G.R. No. 244828 - Ching vs. Bonachita-Ricablanca

The case arose from a complaint filed by petitioners for illegal dismissal, unfair labor practice, and refund of cash bond before the Arbitration Branch of the National Labor Relations Commission (NLRC).
The petition seeks the annulment of the NLRC resolutions dated July 5, 1993 (which reversed the Labor Arbiter’s decision holding respondents liable) and August 10, 1993 (which denied petitioners’ motion for reconsideration).

On August 23, 1980, Fortune Tobacco Corporation (FTC) entered into a contract for security services with Fortune Integrated Services, Inc. (FISI), wherein FISI was to provide security guards for FTC.
Petitioners were among the security guards employed to protect FTC’s facilities, namely its main factory plant, tobacco redrying plant, and warehouse.
The petitioners rendered their services under the supervision and control of FTC’s security personnel, although they were on FISI’s payroll.

On February 1, 1991, the incorporators and stockholders of FISI sold all their shares to a new group, effectuating a change in control.
Concurrently, FISI’s Articles of Incorporation were amended, and the corporate name was changed to Magnum Integrated Services, Inc. (MISI).
A new set of by-laws was adopted and approved by the Securities and Exchange Commission on June 4, 1993.

On October 15, 1991, FTC terminated the contract for security services with FISI/MISI, leading to the displacement of approximately 582 security guards, including the petitioners.
FTC subsequently contracted the services of two other security agencies, Asian Security Agency and Ligalig Security Services, to replace FISI/MISI’s personnel.
Petitioners claimed that their termination was a pretext to bust the union they had recently organized.

The Fortune Tobacco Labor Union, an affiliate of the National Federation of Labor Unions (NAFLU), had sent a Notice of Strike to FISI/MISI around October 1991, asserting its role as the bargaining agent of the security guards.
On November 14, 1991, petitioners participated in a picketing activity against FTC, which was later enjoined by a writ of injunction from the Regional Trial Court of Pasig.
On November 29, 1991, Simeon de Leon and sixteen other complainants filed the case before the NLRC’s Arbitration Branch, subsequently amending the complaint to include additional petitioners.

Petitioners alleged that they were regular employees of FTC (which had operated under various corporate names including Fortune Integrated Services, Inc. and Magnum Integrated Services, Inc.) and were unfairly dismissed without due process or valid cause.
They asserted that the dismissal was intended to dismantle their newly-founded union and to obstruct their rights under the Labor Standards Law.
Respondents, FTC and FISI/MISI, contended respectively that there was no direct employer-employee relationship between FTC and the petitioners and that the termination was merely a result of FTC pre-terminating the contract for services, thereby not subjecting them to liability.

The Labor Arbiter originally found in favor of the petitioners by applying the “single employer” principle and holding both FTC and FISI liable for the wrongful acts.
On appeal, the NLRC reversed the Labor Arbiter’s decision, ruling that FISI (already renamed MISI) had distinct stockholders and offices from FTC, thereby disallowing the application of the “single employer” doctrine and dismissing the allegations of illegal dismissal and unfair labor practices.
Petitioners’ motion for reconsideration before the NLRC was denied, leading to the filing of the present petition.

Determining the existence and nature of the employer-employee relationship between petitioners and the respondent corporations.
Whether due process and valid cause were observed in terminating the services of the petitioners.

Whether the actions taken by the respondents constitute unfair labor practice.

Whether there was interference with the petitioners’ right to self-organization and union activities.
If the termination of their service was a deliberate scheme to bust their newly organized union.

Establishing the nature of the cash bond and its relation to their employment status.
Whether the improper termination or unfair labor practices warrant a refund.