G.R. No. 116839 July 13, 1998
LABOR CONGRESS OF THE PHILIPPINES (LCP) FOR AND IN BEHALF AND IN REPRESENTATION OF ITS MEMBERS, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION, BUN SIT G. CHUNG (ALIAS) CARLOS CHUNG; CHUNG BUN SU, PHILIP CHUNG BUN LIM, VICTORINO C. PERLAS, ELEAZAR TOLLEDO, NATHANIEL A. DELFIN, BAYANI C. DELGADO, TEODORO E. PUNZALAN, GERARDO C. REYES, VILMA C. PULUMBARIT — JOINTLY WITH LUCKY TEXTILE MILLS, INC., FAMILYTEX INC. NEW WORLD AND WALDEN STYLE BUSINESS NAMES, respondents.

LCP FOR AND IN BEHALF & IN REPRESENTATION OF ITS MEMBERS, ETHELWALDO MUNOZ, JESUS LLEVA, PRINCIPE ROLANDO, SABATIN PEDRITO, SAMONTE REYNALDO, ALFREDO CASTILLO, ALFREDO FILOMENO, SERGIO BAUTISTA, ELIZABETH MANALO, ALBERTO REYNALDO, ANGELINA AMOS, EDUARDO T. LEGASPI, FELIXBERTO BERBOSO, EDUARDO DELA CRUZ, ROMEO YALUNG, REYES ESMERANDO, PALABAY WILFREDO, VELENTINO VALDEDO, IMELDA ANZURES, TEDDY PANTANILLA, ARMANDO MANUEL, ALFONSO CAMUA, JUANITO ENBUIDO, ALFREDO OLAZO, MA. DIVINA GATCHALIAN, ARTURO ZUNGA, RENATO BAUTISTA, BENEDICTO ESPEJO, DEL ROSARIO EDGARDO, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION, LUCKY TEXTILE MILLS, INC., FAMILY TEXTILE MILLS, INC., NEW WORLD TEXTILE COMPANY & WALDEN TEXTILE INDUSTRIES, INC., JOINTLY WITH BUN SIT G. CHUNG (ALIAS) CARLOS CHUNG BUN LIM, SONIA CHU & PROCESO PAREDES, respondents.
LCP FOR AND IN BEHALF & IN REPRESENTATION OF ITS MEMBERS, DYETO CUSTODIO, RIVERA RUBEN, JERRY ORILLA, JUANITO FABILLAR, MARIO CALARA, MARIO RAYMUNDO, TEODORO POUNTAN, RAMON BAUTISTA, EDITA ANDRES, JOSEPHINE WINGCO, MARISOL REY, CRISENCIA PACHECO, JESUS SUERIE FELIPE, REYNALDO AVENDANO, RADITO DELA CRUZ, FLORA JUSON, AMADOR MENDEZ, CARLOS DE GUZMAN, EMILIANO ESCOTO, FLORENCIO RONIO, CARMEN ANOS, ANGELITA DELOS SANTOS, ROSEMARY DELA CRUZ, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION, LUCKY TEXTILE MILLS, INC., FAMILY TEXTILE MILLS INC., NEW WORLD TEXTILE COMPANY & WALDEN TEXTILE INDUSTRIES, INC. JOINTLY WITH BUN SIT G. CHUNG, (ALIAS) CARLOS CHUNG BUN LIM, SONIA CHU & PROCESO PAREDES, BUN LIM, respondents.
LCP FOR AND IN BEHALF AND IN REPRESENTATION OF ITS MEMBERS, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION, BUN SIT G. CHUNG (ALIAS) CARLOS CHUNG BUN SU, PHILIP CHUNG BUN LIM, VICTORIANO C. PERLAS, ELEAZAR S. TOLLEDO, NATANIEL A. DELFIN, BAYANI C. DELGADO, TEODULO E. PUNZALAN, GERARDO C. REYES, VILMA C. PULUMBARIT, JOINTLY WITH LUCKY TEXTILE MILLS, INC., FAMILY TEXTILE INC. NEW WORLD TEXTILE COMPANY AND WALDEN STYLE BUSINESS NAME, respondents.

FACTS

Respondent Lucky Textile Mills, Inc. (Lucky) is a corporation engaged in textile manufacturing. Petitioner Labor Congress of the Philippines (LCP) represents the individual petitioners who were employees of Lucky and former members of the union Nagkakaisang Manggagawa sa Lucky — NAFLU (NML-NAFLU). Since the later part of 1980, Lucky suffered financial losses due to the Gulf Crisis, slowdown in production, and walkouts. In February 1991, employees, through NML-NAFLU, staged a strike agitating for wage order implementation. This strike was adjudged illegal by the Labor Arbiter and the NLRC, lasted about four months, stopped productive operations, and eventually led to Lucky’s closure. Lucky sent letters dated March 12 and 15, 1991, to the DOLE and the union, informing them of the projected closure effective April 18, 1991, due to financial losses and adverse business conditions. On June 13, 1991, Lucky entered into an agreement with NML-NAFLU stipulating the union’s acceptance of the closure, termination of employment as of April 18, 1991, lifting of picket lines, payment of separation/retirement pay, and the signing of release forms upon payment. All employees, including individual petitioners, received their separation pay and signed release papers/quitclaims. Lucky later leased its building and equipment to three other corporations: Family Textile Inc., New World Textile, and Walden Textile Industries. Believing Lucky had resumed operations, its former employees sought reemployment but were not heeded. They filed complaints for Unfair Labor Practice, illegal Lockout and/or illegal Dismissal, alleging the closure was to “bust the strikers,” the three other corporations were conduits, they signed release papers under desperate circumstances, and they were assured of recall if operations resumed. Lucky contended the closure was due to severe financial losses, it granted separation pay even without obligation, employees were not forced to sign quitclaims, and the three corporations were separate entities with which it had a lessor-lessee relationship. The Labor Arbiter ruled in favor of Lucky, finding the closure a valid exercise of management prerogative and the other corporations as independent entities. The NLRC affirmed the Labor Arbiter’s decision. Petitioners filed the present petition imputing grave abuse of discretion to the NLRC.

ISSUE

Whether the dismissal of all employees of Lucky Textile Mills, Inc. was a valid exercise of management prerogative to close business operations due to severe financial reverses under Article 283 of the Labor Code, or was in reality a form of union busting.

RULING

The dismissal was a valid exercise of management prerogative. The petition is not meritorious. The factual findings of the Labor Arbiter, affirmed by the NLRC, are supported by substantial evidence and are entitled to great respect. The closure was necessitated by unabated losses, not an act of discrimination or union busting. Lucky complied with Article 283 of the Labor Code by serving written notice to the workers and the DOLE at least one month before the closure. The individual petitioners, through their bargaining agent, entered into an agreement with Lucky, accepted separation pay, and executed quitclaims and release papers, which constitute legitimate waivers from a voluntary settlement. The three other corporations are separate and distinct entities, as evidenced by their articles of incorporation and lease agreements, and are merely lessees of Lucky’s assets. The Supreme Court discerned no basis to deviate from the factual findings of the quasi-judicial agencies. The issue that the quitclaim terms in English were not explained to the workers is raised for the first time in this petition and is improper for consideration. The petition is DISMISSED and the challenged Resolution of the NLRC is AFFIRMED.