Facts:

The case involves Philippine Airlines, Incorporated (PAL) as the petitioner and the Philippine Airlines Employees Association (PALEA) as the respondent. The events leading to this case began with a labor complaint filed by PALEA against PAL and Mary Anne del Rosario, PAL's Director of Personnel, on March 1, 1989. The complaint alleged unfair labor practices due to the non-payment of the 13th month pay to employees who had not been regularized by April 30, 1988, as stipulated in their Collective Bargaining Agreement (CBA). The CBA, entered into on February 6, 1987, covered the period from 1986 to 1989 and included provisions for a 13th month pay and a Christmas bonus.

PAL issued an implementing guideline on April 22, 1988, which specified that only employees regularized by April 30, 1988, would receive the 13th month pay, while those not regularized would receive a prorated amount based on their months of service. PALEA contested this guideline, arguing that all employe...

Facts:

Background of the Case:

• This case involves a labor dispute between Philippine Airlines, Inc. (PAL) and the Philippine Airlines Employees Association (PALEA), the collective bargaining agent for PAL's rank-and-file employees.
• The dispute arose from PAL's refusal to pay the 13th month pay (mid-year bonus) to employees who were not regularized as of 30 April 1988, as stipulated in the Collective Bargaining Agreement (CBA) between PAL and PALEA.

Collective Bargaining Agreement (CBA):

• On 6 February 1987, PAL and PALEA entered into a CBA covering the period 1986 to 1989.
• The CBA included provisions for the payment of a 13th month pay (mid-year bonus) and a Christmas bonus to rank-and-file employees.
  • Section 4: A 13th month pay, equivalent to one month's basic pay, was to be paid in advance in May.
  • Section 5: A Christmas bonus, equivalent to one month's basic pay, was to be paid in December.

Implementing Guidelines:

• On 22 April 1988, PAL issued an implementing guideline for the 13th month pay, which stated:
  • Eligibility: Only employees regularized as of 30 April 1988 were entitled to the 13th month pay in May.
  • Non-regular employees: Those not regularized by 30 April 1988 would receive their 13th month pay by 24 December 1988.

PALEA's Complaint:

• PALEA filed a complaint with the National Labor Relations Commission (NLRC) on 1 March 1989, alleging unfair labor practice for PAL's refusal to pay the 13th month pay to non-regularized employees.
• PALEA argued that the Presidential Decree No. 851 (requiring 13th month pay) covers all employees, regardless of their regularization status.

Labor Arbiter's Decision:

• On 12 March 1990, the Labor Arbiter dismissed PALEA's complaint, ruling that PAL was not guilty of unfair labor practice. The Labor Arbiter held that the 13th month pay was an additional practice and not a mandatory obligation under the CBA.

NLRC's Reversal:

• On appeal, the NLRC reversed the Labor Arbiter's decision on 28 January 1998, ordering PAL to pay the 13th month pay to all employees, including those not regularized by 30 April 1988.
• PAL's motion for reconsideration was denied on 23 June 1998.

Court of Appeals' Decision:

• PAL appealed to the Court of Appeals, which dismissed the petition on 30 April 1999, affirming the NLRC's decision.
• The Court of Appeals held that the CBA's provision on the 13th month pay should be interpreted in favor of labor, and all doubts should be resolved in favor of employees.

Rehabilitation of PAL:

• During the pendency of the case, the Securities and Exchange Commission (SEC) placed PAL under rehabilitation on 17 May 1999, appointing a permanent rehabilitation receiver.
• Under Presidential Decree No. 902-A, all claims against a corporation under rehabilitation are suspended.

Issue:

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Ruling:

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Ratio:

1. Interpretation of the CBA: The Court of Appeals correctly interpreted the CBA in favor of labor, as all doubts in labor disputes should be resolved in favor of employees.
2. Suspension of Claims During Rehabilitation: Under Presidential Decree No. 902-A, all claims against a corporation under rehabilitation are suspended to prevent the dissipation of the company's resources and to allow the rehabilitation receiver to focus on restructuring the company.
3. Labor Claims Are Included in Suspension: The suspension of claims applies to all types of claims, including labor claims, as allowing such claims to proceed would hinder the rehabilitation process.