G.R. No. 196735 - People vs. Feliciano, Jr.

Case Summary (G.R. No. 196735)

Factual Background

Francisco Salunga was an employee of San Miguel Brewery, Inc. since 1948 and a member of NABAILUP-PAFLU since 1953. The parties' collective bargaining agreement, executed October 2, 1959, contained a clause (Section 3) requiring members not to resign earlier than thirty days before the agreement's expiry. On August 18, 1961, Salunga submitted a letter of resignation which the Union accepted on August 26 and sent to the Company on August 29. When the Company informed him that resignation would lead to termination under the closed-shop clause, Salunga on August 31 revoked his resignation and requested continuation of dues deductions, supplying the Company a copy. The Company initially indicated it would consider him still a member and continue deductions. On September 8, 1961, the Union refused to reinstate him and insisted on his separation. The Company warned that it would have to dismiss Salunga if the Union persisted. After the Union reiterated its demand, the Company gave notice of termination effective September 30, 1961. Salunga sought review by the national officers of the PAFLU; the PAFLU deferred action but ultimately found no ground to reverse the Union. Salunga then purported to appeal to the PAFLU National Convention and asked the Company to maintain the status quo, but the Company, through Miguel Noel, terminated his employment at the close of business on October 15, 1961.

Trial Court Proceedings

A prosecutor of the Court of Industrial Relations filed unfair labor practice charges against the Union, its officers, the Company, and Miguel Noel. The trial judge found the Union, John de Castillo, Cipriano Cid, San Miguel Brewery, Inc., and Miguel Noel guilty of unfair labor practices. The trial court ordered the Union and its officers to readmit Salunga to membership upon payment of dues and to restore his membership rights. It directed the Company and Noel to reinstate Salunga to his former or substantially equivalent position with one-half back wages, without prejudice to seniority and other rights, and to post the decision. On motion for reconsideration, the Court of Industrial Relations en banc reversed the trial court, with two judges concurring in the result and the trial judge dissenting. Salunga appealed the en banc dismissal to the Supreme Court.

The Parties' Contentions

Francisco Salunga contended that his resignation was tendered only after he was provoked by irregularities in union disbursements and by his removal as steward, that he promptly revoked his resignation upon learning that resignation would mean loss of his employment under the closed-shop clause, and that the Union acted arbitrarily in refusing readmission without reasonable cause. The Union and its officers defended the refusal as justified and characterized Salunga's criticisms as disloyalty; they maintained that the resignation stood and that the Company properly implemented the collective bargaining agreement. The Company asserted that it had tried to preserve the status quo, informed Salunga of the contractual consequences of resignation, and only dismissed him reluctantly after the Union and the PAFLU insisted on his discharge.

Ruling of the Supreme Court

The Supreme Court reversed the en banc decision of the Court of Industrial Relations and affirmed the trial court's disposition with modification. The Court held that the Union and its officers were guilty of unfair labor practices in refusing to permit the withdrawal of Salunga's resignation without just cause. The Court ordered that Salunga be readmitted to the Union upon compliance with dues requirements and be reinstated to his former or substantially equivalent position with back pay. The Court exculpated the Company, holding that the Company was not guilty of unfair labor practice. The Court directed that back pay be borne exclusively by the Union, permitted the lower court to authorize measures—including deductions or check-off from sums due to the Union—to execute the judgment, and assessed costs against respondents except the Company.

Legal Basis and Reasoning

The Court found that although Salunga initially resigned and the Union accepted the resignation, he revoked the resignation promptly upon learning that resignation would result in dismissal under the closed-shop provision, and the Union refused revocation without just cause. The trial judge had found credible evidence that the Union officers' refusal stemmed from Salunga's criticisms of alleged irregular disbursements and from personal animus. The Supreme Court accepted those factual findings and noted that the Union offered no evidence to rebut the testimony that Salunga had objected to specific expenditures and had been removed as steward without notice. The Court emphasized that the constitution and by-laws of the Union recognized a member's right to express views on union transactions and that such expression implicated the freedom of speech guaranteed in the Constitution. The Court explained that where a union holds a monopoly in the supply of labor by reason of a closed shop or union shop, the admission and discipline of members become affected with the public interest; therefore the union could not arbitrarily exclude or refuse readmission to a qualified member. The Court concluded that a long-standing member who was induced by provocation to resign and who promptly revoked that resignation could not be arbitrarily denied readmission. Conversely, the Court found that the Company acted reasonably. The Company had informed Salunga of the contractual consequences, had initially considered him still a member, and had sought to avoid interfering in internal union affairs. The Company reasonably relied on the PAFLU's review and its sustainment of the local Union; it thus was justified in terminating employment when the union and national officers insisted. For these reasons the Company was not guilty of unfair labor practice.

Doctrinal Takeaway

The Court reaffirmed that labor unions subject to a closed shop or union shop arrangement are subject to public-interest constraints

Case Syllabus (G.R. No. 196735)

Parties and Procedural Posture

Francisco Salunga was the petitioner and a long-standing employee of San Miguel Brewery, Inc. since 1948.
National Brewery & Allied Industries Labor Union of the Philippines (NABAILUP-PAFLU) was the certified bargaining agent with John de Castillo as its president and Cipriano Cid as the PAFLU national president.
Miguel Noel was the assistant-secretary and vice-president of San Miguel Brewery, Inc. and a respondent in the unfair labor practice proceedings.
The Court of Industrial Relations trial division found respondents guilty of unfair labor practices and ordered affirmative reliefs in favor of petitioner.
The Court of Industrial Relations en banc reversed the trial decision and dismissed the case with two judges concurring in the result and the trial judge dissenting.
The petitioner appealed from the CIR en banc resolution to the Supreme Court.

Key Facts

The parties executed a collective bargaining agreement on October 2, 1959, effective until June 30, 1962.
Article II, Section 3 of the agreement required that covered workers who were union members on the signing date or who joined during the effectivity of the agreement shall not voluntarily resign from the union earlier than thirty days before the agreement's expiry.
Salunga had been a member of the union since 1953 and submitted a resignation on August 18, 1961, which the union accepted on August 26, 1961, and transmitted to the Company on August 29, 1961, requesting immediate implementation of Section 3.
Upon being informed that resignation would result in termination under the closed-shop provision, Salunga sent a letter on August 31, 1961 revoking his resignation and advised the union and the Company to continue dues deductions.
The union refused reinstatement on September 8, 1961, and persisted in demanding Salunga's separation, resulting in the Company serving notice of dismissal effective September 30, 1961 and ultimately discharging Salunga on October 15, 1961.
Petitioner sought internal review from the PAFLU national officers and then purported to appeal to the PAFLU National Convention, but the record lacked proof that the Convention had acted or that appeal had been perfected before dismissal.
A prosecutor of the Court of Industrial Relations filed unfair labor practice charges on or about December 7, 1961.

Collective Bargaining Provision

Section 3 of Article II of the CBA provided that employees who were union members on signing or who joined during the agreement effectivity shall not voluntarily resign earlier than thirty days before the agreement's expiry.
The same provision expressly stated that nothing therein required the Company to enforce any sanction against employees who fail to retain membership for causes other than voluntary resignation or non-payment of regular union dues.

Issues Presented

Whether the Union committed an unfair labor practice by arbitrarily refusing to allow petitioner to withdraw his resignation and by insisting on his discharge.
Whether the Company committed an unfair labor practice by dismissing petitioner pursuant to the union's insistence despite petitioner’s attempted revocation of resignation and asserted appeal to higher union authority.
What remedies, if any, should follow from a finding of unfair labor practice.

Contentions of the Parties

The petitioner contended that he revoked his resignation upon learning its employment consequences and that the union unlawfully and arbitrarily refused readmission and compelled his dismissal.
The Union and its officers contended that petitioner had