Title
Supreme Court
Automotive Engine Rebuilders, Inc. vs. Progresibong Unyon ng mga Manggagawa sa AER
Case
G.R. No. 160138
Decision Date
Jul 13, 2011
AER and its union clashed over illegal strikes, drug tests, and unfair labor practices; SC upheld CA, ruling both parties equally at fault, ordering reinstatement without backwages.

Case Summary (G.R. No. 160138)

Dispute Overview

The conflict arose from allegations of unfair labor practices, illegal suspensions, and illegal dismissal filed by both parties against each other. AER claimed that employees participated in illegal strikes, while the Union accused AER of illegal suspensions related to drug testing and unfair labor practices following the establishment of a union.

Management's Version

On January 28, 1999, AER management reported a sudden walkout by 18 employees, leading to unauthorized occupation of company premises where they attempted to cart away equipment. Following multiple refusals to return to work and intimidation towards management, AER issued disciplinary notices. By the end of February, a wildcat strike ensued, prompting police intervention and a subsequent temporary restraining order from the NLRC.

Union's Version

The Union filed a petition with the DOLE for a certification election in December 1998. In retaliation, AER mandated urine drug tests for all employees, resulting in positive drug tests for several. AER suspended these employees without reinstatement and later accused them of insubordination and absence without leave, prompting the filing of a complaint by the Union for unfair labor practices and alleged illegal dismissal.

Labor Arbiter's Ruling

The Labor Arbiter ruled in favor of the Union on August 9, 2001, emphasizing that the suspensions were without valid cause or due process. The LA highlighted the hostile relationship stemming from the Unionization efforts and found that AER’s management acted excessively in their dealings with employees. While ruling in favor of the Union for reinstatement, the LA deemed both parties partially culpable for their respective actions.

NLRC Ruling

Upon appeal, the NLRC modified the Labor Arbiter's decision on March 5, 2002, ruling that the majority of the complaints were unfounded. It upheld the suspensions of only three employees (who tested positive for drugs) as valid, determining AER acted within its management prerogatives. It ruled that the concerted actions of employees did not meet the threshold of legality, thus sanctioning AER's dismissal.

Court of Appeals Ruling

On June 27, 2003, the Court of Appeals partly favored the Union, ordering the reinstatement of 26 employees without backwages, while agreeing with the NLRC on the legality of the suspensions. The CA reasoned that the collective action taken by the employees was invalid, establishing that both parties exhibited unfair labor practices.

Revised Decision

After a motion for reconsideration by the Union on October 1, 2003, the CA amended its earlier ruling, ordering the immediate reinstatement of the suspended employees without backwages based on their collective right to their employment status. Despite AER's objections, the CA maintained that the actions surrounding the drug tests and subsequent dismissals were legally dubious and lacked empirical support.

Grounds for Appeal

Both parties filed petitions concerning the CA’s decision. The Union argued for backwages for reinstated employees

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