G.R. No. L-20143 January 27, 1969
PHILIPPINE AMERICAN EMBROIDERIES, INC., ALBERT NASSER and JACK NASSER, petitioners, vs. EMBROIDERY & GARMENT WORKERS UNION, respondent.

FACTS

This case originated from a complaint for unfair labor practice under Republic Act No. 875 filed by the Embroidery and Garment Workers Union against Philippine American Embroideries, Inc., its corporate officers Albert Nasser and Jack Nasser, and another union. The complaint alleged violations of Section 4(a)(1), (4), and (6). The trial judge dismissed the complaint, but the Court of Industrial Relations (CIR) en banc, by a divided vote, reversed and found the company and its officers guilty of unfair labor practice under Sections 4(a)(4) and (6), ordering the reinstatement of union members with back wages. The CIR en banc based its resolution on facts it deemed “indubitable and non-controversial,” including: the company’s management by the Nasser brothers; the start of its machine-made department in 1956; its practice of laying off employees who could not fulfill quotas; the organization of the complainant union in October 1958 with about 170 members; the union’s letter to the company on October 31, 1958, informing of its existence, majority status, and desire to bargain collectively; the company’s receipt of collective bargaining proposals on November 3, 1958; the company’s announcement on the afternoon of November 3, 1958, of the closure of the Machine Made Department and the opening of a new Knitting Gloves Department, dismissing all union members; the company’s reply on November 15, 1958, asking the union to first prove its majority via CIR certification; the filing of the unfair labor practice case on November 26, 1958; the union members’ unconditional offer to work on April 4, 1959; and the company’s refusal of the collective offer, insisting on individual applications. The petitioners, while not disputing these facts, averred that the resolution failed to consider other material facts found by the trial judge, such as: the company had been informing workers since early 1958 about losses in the machine-made department; the financial statements showed losses of P62,444.55 in 1957 and P45,872.47 in 1958; and the closure was due to these continued losses, not union activity. The trial judge also found the company had an existing collective bargaining agreement with another union, the Kapisanang Manggagawa sa Phil-American Embroideries, Inc.

ISSUE

Did the respondents commit unfair labor practice by refusing to bargain and by discriminating against union members through the closure of the Machine Made Department?

RULING

No. The Supreme Court reversed the CIR en banc resolution and dismissed the complaint. The Court found that the closure of the Machine Made Department was not an act of discrimination or a means of dismissal due to union activity but was justified as a result of continued financial losses in its operations. The company’s request for the union to first obtain a certification of majority from the CIR before bargaining was legally proper, especially since the company had an existing collective bargaining agreement with another union. The company’s insistence on individual applications for employment in the new department, after the union’s unconditional offer to work, did not constitute unfair labor practice. Considering all undisputed facts, the petitioners were not guilty of unfair labor practice as charged.