G.R. No. L-18442 November 30, 1962
RIZAL CEMENT WORKERS UNION (FFW), petitioner, vs. COURT OF INDUSTRIAL RELATIONS and RIZAL CEMENT CO., INC., respondents.

FACTS

The Rizal Cement Workers Union sent collective bargaining proposals to Rizal Cement Company in September 1954. The company refused to negotiate, citing a pending case (No. 676-V) involving similar demands. After further exchanges, the Union filed a Notice of Strike. Subsequently, the company entered into a collective bargaining agreement with a different union, the Binangonan Labor Union (NWB). On May 27, 1956, the petitioner Union declared a strike. The dispute was later certified by the President to the Court of Industrial Relations (CIR).
The CIR found the strike was generally peaceful, though some isolated violent incidents occurred, including the death of a company timekeeper. No striker was convicted by final judgment for any criminal act. The CIR concluded the strike was justified as one against unfair labor practices, not a mere economic strike. Consequently, it ordered the company to reinstate all striking union members to their former positions but denied their claim for back wages. Both parties moved for reconsideration; the CIR en banc denied both motions. Only the Union appealed, contesting the denial of back wages.

ISSUE

Whether the Court of Industrial Relations committed an error or grave abuse of discretion in ordering the reinstatement of the striking workers without awarding them back wages.

RULING

The Supreme Court affirmed the CIR decision, ruling that the denial of back wages was within the court’s discretionary power and not a reversible error. The legal logic rests on the nature of the CIR’s authority in certified cases. Upon presidential certification of a labor dispute under Section 10 of Republic Act No. 875 , the case falls under the operation of Commonwealth Act No. 103 , which governs compulsory arbitration for industries indispensable to the national interest. This grants the CIR broad powers of arbitration, including the authority to fix the terms and conditions of employment as part of its equitable solution to the dispute.
The Court cited established jurisprudence, notably Philippine Marine Radio Officers Association vs. CIR, which holds that the CIR’s power to fix employment terms necessarily includes the discretion to order reinstatement with or without back pay. This discretionary award considers the totality of circumstances, balancing the equities between labor and capital. Here, while the strike was deemed justified, the CIR also noted that the employer suffered losses due to the strike’s occurrence and the isolated acts of violence accompanying it. The decision to deny back wages placed both parties in a position where neither gained an advantage from the other’s fault, reflecting an equitable compromise within the CIR’s arbitral powers. The Supreme Court found no cogent reason to overturn this exercise of discretion, as the CIR acted within its jurisdiction and did not commit grave abuse thereof.