Villar vs.
Inciong
L-50283-84
April 20, 1983
FACTS:
AEU under FUR attempted to have a certification election but due to the opposition
of AEU-PAFLU, the petition was denied by the Med-Arbiter.
AEU-PAFLU then called a special meeting among members and it was there decided
that an investigation of certain people would be held pursuant to the constitution and
by-laws of the Federation, of all of the petitioners and one Felipe Manlapao, for
"continuously maligning, libelling and slandering not only the incumbent officers but
even the union itself and the federation;" spreading 'false propaganda' that the
union officers were 'merely appointees of the management', and for causing
divisiveness in the union.
A Trial Committee was then formed to investigate the local union's charges against
the petitioners for acts of disloyalty. AEU-PAFLU and the Company concluded a
new CBA which, besides granting additional benefits to the workers, also
reincorporated the same provisions of the existing CBA, including the union security
clause reading, to wit:
All members of the UNION as of the signing of this Agreement shall remain
members thereof in good standing. Therefore, any members who shall resign, be
expelled, or shall in any manner cease to be a member of the UNION, shall be
dismissed from his employment upon written request of the UNION to the Company.
The petitioners were summoned to appear before the PAFLU Trial Committee for the
aforestated investigation of the charges filed against them but they did not attend and
instead requested for a "Bill of Particulars" of the charges which had been formalized
by the AEU-PAFLU officers; they contend that their actions were merely exercise of
the right to freedom of association.
Not recognizing PAFLU's jurisdiction over their case, petitioners again refused to
participate in the investigation rescheduled and conducted. Instead, they merely
appeared to file their Answer to the charges and moved for a dismissal.
Based on the findings and recommendations of the PAFLU trial committee, the
PAFLU President found the petitioners guilty of the charges against them and it was
requested that they be terminated in conformity with the security clause in the CBA.
Meanwhile, they were placed under preventive suspension and denied access to the
workplace.
1
ISSUE:
Whether or not the Minister acted with grave abuse of discretion when he affirmed
the decision of the RO4-Officer-in-Charge allowing the preventive suspension and
subsequent dismissal of petitioners by reason of the exercise of their right to freedom
of association.
HELD:
It is true that disaffiliation from a labor union is not open to legal objection. It is
implicit in the freedom of association ordained by the Constitution. However, a
closed shop is a valid form of union security, and such provision in a CBA is not a
restriction of the right of freedom of association guaranteed by the Constitution.
Here, the Company and the AEU-PAFLU entered into a CBA with a union security
clause and the stipulation for closed-shop is clear and unequivocal and it leaves no
room for doubt that the employer is bound, under the collective
bargaining agreement, to dismiss the employees, herein petitioners, for non-
union membership.
Petitioners became non-union members upon their expulsion from the
general membership of the AEU-PAFLU pursuant to the Decision of the PAFLU
national president.
PAFLU had the authority to investigate petitioners on the charges filed by their co-
employees in the local union and after finding them guilty as charged, to expel them
from the roll of membership under the constitution of the PAFLU to which the local
union was affiliated.
According to the OIC: dtripped of non-essentials, the basic and fundamental issue in
this case tapers down to the determination of WHETHER OR NOT PAFLU HAD
THE AUTHORITY TO INVESTIGATE OPPOSITORS AND, THEREAFTER,
EXPEL THEM FROM THE ROLL OF MEMBERSHIP OF THE
AMIGOEMPLOYEES UNION-PAFLU.
Recognized and salutary is the principle that when a labor union affiliates with a
mother union, it becomes bound by the laws and regulations of the parent
organization.
When a labor union affiliates with a parent organization or mother union, or accepts
a charter from a superior body, it becomes subject to the laws of the superior body
under whose authority the local union functions. The constitution, by-laws and rules
of the parent body, together with the charter it issues pursuant thereto to the
subordinate union, constitute an enforceable contract between the parent body and
the subordinate union, and between the members of the subordinate union inter se.

'Due process' simply means that the parties were given the opportunity to be heard.
In the instant case, ample and unmistakable evidence exists to show that the
oppositors were afforded the opportunity to present their evidence, but they
themselves disdained or spurned the said opportunity given to them.

Inherent in every labor union, or any organization, is the right of self-preservation.

When members of a labor union, therefore, sow the seeds of dissension and strife
within the union; when they seek the disintegration and destruction of the very union
to which they belong, they thereby forfeit their rights to remain as members of the
union which they seek to destroy.

We, therefore, hold and rule that petitioners, although entitled to disaffiliate from
their union and form a new organization of their own, must, however, suffer the
consequences of their separation from the union under the security clause of the
CBA.

2

Tanduay Distillery Labor Union vs NLRC
G.R. No. 75037
April 30, 1987
FACTS:
Private respondents were all employees of Tanduay Distillery, Inc., (TDI) and
members of the Tanduay Distillery Labor Union (TDLU), a duly organized and
registered labor organization and the exclusive bargaining agent of the rank and file
employees of the petitioner company.
A Collective Bargaining Agreement (CBA), was executed between TDI and TDLU.
The CBA was duly ratified by a majority of the workers in TDI including herein
private respondents and contained a union security clause which provides that all
workers who are or may during the effectivity of the CBA, become members of the
Union in accordance with its Constitution and By-Laws shall, as a condition of their
continued employment, maintain membership in good standing in the Union for the
duration of the agreement.
b) whether or not TDI is guilty of unfair labor practice in complying with TDLU's
demand for the dismissal of private respondents.
HELD:
The dismissal of an employee pursuant to a demand of the majority union in
accordance with a union security agreement following the loss of seniority rights is
valid and privileged and does not constitute an unfair labor practice.
Article 249 (e) of the Labor Code as amended specifically recognizes the closed shop
arrangement as a form of union security. The closed shop, the union shop, the
maintenance of membership shop, the preferential shop, the maintenance of treasury
shop, and check-off provisions are valid forms of union security and strength. They
do not constitute unfair labor practice nor are they violations of the freedom of
association clause of the Constitution. There is no showing in these petitions of any
arbitrariness or a violation of the safeguards enunciated in the decisions of this Court
interpreting union security arrangements brought to us for review.

While the CBA was in effect and within the contract bar period the private
respondents joined another union, the Kaisahan Ng Manggagawang
Pilipino (KAMPIL) and organized its local chapter in TDI. KAMPIL filed a petition
for certification election to determine union representation in TDI, which
development compelled TDI to file a grievance with TDLU.
TDLU created a committee to investigate its erring members in accordance with its
by-laws which are not disputed by the private respondents. Thereafter, TDLU,
through the Investigating Committee and approved by TDLU's Board of Directors,
expelled the private respondents from TDLU for disloyalty to the Union. By letter,
TDLU notified TDI that private respondents had been expelled from TDLU and
demanded that TDI terminate the employment of private, respondents because they
had lost their membership with TDLU.
The private respondents were later on terminated. In their petition, private
respondents contend that their act of organizing a local chapter of KAMPIL and
eventual filing of a petition for certification election was pursuant to their
constitutional right to self-organization.

ISSUES:
a) whether or not TDI was justified in terminating private respondents' employment
in the company on the basis of TDLU's demand for the enforcement of the Union
Security Clause of the CBA between TDI and TDLU; and

3
 of their collective bargaining agreement and the Hotel acceded by placing Beloncio
on forced leave effective August 10, 1984.

The union security clause of the collective bargaining agreement provides:

Section 2. Dismissals.
G.R. No. 76989 September 29, 1987
xxx xxx xxx
MANILA MANDARIN EMPLOYEES UNION, petitioners,
vs. b) Members of the Union who cease to be such members and/or
NATIONAL LABOR RELATIONS COMMISSION, and MELBA C. who fail to maintain their membership in good standing therein by
BELONCIO, respondents. reason of their resignation from the Union and/or by reason of
their expulsion from the Union in accordance with the Constitution
and By-Laws of the Union, for non-payment of union dues and
other assessment for organizing, joining or forming another labor
organization shall, upon written notice of such cessation of
GUTIERREZ, JR., J.:
membership or failure to maintain membership in the Union and
upon written demand to the company by the Union, be dismissed
This is a petition to review on certiorari the National Labor Relations Commission's
from employment by the Company after complying with the
(NLRC) decision which modified the Labor Arbiter's decision and ordered the
requisite due process requirement; ... (Emphasis supplied) (Rollo,
Manila Mandarin Employees Union to pay the wages and fringe benefits of Melba C.
p. 114)
Beloncio from the time she was placed on forced leave until she is actually
reinstated, plus ten percent (10%) thereof as attorney's fees. Manila Mandarin Hotel
Two days before the effective date of her forced leave or on August 8, 1984,
was ordered to reinstate Beloncio and to pay her whatever service charges may be
Beloncio filed a complaint for unfair labor practice and illegal dismissal against
due her during that period, which amount would be held in escrow by the hotel.
herein petitioner-union and Manila Mandarin Hotel Inc. before the NLRC,
Arbitration Branch.
The petition was filed on January 19, 1987. The private respondent filed her
comment on March 7, 1987 while the Solicitor General filed a comment on June 1,
Petitioner-union filed a motion to dismiss on grounds that the complainant had no
1987 followed by the petitioner's reply on August 22, 1987. We treat the comment as
cause of action against it and the NLRC had no jurisdiction over the subject matter of
answer and decide the case on its merits.
the complaint.

The facts of the case are undisputed.

This motion was denied by the Labor Arbiter.

Herein private respondent, Melba C. Beloncio, an employee of Manila Mandarin

After the hearings that ensued and the submission of the parties' respective position
Hotel since 1976 and at the time of her dismissal, assistant head waitress at the
papers, the Labor Arbiter held that the union was guilty of unfair labor practice when
hotel's coffee shop, was expelled from the petitioner Manila Mandarin Employees
it demanded the separation of Beloncio. The union was then ordered to pay all the
Union for acts allegedly inimical to the interests of the union. The union demanded
wages and fringe benefits due to Beloncio from the time she was on forced leave
the dismissal from employment of Beloncio on the basis of the union security clause

4
until actual reinstatement, and to pay P30,000.00 as exemplary damages and
P10,000.00 as attorney's fees. The charge against the hotel was dismissed.
The Union then appealed to the respondent NLRC which modified the Labor
Arbiter's decision as earlier stated.
happened to be a union steward, "Wala akong tiwala sa Union ninyo." The remark
was made in the course of a heated discussion regarding Beloncio's efforts to make a
lazy and recalcitrant waiter adopt a better attitude towards his work.
We agree with the Solicitor General when he noted that:

A subsequent motion for reconsideration and a second motion for reconsideration ... The Labor Arbiter explained correctly that "(I)f the only
were denied. question is the legality of the expulsion of Beloncio from the
Union undoubtedly, the question is one cognizable by the BLR
Hence, this present petition. (Bureau of Labor Relations). But, the question extended to the
dismissal of Beloncio or steps leading thereto. Necessarily, when
The petitioner raises the following assignment of errors: the hotel decides the recommended dismissal, its acts would be
subject to scrutiny. Particularly, it will be asked whether it violates
I or not the existing CBA. Certainly, violations of the CBA would be
unfair labor practice."
THAT RESPONDENT NLRC ERRED IN NOT DECLARING
THAT THE PRESENT CONTROVERSY INVOLVED INTRA- Article 250 of the Labor Code provides the following:
UNION CONFLICTS AND THEREFOR IT HAS NO
JURISDICTION OVER THE SUBJECT-MATTER THEREOF. Art. 250. Unfair labor practices of labor
organizations. It shall be unfair labor practice
II for a labor organization, its officers, agents or
representatives:
THAT RESPONDENT NLRC SERIOUSLY ERRED IN
HOLDING PETITIONER LIABLE FOR THE PAYMENT OF xxx xxx xxx
PRIVATE RESPONDENT'S SALARY AND FRINGE
BENEFITS, AND AWARD OF 10% ATTORNEY'S FEES, (b) To cause or attempt to cause an employer to
AFTER FINDING AS UNMERITORIOUS HER PRETENDED discriminate against an employee, including
CLAIMS OR COMPLAINTS FOR UNFAIR LABOR discrimination against an employee with respect
PRACTICE, ILLEGAL DISMISSAL, AND DAMAGES. (Rollo, to whom membership in such organization has
pp. 6-9) been denied or to terminate an employee on any
ground other than the usual terms and
On the issue of the NLRC jurisdiction over the case, the Court finds no grave abuse conditions under which membership or
of discretion in the NLRC conclusion that the dispute is not purely intra-union but continuation of membership is made available to
involves an interpretation of the collective bargaining agreement (CBA) provisions other members. (Emphasis supplied)
and whether or not there was an illegal dismissal. Under the CBA, membership in
the union may be lost through expulsion only if there is non-payment of dues or a Article 217 of the Labor Code also provides:
member organizes, joins, or forms another labor organization. The charge of
disloyalty against Beloncio arose from her emotional remark to a waitress who
5
 Art. 217. Jurisdiction of Labor Arbiters and the
Commission (a) The Labor Arbiters shall have
the original and exclusive jurisdiction to hear
and decide ... the following cases involving all
workers, whether agricultural or nonagricultural;
(1) Unfair labor practice cases;
xxx xxx xxx
(b) The Commission shall have exclusive
appellate jurisdiction over all cases decided by
Labor Arbiters. (Rollo, pp. 155-157.)
The petitioner also questions the factual findings of the public respondent on the
reasons for Beloncio's dismissal and, especially, on the argument that she was on
forced leave; she was never dismissed; and not having worked, she deserved no pay.
The Court finds nothing in the records that indicates reversible error, much less grave
abuse of discretion, in the NLRC's findings of facts.
It is a well-settled principle that findings of facts quasi-judicial agencies like the
NLRC, which have acquired expertise because their jurisdiction is confined to
specific matters, are generally accorded not only respect but at times even finality if
such findings are supported by substantial evidence. (Akay Printing Press vs.
Minister of Labor and Employment, 140 SCRA 381; Alba Patio de Makati vs. Alba
Patio de Makati Employees Association, 128 SCRA 253; Dangan vs. National Labor
Relations Commission, 127 SCRA 706; De la Concepcion vs. Mindanao Portland
Cement Corporation, 127 SCRA 647).
The petitioner now questions the decision of the National Labor Relations
Commission ordering the reinstatement of the private respondent and directing the
Union to pay the wages and fringe benefits which she failed to receive as a result of
her forced leave and to pay attorney's fees.
We find no error in the questioned decision.
6
The Hotel would not have compelled Beloncio to go on forced leave were it not for
the union's insistence and demand to the extent that because of the failure of the hotel
to dismiss Beloncio as requested, the union filed a notice of strike with the Ministry
of Labor and Employment on August 17, 1984 on the issue of unfair labor practice.
The hotel was then compelled to put Beloncio on forced leave and to stop payment
of her salary from September 1, 1984.
Furthermore, as provided for in the collective bargaining agreement between the
petitioner-the Union and the Manila Mandarin Hotel "the Union shall hold the
Company free and blameless from any and all liabilities that may arise" should the
employee question the dismissal, as has happened in the case at bar.
It is natural for a union to desire that all workers in a particular company should be
its dues-paying members. Since it would be difficult to insure 100 percent
membership on a purely voluntary basis and practically impossible that such total
membership would continuously be maintained purely on the merits of belonging to
the union, the labor movement has evolved the system whereby the employer is
asked, on the strength of collective action, to enter into what are now familiarly
known as "union security" agreements.
The collective bargaining agreement in this case contains a union security clause
a closed-shop agreement.
A closed-shop agreement is an agreement whereby an employer binds himself to hire
only members of the contracting union who must continue to remain members in
good standing to keep their jobs. It is "the most prized achievement of unionism." It
adds membership and compulsory dues. By holding out to loyal members a promise
of employment in the closed-shop, it welds group solidarity. (National Labor Union
vs. Aguinaldo's Echague, Inc., 97 Phil. 184). It is a very effective form of union
security agreement.
This Court has held that a closed-shop is a valid form of union security, and such a
provision in a collective bargaining agreement is not a restriction of the right of
freedom of association guaranteed by the Constitution. (Lirag Textile Mills, Inc. vs.
Blanco, 109 SCRA 87; Manalang vs. Artex Development Company, Inc., 21 SCRA
561).
The Court stresses, however, that union security clauses are also governed by law
and by principles of justice, fair play, and legality. Union security clauses cannot be
used by union officials against an employer, much less their own members, except
with a high sense of responsibility, fairness, prudence, and judiciousness.
A union member may not be expelled from her union, and consequently from her
job, for personal or impetuous reasons or for causes foreign to the closed-shop
agreement and in a manner characterized by arbitrariness and whimsicality.
This is particularly true in this case where Ms. Beloncio was trying her best to make
a hotel bus boy do his work promptly and courteously so as to serve hotel customers
in the coffee shop expeditiously and cheerfully. Union membership does not entitle
waiters, janitors, and other workers to be sloppy in their work, inattentive to
customers, and disrespectful to supervisors. The Union should have disciplined its
erring and troublesome members instead of causing so much hardship to a member
who was only doing her work for the best interests of the employer, all its
employees, and the general public whom they serve.
WHEREFORE, the petition is hereby DISMISSED. The questioned decision of the
National Labor Relations Commission is AFFIRMED. Costs against the petitioner.
SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
7
G.R. No. L-19779 July 30, 1966
RIZAL LABOR UNION, CARLOS SANTOS, EDILBERTO REYES,
TEOFENES MINGUILLAN, APRONIANO CELAJES, AUGUSTO
RAYMUNDO, CELESTINO RINO, EDMUNDO GARCIA, JOSE EVANCHES,
MELENCIO ENRIQUEZ, PEDRO ANTAZO, BENJAMIN ONGKIATCO,
FELIX ADSUARA, GREGORIO YUNZAL and VICENTE
INAMAC, petitioners,
vs.
RIZAL CEMENT COMPANY, INC., JUAN DE LEON, RODOLFO
FAUSTINO, BINANGONAN LABOR UNION LOCAL 104, FILOMENO
PRUDON, NICANOR MEYCACAYAN, MACARIO CENIDOZA, APOLONIO
SUMALDE, LOTARIO BATAN, FRANCISCO EVANGELISTA, DOMINGO
PUBLICO, HON. ARSENIO MARTINEZ, Judge, Court of Industrial
Relations, HON. EMILIANO TABIGNE, Judge, Court of Industrial Relations,
and HON. AMANDO BUGAYONG, Judge, Court of Industrial
Relations, respondents.
Pedro A. Lopez for petitioner.
Bausa, Ampil and Suarez for respondent Rizal Cement Co., Inc.
Mariano B. Tuazon for respondent Court of Industrial Relations.
A. V. Villacorta for respondent Union.
BARRERA, J.:
This is a petition filed by the Rizal Labor Union for the review of the resolution of
the Court of Industrial Relations en banc (in Case No. 16115-ULP), dismissing the
petition for unfair labor practice filed against the Binangonan Labor Union, Local
104 and the Rizal Cement Company.1wph1.t
On February 13, 1958, Carlos Santos and 14 other employees of the Rizal Cement
company, while still members of the Binangonan Labor Union Local 104, formed
and organized the Rizal Labor Union. The company was notified thereof on March
18, 1958. Prior to this date or on March 15, 1958, Carlos Santos and Teofines
Minguillan, president and secretary, respectively, of the newly-organized Rizal Labor
Union, received identical letters from the Binangonan Labor Union, requiring them
to explain in 48 hours why they should not be expelled for disloyalty. Although
Santos and Minguillan requested for the convocation of a general meeting of the
members of the Binangonan Labor Union to explain their side, the 15 organizers of
the new union were expelled from their original union on March 21, 1958. On the
same day, it demanded the dismissal of the expelled members from employment,
which the company did on March 22, 1958.
The dismissed employees went to the Court of Industrial Relations charging the
Company and the Binangonan Labor Union with unfair labor practices. Said
respondents answered the charges by referring to the alleged closed-shop proviso in
the subsisting collective bargaining agreement between them. After due hearing, the
trial judge rendered a decision holding that the supposed closed-shop proviso, while
valid, was inadequate to justify the dismissal of complainants from employment. The
company was thus ordered to reinstate them and both respondents were directed to
pay, jointly and severally, the complainants their back wages. Upon respondents,
motion for reconsideration, the judgment of the trial Judge was reversed by the
court en banc. The dismissal of complainants was found to be justified by the closed
shop proviso of the collective bargaining agreement, although they were declared
entitled to separation pay. Complainants filed the present petition for review.
The only issue presented in this case is whether the dismissal of the complaining 15
employees was justified or not. The resolution of this question hinges on the validity
and adequacy of the supposed closed-shop proviso of the collective bargaining
contract between respondent Company and respondent union. For, it is axiomatic
that in order that the discharge of an employee pursuant to a closed-shop agreement
may be considered justified, it must first be shown that the said agreement is valid.
The provisions of the contract relied by respondents read as follows:
The EMPLOYER agrees to have in its employ and to employ only members
in good standing of the UNION in all its branches, units, plants, quarries,
warehouses, docks, etc. The UNION agrees to furnish at all time the
laborers, employees and all technical helps that the EMPLOYER may
require. EMPLOYER, however, reserves its right to accept or reject where
they fail to meet its requirements. (Article 1, Sec. 5.)
The EMPLOYER agrees not to have in its employ nor to hire any new
employee or laborer unless he is a member of good standing of the UNION,
and a bona fide holder of a UNION (NWB) card, provided such new
employee or laborer meets the qualifications required by the EMPLOYER.
(Article VII, Sec. 1-d).
8
The trial Judge construed the first, Article 1, Section 5, as applicable to those already
on the job at the time the agreement was entered into in 1954,1 while Article VII,
Section 1-(d) as applicable to those getting employment thereafter. However, while
the trial Judge ruled that the aforequoted pertinent provision of the collective
bargaining agreement does not prescribe the period within which the employees must
remain as members of good standing of the union, and therefore the dismissal of the
complainants after they were expelled from the union was unjustified, the court en
banc ruled that the word "employ" as used in the proviso ("to have in its employ and
to employ only members in good standing of the union" means "to retain in service",
"to suffer or permit to work", "to keep at work". In short, the court en banc would
read in the provision the employer's assent to retain in the service or to keep at work
only those union members of good standing. We incline to uphold the stand of the
trial judge.
In one case,2 this Court ruled that a proviso in the collective bargaining contract
which reads:
That the UNION shall have the exclusive right and privilege to supply the
COMPANY with such laborers, employees and workers as are necessary in
the logging, mechanical, etc. ... and that the COMPANY agrees to employ
or hire in any of its departments only such person or persons who are
members of the UNION.
does not establish a "closed-shop" agreement, Thus, we held:
Inasmuch as Article II above quoted does not provide that employees "must
continue to remain members in good standing" of respondent union
"to keep their jobs," the collective bargaining agreement between them does
not establish a "closed shop," except in a very limited sense, namely, that
the laborers' employees and workers engaged by the company after the
signing of the agreement on January 23, 1955, must be members of
respondent union. The agreement does not affect the right of the company to
retain those already working therefor on or before said date, or those hired,
or employed subsequently thereto, while they were members of respondent
union, but who, thereafter, resign or are expelled therefrom.
In order that an employer may be deemed bound, under a collective
bargaining agreement, to dismiss employees for non-union membership, the
 stipulation to this effect must be so clear and unequivocal as to leave no
room for doubt thereon. An undertaking of this nature is so harsh that it
must be strictly construed, and doubts must be resolved against the
existence of "closed shop." Referring particularly to the abovequoted Article
II, we note that the same establishes the exclusive right of respondent union
to "supply" laborers, etc., and limits the authority of the company to
"employ or hire" them. In other words, it requires that the laborers,
employees and workers hired or employed by the company be members of
respondent union at the time of the commencement of the employer-
employee relation. Membership in respondent union is not a condition for
the continuation of said relation or for the retention of a laborer or Republic of the Philippines
employee engaged either before said agreement or while he was a member SUPREME COURT
of said union. Manila

There being no substantial difference between the wording of the provision involved FIRST DIVISION
in this case and that construed in the aforementioned case, we find no reason for the
adoption of a different ruling herein. G.R. No. L-27079 August 31, 1977

For the foregoing reason, the resolution of the respondent Court en banc is hereby set MANILA CORDAGE COMPANY, petitioner,
aside. Respondents Company and union are declared guilty of unfair labor practice vs.
as charged, and they are ordered to reinstate the complainants, and pay jointly and THE COURT OF INDUSTRIAL RELATIONS AND MANILA CORDAGE
severally, their back wages from the date of their dismissal until they are reinstated WORKERS UNION, respondents.
by the respondent Company minus whatever they may have earned elsewhere during
the period of their dismissal. Without costs. So ordered. G.R. No. L-27080 August 31, 1977

Concepcion, C.J., Reyes, J.B.L., Dizon, Regala, Bengzon, J.P., Zaldivar and Castro, MANCO LABOR UNION (NLU), petitioner,
concur.
Makalintal, J., took no part. vs.

MANILA CORDAGE WORKERS UNION and THE COURT OF

INDUSTRIAL RELATIONS, respondents.

G.R. No. L-27080 August 31, 1977

MANCI LABOR UNION (NLU), petitioner,

vs.
MANILA CORDAGE WORKERS UNION and THE COURT OF
INDUSTRIAL RELATIONS, respondents.

9
Sycip, Salazar, Luna & Associates for petitioner Manila Cordage Company.
Eulogio R. Lerum for petitioner Manco Labor Union (NLU)
B. C. Pineda & Associates for private respondent.
FERNANDEZ, J.:
These are petitions to review the decision dated May 4, 1966 1 and the resolution
dated October 19, 1966 2 of the respondent Court of Industrial Relations (CIR) in
Case No. 2728-ULP entitled "Manila Cordage Workers Union, complainant, vs.
Manila Cordage Company and Manco Labor Union, respondents."
The dispositive part of the decision reads:
FOREGOING PREMISES CONSIDERED, this Court finds
substantial evidence to sustain the charge of unfair labor practice
against respondent Manila Cordage Company in violation of
Section 4(a), paragraphs 1, 2 and 4 of the Industrial Peace Act, and
against respondent Manco Labor Union in violation of Section
4(b), paragraphs 1 and 2 of the same Act and, therefore, orders
both respondents their officials or agents:
1. To cease and desist from restraining and coersing complainants
in the exercise of their rights guaranteed by Section 3 of Republic
Act No. 875;
2. To cease and desist from further committing the unfair labor
practice complained of; and
3. To reinstate complainants Silvino Rabago, Natalio Nisperos and
Ricardo Trajano to their former positions and with all the rights
and privileges formerly appertaining thereto and to pay jointly and
salary their back wages from the time of their respective dismissal
on January 27, 1961, February 3, 1961, and May 2, 1961 up to the
10
date of their actual re-instatements, minus their earnings elsewhere,
if any.
To facilitate the payment of back wages due the complainants, the
Chief of the Examining Division of this Court and/or his duly
authorized assistant is hereby directed to examine the payrolls,
daily time records and other pertinent documents relative to
complainants services with respondent company and to submit the
corresponding report and computation for further disposition.
SO ORDERED.
Manila, Philippines, May 4, 1966.
AMANDO C. BUGAYONG Associate Judge 3
The resolution dated October 19, 1966 denied the two (2) separate motions filed by
Manila Cordage Company and Manco Labor Union for the reconsideration of the
decision dated May 4,1966.
On February 1, 1967 the petitioner Manco Labor Union filed the following Motion
in G.R. No. L-27080 (Manco Labor Union [NLU] vs. Manila Cordage Workers
Union, et al.):
MOTION TO CONSOLIDATE THIS CASE WITH G.R. NO. L-
27079 AND TO ADOPT THE PETITION THEREIN AS THE
PETITION IN THIS CASE
Comes now the petitioner Manco Labor Union NLU by the
undersigned attorney, and to this Honorable Court, respectfully
states:
That in Case No. 2728-ULP of the Court of Industrial Relations.
entitled "Manila Cordage Company and Manco Labor Union NLU
respondents", said Court rendered its Decision and Resolution on
May 4, 1966 and October 19, 1966, respectively, against the
respondents;
That the Manila Cordage Company had appealed said Decision
and Resolution in Case No. 2728-ULP before this Honorable Court
by certiorari and in the resolution of this Court dated January 23,
1967, in G.R. No. L-27079 (Manila Cordage Company vs. The
Court of Industrial Relations, et al.), the same was given due
course by this Court.
That since the issues to be brought by the herein petitioner in this
case are similar to the issues raised in the petition for certiorari in
G.R. No. L-27079, in order to avoid a multiplicity of cases, it is
desirable that the present case be consolidated with the said case;
That in order to avoid repetitions and a voluminous record, herein
petitioner is adopting the petition for review filed in G.R. No. L-
Z7079 as its own in the present case, and by reference, is made a
part hereof;
That this motion is timely because copy of the resolution of the
Court of Industrial Relations in this case was received on January
6, 1967, notice of appeal and a petition for extension for 15 days
was filed with this Court on January 16, 1967, which was granted,
and today is the last day for the filing of our petition for review in
this case.
WHEREFORE, it is respectfully prayed of this Honorable Court:
1. That the present case be consolidated with G.R. No. L- 27079,
entitled "Manila Cordage Company vs. The Court of Industrial
Relations and Manila Cordage Workers Union;
2. That herein petitioner be allowed to adopt the petition for review
in G.R. No. L-27079 as its own, and by reference made a part
hereof;
3. That upon notice in accordance with the Rules of this Court,
herein petitioner will deposit the amount of P80.40 in payment of
costs.
11
4. That in case this motion will be denied, that herein petitioner be
given five (15) days from notice to file its own petition for review.
Manila, January 31, 1967.
EULOGIO R. LERUM
Attorney for Petitioner
Manco Labor Union (NLU)
3199 Magsaysay Blvd., Manila
The Court issued on February 15, 1967 the following resolution:
Considering the motion of attorney for petitioner in L-27080
(Manco Labor Union [NLU] vs. Manila Cordage Workers Union,
et al.) praying (a) that this case be consolidated with L-27079
(Manila cordage Company vs. The Court of Industrial Relations, et
al. (b) that petitioner be allowed to adopt the petition for review in
aforesaid case L-27079 as its own, and by reference made a part
thereof; (c) that upon notice in accordance with the Rules of Court,
petitioner will deposit the amount of P80.40 for costs; and (d) in
case the motion is denied, petitioner be given five days from notice
to file its own petition for review THE COURT RESOLVED to
grant the first three prayers of the motion, provided that docket and
other fees are paid.
Very truly yours,
BIENVENIDO EJERCITO
Clerk of Court
On October 24, 1967 the petitioner Manco Labor Union submitted the following
motion:
MOTION TO ADOPT THE BRIEF OF
PETITIONER MANILA CORDAGE CO.
Comes now the petitioner Manco Labor Union NLU by the
undersigned attorney, and to this Honorable Court, respectfully
moves that in view of the fact that said Union could not afford the
printing of its brief due to poor finances, that it be allowed to adopt
as its own, the brief of the Manila Cordage Co.
That in addition to the arguments contained in said brief, this
petitioner would like to emphasize the following:
1. That complainants in the Court below, namely, Silvino Rabago,
Natalio Nisperos and Ricardo Trajano, by resigning from the
Manco Labor Union NLU violated the provision of the collective
bargaining agreement then in force, which reads as follows: IV
MAINTENANCE OF MEMBERSHIP
'Both parties agree that all employees of the
COMPANY who are already members of the
UNION at the time of the signing of this
AGREEMENT shall continue to remain
members of the UNION for the duration of this
AGREEMENT' (Exhibits '5-B' and '6- B'
Company).
Having violated said agreement, these complainants are liable to
dismissal in the same manner as strikers who violate a no strike
clause in a contract could be dismissed although said contract is
silent regarding the penalty for breach thereof.
Hence, the Manco Labor Union NLU should not be the one
penalized for its effort to secure compliance with the terms of its
central with petitioning company,
2. That said agreement could not be susceptible of any other
interpretation except that violation thereof would result in
dismissal because as found out by the Court below, the said
12
provision was explained to the members before and after the same
was signed.
3. Petitioner Manco Labor Union (NLU) could not be held guilty
of discriminating against Rabago, Nisperos and Trajano because of
heir union activities, The record shows that besides these three,
Vicente Untalan Ruperto Balsams and 40 others resigned. In the
case of Untalan and Balsamo after the Manila Cordage Co. had
dismissed them on request of the petitioning Union, this Union was
also the one who asked for their reinstatement when they withdrew
their resignation from the union, In the case of the other 40
members who resigned (Exhs. 'A', A-l to 'A-49') when they
withdrew their resignations, the Manco Labor Union did not do
anything to them, although it had full knowledge that they have
joined the rival union.
WHEREFORE, considering that Silvino Rabago, Natalio Nisperos
and Ricardo Traiano had violated the Collective Bargaining
Agreement whereas the action of the petitioner was one in good
faith in what it believes to be its right under said contract, we
respectfully pray of this Honorable Court that the decision
appealed from be set aside and case No. 2728-ULP of the Court of
Industrial Relations be ordered dismissed.
Manila, October 24, 1967.
EULOGIO R. LERUM
Attorney for the Petitioner
3199 Magsaysay Blvd., Manila
The petitioner, Manila Cordage Company, is a corporation duly organized and
existing under the laws of the Philippines.
The petitioner, Manco Labor Union, is a legitimate labor organization.
The respondent, Manila Cordage Workers Union, is also a legitimate labor
organization. Said respondent union is composed of employees of the petitioner
company.
Sometime in 1957, the Manila Cordage Company and the Manco Labor Union, then
acting as the exclusive bargaining representative of the former's employees, entered
into a collective bargaining agreement which contained, among others, the following
stipulations:
WHEREAS, the parties hereto decided to enter into an agreement
relating to the terms and conditions of employment, with reference
to those members to whom the provisions of this agreement
applies.
xxx xxx xxx
Both parties agree that all employees of the COMPANY who are
already members of the UNION at the time of the signing of this
AGREEMENT shall continue to remain members of the UNION
for the duration of this AGREEMENT. 4
The foregoing stipulations were also embodied in the collective bargaining
agreement entered into between the Manila Cordage Company and the Manco Labor
Union in 1959.
When the collective bargaining agreements were entered into, the employees. Silvino
Rabago, Ricardo Trajano and Natalio Nisperos were already members of Manco
Labor Union.
Shortly after 1959, some employees of Manila Cordage Company formed the Manila
Cordage Workers Union. The usual campaign for membership of the new union took
place. Some employees who were members of the Manco Labor Union resigned
from said union and joined the Manila Cordage Workers Union. At the instance of
the Manco Labor Union, the Manila Cordage Company dismissed those who
resigned from the Manco Labor Union, among them, Silvino Rabago, Vicente
Untalan, Ruperto Balsamo, Natalio Nisperos, Ricardo Traiano, Roque Ruby and
Salvador de Leon. It is alleged that the Manco Labor Union held meetings wherein
the members were informed that under the above-quoted stipulations of the
13
collective bargaining agreement, continued membership in the Manco Labor Union
was a condition precedent to employment in the Manila Cordage Company. As a
consequence, some of those who resigned from the Manco Labor Union withdrew
their resignations and were re-employed by the Manila Cordage Company.
At the behest of the Manila Cordage Workers Union, an acting prosecutor of the
Court of Industrial Relations filed a complaint dated March 28, 1961 for unfair labor
practice against Manila Cordage Company and the Manco Labor Union in behalf of
the Manila Cordage Workers Union and its members namely, Silvino Rabago,
Vicente Untalan Ruperto Balsams rid Natalio Nisperos The complaint was docketed
as Case No. Z728-ULP of the Court of Industrial Relations. 5
The acting prosecutor of the Court of Industrial Relations filed an amended
complaint in Case No. 2728-ULP dated July 14, 1961 adding as complainants
Ricardo Trajano and Salvador de Leon. 6
It was alleged in the amended complaint that the Manco Labor Union, through its
President, for no other valid cause except for the resignation of some of its members
and the active campaign of the Manila Cordage Workers Union in recruiting
members, knowingly and unlawfully influenced and connived with officers of the
Manila Cordage Company in the dismissal of Silvino Rabago, Vicente Untalan
Ruperto Balsams Natalio Nisperos Ricardo Trajano and Salvador de Leon, who had
resigned from the Manco Labor Union and joined the Manila Cordage Workers
Union.
The Manco Labor Union averred in its answer that the complainants were dismissed
on the basis of an existing collective bargaining contract between said union and the
Manila Cordage Company. 7
The Manila Cordage Company alleged that said company had entered into a valid
collective bargaining contract with the Manco Labor Union, a bona fide legitimate
labor organization, then recognized as the sole and exclusive bargaining agent for all
the employees of the respondent company; that one of the conditions of employment
provided in said collective bargaining agreement is the maintenance-of-membership
clause requiring all members of the Manco Labor Union to remain as such members
thereof during the life of the contract; that the Manco Labor Union demanded of the
Manila Cordage Company the dismissal of the individual complainants from
employment for the reason that said complainants had failed to continue and
maintain their membership in the union; that acting in good faith and in pursuance of THE LOWER COURT ERRED IN NOT HOLDING THAT
its obligations under the said contract, respondent company had to terminate the INDIVIDUALS, WHOSE EMPLOYMENT HAS CEASED DUE
employment of said complainants, otherwise the Manila Cordage Company would be TO ALLEGED UNFAIR LABOR PRACTICES AND WHO
charged with contractual breach and confronted with the Manco Labor Union's HAVE NOT SOUGHT OTHER SUBSTANTIALLY
reprisal. 8 EQUIVALENT AND REGULAR EMPLOYMENT, CEASE TO
BE 'EMPLOYEES' WITHIN THE MEANING OF SECTION 2 (d)
After trial the respondent Court of Industrial Relations rendered a decision dated OF REPUBLIC ACT NO. 875, AS AMENDED, AND HENCE,
May 4, 1966 ordering the petitioner, Cordage Company, and the Manco Labor Union ARE NOT ENTITLED TO PROTECTION AND RELIEF
"To reinstate complainants Silvino Rabago, Natalio Nisperos and Ricardo Trajano to UNDER This ACT.
their former positions and with all the rights and privileges formerly appertaining
thereto and to pay jointly and severally their back wages from the time of their III
respective dismissals on January 27, 1961, February 3, 1961, and May 2, 1961 tip to
the date of their actual reinstatements, minus their hearings elsewhere, if any. 9 THE LOWER COURT ERRED IN NOT HOLDING THAT
INDIVIDUALS DISMISSED PURSUANT TO A UNION
The motions for reconsideration of the Manila Cordage Company and the Manco SECURITY CLAUSE ARE NOT ENTITLED TO BACK
Labor Union were denied by the Court of Industrial Relations in a resolution en banc WAGES, WHEN THEIR EMPLOYER EFFECTED THEIR
dated October 19, 1966. 10 However, the Presiding Judge voted for the modification DISMISSAL IN GOOD FAITH AND IN AN HONEST BELIEF
of the decision dated May 4, 1966 by eliminating therefrom the award of back THAT THE CLAUSE AUTHORIZED SUCH DISMISSAL.
wages. He concurred in the reinstatement of complainants Nisperos Trajano and
Rabago. 11 IV

The petitioner Manila Cordage Company assigns the following errors: THE LOWER COURT ERRED IN NOT DISMISSING THE
COMPLAINT. 12
I
Anent the first error assigned, the petitioner avers:
THE LOWER COURT ERRED IN NOT HOLDING THAT,
UNDER THE MAINTENANCE-OF-MEMBERSHIP' CLAUSE It should be emphasized strongly that this is virtually a case of first
IN THE COLLECTIVE BARGAINING AGREEMENT impression in this jurisdiction, We are not aware of any decision of
BETWEEN THE PETITIONER ('COMPANY') AND MANCO this Tribunal squarely determinative of the principal issue in this
LABOR UNION MANCO EMPLOYEES OF THE COMPANY petition. For this reason, it should be appropriate to consider
WHO ARE ALREADY MEMBERS OF MANCO WHEN SAID American jurisprudence which is the source of most of our law on
AGREEMENT TOOK EFFECT WERE REQUIRED TO labor relations. (Flores vs. San Pedro, L-8580, September 30,
REMAIN SUCH MEMBERS AS A CONDITION OF 1957.)
CONTINUED EMPLOYMENT IN THE COMPANY.
Decisions of American federal and state courts as well as the
II comments of recognized American treatise writers uniformly
define a maintenance-of-membership provision as one which
requires all employees who are already members of the union at

14
 the time the provision takes effect to remain such members during
the life thereof -is a condition of continued employment. (NLRB
vs. Eaton Mfg. Co. [6th Cir. 1949]175 F2d 292, 16 Lab Cas 75,
761; Markham & Callow vs. International Woodworkers, 175 P2d
727, 170 or 517 [1943]; Walter vs. State, 38 Sold 609, 34 AlaApp
268 [1949]; Colonial Press vs. Ellis 74 NE2d 1, 321 Mass 495;
Rothenberg on Labor Relations, 49-50; Mathews Labor Relations
and the Law 448; Prentice-Hall Labor Course, Par. 12, 204, also at
914; 3 CCH Labor Law Reporter [Labor Relations], Pat. 4520. ) 13
It is not necessary to consider American jurisprudence. The issue of whether or not
the so-called "maintenance-of membership" clause requires all employees who were
already members of the Manco Labor Union at the time the said clause took effect to
remain members of the union during the life of the collection bargaining agreement
as a condition of continued employment may be resolved under the constitution and
relevant Philippine jurisprudence.
It is a fact that the complainants were employees of the Manila Cordage Company
and members of the Manco Labor Union when the following stipulation was
included in the collective bargaining agreement:
IV MAINTENANCE OF MEMBERSHIP
Both parties agree that all employees of the COMPANY who are
already members of the UNION at the time of the signing of this
AGREEMENT shall continue to remain members of the UNION
for the duration- of this AGREEMENT" (Exhibits '5-B' and '6-B'
Company ). 14
The foregoing stipulation, however, does not clearly state that maintenance of
membership in the Manco Labor Union is a condition of continuous employment in
the Manila Labor Cordage Company.
In consonance with the ruling in Confederated Sons of Labor vs. Anakan Lumber
Co., et al., 107 Phil. 915, in order that the Manila Cordage Company may be deemed
bound to dismiss employees who do not maintain their membership in the Manco
Labor Union, the stipulation to this effect must be so clear as to leave no room for
15
doubt thereon An undertaking of this nature is so harsh that it must be strictly
construed and doubts must be resolved against the existence of the right to dismiss.
Apparently aware of the deficiency of the maintenance- of membership clause, the
petitioner urges that the same should be construed together with the "Whereas"
provision of the contract which reads:
WHEREAS, the parties hereto nave decided to enter into an
agreement relating to the terms and conditions of employment and
reference to those employees to whom 7 the provisions of this
AGREEMENT apply." (Exhibits '5-A' and '?-A-Company) 15
Anent this point, the Court of Industrial Relations through 'Judge Amando Bugayong
ruled:
But whether read disjunctively or conjunctively, these two
provisions would not justify the interpretation which respondent
company would want to attribute to the same. For said whereas'
proviso neither refers to tenure of duration of employment which is
tile issue in the case at bar but only to terms and conditions of
employment such as working hours. wages, other benefits and
privileges clearly specified therein. We need not stretch our
imagination too far to know the difference between or duration of
employment from terms and conditions of employment. Besides
even on the assumption that 'terms and conditions of employment'
covers continuity or period of employment, the ambiguity of the
provision should not adversely affect complainants. Hence, even
with the conjuctive interpretation, these two provisions can not
supplant the omission of and said maintenance of membership
clause, let alone cure the act of the same This is especially so if the
rule which states that in case of inconsistency a particular
provision like the disputed maintenance of membership clause
prevails over or controls a general provision, such as 'WHEREAS'
proviso, invoked by respondents, is to be applied to the
interpretation of this doubtful provision (Rule 130(4), Section 10,
New Rules of Court). 16
To construe the stipulations above-quoted as imposing as a condition to continued
employment in the Manila Cordage Company the maintenance of membership in the
Manco Labor Union is to violate the natural and constitutional right of the laborer to
organize freely. 17 Such interpretation would be inconsistent with the constitutional
mandate that the State shall afford protection to labor. 18
The respondent Court of Industrial Relations correctly found that the disputed
"maintenance-of-membership" clause in question did not give the Manila Cordage
Company the right to dismiss just because they resigned as members of the Manco
Labor Union.
There is a showing that the dismissed complainants sought our substantially
equivalent and regular employment. They failed to find any.
The contention n of the petitioners that they acted in good faith in dismissing the
complainants and, therefore, should not be field liable to pay their back wages has no
merit. The dismissal of the complainants by the petitioners was precipitate and done
with undue haste. Considering that the so-called "maintenance to membership' clause
did it clearly the petitioners the right to dismiss the complainants if said
complainants did not maintain their membership in the Manco Labor Union, the
petitioners should have raised the issue before the Court of Industrial Relations in a
petition for permission to dismiss the complainants.
However, considering the circumstances and equity of the case, the petitioners
should be held liable to pay the back wages of the complainants for a period of two
years only from the date they were respectively dismissed. 19
The reinstatement order of respondent Court of Industrial Relations of complainants
Silvino Rabago, Natalio Nisperos and Ricardo Trajano to their former positions and
with all the rights arid privileges formerly appertaining thereto is correct (supra, p.
2). Such reinstatement now is of course subject to said complainants still being
within the required physical and age requirements, but any physical or medical
examination to which they may be subjected is to be given them as old reinstated
workers, but not as a precondition to their reinstatement. Our ruling in Davao Free
Workers Front vs. CIR, 60 SCRA 408, 425, is fully applicable mutatis mutandis in
the case at bar as follows:
16
... The filing and pendency of an unfair labor practice case as in the
case at bar presupposes a continuing employer-employee
relationship and when the case is decided in favor of the workers,
this relationship is in law deemed to have continued
uninterruptedly notwithstanding their unlawful dismissal or the
lawful strike and stoppage of work, and hence, seniority and other
privileges are preserved in their favor, To require them to undergo
a physical or medical examination ad a precondition of
reinstatement or return to work simply because of the long
pendency of their case which is due to no fault of theirs would not
only defeat the purpose of the law and the constitutional and
statutory mandates to protect labor but would work to their unfair
prejudice as aggrieved parties and give an undue advantage to
employers as the offenders who have the means and resources to
wage attrition and withstand the bane of protracted litigation.
Hence, the aggrieved workers may be subjected to periodic
physical or medical examination as old reinstated workers, but not
as a precondition to their reinstatement or return to work with the
important consequence that if they are found to be ill or suffering
from some disability, they would be entitled to all the benefits that
the laws and company practices provide by way of compensation,
medical care, disability benefits and gratuities. etc. to employees
and workers.
WHEREFORE, the decision appealed from is hereby affirmed with the sole
modification that the backwages which both the petitioners are ordered, jointly and
severally, to pay the complainants Silvino Rabago, Natalio Nisperos and Ricardo
Trajano are hereby fixed at the equivalent of two years pay without deduction or
qualification computed on the basis of their wages at the time of their respective
dismissals on January 27, 1961, February 3, 1961 and May 2, 1961. Without
pronouncement as to costs.
 VALENTIN GUIJARNO, HERMINIGILDO DE JUAN, NICOLAS
CASUMPANG, ELEUTERIO BOBLO, BENITO GUAVEZ, ARSENIO
JEMENA, DIMAS BOCBOCILA, NICOLAS ALAMON, ISMAEL
BILLONES, RAYMUNDO ALAMON, SANTIAGO BAES, SOFRONIO
CONCLARA, ADRIANO BIAS, AURELIO ALAMON, SIMEON BERNIL,
RESURRECION DIAZ, FELICIANO BELGIRA, FEDERICO BOSQUE, and
AGOSTO PULMONES, petitioners,
vs.
COURT OF INDUSTRIAL RELATIONS, CENTRAL SANTOS LOPEZ CO.,
INC. and UNITED SUGAR WORKERS UNION-ILO respondents.

Pedrito A. Gianzon for petitioners.

Luis H. Garganera for private respondents.

FERNANDO, J.:

The failure of respondent Court of Industrial Relations to order the reinstatement of

petitioners to their employment gave rise to this appeal by way of certiorari. The
need for resort to this Court could have been obviated had there been no such marked
inattention to the authoritative principle that a closed-shop provision of a collective
bargaining contract is not to be applied retroactively for, at the time the decision was
rendered on November 2, 1967 and its affirmance by a resolution of respondent
Court en banc on January 22, 1968, such a doctrine was controlling and did call for
application. So it was indicated in the leading case of Confederated Sons of Labor v.
Anakan Lumber and Co., 1 a 1960 decision. As a matter of law then, the stand of
petitioners is well-nigh impregnable. It would follow that their appeal must be
Republic of the Philippines sustained and respondent Court must be reversed.
SUPREME COURT
Manila Three unfair labor practice cases for unlawful dismissal allegedly based on legitimate
union activity were filed against respondent Central Santos Lopez Co., Inc. and
EN BANC respondent United Sugar Workers Union-ILO, with eight of the present petitioners as
complainants in the first, 2 six of them in the second, 3 and five, in the third.4 There
was a consolidated hearing and a consolidated decision not only for convenience, but
also due to there being hardly any difference as to the nature of the alleged grievance
G.R. Nos. L-28791-93 August 27, 1973 and the defense of management. There was no question about the expulsion from

17
respondent labor union of the former. In view of a closed-shop provision in the then
existing collective bargaining contract, respondent Central Santos Lopez Co., Inc.
assumed it had to dismiss them. So it was noted in the decision of the then associate
Judge Joaquin M. Salvador of respondent Court. Thus: "The respondent company, in
its answer, alleged that the only reason for the dismissal of the complainants herein is
because their said dismissal was asked by the USWU-ILO of which union
respondent company has a valid and existing collective bargaining contract with a
closed-shop provision to the effect that those laborers who are no longer members of
good standing in the union may be dismissed by the respondent company if their
dismissal is sought by the union; that respondent company has never committed acts
of unfair labor practice against its employees or workers much less against the
complainants herein but that it has a solemn obligation to comply with the terms and
conditions of the contract; and that a closed-shop agreement is sanctioned under this
jurisdiction for such kind of agreement is expressly allowed under the provisions of
Republic Act 875 known as the Industrial Peace Act and the dismissal of
complainants is merely an exercise of a right allowed by said law." 5 There was no
question, however, as to petitioners having been employed by such respondent
Company long before the collective bargaining contract, the first instance noted
being that of Resurrecion Diaz, who was in the service as far back as
1928; 6 Santiago Baez, as far back as 1929; 7 Dimas Bocbocila, as far back as
1933; 8 Simeon Bernil, as far back as 1935; 9 Aurelio Alamon, as far back as
1936; 10 Valentin Guijarno, as far back as 1937; 11 Benito Guavez, as far back as
1938; 12Raymundo Alamon, as far back as 1939; 13 Eleuterio Boblo, Nicolas Alamon,
Sofronio Conclara, Adriano Bias and Federico Bosque, as far back as
1947; 14 Herminigildo de Juan and Nicolas Casumpang, as far back as
1948; 15 Agosto Pulmones, as far back as 1949; 16 and Feliciano Belgira, as far back
as 1954. 17
In the decision of respondent Court, there was an acknowledgment of the prior
existence of such employment relationship. Nonetheless, the conclusion reached,
both by the trial judge and then by respondent Court en banc was that the dismissal
was justifiable under the closed-shop provision of the collective bargaining
agreement. Hence, this petition for review, which, as noted at the outset, is impressed
with merit.
1. The authoritative doctrine that a closed-shop provision in a collective bargaining
agreement is not to be given a retroactive effect so as to preclude its being applied to
employees already in the service, is traceable, as set forth in the opening paragraph
18
of this opinion, to the leading case of Confederated Sons of Labor v. Anakan Lumber
Co. 18 decided in April of 1960. In discussing the particular stipulation in the
contract, it was made clear in the opinion of the then Justice, later Chief Justice,
Concepcion: "In order that an employer may be deemed bound, under a collective
bargaining agreement, to dismiss employees for non-union membership, the
stipulation to this effect must be so clear and unequivocal as to leave no room for
doubt thereon. An undertaking of this nature is so harsh that it must be strictly
construed, and doubts must be resolved against the existence of "closed
shop"." 19 Less than a year later, to be more precise, on January 28, 1961, in Freeman
Shirt Manufacturing Co., Inc. v. Court of Industrial Relations, 20 this Court, speaking
through Justice Gutierrez David, went further. Thus: "The closed-shop agreement
authorized under sec. 4, subsec. a(4) of the Industrial Peace Act above quoted should
however, apply to persons to be hired or to employees who are not yet members of
any labor organization. It is inapplicable to those already in the service who are
members of another union. To hold otherwise, i. e., that the employees in a company
who are members of a minority union may be compelled to disaffiliate from their
union and join the majority or contracting union, would render nugatory the right of
all employees to self-organization and to form, join or assist labor organizations of
their own choosing, a right guaranteed by the Industrial Peace Act (sec. 3, Rep. Act
No. 875) as well as by the Constitution (Art. III, sec. 1[6])." 21 Thereafter,
in Kapisanan Ng Mga Mangagagawa Ng Alak v. Hamilton Distillery
Company, 22 this Court, again speaking through the former, minced no words in
characterizing a stipulation that would allow a dismissal of those already employed
as "null and void." 23 In 1967, this time already elevated to his position as head of the
Court, Chief Justice Concepcion in Salunga v. Court of Industrial Relations 24 did
stress that while "generally, a state may not compel ordinary voluntary associations
to admit thereto any given individual, because membership therein may be accorded
or withheld as a matter of privilege, the rule is qualified in respect of labor unions
holding a monopoly in the supply of labor, either in a given locality, or as regards a
particular employer with which it has a closed-shop agreement. ... ." 25 He continued:
"Consequently, it is well settled that such unions are not entitled
to arbitrarily exclude qualified applicants for membership, and a closed-shop
provision would not justify the employer in discharging, or a union in insisting upon
the discharge of, an employee whom the union thus refuses to admit to membership,
without any reasonable ground therefor. Needless to say, if said unions may be
compelled to admit new members, who have the requisite qualifications, with more
reason may the law and the courts exercise the coercive power when the employee
involved is a long standing union member, who, owing to provocations of union
officers, was impelled to tender his resignation, which he forthwith withdrew or
revoked. Surely, he may, at least, invoke the rights of those who seek admission for
the first time, and can not arbitrarily be denied re-admission." 26
Nothing can be clearer therefore than that this Court looks with disfavor on a
provision of this character being utilized as an excuse for the termination of
employment. To complete the picture, mention should be made of Elegance, Inc. v.
Court of Industrial Relations, 27 where this Court, through the present Acting Chief
Justice Makalintal, harked back to Freeman Shirt Manufacturing Co., Inc. v. Court
of Industrial Relations 28 to stress the point of non-retroactivity. What should be
immediately apparent, but unfortunately respondent Court seemed to have closed its
eyes to it, is that when the decision was rendered by the trial judge on November 2,
1967 and affirmed with the Court sitting en banc on January 22, 1968, the
controlling doctrine to which deference ought to have been paid was that petitioners
should not have been dismissed.
2. Nor is there anything unusual in this Court's adherence with remarkable
consistency to such a basic doctrine. The obligation was categorically imposed on
the State, under the 1935 Constitution, to "afford protection to labor, especially to
working women and minors ... ." 29 That is to carry out the purpose implicit in one of
the five declared principles, namely, the promotion of social justice "to insure the
well-being and economic security of all the people ... ." 30 It is then the individual
employee, as a separate, finite human being, with his problems and his needs, who
must be attended to. He is the beneficiary of the concern thus made manifest by the
fundamental law. The present Constitution is even more explicit on the matter. The
principle that the State shall promote social justice is categorically based on the
concept of insuring "the dignity, welfare, and security of all the people." 31 Insofar as
the provision on the State affording protection to labor is concerned, it is further
required to "promote full employment and equality in employment, ensure equal
work opportunities regardless of sex, race, or creed, and regulate the relations
between workers and employers. The State shall assure the rights of workers to self-
organization, collective bargaining, security of tenure, and just and humane
conditions of work." 32 Where does that leave a labor union, it may be asked.
Correctly understood, it is nothing but the means of assuring that such fundamental
objectives would be achieved. It is the instrumentality through which an individual
laborer who is helpless as against a powerful employer may, through concerted effort
and activity, achieve the goal of economic well-being. That is the philosophy
underlying the Industrial Peace Act. 33 For, rightly has it been said that workers
unorganized are weak; workers organized are strong. Necessarily then, they join
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labor unions. To further increase the effectiveness of such organizations, a closed-
shop has been allowed. 34 It could happen, though, that such a stipulation which
assures further weight to a labor union at the bargaining table could be utilized
against minority groups or individual members thereof. There are indications that
such a deplorable situation did so manifest itself here. Respondent Court, it would
appear, was not sufficiently alert to such a danger. What is worse, it paid no heed to
the controlling doctrine which is merely a recognition of a basic fact in life, namely,
that power in a collectivity could be the means of crushing opposition and stifling the
voices of those who are in dissent. The right to join others of like persuasion is
indeed valuable. An individual by himself may feel inadequate to meet the
exigencies of life or even to express his personality without the right to association
being vitalized. It could happen though that whatever group may be in control of the
organization may simply ignore his most-cherished desires and treat him as if he
counts for naught. The antagonism between him and the group becomes marked.
Dissatisfaction if given expression may be labeled disloyalty. In the labor field, the
union under such circumstances may no longer be a haven of refuge, but indeed as
much of a potential foe as management itself. Precisely with the Anakan doctrine,
such an undesirable eventuality has been sought to be minimized, if not entirely
avoided. There is no justification then, both as a matter of precedent and as a matter
of principle, for the decision reached by respondent Court.
3. Now as to the remedy to which petitioners are entitled. Clearly, they should be
reinstated with back pay. In Salunga v. Court of Industrial Relations, 35 reinstatement
was ordered but it was the labor union that was held liable for the back wages. That
is a rule dictated by fairness because management, in this case respondent Central
Santos Lopez Company, Inc., would not have taken the action it did had it not been
for the insistence of the labor union seeking to give effect to its interpretation of a
closed-shop provision. As we decided then, so do we now. These words of the Chief
Justice in Salunga carry persuasion: "Just the same, having been denied re-admission
into the Union and having been dismissed from the service owing to an unfair labor
practice on the part of the Union, petitioner is entitled to reinstatement as member of
the Union and to his former or substantially equivalent position in the Company,
without prejudice to his seniority and/or rights and privileges, and with back pay,
which back pay shall be borne exclusively by the Union. In the exercise of its sound
judgment and discretion, the lower court may, however, take such measures as it may
deem best, including the power to authorize the Company to make deductions, for
petitioner's benefit, from the sums due to the Union, by way of check off or
otherwise, with a view to executing this decision, and, at the same time effectuating
the purposes of the Industrial Peace Act." 36
WHEREFORE, the decision of respondent Court of November 2, 1967 and the therefrom whatever wages they may have earned in the meanwhile. With costs
resolution of respondent Court en banc sustaining the same of January 2, 1968 are against private respondents.
hereby reversed. Respondent Central Lopez Co., Inc. is hereby ordered to reinstate
petitioners to the positions they occupied prior to their illegal dismissal, with back
wages to be paid by respondent United Sugar Workers Union-ILO, deducting

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