#Management files for compulsory arbitration & assumption of jurisdiction by DOLE Secretary
Negotiations for the amicable settlement of the imminent strike by the labor unions in Cagayan de Oro’s first university remain deadlocked as the both sides remain firm in their respective stances despite repeated attempts at conciliation.
Xavier University – Ateneo de Cagayan
Dr. Dulce Dawang, designated spokesperson of Xavier University-Ateneo de Cagayan, said the school has filed for compulsory arbitration with the National Conciliation and Mediation Board (NCMB) to have a third party determine whether the suspension of the Christmas Cash Gratuity by the university due to operating losses incurred in the previous two years is a practice or benefit.
The Xavier University Non-teaching Employees Union (XUNTELU) filed a notice of strike last 20 October 2015 over the suspension of the Christmas Cash Gratuity due to the unprecedented financial losses experienced by XU in 2015. The union unanimously voted to proceed with its strike on 22 November 2016 and started holding nightly rallies in front of the university starting Tuesday, 15 November 2016.
After five conciliation meetings, the union and the school agreed to hold one final conciliation meeting Tuesday, 22 November 2016. XUNTELU has also agreed to extend their strike ban till Wednesday, 23 November 2016.
XUNTELU is a “closed shop union” with a membership of 183, and comprises 16.4% of the 1,118 regular employees of XU in its five campuses Downtown, Macasandig and Pueblo de Oro. It is affiliated with the Associated Labor Union-Trade Union Congress of the Philippines (ALU-TUCP) and has signed a total of five collective bargaining agreements (CBAs) with XU since its inception, the latest one inked just last 19 May 2016.
Should arbitration fail to resolve the deadlock, XU has already filed a Petition for Assumption of Jurisdiction by the DOLE Secretary.
XU President Fr. Roberto C. Yap, S.J. said the CBA has a no-strike, no lockout clause and stipulates a grievance machinery before a notice of strike is filed, with subsequent arbitration should that fail, which XUTELU did not adhere to when it filed its strike notice with NCMB.
In a press statement released to local media last 18 November, XUNTELU said “WE believe that Xavier University is not losing. In their Statement of Financial Position, the following are the total comprehensive income in the following school years: 2013=239M, 2014=74M, 2015=21.9M, with retained earnings in 2015 of 4.1B.”
It further argued that the Christmas Cash Gratuity being given by XU to all its permanent employees is already a permanent benefit and covered under Article XIII of its CBA: Retention of prior and present benefits and other privileges and labor/management cooperative scheme.
Citing Section 7 of the law on labor standards, the union further argued that “on the basis of equitable considerations, long practice, agreement (e.g. CBA), and other peculiar circumstances, cash gift/bonus may become demandable and enforceable.”
“While the Christmas Cash Gift is considered a gratuity but it has been voluntarily practiced by the university for over 20 years and therefore has already ripened into a privilege or a permanent benefit, that cannot be just be withdrawn or stopped otherwise it would be a diminution of benefit.”
“There are however instances when a bonus, even though clearly an act of generosity on the part of the employer, may become demandable. In instances where the granting of a bonus has already become a long-standing practice or policy, the employer can no longer withdraw and to do so is tantamount to a diminution of benefits. This is prohibited under the Labor Code.”
But XU President Fr. Roberto C. Yap, S.J. said the union’s claims are erroneous.
“The 2016 Audited Financial Statements of Xavier University show that the correct facts are: XU had losses from school operations, -P89.7M in 2016, and -P159.4M in 2015. XU had losses in Total Comprehensive Income, -P138.7M in 2016, and -P98.5M in 2015.”
He further explained that as a non-profit foundation, XU does not have “retained earnings” but rather what are known as “fund balances” or “net assets”(assets less liabilities) which it uses to further XU’s educational mission.
The Fund Balance of XU, as of 31 May 2016 is P3.8B, was down –PhP 200 million (M) from the previous year’s Fund Balance of P4B. The 2016 Fund Balance (P3.8B) is held in the form of assets: Buildings, Land and Equipment valued at P2B and Investment Funds of P1.8B.
This Fund Balance (P3.8B) has been allocated by the XU Board of Trustees for Restricted Funds (P2.2B), which are restricted by law or by donors’ intentions for scholarships, professorial chairs, construction, plant & equipment; Required paper accounting entries (P800M), for revaluation of property, re-measurement losses, unrealized gains/losses; and, Institutional Fund (P800M), which is the “savings” which can be used to cover operational losses and deficits.
“The Institutional Fund (P800M) needs to be managed prudently to cover the expected losses of the K-12 transition years (2016-2021) when we will have no college enrollment by as much as 4,000 college students,” Fr. Yap said.
“This SY16-17 is the first of the K-12 transition years when we do not have college freshmen enrollees; next SY we will have no freshmen & no sophomores; in SY18-19 no sophomores & no juniors; in SY19-20, no juniors & no seniors; in SY20-21, no seniors.”
“The deficit of the budget for SY16-17 approved by the Board of Trustees is projected at -P199M. If the average deficit during the K-12 transition years will be -P200M, then we will deplete our savings (P800M) in 4 years, by 2020.”
In an open letter dated 18 Nov 2016 addressed to students, parents, alumni, administrator, faculty and staff, Fr. Yap presented four points regarding the issue.
“Like all gifts, the Christmas gratuity is not an obligation and our unprecedented financial losses compel us to suspend the granting of the pinaskuhan,” he noted. “Second, XU is working hard to resolve this labor dispute and avert the strike. Meantime, XU’s classes and activities will continue as normally as possible. And not the least, the safety and security of everyone is a paramount concern.”
However, XUNTELU remains adamant that XU is not losing since it offered a PhP 33-M package with everything monetized when the union was negotiating for its new CBA last February, but that the union opted for the present CBA monetized at PHP13-M, “for the best interest of the union.”
“Therefore, Xavier University has savings. And, to declare it depleted is something that cannot be accepted. XU must be transparent about it. The Gratuity thing is not the issue here anymore. It is the deliberate and intentional act committed of not giving it. To unilaterally discontinue, eliminate, reduce, and diminish a benefit that has been long enjoyed by the employees is absolutely a Diminution of Benefit in violation of Art. 100 of the Labor Code.”
In response, Fr. Yap assured the community that XU is exerting best efforts to achieve a fair resolution to this dispute.
“XU is willing to give a Christmas cash gift, but not by using the savings from the Institutional Fund because this will increase the already large deficit (-PHP 199M) and will force XU to withdraw more than necessary from the savings,” he explained. “Instead, XU has proposed to give a Christmas cash gift in 2016 by reducing certain items in the SY16-17 budget to contribute to funding the Christmas gratuity. For example, cancel the University Christmas party and contribute the budget for the Christmas cash gift. In this manner, we will not increase the deficit for SY16-17 and not have to withdraw more than necessary from our savings. And everyone in the community will help each other so all can receive something this Christmas.”
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(Disclosure: the writer is a graduate of the XU-Ateneo de Cagayan Graduate School of Business and has worked closely with ALU-TUCP in the past)