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Collective Bargaining
PHASE 1: Negotiation Phase
PHASE 2: Administration Phase
PHASE 3: Re-negotiation Phase
G.R. No. L-20303 September 27, 1967
REPUBLIC SAVINGS BANK (now REPUBLIC
BANK), petitioner,
vs.
COURT OF INDUSTRIAL RELATIONS, ROSENDO T.
RESUELLO, BENJAMIN JARA, FLORENCIO ALLASAS,
DOMINGO B. JOLA, DIOSDADO S. MENDIOLA,
TEODORO DE LA CRUZ, NARCISO MACARAEG and
MAURO A. ROVILLOS, respondents.
Lichauco, Picaso & Agcaoili and R. Santayana for petitioner.
G. E. Fajardo for respondents.
CASTRO, J.:
The vital issue in this case is whether the dismissal of the eight (8)
respondent employees by the petitioner Republic Bank
(hereinafter referred to as the Bank) constituted an unfair labor
practice within the meaning and intendment of the Industrial
Peace Act (Republic Act 875). The Court of Industrial Relations
(CIR) found it did and its decision is now on appeal before us. The
Bank maintains that the discharge was for cause.
The Bank had in its employ the respondents Rosendo T. Resuello,
Benjamin Jara, Florencio Allasas, Domingo B. Jola, Diosdado S.
Mendiola, Teodoro de la Cruz, Narciso Macaraeg and Mauro A.
Rovillos. On July 12, 1958 it discharged Jola and, a few days after
(July 18, 1958), the rest of respondents, for having written and
published "a patently libelous letter . . . tending to cause the
dishonor, discredit or contempt not only of officers and employees
of this bank, but also of your employer, the bank itself."
The letter referred to was a letter-charge which the respondents
had written to the bank president, demanding his resignation on
the grounds of immorality, nepotism in the appointment and
favoritism as well as discrimination in the promotion of bank
employees. The letter, dated July 9, 1958, is hereunder reproduced
in full:
Mr. Ramon Racelis
President, Republic Savings Bank
M a n i l a
"Dear Mr. President:
We, the undersigned, on behalf of all our members and
employees of the Republic Savings Bank, who have in our
hearts only the most honest and sincere motive to
conserve and protect the interest of the institution and its
200,000 depositors, do hereby, demand the much
needed resignation of His Excellency, Mr. Ramon Racelis
as President and Member of the Board of Directors of the
Bank.
Mr. President, you have already, in so many occasions,
placed the Bank on the verge of danger, that now we
deem it right and justifiable for you to leave this Bank
and let other more capable presidents continue the work
you have not well accomplished.
In the above instance, we are presenting charges which in
our humble contention properly justifies incapacity on
your part to continue and assume the position as top
executive of the huge institution:
(1) That you Mr. President, have tolerated and
practiced immorality in this Bank. We have been
expecting you to do something about this
malpractice which is very disgraceful and affects
the morale of the hundreds of your employees.
But so far, Mr. President, you have just let this
thing passed through. As a matter of fact, you
have even promoted these women like Misses
Pacita Mato and Edita Castro. These women are
of questionable characters, Mr. President, and
should have had no place in the Bank as
managers or even as mere employees. We know
Mr. President, because it is an open secret in the
Bank, that you have illicit relations with one of
them Miss Edita Castro. As top officer and as
father of the employees of the Bank, you have
shown this bad example to your employees. Mr.
President, we are really ashamed of you.
(2) That you have allowed the practice of
nepotism in this Bank. You have employed
relatives of yours like Honorio Ravida;
Bienvenido Ravida; Antonio Racelis; Jesus
Antonio; and Argentina Racelis. Not only that
Mr. President. You have also given those nieces
and nephews of yours good positions at the
expense of the more capable employees. Mr.
President, if we have to mention all of them, one
page will not be enough.
(3) With regards to promotion, you have given
more preferences to your close relatives. When
the Bank advocated the sending of pensionados
to States, you have only limited your choice
among your nieces, nephews, and querida,
namely, Miss Argentina Racelis, Mr. Jesus
Antonio, Miss Edita Castro, and her brother-in-
law, Mr. Pedro Garcia, Jr. In doing this, Mr.
President, you have only lowered the reputation
and standing of the Republic Savings Bank.
There is really no sense in sending high school
and B.S.E. graduates to States to study advanced
banking. Because of this silly decision, it took
one pensionado six months and cost the Bank a
total of P10,000.00 just to study Christmas
savings. That subject is very simple; one need
not go to States to study savings; that you know
full well, Mr. President. The reason why you sent
Miss Castro to States was because you were also
there. Are we not right?
(4) That you Mr. President, tolerated and still
tolerating grave dishonesty in this Bank as
evidenced by the following irregularities and
anomalies;
(a) In one of our branches, around
P200,000.00 was mulcted and
embezzled by a certain Maximo
Donado by doctoring the ledgers and
records of that particular office. To the
present, the amount is still increasing
and some more are being dug up from
the records everyday ever since its
discovery in February 1957. In this case
you dismissed Mr. M. Donado,
immediately. But this was all that you
did. If you have to go back to the
history of the case, you will find out
that your beloved nieces and nephews
are also involved having been
managers of that particular office.
Another nephew, the Vice President-
Operations, then Vice President,
Personnel, was also involved for valid
reasons that he did not even shift this
particular employee to other branches
or departments since the beginning
when it has been the policy of the Bank
to reshuffle its personnel. If you want
to know why your good nephew did not
transfer this employee, we will tell you.
"Your good nephew has eaten too many
baskets of delicious alimango." Mr.
President, if there is someone to be
blamed in this particular case, it is your
good nephews and nieces for their
gross negligence.
(b) Aside from the one mentioned
above, we have also Mr. Rodolfo
Francisco, who in April 1955,
maliciously withdraw (sic) P970.00 in
two withdrawal slips from the account
of one depositor in one of our
provincial offices, inserting his name as
co-depositor in the savings account
ledger.
(c) In January 1958, Mr. Jose de los
Santos expended and approved
representation expense in the amount
of P300.00 in one of our provincial
offices.
(d) Mr. Federico M. Dabu, the ex-
cashier and now Personnel Manager,
incurred a shortage in the amount of
P1,240.00 in the course of the audit on
August 3, 1954.

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(e) Mr. Jose S. Guevara, Vice-President
on Personnel have (sic) been accepting
bribe moneys. One of these amounts to
P4,000.00 which was delivered by a
messenger sometime during the last
quarter of 1957.
Mr. President, the anomalies are only a partial list of the
irregularities which so far you have not acted upon. This
type of people should have been fired out from the Bank;
yet on the contrary, you promoted them to higher and
responsible positions, thus, resulting in the
demoralization of the more capable employees.
Mr. President, we hope that you have still a little sense of
decency and propriety left. So, for goodsake and for the
welfare of the Bank, DO RESIGN NOW as President and
as Member of the Board of Directors of the Republic
Savings Bank.
Very respectfully yours,
(Sgd.) Rosendo T. Resuello
President, RSB Supervisors' Union (FFW),
(Sgd.) Benjamin Jara
Vice-President RSB Supervisors' Union
(FFW)
(Sgd.) Florencio Allasas
Treasurer, RSB Supervisors' Union (FFW)
(Sdg) Domingo B. Jola
Chairman, Executive Committee, RSB
Employees' Union (FFW)
(Sgd.) Diosdado S. Mendiola
Vice-President, RSB Employees Union
(FFW)
(Sgd.) Teodoro de la Cruz
Member, Executive Committee, RSB
Employees' Union (FFW)
(Sgd.) Angelino Quiambao
President, RSB Security Guard Union (FFW)
(Sgd.) Narciso Macaraeg
Vice-President, RSB Security Guard Union
(FFW)
(Sgd.) Alfredo Bautista
Treasurer, RSB Security Guard Union (FFW)
(Sgd.) Pacifico A. Argao
PRO, RSB Employees' Union (FFW)
(Sgd.) Toribio B. Garcia
Secretary, RSB Security Guard Union (FFW)
(Sgd.) Mauro A. Rovillos
Member, Executive Committee, RSB
Supervisors' Union (FFW)
Copies of this letter were admittedly given to the chairman of the
board of directors of the Bank, and the Governor of the Central
Bank.
At the instance of the respondents, prosecutor A. Tirona filed a
complaint in the CIR on September 15, 1958, alleging that the
Bank's conduct violated section 4(a) (5) of the Industrial Peace Act
which makes it an unfair labor practice for an employer "to
dismiss, discharge or otherwise prejudice or discriminate against
an employee for having filed charges or for having given or being
about to give testimony under this Act."
The Bank moved for the dismissal of the complaint, contending
that respondents were discharged not for union activities but for
having written and published a libelous letter against the bank
president. The court denied the motion on the basis of its decision
in another case
1
in which it ruled that section 4(a) (5) applies to
cases in which an employee is dismissed or discriminated against
for having filed "any charges against his employer." Whereupon
the case was heard.
In 1960, however, this Court overruled the decision of the CIR in
the Royal Interocean case and held that "the charge, the filing of
which is the cause of the dismissal of the employee, must be
related to his right to self-organization in order to give rise to
unfair labor practice on the part of the employer," because "under
subsection 5 of section 4(a), the employee's (1) having filed
charges or (2) having given testimony or (3) being about to give
testimony, are modified by 'under this Act' appearing after the last
item."
2
The Bank therefore renewed its motion to dismiss, but the
court held the motion in abeyance and proceeded with the hearing.
On July 4, 1962 the court rendered a decision finding the Bank
guilty of unfair labor practice and ordering it to reinstate the
respondents, with full back wages and without loss of seniority and
other privileges. This decision was affirmed by the court en
banc on August 9, 1962.
Relying upon Royal Interocean Lines v. CIR,
3
and Lakas ng
Pagkakaisa sa Peter Paul v. CIR,
4
the Bank argues that the court
should have dismissed the complaint because the discharge of the
respondents had nothing to do with their union activities as the
latter in fact admitted at the hearing that the writing of the letter-
charge was not a "union action" but merely their "individual" act.
It will avail the Bank none to gloat over this admission of the
respondents. Assuming that the latter acted in their individual
capacities when they wrote the letter-charge they were nonetheless
protected for they were engaged in concerted activity, in the
exercise of their right of self-organization that includes concerted
activity for mutual aid and protection,
5
interference with which
constitutes an unfair labor practice under section 4(a)(1). This is
the view of some members of this Court. For, as has been aptly
stated, the joining in protests or demands, even by a small group
of employees, if in furtherance of their interests as such, is a
concerted activity protected by the Industrial Peace Act. It is not
necessary that union activity be involved or that collective
bargaining be contemplated.
6
Indeed, when the respondents complained against nepotism,
favoritism and other management practices, they were acting
within an area marked out by the Act as a proper sphere of
collective bargaining. Even the reference to immorality was not
irrelevant as it was made to support the respondents' other charge
that the bank president had failed to provide wholesome working
conditions, let alone a good moral example, for the employees by
practicing discrimination and favoritism in the appointment and
promotion of certain employees on the basis of illicit relations or
blood relationship with them.
In many respects, the case at bar is similar to National Labor
Relations Board v. Phoenix Mutual Life Insurance Co.
7
The issue
in that case was whether an insurance company was guilty of an
unfair labor practice in interfering with this right of concerted
activity by discharging two agents employed in a branch office. The
cashier of that office had resigned. The ten agents employed there
held a meeting and agreed to join in a letter to the home office
objecting to the transfer to their branch office of a cashier from
another branch office to fill the position. They discussed also the
question whether to recommend the promotion of the assistant
cashier of their office as the proper alternative. They then chose
one of their number to compose a draft of the letter and submit it
to them for further discussion, approval and signature. The agent
selected to write the letter and another were discharged for their
activities in this respect as being, so their notices stated,
completely unpleasant and far beyond the periphery of their
responsibility. In holding the company liable for unfair labor
practice, the Circuit Court of Appeals said:
A proper construction is that the employees shall have
the right to engage in concerted activities for their mutual
aid or protection even though no union activity be
involved, for collective bargaining be contemplated. Here
Davis and Johnson and other salesmen were properly
concerned with the identity and capability of the new
cashier. Conceding they had no authority to appoint a
new cashier or even recommend anyone for the
appointment, they had a legitimate interest in acting
concertedly in making known their views to management
without being discharged for that interest. The moderate
conduct of Davis and Johnson and the others bore a
reasonable relation to conditions of their employment. It
was therefore an unfair labor practice for respondent to
interfere with the exercise of the right of Davis and
Johnson and the other salesmen to engage in concerted
activities for their mutual aid or protection.
Other members of this Court agreed with the CIR that the Bank's
conduct violated section 4(a) (5) which makes it an unfair labor
practice for an employer to dismiss an employee for having filed
charges under the Act.
Some other members of this Court believe, without necessarily
expressing approval of the way the respondents expressed their
grievances, that what the Bank should have done was to refer the
letter-charge to the grievance committee. This was its duty, failing
which it committed an unfair labor practice under section 4(a) (6).
For collective bargaining does not end with the execution of an
agreement. It is a continuous process. The duty to bargain imposes
on the parties during the term of their agreement the mutual
obligation "to meet and confer promptly and expeditiously and in
good faith . . . for the purpose of adjusting any grievances or
question arising under such agreement"
8
and a violation of this
obligation is, by section 4 (a) (6) and (b) (3) an unfair labor
practice.
9
As Professors Cox and Dunlop point out:
Collective bargaining . . . normally takes the form of
negotiations when major conditions of employment to be
written into an agreement are under consideration and of
grievance committee meetings and arbitration when
questions arising in the administration of an agreement
are at stake.
10

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Unformatted Attachment Preview
 Collective Bargaining PHASE 1: Negotiation Phase PHASE 2: Administration Phase PHASE 3: Re-negotiation Phase G.R. No. L-20303             September 27, 1967 REPUBLIC SAVINGS BANK (now REPUBLIC BANK), petitioner,  vs. COURT OF INDUSTRIAL RELATIONS, ROSENDO T. RESUELLO, BENJAMIN JARA, FLORENCIO ALLASAS, DOMINGO B. JOLA, DIOSDADO S. MENDIOLA, TEODORO DE LA CRUZ, NARCISO MACARAEG and MAURO A. ROVILLOS, respondents. Lichauco, Picaso & Agcaoili and R. Santayana for petitioner. G. E. Fajardo for respondents.   CASTRO, J.: The vital issue in this case is whether the dismissal of the eight (8) respondent employees by the petitioner Republic Bank (hereinafter referred to as the Bank) constituted an unfair labor practice within the meaning and intendment of the Industrial Peace Act (Republic Act 875). The Court of Industrial Relations (CIR) found it did and its decision is now on appeal before us. The Bank maintains that the discharge was for cause. The Bank had in its employ the respondents Rosendo T. Resuello, Benjamin Jara, Florencio Allasas, Domingo B. Jola, Diosdado S. Mendiola, Teodoro de la Cruz, Narciso Macaraeg and Mauro A. Rovillos. On July 12, 1958 it discharged Jola and, a few days after (July 18, 1958), the rest of respondents, for having written and published "a patently libelous letter . . . tending to cause the dishonor, discredit or contempt not only of officers and employees of this bank, but also of your employer, the bank itself." The letter referred ...
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