Case Digest (G.R. No. 239746)
Facts:
Limcoma Labor Organization (LLO)-PLAC v. Limcoma Multi-Purpose Cooperative, G.R. No. 239746, November 29, 2021, Supreme Court Second Division, Gaerlan, J., writing for the Court.
Petitioner LLO-PLAC is the duly registered sole and exclusive bargaining agent (SEBA) for respondent Limcoma Multi-Purpose Cooperative’s rank-and-file regular employees; supervisors, technical and confidential employees, managerial employees and the Board of Directors were excluded from the bargaining unit. In July 2005 respondent implemented a Voluntary Retire‑Rehire (VRR) Program which the parties finally memorialized in a Memorandum of Agreement dated July 29, 2005. The agreement provided, among other things, that covered employees would retire with severance, be rehired as new regular employees, receive industrial peace bonus, enjoy statutory leaves, and that profit‑sharing would increase from 15% to 18%; the union would remain SEBA and a new CBA would be negotiated in October 2005.
Following the VRR, a CBA took effect April 1, 2006 and was renewed July 4, 2011 for April 1, 2011–March 31, 2016. Section 2, Article VIII of the CBA provided: “The COOPERATIVE agrees to grant to all regular employees a profit‑sharing equivalent to Eighteen Percent (18%) of the net surplus… distribution of which shall be based on the basic salary.” During wage‑reopening negotiations in 2014 petitioner discovered that respondent had executed a separate “Kasunduan sa Voluntary Retire‑Rehire Program (K‑VRR)” with supervisors, technical and confidential employees, and managers under which those non‑rank‑and‑file signatories were also to receive an 18% profit sharing; petitioner also claimed it was not shown how individual shares were computed.
The parties submitted the dispute over the profit‑sharing provision to a DOLE‑accredited Voluntary Arbitrator (VA), Atty. Cenon Wesley P. Gacutan. In a Decision dated January 7, 2015 the VA held that Article VIII, Section 2 of the CBA entailed profit sharing “equivalent to 18% of the net of profit” exclusively for regular rank‑and‑file employees (the VA’s dispositive portion was quoted in the record). Respondent’s motion for reconsideration was denied by the VA on February 26, 2015.
Respondent then filed a petition for review under Rule 65 in the Court of Appeals (CA). On August 9, 2017 the CA (Peralta, J., with Baltazar‑Padilla and Santos, JJ., concurring) granted the petition, reversed the VA, and ruled that Article VIII, Section 2 entitled “ALL regular employees of the cooperative, regardless of their rank or position” to the 18% profit sharing, and that certain expenses were deductible from the 18% distributable amount. Petitioner’s motion for reconsideration before the CA was denied on May 16, 2018. Petitioner filed a Petition for Review on Certiorari under Rule 45 in this Court seeking to set aside the CA Decision and Resolution; the petition concerned only the coverage of the CBA profit‑sharing provision (claims for 2011–2013), rendering the wage deadlock academic.
Issues:
- Did the Court of Appeals commit serious error in ruling that supervisors, confidential and managerial employees are entitled to benefits under the rank‑and‑file CBA, specifically the 18% profit sharing?
- Did the Court of Appeals misapprehend that the 18% of net surplus under the parties’ CBA is a unilateral management grant and that the same 18% was the obligation respondent assumed under its separate agreement with non‑covered employees?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)