G.R. No.
148303 October 17, 2002
UNION OF NESTLE WORKERS CAGAYAN DE ORO FACTORY (UNWCF for brevity),
represented by its President YURI P. BERTULFO and officers, namely,
DEXTER E. AGUSTIN, DANTE S. SEÑAREZ, EDDIE P. OGNIR, JEFFREY C. RELLIQUETE,
ENRIQUITO B. BUAGAS, EDWIN P. SALVAÑA, RAMIL B. MONSANTO, JERRY A. TABILIRAN, ARNOLD A.
TADLAS,
REYQUE A. FACTURA, NAPOLEON S. GALERINA, JR., TOLENTINO T. MICABALO and EDDIE O.
MACASOCOL, petitioners,
vs.
NESTLE PHILPPINES, INC.,
represented by its President JUAN B. SANTOS, RUDY P. TRILLANES, Factory Manager, Cagayan de Oro
City Branch
and FRANCIS L. LACSON, Cagayan de Oro City Human Resources Manager, respondents.
DECISION
SANDOVAL-GUTIERREZ, J.:
Before us is a petition for review on certiorari1 challenging the Decision of the Court of Appeals dated December
28, 2000 and its Resolution dated April 19, 2001 in CA GR-SP No. 56656, "Union of Nestle Workers Cagayan de
Oro Factory, et al. vs. Nestle Philippines, Inc. et al."
On August 1, 1999, Nestle Philippines, Inc. (Nestle) adopted Policy No. HRM 1.8, otherwise known as the "Drug
Abuse Policy." Pursuant to this policy, the management shall conduct simultaneous drug tests on all employees
from different factories and plants. Thus, on August 17, 1999, drug testing commenced at the Lipa City factory,
then followed by the other factories and plants.
However, there was resistance to the policy in the Nestle Cagayan de Oro factory. Out of 496 employees, only
141 or 28.43% submitted themselves to drug testing. On August 20, 1999, the Union of Nestle Workers
Cagayan de Oro Factory and its officers, petitioners, wrote Nestle challenging the implementation of the policy
and branding it as a mere subterfuge to defeat the employees’ constitutional rights. Nestle claimed that the
policy is in keeping with the government’s thrust to eradicate the proliferation of drug abuse, explaining that the
company has the right: (a) to ensure that its employees are of sound physical and mental health and (b) to
terminate the services of an employee who refuses to undergo the drug test.
On August 23, 1999, petitioners filed with the Regional Trial Court (RTC), Branch 40, Cagayan de Oro City, a
complaint for injunction with prayer for the issuance of a temporary restraining order against Nestle, Rudy P.
Trillanes, Factory Manager of the Cagayan de Oro City Branch, and Francis L. Lacson, Cagayan de Oro City
Human Resources Manager (respondents herein), docketed as Civil Case No. 99-471.
On August 24, 1999, the RTC issued a temporary restraining order enjoining respondents from proceeding with
the drug test. Forthwith, they filed a motion to dismiss the complaint on the ground that the RTC has no
jurisdiction over the case as it involves a labor dispute or enforcement of a company personnel policy cognizable
by the Voluntary Arbitrator or Panel of Voluntary Arbitrators. Petitioners filed their opposition, contending that the
RTC has jurisdiction since the complaint raises purely constitutional and legal issues.
On September 8, 1999, the RTC dismissed the complaint for lack of jurisdiction, thus:
"This Court originally is of the honest belief that the issue involved in the instant case is more constitutional than
labor. It was convinced that the dispute involves violation of employees’ constitutional rights to self-incrimination,
due process and security of tenure. Hence, the issuance of the Temporary Restraining Order.
"However, based on the pleadings and pronouncements of the parties, a close scrutiny of the issues would
actually reveal that the main issue boils down to a labor dispute. The company implemented a new drug abuse
policy whereby all its employees should undergo a drug test under pain of penalty for refusal. The employees
who are the union members questioned the implementation alleging that: ‘can they be compelled to undergo the
drug test even against their will, which violates their right against self-incrimination?’ At this point, the issue
seems constitutional. But if we go further and ask the reason for their refusal to undergo the drug test, the
answer is – because the policy was formulated and implemented without proper consultation with the union
members. So that, the issue here boils down to a labor dispute between an employer and employees.
xxxxxxxxx
"Clearly, in the case at bar, the constitutional issue is closely related or intertwined with the labor issue, so much
so that this Court is inclined to believe that it has no jurisdiction but the NLRC."2
Petitioners filed a motion for reconsideration but was denied, prompting them to file with this Court a petition for
certiorari under Rule 65 of the 1997 Rules of Civil Procedure, as amended. They alleged that in dismissing their
complaint for lack of jurisdiction, the RTC gravely abused its discretion.
On November 24, 1999, this Court referred the petition to the Court of Appeals for consideration and
adjudication on the merits or any other action as it may deem appropriate.
On December 28, 2000, the Appellate Court rendered its Decision3 dismissing the petition, thus:
"Settled is the rule that the remedy against a final order is an appeal, and not a petition for certiorari under Rule
65 of the 1997 Rules of Civil Procedure. The party aggrieved does not have the option to substitute the special
civil action of certiorari under Rule 65 for the remedy of appeal. The existence and availability of the right of
appeal are antithetical to the availment of the special civil action of certiorari. And while the special civil action of
certiorari may be resorted to even if the remedy of appeal is available, it must be shown that the appeal is
inadequate, slow, insufficient and will not promptly relieve a party from the injurious effects of the order
complained of, or where the appeal is ineffective.
"Inasmuch as only questions of law are raised by petitioners in assailing the Order of respondent Judge
dismissing their complaint for injunction, the proper remedy, therefore, is appeal to the Supreme Court by
petition for review on certiorari in accordance with Rule 45 of the 1997 Rules of Civil Procedure. Other than the
bare, stereotyped allegation in the petition that there is ‘no appeal, nor any plain, speedy, and adequate remedy
in the ordinary course of law available to the petitioner herein whose right has been violated,’ petitioners have
not justified their resort to Rule 65 of the 1997 Rules of Civil Procedure.
xxxxxxxxx
"It is noteworthy that petitioners have not disputed the allegations in paragraph 28 of private respondents’
Comment on the petition that drug testing of the entire workforce of Nestle Cagayan de Oro factory, including
herein petitioners, submitted themselves to the drug test required by management and was confirmed free from
illegal drug abuse. In view thereof, the instant petition, which prays for an injunction of the drug test of the Nestle
Cagayan de Oro factory workers, had become moot and academic. The remedy of injunction could no longer be
entertained because the act sought to be prevented had been consummated."
Petitioners sought reconsideration but to no avail. Hence this petition for review on certiorari.
Petitioners raise the following issues for our resolution:
I. Whether the Regional Trial Court has jurisdiction over petitioners’ suit for injunction; and
II. Whether petitioners’ resort to certiorari under Rule 65 is in order.
On the first issue, we hold that petitioners’ insistence that the RTC has jurisdiction over their complaint since it
raises constitutional and legal issues is sorely misplaced. The fact that the complaint was denominated as one
for injunction does not necessarily mean that the RTC has jurisdiction. Well-settled is the rule that jurisdiction is
determined by the allegations in the complaint.4
The pertinent allegations of petitioners’ amended complaint read:
"x x x x x x x x x
5. Plaintiffs are aggrieved employees of the Nestle Philippines, Inc. who are subjected to the new policy of the
management for compulsory Drug Test, without their consent and approval;
xxxxxxxxx
8. That the said policy was implemented last August 1, 1999, and the Union was only informed last August 20,
1999, during a meeting held on that day, that all employees who are assigned at the CDO Factory will be
compulsorily compelled to undergo drug test, whether they like it or not, without even informing the Union on this
new policy adopted by the Management and no guidelines was set pertaining to this drug test policy.
9. That there was no consultation made by the management or even consultation from the employees of this
particular policy, as the nature of the policy is punitive in character, as refusal to submit yourself to drug test
would mean suspension from work for four (4) to seven (7) days, for the first refusal to undergo drug test and
dismissal for second refusal to undergo drug test, hence, they were not afforded due process x x x;
xxxxxxxxx
12. That it is not the question of whether or not the person will undergo the drug test but it is the manner how the
drug test policy is being implemented by the management which is arbitrary in character.
xxxxxxxxx
16. That the exercise of management prerogative to implement the said drug test, even against the will of the
employees, is not absolute but subject to the limitation imposed by law x x x;"5
It is indubitable from the foregoing allegations that petitioners are not per se questioning "whether or not the
person will undergo the drug test" or the constitutionality or legality of the Drug Abuse Policy. They are assailing
the manner by which respondents are implementing the policy. According to them, it is "arbitrary in character"
because: (1) the employees were not consulted prior to its implementation; (2) the policy is punitive inasmuch as
an employee who refuses to abide with the policy may be dismissed from the service; and (3) such
implementation is subject to limitations provided by law which were disregarded by the management.
Is the complaint, on the basis of its allegations, cognizable by the RTC?
Respondent Nestle’s Drug Abuse Policy states that "(i)llegal drugs and use of regulated drugs beyond the
medically prescribed limits are prohibited in the workplace. Illegal drug use puts at risk the integrity of Nestle
operations and the safety of our products. It is detrimental to the health, safety and work-performance of
employees and is harmful to the welfare of families and the surrounding community."6 This pronouncement is a
guiding principle adopted by Nestle to safeguard its employees’ welfare and ensure their efficiency and well-
being. To our minds, this is a company personnel policy. In San Miguel Corp. vs. NLRC,7 this Court held:
"Company personnel policies are guiding principles stated in broad, long-range terms that express the
philosophy or beliefs of an organization’s top authority regarding personnel matters. They deal with matter
affecting efficiency and well-being of employees and include, among others, the procedure in the administration
of wages, benefits, promotions, transfer and other personnel movements which are usually not spelled out in the
collective agreement."
Considering that the Drug Abuse Policy is a company personnel policy, it is the Voluntary Arbitrators or Panel of
Voluntary Arbitrators, not the RTC, which exercises jurisdiction over this case. Article 261 of the Labor Code, as
amended, pertinently provides:
Art. 261. Jurisdiction of Voluntary Arbitrators or Panel of Voluntary Arbitrators. – The Voluntary Arbitrator or
panel of Voluntary Arbitrators shall have original and exclusive jurisdiction to hear and decide all unresolved
grievances arising from the interpretation or implementation of the Collective Bargaining Agreement and those
arising from the interpretation or enforcement of company personnel policies x x x." (Emphasis supplied)
With respect to the second issue raised by petitioners, what they should have interposed is an appeal to the
Court of Appeals, not a petition for certiorari which they initially filed with this Court, since the assailed RTC order
is final.8 Certiorari is not a substitute for an appeal.9 For certiorari to prosper, it is not enough that the trial court
committed grave abuse of discretion amounting to lack or excess of jurisdiction, as alleged by petitioners. The
requirement that there is no appeal, nor any plain, speedy and adequate remedy in the ordinary course of law
must likewise be satisfied.10 We must stress that the remedy of appeal was then available to petitioners, but they
did not resort to it. And while this Court in exceptional instances allowed a party’s availment of certiorari instead
of appeal, we find that no such exception exists here.
WHEREFORE, the instant petition for review on certiorari is DENIED. The Decision of the Court of Appeals
dated December 28, 2000 and its Resolution dated April 19, 2001 in CA GR-SP No. 56656 are affirmed.
SO ORDERED.
Puno, (Chairman), Panganiban, Corona, and Carpio Morales, JJ., concur.
Philippines: After 5 years union continues fight against Nestle's illegal
precarious employment practices
Five years after the Union of Nestle Workers Cagayan de Oro Factory (UNCWF) first exposed the
company's use of illegal outsourcing arrangements, the union continues to fight for justice for
casual workers and bring and end to precarious employment practices. While seeing labour only
contracting as a direct threat to union rights, UNWCF is clear that this threat stems from abusive
employment practices and not precarious workers themselves. So in calling for the termination of
the contracts with companies that are producing Nestle products under labour only contracting, the
union is also demanding that the workers exploited under these precarious employment practices
must be granted regular employment.
At the end of June 2006, UNWCF, a member of the IUF-affiliated Council of Filipino Nestle Unions
(CFNU), filed two position papers in the Court of Appeals against an unjust ruling by the National
Labour Relations Commission which ignored extensive evidence presented by the union.
One appeal was filed against the National Labor Relations Commission, Nestle Philippines, ands
COFIPAC Corporation and a second appeal against the National Labor Relations Commission,
Nestle Philippines, FEDCON Construction Corporation and SCF General Manpower Services.
The extensive documentary evidence presented by UNWCF includes a Labour Department
investigation in 2001 which confirmed the union's allegations that Nestle used three companies,
COFIPAC, FEDCON and SCF General Manpower Services, as a source of labour-only contracting
in direct violation of the Labor Code of the Philippines. In fact the 2001 Labour Department
inspection report concluded that: "Regular employee(s) were paid more than what is required
for by law. However, there was a labor-only contracting at the milk & coffee packing line
supplied by FEDCON and SCF General Services, respectively;"
Other crucial evidence ignored by the National Labor Relations Commission in its decision against
the union involves Nestle's own contracts with these companies:
a) a "co-manufacturing" agreement with COFIPAC which clearly demonstrates that COFIPAC did
nothing but provide labour to Nestle, and all aspects of the production process were under the
direct control of Nestle;
b) a "contract for general services" with SFC General Manpower Services from 1 January 1999
until the present not only involves illegal labour only contracting, but is clearly intended to prevent
the regularization of workers and to exclude them from the union and CBA coverage.
The evidence shows that COFIPAC, with total capital of only US$300,000 was not an independent
company that packed Nescafe sachets under contract, but was merely a labour agency. As the
union's lawsuit explains:
"… machineries, tools, premises for refilling, packaging and repackaging are all owned by
respondent NPI [Nestle Philippines Inc] and not by respondent Cofipac."
In addition:
"… respondent NPI [Nestle Philippines Inc] dictated co respondent Cofipac as to how many
employees would be required to the requisitioned job and that the money paid these
employees came from respondent NPI and the only participation of respondent Cofipac is
simply to charge a commission over and above the amounts paid to the workers. Hence,
respondent Cofipac is nothing more than a mere agent of respondent NPI. Respondent
Cofipac simply facilitated the hiring of the employees."
In the case of Nestle's open-ended contract with SFC General Manpower Services, the scope of
services include the following tasks according to piece-rates:
Activity & Rate
a. Receiving: P71.18 (€ 1.08) per metric ton
-scale weighing
-green coffee grading
-green coffee sampling
-sample roasting and splitting
-forklift operation
b. Cleaning and drying: P76.27 (€ 1.16) per metric ton
-coffee tipping
-rebagging
-utility sweeper
-forklift operation
-traffic controller
c. Block piling, re-palletizing, and van stripping/stuffing P25.42 (€ 0.39) per metric ton
d. Sack repair P1.47 (€ 0.02) per sack
e. Sack sorting P0.30 per sack
f. Block piling and palletizing of empty jute sacks P4.88 (€ 0.07) per 100 sacks
This kind of exploitation of casual workers on poverty wages continues until today. As the union's
new appeal against Nestle Philippines and FEDCON clearly states:
"Even at present, of the ten (10) production filling lines for the milk production now in
operation, six (6) of these filling lines are still being manned by contractual workers
provided by respondent FEDCON while only four (4) are being handled by regular
employees belonging to Appellant Union. The four (4) lines are mechanized whilst the six
(6) involved manual filling."
As the union's legal position paper submitted to the Court of Appeals, it explains that the very
reason that labour only contracting is illegal under the Labor Code is "to curb the practice
adopted by unscrupulous employers to avoid regularizing their employees under Article
280 of the same Code."
In addition, Nestle Philippines is guilty of: "… circumventing the law on regular employment
and thus preventing the contractuals from becoming regular employees who would have
otherwise become members of Petitioner UNCWF under the CBA, thus eroding its
bargaining strength and constituting unfair labor practice…."
In other words, by using FEDCON and SFC General Manpower Services to supply workers who
were assigned to the same tasks as regular workers for the past seven years, Nestle Philippines
has excluded these workers from union membership, denying them the benefits and rights
provided in the CBA, and undermined the collective bargaining process itself.
While seeing labour only contracting as a direct threat to union rights, UNWCF is clear that this
threat stems from abusive employment practices and not precarious workers themselves. So in
calling for the termination of the contracts with companies that are producing Nestle products
under labour only contracting, the union is also demanding that the workers exploited under these
precarious employment practices must be granted regular employment:
"The Contracts are asked to be declared null and void. But this does not mean that the
affected employees will be terminated as well. On the other hand, the employees under the
Contracts should be regularized by respondent NPI to retroact to the time that they became
regular employees by operation of law."
NOTE:
Under the Philippines Labor Code Article 106:
"There is labor only contracting where the person supplying workers to an employer does not have
substantial capital or investment in the form of tools, equipment, machineries, work premises,
among others, and the workers recruited and placed by such persons are performing activities
which are directly related to the principal business of such employer. In such cases, the person or
intermediary shall be considered merely as an agent of the employer who shall be responsible to
the workers in the same manner and extent as if the latter were directly employed by him."
Nestle Philippines Inc. vs. Court of Appeals
1991
FACTS:San Miguel Corporation and Nestle S.A. are the two major stockholders of Neslte.Nestle
increased its authorized capital stock and was approved by SEC. Thereafter,some unissued
stocks were sold to San Miguel and Nestle. Nestle filed a complaintwith the SEC, seeking to
exempt the firm from the registration requirement of Section4 of the Revised Securities Act and
from payment of the fee referred to in Section 6(c). The provision states that a corporation may be
exempted from the requirement of registration if its issues additional capital stock among its own
stockholdersexclusively. Nestle argued that issuance of additional capital stock means issuance
of increased authorized capital stock. SEC held that for purposes of granting a general orparticular
exemption from the registration requirements, a request for exemption anda fee equivalent to
0.1% of issued value or securities or stocks are required.
ISSUE:Whether or not Nestle is entitled to exemption.
RULING:Nestle is not exempted from the fee provided for in Section 6 (c) of the RevisedSecurities
Act.Section 6(a) (4) permits greater opportunity for the SEC to implement the statutory objective of
protecting the investing public by requiring proposed issuers of capitalstock to inform such public
of the true financial conditions and prospects of thecorporation. When capital stock is issued in the
course of and in compliance with therequirements of increasing its authorized capital stock under
Section 38 of theCorporation Code, the SEC as a matter of course examines the financial
condition of the corporation. Under the ruling issued by the SEC, an issuance of
previously authorized but still unissued capital stock may, in a particular instance, be held to bean
exempt transaction by the SEC under Section 6(b) so long as the SEC finds thatthe requirements
of registration under the Revised Securities Act are "not necessary inthe public interest and for the
protection of the investors" by reason, inter alia, of thesmall amount of stock that is proposed to be
issued or because the potential buyersare very limited in number and are in a position to protect
themselves. Theconstruction of a statute by the executive officers of the government is entitled to
greatrespect and should be accorded great weight by the courts.
NESTLE VS. CA DIGEST
December 21, 2016 ~ vbdiaz
NESTLE PHILIPPINES, INC., petitioner, vs. COURT OF APPEALS and SECURITIES AND EXCHANGE
COMMISSION, respondents. G.R. No. 86738 November 13, 1991
FACTS:
On February 21, 1983, the Authorized Capital Stock (ACS) of petitioner Nestle was increased from P300 million
divided into 3 million shares with a par value of P100 per share, to P600 million divided into 6 million shares with
a par value of P100 per share. Nestle underwent the necessary procedures involving Board and stockholders
approvals and the necessary filings to secure the approval of the increase of ACS. It was approved by
respondent SEC.
Nestle issued 344,500 shares out of its previously authorized but unissued capital stock exclusively to its
principal stockholders San Miguel Corporation and to Nestle S.A. San Miguel Corporation subscribed to and
completely paid up 168,800 shares, while Nestle S.A. subscribed to and paid up the balance of 175,700 shares
of stock.
In 1985, petitioner Nestle filed a letter to SEC seeking exemption of its proposed issuance of additional shares to
its existing principal shareholders, from the registration requirement of Section 4 of the Revised Securities Act
and from payment of the fee referred to in Section 6(c) of the same Act to wit:
“Sec. 6. Exempt transactions. — a) The requirement of registration under subsection (a) of Section four of this
Act shall not apply to the sale of any security in any of the following transactions: xxx xxx xxx
(4) The distribution by a corporation, actively engaged in the business authorized by its articles of incorporation,
of securities to its stockholders or other security holders as a stock dividend or other distribution out of surplus;
or the issuance of securities to the security holder or other creditors of a corporation in the process of a bona
fide reorganization of such corporation made in good faith and not for the purpose of avoiding the provisions of
this Act, either in exchange for the securities of such security holders or claims of such creditors or partly for
cash and partly in exchange for the securities or claims of such security holders or creditors; or the issuance of
additional capital stock of a corporation sold or distributed by it among its own stockholders exclusively,
where no commission or other remuneration is paid or given directly or indirectly in connection with the sale or
distribution of such increased capital stock.”
Nestle argued that Section 6(a) (4) of the Revised Securities Act embraces “not only an increase in the
authorized capital stock but also the issuance of additional shares to existing stockholders of the unissued
portion of the unissued capital stock“.
SEC denied petitioner’s requests and ruled that the proposed issuance of shares did not fall under Section 6 (a)
(4) of the Revised Securities Act, since Section 6 (a) (4) is applicable only where there is an increase in the
authorized capital stock of a corporation.
MR was denied and appeal to CA was also denied. Thus this Petition for Review.
ISSUE: WON petitioner Nestle’s application for exemptions should be granted.
RULING:
No. Under Sec 38 of the Corporation Code, a corporation engaged in increasing its authorized capital stock, with
the required vote of its Board of Directors and of its stockholders, must file a sworn statement of the treasurer of
the corporation showing that at least 25% of “such increased capital stock” has been subscribed and that at least
25% of the amount subscribed has been paid either in actual cash or in property transferred to the corporation.
The corporation must issue at least 25% of the newly or contemporaneously authorized capital stock in the
course of complying with the requirements of the Corporation Code for increasing its authorized capital stock.
After approval by the SEC of the increase of its authorized capital stock, and from time to time thereafter, the
corporation, by a vote of its Board of Directors, and without need of either stockholder or SEC approval, may
issue and sell shares of its already authorized but still unissued capital stock to existing shareholders or to
members of the general public.
In the case at bar, since the 344,500 shares of Nestle capital stock are proposed to be issued from already
authorized but still unissued capital stock and since the present authorized capital stock of 6,000,000 shares
with a par value of P100.00 per share is not proposed to be further increased, the SEC and the CA correctly
rejected Nestle’s petition.
When capital stock is issued in the course of and in compliance with the requirements of increasing its
authorized capital stock under Section 38 of the Corporation Code, the SEC examines the financial condition of
the corporation, and hence there is no real need for exercise of SEC authority under the Revised Securities Act.
Thus, one of the requirements under the current regulations of the SEC in respect of filing a certificate of
increase of authorized capital stock, is submission of “a financial statement duly certified by an independent
CPA as of the latest date possible or as of the date of the meeting when stockholders approved the
increase/decrease in capital stock or thereabouts. When all or part of the newly authorized capital stock is
proposed to be issued as stock dividends, the SEC requirements are even more exacting; they require, in
addition to the regular audited financial statements, the submission by the corporation of a “detailed or Long
Form Report of the certifying Auditor.” Moreover, since approval of an increase in authorized capital stock by the
stockholders holding 2/3 of the outstanding capital stock is required by Section 38 of the Corporation Code, at a
stockholders meeting held for that purpose, the directors and officers of the corporation may be expected to
inform the shareholders of the financial condition and prospects of the corporation and of the proposed utilization
of the fresh capital sought to be raised.
On the other hand, issuance of previously authorized but theretofore unissued capital stock by the corporation
requires only Board of Directors approval. Neither notice to nor approval by the shareholders or the SEC is
required for such issuance. There would be no opportunity for the SEC to see to it that shareholders (especially
the small stockholders) have a reasonable opportunity to inform themselves about the very fact of such issuance
and about the condition of the corporation and the potential value of the shares of stock being offered.
An issuance of previously authorized but still unissued capital stock may be held to be an exempt transaction by
the SEC under Section 6(b) so long as the SEC finds that the requirements of registration under the Revised
Securities Act are “not necessary in the public interest and for the protection of the investors” by reason, inter
alia, of the small amount of stock that is proposed to be issued or because the potential buyers are very limited
in number and are in a position to protect themselves.
Petitioner Nestle’s second claim for exemption is from payment of the fee provided for in Section 6 (c) of the
Revised Securities Act. Petitioner claims that to require it now to pay one-tenth of one percent (1%) of the issued
value of the 344,500 shares of stock proposed to be issued, is to require it to pay a second time for the same
service on the part of the SEC.
We think it clear that the fee collected in 21 February 1983 by the SEC was assessed in connection with the
examination and approval of the certificate of increase of authorized capital stock then submitted by petitioner.
The fee, on the other hand, provided for in Section 6 (c) which petitioner will be required to pay if it does file an
application for exemption under Section 6 (b), is quite different; this is a fee specifically authorized by the
Revised Securities Act, (not the Corporation Code) in connection with the grant of an exemption from normal
registration requirements imposed by that Act. We do not find such fee either unreasonable or exorbitant.
WHEREFORE, Petition for Review on Certiorari is hereby DENIED for lack of merit.
Nestle Philippines vs NLRC Case Digest
Nestle Philippines, Inc. vs. NLRC and Union of Filipro Employees
193 SCRA 504
Facts: Four (4) collective bargaining agreements separately covering the petitioner's employees in its
Alabang/Cabuyao factories; Makati Administration Office. (Both Alabang/Cabuyao factories and Makati office were
represented by the respondent, Union of Filipro Employees [UFE]);Cagayan de Oro Factory represented by
WATU; and Cebu/Davao Sales Offices represented by the Trade Union of the Philippines and Allied Services
(TUPAS), all expired on June 30, 1987. UFE was certified as the sole and exclusive bargaining agent for all regular
rank-and-file employees at the petitioner's Cagayan de Oro factory, as well as its Cebu/Davao Sales Office.
In August 1987, while the parties, were negotiating, the employees at Cabuyao resorted to a "slowdown" and walk-
outs prompting the petitioner to shut down the factory. Marathon collective bargaining negotiations between the
parties ensued. On September 1987, the UFE declared a bargaining deadlock. On September 8, 1987, the
Secretary of Labor assumed jurisdiction and issued a return to work order. In spite of that order, the union struck,
without notice, at the Alabang/Cabuyao factory, the Makati office and Cagayan de Oro factory on September 11,
1987 up to December 8, 1987. The company retaliated by dismissing the union officers and members of the
negotiating panel who participated in the illegal strike. The NLRC affirmed the dismissals on November 2, 1988.
On January 26, 1988, UFE filed a notice of strike on the same ground of CBA deadlock and unfair labor practices.
However, on March 30, 1988, the company was able to conclude a CBA with the union at the Cebu/Davao Sales
Office, and on August 5, 1988, with the Cagayan de Oro factory workers. The union assailed the validity of those
agreements and filed a case of unfair labor practice against the company on November 16, 1988. After conciliation
efforts of the NCMB yielded negative results, the dispute was certified to the NLRC. The NLRC issued a resolution
on June 5, 1989, whose pertinent disposition regarding the union's demand for liberalization of the company's
retirement plan for its workers. the NLRC issued a resolution denying the motions for reconsideration. With regard
to the Retirement Plan, the NLRC held that Anent management's objection to the modification of its Retirement
Plan, the plan is specifically mentioned in the previous bargaining agreements thereby integrating or incorporating
the provisions thereof to the agreement. By reason of its incorporation, the plan assumes a consensual character
which cannot be terminated or modified at will by either party. Consequently, it becomes part and parcel of CBA
negotiations.
Petitioner alleged that since its retirement plan is non-contributory, Nestle has the sole and exclusive prerogative
to define the terms of the plan because the workers have no vested and demandable rights, the grant thereof
being not a contractual obligation but merely gratuitous. At most the company can only be directed to maintain the
same but not to change its terms. It should be left to the discretion of the company on how to improve or modify
the same.
Issue: Whether or not the workers have vested and demandable rights over the retirement plan.
Ruling: The Court ruled that employees have a vested and demandable right over the retirement plan. The
inclusion of the retirement plan in the collective bargaining agreement as part of the package of economic benefits
extended by the company to its employees to provide them a measure of financial security after they shall have
ceased to be employed in the company, reward their loyalty, boost their morale and efficiency and promote
industrial peace, gives "a consensual character" to the plan so that it may not be terminated or modified at will by
either party.
The fact that the retirement plan is non-contributory, i.e., that the employees contribute nothing to the operation of
the plan, does not make it a non-issue in the CBA negotiations. As a matter of fact, almost all of the benefits that
the petitioner has granted to its employees under the CBA — salary increases, rice allowances, midyear bonuses,
13th and 14th month pay, seniority pay, medical and hospitalization plans, health and dental services, vacation,
sick & other leaves with pay — are non-contributory benefits. Since the retirement plan has been an integral part
of the CBA since 1972, the Union's demand to increase the benefits due the employees under said plan, is a valid
CBA issue.
The petitioner's contention, that employees have no vested or demandable right to a non-contributory retirement
plan, has no merit for employees do have a vested and demandable right over existing benefits voluntarily granted
to them by their employer. The latter may not unilaterally withdraw, eliminate or diminish such benefits.
