[CASE DIGEST] GENERAL MILLING CORPORATION v. ERNESTO CASIO, et al. (G.R. No. 159117)

March 10, 2010 

Ponente: Leonardo-De Castro, J.

FACTS:

·         Chapter president Ernesto Casio and other employees of General Milling Corp. (GMC), comprised of regular employees and union shop stewards, were accused by the members and officers of Ilaw at Buklod ng Manggagawa Local 31 Chapter (IBM-Local 31), the SEBA of GMC, of having committed acts inimical to the interest of the union. Through a letter, the accused employees were told to file within 3 days their answers to the accusations lodged against them. Casio, et al. refused to acknowledge said letter, so the union proceeded to conduct an investigation ex parte, eventually finding the accused employees guilty. Consequently, Casio, et al. were expelled from the union. 

·         Citing the closed shop provision in the CBA, Rodolfo Gabiana, the IBM Regional Director for Visayas and Mindanao, requested GMC to terminate Casio, et al. When the management of GMC did nothing, a second request was sent, reiterating the union's request for the immediate dismissal of Casio, et al., this time with a threat that failure to effect the accused employees' dismissal would constrain the union to file a ULP complaint against the company for gross violation of the CBA. 

·         Pressured by the threatened filing of a suit for ULP, GMC acceded to the union's request to terminate the employment of Casio, et al.

·         Casio, et al. proceeded to seek judicial relief as follows:

o   Casio , et al., in the name of IBM-Local 31, filed a Notice of Strike with the NCMB. Casio, et al. alleged as bases for the strike the illegal dismissal of union officers and members, discrimination, coercion, and union busting. The NCMB-RO held conciliation proceedings, but no settlement was reached among the parties.

o   Casio, et al. next sought recourse from the NLRC by filing a complaint for ULP against GMC and the union officers, particularly the termination of legitimate union officers, illegal suspension, illegal dismissal, and moral and exemplary damages. The LA dismissed the complaint for lack of jurisdiction and endorsed it to the NCMB because it was found that the case did not undergo voluntary arbitration. The parties, however, agreed to submit themselves to the company's grievance machinery procedure.

o   Back at GMC, the SEBA (IBM-Local 31) failed to hold grievance proceedings on Casio, et al.'s complaint, so the voluntary arbitrator from NCMB assumed jurisdiction over the same.

o   VA's ruling: Dismissal of Casio, et al. was valid. The dismissed employees were nonetheless entitled to separation pay and attorney's fees.

o   Casio, et al. filed an appeal with the CA, which ruled in their favor. According to the CA, while the dismissal of Casio, et al., was made by GMC pursuant to a valid closed shop provision under the CBA, the company, however, failed to observe the elementary rules of due process in implementing the said dismissal. Therefore, their dismissal was illegal. GMC's MR was denied, hence the instant petition.

RULING:  

Petition denied.

Whether Casio, et al. were illegally dismissed. – YES.

·         GMC: The VA's finding that the dismissal of Casio, et al. was valid should be conclusive. GMC asserted that prior to their dismissal, Casio, et al. were already accorded the opportunity to defend themselves by the union, only that they refused to take part in the union investigation. GMC also averred that it had no authority to investigate whether Casio, et al. were indeed disloyal to the union because such an issue was an internal affair of the union. And finally, it should be the union officers, not the company, which should be held liable for the reinstatement of and payment of full backwages to Casio, et al. for the company had acted in good faith and merely complied with the closed shop provision in the CBA.

·         CASIO: To accord them due process, GMC itself, as the employer, should have held proceedings distinct and separate from those conducted by the union. GMC cannot justify its failure to conduct its own inquiry using the argument that such proceedings would constitute an intrusion by the company into the internal affairs of the union. The claim of GMC that it had acted in good faith when it dismissed them from service in accordance with the closed shop provision of the CBA is inconsistent with the failure of the company to accord the dismissed employees their right to due process.

·         COURT:  The dismissal of Casio, et al. was illegal, having been done without just cause and the observance of procedural due process.

·         In terminating the employment of an employee by enforcing the union security clause, the employer needs only to determine and prove that: (1) the union security clause is applicable; (2) the union is requesting for the enforcement of the union security provision in the CBA; and (3) there is sufficient evidence to support the decision of the union to expel the employee from the union. These requisites constitute just cause for terminating an employee based on the union security provision of the CBA.

·         As applied in the present case, the CBA between GMC and IBM-Local 31 included a maintenance of membership and closed shop clause. It is similarly undisputed that IBM-Local 31 requested GMC to terminate the employment of Casio, et al. as a necessary consequence of their expulsion from the union. It is the third requisite that there is sufficient evidence to support the decision of IBM-Local 31 to expel Casio, et al. which appears to be lacking in this case. The failure of GMC to make a determination of the sufficiency of evidence supporting the decision of IBM-Local 31 to expel Casio, et al. is a direct consequence of the non-observance by GMC of procedural due process in the dismissal of employees.

·         GMC also failed to discharge the twin requirements of notice and hearing. GMC cannot dispense with these requirements before dismissing Casio, et al. even when said dismissal is pursuant to the closed shop provision in the CBA. The rights of an employee to be informed of the charges against him and to reasonable opportunity to present his side in a controversy with either the company or his own union are not wiped away by a union security clause or a union shop clause in a collective bargaining agreement.

·         In sum, the Court finds that GMC illegally dismissed Casio, et al. because not only did GMC fail to make a determination of the sufficiency of evidence to support the decision of IBM-Local 31 to expel Casio, et al., but also to accord the expelled union members procedural due process, i.e., notice and hearing, prior to the termination of their employment.

Whether GMC can choose not to conduct its own investigation and merely rely on the assertions of the union. – NO.

·         GMC: The acts of the union officers in expelling Casio, et al. from the union enjoy presumption of regularity in the performance of official duties. As such, there is no need for the company to conduct a separate investigation. 

·         COURT: The presumption of regularity applies only to public officers from the highest to the lowest in the service of the Government, departments, bureaus, offices, and/or its political subdivisions, NOT to union officers.

Whether GMC should be held liable for the payment of backwages and damages to Casio, et al. – YES.

·         GMC:  The company should not be held liable for the payment of backwages and damages to Casio, et al. Instead, the liability for such payment should fall only upon the union officers and board members who expelled Casio, et al. 

·         COURT: The expulsion of Casio, et al. by IBP-Local 31 and the termination of employment of the same employees by GMC, although related, are two separate and distinct acts. Despite a closed shop provision in the CBA and the expulsion of Casio, et al. from IBP-Local 31, law and jurisprudence impose upon GMC the obligation to accord Casio, et al. substantive and procedural due process before complying with the demand of IBP-Local 31 to dismiss the expelled union members from service. The failure of GMC to carry out this obligation makes it liable for illegal dismissal of Casio, et al.