Strikes and Dismissal: Understanding When Philippine Employers Can Terminate Striking Employees

TLDR; In the Philippines, employees participating in illegal strikes, especially in vital industries, risk termination. This case clarifies the circumstances under which a strike is deemed illegal, emphasizing compliance with return-to-work orders and adherence to grievance procedures. Ignoring these rules can lead to dismissal.

G.R. NO. 144315, July 17, 2006

Introduction

Imagine a company crippled by a strike, its operations grinding to a halt. Now, consider the employees who believe they are fighting for their rights, unaware that their actions could cost them their jobs. This scenario plays out frequently in labor disputes, highlighting the delicate balance between workers’ rights and employers’ prerogatives. The Supreme Court case of PHILCOM EMPLOYEES UNION vs. PHILIPPINE GLOBAL COMMUNICATIONS AND PHILCOM CORPORATION sheds light on when an employer can legally dismiss striking employees in the Philippines.

This case revolves around a labor dispute that escalated into a strike, prompting the Secretary of Labor and Employment to assume jurisdiction. The central legal question is whether the strike was legal, and if not, what consequences the striking employees would face. The ruling underscores the significance of adhering to legal protocols during labor actions, particularly in industries vital to the national interest.

Legal Context: Strikes, Unfair Labor Practices, and the Law

In the Philippines, the right to strike is constitutionally recognized, but it is not absolute. The Labor Code and related regulations set specific conditions and limitations on this right. Understanding these legal principles is crucial for both employers and employees to navigate labor disputes lawfully.

Key Legal Principles:

• Right to Strike: Employees have the right to strike to address grievances or demand better working conditions.
• Limitations: This right is limited by laws and regulations, especially in industries vital to the national interest.
• Unfair Labor Practices (ULP): Employers are prohibited from committing acts that interfere with employees’ right to self-organization.
• Grievance Machinery: Collective Bargaining Agreements (CBAs) typically outline procedures for resolving disputes.

Article 263(g) of the Labor Code empowers the Secretary of Labor and Employment to assume jurisdiction over labor disputes that could impact national interest. This assumption automatically enjoins any impending strike or lockout.

The relevant provision states:

“When, in his opinion, there exists a labor dispute causing or likely to cause a strike or lockout in an industry indispensable to the national interest, the Secretary of Labor and Employment may assume jurisdiction over the dispute and decide it… Such assumption or certification shall have the effect of automatically enjoining the intended or impending strike or lockout…”

Article 264 of the Labor Code outlines prohibited activities during strikes, including violence, coercion, intimidation, and obstruction of free passage to and from the employer’s premises. Violations can lead to the loss of employment status.

Case Breakdown: PHILCOM Employees Union vs. Philippine Global Communications

The PHILCOM Employees Union (PEU) and Philippine Global Communications (Philcom) were engaged in CBA negotiations. When negotiations stalled, PEU filed two notices of strike with the National Conciliation and Mediation Board (NCMB). While conciliation meetings were ongoing, PEU staged a strike, barricading company entrances and setting up picket lines.

Philcom petitioned the Secretary of Labor and Employment to assume jurisdiction, which was granted. The Secretary issued return-to-work orders, but the striking employees defied them. Philcom then dismissed the employees for abandonment of work.

The case journeyed through the following stages:

1. Secretary of Labor and Employment: Assumed jurisdiction, dismissed ULP charges, and ordered employees to return to work.
2. Court of Appeals: Affirmed the Secretary’s orders, upholding the dismissal of ULP charges and recognizing the legality of the Secretary’s actions.
3. Supreme Court: Reviewed the case to determine the legality of the strike and the validity of the dismissals.

The Supreme Court emphasized the Secretary’s broad discretion in resolving labor disputes affecting national interest. The Court quoted:

“The authority of the Secretary to assume jurisdiction over a labor dispute causing or likely to cause a strike or lockout in an industry indispensable to national interest includes and extends to all questions and controversies arising from such labor dispute. The power is plenary and discretionary in nature to enable him to effectively and efficiently dispose of the dispute.”

The Court also highlighted the consequences of defying return-to-work orders:

“A strike undertaken despite the Secretary’s issuance of an assumption or certification order becomes a prohibited activity, and thus, illegal… The union officers who knowingly participate in the illegal strike are deemed to have lost their employment status.”

Ultimately, the Supreme Court ruled that the strike was illegal due to several factors:

• Philcom operated in a vital industry protected from strikes.
• The strike occurred after the Secretary assumed jurisdiction.
• The employees defied return-to-work orders.
• The strike involved unlawful means, such as obstructing company entrances.
• The strike was declared during pending mediation proceedings.
• The strike disregarded the grievance procedure established in the CBA.

Practical Implications: Navigating Labor Disputes

This ruling serves as a stark reminder to unions and employees about the importance of following legal procedures during labor disputes. Defying return-to-work orders or engaging in unlawful strike activities can have severe consequences, including termination. For employers, it reinforces the need to act within the bounds of the law and to respect employees’ rights while safeguarding business operations.

Key Lessons:

• Comply with Return-to-Work Orders: Immediately return to work when ordered by the Secretary of Labor.
• Avoid Unlawful Strike Activities: Refrain from violence, coercion, or obstruction of company premises.
• Follow Grievance Procedures: Exhaust all available grievance mechanisms before resorting to a strike.
• Know Your Industry: Be aware of whether your industry is considered vital, as strikes in such industries are heavily regulated.

Frequently Asked Questions

Q: What makes a strike illegal in the Philippines?

A: A strike can be deemed illegal if it violates specific provisions of the Labor Code, such as occurring in a vital industry, defying return-to-work orders, involving unlawful means, or being declared during pending mediation.

Q: What is a return-to-work order, and what happens if I don’t comply?

A: A return-to-work order is issued by the Secretary of Labor, directing striking employees to resume their jobs. Failure to comply can result in dismissal.

Q: Can I be dismissed for participating in a legal strike?

A: Mere participation in a lawful strike is not sufficient grounds for termination. However, committing illegal acts during a strike can lead to dismissal.

Q: What should I do if I believe my employer is committing unfair labor practices?

A: Document the alleged ULP, consult with a labor union or lawyer, and file a complaint with the appropriate government agency.

Q: What is the role of the NCMB in labor disputes?

A: The NCMB provides conciliation and mediation services to help resolve labor disputes and prevent strikes or lockouts.

Q: What industries are considered vital in the Philippines?

A: Vital industries include public utilities (transportation, communications), hospitals, and other sectors essential to national interest.

ASG Law specializes in labor law and dispute resolution. Contact us or email hello@asglawpartners.com to schedule a consultation.