G.R. No. 120587 - Barco vs. Court of Appeals

Allied Banking Corporation (petitioner) and the Allied Bank Employees Union, along with its affiliated labor groups (respondents), were embroiled in a labor dispute.
The dispute arose from differing positions during the renewal of a collective bargaining agreement that was set to expire on June 30, 1984.

Failure of the parties to reach an amicable settlement—particularly on the issue of wage increases—led the Union to file a notice of strike with the Bureau of Labor Relations.
The ensuing labor dispute prompted intervention by the government when Minister Blas Ople assumed jurisdiction over the matter on December 16, 1984 pursuant to Article 263 (g) of the Labor Code.

On January 4, 1985, the petitioner filed a Manifestation and Urgent Motion with the Ministry of Labor and Employment, which led Minister Ople to issue a return-to-work order on January 6, 1985, also providing a P1,000 grant per employee (charged to future collective bargaining agreement benefits).
Subsequent orders issued on January 18, 1985 and January 31, 1985 attempted to steer the parties toward a settlement by directing continued negotiations and, upon failure to compromise, by mandating specific awards in the collective bargaining agreement.

Despite the return-to-work order, on February 11, 1985, certain union members (numbering 271 and including those identified later as respondents) resumed strike action.
Acts of violence associated with this renewed strike triggered criminal charges against some participants.
The petitioner, via published notices in various newspapers, directed striking employees to report back for work by February 13, 1985; failure to comply led to notices of termination for abandonment of work.

To address the labor unrest, Minister Ople on June 5, 1985 ordered provisional reinstatement of all striking employees except:

The Union subsequently filed petitions for certiorari and motions for preliminary injunction; these matters were docketed in consolidated petitions (G.R. Nos. 116128 and 116461).
The Labor Arbiter rendered a ruling declaring the strikes on January 3–4, 1985 and February 11–March 11, 1985 illegal due to violation of the return-to-work order, and found:

Union officers who actively and knowingly participated in the illegal strike lost their employment status;
The individual respondents, not directly involved in any extra-legal activities apart from noncompliance with the return-to-work order while on strike, should not be summarily punished as having abandoned their work if the strike’s legality was still under dispute.

Later, the NLRC and the Supreme Court grappled with issues of reinstatement and back wages for the 41 individual respondents who were not reinstated after 1986, remanding the computation of back wages to the Labor Arbiter pursuant to earlier Supreme Court resolutions.

The petitioner appealed administrative orders and subsequent motions regarding reinstatement and back wages, while respondents sought modification of reinstatement orders to cover back wages, benefits, and damages.
Despite various administrative decisions (including orders by Minister Ople and his successor Minister Augusto Sanchez) and motions for mandamus, the Court eventually had to address whether the dismissal for noncompliance with the return-to-work order was valid and if the 41 respondents were entitled to reinstatement with back wages.

Whether the strikes on January 3–4, 1985 and February 11–March 11, 1985 were illegal as they violated the return-to-work orders issued by the Minister of Labor and Employment.
Whether the union’s act of striking, despite the assumption order imposing an immediate return-to-work duty, constituted an illegal act that forfeited the employees’ right to reinstatement.

Whether the dismissal of employees, based on their failure to comply with the return-to-work order (thus amounting to abandonment of work), is justified under the relevant provisions of the Labor Code.
Whether mere participation in an illegal strike (or failure to obey a lawful order) automatically leads to the loss of employment status, especially differentiating the position of union officers from that of ordinary employees.

Whether the 41 individual respondents who were not reinstated are entitled to back wages from the time they should have been reinstated (since 1986) up to the final resolution of the dispute.
Whether the remand by the NLRC directing the Labor Arbiter to compute back wages is compatible with the Supreme Court’s underlying finding of valid dismissal based on defiance of the return-to-work order.