San Miguel Corporation v. NLRC

G.R. No. 108001 (March 15, 1996)

San Miguel's challenge to Labor Arbiter's authority was dismissed; jurisdiction upheld under Labor Code.

Facts:

The case involves a dispute between San Miguel Corporation (SMC) and its employees, who are members of the union Ilaw at Buklod ng Manggagawa. The employees, working as mechanics, machinists, and carpenters, were notified on July 31, 1990, that they would be separated from service due to redundancy, effective October 31, 1990. The union opposed this decision and requested a dialogue with management. Despite ongoing discussions, SMC issued a memorandum on October 1, 1990, confirming the dismissal of the employees effective November 2, 1990.

On February 25, 1991, the employees filed a complaint against SMC for illegal dismissal and unfair labor practices (ULP) with the National Labor Relations Commission (NLRC). The case was assigned to Labor Arbiter Eduardo F. Carpio. SMC filed a motion to dismiss the complaint, arguing that the Labor Arbiter lacked jurisdiction because the collective bargaining agreement (CBA) required disputes to be resolved through grievance and arbitration procedures first. The Labor Arbiter denied this motion, leading SMC to appeal to the NLRC, which upheld the Labor Arbiter's decision.

Legal Issues:

  1. Whether the Labor Arbiter had jurisdiction to hear the complaint for illegal dismissal and unfair labor practices despite the grievance and arbitration provisions in the CBA.
  2. Whether the union's failure to seek reconsideration of the dismissal affected the jurisdiction of the Labor Arbiter.
  3. Whether the allegations of unfair labor practices were sufficient to establish jurisdiction.

Arguments:

Petitioners' Arguments (SMC):

  • SMC contended that the Labor Arbiter lacked jurisdiction over the case because the CBA mandated that disputes be resolved through grievance and arbitration procedures before any formal complaint could be filed.
  • They argued that the CBA's provisions on job security and grievance machinery indicated that the union recognized the dismissal as a grievable issue.
  • SMC claimed that the union's allegations of unfair labor practices were conclusory and did not establish a genuine case.

Respondents' Arguments (Union and Employees):

  • The union argued that the Labor Arbiter had original and exclusive jurisdiction over cases of illegal dismissal and unfair labor practices under Article 217(a) of the Labor Code.
  • They maintained that the union did not seek reconsideration of the dismissal, which meant that the grievance procedure outlined in the CBA was not applicable.
  • The union asserted that the allegations of unfair labor practices were sufficiently detailed to warrant a hearing before the Labor Arbiter.

Court's Decision and Legal Reasoning:

The Supreme Court dismissed the petition filed by SMC, affirming the NLRC's resolutions. The Court held that the Labor Arbiter had jurisdiction over the complaint based on the following reasoning:

  1. Jurisdiction of Labor Arbiter: The Court emphasized that Article 217(a) of the Labor Code grants Labor Arbiters original and exclusive jurisdiction over unfair labor practices and termination disputes. The CBA's provisions did not negate this jurisdiction, as there was no express agreement to submit such disputes to voluntary arbitration.

  2. Failure to Seek Reconsideration: The Court found that the union did not exercise its right to seek reconsideration of the dismissals, which was a prerequisite for invoking the grievance procedure under the CBA. Therefore, the union acted within its rights by filing the complaint directly with the Labor Arbiter.

  3. Sufficiency of ULP Allegations: The Court determined that the allegations made by the union constituted a bona fide case of unfair labor practices. The complaint detailed how the dismissals affected the employees' rights to self-organization and collective bargaining, thus justifying the Labor Arbiter's jurisdiction.

  4. State Policy on Labor Disputes: While the Court acknowledged the strong state policy promoting voluntary settlement of labor disputes, it clarified that jurisdiction cannot be appropriated without an express legal basis. The absence of an agreement to submit the case to arbitration meant that the Labor Arbiter's jurisdiction remained intact.

Significant Legal Principles Established:

  • The Labor Arbiter has original and exclusive jurisdiction over illegal dismissal and unfair labor practice cases, regardless of grievance and arbitration provisions in a CBA, unless there is a clear agreement to the contrary.
  • The failure of a union to seek reconsideration of a dismissal precludes the application of grievance procedures outlined in a CBA.
  • Allegations of unfair labor practices must be sufficiently detailed to establish a genuine case warranting a hearing.