University of the Immaculate Conception, Inc. vs. The Hon. Secretary of Labor and Employment, University of the Immaculate Conception Teaching and Non-Teaching Employees Union-FFW

A collective bargaining agreement, like all contracts, requires clear indications that the parties reached a meeting of the minds; where material items such as the computation of the net incremental proceeds remain unsettled, no CBA is concluded and the parties remain duty-bound to negotiate a new one in good faith. Additionally, the findings of fact of the Court of Appeals, when supported by substantial evidence, are conclusive and binding on the parties and are not reviewable by the Supreme Court in an appeal via certiorari, unless the case falls under any of the recognized exceptions.

The University of the Immaculate Concepcion, Inc. is a non-stock, non-profit educational institution with campuses at Fr. Selga St. and Bonifacio St., Davao City. The University of the Immaculate Concepcion Teaching and Non-Teaching Employees Union-FFW is the labor organization representing the University's teaching and non-teaching employees. The dispute concerns the negotiation of a collective bargaining agreement between the University and the Union, conducted under the auspices of the National Conciliation and Mediation Board (NCMB), and the strike staged by the Union after negotiations broke down. The statutory backdrop includes Article 263(g) of the Labor Code, which authorizes the Secretary of Labor to assume jurisdiction over a labor dispute, and Republic Act No. 6728, which governs the incremental proceeds of tuition fee increases.

The University of the Immaculate Concepcion, Inc. is a non-stock, non-profit educational institution with campuses at Fr. Selga St. and Bonifacio St., Davao City. The University of the Immaculate Concepcion Teaching and Non-Teaching Employees Union-FFW is the labor organization representing its teaching and non-teaching employees. On May 14, 1994 and May 28, 1994, the University and the Union met under the auspices of the National Conciliation and Mediation Board (NCMB) to negotiate a collective bargaining agreement.

On June 20, 1994, the Union filed with the NCMB its first Notice of Strike, alleging deadlock in the CBA negotiations and unfair labor practices on the part of the University in the form of mass termination of teaching and non-teaching employees, interference with union activities, discrimination, and harassment. The University denied the allegations in its Motion to Strike Out Notice of Strike. During the conciliation conference before the NCMB on July 20, 1994, the parties reached an agreement on the economic package — an increase equivalent to 75% of the increment increase of tuition fees for the first year and 80% for each of the second and third years — and on several non-economic issues, including union recognition and security, working schedule, and salaries and wages. On the coverage of the bargaining unit, further consultations were to be made on the proposed exclusion of secretaries, registrar, accounting employees, and guidance counselor. At the subsequent conciliation conference of July 26, 1994, the parties agreed to submit to voluntary arbitration the issue concerning the exclusion of confidential employees from the collective bargaining unit, and the case was deemed settled and closed.

On November 8, 1994, the panel of voluntary arbitrators rendered a decision excluding the secretaries, registrars, cashiers, guidance counselors, and the chief of the accounting department of the University from the coverage of the bargaining unit. Twenty days later, on November 28, 1994, the University presented to the Union a draft of the CBA. After a study thereof, the Union rejected the draft on the ground that the manner of computing the net incremental proceeds had yet to be agreed upon by the parties. In its letter to the Union dated December 12, 1994, the University insisted that the Union was bound to comply with the terms contained in the draft CBA since said draft allegedly embodied all the items agreed upon by the parties during the conciliation sessions held by the NCMB.

On December 9, 1994, the Union filed its second Notice of Strike with the NCMB, alleging bargaining deadlock on the allocation of 5% (CBA) and the distribution/computation of the 70% incremental proceeds under RA 6728, and unfair labor practice by the University in the form of harassments, union busting, and correct implementation of COLA. Barely three days later, on December 12, 1994, the University terminated the employment of union member Gloria Bautista; on December 27, 1994, it likewise terminated the employment of union board member Corazon Fernandez. As a consequence, Bautista and Fernandez filed complaints for illegal dismissal before the Regional Arbitration Branch No. XI of the National Labor Relations Commission in Davao City. On January 4, 1995, the University filed with the NLRC Regional Arbitration Branch No. XI a complaint against the Union and its officers for unfair labor practices, alleging that the Union refused to answer its CBA proposals in writing within the period required by law; refused to bargain in good faith by declaring a deadlock after just two days of negotiations; refused to comply with its promise to submit the final draft of the CBA agreed upon in the NCMB and refused to sign the draft prepared by the University on the ground that there was still a deadlock; resorted to another notice of strike despite a no-strike, no-lockout clause, a grievance procedure, and voluntary arbitration; and filed a complaint for illegal dismissal of Bautista without resorting to the grievance procedure and voluntary arbitration. The complaint was elevated by the NLRC Regional Arbitration Branch to the Secretary of Labor.

The conciliation conference called by the NCMB on January 4, 1995 failed to bridge the differences between the parties. The NCMB in Region XI conducted a strike-vote balloting, the outcome of which revealed that the majority of the union members voted in favor of holding a strike. On January 20, 1995, the Union went on strike. Three days later, on January 23, 1995, the Secretary of Labor issued an order assuming jurisdiction over the labor dispute pursuant to Article 263(g) of the Labor Code, directing all workers to return to work within twenty-four hours upon receipt of the order and management to accept them back under the same terms and conditions prior to the strike, directing the parties to cease and desist from committing any or all acts that might exacerbate the situation, and requiring the parties to submit their respective position papers. The Union filed a Motion for Reconsideration seeking a categorical declaration that the return-to-work order also covered Bautista and Fernandez, who had been dismissed during the pendency of the notice of strike. Before the Secretary could act on the motion, the University suspended five union members for failing to report to work within the period specified by the Secretary, and, invoking the ruling of the voluntary arbitrators that certain classes of employees cannot be part of the bargaining unit, terminated the employment of twelve union members — supposedly holders of confidential positions — for refusing to resign from the Union. On March 10, 1995, the Union filed its third Notice of Strike, alleging mass termination of employees, continuous intimidation of union members, and defiance by the University of the January 23, 1995 order of the Secretary of Labor. On March 28, 1995, the Secretary issued an order reiterating the directives contained in the January 23, 1995 order, consolidating the March 10, 1995 notice of strike with the dispute, and suspending the effects of the suspension and termination of fourteen named union members pending determination of the legality thereof, directing that they be accepted back to work under the same terms and conditions prevailing prior to the work stoppage.

The University filed three successive Motions for Partial Reconsideration, all of which were denied by the Secretary. Dissatisfied, the University went to the Supreme Court on a petition for certiorari, which was referred to another Division of the Court. On February 27, 1997, Conciliator-Mediators Mario F. Santos and Leodegario M. Teodoro went to Davao City to help the parties come up with a settlement regarding their labor dispute. During the conciliation held in the afternoon of the same day, the Union stated that there was no CBA to speak of because what were agreed upon during the conciliation conference on July 26, 1994 did not reflect the true intention of the parties and there was misunderstanding on the economic package; the Union manifested its intention to reopen the negotiation of all the proposals including those that were previously agreed upon, and proposed economic and non-economic items for negotiation. During the conciliation held in the morning of February 28, 1997, the University contended that an agreement was reached during the conciliation conferences on July 20 and 26, 1994, and presented two options for negotiation: negotiate a new five-year CBA effective SY 97-98, or sign and implement the CBA for three years and reopen for the last two years the economic provisions. The parties failed to reach an agreement on any of their respective proposals and requested the Secretary to resolve the labor dispute. On February 26, 1998, the Union filed an Urgent Motion to Resolve the case, which the Secretary received on March 9, 1998.

Finding the strike staged by the Union to be legal, the Secretary of Labor resolved the labor dispute between the University and the Union by directing the parties to execute a collective bargaining agreement. The Secretary declined to grant the Union's proposal to reopen the negotiation and, guided by the agreements reached by the parties, fixed salary increases at 75% of the increment increase of tuition fees for the first year and 80% for each of the second and third years, to be distributed in accordance with DECS Order No. 15, Series of 1992; ruled that the strike undertaken by the Union in January 1995 was a valid exercise of the workers' rights under the Labor Code, the Union having observed the mandatory requirements and procedures for a valid strike and the issues raised in the notice of strike — bargaining deadlock and unfair labor practice — being strikeable issues under Article 263(c) of the Labor Code; and directed the University and the Union to execute a CBA embodying the dispositions contained therein as well as all items agreed upon by the parties, effective for five years starting SY 1995-96, subject to renegotiation of the economic provisions for the last two years. Both parties filed motions for partial reconsideration, which the Secretary denied in a Resolution dated September 10, 1999. The Court of Appeals found that there was still no new collective bargaining agreement because the parties had not reached a meeting of the minds, and that there are many items in the draft CBA that were not even mentioned in the minutes of the July 20, 1994 conference.

• Concluded CBA: Petitioner insisted that a new collective bargaining agreement was concluded through the conciliation proceeding before the NCMB on all issues specified in the notice of strike, and that the draft CBA it presented embodied all the items agreed upon by the parties during the conciliation sessions held by the NCMB.
• Binding Effect of the Draft CBA: Petitioner maintained that the Union was bound to comply with the terms contained in the draft CBA since said draft allegedly embodied all the items agreed upon by the parties during the conciliation sessions.

• Affirmance of the Secretary of Labor's Orders: Whether the Court of Appeals erred in affirming the orders of the Secretary of Labor and Employment.

• Affirmance of the Secretary of Labor's Orders: No. The Court of Appeals did not err in affirming the orders of the Secretary of Labor and Employment, its findings of fact being supported by substantial evidence and conclusive on the parties, and no CBA having been concluded because the parties had not reached a meeting of the minds.

• Affirmance of the Secretary of Labor's Orders: The issue raised involves a re-examination of the factual findings of the Court of Appeals. In an appeal via certiorari, the Supreme Court may not review the findings of fact of the Court of Appeals. When supported by substantial evidence, the findings of fact of the Court of Appeals are conclusive and binding on the parties and are not reviewable by the Supreme Court, unless the case falls under any of the exceptions to the rule. Petitioner failed to prove that the case falls within the exceptions. It is not the function of the Court to review, examine, and evaluate or weigh the probative value of the evidence presented; a question of fact would arise in such event, and questions of fact cannot be raised in an appeal via certiorari before the Supreme Court and are not proper for its consideration. Nevertheless, the Court found that the Court of Appeals did not err in finding that there was still no new collective bargaining agreement because the parties had not reached a meeting of the minds. A CBA refers to the negotiated contract between a legitimate labor organization and the employer concerning wages, hours of work, and all other terms and conditions of employment in a bargaining unit, including mandatory provisions for grievances and arbitration machineries. As in all other contracts, there must be clear indications that the parties reached a meeting of the minds. In this case, no CBA could be concluded because of what the Union perceived as illegal deductions from the 70% employees' share in the tuition fee increase from which the salary increases shall be charged, and because the manner of computing the net incremental proceeds was yet to be agreed upon by the parties. Petitioner insisted that a new CBA was concluded through the conciliation proceeding before the NCMB on all issues specified in the notice of strike. Although it is true that the University and the Union may have reached an agreement on the issues raised during the collective bargaining negotiations, still no agreement was concluded by them because, among other reasons, the DOLE Secretary, who assumed jurisdiction on January 23, 1995, was only set to resolve the distribution of the salary increase of the covered employees. The Court of Appeals found that "there are many items in the draft-CBA that were not even mentioned in the minutes of the July 20, 1994 conference." Considering that the parties failed to reach an agreement regarding certain items of the CBA, they still have the duty to negotiate a new collective bargaining agreement in good faith, pursuant to the applicable provisions of the Labor Code.

• Meeting of the Minds in Collective Bargaining — A collective bargaining agreement is the negotiated contract between a legitimate labor organization and the employer concerning wages, hours of work, and all other terms and conditions of employment in a bargaining unit, including mandatory provisions for grievances and arbitration machineries. As in all other contracts, there must be clear indications that the parties reached a meeting of the minds. In this case, no CBA could be concluded because of what the Union perceived as illegal deductions from the 70% employees' share in the tuition fee increase from which the salary increases shall be charged, and because the manner of computing the net incremental proceeds was yet to be agreed upon by the parties. The presence of many items in the draft CBA that were not even mentioned in the minutes of the July 20, 1994 conference confirmed that no meeting of the minds had been reached.

• Conclusiveness of the Court of Appeals' Findings of Fact in Certiorari Appeals — In an appeal via certiorari, the Supreme Court may not review the findings of fact of the Court of Appeals. When supported by substantial evidence, the findings of fact of the Court of Appeals are conclusive and binding on the parties and are not reviewable by the Supreme Court, unless the case falls under any of the exceptions to the rule. Petitioner failed to prove that the case falls within the exceptions. It is not the function of the Court to review, examine, and evaluate or weigh the probative value of the evidence presented; a question of fact would arise in such event, and questions of fact cannot be raised in an appeal via certiorari before the Supreme Court and are not proper for its consideration.

• Duty to Bargain in Good Faith — Where the parties fail to reach an agreement regarding certain items of the CBA, they still have the duty to negotiate a new collective bargaining agreement in good faith, pursuant to the applicable provisions of the Labor Code. The Court enjoined the parties to comply with the directive of the Secretary of Labor and Employment to negotiate a collective bargaining agreement in good faith.

• Assumption of Jurisdiction by the Secretary of Labor — Under Article 263(g) of the Labor Code, the Secretary of Labor may assume jurisdiction over an entire labor dispute. In this case, the Secretary assumed jurisdiction on January 23, 1995 and was set to resolve the distribution of the salary increase of the covered employees, which was one of the reasons why no agreement was concluded by the parties on all the items of the CBA.

• "A collective bargaining agreement (CBA) refers to the negotiated contract between a legitimate labor organization and the employer concerning wages, hours of work and all other terms and conditions of employment in a bargaining unit, including mandatory provisions for grievances and arbitration machineries." — This passage supplies the canonical definition of a collective bargaining agreement, establishing the subject matter and mandatory contents of the negotiated contract between employer and labor organization.

• "As in all other contracts, there must be clear indications that the parties reached a meeting of the minds." — This is the ratio decidendi of the case, applying the contractual requirement of mutual assent to CBA negotiations and grounding the conclusion that no CBA had been concluded between the University and the Union.

• "In this case, no CBA could be concluded because of what the union perceived as illegal deductions from the 70% employees' share in the tuition fee increase from which the salary increases shall be charged. Also, the manner of computing the net incremental proceeds was yet to be agreed upon by the parties." — This passage applies the meeting-of-the-minds rule to the facts, identifying the specific unresolved items — the alleged illegal deductions and the computation of net incremental proceeds — that prevented the conclusion of a CBA.

• "Considering the parties failed to reach an agreement regarding certain items of the CBA, they still have the duty to negotiate a new collective bargaining agreement in good faith, pursuant to the applicable provisions of the Labor Code." — This passage states the operative consequence of the failure to reach a meeting of the minds: the parties remain duty-bound to negotiate a new CBA in good faith, which is the directive the Court enjoined them to comply with.

• Manila Fashions vs. National Labor Relations Commission, 332 Phil. 121 [1996] — Cited for the definition of a collective bargaining agreement as the negotiated contract between a legitimate labor organization and the employer concerning wages, hours of work, and all other terms and conditions of employment in a bargaining unit, including mandatory provisions for grievances and arbitration machineries.
• Atillo vs. Court of Appeals, 334 Phil. 546, 555 [1997] — Cited for the rule that the findings of fact of the Court of Appeals are conclusive and binding on the parties and are not reviewable by the Supreme Court.
• Cebu Shipyard and Engineering Works, Inc. vs. William Lines, Inc., 366 Phil. 439, 452 [1999] — Cited for the exceptions to the rule on the conclusiveness of the findings of fact of the Court of Appeals.
• Trade Unions of the Philippines vs. Laguesma, 236 SCRA 586, 591 [1994] — Cited for the rule that it is not the function of the Supreme Court to review, examine, and evaluate or weigh the probative value of the evidence presented.
• Hi-Precision Steel Center, Inc. vs. Lim Kim Steel Builders, Inc., 228 SCRA 397 [1993] — Cited for the rule that questions of fact cannot be raised in an appeal via certiorari before the Supreme Court and are not proper for its consideration.

• Article 263(g), Labor Code — Under this provision, the Secretary of Labor assumed jurisdiction over the entire labor dispute at the University of the Immaculate Concepcion College on January 23, 1995, directing all workers to return to work within twenty-four hours upon receipt of the order and management to accept them back under the same terms and conditions prior to the strike, and directing the parties to cease and desist from committing any or all acts that might exacerbate the situation.
• Article 263(c), Labor Code — Cited by the Secretary of Labor in ruling that the issues raised in the notice of strike — bargaining deadlock and unfair labor practice — are strikeable issues specifically provided under this provision, thereby supporting the finding that the strike declared by the Union on January 20, 1995 was valid.
• Republic Act No. 6728 — Referenced in the Union's second Notice of Strike, which alleged bargaining deadlock on the allocation of 5% (CBA) and the distribution/computation of the 70% incremental proceeds under RA 6728; the manner of computing the net incremental proceeds remained unsettled between the parties.
• DECS Order No. 15, Series of 1992 — The Secretary of Labor directed that the salary increases be distributed in accordance with this issuance to avoid differences of opinion in the distribution of the salary increases to the covered employees.

Davide, Jr., C.J., Puno, Kapunan, and Ynares-Santiago, JJ.