In a recent decision, the Supreme Court of the Philippines denied a petition for certiorari filed by Malayan Employees Association-Federation of Free Workers (MEA-FFW) and its member Rodolfo Mangalino for lack of merit and procedural shortcomings, specifically its late filing that rendered the CA decision final. The said petition aims to set aside the June 26, 2007 decision and the November 29, 2007 resolution of the Court of Appeals (CA) in CA-G.R. SP No. 80691, ruling that the suspension imposed by the respondent Malayan Insurance Company, Inc. on union member Mangalino is valid. Mangalino was suspended for taking a union leave without the prior authorization of his department head and despite a previous disapproval of the requested leave.


Grievance, Mediation, Arbitration and Appeals
A collective bargaining agreement (CBA) between MEA-FFW and the company was adopted by the representatives of both parties. A provision in this CBA allows union officials to avail of union leaves with pay for a total of “ninety-man” days per year for the purpose of attending to union activities.

Thereafter, the company issued a rule in November 2002 requiring not only the “prior notice” that the CBA explicitly requires, but “prior approval” by the department head before the union and its members can avail of union leaves. The rule took effect in November 2002 without any objection from the union until a union officer, Mangalino, filed union leave applications in January and February, 2004. His department head disapproved the applications because the department was undermanned at that time.

In spite of the disapproval, Mangalino proceeded to take the union leave. He said he believed in good faith that he had complied with the existing company practice and with the procedure set forth in the CBA. The company responded by suspending him for one week and, after that, for a month, for his second offense in February 2004.

The union considered the suspensions as a grievance issue and after going through the grievance procedure in vain, including the referral of the matter to the company’s president, Yvonne Yuchengco, the union went to the National Conciliation and Mediation Board for preventive mediation. When this option also failed, the issue of the legality of the suspensions was presented to a Panel of Voluntary Arbitrators on the following issues: 1) whether or not Mangalino’s suspensions were valid; and 2) whether or not Mangalino should be paid backwages for the duration of the suspensions.

On November 26, 2004, the Voluntary Arbitrators came up with a non-unanimous decision. They stated that the suspension of Mr. Rodolfo Mangalino’s on the first availment of union leave was invalid while the second suspension was valid but illicit in terms of penalty of thirty (30) days suspension. Thus, the supposedly thirty seven (37) days suspension period was reduced to ten (10) days only. Henceforth, the Complainant was entitled to twenty seven (27) days backwages.

The company appealed the decision to the CA on May 12, 2005 through a petition for review under Rule 43 of the Rules of Court. In a decision promulgated on June 26, 2007, the CA granted the company’s petition and upheld the validity of Mangalino’s suspension on the basis of the company’s “management prerogative” to prescribe reasonable rules to regulate the use of union leaves.
The union moved for the reconsideration of the CA decision and received the CA’s denial (through its resolution of November 29, 2007) on December 8, 2007.

Supreme Court Ruling

After reviewing all the company’s comments, the union’s reply, memoranda and other premises regarding the petition, the Supreme Court decided to take it up as a petition for review on certiorari under Rule 45 instead of a petition for certiorari under Rule 65 of the Rules of Civil Procedure. Because of the delay in the filing of the said petition, the CA decision had lapsed to finality by the time the petition was filed. Furthermore, in Malayan Employees Association-FFW vs. Malayan Insurance Co., Inc., with G.R. No.181357, the highest appellate court’s 2nd Division composed of ponente Associate Justice Arturo D. Brion, Associate Justices (Chairperson) Antonio T. Carpio, Renato C. Corona, Presbitero J. Velasco, Jr. and Jose P. Perez, concluded.

While it is true that the union and its members have been granted union leave privileges under the CBA, the grant cannot be considered separately from the other provisions of the CBA, particularly the provision on management prerogatives where the CBA reserved for the company the full and complete authority in managing and running its business. We see nothing in the wordings of the union leave provision that removes from the company the right to prescribe reasonable rules and regulations to govern the manner of availing of union leaves, particularly the prerogative to require prior approval. Precisely, “prior notice” is expressly required under the CBA so that the company can appropriately respond to the request for leave. In this sense, the rule requiring “prior approval” only made express what is implied in the terms of the CBA…

The union accepted this regulation without objection since its promulgation (or more than a year before the present dispute arose), and the rule on its face is not unreasonable, oppressive, nor violative of CBA terms. Ample evidence exists in the records indicating the union’s acquiescence to the rule. Notably, no letter from the union complaining about the unilateral change in policy or any request for a meeting to discuss this policy appears on record…

The “prior approval” policy [of the company] fully supported the validity of the suspensions the company imposed on Mangalino. We point out additionally that as an employee, Mangalino had the clear obligation to comply with the management disapproval of his requested leave while at the same time registering his objection to the company regulation and action. That he still went on leave, in open disregard of his superior’s orders, rendered Mangalino open to the charge of insubordination, separately from his absence without official leave. This charge, of course, can no longer prosper even if laid today, given the lapse of time that has since transpired… (emphasis added)

Comment on the SC Ruling

From the given facts, the CBA only requires “prior notice” of availment of the 90-day union leave. Then, the company issued a memorandum “regulating” the availment of union leave by requiring “prior approval” of applications for the said availment. In its comment on the union’s petition, it even defended the new rule by saying that the regulation of the use of union leaves is within the company’s management prerogative, and the company was simply exercising this prerogative when it required its employees to first obtain the approval of either the department head or the human resource manager before making use of any union leave. This raises the question: Can the management unilaterally amend the CBA? Article 253 of the Labor Code states that the CBA cannot be modified during its lifetime, even by mutual agreement. The CBA can only be modified or amended with respect to the 4th and 5th years thereof or after the 5-year term has expired. Sad to say, the SC based the validity of the suspension on the company’s memorandum, which in turn the SC validated because of the union’s acquiescence thereto.

It would have been correct for the SC to declare the suspension invalid because the memorandum is void for being violative of the law which prohibits any modification of the CBA without justifiable reasons. Instead of saying that Mangalino exposed himself to charges of AWOL and insubordination, the SC should have declared the company guilty of unfair labor practice for suspending him on account of his union activities.

The lesson we learned from this decision, is for union officers to be vigilant with trade union rights set forth in the CBA. By not protesting the company’s memorandum, by remaining silent, which silence means consent, the exercise of a right to avail of union leave became a just cause for suspension or even dismissal for AWOL as the SC opined.
We disagree with the SC’s ruling that the issuance of the memorandum regulating union leave availments is a valid exercise of the company’s management prerogative. It is not management’s prerogative to amend the CBA to make it difficult for union members to avail of union leave. It is not management’s prerogative to violate the CBA. Management prerogatives end where the rights of workers begin.

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