Samahan ng Manggagawa sa Top Form Manufacturing (SMTFM-UWP) v. NLRC

Topics: CBA interpretation and Minutes of registration

FACTS:

Petitioner Samahang Manggagawa sa Top Form Manufacturing — United Workers of the Philippines (SMTFM) was the certified collective bargaining representative of all regular rank and file employees of private respondent Top Form Manufacturing Philippines, Inc. At the collective bargaining negotiation held at the Milky Way Restaurant in Makati, Metro Manila on February 27, 1990, the parties agreed to discuss unresolved economic issues. According to the minutes of the meeting, Article VII of the collective bargaining agreement was discussed.

RTWPB-NCR issued Wage Order No. 01 granting an increase of P17.00 per day in the salary of workers. This was followed by Wage Order No. 02 dated December 20, 1990 providing for a P12.00 daily increase in salary.

As expected, the union requested the implementation of said wage orders. However, they demanded that the increase be on an across-the-board basis. Private respondent refused to accede to that demand. Instead, it implemented a scheme of increases purportedly to avoid wage distortion. Thus, private respondent granted the P17.00 increase under Wage Order No. 01 to workers/employees receiving salary of P125.00 per day and below. The P12.00 increase mandated by Wage Order No. 02 was granted to those receiving the salary of P140.00 per day and below. For employees receiving salary higher than P125.00 or P140.00 per day, private respondent granted an escalated increase ranging from P6.99 to P14.30 and from P6.00 to P10.00, respectively.

The union, through its legal counsel, wrote private respondent a letter demanding that it should “fulfill its pledge of sincerity to the union by granting an across-the-board wage increases (sic) to all employees under the wage orders.” The union reiterated that it had agreed to “retain the old provision of CBA” on the strength of private respondent’s “promise and assurance” of an across-the-board salary increase should the government mandate salary increases. Several conferences between the parties notwithstanding, private respondent adamantly maintained its position on the salary increases it had granted that were purportedly designed to avoid wage distortion.

Consequently, the union filed a complaint with the NCR NLRC alleging that private respondent’s act of “reneging on its undertaking/promise clearly constitutes act of unfair labor practice through bargaining in bad faith.” It charged private respondent with acts of unfair labor practices or violation of Article 247 of the Labor Code, as amended, specifically “bargaining in bad faith,” and prayed that it be awarded actual, moral and exemplary damages. In its position paper, the union added that it was charging private respondent with “violation of Article 100 of the Labor Code.”

Private respondent, on the other hand, contended that in implementing Wage Orders Nos. 01 and 02, it had avoided “the existence of a wage distortion” that would arise from such implementation. It emphasized that only “after a reasonable length of time from the implementation” of the wage orders “that the union surprisingly raised the question that the company should have implemented said wage orders on an across-the-board basis.” It asserted that there was no agreement to the effect that future wage increases mandated by the government should be implemented on an across-the-board basis. Otherwise, that agreement would have been incorporated and expressly stipulated in the CBA.

Labor Arbiter Jose G. de Vera rendered a decision dismissing the complaint for lack of merit.

Union appealed to the NLRC that, in turn, promulgated the assailed Resolution of April 29, 1993 9 dismissing the appeal for lack of merit. Still dissatisfied, petitioner sought reconsideration which, however, was denied by the NLRC in the Resolution dated January 17, 1994. Hence, the instant petition for certiorari

ISSUE: whether or not an employer committed an unfair labor practice by bargaining in bad faith and discriminating against its employees.

RULING:

To start with, if there was indeed a promise or undertaking on the part of private respondent to obligate itself to grant an automatic across-the-board wage increase, petitioner union should have requested or demanded that such “promise or undertaking” be incorporated in the CBA. After all, petitioner union has the means under the law to compel private respondent to incorporate this specific economic proposal in the CBA.

It could have invoked Article 252 of the Labor Code defining “duty to bargain,” Thus, the duty includes “executing a contract incorporating such agreements if requested by either party.” Petitioner union’s assertion that it had insisted on the incorporation of the same proposal may have a factual basis considering the allegations in the aforementioned joint affidavit of its members.

However, Article 252 also states that the duty to bargain “does not compel any party to agree to a proposal or make any concession.”

Thus, petitioner union may not validly claim that the proposal embodied in the Minutes of the negotiation forms part of the CBA that it finally entered into with private respondent.