Cirtek Employees v. Cirtek Electronics

GR No. 190515: November 15, 2010


Carpio-Morales, J.:


Cirtek Electronics had a Collective Bargaining Agreement with its employees, thru Petitioner labor union. Prior to the 3rdyear of the CBA, the parties renegotiated its economic provisions but failed to reach a settlement, particularly on the issue of wage increases. Petitioner thereafter declared a bargaining deadlock, and filed a Notice of Strike, while Respondent filed a Notice of Lockout.

There being no Amicable Settlement, the Secretary of Labour assumed jurisdiction over the controversy. However, both petitioners and respondent came into an amicable resolution and had a Memorandum of Agreement (MOA) which increased the wages from P6 to P9 each day. The MOA was submitted to the Secretary, who issued a different ruling of 6-10 and 9-15 php per day. Responded filed with the CA, imputing grave abuse of discretion, which was eventually granted.

Petitioners MR having been denied, appeals to the Supreme Court


1. Whether or not the Secretary is authorized to give an award higher than that agreed upon in the MOA.

2. Whether the MOA was entered into and ratified by the remaining officers of petitioner under the condition, which was not incorporated in the MOA, that respondent would honour the Secretary of Labours award in the event that it is higher.


Petition is granted.

Labor Law: Collective Bargaining Agreement

It is well-settled that the Secretary of Labor, in the exercise of his power to assume jurisdiction under Art. 263 (g)of the LaborCode, may resolve all issues involved in the controversy including the award of wage increases and benefits. While an arbitral award cannotper sebe categorized as an agreement voluntarily entered into by the parties because it requires the intervention and imposing power of the State thru the Secretary of Labor when he assumes jurisdiction, the arbitral award can be considered anapproximation of a collective bargaining agreementwhich would otherwise have been entered into by the parties, hence, it has the force and effect of a valid contract obligation.

The Secretary is not limited to considering the MOA as basis in computing the wage increases. The filing and submission of the MOA did not have the effect of divesting the Secretary of his jurisdiction, or of automatically disposing the controversy, thenneither should the provisions of the MOA restrict the Secretarys leewayin deciding the matters before him.

Petition GRANTED. The values computed by the Secretary is reinstated.