G.R. No.
80774 May 31, 1988
SAN MIGUEL CORPORATION, petitioner,
vs.
NATIONAL LABOR RELATIONS COMMISSION and RUSTICO VEGA, respondents.
FACTS
In line with an Innovation Program sponsored by petitioner San Miguel Corporation
("SMC") and under which management undertook to grant cash awards to "all SMC
employees ... except [ED-HO staff, Division Managers and higher-ranked personnel",
private respondent Rustico Vega submitted an innovation proposal, and supposed to
eliminate certain alleged defects in the quality and taste of the product "San Miguel
Beer Grande:"
Mr. Vega at that time had been in the employ of petitioner Corporation for thirteen (1 3)
years and was then holding the position of "mechanic in the Bottling Department of the
SMC Plant Brewery
Petitioner Corporation did not find the aforequoted proposal acceptable and
consequently refused Mr. Vega's subsequent demands for a cash award under the
Innovation Program.
A Complaint was filed against petitioner Corporation.
o Vega alleged there that his proposal "[had] been accepted and implemented by
the Corporation
Labor Arbiter, noting that the money claim of complainant Vega in this case is "not a
necessary incident of his employment" and that said claim is not among those
mentioned in Article 217 of the Labor Code, dismissed the complaint for lack of
jurisdiction. However, in a gesture of "compassion and to show the government's
concern for the workingman," the Labor Arbiter also directed petitioner to pay Mr. Vega
the sum of P2,000.00 as "financial assistance."
petitioner Corporation seeks to annul the Decision upon the ground that the Labor
Arbiter and the Commission have no jurisdiction over the subject matter of the case
ISSUE: Which tribunal has the exclusive jurisdiction?
RULING:
The jurisdiction of Labor Arbiters and the National Labor Relations Commission is
outlined in Article 217 of the Labor Code, as last amended by Batas Pambansa Blg. 227
which took effect on 1 June 1982
While paragraph 3 refers to "all money claims of workers," it is not necessary to suppose
that the entire universe of money claims that might be asserted by workers against their
employers has been absorbed into the original and exclusive jurisdiction of Labor
Arbiters.
paragraph 3 should be read not in isolation from but rather within the context formed by
paragraph 1 related to unfair labor practices), paragraph 2 (relating to claims concerning
terms and conditions of employment), paragraph 4 (claims relating to household
services, a particular species of employer-employee relations), and paragraph 5 (relating
to certain activities prohibited to employees or to employers).
It is evident that there is a unifying element which runs through paragraphs 1 to 5 and
that is, that they all refer to cases or disputes arising out of or in connection with an
employer-employee relationship.
We reach the above conclusion from an examination of the terms themselves of Article
217, as last amended by B.P. Blg. 227, and even though earlier versions of Article 217
of the Labor Code expressly brought within the jurisdiction of the Labor Arbiters and the
NLRC "cases arising from employer employee relations," 6 which clause was not
expressly carried over in Article 217 as it exists today.
o For it cannot be presumed that money claims of workers which do not arise out
of or in connection with their employer-employee relationship, and which would
therefore fall within the general jurisdiction of the regular courts of justice, were
intended by the legislative authority to be taken away from the jurisdiction of the
courts and lodged with Labor Arbiters on an exclusive basis.
The Court holds that the money claims of workers" referred to in paragraph 3 of Article
217 embraces money claims which arise out of or in connection with the employer-
employee relationship, or some aspect or incident of such relationship. money claims of
workers which now fall within the original and exclusive jurisdiction of Labor Arbiters are
those money claims which have some reasonable causal connection with the employer-
employee relationship
petitioner's Innovation Program is an employee incentive scheme offered and open only
to employees of petitioner Corporation, more specifically to employees below the rank of
manager. Without the existing employer-employee relationship between the parties here,
there would have been no occasion to consider the petitioner's Innovation Program or
the submission by Mr. Vega of his proposal concerning beer grande; without that
relationship, private respondent Vega's suit against petitioner Corporation would never
have arisen. The money claim of private respondent Vega in this case, therefore, arose
out of or in connection with his employment relationship with petitioner
ISSUE: whether the fact that the money claim of private respondent Vega arose out of or in
connection with his employment relation" with petitioner Corporation, is enough to bring such
money claim within the original and exclusive jurisdiction of Labor Arbiters.
RULING:
The Court cited three cases: Molave Motor Sales, Inc. v. Laron, Singapore Airlines
Limited v. Paño and Medina v. Castro-Bartolome. The important principle that runs
through these three (3) cases is that where the claim to the principal relief sought 9 is to
be resolved not by reference to the Labor Code or other labor relations statute or a
collective bargaining agreement but by the general civil law, the jurisdiction over the
dispute belongs to the regular courts of justice and not to the Labor Arbiter and the
NLRC.
In such situations, resolution of the dispute requires expertise, not in labor management
relations nor in wage structures and other terms and conditions of employment, but
rather in the application of the general civil law. Clearly, such claims fall outside the area
of competence or expertise ordinarily ascribed to Labor Arbiters and the NLRC and the
rationale for granting jurisdiction over such claims to these agencies disappears.
the Court notes that the SMC Innovation Program was essentially an invitation from
petitioner Corporation to its employees to submit innovation proposals, and that
petitioner Corporation undertook to grant cash awards to employees who accept such
invitation and whose innovation suggestions, in the judgment of the Corporation's
officials, satisfied the standards and requirements of the Innovation Program 10 and
which could be translated into some substantial benefit to the Corporation. Such
undertaking could nonetheless ripen into an enforceable contractual (facio ut
des) 11 obligation on the part of petitioner Corporation under certain circumstances.
Thus, whether or not an enforceable contract, had arisen between petitioner Corporation
and private respondent Vega in the circumstances of this case, and if so, whether or not
it had been breached, are preeminently legal questions, questions not to be resolved by
referring to labor legislation and having nothing to do with wages or other terms and
conditions of employment, but rather having recourse to our law on contracts.
