VISAYAN BICYCLE MANUFACTURING CO., INC., PETITIONER, VS. NATIONAL LABOR UNION AND COURT OF INDUSTRIAL RELATIONS, RESPONDENTS.

Visayan Bicycle Manufacturing versus National Labor Union

The Case

This is a petition for review brought by the Visayan Bicycle Manufacturing Company against the National Labor Union and the Court of Industrial Relations. The company asks the Supreme Court to overturn a decision of the Court of Industrial Relations finding it guilty of unfair labor practice for dismissing two union officers, Fulgencio Besana and Felicisimo Rodiel. The case matters because it shows how the Supreme Court treats an employer's claim that a dismissal rested on a valid company rule, when the evidence shows the rule was merely a pretext and the true motive was the employees' union activity.

Procedural History

The National Labor Union, on behalf of the Visayan Bicycle Employees and Workers Union and of Besana and Rodiel, filed a complaint for unfair labor practice against the company in the Court of Industrial Relations. After trial, the presiding judge of that court rendered a decision in favor of the complainant union, ordering the company to cease and desist from the unfair labor practices and to reinstate Besana and Rodiel with backwages. The company moved for reconsideration but reserved the right to file a supporting memorandum later, and then asked for an extension of time to file that memorandum. The Court of Industrial Relations en banc, following its standing no-extension policy, denied the extension and thereafter denied the motion for reconsideration. The company then filed this petition for review with the Supreme Court.

Facts

In November 1958 the workers of the Visayan Bicycle Manufacturing Company formed their union, the Visayan Bicycle Employees and Workers Union, with Pedro Evangelista as president. The union and the company signed a collective bargaining agreement providing for union security, check off, wage increases, and vacation and sick leave. In the years that followed, the union held elections, and Fulgencio Besana and Felicisimo Rodiel came to serve as vice-president and secretary respectively.

In February 1960 the union's executive board, headed by Besana acting as president, affiliated the union with the National Labor Union. The company resisted. Its manager, Co Hing, warned the officers responsible for the affiliation that if they did not withdraw the union from the National Labor Union, he would take steps to dismiss them. The union demanded enforcement of the collective bargaining agreement, the company refused, and the union filed a notice to strike. Conciliation hearings were held, but the company still refused.

On April 25, 1960, Besana and Rodiel figured in a fight with two other employees within the premises and during working hours, and the company dismissed them that same day, citing a company rule penalizing fighting during working hours or on company premises. The evidence later showed, however, that the two other employees, Saturnino Reyes and Silvestre Pacia, had been hired only within that week, and that they had provoked Besana and Rodiel into a pre-arranged fight as part of a company strategy to create an apparently lawful cause for dismissal. Besana and Rodiel had never before figured in similar incidents in their many years with the company, and the company conducted no investigation. The manager himself admitted that Besana was dismissed because he was a hard-headed leader of the union.

Issues

• Whether or not the Court of Industrial Relations abused its discretion in denying the company's motion for extension of time to file a memorandum in support of its motion for reconsideration.
• Whether or not the company's dismissal of Besana and Rodiel constituted unfair labor practice.

Applicable Provisions

Section 4 of Republic Act 873, the Industrial Peace Act, defines unfair labor practices of an employer, and its first paragraph provides:

It shall be unfair labor practice for an employer to interfere with, restrain or coerce employees in the exercise of their rights guaranteed in section three.

This paragraph bears on the case because the company's dismissal of the two union officers interfered with and restrained employees in the exercise of their right to self-organization.

The fourth paragraph of the same section provides:

It shall be unfair labor practice for an employer to discriminate in regard to hire or tenure of employment or any term or condition of employment to encourage or discourage membership in any labor organization.

This paragraph bears on the case because the dismissal was discriminatory, resting solely on the employees' actuation as union officers.

Section 3 of the same Act, which the first paragraph of Section 4 protects, provides:

Employees shall have the right to self-organization and to form, join or assist labor organizations of their own choosing for the purpose of collective bargaining through representatives of their own choosing and to engage in concerted activities for the purpose of collective bargaining and other mutual aid or protection.

This provision bears on the case because the dismissed employees were being punished precisely for exercising the rights it guarantees.

Ruling

On the first issue, the Court held that the denial by the Court of Industrial Relations of a motion to extend the ten-day period to file arguments in support of a motion for reconsideration, pursuant to its standing rule against such extensions, does not constitute abuse of discretion. The first issue had, in fact, already been settled in prior cases.

On the second issue, the Court held that the dismissal of Besana and Rodiel constituted unfair labor practice. The findings of the Court of Industrial Relations were supported by substantial evidence: the fight was pre-arranged and provoked by two employees hired only within that week, as part of a company strategy to provide an apparently lawful cause for dismissal. The two had no prior record of similar incidents, the company conducted no investigation, and the manager admitted that Besana was dismissed because he was a hard-headed leader of the union. The Court stressed that the so-called violation of company rules having been brought about by the company itself, it cannot be regarded as a ground to punish the employees. The Court quoted Rothenberg on Labor Relations to the effect that if the true and basic inspiration for the employer's act is derived from the employee's union affiliations or activities, the assignment by the employer of another reason, whatever its semblance or validity, is unavailing. Since the only reason for the dismissal was in fact the employees' actuation as officers of the union, the dismissal was clearly discriminatory.

Doctrine

An employer commits unfair labor practice under Section 4, paragraphs 1 and 4, of the Industrial Peace Act when it dismisses employees because of their union activities, even if it assigns another reason for the dismissal. Where the true and basic inspiration for the employer's act is the employee's union affiliation or activity, the assignment of another reason, whatever its semblance or validity, is unavailing. A company rule violated by employees cannot serve as a ground to punish them where the violation was brought about by the company itself, as when it hires provocateurs to create an apparently lawful cause for dismissal. And the denial by the Court of Industrial Relations of a motion to extend the period to file arguments in support of a motion for reconsideration, pursuant to its standing rule against such extensions, does not constitute abuse of discretion.

Disposition

The Supreme Court affirmed the decision and resolutions appealed from, with treble costs against the petitioner company.

Remember This

Memorize this line: if the true and basic inspiration for the employer's act is the employee's union activity, the assignment of another reason, whatever its semblance or validity, is unavailing. Examiners use this case to test the pretext doctrine in unfair labor practice and the rule that a company rule cannot be invoked against employees when the company itself manufactured the violation.