GTE DIRECTORIES CORPORATION, petitioner, vs. HON.
They may object thereto, ask to negotiate thereon,
AUGUSTO S. SANCHEZ and GTE DIRECTORIES
CORPORATION EMPLOYEES UNION, respondents.
Siguion Reyna, Montecillo & Ongsiako for petitioner.
Ignacio P. Lacsina for respondent Union.
SYLLABUS
1.  LABOR AND SOCIAL LEGISLATION; LABOR RELATIONS;
COLLECTIVE BARGAINING; EMPLOYER'S PREROGATIVE TO
REGULATE ALL ASPECTS OF EMPLOYMENT; CASE AT BAR. —
In the case of San Miguel Brewery Sales Force Union (PTGWO) v.
Ople, G.R. No. 53515, 170 SCRA 25-280, this Court held that
"(e)xcept as limited by special laws, an employer is free to
regulate, according to his own discretion and judgment, all aspects
of employment, including hiring, work assignments, working
methods, time, place and manner of work, tools to be used,
processes to be followed, supervision, of workers, working
regulations, transfer of employees, work supervision, lay-off of
workers and the discipline, dismissal and recall of work . . . (NLU
vs. Insular La Yebana Co., 2 SCRA 924; Republic Savings Bank
vs. CIR, 21 SCRA 226, 235; Perfecto V. Hernandez, Labor
Relations Law, 1985 ed., p. 44.)" In the case at bar, it must thus be
conceded that its adoption of a new "Sales Evaluation and
Production Policy" was within its management prerogative to
regulate, according to its own discretion and judgment, all aspects
of employment, including the manner, procedure and processes by
which particular activities should be done.
2.  ID.; ID.; ID.; ID.; EMPLOYEES CANNOT DISREGARD OR
DISOBEY RULES OF MANAGEMENT UNLESS THEY HAVE
BEEN DECLARED ILLEGAL OR IMPROPER. — To sanction
disregard or disobedience by employees of a rule or order laid
down by management, on the pleaded theory that the rule or order
is unreasonable, illegal, or otherwise irregular for one reason or
another, would be disastrous to the discipline and order that it is in
the interest of both the employer and his employees to preserve
and maintain in the working establishment and without which no
meaningful operation and progress is possible. Deliberate
disregard or disobedience of rules, defiance of management
authority cannot be countenanced. This is not to say that the
employees have no remedy against rules or orders they regard as
unjust or illegal.
bring proceedings for redress against the employer before the
Ministry of Labor. But until and unless the rules or orders are
declared to be illegal or improper by competent authority, the
employees ignore or disobey them at their peril. It is impermissible
to reverse the process: suspend enforcement of the orders or rules
until their legality or propriety shall have been subject of
negotiation, conciliation, or arbitration.
3.  ID.; ID.; ID.; ID.; ID.; TERMINATION OF EMPLOYMENT ON
GROUND OF CONTINUED DEFIANCE OF EMPLOYER'S
AUTHORITY, PROPER. — When the strike notice was filed by the
union, the chain of events which culminated in the termination of
the 14 salespersons' employment was already taking place, the
series of defiant refusals by said sales representatives to comply
with GTE's requirement to submit individual reports was already in
progress. At the time, no less three (3) of the ultimate six (6) direct
orders of the employer for the submission of the reports had
already been disobeyed. The filing of the strike notice, and the
commencement of conciliation activities by the Bureau of Labor
Relations did not operate to make GTE's orders illegal or
unenforceable so as to excuse continued non-compliance
therewith. It does not follow that just because the employees or
their union are unable to realize or appreciate the desirability of
their employer's policies or rules, the latter were laid down to
oppress the former and subvert legitimate union activities. Indeed,
the overt, direct, deliberate and continued defiance and disregard
by the employees of the authority of their employer left the latter
with no alternative except to impose sanctions. The sanction of
suspension having proved futile, termination of employment was
the only option left to the employer.
4.  ID.; NATIONAL LABOR RELATIONS COMMISSION;
JURISDICTION; DISPUTE IN INSTANT CASE IS NOT ONE
ADVERSELY AFFECTING NATIONAL INTEREST. — The
production and publication of telephone directories, which is the
principal activity of GTE, can scarcely be described as an industry
affecting the national interest. GTE is a publishing firm chiefly
dependent on the marketing and sale of advertising space for its
not inconsiderable revenues. Its services, while of value, cannot be
deemed to be in the same category of such essential activities as
"the generation or distribution of energy" or those undertaken by
"banks, hospitals, and export-oriented industries." It cannot be
regarded as playing as vital a role in communication as other mass
media. The small number of employees involved in the dispute, the
employer's payment of "P10 million in income tax alone to the
Philippine government," and the fact that the "top officers of the
union were dismissed during the conciliation process," obviously
do not suffice to make the dispute in the case at bar one "adversely
affecting the national interest."
DECISION
NARVASA, J p:
GTE Directories Corporation (hereafter, simply GTE) is a foreign
corporation engaged in the Philippines in the business of
publishing the PLDT (Philippine Long Distance Telephone
Company) telephone directories for Metro Manila and several
provinces. LLphil
The record shows that initially, the practice was for its sales
representatives to be given work assignments within specific
territories by the so-called "draw method." These sales territories
were so plotted or mapped out as to have "an equal number of
advertisers as well as . . . revenue . . ." Within these territories, the
sales representatives therein assigned were given quotas; i.e.,
they had to "achieve a certain amount of revenue or
advertisements sold, decreased, increased or cancelled within a
given period of time."
A territory was not fully released to the salesperson for handling at
one time, but assigned in increments or partial releases of account.
Now, increments were given by the so-called "Grid System," grids
(divisions or sections) within each territory usually numbering five
(i.e., Grids I to V). Each grid was assigned a fixed closing dated. At
such closing date, a salesperson should have achieved a certain
amount of the revenue target designated for his grid; otherwise, he
loses the forthcoming grid or forfeits the remaining grids not yet
received. The Grid System was installed for the following reasons:
(1) to give all salespersons an opportunity to contact advertisers
within a reasonable period; (2) to assure GTE that it will get its
share of advertising budget from clients as early as possible; and
(3) to ensure an even flow of work throughout the company. LLpr
This practice was observed from 1980 until sometime in June,
1984 when GTE realized that competition among media for a share
of the advertising revenue had become so keen as to require quick
reaction. GTE therefore launched an aggressive campaign to get
what it considered to be its rightful share of the advertising budget
of its clientele before it could be allocated to other media
(newspaper, television, radio, etc.) It adopted a new strategy by
which:
(1)  all its sales representatives were required, as in the past, to
achieve specified revenue targets (advertisements sold) within pre-
determined periods;
(2)  in cases of cancelled revenue accounts or advertisements, it
required all its salespersons to re-establish contact and renew the
same within a fixed period;
(3) if the cancelled revenue accounts were not renewed within the
assigned period, said accounts were declared, for a set period,
OPEN TERRITORY to all sales representatives including the one
who reported the cancellation;
(4) if not renewed during said open territory period, said cancelled
accounts were deemed no longer "open territory," and the same
could be referred for handling to contractual salespersons and/or
outside agencies.
A new "Sales Evaluation and Production Policy" was thereafter
drawn up. GTE informed all its sales representatives of the new
policy in a Memorandum dated October 12, 1984. The new policy
was regarded as an improvement over the previous Sales
Production Policy, which solely considered quota attainment and
handling in the Sales Report for the purpose of evaluating
performance.
It appears that the new policy did not sit well with the union. It
demanded that it be given 15 days "to raise questions or objections
to or to seek reconsideration of the sales and administrative
practices issued by the Company on June 14, 1984." This, GTE
granted, and by letter dated October 26, 1984, the union submitted
its proposals for "revisions, corrections and deletions of some
policies incorporated in the Sales Administrative Practices issued
on June 14, 1984 including the new policies recently promulgated
by Management."
GTE next formulated a new set of "Sales Administrative Practices," which (they) believe is the purpose of your discriminate and
pursuant to which it issued on July 9, 1985, a memorandum whimsical memo."
requiring all Premise Sales Representatives (PSRs) to submit The following day, on August 6, 1985, the union filed in behalf of
individual reports reflecting target revenues as of deadlines, set at the sales representatives, a notice of strike grounded on alleged
August 2, 1985. This was superseded by another memorandum unfair labor practices of GTE consisting of the following:
dated July 16, 1985, revising the previous schedules on the basis "1.  Refusal to bargain on unjust sales policies
of "the consensus reached after several discussions with your particularly on the failure to meet
DSMs, as well as, most of you," and pointing out that "the amount the 75% of the average sales
required on the 1st deadline (P30,000) . . . has been reduced production for two consecutive
further (to P20,000) having taken into consideration that most of years;
your accounts you have already on hand are with your respective
'prep artists.'"
On August 5, 1985, GTE's Sales Manager sent another
Memorandum to "all premise sales personnel." That memorandum
observed that most of them had omitted to submit reports 2. Open territory of accounts;
regarding "the target of P20,000.00 revenue handled on . . . (the)
first Grid deadline of August 2, 1985" notwithstanding that "several
consultations/discussions . . . (had) been held with your DSMs, as
well as yourselves in different and separate occasions," and "these
schedules/targets were drawn up by no less than you, collectively," 3.  Illegal suspension of Brian Pineda, a union
and notwithstanding that "this has been a practice of several officer; and
years." It closed with the expressed expectation that the sales
reports would be submitted "no later than 2:00 P.M. reflecting
P20,000.00 revenue handled, as per memo re: Grid Deadlines
dated July 16, 1985."
  4.  Non-payment of eight days' suspension pay
But as before, the sales representatives did not submit the reports. increase."
Instead their union, GTE Directories Corporation Employees Union
(hereafter, simply the union), sent a letter to the Sales Manager
dated August 5, 1985. 1 The letter stated that in fact "only one out
of nineteen sales representatives met the P20,000 revenue
handled on our first grid deadline of August 2;" that the schedule In due course, the Bureau of Labor Relations undertook to
was not "drawn (up) as a result of an agreement of all concerned" conciliate the dispute.
since GTE had failed to get "affirmative responses" from "clustered On the same day, August 6, 1985, GTE sent still another
groups of SRs;" that the union could not "comprehend how memorandum to sixteen (16) of its premise sales representatives,
cancelling non-cancelling accounts help production;" and that its this time through its Director for Marketing & Sales, requiring
members would fail "expectations of cancelling . . . non-cancelling submission of "individual reports reflecting target revenues as of
accounts" since it "would result to further reduction of our pay grid deadlines . . . not later than 4:00 P.M . . . " 2 No compliance
was made. GTE thereupon suspended its sales representatives
"without pay effective August 12,1985 for five (5) working days" imposition of sanctions by GTE on its employees, and the strike
and warned them that their failure to submit the requisite reports by itself. When these proved futile, Acting Labor Minister Vicente
August 19, 1985 would merit "more drastic disciplinary actions." Leogardo, Jr. issued an Order dated December 6, 1985 assuming
Still, no sales representative complied with the requirement to jurisdiction over the dispute. The order made the following
submit the reports ("list of accounts to be cancelled"). So, by disposition, to wit:
memorandum of the Marketing Director dated August 19, 1985, all "WHEREFORE, this Office hereby assumes
the sales representatives concerned were suspended anew jurisdiction over the labor dispute at
"effective August 20, 1985 until you submit the . . . (report)." G.T.E. Directories, pursuant to
Finally, GTE gave its sales representatives an ultimatum. By Article 264 (g) of the Labor Code of
memorandum dated August 23, 1985, individually addressed to its the Philippines, as amended.
sales representatives, GTE required them, for the last time, to Accordingly, all striking workers
submit the required reports ("list of accounts to be cancelled") including those who were
within twenty-four (24) hours from receipt of the memorandum; dismissed during the conciliation
otherwise, they would be terminated "for cause." Again not one proceedings, except those who
sales representatives submitted a report. Instead, on August 29, have already resigned, are hereby
1985, the Union President sent an undated letter to GTE directed to return to work and the
(addressed to its Director for Marketing & Sales) acknowledging management of G.T.E. Directories
receipt of the notice of their suspension on August 19, 1985 in view to accept all returning employees
of their "'continued refusal to submit the list of accounts to be under the same terms and
cancelled,'" professing surprise at being "served with a conditions prevailing previous to
contradictory notice, giving us this time 24 hours to submit the the strike notice and without
required list, without the suspension letter, which we consider as prejudice to the determination of
still in force, being first recalled or withdrawn," asking that they be the obligation and rights of the
informed which of the two directives should be followed, and parties or to the final outcome of
reserving their "right to take such action against you personally for this dispute. The Bureau of Labor
your acts of harassment and intimidation which are clearly Relations is hereby directed to hear
designed to discourage our legitimate union activities in protesting the dispute and submit its
management's continuous (sic) unfair labor practices." recommendations within 15 days
Consequently, by separate letters dated August 29, 1985 upon submission of the case for
individually received, GTE terminated the employment of the resolution.
recalcitrant sales representatives, numbering fourteen, with the
undertaking to give them "separation pay, upon proper clearance
and submission of company documents, material etc., in . . . (their)
possession." Among those dismissed were the union's president
and third vice president, and several members of its board of All concerned including the military and police
directors. On September 2, 1985, the union declared a strike in authorities are hereby requested to
which about 60 employees participated. LLjur assist in the implementation of this
During all this time, conciliation efforts were being exerted by the Order."
Bureau of Labor Relations, including attempts to prevent the
The Acting Secretary opined that the dispute "adversely affects the
national interest," because:
1) GTE, a "100% foreign owned" company, had,
as publisher of "PLDT's Metro
Manila and provincial
directories . . . earned a total of
P127,038,463 contributing close to
P10 million in income tax alone to
the Philippine government," and
that "major contribution to the
national economy . . . (was) being
threatened because of the . . .
strike;" and
2)  "top officers of the union were dismissed
during the conciliation process
thereby compounding the dispute,"
Reconsideration of this Order was sought by GTE by motion filed
on December 16, 1985, on the ground that —
1)  "the basis for assumption of jurisdiction is
belied by the facts and records of
the case and hence, unwarranted;"
2)  "national interest is not adversely affected to
warrant assumption of jurisdiction
by (the) Office of the Minister of
Labor and Employment;" and
3)  "assumption of jurisdiction by the . . .
Minister . . . without prior
consultation with the parties
violates the company's right to due
process of law."
GTE however reiterated its previously declared "position
that with or without the order now being questioned, it
will accept all striking employees back to work except
the fourteen (14) premise sales representatives who
were dismissed for cause prior to the strike."
By Resolution of then Labor Minister Blas Ople dated January 20,
1986, GTE's motion for reconsideration was denied. The order
noted inter alia that GTE had "accepted back to work all the
returning workers except fourteen (14) whom it previously
dismissed insisting that they were legally dismissed for violation of
company rules and, therefore, are not included and may not be
reinstated on the basis of a return-to-work order," and that "they
were dismissed for their alleged failure to comply with the
reportorial requirement under the Sales and Administrative
Practices in effect since 1981 but which for the present is the
subject of negotiations between the parties." The Order then —
1)  adverted to the "general rule (that)
promulgations of company policies
and regulations are basic
management prerogatives although
the principle of collective bargaining
encompasses almost all relations
between the employer and its
employees which are best threshed
out through negotiations, . . . (and
that) it is recognized that company
policies and regulations are, unless
shown to be grossly oppressive or
contrary to law, generally binding
 and valid on the parties until finally
revised or amended unilaterally or
preferably through negotiations or
by competent authorities;"
2)  affirmed the "recognized principle of law that
company policies and regulations
are, unless shown to be grossly
oppressive or contrary to law,
generally binding (and) valid on the
parties and must be complied with
until finally revised or amended
unilaterally or preferably through
negotiations or by competent
authorities;" and
3)  closed by pointing out that "as a basic
principle, the matter of the
acceptability of company policies
and rules is a proper subject of
collective negotiations between the
parties or arbitration if necessary."
In a clarificatory Order dated January 21, 1986, Minister Ople
reiterated the proposition that "promulgations of company policies
and regulations are basic management prerogatives," and that "
unless shown to be grossly oppressive or contrary to law," they are
"generally binding and valid on the parties and must be complied
with until finally revised or amended unilaterally or preferably,
through negotiations or by competent authorities."
Adjudication of the dispute on the merits was made on March 31,
1986 by Order of Minister Ople's successor, Augusto Sanchez. The
Order —
1) pointed out "that the issue central to the labor
dispute . . . revolves around
compliance with existing company
policies, rules and regulations
specifically the sales evaluation
and production policy which was
amended by the October 12, 1984
memorandum and the grid
schedule;"
2)  declared that because fourteen (14) sales
representatives — who after
reinstatement pursuant to the order
of January 20, 1986 had been
placed "on forced leave with pay —
"were actually dismissed for failure
to comply with the reporting
requirements under the 'Sales
Administration Practices' which was
(sic) then the subject of
negotiations between the parties at
the Bureau of Labor Relations," it
was only fair that they "be
reinstated . . . with back wages
since they were terminated from
employment based on a policy . . .
still being negotiated to avoid
precisely a labor-management
dispute from arising" therefrom;"
 
3)  pronounced the union's action relative to the
allegedly illegal dismissal of one
Brian Pineda to be "barred by
extinctive prescription" in
accordance with the CBA then in
force; and
4)  on the foregoing premises adjudicated the
dispute as follows:
"1.  The union and management of G.T.E.
Directories Corporation
are directed to negotiate
and effect a voluntary
settlement on the
questioned Grid
schedule, the Sales
Evaluation and
Production Policy;
2.  Management is ordered to reinstate the
fourteen (14) employees
with full back wages from
the time they were
dismissed up to the time
that they were on forced
leave with pay."
Both the Union and GTE moved for reconsideration of the Order.
The Union contended that:
1)  GTE should have been adjudged guilty of
unfair labor practice and other
unlawful acts;
2) its strike should have been declared lawful;
3)  GTE's so-called "bottom-third" policy, as well
as all sales and administrative
practices related thereto, should
have been held illegal; and
4)  GTE should have been commanded: (a) to
pay all striking employees their
usual salaries, allowances,
commission and other emoluments
corresponding to the period of their
strike; (b) to release to its
employees the 8-days pay increase
unlawfully withheld from them; (c)
to lift the suspension imposed on
Brian Pineda and restore to him the
pay withheld corresponding to the
 suspension period; (d) to pay the
sales representatives all their lost
income corresponding to the period
of their suspensions, and dismissal,
including commissions that they
might have earned corresponding
to their one-week forced leave.
GTE, for its part, argued that the termination of the employment of
its fourteen (14) premise sales representatives prior to the strike
should have been upheld. It also filed an opposition to the union's
motion for reconsideration.
The motions were resolved in a "Decision" handed down by
Minister Sanchez on June 6, 1986. The Minister stated that he saw
no need to change his rulings as regards Pineda's suspension, the
question on GTE's sales and administrative policies, and the
matter of back wages. However, as regards "the other issues
raised by the union," the Minister agreed "with the company that
these were not adequately threshed out in the earlier proceedings .
. . (for) (w)hile it is true that the union had already presented
evidence to support its contention, the company should be given
the opportunity to present its own evidence." Accordingly, he
directed the Bureau of Labor Relations to hear said other issues
r a i s e d b y t h e u n i o n a n d t o s u b m i t i t s fi n d i n g s a n d
recommendations thereon within 20 days from submission of the
case for decision." prcd
Again GTE moved for reconsideration; again it was rebuffed. The
Labor Minister denied its motion by Order dated October 1, 1986.
In that order, the Minister, among other things —
1)  invoked Section 6, Rule XIII of the Rules and Regulations
Implementing the Labor Code, pertinently reading as follows:
"During the proceedings, the parties shall not do
any act which may disrupt or
impede the early settlement of the
dispute. 'They are obliged, as part
of their duty to bargain collectively
in good faith, to participate fully and
promptly in the conciliation
proceedings called by the Bureau
or the Regional Office."
and pointed out that "in dismissing 14 salesmen . . . for
alleged violations of the reportorial requirements of its
sales policies which was then the subject of
conciliation proceedings between them, (GTE) acted
evidently in bad faith; hence the status quo prior to
their dismissal must be restored . . ., (and) their
reinstatement with backwages is in order up to the
time they were on forced leave, . . ."
2) declared that because he had "ordered the parties to negotiate
and effect a voluntary settlement of the questioned Grid Schedule,
the Sales Evaluation and Productions Policy, it would be unripe
and premature for us to rule on the legality or illegality on the
company's sales policies at this instance;"
3) opted, however, to himself resolve "the so-called 'other issues'"
which he had earlier directed the Bureau of Labor Relations to first
hear and resolve (in the Decision of June 6, 1986, supra), i.e.,
GTE's liability for unfair labor practice, the legality of the strike and
the strikers' right to be paid their wages while on strike, his ruling
thereon being as follows:
"While the company, in merely implementing its
challenged sales policies did not
ipso facto commit an unfair labor
practice, it did so when it in mala
fi d e d i s m i s s e d t h e f o u r t e e n
salesmen, all union members, while
conciliation proceedings were being
conducted on disputes on its very
same policies, especially at that
time when a strike notice was filed
on the complaint of the union
 alleging that said sales policies are
being used to bust the union; thus
precipitating a lawful strike on the
part of the latter. A strike is legal if it
was provoked by the employer's
failure to abide by the terms and
conditions of its collective
bargaining agreement with the
union, by the discrimination
employed by it with regard to the
hire and tenure of employment, and
the dismissal of employees due to
union activities as well as the
company's refusal to bargain
collectively in good faith (Cromwell
Commercial Co., Inc. vs. Cromwell
Employees-and Laborers Union, 19
SCRA 398). The same rule applies
if employer was guilty of bad faith
delay in reinstating them to their
position (RCPI vs. Phil.
Communications Electronics &
Electricity Workers Federation, 58
SCRA 762).
"While as a rule strikers are not entitled to
backpay for the strike period (J.P.
Heilbronn Co. vs. NLU, 92 Phil.
575) strikers may be properly
awarded backwages where the
strike was precipitated by union
busting activities of the employer
(Davao Free Workers, Front, et al.
vs. CIR, 60 SCRA 408), as in the
case at bar . . ."
The Minister accordingly annulled and set aside his
order for the Bureau of Labor Relations to conduct
hearings on said issues since he had already
resolved them, and affirmed his Order of March 31,
1986 —"directing Union and Management to
negotiate a voluntary settlement on the company
sales policies and reinstating the fourteen employees
with full backwages from the time they were
dismissed up to the time they were on forced leave
with pay" — "but with the modification that
management . . . (was) directed to give the striking
workers strike duration pay for the whole period of the
strike less earnings."
GTE thereupon instituted the special civil action of certiorari at bar
praying for invalidation, because rendered with grave abuse of
discretion, of the Labor Minister's orders —
1)  commanding "reinstatement of the fourteen dismissed
employees", and
2) "finding . . . (it) guilty of unfair labor practice and directing . . . (it)
to pay strike duration pay to striking workers."
It seems to the Court that upon the undisputed facts on record,
GTE had cause to dismiss the fourteen (14) premise sales
representatives who had repeatedly and deliberately, not to say
defiantly, refused to comply with its directive for submission of
individual reports on specified matters. The record shows that GTE
addressed no less than (six) written official communications to said
premise sales representatives embodying this requirement, to wit:
1)  Memorandum of July 9,1985 pursuant to GTE's "Sales
Administrative Practices" — superseded by a memorandum dated
July 16, 1985 — requiring submission of individual reports by
August 2, 1985;
2)  Memorandum of August 5, 1985, requiring submission of the
reports by 2:00 P.M.;
3)  Memorandum of August 6, 1985, for submission of requisite
reports not later than 4:00 P.M. of that day, with a warning of
"appropriate disciplinary action;"
4)  Letter of August 9, 1985 imposing suspension without pay for directly to wholesalers through San
five (5) working days and extending the period for submission of Miguel's sales offices.
reports to August 19, 1985;
5) Letter of August 19, 1985 suspending the sales representatives
until their submission of the required reports;
6) Letter dated August 28, 1985 giving the sales representatives "a
last chance to comply with . . . (the) directive within 24 hours from The labor union (herein petitioner) filed a
receipt . . .;" with warning that failure to comply would result in complaint for unfair labor practice in
termination of employment. the Ministry of Labor, with a notice
The only response of the sales representatives to these formal of strike on the ground that the
directives were: CDS was contrary to the existing
1) a letter by their Union to GTE's Sales Manager dated August 5, marketing scheme whereby the
1985 in which the requirement was criticized as not being the Route Salesmen were assigned
"result of an agreement of all concerned," and as specific territories within which to
incomprehensible, "discriminate and whimsical;" sell their stocks of beer, and
2) a strike notice filed with the Ministry of Labor on August 6, 1985; wholesalers had to buy beer
and products from them, not from the
3)  an undated letter sent to GTE's Director for Marketing & Sales company. It was alleged that the
on August 29, 1985, drawing attention to what it deemed new marketing scheme violates . . .
contradictory directives, and reserving the right to take action (a provision) of the collective
against the manager for "acts of harassment and intimidation . . . bargaining agreement because the
clearly designed to discourage our legitimate union activities in introduction of the CDS would
protesting management's continuous unfair labor practices." reduce the take-home pay of the
The basic question then is whether or not the effectivity of an salesmen and their truck helpers
employer's regulations and policies is dependent upon the for the company would be unfairly
acceptance and consent of the employees thereby sought to be competing with them."
bound; or otherwise stated, whether or not the union's objections
to, or request for reconsideration of those regulations or policies
automatically suspend enforcement thereof and excuse the
employees' refusal to comply with the same.
This Court has already had occasion to rule upon a similar issue.  
The issue was raised in a 1989 case, G.R. No. 53515, San Miguel
Brewery Sales Force Union (PTGWO) v. Ople. 3 In that case, the
facts were briefly as follows:
"In September 1979, the company introduced a
marketing scheme known as the The Labor Minister found nothing to suggest that the employer's
'Complementary distribution unilateral action of inaugurating a new sales scheme "was
system' (CDS) whereby its beer designed to discourage union organization or diminish its
products were offered for sale influence;" that on the contrary, it was "part of its overall plan to
improve efficiency and economy and at the same time gain profit to designed towards that goal. In
the highest;" that the union's "conjecture that the new plan will sow Abbott Laboratories vs. NLRC, 154
dissatisfaction from its rank is already a pre-judgment of the plan's SCRA 713, We ruled:
viability and effectiveness, . . . like saying that the plan will not work
out to the workers' (benefit) and therefore management must adopt
a new system of marketing." The Minister accordingly dismissed
the strike notice, although he ordered a slight revision of the CDS,
which the employer evidently found acceptable. LexLib '. . . Even as
This Court approved of the Minister's findings, and declared correct the law is solicitous of
his holding that the CDS was "a valid exercise of management the welfare of the
prerogatives," 4 viz.: employees, it must also
"Except as limited by special laws, an employer protect the right of an
is free to regulate, according to his employer to exercise
own discretion and judgment, all what are clearly
aspects of employment, including m a n a g e m e n t
hiring, work assignments, working prerogatives. The free
methods, time, place and manner will of management to
of work, tools to be used, conduct its own business
processes to be followed, affairs to achieve its
supervision of workers, working purpose cannot be
regulations, transfer of employees, denied.'
work supervision, lay-off of workers
and the discipline, dismissal and
recall of work . . . (NLU vs. Insular
La Yebana Co., 2 SCRA 924;
Republic Savings Bank vs. CIR, 21 So long as a company's management
SCRA 226, 235.)' (Perfecto V. prerogatives are exercised in good
Hernandez, Labor Relations Law, faith for the advancement of the
1985 ed., p. 44.) (Emphasis employer's interest and not for the
supplied.)" purpose of defeating or
circumventing the rights of the
employees under special laws or
under valid agreements, this Court
will uphold them (LVN Pictures
The Court then closed its decision with the following Workers vs. LVN, 35 SCRA 147;
pronouncements: 5 Phil. American Embroideries vs.
"Every business enterprise endeavors to Embroidery and Garments
increase its profits. In the process, Workers, 26 SCRA 634; Phil.
it may adopt or devise means
 Refining Co. vs. Garcia, 18 SCRA
110) . . ."
In the case at bar, it must thus be conceded that its adoption of a
new "Sales Evaluation and Production Policy" was within its
management prerogative to regulate, according to its own
discretion and judgment, all aspects of employment, including the
manner, procedure and processes by which particular work
activities should be done. There were, to be sure, objections
presented by the union, i.e, that the schedule had not been "drawn
(up) as a result of an agreement of all concerned," that the new
policy was incomprehensible, discriminatory and whimsical, and
"would result to further reduction" of the sales representatives'
compensation. There was, too, the union's accusation that GTE
had committed unfair labor practices, such as —
"1.  Refusal to bargain on unjust sales policies
particularly on the failure to meet
the 7% of the average sales
production for two consecutive
years;
2. Open territory of accounts;
3.  Illegal suspension of Brian Pineda, a union
officer; and
4.  Non-payment of eight days' suspension pay
increase."
This Court fails to see, however, how these objections and
accusations justify the deliberate and obdurate refusal of the sales
representatives to obey the management's simple requirement for
submission by all Premise Sales Representatives (PSRs) of
individual reports or memoranda requiring reflecting target
revenues — which is all that GTE basically required — and which it
addressed to the employees concerned no less than six (6) times.
The Court fails to see how the existence of objections made by the
union justify the studied disregard, or willful disobedience by the
sales representatives of direct orders of their superior officers to
submit reports. Surely, compliance with their superiors' directives
could not have foreclosed their demands for the revocation or
revision of the new sales policies or rules; there was nothing to
prevent them from submitting the requisite reports with the
reservation to seek such revocation or revision. LLphil
To sanction disregard or disobedience by employees of a rule or
order laid down by management, on the pleaded theory that the
rule or order is unreasonable, illegal, or otherwise irregular for one
reason or another, would be disastrous to the discipline and order
that it is in the interest of both the employer and his employees to
preserve and maintain in the working establishment and without
which no meaningful operation and progress is possible. Deliberate
disregard or disobedience of rules, defiance of management
authority cannot be countenanced. This is not to say that the
employees have no remedy against rules or orders they regard as
unjust or illegal. They may object thereto, ask to negotiate thereon,
bring proceedings for redress against the employer before the
Ministry of Labor. But until and unless the rules or orders are
declared to be illegal or improper by competent authority, the
employees ignore or disobey them at their peril. It is impermissible
to reverse the process: suspend enforcement of the orders or rules
until their legality or propriety shall have been subject of
negotiation, conciliation, or arbitration.
These propositions were in fact adverted to in relation to the
dispute in question by then Minister Blas Ople in his Order dated
January 21, 1986, to the effect among others, that "promulgations
of company policies and regulations are basic management
prerogatives" and that it is a "recognized principle of law that
company policies and regulations are, unless shown to be grossly
oppressive or contrary to law, generally binding (and) valid on the
parties and must be complied with until finally revised or amended
unilaterally or preferably through negotiations or by competent
authorities."
Minister Sanchez however found GTE to have "acted evidently in
bad faith" in firing its 14 salespersons "for alleged violations of the
reportorial requirements of its sales policies which was then the
subject of conciliation proceedings between them;" 6 and that
"(w)hile the company, in merely implementing its challenged sales
policies did not ipso facto commit an unfair labor practice, it did so
when it in mala fide dismissed the fourteen salesmen, all union
members, while conciliation proceedings were being conducted on
disputes on its very same policies, especially at that time when a
strike notice was filed on the complaint of the union alleging that
said sales policies are being used to bust the union; thus
precipitating a lawful strike on the part of the latter." No other facts
appear on record relevant to the issue of GTE's dismissal of the 14
sales representatives. There is no proof on record to demonstrate
any underhanded motive on the part of GTE in formulating and
imposing the sales policies in question, or requiring the submission
of reports in line therewith. What, in fine, appears to be the
Minister's thesis is that an employer has the prerogative to lay
down basic policies and rules applicable to its employees, but may
not exact compliance therewith, much less impose sanctions on
employees shown to have violated them, the moment the propriety
or feasibility of those policies and rules, or their motivation, is
challenged by the employees and the latter file a strike notice with
the Labor Department — which is the situation in the case at bar.
When the strike notice was filed by the union, the chain of events
which culminated in the termination of the 14 sales persons'
employment was already taking place, the series of defiant refusals
by said sales representatives to comply with GTE's requirement to
submit individual reports was already in progress. At that time, no
less than three (3) of the ultimate six (6) direct orders of the
employer for the submission of the reports had already been
disobeyed. The filing of the strike notice, and the commencement
of conciliation activities by the Bureau of Labor Relations did not
operate to make GTE's orders illegal or unenforceable so as to
excuse continued noncompliance therewith. It does not follow that
just because the employees or their union are unable to realize or
appreciate the desirability of their employers' policies or rules, the
latter were laid down to oppress the former and subvert legitimate
union activities. Indeed, the overt, direct, deliberate and continued
defiance and disregard by the employees of the authority of their
employer left the latter with no alternative except to impose
sanctions. The sanction of suspension having proved futile,
termination of employment was the only option left to the employer.
cdrep
To repeat, it would be dangerous doctrine indeed to allow
employees to refuse to comply with rules and regulations, policies
and procedures laid down by their employer by the simple
expedient of formally challenging their reasonableness or the
motives which inspired them, or filing a strike notice with the
Department of Labor and Employment, or, what amounts to the
same thing, to give the employees the power to suspend
compliance with company rules or policies by requesting that they
be a first subject of collective bargaining. It would be well nigh
impossible under these circumstances for any employer to
maintain discipline in its establishment. This is, of course,
intolerable. For common sense teaches, as Mr. Justice Gregorio
Perfecto once had occasion to stress, 7 that:
"Success of industries and public services is the
foundation upon which just wages
may be paid. There cannot be
success without efficiency. There
cannot be efficiency without
discipline. Consequently, when
employees and laborers violate the
rules of discipline they jeopardize
not only the interest of the
employer but also their own. In
violating the rules of discipline they
 aim at killing the hen that lays the
golden eggs. Laborers who trample
down the rules set for an efficient
service are, in effect, parties to a
conspiracy, not only against capital
but also against labor. The high
interest of society and of the
individuals demand that we should
require everybody to do his duty.
That demand is addressed not only
to employer but also to employees.
 
Minister Sanchez decided the dispute in the exercise of the
jurisdiction assumed by his predecessor in accordance with Article
263 (g) of the Labor Code, 8 providing in part as follows:
"(g)  When in his opinion there exists a labor
dispute causing or likely to cause
strikes or lockouts adversely
affecting the national interest, such
as may occur in but not limited to
public utilities, companies engaged
in the generation or distribution of
energy, banks, hospitals, and
export-oriented industries, including
those within export processing
zones, the Minister of Labor and
Employment shall assume
jurisdiction over the dispute and
decide it or certify the same to the
Commission for compulsory
arbitration . . ."
Even that assumption is open to question.
The production and publication of telephone directories, which is
the principal activity of GTE, can scarcely be described as an
industry affecting the national interest. GTE is a publishing firm
chiefly dependent on the marketing and sale of advertising space
for its not inconsiderable revenues. Its services, while of value,
cannot be deemed to be in the same category of such essential
activities as "the generation or distribution of energy" or those
undertaken by "banks, hospitals, and export-oriented industries." It
cannot be regarded as playing as vital a role in communication as
other mass media. The small number of employees involved in the
dispute, the employer's payment of "P10 million in income tax
alone to the Philippine government," and the fact that the "top
officers of the union were dismissed during the conciliation
process," obviously do not suffice to make the dispute in the case
at bar one "adversely affecting the national interest."
WHEREFORE, the petition is GRANTED, and as prayed for, the
Order dated October 1, 1986 of the public respondent is
NULLIFIED and SET ASIDE.
SO ORDERED.
Gancayco, Griño-Aquino and Medialdea, JJ., concur.
Cruz, J., took no part.
||| (GTE Directories Corp. v. Sanchez, G.R. No. 76219, [May 27,
1991], 274 PHIL 738-758)
ST. SCHOLASTICA'S COLLEGE, petitioner, vs. HON. RUBEN
TORRES, in his capacity as SECRETARY OF LABOR AND
EMPLOYMENT, and SAMAHAN NG MANGGAGAWANG PANG-
EDUKASYON SA STA. ESKOLASTIKA-NAFTEU, respondents.
Ernesto R. Arellano for private respondent.
William T. Chua for petitioner.
SYLLABUS
1. LABOR AND SOCIAL LEGISLATION; SECRETARY OF LABOR
AND EMPLOYMENT; SCOPE OF POWER TO ASSUME
JURISDICTION OVER LABOR DISPUTES CAUSING OR LIKELY
TO CAUSE STRIKE OR LOCKOUT IN AN INDUSTRY
INDISPENSABLE TO THE NATIONAL INTEREST. — The issue on
whether respondent SECRETARY has the power to assume
jurisdiction over a labor dispute and its incidental controversies,
causing or likely to cause a strike or lockout in an industry
indispensable to the national interest, was already settled in
International Pharmaceuticals, Inc. v. Secretary of Labor and
Employment (G.R. Nos. 92981-83, 9 January 1992). Therein, We
ruled that: ". . . [T]he Secretary was explicitly granted by Article 263
(g) of the Labor Code the authority to assume jurisdiction over a
labor dispute causing or likely to cause a strike or lockout in an
industry indispensable to the national interest, and decide the
same accordingly. Necessarily, this authority to assume jurisdiction
over the said labor dispute must include and extend to all
questions and controversies arising therefrom, including cases
over which the Labor Arbiter has exclusive jurisdiction." And rightly
so, for, as found in the aforesaid case, Article 217 of the Labor
Code did contemplate of exceptions thereto where the
SECRETARY is authorized to assume jurisdiction over a labor
dispute otherwise belonging exclusively to the Labor Arbiter. This is
readily evident from its opening proviso reading "(e)xcept as
otherwise provided under this Code . . ."
2.  ID.; ID.; ID.; REQUISITES BEFORE THE SECRETARY MAY
TAKE COGNIZANCE OF AN INCIDENTAL ISSUE OF A LABOR
DISPUTES. — Previously, We held that Article 263 (g) of the Labor
Code was broad enough to give the Secretary of Labor and
Employment the power to take jurisdiction over an issue involving
unfair labor practice. (Meycauayan College v. Drilon, G.R. No.
81144, 7 May 1990; 185 SCRA 50) At first glance, the rulings
above stated seem to run counter to that of PAL v. Secretary of
Labor and Employment, (193 SCRA 223), which was cited by
petitioner. But the conflict is only apparent, not real. To recall, We
ruled in the latter case that the jurisdiction of the Secretary of Labor
and Employment in assumption and/or certification cases is limited
to the issues that are involved in the disputes or to those that are
submitted to him for resolution. The seeming difference is,
however, reconcilable. Since the matter on the legality or illegality
of the strike was never submitted to him for resolution, he was thus
found to have exceeded his jurisdiction when he restrained the
employer from taking disciplinary action against employees who
staged an illegal strike. Before the Secretary of Labor and
Employment may take cognizance of an issue which is merely
incidental to the labor dispute, therefore, the same must be
involved in the labor dispute itself, or otherwise submitted to him
for resolution. If it was not, as was the case in PAL v. Secretary of
Labor and Employment, supra, and he nevertheless acted on it,
that assumption of jurisdiction is tantamount to a grave abuse of
discretion. Otherwise, the ruling in International Pharmaceuticals,
Inc. v. Secretary of Labor and Employment, supra, will apply. The
submission of an incidental issue of a labor dispute, in assumption
and/or certification cases, to the Secretary of Labor and
Employment for his resolution is thus one of the instances referred
to whereby the latter may exercise concurrent jurisdiction together
with the Labor Arbiters.
3.  ID.; ID.; ID.; ACADEMIC INSTITUTIONS COVERED. — The
assumption of jurisdiction by the Secretary of Labor and
Employment over labor disputes involving academic institutions
was already upheld in Philippine School of Business Administration
v. Noriel (G.R. No. 80648, 15 August 1988, 164 SCRA 402) where
We ruled thus: "There is no doubt that the on-going labor dispute at
the school adversely affects the national interest. The school is a
duly registered educational institution of higher learning with more
or less 9,000 students. The on-going work stoppage at the school
unduly prejudices the students and will entail great loss in terms of
time, effort and money to all concerned. More important, it is not
amiss to mention that the school is engaged in the promotion of the
physical, intellectual and emotional well-being of the country's
youth." Respondent UNION's failure to immediately comply with
the return-to-work order of 5 November 1990, therefore, cannot be
condoned.
4. ID.; ID.; ID.; ID.; PURPOSE THEREOF; CASE AT BAR. — In the
instant petition, the COLLEGE in its Manifestation, dated 16
November 1990, asked the "Secretary of Labor to take the
appropriate steps under the said circumstances." It likewise prayed
in its position paper that respondent SECRETARY uphold its
termination of the striking employees. Upon the other hand, the
UNION questioned the termination of its officers and members
before respondent SECRETARY by moving for the enforcement of
the return-to-work orders. There is no dispute then that the issue
on the legality of the termination of striking employees was
properly submitted to respondent SECRETARY for resolution.
Such an interpretation will be in consonance with the intention of
our labor authorities to provide workers immediate access to their
rights and benefits without being inconvenienced by the arbitration
and litigation process that prove to be not only nerve-wracking, but
financially burdensome in the long run. Social justice legislation, to
be truly meaningful and rewarding to our workers, must not be
hampered in its application by long-winded arbitration and
litigation. Rights must be asserted and benefits received with the
least inconvenience. For, labor laws are meant to promote, not
defeat, social justice (Maternity Children's Hospital v. Hon.
Secretary of Labor, G.R. No. 78909, 30 June 1989; 174 SCRA
632). After all, Art. 4 of the Labor Code does state that all doubts in
the implementation and interpretation of its provisions, including its
implementing rules and regulations, shall be resolved in favor of
labor.
5 .  I D . ; I D . ; R E T U R N TO W O R K O R D E R T H E R E O F ;
I M M E D I AT E LY E F F E C T I V E A N D E X E C U T O R Y
NOTWITHSTANDING THE FILING OF THE MOTION FOR
RECONSIDERATIONS; RATIONALE; CASE AT BAR. — Article
263 (g) of the Labor Code provides that if a strike has already
taken place at the time of assumption, "all striking . . . employees
shall immediately return to work." This means that by its very
terms, a return-to-work order is immediately effective and
executory notwithstanding the filing of a motion for reconsideration
(University of Sto. Tomas v. NLRC, G.R. No. 89920, 18 October
1990; 190 SCRA 759). It must be strictly complied with even during
the pendency of any petition questioning its validity (Union of
Filipro Employees v. Nestle' Philippines, Inc., 192 SCRA 396). After
all, the assumption and/or certification order is issued in the
exercise of respondent SECRETARY's compulsive power of
arbitration and, until set aside, must therefore be immediately
complied with. The rationale for this rule is explained in University
of Sto. Tomas v. NLRC, supra, citing Philippine Air Lines
Employees Association v. Philippine Air Lines, Inc., 38 SCRA 372
(1971) thus — "To say that its (return-to-work order) effectivity must
wait affirmance in a motion for reconsideration is not only to
emasculate it but indeed to defeat its import, for by then the
deadline fixed for the return to work would, in the ordinary course,
have already passed and hence can no longer be affirmed insofar
as the time element is concerned."
6.  ID.; ID.; ID.; ID.; STRIKES DECLARED IN DEFIANCE
THERETO; CONSIDERED ILLEGAL; LIABILITY OF
PARTICIPANTS. — The respective liabilities of striking union
officers and members who failed to immediately comply with the
return-to-work order is outlined in Art. 264 of the Labor Code which
provides that any declaration of a strike or lockout after the
Secretary of Labor and Employment has assumed jurisdiction over
the labor dispute is considered an illegal act. Any worker or union
officer who knowingly participates in a strike defying a return-to-
work order may, consequently, "be declared to have lost his
employment status." Section 6, Rule IX, of the New Rules of
Procedure of the NLRC, which provides the penalties for defying a
certification order of the Secretary of Labor or a return-to-work
order of the Commission, also reiterates the same penalty. It
specifically states that non-compliance with the aforesaid orders,
which is considered an illegal act, "shall authorize the Secretary of
Labor and Employment or the Commission . . . to enforce the same
under pain of loss of employment status." Under the Labor Code,
assumption and/or certification orders are similarly treated. Thus,
we held in Sarmiento v. Tuico, 162 SCRA 676, that by insisting on
staging the restrained strike and defiantly picketing the company
premises to prevent the resumption of operations, the strikers have
forfeited their right to be readmitted, having abandoned their
positions, and so could be validly replaced.
7.  ID.; ID.; ID.; ID.; ID.; ID.; EFFECTIVE FROM THE MOMENT
THE EMPLOYEE DEFIES THE ORDER. — It is clear from the
provisions above quoted that from the moment a worker defies a
return-to-work order, he is deemed to have abandoned his job. It is
already in itself knowingly participating in an illegal act. Otherwise,
the worker will just simply refuse to return to his work and cause a
standstill in the company operations while retaining the positions
they refuse to discharge or allow the management to fill (Sarmiento
v. Tuico, supra). Suffice it to say, in Federation of Free Workers v.
Inciong, supra, the workers were terminated from work after
defying the return-to-work order for only nine (9) days. It is indeed
inconceivable that an employee, despite a return-to-work order, will
be allowed in the interim to stand akimbo and wait until five (5)
orders shall have been issued for their return before they report
back to work. This is absurd.
 
8.  ID.; CONSTRUCTION OF THE RULES THEREOF IN FAVOR
OF LABOR; DOES NOT APPLY IN CASE OF WILLFUL
DISOBEDIENCE THERETO. — The sympathy of the Court which,
as a rule, is on the side of the laboring classes (Reliance Surety &
Insurance Co., Inc. v. NLRC, G.R. No. 86917-18, 25 January 1991;
193 SCRA 365), cannot be extended to the striking union officers
and members in the instant petition. There was willful disobedience
not only to one but two return-to-work orders. Considering that the
UNION consisted mainly of teachers, who are supposed to be well-
lettered and well-informed, the Court cannot overlook the plain
arrogance and pride displayed by the UNION in this labor dispute.
Despite containing threats of disciplinary action against some
union officers and members who actively participated in the strike,
the letter dated 9 November 1990 sent by the COLLEGE enjoining
the union officers and members to return to work on 12 November
1990 presented the workers an opportunity to return to work under
the same terms and conditions prior to the strike. Yet, the UNION
decided to ignore the same. The COLLEGE, correspondingly, had
every right to terminate the services of those who chose to
disregard the return-to-work orders issued by respondent
SECRETARY in order to protect the interests of its students who
form part of the youth of the land.
DECISION
BELLOSILLO, J p:
The principal issue to be resolved in this recourse is whether
striking union members terminated for abandonment of work after
failing to comply with return-to-work orders of the Secretary of
Labor and Employment (SECRETARY, for brevity) should by law
be reinstated. LexLib
On 20 July 1990, petitioner St. Scholastica's College (COLLEGE,
for brevity) and private respondent Samahan ng Manggagawang
Pang-Edukasyon sa Sta. Eskolastika — NAFTEU (UNION, for
brevity) initiated negotiations for a first-ever collective bargaining
agreement. A deadlock in the negotiations prompted the UNION to
file on 4 October 1990 a Notice of Strike with the Department of
Labor and Employment (DEPARTMENT, for brevity), docketed as
NCMB-NCR-NS-10-826-90.
On 5 November 1990, the UNION declared a strike which
paralyzed the operations of the COLLEGE. Affecting as it did the
interest of the students, public respondent SECRETARY
immediately assumed jurisdiction over the labor dispute and issued
on the same day, 5 November 1990, a return-to-work order. The
following day, 6 November 1990, the UNION was served the Order.
On 7 November 1990, instead of returning to work, the UNION filed
a motion for reconsideration of the return-to-work order questioning
inter alia the assumption of jurisdiction by the SECRETARY over
the labor dispute.
On 9 November 1990, the COLLEGE sent individual letters to the
striking employees enjoining them to return to work not later than
8.00 o'clock A.M. of 12 November 1990 and, at the same time,
giving notice to some twenty-three (23) workers that their return
would be without prejudice to the filing of appropriate charges
against them. In response, the UNION presented a list of six (6)
demands to the COLLEGE in a dialogue conducted on 11
November 1990. The most important of these demands was the
unconditional acceptance back to work of the striking employees.
But these were flatly rejected.
Likewise, on 9 November 1990, respondent SECRETARY denied
reconsideration of his return-to-work order and sternly warned the
striking employees to comply with its terms. On 12 November
1990, the UNION received the Order.
Thereafter, particularly on 14 and 15 November 1990, the parties
held conciliation meetings before the National Conciliation and
Mediation Board where the UNION pruned down its demands to
three (3), viz.: that striking employees be reinstated under the
same terms and conditions before the strike; that no retaliatory or
disciplinary action be taken against them; and, that CBA
negotiations be continued. However, these efforts proved futile as
the COLLEGE remained steadfast in its position that any return-to-
work offer should be unconditional.
On 16 November 1990, the COLLEGE manifested to respondent
SECRETARY that the UNION continued to defy his return-to-work
order of 5 November 1990 so that "appropriate steps under the
said circumstances" may be undertaken by him. 1
On 23 November 1990, the COLLEGE mailed individual notices of
termination to the striking employees, which were received on 26
November 1990, or later. The UNION officers and members then
tried to return to work but were no longer accepted by the
COLLEGE.
On 5 December 1990, a Complaint for Illegal Strike was filed
against the UNION, its officers and several of its members before
the National Labor Relations Commission (NLRC), docketed as
NLRC Case No. 00-12-06256-90.
The UNION moved for the enforcement of the return-to-work order
before respondent SECRETARY, citing "selective acceptance of
returning strikers" by the COLLEGE. It also sought dismissal of the
complaint. Since then, no further hearings were conducted.
Respondent SECRETARY required the parties to submit their
respective position papers. The COLLEGE prayed that respondent
SECRETARY uphold the dismissal of the employees who defied
his return-to-work order.
On 12 April 1991, respondent SECRETARY issued the assailed
Order which, inter alia directed the reinstatement of striking UNION
members, premised on his finding that no violent or otherwise
illegal act accompanied the conduct of the strike and that a
fledgling UNION like private respondent was "naturally expected to
exhibit unbridled if inexperienced enthusiasm, in asserting its
existence". 2 Nevertheless, the aforesaid Order held UNION
officers responsible for the violation of the return-to-work orders of
5 and 9 November 1990 and, correspondingly, sustained their
termination.
Both parties moved for partial reconsideration of the Order, with
petitioner COLLEGE questioning the wisdom of the reinstatement
of striking UNION members, and private respondent UNION, the
dismissal of its officers.
On 31 May 1991, in a Resolution, respondent SECRETARY denied
both motions. Hence, this Petition for Certiorari, with Prayer for the
Issuance of a Temporary Restraining Order.
On 26 June 1991, We restrained the SECRETARY from enforcing
his assailed Orders insofar as they directed the reinstatement of
the striking workers previously terminated. prcd
Petitioner questions the assumption by respondent SECRETARY
of jurisdiction to decide on termination disputes, maintaining that
such jurisdiction is vested instead in the Labor Arbiter pursuant to
Art. 217 of the Labor Code, thus —
"Art. 217.  Jurisdiction of Labor Arbiters and the
Commission. — (a) Except as
otherwise provided under this
Code, the Labor Arbiters shall have
original and exclusive jurisdiction to
hear and decide, within thirty (30)
calendar days after the submission
of the case by the parties for
decision without extension, the
following cases involving all
workers, whether agricultural or
non-agricultural: . . . 2. Termination
disputes . . . 5. Cases arising from
any violation of Article 264 of this
Code, including questions on the
legality of strikes and lock-outs . . ."
In support of its position, petitioner invokes Our ruling in PAL v.
Secretary of Labor and Employment 3 where We held:
"The Labor Secretary exceeded his jurisdiction
when he restrained PAL from taking
disciplinary measures against its
guilty employees, for, under Art.
263 of the Labor Code, all that the
Secretary may enjoin is the holding
of the strike but not the company's
right to take action against union
officers who participated in the
illegal strike and committed illegal
acts."
Petitioner further contends that following the doctrine laid down in
Sarmiento v. Tuico 4 and Union of Filipro Employees v. Nestle
Philippines, Inc., 5 workers who refused to obey a return-to-work
order are not entitled to be paid for work not done, or to
reinstatement to the positions they have abandoned by reason of
their refusal to return thereto as ordered.
Taking a contrary stand, private respondent UNION pleads for
reinstatement of its dismissed officers considering that the act of
the UNION in continuing with its picket was never characterized as
a "brazen disregard of successive legal orders", which was readily
apparent in Union Filipro Employees v. Nestle' Philippines, Inc.,
supra, nor was it a willful refusal to return to work, which was the
basis of the ruling in Sarmiento v. Tuico, supra. The failure of
UNION officers and members to immediately comply with the
return-to-work orders was not because they wanted to defy said
orders; rather, they held the view that academic institutions were
not industries indispensable to the national interest. When
respondent SECRETARY denied their motion, for reconsideration,
however, the UNION intimated that efforts were immediately
initiated to fashion out a reasonable return-to-work agreement with
the COLLEGE, albeit, it failed.
The issue on whether respondent SECRETARY has the power to
assume jurisdiction over a labor dispute and its incidental
controversies, causing or likely to cause a strike or lockout in an
industry indispensable to the national interest, was already settled
in International Pharmaceuticals, Inc. Secretary of Labor and
Employment. 6 Therein, We ruled that:
". . . [T]he Secretary was explicitly granted by
Article 263 (g) of the Labor Code
the authority to assume jurisdiction
over a labor dispute causing or
likely to cause a strike or lockout in
an industry indispensable to the
national interest, and decide the
same accordingly. Necessarily, this
authority to assume jurisdictional
over the said labor dispute must
include and extend to all questions
and controversies arising
therefrom, including cases over
which the Labor Arbiter has
exclusive jurisdiction."
And rightly so, for, as found in the aforesaid case, Article 217 of the
Labor Code did contemplate of exceptions thereto where the
SECRETARY is authorized to assume jurisdiction over a labor
dispute otherwise belonging exclusively to the Labor Arbiter. This is
readily evident from its opening proviso reading "(e)xcept as
otherwise provided under this Code . . ."
 
Previously, We held that Article 263 (g) of the Labor Code was
broad enough to give the Secretary of Labor and Employment the
power to take jurisdiction over an issue involving unfair labor
practice. 7
At first glance, the rulings above stated seem to run counter to that
of PAL v. Secretary or Labor and Employment, supra,which was,
cited by petitioner. But the conflict is only apparent, not real.
To recall, We ruled in the latter case that the jurisdiction of the
Secretary of Labor and Employment in assumption and/or
certification cases is limited to the issues that are involved in the
disputes or to those that are submitted to him for resolution. The defeat, social justice (Maternity Children's Hospital v. Hon.
seeming difference is, however, reconcilable. Since the matter on Secretary of Labor). 8 After all, Art. 4 of the Labor Code does state
the legality or illegality of the strike was never submitted to him for that all doubts in the implementation and interpretation of its
resolution, he was thus found to have exceeded his jurisdiction provisions, including its implementing rules and regulations, shall
when he restrained the employer from taking disciplinary action be resolved in favor of labor.
against employees who staged an illegal strike. We now come to the more pivotal question of whether striking
Before the Secretary of Labor and Employment may take union members, terminated for abandonment of work after failing
cognizance of an issue which is merely incidental to the labor to comply strictly with a return-to-work order, should be reinstated.
dispute, therefore, the same must be involved in the labor dispute We quote hereunder the pertinent provisions of law which govern
itself, or otherwise submitted to him for resolution. If it was not, as the effects of defying a return-to-work order:
was the case in PAL v. Secretary of Labor and Employment, supra, 1. Article 263 (g) of the Labor Code —
and he nevertheless acted on it, that assumption of jurisdiction is "Art. 263. Strikes, picketing, and lockouts. — . . .
tantamount to a grave abuse of discretion. Otherwise, the ruling in (g) When, in his opinion, there
International Pharmaceuticals, Inc. v. Secretary of Labor and exists a labor dispute causing or
Employment, supra, will apply. likely to cause a strike or lockout in
The submission of an incidental issue of a labor dispute, in an industry indispensable to the
assumption and/or certification cases, to the Secretary of Labor national interest, the Secretary of
and Employment for his resolution is thus one of the instances Labor and Employment may
referred to whereby the latter may exercise concurrent jurisdiction assume jurisdiction over the
together with the Labor Arbiters. dispute and decide it or certify the
In the instant petition, the COLLEGE in its Manifestation, dated 16 same to the Commission for
November 1990, asked the "Secretary of Labor to take the compulsory arbitration. Such
appropriate steps under the said circumstances." It likewise prayed assumption or certification shall
in its position paper that respondent SECRETARY uphold its have the effect of automatically
termination of the striking employees. Upon the other hand, the enjoining the intended or impending
UNION questioned the termination of its officers and members strike or lockout as specified in the
before respondent SECRETARY by moving for the enforcement of assumption or certification order. If
the return-to-work orders. There is no dispute then that the issue one has already taken place at the
on the legality of the termination of striking employees was time of assumption or certification,
properly submitted to respondent SECRETARY for resolution. all striking or locked out employees
Such an interpretation will be in consonance with the intention of shall immediately return to work
our labor authorities to provide workers immediate access to their and the employer shall immediately
rights and benefits without being inconvenienced by the arbitration resume operations and readmit all
and litigation process that prove to be not only nerve-wracking, but workers under the same terms and
financially burdensome in the long run. Social justice legislation, to conditions prevailing before the
be truly meaningful and rewarding to our workers, must not be strike or lookout. The Secretary of
hampered in its application by long-winded arbitration and Labor and Employment or the
litigation. Rights must be asserted and benefits received with the Commission may seek the
least inconvenience. For, labor laws are meant to promote, not assistance of law enforcement
 agencies to ensure compliance with
this provision as well as with such
orders as he may issue to enforce
the same . . ." (as amended by
Sec. 27, R.A. 6715; emphasis
supplied).
2. Article 264, same Labor Code —
"Art. 264.  Prohibited activities. — (a) No labor
organization or employer shall
declare a strike or lockout without
first having bargained collectively in
accordance with Title VII of this
Book or without first having filed the
notice required in the preceding
Article or without the necessary
strike or lockout vote first having
been obtained and reported to the
Ministry.
3. Section 6, Rule IX, of the New Rules of Procedure of the NLRC
(which took effect on 31 August 1990) —
"Section 6.  Effects of Defiance. — Non-
"No strike or lockout shall be declared after
assumption of jurisdiction by the
President or the Minister or after
certification or submission of the
dispute to compulsory or voluntary
arbitration or during the pendency
of cases involving the same
grounds for the strike or lockout . . .
(emphasis supplied).
"Any worker whose employment has been
terminated as a consequence of an
unlawful lockout shall be entitled to
reinstatement with full back wages.
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 .
. ." (emphasis supplied).
compliance with the certification
order of the Secretary of Labor and
Employment or a return to work
order of the Commission shall be
considered an illegal act committed
in the course of the strike or lookout
and shall authorize the Secretary of
Labor and Employment or the
Commission, as the case may be,
to enforce the same under pain or
loss of employment status or
entitlement to full employment
benefits from the locking-out
employer or backwages, damages
 and/or other positive and/or be affirmed insofar as the time
affirmative reliefs, even to criminal element is concerned."
prosecution against the liable
parties . . ." (emphasis supplied).

Moreover, the assumption of jurisdiction by the Secretary of Labor

and Employment over labor disputes involving academic
Private respondent UNION maintains that the reason they failed ko institutions was already upheld in Philippine School of Business
immediately comply with the return-to-work order of 5 November Administration v. Noriel 11 where We ruled thus:
1990 was because they questioned the assumption of jurisdiction "There is no doubt that the on-going labor
of respondent SECRETARY. They were of the impression that dispute at the school adversely
being an academic institution, the school could not be considered affects the national interest. The
an industry indispensable to national interest, and that pending school is a duly registered
resolution of the issue, they were under no obligation to educational institution of higher
immediately return to work. learning with more or less 9,000
This position of the UNION is simply flawed. Article 263 (g) Labor students. The on-going work
Code provides that if a strike has already taken place at the time of stoppage at the school unduly
assumption, "all striking . . . employees shall immediately return to prejudices the students and will
work." This means that by its very terms, a return-to-work order is entail great loss in terms of time,
immediately effective and executory notwithstanding the filing of a effort and money to all concerned.
motion for reconsideration (University of Sto. Tomas v. NLRC). 9 It More important, it is not amiss to
must be strictly complied with even during the pendency of any mention that the school is engaged
petition questioning its validity (Union of Filipro Employees v. in the promotion of the physical,
Nestle' Philippines, Inc., supra) After all, the assumption and/or intellectual and emotional well-
certification order is issued in the exercise of respondent being of the country's youth."
SECRETARY's compulsive power of arbitration and, until set aside,
must therefore be immediately complied with.
The rationale for this rule is explained in University of Sto. Tomas v.
NLRC, supra, citing Philippine Air Lines Employees Association v.
Philippine Air Lines, Inc., 10 thus — Respondent UNION's failure to immediately comply with the return-
"To say that its (return-to-work order) effectivity to-work order of 5 November 1990, therefore, cannot be condoned.
must wait affirmance in a motion for The respective liabilities of striking union officers and members
reconsideration is not only to who failed to immediately comply with the return-to-work order is
emasculate it but indeed to defeat outlined in Art. 264 of the Labor Code which provides that any
its import, for by then the deadline declaration of a strike or lockout after the Secretary of Labor and
fixed for the return to work would, in Employment has assumed jurisdiction over the labor dispute is
the ordinary course, have already considered an illegal act. Any worker or union officer who
passed and hence can no longer knowingly participates in a strike defying a return-to-work order
may, consequently, "be declared to have lost his employment
status."
 
Section 6, Rule IX, of the New Rules of Procedure of the NLRC,
which provides the penalties for defying a certification order of the
Secretary of Labor or a return-to-work order of the Commission,
also reiterates the same penalty. It specifically states that non-
compliance with the aforesaid orders, which is considered an
illegal act, "shall authorize the Secretary of Labor and Employment
or the Commission . . . to enforce the same under pain of loss of
employment status." Under the Labor Code, assumption and/or
certification orders are similarly treated.
Thus, we held in Sarmiento v. Tuico, supra, that by insisting on
staging the restrained strike and defiantly picketing the company
premises to prevent the resumption of operations, the strikers have
forfeited their right to be readmitted, having abandoned their
positions, and so could be validly replaced. Cdpr
We recently reiterated this stance in Federation of Free Workers v.
Inciong, 12 wherein we cited Union of Filipro Employees v. Nestle'
Philippines, Inc., supra, thus —
"A strike undertaken despite the issuance by the
Secretary of Labor of an
assumption or certification order
becomes a prohibited activity and
thus illegal, pursuant to the second
paragraph of Art. 264 of the Labor
Code as amended . . . The union
officers and members, as a result,
are deemed to have lost their
employment status for having
knowingly participated in an illegal
act."
Despite knowledge of the ruling in Sarmiento v. Tuico, supra,
records of the case reveal that private respondent UNION opted to
defy not only the return-to-work order of 5 November 1990 but also
that of 9 November 1990.
While they claim that after receiving copy of the Order of 9
November 1990 initiatives were immediately undertaken to fashion
out a return-to-work agreement with management, still, the
unrebutted evidence remains that the striking union officers and
members tried to return to work only eleven (11) days after the
conciliation meetings ended in failure, or twenty (20) days after
they received copy of the first return-to-work order on 5 November
1990.
The sympathy of the Court which, as a rule, is on the side of the
laboring classes (Reliance Surety & Insurance Co., Inc. v. NLRC),
13 cannot be extended to the striking union officers and members
in the instant petition. There was willful disobedience not only to
one but two return-to-work orders. Considering that the UNION
consisted mainly of teachers, who are supposed to be well-lettered
and well-informed, the Court cannot overlook the plain arrogance
and pride displayed by the UNION in this labor dispute. Despite
containing threats of disciplinary action against some union officers
and members who actively participated in the strike, the letter
dated 9 November 1990 sent by the COLLEGE enjoining the union
officers and members to return to work on 12 November 1990
presented the workers an opportunity to return to work under the
same terms and conditions prior to the strike. Yet, the UNION
decided to ignore the same. The COLLEGE, correspondingly, had
every right to terminate the services of those who chose to
disregard the return-to-work orders issued by respondent
SECRETARY in order to protect the interests of its students who
form part of the youth of the land.
Lastly, the UNION officers and members also argue that the
doctrine laid down in Sarmiento v. Tuico, supra, and Union of
Filipro Employees v. Nestle' Philippines, Inc., supra, cannot be
made applicable to them because in the latter two cases, workers
defied the return-to-work orders for more than five (5) months.
Their defiance of the return-to-work order, it is said, did not last
more than a month.
Again, this line of argument must be rejected. It is clear from the
provisions above quoted that from the moment a worker defies a
return-to-work order, he is deemed to have abandoned his job. It is
already in itself knowingly participating in an illegal act. Otherwise,
the worker will just simply refuse to return to his work and cause a
standstill they refused to discharge or allow the management to fill
(Sarmiento v. Tuico, supra). Suffice it to say, in Federation of Free
Workers v. Inciong, supra, the workers were terminated from work
after defying the return-to-work order for only nine (9) days. It is
indeed inconceivable that an employee, despite a return-to-work
order, will be allowed in the interim to stand akimbo and wait until
five (5) orders shall have been issued for their return before they
report back to work. This is absurd.
In fine, respondent SECRETARY gravely abused his discretion
when he ordered the reinstatement of striking union members who
refused to report back to work after he issued two (2) return-to-
work orders, which in itself is knowingly participating in an illegal
act. The Order in question is, certainly, contrary to existing law and
jurisprudence.
WHEREFORE, the Petition for Certiorari is hereby GRANTED. The
Order of 12 April 1991 and the Resolution of 31 May 1991 both
issued by respondent Secretary of Labor and Employment are SET
ASIDE insofar as they order the reinstatement of striking union
members terminated by petitioner, and the temporary restraining
order We issued on June 26, 1991, is made permanent.
No costs.
SO ORDERED.
Cruz, Griño-Aquino and Bellosillo, JJ ., concur.
 
||| (St. Scholastica's College v. Torres, G.R. No. 100158, [June 29,
1992], 285 PHIL 1103-1119)
MERLINDA JACINTO, ADELINA AGUSTIN, SUSAN AGUSTIN,
EVELYN ATIENZA, NIDA BALANE, ANICIA CARLOS,
CELEDONIA CARLOS, LIWANAG CASTILLO, JOSEFINA DE
GUZMAN, MINERVA GARCIA, MARIA GATDULA, ALICIA
GUNDA, AURORA LOPEZ, CARMENCITA MANANSALA,
ERLINDA MARTINEZ, LOLITA NAVARRETE, GUADALUPE
PANERGO, MARIA PULGA, PAZ SERRA and VIRGINIA
ZAMORA, petitioners, vs. HON. COURT OF APPEALS, THE
CIVIL SERVICE COMMISSION, and THE SECRETARY OF
EDUCATION, CULTURE AND SPORTS, respondents.
Froilan M. Bacungan & Associates for petitioners.
The Solicitor General for respondents.
SYNOPSIS
Petitioners are public school teachers who incurred unauthorized
absences in connection with the mass actions which they staged.
DECS Secretary Cariño issued a return-to-work order, or dismissal
proceedings shall be instituted against them. The directive was
ignored and petitioners were administratively charged with gross
misconduct, gross neglect of duty, etc. Sec. Cariño, in his
decisions, found them guilty as charged and imposed the penalty
of dismissal. The decisions were appealed to the Merit Systems
Protection Board but they were dismissed. When appealed to the
Civil Service Commission, petitioners were found guilty of Conduct
Prejudicial to the Best Interest of the Service. Imposed upon them
was the penalty of 6 months suspension without pay, and
automatic reinstatement to service without payment of back
salaries. Hence, the petition. IDTHcA
The Supreme Court held that the petitioners here were not
penalized for the exercise of their right to assemble peacefully and
to petition the government for a redress of grievances. Rather, the
Civil Service Commission found them guilty of conduct prejudicial
to the best interest of the service for having absented themselves
without proper authority from their schools during regular school
days in order to participate in the mass protest. Their absence
ineluctably resulted in the non-holding of classes and in the
deprivation of students of education for which they were
responsible. Thus, petitioners' demand for backwages cannot be
granted, for they had given cause for their suspension — their
unjustified abandonment of classes to the prejudice of their
students. Although they were not found guilty of an offense
warranting their dismissal from the service, they were not fully
innocent of the charges against them. EIDATc
SYLLABUS
1.  LABOR AND SOCIAL LEGISLATION; STRIKE, DEFINED. —
Strike, as defined by law, means any temporary stoppage of work
by the concerted action of employees as a result of an industrial or
labor dispute. A labor dispute includes any controversy or matter
concerning terms and conditions of employment; or the association
or representation of persons in negotiating, fixing, maintaining,
changing or arranging the terms and conditions of employment,
regardless of whether the disputants stand in the proximate
relation of employers and employees. DaEATc
2.  POLITICAL LAW; CIVIL SERVICE LAW; PROHIBITED ACTS;
STRIKE; COMMITTED IN CASE AT BAR. — The mass action or
assembly staged by the petitioners resulted in the non-holding of
classes in several public schools during the corresponding period.
Petitioners do not dispute that the grievances for which they sought
redress concerned the alleged failure of public authorities —
essentially, their "employers" — to fully and justly implement
certain laws and measures intended to benefit them materially.
However, as in the, case of Balingasan vs. Court of Appeals, this
Court said that the fact that the conventional term "strike" was not
used by the participants to describe their common course of action
was insignificant, since the substance of the situation, and not its
appearance, was deemed controlling. Petitioners here were not
penalized for the exercise of their right to assemble peacefully and
to petition the government for a redress of grievances. Rather, the
Civil Service Commission found them guilty of conduct prejudicial
to the best interest of the service for having absented themselves
without proper authority, from their schools during regular school
days, in order to participate in the mass protest, their absence
ineluctably resulting in the non-holding of classes and in the
deprivation of students of education, for which they were
responsible. Had petitioners availed themselves of their free time
— recess, after classes, weekends or holidays — to dramatize
their grievances and to dialogue with the proper authorities within
the bounds of law, no one — not the DECS, the CSC or even this
Court — could have held them liable for the valid exercise of their
constitutionally guaranteed rights. As it was, the temporary
stoppage of classes resulting from their activity necessarily
disrupted public services, the very evil sought to be forestalled by
the prohibition against strikes by government workers. Their act by
its nature was enjoined by the Civil Service law, rules and
regulations, for which they must, therefore, be made answerable.
HaECDI
3. REMEDIAL LAW; EVIDENCE; FINDINGS OF ADMINISTRATIVE
AGENCIES, RESPECTED. — Findings of administrative agencies,
which have acquired expertise because their jurisdiction is
confined to specific matters, are accorded not only respect but
even finality particularly when affirmed by the appellate tribunal. It
is not a function of this Court to examine and evaluate the
probative value of the evidence proffered in the concerned forum,
which formed the basis of the latter's impugned decision, resolution
or order absent a clear showing of arbitrariness and want of any
rational basis therefor. The regulation requires (1) the filing of the
application for sick leave on the prescribed form immediately upon
the employee's return from such leave and (2) a notice of absence
to be sent to the immediate supervisor and/or office head. But the
Commission found that "the records are bereft of any showing that
Jacinto asked permission from school authorities to go out of
school premises and seek medical attention outside nor did she file
an application for sick leave . . ." Hence, its conclusion that
petitioner violated reasonable office rules and regulations. The
totality of the evidence on record sustains the findings and
conclusions of the Commission, as affirmed by the Court of
Appeals. We have no reason to reverse them. The Civil Service
rules clearly provide that violation of reasonable office rules and
regulations, on first offense, carries the penalty of reprimand.
4.  ADMINISTRATIVE LAW; PREVENTIVE SUSPENSION;
PROPER IN CASE AT BAR. — The charges filed against
petitioners warranted their preventive suspension from the service,
as provided under Section 51, Chapter 7 (on Discipline) of the
Administrative Code. The petitioners' alleged lapses, initially found
substantiated by the DECS, qualify as grave misconduct or neglect
in the performance of duty under the said rule. Thus, former
Education Secretary Cariño had the legal authority to suspend
them pending further investigation.
5.  POLITICAL LAW; CIVIL SERVICE LAW; PENALTY OF
DISMISSAL RENDERED BY THE DEPARTMENT SECRETARY,
IMMEDIATELY EXECUTORY. — The Secretary's immediate
execution of his decisions imposing the penalty of dismissal finds
legal basis in Sec. 47 (2) of the Civil Service law. The department
secretary's decision confirming the removal of an officer or
employee under his jurisdiction is executory in character, i.e., such
decision may be immediately executed even pending further
remedy, such as an appeal, by the dismissed officer or employee.
In the case at bar, it was already the final judgments of Secretary
Cariño which were forthwith carried out. The statutory provision
rules out the alleged illegality of the actions of the DECS Secretary.
6.  LABOR AND SOCIAL LEGISLATION; BACKWAGES;
PROPRIETY IN CASE AT BAR. — Backwages may be granted
only to those who have been illegally dismissed and thenceforth
ordered reinstated, or to those acquitted of the charge against
them. In the case of Balingasan, petitioners therein participated in
the unlawful mass actions for which they were meted suspension.
The Court opined that they were not completely exonerated of the
charges against them. They were denied back salaries because
they had given ground for their suspension. This means that being
found liable for a lesser offense is not equivalent to exoneration
from the original complaint against the concerned public officer or
employee. Here, petitioners' demand for backwages cannot be
granted, for they had given cause for their suspension — their
unjustified abandonment of classes to the prejudice of their
students. Although they were eventually found guilty only of
conduct prejudicial to the best interest of the service, and not grave
misconduct or other offense warranting their dismissal from the
service, they were not fully innocent of the charges against them.
In the case of Petitioner Jacinto however, the Civil Service
Commission found her culpable only of violation of reasonable
office rules and regulations, for not having asked permission from
school authorities to leave the school premises and seek medical
attention and for not filing an application for sick leave for approval
by the school authorities. There was no proof that she joined the
mass actions which caused prejudice to the school system. Hence,
We grant back salaries to Petitioner Jacinto who did not join the
illegal activity.
DECISION As regards Petitioner Merlinda Jacinto, the decretal portion of the
PANGANIBAN, J p: resolution pertaining to her case reads:
While we recognize and appreciate the toil and hardship of our "WHEREFORE, foregoing premises considered,
public schoolteachers in fulfilling the state's responsibility of the Commission hereby resolves to
educating our children, and realize their inadequately addressed find Merlinda Jacinto guilty of
plight as compared to other professionals, we have the equal task Violation of Reasonable Office
of promoting the larger public interest which withholds from them Rules and Regulations. She is
and other similarly situated government workers the right to hereby meted out the penalty of
engage in mass actions resulting in work stoppages for any reprimand. She is automatically
purpose. Although the Constitution vests in them the fight to reinstated in the service without
organize, to assemble peaceably and to petition the government payment of back salaries." 5
for a redress of grievances, there is no like express provision
granting them the right to strike. Rather, the constitutional grant of
the right to strike is restrained by the proviso that its exercise shall
be done in accordance with law. cdasia
  In a Resolution 6 dated March 29, 1996, Respondent Court of
The Case Appeals denied the petitioners' motion for reconsideration. LexLib
Before us is a petition for review under Rule 45 of the Rules of The Facts
Court seeking to set aside the November 27, 1995 Decision 1 of The following are the antecedents of the case as narrated by the
the Court of Appeals 2 in CA-G.R. SP No. 37596, which found no Court of Appeals, which we find substantiated by the records:
grave abuse of discretion on the part of the Civil Service "Petitioners are public school teachers from
Commission (CSC) in issuing its resolutions 3 disposing of the various schools in Metropolitan
separate appeals and motions for reconsideration of herein Manila. Between the period
petitioners. The dispositive portions of most of the CSC resolutions, September 17 to 21, 1990, they
with the exception of the name of the appellant concerned, incurred unauthorized absences in
uniformly read: connection with the mass actions
"WHEREFORE, foregoing premises considered, then staged; and on September 17,
the Commission hereby resolves to 1990, DECS Secretary Isidro
find Susan Agustin guilty of Cariño immediately issued a return-
Conduct Prejudicial to the Best to-work order worded as follows:
Interest of the Service. She is
meted out the penalty of six (6)
months suspension without pay.
Agustin is now automatically
reinstated in the service without 'TO:  ALL PUBLIC SCHOOL TEACHERS AND
payment of back salaries." 4 O T
H E
R
D E
 C S
P E
R S
O N
N E
L administratively charged with gross
SUBJECT: RETURN TO WORK ORDER
Under Civil Service law and rules, strikes,
unauthorized mass
leaves and other forms
of mass actions by civil
servants which disrupt
public services are
strictly prohibited.
Those of you who are engaged in the above-
mentioned prohibited
acts are therefore
ordered, in the interest of
public service, to return
to work within 24 hours
from your walkout
otherwise dismissal
proceedings shall be
instituted against
you.' (Emphasis
supplied).
The directive was ignored by petitioners.
Consequently, on separate dates,
Secretary Cariño issued formal
charges and preventive suspension
orders against them. They were
misconduct; gross neglect of duty,
etc. for joining unauthorized mass
actions; ignoring report-to-work
directives; unjustified abandonment
of teaching posts; non-observance
of Civil Service law, rules and
regulations; non-compliance with
r e a s o n a b l e o f fi c e r u l e s a n d
regulations; and incurring
unauthorized absences without
leave, etc. An investigation
committee was then created by
Sec. Cariño to look into the matter.
However, during the investigation,
petitioners did not file their answers
or controvert the charges against
them. As a consequence, Sec.
Cariño, in his decisions found them
guilty as charged and imposed the
penalty of dismissal, except with
respect to petitioners Merlinda
Jacinto and Adelina Agustin who
were meted only six (6) months
suspension.
The decisions were appealed to the Merit
Systems Protection Board (MSPB)
which dismissed the appeals for
lack of merit and then to the Civil
Service Commission which set
 aside the Orders of the MSPB in
the contested resolutions. The Civil
Service Commission, in separate
resolutions, found the petitioners
(except Merlinda Jacinto) guilty of
Conduct Prejudicial to the Best
Interest of the Service; imposed
upon them the penalty of six (6)
months suspension without pay;
and automatically reinstated them
to the service without payment of
back salaries. . . . In the case of
Petitioner Merlinda Jacinto, the
CSC found her guilty of Violation of
Reasonable Office Rules and
Regulations; imposed upon her the
penalty of reprimand; and
automatically reinstated her in the
service without payment of back
salaries. . . .
Acting on the motions for reconsideration, the
CSC rendered the assailed
resolutions denying the motions for
lack of merit." 7
Petitioners initially questioned the CSC resolutions directly before
this Court in petitions docketed as G.R. Nos. 118252 to 118271. In
accordance with Revised Administrative Circular 1-95, we referred
them to the Court of Appeals.
Respondent Court found that the "petitioners absented themselves
from their classes in furtherance of or in connection with the 'mass
action' for the purpose of pressuring the government to grant their
demands." Citing the resolution of this Court in MPSTA vs. Laguio
8 that the mass actions staged by the public schoolteachers from
September 17 to September 19, 1990, were "to all intents and
purposes a strike," it denied the petition, since the right to strike did
not extend to civil service employees. In the case of Merlinda
Jacinto, Respondent Court found no error on the part of the CSC in
finding her guilty of violation of reasonable office rules and
regulations. Neither did it find the petitioners entitled to backwages
for the period of their preventive suspension, as they were "not
exonerated of the charges against them."
Hence, this petition. 9
Issues
Petitioners raise the following grounds for their appeal:
"I. The Respondent Court of Appeals committed
grave abuse of discretion when it
upheld the resolutions of the Civil
Service Commission that penalized
all the petitioners whose only
'offense' (except Jacinto) was to
exercise their constitutional right
peaceably to assemble and petition
the government for redress of
grievances.
"II. The Respondent Court of Appeals committed
grave abuse of discretion when it
upheld the resolutions of the Civil
Service Commission that penalized
Petitioner Jacinto for an alleged
offense which has no basis
whatsoever thereby violating her
right to security of tenure.
"III.  The Respondent Court of Appeals upheld the right to assembly and petition and even went as far as
committed grave abuse of to acknowledge:
discretion when it upheld the "It is rather to be expected that more or less
resolutions of the Civil Service disorder will mark the public
Commission that denied petitioners assembly of the people to protest
their right to backwages covering against grievances whether real or
the period when they were illegally imaginary, because on such
not allowed to teach." 10 occasions feeling is always wrought
to a high pitch of excitement, and
the greater the grievance and the
more intense the feeling, the less
perfect, as a rule, will be the
Preliminarily, we note that the remedy resorted to by petitioners is a disciplinary control of the leaders
petition for review under Rule 45 of the Rules of Court which, over their irresponsible followers.
however, allows "only questions of law." 11 Jurisprudence has But if the prosecution be permitted
extended this remedy to questions of fact in exceptional cases. 12 to seize upon every instance of
Where the issues raised involve lack of jurisdiction or grave abuse such disorderly conduct by
of discretion as in this case, the Rules provide for a different individual members of a crowd as
remedy — Rule 65. In the interest of substantial justice, however, an excuse to characterize the
we hereby decide to deal with this petition as one filed under Rule assembly as a seditious and
45, as denominated in its prefatory paragraph, and treat the "grave tumultuous rising against the
abuse of discretion" on the part of Respondent Court of Appeals as authorities, then the right to
allegations of "reversible errors." assemble and to petition for
The Court's Ruling redress of grievances would
The petition, which fails to convince us, merits only dismissal. become a delusion and a snare
First Issue: Improper Exercise of the Right to and the attempt to exercise it on
Peaceful Assembly and to Petition for a Redress of Grievances the most righteous occasion and in
There is no question as to the petitioners' rights to peaceful the most peaceable manner would
assembly to petition the government for a redress of grievances expose all those who took part
and, for that matter, to organize or form associations for purposes therein to the severest and most
not contrary to law, as well as to engage in peaceful concerted unmerited punishment, if the
activities. These rights are guaranteed by no less than the purposes which they sought to
Constitution, particularly Sections 4 13 and 8 14 of the Bill of attain did not happen to be pleasing
Rights, Section 2(5) 15 of Article IX, and Section 3 16 of Article XIII. to the prosecuting authorities. If
Jurisprudence abounds with hallowed pronouncements defending instances of disorderly conduct
and promoting the people's exercise of these rights. As early as the occur on such occasions, the guilty
onset of this century, this Court, in U.S. vs. Apurado, 17 already individuals should be sought out
and punished therefor, but the
utmost discretion must be
 exercised in drawing the line
between disorderly and seditious
conduct and between an essentially
peaceable assembly and a
tumultuous uprising." 18
Primicia vs. Fugoso 19 further sustained the supremacy of the
freedoms of speech and of assembly over comfort and
convenience in the use of streets or parks. Although the Court
opined that the exercise of the rights of free speech and of
peaceful assembly to petition the government for redress of
grievances "is not absolute for it may be so regulated that it shall
not be injurious to the equal enjoyment of others having equal
rights, nor injurious to the rights of the community or society,"
regulation was limited to the mayor's reasonable discretion in
issuing a permit to determine or specify only the streets or public
places to be used for the purpose and to provide adequate and
proper policing to minimize the risk of disorder. Quoting Justice
Brandeis in his concurring opinion in Whitney vs. California, the
Court said: 20
 
"Fear of serious injury cannot alone justify
suppression of free speech and
a s s e m b l y . . . . To j u s t i f y
suppression of free speech there
must be reasonable ground to fear
that serious evil will result if free
speech is practiced. There must be
reasonable ground to believe that
the danger apprehended is
imminent. There must be
reasonable ground to believe that
the evil to be prevented is a serious
one. . . .
xxx xxx xxx
. . . The fact that speech is likely to result in
some violence or in destruction of
property is not enough to justify its
suppression. There must be the
probability of serious injury to the
state. . . ." prcd
This limitation was strictly applied in Reyes vs. Bagatsing, 21 in
which "the Court [was] called upon to protect the exercise of the
cognate rights to free speech and peaceful assembly, arising from
the denial of a permit." In that case, retired Justice J.B.L. Reyes,
on behalf of the Anti-Bases Coalition, sought a permit from the
mayor of Manila to hold a march and a rally starting from Luneta,
proceeding through Roxas Boulevard to the gates of the U.S.
Embassy, to be attended by local and foreign participants to the
International Conference for General Disarmament, World Peace
and the Removal of All Foreign Military Bases. The Manila mayor
denied them the permit "due to police intelligence reports which
strongly militate against the advisability of issuing such permit at
this time and at the place applied for." In reversing the mayor, this
Court stated that to justify limitations on freedom of assembly, there
must be proof of sufficient weight to satisfy the "clear and present
danger" 22 test. Thereafter, the Court proceeded to summarize the
rules on assembly and petition, 23 making the clear-and-present
danger rule the standard for refusing or modifying the grant of a
permit. But it stressed that "the presumption must be to incline the
weight of the scales of justice on the side of such rights [of free
speech and peaceable assembly], enjoying as they do precedence
and primacy."
Philippine Blooming Mills Employees Organization vs. Philippine
Blooming Mills Co., Inc., 24 which was promulgated after the
proclamation of martial law, further underscored the supremacy of
these basic constitutional rights, this time over property rights.
Speaking through Mr. Justice Makasiar, the Court explained:
". . . the primacy of human rights — freedom of
expression, of peaceful assembly
and of petition for redress of
grievances — over property rights
has been sustained. Emphatic
reiteration of this basic tenet as a
coveted boon — at once the shield
and armor of the dignity and worth
of the human personality, the all-
consuming ideal of our enlightened
civilization — becomes [o]ur duty, if
freedom and social justice have
any meaning at all for him who toils
so that capital can produce
economic goods that can generate
happiness for all. To regard the
demonstration against police
officers, not against the employer,
as evidence of bad faith in
collective bargaining and hence a
violation of the collective bargaining
agreement and a cause for the
dismissal from employment of the
demonstrating employees,
stretches unduly the compass of
the collective bargaining
agreement, is 'a potent means of
inhibiting speech' and therefore
inflicts a moral as well as mortal
wound on the constitutional
guarantees of free expression, of
peaceful assembly and of petition."
25
Specifically, the right of civil servants to organize themselves was
positively recognized in Association of Court of Appeals Employees
(ACAE) vs. Ferrer-Calleja. 26 But, as in the exercise of the rights of
free expression and of assembly, there are standards for allowable
limitations such as the legitimacy of the purposes of the
association, 27 the overriding considerations of national security
and the preservation of democratic institutions. 28
As regards the right to strike, the Constitution itself qualifies its
exercise with the proviso "in accordance with law." This is a clear
manifestation that the state may, by law, regulate the use of this
right, or even deny certain sectors such right. Executive Order 180
29 which provides guidelines for the exercise of the right of
government workers to organize, for instance, implicitly endorsed
an earlier CSC circular which "enjoins under pain of administrative
sanctions, all government officers and employees from staging
strikes, demonstrations, mass leaves, walkouts and other forms of
mass action which will result in temporary stoppage or disruption of
public service," 30 by stating that the Civil Service law and rules
governing concerted activities and strikes in the government
service shall be observed. 31
It is also settled in jurisprudence that, in general, workers in the
public sector do not enjoy the right to strike. Alliance of
Government Workers vs. Minister of Labor and Employment 32
rationalized the proscription thus:
"The general rule in the past and up to the
present is that the 'terms and
conditions of employment in the
Government, including any political
subdivision or instrumentality
thereof are governed by law.' . . .
Since the terms and conditions of
government employment are fixed
by law, government workers cannot
use the same weapons employed
by the workers in the private sector
to secure concessions from their
employers. The principle behind
labor unionism in private industry is
 that industrial peace cannot be
secured through compulsion by
law. Relations between private
employers and their employees rest
on an essentially voluntary basis.
Subject to the minimum
requirements of wage laws and
other labor and welfare legislation,
the terms and conditions of
employment in the unionized
private sector are settled through
the process of collective
bargaining. In government
employment, however, it is the
legislature and, where properly
g i v e n d e l e g a t e d p o w e r, t h e
administrative heads of government
which fix the terms and conditions
of employment. And this is effected
through statutes or administrative
circulars, rules, and regulations, not
through collective bargaining
agreements." 33
After delving into the intent of the framers of the Constitution, the
Court affirmed the above rule in Social Security System Employees
Association (SSSEA) vs. Court of Appeals 34 and explained:
"Government employees may, therefore, through
their unions or associations, either
petition the Congress for the
betterment of the terms and
conditions of employment which
are within the ambit of legislation or
negotiate with the appropriate
government agencies for the
improvement of those which are not
fixed by law. If there be any
unresolved grievances, the dispute
may be referred to the Public
Sector Labor-Management Council
for appropriate action. But
employees in the civil service may
not resort to strikes, walkouts and
other temporary work stoppages,
like workers in the private sector, to
pressure the Government to
accede to their demands. As now
provided under Sec. 4, Rule III of
the Rules and Regulations to
Govern the Exercise of the Right of
Government Employees to Self-
Organization, which took effect
after the instant dispute arose,
'[t]he terms and conditions of
employment in the government,
including any political subdivision or
instrumentality thereof and
government-owned and controlled
corporations with original charters
are governed by law and
employees therein shall not strike
for the purpose of securing
changes [thereto].'" 35
We now come to the case before us. Petitioners, who are public
schoolteachers and thus government employees, do not seek to
establish that they have a right to strike. Rather, they tenaciously
insist that their absences during certain dates in September 1990
were a valid exercise of their constitutional right to engage in
peaceful assembly to petition the government for a redress of
grievances. They claim that their gathering was not a strike;
therefore, their participation therein did not constitute any offense.
MPSTA vs. Laguio 36 and ACT vs. Cariño, 37 in which this Court
declared that "these 'mass actions' were to all intents and purposes
a strike; they constituted a concerted and unauthorized stoppage
of, or absence from, work which it was the teachers' duty to
perform, undertaken for essentially economic reasons," should not
principally resolve the present case, as the underlying facts are
allegedly not identical. dctai
Strike, as defined by law, means any temporary stoppage of work
by the concerted action of employees as a result of an industrial or
labor dispute. 38 A labor dispute includes any controversy or
matter concerning terms and conditions of employment; or the
association or representation of persons in negotiating, fixing,
maintaining, changing or arranging the terms and conditions of
employment, regardless of whether the disputants stand in the
proximate relation of employers and employees. 39 With these
premises, we now evaluate the circumstances of the instant
petition.
It cannot be denied that the mass action or assembly staged by the
petitioners resulted in the non-holding of classes in several public
schools during the corresponding period. Petitioners do not dispute
that the grievances for which they sought redress concerned the
alleged failure of public authorities — essentially, their "employers"
— to fully and justly implement certain laws and measures
intended to benefit them materially, such as:
"1. Immediate release of P680 million Secondary
Education Fund (SEF)
f r i n g e b e n e fi t s o f
teachers under Section
17 of Republic Act 6758.
2.  Clothing allowance at P500 to P1,000 per
teachers [sic] under the
General Appropriations
Act of 1990
3. DMB Circular 904
4.  Increase in minimum wage to P5,000 for
teachers." 40
And probably to clothe their action with permissible character, 41
they also raised national issues such as the removal of the U.S.
bases and the repudiation of foreign debt. In Balingasan vs. Court
of Appeals, 42 however, this Court said that the fact that the
conventional term "strike" was not used by the participants to
describe their common course of action was insignificant, since the
substance of the situation, and not its appearance, was deemed
controlling. 43
 
Moreover, the petitioners here, except Merlinda Jacinto, were not
penalized for the exercise of their right to assemble peacefully and
to petition the government for a redress of grievances. Rather, the
Civil Service Commission found them guilty of conduct prejudicial
to the best interest of the service for having absented themselves
without proper authority, from their schools during regular school
days, in order to participate in the mass protest, their absence
ineluctably resulting in the non-holding of classes and in the
deprivation of students of education, for which they were
responsible. Had petitioners availed themselves of their free time
— recess, after classes, weekends or holidays — to dramatize
their grievances and to dialogue with the proper authorities within
the bounds of law, no one — not the DECS, the CSC or even this
Court — could have held them liable for the valid exercise of their
constitutionally guaranteed rights. As it was, the temporary
stoppage of classes resulting from their activity necessarily
disrupted public services, the very evil sought to be forestalled by
the prohibition against strikes by government workers. Their act by
its nature was enjoined by the Civil Service law, rules and
regulations, for which they must, therefore, be made answerable.
Second Issue: Violation by Petitioner Jacinto
of Reasonable Office Rules and Regulations
Petitioner Jacinto, for her part, pleads for exoneration. She asks
the Court to reexamine and give due weight to the certification 44
issued by her school principal that she met her class on September
20, 1990 but failed to sign in the attendance logbook. Stated
elsewise, Jacinto wants us to scrutinize firsthand a document
already ruled upon by the Civil Service Commission and the Court
of Appeals to be of doubtful credibility. Time and again, we have
held that findings of administrative agencies, which have acquired
expertise because their jurisdiction is confined to specific matters,
are accorded not only respect but even finality 45 particularly when
affirmed by the appellate tribunal. It is not a function of this Court to
examine and evaluate the probative value of the evidence
proffered in the concerned forum, which formed the basis of the
latter's impugned decision, resolution or order, 46 absent a clear
showing of arbitrariness and want of any rational basis therefor. 47
In the instant case, we find no sufficient reason to reverse the
findings of the CSC.
In any event, as observed by the Commission, said certification,
dated December 19, 1990, was belatedly submitted by Petitioner
Jacinto only with her motion for reconsideration of the CSC
resolution promulgated September 21, 1993; thus, it was correctly
rejected as a newly discovered evidence. Additionally, the
Commission explained:
". . . such certification contradicts the allegation
that she filed an application for
leave. If she was really present on
September 20, 1990, there would
have been no need for her to file an
application for leave. Apparently,
this is a vain effort to present
documents of doubtful credibility
just to have Jacinto exonerated of
the charges against her." 48
The futility of the tactics of Petitioner Jacinto to evade culpability is
further exemplified by her contradictory assertions. In a sworn
explanation submitted to Secretary Cariño, she claimed that she
left the school premises on the day in question, because she "was
emotionally and mentally depressed," and went to see a physician.
49 In her motion for reconsideration before the CSC, she submitted
the above certification to the effect that she was not absent. Now,
in assailing the Commission's decision to reprimand her for
violation of reasonable office rules and regulations in not filing an
application for leave of absence, she invokes Sec. 15, Rule XVI of
the Civil Service rules, which provides:
"Sec. 15.  Applications for vacation leave of
absence for one full day or more
shall be submitted on the
prescribed form for action by the
proper chief of agency in advance,
whenever possible, of the effective
date of such leave."
She contends that the filing of an application for vacation leave
need not always be in advance of the effective date thereof. 50
Clearly, her present stance is diametric to her "illness" justification
before the DECS. In the latter case, it is Section 16 of said rules
that is pertinent:
"Sec. 16.  All applications for sick leaves of
absence for one full day or more
shall be on the prescribed form and
shall be filed immediately upon the
employee's return from such leave.
Notice of absence, however, should
be sent to the immediate supervisor
and/or to the office head. . . ."
The regulation requires (1) the filing of the application for sick leave investigation, if the charge against
on the prescribed form immediately upon the employee's return such officer or employee involves
from such leave and (2) a notice of absence to be sent to the dishonesty, oppression or grave
immediate supervisor and/or office head. But the Commission misconduct, or neglect in the
found that "the records are bereft of any showing that Jacinto performance of duty, or if there are
asked permission from school authorities to go out of school reasons to believe that the
premises and seek medical attention outside nor did she file an respondent is guilty of charges
application for sick leave . . ." 51 Hence, its conclusion that which would warrant his removal
petitioner violated reasonable office rules and regulations. from the service."
The totality of the evidence on record sustains the findings and
conclusions of the Commission, as affirmed by the Court of
Appeals. We have no reason to reverse them. The Civil Service
rules clearly provide that violation of reasonable office rules and
regulations, on first offense, carries the penalty of reprimand. 52 The petitioners' alleged lapses, initially found substantiated by the
Third Issue: No Right to Backwages DECS, qualify as grave misconduct or neglect in the performance
Petitioners anchor their claim for backwages on the supposed of duty under the above rule. Thus, former Education Secretary
illegality of (1) their preventive suspension upon the filing of the Cariño had the legal authority to suspend them pending further
charges against them and (2) the immediate execution of the investigation.
DECS Secretary's decisions ordering their dismissal. The Secretary's immediate execution of his decisions imposing the
The charges against petitioners consisted of the following: (1) penalty of dismissal finds legal basis in Sec. 47 (2) of the Civil
grave misconduct; (2) gross neglect of duty; (3) gross violation of Service law 54 which provides:
Civil Service law, rules and regulations and reasonable office "Sec. 47. Disciplinary Jurisdiction. — . . .
regulations; (4) refusal to perform official duty; (5) gross
insubordination; (6) conduct prejudicial to the best interest of the
service; and (7) absence without approved leave. These were
based on their alleged unauthorized participation in the mass
actions in September 1990, disregard of report-to-work directives, (2)  The Secretaries and heads of agencies and
unjustified abandonment of teaching posts, unauthorized absences instrumentalities, provinces, cities
without leave, and other similar violations reported to the DECS and municipalities shall have
Secretary by their respective school supervisors. 53 jurisdiction to investigate and
We find that the charges filed against petitioners warranted their decide matters involving
preventive suspension from the service, as provided under Section disciplinary action against officers
51, Chapter 7 (on Discipline) of the Administrative Code, which and employees under their
reads: jurisdiction. Their decisions shall be
"Sec. 51. Preventive Suspension. — The proper final in case the penalty imposed is
disciplining authority may suspension for not more than thirty
preventively suspend any days or fine in an amount not
subordinate officer or employee exceeding thirty days' salary. In
under his authority pending an case the decision rendered by a
 bureau or office head is appealable
to the Commission, the same may
be initially appealed to the
department and finally to the
Commission and pending appeal,
the same shall be executory except
when the penalty is removal, in
which case the same shall be
executory only after confirmation by
the Secretary concerned."
As can be gleaned from the above, the department secretary's
decision confirming the removal of an officer or employee under his
jurisdiction is executory in character, i.e. such decision may be
immediately executed even pending further remedy, such as an
appeal, 55 by the dismissed officer or employee. In the case at bar,
it was already the final judgments of Secretary Cariño which were
forthwith carried out. The aforequoted statutory provision rules out
the alleged illegality of the actions of the DECS Secretary.
In any event, the rule is settled that backwages may be granted
only to those who have been illegally dismissed and thenceforth
ordered reinstated, or to those acquitted of the charge against
them. 56 Even a pardoned convicted employee is not automatically
entitled to backpay. Monsanto vs. Factoran Jr. 57 established the
general rule that — while pardon has been commonly regarded as
eliminating the existence of guilt so that in the eyes of the law the
offender is as innocent as though he never committed the offense
— such exoneration does not operate for all purposes. It does not
erase the fact of the commission of the offense and the conviction
therefor. It frees the convict from all penalties and legal disabilities
and restores to him all his civil rights; but unless expressly
grounded on the person's innocence, it does not ipso facto restore
him to public office necessarily relinquished or forfeited by reason
of the conviction. Pardon does not generally result in automatic
reinstatement because the offender has to apply for reappointment;
neither is he entitled to backpay. 58
 
Thus, in Sabello vs. DECS, 59 although we reinstated the
petitioner-pardonee to his previous position in the interest of
"justice and equity," we did not grant him backwages since he "was
lawfully separated from the government service upon his conviction
for an offense." We reiterated that the right to backwages was
afforded only to those who were illegally dismissed but thereafter
ordered reinstated, or to those otherwise acquitted of the charge
against them.
Again, in City Mayor of Zamboanga vs. Court of Appeals, 60 we
said that "back salaries may be ordered paid to an officer or
employee only if he is exonerated of the charge against him and
his suspension or dismissal is found and declared to be illegal."
Hence, in Garcia vs. Chairman, Commission on Audit, 61 we said
that "if the pardon is based on the innocence of the individual, it
affirms this innocence and makes him a new man and as innocent
as if he had not been found guilty of the offense charged." 62 In
that case, Garcia was found administratively liable for dishonesty.
He was, however, acquitted by the trial court of the complaint for
qualified theft based on the very same acts. The acquittal was
founded not on lack of proof beyond reasonable doubt but on the
fact that he did not commit the offense imputed to him. This Court
said that after having been declared innocent of the criminal
complaint, which had the same basis as the administrative charge,
for all legal purposes the petitioner should not be considered to
have left his office, so that he was entitled to all the rights and
privileges that accrued to him by virtue of the office held, including
backwages. He was restored to his office ipso facto upon the
issuance of the clemency. The grant of backwages was justified "to
afford relief to [the] petitioner who [was] innocent from the start and
to make reparation for what he [had] suffered as a result of his
unjust dismissal from the service." 63
However, in Balingasan, finding that petitioners therein indeed
participated in the unlawful mass actions for which they were
similarly meted suspension, the Court opined that they were not
completely exonerated of the charges against them. They were
denied back salaries because they had given ground for their
suspension. This means that being found liable for a lesser offense
is not equivalent to exoneration from the original complaint against
the concerned public officer or employee. Balingasan referred to Regalado, Davide, Jr., Romero, Bellosillo, Melo, Puno, Vitug,
the earlier case of Yacia vs. City of Baguio, 64 in which this Court Kapunan, Mendoza and Francisco, JJ ., concur.
denied the claim of an employee for backwages for the period Narvasa, C .J ., is on official leave.
during which he was not allowed to work because of the execution  
of the CSC decision dismissing him for dishonesty, even though, ||| (Jacinto v. Court of Appeals, G.R. No. 124540, [November 14,
on appeal, his penalty was reduced to a fine equivalent to six 1997], 346 PHIL 656-681)
months' pay.
Based on the above premises, petitioners' demand for backwages
cannot be granted, for they had given cause for their suspension
— their unjustified abandonment of classes to the prejudice of their
students. Although they were eventually found guilty only of
conduct prejudicial to the best interest of the service, and not grave
misconduct or other offense warranting their dismissal from the
service, they were not fully innocent of the charges against them.
We find the case of Petitioner Jacinto different, however. The Civil
Service Commission found her culpable only of violation of
reasonable office rules and regulations, for not having asked
permission from school authorities to leave the school premises
and seek medical attention and for not filing an application for sick
leave for approval by the school authorities. There was no proof
that she joined the mass actions which caused prejudice to the
school system. In Balingasan, this Court, after finding that Rodolfo
Mariano was not involved in the mass actions but was absent
because he attended the wake and burial of his grandmother in
Ilocos Sur without however the benefit of an approved leave of
absence, held that "[t]o deny petitioner Mariano his back wages
during his suspension would be tantamount to punishing him after
his exoneration from the charges which caused his dismissal from
the service," i.e. participation in the unlawful mass actions.
Therefore, in line with Balingasan, we likewise grant back salaries
to Petitioner Jacinto who did not join the illegal activity. cdll
WHEREFORE, in view of the foregoing, the petition is hereby
DENIED and the assailed Decision of the Court of Appeals is
hereby AFFIRMED with the modification that Petitioner Merlinda
Jacinto is granted backwages, without deduction or qualification,
from the time she was suspended until her actual reinstatement,
the total of which, consistent with prevailing jurisprudence, 65
should not exceed five years.
SO ORDERED.
MASTER IRON LABOR UNION (MILU), WILFREDO
ABULENCIA, ROGELIO CABANA, LOPITO SARANILLA,
JESUS MOISES, BASILIO DELA CRUZ, EDGAR ARANES,
BASILIO DELA CRUZ, EDGAR ARANES, ELY BORROMEO,
DANIEL BACOLON, MATIAS PAJIMULA, RESTITUTO
PAYABYAB, MELCHOR BOSE, TEOFILO ANTOLIN, ROBERT
ASPURIA, JUSTINO BOTOR, ALFREDO FABROS, AGAPITO
TABIOS, BERNARDO ALFON, BENIGNO BARCENA,
BERNARDO ALFON, BENIGNO BARCENA BERNARDO
NAVARRO, MOISES LABRADOR, ERNESTO DELA CRUZ,
EDUARDO ESPIRITU, IGNACIO PAGTAMA, BAYANI PEREZ,
SIMPLICIO PUASO, EDWIN VELARDE, BEATO ABOGADO,
DANILO SAN ANTONIO, BERMESI BORROMEO and JOSE
BORROMEO, petitioners, vs. NATIONAL LABOR RELATIONS
COMMISSION and MASTER IRON WORKS AND
CONSTRUCTION CORPORATION, respondents.
Banzuela, Flores, Miralles, Rañeses, Sy, Taquio and Associates for
petitioners.
Carlos L. Galarrita for private respondent.
SYLLABUS
1.  LABOR AND SOCIAL LEGISLATION; LABOR RELATIONS;
ECONOMIC STRIKE; DEFINED. — As this Court has held in
Philippine Metal Foundries, Inc. vs. CIR (90 SCRA 135 [1979]), a
no-strike clause in a CBA is applicable only to economic strikes.
Corollarily, if the strike is founded on an unfair labor practice of the
employer, a strike declared by the union cannot be considered a
violation of the no-strike clause. An economic strike is defined as
one which is to force wage or other concessions from the employer
which he is not required by law to grant (Consolidated Labor
Association of the Philippines vs. Marsman & Co., Inc., 11 SCRA
589 [1964]). In this case, petitioners enumerated in their notice of
strike the following grounds: violation of CBA or the Corporation's
practice of subcontracting workers; discrimination; coercion of
employees; unreasonable suspension of union officials, and
unreasonable refusal to entertain grievance. Professor Perfecto
Fernandez, in his book Law on Strikes, Picketing and Lockouts
(1981 edition, pp. 144-145), states that an economic strike involves
issues relating to demands for higher wages, higher pension or
overtime rates, pensions, profit sharing, shorter working hours,
fewer work days for the same pay, elimination of night work, lower
retirement age, more healthful working conditions, better health
services, better sanitation and more safety appliances. The
demands of the petitioners, being covered by the CBA, are
definitely within the power of the Corporation to grant and therefore
the strike was not an economic strike.
2.  ID.; ID.; COLLECTIVE BARGAINING AGREEMENT;
PROVISION ON GRIEVANCE PROCEDURE THEREIN;
PURPOSE. — Private respondents failure to traverse petitioners'
allegation that the NLRC abused its discretion in holding that the
provision on grievance procedure had not been exhausted clearly
sustains such allegation and upholds the petitioners' contention
that the Corporation refused to undergo said procedure. It should
be remembered that a grievance procedure is part of the
continuous process of collective bargaining (Republic Savings
Bank vs. CIR, et al., 21 SCRA 226 [1967]). It is intended to
promote a friendly dialogue between labor and management as a
means of maintaining industrial peace. The Corporation's refusal to
heed petitioners' request to undergo the grievance procedure
clearly demonstrated its lack of intent to abide by the terms of the
CBA.
3. ID.; ID.; USE OF POLICE FORCE IN THE PICKET LINE; NOT
JUSTIFIED IN CASE AT BAR. — The bringing in of CAPCOM
soldiers to the peaceful picket lines without any reported outbreak
of violence, was clearly in violation of the following prohibited
activity under Article 264 of the Labor Code: "(d) No public official
or employee, including officers and personnel of the New armed
Forces of the Philippines or the Integrated National Police, or
armed person, shall bring in, introduce or escort in any manner any
individual who seeks to replace strikers in entering or leaving the
premises of a strike area, or work in place of the strikers. The
police force shall keep out of the picket lines unless actual violence
or other criminal acts occur therein: Provided, That nothing herein
shall be interpreted to prevent any public officer from taking any
measure necessary to maintain peace and order, protect life and
property, and/or enforce the law and legal order." As the Labor
Arbiter himself found, no pervasive or widespread coercion or
violence were perpetrated by the petitioners as to warrant the
presence of the CAPCOM soldiers in the picket lines. In this
regard, worth quoting is the following excerpt of the decision in
Shell Oil Workers' union vs. Shell Company of the Philippines, Ltd.,
39 SCRA 276 [1971], which was decided by the Court under the
old Industrial Peace Act but which excerpt still holds true: ". . .
What is clearly within the law is the concerted activity of cessation
of work in order that .. employer cease and desist from an unfair
labor practice. That the law recognizes as a right. There is though
a disapproval of the utilization of force to attain such an objective.
For implicit in the very concept of a legal order is the maintenance
of peaceful ways. A strike otherwise valid, if violent in character,
may be placed beyond the pale. Care is to be taken, however,
especially where an unfair labor practice is involved, to avoid
stamping it with illegality just because it is tainted by such acts. To
avoid rendering illusory the recognition of the right to strike,
responsibility in such a case should be individual and not
collective. A different conclusion would be called for, of course, if
the existence of force while the strike lasts is pervasive and
widespread, consistently and deliberately resorted to as a matter of
policy. It could be reasonably concluded then that even if justified
as to ends, it becomes illegal because of the means employed." (at
p. 292.)
4.  ID.; ID.; STRIKE; PRESUMPTION OF LEGALITY PREVAILS
EVEN IF THE ALLEGATION OF UNFAIR LABOR PRACTICES
ARE SUBSEQUENTLY FOUND TO BE UNTRUE. — The strike
staged by the petitioners was a legal one even though it may have
been called to offset what the strikers believed in good faith to be
unfair labor practices on the part of the employer (Ferrer et al. vs.
Court of Industrial Relations. et al., 17 SCRA 352 [1966]. Verily,
such presumption of legality prevails even if the allegations of
unfair labor practices are subsequently found out to be untrue
(People's Industrial and Commercial Employees and Workers Org.
[FFW] vs. People's Industrial and Commercial Corporation, 112
SCRA 440 [1982]). Consonant with these jurisprudential
pronouncements, is Article 263 of the Labor Code which clearly
states "the policy of the State to encourage free trade unionism
and free collective bargaining". Paragraph (b) of the same article
guarantees the workers' "right to engage in concerted activities for
purposes of collective bargaining or for their mutual benefit and
protection" and recognizes the "right of legitimate labor
organizations to strike and picket and of employers to lockout" so
long as these actions are "consistent with the national interest" and
the grounds therefor do not involve inter-union and intra-union
disputes.
5 .  I D . ; E M P L O Y E R - E M P L O Y E E R E L A T I O N S H I P ;
MANAGEMENT'S PREROGATIVE TO HIRE EMPLOYEES; NOT
ABSOLUTE. — While it is true that an employer's exercise of
management prerogatives, with or without reason, does not per se
constitute unjust discrimination, such exercise, if clearly shown to
be in grave abuse of discretion, may be looked into by the courts
(National Federation of Labor Unions vs. NLRC, 202 SCRA 346
[1991]). Indeed, the hiring, firing, transfer, demotion, and promotion
of employees are traditionally identified as management
prerogatives. However, they are not absolute prerogatives. They
are subject to limitations found in law, a collective bargaining
agreement, or general principles of fair play and Justice (University
of Sto. Tomas vs. NLRC, 190 SCRA 758 [1990] citing Abbott
Laboratories [Phil.]. Inc. vs. NLRC, 154 SCRA 713 [1987]. The
Corporation's assertion that it was exercising a management
prerogative in hiring outside workers being contrary to the contract
of employment which, of necessity, states the expected wages of
the workers, as well as the CBA, is therefore untenable.
6.  ID.; REINSTATEMENT; PROPER, IN CASE OF ILLEGALLY
DISMISSED EMPLOYEE. — The strike being legal, the NLRC
gravely abused its discretion in terminating the employment of the
individual petitioners, who, by operation of law, are entitled to
reinstatement with three years backwages. Republic Act No. 6715
which amended Art. 279 of the Labor Code by giving "full
backwages inclusive of allowances" to reinstated employees, took
effect fifteen days from the publication of the law on March 21,
1989. The decision of the Labor Arbiter having been promulgated
on March 16, 1988, the law is not applicable in this case.
DECISION
MELO, J p:
The petition for certiorari before us seeks to annul and to set aside
the decision of the National Labor Relations Commission (Second
Division) dated July 12, 1956 which affirmed that of Labor Arbiter
Fernando V. Cinco declaring illegal the strike staged by petitioners
and terminating the employment of the individual petitioners.
The Master Iron Works Construction Corporation (Corporation for
brevity) is a duly organized corporate entity engaged in steel
fabrication and other related business activities. Sometime in
February 1987, the Master Iron Labor Union (MILU) entered into a
collective bargaining agreement (CBA) with the Corporation for the
three-year period between December 1, 1986 and November 30,
1989 (Rollo, p. 7). Pertinent provisions of the CBA state:
"SECTION 1.  That there shall be no strike and
no lockout, stoppage or shutdown
of work, or any other interference
with any of the operation of the
COMPANY during the term of this
AGREEMENT, unless allowed and
permitted by law."
"SECTION 2.  Service Allowance. — The
COMPANY agrees to continue the
granting of service allowance of
workers assigned to work outside
the company plant, in addition to
his daily salary, as follows:
 
(a)  For those
assigned to work outside
the plant but within Metro
Manila, the service
allowance shall be
P12.00;
(b)  For those
assigned to work outside
Metro Manila, the service
allowance shall be
P25.00/day;
( c )  The
present practice of
conveying to and from
the jobsites of workers
assigned to work outside
of the company plant
shall be maintained."
Right after the signing of the CBA, the Corporation subcontracted
outside workers to do the usual jobs done by its regular workers
including those done outside of the company plant. As a result, the
regular workers were scheduled by the management to work on a
rotation basis allegedly to prevent financial losses thereby allowing
the workers only ten (10) working days a month (Rollo, p. 8). Thus,
MILU requested implementation of the grievance procedure which
had also been agreed upon in the CBA, but the Corporation
ignored the request.
Consequently, on April 8, 1987, MILU filed a notice of strike (Rollo,
p. 54) with the Department of Labor and Employment. Upon the
intervention of the DOLE, through one Atty. Bobot Hernandez, the
Corporation and MILU reached an agreement whereby the
Corporation acceded to give back the usual work to its regular
employees who are members of MILU (Rollo, p. 55).
Notwithstanding said agreement, the Corporation continued the
practice of hiring outside workers. When the MILU president,
Wilfredo Abulencia, insisted in doing his regular work of cutting
steel bars which was being done by casual workers, a supervisor
reprimanded him, charged him with insubordination and Master Iron Works & Construction Corp.
suspended him for three (3) days (Rollo, pp. 9 & 51-52). Upon the
request of MILU, Francisco Jose of the DOLE called for conciliation
conferences. The Corporation, however, insisted that the hiring of
casual workers was a management prerogative later ignored
subsequent scheduled conciliation conferences (Rollo, pp. 51-52 & 790 Bagbagin, Caloocan City
57-58).
Hence, on July 9, 1987, MILU filed a notice of strike on the
following grounds: (a) violation of CBA; (b) discrimination; (c)
unreasonable suspension of union officials; and (d) unreasonable
refusal to entertain grievance (Rollo, p. 9). On July 24, 1987, MILU Dear Sir,
staged the strike, maintaining picket lines on the road leading to
the Corporation's plant entrance and premises.
At about 11 o'clock in the morning of July 28, 1987, CAPCOM
soldiers, who had been summoned by the Corporation's counsel,
came and arrested the picketers. They were brought to Camp Ang unyon, sa pamamagitan ng nakalagda sa
Karingal and, the following day, to the Caloocan City jail. Charges ibaba, ay nagmumungkahi,
for illegal possession of firearms and deadly weapons were lodged nagsusuhestiyon o nag-oofer sa
against them. Later, however, those charges were dismissed for inyong pangasiwaan ng aming
failure of the arresting CAPCOM soldiers to appear at the kahilingan na bumalik na sa
investigation (Rollo, p. 10). The dispersal of the picketlines by the trabaho dahilan din lang sa
CAPCOM also resulted in the temporary lifting of the strike. kalagayan na tuloy tuloy ang ating
On August 4, 1987, the Corporation filed with the NLRC National pag-uusap para sa ikatitiwasay ng
Capital Region arbitration branch a petition to declare the strike ating relasyon. Gusto naming
illegal (Rollo, p. 40). On September 7, 1987, MILU, with the manatili ang ating magandang —
assistance of the Alyansa ng Manggagawa sa Valenzuela (AMVA), pagtitinginan bilang magkasangga
re-staged the strike. Consequently, the Corporation filed a petition para sa ika-uunlad ng ating
for injunction before the NLRC which, on September 24, 1987, kumpanya. Sana ay unawain niyo
issued an order directing the workers to remove the barricades and kami dahil kailangan namin ng
other obstructions which prevented ingress to and egress from the trabaho.
company premises. The workers obliged on October 1, 1987
(Rollo, p. 25). On October 22, 1987, through its president, MILU
offered to return to work in a letter which states:
"22 Okt. 1987
G u
magalang,

Mr. Elieze Hao

 (Sg 2.  Ordering the cancellation of the registered
d.)WILFREDO ABULENCIA permit of respondent union MILU
for having committed an illegal
strike;

P a
ngulo"
3.  Ordering the termination of employment
status of the individual
respondents, including the
forfeiture of whatever benefits are
(Rollo, p. 590). due them under the law, for having
actively participated in an illegal
strike, namely: Wilfredo Abulencia,
President; Rogelio Cabana, Vice-
President; Lopito Saranilla,
On October 30, 1987, MILU filed a position paper with counter- Secretary; Jesus Moises,
complaint before the NLRC. In said counter-complaint, the workers Treasurer; Basilio dela Cruz,
charged the Corporation with unfair labor practice for Auditor; as Members of the Board:
subcontracting work that was normally done by its regular workers Edgar Aranes, Melchor Bose
thereby causing the reduction of the latter's workdays; illegal Restituto Payabyab, Matias
suspension of Abulencia without any investigation; discrimination Pajimula, Daniel Bacolon, and Ely
for hiring casual workers in violation of the CBA, and illegal Borromeo, as Members of the
dispersal of the picket lines by CAPCOM agents (Rollo, pp. 26-27). Union: Teofilo Antolin, Robert
In due course, a decision dated March 16, 1988 was rendered by Aspuria, Justino Botor, Alfredo
Labor Arbiter Fernando Cinco declaring illegal the strike staged by Fabros, Agapito Tabios, Bernardo
MILU. The dispositive portion of the decision reads: Alfon, Benigno Barcena, Bernardo
"WHEREFORE, in the light of the foregoing Navarro, Moises Labrador, Ernesto
premises, judgment is hereby dela Cruz, Eduardo Espiritu,
rendered, as follows: Ignacio Pagtama Bayani Perez,
Simplicio Puaso, Edwin Velarde,
Beato Abogado, Danilo San
Antonio, Bermes Borromeo, and
Jose Borromeo.
1. Declaring the strike by the respondents illegal
and unlawful;
The respondents as appearing in Annex `A' of
the Petition, but not included as
among those whose employment
status were terminated as above-
mentioned, are given priority of
reinstatement, without backwages,
in the petitioner starts its normal
operations, or shall be paid their
separation pay according to law.
4. Ordering the respondents to cease and desist
from further committing the illegal
acts complained of;
5.  Ordering Respondent Union to pay the
amount of P10,000.00 to
Petitioner's Counsel as attorney's
fees;
6.  Ordering the dismissal of the claim for
damages for lack of merit; and
7.  Ordering the dismissal of the counter-
complaint in view of the filing of a
separate complaint by the
respondents.
SO ORDERED." (pp. 35-36, Rollo.)
On appeal to the NLRC, MILU and the individual officers and
workers named in Labor Arbiter Cinco's decision alleged that said
labor arbiter gravely abused his discretion and exhibited bias in
favor of the Corporation in disallowing their request to cross-
examine the Corporation's witnesses, namely, Corporate Secretary
Eleazar Hao, worker Daniel Ignacio and foreman Marcial Barcelon,
who all testified on the manner in which the strike was staged and
on the coercion and intimidation allegedly perpetrated by the
strikers (Rollo, p. 151).
The Second Division of the NLRC affirmed with modifications the
decision of the labor arbiter. The decision, which was promulgated
on July 12, 1989 with Commissioners Domingo H. Zapanta and
Oscar N. Abella concurring and Commissioner Daniel M. Lucas, Jr.
dissenting, disagreed with the labor arbiter on the "summary
execution of the life of Master Iron Labor Union (MILU)" on the
grounds that the Corporation did not specifically pray for the
cancellation of MILU's registration and that pursuant to Articles 239
and 240 of the Labor Code, only the Bureau of Labor Relations
may cancel MILU's license or certificate of registration. It also
deleted the award of P10,000.00 as attorney's fees for lack of
sufficient basis but it affirmed the labor arbiter with regard to the
declaration of illegality of the strike and the termination of
employment of certain employees and the rest of the dispositive
portion of the labor arbiter's decision (Rollo, pp. 48-49).
In his dissent, Commissioner Lucas stated that he is "for the setting
aside of the decision appealed from, and remanding of the case to
the labor arbiter of origin, considering that respondent's
countercharge or complaint for unfair labor practice was not
resolved on the merits" (Rollo, p. 49).
MILU filed a motion for the reconsideration but the same was
denied by the NLRC for lack of merit in its Resolution of August 9,
1989 (Rollo, p. 50).
Hence, the instant petition. 1
Petitioners contend that notwithstanding the non-strike provision in
the CBA, the strike they staged was legal because the reasons
therefor are non-economic in nature. They assert that the NLRC
abused its discretion in holding that there was "failure to exhaust
the provision on grievance-procedure" in view of the fact that they
themselves sought grievance meetings but the Corporation ignored
such requests. They charge the NLRC with bias in failing to give
weight to the fact that the criminal charges against the individual
petitioners were dismissed for failure of the CAPCOM soldiers to
testify while the same individual strikers boldly faced the charges
against them. Lastly, they aver that the NLRC abused its discretion
in holding that the worker's offer to return to work was conditional.
In holding that the strike was illegal, the NLRC relied solely on the
no-strike no-lockout provision of the CBA aforequoted. As this
Court has held in Philippine Metal Foundries, Inc. vs. CIR (90
SCRA 135 [1979]), a no-strike clause in a CBA is applicable only to
economic strikes. Corollarily, if the strike is founded on an unfair
labor practice of the employer, a strike declared by the union
cannot be considered a violation of the no-strike clause.
An economic strike is defined as one which is to force wage or
other concessions from the employer which he is not required by
law to grant (Consolidated Labor Association of the Philippines vs.
Marsman & Co., Inc., 11 SCRA 589 [1964]). In this case,
petitioners enumerated in their notice of strike the following
grounds: violation of CBA or the Corporation's practice of
subcontracting workers; discrimination; coercion of employees;
unreasonable suspension of union officials, and unreasonable
refusal to entertain grievance.
 
Private respondent contends that petitioners' clamor for the
implementation of Section 2, Article VIII of the CBA on service
allowances granted to workers who are assigned outside the
company premises is an economic issue (Rollo, p. 70). On the
contrary, petitioners decry the violation of the CBA, specifically the
provision granting them service allowances. Petitioners are not,
therefore, already asking for an economic benefit not already
agreed upon, but are merely asking for the implementation of the
same. They aver that the Corporation's practice of hiring
subcontractors to do jobs outside of the company premises was a
way "to dodge paying service allowance to the workers" (Rollo, pp.
61 & 70).
Much more than an economic issue, the said practice of the
Corporation was a blatant violation of the CBA — an unfair labor
practice on the part of the employer under Article 248(i) of the
Labor Code. Although the end result, should the Corporation be
required to observe the CBA, may be economic in nature because
the workers would then be given their regular working hours and
therefore their just pay, not one of the said grounds is an economic
demand within the meaning of the law on labor strikes. Professor
Perfecto Fernandez, in his book Law on Strikes, Picketing and
Lockouts (1981 edition, pp. 144-145), states that an economic
strike involves issues relating to demands for higher wages, higher
pension or overtime rates, pensions, profit sharing, shorter working
hours, fewer work days for the same pay, elimination of night work,
lower retirement age, more healthful working conditions, better
health services, better sanitation and more safety appliances. The
demands of the petitioners, being covered by the CBA, are
definitely within the power of the Corporation to grant and therefore
the strike was not an economic strike.
The other grounds, i.e., discrimination, unreasonable suspension
of union officials and unreasonable refusal to entertain grievance,
had been ventilated before the Labor Arbiter. They are clearly
unfair labor practices as defined in Article 248 of the Labor Code. 2
The subsequent withdrawal of petitioners' complaint for unfair labor
practice (NLRC-NCR Case No. 00-11-04132-87) which was
granted by Labor Arbiter Ceferina Diosana who also considered
the case closed and terminated (Rollo, pp. 97 & 109) may not,
therefore, be considered as having converted their other
grievances into economic demands.
Moreover, petitioners staged the strike only after the Corporation
had failed to abide by the agreement forged between the parties
upon the intervention of no less than the DOLE after the union had
complained of the Corporation's unabated subcontracting of
workers who performed the usual work of the regular workers. The
Corporation's insistence that the hiring of casual employees is a
management prerogative betrays its attempt to coat with legality
the illicit curtailment of its employees' rights to work under the
terms of the contract of employment and to a fair implementation of In the same manner, the following findings of the Labor Arbiter
the CBA. showed the illegal breakup of the picket lines by the CAPCOM:
While it is true that an employer's exercise of management "d)  On 28 July 1987, CAPCOM soldiers, on
prerogatives, with or without reason, does not per se constitute surveillance mission, arrived at the
unjust discrimination, such exercise, if clearly shown to be in grave picket line of respondents and
abuse of discretion, may be looked into by the courts (National searches were made on reported
Federation of Labor Unions vs. NLRC, 202 SCRA 346 [1991]). deadly weapons and firearms in the
Indeed, the hiring, firing, transfer, demotion, and promotion of possession of the strikers. Several
employees are traditionally identified as management prerogatives. bladed weapons and firearms in the
However, they are not absolute prerogatives. They are subject to possession of the strikers were
limitations found in law, a collective bargaining agreement, or confiscated by the CAPCOM
general principles of fair play and Justice (University of Sto. Tomas soldiers, as a result of which, the
vs. NLRC, 190 SCRA 758 [1990] citing Abbott Laboratories [Phil.]. apprehended strikers were brought
Inc. vs. NLRC, 154 SCRA 713 [1987]. The Corporation's assertion to Camp Tomas Karingal in Quezon
that it was exercising a management prerogative in hiring outside City for proper investigation and
workers being contrary to the contract of employment which, of filing of the appropriate criminal
necessity, states the expected wages of the workers, as well as the charges against them. The strikers
CBA, is therefore untenable. who were charged of illegal
Private respondents failure to traverse petitioners' allegation that possession of deadly weapon and
the NLRC abused its discretion in holding that the provision on firearms were: Edgar Aranes,
grievance procedure had not been exhausted clearly sustains such Wilfredo Abulencia, Ernesto dela
allegation and upholds the petitioners' contention that the Cruz, Beato Abogado, Lopito
Corporation refused to undergo said procedure. It should be Saranilla, Restituto Payabyab, Jose
remembered that a grievance procedure is part of the continuous Borromeo and Rogelio Cabana.
process of collective bargaining (Republic Savings Bank vs. CIR, Criminal informations were filed by
et al., 21 SCRA 226 [1967]). It is intended to promote a friendly Inquest Fiscal, marked as Exhibits
dialogue between labor and management as a means of `E', `E-1 to E-B'. These strikers
maintaining industrial peace. The Corporation's refusal to heed were jailed for sometime until they
petitioners' request to undergo the grievance procedure clearly were ordered released after putting
demonstrated its lack of intent to abide by the terms of the CBA. up the required bail bond. Other
Anent the NLRC's finding that Abulencia's offer to return to work is strikers were also arrested and
conditional, even a cursory reading of the letter aforequoted would brought to Camp Tomas Karingal,
reveal that no conditions had been set by petitioners. It is and after proper investigation as to
incongruous to consider as a "condition" the statement therein that their involvement in the offense
the parties would continue talks for a peaceful working relationship charged, they were released for
("tuloy tuloy ang ating pag-uusap sa ikatitiwasay ng ating lack of prima facie evidence. They
relasyon"). Conferences form part of the grievance procedure and are Edwin Velarde, Bayani Perez,
their mere mention in Abulencia's letter did not make the same Daniel Bacolon, Jesus Moises,
"conditional".
 Robert Aspurias and Benigno
Barcena.
After the strikers who were arrested were
brought to Camp Tomas Karingal
on 28 July 1987, the rest of the
strikers removed voluntarily their
human and material barricades
which were placed and posted at
the road leading to the premises of
the Company." (Rollo, p. 32).
The bringing in of CAPCOM soldiers to the peaceful picket lines
without any reported outbreak of violence, was clearly in violation
of the following prohibited activity under Article 264 of the Labor
Code:
"(d)  No public official or employee, including
officers and personnel of the New
armed Forces of the Philippines or
the Integrated National Police, or
armed person, shall bring in,
introduce or escort in any manner
any individual who seeks to replace
strikers in entering or leaving the
premises of a strike area, or work in
place of the strikers. The police
force shall keep out of the picket
lines unless actual violence or other
criminal acts occur therein:
Provided, That nothing herein shall
be interpreted to prevent any public
officer from taking any measure
necessary to maintain peace and
order, protect life and property, and/
or enforce the law and legal
order." (Emphasis supplied.)
As the Labor Arbiter himself found, no pervasive or widespread
coercion or violence were perpetrated by the petitioners as to
warrant the presence of the CAPCOM soldiers in the picket lines.
In this regard, worth quoting is the following excerpt of the decision
in Shell Oil Workers' Union vs. Shell Company of the Philippines,
Ltd., 39 SCRA 276 [1971], which was decided by the Court under
the old Industrial Peace Act but which excerpt still holds true:
". . . What is clearly within the law is the
concerted activity of cessation of
work in order that .. employer
cease and desist from an unfair
labor practice. That the law
recognizes as a right. There is
though a disapproval of the
utilization of force to attain such an
objective. For implicit in the very
concept of a legal order is the
maintenance of peaceful ways. A
strike otherwise valid, if violent in
character, may be placed beyond
the pale. Care is to be taken,
however, especially where an unfair
labor practice is involved, to avoid
stamping it with illegality just
because it is tainted by such acts.
To avoid rendering illusory the
recognition of the right to strike,
responsibility in such a case should
be individual and not collective. A
different conclusion would be called
for, of course, if the existence of
force while the strike lasts is
 pervasive and widespread, having been promulgated on March 16, 1988, the law is not
consistently and deliberately applicable in this case.
resorted to as a matter of policy. It WHEREFORE, the questioned decision and resolution of the
could be reasonably concluded NLRC as well as the decision of the Labor Arbiter are hereby SET
then that even if justified as to ASIDE and the- individual petitioners are reinstated to their
ends, it becomes illegal because of positions, with three years backwages and without loss of seniority
the means employed." (at p. 292.) rights and other privileges. Further, respondent corporation is
ordered to desist from subcontracting work usually performed by its
regular workers.
SO ORDERED.
Feliciano, Bidin, Davide, Jr. and Romero, JJ . concur.
All told, the strike staged by the petitioners was a legal one even Gutierrez, Jr., J ., On terminal leave.
though it may have been called to offset what the strikers believed  
in good faith to be unfair labor practices on the part of the employer ||| (Master Iron Labor Union v. National Labor Relations
(Ferrer et al. vs. Court of Industrial Relations. et al., 17 SCRA 352 Commission, G.R. No. 92009, [February 17, 1993])
[1966]. Verily, such presumption of legality prevails even if the
allegations of unfair labor practices are subsequently found out to
be untrue (People's Industrial and Commercial Employees and
Workers Org. [FFW] vs. People's Industrial and Commercial
Corporation, 112 SCRA 440 [1982]). Consonant with these
jurisprudential pronouncements, is Article 263 of the Labor Code
which clearly states "the policy of the State to encourage free trade
unionism and free collective bargaining". Paragraph (b) of the
same article guarantees the workers' "right to engage in concerted
activities for purposes of collective bargaining or for their mutual
benefit and protection" and recognizes the "right of legitimate labor
organizations to strike and picket and of employers to lockout" so
long as these actions are "consistent with the national interest" and
the grounds therefor do not involve inter-union and intra-union
disputes.
 
The strike being legal, the NLRC gravely abused its discretion in
terminating the employment of the individual petitioners, who, by
operation of law, are entitled to reinstatement with three years
backwages. Republic Act No. 6715 which amended Art. 279 of the
Labor Code by giving "full backwages inclusive of allowances" to
reinstated employees, took effect fifteen days from the publication
of the law on March 21, 1989. The decision of the Labor Arbiter
PHILIPPINE AIRLINES, INC., petitioner, vs. THE HON. ACTING
SECRETARY OF LABOR JOSE S. BRILLANTES and THE
PHILIPPINE AIRLINES EMPLOYEES' ASSOCIATION,
respondents.
Estelito P. Mendoza for petitioner.
Adolpho M. Guerzon for PALEA.
SYNOPSIS
This is the resolution of the motion for reconsideration of the
November 18, 1996 resolution of the Court dismissing the petition
for certiorari filed by Philippine Airlines, Inc. (PAL), seeking the
termination of certain members and officers of respondent union
PAL Employees' Association (PALEA), for staging a strike in
violation of the Secretary of Labor's return to work order. The Court
upheld the order of the respondent acting Secretary of Labor which
meted only the penalty of suspension upon the aforementioned
union officers and members. According to PAL, the order of
suspension is tagged as a violation of Article 264 of the Labor
Code, and contradicts previous decisions of the Court upon said
provision. cdasia
The Court emphasized that the particular circumstance that sets
this case apart from previous instances of labor disputes cited by
petitioner, where the striking union members were dismissed after
breaking the return to work order issued by the Secretary of Labor,
is PAL's mass termination of 183 union officers and members of 6
July 1994 in violation of the Court's cease and desist order. It is for
this reason that the Court decided not to mete upon the concerned
officers and members the capital punishment of dismissal from
office, notwithstanding the law's sanction for such a consequence.
PAL did not go to Court with clean hands in seeking justice.
Motion denied.
SYLLABUS
LABOR AND SOCIAL LEGISLATION; LABOR RELATIONS;
STRIKES AND LOCKOUTS; IN THE INSTANT CASE, THE
COURT INVOKES ITS JUDICIAL PREROGATIVE TO RESOLVE
DISPUTES IN A WAY TO RENDER EACH INTERESTED PARTY
THE MOST JUDICIOUS SOLUTION, AND IN THE ULTIMATE
SCHEME A RESOLUTION OF A DISPUTE TENDING TO
PRESERVE THE GREATER ORDER OF SOCIETY. — In the
instant case, there is no doubting the validity of our observation
that in the collective bargaining process, not only PALEA, but both
parties contributed to the volatile atmosphere emerging despite the
Secretary of Labor's status quo order, disrupting thereby the
orderly continuance of negotiations. As observed by the Acting
Secretary of Labor in his March 9, 1996 Order, "PAL did not come
to this Office with clean hands' in seeking the termination of the
officers and members of PALEA who participated in the 16 June
1994 strike. As the records will show, PAL terminated en masse the
employment of 183 union officers and members of PALEA on 6
July 1994 in violation of our 3 June 1994 Order enjoining the
parties to cease and desist from committing any and all that might
exacerbate the situation." It is for this reason that we decided not to
mete upon the concerned members and officers of PALEA the
capital punishment of dismissal from office, notwithstanding the
law's sanction for such a consequence. This particular
circumstances sets this case apart from previous instances of labor
disputes cited by the petitioner, where the striking union officers
were dismissed after breaking the return to work order issued by
the Secretary of Labor. Moreover, in the instant case, the Court
invokes its judicial prerogative to resolve disputes in a way to
render to each interested party the most judicious solution, and in
the ultimate scheme, a resolution of a dispute tending to preserve
the greater order of society. Thus we declared in our November 18,
1996 resolution, the peculiar nature of the judicial treatment of
labor disputes urges the arbiter of the issues involved to maintain a
careful eye, if not a caring hand, to the interests of the parties,
such that industrial peace and labor-management stability is
preserved. Private respondents, in the meantime, made it known to
the Court that the union officers who have been suspended for
twelve months and the other members of the union who have been
suspended for eight months, in accordance with the Secretary of
Labor's order, have not been returned to service until this time.
These union officers and members should be immediately
reinstated and paid their backwages and other accrued benefits,
counted from the time they have served their respective
suspensions until actual reinstatement undiminished by earnings
derived elsewhere during the period of their suspension, in
accordance with latest jurisprudence affirming such intent of the
legislature. STHAID
RESOLUTION
TORRES, JR., J p:
In Our Resolution dated November 18, 1996, the Court dismissed
the instant petition for certiorari filed by Philippine Airlines, Inc
(PAL), seeking the termination from employment of certain
members and officers of the respondent union PAL Employees'
Association (PALEA), for staging a strike in violation of the
Secretary of Labor' s return to work order.
In doing so, we upheld the March 9, 1995 Order of the respondent
Acting Labor Secretary Jose S. Brillantes which meted the penalty
of suspension upon eighteen (18) PALEA officers and members for
eight months, and directing PAL to reinstate them to their
respective posts after they have served their suspension.
The dispositive portion of our decision reads:
"With the denial of the prayer for issuance of a
writ of preliminary injunction on
June 26, 1995, the court takes note
that the union officers concerned
have since served their
suspensions and returned to
service.
"WHEREFORE, in view of the foregoing
considerations, the court hereby
resolved to DISMISS the petition
for certiorari that is G.R. No.
11 9 3 6 0 . T h e O r d e r o f t h e
respondent Honorable Acting
Secretary of Labor Jose S.
Brillantes is hereby AFFIRMED.
On December 27, 1996, PAL filed a Motion for Reconsideration,
taking exception to the Court's affirmation of the Acting Secretary's
Order. The order for the suspension of the eighteen PALEA officers
and members is tagged as a violation of Article 264 of the Labor
Code, and contradicts previous decisions of the Court upon the
said provision, including; Philippine Airlines, Inc. vs. Drilon, et. al.
(193 SCRA 223, 1991); Union of Filipro Employees vs. Nestle
Philippines, Inc. (192 SCRA 396, 1990); Federation of Free
Workers vs. Inciong (208 SCRA 157, 1992); St. Scholastica's
College vs. Torres (210 SCRA 565, 1992)
Clearly, the unequivocal rule laid down by the foregoing is that:
"A strike that is undertaken despite the issuance
by the Secretary of Labor of an
assumption and/or certification is a
prohibited activity and thus illegal.
The union officers and members,
as a result, are deemed to have
lost their employment status for
having knowingly participated in an
illegal act. Stated differently, from
the moment a worker defies a
return-to-work order, he is deemed
to have abandoned his job. The
loss of employment status results
from the striking employees' own
act — an act which is illegal, an act
in violation of the law and in
defiance of authority."
The loss of employment status allegedly results from the
application of the second and third paragraphs of Article 264 of the
Labor Code, which, petitioner posits, is mandatory.
"Art. 264. . . .

"SO ORDERED."
No strike or lockout shall be declared after
assumption of jurisdiction by the
President or the Minister or after
certification election or submission
of the dispute to compulsory or
voluntary arbitration or during the
pendency of cases involving the
same grounds for the strike or
lockout.
Any worker whose employment has been
terminated as a consequence of an
unlawful lockout shall be entitled to
reinstatement with full backwages.
Any 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.
xxx xxx xxx
The Court need not dwell on the hermeneutics of the
abovementioned provision of law.
The cases cited by the petitioner leave no doubt as to the policy of
the state not to tolerate actions directed at the destabilization of the
social order, where the relationship between labor and
management has been endangered by abuse of one party's
bargaining prerogative, to the extent of disregarding not only the
direct order of the government to maintain the status quo, but the
welfare of the entire workforce, though they may not be involved in
the dispute. The grave penalty of dismissal visited upon the guilty
parties was a natural consequence, considering the interest of
public welfare.
In the instant case, there is no doubting the validity of our
observation that in the collective bargaining process, not only
PALEA, but both parties contributed to the volatile atmosphere
emerging despite the Secretary of Labor's status quo order,
disrupting thereby the orderly continuance of negotiations. As
observed by the Acting Secretary of Labor in his March 9, 1996
Order, "PAL did not come to this Office with 'clean hands' in
seeking the termination of the officers and members of PALEA who
participated in the 16 June 1994 strike. As the records will show,
PAL terminated en masse the employment of 183 union officers
and members of PALEA on 6 July 1994 in violation of our 3 June
1994 Order enjoining the parties to cease and desist from
committing any and all acts that might exacerbate the situation." It
is for this reason that we decided not to mete upon the concerned
members and officers of PALEA the capital punishment of
dismissal from office, notwithstanding the law's sanction for such a
consequence.
This particular circumstance sets this case apart from previous
instances of labor disputes cited by the petitioner, where the
striking union officers were dismissed after breaking the return to
work order issued by the Secretary of Labor. Moreover, in the
instant case, the Court invokes its judicial prerogative to resolve
disputes in a way to render to each interested party the most
judicious solution, and in the ultimate scheme, a resolution of a
dispute tending to preserve the greater order of society.
Thus we declared in our November 18, 1996 resolution, the
peculiar nature of the judicial treatment of labor disputes urges the
arbiter of the issues involved to maintain a careful eye, if not a
caring hand, to the interests of the parties, such that industrial
peace and labor-management stability is preserved.
Private respondents, in the meantime, made it known to the Court
that the union officers who have been suspended for twelve
months and the other members of the union who have been
suspended for eight months, in accordance with the Secretary of
Labor's order, have not been returned to service until this time.
These union officers and members should be immediately
reinstated and paid their backwages and other accrued benefits,
counted from the time they have served their respective
suspensions until actual reinstatement, undiminished by earnings
derived elsewhere during the period of their suspension, in
accordance with latest jurisprudence 1 affirming such intent of the
legislature. cdrep
WHEREFORE, in view of the foregoing, the Court hereby
RESOLVED to DENY, with finality, the motion for reconsideration
filed by the petitioner Philippine Airlines, Inc. Petitioner is hereby
ORDERED to REINSTATE the union members ordered suspended
for twelve months and eight months respectively under the Acting
Secretary of Labor's March 9, 1995 order, and to PAY them full
backwages and other benefits due, from the time their suspensions
have been served until their actual reinstatement.
SO ORDERED.
Regalado and Puno, JJ ., concur.
 
||| (Philippine Airlines, Inc. v. Brillantes, G.R. No. 119360
(Resolution), [October 10, 1997], 345 PHIL 756-761)