Police said Sammuel Bandilla, 45, also the Metro Tacloban coordinator of Kilusang Mayo Uno-NAFLU, and engineer Bernardo Devaras, 42, were on their way home from a picket at the LMWD compound in Barangay Mabini when they were attacked at about 9 p.m.
Bandilla was shot in the back with a caliber .45 pistol and died on the spot. Devaras, who was driving a motorcycle, was hit in the spine but was declared out of danger by doctors of the Divine Word University Hospital.
During the picket, the two lambasted the LMWD for dismissing 26 employees this week for various alleged offenses.
Chief Superintendent Dionisio Coloma, Eastern Visayas police director, said the gunmens motorcycle was found abandoned along P. Paterno street, just near the city police station.
Coloma said probers are looking into the labor dispute as behind the ambush-killing.
But engineer Eulalio Maderazo, manager of the LMWDs construction and maintenance division, told reporters in a forum that the incident had nothing to do with the picket and the dismissal of their 26 employees.
"The incident should not be attributed to the case of the dismissed employees and the rally going on outside our office. This is an isolated incident," he said.
Maderazo said the dismissal of the 26 employees and the suspension of two others were in order, saying they failed to refute the charges against them in an investigation, contrary to their claim that they were denied due process.
Engineer Ranulfo Feliciano, LMWD general manager, told The STAR in a cellphone interview that the dismissed and suspended employees can appeal the sanctions imposed on them and avail themselves of legal remedies.
Feliciano, who was in Metro Manila, denounced the incident and urged the police to arrest and prosecute the ambushers.