San Miguel Corporation v. National Labor Relations Commission
REITERATIONFacts
The Antecedents: San Miguel Corporation (SMC) shut down some plants and declared 55 positions redundant due to financial losses. The San Miguel Corporation Employees Union (SMCEU) filed grievance cases for the retrenched employees, seeking their redeployment. During the grievance proceedings, most employees were redeployed or accepted early retirement, leaving only 17. SMC informed the union that if the remaining 17 employees could not be redeployed by October 30, 1990, their services would be terminated on November 2, 1990. The union declared a deadlock. Procedural History: The union filed a notice of strike with the National Conciliation and Mediation Board (NCMB) on grounds including bargaining deadlock, union busting, gross violation of the CBA, failure to provide a list of vacant positions, and defiance of voluntary arbitration awards. SMC moved to dismiss the notice of strike, but the NCMB did not act. SMC then filed a complaint with the National Labor Relations Commission (NLRC) seeking dismissal of the notice of strike and compelling the union to submit the issues to grievance and arbitration. The NLRC dismissed SMC's complaint for lack of merit. The Petition: SMC filed a Petition for Certiorari with the Supreme Court, assailing the NLRC's resolution, arguing that the NLRC had a positive legal duty to compel arbitration and enjoin a strike in violation of a no-strike clause.
Issue(s)
Whether the NLRC committed grave abuse of discretion in dismissing San Miguel Corporation's complaint for the dismissal of the notice of strike and for compelling the union to submit to grievance and arbitration. Whether the grounds relied upon by the respondent union for the notice of strike were strikeable under the law and the Collective Bargaining Agreement.
Ruling
The Supreme Court granted the petition, reversed the resolution of the NLRC, and directed the parties to complete the third level (Step 3) of the Grievance Procedure and proceed with Arbitration proceedings if necessary. The Court held that the NLRC gravely abused its discretion in dismissing the complaint.
Ratio Decidendi
On whether the NLRC committed grave abuse of discretion in dismissing San Miguel Corporation's complaint for the dismissal of the notice of strike and for compelling the union to submit to grievance and arbitration: The Court found that the NLRC committed grave abuse of discretion. The petition was impressed with merit because the grounds relied upon by the union for the notice of strike were non-strikeable. The issues raised were either still subject to the grievance machinery or were management prerogatives exercised in good faith. The Court emphasized that a strike staged in violation of the terms of a collective bargaining agreement, especially those providing for grievance and arbitration, is illegal. The NLRC should have compelled the union to exhaust the remedies provided in the CBA rather than dismissing the complaint. On whether the grounds relied upon by the respondent union for the notice of strike were strikeable under the law and the Collective Bargaining Agreement: The Court ruled that the grounds were not strikeable. A strike or lockout may only be declared in cases of bargaining deadlocks and unfair labor practices. Violations of the CBA, except flagrant and/or malicious refusal to comply with economic provisions, are not strikeable. Issues brought to voluntary or compulsory arbitration are also not grounds for a strike. In this case, the alleged bargaining deadlock was non-existent as a Board was assigned to resolve the conflict. The union's abandonment of the grievance proceedings and refusal to avail of CBA remedies constituted a violation of the agreement by the union itself. The abolition of departments or positions is a management prerogative, and in the absence of proof of ill-motive, the company is presumed to have acted in good faith, especially since most employees were redeployed.
Main Doctrine
A notice of strike filed on grounds not recognized as strikeable under the Labor Code and the Collective Bargaining Agreement, particularly when the issues raised are still subject to grievance or arbitration proceedings, is dismissible for lack of merit. Failure to exhaust the remedies provided in the grievance machinery and arbitration clauses of a CBA renders a strike illegal.