G.R. No. 100947 May 31, 1993
PNOC ENERGY DEVELOPMENT CORPORATION and MARCELINO TONGCO, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION and MANUEL S. PINEDA, respondents.

FACTS

Manuel S. Pineda was employed by PNOC Energy Development Corporation (PNOC-EDC), a subsidiary of the Philippine National Oil Company, from September 17, 1981. In November 1987, while holding the position of Geothermal Construction Secretary, he filed a certificate of candidacy for councilor of the Municipality of Kananga, Leyte, in the local elections. The local elections were held on February 1, 1988, and Pineda was proclaimed elected. He took his oath of office in June 1988 and assumed his duties as councilor but continued working for PNOC-EDC. On June 7, 1988, PNOC-EDC’s Legal Department opined that Pineda should be considered ipso facto resigned upon filing his certificate of candidacy, pursuant to Section 66 of the Omnibus Election Code. Despite Pineda’s appeals, including a letter from a Department of Local Government Undersecretary stating there was no legal impediment to his continuing employment, PNOC-EDC terminated his employment on January 26, 1989, citing Section 66. Pineda filed a complaint for illegal dismissal. The Labor Arbiter ruled in his favor, declaring the dismissal illegal and ordering reinstatement with back wages. The National Labor Relations Commission (NLRC) dismissed PNOC-EDC’s appeal. PNOC-EDC then filed this petition for certiorari.

ISSUE

The primary issue is whether Section 66 of the Omnibus Election Code, which considers appointive officials “ipso facto resigned” upon filing a certificate of candidacy, applies to Manuel S. Pineda, an employee of PNOC-EDC, a government-owned or controlled corporation organized under the general corporation law (without an original charter), at the time he filed his candidacy in November 1987.

RULING

The Supreme Court GRANTED the petition, NULLIFIED and SET ASIDE the NLRC decision and resolution, and DISMISSED Pineda’s complaint. The Court held that Section 66 of the Omnibus Election Code applies to officers and employees of government-owned or controlled corporations, regardless of whether they have an original charter or are organized under the general corporation law, and regardless of whether they fall under the Civil Service Law or the Labor Code. The Court reasoned that the constitutional provision (Article IX-B, Section 2(1) of the 1987 Constitution) limiting the civil service to government-owned or controlled corporations “with original charters” governs only civil service coverage and eligibility for civil service exams, but does not affect the application of Section 66 of the Election Code. Section 66 is a specific statutory disqualification for appointive officials and employees seeking elective office, which constitutes a valid ground for termination of employment under the Labor Code. Therefore, Pineda was considered ipso facto resigned from PNOC-EDC upon filing his certificate of candidacy in November 1987, and his subsequent dismissal was valid.