LABOR 2020 – M.

TAN
(Nippon Express Philippines Corp. vs. Marie Jean Daguiso, G.R. 217970, June 17, 2020).

ON June 4, 2012, respondent Marie Jean Daguiso filed a complaint for illegal dismissal against petitioner
Nippon Express Philippines Corp. (NEPC) and its officers. Acting on her complaint, the Labor Arbiter (LA) found
merit in it and awarded her full backwages, separation pay and nominal damages. Not fully satisfied with the
decision, she appealed before the National Labor Relations Commission (NLRC) contending among others, that
the LA gravely abused his discretion in not ordering her reinstatement. The NLRC affirmed the LA’s award of
separation pay in lieu of reinstatement reasoning that there already exists an atmosphere of antagonism and
antipathy between the parties, especially between Daguiso and her immediate supervisor, Yolanda G. De Vera
whom she wanted to be solidarily liable with NEPC. There was also a shouting match between Daguiso and
Dianne Aguirre, human resource specialist.

The Court of Appeals (CA) found that the NLRC gravely abused its discretion in not ordering the reinstatement
of Daguiso.

Whether the Court of Appeals (CA) erred in ordering the reinstatement of Daguiso.

Ruling: No.

We agree with the Court of Appeals that the NLRC gravely abused its discretion in ruling against the
reinstatement of Daguiso due to strained relations on these bases: (1) Daguiso’s resentment toward senior
manager De Vera was apparent when she insisted in her appeal that De Vera be held personally liable for her
illegal dismissal; and (2) Daguiso did not deny that she was involved in a shouting match with her subordinate,
Aguirre, which shows that Daguiso’s continuance in her employment could not foster a harmonious workplace.

First, it must be emphasized that Daguiso was dismissed without just cause and without due process as ruled
by the LA. The NEPC did not appeal the decision of the LA, which implies its acquiescence to the LA’s findings.
Second, the NEPC failed to prove with substantial evidence that Daguiso committed an act in the performance
of her duties which justifies its loss of confidence in her to merit the NLRC’s reasoning that “it would be unjust to
compel respondents-appellees to maintain in their employ complainant-appellant (Daguiso), in whom they have
already lost their trust and confidence.Third, we have discussed that to deny Daguiso reinstatement due to
“strained relations” between her and senior manager De Vera would be an injustice to Daguiso, the one
bypassed by De Vera. The NEPC failed to present competent evidence as basis for concluding that its
relationship with Daguiso has reached a point where it is best severed. In fact, Daguiso asks to be reinstated.

The doctrine of strained relations should not be applied indiscriminately to cause the non-reinstatement of a
supervisory employee who is dismissed without just cause and without due process by the employer due to an
altercation caused by its senior officer who bypassed the dismissed employee. An employee’s occupation is
his/her means of livelihood, which is a precious economic right; hence, it should not just be taken away from the
employee by applying the exception of “strained relations” that is not justified. The State guarantees security of
tenure to workers; thus, all efforts must be exerted to protect a worker from unjust deprivation of his/her job.

Pedrito R. Parayday and Jaime Reboso vs. Shogun Shipping Co. Inc., G.R. 204555, July 6, 2020

Petitioners Pedrito R. Parayday and Jaime Reboso alleged that they were employed sometime in October 1996
and March 1997, respectively, as fitters/welders by Oceanview/VRC Lighterage Co. Inc. and VRC/Oceanview
Shipbuilders Co. Inc. Their duties and responsibilities included, among others, assembling, welding, fitting and
installing materials or components using electrical welding equipment, and/or repairing and securing parts and
assemblies.

Sometime in 2003, Oceanview changed its corporate name to “Shogun Ships Inc.,” herein respondent, which
maintained the same line of business and retained in its employ petitioners. The management of Shogun Ships
Inc. verbally dismissed them from service effective May 1, 2008 due to lack of work as fitters and welders. Thus,
they filed a complaint for illegal dismissal, regularization and money claims.

Upon the other hand, respondent Shogun denied petitioners were its regular employees. It alleged that its
regular employees occasionally called in their friends and nearby neighbors such as petitioners who were
seeking temporary work as helpers until such time the needed repairs on its barges were carried out or
completed. They were not however engaged on a regular basis since their work on the barges was merely
temporary or occasional. It already had in its employ regular employees for its technical, mechanical, and
electrical needs. Concomitantly, helpers were free to seek employment elsewhere at any given time.

Whether petitioners are regular employees.

Ruling:
Article 295 of the Labor Code “provides for two types of regular employees, namely: (a) those who are engaged
to perform activities which are usually necessary or desirable in the usual business or trade of the employer
(first category); and (b) those who have rendered at least one year of service, whether continuous or broken,
with respect to the activity in which they are employed (second category).”

The regular employment status of a person is defined and prescribed by law and not by what the parties say it
should be. Thus, while respondent was of the belief that rendering occasional work for Shogun Ships prevented
the parties from creating an employment relationship, much more for petitioners from attaining regular
employment status, provision of law, however, dictates that they were regular employees of Shogun Ships.

First, the records of the case are bereft of evidence that petitioners were duly informed of the nature and status
of their engagement with Shogun Ships. Notably, in the absence of a clear agreement or contract, whether
written or otherwise, which would clearly show that petitioners were properly informed of their employment
status with Shogun Ships, petitioners enjoy the presumption of regular employment in their favor.

Second, petitioners were performing activities which are usually necessary or desirable in the business or trade
of Shogun Ships. This connection can be determined by considering the nature of the work performed by
petitioners and its relation to the scheme of the particular business or trade of Shogun Ships in its entirety.

As Shogun Ships is engaged in the business of domestic cargo shipping, it is essential, if at all necessary, that
Shogun Ships must continuously conduct vital repairs for the proper maintenance of its barges. The desirability
of petitioners’ functions is bolstered by the fact that Shogun Ships itself precisely retained in its employ regular
employees whose duties and responsibilities included, among others, performing necessary repair and
maintenance work on the barges.

Third, irrespective of whether petitioners’ duties or functions are usually necessary and desirable in the usual
trade or business of Shogun Ships, the fact alone that petitioners were allowed to work for it for a period of
more than one year, albeit intermittently since May 2006 until they were dismissed from employment on May 1,
2008, was indicative of the regularity and necessity of welding activities to its business. As such, their
employment is deemed to be regular with respect to such activities and while such activities exist.

ABOITIZ POWER RENEWABLES INC. / TIWI CONSOLIDATED UNION VS ABOITIZ POWER

RENEWABLES
GR NO 237036 JULY 8, 2020

On September 16, 2013, APRI called for a town hall meeting, wherein the employees were informed that the
company will implement a redundancy program that would result in the removal of around twenty percent (20%)
of its current employees. The affected employees were informed that their position in the company was found to
be redundant and that their employment will be. They were given and made to sign a Notice of Redundancy
and were also made to sign a Release, Waiver and Quitclaim and were given the option of signing a letter
addressed to Pierce, APRI's President and Chief Operating Officer. As a consequence of their termination
because of the redundancy program, the affected employees were given two (2) manager 's checks. The first
check represented the separation pay and the second manager 's check was in the amount of P400,000.00, as
the one-time special assistance to each of the affected employees. In addition to the affected employees who
assented to the redundancy program, some employees also tendered their voluntary resignation. These
employees likewise received two (2) manager 's checks consisting of the same components as those affected
by the redundancy program, and were also made to sign a Release, Waiver and Quitclaim.

Feeling aggrieved that they were forced to accept the redundancy program or forced to resign, the said
employees had the incident of their termination recorded through a police blotter. Subsequently, they also filed
complaints for illegal dismissal, illegal suspension (for employee Felicito Torrente), unfair labor practice for
union busting, and claims for 13th month pay, retirement benefits, damages, and attorney's fees.

The Labor Arbiter rendered a Decision dismissing the complaints for illegal dismissal for lack of merit and
ratiocinated that the employees were legally and validly dismissed due to the implementation of APRI's
redundancy program. The NLRC also found that APRI had properly carried out its redundancy program, thus, it
ruled that the dismissal of the employees on the basis of redundancy of their respective positions was valid. The
CA affirmed the ruling of the Labor Arbiter (LA) and the NLRC that the employees were validly dismissed on
account of APRI's implementation of its redundancy program.

ISSUE:

(1) Whether or not the CA erred in upholding the validity of APRI's Redundancy Program;
(2) Whether or not the CA erred in upholding the validity of the dismissal from employment of petitioners'
officers and members;
(3)  Whether or not CA erred in discounting unfair labor practice in the form of union busting against APRI and
the other respondents.

HELD:

The Court finds that the CA was correct in its determination that the NLRC did not commit grave abuse of
discretion.

Redundancy is an authorized cause for termination of employment under Article 298 (formerly Article 283) of
the Labor Code. It exists when "the services of an employee are in excess of what is reasonably demanded by
the actual requirements of the enterprise". The determination of whether the employees' services are no longer
necessary or sustainable, and therefore, properly terminable for redundancy, is an exercise of business
judgment. In making such decision, however, management must not violate the law nor declare redundancy
without sufficient basis. To ensure that the dismissal is not implemented arbitrarily, jurisprudence requires the
employer to prove, among others, its good faith in abolishing the redundant positions as well as the existence of
fair and reasonable criteria in the selection of employees who will be dismissed from employment due to
redundancy. Such fair and reasonable criteria may include but are not limited to: (a) less preferred status,  i.e.,
temporary employee; (b) efficiency; and (c) seniority.

In upholding the legality of the employees' dismissal, the NLRC ruled that the evidence submitted by APRI
showed compliance to all the four (4) requisites for a valid implementation of the redundancy program. These
included the following: (1) written notice served on both the employees and the DOLE one (1) month prior to the
intended date of dismissal; (2) payment of separation pay and the additional P400,000.00; (3) fair and
reasonable criteria in ascertaining what positions are to be declared redundant and accordingly abolished; and
(4) good faith in abolishing the redundant positions.

The good faith of APRI can be gleaned from its showing that the services of the affected employees were
indeed in excess of what is required by the company. Meanwhile, the Right-Sizing Program, the study in which
the redundancy program was based, showed the implementation guidelines and criteria used by APRI in
determining redundant positions, which this Court also found to be fair and reasonable.

As regards the claim of unfair labor practice in the form of union busting, this Court finds that the record of this
case is also bereft of any substantial evidence to support the charge against APRI.

Unfair labor practice refers to acts that violate the workers' right to organize. There should be no dispute that all
the prohibited acts constituting unfair labor practice in essence relate to the workers' right to self-organization.  
Thus, an employer may only be held liable for unfair labor practice if it can be shown that his acts affect in
whatever manner the right of his employees to self-organize. To prove the existence of unfair labor practice,
substantial evidence has to be presented. Petitioners' assertion that APRI 's redundancy program was meant to
interfere with or frustrate petitioners' union activities and negotiation of CBA was a bare conclusion and
unsupported by sufficient proof.
In sum, this Court finds that the rulings of the LA, the NLRC, and the CA were predicated on the evidence on
record and prevailing jurisprudence. We also found no compelling reason to depart from the general rule that
the unanimous findings of these three tribunals are binding upon this Court.

[ G.R. No. 245370, July 13, 2020 ]

EAGLE CLARC SHIPPING PHILIPPINES, INC., MAMA SHIPPING SARL AND CAPT. LEOPOLDO
ARCILLA, PETITIONERS, V. NATIONAL LABOR RELATIONS COMMISSION (FOURTH DIVISION) AND
JOHN P. LOYOLA, RESPONDENTS.

Loyola boarded the vessel MV Grande Luanda and he disembarked on February 2, 2016 or six months before
the expiration of his contract. On October 19, 2016, Loyola filed a complaint for illegal dismissal and monetary
claims against Eagle Clarc, Mama Shipping and Capt. Leopoldo Arcilla, as officer of Eagle Clarc (herein
petitioners), claiming that on January 29, 2016, he was called by Capt. Palerom Guiseppe and referred to Chief
Mate Rago Francesco. He was shown a document which he refused to sign because he did not know the
contents thereof. Because of his refusal to sign the document, Loyola was advised that he was terminated and
forced to disembark from the vessel. He alleged that prior to his disembarkation, he was neither informed of the
offense he allegedly committed nor afforded due process. He asked for the payment of his salary for the
unexpired portion of his contract and other benefits, plus damages.

The Labor Arbiter dismissed Loyola's complaint due to his failure to sign the verification in his position paper.
The NLRC issued a Decision granting Loyola's appeal. It found that Loyola substantially complied with the
procedural requirements when he duly authorized his counsel, through a Special Power of Attorney, to sign in
his behalf the verification and certification of non-forum shopping in his position paper. The CA held that Loyola
substantially complied with the verification and certification requirements while petitioners failed to support their
claims with substantial evidence and then affirmed the NLRC's decision with modification only as to the amount
of salary due the respondent.

ISSUE:
Whether Loyola is validly dismissed.
HELD:
We agree with both the NLRC and the CA that petitioners failed to discharge its burden of proving that Loyola
was dismissed due to a just and authorized cause and that the twin notice requirements were complied with.

The general rule is that factual findings of administrative or quasi-judicial bodies, which include labor tribunals,
are accorded much respect by this Court as they are specialized to rule on matters falling within their jurisdiction
especially when these are supported by substantial evidence. In labor cases, the burden of proving that the
termination of an employee was for a just or authorized cause lies with the employer. If the employer fails to
meet this burden, the conclusion is that the dismissal was unjustified and, therefore, illegal. Moreover, not only
must the dismissal be for a cause provided by law, it should also comply with the rudimentary requirements of
due process, that is, the opportunity to be heard and defend one's self. Thus, for dismissal to be valid, the
employer must show through substantial evidence – or such amount of relevant evidence that a reasonable
mind might accept as adequate to support a conclusion – that (1) the dismissal was for a just or authorized
cause; and (2) the dismissed employee was afforded due process.

In this case, petitioners assert that Loyola's termination was due to his incompetence and inefficiency.
Incompetence or inefficiency as a ground for dismissal contemplates the failure to attain work goals or work
quotas, either by failing to complete the same within the allotted reasonable period, or by producing
unsatisfactory results. Apart from their bare allegation that Loyola was dismissed due to incompetence and
inefficiency as he "failed to pass the criteria set by petitioners in relation to his work," petitioners failed to
present any evidence to substantiate such claim. As noted by the NLRC and the CA, no evidence was
presented to support the allegation that he was grossly and habitually neglectful of his duties that would merit
his dismissal.

As for the notice requirements, it is settled that for the manner of dismissal in termination proceedings to be
valid, the employer must comply with the employee's right to procedural due process by furnishing him with two
written notices before the termination of his employment. The first notice apprises the employee of the specific
acts or omissions for which his or her dismissal is sought, while the second informs the employee of the
employer's decision to dismiss him or her. In this case, we find no reason to reverse the findings of the CA and
the NLRC that respondent was not given ample time to answer the charge against him. The notations in the
notices that Loyola refused to sign or receive were also not sufficient proof that the petitioners attempted to
serve the notices to him.

[ G.R. No. 235315, July 13, 2020 ]

HENRY T. PARAGELE, ET. AL VS GMA NETWORK, INC.

Petitioners Henry T. Paragele and 29 others were employed as cameramen and assistant cameramen by
respondent GMA Network Inc. They filed a consolidated complaint against respondent GMA for regularization,
which was subsequently converted into one for illegal dismissal and money claims.
They assert that as camera operators assigned to several television programs of GMA, they performed
functions that were necessary and desirable to GMA as both a television and broadcasting company. They
further contend that their repeated and continuous employment with GMA after each television program they
covered shows the necessity and desirability of their functions. Hence, they have already attained the status of
regular employees.

Upon the other hand, GMA refutes the existence of an employer-employee relationship. It maintains that
petitioners were mere “pinch-hitters or relievers” who were engaged to augment its regular crew whenever there
is a need for substitute or additional workforce. It asserts further that the “service fees” given to them were not
compensation paid to an employee but rather remuneration for services rendered as pinch-hitters/freelancers. It
belies it exercised control over them. It claims that it only monitored their work performance to ensure that the
“end result” is compliant with company standards.

ISSUE: Whether there is an employer-employee relationship between the parties.

Whether petitioners are regular employees of GMA Network

Ruling:

To be considered employees of GMA, petitioners must prove the following: (1) that GMA engaged their
services; (2) that GMA compensated them; (3) that GMA had the power to dismiss them; and more importantly,
(4) that GMA exercised control over the means and methods of their work.

On the power of hiring, there is no question that petitioners were engaged by and rendered services directly to
GMA. Even GMA concedes that it engaged petitioners to perform functions, which had been found by the
National Labor Relations Commission and the Court of Appeals to be necessary and desirable to GMA’s usual
business as both a television and broadcasting company. On the payment of wages, that petitioners were paid
so-called “service fees” and not “wages” are merely a matter of nomenclature. Likewise, it is of no consequence
that petitioners were paid on a per-shoot basis, since this is only a mode of computing compensation and does
not, in any way, preclude GMA’s control over the distribution of their wages and the manner by which they
carried out their work.

It is settled that the mode of computing compensation is not the decisive factor in ascertaining the existence of
an employer-employee relationship. What matters is that the employee received compensation from the
employer for the services that he or she rendered. Here, there is no question that GMA directly compensated
petitioners for their services. On the power to dismiss, the Court of Appeals correctly sustained the National
Labor Relations Commission in noting that the power of dismissal “is implied and is concomitant with the power
to select and engage; in other words, it is also the power to disengage.” GMA maintains that petitioners were
merely “disengaged” from service. This, again, is a futile effort at splitting hairs. Disengagement in the context of
an employer-employee relationship amounts to dismissal.

Finally, on the most important element of control, it becomes necessary to determine whether GMA exercised
control over the means and methods of petitioners’ work. Moreover, given GMA’s specific representations on
the nature of its engagement with petitioners, a review of the difference between an independent contractor and
an employee is in order.

GMA rejects an explicit nomenclature recognizing it as having engaged petitioners as “talents” or independent
contractors. Yet, its denial of an employer-employee relationship, coupled with the claim that it merely exercised
control over the output required of petitioners, is an implicit assertion that it engaged petitioners as independent
contractors. It also does not escape this Court’s attention that the remuneration given to the petitioners was
denominated as “talent fee.” This is consistent with petitioners’ allegation that they were made to sign contracts
indicating that they were “talents” or independent contractors of GMA. 

GMA's claim that petitioners were required to render at least one (1) year of service before they may be
considered regular employees finds no basis in law. Petitioners were never casual employees precisely
because they performed functions that were necessary and desirable to the usual business of GMA. They did
not need to render a year's worth of service to be considered regular employees. In this case, GMA repeatedly
engaged petitioners as camera operators for its television programs. As camera operators, petitioners
performed activities which are: (1) within the regular and usual business of GMA; and (2) not identifiably distinct
or separate from the other undertakings of GMA. It would be absurd to consider the nature of their work of
operating cameras as distinct or separate from the business of GMA, a broadcasting company that produces,
records, and airs television programs. From this alone, the petitioners cannot be considered project employees
for there is no distinctive "project" to even speak of. Neither should GMA's assertion that petitioners were
merely engaged as pinch-hitters or substitutes, whose employment are for a specific duration or period, prevent
them from being regular employees. 

GMA is primarily engaged in the business of broadcasting, which encompasses the production of television
programs. Following the nature of its business, GMA is naturally and logically expected to engage the service of
camera operators such as petitioners, in case it ceases business by failing to shoot and record any television
program. Again, that petitioners' work as camera operators was necessary and desirable to the usual business
of GMA has long been settled by the consistent rulings of both the National Labor Relations Commission and
the Court of Appeals. Even GMA fails to refute these findings.

[ G.R. No. 201247, July 13, 2020 ]

ENGINEERING & CONSTRUCTION CORPORATION OF ASIA [NOW FIRST BALFOUR, INCORPORATED],
PETITIONER, VS. SEGUNDINO PALLE, FELIX VELOSA, ALBERTO PAMPANGA, RANDY GALABO, MARCO
GALAPIN AND GERARDO FELICITAS, RESPONDENTS.

Petitioner Engineering Construction Corp. of Asia (ECCA) is engaged in the construction business.
Respondents Segundino Palle and five others were hired by ECCA on various dates to work in its construction
business.

In a complaint for illegal dismissal, respondents claimed that ECCA hired them on different dates to perform
tasks which are necessary and desirable in its construction business. Although they may have signed
employment contracts for some of ECCA’s projects, they were asked to work in new projects or transferred to
other existing projects without the benefit of corresponding employment contracts. Furthermore, ECCA failed to
report the termination of their employment to the Department of Labor and Employment (Dole) every time that
the company completed the project. Hence, they are regular employees.

On the other hand, ECCA argued that respondents were project employees since they were hired for specific
project or undertaking, the termination of which was determined at the time of hiring. They were hired as project
employees to work at its various construction projects from the year 1990. It informed them of the scope and
duration of their work at the time they were engaged in each of those projects. They were separated from the
service upon the completion of the specific project.

Whether respondents are project employees of ECCA.

Ruling:

The Court finds that ECCA failed to present substantial evidence to show that it informed respondents of the
duration and scope of their work at the time of their hiring. Upon careful review of the company’s respective
contracts of employment with respondents, this Court holds that the employment contracts were lacking in
details to prove that respondents had been duly informed of the duration and scope of their work, and of their
status as project employees at the time of their hiring. The respective contracts of respondents may have been
dated at the time of their issuance, but nowhere did said contracts show as to when respondents supposedly
signed or received the same or were informed of the contents thereof.
This gives rise to the distinct possibility that respondents were not informed of their status as project employees,
as well as the scope and duration of the projects that were assigned to them at the time of their engagement.
Thus, ECCA failed to refute respondents’ claim that they worked in new projects or they were transferred to
other existing projects without the benefit of their corresponding employment contracts. Therefore, ECCA failed
to persuasively show that respondents herein were informed at the time of their engagement that their work was
only for the duration of the project.

Moreover, ECCA failed to present other evidence or other written contracts to show that it informed respondents
of the duration and scope of their work. Settled is the rule that “although the absence of a written contract does
not by itself grant regular status to the employees, it is evidence that they were informed of the duration and
scope of their work and their status as project employees at the start of their engagement. When no other
evidence is offered, the absence of employment contracts raises a serious question of whether the employees
were sufficiently apprised at the start of their employment of their status as project employees.” In addition, we
likewise note that the company did not submit a report with the Dole of the termination of respondents’
employment every time a project is completed, which is an indication that the workers were not project
employees but regular ones.

[ G.R. No. 247338, September 02, 2020 ]

ROGER V. CHIN, PETITIONER, VS. MAERSK-FILIPINAS CREWING, INC., MAERSK LINE A/S, AND RENEL C.
RAMOS, RESPONDENTS.

Petitioner was hired as Able Seaman for a six (6)-month contract on board the vessel MV Maersk Danube. After
undergoing the required Pre-Employment Medical Examination, petitioner was declared fit for duty. Sometime in
October 2016, while lifting the steel cover of a chain pipe located under the mooring in order to clear some
debris, petitioner allegedly felt excruciating pain on his back that resulted to blurring of vision or symptoms of
heart attack. He reported his condition to his superiors and requested for medical consultation but was refused.
Instead, he was recommended for medical repatriation and, subsequently, signed off from the vessel.

Upon arrival in Manila, petitioner was given proper post-employment medical examination and further treatment
by the company-designated physician. After completing various consultations and tests, petitioner was revealed
to be asymptomatic and had no more lower back pains. Thus, on even date, he was declared fit to work and
signed a Certificate of Fitness for Work.

On January 25, 2018, petitioner sought the second medical opinion of another physician, who assessed that
petitioner was "unfit for sea duty in whatever capacity." Petitioner requested disability compensation from
respondents, which was denied, prompting him to file a notice to arbitrate with the National Conciliation and
Mediation Board (NCMB) for permanent and total disability benefits, damages, and attorney's fees. After the
parties failed to settle the dispute before the NCMB, they agreed to undergo voluntary arbitration.

The VA dismissed petitioner's complaint for lack of merit. Upon appeal, the CA dismissed the petition outright
for having been filed one (1) day late, finding that petitioner only had until December 3, 2018  within which to file
the petition.

ISSUE: Whether or not the CA correctly dismissed the petition for having been filed out of time.

HELD:

In the 2010 ruling in Teng v. Pagahac, the Court clarified that the 10-day period set in Article 276 of the Labor
Code gave the aggrieved parties the opportunity to file their motion for reconsideration, which was more in
keeping with the principle of exhaustion of administrative remedies, holding thusly:

In the exercise of its power to promulgate implementing rules and regulations, an implementing agency,
such as the Department of Labor, is restricted from going beyond the terms of the law it seeks to
implement; it should neither modify nor improve the law. The agency formulating the rules and
guidelines cannot exceed the statutory authority granted to it by the legislature.

By allowing a 10-day period, the obvious intent of Congress in amending Article 263 to Article 262-A is
to provide an opportunity for the party adversely affected by the VA's decision to seek recourse via a
motion for reconsideration or a petition for review under Rule 43 of the Rules of Court filed with the CA.
Indeed, a motion for reconsideration is the more appropriate remedy in line with the doctrine of
exhaustion of administrative remedies. For this reason, an appeal from administrative agencies to the
CA via Rule 43 of the Rules of Court requires exhaustion of available remedies as a condition precedent
to a petition under that Rule.

The requirement that administrative remedies be exhausted is based on the doctrine that in providing for a
remedy before an administrative agency, every opportunity must be given to the agency to resolve the matter
and to exhaust all opportunities for a resolution under the given remedy before bringing an action in, or resorting
to, the courts of justice. Where Congress has not clearly required exhaustion, sound judicial discretion governs,
guided by congressional intent.

By disallowing reconsideration of the VA's decision, Section 7, Rule XIX of DO 40-03 and Section 7 of
the 2005 Procedural Guidelines went directly against the legislative intent behind Article 262-A of the
Labor Code. These rules deny the VA the chance to correct himself and compel the courts of justice to
prematurely intervene with the action of an administrative agency entrusted with the adjudication of
controversies coming under its special knowledge, training and specific field of expertise. In this era of
clogged court dockets, the need for specialized administrative agencies with the special knowledge, experience
and capability to hear and determine promptly disputes on technical matters or intricate questions of facts,
subject to judicial review, is indispensable.

Hence, the 10-day period stated in Article 276 should be understood as the period within which the party
adversely affected by the ruling of the Voluntary Arbitrators or Panel of Arbitrators may file a motion for
reconsideration. Only after the resolution of the motion for reconsideration may the aggrieved party appeal to
the CA by filing the petition for review under Rule 43 of the Rules of Court within 15 days from notice
pursuant to Section 4 of Rule 43. 

The Court further noted in Guagua that despite the clarification made in Teng v. Pagahac in 2010, the
Department of Labor and Employment (DOLE) and NCMB have yet to revise or amend Section 7,  Rule VII of
the Revised Procedural Guidelines in the Conduct of Voluntary Arbitration Proceedings and that such inaction
has caused confusion, particularly with respect to the filing of the motion for reconsideration as a condition
precedent to the filing of the petition for review in the CA. Thus, the Court expressly directed the DOLE and the
NCMB to cause the revision or amendment of the aforesaid section in order to allow the filing of motions for
reconsideration in line with Article 276 of the Labor Code. Unfortunately, no revision has yet been made in this
regard. Consequently, the DOLE and the NCMB are again reminded to cause the revision or amendment of
Section 7, Rule VII of the Revised Procedural Guidelines in the Conduct of Voluntary Arbitration Proceedings
insofar as it prohibits the filing of a motion for reconsideration, if they have not done so.