G.R. No. L-51382 - Enriquez vs. Zamora

Case Digest (G.R. No. L-51382)
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Facts:

Parties and employment history

Petitioners Rafael Enriquez and Virgilio Ecarma were employed by Philippine Air Lines [PAL] on October 2, 1961 and March 3, 1966, respectively.
Both petitioners became members of Air Lines Pilot Association of the Philippines [ALPAP].
Respondents included Hon. Ronaldo B. Zamora, Hon. Blas F. Ople, the National Labor Relations Commission [NLRC], Arbiter Nestor Lim, PAL, Air Lines Pilot Association of the Philippines, and Ortiz’ Group.

The October 1970 labor dispute and Court of Industrial Relations [CIR] orders

On October 3, 1970, PALEA and ALPAP staged a strike against PAL to demand pay increases, better working conditions on the Manila-Karachi and Rome-Amsterdam flights, and a better retirement plan.
Under Section 10 of Republic Act No. 875, the President of the Philippines certified the strike to the CIR.
Through Associate Judge Ansberto Paredes, the CIR issued an order dated October 7, 1970 directing:

PALEA and ALPAP to call off the strike and lift picket lines.
Strikers to return to work not later than Friday, October 9, 1970.
PAL to admit striking employees “back to work under the same terms and conditions of employment existing before the strikes.”
PAL not to suspend, dismiss, or lay off any employee as a result of the strike.

The CIR stated noncompliance would constitute contempt, and that employees failing or refusing to return by October 9, 1970, without justifiable cause would be replaced and could not be reinstated without prior court order and justifiable grounds.
Strikers sought reconsideration but returned to work on October 22, 1970 after denial of reconsideration.

Dismissal of Captain Gaston and ALPAP resolutions for protest retirement/resignation

On October 27, 1970, PAL dismissed strike leader Captain Felix Gaston.
On October 30, 1970, ALPAP’s board of directors adopted a resolution condemning PAL’s alleged harassment and unfair labor practices, including:

Attempted lockout of ten members.
Actual lockout of three members.
Forced retirement of Captain Regino Masias [Macias].
Dismissal of ALPAP leader Captain Felix Gaston.

The board resolved to undertake:

Grounding of all PAL planes.
Filing applications for “protest retirement” of members with five years of continuous service.
Filing “protest resignation” for those with less than five years of service.

On November 9, 1970, the board adopted another resolution directing all union members to accomplish “protest retirement” or “protest resignation” forms on or before November 17, 1970.
On November 12, 1970, Captain Gaston issued a circular setting the submission deadline at November 17, 1970 at 2400H.

PAL’s ex parte urgent motion and the CIR status quo order of November 26, 1970

Many ALPAP members allegedly signed protest retirement/resignation papers.
Anticipating an en masse submission, PAL filed with the CIR an ex parte urgent motion to enjoin ALPAP officers and members from retiring or resigning en masse.
On November 26, 1970, the CIR issued an order pending hearing that required:

The parties to maintain status quo.
ALPAP members and officers not to strike or cause any stoppage of PAL operations and service, under pain of dismissal and forfeiture of rights and privileges.
PAL not to lock out ALPAP members and officers, under pain of contempt and cancellation of its franchise.

December 1970 “protest retirement/resignation” and PAL’s acceptance and forfeiture notice

Despite the November 26, 1970 CIR order, some ALPAP officers and the majority of members submitted their retirement or resignation letters to PAL on December 12, 1970.
Petitioners tendered their retirement or resignation individually.
The letters were couched as “in vigorous protest” to alleged provocations, unfair labor tactics, a contemptuous lockout, and PAL’s “vicious and vindictive attitude” exemplified by illegal termination of Capt. Gaston.
The letters invoked retirement plan provisions and stated expectation of payment of benefits within seventy-two [72] hours.
PAL acknowledged receipt of the letters and stated it “chopped” petitioners from the payroll on 1:30 P.M. December 14, 1970, the time and date it received the letters.
PAL asserted petitioners’ “retirement” was in pursuance of a conspiracy and in violation of the November 26, 1970 CIR order in CIR Case No. 101-IPA[B].
PAL declared petitioners not entitled to benefits under the Retirement Plan or other rights, benefits, and privileges due to forfeiture resulting from their acts.

Readmission of petitioners and resulting new seniority rankings

On January 12, 1971, Ecarma returned to PAL after being away for thirty days.
On January 18, 1971, Enriquez followed after not reporting for thirty-six days.
Before readmission, PAL required two conditions:

Petitioners sign conformity to PAL’s letter of acceptance of their retirement and/or resignation.
Petitioners submit an application for employment as new employees “without protest or reservation.”

On March 17, 1971, PAL issued a new seniority list for pilots.
Petitioners’ new seniority dates were set as:

Enriquez: January 18, 1971.
Ecarma: January 12, 1971.

Petitioners thereby lost almost ten years of seniority and five years of seniority, respectively, and started from zero seniority.

Petition for restoration of seniority and privileges before the CIR, then transfer to NLRC

Enriquez and Ecarma, together with twenty-three other pilots, filed before the CIR a petition to restore their seniority and other privileges.
They alleged they were not apprised by the union of the legal consequences of retirement/resignation and claimed they were told to obey or be expelled from the union.
They alleged they were expelled by ALPAP on February 12, 1971.
PAL opposed the petition and alleged:

The mass retirement/resignation constituted contempt of court.
Petitioners were accepted on probationary basis for six months.
Since their retirement or resignation violated the November 26, 1970 CIR order, petitioners lost privileges and benefits acquired as PAL employees.

Some ALPAP members led by Captain Ben Hur Gomez manifested they would submit to any final ruling.
Ortiz’ Group, headed by Captain Carlos Ortiz, intervened alleging their seniority was earned on a first-come-first-serve basis and granting Enriquez’ group relief would prejudice them.
During the pendency, the CIR was abolished, and the case was turned over to the NLRC for adjudication.

Acting Labor Arbiter Nestor C. Lim’s order dated March 31, 1975

On March 31, 1975, Acting Labor Arbiter Nestor C. Lim denied the petition for restoration of seniority and other privileges.
The labor arbiter reasoned that the March 17, 1971 seniority ranking should be respected to avoid injustice and demoralization and to forestall disruption of PAL’s smooth operations.
The arbiter mitigated the penalty by allowing returning pilots to receive:

Fifty percent [50%] or one-half of the retirement benefits they would have received under the PAL-ALPAP Retirement Plan but for the violation of the court order.

NLRC en banc appeal and compromise agreement

Both PAL and Enriquez’ group appealed to the NLRC en banc.
On August 15, 1975, at the conference-hearing, the parties entered into a compromise agreement stipulating:

Termination of the employee-employer relationship between PAL and pilots who joined the mass retirement/resignation in December 1970, and consequent loss of seniority accruing to their old employment.
PAL would pay pilots who reapplied as new pilots and who were already taken in as such by PAL:

Eighty-five [85%] percent of retirement pay under the PAL-...(Subscriber-Only)

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