Philippine Airlines, Inc. vs. Santos, Jr.

A division head's failure to act on a grievance within the five-day period prescribed by the collective bargaining agreement results in the grievance being deemed resolved in favor of the aggrieved party, and management cannot excuse such failure by claiming the responsible officer was on leave.

The individual respondents were Port Stewards in the Catering Sub-Department of PAL's Passenger Services Department, whose duties included preparing meal orders, setting up standard equipment, and skiing, binning, and inventorying commissary supplies and equipment. They were members of the Philippine Airlines Employees Association (PALEA), which had a Collective Bargaining Agreement with PAL. Article IV, Section 2 of that CBA established a grievance machinery requiring the division head to answer a grievance within five days from the date of presentation; failure to act within that period would result in the grievance being resolved in favor of the aggrieved party. The employees had been subjected to salary deductions representing losses of inventoried items charged to them for mishandling of company property, which they resented and sought to challenge through the grievance process.

On August 21, 1984, the individual respondents, represented by their union PALEA, made a formal notice to petitioner PAL through Mr. Reynaldo Abad, Manager for Catering, regarding salary deductions made from their wages for losses of inventoried items charged to them for mishandling of company property. No action was taken on this representation. On November 4, 1984, the employees filed a formal grievance pursuant to Step 1 of the grievance machinery under Article IV, Section 2 of the PAL-PALEA CBA, raising two issues: the illegal or questionable salary deductions and the inventory of bonded goods and merchandise, which they believed should not be part of their duties as catering service personnel.

The grievance was submitted on November 21, 1984 to the office of Mr. Abad, who was at the time on vacation leave and whose secretary received the grievance. On December 5, 1984, the grievants, through the shop steward, wrote a letter to Abad's office stating that since no reply had been made to their grievance within five days as provided in the CBA, the grievance was deemed resolved in their favor. Abad returned to work on December 7, 1984, and immediately informed the grievants, scheduling a meeting for December 12, 1984. In the interim, the individual respondents refused to conduct ramp inventory: Alberto Santos, Jr. did not conduct ramp inventory on December 7, 10, and 12; Gilbert Antonio on December 10; and Regino Duran and Houdiel Magadia on December 10 and 12.

At the grievance meeting on December 12, 1984, Abad denied the employees' petition, ruling that inventory of bonded goods was part of their duty as catering service personnel and that salary deductions for losses due to mishandling were proper. On January 3, 1985, Abad issued an inter-office memorandum directing the grievants to explain why no disciplinary action should be taken against them for failing to conduct ramp inventory. The employees complied, reiterating their position that the grievance was deemed resolved in PALEA's favor because no action was taken within five days from November 21, 1984, pursuant to Article IV, Section 2 of the CBA. Abad found the explanation unsatisfactory and imposed suspensions without pay ranging from seven to thirty days depending on the number of infractions: Santos, Jr. from January 15 to April 5, 1985; Duran from January 15 to February 4, 1985; Antonio from January 15 to 21, 1985; and Magadia from January 15 to February 4, 1985.

PALEA filed another grievance seeking the lifting or hold in abeyance of the penalty, which was denied, although the suspension of one respondent named Ramos was shortened by one month and lifted on March 5, 1985. The union demanded reimbursement of salaries during the period of suspension, but PAL refused. A complaint for illegal suspension was then filed before the Arbitration Branch of the NLRC. Labor Arbiter Ceferina J. Diosana dismissed the complaint on March 17, 1986, ruling in favor of PAL. On appeal, the NLRC set aside the labor arbiter's decision, declared the suspension illegal, and ordered PAL to pay the employees their salaries corresponding to their respective periods of suspension and to delete the disciplinary action from their service records.

• Duty to Observe Status Quo: Petitioner maintained that the grievance machinery was established for both labor and management as a vehicle to resolve problems, and every employee is duty bound to present the matter before management and give the latter an opportunity to impose corrective measures, observing the status quo rather than preempting the resolution of the grievance.
• Obligation to Settle Disputes Amicably: Petitioner argued, citing Section 1, Article IV of the CBA, that respondent employees had the obligation, just as management did, to settle all labor disputes through friendly negotiations, and that Section 2 of the CBA should not be narrowly interpreted.
• Two Concurrent Requirements: Petitioner argued that before the five-day prescriptive period begins to run, two concurrent requirements must be met — presentment of the grievance and its discussion between the shop steward and the division head — and that Section 2 is not self-executing, the mere filing of the grievance not triggering the tolling of the prescriptive period.
• Personal Act of the Division Head: Petitioner argued that the grievance was a matter requiring the personal act of Mr. Abad and thus could not be delegated to another officer.

• Grave Abuse of Discretion: Whether the NLRC acted with grave abuse of discretion amounting to lack of jurisdiction in rendering its decision declaring the employees' suspension illegal.
• CBA Interpretation: Whether the five-day period under Section 2, Article IV of the PAL-PALEA CBA was triggered by the presentment of the grievance to the division head's secretary during his absence, such that the grievance was deemed resolved in favor of the employees upon his failure to act within that period.
• Validity of Suspension: Whether the employees' refusal to conduct ramp inventory, based on their good-faith belief that the grievance had been resolved in their favor, justified the imposition of suspension.

• Grave Abuse of Discretion: No. The NLRC did not act with grave abuse of discretion; judicial review in labor cases is limited to issues of jurisdiction and grave abuse of discretion, and no such abuse was shown.
• CBA Interpretation: Yes. The five-day period was triggered upon presentment of the grievance to the division head's office, and the division head's absence on leave did not toll the deadline or excuse management's failure to act.
• Validity of Suspension: No. The suspension was illegal, the employees having been justified in good faith in believing that the grievance was deemed resolved in their favor when management failed to act within the CBA-mandated period.

• Grave Abuse of Discretion: Judicial review by the Supreme Court in labor cases does not extend to evaluating the sufficiency of evidence but is limited to issues of jurisdiction and grave abuse of discretion. It was not shown that the NLRC unlawfully neglected the performance of an act which the law specifically enjoins or unlawfully excluded petitioner from the exercise of a right to which it was entitled. The NLRC's interpretation of the CBA provision and its application to the facts were consistent with the benevolent policy underlying labor laws.

• CBA Interpretation: Section 2, Article IV of the PAL-PALEA CBA provides that the division head shall answer the grievance within five days from the date of presentation, and that if he fails to act within that period, the grievance must be resolved in favor of the aggrieved party. The grievance was presented on November 21, 1984 to Abad's secretary during his vacation leave. Petitioner's argument that two concurrent requirements — presentment and discussion — must be met before the period begins to run was rejected. The grievance was duly received by Abad's secretary, and it was incumbent upon management to ensure that someone was designated to attend to the division head's duties during his absence. The fact that Abad was on leave was "of no moment," as it could not be believed that everything under his authority would stand still during his absence. Management's inadvertence in not assigning an officer-in-charge should not be borne by the employees.

• Validity of Suspension: The employees, believing in good faith that the CBA's automatic resolution provision had taken effect, could not be blamed for not conducting ramp inventory after the five-day period lapsed. The employees had first raised their complaint on August 21, 1984, and petitioner failed to act on it; it was only after a formal grievance was filed and Abad returned to work that management turned its attention to their plaints. To adopt petitioner's reasoning would allow management to delay the resolution of labor problems by claiming its officers were on leave, thereby evading the five-day deadline and leaving workers at the mercy of their employer. Such a result could not have been the intendment of the CBA provision or the benevolent policy underlying labor laws. The suspension was accordingly declared illegal.

• Social Justice in Labor Law — The law bends over backward to accommodate the interests of the working class on the humane justification that those with less privileges in life should have more privileges in law. The constitutional mandate for the promotion of labor places the workingman on an equal plane with management in negotiating for the advancement of his interests and the defense of his rights. The Court applied this doctrine by holding that employees should not suffer the consequences of management's inadvertence in failing to designate an officer-in-charge during the division head's absence.

• Judicial Review in Labor Cases — Judicial review by the Supreme Court in labor cases does not go so far as to evaluate the sufficiency of the evidence upon which the labor officer or office based its determination, but is limited to issues of jurisdiction and grave abuse of discretion. The Court applied this principle to confine its inquiry to whether the NLRC acted with grave abuse of discretion, finding none.

• Automatic Resolution of Grievances Under CBA — Where a collective bargaining agreement provides that a grievance shall be deemed resolved in favor of the aggrieved party if the division head fails to act within a specified period, the failure to act within that period — even due to the officer's leave of absence — triggers the automatic resolution in favor of the employees. Management cannot excuse its failure by claiming the responsible officer was on leave; it should have designated an officer-in-charge to handle the grievance.

• "If the Court were to follow petitioner's line of reasoning, it would be easy for management to delay the resolution of labor problems, the complaints of the workers in particular, and hide under the cloak of its officers being 'on leave' to avoid being caught by the 5-day deadline under the CBA." — This passage articulates the ratio decidendi: the Court's rejection of the argument that an officer's leave of absence tolls the CBA deadline, grounded in the policy against allowing management to manipulate grievance timelines to the detriment of labor.

• "Under the policy of social justice, the law bends over backward to accommodate the interests of the working class on the humane justification that those with less privileges in life should have more privileges in law." — This is a canonical formulation of the social justice doctrine in Philippine labor jurisprudence, frequently cited in subsequent cases involving the protective policy toward labor.

• "It is not disputed that the grievants knew that division head Reynaldo Abad was then 'on leave' when they filed their grievance which was received by Abad's secretary. This knowledge, however, should not prevent the application of the CBA." — This passage establishes that the employees' awareness of the division head's absence did not waive or negate the operation of the CBA's automatic resolution provision.

• Pan Pacific Industrial Sales, Inc. vs. NLRC, et al., 194 SCRA 633 (1991) — Cited for the rule that judicial review in labor cases is limited to issues of jurisdiction and grave abuse of discretion, not the sufficiency of evidence.
• Reliance Surety and Insurance Co., Inc. vs. NLRC, et al., 193 SCRA 365 (1991) — Cited for the principle that the sympathy of the Court is on the side of the laboring classes, grounded in both the Constitution and the one-sided relation between labor and capital.
• Dagupan Bus Company, Inc. vs. NLRC, et al., 191 SCRA 328 (1990) — Cited for the constitutional mandate to promote labor and place the workingman on an equal plane with management.
• Ditan vs. POEA, et al., 191 SCRA 823 (1990) — Cited for the social justice policy that the law bends over backward to accommodate the interests of the working class.

• Section 2, Article IV, PAL-PALEA Collective Bargaining Agreement — Establishes the grievance machinery at Step 1, requiring the division head to answer a grievance within five days from the date of presentation by inserting his decision on the grievance form, signing and dating it, and returning one copy to the shop steward. If the division head fails to act within the five-day period, the grievance must be resolved in favor of the aggrieved party. This provision was the central basis for the Court's ruling that the grievance was deemed resolved in favor of the employees when Abad failed to act within five days of presentment.
• Section 1, Article IV, PAL-PALEA Collective Bargaining Agreement — Cited by petitioner for the proposition that both labor and management have an obligation to settle all labor disputes through friendly negotiations. The Court did not dispute this provision but held that it did not override the automatic resolution mechanism in Section 2.

Narvasa, C.J., Feliciano, Nocon, and Campos, Jr., JJ., concurred.