G.R. No. 64313 - National Housing Corp. vs. Juco

Juco served as project engineer of the National Housing Corporation (NHC) from November 16, 1970, to May 14, 1975.
His employment ended following allegations of involvement in theft and/or malversation of public funds concerning 214 pieces of scrap G.I. pipes.
The dismissal was effected on May 14, 1975, at the close of working hours.

On March 25, 1977, Juco filed a complaint for illegal dismissal with the Regional Office No. 4 of the Department of Labor (now Ministry of Labor and Employment).
The complaint was docketed as R04-3-3309-77 and later certified for compulsory arbitration under the case number RB-IV-12038-77 before the National Labor Relations Commission (NLRC).
Juco’s position paper, submitted on July 15, 1977, denied the criminal charges and asserted that his dismissal was based on fabricated allegations designed to harass him, particularly due to his role as a witness in a theft case involving high officials of the NHC.

The NLRC lacked jurisdiction over the complaint because the NHC is a government-owned and controlled corporation.
Even if under the NLRC's jurisdiction, Juco’s separation was valid and justified, as he had sold company property (the scrap pipes) at a junk shop and appropriated the proceeds for personal benefit.

The NHC is a 100% government-owned corporation, organized in accordance with Executive Order No. 399 (the Uniform Charter of Government Corporations, January 5, 1951).
Its capital stock is fully subscribed by government agencies, which include:

The corporation was organized to implement governmental policies for a coordinated massive housing program, primarily targeting low-cost housing among other governmental objectives.

Section 1, Article XII-B of the Constitution explicitly includes “government-owned or controlled corporations” in the Civil Service.
The 1935 Constitution provided a similar mandate, showing intent to extend civil service coverage to all governmental agencies and instrumentalities.

Presidential Decree No. 807 mandates that personnel of government-owned or controlled corporations are part of the civil service system.
The Labor Code (P.D. No. 442, as amended) specifies that government employees and those in government-owned or controlled corporations are governed by the Civil Service Law, rules, and regulations.

Deliberations during the 1971 Constitutional Convention addressed the scope of inclusion of government-owned or controlled corporations within the Civil Service.
The debates highlighted differing opinions about whether such entities should enjoy certain labor rights akin to those in the private sector, particularly concerning unionization and collective bargaining.

The NLRC and other government institutions took the position that NHC’s employees fall under civil service provisions.
Dissenting opinion by Justice Abad Santos argued that the NHC, not created by special law, might not automatically qualify for civil service coverage and pondered if it should instead be governed by the Labor Code.

Whether the NLRC has jurisdiction over the complaint for illegal dismissal given that the NHC is a government-owned or controlled corporation.
The impact of the corporation’s government-controlled status on the proper forum for resolving employment disputes.

Whether employees of the NHC should be covered under the Labor Code or governed by the provisions of the Civil Service Law and its corresponding rules and regulations.

The meaning and scope of “government-owned or controlled corporations” as provided in Section 1, Article XII-B of the Constitution.
The significance of historical debates and legislative amendments regarding the extension of civil service coverage to such corporations.

Whether Juco’s dismissal was valid and justified, especially considering the allegations against him and the procedural handling of the case.