ASG Law

Tag: Article 264 Labor Code

  • Strike Illegality and Termination: When Prior NLRC Findings Suffice

    The Supreme Court ruled that an employer can legally terminate employees who commit illegal acts during a strike, even without a separate petition declaring the strike illegal, if a prior National Labor Relations Commission (NLRC) decision already established the illegality of those acts. This decision emphasizes that employers can act on prior NLRC findings to protect their operations from unlawful obstruction during labor disputes.

    Union’s Picket or Employer’s Prerogative: Striking a Balance in Labor Disputes

    This case arose from a labor dispute between Jackbilt Industries, Inc. (petitioner) and its employees’ union, Jackbilt Employees Workers Union-NAFLU-KMU (respondent). In 1998, due to economic difficulties, Jackbilt temporarily halted its concrete hollow block production, leading to a strike by the union, which alleged anti-union motivations. During the strike, union members obstructed access to Jackbilt’s premises. Jackbilt filed a petition for injunction with the NLRC, which issued a Temporary Restraining Order (TRO) against the union. However, the union continued to obstruct entry and exit, leading the NLRC to issue a writ of preliminary injunction and subsequently a decision finding the union guilty of obstructing free access. Following this, Jackbilt terminated the officers and members of the union who participated in the strike. The union then filed complaints for illegal lockout, unfair labor practice, and illegal dismissal.

    The Labor Arbiter initially dismissed the complaints for illegal lockout and unfair labor practice but found Jackbilt guilty of illegal dismissal, arguing that the company should have filed a petition to declare the strike illegal before terminating the employees. The NLRC modified this decision, holding only Jackbilt liable for the monetary awards. The Court of Appeals (CA) further modified the NLRC decision, finding Jackbilt guilty of unfair labor practice and ordering the payment of backwages and separation pay. The CA reasoned that the temporary shutdown was motivated by anti-union sentiments. Jackbilt then elevated the case to the Supreme Court, questioning whether filing a petition to declare a strike illegal is a prerequisite for validly terminating employees who committed illegal acts during the strike.

    The Supreme Court anchored its decision on the principle of conclusiveness of judgment, as outlined in Section 47(c), Rule 39 of the Rules of Court. This principle dictates that parties are bound by findings in a previous judgment regarding matters actually raised and adjudged. The Court highlighted that Article 264(e) of the Labor Code explicitly prohibits obstructing free ingress to and egress from an employer’s premises during picketing.

    Article 264(e) of the Labor Code prohibits any person engaged in picketing from obstructing the free ingress to and egress from the employer’s premises.

    Since the NLRC had already determined in its July 17, 1998 decision that the union obstructed access to Jackbilt’s facility, the Supreme Court held that the union members had committed illegal acts during the strike. This prior determination was crucial.

    The Court emphasized that the use of unlawful means during a strike renders it illegal. Because the NLRC had already established the illegality of the union’s actions, the Supreme Court concluded that the March 9, 1998 strike was ipso facto illegal, making a separate petition to declare it so unnecessary. This point is critical in understanding the Court’s rationale. The prior finding of illegal acts served as sufficient basis for the subsequent dismissals.

    Furthermore, the Supreme Court cited Article 264 of the Labor Code, which allows an employer to terminate employees who commit illegal acts during a strike. This provision provides the legal basis for the employer’s action. The Court acknowledged that while the Labor Code uses the word “may,” granting the employer discretion, Jackbilt was within its rights to terminate the employees given the NLRC’s prior finding of illegal acts.

    Article 264 of the Labor Code further provides that an employer may terminate employees found to have committed illegal acts in the course of a strike.

    The Supreme Court reversed the CA’s decision, effectively upholding the legality of the dismissals. This decision underscores the importance of adhering to legal procedures during strikes and the consequences of engaging in unlawful activities, such as obstructing access to company premises. The ruling also clarifies that employers can rely on prior NLRC findings to justify disciplinary actions against employees who violate labor laws during strikes.

    In essence, the Supreme Court’s decision underscores the delicate balance between the rights of workers to strike and the rights of employers to protect their property and business operations. By affirming Jackbilt’s right to terminate employees who engaged in illegal acts during the strike, the Court reinforced the principle that strikes must be conducted within the bounds of the law.

    FAQs

    What was the key issue in this case? The central issue was whether an employer must file a separate petition to declare a strike illegal before terminating employees who committed illegal acts during that strike, especially when the illegality of those acts had already been established by the NLRC.
    What did the Supreme Court decide? The Supreme Court ruled that a separate petition to declare the strike illegal was unnecessary because the NLRC had already found that the union committed illegal acts during the strike. Therefore, the employer was justified in terminating the employees.
    What is the principle of conclusiveness of judgment? The principle of conclusiveness of judgment, as embodied in Section 47(c), Rule 39 of the Rules of Court, states that parties are bound by the findings in a previous judgment regarding matters actually raised and adjudged. This means that if an issue has been decided in a prior case, it cannot be relitigated in a subsequent case between the same parties.
    What are some examples of illegal acts during a strike? Illegal acts during a strike can include violence, coercion, intimidation, and obstructing free ingress to or egress from the employer’s premises. In this case, the obstruction of access to Jackbilt’s facility was the primary illegal act.
    What does the Labor Code say about terminating employees who participate in illegal strikes? Article 264 of the Labor Code allows an employer to terminate employees who knowingly participate in the commission of illegal acts during a strike. However, mere participation in a lawful strike is not sufficient grounds for termination.
    What was the basis for the Court of Appeals’ decision? The Court of Appeals found Jackbilt guilty of unfair labor practice, reasoning that the temporary shutdown was motivated by anti-union sentiments. They ordered the payment of backwages and separation pay to the dismissed employees.
    Why did the Supreme Court reverse the Court of Appeals’ decision? The Supreme Court reversed the Court of Appeals’ decision because it found that the NLRC had already determined that the union committed illegal acts during the strike, justifying the employer’s decision to terminate the employees. The Court emphasized that the prior finding of illegal acts served as sufficient basis for the dismissals.
    What is the significance of Article 264(e) of the Labor Code in this case? Article 264(e) of the Labor Code is significant because it prohibits any person engaged in picketing from obstructing the free ingress to or egress from the employer’s premises. This provision was the basis for the NLRC’s finding that the union committed illegal acts during the strike.

    This case clarifies the circumstances under which an employer can terminate employees for illegal acts committed during a strike without first obtaining a formal declaration of illegality of the strike itself. The ruling emphasizes the importance of respecting legal boundaries during labor disputes.

    For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

    Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
    Source: Jackbilt Industries, Inc. vs. Jackbilt Employees Workers Union-NAFLU-KMU, G.R. Nos. 171618-19, March 13, 2009

  • Illegal Strikes in the Philippines: Understanding Consequences and Return-to-Work Orders

    When Strikes Backfire: The High Cost of Illegal Work Stoppages in the Philippines

    TLDR: This case underscores that strikes in the Philippines must be based on legitimate labor disputes and comply with legal procedures, including return-to-work orders. Workers who participate in illegal strikes, especially union leaders, risk losing their jobs. Employers have the right to seek legal remedies against illegal strikes to maintain business operations.

    PASVIL/PASCUAL LINER, INC., WORKERS UNION – NAFLU vs. NATIONAL LABOR RELATIONS COMMISSION, G.R. No. 124823, July 28, 1999

    INTRODUCTION

    Imagine commuters stranded, businesses disrupted, and livelihoods jeopardized – this is the potential fallout of a strike, a powerful tool in labor disputes. In the Philippines, the right to strike is constitutionally protected, but it’s not without limits. The Supreme Court case of PASVIL/Pascual Liner, Inc., Workers Union – NAFLU vs. NLRC highlights the critical distinction between legal and illegal strikes, emphasizing the severe consequences for workers who disregard the rules. This case revolves around a union strike that, despite its initial grievances, was ultimately declared illegal, leading to the dismissal of its leaders. The central legal question: Was the strike legal, and did the National Labor Relations Commission (NLRC) have the authority to declare it illegal?

    LEGAL CONTEXT: STRIKES, JURISDICTION, AND RETURN-TO-WORK ORDERS

    Philippine labor law recognizes strikes as a legitimate means for workers to advocate for better terms and conditions of employment. However, this right is not absolute. A strike must be based on a valid “labor dispute,” typically involving unfair labor practices or bargaining deadlocks. Crucially, the law outlines specific procedures for legal strikes, including filing a notice of strike and observing mandatory cooling-off periods.

    Article 263 of the Labor Code governs strikes, picketing, and lockouts. It states, “(g) 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 or certify the same to the Commission for compulsory arbitration.” This provision grants the Secretary of Labor broad powers to intervene in disputes that could impact national interest, such as transportation, as seen in the PASVIL case. Assumption of jurisdiction or certification to compulsory arbitration automatically enjoins any ongoing or intended strike.

    Furthermore, Article 264 of the Labor Code details the consequences of illegal strikes, stipulating that “(a) Any union officer who knowingly participates in an illegal strike and any worker or employee who knowingly participates in a strike declared under Article 263(g) of this Code shall be penalized with dismissal from employment…” This highlights the severe repercussions for union leaders and members involved in illegal strikes, including potential job loss.

    Jurisdiction over labor disputes is generally vested in Labor Arbiters under Article 217 of the Labor Code, which grants them “original and exclusive jurisdiction to hear and decide… cases arising from any violation of Article 264 of this Code, including questions on the legality of strikes and lock-outs…” However, as Article 217 itself states, this is “Except as otherwise provided under this Code.” The exception, as clarified in the landmark case of International Pharmaceuticals, Inc. v. Secretary of Labor and Employment, is Article 263(g). When the Secretary of Labor assumes jurisdiction, it encompasses all aspects of the labor dispute, including the legality of the strike, even matters typically under the Labor Arbiter’s purview.

    The Philippine Airlines, Inc. v. Secretary of Labor and Employment case initially seemed to limit the Secretary’s jurisdiction to the specific issues submitted for resolution, excluding the legality of the strike unless explicitly stated. However, PASVIL distinguishes itself from Philippine Airlines, clarifying that if the certification to the NLRC explicitly includes the ongoing strike as part of the dispute, then the NLRC, by extension, has the authority to rule on its legality.

    CASE BREAKDOWN: THE PASVIL LINER STRIKE

    The PASVIL/Pascual Liner, Inc., Workers Union – NAFLU (UNION) filed a notice of strike against PASVIL/Pascual Liner, Inc. (PASVIL) citing unfair labor practices: union busting, discrimination, and discouraging union membership. The National Conciliation and Mediation Board (NCMB) noted the real issues were the dismissal of the Union President and a pending certification election, deemed inappropriate for a strike but suitable for preventive mediation. Conciliation efforts failed, and the UNION proceeded with a strike.

    Secretary of Labor Ma. Nieves R. Confesor intervened, assuming jurisdiction and certifying the dispute to the NLRC due to the essential nature of PASVIL’s transportation services. She ordered the striking workers back to work within 24 hours and PASVIL to accept them under previous terms. This “return-to-work order” was published in newspapers.

    Despite the order, the UNION continued picketing, preventing other workers from reporting. Secretary Confesor reiterated the return-to-work order and deputized police to ensure compliance and remove barricades. The NLRC scheduled conciliation conferences, but only PASVIL attended. The NLRC then directed both parties to submit position papers.

    PASVIL sought early resolution due to ongoing strike losses. Hearings were set, but the UNION representatives were often absent. Despite the UNION’s motion for a formal trial, the NLRC, believing it was a delaying tactic and sufficient evidence existed, denied the motion. The NLRC then ruled on the strike’s legality based on the submitted documents.

    The UNION claimed the strike was due to unfair labor practices: the removal of 24 buses affecting jobs and the alleged illegal dismissal of their president. PASVIL countered that the buses were sold to pay debts and the president was dismissed for neglect of duty.

    The NLRC declared the strike illegal and deemed the 19 petitioning union officers to have lost their employment. The NLRC reasoned that even without the 24 buses, enough remained for operations, and PASVIL had urged workers to return. The NLRC also noted the UNION failed to specify wage or working condition grievances that justified a strike. Regarding the dismissed union president, a Labor Arbiter had already ruled his dismissal justified.

    The NLRC emphasized the strikers’ defiance of the return-to-work order as a key factor in declaring the strike illegal. The Supreme Court upheld the NLRC’s decision, stating:

    “In the same manner, when the Secretary of Labor and Employment certifies the labor dispute to the NLRC for compulsory arbitration the latter is concomitantly empowered to resolve all questions and controversies arising therefrom including cases otherwise belonging originally and exclusively to the Labor Arbiter.”

    The Court also affirmed the NLRC’s denial of a formal trial, finding no grave abuse of discretion as the NLRC had sufficient evidence to decide the case based on the submitted position papers and documents. The Court highlighted the UNION’s failure to present sufficient evidence of unfair labor practices or justify their strike. The Court noted PASVIL’s evidence of remaining buses and the NCMB’s ocular inspection supporting the company’s claim that work was available. Crucially, the Supreme Court underscored the UNION’s defiance of the return-to-work order, stating that this alone contributed to the strike’s illegality and the subsequent loss of employment for the union officers.

    PRACTICAL IMPLICATIONS: STRIKE RESPONSIBLY, RETURN WHEN ORDERED

    The PASVIL case serves as a stark warning to unions and workers in the Philippines. While the right to strike is protected, it must be exercised responsibly and within legal boundaries. Initiating or continuing a strike without a valid labor dispute or in defiance of a return-to-work order can have devastating consequences, including job loss for participating union officers and potential disciplinary actions for members.

    For employers, this case reinforces their right to seek legal intervention, including return-to-work orders, when strikes threaten essential services or national interest. It also highlights the importance of documenting and presenting evidence to the NLRC to demonstrate the illegality of a strike and the union’s non-compliance with legal directives.

    Key Lessons:

    • Legal Grounds for Strikes are Essential: Strikes must be based on legitimate unfair labor practices or bargaining impasses, not on issues resolvable through preventive mediation or grievances already under arbitration.
    • Return-to-Work Orders Must Be Obeyed: Orders from the Secretary of Labor or NLRC to return to work are legally binding. Defiance constitutes an illegal act with severe penalties.
    • Union Leaders Bear Higher Responsibility: Union officers who lead illegal strikes face the gravest consequences, including dismissal from employment.
    • Evidence is Crucial: Both unions and employers must diligently gather and present evidence to support their positions before the NLRC.
    • NLRC Jurisdiction Expands with Certification: When the Secretary of Labor certifies a dispute to the NLRC, the NLRC’s authority extends to all related issues, including strike legality.

    FREQUENTLY ASKED QUESTIONS (FAQs)

    Q: What makes a strike illegal in the Philippines?

    A: Strikes can be declared illegal for various reasons, including being conducted for non-labor related issues, failure to comply with procedural requirements like strike notices and cooling-off periods, commission of prohibited activities during a strike, or defiance of a valid return-to-work order from the Secretary of Labor or NLRC.

    Q: What is a return-to-work order?

    A: A return-to-work order is issued by the Secretary of Labor and Employment or the NLRC, typically when a strike affects national interest. It legally compels striking workers to resume their jobs immediately while the labor dispute is being resolved through compulsory arbitration.

    Q: What happens if workers defy a return-to-work order?

    A: Defying a return-to-work order is considered an illegal act. Union officers who participate in or lead such defiance can be dismissed from employment. Other participating employees may also face disciplinary actions.

    Q: Can a strike be legal even if the union’s allegations of unfair labor practice are later proven untrue?

    A: In some cases, yes. If a union genuinely and in good faith believes that unfair labor practices have been committed, a strike may be considered legal even if those allegations are later disproven. However, “good faith” is a difficult defense to maintain if evidence contradicts the union’s claims, as seen in the PASVIL case.

    Q: Does the NLRC have the power to declare a strike illegal?

    A: Yes, especially when the Secretary of Labor certifies a labor dispute to the NLRC for compulsory arbitration. In such cases, the NLRC’s jurisdiction extends to resolving all issues related to the dispute, including the legality of the strike.

    Q: What should unions do before declaring a strike to ensure legality?

    A: Unions should ensure they have valid grounds for a strike (unfair labor practice or bargaining deadlock), file a strike notice with the NCMB, observe cooling-off periods, conduct strike votes, and continuously engage in good-faith bargaining. Legal counsel should be consulted throughout the process.

    Q: What recourse does an employer have if faced with an illegal strike?

    A: Employers can petition the Secretary of Labor to assume jurisdiction or certify the dispute to the NLRC. They can also seek injunctions to stop illegal picketing and pursue disciplinary actions, including dismissal, against union officers and employees participating in illegal strikes.

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