G.R. No. 108001 - San Miguel Corporation vs. National Labor Relations Commission

Private respondents were employed by petitioner San Miguel Corporation (SMC) as mechanics, machinists, and carpenters.
The respondents were bona fide officers and active members of the union Ilaw at Buklod ng Manggagawa (IBM).

On or about July 31, 1990, petitioner Angel G. Roa, Vice-President and Manager of SMC’s Business Logistics Division, issued a memorandum directing the separation of the employees effective October 31, 1990 on the ground of “redundancy or excess personnel.”
The respondent union opposed the intended dismissal and requested a dialogue with management, which led to a series of discussions between the parties.
Before concluding these dialogues, petitioner Roa issued another memorandum on October 1, 1990, indicating that the private respondents would be dismissed effective November 2, 1990.
The employees were ultimately terminated on November 2, 1990.

On February 25, 1991, the private respondents filed a complaint for illegal dismissal, unfair labor practices (ULP), and a claim for damages with the Arbitration Branch of the National Labor Relations Commission (NLRC).
The complaint was assigned to Labor Arbiter Eduardo F. Carpio for hearing and disposition.
Petitioners filed a motion to dismiss the complaint on April 15, 1991, arguing that the Labor Arbiter lacked jurisdiction due to the existence of a Collective Bargaining Agreement (CBA) mandating grievance and arbitration procedures.
The Labor Arbiter denied the motion on September 23, 1991, and subsequent appeals by the petitioners were also dismissed by the NLRC.

Petitioners filed a certiorari petition challenging the jurisdiction of the Labor Arbiter.
The petitioners asserted that:

The Labor Arbiter was without jurisdiction to hear the complaint without prior resort to the grievance and arbitration procedures set forth in the CBA.
The strong state policy promoting voluntary settlement of labor disputes mandated that termination and ULP issues be resolved through the agreed arbitration mechanism.

The dispute centered on whether the termination, ostensibly due to redundancy, should be first resolved via the grievance procedure provided in the CBA, and if the ULP claims were sufficient to confer jurisdiction on the Labor Arbiter.

Petitioners pointed to Section 1, Article V of the CBA, which stipulated that wages, hours of work, conditions of employment, and/or employer-employee relations should be settled by arbitration.
They argued that the dispute over the termination and ULPs should be channeled through the grievance machinery and arbitration because of:

The agreement on arbitration embodied in the CBA.
The implication in Section 2, Article III regarding job security and the right to seek reconsideration.

The respondent union and other public respondents refuted that any request for reconsideration had been made, maintaining that the complaint was properly filed before the Labor Arbiter.

Whether the Labor Arbiter has original and exclusive jurisdiction over the termination dispute and ULP complaint under Article 217(a) of the Labor Code.
Whether the provisions of the CBA, specifically the arbitration clause in Section 1, Article V, and the grievance mechanism in Section 2, Article III, should preclude the direct filing of such cases with the Labor Arbiter.

Whether the respondent union’s filing of the complaint without first seeking reconsideration under the grievance machinery infringes on the mandatory procedural requirements set out in the CBA.

Whether the allegations in the complaint sufficiently established a bona fide case of ULP, particularly in view of the claims of discriminatory termination affecting the employees’ right to self-organization.
Whether the alleged ULPs, as set forth, clearly demonstrate interference in union activities and a violation of rights protected by the Labor Code.