PHILIPPINE AIRLINES, INC., petitioner, vs., NATIONAL LABOR RELATIONS COMMISSION, FERDINAND PINEDA and GODOFREDO CABLING,respondents.

DECISION
MARTINEZ, J.: Can the National Labor Relations Commission (NLRC), even without a complaint for illegal dismissal filed before the labor arbiter, entertain an action for injunction and issue such writ enjoining petitioner Philippine Airlines, Inc. from enforcing its Orders of dismissal against private respondents, and ordering petitioner to reinstate the private respondents to their previous positions? This is the pivotal issue presented before us in this petition for certiorari under Rule 65 of the Revised Rules of Court which seeks the nullification of the injunctive writ dated April 3,1995 issued by the NLRC and the Order denying petitioner's motion for reconsideration on the ground that the said Orders were issued in excess of jurisdiction. Private respondents are flight stewards of the petitioner. Both were dismissed from the service for their alleged involvement in the April 3, 1993 currency smuggling in Hong Kong. Aggrieved by said dismissal, private respondents filed with the NLRC a petition [1] for injunction praying that:

"I. Upon filing of this Petition, a temporary restraining order be issued, prohibiting respondents (petitioner herein) from effecting or enforcing the Decision dated Feb. 22, 1995, or to reinstate petitioners temporarily while a hearing on the propriety of the issuance of a writ of preliminary injunction is being undertaken; "II. After hearing, a writ of preliminary mandatory injunction be issued ordering respondent to reinstate petitioners to their former positions pending the hearing of this case, or, prohibiting respondent from enforcing its Decision dated February 22,1995 while this case is pending adjudication; "III. After hearing, that the writ of preliminary injunction as to the reliefs sought for be made permanent, that petitioners be awarded full backwages, moral damages of PHP 500,000.00 each and exemplary damages of PHP 500,000.00 each, attorneys fees equivalent to ten percent of whatever amount is awarded, and the costs of suit."

On April 3, 1995, the NLRC issued a temporary mandatory injunction [2] enjoining petitioner to cease and desist from enforcing its February 22, 1995 Memorandum of dismissal. In granting the writ, the NLRC considered the following facts, to wit:

x x x that almost two (2) years ago, i.e. on April 15, 1993, the petitioners were instructed to attend an investigation by respondents Security and Fraud Prevention Sub-Department regarding an April 3, 1993 incident in Hongkong at which Joseph Abaca, respondents Avionics Mechanic in Hongkong was intercepted by the Hongkong Airport Police at Gate 05 xxx the ramp area of the Kai Tak International Airport while xxx about to exit said gate carrying a xxx bag said to contain some 2.5 million pesos in Philippine Currencies. That at the Police Station, Mr. Abaca claimed that he just found said plastic bag at the Skybed Section of the arrival flight PR300/03 April 93, where petitioners served as flight stewards of said flight PR300; x x the petitioners sought a more detailed account of what this HKG incident is all about; but instead, the petitioners were administratively charged, a hearing on which did not push through until almost two (2) years after, i.e. on January 20, 1995 xxx where a confrontation between Mr. Abaca and petitioners herein was compulsorily arranged by the respondents disciplinary board at which hearing, Abaca was made to identify petitioners as co-conspirators; that despite the fact that the procedure of identification adopted by respondents Disciplinary Board was anomalous as there was no one else in the line-up (which could not be called one) but petitioners xxx Joseph Abaca still had difficulty in identifying petitioner Pineda as his co-conspirator, and as to petitioner Cabling, he was implicated and pointed by Abaca only after respondents Atty. Cabatuando pressed the former to identify petitioner Cabling as co-conspirator; that with the hearing reset to January 25, 1995, Mr. Joseph Abaca finally gave exculpating statements to the board in that he cleared petitioners from any participation or from being the owners of the currencies, and at which hearing Mr. Joseph Abaca volunteered the information that the real owner of said money was one who frequented his headquarters in Hongkong to which information, the Disciplinary Board Chairman, Mr. Ismael Khan, opined for the need for another hearing to go to the bottom of the incident; that from said statement, it appeared that Mr. Joseph Abaca was the courier, and had another mechanic in Manila who hid the currency at the planes skybed for Abaca to retrieve in Hongkong, which findings of how the money was found was previously confirmed by Mr. Joseph Abaca himself when he was first investigated by the Hongkong authorities; that just as petitioners thought that they were already fully cleared of the charges, as they no longer received any summons/notices on the intended additional hearings mandated by the Disciplinary Board, they were surprised to receive on February 23, 1995 xxx a Memorandum dated February 22, 1995 terminating their services for

alleged violation of respondents Code of Discipline effective immediately; that sometime xxx first week of March, 1995, petitioner Pineda received another Memorandum from respondent Mr. Juan Paraiso, advising him of his termination effective February 3, 1995, likewise for violation of respondents Code of Discipline; x x x"
In support of the issuance of the writ of temporary injunction, the NLRC adopted the view that: (1) private respondents cannot be validly dismissed on the strength of petitioner's Code of Discipline which was declared illegal by this Court in the case of PAL, Inc. vs. NLRC, (G.R. No. 85985), promulgated August 13, 1993, for the reason that it was formulated by the petitioner without the participation of its employees as required in R.A. 6715, amending Article 211 of the Labor Code; (2) the whimsical, baseless and premature dismissals of private respondents which "caused them grave and irreparable injury" is enjoinable as private respondents are left "with no speedy and adequate remedy at law'"except the issuance of a temporary mandatory injunction; (3) the NLRC is empowered under Article 218 (e) of the Labor Code not only to restrain any actual or threatened commission of any or all prohibited or unlawful acts but also to require the performance of a particular act in any labor dispute, which, if not restrained or performed forthwith, may cause grave or irreparable damage to any party; and (4) the temporary mandatory power of the NLRC was recognized by this Court in the case of Chemo-Technicshe Mfg., Inc. Employees Union,DFA, et.al. vs. Chemo-Technische Mfg., Inc. [G.R. No. 107031, January 25,1993]. On May 4,1995, petitioner moved for reconsideration[3] arguing that the NLRC erred:

1. in granting a temporary injunction order when it has no jurisdiction to issue an injunction or restraining order since this may be issued only under Article 218 of the Labor Code if the case involves or arises from labor disputes; 2. in granting a temporary injunction order when the termination of private respondents have long been carried out; 3. ..in ordering the reinstatement of private respondents on the basis of their mere allegations, in violation of PAL's right to due process; 4. ..in arrogating unto itself management prerogative to discipline its employees and divesting the labor arbiter of its original and exclusive jurisdiction over illegal dismissal cases; 5. ..in suspending the effects of termination when such action is exclusively within the jurisdiction of the Secretary of Labor;

6. ..in issuing the temporary injunction in the absence of any irreparable or substantial injury to both private respondents.
On May 31,1995, the NLRC denied petitioner's motion for reconsideration, ruling:

The respondent (now petitioner), for one, cannot validly claim that we cannot exercise our injunctive power under Article 218 (e) of the Labor Code on the pretext that what we have here is not a labor dispute as long as it concedes that as defined by law, a(l) Labor Dispute includes any controversy or matter concerning terms or conditions of employment. . If security of tenure, which has been breached by respondent and which, precisely, is sought to be protected by our temporary mandatory injunction (the core of controversy in this case) is not a term or condition of employment, what then is? xxx xxx xxx Anent respondents second argument x x x, Article 218 (e) of the Labor Code x x x empowered the Commission not only to issue a prohibitory injunction, but a mandatory (to require the performance) one as well. Besides, as earlier discussed, we already exercised (on August 23,1991) this temporary mandatory injunctive power in the case of ChemoTechnische Mfg., Inc. Employees Union-DFA et.al. vs. Chemo-Technishe Mfg., Inc., et. al. (supra) and effectively enjoined one (1) month old dismissals by Chemo-Technische and that our aforesaid mandatory exercise of injunctive power, when questioned through a petition for certiorari, was sustained by the Third Division of the Supreme court per its Resolution dated January 25,1993. xxx xxx xxx Respondents fourth argument that petitioner's remedy for their dismissals is 'to file an illegal dismissal case against PAL which cases are within the original and exclusive jurisdiction of the Labor Arbiter' is ignorant. In requiring as a condition for the issuance of a 'temporary or permanent injunction'- '(4) That complainant has no adequate remedy at law;' Article 218 (e) of the Labor Code clearly envisioned adequacy , and not plain availability of a remedy at law as an alternative bar to the issuance of an injunction. An illegal dismissal suit (which takes, on its expeditious side, three (3) years before it can be disposed of) while available as a remedy under Article 217 (a) of the Labor Code, is certainly not an 'adequate; remedy at law. Ergo, it cannot, as an

alternative remedy, bar our exercise of that injunctive power given us by Article 218 (e) of the Code. xxx xxx xxx

Thus, Article 218 (e), as earlier discussed [which empowers this Commission 'to require the performance of a particular act' (such as our requiring respondent 'to cease and desist from enforcing' its whimsical memoranda of dismissals and 'instead to reinstate petitioners to their respective position held prior to their subject dismissals') in 'any labor dispute which, if not xxx performed forthwith, may cause grave and irreparable damage to any party'] stands as the sole 'adequate remedy at law' for petitioners here. Finally, the respondent, in its sixth argument claims that even if its acts of dismissing petitioners 'may be great, still the same is capable of compensation', and that consequently, 'injunction need not be issued where adequate compensation at law could be obtained'. Actually, what respondent PAL argues here is that we need not interfere in its whimsical dismissals of petitioners as, after all, it can pay the latter its backwages. x x x
But just the same, we have to stress that Article 279 does not speak alone of backwages as an obtainable relief for illegal dismissal; that reinstatement as well is the concern of said law, enforceable when necessary, through Article 218 (e) of the Labor Code (without need of an illegal dismissal suit under Article 217 (a) of the Code) if such whimsical and capricious act of illegal dismissal will 'cause grave or irreparable injury to a party'. x x x " [4] Hence, the present recourse. Generally, injunction is a preservative remedy for the protection of one's substantive rights or interest. It is not a cause of action in itself but merely a provisional remedy, an adjunct to a main suit. It is resorted to only when there is a pressing necessity to avoid injurious consequences which cannot be remedied under any standard of compensation. The application of the injunctive writ rests upon the existence of an emergency or of a special reason before the main case be regularly heard. The essential conditions for granting such temporary injunctive relief are that the complaint alleges facts which appear to be sufficient to constitute a proper basis for injunction and that on the entire showing from the contending parties, the injunction is reasonably necessary to protect the legal rights of the plaintiff pending the litigation. [5] Injunction is also a special equitable relief granted only in cases where there is no plain, adequate and complete remedy at law.[6] In labor cases, Article 218 of the Labor Code empowers the NLRC-

"(e) To enjoin or restrain any actual or threatened commission of any or all prohibited or unlawful acts or to require the performance of a particular act in any labor dispute which, if not restrained or performed forthwith, may cause grave or irreparable damage to any party or render ineffectual any decision in favor of such party; x x x." (Emphasis Ours)
Complementing the above-quoted provision, Sec. 1, Rule XI of the New Rules of Procedure of the NLRC, pertinently provides as follows:

"Section 1. Injunction in Ordinary Labor Dispute.-A preliminary injunction or a restraining order may be granted by the Commission through its divisions pursuant to the provisions of paragraph (e) of Article 218 of the Labor Code, as amended, when it is established on the bases of the sworn allegations in the
petition that the acts complained of, involving or arising from any labor dispute before the Commission, which, if not restrained or performed forthwith, may cause grave or irreparable damage to any party or render ineffectual any decision in favor of such party.

xxx

xxx

xxx

The foregoing ancillary power may be exercised by the Labor Arbiters only as an incident to the cases pending before them in order to preserve the rights of the parties during the pendency of the case, but excluding labor disputes involving strikes or lockout. [7] (Emphasis Ours) From the foregoing provisions of law, the power of the NLRC to issue an injunctive writ originates from "any labor dispute" upon application by a party thereof, which application if not granted "may cause grave or irreparable damage to any party or render ineffectual any decision in favor of such party." The term "labor dispute" is defined as "any controversy or matter concerning terms and conditions of employment or the association or representation of persons in negotiating, fixing, maintaining, changing, or arranging the terms and conditions of employment regardless of whether or not the disputants stand in the proximate relation of employers and employees."[8] The term "controversy" is likewise defined as "a litigated question; adversary proceeding in a court of law; a civil action or suit, either at law or in equity; a justiciable dispute."[9] A "justiciable controversy" is "one involving an active antagonistic assertion of a legal right on one side and a denial thereof on the other concerning a real, and not a mere theoretical question or issue."[10] Taking into account the foregoing definitions, it is an essential requirement that there must first be a labor dispute between the contending parties before the labor arbiter. In the present case, there is no labor dispute between the petitioner and

private respondents as there has yet been no complaint for illegal dismissal filed with the labor arbiter by the private respondents against the petitioner. The petition for injunction directly filed before the NLRC is in reality an action for illegal dismissal. This is clear from the allegations in the petition which prays for: reinstatement of private respondents; award of full backwages, moral and exemplary damages; and attorney's fees. As such, the petition should have been filed with the labor arbiter who has the original and exclusive jurisdiction to hear and decide the following cases involving all workers, whether agricultural or non-agricultural:

(1) Unfair labor practice; (2) Termination disputes; (3) If accompanied with a claim for reinstatement, those cases that workers may file involving wages, rates of pay, hours of work and other terms and conditions of employment; (4) Claims for actual, moral, exemplary and other forms of damages arising from the employer-employee relations; (5) Cases arising from any violation of Article 264 of this Code, including questions involving the legality of strikes and lockouts; and
(6) Except claims for employees compensation, social security, medicare and maternity benefits, all other claims arising from employer-employee relations, including those of persons in domestic or household service, involving an amount exceeding five thousand pesos (P 5,000.00), whether or not accompanied with a claim for reinstatement. [11] The jurisdiction conferred by the foregoing legal provision to the labor arbiter is both original and exclusive, meaning, no other officer or tribunal can take cognizance of, hear and decide any of the cases therein enumerated. The only exceptions are where the Secretary of Labor and Employment or the NLRC exercises the power of compulsory arbitration, or the parties agree to submit the matter to voluntary arbitration pursuant to Article 263 (g) of the Labor Code, the pertinent portions of which reads:

"(g) When, in his opinion, there exists a labor dispute causing or likely to cause a strike or lockout in an industry indispensable to the national interest, the Secretary of Labor and Employment may assume jurisdiction over the dispute and decide it or certify the same to the Commission for compulsory arbitration. Such assumption or certification shall have the effect of automatically enjoining the intended or impending strike or lockout as specified in the assumption or certification order. If one has already taken place at the time of assumption or certification, all striking or locked out

employees shall immediately resume operations and readmit all workers under the same terms and conditions prevailing before the strike or lockout. The Secretary of Labor and Employment or the Commission may seek the assistance of law enforcement agencies to ensure compliance with this provision as well as with such orders as he may issue to enforce the same. xxx xxx xxx"

On the other hand, the NLRC shall have exclusive appellate jurisdiction over all cases decided by labor arbiters as provided in Article 217(b) of the Labor Code. In short, the jurisdiction of the NLRC in illegal dismissal cases is appellate in nature and, therefore, it cannot entertain the private respondents' petition for injunction which challenges the dismissal orders of petitioner. Article 218(e) of the Labor Code does not provide blanket authority to the NLRC or any of its divisions to issue writs of injunction, considering that Section 1 of Rule XI of the New Rules of Procedure of the NLRC makes injunction only an ancillary remedy in ordinary labor disputes" [12] Thus, the NLRC exceeded its jurisdiction when it issued the assailed Order granting private respondents' petition for injunction and ordering the petitioner to reinstate private respondents. The argument of the NLRC in its assailed Order that to file an illegal dismissal suit with the labor arbiter is not an "adequate" remedy since it takes three (3) years before it can be disposed of, is patently erroneous. An "adequate" remedy at law has been defined as one "that affords relief with reference to the matter in controversy, and which is appropriate to the particular circumstances of the case." [13] It is a remedy which is equally beneficial, speedy and sufficient which will promptly relieve the petitioner from the injurious effects of the acts complained of.[14] Under the Labor Code, the ordinary and proper recourse of an illegally dismissed employee is to file a complaint for illegal dismissal with the labor arbiter. [15] In the case at bar, private respondents disregarded this rule and directly went to the NLRC through a petition for injunction praying that petitioner be enjoined from enforcing its dismissal orders. In Lamb vs. Phipps,[16] we ruled that if the remedy is specifically provided by law, it is presumed to be adequate. Moreover, the preliminary mandatory injunction prayed for by the private respondents in their petition before the NLRC can also be entertained by the labor arbiter who, as shown earlier, has the ancillary power to issue preliminary injunctions or restraining orders as an incident in the cases pending before him in order to preserve the rights of the parties during the pendency of the case.[17] Furthermore, an examination of private respondents' petition for injunction reveals that it has no basis since there is no showing of any urgency or irreparable injury which the private respondents might suffer. An injury is considered irreparable if it is of such constant and frequent recurrence that no fair and reasonable redress can be had therefor in a court of law,[18] or where there is no standard by which their amount can be measured with reasonable accuracy, that is, it is not susceptible of mathematical computation. It is considered irreparable injury when it cannot be adequately

compensated in damages due to the nature of the injury itself or the nature of the right or property injured or when there exists no certain pecuniary standard for the measurement of damages.[19] In the case at bar, the alleged injury which private respondents stand to suffer by reason of their alleged illegal dismissal can be adequately compensated and therefore, there exists no "irreparable injury," as defined above which would necessitate the issuance of the injunction sought for. Article 279 of the Labor Code provides that an employee who is unjustly dismissed from employment shall be entitled to reinstatement, without loss of seniority rights and other privileges, and to the payment of full backwages, inclusive of allowances, and to other benefits or their monetary equivalent computed from the time his compensation was withheld from him up to the time of his actual reinstatement. The ruling of the NLRC that the Supreme Court upheld its power to issue temporary mandatory injunction orders in the case of Chemo-Technische Mfg., Inc. Employees Union-DFA, et.al. vs. Chemo-Technische Mfg., Inc. et.al., docketed as G.R. No. 107031, is misleading. As correctly argued by the petitioner, no such pronouncement was made by this Court in said case. On January 25,1993, we issued a Minute Resolution in the subject case stating as follows:

"Considering the allegations contained, the issues raised and the arguments adduced in the petition for certiorari , as well as the comments of both public and private respondents thereon, and the reply of the petitioners to private respondent's motion to dismiss the petition, the Court Resolved to DENY the same for being premature."
It is clear from the above resolution that we did not in anyway sustain the action of the NLRC in issuing such temporary mandatory injunction but rather we dismissed the petition as the NLRC had yet to rule upon the motion for reconsideration filed by peitioner. Thus, the minute resolution denying the petition for being prematurely filed. Finally, an injunction, as an extraordinary remedy, is not favored in labor law considering that it generally has not proved to be an effective means of settling labor disputes.[20] It has been the policy of the State to encourage the parties to use the nonjudicial process of negotiation and compromise, mediation and arbitration. [21] Thus, injunctions may be issued only in cases of extreme necessity based on legal grounds clearly established, after due consultations or hearing and when all efforts at conciliation are exhausted which factors, however, are clearly absent in the present case. WHEREFORE, the petition is hereby GRANTED. The assailed Orders dated April 3,1995 and May 31,1995, issued by the National Labor Relations Commission (First Division), in NLRC NCR IC No. 000563-95, are hereby REVERSED and SET ASIDE. SO ORDERED. Regalado (Chairman), Melo, Puno, and Mendoza, JJ., concur.

PRUDENTIAL BANK and TRUST COMPANY, petitioner, vs. CLARITA T. REYES, respondent. DECISION
GONZAGA-REYES, J.:

Before the Court is a petition for review on certiorari of the Decision,[1] dated October 15, 1999 of the Court of Appeals in C.A.-G.R. SP No. 30607 and of its Resolution, dated December 6, 1999 denying petitioners motion for reconsideration of said decision. The Court of Appeals reversed and set aside the resolution[2] of the National Labor Relations Commission (NLRC) in NLRC NCR CA No. 009364-95, reversing and setting aside the labor arbiters decision and dismissing for lack of merit private respondents complaint.[3] The case stems from NLRC NCR Case No. 00-06-03462-92, which is a complaint for illegal suspension and illegal dismissal with prayer for moral and exemplary damages, gratuity, fringe benefits and attorneys fees filed by Clarita Tan Reyes against Prudential Bank and Trust Company (the Bank) before the labor arbiter. Prior to her dismissal, private respondent Reyes held the position of Assistant Vice President in the foreign department of the Bank, tasked with the duties, among others, to collect checks drawn against overseas banks payable in foreign currency and to ensure the collection of foreign bills or checks purchased, including the signing of transmittal letters covering the same. After proceedings duly undertaken by the parties, judgment was rendered by Labor Arbiter Cornelio L. Linsangan, the dispositive portion of which reads:

WHEREFORE, finding the dismissal of complainant to be without factual and legal basis, judgment is hereby rendered ordering the respondent bank to pay her back wages for three (3) years in the amount of P540,000.00 (P15,000.00 x 36 mos.). In lieu of reinstatement, the respondent is also ordered to pay complainant separation pay equivalent to one month salary for every year of service, in the amount of P420,000.00 (P15,000 x 28 mos.). In addition, the respondent should also pay complainant profit sharing and unpaid fringe benefits. Attorneys fees equivalent to ten (10%) percent of the total award should likewise be paid by respondent. SO ORDERED.[4]
Not satisfied, the Bank appealed to the NLRC which, as mentioned at the outset, reversed the Labor Arbiters decision in its Resolution dated 24 March 1997. Private respondent sought

reconsideration which, however, was denied by the NLRC in its Resolution of 28 July 1998. Aggrieved, private respondent commenced on October 28, 1998, a petition for certiorari before the Supreme Court.[5] The subject petition was referred to the Court of Appeals for appropriate action and disposition per resolution of this Court dated November 25, 1998, in accordance with the ruling in St. Martin Funeral Homes vs. NLRC.[6] In its assailed decision, the Court of Appeals adopted the following antecedent facts leading to Reyess dismissal as summarized by the NLRC:

The auditors of the Bank discovered that two checks, No. 011728-7232-146, in the amount of US$109,650.00, and No. 011730-7232-146, in the amount of US$115,000.00, received by the Bank on April 6, 1989, drawn by the Sanford Trading against Hongkong and Shanghai Banking Corporation, Jurong Branch, Singapore, in favor of Filipinas Tyrom, were not sent out for collection to Hongkong Shanghai Banking Corporation on the alleged order of the complainant until the said checks became stale. The Bank created a committee to investigate the findings of the auditors involving the two checks which were not collected and became stale. On March 8, 1991, the president of the Bank issued a memorandum to the complainant informing her of the findings of the auditors and asked her to give her side. In reply, complainant requested for an extension of one week to submit her explanation. In a subsequent letter, dated March 14, 1991, to the president, complainant stated that in view of the refusal of the Bank that she be furnished copies of the pertinent documents she is requesting and the refusal to grant her a reasonable period to prepare her answer, she was constrained to make a general denial of any misfeasance or malfeasance on her part and asked that a formal investigation be made. As the complainant failed to attend and participate in the formal investigation conducted by the Committee on May 24, 1991, despite due notice, the Committee proceeded with its hearings and heard the testimonies of several witnesses. The Committees findings were: a) The two (2) HSBC checks were received by the Foreign Department on 6 April 1989. On the same day, complainant authorized the crediting of the account of Filipinas Tyrom in the amount of P4,780,102.70 corresponding to the face value of the checks, (Exhibits 6, 22 to 22-A and 23 to 23-A). On the following day, a transmittal letter was prepared by Ms. Cecilia Joven, a remittance clerk then assigned in the Foreign Department, for the purpose of sending out the two (2) HSBC checks for collection. She then requested complainant to sign the said transmittal letters (Exhibits 1, 7 and 25; TSN, 11 March 1993, pp. 42-52), as it is complainant who

gives her instructions directly concerning the transmittal of foreign bills purchased. All other transmittal letters are in fact signed by complainant. b) After Ms. Joven delivered the transmittal letters and the checks to the Accounting Section of the Foreign Department, complainant instructed her to withdraw the same for the purpose of changing the addressee thereon from American Express Bank to Bank of Hawaii (ibid.) under a special collection scheme (Exhibits 4 and 5 to 5-B). c) After complying with complainants instruction, Ms. Joven then returned to complainant for the latter to sign the new transmittal letters. However, complainant told Ms. Joven to just hold on to the letters and checks and await further instructions (ibid.). Thus, the new transmittal letters remained unsigned. (See Exhibits 5 to 5-B). d) In June 1989, Ms. Joven was transferred to another department. Hence, her duties, responsibilities and functions, including the responsibility over the two (2) HSBC checks, were turned over to another remittance clerk, Ms. Analisa Castillo (Exhibit 14; TSN, 4 June 1993, pp. 27-29). e) When asked by Ms. Castillo about the two (2) HSBC checks, Ms. Joven relayed to the latter complainants instruction (Exhibit 14; TSN, 4 June 1993, p. 42). f) About fifteen (15) months after the HSBC checks were received by the Bank, the said checks were discovered in the course of an audit conducted by the Bank s auditors. Atty. Pablo Magno, the Banks legal counsel, advised complainant to send the checks for collection despite the lapse of fifteen (15) months. g) Complainant, however, deliberately withheld Atty. Magnos advice from her superior, the Senior Vice-President, Mr. Renato Santos and falsely informed the latter that Atty. Magno advised that a demand letter be sent instead, thereby further delaying the collection of the HSBC checks. h) On 10 July 1990, the HSBC checks were finally sent for collection, but were returned on 16 July 1990 for the reason account closed (Exhibits 2 -A and 3-A). After a review of the Committees findings, the Board of Directors of the Bank resolved not to re-elect complainant any longer to the position of assistant president pursuant to the Banks By-laws. On July 19, 1991, complainant was informed of her termination of employment from the Bank by Senior Vice President Benedicto L. Santos, in a letter the text of which is quoted in full:

Dear Mrs. Reyes: After a thorough investigation and appreciation of the charges against you as contained in the Memorandum of the President dated March 8, 1991, the Fact Finding Committee which was created to investigate the commission and/or omission of the acts alluded therein, has found the following: 1. You have deliberately held the clearing of Checks Nos. 11728 and 11730 of Hongkong and Shanghai Banking Corporation in the total amount of US$224,650.00 by giving instructions to the collection clerk not to send the checks for collection. In view thereof, when the said checks were finally sent to clearing after the lapse of 15 months from receipt of said checks, they were returned for the reason Account closed. To date, the value of said checks have not been paid by Filipinas Tyrom, which as payee of the checks, had been credited with their peso equivalent; 2. You tried to influence the decision of Atty. Pablo P. Magno, Bank legal counsel, by asking him to do something allegedly upon instructions of a Senior Vice President of the Bank or else lose his job when in truth and in fact no such instructions was given; and 3. You deliberately withheld from Mr. Santos, Senior Vice President, the advice given by the legal counsel of the Bank which Mr. Santos had asked you to seek. As a matter of fact, you even relayed a false advice which delayed further the sending of the two checks for collection. Likewise, you refused to heed the advice of the Banks legal counsel to send the checks for collection. These findings have given rise to the Banks loss of trust and confidence in you, the same being acts of serious misconduct in the performance of your duties resulting in monetary loss to the Bank. In view thereof, the Board has resolved not to re-elect you to the position of Assistant Vice President of the Bank. Accordingly, your services are terminated effective immediately. In relation thereto, your monetary and retirement benefits are forfeited except those that have vested in you. In her position paper, complainant alleged that the real reason for her dismissal was her filing of the criminal cases against the bank president, the vice president and the auditors of the Bank, such filing not being a valid ground for her dismissal. Furthermore, she alleged that it would be self-serving for the respondent to state that she was found guilty of gross misconduct in deliberately withholding the clearing of the two dollar checks. She further alleged that she was not afforded due process as she was not given the chance to refute the charges mentioned in the letter of dismissal. Hence, she was illegally dismissed.

On the other hand, respondent argues that there were substantial bases for the Bank to lose its trust and confidence on the complainant and, accordingly, had just cause for terminating her services. Moreover, for filing the clearly unfounded suit against the respondents officers, complainant is liable to pay moral and exemplary damages and attorneys fees.[7]
The Court of Appeals found that the NLRC committed grave abuse of discretion in ruling that the dismissal of Reyes is valid. In effect, the Court of Appeals reinstated the judgment of the labor arbiter with modification as follows:

WHEREFORE, in the light of the foregoing, the decision appealed from is hereby REVERSED and SET ASIDE. In lieu thereof, judgment is hereby rendered ordering respondent Bank as follows:
1. To pay petitioner full backwages and other benefits from July 19, 1991 up to the finality of this judgment; 2. To pay petitioner separation pay equivalent to one (1) month salary for every year of service in lieu of reinstatement; and 3. To pay attorneys fee equivalent to ten (10%) percent of the total award.

SO ORDERED.[8]
Hence, the Banks recourse to this Court contending in its memorandum that:

IN SETTING ASIDE THE DECISION DATED 24 MARCH 1997 AND THE RESOLUTION DATED 28 JULY 1998 OF THE NLRC AND REINSTATING WITH MODIFICATION THE DECISION DATED 20 JULY 1995 OF LABOR ARBITER CORNELIO L. LINSANGAN, THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED, IN VIEW OF THE FOLLOWING:
I.

IT IS THE SEC (NOW THE REGIONAL TRIAL COURT) AND NOT THE NLRC WHICH HAS ORIGINAL AND EXCLUSIVE JURISDICTION OVER CASES INVOLVING THE REMOVAL FROM OFFICE OF CORPORATE OFFICERS.
II.

EVEN ASSUMING ARGUENDO THAT THE NLRC HAS JURISDICTION, THERE WAS SUBSTANTIAL EVIDENCE OF RESPONDENTS MISCONDUCT JUSTIFYING THE BANKS LOSS OF TRUST AND CONFIDENCE ON (sic) HER.
III.

EVEN ASSUMING ARGUENDO THAT RESPONDENT WAS ENTITLED TO BACKWAGES, THE HONORABLE COURT OF APPEALS ERRED IN AWARDING UNLIMITED AND UNQUALIFIED BACKWAGES THEREBY GOING FAR BEYOND THE LABOR ARBITERS DECISION LIMITING THE SAME TO THREE YEARS, WHICH DECISION RESPONDENT HERSELF SOUGHT TO EXECUTE.[9]
In sum, the resolution of this petition hinges on (1) whether the NLRC has jurisdiction over the complaint for illegal dismissal; (2) whether complainant Reyes was illegally dismissed; and (3) whether the amount of back wages awarded was proper. On the first issue, petitioner seeks refuge behind the argument that the dispute is an intracorporate controversy concerning as it does the non-election of private respondent to the position of Assistant Vice-President of the Bank which falls under the exclusive and original jurisdiction of the Securities and Exchange Commission (now the Regional Trial Court) under Section 5 of Presidential Decree No. 902-A. More specifically, petitioner contends that complainant is a corporate officer, an elective position under the corporate by-laws and her non-election is an intra-corporate controversy cognizable by the SEC invoking lengthily a number of this Courts decisions.[10] Petitioner Bank can no longer raise the issue of jurisdiction under the principle of estoppel. The Bank participated in the proceedings from start to finish. It filed its position paper with the Labor Arbiter. When the decision of the Labor Arbiter was adverse to it, the Bank appealed to the NLRC. When the NLRC decided in its favor, the bank said nothing about jurisdiction. Even before the Court of Appeals, it never questioned the proceedings on the ground of lack of jurisdiction. It was only when the Court of Appeals ruled in favor of private respondent did it raise the issue of jurisdiction. The Bank actively participated in the proceedings before the Labor Arbiter, the NLRC and the Court of Appeals. While it is true that jurisdiction over the subject matter of a case may be raised at any time of the proceedings, this rule presupposes that laches or estoppel has not supervened. In this regard, Baaga vs. Commission on the Settlement of Land Problems,[11] is most enlightening. The Court therein stated:

This Court has time and again frowned upon the undesirable practice of a party submitting his case for decision and then accepting the judgment, only if favorable, and attacking it for lack of jurisdiction when adverse. Here, the principle of estoppel lies. Hence, a party may be estopped or barred from raising the question of jurisdiction for the first time in a petition before the Supreme Court when it failed to do so in the early stages of the proceedings.
Undeterred, the Bank also contends that estoppel cannot lie considering that from the beginning, petitioner Bank has consistently asserted in all its pleadings at all stages of the proceedings that respondent held the position of Assistant Vice President, an elective position which she held by virtue of her having been elected as such by the Board of Directors. As far as the records before this Court reveal however, such an assertion was made only in the appeal to the NLRC and raised again before the Court of Appeals, not for purposes of questioning

jurisdiction but to establish that private respondents tenure was subject to the discretion of the Board of Directors and that her non-reelection was a mere expiration of her term. The Bank insists that private respondent was elected Assistant Vice President sometime in 1990 to serve as such for only one year. This argument will not do either and must be rejected. It appears that private respondent was appointed Accounting Clerk by the Bank on July 14, 1963. From that position she rose to become supervisor. Then in 1982, she was appointed Assistant Vice-President which she occupied until her illegal dismissal on July 19, 1991. The banks contention that she merely holds an elective position and that in effect she is not a regular employee is belied by the nature of her work and her length of service with the Bank. As earlier stated, she rose from the ranks and has been employed with the Bank since 1963 until the termination of her employment in 1991. As Assistant Vice President of the foreign department of the Bank, she is tasked, among others, to collect checks drawn against overseas banks payable in foreign currency and to ensure the collection of foreign bills or checks purchased, including the signing of transmittal letters covering the same. It has been stated that the primary standard of determining regular employment is the reasonable connection between the particular activity performed by the employee in relation to the usual trade or business of the employer.[12] Additionally, an employee is regular because of the nature of work and the length of service, not because of the mode or even the reason for hiring them.[13] As Assistant VicePresident of the Foreign Department of the Bank she performs tasks integral to the operations of the bank and her length of service with the bank totaling 28 years speaks volumes of her status as a regular employee of the bank. In fine, as a regular employee, she is entitled to security of tenure; that is, her services may be terminated only for a just or authorized cause.[14] This being in truth a case of illegal dismissal, it is no wonder then that the Bank endeavored to the very end to establish loss of trust and confidence and serious misconduct on the part of private respondent but, as will be discussed later, to no avail. This brings us to the second issue wherein the Bank insists that it has presented substantial evidence to prove the breach of trust on the part of private respondent warranting her dismissal. On this point, the Court of Appeals disagreed and set aside the findings of the NLRC that Reyes deliberately withheld the release of the two dollar checks; that she is guilty of conflict of interest that she waived her right to due process for not attending the hearing; and that she was dismissed based on loss of trust and confidence. We quote pertinent portions of the decision, to wit:

FIRST: Respondent Bank heavily relied on the testimony and affidavit of Remittance Clerk Joven in trying to establish loss of confidence. However, Jovens allegation that petitioner instructed her to hold the subject two dollar checks amounting to $224,650.00 falls short of the requisite proof to warrant petitioners dismissal. Except for Jovens bare assertion to withhold the dollar checks per petitioners instruction, respondent Bank failed to adduce convincing evidence to prove bad faith and malice. It bears emphasizing that respondent Banks witnesses merely corroborate Jovens testimony. Upon this point, the rule that proof beyond reasonable doubt is not required to terminate an employee on the charge of loss of confidence and that it is sufficient that

there is some basis for such loss of confidence, is not absolute. The right of an employer to dismiss employees on the ground that it has lost its trust and confidence in him must not be exercised arbitrarily and without just cause. For loss of trust and confidence to be valid ground for an employees dismissal, it must be substantial and not arbitrary, and must be founded on clearly established facts sufficient to warrant the employees separation from work (Labor vs. NLRC, 248 SCRA 183). SECOND. Respondent Banks charge of deliberate withholding of the two dollar checks finds no support in the testimony of Atty. Jocson, Chairman of the Investigating Committee. On cross examination, Atty. Jocson testified that the documents themselves do not show any direct withholding (pp. 186-187, Rollo). There being conflict in the statement of witnesses, the court must adopt the testimony which it believes to be true (U.S. vs. Losada, 18 Phil. 90). THIRD. Settled is the rule that when the conclusions of the Labor Arbiter are sufficiently substantiated by the evidence on record, the same should be respected by appellate tribunals since he is in a better position to assess and evaluate the credibility of the contending parties (Ala Mode Garments, Inc. vs. NLRC, 268 SCRA 497). In this regard, the Court quotes with approval the following disquisition of Labor Arbiter Linsangan, thus: This Office has repeatedly gone over the records of the case and painstakingly examined the testimonies of respondent banks witnesses. One thing was clearly established: that the legality of complainants dismissal based on the first ground stated in respondents letter of termination (exh. 25-J, supra) will rise or fall on the credibility of Miss Joven who undisputedly is the star witness for the bank. It will be observed that the testimonies of the banks other witnesses, Analiza Castillo, Dante Castor and Antonio Ragasa pertaining to the non-release of the dollar checks and their corresponding transmittal letters were all anchored on what was told them by Ms. Joven, that is: she was instructed by complainant to hold the release of subject checks. In a nutshell, therefore, the issue boils down to who between complainant and Ms. Joven is more credible. After painstakingly examining the testimonies of Ms. Joven and respondents other witnesses this Office finds the evidence still wanting in proof of complainants guilt. This Office had closely observed the demeanor of Ms. Joven while testifying on the witness stand and was not impressed by her assertions. The allegation of Ms. Joven in that her non-release of the dollar checks was upon the instruction of complainant Reyes is extremely doubtful. In the first place, the said instruction constitutes a gross violation of the banks standard operating procedure. Moreover, Ms. Joven was fully aware that the instruction, if carried out, will greatly prejudice her employer bank. It was incumbent upon Ms. Joven not only to disobey the

instruction but even to report the matter to management, if same was really given to her by complainant. Our doubt on the veracity of Ms. Jovens allegation even deepens as we consider the fact that when the non-release of the checks was discovered by Ms. Castillo the former contented herself by continuously not taking any action on the two dollar checks. Worse, Ms. Joven even impliedly told by Ms. Castillo (sic) to ignore the two checks and just withhold their release. In her affidavit Ms. Castillo said: 4. When I asked Cecille Joven what I was supposed to do with those checks, she said the same should be held as per instruction of Mrs. Reyes. (Exh. 14, supra). The evidence shows that it was only on 16 May 1990 that Ms. Joven broke her silence on the matter despite the fact that on 15 November 1989, at about 8:00 p.m. the complainant, accompanied by driver Celestino Banito, went to her residence and confronted her regarding the non-release of the dollar checks. It took Ms. Joven eighteen (18) months before she explained her side on the controversy. As to what prompted her to make her letter of explanation was not even mentioned. On the other hand, the actions taken by the complainant were spontaneous. When complainant was informed by Mr. Castor and Ms. Castillo regarding the non-release of the checks sometime in November, 1989 she immediately reported the matter to Vice President Santos, Head of the Foreign Department. And as earlier mentioned, complainant went to the residence of Ms. Joven to confront her. In this regard, Celestino Bonito, complainants driver, stated in his affidavit, thus: 1. Sometime on November 15, 1989 at about 7:00 oclock in the evening, Mrs. Clarita Tan Reyes and I were in the residence of one Ms. Cecille Joven, then a Processing Clerk in the Foreign Department of Prudential Bank; 2. Ms. Cecille Joven, her mother, myself, and Mrs. Clarita Tan Reyes were seated in the sala when the latter asked the former, Ms. Cecille Joven, how it came about that the two dollar checks which she was then holding with the transmittal letters, were found in a plastic envelope kept day-to-day by the former; 3. Hesitatingly, Cecille Joven said: Eh, Mother (Mrs. Tan Reyes had been intimately called Mother in the Bank) akala ko bouncing checks yon mga yon. 4. Mrs. Clarita Tan Reyes, upon hearing those words, was surprised and she said: Ano, papaano mong alam na bouncing na hindi mo pa pinadadala; 5. Mrs. Cecille Joven turned pale and was not able to answer.

There are other factors that constrain this Office to doubt even more the legality of complainants dismissal based on the first ground stated in the letter of dismissal. The non-release of the dollar checks was reported to top management sometime on 15 November 1989 when complainant, accompanied by Supervisor Dante Castor and Analiza Castillo, reported the matter to Vice President Santos. And yet, it was only on 08 March 1991, after a lapse of sixteen (16) months from the time the non-release of the checks was reported to the Vice President, that complainant was issued a memorandum directing her to submit an explanation. And it took the bank another four (4) months before it dismissed complainant. The delayed action taken by respondent against complainant lends credence to the assertion of the latter that her dismissal was a mere retaliation to the criminal complaints she filed against the banks top officials. It clearly appears from the foregoing that the complainant herein has no knowledge of, much less participation in, the non-release of the dollar checks under discussion. Ms. Joven is solely responsible for the same. Incidentally, she was not even reprimanded by the bank. FOURTH. Respondent Bank having failed to furnish petitioner necessary documents imputing loss of confidence, petitioner was not amply afforded opportunity to prepare an intelligent answer. The Court finds nothing confidential in the auditors report and the affidavit of Transmittal Clerk Joven. Due process dictates that management accord the employees every kind of assistance to enable him to prepare adequately for his defense, including legal representation. The issue of conflict of interest not having been covered by the investigation, the Court finds it irrelevant to the charge.[15]
We uphold the findings of the Court of Appeals that the dismissal of private respondent on the ground of loss of trust and confidence was without basis. The charge was predicated on the testimony of Ms. Joven and we defer to the findings of the Labor Arbiter as confirmed and adopted by the Court of Appeals on the credibility of said witness. This Court is not a trier of facts and will not weigh anew the evidence already passed upon by the Court of Appeals.[16] On the third issue, the Bank questions the award of full backwages and other benefits from July 19, 1991 up to the finality of this judgment; separation pay equivalent to one (1) month salary for every year of service in lieu of reinstatement; and attorneys fees equivalent to ten (10%) percent of the total award. The Bank argues, in the main, that private respondent is not entitled to full backwages in view of the fact that she did not bother to appeal that portion of the labor arbiters judgment awarding back wages limited to three years. It must be stressed that private respondent filed a special civil action for certiorari to review the decision of the NLRC[17]and not an ordinary appeal. An ordinary appeal is distinguished from the remedy of certiorari under Rule 65 of the Revised Rules of Court in that in ordinary appeals it is settled that

a party who did not appeal cannot seek affirmative relief other than the ones granted in the decision of the court below.[18] On the other hand, resort to a judicial review of the decisions of the National Labor Relations Commission in a petition for certiorari under Rule 65 of Rules of Court is confined to issues of want or excess of jurisdiction and grave abuse of discretion. [19] In the instant case, the Court of Appeals found that the NLRC gravely abused its discretion in finding that the private respondents dismissal was valid and so reversed the same. Corollary to the foregoing, the appellate court awarded backwages in accordance with current jurisprudence. Indeed, jurisprudence is clear on the amount of backwages recoverable in cases of illegal dismissal. Employees illegally dismissed prior to the effectivity of Republic Act No. 6715 on March 21, 1989 are entitled to backwages up to three (3) years without deduction or qualification, while those illegally dismissed after are granted full backwages inclusive of allowances and other benefits or their monetary equivalent from the time their actual compensation was withheld from them up to the time of their actual reinstatement.[20] Considering that private respondent was terminated on July 19, 1991, she is entitled to full backwages from the time her actual compensation was withheld from her (which, as a rule, is from the time of her illegal dismissal) up to the finality of this judgment (instead of reinstatement) considering that reinstatement is no longer feasible as correctly pointed out by the Court of Appeals on account of the strained relations brought about by the litigation in this case. Since reinstatement is no longer viable, she is also entitled to separation pay equivalent to one (1) month salary for every year of service.[21] Lastly, since private respondent was compelled to file an action for illegal dismissal with the labor arbiter, she is likewise entitled to attorneys fees[22] at the rate above-mentioned. There is no room to argue, as the Bank does here, that its liability should be mitigated on account of its good faith and that private respondent is not entirely blameless. There is no showing that private respondent is partly at fault or that the Bank acted in good faith in terminating an employee of twenty-eight years. In any event, Article 279 of Republic Act No. 6715[23] clearly and plainly provides for full backwages to illegally dismissed employees. WHEREFORE, the instant petition for review on certiorari is DENIED, and the assailed Decision of the Court of Appeals, dated October 15, 1999, is AFFIRMED. SO ORDERED. Melo, (Chairman), Vitug, Panganiban, and Sandoval-Gutierrez, JJ., concur.

Ilaw at Buklod ng Manggagawa vs. NLRC

Ilaw at Buklod ng Manggagawa (IBM) vs. NLRC 198 SCRA 586 (1991)

Facts: The union known as Ilaw at Buklod Ng Manggagawa (IBM) said to represent 4,500 employees of San Miguel Corporation, more or less, working at the various plants, offices, and warehouses located at the National Capital Region presented to the company a "demand" for correction of the significant distortion in the workers' wages. In that demand, the Union explicitly invoked Section 4 (d) of RA 6727 which reads as follows: Where the application of the increases in the wage rates under this Section results in distortions as defined under existing laws in the wage structure within an establishment and gives rise to a dispute therein, such dispute shall first be settled voluntarily between the parties and in the event of a deadlock, the same shall be finally resolved through compulsory arbitration by the regional branches of the National Labor Relations Commission having jurisdiction over the workplace. It shall be mandatory for the NLRC to conduct continuous hearings and decide any dispute arising under this Section within twenty (20) calendar days from the time said dispute is formally submitted to it for arbitration. The pendency of a dispute arising from a wage distortion shall not in any way delay the applicability of the increase in the wage rates prescribed under this Section. Issue: Whether or not the strike is legal in the resolution of wage distortion. Ruling: The strike involving the issue of wage distortion is illegal as a means of resolving it. The legality of these activities is usually dependent on the legality of the purposes sought to be attained and the means employed therefore. It goes without saying that these joint or coordinated activities may be forbidden or restricted by law or contract. In the instance of "distortions of the wage structure within an establishment" resulting from "the application of any prescribed wage increase by virtue of a law or wage order," Section 3 of Republic Act No. 6727 prescribes a specific, detailed and comprehensive procedure for the correction thereof, thereby implicitly excluding strikes or lockouts or other concerted activities as modes of settlement of the issue. The provision states that the employer and the union shall negotiate to correct the distortions. Any dispute arising from wage distortions shall be resolved through the grievance procedure under their collective bargaining agreement and, if it remains unresolved, through voluntary arbitration. Unless otherwise agreed by the parties in writing, such dispute shall be decided by the voluntary arbitrator or panel of voluntary arbitrators within ten (10) calendar days from the time said dispute was referred to voluntary arbitration. In cases where there are no collective agreements or recognized labor unions, the employers and workers shall endeavor to correct such distortions. Any dispute arising there from shall be settled through the National Conciliation and Mediation Board and, if it remains unresolved after ten (10) calendar days of conciliation, shall be referred to the appropriate branch of the National Labor Relations Commission (NLRC). It shall be mandatory for the NLRC to conduct continuous hearings and decide the dispute within twenty (20) calendar days from the time said dispute is submitted for compulsory arbitration. The pendency of a dispute arising from a wage distortion shall not in any way delay the applicability of any increase in prescribed wage rates pursuant to the provisions of law or Wage Order. The legislative intent that solution of the problem of wage distortions shall be sought by voluntary negotiation or arbitration, and not by strikes, lockouts, or other concerted activities of the employees or management, is made clear in the rules implementing RA 6727 issued by the Secretary of Labor and Employment pursuant to the authority granted by Section 13 of the Act. Section 16, Chapter I of these implementing rules, after reiterating the policy that wage distortions be first settled voluntarily by the parties and eventually by compulsory arbitration, declares that, "Any issue involving wage distortion shall not be a ground for a strike/lockout."

PNB vs CABANSAG Case Digest

[G.R. No. 157010. June 21, 2005] PHILIPPINE NATIONAL BANK, petitioner, vs. FLORENCE O. CABANSAG, respondent. FACTS In late 1998, [herein Respondent Florence Cabansag] arrived in Singapore as a tourist. She applied for employment, with the Singapore Branch of the Philippine National Bank. At the time, the Singapore PNB Branch was under the helm of Ruben C. Tobias, a lawyer, as General Manager, with the rank of Vice-President of the Bank. She applied for employment as Branch Credit Officer, at a total monthly package of $SG4,500.00, effective upon assumption of duties after approval. Ruben C. Tobias found her eminently qualified and wrote on October 26, 1998, a letter to the President of the Bank in Manila, recommending the appointment of Florence O. Cabansag, for the position. On December 7, 1998, Ruben C. Tobias wrote a letter to Florence O. Cabansag offering her a temporary appointment, as Credit Officer, at a basic salary of Singapore Dollars 4,500.00, a month and, upon her successful completion of her probation to be determined solely, by the Bank, she may be extended at the discretion of the Bank, a permanent appointment and that her temporary appointment was subject to certain terms and conditions. Cabansag accepted the position and assumed office. In the meantime, the Philippine Embassy in Singapore processed the employment contract of Florence O. Cabansag and, on March 8, 1999, she was issued by the Philippine Overseas Employment Administration, an Overseas Employment Certificate, certifying that she was a bona fide contract worker for Singapore. Barely three (3) months in office Tobias told Cabansag that her resignation was imperative as a cost-cutting measure of the Bank. Tobias, likewise, told Cabansag that the PNB Singapore Branch will be sold or transformed into a remittance office and that, in either way, she had to resign from her employment. She then asked Ruben C. Tobias that she be furnished with a Formal Advice from the PNB Head Office in Manila. However, Ruben C. Tobias flatly refused. Florence O. Cabansag did not submit any letter of resignation. On April 16, 1999, Ruben C. Tobias again summoned Florence O. Cabansag to his office and demanded that she submit her letter of resignation, with the pretext that he needed a Chinesespeaking Credit Officer to penetrate the local market, with the information that a Chinese-speaking Credit Officer had already been hired and will be reporting for work soon. She was warned that, unless she submitted her letter of resignation, her employment record will be blemished with the notation DISMISSED spread thereon. Without giving any definitive answer, Florence O. Cabansag asked Ruben C. Tobias that she be given sufficient time to look for another job. Ruben C. Tobias told her that she should be out of her employment by May 15, 1999. However, on April 19, 1999, Ruben C. Tobias again summoned Florence O. Cabansag and adamantly ordered her to submit her letter of resignation. She refused. On April 20, 1999, she received a letter from Ruben C. Tobias terminating her employment with the Bank. On January 18, 2000, the Labor Arbiter rendered judgment in favor of the Complainant and against the Respondents. PNB appealed the labor arbiters Decision to the NLRC. In a Resolution dated June 29, 2001, the Commission affirmed that Decision.

Petitioner appealed to the Court of Appeals which rendered a decision in favor of Florence Cabansag. ISSUE Whether or not the arbitration branch of the NLRC in the National Capital Region has jurisdiction over the instant controversy. HELD The jurisdiction of labor arbiters and the NLRC is specified in Article 217 of the Labor Code and more specifically, Section 10 of RA 8042 reads in part: SECTION 10. Money Claims. Notwithstanding any provision of law to the contrary, the Labor Arbiters of the National Labor Relations Commission (NLRC) shall have the original and exclusive jurisdiction to hear and decide, within ninety (90) calendar days after the filing of the complaint, the claims arising out of an employer-employee relationship or by virtue of any law or contract involving Filipino workers for overseas deployment including claims for actual, moral, exemplary and other forms of damages. Based on the foregoing provisions, labor arbiters clearly have original and exclusive jurisdiction over claims arising from employer-employee relations, including termination disputes involving all workers, among whom are overseas Filipino workers (OFW). We are not unmindful of the fact that respondent was directly hired, while on a tourist status in Singapore, by the PNB branch in that city state. Prior to employing respondent, petitioner had to obtain an employment pass for her from the Singapore Ministry of Manpower. Securing the pass was a regulatory requirement pursuant to the immigration regulations of that country. Noteworthy is the fact that respondent likewise applied for and secured an Overseas Employment Certificate from the POEA through the Philippine Embassy in Singapore. The Certificate, issued on March 8, 1999, declared her a bona fide contract worker for Singapore. Under Philippine law, this document authorized her working status in a foreign country and entitled her to all benefits and processes under our statutes. Thus, even assuming arguendo that she was considered at the start of her employment as a direct hire governed by and subject to the laws, common practices and customs prevailing in Singapore she subsequently became a contract worker or an OFW who was covered by Philippine labor laws and policies upon certification by the POEA. At the time her employment was illegally terminated, she already possessed the POEA employment Certificate. Whether employed locally or overseas, all Filipino workers enjoy the protective mantle of Philippine labor and social legislation, contract stipulations to the contrary notwithstanding. For purposes of venue, workplace shall be understood as the place or locality where the employee is regularly assigned when the cause of action arose. It shall include the place where the employee is supposed to report back after a temporary detail, assignment or travel. In the case of field employees, as well as ambulant or itinerant workers, their workplace is where they are regularly assigned, or where they are supposed to regularly receive their salaries/wages or work instructions from, and report the results of their assignment to their employers. Under the Migrant Workers and Overseas Filipinos Act of 1995 (RA 8042), a migrant worker refers to a person who is to be engaged, is engaged or has been engaged in a remunerated activity in a state of which he or she is not a legal resident; to be used interchangeably with overseas Filipino worker.[21] Undeniably, respondent was employed by petitioner in its branch office in Singapore.

Admittedly, she is a Filipino and not a legal resident of that state. She thus falls within the category of migrant worker or overseas Filipino worker.

SMC Employees Union v. Bersamira, 186 SCRA 496 (1990) FACTS: SMC entered into contracts for merchandising services with Lipercon and D'Rite (L&D), independent contractors duly licensed by DOLE. In said contracts, it was expressly understood and agreed that the EEs employed by the contractors were to be paid by the latter and that none of them were to be deemed EEs or agents of SanMig. There was to be no employer-employee relation between the contractors and/or its workers, on the one hand, and SMC on the other.

Petitioner SMCEU-PTWGO (Union) is duly authorized representative of the monthly paid rank-and-file EEs of SMC. Their CBA provides that temporary, probationary, or contract EEs are excluded from the bargaining unit and outside scope of CBA. Union advised SMC that some L&D workers had signed up for union membership and sought the regularization of their employment with SMC. Union alleged that this group of EEs, while appearing to be contractual workers of supposedly independent contractors, have been continuously working for SMC for a period of 6 months to 15 years and that their work is neither casual nor seasonal as they are performing work or activities necessary or desirable in the usual business or trade of SMC, and that there exists a "labor-only" contracting situation. It was then demanded that the employment status of these workers be regularized. This was not acted upon by SMC, and so Union filed a notice of strike, and then a second notice. Series of pickets were staged by L&D workers in various SMC plants and offices. SMC RTC to enjoin the Union from: representing and or acting for and in behalf of the employees of L&D for the purposes of collective bargaining; calling for and holding a strike vote to compel plaintiff to hire the employees or workers of L&D, among others. Union filed a Motion to Dismiss SMC's Complaint on the ground of lack of jurisdiction over the case/nature of the action, which motion was opposed by SMC, which was denied by respondent Judge. And after several hearings, issued Injunction. RTC reasoned that the absence of ER-EE relationship negates the existence of labor dispute, so court has jurisdiction to take cognizance of SMC's grievance. Hence, this action. ISSUE: WON RTC correctly assumed jurisdiction over the controversy and properly issued the Writ of Preliminary Injunction. HELD: NO Re: Definition of Labor Dispute (p4 of Outline) Ratio A labor dispute can nevertheless exist regardless of whether the disputants stand in the proximate relationship of employer and employee, provided the controversy concerns, among others, the terms and

conditions of employment or a "change" or "arrangement" thereof The existence of a labor dispute is not negatived by the fact that the plaintiffs and defendants do not stand in the proximate relation of employer and employee. (A212 LC) Reasoning Crucial to the resolution of the question on jurisdiction, is the matter of whether or not the case at bar involves, or is inconnection with, or relates to a labor dispute. An affirmative answer would bring the case within the original and exclusive jurisdiction of labor tribunals to the exclusion of the regular Courts. In this case, the matter re terms, tenure and conditions of EEs employment and the arrangement of those terms as well as the matter of representation bring these issues within the scope of a labor dispute. Hence it is the labor tribunals that have jurisdiction and not the regular courts Re: ER Functions and ULP (p30 of Outline) As the case is indisputably linked with a labor dispute, jurisdiction belongs to the labor tribunals. So, Labor Arbiters haveoriginal and exclusive jurisdiction to hear and decide the following cases involving all workers including: [a] unfair labor practice cases; [b] those that workers may file involving wages, hours of work and other terms and conditions of employment; and [c] cases arising from any violation of A265 LC, including questions involving the legality of striker and lockouts. SMCs claim that the action is for damages under A19, 20 and 21 of CC is not enough to keep the case within the jurisdictional boundaries of regular Courts. That claim for damages is interwoven with a labor dispute. To allow the action filed below to prosper would bring about "split jurisdiction" which is obnoxious to the orderly administration of justice. SC recognizes the proprietary right of SMC to exercise an inherent management prerogative and its best business judgment to determine whether it should contract out the performance of some of its work to independent contractors. However, the rights of all workers to self-organization, collective bargaining and negotiations, and peaceful concerted activities, including the right to strike in accordance with law (S3, A13, 1987 Constitution)equally call for recognition and protection. Those contending interests must be placed in proper perspective and equilibrium. Disposition Petition is GRANTED.