labor relations - jurisdiction and procedure (consolidated case digest)

Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)

1 Uy v Bueno

2 People’s Boradcasting v. Secretary AbadCase title – Peoples Broadcasting Association v. Sec. of Labor & Emp. (power to determine existence of E-ER)GR number – 179652Date – 6 March 2012Ponente - VELASCO, JR., J

Facts - Private respondent Jandeleon Juezan filed a complaint against petitioner with the DOLE - Cebu City, for illegal deduction, nonpayment of service incentive leave, 13th month pay, premium pay for holiday and rest day and illegal diminution of benefits, delayed payment of wages and noncoverage of SSS, PAG-IBIG and Philhealth. After the conduct of summary investigations, and after the parties submitted their position papers, the DOLE Regional Director found that private respondent was an employee of petitioner, and was entitled to his money claims.

This case stemmed from the first decision of the court where it was held that while the DOLE may make a determination of the existence of an employer-employee relationship, this function could not be co-extensive with the visitorial and enforcement power provided in Art. 128(b) of the Labor Code, as amended by RA 7730. The NLRC was held to be the primary agency in determining the existence of an employer-employee relationship. This was the interpretation of the Court of the clause “in cases where the relationship of employer-employee still exists” in Art. 128(b)

From this Decision, the Public Attorney’s Office (PAO) filed a Motion for Clarification of Decision (with Leave of Court). The PAO sought to clarify as to when the visitorial and enforcement power of the DOLE be not considered as co-extensive with the power to determine the existence of an employer-employee relationship.

Issue - may the DOLE make a determination of whether or not an employer-employee relationship exists, and if so, to what extent?

Ruling – If a complaint is brought before the DOLE to give effect to the labor standards provisions of the Labor Code or other labor legislation, and there is a finding by the DOLE that there is an existing employer-employee relationship, the DOLE exercises jurisdiction to the exclusion of the NLRC. If the DOLE finds that there is no employer-employee relationship, the jurisdiction is properly with the NLRC. If a complaint is filed with the DOLE, and it is accompanied by a claim for reinstatement, the jurisdiction is properly with the Labor Arbiter, under Art. 217(3) of the Labor Code, which provides that the Labor Arbiter has original and exclusive jurisdiction over those cases involving wages, rates of pay, hours of work, and other terms and conditions of employment, if accompanied by a claim for reinstatement. If a complaint is filed with the NLRC, and there is still an existing employer-employee relationship, the jurisdiction is properly with the DOLE. The findings of the DOLE, however, may still be questioned through a petition for certiorari under Rule 65 of the Rules of Court.

In the exercise of the DOLE’s visitorial and enforcement power, the Labor Secretary or the latter’s authorized representative shall have the power to determine the existence of an employer-employee relationship, to the exclusion of the NLRC.3 Bernarte v. PBA AbellaBernarte v. PBAG.R. No. 192084, September 14, 2011Carpio, J.

Facts: Jose Mel Bernarte and Renato Guevarra were made to sign contracts on a year-to-year basis as PBA referees. However, changes were made during the term of Commissioner Eala. Bernarte was only made to sign a one and a half month during the second conference of the Filipino Cup. Later on, Bernarte was advised that his contract will not be renewed due to his unsatisfactory performance on and off court. Bernarte cannot believe it for he was awarded as Referee of the Year in 2003. He felt that his dismissal was due to his refusal to fix a game upon order of one of the officials. On the other hand, Guevarra started as a trainee. Eventually, he was made to sign as a regular referee. However, he was no longer made to sign a contract due to his questioning on the

1The Arbiter's Compendium

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Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)assignment of referees in out-of-town games. Respondents contend that complainants were not illegally dismissed because they were not employees of the PBA. They have entered a retainer contract wherein PBA had the prerogative whether or not to renew the same. The Labor Arbiter declared petitioners an employee of respondent and that the former were illegally dismissed. NLRC affirmed the same. However, on appeal, CA found petitioner an independent contractor since respondent did not exercise any form of control over the means and method by which petitioners performed his work as a basketball referee.

Issue: Whether Bernarte is an employee of PBA.

Ruling: No. Bernarte, as a referee, is an independent contractor. To determine the existence of an employer-employee relationship, the four-fold test must be applied, to wit: (a) the selection and engagement of the employee; (b) the payment of wages; (c) the power of dismissal; and (d) the employer’s power to control the employee on the means and methods by which the work is accomplished. The so-called “control test” is the most important indicator of the presence or absence of an employer-employee relationship.

The SC agreed that referees exercise their own independent judgment, based on the rules of the game, as to when and how a call or decision is to be made. The referees decide whether an infraction was committed, and the PBA cannot overrule them once the decision is made on the playing court. The referees are the only, absolute, and final authority on the playing court. Respondents or any of the PBA officers cannot and do not determine which calls to make or not to make and cannot control the referee when he blows the whistle because such authority exclusively belongs to the referees. The very nature of petitioner’s job of officiating a professional basketball game undoubtedly calls for freedom of control by respondents.

Moreover, the following circumstances indicate that petitioner is an independent contractor:(1) the referees are required to report for work only when PBA games are scheduled, which is three times a week spread over an average of only 105 playing days a year, and they officiate games at an average of two hours per game; and (2) the only deductions from the fees received by the referees are withholding taxes.

In other words, unlike regular employees who ordinarily report for work eight hours per day for five days a week, petitioner is required to report for work only when PBA games are scheduled or three times a week at two hours per game. In addition, there are no deductions for contributions to the Social Security System, Philhealth or Pag-Ibig, which are the usual deductions from employees’ salaries. These undisputed circumstances buttress the fact that petitioner is an independent contractor, and not an employee of respondents.4 Citibank v. CA BorlasG.R. No. 108961. November 27, 1998CITIBANK, N. A., Petitioners, v. COURT OF APPEALS (Third Division), AND CITIBANK INTEGRATED GUARDS LABOR ALLIANCE (CIGLA) SEGATUPAS/FSM LOCAL CHAPTER No. 1394, Respondents.

PARDO, J.:

Facts: Citibank, situated at 8741 Paseo de Roxas, Makati, Metro Manila, entered into a contract with El Toro Security Agency, Inc. for security and protection service. The parties renewed the contract yearly until April 22, 1990. Citibank Integrated Guards Labor Alliance-SEGA-TUPAS/FSM (CIGLA), which includes el toro security guards assigned to Citibank, filed with the National Conciliation and Mediation Board (NCMB) for preventive mediation against Citibank due to unfair labor practice, dismissal of union officers/members and union busting. Citibank notified El Toro that they will not renew their contract with them. CIGLA converted its request for preventive mediation into a notice of strike for failure of the parties to reach a mutually acceptable settlement of the issues and alleged as supplemental issue the mass dismissal of all union officers and members. El Toro security guards formerly assigned to guard Citibank premises loitered around the bank's premises in large groups and threatened to stage a strike, which would hamper its operations and the normal conduct of its business and that the bank would suffer damages should a strike push through. Faced with the prospect of disruption of its business operations, Citibank filed with RTC, Makati, a complaint for injunction and damages against CIGLA. CIGLA filed a motion to dismiss that this court had no jurisdiction, this being labor dispute, which was dismissed. The court ruled in favor of Citibank. CIGLA filed a writ of certiorari which was granted by CA. Hence this petition.



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)Issue: Whether there is a labor dispute between Citibank and the security guards, members of CIGLA?

Ruling: None. Labor dispute includes any controversy or matter concerning terms or 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 employer and employee.

El Toro, being an independent contractor, recruited, hired and assigned the watchmen to their place of work. Thus, no employer-employee relationship existed between Citibank and the security guard members of the union in the security agency who were assigned to secure the bank's premises and property. Hence, there was no labor dispute and no right to strike against the bank.5 Montoya v. Escayo GubantesMontoya vs EscayoLabor Disputes not subject to Barangay conciliation

FACTS:Respondents were formerly employed as salesgirls in the petitioner's store. Their cases were initially filed separately but subsequently consolidated. The complaint was for the collection of sums of money against their employer for alleged unpaid overtime, holiday pay and illegal dismissal among others. The employer moved to dismiss the complaints claiming that the private respondents failed to refer the dispute to the Lupon Tagapayapa for possible settlement and to secure the certification required from the Lupon Chairman prior to the filing of the cases with the Labor Arbiter. The LA granted the motion to dismiss. NLRC reversed the LA order and remanded the case to the LA. The employer filed a petition for certiorari contending that amicable settlement proceedings before the LT as a jurisdictional requirement at the trial level apply to labor cases.

ISSUE: WON labor disputes are subject to Barangay Concilation. RULING: No, the provisions of PD 1508 requiring the submission of disputes before the barangay Lupong Tagapayapa prior to their filing with the court or other government offices are not applicable to labor cases. This decree intended applicability only to courts of justice, and not to labor relations commissions or labor arbitratos' offices. There is no mention at all of labor relations or controversies and labor arbiters or commissions in the clauses involved. Art.226 of the LC expressly grants original and exclusive jurisdiction over the conciliation and mediation of disputes, grievances, or problems in the original offices of the DOLE. Requiring conciliation of labor disputes before the barangay courts would defeat the very salutary purposes of the law. Instead of simplifying labor proceedings designed at expeditious settlement or referral to the proper court or office to decide it finally, the position taken by the petitioner would only duplicate the conciliation proceedings and unduly delay the disposition of the labor case.6 Smart JimenezSMART Communications v. AstorgaGR No. 181393, July 28, 2009 Employee benefit: a labor dipute or a civil dispute (Car Loan)

Facts:Regina M. Astorga (Astorga) was employed by respondent Smart Communications, Incorporated (SMART) on May 8, 1997 as District Sales Manager of the Corporate Sales Marketing Group/ Fixed Services Division (CSMG/FSD).As District Sales Manager, Astorga enjoyed additional benefits, namely, annual performance incentive equivalent to 30% of her annual gross salary, a group life and hospitalization insurance coverage, and a car plan in the amount of P455,000.00.SMART launched an organizational realignment to achieve more efficient operations. This was made known to the employees on February 27, 1998.Part of the reorganization was the outsourcing of the marketing and sales force. Thus, SMART entered into a joint venture agreement with NTT of Japan, and formed SMART-NTT Multimedia, Incorporated (SNMI). Since SNMI was formed to do the sales and marketing work, SMART abolished the CSMG/FSD, Astorga’s division. SNMI absorbed some CSMG personnel who would be recommeded by SMART. Astorga was not recommended but they offer her a supervisory position in the Customer Care Center. Astorga refused the offer and despite the abolition of her division, she continued reporting for work. SMART issued a memorandum advising Astorga of the termination of her employment on the ground of redundancy.The termination of her employment prompted Astorga to file a Complaint8 for illegal dismissal, non-payment of salaries and other benefits. SMART responded that there was valid termination.and argued that Astorga was dismissed by reason of redundancy, which is an authorized cause for termination of employment, and the dismissal was effected in accordance with the requirements of



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)the Labor Code. The redundancy of Astorga’s position was the result of the abolition of CSMG and the creation of a specialized and more technically equipped SNMI, which is a valid and legitimate exercise of management prerogative.

SMART sent a letter to Astorga demanding to pay the current market value of the Honda Civic Sedan which was given to her under the company’s car plan program, or to surrender the same to the company for proper disposition. Astorga, however, failed and refused to do either, thus prompting SMART to file a suit for replevin with the Regional Trial Court of Makati.

Astorga moved to dismiss the complaint on grounds of (i) lack of jurisdiction; (ii) failure to state a cause of action; (iii) litis pendentia; and (iv) forum-shopping. Astorga posited that the regular courts have no jurisdiction over the complaint because the subject thereof pertains to a benefit arising from an employment contract; hence, jurisdiction over the same is vested in the labor tribunal and not in regular courts.

Issue:Whether RTC has jurisdiction over the case

Ruling:Yes. Contrary to the CA’s rationication, te RTC rightfully assumed jurisdiction over the suit and acted well within its discretion in denying Astorga’s motion to dismiss. SMART’s demand for payment of the market value of the car or, in the alternative, the surrrender of the car, is not a labor but a civil dispute. A dispute which involves the relationship of debtor and creditor rather thar employer-employee relations falls within the jurisdiction of the regular court.7 Granteq Industrial JuradoGrandteq Industrial Steel Products V. MargalloGR 181393. July 28,09Ponente: Chico Nazario Fatcs. Grandteq is a domestic corporation engaged in the business of selling welding electrodes. Margallo was employed as a sales engineer. Margallo, awarded as salesman of the year, she was rewarded a car loan program in which she availed the same. Unfortunately, She was allegedly had committed a company violation in which she was asked to resign with a promise that her car loan payments will be reimbursed. No reimbursement had transpired. Margallo filed a complaint before the Labor Arbiter for the recovery of car loan payments. However, Grandteq contended that based in their car loan agreement, that in the event that Margallomre signed or was terminated her car loan would be forfeited.

Issue. Whether the contetion of Grantdteq is valid?

Held. No. The Court uphold a car loan agreement that threatens an employee with the forfeiture of all the car loan payments, should the employee wish to resign, said agreement can then be used by the employer to either hold said employee hostage to the job or punish him from resigning.8 Francisco Otsuka

9 Sonza PiedadSonza v. ABS-CBNGR.no. 138051 June 10, 2004Carpio,J.:

Facts: ABS-CBN and Sonza signed an agreement, Sonza being the representative of MJMDC as talent for radio and television. They were paid agreed talent fees. Later, Sonza resigned and ABS- CBN called for the rescission of the contract. In this contract, Sonza renounced the recovery of the benefits. But Sonza filed a complaint thereafter for non- payment of his salaries and other benefits. Respondent cintended that there was no benefits as there are no employer- employee relationship to speak with. The Labor Arbiter denied Sonza’s motion and and was seconded by the Court of Appeals.

Issue: Whether or not Sonza is entitled to the benefits he is asking.

Ruling: No. The entitlement of benefits is a question relating to employer- employee relationship. In



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)this case, Petitioner failed to prove its existence.

Sonza is an independent contracto. His unique skills, talent and celebrity status are not possessed by ordinary employees. He is not bound by the ABS-CBN’s control in the conduct of his work. He is paid talent fees and not wages for ordinary employees. Whatever benefits that the omplainant enjoyed roe from specific agreements of the parties and not by any reason of employer- employee relationship.10 Fairley RigorFULACHE VS. ABS-CBN BROADCASTING CORPGR NO. 183810 JANUARY 21, 2010BRION, J.

FACTS:Regularization Case

Petitioners Fulache and Castillo (drivers and cameramen), Atinen, Lagunzad, Jabonero (drivers), Ponce and Almendras (cameramen/editors), Bigno (PA/Teleprompter) and Cabas (VTR man/editor) filed complaints for regularization, unfair labor practice, and several money claims against ABS. They alleged that ABSCBN and their union entered into a CBA, and they learned that they had been excluded from its coverage as ABS-CBN considered them temporary employees. They claimed they had already rendered more than a year of service in the company and, therefore, should have been recognized as regular employees entitled to security of tenure and to the privileges and benefits enjoyed by regular employees.To properly establish their side, ABS-CBN argue otherwise.To cope with fluctuating business conditions, it contracts on a case-to-case basis the services of persons, also called “talents” (considered independent contractors) who possess the necessary qualifications to meet the requirements of its programs. These talents are paid a pre-arranged “talent fee”. They do not undergo probation and their services are terminated at the completion of the program. ABSCBN alleged that the complainants in this case are off-camera talents, hence not entitled to regularization.

LA ruling ONE – petitioners are regular employees.

Illegal Dismissal Case

During its appeal to NLRC, ABSCBN terminated the services of the drivers (Note – only five of the above: Fulache, Jabonero, Castillo, Lagunzad and Atinen [Atinen will execute a quitclaim later]).Hence, they filed a complaint for illegal dismissal case (Note: The same Labor Arbiter above [LA Rendoque] handled this case). ABSCBN’s Defense. Before all these cases started, it had already undertaken a comprehensive review of its existing organizational structure to address its operational requirements. Some services, such driving services, belongs to a job category that had already been contracted out.

LA Ruling TWO – contracting out of ABS CBN is valid. No illegal dismissal of petitioners due to redundancy, an authorized cause.

Merger of cases

NLRC’s Joint Decision

Regularization Case - EER exists between ABS CBN and petitioners. They cannot be considered contractual employees since they were not paid for the result of their work, but on a monthly basis and were required to do their work in accordance with the company’s schedule.Granted CBA benefits.

Illegal Dismissal Case – Drivers are illegally dismissed.

NLRC’s Reconsideration – EER exists, BUT there is redundancy so no illegal dismissal! They are also denied CBA benefits and that they are not deemed part of the collective bargaining unit!

CA’s Ruling

Petitioners failed to prove their claim to CBA benefits since they never raised the issue in the compulsory arbitration proceedings, and did not appeal the labor arbiter’s decision which was silent on their entitlement to CBA benefits. No illegal dismissal – redundancy! No showing of abuse



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)of prerogative on the part of ABS CBN!

Hence, this petition.

ISSUE:Whether or not the petitioners are regular employees?Whether or not the drivers are illegally dismissed?

RULING:

YES.Claim for CBA Benefits being regular employees.

As regular employees, the petitioners fall within the coverage of the bargaining unit and are therefore entitled to CBA benefits as a matter of law and contract.The ruling of the Labor Arbiter unequivocally settled the petitioners’ employment status: they are ABS-CBN’s regular employees entitled to the benefits and privileges of regular employees. These benefits and privileges arise from entitlements under the law and from their employment contract as regular ABS-CBN employees, part of which is the CBA if they fall within the coverage of this agreement. Thus, what only needs to be resolved as an issue for purposes of implementation of the decision is whether the petitioners fall within CBA coverage.The inclusion or exclusion of new job classifications into the bargaining unit shall be subject of discussion between the COMPANY and the UNION.

Under these terms, the petitioners are members of the appropriate bargaining unit because they are regular rank-and-file employees and do not belong to any of the excluded categories. Specifically, nothing in the records shows that they are supervisory or confidential employees; neither are they casual nor probationary employees.

CBA coverage is not only a question of fact, but of law and contract. The factual issue is whether the petitioners are regular rank-and-file employees of ABS-CBN. The tribunals below uniformly answered this question in the affirmative.

YES.Illegal Dismissal Case

The termination of employment of the four drivers occurred under highly questionable circumstances and with plain and unadulterated bad faith.The regularization case was in fact the root of the resulting bad faith as this case gave rise and led to the dismissal case. In the course of this appeal, ABS-CBN took matters into its own hands and terminated the petitioners’ services, clearly disregarding its own appeal then pending with the NLRC. To justify the termination of service, the company cited redundancy as its authorized cause but offered no justificatory supporting evidence. It merely claimed that it was contracting out the petitioners’ activities in the exercise of its management prerogative. This move (dismissed while there is a pending case) is a direct affront to the authority of the NLRC and an abuse of the appeal process)

It also forgot that by claiming redundancy, they admitted that petitioners are regular employees.ABS-CBN forgot that it had an existing CBA with a union, which agreement must be respected in any move affecting the security of tenure of affected employees; otherwise, it ran the risk of committing unfair labor practice – both a criminal and an administrative offense.

DAGDAG LANG BAKA TANUNGIN KC, AYUS LANG.. JJJ

The errors and omissions do not belong to ABS-CBN alone. The labor arbiter himself who handled both cases did not see the totality of the company’s actions for what they were. He appeared to have blindly allowed what he granted the petitioners with his left hand, to be taken away with his right hand, unmindful that the company already exhibited a badge of bad faith in seeking to terminate the services of the petitioners whose regular status had just been recognized. He should have recognized the bad faith from the timing alone of ABS-CBN’s conscious and purposeful moves to secure the ultimate aim of avoiding the regularization of its so-called "talents."




The NLRC, for its part, initially recognized the presence of bad faith. However, in an inexplicable turnaround, it reconsidered its joint decision and reinstated not only the labor arbiter’s decision of January 17, 2002 in the regularization case, but also his illegal dismissal decision of April 21, 2003.38 Thus, the NLRC joined the labor arbiter in his error that we cannot but characterize as grave abuse of discretion.

The Court cannot leave unchecked the labor tribunals’ patent grave abuse of discretion that resulted, without doubt, in a grave injustice to the petitioners who were claiming regular employment status and were unceremoniously deprived of their employment soon after their regular status was recognized. Unfortunately, the CA failed to detect the labor tribunals’ gross errors in the disposition of the dismissal issue. Thus, the CA itself joined the same errors the labor tribunals committed.11 Javier ValeraJAVIER V FLY ACE

FACTS:Javier files a complaint before the NLRC for underpayment of salaries and other labor standard benefits. He was an employee of fly ace since Sept 2007 performing various tasks such as cleaning and arranging the canned items and sometimes as pahinante. He reported for work from Monday to Saturday 7:00 am to 5:00 pm and during the employment he was not issued an ID and payslips by the company.

On May 2008 he was not allowed to enter the company premises upon the instruction on Mr. Ruben Ong for the reason that the latter was courting Javier’s daughter. Thereafter, he was terminated from work.Fly ace averred that Javier was only an extra helper on pakyaw basis and denying that he was an employee hence there was no illegal dismissal.ISSUE: Whether there was an ee-er relationship between Javier and Fly Ace.

RULING:LA:LA dismissed the complaint for lack of merit on the ground that Javier failed to present proof that he was a regular employee of Fly Ace.

NLRC:NLRC favored Javier. It ruled that LA skirted the argument of Javier and immediately concluded that he was not a regular employee simply because he failed to present proof. It was in their view that pakyaw basis arrangement did not preclude the existence of ee-er relationship. Javier was a regular employee because there was a reasonable connection between the particular activity performed by the employee (as pahinante) in relation to the usual business or trade of the employer (importation, sales and delivery of groceries)

CA:Annulled the decision of NLRC and reinstated the dismissal of Javier’s complaint as ordered by LA. The CA exercised its authority to make its own factual determination anent the issue of the existence of ee-er relationship between the parties.

Javier did not pass the “control test”

SC:The court affirms the assailed CA decision. Javier failed to adduce substantial evidence as basis for grant of relief. The court is of the considerable view that Javier lies the burden to pass the well settled tests to determine the existence of ee-er relationship: (1) the selection and engagement of the employee; (2) the payment of wages; (3) the power of dismissal; and (4) the power of control the employee’s conduct. Of these elements, the most important criterion is whether the employer controls or has reserved the right to control the employee not only as to the result of the work but also as to the means and methods by which the result is to be accomplished.



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)Javier was not required to report to work at regular hours; he was not made to register his time in and out everytime he was contracted to work; he was not subjected to any disciplinary sanction imposed to other employees for company violations; he was not issued a company ID; he was not accorded the same benefits given to other employees; he was not registered with SSS; and he was free to leave, accept , and engage in other means of livelihood as there is no exclusivity of his contracted services being co-terminus with the trip only. All these led to the conclusion that petitioner is not an employee of respondents.12 Banez AbadCase title – Banez v. Hon. Valdevilla (counterclaims of employers against employees)GR number – 128024Date – 9 May 2000Ponente - GONZAGA_REYES, J

Facts - Petitioner was the sales operations manager of private respondent in its branch in Iligan City. In 1993, private respondent "indefinitely suspended" petitioner and the latter filed a complaint for illegal dismissal with the NLRC-Iligan City. LA Palangan found petitioner to have been illegally dismissed. NLRC likewise dismissed the same for having filed out of time. Elevated by petition for certiorari before SC, the case was dismissed on technical grounds.

Private respondent filed a complaint for damages before the RTC of Misamis Oriental to which petitioner filed a motion to dismiss the above complaint. He interposed in the court below that the action for damages, having arisen from an employer-employee relationship, was squarely under the exclusive original jurisdiction of the NLRC under Article 217(a), paragraph 4 of the Labor Code and is barred by reason of the final judgment in the labor case. He accused private respondent of splitting causes of action

Issue – whether Art. 217 may apply to employer with regard to its claim of damages against its employees

Ruling - Article 217 should apply with equal force to the claim of an employer for actual damages against its dismissed employee, where the basis for the claim arises from or is necessarily connected with the fact of termination, and should be entered as a counterclaim in the illegal dismissal case

In the case at bar, private respondent's claim against petitioner for actual damages arose from a prior employer-employee relationship. In the first place, private respondent would not have taken issue with petitioner's "doing business of his own" had the latter not been concurrently its employee. Thus, the damages alleged in the complaint below are: first, those amounting to lost profits and earnings due to petitioner's abandonment or neglect of his duties as sales manager, having been otherwise preoccupied by his unauthorized installment sale scheme; and second, those equivalent to the value of private respondent's property and supplies which petitioner used in conducting his "business ".

Second, and more importantly, to allow respondent court to proceed with the instant action for damages would be to open anew the factual issue of whether petitioner's installment sale scheme resulted in business losses and the dissipation of private respondent's property. This issue has been duly raised and ruled upon in the illegal dismissal case.

Respondent court clearly having no jurisdiction over private respondent's complaint for damages.Thus, private respondent's remedy is not in the filing of this separate action for damages, but in properly perfecting an appeal from the Labor Arbiter's decision.13 SMCEU AbellaSAN MIGUEL CORPORATION EMPLOYEES UNION-PTGWO (SMCEU) v. Bersamina186 SCRA 496Melencio-Herrera, J.

Facts: San Miguel Corporation (SMC) entered into contracts for merchandising services with Lipercon and D’ Rite. It was agreed that workers employed by contractors were to be paid by the latter. SMCEU, a duly organized union of rank-and-file employees of SMC, executed a CBA which excludes temporary, probationary or contractual employees in the scope of the agreement. Later on, the union advised SMC that some Lipercon and D’ Rite workers had signed up for unionship and sought the regularization of employment. Failing to receive favourable response from SMC, the union filed a notice of strike for unfair labor practice. Conciliatory meeting were held to settle the dispute before the National Conciliation and Mediation Board (NCMB) of DOLE. Series of pickets



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)were staged by Lipercon and D'Rite workers in various SMC plants and offices which prompted the latter to file the latter to file a complaint for injunction before respondent court. SMCEU opposed the same on the ground of lack of jurisdiction of the court over the nature of the action. Respondent court denied the opposition and issued a writ of injunction on the ground that absence of employee-employer relationship negates a labor dispute. Issue: Whether respondent court has jurisdiction over the controversy, and whether it involves a labor dispute

Ruling: No. Respondent court has no jurisdiction over the controversy because it involves a labor dispute which falls within the jurisdiction of the Labor Arbiter. A "labor dispute" as defined in Article 212 (1) of the Labor Code 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 employer and employee." The existence of a labor dispute is not negated by the fact that the plaintiffs and defendants do not stand in the proximate relation of employer and employee. The case matter definitely dwells on the working relationship between said employees vis-a-vis SanMig. Terms, tenure and conditions of their employment and the arrangement of those terms are thus involved bringing the matter within the purview of a labor dispute.

Whether or not the Union demands are valid; whether or not SanMig's contracts with Lipercon and D'Rite constitute "labor-only" contracting and, therefore, a regular employer-employee relationship may, in fact, be said to exist; whether or not the Union can lawfully represent the workers of Lipercon and D'Rite in their demands against SanMig in the light of the existing CBA; whether or not the notice of strike was valid and the strike itself legal when it was allegedly instigated to compel the employer to hire strangers outside the working unit; — those are issues the resolution of which call for the application of labor laws in which jurisdiction belongs to the labor tribunals.14 Stolt BorlasG.R. No. 177498. January 18, 2012STOLT-NIELSEN TRANSPORTATION GROUP, INC. AND CHUNG GAI SHIP MANAGEMENT, Petitioners, -versus- SULPECIO MEDEQUILLO, JR., Respondent.PEREZ, J.:

Facts: On 6 November 1991(First Contract), Sulpecio Madequillo was hired by Stolt-Nielsen Marine Services, Inc on behalf of its principal Chung-Gai Ship Management of Panama as Third Assistant Engineer on board the vessel “Stolt Aspiration” for a period of nine (9) months. For nearly three (3) months of rendering service and while the vessel was at Batangas, he was ordered by the ship’s master to disembark the vessel and repatriated back to Manila for no reason nor explanation. Upon his return to Manila, he immediately proceeded to the petitioner’s office where he was transferred employment with another vessel named MV “Stolt Pride” under the same terms and conditions of the First Contract. The Second Contract was noted, approved and certified by the POEA. Petitioners failed and refused to deploy him with the vessel MV “Stolt Pride. He filed a complaint before the Adjudication Office of the Philippine Overseas Employment Administration (POEA) against the petitioners for illegal dismissal under a first contract and for failure to deploy under a second contract. The case was transferred to the Labor Arbiter of the DOLE upon the effectivity of the Migrant Workers and Overseas Filipinos Act of 1995. The Labor Arbiter found the first contract entered into by and between the complainant and the respondents to have been novated by the execution of the second contract. Hence, respondents cannot be held liable for the first contract but are clearly and definitely liable for the breach of the second contract due to constructive dismissal. However, he ruled that there was no substantial evidence to grant the prayer for moral and exemplary damages. 9The petitioners appealed the adverse decision before the National Labor Relations Commission assailing that they were denied due process as they were not properly notified of the hearings and respondent cannot be considered as dismissed from employment because he was not even deployed yet. NLRC affirmed the decision with modification as to the award of overtime. Petitioners filed a petition for certiorari and CA affirmed NLRC’s decision.

Issue: Whether seafarer can claim damages for non-deployment?

Ruling: Yes. The POEA Standard Employment Contract provides that employment shall commence upon the actual departure of the seafarer from the airport or seaport in the port of hire.

We rule that distinction must be made between the perfection of the employment contract and the commencement of the employer-employee relationship. The perfection of the contract, which in this



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)case coincided with the date of execution thereof, occurred when petitioner and respondent agreed on the object and the cause, as well as the rest of the terms and conditions therein. The commencement of the employer-employee relationship, as earlier discussed, would have taken place had petitioner been actually deployed from the point of hire. Thus, even before the start of any employer-employee relationship, contemporaneous with the perfection of the employment contract was the birth of certain rights and obligations, the breach of which may give rise to a cause of action against the erring party. Thus, if the reverse had happened, that is the seafarer failed or refused to be deployed as agreed upon, he would be liable for damages.15 Republic GubantesRepublic vs Asiapro CooperativeSSS authority to determine E-ER

FACTSIn the discharge of Asiapro’s objectives, the cooperative entered into several service contracts with Stanfilco, a division of DOLE Phil. Inc and a company based in Bukidnon. The owners-members do not receive compensation or wages from the respondent cooperative. Instead, they receive a share in the service surplus which Asiapro earns from different areas of trade it engages in. In order to enjoy the benefits under the SS Law of 1997, the owners-members of Asiapro assigned to Stanfilco requested the services of the latter to register them with SSS as self-employed and to remit their contributions as such. SSS send a letter to respondent cooperative informing the latter that based on the Service Contract it executed with Stanfilco, Asiapro is actually a manpower contractor supplying employees, and so, it is an employer of its owners-members working with Stanfilco. Thus, Asiapro should register itself with SSS as an employer and make the corresponding report and remittance of premium contributions. SSS filed a petition before SSC against Asiapro and Stanfilco praying that either of them be directed to register as an employer and to report Asiapro's owners-members as covered employees under the compulsory coverage of SSS. Respondent cooperative filed its answer with MtD alleging that no EE relationship exists, thus SSC has no jurisdiction over the respondent cooperative.

ISSUEWON SSS can determine the existence of EE relationship.

RULINGYes. SSC's jurisdiction is clearly stated in Sec.5 of RA 8282 as well as Sec.1 Rule III of the 1997 SS Revised Rules of Procedure. It is clear from the aforesaid provisions that any issue regarding compulsory coverage of the SSS is well within the exclusive domain of the petitioner SSC. It is imporant to note that the mandatory coverage under the SSS law is premised on the existence EE-relationship. Consequently, the respondent cooperative being the employer of its owners-members must register as employer and report its owners-members as covered members of the SSS and remit the necessary premium contributions in accordance with the SS Law of 1997.16 MySan JimenezM.Y. San Biscuits v. LaguesmaGR No. 95011, April 22, 2009 Med-Arbiter: Authority to determine EER

Facts:Private respondent Philippine Transport and General Workers Organization (Union for short) file a petition for certification election as a bargaining agent for a group of employees of petitioner M.Y. San Biscuits, Inc. before the med-arbiter of the Department of Labor and Employment (DOLE).After the parties submitted their position papers, the med-arbiter issued an order dismissing the petition for lack of merit as there is no employer-employee relationship between petitioner and the delivery drivers/helpers represented by respondent Union. Respondent Union and several others filed before the NLRC Branch of Region No. IV a complaint for underpayment of wages; non-payment of 13th month pay; service incentive pay and COLA; damages and attorney's fees.The labor arbiter rendered a decision dismissing the said complaint on the ground that there is no employer-employee relationship between the parties. Private respondent appealed to the NLRC.In the certification election case, private respondent appealed to the Secretary of DOLE. DOLE Secretary Franklin Drilon promulgated a resolution reversing the decision of the med-arbiter, thus finding that there exists an employer-employee relationship between petitioner and private respondent.

Petitioner filed a motion for reconsideration of this resolution and asking that the action be held in abeyance pending consideration of the other case where the LA rendered a decision declaring the absence of EER between the parties. Public respondent issued an order denying the relief sought in the manifestation of petitioner. Petitioner filed a motion for reconsideration therefrom but it was



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)denied, hence this petition.

Issue:Whether the med-arbiter or Secretary of Labor and Employment has the authority to determine the existence of EER between the parties in a petition for certification of election

Ruling:Yes. The BLR has the original and exclusive jurisdiction to inter alia, decide all disputes, grievances or problems arising from or affecting labor-management relations in all workplaces whether agricultural or non-agricultural. Necessarily, in the exercise of this jurisdiction over labor-management relations, the med-arbiter has the authority, original and exclusive, to determine the existence of an employer-employee relationship between the parties.17 Atlas JuradoATLAS FARMS, INC. v. NATIONAL LABOR RELATIONS COMMISSION, JAIME O. DELA PEÑA and MARCIAL I. ABIONG.R. No. 142244. November 18, 2002Ponente. QUISUMBING, J

Facts. Jaime O. dela Peña was employed as a veterinary aide by petitioner and terminated. He was re-hired by petitioner and given the additional job of feedmill operator. He was instructed to train selected workers to operate the feedmill. He was allegedly caught urinating and defecating on company premises not intended for the purpose. The farm manager of petitioner issued a formal notice directing him to explain why disciplinary action should not be taken against him for violating company rules and regulations. Peña never bothered to explain thus he was terminated with separation pay.

Marcial I. Abion was a carpenter/mason and a maintenance man whose employed by petitioner and allegedly caused the clogging of the fishpond drainage resulting in damages worth several hundred thousand pesos when he improperly disposed of the cut grass and other waste materials into the pond’s drainage system. Upon failure to explain what happened after notice, he was terminated with separation pay.

Peña and Abion filed separate complaints for illegal dismissal that were later consolidated. Both claimed that their termination from service was due to petitioner’s suspicion that they were the leaders in a plan to form a union to compete and replace the existing management-dominated union. Labor arbiter dismissed their complaints on the ground that the grievance machinery in the collective bargaining agreement (CBA) had not yet been exhausted. Private respondents availed of the grievance process, but later on refiled the case due to “lack of sympathy” on petitioner’s part to engage in conciliation proceedings. Petitioner filed a motion to dismiss, on the ground of lack of jurisdiction as it belonged to the grievance machinery and thereafter the voluntary arbitrator, as provided in the CBA. Labor arbiter dismissed the complaint for lack of merit. Thus, private respondents brought the case to the NLRC, which reversed the labor arbiter’s decision. Dissatisfied with the NLRC ruling, petitioner went to the Court of Appeals which affirmed the same. Hence this petition.

Issue. Whether the labor arbiter and the NLRC had jurisdiction to decide complaints for illegal dismissal?

Ruling. Anent the second issue, Article 217 of the Labor Code provides that labor arbiters have original and exclusive jurisdiction over termination disputes. A possible exception is provided in Article 261 of the Labor Code, which provides that-

“The Voluntary Arbitrator or panel of voluntary arbitrators shall have original and exclusive jurisdiction to hear and decide all unresolved grievances arising from the interpretation or implementation of the Collective Bargaining Agreement and those arising from the interpretation or enforcement of company personnel policies referred to in the immediately preceding article. Accordingly, violations of a Collective Bargaining Agreement, except those which are gross in character, shall no longer be treated as unfair labor practice and shall be resolved as grievances under the Collective Bargaining Agreement. For purposes of this article, gross violations of Collective Bargaining Agreement shall mean flagrant and or malicious refusal to comply with the economic provisions of such agreement.

The Commission, its Regional Offices and the Regional Directors of the Department of Labor and Employment shall not entertain disputes, grievances or matters under the exclusive and original



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)jurisdiction of the Voluntary Arbitrator or panel of Voluntary Arbitrators and shall immediately dispose and refer the same to the grievance Machinery or Arbitration provided in the Collective Bargaining Agreement.”

Where the dispute is just in the interpretation, implementation or enforcement stage, it may be referred to the grievance machinery set up in the CBA, or brought to voluntary arbitration. But, where there was already actual termination, with alleged violation of the employee’s rights, it is already cognizable by the labor arbiter.

In sum, we conclude that the labor arbiter and then the NLRC had jurisdiction over the cases involving private respondents’ dismissal, and no error was committed by the appellate court in upholding their assumption of jurisdiction.18 Perpetual Otsuka

19 Austria PiedadAustria v. NLRCGR.no. 124382 Aug. 16, 1999Kapunan, J.:

Facts: The Central Philippine Union Mission Corporation of the Seventh day Adventist (SDA) is a religious corporation to which Pastor Austria has worked as an evangelist. He advanced position under a propmotion until his services was terminated due to an alleged unremitted offerings collected by his wife and several other altercations with other fellow Pastors. Austria filed for Illegal Dismissal against the SDA and was given a favorable decision. When elevated to the NLRC, SDA received a favorable decision. Thus, Austria now the jurisdiction in this case.

Issue: Whether the NLRC has jurisdiction with this case.

Ruling: Yes. This case does not concern an ecclesiastical or purely religious affair as to the bar the State from taking cognizance from the same.

What is involved here is the relationship of the church as an employer and the minister as an employee. It is purely secular and has no relation with the practice of faith.

In this case, petitioner was not excommunicated but was terminated from employment. Coupled with this act, it is evident that the SDA furnished the NLRC with the copy of the petitioner’s letter of termination. It is an eloquent admission of the jurisdiction of the NLRC.20 Department RigorDEPARTMENT OF FOREIGN AFFAIRS VS. NLRCG.R.NO. 113191 SEPTEBER 18, 1996VITUG, J.

FACTS:Private respondent, Ronald E. Javier initiated NLRC-NCR Case No. 00-01-0690-93 for his alleged illegal dismissal by the Asian Development Bank (ADB) and the latter's violation of the "labor-only" contracting law. Two summonses were served, one sent directly to the ADB and the other through the Department of Foreign Affairs ("DFA"), both with a copy of the complaint. Forthwith, the ADB and the DFA notified respondent Labor Arbiter that the ADB, as well as its President and Officers, were covered by an immunity from legal process except for borrowings, guaranties or the sale of securities pursuant to Article 50(1) and Article 55 of the Agreement Establishing the Asian Development Bank (the "Charter") in relation to Section 5 and Section 44 of the Agreement Between The Bank And The Government Of The Philippines Regarding The Bank's Headquarters (the "Headquarters Agreement"). The Labor Arbiter took cognizance of the complaint on the impression that the ADB had waived its diplomatic immunity from suit. It decided a decision in favor of the private respondent, and awarded the necessary benefits of his employment. The DFA and including the office of the solicitor general opposed the decision in virtue to the argument that the jurisdiction of this case must be held in the office of the ombudsman and not to the labor arbiter. Thus, ADB was really immune from any action against it, due to the cloak of diplomatic immunity he possess.

ISSUE: Whether or not the Office of the Ombudsman has the better jurisdiction over ADB, than the Labor Arbiter?



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)RULING: YES

Private respondent argues that, by entering into service contracts with different private companies, ADB has descended to the level of an ordinary party to a commercial transaction giving rise to a waiver of its immunity from suit. In the case of Holy See vs. Hon. Rosario, Jr., the Court has held:“There are two conflicting concepts of sovereign immunity, each widely held and firmly established. According to the classical or absolute theory, a sovereign cannot, without its consent, be made a respondent in the Courts of another sovereign. According to the newer or restrictive theory, the immunity of the sovereign is recognized only with regard to public acts or acts jure imperii of a state, but not with regard to private act or acts jure gestionis.

“x x x x x x x x x

“Certainly, the mere entering into a contract by a foreign state with a private party cannot be the ultimate test. Such an act can only be the start of the inquiry. The logical question is whether the foreign state is engaged in the activity in the regular course of business. If the foreign state is not engaged regularly in a business or trade, the particular act or transaction must then be tested by its nature. If the act is in pursuit of a sovereign activity, or an incident thereof, then it is an act jure imperii, especially when it is not undertaken for gain or profit.”The service contracts referred to by private respondent have not been intended by the ADB for profit or gain but are official acts over which a waiver of immunity would not attach.21 Negros ValeraNEGROS METAL CORP V LAMAYO

FACTS:Lamayo was hired by Negros as machinist. He was suspended by the company when he was asked why he was using the grinder and replied that he would finish his work faster. He was again suspended for 10 days for allegedly failing to sign the memorandum suspending him earlier. After the suspension he was informed that his services had been terminated and that he should draft his resignation letter drawing the respondent to file a complaint for illegal dismissal.Petitioner contended that complaint should be dismissed because the LA had no jurisdiction over it since under their CBA such matters must first be resolved before the company’s grievance machinery.

ISSUE:Whether LA has jurisdiction over the case.

RULING: LA: Complainant was illegally dismissed.

NLRC: Set aside the ruling of LA for disposition based on the company’s grievance procedure.CA: Set aside the NLRC resolution and reinstated the LA decision.

SC: As a general rule, termination disputes should be brought before a labor arbiter except when the parties under Art 262 mistakably express that they agree to submit the same to voluntary arbitration.

Under Art 217 it is clear that the labor arbiter has original and exclusive jurisdiction over termination disputes. On the other hand, under Art 261, a voluntary arbitrator has original and exclusive jurisdiction over grievances arising from the interpretation or enforcement of company policies. Hence the issue should be brought before the LA.22 Navarro AbadCase title – Navarro III v. Damasco (termination is not grievable issue)GR number – 101875Date – 14 July 1995Ponente - QUIASON, J

Facts - Petitioner was employed as typist of private respondent at its plant in Quezon, Bukidnon. Petitioner was then dismissed from the service for having violated paragraph 3.B (Conduct and Behavior) of the Code of Employee Discipline, after he harassed a co-employee within the company premises. The President of the Mindanao Sugar Workers Union, for and in behalf of petitioner, and Personnel Officer of private respondent, agreed to submit the case of petitioner to voluntary arbitration to which the latter rendered decision dismissing petitioner from his employment and



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)holding that private respondent did not violate the provisions of the grievance procedure under the CBA. Hence, the instant petition was filed.

Issue – whether the instant case is grievance that must be submitted to the grievance machineryRuling - The instant case is not a grievance that must be submitted to the grievance machinery. What are subject of the grievance procedure for adjustment and resolution are grievances arising from the interpretation or implementation of the collective bargaining agreement (Labor Code of the Philippines, as amended by R.A. No. 6715, Art. 260). The acts of petitioner involved a violation of the Code of Employee Discipline, particularly the provision penalizing the immoral conduct of employees. Consequently, there was no justification for petitioner to invoke the grievance machinery provisions of the Collective Bargaining Agreement.

The incident happen within the company premises, i.e. the ladies' dormitory which was located inside the plant site, but both of them are employees of private respondent. Management would then be at the mercy of its employees if it cannot enforce discipline within company premises solely because the quarrel is purely personal matter. The harassment of an employee by a co-employee within the company premises even after office hours is a work-related matter considering that the peace of the company is thereby affected. The Code of Employee Discipline is very clear that immoral conduct "within the company premises regardless of whether or not [it is] committed during working time" is punishable.23 Negros AbellaNegros Metal Corp. v. LamayoG.R. No. 186557, August 25, 2010Carpio-Morales, J.

Facts: Armelo Lamayo worked for Negros Metal Corporation as a machinist. While Lamayo was working at the company’s foundry grinding some tools, the company manager called his attention to the fact that he was using the grinder. Lamayo replied that since the machine was bigger, he would finish the work faster. Since Lamayo’s explanation was found unsatisfactory, he was charged of loitering and warned via memorandum. Taking the warning as a three-day suspension under the company rules, Lamayo reported for work after three days, only to be meted with another ten-day suspension, for allegedly failing to sign the memorandum suspending him earlier. After serving the second suspension, he was informed by the company that his services had been terminated and that he should draft his resignation letter. Lamayo filed a complaint for illegal dismissal with the Labor Arbiter. Negros Metal Corporation averred that the complaint should be dismissed because the Labor Arbiter had no jurisdiction over the same since under the Collective Bargaining Agreement, such matters must first be brought before the company’s grievance machinery. The LA held that Lamayo was illegally dismissed. Upon appeal, the NLRC set aside the ruling of the LA and remanded the case to the LA for disposition based on the company’s grievance procedure. Lamayo appealed to the CA, which set aside the NLRC decision and reinstated the LA decision.

Issue: Whether Lamayo should have gone through the company’s grievance machinery first before filing acomplaint for illegal dismissal with the Labor Arbiter.

Ruling: NO. Under Article 217, it is clear that a Labor Arbiter has original and exclusive jurisdiction over termination disputes. On the other hand, under Article 261, a voluntary arbitrator has original and exclusive jurisdiction over grievances arising from the interpretation or enforcement of company policies.

As a general rule then, termination disputes should be brought before a Labor Arbiter, except when the parties, under Article 262,unmistakably express that they agree to submit the same to voluntary arbitration. In the present case, the CBA provision on grievance machinery being invoked by Negros Metal does not expressly state that termination disputes are included in the ambit of what may be brought before the company’s grievance machinery. Therefore, the LA had original and exclusive jurisdiction over Lamayo’s complaint for illegal dismissal.24 University BorlasG.R. No. 181146. January 26, 2011THE UNIVERSITY OF THE IMMACULATE CONCEPTION and MO. MARIA ASSUMPTA DAVID, RVM, Petitioners, - versus - NATIONAL LABOR RELATIONS COMMISSION and TEODORA AXALAN, Respondents.CARPIO, J.:

Facts: Private respondent Teodora C. Axalan is a regular faculty member in University of the Immaculate Conception, situated in Davao City. She then received a memorandum6 from Dean



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)Maria Rosa Celestial asking her to explain in writing why she should not be dismissed for having been absent without official leave when she attended a seminar in Quezon City on website development. She claimed that she held online classes while attending the seminar and would not be marked absent even if they were not physically present in the classroom as long as they conducted online classes. Dean Celestial relayed to Axalan that no administrative charge would be filed if Axalan would admit having been absent without official leave and write a letter of apology seeking forgiveness however Axalan opted not to. The Dean notified Axalan that the university president had created an ad hoc grievance committee to investigate the AWOL charge. The Dean Celestial informed Axalan of her second AWOL charge for her participation in the paralegal seminar in Baguio City was the subject of a second AWOL charge and asked to explain in writing why no disciplinary action should be taken against her. She explained that she sought the approval of her application for official leave before she left. The university president approved the committee’s recommendation who found Axalan to have incurred AWOL with one year suspension without pay. Axalan filed a complaint against the university for illegal suspension, constructive dismissal, reinstatement with backwages, and unfair labor practice with prayer for damages and attorney’s fees. The university moved to dismiss the complaint on the ground that the Labor Arbiter had no jurisdiction over the subject matter of the complaint and maintained that jurisdiction lay in the voluntary arbitrator. Motion was denied. Meanwhile, upon the expiration of the one-year suspension, Axalan promptly resumed teaching at the university. The LA ruled in favor of Axalan that said suspension amounted to constructive dismissal and entitling her to reinstatement and backwages. NLRC and CA affirmed said decision.

Issue: Whether the voluntary arbitrator had jurisdiction over the labor dispute of constructive dismissal?

Ruling: Article 217 of the Labor Code states that unfair labor practices and termination disputes fall within the original and exclusive jurisdiction of the Labor Arbiter except as otherwise provided under this code. Article 262 states that The Voluntary Arbitrator or panel of Voluntary Arbitrators, upon agreement of the parties, shall also hear and decide all other labor disputes including unfair labor practices and bargaining deadlocks. In San Miguel Corp. v. NLRC, the Court ruled that for the exception to apply, there must be agreement between the parties clearly conferring jurisdiction to the voluntary arbitrator. Such agreement may be stipulated in a collective bargaining agreement. However, in the absence of a collective bargaining agreement, it is enough that there is evidence on record showing the parties have agreed to resort to voluntary arbitration. As can be gleaned from the transcript of stenographic notes of the administrative hearing, the parties in this case clearly agreed to resort to voluntary arbitration.25 Ramirez GubantesM. Ramirez Industries vs Sec. of LaborLA vs Regional Director under Art. 129 LC Requisites

Carolyn Alfonso and other employees filed a complaint with the Regional office of the Department of Labor in Cebu City, alleging non-paymeent of minimum wage, living allowances and non-compliance with other labor standard laws against M.Ramirez Industries. An inspection was conducted in the company premises and after verification of allegations, the case was recognized. Petitioner filed an ex parte motion to dismiss the case alleging voluntary desistance through a letter by the private respondents. The Regional Director denied petitioner's motion because some of the complainants were deceived to sign the letter. The petitioner filed a motion to remand the case to the NLRC, contending that the matter was outside the jurisdiction of the Regional Director. Petitioner moved for a reconsideration of the RD's order, which was treated as an appeal to the Secretary of Labor and Employment. The SoLE affirmed RD's decision. The petitioner filed this petition on the ground that RD has no jurisdiction to take cognizance of the case and that the case falls within the original and exclusive jurisdiction of the LA. ISSUEWON the RD has jurisdiction over the case. RULINGYes. E.O. No. 111 conferred jurisdiction over money claims of laborers on Regional Directors, concurrently with Labor Arbiters. According to Art. 129, upon complaint of any interested party, the Regional Diretor of the Department of Labor and Employment or any of the duly authorized hearing officers of the Departmentis empowered, provided, that such complaint does not include a claim for reinstatement and the aggregate money claims of each employee or househelper does not exceed P5,000. In this case, although no longer employees of petitioner, private respondents do not seek reinstatement and the aggregate moeny claim of each of them does not exceed P5,000.



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)The RD may not be divested of jurisdiction over these claims, unless the ff elements are present

1. The employer contests the findings of the labor regulation officer and raises issues thereon2. That in order to resolve such issues, there is need to examine evidentiary matters3. Such matters are not verifiable in the normal cause of inspection. These conditions do not exist in this case and, therefore, there can be no question that the Regional Director had jurisdiction to decide the claims of private respondents.26 Consolidated JimenezConsolidated Broadcasting System, Inc. Vs. Oberio GR No. 168424, June 8, 2007 (Forum Shopping)

Facts: Respondents alleged that they were employed as drama talents by DYWB-Bombo Radyo, a radio station owned and operated by petitioner Consolidated Broadcasting System, Inc. They reported for work daily for six days in a week and were required to record their drama production in advance. Their drama programs were aired not only in Bacolod City but also in the sister stations of DYWB in the Visayas andMindanao areas.

Sometime in August 1998, petitioner reduced the number of its drama productions from 14 to 11, but was opposed by respondents. After the negotiations failed, the latter sought the intervention of the Department of Labor and Employment (DOLE), which on November 12, 1998, conducted through its Regional Office, an inspection of DWYB station. The results thereof revealed that petitioner is guilty of violation of labor standard laws, such as underpayment of wages, 13th month pay, non-payment of service incentive leave pay, and non-coverage of respondents under the Social Security System.

Petitioner contended that respondents are not its employees and refused to submit the payroll and daily time records despite the subpoena duces tecum issued by the DOLE Regional Director. Petitioner further argued that the case should be referred to the NLRC because the Regional Director has no jurisdiction over the determination of the existence of employer-employee relationship which involves evidentiary matters that are not verifiable in the normal course of inspection.

Respondents Oberio and Delta were suspended for minor lapses and the payment of their salaries were purportedly delayed. Pending the outcome of the inspection case with the Regional Director, respondents were barred by petitioner from reporting for work; thus, the former claimed constructive dismissal.Respondents filed a case for illegal dismissal, underpayment/non-payment of wages and benefits plus damages against petitioner. The Labor Arbiter dismissed the case without prejudice while waiting for the decision of the Secretary of Labor on the same issue of the existence of an employer-employee relationship between petitioner and respondents. NLRC rendered a decision holding that respondents were regular employees of petitioner who were illegally dismissed by the latter. It further held that respondents complied with the requirements of the rule on forum shopping. Issue:

Whether the respondents violates the rule on forum shopping

Ruling:No. Under Article 217 of the Labor Code, termination cases fall under the jurisdiction of Labor Arbiters. Whereas, Article 128 of the same Code vests the Secretary of Labor or his duly authorized representatives with the power to inspect the employer’s records to determine and compel compliance with labor standard laws. The exercise of the said power by the Secretary or his duly authorized representatives is exclusive to cases where employer-employee relationship still exists. Thus, in cases where the complaint for violation of labor standard laws preceded the termination of the employee and the filing of the illegal dismissal case, it would not be in consonance with justice to charge the complainants with engaging in forum shopping when the remedy available to them at the time their causes of action arose was to file separate cases before different fora. Besides, in the instant case, respondent Danny Oberio disclosed in the verification the pendency of the case regarding wage differential. In addition, said case was discussed in detail



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)in the position paper, evincing the absence of any intention on the part of respondents to mislead the Labor Arbiter.27 Rizal JuradoRizal Security and Protective Services V. Hon. MaraanGR 124915. Feb. 18,08Ponente Chico-Nazarion

Facts: Petitioner is a corporation engaged in the business of security agency. The public respondent is the DOLE Regional Director for Cordillera Region and private respndent was the former employee of the said security qgnecy. During the emplyoment of the private respondent, he sought the assistance of the DOLE for the petitioner's alleged violation such as illegal deduction of wages and underpayment of night shift differential. However, Petitioner cqlimed that the DOLE had lost its jurisdiction because there was no longer any employer- employee relationship between the parties due to the previous resignation of the private respondent

Issue. Whether the claim of the petitioner is valid?

Held. No. It is settled rule that the jurisdiction of a court over the subject matter of an action is determined by the allegations in the complaint at the time of the filing, irrespective of whether the plaintiff is entitled to recover any claims asserted therein28 Ex- Bataan Otsuka

29 People’s PiedadPeople’s Broadcasting v. Secretary of LaborGR.no. 179652 Mar. 6, 2012

Tinga, J.:

Facts: Jandeleon Juezan filed a complaint against the petitioner for illegal deduction and non- payment of service and other benefits before the DOLE. At a plant inspection made by a Labor Inspector, petitioner denied the existence of an employer- employee relation and instead, characterized the complainant as a talent. The Regional Director ruled that the respondent is the employer of Juenzan. Petitioner raised contention in the Court of Appeals contending among others that the DOLE has no jurisdiction over respondent’ s claim and that it must be lodged in the NLRC.

Issue: Whether or not the DOLE has jurisdiction over respondent’s claim in the existence of an employer employee relationship.

Ruling: No. In this case, the DOLE has no jurisdiction.

In Article 128 (b) of the Labor Code as amended by RA 7730, the clause “ in cases where the employer-employee still exists” signifies that the employer- employee relationship must have existed even before the emergence of the controversy. It can be assumed that the DOLE in the exercise of visitorial and enforcement powers somehow has to make a determination of EER but only for enforcing Labor Standards provisions. But the relationship questionis still lodged in the NLRC.

Thus, the Dole may exercise its power under Art. 128 when: 1) Employer- Employee Relationship exists, and 2) There are violations of any Labor Laws.30 Meteoro RigorMETEORO VS. CREATIVE CREATURESG.R. NO. 171275 JULY 13, 2009NACHURA, J.:

FACTS:

Creative Creatures hired Victor Meteoro and the rest of the petitioners on various dates as artists, carpenters, and welders, tasked to design, create, assemble, set-up, and dismantle props, and provide sound effects to Creatives various TV programs and movies. In 1999, Meteoro and the others filed a complaint against Creative for non-payment of labor standards incentives with the DOLE-NCR. An inspection was conducted. Creative claimed that the petitioners were only contractual workers, and as such, no employer-employee relationship existed. Thus, the DOLE could not have exercised jurisdiction over the case, for it had none. It added that the petitioners



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)were free-lance individuals, performing special services with skills and expertise inherently exclusive to them like actors, actresses, directors, producers, and script writers, such that they were treated as special types of workers. Petitioners, on the other hand, aver that they were employees because the elements of an employer-employee relationship existed. Subsequently, petitioners filed a complaint for illegal dismissal against Creative, with prayer for payment of overtime pay, premium pay for holiday and rest day, holiday pay, service incentive leave pay, 13Th month pay, and attorney’s fees before the NLRC. A few months after, DOLE Regional Director Maximo Baluyot Lim issued an order directing Creative to pay petitioners. On appeal, DOLE Secretary Patricia Sto. Tomas upheld the DOLE Regional Director’s findings. She stated that the Secretary of Labor or his duly authorized representative is allowed to use his visitorial and enforcement powers to give effect to labor legislation regardless of the amount involved. On appeal, the CA dismissed the case against Creative for lack of jurisdiction. Hence, this petition for review on certiorari.

ISSUE: Whether or not the DOLE-NCR properly exercised its jurisdiction over the case.

RULING: NO.

The DOLE Secretary and her authorized representatives, such as the DOLE-NCR Director, have jurisdiction to enforce compliance with labor standards laws under the broad visitorial and enforcement powers conferred by Article 128 of the Labor Code, and expanded by RA No. 7730. But this notwithstanding, the power of the Regional Director to hear and decide money claims is not absolute. The last sentence of Article 128 (b) of the Labor Code, otherwise known as the- exception clause, it provides an instance when the Regional Director or his representatives may be divested of jurisdiction over a labor standards case. Under prevailing jurisprudence, the so-called exception clause has the following elements, all of which must concur:

(a) That the employer contests the findings of the labor regulations officer and raises issues thereon;(b) That in order to resolve such issues, there is a need to examine evidentiary matters; and(c) That such matters are not verifiable in the normal course of inspection.

In the instant case, Creative registered its objection to the findings of the labor inspector at the earliest opportunity. It is clear that Creative contested and continues to contest the findings and conclusions of the labor inspector. Also, the question of whether or not petitioners were independent contractors/project employees/free-lance workers is a question of fact that necessitates the examination of evidentiary matters not verifiable in the course of inspection. Verily, the Regional Director and the Secretary of Labor are divested of jurisdiction to decide the case, and the NLRC is the agency clothed with authority to do so. Petition denied for lack of merit. CA decision affirmed.

“To contest” means to raise questions as to the amounts complained of or the absence of violation of labor standards laws; or, issues as to the complainants right to labor standards benefits. Raising lack of jurisdiction alone is not the “contest’ contemplated by the exception clause. It is necessary that the employer contest the findings of the labor regulations officer during the hearing or after receipt of the notice of inspection results. More importantly, the key requirement for the Regional Director and the DOLE Secretary to be divested of jurisdiction is that the evidentiary matters be not verifiable in the course of inspection. Where the evidence presented was verifiable in the normal course of inspection, even if presented belatedly by the employer, the Regional Director, and later the DOLE Secretary, may still examine it; and these officers are not divested of jurisdiction to decide the case.31 Norkis ValeraNORKIS TRADING V BUENAVISTA

FACTS:Respondents Buenavista, Fabroa, Cape, Tulod, Dondoyano and Villarista were skilled workers assigned in the operation of industrial and welding machines owned by Norkis Trading for its business. They filed a complaint for illegal suspension, illegal dismissal, unfair labor practice, and other monetary claims before the NLRC contending that they were regarded by Norkis as members of PASAKA (Panaghuisa sa Kauswagar Corp), which was deemed as independent contractor that merely deployed the respondents for Norkis. The respondents belived that they were regular employees of Norkis.



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)Respondents filed before the DOLE a complaint against Norkis and PASAKA for labor only contacting and non-payment of minimum wage and overtime pay. The filing of the complaint led to the suspension of respondents. Later, the were informed by PASAKA that they were transferred to Norkis Trading’s sister company, Porta Coeli Industrial Corp as washers of multicab vehicles. ISSUE:

RULING:LA: Dismissed the complaint for lack of merit and directed PASAKA to accept complainants for work.DOLE: PASAKA was engaged in labor-only contracting for (1) failing to prove that it had substantial capital; (2) the machineries, equipment and supplies used by the respondents in the performance of their duties were all owned by NORKIS and PASAKA; (3) respondents’ membership with PASAKA as cooperative was inconsequential to the employment with NORKIS; (4) Norkis and PASAKA failed to prove that their sub-contracting arrangements were covered by any of the conditions set forth in Sec 6 of D.O 10; (5) Norkis and PASAKA failed to dispute the respondent’s claim that their work was supervised by leadmen and production supervisors of Norkis; and (6) Norkis and PASAKA failed to dispurte the respondent’s allegation that their salaries were paid by employees of Norkis Trading.NLRC: affirmed the decision of LA with modification.

The respondents were not illegally suspended from work, as it was their membership in the cooperative that was suspended after they were found to have violated the cooperative’s rules and regulations.

NLRC declared that La had no jurisdiction over the dispute because the respondents were not employees but members of PASAKA. The dispute was not a labor dispute but an intra-corporate dispute.

CA: reversed and set aside the decision of NLRC. Norkis trading’s refusal to accept them back to their former positions, offering them instead to accept a new assignment as washers of vehicles in their sister company was a demotion that amounted to a constructive dismissal.

SC: Petition by Norkis under rule 65 was denied.

Factual findings of labor officials may be examined by the courts when there is a showing that they were arrived at arbitrary or in disregard of evidence on record.

This case falls on the exception to the general rule that findings of fact of labor officials are to be accorded respect and finality on appeal.32 Del Monte AbadCase title –Del Monte Phils, Inc. v. Saldivar (jurisdiction over money claims)GR number – 158620Date – 11 October 2006Ponente - TINGA, J

Facts - Associated Labor Union (ALU) is the exclusive bargaining agent of plantation workers of petitioner Del Monte Philippines, Inc. (Del Monte) in Bukidnon. Respondent Timbal, as a rank-and-file employee of Del Monte, is also a member of ALU. Del Monte and ALU entered into a Collective Bargaining Agreement (CBA).

Timbal, along with 4 other employees were charged by ALU for disloyalty to the union, particularly for encouraging defections to a rival union, the National Federation of Labor (NFL). The matter was referred to a body within the ALU organization, ominously named “Disloyalty Board.” ALU Disloyalty Board concluded that Timbal was guilty of acts or conduct inimical to the interests of ALU. It found that the acts imputed to Timbal were partisan activities, prohibited since the “freedom period” had not yet commenced as of that time. Thus, the Disloyalty Board recommended the expulsion of Timbal from membership in ALU, and likewise her dismissal from Del Monte in accordance with the Union Security Clause in the existing CBA between ALU and Del Monte.

Del Monte terminated Timbal and her co-employees, noting that the termination was “upon demand of [ALU] pursuant to provisions of the CBA.

Labor Arbiter affirmed that all five (5) were illegally dismissed and ordered Del Monte to reinstate 19

The Arbiter's Compendium


Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)complainants, including Timbal, to their former positions and to pay their full backwages and other allowances. This was reversed by the NLRC and modified by the CA which held that only Timbal was illegally dismissed.

In the present petition, Del Monte submits 2 grounds for review. First, it argued that an employer who acted in good faith in dismissing employees on the basis of a closed-shop provision is not liable to pay fullbackwages and 2nd, ALU should be made liable to Del Monte pursuant to the CBA

Issue - whether the Labor Arbiter correctly awarded full backwages to Timbal. Whether Court of Appeals erred when it did not rule on Del Monte’s claim for reimbursement against ALU

Ruling - The Labor Arbiter’s ruling, which entitled Timbal to claim full backwages and other allowances, “without qualifications and diminutions, computed from the time [she was] illegally dismisse[d] up to the time [she] will be actually reinstated,” conforms to Article 279 of the Labor Code. Hence, the Court of Appeals was correct in affirming the Labor Arbiter insofar as Timbal was concerned.

No. The law indubitably precludes the Labor Arbiter from enforcing money claims arising from the implementation of the CBA, the CBA herein complementarily recognizes that it is the Voluntary Arbitrators which have jurisdiction to hear the claim. The Labor Arbiter correctly refused to exercise jurisdiction over Del Monte’s cross-claim, and the Court of Appeals would have no basis had it acted differently

In reconciling the grants of jurisdiction vested under Articles 261 and 217 of the Labor Code, the Court has pronounced that “the original and exclusive jurisdiction of the Labor Arbiter under Article 217(c) for money claims is limited only to those arising from statutes or contracts other than a Collective Bargaining Agreement. The Voluntary Arbitrator or Panel of Voluntary Arbitrators will have original and exclusive jurisdiction over money claims ‘arising from the interpretation or implementation of the Collective Bargaining Agreement and, those arising from the interpretation or enforcement of company personnel policies’, under Article 261.” Thus, the Labor Arbiter in the instant case could not properly pass judgment on the cross-claim is further strengthened by the fact that Del Monte and ALU expressly recognized the jurisdiction of Voluntary Arbitrators in the CBA.33 Estate AbellaEstate of Nelson Dulay v. Aboitiz Jebsen Maritime, Inc.G.R. No. 172642, June 13, 2012Peralta, J.

Facts: Nelson Dulay worked as a seaman and, later on, as a bosun in General Charterers Inc., a subsidiary of Aboitiz Jebsen Maritime, Inc. 25 days after the completion of his contract, Nelson died due to acute renal failure secondary to septicaemia. His wife, Merridy Jane, claimed for death benefits through the grievance procedure of the CBA. However, it was declared deadlocked as Aboitiz refused to grant the benefits. Merridy Jane then filed a complaint with NLRC in General Santos City against respondents for death and medical benefits and damages. An amount of P20 000 was released by respondent pursuant to the CBA. However, Merridy Jane contended that she is entitled for $90 000. Respondent asserted that NLRC had no jurisdiction over the action on account of the absence of employee-employer relationship between GCI and Nelson at the time of the latter’s death. The LA ruled in favor of Nelson. The same was affirmed by NLRC. However, on appeal, CA ruled that it involves the interpretation and application of the provisions of the CBA. As such, jurisdiction belongs to VA and not to the LA.

Issue: Whether the VA has jurisdiction over the case.

Ruling: Yes. The issue in the complaint clearly involves the interpretation or implementation of the CBA and thus, jurisdiction belongs with VA. Articles 217(c) and 261 of the Labor Code provides that voluntary arbitrators have jurisdiction over cases arising from the interpretation or implementation of collective bargaining agreements. In any case, the Court agrees with petitioner's contention that the CBA is the law or contract between the parties. Article13.1 of the CBA entered into by and between respondent GCI and AMOSUP, the union to which petitioner belongs, provides that in case of conflict in the interpretation or application of the provisions of the CBA, or enforcement of company policies, it shall be settled through negotiation, conciliation or voluntary arbitration. From the foregoing, it is clear that the parties, in the first place, really intended to bring to conciliation or voluntary arbitration any dispute or conflict in the interpretation or



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)application of the provisions of their CBA. It is settled that when the parties have validly agreed on a procedure for resolving grievances and to submit a dispute to voluntary arbitration then that procedure should be strictly observed.

In the same manner, Section 29 of the prevailing Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean Going Vessels, promulgated by the Philippine Overseas Employment Administration (POEA), provides that in cases of claims and disputes arising from this employment, the parties covered by a collective bargaining agreement shall submit the claim or dispute to the original and exclusive jurisdiction of the voluntary arbitrator or panel of arbitrators. It is clear from the above that the interpretation of the DOLE, in consultation with their counterparts in the respective committees of the Senate and the House of Representatives, as well as the DFA and the POEA is that with respect to disputes involving claims of Filipino seafarers wherein the parties are covered by a collective bargaining agreement, the dispute or claim should be submitted to the jurisdiction of a voluntary arbitrator or panel of arbitrators. It is only in the absence of a collective bargaining agreement that parties may opt to submit the dispute to either the NLRC or to voluntary arbitration.34 Primero BorlasG.R. No. 72644 December 14, 1987ALFREDO F. PRIMERO, petitioner, vs.INTERMEDIATE APPELLATE COURT and DM TRANSIT, respondents. NARVASA, J.:

Facts: Petitioner Primero was discharged, for no reason or cause was given, from his employment as bus driver of DM Transit Corporation (DM) after having been employed therein for over 6 years. For 23 days, he was given a run-around from one management official to another, pleading that he be allowed to work as his family was in dire need of money and at the same time inquiring (why) he was not allowed to work or drive a bus of the company however got negative results and given cold treatment. He was advised by Munoz, Jr., Corporate President, that he will be given financial assistance only when he will sue them in court and lose. He was advised to seek employment with other bus firms. DM, in bad faith and with malice, persuaded other firms (California Transit, Pascual Lines, De Dios Transit, Negrita Corporation, and MD Transit) not to employ Primero in any capacity after he was already unjustly dismissed by said defendant. Primero instituted proceedings against DM with the Labor Arbiters of the Department of Labor for illegal dismissal. Labor Arbiter rendered judgment ordering DM to pay complainant separation. The judgment was affirmed by the National Labor Relations Commission and later by the Secretary of Labor. Three months afterwards, Primero brought suit against DM in the Court of First Instance of Rizal seeking recovery of damages caused not only by the breach of his employment contract, but also by the oppressive and inhuman, and consequently tortious, acts of his employer and its officers antecedent and subsequent to his dismissal from employment without just cause. Trial Court dismissed the complaint on the ground of lack of jurisdiction, for the reason that at the time that the complaint was filed on August 17, 1978, the law — the Labor Code as amended by PD 1367, eff. May 1, 1978 — conferred exclusive, original jurisdiction over claims for moral or other damages, not on ordinary courts, but on Labor Arbiters. IAC affirmed said decision, hence this petition. The decision was reached by a vote of 3 to 2. According to the dissenters, existence of employment relations was not alone decisive of the issue of jurisdiction, and that such relations may indeed give rise to "civil" as distinguished from purely labor disputes, as where an employer's right to dismiss his employee is exercised tortiously, in a manner oppressive to labor, contrary to morals, good customs or public policy. Primero has appealed to us from this judgment of the IAC praying that we overturn the majority view and sustain the dissent.

Issue: Whether Labor Arbiters have jurisdiction over claims for damages?

Ruling: The legislative intent appears clear to allow recovery in proceedings before Labor Arbiters of moral and other forms of damages, in all cases or matters arising from employer-employee relations. This would no doubt include, particularly, instances where an employee has been unlawfully dismissed. In such a case the Labor Arbiter has jurisdiction to award to the dismissed employee not only the reliefs specifically provided by labor laws, but also moral and other forms of damages governed by the Civil Code. Moral damages would be recoverable, for example, where the dismissal of the employee was not only effected without authorized cause and/or due process for which relief is granted by the Labor Code — but was attended by bad faith or fraud, or constituted an act oppressive to labor, or was done in a manner contrary to morals, good customs or public policy — for which the obtainable relief is determined by the Civil Code (not the Labor Code).35 PNB GubantesPNB vs Florence Cabansag




Jurisdiction of LA and NLRC as to a tourist employee hired in Singapore but worked for PNB Singapore Branch

Florence Cabansag arrived in Singapore as a tourist. She applied for employment with the Singapore Branch of the PNB, organized and existing under the laws of the Philippines. The Branch Office had two types of employees: a) expatriates or the regular employees, hired in Manila and assigned abroad and b) locally (direct) hired. Vice-President of the PNB offered her a temporary appointment as Credit Officer with several conditions which Florence accepted. The Philippine Embassy in Singapore processed the employment contract of Florence and was issued by the POEA an Overseas Employment Certificate certifying she was a bona fide contract worker for Singapore. After 3 months, Florence was asked to resign as a cost-cutting measure of the Bank. She was warned that unless she submitted her letter of resignation, her employment record will be blemished with the notation DISMISSED. The LA rendered judgment in favor of the complainant finding the Bank guilty of illegal dismissal and devoid of due process. NLRC and CA affirmed this decision and stated that even though respondent secured an employment pass from the Singapore Ministry of Employment, she did not waive Philippine labor laws, or the jurisdiction of the labor arbiter or the NLRC over her complaint for illegal dismissal. ISSUEWON the LA and NLRC has jurisdiction over a tourist employee hired in a foreign country but worked for PNB Singapore branch RULINGYes. Based on the provisions of Art. 217 of the LC, and Sec.10 of RA 8042, labor arbiters clearly have original and exclusive jurisdiction over claims arising from EE, including termination disputes involving all workers, among whom are overseas Filipino workers. Securing the employment pass from the Singaporean Ministry of Manpower does not automatically mean that the non-citizen is thereby bound by local laws only. It does not at all imply a waiver of one's national laws on labor. Noteworthy is the fact that respondent likewise applied for and secured an Overseas Employment Certificate from the POEA through the Phil. Embassy in Singapore. Under our law, this document authorized her working status in a foreign country and entitled her to all benefits and processes under our statutes.36 Santiago JimenezSantiago v. CF Sharp Crew Management, Inc.GR No. 162419, July 10, 2007 ( Jurisdiction over money claims of OFW’s even without employment contract)

Facts:Petitioner had been working as a seafarer for Smith Bell Management, Inc. (respondent) for about five (5) years. He signed a new contract of employment with the duration of 9 months on Feb 3 1998 and he was to be deployed 10 days after. This contract was approved by POEA. A week before the date of departure, the respondent received a phone call from petitioner’s wife and some unknown callers asking not to send the latter off because if allowed, he will jump ship in Canada.

Because of the said information, petitioner was told that he would not be leaving for Canada anymore. This prompted him to file a complaint for illegal dismissal against the respondent. The LA held the latter responsible. On appeal, the NLRC ruled that there is no employer-employee relationship between petitioner and respondent, hence, the claims should be dismissed. The CA agreed with the NLRC’s finding that since petitioner had not departed from the Port of Manila, no employer-employee relationship between the parties arose and any claim for damages against the so-called employer could have no leg to stand on.

Issue:Whether the seafarer, who was prevented from leaving the port of Manila and refused deployment without valid reason but whose POEA approved employment contract provides that EER shall commence only upon the seafarers actual departure from the port in the point of hiring is entitled to relief

Ruling:Yes. Despite the absence of an employer-employee relationship between petitioner and respondent, the Court rules that the NLRC has jurisdiction over petitioner’s complaint. The jurisdiction of labor arbiters is not limited to claims arising from employer-employee relationships. Section 10 of R.A. No. 8042 (Migrant Workers Act), provides that:




Sec. 10. Money Claims. – Notwithstanding any provision of law to the contrary, the Labor Arbiters of the National Labor Relations Commission (NLRC) shall have the original and exclusive jurisdiction to hear and decide, within ninety (90) calendar days after the filing of the complaint, the claims arising out of an employer-employee relationship or by virtue of any law or contract involving Filipino workers for overseas deployment including claims for actual, moral, exemplary and other forms of damages. x x x [Emphasis supplied]

Since the present petition involves the employment contract entered into by petitioner for overseas employment, his claims are cognizable by the labor arbiters of the NLRC.37 Medline JuradoMedline Management Inc. V. RoslindaGR 168715. Sept. 15,10Ponenten. Del Castillo

Facts. Petitioner was a shipping agency. Then, Roslinda was hired to work abroad as an oiler. The respondent, after his repatriation, consulted a doctor due to his distended abdomen which eventually found out that he was suffering from renal failure and must undergo a hemodialysis, which method of removing waste products in the blood when the kidneys are in renal failure.

Unfortunately, Roslinda died. His heir filed a complaint against petitioner for payment of death and medical compensation before the Labor Arbiter. However, petitioner contended that the Labor Arbiter has no jurisdiction because there exist Employer- Employee Relationship between them.

Issue. Whether the contention of the petitioner is meritorious?

Held. Yes. Roslinda did not die while he was under the employ of petitioners. His contract of employment ceased after having completed his contract thereat. He died a year after the expiration of his contract. Thus, his beneficiaries are not entitled to the death benefits under the Standard Employment Contract for Seafarers. Moreover, there is no evidence to show that Juliano’s illness was acquired during the term of his employment with petitioners. In respondents’ Position Paper, they admitted that Juliano was discharged not because of any illness but due to the expiration of his employment contract. Instead, what respondents presented were the Medical Certificates issued by Dr. Lloren attesting to the fact that on March 6, 2000, Juliano consulted her complaining of abdominal distention. We find this not substantial evidence to prove that Juliano’s illness which caused his death was contracted during the term of his contract.[29] “Indeed, the death of a seaman several months after his repatriation for illness does not necessarily mean that: a) the seaman died of the same illness; b) his working conditions increased the risk of contracting the illness which caused his death; and c) the death is compensable, unless there is some reasonable basis to support otherwise.”[30] In the instant case, Juliano was repatriated not because of any illness but because his contract of employment expired. There is likewise no proof that he contracted his illness during the term of his employment or that his working conditions increased the risk of contracting the illness which caused his death.38 Ace Otsuka

39 WPP PiedadWPP Communications v. GaleraGR. no. 169207 Mar. 25, 2010Carpio, Acting CJ .:

Facts: Jocelyn Galera is an American Citizen recruited by the WPP chairman to work in the Philippines. They signed the contract providing for the benefits of housing and full maintenance of the company car. She was designated as Vice President for WPP but on the following year, she was advised that her services were terminated. Galera filed a complaint for illegal dismissal plus the benefits accorded her as an employee. The Labor Arbiter ruled in favor of Galera but was reversed by the NLRC in lieu of her being a corporate officer and subject to the SEC rules.

Issue: Whether or not Galera is an employee or a corporate officer

Ruling: She is an employee. Thus, this case is subject to the jurisdiction of the NLRC and the Labor Arbiter.



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest) Corporate officers are given such character either by a corporation Code or by the corporation’s by-laws. Under Sec. 25 of the Corporate Code, te corporate officers are the president, secretary and other officers as may be provided by the by-laws. Other officers are sometimes created by the charter or by-laws of a corporation, or the board of directors may be empowered under the by-laws to create additional offices as may be necessary.

In this case, it is found out that by the corporate by laws, only one Vice President position is created which is taken and unamended during Galera’s employment. Hence, with no corporate office to speak of but there is a valid employment, Galera is an employee of the corporation.40 Galera RigorWPP VS. GALERAG.R. NO. 169207GALERA VS. WPPG.R. NO. 169239MARCH 25, 2010CARPIO, Acting C.J.:

FACTS: Petitioner is Jocelyn Galera, an American citizen who was recruited from the US by private respondent John Steedman, Chairman-WPP Worldwide and Chief Executive Officer of Mindshare, Co., a corporation based in Hong Kong, China, to work in the Philippines for private respondent WPP Marketing Communications, Inc. (WPP). On December 14, 2000, GALERA alleged she was verbally notified by private STEEDMAN that her services had been terminated from private respondent WPP. A termination letter followed the next day. On 3 January 2001, Galera filed a complaint for illegal dismissal, holiday pay, service incentive leave pay, 13th month pay, incentive plan, actual and moral damages, and attorney's fees against WPP and/or John Steedman (Steedman), Mark Webster (Webster) and Nominada Lansang (Lansang). The Labor Arbiter's Ruling for illegal dismissal and damages in favor of GALERA. The First Division of the NLRC reversed the ruling of Arbiter Madriaga. Yet it was reversed again by CA.

ISSUE:

Whether Galera is an Employee or a Corporate Officer?

RULING: EMPLOYEE.

Galera, on the belief that she is an employee, filed her complaint before the Labor Arbiter. On the other hand, WPP, Steedman, Webster and Lansang contend that Galera is a corporate officer; hence, any controversy regarding her dismissal is under the jurisdiction of the Regional Trial Court. We agree with Galera. Corporate officers are given such character either by the Corporation Code or by the corporation's by-laws. Galera's appointment as a corporate officer (Vice-President with the operational title of Managing Director of Mindshare) during a special meeting of WPP's Board of Directors is an appointment to a non-existent corporate office. At the time of Galera's appointment, WPP already had one Vice-President in the person of Webster and all five directorship positions provided in the by-laws are already occupied. Another indicator that she was a regular employee and not a corporate officer is Section 14 of the contract, which clearly states that she is a permanent employee — not a Vice-President or a member of the Board of Directors. Another convincing indication that she was only a regular employee and not a corporate officer is the disciplinary procedure, which states that her right of redress is through Mindshare's Chief Executive Officer for the Asia-Pacific. This implies that she was not under the disciplinary control of private respondent WPP's Board of Directors (BOD), which should have been the case if in fact she was a corporate officer because only the Board of Directors could appoint and terminate such a corporate officer.

WPP's dismissal of Galera lacked both substantive and procedural due process. Apart from Steedman's letter dated 15 December 2000 to Galera, WPP failed to prove any just or authorized cause for Galera's dismissal. Steedman's letter to Galera reads: The operations are currently in a shamble. There is lack of leadership and confidence in your abilities from within, our agency partners and some clients. Most of the staff I spoke with felt they got more guidance and direction from Minda than yourself. In your role as Managing Director, that is just not acceptable. I believe your priorities are mismanaged. The recent situation where you felt an internal strategy meeting was more important than a new business pitch is a good example. You failed to lead and advise on the two new business pitches. In both cases, those involved sort (sic) Minda's input. As I discussed



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)with you back in July, my directive was for you to lead and review all business pitches. It is obvious [that] confusion existed internally right up until the day of the pitch. The quality output is still not to an acceptable standard, which was also part of my directive that you needed to focus on back in July. I do not believe you understand the basic skills and industry knowledge required to run a media special operation.

WPP, Steedman, Webster, and Lansang, however, failed to substantiate the allegations in Steedman's letter. Galera, on the other hand, presented documentary evidence 22 in the form of congratulatory letters, including one from Steedman, which contents are diametrically opposed to the 15 December 2000 letter. The law further requires that the employer must furnish the worker sought to be dismissed with two written notices before termination of employment can be legally effected: (1) notice which apprises the employee of the particular acts or omissions for which his dismissal is sought; and (2) the subsequent notice which informs the employee of the employer's decision to dismiss him. Failure to comply with the requirements taints the dismissal with illegality. 23 WPP's acts clearly show that Galera's dismissal did not comply with the two-notice rule.41 MAtling ValeraMATLING INDUSTRIAL V COROS

FACTS:Coros was dismissed by the petitioner as Vice President for Finance and Administration and former filed for illegal suspension and illegal dismissal against Matling and some of its corporate officers in the NLRC. Petitioners moved to dismiss the complaint contending that the same pertained to the jurisdiction of the SEC due to controversy being intra-corporate inasmuch as the respondent was am member of Matling’s board of directors aside from its VP for finance and administration prior to its termination.

ISSUE: Whether the respondent was a corporate officer of the petitioner.

Whether the LA or RTC had jurisdiction over the complaint for illegal dismissal.

RULING:LA: Granted petitioner’s motion to dismiss ruling that the respondent was a corporate officer because he was occupying the position of VP for finance and administration and at the same time a member of the board of directors of Matling.

NLRC: Set aside the dismissal concluding that the respondent’s complaint for illegal dismissal was properly cognizable by the LA not by SEC because he was not a corporate officer by virtue of his position in Matling, albeit high ranking and managerial, not being among the positions listed in Matling’s comstitution and by-laws.

CA: dismissed the petition for certiorari. The position for VP for admin and finance which Coros used to hold was not created by the corporation’s board of directors but only by its president or executive VP pursuant to the by-laws of their corporation. Coro’s illegal dismissal is within the jurisdiction of LA.

SC: denied the petition for review and affirm the decision of the CA.

Conformably with the sec 25, a position must be expressly mentioned by the by-laws in order to be considered as a corporate office. Thus, the election of an office pursuant to or under the by-law enabling provision is not enough to make the position a corporate office. The rest of the corporate offices could be considered only as employees or subordinate officials.In order to determine whether a dispute constitutes an intra-corporate controversy or not, the court considers the elements: (1) the status or relationship of the parties; (2) the nature of the question that is the subject of their controversy.42 Locsin AbadCase title – Locsin v. Nissan Car Lease Phils, Inc.GR number – 185567Date – 20 October 2010Ponente - BRION, J

Facts - Locsin was elected Executive Vice President and Treasurer (EVP/Treasurer) of NCLPI. A little over 7 months after his election as Chairman of the Board, the NCLPI Board held a special meeting and one of the items of the agenda was the election of a new set of officers. Unfortunately, Locsin was neither re-elected Chairman nor reinstated to his previous position as EVP/Treasurer.




Aggrieved, Locsin filed a complaint for illegal dismissal with prayer for reinstatement, payment of backwages, damages and attorney’s fees before the Labor Arbiter against NCLPI and Banson, who was then President of NCLPI.

NCLPI and Banson filed a Motion to Dismiss,on the ground that the Labor Arbiter did not have jurisdiction over the case since the issue of Locsin’s removal as EVP/Treasurer involves an intra-corporate dispute.

LA issued an Order denying the Motion to Dismiss, holding that her office acquired “jurisdiction to arbitrate and/or decide the instant complaint finding extant in the case an employer-employee relationship. This was reversed by the CA ruling that Locsin was a corporate officer; the issue of his removal as EVP/Treasurer is an intra-corporate dispute under the RTC’s jurisdiction

Issue – whether the removal of Locsin is an intra-corporate dispute and thus , does not fall under jurisdiction of LA

Ruling - CA correctly ruled that no employer-employee relationship exists between Locsin and Nissan. Locsin was undeniably Chairman and President, and was elected to these positions by the Nissan board pursuant to its By-laws. As such, he was a corporate officer, not an employee. The CA reached this conclusion by relying on the submitted facts and on Presidential Decree 902-A, which defines corporate officers as “those officers of a corporation who are given that character either by the Corporation Code or by the corporation’s by-laws.” Likewise, Section 25 of Batas Pambansa Blg. 69, or the Corporation Code of the Philippines (Corporation Code) provides that corporate officers are the president, secretary, treasurer and such other officers as may be provided for in the by-laws.

Even as Executive Vice-President/Treasurer, Locsin already acted as a corporate officer because the position of Executive Vice-President/Treasurer is provided for in Nissan’s By-Laws. In this case, Locsin was elected by the NCLPI Board, in accordance with the Amended By-Laws of the corporation

Given Locsin’s status as a corporate officer, the RTC, not the Labor Arbiter or the NLRC, has jurisdiction to hear the legality of the termination of his relationship with Nissan. As held in Okol, a corporate officer’s dismissal from service is an intra-corporate dispute: In a number of cases it was held that a corporate officer’s dismissal is always a corporate act, or an intra-corporate controversy which arises between a stockholder and a corporation.43 Renato AbellaRenato Real v. Sangu Philippines, Inc.GR No. 168757, January 19, 2011Del Castillo, J.

Facts: Renato Real was the Manager of respondent corporation Sangu Philippines, Inc. which is engaged in the business of providing manpower for general services. He filed a complaint for illegal dismissal against the respondents stating that he was neither notified of the Board meeting during which his removal was discussed nor was he formally charged with any infraction.

Respondents, on the other hand, said that Real committed gross acts of misconduct detrimental to the company since 2000. The LA declared petitioner as having been illegally dismissed. Sangu appealed to NLRC and established petitioner’s status as a stockholder and as a corporate officer and hence, his action against respondent corporation is an intra-corporate controversy over which the Labor Arbiter has no jurisdiction. NLRC modified the LA’s decision. On appeal, the CA affirmed the decision of NLRC. Issue: Whether Real’s complaint for illegal dismissal constitutes an intra-corporate controversy.

Ruling: No. The case does not involve an intra-corporate controversy. Not all conflicts between the stockholders and the corporation are classified as intra-corporate. There are other factors to consider in determining whether the dispute involves corporate matters as to consider them as intra-corporate controversies.

To determine whether a case involves an intra-corporate controversy, and is to be heard and 26



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)decided by the branches of the RTC specifically designated by the Court to try and decide such cases, two elements must concur: (a) the status or relationship of the parties, and (2) the nature of the question that is the subject of their controversy.

The first element requires that the controversy must arise out of intra-corporate or partnership relations between any or all of the parties and the corporation. The second element requires that the dispute among the parties be intrinsically connected with the regulation of the corporation. If the nature of the controversy involves matters that are purely civil in character, necessarily, the case does not involve an intra-corporate controversy.44 Prudential Borlas G.R. No. 141093. February 20, 2001PRUDENTIAL BANK and TRUST COMPANY, petitioner, vs. CLARITA T. REYES, respondent.GONZAGA-REYES, J.:

Facts: Clarita Tan Reyes was appointed Accounting Clerk by Prudential Bank and Trust Company (bank) and rose to become supervisor. She was appointed Assistant Vice-President in the foreign department of the Bank, tasked with the duties, among others, to collect checks drawn against overseas banks payable in foreign currency and to ensure the collection of foreign bills or checks purchased, including the signing of transmittal letters covering the same, until her illegal dismissal. Her length of service with the bank was equivalent to 28 years. The auditors of the Bank discovered that two checks, received by the Bank were not sent out for collection to Hong Kong Shanghai Banking Corporation (HSBC) on her order until the said checks became stale. After thorough investigation, the Board has resolved not to re-elect her position here services were terminated. She filed a complaint for illegal suspension and illegal dismissal and alleged that alleged that the real reason for her dismissal was her filing of the criminal cases against the bank president, the vice president and the auditors of the Bank, such filing not being a valid ground for her dismissal. LA ruled in favor of Reyes however NLRC reversed the said decision and ruled that dismissal was valid. CA reinstated LA’s decision hence this petition. The bank argued that the dispute is an intra-corporate controversy as it does the non-election of private respondent to the position of Assistant Vice-President of the Bank which falls under the exclusive and original jurisdiction of the Securities and Exchange Commission (now the Regional Trial Court) under Section 5 of Presidential Decree No. 902-A.

Issue: Whether the dispute is an intra-corporate controversy?

Ruling: The bank’s contention that she merely holds an elective position and that in effect she is not a regular employee is belied by the nature of her work and her length of service with the Bank. It has been stated that “the primary standard of determining regular employment is the reasonable connection between the particular activity performed by the employee in relation to the usual trade or business of the employer. Additionally, “an employee is regular because of the nature of work and the length of service, not because of the mode or even the reason for hiring them.” As Assistant Vice-President of the Foreign Department of the Bank she performs tasks integral to the operations of the bank and her length of service with the bank totaling 28 years speaks volumes of her status as a regular employee of the bank. In fine, as a regular employee, she is entitled to security of tenure; that is, her services may be terminated only for a just or authorized cause.

Petitioner Bank can no longer raise the issue of jurisdiction under the principle of estoppel. The Bank participated in the proceedings from start to finish. It was only when the Court of Appeals ruled in favor of private respondent did it raise the issue of jurisdiction. The Bank actively participated in the proceedings before the Labor Arbiter, the NLRC and the Court of Appeals. . Hence, a party may be estopped or barred from raising the question of jurisdiction for the first time in a petition before the Supreme Court when it failed to do so in the early stages of the proceedings.45 Rural GubantesRural Bank of Coron vs CortesA corporate officer may also be an employee whose dismissal may vest jurisdiction on the LA

FACTSAnnalisa Cortes was hired as the Corporate Secretary and Personnel Officer of the Rural Bank of Coron, and a Personnel Officer of both Empire Cold Storage and Development Corporation, and Citizens Development Inc. Upon inspection of the books of the said corporations where Annalisa was hired as a personnel officer, it was discovered that the latter was involved in several anomalies, prompting them to terminate her services from the corporations. Annalisa stated her



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)willingness to abide the decision regarding her termination but stressed her right to separation pay. When her demand went unheeded, she filed a complaint for illegal dismissal and non-payment of salaries and other benefits. The petitioners moved for the dismissal of the complaint on the ground that it was an intra-corporate controversy involving the removal of a corporate officer. The LA found that Annalisa was not a corporate officer, and thus the case falls within the ambit of the jurisdiction of the LA.

ISSUEWON Cortes is a corporate officer of the said corporations.

RULINGNo. While Cortes was the Corporate Secretary of the Rural Bank of Coron, she was also its Financial Assistant and the Personnel Officer of the two other petitioner corporations. Jurisprudence instructs that a corporation can engage its corporate officers to perform services under a circumstance which would make them employees. The Labor Arbiter has thus jurisdiction over Cortes' complaint.46 Feliciano JimenezFeliciano v. Commission on AuditGR No. 1474202, January 14, 2004 (issues involving GOCC’s and its employees)

Facts:COA assessed Leyte Metropolitan Water District (LMWD) auditing fees. Petitioner Feliciano, as General Manager of LMWD, contended that the water district could not pay the said fees on the basis of Sections 6 and 20 of P.D. No. 198 as well as Section 18 of R.A. No. 6758. He primarily claimed that LMWD is a private corporation not covered by COA's jurisdiction. Petitioner also asked for refund of all auditing fees LMWD previously paid to COA. COA Chairman denied petitioner’s requests. Petitioner filed a motion for reconsideration which COA denied. Hence, this petition.

Issue: Whether a Local Water District (“LWD”) created under PD 198, as amended, is a government-owned or controlled corporation subject to the audit jurisdiction of COA or a private corporation which is outside of COA’s audit jurisdiction.

Ruling:Petition lacks merit. The Constitution under Sec. 2(1), Article IX-D and existing laws mandate COA to audit all government agencies, including government-owned and controlled corporations with original charters. An LWD is a GOCC with an original charter. The COA audit jurisdiction extends not only to government “agencies or instrumentalities” but also to “government owned and controlled corporation with original charters” as well as “other government-owned or controlled corporations” wthout original charters.The determining factor of COA’s audit jurisdiction is government ownership or control of the corporation.47 Luzviminda JuradoLuzviminda Ang V. PNBGR 178762. June 16,10Ponente. Abad

Facts PNB, then a GOCC, hired Ang as a probationary clerk, eventually became an Asst. Manger. When the PNB was privatized, she was deemd automatically retired. But the PNB re- employed her and assigned her in Tuguegarao. Subsequently, PNB administratively charged her with serious misconduct and willful breach of trust for taking part in a scam called " kiting operwtion. " where a depositor used a conduit account for depositing several unfunded checks drawn against the same depositor's other current accounts and from which the conduit bank account he later withdrew those checks. Ang contended that the bank did not suffer loss and alos pointed out that th causes for her terminationtook place when she was yet a government official, that the PNB had ceased to be government owned.

Issue. whether the contetion of Ang is meritorious?

Held. No. When PNB began as a Government Corporation, it did not mean that its corporate being ceased, and was subsequently re-established when it was privatized.

It remained th same corporate entity before, during, and after the change over with no break in its life as a corporation. The offenses that Ang committed against the bank before its privatization



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)continued to be offenses against the bank after privatization.

48 Casino OtsukaCasino labor ASSOCIATION vs. CA,PCOC and PSSCPonente: PUNO C.J.:JURISDICTION ON GOCC DISMISSAL CASE

Facts: On July 20, 1987, the Labor Arbiter dismissed the consolidated cases for lack of jurisdiction as well as the NLRC as the same over PAGCOR , PCOC and PSSC. The petitioner filed a motion for review on certiorari to the CA which was denied, the same with the petition for reconsideration filed by the petitioner with finality dated March 15, 1989 Resolution . The resolution in part states:

“xxx Any petitions brought against private companies will have to be brought before the appropriate agency or office of the of the Department of Labor and Employment. Petitioner filed a manifestation/ motion that the records of the case be remanded to the Arbitration Branch for proper prosecution and disposition thereof which was granted on 30th of June 1989 for further proceedings. The petitioner appeals via certiorari on the grounds that NLRC committed grave abuse of discretion.

Issue: Whether the NLRC have jurisdiction over the E-ER REL problems over GOCC.

Held: NO. the NLRC has no jurisdiction over PAGCOR, PCOC and PSSC. In accordance with the Constitution and jurisprudence, corporations with original charter” fall under the jurisdiction of the Civil Service Commission and not the Labor Department.

The petition was dismissed and the decision of the CA was affirmed.49 Postigo PiedadPostigo v. Philippine TuberculosisGR.no. 155146 Jan.24, 2006QUISUMBING, J.:

Facts: Petitioners Dr. Perla A. Postigo, et al., were regular employees of the respondent Philippine Tuberculosis Society, Inc. (PTSI). Upon retirement from service, some of the petitioners who were compulsory members of the Government Service Insurance System (GSIS) obtained retirement benefits from the GSIS. At the time the petitioners retired, Article 287 of the Labor Code had been amended by Republic Act No. 7641. Rep. Act No. 7641 granted retirement pay to qualified employees in the private sector, in the absence of any retirement plan or agreement with the company. As the respondent did not have a retirement plan for its employees, aside from its contribution to the GSIS, petitioners claimed from the respondent their retirement benefits under Rep. Act No. 7641. The respondent denied their claims on the ground that the accommodation extended by the GSIS to the petitioners removed them from the coverage of the law. When they consulted the Bureau of Working Conditions, it opined that they are entitled with such benefits. Despite this, respondent refused to give them the benefits. The petitioners filed a complaint with the Labor Arbiter.

Issue: Whether or not Petitioners are entitled to the benefits of the Retirement Pay Law.

Ruling: Yes. The respondent was incorporated as a non-profit, benevolent and non-stock corporation under the Corporation Code. Having been created under the general corporation law instead of a special charter, we hold that the respondent is a private and not a governmental corporation. The Philippine Tuberculosis Society, Inc. (PTSI) belongs to the latter category and, therefore, covered by Rep. Act No. 7641 which is an amendment to the Labor Code. Extant on the records is the respondent’s admission that although its employees are compulsory members of the GSIS, said employees are not governed by the Civil Service Law. If the respondent is truly a government-owned or controlled corporation, and petitioners are employees in the public sector, then, they should have been covered by said law. The truth, however, is that, the respondent is a non-profit but private corporation organized under the Corporation Code, and the petitioners are covered by the Labor Code and not by the Civil Service Law.

Employees of government-owned and controlled corporations with special charters are covered under the Civil Service. On the other hand, employees of government-owned and controlled



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)corporations under the Corporation Code are governed by the provisions of the Labor Code.50 Camporedondo RigorBALTAZAR CAMPOREDONDO VS. NLRCG.R. NO. 129049 AUGUST 6, 1999PARDO, J.:

FACTS: Petitioner was employed with the Philippine National Red Cross (PNRC) since 1980, and until his early “retirement” on December 15, 1995, he was administrator of the Surigao del Norte Chapter, Philippine National Red Cross. Then field auditor of the PNRC conducted an audit of the books of account of the Surigao del Norte Chapter headed by petitioner and found him short in the total sum of P109,000.00. Dr. Celso Samson, Secretary General of the PNRC wrote petitioner requiring him to restitute within seventy two hours from notice, the total sum of P135,927.78 representing cash shortage, technical shortage and unremitted collections. Upon filing his early retirement he wrote a letter to Dr. Samson requesting for a re-audit by an independent auditor of his accounts. However, Dr. Samson denied the request. Because of denying his request petitioner filed with the National Labor Relations Commission complaint for illegal dismissal, damages and underpayment of wages against the Philippine National Red Cross and its key officials. Respondent Philippine National Red Cross filed with the Surigao del Norte provincial office, Department of Labor and Employment, a motion to dismiss the complaint for lack of jurisdiction over the subject matter of the case because the PNRC is a government corporation whose employees are members of the Government Service Insurance System, and embraced within the Civil Service Law and regulations. Petitioner filed an opposition to motion to dismiss arguing that there was between the PNRC and its duly appointed paid staff, an employer-employee relationship, governed by the Labor Code of the Philippines. The Labor Arbiter issued an order dismissing the complaint for lack of jurisdiction, finding that the Philippine National Red Cross is a government corporation with an original charter, having been created by Republic Act No. 95. Petitioner filed an appeal but the NLRC denied the petition and upheld Labor arbiters decision that dismissed petitioner’s complaint for lack of jurisdiction. ISSUE: Whether the Philippine National Red Cross is a government owned and controlled corporation or it has been “impliedly converted to a private organization” subject to the jurisdiction of labor tribunals in a complaint filed by petitioner?

RULING: NO.

Resolving the issue set out in the opening paragraph of this opinion, we rule that the Philippine National Red Cross (PNRC) is a government owned and controlled corporation, with an original charter under Republic Act No. 95, as amended. The test to determine whether a corporation is government owned or controlled or private in nature is simple. Is it created by its own charter for the exercise of a public function, or by incorporation under the general corporation law? Those with special charters are government corporations subject to its provisions, and its employees are under the jurisdiction of the Civil Service Commission, and are compulsory members of the Government Service Insurance System. The PNRC was not “impliedly converted to a private corporation” simply because its charter was amended to vest in it the authority to secure loans, be exempted from payment of all duties, taxes, fees and other charges of all kinds on all importations and purchases for its exclusive use, on donations for its disaster relief work and other services and in its benefits and fund raising drives, and be allotted one lottery draw a year by the Philippine Charity Sweepstakes Office for the support of its disaster relief operation in addition to its existing lottery draws for blood program.

Having served in the Philippine National Red Cross for a number of years since his initial employment, he must know that it is a government corporation with its own charter and that he was covered by compulsory membership in the Government Service Insurance System, which is why he could apply, as he did, for “early” retirement from the service under Presidential Decree No. 1146 or Republic Act No. 1616.51 Trade ValeraTRADE UNIONS V NATIONAL HOUSING

FACTS:Trade unions of the Phils and Allied (TUPAS) was a legitimate organization with a chapter in NHC. TUPAS filed a petition for the conduct of a certification election to determine the exclusive bargaining representative of workers of NHC but was denied. The reason for this is because “being a gov’t-owned or controlled corporation its employees are prohibited to form, join, or assist any labor organization for purposes of collective bargaining pursuant to Sec 1, Rule II, Book V of the



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)Rules and Regulations Implementing the Labor Code.”

TUPAS appealed to the Bureau of Labor Relations reversing the dismissal and ordering the holding of a certification election. This decision was later set aside upon motion for reconsideration of respondent NHC. Hence this petition.

ISSUE:Whether the employees of NC may conduct a certification election.

RULING:Yes. The rule was modified in the 1987 Constitution, the corresponding provision whereof declares “the civil service embraces all branches, subdivisions, instrumentalities, and agencies of the government, including government owned or controlled corporations WITH ORIGINAL CHARTERS.”There is therefore, no impediment to the holding of the election among the workers of the NHC for it is clear that they are covered by the Labor Code, the NHC being a government controlled corporation without an original charter.52 Hugo AbadCase title – Hugo v. LRTAGR number – 181866Date – 18 March 2010Ponente –

Facts - Respondent Light Rail Transit Authority (LRTA), a government-owned and controlled corporation, constructed a light rail transit system which traverses from Baclaran in Parañaque City to Monumento in Kalookan City. To effectively carry out its mandate, LRTA entered into a ten-year Agreement for the Management and Operation of the Metro Manila Light Rail Transit System. METRO thus hired its own employees including herein petitioners-members of the Pinag-isang Lakas ng Manggagawa sa METRO, Inc.-National Federation of Labor, otherwise known as PIGLAS-METRO, INC.-NFL-KMU (the Union), the certified exclusive collective bargaining representative of METRO’s rank-and-file employees.

On account of a deadlock in the negotiation for the forging of a new collective bargaining agreement between METRO and the Union, petitioners filed a Notice of Strike. Then Secretary of Labor directed the striking employees including herein petitioners to immediately return to work and METRO to accept them back under the same terms and conditions of employment prevailing prior to the strike. By LRTA’s claim, the striking employees including petitioners defied the return-to-work order.

When the Agreement expired,LRTA did not renew it. It instead took over the management and operations of the light rail transit system, hiring new personnel for the purpose. METRO thus considered the employment of all its personnel terminated.

Petitioners then filed a complaint for illegal dismissal and unfair labor practice with prayer for reinstatement and damages against METRO and LRTA. LRTA filed a motion to dismiss on the ground that the Labor Arbiter and the NLRC have no jurisdiction over it, for, by petitioners’ own admission, there was no employer-employee relationship between it and petitioners.

Issue – whether the LA and/or the NLRC has jurisdiction over the case.Ruling - The Labor Arbiter and the NLRC do not have jurisdiction over LRTA. Petitioners themselves admitted in their complaint that LRTA “is a government agency organized and existing pursuant to an original charter (Executive Order No. 603),” and that they are employees of METRO. Light Rail Transit Authority v. Venus, Jr., 485 SCRA 361 (2006), which has a similar factual backdrop, holds that LRTA, being a government-owned or controlled corporation created by an original charter, is beyond the reach of the Department of Labor and Employment which has jurisdiction over workers in the private sector, viz: . . . [E]mployees of petitioner METRO cannot be considered as employees of petitioner LRTA. The employees hired by METRO are covered by the Labor Code and are under the jurisdiction of the Department of Labor and Employment, whereas the employees of petitioner LRTA, a government-owned and controlled corporation with original charter, are covered by civil service rules. Herein private respondent workers cannot have the best of two worlds, e.g., be considered government employees of petitioner LRTA, yet allowed to strike as private employees under our labor laws. x x



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)x.53 Pakistan AbellaPakistan International Airlines Corp. v. OpleGR No. 61594, September 28, 1990Feliciano, J.

Facts: Pakistan International Airlines Corporation (PIA), a foreign corporation, executed in Manila two separate contracts of employment with private respondents, Farrales and Mamasig. The contract provides the following:

5. DURATION OF EMPLOYMENT AND PENALTYThis agreement is for a period of 3 years, but can be extended by the mutual consent of the parties.

6. TERMINATIONNotwithstanding anything to contrary as herein provided, PIA reserves the right to terminate this agreement at any time by giving the EMPLOYEE notice in writing in advance one month before the intended termination or in lieu thereof, by paying the EMPLOYEE wages equivalent to one month’s salary.

10. APPLICABLE LAWThis agreement shall be construed and governed under and by the laws of Pakistan, and only the Courts of Karachi, Pakistan shall have the jurisdiction to consider any matter arising out of or under this agreement.

Private respondents were hired as flight attendants after undergoing training. Sometime prior to the expiration of the contracts of employment, PIA sent separate letters informing them that they will be terminated. Private respondents jointly instituted a complaint for illegal dismissal and non-payment of company benefits and bonuses against PIA with the Ministry of Labor and Employment. PIA claimed that the services of both private respondents were terminated pursuant to the provisions of the employment contract. Private respondents had a favourable decision stating that private respondents had attained the status of regular employees after they had rendered more than a year of continued service; that the stipulation limiting the period of the employment contract to 3 years was null and void as violative of the provisions of the Labor Code and its implementing rules and regulations on regular and casual employment; and that the dismissal, having been carried out without the requisite clearance from the MOLE, was illegal. The decision was sustained on appeal.

Issue: Whether Pakistan law should be applied in the case as provided in the contract.

Ruling: The Sc held that PIA cannot take refuge in paragraph 10 of its employment agreement which specifies, firstly, the law of Pakistan as the applicable law of the agreement and, secondly, lays the venue for settlement of any dispute arising out of or in connection with the agreement “only in courts of Karachi, Pakistan”. The first clause of paragraph 10 cannot be invoked to prevent the application of Philippine labor laws and regulations to the subject matter of this case, , i.e., the employer-employee relationship between petitioner PIA and private respondents. It has already been pointed out that relationship is much affected with public interest and that the otherwise applicable Philippine laws and regulations cannot be rendered illusory by the parties agreeing upon some other law to govern their relationship. Neither may petitioner invoke the second clause of paragraph 10, specifying the Karachi courts as the sole venue for the settlement of disputes between the contracting parties. Even a cursory scrutiny of the relevant circumstances of this case will show the multiple and substantive contacts between Philippine law and Philippine courts, on the one hand, and the relationship between the parties, upon the other: the contract was not only executed in the Philippines, it was also performed here, at least partially; private respondents are Philippine citizens and residents, while petitioner, although a foreign corporation, is licensed to do business (and actually doing business) and hence resident in the Philippines; lastly, private respondents were based in the Philippines in between their assigned flights to the Middle East and Europe. All the above contacts point to the Philippine courts and administrative agencies as a proper forum for the resolution of contractual disputes between the parties.

Under these circumstances, paragraph 10 of the employment agreement cannot be given effect so as to oust Philippine agencies and courts of the jurisdiction vested upon them by Philippine law. Finally, and in any event, the petitioner PIA did not undertake to plead and prove the contents of Pakistan law on the matter; it must therefore be presumed that the applicable provisions of the law of Pakistan are the same as the applicable provisions of Philippine law.



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)54 SEAFDEC BorlasG.R. Nos. 97468-70 September 2, 1993SOUTHEAST ASIAN FISHERIES DEVELOPMENT CENTER represented by its Chief, DR. FLOR J. LACANILAO, petitioner, vs.DANILO ACOSTA in his capacity as Labor Arbiter of the National Labor Relations Commission, Regional Arbitration, Branch VI, CORAZON CANTO, DAN BALIAO, ELIZABETH SUPETRAN, CARMELITA FERRER, CATHRYN CONTRADOR, and DORIC VELOSO, respondents. VITUG, J.:

Facts: Two labor cases were filed by the herein private respondents against the petitioner, before the National Labor Relations Commission (NLRC), Regional Arbitration Branch, Iloilo City and claimed having been wrongfully terminated from their employment by the petitioner. The petitioner, contended to be an international inter-government organization, composed of various Southeast Asian countries, filed a Motion to Dismiss, challenging the jurisdiction of the public respondent in taking cognizance of the above cases. LA denied said motion and as wells as petitioners motion for reconsideration.Hence, the instant petition. The private respondents, as well as respondent labor arbiter, allege that the petitioner is not immune from suit and assuming that if, indeed, it is an international organization, it has, however, impliedly, if not expressly, waived its immunity by belatedly raising the issue of jurisdiction.

Issue: Whether SEAFDEC is an international agency enjoying diplomatic immunity?

Ruling: It is beyond question that petitioner SEAFDEC is an international agency enjoying diplomatic immunity. Furthermore, Section 2 of the same decree had provided for the autonomous character of SEAFDEC. Anent the issue of waiver of immunity, suffice it to say at the moment that the petitioner has timely raised the issue of jurisdiction. While the petitioner did not question the public respondent's lack of jurisdiction at the early stages of the proceedings, it, nevertheless, did so before it rested its case and certainly well before the proceedings thereat had terminated.55 Department GubantesDFA vs NLRCCases involving entities immune from suit

Private respondent initiated NLRC-NCR case for his alleged illegal dismissal by ADB and the latter's violation of the labor-only contracting law. ADB and the DFA notified respondent Labor Arbiter that the ADB, as well as its President and Office, were covered by an immunity from legal process. The LA took cognizance of the complaint on the impression that the ADB had waived its diplomatic immunity from suit and ruled in favor of the employee. ADB did not appeal the decision. DFA referred the matter to the NLRC and sought a formal vacation of the void judgment. NLRC ruled that the defense of immunity could have been raised before the LA by a special appearance, which may not be considered as a waiver of the very defense being raised. According to NLRC, any decision thereafter is subject to legal remedies, including appeals to the appropriate division of the Commission. They suggested that an appropriate complaint be lodged with Ombudsman if the DFA feels that the action of LA was misconduct.

ISSUE WON diplomatic immunity is extended to the ADB.

RULINGYes. Article 50(1) of the Charter provides that the Bank shall enjoy immunity from every form of legal process, except in cases arising out of or in connection with the exercise of its powers to borrow money, to guarantee obligations, or to buy and sell or underwrite the sale of securities. The stipulations of both the Charter and Headquarters Agreement should be able, may well enough, to establish that, except in the specified cases of borrowing and guarantee operations, as well as the purchase, sale and underwriting of securities, the ADB enjoys immunity from legal process of every form. The Bank's officers, on their part, enjoy immunity in respect of all acts performed by them in their official capacity. The Charter and the Headquarters Agreement granting these immunities and privileges are treaty covenants and commitments voluntarily assumed by the Philippine government which must be respected.56 Jusmag JimenezJUSMAG Philippines v. NLRCGR No. 108813, December 15, 1994 (cases involving entities immune from suit case- foreign government)




Facts:Private respondent was one of the seventy-four (74) security assistance support personnel(SASP) working at JUSMAG-Philippines. He had been with JUSMAG from December 18, 1969, until his dismissal on April 27, 1992. When dismissed, he held the position of Illustrator 2 and was the incumbent President of JUSMAG PHILIPPINES-FILIPINO CIVILIAN EMPLOYEES ASSOCIATION (JPFCEA), a labor organization duly registered with the Department of Labor and Employment. His services were terminated allegedly due to the abolition of his position. He was also advised that he was under administrative leave until April 27, 1992.

Private respondent filed a complaint with the Department of Labor and Employment on the ground that he was illegally suspended and dismissed from service by JUSMAG. He asked for his reinstatement.

JUSMAG then filed a Motion to Dismiss invoking its immunity from suitas an agency of the United States. It further alleged lack of employer-employee relationship and that it has no juridical personality to sue and be sued.

Labor Arbiter Daniel C. Cueto dismissed the subject complaint " for want of jurisdiction."Private respondent appealed to the National Labor Relations Commission (public respondent), assailing the ruling that petitioner is immune from suit for alleged violation of our labor laws. JUSMAG filed its Opposition, reiterating its immunity from suit for its non-contractual, governmental and/or public acts. NLRC reversed the ruling of the Labor Arbiter as it held that petitioner had lost its right not to be sued.

Issue:Whether JUSMAG Philippines is immune from suit

Ruling:Yes. A suit against JUSMAG id one against the US government, and in the absence of any waiver or consent from the latter to the suit, the complaint against JUSMAG cannot prosper. Immunity from suit is one of the universally recognized principles of international law that the Philippines recognizes and adopts the generally accepted principles of international law as part of the law of the land. As it stands now, the applictaion of the doctrine of immunity from suit has been restricted to sovereign ams governmental activities (jure imperi) and does not extend to commercial. Private and proprietary acts (jure gestionis)57 US v Hon Carpio

58 Ebro Carpio

59 Pacific JuradoPacific Consultant International, Asia, Inc. V. SchofeldGR 166920. Feb 19, 07Ponente. Callejo, Sr.

Facts. Respondent is a Canadian Citizen and was a resident of British Columbia, Canada. He had been a consultant in the field of environmenta, engineering. The petitioner was engaged in the business of providing specialty and technical services. Eventually, Schonfeld was hired as a Sector Manager for water and sanitation woth a condition that any questions regarding the conditions of mplyment between the employee and the company is to be settled by the Courtof Arbitration in London. Unfortunately, respondent was terminated for the reason that the company was not successful in the water and sanitation business. the respondent filed a complaint for illegal dismissal against the petitioner before the Labor Arbiter. petitioner contended that the venue was improperly laid under the conditions on employment, the parties had agreed that any employment related dispute be brought before the London Clurt of Arbitration.

Issue. whether the contetion of the petitioner is valid?

Held. No. The rule on stipulations regakrding the venue qre considered valid and enforceable, venue stipualtion in a contrqct do not supersede the general rule set forth in rule 4 of the rules of court in the absence of qualifying or restrictive words. they should be consijdered merely as an agreement or additonal forum, not as limitng venur to the specified place.60 Manila Otsuka



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)MANILA HOTEL CORP. VS. NLRC, G.R. NO. 120077, OCT. 13,2000PONENTE:PARDO.J.:PLACE:HONGKONG AND MANILA

In May 1988, Marcelo Santos was an overseas worker in Oman. In June 1988, he was recruited by Palace Hotel in Beijing, China. Due to higher pay and benefits, Santos agreed to the hotel’s job offer and so he started working there in November 1988. The employment contract between him and Palace Hotel was however without the intervention of the Philippine Overseas Employment Administration (POEA). In August 1989, Palace Hotel notified Santos that he will be laid off due to business reverses. In September 1989, he was officially terminated.

In February 1990, Santos filed a complaint for illegal dismissal against Manila Hotel Corporation (MHC) and Manila Hotel International, Ltd. (MHIL). The Palace Hotel was impleaded but no summons were served upon it. MHC is a government owned and controlled corporation. It owns 50% of MHIL, a foreign corporation (Hong Kong). MHIL manages the affair of the Palace Hotel. The labor arbiter who handled the case ruled in favor of Santos. The National Labor Relations Commission (NLRC) affirmed the labor arbiter.

ISSUE: Whether or not the NLRC has jurisdiction over the case.

HELD: No. The NLRC is a very inconvenient forum for the following reasons:

1. The only link that the Philippines has in this case is the fact that Santos is a Filipino;2. However, the Palace Hotel and MHIL are foreign corporations – MHC cannot be held liable because it merely owns 50% of MHIL, it has no direct business in the affairs of the Palace Hotel. The veil of corporate fiction can’t be pierced because it was not shown that MHC is directly managing the affairs of MHIL. Hence, they are separate entities3. Santos’ contract with the Palace Hotel was not entered into in the Philippines;4. Santos’ contract was entered into without the intervention of the POEA (had POEA intervened, NLRC still does not have jurisdiction because it will be the POEA which will hear the case);5. MHIL and the Palace Hotel are not doing business in the Philippines; their agents/officers are not residents of the Philippines;

Due to the foregoing, the NLRC cannot possibly determine all the relevant facts pertaining to the case. It is not competent to determine the facts because the acts complained of happened outside our jurisdiction. It cannot determine which law is applicable. And in case a judgment is rendered, it cannot be enforced against the Palace Hotel (in the first place, it was not served any summons).The Supreme Court emphasized that under the rule of forum non conveniens, a Philippine court or agency may assume jurisdiction over the case if it chooses to do so provided:

(1) that the Philippine court is one to which the parties may conveniently resort to;(2) that the Philippine court is in a position to make an intelligent decision as to the law and the facts; and(3) that the Philippine court has or is likely to have power to enforce its decision.None of the above conditions are apparent in the case at bar.61 Philippine PiedadPhilippine National Bank v. CabansagGR.no. 157010 June 21, 2005

Panganiban, J.:

Facts: Florence Cabansag arrived as atourist in Singapore. She applied for employment in the PNB Singapore Brance and was hired due to her credentials. Barely three months in the office, she was told by the assistant vice president and the general manager that they were told that they were asked to tell er that her resignation was procured from the bank due to cost cutting and the wanting of a Chinese speaking accountant and that te branch will be sold. She was warned that unless she pass a letter of resignation, her employment record will be marked dismissed. A complaint was filed with the Labor Arbiter and ruled in favor of Cabansag.

Issue: Whether or not the arbitration of the NLRC in the National Capital Region is the most convenient venue or forum to hear and decide the instant case.

Ruling: Yes. Sec. 1 (a) of the Rule IV of the NLRC Rules of Procedure reads that: “ All cases which the Labor Arbiter have authority to hear and decide may be filed in the Regional Arbitration Branch



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)(RAB) having jurisdiction over the workplace of petitioner.”

In cases of OFWs, the law has given the complainant a choice between his residence or the place of office of the employer. In this case, CAbansag returned to the Philippines in her residence in Filinvest, Quezon City. Thus, filing her complaint before the RAB ffice of the Quezon City is a valid choice.62 Austria RigorAUSTRIA VS. NLRCG.R. NO. 124382 AUGUST 16, 1999KAPUNAN, J.:

FACTS: Private respondent Central Philippine Union Mission Corporation of the Seventh Day Adventists (SDA) is a religious corporation under Philippine law and is represented by the other private respondents. Petitioner was a pastor of SDA until 1991, when his services were terminated.Austria worked with SDA for 28 years. He started as a literature evangelist in 1963 then got promoted several times. He became the Assistant Publishing Director in the West Visayan Mission of the SDA in 1968 and Pastor in the West Visayan Mission in 1972. Finally in 1989, he was promoted as District Pastor of the Negros Mission of the SDA.

On various occasions from August to October 1991, Austria received several communications from Mr. Ibesate, treasurer of the Negros Mission, asking the former to admit accountability and responsibility for the church tithes and offerings collected by his wife, Thelma Austria, in his district and to remit the same to the Negros Mission.

In his answer, petitioner said that he should not be made accountable since it was private respondent Pastor Buhat and Mr. Ibesate who authorized his wife to collect the tithes and offerings since he was very sick to do the collecting at that time. Thereafter, petitioner went to the office of Pastor Buhat, president of the Negros Mission, and asked for a convention to settle the dispute between petitioner and Pastor Rodrigo. Pastor Buhat denied the request of petitioner because there was no quorum. The two exchanged heated arguments until petitioner left the office. However, while on his way out, he heard Pastor Buhat saying, "Pastor daw inisog na ina iya (Pador you are talking tough)” which prompted him to go back and overturn Pastor Buhat’s table, scatter books in the office, bang Buhat’s attaché case and throw the phone.

Petitioner received a letter inviting him and his wife to attend the meeting to discuss the non-remittance of church collection and the events that transpired between him and Pastor Buhat. A fact-finding committee was created to investigate petitioner. Subsequently, petitioner received a letter of dismissal citing misappropriation of denominational funds, willful breach of trust, serious misconduct, gross and habitual neglect of duties, and commission of an offense against the person of employer's duly authorized representative, as grounds for the termination of his services.

1) Petitioner filed a complaint with the Labor Arbiter for illegal dismissal. = decision rendered in favor of petitioner2) SDA appealed to NLRC = decision rendered in favor of respondent3) Petitioner filed motion for reconsideration = reinstated decision of Labor Arbiter4) SDA filed motion for reconsideration = decision rendered in favor of respondent (grabe ang kulit!)Hence, this recourse.

ISSUE:1) WON the Labor Arbiter/NLRC has jurisdiction to try and decide the complaint filed by petitioner against the SDA;2) WON the termination of the services of petitioner is an ecclesiastical affair, and, as such, involves the separation of church and state;

RULING:1) YES.2) NO.

The principle of separation of church and state finds no application in this case. The rationale of the 36



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)principle of the separation of church and state is summed up in the familiar saying, "Strong fences make good-neighbors." The idea advocated by this principle is to delineate the boundaries between the two institutions and thus avoid encroachments by one against the other because of a misunderstanding of the limits of their respective exclusive jurisdictions.

Under the Labor Code, the provision which governs the dismissal of employees, is comprehensive enough to include religious corporations, such as the SDA, in its coverage. Article 278 of the Labor Code on post-employment states that “the provisions of this Title shall apply to all establishments or undertakings, whether for profit or not.” Obviously, the cited article does not make any exception in favor of a religious corporation. This is made more evident by the fact that the Rules Implementing the Labor Code, particularly, Section 1, Rule 1, Book VI on the Termination of Employment and Retirement.

With this clear mandate, the SDA cannot hide behind the mantle of protection of the doctrine of separation of church and state to avoid its responsibilities as an employer under the Labor Code.Finally, as correctly pointed out by petitioner, private respondents are estopped from raising the issue of lack of jurisdiction for the first time on appeal. It is already too late in the day for private respondents to question the jurisdiction of the NLRC and the Labor Arbiter since the SDA had fully participated in the trials and hearings of the case from start to finish. The case at bar does not concern an ecclesiastical or purely religious affair as to bar the State from taking cognizance of the same. An ecclesiastical affair is "one that concerns doctrine, creed, or form of worship of the church, or the adoption and enforcement within a religious association of needful laws and regulations for the government of the membership, and the power of excluding from such associations those deemed unworthy of membership. Examples of this so-called ecclesiastical affaits are proceedings for excommunication, ordinations of religious ministers, administration of sacraments and other activities with attached religious significance. The case at bar does not even remotely concern any of the given examples. What is involved here is the relationship of the church as an employer and the minister as an employee. It is purely secular and has no relation whatsoever with the practice of faith, worship or doctrines of the church. The matter of terminating an employee, which is purely secular in nature, is different from the ecclesiastical act of expelling a member from the religious congregation.

The issue being the legality of petitioner’s dismissal, the same must be measured against the requisites for a valid dismissal, namely: (a) the employee must be afforded due process, i.e., he must be given an opportunity to be heard and to defend himself, and; (b) the dismissal must be for a valid cause as provided in Article 282 of the Labor Code. Without the concurrence of this twin requirements, the termination would, in the eyes of the law, be illegal. This requirements are not present in this instant case at bar. Therefore, the dismissal was illegal. Petitioner is entitled to reinstatement to his former position without loss of seniority right and the payment of full backwages without any deduction corresponding to the period from his illegal dismissal up to actual reinstatement.63 De Castro Carpio

64 Aleman Carpio

65 Rubberworld ValeraRUBBERWORLD INC V NLRC

FACTS:Petitioner filed a petition for suspension of payments praying that it be declared in a state of suspension of payments and that the SEC accordingly issue an order restraining its creditors from enforcing their claims against petitioner corporation. The SEC favorably ruled the petition.Private respondents who claim to be employees of the petitioner filed against the latter for complaints of illegal dismissal, unfair labor practice, damages and payment of separation pay, retirement benefits, 13th month pay and service incentive pay.

Petitioners moved to suspend the proceedings by virtue of the SEC order but the LA denied the said motion holding that the said order did not include the suspension of proceedings involving claims against petitioner which have yet to be ascertained. Hence this petition.

ISSUE:Whether the NLRC acted in grave abuse of its discretion in affirming the order of LA denying the



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)motion to suspend proceeding despite the order of the SEC.

RULING:Yes. Labor claims included in suspension order.

Upon the creation of management committee or the appointment of a rehabilitation receiver, ALL claims for actions “shall be suspended accordingly”. No exception in favor of labor claims is mentioned in the law. Since the law makes no distinction, neither should the copurt.Allowing the labor cases to proceed clearly defeats the purpose of automatic stay and severely encumbers the management committee’s time and resources.66 Central AbadCase title – Central Pangasinan Electric Coop., Inc v. MacaraegGR number – 145800Date – 22 January 2003

Ponente - PUNO, J.:

Facts - Petitioner is an electric cooperative duly organized and existing under Philippine laws. Respondent Geronima Macaraeg and Maribeth de Vera are employees of petitioner. Sometime in January 1999, petitioner, through its Finance Department, noticed that several checks payable to petitioner from the collections in the Area V office were returned due to insufficiency of funds. Petitioner, through de Guzman, issued a memorandum to respondents placing them under preventive suspension and requiring them to explain in writing within forty-eight (48) hours why they misappropriated cooperative funds. This allegations were denied by the respondents.

On the basis of said findings and recommendation, the General Manager issued to respondents separate notices of termination for “serious misconduct, and breach of trust and confidence reposed on them by management.”

Respondents, with the help of the President and representative of the Union, , questioned their dismissal before the National Conciliation and Mediation Board (NCMB). They claimed that their dismissal was without just cause and in violation of the Collective Bargaining Agreement (CBA), which requires that the case should first be brought before a grievance committee. Eventually, the parties agreed to submit the case to a voluntary arbitrator for arbitration. Voluntary arbitrator rendered a decision in favor of respondents and held that there was a failure to comply with grievance procedure.

Issue – whether there was a violation of the CBA grievance procedure

Ruling - the first issue raised in the petition pertaining to the alleged violation of the CBA grievance procedure is moot and academic. The parties’ active participation in the voluntary arbitration proceedings, and their failure to insist that the case be remanded to the grievance machinery, shows a clear intention on their part to have the issue of respondents’ illegal dismissal directly resolved by the voluntary arbitrator. Thus, it was unnecessary to rule on the matter in light of their preference to bring the illegal dismissal dispute to voluntary arbitration without passing through the grievance machinery.

67 Perpetual AbellaPerpetual Help Credit Cooperative, Inc. v. MacaraegGR No. 121948, October 8, 2001Sandoval-Gutierrez, J.

Facts: Private respondents Faburada et al. filed a complaint against PHCCI for illegal dismissal, premium pay, separation pay, wage differential, moral damages and attorney’s fees. Petitioner PHCCI filed a motion to dismiss the complaint on the ground that there is no employer-employee relationship between them as private respondents are all members and co-owners of the cooperative. Furthermore, private respondents have not exhausted the remedies provided in the cooperative by-laws. Petitioner filed a supplemental motion to dismiss alleging that Article 121 of R.A. No. 6939, otherwise known as the Cooperative Development Authority Law which requires conciliation or mediation within the cooperative before a resort to judicial proceeding. The Labor Arbiter denied petitioner’s motion to dismiss, holding that the case is impressed with employer-employee relationship and that the law on cooperatives is subservient to the Labor Code. NLRC affirmed the same.




Issue: Whether respondent judge committed grave abuse of discretion in ruling that there is an employer-employee relationship between the parties and that private respondents were illegally dismissed.

Ruling: No. The SC supports the findings of the respondent court. In determining the existence of an employer-employee relationship, the following elements are considered: (1 ) the selection and engagement of the worker or the power to hire; (2) the power to dismiss; (3) the payment of wages by whatever means; and (4) the power to control the worker’s conduct, with the latter assuming primacy in the overall consideration. No particular form of proof is required to prove the existence of an employer-employee relationship. Any competent and relevant evidence may show the relationship.

The above elements are present in the case . Petitioner PHCCI, through Mr. Edilberto Lantaca, Jr., its Manager, hired private respondents to work for it. They worked regularly on regular working hours, were assigned specific duties, were paid regular wages and made to accomplish daily time records just like any other regular employee. They worked under the supervision of the cooperative manager. But unfortunately, they were dismissed. That an employer-employee exists between the parties is shown by the averments of private respondents in their respective affidavits. Article 121 of Republic Act No. 6938 (Cooperative Code of the Philippines) provides the procedure how cooperative disputes are to be resolved, thus: ART. 121. Settlement of Disputes. — Disputes among members, officers, directors, and committee members, and intra-cooperative disputes shall, as far as practicable, be settled amicably in accordance with the conciliation or mediation mechanisms embodied in the by-laws of the cooperative, and in applicable laws. Should such a conciliation/mediation proceeding fail, the matter shall be settled in a court of competent jurisdiction.

Complementing this Article is Section 8 of R.A. No. 6939 (Cooperative Development Authority Law) which reads: SEC. 8 Mediation and Conciliation. — Upon request of either or both parties, the Authority shall mediate and conciliate disputes within a cooperative or between cooperatives: Provided, That if no mediation or conciliation succeeds within three (3) months from request thereof, a certificate of non- resolution shall be issued by the Commission prior to the filing of appropriate action before the proper courts.

The above provisions apply to members, officers and directors of the cooperative involved in disputes within a cooperative or between cooperatives. There is no evidence that private respondents are members of petitioner PHCCI and even if they are, the dispute is about payment of wages, overtime pay, rest day and termination of employment. Under Art. 217 of the Labor Code, these disputes are within the original and exclusive jurisdiction of the Labor Arbiter.68 San Miguel BorlasG.R. No. 164257 July 5, 2010SAN MIGUEL CORPORATION, Petitioner, - versus - VICENTE B. SEMILLANO, NELSON MONDEJAR, JOVITO REMADA, ALILGILAN MULTI-PURPOSE COOP (AMPCO) AND MERLYN V. POLIDARIO, Respondents.

MENDOZA, J.:

Facts: AMPCO hired the services of Vicente et al, respondents herein, and were assigned to work in SMC’s Bottling Plant situated at Brgy. Granada Sta. Fe, Bacolod City, in order to perform the following tasks: segregating bottles, removing dirt therefrom, filing them in designated places, loading and unloading the bottles to and from the delivery trucks, and performing other tasks as may be ordered by SMC’s officers. They were required to work inside the premises of SMC using [SMC’s] equipment. Subsequently, SMC entered into a Contract of Services with AMPCO designating the latter as the employer of respondents. Later on, they were not allowed to enter the premises of SMC. AMPCO‘s project manager told them to wait for further instructions from the SMC’s supervisor, unfortunately, they never heard a word from SMC. They filed a COMPLAINT FOR ILLEGAL DISMISSAL with the Labor Arbiter against AMPCO and SMC and alleged that they



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)were regular employees as fillers of SMC Bottling Plant assigned to perform activities necessary and desirable in the usual business of SMC. On the other hand, SMC raised the defense that it is not the employer of the complainants and that AMPCO is their employer because the latter is an independent contractor. SMC assailed the jurisdiction of the Labor Arbiter and contended that the instant dispute is intra-cooperative in nature falling within the jurisdiction of the Arbitration Committee of the Cooperative Development Authority. LA ruled that respondents were regular employees of SMC and NLRC affirmed the same. SMC moved for reconsideration. NLRC reversed its earlier ruling and held AMPCO as employer of respondents because AMPCO was an independent contractor Since it had “substantial capital of nearly one (1) million” and had assumed the entire charge and control of respondents’ services. The CA, however, found that petitioner SMC wielded the power of control over respondent as they supervised respondents’ performance of loading and unloading of beer bottles and the power of dismissal as respondents were refused entry by SMC to its premises and were instructed by the AMPCO manager “to wait for further instructions from the SMC’s supervisor.” The CA added that AMPCO was a labor-only contractor since “a capital of nearly one million pesos” was insufficient.

Issue: Whether SMC or AMPCO is the employer of respondents?

Ruling: Findings of fact made by the Labor Arbiter and the NLRC, as the specialized agencies presumed to have the expertise on matters within their respective fields, are accorded much respect and even finality, when supported by ample evidence and affirmed by the CA. The fact that the NLRC, in its subsequent resolution, reversed its original decision does not render the foregoing inapplicable where the resolution itself is not supported by substantial evidence.

The test to determine the existence of independent contractorship is whether or not the one claiming to be an independent contractor has contracted to do the work according to his own methods and without being subject to the control of the employer, except only as to the results of the work.

The language of a contract is neither determinative nor conclusive of the relationship between the parties. Petitioner SMC and AMPCO cannot dictate, by a declaration in a contract, the character of AMPCO’s business, that is, whether as labor-only contractor, or job contractor.

The evidence is clear that respondents performed activities which were directly related to petitioner’s main line of business. Petitioner is primarily engaged in manufacturing and marketing of beer products and respondents’ work of segregating and cleaning bottles is unarguably an important part of its manufacturing and marketing process.

The law makes the principal responsible over the employees of the "labor-only" contractor as if the principal itself directly hired the employees.69 Tanjay GubantesTanjay Water vs Gabaton Issues involving local water utilities districts Jurisdiction

FACTSConsolidated case

1st case: Action for injunction with preliminary mandatory injunction and damages, against Municipality of Pamplona and its officials to prevent them from interfering in the management of the Tanjay Waterworks System. 2nd case: Labor case

Petitioner Josefino Datuin filed a complaint for illegal dismissal against respondent Tarlac Water District in the DOLE which decided in his favor. NLRC reversed the decision and dismissed the complaint for lack of jurisdiction, holding that as the respondent Tarlac Water District is a corporation created by a special law (PD No. 198), its officers and employees belong to the civil service and their separation from office should be governed by Civil Service Rules and Regulations.

ISSUEWON DOLE has jurisdiction over disputes in local water districts. RULING: No. Local water districts are quasi-public corporations whose employees belong to the civil service,



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)hence, the dismissal of those employees shall be governed by the civil service law, rules and regulations. Sec. 25 of PD 198 exempting the employees of water districts from the application of the Civil Service Law was removed from the statute books. The hiring and firing of employees of government-owned or controlled corporations are governed by the CS Law. Significantly, Article IX(B), Section 2(1) of the Constitution provides that civil service embraces all branches, subdivisions, instrumentalities and agencies of the government including government-owned corporations with original charters. Inasmuch as PD No. 198 as amended, is the original charter of the petitioner, they come under the coverage of the civil service law.70 Zamboanga JimenezZamboanga Water District vs. Buat GR No. 104389 ( issues involving local water utilities districts- exception)

FACTS: The Zamboanga City Water District, petitioner herein, is a government-owned and controlled corporation engaged in the business of supplying water in the City of Zamboanga. Private respondents are all employees of petitioner. A strike occurred in the company. It was conducted and participated in by private respondents, for which reason they were separated from their employment. Petitioner thereafter filed a complaint. before the Labor Arbiter to declare the said strike illegal. The following day the Zamboanga Utilities Labor Union (ZULU), to which private respondents belonged, filed before the Labor Arbiter, a complaint against petitioner for illegal dismissal and unpaid wages. The two cases were consolidated and heard together,a consolidated decision was rendered by the Executive Labor Arbiter declaring both the strike and the dismissal of private respondents illegal and ordering the reinstatement of private respondents to their former positions, without loss of seniority rights and privileges, but without back wages. Petitioner appealed to the NLRC. The NLRC, through respondent Commissioners, affirmed the decision of the Executive Labor Arbiter, with the sole modification that the strike leader, respondent Felix Laquio herein, be suspended from work without pay for a period of six months, effective ten days from receipt of the decision. Petitioner moved for a reconsideration, which the NLRC however denied. Petitioner contends that the NLRC had no jurisdiction to issue the resolutions in question because jurisdiction over labor disputes is vested in the Civil Service Commission. ISSUEWhether jurisdiction over the strike and dismissal of private respondents lodged with the NLRC

Ruling: No. There is no dispute that petitioner, a water district with an original charter, is a government-owned and controlled corporation. The established rule is that the hiring and firing of employees of government-owned and controlled corporations are governed by the provisions of the Civil Service Law and Civil Service Rules and Regulations. Jurisdiction over the strike and the dismissal of private respondents is therefore lodged not with the NLRC but with the Civil Service Commission. Petitioner never raised the issue of lack of jurisdiction before the Executive Labor Arbiter, the NLRC or even this. In fact, petitioner itself filed the complaint before the Executive Labor Arbiter in NLRC, sought affirmative relief therefrom and even participated actively in the proceedings below. It is only now in this case before us, after the NLRC ordered payment of back wages, that petitioner raises the issue of lack of jurisdiction. Indeed, it is not fair for a party who has voluntarily invoked the jurisdiction of a tribunal in a particular matter to secure an affirmative relief therefrom, to afterwards repudiate and deny that very same jurisdiction to escape a penalty. Petitioner is thus estopped from assailing the jurisdiction of the NLRC and is bound to respect all the proceedings below.71 Tolosa JuradoEVELYN TOLOSA v. NATIONAL LABOR RELATIONS COMMISSION, QWANA KAIUN (through its resident-agent, FUMIO NAKAGAWA), ASIA BULK TRANSPORT PHILS. INC., PEDRO GARATE and MARIO ASISG.R. No. 149578. April 10, 2003Ponente PANGANIBAN, J.:

Facts. Captian Tlosa was hired by Qwana Kaiun, through its manning agent, Asia Bulk Transport Phils., Inc., to be master of the Vessel named M/V Lady Dona. Capt Tolosa was in a good health condition. During the channeling activities, Capt. Tolosa was drenched with rainwater. The following day, he had a slight fever and in the succeeding twelve days, his health rapidly deteriorated resulting to his death. Evelyn Tolosa, wife of Capt. Tolosa, filed a complaint against Asia Bulk. However, NLRC vacated and dismissed the case on the ground of lack of jurisdiction over the subject matter.



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)Issue. Whether NLRC has jurisdiction over the case?

Ruling. None. The court held that the allegations in the complaint determine the nature of the action and the jurisdiction of courts. After carefully examining the complaint, the court was convinced that the allegations therein are in the nature of an action based on torts or quasi delicts. The court Regular Courts of Justice have jurisdiction over the actions for damages, in which EER is merely incidental and in which the cause of action proceeds from a different source of obligation such as torts.72 Banez OtsukaBANEZ VS. VALDEVILLATOPIC:CLAIMS OR COUNTER CLAIMSPONENTE: GONZAGA-REYES, J.:PLACE: ILIGAN CITY

FACTS: Petitioner Banez was the sales manager of private respondent in its branch in Iligan City. Banez was indefinitely suspended, thereafter Banez filed a complaint for illegal dismissal which the LA Nicodemus G. Palangan favored, the same with the appeal to the NLRC. On appeal, CA denied the motion for expiration of the reglementary period. Private respondents then filed a case with the RTC Misamis Oriental, to which the petitioner herein appeal for motion to dismiss on the grounds that the case arose from an employer-employee relationship was squarely under the exclusive jurisdiction of LA and NLRC under Art.217 (a) paragraph 4 of the Labor code.

ISSUE: Whether the LA has jurisdiction over the case

HELD: YES. The LA has jurisdiction over the case. Under Article 217 (a) paragraph 4 of the Labor Code:

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 decided within thirty (30) calendar days after the submission of case by the parties for decision without extension, even in the absence of stenographic notes, the following cases involving all workers, whether agricultural or non-agricultural;Xxx

4. Claims for actual, moral, exemplary and other forms of damages arising from the employer-employee relations:

Article 217 should apply with equal force to the claim of an employer for actual damages against its dismiss employee, where the basis for the claim arises from or is necessarily connected with the fact of termination and should be entered as a counterclaim with the illegal dismissal case.

Hence, the private respondent should have filed a counterclaim with the LA, however due to appeal of untimeliness the decision of the LA was deemed final and executor. The petitioner was granted and the case with the RTC was dismissed.73 Domondon PiedadDomondon v. NLRCGR.no. 154376 Sept. 30, 2005

Puno, J.:

Facts: Petitioner Domondon was hired as Materials Manager by the Van Melle Phils. All things went well until a precious general manager was replaced by a Dutch National- Have. Have requested that Domondon file his resignation letter. He refused and his life at work became difficult until he was removed from the company. He later filed for a complaint. In their counter complaint, the respondent denied Domondon’s allegations and even allowed him to resign. Respondent further averred the parties agreed that in order for him to own the car, he had an agreement with company that petitioner must pay for it in order to transfer ownership thereof. Subsequent demands were made but to no avail. When raised to the Labor Arbiter, the complaint by Domondon was denied.

Issue: Whether or not the Labor Arbiter has jurisdiction to hear the counterclaim of the employer and the return of the car for failure of Domondon to pay.

Ruling: Yes. The Labor Arbiter has jurisdiction.



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest) The Court holds that by the designating clause “ arising from employer= employee relationship” Article 217 should apply with equal force to the claim of an employer for actual damages against its employee where the basis of the claim arises from or necessarily connected with the fact of termination, and should be entered as a counterclaim in the illegal dismissal case.

Private respondent herein made a counterclaim involving the transfer of ownership of the company car to petitioner. Such transfer is connected with Domondon’s resignation and thus is covered in jurisdiction by the LaborArbiter.74 Philippine Rigor

75 Halaguena ValeraHALAGUENA V PAL

FACTS:Petitioners were employees as flight attendants of respondent PAL. They were members of Flight Attendants and Stewards Association of the Phils (FASAP). The petitioners manifested that the CBA provision on the compulsory retirement (female 55 y.o; male 60 y.o) was discriminatory. They filed a special civil action for declaratory relief with a prayer for the issueance of TRO and writ of preliminary injunction with the RTC. The RTC issued an order enjoining the respondent for implementing Sec 144 of the CBA.Respondents filed a petition for certiorari before the CA praying that the order of RTC be annulled and set aside for having issued without and/or grave abuse of discretion amounting to lack or excess of jurisdiction. The CA granted, declaring RTC to have no jurisdiction over the case. Hence this petition.

ISSUE:Whether the RTC has jurisdiction over petitioner’s action challenging the legality or constitutionality of the provisions on compulsory retirement age contained in the CBA between PAL and FASAP.

RULING:Yes. From the petitioner’s allegations and relief prayed for its clear that the issue raised is whether the Sec 144 part A of the PAL-FASAP CBA is unlawful and unconstitutional. Here, the petitoners’ primary relief is the annulment of the Sec 144 Part A which allegedly discriminates against them for being female flight attendants. The subject of the litigation is incapable of pecuniary estimation, exclusively cognizable by the RTC, pursuant to Sec 19 of BP 129, as amended. Being an ordinary action, the same is beyond the jurisdiction of labor tribunals. The said issue cannot be solved solely applying the LC. Rather, it requires the application of Constitution, labor statues, law on contracts and the convention on the elimination of all forms of discrimination against women, and the power to apply and interpret the constitution and CEDAW is within the jurisdiction of trial court, a court of general jurisdiction.76 Georg AbadCase title – Georg Grotjahn GMBH & Co. v. IsnaniGR number – 109272Date – 10 August 1994Ponente - PUNO, J

Facts - Petitioner is a multinational company organized and existing under the laws of the Federal Republic of Germany. Private respondent Lanchinebre was a sales representative of petitioner. Sometime on March 1992, she secured a loan from petitioner and made additional cash advances. Despite demand, private respondent Romana failed to settle her obligation with petitioner.

Private respondent Lanchinebre filed with the Arbitration Branch of the NLRC in Manila, a Complaint for illegal suspension, dismissal and non-payment of commissions against petitioner. On August 18, 1992, petitioner in turn filed against private respondent a Complaint for damages. Petitioner filed another Complaint for collection of sum of money against private respondents spouses Romana and Teofilo Lanchinebre. Instead of filing their Answer, private respondents moved to dismiss the Complaint and the same was granted.

Respondent judge issued the first impugned Order, granting the motion to dismiss. She held that the said cash advances were made pursuant to the employer-employee relationship between the (petitioner) and the said (private respondent) and as such, within the original and exclusive



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)jurisdiction of the National Labor Relations Commission.

Issue - WON THE TRIAL COURT GRAVELY ERRED IN HOLDING THAT THE REGULAR COURTS HAVE NO JURISDICTION OVER DISPUTES BETWEEN AN EMPLOYER AND AN EMPLOYEE INVOLVING THE APPLICATION PURELY OF THE GENERAL CIVIL LAW

Ruling - the trial court should not have held itself without jurisdiction over Civil Case No. 92-2486. It is true that the loan and cash advances sought to be recovered by petitioner were contracted by private respondent Romana Lanchinebre while she was still in the employ of petitioner. Nonetheless, it does not follow that Article 217 of the Labor Code covers their relationship. Not every dispute between an employer and employee involves matters that only labor arbiters and the NLRC can resolve in the exercise of their adjudicatory or quasi-judicial powers. The jurisdiction of labor arbiters and the NLRC under Article 217 of the Labor Code is limited to disputes arising from an employer-employee relationship which can only be resolved by reference to the Labor Code, other labor statutes, or their collective bargaining agreement.

An action for recovery of a sum of money brought by employer, as creditor, against an employee, as debtor, falls under the jurisdiction of regular courts.

Moreover, private respondents are estopped from assailing the personality of petitioner. “The rule is that a party is estopped to challenge the personality of a corporation after having acknowledged the same by entering into a contract with it. And the ‘doctrine of estoppel to deny corporate existence applies to foreign as well as to domestic corporations;’ ‘one who has dealt with a corporation of foreign origin as a corporate entity is estopped to deny its corporate existence and capacity.’ The principle ‘will be applied to prevent a person contracting with a foreign corporation from later taking advantage of its noncompliance with the statutes chiefly in cases where such person has received the benefits of the contract, x x x.”77 Santos AbellaSantos v. Servier Philippines, Inc.GR No. 166377, November 28, 2008Nachura, J.

Facts: Petitioner Ma. Isabel T. Santos, as the Human Resource Manager of Servier Philippines, attended a meeting of all human resource managers of respondent, held in Paris, France together with her family. During her stay in Paris, she was hospitalized due to "alimentary allergy," as she had recently ingested a meal of mussels which resulted in a concomitant uticarial eruption. All hospitalization expenses were paid by respondent. When she came back in the Philippines and underwent medical evaluation, the physician concluded that she had not fully recovered mentally and physically. This prompted respondent to terminate petitioner’s services. As a consequence thereof, respondent offered a retirement package. Of the promised retirement benefits amounting to P1,063,841.76, only P701,454.89 was released to petitioner’s husband, the balance thereof was withheld for taxation purposes. Petitioner then filed a case for unpaid balance of the retirement package. The LA dismissed the complaint. However, it refused to rule on the legality of the deductions made by respondent from petitioner’s total retirement benefits for taxation purposes, as the issue was beyond the jurisdiction of the NLRC. On appeal, NLRC set aside the ruling of LA. They emphasized that petitioner was not retired from the service; rather, she was dismissed from employment due to a disease/disability under Article 2842 of the Labor Code. In view of her non- entitlement to retirement benefits, the amounts received by petitioner should then be treated as her separation pay. CA affirmed the same.

Issue: Whether determination of legality of taxable benefits was beyond the labor tribunal’s jurisdiction.

Ruling: No. Contrary to the Labor Arbiter and NLRC’s conclusions, petitioner’s claim for illegal deduction falls within the tribunal’s jurisdiction. It is noteworthy that petitioner demanded the completion of her retirement benefits, including the amount withheld by respondent for taxation purposes. The issue of deduction for tax purposes is intertwined with the main issue of whether or not petitioner’s benefits have been fully given her. It is, therefore, a money claim arising from the employer-employee relationship, which clearly falls within the jurisdiction of the Labor Arbiter and the NLRC.

Section 32 (B) (6) (a) of the New National Internal Revenue Code (NIRC) provides for the exclusion of retirement benefits from gross income, thus for the retirement benefits to be exempt from the withholding tax, the taxpayer is burdened to prove the concurrence of the following elements: (1) a



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)reasonable private benefit plan is maintained by the employer; (2) the retiring official or employee has been in the service of the same employer for at least ten (10) years; (3) the retiring official or employee is not less than fifty (50) years of age at the time of his retirement; and (4) the benefit had been availed of only once.

Petitioner was qualified for disability retirement. At the time of such retirement, petitioner was only 41 years of age; and had been in the service for more or less eight (8) years. As such, the above provision is not applicable for failure to comply with the age and length of service requirements. Therefore, respondent cannot be faulted for deducting from petitioner’s total retirement benefits the amount of P362,386.87, for taxation purposes.78 Meralco BorlasG.R. No. 184769 October 5, 2010MANILA ELECTRIC COMPANY, ALEXANDER S. DEYTO and RUBEN A. SAPITULA, Petitioners, – versus – ROSARIO GOPEZ LIM, Respondent.

CARPIO MORALES, J.: Facts: Rosario G. Lim (respondent), a.k.a. Cherry Lim, is an administrative clerk at the Manila Electric Company (MERALCO). An anonymous letter was posted at the door of the Metering Office of the Administration building of MERALCO Plaridel, Bulacan Sector, at which respondent is assigned, denouncing respondent which reads:

“Cherry Lim:MATAPOS MONG LAMUNIN LAHAT NG BIYAYA NG MERALCO, NGAYON NAMAN AY GUSTO MONG PALAMON ANG BUONG KUMPANYA SA MGA BUWAYA NG GOBYERNO. KAPAL NG MUKHA MO, LUMAYAS KA RITO, WALANG UTANG NA LOOB….” Copies of the letter were also inserted in the lockers of MERALCO linesmen. Alexander Deyto, Head of MERALCO’s Human Resource Staffing, directed the transfer of respondent to MERALCO’s Alabang Sector in Muntinlupa as “A/F OTMS Clerk,” in light of the receipt of reports that there were accusations and threats directed against Lim from unknown individuals and which could possibly compromise Lim safety and security. she even suspects that her transfer to another place of work “betray[s] the real intent of management]” and could be a “punitive move hence requested for the deferment of the implementation of her transfer. No response to her request having been received, respondent filed a petition] for the issuance of a writ of habeas data and TRO against petitioners before the Regional Trial Court (RTC) of Bulacan. By respondent’s allegation, petitioners’ unlawful act and omission consisting of their continued failure and refusal to provide her with details or information about the alleged report which MERALCO purportedly received concerning threats to her safety and security amount to a violation of her right to privacy in life, liberty and security,correctible by habeas data. Petitioners moved for the dismissal of the petition because resort to a petition for writ of habeas data was not in order and the RTC lacked jurisdiction over the case which properly belongs to the National Labor Relations Commission (NLRC). RTC ruled in favor of respondent and justified that , recourse to a writ of habeas data should extend not only to victims of extra-legal killings and political activists but also to ordinary citizens, like respondent whose rights to life and security are jeopardized by petitioners’ refusal to provide her with information or data on the reported threats to her person. Hence this petition. Petitioners thus maintain that the RTC had no authority to restrain the implementation of the Memorandum transferring respondent’s place of work which is purely a management prerogative, and that OCA-Circular No. 79-2003[12] expressly prohibits the issuance of TROs or injunctive writs in labor-related cases.

Issue: Whether an employee may invoke the remedies available under writ of habeas data where an employer decides to transfer her workplace on the basis of copies of an anonymous letter posted therein?

Ruling: Respondent’s plea that she be spared from complying with MERALCO’s Memorandum directing her reassignment to the Alabang Sector, under the guise of a quest for information or data allegedly in possession of petitioners, does not fall within the province of a writ of habeas data. The habeas data rule, in general, is designed to protect by means of judicial complaint the image, privacy, honor, information, and freedom of information of an individual. It is meant to provide a forum to enforce one’s right to the truth and to informational privacy, thus safeguarding the constitutional guarantees of a person’s right to life, liberty and security against abuse in this age of information technology.



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)Respondent in fact trivializes these threats and accusations from unknown individuals as “highly suspicious, doubtful or are just mere jokes if they existed at all.”[18] And she even suspects that her transfer to another place of work “betray[s] the real intent of management]” and could be a “punitive move.” Her posture unwittingly concedes that the issue is labor-related.

The writs of amparo and habeas data will NOT issue to protect purely property or commercial concerns nor when the grounds invoked in support of the petitions therefor are vague or doubtful.[16] Employment constitutes a property right under the context of the due process clause of the Constitution.[17] It is evident that respondent’s reservations on the real reasons for her transfer - a legitimate concern respecting the terms and conditions of one’s employment - are what prompted her to adopt the extraordinary remedy of habeas data. Jurisdiction over such concerns is inarguably lodged by law with the NLRC and the Labor Arbiters.79 Halaguena GubantesHalaguena vs PALRTC Jurisdiction CBA: Reasonable Causal Connection Rule

Petitioners were employed as female flight attendants of PAL on different dates prior to November 22, 1996. They are members of of the Flight Attendants and Stewards Association of the Philippines, a labor organization certified as the sole and exclusive bargaining representative of the flight attendants/stewards and pursers of respondent. PAL and FASAP entered into a CBA incorporating the terms and conditions of their agreement for the years 2000 to 2005. Petitioners and several female cabin crews manifested that the CBA provision on compulsory retirement at the age of 55 for females is discriminatory, and demanded for an equal treatment with their male counterparts. Petitioners filed a Special Civil Action for Declaratory Relief with Prayer for the Issuance of Temporary Restraining Order and Writ of Preliminary Injunction with the RTC. The RTC upheld its jurisdiction over the case claiming that the thrust of the Petition is Sec. 144 of the CBA which is allegedly discriminatory. The allegation in the Petition do not make out a labor dispute arising from EE relationship as none is shown to exist. This case is not directed specifically against respondent arising from any act of the latter, nor does it involve a claim against the respondent. CA ruled that the RTC has no jurisdiction over the case.

ISSUEWON the RTC has jurisdiction over the petitioners' action challenging the legality of the provisions of the CBA.

RULINGYes. The petitioners' allegations and relief prayed for in its petition, it is clear that the issue raised is whether the abovementioned provision is unlawful and unconstitutional. The subject of litigation is incapable of pecuniary estimation, exclusively cognizable by the RTC. Being an ordinary civil action, the same is beyond the jurisdiction of labor tribunals. The said issue cannot be resolved solely by applying the Labor Code. Not every controversy or money claim by an employee against the employer or vice-versa is within the exclusive jurisdiction of the labor arbiter. Actions between employees and employer where the EE relationship is merely incidental and the cause of action precedes from a different source of obligation is within the exclusive jurisdiction of the regular court just like in this case. Grievance machinery and voluntary arbitrators do not have the power to determine and settle the issues at hand. They have no competence to decide constitutional issues relative to the questioned compulsory retirement age. Although the CBA provides for a procedure for the adjustment of grievances, such referral to the grievance machinery and voluntary arbitration would be inappropriate to the petitioners, because the union and the management have unanimously agreed to the terms of the CBA and their interest is unified.80 Sonza JimenezSonza v. ABS CBN GR No. 135081June 10, 2004 (independent contractor- money claims)

FACTS:In May 1994, ABS-CBN signed an agreement with the Mel and JayManagement and Development Corporation (MJMDC). ABS-CBN wasrepresented by its corporate officers while MJMDC was represented by Sonza,as President and general manager, and Tiangco as its EVP and treasurer.Referred to in the agreement as agent, MJMDC agreed to provide Sonza’sservices exclusively to ABS-CBN as talent for radio and television. ABS-CBNagreed to pay Sonza a monthly talent fee of P310, 000 for the first year andP317, 000 for the second and third year.On April 1996, Sonza wrote a letter to ABS-CBN's President, Eugenio Lopez III,where he irrevocably resigned in view of the recent events concerning hisprogram and career. The acts of the station are violative of the Agreementand said letter will serve as notice of rescission of said contract. The letteralso



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)contained the waiver and renunciation for recovery of the remainingamount stipulated but reserves the right to seek recovery of the otherbenefits under said Agreement.After the said letter, Sonza filed with the Department of Labor and Employment a complaint alleging that ABS-CBN did not pay his salaries,separation pay, service incentive pay,13th month pay, signing bonus, travelallowance and amounts under the Employees Stock Option Plan (ESOP). ABS-CBN contended that no employee-employer relationship existed between theparties. However, ABS-CBN continued to remit Sonza’s monthly talent feesbut opened another account for the same purpose. The Labor Arbiter dismissed the complaint and found that there is noemployee-employer relationship. The LA ruled that he is not an employee byreason of his peculiar skill and talent as a TV host and a radio broadcaster.Unlike an ordinary employee, he was free to perform his services inaccordance with his own style. NLRC and CA affirmed the LA. Should there beany complaint, it does not arise from an employer-employee relationship butfrom a breach of contract.

Issue:Whether Sonza’s money claims be cognizablae by NLRC

NO. SONZA’s claims are all based on the May 1994 Agreement and stock option plan, and not on the Labor Code. Clearly, the present case does not call for an application of the Labor Code provisions but an interpretation and implementation of the May 1994 Agreement. In effect, SONZA’s cause of action is for breach of contract which is intrinsically a civil dispute cognizable by the regular courts.81 Consulta JuradoRAQUEL P. CONSULTA, v. COURT OF APPEALS, PAMANA PHILIPPINES, INC., RAZUL Z. REQUESTO, and ALETA TOLENTINOG.R. No. 145443. March 18, 2005Ponente. CARPIO, J.:

Facts. Private respondent, PAMANA, was engaged in health care business. Consulta was a managing associate of PAMANA with an agreement of a non-EER basis. Consulta negotiated, in behalf of PANAMA, with the Federation of Filipino Civilian Employees Association (FFCEA) covering its members under the PAMANA health care plans. Eventually, PAMANA and U.S Naval Supply Depot signed the FFCEA account. Consulta claimed that PAMANA did not pay her commission for the FFCEA account and filed a complaint for unpaid wages before the LA. LA ordered to pay Consulta which was affirmed by NLRC. On appeal, the decision of the NLRC was reversed by the CA on the ground that there is no EER and Consulta was a commission agent.

Issue. Whether LA has jurisdiction over Consulta’s money claims?

Ruling. None the court applied the four fold test (power to hire; payment of wages; power to dismiss; power to control), wherein the power to control is the most important.

In the present case, the power to control is missing. Consulta’s action was not subject to the control of PAMANA. Consulta failed to show that she had to report for work at definite hours. The amount of time she devoted was left entirely to her discretion. The means and methods of performing her job were left to her judgment. It was established that Consulta only received suggestions from PAMANA regarding the sales. Hence, there is no EER between parties. The LA and NLRC have no jurisdiction on Consulta’s money claims.82 Banez Otsuka

83 Pepsi PiedadPepsi Cola v. GalangGR.no. 89621 Sept. 24, 1991

Cruz, J.:

Facts: Private respondents were employees of the petitioner who were suspected of complicity in the irregular disposition of empty bottles of Pepsi Cola.Petitioners filed a criminal complaint against this employees but was later withdrawn and substituted with the criminal complaint of falsification of private documents. After a preliminary investigation was conducted, it was dismissed. After the Administrative investigation, the respondents were dismissed by the petitioner. Aggrieved, respondents filed a civil complaint for malicious proseuion in the RTC of TAnauan, Leyte. Petitioner cried lack of jurisdiction by the Trial Court.



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)Issue: Whether or not the Trial court has jurisdiction of the civil complaint.

Ruling: Yes. It must be stressed that not every controversy involving workers and their employers can be resolved only by the Labor Arbiter.

This will be so only if there is a “reasonable causal connection” between the claim asserted and the employee- employer relations to put the case under the provision of Article 217. Absent such a link, the complaint will be cognizable by the regular courts of justice in the exercise of their civil and criminal jurisdiction.

The case now before the court involves a complaint for damages for malicious prosecution which was filed with the RTC of Leyte by the employees of the defendant. It does not appear that there is a reasonable causal connection between the complaint and the employer- employee relationship that will warrant the jurisdiction of the Labor Arbiter.84 Bright Maritime Carpio

85 Pioneer

86 Garcia RigorGARCIA VS. PAL

G.R. NO. 164856 JANUARY 20, 2009CARPIO MORALES, J.:

FACTS:

This case stemmed from an administrative charge filed by PAL against employees, herein petitioners after allegedly being caught in the act of sniffing shabu in the workplace. After due notice, PAL dismissed petitioners prompting the latter to file a complaint for illegal dismissal which was resolved by the Labor Arbiter in their favor ordering inter alia their reinstatement. Subsequently, respondent company was placed under corporate rehabilitation. From the Labor Arbiter, respondent appealed to NLRC which reversed said decision. Later, a writ of execution as regards the reinstatement was issued by the Labor Arbiter. Respondent then filed an urgent petition for injunction on the ground that it cannot comply with the reinstatement order due to its corporate rehabilitation.

ISSUE:

1. Whether a subsequent finding of a valid dismissal by NLRC removes the basis for implementing the reinstatement aspect of the Labor Arbiter’s decision?

2. Whether respondent company is justified in refusing to comply with such reinstatement order in view of its corporate rehabilitation?

RULING:

1) NO.2) NO

On the first issue, jurisprudential trend has maintained that even if the order of reinstatement of the Labor Arbiter is reversed on appeal, it is obligatory on the part of the employer to reinstate and pay the wages of the dismissed employee during the period of appeal until reversal by the higher court. The employee is not required to reimburse whatever salary he may have received for he is entitled to such. The opposite view is articulated in Genuino vs NLRC which states:

“If the decision of the Labor Arbiter is later reversed on appeal upon the finding that the ground for dismissal is valid, then the employer has the right to require the dismissed employee on payroll reinstatement to refund the salaries he or she received while the case was pending appeal, xxx.

Considering that Genuino was not reinstated to work or placed on payroll reinstatement, and her dismissal is based on a just cause, then she is not entitled to be paid the salaries xxx.”



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)However, the dearth of authority supporting Genuino renders inutile the rationale of reinstatement pending appeal. Pursuant to police power, the State may authorize an immediate implementation, pending appeal of a decision reinstating a dismissed or separated employee since that saving act is designed to stop, although temporarily since the appeal may be decided in favor of the appellant, a continuing threat or danger to the survival or even the life of the dismissed or separated employee and his family. Thus, the “Refund Doctrine” easily demonstrates how a favorable decision by the Labor Arbiter could harm more than help a dismissed employee. The employee, to make both ends meet, would necessarily have to use up the salaries received during the pendency of the appeal, only to end up having to refund the sum in case of a final unfavorable decision. The provision of Art. 223 is clear that an award by the Labor Arbiter for reinstatement shall be immediately executory even pending appeal and the posting of a bond by the employer shall not stay the execution for reinstatement. The legislative intent is quite obvious i.e. to make an award of reinstatement immediately enforceable, even pending appeal. The Court reaffirms such prevailing principle that even if the order of reinstatement is reversed on appeal, it is obligatory on the part of the employer to reinstate and pay the wages of the dismissed employee during the period of appeal until reversal by the higher court.

After the labor arbiter’s decision is reversed by a higher court, the employee may be barred from collecting the accrued wages if it is shown that the delay in enforcing the reinstatement was without fault of the employer. The test is two-fold: a) there must be actual delay or the fact that the order of reinstatement pending appeal was not executed prior to its reversal and b) the delay must not be due to the employer’s unjustified act or omission. If the delay is due to employer’s unjustified refusal, the employer may still be required to pay the salaries notwithstanding the reversal of the labor arbiter’s decision. In Genuino, the former NLRC Rules of Procedure was still applied in which it did not lay down a mechanism to promptly effectuate the self-executory order of reinstatement, making it difficult to establish that the employer actually refused to comply. The new NLRC Rules of Procedure which took effect on Jan. 7, 2006 now require the employer to submit a report of compliance within 10 calendar days from receipt of the labor arbiter’s decision. The employee need not file a motion for the issuance of a writ of execution since the labor arbiter shall thereafter motu proprio issues the writ. It is settled that upon appointment by SEC of a rehabilitation receiver, all actions for claims before any tribunal against the corporation shall ipso jure be suspended. Case law recognizes that unless there is a restraining order, the implementation of the order of reinstatement is ministerial and mandatory. The suspension of claims partakes of the nature of a restraining order that constitutes legal justification for respondent’s non-compliance with the reinstatement order. Respondent’s failure to exercise the alternative options of actual reinstatement and payroll reinstatement was thus justified. The petition is denied. The CA decision annulling the NLRC resolutions affirming the validity of the Writ of Execution and Notice of Garnishment is affirmed.87 Pfizer ValeraPFIZER V VELASCO

FACTS:Velasco was employed by Pfizer as professional health care representative. Due to her pregnancy, she was advised bed rest which resulted to her leave of absence. While on leave, she was advised upon the investigation of her possible company violations. On the 2nd and 3rd show cause notice she refused to answer and later she was advised that the petitioner already terminated her services. Velasco filed a complaint before the LA which declared the dismissal illegal ordering her reinstatement with backwages further awarding moral and exemplary damages plus atty’s fees. The petitioner appealed to the NLRC but was denied and deleted the respondent’s award for damages. Petitioner then filed with the CA a special civil action for issuance of writ of certiorari under rule 65. CA upheld the validity of respondent’s dismissal. CA later modified its earlier decision ordering Pfizer to pay respondent her wages from the date of LA’s decision up to CA’s decision. Pfizer contend that there was no unjustified refusal on its part because It was respondent who refused to return to work. Hence this petition.

ISSUE:

RULING:The petition is without merit. Under Art 223 of the LC, an employee entitled to reinstatement “shall either be entitled back to work under the same terms and conditions prevailing prior to his dismissal or separation or at the option of the employer, merely reinstated in the payroll.” It is established in jurisprudence that reinstatement means restoration to a state or condition from which had been removed or separated. The person reinstated assumes the position he had



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)occupied. In the present case, the petitioner did not comply with the rule on reinstatement, “under the same terms and conditions” because they sent a letter informing respondent of her transfer of work assignment form Baguio City to Makati City.88 Aboc AbadCase title – Aboc v. MetrobankGR number – 170542-43Date – 13 December 2010Ponente - MENDOZA, J

Facts - These two cases stemmed from a complaint for illegal dismissal and damages filed by Aboc against Metrobank. Aboc, the Regional Operations Coordinator of Metrobank in Cebu City alleged that he received an inter-office letter, requiring him to explain in writing the charges that he had actively participated in the lending activities of his immediate supervisor, Chua the Branch Manager of Metrobank where he was assigned. Metrobank, on the other hand, replied that, Chua, Judith Eva Cabrido (assistant manager), Arthur Arcepi (accountant), and Aboc organized a credit union known as Cebu North Road Investment (CNRI). Said officers and employees used Metrobank’s premises, equipment and facilities in their lending business.

Metrobank then required Aboc to submit a written explanation why he should not be dismissed for cause and attend a conference in which he was allowed to bring a counsel of his own choice.

Thereafter, Metrobank found that Aboc’s actions constituted serious misconduct and a breach of trust and confidence. Metrobank then terminated his services.

LA rendered her decision, finding that Aboc was illegally dismissed from the service by Metrobank. Consequently, Metrobank was ordered to reinstate complainant Aboc to his former position or to a substantially equivalent position without loss of seniority rights and other privileges, and to pay said complainant.

NLRC set aside the decision of the LA but ordered Metrobank to pay Aboc reinstatement wages. Aggrieved, Metrobank challenged the grant of monetary award in a petition before the CA to which the latter affirmed decision of the NLRC.

Issue - Whether or not the Court of Appeals erred in ruling that the Metrobank was liable to pay the monetary award claimed by Aboc.

Ruling - The monetary award granted to Aboc was warranted under the law and jurisprudence. In the case at bench, it cannot be denied that Metrobank opted to reinstate Aboc in its payroll. Since Metrobank chose payroll reinstatement for Aboc, the Court agrees with the CA that he then became a reinstated regular employee. This means that he was restored to his previous position as a regular employee without loss of seniority rights and other privileges appurtenant thereto. His payroll reinstatement put him on equal footing with the other regular Metrobank employees insofar as entitlement to the benefits given under the Collective Bargaining Agreement is concerned.

The fact that the decision of the LA was reversed on appeal has no controlling significance. The rule is that even if the order of reinstatement of the LA is reversed on appeal, it is obligatory on the part of the employer to reinstate and pay the wages of the dismissed employee during the period of appeal until final reversal by the higher court.

89 Lansangan AbellaLansangan v. Amkor Technology Phils.GR No. 177026, January 30, 2009Carpio-Morales, J.

Facts: An anonymous e-mail was sent to the General Manager of Amkor Technology Philippines detailing allegations of malfeasance on the part of its supervisory employees Lunesa Lansangan and Rosita Cendaña for "stealing company time." Respondent thus investigated the matter, requiring petitioners to submit their written explanation. Petitioners admitted their wrongdoing. Respondent thereupon terminated petitioners for "extremely serious offenses" as defined in its Code of Discipline, prompting petitioners to file a complaint for illegal dismissal against it. The labor arbiter Arthur L. Amansec dismissed petitioners’ complaint, he having found them guilty of



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)swiping another employees’ I.D. card or requesting another employee to swipe one’s I.D. card to gain personal advantage and in the interest of cheating, an offense of dishonesty punishable as a serious form of misconduct and fraud or breach of trust under Article 282 of the Labor Code, which allows the dismissal of an employee for a valid cause.

The Arbiter, however, ordered the reinstatement of petitioners to their former positions without backwages "as a measure of equitable and compassionate relief". On appeal, the NLRC grantedRespondent’s appeal by deleting the reinstatement aspect of the Arbiter’s decision. CA while affirming the finding that petitioners were guilty of misconduct and the like, ordered respondent to pay petitioners their corresponding backwages without qualification and deduction for the period covering October 20, 2004 (date of the Arbiter’s decision) up to June 30, 2005 (date of the NLRC Decision) citing Article 223 of the Labor Code and Roquero v. PAL.

Issue: Whether petitioner is entitled to backwages under Ativle 223 of the Labor Code.

Ruling: No. Roquero, as well as Article 223 of the Labor Code on which the appellate court also relied, finds no application in the present case. Article 223 concerns itself with an interim relief, granted to a dismissed or separated employee while the case for illegal dismissal is pending appeal, as what happened in Roquero. It does not apply where there is no finding of illegal dismissal, as in the present case. The Arbiter found petitioners’ dismissal to be valid. Such finding had, as stated earlier, become final, petitioners not having appealed it.

Following Article 279 which provides: In cases of regular employment, the employer shall not terminate the services of an employee except for a just cause or when authorized by this Title. An employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages, inclusive of allowances, and to his other benefits or their monetary equivalent computed from the time his compensation was withheld from him up to the time of his actual reinstatement petitioners are not entitled to full backwages as their dismissal was not found to be illegal. Agabon v. NLRC so states, payment of backwages and other benefits is justified only if the employee was unjustly dismissed.

90 Alcantara BorlasG.R. No. 155109/G.R. No. 155135/G.R. No. 179220, September 29, 2010C. Alcantara & Sons, Inc. vs. Court of Appeals / Nagkahiusang Mamumuno sa Alsons-SPFL (NAMAAL-SPFL), et al. vs. C. Alcantara & Sons, Inc., et al. / Nagkahiusang Mamumuno sa Alsons-SPFL (NAMAAL-SPFL), et al. vs. C. Alcantara & Sons, Inc., et al.,

ABAD, J.:

Facts: C. Alcantara & Sons, Inc., (the Company) is a domestic corporation engaged in the manufacture and processing of plywood. Nagkahiusang Mamumuo sa Alsons-SPFL (the Union) is the exclusive bargaining agent of the Company’s rank and file employees. The other parties to these cases are the Union officers and their striking members. The Company and the Union filed a notice of strike when their negotiation regarding the economic provisions of their CBA ended in a deadlock. The Union went on strike and the Company filed a petition for the issuance of a writ of preliminary injunction with NLRC to enjoin the strikers from intimidating, threatening, molesting, and impeding by barricade the entry of non-striking employees at the Company’s premises. The NLRC granted said petition. But several attempts to implement the writ failed. Meanwhile the Union filed a petition with the Court of Appeals (CA), questioning the preliminary injunction order. It was dismissed and the Union did not appeal. The Company, on the other hand, filed a petition with the Regional Arbitration Board to declare the Union’s strike illegal for violating the no strike provision of their CBA. The Labor Arbiter ruled that Union’s strike illegal and held that the Union officers should be deemed to have forfeited their employment. With respect to the striking Union members, Labor Arbiter ordered their reinstatement without backwages. The Company did not reinstate them. Both parties appealed wherein the company impugned the order of the reinstatement and the union questioned the illegality of the strike as well as the dismissal of its officers. NLRC affirmed the said decision however held that the Union members involved, who were identified in the proceedings held in the



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)case, should also be terminated for having committed prohibited and illegal acts. The CA annulled the NLRC decision and reinstated that of the Labor Arbiter. The Company and the Union with its officers and members filed separate petitions for review of the CA decision. The affected Union members filed with the Labor Arbiter a motion for reinstatement pending appeal by the parties and the computation of their backwages based on the CA decision. The Labor Arbiter held that the impracticability of reinstatement owing to the fact that the relations between the terminated Union members and the Company had been severely strained by the prolonged litigation, payment of separation pay to such Union members was in order. Both parties appealed the Labor Arbiter’s resolution to the NLRC. NLRC declared the Labor Arbiter’s resolution void and ordered the Company to pay the affected employees’ accrued wages and 13th month pay considering the Company’s refusal to reinstate them pending appeal. On motion for reconsideration by both parties, NLRC issued a resolution deleting the grant of accrued wages and 13th month pay to the subject employees. Upon the Union’s petition for certiorari] with the CA, they questioned the NLRC’s denial of the terminated Union members’ claim for separation pay, accrued wages, and other benefits. The CA ruled that the reinstatement pending appeal provided under Article 223 of the Labor Code contemplated illegal dismissal or termination cases and not cases under Article 263. Thus, the CA ruled that the resolution ordering the reinstatement of the terminated Union members and the payment of their wages and other benefits had no basis. Aggrieved, the Union sought intervention by this Court. Issue: Whether the LA’s order of reinstatement is immediately executory? Whether the company is liable to Pay backwages?

Ruling: The CA denied reinstatement for the reason that the reinstatement pending appeal provided under Article 223 of the Labor Code contemplated illegal dismissal or termination cases and not cases under Article 264. But this perceived distinction does not find support in the provisions of the Labor Code. The grounds for termination under Article 264 are based on prohibited acts that employees could commit during a strike. On the other hand, the grounds for termination under Articles 282 to 284 are based on the employee’s conduct in connection with his assigned work. Still, Article 217, which defines the powers of Labor Arbiters, vests in the latter jurisdiction over all termination cases, whatever be the grounds given for the termination of employment. Consequently, Article 223, which provides that the decision of the Labor Arbiter reinstating a dismissed employee shall immediately be executory pending appeal, cannot but apply to all terminations irrespective of the grounds on which they are based.

Here, although the Labor Arbiter failed to act on the terminated Union members’ motion for reinstatement pending appeal, the Company had the duty under Article 223 to immediately reinstate the affected employees even if it intended to appeal from the decision ordaining such reinstatement. The Company’s failure to do so makes it liable for accrued backwages until the eventual reversal of the order of reinstatement by the NLRC, a period of four months and nine days.91 Garza Flores

92 Millenium GubantesMillenium Erectors Corporation vs MagallanesRequirements to perfect appeal to NLRC

FACTSVirgilio Magallanes started working in 1988 as a utility man for Laurencito Tiu, Chief Executive Officer of Millennium Erectors Corporation. He was assigned to different construction projects undertaken by petitioner in Metro Manila, the last of which was for a building in Libis, Quezon City. In July of 2004, he was told not to report for work anymore allegedly due to old age, prompting him to file an illegal dismissal complaint before the LA. The LA rule in favor of the petitioner and dismissed the complaint, holding that respondent knew of the nature of his employment as a project employee. NLRC set aside LA's decision holding that respondent was a regular employee. Petitioner moved for reconsideration of the NLRC decision, contending that respondent's motion for reconsideration which it treated as an appeal was not perfected, it having been belatedly filed;



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)that there was no statement of the date of receipt of the appealed decision; and that it lacked verificatio of copies thereof were not furnished the adverse parties. CA affirmed NLRC's decision

ISSUEWON NLRC erred in treating respondent's motion for reconsideration as an appeal.

RULINGNo. In labor cases, rules of procedure should not be applied in a very rigid and technical sense. They are merely tools designed to facilitate the attainment of justice, and where their strict application would result in the frustration rather than promotion of substantial justice, technicalities must be avoided. Where the ends of substantial justice shall be better served, the application of technical rules of procedure may be relaxed. The requirement regarding verification of a pleading is formal, not jurisdictional. Such requirement is simply a condition affecting the form of pleading, the non-compliance of which does not necessarily render the pleading fatally defective. As for the requirement on proof of service, it may also be dispensed with since in appeals in labor cases, non-service of copy of the appeal or appeal memorandum to the adverse party is not a jurisdictional defect which calls for the dismissal of the appeal.93 New Pacific JimenezNew Pacific Timber and Supply Co. vs. NLRCGR No. 124224, March 17, 2000 (petition for relief treated as appeal)

Facts:The NFL was the sole and exclusive bargaining representative for the rank and file employees of petitioner. NFL started to negotiate for better terms and conditions of employment; which were met with resistance by Petitioner Company. The NFL filed a complaint for ULP on the ground of refusal to bargain collectively. LA issued an order declaring the company guilty of ULP and ordering the CBA proposals submitted by the NFL as the CBA between parties. Later, 186 of private respondents claiming they were wrongfully excluded from the benefits under the CBA filed a petition for relief. Petitioner asserts that private respondents are not parties to the agreement and may not claim benefits thereunder. As for the CBA, petitioner maintains that the force and effect of the CBA’s terms are limited to only three years and cannot extend to terms and conditions which ceased to have force and effect.

Issue:Whether NLRC committed grave abuse of discretion when it entertained the petition for relief filed by the private respondents and treated it as an appeal, even if it was filed beyond the relementary period for filing an appeal

Ruling:No. We find no grave abuse of discretion on the part of the NLRC, when it entertained the petition for relief filed by the private respondents and treated it as an appeal. even if it was filed beyond the reglementary period for filing an appeal. Ordinarily, once a judgment has become final and executory, it can no longer be disturbed, altered or modified. However, a careful scrutiny of the facts and circumstances of the instant case warrants liberality in the application of technical rules and procedure. It would be a greater injustice to deprive the concerned employees of the monetary benefits rightly due them because of a circumstance over which they had no control. The Supreme Court has allowed appeals from decisions of the labor arbiter to the NLRC, even if filed beyond the reglementary period, in the interest of justice. Moreover, under Article 218 (c) of the Labor Code, the NLRC may, in the exercise of its appellate powers, "correct, amend or waive any error, defect or irregularity whether in substance or in form." Further, Article 221 of the same provides that: "In any proceeding before the Commission or any of the Labor Arbiters, the rules of evidence prevailing in courts of law or equity shall not be controlling and it is the spirit and intention of this Code that the Commission and its members and the Labor Arbiters shall use every and all reasonable means to ascertain the facts in each case speedily and objectively and without regard to technicalities of law or procedure, all in the interest of due process.

94 Auza Carpio

95 Opinaldo Carpio

96 New Pacific Timber Carpio

97 Saint Louis Cobarrubias Flores53




98 SAntos Flores

99 Semblante and Pilar Flores

100 Intertanz Flores

101 Maynilad Flores

102 Sapitan Flores

103 Andrew JuradoANDREW JAMES MCBURNIE V. EULALIO GANZON, EGI-MANAGERS, INC. and E. GANZON, INC.G.R. Nos. 178034 & 178117 G R. Nos. 186984-85 October 17, 2013Ponente. REYES, J

Facts: McBurnie, an Australian national, signed a five-year employment agreement5 with the company EGI as an Executive Vice-President who shall oversee the management of the company’s hotels and resorts within the Philippines. When he figured in an accident that compelled him to go back to Australia while recuperating from his injuries. While in Australia, he was informed by respondent Ganzon that his services were no longer needed because their intended project would no longer push through. He instituted a complaint for illegal dismissal and other monetary claims against the respondents. The respondents opposed and contended that their agreement was to jointly invest in and establish a company for the management of hotels. They did not intend to create an employer-employee relationship, and the execution of the employment contract that was being invoked by McBurnie was solely for the purpose of allowing McBurnie to obtain an alien work permit in the Philippines. The LA declared McBurnie as having been illegally dismissed from employment. The respondents appealed the LA’s Decision to the NLRC. They filed Motion to Reduce Bond, and posted an appeal bond in the amount of P100,000.00 and contended that the monetary awards of the LA were null and excessive, allegedly with the intention of rendering them incapable of posting the necessary appeal bond considering petitioner is a single foreigner who had no work permit and who left the country for good one month after the purported commencement of his employment" was a patent nullity and respondents lacked the capacity to pay the bond of almost P60 Million due to business losses. The said motion was denied as well as their motion for reconsideration. Petition for certiorari was filed and CA ruled that the NLRC committed grave abuse of discretion in immediately denying the motion without fixing an appeal bond in an amount that was reasonable, as it denied the respondents of their right to appeal from the decision of the LA.29 The CA explained that "(w)hile Art. 223 of the Labor Code requiring bond equivalent to the monetary award is explicit, Section 6, Rule VI of the NLRC Rules of Procedure, as amended, recognized as exception a motion to reduce bond upon meritorious grounds and upon posting of a bond in a reasonable amount in relation to the monetary award.

Issue: Whether NLRC erred in denying the motion to reduce appeal bond by respondents?

Ruling: The posting of a bond is indispensable to the perfection of an appeal in cases involving monetary awards from the decision of the Labor Arbiter. The word "only" in Section 6, Rule VI of the 2011 NLRC Rules of Procedure makes it clear that the posting of a cash or surety bond by the employer is the essential and exclusive means by which an employer’s appeal may be perfected.

The prevailing jurisprudence on the matter provides that the filing of a motion to reduce bond, coupled with compliance with the two conditions emphasized in Garcia v. KJ Commercial for the grant of such motion, namely, (1) a meritorious ground, and (2) posting of a bond in a reasonable amount, shall suffice to suspend the running of the period to perfect an appeal from the labor arbiter’s decision to the NLRC. To require the full amount of the bond within the 10-day reglementary period would only render nugatory the legal provisions which allow an appellant to seek a reduction of the bond.

Jurisprudence tells us that in labor cases, an appeal from a decision involving a monetary award may be perfected only upon the posting of cash or surety bond. The Court, however, has relaxed this requirement under certain exceptional circumstances in order to resolve controversies on their merits. These circumstances include: (1) fundamental consideration of substantial justice; (2) prevention of miscarriage of justice or of unjust enrichment; and (3) special circumstances of the



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)case combined with its legal merits, and the amount and the issue involved.

Furthermore, on the matter of the filing and acceptance of motions to reduce appeal bond, as provided in Section 6, Rule VI of the 2011 NLRC Rules of Procedure, the Court hereby RESOLVES that henceforth, the following guidelines shall be observed:

(a) The filing o a motion to reduce appeal bond shall be entertained by the NLRC subject to the following conditions: (1) there is meritorious ground; and (2) a bond in a reasonable amount is posted;(b) For purposes o compliance with condition no. (2), a motion shall be accompanied by the posting o a provisional cash or surety bond equivalent to ten percent (10,) of the monetary award subject o the appeal, exclusive o damages and attorney's fees;(c) Compliance with the foregoing conditions shall suffice to suspend the running o the 1 0-day reglementary period to perfect an appeal from the labor arbiter's decision to the NLRC;(d) The NLRC retains its authority and duty to resolve the motion to reduce bond and determine the final amount o bond that shall be posted by the appellant, still in accordance with the standards o meritorious grounds and reasonable amount; and(e) In the event that the NLRC denies the motion to reduce bond, or requires a bond that exceeds the amount o the provisional bond, the appellant shall be given a fresh period o ten 1 0) days from notice o the NLRC order within which to perfect the appeal by posting the required appeal bond.

The Court ruled that conditions for the reduction of an appeal bond were duly satisfied by the respondents.104 Rolando Otsuka

105 Wilgen Piedad

106 Banahaw RigorBANAHAW VS. CAYETANOG.R. No. 171673 MAY 20, 2011LEONARDO-DE CASTRO, J.:

FACTS:Respondents in the case at bar, Cayetano , and others (collectively, the DXWG personnel), are supervisory and rank and file employees of the DXWG-Iligan City radio station which is owned by petitioner Banahaw Broadcasting Corporation (BBC), a corporation managed by Intercontinental Broadcasting Corporation (IBC). The DXWG personnel filed with the Sub-regional Arbitration Branch No. XI, Iligan City a complaint for illegal dismissal, unfair labor practice, reimbursement of unpaid Collective Bargaining Agreement (CBA) benefits, and attorney’s fees against IBC and BBC. The labor arbiter rendered a decision in favor of the employees. A Motion to Dismiss, Release, Waiver and Quitclaim, was jointly filed by IBC and the DXWG personnel based on the latter’s admission that IBC is not their employer as it does not own DXWG-Iligan City. This was granted. BBC later on was held as the person who must be the only liable. Both BBC and respondents appealed to the NLRC anew, for the insufficient satisfaction of the awarded monetary worth to DXWG. The NLRC issued an Order denying the Motion for the Recomputation of the Monetary Award. According to the NLRC, such recomputation would result in the premature resolution of the issue raised on appeal. The NLRC ordered BBC to post the required bond within 10 days from receipt of said Order, with a warning that noncompliance will cause the dismissal of the appeal for non-perfection. Instead of complying with the Order to post the required bond, BBC filed a Motion for Reconsideration, alleging this time that since it is wholly owned by the Republic of the Philippines, it need not post an appeal bond. The NLRC dismissed the joint petition. Upon review by Rule 65 to the Court of Appeals, it rendered the assailed Decision denying BBC’s Petition for Certiorari. The Court of Appeals held that BBC, though owned by the government, is a corporation with a personality distinct from the Republic or any of its agencies or instrumentalities, and therefore do not partake in the latter’s exemption from the posting of appeal bonds.

ISSUE: Whether or not BBC is exempt from posting an appeal bond?

RULING: NO.

As a general rule, the government and all the attached agencies with no legal personality distinct



Labor Relations - Jurisdiction and Procedure (Consolidated Case Digest)from the former are exempt from posting appeal bonds, whereas government-owned and controlled corporations (GOCCs) are not similarly exempted. This distinction is brought about by the very reason of the appeal bond itself: to protect the presumptive judgment creditor against the insolvency of the presumptive judgment debtor. When the State litigates, it is not required to put up an appeal bond because it is presumed to be always solvent. [36] This exemption, however, does not, as a general rule, apply to GOCCs for the reason that the latter has a personality distinct from its shareholders. Thus, while a GOCC’s majority stockholder, the State, will always be presumed solvent, the presumption does not necessarily extend to the GOCC itself. However, when a GOCC becomes a “government machinery to carry out a declared government policy,” it becomes similarly situated as its majority stockholder as there is the assurance that the government will necessarily fund its primary functions. Thus, a GOCC that is sued in relation to its governmental functions may be, under appropriate circumstances, exempted from the payment of appeal fees.In the case at bar, BBC was organized as a private corporation, sequestered in the 1980’s and the ownership of which was subsequently transferred to the government in a compromise agreement. Further, it is stated in its Amended Articles of Incorporation that BBC has the following primary function:

To engage in commercial radio and television broadcasting, and for this purpose, to establish, operate and maintain such stations, both terrestrial and satellite or interplanetary, as may be necessary for broadcasting on a network wide or international basis.It is therefore crystal clear that BBC’s function is purely commercial or proprietary and not governmental. As such, BBC cannot be deemed entitled to an exemption from the posting of an appeal bond. Consequently, the NLRC did not commit an error, and much less grave abuse of discretion, in dismissing the appeal of BBC on account of non-perfection of the same. In doing so, the NLRC was merely applying Article 223 of the Labor Code

The posting of the appeal bond within the period provided by law is not merely mandatory but jurisdictional. The failure on the part of BBC to perfect the appeal thus had the effect of rendering the judgment final and executory.

In the case at bar, BBC already took a risk when it filed its Motion for the Recomputation of the Monetary Award without posting the bond itself. The Motion for the Recomputation of the Monetary Award filed by BBC, like the Motion for Extension to File the Appeal Bond in Lamzon, was itself tantamount to a motion for extension to perfect the appeal, which is prohibited by the rules. The NLRC already exhibited leniency when, instead of dismissing the appeal outright, it merely ordered BBC to post the required bond within 10 days from receipt of said Order, with a warning that noncompliance will cause the dismissal of the appeal for non-perfection. When BBC further demonstrated its unwillingness by completely ignoring this warning and by filing a Motion for Reconsideration on an entirely new ground, the NLRC cannot be said to have committed grave abuse of discretion by making good its warning to dismiss the appeal. Therefore, the Court of Appeals committed no error when it upheld the NLRC’s dismissal of petitioner’s appeal.



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