FACTS:

Petitioner Cariño, the former President of the Harrison Industrial Workers' Union (Union), was accused of mismanagement by the other officers of the Union. The charges against him included conspiring with the company during the negotiation of the CBA, paying attorney's fees without receipts, unilaterally increasing membership dues, concealing the CBA, and refusing to turn over Union funds. Despite multiple invitations, petitioner failed to respond to the investigating committee and subsequently, a general membership meeting was called where the charges were discussed and the Union decided to file a petition for special election of its officers. On 5 August 1987, a general Union membership meeting was held, finding petitioner guilty and deciding to expel him from the Union and recommend his termination from employment. Petitioner was then terminated by the company and filed a complaint for illegal dismissal with the Labor Arbiter. The Labor Arbiter ordered petitioner's reinstatement, but the NLRC reversed the decision, finding that there was just cause for petitioner's dismissal.

ISSUES:

1. Whether the charges against petitioner Cariño fall within the grounds for impeachment or recall as provided in the Union's Constitution.

2. Whether petitioner Cariño was deprived of procedural due process during the impeachment or recall proceedings.

3. Whether the company acted in bad faith in summarily dismissing the workers without giving them an opportunity to present their side.

4. Whether the company disregarded the workers' right to due process, self-organization, and security of tenure.

5. Whether the grant of separation pay is warranted in this case.

6. Whether financial assistance to the dismissed employee is warranted.

RULING:

1. The charges against petitioner Cariño reasonably fall within the grounds for impeachment or recall as provided in the Union's Constitution.

2. While there were procedural lapses in the impeachment or recall proceedings, petitioner Cariño was given ample opportunity to defend himself. His failure to respond and explain his side is considered as an admission of guilt. Therefore, the lack of procedural due process was cured by the arbitration process conducted by the Labor Arbiter.

3. The company acted in bad faith in summarily dismissing the workers without giving them the benefit of a hearing. The dismissal was done hastily and without even inquiring about the cause of expulsion from the workers concerned and from the union. Hence, the company is liable for the payment of backwages.

4. The company disregarded the workers' right to due process, self-organization, and security of tenure. Dismissals must not be arbitrary and capricious, and employers should respect and protect the rights of their employees.

5. The Court dismissed the Petition for Certiorari for lack of merit. The Court modified the Decision of the National Labor Relations Commission by eliminating the grant of separation pay and imposing a penalty of P5,000.00 payable to the petitioner to be borne solidarily by the Company and the Union.

PRINCIPLES:

• Charges raised against a union officer must fall within the grounds for impeachment or recall as provided in the Union's Constitution.

• Procedural due process requires that the accused is given ample opportunity to defend himself before any impeachment or recall vote is taken.

• Failure to strictly comply with the procedural steps in the Union's Constitution may be considered non-material if there has been substantial compliance with the prescribed impeachment and recall proceedings.

• The company should reasonably satisfy itself by conducting its own inquiry to ensure that the Union's actions were not arbitrary and capricious before terminating an employee based on his expulsion from the Union.

• The power to dismiss is a normal prerogative of the employer but is not without limitations. Employers must exercise caution in terminating the services of their employees, especially when done upon the request of a labor union pursuant to a collective bargaining agreement.

• Dismissals must be done in good faith and not precipitate. Precipitate action in dismissing an employee is an indication of lack of good faith.

• An employee is entitled to be informed of the charges against him and to a reasonable opportunity to present his side in a controversy with either the company or his own union. This right is not wiped away by a union security clause or a union shop clause in a collective bargaining agreement.

• Employers must observe due process in dismissing an employee as it affects not only their position but also their means of livelihood.

• Financial assistance to a dismissed employee may be warranted in cases of financial (humanitarian) assistance.

• Granting of separation pay is not warranted in cases of dishonesty.