UNIVERSITY OF SAN AGUSTIN, INC. VS UNIVERSITY OF SAN AGUSTIN EMPLOYEES UNION-FFW

UNIVERSITY OF SAN AGUSTIN, INC.

VS

UNIVERSITY OF SAN AGUSTIN EMPLOYEES UNION-FFW
593 SCRA 663 (2009)

A collective bargaining agreement, when voluntarily entered into by the parties, becomes the law between them.

In the Collective Bargaining Agreement (CBA) between University of San Agustin and its Employees Union, the parties agreed to include a provision on salary increases based on the incremental tuition fee increases or tuition incremental proceeds (TIP). However, the parties disagreed whether or not the term ―salary increases‖ includes other increases in benefits received by the employee.

The Voluntary Arbiter held that the salary increase shall be paid out of 80% of the TIP, should it be higher than P1,500. Moreover, scholarship grants and tuition fee discounts given by the university should not be deducted from the TIP. The appellate court sustained the interpretation of the CBA but revised TIP computation. The present petition questions only the interpretation of the CBA provision by the appellate court.

ISSUES:
Whether or not the provisions of the CBA should be applied

HELD:
It is a familiar and fundamental doctrine in labor law that the CBA is the law between the parties and they are obliged to comply with its provisions. If the terms of a contract, in this case the CBA, are clear and leave no doubt upon the intention of the contracting parties, the literal meaning of their stipulations shall control.

A reading of the provisions of the CBA shows that the parties agreed that 80% of the TIP or at the least the amount of P1,500 is to be allocated for individual salary increases.

The CBA does not speak of any other benefits or increases which would be covered by the employees’ share in the TIP, except salary increases. The CBA reflects the incorporation of different provisions to cover other benefits such as Christmas bonus (Art. VIII, Sec. 1), service award (Art. VIII, Sec.5), leaves (Article IX), educational benefits (Sec.2, Art. X), medical and hospitalization benefits (Secs. 3, 4 and 5, Art. 10), bereavement assistance (Sec. 6, Art. X), and signing bonus (Sec. 8, Art. VIII), without mentioning that these will likewise be sourced from the TIP. Thus, the university’s belated claim that the 80% TIP should be taken to mean as covering ALL increases and not merely the salary increases as categorically stated in Sec. 3, Art. VIII of the CBA does not lie.

In the present case, the university could have, during the CBA negotiations, opposed the inclusion of or renegotiated the provision allotting 80% of the TIP to salary increases alone, as it was and is not under any obligation to accept respondent’s demands hook, line and sinker. Art. 252 of the Labor Code is clear on the matter.

The records are thus bereft of any showing that the university had made it clear during the CBA negotiations that it intended to source not only the salary increases but also the increases in other employee benefits from the 80% of the TIP. Absent any proof that the university’s consent was vitiated by fraud, mistake or duress, it is presumed that it entered into the CBA voluntarily, had full knowledge of the contents thereof, and was aware of its commitments under the contract.

It is axiomatic that labor laws setting employee benefits only mandate the minimum that an employer must comply with, but the latter is not proscribed from granting higher or additional benefits if it so desires, whether as an act of generosity or by virtue of company policy or a CBA, as it would appear in this case. While, in following to the letter the subject CBA provision the petitioner will, in effect, be giving more than 80% of the TIP as its personnel’s share in the tuition fee increase, the university’s remedy lies not in the Court’s invalidating the provision, but in the parties’ clarifying the same in their subsequent CBA negotiations.