FACTS: Meralco and its union MEWA renegotiated its 1992-1997 CBA insofar as the last two-year period was concerned. The Secretary of Labor assumed jurisdiction and granted the arbitral awards. There was no question that these arbitral awards were to be given retroactive effect. However, the parties dispute the reckoning period when retroaction shall commence. Meralco claims that the award should retroact only from such time that the Secretary of Labor rendered the award. The union argues should retroact to such time granted by the Secretary who has plenary and discretionary power to determine the effectivity of the arbitral award. The union cited the case of ST. Luke’s and Mindanao Terminal where the Secretary ordered the retroaction of the CBA to the date of expiration of the previous CBA.
ISSUE: When should the arbitral award retroact?
HELD: Labor laws are silent as to when an arbitral award in a labor dispute where the Secretary has assumed jurisdiction by virtue of Art. 263 (g) shall retroact. Despite the silence of the law, the Court ruled that the CBA arbitral awards granted after six months from the expiration of the last CBA shall retroact to such time agreed upon by both the employer and the employees or their union. Absent such agreement as to retroactivity, the award shall retroact to the first day after the six-month period following the expiration of the last day of the CBA should there be one. In the absence of a CBA, the Secretary’s determination of the date of effectivity as part of his discretionary powers over arbitral awards shall control.
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