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Molave Motor Sales vs.

Judge Laron
Petitioner is a corporation engaged in the sale and repair of motor vehicles.Private respondent isthe
sales manager of PLAINTIFF. At the pre-trial conference, the DEFENDANT raised the question
of jurisdiction of the Court stating that PLAINTIFF's complaint arose out of employer-employee
relationship, and he subsequently moved for dismissal. Such complaint was dismissed by the judge
because it must be the juris of the LA and NLRC to decide cases on ER-EE relationship. However,
although a controversy is between an employer and an employee, the Labor Arbiters have no
jurisdiction if the Labor Code is not involved. In this case, PLAINTIFF had sued for moniesloaned
to DEFENDANT, the cost of repair jobs made on his personal cars, and for the purchase price of
vehicles and parts sold to him. Those accounts have no relevance to the Labor Code. hence, the
civil has the juris over the matter.
Whether or not there was still a relationship of employer and employee between the parties.
The dismissal of the case below on the ground that the sum of money and damages sued upon
arose from employer-employee relationship was erroneous. Claims arising from employer-
employee relations are now limited to those mentioned in paragraphs 2 and 3 of Article 217. There
is no difficulty in stating that those in the case below should not be faulted for not being aware of
the last amendment to the frequently changing Labor Code.The claim of DEFENDANT that he
should still be considered an employee of PLAINTIFF, because the latter has not sought clearance
for his separation from the service, will not affect the jurisdiction of respondent Judge to resolve
the complaint of PLAINTIFF. DEFENDANT could still beliable to PLAINTIFF for payment of
the accounts sued for even if he remains an employee of PLAINTIFF.
Jaguar Security and Investigation Agency


Rodolfo Sales, etc.


Jaguar is a private corporation engaged in the business of providing security services; one of their clients is Delta Milling
Industries, Inc. The respondents were hired as security guards by Jaguar and were assigned at the premises of Delta. Later on, the
security guards instituted an instant labor case before the labor arbiter alleging money claims for their services. On July 1, 1999,
petitioner Jaguar filed a partial appeal questioning the failure of public respondent NLRC to resolve its cross-claim against Delta
as the party ultimately liable for payment of the monetary award to the security guards.

Petitioner insists that its cross-claim should have been ruled upon in the labor case as the filing of a cross-claim is allowed under
Section 3 of the NLRC Rules of Procedure which provides for the suppletory application of the Rules of Court. Petitioner argues
that the claim arose out of the transaction or occurrence that is the subject matter of the original action. Petitioner further argues
that as principal, Delta Milling Industries, Inc. (Delta Milling) is liable for the awarded wage increases.

There is no question as regards the respective liabilities of petitioner and Delta Milling. Under Articles 106, 107 and 109 of the
Labor Code, the joint and several liability of the contractor and the principal is mandated to assure compliance of the provisions
therein including the statutory minimum wage. The contractor, petitioner in this case, is made liable by virtue of his status as
direct employer. On the other hand, Delta Milling, as principal, is made the indirect employer of the contractor's employees for
purposes of paying the employees their wages should the contractor be unable to pay them. This joint and several liability
facilitates, if not guarantees, payment of the workers' performance of any work, task, job or project, thus giving the workers
ample protection as mandated by the 1987 Constitution.

Issue: whether petitioner may claim reimbursement from Delta Milling through a cross-claim filed with the labor court?


The jurisdiction of labor courts extends only to cases where an employer-employee relationship exists.

In the present case, there exists no employer-employee relationship between petitioner and Delta Milling. In its cross-claim,
petitioner is not seeking any relief under the Labor Code but merely reimbursement of the monetary benefits claims awarded and
to be paid to the guard employees. There is no labor dispute involved in the cross-claim against Delta Milling. Rather, the cross-
claim involves a civil dispute between petitioner and Delta Milling. Petitioner's cross-claim is within the realm of civil law, and
jurisdiction over it belongs to the regular courts.

Moreover, the liability of Delta Milling to reimburse petitioner will only arise if and when petitioner actually pays its employees
the adjudged liabilities.
LESLIE W. ESPINO, petitioner,




Petitioner Leslie W. Espino was the Exec. Vice President-Chief Operating Officer of respondent Phil Airlines (PAL) when his
service was terminated in 1990 as a result of the findings of the panels created by then President Corazon C. Aquino to
investigate the administrative charges filed against him. It appears that petitioner and other several senior officers of PAL were
charged for their involvement in 4 cases, labeled as “Goldair,” “Robelle,” “Kabash/Primavera,” and “Middle East.”

The PAL Board of Directors issued separate resolutions wherein Espino was considered resign from the service effective
immediately for loss of confidence

Espino filed a complaint for “illegal dismissal” against PAL with the NLRC, Arbitration Branch, NCR.

PAL argued that board resolutions cannot be reviewed by the NLRC and that the recourse of the petitioner Espino should have
been addressed by way of appeal, to the OP.

PAL asserted that the Labor Arbiter’s decision is null and void for lack of jurisdiction over the subject matter as it is the SEC,
and not the NLRC which has jurisdiction over involving dismissal or removal of corporate officers.

NLRC promulgated a resolution and this time ruled in favor of PAL on the ground of lack of jurisdiction

Petitioner Espino contended that it is the NLRC that has jurisdiction over the case as it involves the termination of a regular
employee and involves claim for backwages and other benefits and damages

Issue: Whether the NLRC has jurisdiction over the complaint filed by the petitioner for illegal dismissal

HELD: NO Under P.D. No. 902-A, it is the Securities and Exchange Commission and not the NLRC that has original and
exclusive jurisdiction over cases involving the removal from employment of corporate officers. Under the said decree, the SEC
has the exclusive and original jurisdiction to hear and decide cases involving “Controversies in the election or appointments of
directors, trustees, officers or managers of such corporations, partnerships or associations.”

It has been ruled that a corporate officer’s dismissal is always a corporate act and/or an intra-corporate controversy and that
nature is not altered by the reason or wisdom which the Board of Directors may have in taking such action. Evidently, this intra-
corporate controversy must be place under the specialized competence and expertise of the SEC.

The fact that petitioner sought payment of his backwages, other benefits, as well as damages and attorney's fees in his complaint
for illegal dismissal will not operate to prevent the SEC from exercising its jurisdiction under PD 902-A. As to the contention of
Espino that PAL is estopped from questioning the jurisdiction of the NLRC, it is well-settled that jurisdiction over the subject
matter is conferred by law and the question of lack of jurisdiction may be raised anytime even on appeal.

[G.R. No. 95940, July 24, 1996]

Facts: Private respondent Suñiga was hired by petitioner as a bus conductor, and joined the Pantranco Employees Association-
PTGWO. He continued in petitioner's employ until he retired at the age of fifty-two (52) after having rendered twenty five years'
service. The basis of his retirement was the compulsory retirement provision of the CBA between the petitioner and the
union. Private respondent received P49,300.00 as retirement pay. Suñiga filed a complaint for illegal dismissal against petitioner
with the Sub-Regional Arbitration Branch of the respondent Commission. LA found that the three complainants are illegally and
unjustly dismissed and ordered the respondent to reinstate them to their former or substantially equivalent positions without loss
of seniority rights with full backwages and other benefits.

The amounts already received by complainants shall be considered as advanced payment of their retirement pay which shall be
deducted when they shall actually retire or (be) separated from the service. The order of reinstatement was immediately
executory even pending appeal. Petitioner appealed to public respondent, which issued the questioned Resolution affirming the
labor arbiter's decision in toto.


1. Whether or not the Labor Arbiter has jurisdiction


Jurisdiction of Labor Arbiter

In the instant case, both the union and the company are united or have come to an agreement regarding the dismissal of private
respondents. No grievance between them exists which could be brought to a grievance machinery. The problem or dispute in the
present case is between the union and the company on the one hand and some union and non-union members who were
dismissed, on the other hand. The dispute has to be settled before an impartial body. The grievance machinery with members
designated by the union and the company cannot be expected to be impartial against the dismissed employees. Due process
demands that the dismissed workers’ grievances be ventilated before an impartial body. Since there has already been an actual
termination, the matter falls within the jurisdiction of the Labor Arbiter."

Applying the same rationale to the case at bar, it cannot be said that the "dispute" is between the union and petitioner company
because both have previously agreed upon the provision on "compulsory retirement" as embodied in the CBA. Also, it was only
private respondent on his own who questioned the compulsory retirement. Thus, the case is properly denominated as a
"termination dispute" which comes under the jurisdiction of labor arbiters.

Therefore, public respondent did not commit a grave abuse of discretion in upholding the jurisdiction of the labor arbiter over this
Santos vs Servier


Petitioner Ma. Isabel T. Santos was the Human Resource Manager of respondent Servier Philippines, Inc. since 1991 until her
termination from service in 1999. On March 26 and 27, 1998, petitioner attended a meeting3 of all human resource managers of
respondent, held in Paris, France. Since the last day of the meeting coincided with the graduation of petitioner’s only child, she
arranged for a European vacation with her family right after the meeting. She, thus, filed a vacation leave effective March 30,

As a consequence of petitioner’s termination from employment, respondent offered a retirement package which consists of:

Retirement Plan Benefits: P 1,063,841.76

Insurance Pension at 20,000.00/month for 60 months from company-sponsored group life policy: P 1,200,000.00

Educational assistance: P 465,000.00

Medical and Health Care: P 200,000.0010

Of the promised retirement benefits amounting to P1,063,841.76, only P701,454.89 was released to petitioner’s husband, the
balance11 thereof was withheld allegedly for taxation purposes. Respondent also failed to give the other benefits listed above.12

Petitioner, represented by her husband, instituted the instant case for unpaid salaries; unpaid separation pay; unpaid balance of
retirement package plus interest; insurance pension for permanent disability; educational assistance for her son; medical
assistance; reimbursement of medical and rehabilitation expenses; moral, exemplary, and actual damages, plus attorney’s fees


Whether or not the deduction of taxes falls within the jurisdiction of lobor arbiter.



Records reveal that as early as in petitioner’s position paper filed with the Labor Arbiter, she already raised the legality of said
deduction, albeit designated as "unpaid balance of the retirement package." Petitioner specifically averred that P362,386.87 was
not given to her by respondent as it was allegedly a part of the former’s taxable income.39 This is likewise evident in the Labor
Arbiter and the NLRC’s decisions although they ruled that the issue was beyond the tribunal’s jurisdiction. They even suggested
that petitioner’s claim for illegal deduction could be addressed by filing a tax refund with the Bureau of Internal Revenue.

An employer may terminate the services of an employee who has been found to be suffering from any disease and whose
continued employment is prohibited by law or is prejudicial to his health as well as to the health of his co-employees: Provided,
That he is paid separation pay equivalent to at least one (1) month salary or to one-half (1/2) month salary for every year of
service, whichever is greater, a fraction of at least six (6) months being considered as one (1) whole year.
Sentinel Insurance VS Baustista

The complainants were employees of Sentinel . They were assigned to render guard
duty at the premises of [Philippine American Life Insurance Company] at Jones
Avenue, Cebu City. On December 16, 1993 Philippine American Life Insurance
Company [the Client, for brevity], through Carlos De Pano, Jr., sent notice to all
concerned that the [Agency] was again awarded the contract of [s]ecurity [s]ervices
together with a request to replace all the security guards in the companys offices at
the cities of Cebu, Bacolod, Cagayan de Oro, Dipolog and Ilagan. In compliance
therewith, [the Agency] issued on January 12, 1994, a Relief and Transfer Order
replacing the complainants as guards [of the Client] and for then to be re-assigned
[to] other clients effective January 16, 1994. As ordered, the complainants reported
but were never given new assignments but instead they were told in the
vernacular, gui-ilisa mo kay mga tigulang naman mo which when translated means,
you were replace[d] because you are already old. Precisely, the complainants lost no
time but filed the subject illegal dismissal cases on January 18, January 26 and
February 4, 1994 and prayed for payment of separation pay and other labor standard
Whether or not illegally dismissed by their employer, Sentinel Security Agency, Inc.,
and in holding petitioner to be equally liable therefor.
In the case at bar, the relief and transfer order per se did not sever the employment relationship
between the complainants and the Agency. Thus, despite the fact that complainants were no longer
assigned to the Client, Article 287 of the Labor Code, as amended by RA 7641, still binds the Agency to
provide them upon their reaching the retirement age of sixty to sixty-five years retirement pay or
whatever else was established in the collective bargaining agreement or in any other applicable
employment contract. On the other hand, the Client is not liable to the complainants for their
retirement pay because of the absence of an employer-employee relationship between them.

We agree that the security guards were illegally dismissed, but not for the reasons given by the public
respondent. The aforecited contentions of the NLRC are speculative and unsupported by the evidence
on record. As the solicitor general said in his Manifestation in Lieu of Comment, the relief and transfer
order was akin to placing private respondents on temporary off-detail.
Cagayan de Oro VS MOLE
Cagayan de Oro Coliseum, Inc. is a corporation duly organized and existing under Philippine laws having been issued a
certificate of registration by the Securities and Exchange Commission (SEC) on September 15, 1961.[1] Its principal line of
business is the holding of cockfights and occasional boxing matches.[2] Angel Chaves, on the other hand, is an incorporator and
major stockholder of the corporation who, for sometime, served as its director and officer.

Claiming that he had not been paid for services rendered, Chaves filed on June 3, 1977 a letter complaint with the Field Services
Division of the then Department of Labor, Regional Office No. 10. Consequently, said office investigated the corporation and
found the following: (1) unpaid wages for officers and office personnel; (2) nonpayment of emergency cost of living allowance
(ECOLA) under P.D. No. 525; (3) nonpayment of 13th month pay under P.D. No. 851; and (4) nonpayment of special/regular
holiday pay. The investigation also disclosed that although Atty. Angel Quimpo, general manager of the corporation, had
signified his intention to pay the corporation's obligation to its employees or officers in the amount of P79,773.72 for per diems,
allowances, 13th month pay and others as duly certified to by the corporation's bookkeeper and treasurer, no resolution was
passed by its stockholders or the Board to implement said plan.

is which of the two, the MOLE (now DOLE) and the SEC has jurisdiction over the present controversy


An intracorporate controversy would call for the jurisdiction of the SEC while a labor dispute, that of the NLRC or the MOLE as
the case may be.[10] But when a case is between a stockholder and the corporation of which he holds stocks, the controversy
is intracorporate and well within the jurisdiction of the SEC.[

Finding that the MOLE has no jurisdiction to take cognizance of the herein controversy, there is no need to resolve the other
issues raisedin this petition.


Petitioner union is a legitimate labor organization and individual petitioners are the union's principal officers. The union wrote
respondent company that a great number of the supervisory personnel of respondent's plant had affiliated with it and presented a
set of proposals for incorporation into a collective bargaining agreement. The respondent unheeded the ultimatum letter sent for
union recognition. Thus, the union declared a strike and picketed the company’s premises. Though several conferences were held
at the Iligan City Labor Office between the party’s representatives, there is no good outcome as petitioner alleges that the
company refused to negotiate with it whereas respondent claims in that it is the petitioners who refused to negotiate in good faith.

The petitioners filed an urgent motion to dissolve or lift the writ of preliminary injunction, informing that they were engaged in
an industrial dispute with the respondent company, which is guilty of unfair labor practice in refusing to negotiate with them as
the duly selected bargaining unit, by virtue of which they had struck and picketed the company's premises and therefore
impugning respondent court's jurisdiction to issue the injunction which in effect enjoined their concerted strike and picketing
activities. However, the respondent court denied it on the ground that the case has not filed in the Court of Industrial Relations
and neither filed a notice of strike in the Department of Labor.

Issue: Whether or not the respondent court can enjoin the union strike or picketing.

Whether or not notice of strike is necessary.


: The Court finds merit in the petition.

The Court stressed the exclusive jurisdiction of the industrial court as against the regular courts over unfair labor practices in
Veterans Security Free Workers Union vs. Cloribel 6 thus: "(I)t has long been accepted as dogma that cases involving unfair
labor practice fall within the exclusive jurisdiction of the Court of Industrial Relations, by virtue of the explicit provisions of
Section 5(a) of the Industrial Peace Act that said Court 'shall have jurisdiction over the prevention of unfair labor practices and is
empowered to prevent any person from engaging in any unfair labor practice. This power shall be exclusive and shall not be
affected by any other means of adjustment or prevention that has been or may be established by an agreement, code, law or
otherwise.' The strike and picketing restrained by the questioned orders of respondent judge arose out of unfair labor practice of
respondent company in allegedly refusing to, bargain in good faith and dismissing for union activities the union officials and
members, which are the very subject-matter of the unfair labor charge filed by the union in the Industrial Court. These were facts
expressly alleged by petitioner in its Urgent Motion for Reconsideration, asking respondent judge to set aside the questioned
orders and raising respondent Court's lack of jurisdiction. The very complaint of respondent in the case below, for all its artful
wording, was sufficient on its face to apprise respondent Court that the matter presented before it involved an unfair labor
practice case falling within the Industrial Court's exclusive competence and jurisdiction ... ."



On October 4, 2002, Andrew James McBurnie (McBurnie), an Australian national, instituted a complaint
for illegal dismissal and other monetary claims against Eulalio Ganzon, EGI-Managers, Inc., and E.
Ganzon, Inc., (respondents). McBurnie claimed that on May 11, 1999, he signed a 5-year employment
agreement with the company EGI as an Executive Vice-President who shall oversee the management of
the company hotels and resorts within the Philippines. He performed work for the company until
sometime in November 1999, 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 throug :

The respondents contend that their agreement with McBurnie was to jointly invest in and establish a
company for the management of the 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, and that
McBurnie had not obtained a work permit.

ISSUE: Whether or not McBurnie was illegally dismissed?

Ruling: There was no employer-employee relationship.

McBurnie failed to present any employment permit which would have authorized him to obtain
employment in the Philippines.This circumstance negates McBurnie claim that he had been performing
work for the respondents by virtue of an employer-employee relationship.The absence of the employment
permit instead bolsters the claim that the supposed employment of McBurnie was merely simulated, or
did not ensue due to the non-fulfillment of the conditions that were set forth in the letter of May 11, 1999.

McBurnie failed to present other competent evidence to prove his claim of an employer-employee
relationship. iven the partiesconflicting claims on their true intention in executing the agreement, it was
necessary to resort to the established criteria for the determination of an employer-employee relationship,
namely: (1) the selection and engagement of the employee; (2) the payment of wages; (3) the power of
dismissal; and (4) the power to control the employee conduct. The rule of thumb remains: the onus
probandi falls on the claimant to establish or substantiate the claim by the requisite quantum of
evidence.Whoever claims entitlement to the benefits provided by law should establish his or her right
thereto. McBurnie failed in this regard.As previously observed by the NLRC, McBurnie even failed to
show through any document such as payslips or vouchers that his salaries during the time that he
allegedly worked for the respondents were paid by the company. In the absence of an employer-
employee relationship between McBurnie and the respondents, McBurnie could not successfully claim
that he was dismissed, much less illegally dismissed, by the latter.Even granting that there was such an
employer-employee relationship, the records are barren of any document showing that its termination was
by the respondentsdismissal of McBurnie.



Aris Philippines permanently ceased operations on 9 October 1995 displacing 5,984 rank-and-file employees.
On 26 October 1995, FAPI was incorporated prompting former Aris employees to file a case for illegal dismissal on the
allegations that FAPI was a continuing business of Aris. Sarah Lee Corporation (SLC), Sarah Lee Philippines (SLP) and Cesar
Cruz were impleaded as defendants being major stockholders of FAPI and officers of Aris, respectively.

On 30 October 2004, the Labor Arbiter found the dismissal of 5,984 Aris employees illegal and awarded
them monetary benefits amounting to P3,453,664,710.86. The judgment award is composed of separation pay of one month for
every year of service, back wages, moral and exemplary damages and attorney's fees.

The Corporations filed a Notice of Appeal with Motion to Reduce Appeal Bond. They

posted a P4.5 Million bond. The NLRC granted the reduction of the appeal bond and ordered the Corporations to post an
additional P4.5 Million bond.

The 5,984 former Aris employees, represented by Emilinda Macatlang (Macatlang petition), filed a petition
for review before the Court of Appeals insisting that the appeal was not perfected due to failure of the Corporations to post the
correct amount of the bond which is equivalent to the judgment award.

While the case was pending before the appellate court, the NLRC prematurely issued an order setting aside
the decision of the Labor Arbiter for being procedurally infirmed.

ISSUE:WON the appeal bond of roughly Php 4.5M is enough to perfect an appeal.


NO. The Corporations should have followed the direction of the Court and filed the additional amount requested by the Courts
for the perfection of the appeal so that the NLRC may proceed to try the merits of the case for illegal dismissal. The 10%
requirement pertains to the reasonable amount which the NLRC would accept as the minimum of the bond that should
accompany the motion to reduce bond in order to suspend the period to perfect an appeal under the NLRC rules. The 10% is
based on the judgment award and should in no case be construed as the minimum amount of bond to be posted in order to perfect

Should the NLRC, after considering the merit of the Motion to Reduce Appeal Bond determines that a greater
amount or the full amount of the bond needs to be posted by the appellant, then the party shall comply accordingly. The appellant
shall be given a period of 10 days from notice of the NLRC order within which to perfect the appeal by posting the required
appeal bond.

The Petitioners are then directed to post the amount of PHP 725M in cash or surety bond within 10 days of
the decision to continue with the determination of the merits of the alleged illegally dismissed Respondents through the NLRC.



G.R. No. 152550 June 8, 2005



The Ballad spouses had been employed as overseers of the Borja Estate by its owners, the spouses Manuel Borja and Paula Borja,
since 1972. Their appointment as such was later made in writing per the certification of appointment issued by Paula Borja.

On 10 November 1996, according to the Ballad spouses, when Francisco Borja, brother of the late Manuel Borja, was appointed
the new administrator, he issued immediately a memorandum to all the tenants and lessees of the Borja Estate to transact directly
with him and to pay their monthly rentals to him or to his overseers, the Ballad spouses.

Upon his appointment, Francisco Borja allegedly promised to give the Ballad spouses their food and traveling allowances
aforestated but not the twelve (12) cavans per harvest which he reduced to two (2) cavans per harvest. Francisco Borja also
stopped giving the Ballad spouses their allowances. For twenty-seven (27) years that the Ballad spouses were in the employ of
the Borjas they were purportedly not paid holiday pay, overtime pay, incentive leave pay, premiums and restday pay, 13th month
pay, aside from the underpayment of their basic salary.

In June 1999, the Ballad spouses alleged that Francisco Borja unceremoniously dismissed them and caused this dismissal to be
broadcast over the radio, which caused the former to suffer shock and physical and mental injuries such as social humiliation,
besmirched reputation, wounded feelings, moral anxiety, health deterioration and sleepless nights.

The Court of Appeals observed that petitioners were able to post a bond only on 17 December 1999 in the amount of Forty
Thousand Pesos (P40,000.00) when the same should have been done during the same period of appeal. As this was not done and
as no justifiable reason was given for the late filing, the Court of Appeals ruled that the decision of the Labor Arbiter had become
final and executory.

ISSUE: Whether the appeal is perfected


The appeal bond is required under Article 223 of the Labor Code which provides:

ART. 223. Appeal. - Decisions, awards or orders of the Labor Arbiter are final and executory unless appealed to the Commission
by any or both parties within ten (10) calendar days from receipt of such decisions, awards, or orders

In case of a judgment involving a monetary award, an appeal by the employer may be perfected only upon the posting of a cash
or surety bond issued by a reputable bonding company duly accredited by the Commission, in the amount equivalent to the
monetary award in the judgment appealed from.


FACTS: Felicidad Samson, Casiano A. Osin, Alberto Belbes and Luisito Venus were employees
of CAYCO Marine Service,which is engaged in the business of hauling oil, owned and operated
by Iluminada Cayco OLIZEN. They filed acomplaint against CAYCO and OLIZON for illegal
dismissal, underpayment of wages, non-payment of holiday pay,rest day pay and leave pay.
The labor arbiter dismissed the complaint for lack of merit, but was reversed by the NLRC on
appeal. CAYCO andOLIZON sought reconsideration of the NLRC’s decision but it was denied.
Likewise, on appeal to the SupremeCourt through a petition for certiorari was likewise denied
for failure to establish grave abuse of discretion on the part of NLRC. The decision of the NLRC
became final and executory on April 29, 1997. A writ of execution wasissued directing the
NLRC sheriff to collect from CAYCO and OLIZON the amount computed by the
NLRCResearch and Investigation Unit to be awarded to the complainants. A notice of levy/sale
on execution of personal property was issued and thereafter, on August 8, 1997 the motor tanker
of CAYCO and OLIZEN was seized to besold at public auction.However, Dorotea
TANONGON filed a
third-party claim
before the labor arbiter alleging that she was the owner of the subject motor tanker
for having acquired the same from OLIZEN on July 29, 1997 for a consideration
of 1,100,000. The labor arbiter dismissed such claim for lack of merit. It was found that the
Deed of Absolute Sale wasexecuted on July 29, after the decision became final and executor on
April 29. The sale had been entered into todefraud them.

Whether or not the CA acted with grave abuse of discretion amounting to lack or in excess of
jurisdiction indeciding against TANONGAN
The NLRC ruled that the subject tanker could not be levied upon and sold on execution for
two reasons: (1) the sheriff was acting outside his authority when he levied on properties that were
not unquestionably owned by the judgment debtor; and (2) the sale of the tanker appeared to have
been made to defraud creditors and, therefore, judicial rescission was required.
The CA held, in overruling the NLRC, that the Commission possessed, under Article 224 (a
and b),[16] powers necessary to implement and enforce the latters final judgments, decisions, orders
and awards. The appellate court ruled further that the disputed contract was not merely rescissible;
it was simulated or fictitious and, thus, void ab initio.
We agree with the Court of Appeals. A third-party claim on a levied property does not
automatically prevent execution. Under Rule 39 of the Revised Rules of Court, execution is a
remedy afforded by law for the enforcement of a judgment, its object being to obtain satisfaction
of the decision on which the writ is issued.[17] In executing a money judgment against the property
of the obligor, the sheriff shall levy on all properties belonging to the judgment debtor as is amply
sufficient to satisfy the decision and the costs; and shall sell the same, paying to the judgment
creditor as much of the proceeds as will satisfy the amount of the debt and costs.[18] Sheriffs who
levy upon properties other than those of the judgment debtors are acting beyond the limits of their
Adamson v. CIR

-Adamson and Adamson, Inc. filed this petition to set aside the CIR’s ruling that the Supervisory Union can represent the
supervisory employees Even if it is affiliated with the Federation of Free Workers (FFW) with whom the R&F ee union is also

Adamson argues that the said affiliation violates Sec. 3 of the Industrial Peace Act

ISSUE: Correct interpretation of Sec. 3 of Industrial Peace Act or WON a supervisors’ union may affiliate with a federation with
which unions of r&f ee of the same er are also affiliated


-it is a recognized rule that the right of supervisory ee to organize under the IPA carries restrictions BUT the right itself may not
by denied or unduly abridged. When local unions affiliate, the locals remain the basic units of association, free to serve their own
and common interests subj to restraints imposed by const and by laws

-Hence, notwithstanding affi, local union remain free to serve common interests of membersThe Adamson and Adamson
Supervisory Union and the Adamson and Adamson, Inc., Salesmen Association (FFW), have their own respective constitutions
and by-laws. They are separately and independently registered of each other. Both sent their separate proposals for collective
bargaining agreements with their employer. There could be no employer influence on rank-and-file organizational activities nor
could there be any rank and file influence on the supervisory function of the supervisors because of the representation sought to
be proscribed.

-The confusion seems to have stemmed from the suffix of FFW after the name of the local unions in the registration of both.
Nonetheless, the inclusion of FFW in the registration is merely to stress that they are its affiliates at the time of registrations. It
does not mean that said local unions cannot stand on their own neither can it be construed that their personalities are so merged
with the mother federation that for one difference or another they cannot pursue their own ways, independently of the federation.
This is borne by the fact that FFW, like other federation is a legitimate labor organization separate and distinct from its locals and

Facts: On May 17, 1964, thirty-two (32) out of the thirty-six (36) members of the local union,
LibertyCotton Mills Union, disaffiliated themselves from respondent PAFLU in accordance with
Article X, onUnion Affiliation, of the local union's Constitution and By-Laws.

Respondent PAFLU received the resolution of disaffiliation on May 25, 1964 and immediately
informedthe respondent company on May 27, 1964 that the disaffiliation was null and void and
that it is taking overthe administration of the local union in dealing with the management. Two
days later, on May 29, 1964,PAFLU advised the company that the petitioner workers, who were
among those who signed thedisaffiliation resolution, were expelled from their union membership
in the mother federation because theywere found guilty of acts unbecoming of officers and
members of the union and disloyalty to the motherfederation for instigating union disaffiliation,
and at the same time requested for their dismissal. On May30, 1964, the company terminated the
employment of the petitioner workers pursuant to the Maintenanceof Membership provision of
the Collective Bargaining Agreement.In the 1975 case, the Court's decision, among others,
limited the liability of the respondent company(Liberty Cotton Mills Inc.) to the immediate
reinstatement of the workers (petitioners herein) and directedrespondent PAFLU to pay the
petitioner workers the equivalent of three (3) years backwages withoutdeduction or
qualification.Issue: Whether or not respondent company Liberty Cotton Mills Inc. should be
equally liable with PAFLUfor the payment of backwagesHeld: YesRatio: Respondent company
is equally liable for the payment of backwages for having acted in bad faithin effecting the
dismissal of the individual petitioners. Bad faith on the part of the respondent companymay be
gleaned from the fact that the petitioner workers were dismissed hastily and summarily. At best,
itwas guilty of a tortious act, for which it must assume solidary liability, since it apparently chose
tosummarily dismiss the workers at the union's instance secure in the union's contractual
undertaking thatthe union would hold it "free from any liability" arising from such dismissal.

FACTS: ICMC was one of those accredited by the Philippine Government to operate
the refugee processing center in Morong, Bataan. It was incorporated in New York,
USA, at the request of the Holy See, as a non-profit agency involved in international
humanitarian and voluntary work.
IRRI on the other hand was intended to be an autonomous, philanthropic, tax-free,
non-profit, non-stock organization designed to carry out the principal objective of
conducting “basic research on the rice plant, on all phases of rice production,
management, distribution and utilization with a view to attaining nutritive and
economic advantage or benefit for the people of Asia and other major rice-growing
areas through improvement in quality and quantity of rice.”
The labor organizations in each of the above mentioned agencies filed a petition for
certification election, which was opposed by both, invoking diplomatic immunity.
ISSUE: Are the claim of immunity by the ICMC and the IRRI from the application
of Philippine labor laws valid?
There are basically three propositions underlying the grant of international immunities
to international organizations. These principles, contained in the ILO Memorandum
are stated thus:
1) international institutions should have a status which protects them against control
or interference by any one government in the performance of functions for the
effective discharge of which they are responsible to democratically constituted
international bodies in which all the nations concerned are represented;
2) no country should derive any national financial advantage by levying fiscal charges
on common international funds; and
3) the international organization should, as a collectivity of States members, be
accorded the facilities for the conduct of its official business customarily extended to
each other by its individual member States.
The theory behind all three propositions is said to be essentially institutional in
character. “It is not concerned with the status, dignity or privileges of individuals, but
with the elements of functional independence necessary to free international
institutions from national control and to enable them to discharge their responsibilities
impartially on behalf of all their members. The raison d’etre for these immunities is
the assurance of unimpeded performance of their functions by the agencies concerned
Benjamin Victoriano vs Elizalde Rope Workers’ Union

Benjamin Victoriano, an Iglesia ni Cristo (INC) member, has been an employee of the Elizalde
Rope Factory (ERF) since 1958. He was also a member of the EPWU (Elizalde Rope
Workers’ Union). Under the collective bargaining agreement (CBA) between ERF and EPWU,
a close shop agreement is being enforced which means that employment in the factory relies
on the membership in the EPWU; that in order to retain employment in the said factory one
must be a member of the said Union. In 1962, Victoriano tendered his resignation from EPWU
claiming that as per RA 3350 he is an exemption to the close shop agreement by virtue of his
being a member of the INC because apparently in the INC, one is forbidden from being a
member of any labor union. It was only in 1974 that his resignation from the Union was acted
upon by EPWU which notified ERF about it. ERF then moved to terminate Victoriano due to
his non-membership from the EPWU. EPWU and ERF reiterated that he is not exempt from
the close shop agreement because RA 3350, which provides that close shop agreements
shall not cover members of any religious sects which prohibit affiliation of their members in
any such labor organization, is unconstitutional and that said law violates the EPWU’s and
ERF’s legal/contractual rights.
ISSUE: Whether or not RA 3350 is unconstitutional.
HELD: No. The right to religion prevails over contractual or legal rights. As such, an INC
member may refuse to join a labor union and despite the fact that there is a close shop
agreement in the factory where he was employed, his employment could not be validly
terminated for his non-membership in the majority therein. Further, the right to join a union
includes the right not to join a union. The law is not unconstitutional. It recognizes both the
rights of unions and employers to enforce terms of contracts and at the same time it
recognizes the workers’ right to join or not to join union. RA 3550 recognizes as well the
primacy of a constitutional right over a contractual right.

1984-1987: TUPAS (Kapatiran) was the sole and exclusive collective bargaining representative of the
workers in the Meat and Canning Division of the Universal Robina Corp, with a 3-yr collective bargaining
agreement which was to expire on November 15, 1987

Within the freedom period of 60 days prior to the expiration of its CBA, TUPAS filed an amended notice of
strike as a means of pressuring the company to extend, renew, or negotiate a new CBA with it

The NEW ULO (composed mostly of workers belonging to the INC sect) registered as a labor union

TUPAS staged a strike

ROBINA obtained obtained an injunction against the strike, resulting in an agreement to return to work and for
the parties to negotiate a new CBA

The NEW ULO filed a petition for a certification election at the BLR

TUPAS moved to dismiss the petition

 for being defective in form and

 the members of the NEW ULO were mostly members of INC sect which 3 yrs previous refused to affiliate with
any labor union

 accused company of using the NEW ULO to defeat TUPAS’ bargaining rights

Med-Arbiter ordered the holding of a certification election with 20 days


1. Whether or not the formation of NEW ULO as a labor union was proper


1. YES, because This Court's decision in Victoriano vs. Elizalde Rope Workers' Union, upholding the right of
members of the IGLESIA NI KRISTO sect not to join a labor union for being contrary to their religious
beliefs, does not bar the members of that sect from forming their own union. The public respondent correctly
observed that the "recognition of the tenets of the sect ... should not infringe on the basic right of self-
organization granted by the constitution to workers, regardless of religious affiliation."

Upholding the right of members of the IGLESIA NI KRISTO sect not to join a labor union for being contrary
to their religious beliefs, does not bar the members of that sect from forming their own union. The
"recognition of the tenets of the sect ... should not infringe on the basic right of self-organization granted by
the constitution to workers, regardless of religious affiliation."

A "certification election is the best forum in ascertaining the majority status of the contending unions wherein
the workers themselves can freely choose their bargaining representative thru secret ballot."

It was under the regime of said Industrial Peace Act that the Government Service Insurance
System (GSIS, for short) became bound by a collective bargaining agreement executed
between it and the labor organization representing the majority of its employees, the GSIS
Employees Association. The agreement contained a "maintenance-of-membership"
clause, 5 There appears to be no dispute that at that time, the petitioners occupied supervisory
positions in the GSIS. Pablo Arizala and Sergio Maribao were, respectively, the Chief of the
Accounting Division, and the Chief of the Billing Section of said Division, in the Central Visayas
Regional Office of the GSIS. Leonardo Joven and Felino Bulandus were, respectively, the
Assistant Chief of the Accounting Division (sometimes Acting Chief in the absence of the Chief)
and the Assistant Chief of the Field Service and Non-Life Insurance Division (and Acting
Division Chief in the absence of the Chief), of the same Central Visayas Regional Office of the
GSIS. Demands were made on all four of them to resign from the GSIS Employees Association,
in view of their supervisory positions. They refused to do so. Consequently, two (2) criminal
cases for violation of the Industrial Peace Act were lodged against them in the City Court of
Cebu: one involving Arizala and Maribao 6 and the other, Joven and Bulandus


whether or not the petitioners' criminal liability for a violation of the Industrial Peace Act may be
deemed to have been obliterated in virtue of subsequent legislation and the provisions of the
1973 and 1987 Constitutions.

In other words, the right of Government employees to deal and negotiate with their respective
employers is not quite as extensive as that of private employees. Excluded from negotiation by
government employees are the "terms and conditions of employment ... that are fixed by law," it
being only those terms and conditions not otherwise fixed by law that "may be subject of
negotiation between the duly recognized employees' organizations and appropriate government
authorities," 39 And while EO No. 180 concedes to government employees, like their
counterparts in the private sector, the right to engage in concerted activities, including the right
to strike, the executive order is quick to add that those activities must be exercised in
accordance with law, i.e. are subject both to "Civil Service Law and rules" and "any legislation
that may be enacted by Congress," 40 that "the resolution of complaints, grievances and cases
involving government employees" is not ordinarily left to collective bargaining or other related
concerted activities, but to "Civil Service Law and labor laws and procedures whenever
applicable;" and that in case "any dispute remains unresolved after exhausting all available
remedies under existing laws and procedures, the parties may jointly refer the dispute to the
(Public Sector Labor-Management) Council for appropriate action."41 What is more, the Rules
and Regulations implementing Executive Order No. 180 explicitly provide that since the "terms
and conditions of employment in the government, including any political subdivision or
instrumentality thereof and government-owned and controlled corporations with original charters
are governed by law, the employees therein shall not strike for the purpose of securing changes
thereof. 42
On the matter of limitations on membership in labor unions of government employees,
Executive Order No. 180 declares that "high level employees whose functions are normally
considered as policy making or managerial, or whose duties are of a highly confidential nature
shall not be eligible to join the organization of rank-and-file government employees. 43 A "high
level employee" is one "whose functions are normally considered policy determining,
managerial or one whose duties are highly confidential in nature. A managerial function refers to
the exercise of powers such as: 1. To effectively recommend such managerial actions; 2. To
formulate or execute management policies and decisions; or 3. To hire, transfer, suspend, lay
off, recall, dismiss, assign or discipline employees. 44

FACTS: Petitioner is a union of supervisory employees. It appears that on March 20,

1995 the union filed a petition for certification election on behalf of the route
managers at Pepsi-Cola Products Philippines, Inc. However, its petition was denied by
the med-arbiter and, on appeal, by the Secretary of Labor and Employment, on the
ground that the route managers are managerial employees and, therefore, ineligible for
union membership under the first sentence of Art. 245 of the Labor Code, which
Ineligibility of managerial employees to join any labor organization; right of
supervisory employees. — Managerial employees are not eligible to join, assist or
form any labor organization. Supervisory employees shall not be eligible for
membership in a labor organization of the rank-and-file employees but may join,
assist or form separate labor organizations of their own.

Hence, this petition. Pressing for resolution its contention that the first sentence of
Art. 245 of the Labor Code, so far as it declares managerial employees to be ineligible
to form, assist or join unions, contravenes Art. III, §8 of the Constitution which

The right of the people, including those employed in the public and private sectors, to
form unions, associations, or societies for purposes not contrary to law shall not be

(1) whether the route managers at Pepsi-Cola Products Philippines, Inc. are
managerial employees and
(2) whether Art. 245, insofar as it prohibits managerial employees from forming,
joining or assisting labor unions, violates Art. III, §8 of the Constitution.


As a class, managers constitute three levels of a pyramid: (1) Top management; (2)
Middle Management; and (3) First-line Management [also called supervisors]..

A distinction exists between those who have the authority to devise, implement and
control strategic and operational policies (top and middle managers) and those whose
task is simply to ensure that such policies are carried out by the rank-and-file
employees of an organization (first-level managers/supervisors). What distinguishes
them from the rank-and-file employees is that they act in the interest of the employer
in supervising such rank-and-file employees.

“Managerial employees” may therefore be said to fall into two distinct categories: the
“managers” per se, who compose the former group described above, and the
“supervisors” who form the latter group.

Distinction is evident in the work of the route managers which sets them apart from
supervisors in general. Unlike supervisors who basically merely direct operating
employees in line with set tasks assigned to them, route managers are responsible for
the success of the company’s main line of business through management of their
respective sales teams. Such management necessarily involves the planning, direction,
operation and evaluation of their individual teams and areas which the work of
supervisors does not entail.

The route managers cannot thus possibly be classified as mere supervisors because
their work does not only involve, but goes far beyond, the simple direction or
supervision of operating employees to accomplish objectives set by those above them.
While route managers do not appear to have the power to hire and fire people (the
evidence shows that they only “recommended” or “endorsed” the taking of
disciplinary action against certain employees), this is because thisis a function of the
Human Resources or Personnel Department of the company.

# 2: Constitutionality of Art. 245

Art.245 is the result of the amendment of the Labor Code in 1989 by R.A. No. 6715,
otherwise known as the Herrera-Veloso Law. Unlike the Industrial Peace Act or the
provisions of the Labor Code which it superseded, R.A. No. 6715 provides separate
definitions of the terms “managerial” and “supervisory employees,” as follows:
Art. 212. Definitions. . . .
(m) “managerial employee” is one who is vested with powers or prerogatives to lay
down and execute management policies and/or to hire transfer, suspend, lay off,
recall, discharge, assign or discipline employees. Supervisory employees are those
who, in the interest of the employer, effectively recommend such managerial actions
if the exercise of such authority is not merely routinary or clerical in nature but
requires the use of independent judgment. All employees not falling within any of the
above definitions are considered rank-and-file employees for purposes of this Book.

The distinction between top and middle managers, who set management policy, and
front-line supervisors, who are merely responsible for ensuring that such policies are
carried out by the rank and file, is articulated in the present definition. 30 When read
in relation to this definition in Art. 212(m), it will be seen that Art. 245 faithfully
carries out the intent of the Constitutional Commission in framing Art. III, §8 of the
fundamental law.
*Framer’s Intent: MR. LERUM. My amendment is on Section 7, page 2, line 19,
which is to insert between the words “people” and “to” the following: WHETHER
the section will now read as follows: “The right of the people WHETHER
associations, unions, or societies for purposes not contrary to law shall not be

Nor is the guarantee of organizational right in Art. III, §8 infringed by a ban against
managerial employees forming a union. The right guaranteed in Art. III, §8 is subject
to the condition that its exercise should be for purposes “not contrary to law.” In the
case of Art. 245, there is a rational basis for prohibiting managerial employees from
forming or joining labor organizations.
Philips Industrial Development, Inc. vs NLRC
PIDI is a domestic corporation engaged in the manufacturing and marketing of electronic
products.Since 1971, it had a total of 6 collective bargaining agreements with private respondent
PhilipsEmployees Organization-FFW (PEO-FFW), a registered labor union and the certified
bargaining agent of all rank and file employees of PIDI.- In the first CBA, the supervisors
(referred to in RA 875), confidential employees, security guards,temporary employees and sales
representatives were excluded in the bargaining unit. In the second to thefifth, the sales force,
confidential employees and heads of small units, together with the managerialemployees,
temporary employees and security personnel were excluded from the bargaining unit.
Theconfidential employees are the division secretaries of light/telecom/data and consumer
electronics,marketing managers, secretaries of the corporate planning and business manager,
fiscal and financialsystem manager and audit and EDP manager, and the staff of both the General
Management and thePersonnel Department.- In the sixth CBA, it was agreed that the subject of
inclusion or exclusion of service engineers, sales personnel and confidential employees in the
coverage of the bargaining unit would be submitted for arbitration. The parties failed to agree
on a voluntary arbitrator and the Bureau of Labor Relationsendorsed the petition to the Executive
Labor Arbiter of the NCR for compulsory arbitration.- March 1998, Labor Arbiter:
A referendum will be conducted to determine the will of the serviceengineers and sales
representatives as to their inclusion or exclusion in the bargaining unit. It was alsodeclared that
the Division Secretaries and all staff of general management, personnel and industrialrelations
department, secretaries of audit, EDP, financial system are confidential employees are
deemedexcluded in the bargaining unit.- PEO-FFW appealed to the NLRC; NLRC declared
PIDI's Service Engineers, Sales Force, divisionsecretaries, all Staff of General Management,
Personnel and Industrial Relations Department, Secretariesof Audit, EDP and Financial Systems
are included within the rank and file bargaining unit, citing theImplementing Rules of E.O 111
and Article 245 of the Labor Code (all workers, except managerialemployees and security
personnel, are qualified to join or be a part of the bargaining unit)

Issue:-Whether service engineers, sales representatives and confidential employees of petitioner

are qualified to be part of the existing bargaining unit-

Held: NLRC decision is set aside while the decision of the Executive Labor Arbiter is reinstated.
Confidentialemployees are excluded from the bargaining unit while a referendum will be
conducted to determine thewill of the service engineers and sales representatives as to their
inclusion or exclusion from the bargaining unit, but those who are holding supervisory positions
or functions are ineligible to join a labor organization of the rank and file employees but may
join, assist or form a separate labor organization of their own.Ratio:The exclusion of confidential
employees:The rationale behind the ineligibility of managerial employees to form, assist or join a
labor union equally applies to confidential employees. With the presence of managerial
employees in a union,the union can become company-dominated as their loyalty cannot be
assured. In Golden Farms vs Calleja,the Court states that confidential employees, who have
access to confidential information, may becomethe source of undue advantage.


FACTS:Petitioner Golden Farms, Inc., is a corporation engaged in the production and marketingof
bananas for export. On February 27, 1992, private respondent Progressive Federation ofLabor (PFL)
filed a petition before the Med-Arbiter praying for the holding of a certificationelection among the
monthly paid office and technical rank-and-file employees of petitionerGolden Farms. Petitioner
moved to dismiss claiming that PFL failed to show that it organized achapter within the petitioner
establishment, that there was already an existing CBA betweenthe rank and file employees
represented by NFL and petitioner, and that the employeesrepresented by PFL are disqualified by the
courts.PFL countered that the monthly-paid office workers and technical employees should beallowed
because they were expressly excluded from the coverage of the CBA betweenPetitioner and NFL.
Petitioner argued that the subject employees shoull have joined theexisting CBA if they are not
managerial employees. On April 18,1991, the Med-Arbiter orderedthe conduct of the certification
elections. Petitioner appealed to the Secretary of Labor whichthe LabSec denies the appeal for lack of

ISSUE:WON the Monthly Paid rank and file employee can constitute a bargaining unit separate
fromthe existing bargaining units of its daily-paid rank and file employees

RULING: Wherefore, Petition dismissed for lack of merit.RATIO:Yes, the Monthly Paid office and
technical rank and file employee of the petitioner enjoyconstitutional rights to self organization and
collective bargaining. The duties of the monthlypaid employees primarily administrative and clerical
which is of different nature from daily paidemployees whose main work is the cultivation of bananas.
To be sure, the monthly paid grouphave even been excluded from the bargaining unit of the daily paid
rank and file employees.In the case of UP vs Ferrer-Calleja, the SC sanctioned the formation of 2
separatebargaining units within the establishment. Finally, the SC note that it was Petitioner
companythat filed the motion to dismiss the petition for election violating the general rule that
theemployer has no standing to question a certification election since this is the so that theemployer
has no standing to question a certification election since this is the sole concerns ofthe workers
(Bystander Rule