Strike Illegality and Termination: When Prior NLRC Findings Suffice

In a significant ruling on labor disputes, the Supreme Court clarified when an employer may validly dismiss workers who commit illegal acts during a strike. The case of Jackbilt Industries, Inc. v. Jackbilt Employees Workers Union-NAFLU-KMU (G.R. Nos. 171618-19, March 13, 2009) resolved a crucial question: must an employer file a separate petition to declare a strike illegal before it can terminate employees who committed illegal acts during that strike?

The Court's answer provides important guidance for both employers and workers navigating the complex rules on strikes and termination.

The Facts of the Case

In 1997, Jackbilt Industries, Inc., a manufacturer of concrete hollow blocks, decided to temporarily stop operations due to the Asian economic crisis. Most employees were placed on leave for six months. The union protested, claiming the shutdown was motivated by anti-union sentiment and designed to avoid the company's duty to bargain collectively.

On March 9, 1998, the union went on strike. Union officers and members picketed the company's main gates and deliberately prevented persons and vehicles from entering or leaving the compound.

The company filed a petition for injunction with the National Labor Relations Commission (NLRC). On April 14, 1998, the NLRC issued a temporary restraining order directing the union to refrain from blocking access to the property. However, reports showed the union violated this order. Union members continued to stop and inspect private vehicles entering and exiting the facility. On July 17, 1998, the NLRC ordered the issuance of a writ of preliminary injunction.

Meanwhile, the company sent memoranda to striking officers and members, requiring them to explain why they should not be dismissed for committing illegal acts during the strike. The union ignored these memoranda. On May 30, 1998, the company dismissed the concerned officers and members.

The Issue

The central question was whether the filing of a petition with the labor arbiter to declare a strike illegal is a condition sine qua non (an indispensable requirement) for the valid termination of employees who commit illegal acts during such strike.

The labor arbiter had ruled that because the company did not file a petition to declare the strike illegal before terminating the employees, it was guilty of illegal dismissal. The Court of Appeals agreed. The company, however, argued that such a petition was unnecessary because the NLRC's July 17, 1998 decision had already found that the union committed illegal acts during the strike.

The Supreme Court's Ruling

The Supreme Court granted the company's petition and upheld the validity of the dismissals.

The Court applied the principle of conclusiveness of judgment, embodied in Section 47(c), Rule 39 of the Rules of Court. This principle holds that parties to a case are bound by the findings in a previous judgment with respect to matters actually raised and adjudged therein.

Article 264(e) of the Labor Code prohibits any person engaged in picketing from obstructing the free ingress to and egress from the employer's premises. Since the NLRC had already found in its July 17, 1998 decision that the union prevented the free entry into and exit of vehicles from the company's compound, the union officers and employees clearly committed illegal acts in the course of the strike.

The Court emphasized that the use of unlawful means in the course of a strike renders such strike illegal. Therefore, pursuant to the principle of conclusiveness of judgment, the March 9, 1998 strike was ipso facto illegal. The filing of a separate petition to declare the strike illegal was thus unnecessary.

Consequently, the Court upheld the legality of the dismissals. Article 264 of the Labor Code provides that an employer may terminate employees found to have committed illegal acts in the course of a strike. The company clearly had the legal right to terminate the union officers and employees.

Practical Takeaways

• Prior findings can suffice. If a prior NLRC decision already establishes that strikers committed illegal acts (such as obstructing ingress to or egress from the employer's premises), a separate petition to declare the strike illegal may no longer be necessary before validly terminating those employees.
• Illegal acts make a strike illegal. The use of unlawful means during a strike—such as blocking access, violence, coercion, or intimidation—renders the strike itself illegal.
• The rule on conclusiveness of judgment applies. Parties are bound by findings in a previous judgment on matters actually raised and adjudged, preventing relitigation of the same issues.
• Employers must still follow due process. The company sent memoranda requiring the employees to explain why they should not be dismissed. Even when termination is justified, procedural due process requirements must be observed.
• Article 264 uses "may." The Labor Code gives the employer the option to terminate a union officer or member who knowingly participated in illegal acts during a strike—it is not mandatory.

This article is general information and not legal advice. For your specific situation, consult a lawyer or ask ASG Legal AI.