A.M. No. RTJ-12-2333 - Casar vs. Soluren

Case Summary (A.M. No. RTJ-12-2333)

Petitions, Complaints and Initial Administrative Actions

On May 12, 1989 the PTGWO filed a petition for certification election before the med-arbiter of DOLE seeking to be recognized as bargaining agent for a group of the petitioner’s delivery drivers/helpers. After submission of position papers, the med-arbiter dismissed the certification petition on August 25, 1989, finding no employer-employee relationship between petitioner and the drivers/helpers. Separately, the PTGWO and others filed a complaint for underpayment of wages and other money claims. The labor arbiter dismissed the money-claim complaint on February 9, 1990 for lack of an employer-employee relationship; that dismissal was appealed to the National Labor Relations Commission (NLRC) on February 26, 1990. The certification-election determination by the med-arbiter was appealed to the DOLE Secretary.

Secretary’s Review and Subsequent Administrative Proceedings

On December 15, 1989, then-Secretary Franklin Drilon reversed the med-arbiter’s dismissal and found that an employer-employee relationship existed, ordering a certification election among the drivers/helpers with choices PTGWO or No Union. Petitioner sought reconsideration on January 22, 1990 and filed a manifestation on February 12, 1990 requesting that DOLE hold action in abeyance pending resolution of the separate labor-arbiter money-claims case. The Secretary denied the requested abeyance by order dated April 16, 1990; petitioner’s motion for reconsideration of that denial was denied on June 18, 1990. The petitioner then filed a petition for certiorari seeking to enjoin enforcement of the Secretary’s orders and to contest the Secretary’s jurisdiction to determine employer-employee status in a certification election.

Preliminary Court Action and Parallel NLRC Ruling

The Court required respondents to comment and issued a temporary restraining order on September 19, 1990 enjoining execution of the Secretary’s challenged orders. Independently, the NLRC issued a resolution on September 19, 1990 reversing the labor arbiter and finding an employer-employee relationship; petitioner’s motion for reconsideration before the NLRC was denied on November 16, 1990.

Legal Issue Presented

The principal legal question was whether the med-arbiter (and by appellate review the DOLE Secretary) has the authority to determine the existence of an employer-employee relationship in a certification election proceeding, or whether that factual-legal determination is exclusively vested in the labor arbiter and the NLRC in money-claim proceedings.

Applicable Law and Standards

The Court relied on the Labor Code provisions governing the Bureau of Labor Relations (BLR) and appeals from certification election orders: Article 226 (BLR’s original and exclusive authority to act on disputes affecting labor-management relations in all workplaces) and Article 259 (appeal from med-arbiter orders in certification elections to the Secretary, to be decided within fifteen calendar days). The Court applied established jurisprudential factors for determining employer-employee relationships: (a) selection and engagement of the employee; (b) payment of wages; (c) power to dismiss; and (d) control over means and methods of work (citing Besa v. Trajano).

Court’s Analysis: Jurisdiction and Necessity of Determining Employer-Employee Relationship

The Court held that under Article 226 the BLR (and the med-arbiter as its officer) has original and exclusive authority over disputes, grievances, or problems affecting labor-management relations. Because resolution of a certification election necessarily requires a determination whether an employer-employee relationship exists, the med-arbiter must have the authority to make that determination. The Secretary, exercising appellate jurisdiction under Article 259, may review and reverse the med-arbiter’s factual and legal findings in certification election matters. The Court rejected petitioner’s contention that the med-arbiter and Secretary must await a separate determination by a labor arbiter or the NLRC in a distinct money-claim case before deciding employer-employee status in a certification election. Such a requirement would render the BLR’s jurisdiction and the certification process dysfunctional and anomalous, particularly where no separate money-claim proceeding exist

Case Syllabus (A.M. No. RTJ-12-2333)

Case Caption and Citation

Reported as 273 Phil. 482, First Division, G.R. No. 95011, April 22, 1991.
Parties: M.Y. San Biscuits, Inc. (Petitioner) v. Acting Secretary Bienvenido E. Laguesma and Philippine Transport and General Workers Organization (Respondents).
Decision authored by Justice Gancayco; Justices Narvasa (Chairman), Cruz, Grino-Aquino, and Medialdea concurred.

Core Legal Issue

Whether the med-arbiter or the Secretary of Labor and Employment has the authority to determine the existence of an employer-employee relationship between the parties in a petition for certification election.
Whether the Secretary of Labor abused discretion in denying petitioner's request to hold action in abeyance pending resolution of a separate NLRC proceeding addressing the employer-employee relationship.

Facts

On May 12, 1989, the Philippine Transport and General Workers Organization (the Union) filed a petition for certification election as bargaining agent for a group of employees (delivery drivers/helpers) of M.Y. San Biscuits before the med-arbiter of the Department of Labor and Employment (DOLE).
After submission of position papers, on August 25, 1989, the med-arbiter issued an order dismissing the petition for lack of merit, finding no employer-employee relationship between petitioner and the drivers/helpers (Annex D to the Petition).
Separately, the Union and several others filed before the NLRC Branch of Region No. IV a complaint for: underpayment of wages; non-payment of 13th month pay; service incentive pay and COLA; damages; and attorney’s fees.
On February 9, 1990, the labor arbiter rendered a decision dismissing that complaint for lack of employer-employee relationship (Annex E to the Petition).
The Union appealed the labor arbiter’s dismissal to the NLRC on February 26, 1990 (and later the NLRC reversed on September 19, 1990).
The Union appealed the med-arbiter’s certification-election dismissal to the Secretary of DOLE.

Procedural History in the Certification Election Case

August 25, 1989: Med-arbiter dismissed certification election petition (Annex D).
December 15, 1989: DOLE Secretary Franklin Drilon promulgated a resolution reversing the med-arbiter, finding an employer-employee relationship and ordering a certification election (Annex F; pages 162–163, Rollo).
January 22, 1990: Petitioner filed a motion for reconsideration of the Secretary’s December 15, 1989 resolution (Annex H).
February 12, 1990: Petitioner filed a manifestation asking that action be held in abeyance pending consideration of the other (money-claims) case before the labor arbiter/NLRC (Annex H).
April 16, 1990: Public respondent (Secretary) issued an order denying petitioner's manifestation seeking abeyance (Annex I).
Petitioner filed a motion for reconsideration which was denied on June 18, 1990 (Annex J; Annex K).
Petitioner filed a petition for certiorari with prayer for preliminary prohibitory injunction and temporary restraining order, alleging (i) abuse of discretion in denying the manifestation based on a prejudicial question pending before the NLRC; and (ii) that the Secretary lacked jurisdiction to determine employer-employee relationship (Page 6, Rollo).
September 19, 1990: The Supreme Court required respondents to comment within ten days and granted a temporary restraining order enjoining execution of the December 15, 1989 and June 18, 1990 orders.
September 19, 1990: NLRC promulgated a resolution reversing the labor arbiter and finding the existence of an employer-employee relationship (pages 132–143, Rollo).
November 16, 1990: Petitioner's motion for reconsideration before the NLRC was denied (pages 145–147, Rollo).
April 22, 1991: Supreme Court rendered decision dismissing the petition; lifted the TRO and awarded costs against petitioner.

Petitioner’s Contentions (as presented)

The Acting Secretary Bienvenido E. Laguesma abused his discretion in denying the manifestation asking to await the NLRC determination on the employer-employee relationship.
The Secretary of Labor has no jurisdiction to determine the existence of an employer-employee relationship between petitioner and the private respondent; that determination is vested in the NLRC.

Respondents’ Positions and Actions

The med-arbiter initially concluded there was no employer-employee relationship and dismissed the certification petition.
The Secretary of Labor (Drilon) reviewed on appeal and reversed the med-arbiter’s order, finding an employer-employee relationship and directing a certification election between PTGWO and No Union.
The Secretary denied petitioner's request to hold action in abeyance pending NLRC resolution.
The NLRC, on appeal from the labor arbiter’s dismissal in the money-claims case, reversed the labor arbiter and found the employer-employee relationship on September 19, 1990.

Applicable Legal Provisions Cited by the Court

Article 226, Labor Code (as amended): Establishes the Bureau of Labor Relations (BLR) and grants it original and exclusive authority to act on inter-union and intra-union conflicts and all disputes, grievances or problems arising from or affecting labor-management relations in all workplaces, whether agricultural or non-agricultural; the Bureau has fifteen (15) working days to act, subject to extension by agreement of the parties.
- The decision emphasizes that the med-arbiter, as an officer of the BLR, exercises that original and exclusive jurisdiction.
Article 259, Labor Code (as amended): Provides appeal to the Secretary of Labor and Employment from orders or results of a certification election as determined by the Med-Arbiter, where such appeals must be decided within fifteen (15) calendar days.
Precedent cited: Besa v. Trajano, 146 SCRA 501 (1987), relied upon for principle regarding the med-arbiter’s authority (citation noted in the decision).

Court’s Legal Reasoning on Jurisdiction and Authority

The BLR’s original and exclusive jurisdiction over labor-management disputes necessarily includes the authority to determine whether an employer-employee relationship exists between parties.
In exercising jurisdiction over certification e