G.R. No. 118463 December 15, 1997
Philippine Airlines, Inc., petitioner, vs. National Labor Relations Commission and Philippine Airlines Employees Association (PALEA), respondents.

FACTS

On February 23, 1979, Philippine Airlines, Inc. (PAL) and the Philippine Airlines Employees Association (PALEA) agreed to extend their expiring Collective Bargaining Agreement (CBA) for another year until September 30, 1980. PAL proposed the extension due to severe financial losses, and PALEA consented after PAL undertook to conduct a Job Evaluation Program (JEP) to establish a new pay scale retroactive to November 1, 1978. A negotiating panel was formed to oversee implementation. PAL subsequently implemented a new pay scale acceptable to PALEA, categorizing employees into supervisory and non-supervisory, with further sub-classifications and job grades.
Subsequently, a series of laws and wage orders increasing the minimum wage and allowances took effect: PD 1614, PD 1713, PD 1751, and Wage Order No. 1. On May 14, 1981, the parties concluded a new CBA for 1980-1983, agreeing to across-the-board pay increases and that “PAL shall revise the present payscale to be effective 1 Oct 1982 and its implementation shall be made after consultation with the union.”
PALEA later complained about the lack of consultation on the revised pay scale. Further wage orders were issued: Wage Order No. 2, Wage Order No. 3, Wage Order No. 4, Wage Order No. 5, and Wage Order No. 6. On September 14, 1984, the parties executed a new CBA granting across-the-board increases and “seniority pay” to preserve wage gaps, which contained a mutual waiver clause.
PALEA filed an unfair labor practice complaint with the NLRC on December 29, 1983, accusing PAL of reneging on its consultation obligation and violating wage orders by failing to cure wage distortions. The case was held in abeyance during CBA negotiations but was later resumed. The Labor Arbiter found that a wage distortion existed and was not cured by the new CBA, and that the waiver clause did not cover the wage distortion issue. The Arbiter directed the parties to discuss and correct the wage distortions. The NLRC affirmed this order. PAL elevated the case to the Supreme Court.

ISSUE

Whether the National Labor Relations Commission committed grave abuse of discretion in affirming the Labor Arbiter’s order directing the parties to convene and discuss the correction of alleged wage distortions.

RULING

The Supreme Court dismissed the petition and affirmed the NLRC resolution. The Court held that the determination of the existence of a wage distortion is a question of fact, and factual findings of quasi-judicial agencies like the NLRC are generally accorded respect and finality. The Court found no grave abuse of discretion in the NLRC’s affirmation of the Labor Arbiter’s order, which directed the parties to discuss and correct the wage distortions. The order was a proper exercise of the NLRC’s authority to implement the correction of wage distortions as mandated by the rules implementing the various wage orders and Article 124 of the Labor Code. The directive for the parties to convene and seek a solution was a reasonable step towards resolving the dispute.