G.R. No. 201237 - Philippine Touristers, Inc. vs. MAS Transit Workers Union-ANGLO-KMU

On June 14, 2000, the respondent union—Samahan ng Manggagawa sa Mas Transit-Anglo-KMU (the Union)—filed a petition for a certification election before the DOLE–National Capital Region, seeking the representation of certain MTI bus drivers/conductors already affiliated with the Alliance of Nationalist and Genuine Labor Organizations.
The Department of Labor and Employment granted the petition, prompting MTI to file a motion for reconsideration, which was later denied in a resolution dated February 7, 2001.
Around or on September 15, 2000, MTI decided to sell its 50 passenger buses, along with its Certificate of Public Convenience (CPC) issued by the LTFRB, to Philippine Touristers, Inc. (PTI) for a consideration of P98,345,834.43.
The LTFRB approved the sale on December 28, 2000, and PTI was subsequently issued a new CPC to operate a designated route using the transferred buses.

On March 7, 2001, MTI issued a public notice (patalastas) informing all employees of the sale of its operations and its intention to pay separation benefits per legal requirements and available resources, advising them to reapply with PTI if interested.
On March 31, 2001, MTI sent a memorandum to each of the individual respondents, informing them of their termination effective that day due to the cessation of business operations, which was linked to the sale.

The Union, representing 98 members, filed a complaint before the NLRC alleging illegal dismissal, unfair labor practices (specifically illegal lockout), and damages.
MTI and associated petitioners (including PTI and its president, Alejandro R. Yague, Jr.) denied any irregularity, contending that the termination was valid due to financial reverses and the subsequent cessation of operations.
They further argued that no employer-employee relationship existed between PTI and the terminated respondents, stressing that PTI was merely the buyer of certain assets (passenger buses) and not a successor in interest to MTI.

The LA, in a decision dated July 14, 2003, ruled in favor of the respondents and found MTI and petitioners guilty of unfair labor practice, noting that the closure and termination were designed to subvert the employees’ right to self-organization.
The LA emphasized inconsistencies—pointing out that only Union members were locked out while others were retained, and that the alleged financial reverses did not have a factual basis.
Following the LA’s ruling, petitioners appealed before the NLRC. During the pendency of the NLRC proceedings, issues concerning the posting of the required cash or surety bond arose.
Petitioners initially posted a partial bond and filed a motion to reduce the bond requirement due to PTI’s liquidity problems, submitting PTI’s Audited Financial Statement (AFS) in support.
The NLRC, after dismissing and later reinstating the appeal upon a motion for reconsideration and subsequent posting of additional and replacement bonds, eventually modified its earlier decision by holding that there was no basis to hold petitioners jointly and severally liable with MTI, given the distinct nature of the entities.

The CA, in its decision dated November 25, 2011, annulled the NLRC’s modified ruling on the ground of grave abuse of discretion, particularly criticizing the NLRC’s liberal interpretation of the bond requirement rules.
Petitioners filed a motion for reconsideration, which was denied in a resolution dated March 12, 2012, leading to the petition for review on certiorari before the Supreme Court.

The central issue is whether the Court of Appeals erred in ascribing grave abuse of discretion to the NLRC for:

Reinstating petitioners’ appeal based on the acceptance of a reduced or partially compliant bond, and
Modifying the LA’s decision by absolving petitioners of liability on the ground that there existed no employer-employee relationship between PTI and the terminated respondents.