Labor Law: Book V; Title II; Chapter III Appeal (Arts. 229-231)

  Book V

Labor Relations

Title II

National Labor Relations Commission

Chapter III

Appeal

Arts. 229-231

Q: On what grounds may I appeal a labor arbiter's decision?
Q: If I still lose in the NLRC itself, can I bring the case to the Supreme Court? or to the Secretary of Labor?


Art. 229. Appeal. 
Decisions, awards, or orders of the Labor Arbiter are final and executory unless appealed to the Commission by any or both parties within ten (10) calendar days from receipt of such decisions, awards, or orders. Such appeal may be entertained only on any of the following grounds:
  1. If there is prima facie evidence of abuse of discretion on the part of the Labor Arbiter;
  2. If the decision, order or award was secured through fraud or coercion, including graft and corruption;
  3. If made purely on questions of law; and
  4. If serious errors in the findings of facts are raised which would cause grave or irreparable damage or injury to the appellant.

In case of a judgment involving a monetary award, an appeal by the employer may be perfected only upon the posting of a cash or surety bond issued by a reputable bonding company duly accredited by the Commission in the amount equivalent to the monetary award in the judgment appealed from.

In any event, the decision of the Labor Arbiter reinstating a dismissed or separated employee, insofar as the reinstatement aspect is concerned, shall immediately be executory, even pending appeal. The employee shall either be admitted back to work under the same terms and conditions prevailing prior to his dismissal or separation or, at the option of the employer, merely reinstated in the payroll. The posting of a bond by the employer shall not stay the execution for reinstatement provided herein.

To discourage frivolous or dilatory appeals, the Commission or the Labor Arbiter shall impose reasonable penalty, including fines or censures, upon the erring parties.

In all cases, the appellant shall furnish a copy of the memorandum of appeal to the other party who shall file an answer not later than ten (10) calendar days from receipt thereof.

The Commission shall decide all cases within twenty (20) calendar days from receipt of the answer of the appellee. The decision of the Commission shall be final and executory after ten (10) calendar days from receipt thereof by the parties.

Any law enforcement agency may be deputized by the Secretary of Labor and Employment or the Commission in the enforcement of decisions, awards or orders. 



Notes:

Art. 229. Appeal
  • Finality:
    • Decisions, awards, or orders of the Labor Arbiter are final and executory unless appealed to the Commission within ten (10) calendar days.
  • Grounds:
    1. Prima facie evidence of LA abuse of discretion.
    2. Decision secured through fraud, coercion, graft, or corruption.
    3. Purely on questions of law.
    4. Serious errors in findings causing grave or irreparable damage or injury.
  • Monetary Award:
    • Employer's appeal for a monetary award requires posting a cash or surety bond equivalent to the judgment's monetary amount.
  • Reinstatement:
    • Labor Arbiter's decision on reinstating a dismissed employee is immediately executory, even pending appeal.
    • Reinstatement involves returning to work or being reinstated in the payroll at the employer's option.
  • Penalties for Frivolous or Dilatory Appeals:
    • Reasonable penalties, including fines or censures.
  • Appeal Procedure:
    • Appellant shall furnish a copy of the memorandum to the other party.
    • Respondent must file an answer within ten (10) calendar days from receipt.
  • Commission Decision:
    • The Commission must decide all cases within twenty (20) calendar days from receipt of the answer.
    • Commission decision becomes final and executory ten (10) calendar days after receipt.
  • Enforcement Authority:
    • Any law enforcement agency may be deputized for enforcing decisions, awards, or orders by the Secretary of Labor and Employment or the Commission.
Appeal
  • "Appeal" means the elevation by an aggrieved party of any decision, order or award of a lower body to a higher body, by means of a pleading which includes the assignment or enumeration of errors, the supporting arguments and the reliefs or assistance prayed for.
Requisites for Perfection of Appeal
  • If an appeal is not "perfected" it means that it failed to observe some technical/procedural requirements, for which reason it may be dismissed or rejected.
  • The following are the requisites for perfection of appeal from the Labor Arbiter to the NLRC (Division):
  • The appeal should be: 
    1. Filed within the reglementary period, or the time limit specified by law;
    2. Verified by appellant himself in accordance with Section 4, Rule 7 of the Rules of Court;
    3. In the form of a memorandum of appeal in three legibly typewritten copies which shall state:
      • the grounds relied upon,
      • the supporting arguments,
      • the relief prayed for and
      • the date the appellant received the appealed decision, resolution or order.
    • The appeal memorandum should be accompanied by a:
      • certificate of non-forum shopping
      • proof of service on the other party
      • proof of payment of the appeal fee
      • cash or surety bond
  • A mere notice of appeal without complying with the other requisites shall not stop the running of the ten-day period for perfecting an appeal.
  • Within 10 days after receiving the appeal memorandum, the appellee may file his answer.
Periods
  • The ten-day period provided in Article 229 refers to 10 calendar days, not working days. This means that Saturday Sundays and legal holidays are included in the counting of the 10-day period. (SM Agri and General Machineries, January 9 1989)
  • If the tenth day to perfect an appeal from the decision of the Labor Arbiter to the NLRC falls on a Saturday, Sunday or holiday, the appeal shall be made on the next working day. (Aquino, September 3, 1993 and NLRC Rules of Procedure)
  • The payment of the appeal fee is not a mere technicality, but is an essential requirement in the perfection of an appeal. However, where the fee has been paid belatedly, the broader interest of justice and the desired objective in deciding the case on the merits demand that the appeal will be given due course. (CW Tan Manufacturing, February 3 , 1989)
  • Rules of technicality must yield to the broader interest of substantial justice. The dismissal of an appeal on purely technical grounds is frowned upon. (Modern Fishing, May 6, 1988)
  • Vivencio Abo worked for SM Industries, later SM Agricultural and General Machineries, from 1976 until termination in 1982. Abo filed a complaint for unlawful dismissal and damages against the petitioner. Petitioner cited Abo's willful disobedience in reporting responsibilities as justification for termination.
  • Labor Arbiter: Ruled in favor of Abo, ordering reinstatement.
  • NLRC: Dismissed the petitioner's appeal, citing late filing within the 10-day period.
  • In the Motion for Reconsideration, the petitioner argued the appeal was filed within the 10-day period, explaining the impossibility of filing on Good Friday. Despite acknowledging the appeal was filed on the 13th day, the petitioner argued against strict application of the 10-day period. The NLRC denied the motion for reconsideration.
  • WoN  the NLRC committed grave abuse of discretion in dismissing petitioner’s appeal on the ground of tardiness or late filing. YES
  • The 10-day period provided in Art. 223 of the Labor Code refers to 10 calendar days and not 10 working days. This means that Saturdays, Sundays and Legal Holidays are not to be excluded, but included, in counting the 10-day period. This is in line with the objective of the law for speedy disposition of labor cases with the end in view of protecting the interests of the working man. However, this is not a case of a Legal Holiday falling within the period, between the day when the decision appealed from was received and the last day to appeal or the 10th day. Instead, we have here a case where the Legal Holiday is coincidentally the 10th or the last day to appeal.
  • Therefore, while upholding the interpretation made in the Vir-Jen Shipping case that the 10-day period fixed by Art. 223 of the Labor Code contemplates calendar days and not working days, the court recognizes an exception to this general rule, i.e., where the 10th day is a Sunday or a Legal Holiday, in which event, the appeal can be filed on the next business day. Consequently, in such a case, the supposedly last day to appeal will not be deemed the last day because it happens to be a Sunday or Legal Holiday. Instead, the act can be done on the next business day following that Sunday or Legal Holiday. 
  • Roman Aquino filed a complaint for illegal dismissal against the Roblett Industrial Construction, Inc. before the Labor Arbiter.
  • Labor Arbiter: Declared the dismissal illegal, ordering reinstatement and payment of backwages to the petitioner.
  • The private respondent's counsel received the decision on June 13, 1990, and the last day to appeal was on June 23, 1990, a Saturday. The private respondent filed the appeal on June 25, 1990, two days beyond the reglementary period.
  • Petitioner filed a motion to dismiss the appeal, citing the period had already lapsed and non-posting of the required bond.
  • NLRC: Initially dismissed the appeal but later reversed it because the NLRC has no office on Saturdays.
  • WoN a memorandum on appeal due on a Saturday can be filed timely on the following Monday. YES
  • Article 223 of the Labor Code, however, is silent with regard to cases when the ten-day reglementary period within which to perfect an appeal falls on a Saturday, which is not a holiday.
  • Pacaña v. NLRC held that when the reglementary period of ten calendar days prescribed by Article 223 of the Labor Code falls on a Saturday and the offices of the NLRC are closed, the appeal is seasonably filed on the following Monday, being the first day the appeal can be filed after the lapse of the reglementary period. On January 14, 1992, the NLRC amended its Rules of Procedure to conform with the decision of this Court in Pacaña. As amended, Section 1, Rule VI of the Rules of Procedure of the NLRC now specifies that if the tenth day to perfect an appeal from the decision of the Labor Arbiter to the NLRC falls on a Saturday, the appeal shall be made on the next working day. The law does not require the performance of an impossible act (impossibilum nulla obligatio est).
  • However, while the appeal to the NLRC was filed on time, it must be dismissed for failure of the appellant to file the cash or surety bond required under Article 223 of the Labor Code. The provisions of Article 223 of the Labor Code, as amended by R.A. No. 6715, requiring the posting of cash or surety bond in appeals from decisions of Labor Arbiter granting monetary awards, are self-executing and do not need any administrative rules to implement them.
  • The Associated Labor Union (ALU) and Angelino Brimon filed a complaint for illegal dismissal against the petitioners C.W. Tan Manufacturing, Federico Javier and Jaime So.
  • The petitioners issued a memorandum citing undesirable behavior and violation of company rules as grounds for termination. Brimon was allegedly dismissed due to seeking leave of absence without proper approval and lying about it.
  • Labor Arbiter: Dismissed the complaint citing valid cause and due process.
  • NLRC: Initially dismissed the appeal for being filed out of time as there was no proof of service of the appeal to the adverse party. But later reconsidered its decision, finding Brimon's dismissal arbitrary without a formal investigation, setting aside the labor arbiter's decision.
  • The petitioner challenges the NLRC decision for failing to furnish a copy of the appeal memorandum and pay the docketing fee within the reglementary appeal period.
  • WoN the questioned decision of the labor arbiter had become final and executory for failure of private respondents to perfect their appeal on time. YES
  • The technical rules of evidence are not binding in proceedings before the NLRC or labor arbiters and that all reasonable means should be used to ascertain the facts of the case without regard to the technicality ties of law or procedure.
  • Although it is obvious that private respondent failed to pay the required docketing fee for an unreasonable length of time, nevertheless this Court finds that under the circumstances of the case and considering the merit of the appeal, the greater interest of justice will be served by giving due course to the appeal despite the much delayed payment of the docketing fee. Indeed, private respondent Brimon, being a dismissed employee, can very well be considered as a pauper litigant whose failure to pay the nominal docketing fee of P25.00 within the reglementary period should be treated with understanding and compassion.
  • The Court finds that there is a cogent basis in the finding of public respondent NLRC that private respondent Brimon was arbitrarily dismissed without benefit of a formal investigation.
  • Modern Fishing Gear Workers Union and Modern Fishing Gear Labor Union agreed to a consent election upon approval of their registration applications.
  • Modern Fishing Gear Workers Union filed a petition for certification election, claiming a consensus for a consent election and no existing collective bargaining agreement. Modern Fishing Gear Labor Union Union filed a collective agreement for certification on the same day, which was later certified.
  • Modern Fishing Gear Workers Union filed for decertification of the alleged CBA.
  • BLR: Ordered decertification on October 29, 1979.
  • Med-Arbiter: Dismissed the petition for certification election based on the contract-bar rule, citing certifiable CBA as a bar to a petition for certification election.
  • Modern Fishing Gear Workers Union appeal: Arguing certification of a CBA is subject to the proviso of no pending petition for certification election.
  • Director of the Bureau of Labor Relations: Ordered a certification election and withdrawal of the BLR CBA between the company and the petitioner union.
  • WoN the non-compliance with the appeal procedure from a med-arbiter's decision to the Director of the Bureau of Labor Relations is a mere technicality error. YES
  • The fact that the respondent union filed its appeal directly with the BLR instead of its regional office is of little significance when we consider that the petitioner was given every opportunity to oppose the appeal of the respondent union. Furthermore, there is nothing wrong in the BLR's taking cognizance of the appeal although the same was not coursed through the regional office since it is the BLR which will actually decide the appeal.
  • As the decision of the respondent BLR aptly states, the petitioner union failed to show that it was prejudiced by the delay in the service of the copy of the appeal. On the contrary, the records will show that the petitioner was not only invited for conference by the BLR regarding the appeal of the respondent union but it was also given fifteen (15) working days within which to file its memorandum and other relevant pleadings. Thus, in the absence of a showing that the petitioner was denied due process of law under the circumstances, we cannot adhere to the automatic application of the implementing rules so as to defeat a meritorious appeal.
  • More compelling is the policy that rules of technicality must yield to the broader interests of substantial justice. The dismissal of an appeal on purely technical grounds is frowned upon by to Court, especially considering in the case at bar, the merit of respondent employees' clarification of the delay for which they should rot be faulted. Furthermore, we wish to emphasize that the holding of certification elections is one of the more important rights accorded to workers and employees. Thus, its exercise should not be defeated by the blind observance of procedural technicalities such as that being urged by herein petitioner.

Perfection of Appeal Requires Posting of Bond on Time.
  • As stated in this article, the appeal from the Labor Arbiter's decision is not perfected if cash or surety bond is not posted within the 10-day appeal period. 
  • This is clear also in Sections 4 and 6, Rule VI of the 2011 Rules of Procedure of the NLRC, and the rule is reiterated by the Supreme Court in Borja Estate vs. Ballad, G.R No. 152550, June 8, 2005. The Court said:
    • As there was no appeal bond filed together with the Appeal Memorandum within the ten (10)-day period provided by law for the perfection of appeal, it follows that no appeal from the decision of the Labor Arbiter had been perfected. Accordingly, the Decision of the Labor Arbiter became final and executory upon the expiration of the reglementary period... It bears stressing that the bond is sine qua non to the perfection of appeal from the labor arbiter’s monetary award.
  • A motion to reduce the bond may be filed on meritorious grounds, but meantime a bond in a reasonable amount in relation to the monetary award should be posted with the appeal, otherwise, the motion does not stop the running of the period to perfect an appeal. (Sec. 6, Rule VI, the 2011 Rules of Procedure of the NLRC, Stolt-Nielsen, December 13, 2005)
  • In 1999, Spouses Ballad filed a complaint against Borjas for illegal dismissal and various labor claims with the NLRC.
  • The Ballad spouses worked as overseers for the Borja Estate since 1972, appointed in writing by Paula Borja, overseeing agricultural lands and apartments. The Ballads were allegedly not paid various benefits for 27 years.
  • The Borjas defended that the Ballads were not employees but allowed to reside as a gesture of gratitude. 
  • Labor Arbiter: Ruled the Ballads were illegally dismissed.
  • The Borjas to appeal to the NLRC with a Motion for Reduction of Bond.
  • NLRC: Dismissed the motion and the appeal in April 2000 for failure to post a bond within the prescribed period. The motion for reconsideration was also denied.
  • CA: Affirmed the NLRC's decision, emphasizing the mandatory nature of posting a bond for appeal. The Court of Appeals noted the Borjas' late posting of the bond and ruled the Labor Arbiter's decision as final and executory. 
  • WoN the Court of Appeals erred in agreeing with the NLRC that the posting of a cash or surety bond during the period of time to file an appeal is mandatory and the failure to do so would have the effect of rendering the appealed decision final and executory. NO
  • The intention of the lawmakers to make the bond an indispensable requisite for the perfection of an appeal by the employer is underscored by the provision that an appeal may be perfected "only upon the posting of a cash or surety bond." The word "only" makes it perfectly clear that the lawmakers intended the posting of a cash or surety bond by the employer to be the exclusive means by which an employer’s appeal may be considered completed. The word "may", on the other hand refers to the perfection of an appeal as optional on the part of the defeated party, but not to the posting of an appeal bond, if he desires to appeal.
  • The requirement that the employer post a cash or surety bond to perfect its/his appeal is apparently intended to assure the workers that if they prevail in the case, they will receive the money judgment in their favor upon the dismissal of the employer’s appeal. It was intended to discourage employers from using an appeal to delay, or even evade, their obligation to satisfy their employees’ just and lawful claims.
  • Ramon Alpino, the private respondent, was employed by Stolt Nielsen Marine Services, Inc. from 1978 to 1984. He was repatriated to the Philippines after being diagnosed with Cardiac Enlargement, Pulmonary Hypertension and Acute Psychotic Reaction and declared unfit for sea duty.
  • In 1985, he filed a complaint with POEA, which was amicably settled through a "Receipt and Release" executed by him and his sister.
  • In 1989, Alpino filed a case with the RTC for the annulment of the Receipt and Release, alleging mental incapacity to execute the SPA. In 1993, the RTC dismissed the case and the Court of Appeals affirmed the decision.
  • In 1994, Alpino filed another case with the POEA  for sickness and disability benefits, which was transferred to the NLRC due to Republic Act 8042.
  • Labor Arbiter: Declared the SPA and Receipt and Release as invalid and awarded Alpino sickness and disability benefits.
  • Stolt Nielsen Marine Services, Inc. filed an appeal with the NLRC along with an Urgent Motion to Reduce or be Exempted from Filing an Appeal Bond.
  • NLRC: Affirmed the Labor Arbiter's decision and denied the motion to reduce the appeal bond. 
  • Court of Appeals: Affirmed the NLRC's decision.
  • WoN the Court of Appeals erred affirming the NLRC decision. NO
  • The implementing rules of respondent NLRC are unequivocal in saying that "the filing of the motion to reduce bond shall not stop the running of the period to perfect appeal." Thus, petitioner should have seasonably filed the appeal bond within the ten-day reglementary period following its receipt of the decision of Labor Arbiter in order to forestall the finality of said decision.
  • It is true that the requirement of posting a bond on appeals involving monetary awards has been given a liberal interpretation in certain cases. However, relaxation of this rule can only be done where there was substantial compliance of the NLRC Rules of Procedure or where the party involved, at the very least, demonstrated willingness to abide by the rules by posting a partial bond. Petitioner did not post a full or partial appeal bond within the prescribed period. Petitioner could have even paid a moderate and reasonable sum as premium for such bond as the law does not require outright payment but merely the posting of a bond to ensure that the award will be eventually paid should the appeal be dismissed, but still, petitioner failed to do so. Hence, we find no cogent reason to apply the same liberal interpretation in this case.

"McBurnie Guidelines"
  • "Bond in a reasonable amount" is said to be a provisional cash or surety bond equivalent to ten percent (10%) of the monetary award subject o the appeal, exclusive o damages and attorney's fees. The NLRC shall still resolve the motion to reduce the bond and determine the final amount of bond that shall be posted by the appellant. (McBurnie, October 17, 2013)
  • Andrew James McBurnie, an Australian national, filed a complaint for illegal dismissal and other claims against Eulalio Ganzon, EGI-Managers, Inc. and E. Ganzon, Inc.
  • McBurnie claimed he signed a five-year employment agreement as Executive Vice-President with EGI, overseeing hotels and resorts in the Philippines, but was illegally dismissed after an accident.
  • Respondents argued the agreement was for joint investment, not employment, and McBurnie lacked alien work permit.
  • Labor Arbiter: Declared McBurnie illegally dismissed and awarded significant amounts. 
    • Respondents appealed, filing a motion to reduce the bond.
  • NLRC: Denied the motion to reduce bond, requiring additional bond posting. The respondents' appeal was dismissed for failure to post the bond.
  • CA: Granted a writ of preliminary injunction, directing the NLRC to give due course to the appeal, conditioned on a ₱10,000,000.00 bond.
    • The CA later ruled in 2008 that the NLRC committed grave abuse of discretion in denying the motion to reduce bond and dismissing the appeal for failure to post an additional bond.
  • NLRC: Acting on the CA's order, reversed the LA's decision, stating McBurnie was never an employee and lacked a work permit.
  • Supreme Court: In 2009, reversed the CA's decision, reinstating the NLRC's dismissal of the appeal for failure to post a sufficient bond.
    • McBurnie's motion for reconsideration was denied, and the decision became final in 2012. Entry of judgment was made in due course.
  • In 2012, respondents filed a motion for reconsideration, alleging grave abuse of discretion, a substantial bond, and irregularities in the Supreme Court's 2009 decision.
  • The Supreme Court accepted the case en banc, issuing a TRO against implementing the LA's decision.
  • WoN the McBurnie was illegally dismissed. NO
  • McBurnie was not an employee of the respondents; thus, they could not have dismissed him from employment. The employment agreement could not have given rise to an employer-employee relationship by reason of legal impossibility. The two conditions that form part of their agreement, namely, the successful completion of the project financing for the hotel project in Baguio City and McBurnie’s acquisition of an Alien Employment Permit, remained unsatisfied. The NLRC concluded that McBurnie was instead a potential investor in a project that included Ganzon, but the said project failed to pursue due to lack of funds. Absent an employment permit, any employment relationship that McBurnie contemplated with the respondents was void for being contrary to law. A void or inexistent contract, in turn, has no force and effect from the beginning as if it had never been entered into. 
  • Furthermore, on the matter of the filing and acceptance of motions to reduce appeal bond, as provided in Section 6, Rule VI of the 2011 NLRC Rules of Procedure, the Court hereby RESOLVES that henceforth, the following guidelines shall be observed:
    1. The filing o a motion to reduce appeal bond shall be entertained by the NLRC subject to the following conditions: 
      1. there is meritorious ground; and 
      2. a bond in a reasonable amount is posted;
    2. For purposes o compliance with condition no. (2), a motion shall be accompanied by the posting o a provisional cash or surety bond equivalent to ten percent (10%) of the monetary award subject o the appeal, exclusive o damages and attorney's fees;
    3. Compliance with the foregoing conditions shall suffice to suspend the running o the 10-day reglementary period to perfect an appeal from the labor arbiter's decision to the NLRC;
    4. The NLRC retains its authority and duty to resolve the motion to reduce bond and determine the final amount o bond that shall be posted by the appellant, still in accordance with the standards o meritorious grounds and reasonable amount; and
    5. In the event that the NLRC denies the motion to reduce bond, or requires a bond that exceeds the amount o the provisional bond, the appellant shall be given a fresh period o ten (10) days from notice o the NLRC order within which to perfect the appeal by posting the required appeal bond.

Effect of Appeal from Arbiter to NLRC
  • Once the appeal is filed, the Labor Arbiter Ioses jurisdiction over the case – it's out of his hands. All motions/pleadings shall thereafter be addressed to and filed with the Commission. (Sec. 9, Rule VI, NLRC Rules of 2011)
  • The perfection of appeal to the NLRC shall stay (or suspend) the execution of the decision of a Labor Arbiter. 
    • However, if the decision includes an order of reinstatement of a dismissed employee, the Labor Arbiter shall immediately issue a partial writ of execution even pending appeal. 
    • The writ (order or instruction) shall direct the employer to immediately reinstate the dismissed employee either actually or only in the payroll and to pay the corresponding salaries as a consequence of the reinstatement within 10 days from receipt of the decision the employer should submit to the arbiter a report of compliance; otherwise, he may be cited for contempt.
  • Actual reinstatement – the employee goes back to work;
  • Payroll reinstatement – the employee does not work but still gets paid regularly.
Issues on Appeal; Remedies
  • The Commission shall, in cases of perfected appeals, limit itself to reviewing those issues which are raised on appeal. 
  • Those which are not raised shall be final and executory, i.e., ready for implementation. 
  • The issues raised on appeal, however, shall be open for review, that is, the NLRC is legally authorized to decide or take action on the questions brought up on appeal. (Roche Philippines, October 5, 1989)
  • Reynaldo J. Villareal, a medical representative, worked for the Roche Philippines in the Dumaguete/Bohol area.
  • Jerry Losbanes, a supervisor, accused Villareal of "kiting" based on a report by Johnny de la Cruz, alleging Villareal was in Cebu City when he should be in Dumaguete as per his report.
  • Villareal denied the charges, submitted evidence, and requested an investigation but was suspended and later dismissed without a hearing.
  • The company requested Villareal to sign a letter-quitclaim for a certificate of employment. Villareal rejected the offer and filed a complaint with the NLRC, including a claim for 50% of savings from his cost-saving proposal during the first 12 months of the implementation.
  • Labor Arbiter: Found the company guilty of illegal dismissal and ordered payment for unpaid salaries, backwages, 13th-month pay, benefits, allowances, retirement benefits, and damages amounting to P155,000.00.
  • NLRC: Affirmed with modifications, ordering reinstatement, back wages, retirement benefits, 50% of savings or P500,000.00, moral and exemplary damages, and attorney's fees.
  • WoN the NLRC acted without or in excess of jurisdiction and/or committed grave abuse of discretion amounting to lack of jurisdiction in granting Villareal additional reliefs, even if the latter did not appeal from the decision of the Arbiter. NO
  • Petitioners suggest that the respondent Commission abused its discretion in awarding reliefs in excess of those stated in the decision of the labor arbiter despite the absence of an appeal by Villareal. To stress this point, they cited Section 5(c) of the Rules of Procedure of the National Labor Relations Commission which provides that the Commission shall, in cases of perfected appeals, limit itself to reviewing those issues which were raised on appeal. Consequently, those which were not raised on appeal shall be final and executory.
  • There is no merit in this contention. The records show that the petitioners elevated the issues regarding the correctness of the award of damages, reinstatement with backpay, retirement benefits and the cost-saving bonus to the respondent Commission in their appeal. This opened the said issues for review and any action taken thereon by the Commission was well within the parameters of its jurisdiction.
Extraordinary Remedies
  • The topics below we'll continue traveling down the appeal procedure from the Labor arbiter to the commission. But at this point we need to take a brief look at the significant new rule introduced in 2011 NLRC Rules of Procedure. It is the Rule XII entitled "Extraordinary Remedies" following the Supreme Court ruling in Triad Security v. Ortega, G.R. No. 160871.
  • New Rule XII allows a party to file with the commission a petition, assailing not just the order of the labor arbiter but his alleged abuse of discretion.
  • In the petition, the labor arbiter, in a nominal capacity will be a co-respondent with the other party litigant. 
  • The petition which should be filed within 10 calendar days from receipt of the assailed order or resolution may be entertained by the Commission, if it is based on any of the following grounds:
  1. If there is prima facie evidence of abuse of discretion on the part of the Labor Arbiter.
  2. If serious errors in the findings of facts are raised which, if not corrected, would cause grave or irreparable damage or injury to the petitioner.
  3. If a party by fraud, accident, mistake or excusable negligence has been prevented from taking an appeal;
  4. If made purely on questions of law; or
  5. If the order or resolution will cause injustice if not rectified.
  • The petition may seek an order to suspend or stop the execution of the labor arbiter's order or resolution. 
  • The Commission may require the petitioner to put up a bond.
Prima facie – minimum evidence acceptable to support a charge

Conciliation and Mediation
  • Even at the appeal stage of a labor arbiter's decision, amicable settlement is a preferred mode. 
  • The 2011 Rules of Procedure of the NLRC (Rule VII, Sec. II) states: 
    • In the exercise of its exclusive original and appellate jurisdiction, the Commission may exert all efforts towards the amicable settlement of a labor dispute. 
    • The settlement of cases on appeal, to be valid and binding between the parties, shall be made before the Commissioner or his authorized representative.
NLRC Decision
  • The decision of the Commission shall be final and executory after 10 calendar days from receipt by the parties. 
  • The losing party, however, is not without recourse. 
    • Under the 2011 Rules of Procedure of the NLRC, a party is allowed to file a motion for reconsideration of any order, resolution or decision of the Commission based on palpable or patent errors, provided that the motion is under oath and filed within 10 calendar days from receipt of the order, resolution or decision. (Purefoods, March 21, 1989)
  • A party who failed to appeal on time from the decision of Labor Arbiter may still file a motion for reconsideration of the NLRC decision. (Sadol, June 13, 1990)
  • A party may file only for one motion for reconsideration. (Sec. 15, Rule VII of e 2011 NLRC Rules of Procedure) 
  • The NLRC Rules do not allow a second motion of reconsideration.
    • If the NLRC entertains such a motion, it violates its own rules and therefore commits grave abuse of discretion. (Jardin, February 23, 2000)
  • Private respondents Remigio Clavio, Andres Catubay, Virgilio Umali, Orlando Rey, and Jorge Del Rosario were employees of Pure Foods Corporation.
  • Private respondents were indefinitely suspended for alleged pilferage without prior investigation. They then filed a complaint for illegal dismissal and unpaid wages.
  • Director Severo M. Pucan: Ordered Pure Foods Corporation to reinstate private respondents with backwages.
    • Petitioner appealed to the Ministry of Labor and Employment, leading to an order for compulsory arbitration by the NLRC-NCR-Arbitration Branch.
  • Labor Arbiter: Held the dismissal of the other complainants to be justified except for Remigio Clavio,
  • NLRC: Held in favor of all the private respondents, ordering their reinstatement.
    • The decision then became final, and private respondents moved for a writ of execution.
  • NLRC denied petitioner's motion for reconsideration. Petitioner then resorted to a special civil action for certiorari.
  • WoN the NLRC committed a grave abuse of discretion in totally reversing the findings of facts of the labor arbiter. NO
  • The New Rules of the NLRC permit parties to file a motion for reconsideration within ten days of receiving an order, resolution, or decision, based on palpable or patent errors.Parties can also avail themselves of the special civil action for certiorari if the tribunal, board, or officer exercising judicial functions acted without jurisdiction, in excess of jurisdiction, or with grave abuse of discretion.
    • Remedy:
      1. Motion for Reconsideration within 10 days; or
      2. Certiorari
  • In the case discussed, the petitioner filed a belated motion for reconsideration, which was denied by the public respondent. The petitioner then resorted to a special civil action for certiorari, claiming a grave abuse of discretion by the public respondent in reversing the labor arbiter's findings.
  • The court emphasized that certiorari is only appropriate when there is no other plain, speedy, and adequate remedy against the acts of the respondent. Filing a motion for reconsideration was deemed the appropriate and more speedy remedy, which the petitioner pursued beyond the reglementary period. The court rejected the petitioner's argument that there was no plain, speedy, and adequate remedy available, considering the delay in filing the motion for reconsideration.
  • Geronimo Sadol was recruited as a laborer by private respondents, who are the owners of a private recruitment agency Vega & Co.
  • He was assigned at Pilipinas Kao, Inc. (PKI). and was later allegedly summarily dismissed.
  • He filed a complaint for reinstatement and backwages with DOLE.
  • Labor Arbiter: Ordered payment of separation pay to the petitioner. 
    • Both parties appealed to the NLRC but respondents appeal was filed out of time.
  • NLRC: Modified the decision, ordering PKI to reinstate the petitioner with full backwages or, if reinstatement is impossible, payment of full backwages and separation pay.
    • PKI's appeal was dismissed as filed out of time. 
    • PKI filed a motion for reconsideration and a similar motion was filed by another Samahang Kabuhayan ng Barangay Luz Banzon.
  • NLRC: Set aside its decision and dismissed the case for lack of merit. 
    • The petitioner questioned this decision through a petition for certiorari.
  • WoN the NLRC committed a grave abuse of discretion in entertaining the motion for reconsideration filed by respondent and reversing its own decision. NO
  • Having lost the right to appeal can respondent PKI file a motion for reconsideration of said decision? The Court resolves the question in the affirmative. The rules of technicality must yield to the broader interest of justice. It is only by giving due course to the motion for reconsideration that was timely filed that the NLRC may be able, to equitably evaluate the conflicting versions of facts presented by the parties.
  • The Court upheld the findings of NLRC that SKLB was a lawful independent labor contractor and that the petitioner abandoned his job without justification, leading to the dismissal of the case.

  • Petitioners were drivers for Philjama International Inc., operating "Goodman Taxi" under a 24-hour work schedule through the boundary system, earning an average of P400.00 daily.
  • Private respondent regularly deducted P30.00 from petitioners' daily earnings for taxi washing, prompting petitioners to form a labor union.
  • Upon learning of the union plan, private respondent refused to let petitioners drive. Petitioners suspected singling out because they were the leaders and active members of the proposed union. 
  • Petitioners filed a complaint for unfair labor practice, illegal dismissal, and illegal deduction of washing fees.
  • Labor Arbiter: Dismissed the complaint.
  • NLRC: Reversed LA decision, declaring petitioners as employees and ordering reinstatement and backwages.
    • Private respondent filed motions for reconsiderations, the second motion was granted.
  • NLRC: Claimed lack of jurisdiction over the case as petitioners and private respondent have no employer-employee relationship. Thus, the relationship is covered by the Civil Code rather than the Labor Code.
  • WoN the NLRC committed a grave abuse of discretion in entertaining the second motion for reconsideration which is a pleading prohibited under NLRC Rules. YES
  • In this case before us, private respondent exhausted administrative remedy available to it by seeking reconsideration of public respondent's decision dated April 28, 1994, which public respondent denied. With this motion for reconsideration, the labor tribunal had ample opportunity to rectify errors or mistakes it may have committed before resort to courts of justice can be had. Thus, when private respondent filed a second motion for reconsideration, public respondent should have forthwith denied it in accordance with Rule 7, Section 14 of its New Rules of Procedure which allows only one motion for reconsideration from the same party. 
  • The rationale for allowing only one motion for reconsideration from the same party is to assist the parties in obtaining an expeditious and inexpensive settlement of labor cases. For obvious reasons, delays cannot be countenanced in the resolution of labor disputes. Public respondent cannot just disregard its own rules on the pretext of "satisfying the ends of justice", especially when its disposition of a legal controversy ran afoul with a clear and long standing jurisprudence in this jurisdiction as elucidated in the subsequent discussion.
  • Petitioners are undoubtedly employees of private respondent because as taxi drivers they perform activities which are usually necessary or desirable in the usual business or trade of their employer.

Petition for Certiorari with the Court of Appeals
  • If the motion for reconsideration fails and there are merits in pursuing the case, the party may also seasonably avail itself of the special civil action for certiorari under Rule 65 of the Rules of Court.
  • The action is allowed, in general, if the tribunal, board or officer exercising judicial functions has acted without or in excess of its jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction. An extraordinary remedy, a petition for certiorari is available only and restrictively in truly exceptional cases. The sole office of certiorari is the correction of errors of jurisdiction including the commission of grave abuse of discretion amounting to lack or excess of jurisdiction. It does not include correction of the NLRC's evaluation of the evidence or of its factual findings. Such findings are generally accorded not only respect but also finality. (Odango, June 10, 2004)
  • Petitioners are monthly-paid employees of Antique Electric Cooperative (ANTECO), working from Monday to Friday and half of Saturday. 
  • In 1989, Department of Labor and Employment (DOLE) found ANTECO liable for underpayment, directing them to pay wage differentials, which ANTECO failed to pay. 
  • In 1995, 33 monthly-paid employees filed complaints with NLRC, seeking wage differentials, damages, and attorneys fees. 
  • Labor Arbiter: Ruled in favor of petitioners.
  • NLRC: Reversed LA Decision.
  • CA: The petition was insufficient in form and substance since it "does not allege the essential requirements of the extra-ordinary special action of certiorari." 
    • The Court of Appeals faulted petitioners for failing to recite "where and in what specific instance public respondent abused its discretion.
  • WoN the CA is correct in dismissing the claim. YES
  • The sole office of the writ of certiorari is the correction of errors of jurisdiction including the commission of grave abuse of discretion amounting to lack or excess of jurisdiction. It does not include correction of the NLRC’s evaluation of the evidence or of its factual findings. Such findings are generally accorded not only respect but also finality. A party assailing such findings bears the burden of showing that the tribunal acted capriciously and whimsically or in total disregard of evidence material to the controversy, in order that the extraordinary writ of certiorari will lie.
  • We agree with the Court of Appeals that nowhere in the petition is there any acceptable demonstration that the NLRC acted either with grave abuse of discretion or without or in excess of its jurisdiction. Petitioners merely stated generalizations and conclusions of law. Rather than discussing how the NLRC acted capriciously, petitioners resorted to a litany of generalizations.

Where to File Petition; The St. Martin Ruling 
  • From the NLRC, the case may go to the Court of Appeals. 
  • The Supreme Court has ruled in the St. Martin case that both the Supreme Court and the Court of Appeals have the power to review NLRC decisions. However, the petition for writ of certiorari should initially be filed with the Court of Appeals, in line with the principle of hierarchy of courts. (St. Martin, September 16, 1998) 
  • Furthermore, in National Federation of Labor (NFL), March 10, 1999, the Supreme Court held that challenges against rulings of the labor secretary and those acting on his behalf, like the director of labor relations, shall be acted upon by the Court of Appeals, which has concurrent jurisdiction with the Supreme Court over petitions for certiorari.
  • Bienvenido Aricayos filed a complaint for illegal dismissal against St. Martin Funeral Home before NLRC-Pampanga.
  • Private respondent was the Operations Manager of St. Martin Funeral Home but was dismissed due to alleged misappropriation of funds intended for payment of taxes. He claimed no employment contract existed, and he was not listed in the payroll.
  • St. Martin Funeral Home, argued that the private respondent was not an employee but only the uncle of the owner who merely volunteered to help out in the business as a gesture of gratitude.
  • LA: Ruled in favor of the petitioner, stating there was no employer-employee relationship between the parties.
  • NLRC: Set aside the labor arbiter's decision and remanded the case to the LA for further proceedings.
    • NLRC denied the motion for reconsideration for lack of merit, hence the petitioner filed a petition for certiorari before the SC.
  • WoN the filing of an appeal for certiorari on cases decided by the NLRC to the Supreme Court proper. NO
  • The NLRC's decision is final and executory after ten days, but the Supreme Court has maintained its power to review decisions on questions of law and jurisdiction (Judicial Review).
  • The remedy for an aggrieved party is to file a motion for reconsideration or then pursue a special civil action of certiorari under Rule 65 within 60 days from the notice of decision.
  • An amendment of Section 9 (Jurisdiction) B.P No. 129 in 1995 (R.A. No. 7902) grants the Court of Appeals exclusive appellate jurisdiction over final judgments of quasi-judicial agencies, except for cases falling within the appellate jurisdiction of the Supreme Court in accordance with the Constitution and the Labor Code.
  • The Court is, therefore, of the considered opinion that ever since appeals from the NLRC to the Supreme Court were eliminated, the legislative intendment was that the special civil action of certiorari was and still is the proper vehicle for judicial review of decisions of the NLRC.
  • While we do not wish to intrude into the Congressional sphere on the matter of the wisdom of a law, on this score we add the further observations that there is a growing number of labor cases being elevated to this Court which, not being a trier of fact, has at times been constrained to remand the case to the NLRC for resolution of unclear or ambiguous factual findings; that the Court of Appeals is procedurally equipped for that purpose, aside from the increased number of its component divisions; and that there is undeniably an imperative need for expeditious action on labor cases as a major aspect of constitutional protection to labor.
  • Therefore, all references in the amended Section 9 of B.P. No. 129 to supposed appeals from the NLRC to the Supreme Court are interpreted and hereby declared to mean and refer to petitions for certiorari under Rule 65. Consequently, all such petitions should hence forth be initially filed in the Court of Appeals in strict observance of the doctrine on the hierarchy of courts as the appropriate forum for the relief desired
  • We reiterate the judicial policy that this Court will not entertain direct resort to it unless the redress desired cannot be obtained in the appropriate courts or where exceptional and compelling circumstances justify availment of a remedy within and calling for the exercise of our primary jurisdiction.
  • Alliance of Nationalist and Genuine Labor Organization-Kilusang Mayo Uno (ANGLO-KMU) filed a petition for certification election among Cebu Shipyard and Engineering Work, Inc.'s rank and file employees.
  • Nagkahiusang Mamumuo sa Baradero — National Federation of Labor is the incumbent bargaining agent of the rank and file employees.
  • Med-Arbiter ordered ANGLO-KMU to submit documents proving its local's creation and legitimacy within five days.
  • Forced-intervenor NFL moved for dismissal, claiming ANGLO-KMU lacked legal personality, failed 25% consent requirement, and submitted requirements after the freedom period.
  • ANGLO-KMU submitted documents and argued that even if the 25% requirement was not met, Med-Arbiter could order a certification election.
  • Med-Arbiter: Dismissed the petition due to late submission of required documents..
  • Undersecretary Bienvenido E. Laguesma (by authority of the Secretary of Labor and Employment): Set aside Med-Arbiter's decision, stating ANGLO-KMU complied with registration requirements during the petition filing.
  • The NFL thus filed a special civil action for certiorari under Rule 65.
  • WoN the filing of an appeal for certiorari on cases decided by the NLRC to the Supreme Court proper. NO
  • The remedy of an aggrieved party is to timely file a motion for reconsideration as a precondition for any further or subsequent remedy, and then seasonably file a special civil action for certiorari under Rule 65 of the 1997 Rules of Civil Procedure. All such petitions should be initially filed in the Court of Appeals in strict observance of the doctrine on the hierarchy of courts.
  • The Labor Code and its implementing and related rules generally do not provide for any mode for reviewing the decision of the Secretary of Labor. It is further generally provided that the decision of the Secretary of Labor shall be final and executory after ten (10) days from notice. Yet, like decisions of the NLRC which under Art. 223 of the Labor Code become final after ten (10) days, decisions of the Secretary of Labor come to this Court by way of a petition for certiorari even beyond the ten-day period provided in the Labor Code and the implementing rules but within the reglementary period set for Rule 65 petitions under the 1997 Rules of Civil Procedure. 
  • In two instances, however, there is specific mention of a remedy from the decision of the Secretary of Labor, thus:
  • (1) Section 15, Rule XI, Book V of the amended implementing rules provides that the decision of the Secretary of Labor on appeal from the Med-Arbiter's decision on a petition for certification election shall be final and executory, but that the implementation of the Secretary's decision affirming the Med-Arbiter's decision to conduct a certification election "shall not be stayed unless restrained by the appropriate court."
  • (2) Section 5, Rule V (Execution) of the Rules on the Disposition of Labor Standards Cases in Regional Offices provides that "the filing of a petition for certiorari before the Supreme Court shall not stay the execution of the [appealed] order or decision unless the aggrieved party secures a temporary restraining order from the Court."
  • We perceive no conflict with our pronouncements on the proper remedy which is Rule 65 and which should be initially filed in the Court of Appeals in strict observance of the doctrine on the hierarchy of courts. Accordingly, we read "the appropriate court" in Section 15, Rule XI, Book V of the Implementing Rules to refer to the Court of Appeals.

Effect on NLRC's Decision 
  •  A petition for certiorari filed with the Court of Appeals or the Supreme Court shall not stay (or suspend) the execution of the assailed decision of the NLRC unless a restraining order is issued by the Court of Appeals or the Supreme Court. (Sec. 4, Rule XI, NLRC Rules of 2011) 
  • This is in contrast to the case of appeal from the labor arbiter to NLRC where, as we have seen the appeal suspends the execution of the arbiter's decision, except the reinstatement of an employee. (Sec. 9, Rule VI, and Sec. 3, Rule XI, 2011 NLRC Rules of Procedure)
Certified True Copy of NLRC Decision 
    • Numerous decisions issued by the Supreme Court emphasize that in appeals under Rule 45 and in special civil actions for certiorari under Rule 65 in relation to Rules 46 and 56, what is required to be certified is the copy of the questioned judgment, final order or resolution.
    • Since the Labor Arbiter's decision is not the questioned ruling, it does not have to be certified. What needs to be certified is the NLRC Decision. (OSM Shipping, March 5, 2003)
  • Fermin F. Guerrero filed a Complaint against OSM Shipping Philippines, Inc. and Philippine Carrier Shipping Agency Services Co. for illegal dismissal and non-payment of salaries, overtime pay, and vacation pay.
  • Labor Arbiter: Ruled in favor of Guerrero.
  • NLRC: Affirmed the decision with a modification to the amount of liability.
  • CA: Dismissed the appeal for alleged non-compliance with Section 3 of Rule 46 of the Rules of Court. Specifically, petitioner had attached to its Petition, not a duplicate original or a certified true copy of the LA's Decision, but a mere machine copy thereof.
  • WoN the petitioner has complied with Section 3 of Rule 46 of the Rules of Court. YES
  • Section 3 of Rule 46 does not require that all supporting papers and documents accompanying a petition be duplicate originals or certified true copies. Even under Rule 65 on certiorari and prohibition, petitions need to be accompanied only by duplicate originals or certified true copies of the questioned judgment, order or resolution. Other relevant documents and pleadings attached to it may be mere machine copies thereof. Numerous decisions issued by this Court emphasize that in appeals under Rule 45 and in original civil actions for certiorari under Rule 65 in relation to Rules 46 and 56, what is required to be certified is the copy of the questioned judgment, final order or resolution. Since the LA's Decision was not the questioned ruling, it did not have to be certified. What had to be certified was the NLRC Decision. And indeed it was.

Findings of Facts,  Final
  • Quasi-judicial agencies like the NLRC have acquired the expertise because their jurisdiction is confined to specific matters.
  • Hence, their findings of facts are generally accorded not only respect but at times even finality if such findings are supported by substantial evidence. (Manila Mandarin, September 21, 1987)
  • Melba C. Beloncio, an employee of Manila Mandarin Hotel, was expelled from Manila Mandarin Employees Union for alleged acts against the union's interests.
  • The union demanded Beloncio's dismissal based on the union security clause in the collective bargaining agreement, and the hotel placed her on forced leave.
  • Beloncio filed a complaint for unfair labor practice and illegal dismissal against the union and the hotel.
  • Labor Arbiter: Ruled the union guilty of unfair labor practice and ordered payment of wages, fringe benefits, exemplary damages, and attorney's fees to Beloncio.
  • NLRC: Modified the decision on appeal and ordered the union to pay the wages and benefits Beloncio from the time she was placed on forced leave until she is actually reinstated, plus attorey's fees. Manila Mandarin Hotel was ordered to reinstate Beloncio and to pay her whatever service charges may be due her during that period, which amount would be held in escrow by the hotel.
  • WoN the NLRC erred in declaring that the present controversy involved intra-union conflicts and therefor it has no jurisdiction of the subject-matter thereof. YES
  • On the issue of the NLRC jurisdiction over the case, the Court finds no grave abuse of discretion in the NLRC conclusion that the dispute is not purely intra-union but involves an interpretation of the collective bargaining agreement (CBA) provisions and whether or not there was an illegal dismissal. 
  • The Court finds nothing in the records that indicates reversible error, much less grave abuse of discretion, in the NLRC's findings of facts. It is a well-settled principle that findings of facts quasi-judicial agencies like the NLRC, which have acquired expertise because their jurisdiction is confined to specific matters, are generally accorded not only respect but at times even finality if such findings are supported by substantial evidence. 

Exceptions
  • However, the Supreme Court has never hesitated to exercise its corrective powers and to reverse administrative decisions in the following cases: 
  1. the conclusion is a finding grounded on speculations, surmises and conjectures; 
  2. the inferences made are manifestly mistaken, absurd, or impossible; 
  3. there is a grave abuse of discretion; 
  4. there is a misapprehension of facts; 
  5. the court in arriving at its findings went beyond the issues of the case and the same are contrary to the admissions of the parties or the evidence presented; 
  6. where respondent commission has sustained irregular procedures and through the invocation of summary methods, including rules on appeal, has affirmed an order which tolerates a violation of due process and
  7. where the rights of a party were prejudiced because the administrative findings, conclusions or decision were in violation of constitutional provisions, in excess of statutory authority, or jurisdiction, made upon irregular procedure, vitiated by fraud, imposition or mistake, not supported by substantial evidence adduced at the hearing or contained in the records or disclosed to the parties, or arbitrary, or capricious. (Industrial Timber, January 20, 1989)
  • Regarding compromise agreements and quitclaims the provisions of and the notes to Article 233 are pertinent .

  • Private respondents Concordia Dos Pueblos and Lolita Sanchez were employed by ITC. The workers and employees of ITC staged a strike and a Memorandum of Agreement was signed stating that all employees after the probationary period shall be considered as regular employees.
  • Petitioners admitted almost all of the striking workers, back to work, except private respondents leading to a complaint for illegal dismissal.
  • Labor Arbiter: Ruled in favor of private respondents, ordering reinstatement and payment of backwages, benefits, and damages.
  • NLRC: Upheld the decision, stating that ITC violated the Memorandum of Agreement.
  • WoN NLRC ruling should be reversed. NO
  • No cogent reason exists why the findings of fact made by the labor arbiter to the effect that an employer-employee relationship existed between the parties should be reversed. The findings of fact of quasi-judicial bodies are generally binding on the courts.  The question of whether or not an employer-employee relationship existed between the parties is a question of fact. 
  • However, this Court has never hesitated to exercise its corrective powers and to reverse administrative decisions in the following cases: (1) the conclusion is a finding grounded on speculations, surmises and conjectures; (2) the inferences made are manifestly mistaken, absurd, or impossible; (3) there is a grave abuse of discretion; (4) there is a misapprehension of facts; (5) the court in arriving at its findings went beyond the issues of the case and the same are contrary to the admissions of the parties or the evidence presented; (6) where respondent commission has sustained irregular procedures and through the invocation of summary methods, including rules on appeal, has affirmed an order which tolerates a violation of due process and (7) where the rights of a party were prejudiced because the administrative findings, conclusions or decision were in violation of constitutional provisions, in excess of statutory authority, or jurisdiction, made upon irregular procedure, vitiated by fraud, imposition or mistake, not supported by substantial evidence adduced at the hearing or contained in the records or disclosed to the parties, or arbitrary, or capricious. 
  • None of the abovementioned grounds are present which would warrant a reversal of the findings made by respondent Commission that an employer-employee relationship existed between the parties concerned.
Effect of Failure to Appeal a CA Decision 
  • Under Rule 45 of the Rules of Court, a Court of Appeals decision may be appealed to the Supreme Court on questions of law. 
  • If the CA decision is reversed, the reversal does not benefit the party that did not appeal.
    • In Atienza v. Saluta, the employee complained of illegal dismissal and unpaid employment benefits. 
    • Named as respondents were CRV Corporation and Atienza, a high official of the corporation. 
    • The case reached the Court of Appeals which ruled in favor of Saluta and against both CRV Corporation and Atienza. 
    • Atienza appealed to the SC but the Corporation did not. The SC reversed the CA decision, holding Saluta was a personal driver of Atienza, that he was not dismissed, that the applicable law was the Civil Code, not the Labor Code or the Kasambahay law.
    • Does the SC reversal of the CA decision absolved CRV Corporation from the monetary aspect of the complaint? NO.
    • It did not appeal from CA decision, which therefore, remained effective as regards the corporation.
  • Respondent Noel Sacramento Saluta claimed he was hired as a company driver by CRV Corporation and was assigned to drive for the petitioner Celia R. Atienza.
  • A vehicular accident occurred and the respondent was required to pay ₱15,000.00 for the damages. His driver's license was confiscated, and he was issued a Temporary Operator's Permit (TOP).
  • The respondent requested time off to renew his expired license, but the petitioner allegedly refused, leading to a misunderstanding. The respondent believed he had been verbally terminated when the petitioner said that "kung hindi ka makakapag-drive ngayon, mabuti pa maghiwalay na tayo." 
  • Respondent filed a complaint against CRV Corporation and the petitioner, claiming illegal dismissal and other labor-related issues.
  • Labor Arbiter: Ruled that the respondent was considered an employee of the petitioner since the employer-employee relationship with CRV Corporation was not established.
  • NLRC: Reversed the decision, finding that the petitioner failed to prove the absence of an employer-employee relationship and ordered payment of various benefits to the respondent.
  • CA: Ruled that the respondent failed to prove he was a company driver but found insufficient evidence from the petitioner to disprove the employment relationship.
  • WoN the reversal of the judgment rendered by the appellate court will inure to the benefit of CRV Corporation. NO
  • A reversal of a judgment on appeal is binding on the parties to the suit, but shall not benefit the parties against whom the judgment was rendered in the court a quo, but who did not join in the appeal, unless their rights and liabilities and those of the parties appealing are so interwoven and dependent as to be inseparable, in which case a reversal as to one operates as a reversal as to all.
  • It is basic that under the general doctrine of separate juridical personality* stockholders of a corporation enjoy the principle of limited liability: the corporate debt is not the debt of the stockholder. This is because a corporation has a separate and distinct personality from those who represent it.
  • Although a reversal of the judgment as to one would operate as a reversal as to all where the rights and liabilities of those who did not appeal and those of the party appealing are so interwoven and dependent on each other as to be inseparable, CRV Corporation and petitioner have no commonality of interest because each bears the injury of an adverse judgment. CRV Corporation will not be harmed had petitioner been held liable to pay the respondent his unpaid wages. Conversely, petitioner did not suffer any monetary injury when CRV Corporation was made liable to pay the respondent his unpaid wages.
  • Considering that CRV Corporation did not appeal me decision of the appellate court, the same stands insofar as the corporation is concerned.

Art. 224. Execution of decisions, orders or awards.

(a) The Secretary of Labor and Employment or any Regional Director, the Commission or any Labor Arbiter, or Med-Arbiter or Voluntary Arbitrator may, motu proprio or on motion of any interested party, issue a writ of execution on a judgment within five (5) years from the date it becomes final and executory, requiring a sheriff or a duly deputized officer to execute or enforce final decisions, orders or awards of the Secretary of Labor and Employment or regional director, the Commission, the Labor Arbiter or med-arbiter, or voluntary arbitrators. In any case, it shall be the duty of the responsible officer to separately furnish immediately the counsels of record and the parties with copies of said decisions, orders or awards. Failure to comply with the duty prescribed herein shall subject such responsible officer to appropriate administrative sanctions.

(b) The Secretary of Labor and Employment, and the Chairman of the Commission may designate special sheriffs and take any measure under existing laws to ensure compliance with their decisions, orders or awards and those of the Labor Arbiters and voluntary arbitrators, including the imposition of administrative fines which shall not be less than P500.00 nor more than P10,000.00.

Notes
  • (a) Writ of Execution on Judgments:
    • Who can issue a writ of execution on a judgment?
      1. The Secretary of Labor and Employment, 
      2. Regional Directors,
      3. Commission,
      4. Labor Arbiters,
      5. Med-Arbiters, or
      6. Voluntary Arbitrators 
    • How?
      • motu proprio or 
      • on motion of any interested party
    • When?
      • Within five years of it becoming final and executory.
    • What is required to execute or enforce final decisions, orders or awards?
      • sheriff or 
      • duly deputized officer
    • The responsible officer is obligated to furnish immediately the counsels of record and the parties with copies of said decisions, orders or awards.
    • Failure to fulfill duty: Administrative sanctions 
  • (b) Designation of Special Sheriffs and Compliance Measures:
    • The Secretary of Labor and Employment and the Chairman of the Commission have the authority to designate special sheriffs.
    • They are empowered to take any necessary measures, as per existing laws, to ensure compliance with their decisions, orders, or awards, as well as those of Labor Arbiters and Voluntary Arbitrators.
    • Administrative fines for non-compliance: P500.00 to P10,000.00
Execution
  • A decision or order of the NLRC or a labor arbiter that finally disposes of a case is enforced by an order or writ of execution.
  • A copy of such decision or order should have been furnished to the parties and their counsels or authorized representatives. 
  • At this stage:
    • the period for appeal has passed and no appeal had been properly filed, or 
    • the appeal itself had been decided and the decision has become final and executory. 
  • A writ of execution is issued:
    • upon motion of the winning party, or 
    • upon the initiative of the labor arbiter or the NLRC division that issued the decision or order
  • From the date, the decision or order become final and executory, the winning party has five years within which to file a motion of execution. 
  • If not executed within that period, the judgment will become dormant and may only be enforced through an independent action within 10 years from finality of the decision. 
    • If the decision or order has been properly appealed, it is not final and cannot be executed.
      But an order to reinstate an illegally dismissed employee, even if appealed, is immediately executory, as explained under Article 229.
Injunction Against NLRC from a Regular Court
  • Precedents (or previous court decisions) abound confirming the rule that regular courts (e.g., regional trial courts) have no jurisdiction to act on labor cases or their incidents including the execution of decisions awards or order.
  • Jurisdiction to try and decide such cases pertains exclusively to the proper Iabor official under the Department of Labor and Employment. 
  • To hold otherwise is to sanction split jurisdiction which is obnoxious to the orderly administration of Justice. (Deltaventures Resources, March 9, 2000)
  • However, the general rule that no court has the power to interfere by injunction with the judgment or decrees of another court with concurrent or coordinate jurisdiction possessing equal power to grant injunctive relief applies only when no third party claimant is involved. (Read Traders Royal Bank v. Immediate Appellate Court, 1984) 
  • When a third party or a stranger to the action asserts a claim over the property levied upon, the claimant may be vindicate his claim by an independent action in the proper civil court, which may stop the execution of the judgment on property not belonging to the judgment debtor. (Yupangco Cotton Mills, January 16 2002)
    • A separate civil action for recovery of ownership of the property would not constitute interference with the powers or processes of the arbiter and the NLRC, which render the judgment to enforce and execute upon the levy properties. The property levied upon being that of a stranger is not subject to levy. Thus, a separate action for recovery upon a claim and prima facie showing of ownership by the petitioner cannot be considered as interference.
    • In other words, an action for recovery of property is an exception to the rule that the execution of an NLRC order or decision cannot be stopped by regular court.
  • The Labor Arbiter issued a decision declaring respondents guilty of illegal dismissal and unfair labor practice and issued a writ of execution garnishing certain personal properties of respondents.
  • One month before the auction sale, petitioner Deltaventures Resources filed a third-party claim asserting ownership over the levied property.
  • Petitioner filed a complaint for injunction and damages in the RTC.
  • Petitioner also questioned the authority of the Commission to hear the case, the matter being within the jurisdiction of the regular courts. 
  • RTC: Dismissed petitioner's amended third-party complaint, citing lack of jurisdiction as it is equal in rank to the NLRC.
  • Petitioner argued that the case doesn't involve an employer-employee relationship and is not within the jurisdiction of the Commission.
  • WoN the trial court may take cognizance of the complaint filed by petitioner and consequently provide the injunction relief sought. NO
  • It must be noted that the Labor Code in Article 254 explicitly prohibits issuance of a temporary or permanent injunction or restraining order in any case involving or growing out of labor disputes by any court or other entity (except as otherwise provided in Arts. 218 and 264). As correctly observed by court a quo, the main issue and the subject of the amended complaint for injunction are questions interwoven with the execution of the Commission's decision. 

  • Traders Royal Bank filed a suit on March 18, 1983, against Remco Alcohol Distillery, Inc. (REMCO) for the recovery of P2,382,258.71 and obtained a writ of pre-attachment against REMCO's assets.
  • Deputy Sheriff levied 4,600 barrels of alcohol at REMCO.
  • La Tondeña, Inc. filed a third-party claim, asserting ownership over the attached property.
    • La Tondeña filed a complaint-in-intervention but later filed a motion to withdraw.
    • RTC-Pasay: Initially granted the motion but later reconsidered, declaring the alcohol still owned by REMCO.
  • La Tondeña filed a civil case in RTC-Bulacan, claiming ownership and seeking a preliminary injunction.
  • Traders Royal Bank opposed the motion and filed a motion to dismiss.
  • RTC-Bulacan: Issued an order declaring La Tondeña as the owner and granting the injunction.
  • Traders Royal Bank filed a petition to annul the RTC-Bulacan order and dissolve the injunction.
  • Intermediate Appellate Court: Dismissed the petition, citing no legal and factual basis.
  • WoN the a Regional Trial Court has the authority issue, at the instance of a third-party claimant, an injunction enjoining the sale of property previously levied upon by the sheriff pursuant to a writ of attachment issued by another Regional Trial Court. YES
  • Generally, the rule that no court has the power to interfere by injunction with the judgments or decrees of a concurrent or coordinate jurisdiction having equal power to grant the injunctive relief sought by injunction, is applied in cases where no third-party claimant is involved, in order to prevent one court from nullifying the judgment or process of another court of the same rank or category, a power which devolves upon the proper appellate court. The purpose of the rule is to avoid conflict of power between different courts of coordinate jurisdiction and to bring about a harmonious and smooth functioning of their proceedings.

  • Petitioner Yupangco Cotton Mills claimed that the sheriff of the National Labor Relations Commission (NLRC) erroneously levied on properties it owned.
  • Various actions were taken by the petitioner in connection with its claim:
    1. Filed a notice of third-party claim with the Labor Arbiter on May 4, 1995.
    2. Filed an Affidavit of Adverse Claim with the NLRC on July 4, 1995, dismissed by the Labor Arbiter on August 30, 1995.
    3. Filed a petition for certiorari and prohibition with the Regional Trial Court (RTC) on October 6, 1995, dismissed  on October 11, 1995.
    4. Appealed to the NLRC on December 8, 1995, against the Labor Arbiter's dismissal.
    5. Filed an original petition for mandatory injunction with the NLRC on November 16, 1995, still pending.
    6. Filed a complaint in the RTC-Manila, docketed as Civil Case No. 95-76395, dismissed, leading to the current petition.
  • CA: Dismissed the petition on the grounds of forum shopping and advised seeking relief from the Supreme Court.
  • WoN the Court of Appeals erred in dismissing the petitioner's accion reinvindicatoria on the ground of lack of jurisdiction of the trial court. YES
  • A third party whose property has been levied upon by a sheriff to enforce a decision against a judgment debtor is afforded with several alternative remedies to protect its interests. The third party may avail himself of alternative remedies cumulatively, and one will not preclude the third party from availing himself of the other alternative remedies in the event he failed in the remedy first availed of. Thus, a third party may avail himself of the following alternative remedies:
  • a) File a third party claim with the sheriff of the Labor Arbiter, and 
    b) If the third party claim is denied, the third party may appeal the denial to the NLRC.
  • The filing of a third party claim with the Labor Arbiter and the NLRC did not preclude the petitioner from filing a subsequent action for recovery of property and damages with the Regional Trial Court. And, the institution of such complaint will not make petitioner guilty of forum shopping.
  • A separate civil action for recovery of ownership of the property would not constitute interference with the powers or processes of the Arbiter and the NLRC which rendered the judgment to enforce and execute upon the levied properties. The property levied upon being that of a stranger is not subject to levy. Thus, a separate action for recovery, upon a claim and prima-facie showing of ownership by the petitioner, cannot be considered as interference.
Third Party Claim Under the NLRC Rules of 2011
  • Under Rule XI of the NLRC Rules of 2011, a third party claim should be filed within five days from the last day of posting or publication of the notice of execution sale; other wise, the claim is forever barred. 
  • The third party claimant has to file with the commission or labor arbiter an affidavit stating his title to the property or right to possess it with supporting evidence. 
  • Receipt of such claim automatically suspends the execution over the property. 
  • The third party claimant may be required to post a bond equal to the amount of his claim; the party seeking the execution may file a counter-bond. The labor arbiter shall resolve the third party claim within 10 working days following the submission of the claim for resolution.

Art. 225. Contempt powers of the Secretary of Labor. 
In the exercise of his powers under this Code, the Secretary of Labor may hold any person in direct or indirect contempt and impose the appropriate penalties therefor.


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