FACTS:

At the time material to the case, respondent, San Miguel Corporation Employees Union PTWGO (the Union), was the sole bargaining agent of all the monthly paid employees of petitioner San Miguel Foods, Incorporated (SMFI). Some employees of SMFI's Finance Department brought a grievance against Finance Manager Gideon Montesa, before SMFI Plant Operations Manager George Nava in accordance with Step 1 of the grievance machinery adopted in the Collective Bargaining Agreement (CBA) forged by SMFI and the Union. The Union sought the "review, evaluat[ion] & upgrad[ing of] all Finance staff" and promotion of Finance Manager G.Q. Montesa to other SMC affiliate[s] & subsidiaries." The grievance was subsequently elevated to Step 2. SMFI rendered a "Decision on Step 1 Grievance" stating that it was still in the process of completing the "work management review," hence, the Union's requests could not be granted. The Union then filed a complaint before the National Labor Relations Commission (NLRC), Arbitration Branch, against SMFI, its President Amadeo P. Veloso, and its Finance Manager Montesa for unfair labor practice and unjust discrimination in matters of promotion. Instead of filing a position paper as required by the Labor Arbiter, SMFI et al. filed a motion to dismiss, contending that the issues raised in the complaint were grievance issues and should be resolved in the grievance machinery or in voluntary arbitration as provided in the CBA. The Labor Arbiter initially granted SMFI et al.'s motion to dismiss, but the NLRC ordered the Labor Arbiter to continue the proceedings on the Union's complaint. SMFI et al. filed a motion for reconsideration which was denied. They then filed a petition for certiorari with the Court of Appeals, which denied the petition. SMFI brought the present petition for review on certiorari to the Supreme Court, challenging the jurisdiction of the Labor Arbiter and arguing that their alleged violation of the CBA does not constitute unfair labor practice.

ISSUES:

1. Whether the complaint of the respondent is one for unfair labor practice (ULP) over which a Labor Arbiter has jurisdiction.

2. Whether SMFI's alleged violation of the collective bargaining agreement (CBA) constitutes unfair labor practice.

RULING:

1. The Labor Arbiter has jurisdiction over the complaint of the respondent. The Court of Appeals held that the Labor Arbiter has jurisdiction over the complaint of the Union as they violated the seniority rule under the CBA by appointing and promoting certain employees, which amounted to unfair labor practice.

2. SMFI's alleged violation of the CBA constitutes unfair labor practice. The Union specified acts of unfair labor practice of SMFI under Article 248, paragraphs (e) and (i) of the Labor Code, which include discrimination in regard to wages, hours of work, and other terms and conditions of employment to discourage membership in any labor organization and violation of a collective bargaining agreement.

PRINCIPLES:

• Labor Arbiters have jurisdiction over complaints for unfair labor practices.

• Acts of unfair labor practice include discrimination in terms of employment to discourage membership in any labor organization and violation of a collective bargaining agreement.