Alcantara & Sons vs. CA, September 29, 2010

Facts:
C. Alcantara & Sons, Inc., (the Company) is a domestic corporation engaged in the manufacture and processing of plywood. Nagkahiusang Mamumuo sa Alsons-SPFL (the Union) is the exclusive bargaining agent of the Company’s rank and file employees. The other parties to these cases are the Union officers and their striking members.
 
The Company and the Union entered into a CBA that bound them to hold no strike and no lockout in the course of its life. At some point, the parties began negotiating the economic provisions of their CBA but this ended in a deadlock, prompting the Union to file a notice of strike. After efforts at conciliation by the DOLE failed, the Union conducted a strike vote that resulted in an overwhelming majority of its members favoring it. The Union reported the strike vote to the DOLE and, after the observance of the mandatory cooling-off period, went on strike.
 
During the strike, the Company filed a petition for the issuance of a writ of preliminary injunction with prayer for the issuance of a temporary restraining order (TRO) Ex Parte with the NLRC to enjoin the strikers from intimidating, threatening, molesting, and impeding by barricade the entry of non-striking employees at the Company’s premises. The NLRC first issued a 20-day TRO and, after hearing, a writ of preliminary injunction, enjoining the Union and its officers and members from performing the acts complained of. Meantime, the Union filed a petition with the CA, questioning the preliminary injunction order. The latter court dismissed the petition. The Union did not appeal from such dismissal. The Company, on the other hand, filed a petition with the Regional Arbitration Board to declare the Union’s strike illegal, citing its violation of the no strike, no lockout, provision of their CBA.
 
The Labor Arbiter rendered a decision, declaring the Union’s strike illegal for violating the CBA’s no strike, no lockout, provision. As a consequence, the Labor Arbiter held that the Union officers should be deemed to have forfeited their employment with the Company and that they should pay actual damages plus 10% interest and attorney’s fees. With respect to the striking Union members, finding no proof that they actually committed illegal acts during the strike, the Labor Arbiter ordered their reinstatement without backwages.
 
At any rate, the Company did not reinstate them. Both parties appealed the Labor Arbiter’s decision to the NLRC. The NLRC rendered a decision, affirming that of the Labor Arbiter insofar as the latter declared the strike illegal, ordered the Union officers terminated, and directed them to pay damages to the Company. The NLRC ruled, however, that the Union members involved, who were identified in the proceedings held in the case, should also be terminated for having committed prohibited and illegal acts.
 
The CA rendered a decision dismissing the petition. The CA ruled that the reinstatement pending appeal provided under Article 223 of the Labor Code contemplated illegal dismissal or termination cases and not cases under Article 263. Thus, the CA ruled that the resolution ordering the reinstatement of the terminated Union members and the payment of their wages and other benefits had no basis.
 
Issue:
Whether the terminated Union members are entitled to the payment of backwages on account of the Company’s refusal to reinstate them pending appeal.

​Held:
Yes. The Company’s failure to reinstate the employees pursuant to the decision of the Labor Arbiter makes it liable for accrued backwages until the eventual reversal of the order of reinstatement by the National Labor Relations Commission (NLRC).
Although the Labor Arbiter failed to act on the terminated Union members’ motion for reinstatement pending appeal, the Company had the duty under Article 223 to immediately reinstate the affected employees even if it intended to appeal from the decision ordaining such reinstatement. The Company’s failure to do so makes it liable for accrued backwages until the eventual reversal of the order of reinstatement by the NLRC on November 8, 1999, a period of four months and nine days.