PHILCOM EMPLOYEES UNION v. PHILIPPINE GLOBAL COMMUNICATIONS, GR NO.

144315, 2006-07-17

Facts:

Upon the expiration of the Collective Bargaining Agreement (CBA) between petitioner Philcom
Employees Union (PEU or union, for brevity) and private respondent Philippine Global Communications,
Inc. (Philcom, Inc.) on June 30, 1997, the parties started negotiations... for the renewal of their CBA in
July 1997. While negotiations were ongoing, PEU filed on October 21, 1997 with the National
Conciliation and Mediation Board (NCMB) National Capital Region, a Notice of Strike, docketed as
NCMB-NCR-NS No. 10-435-97, due to perceived unfair labor... practice committed by the company

On November 11, 1997, at a conciliation conference held at the NCMB-NCR office, the parties agreed to
consolidate the two (2) Notices of Strike filed by the union and to maintain the status quo during the
pendency of the proceedings (Annex "3", Comm

On November 17, 1997, however, while the union and the company officers and representatives were
meeting, the remaining union officers and members staged a strike at the company premises,
barricading the entrances and egresses thereof and setting up a stationary picket at the... main entrance
of the building. The fo

On November 27, 1997, the union filed a Motion for Reconsideration assailing, among others, the
authority of then Acting Secretary Trajano to assume jurisdiction over the labor dispute. Said motion
was denied in an Order dated January 7, 199

PABX transfer and contractualization of PABX service and position;

Massive contractualization;

Flexible labor and additional work/function;

PEU contends that the Secretary should not have taken cognizance of the issue on the alleged illegal
strike because it was not properly submitted to the Secretary for resolution. PEU asserts that after
Philcom submitted its position paper where it raised the issue of the... legality of the strike, PEU
immediately opposed the same by filing its Manifestation/Motion to Strike Out Portions of an

PEU also contends that, contrary to the findings of the Court of Appeals, the Secretary's assumption of
jurisdiction over the labor dispute was based on the two notices of strike that PEU filed with the NCMB.
PEU asserts that only the issues on unfair labor pra

On the alleged misimplementation and/or non-implementation of employees' benefits, such as shoe

allowance, rainboots, raincoats, OIC shift allowance, P450.00 monthly allowance, driving allowance,
motorcycle award and full-time physician, the company gave the following... explanation which this
Court finds plausible, to wit:

Issues:

also claims that Philcom has committed several unfair labor practices. PEU asserts that there are "factual
and evidentiary bases" for the charge of unfair labor practices against Philcom

Ruling:
PEU's contentions are untenable.

The Secretary properly took cognizance of the issue on the legality of the strike. As the Court of Appeals
correctly pointed out, since the very reason of the Secretary's assumption of jurisdiction was PEU's
declaration of the strike, any issue regarding the strike is not merely... incidental to, but is essentially
involved in, the labor dispute itself.

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 en

The powers granted to the Secretary under Article 263(g) of the Labor Code have been characterized as
an exercise of the police power of the State, with the aim of promoting public good.[16] When the
Secretary exercises these powers, he is granted

"Great breadth of discretion" in order to find a solution to a labor dispute. The most obvious... he
Company has been a vital part of the telecommunications industry for 73 years. It is particularly noted
for its expertise and dominance in the area of international telecommunications

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, no matter how unfair, are not unfair labor... practices.[23] The only exception is Article 248(f),
which in any case is not one of the acts specified in PEU's charge of unfair labor practice

A review of the acts complained of as unfair labor practices of Philcom convinces us that they do not fall
under any of the prohibited acts defined and enumerated in... mis-implementation or non-
implementation of employee benefits,... non-payment of overtime and other monetary claims,
inadequate transportation allowance, water, and other facilities, are all a matter of implementation or
interpretation of the economic provisions of the CBA between Philcom and PEU subject to the grievance
procedure.

On the alleged mis-implementation and/or non-implementation of employees' benefits, such as shoe

allowance, rain boots, raincoats, OIC shift allowance, P450.00 monthly allowance, driving allowance,
motorcycle award and full-time physician, the company gave the following... explanation which this
Court finds plausible, to wit:

ULP since management is at liberty, absent any... malice on its part, to abolish positions which it deems
no longer necessary

Anent the allegation of PABX transfer and contractualization of PABX service and position, these were
done in anticipation of the company to switch to an automatic PABX machine which requires no
operator. This cannot be treated as ULP since management is at liberty, absent any... malice on its part,
to abolish positions which it deems no longer necessary (Arrieta vs. National Labor Relations
Commission, 279 SCRA 326, 332). Besides, at the time the company hired a temporary employee to man
the machine during daytime, the subject position was vacant while... the assumption of the function by
the company guard during nighttime was only for a brief period.
respect to the perceived massive contractualization of the company, said charge cannot be considered
as ULP since the hiring of contractual workers did not threaten the security of tenure of regular
employees or union members. That only 160 employees out of 400 employees in... the company's
payroll were considered rank and file does not... offer or promotions to a few union members is neither
unlawful nor an economic inducement. These offers were made in accordance with the legitimate need
of the company for the services of these employees to fill positions left vacant by either retirement or...
resignation of other employees. Besides, a promotion is part of the career growth of employees found
competent in their work. Thus, in Bulletin Publishing... promotions were made near or around the time
when CBA negotiations were about to be held does not make the company's action an unfair labor
practice... union's charge that management disallowed leave of union officers and members to attend
union seminar, this is belied by the evidence submitted by the union itself. In a letter to PEU's President,
the company granted the

On the ULP issue of disinformation scheme, surveillance and interference with union affairs, these are
mere allegations unsupported by facts. The charge of "black propaganda" allegedly committed by the
company when it sup... totally baseless.

Petitioner presents no proof that it was the company which was behind the incident.

PHILCOM EMPLOYEES UNION VS PHILIPPINE GLOBAL COMMUNICATIONS and PHILCOM CORPORATION

G.R. No. 144315 July 17, 2006 Carpio, J.

Doctrine: 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, no matter how unfair, are not unfair labor practices.

Facts:  The Collective Bargaining Agreement (CBA) between petitioner Philcom Employees Union and
the respondent Philcom Corporation expired. o the parties started negotiations for the renewal of their
CBA in July 1997 o While negotiations were ongoing, PEU filed a Notice of Strike with the National
Conciliation and Mediation Board (NCMB) – National Capital Region  Ground: perceived unfair labor
practice committed by the company (a) PABX transfer and contractualization of PABX service and
position; (b) Massive contractualization; (c) Flexible labor and additional work/function; (d) Disallowance
of union leave intended for union seminar; (e) Misimplementation and/or non-implementation of
employees' benefits like shoe allowance, rainboots, raincoats, OIC shift allowance, P450.00 monthly
allowance, driving allowance, motorcycle award and full-time physician; (f) Non-payment, discrimination
and/or deprivation of overtime, restday work, waiting/stand by time and staff meetings; (g) Economic
inducement by promotion during CBA negotiation; (h) Disinformation scheme, surveillance and
interference with union affairs; (i) Issuance of memorandum/notice to employees without giving copy to
union, change in work schedule at Traffic Records Section and ITTO policies; and (j) Inadequate
transportation allowance, water and facilities." o The company, then, suspended the ongoing CBA
negotiation  Ground: bargaining deadlock o The union went for another strike  At a conciliation
conference held at the NCMB-NCR office, the parties agreed to consolidate the two (2) Notices of Strike
filed by the union and to maintain the status quo during the pendency of the proceedings o While the
union and the company officers and representatives were meeting, the remaining union officers and
members staged a strike at the company premises.  The company immediately filed a petition for the
Secretary of Labor and Employment to assume jurisdiction over the labor dispute. o Acting Labor
Secretary Trajano: enjoining any strike or lockout, whether threatened or actual, directing the parties to
cease and desist from committing any act that may exacerbate the situation/  Secretary of Labor: The
Union's Manifestation/Motion to Strike Out Portions of and Attachments in Philcom's Position Paper is
hereby denied for lack of merit. The Union's charges of unfair labor practice against the Company are
hereby dismissed.  CA: Violations of CBAs, except those gross in character, are mere grievances
resolvable through the appropriate grievance machinery or voluntary arbitration as provided in the CBAs

Issue/s:

1.) Was there an illegal strike?

2.) Was there unfair labor practice?

Held:

1.) The Strike was illegal having found that PEU's officers and members have committed illegal acts
during the strike.

2.) Those acts [enumerated] do not constitute unfair labor practices under Article 248 of the Labor Code
Ratio:

1.) On illegal strike:

 Philcom is engaged in a vital industry (in this case, Philcom is engaged with the communication
industry) protected by Presidential Decree No. 823 (PD 823), as amended by Presidential Decree No.
849, from strikes and lockouts. o the striking employees violated the no-strike policy of the State in
regard to vital industries

 The Secretary had already assumed jurisdiction over the dispute. Despite the issuance of the return-to
work orders dated 19 November and 28 November 1997, the striking employees failed to return to work
and continued with their strike.

A return-to-work order is immediately effective and executory despite the filing of a motion for
reconsideration. It must be strictly complied with even during the pendency of any petition questioning
its validity.

 PEU staged the strike in utter disregard of the grievance procedure established in the CBA. o A strike
declared on the basis of grievances which have not been submitted to the grievance committee as
stipulated in the CBA of the parties is premature and illegal.

2.) On ULP:

 Unfair labor practices of the employer are enumerated in Article 248 of the Labor Code (check your
codal, please)  In this case, do not fall under any of the prohibited acts defined and enumerated in
Article 248 of the Labor Code.  The issues of misimplementation or non-implementation of employee
benefits, non-payment of overtime and other monetary claims, inadequate transportation allowance,
water, and other facilities, are all a matter of implementation or interpretation of the economic
provisions of the CBA between Philcom and PEU subject to the grievance procedure.

The Union failed to convincingly show that there is flagrant and/or malicious refusal by the Company to
comply with the economic provisions stipulated in the CBA.  Guys, here inexplain kung bakit hindi ULP
yung acts nun employer. Medyo madami sya kung ienumerate. Examples na lang, hehe:  On
contractualization and economic inducement: the acts of said company qualify as a valid exercise of
management prerogative. It is not unfair labor practice to contract out work for reason of reduction of
labor cost through the acquisition of automatic machines.  On the union's charge that management
disallowed leave of union officers and members to attend union seminar: this is belied by the evidence
submitted by the union itself. In a letter to PEU's President, the company granted the leave of several
union officers and members to attend a seminar notwithstanding that its request to be given more
details about the affair was left unheeded by the union. Those who were denied leave were urgently
needed for the operation of the company.

Labor Congress of the Philippines (LCP) vs. NLRC, Empire Food Products, et al, G.R. No. 123938, May
21,1998

Facts: The 99 petitioners in this case were rank-and-file employees of Empire Food Products. They filed
complaints for money claims and violations of labor standards laws and another petition seeking
certification of their union as their bargaining representative. The employer and the petitioners
executed a memorandum of agreement where the employer agreed to bargain with the union over the
employees' demands. But no bargaining ever took place. Instead, the employees were dismissed
allegedly for abandoning their jobs. The employees, courageously assisted by LCP President Benigno
Navarro (a non-lawyer), complained of illegal dismissal, asked for reinstatement with back wages, and
pursued their claims for statutory benefits and damages. There was never a question that the
petitioners were employees of Empire Food Products although the issue was raised whether they were
regular employees or not. Finding the observations of the Office of the Solicitor General "most
persuasive," the Supreme Court ruled that the petitioners were indeed regular employees. Finding
likewise that their dismissal was unjustified, the Court declared them entitled to reinstatement, but,
nevertheless, awarded separation pay in lieu of reinstatement in view of strained relationship between
the parties. Back wages were also awarded but the computation would have to be done by NLRC since
the petitioners' earnings were variable because they were paid on piece-rate basis. Working as
repackers, they were paid a certain amount for every thousand pieces of cheese curls and other
products repacked. The Court, after ruling on the regular status of the petitioners and their entitlement
to back wages, next delved on their claim for statutory benefits. This pertinent portion of the decision is
reproduced below.

Ruling: As to the other benefits, namely, holiday pay, premium pay, 13thmonth pay and service
incentive leave which the labor arbiter failed to rule on but which petitioners prayed for in their
complaint, we hold that petitioners are so entitled to these benefits, xx x The Rules Implementing the
Labor Code exclude certain employees from receiving benefits such as nighttime pay, holiday pay,
service incentive leave and 13th-month pay, inter alia, "field personnel and other employees whose time
and performance is unsupervised by the employer, including those who are engaged on task or contract
basis, purely commission basis, or those who are paid a fixed amount for performing work irrespective
of the time consumed in the performance thereof." Plainly, petitioners as piece-rate workers do not fall
within this group. As mentioned earlier, not only did petitioners labor under the control of private
respondents as their employer, Downloaded by Rhodail Andrew Castro (wayeecastro01@gmail.com)
lOMoARcPSD|8202424 likewise did petitioners toil throughout the year with the fulfillment of their
quota as supposed basis for compensation. Further, in Section 8(b), Rule TV, Book III which we quote
hereunder, piece workers are specifically mentioned as being entitled to holiday pay. Sec. 8 Holiday pay
of certain employees. (b) Where a covered employee is paid by results or output, such as payment on
piece work, his holiday pay shall not be less than his average daily earnings for the last seven (7) actual
working days preceding the regular holiday: Provided, however,

That in no case shall the holiday pay be less than the applicable statutory minimum wage rate. In
addition, the Revised Guidelines on the Implementing of the 13th-Month Pay Law, in view of the
modifications to P.D. No. 851 by Memorandum Order No. 28, clearly exclude the employer of piece-rate
workers from those exempted from paying 13th- month pay, to wit: 2. Exempted Employers The
following employers are still not covered by P.D. No. 851: d. Employers of those who are paid on purely
commission, boundary or task basis, and those who are paid a fixed amount for performing specific
work, irrespective of the time consumed in the performance thereof, except where the workers are paid
on piece-rate

• basis in which case the employer shall grant the required 13th-month pay to such workers. The
Revised Guidelines as well as the Rules and Regulations identify those workers who fall under the piece-
rate category as those who are paid a standard amount for every piece or unit of work produced that is
more or less regularly replicated, without regard to the time spent in producing the same. As to
overtime pay, the rules, however, are different. According to Sec. 2(e), Rule I, Book III of the
Implementing Rules, workers who are paid by results including those who are paid on piece-work, takay,
pakiao, or task basis, if their output rates are in accordance with the standards prescribed under Sec. 8,
Rule VII, Book HI, of those regulations, or where such rates have been fixed by the Secretary of Labor in
accordance with the aforesaid section, are not entitled to receive overtime pay. Here, private
respondents did not allege adherence to the standards set forth in Sec. 8 nor with the rates prescribed
by the Secretary of Labor. As such, petitioners are beyond the ambit of exempted persons and are
therefore entitled to overtime pay. Once more, the National Labor Relations Commission would be in a
better position to determine the exact amounts owed petitioners, if any.
Golden Donuts, Inc. v. NLRC [G.R. Nos. 113666-68, January 19, 2000

FACTS: Private respondents were the complainants in three consolidated cases submitted with the
Labor Arbiter. Complainants were members of the KMDD-CFW whose CBA with the corporation expired.
During the negotiations, the management panel arrived late causing the union panel to walk out. The
management addressed a letter of apology to the union and requested for negotiations to resume. The
union panel did not show up despite letters from management advising the former of the CBA meetings.
The union struck. A complaint was filed by Golden Donuts to declare the strike illegal. Counsel for the
union and strikers pleaded for a compromise whereupon both parties would desist from continuing
their cases against each other. The Labor Arbiter rendered a decision upholding the dismissal of private
respondents and ruling that they were bound by the compromise agreement entered into by the union
with petitioners. Private respondents appealed to the NLRC, claiming that the union had no authority to
waive or compromise their individual rights and they were not bound by the compromise agreement
entered into by the union with petitioners.

ISSUE: Whether or not a union may compromise or waive the right to security of tenure and money
claims of its minority members, without the latter’s consent.

HELD: No. Absent a showing of the union’s special authority to compromise the individual claims of
private respondents for reinstatement and back wages, there is no valid waiver of the aforesaid rights.
The judgment of the Labor Arbiter based on the compromise agreement does not have the effect of res
judicata upon private respondents who did not agree thereto since the requirement of identity of
parties is not satisfied. A judgment upon a compromise agreement has all the force and effect of any
other judgment and is conclusive only upon parties thereto and their privies. Private respondents have
not waived their right to security of tenure nor can they be barred from entitlement of their individual
claims. Since there was no evidence that private respondents committed any illegal act, petitioner’s
failure to reinstate them after the settlement of the strike amounts to illegal dismissal.