Sta. Mesa Slipways & Engineering Co. v. Court of Industrial Relations
REITERATIONFacts
The Antecedents: Petitioner, Sta. Mesa Slipways & Engineering Company, Inc., a domestic corporation engaged in vessel and barge construction and repair, employed laborers, including respondents Macario Tadina et al., under verbal contracts for no fixed period, paid weekly or hourly. On April 26, 1949, the company posted a notice of a work stoppage for inventory from April 30, 1949, for at least two weeks, affecting some but not all laborers. Upon the inventory's conclusion, the respondents were not allowed to resume work, and later informed they would be called, though they had been paid up to the stoppage date. Procedural History: Macario Tadina and thirty-six fellow laborers filed an action with the Court of Industrial Relations (CIR), alleging they were not given the one-month notice required by Article 302 of the Code of Commerce and seeking compensation in lieu thereof. The Company moved to dismiss, questioning the CIR's jurisdiction and arguing the claim lacked legal basis as the laborers were paid hourly. During proceedings, ten laborers settled amicably, reducing the petitioners to twenty-seven. The CIR denied the motion to dismiss, and after a partial stipulation of facts, ruled in favor of the laborers, ordering the Company to pay them one month's wages with interest. The Company now seeks review of this decision via certiorari. The Petition: The petitioner seeks review of the CIR's decision through a petition for certiorari, raising two main legal questions: (1) the applicability of Article 302 of the Code of Commerce to the laborers' employment, which was paid hourly and weekly, and (2) the jurisdiction of the CIR, given the dispute arose from a lay-off and the number of affected laborers initially numbered thirty-seven but later reduced to twenty-seven. The petitioner argues that the employment had a fixed term (weekly/hourly basis) and that the CIR lacked jurisdiction as the number of laborers fell below the thirty-one required by Commonwealth Act 103, and the dispute did not necessarily cause a strike or lockout.
Issue(s)
Whether Article 302 of the Code of Commerce is applicable to the employment of the respondent laborers. Whether the Court of Industrial Relations has jurisdiction over the case.
Ruling
The Supreme Court affirmed the decision of the Court of Industrial Relations. The petition for certiorari was denied.
Ratio Decidendi
On the applicability of Article 302 of the Code of Commerce: The Court held that the manner of payment, whether daily or weekly, and the basis of computation (hourly work), do not determine the term of employment. These only serve to compute the wages earned. Since the employment contracts were for no fixed or definite period, they fall under Article 302 of the Code of Commerce, which requires one month's advance notice for termination. The laborers were laid off without just cause and without the required notice, thus entitling them to compensation equivalent to one month's salary. The Court reiterated the principle from Sanchez vs. Harry Lyons Construction, Inc. that the mode of payment does not define the period of employment. Furthermore, the Court noted that even if Article 302 were not strictly applicable, the Court of Industrial Relations, by virtue of its general jurisdiction over labor disputes, could grant such compensation as a matter of discretion, provided it is not abused. The Court also cited Lopez vs. Roces to support the entitlement of any employee discharged without just cause to an indemnity of one month's salary when notice is not given, regardless of whether the employer is strictly a commercial company. On the jurisdiction of the Court of Industrial Relations: The Court found that all four requisites for CIR jurisdiction under Commonwealth Act No. 103 were present: an industrial dispute, arising from differences regarding dismissals/lay-offs, with more than thirty employees affected (initially 37). The Court clarified that the dispute caused or was likely to cause a strike or lockout, considering the laborers' inability to resume work after the inventory as a form of lockout. The Court emphasized that a lockout, like a strike, constitutes a suspension of services and falls within the CIR's purview. The reduction of the number of affected laborers to 27 due to amicable settlements did not divest the CIR of its jurisdiction, as established in cases like Pepsicola, Inc. vs. National Labor Union and Manila Hotel Employees Association vs. Manila Hotel, where it was held that once jurisdiction is acquired, it is retained until the case is completely decided.
Main Doctrine
The manner of payment (daily, weekly, or monthly) does not determine the term of employment; employment paid on such bases, if without a fixed period, falls under Article 302 of the Code of Commerce, entitling laborers to one month's salary in lieu of notice upon separation without just cause. The Court of Industrial Relations has jurisdiction over such disputes, even if the number of affected laborers falls below the statutory minimum after amicable settlements, provided jurisdiction was initially acquired.