G.R. No. 158786 - Toyota Motor Phils. Corp. Workers Association vs. National Labor Relations Commission

Toyota Motor Philippines Corporation Workers Association (TMPCWA) is a legitimate labor organization registered with DOLE and was certified by Med-Arbiter on May 12, 2000 as the sole and exclusive bargaining agent of Toyota’s rank-and-file; Toyota appealed this certification to the DOLE Secretary.
Toyota Motor Philippines Corporation is a domestic corporation engaged in vehicle assembly and sale; a BOI participant and locator under the Special Economic Zone Act; it operates plants in Bicutan and Sta. Rosa, employing about 1,400 workers, and reported assets of about P5.525B and net sales of P14.646B.

On February 14, 1999, TMPCWA filed a petition for certification election (NCR-OD-M-9902-001); Med-Arbiter denied, but the DOLE Secretary, by Order of June 25, 1999, directed the holding of the election; after Toyota’s reconsideration was denied, the election was held and TMPCWA was certified by Order of May 12, 2000; Toyota appealed to the DOLE Secretary.
TMPCWA submitted CBA proposals; Toyota refused to bargain pending the appeal; on January 16, 2001, the Union filed a notice of strike (NCMB-NCR-NS-01-011-01) for refusal to bargain; NCMB converted it to preventive mediation on February 5, 2001 due to the unresolved bargaining-agent issue.

A BLR hearing on Toyota’s appeal was set for February 21, 2001 (reset to February 22); on February 21, 135 Union officers/members refused overtime and picketed at BLR; Union sought to excuse absences for February 22, which Toyota denied; despite denial, more than 200 employees undertook mass actions and absences on February 22–23 at BLR/DOLE, causing manpower shortage and alleged losses of P53,849,991.
On February 27, 2001, Toyota issued show-cause notices to around 360 employees for defiance of overtime directives, absences on February 22–23, and concerted actions disrupting operations, citing Code of Conduct Sec. D(6) (inciting/participating in riots, disorders, alleged strikes or concerted actions detrimental to company interest; 1st offense-dismissal); a February 27 Union Manifesto urged strike/picket; the Union filed another notice of strike (NCMB-NCR-NS-02-061-01) for union busting and on March 1, 2001 sent a consolidated explanation invoking constitutional rights; Toyota issued clarificatory memoranda and set investigative interviews which employees refused to attend.

On March 16, 2001, Toyota terminated 227 officers/members for serious misconduct/abandonment and violation of Code Sec. D(6) and Article 282 (now 297) of the Labor Code; the notices cited deliberate participation in concerted actions causing substantial damage, unnecessary absences, and losses exceeding P50M.
On March 17, 2001, the Union went on strike; from March 28 to April 12, 2001 it barricaded the Bicutan and Sta. Rosa gates, blocking ingress/egress and intimidating personnel and officers, as attested by Security Head Eduardo Nicolas III, with photo/video documentation.

On March 29, 2001, Toyota petitioned the NLRC for injunction (NLRC NCR INJ-0001054-01); on April 5, 2001, the NLRC issued a TRO ordering the Union to remove barricades and ensure free ingress/egress; the Union’s motion to dismiss for lack of jurisdiction was denied; Toyota also filed a petition to declare the strike illegal (NLRC NCR (South) 30-04-01775-01).
On April 10, 2001, the DOLE Secretary assumed jurisdiction under Article 263(g) and certified the dispute to the NLRC (Certified Case No. 000203-01); all strikers were directed to return to work by April 16, 2001; Toyota was to accept them under status quo ante or payroll reinstate; parties were ordered to cease acts worsening the situation; the Union ended the strike on April 12; on April 16, Toyota opted for payroll reinstatement.

On May 23 and May 28, 2001, payroll-reinstated unionists staged protest actions/pickets at the Bicutan and Sta. Rosa plants; on June 5, 2001, the Union filed another notice of strike which the DOLE Secretary subsumed under the April 10 certification.
The NLRC repeatedly ordered position papers (from June 8, 2001 onward); the Union sought deferment due to a pending CA certiorari against the assumption order (CA-G.R. SP 64998), which the CA dismissed on July 17, 2001; despite repeated directives, the Union failed to seasonably file its position paper, later alleging mailing.

On August 9, 2001, the NLRC declared the February 21–23, 2001 and May 23/28, 2001 strikes illegal; upheld the legality of the dismissal of the 227; ordered severance compensation equivalent to one month per year of service as alternative relief; and declared named Union officers to have forfeited their employment for leading illegal strikes; MRs were denied on September 14, 2001.
Both parties elevated to the CA (CA-G.R. SP Nos. 67100 and 67561; consolidated); on February 27, 2003, the CA affirmed the NLRC on illegality and dismissals, deleted severance compensation, and noted defective verification (only 159 of 227 signed) but ruled on the merits; on June 20, 2003, the CA modified by reinstating severance pay based on social justice.
Before the Supreme Court, TMPCWA and dismissed employees (G.R. Nos. 158786 & 158789) assailed the CA/NLRC rulings; Toyota (G.R. Nos. 158798-99) challenged the reinstated award of severance pay; the petitions were consolidated.

Whether the February 21–23, 2001 mass actions and rallies at BLR/DOLE, the March 17–April 12, 2001 strike (including March 28–April 12 barricades), and the May 23 and 28, 2001 pickets constituted illegal strikes.

Whether non-compliance with Article 263 requisites and violation of company rules render the February actions illegal.
Whether unlawful means (barricades, obstruction, intimidation) rendered the March–April strike illegal under Article 264(e).
Whether the May pickets violated the DOLE Secretary’s assumption/certification Order under Article 263(g).

Whether union officers who knowingly participated in illegal strikes or illegal acts lost employment status under Article 264(a).
Whether ordinary members may be dismissed for mere participation in an illegal strike, absent illegal acts.

Whether the NLRC violated due process by disregarding the Union’s late-filed position paper and whether the CA erred regarding verification defects.

Whether multiple opportunities to file cured any due process concern.
Whether a petition verified by fewer than all petitioners substantially complies and its effect.

Whether separation pay or severance compensation may be awarded to employees validly dismissed for participating in illegal strikes or illegal acts, on grounds of social justice.