G.R. No. L-13806. May 23, 1960
PRICE STABILIZATION CORPORATION, PETITIONER, VS. COURT OF INDUSTRIAL RELATIONS AND PRISCO WORKERS’ UNION, ET AL., RESPONDENTS.
BARRERA, J.:
Stabilization Corporation (PRISCO) from the decision of the Court of
Industrial Relations (in Case No. 840-V [6]) of December 27, 1957.
It appears that under date of February 15, 1955, respondent PRISCO
Workers’ Union, a labor organization duly registered with the
Department of Labor, filed with respondent court, a petition praying
that herein petitioner-employer PRISCO be ordered to pay its present
employees, claimants-members of the said Union, their basic pay and at
least 25 per cent additional compensation for one hour overtime work
they had previously rendered as security guards of petitioner, from
April 17, 1953 to January 13, 1954, and the additional compensation of
at least 25 per cent for the work they have been rendering on Sundays
and legal holidays, from March 7, 1954 and on.
On March 15, 1955, the petitioner filed an answer denying respondent
Union’s claim for payment of one hour overtime work, asserting that
such overtime, if rendered, not having been authorized; although some
of the said claimants had rendered work on Sundays and legal holidays,
the same had already been paid from March 6, 1954; and finally alleging
that the said claim for work on Sundays and legal holidays had already
been withdrawn.
The case was thereafter heard and, after hearing, respondent court,
on December 27, 1957, issued an order requiring petitioner to pay the
said claimants, members of respondent Union, their basic pay and 25 per
cent additional compensation for the one hour overtime work they had
rendered from April 16, 1953 to January 13, 1954. However, for lack of
evidence and in view of a petition signed by 59 of the 131 claimants
withdrawing their claim for pay for work performed on Sundays and legal
holidays, the court dismissed the second claim.
On January 8, 1958, petitioner corporation filed a motion for
reconsideration of said order, which motion was resolved by respondent
court, en banc, as follows: 2 judges voting for straight
denial; 2 judges voting for the setting aside of the order as null and
void on the ground of lack of jurisdiction; and 1 judge concurring in
the denial of the motion for reconsideration, on the ground that the
question of lack of jurisdiction has not been raised in the pleading.
As a result; petitioner corporation has filed this present petition.
There are 2 questions of law to be determined in this case, to wit:
(1) whether respondent court had jurisdiction over the present claim
for overtime pay filed by respondent Union; and (2) whether the same
court correctly applied Articles 1393 and 1396 of the new Civil Code to
the case.
As to the first question, there still seems to be some lack of clear
and definite understanding of the jurisdiction of the Court of
Industrial Relations, with regards to money claims of laborers or
employees against their employers. The fact that in the present case
the judges themselves of the Court of Industrial Relations are divided
on this matter, attests to the existence of such misapprehension. It is
well therefore to review some of the leading decided cases touching on
this point, for the purpose of clarifying this fundamental question.
In the PAFLU vs. Tan Case,[1]
we held that the Court of Industrial Relations has jurisdiction over
cases (1) when the labor dispute affects an industry which is
indispensable to the national interest and is so certified by the
President to the industrial court (Sec. 10, Rep. Act No. 875) ; (2)
when the controversy refers to minimum wage under the Minimum Wage Law
(Rep. Act No. 602); (3) when it involves hours of employment under the
Eight-Hour Labor Law (Com. Act No. 444); and (4) when it involves an
unfair labor practice (Sec. 5-a, Rep. Act No. 875).
Later, in the case of Detective and Protective Bureau Incorporated vs. Felipe Guevara, et al[2]
involving claims for refund of deductions from respondents’ salaries,
payment of additional compensation for work performed on Sundays and
holidays, and for night work, and grant of vacation and sick leave pay,
this Court held that the Court of Industrial Relations had
jurisdiction, inasmuch as the claimants were all employees of the
Detective and Protective Bureau, Inc, at the time of the filing of
their claims in Case No. 764-V in the Court of Industrial Relations. To
the same effect is the case of Isaac Peral Bowling Alley vs. United Employees Welfare Association, et al. (102 Phil., 219).
Subsequently, in the case of Santiago Aguilar vs. Jose
Salumbides (G.R. No. L-10124, prom. December 28, 1957), this Court
declared that the Court of Industrial Relations had no longer
jurisdiction to hear and determine the claims of ex-employees against
their former employer for overtime, wage differential, and separation
pays.
Again, in the cases of Roman Catholic Archbishop of Manila vs. Yanson, et al. (G. R. No. L-12341) and Elizalde and Co., Inc. vs. Yanson, et al. (G. R. No. L-12345) jointly decided on April 30, 1958, this Court, in a unanimous opinion, declared:
“In the present case, it is apparent that the
petition below is simply for the collection of unpaid salaries and
wages alleged to be due for services rendered years ago. No labor
dispute appears to be presently involved since the petition itself
indicates that the employment has long terminated and petitioners are
not asking that they be reinstated. Clearly, the petition does not fall
under any of the cases enumerated in the law as coming within the
jurisdiction of the Industrial Court, so that it was error for that
court not to have ordered its dismissal.Indeed, even under
Commonwealth Act No. 103 as amended by Com. Act No. 559, the court
below could not have taken cognizance of the present case. For in order
for that court to acquire jurisdiction under that law, the requisites
mentioned in section 4 thereof must all be present, one of them being
that there must be an industrial or agricultural dispute which is
causing or likely to cause a strike or lockout. With the employment
already terminated years ago, this last mentioned requisite cannot be
supposed to still exist.”
Then came the decision in the NASSCO vs. Almin, et al.
case (104 Phil., 835; 56 Off. Gaz. [9] 1879) in which this Court upheld
again the jurisdiction of the Court of Industrial Relations to hear and
determine the claim of respondents at the time presently and actually
in the employ of the petitioner—for overtime compensation for work they
were then rendering since 1950 on Sundays and holidays and even at
night.
On the same theory, this Tribunal, in the Chua Workers’ Union (NLU) vs. City Automotive Company, et al. case[3]
where the claimants for differential and overtime pays were former
employees of the respondent company, ruled that the Court of industrial
Relations had no jurisdiction.
The latest case is that of Monares vs. CNS Enterprises, et
al. (G.R. No. L-11749, prom. May 29, 1959) in which this Court,
speaking through the Chief Justice, held that the Court of Industrial
Relations and not the Court of First Instance, has jurisdiction where
the claimant, although no longer in the service of the employer, seeks
in his petition the payment of differential and overtime pay and his reinstatement.
Analyzing these cases, the underlying principle, it will be noted in
all of them, though not stated in express terms, is that where the
employer-employee relationship is still existing or is sought to be
reestablished because of its wrongful severance (as where the employee
seeks reinstatement), the Court of Industrial Relations has
jurisdiction over all claims arising out of, or in connection with
employment, such as those related to the Minimum Wage Law and the
Eight-Hour Labor Law. After the termination of the relationship and no
reinstatement is sought, such, claims becomes mere money claims, and
come within the jurisdiction of the regular courts.
We are aware that in 2 cases,[4]
some statements implying a different view have been made, but we now
hold and declare the principle set forth in the next preceding
paragraph as the one governing all cases of this nature.
It appearing that in the present case, the respondents claimants
are, or at least were, at the time of presenting their claims, actually
in the employ of herein petitioner, the Court of Industrial Relations
correctly took cognizance of the case.
In respect of the second issue, it appears that claimants security
guards have been employed and required to observe a 24-hour guard duty
divided into 3 shifts of 8 hours each. On April 15, 1953, the Assistant
Chief Security Officer of petitioner corporation, acting for the Chief
Security Officer, issued a Memorandum (Annex A), directing the Security
guards to report for duty 2 hours in advance of the usual time for
guard work. Pursuant thereto, claimants had been rendering such
overtime work until January 13, 1954, when the order was revoked after
a change of management.
Petitioner, however, contends that said memorandum of the Assistant
Chief Security Officer was issued without authority and, therefore, it
is not bound to pay for the alleged overtime. But, as found by
respondent court, shortly after the enforcement of the aforementioned
memorandum, the security guards protested to the management of
petitioner corporation, more particularly to Mr. Santiago de la Cruz,
General Manager, Atty. Graciano Borja, Director, and Mr. Espiritu,
Director. Instead of revoking said memorandum on the ground that it was
unauthorized by the management, General Manager De la Cruz told the
security guards that the reason why it was being enforced, was to
discipline them and that their work was only light and that 1 hour was
of no importance. This, the lower court held, amounted to a tacit
ratification of the memorandum, on the part of the said official who,
as claimed by petitioner itself, had the power to validly act for it.
(See also Sec. 6, Exec. Order No. 350, series of 1950.) Hence, the
lower court concluded, applying the provisions of Articles 1393 and 1396[5]
of the new Civil Code, that any defect, if any, which said memorandum
of the Assistant Chief Security Officer may have at the time it was
constituted, was, therefore, corrected.
But petitioner urges that Articles 1393 and 1396 refer to voidable
contracts and the questioned memorandum is not such a contract but an
order issued by one not authorized and, therefore, is illegal and
cannot be ratified tacitly.
This view is without merit. There is no question that a contract of
employment exists between petitioner and claimants-respondents, and
that pursuant to the terms thereof, the latter are to render 8 hours
labor. When petitioner’s official required respondents to render an
additional hour work, and the respondents had to comply (as
non-compliance was punishable and actually punished with disciplinary
action), a supplemental contractual obligation was created both under
the terms of the original contract of employment and of the Eight-hour
Labor Law, that such additional work was to be compensated. That the
memorandum giving rise to this situation was originally authorized, did
not make it illegal to the extent of not being capable of ratification
by the duly authorized official, the General Manager of petitioner
corporation. Hence, the lower court correctly applied Articles 1393 and
1396, upon the facts found by it in this case and amply supported by
the record.
Wherefore, finding no error in the decision appealed from and the
resolution upholding it, the same are hereby affirmed, with costs
against the petitioner. So ordered.
Paras, C. J., Bengzon, Montemayor, Bautista Angelo, Labrador, Concepcion, and Gutierrez David, JJ., concur.
Reyes, J.B.L., J., on leave, took no part.
[1] 99 Phil., 854; 52 Off. Gaz. (13) 5836.
[2] G.R. No. L-8738, prom. May 31, 1957.
[3] G.R. No. L-11655, prom. April 29, 1959.
[4] Mindanao Bus Employees Labor Union (PLUM) vs. Mindanao Bus Co., et al., 102 Phil., 1179; Gomez vs. North Camarines Lumber Co., 104 Phil., 294; 56 Off. Gaz, (12) 2630.
[5] “ART. 1393.
Ratification may be affected expressly or tacitly. It is understood
that there is a tacit ratification if, with knowledge of the reason
which renders the contract voidable and such reason having ceased, the
person who has a right to invoke it should execute an act which
necessarily implies an intention to waive his right.”
“Art 1396. Ratification cleanses the contract from all its defects from the moment it was constituted.”