G.R. No. 105710 February 23, 1995
JAG & HAGGAR JEANS AND SPORTSWEAR CORPORATION, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION, LAKAS MANGGA-GAWA SA JAG, DOMINGO NAMIA, RIZALDE FLORES, JULIETA ADRIANO, ROBERTO ALAMO, JOSE BALDELOBAR, LILIBETH BIDES, NARCISO GARBIN, AMELITA LEBRIAS, MARIBEL MADRID, VERONICA MAGPILI, IMELDA NEPOMUCENO, AND DAN VILLAMOR, respondents.

FACTS

In September 1988, the Lakas Manggagawa sa Jag (Union), composed of rank-and-file employees of Jag & Haggar Jeans and Sportswear Corporation, staged a strike. Petitioner filed a petition to declare the strike illegal. On November 29, 1988, Labor Arbiter Eduardo Madriaga declared the strike illegal and ordered the dismissal of the officers and members who took part. The NLRC, on appeal, initially set aside this decision and ordered reinstatement. Upon petitioner’s motion for reconsideration, the NLRC modified its decision on May 31, 1990, declaring that certain union officers lost their employment, union board members and shop stewards could be dismissed subject to separation pay, and mere union members were to be reinstated. Pending motions for reconsideration, the parties negotiated a settlement. On October 23, 1990, a Compromise Agreement was executed and signed by petitioner and the Union, represented by its officers. The agreement provided for separation pay and financial assistance for the affected employees, effectively superseding the reinstatement order. Out of 114 affected employees, 90 initially availed of the benefits. Later, 12 more availed, leaving 12 employees (private respondents) who did not sign or avail of the agreement’s benefits. These 12 moved for execution of the NLRC’s May 31, 1990 reinstatement order. The Labor Arbiter denied the motion, but the NLRC set aside this denial and directed petitioner to reinstate the union members with back wages. Petitioner’s motion for reconsideration was denied.

ISSUE

Whether the Compromise Agreement entered into by petitioner and the Union is binding upon the private respondents (the 12 union members who did not sign or avail of its benefits).

RULING

The Compromise Agreement is not binding upon the private respondents who did not sign it or avail of its benefits. The authority of attorneys or union representatives to bind clients in a compromise agreement that discharges a client’s claim requires a special power of attorney or express consent, as per Section 7, Rule IV of the New Rules of Procedure of the NLRC. The waiver of the right to reinstatement is a personal right that must be exercised personally by each worker. The union officers or majority could not waive this accrued right for the dissenting minority members. The NLRC decision ordering reinstatement was more advantageous to the members than dismissal under the compromise. However, respondents Domingo Namia and Rizalde Flores, as union board members, are bound by the NLRC’s amended decision of May 31, 1990, which allowed their dismissal subject to separation pay, as they did not appeal this decision after their motion for reconsideration was denied. The NLRC decision was affirmed with this modification.