G.R. No. 149552 - General Milling Corporation vs. Casio

This case originated from the dismissal of union officers and members, namely Ernesto Casio, Rolando Igot, Mario Famador, Nelson Lim, Felicisimo Booc, Procopio Obregon, Jr., and Antonio Aninipok, employees of General Milling Corporation (GMC).
The involved union, Ilaw at Buklod ng Mangagawa (IBM)-Local 31, was the sole and exclusive bargaining agent for the GMC employees at Lapu-Lapu City.
A Collective Bargaining Agreement (CBA) was entered into on November 30, 1991 between IBM-Local 31 and GMC, effective retroactively from August 1, 1991, and it contained union security provisions that required all employees to be members in good standing of the union.
Under the CBA, GMC was mandated to terminate employment of any employee who failed to comply with the union membership requirement upon the union’s written request.

Casio, who had been elected President of IBM-Local 31, along with his co-respondents (union shop stewards), was accused of committing “acts inimical to the interest of the union.”
On February 24, 1992, IBM Regional Director Rodolfo Gabiana sent a letter to Casio and his co-respondents, accompanied by affidavits from other employees, and requested that they respond within three days to the charges.
Casio and his colleagues refused to acknowledge the receipt of the letter, which led IBM-Local 31, on February 29, 1992, to issue a resolution expelling them from the union.
Gabiana followed up with letters on March 10 and March 19, 1992, addressed to GMC's management, urging the immediate dismissal of Casio and his co-respondents based on the closed shop provisions embedded in the CBA.
Under pressure from the union’s demand and the threat of an unfair labor practice suit, GMC terminated the employment of the affected employees via a memorandum dated March 24, 1992, with the term “preventive suspension” preceding their final dismissal effective April 24, 1992.
A Notice of Strike was filed by Casio and his cohorts on March 27, 1992 with the National Conciliation and Mediation Board (NCMB) after the controversial dismissals.

Casio and his co-respondents filed a complaint for unfair labor practices and other claims (illegal dismissal, illegal suspension, and damages) before the National Labor Relations Commission (NLRC) which was initially dismissed for lack of jurisdiction and later referred to NCMB for voluntary arbitration.
In voluntary arbitration (VA Case No. AC 389-01-01-95), arbitrator Alice K. Canonoy-Morada rendered an award on August 16, 1995, dismissing the complaint for lack of merit but awarding separation pay and attorney’s fees.
Dissatisfied with the VA Award, Casio et al. elevated the case to the Court of Appeals via a Petition for Certiorari under Rule 65, which set aside the arbitration award.
The Court of Appeals found that, although GMC was entitled to dismiss the employees pursuant to the closed shop provision, it had failed to observe the elementary rules of due process. Accordingly, it ordered the reinstatement of the dismissed employees with full backwages, and held union officers (Pino et al.) liable for moral and exemplary damages and attorney’s fees.
GMC’s Motion for Reconsideration was denied on July 18, 2001, prompting GMC to file the present Petition for Review on Certiorari before the Supreme Court under Rule 45 of the Rules of Court.

Whether the Court of Appeals erred by setting aside the Voluntary Arbitration Award based on its findings that GMC failed to observe fundamental procedural due process in dismissing Casio and his co-respondents.
Whether GMC’s reliance on the union’s internal expulsion process sufficed to justify the dismissal under the union security clause of the CBA, in light of the requirement to observe due process.
Whether GMC can be absolved of liability for wrongful dismissal by shifting responsibility solely to the union officers (Pino et al.) who executed the expulsion resolution.
Whether the evidentiary basis for the union’s decision to expel Casio et al. was adequate for GMC to act upon without conducting an independent inquiry to determine the sufficiency of evidence.