G.R. No. 191138 -39; October 19, 2011
Magdala Multipurpose & Livelihood Cooperative and Sanlor Motors Corp., Petitioners, vs. Kilusang Manggagawa ng LGS, Magdala Multipurpose & Livelihood Cooperative (KMLMS) and Union Members/Strikers, Respondents.

FACTS

Respondent Kilusang Manggagawa ng LGS, Magdala Multipurpose and Livelihood Cooperative (KMLMS) is the union operating in petitioners’ companies. KMLMS filed a notice of strike on March 5, 2002, and conducted a strike-vote on April 8, 2002. However, KMLMS only acquired legal personality as an independent labor organization when its registration was granted on April 9, 2002. On May 6, 2002, KMLMS—now a legitimate labor organization—staged a strike. Petitioners filed a Petition to Declare the Strike Illegal before the NLRC, praying that the officers and members who participated in the illegal strike and committed prohibited acts be declared to have lost their employment status. The Labor Arbiter found the strike illegal and declared 41 workers to have forfeited their employment. The NLRC affirmed with modification, declaring an additional seven union members to have lost their employment status. The Court of Appeals affirmed the NLRC Decision in toto. Petitioners now seek a partial modification of the CA Decision by declaring an additional 73 similarly erring KMLMS members to have lost their employment and to award damages and attorney’s fees.

ISSUE

1. Whether the Court of Appeals erred in refusing to similarly declare the rest of the union strikers who participated in the illegal strike and committed prohibited/illegal acts as having lost their employment status.
2. Whether the Court of Appeals erred in refusing to award damages and attorney’s fees as a result of the illegal strike.

RULING

On the First Issue: The Supreme Court held that the May 6, 2002 strike was illegal. When KMLMS filed the notice of strike on March 5, 2002, and conducted the strike-vote on April 8, 2002, it had not yet acquired legal personality and could not legally represent the union and its members. It only acquired legal personality on April 9, 2002. Consequently, the mandatory notice of strike and the conduct of the strike-vote report were ineffective, violating Article 263(c), (d), and (f) of the Labor Code and Rule XXII, Book V of the Omnibus Rules Implementing the Labor Code. The Court found that the CA correctly affirmed the NLRC’s declaration that the identified union officers and members forfeited their employment due to their participation in the illegal strike and commission of prohibited acts. However, the Court modified the CA Decision by declaring an additional 73 union members, who were identified through substantial evidence as having participated in the illegal strike and committed prohibited acts, to have also lost their employment status. The Court emphasized that only those who were positively identified and against whom substantial evidence of participation was presented could be dismissed.
On the Second Issue: The Supreme Court denied the claim for damages and attorney’s fees. The Court ruled that while the strike was illegal, petitioners failed to substantiate their claim for actual damages with clear and convincing evidence. The alleged losses were not adequately proven. Furthermore, attorney’s fees are not recoverable in the absence of a stipulation, law, or evidence of unlawful withholding of wages, and no bad faith was attributed to the respondents in filing the suit.
DISPOSITIVE PORTION: The petition was partly meritorious. The Court affirmed the CA Decision with the modification that an additional 73 union members were declared to have lost their employment status. The claims for damages and attorney’s fees were denied.