Judric Canning Corporation vs. Inciong

A dismissal motivated by employees' solicitation of union membership is an unfair labor practice under Article 248(a) and (d) of the Labor Code, even before the union's organizational meeting or registration; and a labor official's supported factual finding of union-motivated dismissal will not be reversed merely because the order also contained an erroneous statement on prior clearance.

Judric Canning Corporation employed the six private respondents, who were members of the United Lumber & General Workers of the Philippines (ULGWP). The union activity at issue was directed at organizing a union within the company, and the case turns on the Labor Code's protection of the right to self-organization and its prohibition of employer interference and retaliation. The Implementing Rules also govern when an employer must secure prior clearance or file a report before terminating employees.

The six private respondents—Norma Pineda, Vicky Penalosa, Leonila Morales, Teresita Balmaceda, Adelina Valenzuela, and Juanita Reposar—worked for Judric Canning Corporation and belonged to the United Lumber and General Workers of the Philippines (ULGWP). They had been employed from January 1978 to August 1978 and worked continuously until their services were terminated on the ground of abandonment.

On August 19, 1978, according to the complaint, they were not allowed to report for work because of their union activities in soliciting membership in a union yet to be organized in the company, and their time cards were removed from the rack. As a result, they and their labor union filed a complaint for unfair labor practice against petitioner with Region IV of the Ministry of Labor, seeking reinstatement with full backwages. The complaint was filed on August 24, 1978.

Petitioner denied having locked out the complainants and claimed that they failed to report for work and abandoned their positions. It also denied knowledge of their union activities until August 30, 1978, when it was served notice of a petition for direct certification filed by the complainant union. Despite maintaining abandonment, petitioner offered to pay the respondents one month's severance pay.

In an affidavit executed on September 19, 1978, the private respondents stated that they campaigned to have the majority of employees sign the ULGWP membership form and filed a petition with the Ministry of Labor for certification, and that they were resented and removed because of their complaint for benefits and their campaign.

After hearing the parties, the Regional Director of Region IV of the Ministry of Labor issued an order on November 15, 1978 finding that the private respondents did not abandon their jobs but were dismissed because of their union activities. The order noted that they had been employed from January 1978 to August 1978 and had worked continuously until their services were terminated on the ground of abandonment; that petitioner did not apply for clearance; and that petitioner failed to file the report required under the Labor Code. The Regional Director ordered petitioner to reinstate them immediately with full backwages from dismissal to actual reinstatement.

• Substantial Evidence: Petitioner contended that the Regional Director's finding, affirmed by the Deputy Minister of Labor, that petitioner was guilty of unfair labor practice for terminating the respondents due to their union activities was not supported by the evidence of record.
• Timing of Union Activity: Petitioner claimed that it could not have committed unfair labor practice because the alleged dismissal took place more than four months before the union's organizational meeting and more than one year before the union's actual registration with the Labor Organization Division of the Bureau of Labor Relations.
• Prior Clearance: Petitioner claimed that the Regional Director's finding that the dismissal was conclusively presumed without valid cause because petitioner failed to apply for clearance was contrary to the Implementing Rules and Regulations and at variance with jurisprudence.

• Substantial Evidence: Whether the Regional Director's finding, affirmed by the Deputy Minister of Labor, that petitioner dismissed private respondents due to their union activities is supported by the evidence of record.
• Unfair Labor Practice and Timing: Whether petitioner can be held guilty of unfair labor practice for dismissing employees due to union activities when the dismissal allegedly occurred before the union's organizational meeting and before its actual registration.
• Prior Clearance: Whether the Regional Director's statement that the dismissal was conclusively presumed without valid cause for failure to apply for clearance is contrary to the Implementing Rules and jurisprudence and warrants reversal.

• Substantial Evidence: No. The Regional Director's finding that the private respondents were dismissed because of their union activities, affirmed by the Deputy Minister of Labor, is a factual finding supported by the record and may not be disturbed.
• Unfair Labor Practice and Timing: No. Article 248(a) and (d) of the Labor Code prohibit interference with the right to self-organization and with the formation of a labor organization; dismissing employees for soliciting union membership is unfair labor practice even before the union's organizational meeting or registration.
• Prior Clearance: No. Prior clearance was not required because the private respondents had less than one year of service, and the Regional Director's order was not based on the absence of clearance alone; it also found dismissal due to union activities and failure to file the required report.

• Substantial Evidence: The SC rejected petitioner's contention that the unfair labor practice finding was unsupported by evidence. The record showed that after the parties submitted their position papers, a hearing was held, and the Regional Director found that the private respondents did not abandon their jobs but were dismissed because of their union activities. This was a finding of fact that could not be disturbed. The SC also reasoned that the private respondents immediately filed a complaint for illegal dismissal seeking reinstatement on August 24, 1978, soon after their services were terminated on August 19, 1978; it would be illogical for them to abandon their work and then immediately file an action seeking reinstatement. There was no reason for them to abandon their work, and no employee with a family to support would abandon work knowing the acute unemployment and underemployment problem and the difficulty of looking for a means of livelihood. Petitioner's offer to pay one month's severance pay, despite its claim of abandonment, was a clear admission of arbitrary dismissal.

• Unfair Labor Practice and Timing: The SC held that the contention was without merit. Under Article 248(a) of the Labor Code, it is unfair labor practice for an employer to interfere with, restrain, or coerce employees in the exercise of the right to self-organization. Under Article 248(d), it is also unfair labor practice for an employer to initiate, dominate, assist, or otherwise interfere with the formation or administration of any labor organization, including giving financial or other support. The private respondents were dismissed because they were soliciting signatures to form a union within the plant. In their affidavit executed on September 19, 1978, they stated that they campaigned to have the majority of employees sign the ULGWP membership form and filed a petition for certification, and that they were resented and removed because of their complaint for benefits and their campaign. The SC concluded that petitioner was guilty of unfair labor practice in interfering with the formation of a labor union and retaliating against the employees' exercise of their right to self-organization.

• Prior Clearance: The SC noted that petitioner referred to the portion of the Regional Director's order stating that petitioner did not apply for clearance and that, hence, the dismissal was conclusively presumed without valid cause. The SC held that prior clearance with the Ministry of Labor was not necessary because the private respondents had been employed with petitioner for less than one year, under Section 1, Rule XIV, Book V of the Implementing Rules and Regulations. However, the questioned order finding the dismissal without just cause was not based on the absence of prior clearance alone. The Regional Director also found that the private respondents were dismissed because of their union activities and for petitioner's failure to file a report in lieu of prior clearance under Section 11, Rule XIV, Book V. The order further stated that the complainants did not abandon their jobs and were terminated because they actively campaigned and assisted in the organization of their union. The dismissal was therefore without valid cause, considering petitioner's failure to justify its action and to file the required report under the Labor Code. The Regional Director's error in stating that the dismissal was without just cause in view of the absence of prior clearance was not sufficient to warrant reversal.

• Unfair labor practice by interference with self-organization — Under Article 248(a) and (d) of the Labor Code, an employer commits unfair labor practice by interfering with, restraining, or coercing employees in the exercise of their right to self-organization, or by interfering with the formation or administration of a labor organization. The SC applied this to a dismissal of employees who were soliciting signatures for a union yet to be organized, rejecting the argument that the dismissal could not be unfair labor practice because it preceded the union's organizational meeting and registration.
• Factual findings of labor officials — Findings of fact by the Regional Director, affirmed by the Deputy Minister of Labor, especially after a hearing, are binding on the SC when supported by the evidence. The SC refused to disturb the finding that the private respondents were dismissed for union activities rather than abandonment.
• Abandonment — Abandonment is negated by the employees' immediate filing of a complaint for reinstatement and by the absence of any reason to abandon work; an employer's offer of severance pay despite claiming abandonment is an admission of dismissal. The SC applied this in rejecting petitioner's abandonment defense.
• Prior clearance and report in lieu — Prior clearance under Section 1, Rule XIV, Book V of the Implementing Rules is required only for an employee with at least one year of service in the last two years; it was not required for the private respondents, who had less than one year of service. An erroneous statement that absence of prior clearance conclusively presumes lack of valid cause does not require reversal where the order also rests on an independent finding of dismissal without just cause and failure to file the report in lieu of prior clearance under Section 11.

• "To get a job is difficult; to run from it is foolhardy." — The SC quoted the Solicitor General to reject the abandonment defense: if employment is hard to find, an employee would not run from it.
• "No employee with a family to support, like the private respondents, would abandon their work knowing fully well of the acute unemployment and underemployment problem and the difficulty of looking for a means of livelihood." — The SC used this to explain why the employees' immediate filing of the complaint and the absence of any reason to abandon negate abandonment.
• "For sure, the petitioner corporation is guilty of unfair labor practice in interfering with the formation of a labor union and retaliating against the employees' exercise of their right to self-organization." — This states the core unfair labor practice conclusion: dismissal for union solicitation is interference and retaliation.
• "The error of the Regional Director in stating that the dismissal of the private respondents was without just cause in view of the absence of prior clearance from the Ministry of Labor is, thus, not sufficient to warrant a reversal of the questioned order." — This explains why the Regional Director's erroneous prior-clearance statement does not require reversal.

• Article 248(a), Labor Code of the Philippines — Makes it unfair labor practice for an employer to interfere with, restrain, or coerce employees in the exercise of their right to self-organization. The SC applied this to the dismissal of employees who were soliciting union membership.
• Article 248(d), Labor Code of the Philippines — Makes it unfair labor practice for an employer to initiate, dominate, assist, or otherwise interfere with the formation or administration of any labor organization, including giving financial or other support. The SC applied this to petitioner's interference with the formation of the union.
• Section 1, Rule XIV, Book V, Implementing Rules and Regulations — Requires prior clearance for the dismissal of an employee with at least one year of service in the last two years. The SC applied this by holding that prior clearance was not necessary because the private respondents had less than one year of service.
• Section 11, Rule XIV, Book V, Implementing Rules and Regulations — Provides for a report in lieu of prior clearance. The SC referred to this provision in noting that the Regional Director found petitioner failed to file the required report, and that the order was not based solely on the absence of prior clearance.