A.C. No. 11550 - Trovela vs. Robles

Meycauayan College is a private educational institution operating in Meycauayan, Bulacan, duly organized under Philippine laws.
The college recognized the Meycauayan College Faculty and Personnel Association (MCFPA) as the employees’ union on January 16, 1987.
Prior to this recognition, the college and the union (then headed by Mrs. Teresita V. Lim) entered into a Collective Bargaining Agreement (CBA) covering the school years 1983-1986.

Article IV of the CBA set forth a “Salary Scale” based on teachers’ length of service.
The salary scale detailed specific rates for various ranges of years of service, clearly delineating the agreed-upon increase in salaries beyond statutory mandates.
The intent of the CBA was to improve the financial conditions of the employees by increasing their salary according to their years of service.

At the time the CBA was entered into, several Presidential Decrees were in effect:

P.D. No. 1389 (May 29, 1978) – Adjusting the existing statutory minimum wages.
P.D. No. 1713 (August 18, 1980) – Providing for an increased minimum daily wage and additional mandatory allowances.
P.D. No. 1751 (May 14, 1980) – Increasing the statutory daily minimum wage by integrating an emergency living allowance into the basic pay.

Wage Order No. 2 (issued July 6, 1983) was also operative just before the CBA was finalized.
During the CBA’s lifetime, further wage orders (Nos. 3, 4, 5, and 6) were issued, mandating increases in basic minimum wage and living allowances, which were duly observed by the college.

In 1987, after the change in union leadership from Mrs. Teresita V. Lim to Mrs. Fe Villarico, the new president discovered that the provisions of Article IV (Salary Scale) were not being implemented by the college.
The union promptly filed a notice of strike on March 27, 1987, alleging an unfair labor practice due to the employer’s failure to comply with the agreed-upon salary scale.

Following the union’s strike and picketing on May 20, 1987, the Secretary of Labor assumed jurisdiction over the labor dispute.
The Director of the Department’s Regional Office No. III in San Fernando, Pampanga, conducted an inquiry and reported that, although the college had complied with the statutory increases, it had not observed the contractual obligation under the CBA.
The Director emphasized that compliance with statutory wage orders is distinct from compliance with contractual salary scales, noting that non-compliance with a CBA can lead to an unfair labor practice.
A specific case was highlighted involving a union member with twenty years of service who, under statutory law, was entitled to a lower rate compared to the rate mandated by the CBA.
The report recommended that the college immediately comply with the salary scale provision and pay the appropriate salary differential, including the differential for the 13th month pay for the affected school years.

Strictly pay salaries in accordance with the CBA.
Pay the salary differential for the school years 1983-1984, 1984-1985, and 1985-1986, including the 13th month pay differential.

The college’s motion for reconsideration was denied on December 3, 1987.
Subsequently, Meycauayan College filed a petition for certiorari seeking to issue a writ of preliminary injunction and/or a temporary restraining order to enjoin the enforcement of the Secretary’s orders.
On February 15, 1988, a temporary restraining order was issued by the Court.

Meycauayan College argued that the Secretary of Labor abused his discretion by holding the college liable for unpaid salary differentials under the CBA, contending that statutory salary increases should offset the contractual salary scale differences.
The petitioner also claimed that applying a retroactive effect beyond the one-year prescriptive period (as provided in Article 290 of the Labor Code) was improper, given that the strike was effected more than a year after the alleged unfair labor practice arose.
The college asserted that the dispute was merely a money claim, not a strikable issue under the Labor Code, and therefore beyond the original jurisdiction of the Secretary of Labor.

Whether the statutory wage increases mandated by Presidential Decrees and subsequent wage orders automatically constitute compliance with the collective bargaining agreement’s (CBA) salary scale provisions.

Does the receipt of statutory increments preclude employees from claiming the salary differential as stipulated in the CBA?
Are benefits granted by law automatically inclusive of, or equivalent to, those negotiated contractually in the CBA?

Whether the issue raised is a mere money claim or an unfair labor practice arising from the non-compliance with a binding contractual agreement.

Whether the one-year prescriptive period (under Article 290 of the Labor Code) for filing claims of unfair labor practice should bar the union’s claim for salary differentials for school years 1983-1984 and 1984-1985.
Whether the peculiar circumstances surrounding the late discovery of the CBA’s provisions by the union justify an extension beyond the prescribed period.