ERLANGER & GALINGER, INC., AND L.B. NESTLE, PETITIONERS, VS. COURT OF INDUSTRIAL RELATIONS AND EULOGIO P. FLORES, RESPONDENTS.

On November 9, 1954, upon charges filed by herein respondent Eulogio P.
Flores, and after preliminary investigation, a complaint for unfair labor
practice was filed m the Court of Industrial Relations by an acting prosecutor
of that court against Erlanger and Galinger, Inc., a corporation organized under
Philippine laws and its general manager, L. B. Nestle. The complaint alleged
that the corporation and general manager, thru their officers, supervisors and
agents, initiated and assisted in the formation of a labor organization composed
of their employees and supervisors known as the Kontiki Employees Association
and continuously thereafter interfered with its administration, supported,
controlled and dominated it, thereby violating the employees’ right to
self-organization as provided for in section 3 of Republic Act 875; that on or
about July 10, 1954, by reason of the union activities of complainant Eulogio P.
Fiores after he was employed by respondents as credit investigator-collector,
particularly his efforts as legal adviser of the Association, ,fhe latter
summarily and discriminatorily discharged him and appointed to his posi-ti|n two
persons receiving higher salaries; and that after sara discharge, respondents
also threatened to dismiss Gerardo Cruz and Victor Torio, president and
vice-president of the Association.

Answering the complaint, the herein petitioners, thru counsel, denied the
charge of unfair labor practice and as special defenses alleged that the
separation of Eulogio P. Fiores was justified, and that the filing of the
complaint by an acting prosecutor of the Industrial Court was vio-lative of the
law on due process. The issues having thus been joined, the case was.assigned
for hearing. Thereafter, Atty. Pedro Perez, one of the examiners, submitted his
report. After examining the record, Associate Judge Emilio C. Tabigne of the
Industrial Court, found the findings,of fact and conclusions arrived at by Mr.
Perez in his report to be fully supported by the evidence, and adopting the
same, rendered decision finding the company and its manager guilty of unfair
labor practice as charged and ordering them” to cease and desist therefrom and
to reinstate immediately Eulogio P. Flores to his former position, with back
salaries from the date he was discharged until he is fully reinstated, less
whatever earnings he might have received elsewhere during his discriminatory
lay-off.

Not satisfied, the respondents filed a motion for reconsideration and new
trial, alleging that the decision is contrary to law and the evidence adduced at
the trial. They also alleged that after the case had been submitted for
decision, the company was constrained to disband its personnel in its radio and
refrigerator departments as the Central Bank banned the importation of radios
and did not grant to it dollar allocations for the importations of refrigerators
(both of which items constituted the great bulk of the company’s business during
the employment of Flores), so that to recreate the former position of Flores as
credit investigator-collector pursuant to the decision to reinstate him would
not only be unjustifiable but entirely unjust. Finding the motion meritorious,
the court en banc, under date pn May 10, 1957, resolved to remand the record of
the case to the trial court for the reception of additional evidence.

A hearing was accordingly conducted, this time through Hearing Examiner
Mariano Tuason. After the parties had submitted memorandum and reply memorandum
in support of their respective positions, the Industrial Court in an order dated
November 14, 1958 affirmed its finding that the respondents were’ guilty of the
unfair labor practice acts complained of and that the motivating factor that led
to the dismissal of Eulogio Flores was his union activities. Observing, however,
that the business of the company had suffered a recession and that its
collectible accounts had suffered a sharp and continuous decline in view of the
banning of the importation of finished radio and refrigerator, the court
modified its previous decision by eliminating therefrom its order to reinstate
Flores and merely requiring the company to pay him back wages from July 10, 1954
to June 30, 1957, inclusive, less whatever he may have earned within said
period. After the lower court en banc denied their final motion for
reconsideration, the company and its manager brought the case to this Court for
review.

Petitioners in the first place question the manner in which the prosecution
of the case had been conducted, alleging that with the filing of the complaint
by the very same acting prosecutor of the Industrial Court who conducted the
preliminary investigation, the reception of evidence by hearing examiners of the
same court, and the adoption by Judge Tabigne of the report of Hearing-Examiner
Pedro Perez, the said Industrial Court assumed the role of accuser, prosecutor
and judge at the same time. We find the objection to be without legal basis. The
procedure followed by the Industrial Court was in accordance with section 5(b)
of the Industrial Peace Act (Republic Act No. 875), which reads In part as
follows:

“* * * Whenever it is charged by an offended party or his representative that
any person engaged or is engaging in any such unfair labor practice, the Court
or any agency or agent designated by tiie Court must investigate such charge and
shall have the power to issue and cause to be served upon such person a
complaint stating the charges in that respect and containing a notice of hearing
before the Court or a member thereof, or before a designated Hearing Examiner at
the time and place fixed therein not less than five nor more than ten days after
serving the said complaint. * * *.”

Under the above legal provision, it is apparent that the Court of Industrial
Relations, in the exercise of its investigatory powers, in unfair labor practice
cases, may designate its acting prosecutor to conduct an investigation of the
charges filed by the aggrieved party, and later have the complaint filed on the
basis of the result of said investigation, requiring the respondent to file his
answer and then hear both parties thru designated hearing examiners. Such
procedure has been sanctioned by this Court in the case of Natioinal Printing
Workers vs. Asia Printing, et al. (99 Phil., 589; 52 Off. Gaz., [12]
5858). It is true that the prosecutors and hearing examiners are officers of the
court. Their functions and duties as such are, however, well defined in the law
and their findings are not conclusive upon the Industrial Court, which has the
discretion to accept or reject them. There is, therefore, no reason to fear that
the parties who undergo trial under the procedure as above stated are denied the
constitutional guarantee of due process.

The fact that the decision rendered by the court was based upon the report of
Hearing Examiner Perez who heard the evidence only in part is of no moment, for
the court below studied and examined not only the evidence received by said
hearing examiner but also that presented before the others and found that the
findings and conclusions contained in the report conform to its own. This court
has already ruled in the case of Indias vs. Philippine Iron Mines, Inc.
(101 Phil., 297; 54 Qff. Gaz., [6] .1817), that “where the Court of Industrial
Relations approved the report of the hearing examiner after a perusal of the
record of the case, this pre-supposes that it had examined the evidence and
found no justification in modifying his findings and conclusions. It is not
necessary for the court to make fn the order its own discussion of the evidence
or its own findings of fact.”

Petitioners also contend that the Industrial Court erred in awarding back
wages to respondent Eulogio P. Flores because during his employment he used
company time for his private interest. To support this contention, petitioners
cite the testimony given by said respondent’s wife in Civil Case No. 24387 of
the Court of First Instance of Manila that during the period from August, 1953
to July, 1954, her husband helped her at their store in Divisoria. Said
testimony, however, was not admitted as evidence by the lower court, and we
think correctly, for the witness was not presented in court and there is no
showing that she is deceased, or out of the Philippines, or unable to testify
(Sec. 37, Rule 123, Rules of Court.). At any rate, assuming that respondent
Eulogio P. Flores, during his employment with the company, actually helped his
wife in the latter’s business, it has not been shown that this had in any way
adversely affected the work of said respondent as credit investigator-collector.
As a matter of fact, the said respondent was once given by the company a reward
fojritns good work and efficiency.

Neither may it validly be argued that the recession in the business of the
company should defeat respondent Eulogio P. Flores’ right to back wages. The
unfavorable conditions in the company’s business and the consequent reduction of
its collectible accounts, as held by the lower court, may not justify
reinstatement, but they certainly are not sufficient grounds to deny back wages
to respondent Stores who was illegally dismissed on account of union
activities.. To hold otherwise would render the provisions of the Industrial
Peace Act on unfair labor practice nugatory.

Wherefore, the decision and order of the Court of Industrial Relations are
affirmed, with- costs against the petitioners.

Paras, C.J., Bautista Angelo, Labrador, Reyes, J.B.L., Barrera,
Paredes, and Dizon,,JJ., concur.

Decision and order affirmed.