracia and suggested the
exclusion of Jose P. Umali, Jr. President of the National Union of Bank Employees (NUBE), the
federation to which the Union was affiliated, from the Union’s negotiating panel. Diokno suggested
that the negotiation be kept a “family affair.”
4CEF 2021-2022 25
ISSUE: Whether the Bank committed unfair labor practice when it suggested to exclude Umali from the
negotiating panel? – NO.
HELD: NO. If an employer interferes in the selection of its negotiators or coerces the Union to exclude
from its panel of negotiators a representative of the Union, and if it can be inferred that the employer
adopted the said act to yield adverse effects on the free exercise to right to self-organization or on the
right to collective bargaining of the employees, ULP under Article 248(a) in connection with Article 243
of the Labor Code is committed.
In order to show that the employer committed ULP under the Labor Code, substantial evidence is
required to support such claim. Substantial evidence has been defined as such relevant evidence as a
reasonable mind might accept as adequate to support a conclusion.
Here, the circumstances that occurred during the negotiation do not show that the suggestion made
by Diokno to Divinagracia is an anti-union conduct from which it can be inferred that the Bank
consciously adopted such act to yield adverse effects on the free exercise of the right to self
organization and collective bargaining of the employees, especially considering that such was
undertaken previous to the commencement of the negotiation and simultaneously with
Divinagracia’s suggestion that the bank lawyers be excluded from its negotiating panel. The records
show that after the initiation of the collective bargaining process, with the inclusion of Umali in the
Union’s negotiating panel, the negotiations pushed through.
GMC V. CA February 11, 2004

FACTS: In its two plants located at Cebu City and Lapu-Lapu City, petitioner General Milling Corporation
(GMC) employed 190 workers. They were all members of private respondent General Milling
Corporation Independent Labor Union, a duly certified bargaining agent.
GMC and the union concluded a collective bargaining agreement (CBA) which included the issue of
representation effective for a term of three years. The CBA was effective for three years retroactive to
December 1, 1988. Hence, it would expire on November 30, 1991.
A day before the expiration of the CBA, the union sent GMC a proposed CBA, with a request that a
counter-proposal be submitted within ten (10) days.
However, GMC had received collective and individual letters from workers who stated that they had
withdrawn from their union membership, on grounds of religious affiliation and personal differences.
Believing that the union no longer had standing to negotiate a CBA, GMC did not send any counter-
proposal.
GMC wrote a letter to the union's officers, Rito Mangubat and Victor Lastimoso. The letter stated that
it felt there was no basis to negotiate with a union which no longer existed, but that management was
nonetheless always willing to dialogue with them on matters of common concern and was open to
suggestions on how the company may improve its operations.
In answer, the union officers wrote a letter disclaiming any massive disaffiliation or resignation from
the union and submitted a manifesto, signed by its members, stating that they had not withdrawn from
the union.
ISSUE: Whether there GMC violated its duty to bargain collectively which amounts to unfair labor
practice. – YES
HELD: Yes. Under Article 252 (now Article 263), both parties are required to perform their mutual
obligation to meet and convene promptly and expeditiously in good faith for the purpose of negotiating
4CEF 2021-2022 26
an agreement. The union lived up to this obligation when it presented proposals for a new CBA to GMC
within three (3) years from the effectivity of the original CBA. But GMC failed in its duty under Article
252. What it did was to devise a flimsy excuse, by questioning the existence of the union and the status
of its membership to prevent any negotiation.
It bears stressing that the procedure in collective bargaining prescribed by the Code is mandatory
because of the basic interest of the state in ensuring lasting industrial peace.
We hold that GMC's refusal to make a counter-proposal to the union's proposal for CBA negotiation is
an indication of its bad faith. Where the employer did not even bother to submit an answer to the
bargaining proposals of the union, there is a clear evasion of the duty to bargain collectively.
Failing to comply with the mandatory obligation to submit a reply to the union's proposals, GMC
violated its duty to bargain collectively, making it liable for unfair labor practice. Perforce, the Court of
Appeals did not commit grave abuse of discretion amounting to lack or excess of jurisdiction in finding
that GMC is, under the circumstances, guilty of unfair labor practice.
HACIENDA FATIMA V. NFSW FOOD AND GENERAL January 28, 2003

TRADE
FACTS: Respondents are employees of the petitioner, working as sugarcane workers. After they
established a union and successfully won in the certification election as SEBA, petitioner, in addition to
its refusal to negotiate a CBA with the respondent Union, also stopped giving work to the sugarcane
workers.
The Union staged strikes in 2 instances, but the petitioner still refused to give them work. The Union
alleged that the petitioner is committing ULP.
In its defense, the petitioner claims that it is the workers who are “choosy” in work, and also argued
that they are not regular employees anyway, but only seasonal employees.
ISSUE:
1. WON the sugarcane workers are regular employees. – YES
2. WON the petitioner is guilty of ULP. – YES
HELD:
1. Respondents are REGULAR employees. To exclude them from the “regular” status, it is not enough
that they are only performing work seasonal in nature. The ER must also prove that EEs are
employed only for the duration of the season.
In this case, respondents are regularly called by the petitioner to perform services in the sugarcane.
The engagement was repeatedly availed of through several years. Further, under the Labor Code, those
employees who are called to work from time to time and are temporarily laid off during off-season are
not separated from service in said period, but merely considered on leave until they are re-employed.
They are regular employees for their respective tasks.
2. The NLRC found herein petitioners guilty of unfair labor practice, and this decision was upheld by
the SC.
"Indeed, from respondents' refusal to bargain, to their acts of economic inducements resulting in the
promotion of those who withdrew from the union, the use of armed guards to prevent the organizers to
come in, and the dismissal of union officials and members, one cannot but conclude that respondents
4CEF 2021-2022 27
did not want a union in their hacienda—a clear interference in the right of the workers to self-
organization.”
ST. JOHN COLLEGES INC. V. JOHN ACADEMY October 27, 2006

FACULTY AND EMPLOYEES UNION
FACTS: The CBA between SJCI and the Union was set to expire. During the ensuing negotiations, SJCI
rejected all the proposals of the Union for an increase in worker's benefits. This resulted to a bargaining
deadlock which led to the holding of a valid strike by the Union. Subsequently, the SOLE issued an Order
assuming jurisdiction over the labor dispute. Pending resolution thereof, the Board of Directors of SJCI
approved a resolution recommending the closure of the high school.
SJCI informed the DOLE that 25 employees refused to accept their separation compensation package.
The Union filed a notice of strike. SJCI filed a petition to declare the strike illegal. The 25 employees
filed a complaint for unfair labor practice (ULP) and illegal dismissal, alleging that the closure of the
high school was done in bad faith in order to get rid of the Union and render useless any decision of
the SOLE on the CBA deadlocked issues.
The LA dismissed the Union's complaint for ULP and illegal dismissal while granting SJCI's petition to
declare the strike illegal coupled with a declaration of loss of employment status of the 25 Union
members involved in the strike. SJCI resolved to reopen the high school. However, it did not restore
the employees it earlier terminated. The NLRC reversed. The CA affirmed.
ISSUE: W/N SJCI is liable for ULP and illegal dismissal. – YES
HELD: The timing of, and the reasons for the closure of the high school and its reopening after only one
year from the time it was closed down, show that the closure was done in bad faith for the purpose
of circumventing the Union's right to collective bargaining and its members' right to security of
tenure. Consequently, SJCI is liable for ULP and illegal dismissal.
By admitting that the closure was due to irreconcilable differences, specifically, the financial aspect of
the ongoing CBA negotiations, SJCI in effect admitted that it wanted to end the bargaining deadlock
and eliminate the problem of dealing with the demands of the Union. This is precisely what the Labor
Code abhors and punishes as unfair labor practice since the net effect is to defeat the Union's right to
collective bargaining. If SJCI found the Union's demands excessive, its remedy under the law is to refer
the matter for voluntary or compulsory dispute resolution.
Finally, we agree with the findings of the NLRC and CA that the protest actions of the Union cannot be
considered a strike because, by then, the employer-employee relationship has long ceased to exist
because of the previous closure of the high school.
CENTRAL AZUCARERA DE BAIS EMPLOYEES UNION November 17, 2010

NFL V. CENTRAL AZUCARERA DE BAIS INC.
FACTS: A collective bargaining negotiations between CABEU-NFL, the certified bargaining agent and
Central Azucarera De Bais, Inc. (CAB) resulted in a deadlock when the company, in its counter proposal,
did not agree with the proposal of the union. After that, the Union which Mr. Saguran, the Union
President, purportedly represents has already lost its majority status by reason of the disauthorization
and withdrawal of support thereto by more than 90% of the rank and file employees in the bargaining
unit of Central and the workers themselves, acting as principal, after disauthorizing the previous agent
CABEU-NFL have organized themselves into a new Union known as Central Azucarera de Bais
4CEF 2021-2022 28
Employees Labor Association (CABELA) and after obtaining their registration certificate and making due
representation that it is a duly organized union representing almost all the rank and file workers in the
Central, had concluded a new collective bargaining agreement with the Central. The aforesaid CBA had
been duly ratified by the rank and file workers constituting 91% of the collective bargaining unit.
LA dismissed the ULP case, however, NLRC reversed it, and the latter’s decision was reversed also by
CA.
ISSUE: Whether or not an employer is guilty of unfair labor pactice when it concludes a New CBA with
a new union composed of the former members of the Certified Bargaining Agent considering the
collective bargaining negotiations resulted in a deadlock.
HELD: No. CAB is being accused of violating its duty to bargain collectively supposedly because of its act
in concluding a CBA with CABELA, another union in the bargaining unit, and its failure to resume
negotiations with CABEU-NFL.
For a charge of unfair labor practice to prosper, it must be shown that CAB was motivated by ill will,
“bad faith, or fraud, or was oppressive to labor, or done in a manner contrary to morals, good customs,
or public policy, and, of course, that social humiliation, wounded feelings or grave anxiety resulted x x
x” in suspending negotiations with CABEU-NFL. Notably, CAB believed that CABEU-NFL was no longer
the representative of the workers. It just wanted to foster industrial peace by bowing to the wishes of
the overwhelming majority of its rank and file workers and by negotiating and concluding in good faith
a CBA with CABELA.” Such actions of CAB are nowhere tantamount to anti-unionism, the evil sought to
be punished in cases of unfair labor practices.
UFE-DFA-KMU V. NESTLE PHILS. INC. March 3, 2008

FACTS: Since the CBA between Nestle and petitioner was to end, the President of Alabang and Cabuyao
Divisions of petitioner informed Nestle of their intent to open their new CBA. Nestle informed them
that it was also preparing its own counter-proposal. During the negotiations, Nestle reiterated its stance
that the Retirement Plan, among others, is not a proper subject of CBA negotiations and shall be
excluded. A dialogue between them ensued but Nestle requested the NCMB to conduct preventive
mediation proceedings because of an alleged impasse in said dialogue. Conciliation proceedings were
ineffective and petitioner later filed Notice of Strike.
ISSUE: WON Nestle is guilty of bad faith in negotiating with the CBA so as to amount to ULP.
HELD: No, Nestle is NOT guilty of bad faith in negotiating with the CBA. The letter sent by Nestle is not
tantamount to refusal to bargain. Nestle never refused to bargain collectively with UFE-DFA-KMU. The
corporation simply wanted to exclude the Retirement Plan from the issues to be taken up during CBA
negotiations, on the postulation that such was in the nature of a unilaterally granted benefit. An
adamant insistence on a bargaining position to the point where the negotiations reach an impasse does
not establish bad faith. And the management’s firm stand against the issue of the Retirement Plan did
not mean that it was bargaining in bad faith. It had a right to insist on its position to the point of
stalemate.
NOTE: There is no per se test of good faith in bargaining. Good faith or bad faith is an interference to
be drawn from the facts. To some degree, the question of good faith may be a question of credibility.
The effect of an employer’s or a union’s individual actions is not the test of good-faith bargaining, but
the impact of all such occasions or actions, considered as a whole, and the inferences fairly drawn
therefrom collectively may offer a basis for the finding of the NLRC.
4CEF 2021-2022 29
MALAYANG MANGAGAWA NG STAYFAST V. NLRC August 28, 2014
FACTS: Petitioner filed a notice of strike in the NCMB which the respondent company sought to dismiss
on the ground that petitioner was not the certified bargaining agent. Petitioner’s members staged a
“sit-down strike” to dramatize their demands. Respondent company terminated the services of the
participants after they failed to explain their actions. Petitioner staged a strike and filed a complaint for
unfair labor practice, union busting, and illegal lockout against the respondent company.
ISSUE: WON the company is liable for unfair labor practice
HELD: No. While union may file a notice of strike on behalf of its members, petitioner failed to cite any
instance of discrimination or harassment when it filed its notice of strike and the incidents mentioned
as discriminatory occured after the filing of the said notice.
Assuming the strike was legal at the beginning, it became illegal when petitioner committed acts
prohibited under Article 264(e) of the LC, such as acts of violence, coercion and intimidation and
obstruction of the free ingress to and egress from respondent company’s premises. Moreover, the
union filed no new notice of strike that could have supported its charges of discriminatory acts and
unfair labor practice.
HOLY CHILD CATHOLIC SCHOOL V. SEC OF LABOR July 23, 2013

FACTS: Private respondents filed a petition for certification of election alleging that HCCS-TELU-PIGLAS
is a legitimate labor organization duly registered with the DOLE. On the other hand, petitioner on its
comment and position paper insisted that members of the private respondent do not belong in the
same class, as they were composed of managerial, supervisory, and rank and file employees. Likewise,
they were composed of teaching and non-teaching personnel—therefore, they do not represent the
same interests. Not being in accord with Article 245 of the Labor Code, private respondent is an
illegitimate labor organization lacking in personality to file a petition for certification election.
ISSUE: Whether or not a petition for certification election is dismissible on the ground that the labor
organization’s membership allegedly consists of supervisory and rank-and-file employees.
HELD: While there is prohibition against the mingling of supervisory and rank and file employees in one
labor organization, the Labor Code does not provide for the effects thereof. Thus, after a labor
organization has been registered, it may exercise all the rights and privileges of a legitimate labor
organization. Any mingling between supervisory and rank and file employees in its membership cannot
affect its legitimacy for that is not among the grounds for cancellation of registration, unless such
mingling was brought about by misrepresentation, false statement or fraud under Article 239 of the
Labor Code. Hence, petitioner cannot collaterally attack the legitimacy of private respondent by praying
for the dismissal of the petition for certificate election because except when it is requested to bargain
collectively, an employer is a mere bystander to any petition for certificate election. Such proceeding
is non-adversarial and is merely investigative, for the purpose thereof is to determine which
organization will represent the employees in their collective bargaining with the employer. The
employer’s only right in the proceeding is to be notified or informed thereof.
NOTE: The "Bystander Rule" is already well entrenched in this jurisdiction; that a certification election is the sole
concern of the workers, except when the employer itself has to file the petition pursuant to Article 259 of the Labor
Code, as amended, but even after such filing its role in the certification process ceases and becomes merely a
bystander. The employer clearly lacks the personality to dispute the election and has no right to interfere at all
therein. This is so since any uncalled-for concern on the part of the employer may give rise to the suspicion that it is
batting for a company union. This is based on the rationale that the employees’ bargaining representative should
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be chosen free from any extraneous influence of the management; that, to be effective, the bargaining
representative must owe its loyalty to the employees alone and to no other.
EMPLOYEE OF BAYER PHILS. V BAYER PHILS.

FACTS: Employees Union of Bayer Philippines (EUBP), an affiliate of the Federation of Free Workers
(FFW), is the exclusive bargaining agent of all rank-and-file employees of Bayer Philippines (Bayer).
During the negotiation of EUBP and Bayer, EUBP rejected the 9.9% wage increase proposal of Bayer
resulting in a deadlock. Subsequently, EUBP staged a strike prompting SOLE to assume jurisdiction over
the dispute.
A new CBA was executed pursuant to the arbitral award of DOLE. After 6 months from the signing of
the new CBA, Remigio collected signatures from union members to rename the union to REUBP
(Remegio Group) and to adopt new constitution and by-laws. Remigio asked Bayer to desist from
transacting with EUBP. Facundo, President of EUBP, requested Bayer to remit the union dues in favor
of EUBP (Facundo Group). Initially, Bayer decided not to deal with either groups and placed the union
dues collected in a trust account.
EUBP filed the first ULP complaint against Bayer for non-remittance of union dues. Bayer thereafter
decided to turn over the collected union dues to the treasurer of REUBP. EUBP filed the 2nd ULP
complaint against Bayer charging the latter with ULP committed by organizing a company union, gross
violation of the CBA and violation of their duty to bargain. They alleged that despite requests to
renegotiate what was the current CBA at that time (1997-2001 CBA), Bayer instead opted to negotiate
with Remigio’s group, and that the two agreed to sign a new CBA.
The ULP complaints were dismissed for lack of jurisdiction. NLRC sustained, and the CA affirmed the LA
and NLRC.
ISSUE: W/N the act of the management of Bayer in dealing and negotiating with Remigio’s group
despite a validly existing CBA with EUBP can be considered ULP. - YES
HELD: CBA’s purpose is to foster stability and mutual cooperation between labor and capital. An
employer shall not be allowed to rescind unilaterally the CBA contracted with a duly certified bargaining
agent and bargain anew with a different group without the proper procedure. Where there is a CBA,
the duty to bargain collectively shall also mean that neither party shall terminate nor modify such
agreement during its lifetime. A CBA entered into by the SEBA and employer becomes the law between
them. Compliance thereof is mandated by express provisions of law to afford protection to labor and
promote industrial peace. If the employer grossly violates its CBA with the duly recognized union, the
former may be held administratively and criminally liable for ULP.
SACORU V. CCBPI October 4, 2017

FACTS: CCBPI issued notices of termination to 27 rank-and-file, regular employees and members of
petitioner union on the ground of redundancy due to the ceding out of two selling and distribution
systems, the Conventional Route System (CRS) and Mini Bodega System (MB) to the Market Execution
Partners. Union members were put on leave of absence with pay until the effectivity date of their
termination and were granted separation packages.
Petitioner alleged that the redundancy program would result in the diminution of the union
membership amounting to union busting and to a violation of the CBA. CCBPI, for its part, argued that
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the new business scheme is basically a management prerogative designed to improve the system of
selling and distributing products.
The NLRC dismissed the complaint for unfair labor practice and declared as valid the dismissal of the
employees due to redundancy.
ISSUE: Whether CCBPI's implementation of the redundancy program was an unfair labor practice. – NO
HELD: NO. As held in Zambrano v. Philippine Carpet Manufacturing Corp., to prove the existence of
unfair labor practice, substantial evidence has to be presented. Here, the NLRC found that SACORU
failed to provide the required substantial evidence. Thus, the consequent dismissal of 27 regular
members of the complainant's union due to redundancy is not per se an act of unfair labor practice
amounting to union busting.
The termination was due to a scheme that CCBPI adopted and implemented which was an exercise of
management prerogative, and that there was no proof that it was exercised in a malicious or arbitrary
manner. Even if it caused the termination of some 27 employees, it was not in violation of their right
to self-organization, much more in violation of their right to security of tenure because the essential
freedom to manage business remains with management.
SWOFLU V. UNIVERSAL ROBINA CORP July 5, 2017

FACTS: The concerned SONEDCO Workers Free Labor Union members are asking that the wage increase
given to their fellow employees be awarded to them as well. Their co-workers of the same rank are
allegedly earning ₱32.00/day more than they are receiving.
In 2007, while there was no CBA in effect, URC-SONEDCO offered a ₱l6.00/day wage increase to their
employees. To receive the benefits, employees had to sign a waiver that said “In the event that a CBA
is negotiated between Management and Union, the new CBA shall only be effective [on] January 1,
2008." Realizing that the waiver was an unfair labor practice, some members of Union refused to sign.
In 2008, URC-SONEDCO offered the same arrangement. It extended an additional ₱l6.00/day wage
increase to employees who would agree that any CBA negotiated for that year would only be effective
on January 1, 2009. Several members of the Union again refused to waive their rights. Consequently,
they did not receive the wage increase which already amounted to a total of ₱32.00/day, beginning
2009.
ISSUE: Whether or not the Management committed unfair labor practice. – YES
HELD: Yes. According to petitioners, the "₱32.00/day [wage increase] was integrated to the wage[s] of
those who signed the waivers so that they are receiving the wage increase of ₱32.00/day up to now.”
The respondent company granted this benefit to its employees to induce them to waive their collective
bargaining rights. Accordingly, it is illegal to continue denying the petitioners the wage increase that
was granted to employees who signed the waivers. To rule otherwise will perpetuate the discrimination
against petitioners. All the consequences of the unfair labor practice must be addressed.
Generally, CBA controls the relationship between the parties. Any benefit not included in the CBA is not
demandable. However, if it was withheld by the employer as part of its unfair labor practice against the
union members, this benefit should be granted. In light of the peculiar circumstances in this case, the
requested wage increase should be granted.
PEU V. ESQUIVEL ET AL. December 1, 2016
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FACTS: PEU BOD passed a Local Board Resolution authorizing the affiliation of PEU with NUWHRAIN,
and the direct membership of its individual members thereto. The act was submitted to the general
membership and ratified by the members.
PEU-NUWHRAIN sought to increase the union dues/agency fees from 1% to 2% of the R&F ees brought
by the affiliation. SOLE resolved the bargaining deadlock by ordering the parties to execute a CBA. The
parties have yet to sign a CBA but have, for most part, implemented the arbitral award.
Non-PEU members objected the increase of agency fees arguing that: (a) the new CBA is unenforceable
since no written CBA has been formally signed and executed by PEUNUWHRAIN and the Hotel; (b) the
2% agency fee is exorbitant and unreasonable; and (c) PEUNUWHRAIN failed to comply with the
mandatory requirements for such increase.
ISSUES:
1. WON PEU-NUWHRAIN has right to collect the increased agency fees -YES
2. WON PEU-NUWHRAIN failed to comply with the mandatory requirements for such increase-YES
HELD:
1. The recognized collective bargaining union which successfully negotiated the CBA with the
employer is given the right to collect a reasonable fee called “agency fee” from non-union members
who are employees of the appropriate bargaining unit, in an amount equivalent to the dues and
other fees paid by union members, in case they accept the benefits under the CBA. While the
collection of agency fees is recognized by Article 259 (formerly Article 248) of the Labor Code, as
amended, the legal basis of the union’s right to agency fees is neither contractual nor statutory,
but quasi-contractual, deriving from the established principle that non-union employees may not
unjustly enrich themselves by benefiting from employment conditions negotiated by the bargaining
union. In the present case, PEU-NUWHRAIN’s right to collect agency fees is not disputed.
2. Case law interpreting Article 250 (n) and ( o ) of the Labor Code mandates the submission of three
(3) documentary requisites in order to justify a valid levy of increased union dues. These are: (a) an
authorization by a written resolution of the majority of all the members at the general membership
meeting duly called for the purpose; (b) the secretary’s record of the minutes of the meeting, which
shall include the list of all members present, the votes cast, the purpose of the special assessment
or fees and the recipient of such assessment or fees; and (c) individual written authorizations for
check-off duly signed by the employees concerned. In the present case, however, PEU-NUWHRAIN
failed to show compliance with the foregoing requirements. It attempted to remedy the
“inadvertent omission” of the matter of the approval of the deduction of two percent (2%) union
dues from the monthly basic salary of each union member.
While the matter of implementing the two percent (2%) union dues was taken up during the
PEUNUWHRAIN’s 8th General Membership Meeting on October 28, 2008, there was no sufficient
showing that the same had been duly deliberated and approved. The minutes of the Assembly itself
belie PEU-NUWHRAIN’s claim that the increase in union dues and the corresponding check- off were
duly approved since it merely stated that “the [two percent (2%)] Union dues will have to be
implemented,” meaning, it would still require the submission of such matter to the Assembly for
deliberation and approval.
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MODULE 3
ART. 263 [252]. COLLECTIVE BARGAINING AND ADMINISTRATION OF AGREEMENTS
UFE-DFA-KMU V. NESTLE PHILS. INC. March 3, 2008
FACTS: Union of Filipro Employees was the sole and exclusive rank-and-file employees of Nestle
belonging to Nestle’s Alabang and Cabuyao plants.
As their previous CBA was about to end, UFE notified Nestle of their intention to negotiate the new
CBA, to which Nestle replied that it was also preparing its counter proposal. Then in another letter,
Nestle reiterated its stance that “"unilateral grants, one-time company grants, company initiated
policies and programs, which include, but are not limited to the Retirement Plan, Incidental Straight
Duty Pay and Calling Pay Premium, are by their very nature not proper subjects of CBA negotiations
and therefore shall be excluded therefrom." Later on, after preventive mediation proceedings it later
became a labor dispute.
UFE argued that Nestle violated its duty to bargain collectively when it pre conditioned the negotiations
to the exclusion of the issue of the Retirement plan in the CBA negotiations.
ISSUE: Whether or not, Nestle violated its duty to bargain collectively.
HELD: No, Article 263 of the Labor Code provides that the purpose of collective bargaining is the
reaching of an agreement resulting in a contract binding on the parties; but the failure to reach an
agreement after negotiations have continued for a reasonable period does not establish a lack of good
faith. The statutes invite and contemplate a collective bargaining contract, but they do not compel one.
The duty to bargain does not include the obligation to reach an agreement. In this case Nestle never
refused to bargain collectively, it just wanted to exclude the Retirement Plan from the issues to be
taken up during CBA negotiations.
UST FACULTY UNION V. UST April 7, 2009

FACTS: Fr. Rodel Aligan, the Secretary General of the UST, issued a memorandum allowing the request
of the Faculty Clubs to the university to hold a convocation on October 4, 1996. Later on the members
of the faculties of the UST attended the convocation, including the members of the UST-FU, without
the participation of the members of the UST Administration. Also during the convocation, an election
for the officers of the USTFU was conducted by a group called the Reformist Alliance. Upon learning
that the convocation was intended to be an election, members of the USTFU walked out. Meanwhile,
an election was conducted among those present, and Gil Gamila, among other faculty members were
elected as the president and officers.
The then incumbent President was Atty. Eduardo Mariño, Jr. The Mariño group then filed a complaint
for ULP against the UST with the Arbitration branch of the NLRC. It also filed a complaint with the office
of the Med-Arbiter of DOLE, praying for the nullification of the election of the Gamila Group as officers
of the USTFU.
During the pendency of the cases filed, a CBA was entered between the Gamila Group and the UST. It
superseded the previous CBA agreed upon.
ISSUE: WON UST is guilty of ULP and thus the CBA is void.
HELD: No. UST is not guilty of ULP and thus the CBA is not void. Art. 252 of the Labor Code provides
that “The duty to bargain collectively means the performance of a mutual obligation to meet and
convene promptly and expeditiously in good faith for the purpose of negotiating an agreement with
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respect to wages, hours of work and all other terms and conditions of employment including proposals
for adjusting any grievances or questions arising under such agreement and executing a contract
incorporating such agreements if requested by either party but such duty does not compel any party
to agree to a proposal or to make any concession.” It is not the duty or obligation of respondents to
inquire into the validity of the election of the Gamilla Group. Such an issue is properly an intra-union
controversy subject to the jurisdiction of the med-arbiter of the DOLE. Respondents could not have
been expected to stop dealing with the Gamilla Group on the mere accusation of the Mariño Group
that the former was not validly elected into office.
GENERAL MILLING CORPORATION V. CA February 2004

FACTS: In the two plants of petitioner, all of the workers therein are members of private respondent
General Milling Independent Labor Union, a duly certified Collective bargaining agent. On April 28, 1989
GMC and the union concluded a CBA. It was effective for three years retroactive to Dec. 1, 1988. Hence
it would expire on Nov. 30, 1991. Then on Nov 29, 1991, the Union sent the petitioner a proposed CBA,
with a request that a counter proposal be submitted within 10 days. Then due to reports that there is
a massive disaffiliation with the Union. GMC did not send any counter proposal, believing that the
Union no longer had standing to negotiate. The Union officers negated the report. Later on, Marcia
Tumbiga, a union member was dismissed on the ground of incompetence. The Union protested and
requested GMC to submit the matter to the grievance procedure .
Then, the Union filed a complaint against GMC with the NLRC alleging that GMC committed;1.) refusal
to bargain collectively; 2.) interference with the right to self-organization and 3.) discrimination
ISSUE: WON GMC is guilty of ULP.
HELD: Yes. Art. 253 provides that the representation provision of a CBA should last for 5 years. The
relation between labor and management should be undisturbed until the last 60 days of the fifth year.
Hence, it is indisputable that when the union requested for a renegotiation of the economic terms of
the CBA on Nov. 1, 1991, it was still the certified collective bargaining agent of the workers, because it
was seeking said renegotiation within 5 years from the date of the effectivity of the CBA on December
1, 1988. The union's proposal was also submitted within the prescribed 3-year period from the date of
effectivity of the CBA, albeit just before the last day of said period. It was obvious that GMC had no
valid reason to refuse to negotiate in good faith with the union. For refusing to send a counter-proposal
to the union and to bargain anew on the economic terms of the CBA, the company committed an unfair
labor practice under Article 248 of the Labor Code, which provides that the employer is liable for ULP if
it violates the duty to bargain collectively.
KIOK LOY V. NLRC January 22, 1986

FACTS: The Pambansang Kilusan ng Paggawa, won in a certification election and became the sole and
exclusive bargaining agent of the rank-and-file employees of Sweden Ice Cream plant. Later on, the
Union wanted to enter negotiations with the Company with regard to the CBA. However, all of their
attempts to negotiate were ignored. Consequently, the Union then filed a notice of strike on the ground
of unresolved economic issues. Then during the pendency of the proceedings, the company requested
a series of extensions until it was denied and was deemed to have waived its right to present evidence.
Now Petitioner company now maintains that its right to procedural due process has been violated when
it was precluded from presenting further evidence in support of their contentions. They further contend
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that the NLRC finding of ULP for refusal to bargain is not supported by law, and that the bargaining
agreement is unreasonable.
ISSUE: WON, Petitioner company is guilty of ULP
HELD: Yes, petitioner Company is guilty of Unfair Labor Practice. While it is a mutual obligation of the
parties to bargain, the employer, however, is not under any legal duty to initiate contract negotiation.
The mechanics of collective bargaining is set in motion only when the following jurisdictional
preconditions are present, namely,
1. possession of the status of majority representation of the employees' representative in accordance
with any of the means of selection or designation provided for by the Labor Code;
2. proof of majority representation; and
3. a demand to bargain under Article 251, par. (a) of the New Labor Code, all of which are present in
this case.
It has been indubitably established that; (1) respondent Union was a duly certified bargaining agent;
(2) it made a definite request to bargain, accompanied with a copy of the proposed Collective
Bargaining Agreement, to the Company not only once but twice which were left unanswered and
unacted upon; and (3) the Company made no counter proposal whatsoever all of which conclusively
indicate lack of a sincere desire to negotiate. A Company's refusal to make a counter proposal if
considered in relation to the entire bargaining process, may indicate bad faith and this is specially true
where the Union's request for a counter proposal is left unanswered. Petitioner has not at any instance
evinced good faith or willingness to discuss freely and fully the claims and demands set forth by the
Union much less justify its opposition thereto.
COLEGIO DE SAN JUAN DE LETRAN VS. September 18, 2000

ASSOCIATION OF EMPLOYEES AND FACULTY OF
LETRAN
FACTS: In December 1992, Respondent Union elected a new set of officers wherein private respondent
Eleanor Ambas emerged as the newly elected President. Ambas then moved for renegotiation of the
CBA but petitioner, through Fr. Lao claimed the CBA was already prepared for signing by the parties.
Then the disputed CBA was rejected by the union members. Petitioner, accused the union officers of
bargaining in bad faith. Later on, the parties agreed to disregard the disputed CBA and to enter
negotiations anew. Proposals were then sent by the Union. Then, Ambas found out that her work
schedule was changed. Ambas protested and requested management to submit the issue to a grievance
machinery under the old CBA. Then due to the petitioner's inaction, the union filed a notice of strike.
Later on, Ambas was dismissed. Later, due to the reception of information that a new Union filed a
petition for certification election, petitioner halted negotiations with the respondent union. The strike
then went forward. Respondent then filed an action to declare petitioner guilty of ULP.
ISSUE: WON Petitioner is liable for ULP.
HELD: Yes, petitioner is liable for ULP. Petitioner showed a lack of sincere desire to negotiate rendering
it guilty of ULP for refusal to bargain with the Union. In order to allow the employer to validly suspend
the bargaining process there must be a valid petition for certification election raising a legitimate
representation issue. Hence, the mere filing of a petition for certification election does not ipso facto
justify the suspension of negotiation by the employer. The petition for certification election must first
comply with the provisions of the Labor Code and its IRR. The petition must be filed during the 60day
period.
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In the case at bar, the lifetime of the previous CBA was from 1989-1994. The petition for certification
election by ACEC, allegedly a legitimate labor organization, was filed with the Department of Labor and
Employment (DOLE) only on May 26, 1996. Clearly, the petition was filed outside the sixty-day freedom
period. Hence, the filing thereof was barred by the existence of a valid and existing collective bargaining
agreement. Consequently, there is no legitimate representation issue and, as such, the filing of the
petition for certification election did not constitute a bar to the ongoing negotiation
PAL V. PALEA March 12, 2008

FACTS: PAL and Respondent entered into a CBA covering the period of 1986-1989. Under the CBA it
granted PAL’s rank-and-file employees certain bonuses. Later on, right before the payment of the 13
month pay. PALEA assailed the implementation of such measure claiming that regular and non-regular
employees must be paid their 13 month pay. PAL argued that rank-and-file employees who were
regularized after April 30, 1988 were not entitled to 13th month pay as they were already given their
christmas bonuses on December 9, 1988. Consequently, PALEA filed a labor complaint for ULP against
PAL. It alleged that the period of regularization should not be used as the parameter for granting the
13th month pay.
ISSUE: WON the CBA extends to non-members of the Sole and exclusive bargaining agent.
HELD: Yes, the CBA extends to non-members of the SEBA, It is a well-settled doctrine that the benefits
of a CBA extend to the laborers and employees in the collective bargaining unit, including those who
do not belong to the chosen bargaining labor organization. Otherwise, it would be a clear case of
discrimination. Hence, to be entitled to the benefits under the CBA, the employees must be members
of the bargaining unit, but not necessarily of the labor organization designated as the bargaining agent.
Here, the employees subject of the issue is part of the bargaining unit although not members of the
Respondent Union.
FVC LABOR UNION V. SANAMA-FVC-SIGLO November 27, 2009

FACTS: On Dec. 22, 1997 Petitioner, the recognized bargaining agent of the RNF employees of the FVC
Philippines, signed a 5 year CBA covering the period from Feb. 1,1998 to January 30, 2003. Then after
renegotiation on the third year. The period, among others, were changed wherein, the CBA was
extended for 4 months starting from Feb 1, 2001 up until May 31, 2003. Then nine days before the
expiration of the original five year period on January 30, 2003 the Respondent Union filed before the
DOLE a petition for certification election for the same rank-and-file unit covered by petitioner union’s
CBA. They claimed that it was within the 60 day period. The DOLE however later, denied the petition
on the ground that in the amended CBA the expiration of the CBA was until May 31, 2003 and that since
respondent members fully accepted and in fact received the benefits arising from the amendments,
they also accepted the extended term of the CBA and cannot now file a petition for certification election
based on the original CBA expiration date.
ISSUE: WON the petition for certification election should be granted.
HELD: Yes. Art. 265 provides that, 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
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Bargaining Agreement. All other provisions of the Collective Bargaining Agreement shall be
renegotiated not later than three (3) years after its execution.
While the parties may agree to extend the CBAs original five-year term together with all other CBA
provisions, any such amendment or term in excess of five years will not carry with it a change in the
union’s exclusive collective bargaining status. By express provision of the above-quoted Article 253-A,
the exclusive bargaining status cannot go beyond five years and the representation status is a legal
matter not for the workplace parties to agree upon. In other words, despite an agreement for a CBA
with a life of more than five years, either as an original provision or by amendment, the bargaining
unions exclusive bargaining status is effective only for five years and can be challenged within sixty (60)
days prior to the expiration of the CBAs first five years. The negotiated extension of the CBA term has
no legal effect on the FVCLU-PTGWOs exclusive bargaining representation status which remained
effective only for five years ending on the original expiry date of January 30, 2003.
ART. 265 [253-A]. TERMS OF A CBA

FVC LABOR UNION- PHIL. TRANSPORT AND November 27, 2009
GENERAL WORKERS ASSOCIATION V. SANAMA-
FVC-SIGLO
FACTS: On Dec. 22, 1997 Petitioner, the recognized bargaining agent of the RNF employees of the FVC
Philippines, signed a 5 year CBA covering the period from Feb. 1,1998 to January 30, 2003. Then after
renegotiation in the third year. The period, among others, were changed wherein, the CBA was
extended for 4 months starting from Feb 1, 2001 up until May 31, 2003. Then nine days before the
expiration of the original five year period on January 30, 2003 the Respondent Union filed before the
DOLE a petition for certification election for the same rank-and-file unit covered by petitioner union’s
CBA. They claimed that it was within the 60 day period. The DOLE however later, denied the petition
on the ground that in the amended CBA the expiration of the CBA was until May 31, 2003 and that since
respondent members fully accepted and in fact received the benefits arising from the amendments,
they also accepted the extended term of the CBA and cannot now file a petition for certification election
based on the original CBA expiration date.
ISSUE: WON the petition for certification election should be granted.
HELD: Yes. Art. 265 provides that, 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.
While the parties may agree to extend the CBAs original five-year term together with all other CBA
provisions, any such amendment or term in excess of five years will not carry with it a change in the
union’s exclusive collective bargaining status. By express provision of the above-quoted Article 253-A,
the exclusive bargaining status cannot go beyond five years and the representation status is a legal
matter not for the workplace parties to agree upon. In other words, despite an agreement for a CBA
with a life of more than five years, either as an original provision or by amendment, the bargaining
unions exclusive bargaining status is effective only for five years and can be challenged within sixty (60)
days prior to the expiration of the CBAs first five years. The negotiated extension of the CBA term has
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no legal effect on the FVCLU-PTGWOs exclusive bargaining representation status which remained
effective only for five years ending on the original expiry date of January 30, 2003.
SMCEU-PTGWO V. CONFESOR September 19, 1996

FACTS: Petitioner Union entered into a CBA with SMC to take effect upon the expiration of the previous
CBA or on June 30, 1989 until June 30, 1992. As far as the representation aspect is concerned, CBA shall
be for 5 years from July 1,1989 to June 30, 1994. Hence, the freedom period for purposes of such
representation shall be 60 days prior to June 30, 1994. Sometime in July 1992, a renegotiation between
petitioner and SMC started. The terms of which, of the new CBA, shall be effective only for the
remaining two years or until June 30, 1994. SMC on the other hand, contended that
members/employees who had moved to Magnolia and SMFI automatically ceased to be part of the
bargaining unit at the SMC. Furthermore, the CBA should be effective for three years in accordance
with Art. 253-A of the Labor Code.
ISSUE: WON the duration of the renegotiated terms of the CBA is to be effective for two years only.
HELD: No, the renegotiated terms of the CBA shall be three years. Article 253-A states that the CBA has
a term of five (5) years instead of three years, before the amendment of the law as far as the
representation aspect is concerned. All other provisions of the CBA shall be negotiated not later than
three (3) years after its execution. The "representation aspect" refers to the identity and majority status
of the union that negotiated the CBA as the exclusive bargaining representative of the appropriate
bargaining unit concerned. "All other provisions" simply refers to the rest of the CBA, economic as well
as non- economic provisions, except representation. The CBA is a contract between the parties and the
parties must respect the terms and conditions of the agreement. Notably, the framers of the law did
not give a fixed term as to the effectivity of the terms and conditions of employment. It can be gleaned
from their discussions that it was left to the parties to fix the period. As a matter of policy the parties
are encouraged to enter into a renegotiated CBA with a term which would coincide with the aforesaid
five (5) year term of the bargaining representative. In the event however, that the parties, by mutual
agreement, enter into a renegotiated contract with a term of three (3) years or one which does not
coincide with the said 5-year term, and said agreement is ratified by majority of the members in the
bargaining unit, the subject contract is valid and legal and therefore, binds the contracting parties. The
same will however not adversely affect the right of another union to challenge the majority status of
the incumbent bargaining agent within sixty (60) days before the lapse of the original five (5) year term
of the CBA.
HBILU V. HSBC February 28, 2018

FACTS: In 2001, BSP issued the Manual of Regulations for Banks (MoRB). Section X338 thereof reads: “
. . . Financing plans and amendments thereto shall be with prior approval of the BSP.” Thus, respondent
HSBC submitted its Financial Assistance Plan (Plan) to the BSP for approval. The Plan allegedly contained
a credit checking proviso. The BSP approved the Plan, was later amended thrice, all of which
amendments were approved by the BSP.
Meanwhile, petitioner HBILU, the incumbent bargaining agent of HSBC's rank-and-file employees,
entered into a CBA with the bank. When the CBA was about to expire, the parties started negotiations
for a new one to cover the period from April 1, 2012 to March 31, 2017. During the said negotiations,
HSBC proposed amendments to Article XI allegedly to align the wordings of the CBA with its BSP-
approved Plan. Particularly, HSBC proposed the deletion of Article XI, Section 4 (Credit Ratio) of the
CBA. HBILU vigorously objected to the proposed amendments, claiming that their insertions would
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curtail its members' availment of salary loans. In view of HBILU's objection, HSBC withdrew its proposed
amendments and, consequently, Article XI remained unchanged. Despite the withdrawal of the
proposal, HSBC sent an e-mail to its employees on April 20, 2012 concerning the enforcement of the
Plan, including the Credit Checking provisions thereof.
Thereafter, in September 2012, HBILU member Vince Mananghaya applied for a loan under the
provisions of Article XI of the CBA. His first loan application in March 2012 was approved, but adverse
findings from the external checks on his credit background resulted in the denial of his September
application. HBILU then raised the denial as a grievance issue with the NCMB. It argued that the
imposition of an additional requirement-the external credit checking prior to approval of any loan
application under Article XI of the CBA-is not sanctioned under the CBA. The Union emphasized that
under the terms of Article XI, there is no such requirement and that it cannot, therefore, be
unilaterally imposed by HSBC.
ISSUE: Whether or not HSBC could validly enforce the credit-checking requirement under its BSP-
approved Plan in processing the salary loan applications of covered employees even when the said
requirement is not recognized under the CBA.
HELD: NO. The provisions of the CBA must be respected since its terms and conditions constitute the
law between the parties. And until a new CBA is executed by and between the parties, they are duty-
bound to keep the status quo and to continue in full force and effect the terms and conditions of the
existing agreement. This finds basis under Article 253 of the Labor Code. In this respect, this Court is of
the view that tolerating HSBC's conduct would be tantamount to allowing a blatant circumvention of
Article 253. It would contravene the express prohibition against the unilateral modification of a CBA
during its subsistence and even thereafter until a new agreement is reached. It would unduly license
HSBC to add, modify, and ultimately further restrict the grant of Salary Loans beyond the terms of the
CBA by simply adding stringent requirements in its Plan, and having the said Plan approved by BSP in
the guise of compliance with the MoRB. HSBC's enforcement of credit checking on salary loans under
the CBA invalidly modified the latter's provisions thereon through the imposition of additional
requirements which cannot be found anywhere in the CBA.
MANILA ELECTRIC CO. V. QUISUMBING February 22 and August 1, 2000 (Resolutions)

FACTS: This petition had its origin in the renegotiation of the parties’ 1992-97 CBA insofar as the last 2-
yr period is concerned. When the SOLE assumed jurisdiction and granted arbitral awards, there was no
question that these awards are to be given retroactive effect. however, the parties dispute the
reckoning period when retroaction shall commence. The court in Jan 27 1999 Decision, stated that the
CBA shall be effective for a period of 2 yrs counted from Dec. 8, 1996 up to Dec. 27, 1999. This actually
covers 3yr period. Labor laws are silent as to when an arbitral award in a labor dispute where SOLE had
assumed jurisdiction shall retroact.
ISSUE: when shall CBA arbitral awards retroact?
HELD: GR is that a CBA negotiated within 6mos after the expiration of existing CBA retroacts to the day
immediately following such date, and if agreed thereafter, the effectivity depends on the agreement of
the parties. On the other hand, the law is silent as to the retroactivity of the government. Despite the
silence of the law, the Court rules that CBA arbitral awards granted AFTER 6MOS FROM EXPIRATION OF
LAST CBA, SHALL RETROACT TO SUCH TIME AGREED UPON by employer, employees, or their union.
absent such an agreement as to retroactivity, the award shall RETROACT TO THE FIRST DAY AFTER THE
6MONTH PERIOD FOLLOWING THE EXPIRATION OF THE LAST DAY OF CBA, should there be one. In
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absence of CBA, the SECRETARY’S DETERMINATION of the date of retroactivity as part of his
discretionary powers over arbitral awards shall control.
The terms or periods set in Art.265 does not prevent its application by analogy to an arbitral award by
the SOLE considering the absence of an applicable law.
ART. 267 [255]. EXCLUSIVE BARGAINING REPRESENTATION AND WORKERS’ PARTICIPATION IN POLICY AND
DECISION-MAKING
INTERNATIONAL SCHOOL ALLIANCE OF June 1, 2000
EDUCATORS V. QUISUMBING
FACTS: : Private respondent International School, Inc. is a domestic educational institution established
primarily for dependents of foreign diplomatic personnel and other temporary residents. It hires both
foreign and local teachers as members of its faculty classifying them as foreign-hires and local-hires. It
grants foreign-hires certain benefits as housing, transportation, shipping costs, taxes and home leave
travel allowance which are not accorded to local-hires.
Foreign-hires are also paid a salary rate of twenty-five percent (25%) more than
the local-hires.When negotiations for a new collective bargaining agreement were held in June 1995,
petitioner International School Alliance of Educators (ISAE) as a legitimate labor union and the collective
bargaining representative of all the faculty members of the school contested the difference in salary
rates between foreign and local hires.
ISSUE: Whether or not foreign-hires should be included in the appropriate bargaining unit. – NO
HELD: A bargaining unit is "a group of employees of a given employer, comprised of all or less than all
of the entire body of employees, consistent with equity to the employer indicate to be the best suited
to serve the reciprocal rights and duties of the parties under the collective bargaining provisions of the
law."
The factors in determining the appropriate collective bargaining unit are (1) the will of the employees
(Globe Doctrine); (2) affinity and unity of the employees’ interest, such as substantial similarity of work
and duties, or similarity of compensation and working conditions (Substantial Mutual Interests Rule);
(3) prior collective bargaining history; and (4) similarity of employment status.
The basic test of an asserted bargaining unit's acceptability is whether or not it is fundamentally the
combination which will best assure to all employees the exercise of their collective bargaining rights. It
does not appear that foreign-hires have indicated their intention to be grouped together with local-
hires for purposes of collective bargaining. The
collective bargaining history in the School also shows that these groups were always treated separately.
Foreign-hires have limited tenure; local-hires enjoy security of tenure. Although foreign-hires perform
similar functions under the same working conditions as the local-hires, foreign-hires are accorded
certain benefits not granted to local-hires. These benefits, such as housing, transportation, shipping
costs, taxes, and home leave travel allowance, are reasonably related to their status as foreign-hires,
and justify the exclusion of the former from the latter. To include foreign-hires in a bargaining unit with
local-hires would not assure either group the exercise of their respective collective bargaining rights.
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NATIONAL ASSOCIATION OF FREE TRADE UNIONS December 21, 1990
V. MAINIT LUMBER DEVELOPMENT COMPANY
WORKERS UNION
FACTS: Private respondent Mainit Lumber Development Company Workers Union-United Lumber and
General Workers of the Philippines, MALDECOWU-ULGWP (ULGWP, for short), a legitimate labor
organization filed a petition for certification election to determine the sole and exclusive collective
bargaining representative among the rank and file workers/employees of Mainit Lumber Development
Company Inc. (MALDECO), employing approximately 136 rank and file employees/workers. The Med-
Arbiter granted the petition for certification election composed of only one bargaining . NAFTU
appealed the decision of the Med-Arbiter on the ground that MALDECO was composed of two (2)
bargaining units, the Sawmill Division in Butuan City and the Logging Division, in Zapanta Valley,
Kitcharao, Agusan Norte, about 80 kilometers distant from each other and in fact, had then two
separate CBA's, one for the Sawmill Division and another for the Logging Division, both the petition and
decision referred only to one bargaining unit; that from 1979 to 1985, the Ministry of Labor and
Employment recognized the existence of two (2) separate bargaining units at MALDECO, one for its
Logging Division and another for its Sawmill Division. But both the petition and decision treated these
separate and distinct units as one.
ISSUE: Whether or not it was right for the med-arbiter to change the employer from two separate
bargaining units to only one. – YES
HELD: First, out of two hundred and one (201) employees of MALDECO, one hundred seventy five (175)
consented and supported the petition for certification election, thereby confirming their desire for one
bargaining representative. Second, while the existence of a bargaining history is a factor that may be
reckoned with in determining the appropriate bargaining unit, the same is not decisive or conclusive.
Other factors must be considered. The test of grouping is community or mutuality of interests. This is
so because "the basic test of an asserted bargaining unit's acceptability is whether or not it is
fundamentally the combination which will best assure to all employees the exercise of their collective
bargaining rights." Certainly, there is a mutuality of interest among the employees of the Sawmill
Division and the Logging Division. Their functions mesh with one another. One group needs the other
in the same way that the company needs them both. There may be difference as to the nature of their
individual assignments but the distinctions are not enough to warrant the formation of a separate
bargaining unit.
ART. 268 [256]. REPRESENTATION ISSUE IN ORGANIZED ESTABLISHMENTS

PICOP RESOURCES INC. V. DEQUILLA ET AL. December 7, 2011
FACTS: PICOP terminated from employment 800 employees (including the respondents) due to acts of
disloyalty, specifically, for allegedly campaigning, supporting and signing a petition for the
certification of a rival union FFW before the 60-day “Freedom period.”
PICOP argues that Article 253 (now Art. 264) of the Labor Code applies in this case that the terms and
conditions of a CBA remain in full force and effect even beyond the 5-year period when no new CBA has
yet been reached (Automatic Renewal Clause). It claims that the private respondents violated this
provision when they campaigned for, supported and signed FFW's petition for certification election on
March 19 and 20, 2000, before the onset of the freedom period.
ISSUE: WON the Automatic Renewal Clause applies in this case? NO.
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HELD: First, the act of "signing an authorization for a petition for certification election" is not disloyalty
to the union per se considering that the petition for certification election itself was filed during the
freedom period which started on March 22, 2000.
The provision for status quo (Automatic Renewal Clause) is conditioned on the fact that no certification
election was filed during the freedom period. In the instant case, four (4) petitions were filed as early
as May 12, 2000. Therefore, following Article 256, at the expiration of the freedom period, PRI's
obligation to recognize the incumbent bargaining agent does not hold true when petitions for
certification election were filed, as in this case. Moreover, the last sentence of Article 253 which
provides for automatic renewal pertains only to the economic provisions of the CBA, and does not
include the representational aspect of the CBA. An existing CBA cannot constitute a bar to a filing of
a petition for certification election.
NATIONAL UNION OF WORKERS IN HOTELS, July 31, 2009

RESTAURANTS AND ALLIED INDUSTRIES- MANILA
PAVILLON HOTEL CHAPTER V. SEC OF LABOR
FACTS: A certification election was conducted on June 16, 2006 among the rank-and-file employees of
respondent Holiday Inn Manila Pavilion Hotel (the Hotel) with the following results:
EMPLOYEES IN VOTERS' LIST = 353
TOTAL VOTES CAST = 346
NUWHRAIN-MPHC = 151
HIMPHLU = 169
NO UNION = 1
SPOILED = 3
SEGREGATED = 22
In view of the significant number of segregated votes, contending unions, petitioner, NUHWHRAIN-
MPHC, and respondent Holiday Inn Manila Pavillion Hotel Labor Union (HIMPHLU), referred the case
back to Med-Arbiter Ma. Simonette Calabocal to decide which among those votes would be opened
and tallied.
ISSUE: WoN HIMPHLU should be certified as the exclusive bargaining agent. – NO
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HELD: It is well-settled that under the so-called "double majority rule," for there to be a valid
certification election, majority of the bargaining unit must have voted AND the winning union must
have garnered majority of the valid votes cast.
Having declared that no choice in the certification election conducted obtained the required majority,
it follows that a run-off election must be held to determine which between HIMPHLU and petitioner
should represent the rank-and-file employees.
A run-off election refers to an election between the labor unions receiving the two (2) highest number
of votes in a certification or consent election with three (3) or more choices, where such a certified or
consent election results in none of the three (3) or more choices receiving the majority of the valid
votes cast; provided that the total number of votes for all contending unions is at least fifty percent
(50%) of the number of votes cast.
COCA COLA BOTTLERS V. ILOCOS PROFESSIONAL September 9, 2015

AND TECHNICAL EMPLOYEES UNION
FACTS: Respondent IPTEU filed a verified petition for certification election, seeking to represent a
bargaining unit consisting of 22 rank-and-file employees of petitioner CCBPI Ilocos Norte. The Med-
Arbiter granted IPTEU’s petition. On the day of the certification election, only 16 out of the 22 members
of IPTEU cast their votes.
CCBPI challenged the election and the votes on the ground that the voters are supervisory and
confidential employees. However, the Med-Arbiter denied CCBPI’s challenge, finding that the voters
are rank-and-file employees holding positions which are not confidential in nature, and who are not
currently members of Ilocos Monthlies Union (IMU) and have been excluded from the CBA entered into
by IMU and CCBPI from 1997 to 2005. Subsequently, IPTEU was proclaimed as the sole and exclusive
bargaining agent of rank-and-file employees in CCBPI Ilocos Norte.
ISSUE: WON the election of IPTEU as the sole and exclusive bargaining agent of CCBPI Ilocos Norte is
invalid due to its members being part of IMU.
HELD: NO. As proven by the certification of the IMU President as well as the CBAs executed between
IMU and CCBPI, the 22 employees sought to be represented by IPTEU are not IMU members and are
not included in the CBAs due to the reclassification of their positions. If these documents were false,
the IMU should have manifested its vigorous opposition. However, it was the CCBPI who vigorously
resisted the petition for certification election. On the other hand, the other existing unions at CCBPI,
including the IMU, which was once the union of most of the IPTEU members, never once opposed the
petition and the certification election.
ARTS. 273-274 [260-261]. GRIEVANCE MACHINERY AND VOLUNTARY ARBITRATION

SANTUYO ET. AL. V. REMERCO GARMETS March 22, 2010 (in relation to 217)
MANUFACTURING INC.
FACTS: Santuyo among others were employed as sewers of Remerco Garments, and are members off
KMM UNION. After an illegal strike against RGMI, petitioners’ employment was conditioned to the fact
that they will be paid now on a piece-rate basis rather than the previous daily rate. Later on, the Union
filed a notice of strike with the National Conciliation and Mediation Board on the ground that RGMI
Committed an unfair labor practice. RGMI violated the CBA by changing the salary scheme among
others.
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During the course of the proceedings respondent argued that the LA had no jurisdiction over the
complaint because it involved the implementation of the CBA. The alleged violations of the CBA should
be resolved according to the grievance procedure laid out therein.
ISSUE: WON the LA has jurisdiction over the case in dispute.
HELD: No. the LA has no jurisdiction over the case in dispute. This is not a simple case of illegal dismissal
but a labor dispute invloving the implementation of the CBA. Pursuant to Articles 217 in relation to
Article 260 and 262 of the Labor Code, The LA should have referred the matter to the grievance
machinery provided in the CBA because the Labor arbiter clearly did not have jurisdiction over the
subject matter, his decision was void.
Article 260 of LC clarifies that such disputes involving the implementation of CBAs must be referred first
to the grievance machinery provided therein and, if unresolved within 7 days, they shall automatically
be referred to voluntary arbitration.
Under Article 261 of LC:
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 a Collective Bargaining Agreement shall mean flagrant
and/or malicious refusal to comply with the economic provisions of such agreement
TENG V. PAHAGAC November 17, 2010

FACTS: Albert Teng Fish Trading is engaged in deep sea fishing and, for this purpose, owns boats
(basnig), equipment, and other fishing paraphernalia. As owner of the business, Teng claims that he
customarily enters into joint venture agreements with master fishermen (maestros) who are skilled and
are experts in deep sea fishing; they take charge of the management of each fishing venture, including
the hiring of the members of its complement. He avers that the maestros hired the respondent workers
as checkers to determine the volume of the fish caught in every fishing voyage.
Respondents filed a complaint of illegal dismissal. They averred that there was no employment
contract, and sometime around Sept. 2002, Teng doubted the amounts that they were telling him
regarding how much fish were caught. By December, Teng told them their services were terminated.
The VA dismissed the complaint because there was no employer-employee relationship. They filed an
MR which was denied.
ISSUE: Whether or not the Voluntary arbitrator’s decision is not subject to a motion for reconsideration
HELD: Article 262-A deleted the word "unappealable"from Article 263. The deliberate selection of the
language in the amendatory act differing from that of the original act indicates that the legislature
intended a change in the law, and the court should endeavor to give effect to such intent. Presumably,
the decision may still be reconsidered by the Voluntary Arbitrator on the basis of a motion for
reconsideration duly filed during that period. The seasonable filing of a motion for reconsideration is a
mandatory requirement to forestall the finality of such decision.
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SAMAHAN NG MGA MANGAGAWA SA HYATT June 6, 2011
(SAMASAH-NUWHRAIN) V. MAGSALIN
FACTS: Caragdag, a waiter at the hotels Cafe Al Fresco restaurant, was dismissed due to the various
violations of the hotel’s rules and regulations. Caragdag’s dismissal was questioned by petitioner, and
the dispute was referred to voluntary arbitration upon agreement of the parties.
Voluntary Arbitrator: Dismissal of Caragdag is valid and reasonable.
Petitioner filed MR. VA denied MR.
Petitioner appealed the decision of the Voluntary Arbitrator before the CA in a petition for certiorari
under Rule 65. Petitioner argues that because decisions rendered by voluntary arbitrators are issued
under Title VII-A of the Labor Code, they are not covered by Rule 43 of the 1997 Rules of Civil Procedure,
as amended, by express provision of Section 2 thereof. Section 2, petitioner points out, expressly
provides that Rule 43 “shall not apply to judgments or final orders issued under the Labor Code of the
Philippines.”
ISSUE: Whether the decision of Voluntary Arbitrator is appealable to the CA via petition for certiorari
under Rule 65? NO.
HELD: NO. A decision or award of a voluntary arbitrator is appealable to the CA via petition for review
under Rule 43, in line with the procedure outlined in Revised Administrative Circular No. 1-95 (now
embodied in Rule 43 of the 1997 Rules of Civil Procedure), just like those of the quasi-judicial agencies,
boards and commissions enumerated therein, and consistent with the original purpose to provide a
uniform procedure for the appellate review of adjudications of all quasi-judicial entities.
Section 2, Rules 42 of the 1997 Rules of Civil Procedure, as presently worded, is nothing more but a
reiteration of the exception to the exclusive appellate jurisdiction of the Court of Appeals, as provided
for in Section 9, Batas Pambansa Blg. 129.
Note: Violations committed by Caragdag:
a) refused to follow the hotel policy on bag inspection and body frisking;
b) threatened and intimidate his superior while the latter was counseling his staff; and
c) leaving his work assignment without permission.
BARONDA V. CA October 14, 2015

FACTS: Petitioner is a mud press truck driver in Hideco Sugar Milling. He hit HIDECO’s transmission lines
while operating a dump truck, causing a factory-wide blackout which restoration had cost HIDECO.
HIDECO then served a notice of offense requiring him to issue an explanation within 3 days from notice.
After compliance, he was found guilty of negligence and the management recommended his dismissal.
The resident manager served his notice of termination effective at the close of officer hours that day.
The petitioner filed in the Office of the Voluntary Arbitrator of the NCMB a complaint for Illegal
Dismissal against HIDECO.
The VA held the dismissal illegal with an order for reinstatement, holding said separation from service
as a work suspension without pay and commanded him to pay the damages sustained by HIDECO from
the incident on installment basis. HIDECO’s MR was denied and HIDECO subsequently reinstated him.
ISSUE: W/N the reinstatement aspect of the VA’s decision was executory pending appeal. – YES
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HELD: The timely filing of an MR or of an Appeal forestalls the finality of the decision or award of the
VA but the reinstatement aspect of said decision remains executory regardless of the filing of such MR
or Appeal.
The reinstatement order of the VA should have the same authority, force and effect as that of the Labor
Arbiter, not only to encourage parties to settle their disputes through this mode, but to enforce the
constitutional mandate to protect labor, provide security of tenure and to enhance social justice.
NYK-FIL SHIP MANAGEMENT V. DABU September 13, 2017

FACTS: Dabu was an oiler in a vessel of NYK Fil-Ship. Because he suffers from diabetes mellitus even
before he commenced working, he was terminated from work when he was medically declared unfit
for sea employment.
He tried to file for a total impairment disability claim but this was rejected. He also attempted to enforce
the grievance machinery clause under the CBA but was also rejected.
The case was submitted to NCMB–Voluntary Arbitrator. He secured a favorable judgment.
NYK immediately filed a PetRev but did so beyond the 10-day period required under Art 276. NYK
invoked the 15-day period under Rule 43.
ISSUE: For decisions rendered by the voluntary arbitrator - which period should govern the appeal? 10
days as provided under the LC or 15 days as provided under Rule 43?
HELD: Within the 10-day period provided under the Labor Code. A Voluntary Arbitrator's award or
decision shall be appealed before the Court of Appeals within 10 days from receipt of the award or
decision. Should the aggrieved party choose to file a motion for reconsideration with the Voluntary
Arbitrator, the motion must be filed within the same 10-day period since a motion for reconsideration
is filed "within the period for taking an appeal”
Clearly, the decision of the voluntary arbitrator becomes final and executory after 10 days from receipt
thereof. The proper remedy to reverse or modify a voluntary arbitrators' or panel of voluntary
arbitrators' decision is to appeal the award or decision via a petition under Rule 43 of the 1997 Rules of
Civil Procedure. And under Section 4 of Rule 43, the period to appeal to the CA is 15 days from receipt
of the decision. Notwithstanding, since Article 262-A of the Labor Code expressly provides that the
award or decision of the voluntary arbitrator shall be final and executory after ten (10) calendar days
from receipt of the decision by the parties, the appeal of the VA decision to the CA must be filed within
10 days.
The period of appeal to govern the case must be the 10-day period under the Labor Code – it being a
substantive law, it cannot be amended by the 15-day period provided under Rule 43 of ROC.
GUAGUA NATIONAL COLLEGES V. CA August 28, 2018

FACTS: Under RA 6728 (Government Assistance to Students and Teachers in Private Education Act),
70% of the increase in tuition fees shall go to the payment of benefits of the personnel. Pursuant to this
provision, the petitioner imposed a 7% increase of its tuition fees, and in order to save the depleting
funds of the petitioner's Retirement Plan, its Board of Trustees approved the funding of the retirement
program out of the 70% net incremental proceeds arising from the tuition fee increases. Respondent
Unions challenged the petitioner's unilateral decision by claiming that the increase violated RA 6728.
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The parties referred the matter to voluntary arbitration. VA Bacungan rendered his decision in favor of
GNC. Respondents filed their petition for review. Subsequently, the petitioner filed its MTD, asserting
that the decision of the VA had already become final and executory pursuant to Article 276 of the
Labor Code. It was denied. Hence, the petitioner instituted its petition for certiorari.
The petitioner argues that the CA went beyond its jurisdiction when it denied the Motion to Dismiss
despite the finality of the decision of the Voluntary Arbitrator; that the CA was no longer authorized
to exercise its appellate jurisdiction; and that the CA misapplied the rule on equity. The petitioner
emphasizes the need to harmonize Rule 43 of the Rules of Court with Article 276 of the Labor Code in
view of their conflicting provisions on the period for the appeal from the decision of the Voluntary
Arbitrator. It maintains that unless Congress amends Article 276, the reglementary period within which
to appeal the decision or award of the Voluntary Arbitrator is 10 days instead of 15 days under Rule 43
of the Rules of Court. In contrast, the respondents insist that the remedy of appeal under Rule 43 of
the Rules of Court is applicable in challenging the decisions of the Voluntary Arbitrator.
ISSUE: W/N the CA gravely abused its discretion in denying the petitioner's MTD despite the finality of
the decision of the Voluntary Arbitrator. – NO
HELD: The CA could not be objectively held to be guilty of grave abuse of discretion in applying the
equitable rule on construction in favor of labor. By allowing a 10-day period, the obvious intent of
Congress in amending Article 263 to Article 262-A is to provide an opportunity for the party adversely
affected by the VA's decision to seek recourse via an MR or a petition for review filed with the CA.
Indeed, a motion for reconsideration is the more appropriate remedy in line with the doctrine of
exhaustion of administrative remedies. For this reason, an appeal from administrative agencies to
the CA via Rule 43 of the Rules of Court requires exhaustion of available remedies as a condition
precedent to a petition under that Rule.
Hence, the 10-day period stated in Article 276 should be understood as the period within which the
party adversely affected by the ruling of the Voluntary Arbitrators or Panel of Arbitrators may file an
MR. Only after the resolution of the motion for reconsideration may the aggrieved party appeal to the
CA by filing the petition for review under Rule 43 of the Rules of Court within 15 days from notice
pursuant to Section 4 of Rule 43.
OCTAVIO V. PLDT February 27, 2013

FACTS: PLDT and Gabay ng Unyon sa Telekominaksyon ng mga Superbisor (GUTS) entered into a CBA.
In 2000, PLDT hired Octavio as Sales System Analyst I. PLDT and GUTS entered into another CBA
covering (2002-2004). Octavio claimed that he was not given the salary increases of P2,500.00 effective
January 1, 2001 and P2,000.00 effective January 1, 2002. The Grievance Committee, however, failed to
reach an agreement. In effect, it denied Octavio’s demand for salary increases.
Octavio contends that PLDT and GUTS had the duty to strictly implement the CBA salary increases and
the Committee Resolution, which effectively resulted in the modification of the CBAs’ provision on
salary increases, is void. PLDT is bound to grant him the salary increase of P2,000.00 for the year 2002
on top of the merit increase given to him by reason of his promotion. It is his stance that merit increases
are distinct and separate from across-the-board salary increases provided for under the CBA.
ISSUE: W/N merit increases may be awarded simultaneously with increases given in the CBA?
HELD: Denial for his claims in salary increase did not violate Art 100 of the LC against diminution of
benefits. Even assuming there is diminution of benefits, Art 100 does not prohibit a union from offering
and agreeing to reduce wafes and benefits of the employees as the right to free collective bargaining
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includes the right to suspend it. Bargaining covers a process of finding a reasonable and acceptable
solution to stabilize labor management relations to promote stable industrial peace.
ARTS. 278-279 [263-264]. STRIKES AND LOCKOUTS

ABARIA V. NLRC December 7, 2011
FACTS: The National Federation of Labor (NFL) is the exclusive bargaining representative of the rank-
and-file employees of Metro Cebu Community Hospital, Inc. (MCCHI). NAMA-MCCH-NFL is NFL’s local
affiliate. NAMA-MCCH-NFL, through its President Perla Nava, wrote MCCHI Administrator expressing
its desire to renew the CBA. However, NFL informed MCCHI that the proposed CBA submitted by Nava
was never referred to NFL and that NFL has not authorized any other legal counsel or any person for
collective bargaining negotiations. Thus, MCCHI deferred any negotiations until the local union’s
dispute with the NFL is resolved.
ISSUE: WON NAMA-MCCH-NFL has the right to enter into CBA negotiations with MCCHI.
HELD: NO. NAMA-MCCH-NFL at the time of submission of said proposals was not a duly registered labor
organization, hence it cannot legally represent MCCHI’s rank-and-file employees for purposes of
collective bargaining. Hence, even assuming that NAMA-MCCH-NFL had validly disaffiliated from its
mother union, NFL, it still did not possess the legal personality to enter into CBA negotiations. A local
union which is not independently registered cannot, upon disaffiliation from the federation, exercise
the rights and privileges granted by law to legitimate labor organizations; thus, it cannot file a petition
for certification election.
YSS EMPLOYEES UNION V. YSS LABORATORIES INC. December 4, 2009

FACTS: YSS Laboratories implemented a retrenchment program which affected 11 employees. YSSEU
held a valid strike. Finding that the case is inimical to national interest, Secretary of LAbor certified the
case to to the NLRC for compulsory arbitration and issued two orders: directing all striking workers to
return to work and for the Company to accept them back under the same terms and conditions of
employment prior to strike; second, that the nine retrenched employees belonging to YSSEU be
included in the return to work order.
ISSUE: W/N the retrenched employees should be excluded from the coverage of return to work order.
– NO
HELD: Art. 263. Strikes, picketing, and lockouts.
(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 locked out 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.
NUWHRAIN-APL-IUF DUSIT HOTEL NIKKO CHAPTER November 11, 2008

V. CA
4F 2021-2022 18
FACTS: The Union is the certified bargaining agent of the regular rank-and-file employees of Dusit Hotel
Nikko (Hotel). The Union submitted its CBA negotiation proposals to the Hotel, but, the parties failed
to arrive at mutually acceptable terms and conditions. Due to the bargaining deadlock, the Union, filed
a Notice of Strike on the ground of the bargaining deadlock with the NCMB. The Union held a general
assembly at its office located in the Hotel's basement. Male Union members started sporting closely
cropped hair or cleanly shaven heads. The Hotel prevented these workers from entering the premises
claiming that they violated the Hotel's Grooming Standards. In view of the Hotel's action, the Union
staged a picket outside the Hotel premises. For this reason the Hotel experienced a severe lack of
manpower which forced them to temporarily cease operations in 3 restaurants. On January 20, 2002,
the Hotel issued notices to Union members, preventively suspending them. The Union filed with the
NCMB a second Notice of Strike on the ground of ULP and violation of Art. 248 (a) of the Labor Code on
illegal lockout. On January 26, 2002, the Hotel terminated the services of 29 Union officers and 61
members; and suspended 81 employees for 30 days, 48 employees for 15 days, 4 employees for 10
days, and 3 employees for five days. On the same day, the Union declared a strike. Starting that day,
the Union engaged in picketing the premises of the Hotel. During the picket, the Union officials and
members unlawfully blocked the ingress and egress of the Hotel premises. On January 31, 2002, the
Union filed its third Notice of Strike with the NCMB on the ground of ULP and union-busting.
ISSUE: Whether or not the union is guilty of illegal strike? – YES
HELD: YES. The Union is liable for conducting an illegal strike.
(1) The Union's violation of the Hotel's Grooming Standards was clearly a deliberate and concerted
action which forced the Hotel to choose between allowing its inappropriately hair styled employees to
continue working, to the detriment of its reputation, or to refuse them work, even if it had to cease
operations, which in either way would disrupt the operations of the Hotel. The appearances of
employees directly reflect the character and well-being of the Hotel, and being bald ohaving cropped
hair suggests that something is amiss.
(2) The Union's concerted action which disrupted the Hotel's operations clearly violated the CBA's "No
Strike, No Lockout" provision.
(3) The Union officers and members' concerted action violated the Union's duty and responsibility to
bargain in good faith. Under the IRR, it is prohibited to commit any act which will disrupt or impede the
early settlement of the labor disputes that are under conciliation. Since the bargaining deadlock is being
conciliated by the NCMB, the Union's action to have their officers and members' heads shaved was
manifestly calculated to antagonize and embarrass the Hotel management and in doing so effectively
disrupted the operations of the Hotel and violated their duty to bargain collectively in good faith.
(4) The Union failed to observe the mandatory 30-day cooling-off period and the seven-day strike ban
before it conducted the strike. The Union filed its Notice of Strike on the ground of bargaining deadlock
on December 20, 2001. The 30-day cooling-off period should have been until January 19, 2002. On top
of that, the strike vote was held on January 14, 2002 and was submitted to the NCMB only on January
18, 2002; therefore, the 7-day strike ban should have prevented them from holding a strike until
January 25, 2002.
(5) The Union committed illegal acts in the conduct of its strike. The Union officers and members formed
human barricades and obstructed the driveway of the Hotel. It can be seen that the guards and/or
police officers were just trying to secure the entrance to the Hotel. The pictures clearly demonstrate
the tense and highly explosive situation brought about by the strikers' presence in the Hotel's driveway.
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JACKBILT INDUSTRIES, INC. V. JACKBILT G.R. Nos. 171618-19; March 20, 2009
EMPLOYEES WORKERS UNION-NAFLU-KMU
FACTS: Due to economic crisis, Jackbuilt Industries decided to stop its business, compelling most of its
employees to go on leave for 6 months.
Jackbilt Employees Workers Union-NAFLU-KMU protested the temporary shutdown, claiming that the
stoppage of business was to avoid its duty to bargain collectively. The employees went on a strike. Its
officers and members picketed petitioner's main gates and deliberately prevented persons and vehicles
from going into and out of the compound.
For committing illegal acts during the strike, Jackbuilt Industries dismissed the officers and members.
ISSUE: W/N the filing of a petition with the labor arbiter to declare a strike illegal is a condition sine qua
non for the valid termination of employees who commit an illegal act in the course of such strike. - NO
HELD: Article 264(e) (now 279) of the Labor Code prohibits any person engaged in picketing from
obstructing the free ingress to and egress from the employer's premises. Since respondent was found
in the decision of the NLRC to have prevented the free entry into and exit of vehicles from petitioner's
compound, respondent's officers and employees clearly committed illegal acts in the course of the
strike. Pursuant to the principle of conclusiveness of judgment, the strike was ipso facto illegal. The
filing of a petition to declare the strike illegal was thus unnecessary.
APAP V. PAL June 6, 2011

FACTS: ALPAP filed a notice of strike against respondent PAL with the DOLE claiming that PAL
committed ULP. DOLE Secretary (SOLE) assumed jurisdiction over the labor dispute. SOLE ordered that
all strikes and lockouts at the PAL, whether actual or impending, are hereby strictly prohibited. The
parties are also enjoined from committing any act that may exacerbate the situation. However, ALPAP
went on strike.
DOLE issue a return-to-work order on June 7, 1998. However, it was only on June 26, 1998 when ALPAP
officers and members reported back to work and PAL refused to accept the returning pilots.
DOLE declared the strike illegal and pronounced the loss of employment status of its officers and
members who participated in the strike in defiance of the return-to-work order. This was eventually
elevated to the SC and attained finality on August 29, 2002. ALPAP then filed a motion to determine
who among its officers and members should be reinstated or deemed to have lost their employment
with PAL before DOLE. DOLE concludes that the case has indeed been resolved with finality by the
highest tribunal of the land, the SC. CA affirmed.
ISSUE: W/N the resolution of the DOLE has already taken up and resolved the issue of who among the
ALPAP members are deemed to have lost their employment status. – YES
HELD: The dispositive portion of the DOLE Resolution does not specifically enumerate the names of
those who actually participated in the strike but only mentions that those strikers who failed to heed
the return-to-work order are deemed to have lost their employment. This omission, however, cannot
prevent an effective execution of the decision. Any ambiguity may be clarified by reference primarily
to the body of the decision or supplementary to the pleadings previously filed in the case.
The SOLE declared the ALPAP officers and members to have lost their employment status based on
either of two grounds, viz: their participation in the illegal strike on June 5, 1998, or their defiance of
the return-to-work order of the SOLE. The records of the case unveil the names of each of these
returning pilots. The logbook with the heading Return To Work Compliance/Returnees bears their
4F 2021-2022 20
individual signature signifying their conformity that they were among those workers who returned to
work only on June 26, 1998 or after the deadline imposed by DOLE. Each of those pilots were bound by
the judgment.
OLISA ET. AL. V. ESCARIO ET. AL. G.R. No. 160302; September 27, 2010
FACTS: The petitioners were among the regular employees of respondent Pinakamasarap Corporation
(PINA), engaged in manufacturing and selling food seasoning. They were members of petitioner
Malayang Samahan ng mga Manggagawa sa Balanced Foods (Union).
All the officers and some 200 members of the Union walked out of PINA’s premises and proceeded to
the barangay office to show support for Cañete, an officer of the Union charged with oral defamation
by PINA’s personnel manager and Manor’s secretary. The proceedings in the barangay resulted in a
settlement and the officers and members of the Union all returned to work thereafter. As a result of
the walkout, PINA preventively suspended all officers of the Union. PINA terminated the officers of the
Union after a month. PINA then filed a complaint for unfair labor practice (ULP) and damages. The
Union filed a notice of strike, claiming that PINA was guilty of union busting through the constructive
dismissal of its officers. The Union held a strike vote, at which a majority of the Union voted to strike.
The strike was held. PINA retaliated by charging the petitioners with ULP and abandonment of work,
stating that they had violated provisions on strike of the collective bargaining agreement (CBA).
ISSUE: Whether or not petitioners are entitled to full backwages by virtue of their reinstatement and
Article 264 (now Article 279) of the Labor Code is not applicable to them. – NO
HELD: Contemplating two causes for the dismissal of an employee, that is: (a) unlawful lockout; and (b)
participation in an illegal strike, the third paragraph of Article 264(a) authorizes the award of full
backwages only when the termination of employment is a consequence of an unlawful lockout. On the
consequences of an illegal strike, the provision distinguishes between a union officer and a union
member participating in an illegal strike. A union officer who knowingly participates in an illegal strike
is deemed to have lost his employment status, but a union member who is merely instigated or induced
to participate in the illegal strike is more benignly treated. The petitioners were terminated for joining
a strike that was later declared to be illegal. The NLRC ordered their reinstatement or, in lieu of
reinstatement, the payment of their separation pay, because they were mere rank-and-file workers
whom the Union’s officers had misled into joining the illegal strike.
VISAYAS COMMUNITY MEDICAL CENTER V. YBALLE G.R. No. 196156; January 15, 2014
FACTS: Respondents were hired as staff nurses and midwives by petitioner VCMC, formerly MCCHI
which operates the Metro Cebu Community Hospital (MCCH). NFL is the exclusive bargaining
representatives of the rank-and-file employees of MCCH. Nava, president of NAMA-MCCH-NFL wrote
to MCCH Administrator, expressing the union’s desire to renew the CBA attaching the proposal.
However, MCCHI required Nava to secure first the endorsement of the legal counsel of NFL as the
official bargaining representative of MCCHI employees. Atty. Alforque informed MCCHI that the
proposed CBA submitted by Nava was never referred to NFL and that NFL has not authorized any other
person for CBA negotiations.
Atty. Alforque suspended the union membership of Nava. The next day, union members led by Nava
launched a series of mass actions such as wearing black and red armbands/headbands, marching
around the hospital premises and putting up placards, posters and streamers. Atty. Alforque
immediately disowned the concerted activities as they were not sanctioned by NFL.
4F 2021-2022 21
DOLE RO certified that NAMA-MCCH- NFL is not a registered labor organization. MCCHI then sent
individual notices to all union members asking them to submit a written explanation why they should
not be terminated for the illegal concerted activities of NAMA-MCCH-NFL. Nava group refused to
submit to investigation, so MCCH sent termination letter to union leaders and other members who
participated in the strike and picketing activities. Several complaints for illegal dismissal and unfair labor
practice were filed by the terminated employees against MCCHI.
LA dismissed the claim of ULP and illegal dismissal and declaring the termination of the respondents as
an offshoot of the illegal strike but directed the Hospital to pay the respondents their separation pay.
NLRC affirmed but deleted the award of separation pay. CA reversed and set aside NLRC’s decision.
ISSUE: W/N the respondents were illegally dismissed. – YES
HELD: The law makes a distinction between union members and union officers. A worker merely
participating in an illegal strike may not be terminated from employment. It is only when he commits
illegal acts during a strike that he may be declared to have lost employment status. In contrast, a union
officer may be terminated from employment for knowingly participating in an illegal strike or
participates in the commission of illegal acts during a strike.
CA found that respondents’ participation was limited to the wearing of armband and thus, declared
respondents’ termination as invalid in the absence of any evidence that they committed any illegal act
during the strike.
Considering that 15 years had lapsed from the onset of this labor dispute, and in view of strained
relations that ensued, in addition to the reality of replacements already hired by the hospital which had
apparently recovered from its huge losses, and with many of the petitioners either employed
elsewhere, already old and sickly, or otherwise incapacitated, separation pay without back wages is the
appropriate relief.
NOTES: With respect to backwages, the principle of a "fair day’s wage for a fair day’s labor" remains as
the basic factor in determining the award thereof. If there is no work performed by the employee there
can be no wage or pay unless the laborer was able, willing and ready to work but was illegally locked
out, suspended or dismissed or otherwise illegally prevented from working.
The alternative relief for union members who were dismissed for having participated in an illegal strike
is the payment of separation pay in lieu of reinstatement under the following circumstances:
1. When reinstatement can no longer be effected in view of the passage of a long period of time or
because of the realities of the situation;
2. Reinstatement is inimical to the employer’s interest;
3. Reinstatement is no longer feasible;
4. Reinstatement does not serve the best interests of the parties involved;
5. The employer is prejudiced by the workers’ continued employment;
6. Facts that make execution unjust or inequitable have supervened; or
7. Strained relations between the employer and employee.
TAVANGAO SHELL REFINERY EMPLOYEES April 7, 2014

ASSOCIATION V. PILIPINAS SHELL
FACTS: In anticipation of the expiration of the CBA between petitioner and respondent, the parties
started negotiations for a new CBA. The union proposed a 20% annual across-the-board basic salary
increase for the next 3 years. The company made a counter offer to grant the covered employees a
lump sum of P80,000 yearly for the 3yr period of the new CBA. The union asked the company to present
4F 2021-2022 22
it in full detail. They were not satisfied and asked further for justification. The company refused to
acknowledge any further justification. The union lowered its proposal to 12% salary increase. The
company increased its proposal to 88,000, the union again asked the company for justification.
Alleging failure on the part of the company to justify its offer, the union manifested taht the company
was bargaining in bad faith. On the 41st meeting, the company declared a bargaining deadlock and
sought the help of a third party. On the same day, the union filed a Notice of Strike. SaOle assumd
jurisdiction.
ISSUE: WON the company is bargaining in bad faith
HELD: No. The nature if duty to bargain does not compel any party to accept a proposal or to make any
concession. While the purpose of collective bargaining is the reaching of an agreement between the
employer and the employee’s union resulting in a binding contract between the parties, the failure to
reach an agreement after negotiations continued for a reasonable period does not mean lack of good
faith. The laws invite and contemplate a collective bargaining contract but do not compel one. For after
all, a CBA, like any contract is a product of mutual consent and not of compulsion. As such, the duty to
bargain does not include the obligation to reach an agreement. In this light, the corporation’s
unswerving position on the matter of annual lump sum payment in lieu of wage increase did not, by
itself, constitute bad faith even if such position caused a stalemate in the negotiations.
ASIA BREWERY INC. V. TPMA September 18, 2013

FACTS: Petitioner and respondent union had been negotiating for a new CBA for the years 2003-2006,
but after about 18 sessions or negotiations, the parties were still unable to reconcile their differences
on their respective positions on most items, particularly on wages and other economic benefits. Thus,
TPMA declared a deadlock, then later filed a notice of strike with NCMB. However, the parties did not
come to terms even before the NCMB. TPMA conducted a strike vote. Out of the 840 union members,
768 voted in favor of holding a strike. Petitioner thereafter petitioned the DOLE Secretary to assume
jurisdiction over the parties’ labor dispute, invoking Article 263 (g) of the Labor Code. In answer, TPMA
opposed the assumption of jurisdiction, reasoning therein that the business of petitioner is not
indispensable to the national interest. But DOLE Sec. issued an order assuming jurisdiction over the
labor dispute between the parties, then resolved the deadlock and granted arbitral awards. CA affirmed
with modification. CA remanded to DOLE Sec. with respect to the issue on salary increases for definite
resolution using as basis the externally audited financial statements to be submitted by the petitioner.
ISSUE: Whether the CA erred when it remanded to the Secretary of Labor the issue on wage increase.
HELD: NO. The remand of this case to the Secretary of Labor as to the issue of wage increase was proper.
In cases of compulsory arbitration before the Secretary of labor pursuant to Article 263(g) of the Labor
Code, the financial statements of the employer must be properly audited by an external and
independent auditor in order to be admissible in evidence for purposes of determining the proper wage
award. Thus, the Secretary of Labor gravely abused her discretion when she relied on the unaudited
financial statements of petitioner corporation in determining the wage award because such evidence
is self-serving and inadmissible. Not only did this violate the December 19, 2003 Order of the Secretary
of Labor herself to petitioner corporation to submit its complete audited financial statements, but this
may have resulted to a wage award that is based on an inaccurate and biased picture of petitioner
corporation's capacity to pay — one of the more significant factors in making a wage award. Petitioner
corporation has offered no reason why it failed and/or refused to submit its audited financial
statements for the past five years relevant to this case. This only further casts doubt as to the veracity
and accuracy of the unaudited financial statements.
4F 2021-2022 23
DO 40-G-3 SERIES OF 2010
DO 40-H-3 SERIES OF 2013
OPERATION GUIDELINES OF DO 40-G-3 SERIES OF 2010
ESCARIO ET. AL. V NLRC 2010 case (Article 264 in rel to 279)
FACTS: Respondents were hired as staff nurses and midwives by petitioner VCMC. Nava wrote Rev. Iyoy
desiring to renew CBA, and requested that ees be allowed to avail of 1-day union leave with pay. Atty
Alforque informed MCCHI (hospital company) that the proposed CBA submitted by Nava was never
referred to NFL and the latter has not authorized any other legal counsel for collective bargaining
negotiations. MCCHI attempted to take over the room being used as union office but was prevented to
do so by Nava and her group who protested. In letter addressed to Nava and her group, Atty Alforque
suspended their union membership for serious violation of the Consti-bylaws.
The next day, several union members led by Nava and her group launched series of mass actions such
as wearing black and red armbands/headbands, marching around the hospital premises and putting up
placards, posters and streamers. Atty Alfrque immediately disowned the concerted activities being
carried out by union wc are not sanctioned by NFL. Nava denied that there was temporary stoppage of
work. DOLE said that there is nothing in their records which shows that NAMA-MCCH-NFL is a registered
labor organization. MCCHI then sent individual notices to union members asking them to submit
explanation why they should not be terminated. MCCHI sent termination letters to union leaders and
MEMBERS who participated in the strike and picketing activities.
ISSUE: won the termination of union members was proper?
HELD: NO. Art. 279(a) of LC “any union OFFICER who participates in illegal strike and any WORKER or
union OFFICER who participates in commission of illegal acts during strike may be declared to have lost
his employment status”. there is a distinction between union MEMBERS and union OFFICERS. A worker
merely participating in illegal strike may NOT be terminated from employment. It is only when he
commits illegal acts during a strike that he may be declared to have lost his employment status. on the
other hand, a union OFFICER may be terminated from employment when he PARTICIPATES in an illegal
strike or particiapates in commission of illegal acts during a strike. Since an ordinary striking worker
cannot be dismissed for mere participation in illegal strike, CA correctly ruled that they were illegally
dismissed.
UNIVERSITY OF SAN AUGUSTIN EMPLOYEES UNION 2006 case

V. CA
FACTS: The parties entered into a 5-year CBA which, among other things, provided that the economic
provisions thereof shall have a period of three (3) years or up to 2003.
Pursuant to the CBA, the parties commenced negotiations for the economic provisions for the
remaining two years, i.e., SY 2003-2004 and SY 2004-2005. During the negotiations, the parties could
not agree on the manner of computing the TIP, thus the need to undergo preventive mediation
proceedings before the National Conciliation and Mediation Board (NCMB), Iloilo City. The impasse
respecting the computation of TIP was not resolved. This development prompted the Union to declare
a bargaining deadlock grounded on the parties' failure to arrive at a mutually acceptable position on
the manner of computing the seventy percent (70%) of the net TIP to be allotted for salary and other
benefits.
4F 2021-2022 24
Thereafter, the Union filed a Notice of Strike before the NCMB which was expectedly opposed by the
University in a Motion to Strike Out Notice of Strike and to Refer the Dispute to Voluntary Arbitration.
the Union staged a strike. At 6:45 a.m. of the same day, Sheriffs Francisco L. Reyes and Rocky M.
Francisco had arrived at San Agustin University to serve the AJO on the Union. The Union’s Vice
President refused to receive the AJO.
ISSUE: Whether or not the strike staged by the employees is illegal when they failed to immediately
return to their work when the Assumption of Jurisdiction Order was deemed served upon them.
HELD: The September 16, 2003 Union's Board Resolution No. 3 which gave sole authority to its
president to receive the AJO must not be allowed to circumvent the standard operating procedure of
the Office of the Undersecretary for Labor Relations which considers AJOs as duly served upon posting
of copies thereof on designated places. The procedure was adopted in order to prevent the thwarting
of AJOs by the simple expedient of refusal of the parties to receive the same, as in this case.
Conclusively, when the SOLE assumes jurisdiction over a labor dispute in an industry indispensable to
national interest or certifies the same to the NLRC for compulsory arbitration, such assumption or
certification shall have the effect of automatically enjoining the intended or impending strike or
lockout. Moreover, if one had already taken place, all striking workers 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.
In this case, the AJO was served at 8:45 a.m. of September 19, 2003. The strikers then should have
returned to work immediately. However, they persisted with their refusal to receive the AJO and waited
for their union president to receive the same at 5:25 p.m.
PHIL DIAMOND HOTEL AND RESORT INC. V. 494 SCRA 336

MANILA DIAMOND HOTEL EMPLOYEES UNION
FACTS:
Respondent union, filed a Petition for Certification Election before the DOLE (NCR) seeking certification
as the exclusive bargaining representative of its members. The DOLE-NCR denied the petition as it failed
to comply with legal requirements and was seen to fragment the employees of the petitioner.
The union later notified the petitioner of its intention to negotiate a Collective Bargaining Agreement
(CBA) for its members. The hotel replied that since it was not certified by the DOLE as the exclusive
bargaining agent, it could not be recognized as such.
On the ground that the employer refused to bargain collectively, the union staged a strike. The strikers
obstructed the free ingress and egress from the hotel. The strikers refused to dismantle the tents they
put up at the employees entrance of the hotel prompting the hotel guards to dismantle the same, in
which the said guards suffered injuries as they were hit by rocks coming from the direction of the
strikers The NLRC declared the strike as illegal and union officers and members are deemed to have
lost their employment status. It also dismissed the supervisory employees who participated in the
strike.
ISSUE:
1. Whether or not the strike was legal. – YES
2. Whether or not the officers and employee members should be dismissed.
4F 2021-2022 25
HELD: Only the labor organization designated or selected by the majority of the employees in an
appropriate collective bargaining unit is the exclusive representative of the employees in such unit for
the purpose of collective bargaining. The union is admittedly not the exclusive representative of the
majority of the employees of petitioner, hence, it could not demand from petitioner the right to bargain
collectively on their behalf.
Even if the purpose of a strike is valid, the strike may still be held illegal where the means employed are
illegal. Thus, the employment of violence, intimidation, restraint or coercion in carrying out concerted
activities which are injurious to the rights to property renders a strike illegal. And so is picketing or the
obstruction to the free use of property or the comfortable enjoyment of life or property, when
accompanied by intimidation, threats, violence, and coercion as to constitute nuisance.
Only union officers, and those members who have participated in the illegal acts should be deemed
dismissed from their employment.
The union officers should be dismissed for staging and participating in the illegal strike, following
paragraph 3, Article 264(a) of the Labor Code which provides that . . .[a]ny union officer who knowingly
participates in an illegal strike and any worker or union officer who knowingly participates in the
commission of illegal acts during strike may be declared to have lost his employment status . . . An
ordinary striking worker cannot, thus, be dismissed for mere participation in an illegal strike. There
must be proof that he committed illegal acts during a strike, unlike a union officer who may be
dismissed by mere knowingly participating in an illegal strike and/or committing an illegal act during a
strike.
SOLIDBANK V. GAMIER November 15, 2010

FACTS: Employees of Solidbank staged a series of mass actions. The SOLE then took cognizance of the
labor dispute and ordered a Cease and Desist Order.
Out of 712 employees who took part in the boycott, 513 returned to work and were accepted by the
bank. The remaining 199 employees insisted on defying Solidbank and were later on terminated from
their employment.
ISSUE: WON the dismissal of the union members was illegal?
HELD: The Court held that the law makes a distinction between union officers and union members. For
knowingly participating in an illegal strike or participating in the commission of illegal acts during a
strike, the law provides that a union officer may be terminated from employment. The law grants the
employer the option of declaring a union officer who participated in an illegal strike as having lost his
employment.
However, a worker merely participating in an illegal strike may not be terminated from employment. It
is only when he commits illegal acts during a strike that he may be declared to have lost his
employment. Hence, with respect to respondents who are union officers, the validity of their
termination cannot be questioned.
For the rest of respondents who are union members, the rule is that an ordinary striking worker cannot
be terminated for mere participation in an illegal strike. There must be proof that he or she committed
illegal acts during a strike.
C ALCANTARA & SONS V. CA September 29, 2010 and March 2012
4F 2021-2022 26
FACTS: The Company and the Union entered into a Collective Bargaining Agreement (CBA) that bound
them to hold no strike and no lockout in the course of its life. At some point the parties began
negotiating the economic provisions of their CBA but this ended in a deadlock, prompting the Union to
file a notice of strike. After efforts at conciliation by the Department of Labor and Employment (DOLE)
failed, the Union conducted a strike vote that resulted in an overwhelming majority of its members
favoring it. The Union reported the strike vote to the DOLE and, after the observance of the mandatory
cooling-off period, went on strike.
ISSUE:
1. WoN the Union staged an illegal strike. – YES
2. WoN impleaded Union members committed illegal acts during the strike, justifying their
termination from employment. – YES
HELD:
1. A strike may be regarded as invalid although the labor union has complied with the strict
requirements for staging one as provided in Article 263 of the Labor Code when the same is held
contrary to an existing agreement, such as a no strike clause or conclusive arbitration clause. Here,
the CBA between the parties contained a "no strike, no lockout" provision that enjoined both the
Union and the Company from resorting to the use of economic weapons available to them under
the law and to instead take recourse to voluntary arbitration in settling their disputes.
No law or public policy prohibits the Union and the Company from mutually waiving the strike and
lockout maces available to them to give way to voluntary arbitration. Indeed, no less than the 1987
Constitution recognizes in Section 3, Article XIII, preferential use of voluntary means to settle disputes.
2. Since the Union's strike has been declared illegal, the Union officers can, in accordance with law be
terminated from employment for their actions. This includes the shop stewards. They cannot be
shielded from the coverage of Article 264 of the Labor Code since the Union appointed them as
such and placed them in positions of leadership and power over the men in their respective work
units.
As regards the rank and file Union members, Article 264 of the Labor Code provides that termination
from employment is not warranted by the mere fact that a union member has taken part in an illegal
strike. It must be shown that such a union member, clearly identified, performed an illegal act or acts
during the strike
SUKHOTHAI CUISINE AND RESTAURANT V. CA 495 SCRA 336

FACTS: Respondent union filed a notice of strike with the NCMB on the ground of ULP. During the
conciliation conference, the representatives of the petitioner agreed that there will be no termination
of the services of private respondents during the pendency of the case, but they reserved the right to
issue memos to erring employees for violation of company policies. Both parties agreed to submit the
matter for voluntary arbitration in order to prevent a strike.
During the pendency of the voluntary arbitration proceedings, the petitioner dismissed two union
members. Private respondents protested these dismissals and staged a wildcat strike.
Petitioner filed a complaint for illegal strike with the NLRC against private respondents seeking to
declare the strike illegal, and to declare the respondents who participated in the commission of illegal
acts to be validly dismissed from employment. The LA ruled that the strike was illegal for failure to
comply with the mandatory requisites of a lawful strike.
4F 2021-2022 27
ISSUE: WON the strike was legal. – NO
HELD: NO. At the time the strike was staged, a voluntary arbitration between the parties was already
ongoing, wherein the issues to be resolved include the very same issues included in the Notice of Strike
which was first filed by private respondent union. The SC has held that strikes staged in violation of
agreements providing for arbitration are illegal, since these agreements must be strictly adhered to and
respected if their ends are to be achieved.
The alleged dismissals of the two union members, which allegedly triggered the wildcat strike, are not
sufficient grounds to justify the same. Since the private respondents were fully aware that the
arbitration proceedings were pending, good faith cannot be invoked as a defense.
BIFLEX PHILS. INC. LABOR UNIONS V. FILFLEX 511 SCRA 247

INDUSTRIAL MANUFACTURING CORPORATION
FACTS: Petitioner Biflex and Filfex union are the respective CBAgents of the employees of the sister
companies Biflex and Filfex. Both of the companies were situated in a big compound both of which
shares one common entrance. Later on, the labor sector conducted a welga ng bayan; the unions stages
a work stoppage which lasted for several days, prompting the companies to file a petition to declare
the work stoppage illegal for failure to comply with procedural requirements. They further alleged that,
Biflex Union blocked the egress and ingress of the company premises. consequently, a number of
employees who attended the strike were dismissed from service.
ISSUE: WON there was an illegal strike. – YES
HELD: Yes, there was an illegal strike. Art. 264 provides that the blocking of the egress and ingress of
the company premises shall be in violation of Art. 264 which in turn makes the strike in question illegal.
Article 264 (a) of the Labor Code states that any union officer who knowingly participates in an illegal
strike and any worker or union who knowingly participates in the commission of illegal acts during a
strike may be declared to have lost his employment status.
Thus, a union officer may be declared to have lost his employment status if he knowingly participates
in an illegal strike and in this case, the strike is declared illegal by the court because the means employed
by the union are illegal.
Here, the unions blocked the egress and ingress of the company premises thus, a violation of Article
264 (e) of the Labor Code which would affect the strike as illegal even if assuming arguendo that the
unions had complied with legal formalities and thus, the termination of the employees was valid.
The court said that the legality of a strike is determined not only by compliance with its legal formalities
but also by means by which it is carried out.
STA. ROSA COCA COLA PLANT EMPLOYEE’S UNION 512 SCRA 437
V. COCA-COLA BOTTLERS PHILS. INC.
FACTS: Petitioner Union is the sole and exclusive bargaining representative of the regular daily paid
workers and the monthly paid non -commission earning employees of the respondent Company. The
individual petitioners are Union officers, directors, and shop stewards.
The Union then filed an Amended Notice of Strike on Sept. 17, 1999 on the ff. grounds:
a. ULP for the company’s refusal to bargain in good faith; and
b. interference with the exercise of their right to self-organization.
4F 2021-2022 28
On Sept. 15, 1999, the Union decided to participate in a mass action organized by the Alyansa ng mga
Unyon sa Coca-Cola in front of the Company’s premises set for Sept. 21, 1999.
The Company filed a “petition to declare strike illegal” on the ground that the petitioners staged a strike
at the premises of the Company without observing the requirements mandated by law. Moreover,
because of the slowdown in the work, the Company suffered losses.
ISSUE:
1. Whether the Sept. 21, 1999 mass action staged by the Union was a strike. – YES
2. If in the affirmative, whether it was legal
HELD:
1. The term “strike” encompasses not only concerted work stoppages, but also slowdowns, mass
leaves, sit-downs, attempts to damage, destroy or sabotage plant equipment and facilities, and
similar activities.
Petitioners notified the respondent of their intention to stage a strike, and not merely to picket.
Petitioners’ insistence to stage a strike is evident in the fact that an amended notice to strike was filed
even as respondent moved to dismiss the first notice.
2. No. For a strike to be valid, the ff. procedural requisites provided by the Labor Code must be
observed:
• A notice of strike filed with the DOLE 30 days before the intended date thereof, or 15 days in case of
ULP;
• Strike vote approved by a majority of the total union membership in the bargaining unit concerned
obtained by secret ballot in a meeting called for that purpose;
• Notice given to the DOLE of the results of the voting at least 7 days before the intended strike.
These requirements are mandatory and the failure of a union to comply therewith renders strike illegal.
It is clear in this case that petitioners totally ignored the statutory requirements and embarked on their
illegal strike.
MANILA HOTEL EMPLOYEE’ ASSOCIATION V. 517 SCRA 349

MANILA HOTEL CORPORATION
FACTS: Manila Hotel Employees Association (MHEA) filed a Notice of Strike with the NCMB against
Manila Hotel on the grounds of unfair labor practices. The Secretary of Labor and Employment (SOLE)
certified the labor dispute to the NLRC for compulsory arbitration pursuant to Article 263(g) of the
Labor Code. Specifically, the Order enjoined any strike or lockout and the parties were ordered to cease
and desist from committing any acts that may exacerbate the situation. MHEA conducted a strike
despite the clear terms of the Order issued by the SOLE.
The NLRC issued an Order directing the striking workers to return to work immediately and the hotel
to accept them back under the same terms and conditions of employment. NLRC received Compliance
filed by Manila Hotel manifesting that only six striking employees complied with the return-to-work
Order and were reinstated. The other striking employees had openly defied the said Order.
Petitioner: argues that the MR they field questioning the validity of the assumption of JD of SOLE has
prevented the Order of the SOLE from becoming final and executory.
ISSUE: Whether the Motion for Reconsideration filed by petitioner questioning the validity of the
assumption of JD of SOLE has prevented the Order of the SOLE from becoming final and executory? NO.
4F 2021-2022 29
HELD: NO. A return-to-work order is immediately executory notwithstanding the filing of a motion
for reconsideration. The assumption of jurisdiction by the SOLE 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. This extraordinary authority given to the Secretary of Labor is aimed at arriving at a
peaceful and speedy solution to labor disputes, without jeopardizing national interests.
Thus, the return-to-work order must be strictly complied with even during the pendency of any petition
questioning its validity. Returning to work in this situation is not a matter of option or voluntariness but
of obligation. The worker must return to his job together with his co-workers so the operations of the
company can be resumed and it can continue serving the public and promoting its interest.
MHEA claims that the Court should consider as a mitigating circumstance the fact that they held the
strike 3 months after filing their notice of strike. Such detail is irrelevant. What is crucial is that they
were apprised of the assumption order of the SOLE wherein they were enjoined from carrying out a
strike.
NOTE: Reason for assumption of JD by SOLE - The Hotel
a) serves as venue for local and international conventions and conferences;
b) provides employment to more than 700 employees;
c) substantial contribution to the government coffers in the form of foreign exchange earnings
and tax payments.
Undoubtedly, a work stoppage thereat will adversely affect the Hotel, its employees, the industry, and
the economy as a whole.
G&S TRANSPORT CORPORATION V. INFANTE 533 SCRA 289

FACTS: Petitioner was the exclusive coupon taxi concessionaire at the NAIA for 5 years. Under such
contract the taxi units were given a garage located at the Duty Free compound just opposite NAIA.
NAIA sent a letter to the NAIA Service Taxi Employees Union (Union) demanding the dismissal from
employment Gonzales and Alzaga (both drivers of petitioner). Petitioner terminated said drivers.
Several drivers to stop driving their taxis to sympathize with their dismissed colleagues. Petitioner
claims that this brought stoppage to its business operation and is an illegal strike. Petitioner filed an
action for illegal strike. The day after the strike, they were refused entry by the guard. The 37 drivers
filed an illegal dismissal case but most of them filed their affidavits of desistance.
According to Infante and Borbo, they reported to work but found no taxis in their garage and found out
that on that same day the protest to sympathize with their colleagues ensued. The day after the protest
they did not report back to work, as it was their day-off. According to Castañeda, he was on a sick leave.
When he reported back to work, the strike occurred.
LA held that there is an illegal strike. Drivers undertook those collective actions without first filing a
notice to strike and taking a strike vote, and in violation of the no strike – no lock out clause in the CBA.
LA found respondents participated in the illegal strike but did not affirm their dismissal. LA ordered that
separation pay be given in lieu of reinstatement but without backwages. NLRC affirmed.
ISSUE:
1. W/N there was an illegal strike. – YES
2. W/N the order for the payment of separation pay in lieu of reinstatement without backwages was
proper. – YES
4F 2021-2022 30
HELD:
1. The strike undertaken by respondents took the form of a sit-down strike or sympathetic strike,
where the striking employees have no demands or grievances of their own, but they strike for the
purpose of directly or indirectly aiding others, without direct relation to the advancement of the
interest of the strikers. As adverted to earlier, no matter by what term the respondents
complainants used in describing their concerted action, i.e., protest, sympathy or mere expression,
their joint action have successfully paralyzed the operations of G & S Transport, and this is
considered a strike.
It can now therefore be concluded that the acts of respondents do not merit their dismissal from
employment because it has not been substantially proven that they committed any illegal act while
participating in the illegal strike.
2. With respect to backwages, if there is no work performed by the employee there can be no wage
or pay unless the laborer was able, willing and ready to work but was illegally locked out, suspended
or dismissed or otherwise illegally prevented from working. For this exception to apply, it is
required that the strike be legal, a situation that does not obtain in the case at bar. Under the
circumstances, respondents’ reinstatement without backwages suffices for the appropriate relief.
If reinstatement is no longer possible, given the lapse of considerable time (17 years since illegal
dismissal) from the occurrence of the strike, the award of separation pay of 1 month salary for each
year of service, in lieu of reinstatement, is in order.
NOTES: Article 264 of the Labor Code, in providing for the consequences of an illegal strike, makes a
distinction between union officers and members who participated therein. Thus, knowingly
participating in an illegal strike is a valid ground for termination of employment of a union officer. For
union members, there must be proof that he committed illegal acts during the strike and the striker
who participated in the commission of illegal act must be identified. Substantial evidence available
under the attendant circumstances, which may justify the imposition of the penalty of dismissal, may
suffice.
STEEL CORPORATION OF THE PHILS. V. SCP 551 SCRA 595

EMPLOYEES UNION NATIONAL FEDERATION OF
LABOR UNIONS
FACTS: This case involves an issue with the exclusive bargaining agent of SCP, a company engaged in
manufacturing construction materials.
In a certification election, FUEL-GAS appeared to have won against “no union” option but this election
was declared a failure because less than majority of the rank-and-file employees cast their votes. During
this election, SCPEU was not able to participate since their motion to participate was denied for having
been filed out of time.
Another election was then conducted at the instance of SCPEU (through its mother federation, NAFLU)
despite a pending appeal by FUEL-GAS. Both unions, though, were able to participate this time, and
SCPEU won.
FUEL-GAS and employer SCP questioned the validity of the 2nd election, contending that the 1st
election bars the conduct of a further election.
4F 2021-2022 31
Meanwhile, SCPEU has been declared a winner and started submitting CBA proposals to employer SCP.
However, the employer refused to act on it for the meantime, pending the issues relating to the
elections.
Several notices of strike were filed by SCPEU on separate occasions, all based on the ground of SCP’s
ULP for failure to bargain and for failure to recognize SCPEU as the SEBA of the rank-and-file employees.
The labor dispute has been certified for compulsory arbitration. The SOLE issued a return to work order.
Despite such, SCPEU members and officers proceeded to stage their strike. Petitioner SCP then decided
to terminate the employment of all union officers who participated in the strike.
ISSUE:
1. WON the strike conducted was lawful.
2. WON the union officers were validly terminated by mere staging of the strike.
HELD:
1. NO. The strike undertaken by the officers of respondent union is patently illegal for the following
reasons: (1) it is a union-recognition-strike which is not sanctioned by labor laws; (2) it was
undertaken after the dispute had been certified for compulsory arbitration; and (3) it was in
violation of the Secretary's return-to-work order.
The certification election that was conducted where respondent emerged as winner, not having been
recognized as valid, it has no authority to represent the rank-and-file employees of petitioner. Thus, it
could not ask the petitioner to bargain with it.
Even if this Court were to uphold the validity of respondent’s purpose or objective in staging a strike,
still, the strike would be declared illegal for having been conducted in utter defiance of the Secretary’s
return-to-work order and after the dispute had been certified for compulsory arbitration.
RULE RE SOLE’s RETURN-TO-WORK ORDER:
The moment the Secretary of Labor assumes jurisdiction over a labor dispute in an industry
indispensable to national interest, such assumption shall have the effect of automatically enjoining the
intended or impending strike. It was not even necessary for the Secretary of Labor to issue another
order directing a return to work. The mere issuance of an assumption order by the Secretary of Labor
automatically carries with it a return-to-work order, even if the directive to return to work is not
expressly stated in the assumption order.
Returning to work in this situation is not a matter of option or voluntariness but of obligation. The
worker must return to his job together with his co-workers so that the operations of the company can
be resumed and it can continue serving the public and promoting its interest.
2. TERMINATION OF EMPLOYMENT OF UNION OFFICERS;
RULE: EMPLOYEE-MEMBER vs EMPLOYEE-OFFICER PARTICIPATING IN AN ILLEGAL STRIKE:
The law makes a distinction between union members and union officers.
● A worker merely participating in an illegal strike may not be terminated from employment. It is only
when he commits illegal acts during a strike that he may be declared to have lost employment
status.
● For knowingly participating in an illegal strike or participating in the commission of illegal acts
during a strike, the law provides that a union officer may be terminated from employment. The law
grants the employer the option of declaring a union officer who participated in an illegal strike as
having lost his employment. It possesses the right and prerogative to terminate the union officers
4F 2021-2022 32
from service. Otherwise, the workers will simply refuse to return to their work and cause a standstill
in the company operations while retaining the positions they refuse to discharge and preventing
management from filling up their positions.
CHRIS GARMENTS CASE January 2009

FACTS:
Respondent Union filed a petition for certification election with the Med-Arbiter. The union sought to
represent petitioner's rank-and-file employees not covered by its CBA with SMCGC-SUPER, the certified
bargaining agent of the rank-and-file employees. The union alleged that it is a legitimate labor
organization. Petitioner moved to dismiss the petition. It argued that it has an existing CBA with
SMCGC-SUPER which bars any petition for certification election prior to the 60-day freedom period.
The union contended that the contract bar rule does not apply.
The Med-Arbiter dismissed the petition, ruling that even if the union members are considered direct
employees of petitioner, the petition for certification election will still fail due to the contract bar
rule under Article 232 of the Labor Code. Hence, a petition could only be filed during the 60-day
freedom period of the CBA or from May 1, 2004 to June 30, 2004. The Secretary of Labor and
Employment affirmed the decision of the Med-Arbiter.
Incidentally, a certification election was conducted on June 21, 2005 among petitioner's rank-and-file
employees where SMCGC-SUPER emerged as the winning union. On January 20, 2006, the Med-Arbiter
certified SMCGC-SUPER as the sole and exclusive bargaining agent of all the rank-and-file employees of
petitioner.
ISSUE: W/N the case is barred by res judicata or conclusiveness of judgment
HELD: NO
The Secretary of Labor and Employment dismissed the first petition as it was filed outside the 60-day
freedom period. At that time therefore, the union has no cause of action since they are not yet legally
allowed to challenge openly and formally the status of SMCGC-SUPER as the exclusive bargaining
representative of the bargaining unit. Such dismissal, however, has no bearing in the instant case since
the third petition for certification election was filed well within the 60-day freedom period. Otherwise
stated, there is no identity of causes of action to speak of since in the first petition, the union has no
cause of action while in the third, a cause of action already exists for the union as they are now legally
allowed to challenge the status of SMCGC-SUPER as exclusive bargaining representative.
UNIVERSITY OF IMMACULATE CONCEPCION V. SEC September 14, 2006

OF LABOR
FACTS: The UNION it filed a notice of strike on the grounds of bargaining deadlock and ULP. During the
thirty (30) day cooling-off period, two union members were dismissed by petitioner. Consequently, the
UNION went on strike.
On January 23, 1995, the then Secretary of Labor, Ma. Nieves R. Confessor, issued an Order assuming
jurisdiction over the labor dispute.
On March 10, 1995, the UNION filed another notice of strike, this time citing as a reason the
UNIVERSITY’s termination of the individual respondents. The UNION alleged that the UNIVERSITY’s act
of terminating the individual respondents is in violation of the Order of the Secretary of Labor.
4F 2021-2022 33
On March 28, 1995, the Secretary of Labor issued another Order reiterating the directives contained in
the January 23, 1995 Order. Hence, the UNIVERSITY was directed to reinstate the individual
respondents under the same terms and conditions prevailing prior to the labor dispute.
The UNIVERSITY filed a MR. In the Order dated August 18, 1995, then Acting Secretary Jose S. Brilliantes
denied the MR, but modified the two previous Orders by adding that Anent the Union’s Motion, we
find that superseding circumstances would not warrant the physical reinstatement of the twelve (12)
terminated employees.
Hence, they are hereby ordered placed under payroll reinstatement until thevalidity of their
termination is finally resolved.
ISSUE: WON payroll reinstatement, instead of actual reinstatement, is proper?
HELD: With respect to the Secretary’s Order allowing payroll reinstatement instead of actual
reinstatement for the individual respondents herein, an amendment to the previous Orders issued by
her office, the same is usually not allowed. Article 263(g) of the Labor Code aforementioned states that
all workers must immediately return to work and all employers must readmit all of them under the
same terms and conditions prevailing before the strike or lockout. The phrase “under the same terms
and conditions” makes it clear that the norm is actual reinstatement. This is consistent with the idea
that any work stoppage or slowdown in that particular industry can be detrimental to the national
interest.
In ordering payroll reinstatement in lieu of actual reinstatement, then Acting Secretary of Labor Jose S.
Brillantes said:
Anent the Union’s Motion, we find that superseding circumstances would not warrant the physical
reinstatement of the twelve (12) terminated employees. Hence, they are hereby ordered placed under
payroll reinstatement until the validity of their termination is finally resolved.
RAMIREZ V. POLYSON INDUSTRIES October 19, 2016

FACTS: Five (5) operators indicated their desire to work overtime. However, after their regular shift,
three of them did not work overtime which resulted in the delay in delivery of the client's order and
eventually resulted in the cancellation of the said order. Upon investigation and hearing conducted by
the management, it was discovered that petitioners were the ones who pressured him to desist from
rendering overtime work.
ISSUE: WON petitioners are guilty of illegal concerted activity.
HELD: YES. Petitioners are guilty of instigating their co-employees to commit slowdown, an inherently
and essentially illegal activity even in the absence of a no-strike clause in a collective bargaining
contract, or statute or rule. Nothing in the law requires that a slowdown be carefully planned and that
it be participated in by a large number of workers. The essence of this kind of strike is that the workers
do not quit their work but simply reduce the rate of work in order to restrict the output or delay the
production of the employer.
BIGG’S V. BONCACAS March 6, 2019

FACTS: Bigg’s alleges that on Feb 16, 1996, around 50 union members staged an illegal sit-down strike.
The union did not comply with the requirements of sending a notice of strike to the NCMB and did not
obtain the strike vote from its members. The union allegedly filed the notice of strike on the same day
4F 2021-2022 34
of the strike. Biig’s issued a memo requiring them to explain but they did not comply with the order so
the employees were sent termination letters. Bigg’s further alleges that during the strike on March 5,
1996, the union members were disruptive and violent as they prevented ingress and egress of
employees and customers from company premises.
ISSUE:
1. WON the strikes held on Feb and March were illegal
2. WON the union officers and employees were validly dismissed
HELD:
1. Yes, the both strikes were illegal. In a strike grounded on unfair labor practice, the following are the
requirements: (1) the strike may be declared by the duly certified bargaining agent or legitimate
labor organization; (2) the conduct of the strike vote in accordance with the notice and
reportorial requirements to the NCMB and subject to the seven-day waiting period; (3) notice of
strike filed with the NCMB and copy furnished to the employer, subject to the 15-day cooling-off
period. In cases of union busting, the 15-day cooling-off period shall not apply.
In both instances, the union must conduct a "strike vote" which requires that the actual strike is
approved by majority of the total union membership in the bargaining unit concerned. The union is
required to notify the regional branch of the NCMB of the conduct of the strike vote at least 24 hours
before the conduct of the voting. Thereafter, the union must furnish the NCMB with the results of the
voting at least seven days before the intended strike or lockout. This seven-day period has been
referred to as the "seven-day strike ban" or "seven-day waiting period.
Here, the union failed to prove that there was union busting to exempt compliance with the cooling-
off period.
2. Boncacas and the other union officers’ dismissal was valid. However, the union members who did
not participate in any prohibited act during the strikes, their dismissal was invalid.
Article 279 provides that any union officer who knowingly participates in an illegal strike and any
worker or union officer who knowingly participates in the commission of illegal acts during a strike
may be declared to have lost his employment status: Provided, That mere participation of a worker
in a lawful strike shall not constitute sufficient ground for termination of his employment, even if a
replacement had been hired by the employer during such lawful strike.
For union members, what is required is that they knowing participated in the commission of illegal acts
during the strike for there to be sufficient ground for termination of employment. For union officers,
however, it suffices that they knowingly participated in an illegal strike.
Boncacas not only knowingly participated but was the one who organized the two illegal strikes.
ART. 292 (b) [277 (b)]. STATUTORY DUE PROCESS

ST. LUKES MEDICAL CENTER INC. V. NOTARIO October 20, 2010
FACTS: Petitioner employed respondent as in-house security guard. CCTVs were installed in the
premises of petitioner hospital to enhance its security measures and conducted an orientation seminar
for the in- house security personnel on the proper way of monitoring video cameras, subject to certain
guidelines. Later, a foreigner reported to the hospital about the loss of his traveling bags. Acting on the
complaint, the security department of the hospital conducted an investigation. It turns out that the
cameras failed to record any incident of theft on the said room. Petitioner asked respondent to explain
4F 2021-2022 35
in writing why no disciplinary action should be taken against him. Unsatisfied, petitioner dismissed
respondent on the ground of gross negligence/inefficiency. In turn, respondent filed a complaint for
illegal dismissal.
ISSUE: Whether or not the respondent was illegally dismissed?
HELD: YES. Respondent was illegally dismissed without just cause and compliance with the notice
requirement. Neglect of duty, to be a ground for dismissal, must be both gross and habitual. Gross
negligence connotes want of care in the performance of one's duties. Habitual neglect implies repeated
failure to perform one's duties for a period of time, depending upon the circumstances. A single or
isolated act of negligence does not constitute a just cause for the dismissal of the employee. In this
case, the respondent exercised his best judgment in monitoring the CCTV cameras so as to ensure the
security within the hospital premises. Verily, assuming arguendo that respondent was negligent, the
lapse or inaction could only be regarded as a single or isolated act of negligence that cannot be
categorized as habitual and, hence, not a just cause for his dismissal. Petitioners anchor on the
postulate that even a single or isolated act of negligence by respondent constitutes a just cause for his
dismissal as it engendered the possibility of a legal action that may be taken against them by the owner
of the lost items. This is purely speculative.
ALILING V. FELICIANO, WIDE WIDE WORLD G.R. No. 185829; April 25, 2012
EXPRESS CORPORATION
FACTS: Respondent WWWEC offered employment to Aliling as “Account Executive (Seafreight Sales)”
with a 6-month probation period condition with this express caveat that his performance shall be the
basis for confirmation to Regular/Permanent status. WWWEC asked Aliling to handle Ground Express
(GX) instead.
Barely a month after, San Mateo, WWWEC Sales and Marketing Director, emailed Aliling to express
dissatisfaction with the latter’s performance. Lariosa, HR Manager of WWWEC, asked Aliling to report
to the HR to explain his absence without leave to which Aliling denied by sending a copy of his
timesheet. He then tendered his resignation.
Aliling thereafter demanded reinstatement and a written apology, claiming that San Mateo had forced
him to resign. Lariosa informed Aliling that he was subject to evaluation but later on terminated his
services due to his "non-satisfactory performance" during his probationary period. Aliling earlier filed a
Complaint for illegal dismissal, nonpayment of salaries as well as damages with the NLRC. In its position
paper, WWWEC attached a memo asking Aliling to explain why he should not be terminated. Aliling,
however, denied having received a copy of such memo.
ISSUE: W/N Aliling’s right to procedural due process was violated. - YES
HELD: The first and second notice requirements have not been properly observed, thus tainting
petitioner's dismissal with illegality.
The adverted memo of WWWEC supposedly informing Aliling of the likelihood of his termination and
directing him to account for his failure to meet the expected job performance would have had
constituted the "charge sheet," sufficient to answer for the first notice requirement, but for the fact
that there is no proof such letter had been sent to and received by him. Clearly enough, WWWEC did
not comply with the first notice requirement.
Neither was there compliance with the imperatives of a hearing or conference. The record is devoid of
any showing of a hearing or conference having been conducted. On the contrary, barely 5 days after it
served the notice of termination, WWWEC acknowledged that it was still evaluating his case. And the
4F 2021-2022 36
written notice of termination itself did not indicate all the circumstances involving the charge to justify
severance of employment.
PEREZ V. PT&T April 9, 2009

FACTS: Petitioners Perez and Doria were employees of respondent Philippine Telegraph and Telephone
Company (PT&T) assigned in the Shipping Section. Acting on a letter regarding anomalous transactions,
respondents formed a special audit team to investigate the matter and discovered that the Shipping
Section jacked up the value of the freight costs for goods shipped and that the duplicates of the shipping
documents allegedly showed traces of tampering, alteration and superimposition.
Petitioners were placed on preventive suspension for 30 days which was extended for 15 days twice
for their alleged involvement in the anomaly. Then in a Memorandum, petitioners were dismissed from
the service for having falsified company documents. Petitioners filed a complaint for illegal suspension
and illegal dismissal alleging that they were dismissed on November 8, 1993, the date they received the
memorandum.
LA favored petitioners. NLRC reversed the decision of LA. CA affirmed the NLRC decision insofar as
petitioners’ illegal suspension for 15 days and dismissal for just cause were concerned. However, it
found that petitioners were dismissed without due process.
ISSUE: W/N respondents were dismissed for just cause and with the observance of due process. NO
HELD: DUE PROCESS: To meet the requirements of due process in the dismissal of an employee, an
employer must furnish the worker with 2 written notices: (1) a written notice specifying the grounds
for termination and giving to said employee a reasonable opportunity to explain his side and (2) another
written notice indicating that, upon due consideration of all circumstances, grounds have been
established to justify the employer’s decision to dismiss the employee.
Petitioners were neither apprised of the charges against them nor given a chance to defend themselves.
They were simply and arbitrarily separated from work and served notices of termination in total
disregard of their rights to due process and security of tenure. Respondents failed to comply with the
two-notice requirement for terminating employees.
Where the dismissal was without just or authorized cause and there was no due process, Article 294
[279] of the Labor Code mandates that the employee is entitled to reinstatement without loss of
seniority rights and other privileges and full backwages, inclusive of allowances, and other benefits or
their monetary equivalent computed from the time the compensation was not paid up to the time of
actual reinstatement. In this case, however, reinstatement is no longer possible because of the length
of time that has passed. Petitioners will just be paid their separation pay.
ILLEGAL DISMISSAL: Respondents’ evidence is insufficient to clearly and convincingly establish the facts
from which the loss of confidence resulted. Other than their bare allegations and the fact that such
documents came into petitioners’ hands at some point, respondents should have provided evidence of
petitioners’ functions, the extent of their duties, the procedure in the handling and approval of shipping
requests and the fact that no personnel other than petitioners were involved. The alterations on the
shipping documents could not reasonably be attributed to petitioners because it was never proven that
petitioners alone had control of or access to these documents.
SUSPENSION: An employee may be validly suspended by the employer for just cause provided by law.
Such suspension shall only be for a period of 30 days, after which the employee shall either be
reinstated or paid his wages during the extended period.
4F 2021-2022 37
NOTES: Guiding principles in connection with the hearing requirement in dismissal cases:
1. “Ample opportunity to be heard” means any meaningful opportunity (verbal or written) given to
the employee to answer the charges against him and submit evidence in support of his defense,
whether in a hearing, conference or some other fair, just and reasonable way.
2. A formal hearing or conference becomes mandatory only when requested by the employee in
writing or substantial evidentiary disputes exist or a company rule or practice requires it, or when
similar circumstances justify it.
3. The “ample opportunity to be heard” standard in the Labor Code prevails over the “hearing or
conference” requirement in the implementing rules and regulations.
DISTRIBUTION AND CONTROL PRODUCTS INC. V. July 10, 2017

SANTOS
FACTS: Petitioner is a domestic corporation engaged in the business of selling and distributing electrical
products and equipment. Respondent was employed as petitioners' company driver. Respondent filed
a complaint for constructive illegal dismissal and payment of separation pay. He received a notice that
he was being placed under preventive suspension for 30 days because he was one of the employees
suspected of having participated in the unlawful taking of circuit breakers and electrical products of
petitioners; a criminal complaint was filed against him and several other persons; he immediately
inquired from petitioner company's Human Resources Department as to the exact reason why he was
suspended because he was never given the opportunity to explain his side before he was suspended
but the said Department did not give him any concrete explanation; and after the lapse of his 30-day
suspension he was no longer allowed to return to work without any justification for such disallowance.
On their part, petitioner argued that herein respondent and the company warehouseman were the only
persons who had complete access to the company warehouse as they were entrusted with the handling
of all products from the company's suppliers.
ISSUE: Whether or not the dismissal was valid
HELD: No. Our Constitution, statutes and jurisprudence uniformly guarantee to every employee or
worker tenurial security. An employer shall not dismiss an employee except for a just or authorized
cause and only after due process is observed.
Petitioners contend that their termination of respondent's employment was based on their loss of trust
and confidence in him. Loss of trust and confidence is a just cause for dismissal under Article 282(c) of
the Labor Code, which provides that an employer may terminate an employment for "[f]raud or willful
breach by the employee of the trust reposed in him by his employer or duly authorized representative."
However, the employer must satisfy two conditions. First, the employer must show that the employee
concerned holds a position of trust and confidence. Second, the employer must establish the existence
of an act justifying the loss of trust and confidence.
However, petitioners failed to present substantial evidence to support their allegations that respondent
had, in any way, participated in the theft of the company's stolen items and that after his preventive
suspension he no longer reported for work. Petitioners were not able to establish the existence of an
act justifying their alleged loss of trust and confidence in respondent.
AGABON V. NLRC November 17, 2004
4F 2021-2022 38
FACTS: Private respondent Riviera Home Improvements, Inc. is engaged in the business of selling and
installing ornamental and construction materials. It employed petitioners Virgilio Agabon and Jenny
Agabon as gypsum board and cornice installers on January 2, 1992 until February 23, 1999 when they
were dismissed for abandonment of work. Thus, Petitioners then filed a complaint for illegal dismissal
and payment of money claims.
Petitioners also claim that private respondent did not comply with the twin requirements of notice and
hearing. Private respondent, on the other hand, maintained that petitioners were not dismissed but
had abandoned their work.
ISSUE: WON the dismissal was valid?
HELD: Yes. To dismiss an employee, the law requires not only the existence of a just and valid cause but
also enjoins the employer to give the employee the opportunity to be heard and to defend himself.
Abandonment is the deliberate and unjustified refusal of an employee to resume his employment. It is
a form of neglect of duty, hence, a just cause for termination of employment by the employer. For a
valid finding of abandonment, these two factors should be present: (1) the failure to report for work or
absence without valid or justifiable reason; and (2) a clear intention to sever employer-employee
relationship, with the second as the more determinative factor which is manifested by overt acts from
which it may be deduced that the employees has no more intention to work. The intent to discontinue
the employment must be shown by clear proof that it was deliberate and unjustified. In this case,
petitioners were frequently absent having subcontracted for an installation work for another company.
Subcontracting for another company clearly showed the intention to sever the employer-employee
relationship with private respondent.
Procedurally, (1) if the dismissal is based on a just cause, the employer must give the employee two
written notices and a hearing or opportunity to be heard if requested by the employee before
terminating the employment: a notice specifying the grounds for which dismissal is sought a hearing or
an opportunity to be heard and after hearing or opportunity to be heard, a notice of the decision to
dismiss; and (2) if the dismissal is based on authorized causes, the employer must give the employee
and the DOLE written notices 30 days prior to the effectivity of his separation.
In this case, the dismissal is for just cause but due process was not observed. While the procedural
infirmity cannot be cured, it should not invalidate the dismissal. Private respondent is subjected to pay
an indemnity of nominal damages amounting to 30,000.
KING OF KINGS TRANSPORT V. MAMAC June 29, 2007

FACTS: Respondent Mamac was hired as bus conductor of Don Mariano Transit Corporation (DMTC).
Many DMTC employees were subsequently transferred to KKTI. The KKTI employees later organized
the Kaisahan ng mga Kawani sa King of Kings (KKKK) which was registered with DOLE. Respondent was
elected KKKK president. Respondent was required to accomplish a "Conductor’s Trip Report" and
submit it to the company after each trip. Upon audit of the October 28, 2001 Conductor’s Report of
respondent, KKTI noted an irregularity. KKTI nevertheless asked the respondent to explain the
discrepancy. However, respondent later received a letter terminating his employment.
ISSUE: Whether the CA erred in ruling that KKTI did not comply with the requirements of procedural
due process before dismissing the services of the Mamac.
HELD: NO. Due process under the Labor Code involves two aspects: first, substantive––the valid and
authorized causes of termination of employment under the Labor Code; and second, procedural––the
manner of dismissal. In the instant case, KKTI admits that it had failed to provide respondent with a
4F 2021-2022 39
"charge sheet." However, it maintains that it had substantially complied with the rules, claiming that
"respondent would not have issued a written explanation had he not been informed of the charges
against him." SC was not convinced.
First, respondent was not issued a written notice charging him of committing an infraction. The law is
clear on the matter. A verbal appraisal of the charges against an employee does not comply with the
first notice requirement.
Second, even assuming that petitioner KKTI was able to furnish respondent an Irregularity Report
notifying him of his offense, such would not comply with the requirements of the law. We observe from
the irregularity reports against respondent for his other offenses that such contained merely a general
description of the charges against him. The reports did not even state a company rule or policy that the
employee had allegedly violated. Likewise, there is no mention of any of the grounds for termination
of employment under Art. 282 of the Labor Code. Thus, KKTI’s "standard" charge sheet is not sufficient
notice to the employee.
Third, no hearing was conducted. Regardless of respondent’s written explanation, a hearing was still
necessary in order for him to clarify and present evidence in support of his defense. Moreover,
respondent made the letter merely to explain the circumstances relating to the irregularity in his
October 28, 2001 Conductor’s Trip Report. He was unaware that a dismissal proceeding was already
being effected. Thus, he was surprised to receive the November 26, 2001 termination letter indicating
as grounds, not only his October 28, 2001 infraction, but also his previous infractions.
NOTES: To clarify, the following should be considered in terminating the services of employees:
(1) The first written notice to be served on the employees should contain the specific causes or
grounds for termination against them, and a directive that the employees are given the opportunity
to submit their written explanation within a reasonable period. "Reasonable opportunity" under the
Omnibus Rules means every kind of assistance that management must accord to the employees to
enable them to prepare adequately for their defense. This should be construed as a period of at least
five (5) calendar days from receipt of the notice to give the employees an opportunity to study the
accusation against them, consult a union official or lawyer, gather data and evidence, and decide on
the defenses they will raise against the complaint. Moreover, in order to enable the employees to
intelligently prepare their explanation and defenses, the notice should contain a detailed narration of
the facts and circumstances that will serve as basis for the charge against the employees. A general
description of the charge will not suffice. Lastly, the notice should specifically mention which company
rules, if any, are violated and/or which among the grounds under Art. 282 is being charged against the
employees.
(2) After serving the first notice, the employers should schedule and conduct a hearing or conference
wherein the employees will be given the opportunity to: (1) explain and clarify their defenses to the
charge against them; (2) present evidence in support of their defenses; and (3) rebut the evidence
presented against them by the management. During the hearing or conference, the employees are
given the chance to defend themselves personally, with the assistance of a representative or counsel
of their choice. Moreover, this conference or hearing could be used by the parties as an opportunity to
come to an amicable settlement.
(3) After determining that termination of employment is justified, the employers shall serve the
employees a written notice of termination indicating that: (1) all circumstances involving the charge
against the employees have been considered; and (2) grounds have been established to justify the
severance of their employment.
4F 2021-2022 40
PUNCIA V. TOYOTA SHAW June 28, 2019
FACTS: Puncia worked for Toyota as messenger/collector and was later appointed Mktg Professional
tasked to sell 7 vehicles as monthly quota. However, Puncia failed to comply with company’s
requirements on sales quota, prompting Toyota to send him Notice to Explain. Thereafter, a hearing
was conducted but Puncia failed to appear despite notice. Thereafter, Toyota sent her a Notice of
Termination, dismissing her on the ground of insubordination for his failure to attend the scheduled
hearing and justify his absence. This prompted Puncia to file complaint for illegal dismissal. LA ruled
that there was no illegal dismissal however NLRC reversed the LA.
ISSUE: won Punica dismissed for a just cause?
HELD: Yes
In Aliling v. Feliciano, the Court held that an employer is entitled to impose productivity standards for
its employees, and the latter's non-compliance therewith can lead to his termination from work, viz.:
The practice of a company in laying off workers because they failed to make the work quota has been
recognized in this jurisdiction. . . . . In the case at bar, the petitioners' failure to meet the sales quota
assigned to each of them constitute a just cause of their dismissal, regardless of the permanent or
probationary status of their employment. Failure to observe prescribed standards of work, or to fulfill
reasonable work assignments due to inefficiency may constitute just cause for dismissal. Such
inefficiency is understood to mean failure to attain work goals or work quotas, either by failing to
complete the same within the allotted reasonable period, or by producing unsatisfactory results.
In the case at bar, the petitioner’s failure to meet the sales quota assigned to each of them constitute
a just cause of their dismissal, regardless of the permanent or probationary status of their employment.
Failure to observe prescribed standards of work, or to fulfill reasonable work assignments due to
inefficiency may constitute just cause for dismissal. Such inefficiency is understood to mean failure to
attain work goals or work quotas, either by failing to complete the same within the allotted reasonable
period, or by producing unsatisfactory results.
In this regard, case law instructs that gross inefficiency is analogous to gross neglect of duty, a just cause
of dismissal under Article 297 of the Labor Code, for both involve specific acts of omission on the part
of the employee resulting in damage to the employer or to his business.
JAKA FOOD PROCESSING V. PACOT March 28, 2005

FACTS: Respondents Darwin Pacot, Robert Parohinog, David Bisnar, Marlon Domingo, Rhoel Lescano
and Jonathan Cagabcab were earlier hired by petitioner JAKA Foods Processing Corporation (JAKA, for
short) until the latter terminated their employment on August 29, 1997 because the corporation was
"in dire financial straits". It is not disputed, however, that the termination was effected without JAKA
complying with the requirement under Article 283 of the Labor Code regarding the service of a written
notice upon the employees and the Department of Labor and Employment at least one (1) month
before the intended date of termination.
ISSUE: What are the legal implications of a situation where an employee is dismissed for cause but such
dismissal was effected without the employer’s compliance with the notice requirement under the Labor
Code.
HELD: It is, therefore, established that there was ground for respondents' dismissal, i.e., retrenchment,
which is one of the authorized causes enumerated under Article 283 of the Labor Code. Likewise, it is
established that JAKA failed to comply with the notice requirement under the same Article. Considering
4F 2021-2022 41
the factual circumstances in the instant case and the above ratiocination, we, therefore, deem it proper
to fix the indemnity at P50,000.00.
The clear-cut distinction between a dismissal for just cause under Article 282 and a dismissal for
authorized cause under Article 283 is further reinforced by the fact that in the first, payment of
separation pay, as a rule, is not required, while in the second, the law requires payment of separation
pay.
The likewise find the Court of Appeals to have been in error when it ordered JAKA to pay respondents
separation pay equivalent to one (1) month salary for every year of service. The rule, therefore, is that
in all cases of business closure or cessation of operation or undertaking of the employer, the affected
employee is entitled to separation pay. This is consistent with the state policy of treating labor as a
primary social economic force, affording full protection to its rights as well as its welfare. The exception
is when the closure of business or cessation of operations is due to serious business losses or financial
reverses; duly proved, in which case, the right of affected employees to separation pay is lost for
obvious reasons.
ABBOT LABORATORIES V. ALCARAZ July 23, 2013

FACTS: Petitioner Abbott Laboratories, caused the publication of its need for a Medical and Regulatory
Affairs Manager. Alcaraz - who was then a Regulatory Affairs and Information Manager at Aventis
Pasteur Philippines, Incorporated showed interest and submitted her application.
In Abbotts offer sheet, it was stated that Alcaraz was to be employed on a probationary basis. She
accepted the said offer and received an electronic mail (e-mail) from Abbotts Recruitment Officer,
petitioner Teresita C. Bernardo (Bernardo), confirming the same. Attached to Bernardos email were
Abbotts organizational chart and a job description of Alcaraz’ work.
During Alcarazs pre-employment orientation, Abbot briefed her on her duties and responsibilities as
Regulatory Affairs Manager. Petitioner Kelly Walsh (Walsh), Manager of the Literature Drug
Surveillance Drug Safety of Hospira, will be her immediate supervisor. Petitioner Maria Olivia T. Yabut-
Misa (Misa), Abbotts Human Resources (HR) Director, sent Alcaraz an email which contained an
explanation of the procedure for evaluating the performance of probationary employees.
During the course of her employment, Alcaraz noticed that some of the staff had disciplinary problems.
Thus, she would reprimand them for their unprofessional behavior such as non-observance of the dress
code, moonlighting, and disrespect of Abbott officers. However, Alcarazs method of management was
considered by Walsh to be "too strict."
Alcaraz was called to a meeting with Walsh and Terrible, Abbotts former HR Director, where she was
informed that she failed to meet the regularization standards for the position of Regulatory Affairs
Manager. Walsh, Almazar, and Bernardo personally handed Alcaraz a letter stating that her services
had been terminated effective May 19, 2005. The letter detailed the reasons for Alcarazs termination.
Issue: Was Alcaraz illegally dismissed?

HELD: No, but is entitled to damages.
A probationary employee may also be terminated for failure to qualify as a regular employee in
accordance with the reasonable standards made known by the employer to the employee at the time
of the engagement.
4F 2021-2022 42
A probationary employee, like a regular employee, enjoys security of tenure. However, in cases of
probationary employment, aside from just or authorized causes of termination, an additional ground is
provided under Article 295 of the Labor Code, i.e., the probationary employee may also be terminated
for failure to qualify as a regular employee in accordance with the reasonable standards made known
by the employer to the employee at the time of the engagement. Thus, the services of an employee
who has been engaged on probationary basis may be terminated for any of the following: (a) a just or
(b) an authorized cause; and (c) when he fails to qualify as a regular employee in accordance with
reasonable standards prescribed by the employer.
An examination of the records reveals that Abbott had indeed complied with the above-stated
requirements. This conclusion is largely impelled by the fact that Abbott clearly conveyed to Alcaraz
her duties and responsibilities as Regulatory Affairs Manager prior to, during the time of her
engagement, and the incipient stages of her employment. On this score, the Court finds it apt to detail
not only the incidents which point out to the efforts made by Abbott but also those circumstances
which would show that Alcaraz was well-apprised of her employers expectations that would, in turn,
determine her regularization.
Despite the existence of sufficient grounds to terminate Alcarazs employment and Abbotts compliance
with the Labor Code termination procedure, it is readily apparent that Abbott breached its contractual
obligation to Alcaraz when it failed to abide by its own procedure in evaluating the performance of a
probationary employee.
ART. 294 [279]. SECURITY OF TENURE

AGABON V. NLRC November 17, 2004
FACTS: Agabon, et al. were terminated from employment on the ground of Abandonment without
notice and hearing. The employer argued that they abandoned their jobs and was already rendering
jobs in another company.
ISSUE: WON dismissing the employees without statutory due process is an absolute violation of their
right to security of tenure? NO.
HELD: The constitutional policy to provide full protection to labor is not meant to be a sword to oppress
employers. The commitment of this Court to the cause of labor does not prevent us from sustaining
the employer when it is in the right, as in this case.
Certainly, an employer should not be compelled to pay employees for work not actually performed and
in fact abandoned. The employer should not be compelled to continue employing a person who is
admittedly guilty of misfeasance or malfeasance and whose continued employment is patently inimical
to the employer. The law protecting the rights of the laborer authorizes neither oppression nor self-
destruction of the employer.
JAKA FOOD PROCESSING CORP. V. PACOT March 28, 2005

FACTS:
Respondents Darwin Pacot, Robert Parohinog, David Bisnar, Marlon Domingo, Rhoel Lescano and
Jonathan Cagabcab were earlier hired by petitioner JAKA Foods Processing Corporation (JAKA, for short)
until the latter terminated their employment on August 29, 1997 because the corporation was "in dire
financial straits". It is not disputed, however, that the termination was effected without JAKA complying
with the requirement under Article 283 of the Labor Code regarding the service of a written notice upon
4F 2021-2022 43
the employees and the Department of Labor and Employment at least one (1) month before the
intended date of termination.
ISSUE: WoN the respondent has been illegally dismissed. – NO
HELD: A dismissal for just cause under Article 282 implies that the employee concerned has committed,
or is guilty of, some violation against the employer, i.e. the employee has committed some serious
misconduct, is guilty of some fraud against the employer, or, as in Agabon, he has neglected his duties.
Thus, it can be said that the employee himself initiated the dismissal process.
On another breath, a dismissal for an authorized cause under Article 283 does not necessarily imply
delinquency or culpability on the part of the employee. Instead, the dismissal process is initiated by the
employer's exercise of his management prerogative, i.e. when the employer opts to install labor saving
devices, when he decides to cease business operations or when, as in this case, he undertakes to
implement a retrenchment program.
The clear-cut distinction between a dismissal for just cause under Article 282 and a dismissal for
authorized cause under Article 283 is further reinforced by the fact that in the first, payment of
separation pay, as a rule, is not required, while in the second, the law requires payment of separation
pay.
The Statement of Income and Deficit of the respondent-appellant corporation to prove its alleged losses
was prepared by an independent auditor, SGV & Co. It convincingly showed that the respondent-
appellant corporation was in dire financial straits, which the complainants-appellees failed to dispute.
The losses incurred by the respondent-appellant corporation are clearly substantial and sufficiently
proven with clear and satisfactory evidence. Losses incurred were adequately shown with respondent-
appellant's audited financial statement. Having established the loss incurred by the respondent-
appellant corporation, it necessarily necessarily (sic) follows that the ground in support of retrenchment
existed at the time the complainants-appellees were terminated. We cannot therefore sustain the
findings of the Labor Arbiter that the alleged losses of the respondent-appellant was [sic] not well
substantiated by substantial proofs. It is therefore logical for the corporation to implement a
retrenchment program to prevent further losses."
CULILI V. EASTERN TELECOMMUNICATIONS PHILS. February 9, 2011

FACTS: Due to business troubles and losses, respondent ETPI was compelled to implement a right-
sizing program. The first phase of the program involved the reduction of ETPI’s workforce to only those
employees that were necessary and which ETPI could sustain, and the second phase involved a
company-wide reorganization.
As part of the first phase, ETPI offered a special retirement program to its employees, but Culili rejected
the offer. During the second phase, Culili’s position was abolished due to redundancy, and his functions
were absorbed by another department. Thereafter, ETPI informed Culili of his termination from
employment. Culili filed a complaint against ETPI for illegal dismissal, ULP and money claims. For its
part, ETPI claimed that it served a notice of termination to Culili because there was no more work for
him.
ISSUE: WON Culili was illegally dismissed. – NO
HELD: There is redundancy when the service capability of the workforce is greater than what is
reasonably required to meet the demands of the business enterprise. ETPI has sufficiently established
4F 2021-2022 44
not only its need to reduce its workforce and streamline its organization, but also the existence of
redundancy in the position held by Culili (Senior Technician).
However, while Culili’s dismissal was valid, ETPI failed to observe procedural due process in the
termination of Culili by failing to issue a written notice regarding Culili’s termination. In view of ETPI’s
failure to comply with the notice requirements under the Labor Code, Culili is entitled to nominal
damages in addition to his separation pay.
SERRANO V. GALLANT MARITIME March 24, 2009

FACTS: Antonio Serrano was hired by Gallant Maritime as a Chief Officer. On his departure date, Serrano
was constrained to accept a downgraded employment contract for Second Officer, upon the assurance
and representation by respondents that he would be made Chief Officer. When Serrano refused he was
repatriated to the Philippines on May 26, 1998 serving only 2 months and 7 days of his contract, leaving
an unexpired portion of 9 months and 23 days. Consequently, Serrano filed before the LA a complaint
for constructive dismissal and payment of his money claims and moral and exemplary damages and
attorney’s fees. Then upon appeal to the SC, Serrano contended that the clause “or for three months
of every year of the unexpired term, whichever is less” under Sec. 10 of RA 8042 is unconstitutional on
the ground that it violates Sec. 3, Art. 13 of the Constitution, which safeguards the non-impairment of
contracts.
ISSUE: WON Section 3 of Art. 13 of the Constitution bestow an actual enforceable right.
HELD: NO. While all the provisions of the 1987 Constitution are presumed self-executing, there are
some which this Court has declared not judicially enforceable, Article 13 being one, particularly Section
3 thereof, the nature of which, this Court, in Agabon v. National Labor Relations Commission has
described to be not self-actuating. Thus, the constitutional mandates of protection to labor and security
of tenure may be deemed as self-executing in the sense that these are automatically acknowledged
and observed without need for any enabling legislation. However, to declare that the constitutional
provisions are enough to guarantee the full exercise of the rights embodied therein, and the realization
of ideals therein expressed, would be impractical, if not unrealistic. The espousal of such view presents
the dangerous tendency of being overbroad and exaggerated. The guarantees of “full protection to
labor” and “security of tenure,” when examined in isolation, are facially unqualified, and the broadest
interpretation possible suggests a blanket shield in favor of labor against any form of removal regardless
of circumstance. This interpretation implies an unimpeachable right to continued employment—a
utopian notion, doubtless—but still hardly within the contemplation of the framers. Subsequent
legislation is still needed to define the parameters of these guaranteed rights to ensure the protection
and promotion, not only the rights of the labor sector, but of the employers’ as well. Without specific
and pertinent legislation, judicial bodies will be at a loss, formulating their own conclusion to
approximate at least the aims of the Constitution
The subject clause does not state or imply any definitive governmental purpose; and it is for that precise
reason that the clause violates not just petitioner’s right to equal protection, but also her right to
substantive due process under Section 1, Article III of the Constitution. The subject clause being
unconstitutional, petitioner is entitled to his salaries for the entire unexpired period of nine months
and 23 days of his employment contract, pursuant to law and jurisprudence prior to the enactment of
R.A. No. 8042.
4F 2021-2022 45
YAP V. THENAMARIS SHIP’S MANAGEMENT May 30, 2011(for OFW re RA 8042 as amended
by RA 10022)
FACTS: Petitioner entered a one-year contract of employment with Intermare Maritime Agencies as an
electrician of M/T SEASCOUT (one of many vessels owned by Thenamaris Ships) and started working
on August 23, 2001
On November 08, 2001, the M/T SEASCOUT was sold to be scrapped.
Only working for about 3 months, Yap received his seniority bonus, vacation bonus, extra bonus, and
scrapping bonus. He however refused to accept payment of a one month basic wage. Petitioner Yap
insisted that he was entitled to 9 months’ worth of wage, represents the unexpired portion of his
contract with the company, because he was illegally dismissed.
Labor Arbiter - 9 months of basic wage
NLRC - 3 months, but later reversed to 9 months after an MR
Court of Appeals - 3 months
Sec 10 of RA 8042, says, to wit:
"In case of termination of overseas employment without just, valid or authorized cause as defined by
law or contract, the workers shall be entitled to the full reimbursement of his placement fee with
interest of twelve percent (12%) per annum, plus his salaries the unexpired portion of his employment
contract or for three (3) months for every year of the unexpired term, whichever is less."
ISSUE: W/N Sec 10 of RA 8042 is unconstitutional? YES
HELD: We have previously declared that the clause "or for three months for every year of the unexpired
term, whichever is less" is unconstitutional for being violative of the rights of (OFWs) to equal
protection. Moreover, the subject clause does not state any definitive governmental purpose, hence,
it also violates petitioner's right to substantive due process.
Generally, an unconstitutional act is not a law. An exception to this is the doctrine of operative fact
applied when a declaration of unconstitutionality will impose an undue burden on those who have
relied on the invalid law. This case should not be included in the exception. It was not the fault of the
petitioner that he lost his job due to an act of illegal dismissal committed by respondents.
BANK OF LUBAO V. MANABAT February 1, 2012

FACTS: Manabat is an encoder hired by petitioner bank. During his employment, he was found guilty of
malversation of funds. In an administrative hearing it was found through the Bank's audit that Manabat
conspired with another employee in making fraudulent entries disguised as error corrections in the
bank's computer. A criminal case for qualified theft was filed against Manabat. Subsequently, his
employment was terminated due to serious misconduct tantamount to willful breach of trust.
Respondent then filed a complaint for illegal dismissal when the trial court dismissed the case against
him for lack of sufficient basis.
LA found that there respondent was illegally dismissed and further ordered that he be reinstated to his
former position but the respondent refused to return. NLRC affirmed the LA's decision. CA held that
due to the doctrine of strained relations, the respondent is entitled to separation pay in lieu of
reinstatement and backwages from the time of illegal dismissal up to the finality of the decision.
ISSUE:
4F 2021-2022 46
1. W/N the order to pay the respondent separation pay in lieu of reinstatement is proper. – YES
2. W/N the respondent is entitled to payment of backwages. – YES
HELD:
1. An illegally dismissed employee is entitled to reinstatement as a matter of right. However, if
reinstatement would only exacerbate the tension and strained relations between the parties, or
where the relationship between the employer and the employee has been unduly strained by
reason of their irreconcilable differences, particularly where the illegally dismissed employee held
a managerial or key position in the company, it would be more prudent to order payment of
separation pay instead of reinstatement. The payment of separation pay is considered an
acceptable alternative to reinstatement when the latter option is no longer desirable or viable.
Here, we agree with the CA that the relations between the parties had been already strained thereby
justifying the grant of separation pay in lieu of reinstatement in favor of the respondent.
2. The backwages that should be awarded to the respondent should be modified. Employees who are
illegally dismissed are entitled to full backwages, inclusive of allowances and other benefits or their
monetary equivalent, computed from the time their actual compensation was withheld from them
up to the time of their actual reinstatement. But if reinstatement is no longer possible, the
backwages shall be computed from the time of their illegal termination up to the finality of the
decision.
ST. MARY’S ACADEMY V. PALACIO ET. AL. September 8, 2010 (Eg./ Limited backwages)
FACTS: In 1990s, respondents were hired by petitioner as classroom teachers and guidance counselor.
In separate letters dated March 31, 2000, however, petitioner informed them that their re-application
for school year 2000-2001 could not be accepted because they failed to pass the LET. According to
petitioner, as non-board passers, respondents could not continue practicing their teaching profession
pursuant to the DECS’ Memorandum No. 10, s. 1998 which requires incumbent teachers to register as
professional teachers pursuant to Sec. 27 of RA 7836, otherwise known as the Philippine Teachers
Professionalization Act of 1994.
Respondents filed a complaint They argued that their security of tenure could not simply be trampled
upon for their failure to register with the PRC or to pass the LET prior to the deadline (September 19,
2009) set by RA 7836.
LA adjudged petitioner guilty of illegal dismissal. Thus, petitioner was ordered to reinstate the
respondents or to pay them separation pay at the rate of month wage for every year of service, plus
limited backwages covering the period from March 31, 2000 to September 30, 2000. NLRC and CA
affirmed the decision of the LA.
Petitioner justifies respondents’ termination by advancing that it would be difficult to hire licensed
teachers in the middle of the school year as respondents’ replacements. The petitioner contends that
assuming respondents were illegally dismissed, they are only entitled to an amount computed from the
time of dismissal up to September 19, 2000 only. After September 19, 2000, respondents, according to
petitioner, are already dismissible for lack of the necessary license to teach.
ISSUE:
1. Is the dismissal not valid even if the same was made in order to protect the interest of the
employer? – YES
2. Are the amount of separation pay awarded to respondents correct? – YES
4F 2021-2022 47
HELD:
1. The dismissal is not valid. It is incumbent upon this Court to afford full protection to labor. Thus,
while we take cognizance of the employers’ right to protect its interest, the same should be
exercised in a manner which does not infringe on the workers right to security of tenure. Under the
policy of social justice, the law bends over backward to accommodate the interests of the working
class on the humane justification that those with less privilege in life should have more in law. To
reiterate, this Court will not hesitate to defend respondents’ right to security of tenure. The
premature dismissal from the service of respondents is unwarranted.
2. The amount of separation pay awarded to respondents is correct. Petitioner cannot possibly
presume that respondents could not timely comply with the requirements of the law. At any rate,
we note that petitioner only assailed the amount of backwages for the first time in its motion for
reconsideration of the Decision of the CA. Thus, the Court cannot entertain the issue for being
belatedly raised. Hence, the award of limited backwages covering the period from March 31, 2000
to September 30, 2000 as ruled by the LA and affirmed by both the NLRC and CA is in order.
TOYOTA MOTOR PHILS. CORP. WORKERS October 19, 2007

ASSOCIATION V. NLRC
FACTS: More than 200 employees of Toyota were terminated from work after they participated in 2
strikes on separate occasions, causing substantial losses on the part of Toyota due to its inability to
meet the production goals.
It appears that on the first instance, the Union requested that they be allowed to attend the hearing of
the pending mediation case, to which Toyota management refused. Despite such, the employees-union
members and officers still did not report to work for 2 consecutive days.
They received individual notices to explain from Toyota, then thereafter, notices for their termination.
As a reaction, they again staged a strike.
NLRC and CA affirmed the validity of dismissal and ordered payment of severance pay equivalent to
1 month salary per year of service.
ISSUE: WON the validly terminated employees are entitled to payment of severance pay.
HELD: NO. separation should not be awarded to the Union members who participated in the illegal
strikes. The general rule is that when just causes for terminating the services of an employee under Art.
282 of the Labor Code exists, the employee is not entitled to separation pay. Lawbreakers should not
benefit from their illegal acts.
However, despite the dismissal for a valid cause, employees retain the right to receive from the
employer benefits provided by law, like accrued service incentive leaves.
With respect to benefits granted by the CBA provisions and voluntary management policy or practice,
the entitlement of the dismissed employees to the benefits depends on the stipulations of the CBA or
the company rules and policies.
One exception where separation pay is given even though an employee is validly dismissed is when the
court finds justification in applying the principle of social justice well entrenched in the 1987
Constitution. Severance compensation shall be allowed only when the cause of the dismissal is other
than serious misconduct or that which reflects adversely on the employees’ moral character.
In this case, there can be no good faith in intentionally incurring absences in a collective fashion from
work just to attend DOLE hearings. The Union members should know from common sense that the
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company will incur substantial amounts of losses. In a slew of cases, the Court refrained from awarding
separation pay or financial assistance to union officers and members who were separated from service
due to their participation in or commission of illegal acts during strikes.
BRISTOL MYERS SQUIBB INC. V. HABAN December 17, 2008

FACTS: Petitioner hired respondent as district manager of the company. His duties included the
promotion of nutritional products of petitioner to medical practitioners. While conducting a field audit
in Mindanao, petitioner's auditor found twenty (20) packs of "Mamacare" samples in the baggage
compartment of a company car with an accompanying note with political overtones. A note stapled
on the package reads: “"Even if I've lost (sic) thank you so much for the support. Bidding you farewell
for 36 years of public service. Will continue to help for the good of the city of Zamboanga. Atty. Ricardo
S. Baban, Jr." Referred to in the note is respondent's father who had served as councilor but lost in his
bid for the vice-mayoralty post. Apparently, respondent's father was thanking supporters through
distribution of company sample products.
The auditor reported the incident. Respondent was given the chance to submit evidence and to be
assisted by counsel during a private conference with the company's Medical Sales Director. He received
under protest the company's memorandum dismissing him from employment.
Questioning the validity of his dismissal, respondent filed a complaint for illegal dismissal. The LA
dismissed the complaint. The NLRC upheld the termination of respondent. The CA found the dismissal
unjustified.
ISSUE: May the CA order the reinstatement, with full backwages and damages, of a confidential
employee whom it had found to be guilty of breach of trust? – NO
HELD: As a result of respondent’s handling of large amounts of petitioner's samples, respondent is, by
law, an employee with a position of trust, falling under the second class, which are defined as those
who in the normal and routine exercise of their functions, regularly handle significant amounts of
money or property. Respondent's act of stapling a thank you note from his father warrants the loss
of petitioner's trust and confidence by not asking for permission before using company property for
his own or another's benefit, as required in the Company Standards of Business Conduct. Moreover,
when respondent failed to turn over the samples left in his care and stapled the political "thank you"
note with the intention of distributing them to his father's supporters, he had, in effect appropriated
company property for personal gain and benefit.
However, while We find that the dismissal is valid, We are not deaf to respondent's plea for mercy.
Since respondent was validly dismissed for a cause other than serious misconduct or those that
negatively reflect on his moral character, the award of separation pay is justifiable as to coat the bitter
termination experienced by respondent with a little social justice.
YRASUEGUI V. PAL October 17, 2008

FACTS: In 1984, the weight problem started, which prompted PAL to send the petitioner to an extended
vacation until November 1985. He was allowed to return to work once he lost all the excess weight. But
the problem recurred. He again went on leave without pay from October 17, 1988 to February 1989.
Despite the lapse of a ninety-day period given him to reach his ideal weight, petitioner remained
overweight. On January 3, 1990, he was informed of the PAL decision for him to remain grounded until
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such time that he satisfactorily complies with the weight standards. Again, he was directed to report
every two weeks for weight checks, which he failed to comply with.
On April 17, 1990, petitioner was formally warned that a repeated refusal to report for weight check
would be dealt with accordingly. He was given another set of weight check dates, which he did not
report to.
On November 13, 1992, PAL finally served petitioner a Notice of Administrative Charge for violation of
company standards on weight requirements. Petitioner insists that he is being discriminated as those
similarly situated were not treated the same.
On June 15, 1993, petitioner was formally informed by PAL that due to his inability to attain his ideal
weight, “and considering the utmost leniency” extended to him “which spanned a period covering a
total of almost five (5) years,” his services were considered terminated “effective immediately.”
ISSUE: WON he was validly dismissed.
HELD: In the case at bar, the evidence on record militates against petitioner’s claims that obesity is a
disease. That he was able to reduce his weight from 1984 to 1992 clearly shows that it is possible for
him to lose weight given the proper attitude, determination, and self-discipline. Indeed, during the
clarificatory hearing on December 8, 1992, petitioner himself claimed that “[t]he issue is could I bring
my weight down to ideal weight which is 172, then the answer is yes. I can do it now.”
Petitioner has only himself to blame. He could have easily availed the assistance of the company
physician, per the advice of PAL.
In fine, We hold that the obesity of petitioner, when placed in the context of his work as flight
attendant, becomes an analogous cause under Article 282(e) of the Labor Code that justifies his
dismissal from the service. His obesity may not be unintended, but is nonetheless voluntary. As the CA
correctly puts it, “[v]oluntariness basically means that the just cause is solely attributable to the
employee without any external force influencing or controlling his actions. This element runs through
all just causes under Article 282, whether they be in the nature of a wrongful action or omission. Gross
and habitual neglect, a recognized just cause, is considered voluntary although it lacks the element of
intent found in Article 282(a), (c), and (d).”
DREAMLAND HOTEL RESORT V. JOHNSON March 12, 2014 (separation pay and strained
relations)
FACTS: Petitioner Prentice convinced Johnson to become the resort manager and give out a loan,
purportedly so the resort can be completed and operational by August 2007. However, since Johnson’s
employment as manager, he was not given his salary and denied of the benefits promised by
petitioners. Hence, Johnson was forced to submit his resignation. Despite demands, petitioners refused
to pay Johnson the salaries and benefits due him. Thus, he filed a complaint for illegal dismissal and
nonpayment of salaries, among others.
ISSUE: WON Johnson is entitled to relief.
HELD: YES. The normal consequences of respondents’ illegal dismissal, then, are reinstatement without
loss of seniority rights, and payment of backwages computed from the time compensation was
withheld up to the date of actual reinstatement. Where reinstatement is no longer viable as an option,
separation pay equivalent to one (1) month salary for every year of service should be awarded as an
alternative. The payment of separation pay is in addition to payment of backwages.
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Under the doctrine of strained relations, the payment of separation pay is considered an acceptable
alternative to reinstatement when the latter option is no longer desirable or viable. On one hand, such
payment liberates the employee from what could be a highly oppressive work environment. On the
other hand, it releases the employer from the grossly unpalatable obligation of maintaining in its
employ a worker it could no longer trust. In the present case, the NLRC found that due to the strained
relations between the parties, separation pay is to be awarded to Johnson in lieu of his reinstatement.
MANILA WATER V. DEL ROSARIO January 29, 2014 (separation pay)

FACTS: It appeared that Del Rosario and his co-employee were involved in the pilferage and sale of
water meters to the company’s contractor. Del Rosario confessed his involvement and pleaded for
forgiveness. During the formal investigation, Del Rosario was found responsible for the loss of water
meters and therefore liable for violating the company’s code of conduct. Manila Water dismissed Del
Rosario.
ISSUE: WON Del Rosario is entitled to separation pay
HELD: No. As a general rule, an employee who has been dismissed for any of the just causes
enumerated under Article 282 of the Labor Code is not entitled to a separation pay. In exceptional
cases, however, the Court has granted separation pay to a legally dismissed employee as an act of
"social justice" or on "equitable grounds."
In both instances, it is required that the dismissal (1) was not for serious misconduct; and (2) did not
reflect on the moral character of the employee.
Although the long years of service might generally be considered for the award of separation benefits
to mitigate the effects of termination, this case is not the appropriate instance for generosity under the
Labor Code since his violation reflects a regrettable lack of loyalty and worse, betrayal of the company.
NACAR V. GALLERY FRAMES August 13, 2013 (interest rate)

FACTS: Petitioner filed a complaint for illegal dismissal against the respondent alleging that he was
dismissed without any just cause. LA found Gallery Frames guilty of illegal dismissal and awarded Nacar
in damages consisting of backwages and separation pay. Gallery Frames appealed all the way to the
Supreme Court.
After the finality of the SC decision affirming the decision of the LA, Nacar filed a motion before the LA
for recomputation as he alleged that his backwages should be computed from the time of his illegal
dismissal until the finality of the SC decision with interest. The LA denied the motion as he ruled that
the reckoning point of the computation should only be from the time Nacar was illegally dismissed until
the decision of the LA.
ISSUE: W/N the petitioner is correct. YES
HELD: As a rule, backwages is computed from the time of the illegal dismissal up to the time of the
actual reinstatement. However, if reinstatement is no longer possible, it is computed until the finality
of the decision.
If the employer appeals, then the end date shall be extended until the day when the appellate court’s
decision shall become final. Hence, as a consequence, the liability of the employer, if he loses on appeal,
will increase.
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In the absence of an express stipulation as to the rate of interest that would govern the parties, the
rate of legal interest for loans or forbearance of any money, goods or credits and the rate allowed in
judgments shall no longer be 12% per annum but will now be 6% per annum effective July 1, 2013. It
should be noted, nonetheless, that the new rate could only be applied prospectively and not
retroactively. Consequently, the 12% per annum legal interest shall apply only until June 30, 2013. From
July 1, 2013 the new rate of 6% per annum shall be the prevailing rate of interest when applicable.
BANI RURAL BANK, INC. V. DE GUZMAN G.R. No. 170904; November 13, 2013
(computation)
FACTS: The respondents in this case filed a complaint for illegal dismissal against the petitioner. The
NLRC ordered that respondents be reinstated with payment of backwages from the time of their
dismissal until their actual reinstatement. Such decision has become final and executory. Computation
of backwages was referred to LA.
Petitioners appealed the computation of the backwages with the NLRC. The NLRC additionally awarded
the payment of separation pay, in lieu of reinstatement on account of the strained relations between
the parties.
ISSUE: W/N the computation of backwages are correct. – YES
HELD: The computation of backwages depends on the final awards adjudged as a consequence of illegal
dismissal. As a rule, backwages is computed from the time of the illegal dismissal up to the time of the
actual reinstatement. However, if reinstatement is no longer possible, it is computed until the finality
of the decision.
In this case, respondents backwages can no longer be computed up to the point of reinstatement as
there is no longer any award of reinstatement to speak of. Thus, the computation of the respondents'
backwages must be from the time of the illegal dismissal from employment until the finality of the
decision ordering the payment of separation pay. The respondents' backwages, therefore, must be
computed from the time of their illegal dismissal until January 29, 1999, the date of finality of the NLRC
Decision.
LARA’S GIFT & DECORS V. MIDTOWN INDUSTRIAL August 28, 2019 (revised rules on interest)
SALES
FACTS: Lara’s (Client) is engaged in the manufacture, selling and exporting of handicrafts. Midtown
(Supplier) is engaged in selling industrial and construction materials and Lara is one of its clients.
Lara made several purchases from Midtown on a sixty (60)-day credit term, with the condition that 24%
interest per annum would be charged on all accounts overdue, as stated in the sales invoices.
Midtown was issued several checks which apparently bounced more than once, even after repeated
demands from Lara. Lara interposed that non-payment was due to the poor quality of products
delivered by Midtown, which caused its failing the standard of its US buyers, raising also the economic
recession in US and the fire incident in its factory. Lara questioned the validity of the 24% interest rate.
ISSUE: Whether or not the 24% interest is valid. YES
HELD: The 24% interest rate is valid. The general rule is that the interest stipulated by the parties shall
apply, provided it is not excessive and unconscionable. Absent any stipulation, the prevailing legal
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interest prescribed by BSP applies to loans or forbearance of money, goods or credits, as well as to
judgments.
In the present case, the validity of interest rate fixed at 24% per annum that was expressly stipulated
in the sales invoices. The Court held that petitioner is presumed to have full knowledge of the terms
and conditions of the contract and that by not objecting to the stipulations in the sales invoice, it also
bound itself to pay not only the stated selling price but also the interest of 24% per annum on overdue
accounts and the 25% of the unpaid invoice for attorney's fees.
SESSION DELIGHTS V. CA February 8, 2010 (backwages in relation to

immutability of judgment)
FACTS: The private respondent filed against the petitioner a complaint for illegal dismissal. LA decided
that there was illegal dismissal and awarded the private respondent backwages, separation pay in lieu
of reinstatement, indemnity, and attorney’s fees. NLRC affirmed LA. CA affirmed with modification the
NLRC decision by deleting the award of proportional 13th month pay and the award of indemnity for
failure to observe due process. A pre-execution conference was held with the contending parties in
attendance. The Finance Analyst submitted an updated computation of the monetary awards due the
private respondent in the total amount of ₱235,986.00 which included additional backwages and
separation pay due the private respondent and the proportionate amount of the private respondent’s
13th month pay. LA approved the updated computation. The petitioner objected to the re-computation
and appealed the LA’s order to the NLRC. Petitioner claimed that the updated computation was
inconsistent with the dispositive portion of the LA’s 2001 decision.
ISSUE: Whether or not the computation of the awards made improper and this violated the principle
of immutability of final judgments
HELD: No. The LA decision consists essentially of two parts. First is that part of the decision that cannot
now be disputed because it has been confirmed with finality. This is the finding of the illegality of the
dismissal and the awards of separation pay in lieu of reinstatement, backwages, attorney’s fees, and
legal interests. Second is the computation of the awards made. This part, being merely a computation
of what the first part of the decision established and declared, can, by its nature, be re-computed.
No essential change is made by a re-computation as this step is a necessary consequence that flows
from the nature of the illegality of dismissal declared in the decision. A re-computation (or an original
computation, if no previous computation has been made) is a part of the law – specifically, Article 279
of the Labor Code and the established jurisprudence on this provision – that is read into the decision.
By the nature of an illegal dismissal case, the reliefs continue to add on until full satisfaction. The re-
computation of the consequences of illegal dismissal upon execution of the decision does not constitute
an alteration or amendment of the final decision being implemented. The illegal dismissal ruling stands;
only the computation of monetary consequences of this dismissal is affected and this is not a violation
of the principle of immutability of final judgments.
UNITED COCONUT CHEMICALS V. ALMORES July 12, 2017 (inclusions in backwages, employer
liability in illegal dismissal done in relation to a
union security clause)
FACTS: UCCI hired respondent as Senior Utilities Inspector and became a member of UELO (United
Coconut Chemicals, Inc. Employees Labor Organization) until his expulsion in 1995. Due to the
expulsion, UELO formally demanded that UCCI terminate the services of respondent pursuant to the
4F 2021-2022 53
union security clause of the CBA. UCCI dismissed him. He filed a complaint for illegal dismissal. LA
dismissed his complaint but was reversed by NLRC. NLRC ruled in his favor and ordered UCCI to
reinstate Victoriano to his former position without loss of seniority rights and with full backwages from
the date of dismissal on 22 February 1996 to the date of actual reinstatement. CA ruled that there was
illegal dismissal although petitioner is not liable for full backwages . It was appealed to the SC but was
denied. Respondent moved for execution of judgment. LA Lontoc ruled that the backwages due to
respondent should be computed by the wage rate at the time of his dismissal and included in the
computation 13th month pay and SIL but excluded CBA granted benefits. However, NLRC reversed the
LA and ruled to include benefits granted under the CBA. CA affirmed NLRC.
UCCI posits that in determining the respondent's backwages the prospective increases in wages as well
as the benefits provided in the CBA should be excluded; that, as a consequence, the base figure for
computing the respondent's backwages should be his basic salary prevailing at the time of his dismissal,
unqualified by deductions or increases.
ISSUE: WON the benefits provided under the CBA should be excluded?
HELD: No. Backwages include all benefits previously enjoyed by the illegally dismissed employee. The
base figure for the computation of backwages should include not only the basic salary but also the
regular allowances being received, such as the emergency living allowances and the 13th month pay
mandated by the law. The amount does not include the increases or benefits granted during the period
of his dismissal because time stood still for him at the precise moment of his termination, and move
forward only upon his reinstatement. Hence, the respondent should only receive backwages that
included the amounts being received by him at the time of his illegal dismissal but not the benefits
granted to his co-employees after his dismissal. The purpose for this is to compensate the worker for
what he has lost because of his dismissal, and penalty on the employer for illegall dismissal.
CBA allowances and benefits that the respondent was regularly receiving before his illegal dismissal
should be added. Article 279 of the Labor Code decrees that the backwages shall be "inclusive of
allowances, and to his other benefits or their monetary equivalent." Considering that the law does not
distinguish between the benefits granted by the employer and those granted under the CBA, he should
not be denied the latter benefits.
UNIVERSAL ROBINA CORP. V. CASTILLO July 10, 2013

FACTS: Respondent Wilfredo Z. Castillo (Castillo) was hired by petitioner as a truck salesman. He
became a Regional Sales Manager, until his dismissal on 12 January 2006 (after around 23 years of
service). His area of responsibility covered some parts of Laguna, including Liana’s Supermart (Liana) in
San Pablo City, Laguna.
URC’s Credit and Collection Department (CCD) Analyst in Silangan, Laguna Branch noted an outright
deduction in the amount of ₱72,000.00 tagged as Gift Certificate (GC) per Original Receipt No. 625462
dated 18 August 2005. The CCD Analyst found the issuance of GCs as unusual. The CIA suspected that
respondent might have committed an act of fraud against the company and Liana’s for his personal
gain. After due process, he was found guilty of acts inimical to the interest of the Company and for
breach of trust & confidence (a just and valid cause), thus his service was terminated.
Respondent filed a complaint for illegal dismissal. He alleged that the grounds for which he was
dismissed were totally different from the charges leveled against him during the investigation.
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LA declared respondent to have been illegally dismissed and ordered the payment of backwages and
separation pay. It ruled that the respondent was asked to explain on charges which are different from
the charges for which he was dismissed.
NLRC reversed the decision of the labor arbiter.
CA upheld his dismissal but awarded him separation pay "as a form of equitable relief."
ISSUE: Whether or not respondent is entitled to separation pay.
HELD: No. As the rule now stands, the award of separation pay is authorized in the situations dealt with
in Article 283 and 284 of the Labor Code, but not in terminations of employment based on instances
enumerated in Article 282. Central Philippines Bandag Retreaders, Inc. cautioned labor tribunals in
indiscriminately awarding separation pay as a measure of social justice.
Indeed, respondent has committed acts constituting willful breach of trust and confidence reposed on
him by URC. Assuming that he did not receive the gift certificates, petitioner Castillo’s ready admission
that he signed the charge invoices even if these were blank clearly shows his negligence and utter lack
of care in the interests of private respondent URC. As a Regional Sales Manager, petitioner Castillo
occupied a position or responsibility and as such, he should have known that he placed the interests of
the company at a disadvantage by signing the blank charge invoices. Because of such act, private
respondent URC was prejudiced by no less than ₱72,000.00. This alone is sufficient cause for breach of
trust and loss of confidence.
In Bank of the Philippine Islands v. NLRC and Arambulo, we ruled that an employee who has been
dismissed for a just cause under Article 282 of the Labor Code is not entitled to separation pay. The
complainant therein was likewise dismissed on the ground of Joss of trust and confidence. Applying
that rule to the instant case, we here hold that the respondent is not entitled to separation pay.
BAPTISTA V. VILLANUEVA July 31, 2013

FACTS: Petitioners were former union members of Radio Philippines Network Ees Union (RPNEU). It
was the sole and exclusive bargaining agent of the rank and file employees, while the respondents were
the union’s officers and members.
A complaint for impeachment of their union president, Reynato Siozon was filed due to their suspicion
of union mismanagement. They re-lodged the impeachment complaint, this time against all the union
members and officers of RPNEU before the DOLE. However, complaint against petitioners were likewise
filed for violation of union constitution and bylaws, for urging an action in court of justice without first
exhausting internal remedies available.
Petitioners were served with expulsion notice. Thereafter, a complaint for ULP was filed by petitioners
on the ground they were denied substantive and procedural due process when they were expelled from
union.
ISSUE: won petitioners were denied substantive and procedural due process in their expulsion?
HELD: NO. expulsion was valid.
Workers’ and employers’ organizations have the right to draw up their constitutions. In this case, the
union’s constitution and bylaws expressly mandate that before a party is allowed to seek the
intervention of the court, it is a precondition that he should have availed of all internal remedies within
the organization. Petitioners violated such when they filed for impeachment against officers directly
before the DOLE. This act is a ground for expulsion from union membership. Petitioners’ expulsion from
4F 2021-2022 55
the union was not a deliberate attempt to curtail their right to organize, but was triggered by the
commission of an act, expressly sanctioned by their Constitution.
Moreover, as provided in their Constitution, any charge against the member must be submitted to BOD
and not to the Committee. Although respondents filed the charge before the Committee, this supposed
procedural flaw was deemed cured when petitioners were given the opportunity to be heard. After all,
the essence of due process is simply to be heard.
BPI EMPLOYEES UNION DAVAO CITY V. BPI July 24, 2013

FACTS: A service agreement between BPI and BOMC was initially implemented in BPI's Metro Manila
branches. In this agreement, BOMC undertook to provide services such as check clearing, delivery of
bank statements, fund transfers, card production, operations accounting and control, and cash
servicing, conformably with BSP Circular No. 1388.
The service agreement was likewise implemented in Davao City.
Later, a merger between BPI and Far East Bank and Trust Company (FEBTC) took effect on April 10,
2000 with BPI as the surviving corporation.
Thereafter, BPI's cashiering function and FEBTC's cashiering, distribution and bookkeeping functions
were handled by BOMC. Consequently, twelve (12) former FEBTC employees were transferred to BOMC
to complete the latter's service complement.
BPI Davao's rank and file collective bargaining agent, BPI Employees Union-Davao City-FUBU (Union),
objected to the transfer of the functions and the twelve (12) personnel to BOMC contending that the
functions rightfully belonged to the BPI employees and that the Union was deprived of membership of
former FEBTC personnel who, by virtue of the merger, would have formed part of the bargaining unit
represented by the Union pursuant to its union shop provision in the CBA.
ISSUE: The primordial issue in this case is whether or not the act of BPI to outsource the cashiering,
distribution and bookkeeping functions to BOMC is in conformity with the law and the existing CBA.
Particularly in dispute is the validity of the transfer of twelve (12) former FEBTC employees to BOMC,
instead of being absorbed in BPI after the corporate merger.
HELD: YES. It is incomprehensible how the "reduction of positions in the collective bargaining unit"
interferes with the employees' right to self-organization because the employees themselves were
neither transferred nor dismissed from the service.
In one case, the Court held that it is management prerogative to farm out any of its activities, regardless
of whether such activity is peripheral or core in nature. What is of primordial importance is that the
service agreement does not violate the employee's right to security of tenure and payment of benefits
to which he is entitled under the law.
INTEGRATED MICROELECTRONICS V. PIONELLES August 28, 2013

FACTS: Pionella was employed with IMI. He was terminated from employment because he was caught
lending his company ID to a woman who is a non-employee in order to board the company bus. The
woman was a relative. LA ruled for his reinstatement.
ISSUE: Whether or not Pionella must be given his back wages in addition to his reinstatement. – NO
4F 2021-2022 56
HELD: As a general rule, back wages are given to an employee illegally dismissed. However, there are
exceptions to this rule: (a) dismissal is too harsh a penalty and (b) employer acted in good faith. In this
case, the two requisites are present. Dismissal is too harsh since Pionella was able to do it due to
pakikisama. Also IMI was in good faith in dismissing Pionella since it was just following its company
rules. Thus back wages will not be given to Pionella.
GOLDEN ACE BUILDERS V. TALDE May 5, 2010

FACTS: Talde was hired as a carpenter by Golden Ace. Azul (owner-manager) alleged unavailability of
projects and stopped giving assignments to respondent. Hence, this illegal dismissal case.
Talde said that there were threats to his life and his family, hence, he opted for the payment of
separation pay instead of reinstatement.
ISSUE: WON the fact of strained relations was proved thereby justifying the award of separation pay
instead of reinstatement? Yes.
HELD: Separation pay is granted where reinstatement is no longer advisable because of strained
relations between the employee and the employer. The basis for computing separation pay is the actual
period when the employee was unlawfully prevented from working.
Under the doctrine of strained relations, the payment of separation pay is considered an acceptable
alternative to reinstatement when the latter option is no longer desirable or viable. On one hand, such
payment liberates the employee from what could be a highly oppressive work environment.
In the present case, the Labor Arbiter found that actual animosity existed between petitioner Azul and
respondent as a result of the filing of the illegal dismissal case. Clearly then, respondent is entitled to
backwages and separation pay as his reinstatement has been rendered impossible due to strained
relations.
METROGUARDS SECURITY AGENCY CORP. V. March 9, 2015

HILONGO
FACTS:
In his Decision3 dated April 30, 2010 in NLRC NCR-10-14411-09, entitled Alberto Hilongo v. Bee Guards
Corp./Milagros Chan, the Labor Arbiter ruled that herein respondent Alberto N. Hilongo was illegally
dismissed, to wit:
WHEREFORE, premises considered, judgment is rendered finding the dismissal of
complainant [Hilongo] as illegal and ordering the respondents [herein petitioners] to pay
complainant [Hilongo] his backwages from the date of dismissal to the date of this
decision and separation pay of one month pay per year of service, plus 10% thereof as
attorney’s fees as all hereunder computed.
ISSUE: WoN there shall be recomputation of the total monetary benefits due to petitioner. – YES
HELD: The re-computation of the consequences of illegal dismissal upon execution of the decision does
not constitute an alteration or amendment of the final decision being implemented. The illegal
dismissal ruling stands; only the computation of monetary consequences of this dismissal is affected,
and this is not a violation of the principle of immutability of final judgments.
4F 2021-2022 57
The decision became final and executory on April 26, 2013. Thus, the April 30, 2010 Decision of the
Labor Arbiter which ordered the payment of separation pay in lieu of reinstatement, effectively ended
the employment relationship of the parties on April 26, 2013, the date the CA decision became final.
Since the Labor Arbiter’s computation of Hilongo’s monetary award was up to the date of his April 30,
2010 Decision only, the CA properly decreed the computation of additional back wages and separation
pay.
The computation of the monetary consequences (back wages and separation pay) of the illegal
dismissal decision should be reckoned from its finality, the additional back wages and separation pay
of Hilongo should be computed from May 1, 2010 to April 26, 2013. Further, the payment of legal
interest of 12% per annum should also be from April 26, 2013 up to June 30, 2013.
MAERSK-FILIPINAS CREWING INC. V. AVESTRUZ February 18, 2015 (OFW)

FACTS: Avestruz was hired as a chief cook on M/V Nedlloyd Drake, wherein part of his duties is to ensure
the cleanliness of the galley. During the weekly inspection of the vessel, the captain of the vessel
noticed that the cover of the garbage bin in the kitchen was oily, and called on Avestruz to feel it.
Shocked, Avestruz said, “Sir, if you are looking for dirt, you can find it. The ship is big. Tell us if you want
to clean and we will clean it.” The captain replied by shoving Avestruz’s chest, and an argument
subsequently ensued. Later that day, the captain summoned Avestruz and informed him that he will be
dismissed from service.
Avestruz filed a complaint for illegal dismissal against Maersk, claiming that he was not afforded due
process because he was not notified nor allowed to defend himself before he was dismissed. For its
part, Maersk claimed that the dismissal was for just cause, because he failed to attend to his task of
maintaining the cleanliness of the galley, and that he was insubordinate towards the captain.
ISSUE: WON Avestruz was validly dismissed on the ground of insubordination. – NO
HELD: Insubordination, as a just cause for the dismissal of an employee, has two requisites: (1) the
employee’s assailed conduct must have been willful, that is, characterized by a wrongful and perverse
attitude; and (2) the order violated must have been reasonable, lawful, made known to the employee,
and must pertain to the duties which he had been engaged to discharge.
In this case, the contents of Captain Woodward’s emails to Maersk explaining the decision to terminate
Avestruz does not establish that his conduct was willful or characterized by a wrongful or perverse
attitude. The burden to prove the claim of insubordination by substantial evidence rests on the
petitioners, but they failed to discharge the same. Having failed to do so, their argument that Avestruz
was validly dismissed cannot be sustained. Moreover, the Court states that Avestruz was not accorded
due process, there being no compliance with the “two-notice rule” under Section 17 of the POEA-SEC.
VILLENA V. BATANGAS II ELECTRIC February 4, 2015

FACTS: Concepcion Villena was hired by respondent as a bookkeeper. She was later on promoted as a
finance manager. Then she was demoted to the position of Auditor, which caused her to file a complaint
for constructive dismissal before the LA. Through the course of the judicial processes it was ruled that
Villena was illegally dismissed and she was entitled among others to any other benefits pertaining to
the position of Finance Manager at the time she was removed therefrom up to the date of her actual
reinstatement. Later on, the decision of the NLRC became final and executory, She then moved for the
execution of the decision. Later on, BATELEC II contended that Villena was not entitled to salary
4F 2021-2022 58
differentials, allowances and benefits of a finance manager, separation pay, and allowances for
representation, transportation, and cellular phone usage.
ISSUE: WON Villena is entitled to the award of representation, transportation, and cellular phone usage
allowances.
HELD: Yes. Art. 294 provides that an employee who is unjustly dismissed from work shall be entitled to,
among others, to his full backwages, inclusive of allowances, and to his other benefits or their monetary
equivalent computed from the time hsi compensation was withheld from him up to the time of his
actual reinstatement. It is clear from BATELEC II’s pleadings and submissions that representation
allowance, transportation allowance, and cellular phone usage allowance are given to the Finance
Manager/Department Manager as part of their benefits, unlike the separate entitlement to retirement
pay which may be recovered only upon a meritorious subsequent application when the employee
decides to retire. Consequently, these allowances ought to be included in the "other benefits pertaining
to the position of Finance Manager" to which Villena is entitled to and which were awarded to her
under the final and executory CA Decision and NLRC Resolution. Hence, the claim of Villena is granted.
SANGWOO PHILS. V. SANGWOO PHILIPPINES December 9, 2013

EMPLOYEES UNION
FACTS: On Feb. 12, 2004, Sangwoo Philippines, Inc. (SPI) notified its employees who are members of
Sangwoo Philippines, Inc. Em ployees Union (SPEU) of its permanent closure and cessation of business
operation effective March 16, 2004, due to serious economic losses and financial reverses. The notice
was posted in conspicuous places within the company premises. The Department of Labor and
Employment (DOLE) was furnished a copy of the notice last Feb. 13, 2004, together with a separate
letter notifying it of the company's permanent closure. SPEU was also furnished with a copy.
LA, NLRC and CA found that SPI complied with the notice requirement before closure of business.
ISSUE: Whether of not SPI complied with the notice requirement of Art 297
HELD: NO. Article 297 of the Labor Code provides that before any employee is terminated due to
closure of business, it must give a one month's prior written notice to the employee and to the DOLE.
Jurisprudence states that an employer's act of posting notices to this effect in conspicuous areas in the
workplace is not enough. Verily, for something as significant as the involuntary loss of one's
employment, nothing less than an individually-addressed notice of dismissal supplied to each worker is
proper.
It is well to stress that while SPI had a valid ground to terminate its employees, i.e., closure of business,
its failure to comply with the proper procedure for termination renders it liable to pay the employee
nominal damages for such omission.
PAPERTECH, INC. V. KATANDO G.R. No. 236020; January 8, 2020 (doctrine of

strained relations)
FACTS: Papertech hired Katando as a machine operator. Katando and other employees of Papertech
conducted a picket in the company. This prompted Papertech to file a Complaint for Illegal Strike against
Katando and the other participants. Papertech prayed that the participants be declared to have lost
their employment. CA and SC upheld the NLRC order of reinstatement of Katando and her fellow
employees.
4F 2021-2022 59
Papertech sent a notice to Katando and other employees ordering them to report to various posts in
different provinces, under pain of removal in case of non-compliance. They filed a Manifestation Urgent
Motion to Cite Respondent Company in Contempt which LA Que denied, so they filed a verified petition
before the NLRC. NLRC granted and ordered LA Que to resolve the issues on the salaries and to proceed
with the execution of the NLRC Decision.
Katando received a memorandum from Papertech transferring her to its Makati office. Katando
received another memorandum asking her to explain why she should not be subjected to disciplinary
action for failing to sign the memorandum, for her refusal to transfer to the Makati office, and for
shouting at Papertech's representative. Papertech imposed a 7-day and a week suspension upon
Katando. Katando then filed a complaint for illegal suspension before the NLRC.
Papertech reiterated her transfer to its Makati office. Thereafter, Papertech issued a notice to Katando
requiring her to explain her refusal to receive the memorandum. Despite submitting her explanation,
Papertech issued a notice dismissing Katando for her insubordination. Katando filed a complaint for
illegal dismissal, among others, against Papertech, its officers and HR.
LA Apita-Battung found Katando's suspension was illegal. LA Nicolas declared her dismissal illegal and
ordered Papertech to pay her backwages, other benefits, separation pay plus attorney's fees. The filing
of the instant case and the attempts of the Papertech to transfer the complainant have brought about
antipathy and antagonism between them, thereby resulting to strained relationship. NLRC affirmed LA.
CA granted Katando's petition and ordered Papertech to immediately reinstate her. CA ruled that the
doctrine of strained relations cannot apply to Katando as she is part of the rank and file workforce and
does not occupy a managerial or key position in the company.
ISSUE: W/N the CA erred in ordering the reinstatement of Katando instead of granting her separation
pay. – YES
HELD: Although Katando does not occupy a position of trust and confidence as a machine operator, the
circumstances of this case nonetheless calls for the application of the doctrine of strained relations. It
is true that litigation between the parties per se should not bar the reinstatement of an employee.
However, in this case, they have been in conflict since 2008, or for 11 years now. The circumstance of
the case shows that Papertech does not want Katando back as its employee.
Moreover, what remained in Papertech's Pasig City premises was its sales, marketing, and distribution
operations. Hence, CA held that the transfer of Papertech's manufacturing and production departments
to its provincial plants was valid. Katando's reinstatement as a machine operator in Papertech's Pasig
City premises is no longer possible. Thus, separation pay is the only viable option for Katando.
NOTES: The following are the considerations in applying the doctrine of strained relations:
1. The employee must occupy a position where he or she enjoys the trust and confidence of his or her
employer;
2. It is likely that if reinstated, an atmosphere of antipathy and antagonism may be generated as to
adversely affect the efficiency and productivity of the employee concerned;
3. It cannot be applied indiscriminately because some hostility is invariably engendered between the
parties as a result of litigation; and
4. It cannot arise from a valid and legal act of asserting one's right. (Globe-Mackay Cable and Radio
Corp. v. NLRC)
4F 2021-2022 60
OLYMPIA HOUSING V. LAPASTORA January 13, 2016 (reinstatement no longer
possible due to closure; grant of backwages and
separation pay to run up to date of closure)
FACTS: A complaint for illegal dismissal, payment of backwages and other benefits, and regularization
of employment filed by Lapastora and Ubalubao against Olympic Housing, Inc. (OHI), the entity engaged
in the management of the Olympia Executive Residences (OER). Lapastora and Ubalubao alleged that
they worked as room attendants of OHI until they were placed on floating status through a
memorandum sent by Fast Manpower.
Prior to their dismissal, they were subjected to investigations for their alleged involvement in the theft
of personal items and cash belonging to hotel guests and were summarily dismissed by OHI despite lack
of evidence.
Lapastora and Ubalubao were, however, found to have violated house rules and regulations and were
reprimanded accordingly. Fast Manpower denied the employees' claim that they were dismissed and
maintained they were only placed on floating status for lack of available work assignments.
During the pendency of the case, Ubalubao filed a Motion to Dismiss/Withdraw Complaint and Waiver.
ISSUE: Whether or not Lapastora was illegally dismissed. YES
HELD: Indisputably, Lapastora was a regular employee of OHI. He has been under the continuous
employ of OHI until he was placed on floating status. His uninterrupted employment by OHI, lasting for
more than a year, manifests the continuing need and desirability of his services, which characterize
regular employment.
It appears that OHI failed to prove that Lapastora's dismissal was grounded on a just or authorized
cause. While it claims that it had called Lapastora's attention several times for his infractions, it does
not appear from the records that the latter had been notified of the company's dissatisfaction over his
performance and that he was not given an opportunity to explain. Also, allegations regarding
Lapastora's involvement in the theft of personal items and cash belonging to hotel guests remained
unfounded suspicions as they were not proven.
However, reinstatement is not possible. While the finding of illegal dismissal in favor of Lapastora
subsists, his reinstatement was rendered a legal impossibility with OHI’s closure of business.
Thus, the payment of separation pay, in lieu thereof, is proper. The amount of separation pay to be
given to Lapastora must be computed from the time he commenced employment with OHI, until the
time when the company ceased operations. As a twin relief, Lapastora is likewise entitled to the
payment of backwages, computed from the time he was unjustly dismissed until when his
reinstatement was rendered impossible without fault on his part.
CLAUDIA’S KITCHEN V. TANGUIN June 28, 2017 (Separation pay in lieu of

reinstatement, when proper)
FACTS: Tanguin was a billing supervisor employed by petitioner Claudia's Kitchen, Inc. working in Manila
Jockey Club's Turf Club Building in San Lazaro Leisure and Business Park (SLLBP), Carmona, Cavite.
She claims that in October 2010, she was placed under preventive suspension by the HR Manager
because she was allegedly forcing her co-employees to buy silver jewellery from her during office hours
and inside the company premises. Tanguin admitted that she was selling silver jewelry, but she denied
that she did so during office hours. LA ruled that Tanguin's preventive suspension was justified because,
as supervisor, she was in possession of the company's cash fund and collections.
4F 2021-2022 61
When the case reached NLRC, it concluded that there was neither dismissal nor abandonment in this
case. It held that the prayer for reinstatement was not proper because such remedy was applicable
only to illegally dismissed employees.
CA, however, applied the doctrine of strained relations and ordered the payment of separation pay to
Tanguin instead of compelling the petitioners to accept her in their employ.
ISSUE: WHETHER SEPARATION PAY IN LIEU OF REINSTATEMENT MAY BE AWARDED TO AN EMPLOYEE
WHO WAS NOT DISMISSED FROM EMPLOYMENT.
HELD: No. In this case, respondent was not dismissed from employment. No sufficient evidence was
presented to show that Tanguin was terminated, except for her own allegations that she was being
barred by the security guard from entering the workplace.
Neither was there a termination by reason of Tanguin’s abandonment of her work. Abandonment is
the deliberate and unjustified refusal of an employee to resume his employment. It constitutes neglect
of duty and is a just cause for termination of employment. In this case, records are bereft of any
indication that Tanguin's failure to report for work was with a clear intent to sever her employment
relationship with the petitioners. Mere absence or failure to report for work, even after a notice to
return to work has been served, is not enough to amount to an abandonment of employment. Neither
Tanguin's act of filing a complaint for illegal dismissal with prayer for reinstatement negates any
intention to abandon her employment.
Hence, the claim for reinstatement nor separation pay in lieu of reinstatement has no basis.
Besides, payment of separation pay and reinstatement are exclusive remedies. The payment of
separation pay replaces the legal consequences of reinstatement to an employee who was illegally
dismissed.
The general rule is that separation pay in lieu of reinstatement could not be awarded to an employee
whose employment was not terminated by his employer. In this regard, it is only proper for Tanguin to
report back to work and for the petitioners to accept her, without prejudice to the on-going
investigation against her
DUMAPIS V. LEPANTO September 15, 2020

FACTS:
In an NLRC case, the LA rendered his Decision dismissing the complaint for illegal dismissal of therein
complainants. On complainant's appeal, the NLRC reversed. The CA affirmed. This Court affirmed in the
main. The decision became final and executory on November 25, 2008. The LA issued the
corresponding writ of execution in the total amount of P897,412.95. Petitioners then sought a
recomputation of this award which the LA granted. Lepanto moved to quash the writ, insisting that the
computation should be reckoned from the date of dismissal up until the NLRC rendered its Decision.
Meantime, petitioners moved for another recomputation of the monetary award to include the salary
increases allegedly granted them per the CBA.
The LA recalled his Order and further recomputed the award to include the incremental salary increase
pursuant to the CBA but only until the date when the CA issued its Decision. Petitioners asserted that
the cut-off date for the computation of the award was November 23, 2008 when this Court's Decision
became final and executory. They also argued that the monetary award should include salary
increases granted under the CBA as the same should have accrued to them had they not been illegally
terminated. Lepanto opposes the inclusion of the CBA wage increases in the computation as these
4F 2021-2022 62
increases took effect prior to petitioners' termination: and this relief was only sought for the first time
during the execution stage.
ISSUE: What is the correct formula for computing the award of separation pay and backwages to
petitioners?
HELD: The Court now ordains the uniform rule that the award of backwages and/or separation pay
due to illegally dismissed employees shall include all salary increases and benefits granted under the
law and other government issuances, Collective Bargaining Agreements, employment contracts,
established company policies and practices, and analogous sources which the employees would have
been entitled to had they not been illegally dismissed. On the other hand, salary increases and other
benefits which are contingent or dependent on variables such as an employee's merit increase based on
performance or longevity or the company's financial status shall not be included in the award.
Petitioners' backwages and separation pay here should, therefore, be computed from September 22,
2000 when they got illegally dismissed until November 25, 2008, when this Court's Decision dated
August 13, 2008 became final and executory. The legal rate of interest of twelve percent (12%) per
annum shall be computed on the total monetary award from November 25, 2008 to June 30, 2013 and
six percent (6%) per annum from July 1, 2013 until their full satisfaction.
Respondent Lepanto is ORDERED to PAY petitioners backwages and separation pay based on
petitioners' salary rates at the time of their termination, inclusive of guaranteed salary increases and
other benefits and bonuses which petitioners were entitled to receive under the law and other
government issuances, collective bargaining agreements, employment contracts, established company
policies and practices, and analogous sources had they not been illegally dismissed.
4F 2021-2022 63

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