H.E. Heacock Co. (G.R. No. L-5577. July 31, 1954)

G.R. No. L-5577. July 31, 1954 - H. E. HEACOCK CO. v. NATIONAL LABOR UNION, ET AL.

FACTS: The National Labor Union filed a petition in the Court of Industrial Relations against H.E. Heacock Co. praying that the latter be ordered to pay to all its low-salaried employees their bonus for the years 1948 and 1949, in an amount equivalent to one month salary for each year, it being alleged in substance that the Company promised that said benefit would be granted yearly to the employees, provided sufficient profits were made; that in 1948 and 1949, the Company, notwithstanding available profits, distributed bonus only to its highsalaried employees; that upon the Company's failure to accede to the Union's demand for the payment of the stipulated bonus for the years 1948 and 1949, and upon its refusal to submit the matter to the labormanagement committee in accordance with the collective bargaining agreement, the employees declared a strike.

After the hearing, the court found as proven the facts alleged in the petition and rendered a decision in favor of the employees, ordering the company to pay them one month salary as bonus for the year 1948 and another one month salary for the year 1949. A subsequent motion for reconsideration filed by the company was denied by the resolution of the court en banc. The instant petition for certiorari was filed by the company, assailing the decision of the Court of Industrial Relations. The Company contends that it has never assumed the obligation of paying the bonus claimed by the Union, and that there is no evidence whatsoever tending to prove such obligation.

ISSUE: Is there evidence to support the findings of the Court of Industrial Relations?HELD: Yes. (1) No denial or correction made by respondent company of newspaper advertisement re promise to give bonus. — "It appears that the issues of the Manila Times and the Manila Chronicle of August 22,1948 featured a 'Heacock Supplement' which contained the following paragraph 'At the end of every year, Mr. Orosa declared, the Heacock employees enjoy a profit-sharing privilege when they are given bonuses by the management, the amount depending on the profits realized during that year. This progressive policy, he pointed out, makes for a genuine interest on the part of the employees to work honestly and sincerely for the good of the company — a company which is theirs in a sense.'

These statements are denied by Mr. Orosa, Vice-President and Assistant General Manager of the Company; and attorneys for the latter argued that the Assistant Manager of the Personnel Service Advertising Bureau which was then handling the advertising account of the Company, prepared the Heacock Supplement, and testifying on his interview with Mr. Orosa, declared that he was not certain as to the nature of the bonus talked about, and that he thought that it referred to the Christmas bonus which the Company gives to its employees at the end of every year, and that this was what he had in mind when he wrote the article in question.

The Court of Industrial Relations gave no weight to the denial of Mr. Orosa, and observed that the latter was aware, or should have read and known the Supplement in question, and his failure to make any correction or denial of its contents shortly after its publication, negates any stand now taken by him.

The Company also points out that both Mr. Gunn and Mr. Orosa could not legally bind the Company which can only act through its board of directors, and there is nothing in the record to show that the Board promised to pay any yearly bonus or ratified the alleged promise made by Mr. Orosa. Counsel for the Union, however, observes that notwithstanding the publication of the Heacock Supplement which undoubtedly must have been noticed by all the officials of the Company, no correction or denial ever came from its board of directors which, by such silence must be deemed as having ratified the commitment of Mr. Gunn and the statement of policy featured in the Heacock Supplement."

(2) Promise also confirmed by company's letter addressed to Union. — "The Court of Industrial Relations also invoked, as another circumstance confirming the promise made by Mr. Gunn to pay an annual bonus to all the low-salaried employees of the Company, the following passage contained in this letter of February 19, 1949, addressed to the Union: 'This company desires to call your attention to the fact that the salaries, bonuses (en plural por referirse al bono de Navidad y al bono por razon de utilidades), paid vacation leaves, paid sick leave, medical and dental services, and other privileges and facilities accorded to its employees are the highest in the City of Manila for comparable positions and, as a consequence, we cannot consider any general increase in wages at the present time without doing violence to the stability of the labor situation here, of which you are fully aware.'" (H.E. Heacock Co. v. National Labor Union, 103 Phil. 600 [19581.)