UNION OF FILIPRO EMPLOYEES (UFE), MANUEL L. SARMIENTO, BENJAMIN M. ALTAREJOS, RODOLFO D. PAGLINAWAN, CARMELITA G. NUQUI, CORAZON Y SAZON, RODRIGO P. LUCAS, RUDOLPH C. ARMAS, EDUARDO A. ABELLA, ANGEL A. CANETE, JUANITO T. CAPILI, ADOLFO S. CASTILLO, JR., PONCIANO A. CARINGAL, ERIBERTO S. LEONARDO, ADELAIDA B. MIRA, EUGE
Union of Filipro Employees (UFE) v. Nestlé Philippines, Inc., G.R. Nos. 88710-13, December 19, 1990
- Political Law
- Labor Law
- illegal strike
- assumption of jurisdiction
- return-to-work order
- no strike/no lockout clause
- cooling-off period
- grievance machinery
- vicarious liability of union officers
- Labor Code Articles 263 and 264
- NLRC grave abuse of discretion
I. Facts of the Case
The Union of Filipro Employees (UFE), together with numerous union officers and members, staged multiple strikes and walkouts against Nestlé Philippines, Inc. after the labor dispute was taken over by the Minister of Labor under the Labor Code and orders were issued automatically enjoining any strike and directing return-to-work. The peculiarity of the case is that, despite successive assumption/certification and return-to-work orders (including later directives), the union officers and members repeatedly continued strike and picketing acts and even committed other prohibited acts during work stoppages. The issue arose because Labor Arbiters and the NLRC declared the strikes illegal and held responsible identified union officers (including for loss of employment status) for participation in illegal concerted actions, prompting the union’s challenge up to the Supreme Court. The Court had to decide whether the legality determinations and related rulings (including constitutional arguments, mootness claims, alleged CBA limitations, and officer liability) were proper in light of the Labor Code’s mandatory cooling-off and injunction rules and the successive lawful orders of the labor authorities.
November 14, 1985
UFE filed a notice of strike (BLR-NS-11-344-85) with the Bureau of Labor Relations against Filipro (now Nestlé Philippines, Inc.).
December 11, 1985
Minister Blas F. Ople assumed jurisdiction under Article 264(g) of the Labor Code and issued an order strictly enjoining any strike, lockout, or other concerted action that would disrupt company operations.
December 20, 1985
UFE filed a petition for certiorari with prayer for a temporary restraining order (G.R. No. 73129) assailing the assumption of jurisdiction, but the union members continued and staged a strike and picket lines even without a restraining order.
January 23, 1986
Nestlé filed a petition to declare the strike illegal (NCR-1-295-86) based on violation of the CBA “no strike/no lockout” clause and the CBA grievance machinery provisions.
January 30, 1986
Labor Minister Ople ordered striking workers to report for work and directed the company to accept them within 48 hours, with hearings to decide issues within 30 days.
February 1, 1986
Nestlé published a notice advising workers to report by February 3, 1986, but UFE officers and members continued the strike.
February 4, 1986
The Minister denied UFE’s motion for reconsideration of the return-to-work order and enjoined disruptive acts including blocking ingress and egress to company premises; UFE defied the order and continued the strike.
March 13, 1986
Minister Augusto B. Sanchez issued a resolution enjoining all striking workers to return to work and directing Nestlé to grant special assistance to covered employees.
March 17, 1986
The strikers returned to work.
March 31, 1986
The Court granted UFE’s motion to withdraw its certiorari petition (G.R. No. 73129).
April 23, 1986
Minister Sanchez rendered a decision dismissing the union charge for unfair labor practices for lack of merit while ordering Nestlé to grant an additional bonus equivalent to one month’s gross compensation in addition to a one-month weighted average pay ordered in the return-to-work order.
June 6, 1986
Minister Sanchez modified the April 23, 1986 decision directing Nestlé to pay an anniversary bonus equivalent to one month basic salary in lieu of one month gross compensation.
November 13, 1987
After trial, Labor Arbiter Eduardo G. Magno declared the strike illegal; declared numerous named union officers to have lost employment status; declared the union guilty of unfair labor practice; and dismissed the union complaint for unfair labor practice.
January 22, 1986 to March 14, 1986
Between these dates (RAB-X-2-0047-86), rank-and-file employees staged a strike at UFE officers’ instigation.
November 24, 1987
Executive Labor Arbiter Zosimo Vasallo declared that strike illegal, declared the respondent union guilty of unfair labor practice, and declared named union officers to have lost employment status.
August 13, 1986 to September 22, 1987
In NCR-00-09-03285-87, UFE and its officers/members staged multiple work stoppages and participated in public actions/walkouts, including joining a picket line in sympathy with an illegal strike, a demonstration over the slaying of a labor leader, and walkouts leaving unfinished products that caused spoilage and economic losses, with further illegal activities after a return-to-work order; individual letters of termination dated September 14, 1987 were sent effective immediately.
January 12, 1988
Labor Arbiter Evangeline S. Lubaton dismissed the illegal dismissal/ULP/damages complaint for lack of merit and confirmed the dismissal of all individual complainants as legally justified, reasoning that dismissal depends on whether the strike was illegal.
November 2, 1988
The NLRC affirmed the labor arbiters’ rulings declaring the strikes illegal, emphasizing that the core issue was the legality of the strikes. It later issued a March 7, 1989 resolution rectifying paragraph 3 of its November 2, 1988 resolution by ordering reinstatement of Quezon G. Mateo, Jr. and Dionisio Completo without backwages.
March 7, 1989
NLRC resolution ordered reinstatement of Quezon G. Mateo, Jr. and Dionisio Completo without backwages.
December 19, 1990
The Supreme Court dismissed the petition and affirmed in full the NLRC decision dated November 2, 1988 and its Resolution dated March 7, 1989.
II. Issues
Whether or not Articles 263 and 264 of the Labor Code are unconstitutional and must be ignored for being based on the 1973 Constitution, considering the 1987 Constitution allegedly no longer contains Sec. 9 of Art. II on compulsory arbitration.
Whether or not the legality of the strike was rendered moot and academic when Nestlé accepted the striking workers in compliance with the return-to-work order of then Minister of Labor Augusto Sanchez dated March 13, 1986.
Whether or not UFE violated the no-strike/no lock-out clause under the CBA such that the strike was illegal, considering UFE’s contention that the prohibition applies only to economic strikes.
Whether or not the Labor Arbiter and NLRC erred in holding union officers liable for illegal acts through vicarious liability without specific findings identifying each officer’s participation.
III. Ruling
Whether or not Articles 263 and 264 of the Labor Code are unconstitutional and must be ignored for being based on the 1973 Constitution, considering the 1987 Constitution allegedly no longer contains Sec. 9 of Art. II on compulsory arbitration.
The Court rejected the constitutional challenge to Articles 263 and 264 of the Labor Code and treated the Labor Code’s mandatory assumption-of-jurisdiction and strike-enjoining rules as applicable to the labor dispute.
How the Court reasoned
- The Court emphasized the legal effect of the Minister/Labor Secretary’s assumption or certification, which automatically enjoins the intended or impending strike.
- It treated the Labor Code provisions relied upon by the NLRC as properly governing the parties’ conduct during the period of assumption/certification.
- The decision reflects that the constitutional argument did not persuade the Court to disregard the statutory injunction and prohibited-activities framework.
- Because the union continued strike-related acts despite lawful orders, the Labor Code framework remained decisive in determining illegality and the consequences that followed.
“We agree with the Solicitor General that the petition failed to show that the NLRC committed grave abuse of discretion in its affirmance of the decisions of the Labor Arbiters a quo.”
Rule applied
Article 263(g) and Article 264(a) of the Labor Code
Whether or not the legality of the strike was rendered moot and academic when Nestlé accepted the striking workers in compliance with the return-to-work order of then Minister of Labor Augusto Sanchez dated March 13, 1986.
The Court held that the case did not become moot because workers were later accepted under a return-to-work order; the illegality of the strikes and related liability issues remained for adjudication.
How the Court reasoned
- Under Article 263(g), assumption/certification has an automatic injunctive effect and requires striking workers to immediately return to work.
- The Court rejected arguments that later compliance with return-to-work directives erased the earlier illegality or the need to determine responsibility.
- The factual record showed repeated continuation of strike and picketing acts even after successive orders, which preserved the controversy over legality and consequences.
“Regardless therefore of their motives, or the validity of their claims, the striking workers must cease and/or desist from any and all acts that tend to, or undermine this authority of the Secretary of Labor, once an assumption and/or certification order is issued.”
Rule applied
Article 263(g) of the Labor Code
Whether or not UFE violated the no-strike/no lock-out clause under the CBA such that the strike was illegal, considering UFE’s contention that the prohibition applies only to economic strikes.
The Court affirmed the finding that the strikes were illegal for violating the CBA’s no-strike/no-lockout clause and for failure to follow required grievance machinery, strike-vote, cooling-off, and notice requirements, making the workers’ conduct actionable.
How the Court reasoned
- The Court accepted the NLRC’s view that the no-strike/no-lockout clause’s purpose is to prevent strikes and must be strictly respected.
- The NLRC found that UFE did not exhaust the grievance machinery steps under the CBA before going on strike.
- The decision notes non-compliance with mandatory cooling-off periods, failure to comply with required 7-day strike procedures and reporting of the strike vote, and lack of notice of strike for certain work stoppages.
- Accordingly, the strike conduct fell within the Labor Code’s prohibited activities and was properly declared illegal.
“ACCORDINGLY, the petition is DISMISSED, and the decision of public respondent NLRC, dated November 2, 1988, and its Resolution, dated March 7, 1989, are both AFFIRMED in their entirety.”
Rule applied
Articles 263 and 264 of the Labor Code, as applied to CBA “No Strike/No Lockout”
Whether or not the Labor Arbiter and NLRC erred in holding union officers liable for illegal acts through vicarious liability without specific findings identifying each officer’s participation.
The Court sustained the NLRC and Labor Arbiter rulings holding identified union officers responsible for participating in illegal strike acts; it rejected the claim that liability was imposed without specific identification of participation.
How the Court reasoned
- The NLRC affirmed that the core controversy turned on the legality of the strikes and that identified officers participated in illegal acts.
- The decision recounted that various named union officers were expressly declared to have lost employment status based on their involvement.
- The Court found no reversible error in the quasi-judicial tribunals’ treatment of union-officer responsibility in the context of repeated defiance of lawful return-to-work and anti-disruptive orders.
Rule applied
Labor Code Articles 263 and 264 (illegal strike/prohibited activities), as implemented through NLRC factual determinations
Doctrines
Once the Secretary of Labor assumes jurisdiction or issues a certification/assumption order under Article 263(g), the intended or impending strike is automatically enjoined and striking employees must cease and/or desist and immediately return to work; continued strike or picketing acts undermine the authority of the labor authority and may lead to illegal-strike consequences.
Noncompliance with mandatory statutory and contractual prerequisites for strikes—such as grievance machinery, cooling-off requirements, strike-vote and notice requirements, and the CBA no-strike/no-lockout clause—supports a finding that the strike is illegal and justifies disciplinary consequences for those found to have participated.
Final Disposition
ACCORDINGLY, the petition is DISMISSED, and the decision of public respondent NLRC, dated November 2, 1988, and its Resolution, dated March 7, 1989, are both AFFIRMED in their entirety. No costs. SO ORDERED
Notes
The record described multiple, successive labor dispute certifications/assumptions and return-to-work directives; the Court viewed the union’s repeated defiance as fatal to the petition and rejected attempts to defeat adjudication by later compliance.