RATIO
MERALCO V. QUISUMBING
(Martinez J., 1999)
FACTS
Meralco Workers Association (MEWA)
is the duly recognized labor organization
of the rank-and-file employees of
MERALCO.
On September 7, 1995, MEWA informed
MERALCO of its intention to re-
negotiate the terms and conditions of their
existing 1992-1997 CBA covering the
remaining period of two years starting
from December 1, 1995 to November 30,
1997.
Due to failure to arrive at terms and
conditions acceptable to both parties, the
labor dispute was eventually submitted
before the Labor Secretary.
The Labor Secretary finally granted an
arbitral award on December 28, 1996
where it provided for the retroactivity of
the CBA from December 1, 1995 to
November 30, 1997.
MERALCO filed a Petition for Certiorari
before the SC arguing that the CBA
should become effective on the date when
the Labor Secretary resolved the dispute.
ISSUE
WON retroactivity of arbitral awards
shall commence at such time as granted
by the Labor Secretary.
HELD
NO. CBA should be effective for a term
of two years counted from December 28,
1996 (the date of the arbitral award of the
Labor Secretary) up to December 27,
1999.
Article 253-A serves as the guide in
determining when the effectivity of the
CBA is to take effect. It provides that the
representation aspect of the CBA is to be
for a term of 5 years, while “x x x [A]ll
other provisions of the Collective
Bargaining Agreement shall be re-
negotiated not later than 3 years after its
execution. Any agreement on such other
provisions of the Collective Bargaining
Agreement entered into within 6 months
from the date of expiry of the term of such
other provisions as fixed in such
Collective Bargaining Agreement shall
retroact to the day immediately following
such date. If such agreement is entered
into beyond 6 months, the parties shall
agree on the duration of the effectivity
thereof. x x x.”
Under these terms, it is clear that the 5-
year term requirement is specific to the
representation aspect. What the law
additionally requires is that a CBA must
be re-negotiated within 3 years “after its
execution.” It is in this re-negotiation that
gives rise to the present CBA deadlock.
If no agreement is reached within 6
months from the expiry date of the 3 years
that follow the CBA execution, the law
expressly gives the parties - not anybody
else - the discretion to fix the effectivity
of the agreement.
Further, in the absence of an agreement
between the parties, then, an arbitrated
CBA takes on the nature of any judicial or
quasi-judicial award; it operates and may
be executed only respectively unless there
are legal justifications for its retroactive
application.
Significantly, the law does not
specifically cover the situation where 6
months have elapsed but no agreement
has been reached with respect to absence of a CBA, the Secretary’s
effectivity. In this eventuality, any determination of the date of retroactivity
provision of law should then apply for the as part of his discretionary powers over
law abhors a vacuum. arbitral awards shall control.
Wherefore, the arbitral award shall
One such provision is the principle of
retroact from December 1, 1995 to
hold over, i.e., that in the absence of a new
November 30, 1997; and the award of
CBA, the parties must maintain the status
wage is increased from Php1,900 to
quo and must continue in full force and
Php2,000.
effect the terms and conditions of the
existing agreement until a new agreement
is reached. In this manner, the law
prevents the existence of a gap in the
relationship between the collective
bargaining parties

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RULING:
In St. Luke’s Medical vs Torres, a
deadlock developed during CBA
negotiations between management
unions. The Secretary assumed
jurisdiction and ordered the retroaction of
the CBA to the date of expiration of the
previous CBA. The Court ratiocinated
thus: In the absence of a specific provision
of law prohibiting retroactive of the
effectivity of arbitral awards issued by the
Secretary pursuant to article 263(g) of the
Labor Code, public respondent is deemed
vested with the plenary and discretionary
powers to determine the effectivity
thereof.
In general, a CBA negotiated within six
months after the expiration of the existing
CBA retroacts to the day immediately
following such date and if agreed
thereafter, the effectivity depends on the
agreement of the parties. On the other
hand, the law is silent as to the
retroactivity of a CBA arbitral award or
that granted not by virtue of the mutual
agreement of the parties but by
intervention of the government. In the