G.R. No. 13072. March 30, 1960
HACIENDA LUISITA, PETITIONER, VS. NATIONAL LABOR UNION AND COURT OF INDUSTRIAL RELATIONS, RESPONDENTS.
LABRADOR, J.:
of the Court of Industrial Relations dated October 19, 1957, rendered
in the case of National Labor Union vs. Hacienda Luisita, No.
835-V, declaring that the compromise agreement embodied in its order
dated February 11, 1954, may be terminated by the respondent only on
June 14, 1959.
The record discloses that prior to February 10, 1954, the National
Labor Union instituted a proceeding against the Hacienda Luisita before
the Court of Industrial Relations (Case No. 835-V), making various
demands regarding the conditions of employment of its members. On
February 10, 1954, said Union and the Hacienda Luisita entered into a
compromise, most of the provisions of which dealt with the nature of
the work to be assigned to employees designated as tractoristas and farmalistas, the pay they should receive for work to which they would be assigned. Paragraph 3 of the Agreement reads as follows:
“3. The HACIENDA agrees to maintain its present
six-day work week schedule for the tractoristas and farmalistas,
provided, however that if there is no available work connected with the
operation and maintenance of the tractors, the HACIENDA shall have the
right to assign any of the tractoristas and/or farmalistas to perform
any other work except cutting grass, cleanings latrines, mixing
fertilizers and manual digging of ditches and canals.”
The compromise having been submitted to the court, the same was
approved on February 11, 1954,, the court declaring “Consequently, this
agreement constitutes the decision of the Court in the above entitled,
case; and, for purposes of industrial peace, the parties are hereby
enjoined to comply strictly to the terms and conditions of this
agreement, etc.” The above compromise agreement was adopted pending
certification by the Court of Industrial Relations of the Union which
shall be the exclusive bargaining agent of the laborers and employees
of the Hacienda Luisita. Thereafter the National Labor Union was
declared as the bargaining unit, and on December 18, 1956, entered into
another agreement, Annex “C”. In this agreement the following provision
was inserted:
“SEC. 9. Tractoristas and Farmalistas.—In
view of the misunderstanding between the union and the hacienda as to
whether or not the hacienda has the legal right to terminate on
February 11, 1957 the award granted on February 11, 1954 by the Court
of Industrial Relations in CIR Case No. 835-V, the parties hereto have
agreed as follows:“(a) All of the tractoristas and
farmalistas covered by the aforementioned order of the Court, of
Industrial Relations shall be allowed to retire under the same terms
and “Conditions as the personnel of the Taller and Almacen Departments
have been retired. In connection with the foregoing, 26 out of the 87
tractoristas and farmalistas had in fact already retired and been paid
their respective retirement pay.“(b) If the eleven remaining
tractoristas and farmalistas do not choose to retire, the HACIENDA
shall, pursuant to what it believes to be its right under Section 17 of
Commonwealth Act No. 103, terminate on February 11, 1957 the
effectiveness of the award or decision granted to the said tractoristas
and farmalistas under the aforementioned CIR order dated February 11,
1954, and shall thereafter convert the said eleven remaining
tractoristas and farmalistas into regular milling season workers.
However, inasmuch as the union does not agree with the HACIENDA’S
belief that the latter can terminate the said award of the Court of
Industrial Relations, the union hereby reserves its rights to question
the HACIENDA’S right to terminate the above-mentioned court award by
instituting the necessary legal proceedings before the Court of
Industrial Relations, and the parties hereto agree to abide by the
final decision of the courts in this regard. If no final decision is
rendered before February 11, 1957, the HACIENDA shall continue with its
contemplated action, but it is clearly understood and agreed that if
the court’s final decision shall sustain the union’s position, all the
rights and benefits that the tractoristas and farmalistas may be
deprived of as a result of the HACIENDA’S contemplated action shall be
restored to them; on the other hand, if the court shall finally decide
that the HACIENDA has the right to terminate the effectiveness of the
aforementioned award of the Court of Industrial Relations, the union
shall accept as final the HACIENDA’S contemplated action in this regard.“(c)
Notwithstanding the result of the legal action that may be instituted
by the union as set forth in paragraph (b) hereof, the parties hereto
agree that the award granted in the aforementioned order of the Court
of Industrial Relations dated February 11, 1954 shall not be applicable
to any tractorista and/or farmalista who may be hired by the HACIENDA,
or to any other employee or worker of the HACIENDA who may be assigned
to perform the functions of tractoristas or farmalistas after the
effectivity of this agreement.”
As shown in the above-quoted provision, there was a misunderstanding
between the respondent union and the HACIENDA as to the right of the
latter to convert the tractoristas and the farmalistas into regular
season milling workers, the HACIENDA claiming that by virtue of the
compromise agreement approved by the court on February tractoristas and farmalistas
into regular milling season workers from the third year after the first
decision of the court on February 11, 1954, and the National Labor
Union contending that the right to make the change could only be
recognized in the HACIENDA three years after the second agreement dated
December 18, 1956. In view of this misunderstanding, Rodolfo Garcia, a
member of the respondent union, presented a motion for a clarification
to the Court of Industrial Relations, alleging that he and his
co-movants are of the belief that the HACIENDA could not change or
terminate the award granted in the compromise agreement of February 11,
1954, until after three years after the effectivity of the bargaining
agreement of December 18, 1956. The HACIENDA, contending otherwise,
opposed the petition. In an order dated August 26, 1957, the court
sustained the contention of the Union, citing the case of Katipunan
Labor Union vs. Caltex (Phils.) and CIR, G. R. No. L-10337,
May 27, 1957, to the effect that a contract may not be unilaterally set
aside by a party. A motion to reconsider this order was presented but
the same was denied on October 19, 19S7. Hence this appeal by
certiorari.
The first agreement between the parties is that approved by the
Court on February 11, 1954. The parties are bound by that agreement for
a period of at least three years. The tractoristas and farmalistas,
whose status was recognized as such, are to remain in that status for a
period of three years, as provided for in the contract of February 11,
1954. This contract has the force of law between the parties, in
accordance with Section 17 of Commonwealth Act No. 103, which reads as
follows:
“SEC. 17. Limit of effectiveness of award.—An
award, order or decision of the Court shall he valid and effective
during the time therein specified. In the absence of such
specification, any party or both parties to a controversy may terminate
the effectiveness of an award, order or decision after three years have
elapsed from the date of said award, order or decision by giving notice
to that effect to the Court: Provided, however, That at any
time during the effectiveness of an 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 involved therein.”
The court below did not make a finding that the change is not
justified by the circumstances; the court denied it merely on the
technical ground that an agreement may not be altered without the
consent of both contracting parties. The case of Katipunan Labor Union vs. Caltex (Phils.) and Court of Industrial Relations, supra,
lays down the principle that an award may not be terminated by mere
notice of one party. The ruling is not applicable to the case at bar.
But the law fixing the period of effectivity of labor contracts
provides that the same is to continue for a specified period of three
years (Sec. 17, C. A. No. 103.) As the time for authority to change is
thus expressly fixed by law at three years, it stands to reason that in
the absence of any other agreement to the contrary, and for reasons of
justice and equity; any party to an agreement may change or modify the
same upon the expiration of the period of three years from the date
thereof.
A consideration of the nature and character of, the industry in
which the HACIENDA Luisita is engaged justifies the decision of the
HACIENDA to convert the tractoristas and farmalistas
into regular season milling workers. Work in the planting and
cultivation of sugar cane comes in seasons. When no planting or
cultivation is being done, it would be unreasonable to require the
HACIENDA to employ tractoristas or farmalistas.
Without doing their specific work at all. In the contract and in the
compromise agreement of February 11, 1954, approved by the court, the
HACIENDA Luisita undertook to assign the tractoristas and farmalistas
in other jobs if the tractors are not being used. This is expressly
provided in paragraph 8, as quoted above. But upon the expiration of
the period of three years from the date of the compromise agreement and
the decision of the court on February 11, 1954, the obligation of the
HACIENDA to continue employing them in other jobs terminated, and with
this termination the right of the HACIENDA to change them (tractoristas and farmalistas)
into regular season or milling workers can not be denied, because the
change is justifiable and is impliedly recognized in the Agreement of
December 18, 1956. The right of the HACIENDA to convert these workers
into regular milling season workers is clearly and expressly granted in
Section 2 of Article I of the Collective Bargaining Agreement of
December 18, 1956, which contains a master list classifying permanent
employees and workers into (a) regular monthly paid employee or worker,
(b) regular daily paid year-round worker, (c) regular milling season
worker, and (d) regular seasonal employee or worker. A tractorista or farmalista
by the very nature of his work, can not be employed as a whole year
round worker. Under the above section of the Agreement the HACIENDA
Luisita would have had the authority to change the status of the tractoristas and the farmalistas
into regular seasonal workers as early as December 18, 1956, were it
not for the decision of the court dated February 11, 1954, approving
the compromise agreement which only authorized assignment of tractoristas and farmalistas
to other work when not so employed. Were it not for the express
agreement that the misunderstanding would toe subject of future
litigation, we would have been inclined to grant the HACIENDA the right
to change the tractorista and farmalistas into
regular seasonal workers immediately from December 18, 1956 because
their work is not for the whole year round but only seasonal and the
change is expressly justified by Section 2 of Article I of the
subsequent bargaining agreement.
For the foregoing considerations, we find that the enforcement of
Section 3 of the compromise agreement of February 11, 1954, may be
terminated after three years therefrom. The order of the court below is
hereby reversed, without costs.
Paras, C. J., Bengzon, Montemayor, Bautista Angelo, Concepcion, Barrera, and Gutierrez David, JJ., concur.
Padilla and Reyes, J.B.L., JJ., did not take part.