SECOND DIVISION
G.R. No. 190389, April 19, 2017
MANGGAGAWA NG KOMUNIKASYON SA PILIPINAS, Petitioner, v. PHILIPPINE LONG DISTANCE TELEPHONE COMPANY INCORPORATED, Respondent.
G.R. No. 190390
MANGGAGAWA NG KOMUNIKASYON SA PILIPINAS, Petitioner, v. PHILIPPINE LONG DISTANCE TELEPHONE COMPANY INCORPORATED, Respondent.
D E C I S I O N
LEONEN, J.:
An employer's declaration of redundancy becomes a valid and authorized cause for dismissal when the employer proves by substantial evidence that the services of an employee are more than what is reasonably demanded by the requirements of the business enterprise.1
This resolves the Petition for Review on Certiorari2 filed by Manggagawa ng Komunikasyon sa Pilipinas assailing the Court of Appeals' Decision3 dated August 28, 2008 and Resolution4 dated November 24, 2009 in CA-G.R. SP No. 94365 and CA-G.R. SP No. 98975. CA-G.R. SP No. 94365 upheld the October 28, 20055 and January 31, 20066 Resolutions of the National Labor Relations Commission in NLRC Certified Case No. 000232-03 (NLRC NCR NS 11-405-02 & 11-412-02). In turn, CA-G.R. SP No. 98975 upheld the Secretary of Labor and Employment's August 11, 2006 Resolution7 and March 16, 2007 Order.8
On June 27, 2002, the labor organization Manggagawa ng Komunikasyon sa Pilipinas, which represented the employees of Philippine Long Distance Telephone Company, filed a notice of strike with the National Conciliation and Mediation Board.9 Manggagawa ng Komunikasyon sa Pilipinas charged Philippine Long Distance Telephone Company with unfair labor practice "for transferring several employees of its Provisioning Support Division to Bicutan, Taguig."10
The first notice of strike was amended twice by Manggagawa ng Komunikasyon sa Pilipinas.11 On its second amendment dated November 4, 2002, docketed as NCMB-NCR-NS No. 11-405-02,12 Manggagawa ng Komunikasyon sa Pilipinas accused Philippine Long Distance Telephone Company of the following unfair labor practices:
UNFAIR LABOR PRACTICES, to wit:
UNFAIR LABOR PRACTICES, to wit:On December 23, 2002, Manggagawa ng Komunikasyon sa Pilipinas went on strike.16
- PLDT's alleged restructuring of its [Greater Metropolitan Manila] Operation Services December 31, 2002 and its closure of traffic operations at the Batangas, Calamba, Davao, Iloilo, Lucena, Malolos and Tarlac Regional Operator Services effective December 31, 2002. These twin moves unjustly imperil the job security of 503 of MKP's members and will substantially decimate the parties' bargaining unit. And in the light of PLDT's previous commitment before this Honorable Office that it will provide MKP its comprehensive plan/s with respect to personnel downsizing/reorganization and closure of exchanges and of its more recent declaration that the Davao operator services will not be closed, these moves are treacherous and are thus violative of PLDT's duty to bargain collectively with MKP in good faith. That these moves were effected with PLDT paying only lip service to its duties under Art. III, Section 8 of the parties' CBA do [sic] signifies PLDT's gross violation of said CBA.15
WHEREFORE, FOREGOING PREMISES CONSIDERED, this Office hereby CERTIFIES the labor dispute at the Philippine Long Distance Telephone Company to the National Labor Relations Commission (NLRC) for compulsory arbitration pursuant to Article 263 (g) of the Labor Code, as amended.Manggagawa ng Komunikasyon sa Pilipinas filed a Petition for Certiorari before the Court of Appeals, challenging the Secretary of Labor and Employment's Order insofar as it created a distinction among the striking workers in the return-to-work order. The petition was docketed as CA-G.R. SP No. 76262.20
Accordingly, the strike staged by the Union is hereby enjoined. All striking workers are hereby directed to return to work within twenty four (24) hours from receipt of this Order, except those who were terminated due to redundancy. The employer is hereby enjoined to accept the striking workers under the same terms and conditions prevailing prior to the strike. The parties are likewise directed to cease and desist from committing any act that might worsen the situation.
Let the entire records of the case be forwarded to the NLRC for its immediate and appropriate action.
SO ORDERED.19
As Article 263(g) is clear and unequivocal in stating that ALL striking or locked out employees shall immediately return to work and the employer shall immediately resume operations and readmit ALL workers under the same terms and conditions prevailing before the strike or lockout, then the unmistakable mandate must be followed by the Secretary.24On October 28, 2005, the National Labor Relations Commission dismissed Manggagawa ng Komunikasyon sa Pilipinas' charges of unfair labor practices against Philippine Long Distance Telephone Company.25
WHEREFORE, premises considered, the Union[']s charge of unfair labor practice against PLDT is ordered DISMISSED for lack of merit.On January 31, 2006, the National Labor Relations Commission denied Manggagawa ng Komunikasyon sa Pilipinas' motion for reconsideration.30
SO ORDERED.29
[T]he affected employees should at least be paid their salaries during the period from January 3, 2003 (the working day immediately following the effectivity of their separation) to April 29, 2006 (the date when the October 28, 2005 decision of the NLRC (declaring the employees' dismissal as valid) became final and executory.44The Court of Appeals compared the case to an illegal dismissal case where the Labor Arbiter found for the employee and ordered the payroll reinstatement of the employee; however, the finding of illegality was later reversed on appeal.45
WHEREFORE, the PETITIONS FOR CERTIORARI IN CA-G.R. SP Nos. 94365 and 98975 are DISMISSED for lack of merit.On November 24, 2009, the Court of Appeals denied Manggagawa ng Komunikasyon sa Pilipinas' motion for reconsideration.47
SO ORDERED.46 (Emphasis in the original)
As a rule, only questions of law may be raised in a Rule 45 petition. In one case, we discussed the particular parameters of a Rule 45 appeal from the CA's Rule 65 decision on a labor case, as follows:Justice Arturo D. Brion's dissent in Abbot Laboratories, Philippines v. Alcaraz74 thereafter laid down the guidelines to be followed in reviewing a petition for review under Rule 45:In a Rule 45 review, we consider the correctness of the assailed CA decision, in contrast with the review for jurisdictional error that we undertake under Rule 65. Furthermore, Rule 45 limits us to the review of questions of law raised against the assailed CA decision. In ruling for legal correctness, we have to view the CA decision in the same context that the petition for certiorari it ruled upon was presented to it; we have to examine the CA decision from the prism of whether it correctly determined the presence or absence of grave abuse of discretion in the NLRC decision before it, not on the basis of whether the NLRC decision on the merits of the case was correct. In other words, we have to be keenly aware that the CA undertook a Rule 65 review, not a review on appeal, of the NLRC decision challenged before it.73 (Emphasis in the original)
If the NLRC ruling has basis in the evidence and the applicable law and jurisprudence, then no grave abuse of discretion exists and the CA should so declare and, accordingly, dismiss the petition. If grave abuse of discretion exists, then the CA must grant the petition and nullify the NLRC ruling, entering at the same time the ruling that is justified under the evidence and the governing law, rules and jurisprudence. In our Rule 45 review, this Court must deny the petition if it finds that the CA correctly acted.75 (Emphasis in the original)We shall adopt these parameters in resolving the substantive issues in the Petition.
For the implementation of a redundancy program to be valid, the employer must comply with the following requisites: (1) written notice served on both the employees and the Department of Labor and Employment at least one month prior to the intended date of retrenchment; (2) payment of separation pay equivalent to at least one month pay or at least one month pay for every year of service, whichever is higher; (3) good faith in abolishing the redundant positions; and (4) fair and reasonable criteria in ascertaining what positions are to be declared redundant and accordingly abolished.82 (Citations omitted)To establish good faith, the company must provide substantial proof that the services of the employees are in excess of what is required of the company, and that fair and reasonable criteria were used to determine the redundant positions.83
Philippine Long Distance Telephone Company has stated that "from 1996 to 2002, the [t]otal [d]emand of [c]alls dropped by 334,972,997 or a 72% reduction."85 It has attributed the reduction of demand for operatorassisted 108/109 calls to "migration calls to direct distance dialing," and to "more usage/substitution of text message over voice."86 It has added that "migration of calls from landline to cell," competitors' eating into the Philippine Long Distance Telephone Company's market, and "compliance with the regulatory requirement of local integration per province" likewise aggravated the situation.87
RECEIVED CALLS YEAR 108 109 TOTAL 1996 33,641,751 430,125,633 463,767,384 1997 34,834,800 318,942,573 353,777,373 1998 28,651,703 209,458,041 238,109,744 1999 24,797,870 212,363,846 237,161,716 2000 21,697,367 218,380,277 240,077,644 2001 15,773,988 158,310,276 174,084,264 2002 14,363,918 114,430,469 128,794,387
The National Labor Relations Commission has found that Philippine Long Distance Telephone Company was able to discharge its burden of proving that its redundancy measures had substantial basis:
(a) international long distance revenues in 2001 stood at P11.4 billion; in 2002, this declined to P10.6 billion (pg. 33, PLDT's Financial Statement and Annual Report; Atmex "4-A") - a decrease of P813 million. More drastically, this figure stood at P18.2 billion in 1997, indicating that international long distance call revenue has declined to the tune of P8 billion in five years. (b) national long distance revenues in 2001 were P8.388 billion in 2001; in 2002, this declined to P7.6 billion (pg. 35, PLDT's Financial Statement and Annual Report; Annex "4-B") a decrease of P719 million. As with international calls, there is a pattern on decline: PLDT earned P10.6 billion from this service in 2000, so it is accurate to say that the company has seen revenue from national long distance decline by more than a billion pesos a year.89
Guided by the foregoing jurisprudence, it is evident that PLDT discharged the burden of proving that the declaration or implementation of redundancy measures have basis. For one, PLDT experienced a decline of subscribers, long distance calls, operated both local and abroad, has declined, landline or fixed line services also declined. This decrease of the need of PLDT services resulted from the advent of wireless telephone, of texting as means of communication, the use of direct dialing including prepaid telesulit and teletipid measures introduced in the communication services. For another, PLDT has a debt burden of P70 billion pesos and it cannot subsidize the salaries of employees whose positions are redundant.90The Court of Appeals echoed the findings of the National Labor Relations Commission regarding the validity of Philippine Long Distance Telephone Company's redundancy measures:
We find that MKP demonstrated no such patent and gross evasion of a positive duty on the part of the NLRC. On the contrary, the NLRC's finding that the 2002 redundancy declaration of PLDT was justified and valid rested on substantial evidence, for the NLRC ostensibly based its finding on established facts showing the decline of subscribers, the decline in long distance local and international calls, and the decline in landline or fixed line services, constraining PLDT to declare certain positions redundant. There could be no question that such factual circumstances were traceable to "the advent of wireless telephone, of texting as a means of communication, the use of direct dialing including prepaid telesulit and teletipid measures introduced in the communication services."This Court sees no reason to depart from the findings of the Court of Appeals and of the National Labor Relations Commission.
As such, the NLRC did not commit any grave abuse of discretion when it regarded the technological advancements resulting in less work for the redundated employees as justifying PLOT's declaration of redundancy.91
The notices of termination of employment96 signed by Erlinda S. Kabigting, Philippine Long Distance Telephone Company Vice-President for Operator Services Section,97 provided two (2) types of separation packages for the terminated workers. These were: (1) regular retirement benefits plus 75% basic monthly pay for every year of service for employees who had been with Philippine Long Distance Telephone Company for more than 15 years; and (2) 175% of basic monthly pay for every year of service for employees who had been with PLDT for less than 15 years.November 25, 2002
MYRNA C. CASTRO
OPERATOR SERVICES-NORTH
Dear Ms. Castro:
After a thorough review of operations, Management has determined that there is a need to reduce its manpower requirements considering technological, organization, and process developments. This reduction is inevitable to ensure the company's survival in the long term.
Your position is one of those affected by such changes and developments. Thus, with much regret, your service to the company will be considered completed by December 30, 2002.
In recognition of your loyalty and dedicated service, the company is granting a generous separation pay package that will assist you in making the necessary adjustments to your new situation.
This separation package consists of your regular retirement benefits plus 75% of basic monthly pay for every year of service, or a minimum of 175% of basic monthly pay for every year of service for employees with less than 15 years of service.
Counseling service on financial options in the future will be available to assist you during your period of adjustment.
We would like to take this opportunity to thank you for your service to the Company and wish you well in all your future undertakings.Very truly yours,
PHILIPPINE LONG DISTANCE TELEPHONE CO., INC
(signed)
ERLINDA S. KABIGTING95
(Emphasis supplied)
Separation pay is required in the cases enumerated in Articles 283 and 284 of the Labor Code, which include retrenchment, and is computed at at least one month salary or at the rate of one-half month salary for every month of service, whichever is higher. We have held that it is a statutory right designed to provide the employee with the wherewithal during the period that he is looking for another employment.Separation pay brought about by redundancy is a statutory right, and it is irrelevant that the retirement benefits together with the separation pay given to the terminated workers resulted in a total amount that appeared to be more than what is required by the law. The facts. show that instead of the legally required one (1) month salary for every year of service rendered, the terminated workers who were with Philippine Long Distance Telephone Company for more than 15 years received a separation pay of only 75% of their basic pay for every year of service, despite the clear wording of the law.
Retirement benefits, where not mandated by law, may be granted by agreement of the employees and their employer or as a voluntary act on the part of the employer. Retirement benefits are intended to help the employee enjoy the remaining years of his lifelessening the burden of worrying for his financial sup ort, and are a form of reward for his loyalty and service to the employer.100 (Citation omitted)
Article 294. Security of Tenure. - In cases of regular employment, the employer shall not terminate the services of an employee except for a just cause or when authorized by this Title. An employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages, inclusive of allowances, and to his other benefits or their monetary equivalent computedfrom the time his compensation was withheld from him up to the time of his actual reinstatement. (Emphasis supplied)If actual reinstatement is no longer possible, the employee becomes entitled to separation pay in lieu of reinstatement.117
Endnotes:
1Wiltshire File Co. Inc. v. National Labor Relations Commission, 271 Phil. 694, 703 (1991) [Per J. Feliciano, Third Division].
2Rollo, pp. 9-48.
3 Id. at 50-60. The Decision was penned by Associate Justice Lucas P. Bersamin and concurred in by Associate Justices Estela M. Perlas-Bernabe and Ramon M. Bato, Jr. of the Seventeenth Division, Court of Appeals, Manila.
4 Id. at 62-63. The Resolution was penned by Associate Justice Ramon M. Bato, Jr. and concurred in by Associate Justices Josefina Guevara-Salonga and Estela M. Perlas-Bernabe of the Special Former Seventeenth Division, Court of Appeals, Manila.
5 Id. at 96-113.
6 Id. at 115-116.
7 Id. at 669-670.
8 Id. at 671-673.
9 Id. at 51.
10 Id.
11 Id. at 51-52.
12 Id. at 272.
13 Id.
14 Id. at 273-274.
15 Id. at 273.
16 Id. at 52.
17 Id.
18 Id. at 821-823, Order.
19 Id. at 822-823.
20 Id. at 52.
21 Id. at 660-668. The Decision was penned by Associate Justice Andres B. Reyes, Jr. and concurred in by Associate Justices Buenaventura J. Guerrero and Regalado E. Maambong of the Second Division, Court of Appeals, Manila.
22 Id. at 53.
23 501 Phil. 704 (2005) [Per J. Chico-Nazario, Second Division].
24 Id. at 719.
25 Id. at 96-113, Resolution.
26 Id. at 109-110.
27 Id.
28 Id. at 112-113.
29 Id. at 113.
30 Id. at 115-116, Resolution.
31 Id. at 64-94.
32 Id. at 54.
33 Id. at 674-677.
34 Id. at 669-670, Resolution.
35 Id. at 671-673, Order.
36 Id. at 678-686.
37 Id. at 631-657.
38 Id. at 50-60.
39 Id. at 56.
40 Id. at 57.
41 Id.
42 Id. at 59.
43 Id.
44 Id.
45 Id. at 59-60.
46 Id. at 60.
47 Id. at 62-63.
48 Id. at 31.
49 Id.
50 Id. at 1098, MKP Memorandum. The memorandum mistakenly reported this as 335 rank-and-file employees.
51 Id. at 1098-1099.
52 Id. at 1099.
53 Id.
54 Id. at 1101-1107.
55 596 Phil. 510 (2009) [Per J. Carpio Morales, En Banc].
56Rollo, p. 39.
57 Id. at 795-796, Comment.
58 Id. at 797, Comment.
59 Id. at 1038, PLDT Memorandum.
60 Id. at 798-804, Comment.
61 Id. at 1052, PLDT Memorandum.
62 Id. at 1056-1057.
63 Id. at 1056.
64 Id. at 1057.
65 Id. at 1063.
66 Id. at 1064-1065.
67 RULES OF COURT, Rule 45, sec. 1 provides:
Section 1. Filing of petition with Supreme Court. - A party desiring to appeal by certiorari from a judgment or final order or resolution of the Court of Appeals, the Sandiganbayan, the Regional Trial Court or other courts whenever authorized by law, may file with the Supreme Court a verified petition for review on certiorari. The petition shall raise only questions of law which must be distinctly set forth.
68Philippine Airlines v. Dawal, G.R. Nos. 173921 and 173952, February 24, 2016 [Per J. Leonen, Second Division].
69Hongkong Shanghai Banking Corporation Employees Union v. National Labor Relations Commission, 421 Phil. 864, 870 (2001) [Per J. Sandoval-Gutierrez, Third Division].
70 Id.
71 700 Phil. 1 (2012) [Per J. Brion, Second Division].
72 613 Phil. 696 (2009) [Per J. Brion, Second Division).
73Career Philippines Shipmanagement, Inc. v. Serna, 700 Phil. 1, 9 (2012) [Per J. Brion, Second Division], citing Montoya v. Transmed Manila Corporation, 613 Phil. 696, 707 (2009) [Per J. Brion, Second Division].
74 714 Phil. 510 (2013) [Per J. Perlas-Bernabe, En Banc].
75 Dissenting Opinion of J. Brion in Abott Laboratories, Philippines v. Alcaraz, 714 Phil. 510, 549 (2013) [Per J. Perlas-Bernabe, En Banc].
76 Article 298 was formerly Article 283, before it was renumbered by DOLE Department Advisory No. 1, Series of 2015.
77 271 Phil. 694 (1991) [Per J. Feliciano, Third Division].
78 Id. at 703.
79 Id.
80General Milling Corp. v. Viajar, 702 Phil. 532, 543 (2013) [Per J. Reyes, First Division].
81 364 Phil. 912 (1999) [Per J. Puno, Second Division].
82 Id. at 930.
83General Milling Corp. v. Viajar, 702 Phil. 532, 543 (2013) [Per J. Reyes, First Division].
84Rollo, p. 412.
85 Id. at 413.
86 Id.
87 Id.
88 Id. at 260, PLDT Position Paper.
89 Id. at 261-262.
90 Id. at 109-110, Resolution.
91 Id. at 56.
92Wiltshire File Co., Inc. v National Labor Relations Commission, 271 Phil. 694, 703-704 (1991) [Per J. Feliciano, Third Division].
93 LABOR CODE, art. 298.
94Rollo, p. 1049, PLDT Memorandum.
95 Id. at 496.
96 Id. at 479-557.
97 Id. at 55.
98 LABOR CODE, art. 298 provides:
Article 298. Closure of Establishment and Reduction of Personnel. - The employer may also tenninate the employment of any employee due to the installation of labor-saving devices, redundancy, retrenchment to prevent losses or the closing or cessation of operation of the establishment or undertaking unless the closing is for the purpose of circumventing the provisions of this Title, by serving a written notice on the workers and the Ministry of Labor and Employment at least one (1) month before the intended date thereof. In case of tennination due to the installation of labor-saving devices or redundancy, the worker affected thereby shall be entitled to a separation pay equivalent to at least his one (1) month pay or to at least one (1) month pay for every year of service, whichever is higher. In case of retrenchment to prevent losses and in cases of closures or cessation of operations of establishment or undertaking not due to serious business losses or financial reverses, the separation pay shall be equivalent to one (1) month pay or at least one-half (1/2) month pay for every year of service, whichever is higher. A fraction of at least six (6) months shall be considered one (1) whole year.
99 283 Phil. 1 (1992) [Per J. Cruz, First Division].
100 Id. at 6.
101 LABOR CODE, art. 278 provides:
Article 278 - Strikes, Picketing and Lockouts-
....
(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 return to work and the employer 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.
102Rollo, pp. 821-823. Order.
103YSS Employees Union-Philippine Transport and General Workers Organization v. YSS Laboratories, Inc., 622 Phil. 201, 212-213 (2009) [Per J. Chico-Nazario, Third Division].
104 347 Phil. 447 (1997) [Per J. Bellosillo, First Division].
105 Id. at 456.
106 Id.
107 Id. at 461.
108 501 Phil. 704 (2005) [Per J. Chico-Nazario, Second Division].
109 Id. at 715.
110Rollo, pp. 96-113.
111 Id. at 112-113.
112 Id. at 674-677.
113 596 Phil. 510 (2009) [Per J. Carpio Morales, En Banc].
114Rollo, p. 1108.
115Garcia v. Philippine Airlines, 596 Phil. 510, 536 (2009) [Per J. Carpio Morales, En Banc].
116 Art. 294 was formerly Art. 279, before it was renumbered by DOLE Department Advisory No. 1, Series of 2015.
117Golden Ace Builders, et al. v. Talde, 634 Phil. 364, 370 (2010) [Per J. Carpio Morales, First Division].
118 Art. 224 was formerly Art. 217, before it was renumbered by the DOLE Department Advisory No. 1, Series of 2015.
LABOR CODE, art. 224 provides:
Art. 224. Jurisdiction of the Labor Arbiters and the Commission.
(a) Except as otherwise provided under this Code, the Labor Arbiters shall have original and exclusive jurisdiction to hear and decide, within thirty (30) calendar days after the submission of the case by the parties for decision without extension, even in the absence of stenographic notes, the following cases involving all workers, whether agricultural or non-agricultural: (1) Unfair labor practice cases; (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 (P5,000.00) regardless of whether accompanied with a claim for reinstatement. (b) The Commission shall have exclusive appellate jurisdiction over all cases decided by Labor Arbiters. (c) Cases arising from the interpretation or implementation of collective bargaining agreements and those arising from the interpretation or enforcement of company personnel policies shall be disposed of by the Labor Arbiter by referring the same to the grievance machinery and voluntary arbitration as may be provided in said agreements.
119Nacar v. Gallery Frames, 716 Phil. 267, 282-283 (2013) [Per J. Peralta, En Banc].