Reliance Surety & Insurance Co., Inc vs.

NLRC (1991)
Sarmiento, J.
                                 

Facts:
          Management of Reliance Surety & Insurance Co, Inc. re-arranged the sitting arrangement of its staff to lessen
non-work related conversations, personal telephone calls and non-work related visits.  Employees who were
members of the union took the changes as a means of singling them out and applying pressure on them to quit the
union or to be more submissive to the company.
          Union members refused to obey the new arrangement and even cursed and argued with management for which
they were disciplined and eventually dismissed. This prompted the complaint in the NLRC against the company
wherein the workers alleged unfair work practices.
          While the complaint was hibernating [cooling off period] the employees staged a strike that did not get the
majority vote of the union as required. This prompted the company to file a complaint with the NLRC because they
alleged that the strike was illegal.
          Labor arbiter and NLRC found the strike to be illegal but ruled that dismissal it too severe a punishment. The
company should reinstate the employees without back-pay which they deemed punishment enough.

Doctrine:
          The Company merely exercised its prerogative in assigning new seats for the benefit of the company and it did
not in any way constitute an unfair labor practice.
          The strike was not only illegal but it was also violent wherein the union harassed not only management but also
other employees not on strike.
          Citing Ferrer v. Almira  a violation of the cooling off period in good faith is merely a defective strike whereas
in this case the violation was done in bad faith hence the strike is illegal
          Citing Bacus v. Ople  mere finding of  ‘illegality’ attending the strike cannot be used to dismiss employees who
were impressed with good faith.

          As a general rule the sympathy of the court is with the laboring classes BUT the court must however take care to
ensure that the results achieved are fair and in conformity with the rules. The employees are validly dismissed
because the court held that no good faith could be found in the instant case but rather ‘plain arrogance, pride and
cynicism.
Nestle Philippines vs NLRC Case Digest
Nestle Philippines, Inc. vs. NLRC and Union of Filipro Employees 
193 SCRA 504

Facts: Four (4) collective bargaining agreements separately covering the petitioner's employees in its
Alabang/Cabuyao factories; Makati Administration Office. (Both Alabang/Cabuyao factories and Makati office were
represented by the respondent, Union of Filipro Employees [UFE]);Cagayan de Oro Factory represented by WATU;
and Cebu/Davao Sales Offices represented by the Trade Union of the Philippines and Allied Services (TUPAS), all
expired on June 30, 1987. UFE was certified as the sole and exclusive bargaining agent for all regular rank-and-file
employees at the petitioner's Cagayan de Oro factory, as well as its Cebu/Davao Sales Office. 

In August 1987, while the parties, were negotiating, the employees at Cabuyao resorted to a "slowdown" and walk-
outs prompting the petitioner to shut down the factory. Marathon collective bargaining negotiations between the
parties ensued. On September 1987, the UFE declared a bargaining deadlock. On September 8, 1987, the Secretary
of Labor assumed jurisdiction and issued a return to work order. In spite of that order, the union struck, without notice,
at the Alabang/Cabuyao factory, the Makati office and Cagayan de Oro factory on September 11, 1987 up to
December 8, 1987. The company retaliated by dismissing the union officers and members of the negotiating panel
who participated in the illegal strike. The NLRC affirmed the dismissals on November 2, 1988. On January 26, 1988,
UFE filed a notice of strike on the same ground of CBA deadlock and unfair labor practices. 

However, on March 30, 1988, the company was able to conclude a CBA with the union at the Cebu/Davao Sales
Office, and on August 5, 1988, with the Cagayan de Oro factory workers. The union assailed the validity of those
agreements and filed a case of unfair labor practice against the company on November 16, 1988. After conciliation
efforts of the NCMB yielded negative results, the dispute was certified to the NLRC. The NLRC issued a resolution on
June 5, 1989, whose pertinent disposition regarding the union's demand for liberalization of the company's retirement
plan for its workers. the NLRC issued a resolution denying the motions for reconsideration. With regard to the
Retirement Plan, the NLRC held that Anent management's objection to the modification of its Retirement Plan, the
plan is specifically mentioned in the previous bargaining agreements thereby integrating or incorporating the
provisions thereof to the agreement. By reason of its incorporation, the plan assumes a consensual character which
cannot be terminated or modified at will by either party. Consequently, it becomes part and parcel of CBA
negotiations. 

Petitioner alleged that since its retirement plan is non-contributory, Nestle has the sole and exclusive prerogative to
define the terms of the plan because the workers have no vested and demandable rights, the grant thereof being not
a contractual obligation but merely gratuitous. At most the company can only be directed to maintain the same but not
to change its terms. It should be left to the discretion of the company on how to improve or modify the same. 

Issue: Whether or not the workers have vested and demandable rights over the retirement plan. 

Ruling: The Court ruled that employees have a vested and demandable right over the retirement plan. The inclusion
of the retirement plan in the collective bargaining agreement as part of the package of economic benefits extended by
the company to its employees to provide them a measure of financial security after they shall have ceased to be
employed in the company, reward their loyalty, boost their morale and efficiency and promote industrial peace, gives
"a consensual character" to the plan so that it may not be terminated or modified at will by either party. 

The fact that the retirement plan is non-contributory, i.e., that the employees contribute nothing to the operation of the
plan, does not make it a non-issue in the CBA negotiations. As a matter of fact, almost all of the benefits that the
petitioner has granted to its employees under the CBA — salary increases, rice allowances, midyear bonuses, 13th
and 14th month pay, seniority pay, medical and hospitalization plans, health and dental services, vacation, sick &
other leaves with pay — are non-contributory benefits. Since the retirement plan has been an integral part of the CBA
since 1972, the Union's demand to increase the benefits due the employees under said plan, is a valid CBA issue. 

The petitioner's contention, that employees have no vested or demandable right to a non-contributory retirement plan,
has no merit for employees do have a vested and demandable right over existing benefits voluntarily granted to them
by their employer. The latter may not unilaterally withdraw, eliminate or diminish such benefits.
Ilaw at Buklod ng Manggagawa vs. NLRC GR No. 91980. June
27, 1991
Facts:
                    The Union known as Ilaw at Buklod ng Manggagawa (IBM) said to represent 4,500 employees of San Miguel
Corporation, presented to the company a demand for correction of the significant distortion in wages.
In that demand, the Union explicitly invoked Section 4 of RA 6727, “The Wage Rationalization Act”, which reads as
follows:
Where the application of the increases in the wages rates under this section results in distortions as defined under
existing laws in the wage structure within an establishment and gives rise to dispute therein, such dispute shall first be settled
voluntarily between the parties and in the event of a deadlock, the same shall be finally resolved through compulsory arbitration
by the regional branches of the National Labor Relations Commission having jurisdiction over the workplace.
It shall be mandatory for the NLRC to conduct continuous hearings and decide any dispute arising under this section
within twenty (20) calendar days from the time said dispute is formally submitted to it for arbitration. The pendency of a dispute
arising from a wage distortion shall not in any way delay the applicability of the increase in the wage rates prescribed under this
section.
The Union claims that the demand was ignored. When the Company rejected the reduced proposal of the Union the
members thereof, on their own accord, refused to render overtime services, most especially at the Beer Bottling Plants at Polo,
starting October 16, 1989. In this connection, the workers involved issues a joint notice reading as follows:
Sama-samang pahayag: Kaming arawang manggagawa ng Polo Brewery pawang kasapi ng Ilaw at Buklod ng
Manggagawa (IBM) ay nagkakaisang nagpasya na ipatupad muna ang eight hours work shift pansamantala habang hindi
ipinapatupad ng SMC Management ang tamang Wage Distortion.

Issue:
Whether or not wage distortion shall be a ground for strike/lockout.

Ruling:
            No.
            It is SMC's submittal that the coordinated reduction by the Union's members of the work time theretofore willingly and
consistently observed by them, thereby causing financial losses to the employer in order to compel it to yield to the demand for
correction of "wage distortions," is an illegal and "unprotected" activity. It is, SMC argues, contrary to the law and to the
collective bargaining agreement between it and the Union. The argument is correct and will be sustained.
Among the rights guaranteed to employees by the Labor Code is that of engaging in concerted activities in order to
attain their legitimate objectives. Article 263 of the Labor Code, as amended, declares that in line with "the policy of the State to
encourage free trade unionism and free collective bargaining. Workers shall have the right to engage in concerted activities for
purposes of collective bargaining or for their mutual benefit and protection." A similar right to engage in concerted activities for
mutual benefit and protection is tacitly and traditionally recognized in respect of employers.
The more common of these concerted activities as far as employees are concerned are: strikes; picketing; and boycotts.
On the other hand, the counterpart activity that management may licitly undertake is the lockout. In this connection, the same
Article 263 provides that the "right of legitimate labor organizations to strike and picket and of employer to lockout, consistent
with the national interest, shall continue to be recognized and respected." The legality of these activities is usually dependent on
the legality of the purposes sought to be attained and the means employed therefor.
It goes without saying that these joint or coordinated activities may be forbidden or restricted by law or contract.
In the particular instance of "distortions of the wage structure within an establishment" resulting from "the application
of any prescribed wage increase by virtue of a law or wage order," Section 3 of Republic Act No. 6727 prescribes a specific,
detailed and comprehensive procedure for the correction thereof, thereby implicitly excluding strikes or lockouts or other
concerted activities as modes of settlement of the issue.
            The legislative intent that solution of the problem of wage distortions shall be sought by voluntary negotiation or
abitration, and not by strikes, lockouts, or other concerted activities of the employees or management, is made clear in the rules
implementing RA 6727 issued by the Secretary of Labor and Employment pursuant to the authority granted by Section 13 of the
Act. Section 16, Chapter I of these implementing rules, after reiterating the policy that wage distortions be first settled voluntarily
by the parties and eventually by compulsory arbitration, declares that, "Any issue involving wage distortion shall not be a ground
for a strike/lockout."