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G.R. No. 144315 July 17, 2006

PHILCOM EMPLOYEES UNION, petitioner,

vs.

PHILIPPINE GLOBL COMMUNIC!IONS "#$ PHILCOM

CORPOR!ION, respondents.

D E C I S I O N

CRPIO,  J.%

!&' C"('

 This is a petition for review1 to annul the Decision2 dated 31 ul! 2""" of the

Court of #ppeals in C#$%.&. S' No. (3)*). The Court of #ppeals a+red the

assailed portions of the 2 Octo-er 1))* and 2 Nove-er 1))* Orders of the

Secretar! of /a-or and Eplo!ent in OS$#$""22$).

!&' )"*+(

 The facts, as suari0ed -! the Court of #ppeals, are as follows

pon the epiration of the Collective 4ar5ainin5 #5reeent 6C4#7

-etween petitioner 'hilco Eplo!ees nion 6'E or union, for

-revit!7 and private respondent 'hilippine %lo-al Counications, Inc.

6'hilco, Inc.7 on une 3", 1)), the parties started ne5otiations for

the renewal of their C4# in ul! 1)). 8hile ne5otiations were on5oin5,

'E 9led on Octo-er 21, 1)) with the National Conciliation and

:ediation 4oard 6NC:47 ; National Capital &e5ion, a Notice of Stri

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On Nove-er 1, 1)), however, while the union and the copan!

o+cers and representatives were eetin5, the reainin5 union o+cers

and e-ers sta5ed a stri

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>6e7 :isipleentation andFor non$ipleentation of

eplo!eesA -ene9ts li

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%oin5 now to the 9rst issue at hand, a readin5 of the coplaints

char5ed -! the nion as unfair la-or practices would reveal that these

are not so within the le5al connotation of #rticle 2=* of the /a-or Code.

On the contrar!, these coplaints are actuall! ere 5rievances which

should have -een processed throu5h the 5rievance achiner! or

voluntar! ar-itration outlined under the C4#. The issues of Jei-le

la-or and additional functions, isipleentation or non$

ipleentation of eplo!ee -ene9ts, non$pa!ent of overtie and

other onetar! clais and inadeBuate transportation allowance, are

all a atter of ipleentation or interpretation of the econoic

provisions of the C4# su-@ect to the 5rievance procedure.

Neither do these coplaints aount to 5ross violations which, thus,

a! -e treated as unfair la-or practices outside of the covera5e of

#rticle 2?1. The nion failed to convincin5l! show that there is Ja5rantandFor alicious refusal -! the Copan! to copl! with the econoic

provisions stipulated in the C4#.

8ith respect to the char5es of contractuali0ation and econoic

induceent, this O+ce is convinced that the acts of said copan!

Bualif! as a valid eercise of ana5eent prero5ative. The act of the

Copan! in contractin5 out wor< or certain services -ein5 perfored

-! nion e-ers should not -e seen as an unfair la-or practice act

per se. irst, the char5e of assive contractuali0ation has not -een

su-stantiated while the contractuali0ation of the position of '#4operator is an isolated instance. Secondl!, in the latter case, there was

no proof that such contractin5 out interfered with, restrained or

coerced the eplo!ees in the eercise of their ri5ht to self$

or5ani0ation. Thus, it is not unfair la-or practice to contract out wor<

for reason of reduction of la-or cost throu5h the acBuisition of

autoatic achines.

/i

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 There reains the issue on -ar5ainin5 deadloc

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hearin5 a! the respective lia-ilities of nion o+cers and e-ers -e

deterined. The case of Telefun

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#tt!. /ita K. #5li-ut, O+cer$In$Char5e of the /e5al Service, this

Departent is here-! desi5nated as the earin5 O+cer to hear and

receive evidence on all atters and issues arisin5 fro the present

la-or dispute and, thereafter, to su-it a reportFrecoendation

within twent! 62"7 da!s fro the terination of the proceedin5s.

 The parties are further directed to 9le their respective position papers

with #tt!. /ita K. #5li-ut within ten 61"7 da!s fro receipt of this Order.

SO O&DE&ED.(

'hilco Corporation 6>'hilco>7 9led a otion for reconsideration. 'hilco

pra!ed for reconsideration of the Order ipleadin5 it as part!$liti5ant in the

present case and directin5 it to accept -ac< to wor< unconditionall! all the

o+cers and e-ers of the union who participated in the stri

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-etween the Copan! and the nion o+cers and e-ers was never

severed. #nd in er5er, the eplo!ees of the er5ed copanies or

entities are deeed a-sor-ed -! the new copan! 6ilipinas 'ort

Services, Inc. v. N/&C, et. al., %.&. No. )23, #u5ust 1?, 1))17.

Considerin5 that the Copan! failed isera-l! to adduce an! evidence

to provide a -asis for a contrar! rulin5, alle5ations to the eGect that

eplo!er$eplo!ee relations and positions previousl! occupied -! the

wor

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1))) in %.&. No. 123=2? entitled National Federation of Labor (NFL) vs. Hon.

Bienvenido E. Laguesma, Undersecretary of te !e"artment of Labor and

Em"loyment, and #lliance of Nationalist $enuine Labor %rgani&ation,

'ilusang ayo Uno (#N$L%'U),11 referred the case to the Court of

#ppeals.12

!&' Rul#- o +&' Cou/+ o '"l(

On 31 ul! 2""", the Court of #ppeals rendered @ud5ent as follows

8E&EO&E, '&E:ISES CONSIDE&ED, this petition is here-! DENIED.

 The assailed portions of the Orders of the Secretar! of /a-or and

Eplo!ent dated Octo-er 2, 1))* and Nove-er 2, 1))* are

#I&:ED.

SO O&DE&ED.13

 The Court of #ppeals ruled that, contrar! to 'EAs view, the Secretar! could

ta

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 The Court of #ppeals held that 'hilcoAs acts, which 'E coplained of as

unfair la-or practices, were not in an! wa! related to the wor

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andatin5Fdirectin5 the issuance of a writ of eecution directin5 the

Copan! to unconditionall! accept -ac< to wor< the nion o+cers and

e-ers under the sae ters and conditions prior to the stri

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8hen, in his opinion, there eists a la-or dispute causin5 or li

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the da!$to$da! operations of their -usinesses and coercial

transactions. The operational via-ilit! of the copan! is li

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On the docuents attached to 'hilcoAs position paper, ecept for #nnees

::$2 to ::$22 inclusive22 which deal with the supposed consolidation of

'hilippine %lo-al Counications, Inc. and 'hilco Corporation, we 9nd the

other annees relevant and aterial in the resolution of the issues that have

eer5ed in this case.

'E also clais that 'hilco has coitted several unfair la-or practices.

'E asserts that there are >factual and evidentiar! -ases> for the char5e of

unfair la-or practices a5ainst 'hilco.

On unfair la-or practices of eplo!ers, #rticle 2=* of the /a-or Code

provides

U#"/ l"o/ /"*+*'( o 'loy'/(. $ It shall -e unlawful for an

eplo!er to coit an! of the followin5 unfair la-or practice

6a7 To interfere with, restrain or coerce eplo!ees in the eercise of

their ri5ht to self$or5ani0ation

6-7 To reBuire as a condition of eplo!ent that a person or an

eplo!ee shall not @oin a la-or or5ani0ation or shall withdraw fro one

to which he -elon5s

6c7 To contract out services or functions -ein5 perfored -! union

e-ers when such will interfere with, restrain or coerce eplo!ees inthe eercise of their ri5hts to self$or5ani0ation

6d7 To initiate, doinate, assist or otherwise interfere with the

foration or adinistration of an! la-or or5ani0ation, includin5 the

5ivin5 of 9nancial or other support to it or its or5ani0ers or supporters

6e7 To discriinate in re5ard to wa5es, hours of wor

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6h7 To pa! ne5otiation or attorne!As fees to the union or its o+cers or

a5ents as part of the settleent of an! issue in collective -ar5ainin5 or

an! other dispute or

6i7 To violate a collective -ar5ainin5 a5reeent.

nfair la-or practice refers to acts that violate the wor

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prootion of several technicians to CE 6pars. )$12, 'hilcoAs &epl! to

'EAs 'osition 'aper #nne >E>, 'etition pp. 3("$3(1, i-id.7.

On the alle5ed isipleentation andFor non$ipleentation of

eplo!eesA -ene9ts, such as shoe allowance, rain-oots, raincoats, OIC

shift allowance, '=("."" onthl! allowance, drivin5 allowance,

otorc!cle award and full$tie ph!sician, the copan! 5ave the

followin5 eplanation which this Court 9nds plausi-le, to wit

1?. The eplo!ees at CTSS were 5iven One Thousand 'esos

6'1,""".""7 cash or its eBuivalent in purchase orders -ecause it

was their own deand that the! -e 5iven the option to -u! the

pair of leather -oots the! want. or the Ce-u -ranch, the

eplo!ees theselves failed to include these -ene9ts in the list

of their deands durin5 the preparation of the -ud5et for the!ear 1)) despite the instruction 5iven to the -! the -ranch

ana5er. #ccordin5 to the eplo!ees, the! were not aware that

the! were entitled to these -ene9ts. The! thou5ht that -ecause

the! have -een provided with two vans to 5et to their respective

assi5nents, these -ene9ts are availa-le onl! to collectors,

essen5ers and technicians in otorc!cles.

1. The '=("."" onthl! allowance was provided -! the C4# to

-e 5iven to counter cler

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than an! full tie ph!sician can 5ive. It places at the eplo!eesA

disposal nuerous specialists in various 9elds of edicine. It is

-e!ond understandin5 wh! the nion would insist on havin5 a

full$tie ph!sician when the! could avail of -etter services fro

'rola- Dia5nostics.

6'hilcoAs &epl! to 'EAs 'osition 'aper, pp.3(2, 3(=, i-id.7

On the issue of non$pa!ent, discriination andFor deprivation of

overtie, restda! wor

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was vacant while the assuption of the function -! the copan! 5uard

durin5 ni5httie was onl! for a -rief period.

8ith respect to the perceived assive contractuali0ation of the

copan!, said char5e cannot -e considered as /' since the hirin5 of

contractual wor6T7he prootion of eplo!ees to

ana5erial or eecutive positions rests upon the discretion of

ana5eent. :ana5erial positions are o+ces which can onl! -e held

-! persons who have the trust of the corporation and its o+cers. It is

the prero5ative of ana5eent to proote an! individual wor

 That the prootions were ade near or around the tie when C4#

ne5otiations were a-out to -e held does not a=>, 'hilcoAs

&epl! to 'EAs 'osition 'aper p. 3*", i-id.7

On the unionAs char5e that ana5eent disallowed leave of union

o+cers and e-ers to attend union seinar, this is -elied -! the

evidence su-itted -! the union itself. In a letter to 'EAs 'resident,

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the copan! 5ranted the leave of several union o+cers and e-ers

to attend a seinar notwithstandin5 that its reBuest to -e 5iven ore

details a-out the aGair was left unheeded -! the union 6#nne >P>,

'EAs 'osition 'aper p. 222, i-id.7. Those who were denied leave were

ur5entl! needed for the operation of the copan!.

On the /' issue of disinforation schee, surveillance and

interference with union aGairs, these are ere alle5ations unsupported

-! facts. The char5e of >-lac< propa5anda> alle5edl! coitted -! the

copan! when it supposedl! posted two 627 letters addressed to the

nion 'resident is totall! -aseless. 'etitioner presents no proof that it

was the copan! which was -ehind the incident. On the purported

disallowance of union e-ers to o-serve the ul! 2, 1)) C4#

eetin5, the copan! eplained that it onl! allowed one 617 eplo!ee

fro ITTO, instead of two 627, as it would adversel! aGect the operationof the 5roup. It also too< into consideration the fact that ITTO e-ers

represent onl! 2"Q of the union. Other union e-ers fro other

departents of the copan! should have eBual representation 6#nne

>/>, 'osition 'aper for the nion pp. 2"($2"?, i-id.7. #s to the alle5ed

surveillance of the copan! 5uards durin5 a union seinar, 8e 9nd

the idea of sendin5 5uards to sp! on a ere union seinar Buite

preposterous. It is thus not li

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2*. Contrar! to the alle5ations of the nion, the rationale and

echanics for the a-olishent of the idni5ht schedule at the

 Tra+c &ecord Services had -een thorou5hl! and adeBuatel!

discussed with the nionAs 'resident, &o-ert 4enosa, and the

staG of Tra+c &ecord Services in the eetin5 held on :a! ),

1)). The idni5ht services were a-olished for purel! econoic

reasons. The copan! reali0ed that the idni5ht wor< can -e

handled in the ornin5 without haperin5 noral operations. #t

the sae tie, the copan! will -e a-le to save on cost. or this

o-@ective, the eplo!ees concerned a5reed to create a annin5

and shiftin5 schedule startin5 at ?"" a.. up to 1""" p.., with

each eplo!ee renderin5 onl! ei5ht hours of wor< ever! da!

without violatin5 an! provision of the la-or laws or the C4#.2=

 The Court has alwa!s respected a copan!As eercise of its prero5ative todevise eans to iprove its operations. Thus, we have held that

ana5eent is free to re5ulate, accordin5 to its own discretion and

 @ud5ent, all aspects of eplo!ent, includin5 hirin5, wor< assi5nents,

supervision and transfer of eplo!ees, worissue of ille5al stri

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terinated as a result of the alle5ed ille5al stri

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It is therefore clear that the stri

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#&T. 2?=. 'rohi-ited activities.  ─  6a7

No (+/=' o/ lo*=ou+ (&"ll ' $'*l"/'$ "+'/ "((u+o# o

 @u/($*+o# y +&' P/'($'#+ o/ +&' M#(+'/ or after certi9cation

or su-ission of the dispute to copulsor! or voluntar! ar-itration or

durin5 the pendenc! of cases involvin5 the sae 5rounds for the stri

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stri

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even >advised to aintain the status Buo.>=( Such disre5ard of the ediation

proceedin5s was a -latant violation of Section ?, 4oo< K, &ule II of the

Oni-us &ules Ipleentin5 the /a-or Code, which eplicitl! o-li5es the

parties to -ar5ain collectivel! in 5ood faith and prohi-its the fro ipedin5

or disruptin5 the proceedin5s.=? The relevant provision of the Ipleentin5

&ules provides

Section ?. /onciliation.  ─  

Durin5 the proceedin5s, the parties shall not do an! act which a!

disrupt or ipede the earl! settleent of dispute. The! are o-li5ed, as

part of their dut!, to -ar5ain collectivel! in 5ood faith, to participate

full! and proptl! in the conciliation eetin5s called -! the re5ional

-ranch of the 4oard.

#rticle 2?=6a7 of the /a-or Code also considers it a prohi-ited activit! to

declare a stridurin5 the pendenc! of cases involvin5 the sae 5rounds

for the sae stri

/aenta-l!, 'E de9antl! proceeded with their strithe nionAs coplaints to the ana5eent -e5an

in une 1)) even -efore the start of the 1)) C4# rene5otiations.>= Their

C4# epired on 3" une 1)).=* 'E could have @ust ta

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# stri

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