G.R. No.

120567, March 20, 1998 The petition for injunction directly filed
Philippine Airlines, Inc. before the NLRC is in reality an action for illegal
vs. dismissal. Thus, the NLRC exceeded its jurisdiction
NLRC when it issued the assailed Order granting private
respondents' petition for injunction and ordering the
Facts: petitioner to reinstate private respondents.
Private respondents are flight stewards of
PAL who were dismissed from the service for their
alleged involvement in the currency smuggling in
Hong Kong.
Aggrieved by the said dismissal, private
respondents filed with the NLRC a petition for
injunction. The NLRC issued a temporary
mandatory injunction enjoining petitioner to cease
and desist from enforcing its Memorandum of
dismissal.
In support of the issuance of the writ of
temporary injunction, the NLRC adopted the view
that:
(1) private respondents cannot be validly dismissed
on the strength of petitioner's Code of Discipline
which was declared illegal by this Court for the
reason that it was formulated by the petitioner
without the participation of its employees
(2) the whimsical, baseless and premature
dismissals of private respondents which "caused
them grave and irreparable injury" is enjoinable as
private respondents are left "with no speedy and
adequate remedy at law' except the issuance of a
temporary mandatory injunction

PAL moved for reconsideration arguing that

the NLRC erred in granting a temporary injunction
order when it has no jurisdiction to issue an
injunction or restraining order since this may be
issued only under Article 218 of the Labor Code if
the case involves or arises from labor disputes.

Issue:
Whether or not the grant of injunction was
proper.

Ruling:
No.
It is an essential requirement that there
must first be a labor dispute between the
contending parties before the labor arbiter.
In the present case, there is no labor
dispute between the petitioner and private
respondents as there has yet been no complaint for
illegal dismissal filed with the labor arbiter by the
private respondents against the petitioner.
 Republic of the Philippines ordering respondent to reinstate
SUPREME COURT petitioners to their former positions
Manila pending the hearing of this case, or,
prohibiting respondent from enforcing
SECOND DIVISION its Decision dated February 22, 1995
while this case is pending
  adjudication;

G.R. No. 120567 March 20, 1998 III. After hearing, that the writ of
preliminary injunction as to the reliefs
sought for be made permanent, that
PHILIPPINE AIRLINES, INC., petitioner,
petitioners be awarded full
vs.
backwages, moral damages of PHP
NATIONAL LABOR RELATIONS COMMISSION,
500,000.00 each and exemplary
FERDINAND PINEDA and GOGFREDO
damages of PHP 500,000.00 each,
CABLING, respondents.
attorney's fees equivalent to ten
percent of whatever amount is
awarded, and the costs of suit.

MARTINEZ, J.: On April 3, 1995, the NLRC issued a temporary

mandatory injunction   enjoining petitioner to cease
2

Can the National Labor Relations Commission and desist from enforcing its February 22, 1995
(NLRC), even without a complaint for illegal dismissal Memorandum of dismissal. In granting the writ, the
tiled before the labor arbiter, entertain an action for NLRC considered the following facts, to wit:
injunction and issue such writ enjoining petitioner
Philippine Airlines, inc. from enforcing its Orders of . . . that almost two (2) years ago, i.e.
dismissal against private respondents, and ordering on April 15, 1993, the petitioners were
petitioner to reinstate the private respondents to their instructed to attend an investigation by
previous positions? respondent's "Security and Fraud
Prevention Sub-Department"
This is the pivotal issue presented before us in this regarding an April 3, 1993 incident in
petition for certiorari under Rule 65 of the Revised Hongkong at which Joseph Abaca,
Rules of Court which seeks the nullification of the respondent's Avionics Mechanic in
injunctive writ dated April 3, 1995 issued by the NLRC Hongkong "was intercepted by the
and the Order denying petitioner's motion for Hongkong Airport Police at Gate
reconsideration on the ground that the said Orders 05 . . . the ramp area of the Kai Tak
were issued in excess of jurisdiction. International Airport while . . . about to
exit said gate carrying a . . . bag said
Private respondents are flight stewards of the to contain some 2.5 million pesos in
petitioner. Both were dismissed from the service for Philippine Currencies. That at the
their alleged involvement in the April 3, 1993 currency Police Station. Mr. Abaca claimed that
smuggling in Hong Kong. he just found said plastic bag at the
Skybed Section of the arrival flight
Aggrieved by said dismissal, private respondents filed PR300/03 April 93," where petitioners
with the NLRC a petition  for injunction praying that:
1 served as flight stewards of said flight
PR300; . . the petitioners sought "a
I. Upon filing of this Petition, a more detailed account of what this
temporary restraining order be issued, HKG incident is all about"; but instead,
prohibiting respondents (petitioner the petitioners were administratively
herein) from effecting or enforcing the charged, "a hearing" on which "did
Decision dated Feb. 22, 1995, or to not push through" until almost two (2)
reinstate petitioners temporarily while years after, i.e, "on January 20, 1995 .
a hearing on the propriety of the . . where a confrontation between Mr.
issuance of a writ of preliminary Abaca and petitioners herein was
injunction is being undertaken; compulsorily arranged by the
respondent's disciplinary board" at
II. After hearing, a writ of preliminary which hearing, Abaca was made to
mandatory injunction be issued identify petitioners as co-conspirators;
that despite the fact that the procedure
 of identification adopted by respondents cannot be validly dismissed on the
respondent's Disciplinary Board was strength of petitioner's Code of Discipline which was
anomalous "as there was no one else declared illegal by this Court in the ease at PAL,
in the line-up (which could not be Inc. vs. NLRC, (G.R. No. 85985), promulgated August
called one) but petitioners . . . Joseph 13, 1993, for the reason that it was formulated by the
Abaca still had difficulty in identifying petitioner without the participation of its employees as
petitioner Pineda as his co- required in R.A. 6715, amending Article 211 of the
conspirator, and as to petitioner Labor Code; (2) the whimsical, baseless and
Cabling, he was implicated and premature dismissals of private respondents which
pointed by Abaca only after "caused them grave and irreparable injury" is
respondent's Atty. Cabatuando enjoinable as private respondents are left "with no
pressed the former to identify speedy and adequate remedy at law" except the
petitioner Cabling as co-conspirator"; issuance of a temporary mandatory injunction; (3) the
that with the hearing reset to January NLRC is empowered under Article 218 (e) of the
25, 1995, "Mr. Joseph Abaca finally Labor Code not only to restrain any actual or
gave exculpating statements to the threatened commission of any or all prohibited or
board in that he cleared petitioners unlawful acts but also to require the performance of a
from any participation or from being particular act in any labor dispute, which, if not
the owners of the currencies, and at restrained or performed forthwith, may cause grave or
which hearing Mr. Joseph Abaca irreparable damage to any party; and (4) the
volunteered the information that the temporary power of the NLRC was recognized by this
real owner of said money was one Court in the case of Chemo-Technische Mfg.,
who frequented his headquarters in Inc. Employees Union, DFA, et. al. vs. Chemo-
Hongkong to which information, the Technische Mfg., Inc. [G.R. No. 107031, January 25,
Disciplinary Board Chairman, Mr. 1993].
Ismael Khan," opined "for the need for
another hearing to go to the bottom of On May 4, 1995, petitioner moved for
the incident"; that from said statement, reconsideration  arguing that the NLRC erred:
3

it appeared "that Mr. Joseph Abaca

was the courier, and had another 1. . . . in granting a
mechanic in Manila who hid the temporary injunction
currency at the plane's skybed for order when it has no
Abaca to retrieve in Hongkong, which jurisdiction to issue an
findings of how the money was found injunction or
was previously confirmed by Mr. restraining order since
Joseph Abaca himself when he was this may be issued
first investigated by the Hongkong only under Article 218
authorities"; that just as petitioners of the Labor Code if
"thought that they were already fully the case involves or
cleared of the charges, as they no arises from labor
longer received any summons/notices disputes;
on the intended "additional hearings"
mandated by the Disciplinary Board,"
2. . . . in granting a
they were surprised to receive "on
temporary injunction
February 23, 1995. . . a Memorandum
order when the
dated February 22, 1995" terminating
termination of private
their services for alleged violation of
respondents have long
respondent's Code of Discipline
been carried out;
"effective immediately"; that
sometime . . . first week of March,
1995, petitioner Pineda received 3. . . . in ordering the
another Memorandum from reinstatement of
respondent Mr. Juan Paraiso, advising private respondents on
him of his termination effective the basis of their mere
February 3, 1995, likewise for violation allegations, in violation
of respondent's Code of Discipline; . . . of PAL's right to due
process:
In support of the issuance of the writ of temporary
injunction, the NLRC adapted the view that: (1) private
 4. . . . in arrogating Besides, as earlier discussed, we
unto itself already exercised (on August 23,
management 1991) this temporary mandatory
prerogative to injunctive power in the case of
discipline its "Chemo-Technische Mfg., Inc.
employees and Employees Union-DFA et. al. vs.
divesting the labor Chemo-Technische Mfg., Inc., et. al."
arbiter of its original (supra) and effectively enjoined one
and exclusive (1) month old dismissals by Chemo-
jurisdiction over illegal Technische and that our aforesaid
dismissal cases; mandatory exercise of injunctive
power, when questioned through a
5. . . . in suspending petition for certiorari, was sustained by
the effects of the Third Division of the Supreme
termination when such court per its Resolution dated January
action is exclusively 25, 1993.
within the jurisdiction
of the Secretary of x x x           x x x          x x x
Labor;
Respondent's fourth argument that
6. . . . in issuing the petitioner's remedy for their dismissals
temporary injunction in is "to file an illegal dismissal case
the absence of any against PAL which cases are within
irreparable or the original and exclusive jurisdiction
substantial injury to of the Labor Arbiter' is ignorant. In
both private requiring as a condition for the
respondents. issuance of a "temporary or
permanent injunction" — "(4) That
On May 31, 1995, the NLRC denied petitioner's complainant has no adequate remedy
motion for reconsideration, ruling: at law;" Article 218 (e) of the Labor
Code clearly envisioned adequacy,
"The respondent (now petitioner), for and not plain availability of a remedy
one, cannot validly claim that we at law as an alternative bar to the
cannot exercise our injunctive power issuance of an injunction. An illegal
under Article 218 (e) of the Labor dismissal suit (which takes, on its
Code on the pretext that what we have expeditious side, three (3) years
here is not a labor dispute as long as it before it can be disposed of) while
concedes that as defined by law, a" (l) available as a remedy under Article
"Labor Dispute" includes any 217 (a) of the Labor Code, is certainly
controversy or matter not an "adequate; remedy at law,
concerning terms or conditions of Ergo, it cannot as an alternative
employment." If security of tenure, remedy, bar our exercise of that
which has been breached by injunctive power given us by Article
respondent and which, precisely, is 218 (e) of the Code.
sought to be protected by our
temporary mandatory injunction (the x x x           x x x          x x x
core of controversy in this case) is not
a "term or condition of employment", Thus, Article 218 (e), as earlier
what then is? discussed [which empowers this
Commission "to require the
x x x           x x x          x x x performance of a particular act" (such
as our requiring respondent "to cease
Anent respondent's second argument . and desist from enforcing" its
. . . Article 218 (e) of the Labor whimsical memoranda of dismissals
Code . . . empowered the Commission and "instead to reinstate petitioners to
not only to issue a prohibitory their respective position held prior to
injunction, but a mandatory ("to their subject dismissals") in "any labor
require the performance") one as well. dispute which, if not . . . performed
 forthwith, may cause grave and (e) To enjoin or restrain any actual or
irreparable damage to any party"] threatened commission of any or all
stands as the sole "adequate remedy prohibited or unlawful acts or to
at law" for petitioners here. require the performance of a particular
act in any labor dispute which, if not
Finally, the respondent, in its sixth restrained or performed forthwith, may
argument claims that even if its acts of cause grave or irreparable damage to
dismissing petitioners "may be great, any party or render ineffectual any
still the same is capable of decision in favor of such party; . . ."
compensation", and that (Emphasis Ours)
consequently, "injunction need not be
issued where adequate compensation Complementing the above-quoted provision, Sec. 1,
at law could be obtained". Actually, Rule XI of the New Rules of Procedure of the NLRC,
what respondent PAL argues here is pertinently provides as follows:
that we need not interfere in its
whimsical dismissals of petitioners as, Sec. 1. Injunction in Ordinary Labor
after all, it can pay the latter its Dispute. — A preliminary injunction or
backwages. . . . a restraining order may be granted by
the Commission through its divisions
But just the same, we have to stress pursuant to the provisions of
that Article 279 does not speak alone paragraph (e) of Article 218 of the
of backwages as an obtainable relief Labor Code, as amended, when it is
for illegal dismissal; that reinstatement established on the bases of the sworn
as well is the concern of said law, allegations in the petition that the acts
enforceable when necessary, through complained of, involving or arising
Article 218 (e) of the Labor Code from any labor dispute before the
(without need of an illegal dismissal Commission, which, if not restrained
suit under Article 217 (a) of the Code) or performed forthwith, may cause
if such whimsical and capricious act of grave or irreparable damage to any
illegal dismissal will "cause grave or party or render ineffectual any
irreparable injury to a party". . . . .
4
decision in favor of such party.

Hence, the present recourse. x x x           x x x          x x x

Generally, injunction is a preservative remedy for the The foregoing ancillary power may be

protection of one's substantive rights or interest. It is exercised by the Labor Arbiters only
not a cause of action in itself but merely a provisional as an incident to the cases pending
remedy, an adjunct to a main suit. It is resorted to only before them in order to preserve the
when there is a pressing necessity to avoid injurious rights of the parties during the
consequences which cannot be remedied under any pendency of the case, but excluding
standard of compensation. The application of the labor disputes involving strikes or
injunctive writ rests upon the existence of an lockout.   (Emphasis Ours)
7

emergency or of a special reason before the main

case be regularly heard. The essential conditions for From the foregoing provisions of law, the power of the
granting such temporary injunctive relief are that the NLRC to issue an injunctive writ originates from "any
complaint alleges facts which appear to be sufficient labor dispute" upon application by a party thereof,
to constitute a proper basis for injunction and that on which application if not granted "may cause grave or
the entire showing from the contending parties, the irreparable damage to any party or render ineffectual
injunction is reasonably necessary to protect the legal any decision in favor of such party."
rights of the plaintiff pending the litigation.  Injunction
5

is also a special equitable relief granted only in cases The term "labor dispute" is defined as "any
where there is no plain, adequate and complete controversy or matter concerning terms and
remedy at law. 6
conditions of employment or the association or
representation of persons in negotiating, fixing.
In labor cases, Article 218 of the Labor Code maintaining, changing, or arranging the terms and
empowers the NLRC — conditions of employment regardless of whether or
not the disputants stand in the proximate relation of
employers and employees."  8
The term "controversy" is likewise defined as involving the legality of
"a litigated question; adversary proceeding in a court strikes and lockouts;
of law; a civil action or suit, either at law or in equity; a and
justiciable dispute."9

(6) Except claims for

A "justiciable controversy" is "one involving an active employees
antagonistic assertion of a legal right on one side and compensation, social
a denial thereof on the other concerning a real, and security, medicare and
not a mere theoretical question or issue."  10
maternity benefits, all
other claims arising
Taking into account the foregoing definitions, it is an from employer-
essential requirement that there must first be a labor employee relations,
dispute between the contending parties before the including those of
labor arbiter. In the present case, there is no labor persons in domestic or
dispute between the petitioner and private household service,
respondents as there has yet been no complaint for involving an amount
illegal dismissal filed with the labor arbiter by the exceeding five
private respondents against the petitioner. thousand pesos
(P5,000.00), whether
The petition for injunction directly filed before the or not accompanied
NLRC is in reality an action for illegal dismissal. This with a claim for
is clear from the allegations in the petition which prays reinstatement.  11

for; reinstatement of private respondents; award of full

backwages, moral and exemplary damages; and The jurisdiction conferred by the foregoing legal
attorney's fees. As such, the petition should have provision to the labor arbiter is
been filed with the labor arbiter who has the original both original and exclusive, meaning, no other officer
and exclusive jurisdiction to hear and decide the or tribunal can take cognizance of, hear and decide
following cases involving all workers, whether any of the cases therein enumerated. The only
agricultural or non-agricultural: exceptions are where the Secretary of Labor and
Employment or the NLRC exercises the power of
(1) Unfair labor compulsory arbitration, or the parties agree to submit
practice; the matter to voluntary arbitration pursuant to Article
263 (g) of the Labor Code, the pertinent portions of
which reads:
(2) Termination
disputes;
(g) When, in his opinion, there exists a
labor dispute causing or likely to
(3) If accompanied
cause a strike or lockout in an industry
with a claim for
indispensable to the national interest,
reinstatement, those
the Secretary of Labor and
cases that workers
Employment may assume jurisdiction
may file involving
over the dispute and decide it or
wages, rates of pay,
certify the same to the Commission for
hours of work and
compulsory arbitration. Such
other terms and
assumption or certification shall have
conditions of
the effect of automatically enjoining
employment;
the intended or impending strike or
lockout as specified in the assumption
(4) Claims for actual, or certification order. If one has
moral, exemplary and already taken place at the time of
other forms of assumption or certification, all striking
damages arising from or locked out employees shall
the employer- immediately resume operations and
employee relations; readmit all workers under the same
terms and conditions prevailing before
(5) Cases arising from the strike or lockout. The Secretary of
any violation of Article Labor and Employment or the
264 of this Code, Commission may seek the assistance
including questions of law enforcement agencies to
 ensure compliance with this provision respondents might suffer. An injury is considered
as well as with such orders as he may irreparable if it is of such constant and frequent
issue to enforce the same. recurrence that no fair and reasonable redress
can be had therefor in a court of law,   or where
18

On the other hand, the NLRC shall have there is no standard by which their amount can be
exclusive appellate jurisdiction over all cases decided measured with reasonable accuracy, that is, it is
by labor arbiters as provided in Article 217(b) of the not susceptible of mathematical computation. It is
Labor Code. In short, the jurisdiction of the NLRC in considered irreparable injury when it cannot be
illegal dismissal cases is appellate in nature and, adequately compensated in damages due to the
therefore, it cannot entertain the private respondents' nature of the injury itself or the nature of the right
petition for injunction which challenges the dismissal or property injured or when there exists no certain
orders of petitioner. Article 218(e) of the Labor Code pecuniary standard for the measurement of
does not provide blanket authority to the NLRC or any damages.  19

of its divisions to issue writs of injunction, considering

that Section 1 of Rule XI of the New Rules of In the case at bar, the alleged injury which private
Procedure of the NLRC makes injunction only an respondents stand to suffer by reason of their
ancillary remedy in ordinary labor disputes."  12
alleged illegal dismissal can be adequately
compensated and therefore, there exists no
Thus, the NLRC exceeded its jurisdiction when it "irreparable injury," as defined above which
issued the assailed Order granting private would necessitate the issuance of the injunction
respondents' petition for injunction and ordering the sought for. Article 279 of the Labor Code provides
petitioner to reinstate private respondents. that an employee who is unjustly dismissed from
employment shall be entitled to reinstatement,
The argument of the NLRC in its assailed Order that without loss of seniority rights and other
to file an illegal dismissal suit with the labor arbiter is privileges, and to the payment of full backwages,
not an "adequate" remedy since it takes three (3) inclusive of allowances, and to other benefits or
years before it can be disposed of, is patently their monetary equivalent computed from the time
erroneous. An "adequate" remedy at law has been his compensation was withheld from him up to
defined as one "that affords relief with reference to the the time of his actual reinstatement.
matter in controversy, and which is appropriate to the
particular circumstances of the case."   It is a remedy
13 The ruling of the NLRC that the Supreme Court
which is equally, beneficial, speedy and sufficient upheld its power to issue temporary mandatory
which will promptly relieve the petitioner from the injunction orders in the case of Chemo-
injurious effects of the acts complained of.  14 Technische Mfg., Inc. Employees Union-DFA,
et. al. vs. Chemo-Technische Mfg., Inc. et. al.,
Under the Labor Code, the ordinary and proper docketed as G.R. No. 107031, is misleading. As
recourse of an illegally dismissed employee is to file a correctly argued by the petitioner, no such
complaint for illegal dismissal with the labor pronouncement was made by this Court in said
arbiter.   In the case at bar, private respondents
15 case. On January 25, 1993, we issued a Minute
disregarded this rule and directly went to the Resolution in the subject case stating as follows:
NLRC through a petition for injunction praying
that petitioner be enjoined from enforcing its Considering the allegations
dismissal orders. In Lamb vs. Phipps,   we ruled
16 contained, the issues raised and
that if the remedy is specifically provided by law, the arguments adduced in the
it is presumed to be adequate. Moreover, the petition for certiorari, as well as the
preliminary mandatory injunction prayed for by comments of both public and
the private respondents in their petition before the private respondents thereon, and
NLRC can also be entertained by the labor arbiter the reply of the petitioners to
who, as shown earlier, has the ancillary power to private respondent's motion to
issue preliminary injunctions or restraining orders dismiss the petition, the Court
as an incident in the cases pending before him in Resolved to DENY the same for
order to preserve the rights of the parties during being premature.
the pendency of the case.  17

It is clear from the above resolution that we did

Furthermore, an examination of private not in anyway sustain the action of the NLRC in
respondents' petition for injunction reveals that it issuing such temporary mandatory injunction but
has no basis since there is no showing of any rather we dismissed the petition as the NLRC had
urgency or irreparable injury which the private yet to rule upon the motion for reconsideration
filed by petitioner. Thus, the minute resolution
denying the petition for being prematurely filed.

Finally, an injunction, as an extraordinary remedy,

is not favored in labor law considering that it
generally has not proved to be an effective means
of settling labor disputes.   It has been the policy
20

of the State to encourage the parties to use the

non-judicial process of negotiation and
compromise, mediation and arbitration.   Thus,
21

injunctions may be issued only in cases of

extreme necessity based on legal grounds clearly
established, after due consultations or hearing
and when all efforts at conciliation are exhausted
which factors, however, are clearly absent in the
present case.

WHEREFORE, the petition is hereby GRANTED.

The assailed Orders dated April 3, 1995 and May
31, 1995, issued by the National Labor Relations
Commission (First Division), in NLRC NCR IC No.
000563-95, are hereby REVERSED and SET
ASIDE.

SO ORDERED.