Albay Electric Cooperative v. (Aleo)
Albay Electric Cooperative, Inc. (ALECO) v. ALECO Labor Employees Organization (ALEO), G.R. No. 241437, September 14, 2020
- Procedural (Remedial Law)
- Labor Law
- assumption of jurisdiction
- Secretary of Labor
- return-to-work order
- backwages
- status quo
- retrenchment
- separation pay
- Article 278 (263) Labor Code
- Rule 65 certiorari
- finality of judgment
- electric cooperative
- private sector participation
I. Facts of the Case
Albay Electric Cooperative, Inc. (ALECO), a financially distressed electric cooperative, and ALECO Labor Employees Organization (ALEO), the collective bargaining agent of its employees, disputed ALECO's rehabilitation scheme (Private Sector Participation) and the retrenchment of its employees. The Secretary of Labor assumed jurisdiction over the resulting strike, upheld the retrenchment, but awarded backwages and CBA-based separation benefits because ALECO did not genuinely comply with the return-to-work order. ALECO questioned the backwages award and the computation before the Court of Appeals and then the Supreme Court.
March 24, 2012
At a Special General Membership Assembly, ALECO's Finance Manager reported financial distress: Php134 million payables to PEMC, Php87 million in unpaid obligations to NGCP, PHILRECA, suppliers, contractors and retirees, and long-term obligations of Php3.1 billion.
To rehabilitate itself, ALECO pushed for Private Sector Participation (PSP). Under PSP, employees would tender courtesy resignations, receive CBA-based separation pay, and have priority in rehiring by the concessionaire. ALEO insisted on a Cooperative-to-Cooperative (C2C) scheme instead.
April 8, 2013
ALEO President Dexter Brutas wrote a letter expressing grievance over the conditions set under the PSP.
April 15, 2013
ALEO sought preventive mediation before NCMB Regional Branch No. 5 for unfair labor practices. The parties failed to settle.
April 25, 2013
ALEO filed a notice of strike. Strike votes were held on May 10, 17 and 20, 2013, and 217 of 235 members voted to strike.
September 14, 2013
In a referendum, PSP was chosen as the rehabilitation measure. San Miguel Power Holdings Corporation had earlier won the public bidding and was awarded the concession.
September 23, 2013
ALEO went on strike.
October 23, 2013
Under Office Memorandum No. 216, ALECO served Notices of Retrenchment on all its employees.
January 7, 2014
ALECO, through Interim Board Resolution No. 2014-003 and a letter signed by Bishop Baylon, asked the Secretary of Labor to assume jurisdiction over the dispute. ALEO concurred.
January 10, 2014
The Secretary of Labor assumed jurisdiction and issued a Return-to-Work Order.
January 14, 2014
ALECO claimed it complied with the Assumption Order by admitting the striking employees. It admitted, however, that no actual work was given and that the employees were confined in a room for over three weeks. The employees refused the tendered salaries because they disagreed on the figures.
April 29, 2016
The Secretary of Labor upheld the validity of the retrenchment. It ordered ALECO to pay backwages and other benefits from January 10, 2014 until finality of the Resolution, plus separation benefits computed under the CBA.
December 2, 2016
The Secretary of Labor denied both parties' motions for partial reconsideration. ALECO filed a Rule 65 petition for certiorari with the Court of Appeals (CA-G.R. SP No. 149409).
January 17, 2018
During execution proceedings, the Secretary of Labor directed execution with modification. Backwages were limited to January 10, 2014 until December 19, 2016, the finality of the December 2, 2016 Resolution. The Secretary approved the sheriff's computation covering 78 employees.
August 10, 2018
The CA affirmed the Secretary of Labor's Resolutions but modified the backwages period to January 10, 2014 up to April 29, 2016. It imposed 6% per annum interest on the monetary awards from finality of its Decision until fully paid.
ALECO filed a Petition for Review on Certiorari before the Supreme Court. It argued that backwages are improper under Manggagawa ng Komunikasyon sa Pilipinas v. PLDT and that computation should run only from when employees actually reported back. It also argued that the base amount was wrong, that three groups of employees were wrongly included, and that disallowing deductions from separation pay usurped legislative authority.
ALEO countered that the backwages are consistent with Article 278 (263) of the Labor Code, that they should run until December 19, 2016, and that the petition is the wrong remedy against the January 17, 2018 Resolution. ALEO also challenged the validity of the retrenchment and the denial of damages and attorney's fees.
II. Issues
Whether ALECO may assail the January 17, 2018 Resolution of the Secretary of Labor through a petition for review on certiorari before the Supreme Court.
Whether ALEO can still challenge the validity of the retrenchment of ALECO's employees and raise anew its claims for damages and attorney's fees.
Whether backwages may be awarded to employees covered by an assumption order even though no illegal dismissal was found, despite Manggagawa ng Komunikasyon sa Pilipinas v. PLDT.
Whether ALECO complied with the Secretary of Labor's Assumption Order and Return-to-Work Order by admitting the striking employees but giving them no work and confining them in a room.
Whether the backwages were properly limited to the period from January 10, 2014 (the Assumption Order) up to April 29, 2016 (the Secretary of Labor's resolution of the dispute).
Whether ALECO's objection that the computation of the monetary award used the wrong base amount warrants modification of the January 17, 2018 Resolution.
Whether ALECO's objection to the inclusion of three groups of employees in the backwages award warrants modification of the January 17, 2018 Resolution.
Whether ALECO's objection to the disallowance of deductions from the separation pay warrants modification of the January 17, 2018 Resolution.
III. Ruling
Whether ALECO may assail the January 17, 2018 Resolution of the Secretary of Labor through a petition for review on certiorari before the Supreme Court.
A petition for review on certiorari is not the proper remedy against the Secretary of Labor's January 17, 2018 Resolution. Such decisions must be challenged by a Rule 65 petition for certiorari before the Court of Appeals.
How the Court reasoned
- ALECO assailed both the CA Decision and the Secretary of Labor's January 17, 2018 Resolution in one Rule 45 petition.
- Decisions of the Secretary of Labor under the Labor Code are administrative or quasi-judicial acts. The long-standing rule is that they are reviewed through a Rule 65 petition for certiorari filed with the CA.
- The January 17, 2018 Resolution was issued during execution proceedings under the Labor Code, so the same rule applies to it.
- ALECO therefore could not directly bring that Resolution to the Supreme Court through the present petition. The Court dealt with the petition only as a review of the CA Decision that tested the Secretary's issuances.
“However, it is a long-standing rule that decisions rendered by the Secretary of Labor under the Labor Code, such as the January 17, 2018 Resolution, must be challenged through a petition for _certiorari_ under Rule 65 before the CA.15”
Rule applied
Rule 65, Rules of Court; settled rule that decisions of the Secretary of Labor under the Labor Code are reviewed by the CA through certiorari
Whether ALEO can still challenge the validity of the retrenchment of ALECO's employees and raise anew its claims for damages and attorney's fees.
ALEO can no longer question the validity of the retrenchment or the denial of damages and attorney's fees. The April 29, 2016 Resolution is already final on those matters.
How the Court reasoned
- The Secretary of Labor's April 29, 2016 Resolution upheld the retrenchment and denied damages and attorney's fees.
- ALEO's motion for partial reconsideration was denied on December 2, 2016, and ALEO did not properly challenge those rulings.
- Under the doctrine of finality of judgment, a decision that has become final can no longer be altered, even if the alteration is meant to correct an error.
- ALEO could not use ALECO's petition to reopen those settled matters or to obtain affirmative relief it did not properly seek.
Rule applied
Doctrine of finality (immutability) of judgments
Whether backwages may be awarded to employees covered by an assumption order even though no illegal dismissal was found, despite Manggagawa ng Komunikasyon sa Pilipinas v. PLDT.
Manggagawa ng Komunikasyon sa Pilipinas v. PLDT does not prohibit backwages outside illegal dismissal cases. Backwages may be awarded to employees covered by an assumption order when the employer fails to comply with it.
How the Court reasoned
- ALECO argued that, under Manggagawa v. PLDT, backwages cannot be awarded absent illegal dismissal.
- The Court read that case as not altogether barring backwages outside illegal dismissal cases.
- Under Article 278 (263) (g), an assumption order automatically enjoins the strike and requires the parties to return to the status quo. This is a separate source of the employer's obligation to employees.
- Backwages here are not a penalty for defying the order, as ALEO had argued. They satisfy the employer's obligation to the employees covered by the order.
- The CA therefore did not err in affirming the award of backwages.
“To be sure, _Manggagawa ng Komunikasyon sa Pilipinas v. PLDT_ does not altogether prohibit the award of backwages outside illegal dismissal cases.”
Rule applied
Article 278 (263) (g) of the Labor Code, as amended; Manggagawa ng Komunikasyon sa Pilipinas v. PLDT, as distinguished
Whether ALECO complied with the Secretary of Labor's Assumption Order and Return-to-Work Order by admitting the striking employees but giving them no work and confining them in a room.
ALECO did not comply with the Assumption Order. Admitting the employees but giving them no work, confining them in a room, and not paying wages is not the actual reinstatement required.
How the Court reasoned
- An assumption or return-to-work order requires the employer to readmit strikers under the same terms and conditions before the strike, which generally means actual reinstatement.
- The status quo to be maintained is the one prevailing the day before the strike, when employees were working and receiving pay.
- ALECO admitted that no actual work was given and that employees were confined in a room for over three weeks.
- The employees' refusal of tendered salaries because of disagreement on figures did not cure the failure to reinstate them to actual work.
- Since ALECO did not truly comply, the award of backwages was proper as satisfaction of its obligation to the employees.
“In consideration of the foregoing, the award of backwages is proper-not as a penalty for non-compliance with the Assumption Order as argued by ALEO-but as satisfaction of ALECO's obligation towards the employees covered by the Assumption Order.”
Rule applied
Article 278 (263) (g) of the Labor Code, as amended (assumption order and status quo)
Whether the backwages were properly limited to the period from January 10, 2014 (the Assumption Order) up to April 29, 2016 (the Secretary of Labor's resolution of the dispute).
The backwages run only from January 10, 2014 until April 29, 2016, when the Secretary of Labor resolved the dispute. The CA correctly limited the period and rejected ALECO's attempt to start it later and ALEO's attempt to extend it to December 19, 2016.
How the Court reasoned
- The assumption order operates from its issuance on January 10, 2014 and lasts until the Secretary resolves the labor dispute.
- The Secretary resolved the dispute on April 29, 2016, which ended the period during which the status quo had to be maintained.
- Backwages cannot run until the finality of the December 2, 2016 Resolution, as the Secretary's January 17, 2018 Resolution had set it, because the obligation to maintain the status quo ended with the resolution of the dispute.
- ALECO's argument that computation should start only when employees actually reported back fails, because ALECO's own non-compliance kept the employees from actual work.
- The CA therefore correctly reduced the period to January 10, 2014 up to April 29, 2016.
“The status _quo_ to be maintained under Article 278 263 of the Labor Code refers to that which was prevailing the day before the strike.”
Rule applied
Article 278 (263) (g) of the Labor Code, as amended; status quo ante rule
Whether ALECO's objection that the computation of the monetary award used the wrong base amount warrants modification of the January 17, 2018 Resolution.
ALECO's objection to the base amount used in computing the award did not warrant modifying the Resolution. The challenge was raised through the wrong remedy, and the CA's affirmance of the award stands.
How the Court reasoned
- The computation of the monetary award was set in the Secretary of Labor's January 17, 2018 Resolution, which ALECO could not directly challenge by Rule 45.
- The Court found that the CA did not err in affirming the award of backwages.
- ALECO's objection to the base amount therefore did not overcome the affirmed computation.
Rule applied
Rule 65, Rules of Court; Article 278 (263) (g) of the Labor Code
Whether ALECO's objection to the inclusion of three groups of employees in the backwages award warrants modification of the January 17, 2018 Resolution.
ALECO's objection to including three groups of employees in the backwages award did not warrant modifying the Resolution. The award covering the employees under the Assumption Order stands.
How the Court reasoned
- The inclusion of the employees was decided in the January 17, 2018 Resolution, which was not properly challenged through Rule 65.
- The Assumption Order covered the employees affected by the labor dispute, and the backwages satisfy ALECO's obligation to those employees.
- ALECO's objection did not show reversible error in the CA's affirmance.
Rule applied
Rule 65, Rules of Court; Article 278 (263) (g) of the Labor Code
Whether ALECO's objection to the disallowance of deductions from the separation pay warrants modification of the January 17, 2018 Resolution.
ALECO's objection to the disallowance of deductions from separation pay did not warrant modifying the Resolution. The CA's affirmance of the Secretary of Labor's ruling stands.
How the Court reasoned
- The disallowance of deductions was part of the January 17, 2018 Resolution, which ALECO could not challenge through the present Rule 45 petition.
- The separation benefits were computed under the CBA and fixed in the Secretary's final April 29, 2016 Resolution.
- The Court found no reversible error in the CA's affirmance, so ALECO's claim of usurped legislative authority did not prosper.
Rule applied
Rule 65, Rules of Court; Article 278 (263) (g) of the Labor Code
Doctrines
Decisions of the Secretary of Labor under the Labor Code must be challenged through a Rule 65 petition for certiorari before the Court of Appeals, not directly by a petition for review before the Supreme Court.
Manggagawa ng Komunikasyon sa Pilipinas v. PLDT does not altogether prohibit backwages outside illegal dismissal cases. Backwages may be awarded to employees covered by an assumption order as satisfaction of the employer's obligation to them, not as a penalty.
The status quo to be maintained under Article 278 (263) of the Labor Code is the one prevailing the day before the strike. It must be kept from the issuance of the assumption order until the Secretary of Labor resolves the dispute, and generally requires actual reinstatement.
Merely admitting strikers but giving them no work, confining them in a room and withholding wages is not compliance with an assumption or return-to-work order.
Under the doctrine of finality of judgment, matters already settled in a final resolution, such as the validity of the retrenchment and the denial of damages and attorney's fees, can no longer be reopened.
Final Disposition
WHEREFORE, the Petition for Review on Certiorari is DENIED. The Decision dated August 10, 2018 of the Court of Appeals in CA-G.R. SP No. 149409, which affirmed the Secretary of Labor's Resolutions in OS-VA-2014-01 and limited the backwages to the period from January 10, 2014 up to April 29, 2016, is AFFIRMED. SO ORDERED.
Notes
The extracted portions of the decision did not set out the Court's detailed discussion of the base amount, the three groups of employees and the deductions from separation pay. The rulings on issues 6 to 8 are inferred from the Court's affirmance of the CA Decision and its holding that the petition is the wrong remedy against the January 17, 2018 Resolution. The final disposition is reconstructed from that outcome rather than quoted.