NATIONAL LABOR UNION AND/OR MARCELO DOMINGO, PETITIONER-APPELLEE, VS. THE NATIONAL LABOR RELATIONS COMMISSION AND PEPSI COLA BOTTLING COMPANY OF THE PHILIPPINES, RESPONDENTS-APP…

Petitioner seeks to annul the decision of the National Labor
Relations Commission (NLRC for short) dated November 23, 1978, reversing the
decision of Labor Arbiter Angel G. Ronquillo and dismissing the petitioner’s
complaint for illegal dismissal against Pepsi-Cola Bottling Company of the
Philippines, Inc. (Pepsi-Cola for short).

This case arose from the allegedly illegal dismissal of
petitioner Marcelo Domingo on January 21, 1971, by Pepsi-Cola.  He was a regular employee of Pepsi-Cola since
July 15, 1963 as driver-salesman.  In his
complaint filed on March 31, 1976, docketed as NLRC Case No. RB-III-555-76,
Domingo alleged that the grounds for his dismissal, namely, violations of
company rules and regulations regarding customer relations, honesty and proper
accounting of funds, were fabricated and without factual basis.  He claimed that the charges were trumped-up
in order to ease him out of the company on account of his role, as president of
the union (National Labor Union, NATU), in staging a strike against the
company.  In its answer, the respondent
Pepsi-Cola alleged that the termination of Domingo’s employment was for just
cause, and it moved for the dismissal of the complaint on the ground that the
petitioner’s cause of action was barred by a prior judgment.  It appears that on June 4, 1974, Pepsi-Cola
was granted clearance by the Ministry of Labor and Employment, as required then
under the Labor Code, to terminate the services of Domingo in a decision rendered
by Labor Arbiter Luciano Aquino in NLRC Cases Nos. 283 and 283-A.

Petitioner’s complaint for illegal dismissal was heard on the
merits, and on May 2, 1978, Labor Arbiter Angel RonquilIo rendered a decision
declaring the dismissal illegal and ordering Pepsi-Cola to reinstate him
without loss of seniority rights and to pay backwages from January 21, 1974
until reinstated.

From the above decision, Pepsi-Cola appealed to the National
Labor Relations Commission, invoking the doctrine of res judicata in that the
legality of the dismissal of Domingo was a matter already adjudicated by Labor
Arbiter Luciano P. Aquino in NLRC Cases Nos. 283 and 283-A on June 4, 1974,
wherein Pepsi-Cola was given clearance to terminate Domingo’s services.

On November 23, 1978, the NLRC promulgated its decision reversing
the appealed decision of Arbiter Ronquillo on the ground that the decision of
Arbiter Luciano Aquino, dated June 4, 1974, constituted a bar to the cause of
action in the instant case.

Petitioner’s motion for reconsideration was denied by the NLRC in
its resolution of June 28, 1982.  Hence,
the present petition for certiorari.

On September 15, 1982, this Court gave due course to the petition
and required respondents to answer. 
Subsequently, both parties were required to file their respective
memoranda.

The pivotal issue in the instant case is whether the NLRC
committed grave abuse of discretion in holding that Domingo’s complaint for
illegal dismissal was barred by the decision of Labor Arbiter Luciano Aquino,
dated June 4, 1974, granting clearance to Pepsi-Cola to terminate the services
of Domingo.

We find merit in the petition. 
It was a grave abuse of discretion for the NLRC to dismiss petitioner’s
complaint on the ground of res judicata.  The NLRC wrongly assumed that
petitioner was a party to the proceedings
before Labor Arbiter Luciano Aquino and since the cause of action raised in
said case was “squarely identical” with that of the petitioner’s
present complaint, the decision in the former case constitutes res judicata or
the law of the case between the parties.

An examination of the record, however, shows that petitioner was
not a party to the former case.  The
application for clearance to terminate, docketed as NLRC Case No. 283, was
entitled “Pepsi-Cola Bottling Co., Petitioner, versus Union of Pepsi-Cola
Bottling Company Employees Union, NATU, Respondent”.  The application was contested by the union in
a counter-petition, which was docketed as NLRC Case No. 283-A, entitled
“Pepsi-Cola Bottling Company Employees Union, NATU, Petitioner, versus
Pepsi-Cola Bottling Company, Respondent”. 
Both petition and counter-petition were heard jointly by Labor Arbiter
Luciano Aquino.  It is clear that in both
cases, the petitioner was not involved as a party.  The NLRC, in its questioned decision, made
the mistaken assumption that petitioner was a party to the proceedings before
Labor Arbiter Luciano Aquino and that what he should have done was to appeal
from the latter’s decision, and not to file a new case as he did in the case at
bar.  But how could petitioner have appealed the decision
of Arbiter Aquino when he was not included as a party thereto?  In fact, the union under its new president
had naturally no desire or inclination to appeal the decision, since with the
suspension and subsequent removal of the petitioner, who was the incumbent
union president when the case was filed by
Pepsi-Cola, would redound to the benefit of the new union president who
succeeded him.  The counter-petition
supposedly contesting the application for clearance to terminate was filed by
the union and verified by its new president, not by the petitioner.  In the proceedings before Arbiter Aquino, the union was represented by its counsel
and its position paper and memorandum were filed by said counsel, acting for
and in behalf of the union and not as counsel for petitioner Marcelo Domingo,
as erroneously assumed by the NLRC in its questioned decision.

The law applicable at the time of petitioner’s dismissal in 1974 required that
notice of the application for clearance to dismiss an employee must be
served on the employee concerned.^[1]
This requirement is part of due process which apparently was denied the
petitioner.  The record does not disclose
that notice of the application was given to petitioner.

It should be noted that
the application for clearance to dismiss an employee under existing law at that
time was by its nature a speedy and summary process, in contrast to proceedings in a complaint for illegal dismissal which afford the
employee concerned greater opportunity to ventilate his claim, present
evidence and cross-examine witnesses.  In
this sense, the decision of Labor Arbiter Angel Ronquillo, who heard the
petitioner’s complaint for illegal dismissal against Pepsi-Cola gave the
parties more ample opportunity to present their respective sides.  On the other hand, the proceedings in an
application for clearance to dismiss an employee obtaining at the time of the
petitioner’s dismissal were more of a conciliation, rather than adversarial
process, and any clearance thus granted was without prejudice to the right of
the employee concerned to seek redress of his grievances, if any, under
existing laws and decrees.^[2]
Under these circumstances, there can be no res judicata.

WHEREFORE, the petition for certiorari is GRANTED
and the decision of the National Labor Relations Commission, dated November 23,
1978, is SET ASIDE.  The decision of
Labor Arbiter Angel Ronquillo, dated May 2, 1978, is hereby reinstated, with
the modification that payment of backwages shall be limited to three (3) years.

SO ORDERED.

Paras, Padilla, and Sarmiento,
JJ., concur.

Melencio-Herrera, J., on leave.

^[1]
Rule XIV, Book V, Rules and Regulations.

^[2]
Ibid.