Labor v. Anakan Lumber Company
Confederated Sons of Labor v. Anakan Lumber Company, United Workers' Union and Court of Industrial Relations, G.R. No. L-12503, April 29, 1960
- Labor Law
- closed shop
- collective bargaining agreement
- unfair labor practice
- union security
- dismissal
- expulsion from union
- strict construction
- reinstatement
- Republic Act No. 875
- Court of Industrial Relations
I. Facts of the Case
Confederated Sons of Labor filed an unfair labor practice complaint against Anakan Lumber Company and the United Workers' Union before the Court of Industrial Relations. The complaint arose from the company's dismissal of 46 employees who had been expelled from the union after joining the petitioner. The company and union justified the dismissal under a 'Collective Bargaining and Closed Shop Agreement'.
January 23, 1955
United Workers' Union, with over 1,000 members who were company laborers and employees, entered into a 'Collective Bargaining and Closed Shop Agreement' with Anakan Lumber Company.
Forty-six employees who were members of the respondent union joined the Confederated Sons of Labor, another labor organization. They were consequently expelled from the respondent union under its constitution and by-laws.
Invoking Article II of the agreement, the respondent union demanded that the company dismiss the 46 employees. The company dismissed them in compliance with the demand.
August 24, 1955
After all but one of the employees had been dismissed (the last on August 30, 1955), Article II was amended to add that the company would 'retain in its employ only such employees or laborers who remain members of good standing of the Union.'
Confederated Sons of Labor filed an amended complaint with the CIR charging the company with unfair labor practices (domination of the union and discrimination in hire or tenure by dismissing workers affiliated with petitioner). It also charged the union with causing the discrimination under Sec. 4(a)(4) and 4(b)(2) of R.A. No. 875.
During trial, on petitioner's motion and with respondents' conformity, the CIR dismissed the charge of union domination against the company.
October 4, 1956
The CIR presiding judge absolved the union but found the company guilty of unfair labor practice for dismissing the 46 employees. He ordered it to cease and desist and to reinstate them with back wages.
December 28, 1956
On respondents' motion for reconsideration, a majority of the CIR en banc reversed the order and dismissed the complaint.
Petitioner filed a petition for review by certiorari with the Supreme Court, contending that Article II did not oblige the company to dismiss employees who ceased to be union members.
II. Issues
Whether or not Article II of the collective bargaining agreement established a 'closed shop' requiring employees to remain union members in good standing to keep their jobs.
Whether or not the company was bound under Article II of the agreement to dismiss the 46 employees who were expelled from the union after joining another labor organization, such that their dismissal was not an unfair labor practice.
III. Ruling
Whether or not Article II of the collective bargaining agreement established a 'closed shop' requiring employees to remain union members in good standing to keep their jobs.
Article II did not create a closed shop except in a very limited sense, namely that employees engaged after January 23, 1955 must be union members. It did not require employees to remain union members to keep their jobs.
How the Court reasoned
- A closed shop stipulation obliges the employer to dismiss employees who are not or cease to be union members. Such an undertaking is harsh on workers' rights.
- Because of that harshness, it must be clear and unequivocal, strictly construed, and doubts are resolved against the existence of a closed shop.
- Article II does not say that employees must continue to remain members in good standing to keep their jobs.
- Article II therefore only requires that employees engaged after the agreement's signing on January 23, 1955 be union members, which is a limited closed shop.
- Article III-A did not list loss of union membership as a ground for dismissal, which confirms that Article II was not meant to cover it.
“Inasmuch as Article II above quoted does not provide that employees "must continue to remain members in good standing" of respondent union "to keep their jobs," the collective bargain-agreement between them does not establish a 'closed shop," except in a very limited sense, namely, that the laborers, employees and workers engaged by the company after the signing of the agreement on January 23, 1955, must be members of respondent union.”
Rule applied
Strict construction of closed shop stipulations under Sec. 4(a), par. 4 and Sec. 4(b), par. 2 of Republic Act No. 875
Whether or not the company was bound under Article II of the agreement to dismiss the 46 employees who were expelled from the union after joining another labor organization, such that their dismissal was not an unfair labor practice.
The company was not bound by the agreement to dismiss the 46 employees. Dismissing 45 of them before the amendment was illegal, and they must be reinstated.
How the Court reasoned
- Respondents argued that Article II obliged the company to dismiss employees who ceased to be union members, but the Court rejected this pretense.
- Since Article II did not clearly impose a duty to dismiss on loss of membership, the company had no contractual justification for the dismissals.
- The August 24, 1955 amendment adding the retention clause shows that, before it, the company was not bound to dismiss employees who lost union membership.
- The amendment cannot justify dismissals made before it took effect, so the dismissal of 45 of the 46 employees was illegal.
- Because the company relied on the agreement, the Court gave it the benefit of the doubt on good faith, so no back wages were awarded.
“In short, the dismissal of 45 out of the 46 laborers in question, prior to said amendment of Article II, was illegal, and, hence, said 45 laborers should be reinstated.”
Rule applied
Strict construction of union security clauses; Sec. 4(a), par. 4 of Republic Act No. 875; National Labor Union v. Aguinaldo's Echague, Inc.; Bacolod-Murcia Milling Co. v. National Employees-Workers Security Union
Doctrines
A stipulation obliging an employer to dismiss employees for loss of union membership (a closed shop) must be clear and unequivocal. It is strictly construed, and doubts are resolved against the existence of a closed shop.
A clause requiring only that employees engaged after the agreement be union members does not oblige the employer to dismiss employees who later cease to be members. A later amendment adding a retention clause shows the employer was not previously bound to dismiss.
Final Disposition
WHEREFORE, the resolution of the Court of Industrial Relations en banc is affirmed only insofar as the 45 laborers are concerned, as to whom reinstatement is ordered, with costs against respondents.
Notes
The Court affirmed the CIR en banc resolution only as to the 45 laborers dismissed before the August 24, 1955 amendment, and ordered their reinstatement. The one employee dismissed on August 30, 1955, after the amendment, was apparently treated differently. No back wages were awarded because the company was given the benefit of the doubt as to good faith.