UIC vs. Office of SOLE

MANDATORY PROVISIONS OF THE CBA
University of the Immaculate Concepcion vs. SOLE
I. Facts:
These consolidated cases stem from the labor dispute between petitioner University of the
Immaculate Conception (UIC) and respondent UIC Teaching and Non-Teaching Employees
Union - FFW (the "Union") dating back to 1994.The first consolidated case involves a question
of whether the Secretary has the authority to order the creation of a tripartite committee to
determine the amount of net incremental proceeds of tuition fee increases; the second case
concerns the legality of the dismissal of 12 employees in connection with the labor dispute.
UIC is a non-stock, non-profit educational institution with campuses at Fr. Selga and Bonifacio
Sts., Davao City. Private respondent [the Union] is the certified sole bargaining agent of UIC’s
rank and file employees.
On 20 June 1994, the Union filed a notice of strike on the grounds of bargaining deadlock and
unfair labor practice. On 20 July 1994, the National Conciliation and Mediation Board (NCMB)
called the parties to a conference where they agreed that an increase be granted to the workers in
the amount equivalent to: seventy-five percent (75%) of increment ent on the tuition fee for the
first year, eighty percent (80%) for the second year, and eighty percent (80%) for the third year.
On the same occasion, the UIC demanded the exclusion of secretaries, registrars, accounting
personnel and guidance counselors from the bargaining unit, on account of their being
confidential employees. When the parties agreed to submit this particular issue to voluntary
arbitration, the arbitration panel sustained the UIC on 08 November 1994. The Union’s motion
for reconsideration thereto was denied by the arbitration panel on 08 February 1995.
Accordingly, the UIC gave the affected employees namely: Melanie de la Rosa, Angelina
Abadilla, Jovita Mamburan, Zenaida Canoy, Gemma Galope, Paulina Palma Gil, Lelian Concon,
Mary Ann de Ramos, Alma Villacarlos, [Leah] Cruza, [Ofelia] Diapuez and Josie Boston
[collectively, except Jovita Mamburan, the "Respondent Employees"] the option to choose
between keeping their positions or resigning from the Union. When they elected to keep both
their positions and their union membership, UIC sent them notices of termination on 21 February
1995, which led into a notice of strike filed by the Union on 10 March 1995.
In an Order dated 28 March 1995, the [Secretary] suspended the effects of the said termination
pending the determination of its legality and ordered UIC to reinstate the respondent employees
under the same conditions prevailing prior to the labor dispute. This Order was later modified by
the [Secretary] directing the payroll reinstatement of the respondent employees, instead of
physical reinstatement. On 15 September 1995, the UIC filed a petition for certiorari on the said
payroll reinstatement. The Court of Appeals denied the same in its 08 October 2001 Decision
and 10 January 2002 Resolution. These were affirmed by the Supreme Court on 14 January 2005
[448 SCRA 190].
On 20 June 2006, the [Secretary] issued a Resolution ruling that the respondent employees were
illegally dismissed and directed UIC to reinstate them (except for Jovita Mamburan who died on
18 October 2003) and to pay them backwages and other benefits. UIC’s motion for
reconsideration thereto was denied by the [Secretary] on 18 September 2006.
Meanwhile, on [20 January 1995],2 the Union filed its second notice of strike mostly on the
grounds of bargaining deadlock on the issues of computing the seventy percent (70%)
incremental proceeds and unfair labor practices. On 23 January 1995, the [Secretary] assumed
jurisdiction over the dispute, issued a Return-to-Work Order and enjoined the parties to desist
from all acts which might exacerbate the situation.
On 08 October 1998, the [Secretary] issued an Order directing the parties to execute a collective
bargaining agreement (CBA) embodying all items agreed upon by the parties and the salary
increases consisting of the following: 1st year – 75% of increment increase of tuition fee; 2nd
year – 80% of increment increase of tuition fee; and 3rd year – 80% of increment increase of
tuition fee. The [Secretary] likewise upheld the validity of the strike declared by the Union on 20
January 1995. This Order was challenged by UIC before the Court of Appeals and the Supreme
Court, both of which affirmed the same.
II. Issue: WON the dismissal of the 12 employees was valid based on labor dispute?
III. Ruling: NO
As a preliminary matter, we clarify that the issue of whether or not the Respondent
Employees are confidential employees has long been settled and its reexamination is
already barred by res judicata. In VA Case No. XI-354- 02-94 (the "Arbitration Case"),
the panel of voluntary arbitrators had already determined that the Respondent
Employees are confidential employees who must be excluded from the bargaining unit.
The panel’s decision dated November 8, 1994 43 and resolution of the motion for
reconsideration dated February 8, 1995 44 became final and executory after we
dismissed the Union’s petition for certiorari on June 21, 1995 45 without any further
incidents. The Arbitration Case having attained finality, the issues resolved therein may
no longer be disturbed or modified.
The just causes for terminating an employee, confidential or not, are enumerated in
Article 282 of the Labor Code:
Art. 282. Termination by employer. An employer may terminate an employment for any
of the following causes:
(a) Serious misconduct or willful disobedience by the employee of the lawful orders of
his employer or representative in connection with his work;
(b) Gross and habitual neglect by the employee of his duties;
(c) Fraud or willful breach by the employee of the trust reposed in him by his employer
or duly authorized representative;
(d) Commission of a crime or offense by the employee against the person of his
employer or any immediate member of his family or his duly authorized representatives;
and
(e) Other causes analogous to the foregoing.
UIC cites willful disobedience and "loss of confidence" as the grounds for dismissing the
Respondent Employees. In its termination letters dated February 21, 1995, UIC
informed the Respondent Employees that because of their continued union membership
notwithstanding the voluntary arbitration decision, "management no longer has any trust
and confidence in you in the delicate, sensitive and confidential position you hold."
Generally, employers are given wide latitude in terminating the services of employees
who perform functions which by their nature require the employer's full trust and
confidence. It is well established that an employer cannot be compelled to continue in
employment an employee guilty of acts inimical to the interest of the employer and
justifying loss of confidence in him. It has been held that when an employee has been
guilty of breach of trust or his employer has ample reason to distrust him, a labor
tribunal cannot deny the employer the authority to dismiss him. To constitute a valid
ground for dismissal, it is sufficient that there be some reasonable basis, supported by
substantial evidence, for such loss of confidence.
Nonetheless, employers do not have unbridled authority to dismiss employees by

simply invoking Article 282(c). The loss of confidence must be genuine and cannot be
used as a subterfuge for causes which are illegal, improper and unjust. "Loss of
confidence as a ground for dismissal has never been intended to afford an occasion for
abuse by the employer of its prerogative, as it can easily be subject to abuse because
of its subjective nature.
As in all other contracts, there must be clear indications that the parties reached a meeting of the
minds. In this case, no CBA could be concluded because of what the union perceived as illegal
deductions from the 70% employees' share in the tuition fee increase from which the salary
increases shall be charged. Also, the manner of computing the net incremental proceeds was yet
to be agreed upon by the parties.
Petitioner insisted that a new collective bargaining agreement was concluded through the
conciliation proceeding before the NCMB on all issues specified in the notice of strike. Although
it is true that the university and the union may have reached an agreement on the issues raised
during the collective bargaining negotiations, still no agreement was concluded by them because,
among other reasons, the DOLE Secretary, who assumed jurisdiction on January 23, 1995 only
was set to resolve the distribution of the salary increase of the covered employees. The Court of
Appeals found that "there are many items in the draft-CBA that were not even mentioned in the
minutes of the July 20, 1994 conference."
Considering the parties failed to reach an agreement regarding certain items of the CBA, they
still have the duty to negotiate a new collective bargaining agreement in good faith, pursuant to
the applicable provisions of the Labor Code.

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MANDATORY PROVISIONS OF THE CBA

University of the Immaculate Concepcion vs. SOLE

(b) Gross and habitual neglect by the employee of his duties;

Nonetheless, employers do not have unbridled authority to dismiss employees by

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