September 16, 1997
Ponente: Panganiban, J.
FACTS
Prior to the expiration of the then existing CBA between Caltex Refinery Employees Association (CREA) and Caltex Philippines, the two parties sat down to negotiate the terms and conditions of employment to be contained in a new CBA. The two did not meet eye to eye on certain items despite the holding of conciliation meetings by the NCMB, prompting CREA to declare a deadlock and file a notice of, and subsequently stage an actual, strike.
Given the economic significance of the industry to which CREA and Caltex are part of, then SOLE Jose Brillantes assumed jurisdiction over the entire labor dispute. Accordingly, he issued an order to resolve the bargaining deadlock on the following items: wage increase, union security clause, new retirement plan, grievance machinery and arbitration, and signing bonus.
Dissatisfied with the SOLE's order and convinced that he merely adopted Caltex's proposals, CREA filed the present special civil action for certiorari under Rule 65 imputing grave abuse and discretion on the part of the SOLE in resolving the five aforecited items.
RULING
Partly meritorious.
Whether the special civil action for certiorari under Rule 65 filed by CREA is a proper remedy. – YES.
A special civil action for certiorari under Rule 65 of the Revised Rules of Court is an extraordinary remedy. Its use is available only and restrictively in truly exceptional cases -- those wherein the action of an inferior court, board or officer performing judicial or quasi-judicial acts is challenged for being wholly void on grounds of jurisdiction.
What is being sought in the present petition is a judicial re-evaluation of the adequacy or inadequacy of the evidence on record, which is certainly beyond the province of the extraordinary writ of certiorari.
Granted, judicial review by the SC in labor cases does not go so far as to evaluate the sufficiency of the evidence upon which the proper labor officer or office based his or its determination but is limited only to issues of jurisdiction or grave abuse of discretion amounting to lack of jurisdiction.
Note that this decision shall only focus on whether or not the SOLE's order resolving the five contentious items in the CBA amounted to grave abuse of discretion.
Whether the SOLE acted with grave abuse of discretion in resolving the bargaining deadlock on items involving wage increase, union security clause, new retirement plan, grievance machinery and arbitration, and signing bonus. – NO ON WAGE INCREASE, NEW RETIREMENT PLAN, GRIEVANCE MACHINERY AND ARBITRATION, AND SIGNING BONUS, BUT YES ON UNION SECURITY CLAUSE.
WAGE INCREASE
CREA: The Union wanted a 14%, 14%, and 13% increase in wages for the years 1995, 1996, and 1997, respectively. The Union was contending that the proposed increases were proper based on an undocumented claim of 11.8% inflation in September 1995. The Union likewise argued it was only fair for Caltex to agree to the wage increases for the benefit of rank and file employees, given how much the company spent to upgrade its Banaba Housing Facilities for its managers. Finally, the Union was contending that given that Caltex and Shell belong to the same industry, it follows that the former should offer its employees more or less the same amount of compensation as does the latter with its employees.
CALTEX: The company refused to grant the proposed increases, arguing that the said increases were beyond the official inflation rate figures for the year, which at the time was only at 7.496% for the first 10 months of 1995 and projected to be only at 8.5% by December. These were official figures from the Central Bank.
SOLE: Took the position of Caltex.
SC: SOLE did not commit grave abuse of discretion. Caltex's arguments were based on actual figures from the Central Bank, unlike the undocumented inflation rate claim of CREA. With regard to the Banaba Housing Facilities, its upgrading should not be equated with Caltex's financial capacity to pay the proposed wage increase, but should be evaluated as a business judgment.
And finally, with regard to the relative parity of pay between Caltex and Shell, the SC held that this yardstick is illogical and unreasonable. Instead, the true yardstick should be productivity, not sales. As it were, the Court noted that Caltex employees were already the highest paid employees in the Philippines at time, and to agree to the proposed wage increases would only render their wages excessive and disproportionately high for the skills and qualifications needed for the job.
UNION SECURITY CLAUSE
CREA: The Union wanted to amend the existing stipulation on the union security clause (closed shop agreement) by altering the current wording from: "Members of the UNION who cease to be members of the UNION in good standing by reason of resignation or expulsion shall not be retained in the employment of the COMPANY" to "ANY UNION MEMBER WHO CEASES TO BE SUCH MEMBER ON GROUNDS PROVIDED IN ITS CONSTITUTION AND BY-LAWS SHALL x x x BE DISMISSED FROM EMPLOYMENT BY THE COMPANY."
CALTEX: The company refused to agree to the new wording, arguing that the amended provision gives the Union unbridled discretion to expel its members. It was insisting that the Union should only dismiss its members based on three grounds: non-payment of dues, subversion, or conviction for a crime involving moral turpitude.
SOLE: Did nothing. The SOLE said the proposed amendment was merely procedural in character, which was already sufficiently provided under the Union's constitution and by-laws.
SC: By deciding to pass on the issue and failing to provide a valid reason therefor, the SOLE committed grave abuse of discretion. The disagreement between CREA and Caltex on the union security clause should have been definitively resolved by the SOLE.
The labor secretary should take cognizance of an issue which is not merely incidental to but essentially involved in the labor dispute itself, or which is otherwise submitted to him for resolution. The SOLE assumed jurisdiction over this labor dispute in an industry indispensable to national interest, precisely to settle once and for all the disputes over which he has jurisdiction at his level. In not performing his duty, the SOLE committed a grave abuse of discretion.
NEW RETIREMENT PLAN
CREA: The Union was insisting that 40 of its members who were still covered by the old retirement plan should shift to the new retirement plan.
CALTEX The company was arguing that these 40 or so employees have opted to remain covered by the old plan despite opportunities given them in 1985 to shift to the new retirement plan.
SOLE: Sided with Caltex. The SOLE held that the new retirement plan does not apply to the 40 union members who opted to be covered by the old plan.
SC: SOLE did not did not commit grave abuse of discretion in respecting the free and voluntary decision of the employees regarding the provident plan and the irrevocable one-time option provided for in the new retirement plan. Although the Union has every right to represent its members in the negotiation regarding the terms and conditions of their employment, it cannot negate their wishes on matters which are purely personal and individual to them. In this case, the 40 employees freely opted to be covered by the old plan; their decision should be respected. Caltex gave them every opportunity to choose, and they voluntarily exercised their choice. CREA cannot pretend to know better; it cannot impose its will on them.
GRIEVANCE MACHINERY AND ARBITRATION
CREA: The Union was proposing to create a Grievance Settlement Council that would automatically be convened by the VP for Manufacturing in reviewing any grievance elevated to his office. The aim is to ensure that if voluntary arbitration should be resorted to at all, this recourse should entail the least possible expense.
CALTEX: Contended that the existing grievance machinery should be enough. Under the existing terms, the failure of the VP for Manufacturing to resolve any grievance within 7 days upon being brought to his office shall be automatically referred to voluntary arbitration.
SOLE: Sided with Caltex. The SOLE held that the creation of a Grievance Settlement Council is unnecessary; the current procedure should be enough. In fact, the current procedure has been shortened to hasten the resolution process: resolving grievances at the first step is now down to 30 days (from 45 days) and the second step at 7 days (down from 10 days).
SC: SOLE did not commit grave abuse of discretion. To begin with, no particular setup for a grievance machinery is mandated by law. The procedure described by the SOLE sufficiently complies with the minimum requirement of the law.
SIGNING BONUS
CREA: The signing bonus stipulated in the old CBA should not be removed under the principle of maintenance of existing benefits.
CALTEX: The company removed the signing bonus clause. Caltex argued that: (a) the grant of a signing bonus is a matter of discretion and cannot be demanded as a matter of right; and (b) the signing bonus is meant as an incentive for a peaceful negotiation. Caltex held that the second qualification was not met, given the strike staged by CREA during the onset of the negotiations, leading to the SOLE's eventual assumption of jurisdiction over the labor dispute.
SOLE: Sided with Caltex. The SOLE held that the award of signing bonus is not covered by the maintenance of existing benefits clause.
SC: SOLE did not commit grave abuse of discretion. The Court held that a signing bonus may not be demanded as a matter of right. If a igning bonus is not agreed upon by the parties or unilaterally offered as an additional incentive by Caltex, the condition for awarding it must be duly satisfied. In the present case, the condition sine qua non for its grant – that is, no strike – was not complied with.
DOCTRINE
When parties agree to submit unresolved issues
to the SOLE for his resolution, they should not expect their positions
to be adopted in toto. It is understood that they defer to his wisdom
and objectivity in insuring industrial peace. And unless they can
clearly demonstrate bias, arbitrariness, capriciousness or personal
hostility on the part of such public officer, the Court will not
interfere or substitute the said officer’s judgment with its own.
