United Seamen's Union of the Philippines vs. Davao Shipowners Association

A strike is illegal and unjustified when it is staged to compel union recognition despite an existing collective bargaining agreement and in violation of the agreement's grievance and no-strike procedure, and when it is carried out through violence, coercion, intimidation, and unauthorized taking of property.

The United Seamen's Union of the Philippines (USUP) sought to represent crewmen of shipping companies belonging to the Davao Shipowners Association. Those crewmen were already members of the Davao Marine Association, which had an existing collective bargaining agreement with the Shipowners effective through the end of 1959, containing grievance and no-strike provisions and management prerogatives over hiring, promotion, transfer, suspension, lay-off, and discharge. The dispute implicated Republic Act No. 875's unfair labor practice provisions and the statutory scheme for certification elections and peaceful settlement of labor disputes. A related complaint by the Davao Marine Association against USUP was pending in the Davao Court of First Instance as Civil Case No. 3106.

On August 4, 1959, USUP presented a set of demands to the Davao Shipowners Association, representing the respondent shipping companies, for union recognition, union security, standardization of wages, and other benefits. The Shipowners answered by pointing to an existing collective bargaining agreement with the Davao Marine Association, to which all crewmen of their launches belonged, effective until the end of 1959, and suggested that USUP first take steps to be certified as the collective bargaining agent before negotiation. Before receiving that answer, USUP had already filed a notice of strike with Regional Office No. 8 of the Department of Labor in Davao City against the individual shipowners. After a conference, on August 20, 1959, USUP, the Shipowners, and the Association executed a covenant: USUP withdrew the strike notice and undertook to preserve the status quo in loading, unloading, departures, manning, and all jobs incident to the shipowners' businesses in Davao City and outports; the Association agreed to cooperate and withdraw its complaint in Civil Case No. 3106; USUP bound itself to respect the CBA until expiry and not impair or disturb it, but would file a CIR petition for certification election and, if certified, bargain after the contract expired; and the Shipowners gave their conformity to the agreement and the commitment to have the CIR determine union representation. USUP then filed the certification election petition.

After the covenant, the respondent shipping companies separately served notices of termination on sixty-four employees effective December 31, 1959, for reasons ranging from stoppage of operations due to the death of a partner to business losses and reversals. The affected employees were USUP members who were also Association members. USUP reported the matter to Regional Office No. 8 and requested assistance; the Regional Office called a conference but it did not resolve the dispute. In a letter dated December 29, 1959, USUP formally notified the Regional Office, Department of Labor, the City Mayor of Davao, the Chief of Police, the Philippine Constabulary, the Bureau of Customs, and the general public that it would declare a strike on January 1, 1960.

On February 11, 1960, the shipping companies filed a petition for a writ of injunction, docketed as Case No. 3-INJ-DB, with the CIR, alleging that a restraining order was necessary to forestall substantial and irreparable damage to their properties and the public weal, and citing specific acts of coercion, violence, and illegal picketing. On February 24, 1960, USUP filed an unfair labor practice case, docketed as Case No. 49-ULP-DB, alleging that while its certification election petition was pending, the respondents interfered with the employees' right to self-organization and discriminated in hire, tenure, and conditions of employment to deter organizational activity, induce organized employees to drop out, disrupt union morale, and break up the union. The ULP case was predicated on the dismissal of USUP members and invoked section 4(a), subsections (1), (2), and (4) of Republic Act No. 875. The injunction and ULP cases were heard and tried jointly.

The CIR found that the strike and the ULP case were the culmination of a series of drastic moves designed to compel the respondents to recognize USUP as the employees' collective bargaining agent to the exclusion of the Association, with which the Shipowners had an existing CBA; the effort was legally infirm from its inception. It noted that USUP filed its notice of strike even before receiving the Shipowners' answer, indicating a predisposition to strike despite awareness of the valid CBA. It also found that the strike contravened the August 20 covenant and impaired the status quo and the existing CBA, which recognized the employer's right to hire, promote, transfer, and for legal cause suspend, lay off, or discharge employees, subject to the union's right to notification and reconsideration. USUP claimed the strike was self-defense or union survival because the shipping companies allegedly violated the covenant by terminating sixty-four USUP members, but the CIR found the Shipowners were not active or principal parties to the covenant and that, even assuming they were bound, the terminations were based on legitimate reasons.

As to the terminations, the CIR found that Angtiong Sons had terminated only the crewmen of the MERCURY on November 12, 1959 due to sustained losses; the notices were directed to them as Association members, not as USUP members, and copies were furnished the Association president and the Department of Labor. The decommissioning, sale, and disposal of the MERCURY negated the unfair labor practice charge and fell under the CBA's Management of Labor Force provision. Southern Navigation Company's crew and officers of the EMPRESS OF DAVAO and the ANHAI received termination notices because the company was dissolved after the death of a principal partner; the cessation was not motivated by anti-union feeling, and the notices were addressed to the Association under the CBA. Vicente Yu Water Transportation's notices stated that the planned cessation of operations of the M/L WATSON and M/L RIZAL was temporary and were addressed to all crewmen and officers as Association members, not USUP members. For Joyce Enterprises, Anglionto Sons & Co., Garcia Water Transportation, and Garcia Navigation, the CIR found no retaliatory intent: the shipowners did not dismiss or lock out Association members who were also USUP members at earlier opportunities, including after the demand letter, the notice of strike, or the injunction order.

The CIR also found that the strike was carried out through violence, coercion, intimidation, and unauthorized taking of property. On the night of December 31, 1959, about three hundred strikers led by Alvaro Trinidad formed a human cordon at Sta. Ana wharf, blocked approaches to the vessels, and obstructed loading and unloading, including boats loaded with perishable commodities. Strikers took possession of the lanchita of the M/V ALFONSO on January 4, 1960, the M/L COLUMBIAN on January 7, 1960, and the bote of the M/V ISABEL on January 18, 1960, without authority. On January 2, 1960, strikers grabbed a gangplank and pushed it against stevedores, causing injuries and preventing unloading. On January 4, 1960, Trinidad challenged William Joyce to a fight in the presence of a peace officer. On January 8, 1960, Benedicto Erespe was surrounded and threatened with bodily harm; on January 14, 1960, Blas Nicase and the crew of the M/L MALITA were prevented from working and intimidated. On January 13, 1960, Pablo Sisa, a non-striker, was mauled by six strikers upon Trinidad's orders. On January 31, 1960, about eighty strikers at Talomo Beach pushed the bote of the M/L MALITA away, untied its anchor, and caused it to drift; Manuel Garcia was pushed by strikers. On February 3, 1960, about one hundred fifty strikers blocked the M/L MALITA, grabbed a gangplank, and injured stevedores Tecson and Vargas. The CIR found these acts supported by substantial evidence, corroborated by the City Fiscal and peace officers, and not discredited by the respondents' evidence.

• Grave Abuse of Discretion: Petitioner claimed that the Court of Industrial Relations gravely abused its discretion in declaring the strike staged by USUP unjustified and illegal.
• Self-Defense/Union Survival: Petitioner asserted that the strike was a matter of self-defense and/or union survival, maintaining that the respondent shipping companies first violated the covenant to preserve the status quo by sending notices of dismissal or separation, effective December 31, 1959, to sixty-four USUP members.
• Unfair Labor Practice: Petitioner alleged that while its certification election petition was pending, the respondents interfered with the employees' right to self-organization and discriminated in hire, tenure, and conditions of employment to deter organizational activity, induce organized employees to drop out, disrupt union morale, and break up the union, in violation of section 4(a), subsections (1), (2), and (4) of Republic Act No. 875.

• Existing Collective Bargaining Agreement: Respondent Shipowners invited attention to the existing collective bargaining agreement with the Davao Marine Association, to which all crewmen of their launches belonged, and suggested that USUP first take steps to be certified as the collective bargaining agent before negotiation.
• Injunctive Relief: Respondent shipping companies alleged that a restraining order was necessary to forestall substantial and irreparable damage to their properties and the public weal, citing specific acts of coercion, violence, and illegal picketing.
• Legitimate Terminations: Respondent shipping companies contended that the dismissals were predicated on legitimate reasons, including stoppage of operations due to the death of a partner, business losses, and reversals.

• Grave Abuse of Discretion / Legality of Strike: Whether the Court of Industrial Relations gravely abused its discretion in declaring the strike staged by USUP unjustified and illegal.
• Purpose of the Strike: Whether the strike was illegal and unjustified because it was staged to compel recognition despite an existing collective bargaining agreement and in violation of the covenant and the CBA's grievance and no-strike procedure.
• Means Employed in the Strike: Whether the strike was illegal and unjustified because it was carried out through violence, coercion, intimidation, and unauthorized taking of property.
• Permanent Injunction: Whether the permanent injunction issued by the Court of Industrial Relations was proper.

• Grave Abuse of Discretion / Legality of Strike: No. The Court of Industrial Relations did not gravely abuse its discretion; the strike was illegal and unjustified.
• Purpose of the Strike: No valid purpose. The strike was designed to compel recognition despite an existing collective bargaining agreement and violated the covenant and the CBA's grievance and no-strike procedure.
• Means Employed in the Strike: No. Even assuming a valid purpose, the means employed were illegitimate because the strike was attended by violence, coercion, intimidation, and unauthorized taking of property.
• Permanent Injunction: Yes. Because the strike was illegal and unjustified, the permanent injunction issued by the Court of Industrial Relations was proper.

• Grave Abuse of Discretion / Legality of Strike: The CIR's finding that the strike and the unfair labor practice case were the culmination of a series of drastic moves to compel recognition of USUP as the employees' collective bargaining agent, to the exclusion of the Association with which the Shipowners had an existing CBA, was supported by substantial evidence. USUP filed its notice of strike even before receiving the Shipowners' answer, indicating that it was predisposed to strike and aware that the existing CBA was a legal bar to its demands. The Court found no grave abuse of discretion in the CIR's conclusion that the strike was illegal and unjustified.

• Purpose of the Strike: The August 20, 1959 covenant was bilateral and not tripartite; the active and principal parties were USUP and the Davao Marine Association, while the Shipowners merely gave conformity and assumed no definite binding obligation. Thus, USUP could not justify the strike as self-defense or union survival based on the Shipowners' alleged violation of the covenant. Even assuming the Shipowners were bound, the termination of the sixty-four employees was not a violation because the CIR found the dismissals were based on legitimate reasons. The CBA contained a grievance and hearing committee procedure and provided that pending determination of any unresolved grievance by the Court of Industrial Relations or another competent court, no strike, slowdown, or lockout would be declared. The employees, who were bound by the CBA as Association members, disregarded this graduated procedure by immediately striking. Strikes held in violation of the terms of a collective bargaining agreement are illegal, especially when the agreement provides for conclusive arbitration clauses. (Liberal Labor Union vs. Phil. Can Co., 91 Phil. 72, 78). The unlicensed crew members contravened the CBA not because they affiliated with USUP but because they failed to comply with their obligations and duties as Association members.

• Means Employed in the Strike: In cases not falling within the prohibition against strikes, the legality or illegality of a strike depends first on the purpose for which it is maintained and second on the means employed in carrying it on. If the purpose is trivial, unreasonable, or unjust, or if the strikers commit violence or cause injuries to persons or damage to property, the strike may be declared illegal. The CIR's factual findings, which USUP did not question as to veracity, showed that the strike was attended by coercion, force, intimidation, physical injuries, unauthorized taking of vessels and equipment, and threats against non-strikers and shipowners. The Court cited Luzon Marine Dept. Union vs. Roldan, 86 Phil. 507, 513, and Liberal Labor Union vs. Phil. Can Co., 91 Phil. 72, for the rule that a strike carried out with such means cannot be justified in a regime of law because it would encourage abuses and terrorism and subvert the purpose of the law providing for arbitration and peaceful settlement of labor disputes.

• Permanent Injunction: Because the strike was illegal and unjustified, the permanent injunction issued by the CIR was proper. The Court deemed it unnecessary to consider the other incidental issues presented by USUP after resolving the legality of the strike and the propriety of the injunction.

• Two-fold test for legality of a strike — In cases not falling within the prohibition against strikes, the legality or illegality of a strike depends first on the purpose for which it is maintained and second on the means employed in carrying it on. A strike may be declared illegal if the purpose is trivial, unreasonable, or unjust, or if the strikers commit violence, cause injuries to persons, or damage property. The Court applied this test to uphold the CIR's declaration that the USUP strike was illegal and unjustified.

• Illegality of strikes violating collective bargaining agreement procedures — Strikes held in violation of the terms of a collective bargaining agreement are illegal, especially when the agreement provides for conclusive arbitration clauses. The Court applied this doctrine because the CBA required grievances to be coursed through a grievance and hearing committee and prohibited strikes, slowdowns, or lockouts pending determination by the Court of Industrial Relations or another competent court.

• Covenant as bilateral, not tripartite — The August 20, 1959 covenant imposed obligations on USUP and the Davao Marine Association as the active and principal parties; the Davao Shipowners Association merely gave conformity and assumed no definite binding obligation. The Court used this to reject USUP's claim that the Shipowners' alleged violation justified the strike as self-defense or union survival.

• Management prerogative and legitimate termination — The CBA vested in the employer the exclusive right to manage the business and working forces, including the right to hire, promote, transfer, and for legal cause suspend, lay off, or discharge employees, subject to union notification and reconsideration. The Court relied on this provision in finding that the terminations were legitimate and not anti-union.

• Labor organization as wholesome or subterfuge — A labor organization is wholesome if it serves its legitimate purpose of promoting the interests of labor without unnecessary labor disputes; if it is used as a subterfuge or as a means to subvert valid commitments, it defeats its own purpose and undermines harmonious relations between management and labor. The Court applied this principle to deny approval to USUP's conduct.

• "In cases not falling within the prohibition against strikes, the legality or illegality of a strike depends first, upon the purpose for which it is maintained, and, second, upon the means employed in carrying it on." — This passage states the two-fold test governing the legality of strikes, which the Court applied to uphold the CIR's declaration that the USUP strike was illegal and unjustified.
• "The authorities are numerous which hold that strikes held in violation of the terms contained in a collective bargaining agreement are illegal, specially when they provide for conclusive arbitration clauses." — This passage articulates the rule that a strike violating CBA grievance and no-strike provisions is illegal, a central basis for rejecting USUP's position.
• "A labor organization is wholesome if it serves its legitimate purpose of promoting the interests of labor without unnecessary labor disputes. That is why it is given personality and recognition in concluding collective bargaining agreements. But if it is made use of as a subterfuge, or as a means to subvert valid commitments, it defeats its own purpose, for it tends to undermine the harmonious relations between management and labor." — This passage defines the Court's policy rationale for denying approval to a union's use of a strike to subvert valid CBA commitments.

• Liberal Labor Union vs. Phil. Can Co., 91 Phil. 72, 78 — Cited for the rule that strikes held in violation of collective bargaining agreement terms are illegal, especially when the agreement provides for conclusive arbitration clauses; also cited for the principle that a strike attended by coercion, force, intimidation, physical injuries, sabotage, and obscene language cannot be justified.
• Luzon Marine Dept. Union vs. Roldan, 86 Phil. 507, 513 — Cited for the two-fold test governing the legality of strikes and for the rule that a strike may be declared illegal if its purpose is trivial, unreasonable, or unjust, or if the strikers commit violence or cause injuries or damage.
• National Labor Union vs. Philippine Match Co., 70 Phil. 300 — Cited as an example of a strike whose purpose was trivial, unreasonable, or unjust.
• National Labor Union, Inc. vs. Court of Industrial Relations, et al., 68 Phil. 732 — Cited as an example of a strike where the strikers committed violence or caused injuries to persons or damage to property.

• Section 4(a), subsections (1), (2), and (4), Republic Act No. 875 — These unfair labor practice provisions were invoked by USUP, which alleged employer interference with the right to self-organization, requiring non-membership or withdrawal from a labor organization, and discrimination in hire or tenure to encourage or discourage union membership. The Court affirmed the dismissal of the unfair labor practice complaint as part of the decision appealed from, while focusing its ratio on the illegality of the strike.
• Article VI, Collective Bargaining Agreement dated December 28, 1957 — The Grievance and Hearing Committee provision required all grievances of union members to be coursed through a grievance committee and hearing committee, and any unresolved grievance or dispute to be referred to the Court of Industrial Relations or another competent court; pending determination, no strike, slowdown, or lockout could be declared. The Court applied this provision to hold that the employees disregarded the CBA's graduated procedure.
• Management of Labor Force provision, Collective Bargaining Agreement dated December 28, 1957 — This provision vested in the employer the operation and direction of working forces and management of the business, including the right to hire, promote, transfer, and for legal cause suspend, lay off, or discharge employees, with notice to the union and a right to seek reconsideration. The Court relied on it in finding the terminations legitimate and not anti-union.

Concepcion, C.J., Reyes, J.B.L., Dizon, Bengzon, J.P., Zaldivar, Sanchez, Castro, Angeles and Fernando, JJ., concur.