On May 29, 2009, private respondent Coca-Cola Bottlers Philippines, Inc. (CCBPI) issued notices of termination to twenty-seven (27) rank-and-file regular employees and members of the San Fernando Rank-and-File Union (SACORU), collectively referred to as “union members”, on the ground of redundancy due to the ceding out of two selling and distribution systems, the Conventional Route System (“CRS”) and Mini Bodega System (“MB”) to the Market Execution Partners (“MEPS”), better known as “Dealership System”.
The termination of employment was made effective on June 30, 2009, but the union members were no longer required to report for work as they were put on leave of absence with pay until the effectivity date of their termination. The union members were also granted individual separation packages, which twenty-two (22) of them accepted, but under protest.
To SACORU, the new, reorganized selling and distribution systems adopted and implemented by CCBPI would result in the diminution of the union membership amounting to union busting and to a violation of the Collective Bargaining Agreement (CBA) provision against contracting out of services or outsourcing of regular positions; hence, they filed a Notice of Strike with the National Conciliation and Mediation Board (NCMB) on June 3, 2009 on the ground of unfair labor practice.
On the other hand, CCBPI contends that the new business scheme is basically a management prerogative designed to improve the system of selling and distributing products in order to reach more consumers at a lesser cost with fewer manpower complement, but resulting in greater returns of investment.
The NLRC dismissed the complaint for unfair labor practice and declared as valid the dismissal of the employees due to redundancy. Upon appeal, the Court of Appeals found that the NLRC did not commit grave abuse of discretion.
Issues:
- Whether CCBPI validly implemented its redundancy program;
- Whether CCBPI’s implementation of the redundancy program was an unfair labor practice; and
- Whether CCBPI should have enjoined the effectivity of the termination of the employment of the 27 affected union members when the DOLE Secretary assumed jurisdiction over their labor dispute.
Ruling:
The petition is partly granted.
The Court cannot evaluate the evidence that the parties presented to the NLRC and CA. Following the ruling in Montoya v. Transmed Manila Corp., only questions of law may be raised against the CA decision and that the CA decision will be examined only using the prism of whether it correctly determined the existence of grave abuse of discretion.
Grave abuse of discretion may arise when a lower court or tribunal violates or contravenes the Constitution, the law or existing jurisprudence. As held in Banal III v. Panganiban, grave abuse of discretion means such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction. The abuse of discretion must be grave as where the power is exercised in an arbitrary or despotic manner by reason of passion or personal hostility and must be so patent and gross as to amount to an evasion of positive duty or to a virtual refusal to perform the duty enjoined by or to act at all in contemplation of law.
The CA only had to determine the existence of grave abuse of discretion. As held in Soriano, Jr. v. NLRC, as a general rule, in certiorari proceedings under Rule 65 of the Rules of Court, the appellate court does not assess and weigh the sufficiency of evidence upon which the Labor Arbiter and the NLRC based their conclusion.
The Court finds that the CA was correct in its determination that the NLRC did not commit grave abuse of discretion.
CCBPI’s redundancy program is valid. For there to be a valid implementation of a redundancy program, the following requisites should be present: (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.
CCBPI did not commit an unfair labor practice. In Zambrano v. Philippine Carpet Manufacturing Corp., the Court stated that unfair labor practice refers to acts that violate the workers’ right to organize. To prove the existence of unfair labor practice, substantial evidence has to be presented.
CCBPI violated the return-to-work order. As characterized by the Court in Manggagawa ng Komunikasyon sa Pilipinas v. Philippine Long Distance Telephone Co., Inc., a return-to-work order is interlocutory in nature, and is merely meant to maintain status quo while the main issue is being threshed out in the proper forum. This is to avoid any disruption to the economy and to the industry of the employer while the DOLE Secretary or the NLRC is resolving the dispute.
