THIRD DIVISION

[G.R. No. 191714. February 26, 2014.]

T & H SHOPFITTERS CORPORATION/GIN QUEEN

CORPORATION, STINNES HUANG, BEN HUANG and ROGELIO
MADRIAGA, petitioners, vs. T & H SHOPFITTERS
CORPORATION/GIN QUEEN WORKERS UNION, ELPIDIO
ZALDIVAR, DARIOS GONZALES, WILLIAM DOMINGO, BOBBY
CASTILLO, JIMMY M. PASCUA, GERMANO M. BAJO, RICO L.
MANZANO, ALLAN L. CALLORINA, ROMEO BLANCO, GILBERT
M. GARCIA, CARLOS F. GERILLO, EDUARDO A. GRANDE,
EDILBRANDO MARTICIO, VIVENCIO SUSANO, ROLANDO
GARCIA, JR., MICHAEL FABABIER, ROWELL MADRIAGA,
PRESNIL TOLENTINO, MARVIN VENTURA, FRANCISCO
RIVARES, PLACIDO TOLENTINO and ROLANDO ROMERO,
respondents.

DECISION

MENDOZA, J : p

Assailed in this petition for review on certiorari under Rule 45 of the

Rules of Court are: 1) the November 12, 2009 Decision 1 of the Court of
Appeals (CA), in CA-G.R. SP No. 107188, which affirmed the July 24, 2007
and November 13, 2008 Decision 2 of the National Labor Relations
Commission (NLRC); and 2) its March 24, 2010 Resolution 3 denying
reconsideration of its decision.
The Facts
On September 7, 2004, the T&H Shopfitters Corporation/Gin Queen
Corporation workers union (THS-GQ Union) and Elpidio Zaldivar, 4 Darios
Gonzales, William Domingo, Bobby Castillo, Jimmy M. Pascua, Germano M.
Bajo, 5 Rico L. Manzano, Allan L. Callorina, 6 Romeo Blanco, Gilbert M. Garcia,
Carlos F. Gerillo, Eduardo A. Grande, Edilbrando Marticio, Vivencio Susano,
Rolando Garcia, Jr., Michael Fababier, Rowell Madriaga, Presnil Tolentino,
Marvin Ventura, Francisco Rivares, Placido Tolentino, and Rolando Romero
(respondents), all of whom are officers and/or members of THS-GQ union,
filed their Complaint 7 for Unfair Labor Practice (ULP) by way of union
busting, and Illegal Lockout, with moral and exemplary damages and
attorney's fees, against T&H Shopfitters Corporation (T&H Shopfitters) and
Gin Queen Corporation (Gin Queen) (collectively referred to as "petitioners"),
before the Labor Arbiter (LA). cCEAHT

Respondents treated T&H Shopfitters and Gin Queen as a single entity

and their sole employer. In their desire to improve their working conditions,
respondents and other employees of petitioners held their first formal
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 meeting on November 23, 2003 to discuss the formation of a union. The
following day or on November 24, 2003, seventeen (17) employees were
barred from entering petitioners' factory premises located in Castillejos,
Zambales, and ordered to transfer to T&H Shopfitters' warehouse at Subic
Bay Freeport Zone (SBFZ) purportedly because of its expansion. Afterwards,
the said seventeen (17) employees were repeatedly ordered to go on forced
leave due to the unavailability of work.
On December 18, 2003, the Department of Labor and Employment
(DOLE), Regional Office No. III issued a certificate of registration in favor of
THS-GQ Union.
Respondents contended that the affected employees were not given
regular work assignments, while subcontractors were continuously hired to
perform their functions. This development prompted respondents to seek the
assistance of the National Conciliation and Mediation Board. Subsequently,
an agreement between petitioners and THS-GQ Union was reached.
Petitioners agreed to give priority to regular employees in the distribution of
work assignments. Respondents averred, however, that petitioners never
complied with its commitment but instead hired contractual workers.
On March 24, 2004, THS-GQ Union filed a petition for certification
election. On July 12, 2004, an order was issued to hold the certification
election in both T&H Shopfitters and Gin Queen. Eventually, the certification
election was scheduled on October 11, 2004.
Meanwhile, through a memorandum, dated August 17, 2004, petitioner
Ben Huang (Huang), Director for Gin Queen, informed its employees of the
expiration of the lease contract between Gin Queen and its lessor in
Castillejos, Zambales and announced the relocation of its office and workers
to Cabangan, Zambales. Some of the respondents, who visited the site in
Cabangan, discovered that it was a "talahiban" or grassland. Later, the said
union officers and members were made to work as grass cutters in
Cabangan, under the supervision of a certain Barangay Captain Greg
Pangan. Due to these circumstances, the employees assigned in Cabangan
did not report for work. As a consequence, the THS-GQ Union president was
made to explain why he should not be terminated for insubordination. The
other employees who likewise failed to report in Cabangan were meted out
with suspension.
On October 10, 2004, petitioners sponsored a field trip to Iba,
Zambales, for its employees. The officers and members of the THS-GQ Union
were purportedly excluded from the field trip. On the evening of the field
trip, a certain Angel Madriaga, a sales officer of petitioners, campaigned
against the union in the forthcoming certification election.
EcDTIH

The following day or on October 11, 2004, the employees were

escorted from the field trip to the polling center in Zambales to cast their
votes. On October 13, 2004, the remaining employees situated at the SBFZ
plant cast their votes as well. Due to the heavy pressure exerted by
petitioners, the votes for "no union" prevailed. On October 14, 2004, the
THS-GQ Union filed its protest with respect to the certification election
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 proceedings.
Respondents averred that the following week after the certification
elections were held, petitioners retrenched THG-GQ Union officers and
members assigned at the Zambales plant. Respondents claimed that the
work weeks of those employees in the SBFZ plant were drastically reduced
to only three (3) days in a month.
In its defense, Gin Queen, claiming that it is a corporation separate and
distinct from T&H Shopfitters, stressed that respondents were all employees.
Gin Queen claimed that due to the decrease in orders from its customers,
they had to resort to cost cutting measures to avoid anticipated financial
losses. Thus, it assigned work on a rotational basis. It was of the impression
that the employees, who opposed its economic measures, were merely
motivated by spite in filing the complaint for ULP against it.
In addition, Gin Queen explained that its transfer from Castillejos,
Zambales to Cabangan, Zambales was a result of the expiration of its lease
agreement with Myra D. Lumibao (Myna), its lessor. Since the Cabangan site
was bare and still required construction, Gin Queen offered work, to
employees who opted to stay, on rotation as well.
In its Decision, 8 dated December 21, 2005, the LA dismissed
respondents' complaint and all their money claims for lack of merit.
In dismissing the complaint, the LA explained:
xxx xxx xxx.
In the case at bar, we carefully examined the grounds raised by
the complainants [herein respondents] as basis for claiming that the
respondents [herein petitioners] committed unfair labor practices by
way of illegal lockout, one of which is the alleged transfer of 17 workers
to Subic Bay Freeport Zone, however, we are dismay (sic) to know that
not even one of these 17 workers is a complainant in these cases.
While the labor union may represent its members in filing cases before
this Office, at least these members must show their intention to file a
case by signing in the complaint to prove that they have grievances
against their employer which was lacking in these cases. Further, there
was no showing that the transfer of these 17 workers is considered an
unfair labor practice of the respondents considering that their transfer
was effected long before the union was organized.
We also analyzed the allegations of the complainants that the
transfer of the working cite (sic) of the respondent Gin Queen
Corporation was a part of the unfair labor practices committed by the
respondents, however, the complainants failed miserably to controvert
the documentary evidence adduced by the respondent Gin Queen
Corporation that the lease contract agreement of the place had already
expired and it was the management prerogative to transfer as a cost
cutting measures. Again the transfer of the place of work would not be
considered as unfair labor practice. ScHAIT

Complainants alleged that the respondents committed unfair

labor practices by means of 'lockout' wherein the respondents should
have temporarily refused to provide work to the complainants by a
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 result of labor or industrial dispute. Complainants failed to show that
the rotation of work for them is considered an unfair labor practice and
considered a 'Lockout'. Complainants rather submitted several notices
showing that the company has no sufficient orders coming from clients
and does not have enough raw materials for production as basis for
these complainants not to render work and be rotated, and thus
controvert their allegations that there was 'lockout' committed by the
respondents. Further, the documentary evidences adduced by the
complainants clearly show that respondents never terminated the
complainants when they were given their notices of suspension
negating the claim that there was 'lockout' committed by respondents.
xxx xxx xxx. 9
Aggrieved, respondents appealed to the NLRC. In its July 24, 2007
Decision, the NLRC reversed the LA decision and ruled in favor of
respondents. The dispositive portion of the said decision reads:
WHEREFORE, the decision appealed from is hereby REVERSED.
Respondents T & H Shopfitters Corp., Gin Queen Corp. (or 'MDL',
as it is now called), Stennis Huang, as well as the presidents of the
respondent corporations as of November 2003 and the date of the
execution of this decision are hereby ordered to pay each of the
complainants moral and exemplary damages amounting to P50,000.00
and P35,000.00 respectively. In addition, they shall pay the
complainants attorney's fees equivalent to ten percent (10%) of the
total judgment award.
SO ORDERED.
In granting the appeal, the NLRC reasoned:
Based on the above-mentioned affidavits, 10 it may be concluded
that the respondents [herein petitioners] committed unfair labor
practice acts consisting in interfering with the exercise of the
employees' right to self-organization (specifically, sponsoring a field
trip on the day preceding the certification election, warning the
employees of dire consequences should the union prevail, and
escorting them to the polling center) and discriminating in regard to
conditions of employment in order to discourage union membership
(assigning union officers and active union members as grass cutters on
rotation basis).
xxx xxx xxx
Furthermore, it is noteworthy that, based on their Articles of
Incorporation, T & H Corporation and Gin Queen Corporation are
engaged in the same line of business.
It should also be noted that respondents did not controvert the
allegations to the effect that Myra D. Lumibao, the supposed lessor of
respondent corporations, is the wife of respondent Stennis Huang, and
that Gin Queen Corporation has been renamed 'MDL', but still carries
on the same business in the same premises using the same machines
and facilities. These circumstances, together with the supposed
assignment of respondent Stennis Huang's interest in Gin Queen
Corporation to a third party are badges of fraud that justify the piercing
of the veil of corporate fiction. . . .
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 Thus, based on the foregoing, respondents T & H Shopfitters
Corporation, Gin Queen Corporation (now known as 'MDL') and Stennis
Huang, as well as the presidents of the respondent corporations as of
November 2003 and the date of execution of this decision may be held
liable for unfair labor practice and the corresponding award of moral
and exemplary damages. 11
Petitioners filed a motion for reconsideration but the NLRC denied the
same in its November 13, 2008 Decision. ACcTDS

Dissatisfied with the adverse ruling, petitioners instituted a petition for

certiorari under Rule 65 of the Rules of Court before the CA arguing grave
abuse of discretion on the part of the NLRC in reversing the LA decision.
In its Decision, dated November 12, 2009, the CA sustained the NLRC
ruling. The fallo of which reads:
WHEREFORE, premises considered, the petition for certiorari is
DENIED. The NLRC Decisions dated July 24, 2007 and November 13,
2008 in NLRC NCR CA NO. 048258 (NLRC RAB III-09-7882-04, NLRC RAB
III-09-7980-04) are AFFIRMED.
SO ORDERED.
The CA held that errors of judgment are not within the province of a
special civil action for certiorari. It declared that factual findings of quasi-
judicial agencies that had acquired expertise in matters entrusted to their
jurisdiction were accorded not only respect but finality if they were
supported by substantial evidence. The CA noted that the NLRC considered
the evidence and applied the law in this case, thus, no grave abuse of
discretion could be imputed on the part of the NLRC in reversing the LA
ruling.
Petitioners moved for reconsideration but the same was denied by the
CA in its March 24, 2010 Resolution.
Not in conformity with the ruling of the CA, petitioners seek relief with
this Court raising the following
ISSUES
I. WHETHER OR NOT PETITIONERS T & H SHOPFITTERS
CORPORATION AND GIN QUEEN CORPORATION ARE ONE
AND THE SAME CORPORATION.
II. WHETHER OR NOT PETITIONER GIN QUEEN CORPORATION IS
LIABLE TO THE RESPONDENTS FOR UNFAIR LABOR
PRACTICE.
III. WHETHER OR NOT THE AWARD OF MORAL AND EXEMPLARY
DAMAGES IN FAVOR OF THE RESPONDENTS IS PROPER.
IV. WHETHER OR NOT THE AWARD OF TEN PERCENT (10%)
ATTORNEY'S FEES IN FAVOR OF THE RESPONDENT IS
PROPER. 12

Simply put, the issue for the Court's resolution is whether ULP acts
were committed by petitioners against respondents in the case at bench.
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 In support of their position, petitioners stress that T&H Shopfitters and
Gin Queen are corporations separate and distinct from each other.
Consequently, T&H Shopfitters and Stinnes Huang, an officer of T&H
Shopfitters, cannot be held liable for ULP for the reason that there is no
employer-employee relationship between the former and respondents.
Further, Gin Queen avers that its decision to implement an enforced rotation
of work assignments for respondents was a management prerogative
permitted by law, justified by the decrease in the orders it received from its
customers. It explains that its failure to present concrete proof of its
decreasing orders was due to the impossibility of proving a negative
assertion. It also asserts that the transfer from Castillejos to Cabangan was
made in good faith and solely because of the expiration of its lease contract
in Castillejos.
The Court's Ruling
As to the issue of ULP, petitioners' argument is utterly without merit.
In the case at bench, petitioners are being accused of violations of
paragraphs (a), (c), and (e) of Article 257 (formerly Article 248) of the Labor
Code, 13 to wit:
Article 257. Unfair labor practices of employers. — It shall be
unlawful for an employer to commit any of the following unfair labor
practices:
(a) To interfere with, restrain or coerce employees in the exercise
of their right to self-organization;
xxx xxx xxx
(c) To contract out services or functions being performed by
union members when such will interfere with, restrain, or coerce
employees in the exercise of their right to self-organization;
xxx xxx xxx
(e) To discriminate in regard to wages, hours of work, and other
terms and conditions of employment in order to encourage or
discourage membership in any labor organization. . . .
The concept of ULP is embodied in Article 256 (formerly Article 247) of
the Labor Code, 14 which provides:
Article 256. Concept of unfair labor practice and procedure for
prosecution thereof. — Unfair labor practices violate the constitutional
right of workers and employees to self-organization, are inimical to the
legitimate interests of both labor and management, including their
right to bargain collectively and otherwise deal with each other in an
atmosphere of freedom and mutual respect, disrupt industrial peace
and hinder the promotion of healthy and stable labor-management
relations.
xxx xxx xxx
In essence, ULP relates to the commission of acts that transgress the
workers' right to organize. As specified in Articles 248 [now Article 257] and
249 [now Article 258] of the Labor Code, the prohibited acts must necessarily
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 relate to the workers' right to self-organization . . . . 15

In the case of Insular Life Assurance Co., Ltd. Employees Association —

NATU v. Insular Life Assurance Co. Ltd. , 16 this Court had occasion to lay
down the test of whether an employer has interfered with and coerced
employees in the exercise of their right to self-organization, that is, whether
the employer has engaged in conduct which, it may reasonably be said,
tends to interfere with the free exercise of employees' rights; and that it is
not necessary that there be direct evidence that any employee was in fact
intimidated or coerced by statements of threats of the employer if there is a
reasonable inference that anti-union conduct of the employer does have an
adverse effect on self-organization and collective bargaining.
The questioned acts of petitioners, namely: 1) sponsoring a field trip to
Zambales for its employees, to the exclusion of union members, before the
scheduled certification election; 2) the active campaign by the sales officer
of petitioners against the union prevailing as a bargaining agent during the
field trip; 3) escorting its employees after the field trip to the polling center;
4) the continuous hiring of subcontractors performing respondents'
functions; 5) assigning union members to the Cabangan site to work as grass
cutters; and 6) the enforcement of work on a rotational basis for union
members, all reek of interference on the part of petitioners.
Indubitably, the various acts of petitioners, taken together, reasonably
support an inference that, indeed, such were all orchestrated to restrict
respondents' free exercise of their right to self-organization. The Court is of
the considered view that petitioners' undisputed actions prior and
immediately before the scheduled certification election, while seemingly
innocuous, unduly meddled in the affairs of its employees in selecting their
exclusive bargaining representative. In Holy Child Catholic School v. Hon.
Patricia Sto. Tomas , 17 the Court ruled that a certification election was the
sole concern of the workers, save when the employer itself had to file the
petition . . ., but even after such filing, its role in the certification process
ceased and became merely a bystander. Thus, petitioners had no business
persuading and/or assisting its employees in their legally protected
independent process of selecting their exclusive bargaining representative.
The fact and peculiar timing of the field trip sponsored by petitioners for its
employees not affiliated with THS-GQ Union, although a positive enticement,
was undoubtedly extraneous influence designed to impede respondents in
their quest to be certified. This cannot be countenanced.
Not content with achieving a "no union" vote in the certification
election, petitioners launched a vindictive campaign against union members
by assigning work on a rotational basis while subcontractors performed the
latter's functions regularly. Worse, some of the respondents were made to
work as grass cutters in an effort to dissuade them from further collective
action. Again, this cannot be countenanced. HSAcaE

More importantly, petitioners' bare denial of some of the complained

acts and unacceptable explanations, a mere afterthought at best, cannot
prevail over respondents' detailed narration of the events that transpired. At
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 this juncture, it bears to emphasize that in labor cases, the quantum of proof
necessary is substantial evidence, 18 or that amount of relevant evidence as
a reasonable mind might accept as adequate to support a conclusion, even if
other minds, equally reasonable, might conceivably opine otherwise. 19
In fine, mindful of the nature of the charge of ULP, including its civil
and/or criminal consequences, the Court finds that the NLRC, as correctly
sustained by the CA, had sufficient factual and legal bases to support its
finding of ULP.
Anent the issue on the award of attorney's fees, the applicable law
concerning the grant thereof in labor cases is Article 111 20 of the Labor
Code. Pursuant thereto, the award of 10% attorney's fees is limited to cases
of unlawful withholding of wages. In this case, however, the Court cannot
find any claim or proof that petitioners unlawfully withheld the wages of
respondents. Consequently, the grant of 10% attorney's fees in favor of
respondents is not justified under the circumstances. Accordingly, the Court
deems it proper to delete the same.
WHEREFORE, the November 12, 2009 Decision of the Court of
Appeals and its March 24, 2010 Resolution, in CA-G.R. SP No. 107188, are
AFFIRMED, except with respect to the award of attorney's fees which is
hereby DELETED.
SO ORDERED.
Velasco, Jr., Peralta, Bersamin *and Leonen, JJ., concur.

Footnotes
* Designated Acting Member in lieu of Associate Justice Roberto A. Abad, per
Special Order No. 1640 dated February 19, 2014.
1. Rollo , pp. 34-45. Penned by Associate Justice Jose C. Reyes with Presiding Justice
Conrado M. Vasquez and Associate Justice Apolinario D. Bruselas, Jr.,
concurring.

2. Id. at 81-90 and 91-93, respectively.

3. Id. at 47.
4. Also referred to as Elpidio Saldivar in the Certification Against Non-forum
Shopping filed before the LA, id. at 105.
5. Also referred to as Germano P. Bajo in the Certification Against Non-forum
Shopping filed before the LA, id.
6. Also referred to as Allan F. Callorina in the Certification Against Non-forum
Shopping filed before the LA, id.
7. Id. at 104-106.
8. Id. at 203-215.
9. Citations omitted.

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 10. Executed by herein respondent Elpidio Zaldivar; and a certain Darius
Bustamante, who is not a party in the present case.
11. Citations omitted.
12. Rollo , p. 16.
13. Renumbered pursuant to Republic Act No. 10151.

14. Renumbered pursuant to Republic Act No. 10151.

15. Baptista v. Villanueva, G.R. No. 194709, July 31, 2013.
16. 147 Phil. 194 (1971).
17. G.R. No. 179146, July 23, 2013.
18. Antiquina v. Magsaysay Maritime Corporation, G.R. No. 168922, April 13, 2011,
648 SCRA 659, 675, citing National Union of Workers in Hotels, Restaurants
and Allied Industries-Manila Pavilion Hotel Chapter v. National Labor
Relations Commission, G.R. No. 179402, September 30, 2008, 567 SCRA
291.

19. Surigao Del Norte Electric Cooperative v. Gonzaga, G.R. No. 187722, June 10,
2013, citing Caltex Philippines, Inc. v. Agad, G.R. No. 162017, April 23, 2010,
619 SCRA 196, 207.
20. Art. 111. Attorney's fees. —
  a. In cases of unlawful withholding of wages, the culpable party may be
assessed attorney's fees equivalent to ten percent of the amount of wages
recovered.
  b. It shall be unlawful for any person to demand or accept, in any judicial or
administrative proceedings for the recovery of wages, attorney's fees which
exceed ten percent of the amount of wages recovered.

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