Isalama Machine Works Corp vs. Hon. Labor Relations Commission

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G.R. No. 100167 March 2, 1995

ISALAMA MACHINE WORKS CORPORATION, petitioner,
vs.
HON. LABOR RELATIONS COMMISSION, FIFTH DIVISION and ISALAMA MACHINE WORKS CORPORATION LABOR UNION-WORKERS ALLIANCE TRADE UNION AND/OR HENRY BAYGAN, NATHAN PURACAN, GREGORIO LAYSON, JR., NANDY VIRTUDAZO, JIMMY SACRO, CHARITO ESTRERA, DENISON AMBOAYEN, BIENVENIDO CABIL, MELCHOR MARTINEZ, FLORIDAN BILAR, NOEL LAYSON, EDISON ALMORADES, MA. CELESTINA CLEMEN, LEONCIO CUIZON, VENNIE OPORTO, RODOLFO IGNACIO and ALMIRANTE ZAGADO, respondents.

Facts:

This petition for certiorari assails the Decision, dated 09 June 1989, of the National Labor Relations Commission, Cagayan de Oro City, requiring petitioner-corporation to pay private respondents and ordering the reinstatement, without back salaries, of private respondents, with the exception of Henry Baygan.

On 25 March 1987, petitioner Isalama Machine Works Corporation and private respondent Isalama Machine Works Corporation Labor Union-Workers Alliance Trade Union entered into a collective bargaining agreement. Following the signing of the CBA, the union made repeated demands on the corporation, to furnish the workers with safety shoes and free company laminated IDs and, in general, to improve the employees' working conditions.

On 21 December 1987, the corporation paid the workers the 13th month pay based on the average number of days actually worked during the year. The union, through its president, private respondent Henry Baygan, demanded that the 13th month pay should, instead, be made on the basis of a full one month basic salary. The corporation countered that its own computation of the 13th month pay accorded with the CBA provisions and Presidential Decree No. 851.

On 05 January 1988, the union filed a notice of strike with the Department of Labor and Employment, Region X, Cagayan de Oro, alleging the commission of unfair labor practice and CBA violation by the corporation. But the National Conciliation and Mediation Board ("NCMB") succeeded in having the dispute amicably settled except for the 13th month pay differential which remained in contention. However, the corporation argued that the 13th month pay was a mere money claim and therefore not a "strikeable issue." The case was ultimately indorsed to the NLRC for compulsory arbitration.

Thus, the union still went on strike on 15 February 1988. That on 16 May 1988, the Executive Labor Arbiter rendered a decision holding the strike to be illegal and declaring Baygan and the "participating" union members to have thereby lost their employment status. The dismissed employees appealed the decision of the Executive Labor Arbiter to the NLRC and questioned decision ordering, except for Baygan, the reinstatement, without back salaries, of the dismissed union members.
The corporation filed a motion for reconsideration of the NLRC decision nut was denied for lack of merit.

Change of New Trade Name

On 23 May 1991, the union filed with the NLRC a motion for execution of the judgment, asserting additionally that the corporation was operating under the new trade name, "Golden Engineering," owned and managed by the same family, of which change neither the employees nor the NLRC had been formally notified.

On 03 June 1991, before the motion for execution could be acted upon by the NLRC, the corporation filed the instant petition. The Court issued, on 01 July 1991, a temporary restraining order enjoining respondent NLRC from implementing its 09 June 1989 decision and 30 April 1991 resolution.

Petitioner submits that private respondents cannot claim good faith in staging their strike since the attention of both parties had been called by the conciliator at the hearings before the NCMB to the "non-strikeable" character of the 13th month pay. Private respondents continue to claim, however, that the questioned 13th month pay should be considered a "strikeable issue."

Issue:

W/N the union can stage strike due to unresolved dispute on 13th month pay differentials despite of that it was stipulated in the Collective Bargaining Agreement (CBA) that during the term of this Agreement, the Company stipulates and agrees that there shall be no lockouts, and the Union in turn, as well as its officers and agents, stipulate and agree that there shall be no strike or will they authorize, instigate or engage in any work stoppage slowdown or any other form of interruption of work by the employees and laborers that may hamper or impede the operations of the business of the Company.

Ruling:

In this case, the real reason for the strike is clearly traceable to the unresolved dispute between the parties on 13th month pay differentials under Presidential Decree No. 851, i.e., the proper manner of its application and computation. The Court does not see this issue, given the aforequoted provisions of the law and its implementing rules, to be constitutive of unfair labor practice. Section 9 of Rules and Regulations Implementing Presidential Decree No. 851, in fact, specifically states that "(n)onpayment of the thirteenth-month pay provided by the Decree and (the) rules shall be treated as money claims cases and shall be processed in accordance with the Rules Implementing the Labor Code of the Philippines and the Rules of the National Labor Relations Commission."

Private respondents, indeed, showed little prudence, if at all, in their precipitate and ill-considered strike. The NLRC likewise found private respondents to have violated Art. 264 (e) of the Labor Code when they blocked and barricaded the entrance of petitioner's premises preventing free ingress and egress. Unfortunately for petitioner, however, the identity of those who committed those illegal acts during the strike, except for Baygan, had not been adequately established. Specifically, the NLRC said that no sufficient evidence could be found "to pin down the afore-named 16 respondents as having committed illegal acts during the strike," that could warrant a loss of their employment status. The dismissal of Baygan, however, was warranted. Being the union president and leader of the strike, his liability was greater than that of mere members, and he had the responsibility to ensure that his followers respected the law.

This case arose in 1988 or prior to the effectivity of Republic Act No. 6715; accordingly, the back salaries of the dismissed employee should be limited to three years, without deduction or qualification, following the rule in Maranaw Hotels and Resorts Corporation vs. Court of Appeals.

WHEREFORE, the questioned decision and resolution of the NLRC are AFFIRMED subject to the MODIFICATION that the back salaries ordered to be paid should be limited, without deduction or qualification, to only three (3) years. No costs.