GOVERNMENT SERVICE INSURANCE SYSTEM, PETITIONER, VS. GSIS SUPERVISORS UNION AND COURT OF INDUSTRIAL RELATIONS, RESPONDENTS.

On review by Certiorari are:  1) the Order of the Court of Industrial
Relations dated April 29, 1970 in IPA Case No. 87 (8) entitled Government
Service Insurance System Supervisor’s Union (GSISSU) vs. Government Service
Insurance System (GSIS) now G.R. No. L-32018, and 2) the Order of the same
Court dated June 10, 1970 in IPA Case No. 87 (9), entitled Government Service
Insurance System Employees Association – PAGE (GSISEA-PAGE) vs. GSIS,
GSISEA-CUGCO, Intervenor, now G.R. No. L-32397.

The antecedent facts are as follows:  On January
1, 1968, petitioner GSIS implemented a new and higher pay scale to
which the salaries of all GSIS employees and officials were adjusted according
to a uniform pattern.  The increase or
adjustment was equivalent to the next higher rate in the new scale not
necessarily the next higher step in that new scale.  For instance, in Pay Class 12, the first step
under the old scale was P12,000.  In the new scale, the first step was P12,600.  Therefore, the
employee receiving P12,000 under the old scale would
receive an adjustment of P600.00.^[1]
However, it was discovered that some employees headed by Manuel Perlada (Pay Classes 7 to 13) received higher salary
readjustment although some of them were merely “acting designees”.  Other employees belonging to the rank and
file (Pay Classes 1-6) supposedly members of GSISEA-CUGCO received the same
adjustments as the aforementioned employees also effective January 1, 1968. 
Members of the GSISSU and the GSISEA-PAGE did not.  This caused a growing agitation among the
rest of the GSIS officials and employees for the grant to them of the same
benefits.

In a letter dated March
19, 1970 addressed to the GSIS General Manager, Mr. V. N. Magadia, as President of GSISSU, requested for a one (1)
rate increase of salary for all employees and officials of the GSIS.  Magadia also
expressed the general sentiment and feelings of discrimination of the employees
due to the bigger adjustments given to some employees who were merely acting
designees in their positions (Exhibit “D”).  Mr. Federico Romero, Personnel Manager of
GSIS, in a Memorandum dated March 19, 1970 addressed to the GSIS General
Manager, also recommended the extension of the same benefits given to certain
employees to all other employees of the System even if it was to entail a
budget of P4 million (Exhibit “A”).

Apparently, no immediate action was taken by the GSIS on the
matter.  Hence, GSISSU and GSISEA-PAGE
filed their Petitions against the GSIS with the Court of Industrial Relations
on March 19, 1970 (IPA Case
No. 87 [8]), and March 20, 1970
(IPA Case No. 87 [9]), respectively. 
Both Petitions alleged that the GSIS, to discourage membership in their
respective Unions, by-passed their members and others in promotion in pay in
the bargaining unit they represented, while the GSIS unduly favored a number of
employees who were members of GSISEA-CUGCO by granting said employees increases
in pay effective January 1, 1968.  Petitioners
also alleged that despite demands made upon the GSIS to grant them a similar
one (1) rate increase in pay effective January
1, 1968, the latter refused to grant said demands, and that as a
consequence, petitioners had to retain counsel on a contingent basis.  (The matter of attorney’s fees claimed by Attys.
Magadia and Uy is the subject
of another appeal in G.R. No. L-32772).  Petitioners then demanded the same increase
effective January 1, 1968.

On April 1, 1970, the GSIS filed identical Oppositions to the
Petitions alleging that pursuant to GSIS Board Resolution No. 1461, approved on
September 3, 1968, all officials and employees of the System covered by the
collective bargaining agreement of March 26, 1968 were given and paid the
salary increases and adjustments effective January 1, 1968 subject to the terms
and conditions provided therein.

Both cases were jointly tried by the Court of Industrial
Relations.

On April 17, 1970,
GSISEA-CUGCO filed a Motion for Intervention in IPA Case No. 87 (9)
(GSISEA-PAGE vs. GSIS), which was allowed by respondent Court.  In its Answer in Intervention filed on April
25, 1970, GSISEA-CUGCO averred that the increases given to some of its members
were part of the collective bargaining agreement signed between the GSIS and
GSISEA-CUGCO; that even before the implementation of said increase, Mr. Evangelo Savellano, acting
President of GSISEA-CUGCO, in a letter dated February 10, 1970 to the General
Manager of GSIS, demanded the implementation of the collective bargaining
agreement for all members of GSISEA-CUGCO (Exhibit “I”); that as the
representative of 2,500 members of GSISEA-CUGCO, intervenor
prayed that should the Court be minded to grant the one (1) rate increase to
petitioners (GSISEA-PAGE), the same be extended also to all its members
(GSISEA-CUGCO), without any deduction of attorney’s fees being claimed by
Attys. Magadia and Uy.

After hearing, the Court of Industrial Relations issued the
challenged Order, dated April 29, 1970, in IPA Case No. 87 (8) (GSISSU vs.
GSIS), the dispositive portion of which reads as
follows:

“WHEREFORE, respondent GSIS is hereby ordered to cease and
desist from discriminating against petitioner, its members and other employees
in the unit of supervisors, and to grant to all of said employees the same
salary readjustment/increase as those already granted to Manuel Perlada and other members of GSISEA-CUGCO provided they
have not reached the maximum step of their respective pay classes.”

The records show that respondent GSIS received a copy of the
above Order on April 30, 1970.  Respondent GSIS filed its Motion for
Reconsideration of the Order of April
29, 1970 on May 5, 1970,
which was opposed by petitioner GSISSU on the ground that said Motion for
Reconsideration was filed out of time. 
On May 8, 1970, the Court of Industrial Relations en banc
denied the Motion for Reconsideration as it was filed beyond the reglementary period provided by section 17-A of the Rules
of the Court of Industrial Relations. 
GSIS filed a Notice of Appeal on May
29, 1970.

In the meantime, hearing in IPA Case No. 87 (9) (GSISEA-PAGE vs.
GSIS) continued in view of the intervention filed by GSISEA-CUGCO.  Other incidents pertaining to attorney’s fees
were also being resolved by the Court of Industrial Relations, subject matter
of other appeals in G.R. No. L-32772 and G.R. No. L-32854.

However, on June 10,
1970, the Court of Industrial Relations issued the Order in IPA
Case No. 87 (9) (GSISEA-PAGE vs. GSIS, GSISEA-CUGCO, Intervenor), the decretal
portion of which reads:

“WHEREFORE, the respondent is hereby ordered to grant all rank
and file employees (Pay Classes 1 to 6) the same salary readjustment/increase
as that already granted to Manuel Perlada and other
members of Intervenor GSISEA-CUGCO provided they have
not yet reached the maximum step of their respective pay classes; and to deduct
from the employees in Pay Classes 1 to 6 who are entitled to salary
readjustment an amount equivalent to 15% of their respective recoveries as and
for attorney’s fees and to deposit the amount to deducted in Court for further
disposition.

“SO ORDERED.”

The GSIS filed a Motion for Reconsideration of the aforestated Order on June 25, 1970, which was denied by the Court of Industrial
Relations en banc in its Resolution dated June 30, 1970. 
Consequently, the GSIS filed its Notice of Appeal on August 14, 1970.

The Petition for Review by Writ of Certiorari
filed by the GSIS in G.R. No. L-32018 (IPA Case No. 87 (8), GSISSU vs.
GSIS) was given due course by this Court on June 18, 1970; while the Petition for Review by Writ of Certiorari
in G.R. No. L-32397 was given due course on September 4, 1970.

In G.R. No. L-32018, respondent GSISSU
filed a Motion to Dismiss Petition for Review on June 22, 1970.  Said
Motion was based primarily on the ground that the Order of the Court of
Industrial Relations dated April 29, 1970 had already become final and executory as the Motion for Reconsideration of the same was
filed beyond the four (4) day period provided in section 17-A of the Rules of
the Court of Industrial Relations. 
GSISSU averred that the Order of April
29, 1970 was received by GSIS on April 30, 1970. 
Therefore, GSIS had up to May 4,
1970 to file its Motion for Reconsideration.  GSIS filed its Motion for Reconsideration on May 5, 1970, or one day beyond the reglementary period. 
In a Resolution of this Court dated June 30, 1970, petitioner GSIS was required to submit its Comment on the Motion to Dismiss.  In the Comment filed on July 16, 1970, Atty. Lorenzo Mosqueda,
Assistant Government Corporate Counsel, alleged that although copy of the Order
of April 29, 1970 was
received by their Office on April 30,
1970, he received the questioned Order only on May 5, 1970. 
He attached to the Comment a Certificate of Appearance issued by the
Clerk of Court of the Court of Industrial Relations attesting that he appeared
at hearings in Baguio City on April 28-29, 1970 and
May 2, 1970.  He also attached a notarized
medical certificate issued by Dr. Orlando Misa of the
GSIS to the effect that he was under medical treatment for second degree burns
on the left leg and ankle on May 4,
1970.  He then prayed that
under the circumstances and in justice and fairness to the GSIS, its Motion for
Reconsideration should be considered as filed within the reglementary
period.  On July 17, 1970, this Court denied the Motion to Dismiss of
respondent GSISSU, which then filed its Answer on August 13, 1970.

Petitioner filed its Brief in G.R. No. L-32018
on October
23, 1970, and in G.R. No. L-32397
on November 11, 1970.  On December
10, 1970, respondent GSISSU and GSISEA-PAGE moved for the
consolidation of the two cases on the ground that they involved identical
issues.  The Motion for Consolidation was
granted on December 14, 1970.  Respondents GSISSU and GSISEA-PAGE filed
their joint Brief on January 11, 1971,
while GSISEA-CUGCO, intervenor, filed its Brief on December 3, 1970.

G.R. No. L-32018

In G.R. No. L-32018, petitioner GSIS
assigns the following errors:

“I

RESPONDENT CIR COMMITTED A GRAVE ABUSE OF DISCRETION TANTAMOUNT TO
LACK OF JURISDICTION WHEN IT ISSUED THE ORDER OF APRIL 29, 1970, ANNEX
“C” OF THE PETITION, AND AFFIRMED BY THE COURT EN BANC ON MAY 8,
1970, ANNEX “E” OF THE PETITION, EVEN IF THE CASE WAS NOT YET
TERMINATED;

“II

RESPONDENT CIR COMMITTED A GRAVE ABUSE OF DISCRETION TANTAMOUNT TO
LACK OF JURISDICTION WHEN IT ISSUED THE ORDER OF APRIL 29, 1970, ANNEX
“C” OF THE PETITION, AND CONFIRMED BY THE COURT EN BANC IN A
RESOLUTION DATED MAY 8, 1970, ANNEX “E” OF THE PETITION, WHEN IT HELD
THAT YOUR PETITIONER IS FINANCIALLY CAPABLE TO MEET THE ONE STEP SALARY
ADJUSTMENT CONSIDERING THAT THERE IS NO EVIDENCE ON RECORD TO JUSTIFY SAID
CONCLUSION OF FACTS; AND

“III

RESPONDENT CIR ERRED IN AWARDING INDISCRIMINATELY ONE STEP SALARY
ADJUSTMENT TO ALL SUPERVISORS IN DISREGARD OF THE MERIT SYSTEM AND AVAILABILITY
OF FUNDS.”

A close scrutiny of this case leads this Court to believe that
there is no necessity to go into the merits of the appeal.  As previously mentioned, respondent GSISSU
filed a Motion to Dismiss Petition on the ground that the Court of Industrial
Relations Order, dated April 29, 1970, had already become final and executory, the GSIS Motion for Reconsideration of the same
having been filed out of time.  Although
said Motion to Dismiss was denied in the Minute Resolution of this Court dated July 17, 1970, said denial did not
delve into the merits of the Motion.  And
while the grounds cited in the Motion to Dismiss are not reiterated in
respondent’s Brief, we are taking cognizance of the same in view of the legal
implications.

Section 17-A of the Rules of the Industrial
Court, in force during the material dates of this
case, provides as follows:

“Sec. 17-A.  Time of Filing Motion for Reconsideration in
Certified Cases – The aggrieved party may file a motion for reconsideration in
6 copies duly verified together with the supporting argument within a period of
four (4) days without extension from receipt of decision or order together with
proof of service of 1 copy thereof on the adverse party.”

In a leading case, it has been held that
the 4-day period within which to file a motion for reconsideration is
jurisdictional and mandatory and failure to comply therewith is fatal.^[2]

As previously mentioned, copy of the Order of April 29, 1970 was received by a
clerk of the Office of the Government Corporate Counsel on April 30, 1970. 
So, petitioner had until May 4,
1970 within which to file the necessary Motion for Reconsideration.  In its Comment to the Motion to Dismiss filed
by respondent GSISSU, Atty. Lorenzo Mosqueda, the
lawyer assigned to the case, stated that May
1, 1970 was a holiday and May
3, 1970 was a Sunday.  From
April 28 to 29 and May 2, 1970, he was at Baguio City
in connection with the hearing of CIR Case Nos. 67-IPA (3 to 9 and 11) (Annex
“A”, Comment).  On May 4, 1970, he was absent due to
second degree burns on his left leg and ankle (Annex “B”,
Comment).  It was only on May 5, 1970 that he learned personally
of the adverse Order against petitioner, on which date he filed the Motion for
Reconsideration.

In our opinion, the reasons advanced by Atty. Lorenzo Mosqueda, Assistant Government Corporate Counsel and
counsel for petitioner, for his admitted failure to file the Motion for
Reconsideration on time are not constitutive of excusable negligence.  Thus, in the case of NWSA vs. MWSA
Supervisors Union, supra, the failure of the lawyer to file the Motion
for Reconsideration on time due to illness of his clerk was not considered
excusable negligence.  This Court held
that considering the matters being handled by the Office of the Corporate
Counsel, which involves public funds, one cannot but demand a more exacting
sense of responsibility from those concerned. 
Adequate measures should have been taken by that office so that Court
processes may be promptly and properly attended to even on non-working days and
even in the absence of the head of office or the attorney assigned to the case.

Besides, it is to be noted that the main errors assigned are identical
to those in G.R. No. L-32397 and our resolution in the latter case will,
therefore, apply just as well.

G.R. No. L-32397

As regards G.R. No. L-32397, the GSIS
interposed the following Assignments of Error:

“I

RESPONDENT CIR COMMITTED A GRAVE ABUSE OF DISCRETION TANTAMOUNT TO
LACK OF JURISDICTION WHEN IT ISSUED THE ORDER OF JUNE 10, 1970 AND CONFIRMED BY
THE COURT EN BANC IN A RESOLUTION DATED JUNE 30, 1970 HOLDING THAT YOUR
PETITIONER IS FINANCIALLY CAPABLE TO MEET THE ONE STEP SALARY ADJUSTMENT OF
RANK AND FILE EMPLOYEES OF THE SYSTEM FROM PAY CLASSES 1 to 6.

“II

RESPONDENT ERRED IN AWARDING INDISCRIMINATELY ONE STEP SALARY
ADJUSTMENT TO ALL RANK AND FILE EMPLOYEES OF THE SYSTEM FROM PAY CLASSES 1 TO 6
IN DISREGARD OF THE MERIT SYSTEM AND AVAILABILITY OF FUNDS.”

We affirm the Orders of respondent Court.

Petitioner’s claim that the Court of Industrial Relations erred
in finding the GSIS financially capable in meeting the economic demand for a
one (1) rate increase in salary to all employees belonging to Pay Classes 1 –
6, for not being supported by evidence, is without merit.

Respondent Court’s conclusion was based on a Consolidated
Statement of Financial Condition and Results of Operation of the GSIS as of
June 30, 1969 as testified to by Mr. Julian Gonzalvo,
Assistant General Manager of the System for Accounting since 1962.  Mr. Gonzalvo
translated to the Court the Projected Statement of Income and Expenses of GSIS
for the fiscal year July 1, 1969
to June 30, 1970, which he
prepared, showing the favorable financial position of GSIS.  He also testified on a statement prepared
under his direction indicating the capacity of the System to meet the claim for
salary adjustment in the amount of P4,049,134.00; that
by June 30, 1970, the System was expected to realize a net income of P49,995,000.00
available for dividends, bonuses, contingencies and taxes, and that salary
adjustments may be charged proportionally to the three basic funds of the
system, viz., life insurance fund, retirement fund and property insurance fund.^[3]

Petitioner’s contention that the finding of financial capability
of GSIS to pay the salary increases cannot be based merely on a Statement of
Income and Expenses but should consider such other factors as the impact of
economic policies of the Government, the requirements of the future, the
magnitude of the commitments to pay dividends, the difficulties of collecting
some commercial and industrial loans, and a big overdraft, fails when we
consider that the GSIS had, in fact, already ordered payment of the increases,
besides the fact that no evidence to support such factors were presented in
Court.  Moreover, it has been held that
as long as there is evidence to support a Decision of the Court of Industrial
Relations, such Decision may not be revoked or reversed just because it is not
based on overwhelming or preponderance of evidence.^[4]

In respect of the allegation that respondent Court erred in
awarding indiscriminately a one-step salary adjustment to all rank and file
employees (Pay Classes 1 to 6) and supervisory employees (Pay Classes 7 to 13)
in disregard of the merit system, suffice it to state
that the merit system is not in point. 
What respondent Court sought to correct was the discriminatory effect of
the act of petitioner GSIS in granting salary increases to a few and not to
members of other Unions which had no collective bargaining agreement with
it.  Besides, the only condition imposed
on the payment of increases as set forth in the Memorandum of the GSIS General
Manager dated July 22, 1970,^[5]
was that those who were to be given salary adjustments were the ones “not
receiving the maximum of their respective Pay Classes.”

WHEREFORE, 1) in G.R. No.
L-32018, the petition is dismissed and the Order of the Court of Industrial
Relations of April 29, 1970
in IPA Case No. 87(8) is hereby declared final and executory.  No costs.

2)   In G.R. No. L-32397, we hereby affirm the
Order of the Court of Industrial Relations of June 10, 1970, in IPA Case No. 87(9).  No costs.

SO ORDERED.

Makasiar, Fernandez, Guerrero, and De Castro, JJ., concur.

Teehankee, J., (Chairman), files a separate opinion.

^[1]
Exhibit “A”, p. 5, Original Records.

^[2] NAWASA vs. NWSA Supervisors Union, 58 SCRA 232 (1974).

^[3] pp. 5-7 of Order of June 10, 1970 on pp. 42-44 of Rollo.

^[4]
Manila Metal Caps and Tins Mfg. Co. vs. CIR, 8 SCRA 552 (1963).

^[5] G.R. No. L-32397, Rollo, p. 105.

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