Juco Vs NLRC

9/6/2018 Juco vs NLRC : 98107 : August 18, 1997 : J.
Hermosisima, Jr : First Division
FIRST DIVISION
[G.R. No. 98107. August 18, 1997]
BENJAMIN C. JUCO, petitioner, vs. NATIONAL LABOR RELATIONS

COMMISSION and NATIONAL HOUSING CORPORATION, respondents.
DECISION
HERMOSISIMA, JR., J.:
This is a petition for certiorari to set aside the Decision of the National Labor Relations
Commission (NLRC) dated March 14, 1991, which reversed the Decision dated May 21, 1990 of
Labor Arbiter Manuel R. Caday, on the ground of lack of jurisdiction.
Petitioner Benjamin C. Juco was hired as a project engineer of respondent National Housing
Corporation (NHC) from November 16, 1970 to May 14, 1975. On May 14, 1975, he was separated
from the service for having been implicated in a crime of theft and/or malversation of public funds.
On March 25, 1977, petitioner filed a complaint for illegal dismissal against the NHC with the
Department of Labor.
On September 17, 1977, the Labor Arbiter rendered a decision dismissing the complaint on the
ground that the NLRC had no jurisdiction over the case.[1]
Petitioner then elevated the case to the NLRC which rendered a decision on December 28,
1982, reversing the decision of the Labor Arbiter.[2]
Dissatisfied with the decision of the NLRC, respondent NHC appealed before this Court and on
January 17, 1985, we rendered a decision, the dispositive portion thereof reads as follows:
WHEREFORE, the petition is hereby GRANTED. The questioned decision of the respondent National Labor
Relations Commission is SET ASIDE. The decision of the Labor Arbiter dismissing the case before it for
lack of jurisdiction is REINSTATED.[3]
On January 6, 1989, petitioner filed with the Civil Service Commission a complaint for illegal
dismissal, with preliminary mandatory injunction.[4]
On February 6, 1989, respondent NHC moved for the dismissal of the complaint on the ground
that the Civil Service Commission has no jurisdiction over the case.[5]
On April 11, 1989, the Civil Service Commission issued an order dismissing the complaint for
lack of jurisdiction. It ratiocinated that:
The Board finds the comment and/or motion to dismiss meritorious. It was not disputed that NHC is a
government corporation without an original charter but organized/created under the Corporate Code.
Article IX, Section 2 (1) of the 1987 Constitution provides:
The civil service embraces all branches, subdivisions, instrumentalities and agencies of the government,
including government owned and controlled corporations with original charters. (underscoring supplied)
From the aforequoted constitutional provision, it is clear that respondent NHC is not within the scope of the
civil service and is therefore beyond the jurisdiction of this board. Moreover, it is pertinent to state that the
1987 Constitution was ratified and became effective on February 2, 1987.
WHEREFORE, for lack of jurisdiction, the instant complaint is hereby dismissed.[6]

http://sc.judiciary.gov.ph/jurisprudence/1997/aug1997/98107.htm 1/4
9/6/2018 Juco vs NLRC : 98107 : August 18, 1997 : J. Hermosisima, Jr : First Division
On April 28, 1989, petitioner filed with respondent NLRC a complaint for illegal dismissal with
preliminary mandatory injunction against respondent NHC.[7]
On May 21, 1990, respondent NLRC thru Labor Arbiter Manuel R. Caday ruled that petitioner
was illegally dismissed from his employment by respondent as there was evidence in the record
that the criminal case against him was purely fabricated, prompting the trial court to dismiss the
charges against him. Hence, he concluded that the dismissal was illegal as it was devoid of basis,
legal or factual.
He further ruled that the complaint is not barred by prescription considering that the period
from which to reckon the reglementary period of four years should be from the date of the receipt
of the decision of the Civil Service Commission promulgated on April 11, 1989. He also ratiocinated
that:
It appears x x x complainant filed the complaint for illegal dismissal with the Civil Service Commission on
January 6, 1989 and the same was dismissed on April 11, 1989 after which on April 28, 1989, this case was
filed by the complainant. Prior to that, this case was ruled upon by the Supreme Court on January 17, 1985
which enjoined the complainant to go to the Civil Service Commission which in fact, complainant did.
Under the circumstances, there is merit on the contention that the running of the reglementary period of four
(4) years was suspended with the filing of the complaint with the said Commission. Verily, it was not the
fault of the respondent for failing to file the complaint as alleged by the respondent but due to, in the words
of the complainant, a legal knot that has to be untangled.[8]
Thereafter, the Labor Arbiter rendered a decision, the dispositive portion of which reads:
"Premises considered, judgment is hereby rendered declaring the dismissal of the complainant as illegal and
ordering the respondent to immediately reinstate him to his former position without loss of seniority rights
with full back wages inclusive of allowance and to his other benefits or equivalent computed from the time it
is withheld from him when he was dismissed on March 27, 1977, until actually reinstated.[9]
On June 1, 1990, respondent NHC filed its appeal before the NLRC and on March 14, 1991,
the NLRC promulgated a decision which reversed the decision of Labor Arbiter Manuel R. Caday
on the ground of lack of jurisdiction.[10]
The primordial issue that confronts us is whether or not public respondent committed grave
abuse of discretion in holding that petitioner is not governed by the Labor Code.
Under the laws then in force, employees of government-owned and /or controlled corporations
were governed by the Civil Service Law and not by the Labor Code. Hence,
Article 277 of the Labor Code (PD 442) then provided:
"The terms and conditions of employment of all government employees, including employees of
government-owned and controlled corporations shall be governed by the Civil Service Law, rules and
regulations x x x.
The 1973 Constitution, Article II-B, Section 1(1), on the other hand provided:
The Civil Service embraces every branch, agency, subdivision and instrumentality of the government,
including government-owned or controlled corporations.
Although we had earlier ruled in National Housing Corporation v. Juco,[11] that employees of
government-owned and/or controlled corporations, whether created by special law or formed as
subsidiaries under the general Corporation Law, are governed by the Civil Service Law and not by
the Labor Code, this ruling has been supplanted by the 1987 Constitution. Thus, the said
Constitution now provides:
The civil service embraces all branches, subdivision, instrumentalities, and agencies of the Government,
including government owned or controlled corporations with original charter. (Article IX-B, Section 2[1])
In National Service Corporation (NASECO) v. National Labor Relations Commission,[12] we

had the occasion to apply the present Constitution in deciding whether or not the employees of
NASECO are covered by the Civil Service Law or the Labor Code notwithstanding that the case
arose at the time when the 1973 Constitution was still in effect. We ruled that the NLRC has
jurisdiction over the employees of NASECO on the ground that it is the 1987 Constitution that
governs because it is the Constitution in place at the time of the decision. Furthermore, we ruled
that the new phrase with original charter means that government-owned and controlled
corporations refer to corporations chartered by special law as distinguished from corporations
organized under the Corporation Code. Thus, NASECO which had been organized under the
general incorporation stature and a subsidiary of the National Investment Development
Corporation, which in turn was a subsidiary of the Philippine National Bank, is excluded from the
purview of the Civil Service Commission.
We see no cogent reason to depart from the ruling in the aforesaid case.
In the case at bench, the National Housing Corporation is a government owned corporation
organized in 1959 in accordance with Executive Order No. 399, otherwise known as the Uniform
Charter of Government Corporation, dated January 1, 1959. Its shares of stock are and have been
one hundred percent (100%) owned by the Government from its incorporation under Act 1459, the
former corporation law. The government entities that own its shares of stock are the Government
Service Insurance System, the Social Security System, the Development Bank of the Philippines,
the National Investment and Development Corporation and the Peoples Homesite and Housing
Corporation.[13] Considering the fact that the NHA had been incorporated under act 1459, the
former corporation law, it is but correct to say that it is a government-owned or controlled
corporation whose employees are subject to the provisions of the Labor Code. This observation is
reiterated in recent case of Trade Union of the Philippines and Allied Services (TUPAS) v. National
Housing Corporation,[14] where we held that the NHA is now within the jurisdiction of the
Department of Labor and Employment, it being a government-owned and/or controlled corporation
without an original charter. Furthermore, we also held that the workers or employees of the NHC
(now NHA) undoubtedly have the right to form unions or employees organization and that there is
no impediment to the holding of a certification election among them as they are covered by the
Labor Code.
Thus, the NLRC erred in dismissing petitioners complaint for lack of jurisdiction because the
rule now is that the Civil Service now covers only government-owned or controlled corporations
with original charters.[15] Having been incorporated under the Corporation Law, its relations with its
personnel are governed by the Labor Code and come under the jurisdiction of the National Labor
Relations Commission.
One final point. Petitioners have been tossed from one forum to another for a simple illegal
dismissal case. It is but apt that we put an end to his dilemma in the interest of justice.
WHEREFORE, the decision of the NLRC in NLRC NCR-04-02036089 dated March 14, 1991 is
hereby REVERSED and the Decision of the Labor Arbiter dated May 21, 1990 is REINSTATED.
SO ORDERED.
Padilla, (Chairman), Bellosillo, Vitug, and Kapunan, JJ., concur.
[1] Rollo, pp. 20-21.

[2] Id., pp. 22-26.
[3] Id., pp. 27-37.
[4] Id., pp. 38-42.
[5] Id., pp. 43-47.
[6] Id., p. 52.
[7] Id., pp. 53-58.
[8] Id., p. 68.
[9] Id., p. 69.
[10] Id., pp. 78-86.
[11] 134 SCRA 172 (1985).
[12] 168 SCRA 122 [1988].
[13] National Housing Corporation vs. Juco, 134 SCRA 172 (1985).
[14] 173 SCRA 33 (1989).
[15] PNOC-Energy Development Corporation v. NLRC, 201 SCRA 487 1991 The NHC (now NHA)

Juco Vs NLRC

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9/6/2018 Juco vs NLRC : 98107 : August 18, 1997 : J.

Hermosisima, Jr : First Division

[G.R. No. 98107. August 18, 1997]

BENJAMIN C. JUCO, petitioner, vs. NATIONAL LABOR RELATIONS

Article IX, Section 2 (1) of the 1987 Constitution provides:

WHEREFORE, for lack of jurisdiction, the instant complaint is hereby dismissed.[6]

In National Service Corporation (NASECO) v. National Labor Relations Commission,[12] we

[1] Rollo, pp. 20-21.

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