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Asterion Industries, Inc., a manufacturing firm with a certified bargaining representative, is bound by a two-year Collective Bargaining Agreement from January 1, 2024 to December 31, 2025. The CBA fixes: Economic terms—daily wage 1,420 PHP; 5% cost-of-living adjustment (COLA) after 12 months; overtime pay 25% beyond 8 hours. Non-economic terms—five-day workweek; health insurance for employees and dependents; 30 days’ transfer notice. The CBA contains a clause stating that management prerogative exists but terms and conditions of employment may be altered only by mutual agreement. On August 1, 2025, due to a severe downturn, management unilaterally reduces the daily wage to 1,180 PHP; suspends the COLA for the remainder of the term; narrows health coverage to employee-only; and shifts the workweek from five days to six days, with no additional compensation. The Asterion Workers Union files complaints with the NLRC for breach of contract and unfair labor practices, seeking restoration of the CBA terms and damages. (a) Is management’s unilateral action lawful? Explain, identifying the controlling doctrine and applying it to the facts. (b) If not lawful, what remedies are available to the union and employees?

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Clara

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