LIBERTY COTTON MILLS WORKERS UNION, RAFAEL NEPOMUCENO, MARCIANO CASTILLO, NELLY ACEVEDO, RIZALINO CASTILLO, AND RAFAEL COMBALICER, PETITIONERS, VS. LIBERTY COTTON MILLS, INC., P…

A motion was filed on September 24, 1975 by herein petitioners
Liberty Cotton Mills Workers Union, Rafael Nepomuceno,
Mariano Castillo, Nelly Acevedo, Rizalino Castillo,
and Rafael Combalicer, for the reconsideration and/or
modification of the decision dated September 4, 1975.

The Court, in its resolution dated September 29, 1975, required the respondents to comment on
said motion.  Respondent Liberty Cotton
Mills, Inc. filed its comment on October
27, 1975.  However,
respondent Philippine Association of Free Labor Union (PAFLU)
filed on October 30, 1975
a manifestation of compliance submitting petitioner’s motion for
reconsideration without comment. 
Respondent National Labor Relations Commission, successor of the defunct
Court of Industrial Relations, filed its comment on November 5, 1975.

In their motion, petitioners pray that:

1.     
the respondent company be made jointly and
severally, or at least jointly, liable for the payment of backwages
of the workers involved;

2.     
the workers involved be reinstated immediately,
without loss of seniority and/or fringe benefits and, upon their reinstatement,
their wages should be at the same rates as those of their contemporaries in
1964; and

3.     
the backwages
of the workers involved be made for more than three (3) years without any
deduction or qualification or at least 50% backwages
or 5½ years, also without deduction or qualification, if not from the date of
dismissal up to the date of actual reinstate­ment (pp. 4-5, Motion for
Reconsideration, pp. 230-231, rec.).

The Court’s decision, among others, limited the liability of the
respondent company to the immediate reinstatement of the workers (petitioners
herein) and directed respondent PAFLU to pay the
petitioner workers the equivalent of three (3) years backwages
without deduction or qualification.

It is OUR considered view that respondent company is equally
liable for the payment of backwages for having acted
in bad faith in effecting the dismissal of the individual petitioners.  Bad faith on the part of the respondent
company may be gleaned from the fact that the petitioner workers were dismissed
hastily and summarily.  At best, it was
guilty of a tortious act, for which it must assume solidary liability, since it apparently chose to summarily
dismiss the workers at the union’s instance secure in the union’s contractual
undertaking that the union would hold it “free from any liability”
arising from such dismissal.

It appears that on May
17, 1964, thirty-two (32) out of the thirty-six (36) members of the
local union, Liberty Cotton Mills Union, disaffiliated themselves from
respondent PAFLU in accordance with Article X, on
Union Affiliation, of the local union’s Constitution and By-Laws, which
provides that:

“Section 1.  The Liberty Cotton Mills Workers Union-Paflu x x x
shall remain an affiliate as long as ten or more of its members evidence their
desire to continue the said local union’s affiliation x x
x.”

Respondent PAFLU received the
resolution of disaffiliation on May
25, 1964 and immediately informed the respondent company on May 27, 1964 that the dis­affiliation
was null and void and that it is taking over the administration of the local
union in dealing with the management. 
Two days later, on May 29, 1964, PAFLU advised
the company that the petitioner workers, who were among those who signed the
disaffiliation resolution, were expelled from their union membership in the
mother federation because they were found guilty of acts unbecoming of officers
and members of the union and disloyalty to the mother federation for
instigating union disaffiliation, and at the same time requested for their
dismissal.  On May 30, 1964, the company terminated the
employment of the petitioner workers pursuant to the Maintenance of Membership
provision of the Collective Bargaining Agreement, the pertinent portion of
which reads, as follows:

“x x x for disloyalty to the union shall be dismissed from
employment by the Company upon request in writing by the Union, which shall
hold the COMPANY free from any liability arising from or caused by such
dismissal.”

While respondent company, under the Maintenance of Membership
provision of the Collective Bargaining Agreement, is bound to dismiss any
employee expelled by PAFLU for disloyalty, upon its
written request, this undertaking should not be done hastily and
summarily.  The company acted in bad
faith in dismissing petitioner workers without giving them the benefit of a
hearing.  It did not even bother to
inquire from the workers concerned and from PAFLU
itself about the cause of the expulsion of the petitioner workers.  Instead, the company immediately dismissed
the workers on May 30, 1964 after its receipt of the request of PAFLU on May 29, 1964 – in a span of only one day – stating
that it had no alternative but to comply with its obligation under the Security
Agreement in the Collective Bargaining Agreement, thereby disregarding the
right of the workers to due process, self-organization and security of tenure.

Morever, even after the workers were
dismissed on May 30, 1964,
and had sought for a reconsideration of their dismissal the next day,
respondent company stood pat on its decision and immediately denied the request
for reconsideration on June 2, 1964
without any valid reason.  This actuation
further emphasizes respondent company’s bad faith in the dismissal of the
petitioner workers.

The power to dismiss is a normal prerogative of the employer.  However, this is not without
limitations.  The employer is bound to
exercise caution in terminating the services of his employees especially so
when it is made upon the request of a labor union pursuant to the Collective
Bargaining Agreement, as in the instant case. 
Dismissals must not be arbitrary and capricious.  Due process must be observed in dismissing an
employee because it affects not only his position but also his means of
livelihood.  Employers should therefore
respect and protect the rights of their employees, which include the right to
labor.  For as WE have already stated:

“The right to labor is a constitutional as well as a statutory
right.  Every man has a natural right to
the fruits of his own industry.  A man
who has been employed to undertake certain labor and has put into it his time
and effort is entitled to be protected.  The
right of a person to his labor is deemed to be properly within the meaning of
constitutional guarantees.  That
is his means of livelihood.  He
cannot be deprived of his labor or work without due process of law” (Batangas Laguna Tayabas Bus
Company vs. Court of Appeals, 71 SCRA 470, 480 [1976];
Phil. Education Co., Inc. vs. CIR, et al., L-7156, May 31, 1955; Philippine
Movie Pictures Workers’ Association vs. Premier Productions, Inc., 92 Phil.
843, 848 [1953]; 11 Am Jur., 333, pp. 1151-1153;.11
Am Jur., section 344, pp. 1168-1171; underscoring
supplied).

The “scandalous haste” with which the company dismissed
the workers, acceding with unusual alacrity to the request of PAFLU, and without giving them the benefit of a hearing
prior to their dismissal, also supports the conclusion that there was
conspiracy or connivance between the respondent company and respondent PAFLU in the dismissal of the petitioner workers.

Likewise, the records show that the disaffiliation of the local
union members from the PAFLU was caused by the
alleged negligence of PAFLU and its lack of concern
over the problems of the local union and its members, particularly its neglect
in not providing the local union with a good lawyer who would attend to their ULP case against the company.  This apparent laxity or negligence of PAFLU invites suspicion.

The records also show that the local union members were
dissatisfied with the way PAFLU negotiated the
Collective Bargaining Agreement with the company because it did not fight for
their demands and instead accepted the proposals of the company.  

And furthermore, PAFLU expelled only
six (6) union members, because PAFLU erroneously
contends that their disaffiliation and their refusal to retract amounted to
disloyalty.  It was not disloyalty; it
was their dissatisfaction with PAFLU that compelled
them to disaffiliate.  The constitutional
guarantee of security of tenure of the worker and his freedom of association –
to join or not to join a union – are paramount and should prevail over a
contractual condition for continued union membership and over whimsical or
arbitrary termination of his employment.

Respondent PAFLU also overlooked the
fact that only sixteen (16) out of the original thirty-two (32) signatories
retracted their disaffiliation.  PAFLU should have also expelled the remaining sixteen
members who did not retract, instead of only the six members, if indeed their unretracted disaffiliation were an act of disloyalty
instead of dissatisfaction with the PAFLU’s failure
to promote and defend their interests.

It is also worth considering here the fact that of the six
members expelled by PAFLU and subsequently dismissed
by the company, four (4) were officers of the local union and two were ordinary
members.

The company also failed to notice this fact and proceeded
immediately to grant the request of PAFLU by
dismissing the petitioner workers without giving them the opportunity to be
heard.

These facts and circumstances on record further underscore the
existence of conspiracy or connivance between the company and PAFLU in the dismissal of the petitioner workers.  Respondent company is therefore a party to
the illegal dismissal of the petitioner workers.  Under such a situation, the respondent
company should be jointly and severally liable with the respondent PAFLU for the payment of backwages
to the petitioner workers.

The other reliefs prayed for by the
petitioner workers do not merit any consideration for the reason that the
amount of backwages fixed by the Court in the main
decision, consisting of three (3) years backwages
without deduction or qualification, following the formula of computing backwages enunciated in the case of Mercury Drug Co., Inc.,
et al. vs. CIR, et al.  (56 SCRA 694 [1974], is just and reasonable under the facts and
circumstances obtaining in the case. 
This new formula of fixing the amount of backwages
to a just and reasonable level without deduction or qualification has been
reiterated in a number of cases, the more recent of which is the case of L. R. Aguinaldo Co., Inc., et al. vs. CIR, et al. (82 SCRA 309 [1978]) where the Court ordered the reinstatement
of the illegally dismissed employees and awarded three (3) years backwages without deduction or qualification considering
the lapse of time from the date of their dismissal (see also Danao Development Corporation vs. NLRC,
et al. (81 SCRA 489 [1978]; Monteverde,
et al. vs. CIR, et al. (79 SCRA 259 [1977]; Insular
Life Insurance Co., Ltd. Employees Association-NATU
vs. Insular Life Assurance Co., Ltd. (76 SCRA 50 [1977];
People’s Bank and Trust Company, et al. vs. People’s Bank and Trust Company
Employees Union, et al. (69 SCRA 10 [1976]; and cases
cited therein).

And the rationale for the formula was explained by this Court in
the case of Feati University Faculty Club vs. Feati University
(58 SCRA 395 [1974]) as follows:

“x x x this
formula of awarding reasonable net backwages without
deduction or qualification relieves the employees from proving or disproving
their earnings during their lay-off and the employers from submitting
counterproofs; and obviates the twin evils of idleness on the part of the
employee who would ‘with folded arms, remain inactive in the expectation that a
windfall would come to him’ and attrition and protracted delay in satisfying
such award on the part of unscrupulous employers who have seized upon the
further proceedings to determine the actual earnings of the wrongfully
dismissed or laid-off employees to hold unduly extended hearings for each and
every employee awarded backwages and thereby render
practically nugatory such award and compel the employees to agree to
unconscionable settlements of their backwages award
in order to satisfy their dire need.”

WHEREFORE, the decision dated September 4, 1975 is hereby amended to read as follows:

“WHEREFORE, the decision appealed from is reversed and set
aside and the RESPONDENT company is hereby ordered to immediately reinstate
complainant workers, AT CURRENT RATES PAID BY IT TO WORKERS OCCUPYING THE SAME
OR SIMILAR POSITIONS, WITHOUT LOSS OF SENIORITY AND OTHER PRIVILEGES AS IF SAID
COMPLAINANT WORKERS HAD NOT BEEN WRONGFULLY DISMISSED, within thirty (30) days
from notice of this decision and failure to so reinstate the workers without
valid and just cause shall make respondent company liable to the workers for
the payment of their wages AT CURRENT RATES from and after the expiration of
such thirty-day period.  The mother
federation PAFLU AND RESPONDENT LIBERTY COTTON MILLS,
INC. ARE hereby sentenced to pay JOINTLY AND SEVERALLY complainants-workers the
equivalent of three (3) years backwages (AT THE RATES
ACTUALLY RECEIVED BY THEM BEFORE THEIR DISMISSAL) without deduction or qualification,
AND RESPONDENT PAFLU IS IN TURN SENTENCED TO
REIMBURSE AND PAY RESPONDENT LIBERTY COTTON MILLS, INC. ANY AND ALL SUCH
AMOUNTS THAT SAID RESPONDENT COMPANY MAY PAY HEREUNDER BY WAY OF BACKWAGES TO THE COMPLAINANTS-WORKERS.

“In view of the length of time that this dispute has been
pending, this decision shall be immediately executory
upon promulgation and notice to the parties. 
Without pronouncement as to costs.”

Teehankee, (Chairman), Fernandez,
Guerrero, and De Castro, JJ., concur.

Melencio-Herrera, J., reserves her vote.