COMPLEX ELECTRONICS EMPLOYEES ASSOCIATION v NLRC The Union anchors its position on the fact that Lawrence Qua

n the fact that Lawrence Qua is both

G.R. No. 121315-6; July 19, 1999 the president of Complex and Ionics and that both companies have the
same set of Board of Directors. It claims that business has not ceased
Doctrine: at Complex but was merely transferred to Ionics, a runaway shop. To
1. A "runaway shop" is defined as an industrial plant moved by its prove that Ionics was just a runaway shop, petitioner asserts that out
owners from one location to another to escape union labor regulations of the 80,000 shares comprising the increased capital stock of Ionics,
or state laws, but the term is also used to describe a plant removed to it was Complex that owns majority of said shares with P1,200,000.00
a new location in order to discriminate against employees at the old as its capital subscription and P448,000.00 as its paid up investment,
plant because of their union activities. compared to P800,000.00 subscription andP324,560.00 paid-up owing
to the other stockholders, combined. Thus, according to the Union,
2. The purpose of the notice requirement is to enable the proper there is a clear ground to pierce the veil of corporate fiction.
authorities to determine after hearing whether such closure is being Issue:
done in good faith, i.e., for bona fide business reasons, or whether, to 1. Whether or not Ionics is merely a runaway shop
the contrary, the closure is being resorted to as a means of evading 2. Whether or not there was ULP
compliance with the just obligations of the employer to the employees
affected. Ruling:
1. The Union’s contentions are untenable.
Facts:
Due to losses on production of the petitioner, it was constrained to A "runaway shop" is defined as an industrial plant moved by its owners
cease operations. In the evening of April 6, 1992, the machinery, from one location to another to escape union labor regulations or state
equipment and materials being used for production at Complex were laws, but the term is also used to describe a plant removed to a new
pulled-out from the company premises and transferred to the premises location in order to discriminate against employees at the old plant
of Ionics Circuit, Inc. (Ionics) at Cabuyao, Laguna. The following day, because of their union activities. It is one wherein the employer moves
a total closure of company operation was effected at Complex. its business to another location or it temporarily closes its business for
anti-union purposes. A "runaway shop" in this sense, is a relocation
A complaint was, thereafter, filed with the Labor Arbitration Branch of motivated by anti-union animus rather than for business reasons. In
the NLRC for unfair labor practice, illegal closure/illegal lockout, money this case, however, Ionics was not set up merely for the purpose of
claims for vacation leave, sick leave, unpaid wages, 13th month pay, transferring the business of Complex. At the time the labor dispute
damages and attorney’s fees. The Union alleged that the pull-out of arose at Complex, Ionics was already existing as an independent
the machinery, equipment and materials from the company premises, company. As earlier mentioned, it has been in existence since July 5,
which resulted to the sudden closure of the company was in violation 1984. It cannot, therefore, be said that the temporary closure in
of Section 3 and 8, Rule XIII, Book V of the Labor Code of the Complex and its subsequent transfer of business to Ionics was for anti-
Philippines and the existing CBA. Ionics was impleaded as a party union purposes. The Union failed to show that the primary reason for
defendant because the officers and management personnel of Complex the closure of the establishment was due to the union activities of the
were also holding office at Ionics with Lawrence Qua as the President employees.
of both companies.
The mere fact that one or more corporations are owned or controlled
by the same or single stockholder is not a sufficient ground for
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disregarding separate corporate personalities. Mere ownership by a
single stockholder or by another corporation of all or nearly all of the
capital stock of a corporation is not of itself sufficient ground for
disregarding the separate corporate personality.

2. The purpose of the notice requirement is to enable the proper

authorities to determine after hearing whether such closure is being
done in good faith, i.e., for bona fide business reasons, or whether, to
the contrary, the closure is being resorted to as a means of evading
compliance with the just obligations of the employer to the employees
affected. 28

While the law acknowledges the management prerogative of closing

the business, it does not, however, allow the business establishment to
disregard the requirements of the law. The case of Magnolia Dairy
Products v. NLRC is quite emphatic about this.

The law authorizes an employer, like the herein petitioners, to

terminate the employment of any employee due to the installation of
labor saving devices. The installation of these devices is a management
prerogative, and the courts will not interfere with its exercise in the
absence of abuse of discretion, arbitrariness, or maliciousness on the
part of management, as in this case. Nonetheless, this did not excuse
petitioner from complying with the required written notice to the
employee and to the Department of Labor and Employment (DOLE) at
least one month before the intended date of termination. This
procedure enables an employee to contest the reality or good faith
character of the asserted ground for the termination of his services
before the DOLE.

The failure of petitioner to serve the written notice to private

respondent and to the DOLE, however, does not ipso facto make
private respondent’s termination from service illegal so as to entitle her
to reinstatement and payment of backwages. If at all, her termination
from service is merely defective because it was not tainted with bad
faith or arbitrariness and was due to a valid cause.

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ASSOCIATED LABOR UNION v JUDGE JOSE C. BORROMEO Issue:
G.R. No. L-26461 November 27, 1968 Whether or not the RTC has Jurisdiction over Labor Cases?

Doctrine: Ruling:
The courts of law have no jurisdiction to act on labor cases or various No. The courts of law have no jurisdiction to act on labor cases or
incidents arising therefrom. That is basic and elementary. Jurisdiction various incidents arising therefrom. That is basic and elementary.
to try and adjudicate such cases pertains exclusively to the proper Jurisdiction to try and adjudicate such cases pertains exclusively to the
labor officials of the Department of Labor proper labor officials of the Department of Labor.

Jurisdiction is vested bylaw and not by the demands of emergency. The respondent judge cannot enjoin acts carried out as a consequence
of the strike without unavoidably ruling on the legality of the strike
Facts: itself. (“The strike can continue. It does not mean that this Court has
It appears that on June 24, 1986, as a consequence of a controversy ruled on the legality or illegality of the said strike.”) To say indeed that
arising from charges of unfair labor practices against the respondent, the workers had obstructed free passage to the strike-bound firm, is by
BELYCA Corporation, the petitioner filed a notice of strike with the then necessity, to say that the strike was illegal, notwithstanding the judge’s
Ministry of Labor and Employment. own words of caution (that he was not ruling on the legality or illegality
of the strike.
On the same date, the private respondent commenced suit for
injunction with the respondent RTC. It alleged that the petitioner had The fact that the poultry and piggery maintained by the private
obstructed free ingress to the firm's premises, "preventing workers of respondent required close care and attention does not warrant the
Belyca farms from entering the business establishments ... preventing respondent judge’s assumption of jurisdiction. It did not confer on him
said workers from giving feeds and/or food to the hogs and fowls which the competence he did not have. Jurisdiction is vested by law and not
would kill all of said hogs and fowls if not attended to this very day by the demands of emergency.
..." (The private respondent maintains "about 7,500 hogs and with
8,000 fowls with a total value of about P10,000.00." ) On the same day, Judge committed a grave abuse of discretion.—This is not, of course,
the respondent judge issued a temporary restraining order (TRO) to say that the strike in question was, ergo, legal. As we said, concerted
"commanding herein defendants [the striking workers], their agents acts of labor are the domain of the labor officials, not the judiciary.
and/or representatives to allow plaintiff [the private-respondent) or Assuming, then, that the private respondent had cause for complaint—
workers or authorized representatives free passage to and from Belyca and that the strike was illegal or had become illegal as a result of the
Farms, located at Kalasungay Malaybalay, Bukidnon to feed plaintiffs strikers’ resort to illegal acts—the courts are not the proper forum for
seven thousand five hundred (7,500) hogs and eight thousand (8,000) it. The gross haste, furthermore, with which the challenged TRO was
fowls." issued (it was issued on the same day the complaint was filed)—and
based on the bare word alone of Belyca (that the strikers had behaved
On August 4, 1986, the petitioner filed a motion for reconsideration (to unlawfully in the course of the strike)—has not eluded this Court. This
lift TRO as well as for the dismissal of the case on the ground of lack is a grave abuse of discretion. Plainly, it denied the workers due process
of jurisdiction. On August 14, 1986, the respondent judge denied the of law.
motion.

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Panay Electric Company Inc. vs. NLRC
G.R. No. 102672 October 4, 1995 In its position paper and memorandum before the NLRC, the union
averred that the real reason for ordering the transfer of Huyan was to
Doctrine: penalize him for his union activities, particularly for being the suspected
The State guarantees the right of all workers to self-organization, "Mao," author of the column "Red Corner," in the Union's New Digest
collective bargaining and negotiations, as well as peaceful concerted which featured an item on alleged wrongdoings by top company
activities, including the right to strike, in accordance with law.7 The officials at the power plant.
right to strike, however, is not absolute. It has heretofore been held
that a "no strike, no lock-out" provision in the Collective Bargaining Petitioner company, in turn, maintained hat in declaring a strike, the
Agreement ("CBA") is a valid stipulation although the clause may be Union, including its officers and members, committed a serious breach
invoked by an employer only when the strike is economic in nature or of the "no strike, no lock out clause," of the Collective Bargaining
one which is conducted to force wage or other concessions from the Agreement ("CBA"); and that during the strike, illegal acts were
employer that are not mandated to be granted by the law itself. committed by the union officers and members.
Facts:
On 30 October 1990, petitioner Panay Electric Company, Inc., posted Issue:
in its premises a notice announcing the need for a "Report Clerk" who Whether or not the strike conducted by the Union from January 22 to
could assume the responsibility of gathering accounting and computer 25, 1991 to be illegal as the same was staged in violation of the no
data at its power plant. When nobody applied for the position, the strike, no lock-out clause in the Collective Bargaining Agreement.
EDP/Personnel Manager recommended Enrique Huyan who was at the
time an Administrative Personnel Assistant at the head office. Huyan Held:
was then also a Vice President of respondent union. The The State guarantees the right of all workers to self-organization,
recommendation was approved by the company's President and collective bargaining and negotiations, as well as peaceful concerted
General Manager. activities, including the right to strike, in accordance with law. The right
to strike, however, is not absolute.
In a letter, dated 09 November 1990, Enrique Huyan informed
petitioner that he was not interested in accepting the new position for It has heretofore been held that a "no strike, no lock-out" provision in
he sees it as a demotion on his part. Eventually, on 03 December 1990, the Collective Bargaining Agreement ("CBA") is a valid stipulation
Huyan was given a "notice of dismissal" for gross insubordination. although the clause may be invoked by an employer only when the
Respondent union, on 20 December 1990, filed a notice of strike. strike is economic in nature or one which is conducted to force wage
or other concessions from the employer that are not mandated to be
On 02 January 1990, a strike vote was taken where 113 out of 149 granted by the law itself.
union members voted; the result showed 108 "yes" votes, 1 "no" vote,
and 4 abstentions. On 22 January 1991, the union went on strike. It would be inapplicable to prevent a strike which is grounded on unfair
Forthwith, the company filed a petition to declare the strike illegal. On labor practice. In this situation, it is not essential that the unfair labor
25 January 1991, upon receipt of an order from the Secretary of Labor practice act has, in fact, been committed; it suffices that the striking
and Employment certifying the dispute to the NLRC, the union lifted its workers are shown to have acted honestly on an impression that the
strike and, on the day following, the striking employees, including company has committed such unfair labor practice and the surrounding
Huyan, reported for work. circumstances could warrant such a belief in good faith.
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