PEPSI-COLA SALES AND ADVERTISING UNION, PETITIONER, VS. HON. SECRETARY OF LABOR AND ROBERTO ALISASIS, RESPONDENTS.

In its Decision in G.R. No. 80587 (Wenphil Corporation v.
NLRC), promulgated on February 8, 1989,^[1] this
Court^[2]
laid down the doctrine governing an illegal dismissal case where the employee
satisfactorily establishes that his employment was terminated without due
process — i.e., without written notice
to him of the charges against him and without according him opportunity to
defend himself personally or through a representative — but the employer
nevertheless proves the existence of just cause for the employee’s dismissal. The controlling principle in such a case is
that since the employee’s dismissal was for just cause, he is entitled neither
to reinstatement or back wages nor separation pay or salaries for the unexpired
portion of his contract, being entitled only to the salaries earned up to the
last day of employment; at the same time, however, as a general proposition,
the employer is obliged, on account of its failure to comply with the
requirements of due process in terminating the services of the employee, to pay
damages to the latter fixed at P1,000.00, a sum deemed adequate for the
purpose.

This doctrine, which has since been reaffirmed by this Court,^[3]
applies in the case at bar, in resolution of the issue of whether or not the
private respondent, Roberto Alisasis, may be considered to have been dismissed
for just cause within the meaning of the charter papers organizing and
governing a mutual aid program of which he was a participant.

From 1964 until sometime about 1985, Alisasis was an employee of
the Pepsi-Cola Bottling Co., Inc. and later, of the Pepsi-Cola Products
(Philippines) Inc., after the latter had bought out the former.^[4]
He was also a member of the labor organization of all regular route and truck
salesmen and truck helpers of the company — the Pepsi Cola Sales & Advertising
Union (PSAU) — from June 1, 1965 up to the termination of his employment in
1985.^[5]
As a member of the PSAU, he was also a participant in the “Mutual Aid
Plan” set up by said union sometime in 1980. During the entire period of his employment, there were regularly
deducted from his wages the amounts corresponding to union dues as well as
contributions to the fund of the Mutual Aid Plan.^[6]

On May 7, 1986, Alisasis filed with the NLRC Arbitration Branch,
Capital Region, Manila, a complaint for illegal dismissal against Pepsi-Cola,
Inc.^[7]
This resulted in a judgment by the Labor Arbiter dated January 25, 1988
declaring him to have been illegally dismissed and ordering the employer to
reinstate him “to his former position without loss of seniority rights and
with full backwages for one (1) year from the time he was not allowed to report
for work **.”^[8] The judgment was subsequently
affirmed with modification by the Fourth Division of the NLRC dated December
29, 1989,^[9]
disposing of the appeal as follows:^[10]

“In view therefore of the foregoing considerations, the
decision appealed from is hereby modified in the sense that the order for respondent to reinstate
complainant is hereby set aside. The rest of the
decision shall stand.”

The deletion of the relief of reinstatement was justified by the
NLRC in the following manner:^[11]

“Certainly, with the actuations of complainant,
respondent had ample reason or enough basis then to lose trust and confidence
in him. Complainant, being a
salesman, should be considered to have occupied a position of responsibility so
that, if respondent had lost trust and confidence in him, the former could
validly and legally terminate the services of the latter (Lamaan Trading,
Inc. vs. Leodegario, Jr., G.R. 73245, September 30, 1986).

However, although there was valid and lawful cause in the
dismissal of complainant by respondent, the manner in which it was effected was
not in accordance with law. Complainant was not given written notice by respondent but was only
verbally advised, thru its Field Sales Manager, sometime in May 1985 that he
should not report for work anymore, obviously, because there was a charge
against him. And this is what makes
the dismissal of complainant arbitrary and illegal for failure to comply with
the notice requirement under Batas Pambansa Blg. 130 on termination of
employees.

Ordinarily, when the dismissal of an employee is declared
unjustified or illegal, he is entitled to reinstatement and backwages (Art. 279
of the Labor Code). However, in the
instant case, considering that respondent
had already lost trust and confidence
in complainant which is founded on a reasonable ground, as discussed earlier,
there is no point in requiring respondent to reinstate complainant to his
former position. To do so would be tantamount
to compelling the management to employ someone whom it can no longer trust,
which is oppressive.”

It appears that both Alisasis and Pepsi-Cola, Inc. accepted the
NLRC’s verdict and complied therewith; that Pepsi-Cola gave Alisasis back wages
for one (1) year; and that Alisasis issued the corresponding quitclaim and
considered himself separated from his employment.

Alisasis thereafter asked his labor organization, PSAU, to pay
him monetary benefits in accordance with Section 3, Article X of the
“Amended By-Laws of the Mutual Aid Plan of the Pepsi-Cola Sales &
Advertising Union (U.O.E.F.),^[12] in
an amount equal to “One (P1.00) Peso per year of service multiplied by the
number of member(s) * *.”^[13] PSAU
demurred, invoking in its turn Section 1, Article XII of the same amended
by-laws, declaring as disqualified from any entitlement to the PLAN and **
(from any) Benefit or return of contributions ** under any circumstances,”
inter alia, “(a)ny member dismissed for cause.”^[14]

Alisasis thereupon filed a complaint against the union, PSAU,
with the Med-Arbitration Unit, National Capital Region, Department of
Labor and Employment, to compel the latter to pay him his claimed benefits.^[15]
The principal defenses alleged by PSAU were that Alisasis was disqualified to
claim any benefits under the Mutual Aid Plan, supra; and that the
Med-Arbiter had no original jurisdiction over the case since Alisasis’ claim
for financial assistance was not among the cases cognizable by Med-Arbiters
under the law “such as representation cases, internal union and
inter-union disputes ** (or) a violation of the union’s constitution and
by-laws and the rights and conditions of membership in a labor
organization.”^[16]
After due proceedings, the Med-Arbiter promulgated an Order on April 16, 1990,
ruling that he had jurisdiction and “ordering respondent ** (PSAU) to pay
complainant Roberto Alisasis ** his claim for financial assistance under the
Mutual Aid Fund of the union.” PSAU appealed to the Secretary of
Labor and Employment who, by Resolution dated July 25, 1990, denied the appeal
but reduced the Med-­Arbiter’s award from P18,669.00 to P17,886.00.^[17]
Nullification of the Med­-Arbiter’s Order of April 16, 1990 and the respondent Secretary’s
Resolution of July 25, 1990 is the prayer sought by the petitioner in the
special civil action of certiorari at bar.

Resolving first the issue of whether or not the case at bar is
within the original jurisdiction of the Med-Arbiter of the Bureau of Labor
Relations, the Court holds that it is.

The jurisdiction of the Bureau of Labor Relations and its
Divisions is set forth in the first paragraph of Article 226 of the Labor Code,
as amended, viz.:

“ART. 226. Bureau
of Labor Relations.— The Bureau of Labor Relations and the Labor Relations
Divisions in the regional offices of the Department of Labor shall have
original and exclusive authority to act, at their own initiative or upon
request of either or both parties, on all inter-union and intra-union
conflicts, and all disputes, grievances or problems arising from or affecting
labor-management relations in all workplaces whether agricultural or
non-agricultural, except those arising from the implementation or
interpretation of collective bargaining agreements which shall be the subject
of grievance procedure and/or voluntary arbitration.

” * * * .”

It is evident that the case at bar does not concern a dispute,
grievance or problem “arising from or affecting labor-management
relations.” So, if it is to be deemed as coming within the Med-Arbiter’s
jurisdiction, it will have to be as either an “intra-union” or
“inter-union” conflict.

No definition is given by law of these precise terms,
“intra-union and inter-union conflicts.” It is known, however, that
“intra-” and “inter-” are both combining forms, prefixes —
the first, “intra-,” meaning “within, inside of
[intramural, intravenous];” and the other, “inter-,”
denoting “1. between or among: the
second element is singular in form [interstate] 2. with or on each other (or one another), together, mutual,
reciprocal, mutually, or reciprocally [interact].”^[18]
An intra-union conflict would therefore refer to a conflict within or
inside a labor union, and an inter-union controversy or dispute, one
occurring or carried on between or among unions. In this sense, the controversy between Alisasis and his union,
PSAU — respecting the former’s rights under the latter’s “Mutual Aid
Plan” — would be an intra-union conflict under Article 226 of the
Labor Code and hence, within the exclusive, original jurisdiction of the
Med-Arbiter of the Bureau of Labor Relations whose decision, it may
additionally be mentioned, is appealable to the Secretary of Labor.

Certainly, said controversy is not one of those within the
jurisdiction of the Labor Arbiters in accordance with Article 217 of the Code,
it not being an unfair labor practice case, or a termination dispute, or one
involving wages, rates of pay, hours of work and other terms and conditions of
employment (which is “accompanied with a claim for reinstatement”),
or one for damages arising from the employer-employee relations, or one for a
violation of Article 264 of the Code, or any other claim arising from
employer-employee relations, or from the interpretation or implementation of a
collective bargaining agreement or of company personnel policies.

The second issue relates to the character of Alisasis’ dismissal
from employment. The Court holds that
Alisasis had indeed been “dismissed for cause.” His employer had
established this factual proposition by competent evidence to the satisfaction
of both the Labor Arbiter and the National Labor Relations Commission. In the latter’s view, and in its own words,
“Certainly, with the actuations of complainant,**
(Alisasis’ employer) had ample reason or enough basis then to lose trust and
confidence in him, *** considering that (said employer) had already lost trust
and confidence in complainant which is founded on a reasonable ground, as
discussed earlier, (and therefore) there is no point in requiring respondent to
reinstate complainant to his former position ** (as to) do so would be
tantamount to compelling the management to employ someone whom it can no longer
trust, which is oppressive.”

It was merely “the manner in which such a dismissal from
employment was effected * * (that was deemed as) not in accordance with law,
(there having been) failure to comply with the notice requirement under Batas
Pambansa Blg. 130 on termination of employees.” That imperfection is,
however, a circumstance quite distinct from the existence of what the NLRC has
clearly and expressly conceded to be a “valid and lawful cause in the
dismissal of complainant by respondent.” And this is precisely the reason
why, as already pointed out, the NLRC declined to accord to Alisasis all the
remedies or reliefs usually attendant upon an illegal termination of employment
— e.g., reinstatement, award of damages — although requiring payment by the
employer of the sum of P1,000.00, simply on account of its failure “to comply
with the notice requirement under Batas Pambansa Blg. 130 on termination of
employees.” The situation is on all fours with that in the Wenphil
Corporation Case,^[19]
cited in this opinion’s opening paragraph, in which the following
pronouncements, among others, were made:

“Thus in the present case, where the private respondent, who
appears to be of violent temper, caused trouble during office hours and even
defied his superiors as they tried to pacify him, should not be rewarded
with re-employment and back wages. It may encourage him to do even worse and will render a mockery of the rules of discipline
that employees are required to observe. Under the circumstances the dismissal of the private respondent for
just cause should be maintained. He
has no right to return to his former employer.

However, the petitioner (employer) must nevertheless be held to
account for failure to extend to private respondent his right to an
investigation before causing his dismissal. ** Thus, it must be imposed a
sanction for its failure to give a formal notice and conduct an investigation
as required by law before dismissing** (respondent) from employment. Considering the circumstances of this case petitioner
(employer) must indemnify the private respondent (employee) the amount of
P1,000.00. The measure of this
award depends on the facts of each case and the gravity of the omission
committed by the employer.”

The petitioner union (PSAU) was therefore quite justified in
considering Alisasis as a “member dismissed for cause,” and hence
disqualified under its amended by-laws to claim any “Benefit or return of
contributions ** under any circumstances, **.” The ruling to the contrary
of the Med-Arbiter and the Secretary of Labor and Employment must thus be set
aside as tainted with grave abuse of discretion.

WHEREFORE, the petition is granted and the writ of certiorari
prayed for issued, NULLIFYING and SETTING ASIDE the challenged Order of the
Med-Arbiter dated April 16, 1990 and the Resolution of the respondent Secretary
of Labor and Employment dated July 25, 1990, and DIRECTING THE DISMISSAL of
Alisasis’ complaint in NLRC Case No. NCR-Od-M-90-01-037, without pronouncement
as to costs.

SO ORDERED.

Padilla, Regalado, and
Nocon, JJ., concur.

Paras*, J., retired.

^[1]
170 SCRA 69

^[2]
First Division, per Gancayco, J., who has since retired

^[3]
SEE Seahorse Maritime Corp. v. NLRC, 173 SCRA 390 (1989); Kwikway
Engineering Works v. NLRC, 195 SCRA 526 (1991)

^[4]
Rollo, pp. 37-38

^[5]
Id., pp. 25, 32-33

^[6]
Id., pp. 25, 55

^[7]
Docketed as NLRC NCR Case No. 5-1794-86

^[8]
Rollo., p. 37

^[9]
Id., pp. 37-44

^[10]
Italics supplied

^[11]
Rollo, pp. 42-43 – Italics supplied

^[12]
Id., pp. 45-54

^[13]
Id., p. 51

^[14]
Id., p. 52

^[15]
The complaint was filed on January 17, 1990, and was docketed as Case No.
NCR-Od-­M-90-01-037

^[16]
Rollo, p. 6

^[17]
Id., p. 26, Annex D, petition

^[18]
Webster’s New World Dictionary of the American Language, Second College
Edition. Webster’s Third New
International Dictionary, 1986 ed., describes “inter-” as a
“prefix ** (signifying) 1: between, among, in the midst [intermediate] [interspace] 2: mutual,
reciprocal [intermarry] [intermesh] [interrelation] [intertwine]
3: between or among the parts of [intercostal] [interdental]
4: carried on between [intercollegiate] [intercommunication]
[international] 5: occurring between: intervening [interglacial]
[intertidal] 6: shared by or derived from two or more
[interdepartmental] [interfaith] 7: between the limits of
: within [intertropical] —
“intra” as another prefix meaning 1a : within — esp. in
adjectives formed from adjectives [intraglacial] [intravaginal] [intracellular]
[intra-European] [intracosmical] * * * .”

^[19]
170 SCRA 69, 76; italics and parenthetical insertions supplied. The doctrine has since been applied to other
cases: SEE footnote 3, supra.

* Retired as of July 4, 1992