G.R. No. L-13282; April 22, 1960
LA CONSOLACION COLLEGE, ET AL., petitioners, vs. COURT OF INDUSTRIAL RELATIONS, ET AL., respondents.

FACTS

La Consolacion College is an educational institution in Bacolod City operated by the Augustinian Sisters, a religious congregation. Its employees were members of the National Employees Workers Security Union (NEWSUN). A complaint for unfair labor practice was filed against the college and its Mother Superior, Sor Evangelista de San Agustin, with the Court of Industrial Relations (CIR). The complaint alleged that around September 1, 1954, the Mother Superior interfered with employees’ right to self-organization by questioning their union activities, leading to their dismissal on December 31, 1954, constituting unfair labor practice under the Industrial Peace Act. The respondents argued that the dismissals were due to a lack of work and that the CIR lacked jurisdiction because the college was a non-profit educational institution, not a business enterprise. The CIR, after hearing, sustained its jurisdiction and ordered the reinstatement of the workers with back pay. The petitioners sought a review via certiorari.
The CIR found the following facts undisputed: The college derived income from student fees, which were used to pay salaries and purchase equipment. It maintained a “free school” for 200 students and provided for 8 working students and 38 “agraciadas” (poor girls given free board, lodging, and clothing in exchange for housework). The involved workers held various jobs (e.g., janitors, gardeners) with salaries ranging from P25 to P80 a month, plus free board and lodging. In May 1954, the laborers joined a union. The Mother Superior, upon receiving union letters proposing better working conditions and naming the laborers, confronted them, stated she knew they were union members, and gave them one month to look for other jobs. The CIR concluded the layoff was due to their union membership and demands for better conditions, constituting unfair labor practice.

ISSUE

Whether the Court of Industrial Relations has jurisdiction over the unfair labor practice case against La Consolacion College, given that it is a non-profit educational institution and not a business enterprise organized for profit.

RULING

The Supreme Court reversed the decision of the Court of Industrial Relations and dismissed the complaint. The Court held that the CIR lacked jurisdiction. Applying the ruling in Boy Scouts of the Philippines vs. Juliana V. Araos (102 Phil., 1080), the Court stated that labor legislation, including the Industrial Peace Act (Republic Act 875), was intended to apply only to employers engaged in industry or occupations for purposes of profit and gain. It does not apply to entities organized, operated, and maintained not for profit but for elevated purposes such as charity, social service, education, and instruction. Since La Consolacion College was found to be a non-profit educational institution run by religious sisters under vows of poverty, with no stockholders or capital, and where fees were spent on salaries and equipment, it did not fall under the jurisdiction of the CIR. Therefore, the complaint for unfair labor practice was dismissed.