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University of San Agustin Employees Union vs Court of Appeals Case Digest

This is a case between the University of San Agustin Employees Union-FFW (UNION) and The
University of San Agustin (UNIV).

Sometime on 2000, the parties agreed on a 5-year CBA, the economic provisions of which are
effective for 3 years only. After the lapse of 3 years, the parties negotiated on the economic
provisions but did not agree on the terms during the remaining 2 years of the CBA and beyond.

Since the parties did not agree on the computation of tuition incremental proceeds (TIP) which
shall be the basis for the increase of salaries, they underwent a preventive mediation
proceedings at the NCMB.

Still unresolved, the Union declared a bargaining deadlock and thereafter filed a Notice of Strike
at the NCMB, which was expectedly opposed by the Univ through a Motion to Strike-out Notice
of Strike and Refer the Dispute to Voluntary Arbitration, since the CBA contained a "no-strike,
no-lockout" provision, and a grievance machinery for settling disputes, including a voluntary
arbitration mechanism should the grievance machinery fail to settle the dispute. The NCMB,
however, failed to resolved the Univ's Motion

Thereafter, both parties made a joint request for the Secretary of Labor and Employment
(SOLE) to assume jurisdiction over the dispute.

On September 18, 2003, he SOLE assumed jurisdication, and with such assumption of
jurisdiction, any strike or lockout was strictly enjoined.

The day after the SOLE assumed jurisdiction, and on the same day that the Assumption of
Jurisdiction Order (AJO) was supposedly served to both parties, the Union staged a strike.
Union members refused to receive a copy of the AJO assailing that only the Union President is
authorized to receive the same. The Union filed a Petition Declare Illegal Strike and Loss of
Employment Status of the striking employees, which Petition was filed at the NLRC. Such
Petition was later on consolidated with the case pending before the SOLE, at the request of the
Univ.

The SOLE rendered a Decision resolving the various economic issues over which the parties
had a deadlock in the collective bargaining, and likewise dismissed the Petition to Declare
Illegal Strike.

The University elevated the matter to the Court of Appeals after its Motion for Reconsideration
was denied by the SOLE.

The Court of Appeals partially granted the Petition. It declared the strike as illegal, but affirmed
the SOLE's decision regarding the economic issues.

Both the Univ and the Union filed their respective Motions for Reconsideration.

Basing on the CA's decision, on April 7, 2005, the Univ served the striking employees with their
notices for termination and concurrently, the Union filed with the NCMB a second notice of
strike, this time on ground of alleged union busting.
On April 22, 2005, the parties again took initial steps to negotiate the new CBA but said attempts
proved futile. Hence, on April 25, 2005, the Union went on strike. In reaction, the University
notified the Union that it was pulling out of the negotiations because of the strike.

On August 23, 2005, the CA, acting on the parties' respective motions for reconsideration,
promulgated the herein challenged Partially Amended Decision. Finding merit in the respondent
University's motion for partial reconsideration, the CA ruled that the SOLE abused its discretion
in resolving the economic issues on the ground that said issues were proper subject of the
grievance machinery as embodied in the parties' CBA. Consequently, the CA directed the
parties to refer the economic issues of the CBA to voluntary arbitration. The CA, however, stood
firm in its finding that the strike conducted by the petitioner Union was illegal and its officers
were deemed to have lost their employment status.

Thus, the Union and its dismissed officers file this Petition to the Supreme Court, on the
following issues:

1. Whether or not the strike was illegal and the Union Officers deemed to have lost their
employment status on their failure to return to work immediately upon the service of AJO issued
by the SOLE.
2. Whether or not the economic provisions of the CBA should be referred to Voluntary
Arbitration.
The Supreme Court resolved the foregoing issues as follows:

On the first issue, the SC ruled that ART. 263 of the Labor Code provides: ."..Such assumption
or certification (of the SOLE) shall have the effect of automatically enjoining the intended
or impending strike or lockout as specified in the assumption or certification order. If one
has already taken place at the time of assumption or certification, all striking or locked
out employees shall immediately return to work and the employer shall immediately
resume operations and readmit all workers under the same terms and conditions
prevailing before the strike or lockout." The phrase "immediately return to work" indicates an
almost instantaneous or automatic compliance for a striker to return to work once an AJO has
been duly served. Therefore, the act of the striking employees is violative of the foregoing
provision.

On the second issue, the Supreme Court ruled that economic benefits, which included the issue
on the formula in computing the TIP share of the employees, is one that arises from the
interpretation or implementation of the CBA, and these matters should be referred to a
Voluntary Arbitrator, as provided in Art. 261 and 262 of the Labor Code. The peculiar facts of the
instant case show that the University was deprived of a remedy that would have enjoined the
Union strike and was left without any recourse except to invoke the jurisdiction of the SOLE.

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