PHILIPPINE ASSOCIATION OF FREE LABOR UNIONS (PAFLU), PETITIONER, VS. HON. JOAQUIN M. SALVADOR AND SOCIAL SECURITY SYSTEM, RESPONDENTS.

Philippine Association of Free Labor Unions versus Salvador

The Case

This is the Philippine Association of Free Labor Unions, a labor union, against the Honorable Joaquin M. Salvador, in his capacity as a judge of the Court of Industrial Relations, and the Social Security System. The union filed petitions for certiorari and prohibition, later followed by motions for reconsideration, assailing the jurisdiction of the Court of Industrial Relations to act on an urgent petition of the Social Security System seeking an authoritative interpretation of a provision of a collective bargaining agreement that had been adopted as a formal award of that court. The case matters because it fixes the boundary between genuine collective bargaining and compulsory arbitration, and because it teaches that the jurisdiction of the industrial court over an award continues during the effectivity of that award, even without a fresh presidential certification.

Procedural History

The controversy began in the Court of Industrial Relations, where the union and the Social Security System had earlier submitted a collective bargaining agreement that the court approved and adopted as its formal award. In 1968 the Social Security System filed an urgent petition asking that court to interpret a provision of that award. The union challenged the court's jurisdiction, insisting that without a new presidential certification the court could not act. The Court of Industrial Relations, through Judge Salvador, upheld its own competence. The union then went to the Supreme Court by petitions for certiorari and prohibition. On September 28, 1968, the Supreme Court dismissed the petitions and sustained the jurisdiction of the respondent judge. The union moved for reconsideration on October 3, 1968, and later filed an urgent amended motion for reconsideration on October 14, 1968. The present decision resolves those motions.

Facts

In 1963 the Court of Industrial Relations acquired jurisdiction over a labor dispute between the union and the Social Security System. Before any collective bargaining agreement was formulated, the court had already rendered a decision or made an award laying down the terms and conditions governing the relations of the parties. While that award was on appeal, the parties agreed to abandon the appeal and instead submitted to the court a so-called collective bargaining agreement, which in substance reproduced the award already made, except for inconsequential differences.

The parties did not merely inform the court of an amicable settlement and ask for dismissal. They asked the court to approve the agreement and make it its award. On August 5, 1966, the Court of Industrial Relations issued an order approving and adopting the collective bargaining agreement as its formal and final award. The award was effective from July 1, 1966 to June 30, 1969, a period of three years.

In 1968 the Social Security System filed an urgent petition seeking an authoritative interpretation of a provision of that award. The union objected, arguing that there was no new presidential certification and that the court's jurisdiction had ended. Notably, the union itself had earlier invoked the very same award, filing a motion for execution on February 2, 1967, and later motions, all describing the agreement as the formal and final award of the court.

Issues

• Whether or not the Court of Industrial Relations may act on a petition to interpret a provision of a collective bargaining agreement adopted as its formal award, absent a new presidential certification.
• Whether or not the jurisdiction originally acquired by the Court of Industrial Relations in 1963 extends to a labor dispute arising in 1968 under that award.
• Whether or not treating the collective bargaining agreement as an award violates the policies of the Industrial Peace Act favoring voluntary collective bargaining.

Applicable Provisions

Section 17 of Commonwealth Act Number 103, the Court of Industrial Relations Act, as invoked by the parties, provides:

At any time during the effectiveness of any award, order or decision, the Court may, on application of an interested party, and after due hearing, alter, modify in whole or in part, or set aside any such award, order or decision, or reopen any question connected with the labor dispute.

This provision supplies the continuing power of the court over its own award during the three-year period of effectivity.

Section 18 of the same Act provides:

The Court may determine the meaning or interpretation of any award, order or decision issued by it.

This is the authority relied upon by the Social Security System when it asked the court to interpret a single provision of the award.

Ruling

On the first issue, the Court held that the absence of a new presidential certification is not fatal, because a previous certification had resulted in the award of August 5, 1966, whose effectivity continued. The Court described the power to interpret, modify, or set aside an award as comprehensive in character, and said it has never been construed in a niggardly sense. It quoted its own conclusion:

It suffices to declare that there being a previous presidential certification resulting in an award, the effectivity of which continues up to the present, respondent Judge could appropriately rely on the two above sections for the purpose of considering the merit or lack of it of the urgent petition filed by respondent Social Security System.

On the second issue, the Court held that the jurisdiction acquired in 1963 continued because the award remained effective until June 30, 1969, and the power to interpret and modify operates during that effectivity.

On the third issue, the Court acknowledged that the union's theoretical arguments were persuasive, but found them bereft of support in the controlling facts. The agreement was not the product of real and free bargaining; it was the award already made by the court, which the parties asked the court to approve and adopt as its award. The union itself had first invoked that award as such. As the Court put it, if the agreement is being treated as an award, it is only because the parties wanted it that way.

Doctrine

A collective bargaining agreement that the parties submit to the Court of Industrial Relations for approval and adoption becomes a formal award of that court, and the court retains comprehensive jurisdiction over it during its effectivity. That jurisdiction includes the power to alter, modify, or set aside the award under Section 17, and to determine its meaning or interpretation under Section 18 of Commonwealth Act Number 103. A prior presidential certification that produced a still-effective award suffices; no new certification is required. The Court will not allow a party who invoked an agreement as an award to later deny that character when it becomes inconvenient.

Disposition

The motions for reconsideration were denied, and the earlier dismissal of the petitions was maintained, leaving the jurisdiction of the respondent judge undisturbed.

Remember This

Memorize this line: a collective bargaining agreement adopted by the Court of Industrial Relations as its award carries the court's continuing jurisdiction during its effectivity, even without a new presidential certification. Examiners use this case to test the distinction between voluntary collective bargaining and compulsory arbitration, and the scope of the industrial court's power to interpret and modify its own awards.