G.R. No. L-4507 July 31, 1952
PHILIPPINE MANUFACTURING CO., petitioner, vs. NATIONAL LABOR UNION, respondent.

FACTS

On March 8, 1948, the National Labor Union filed a petition with the Court of Industrial Relations seeking the reinstatement of 27 of its members who were allegedly dismissed by the Philippine Manufacturing Company due to their union activities. After a hearing, the Court of Industrial Relations dismissed the petition on May 4, 1950. Upon motion for reconsideration by the union, the court, on December 5, 1950, issued a resolution ordering the company to pay one month’s salary to the 27 workers and to reinstate Macario Caballero and Tomas Sumaway to their respective positions, with back wages from their dismissal until reinstatement, deducting any wages earned elsewhere during the pendency of the case. Two of the five members of the court dissented regarding the payment of one month’s salary to the 27 workers but concurred with the reinstatement of Caballero and Sumaway. The company’s motion for reconsideration was denied on January 9, 1951, prompting this appeal.

ISSUE

1. Whether the Philippine Manufacturing Company was obligated to retain the 27 workers, who were hired temporarily for a specific reconstruction work, after the completion of such work.
2. Whether the “Agreement for Employment” signed by Tomas Sumaway, which allowed termination without notice, is valid.
3. Whether the quitclaim documents signed by Macario Caballero and Tomas Sumaway upon receipt of separation pay bar their claim for reinstatement.
4. Whether Macario Caballero and Tomas Sumaway were dismissed without just cause.

RULING

The Supreme Court affirmed the appealed resolution.
1. On the termination of the 27 workers: The Court upheld the majority resolution of the Court of Industrial Relations, which found that while the workers were hired temporarily, their employment was not for a specific period. The minority opinion itself revealed that the work was not specific, as 96% of the construction work was finished, and the remaining work was taken over by a third party. Under Article 302 of the Code of Commerce, when employment has no fixed term, either party may terminate it by giving one month’s advance notice, and the employee is entitled to one month’s salary. The 27 workers were therefore entitled to one month’s advance notice or its equivalent pay. This provision, based on principles of humanity and social justice, is constitutionally sanctioned to protect workers and ensure their economic stability.
2. On the validity of the “Agreement for Employment”: The Court declared the agreement void as it contravened Article 302 of the Code of Commerce and the constitutional mandate to protect labor. A worker’s waiver of the right to one month’s advance notice and pay, made under the pressing necessity of hunger and family needs, is not an act of free will and is therefore null. The State intervenes to protect workers who are in a disadvantaged bargaining position.
3. On the effect of the quitclaim documents: The Court ruled that the documents acknowledging receipt of separation pay (P30 as a gift and P75 as vacation pay) signed by Caballero and Sumaway do not bar their claim for reinstatement. They did not sign these documents with complete freedom; if they refused, they would lose the P105 to which they were entitled for vacation pay. Under such circumstances, the documents are no obstacle to their claim for reinstatement.
4. On the dismissal of Caballero and Sumaway: The Court adopted the findings of the Court of Industrial Relations that Macario Caballero and Tomas Sumaway were not construction workers but were assigned to the Purico and Margarine Departments, where there was no lack of work. They were laid off without just cause shortly after their union presented a petition to management. Therefore, they are entitled to reinstatement with back wages as provided by law. All members of the Court of Industrial Relations concurred in their reinstatement.
Costs were awarded against the petitioner.