REPUBLIC OF THE PHILIPPINES, REPRESENTED BY THE NATIONAL PARKS DEVELOPMENT COMMITTEE, PETITIONER, VS. THE HON. COURT OF APPEALS AND THE NATIONAL PARKS DEVELOPMENT SUPERVISORY AS…

Republic of the Philippines versus Court of Appeals

The Case

This is a petition for review brought by the Republic of the Philippines, represented by the National Parks Development Committee, against the Court of Appeals and the National Parks Development Supervisory Employees Association and its affiliated unions. The Republic asks the Supreme Court to reverse the ruling below that the labor dispute between the Committee and its striking employees falls within the jurisdiction of the Department of Labor and Employment. The case matters because it settles a threshold question of status: whether the National Parks Development Committee is a government agency or a private corporation. On that answer turns the right of its employees to strike, the law that governs them, and the forum that hears their disputes.

Procedural History

The Committee filed a complaint in the Regional Trial Court of Manila, Branch Fifty-Two, praying that the strike be declared illegal and restrained. The trial court dismissed the complaint for lack of jurisdiction and lifted the restraining order. It held that the case properly falls under the jurisdiction of the Department of Labor because an employer-employee relationship exists between the Committee and the strikers, and because the acts complained of fall under the Labor Code provisions on strikes, which place jurisdiction in the Labor Arbiters.

The Committee then went to the Court of Appeals on certiorari. The Court of Appeals affirmed the order of the trial court. Hence, this petition for review before the Supreme Court, where the Committee alleged that the Court of Appeals erred in not holding that its employees are covered by the Civil Service Law, and in ruling that the labor dispute is cognizable by the Department of Labor.

Facts

The National Parks Development Committee was originally created in 1963 under Executive Order Number 30 as the Executive Committee for the development of the Quezon Memorial, Luneta, and other national parks. It was later renamed the National Parks Development Committee. Despite this governmental origin, it was registered with the Securities and Exchange Commission as a non-stock, non-profit corporation known as The National Parks Development Committee, Incorporated.

In August 1987, the Securities and Exchange Commission ordered the Committee to show cause why its certificate of registration should not be suspended for failure to submit required reports and for failure to operate for a continuous period of at least five years. The then Chairman of the Committee informed the Commission that his office had no objection to the suspension, cancellation, or revocation of the certificate. By virtue of Executive Order Number 120, the Committee was attached to the Ministry, later the Department, of Tourism and provided with a separate budget subject to audit by the Commission on Audit. The Civil Service Commission then notified the Committee that all appointments and personnel actions shall be submitted through the Commission.

Meanwhile, the Rizal Park Supervisory Employees Association, composed of employees holding supervisory positions, was organized and affiliated with the Trade Union of the Philippines and Allied Services. Two collective bargaining agreements were entered into between the Committee and its two unions, for a period of two years or until June 30, 1989. On March 20, 1988, the unions staged a strike at the Rizal Park, Fort Santiago, Paco Park, and Pook ni Mariang Makiling in Los Banos, Laguna, alleging unfair labor practices. The next day, the Committee filed its complaint to declare the strike illegal and to restrain it, on the ground that the strikers, being government employees, have no right to strike although they may form a union.

Issues

• Whether or not the National Parks Development Committee is a government agency whose employees are covered by the Civil Service Law.
• Whether or not the labor dispute between the Committee and its employees is cognizable by the Department of Labor and Employment.

Applicable Provisions

Section 2, Article Nine of the 1987 Constitution provides:

The civil service embraces all branches, subdivisions, instrumentalities, and agencies of the Government, including government-owned or controlled corporations with original charters.

This provision supplies the test of coverage: if the Committee is a government agency, its employees fall within the civil service.

Section 14 of Executive Order Number 180 provides:

All employees of government agencies shall be civil service employees.

This confirms that the employees of the Committee, being employees of a government agency, are civil service employees.

Section 15 of Executive Order Number 180, dated June 1, 1987, provides:

The Public Sector Labor-Management Council shall hear and decide labor disputes between the government and its employees.

This fixes the forum: not the Department of Labor and Employment, but the Public Sector Labor-Management Council.

Ruling

On the first issue, the Court held that the National Parks Development Committee is an agency of the government, not a government-owned or controlled corporation. It relied on its earlier ruling in Perlas versus People, where it had already declared the Committee a government agency, so that the Sandiganbayan had jurisdiction over its acting director. The Court traced the Committee's history: created by executive order, renamed by executive order, placed under the Office of the President, and listed in annual appropriation decrees as a regular government agency with allotments issued directly to it. Being a government agency, its employees are covered by civil service rules and regulations, and are civil service employees.

On the second issue, the Court held that while the employees are allowed under the 1987 Constitution to organize and join unions of their choice, there is as yet no law permitting them to strike. In case of a labor dispute between the employees and the government, it is the Public Sector Labor-Management Council, not the Department of Labor and Employment, that shall hear the dispute. The Court therefore concluded that both the Court of Appeals and the trial court erred in holding that the labor dispute is cognizable by the Department of Labor and Employment.

Doctrine

First, the National Parks Development Committee is a government agency, not a government-owned or controlled corporation. Its corporate registration does not change its true character, which is fixed by its creation, its placement under the Office of the President, and its direct budgetary appropriations.

Second, employees of a government agency are civil service employees under Section 2, Article Nine of the 1987 Constitution and Section 14 of Executive Order Number 180.

Third, government employees may organize and join unions, but they have no right to strike, because no law permits it.

Fourth, labor disputes between the government and its employees are heard by the Public Sector Labor-Management Council under Section 15 of Executive Order Number 180, not by the Department of Labor and Employment.

Disposition

The petition for review was granted, the decision of the Court of Appeals was set aside, and the private respondents were directed to file their complaint in the Public Sector Labor-Management Council, with costs against them.

Remember This

Memorize this line: the National Parks Development Committee is a government agency, so its employees are civil service employees who may unionize but may not strike, and their disputes go to the Public Sector Labor-Management Council. Examiners use this case to test the government agency versus government-owned or controlled corporation distinction, the no-strike rule for government employees, and the correct forum for public sector labor disputes.