Tabigue vs. International Copra Export Corporation

The NCMB is not a quasi-judicial agency, and individual employees who are not authorized by their union cannot compel voluntary arbitration of a CBA grievance; the right to present grievances to the employer under Article 255 does not include the right to submit them to voluntary arbitration.

Petitioners are employees of INTERCO and members of the INTERCO Employees/Laborers’ Union. A CBA between the union and INTERCO governed labor-management relations and provided for grievance machinery and voluntary arbitration. The NCMB is the DOLE agency with conciliation and mediation functions under Executive Order No. 126, and Rule 43 governs appeals from quasi-judicial agencies to the CA.

Juanito Tabigue and nineteen co-petitioners were employees of International Copra Export Corporation (INTERCO) and members of the INTERCO Employees/Laborers’ Union. They filed a Notice of Preventive Mediation with the Department of Labor and Employment – National Conciliation and Mediation Board (NCMB), Regional Branch No. XI, Davao City, against INTERCO for violation of the Collective Bargaining Agreement (CBA) and failure to sit on the grievance conference/meeting. The parties failed to reach a settlement before the NCMB, and petitioners requested that the case be elevated to voluntary arbitration. The NCMB set a date for the parties to agree on a Voluntary Arbitrator.

Before the parties could finally meet, INTERCO presented before the NCMB a letter of Genaro Tan, president of the union, addressed to INTERCO’s plant manager Engr. Paterno C. Tangente, stating that petitioners “are not duly authorized by [the] board or the officers to represent the union, [hence] . . . all actions, representations or agreements made by these people with the management will not be honored or recognized by the union.” INTERCO thus moved to dismiss petitioners’ complaint for lack of jurisdiction. Petitioners soon sent union president Tan and plant manager Tangente a Notice to Arbitrate, citing the “Revised Guidelines” in the Conduct of Voluntary Arbitration Procedure vis a vis Section 3, Article XII of the CBA, furnishing the NCMB with a copy thereof; INTERCO opposed the notice.

The parties having failed to arrive at a settlement, NCMB Director Teodorico O. Yosores wrote petitioner Alex Bibat and plant manager Tangente of the lack of willingness of both parties to submit to voluntary arbitration, which willingness is a pre-requisite to submit the case thereto; and that under the CBA forged by the parties, the union is an indispensable party to a voluntary arbitration but that since Tan informed INTERCO that the union had not authorized petitioners to represent it, it would be absurd to bring the case to voluntary arbitration. The NCMB Director thus concluded that “the demand of [petitioners] to submit the issues . . . to voluntary arbitration CAN NOT BE GRANTED.” He advised petitioners to avail of the compulsory arbitration process to enforce their rights. On petitioners’ Motion for Reconsideration, the NCMB Director, by letter of April 11, 2007 to petitioners’ counsel, stated that the NCMB “has no rule-making power to decide on issues [as it] only facilitates settlement among the parties to . . . labor disputes.”

Petitioners then assailed the NCMB Director’s decision via Petition for Review before the CA, which dismissed it by Resolution of October 24, 2007. Their Motion for Reconsideration having been denied, petitioners filed the present Petition for Review on Certiorari.

• Coverage of Voluntary Arbitration Guidelines: Petitioners argued that this particular case falls squarely within the purview of Section 6, Rule IV, in relation to paragraph 3, sub-paragraph 3.2, Section 4, Rule IV, of the Revised Procedural Guidelines in the Conduct of Voluntary Arbitration Proceedings.
• NCMB as Quasi-Judicial Agency: Petitioners argued that the NCMB, when exercising adjudicative powers, acts as a quasi-judicial agency.
• Appealability to the CA: Petitioners argued that final judgments, decisions, resolutions, orders, or awards of RTCs and quasi-judicial boards, like the NCMB, commissions, agencies, and instrumentalities, are appealable by petition for review to the CA.
• Technicality in Labor Cases: Petitioners argued that labor cases, as a general rule, are never resolved on the basis of technicality, especially when the substantial rights of employees are affected.
• Voluntary Arbitration under the CBA: Petitioners maintained that unsettled grievances should be referred to voluntary arbitration as called for in the CBA.
• Article 255 as Exception: Petitioners argued that the first paragraph of Article 255 of the Labor Code, which recognizes the right of an individual employee or group of employees at any time to present grievances to their employer, is meant to be an exception to the exclusiveness of the representative role of the labor organization/union.

• Lack of Jurisdiction: Respondent moved to dismiss petitioners’ complaint for lack of jurisdiction, relying on union president Genaro Tan’s letter that petitioners were not duly authorized by the union’s board or officers to represent the union and that all actions, representations, or agreements made by them with management would not be honored or recognized by the union.

• Docket Fees and Rule 43 Dismissal: Whether the CA properly dismissed the petition for failure to pay the full docket fees under Rule 43.
• NCMB as a Quasi-Judicial Agency: Whether the NCMB is a quasi-judicial agency exercising quasi-judicial functions, such that its decisions are appealable to the CA under Rule 43.
• Voluntary Arbitration and Union Authorization: Whether individual employees who are not authorized by their union may demand that their CBA grievance be submitted to voluntary arbitration.
• Article 255 and Grievance Presentation: Whether the right of individual employees or a group of employees under Article 255 of the Labor Code to present grievances to the employer includes the right to submit those grievances to voluntary arbitration.

• Docket Fees and Rule 43 Dismissal: Yes. Section 7, Rule 43 makes failure to comply with the requirements on payment of docket and other lawful fees a sufficient ground for dismissal, and petitioners gave no reason to relax the rule.
• NCMB as a Quasi-Judicial Agency: No. Under Section 22 of Executive Order No. 126, the NCMB performs conciliation and mediation functions and does not exercise quasi-judicial functions, so its decisions are not appealable to the CA under Rule 43.
• Voluntary Arbitration and Union Authorization: No. Only disputes involving the union and the company may be referred to the grievance machinery or voluntary arbitration, and petitioners were not authorized by their union to represent it.
• Article 255 and Grievance Presentation: No. The right to present grievances to the employer does not imply the right to submit the same to voluntary arbitration.

• Docket Fees and Rule 43 Dismissal: Section 7, Rule 43 provides that failure of the petitioner to comply with the requirements regarding payment of docket and other lawful fees, deposit for costs, proof of service, and contents and accompanying documents shall be sufficient ground for dismissal. The CA found the docket fees short by ₱1,000. Petitioners claimed they completed payment when they filed their motion for reconsideration before the CA. The SC acknowledged that it has, in the interest of justice, given due course to appeals despite belated payment, as in C.W. Tan Mfg. vs. National Labor Relations Commission, but petitioners offered no reason to relax the rule. The CA’s dismissal was therefore in order on this score alone.

• NCMB as a Quasi-Judicial Agency: Under Section 9(3) of the Judiciary Reorganization Act of 1980, the CA exercises exclusive appellate jurisdiction over final judgments, decisions, resolutions, orders, or awards of RTCs and quasi-judicial agencies, instrumentalities, boards, or commissions. Rule 43 applies to awards, judgments, final orders, or resolutions of or authorized by any quasi-judicial agency in the exercise of its quasi-judicial functions. An agency exercises judicial function when it has the power to determine what the law is and what the legal rights of the parties are, and then undertakes to determine these questions and adjudicate upon the rights of the parties. Quasi-judicial function applies to the action, discretion, etc. of public administrative officers or bodies required to investigate facts or ascertain the existence of facts, hold hearings, and draw conclusions from them as a basis for official action and to exercise discretion of a judicial nature. Section 22 of Executive Order No. 126 enumerates the NCMB’s functions: formulate policies, programs, standards, procedures, manuals of operation, and guidelines for effective mediation and conciliation; perform preventive mediation and conciliation; coordinate and maintain linkages; formulate policies for the promotion of cooperative and non-adversarial schemes, grievance handling, voluntary arbitration, and other voluntary modes of dispute settlement; administer the voluntary arbitration program; provide counseling and preventive mediation assistance; monitor and exercise technical supervision; and perform such other functions as may be provided by law. These are conciliatory and administrative, not quasi-judicial. The NCMB cannot therefore be considered a quasi-judicial agency. Even if the docket-fee rule were relaxed, the CA dismissal would still be sustained.

• Voluntary Arbitration and Union Authorization: The CBA provides that disputes arising from the interpretation or implementation of the Agreement or any matter affecting labor-management relations shall be subjected by the union and the company to all possibilities of conciliation through the grievance machinery; the committee shall resolve submitted problems within fifteen days after discussion; if the dispute or grievance cannot be settled or the committee fails to act within fifteen days, the union and the company agree to submit the issue to voluntary arbitration; the arbitrator is selected within seven days from notification by the aggrieved party by lottery from four qualified individuals nominated in equal numbers by both parties from the NCMB list; if the company and union representatives fail to agree within ten days, the NCMB shall name the arbitrator; the arbitrator’s decision is final and binding, but the arbitrator cannot change any provision of the Agreement; and the cost of arbitration is borne equally. Petitioners, however, were not duly authorized to represent the union. In Atlas Farms, Inc. vs. National Labor Relations Commission, the SC held that pursuant to Article 260 of the Labor Code, the parties to a CBA shall name or designate their respective representatives to the grievance machinery, and if the grievance is unsettled, it shall automatically be referred to the voluntary arbitrators designated in advance by the parties to the CBA; consequently, only disputes involving the union and the company shall be referred to the grievance machinery or voluntary arbitrators. Since the union president informed INTERCO that the union had not authorized petitioners to represent it, the union is an indispensable party but has not authorized them; the demand to submit the issues to voluntary arbitration cannot be granted.

• Article 255 and Grievance Presentation: Article 255 of the Labor Code provides that the labor organization designated or selected by the majority of the employees in an appropriate collective bargaining unit shall be the exclusive representative of the employees for collective bargaining, but an individual employee or group of employees shall have the right at any time to present grievances to their employer. Petitioners argued that this is an exception to the exclusiveness of the union’s representative role. The SC was not persuaded. The right of any employee or group of employees to present grievances to the employer does not imply the right to submit the same to voluntary arbitration. Article 255 therefore does not authorize petitioners to demand voluntary arbitration.

• NCMB is not a quasi-judicial agency — The NCMB’s functions under Section 22 of Executive Order No. 126 are conciliatory and administrative; it does not adjudicate legal rights. Its decisions are not appealable to the CA under Rule 43. Applied: the CA’s dismissal was affirmed.

• Quasi-judicial function test — An agency exercises judicial function when it has the power to determine what the law is and what the legal rights of the parties are, and then undertakes to determine these questions and adjudicate upon the rights of the parties. Quasi-judicial function applies to public administrative officers or bodies required to investigate facts or ascertain the existence of facts, hold hearings, draw conclusions from them as a basis for official action, and exercise discretion of a judicial nature. Applied: the NCMB’s functions do not meet this test.

• Only union-company disputes go to grievance machinery and voluntary arbitration — Under Article 260 of the Labor Code and Atlas Farms, Inc. vs. National Labor Relations Commission, parties to a CBA designate their representatives to the grievance machinery; if the grievance is unsettled, it is automatically referred to the voluntary arbitrators designated in advance; only disputes involving the union and the company may be referred to the grievance machinery or voluntary arbitrators. Applied: petitioners, not authorized by the union, cannot demand voluntary arbitration.

• Article 255 right to present grievances is not a right to voluntary arbitration — An individual employee or group of employees may present grievances to the employer at any time, but this does not imply the right to submit the same to voluntary arbitration. Applied: petitioners’ Article 255 argument was rejected.

• Rule 43 dismissal for nonpayment of docket fees — Failure to comply with the requirements regarding payment of docket and other lawful fees is a sufficient ground for dismissal under Section 7, Rule 43. Applied: the CA’s dismissal was affirmed; no reason was shown to relax the rule.

• Relaxation of procedural rules is not a matter of right — The SC may relax the rule in the interest of justice, but petitioners must show a reason for relaxation. Applied: belated payment of docket fees did not save the petition.

• “A[n agency] is said to be exercising judicial function where [it] has the power to determine what the law is and what the legal rights of the parties are, and then undertakes to determine these questions and adjudicate upon the rights of the parties.” — This definition was used to distinguish the NCMB’s conciliatory and administrative functions from quasi-judicial adjudication.
• “Consequently only disputes involving the union and the company shall be referred to the grievance machinery or voluntary arbitrators.” — This Atlas Farms rule was applied to hold that petitioners, not authorized by their union, could not demand voluntary arbitration.
• “The right of any employee or group of employees to, at any time, present grievances to the employer does not imply the right to submit the same to voluntary arbitration.” — This rejects petitioners’ argument that Article 255 of the Labor Code authorizes them to submit their grievance to voluntary arbitration.
• ”[t]he failure of the petitioner to comply with any of the foregoing requirements regarding the payment of the docket and other lawful fees, the deposit for costs, proof of service of the petition, and the contents of and the documents which should accompany the petition shall be sufficient ground for the dismissal thereof.” — This is the procedural rule the SC applied in affirming the CA’s dismissal for short payment of docket fees.

• Atlas Farms, Inc. vs. National Labor Relations Commission, 440 Phil. 620 (2002) — Controlling precedent; followed to hold that only disputes involving the union and the company may be referred to the grievance machinery or voluntary arbitration.
• C.W. Tan Mfg. vs. National Labor Relations Commission, G.R. No. 79596, February 10, 1989, 170 SCRA 240, 244 — Cited to acknowledge that the SC has given due course to appeals despite belated payment of docket fees in the interest of justice, but the exception was not applied because petitioners offered no reason to relax the rule.
• Metropolitan Bank and Trust Company, Inc. vs. National Wages and Productivity Commission, G.R. No. 144322, February 6, 2007, 514 SCRA 346 — Cited for the definition of judicial and quasi-judicial functions used to test the NCMB.

• Section 7, Rule 43, Rules of Court — Failure to comply with the requirements on payment of docket and other lawful fees, deposit for costs, proof of service, and contents and accompanying documents is a sufficient ground for dismissal; applied to affirm the CA dismissal.
• Section 9(3), Judiciary Reorganization Act of 1980 (Batas Pambansa Blg. 129) — The CA has exclusive appellate jurisdiction over final judgments, decisions, resolutions, orders, or awards of RTCs and quasi-judicial agencies, instrumentalities, boards, or commissions; applied but the NCMB is not quasi-judicial.
• Section 1, Rule 43, Rules of Court — Rule 43 applies to awards, judgments, final orders, or resolutions of a quasi-judicial agency in the exercise of quasi-judicial functions; applied to hold the NCMB outside Rule 43.
• Section 22, Executive Order No. 126 — Enumerates the NCMB’s functions; applied to show that the NCMB performs mediation, conciliation, and administrative functions, not quasi-judicial adjudication.
• Article 260, Labor Code — Parties to a CBA shall name or designate representatives to the grievance machinery; an unsettled grievance is automatically referred to the voluntary arbitrators designated in advance; only union-company disputes may be referred; applied through Atlas Farms.
• Article 255, Labor Code — The union is the exclusive representative for collective bargaining, but an individual employee or group may present grievances to the employer; applied to hold that this does not include the right to submit grievances to voluntary arbitration.