G.R. No. 103219 May 18, 1993
PETER PAUL PHILIPPINES CORPORATION, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION, NORBERTO VILLADIEGO, ROMULO GARCIA, ROLANDO CARINGAL, RESTITUTO CONCHELA, FELICIANO AQUINO and VIRGILIO PABELLANO, respondents.

FACTS

The private respondents were employed as company guards by petitioner Peter Paul Philippines Corporation. On April 28, 1984, Presidential Decree No. 1919 was issued, prohibiting the issuance of a license to any company guard force with less than thirty members. Consequently, the petitioner’s guard force, which had fewer than thirty members, was disbanded. The services of the private respondents were terminated on March 11, 1985, and they were all granted and accepted separation pay without protest. On June 15, 1989, the private respondents filed a complaint against the petitioner, alleging that the company failed to grant them the right to recommend their substitutes as provided under Article IV of their Collective Bargaining Agreement (CBA). The Labor Arbiter ruled in favor of the private respondents, a decision affirmed by the National Labor Relations Commission (NLRC), which relied heavily on a prior NLRC case, Macasaet v. Peter Paul. The petitioner then filed the present petition, arguing that the NLRC committed grave abuse of discretion.

ISSUE

Whether or not the private respondents, as terminated company guards, are entitled under the CBA to recommend substitutes for their positions after the abolition of those positions due to the disbandment of the company’s guard force.

RULING

The Supreme Court ruled in favor of the petitioner, setting aside the challenged decision of the NLRC. The Court held that the private respondents are not entitled to the right of substitution under the CBA for two primary reasons. First, the private respondents, as company guards, are expressly excluded from the coverage of the CBA under its Article I (A), which recognizes the union as the exclusive agent for all regular non-supervisory employees “excluding supervisory, Security Guards, and the Monthly Employees.” Second, even assuming they were covered, their claim must fail because the CBA provision on substitution applies only to vacancies arising from “death, disability or retirement” of an employee. The termination of the private respondents resulted from the abolition of their positions due to the legal disbandment of the guard force, not from any of the enumerated causes. Abolition of a position does not create a vacancy; a vacancy presupposes an existing position without an incumbent. Furthermore, the private respondents’ claim was filed more than four years after their termination, which constitutes an unreasonable delay and is barred by laches and prescription under Article 290 of the Labor Code. The Court also distinguished the Macasaet case, noting it involved retirement, not abolition of position, and the appointee was hired for a different role based on her own qualifications, not merely as a substitute. The petition was granted, and the temporary restraining order was made permanent.