FREE TELEPHONE WORKERS UNION, PETITIONER, VS. PHILIPPINE LONG DISTANCE TELEPHONE COMPANY, RESPONDENT.

This is an appeal by certiorari to review the partial decision of
the Court of Industrial Relations dated November 9, 1964 as well as its resolution en banc dated
June 1, 1965.

The Free Telephone
Workers Union (hereinafter referred to as the union) was the duly certified
bargaining representative of the rank and file employees of the Philippine Long
Distance Telephone Company – some 1,345 of them at the inception of this case. Sometime prior to October 31,
1964, the expiry date of
the then existing collective bargaining
agreement between them, the union sent demands for a new contract.  One of the demands was for “an increase of salaries by P1.00 per hour per employee
after which a conversion to monthly basis.” The demand was later reduced
to P0.90 per hour, staggered over a period of two years at P0.45 every
year.  The PLDT in turn counter-offered
an increase of P0.30 per hour, staggered over a period of three years at P0.10 every year.

When the negotiations arrived at an impasse the union filed a
strike notice with the Department of Labor. 
The PLDT then proposed an interim arrangement, namely, an increase of
P0.15 per hour
per employee during the period of November 1 through December 31, 1964,
on condition that the strike notice be withdrawn and that if no agreement was
reached on or before December 31, 1964, the wages would be reverted to the
rates in effect prior to November 1, 1964.

The Union rejected the proposal and when
no agree­ment was reached declared a strike on November 1, 1964. 
Forthwith, on November 3, 1964,
the dispute was certified by the President to the Court of Industrial Relations
as falling under Section 10 of Republic Act 875.  The case was docketed as CIR Case No. 51-IPA.

On November 9, 1964,
the Court of Industrial Relations, through Judge Emiliano
C. Tabigne, rendered a partial decision settling the
demand for wage
increase in this wise:

“A.  The Philippine Long
Distance Telephone Company is hereby ordered to pay each of its rank and file
employees, numbering 1,345 persons, the amount of Sixteen Centavos (P0.16) wage increase per hour
from November 9, 1964, the date of this decision, and to run for a period of
one year thereafter;”

The wage increase for the second and
third years was left pending for subsequent adjudication.

The union moved for reconsideration; and on November 17, 1964 the Court en banc
affirmed the partial decision of Judge Tabigne, with
Judge Amando C. Bugayong concurring in the
result but dissenting on the matter of some fifty or more employees of the PLDT
who “are not receiving the minimum salaries established in the prevailing
pay scale of the company.” “These employees should not be
overlooked,” he said, as he saw “no reason why they should not enjoy at least the minimum pay established in the
company.”

Then on November 26, 1965, while the present appeal was pending,
the Court of Industrial Relations rendered what it captioned “Third
Partial Decision,” giving the rank and file employees a wage increase of P0.16 per
hour per employee for the second year (1965-66) and P0.18 per hour for the third
year (1966-67),
effective on November 9, 1965
and November 9, 1966, respectively.

The first issue raised by the petitioner-appellant in this appeal
has to do with the alleged failure of the court below to consider the evidence
as well as the law regarding the payment of minimum wages to the fifty or more
employees referred to in Judge Bugayong’s concurring
and dissenting opinion.  The reference in
said opinion, it should be noted, is not to the statutory minimum wage but to
the “minimum salaries established in the prevailing pay scale of the company.”
But as correctly pointed out by the respondent-appellee
the issue was not one of those before the respondent court; it is raised
for the first time in this appeal, obviously inspired by the dissent
aforesaid.  No findings of fact thereon have
been made in the decision appealed from, as indeed there was no reason to make
them.  The matter is therefore not
a proper subject for review but should be taken up, if at all, in a separate proceeding
below.

The next issue concerns the conversion of the salaries of the
rank and file employees from hourly to monthly basis.  Again the respondent court en banc
did not rule on this question, and the union did not raise it either in its motion
for reconsideration or in its memorandum in support thereof.  There being no ruling and no findings of fact
on this point in the decision appealed from, this Court is in no position to resolve the issue
intelligently.  The only ground upon
which the union now wants to rest its demand for conversion is the fact
that the respondent company’s
supervisors are paid on the monthly basis. 
The ground relied upon is not sufficient.  The supervisors belong to a different bargaining
unit and are covered by a separate bargaining agreement.  The kind of work they perform, their rates of
pay and conditions of employment, as well as other factors may not necessarily
be the same as those which obtain in the case of rank and file employees.  It would be best therefore to leave this
question to be properly ventilated in and decided by the trial court.

The last issue to be considered is whether the order of the Court
of Industrial Relations granting a wage increase of P0.16 per hour per
employee, effective for a period of one year, is supported by substantial
evidence.

The meaning of substantial evidence is long settled in this
jurisdiction.  It does not refer only to
the quantum of the facts presented to support a conclusion but also, and more
importantly, to the quality of those facts. 
Substantial evidence means such relevant evidence as a reasonable mind
might accept as adequate to support a conclusion.^[1]
A reading of the resolution of the Court of Industrial Relations en banc,
affirming the decision penned by Judge Tabigne, shows
that it easily meets the test of substantial evidence, having taken per­tinent
factors into consideration.  Thus the
said resolution states:

“On the question of the wage increase of P0.16 we believe that
the Trial Court is justified in arriving at the increase therein awarded.  The findings of fact made by the Trial Court,
to our mind, sufficiently justifies the award granted.  The award of P0.16 is higher by P0.06 than
the offer of P0.10 made by the respondent firm for the first year.  This award is twice as much as the original P0.08
per hour increase at the beginning of 1961-1964 collective bargaining contract
then existing between the parties.  It
appears that the Trial Court based the said award on several factors.  One of them is the increase of costs of
living in the Manila Area.  According to
Exhibit “1”, the consumers’ price index of all items in the Manila
Area for 1961 was 113.2; 1962, 119.8; 1963, 126.5; and 1964, 133.3 (See Exh. “P”). 
The wage rate of ordinary wage of a skilled laborer in the Manila Area
for the same period are as follows: for 1961, 104.8; 1962, 106.1; 1963, 109.3;
and 1964, 110.9 (See Exh. “1”).  It is further indicated that the PLDT rank
and file employees received already a rate of 1.04 in 1961; 1.12 in 1962; 1.21 in 1963;
1.21 in 1964.  As the graph shows, the
increase of consumers’ price index in the Manila Area was slow and rose gradually, whereas the
rate of wage increase is fast and abrupt during period covered from 1961 to
March 1964 (See Exh. “1-A”).  The P0.16 per hour increase award by the court is, percentage-wise,
more substantial
than that given to the supervisors
in accordance with the collective bargaining agreement which took effect in
January 1964.  The ratio appears to be
13.4% increase
over the present rates of rank and file employees, while the increase of
supervisors amount to only 7.9% over the average basic rates of said
supervisors immediately before the effectivity of
their increase beginning with the year 1964. 
The award granted by the Trial Court covers only the first year as
indicated in the partial decision of November 9, 1964, and in point of
percentage it is almost double the increase granted the supervisors under the
agreement arrived at in the amicable collective bargaining agreement freely
entered into by the company and the supervisors union free from any compulsory
arbitration.  The increase given in the
award of the Trial Court indicated a substantial increase; and at a faster pace
than the increase of cost of living and the rates of skilled personnel in
Greater Manila Area.  From the graph, it
appears that from 1955 to 1964 the hourly rate of typical hourly rate (sic) of
employees of respondent company increased from 65.8%, while the cost of living
of the average household in Manila and suburbs increased by only 33.3%.  Under this situation if we are to include the
P0.16 per hourly increase award by the Trial Court, the increase in the wage
rate of typical rank and file employees of the PLDT is almost three times as
much as the increase of the cost of living in Manila and is almost
nine times as much as in the increase of wage rates of the average skilled
employees in the Greater Manila Area.

Another factor is the prevailing rate of wages for similar nature
of work in the Manila Area.  The rate of
pay of the rank and file employees of the PLDT is one of the highest in the Manila Area
if not the highest, and the increase of P0.16 per hour awarded by the Trial
Court is to our mind more than justified and sufficient under the
situation.  Another factor is the interest of the investor. 
The investor’s profit should be just and reasonable after considering
the trend of business enterprise of the respondent firm.  It is indicated that they are expanding from
year to year by the reinvestment of surplus earnings.  This was necessary in order to meet the exigency
of the service not only in the Manila Area but in all the branches of the
respondent firm for which it was allowed franchise to carry its business.

Let it be known that the Trial Court, before issuing any order on the
subject matter of the conflict between the parties endeavored to conciliate
their differences.  Several formulas were
offered but the parties stood pat on their respective positions without
considering the offer of the court of a solution of the economic differences
that gave rise to the present proceedings. 
Necessarily, the Court has to receive the evidence of the parties and
endeavored to hear them in evidence at the shortest time possible under the
circumstances.  During the hearing, the
parties agreed to the proposition that evidence would be submitted to give the
Court the opportunity to arrive at an award for the first year of the economic
demand on the increase of wages.  And
after weighing the evidence submitted by the parties, the Trial Court arrived at the award now
involved in the present motion for reconsideration.

After hearing the parties
in oral argument and after examining the evidence on record, we feel that the
award of P0.16 by the Trial Court is
supported by the evidence on record and we find no sufficient
justification to alter or modify the same.”

Not to be overlooked in
viewing the union’s demand in a balanced perspective is the fact that on November 26, 1965, after
the instant petition for review was filed, the Court of Industrial Relations rendered a “Third Partial
Decision,” wherein the rank and file employees represented by the union
were granted a wage increase of P0.16 per
hour for the second year, effective November 9, 1965, and another
increase of P0.18 per hour for the third year, effective November 9, 1966.  With the previous increase of P0.16 for the
first year, effective November 9, 1964, the total gained at the start of the
third year as a result of the initial demands which gave rise to this case, was
P0.50 per hour.

Although the third partial decision aforesaid is not the subject
of review herein, we note nevertheless that the lower court has made therein a detailed analysis of the respondent
company’s financial situation and found that in 1964 it made a net return of
6.27% on its investment.  The projection
made by the same court, if a yearly increase of P0.16 per hour was granted for
the next two years, was that the company would realize a net return of 7.55% in
1965, 4.9% in 1966, and 1.84% in 1967. 
In fact, however, the increase actually granted for the third year
effective November 9, 1966, was two centavos per hour more than that which was
made the basis of the projection.

These observations, of course, in no way constitute an affirmance of the lower court’s third partial decision,
which is not under review
herein, but are made only to underscore the fact that the increase new
challenged by the union as insufficient is supported by substantial
evidence.  Indeed, it has been pointed out in its brief by the respond­ent
company, without any denial on the part of the petitioner-appellant, that the
latter appears to consider the additional wage increases as reasonable and did
not even move for their reconsideration.

WHEREFORE, the resolution appealed from is affirmed,
without prejudice to any right on the part of the petitioner-appellant to present anew in the Court below a claim for
conversion of the salaries of its
members to a monthly basis.  No
pronouncement as to costs.

Concepcion, C.J., Reyes, J.B.L., Dizon, Zaldivar, Castro,
Fernando, Teehankee, Barredo,
and Villamor,
JJ., concur.

^[1]
Ormoc Sugar Co. Inc. vs. OSCO Workers
Fraternity Labor Union L-15826. January 23, 1961, 1 SCRA 21, 23-24 citing Ang Tibay vs. CIR 69 Phil.
635 Gonzales vs. Victory Labor Union, L-23256, October 31, 1969, 30 SCRA
47, 49, and cases cited.