G.R. Nos. 91223-26 July 30, 1990
MANILA PORT SERVICES, INC., petitioner, vs. HON. ARTHUR G. AMANSEC AND ADRIANO YUMUL, PABLITO REANDELAR, MACARIO DE LUNA, JR., ADAN MENDOZA, SMITH CARLOTA, EMERECIANO VERGARA, ROMEO ABACAN, LEONARDO ROMULO, ELINO JOSE, and CATINDIANO CALUAG (COLLECTIVELY CALLED AWUM), respondents.

FACTS

The case originated from a labor dispute involving the Associated Workers Union (AWU) and the arrastre contractor, Metro Port Service, Inc. (Metro). On October 26, 1984, AWU filed a notice of strike. The dispute was later certified for compulsory arbitration, prohibiting strikes. During this period, individual respondents formed a separate local chapter, AWUM, leading AWU to expel them for disloyalty. Invoking a closed-shop CBA provision, AWU demanded their termination. Metro initially resisted but, following an illegal strike staged by AWU, entered into a Compromise Agreement on April 18, 1985, agreeing to preventively suspend the individual respondents. The individual respondents filed a complaint for illegal suspension. Multiple cases were consolidated before the NLRC, which, in a September 4, 1986 Decision, ruled the suspension illegal and ordered the reinstatement of the individual respondents with backwages, to be paid solidarily by AWU and Metro. During the proceedings, Marina Port Services, Inc. (Marina) assumed arrastre operations from Metro.

ISSUE

The primary issue was the determination of liability for the payment of backwages to the illegally suspended employees, specifically whether liability should be solidary between the union and the employer, and how such liability is affected by a change in corporate identity of the employer.

RULING

The Supreme Court modified the NLRC decision. It held that the individual respondents’ act of forming a local chapter was a protected activity and did not constitute disloyalty justifying expulsion or termination under the closed-shop agreement. The Court affirmed that both AWU and Metro were liable for the illegal suspension. AWU was liable for instigating the dismissal through its coercive actions, including an illegal strike, and for invoking the invalid closed-shop clause. Metro was liable for capitulating to union pressure and suspending the employees without the requisite due process. However, the Court ruled that their liability should be joint and several, not solidary, apportioning responsibility on a 50-50 basis for the period of suspension covered by their shared fault. Furthermore, the Court ruled that Marina, as the successor-in-interest to Metro’s arrastre operations, assumed the latter’s liabilities arising from the labor dispute, including the obligation to pay backwages for periods following its assumption of operations. The decision was thus modified to reflect the apportioned liability between AWU and Metro/Marina and to clarify the periods for which each entity was responsible.