G. R. No. L-10263. December 17, 1957

This is  an appeal by certiorari  of the  Association of Drugstore Employees from a decision of the Court of Industrial  Relations dated April 15,  1955,  in Case No. 949-V (8)  granting authority to Farmacia Oro to  close its  Rizal Avenue  and Taft Avenue branches with the consequent laying off of the personnel therein.  The facts of the ease are  as follows:

Case No. 549—V  (8)  is  an incidental case  to  the main controversy between  the management of Farmacia Oro and the  Association of Drugstore Employees composed of employees working in said establishment.   The incident arose out  of the  employer’s motion of August  2, 1952, seeking for  authorization from the Court  of  Industrial  Relations to close  3 of its stores, namely, the Taft Avenue, Legarda and  Rizal Avenue branches and the corresponding  laying off  of the personnel therein due to heavy  losses suffered by said  establishment occasioned by the big slump  in the volume of its business.   This motion  was opposed by the Union, alleging among others, that the laying-off  of personnel in said 3 stores was discriminatory because the management effected transfers of personnel from one  branch to another in anticipation of such move,  without  regard to seniority and other good practices of labor relationship. It was thus charged that the proposed closing of the aforementioned  stores was part of a  general scheme designed to prejudice the members of the Union.

On September 3, 1952, the Union filed an urgent  motion informing the Court that the management of Farmacia Oro caused the closing of its Rizal Avenue  and Taft Avenue branches’ and thus  prayed that  an examination  of the records of the establishment be ordered to find out whether losses were really incurred to justify the cessation of  business in said stores; to issue  an order requiring  the management to reinstate those  entitled  to  seniority rule to their former positions and for back wages from September 1, 1952, to the date of actual reinstatement; and to  punish the owners of Farmacia Oro for contempt of court.  In its reply,  the respondent contended  that  the Rizal Avenue and Taft Avenue stores  of the Farmacia Oro were closed for reasons already stated in its motion; that the employees affected by such step were duly notified of the closing of these branches; that the dismissal of personnel therein was not discriminatory because all employees working  in  said stores  were laid off except those in the Central accounting department who were transferred to the Oro Laboratories; that the seniority  rule could not be followed because it would  prejudice those employees who were able  to survive the slump  in  the business  of respondent.

After  the parties had presented their evidence to   sup- port their  respective stands, the Court  rendered decision dated April 15, 1955, with 2 Judges dissenting, allowing the management to close its  drugstores in Rizal Avenue and Taft Avenue and lay off the  personnel therein,  after finding that respondent transferred some of the employees to the Rizal Avenue store not by reason to their ‘union affiliation or  activities  but in the honest exercise of its prerogative as an  employer,  with which,  the Court had no power to interfere.  As  the motion filed by the Union for the reconsideration of the decision was denied by re- solution  of the Court in bane on October  25, 1955, the matter was brought to this Court on appeal raising1 as the sole issue the question of “whether a contract, fixing the terms and conditions  of work, freely entered into by both parties and  which was made the basis of a final  award by the court can be disregarded  and violated”.

It appears that in the course of the hearing,  the Union withdrew its demand for an examination of the books of account of the  management  and in effect admitted the employer’s right to close its stores.   But opposition was  consistently offered against the laying off  of  the  employees working in the stores subject of controversy as some of them were  employed  ahead  of those  who  were retained in the employ  of  the establishment.   Petitioning  Union maintains that pursuant  to the partial decision  of  the Industrial Court in the main case  (No. 549-V), fixing some of the terms and conditions  of work in said stores, one of which is:

“DEMAND NO. VII-SENIORITY
“Seniority shall  be determined  by the length of continuous service an employee has been on the payroll of the company. Any employee who is laid off by the Company  and subsequently re-employed  shall be credited with his  previous seniority;  Provided that length of service shall be determined from the date of the original employment by the Company.”

“There being no objection from respondent, the foregoing demand is hereby granted”

seniority rule should have been observed in the dismissal of the employees involved herein.

It could be seen, however, that the aforequoted demand of the Union which was approved by the Court and embodied in its decision in  the main case is merely a statement or declaration of how seniority rule  should  be determined for the purpose of crediting” the same in favor of the  employees of  the  company, which the  Union  cannot  invoke in the case  at  bar.  Although  an  employer’s  disregard of  an employee’s  seniority rights is evidence that the discharge of the employee possessed of such rights is intended to discriminate, and this is especially true where the main achievement of the Union against whom  the employer intends to discriminate, is seniority rights (Vol. II, Ludwig Teller’s  Labor Disputes and Collective Bargaining, p. 838-839), considering that petitioner in the instant case acknowledges  the employer’s right to close its stores and lay on  the personnel therein, and as the lower Court found that  the employees  who manned these stores were originally  assigned therein or  transferred  thereto, apparently without any objection on the part of the transferees, pursuant to  the employer’s privilege to transfer any of its employees to  the different branches of said establishment, We fail to  see any act of discrimination in their dismissal upon the cessation  of business in said stores belonging to respondent.  The fact that the parties  already reached an  agreement on how seniority among employees should be determined, which was  approved by the court, and that the employees involved herein are ahead in employment than those who were not laid off, have  no  bearing in the controversy for it  is not assailed that  the laying off  of personnel was the result of the  closing of the aforementioned stores.  Actually the only question in this  case is whether  the  transfer  of the  employees  to  the stores which were subsequently  closed was part of a  scheme or maneuver on the part of the employer to ease out of its employ the  employees involved herein which would then be a case  of discrimination.  But this matter was  already taken out of our reach when the lower Court,  after  considering the evidence on hand, resolved the question in the negative and it being essentially a question of fact, We are restricted by law to review the same (Isaac Peral Bowling Alley vs.  United Employees’ Welfare Association et al., supra, p.  219; G.  P.  T.  C. Employees’ Union vs. Court of Industrial Relations et al., supra, p.  538).

Wherefore, the petition for  certiorari  is dismissed and the decision of the  lower Court dated April 15,  1955, in this case is hereby  affirmed, without pronouncement  as to costs.  It is  so ordered.

Bengzon, Padilla,  Montemayor,  Reyes, A., Bautista Angelo, Labrador, and  Endencia, JJ., concur.

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DISSENTING
Reyes, J.B.L., with whom Paras, C.J., concurs, :

I can not subscribe to the view that the violation of the seniority rule, agreed between the parties, is not involved. Since the employee were rotated among the different branch stores from time to  time, it is but logical to view them as employees of the corporation regardless of the stores where they happen to be working at a given time.  Granting that financial conditions demanded that some of the branch stores should be closed, the lay-off or reduction of personnel should have been  made by the  respondent company  strictly ac- cording to the stipulated  seniority  rule, i.e., by keeping in its employ those who were oldest in the service, regardless of their place  of work at the closure time.  If the branch stores were not treated as separate units for the assignment of the employees, why should they be regarded as independent establishments for lay-off purposes?   It is  easy to see that unless the seniority rule is observed,  the company can commit  discrimination in the lay-off by assigning the employees  it dislikes to the branch stores that are slated to be closed.   The fact that nine senior employees were among those laid-off supports the view of the minority judges of the Industrial  Court that  discrimination was intended, and it should not be sanctioned by  this Court.