PHILIPPINE FEDERATION OF PETROLEUM WORKERS (PFPW) AND MALAYANG MANGGAGAWA SA ESSO, PETITIONERS, VS. COURT OF INDUSTRIAL RELATIONS AND ESSO STAN­DARD EASTERN, INC., RESPONDENTS.

Two separate appeals from a decision of the Court of Industrial
Relations on an indus­trial dispute and strike declared on February 19, 1965, by members of the Malayang Manggagawa sa Esso (MME) and certified on November 5, 1965 to said court by the
President of the Phil­ippines.

On November 13, 1965, the striking union, MME, affiliate of the
Philippine Federation of Petroleum Workers and the employer-company, Esso Standard Eastern, Inc. (ESSO), concluded without the
trial court’s intervention, a return to work agreement pending the resolution
of their labor dispute by the industrial court, and jointly sought the court’s
approval thereof, which was granted in a partial decision dated Novem­ber 27,
1965, enjoining the parties to comply with the terms thereof.

This gave a peculiar aspect to the case at bar, as noted by the
trial court itself in its decision in that “the parties to the labor
dispute have agreed on a set of proposals to be litigated as issues in this
case, and the same parties have by express stipulation reserved determination
of other issues in cases now pending determination in other branches of this
Court.”

Thus, of eleven demands filed by the striking union after the
filing of the joint motion for approval of the return to work agreement dated
November 12, 1965 – although the trial court had earlier issued in open court
an order on November 5, 1965, for the union to formalize in a petition all its
demands in con­nection with the case – the trial court in its decision at bar
dismissed outright four demands since they “are not any of those specifically
provided as litigable issues in these proceedings and are issues in the other
cases pending before the different salas of the court
of industrial relations.  The parties
them­selves by the terms of their Return to Work Agreement of Nov­ember 12, 1965 have reserved
these cases for judicial deter­mination in the different salas
where they are now pending consideration.”

These four dismissed demands^[1]
involved three demands of the striking union for reinstatement with back wages
of its members, strike duration pay and discharge of all scabs, strike breakers
or replacements and the giving back of such positions to the returnees to work,
and stoppage of further acts of discrimination and coercion against the
striking union’s members – and were held by the trial court to depend on the
determination of the legality of the strike as well as the alleged
confabulation between the company and a rival union, the Citi­zens Labor Union
(CLU), which were issues reserved by the parties’ agreement for resolution by
other branches of the in­dustrial court in two other pending cases of unfair
labor prac­tice.  (Cases Nos. 4289-ULP
and 4301-ULP).  The fourth dismissed
demand was for the company to turn over to MME the union dues checked off under
the company’s collective bar­gaining agreement with its rival CLU from
employees who are its (MME) members, which the trial court held should be re­solved
in the pending certification election case, (Case No. 1459-MC).

This left six demands^[2]
to be passed upon by the trial court in the case below.  The irregularity and undesira­bility of such
a splitting of the issues and piece-meal procedure could not but be noted by
the trial court itself in its decision in this wise:  “Before proceeding, however, with the
determi­nation of the demands so mentioned, it must be emphasized that this is
a proceeding arising out of a certification by the President of the
Philippines, pursuant to Section 10 of Republic Act No. 875.  It indicates the degree of urgency required
in the settlement of the terms and conditions of employment involved in the
labor dispute.  If in the course of
arriving at a fair and just determination certain aspects obtaining in the
other cases between the parties have to be resolved, or that certain
evidentiary matters might come up for evaluation, which aspects and/or matters
may likewise be subject to a similar or different evaluation in the other cases
between the same parties, then this Court may not shirk from its duty to
determine the same, in compliance with the directives of the presidential
certification and the mandates of the law decree­ing such certification.”

While none of the parties specifically assigned as error this
irregular procedure, (since they were mainly responsible therefor
in having split the issues and expressly reserved other issues for
determination in theoother cases pending in other
branches of the industrial court), the Court takes note thereof and declares
that such a procedure was erroneous.  As
noted by the trial court itself, this proceeding arises out of a cer­tification
by the President of the Philippines
under section 10 of Republic Act No. 875^[3]
and per se indicates the degree of urgency required in the
settlement of the terms and condi­tions of employment involved in the labor
dispute.  The indus­trial court, in such
cases, is empowered to act therein with the broad powers and jurisdiction
granted it by law,^[4]
in­cluding the power of conciliation and compulsory arbitration; it is
empowered to order the return to work of the workers with or without backpay, and “shall not be restricted to the specific
relief or demands made by the parties to the indus­trial dispute, but may
include in the award, order or decision any matter or determination which may
be deemed necessary or expedient for the purpose of settling the dispute or of
pre­venting further industrial disputes.”^[5]

Where the industrial
dispute has been certified by the President to the industrial court, therefore,
all issues involved in the industrial dispute should be aired and determined in
the case, where the dispute as certified by the President is docketed.  The parties should not be permitted to
isolate other germane issues or demands and reserve them for determina­tion
in the other cases pending before other branches of the industrial court, as
was done here.  All such other pending
cases should be consolidated in, or at least jointly tried^[6]
by, the branch which has taken cognizance of the case over the certified
industrial dispute towards the end that all the issues and demands may be
finally determined and the dispute definitely settled, rather than merely
arrive at a piece-meal settlement as in the case at bar, with the added
disadvantage as noted by the trial court that in passing upon certain issues
before it, it would have to rule upon certain aspects likewise involved in the
other cases and on which the other branches might reach a contrary evaluation
and conclusion.

Concretely applied to the case at bar, the trial court,
therefore, should not have approved the return to work agree­ment submitted
independently and with exclusion of relevant issues by the parties, but as the
branch where the dispute as certified by the President was docketed, required
the conso­lidation, or arranged with the other branches for the joint trial, of
all the other cases pending in the other branches, with the certification and
compulsory arbitration case before it, after which it could have issued a
return to work order, and thus avoided the anomalous situation confronting us
where the full resolution of this certified dispute is deferred and made to
await and depend on the separate decisions of the other bran­ches of the
industrial court in other cases. 
Certainly, the issues involved in said cases and covered by the four
demands of the striking union dismissed outright by the trial court (since the
parties were erroneously permitted to reserve them for separate determination
by the other branches of the industrial court, as above stated) – dealing as
they do with alleged acts of discrimination and coercion against the members of
the striking union (MME) and of alleged confabulation between the company and
the rival union (CLU) as well as with the legality of the strike – were hardly segregable from the very core of the dispute which the
trial court was empowered and called upon to settle as a whole.

We believe that this would have been the most expeditious
procedure to resolve all issues in the urgent indus­trial dispute certified to
the industrial court as involving the national interest, unlike that followed
in the case at bar, where the lower court was compelled to hand down its piece?meal
decision, instead of conclusively settling the dispute as authorized by law,
since resolution of the other related cases had to await the decision yet to be
handed down by the other branches where they were pending.  As a practical matter, this would have saved
the time of the industrial court and parties and would avoid needless
duplication of effort and hearings.  More
importantly, as a matter of public interest since all the issues involved in
the cases which gave rise to the industrial dispute and strike were all related
and did not involve mere economic demands but unfair labor practice charges
which are specially impressed with public interest – public policy would have
been subserved by the consolidation or joint trial of
all the cases to enable the industrial court to discharge its task of finally
settling the dispute once and for all and preventing further industrial
disputes, rather than leaving a number of related issues unresolved to await
the decisions of other branches of said court.

In the light of this fait accompli which impeded
the total settlement of the urgent dispute to the prejudice of the workers, the
Court will proceed to the review of the trial court’s deci­sion on the limited
issues and demands taken cognizance of and subject of the present appeals.  These six demands of the striking union were
the following:

“No. 1. – That the position of Assistant truck drivers or
truck helpers and fillers should not be abolished;

“No. 2. – In the event that the Can Plant is closed, all
employees therein will be trans­ferred to other plant duties and their position
titled will not be changed nor will their wages presently earned be reduced;

“No. 3. – No change in terms and condi­tions of employment of employees assigned now
to the Manila International Airport or JOCASP which includes, among others,
meal allowances and overtime shall be made;

“No. 5. – That Rodolfo Espiritu and
Rey­naldo Recio, Vice-President and Secretary,
respectively, of petitioner union be reinstated immediately;

“No. 7. – The retirement age of employees shall be 60, as has
been the previous practice of the Company, and all those who have been retired
by the Company at earlier than the age of 60 shall be reinstated; and

“No. 9. – The memorandum of agreement dated January 6, 1965 be declared invalid
and that any loss of benefits by reason of the enforce­ment of such agreement
be restored to the em­ployees concerned.”

In ruling upon these demands, the trial court first gave the
following background facts:

“The predecessor of the respondent company was Standard Vacuum Co.
In 1960, the latter was split into the present company and Mobil Philippines.  The respondent absorbed all the working force
in Luzon (t.s.n. 35, 36, Feb. 18, 1966; 23-24, Feb. 17, 1966).  The Pandacan
terminal to which most of the employees involved in this case were assigned is
the main distribution center for bulk and package products both during the time
of Standard Vacuum Company and subsequently when the splitting of this company
took place afterwards.  Because of this
development plus improved and more efficient operating conditions, respondent
company real­ized that it has extra or excess personnel, which later on were
termed redundant employees.

“On April 8, 1963,
respondent company and the Citizens Labor Union (the majority bar­gaining
representative) executed a Collective Bar­gaining Agreement (Exhibits ‘M’ &
‘1’) for a period of three years (up to July
8, 1966).  At the time of the
signing of this Agreement, almost all if
not all of the present members of the petitioner MME were then members
of the contracting union including its incumbent president.

“Among the pertinent provisions of this Agreement are the following
and we quote:

“’Section 1, Article II — Nothing in this Agreement contained
shall be deemed to limit the Company in any way in the exercise of the regular
and customary functions of Manage­ment.

”’Section 2 (supra) — The Union acknowledges that the Company, in
the exercise of these functions of management, has the sole and exclusive right
among others, but not limited to, determine the number and locations of the
work sites; select and direct the work­ing force; assign work including the
transfer of tasks among and between the jobs; change the means, methods,
processes and schedule of operations; determine the complement and schedule of
the various units, promote, trans­fer, lay off employees; maintain order, sus­pend,
demote, discipline and discharge employ­ees for causes; and maintain the
efficiency of employees.

“’It is expressly understood that the exer­cise by the Company
of any of the foregoing functions shall not alter any of the specific pro­visions
of this Agreement, nor shall they be used to discriminate against any employee
because of membership in the Union.  It is further under­stood that, in
determining reassignments, em­ployees will be assigned normally to related and
comparable work whenever this is feasible and consistent with efficient
operations.  Such reassignments will be
prompted normally by emergencies, operational needs of the business and/or lack
of work.

x        x          x          x          x

“’Section 2, Article IX — An employee who has completed three
(3) consecutive years of service, but less than ten (10) years of ser­vice, and
who is terminated by the Company, will be granted a termination allowance of
three (3) weeks’ base pay for each year of credited service.

“’An employee who has completed ten (10) or more consecutive
years of service and who is terminated by the Company will be granted
termination allowance of one (1) month’s base pay for each year of credited
service.

x        x          x          x          x          x

“There appears to be no dispute as far as the validity of this
Collective Bargaining Agreement is concerned. 
What appears to be in controversy is the interpretation of the different
provisions of the same.

“In the Memorandum dated September 30, 1963 (Exh. ’15’), approximately five months after the above-mentioned
Collective Bargaining Agree­ment, respondent company offered a special sepa­ration
payment due to extensive redundancy exist­ing at its Pandacan
Terminal.  The memorandum in question
indicated that the same is by applica­tion on a voluntary basis, and the
deadline for the filing of applications was set on October 4, 1963.

“On November 8, 1963, another agreement appears to have been
executed between the Citi­zens Labor Union and respondent company (Exh. ’17’).  This
agreement while emphasizing that the same is not a renegotiation of the
Agreement of April 8, 1963, superseded and added certain terms and conditions
to the said April 8, 1963, Agreement.

“The relevant portions of the Agreement are quoted as follows:

“x       x          x          x
         x          x          x          x          x

“’Regular employees may continue to work up to the age of
sixty (60) so they may enjoy Social Security Benefits provided the employee
upon examination is found to be medically and physically fit.

“’x           x          x          x          x

“’ 9.    This agreement shall not in any way be
considered as a renegotiation or change in any term or condition in the Working
Agree­ment of April 8, 1963 or a
waiver of the rights, responsibilities and obligations of each party to the
other as contained therein, and that said Working Agreement of April 8, 1963
will continue in full force and effect until its expira­tion date, without
modification of any kind whatsoever.

“On January 6, 1965
another Memorandum of Agreement was executed between the Citizens Labor Union
and respondent company (Exh. ‘B’).  It is to be noted that this Agreement was
acknowledged before a Notary Public on January
15, 1965.  Em­phasis was
again laid in this Agreement that the same is not to be considered as a remegotiation or a change of the Collective Bargaining
Agreement on April 8, 1963.  The terms and conditions of this Agreement (Exh. ‘B’) are substantially similar to terms and conditions
of the Return to Work Agree­ment of November 12, 1965, and the retirement age
of eligible employees was placed at 55 years.

“It is well to pause and note certain signifi­cant aspects of the
circumstances thus far narrated as follows:

(a)    The present members of the MME, with the
exception of one as admitted by petitioner, were all members of the Citizens
Labor Union at the time the Agreement of April 8, 1963 was executed as well as
the Agreement November 8, 1963;

(b)    That respondent company, as early as April
8, 1963, has the acknowledged right to terminate employees covered by the
agreement either due to excess of work force or improved means of operation;

(c)    That the different Agreements, e. g. of
April 8, 1963, November 8, 1963, January 6, 1965 cannot be dissociated and be
treated as inde­pendent of each other in view of the express provisions in the
latter agreement that what­ever has been agreed upon cannot be consi­dered as a
renegotiation of April 8, 1963 Agreement;

(d)    That in the several agreements mentioned (Exh. ‘M’, Exh. ‘17′, Exh. ‘B’) the retirement age has been variously mentioned
at either 55 or 60 years of age;

(e)    That it was only on the Agreement of January 6, 1965 that the respondent
company seemed to have actively and compulsorily exercised its rights to
terminate its employees under cer­tain conditions due to redundancy;

(f)     The principle of seniority seems to be the
main and only factor, hence the LIFO lists, meaning last in first out, where
the less senior employees are first to be terminated.  While the Agreement of April 8, 1963 speaks of ability to perform the
work and physical fitness (Article X, Exh. ‘M’)
before length of service is taken into consideration, yet it is likewise to be
noted that this sole criterion on seniority in respect to termination due to
redundancy has not been seriously questioned, nor was it ever made an issue.  In fact petitioner MME in certain portions of
the evidence questioned that
some employees who were less senior were said to have been excluded from the
lists.

“The succeeding events after January 7, 1965 Agreement and before the strike of February 19, 1965 seem to be in a
confused state.  At one point petitioner
MME it would seem knew of this Agreement of January 6, 1965 and this was one of the reasons of the
strike (t.s.n 10, Nov. 6, 1965).  In
another instance the same peti­tioner said they saw this Agreement while they
were already on strike (t. s. n. 44, Dec. 2, 1965).  At any rate it would seem that the petitioner
MME was apprised of the terms of the January
6, 1965 Agreement in the conciliation talks prior to the strike (t.
s. n. 35, Dec. 3, 1965).  It is likely therefore, that one of the
reasons for the strike of the petitioner on Feb. 19, 1965 was their disagreement to the said Agreement
of Jan. 6, 1965.

“On February 15, 1965, the president of
petitioner MME sent a letter to the Superintendent of respondent’s Pandacan Terminal (Exh. ‘H’ and
‘6’) protesting the notice from respondent’s Dispatching Office that drivers of
tank trucks ‘are being required to proceed to their respective destination
without being accompanied by one (1) truck helper each, as usual.’ Petitioner
claimed that this was a change in a condition of employment which may not be
done without a Court order —
referring to the proceedings in 1459-MC quoted above.

“The following day, February
16, 1965, respondent company’s Terminal Superintendent
answered ‘That inasmuch as you
are bringing to our attention a grievance regarding working conditions, we
suggest that you follow the grievance proce­dure as stipulated in the Working
Agreement under Article ’12’ (Exhibit ‘8’).

“Another letter was sent by petitioner MME (Exh.
‘7’) stating therein the status quo mentioned during the hearing of Case No.
1459-MC, that no grievance could be possible, as petitioner claims that under
the contract [it is] the Citizens Labor Union and not the petitioner MME who
must bring the matter as a grievance and the former cannot be expected to file
the grievance because “it has in fact agreed to the abolition of the
position of truck helpers and other bargainable
positions in the contract.’ The letter, also stated the suspension of two (2)
truck drivers on February 16, 1966,
both MME members, for refusal to drive [without] the usual truck helpers.  And on February 17, 1965, two more drivers were suspended, for
the same reason.

“The above incidents starting with the hear­ing of February 22, 1965 up to the dismissal
of the four (4) truck drivers
mentioned, is (sic) claimed by the petitioner MME as one of their reasons for striking.

“On February 19, 1965 petitioner MME
struck.”

The trial court in its decision denied five of the demands, and
granted that against the reduction of the retirement age of the employees from
60 years to 55 years, subject to certain conditions therein stated, as follows:

“(1) By way of
supplementing the Partial Deci­sion of this Court of November 27, 1965 and
relative to Demands Nos. 1, 2, 3, 5 and 9.

“(a)   Respondent company is allowed to abolish the
positions of Assistant Truck Drivers or truck helpers and fillers;

“(b)   The can plant of respondent company is hereby
allowed to be closed and those employ­ees
if any, remaining as Can Plant Operators after the redundancy program is
completed, will be transferred to other plant duties and, when reassigned,
their position titles will not be changed nor will their wages presently earned be reduced;

“(c)   The terms and conditions of employment of
employees assigned to the Manila Inter­national Airport of JOCASP shall be the
terms embodied in paragraph 5(f) of the Return to Work Agreement of November 12, 1965;

“(d)   The immediate reinstatement of Rodolfo Espiritu and Reynaldo Recio is
denied.  Respondent company is, however,
enjoined to give preference to the re-employment of these persons;

“(e)   The Memorandum Agreement of Jan­uary 6, 1965
(Exhibit ‘B’) is hereby declared va­lid, without prejudice to issues arising
from the same and now pending in CIR Cases Nos. 3903-ULP, 3934-ULP,
1459-MC, 4289-ULP and 4301-ULP as mentioned in paragraph 7 of the Return to
Work Agreement of November 12, 1965;

“(2) Demand No. 7 is granted subject to the following
conditions:

“(a)   All employees who were retired at 55 years or
over and below 60 years shall be entitled to reinstatement, provided, any
benefits received by them on account of said retirement shall first be
reimbursed to respondent company, to start not less than sixty (60) days from receipt
of this Decision and to be deducted monthly from their pay envelopes in twelve
equal installments.”^[7]

Hence, these appeals by the parties, after the industrial court’s
en banc denial of their respective motions for partial reconsideration
of the portions of the decision adverse to them.

1. We shall start this review with the major demand of the
striking union (MME) for maintenance of the retirement age of the company’s
employees at age 60 in accordance with the collective bargaining agreement with
the CLU and for the reinstatement of those employees retired at an earlier age
under the company’s supplementary agreement of January 6, 1965 with the
CLU.  A resolution of this issue will help
in con­sidering the other demands as denied by respondent court and appealed
from in turn by the MME.  As stated
above, this was the only demand of the MME granted by respondent court and from
which the company has appealed.

Respondent court thus laid the basis for the granting of this
demand; “One of the provisions of the Agreement of November 8, 1963 is to the effect that regular
employees may continue to work up to the age of 60.  Then in the Memo­randum of Agreement of January 6, 1965, this age was re­duced
to 55 years.  It must be remembered that
the benefits and advantages of a Collective Bargaining Agreement once made by
the duly recognized bargaining representative are open and available to all
employees within the coverage of the agreement. 
The respondent company having agreed at one instance to the 60 years age
retirement cannot now renege on this provision no matter how monetarily
attractive is the retirement benefit.  It
is here where the Court should legiti­mately interfere because retirement is
more than a mere term or condition of employment.  It involves the livelihood and welfare of the
employee himself.  The same may be sub­ject
to bargaining or negotiations, but once agreed, every employee within the
appropriate unit who is expected to avail of such benefit cannot be deprived of
the same by sub­sequent negotiations of the representative union.” Respon­dent
court, however, ordered that the amounts received by the prematurely retired
employees whose reinstatement it had ordered should be reimbursed to the
company by deduction from their pay enveloped in twelve equal installments.

On appeal, the company contends that its retirement of such
employees at age 55 or over and below 60, for a period of one year as provided
for in its memorandum of agreement of January
6, 1965 with the CLU as the employ­ees’ bargaining agent, and in
pursuance of its legitimate redundancy program, was valid and legal.

No error was committed by respondent court since it correctly
held that as the retirement age of the company’s workers was definitely fixed
at 60 years in the supplemental agreement of November 8, 1963, such retirement
age, assur­ing the very livelihood and welfare of the employees and their
security of employment, became the law between the company and each of its
employees for the duration of the stipulated three-year period of their
collective bargaining agreement up to July 8, 1966.  The same could no longer be subject to
revision or reduction during the life of the agreement without the consent or
ratification of the employees, and no worker could be deprived of such vested
contractual right by subsequent unauthorized negotiations of the representative
union.^[8]

This view is further strengthened when it is taken into account
that in December, 1964, a good number of the company’s employees, said to be a
majority, disaffiliated from the CLU which had concluded the subsisting
agreement of April 8, 1963 and joined the MME; on January 7, 1965, the MME
filed with the industrial court its petition for certification election (Case
1459-MC) praying that it be certified, in lieu of the CLU, as the exclusive
bargaining agent of all the employees and author­ized to administer the
agreement during its remaining term on the ground that it represented the
majority of said employees and that the CLU had lost its majority status and
could no longer be considered as their bargaining representative; at the
certification election conducted by the Labor Department on March 22, 1965,
pursuant to the industrial court’s order, which the CLU boycotted, the MME
obtained the votes of more than one-half of the rank and file employees of the
ESSO Pan­dacan Terminal Unit eligible to vote (185
out of 202 employees who voted, from a total 351 employees eligible to vote)
and was certified on April 26, 1965 by the industrial court as the sole and
exclusive bargaining representative of the employees.

The case was elevated by the CLU to this Court by its petitions of
May 9, 1965 and June 10, 1965, both entitled Citizens Labor Union-CLU vs. C.
I. R.^[9]
Since the bargain­ing agreement had thereafter expired on July 8, 1966, and in
view of “the manifestation, advanced with vehemance,
of both the CLU and the ESSO that after the secret ballot election held on
March 22, 1965, the employee composition has subtantially
changed because a great number of the employees and laborers in the Pandacan Terminal unit have left their employment, retired,
or been compulsorily laid off with the approval of the CIR.  On its part, ES SO further claims that the
salient facts obtaining in the two cases before us have been so altered by the
lapse of time and by developments shaped and brought about by the parties
themselves, that ‘nothing will be gained if an altered factual situation is com­pelled
to await a decision applicable to an entirely different set of facts,'”
this Court ordered the remand of the cases to the industrial court for further
action as warranted by the environmental circumstances.

Against the above backdrop, the facts noted by the industrial
court that the agreement dated January 6, 1965 bet­ween the CLU and the company
was actually acknowledged before a notary public only on January 15, 1965
(after the MME’s petition for certification election
challenging the CLU’s major­ity status had been filed
on January 7, 1965) and that “it was only on the agreement of January 6,
1965 that the respondent company seemed to have actively and compulsorily
exercised its rights to terminate its employees under certain conditions due to
redundancy” gain great significance.

The company thereby at its own risk, aware as it was of the
binding effect of the retirement age of 60 fixed in the subsisting agreement,
which by its own terms “is the full settlement between the parties for the
duration (t)hereof” (Article XVI) and of the uncertain majority status of
the CLU by virtue of the disaffiliation of a great number of its members who
joined the MME, entered into the so-called supplementary agreement of January
6, 1965 and sought to enforce the reduced retirement age of 55 therein
provided, notwithstanding the ex­press disclaimer therein that it “shall not
in any way be con­sidered as a renegotiation or change in any
term or condition in the Working Agreement of April 8, 1963 . . . and that
said Working Agreement … will continue 
in full force and effect until its expiration date, without
modification of any kind what­ever.”

Prior to the agreement dated January 6, 1965 or January 15, 1965,
the date of its acknowledgment, as noted by the industrial court, the company
had not sought to actively and compulsorily retire its employees at 55 or to
terminate them under its so-called excess employees or redundancy program.  The split of its predecessor company, Stanvac, into Esso and Mobil Philippines,
which caused its so-called redundant employees allegedly by its absorption of
all the working force in Luzon, had occurred since 5
years ago in 1960.  Yet, it had renewed
on April 8, 1963 a
three-year collective bargaining agreement with the CLU as the full settlement
of the terms and conditions of employment of its employees for the duration of
the agreement.

The company was apparently satisfied with the status quo
of its relations with the employees as long as they all pertained to the CLU,
for it had agreed to no cutbacks of redundant employees, nor does it claim to
have incurred losses in its business.^[10]
Yet, when the MME came on the scene and claimed to be entitled to be the
recognized representative of the employees under the subsisting agreement, it
forced the situation and entered into the agreement of January 6, 1965 with the
CLU to advance the retire­ment age to 55 and to enforce other cut-backs of its
employees, knowing full well that the very authority of the CLU to represent
the employees who had precisely disaffiliated from the CLU and joined the MME
was open to serious question and was being ven­tilated before the industrial
court.

Then, too, even if the CLU could legally be considered by it as
the representative of the employees, the CLU had no authority to negotiate on,
much less waive, the vested contractual right of the employees to their
security of employment up to age 60.  It
hardly seems disputable, then, that its agreement of January 6, 1965 with the CLU served both the
company’s and the CLU’s ends to thwart the majority
support for the MME, which had won the certification election held on March 22, 1965.  Thus, in their com­mon stand in CLU vs.
CIR, supra, with the passage of time, they did succeed in effect in
nullifying the results of the election and by virtue of the company’s sudden
realization of its redundancy program and unrelenting enforcement thereof,
pursuant to its January 6, 1965 agreement with the CLU, were able to use it to
represent to this Court in the said case that “the employee com­position
has substantially changed because a great number of the employees and
laborers in the Pandacan Terminal unit have left
their employment, retired, or been compulsorily laid off with the approval of
the CIR.”

The industrial court’s disauthorization
of the advanced retirement must, therefore, be affirmed.  However, in view of the time that has elapsed
since its decision of April 27, 1966 without its reinstatement order for the
employees prematurely retired at 55 years or over and below 60 years having
been implemented due to this appeal, and they must by now have reached the
stipulated retirement age of 60, the award should be modified to the effect
that all such compulsorily prematurely retired em­ployees shall be paid back
wages from date of such premature retirement to the date of their contractual
compulsory retirement at age 60; they shall be entitled likewise to the
retirement benefits stipulated under the collective bargaining agreement of
April 8, 1963 or subsequent renewals thereof from which must be deducted,
however, the amount of any benefits received by them on account of and at the
time of their premature retirement.

2. Conformably to the foregoing, respondent court’s denial of the MME’s two demands against the abolition of the positions of
assistant truck drivers or truck helpers and fillers and against the company’s
change of the terms and conditions of employment of employees assigned to the
MIA or JOCASP (demands Nos. 1 and 3, resolved in paragraph 1 (a) and (c) of the
decision’s dispo­sitive part, supra) should be
set aside.

The two separate positions of assistant truck drivers or truck
helpers and fillers, with their corresponding wage rates, were duly provided
for and defined in the collective bargaining agreement.  The assistants’ work in the care of the huge
delivery trucks, some of whom have 24,000
liters capacity and several compartments, and in the unloading of
products at delivery points and standing by
with a fire extinguisher while the driver operates the truck’s pumping
unit for unloading, the fillers’ work of loading the tank trucks at the
terminal compound, and the transfer of their duties to the driver alone, who
was given an increased wage of P1.60 a day for the filling of the truck and
driving without a helper, were discussed by the parties at the trial.

The MME also objected to the assignment to the Manila In­ternational
Airport or JOCASP units of the company of employees formerly assigned to the Pandacan terminal, without transportation and meal
allowances which were discontinued by the company, not­withstanding the
additional financial burden on the employees who had made their residence at Pandacan, which instead gave them a wage increase of P1.60
per day.

Respondent court denied the MME’s
demands, ruling that it did not wish to substitute its judgment “for a purely
management function who is in a better position to determine its day to day
business operations.”

The actions of the company in abolishing the positions and
withdrawing the benefits previously enjoyed by the employees by virtue of its agreement of January 6, 1965 with
the CLU, whose right to represent the employees was being challenged by the
MME, were tainted, however, as stated above, by their common end of thwarting
the majority support for the MME. 
Indeed, as of the time of the execution of said agreement of January 6,
1965, where­by the CLU strangely enough yielded hard-won benefits and terms of employment in the collective
bargaining agreement, the record does not indicate that the company was
justified in considering the CLU as the majority bargaining representative, for
its loss of majority status was in fact borne out by the results of the March 22, 1965 certification
election.  The benefits of the subsisting
collective bargaining agreement may not be peremptorily modified without the
30-day notice required by law^[11]
nor summarily set aside and disregarded, since relations between capital and
labor are not merely contractual but are impressed with public interest such
that labor contracts must yield to the common good.^[12]
There is no claim here that the employees had been duly notified by the CLU of,
much less that they had ratified the modifications provided in the January 6, 1965 agreement which worked
against their interest.^[13]

3. Respondent court’s resolution of the MME’s
two other demands (Nos. 2 and 5, resolved in paragraph 1 (b) and (d) of the
decision’s dispositive part, supra), allowing
the closure of the company’s can plant and denying the reinstatement of the MME’s vice president and secretary, the former having
voluntarily ap­plied for and secured termination benefits, apparently bear the MME’s acquiescence. 
They have not been assigned as errors in the MME’s
brief and respondent’s court’s action on these two items is affirmed.

4. On the MME’s sixth demand (No. 9),
respondent court’s resolution declared valid the memorandum agreement of
January 6, 1965 assailed by the MME “without prejudice to issues arising from
the same and now pending in CIR Cases Nos. 3903-ULP, 3934-ULP, 1459-MC,
4289-ULP and 4301-ULP as mentioned in paragraph 7 of the Return to Work Agreement
of November 12, 1965.” This appears to be in consonance with the parties’
express reservation for separate determination of other issues in the other
cases pending in other branches of the industrial court, dealt with in the
first part of this decision.  The MME in
its brief has not raised specific particulars wherein its members have been pre­judiced
by said agreement and on which the Court can pass judg­ment.  Respondent court, while declaring the said
agreement valid, made the express reservation that it was not passing upon the MME’s charges of discrimination on the part of the company
in the imple­mentation of the agreement and expressly held that “Both
parties it must be reiterated, have reserved these discriminatory aspects for
determination in the different cases now pending, also in this Court.  Since these matters are not necessary in the
determination of the issues before this Court certainly their final resolution
are left to the various cases in the other salas.”
Respondent court’s action, as thus qualified, is therefore affirmed.

5. With regard to the MME’s demand that
the company turn over to it the union dues checked off under the company’s
collective bargaining agreement with the CLU from employees who disaffiliated
from CLU and instead joined it (MME), res­pondent court had dismissed the same,
on the ground that its resolution properly pertained to the certification
election case between the rival unions. 
Respondent court committed no error in refusing MME’s
demand for the turn over to it of the checked off dues, since its right thereto
depended upon its officially re­placing the CLU as the certified bargaining
representative of the employees.

The MME contends in its brief on appeal, however, that respondent
court erred in allowing the company to continue checking off the union dues for
the CLU despite the employees disaffiliation from said union and their written
individual revo­cation of their previous check-off authorizations.  The company in turn justified its action of
continuing to make such deductions and remitting the checked-off dues to the
CLU on the ground that its collective bargaining agreement with the CLU
provided that the check-off authorization would be irrevocable for the
three-year duration of the agreement as a security for the union (CLU).

It was error on the part of respondent court to allow the company
to continue the check off of dues for the CLU of em­ployees who had withdrawn
their authorization by virtue of their affiliation with the MME.  As stated by Justice Montemayor
in Pagkakaisa.. (PAFLU) vs. Enriquez,^[14]
the employees’ check off authorization, even if declared irrevocable, is good
only as long as they remain members of the union concerned, because as such
members they were obliged to pay the corres­ponding dues and assessments to
their union; “(H)owever, the moment that they
separated from and left the union and joined another labor organization, then
they were no longer obliged to pay said dues and assessments; naturally, there
would be no longer any reason or occasion for the company to continue mak­ing
deductions.”

However, since after the expiry of the CLU’s
bargaining agreement on December 31, 1966, respondent court had direct­ed that
all union dues checked off from all employees be depo­sited in court pending
the results of the new certification elec­tion (Case No. 1820-MC) and the
company duly complied there­with,^[15]
the question has become moot.

ACCORDINGLY, judgment is hereby ren­dered affirming
the decision appealed from insofar as paragraph 1, sub-paragraphs (b), (d) and
(e) as well as paragraph 2, sub-para­graph (a) of the dispositive
part thereof (supra)^[16]
are concerned; the award in said paragraph 2(a) disauthorizing
the advanced retirement of employees is however modified in the manner
indicated in the last paragraph of paragraph 1 of this decision.^[17]
The respondent court’s denial of the two demands covered in paragraph 1(a) and
(c) of the dis­positive part of the appealed decision
is set aside, and the abolished positions and with­drawn benefits are
ordered restored, as prayed for.  With
costs in both cases against Esso Standard Eastern,
Inc.

Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal Zaldivar, Ruiz Castro, Fernando, Villamor,
and Makasiar,
JJ., concur.

Barredo, J., reserves his vote.

^[1]
These four demands were numbered Nos. 4, 8, 10 and 11 in the list filed by the
union.

^[2]
The eleventh demand (No. 6) was that the company should not declare any
position redundant without notice or hearing the side of the unions.  It was considered by the trial court as a restatement
of the union’s stand against the company’s “redundancy program” for
reassignment of excess employees and abolition of certain job positions, and is
taken up in the trial court’s decision.

^[3]
“SEC. 10.  Labor Disputes in
Industries Indispensable to the National Interest. — When in the opinion
of the President of the Philippines there exists a labor dispute in an industry
indispensable to the national interest and when such labor dispute is certified
by the President to the Court of Industrial Relations, said Court may cause to
be issued a restraining order forbidding the employees to strike or the
employer to lock­out the employees, pending an investigation by the Court, and
if no other solution to the dispute is found, the Court may issue an order
fixing the terms and conditions of employment.

^[4]
Commonwealth Act No. 103.

^[5]
Idem, section 13; Luzon Stevedoring Corporation vs. C.I.R., 15
SCRA 660, 677 (Dec. 31, 1965).

^[6]
See Phil. Steam Navigation Co. vs. Phil. Marine Officers Guild,
et al., 15 SCRA 174 (Oct. 29, 1965), where various unfair labor practices filed
by the union against three shipping companies as well as against the union were
jointly tried with the case over the certified industrial dispute, and a single
decision rendered resolving all the cases and issues.

^[7]
Emphasis supplied.

^[8]
See Heirs of T. M. Cruz vs. C.I.R. and Bulos
vs. C.I.R., 30 SCRA 917 (Dec.
27, 1969) and La Campana Food Products
Inc. etc. Employ­ees’ Association vs. C.I.R., 18 SCRA 314 (May 22, 1969).

^[9]
L-24320 and L-24421, jointly decided.  18
SCRA 624 (Nov. 12, 1966);
emphasis supplied.

^[10]
LVN Pictures Employees and Workers Assn. vs. LVN Pictures, Inc., 35 SCRA
147 (Sept. 30, 1970).

^[11]
“SEC. 13. x x
x (W)here there is in effect a collective
bargaining agreement, the duty to bargain collectively shall also mean that
neither party shall terminate or modify such agreement, unless it has served a
written notice upon the other party of the proposed termination or modification
at least thirty days prior to the expiration date of the agreement, or in the
absence of an ex­press provision concerning the period of validity of such
agreement prior to the time it is intended to have such termination or
modification take effect. ” (RA 875).

^[12]
Majestic & Republic Theaters Employees Assn. vs. CIR, 4 SCRA 457
(1962), citing Art. 1700, Civil Code.

^[13]
See Heirs of T. M. Cruz vs.
CIR and Bulos vs. CIR, supra, fn. 8.

^[14]
108 Phil. 1010, 1018.

^[15]
ESSO’s brief in L-26346, p. 91.

^[16]
At pages 12 and 13 of this decision.

^[17]
At page 17 of this decision.