Jackbilt Industries, Inc. vs. Jackbilt Employees Workers Union-NAFLU-KMU

A separate petition to declare a strike illegal is not a condition sine qua non for the valid termination of employees who committed illegal acts during a strike where a prior judgment of a competent tribunal has already adjudged the illegality of those acts. The principle of conclusiveness of judgment binds the parties to the findings in a previous judgment, rendering the strike ipso facto illegal and giving the employer the legal right to terminate the offending employees pursuant to Article 264 of the Labor Code.

Petitioner Jackbilt Industries, Inc. was engaged in the business of producing concrete hollow blocks. Respondent Jackbilt Employees Workers Union-NAFLU-KMU was the collective bargaining agent of petitioner's employees. Due to the adverse effects of the Asian economic crisis on the construction industry beginning 1997, petitioner decided to temporarily stop its business, compelling most of its employees to go on leave for six months. Respondent's collective bargaining agreement with petitioner was expiring during the period of the shutdown, leading respondent to claim that the shutdown was motivated by anti-union sentiments and undertaken to avoid the duty to bargain collectively.

Jackbilt Industries, Inc. produced concrete hollow blocks, and its employees were represented by the Jackbilt Employees Workers Union-NAFLU-KMU as their collective bargaining agent. Beginning in 1997, the Asian economic crisis adversely affected the construction industry, prompting petitioner to temporarily shut down its business and compel most of its employees to go on leave for six months. Respondent immediately protested the shutdown, claiming it was undertaken to avoid the duty to bargain collectively since the collective bargaining agreement was expiring during the shutdown period. Respondent alleged the shutdown was motivated by anti-union sentiments.

On March 9, 1998, respondent went on strike. Its officers and members picketed petitioner's main gates and deliberately prevented persons and vehicles from entering or leaving the compound. Ten days later, on March 19, 1998, petitioner filed a petition for injunction with a prayer for a temporary restraining order before the NLRC, seeking to enjoin respondent from obstructing free ingress to and egress from its production facility. The NLRC issued a TRO on April 14, 1998, directing the respondents to refrain from preventing access to petitioner's property. However, reports from both the implementing officer and the investigating labor arbiter revealed that union members violated the TRO on various occasions by stopping and inspecting private vehicles entering and exiting the facility. Accordingly, in a decision dated July 17, 1998, the NLRC ordered the issuance of a writ of preliminary injunction.

Meanwhile, petitioner sent individual memoranda to the officers and members of respondent who participated in the strike, ordering them to explain why they should not be dismissed for committing illegal acts in the course of the strike. The memoranda, dated April 28, 1998, identified six specific acts including preventing free egress and ingress, preventing product deliveries, coercing employees from reporting for work, threatening reporting employees, damaging the company's image and goodwill, and other acts inimical to the company's interest. Respondent repeatedly ignored the memoranda despite extensions granted, prompting petitioner to send the memoranda again on April 18 and May 18, 1998. On May 30, 1998, petitioner dismissed the concerned officers and members and barred them from entering its premises effective June 1, 1998.

Aggrieved, respondent filed complaints for illegal lockout, runaway shop and damages, unfair labor practice, illegal dismissal and attorney's fees, and refusal to bargain against petitioner and its corporate officers. Respondent argued there was no basis for the temporary partial shutdown, which it claimed was undertaken to avoid the duty to bargain collectively. Petitioner countered that the March 9, 1998 strike was illegal for non-compliance with the procedural requirements of Article 263 of the Labor Code, and that in view of the NLRC's July 17, 1998 decision finding obstruction of free ingress and egress, it validly dismissed the employees for committing illegal acts during the strike. The labor arbiter dismissed the complaints for illegal lockout and unfair labor practice but found petitioner guilty of illegal dismissal because it had not filed a petition to declare the strike illegal before terminating the employees. The NLRC modified this decision on appeal, holding only petitioner liable for the monetary awards. The Court of Appeals further modified the NLRC decision, finding petitioner guilty of unfair labor practice based on the anti-union motivation for the shutdown and ordering increased backwages and separation pay.

• No Need for Separate Petition to Declare Strike Illegal: Petitioner asserted that the filing of a petition to declare the strike illegal was unnecessary since the NLRC, in its July 17, 1998 decision, had already found that respondent committed illegal acts in the course of the strike.
• Validity of Dismissal: Petitioner argued that pursuant to Article 264(a)(3) of the Labor Code, it validly terminated respondent's officers and employees who committed illegal acts during the strike, the illegality of those acts having been already adjudged by the NLRC.
• Illegality of the Strike: Petitioner maintained that respondent conducted the March 9, 1998 strike without observing the procedural requirements provided in Article 263 of the Labor Code, rendering the strike illegal.

• Anti-Union Motivation for Shutdown: Respondent argued that there was no basis for the temporary partial shutdown, which was undertaken by petitioner to avoid its duty to bargain collectively.
• Illegal Dismissal: Respondent contended that petitioner's termination of its officers and members constituted illegal dismissal, unfair labor practice, illegal lockout, and refusal to bargain.

• Condition Sine Qua Non: Whether the filing of a petition with the labor arbiter to declare a strike illegal is a condition sine qua non for the valid termination of employees who commit illegal acts in the course of such strike.
• Conclusiveness of Judgment: Whether the NLRC's July 17, 1998 decision, which found that respondent obstructed free ingress to and egress from petitioner's premises, precludes relitigation of the illegality of the strike acts under the principle of conclusiveness of judgment.

• Condition Sine Qua Non: No. The filing of a petition to declare a strike illegal was unnecessary because the NLRC had already adjudged the illegal acts in its July 17, 1998 decision, which bound the parties under the principle of conclusiveness of judgment.
• Conclusiveness of Judgment: Yes. The parties were bound by the NLRC's prior finding that respondent obstructed free ingress and egress, rendering the strike ipso facto illegal and giving petitioner the legal right to terminate the offending employees under Article 264 of the Labor Code.

• Condition Sine Qua Non: The principle of conclusiveness of judgment, embodied in Section 47(c), Rule 39 of the Rules of Court, provides that parties to a case are bound by the findings in a previous judgment with respect to matters actually raised and adjudged therein. The NLRC's July 17, 1998 decision had already found that respondent's officers and employees prevented the free entry into and exit of vehicles from petitioner's compound. Because the use of unlawful means in the course of a strike renders the strike illegal, the March 9, 1998 strike was ipso facto illegal by virtue of that prior adjudication. A separate petition to declare the strike illegal was therefore unnecessary, as the illegality of the acts had already been judicially determined.

• Conclusiveness of Judgment: Article 264(e) of the Labor Code prohibits any person engaged in picketing from obstructing the free ingress to and egress from the employer's premises. The NLRC's July 17, 1998 decision found that respondent violated this provision. Under the principle of conclusiveness of judgment, this finding was binding on the parties in any subsequent litigation. Article 264(a) of the Labor Code further provides that any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment right. The word "may" gives the employer the option to terminate such employees. Because the illegal acts had been adjudged in the prior NLRC decision, petitioner had the legal right to terminate respondent's officers and employees without need of a separate declaration of the strike's illegality.

• Conclusiveness of Judgment — Under Section 47(c), Rule 39 of the Rules of Court, parties to a case are bound by the findings in a previous judgment with respect to matters actually raised and adjudged therein. In this case, the NLRC's July 17, 1998 decision finding that respondent obstructed free ingress and egress was binding on the parties in subsequent litigation, precluding relitigation of whether the union committed illegal acts during the strike. This made a separate petition to declare the strike illegal unnecessary.
• Illegal Acts During a Strike — The use of unlawful means in the course of a strike renders such strike illegal. Under Article 264(a) of the Labor Code, any union officer who knowingly participates in an illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment right. The use of "may" gives the employer the option to terminate such employees.
• Obstruction of Free Ingress and Egress — Article 264(e) of the Labor Code prohibits any person engaged in picketing from obstructing the free ingress to or egress from the employer's premises for lawful purposes. Violation of this provision constitutes an illegal act in the course of a strike, rendering the strike illegal.

• "The principle of conclusiveness of judgment, embodied in Section 47(c), Rule 39 of the Rules of Court, holds that the parties to a case are bound by the findings in a previous judgment with respect to matters actually raised and adjudged therein." — This passage states the doctrinal basis for the Court's ruling, establishing that the prior NLRC finding of illegal picketing acts bound the parties and obviated the need for a separate declaration of strike illegality.
• "The use of unlawful means in the course of a strike renders such strike illegal." — This formulation defines the controlling rule for determining when a strike becomes illegal, directly linking the union's obstruction of ingress and egress to the ipso facto illegality of the March 9, 1998 strike.
• "Article 264 of the Labor Code further provides that an employer may terminate employees found to have committed illegal acts in the course of a strike." — This passage articulates the statutory basis for the employer's right to dismiss employees for illegal strike acts, confirming the validity of petitioner's termination of the union officers and members.

• Philippine Commercial International Bank vs. Alejandro, G.R. No. 175587, September 21, 2007 — Cited as authority for the principle of conclusiveness of judgment under Section 47(c), Rule 39 of the Rules of Court.
• Chuayuco Steel Manufacturing Corporation vs. Buklod ng Manggagawa sa Chuayuco Steel Manufacturing Corporation, G.R. No. 167347, January 31, 2007 — Cited for the proposition that the use of unlawful means in the course of a strike renders the strike illegal.
• G & S Transport Corporation vs. Infante, G.R. No. 160303, September 13, 2007 — Cited for the rule that an employer may terminate employees found to have committed illegal acts in the course of a strike under Article 264 of the Labor Code.
• Pilipino Telephone Corporation vs. Pilipino Telephone Corporation Employees Association, G.R. Nos. 160058 and 160059, June 22, 2007 — Cited for the interpretation that the word "may" in Article 264 gives the employer the option to terminate a union officer who participated in an illegal strike, a construction likewise applied to union members who committed illegal acts during a strike.

• Article 264(e), Labor Code — Prohibits any person engaged in picketing from obstructing the free ingress to or egress from the employer's premises for lawful purposes. Applied to find that respondent's obstruction of petitioner's gates constituted illegal picketing acts.
• Article 264(a), Labor Code — Provides that any union officer who knowingly participates in an illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment right. Applied to uphold the legality of petitioner's dismissal of the concerned employees.
• Article 263, Labor Code — Sets forth the procedural requirements for declaring a lawful strike, including notice, cooling-off period, and strike vote by secret ballot. Petitioner argued respondent failed to comply with these requirements.
• Article 217(e), Labor Code — Gives the labor arbiter original and exclusive jurisdiction to declare a strike or lockout illegal. The labor arbiter relied on this provision to find that petitioner should have filed a petition to declare the strike illegal before terminating the employees.
• Section 47(c), Rule 39, Rules of Court — Embodies the principle of conclusiveness of judgment, providing that in any litigation between the same parties, only matters actually and necessarily adjudged in a former judgment are binding. Applied to bind the parties to the NLRC's prior finding of illegal picketing acts.

Consuelo Ynares-Santiago, Antonio T. Carpio (Acting Chairperson), Teresita J. Leonardo-De Castro, and Arturo D. Brion concurred.