FIRST DIVISION
PHILIPPINE JOURNALISTS, G.R.
No. 166421
INC., BOBBY DELA CRUZ,
ATTY. RUBY RUIZ BRUNO,
Petitioners, Present:
PANGANIBAN,
C.J., Chairperson,
-
versus - YNARES-SANTIAGO,
AUSTRIA-MARTINEZ,
CALLEJO, SR., and
CHICO-NAZARIO,
JJ.
NATIONAL LABOR RELATIONS
COMMISSION, HON. COMMS.
GENILO and ERNESTO Promulgated:
VERCELES, JOURNAL
EMPLOYEES
THE COURT OF APPEALS,
Respondents.
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D E C I S I O N
CALLEJO, SR., J.:
This is a Petition for Certiorari under Rule 65[1] of
the Rules of Court of the Decision[2] of
the Court of Appeals (CA) in CA-G.R. SP No. 81544, as well as the Resolution[3]
dated
The Antecedents
The Philippine Journalists, Inc.
(PJI) is a domestic corporation engaged in the publication and sale of
newspapers and magazines. The exclusive bargaining agent of all the rank-and-file
employees in the company is the Journal Employees Union (
Sometime in April 2005, the P127.0 million.” The Secretary of the Department
of Labor and Employment (DOLE) certified[4]
the labor dispute to the National Labor Relations Commission (NLRC) for
compulsory arbitration pursuant to Article 263 (g) of the Labor Code. The case
was docketed as NCMB-NCR-NS-03-087-00.
The
parties were required to submit their respective position papers. PJI filed a
motion to dismiss, contending that the Secretary of Labor had no jurisdiction
to assume over the case and thus erred in certifying it to the Commission. The
NLRC denied the motion. PJI, thereafter, filed a Motion to Defer Further
Proceedings, alleging, among others, that the filing of its position paper
might jeopardize attempts to settle the matter extrajudicially, which the NLRC
also denied. The case was, thereafter, submitted for decision.[5]
In its Resolution[6]
dated
Thus, the NLRC declared that the
retrenchment of 31 employees was illegal and ordered their reinstatement “to
their former position without loss of seniority rights and other benefits, with
payment of unpaid salaries, bonuses and backwages from the date of dismissal up
to the actual date of reinstatement plus 10% of the total monetary award as
attorney’s fees.” PJI was adjudged liable in the total amount of P6,447,008.57.[7]
Thereafter, the parties executed a
Compromise Agreement[8] dated
July 9, 2001, where PJI undertook to reinstate the 31 complainant-employees effective
July 1, 2001 without loss of seniority rights and benefits; 17 of them who were
previously retrenched were agreed to be given full and complete payment of
their respective monetary claims, while 14 others would be paid their monetary
claims minus what they received by way of separation pay. The agreement stated that the parties entered
the agreement “[i]n a sincere effort at peace and reconciliation as well as to
jointly establish a new era in labor management relations marked by mutual
trust, cooperation and assistance, enhanced by open, constant and sincere
communication with a view of advancing the interest of both the company and its
employees.” The compromise agreement was submitted to the NLRC for approval. All
the employees mentioned in the agreement and in the NLRC Resolution affixed their
signatures thereon. They likewise signed the Joint Manifesto and Declaration of
Mutual Support and Cooperation[9] which
had also been submitted for the consideration of the labor tribunal.
The NLRC forthwith issued another Resolution[10] on
In the meantime, however, the
1. OUTRIGHT DISMISSAL OF 29 EMPLOYEES
2. VIOLATION OF CBA BENEFITS
3. NON-PAYMENT OF ALLOWANCES, MEAL, RICE, TRANSPORTATION, QUARTERLY BONUS, X-MAS BONUS, ANNIVERSARY BONUS, HEALTH INSURANCE, DENTAL TO 29 EMPLOYEES
4. NON-PAYMENT OF BACKWAGES OF 38 REINSTATED EMPLOYEES [JUNE 2001 SALARY AND ALLOWANCES, DIFFERENCE (sic) OF ALLOWANCES AND BONUSES AWARDED BY NLRC]
5. TRANSPORTATION ALLOWANCE OF 5 UNION MEMBERS
6.
NON-PAYMENT OF P1000 INCREASE PER CBA
7. DIMINUTION OF SALARY OF 200 EMPLOYEES TO 50%[12]
In an Order[13]
dated
The
In its Resolution[16]
dated
The NLRC also declared that by their
separate acts of entering into fixed-term employment contracts with petitioner
after their separation from employment by virtue of retrenchment, they are
deemed to have admitted the validity of their separation from employment and
are thus estopped from questioning it. Moreover, there was no showing that the
complainants were forced or pressured into signing the fixed-term employment
contracts which they entered into. Consequently, their claims for CBA benefits
and increases from January to November 2002 should be dismissed. The NLRC
pointed out that since they were mere contractual employees, the complainants were
necessarily excluded from the collective bargaining unit. The NLRC stressed
that the complainants had refused to be regularized and ceased to be employees
of petitioner upon the expiration of their last fixed-term employment
contracts. Thus, the NLRC dismissed the case for lack of merit, but directed
the company to “give preference to the separated 29 complainants should they
apply for re-employment.”
On the other issues raised by the
complainants, the NLRC held:
We, furthermore find that JEU has no personality to represent the 29 Complainants for, as prudently discussed above, they were contractual employees, not regular employees, from the time they entered into fixed-term employment contracts after being retrenched up to the time they ceased being employees of PJI due to the non-renewal of their last fixed-term employment contracts. As contractual employees, they were excluded from the Collective Bargaining Unit (Section 2, CBA) and hence, not union members.
Complainants contend that PJI admitted that the 29 Complainants were union members because PJI deducted union dues from their monthly wages.
We, however, do not subscribe to this view.
Firstly, although PJI deducted union dues from the monthly wages of the 29 employees, it erroneously did so due to the distracting misrepresentation of JEU that they were union members. Thus, if there is any legal effect of these acts of misrepresentation and erroneous deduction, it is certainly the liability of JEU for restitution of the erroneously deducted amounts to PJI.
Secondly, the union membership admission due to erroneous union dues deduction is incompatible with the fixed-term employment contracts Complainants entered into with PJI.
We finally rule that JEU is not guilty of unfair labor practice. Although it admitted the 29 contractual employees as its members and represented them in the instant case and circulated derogatory letters and made accusations against Respondents, it is, nevertheless, deemed to have acted in good faith, there being no substantial evidence on record showing that they did so in bad faith and with malice.
Much as we empathize with
Complainants in their period of depressing economic plight and hence, sincerely
yearn to extricate them from them such a situation, [w]e cannot do anything,
for our hands are shackled by the hard but true merits of the instant case. As
an exception to this incapacity, however, [w]e can request Respondents to give
preference to the 29 Complainants should they apply for re-employment.[17]
The
In its Decision dated
The CA further held that the act of
respondent in hiring the retrenched employees as contractual workers was a ploy
to circumvent the latter’s security of tenure. This is evidenced by the admission
of PJI, that it hired contractual employees (majority of whom were those
retrenched) because of increased, albeit uncertain, demand for its
publications. The CA pointed out that this was done almost immediately after
implementing the retrenchment program. Another “telling feature” is the fact
that the said employees were re-hired for five-month contracts only, and were
later offered regular employment with salaries lower than what they were
previously receiving. The CA also ruled that the dismissed employees were not
barred from pursuing their monetary claims despite the fact that they had
accepted their separation pay and signed their quitclaims. The dispositive
portion of the decision reads:
WHEREFORE,
the petition is GRANTED. Respondent
is ordered to reinstate the 29 dismissed employees to their previous positions
without loss of seniority rights and payment of their full backwages from the
time of their dismissal up to their actual reinstatement. Respondent is
likewise ordered to pay the 29 and 50 employees, respectively, their rightful
benefits under the
SO ORDERED.[18]
The Present Petition
PJI, its President Bobby Dela Cruz,
its Executive Vice-President Arnold Banares, and its Chief Legal Officer Ruby
Ruiz Bruno, the petitioners, now come before this Court and submit that the CA
erred as follows:
I
THE HONORABLE COURT
OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION WHEN IT ADOPTED THE RESOLUTION
DATED
COMPROMISE AGREEMENT
BETWEEN THE PARTIES IN
II
THE HONORABLE COURT
OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION WHEN IT TRIED FACTS
III
THE HONORABLE COURT
OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION WHEN IT GRANTED TO AWARD 50
OTHER PERSONS WHO
At the outset, we note that this case
was brought before us via petition for certiorari
under Rule 65 of the Revised Rules of Civil Procedure. The proper remedy,
however, was to file a petition under Rule 45. It must be stressed that certiorari under Rule 65 is “a remedy
narrow in scope and inflexible in character. It is not a general utility tool
in the legal workshop.”[20]
Moreover, the special civil action for certiorari
will lie only when a court has acted without or in excess of jurisdiction or
with grave abuse of discretion.[21]
Be that as it may, a petition for certiorari may be treated as a petition
for review under Rule 45. Such move is in accordance with the liberal spirit
pervading the Rules of Court and in the interest of substantial justice.[22] As
the instant petition was filed within the prescribed fifteen-day period, and in
view of the substantial issues raised, the Court resolves to give due course to
the petition and treat the same as a petition for review on certiorari.[23]
The primary issue before the Court is
whether an NLRC Resolution, which includes a pronouncement that the members of
a union had been illegally dismissed, is abandoned or rendered “moot and
academic” by a compromise agreement subsequently entered into between the
dismissed employees and the employer; this, in turn, raises the question of
whether such a compromise agreement constitutes res judicata to a new complaint later filed by other union
members-employees, not parties to the agreement, who likewise claim to have
been illegally dismissed.
Petitioners point out that a
compromise agreement is the product of free will and consent of the parties and
that such agreement can be entered into during any stage of the case. They
insist that its terms are not dictated or dependent on the court’s findings of
facts; it is valid as long as not contrary to law, public order, public policy,
morals or good customs. According to petitioners, the execution of the
compromise agreement embodied and approved by the NLRC Resolution dated
Petitioners also point out that as
correctly observed by the NLRC, the resolution declaring respondents’ retrenchment
was promulgated on
approved on
Petitioners claim that the letter of
Atty. Adolfo Romero dated
Petitioners further point out that
while the instant petition was filed only by 29 complainants, the dispositive
portion of the assailed decision was extended to cover 50 other persons. They
insist that the said letter, as well as the findings of a “mooted decision,”
were used as evidence to support the erroneous decision of the CA; in so doing,
the appellate court acted with grave abuse of discretion amounting to lack or
excess of jurisdiction.
For their part, private respondents claim
that the appellate court did not commit any reversible error, and that the
assailed decision is borne out by the evidence on record. Since the dismissal
of the retrenched employees has been declared illegal, the 29 dismissed
employees enjoy the status of regular and permanent employees who cannot be
dismissed except for cause; hence, the CA correctly ordered their
reinstatement.
They further point out that the fixing
of five-month contracts of employment entered into by the individual union
members was intentionally employed by petitioners to circumvent the provisions
of the Labor Code on security of tenure, hence, illegal. They also allege that petitioners
did not comply with the 30-day notice rule required by law to render any
dismissal from employment valid. The letter of dismissal was dated
The Ruling of the Court
The petition is denied.
The nature of a compromise is spelled
out in Article 2028 of the New Civil Code: it is “a contract whereby the
parties, by making reciprocal concessions, avoid litigation or put an end to
one already commenced.” Parties to a compromise are motivated by “the hope of
gaining, balanced by the dangers of losing.”[26] It
contemplates mutual concessions and mutual gains to avoid the expenses of
litigation, or, when litigation has already begun, to end it because of the
uncertainty of the result.[27] Article
227 of the Labor Code of the
held in Reformist Union of R.B. Liner, Inc. v. NLRC,[29] the
provision “bestows finality to unvitiated compromise agreements,” particularly
if there is no allegation that either party did not comply with what was incumbent
upon them under the agreement. The provision reads:
ART. 227 Compromise Agreements. – Any compromise settlement, including those involving labor standard laws, voluntarily agreed upon by the parties with the assistance of the Bureau or the regional office of the Department of Labor, shall be final and binding upon the parties. The National Labor Relations Commission or any court shall not assume jurisdiction over issues involved therein except in case of noncompliance thereof or if there is prima facie evidence that the settlement was obtained through fraud, misrepresentation, or coercion.
Thus, a judgment rendered in
accordance with a compromise agreement is not appealable, and is immediately
executory unless a motion is filed to set aside the agreement on the ground of
fraud, mistake, or duress, in which case an appeal may be taken against the
order denying the motion.[30] Under
Article 2037 of the Civil Code, “a compromise has upon the parties the effect
and authority of res judicata,” even
when effected without judicial approval; and under the principle of res judicata, an issue which had already
been laid to rest by the parties themselves can no longer be relitigated.[31]
In AFP Mutual Benefit Association, Inc. v. Court of Appeals,[32]
the Court spelled out the distinguishing features of a compromise agreement
that is basically intended to resolve a matter already in litigation, or what is normally termed as a judicial
compromise. The Court held that once approved, the agreement becomes more
than a mere contract binding upon the parties, considering that it has been
entered as the court’s determination of the controversy and has the force and
effect of any other judgment. The Court went on to state:
Adjective
law governing judicial compromises annunciate that once approved by the court,
a judicial compromise is not appealable and it thereby becomes immediately
executory but this rule must be understood to refer and apply only to those who
are bound by the compromise and, on the assumption that they are the only
parties to the case, the litigation comes to an end except only as regards to
its compliance and the fulfillment by the parties of their respective
obligations thereunder. The reason for the rule, said the Court in Domingo v. Court of Appeals [325 Phil.
469], is that when both parties so enter into the agreement to put a close to a
pending litigation between them and ask that a decision be rendered in
conformity therewith, it would only be “natural to presume that such action
constitutes an implicit waiver of the right to appeal” against that decision.
The order approving the compromise agreement thus becomes a final act, and it
forms part and parcel of the judgment that can be enforced by a writ of
execution unless otherwise enjoined by a restraining order.[33]
Thus, contrary to the allegation of petitioners, the execution and
subsequent approval by the NLRC of the agreement forged between it and the
respondent
In any event, the compromise
agreement cannot bind a party who did not voluntarily take part in the settlement
itself and gave specific individual
consent.[34] It must
be remembered that a compromise agreement is also a contract; it requires the
consent of the parties, and it is only then that the agreement may be considered
as voluntarily entered into.
The case of Golden Donuts, Inc. v. National Labor Relations Commission,[35]
which petitioners erroneously rely upon, is instructive on this point. The
Court therein was confronted with the following questions:
x x
x (1) whether or not a union may compromise or waive the rights to security of
tenure and money claims of its minority members, without the latter’s consent,
and (2) whether or not the compromise agreement entered into by the union with
petitioner company, which has not been consented to nor ratified by respondents
minority members has the effect of res
judicata upon them.”[36]
Speaking through Justice Reynato C.
Puno, the Court held that pursuant to Section 23, Rule 138[37] of the then 1964 Revised Rules of Court, a
special authority is required before a lawyer may compromise his client’s
litigation; thus, the union has no authority to compromise the individual claims
of members who did not consent to the settlement.[38]
The Court also stated that “the authority to compromise cannot lightly be
presumed and should be duly established by evidence,”[39] and
that “a compromise agreement is not valid when a party in the case has not
signed the same or when someone signs for and in behalf of such party without
authority to do so;” consequently, the affected employees may still pursue
their individual claims against their employer.[40] The
Court went on to state that a judgment approving a compromise agreement cannot
have the effect of res judicata upon non-signatories
since the requirement of identity of parties is not satisfied. A judgment upon
a compromise agreement has all the force and effect of any other judgment, and,
conclusive only upon parties thereto and
their privies, hence, not binding on third persons who are not parties to
it.[41]
A careful perusal of the wordings of
the compromise agreement will show that the parties agreed that the only issue
to be resolved was the question of the monetary claim of several employees. The
prayer of the parties in the compromise agreement which was submitted to the NLRC
reads:
WHEREFORE,
premises considered, it is respectfully prayed that the Compromise Settlement
be noted and considered; that the instant case [be] deemed close[d] and
terminated and that the Decision dated May 31, 2001 rendered herein by this
Honorable Commission be deemed to be fully implemented insofar as concerns the
thirty-one (31) employees mentioned in paragraphs 2c and 2d hereof; and, that the only issue
remaining to be resolved be limited to
the question of the monetary claim raised in the motion for clarification by
the seven employees mentioned in paragraph 2e hereof.[42]
The agreement was later approved by
the NLRC. The case was considered closed and terminated and the Resolution
dated
To reiterate, the rule is that when
judgment is rendered based on a compromise agreement, the judgment becomes
immediately executory, there being an
implied waiver of the parties’ right to appeal from the decision.[43] The
judgment having become final, the Court can no longer reverse, much less modify
it.
Petitioners’
argument that the CA is not a trier of facts is likewise erroneous. In the
exercise of its power to review decisions by the NLRC, the CA can review the
factual findings or legal conclusions of the labor tribunal.[44]
Thus, the CA is not proscribed from “examining evidence anew to determine
whether the factual findings of the NLRC are supported by the evidence
presented and the conclusions derived therefrom accurately ascertained.”[45]
The findings of the appellate court
are in accord with the evidence on record, and we note with approval the
following pronouncement:
Respondents alleged that it hired contractual employees majority of whom were those retrenched because of the increased but uncertain demand for its publications. Respondent did this almost immediately after its alleged retrenchment program. Another telling feature in the scheme of respondent is the fact that these contractual employees were given contracts of five (5) month durations and thereafter, were offered regular employment with salaries lower than their previous salaries. The Labor Code explicitly prohibits the diminution of employee’s benefits. Clearly, the situation in the case at bar is one of the things the provision on security of tenure seeks to prevent.
Lastly, it could not be said that
the employees in this case are barred from pursuing their claims because of
their acceptance of separation pay and their signing of quitclaims. It is
settled that “quitclaims, waivers and/or complete releases executed by
employees do not stop them from pursuing their claims – if there is a showing
of undue pressure or duress. The basic reason for this is that such quitclaims,
waivers and/or complete releases being figuratively exacted through the barrel
of a gun, are against public policy and therefore null and void ab initio (ACD
Investigation Security Agency, Inc. v. Pablo D. Daquera, G.R. No. 147473,
March 30, 2004).” In the case at bar, the employees were faced with impending
termination. As such, it was but natural for them to accept whatever monetary
benefits that they could get.[46]
CONSIDERING THE FOREGOING, the petition
is DENIED and the assailed Decision
and Resolution AFFIRMED. Costs against
the petitioners.
SO ORDERED.
ROMEO J. CALLEJO, SR.
Associate Justice
WE
CONCUR:
Chief Justice
Chairperson
CONSUELO YNARES-SANTIAGO MA. ALICIA AUSTRIA-MARTINEZ
Associate Justice
Associate Justice
Associate Justice
Pursuant to Section 13, Article VIII of the
Constitution, I certify that the conclusions in the above decision had been reached
in consultation before the case was assigned to the writer of the opinion of
the Court’s Division.
ARTEMIO
V. PANGANIBAN
Chief Justice
[1]
Petitioners erroneously labeled their recourse as one for “certiorari” under “Rule 65.” Since they are questioning a decision
of the Court of Appeals, the proper remedy is a petition for review under Rule
45. Inasmuch as the instant petition was filed within the 15-day reglementary
period, the Court hereby treats it as one filed under Rule 45.
[2] Penned by Associate Justice Juan Q. Enriquez, Jr., with Associate Justices Salvador R. Valdez, Jr. (Retired) and Vicente Q. Roxas, concurring; rollo, pp. 23-31.
[3] Rollo, pp. 32-33.
[4] Order
dated
[5] CA rollo, p. 372.
[6]
[7]
[8]
[9]
[10] Rollo, pp. 69-91.
[11] The dispositive portion of the Resolution reads:
WHEREFORE,
premises considered, [w]e hereby order respondent Philippine Journalists Inc.
to:
1.
Reinstate Maria Rosario T. Flores, Eddie H. Serrano and
Milagros B. Billones to their former position without loss of seniority rights
and other benefits;
2.
To pay the monetary claims of Antonio M. Ayo, Arnold S.
Santos, Judith A. Pulido, Maria Rosario T. Flores, Emmeline D. Nicolas,
Emmanuel M. Munar, Jr., Eddie H. Serrano, Razil B. Taleon and Milagros B.
Billones as shown in their computations quoted in this Resolution, the payment
being understood to be from date of dismissal up to actual date of
reinstatement; minus what they received as separation pay;
3.
To pay ten (10%) [percent] of the total monetary award as attorney’s
fees.
Lastly, the Compromise Agreement is hereby approved, as
prayed for, the case is deemed closed and terminated and our Resolution dated
SO ORDERED (CA rollo, p. 480).
[12] CA rollo, pp. 79-80.
[13]
[14] Some of the benefits claimed to have been diminished are meal allowance, rice allowance, quarterly bonus, vacation leave, holiday pay, anniversary bonus, longevity pay, allowance for eyeglasses, sick leaves, transportation allowance, and others.
[15] CA rollo, pp. 139-370.
[16]
[17]
[18] Rollo, pp. 30-31. (Emphasis supplied)
[19]
[20] Tichangco v. Enriquez, G.R. No. 150629, June
30, 2004, 433 SCRA 324, 333.
[21] De la Salle University v. Dela Salle
University Employees Association, 386 Phil. 569, 586 (2000), citing Flores v. National Labor Relations
Commission, 253 SCRA 494, 497 (1996).
[22] Oaminal v. Castillo, 459 Phil. 542, 556
(2003).
[23] Verde v. Macapagal, G.R. No. 151342,
[24] 379 Phil. 303 (2000).
[25] 394 Phil. 716 (2000).
[26]
[27] Filcon Manufacturing Corporation v. Lakas
Manggagawa sa
[28] article 211 (a), labor code.
[29] G.R.
No. 120482,
[30] Master Tours and Travel Corp. v. CA,
G.R. No. 105409,
[31] Reformist Union of R.B. Liner, Inc. v. NLRC,
supra.
[32] 370 Phil. 150, 163 (1999).
[33]
[34] See
[35] Supra note 23.
[36]
[37] The present provision reads in full:
Sec. 23. Authority of attorneys to bind clients.- Attorneys have authority
to bind their clients in any case by any agreement in relation thereto made in
writing, and in taking appeals, and in all matters of ordinary judicial
procedure. But they cannot, without special authority, compromise their
client’s litigation, or receive anything in discharge of a client’s claim but
the full amount in cash.
[38] Golden Donuts Inc. v. National Labor Relations Commission, supra note 23, at 312.
[39]
[40]
[41]
[42] Rollo, p. 486. (Emphasis supplied)
[43] Dela Cruz v. Court of Appeals, G.R. No.
151298, November 17, 2004, 442 SCRA 492, 504, citing De los Reyes v. De Ugarte, 75 Phil. 505, 507 (1945).
[44] Agustilo v. Court of Appeals, 417 Phil.
218, 227 (2001).
[45] Cathay Pacific Airways, Ltd. v. National
Labor Relations Commission, 414 Phil. 603, 611 (2001).
[46] Rollo, pp. 30-31.