G.R. No. 109383. June 15, 1998
MANILA CENTRAL LINE CORPORATION, PETITIONER, VS. MANILA CENTRAL LINE FREE WORKERS UNION-NATIONAL FEDERATION OF LABOR AND THE NATIONAL LABOR RELATIONS COMMISSION, RESPONDENTS.
MENDOZA, J.:
dated October 10, 1991 of the National Labor Relations Commission in
NLRC NCR Case No. 000977-90, dismissing the appeal of petitioner Manila
Central Line Corporation from the order of Labor Arbiter Donato G.
Quinto, Jr., in NLRC NCR Case No. 02-00813-90, as well as the resolution
dated March 11, 1993 of the NLRC, denying reconsideration.
This case arose out of a collective bargaining deadlock between
petitioner and private respondent Manila Central Line Free Workers
Union-National Federation of Labor. The parties’ collective bargaining
agreement had expired on March 15, 1989. As the parties failed to reach
new agreement, private respondent sought the aid of the National
Conciliation and Mediation Board on October 30, 1989, but the deadlock
remained unresolved.
On February 9, 1990, private respondent filed a “Petition for
Compulsory Arbitration” in the Arbitration Branch for the National
Capital Region of the National Labor Relations Commission. At the
initial hearing before the labor arbiter, the parties declared that
conciliation efforts before the NCMB had terminated and it was their
desire to submit the case for compulsory arbitration. Accordingly, they
were required to submit their position papers and proposals, which they
did, and in which they indicated portions of their respective proposals
to which they agreed, leaving the rest for arbitration.[1]
On September 28, 1990, the labor arbiter rendered a decision
embodying provisions for a new collective bargaining agreement. The
dispositive portion of his decision reads:
WHEREFORE, the petitioner UNION and the respondent COMPANY are
directed to execute and formalize their new five-year collective
bargaining agreement (CBA) retroactive to the date of expiry of the
1986-1989 CBA by adopting the provisions in the aforementioned test
which incorporated therein in the disposition set forth by this
Arbitrator within thirty (30) days from receipt of this DecisionSO ORDERED.[2]
Petitioner appealed, but its appeal was denied by the NLRC in its
questioned resolution of October 10, 1991. On March 11, 1993, the NLRC
denied petitioner’s motion for reconsideration. Hence, this petition
with the following assignment of errors:
a) The NLRC erred in affirming the Labor Arbiter’s decision –
1. increasing the commission rate, the incentive pay, the
salaries and wages of the fixed income employees covered by the CBA.2. granting P500.00 signing bonus to the complainant-appellee; and
3. holding that the effectivity of the renegotiated CBA shall
be retroactive to March 15, 1989, the expiry date of the old CBAb) There are serious errors in the findings of facts of the Labor
Arbiter which were unqualified affirmed by the NLRC and which justify
the review by this Honorable SUPREME COURT.c) The NLRC erred in upholding the jurisdiction of the Labor Arbiter; and
d) The NLRC erred in affirming the finalization of the CBA by the
Labor Arbiter in disregard of the provisions agreed upon by the
parties.
The petition is without merit. We shall deal with these contentions
in the order they are presented, with the exception of the argument
concerning the jurisdiction of the Labor Arbiter (par. (c)), which we
shall treat first since it raises a threshold question.
First. Despite the fact that it agreed with the union to
submit their dispute to the labor arbiter for arbitration, petitioner
questions the jurisdiction of the labor arbiter to render the decision
in question. Petitioner contends that the policy of the law now is to
encourage resort to conciliation and voluntary arbitration as Art 250(e)
of the Labor Code provides.
Indeed, the Labor Code formerly provided that if the parties in
collective bargaining fail to reach an agreement, the Bureau of Labor
Relations should call them to conciliation meetings and, if its efforts
were not successful, certify the dispute to a labor arbiter for
compulsory arbitrarion.[3] But
this was changed by R.A.No. 6715 which took effect on March 21, 1989.
Art 250(e) of the Labor Code now provides that if effects of
conciliation fail, the Board shall “encourage the parties to submit
their case to a voluntary arbitrator.” With specific reference to cases
involving deadlocks in collective bargaining, Art. 262 provides:
Jurisdiction over other labor disputes – The Voluntary Arbitrator
or panel of Voluntary Arbitrators, upon agreement of the parties, shall
also hear and decide all other labor disputes including unfair labor
practices and bargaining deadlocks.
This is what the parties did in this case. After the Board failed to
resolve the bargaining deadlock between parties, the union filed a
petition for compulsory arbitration in the Arbitration Branch of the
NLRC. Petitioner joined the petition and the case was submitted for
decision. Although the union’s petition was for “compulsory
arbitration,” the subsequent agreement of petitioner to submit the
matter for arbitration in effect made the arbitration a voluntary one.
The essence of voluntary arbitration, after all is that it is by
agreement of the parties, rather than compulsion of law, that a matter
is submitted for arbitration.[4]
It does not matter that the person chosen as arbitrator is a labor
arbiter who, under Art 217 of the Labor Code, is charged with the
compulsory arbitration of certain labor cases. There is nothing in the
law that prohibits these labor arbiters from also acting as voluntary arbitrators as long as the parties agree to have him hear and decide their dispute.
Moreover, petitioner must be deemed to be estopped from
questioning the authority of Labor Arbiter Donato G. Quinto, Jr., to act
as voluntary arbitrator and render a decision in this case. Petitioner
agreed together with the union, to refer their dispute for arbitration
to him. It was only after the decision was rendered that petitioner
raised the question of lack of jurisdiction. Even then, petitioner did
so only for the first time in a “supplemental memorandum of appeal” to
the NLRC.[5] As the NLRC, through Commissioner Romeo B. Putong held, it was too late in the day for petitioner to do this.[6]
Indeed, it is inconsistent for petitioner to contend, on the
other hand, that this case should have been resolved through voluntary
arbitration and, on the other, to follow the procedure for compulsory
arbitration and, appealing the decision of the labor arbiter to the NLRC
and subsequently questioning the latter’s decision in Luzon Development Bank v. Luzon Development Bank Employees Association,[7]
this case, considered as a special civil action for certiorari to set
aside the decision of a voluntary arbitrator, should have been referred,
as a matter of policy, to the Court of Appeals. However, it was not
evident in the beginning from a cursory consideration of the pleadings
that what actually took place in the labor agency was a proceeding for
voluntary arbitration. Accordingly, so as not to delay the disposition
of this case, we have thought on balance that this case should be
retained and decided on the merits.
Second. In par. (a) (1) and par. (b) of its assignment
of errors, petitioner questions factual findings of the labor arbiter
and the NLRC. Such findings are generally held to be binding, and even
final, so long as they are substantially supported by evidence in the
record of the case.[8] This is
especially so where, as here, the agency and a subordinate one which
heard the case in the first instance are in full agreement as to the
facts.[9]
The decisions of both the NLRC and the labor arbiter contain an
exhaustive discussion of the issues, belying petitioner’s claim that
they did not fully consider the evidence and appreciate what it claims
are the “dire economic straits” it is in. This is evident from the
following portion of the labor arbiter’s order dated September 28, 1990,
which NLRC adopted:
From the foregoing allegations of the parties and as expound (sic),
discussed and/or argued by them in their respective position paper, the
disagreement, or deadlock, as we say it, focus (sic) and centers on the
so called “economic issues” particularly on the provisions on Salaries
and Wages.Petitioner-Union proposed that the commission for drivers,
conductors and conductresses shall be 10% and 8%, respectively of their
gross collections. In addition, as incentive pay, it proposed that
drivers, conductors and conductresses shall be entitled to incentive pay
as follows: (a) For a quota of P2,600.00, the incentive should be
P40.00; (b) for a quota of P2,875.00, the incentive should be P50.00 and
(c) for a quota of P3,155.00 the incentive pay should be P60.00.Further, petitioner-Union, insofar as the “fixed income employees”
are concerned, they proposed that they should be granted a salary/wage
increase as follows: (a) effective March 15, 1989 – P12.00; (b)
Effective March 15, 1990 – P10.00; and (c) effective March 15, 1991 –
P8.00.Respondent, on the other hand, proposes that the commission for
drivers and conductor/tresses shall be 8.5% and 6.5% of their gross
collection, respectively. And in addition, these drivers and
conductors/tresses shall be entitled to an incentive pay based on the
following quota, to wit: (a) for a quota of P3,276.00, the incentive pay
is P35.00; (b) for a quota of P3,635.00, it is P45.00; and for a quoa
of P3,994.00, it is P55.00. Respondent management has no proposal
insofar as grant of increase/s to fixed income employees’ subject of the
bargaining unit.As noted at present under the old CBA, the commission for drivers
and conductor/tresses is 8% and 6%, respectively. During and in the
negotiation, respondent proposes to raise this rate by .5% thus making
it 8.5 and 6.5 respectively. Respondent in proposing an increase of .5%
justifies the same by saying that such is only what it can afford as it
had been incurring financial losses as shown by Financial Statement it
submitted in evidence. This was rejected by the union which proposes
that the rate of the commission be raised to 10% and 8% respectively,
from 8% and 6%, or an increase by 2% respectively. The union debunked
the claim fo the respondent-company that it had been financially
suffering and had claim (sic) that it had earned profit in all the years
that it had been under operation.A look at the parties’ proposal and counter-proposal shows that the
union was demanding that the rate be increased to 10% and 8% from the
old rate of 8% and 6% or an increase of 2% while that of the company
effectively increase the rate by .5% to make the rate at 8.5% and 6.5%.
From this, it appears that the disagreement lies on how much would the
increase equivalent to at least 25% for the drivers and at least 33% for
the conductor/tresses, while that which proposed (sic) by the company
shows an increase of at least 6% and 8% respectively. The difference
between the parties proposal and counter-proposal is at least 19% and
25%, respectively. With this disagreement in this difference, it is
thought of to be practical and reasonable to meet at the middle of the
difference in the rate by dividing the same into two. Hence, the
increase in the rate should be from the present 8% and 6% to 8.75% and
6.75%. However, in order to make the increase realistic it is opined
that it should be rounded off to the nearest full number that is to 9%
and 7%, respectively.As regards the incentive pay, the following appears:
As can be gleaned from the above respondent raised the quota but
maintained the rate for the incentive pay, while the union lowers (sic)
the quota and raises (sic) the rate for the incentive. To the mind of
this arbitrator, he deems it proper and fair for both parties, to adopt
the quota as proposed by the respondent and the rate for the incentive
pay as proposed by the union. It is believe (sic) that such is fair and
reasonable because as appearing in the parties’ proposal and counter
proposal, it would seem that they are trying to out-wit each other.
Hence, such would be as follows:
P40.00 50.00 60.00 Another issue where the parties are in statements (sic) is the matter
of increase in the salary and wages of the fixed income employees
covered by the CBA. The Union proposes an increase of P12.00, P10.00 and
P8.00 to be spread in the three-year period, while the company did not
submit a proposal for an increase claiming that it cannot afford to give
any increase as it had suffered financial difficulty. However, as
already discussed earlier where it is found that respondent, as shown by
its financial statement, is not really in the verge of financial
collapse, it is believed that it is reasonable and fair to the parties,
particularly to the union that increase would be mandated. However, we
could not adopt in toto the proposal of the union. Instead, we are to
adopt the increase as provided under the old CBA, that is, P6.00 for the
first year, P5.00 for the second year and P4.00 for the third year.[10]
Petitioner contends, however, that the labor arbiter has a duty to
indicate in his order every relevant proof necessary to show that the
opposing party’s evidence is superior to that of petitioner. This is not
so. The quantum of proof required in proceedings before administrative
agencies is “substantial evidence,” not overwhelming or preponderant
evidence.[11] The quoted
portion of the labor arbiter’s order shows that the proposals of the
parties as well as petitioner’s financial statements were carefully
considered by him in arriving at his judgment. As the Solicitor General
states:
Nor did respondent NLRC overlook the protestations of the COMPANY
that it is suffering from “gargantuan economic trouble.” This assertion,
however, was sufficiently refuted by the UNION by presenting proof that
the COMPANY had acquired a bus terminal area in Tunasan. Moreover, the
COMPANY had just imported machines to recondition their old buses. Also,
as can be seen in the 1992 Financial Statement of the COMPANY had just
imported machines to recondition their old buses. Also, as can be seen
in the1992 Financial Statement of the COMPANY, it acquired new buses
worth P2,400,000.00. These facts verify the findings of the Labor
Arbiter that the COMPANY is not on the verge of financial
collapse….Also, the COMPANY had offered an increase of .5% but in the
same breath, it claims that it can hardly maintain the commission rate
of 8% and 6%. There is a contradiction of facts right there and then,
which considerably weakens its assertionsThe increase in commission rate will not really affect the income
of the COMPANY. By their very nature, commissions will only be given to
the employees if the COMPANY receives more income. They are given in the
form of incentives or encouragement so that employees would be inspired
to put a little more industry on their particular tasks. This is unlike
salaries and wages which are fixed amounts and which should be given to
the employees regardless of whether the COMPANY is making any
collection or not. Therefore, the employees are merely asking a
percentage of the earnings of the COMPANY, which they, through their
efforts, helped produce.As regards the incentive pay increase, the COMPANY’s financial
position was also taken into consideration. It appears that the COMPANY
and the UNION were trying to outwit each other in their respective
proposals. Thus, the position adopted by the Labor Arbiter – –
increasing the quota and the amount of incentive – is a middle ground
which is fair to both parties.The increase in salaries and wages was premised on the findings of
the Labor Arbiter that the COMPANY was not on the verge of financial
collapse and that an increase would be mandated, particularly taking
into consideration the inflation or increase in the cost of living in
the subsequent years after the CBA was finalized. In adopting the wage
increase rates provided in the old CBA, the financial condition of the
COMPANY as well as the needs of the employees were taken into
consideration. When conclusions of the Labor Arbiter are sufficiently
corroborated by the evidence on record, the same should be respected by
the appellate tribunals since he is in a better position to assess or
evaluate the credibility of the contending parties [CDCP Tollways
Operation Employees and Workers Union v. NLRC, 211 SCRA 58)….[12]
Nor is the grant of a P500.00 “signing bonus” to employees
unreasonable or arbitrary. The amount is a modest sum, to be given by
petitioner only once, in order to make employees finally agree to the
new CBA. In ordering payment of this amount, the labor arbiter acted in
accordance with Art. 262-A of the Labor Code which provides in part:
Procedures. – The voluntary Arbitrator or panel of Voluntary Arbitrators shall have the power to hold hearings, receive evidence and take whatever action is necessary to resolve the issue or issues subject to dispute, including efforts to effect a voluntary settlement between parties. (emphasis added)
Third. Petitioner also contends that in ordering a new CBA
to be effective on March 15, 1989, the expiry date of the old CBA, the
labor arbiter acted contrary to Art. 253-A of the Labor Code. This
provision states, among others, that:
Any agreement on such other provision of the Collective Bargaining
Agreement entered into within six (6) months from the date of the expiry
of the term of such other provisions as fixed in such Collective
Bargaining Agreement, shall retroact to the day immediately following
such date. If any such agreement is entered into beyond six months, the
parties shall agree on the duration of retroactivity thereof. In case of
a deadlock in the renegotiation of the collective bargaining agreement,
the parties may exercise their rights under this Code.
Art. 253-A refers to collective bargaining agreements entered into by
the parties as a result of their mutual agreement. The CBA in this
case, on the other hand, is part of an arbitral award. As such, it may
be made retroactive to the date of expiration of the previous agreement.
As held in St. Luke’s Medical Center, Inc. v. Torres:
Finally, the effectivity of the Order of January 28, 1991, must
retroact to the date of the expiration of the previous CBA, contrary to
the position of petitioner. Under the circumstances of the case, Article
253-A cannot be properly applied to herein case. As correctly stated by
public respondent in his assailed Order of April 12, 1991 dismissing
petitioner’s Motion for Reconsideration –Anent the alleged lack of basis for the retroactivity to
provisions awarded, we would stress that the provision of law invoked by
the Hospital. Article 253-A of the Labor Code, speaks of agreements by
and between the parties, and not arbitral awards . . . (p. 818 Rollo).Therefore, in the absence of a specific provision of law
prohibiting retroactivity of the effectivity of arbitral awards issued
by the Secretary of Labor pursuant to Article 263(g) of the Labor Code,
such as herein involved, public respondent is deemed vested with plenary
and discretionary powers to determine the effectivity thereof.[13]
Indeed, petitioner has not shown that the question of effectivity was
not included in the general agreement of the parties to submit their
dispute for arbitration. To the contrary, as to the order of the labor
arbiter states, this question was among those submitted for arbitration
by the parties:
As regards the “Effectivity and Duration” clause, the company
proposes that the collective bargaining agreement shall take effect only
upon its signing and shall remain in full force and effect for a period
of five years. The union proposes that the agreement shall take effect
retroactive to March 15, 1989, the expiration date of the old CBA.And after an evaluation of the parties’ respective contention and
argument thereof, it is believed that the union is fair and reasonable.
It is the observation of this Arbitrator that in almost subsequent CBAs,
the effectivity of the renegotiated CBA, usually and most often is made
effective retroactive to the date when the immediately proceeding CBA
expires so as to give a semblance of continuity. Hence, for this
particular case, it is believed that there is nothing wrong adopting the
stand of the union, that is that this CBA be made retroactive effective
March 15, 1989.[14]
Fourth. It is finally contended that the labor arbiter
disregarded many provisions of the old CBA which the parties had
“retained, improved and agreed upon,” with the result that “the CBA
finalized by the Honorable Labor Arbiter does not reflect the true
intention of the parties.”[15]
Petitioner does not specify, however, what provisions of the old CBA
were disregarded by the labor arbiter. Consequently, this allegation
should simply be dismissed.
WHEREFORE, the petition is DISMISSED for lack of merit.
SO ORDERED.
Regalado, (Chairman), Puno, and Martinez, JJ., concur.
Melo, J., on leave.
[1] Rollo, pp. 29-31.
[2] Id., p. 28.
[3] Pres. Decree No. 1691, §3 (1980) and Pres. Decree No. 442, Art 297 as originally numbered (1974)
[4] See Luzaon
Development Bank v. Luzon Development Bank Employees Ass’n, 249 SCRA 162
(1995); 2 C.A. AZUCENA, THE LABOR CODE 353 (1996).
[5] Rollo, p. 39
[6] Id., pp. 39-40; M.
Ramirez Industries v. Secretary of Labor, G.R. No.89894, Jan. 3, 1997;
Stalt-Nielsen Marine Services (Phils.) Inc. v. NLRC, 264 SCRA 307
(1996).
[7] 249 SCRA 162 (1995)
[8] International Container Terminal Services, Inc., v. NLRC, 256 SCRA 124 (1996).
[9] Belaunzaran v. NLRC, 265 SCRA 800 (1996).
[10] Rollo, pp. 34-36.
[11] Ynson v. Court of Appeals, 257 SCRA 411 (1996); RULES OF COURT, Rule 133, §5.
[12] Rollo, pp. 95-98.
[13] 223 SCRA 779-793 (1993); reiterated in Philippine Airlines, Inc. v. Confessor 231 SCRA 41 (1994).
[14] Rollo, pp. 38-39.
[15] Id., p. 22.