A Compilation of Labor Relations Case Digests

By:
Cristine D. Bilocura
JD-III Moot Court

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March 2017

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 TABLE OF CONTENTS

I. Sarmiento V. Tuico

II. Cercado V. Uniprom Inc.

III. Milan V. Nlrc And Solid Mills Inc.

IV. Meralco V. Lim

V. Paguio V. Pldt Comp. Inc.

VI. Michael Press V. Galit

VII. Felix V. NLRC

VIII. Merin V. Nlrc

IX. Royal Plant Union V. Coca-Cola Bottlers-Cebu

Plant

X. Goya Inc. V. Goya Inc. Employees Union-Fmw

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Case No. 1

SARMIENTO V. TUICO
G.R. No. 75271-73; June 27, 1988

Facts:

Asian Transmission Corporation (ACT) terminated the

services of Sarmiento, vice-president of the Bisig ng Asian
Transmission Labor Union (BATU) for allegedly carrying a
deadly weapon in company premises. BATU filed a notice of
strike, claiming that ATC had committed an unfair labor
practice. When the conciliatory conference failed to settle
the dispute, ATC filed a petition asking the Ministry of
Labor and Employment (MOLE) to assume jurisdiction over
the matter or to certify the same to the NLRC for
compulsory arbitration. The MOLE did the latter on the
ground that the impending strike impending strike would
prejudice national interest. It also enjoined the management
from locking out the employees and the union from
declaring a strike. MOLE then directly assumed jurisdiction
and enjoined the company to accept all returning workers
(return-to-work order). This decision was set aside but later
re-adopted in a resolution, ordering the company to
reinstate the employees on payroll immediately. ATC
challenged the resolution through certiorari.

Meanwhile, three criminal complaints were filed

against petitioning workers by an officer of ATC and by the
Philippine Constabulary. They were charged with staging an
illegal strike, barricading ATCs gates and preventing entry
of workers through harassment and force (violation of the
Labor Code, coercion). Judge Tuico issued a warrant of
arrest and committed them to jail. The petitioners moved
for the lifting of the warrant and referral of the charges to

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the NLRC. Later they moved for the dismissal of the
criminal cases on the ground that they came under the
primary jurisdiction of the NLRC.

Issues:

1. Whether or not a return-to-work order may be

validly issued by the NLRC pending determination of the
legality of the strike.

2. Whether or not, pending such determination, the

criminal prosecution of certain persons involved in the
strike may be validly restrained.

Held:

1. YES. Art. 264 of the Labor Code provides that when

a labor dispute is likely to cause strikes adversely affecting
national interest, the Minister of Labor and Employment
shall assume jurisdiction over the dispute or certify the
same to the Commission for compulsory arbitration. This
shall have the effect of enjoining the intended or impending
strike or lockout, and all striking or locked out employees
shall immediately return to work and the employer shall
readmit all workers under the same terms and conditions
prevailing before the strike or lockout. ACT is an export-
oriented enterprise that generates millions of dollars per
year and employs 350 workers. Disruption in operations will
cause delay in exports, possible cancellation of contracts
with foreign importers, and will hamper the governments
economic recovery program and will affect the livelihood of
350 families. Furthermore, the return-to-work order confers
an obligation, not a mere waivable right.

When the remaining workers refused to comply with

the order and defiantly picketed to prevent resumption of

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operations, they forfeited their right to be readmitted. They
abandoned their positions and could be validly replaced.
The return-to-work order is enforced pending the
determination of the legality/illegality of the strike to
maintain the status quo. Otherwise, strikers can claim their
strike is legal and cause a standstill in the company
operations while retaining their positions and claiming
money for work not done. The order only benefits those who
actually return to work (payment for work done).

2. YES. As a general rule, the prosecution of criminal

offenses is not subject to injunction. Here, the injunction is
justified on the ground of prematurity. The acts complained
of are connected with the compulsory arbitration
proceeding. The first two complaints are captioned with
violations of the Labor Code and the third relates to the
alleged acts of coercion committed in blocking access to
ATC premises. The cases should be suspended until the
completion of the NLRC proceedings. Circular No. 15
(series of 1982) and Circular No. 9 (1986) in relation to BP
227 indicate that fiscals and government prosecutors are
required to secure clearance from the MOLE or the Office of
the President before taking cognizance of complaints for
preliminary investigation related to a labor dispute,
including coercion, physical injuries, assault, etc. Here, no
such clearance was obtained before the criminal cases were
filed.

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Case No. 2

CERCADO V. UNIPROM INC.

G.R. No. 188154; October 13, 2010

Facts:

Petitioner Lourdes A. Cercado (Cercado) worked as

ticket seller for UNIPROM, Incn at Fiesta Carnival, then
was promoted as a cashier then a clerk typist. UNIPROM
instituted an Employees Non-Contributory Retirement Plan
which provides that any participant with twenty (20) years
of service, regardless of age, may be retired at his option or
at the option of the company. However, it amended the said
plan and reserved the option to the employees qualified.

UNIPROM implemented a company-wide early

retirement program which included petitioner, who, at that
time, was 47 years old, with 22 years of continuous service
to the company. She was offered an early retirement but she
rejected the same.

UNIPROM nonetheless pursued its decision and

Cercado was no longer given any work assignment.

Cercado filed a complaint for illegal dismissal before

the Labor Arbiter (LA), alleging that UNIPROM did not have
a bona fide retirement plan, and that even if there was, she
did not consent thereto.

For its part, respondent UNIPROM averred that

Cercado was automatically covered by the retirement plan
when she agreed to the companys rules and regulations,
and that her retirement from service was a valid exercise of
a management prerogative.

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 LA ruled in favor of Cercado, and this was affirmed by
the NLRC. But the Court of Appeals (CA) reversed the
decision.

Cerdao moved for reconsideration, but was denied.

Hence, the instant recourse.

Issues:

1. Whether or not UNIPROM has a bona fide retirement plan.

2. Whether or not petitioner was validly retired pursuant

thereto.

Held:

The petition is meritorious.

1. No. Retirement is the result of a bilateral act of the parties,

a voluntary agreement between the employer and the
employee whereby the latter, after reaching a certain age,
agrees to sever his or her employment with the former.

Article 287 of the Labor Code, pegs the age for

compulsory retirement at 65 years, while the minimum age
for optional retirement is set at 60 years. An employer is,
however, free to impose a retirement age earlier than the
foregoing mandates, as a management prerogative.

It is axiomatic that a retirement plan giving the

employer the option to retire its employees below the ages
provided by law must be assented to and accepted by the
latter, otherwise, its adhesive imposition will amount to a
deprivation of property without due process of law. In
various jurisprudence cited, the retirement plans in issue
were the result of negotiations and eventual agreement

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 between the employer and the employees. The plan was
either embodied in a CBA, or established after consultations
and negotiations with the employees bargaining
representative. The consent of the employees to be retired
even before the statutory retirement age of 65 years was
thus clear and unequivocal.

Unfortunately, no similar situation obtains in the

present case. In fact, not even an iota of voluntary
acquiescence to UNIPROMs early retirement age option is
attributable to petitioner. The assailed retirement plan of
UNIPROM is not embodied in a CBA or in any employment
contract or agreement assented to by petitioner and her co-
employees. On the contrary, UNIPROMs Employees Non-
Contributory Retirement Plan was unilaterally and
compulsorily imposed on them.

2. No. Implied knowledge, regardless of duration, cannot

equate to the voluntary acceptance required by law in
granting an early retirement age option to an employer. The
law demands more than a passive acquiescence on the part
of employees, considering that an employers early
retirement age option involves a concession of the formers
constitutional right to security of tenure.

We reiterate the well-established meaning of

retirement in this jurisdiction: Retirement is the result of a
bilateral act of the parties, a voluntary agreement between
the employer and the employee whereby the latter, after
reaching a certain age, agrees to sever his or her
employment with the former.

Acceptance by the employees of an early retirement

age option must be explicit, voluntary, free, and
uncompelled. Only the implementation and execution of the
option may be unilateral, but not the adoption and

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institution of the retirement plan containing such option.
For the option to be valid, the retirement plan containing it
must be voluntarily assented to by the employees or at least
by a majority of them through a bargaining representative.

We disagree with the CAs conclusion that the

retirement plan is part of petitioners employment contract
with respondent. It must be underscored that petitioner was
hired in 1978 or 2 years before the institution of UNIPROMs
retirement plan in 1980. Logically, her employment contract
did not include the retirement plan, much less the early
retirement age option contained therein.

We also cannot subscribe to respondents submission

that petitioners consent to the retirement plan may be
inferred from her signature in the personnel action forms. It
should be noted that the personnel action forms relate to
the increase in petitioners salary at various periodic
intervals. Moreover, voluntary and equivocal acceptance by
an employee of an early retirement age option in a
retirement plan necessarily connotes that her consent
specifically refers to the plan or that she has at least read
the same when she affixed her conformity thereto.

Hence having terminated petitioner merely on the

basis of a provision in the retirement plan which was not
freely assented to by her, UNIPROM is guilty of illegal
dismissal

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Case No. 3

MILAN V. NLRC AND SOLID MILLS INC.

G.R. No. 202961; February 4, 2015

Facts:

Petitioners are employees of Solid Mills and they are

represented by their collective bargaining agent, NAFLU.
Petitioners and their families were allowed to occupy SMI
Village, a property owned by Solid Mills, this was out of
liberality and for the convenience of employees and it was
under the condition that the employees would vacate the
property anytime the company deems it fit.

In September 2003, petitioners were informed that

effective October 10, 2003, Solid Mills would cease its
operations due to serious business losses. This was
recognized by NAFLU and in their memorandum of
agreement, they agreed for a grant of separation pay less
accountabilities, accrued sick leave benefits, vacation leave
benefits, and 13th month pay to the employees.

After SMI sent the petitioners their individual notices

to vacate the SMI Village. The employees were also
required to sign a memorandum of agreement with release
and quitclaim before their vacation and sick leave benefits,
13th month pay, and separation pay would be released.
Petitioners refused to sign the documents and demanded to
be paid their benefits and separation pay.

Petitioners filed complaints before the Labor Arbiter

for alleged non-payment of separation pay, accrued sick and
vacation leaves, and 13th month pay.

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 Petitioners contention: The accrued benefits and
separation pay should not be withheld because their
payment is based on company policy and practice; 13th
month pay is based on PD 851.Their possession of Solid
Mills property is not an accountability that is subject to
clearance procedures. They had already turned over to
Solid Mills their uniforms and equipment when Solid Mills
ceased operations.

Ruling of the LA:

In favor of petitioners. SMI illegally withheld the

benefits and separation pay since these were vested to them
by law and contract. Petitioners possession should not be
construed as petitioners accountabilities that must be
cleared first before the release of benefits. Their possession
is not by virtue of any employer-employee relationship. It
is a civil issue, which is outside the jurisdiction of the Labor
Arbiter.

Solid Mills appealed to the National Labor Relations

Commission.

Ruling of the NLRC:

Reversed the decision of the LA. Petitioners failure to

vacate SMIs property, SMI was justified in withholding
their benefits and separation pay. SMI granted the
petitioners the privilege to occupy its property on account
of petitioners employment thus it also has the prerogative
to terminate such privilege. The termination of Solid Mills
and petitioners employer-employee relationship made it
incumbent upon petitioners to turn over the property to
Solid Mills.

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 NLRC denied the MR filed by petitioners. Petitioners
filed a petition for certiorari with the CA. CA dismissed the
petition and affirmed the NLRC decision. Petitioners raised
the following errors on certiorari with the Supreme Court.

Issues:

1. Whether or not the NLRC has the jurisdiction to

preliminarily determine the issue relating to property rights
arising from employee employer relationship.

2. Whether or not the payment of benefits and other monetary

claims be held in abeyance pending the compliance of
accountabilities, specifically the failure to turn over the
occupancy of the SMI Village by the employees.

Held:

1. Yes. The NLRC may determine preliminarily the rights over

a property if it is necessary to determine an issue related to
rights or claims arising from an employee employer
relationship. Stated in Art. 217, the Labor Arbiter, in his or
her original jurisdiction, and the National Labor Relations
Commission, in its appellate jurisdiction, may determine
issues involving claims arising from employer-employee
relations.

As a general rule, therefore, a claim only need to be

sufficiently connected to the labor issue raised and must
arise from an employer-employee relationship for the labor
tribunals to have jurisdiction.

The return of its properties in petitioners possession

by virtue of their status as employees is an issue that must
be resolved to determine whether benefits can be released

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 immediately. The issue raised by the employer is, therefore,
connected to petitioners claim for benefits and is
sufficiently intertwined with the parties employer-employee
relationship. Thus, it is properly within the labor tribunals
jurisdiction.

2. YES. Requiring clearance before the release of last

payments to the employee is a standard procedure among
employers, whether public or private. Clearance
procedures are instituted to ensure that the properties, real
or personal, belonging to the employer but are in the
possession of the separated employee, are returned to the
employer before the employees departure.

GR: Employers are prohibited from withholding wages

from employees. (Art. 116 prohibition on withholding of
wages and kickbacks; Art. 100 prohibition on the
diminution of benefits; Art. 113 prohibition on wage
deduction, with the exception #3 that in cases where the
employer is authorized by law or regulations issued by the
Secretary of Labor and Employment.)

Respondent Solid Mills and NAFLU, the union

representing petitioners, agreed that the release of
petitioners benefits shall be less accountability.

Accountability, in its ordinary sense, means

obligation or debt. The ordinary meaning of the term
accountability does not limit the definition of
accountability to those incurred in the worksite. As long as
the debt or obligation was incurred by virtue of the
employer-employee relationship, generally, it shall be
included in the employees accountabilities that are subject
to clearance procedures. Petitioners possession of the SMI
Village properties should, therefore, is included in the term
accountability. Solid Mills allowed the use of its property

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for the benefit of petitioners as its employees. Petitioners
were merely allowed to possess and use it out of respondent
Solid Mills liberality. The employer may, therefore, demand
the property at will.

The return of the propertys possession became an

obligation or liability on the part of the employees when the
employer-employee relationship ceased. Thus, respondent
Solid Mills has the right to withhold petitioners wages and
benefits because of this existing debt or liability.

Withholding of payment by the employer does not

mean that the employer may renege on its obligation to pay
employees their wages, termination payments, and due
benefits. The employees benefits are also not being
reduced. It is only subjected to the condition that the
employees return properties properly belonging to the
employer. This is only consistent with the equitable
principle that no one shall be unjustly enriched or
benefited at the expense of another.

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Case No. 4

MERALCO V. LIM
G.R. No. 184769; Oct. 5, 2010

Facts:

Respondent is an administrative clerk at the Manila

Electric Company (MERALCO).

An anonymous letter was posted at the door of

MERALCO imputing respondents disloyalty to the company
and calling for her to leave. Copies of the letter were also
inserted in the lockers of MERALCO linesmen.

In light of the receipt of reports that there were

accusations and threats directed against respondent from
unknown individuals and which could possibly compromise
safety and security, she was ordered transferred to another
MERALCO Sector.

Respondent appealed her transfer and requested for a

dialogue so she could voice her concerns and misgivings on
the matter, claiming that the "punitive" nature of the
transfer amounted to a denial of due process. She further
requested for the deferment of the implementation of her
transfer pending resolution of the issues she raised.

No response to her request having been received,

respondent filed a petition for the issuance of a writ of
habeas data against petitioners for the latters unlawful act
and omission consisting of their continued failure and
refusal to provide her with details or information about the
alleged report which MERALCO purportedly received
concerning threats to her safety and security amount to a

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violation of her right to privacy in life, liberty and security,
correctible by habeas data.

Issues:

(1) Whether or not the RTC has jurisdiction over the

case.

(2) Whether or not the issuance of the writ is within

the parameters expressly set forth in the Rule on the Writ of
Habeas Data.

Held:

(1) No. RTC has no jurisdiction over the case.

It is evident that respondent's reservations on the real

reasons for her transfer a legitimate concern respecting
the terms and conditions of one's employment are what
prompted her to adopt the extraordinary remedy of habeas
data. Respondent suspects that her transfer to another
place of work betrays the real intent of management and
could be a punitive move. Her posture unwittingly concedes
that the issue is labor-related. Jurisdiction over such
concerns is inarguably lodged by law with the NLRC and
the Labor Arbiters.

(2) No. The issuance of the writ is not within the

parameters expressly set forth in the Rule on the Writ of
Habeas Data.

The habeas data rule, in general, is designed to protect

by means of judicial complaint the image, privacy, honor,
information, and freedom of information of an individual. It
is meant to provide a forum to enforce one's right to the
truth and to informational privacy, thus safeguarding the
constitutional guarantees of a person's right to life, liberty,

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and security against abuse in this age of information
technology.

However, there is no showing from the facts presented

that petitioners committed any unjustifiable or unlawful
violation of respondent's right to privacy vis-a-vis the right
to life, liberty or security. To argue that petitioners' refusal
to disclose the contents of reports allegedly received on the
threats to respondent's safety amounts to a violation of her
right to privacy is at best speculative.

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Case No. 5

PAGUIO V. PLDT COMP. INC.

G.R. No. 154072; December 3, 2002

Facts:

Paguio was appointed Head of PLDTs Garnet Exchange

where he reports to respondent, Santos. At about this time,
PLDT implemented a performance assessment program
which Paguio criticized for being unfair. Despite Paguios
complaints, the assessment program continued, so he
elevated the matter to Ferido, the First Vice President.
Santos then furnished petitioner with a blank assessment
sheet with instruction to rate petitioners own performance.
Petitioner gave himself an outstanding rating based on
Garnets performance, but Santos reduced it.

Santos issued a memorandum reassigning petitioner.

Protesting the said transfer, petitioner asked Ferido for a
formal hearing on the charges against him and for the
deferment of his re-assignment. As no immediate action was
taken by respondent Ferido, petitioner elevated the matter
to Perez, Senior Executive VP and COO of PLDT.

Ferido affirmed the transfer of Paguio stating that the

reassignment is based on Santos well-founded conclusion
that petitioner is not a team player and cannot accept
decisions of management. Perez affirmed the action taken
by Ferido and explained to petitioner that his transfer was
not in the nature of a disciplinary action that required
investigation, confrontation, and evaluation and that the
same was not done in bad faith.

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 Paguio filed a complaint for illegal demotion and
damages against respondents. The Labor Arbiter dismissed
the complaint but upon appeal to NLRC, LAs decision was
reversed and petitioner was awarded P384,000.00
representing salary increase on the ground that on account
of petitioners transfer, he was assigned a functionless
position which deprived him of the opportunity to get
promoted or to be entitled to wage increase.

PLDT filed certiorari in the Court of Appeals and CA

upheld the NLRC decision with modification, deleting the
salary increase award.

Issue:

Whether or not petitioner is entitled to salary increase

during his demotion.

Held:

No. Petitioner bases his right on the fact that,

throughout his employment until his illegal transfer, he had
been consistently given by the company annual salary
increases on account of his above outstanding performance.
This particular award which petitioner is seeking is not
based on any wage order or decree but on an employees
performance during a certain period. Petitioner likens his
claim to that for backwages in illegal dismissal cases.

Backwages are granted on grounds of equity to

workers for earnings lost due to their illegal dismissal from
work. They are a reparation for the illegal dismissal of an
employee based on earnings which the employee would
have obtained, either by virtue of a lawful decree or order
or by rightful expectation. The outstanding feature of
backwages is, thus, the degree of assuredness to an

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employee that he would have had them as earnings had he
not been illegally terminated from his employment.

Petitioners claim, however, is based simply on

expectancy or his assumption that. His claim is tantamount
to saying that he had a vested right to remain as Head of
the Garnet Exchange and given salary increases simply
because he had performed well in such position, and thus
he should not be moved to any other position where
management would require his services.

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Case No. 6

MICHAEL PRESS V. GALIT

G.R. No. 153510; February 13, 2008

Facts:

Respondent was employed by petitioner R.B. Michael

Press as an offset machine operator, whose work schedule
was from 8:00 a.m. to 5:00 p.m., Mondays to Saturdays, and
he was paid PhP230 a day. During his employment, Galit
was tardy for a total of 190 times, totaling to 6,117 minutes,
and was absent without leave for a total of nine and a half
days.

On February 22, 1999, respondent was ordered to

render overtime service in order to comply with a job order
deadline, but he refused to do so. The following day,
respondent reported for work but petitioner Escobia told
him not to work, and to return later in the afternoon for a
hearing. When he returned, a copy of an Office
Memorandum was served on him, as follows:

To: Mr. Nicasio Galit

From: ANNALENE REYES-ESCOBIA

Re : WARNING FOR DISMISSAL; NOTICE

OF

HEARING

This warning for dismissal is being issued for the

following offenses:

(1) habitual and excessive tardiness

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 (2) committing acts of discourtesy, disrespect in
addressing superiors

(3) failure to work overtime after having been

instructed to do so

(4) Insubordination - willfully disobeying, defying or

disregarding company authority

The offenses youve committed are just causes for

termination of employment as provided by the Labor Code.
You were given verbal warnings before, but there had been
no improvement on your conduct.

Further investigation of this matter is required,

therefore, you are summoned to a hearing at 4:00 p.m.
today. The hearing will determine your employment status
with this company.

(SGD) ANNALENE REYES-ESCOBIA

Manager

On February 24, 1999, respondent was terminated

from employment. The employer, through petitioner
Escobia, gave him his two-day salary and a termination
letter averring that Galit was dismissed due to the following
offenses: (1) habitual and excessive tardiness; (2)
commission of discourteous acts and disrespectful conduct
when addressing superiors; (3) failure to render overtime
work despite instruction to do so; and (4) insubordination,
that is, willful disobedience of, defiance to, or disregard of
company authority.

Respondent subsequently filed a complaint for illegal

dismissal and money claims before the National Labor
Relations Commission (NLRC).

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 Respondent subsequently filed a complaint for illegal
dismissal and money claims before the National Labor
Relations Commission (NLRC) Regional Arbitration Branch
No. IV. Then, the labor arbiter rendered a decision finding
that complainant was illegally dismissed.

The petitioners elevated the case to the NLRC. The

NLRC dismissed the appeal for lack of merit.

Not satisfied with the ruling of the NLRC, petitioners

filed a Petition for Certiorari with the CA. On November 14,
2001, the CA rendered its judgment affirming with
modification the NLRCs Decision.

Then, petitioners asked for reconsideration but was

denied.

Persistent, petitioners instituted the instant petition.

Issues:

1. Whether or not the respondents tardiness can be

considered condoned by petitioners.

2. Whether or not the charge of insubordination is

meritorious.

3. Whether or not the due process was observed.

Held:

1. No, the respondents tardiness cannot be considered

condoned by petitioners.

Habitual tardiness is a form of neglect of duty. Lack of

initiative, diligence, and discipline to come to work on time
everyday exhibit the employees deportment towards work.
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Habitual and excessive tardiness is inimical to the general
productivity and business of the employer. This is especially
true when the tardiness and/or absenteeism occurred
frequently and repeatedly within an extensive period of
time.

The mere fact that the numerous infractions of

respondent have not been immediately subjected to
sanctions cannot be interpreted as condonation of the
offenses or waiver of the company to enforce company
rules. A waiver is a voluntary and intentional relinquishment
or abandonment of a known legal right or privilege. It has
been ruled that "a waiver to be valid and effective must be
couched in clear and unequivocal terms which leave no
doubt as to the intention of a party to give up a right or
benefit which legally pertains to him." Hence, the
management prerogative to discipline employees and
impose punishment is a legal right which cannot, as a
general rule, be impliedly waived.

Also, it is incumbent upon the employee to adduce

substantial evidence to demonstrate condonation or waiver
on the part of management to forego the exercise of its
right to impose sanctions for breach of company rules.

In the case at bar, respondent did not adduce any

evidence to show waiver or condonation on the part of
petitioners.

Also, the petitioners in the case at bar did not impose

any punishment for the numerous absences and tardiness of
respondent. Thus, said infractions can be used collectively
by petitioners as a ground for dismissal.

Respondent is admittedly a daily wage earner and

hence is paid based on such arrangement. For said daily

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paid workers, the principle of "a days pay for a days work"
is squarely applicable. Hence it cannot be construed in any
wise that such nonpayment of the daily wage on the days he
was absent constitutes a penalty.

2. Yes, the charge of insubordination is meritorious.

For willful disobedience to be a valid cause for

dismissal, these two elements must concur: (1) the
employees 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 the present case, there is no question that

petitioners order for respondent to render overtime service
to meet a production deadline complies with the second
requisite. Art. 89 of the Labor Code empowers the employer
to legally compel his employees to perform overtime work
against their will to prevent serious loss or damage.

In the present case, petitioners business is a printing

press whose production schedule is sometimes flexible and
varying. It is only reasonable that workers are sometimes
asked to render overtime work in order to meet production
deadlines.

The fact that respondent refused to provide overtime

work despite his knowledge that there is a production
deadline that needs to be met, and that without him, the
offset machine operator, no further printing can be had,
shows his wrongful and perverse mental attitude; thus,
there is willfulness.

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 Respondents excuse that he was not feeling well that
day is unbelievable and obviously an afterthought. He failed
to present any evidence other than his own assertion that
he was sick. Also, if it was true that he was then not feeling
well, he would have taken the day off, or had gone home
earlier, on the contrary, he stayed and continued to work all
day, and even tried to go to work the next day, thus belying
his excuse, which is, at most, a self-serving statement.

After a re-examination of the facts, we rule that

respondent unjustifiably refused to render overtime work
despite a valid order to do so. The totality of his offenses
against petitioner R.B. Michael Press shows that he was a
difficult employee. His refusal to render overtime work was
the final straw that broke the camels back, and, with his
gross and habitual tardiness and absences, would merit
dismissal from service.

3. No, the due process was not observed.

The Court held in Agabon v. NLRC:

Procedurally, (1) if the dismissal is based on a just

cause under Article 282, 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 under Articles 283 and 284, the employer
must give the employee and the Department of Labor and
Employment written notices 30 days prior to the effectivity
of his separation.

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 Under the twin notice requirement, the employees
must be given two (2) notices before his employment could
be terminated: (1) a first notice to apprise the employees of
their fault, and (2) a second notice to communicate to the
employees that their employment is being terminated. Not
to be taken lightly of course is the hearing or opportunity
for the employee to defend himself personally or by counsel
of his choice.

In King of Kings Transport v. Mamac, the court had the

occasion to further elucidate on the procedure relating to
the twin notice and hearing requirement, thus:

(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.

28
 (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.

In addition, if the continued employment poses a

serious and imminent threat to the life or property of the
employers or of other employees like theft or physical
injuries, and there is a need for preventive suspension, the
employers can immediately suspend the erring employees
for a period of not more than 30 days. Notwithstanding the
suspension, the employers are tasked to comply with the
twin notice requirement under the law. The preventive
suspension cannot replace the required notices. Thus, there
is still a need to comply with the twin notice requirement
and the requisite hearing or conference to ensure that the
employees are afforded due process even though they may
have been caught in flagrante or when the evidence of the
commission of the offense is strong.

29
 On the surface, it would seem that petitioners
observed due process (twin notice and hearing
requirement): On February 23, 1999 petitioner notified
respondent of the hearing to be conducted later that day. On
the same day before the hearing, respondent was furnished
a copy of an office memorandum which contained a list of
his offenses, and a notice of a scheduled hearing in the
afternoon of the same day. The next day, February 24, 1999,
he was notified that his employment with petitioner R.B.
Michael Press had been terminated.

A scrutiny of the disciplinary process undertaken by

petitioners leads the court to conclude that they only paid
lip service to the due process requirements.

The undue haste in effecting respondents termination

shows that the termination process was a mere simulation
the required notices were given, a hearing was even
scheduled and held, but respondent was not really given a
real opportunity to defend himself; and it seems that
petitioners had already decided to dismiss respondent from
service, even before the first notice had been given.

Anent the written notice of charges and hearing, it is

plain to see that there was merely a general description of
the claimed offenses of respondent. The hearing was
immediately set in the afternoon of February 23, 1999the
day respondent received the first notice. Therefore, he was
not given any opportunity at all to consult a union official or
lawyer, and, worse, to prepare for his defense.

Regarding the February 23, 1999 afternoon hearing, it

can be inferred that respondent, without any lawyer or
friend to counsel him, was not given any chance at all to
adduce evidence in his defense. At most, he was asked if he
did not agree to render overtime work on February 22, 1999

30
and if he was late for work for 197 days. He was never given
any real opportunity to justify his inability to perform work
on those days. This is the only explanation why petitioners
assert that respondent admitted all the charges.

In the February 24, 1999 notice of dismissal,

petitioners simply justified respondents dismissal by citing
his admission of the offenses charged. It did not specify the
details surrounding the offenses and the specific company
rule or Labor Code provision upon which the dismissal was
grounded.

31
Case No. 7

FELIX v. NLRC
November 17, 2004

Facts:

Petitioner Adelino Felix was hired by the Republic

Asahi Glass Corporation as a Cadet Engineer. Sometime in
1992, Felix was offered a chance to train and qualify for the
position of Assistant Manager but he declined and waived
the opportunity to the one who was next-in-line. By Felix's
claim, he was asked by certain officers of the company to
resign and accept a separation package, failing which he
would be terminated for loss of confidence.

Felix, however, refused to resign and accept separation

benefits, drawing the officers of the company to, by his
claim, start harassing him. Thus, he was not given work and
another employee, Mr. Elmer Tacata, was assigned to take
over his post and function. Unable to withstand the manner
by which he was being treated by the company, Felix,
through his lawyer, warned the Republic Asahi Glass
Corporation about the illegality of its actions. Felix
attributed the company's harassment against him to his
being a member of the supervisory union then being
formed. The Republic Asahi Glass Corporation subsequently
terminated Felixx services for loss of trust and confidence.

Felix thus filed a complaint for illegal dismissal. The

Labor Arbiter dismissed Felix's complaint. On appeal, the
NLRC dismissed Felix's quoting extensively from the
Decision of the Labor Arbiter, dismissed petitioners
complaint for lack of merit. Petitioner moved for
reconsideration of the decision, but it was denied in a

32
resolution. The Court of Appeals likewise dismissed the
complaint.

Issue:

Whether or not the companys loss of trust and

confidence is founded on facts established by substantial
and competent evidence

Held:

No. The rule is that high respect is accorded to the

findings of fact of quasi-judicial agencies, more so in the
case at bar where both the Labor Arbiter and the NLRC
share the same findings. The rule is not however, without
exceptions one of which is when the findings of fact of the
labor officials on which the conclusion was based are not
supported by substantial evidence. The same is true when it
is perceived that far too much is concluded, inferred or
deducted from bare facts adduced in evidence.

The employers evidence, although not required to be

of such degree as that required in criminal cases i.e. proof
beyond reasonable doubt, must be substantial it must
clearly and convincingly establish the facts upon which loss
of confidence in the employee may be made to rest. In the
case at bar, the company failed to discharge this burden.

Felix was hastily dismissed by ASAHI as the former

was not given adequate time to prepare for his defense but
was peremptorily dismissed even without any formal
investigation or hearing. It is settled that where the
employee denies the charges against him, a hearing is
necessary to thresh out any doubt. The failure of the
company to give petitioner, who denied the charges against

33
him, the benefit of a hearing and an investigation before his
termination constitutes an infringement of his constitutional
right to due process.

It bears emphasis that the matter of determining

whether the cause for dismissal is justified on the ground of
loss of confidence cannot be left entirely to the employer.
Impartial tribunals do not only rely on the statement made
by the employer that there is loss of confidence unless duly
proved or sufficiently substantiated. At all events, even if all
the allegations are true, they are not of such nature to merit
the penalty of dismissal given the 14 years in service of
Felix. Dismissal is unduly harsh and grossly
disproportionate to the charges. This rule on proportionality
that the penalty imposed should commensurate to the
gravity of the offense has been observed in a number of
cases.

There being no basis in law or in fact justifying Felixs

dismissal on the basis of loss of trust and confidence, his
dismissal was illegal.

34
Case No. 8

MERIN V. NLRC
G.R. No. 171790; Oct. 17, 2008

Facts:

Petitioner was contracted by Great Southern Maritime

Services Corporation (GSM) for and in behalf of its foreign
principal, IMC Shipping, Co., Pte. Ltd., as an ordinary
seaman on board the vessel MT Selandang Permata for 10
months. Barely 3 months after he boarded the
vessel, petitioner was repatriated by the master of the
vessel. Petitioner allegedly refused to receive his
termination letter. After his arrival in Manila, he inquired
from GSM the reason for his dismissal, but allegedly none
was given to him by his local employer.

It appears that petitioner had committed several

infractions while on board the vessel. At one time, he
allegedly failed to report for work after he drank too much
alcohol at a party. He apologized for the incident, and even
submitted a letter of apology to the master of the vessel. In
another instance, the master of the vessel found petitioner
sleeping in the crews smoke room. When roused from his
slumber, the master of the vessel noticed that he had
bloodshot eyes and was in fact intoxicated.

On the same day, petitioner inquired from the Chief

Officer if he would be repatriated due to the incidents. He
claimed that he had strong connections with the Philippine
Overseas Employment Administration (POEA), warning that
should he be repatriated, the ship agent would be held
liable. This conversation was recorded in the ships logbook.

35
 The following day, the master of the vessel received a
letter-complaint from the vessels bosun and petitioners
immediate superior, narrating previous incidents of
petitioners refusal to obey his instructions without
justifiable reasons. The bosun also related that petitioner
threatened to harm him when he learned of his impending
repatriation. Petitioner was repatriated the following day.

Petitioner filed a claim for illegal dismissal before the

National Labor Relations Commission (NLRC). The case was
raffled to Labor Arbiter Antonio A. Cea who, issued a
decision declaring petitioners repatriation illegal.

On appeal, the NLRC reversed and set aside the labor

arbiters decision.

Petitioner sought reconsideration of the decision but

his motion was denied for lack of merit by the
NLRC. Thereafter, he filed a petition for certiorari before
the Court of Appeals.

The Court of Appeals denied the petition.

Issue:

1. Whether or not the dismissal is with just cause.

2. Whether or not the dismissal was done with due

process.

Held:

The petition is unmeritorious.

1. The totality of infractions or the number of violations

committed during the period of employment shall be
considered in determining the penalty to be imposed upon
an erring employee. The offenses committed by petitioner

36
 should not be taken singly and separately. Fitness for
continued employment cannot be compartmentalized into
tight little cubicles of aspects of character, conduct and
ability separate and independent of each other. While it may
be true that petitioner was penalized for his previous
infractions, this does not and should not mean that his
employment record would be wiped clean of his
infractions. After all, the record of an employee is a relevant
consideration in determining the penalty that should be
meted out since an employees past misconduct and present
behavior must be taken together in determining the proper
imposable penalty. Despite the sanctions imposed upon
petitioner, he continued to commit misconduct and
exhibit undesirable behavior on board. Indeed, the employer
cannot be compelled to retain a misbehaving employee, or
one who is guilty of acts inimical to its interests. It has the
right to dismiss such an employee if only as a measure of
self-protection. We find just cause in petitioners
termination.

2. The manner of his dismissal, however, is another

matter. Records show that petitioners employer failed to
observe the procedure prescribed in the POEA Standard
Employment Contract, which requires for a written notice of
the charges and the time and place for a formal
investigation, a hearing of the charges, and a written notice
of the penalty. Petitioner was repatriated without the
requisite notices and hearing. Such failure, however, does
not affect the propriety of his dismissal. In Agabon v.
NLRC, we ruled that when the dismissal is for just cause,
the lack of statutory due process should not nullify the
dismissal, or render it illegal, or ineffectual. However, it
warrants the payment of indemnity in the form of nominal
damages. Conformably with the Agabon case, the proper
amount for nominal damages would be of P30,000.00.
37
38
Case No. 9

ROYAL PLANT UNION V. COCA-COLA BOTTLERS-

CEBU PLANT
G.R. No. 198783; April 15, 2013

Facts:

Petitioner Coca-Cola Bottlers Philippines, Inc. (CCBPI)

is a domestic corporation engaged in the manufacture, sale
and distribution of softdrink products. It has several
bottling plants all over the country, one of which is located
in Cebu City. Under the employ of each bottling plant are
bottling operators. In the case of the plant in Cebu City,
there are 20 bottling operators who work for its Bottling
Line 1 while there are 12-14 bottling operators who man its
Bottling Line 2. All of them are male and they are members
of herein respondent Royal Plant Workers Union (ROPWU).

In 1974, the bottling operators of then Bottling Line 2

were provided with chairs upon their request. In 1988, the
bottling operators of then Bottling Line 1 followed suit and
asked to be provided also with chairs. Their request was
likewise granted. Sometime in September 2008, the chairs
provided for the operators were removed pursuant to a
national directive of petitioner. This directive is in line with
the "I Operate, I Maintain, I Clean" program of petitioner
for bottling operators, wherein every bottling operator is
given the responsibility to keep the machinery and
equipment assigned to him clean and safe. The program
reinforces the task of bottling operators to constantly move
about in the performance of their duties and
responsibilities.

The bottling operators took issue with the removal of

the chairs. Through the representation of herein
39
respondent, they initiated the grievance machinery of the
Collective Bargaining Agreement (CBA) in November 2008.
Even after exhausting the remedies contained in the
grievance machinery, the parties were still at a deadlock
with petitioner still insisting on the removal of the chairs
and respondent still against such measure. As such,
respondent sent a Notice to Arbitrate, dated 16 July 2009,
to petitioner stating its position to submit the issue on the
removal of the chairs for arbitration. Nevertheless, before
submitting to arbitration the issue, both parties availed of
the conciliation/mediation proceedings before the National
Conciliation and Mediation Board (NCMB) Regional Branch
No. VII. They failed to arrive at an amicable settlement.
They then executed a Submission Agreement which was
accepted by the Arbitration Committee on 01 October 2009.
As contained in the Submission Agreement, the sole issue
for arbitration is whether the removal of chairs of the
operators assigned at the production/manufacturing line
while performing their duties and responsibilities is valid or
not.

Ruling of the Arbtration Committee

On June 11, 2010, the Arbitration Committee rendered

a decision in favor of the Royal Plant Workers Union (the
Union).

Not contented with the Arbitration Committees

decision, CCBPI filed a petition for review under Rule 43
before the CA.

Ruling of the CA

On May 24, 2011, the CA rendered a contrasting

decision which nullified and set aside the decision of the
Arbitration Committee.

40
 The CA held, among others, that the removal of the
chairs from the manufacturing/production lines by CCBPI is
within the province of management prerogatives; that it was
part of its inherent right to control and manage its
enterprise effectively; and that since it was the employers
discretion to constantly develop measures or means to
optimize the efficiency of its employees and to keep its
machineries and equipment in the best of conditions, it was
only appropriate that it should be given wide latitude in
exercising it.

Hence, this petition.

Issues:

1. Whether or not a petition for review under Rule 43 is the

proper remedy in challenging the decision of the Voluntary
Arbitrator or Panel of Voluntary Arbitrators.

2. Whether or not the removal of the bottling operator's

chairs for CCBPI's production/manufacturing lines a valid
exercise of management prerogative.

Held:

1. Yes. A Petition for Review under Rule 43 is the proper

remedy.

CCBPI is correct. This procedural issue being debated

upon is not novel. The Court has already ruled in a number
of cases that a decision or award of a voluntary arbitrator is
appealable to the CA via a petition for review under Rule
43. The recent case of Samahan Ng Mga Manggagawa Sa
Hyatt (SAMASAH-NUWHRAIN) v. Hon. Voluntary Arbitrator
Buenaventura C. Magsalin and Hotel Enterprises of the
Philippines6 reiterated the well-settled doctrine on this
issue, to wit:

41
 In the case of Samahan ng mga Manggagawa sa Hyatt-
NUWHRAIN-APL v. Bacungan,7 we repeated the well-
settled rule that a decision or award of a voluntary
arbitrator is appealable to the CA via petition for review
under Rule 43. We held that:

"The question on the proper recourse to assail a

decision of a voluntary arbitrator has already been settled in
Luzon Development Bank v. Association of Luzon
Development Bank Employees, where the Court held that
the decision or award of the voluntary arbitrator or panel of
arbitrators should likewise be appealable to the Court of
Appeals, 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.

2. Yes. Again, the Court agrees with CCBPI on the matter.

The Court has held that management is free to

regulate, according to its own discretion and judgment, all
aspects of employment, including hiring, work assignments,
working methods, time, place, and manner of work,
processes to be followed, supervision of workers, working
regulations, transfer of employees, work supervision, lay-off
of workers, and discipline, dismissal and recall of workers.
The exercise of management prerogative, however, is not
absolute as it must be exercised in good faith and with due
regard to the rights of labor.

In the present controversy, it cannot be denied that

CCBPI removed the operators chairs pursuant to a national
directive and in line with its "I Operate, I Maintain, I Clean"

42
program, launched to enable the Union to perform their
duties and responsibilities more efficiently. The chairs were
not removed indiscriminately. They were carefully studied
with due regard to the welfare of the members of the Union.
The removal of the chairs was compensated by: a) a
reduction of the operating hours of the bottling operators
from a two-and-one-half (2 )-hour rotation period to a one-
and-a-half (1 ) hour rotation period; and b) an increase of
the break period from 15 to 30 minutes between rotations.

Apparently, the decision to remove the chairs was done

with good intentions as CCBPI wanted to avoid instances of
operators sleeping on the job while in the performance of
their duties and responsibilities and because of the fact that
the chairs were not necessary considering that the
operators constantly move about while working. In short,
the removal of the chairs was designed to increase work
efficiency. Hence, CCBPIs exercise of its management
prerogative was made in good faith without doing any harm
to the workers rights.

43
Case No. 10

GOYA INC. V. GOYA INC. EMPLOYEES UNION-FMW

G.R. No. 170054; January 21, 2013

Facts:

Goya, Inc. is a domestic corporation engaged in the

manufacture, importation, and wholesale of top quality food
products.

Said corporation hired contractual employees from

PESO Resources Development Corporation (PESO) to
perform temporary and occasional services in its factory.

This prompted respondent Goya, Inc. Employees

UnionFFW (Union) to request for a grievance conference
on the ground that the contractual workers do not belong to
the categories of employees stipulated in the existing CBA.

When the matter remained unresolved, the grievance

was referred to the NCMB for voluntary arbitration. They
agreed to submit for resolution the solitary issue of
whether or not the Company is guilty of unfair labor acts in
engaging the services of PESO, a third party service
provider, under the existing CBA, laws, and jurisprudence.

VA dismissed the Unions charge of ULP for being

purely speculative and for lacking in factual basis, but the
Company was directed to observe and comply with its
commitment under the CBA.

The Company immediately filed a petition for review

before the CA to set aside the directive to observe and
comply with the CBA commitment pertaining to the hiring
of casual employees when necessitated by business

44
 circumstances contending that such order was not covered
by the sole issue submitted for voluntary arbitration.

Issues:

1. Whether or not the Voluntary Arbitrator can decide

questions not covered by Submission Agreement.

2. Whether or not the CBA violation constitute a ULP.

3. Whether or not the act of hiring contractual employees is a

valid exercise ofmanagement prerogative.

Held:

1. Yes. First, the said ruling of the VA is interrelated and

intertwined with the sole issue to be resolved that is,
Whether or not the Company is guilty of unfair labor
practice in engaging the services of PESO, a third party
service provider, under existing CBA, laws, and
jurisprudence. Both issues concern the engagement of
PESO by the Company which is perceived as a violation of
the CBA and which constitutes as unfair labor practice on
the part of the Company.

In general, the arbitrator is expected to decide those

questions expressly stated and limited in the submission
agreement. However, since arbitration is the final resort for
the adjudication of disputes, the arbitrator can assume that
he has the power to make a final settlement. Law and
jurisprudence give the voluntary arbitrator enough leeway
of authority as well as adequate prerogative to accomplish

45
 the reason for which the law on voluntary arbitration was
created speedy labor justice.

2. No. While the engagement of PESO is in violation of the

CBA, it does not constitute unfair labor practice because it
is not characterized under the law as a gross violation of the
CBA. Violations of a CBA, except those which are gross in
character, shall no longer be treated as unfair labor
practice. Gross violations of a CBA means flagrant and/or
malicious refusal to comply with the economic provisions of
such agreement.

3. No. As repeatedly held, the exercise of management

prerogative is not unlimited; it is subject to the limitations
found in law, collective bargaining agreement or the general
principles of fair play and justice. In contracting out
services, the management must be motivated by good faith
and the contracting out should not be resorted to
circumvent the law or must not have been the result of
malicious arbitrary actions.

In the case at bench, the CBA of the parties has

already provided for the categories of the employees in the
Companys establishment. These categories of employees
particularly with respect to casual employees serve as
limitation to the Companys prerogative to outsource parts
of its operations especially when hiring contractual
employees. With the provision on casual employees, the
hiring of PESO contractual employees, therefore, is not in
keeping with the spirit and intent of their CBA.

46