Title
Juat vs. Court of Industrial Relations
Case
G.R. No. L-20764
Decision Date
Nov 29, 1965
Employee dismissed for refusing to join union under valid CBA closed-shop provision; SC upheld dismissal, citing non-membership and failure to return post-suspension.
labor union
dismissal
collective bargaining agreement
A

Case Summary (G.R. No. L-20764)

Factual Background and the Closed-Shop Arrangement

The Court of Industrial Relations found that on December 1, 1959, Bulaklak Publications entered into a collective bargaining agreement with the BUSOCOPE LABOR UNION to remain effective for three years, with renewal for another three-year term. The agreement’s Section 4 contained a closed-shop proviso.

On December 27, 1960, Section 4 was amended. Under the amended text, employees or workers who were members of the union “in good standing” as of January 1, 1960, and those who became members thereafter, were required, as a condition of employment, to maintain membership for the duration of the agreement. It also provided that employees or workers who were not yet members of the union as of January 1, 1961 were required, as a condition of maintaining employment, to become members of the union.

The Court of Industrial Relations concluded that Bulaklak Publications required Juat to become a member of the BUSOCOPE LABOR UNION by reason of this closed-shop proviso, and it characterized the employer’s demand as compliance with the parties’ collective bargaining agreement, as sanctioned by law.

The Alleged Acts Giving Rise to the ULP Charge

The complaint alleged that Juat was an employee of the respondent company since August 1953. It further alleged that on or about July 15, 1960, and on several occasions thereafter, he was asked by his employer to join the BUSOCOPE LABOR UNION but he refused. The complaint also alleged that he was suspended without justifiable cause and later dismissed.

According to the complaint, there were two separate cases filed by Juat against the respondents: one on March 13, 1961 for unfair labor practice and another on March 18, 1961 for the payment of wages for overtime work and work on Sundays and holidays. The complaint asserted that the filing of those cases came to the knowledge of the respondents. It alleged that on March 15, 1961, Bulaklak Publications dismissed him without justifiable cause and that after dismissal, he had not found substantial employment.

Respondents’ Defense and Counterclaim

In an answer dated August 3, 1961, the respondents denied that the suspension and separation were acts of reprisal. They alleged that Juat was suspended for cause. They also claimed that they learned of the unfair labor practice case filed on March 13, 1961 only upon receipt of the summons and a copy of the petition on March 24, 1961. As to the second case filed on April 3, 1961, they alleged that they learned of it only long after the employer-employee relationship had already been terminated.

The respondents asserted instead that Juat caused his own separation. They alleged that Juat ignored a letter sent by Juan N. Evangelista, the executive officer of the company, requiring him to report for work. They also stated that Juat refused to work because he was occupied with his business, Juat Printing Press Co., in which he was a stockholder and the treasurer.

The respondents also sought a counterclaim for damages on the ground that Juat filed an unwarranted and malicious action.

Decision of the Court of Industrial Relations

After hearing, Associate Judge Baltazar N. Villanueva of the Court of Industrial Relations rendered a decision on August 15, 1962 dismissing the complaint. The decision did not include any pronouncement regarding the respondents’ counterclaim. Juat then filed a motion for reconsideration. On October 30, 1962, the Court of Industrial Relations en banc denied the motion for reconsideration.

Accordingly, Juat filed the present petition for certiorari to review the said decision and resolution.

Findings and Conclusions of the Court of Industrial Relations

In its decision, the Court of Industrial Relations held that the closed-shop proviso was valid and enforceable. It reasoned that because of the refusal to become a member of the BUSOCOPE LABOR UNION, Juat was suspended for 15 days. After the suspension, Evangelista ordered Juat to report for duty, but Juat did not do so. The Court of Industrial Relations therefore treated Juat as dropped from the service due to his continued refusal to report when ordered.

The Court of Industrial Relations also found a separate ground for dismissal: Juat’s refusal to return to work after the end of his suspension, despite being ordered to do so by his superior. It found that Juat did not want to return because he was already engaged in his own establishment, the “Juat Printing Press Co. Inc.,” where he served as stockholder and treasurer.

On the allegation that Juat had filed another case on March 12, 1961 docketed as Case No. 1462-V, the Court of Industrial Relations deemed it of no moment. It relied on a ruling in Royal Interocean Lines, et al. v. Court of Industrial Relations, et al. (promulgated October 31, 1960), cited in the text as (109 Phil. 900), to the effect that an employee’s filing of charges, giving testimony, or being about to give testimony had no relation to union activities. It also stated that with respect to Case No. 2789-ULP, Evangelista claimed he did not know of its filing.

Issues Raised by Petitioner

Before the Court, Juat contended that the Court of Industrial Relations committed grave abuse of discretion:

First, it allegedly erred in applying the collective bargaining agreement’s closed-shop proviso to him, considering he was an old employee.

Second, it allegedly erred in holding that Bulaklak Publications did not commit unfair labor practice when it dismissed him for refusal to join the BUSOCOPE LABOR UNION.

Third, it allegedly committed grave abuse of discretion when it dismissed the complaint for lack of substantial evidence.

The Parties’ Substantive Positions

Juat’s position was anchored on the argument that the closed-shop proviso should not apply to him because he was an old employee when the collective bargaining agreement was entered into and amended.

The respondents’ position, as reflected in the Court of Industrial Relations’ findings, was that the closed-shop proviso was enforceable as a matter of union security and that Juat, although employed since August 1953, was not a member of any labor union at the time the agreement containing the closed-shop proviso was entered into. The respondents maintained that they dismissed him lawfully based on his refusal to join the contracting union and also on his refusal to report for work when ordered after his suspension.

Legal Basis and Reasoning on the Closed-Shop Provision

The Court of Industrial Relations, as affirmed in substance by the Supreme Court, treated the closed-shop proviso as sanctioned by Section 4, subsection (a) paragraph 4 of Republic Act No. 875, otherwise referred to in the text as the Industrial Peace Act or the Magna Charta of labor. The cited provision was described as allowing an agreement requiring union membership as a condition of employment, provided the labor organization properly represented the employees.

The Court also invoked the Court’s prior rulings sustaining closed-shop agreements, including National Labor Union vs. Aguinaldo’s Echague, et al., 97 Phil. 184. It further relied on doctrinal reiterations in Tolentino, et al. vs. Angeles, et al., 99 Phil. 309, Ang Malayang Manggagawa Ng Ang Tibay Enterprises, et al. vs. Ang Tibay, et al. (G. R. No. L-8259, Dec. 23, 1957), Confederated Sons of Labor vs. Anakan Lumber Co., et al., 107 Phil. 915, and Bacolod-Murcia Milling Co., et al. vs. National Employees Workers Security Union, 53 Off. Gaz., 615.

The reasoning proceeded to the central question of applicability: whether the closed-shop proviso in the collective bargaining agreement applied to Juat as an old employee. The Court noted it was undisputed that Juat had been employed since 1953, while the collective bargaining agreement was entered into on December 1, 1959 and amended on December 27, 1960. However, it was established that Juat was not a member of any labor union when the agreement was entered into and in fact had never been a member of any labor union.

The Court anchored the rule on Freeman Shirt Manufacturing Co., Inc. et al. vs. Court of Industrial Relations, et al., 110 Phil. 962, which, as quoted in the text, held that a closed-shop agreement applies to persons to be hired or to employees who are not yet members of any labor organization. It was held in that doctrine to be inapplicable only to those already in service who were members of another union, because compelling disaffiliation from a minority union and joining the contracting union would render nugatory the right to self-organization and union choice guaranteed under the Industrial Peace Act and the Constitution (Art. III, sec. 1 [6]) as stated in the text. The decision also referenced a policy concern that certification election issues would be foreclosed if closed-shop clauses applied in a way that perpetually shifted union representation among incumbent employees.

The Court stated that the doctrine in Freeman had been reaffirmed in Findlay Miller Timber Co. vs. PLASLU et al., 116 Phil. 534. It theref

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