University of the Immaculate Conception v. Axalan
REITERATIONFacts
The Antecedents: Private respondent Teodora C. Axalan, a regular faculty member and elected president of the employees' union of petitioner University of the Immaculate Conception (UIC), was charged with Absence Without Official Leave (AWOL) for attending seminars in Quezon City (November 18-22, 2002) and Baguio City (January 28-February 3, 2003). Axalan claimed she conducted online classes during the first seminar and had sought approval from the Vice-President for Academics for the second seminar, though the university president denied this approval. Procedural History: An ad hoc grievance committee recommended a six-month suspension without pay for each AWOL charge, which the university president approved, resulting in a total one-year suspension. Axalan filed a complaint for illegal suspension, constructive dismissal, and unfair labor practice. The university moved to dismiss, asserting that jurisdiction lay with a voluntary arbitrator. The Labor Arbiter denied the motion, holding that no collective bargaining agreement existed and thus no grievance machinery was constituted, barring resort to voluntary arbitration. The Labor Arbiter ruled that Axalan's suspension constituted constructive dismissal and ordered reinstatement with backwages, damages, and attorney's fees. The National Labor Relations Commission (NLRC) affirmed the Labor Arbiter's decision, holding that the Labor Arbiter had jurisdiction as the controversy did not involve the union and the university. The Court of Appeals affirmed the NLRC's ruling, finding no grave abuse of discretion. The Petition: The university filed a petition for review on certiorari, arguing that the parties agreed to voluntary arbitration, that Axalan's suspension was not constructive dismissal, and that the computation of backwages was incorrect. Axalan countered that the Labor Arbiter had jurisdiction over constructive dismissal and unfair labor practice cases, that the findings of constructive dismissal were binding, and that the computation was proper.
Issue(s)
Whether the voluntary arbitrator had jurisdiction over the labor dispute. Whether Axalan was constructively dismissed. Whether the Labor Arbiter’s computation of backwages, damages, and attorney’s fees was correct.
Ruling
The petition is impressed with merit. The Supreme Court SET ASIDE the Decision of the Court of Appeals, the Resolutions of the NLRC, and the Decision of the Labor Arbiter. It ruled that the Labor Arbiter should have dismissed the complaint for lack of jurisdiction and referred the case to voluntary arbitration.
Ratio Decidendi
On the issue of jurisdiction: The Court held that Article 262 of the Labor Code provides that Voluntary Arbitrators have jurisdiction over all other labor disputes, including unfair labor practices and bargaining deadlocks, upon agreement of the parties. The Court found that the transcript of stenographic notes from the administrative hearing on February 20, 2003, clearly showed that the counsels for both parties agreed to resort to voluntary arbitration. Therefore, the Labor Arbiter should have dismissed the complaint and referred the case to the voluntary arbitrator when the university moved to dismiss for lack of jurisdiction. The Court emphasized the constitutional policy promoting the preferential use of voluntary modes in settling disputes. On the issue of constructive dismissal: The Court ruled that constructive dismissal occurs when continued employment is rendered impossible, unreasonable, or unlikely due to demotion, diminution of pay, or unbearable discrimination, leaving the employee no choice but to quit. In this case, there was no cessation of employment relations as Axalan promptly resumed teaching after her suspension expired. She never quit, thus failing to meet the crucial element of being left with no choice but to quit. Furthermore, at the time the Labor Arbiter rendered his decision, Axalan had already returned to work, making the order of reinstatement absurd. Therefore, Axalan was not constructively dismissed. On the issue of backwages, damages, and attorney's fees: Since the Court found no constructive dismissal and that Axalan was validly suspended for cause and in accord with procedural due process, there was no legal basis for the Labor Arbiter's order of reinstatement, backwages, salary differentials, damages, and attorney's fees. The university acted within its management prerogative in imposing the penalty of suspension for AWOL incidents, especially as a learning institution that cannot tolerate irresponsibility among its faculty.
Main Doctrine
The parties' agreement to resort to voluntary arbitration, as evidenced by the transcript of stenographic notes from an administrative hearing, divests the Labor Arbiter of jurisdiction over the labor dispute, even if the dispute involves termination or unfair labor practice, as per Article 262 of the Labor Code.