Philippine Electric Corporation (PHILEC) vs. Court of Appeals
Philippine Electric Corporation (PHILEC) vs. Court of Appeals
Philippine Electric Corporation (PHILEC) vs. Court of Appeals
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* SECOND DIVISION.
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Appeals
LEONEN, J.:
An appeal to reverse or modify a Voluntary Arbitrator’s
award or decision must be filed before the Court of Appeals
within 10 calendar days from receipt of the award or
decision.
This is a petition1 for review on certiorari of the Court of
Appeals’ decision2 dated May 25, 2004, dismissing the
Philippine Electric Corporation’s petition for certiorari for
lack of merit.
Philippine Electric Corporation (PHILEC) is a domestic
corporation “engaged in the manufacture and repairs of
high voltage transformers.”3 Among its rank-and-file
employees were Eleodoro V. Lipio (Lipio) and Emerlito C.
Ignacio, Sr. (Ignacio, Sr.), former members of the PHILEC
Workers’ Union (PWU).4 PWU is a legitimate labor
organization and the exclusive bargaining representative of
PHILEC’s rank-and-file employees.5
From June 1, 1989 to May 31, 1997, PHILEC and its
rank-and-file employees were governed by collective
bargaining agreements providing for the following step
increases in an employee’s basic salary in case of
promotion:6
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366
On August 18, 1997 and with the previous collective
bargaining agreements already expired, PHILEC selected
Lipio for promotion from Machinist under Pay Grade VIII7
to Foreman I under Pay Grade B.8 PHILEC served Lipio a
memorandum,9 instructing him to undergo training for the
position of Foreman I beginning on August 25, 1997.
PHILEC undertook to pay Lipio training allowance as
provided in the memorandum:
This will confirm your selection and that you will undergo
training for the position of Foreman I (PG B) of the Tank
Finishing Section, Distribution Transformer Manufacturing and
Repair effective August 25, 1997.
You will be trained as a Foreman I, and shall receive the
following training allowance until you have completed
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7 Id., at p. 76.
8 Id., at p. 134.
9 Id.
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Ignacio, Sr., then DT-Assembler with Pay Grade VII,11
was likewise selected for training for the position of
Foreman I.12 On August 21, 1997, PHILEC served Ignacio,
Sr. a memorandum,13 instructing him to undergo training
with the following schedule of allowance:
This will confirm your selection and that you will undergo
training for the position of Foreman I (PG B) of the Assembly
Section, Distribution Transformer Manufacturing and Repair
effective August 25, 1997.
You will be trained as a Foreman I, and shall receive the
following training allowance until you have completed the
training/observation period which shall not exceed four (4)
months.
First Month - - - - - P255.00
Second Month - - - - - P605.00
Third Month - - - - - P1,070.00
Fourth Month - - - - - P1,070.00
Please be guided accordingly.14
On September 17, 1997, PHILEC and PWU entered into
a new collective bargaining agreement, effective
retroactively
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10 Id.
11 Id., at p. 76.
12 Id., at p. 135.
13 Id.
14 Id.
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To be promoted, a rank-and-file employee shall undergo
training or observation and shall receive training
allowance as provided in Article IX, Section 1(f) of the June
1, 1997 collective bargaining agreement:17
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Claiming that the schedule of training allowance stated
in the memoranda served on Lipio and Ignacio, Sr. did not
conform to Article X, Section 4 of the June 1, 1997
collective bargaining agreement, PWU submitted the
grievance to the grievance machinery.19
PWU and PHILEC failed to amicably settle their
grievance. Thus, on December 21, 1998, the parties filed a
submission agreement20 with the National Conciliation and
Mediation Board, submitting the following issues to
voluntary arbitration:
I
WHETHER OR NOT PHILEC VIOLATED SECTION 4 (Step
Increases) ARTICLE X (Wage and Position Standardization) OF
THE EXISTING COLLECTIVE BARGAINING AGREEMENT
(CBA) IN IMPLEMENTING THE STEP INCREASES RELATIVE
TO THE PROMOTION OF INDIVIDUAL COMPLAINANTS.
II
WHETHER OR NOT PHILEC’s MANNER OF
IMPLEMENTING THE STEP INCREASES IN CONNECTION
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18 Id., at p. 65.
19 Id., at pp. 85-86 and 115.
20 Id., at pp. 73-74.
370
In their submission agreement, PWU and PHILEC
designated Hon. Ramon T. Jimenez as Voluntary
Arbitrator (Voluntary Arbitrator Jimenez).22
Voluntary Arbitrator Jimenez, in the order23 dated
January 4, 1999, directed the parties to file their respective
position papers.
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21 Id., at p. 73.
22 Id.
23 Id., at p. 82.
24 Id., at pp. 111-133.
25 Id., at pp. 123-125.
371
For PHILEC’s failure to apply the schedule of step
increases under Article X of the June 1, 1997 collective
bargaining agreement, PWU argued that PHILEC
committed an unfair labor practice under Article 24827 of
the Labor Code.28
In its position paper,29 PHILEC emphasized that it
promoted Lipio and Ignacio, Sr. while it was still
negotiating a new collective bargaining agreement with
PWU. Since PHILEC and PWU had not yet negotiated a
new collective bargaining agreement when PHILEC
selected Lipio and Ignacio,
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26 Id.
27 Labor Code, Art. 248 provides:
Art. 248. Unfair labor practices of employers.—It shall be unlawful
for an employer to commit any of the following unfair labor practice:
....
(i) To violate a collective bargaining agreement.
28 Rollo, p. 129.
29 Id., at pp. 83-90.
372
To preserve the hierarchical wage structure within
PHILEC’s enterprise, PHILEC and PWU allegedly agreed
to implement the uniform pay grade scale under the
“Modified SGV” pay grade system, thus:34
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Pay grade bracket I-IX covered rank-and-file employees,
while pay grade bracket A-F covered supervisory
employees.35
Under the “Modified SGV” pay grade scale, the position
of Foreman I fell under Pay Grade B. PHILEC then
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35 Id.
36 Id., at p. 54.
37 Labor Code, Art. 261 provides:
Art. 261. Jurisdiction of Voluntary Arbitrators or panel of Voluntary
Arbitrators.—The Voluntary Arbitrator or panel of Voluntary Arbitrators
shall have original and exclusive jurisdiction to hear and decide all
unresolved grievances arising from the interpretation or implementation
of the Collective Bargaining Agreement and those arising from the
interpreta-
374
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375
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55 Id.
56 Id., at p. 40.
57 Id., at p. 38.
58 Id., at p. 40.
59 Id., at pp. 42-43.
60 Id., at p. 9.
61 Id., at p. 19.
62 Id., at p. 23.
63 Id.
64 Id., at p. 24.
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65 Id., at p. 335.
66 Id., at pp. 350-387. The May 7, 2006 comment was entitled
“MEMORANDUM.”
67 Id., at p. 351.
68 Id., at pp. 398-408.
69 Id., at p. 45.
378
Section 1. Scope.—
This Rule shall apply to appeals from judgments or final orders
of the Court of Tax Appeals and from awards, judgments, final
orders or resolutions of or authorized by any quasi-judicial agency
in the exercise of its quasi-judicial functions. Among these
agencies are the Civil Service Commission, Central Board of
Assessment Appeals, Securities and Exchange Commission, Office
of the President, Land Registration Authority, Social Security
Commission, Civil Aeronautics Board, Bureau of Patents,
Trademarks and Technology Transfer, National Electrification
Administration, Energy Regulatory Board, National
Telecommunications Commission, Department of Agrarian
Reform under Republic Act No. 6657, Government Service
Insurance System, Employees’ Compensation Commission,
Agricultural Inventions Board, Insurance Commission, Philippine
Atomic Energy Commission, Board of Investments, Construction
Industry Arbitration Commission, and voluntary arbitrators
authorized by law.
....
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A Voluntary Arbitrator or a panel of Voluntary
Arbitrators has the exclusive original jurisdiction over
grievances arising from the interpretation or
implementation of collective bargaining agreements.
Should the parties agree, a Voluntary
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This court then stated that the office of a Voluntary
Arbitrator or a panel of Voluntary Arbitrators, even
assuming that the office is not strictly a quasi-judicial
agency, may be considered an instrumentality, thus:
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70 319 Phil. 262; 249 SCRA 162 (1995) [Per J. Romero, En Banc].
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Since the office of a Voluntary Arbitrator or a panel of
Voluntary Arbitrators is considered a quasi-judicial agency,
this court concluded that a decision or award rendered by a
Voluntary Arbitrator is appealable before the Court of
Appeals. Under Section 9 of the Judiciary Reorganization
Act of 1980, the Court of Appeals has the exclusive original
jurisdiction
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382
Luzon Development Bank was decided in 1995 but
remains “good law.”75 In the 2002 case of Alcantara, Jr. v.
Court of Appeals,76 this court rejected petitioner Santiago
Alcantara, Jr.’s argument that the Rules of Court,
specifically Rule 43, Section 2, superseded the Luzon
Development Bank ruling:
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75 Alcantara, Jr. v. Court of Appeals, 435 Phil. 395, 404; 386 SCRA
370, 379 (2002) [Per J. Kapunan, First Division].
76 Id.
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384
This court has since reiterated the Luzon Development
Bank ruling in its decisions.78
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385
386
The 15-day reglementary period has been upheld by this
court in a long line of cases.80 In AMA Computer College-
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93 Id.
94 Id.
95 Teng v. Pahagac, supra note 78 at p. 184.
96 Rules of Court, Rule 37, Sec. 1.
97 Centro Escolar University Faculty and Allied Workers Union-
Independent v. Court of Appeals, supra note 78 at pp. 437-438; p. 70.
98 Id., at p. 437; p 70.
99 Rules of Court, Rule 65, Sec. 1. Supra note 78 at p. 437; p. 70.
100 Bugarin v. Palisoc, 513 Phil. 59, 66; 476 SCRA 587, 595 (2005)
[Per J. Quisumbing, First Division]; Association of Integrated Security
Force of Bislig (AISFB)-ALU v. Court of Appeals, 505 Phil. 10, 18; 467
SCRA 483, 493 (2005) [Per J. Chico-Nazario, Second Division].
390
the writs issued are null; and (d) when the questioned
order amounts to an oppressive exercise of judicial
authority.”101
In Unicraft Industries International Corporation, et al.
v. The Hon. Court of Appeals,102 petitioners filed a petition
for certiorari against the Voluntary Arbitrator’s decision.
Finding that the Voluntary Arbitrator rendered an award
without giving petitioners an opportunity to present
evidence, this court allowed petitioners’ petition for
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392
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393
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114 Rollo, p. 114. Collective Bargaining Agreement, Art. IX, Sec. 1(e)
provides:
....
(e) An employee whose application for a posted job is accepted shall
hold that job on a trial or observation basis and during that period shall
receive a monthly allowance of an amount in accordance with Section (f) of
this Article. During the trial or observation period which shall not exceed
four (4) months of actual training if the employee isunable [sic] to
demonstrate his ability to perform the work, he shall be reverted to his
previous assignment and the last preceding rate of pay but shall not, for a
period of three (3) months, be permitted to apply for any posted job in the
same higher classification. On the other hand, should the employee be
considered capable of holding the job, he shall, subject to prior approval of
the authorized management official, be appointed to the position in a
regular capacity. Positions vacated during the trial or observation period
shall be filled up by temporary employees hired for this purpose only, if
necessary.
115 Id.
116 Id.
117 Id.
394
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118 356 Phil. 480; 295 SCRA 171 (1998) [Per J. Romero, Third
Division].
119 Id., at p. 491; p. 183.
120 Id., at p. 490; p. 182.
121 Id.
122 Labor Code, Art. 252 provides:
Art. 252. Meaning of duty to bargain collectively.—The duty to
bargain collectively means the performance of a mutual obligation to meet
and convene promptly and expeditiously in good faith for the purpose of
negotiating an agreement with respect to wages, hours of work and all
other terms and condi-
395
negotiated and settled with PWU before the actual signing of the
CBA on September 27. Instead, PHILEC, again, allowed the
provisions of Art. X, Sec. 4 of the CBA to remain the way it is and
is now suffering the consequences of its laches.123 (Emphasis in
the original)
We note that PHILEC did not dispute PWU’s contention
that it selected several rank-and-file employees for training
and paid them training allowance based on the schedule
provided in the collective bargaining agreement effective at
the time of the trainees’ selection.124 PHILEC cannot
choose when and to whom to apply the provisions of its
collective bargaining agreement. The provisions of a
collective bargaining agreement must be applied uniformly
and complied with in good faith.
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Considering that Voluntary Arbitrator Jimenez’s
decision awarded sums of money, Lipio and Ignacio, Sr. are
entitled to legal interest on their training allowances.
Voluntary Arbitrator Jimenez’s decision having become
final and executory on August 22, 2000, PHILEC is liable
for legal interest equal to 12% per annum from finality of
the decision until full payment as this court ruled in
Eastern Shipping Lines, Inc. v. Court of Appeals:125
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125 G.R. No. 97412, July 12, 1994, 234 SCRA 78 [Per J. Vitug, En
Banc].
397
The 6% legal interest under Circular No. 799, Series of
2013, of the Bangko Sentral ng Pilipinas Monetary Board
shall not apply, Voluntary Arbitrator Jimenez’s decision
having become final and executory prior to the effectivity of
the circular on July 1, 2013. In Nacar v. Gallery Frames,127
we held that:
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WHEREFORE, the petition for review on certiorari is
DENIED. The Court of Appeals’ decision dated May 25,
2004 is AFFIRMED.
Petitioner Philippine Electric Corporation is
ORDERED to PAY respondent Eleodoro V. Lipio a total of
P3,549.00 for a four (4)-month training for the position of
Foreman I with legal interest of 12% per annum from
August 22, 2000 until the amount’s full satisfaction.
For respondent Emerlito C. Ignacio, Sr., Philippine
Electric Corporation is ORDERED to PAY a total of
P3,962.00 for a four (4)-month training for the position of
Foreman I with legal interest of 12% per annum from
August 22, 2000 until the amount’s full satisfaction.
SO ORDERED.
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