G.R. No. L-87672 October 13, 1989
WISE AND CO., INC., petitioner, vs. WISE & CO., INC. EMPLOYEES UNION-NATU AND HONORABLE BIENVENIDO G. LAGUESMA, in his capacity as voluntary Arbitrator, respondents.

FACTS

Petitioner Wise & Co., Inc. introduced a profit-sharing scheme for its managers and supervisors in April 1987. The respondent union, representing rank-and-file employees covered by the existing Collective Bargaining Agreement (CBA), demanded inclusion in this scheme. Petitioner denied the demand, citing adherence to the CBA. During early negotiations for a new CBA, petitioner offered to include union members in the profit-sharing for 1987, provided negotiations concluded by December 1987. However, negotiations deadlocked. Subsequently, on March 30, 1988, petitioner distributed the 1987 profit-sharing benefit not only to managers and supervisors but also to all other rank-and-file employees not covered by the CBA. The union filed a notice of strike, alleging discrimination and unfair labor practice, as its members were excluded. The dispute was submitted to voluntary arbitration, which ruled in favor of the union, ordering the extension of the 1987 profit-sharing benefits to its members.

ISSUE

Whether the grant of profit-sharing benefits exclusively to non-union, non-CBA employees constitutes unlawful discrimination against union members covered by the CBA.

RULING

The Supreme Court ruled in favor of the petitioner, reversing the voluntary arbitrator’s award. The legal logic centers on the principle that discrimination is not per se unlawful when the employees compared are not similarly situated. The CBA in force explicitly defined the bargaining unit, excluding certain regular rank-and-file employees in specific departments (e.g., personnel office, accounting). The profit-sharing benefit was extended precisely to these excluded employees who did not enjoy the comprehensive terms and conditions of the CBA. Union members, in contrast, derived their benefits from the CBA, which constitutes the law between the parties. The Court upheld management’s prerogative to regulate aspects of employment, including the grant of benefits, provided it is exercised in good faith and without malicious intent to circumvent employee rights. The record did not substantiate the union’s claim that the grant was meant to discourage union membership, especially as some non-union employees joined the union even after receiving the benefit. The deadlock in CBA negotiations negated any duty to extend the benefit to union members based on the earlier conditional offer. The Court emphasized it would strike down discriminatory acts but found none under these peculiar circumstances where two distinct employee groups, governed by different compensation frameworks, were treated differently.