Case Summary (G.R. No. 175073)
Factual Background
In 2012, the parties submitted an issue for voluntary arbitration before the National Conciliation and Mediation Board concerning entitlement of rank-and-file employees to salary adjustments under the parties’ Collective Bargaining Agreement for January 1, 2010 to December 31, 2014. Several employees retired during the period. A group identified in the record as Pingol, et al. refused to sign quitclaims and awaited the arbitration outcome. Another group identified as Lumbre, et al. executed quitclaims to receive retirement benefits. The voluntary arbitrator on September 25, 2012 ruled that employees covered by the CBA were entitled to specified across-the-board increases for 2010 and corresponding increases under the CBA. The Company thereafter paid Pingol, et al. with salary differentials. The Union later submitted for arbitration whether Lumbre, et al. could claim the same salary adjustments.
Subsequent Voluntary Arbitration and Immediate Proceedings
On September 22, 2017, the voluntary arbitrator ruled that Lumbre, et al. were not entitled to the salary increases because they had executed quitclaims upon retirement. The Union filed a motion for reconsideration of that decision. The voluntary arbitrator denied the motion on November 9, 2017. The Union received a copy of the denial on November 27, 2017. On December 12, 2017 the Union filed a petition for review under Rule 43 of the Rules of Court with the Court of Appeals, docketed as CA-G.R. CEB-SP No. 11429.
Court of Appeals Resolutions
On March 8, 2018, the Court of Appeals dismissed the petition for review. The Court of Appeals reasoned that decisions of voluntary arbitrators became final and executory after ten calendar days from receipt and were not subject to a motion for reconsideration under DOLE Department Order No. 40, series of 2003 and the 2005 Procedural Guidelines. The Court of Appeals therefore concluded that an appeal to the Court of Appeals must be filed within ten calendar days from receipt, and it found that the Union’s petition was filed fifteen days after receipt and was thus untimely. The Union sought reconsideration before the Court of Appeals, which the Court denied on May 21, 2018. The Court of Appeals relied on Philippine Electric Corporation (PHILEC) v. Court of Appeals for the proposition that a party may choose reconsideration or appeal within ten days.
The Parties’ Contentions Before the Supreme Court
The Petitioner urged that the correct period to appeal a voluntary arbitrator’s decision to the Court of Appeals is fifteen days from receipt of the denial of a motion for reconsideration under Rule 43 of the Rules of Court, relying on the principle of exhaustion of administrative remedies and on the Court’s ruling in Teng v. Pahagac. The Union also argued on the merits that Lumbre, et al. were entitled to salary differentials and that the executed quitclaims could not divest them of benefits under the CBA. The Respondent maintained that appeal is a privilege subject to the manner and period prescribed by law and reiterated that the reglementary period to appeal the voluntary arbitrator’s decision to the Court of Appeals was ten calendar days from notice.
Issue Presented
Whether the petition for review filed with the Court of Appeals on December 12, 2017 was timely under the provisions governing appeals from voluntary arbitrators’ decisions and whether the Court of Appeals erred in dismissing the petition as barred by finality.
Ruling of the Supreme Court
The petition for review under Rule 45 of the Rules of Court was granted. The Supreme Court reversed and set aside the Court of Appeals’ Resolutions dated March 8, 2018 and May 21, 2018 in CA-G.R. CEB-SP No. 11429. The case was remanded to the Court of Appeals for a proper resolution on the merits with dispatch.
Legal Basis and Reasoning
The Court recognized the textual tension between Article 276 of the Labor Code, which provides that the award or decision of voluntary arbitrators shall be final and executory after ten calendar days from receipt, and Rule 43 of the Rules of Court, which provides a fifteen-day period to appeal to the Court of Appeals. The Court reviewed prior inconsistent jurisprudence and relied on the En Banc decision in Guagua National Colleges v. Court of Appeals, which clarified the correct construction: the ten-day period in Article 276 is the time within which the adversely affected party may file a motion for reconsideration before the voluntary arbitrator. Only after disposition of that motion may the aggrieved party appeal to the Court of Appeals by filing a petition for review under Rule 43 of the Rules of Court, within fifteen days from notice pursuant to Section 4 of Rule 43. The Court invoked Teng v. Pahagac in articulating the importance of allowing a motion for reconsideration consistent with exhaustion of administrative remedies. Applying this construction to the present record, the Court found that the Union received the voluntary arbitrator’s denial of reconsideration on November 27, 2017 and therefore had fifteen days, until December 12, 2017, to file a petition for review. The Union filed on December 12, 2017 and thus timely perfected its appeal. The Court held that the Court of
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Case Syllabus (G.R. No. 175073)
Parties and Procedural Posture
- DORELCO Employees Union-ALU TUCP filed a Petition for Review on Certiorari under Rule 45 assailing the Court of Appeals' Resolutions dated March 8, 2018 and May 21, 2018 in CA-G.R. CEB-SP No. 11429.
- Don Orestes Romualdez Electric Cooperative (DORELCO), Inc. opposed the petition and defended the dismissal of the Rule 43 petition as time-barred.
- The Court of Appeals dismissed the Union's Rule 43 petition on March 8, 2018 and denied reconsideration on May 21, 2018 for being filed beyond a ten-day reglementary period.
- The Supreme Court reviewed the CA resolutions on the ground that the CA misapplied the applicable reglementary period for appeals from voluntary arbitrators.
Key Factual Allegations
- The parties submitted for voluntary arbitration in 2012 the issue whether rank-and-file employees were entitled to salary adjustments under the collective bargaining agreement covering January 1, 2010 to December 31, 2014.
- A group of retirees identified as Pingol, et al. refused to execute quitclaims and awaited the arbitration result, while another group identified as Lumbre, et al. executed quitclaims to receive retirement benefits.
- On September 25, 2012, the voluntary arbitrator ruled that employees were entitled to specified across-the-board increases for 2010 and additional increases pursuant to the CBA.
- The Company thereafter paid Pingol, et al. their retirement benefits inclusive of salary differentials, and the Union later sought arbitration on whether Lumbre, et al. could claim similar salary adjustments.
- On September 22, 2017, the voluntary arbitrator held that Lumbre, et al. were not entitled to salary increases because they had executed quitclaims.
- The voluntary arbitrator denied the Union's motion for reconsideration on November 9, 2017, and the Union received the denial on November 27, 2017.
- The Union filed a Petition for Review under Rule 43 of the Rules of Court in the Court of Appeals on December 12, 2017.
Statutory Framework
- Article 276 of the Labor Code provides that the award or decision of voluntary arbitrators shall be final and executory after ten calendar days from receipt of a copy by the parties.
- Rule 43, Rules of Court, Section 4 provides that an appeal from the judgment or final orders of voluntary arbitrators must be made within fifteen days from notice.
- Department Order No. 40, series of 2003, Rule XIX, Section 7 and the 2005 Procedural Guidelines contain provisions declaring voluntary arbitrator decisions final after ten days and disallowing motions for reconsideration.
- Prior jurisprudence reflected variable application of the ten-day and fifteen-day periods, including Sevilla Trading Co. v. Semana, Coca-Cola Bottlers Phils., Inc. v. Coca-Cola Bottlers Philippines, Inc., and Philippine Electric Corporation (PHIL