MANILA CORDAGE COMPANY, PETITIONER, VS. FERNANDO VIBAR, ET AL., RESPONDENTS.

Manila Cordage versus Vibar

The Case

This is a labor case that began as a strike and ended as a question about how long a court may keep control of its own final order. The Manila Cordage Company, the employer, is pitted against Fernando Vibar and other workers who were among the strikers of 1949. The workers asked the Court of Industrial Relations to enforce a return-to-work order and to grant them backwages; the company resisted, saying the order had long become final and could no longer be touched. The case matters because it fixes two rules a reviewee must know: the continuing power of the Court of Industrial Relations to modify even final orders, and the principle that a grace period extended to illegal strikers is not to be stretched.

Procedural History

A labor dispute between the company and the Manila Cordage Workers Union led to a strike declared in August 1949. The strike was submitted for compulsory arbitration to the Court of Industrial Relations, which in an order dated September 16, 1949 declared the strike highly unjustified and unreasonable. Instead of ordering dismissal, the court ordered the strikers to return to their posts within two days from receipt, failing which the company was authorized to replace them with new workers. The court later explained that this was an act of grace, giving the strikers a chance to keep their jobs, and it imposed on them, as a preventive measure, a prohibition against declaring another strike within three years.

In October 1958 the respondents, who were among the 1949 strikers, filed a complaint with the Court of Industrial Relations. They alleged that they had offered to return to their former positions under the return-to-work order but that the company refused them admission. They prayed for reinstatement, retirement benefits, three years of backpay for the Japanese occupation period, separation pay of one half month for every year of service from the start of their employment to August 1949, and other benefits. In a decision dated April 20, 1963, the Court of Industrial Relations denied all the claims but awarded full backwages from September 20, 1949 up to the period when their replacements were hired, not to exceed thirty days. The company protested the award of backwages, its motion for reconsideration was denied, and the company brought the matter to the Supreme Court.

Facts

In August 1949 the workers of the Manila Cordage Company went on strike. The Court of Industrial Relations found the strike highly unjustified and unreasonable. Rather than order the strikers dismissed, the court extended grace: they were to return to their posts within two days from receipt of the order, and only if they failed could the company replace them with new workers. The order was received on September 17, 1949, so the strikers had until September 19 to abandon the strike and return.

Nine years later, in October 1958, Fernando Vibar and the other respondents filed a complaint to enforce that order. They claimed they had offered to return but were refused admission. The Court of Industrial Relations found that they had reported back in September 1949 and again in January 1950, January 1953, and January 1956, and that company officials had told them they would be notified when they could be called back to work. On that finding the court awarded them backwages, though limited to thirty days.

The Supreme Court found the record told a different story. On September 27, 1949 the company had to ask for an injunction precisely because the respondents were intimidating strikers who wanted to return to work, and the injunction issued the next day. In November 1949 the union itself asked the court to clarify whether its motion for reconsideration had suspended the two-day ultimatum, and the court said it had not. And in their own bill of particulars the respondents stated that they tried to return to their former positions only sometime in October 1949, February 1950, January 1953, and January 1956.

Issues

• Whether or not the Court of Industrial Relations retained the power, after the lapse of nine years and after its return-to-work order had become final, to amend that order and award backwages.
• Whether or not the respondents' action, filed nine years after they were refused admission, was barred for not having been brought within a reasonable time, say one year.
• Whether or not the respondents returned to work within the two-day period fixed in the return-to-work order, and were therefore entitled to backwages.

Applicable Provisions

Sections 7 and 17 of Commonwealth Act Number 103, as discussed in the decision, empower the Court of Industrial Relations to modify its decisions, orders, and awards even after they have become final:

The Court of Industrial Relations shall have power to modify its decisions, orders and awards, even after their finality.

This is the source of the continuing jurisdiction the Court upheld over the original strike case, and it is the answer to the company's claim that the order could no longer be touched.

Ruling

On the first issue, the Court held that the Court of Industrial Relations retained the power to amend its order. The company had relied on the San Pablo Oil Factory case, but the Court explained that its rationale is not that the industrial court is powerless to modify its decision; it is that matters already passed upon can no longer be reopened after the decision has become final. Where the matter came into existence only after the rendition of the decision, the industrial court keeps the power to amend. Here the reinstatement was made subject to the condition that the strikers give themselves up within two days, so the court certainly retained the power to inquire later whether they had returned within that period. That power derives from Sections 7 and 17 of Commonwealth Act Number 103, and its purpose is to vest in the Court of Industrial Relations continuing control over a case even after its decision has become final and executory, in order to accord substantial justice to the parties. The enactment of the Industrial Peace Act did not affect that power.

On the second issue, the Court held that the action was not barred. It is true that in one case the statement was made that actions for reinstatement must be filed within a reasonable time, say one year. But the respondents' action is not an action for reinstatement. Their right to reinstatement had already been established in the return-to-work order of September 16, 1949; the case was filed only to enforce that right.

On the third issue, the Court ruled for the company. The return-to-work order was received on September 17, 1949, so the strikers had until September 19 to return. The record showed they did not. The injunction of September 28, 1949 showed they were still maintaining the illegal strike as of September 27. The union's own request for clarification in November 1949 showed the same. And their bill of particulars admitted they offered to return only sometime in October 1949. The Court could not accept the industrial court's rationalization that, pending clarification, the strikers had a right to exercise their economic weapon of maintaining the picket line, for the same court had itself held that the two-day period was not suspended and that the strike was unjustified and unreasonable. The two-day period was an act of grace intended to give the strikers every chance to make good after their strike had been found illegal. In not taking advantage of that opportunity, the respondents showed themselves undeserving of further consideration. The company had the right to replace them and should not be penalized for exercising that right by being made to pay backwages.

Doctrine

First, the Court of Industrial Relations retains continuing control over a case even after its decision has become final and executory, and may modify its decisions, orders, and awards under Sections 7 and 17 of Commonwealth Act Number 103, in order to accord substantial justice to the parties. The finality rule bars reopening matters already passed upon, but it does not bar the court from acting on matters that came into existence only after the decision was rendered, such as whether a condition attached to a return-to-work order was complied with.

Second, an action to enforce a right to reinstatement already established by a final return-to-work order is not an action for reinstatement, and the one-year reasonable-time rule for reinstatement actions does not apply to it.

Third, a return-to-work period extended to strikers whose strike has been declared illegal is an act of grace. A striker who fails to return within that period may be replaced, and the employer may not be made to pay backwages for exercising that right.

Disposition

The company won: the order of April 30, 1963 and the resolution of May 17, 1963, insofar as they awarded backwages to the respondents, were reversed, without pronouncement as to costs.

Remember This

Memorize the line that the industrial court's power to modify even final orders exists to accord substantial justice, and that the two-day return-to-work period was grace the strikers failed to use. Examiners use this case on the continuing jurisdiction of the Court of Industrial Relations under Sections 7 and 17 of Commonwealth Act Number 103, and on the rule that backwages cannot be charged against an employer who validly replaced strikers who ignored a return-to-work order.