Labor Relations Azucena Vols1 2

LABOR RELATIONS
BOOK FIVE
LABOR RELATIONS
Title I
POLICY AND DEFINITIONS
Chapter I
POLICY
Art. 211. Declaratio o! Polic".
A. It is the policy of the State:
a. To promote and emphasize the primacy of
free collective ar!ainin! and ne!otiations"
incl#din! vol#ntary aritration" mediation
and conciliation" as modes of settlin! laor
or ind#strial disp#tes$
. To promote free trade #nionism as an
instr#ment for the enhancement of
democracy and the promotion of social
%#stice and development$

c. To foster the free and vol#ntary
or!anization of a stron! and #nited laor
movement$

d. To promote the enli!htenment of &or'ers
concernin! their ri!hts and oli!ations as
#nion memers and as employees$

e. To provide an ade(#ate administrative
machinery for the e)peditio#s settlement of
laor or ind#strial disp#tes$

f. To ens#re a stale #t dynamic and %#st
ind#strial peace$ and

!. To ens#re the participation of &or'ers in
decision and policy*ma'in! processes
affectin! their ri!hts" d#ties and &elfare.

B. To enco#ra!e a tr#ly democratic method of
re!#latin! the relations et&een the employers and
employees y means of a!reements freely entered
into thro#!h collective ar!ainin!" no co#rt or
administrative a!ency or official shall have the po&er
to set or fi) &a!es" rates of pay" ho#rs of &or' or
other terms and conditions of employment" e)cept
as other&ise provided #nder this +ode. ,As
amended y Section -" Rep#lic Act No. ./01"
2arch 30" 04546
77777777
1. OVERVIE# AND VIE#POINT
8Laor Standards9 refers to the minim#m terms and
conditions of employment &hich employees are
le!ally entitled to and employers m#st comply &ith.
8Laor Relations9 refers to the interactions et&een
employer and employees or their representatives
and the mechanism y &hich the standards and
other terms and conditions of employment are
ne!otiated" ad%#sted and enforced.
The !overnment laor relations policy is declared in
Art. 300 &hich is a foc#sed elaoration of the asic
laor policy anno#nced in Art.- &hich" in t#rn"
echoes the constit#tional mandates. The policy
intends to attain social %#stice thro#!h ind#strial
peace and pro!ress. The latter is fo#nded on
employee participation and collective interactions
et&een employer and employees. In 2ana!ement
parlance" the inp#t is the parties: ri!hts and d#ties"
the process is &or'er:s or!anization and collective
ar!ainin!" and the o#tp#t is ind#strial peace and
pro!ress to&ards social %#stice as the end !oal.
;or' stoppa!e<'no&n as 8stri'e9 y employees or
8loc'o#t9 y the employer<is not favo#red in la&. It
is reco!nized as a le!al ri!ht #t re!#lated as to the
p#rpose and manner of doin! it. =eviation from the
mandatory re(#irements has adverse conse(#ences
to the violators. ;or' stoppa!e" eca#se it is
co#nter*prod#ctive" is and has to e considered a
meas#re of last resort.
The principle ehind laor #nionism in private
ind#stry is that ind#strial peace cannot e sec#red
thro#!h comp#lsion y la&. Relations et&een
private employers and their employees rest on an
essentially vol#ntary asis. S#%ect to the minim#m
re(#irements of &a!e la&s and other laor and
&elfare le!islation" the terms and conditions of
employment in the #nionized private sector are
settled thro#!h the process of collective ar!ainin!.
Beca#se laor relations are primarily 8domestic"9
third parties" even the >overnment" shy a&ay from
meddlin!" as m#ch as it can e helped. This is &hy
an in*ho#se prolem solvin! str#ct#re" called
!rievance machinery" is a re(#irement in +BAs. If
this machinery fails" the parties themselves are free
to select any third party" called vol#ntary aritrator" to
resolve their differences.
The la&s" as a force that alances the parties: ri!hts
and oli!ations" are admittedly necessary in the
ind#strial settin!.
0
2. #ORKERS$ OR%ANI&ATION
0 Art. 0/??. The relations et&een capital and laor are not
merely contract#al. They are so impressed &ith p#lic interest
that laor contracts m#st yield to the common !ood.
Art. 04. Every person m#st" in the e)ercise of his ri!hts and in the
performance of his d#ties" act &ith %#stice" !ive everyone his d#e"
and oserve honesty and !ood faith.
Az#cena" +esario Alvero @r. ,3??/6. THE LABOR CODE WITH COMMENTS AND CASES ,Aol. II6. B#ezon +ity: Re) Crintin! +ompany" Inc.
0 D C L A T O N
LABOR RELATIONS
A laor or trade #nion is a comination of &or'men
or!anized for the #ltimate p#rpose of sec#rin!
thro#!h #nited action the most favo#rale conditions
as re!ards &a!es" ho#rs of laor" conditions of
employment" etc." for its memers.
In the pop#lar sense a laor #nion is #nderstood to
e a completely or!anized ody of d#es*payin!
memers" operatin! thro#!h elected officers and
constit#tin! a militant" vital and f#nctionin! or!an. It
may e said that &hile every laor #nion is a laor
or!anization" not every laor or!anization is a laor
#nion. The difference is one of or!anization"
composition and operation.
'. #(Y #ORKERS OR%ANI&E
Self*help thro#!h economic action necessarily
re(#ires increasin! the ar!ainin! po&er of
employees$ hence one of the asic p#rposes of a
laor #nion is to eliminate competition amon!
employees in the laor mar'et.
Three other h#man desires sho#ld e noted amon!
the forces that led &or'ers to or!anize:
,06 One is the desire for %o sec#rity.
,36 Employees &ished to s#stit#te &hat &e sho#ld
term 8the r#le of la&9 for the aritrary and often
capricio#s e)ercise of po&er y the oss.
,-6 Einally" #nions helped to !ive employees a sense
of participation in the #siness enterprises of &hich
they are part<a f#nction of laor #nions &hich
ecame important as or!anizations spread into
mass prod#ction ind#stries.
The #nion is the reco!nized instr#mentality and
mo#thpiece of the laorers.
). ILO CONVENTION NO. *+
77777777
Chapter II
DEFINITIONS
Art. 212. De!iitio,.
a. F+ommissionF means the National Laor
Relations +ommission or any of its divisions" as the
case may e" as provided #nder this +ode.

. FB#rea#F means the B#rea# of Laor Relations
andGor the Laor Relations =ivisions in the re!ional
offices estalished #nder Cresidential =ecree No. 0"
in the =epartment of Laor.

c. FBoardF means the National +onciliation and
2ediation Board estalished #nder E)ec#tive Order
No. 03..

d. F+o#ncilF means the Tripartite Aol#ntary
Aritration Advisory +o#ncil estalished #nder
E)ec#tive Order No. 03." as amended.

e. FEmployerF incl#des any person actin! in the
interest of an employer" directly or indirectly. The
term shall not incl#de any laor or!anization or any
of its officers or a!ents e)cept &hen actin! as
employer.

f. FEmployeeF incl#des any person in the employ of
an employer. The term shall not e limited to the
employees of a partic#lar employer" #nless the +ode
so e)plicitly states. It shall incl#de any individ#al
&hose &or' has ceased as a res#lt of or in
connection &ith any c#rrent laor disp#te or eca#se
of any #nfair laor practice if he has not otained
any other s#stantially e(#ivalent and re!#lar
employment.

!. FLaor or!anizationF means any #nion or
association of employees &hich e)ists in &hole or in
part for the p#rpose of collective ar!ainin! or of
dealin! &ith employers concernin! terms and
conditions of employment.

h. FLe!itimate laor or!anizationF means any laor
or!anization d#ly re!istered &ith the =epartment of
Laor and Employment" and incl#des any ranch or
local thereof.

i. F+ompany #nionF means any laor or!anization
&hose formation" f#nction or administration has
een assisted y any act defined as #nfair laor
practice y this +ode.

%. FBar!ainin! representativeF means a le!itimate
laor or!anization &hether or not employed y the
employer.

'. FHnfair laor practiceF means any #nfair laor
practice as e)pressly defined y the +ode.

l. FLaor disp#teF incl#des any controversy or matter
concernin! terms and conditions of employment or
the association or representation of persons in
ne!otiatin!" fi)in!" maintainin!" chan!in! or
arran!in! the terms and conditions of employment"
re!ardless of &hether the disp#tants stand in the
pro)imate relation of employer and employee.

m. F2ana!erial employeeF is one &ho is vested &ith
the po&ers or prero!atives to lay do&n and e)ec#te
mana!ement policies andGor to hire" transfer"
s#spend" lay*off" recall" dischar!e" assi!n or
3 D C L A T O N
LABOR RELATIONS
discipline employees. S#pervisory employees are
those &ho" in the interest of the employer" effectively
recommend s#ch mana!erial actions if the e)ercise
of s#ch a#thority is not merely ro#tinary or clerical in
nat#re #t re(#ires the #se of independent
%#d!ment. All employees not fallin! &ithin any of the
aove definitions are considered ran'*and*file
employees for p#rposes of this Boo'.

n. FAol#ntary AritratorF means any person
accredited y the Board as s#ch or any person
named or desi!nated in the +ollective Bar!ainin!
A!reement y the parties to act as their Aol#ntary
Aritrator" or one chosen &ith or &itho#t the
assistance of the National +onciliation and
2ediation Board" p#rs#ant to a selection proced#re
a!reed #pon in the +ollective Bar!ainin! A!reement"
or any official that may e a#thorized y the
Secretary of Laor and Employment to act as
Aol#ntary Aritrator #pon the &ritten re(#est and
a!reement of the parties to a laor disp#te.

o. FStri'eF means any temporary stoppa!e of &or'
y the concerted action of employees as a res#lt of
an ind#strial or laor disp#te.

p. FLoc'o#tF means any temporary ref#sal of an
employer to f#rnish &or' as a res#lt of an ind#strial
or laor disp#te.

(. FInternal #nion disp#teF incl#des all disp#tes or
!rievances arisin! from any violation of or
disa!reement over any provision of the constit#tion
and y*la&s of a #nion" incl#din! any violation of the
ri!hts and conditions of #nion memership provided
for in this +ode.

r. FStri'e*rea'erF means any person &ho ostr#cts"
impedes" or interferes &ith y force" violence"
coercion" threats" or intimidation any peacef#l
pic'etin! affectin! &a!es" ho#rs or conditions of
&or' or in the e)ercise of the ri!ht of self*
or!anization or collective ar!ainin!.

s. FStri'e areaF means the estalishment"
&areho#ses" depots" plants or offices" incl#din! the
sites or premises #sed as r#na&ay shops" of the
employer str#c' a!ainst" as &ell as the immediate
vicinity act#ally #sed y pic'etin! stri'ers in movin!
to and fro efore all points of entrance to and e)it
from said estalishment. ,As amended y Section I"
Rep#lic Act No. ./01" 2arch 30" 04546
77777777
1. E-PLOYER.E-PLOYEE RELATIONS(IP
ESSENTIAL
The e)istence of employer*employee relationship" as
e)plained in Boo' III" is determined y the presence
of the follo&in! elements" namely:
,a6 selection and en!a!ement of the employee$
,6 payment of &a!es$
,c6 po&er to dismiss$ and
,d6 po&er to control the employee:s cond#ct.
The fo#rth is the most important element.
2. #(O ARE E-PLOYEES
The term 8employee9:
,06 shall incl#de any employee
,36 and shall not e limited to the employee of any
partic#lar employer" #nless the Act so e)plicitly
states other&ise
,-6 and shall incl#de any individ#al
,a6 &hose &or' has ceased as a res#lt of" or
in connection &ith any c#rrent laor disp#te
,6 and &ho has not otained any other
s#stantially e(#ivalent and re!#lar
employment.
8Employee9 refers to any person &or'in! for an
employer. It incl#des one &hose &or' has ceased in
connection &ith any c#rrent laor disp#te or eca#se
of any #nfair laor practice and one &ho has een
dismissed from &or' #t the le!ality of the dismissal
is ein! contested in a for#m of appropriate
%#risdiction.
8Employer9 refers to any person or entity &ho
employs the services of others" one for &hom
employees &or' and &ho pays their &a!es or
salaries. An employer incl#des any person directly or
indirectly actin! in the interest of an employer. It
shall also refer to the enterprise &here a laor
or!anization operates or see's to operate.
An employer may e ro#!ht into ar!ainin! and
economic relationship &ith persons not in his act#al
employ$ s#ch persons are !iven the stat#s and ti!hts
of 8employees9 in relation to him" in order to accord
to them the protection of the Act. Th#s" The nat#re of
a 8laor disp#te9 does not re(#ire that the disp#tants
sho#ld stand in the pro)imate relation of employer
and employee" &ith conse(#ent protection of
concerted activities carried o#t y many persons
elon!in! to several employers.
- D C L A T O N
LABOR RELATIONS
3.0 8One &hose &or' has ceased...9
+essation of &or' d#e to stri'e or loc'o#t" or to
dismissal or s#spensions constit#tin! #nfair laor
practices" does not in itself affect the 8employee9
stat#s" in the sense that the ri!hts and enefits of
the employee are protected as tho#!h there had
een no interr#ption of service" effective #pon act#al
ret#rn to &or'.
'. LABOR OR%ANI&ATION AS E-PLOYER
E)ceptionally" a laor or!anization may e deemed
an 8employer9 &hen it is actin! as s#ch in relation to
persons renderin! services #nder hire" partic#larly in
connection &ith its activities for profit or !ain.
). LABOR DISP/TE
The test of &hether a laor controversy comes &ithin
the definition of a laor disp#te depends on &hether
it involves or concerns terms" conditions of
employment or representation.
The e)istence of a laor disp#te is not ne!ative y
the fact that the plaintiffs and defendants do not
stand in the pro)imate relation of employer and
employee.
0. LABOR DISP/TES AND RE-EDIES1 A
S/--ARY
1.0 =efinition
8Laor =isp#te9 incl#des any controversy or matter
concernin! terms and conditions of employment or
the association or representation of persons in
ne!otiatin!" fi)in!" maintainin!" chan!in! or
arran!in! the terms and conditions of employment"
re!ardless of &hether the disp#tants stand in the
pro)imate relation of employer and employee.
1.3 Tests or +riteria of 8Laor =isp#te9
A. Nat#re: =isp#te arises from employer*employee
relationship" altho#!h disp#tants need not e
pro)imately 8employee9 or 8employer9 of the other.
B. S#%ect matter: =isp#te concerns ,06 terms or
conditions of employment$ or ,36 association or
representation of persons in ne!otiatin!" fi)in!"
maintainin!" or chan!in! terms or conditions of
employment.
1.- Jinds of Laor =isp#tes
A. Laor Standards =isp#tes:
,06 +ompensation K ,#nderpayment of minim#m
&a!e6
,36 Benefits K ,nonpayment of holiday pay6
,-6 ;or'in! conditions K ,#nrectified &or' hazards6
B. Laor Relations =isp#tes:
,06 Or!anizational Ri!ht =isp#teG HLC K ,coercion6
,36 Representation =isp#tes K ,determination of
appropriate collective ar!ainin! #nit6
,-6 Bar!ainin! =isp#tes K ,ref#sal to ar!ain6
,I6 +ontract Administration or Cersonnel Colicy
=isp#tes K ,noncompliance &ith +BA provision6
,16 Employment Ten#re =isp#tes K
,nonre!#larization of employees6
1.I Remedies in Laor =isp#tes ,SEE TABLE 16
77777777
Title II
NATIONAL LABOR RELATIONS CO--ISSION
Chapter I
CREATION AND CO-POSITION
Art. 30-. National Laor Relations +ommission.
There shall e a National Laor Relations
+ommission &hich shall e attached to the
=epartment of Laor and Employment for pro!ram
and policy coordination only" composed of a
+hairman and fo#rteen ,0I6 2emers.
Eive ,16 memers each shall e chosen from amon!
the nominees of the &or'ers and employers
or!anizations" respectively. The +hairman and the
fo#r ,I6 remainin! memers shall come from the
p#lic sector" &ith the latter to e chosen from
amon! the recommendees of the Secretary of Laor
and Employment.
Hpon ass#mption into office" the memers
nominated y the &or'ers and employers
or!anizations shall divest themselves of any
affiliation &ith or interest in the federation or
association to &hich they elon!.
The +ommission may sit en anc or in five ,16
divisions" each composed of three ,-6 memers.
S#%ect to the pen#ltimate sentence of this
para!raph" the +ommission shall sit en anc only for
p#rposes of prom#l!atin! r#les and re!#lations
!overnin! the hearin! and disposition of cases
efore any of its divisions and re!ional ranches"
I D C L A T O N
LABOR RELATIONS
and form#latin! policies affectin! its administration
and operations. The +ommission shall e)ercise its
ad%#dicatory and all other po&ers" f#nctions" and
d#ties thro#!h its divisions. Of the five ,16 divisions"
the first" second and third divisions shall handle
cases comin! from the National +apital Re!ion and
the parts of L#zon$ and the fo#rth and fifth divisions"
cases from the Aisayas and 2indanao" respectively$
Crovided that the +ommission sittin! en anc may"
on temporary or emer!ency asis" allo& cases
&ithin the %#risdiction of any division to e heard and
decided y any other division &hose doc'et allo&s
the additional &or'load and s#ch transfer &ill not
e)pose liti!ants to #nnecessary additional e)pense.
The divisions of the +ommission shall have
e)cl#sive appellate %#risdiction over cases &ithin
their respective territorial %#risdictions. LAs amended
y Rep#lic Act No. //??M.
The conc#rrence of t&o ,36 +ommissioners of a
division shall e necessary for the prono#ncement of
%#d!ment or resol#tion. ;henever the re(#ired
memership in a division is not complete and the
conc#rrence of t&o ,36 commissioners to arrive at a
%#d!ment or resol#tion cannot e otained" the
+hairman shall desi!nate s#ch n#mer of additional
+ommissioners from the other divisions as may e
necessary.
The concl#sions of a division on any case s#mitted
to it for decision shall e reached in cons#ltation
efore the case is assi!ned to a memer for the
&ritin! of the opinion. It shall e mandatory for the
division to meet for p#rposes of the cons#ltation
ordained herein. A certification to this effect si!ned
y the Cresidin! +ommissioner of the division shall
e iss#ed and a copy thereof attached to the record
of the case and served #pon the parties.
The +hairman shall e the Cresidin! +ommissioner
of the first division and the fo#r ,I6 other memers
from the p#lic sector shall e the Cresidin!
+ommissioners of the second" third" fo#rth and fifth
divisions" respectively. In case of the effective
asence or incapacity of the +hairman" the
Cresidin! +ommissioner of the second division shall
e the Actin! +hairman.
The +hairman" aided y the E)ec#tive +ler' of the
+ommission" shall have administrative s#pervision
over the +ommission and its re!ional ranches and
all its personnel" incl#din! the E)ec#tive Laor
Ariters and Laor Ariters.
The +ommission" &hen sittin! en anc shall e
assisted y the same E)ec#tive +ler' and" &hen
actin! thr# its =ivisions" y said E)ec#tive +ler's for
the second" third" fo#rth and fifth =ivisions"
respectively" in the performance of s#ch similar or
e(#ivalent f#nctions and d#ties as are dischar!ed y
the +ler' of +o#rt and =ep#ty +ler's of +o#rt of the
+o#rt of Appeals. ,As amended y Section 1"
77777777
Art. 30I. Nead(#arters" Branches and Crovincial
E)tension Hnits. The +ommission and its Eirst"
Second and Third divisions shall have their main
offices in 2etropolitan 2anila" and the Eo#rth and
Eifth divisions in the +ities of +e# and +a!ayan de
Oro" respectively. The +ommission shall estalish as
many re!ional ranches as there are re!ional offices
of the =epartment of Laor and Employment" s#*
re!ional ranches or provincial e)tension #nits.
There shall e as many Laor Ariters as may e
necessary for the effective and efficient operation of
the +ommission. Each re!ional ranch shall e
headed y an E)ec#tive Laor Ariter. ,As amended
y Section ." Rep#lic Act No. ./01" 2arch 30"
04546
77777777
1. NLRC1 NAT/RE AND OR%ANI&ATION
0.0 +reation and A#tonomy
Before the advent of the Laor +ode the laor co#rt
&as the +o#rt of Ind#strial Relations. ;hen martial
la& &as declared in Septemer 04/3" C= No. 30
,Octoer 0I" 04/36 aolished the +IR and replaced
it &ith an ad hoc National Laor Relations
+ommission. This NLR+ &as short*lived as it !ave
&ay to the NLR+ &hich the Laor +ode created in
04/I.
0.3 Administrative S#pervision =ele!ated to the
=OLE Secretary
E)ec#tive Order No. 3?I dele!ated to the Secretary
of Laor 8administrative s#pervision over the NLR+"
its re!ional ranches and all its personnel.9 The
Order cited t&o o%ectives: ,06 to f#rther improve the
rate of disposition of cases and ,36 to enhance
e)istin! meas#res for the prevention of !raft and
corr#ption in the NLR+.
0.- Essential +haracter
Hnder Rep#lic Act No. ./01 in 0454" as #nder the
former la&" the National Laor Relations
+ommission contin#es to act colle!ially" &hether it
performs administrative or r#le*ma'in! f#nctions or
e)ercises appellate %#risdiction to revie& decisions
and final orders of the Laor Ariters.
0.I Tripartite +omposition
1 D C L A T O N
LABOR RELATIONS
The same Article 30-" as amended" provides that the
+hairman and t&enty*three memers composin! the
National Laor Relations +ommission shall e
chosen from the &or'ers" employers and the p#lic
sectors.
0.1 Allocation of Co&ers Bet&een NLR+ En Banc
and Its =ivision
The 8division: is a le!al entity" not the persons &ho
sit in it. Nence" an individ#al commissioner has no
ad%#dicatory po&er" altho#!h" of co#rse" he can
conc#r or dissent in decidin! a case. The la& lod!es
the ad%#dicatory po&er on each of the ei!ht
divisions" not on the individ#al commissioners not on
the &hole commission.
0.. The NLR+ R#les of Croced#re
8The 3??1 Revised R#les of Croced#re of the
National Laor Relations +ommission9 &as
p#lished in ne&spapers on =ecemer 3-" 3??1 and
too' effect on @an#ary /" 3??..
77777777
Art. 301. Appointment and B#alifications. The
+hairman and other +ommissioners shall e
memers of the Chilippine Bar and m#st have
en!a!ed in the practice of la& in the Chilippines for
at least fifteen ,016 years" &ith at least five ,16 years
e)perience or e)pos#re in the field of laor*
mana!ement relations" and shall preferaly e
residents of the re!ion &here they are to hold office.
The E)ec#tive Laor Ariters and Laor Ariters
shall li'e&ise e memers of the Chilippine Bar and
m#st have een en!a!ed in the practice of la& in the
Chilippines for at least seven ,/6 years" &ith at least
three ,-6 years e)perience or e)pos#re in the field of
laor*mana!ement relations: Crovided" No&ever"
that inc#ment E)ec#tive Laor Ariters and Laor
Ariters &ho have een en!a!ed in the practice of
la& for at least five ,16 years may e considered as
already (#alified for p#rposes of reappointment as
s#ch #nder this Act. The +hairman and the other
+ommissioners" the E)ec#tive Laor Ariters and
Laor Ariters shall hold office d#rin! !ood ehavior
#ntil they reach the a!e of si)ty*five years" #nless
sooner removed for ca#se as provided y la& or
ecome incapacitated to dischar!e the d#ties of their
office.
The +hairman" the division Cresidin!
+ommissioners and other +ommissioners shall e
appointed y the Cresident" s#%ect to confirmation
y the +ommission on Appointments. Appointment
to any vacancy shall come from the nominees of the
sector &hich nominated the predecessor. The
E)ec#tive Laor Ariters and Laor Ariters shall
also e appointed y the Cresident" #pon
recommendation of the Secretary of Laor and
Employment and shall e s#%ect to the +ivil Service
La&" r#les and re!#lations.
The Secretary of Laor and Employment shall" in
cons#ltation &ith the +hairman of the +ommission"
appoint the staff and employees of the +ommission
and its re!ional ranches as the needs of the service
may re(#ire" s#%ect to the +ivil Service La&" r#les
and re!#lations" and #p!rade their c#rrent salaries"
enefits and other emol#ments in accordance &ith
la&. ,As amended y Section /" Rep#lic Act No.
./01" 2arch 30" 04546
77777777
RE2/IRIN% CONFIR-ATION BY CO--ISSION
ON APPOINT-ENTS3 /NCONSTIT/TIONAL
77777777
Art. 30.. Salaries" enefits and other emol#ments.
The +hairman and memers of the +ommission
shall receive an ann#al salary at least e(#ivalent to"
and e entitled to the same allo&ances and enefits
as those of the Cresidin! @#stice and Associate
@#stices of the +o#rt of Appeals" respectively. The
E)ec#tive Laor Ariters shall receive an ann#al
salary at least e(#ivalent to that of an Assistant
Re!ional =irector of the =epartment of Laor and
Employment and shall e entitled to the same
allo&ances and enefits as that of a Re!ional
=irector of said =epartment. The Laor Ariters shall
receive an ann#al salary at least e(#ivalent to" and
e entitled to the same allo&ances and enefits as
that of an Assistant Re!ional =irector of the
=epartment of Laor and Employment. In no case"
ho&ever" shall the provision of this Article res#lt in
the dimin#tion of e)istin! salaries" allo&ances and
enefits of the aforementioned officials.,As amended
y Section 5" Rep#lic Act No. ./01" 2arch 30"
04546
77777777
Chapter II
PO#ERS AND D/TIES
Art. 30/. @#risdiction of the Laor Ariters and the
+ommission.
a. E)cept as other&ise provided #nder this +ode"
the Laor Ariters shall have ori!inal and e)cl#sive
%#risdiction to hear and decide" &ithin thirty ,-?6
calendar days after the s#mission of the case y
the parties for decision &itho#t e)tension" even in
the asence of steno!raphic notes" the follo&in!
cases involvin! all &or'ers" &hether a!ric#lt#ral or
non*a!ric#lt#ral:

0. Hnfair laor practice cases$

3. Termination disp#tes$
. D C L A T O N
LABOR RELATIONS

-. If accompanied &ith a claim for
reinstatement" those cases that &or'ers
may file involvin! &a!es" rates of pay" ho#rs
of &or' and other terms and conditions of
employment$

I. +laims for act#al" moral" e)emplary and
other forms of dama!es arisin! from the
employer*employee relations$

1. +ases arisin! from any violation of Article
3.I of this +ode" incl#din! (#estions
involvin! the le!ality of stri'es and loc'o#ts$
and

.. E)cept claims for Employees
+ompensation" Social Sec#rity" 2edicare
and maternity enefits" all other claims
arisin! from employer*employee relations"
incl#din! those of persons in domestic or
ho#sehold service" involvin! an amo#nt
e)ceedin! five tho#sand pesos ,C1"???.??6
re!ardless of &hether accompanied &ith a
claim for reinstatement.

. The +ommission shall have e)cl#sive appellate
%#risdiction over all cases decided y Laor Ariters.

c. +ases arisin! from the interpretation or
implementation of collective ar!ainin! a!reements
and those arisin! from the interpretation or
enforcement of company personnel policies shall e
disposed of y the Laor Ariter y referrin! the
same to the !rievance machinery and vol#ntary
aritration as may e provided in said a!reements.
,As amended y Section 4" Rep#lic Act No. ./01"
2arch 30" 04546
77777777
1. ADDITIONAL CASES
To the si) ,.6 'inds of cases mentioned in Article
30/" the follo&in! sho#ld e added:
0. 2oney claims arisin! o#t of employer*employee
relationship or y virt#e of any la& or contract"
involvin! Eilipino &or'ers for overseas deployment"
incl#din! claims for act#al" moral" e)emplary and
other forms of dama!es" as &ell as employment
termination of OE;s$
3. ;a!e distortion disp#tes in #nor!anized
estalishments not vol#ntarily settled y the parties
p#rs#ant to Rep#lic Act No. ./3/" as reflected in
Article 03I$
-. Enforcement of compromise a!reements &hen
there is non*compliance y any of the parties
p#rs#ant to Article 33/ of the Laor +ode" as
amended$ and
I. Other cases as may e provided y la&.
2. CO-P/LSORY ARBITRATION BY LABOR
ARBITERS
In its road sense" aritration is the reference of a
disp#te to an impartial third person" chosen y the
parties or appointed y stat#tory a#thority to hear
and decide the case in controversy. ;hen the
consent of one of the parties is enforced y stat#tory
provisions" the proceedin! is referred to as
comp#lsory aritration. In laor cases" comp#lsory
aritration is the process of settlement of laor
disp#tes y a !overnment a!ency &hich has the
a#thority to investi!ate and to ma'e an a&ard &hich
is indin! on all the parties.
3.0 NLR+ Appellate Croceedin!s Not Cart of
Aritration
Hnder the Laor +ode" it is the Laor Ariter &ho is
clothed &ith the a#thority to cond#ct comp#lsory
aritration on cases involvin! termination disp#tes
and other cases #nder Art. 30/.
;hen the Laor Ariter renders his decision"
comp#lsory aritration is deemed terminated
eca#se y then the hearin! and determination of
the controversy has ended.
3.3 Nat#re of Croceedin!s
The NLR+ R#les descrie the proceedin!s efore
the Laor Ariter as non*liti!io#s. S#%ect to the
re(#irements of d#e process" the technicalities of
la& and proced#re in the re!#lar co#rts do not apply
in NLR+Glaor ariter proceedin!s ,Art. 3306. The
ariter may avail himself of all reasonale means"
incl#din! oc#lar inspection" to ascertain the facts
speedily$ he shall personally cond#ct the conference
or hearin!s and ta'e f#ll control of the proceedin!s.
,R#le A" Sec. 3" NLR+ 3??1 R#les of Croced#re6
3.- Article 30/ Oields to Arts. 3.0
3
and 3.3
-
'. LABOR ARBITER$S 4/RISDICTION3 IN
%ENERAL
3 A vol#ntary aritrator" #nder Art. 3.0" has 8ori!inal and
e)cl#sive9 %#risdiction over disp#tes concernin! +BA
implementation or personnel policy enforcement.
- In addition" #nder Art. 3.3" the parties may s#mit to a vol#ntary
aritrator ,or panel6 8all other disp#tes incl#din! #nfair laor
practices and ar!ainin! deadloc's.
/ D C L A T O N
LABOR RELATIONS
The cases laor ariter can hear and decide are
employment*related.
-.0 S#pervisory +ontrol" +r#cial
+ontrol over the performance of the &or' is the
cr#cial indicator of employment relationship" &itho#t
&hich the laor ariter has no %#risdiction over the
disp#te.
It is &ell*settled in la& and %#rispr#dence that &here
no employer*employee relationship e)ists et&een
the parties and no iss#e is involved &hich may e
resolved y reference to the Laor +ode" other laor
stat#tes" or any collective ar!ainin! a!reement" it is
the Re!ional Trial +o#rt that has %#risdiction.
). VEN/E
The NLR+ R#les of Croced#re provides:
Section 0. Aen#e. * a6 All cases &hich Laor Ariters have
a#thority to hear and decide may e filed in the Re!ional
Aritration Branch havin! %#risdiction over the &or'place
of the complainant or petitioner.
Eor p#rposes of ven#e" the &or'place shall e #nderstood
as the place or locality &here the employee is re!#larly
assi!ned at the time the ca#se of action arose. It shall
incl#de the place &here the employee is s#pposed to
report ac' after a temporary detail" assi!nment" or travel.
In case of field employees" as &ell as am#lant or itinerant
&or'ers" their &or'place is &here they are re!#larly
assi!ned" or &here they are s#pposed to re!#larly receive
their salaries and &a!es or &or' instr#ctions from" and
report the res#lts of their assi!nment to" their employers.
6 ;here t&o ,36 or more Re!ional Aritration Branches
have %#risdiction over the &or'place of the complainant or
petitioner" the Branch that first ac(#ired %#risdiction over
the case shall e)cl#de the others.
c6 ;hen ven#e is not o%ected to efore the fillin! of
position papers s#ch iss#e shall e deemed &aived.
d6 The ven#e of an action may e chan!ed or transferred
to a different Re!ional Aritration Branch other than &here
the complaint &as filed y &ritten a!reement of the parties
or &hen the +ommission or Laor Ariter efore &hom the
case is pendin! so orders" #pon motion y the proper
party in meritorio#s cases.
e6 +ases involvin! overseas Eilipino &or'ers may e filed
efore the Re!ional Aritration Branch havin! %#risdiction
over the place &here the complainant resides or &here the
principal office of any of the respondents is sit#ated" at the
option of the complainant.
I.0 ;or'er:s Option
The &or'er" ein! the economically*disadvanta!ed
party<&hether as complainantGpetitioner or as
respondent" as the case may e<the nearest
!overnmental machinery to settle the disp#te m#st
e placed at his immediate disposal.
I.3 ;aiver
The 3??1 NLR+ R#les" in Sec. 0,c6" R#le IA states:
8;hen ven#e is not o%ected to efore the fillin! of
position papers s#ch iss#e shall e deemed &aived.9
0. LABOR ARBITER$S 4/RISDICTION1 /.L.P.
CASES
B#t its essence" capt#red in Art. 3I." is any act
intended or directed to &ea'en or defeat the
&or'er:s ri!hts to self*or!anize or to en!a!e in la&f#l
concerted activities. In short" #nfair laor practice"
&hen committed y an employer" carries the effect of
anti*#nionism.
5. CBA VIOLATION A-O/NTIN% TO /LP
+ertainly" violations of the collective ar!ainin!
a!reement &o#ld e #nfair laor practice &hich falls
#nder the %#risdiction of the Laor Ariters and the
National Laor Relations +ommission.
+. LABOR ARBITER$S 4/RISDICTION1
TER-INATION DISP/TES
Termination disp#tes or ille!al dismissal complaints
fall &ithin the %#risdiction of a laor ariter" as stated
in Art. 30/,36.
/.0 Termination of +orporate Officer$ @#risdiction
over Intra*+orporate =isp#tes Transferred from SE+
to RT+
The dismissal of a corporate officer y a corporate
oard is a corporate disp#te that sho#ld e ro#!ht
to the re!#lar co#rts.
A corporate officer:s dismissal is al&ays a corporate
act" or an e)tra*corporate controversy and the nat#re
is not altered y the reason or &isdom &ith &hich
the Board of =irectors may have in ta'in! s#ch
action.
/.3 Effect of +laim for Bac'&a!es" Benefits" or
=ama!es
In intra*corporate matters" s#ch as those affectin!
the corporation" its directors" tr#stees" officers and
shareholders" the iss#e of conse(#ential dama!es
may %#st as &ell e resolved and ad%#dicated y the
SE+. Hndo#tedly" it is still &ithin the competence
and e)pertise of the SE+ to resolve all matters
arisin! from or closely connected &ith all intra*
corporate disp#tes.
5 D C L A T O N
LABOR RELATIONS
/.- 2ainland v. 2ovilla: The 8Better Colicy9 in
=eterminin! SE+ @#risdiction
The etter policy to e follo&ed in determinin!
%#risdiction over a case sho#ld e to consider
conc#rrent factors s#ch as the stat#s or relationship
of the parties or the nat#re of the (#estion that is the
s#%ect of their controversy.
/.I Taan! v. NLR+: SE+ @#risdiction Reaffirmed$
+orporate Officer and Intra*corporate +ontroversy
=efined
An 8intra*corporate controversy9 is one &hich arises
et&een a stoc'holder and the corporation. There is
no distinction" (#alification" nor any e)emption
&hatsoever. The provision is road and covers all
'inds of controversies et&een stoc'holders and
corporations.
*. LABOR ARBITER$S 4/RISDICTION1 -ONEY
CLAI-S
A money claim arisin! from employer*employee
relations" e)ceptin! SSSGE++G2edicare claims" is
&ithin the %#risdiction of a laor ariter<
0. if the claim" re!ardless of amo#nt" is accompanied
&ith a claim for reinstatement$ or
3. if the claim" &hether or not accompanied &ith a
claim for reinstatement" e)ceeds five tho#sand
pesos ,C1"???.??6 per claimant.
5.0 Only 2oney +laims Not Arisin! from +BA
The Aol#ntary Aritrator or Canel of Aol#ntary
Aritrators &ill have ori!inal and e)cl#sive
%#risdiction over money claims Farisin! from the
interpretation or implementation of the +ollective
Bar!ainin! A!reement and" those arisin! from the
interpretation or enforcement of company personnel
policiesF" #nder Article 3.0.
5.3 2oney +laims 2#st Nave Arisen from
Employment
2oney claims of &or'ers &hich do not arise o#t of or
in connection &ith their employer*employee
relationship fall &ithin the !eneral %#risdiction of
re!#lar co#rts of %#stice.
;here the claim to the principal relief so#!ht is to e
resolved not y reference to the Laor +ode or other
laor relations stat#te or a collective ar!ainin!
a!reement #t y the !eneral civil la&" the
%#risdiction over the disp#te elon!s to the re!#lar
co#rts of %#stice and not to the Laor Ariter and the
National Laor Relations +ommission.
5.- 2oney +laims of +oop Employees
5.I @#risdiction over +laims for =ama!es
2oney claims of &or'ers &hich the laor ariter has
ori!inal and e)cl#sive %#risdiction are comprehensive
eno#!h to incl#de claims for moral dama!es of a
dismissed employee a!ainst his employer.
5.1 Splittin! of Actions Not Allo&ed
An employee &ho has een ille!ally dismissed so as
to ca#se him moral dama!es has a ca#se of action
for reinstatement" ac' &a!es and dama!es. ;hen
he instit#tes proceedin!s efore the Laor Ariter"
he sho#ld ma'e a claim for all said reliefs.
5.. Employer:s +omplaint for =ama!es
An employer:s claim for dama!es a!ainst an
employee may e filed as co#nterclaim in the ille!al
dismissal case filed y the employee. S#ch claim for
dama!es" arisin! from employment relationship" is
o#tside the %#risdiction of the re!#lar co#rt.
6. LABOR ARBITER$S 4/RISDICTION1 STRIKE
AND LOCKO/TS
B#estions relatin! to stri'es or loc'o#ts or any form
of &or' stoppa!e incl#din! incidents thereof #nder
Art. 3.I fall &ithin the laor ariter:s %#risdiction.
B#t the po&er to iss#e in%#nction is lod!ed &ith an
NLR+ division" not a laor ariter. 2oreover"
8national interest: cases are handled differently. Art.
3.- ,!6 empo&ers the =OLE Secretary or the
Cresident of the Rep#lic to ass#me %#risdiction or
refer the case to the NLR+ if the laor disp#te or
impendin! stri'e or loc'o#t involves an ind#stry
indispensile to national interest.
Still another limit to the ariter:s %#risdiction is the
%#risdiction of the re!#lar co#rts to hear and decide
actions filed y third parties ein! affected y a
stri'e of people &ho are not their employees. Einally"
if a crime is committed" &hether in relation to a stri'e
or not" the prosec#tion of the crime has to e done
not efore a laor ariter #t a re!#lar co#rt"
eca#se in s#ch a case the la&s to e administered
are primarily the penal la&s of the land.
17. LABOR ARBITER$S 4/RISDICTION1 OF#$S
-ONEY CLAI-S OR DIS-ISSAL
Section 0? of RA 5?I3" approved on @#ne /" 0441"
'no&n as the 2i!rant ;or'ers and Overseas
Eilipinos Act of 0441" transfers from the COEA to
Laor Ariters the ori!inal and e)cl#sive %#risdiction
4 D C L A T O N
LABOR RELATIONS
to hear and decide claims arisin! o#t of an
employer*employee relationship or y virt#e of any
la& or contract involvin! Eilipino &or'ers for
overseas deployment" incl#din! claims for act#al"
moral" e)emplary and other forms of dama!es.
Based on LArticle 30/" Laor +ode and Section 0?"
R.A. No. 5?I3M" laor ariters" clearly have original
and exclui!e %#risdiction over claims arisin! from
employer*employee relations" incl#din! "er#ina"ion
di$u"e involvin! all &or'ers" amon! them &hom
are Overseas Eilipino ;or'ers ,OE;6.
11. LABOR ARBITER$S 4/RISDICTION1 #%AE
DISTORTION
A salary distortion case" referred to in the Article 03I"
is resolved either thro#!h the +BA mechanism or" in
#nor!anized estalishments" thro#!h the N+2B. IE
the N+2B fails to resolve the disp#te in ten days of
conciliation conferences" it shall e final to the
appropriate ranch of the NLR+.
12. LABOR ARBITER$S 4/RISDICTION1
DISP/TES OVER CO-PRO-ISE SETTLE-ENTS
Beca#se laor la& policy enco#ra!es vol#ntary
resol#tion of disp#tes" compromise settlements are
ordinarily final and indin! #pon the parties. B#t a
compromise settlement may itself ecome the
s#%ect of disp#te. If there is noncompliance &ith the
compromise a!reement or if there is $ri#a %acie
evidence that the settlement &as otained thro#!h
fra#d" misrepresentation" or coercion" then"
accordin! to Article 33/" the NLR+ thro#!h the laor
ariter may ass#me %#risdiction over s#ch disp#te.
1'. S/B-ISSION TO 4/RISDICTION
The active participation of the party a!ainst &hom
the action &as ro#!ht co#pled &ith his fail#re to
o%ect to the %#risdiction of the +o#rt or (#asi*%#dicial
ody &here the action is pendin!" is tantamo#nt to
an invocation of that %#risdiction" and a &illin!ness to
aide y the resol#tion of the case &ill ar said party
from later on imp#!nin! the co#rt or ody:s
%#risdiction.
The S#preme +o#rt fro&ns #pon the #ndesirale
practice of a party s#mittin! his case for decision
and then acceptin! the %#d!ment only if favo#rale"
and attac'in! it for lac' of %#risdiction &hen adverse.
1). I--/NITY OF FOREI%N %OVERN-ENTS
In international la&" Fimm#nityF is commonly
#nderstood as an e)emption of the state and its
or!ans from the %#dicial %#risdiction of another state.
This is anchored on the principle of the soverei!n
e(#ality of states #nder &hich one state cannot
assert %#risdiction over another in violation of the
ma)im $ar in $are# non ha&e" i#$eriu# ,an e(#al
has no po&er over an e(#al6.
As it stands no&" the application of the doctrine of
imm#nity from s#it has een restricted to soverei!n
or !overnmental activities ,'ure i#$erii6. The mantle
of state imm#nity cannot e e)tended to commercial"
private and proprietary acts ,'ure ge"ioni6.
0I.0 Imm#nity of the HN and Its Specialized
A!encies
10. E8EC/TIN% -ONEY CLAI-S A%AINST T(E
%OVERN-ENT
Even &hen a !overnment a!ency enters into a
#siness contract &ith a private entity" it is not the
Laor +ode #t +.A. No. -3/ that applies in
p#rs#in! a money claim ,a!ainst the >overnment6
arisin! from s#ch contract.
15. LOCAL #ATER DISTRICT
They are (#asi p#lic corporations &hose
employees elon! to the civil service" hence" the
dismissal of those employees shall e !overned y
the civil service la&" r#les and re!#lations.
0..0 E)ception: ;here NLR+ @#risdiction is Invo'ed
1+. REP/BLIC ACT NO. 5+109RETROACTIVE:
77777777
Art. 305. Co&ers of the +ommission. The
+ommission shall have the po&er and a#thority:
a. To prom#l!ate r#les and re!#lations !overnin! the
hearin! and disposition of cases efore it and its
re!ional ranches" as &ell as those pertainin! to its
internal f#nctions and s#ch r#les and re!#lations as
may e necessary to carry o#t the p#rposes of this
+ode$ ,As amended y Section 0?" Rep#lic Act No.
./01" 2arch 30" 04546

. To administer oaths" s#mmon the parties to a
controversy" iss#e s#poenas re(#irin! the
attendance and testimony of &itnesses or the
prod#ction of s#ch oo's" papers" contracts"
records" statement of acco#nts" a!reements" and
others as may e material to a %#st determination of
the matter #nder investi!ation" and to testify in any
investi!ation or hearin! cond#cted in p#rs#ance of
this +ode$

c. To cond#ct investi!ation for the determination of a
(#estion" matter or controversy &ithin its %#risdiction"
proceed to hear and determine the disp#tes in the
asence of any party thereto &ho has een
0? D C L A T O N
LABOR RELATIONS
s#mmoned or served &ith notice to appear" cond#ct
its proceedin!s or any part thereof in p#lic or in
private" ad%o#rn its hearin!s to any time and place"
refer technical matters or acco#nts to an e)pert and
to accept his report as evidence after hearin! of the
parties #pon d#e notice" direct parties to e %oined in
or e)cl#ded from the proceedin!s" correct" amend"
or &aive any error" defect or irre!#larity &hether in
s#stance or in form" !ive all s#ch directions as it
may deem necessary or e)pedient in the
determination of the disp#te efore it" and dismiss
any matter or refrain from f#rther hearin! or from
determinin! the disp#te or part thereof" &here it is
trivial or &here f#rther proceedin!s y the
+ommission are not necessary or desirale$ and

d. To hold any person in contempt directly or
indirectly and impose appropriate penalties therefor
in accordance &ith la&.
A person !#ilty of misehavior in the presence of or
so near the +hairman or any memer of the
+ommission or any Laor Ariter as to ostr#ct or
interr#pt the proceedin!s efore the same" incl#din!
disrespect to&ard said officials" offensive
personalities to&ard others" or ref#sal to e s&orn"
or to ans&er as a &itness or to s#scrie an affidavit
or deposition &hen la&f#lly re(#ired to do so" may
e s#mmarily ad%#d!ed in direct contempt y said
officials and p#nished y fine not e)ceedin! five
h#ndred pesos ,C1??6 or imprisonment not
e)ceedin! five ,16 days" or oth" if it e the
+ommission" or a memer thereof" or y a fine not
e)ceedin! one h#ndred pesos ,C0??6 or
imprisonment not e)ceedin! one ,06 day" or oth" if it
e a Laor Ariter.

The person ad%#d!ed in direct contempt y a Laor
Ariter may appeal to the +ommission and the
e)ec#tion of the %#d!ment shall e s#spended
pendin! the resol#tion of the appeal #pon the filin!
y s#ch person of a ond on condition that he &ill
aide y and perform the %#d!ment of the
+ommission sho#ld the appeal e decided a!ainst
him. @#d!ment of the +ommission on direct
contempt is immediately e)ec#tory and
#nappealale. Indirect contempt shall e dealt &ith
y the +ommission or Laor Ariter in the manner
prescried #nder R#le /0 of the Revised R#les of
+o#rt$ and ,As amended y Section 0?" Rep#lic Act
No. ./01" 2arch 30" 04546

e. To en%oin or restrain any act#al or threatened
commission of any or all prohiited or #nla&f#l acts
or to re(#ire the performance of a partic#lar act in
any laor disp#te &hich" if not restrained or
performed forth&ith" may ca#se !rave or irreparale
dama!e to any party or render ineffect#al any
decision in favor of s#ch party: Crovided" That no
temporary or permanent in%#nction in any case
involvin! or !ro&in! o#t of a laor disp#te as defined
in this +ode shall e iss#ed e)cept after hearin! the
testimony of &itnesses" &ith opport#nity for cross*
e)amination" in s#pport of the alle!ations of a
complaint made #nder oath" and testimony in
opposition thereto" if offered" and only after a findin!
of fact y the +ommission" to the effect:

0. That prohiited or #nla&f#l acts have
een threatened and &ill e committed and
&ill e contin#ed #nless restrained" #t no
in%#nction or temporary restrainin! order
shall e iss#ed on acco#nt of any threat"
prohiited or #nla&f#l act" e)cept a!ainst the
person or persons" association or
or!anization ma'in! the threat or committin!
the prohiited or #nla&f#l act or act#ally
a#thorizin! or ratifyin! the same after act#al
'no&led!e thereof$

3. That s#stantial and irreparale in%#ry to
complainant:s property &ill follo&$

-. That as to each item of relief to e
!ranted" !reater in%#ry &ill e inflicted #pon
complainant y the denial of relief than &ill
e inflicted #pon defendants y the !rantin!
of relief$

I. That complainant has no ade(#ate
remedy at la&$ and

1. That the p#lic officers char!ed &ith the
d#ty to protect complainant:s property are
#nale or #n&illin! to f#rnish ade(#ate
protection.

S#ch hearin! shall e held after d#e and personal
notice thereof has een served" in s#ch manner as
the +ommission shall direct" to all 'no&n persons
a!ainst &hom relief is so#!ht" and also to the +hief
E)ec#tive and other p#lic officials of the province or
city &ithin &hich the #nla&f#l acts have een
threatened or committed" char!ed &ith the d#ty to
protect complainant:s property: Crovided" ho&ever"
that if a complainant shall also alle!e that" #nless a
temporary restrainin! order shall e iss#ed &itho#t
notice" a s#stantial and irreparale in%#ry to
complainant:s property &ill e #navoidale" s#ch a
temporary restrainin! order may e iss#ed #pon
testimony #nder oath" s#fficient" if s#stained" to
%#stify the +ommission in iss#in! a temporary
in%#nction #pon hearin! after notice. S#ch a
temporary restrainin! order shall e effective for no
lon!er than t&enty ,3?6 days and shall ecome void
at the e)piration of said t&enty ,3?6 days. No s#ch
temporary restrainin! order or temporary in%#nction
shall e iss#ed e)cept on condition that complainant
00 D C L A T O N
LABOR RELATIONS
shall first file an #nderta'in! &ith ade(#ate sec#rity
in an amo#nt to e fi)ed y the +ommission
s#fficient to recompense those en%oined for any loss"
e)pense or dama!e ca#sed y the improvident or
erroneo#s iss#ance of s#ch order or in%#nction"
incl#din! all reasonale costs" to!ether &ith a
reasonale attorney:s fee" and e)pense of defense
a!ainst the order or a!ainst the !rantin! of any
in%#nctive relief so#!ht in the same proceedin! and
s#se(#ently denied y the +ommission.

The #nderta'in! herein mentioned shall e
#nderstood to constit#te an a!reement entered into
y the complainant and the s#rety #pon &hich an
order may e rendered in the same s#it or
proceedin! a!ainst said complainant and s#rety"
#pon a hearin! to assess dama!es" of &hich
hearin!" complainant and s#rety shall have
reasonale notice" the said complainant and s#rety
s#mittin! themselves to the %#risdiction of the
+ommission for that p#rpose. B#t nothin! herein
contained shall deprive any party havin! a claim or
ca#se of action #nder or #pon s#ch #nderta'in! from
electin! to p#rs#e his ordinary remedy y s#it at la&
or in e(#ity: Crovided" f#rther" That the reception of
evidence for the application of a &rit of in%#nction
may e dele!ated y the +ommission to any of its
Laor Ariters &ho shall cond#ct s#ch hearin!s in
s#ch places as he may determine to e accessile
to the parties and their &itnesses and shall s#mit
thereafter his recommendation to the +ommission.
,As amended y Section 0?" Rep#lic Act No. ./01"
2arch 30" 04546
77777777
Art. 304. Oc#lar inspection. The +hairman" any
+ommissioner" Laor Ariter or their d#ly a#thorized
representatives" may" at any time d#rin! &or'in!
ho#rs" cond#ct an oc#lar inspection on any
estalishment" #ildin!" ship or vessel" place or
premises" incl#din! any &or'" material" implement"
machinery" appliance or any o%ect therein" and as'
any employee" laorer" or any person" as the case
may e" for any information or data concernin! any
matter or (#estion relative to the o%ect of the
investi!ation.
77777777
1. PO#ERS OF T(E CO--ISSION
0.0 R#le*2a'in! Co&er
The +ommission has the po&er to prom#l!ate r#les
and re!#lations:
a6 !overnin! the hearin! and disposition of cases
efore it and its re!ional ranches$
6 pertainin! to its internal f#nctions$ and
c6 those that may e necessary to carry o#t the
p#rposes of this +ode.
It is an elementary r#le in administrative la& that
administrative re!#lations and policies enacted y
administrative odies" s#ch as the Revised R#les of
the NLR+" to interpret the la& &hich they are
entr#sted to enforce" have the force of la&" and are
entitled to !reat respect.
0.3 Co&er to Iss#e +omp#lsory Crocesses
The +ommission has the po&er to:
a6 administer oaths$
6 s#mmon parties$ and
c6 iss#e s#poenas ad "e"i%icandu# and duce
"ecu#.
0.- Co&er to Investi!ate and Near =isp#tes &ithin
Its @#risdiction
The +ommission has the po&er to:
a6 cond#ct investi!ation for the determination of a
(#estion" matter or controversy &ithin its %#risdiction$
and
6 proceed to hear and determine the disp#tes in the
manner laid do&n #nder para!raph ,c6 of Art. 305.
0.I +ontempt Co&er
+ontempt is defined as a disoedience to the +o#rt
y settin! #p an opposition to its a#thority" %#stice
and di!nity. It si!nifies not only a &illf#l disre!ard or
disoedience of the co#rtPs orders #t s#ch cond#ct
as tends to rin! the a#thority of the co#rt and the
administration of la& into disrep#te or in some
manner to impede the d#e administration of %#stice.
0.1 Co&er to +ond#ct Oc#lar Inspection
Hnder Article 304" the +hairman" any +ommissioner"
Laor Ariter or their d#ly a#thorized
representatives" may" at any time d#rin! &or'in!
ho#rs:
a6 cond#ct an oc#lar inspection on any
estalishment" #ildin!" ship or vessel" place or
premises" incl#din! any &or'" material" implement"
machinery" appliance or any o%ect therein$ and
6 as' any employee" laorer" or any person" as the
case may e" for any information or data concernin!
03 D C L A T O N
LABOR RELATIONS
any matter or (#estion relative to the o%ect of the
investi!ation.
0.. Ad%#dicatory Co&er: Ori!inal
The NLR+ has ori!inal %#risdiction over petitions for
in%#nction or temporary restrainin! order #nder Art.
305,e6.
Also" it has ori!inal %#risdiction to hear and decide
8National Interest9 cases certified to it y the
Secretary of Laor #nder Art. 3.-,!6.
0./ Ad%#dicatory Co&er: Appellate
The NLR+ has e)cl#sive appellate %#risdiction over
all cases decided y laor ariters ,Art. 30/LM6 and
the =OLE re!ional director or hearin! officers #nder
Art. 034.
The NLR+ has no appellate %#risdiction over
decisions rendered y ,06 a vol#ntary aritrator" or
,36 the secretary of laor" or ,-6 the #rea# of laor
relations director on cases appealed from the =OLE
re!ional offices. The decisions of these three offices
are appealale rather to the +o#rt of Apeals.
;here the laor ariter has no %#risdiction or has not
ac(#ired %#risdiction" neither has the NLR+. Its
%#risdiction over cases #nder Art. 30/,a6 is appellate"
not ori!inal.
2. PO#ER TO ISS/E IN4/NCTION OR
TE-PORARY RESTRAININ% ORDER
The NLR+ has in%#nction po&er or" simply" the
po&er to command that an act e done or not done.
The action for in%#nction is distinct from the ancillary
remedy of preliminary in%#nction
I
&hich cannot e)ist
e)cept only as part or an incident of an independent
action or proceedin!.
A &rit of preliminary in%#nction is !enerally ased
solely on initial and incomplete evidence.
3.0 In%#nction y Laor Ariter
Article 305 limits the !rant of in%#nctive po&er to the
8+ommission9 meanin! the +ommission en &anc or
any of its divisions.
3.3 Re(#isites for Iss#ance of Restrainin! Order or
In%#nction
I The sole o%ect of &hich is to preserve the stat#s (#o #ntil the
merits can e heard.
As a r#le" restrainin! orders or in%#nctions do not
iss#e ex $ar"e and only after compliance &ith the
follo&in! re(#isites" to &it:
a6 a hearin! held Fafter d#e and personal notice
thereof has een served" in s#ch manner as the
+ommission shall direct" to all 'no&n persons
a!ainst &hom relief is so#!ht" and also to the +hief
E)ec#tive and other p#lic officials of the province or
city &ithin &hich the #nla&f#l acts have een
threatened or committed char!ed &ith the d#ty to
protect complainantPs property$F
6 reception at the hearin! of Ftestimony of
&itnesses" &ith opport#nity for cross*e)amination" in
s#pport of the alle!ations of a complaint made #nder
oath"F as &ell as Ftestimony in opposition thereto" if
offered ) )$
c6 8a findin! of fact y the +ommission" to the effect:
,06 That prohiited or #nla&f#l acts have een
threatened and &ill e committed and &ill e
contin#ed #nless restrained" #t no in%#nction or
temporary restrainin! order shall e iss#ed on
acco#nt of any threat" prohiited or #nla&f#l act"
e)cept a!ainst the person or persons" association or
or!anization ma'in! the threat or committin! the
prohiited or #nla&f#l act or act#ally a#thorizin! or
ratifyin! the same after act#al 'no&led!e thereof$ ,36
That s#stantial and irreparale in%#ry to
complainantPs property &ill follo&$ ,-6 That as to
each item of relief to e !ranted" !reater in%#ry &ill
e inflicted #pon complainant y the denial of relief
than &ill e inflicted #pon defendants y the !rantin!
of relief$ ,I6 That complainant has no ade(#ate
remedy at la&$ and ,16 That the p#lic officers
char!ed &ith the d#ty to protect complainantPs
property are #nale or #n&illin! to f#rnish ade(#ate
protection.9
3.- +onditions for Iss#ance Ex (ar"e of a Temporary
Restrainin! Order ,TRO6
A temporary restrainin! order ,valid only for 3? days6
may e iss#ed ex $ar"e #nder the follo&in!
conditions:
a6 the complainant Fshall also alle!e that" #nless a
temporary restrainin! order shall e iss#ed &itho#t
notice" a s#stantial and irreparale in%#ry to
complainantPs property &ill e #navoidale$
6 there is Ftestimony #nder oath" s#fficient" if
s#stained" to %#stify the +ommission in iss#in! a
temporary in%#nction #pon hearin! after notice$F
c6 the Fcomplainant shall first file an #nderta'in! &ith
ade(#ate sec#rity in an amo#nt to e fi)ed y the
+ommission s#fficient to recompense those en%oined
0- D C L A T O N
LABOR RELATIONS
for any loss" e)pense or dama!e ca#sed y the
improvident or erroneo#s iss#ance of s#ch order or
in%#nction" incl#din! all reasonale costs" to!ether
&ith a reasonale attorneyPs fee" and e)pense of
defense a!ainst the order or a!ainst the !rantin! of
any in%#nctive relief so#!ht in the same proceedin!
and s#se(#ently denied y the +ommission$F and
d6 the Ftemporary restrainin! order shall e effective
for no lon!er than t&enty ,3?6 days and shall
ecome void at the e)piration of said t&enty ,3?6
days.
An in%#ry is considered irreparale if it is of s#ch
constant and fre(#ent rec#rrence that no fair and
reasonale redress can e had therefor in a co#rt of
la&" or &here there is no standard y &hich their
amo#nt can e meas#red &ith reasonale acc#racy"
that is" it is not s#sceptile of mathematical
comp#tation. It is considered irreparale in%#ry &hen
it cannot e ade(#ately compensated in dama!es
d#e to the nat#re of the in%#ry itself or the nat#re of
the ri!ht or property in%#red or &hen there e)ists no
certain pec#niary standard for the meas#rement of
dama!es.
8Croperty9 incl#des not only tan!ile property #t
also the ri!ht to #se s#ch property.
8C#lic officers9 means local la& enforcin! officers.
The 8protection9 contemplated is that &hich &o#ld
enale the employer to proceed &ith the &or'.
The intent of this re(#irement is to ta'e the
e)ec#tive f#nction of la& enforcement o#t of the
co#rt and leave it to the appropriate e)ec#tive
officers" #nless they fail to f#nction.
3.I No Ade(#ate Remedy
In addition to the other re(#irements &hich the
complainant m#st satisfy in order to otain in%#nctive
relief #nder the Act" the complainant m#st sho& that
8he has no ade(#ate remedy at la&.9
An ade(#ate remedy at la& has een defined as one
8that affords relief &ith reference to the matter in
controversy" and &hich is appropriate to the
partic#lar circ#mstances of the case.
3.1 +ash Bond
Hnder the NLR+ R#les of 3??1" no temporary
restrainin! order or &rit of preliminary in%#nction shall
e iss#ed e)cept on the condition that petitioner
shall first file an #nderta'in! to ans&er for the
dama!es and post a cash ond in the amo#nt of
Eifty Tho#sand Cesos ,C1?"???.??6" or s#ch hi!her
amo#nt as may e determined y the +ommission.
The p#rpose of the ond is to recompense those
en%oined for any loss" e)pense or dama!e ca#sed y
the improvident or erroneo#s iss#ance of s#ch order
or in%#nction" incl#din! all reasonale costs" to!ether
&ith a reasonale attorney:s fee" and e)pense of
defense a!ainst the order or a!ainst the !rantin! of
any in%#nctive relief so#!ht in the same proceedin!
and s#se(#ently denied y the +ommission.
3.. Scope
As to the scope of an in%#nction iss#ed #nder the
Act" oth the Act itself and the cases restrict the
operation of s#ch in%#nction not only to the specific
acts complained of in the pleadin!s and proven at
trial as &ron!f#l" #t f#rther" limits the in%#nction to
only those alle!ed and proven !#ilty of act#al
participation" a#thorization or ratification of s#ch
acts.
The po&er of the NLR+ to en%oin or restrain the
commission of any or all prohiited or #nla&f#l acts
as provided in Art. 305 of the Laor +ode" can only
e e)ercised in a laor disp#te.
3./ Reception of Evidence
The reception of evidence 8for the application of a
&rit of in%#nction may e dele!ated y the
+ommission to any of its Laor Ariters &ho shall
cond#ct s#ch hearin!s in s#ch places as he may
determine to e accessile to the parties and their
&itnesses and shall s#mit thereafter his
recommendation to the +ommission.9
8Laor Ariter9 in the precedin! sentence may no&
refer to 8+ommission Attorney"9 a position created y
R.A. No. 4-I/ ,@#ly 3/" 3??.6 to assist the
+ommission and its divisions in their appellate and
ad%#dicatory f#nctions.
3.5 T&enty*day Life of TRO
A temporary restrainin! order ,TRO6" if iss#ed at all
in a petition for in%#nction" is valid only for t&enty
,3?6 days and ecomes void i$o %ac"o at the end of
that period.
The TRO ta'es effect #pon its iss#ance and not
#pon receipt of the parties.
The ma)im#m period of 3? days incl#des Sat#rdays"
S#ndays" and holidays.
3.4 Ill#strative +ase: Iss#ance of TRO
3.0? In%#nction from NLR+: Not the Croper Remedy
a!ainst Employee:s =ismissal
77777777
0I D C L A T O N
LABOR RELATIONS
LArt. 33?. +omp#lsory aritration. The +ommission
or any Laor Ariter shall have the po&er to as' the
assistance of other !overnment officials and
(#alified private citizens to act as comp#lsory
aritrators on cases referred to them and to fi) and
assess the fees of s#ch comp#lsory aritrators"
ta'in! into acco#nt the nat#re of the case" the time
cons#med in hearin! the case" the professional
standin! of the aritrators" the financial capacity of
the parties" and the fees provided in the R#les of
+o#rt.M ,Repealed y Section 0." Batas Camansa
Bilan! 0-?" A#!#st 30" 04506
77777777
Art. 330. Technical r#les not indin! and prior resort
to amicale settlement. In any proceedin! efore the
+ommission or any of the Laor Ariters" the r#les of
evidence prevailin! in co#rts of la& or e(#ity shall
not e controllin! and it is the spirit and intention of
this +ode that the +ommission and its memers and
the Laor Ariters shall #se every and all reasonale
means to ascertain the facts in each case speedily
and o%ectively and &itho#t re!ard to technicalities of
la& or proced#re" all in the interest of d#e process.
In any proceedin! efore the +ommission or any
Laor Ariter" the parties may e represented y
le!al co#nsel #t it shall e the d#ty of the
+hairman" any Cresidin! +ommissioner or
+ommissioner or any Laor Ariter to e)ercise
complete control of the proceedin!s at all sta!es.
Any provision of la& to the contrary not&ithstandin!"
the Laor Ariter shall e)ert all efforts to&ards the
amicale settlement of a laor disp#te &ithin his
%#risdiction on or efore the first hearin!. The same
r#le shall apply to the +ommission in the e)ercise of
its ori!inal %#risdiction. ,As amended y Section 00"
77777777
1. PROCEEDIN%S BEFORE LABOR ARBITER OR
T(E CO--ISSION; TEC(NICAL R/LES NOT
APPLICABLE
Administrative and (#asi*%#dicial odies" li'e the
National Laor Relations +ommission" are not
o#nd y the technical r#les of proced#re in the
ad%#dication of cases.
Simplification of proced#re" &itho#t re!ard to
technicalities of la& or proced#re and &itho#t
sacrificin! the f#ndamental re(#isites of d#e
process" is mandated to ins#re a speedy
administration of social %#stice. This +o#rt constr#ed
Article 330 of the Laor +ode as to allo& the NLR+
or a laor ariter to decide a case on the asis of
position papers and other doc#ments s#mitted
&itho#t resortin! to technical r#les of evidence as
oserved in re!#lar co#rts of %#stice.
0.0 2odic#m of Admissiility$ S#stantial Evidence
It is tr#e that administrative and (#asi*%#dicial odies
li'e the NLR+ are not o#nd y the technical r#les of
proced#re in the ad%#dication of cases. No&ever" this
proced#ral r#le sho#ld not e constr#ed as a license
to disre!ard certain f#ndamental evidentiary r#les.
;hile the r#les of evidence prevailin! in the co#rts of
la& or e(#ity are not controllin! in proceedin!s
efore the NLR+" the evidence presented efore it
m#st at least have a modic#m of admissiility for it to
e !iven some proative val#e.
Not only m#st there e some evidence to s#pport a
findin! or concl#sion" #t evidence m#st e
Fs#stantial.F FS#stantial evidence is more than a
mere scintilla. It means s#ch relevant evidence as a
reasonale mind mi!ht accept as ade(#ate to
s#pport a concl#sion.
0.3 +ardinal Ri!hts in B#asi*@#dicial Croceedin!s
There are cardinal primary ri!hts &hich m#st e
respected even in proceedin!s of this character:
06 ri!ht to a hearin!$
36 tri#nal m#st consider the evidence presented$
-6 decision m#st e s#pported y somethin!
,evidence6$
I6 s#pportin! evidence m#st e s#stantial$
16 =ecision m#st e rendered on the evidence
presented or at least contained in the record and
disclosed to the parties affected$
.6 the ody or +IR or any of its %#d!es m#st act on
his o&n independent considerations of the la& and
facts" and not simply accept the vie&s of the
s#ordinate in arrivin! at a decision$ and
/6 decide in s#ch manner that parties can 'no& the
vario#s iss#es involved and the reason for the
decision.
0.- Aerification
Aerification is intended to ass#re that the alle!ations
in the pleadin! have een prepared in !ood faith or
are tr#e and correct" not mere spec#lations.
>enerally" lac' of verification is merely a format
defect that is neither %#risdictional nor fatal.
0.I Carty Respondent
01 D C L A T O N
LABOR RELATIONS
In a complaint for #nderpayment of &a!es and other
money claims filed y employees of a sin!le
proprietorship #siness" the respondent sho#ld e
the #siness o&ner. This is not necessarily the
person in &hose name the #siness is re!istered.
0.1 Crohiited Cleadin!s and 2otions
Emphasizin! the avoidance of le!al technicalities"
the NLR+ 3??1 R#les ,in R#le III" SectionI6 does
not allo& the follo&in! motions or pleadin!s:
a6 2otion to dismiss the complaint e)cept on the
!ro#nd of lac' of %#risdiction over the s#%ect matter"
improper ven#e" re 'udica"a" prescription and for#m
shoppin!$
6 2otion for a ill of partic#lars$
c6 2otion for ne& trial$
d6 Cetition for relief from %#d!ment &hen filed &ith
the Laor Ariter$
e6 Cetition for Cer"iorari" Manda#u or prohiition$
f6 2otion to declare respondent in defa#lt$
!6 2otion for reconsideration or appeal from any
interloc#tory order of the Laor Ariter.
2. -ANDATORY CONCILIATION AND -EDIATION
CONFERENCE; CO-PRO-ISE ENCO/RA%ED
Section 3. Nat#re of Croceedin!s. * The proceedin!s
efore the Laor Ariter shall e non*Iiti!io#s in nat#re.
S#%ect to the re(#irements of d#e process" the
technicalities of la& and proced#re and the r#les otainin!
in the co#rts of la& shall not strictly apply thereto. The
Laor Ariter may avail himself of all reasonale means to
ascertain the facts of the controversy speedily" incl#din!
oc#lar inspection and e)amination of &ell*informed
persons.
Section -. 2andatory +onciliation and 2ediation
+onference. K a6 The mandatory conciliation and
mediation conference shall e called for the p#rpose of ,06
amicaly settlin! the case #pon a fair compromise$ ,36
determinin! the real parties in interest$ ,-6 determinin! the
necessity of amendin! the complaint and incl#din! all
ca#ses of action$ ,I6 definin! and simplifyin! the iss#es in
the case$ ,16 enterin! into admissions or stip#lations of
facts$ and ,.6 threshin! o#t all other preliminary matters.
The Laor Ariter shall preside and ta'e f#ll control of the
proceedin!s.
6 +onciliation and mediation efforts shall e e)erted y
the Laor Ariters all thro#!ho#t the proceedin!s. Sho#ld
the parties arrive at any a!reement as to the &hole or any
part of the disp#te" the same shall e red#ced to &ritin!
and si!ned y the parties and their respective co#nsel or
a#thorized representative" if any" efore the Laor Ariter.
c6 In any case" the compromise a!reement shall e
approved y the Laor Ariter" if after e)plainin! to the
parties" partic#larly to the complainants" the terms"
conditions and conse(#ences thereof" he is satisfied that
they #nderstand the a!reement" that the same &as
entered into freely and vol#ntarily y them" and that it is
not contrary to la&" morals" and p#lic policy.
d6 A compromise a!reement d#ly entered into in
accordance &ith this Section shall e final and indin!
#pon the parties and shall have the force and effect of a
%#d!ment rendered y the Laor Ariter.
e6 The mandatory conciliation and mediation conference
shall" e)cept for %#stifiale !ro#nds" e terminated &ithin
thirty ,-?6 calendar days from the date of the first
conference.
f6 No motion for postponement shall e entertained e)cept
on meritorio#s !ro#nds.
Section I. Effect of Eail#re of +onciliation and 2ediation. *
Sho#ld the parties fail to a!ree #pon an amicale
settlement" either in &hole or in part" d#rin! the mandatory
conciliation and mediation conference" the Laor Ariter
shall terminate the conciliation and mediation sta!e and
proceed to p#rs#e the other p#rposes of the said
conference as en#merated in the immediately precedin!
Section. Thereafter" the Laor Ariter shall direct the
parties to sim#ltaneo#sly file their respective position
papers on the iss#es a!reed #pon y the parties and as
reflected in the min#tes of the proceedin!s.
Section 1. Non*Appearance of Carties. * The non*
appearance of the complainant or petitioner d#rin! the t&o
,36 settin!s for mandatory conciliation and mediation
conference sched#led in the s#mmons" despite d#e notice
thereof" shall e a !ro#nd for the dismissal of the case
&itho#t pre%#dice.
In case of non*appearance y the respondent d#rin! the
first sched#led conference" the second conference shall
proceed as sched#led in the s#mmons. If the respondent
still fails to appear at the second conference despite ein!
d#ly served &ith s#mmons" the Laor Ariter shall
immediately terminate the mandatory conciliation and
mediation conference. The Laor Ariter shall thereafter
allo& the complainant or petitioner to file his verified
position paper and s#mit evidence in s#pport of his
ca#ses of action" and there#pon render his decision on the
asis of the evidence on record.
It is tr#e that a compromise a!reement once
approved y the co#rt has the effect of re 'udica"a
et&een the parties and sho#ld not e dist#red
e)cept for vices of consent and for!ery. No&ever"
settled is the r#le that the NLR+ may disre!ard
technical r#les of proced#re in order to !ive life to
the constit#tional mandate affordin! protection to
laor and to conform to the need of protectin! the
0. D C L A T O N
LABOR RELATIONS
&or'in! class &hose inferiority a!ainst the employer
has al&ays een earmar'ed y disadvanta!e.
3.0 Bindin! Effect of +ompromise A!reement
The a#thority to compromise cannot li!htly e
pres#med and sho#ld e estalished y evidence.
Section 4. A#thority to Bind Carty. * Attorneys and other
representatives of parties shall have a#thority to ind their
clients in all matters of proced#re$ #t they cannot" &itho#t
a special po&er of attorney or e)press consent" enter into
a compromise a!reement &ith the opposin! party in f#ll or
partial dischar!e of a clientPs claim.
Also not to e overloo'ed is Section - ,c and d6 of
the NLR+ 3??1 R#les of Croced#re (#oted aove. It
re(#ires the Laor Ariter:s approval of a
compromise a!reement over a case pendin! efore
the Laor Ariter.
3.3 B#itclaim and ;aivers
A deed of release or (#itclaim cannot ar an
employee from demandin! enefits to &hich he is
le!ally entitled.
3.3a Einal and E)ec#tory @#d!ment +annot e
Ne!otiated
The %#d!ment may no lon!er e modified in any
respect" even if the modification is meant to correct
&hat is perceived to e an erroneo#s concl#sion of
fact or la&" and re!ardless of &hether the
modification is attempted to e made y the co#rt
renderin! it or y the hi!hest co#rt of the land.
'. -OTION TO DIS-ISS
Section .. 2otion to =ismiss. * On or efore the date set
for the mandatory conciliation and mediation conference"
the respondent may file a motion to dismiss. Any motion to
dismiss on the !ro#nd of lac' of %#risdiction" improper
ven#e" or that the ca#se of action is arred y prior
%#d!ment" prescription" or for#m shoppin!" shall e
immediately resolved y the Laor Ariter thro#!h a
&ritten order. An order denyin! the motion to dismiss" or
s#spendin! its resol#tion #ntil the final determination of
the case" is not appealale.
-.0 Mo"u $ro$rio =ismissal of +omplaint ased on
Crescription
-.3 Re )udica"a as Reason to =ismiss +omplaint
Eor a prior %#d!ment to constit#te a ar to a
s#se(#ent case" the follo&in! re(#isites m#st
conc#r: ,a6 it m#st e a final %#d!ment or order$ ,6
the co#rt renderin! the same m#st have %#risdiction
over the s#%ect matter and over the parties$ ,c6 it
m#st e a %#d!ment or order on the merits" and ,d6
there m#st e et&een the t&o cases Identity of
parties" s#%ect matter" and ca#ses of action.
-.- No =ismissal of +omplaint despite =eath
-.I Revival or Refilin! of =ismissed +ase
A dismissed case is not necessarily dead.
Section 0.. Revival And Re*Openin! Or Re*Eilin! Of
=ismissed +ase. * A party may file a motion to revive or
re*open a case dismissed &itho#t pre%#dice" &ithin ten
,0?6 calendar days from receipt of notice of the order
dismissin! the same$ other&ise" his only remedy shall e
to re*file the case in the aritration ranch of ori!in.
A complaint dismissed 8&itho#t pre%#dice9 simply
means a tentative or temporary dismissal<the
complaint may e revived thro#!h an appropriate
motion.
). S/B-ISSION OF POSITION PAPERS AND
REPLY
I.0 =etermination of necessity of Nearin! or
+larificatory +onference
Section 5. =etermination of Necessity of Nearin! or
+larificatory +onference. * Immediately after the
s#mission y the parties of their position paper or reply"
as the case may e" the Laor Ariter shall" #o"u $ro$rio"
determine &hether there is a need for a hearin! or
clarificatory conference. At this sta!e" he may" at his
discretion and for the p#rpose of ma'in! s#ch
determination" as' clarificatory (#estions to f#rther elicit
facts or information" incl#din! #t not limited to the
s#poena of relevant doc#mentary evidence" if any" from
any party or &itness.
I.3 Role of the Laor Ariter in hearin! and
clarificatory conference**
Section 4. Role of the Laor Ariter in Nearin! and
+larificatory +onference. * a6 The Laor Ariter shall ta'e
f#ll control and personally cond#ct the hearin! or
clarificatory conference. Hnless other&ise provided y la&"
the Laor Ariter shall determine the order of presentation
of evidence y the parties" s#%ect to the re(#irements of
d#e process. Ne shall e)amine the parties and their
&itnesses &ith respect to the matters at iss#e$ and as'
(#estions only for the p#rpose of clarifyin! points of la& or
fact involved in the case. Ne shall limit the presentation of
evidence to matters relevant to the iss#e efore him and
necessary for a %#st and speedy disposition of the case.
6 In the cross*e)amination of &itnesses" only relevant"
pertinent and material (#estions necessary to enli!hten
the Laor Ariter shall e allo&ed.
c6 The Laor Ariter shall ma'e a &ritten s#mmary of the
proceedin!s" incl#din! the s#stance of the evidence
presented" in cons#ltation &ith the parties. The &ritten
0/ D C L A T O N
LABOR RELATIONS
s#mmary shall e si!ned y the parties and shall form part
of the records.
I.- Non*appearance of Carties$ Costponement of
Nearin! and +larificatory +onferences.
Section 0?. Non*Appearance of Carties" and
Costponement of Nearin!s and +larificatory +onferences.
* a6 Non*appearance at a hearin! or clarificatory
conference y the complainant or petitioner" &ho &as d#ly
notified thereof" may e s#fficient ca#se to dismiss the
case &itho#t pre%#dice. S#%ect to Section 0. of this R#le"
&here proper %#stification is sho&n y proper motion to
&arrant the re*openin! of the case" the Laor Ariter shall
call another hearin! or clarificatory conference and
contin#e the proceedin!s #ntil the case is finally decided.
The dismissal of the case for the second time d#e to the
#n%#stified non*appearance of the complainant or
petitioner" &ho &as d#ly notified of the clarificatory
hearin!" shall e &ith pre%#dice.
6 In case the respondent fails to appear d#rin! the
hearin! or clarificatory conference despite d#e notice
thereof" the complainant shall e allo&ed to present
evidence e)*parte" &itho#t pre%#dice to cross*e)amination
at the ne)t hearin! or conference. T&o ,36 s#ccessive
non*appearances y the respondent d#rin! his sched#led
presentation of evidence or opport#nity to cross*e)amine
&itnesses" despite d#e notice thereof" shall e constr#ed
as a &aiver on his part to present evidence or cond#ct
cross*e)amination.
c6 The parties and their co#nsels appearin! efore the
Laor Ariter shall e prepared for contin#o#s hearin! or
clarificatory conference. No postponement or contin#ance
shall e allo&ed y the Laor Ariter" e)cept #pon
meritorio#s !ro#nds and s#%ect al&ays to the re(#irement
of e)peditio#s disposition of cases. In any case" the
hearin! or clarificatory conference shall e terminated
&ithin ninety ,4?6 calendar days from the date of the initial
hearin! or conference.
d6 Cara!raph ,c6 of this Section not&ithstandin!" in cases
involvin! overseas Eilipino &or'ers" the a!!re!ate period
for cond#ctin! the mandatory conciliation and mediation
conference" incl#din! hearin! on the merits or clarificatory
conference" shall not e)ceed si)ty ,.?6 days" &hich shall
e rec'oned from the date of ac(#isition of %#risdiction y
the Laor Ariter over the person of the respondents.
0. S/B-ISSION OF T(E CASE FOR DECISION
1.0 Cosition Capers as Basis of =ecision
The affidavits in s#ch case may ta'e the place of
their direct testimony. The laor ariter may choose"
if he deems it necessary" to set the case for hearin!
on the merits &here &itnesses may e presented
and e)amined y the parties. In oth instances" the
#rden of provin! that the termination &as for valid
or a#thorized ca#se rests on the employer.
1.3 Lac' of Aerification" Not Eatal
The lac' of verification of the position paper*affidavit
is a formal" rather than a s#stantial" defect. It is not
fatal. It co#ld e easily corrected y re(#irin! an
oath.
1.- =#e Crocess: Opport#nity to Be Neard
The simple meanin! of proced#ral d#e process is
that a party to a case m#st e !iven s#fficient
opport#nity to e heard. Its very essence is to allo&
all parties opport#nity to present evidence.
A formal or trial*type hearin! is not at all times and in
all instances essential to d#e process" the
re(#irements of &hich are satisfied &here parties
are afforded fair and reasonale opport#nity to
e)plain their side of the controversy at hand.
1.I Inhiition
Section 03. Inhiition. * A Laor Ariter may vol#ntarily
inhiit himself from the resol#tion of a case and shall so
state in &ritin! the le!al %#stifications therefor. Hpon
motion of a party" either on the !ro#nd of relationship
&ithin the fo#rth civil de!ree of consan!#inity or affinity
&ith the adverse party or co#nsel" or on (#estion of
impartiality" the Laor Ariter may inhiit himself from
f#rther hearin! and decidin! the case. S#ch motion shall
e resolved &ithin five ,16 days from the filin! thereof. An
order denyin! or !rantin! a motion for inhiition is
inappealale.
1.1 =#e Crocess Incl#des Impartiality of the Appeal
Body
In addition" administrative d#e process incl#des ,a6
the ri!ht to notice" e it act#al or constr#ctive" of the
instit#tion of the proceedin!s that may affect a
personPs le!al ri!ht$ ,6 reasonale opport#nity to
appear and defend his ri!hts and to introd#ce
&itnesses and relevant evidence in his favor$ ,c6 a
tri#nal so constit#ted as to !ive him reasonale
ass#rance of honesty and impartiality" and one of
competent %#risdiction$ and ,d6 a findin! or decision
y that tri#nal s#pported y s#stantial evidence
presented at the hearin! or at least ascertained in
the records or disclosed to the parties.
It is self*evident from the r#lin! case la& that the
officer &ho revie&s a case on appeal sho#ld not e
the same person &hose decision is the s#%ect of
revie&. Th#s" &e have r#led that Fthe revie&in!
officer m#st perforce e other than the officer &hose
decision is #nder revie&.
5. S/SPENSION OF PROCEEDIN%S
To allo& laor cases to proceed &o#ld clearly defeat
the p#rpose of the a#tomatic stay and severely
05 D C L A T O N
LABOR RELATIONS
enc#mer the mana!ement committee:s time and
reso#rces.
+. FILIN% AND SERVICE OF PLEADIN%S AND
DECISIONS
Section 1. Eilin! and Service of Cleadin!s. * All pleadin!s
in connection &ith the case shall e filed &ith the
appropriate doc'etin! #nit of the Re!ional Aritration
Branch or the +ommission" as the case maye.
The party filin! the pleadin!s shall serve the opposin!
parties &ith a copy thereof and its s#pportin! doc#ments
in the manner provided for in these R#les &ith proof of
service thereof.
/.0 Service of Notice and Resol#tions
Section .. Service of Notices and Resol#tions. * a6 Notices
or s#mmons and copies of orders" shall e served on the
parties to the case personally y the Bailiff or d#ly
a#thorized p#lic officer &ithin three ,-6 days from receipt
thereof or y re!istered mail$ Crovided that in special
circ#mstances" service of s#mmons may e effected in
accordance &ith the pertinent provisions of the R#les of
+o#rt$ Crovided f#rther" that in cases of decisions and final
a&ards" copies thereof shall e served on oth parties and
their co#nsel or representative y re!istered mail$
Crovided f#rther that in cases &here a party to a case or
his co#nsel on record personally see's service of the
decision #pon in(#iry thereon" service to said party shall
e deemed effected #pon act#al receipt thereof$ Crovided
finally" that &here parties are so n#mero#s" service shall
e made on co#nsel and #pon s#ch n#mer of
complainants" as may e practicale" &hich shall e
considered s#stantial compliance &ith Article 33I ,a6 of
the Laor +ode" as amended.
Eor p#rposes of appeal" the period shall e co#nted from
receipt of s#ch decisions" resol#tions" or orders y the
co#nsel or representative of record.
6 The Bailiff or officer servin! the notice" order" resol#tion
or decision shall s#mit his ret#rn &ithin t&o ,36 days from
date of service thereof" statin! le!ily in his ret#rn his
name" the names of the persons served and the date of
receipt" &hich ret#rn shall e immediately attached and
shall form part of the records of the case. In case of
service y re!istered mail" the Bailiff or officer shall &rite in
the ret#rn" the names of persons served and the date of
mailin! of the resol#tion or decision. If no service &as
effected" the service officer shall state the reason therefor
in the ret#rn.
/.3 Croof and +ompleteness of Service
Section /. Croof and +ompleteness of Service. * The
ret#rn is prima facie proof of the facts indicated therein.
Service y re!istered mail is complete #pon receipt y the
addressee or his a!ent$ #t if the addressee fails to claim
his mail from the post office &ithin five ,16 days from the
date of first notice of the postmaster" service shall ta'e
effect after s#ch time.
Section I" R#le 0- of the R#les of +o#rt &hich is
s#ppletory to the r#les of the NLR+" provides as
follo&s:
Section I. Cersonal Service. < Service of the
papers may e made y deliverin! personally a copy to
the party or his attorney" or y leavin! it in his office &ith
his cler' or &ith a person havin! char!e thereof. If no
person is fo#nd in his office" or his office is not 'no&n"
then y leavin! the copy" et&een the ho#rs of ei!ht in the
mornin! and si) in the evenin!" at the partyPs or attorneyPs
residence" if 'no&n" &ith a person of s#fficient discretion
to receive the same.
*. RESOL/TION OF DO/BT IN LA# OR
EVIDENCE
It is no& a familiar r#le that do#t as to the
interpretation of laor la&s and re!#lations has to e
resolved in favor of laor. This precept is etched in
the Laor +ode ,Art. I6 and" in similar tenor" the +ivil
+ode ,Art. 0/?36.
B#t this precept is not limited to interpretation of
le!al provisions. It e)tends li'e&ise to do#ts ao#t
the evidence of the disp#tants.
6. DECISION OF LABOR ARBITER
Section 0-. Ceriod to =ecide +ase. * The Laor Ariter
shall render his decision &ithin thirty ,-?6 calendar days"
&itho#t e)tension" after the s#mission of the case y the
parties for decision" even in the asence of steno!raphic
notes$ Crovided ho&ever" that cases involvin! overseas
Eilipino &or'ers shall e decided &ithin ninety ,4?6
calendar days after the filin! of the complaint &hich shall
commence to r#n #pon ac(#isition y the Laor Ariter of
%#risdiction over the respondents.
4.0 +ontents of =ecisions
Section 0I. +ontents of =ecisions. * The decisions and
orders of the Laor Ariter shall e clear and concise and
shall incl#de a rief statement of the: a6 facts of the case$
6 iss#es involved$ c6 applicale la&s or r#les$ d6
concl#sions and the reasons therefor$ and e6 specific
remedy or relief !ranted. In cases involvin! monetary
a&ards" the decisions or orders of the Laor Ariter shall
contain the amo#nt a&arded.
In case the decision of the Laor Ariter incl#des an order
of reinstatement" it shall li'e&ise contain: a6 a statement
that the reinstatement aspect is immediately e)ec#tory$
and 6 a directive for the employer to s#mit a report of
compliance &ithin ten ,0?6 calendar days from receipt of
the said decision.
4.3 No 2otions for Reconsideration and Cetition for
Relief from @#d!ment
Section 01. 2otions for Reconsideration and Cetitions for
Relief from @#d!ment. * No motions for reconsideration or
petitions for relief from %#d!ment of any decision"
04 D C L A T O N
LABOR RELATIONS
resol#tion or order of a Laor Ariter shall e
allo&ed.No&ever" &hen one s#ch motion for
reconsideration is filed" it shall e treated as an appeal
provided that it complies &ith the re(#irements for
perfectin! an appeal.In the case of a petition for relief from
%#d!ment" the Laor Ariter shall elevate the case to the
+ommission for disposition.
77777777
Art. 333. Appearances and Eees.
a. Non*la&yers may appear efore the +ommission
or any Laor Ariter only:

0. If they represent themselves$ or

3. If they represent their or!anization or
memers thereof.

. No attorney:s fees" ne!otiation fees or similar
char!es of any 'ind arisin! from any collective
ar!ainin! a!reement shall e imposed on any
individ#al memer of the contractin! #nion:
Crovided" No&ever" that attorney:s fees may e
char!ed a!ainst #nion f#nds in an amo#nt to e
a!reed #pon y the parties. Any contract" a!reement
or arran!ement of any sort to the contrary shall e
n#ll and void. ,As amended y Cresidential =ecree
No. 0.40" 2ay 0" 045?6
77777777
1. APPEARANCE OF NON.LA#YERS
Section 5. Appearances. * 6 A non*la&yer may appear as
co#nsel in any of the proceedin!s efore the Laor Ariter
or +ommission only #nder the follo&in! conditions:
,06 he represents himself as party to the case$
,36 he represents a le!itimate laor or!anization" as
defined #nder Article 303 and 3I3 of the Laor +ode" as
amended" &hich is a party to the case: Crovided" that he
presents: ,i6 a certification from the B#rea# of Laor
Relations ,BLR6 or Re!ional Office of the =epartment of
Laor and Employment attestin! that the or!anization he
represents is d#ly re!istered and listed in the roster of
le!itimate laor or!anizations$ ,ii6 a verified certification
iss#ed y the secretary and attested to y the president of
the said or!anization statin! that he is a#thorized to
represent the said or!anization in the said case$ and ,iii6 a
copy of the resol#tion of the oard of directors of the said
or!anization !rantin! him s#ch a#thority$
,-6 he represents a memer or memers of a le!itimate
laor or!anization that is e)istin! &ithin the employerPs
estalishment" &ho are parties to the case: Crovided" that
he presents: ,i6 a verified certification attestin! that he is
a#thorized y s#ch memer or memers to represent
them in the case$ and ,ii6 a verified certification iss#ed y
the secretary and attested to y the president of the said
or!anization statin! that the person or persons he is
representin! are memers of their or!anization &hich is
e)istin! in the employerPs estalishment$
,I6 he is a d#ly*accredited memer of any le!al aid office
reco!nized y the =epartment of @#stice or Inte!rated Bar
of the Chilippines: Crovided" that he ,i6 presents proof of
his accreditation$ and ,ii6 represents a party to the case$
,16 he is the o&ner or president of a corporation or
estalishment &hich is a party to the case: Crovided" that
he presents: ,i6 a verified certification attestin! that he is
a#thorized to represent said corporation or estalishment$
and ,ii6 a copy of the resol#tion of the oard of directors of
said corporation" or other similar resol#tion or instr#ment
iss#ed y said estalishment" !rantin! him s#ch a#thority.
2. C(AN%E OF LA#YER
No s#stit#tion of attorneys &ill e allo&ed #nless
the follo&in! re(#isites conc#r:
06 there m#st e filed a &ritten application for
s#stit#tion$
36 there m#st e filed the &ritten consent of the
client to the s#stit#tion$
-6 there m#st e filed the &ritten consent of the
attorney to e s#stit#ted" if s#ch consent can e
otained$
I6 in case s#ch &ritten consent cannot e proc#red"
there m#st e filed &ith the application for
s#stit#tion" proof of the service of notice of s#ch
motion in the manner re(#ired y the r#les" on the
attorney to e s#stit#ted.
'. A/T(ORITY TO BIND PARTY
). ATTORNEY$S FEE
The p#rpose of the provision is to prevent imposition
on the &or'ers of the d#ty to individ#ally contri#te
their respective shares in the fee to e paid the
attorney for his services on ehalf of the #nion in its
ne!otiations &ith the mana!ement. The oli!ation to
pay the attorneyPs fees elon!s to the #nion and
cannot e sh#nted to the &or'ers as their direct
responsiility.
I.0 Ne!otiation Eee
The 0?1 ne!otiation fee &hich covers attorney:s
fees" a!ency fee" and the li'e is ased on the
amo#nt of ac'&a!es receivale #nder the +BA
&hich is eyond &hat the la& !rants.
3? D C L A T O N
LABOR RELATIONS
I.3 Eor Services Rendered y Hnion Officers
Article 333 ,6 prohiits attorneyPs fees" ne!otiations
fees and similar char!es arisin! o#t of the
concl#sion of a collective ar!ainin! a!reement from
ein! imposed on any individ#al #nion memer. The
collection of the special assessment partly for the
payment for services rendered y #nion officers"
cons#ltants and others may not e in the cate!ory of
FattorneyPs fees or ne!otiations fees.F B#t there is no
(#estion that it is an e)action &hich falls &ithin the
cate!ory of a Fsimilar char!e"F and" therefore" &ithin
the covera!e of the prohiition in the aforementioned
article.
77777777
Chapter III
APPEAL
Art. 33-. Appeal. =ecisions" a&ards" or orders of the
Laor Ariter are final and e)ec#tory #nless
appealed to the +ommission y any or oth parties
&ithin ten ,0?6 calendar days from receipt of s#ch
decisions" a&ards" or orders. S#ch appeal may e
entertained only on any of the follo&in! !ro#nds:
a. If there is prima facie evidence of a#se of
discretion on the part of the Laor Ariter$

. If the decision" order or a&ard &as sec#red
thro#!h fra#d or coercion" incl#din! !raft and
corr#ption$

c. If made p#rely on (#estions of la&$ and

d. If serio#s errors in the findin!s of facts are raised
&hich &o#ld ca#se !rave or irreparale dama!e or
in%#ry to the appellant.
In case of a %#d!ment involvin! a monetary a&ard"
an appeal y the employer may e perfected only
#pon the postin! of a cash or s#rety ond iss#ed y
a rep#tale ondin! company d#ly accredited y the
+ommission in the amo#nt e(#ivalent to the
monetary a&ard in the %#d!ment appealed from.
In any event" the decision of the Laor Ariter
reinstatin! a dismissed or separated employee"
insofar as the reinstatement aspect is concerned"
shall immediately e e)ec#tory" even pendin!
appeal. The employee shall either e admitted ac'
to &or' #nder the same terms and conditions
prevailin! prior to his dismissal or separation or" at
the option of the employer" merely reinstated in the
payroll. The postin! of a ond y the employer shall
not stay the e)ec#tion for reinstatement provided
herein.
To disco#ra!e frivolo#s or dilatory appeals" the
+ommission or the Laor Ariter shall impose
reasonale penalty" incl#din! fines or cens#res"
#pon the errin! parties.
In all cases" the appellant shall f#rnish a copy of the
memorand#m of appeal to the other party &ho shall
file an ans&er not later than ten ,0?6 calendar days
from receipt thereof.
The +ommission shall decide all cases &ithin t&enty
,3?6 calendar days from receipt of the ans&er of the
appellee. The decision of the +ommission shall e
final and e)ec#tory after ten ,0?6 calendar days from
receipt thereof y the parties.
Any la& enforcement a!ency may e dep#tized y
the Secretary of Laor and Employment or the
+ommission in the enforcement of decisions" a&ards
or orders. ,As amended y Section 03" Rep#lic Act
No. ./01" 2arch 30" 04546
77777777
1. NO -OTION FOR RECONSIDERATION OF
LABOR ARBITER$S DECISION
If any !ro#nds mentioned in this Article e)ists" the
losin! party may appeal the Laor Ariter:s decision
to the NLR+ &ithin ten ,0?6 days from receipt of the
decision.
0.0 Einal =ecision +annot Be Amended
If not appealed on time" the Laor Ariter:s decision
ecomes final and cannot e amended.
The perfection of an appeal &ithin the stat#tory or
re!lementary period is not only mandatory #t also
%#risdictional and fail#re to do so renders the
(#estioned decision final and e)ec#tor" th#s
deprivin! the appellate co#rt of %#risdiction to alter
the final %#d!ment" m#ch less entertain the appeal.
2. PERIOD TO APPEAL FRO- LABOR ARBITER
3.0 Ten +alendar =ays
A period of ten ,0?6 days from receipt of any order is
!ranted to either or to oth parties involved to appeal
to the National Laor Relations +ommission.
After mat#re and caref#l delieration" ;e have
arrived at the concl#sion that the shortened period of
ten ,0?6 days fi)ed y Article 33- contemplates
calendar days and not &or'in! days. ;e are
pers#aded to this concl#sion" if only eca#se ;e
elieve that it is precisely in the interest of laor that
the la& has commanded that laor cases e
promptly" if not peremptorily" dispose of.
30 D C L A T O N
LABOR RELATIONS
This +o#rt reiterates the doctrine en#nciated in said
case that the 0?*day period provided in Art. 33- of
the Laor +ode refers to 0? calendar days and not
0? &or'in! days. This means that Sat#rdays"
S#ndays and Le!al Nolidays are not to e e)cl#ded"
#t incl#ded" in co#ntin! the 0?*day period. This is in
line &ith the o%ective of the la& for speedy
disposition of laor cases &ith the end in vie& of
protectin! the interests of the &or'in! man.
3.3 Ten*+alendar*=ay R#le Not Applicale Crior to
Air*@en +ase
3.- Hnder the 3??1 NLR+ R#les of Croced#re
Section 0. Ceriods of Appeal. * =ecisions" resol#tions or
orders of the Laor Ariter shall e final and e)ec#tory
#nless appealed to the +ommission y any or oth parties
&ithin ten ,0?6 calendar days from receipt thereof$ and in
case of decisions" resol#tions or orders of the Re!ional
=irector of the =epartment of Laor and Employment
p#rs#ant to Article 034 of the Laor +ode" &ithin five ,16
calendar days from receipt thereof. If the 0?th or 1th day"
as the case may e" falls on a Sat#rday" S#nday or
holiday" the last day to perfect the appeal shall e the first
&or'in! day follo&in! s#ch Sat#rday" S#nday or holiday.
3.I =ate of Receipt y 2ail
The r#le is that service y re!istered mail is
complete either #pon act#al receipt y the
addressee or at the end of five ,16 days" if he does
not claim it &ithin five ,16 days from the first notice of
the postmaster. ,R#le 0-" Q56 The p#rpose is to
place the date of receipt of pleadin!s" %#d!ments
and processes eyond the po&er of the party ein!
served to determine at his pleas#re.
3.1 Eail#re to >ive +opy of Appeal to Adverse Carty
;ithin Ten =ays
The fail#re to !ive copy of appeal to the appellee
&ithin ten ,0?6 days is not fatal if the appellee &as
not pre%#diced y the delay in the service of said
copy of appeal.
3.. No E)tension of Ceriod
Section 0. Ceriods of Appeal. * No motion or re(#est for
e)tension of the period &ithin &hich to perfect an appeal
shall e allo&ed.
3./ Ceriods >enerally 2andatory
S#ch periods are imposed &ith a vie& to prevent
needless delays and to ens#re the orderly and
speedy dischar!e of %#dicial #siness. Strict
compliance &ith s#ch r#le is oth mandatory and
imperative.
'. %RO/NDS OF APPEAL
Section 3. >ro#nds. * The appeal may e entertained only
on any of the follo&in! !ro#nds:
a6 If there is prima facie evidence of a#se of discretion on
the part of the Laor Ariter or Re!ional =irector$
6 If the decision" resol#tion or order &as sec#red thro#!h
fra#d or coercion" incl#din! !raft and corr#ption$
c6 If made p#rely on (#estions of la&$ andGor
d6 If serio#s errors in the findin!s of facts are raised &hich"
if not corrected" &o#ld ca#se !rave or irreparale dama!e
or in%#ry to the appellant.
). #(ERE TO FILE APPEAL
Section -. ;here Eiled. * The appeal shall e filed &ith the
Re!ional Aritration Branch or Re!ional Office &here the
case &as heard and decided.
0. RE2/ISITES FOR PERFECTION OF APPEAL
Section I. re(#isites Eor Cerfection Of Appeal. * a6 The
appeal shall e: 06 filed &ithin the re!lementary period
provided in Section 0 of this R#le$ 36 verified y the
appellant himself in accordance &ith Section I" R#le / of
the R#les of +o#rt" as amended$ -6 in the form of a
memorand#m of appeal &hich shall state the !ro#nds
relied #pon and the ar!#ments in s#pport thereof" the
relief prayed for" and &ith a statement of the date the
appellant received the appealed decision" resol#tion or
order$ I6 in three ,-6 le!ily type&ritten or printed copies$
and 16 accompanied y i6 proof of payment of the re(#ired
appeal fee$ ii6 postin! of a cash or s#rety ond as provided
in Section . of this R#le$ iii6 a certificate of non*for#m
shoppin!$ and iv6 proof of service #pon the other parties.
6 A mere notice of appeal &itho#t complyin! &ith the
other re(#isites aforestated shall not stop the r#nnin! of
the period for perfectin! an appeal.
c6 The appellee may file &ith the Re!ional Aritration
Branch or Re!ional Office &here the appeal &as filed" his
ans&er or reply to appellantPs memorand#m of appeal" not
later than ten ,0?6 calendar days from receipt thereof.
Eail#re on the part of the appellee &ho &as properly
f#rnished &ith a copy of the appeal to file his ans&er or
reply &ithin the said period may e constr#ed as a &aiver
on his part to file the same.
d6 S#%ect to the provisions of Article 305 of the Laor
+ode" once the appeal is perfected in accordance &ith
these R#les" the +ommission shall limit itself to revie&in!
and decidin! only the specific iss#es that &ere elevated
on appeal.
5. FRIVOLO/S APPEAL
Section 00" R#le AI of the NLR+ R#les of Croced#re
empo&ers not only the +ommission #t also the
Laor Ariter to impose reasonale penalties"
33 D C L A T O N
LABOR RELATIONS
incl#din! fines and cens#res" #pon a party for filin! a
frivolo#s appeal. This implies that even &hen the
appeal is still &ith the Laor*Ariter" and not yet
transmitted to the +ommission" the former may
already find it frivolo#s and" there and then"
terminate that appeal.
..0 Hnverified Letter Not Croper Appeal
+. PAY-ENT OF APPEAT FEES
Section 1. Appeal Eee. * The appellant shall pay an appeal
fee of One N#ndred Eifty Cesos ,C01?.??6 to the Re!ional
Aritration Branch or Re!ional Office of ori!in" and the
official receipt of s#ch payment shall form part of the
records of the case.
The fail#re to pay the appeal doc'etin! fee confers a
directory and not a mandatory po&er to dismiss an
appeal" and s#ch po&er m#st e e)ercised &ith a
so#nd discretion and &ith a !reat deal of
circ#mspection considerin! all attendant
circ#mstances.
*. APPEAL BOND; FILIN% ON TI-E;
E8CEPTIONS
Section .. Bond. * In case the decision of the Laor Ariter
or the Re!ional =irector involves a monetary a&ard" an
appeal y the employer may e perfected only #pon the
postin! of a ond" &hich shall either e in the form of cash
deposit or s#rety ond e(#ivalent in amo#nt to the
monetary a&ard" e)cl#sive of dama!es and attorneyPs
fees.
In case of s#rety ond" the same shall e iss#ed y a
rep#tale ondin! company d#ly accredited y the
+ommission or the S#preme +o#rt" and shall e
accompanied y ori!inal or certified tr#e copies of the
follo&in!:
a6 a %oint declaration #nder oath y the employer" his
co#nsel" and the ondin! company" attestin! that the ond
posted is !en#ine" and shall e in effect #ntil final
disposition of the case.
6 an indemnity a!reement et&een the employer*
appellant and ondin! company$
c6 proof of sec#rity deposit or collateral sec#rin! the ond:
provided" that a chec' shall not e considered as an
acceptale sec#rity$
d6 a certificate of a#thority from the Ins#rance
+ommission$
e6 certificate of re!istration from the Sec#rities and
E)chan!e +ommission$
f6 certificate of a#thority to transact s#rety #siness from
the Office of the Cresident$
!6 certificate of accreditation and a#thority from the
S#preme +o#rt$ and
h6 notarized oard resol#tion or secretaryPs certificate from
the ondin! company sho&in! its a#thorized si!natories
and their specimen si!nat#res.
A cash or s#rety ond shall e valid and effective from the
date of deposit or postin!" #ntil the case is finally decided"
resolved or terminated" or the a&ard satisfied.This
condition shall e deemed incorporated in the terms and
conditions of the s#rety ond" and shall e indin! on the
appellants and the ondin! company.
The appellant shall f#rnish the appellee &ith a certified
tr#e copy of the said s#rety ond &ith all the aove*
mentioned s#pportin! doc#ments.The appellee shall verify
the re!#larity and !en#ineness thereof and immediately
report any irre!#larity to the +ommission.
Hpon verification y the +ommission that the ond is
irre!#lar or not !en#ine" the +ommission shall ca#se the
immediate dismissal of the appeal" and cens#re or cite in
contempt the responsile parties and their co#nsels" or
s#%ect them to reasonale fine or penalty.
No motion to red#ce ond shall e entertained e)cept on
meritorio#s !ro#nds" and only #pon the postin! of a ond
in a reasonale amo#nt in relation to the monetary a&ard.
The mere filin! of a motion to red#ce ond &itho#t
complyin! &ith the re(#isites in the precedin! para!raphs
shall not stop the r#nnin! of the period to perfect an
appeal.
The ond is ine *ua non to the perfection of appeal
from the laor ariter:s monetary a&ard.
5.0 2otion to Red#ce Bond #nder NLR+ R#les
A motion to red#ce the amo#nt of the ond may e
entertained" #t" meantime" a ond in reasonale
amo#nt m#st e filed any&ay.
5.3 No Bond" No Appeal Cerfected
The la&ma'ers intended the postin! of a cash or
s#rety ond y the employer to e the e)cl#sive
means y &hich an employer:s appeal may e
considered completed.
5.3a Rela)in! the Ten*day Ceriod
5.- No =istinction Bet&een 8Eilin!9 and 8Cerfection9
of Appeal$ Star An!el =ecision" Not 8Aenerale9
5.I Amo#nt of Appeal Bond E)cl#des =ama!es
An appeal is deemed perfected #pon the postin! of
the ond e(#ivalent to the monetary a&ard
exclui!e o% #oral and exe#$lar+ da#age a ,ell
a a""orne+- %ee.
3- D C L A T O N
LABOR RELATIONS
5.1 Is Croperty Bond AcceptaleR OES.
5.. S#persedeas Bond
S#stantial %#stice demands that it f#lfill its
commitment to post the ond in order to stay
e)ec#tion of the %#d!ment a!ainst it pendin!
resol#tion of the appeal therefrom. This
consideration cannot e o#t&ei!hed y the claim
that proced#ral errors &ere committed y the Laor
Ariter.
6. RECORDS AND TRANS-ITTAL
Section /. Records of +ase on Appeal. * The records of a
case shall have a correspondin! inde) of its contents
&hich shall incl#de the follo&in!: a6 the ori!inal copy of the
complaint$ 6 other pleadin!s and motions$ c6 min#tes of
the proceedin!s" notices" transcripts of steno!raphic
notes" if any$ d6 decisions" orders" and resol#tions as &ell
as proof of service thereof" if availale$ e6 the comp#tation
of the a&ard$ f6 memorand#m of appeal and the reply or
ans&er thereto" if any" and proof of service" if availale$ !6
official receipt of the appeal fee$ and h6 the appeal ond" if
any.
The records shall e chronolo!ically arran!ed and pa!ed
prominently.
Section 5. Transmittal Of Records Of +ase On Appeal. *
;ithin forty*ei!ht ,I56 ho#rs after the filin! of the appeal"
the records of the case shall e transmitted y the
Re!ional Aritration Branch or office of ori!in to the
+ommission.
17. EFFECT OF APPEAL OF ARBITER$S
DECISION
Section 4. Cerfection Of Appeal$ Effect. * ;itho#t pre%#dice
to immediate reinstatement pendin! appeal #nder Section
. of R#le SI" once an appeal is filed" the Laor Ariter
loses %#risdiction over the case. All pleadin!s and motions
pertainin! to the appealed case shall thereafter e
addressed to and filed &ith the +ommission.
0?.0 E)ec#tion or Reinstatement Cendin! Appeal
Section .. E)ec#tion of Reinstatement Cendin! Appeal. *
In case the decision incl#des an order of reinstatement"
and the employer disoeys the directive #nder the second
para!raph of Section 0I of R#le A or ref#ses to reinstate
the dismissed employee" the Laor Ariter shall
immediately iss#e &rit of e)ec#tion" even pendin! appeal"
directin! the employer to immediately reinstate the
dismissed employee either physically or in the payroll" and
to pay the accr#ed salaries as a conse(#ence of s#ch
reinstatement at the rate specified in the decision.
The Sheriff shall serve the &rit of e)ec#tion #pon the
employer or any other person re(#ired y la& to oey the
same. If he disoeys the &rit" s#ch employer or person
may e cited for contempt in accordance &ith R#le IS.
0?.3 Effect of Cerfection of Appeal on E)ec#tion
Section 4. Effect of Cerfection of Appeal on E)ec#tion. *
The perfection of an appeal shall stay the e)ec#tion of the
decision of the Laor Ariter on appeal" e)cept e)ec#tion
for reinstatement pendin! appeal.
11. FRIVOLO/S OR DILATORY APPEALS
Section 0?. Erivolo#s or =ilatory Appeals. * No appeal
from an interloc#tory order shall e entertained.To
disco#ra!e frivolo#s or dilatory appeals" incl#din! those
ta'en from interloc#tory orders" the +ommission may
cens#re or cite in contempt the errin! parties and their
co#nsels" or s#%ect them to reasonale fine or penalty.
12. APPEALS FRO- DECISION OF OT(ER
A%ENCIES
Section 00. Appeals from =ecision of Other A!encies. *
The R#les provided herein !overnin! appeals from the
decisions or orders of Laor Ariters shall apply to appeals
to the +ommission from decisions or orders of the other
offices or a!encies appealale to the +ommission
accordin! to la&.
1'. PROCEEDIN% BEFORE T(E CO--ISSION
Section 3. +omposition and Internal E#nctions of the
+ommission En Banc and Its =ivisions. K 6 +ommission
En Banc. * The +ommission shall sit en anc only for
p#rposes of prom#l!atin! r#les and re!#lations !overnin!
the hearin! and disposition of cases efore its =ivisions
and Re!ional Aritration Branches" and for the form#lation
of policies affectin! its administration and operations. It
may" on temporary or emer!ency asis" allo& cases &ithin
the %#risdiction of any =ivision to e heard y any other
=ivision &hose doc'et allo&s the additional &or'load and
s#ch transfer &ill not e)pose liti!ants to #nnecessary
additional e)pense.
c6 =ivisions. * Hnless other&ise provided y la&" the
+ommission shall e)ercise its ad%#dicatory and all other
po&ers" f#nctions and d#ties thro#!h its five ,16 =ivisions.
Each =ivision shall consist of one memer from the p#lic
sector &ho shall act as the Cresidin! +ommissioner and
one memer each from the &or'ers and employers
sectors" respectively.
Section I. +ommission En Banc Session" B#or#m and
Aote. * c6 =ivision. * The presence of at least t&o ,36
+ommissioners of a =ivision shall constit#te a (#or#m.
The conc#rrence of t&o ,36 +ommissioners of a =ivision
shall e necessary for the prono#ncement of a %#d!ment
or resol#tion.
;henever the re(#ired memership in a =ivision is not
complete and the conc#rrence of t&o ,36 +ommissioners
to arrive at a %#d!ment or resol#tion cannot e otained"
the +hairman shall desi!nate s#ch n#mer of additional
+ommissioners from the other =ivisions as may e
necessary from the same sector.
3I D C L A T O N
LABOR RELATIONS
d6 Role of +hairman in the =ivision. * The +hairman of the
+ommission may convene and preside over the session of
any =ivision to consider any case pendin! efore it and
participate in its delierations" if in his %#d!ment" his
presence therein &ill est serve the interests of laor
%#stice. Ne shall not ho&ever" participate in the votin! y
the =ivision" e)cept &hen he is actin! as Cresidin!
+ommissioner of the =ivision in the asence of the re!#lar
Cresidin! +ommissioner
0-.0 Iss#es on Appeal
Section I,d6 R#le AI of the NLR+ R#les of
Croced#re" the +ommission shall" in cases of
perfected appeals" limit itself to revie&in! those
iss#es &hich &ere raised on appeal.
0-.3 Technical R#les Not Bindin!
Section 0?. Technical R#les Not Bindin!. * The r#les of
proced#re and evidence prevailin! in co#rts of la& and
e(#ity shall not e controllin! and the +ommission shall
#se every and all reasonale means to ascertain the facts
in each case speedily and o%ectively" &itho#t re!ard to
technicalities of la& or proced#re" all in the interest of d#e
process.
In any proceedin! efore the +ommission" the parties may
e represented y le!al co#nsel #t it shall e the d#ty of
the +hairman" any Cresidin! +ommissioner or
+ommissioner to e)ercise complete control of the
proceedin!s at all sta!es.
0-.3a Evidence S#mitted on Appeal to NLR+
The settled r#le is that the NLR+ is not precl#ded
from receivin! evidence on appeal as technical r#les
of evidence are not indin! in laor cases. In fact"
laor officials are mandated y the Laor +ode to
#se every and all reasonale means to ascertain the
facts in each case speedily and o%ectively" &itho#t
re!ard to technicalities of la& or proced#re" all in the
interest of d#e process.
0-.- +onciliationG2ediation
Section 00. +onciliation and 2ediation. * In the e)ercise of
its e)cl#sive" ori!inal and appellate %#risdiction" the
+ommission may e)ert all efforts to&ards the amicale
settlement of a laor disp#te.
The settlement of cases on appeal" to e valid and indin!
et&een the parties" shall e made efore the
+ommissioner or his a#thorized representative.
0-.I +ons#ltation
Section 1. +ons#ltation. * The concl#sions of a =ivision on
any case or matter s#mitted to it for decision shall e
reached in cons#ltation efore the case is assi!ned to a
memer for the &ritin! of the opinion. It shall e
mandatory for the =ivision to meet for the p#rpose of the
cons#ltation ordained herein.
A certification to this effect si!ned y the Cresidin!
+ommissioner of the =ivision shall e iss#ed and a copy
thereof attached to the record of the case and served
#pon the parties.
0-.1 =issentin! Opinion
Section .. =issentin! Opinion. * Sho#ld any memer of a
=ivision indicate his intention to &rite a dissentin! opinion"
he may file the same &ithin the period prescried for
decidin! or resolvin! the appeal$ other&ise" s#ch &ritten
dissentin! opinion shall not e considered part of the
records of the case.
0-.1 Inhiition
Section /. Inhiition. * No motion to inhiit the entire
=ivision of the +ommission shall e entertained. No&ever"
any +ommissioner may inhiit himself from the
consideration and resol#tion of any case or matter efore
the =ivision and shall so state in &ritin! the le!al or
%#stifiale !ro#nds therefor. In the event that a memer
inhiits himself" the case shall e raffled y the E)ec#tive
+ler' or =ep#ty E)ec#tive +ler' to either of the t&o ,36
remainin! +ommissioners. In case t&o ,36 +ommissioners
in a =ivision inhiit themselves in a case or matter efore
it" the +hairman shall" as far as practicale" appoint t&o
,36 +ommissioners from other =ivisions representin! the
sector of the +ommissioners &ho inhiited themselves.
1). FOR- OF DECISION3 RESOL/TION AND
ORDER
Section 0-. Eorm of =ecision" Resol#tion and Order. * The
decision" resol#tion and order of the +ommission shall
state clearly and distinctly the findin!s of facts" iss#es" and
concl#sions of la& on &hich it is ased" and the relief
!ranted" if any. If the decision" resol#tion or order involves
monetary a&ards" the same shall contain the specific
amo#nt a&arded as of the date the decision is rendered.
Hnder Art. 33-" the +ommission shall decide ll cases
&ithin t&enty calendar days from receipt of the
ans&er of the appellee.
The decision of the +ommission shall e final and
e)ec#tory after ten calendar days from receipt
thereof y the parties.
0I.0 Reasoned Reversal
;hile it is &ithin respondent +ommissionPs
competence" as an appellate a!ency revie&in!
decisions of Laor Ariters" to disa!ree &ith and set
aside the latterPs findin!s" it stands to reason that it
sho#ld state an acceptale ca#se therefor. It &o#ld
other&ise e a &himsical" capricio#s" oppressive"
illo!ical" #nreasonale e)ercise of (#asi*%#dicial
prero!ative" s#%ect to invalidation y the
e)traordinary &rit of cer"iorari.
31 D C L A T O N
LABOR RELATIONS
0I.3 E)tended 2eanin! of 8Appeal9 #nder Article
33-$ NLR+ 2ay Iss#e ;rit of Cer"iorari
10. FINALITY OF DECISION OF T(E
CO--ISSION AND ENTRY OF 4/D%-ENT
Section 0I. Einality Of =ecision Of The +ommission And
Entry Of @#d!ment. * a6 Einality of the =ecisions"
Resol#tions or Orders of the +ommission. * E)cept as
provided in Section 4 of R#le S" the decisions" resol#tions
or orders of the +ommission shall ecome final and
e)ec#tory after ten ,0?6 calendar days from receipt thereof
y the parties.
6 Entry of @#d!ment. * Hpon the e)piration of the ten ,0?6
calendar day period provided in para!raph ,a6 of this
Section" the decision" resol#tion" or order shall e entered
in a oo' of entries of %#d!ment.
The E)ec#tive +ler' or =ep#ty E)ec#tive +ler' shall
consider the decision" resol#tion or order as final and
e)ec#tory after si)ty ,.?6 calendar days from date of
mailin! in the asence of ret#rn cards" certifications from
the post office" or other proof of service to parties.
15. -OTION FOR RECONSIDERATION
Section 01.2OTIONS EOR RE+ONSI=ERATION. *
2otion for reconsideration of any decision" resol#tion or
order of the +ommission shall not e entertained e)cept
&hen ased on palpale or patent errors$ provided that the
motion is #nder oath and filed &ithin ten ,0?6 calendar
days from receipt of decision" resol#tion or order" &ith
proof of service that a copy of the same has een
f#rnished" &ithin the re!lementary period" the adverse
party$ and provided f#rther" that only one s#ch motion from
the same party shall e entertained.
Sho#ld a motion for reconsideration e entertained
p#rs#ant to this section" the resol#tion shall e e)ec#tory
after ten ,0?6 calendar days from receipt thereof.
The NLR+ R#les does not allo& a second motion for
reconsideration. The NLR+ a#ses its discretion
&hen it violates its o&n r#les y entertainin! s#ch a
motion.
A s#pplemental motion for reconsideration filed
o#tside the 0?*day appeal period cannot e
entertained.
0..0 Carty ;ho Eailed to Appeal on Time Erom
=ecision of Laor Ariter 2ay Still Eile 2otion for
Reconsideration of NLR+ =ecision
It is also an accepted post#late that iss#es not
raised in the lo&er co#rt or the laor ariter may not
e raised for the first time on appeal.
1+. CERTIFIED CASES
1*. APPEAL FRO- T(E NATIONAL LABOR
RELATIONS CO--ISSION
05.0 Revie& y Cer"iorari y the +o#rt of Appeals$
St. 2artin case
In a n#tshell" the St. 2artin precedent states:
,06 the &ay to revie& NLR+ decisions is thro#!h the
special civil action of cer"iorari #nder R#le .1$
,36 the %#risdiction over s#ch action elon!s to oth
the S#preme +o#rt and the +o#rt of Appeals$ #t
,-6 in line &ith the doctrine n hierarchy of co#rts" the
petition sho#ld e initially presented to the lo&er of
the t&o co#rts" that is" the +o#rt of Appeals.
05.3 ;hen and ;here to Eile Cetition
Section I. ;hen and &here petition filed. < The
petition shall e filed not later than si)ty ,.?6 days from
notice of the %#d!ment" order or resol#tion. In case a
motion for reconsideration or ne& trial is timely filed"
&hether s#ch motion is re(#ired or not" the si)ty ,.?6 day
period shall e co#nted from notice of the denial of said
motion.
The petition shall e filed in the S#preme +o#rt or" if it
relates to the acts or omissions of a lo&er co#rt or of a
corporation" oard" officer or person" in the Re!ional Trial
+o#rt e)ercisin! %#risdiction over the territorial area as
defined y the S#preme +o#rt. It may also e filed in the
+o#rt of Appeals &hether or not the same is in aid of its
appellate %#risdiction" or in the Sandi!anayan if it is in aid
of its appellate %#risdiction. If it involves the acts or
omissions of a (#asi*%#dicial a!ency" #nless other&ise
provided y la& or these R#les" the petition shall e filed
in and co!nizale only y the +o#rt of Appeals.
No e)tension of time to file the petition shall e !ranted
e)cept for compellin! reason and in no case e)ceedin!
fifteen ,016 days. ,Ia6 ,Bar 2atter No. 5?-" 30 @#ly 0445$
A.2. No. ??*3*?-*S+6
05.3a One =ay Late
The .?*day period m#st caref#lly e oserved.
Re!lementary periods are indispensale
interdictions a!ainst needless delays.
05.3 +ertified Tr#e +opy of NLR+ =ecision
N#mero#s decisions iss#ed y this +o#rt emphasize
that in appeals #nder R#le I1 and in ori!inal civil
actions for cer"iorari #nder R#le .1 in relation to
R#les I. and 1." &hat is re(#ired to e certified is
the copy of the (#estioned %#d!ment" final order or
resol#tion. Since the LAPs =ecision &as not the
3. D C L A T O N
LABOR RELATIONS
(#estioned r#lin!" it did not have to e certified.
;hat had to e certified &as the NLR+ =ecision.
05.- Effect on NLR+:s =ecision
Section 0?. Effect of Cetition for Cer"iorari on E)ec#tion. *
A petition for cer"iorari &ith the +o#rt of Appeals or the
S#preme +o#rt shall not stay the e)ec#tion of the assailed
decision #nless a restrainin! order is iss#ed y said
co#rts.
05.I Appeal to Laor Secretary Aolished
Cresidential =ecree No. 0-40 amended Article 33-
and aolished appeals to the Secretary of Laor.
05.1 >ro#nds for Cer"iorari
A party may seasonaly avail of the special civil
action for cer"iorari" &here the tri#nal" oard or
officer e)ercisin! %#dicial f#nctions has acted &itho#t
or in e)cess of its %#risdiction" or &ith !rave a#se of
discretion" and prayin! that %#d!ment e rendered
ann#llin! or modifyin! the proceedin!s" as the la&
re(#ires" of s#ch tri#nal" oard or officer.
In spite of stat#tory provisions ma'in! Tfinal: the
decisions of certain administrative a!encies" the
S#preme +o#rt Lor +o#rt of AppealsM #sin! the
po&er of %#dicial revie&" has ta'en co!nizance of
petitions (#estionin! the decisions &here &ant of
%#risdiction" !rave a#se of discretion" violation of
d#e process" denial of s#stantial %#stice" or
erroneo#s interpretation of the la& &ere ro#!ht to
its attention.
The &rit of cer"iorari &ill iss#e to #ndo those acts"
and do %#stice to the a!!rieved party.
05.. 8>rave A#se of =iscretion9
By !rave a#se of discretion is meant capricio#s and
&himsical e)ercise of %#d!ment as is e(#ivalent to
lac' of %#risdiction. 2ere a#se of discretion is not
eno#!h. It m#st e !rave a#se of discretion as
&hen the po&er is e)ercised in an aritrary or
despotic manner y reason of passion or personal
hostility" and m#st e so patent and so !ross as to
amo#nt to an evasion of a positive d#ty or to a virt#al
ref#sal to perform the d#ty en%oined or to act at all in
contemplation of la&.
05./ Sole Office of Cer"iorari
The appellate co#rt:s %#risdiction to revie& a decision
of the NLR+ in a petition for certiorari is confined to
iss#es of %#risdiction or !rave a#se of discretion. An
e)traordinary remedy" a petition for certiorari is
availale only and restrictively in tr#ly e)ceptional
cases. The sole office of the &rit of certiorari is the
correction of errors of %#risdiction incl#din! the
commission of !rave a#se of discretion amo#ntin!
to lac' or e)cess of %#risdiction. It does not incl#de
correction of the NLR+:s eval#ation of the evidence
or of its fact#al findin!s. S#ch findin!s are !enerally
accorded not only respect #t also finality. A party
assailin! s#ch findin!s ears the #rden of sho&in!
that the tri#nal acted capricio#sly and &himsically
or in total disre!ard of evidence material to the
controversy" in order that the e)traordinary &rit of
certiorari &ill lie.
05.5 Appeal from OSE+ to +A$ St. 2artin R#lin!
Applies
Tho#!h appeals from the NLR+ to the Secretary of
Laor &ere eliminated" presently there are several
instances in the Laor +ode and its implementin!
and related r#les &here an appeal can e filed &ith
the Office of the Secretary of Laor or the Secretary
of Laor iss#es a r#lin!" to &it:
,06 Hnder the R#les and Re!#lations >overnin!
Recr#itment and Clacement A!encies for Local
Employment 0I dated @#ne 1" 044/ s#persedin!
certain provisions of Boo' I ,Cre*Employment6 of the
implementin! r#les" the decision of the Re!ional
=irector on complaints a!ainst a!encies is
appealale to the Secretary of Laor &ithin ten ,0?6
&or'in! days from receipt of a copy of the order" on
specified !ro#nds" &hose decision shall e final and
inappealale.
,36 Art. 035 of the Laor +ode provides that an order
iss#ed y the d#ly a#thorized representative of the
Secretary of Laor in laor standards cases
p#rs#ant to his visitorial and enforcement po&er
#nder said article may e appealed to the Secretary
of Laor.
Sec. 3 in relation to Section - ,a6" R#le S" Boo' III
,+onditions of Employment6 of the implementin! r#les
!ives the Re!ional =irector the po&er to order and
administer compliance &ith the laor standards provisions
of the +ode and other laor le!islation. Section I !ives the
Secretary the po&er to revie& the order of the Re!ional
=irector" and the SecretaryPs decision shall e final and
e)ec#tory.
Sec. 0" R#le IA ,Appeals6 of the R#les on the =isposition
of Laor Standards +ases in the Re!ional Offices dated
Septemer 0." 045/ 01 provides that the order of the
Re!ional =irector in laor standards cases shall e final
and e)ec#tory #nless appealed to the Secretary of Laor.
Sec. 1" R#le A ,E)ec#tion6 provides that the decisions"
orders or resol#tions of the Secretary of Laor and
Employment shall ecome final and e)ec#tory after ten
,0?6 calendar days from receipt of the case records. The
filin! of a petition for certiorari efore the S#preme +o#rt
shall not stay the e)ec#tion of the order or decision #nless
3/ D C L A T O N
LABOR RELATIONS
the a!!rieved party sec#res a temporary restrainin! order
from the +o#rt &ithin fifteen ,016 calendar days from the
date of finality of the order or decision or posts a
s#persedeas ond.
Sec. . of R#le AI ,Nealth and Safety +ases6 provides that
the Secretary of Laor at his o&n initiative or #pon the
re(#est of the employer andGor employee may revie& the
order of the Re!ional =irector in occ#pational health and
safety cases. The SecretaryPs order shall e final and
e)ec#tory.
,36 Art. 3-. provides that the decision of the Laor
Relations =ivision in the re!ional office denyin! an
applicant laor or!anization" association or !ro#p of
#nions or &or'ersP application for re!istration may e
appealed y the applicant #nion to the B#rea# of
Laor Relations &ithin ten ,0?6 days from receipt of
notice thereof.
Sec. I" R#le A" Boo' A ,Laor Relations6" as amended y
=epartment Order No. 4 dated 2ay 0" 044/ 0. provides
that the decision of the Re!ional Office denyin! the
application for re!istration of a &or'ers association &hose
place of operation is confined to one re!ional %#risdiction"
or the B#rea# of Laor Relations denyin! the re!istration
of a federation" national or ind#stry #nion or trade #nion
center may e appealed to the B#rea# or the Secretary as
the case may e &ho shall decide the appeal &ithin t&enty
,3?6 calendar days from receipt of the records of the case.
,-6 Art. 3-5 provides that the certificate of
re!istration of any le!itimate or!anization shall e
canceled y the B#rea# of Laor Relations if it has
reason to elieve" after d#e hearin!" that the said
laor or!anization no lon!er meets one or more of
the re(#irements prescried y la&.
Sec. I" R#le AIII" Boo' A provides that the decision of the
Re!ional Office or the =irector of the B#rea# of Laor
Relations may e appealed &ithin ten ,0?6 days from
receipt thereof y the a!!rieved party to the =irector of the
B#rea# or the Secretary of Laor" as the case may e"
&hose decision shall e final and e)ec#tory.
,I6 Art. 314 provides that any party to a certification
election may appeal the order or res#lts of the
election as determined y the 2ed*Ariter directly to
the Secretary of Laor &ho shall decide the same
&ithin fifteen ,016 calendar days.
Sec. 03" R#le SI" Boo' A provides that the decision of the
2ed*Ariter on the petition for certification election may e
appealed to the Secretary.
Sec. 01" R#le SI" Boo' A provides that the decision of the
Secretary of Laor on an appeal from the 2ed*AriterPs
decision on a petition for certification election shall e final
and e)ec#tory. The implementation of the decision of the
Secretary affirmin! the decision to cond#ct a certification
election shall not e stayed #nless restrained y the
appropriate co#rt.
Sec. 01" R#le SII" Boo' A provides that the decision of the
2ed*Ariter on the res#lts of the certification election may
e appealed to the Secretary &ithin ten ,0?6 days from
receipt y the parties of a copy thereof" &hose decision
shall e final and e)ec#tory.
Sec. /" R#le SAIII ,Administration of Trade Hnion E#nds
and Actions Arisin! Therefrom6" Boo' A provides that the
decision of the B#rea# in complaints filed directly &ith said
office pertainin! to administration of trade #nion f#nds may
e appealed to the Secretary of Laor &ithin ten ,0?6 days
from receipt of the parties of a copy thereof.
Sec. 0" R#le SSIA ,E)ec#tion of =ecisions" A&ards" or
Orders6" Boo' A provides that the decision of the
Secretary of Laor shall e final and e)ec#tory after ten
,0?6 calendar days from receipt thereof y the parties
#nless other&ise specifically provided for in Boo' A.
,16 Art. 3.- provides that the Secretary of Laor
shall decide or resolve the laor disp#te over &hich
he ass#med %#risdiction &ithin thirty ,-?6 days from
the date of the ass#mption of %#risdiction. Nis
decision shall e final and e)ec#tory ten ,0?6
calendar days after receipt thereof y the parties.
05.4 E)ha#stion of Administrative Remedies$ 2otion
for Reconsideration Re(#ired
The remedy of an a!!rieved party in a decision or
resol#tion of the Secretary of the =OLE is to timely
file a motion for reconsideration as a precondition of
or any f#rther or s#se(#ent remedy" and then
seasonaly file a special civil action for cer"iorari
#nder R#le .1 of the 044/ R#les of +ivil Croced#re.
Cetitioner:s fail#re to file its motion for
reconsideration seasonaly is fatal to its ca#se and
in effect" renders final and e)ec#tor the Resol#tion of
the Secretary of the =OLE.
A petition for cer"iorari sho#ld e preceded y
e)ha#stion of administrative remedies.
;hen an administrative remedy is provided y la&"
relief m#st e so#!ht y first e)ha#stin! that remedy
efore see'in! %#dicial intervention. Eail#re to do so
is fatal.
05.0? E)ceptions
It has een held that the re(#irement of a motion for
reconsideration may e dispensed &ith in the
follo&in! instances: ,06 &hen the iss#e raised is one
p#rely of la&$ ,36 &here p#lic interest is involved$
,-6 in cases of #r!ency$ and ,I6 &here special
circ#mstances &arrant immediate or more direct
action. On the other hand" amon! the accepted
e)ceptions to the r#le on e)ha#stion of
administrative remedies are: ,06 &here the (#estion
in disp#te is p#rely a le!al one$ and ,36 &here the
35 D C L A T O N
LABOR RELATIONS
controverted act is patently ille!al or &as performed
&itho#t %#risdiction or in e)cess of %#risdiction.
16. CERTIFICATION OF NON.FOR/- S(OPPIN%
Eor#m shoppin! is the act or attempt to present the
same disp#te to different ad%#dicators in the hope of
sec#rin! a favo#rale r#lin!.
In relation thereto" R#le /" Section 1 of the R#les of
+o#rt provides:
+ertification a!ainst for#m shoppin!.<The plaintiff or
principal party shall certify #nder oath in the complaint or
other initiatory pleadin! assertin! a claim for relief" or in a
s&orn certification anne)ed thereto and sim#ltaneo#sly
filed there&ith:
,a6 that he has not theretofore commenced any action or
filed any claim involvin! the same iss#es in any co#rt"
tri#nal or (#asi*%#dicial a!ency and" to the est of his
'no&led!e" no s#ch other action or claim is pendin!
therein$
,6 if there is s#ch other pendin! action or claim" a
complete statement of the present stat#s thereof$ and
,c6 if he sho#ld thereafter learn that the same or similar
action or claim has een filed or is pendin!" he shall report
that fact &ithin five ,16 days therefrom to the co#rt &herein
his aforesaid complaint or initiatory pleadin! has een
filed.
Eail#re to comply &ith the fore!oin! re(#irements
shall not e c#rale y mere amendment of the
complaint or other initiatory pleadin! #t shall e
ca#se for the dismissal of the case &itho#t pre%#dice"
#nless other&ise provided" #pon motion and after
hearin!. The s#mission of a false certification or
non*compliance &ith any of the #nderta'in!s therein
shall constit#te indirect contempt of co#rt" &itho#t
pre%#dice to the correspondin! administrative and
criminal actions. If the acts of the party or his
co#nsel clearly constit#te &illf#l and delierate for#m
shoppin!" the same shall e !ro#nd for s#mmary
dismissal &ith pre%#dice and shall constit#te direct
contempt" as &ell as a ca#se for administrative
sanctions.
04.0 +ertification of Nonfor#m Shoppin! 2#st e
2ade y Cetitioner
The certification m#st e made y petitioner himself
and not y co#nsel since it is petitioner &ho is in the
est position to 'no& &hether he has previo#sly
commenced any similar action involvin! the same
iss#es in any other tri#nal or a!ency.
27. DISPOSITION BY T(E CO/RT OF APPEALS
3?.0 Remand
3?.3 =ismissal of Appeal
3?.- Eindin!s of Eacts >enerally Einal
As a !eneral r#le" the findin!s of administrative
a!encies are accorded not only respect #t even
finality.
The doctrine that the findin!s of facts of the NLR+
are indin! on this +o#rt if s#pported y s#stantial
evidence is &ell estalished. No&ever" in the same
&ay that the findin!s of facts #ns#pported y
s#stantial and credile evidence do not ind the
S#preme +o#rt Lor +o#rt of AppealsM" neither &ill &e
#phold erroneo#s concl#sions of the NLR+ &hen &e
find that the latter committed !rave a#se of
discretion in reversin! the decision of the laor
ariter" especially if the findin!s of NLR+ ased on
practically the same facts estalished in the hearin!s
efore the ariter are spec#lative and con%ect#ral
3?.I E)ceptions:
,06 &hen the findin!s are !ro#nded entirely on
spec#lation" s#rmises" or con%ect#res$
,36 &hen the inference made is manifestly mista'en"
as#rd" or impossile$
,-6 &hen there is !rave a#se of discretion$
,I6 &hen the %#d!ment is ased on a
misapprehension of facts$
,16 &hen the findin!s of facts are conflictin!$
,.6 &hen in ma'in! its findin!s" the +o#rt of Appeals
&ent eyond the iss#es of the case" or its findin!s
are contrary to the admissions of oth the appellant
and the appellee$
,/6 &hen the findin!s are contrary to the trial co#rt$
,56 &hen the findin!s are concl#sions &itho#t citation
of specific evidence on &hich they are ased$
,46 &hen the facts set forth in the petition as &ell as
in the petitionerPs main and reply riefs are not
disp#ted y the respondent$
,0?6 &hen the findin!s of fact are premised on the
s#pposed asence of evidence and contradicted y
the evidence on record$ and
,006 &hen the +o#rt of Appeals manifestly
overloo'ed certain relevant facts not disp#ted y the
parties" &hich" if properly considered" &o#ld %#stify a
different concl#sion.
34 D C L A T O N
LABOR RELATIONS
3?.1 E)amples: Some Eindin!s of Eacts Reversed
21. FRO- CA TO SC1 ONLY 2/ESTION OF LA#3
R/LE )0
It m#st e filed &ithin fifteen ,016 days from notice of
the %#d!ment or final order or resol#tion appealed
from" or of the denial of the petitioner:s motion for
ne& trial or reconsideration.
The special civil action of cer"iorari #nder R#le .1
cannot e #sed as a s#stit#te for an appeal #nder
R#le I1 that the petitioner already lost.
77777777
Art. 33I. E)ec#tion of decisions" orders or a&ards.
a. The Secretary of Laor and Employment or any
Re!ional =irector" the +ommission or any Laor
Ariter" or 2ed*Ariter or Aol#ntary Aritrator may"
#o"u $ro$rio or on motion of any interested party"
iss#e a &rit of e)ec#tion on a %#d!ment &ithin five
,16 years from the date it ecomes final and
e)ec#tory" re(#irin! a sheriff or a d#ly dep#tized
officer to e)ec#te or enforce final decisions" orders
or a&ards of the Secretary of Laor and
Employment or re!ional director" the +ommission"
the Laor Ariter or med*ariter" or vol#ntary
aritrators. In any case" it shall e the d#ty of the
responsile officer to separately f#rnish immediately
the co#nsels of record and the parties &ith copies of
said decisions" orders or a&ards. Eail#re to comply
&ith the d#ty prescried herein shall s#%ect s#ch
responsile officer to appropriate administrative
sanctions.

. The Secretary of Laor and Employment" and the
+hairman of the +ommission may desi!nate special
sheriffs and ta'e any meas#re #nder e)istin! la&s to
ens#re compliance &ith their decisions" orders or
a&ards and those of the Laor Ariters and
vol#ntary aritrators" incl#din! the imposition of
administrative fines &hich shall not e less than
C1??.?? nor more than C0?"???.??. ,As amended
y Section 0-" Rep#lic Act No. ./01" 2arch 30"
04546
77777777
1. E8EC/TION
A &rit of 8E)ec#tion9 is an order to carry o#t" to
implement" a final %#d!ment.
Hnder Art. 33I" a &rit of e)ec#tion may e iss#ed y
the follo&in! officials for the final decisions" order or
a&ards prom#l!ated y them:
a6 Secretary of Laor and Employment$
6 any Re!ional =irector$
c6 the +ommission$
d6 the Laor Ariter$
e6the 2ed*Ariter$
f6 the Aol#ntary Aritrator$ or
!6 the Canel of Aritrators.
The &rit of e)ec#tion on a %#d!ment may e iss#ed
#o"u $ro$rio or on motion of any interested party
&ithin five ,16 years from the date it ecomes final
and e)ec#tory
E)ec#tion is done thro#!h the re!#lar or special
sheriff. B#t alternatively" the Secretary" the
+ommission" any Laor Ariter" the Re!ional
=irector or the =irector of the B#rea# of Laor
Relations in appropriate cases may dep#tize the
Chilippine National Colice or any la& enforcement
a!encies in the enforcement of final a&ards" orders
or decisions.
0.0 Article 33I is E)ec#tion" Not Appeal" Croced#re
0.3 Both Carty and +o#nsel Sho#ld Be Notified
2. E8EC/TION /PON FINALITY OF DECISION
OR ORDER
Section 0. E)ec#tion Hpon Einality of =ecision or Order. *
a6 A &rit of e)ec#tion may e iss#ed #o"u $ro$rio or on
motion" #pon a decision or order that finally disposes of
the action or proceedin!s after the parties and their
co#nsels or a#thorized representatives are f#rnished &ith
copies of the decision or order in accordance &ith these
R#les" #t only after the e)piration of the period to appeal
if no appeal has een filed" as sho&n y the certificate of
finality. If an appeal has een filed" a &rit of e)ec#tion may
e iss#ed &hen there is an entry of %#d!ment as provided
for in Section 0I of R#le AII.
6 No motion for e)ec#tion shall e entertained nor a &rit
of e)ec#tion e iss#ed #nless the Laor Ariter or the
+ommission is in possession of the records of the case
&hich shall incl#de an entry of %#d!ment if the case &as
appealed$ e)cept that" as provided for in Section 0I of
R#le A and Section . of this R#le" and in those cases
&here partial e)ec#tion is allo&ed y la&" the Laor Ariter
shall retain d#plicate ori!inal copies of the decision to e
implemented and proof of service thereof for the p#rpose
of immediate enforcement.
Section 3. Cre*E)ec#tion +onference. * ;ithin t&o ,36
&or'in! days from receipt of a motion for the iss#ance of a
&rit of e)ec#tion" and s#%ect to Section 0" para!raph ,6
of this R#le" the Laor Ariter shall sched#le a pre*
e)ec#tion conference or hearin! to thresh o#t matters
-? D C L A T O N
LABOR RELATIONS
relevant to e)ec#tion" incl#din! the comp#tation of the
a&ard.
Section -. Eorm and +ontents of a ;rit of E)ec#tion. * The
&rit of e)ec#tion m#st e iss#ed in the name of the
Rep#lic of the Chilippines si!ned y the +ommission or
Laor Ariter re(#irin! the Sheriff to e)ec#te the decision"
order" or a&ard of the +ommission or Laor Ariter" and
m#st contain the dispositive portion thereof" the amo#nt" if
any" to e demanded" and all la&f#l fees to e collected
from the losin! party or any other person re(#ired y la&
to oey the same.
Section I. +omp#tation =#rin! E)ec#tion. * ;here f#rther
comp#tation of the a&ard in the decision" resol#tion or
order is necessary d#rin! the co#rse of the e)ec#tion
proceedin!s" no &rit of e)ec#tion shall e iss#ed #ntil after
the comp#tation has een approved y the Laor Ariter
in an order iss#ed after the parties have een d#ly notified
and heard on the matter.
Section 1. E)ec#tion of 2onetary @#d!ment. * a6
Immediate payment on demand. * The Sheriff shall
enforce a monetary %#d!ment y demandin! the
immediate payment of the f#ll amo#nt stated in the &rit of
e)ec#tion and all la&f#l fees from the losin! party or any
other person re(#ired y la& to oey the same.
6 In the event of fail#re or ref#sal of the losin! party to
pay the %#d!ment a&ard" the Sheriff shall immediately
proceed a!ainst the cash deposit or s#rety ond posted y
the losin! party" if any$
c6 If the ondin! company ref#ses to comply &ith the &rit
of e)ec#tion" then its president and officers or a#thorized
representatives shall e cited for contempt" and the
ondin! company shall e arred from transactin!
#siness &ith the +ommission$
d6 Sho#ld the cash deposit or s#rety ond e ins#fficient"
or in case the s#rety ond cannot e proceeded a!ainst
for any reason" the Sheriff shall" &ithin five ,16 days from
demand" e)ec#te the monetary %#d!ment y levyin! on the
property" personal and real" of the losin! party not e)empt
from e)ec#tion" s#fficient to cover the %#d!ment a&ard"
&hich may e disposed of for val#e at a p#lic a#ction to
the hi!hest idder.
e6 Croceeds of e)ec#tion shall e deposited &ith the
+ashier of the concerned =ivision or Re!ional Aritration
Branch" or &ith an a#thorized depositary an'. ;here
payment is made in the form of a chec'" the same shall e
payale to the +ommission.
Section /. Enforcement of ;rit of E)ec#tion. * In e)ec#tin!
a decision" resol#tion or order" the Sheriff" or other
a#thorized officer actin! as Sheriff of the +ommission"
shall e !#ided strictly y these R#les" and y the 2an#al
on E)ec#tion of @#d!ment" &hich shall form part of these
R#les. In the asence of applicale r#les" the R#les of
+o#rt" as amended" shall e applied in a s#ppletory
manner.
Section 5. E)ec#tion By 2otion or By Independent Action.
* A decision or order may e e)ec#ted on motion &ithin
five ,16 years from the date it ecomes final and e)ec#tory.
After the lapse of s#ch period" the %#d!ment shall ecome
dormant" and may only e enforced y an independent
action &ithin a period of ten ,0?6 years from date of its
finality.
Section 0?. Effect of Cetition for +ertiorari on E)ec#tion. *
A petition for certiorari &ith the +o#rt of Appeals or the
S#preme +o#rt shall not stay the e)ec#tion of the assailed
decision #nless a restrainin! order is iss#ed y said
co#rts.
Section 00. Resol#tion of 2otion to B#ash. * The mere
filin! of a motion to (#ash shall not stay e)ec#tion
proceedin!s. A motion to (#ash shall e resolved y the
Laor Ariter &ithin ten ,0?6 &or'in! days from s#mission
of said motion for resol#tion.
'. APPEAL ON T(E E8EC/TION OF DECISION;
S/PERVENIN% EVENTS
A %#d!ment ecomes final and e)ec#tory y
operation of la&" not y %#dicial declaration.
Accordin!ly" finality of %#d!ment ecomes a fact
#pon the lapse of the re!lementary period of appeal
if no appeal is perfected. In s#ch a sit#ation" the
prevailin! party is entitled as a matter of ri!ht to a
&rit of e)ec#tion$ and iss#ance thereof is a
ministerial d#ty" compellale y mandam#s.
). %ENERAL R/LE1 RE%IONAL TRIAL CO/RT
CANNOT ISS/E IN4/NCTION A%AINST NLRC
Crecedents ao#nd confirmin! the r#le that said
co#rts have no laor %#risdiction to act on laor
cases or vario#s incidents arisin! therefrom"
incl#din! the e)ec#tion of decisions" a&ards or
orders. @#risdiction to try and ad%#dicate s#ch cases
pertains e)cl#sively to the proper laor official
concerned #nder the =epartment of Laor and
Employment. To hold other&ise is to sanction split
%#risdiction &hich is ono)io#s to the orderly
administration of %#stice.
I.0 E)ec#tion Over Croperty O&ned Only y
@#d!ment =etor$ Remedies of Third Carty
+laimant$ The O#pan!co +ase
A third party &hose property has een levied #pon
y a sheriff to enforce a decision a!ainst a %#d!ment
detor is afforded &ith several alternative remedies
to protect its interests. The third party may avail
himself of alternative remedies c#m#latively" and
one &ill not precl#de the third party from availin!
himself of the other alternative remedies in the event
he failed in the remedy first availed of.
Th#s" a third party may avail himself of the follo&in!
alternative remedies:
a6 Eile a third party claim &ith the sheriff of the Laor
Ariter" and
-0 D C L A T O N
LABOR RELATIONS
6 If the third party claim is denied" the third party
may appeal the denial to the NLR+.
Even if a third party claim &as denied" a third party
may still file a proper action &ith a competent co#rt
to recover o&nership of the property ille!ally seized
y the sheriff.
The ri!ht of a third*party claimant to file an
independent action to vindicate his claim of
o&nership over the properties seized is reserved y
Section 0/ ,no& 0.6" R#le -4 of the R#les of +o#rt.
The aforesaid remedies are nevertheless &itho#t
pre%#dice to Pany proper actionP that a third*party
claimant may deem s#itale to vindicate Phis claim to
the property.
B#ite ovio#sly" too" this Pproper actionP &o#ld have
for its o%ect the recovery of o&nership or
possession of the property seized y the sheriff" as
&ell as dama!es res#ltin! from the alle!edly
&ron!f#l seiz#re and detention thereof despite the
third*party claim.
The remedies aove mentioned are c#m#lative and
may e resorted to y a third*party claimant
independent of or separately from and &itho#t need
of availin! of the others.
I.3 RT+ In%#nction a!ainst Laor Ariter or NLR+"
;hen Allo&ed
The re!ional trial co#rt &here the reinvindicatory
action is filed can iss#e an in%#nction or temporary
restrainin! order a!ainst the e)ec#tion ordered y a
laor ariter or the NLR+.
The !eneral r#le that no co#rt has the po&er to
interfere y in%#nction &ith the %#d!ments or decrees
of another co#rt &ith conc#rrent or coordinate
%#risdiction possessin! e(#al po&er to !rant
in%#nctive relief" applies only &hen no third*party
claimant is involved.
@#rispr#dence is li'e&ise replete &ith r#lin!s that
since the third*party claimant is not one of the
parties to the action" he co#ld not" strictly spea'in!"
appeal from the order denyin! his claim" #t sho#ld
file a separate reinvindicatory action a!ainst the
e)ec#tion creditor or the p#rchaser of the property
after the sale at p#lic a#ction" or a complaint for
dama!es a!ainst the ond filed y the %#d!ment
creditor in favor of the sheriff.
I.- Third Carty +laim
Section 03. Third Carty +laim. * A third party claim shall e
filed &ithin five ,16 days from the last day of postin! or
p#lication of the notice of e)ec#tion sale$ other&ise the
claim shall e forever arred.The third party claimant shall
e)ec#te an affidavit statin! his title to the property or ri!ht
to possession thereof &ith s#pportin! evidence" and shall
file the same &ith the Sheriff and the +ommission or Laor
Ariter &ho iss#ed the &rit of e)ec#tion.Hpon receipt of
the third party claim" all proceedin!s" &ith respect to the
e)ec#tion of the property s#%ect of s#ch claim" shall
a#tomatically e s#spended.The Laor Ariter &ho iss#ed
the &rit may re(#ire the third party claimant to add#ce
additional evidence in s#pport of his third party claim and
to post a cash or s#rety ond e(#ivalent to the amo#nt of
his claim" as provided for in Section . of R#le AI" &itho#t
pre%#dice to the postin! y the prevailin! party of a
s#persedeas ond in an amo#nt e(#ivalent to that posted
y the third party claimant.The Laor Ariter shall resolve
the propriety of s#ch third party claim &ithin ten ,0?6
&or'in! days from s#mission of said claim for resol#tion.
I.I Sim#lated Sale" Aoid A& Ini"io
A third*party claim on a levied property does not
a#tomatically prevent e)ec#tion. ;hen a third*party
claim is filed" the sheriff is not o#nd to proceed &ith
the levy of the property #nless the %#d!ment creditor
or the latterPs a!ent posts an indemnity ond a!ainst
the claim. ;here the ond is filed" the remedy of the
third*party claimant is to file an independent
reivindicatory action a!ainst the %#d!ment creditor or
the p#rchaser of the property at p#lic a#ction.
77777777
Art. 331. +ontempt po&ers of the Secretary of Laor.
In the e)ercise of his po&ers #nder this +ode" the
Secretary of Laor may hold any person in direct or
indirect contempt and impose the appropriate
penalties therefor.
77777777
Title III
B/REA/ OF LABOR RELATIONS
Art. 33.. B#rea# of Laor Relations. The B#rea# of
Laor Relations and the Laor Relations =ivisions in
the re!ional offices of the =epartment of Laor" shall
have ori!inal and e)cl#sive a#thority to act" at their
o&n initiative or #pon re(#est of either or oth
parties" on all inter*#nion and intra*#nion conflicts"
and all disp#tes" !rievances or prolems arisin! from
or affectin! laor*mana!ement relations in all
&or'places" &hether a!ric#lt#ral or non*a!ric#lt#ral"
e)cept those arisin! from the implementation or
interpretation of collective ar!ainin! a!reements
&hich shall e the s#%ect of !rievance proced#re
andGor vol#ntary aritration.
The B#rea# shall have fifteen ,016 &or'in! days to
act on laor cases efore it" s#%ect to e)tension y
-3 D C L A T O N
LABOR RELATIONS
a!reement of the parties. ,As amended y Section
0I" Rep#lic Act No. ./01" 2arch 30" 04546.
77777777
1. BLR 4/RISDICTION
The B#rea# of Laor Relations ,BLR6 no lon!er
handles 8all9 laor*mana!ement disp#tes$ rather" its
f#nctions and %#risdiction are lar!ely confined to
#nion matters" collective ar!ainin! re!istry" and
laor ed#cation.
Section 0.. B#rea# of Laor Relations. * The B#rea# of
Laor Relations shall set policies" standards" and
proced#res on the re!istration and s#pervision of
le!itimate laor #nion activities incl#din! denial"
cancellation and revocation of laor #nion permits. It shall
also set policies" standards" and proced#re relatin! to
collective ar!ainin! a!reements" and the e)amination of
financial records of acco#nts of laor or!anizations to
determine compliance &ith relevant la&s.
2. INTER./NION AND INTRA./NION DISP/TES;
D.O. NO. )7.7'
FInter*Hnion =isp#teF refers to any conflict et&een
and amon! le!itimate laor #nions involvin!
representation (#estions for p#rposes of collective
ar!ainin! or to any other conflict or disp#te
et&een le!itimate laor #nions.
FIntra*Hnion =isp#teF refers to any conflict et&een
and amon! #nion memers" incl#din! !rievances
arisin! from any violation of the ri!hts and conditions
of memership" violation of or disa!reement over
any provision of the #nionPs constit#tion and y*la&s"
or disp#tes arisin! from
charterin! or affiliation of #nion.
In interGintra*#nion disp#te the complaint may e
filed y a #nion or #nion memers$ in a 8related laor
relations disp#te9 the complaint may e filed y a
party*in*interest &ho is not necessarily a #nion or
#nion memer.
;hether the disp#te e of the first or the second
cate!ory" the complainant or petition" if it involves an
independent #nion" a chartered local" or a &or'er:s
association" shall e filed &ith the =OLE Re!ional
Office &here the laor or!anization is re!istered. B#t
if the complaint involves a federation or an
ind#stryGnational #nion" it shall e filed &ith the BLR
itself.
3.0 =.O. No. I?*?-
The Order appears to aim the follo&in! specific
o%ectives:
0. to simplify the formation and re!istration of
#nions" especially chartered locals
3. to simplify and e)pedite the holdin! of certification
elections
-. to promote responsile #nionism" partic#larly in
administration of #nion f#nds
I. to a#thorize #nion mer!er" consolidation" and
chan!e of name
1. to a#thorize dere!istration of collective ar!ainin!
a!reements
3.3 Effect of Cendency
Section -. Effects of the filin!Gpendency of interGintra*#nion
and other related laor relations disp#tes. * The ri!hts"
relationships and oli!ations of the parties liti!ants a!ainst
each other and other parties*in*interest prior to the
instit#tion of the petition shall contin#e to remain d#rin!
the pendency of the petition and #ntil the date of finality of
the decision rendered therein.
3.- Appeal
Section 0.. Appeal. * The decision of the 2ed*Ariter and
Re!ional =irector may e appealed to the B#rea# y any
of the parties &ithin ten ,0?6 days from receipt thereof"
copy f#rnished the opposin! party. The decision of the
B#rea# =irector in the e)ercise of hisGher ori!inal
%#risdiction may e appealed to the Office of the Secretary
y any party &ithin the same period" copy f#rnished the
opposin! party.
The appeal shall e verified #nder oath and shall consist
of a memorand#m of appeal specifically statin! the
!ro#nds relied #pon y the appellant" &ith s#pportin!
ar!#ments and evidence.
Section 0/. ;here to file appeal. * The memorand#m of
appeal shall e filed in the Re!ional Office or B#rea#
&here the complaint or petition ori!inated. ;ithin t&enty*
fo#r ,3I6 ho#rs from receipt of the memorand#m of
appeal" the B#rea# or Re!ional =irector shall ca#se the
transmittal thereof to!ether &ith the entire records of the
case to the Office of the Secretary or the B#rea#" as the
case may e.
Section 05. Einality of =ecision. * ;here no appeal is filed
&ithin the ten*day period" the B#rea# and Re!ional
=irector or 2ed*Ariter" as the case may e" shall enter
the finality of the decision in the records of the case and
ca#se the immediate implementation thereof.
Section 04. Ceriod to reply. * A reply to the appeal may e
filed y any party to the complaint or petition &ithin ten
,0?6 days from receipt of the memorand#m of appeal. The
reply shall e filed directly &ith the B#rea# or the Office of
the Secretary" as the case may e.
-- D C L A T O N
LABOR RELATIONS
Section 3?. =ecision of the B#rea#GOffice of the Secretary.
* The B#rea# =irector or the Secretary" as the case may
e" shall have t&enty ,3?6 days from receipt of the entire
records of the case &ithin &hich to decide the appeal. The
filin! of the memorand#m of appeal from the decision of
the 2edAriter or Re!ional =irector and B#rea# =irector
stays the implementation of the assailed decision.
The B#rea# or Office of the Secretary may call the parties
to a clarificatory hearin! in aid of its appellate
%#risdiction.
Section 30. Einality of =ecision of B#rea#GOffice of the
Secretary. * The decision of the B#rea# or the Office of the
Secretary shall ecome final and e)ec#tory after ten ,0?6
days from receipt thereof y the parties" #nless a motion
for its reconsideration is filed y any party therein &ithin
the same period. Only one ,06 motion for reconsideration
of the decision of the B#rea# or the Office of the Secretary
in the e)ercise of their appellate %#risdiction shall e
allo&ed.
Section 33. E)ec#tion of decision. * The decision of the
2ed*Ariter and Re!ional =irector shall a#tomatically e
stayed pendin! appeal &ith the B#rea#. The decision of
the B#rea# in the e)ercise of its appellate %#risdiction shall
e immediately e)ec#tory #pon iss#ance of entry of final
%#d!ment.
The decision of the B#rea# in the e)ercise of its ori!inal
%#risdiction shall a#tomatically e stayed pendin! appeal
&ith the Office of the Secretary. The decision of the Office
of the Secretary shall e immediately e)ec#tory #pon
iss#ance of entry of final %#d!ment.
'. E8TENT OF BLR A/T(ORITY
In the interest of ind#strial peace and for the
promotion of the sal#tary constit#tional o%ectives of
social %#stice and protection to laor" the
competence of the !overnmental entr#sted &ith
s#pervision over disp#tes involvin! employers and
employees as &ell as Finter*#nion and intra*#nion
conflicts"F is road and e)pensive.
). KATAR/N%AN% PA-BARAN%AY3 NOT
APPLICABLE TO LABOR DISP/TES
Cresidential =ecree No. 01?5 applies only to co#rts
of %#stice and not to laor relations commissions or
laor aritrators: offices.
No"e: +onciliation*mediation is no& done y N+2A
not BLR.
Instead of simplifyin! laor proceedin!s desi!ned at
e)peditio#s settlement or referral to the proper co#rt
or office to decide it finally" the position ta'en y the
petitioner &o#ld only d#plicate the conciliation
proceedin!s and #nd#ly delay the disposition of the
laor case.
77777777
Art. 33/. +ompromise a!reements. Any compromise
settlement" incl#din! those involvin! laor standard
la&s" vol#ntarily a!reed #pon y the parties &ith the
assistance of the B#rea# or the re!ional office of the
=epartment of Laor" shall e final and indin! #pon
the parties. The National Laor Relations
+ommission or any co#rt" shall not ass#me
%#risdiction over iss#es involved therein e)cept in
case of non*compliance thereof or if there is prima
facie evidence that the settlement &as otained
thro#!h fra#d" misrepresentation" or coercion.
77777777
1. CO-PRO-ISE A%REE-ENTS
The assistance of the BLR or the re!ional office of
the =OLE in the e)ec#tion of a compromise
settlement is a asic re(#irement$ &itho#t it" there
can e no valid compromise settlement.
The NLR+ or any co#rt shall not ass#me %#risdiction
over iss#es involved therein" e)cept:
a6 in case of noncompliance &ith the compromise
a!reement" or
6 if there is $ri#a %acie evidence that the settlement
&as otained thro#!h fra#d" misrepresentation" or
coercion.
Alon! the same line" the +o#rt reiterated in 3??1:
There are le!itimate &aivers that represent a vol#ntary
and reasonale settlement of a &or'er:s claim &hich
sho#ld e respected y the co#rts as the la& et&een the
parties. Indeed" not all (#itclaims are per se invalid or
a!ainst p#lic policy" e)cept ,06 &here there is clear proof
that the &aiver &as &an!led from an #ns#spectin! or
!#llile person" or ,36 &here the terms of settlement are
#nconscionale on their faces$ in these cases" the la& &ill
step in to ann#l the (#estionale transactions. S#ch
(#itclaims are re!arded as ineffective to ar the &or'ers
from claimin! the f#ll meas#re of their le!al ri!hts.
2. FOR-AL RE2/IRE-ENTS OF CO-PRO-ISE
A%REE-ENT
+ompromise a!reements involvin! laor standards
cases m#st e red#ced to &ritin! and si!ned in the
presence of the Re!ional =irector or his d#ly
a#thorized representative.
'. VALID CO-PRO-ISE AND 2/ITCLAI-
The la& loo's &ith disfavor #pon (#itclaims and
releases y employees &ho are invei!led or
press#red into si!nin! them y #nscr#p#lo#s
employers see'in! to evade their le!al
responsiilities. On the other hand" there are
-I D C L A T O N
LABOR RELATIONS
le!itimate &aivers that represent a vol#ntary
settlement of laorerPs claims that sho#ld e
respected y the co#rts as the la& et&een the
parties.
Not all &aivers and (#itclaims are invalid as a!ainst
p#lic policy. If the a!reement &as vol#ntarily
entered into and represents a reasonale
settlement" it is indin! on the parties and may not
later e diso&ned simply eca#se of a chan!e of
mind. It is only &here there is clear proof that the
&aiver &as &an!led from an #ns#spectin! or !#llile
person" or the terms of settlement are
#nconscionale on its face" that the la& &ill step in
to ann#l the (#estionale transaction. B#t &here it is
sho&n that the person ma'in! the &aiver did so
vol#ntarily" &ith f#ll #nderstandin! of &hat he &as
doin!" and the consideration for the (#itclaim is
credile and reasonale" the transaction m#st e
reco!nized as a valid and indin! #nderta'in!.
). CO-PRO-ISE S(O/LD BE D/LY
A/T(ORI&ED
The a#thority to compromise cannot li!htly e
pres#med and sho#ld e d#ly estalished y
evidence.
0. R/LIN%S ON CO-PRO-ISE SETTLE-ENTS
S/--ARI&ED
5. #(EN TO EFFECT CO-PRO-ISE1 FINAL
DECISION3 NE%OTIABLE:
A compromise a!reement may e effected at any
sta!e of the proceedin!s and even &hen there is
already a final and e)ec#tor %#d!ment.
+. OPTIONS #(EN CO-PRO-ISE
A%REE-ENTS IS VIOLATED
Hnder Article 3?I0 of the +ivil +ode" sho#ld a party
fail or ref#se to comply &ith the terms of a
compromise or amicale settlement" the other party
co#ld either: ,06 enforce the compromise y a &rit of
e)ec#tion" or ,36 re!ard it as rescinded and so insist
#pon his ori!inal demand.
77777777
LArt. 335. Indorsement of cases to Laor Ariters.
a. E)cept as provided in para!raph ,6 of this Article"
the Laor Ariter shall entertain only cases endorsed
to him for comp#lsory aritration y the B#rea# or y
the Re!ional =irector &ith a &ritten notice of s#ch
indorsement or non*indorsement. The indorsement
or non*indorsement of the Re!ional =irector may e
appealed to the B#rea# &ithin ten ,0?6 &or'in! days
from receipt of the notice.

. The parties may" at any time" y m#t#al
a!reement" &ithdra& a case from the +onciliation
Section and %ointly s#mit it to a Laor Ariter"
e)cept deadloc's in collective ar!ainin!.M,Repealed
y Section 0." Batas Camansa Bilan! 0-?" A#!#st
30" 04506
77777777
Art. 334. Iss#ance of s#poenas. The B#rea# shall
have the po&er to re(#ire the appearance of any
person or the prod#ction of any paper" doc#ment or
matter relevant to a laor disp#te #nder its
%#risdiction" either at the re(#est of any interested
party or at its o&n initiative.
77777777
Art. 3-?. Appointment of #rea# personnel. The
Secretary of Laor and Employment may appoint" in
addition to the present personnel of the B#rea# and
the Ind#strial Relations =ivisions" s#ch n#mer of
e)aminers and other assistants as may e
necessary to carry o#t the p#rpose of the +ode. ,As
amended y Section 01" Rep#lic Act No. ./01"
2arch 30" 04546
77777777
Art. 3-0. Re!istry of #nions and file of collective
ar!ainin! a!reements. The B#rea# shall 'eep a
re!istry of le!itimate laor or!anizations. The
B#rea# shall also maintain a file of all collective
ar!ainin! a!reements and other related
a!reements and records of settlement of laor
disp#tes and copies of orders and decisions of
vol#ntary aritrators. The file shall e open and
accessile to interested parties #nder conditions
prescried y the Secretary of Laor and
Employment" provided that no specific information
s#mitted in confidence shall e disclosed #nless
a#thorized y the Secretary" or &hen it is at iss#e in
any %#dicial liti!ation" or &hen p#lic interest or
national sec#rity so re(#ires.
;ithin thirty ,-?6 days from the e)ec#tion of a
+ollective Bar!ainin! A!reement" the parties shall
s#mit copies of the same directly to the B#rea# or
the Re!ional Offices of the =epartment of Laor and
Employment for re!istration" accompanied &ith
verified proofs of its postin! in t&o conspic#o#s
places in the place of &or' and ratification y the
ma%ority of all the &or'ers in the ar!ainin! #nit. The
B#rea# or Re!ional Offices shall act #pon the
application for re!istration of s#ch +ollective
Bar!ainin! A!reement &ithin five ,16 calendar days
-1 D C L A T O N
LABOR RELATIONS
from receipt thereof. The Re!ional Offices shall
f#rnish the B#rea# &ith a copy of the +ollective
Bar!ainin! A!reement &ithin five ,16 days from its
s#mission.
The B#rea# or Re!ional Office shall assess the
employer for every +ollective Bar!ainin! A!reement
a re!istration fee of not less than one tho#sand
pesos ,C0"???.??6 or in any other amo#nt as may e
deemed appropriate and necessary y the Secretary
of Laor and Employment for the effective and
efficient administration of the Aol#ntary Aritration
Cro!ram. Any amo#nt collected #nder this provision
shall accr#e to the Special Aol#ntary Aritration
E#nd.
The B#rea# shall also maintain a file and shall
#nderta'e or assist in the p#lication of all final
decisions" orders and a&ards of the Secretary of
Laor and Employment" Re!ional =irectors and the
+ommission. ,As amended y Section 01" Rep#lic
Act No. ./01" 2arch 30" 04546
77777777
RE%ISTRY OF /NIONS AND CBA,
The B#rea# shall 'eep a re!istry of le!itimate laor
or!anizations.
The B#rea# shall also maintain a file of all +ollective
Bar!ainin! A!reements ,+BAs6 and other related
a!reements.
77777777
Art. 3-3. Crohiition on certification election. The
B#rea# shall not entertain any petition for
certification election or any other action &hich may
dist#r the administration of d#ly re!istered e)istin!
collective ar!ainin! a!reements affectin! the
parties e)cept #nder Articles 31-" 31-*A and 31. of
this +ode. ,As amended y Section 01" Rep#lic Act
No. ./01" 2arch 30" 04546
77777777
T(E CONTRACT.BAR R/LE
Article 3-3 spea's of the contract*ar r#le &hich
means that &hile a valid and re!istered +BA is
s#sistin!" the B#rea# is not allo&ed to hold an
election contestin! the ma%ority stat#s of the
inc#ment #nion. The e)istence of the +BA does not
allo&" that is" it ars" the holdin! of the inter*#nion
electoral contest. The election is le!ally allo&ed"
says Art. 31." only d#rin! the 8freedom period9 &hich
refers to the last .? days of the fifth year of a +BA.
The o%ective of the r#le" ovio#sly" is to minimize
#nion 8politic'in!9 #ntil the proper time comes.
77777777
Art. 3--. Crivile!ed comm#nication. Information and
statements made at conciliation proceedin!s shall
e treated as privile!ed comm#nication and shall not
e #sed as evidence in the +ommission.
+onciliators and similar officials shall not testify in
any co#rt or ody re!ardin! any matters ta'en #p at
conciliation proceedin!s cond#cted y them.
77777777
Title IV
LABOR OR%ANI&ATIONS
Chapter I
RE%ISTRATION AND CANCELLATION
Art. 3-I. Re(#irements of Re!istration. * A
federation" national #nion or ind#stry or trade #nion
center or an independent #nion shall ac(#ire le!al
personality and shall e entitled to the ri!hts and
privile!es !ranted y la& to le!itimate laor
or!anizations #pon iss#ance of the certificate of
re!istration ased on the follo&in! re(#irements:
,a6 Eifty pesos ,C1?.??6 re!istration fee$
,6 The names of its officers" their addresses" the
principal address of the laor or!anization" the
min#tes of the or!anizational meetin!s and the list of
the &or'ers &ho participated in s#ch meetin!s$
,c6 In case the applicant is an independent #nion"
the names of all its memers comprisin! at least
t&enty percent ,3?U6 of all the employees in the
ar!ainin! #nit &here it see's to operate$
,d6 If the applicant #nion has een in e)istence for
one or more years" copies of its ann#al financial
reports$ and
,e6 Eo#r copies of the constit#tion and y*la&s of the
applicant #nion" min#tes of its adoption or
ratification" and the list of the memers &ho
participated in it. ,As amended y Rep#lic Act No.
4I50" 2ay 31" 3??/6
77777777
Art. 3-I*A. +harterin! and +reation of a Local
+hapter. * A d#ly re!istered federation or national
#nion may directly create a local chapter y iss#in!
a charter certificate indicatin! the estalishment of
the local chapter. The chapter shall ac(#ire le!al
personality only for p#rposes of filin! a petition for
certification election from the date it &as iss#ed a
charter certificate.
The chapter shall e entitled to all other ri!hts and
privile!es of a le!itimate laor or!anization only
-. D C L A T O N
LABOR RELATIONS
#pon the s#mission of the follo&in! doc#ments in
addition to its charter certificate:
,a6 The names of the chapterPs officers" their
addresses" and the principal office of the chapter$
and
,6 The chapterPs constit#tion and y*la&s: Crovided"
That &here the chapterPs constit#tion and y*la&s
are the same as that of the federation or the national
#nion" this fact shall e indicated accordin!ly.
The additional s#pportin! re(#irements shall e
certified #nder oath y the secretary or treas#rer of
the chapter and attested y its president.
77777777
Art. 3-1. Action on application. The B#rea# shall act
on all applications for re!istration &ithin thirty ,-?6
days from filin!.
All re(#isite doc#ments and papers shall e certified
#nder oath y the secretary or the treas#rer of the
or!anization" as the case may e" and attested to y
its president.
77777777
Art. 3-.. =enial of re!istration$ appeal. The decision
of the Laor Relations =ivision in the re!ional office
denyin! re!istration may e appealed y the
applicant #nion to the B#rea# &ithin ten ,0?6 days
from receipt of notice thereof.
77777777
Art. 3-/. Additional re(#irements for federations or
national #nions. S#%ect to Article 3-5" if the
applicant for re!istration is a federation or a national
#nion" it shall" in addition to the re(#irements of the
precedin! Articles" s#mit the follo&in!:
a. Croof of the affiliation of at least ten ,0?6 locals or
chapters" each of &hich m#st e a d#ly reco!nized
collective ar!ainin! a!ent in the estalishment or
ind#stry in &hich it operates" s#pportin! the
re!istration of s#ch applicant federation or national
#nion$ and

. The names and addresses of the companies
&here the locals or chapters operate and the list of
all the memers in each company involved.
77777777
LArt. 3-5. +onditions for re!istration of federations or
national #nions. No federation or national #nion shall
e re!istered to en!a!e in any or!anization activity
in more than one ind#stry in any area or re!ion" and
no federation or national #nion shall e re!istered to
en!a!e in any or!anizational activity in more than
one ind#stry all over the co#ntry.
The federation or national #nion &hich meets the
re(#irements and conditions herein prescried may
or!anize and affiliate locals and chapters &itho#t
re!isterin! s#ch locals or chapters &ith the B#rea#.
Locals or chapters shall have the same ri!hts and
privile!es as if they &ere re!istered in the B#rea#"
provided that s#ch federation or national #nion
or!anizes s#ch locals or chapters &ithin its assi!ned
or!anizational field of activity as may e prescried
y the Secretary of Laor.
The B#rea# shall see to it that federations and
national #nions shall only or!anize locals and
chapters &ithin a specific ind#stry or #nion.M
,Repealed y E)ec#tive Order No. 000" =ecemer
3I" 045.6
77777777
1. LABOR OR%ANI&ATION1 T#O BROAD
P/RPOSES
A 8laor or!anization9 is not al&ays a #nion$ it may
e an 8association of employees.9 And" the p#rpose
is not only or necessarily 8collective ar!ainin!9 #t
also dealin! &ith employers concernin! terms and
conditions of employment.
FLaor Or!anizationF refers to any #nion or
association of employees in the private sector &hich
e)ists in &hole or in part for the p#rpose of collective
ar!ainin!" m#t#al aid" interest" cooperation"
protection" or other la&f#l p#rposes.
FLe!itimate Laor Or!anizationF refers to any laor
or!anization in the private sector re!istered or
reported &ith the =epartment in accordance &ith
R#les III and IA of these R#les.
FHnionF refers to any laor or!anization in the private
sector or!anized for collective ar!ainin! and for
other le!itimate p#rposes.
;e sho#ld note that not every #nion is 8le!itimate$9
only those properly re!istered are considered LLO.
B#t non*re!istration does not mean it is 8ille!itimate$9
it simply is #nre!istered and has no le!al personality.
It e)ists le!ally #t does not possess the ri!hts of an
LLO.
FE)cl#sive Bar!ainin! RepresentativeF refers to a
le!itimate laor #nion d#ly reco!nized or certified as
the sole and e)cl#sive ar!ainin! representative or
a!ent of all the employees in a ar!ainin! #nit.
F;or'ersP AssociationF refers to an association of
&or'ers or!anized for the m#t#al aid and protection
-/ D C L A T O N
LABOR RELATIONS
of its memers or for any le!itimate p#rpose other
than collective ar!ainin!.
FLe!itimate ;or'ersP AssociationF refers to an
association of &or'ers or!anized for m#t#al aid and
protection of its memers or for any le!itimate
p#rpose other than collective ar!ainin! re!istered
&ith the =epartment in accordance &ith R#le III"
Sections 3*+ and 3*= of these R#les.
0.0 =istinction Bet&een 8+ollective Bar!ainin!9 and
8=ealin! &ith Employer9
To ar!ain collectively is a ri!ht that may e
ac(#ired y a laor or!anization after re!isterin!
itself &ith the =epartment of Laor and Employment
and after ein! reco!nized or certified y =OLE as
the e)cl#sive ar!ainin! representative ,EBR6 of the
employees.
=ealin! &ith employer" on the other hand" is a
!eneric description of interaction et&een employer
and employees concernin! !rievances" &a!es" &or'
ho#rs and other terms and conditions of
employment" even if the employee:s !ro#p is not
re!istered &ith the =epartment of Laor and
Employment.
2. CLASSIFICATION OF LABOR
OR%ANI&ATIONS
FNational HnionGEederationF means any laor
or!anization &ith at least ten ,0?6 locals or chapters
each of &hich m#st e a d#ly reco!nized collective
ar!ainin! a!ent.
8Ind#stry Hnion9 means any !ro#p of le!itimate laor
or!anizations operatin! &ithin an identified ind#stry"
or!anized for collective ar!ainin! or for dealin! &ith
employers concernin! terms and conditions of
employment &ithin an ind#stry" or for participatin! in
the form#lation of social and employment policies"
standards and pro!rams in s#ch ind#stry" &hich is
d#ly re!istered &ith the =epartment. =.O. No. I?*?-"
ho&ever" does not carry this term and this definition"
altho#!h #nder R#le III" Section 3*B" 8laor
or!anizations operatin! &ithin an identified ind#stry
may also apply for re!istration as a federation or
national #nion &ithin the specified ind#stry y
s#mittin! to the B#rea# the same set of doc#ments
,as re(#ired of federations and national #nions.69
8Trade Hnion +enter9 means any !ro#p of re!istered
national #nions or federations or!anized for the
m#t#al aid and protection of its memers" for
assistin! s#ch memers in collective ar!ainin!" or
for participatin! in the form#lation of social and
employment policies" standards and pro!rams"
&hich is d#ly re!istered &ith the =epartment.
An 8alliance9 is an a!!re!ation of #nions e)istin! in
one line of ind#stry" or in a con!lomerate" a !ro#p of
franchises" a !eo!raphical area" or an ind#strial
center.
A 8company*#nion9 is a laor or!anization &hich" in
&hole or in part" is employer*controlled or employer*
denominated. Article 3I5,d6 prohiits ein! a
company #nion.
3.0 Hnions at Enterprise Level
A laor #nion at the enterprise level may e created
either y ,a6 independent re!istration or ,6
charterin!. Independent re!istration is otained y
the #nion or!anizers in an enterprise thro#!h their
o&n action instead of thro#!h iss#ance of a charter
y a federation or national #nion. An independent
#nion has a le!al personality of its o&n not derived
from that of a federation.
FIndependent HnionF refers to a laor or!anization
operatin! at the enterprise level that ac(#ired le!al
personality thro#!h independent re!istration #nder Article
3-I of the Laor +ode and R#le III" Section 3*A of these
R#les.
+harterin!" on the other hand" ta'es place &hen a
d#ly re!istered federation or national #nion iss#e a
charter to a #nion in an enterprise and re!isters the
creation of the chapter &ith the Re!ional Office
&here the applicants operates. The #nion recipient
of the charter s called a chapter or local or chartered
local. Its le!al personality is derived from the
federationG national #nion #t it may s#se(#ently
re!ister itself independently.
'. RE%ISTRATION RATIONALE
A laor or!anization may e re!istered or not. If
re!istered &ith =OLE" it is considered 8le!itimate
laor or!anization9 ,LLO6. B#t the reverse #s not
tr#e" that is" a laor or!anization is not 8ille!itimate9
%#st eca#se it is #nre!istered. It is still la&f#l
or!anization and can deal &ith the employer" #t it
has no le!al personality to demand collective
ar!ainin! &ith the employer. It cannot petition for a
certification election and cannot hold a le!al stri'e.
Re!istration is merely a condition ine *ua non for
the ac(#isition of le!al personality y laor
or!anizations" associations or #nions and the
possession of the ri!hts and privile!es !ranted y
la& to le!itimate laor or!anizations.
S#ch re(#irement is a valid e)ercise of the police
po&er" eca#se the activities in &hich laor
or!anizations" associations and #nion of &or'ers are
-5 D C L A T O N
LABOR RELATIONS
en!a!ed affect p#lic interest" &hich sho#ld e
protected.
-.0 Effect of Re!istration Hnder the +orporation La&
A laor or!anization may e or!anized #nder the
+orporation La& as a non*stoc' corporation and
iss#ed a certificate of incorporation y the Sec#rities
and E)chan!e +ommission. B#t s#ch incorporation
has only the effect of !ivin! to it %#ridical personality
efore re!#lar co#rts of %#stice. S#ch incorporation
does not !rant the ri!hts and privile!es of a
le!itimate laor or!anization.
). #(ERE TO RE%ISTER
Applications for re!istration of independent laor
#nions" chartered locals" and &or'er:s association
shall e filed &ith the Re!ional Office &here the
applicant principally operates.
If the Re!ional Office denies the application" the
denial is appealale to the B#rea# and from there to
the +o#rt of Appeals ,not to the Secretary of Laor6
if proper !ro#nds e)ist.
0. RE%ISTRATION RE2/IRE-ENTS
1.0 Independent Laor Hnion
Section 3. Re(#irements for application. * A. The
application for re!istration of an independent laor #nion
shall e accompanied y the follo&in! doc#ments:
,a6 the name of the applicant laor #nion" its principal
address" the name of its officers and their respective
addresses" appro)imate n#mer of employees in the
ar!ainin! #nit &here it see's to operate" &ith a statement
that it is not reported as a chartered local of any federation
or national #nion$
,6 the min#tes of the or!anizational meetin!,s6 and the
list of employees &ho participated in the said meetin!,s6$
,c6 the name of all its memers comprisin! at least 3?U of
the employees in the ar!ainin! #nit$
,d6 the ann#al financial reports if the applicant has een in
e)istence for one or more years" #nless it has not
collected any amo#nt from the memers" in &hich case a
statement to this effect shall e incl#ded in the application$
,e6 the applicantPs constit#tion and y*la&s" min#tes of its
adoption or ratification" and the list of the memers &ho
participated in it. The list of ratifyin! memers shall e
dispensed &ith &here the constit#tion and y*la&s &as
ratified or adopted d#rin! the or!anizational meetin!. In
s#ch a case" the fact#al circ#mstances of the ratification
shall e recorded in the min#tes of the or!anizational
meetin!,s6.
1.3 Eederation or National Hnion
B. The application for re!istration of federations and
national #nions shall e accompanied y the follo&in!
doc#ments:
,a6 a statement indicatin! the name of the applicant laor
#nion" its principal address" the name of its officers and
their respective addresses$
list of employees &ho participated in the said meetin!,s6$
,c6 the ann#al financial reports if the applicant #nion has
een in e)istence for one or more years" #nless it has not
,d6 the applicant #nionPs constit#tion and y*la&s" min#tes
of its adoption or ratification" and the list of the memers
&ho participated in it. The list of ratifyin! memers shall e
dispensed &ith &here the constit#tion and y*la&s &as
ratified or adopted d#rin! the or!anizational meetin!,s6. In
s#ch a case" the fact#al circ#mstances of the ratification
shall e recorded in the min#tes of the or!anizational
meetin!,s6$
,e6 the resol#tion of affiliation of at least ten ,0?6 le!itimate
laor or!anizations" &hether independent #nions or
chartered locals" each of &hich m#st e a d#ly certified or
reco!nized ar!ainin! a!ent in the estalishment &here it
see's to operate$ and
,f6 the name and addresses of the companies &here the
affiliates operate and the list of all the memers in each
company involved.
Laor or!anizations operatin! &ithin an identified ind#stry
may also apply for re!istration as a federation or national
#nion &ithin the specified ind#stry y s#mittin! to the
B#rea# the same set of doc#ments.
1.- ;or'er:s Association
+. The application for re!istration of a &or'ersP association
,a6 the name of the applicant association" its principal
address" the name of its officers and their respective
addresses$
list of memers &ho participated therein$
,c6 the financial reports of the applicant association if it has
een in e)istence for one or more years" #nless it has not
,d6 the applicantPs constit#tion and y*la&s to &hich m#st
e attached the names of ratifyin! memers" the min#tes
of adoption or ratification of the constit#tion and y*la&s
and the date &hen ratification &as made" #nless
ratification &as done in the or!anizational meetin!,s6" in
&hich case s#ch fact shall e reflected in the min#tes of
the or!anizational meetin!,s6.
-4 D C L A T O N
LABOR RELATIONS
1.I +hartered Local
1.Ia ;hen =oes a +hartered Local Become an LLO
The ac(#isition of le!al personality cannot e the
da"e o% %iling of the doc#ments. Section -
,=epartment Order No. 4" 044/6 &as defeatin! the
very p#rpose of re!istration of #nions &hich &as to
loc' off fly*y*ni!ht #nions.
1.I ;hen =oes a +hartered Local Ac(#ire Le!al
Cersonality #nder =.O. No. I?" Series of 3??-
Section 5. Effect of re!istration. * The laor #nion or
&or'ersP association shall e deemed re!istered and
vested &ith le!al personality on the date of iss#ance of its
certificate of re!istration or certificate of creation of
chartered local
The determinative date no& is not the date the
re(#ired doc#ments &ere filed #t the date the
certificate &as iss#ed. And the date of iss#ance is
li'ely to e the date the doc#ments &ere filed
eca#se =.O. No. I?*=*?1" s#pplementin! =.O. No.
I?*?-" re(#ires the Re!ional Office or the B#rea# to
either approve or deny the application for re!istration
8&ithin one ,06 day from receipt thereof.9
1.Ic Reco!nition y BLR not a 2inisterial =#ty
1.Id +hartered Local Nas to e Re!istered$
Re(#irements
1.Ie Re!istration Re(#irements for a +hartered
Local
E. A d#ly*re!istered federation or national #nion may
directly create a chartered local y s#mittin! to the
Re!ional Office t&o ,36 copies of the follo&in!:
,a6 A charter certificate iss#ed y the federation or national
#nion indicatin! the creation or estalishment of the
localGchapter$
,6 The names of the localGchapter:s officers" their
addresses" and the principal office of the localGchapter$
and
,c6 The localGchapter:s constit#tion and y*la&s" provided
that &here the localGchapter:s constit#tion and y*la&s is
the same as that of the federation or national #nion" this
fact shall e indicated accordin!ly.
All of the fore!oin! s#pportin! re(#irements shall e
certified #nder oath y the Secretary or the Treas#rer of
the localGchapter and attested y its Cresident. ,As
amended y =O I?*B*?-.6
1.If Re(#irements Rela)ed
The creation of a local does not need s#scription y
a minim#m n#mer of memers. The 3? percent
initial memership mentioned in Article 3-I,c6 is
re(#ired of an independent #nion #t not of a
chartered local.
1.1 Hnion:s Le!itimacy not S#%ect to +ollateral
Attac'
S#ch le!al personality may e (#estioned only thro#!h an
independent petition for cancellation of #nion re!istration
in accordance &ith R#le SIA of these R#les" and not y
&ay of collateral attac' in petition for certification election
proceedin!s #nder R#le AIII.
5. COLLECTIVE BAR%AININ% /NIT <CB/=
FBar!ainin! HnitF refers to a !ro#p of employees
sharin! m#t#al interests &ithin a !iven employer
#nit" comprised of all or less than all of the entire
ody of employees in the employer #nit or any
specific occ#pational or !eo!raphical !ro#pin! &ithin
s#ch employer #nit.
;hile officers lead and represent a #nion" a #nion
represents a +BH. The representative is the #nion$
the !ro#p represented is the +BH. The
representative #nion" once determined" &ill
represent even the memers of other #nions as lon!
as they are part of the +BH. This is &hy the
representative #nion ,also called ar!ainin! a!ent or
ma%ority #nion6 is called 8e)cl#sive ar!ainin!
representative9 ,EBR6.
+. CONSTIT/ION3 BY.LA#S3 AND RE%/LATIONS
Li'e other vol#ntary associations" laor #nions have
the ri!ht to adopt constit#tions" r#les" and y*la&s
&ithin the scope of the la&f#l p#rposes of the #nion
and ind their memers therey" provided they are
reasonale" #niform" and not discriminatory" and
provided they are not contrary to p#lic policy or the
la& of the land.
The articles of a!reement of a laor #nion" &hether
called a constit#tion" charter" y*la&s" or any other
name" constit#tes a contract et&een the memers
&hich the co#rts &ill enforce" if not immoral or
contrary to p#lic policy or the la& of the land.
A #nion:s constit#tion and y*la&s !overn the
relationship et&een and amon! its memers. As in
the interpretation of contracts" if the terms are clear
and leave no do#t as to the intentions of the
parties" the literal meanin! of the stip#lation shall
control.
/.0 Limitation to By*la&s
I? D C L A T O N
LABOR RELATIONS
Hnder Art. 3-I,e6 it is implied that the memers are
the ones to adopt or ratify the #nion:s constit#tion
and y*la&s. It ein! a !overnin! la& of the #nion"
the +BL sho#ld e democratically ratified.
/.3 Amendments
A #nion:s constit#tion and y*la&s may e amended"
modified and e)tended y the d#ly constit#ted #nion
a#thorities #nder the la&s of the state" In the
asence of other re(#irements" and s#%ect to
vested ri!hts" a #nion constit#tion may e made"
chan!ed" #nmade" or s#perseded y a ma%ority vote
of the memers or its constit#ent ody.
Hnder Art. 3I0,d6" ma%or policy (#estions are to e
delierated #pon and decided y secret allot y the
memers.
*. PROVISIONS CO--ON TO T(E
RE%ISTRATION OF LABOR OR%ANI&ATIONS
AND #ORKER$S ASSOCIATION
5.0 Attestation" Eee" +opies of =oc#ments
Section 0. Attestation re(#irements. * The application for
re!istration of laor #nions and &or'ersP associations"
notice for chan!e of name" mer!er" consolidation and
affiliation incl#din! all the accompanyin! doc#ments" shall
e certified #nder oath y its Secretary or Treas#rer" as
the case may e" and attested to y its Cresident.
Section -. Accompanyin! doc#ments. * One ,06 ori!inal
copy and t&o ,36 d#plicate copies of all doc#ments
accompanyin! the application or notice shall e s#mitted
to the Re!ional Office or the B#rea#.
5.3 Action on the ApplicationGNotices
Section I. Action on the applicationGnotice. * The Re!ional
Office or the B#rea#" as the case may e" shall act on all
applications for re!istration or notice of chan!e of name"
affiliation" mer!er and consolidation &ithin ten ,0?6 days
from receipt either y: ,a6 approvin! the application and
iss#in! the certificate of re!istrationGac'no&led!in! the
noticeGreport$ or ,6 denyin! the applicationGnotice for
fail#re of the applicant to comply &ith the re(#irements for
re!istrationGnotice.
5.- =enial of ApplicationGRet#rn of Notice
Section 1. =enial of ApplicationGRet#rn of Notice. * ;here
the doc#ments s#pportin! the application for
re!istrationGnotice of chan!e of name" affiliation" mer!er
and consolidation are incomplete or do not contain the
re(#ired certification and attestation" the Re!ional Office
or the B#rea# shall" &ithin five ,16 days from receipt of the
applicationGnotice" notify the applicantGlaor or!anization
concerned in &ritin! of the necessary re(#irements and
complete the same &ithin thirty ,-?6 days from receipt of
notice. ;here the applicantGlaor or!anization concerned
fails to complete the re(#irements &ithin the time
prescried" the application for re!istration shall e denied"
or the notice of chan!e of name" affiliation" mer!er and
consolidation ret#rned" &itho#t pre%#dice to filin! a ne&
application or notice.
Section .. Eorm of =enial of ApplicationGRet#rn of Notice$
Appeal. * The notice of the Re!ional Office or the B#rea#
denyin! the application for re!istrationGret#rnin! the notice
of chan!e of name" affiliation" mer!er or consolidation
shall e in &ritin! statin! in clear terms the reasons for the
denial or ret#rn.
5.I Appeal
Section .. Eorm of =enial of ApplicationGRet#rn of Notice$
Appeal. * The denial may e appealed to the B#rea# if
denial is made y the Re!ional Office or to the Secretary if
denial is made y the B#rea#" &ithin ten ,0?6 days from
receipt of s#ch notice" on the !ro#nd of !rave a#se of
discretion or violation of these R#les.
Section /. Croced#re on appeal. * The memorand#m of
appeal shall e filed &ith the Re!ional Office or the
B#rea# that iss#ed the denialGret#rn of notice. The
memorand#m of appeal to!ether &ith the complete
records of the application for re!istrationGnotice of chan!e
of name" affiliation" mer!er or consolidation" shall e
transmitted y the Re!ional Office to the B#rea# or y the
B#rea# to the Office of the Secretary" &ithin t&enty*fo#r
,3I6 ho#rs from receipt of the memorand#m of appeal.
The B#rea# or the Office of the Secretary shall decide the
appeal &ithin t&enty ,3?6 days from receipt of the records
of the case.
6. AFFILIATION
An affiliate is an independently re!istered #nion that
enters into an a!reement of affiliation &ith a
federation or a national #nion. It also refers to a
chartered local &hich applies for and is !ranted an
independent re!istration #t does not disaffiliate
from its mother federation or national #nion.
A #nion" either an independent or a local" affiliates
&ith a federation or national #nion for a n#mer of
reasons. The most common ones are to sec#re
s#pport or assistance partic#larly d#rin! the
formative sta!e of #nionization$ or to #tilize e)pertise
in preparin! and p#rs#in! ar!ainin! proposals$ or
to marshal mind and manpo&er in the co#rse of a
!ro#p action s#ch as stri'e.
The relationship et&een a local or chapter and the
laor federation or national #nion is !enerally
#nderstood to e that of a!ency" &here the local is
the principal and the federation the a!ent.
4.0 Report of Affiliation$ Re(#irements
Section .. Report of Affiliation &ith federations or national
#nions$ ;here to file. * The report of affiliation of an
I0 D C L A T O N
LABOR RELATIONS
independently re!istered laor #nion &ith a federation or
national #nion shall e filed &ith the Re!ional Office that
iss#ed its certificate of re!istration.
Section /. Re(#irements of affiliation. * The report of
affiliation of independently re!istered laor #nions &ith a
federation or national #nion shall e accompanied y the
follo&in! doc#ments:
,a6 resol#tion of the laor #nionPs oard of directors
approvin! the affiliation$
,6 min#tes of the !eneral memership meetin! approvin!
the affiliation$
,c6 the total n#mer of memers comprisin! the laor
#nion and the names of memers &ho approved the
affiliation$
,d6 the certificate of affiliation iss#ed y the federation in
favor of the independently re!istered laor #nion$ and
,e6 &ritten notice to the employer concerned if the
affiliatin! #nion is the inc#ment ar!ainin! a!ent.
17. DISAFFILIATION
The sole essence of affiliation is to increase" y
collective action" the common ar!ainin! po&er of
local #nions for the effective enhancement and
protection of their interests. Admittedly" there are
times &hen &itho#t s#ccor and s#pport local #nions
may find it hard" #naided y other s#pport !ro#ps" to
sec#re %#stice for themselves.
Oet the local #nions remain the asic #nits of
association" free to serve their o&n interests s#%ect
to the restraints imposed y the constit#tion and y*
la&s of the national federation" and free also to
reno#nce the affiliation #pon the terms laid do&n in
the a!reement &hich ro#!ht s#ch affiliation into
e)istence.
To disaffiliate is a ri!ht" #t to oserve the terms of
affiliation is an oli!ation
0?.0 Local Hnion is the Crincipal" Eederation the
A!ent
=isaffiliation of employees from their mother #nion
and their formation into a ne& #nion do not terminate
their stat#s as employees of the corporation" as the
employees and memers of the local #nion did not
form a ne& #nion #t merely e)ercised their ri!ht to
re!ister their local #nion.
0?.3 ;hen to =isaffiliate
;hile it is tr#e that a local #nion is free to serve the
interest of all its memers and en%oys the freedom to
disaffiliate" s#ch ri!ht to disaffiliate may e e)ercised
and is th#s considered a protected laor activity only
&hen &arranted y circ#mstances. >enerally" a
laor #nion may disaffiliate from the mother #nion to
form a local or independent #nion only d#rin! the .?*
day freedom period immediately precedin! the
e)piration of the +BA.
The 8freedom period9 refers to the last .?*days of
the fifth and last year of a +BA.
B#t even efore the onset of the freedom period
,and despite the closed*shop provision in the +BA
et&een the mother #nion and mana!ement6
disaffiliation may still e carried o#t" #t s#ch
disaffiliation m#st e effected y a ma%ority of the
memers in the ar!ainin! #nit.
This r#lin! is tr#e ONLO if the contract of affiliation
does not specify the period for possile disaffiliation.
0?.- =isaffiliation m#st e y 2a%ority =ecision
Article 3I0,d6 applies to disaffiliation" th#s" it has to
e decided y the entire memership thro#!h secret
allotin!.
0?.I =isaffiliation: Effect on Le!al Stat#s
;hen a #nion &hich is not independently re!istered
disaffiliates from the federation" it is not entitled to
the ri!hts and privile!es !ranted to a le!itimate laor
or!anization. It cannot file a petition for certification
election.
0?.1 =isaffiliation: Effect on Hnion =#es
The oli!ation of an employee to pay #nion d#es is
cotermino#s &ith his affiliation or memership.
A contract et&een an employer and the parent
or!anization as ar!ainin! a!ent for the employees
is terminated y the disaffiliation of the local of &hich
the employees are memers.
0?.. =isaffiliation: Effect on E)istin! +BA$ the
8S#stit#tionary9 =octrine
The 8s#stit#tionary doctrine9 provides that the
employees cannot revo'e the validly e)ec#ted
collective ar!ainin! contract &ith their employer y
the simple e)pedient of chan!in! their ar!ainin!
a!ent. The ne& a!ent m#st respect the contract.
11. REVOCATION OF C(ARTER
A federation" national #nion or &or'ers: association
may revo'e the charter iss#ed to a localGchapter or
ranch y servin! on the latter a verified notice of
revocation" copy f#rnished the B#rea#" on the
I3 D C L A T O N
LABOR RELATIONS
!ro#nd of disloyalty or s#ch other !ro#nds as may
e specified in the constit#tion and yla&s of the
federation" national #nion or &or'ers: association.
The revocation shall divest the localGchapter of its
le!al personality #pon receipt of the notice y the
B#rea#" #nless in the meantime the localGchapter
has ac(#ired independent re!istration in accordance
&ith these R#les.
00.0 Effect of +ancellation of Re!istration of
Eederation or National Hnion on LocalsG+hapter
The cancellation of re!istration of a federation or
national #nion shall operate to divest its
localGchapter of their stat#s as le!itimate laor
or!anizations" #nless the localsGchapters are
covered y a d#ly re!istered collective ar!ainin!
a!reement.
12 -ER%ER AND CONSOLIDATION
Section 0?. Effect of mer!er or consolidation. * ;here
there is a mer!er of laor or!anizations" the le!al
e)istence of the asored laor or!anization,s6 ceases"
&hile the le!al e)istence of the asorin! laor
or!anization s#sists. All the ri!hts" interests and
oli!ations of the asored laor or!anizations are
transferred to the asorin! or!anization.
;here there is consolidation" the le!al e)istence of the
consolidatin! laor or!anizations shall cease and a ne&
laor or!anization is created. The ne&ly created laor
or!anization shall ac(#ire all the ri!hts" interests and
oli!ations of the consolidatin! laor or!anizations.
+onsolidation #s#ally occ#rs et&een t&o #nions
that are appro)imately the same size" &hereas
mer!er often involves a lar!er #nion mer!in! &ith a
smaller #nion.
;hy do #nions mer!eR They mer!e for reasons
similar to those ehind corporate mer!ers.
Eirst" a small #nion may mer!e &ith a lar!er #nion in
order to !ain access to !reater reso#rces and
e)pertise.
Second" #nions that have traditionally competed &ith
each other for memers may mer!e in order to
eliminate inter*or!anizational conflicts.
Third" #nions &hose memers: s'ills have een
o#tmoded y technolo!ical and economic chan!es
may mer!e &ith a stron!er #nion in order to maintain
%o sec#rity and instit#tional s#rvival.
03.0 Notice of 2er!erG+onsolidation of Laor
Or!anizations:$ ;here to Eile
Section 5. Notice of 2er!erG+onsolidation of laor
or!anizations$ ;here to file. * Notice of mer!er or
consolidation of independent laor #nions" chartered
locals and &or'ersP associations shall e filed &ith and
recorded y the Re!ional Office that iss#ed the certificate
of re!istrationGcertificate of creation of chartered local of
either the mer!in! or consolidatin! laor or!anization.
Notice of mer!er or consolidation of federations or national
#nions shall e filed &ith and recorded y the B#rea#.
03.3 Re(#irements of Notice of
2er!erG+onsolidation
The notice of mer!er of laor or!anizations shall e
accompanied y the follo&in! doc#ments:
,a6 the min#tes of mer!er convention or !eneral
memership meetin!,s6 of all the mer!in! laor
or!anizations" &ith the list of their respective memers
&ho approved the same$ and
,6 the amended constit#tion and y*la&s and min#tes of
its ratification" #nless ratification transpired in the mer!er
convention" &hich fact shall e indicated accordin!ly.
03.- +ertificate of Re!istration
Section 0?. +ertificate of Re!istration. * The certificate of
re!istration iss#ed to mer!ed laor or!anizations shall
ear the re!istration n#mer of one of the mer!in! laor
or!anizations as a!reed #pon y the parties to the mer!er.
The certificate of re!istration shall indicate the follo&in!:
,a6 the ne& name of the mer!ed laor or!anization$ ,6 the
fact that it is a mer!er of t&o or more laor or!anizations$
,c6 the name of the laor or!anizations that &ere mer!ed$
,d6 its office or #siness address$ and ,e6 the date &hen
each of the mer!in! laor or!anization.
1'. C(AN%E OF NA-E
Section -. Notice of chan!e of name of laor
or!anizations$ ;here to file. * The notice for chan!e of
name of a re!istered laor or!anization shall e filed &ith
the B#rea# or the Re!ional Office &here the concerned
laor or!anizationPs certificate of re!istration or certificate
of creation of a chartered local &as iss#ed.
Section I. Re(#irements for notice of chan!e of name. *
The notice for chan!e of name of a laor or!anization
,a6 proof of approval or ratification of chan!e of name$ and
,6 the amended constit#tion and y*la&s.
0-.0 Effect of +han!e of Name
The chan!e of name of a laor or!anization shall not
affect its le!al personality. All ri!hts and oli!ations
of a laor or!anization #nder its old name shall
contin#e to e e)ercised y the laor or!anization
#nder its ne& name.
77777777
I- D C L A T O N
LABOR RELATIONS
Art. 3-5. +ancellation of Re!istration. * The
certificate of re!istration of any le!itimate laor
or!anization" &hether national or local" may e
cancelled y the B#rea#" after d#e hearin!" only on
the !ro#nds specified in Article 3-4 hereof. ,As
amended y Rep#lic Act No. 4I50" 2ay 31" 3??/6
77777777
Art. 3-5*A. Effect of a Cetition for +ancellation of
Re!istration. * A petition for cancellation of #nion
re!istration shall not s#spend the proceedin!s for
certification election nor shall it prevent the filin! of a
petition for certification election.
In case of cancellation" nothin! herein shall restrict
the ri!ht of the #nion to see' %#st and e(#itale
remedies in the appropriate co#rts. ,As amended y
Rep#lic Act No. 4I50" 2ay 31" 3??/6
77777777
Art. 3-4. >ro#nds for +ancellation of Hnion
Re!istration. * The follo&in! may constit#te !ro#nds
for cancellation of #nion re!istration:
,a6 2isrepresentation" false statement or fra#d in
connection &ith the adoption or ratification of the
constit#tion and y*la&s or amendments thereto" the
min#tes of ratification" and the list of memers &ho
too' part in the ratification$
,6 2isrepresentation" false statements or fra#d in
connection &ith the election of officers" min#tes of
the election of officers" and the list of voters$
,c6 Aol#ntary dissol#tion y the memers. ,As
amended y Rep#lic Act No. 4I50" 2ay 31" 3??/6
77777777
Art. 3-4*A. Aol#ntary +ancellation of Re!istration. *
The re!istration of a le!itimate laor or!anization
may e cancelled y the or!anization itself.
Crovided" That at least t&o*thirds of its !eneral
memership votes" in a meetin! d#ly called for that
p#rpose to dissolve the or!anization: Crovided"
f#rther" That an application to cancel re!istration is
thereafter s#mitted y the oard of the
or!anization" attested to y the president thereof.
,As amended y Rep#lic Act No. 4I50" 2ay 31"
3??/6
77777777
1. CANCELLATION OF RE%ISTRATION;
%RO/NDS
;hile re!istration is the act that converts a laor
or!anization to a le!itimate laor or!anization"
cancellation is the !overnment act that LdivestsM it of
that stat#s. It therey reverts to its character prior to
the re!istration. Altho#!h it does not cease to e)ist
or ecome an #nla&f#l or!anization" its %#ridical
personality as &ell as its stat#tory ri!hts and
privile!es LareM s#spended. It loses entitlement to the
ri!hts en#merated in Article 3I3 of the Laor +ode.
It cannot demand reco!nition y or ar!ainin! &ith
the employer" cannot file a petition for certification
election" and cannot stri'e.
0.0 8+ao9
F+aoF refers to a person or !ro#p or persons or to a
laor !ro#p &hich" in the !#ise of a laor
or!anization" s#pplies &or'ers to an employer" &ith
or &itho#t any monetary or other consideration
&hether in the capacity of an a!ent of the employer
or as an ostensile independent contractor.
0.3 Administrative +ancellation$ the 8reportorial
re(#irements9
Section 0. Reportin! re(#irements. * It shall e the d#ty of
every le!itimate laor #nions and &or'ers associations to
s#mit to the Re!ional Office or the B#rea# &hich iss#ed
its certificate of re!istration or certificate of creation of
chartered local" as the case may e" t&o ,36 copies of
each of the follo&in! doc#ments:
,a6 any amendment to its constit#tion and y*la&s and the
min#tes of adoption or ratification of s#ch amendments"
&ithin thirty ,-?6 days from its adoption or ratification$
,6 ann#al financial reports &ithin thirty ,-?6 days after the
close of each fiscal year or calendar year$
,c6 #pdated list of ne&ly*elected officers" to!ether &ith the
appointive officers or a!ents &ho are entr#sted &ith the
handlin! of f#nds" &ithin thirty ,-?6 days after each re!#lar
or special election of officers" or from the occ#rrence of
any chan!e in the officers of a!ents of the laor
or!anization or &or'ers association$
,d6 #pdated list of individ#al memers of chartered locals"
independent #nions and &or'ersP associations &ithin thirty
,-?6 days after the close of each fiscal year$ and
,e6 #pdated list of its chartered locals and affiliates or
memer or!anizations" collective ar!ainin! a!reements
e)ec#ted and their effectivity period" in the case of
federations or national #nions" &ithin thirty ,-?6 days after
the close of each fiscal year" as &ell as the #pdated list of
their a#thorized representatives" a!ents or si!natories in
the different re!ions of the co#ntry.
As #nderstood in these R#les" the fiscal year of a laor
or!anization shall coincide &ith the calendar year" #nless
a different period is prescried in the constit#tion and y*
la&s.
Eail#re of the laor or!anization to s#mit the
reports mentioned aove for five ,16 consec#tive
years a#thorizes the B#rea# to instit#te cancellation
proceedin!s #pon its o&n initiative or #pon
complaint y any party*in*interest.
II D C L A T O N
LABOR RELATIONS
2. #(O FILES PETITION FOR CANCELLATION
Section 3. ;ho may file. * Any party*in*interest may
commence a petition for cancellation of re!istration"
e)cept in actions involvin! violations of Article 3I0" &hich
can only e commenced y memers of the laor
or!anization concerned.
Section -. >ro#nds for cancellation. * The follo&in! shall
constit#te !ro#nds for cancellation of re!istration of laor
or!anizations:
,!6 commission of any of the acts en#merated #nder
Article 3I0 of the Laor +ode$ provided that no petition for
cancellation ased on this !ro#nd may e !ranted #nless
s#pported y at least thirty ,-?U6 percent of all the
memers of the respondent laor or!anization$
The petition shall e #nder oath and shall state
clearly and concisely the facts and !ro#nds relied
#pon" accompanied y proof of service to the
respondent. B#t s#ch petition cannot e entertained
in the petition for certification election filed y the
#nion.
'. #(ERE TO FILE PETITION
Section 0. ;here to file. * S#%ect to the re(#irements of
notice and d#e process" the re!istration of any le!itimate
independent laor #nion" chartered local and &or'ersP
association may e cancelled y the Re!ional =irector" or
in the case of federations" national or ind#stry #nions and
trade #nion centers" y the B#rea# =irector" #pon the filin!
of an independent complaint or petition for cancellation.
+ancellation orders iss#ed y the Re!ional =irector
are appealale to the BLR. The latter:s decision is
final and e)ec#tor" hence" not appealale to the
=OLE Secretary #t it may e elevated to the +o#rt
of Appeals y cer"iorari.
BLR decisions on cancellation cases that ori!inated
at the BLR itself may e appealed to the Secretary
and" a!ain" y cer"iorari to the +A.
). PROCED/RE
Section 3. Croced#re. * The Laor Relations =ivision of
the Re!ional Office shall ma'e a report of the laor
or!anizationPs non*compliance and s#mit the same to the
B#rea# for verification &ith its records. The B#rea# shall
send y re!istered mail &ith ret#rn card to the laor
or!anization concerned" a notice for compliance indicatin!
the doc#ments it failed to s#mit and the correspondin!
period in &hich they &ere re(#ired" &ith notice to comply
&ith the said reportorial re(#irements and to s#mit proof
thereof to the B#rea# &ithin ten ,0?6 days from receipt
thereof.
;here no response is received y the B#rea# &ithin thirty
,-?6 days from the release of the first notice" another
notice for compliance shall e made y the B#rea#" &ith
&arnin! that fail#re on its part to comply &ith the
reportorial re(#irements &ithin the time specified shall
ca#se the contin#ation of the proceedin!s for the
administrative cancellation of its re!istration.
Section -. C#lication of notice of cancellation of
re!istration . * ;here no response is a!ain received y the
B#rea# &ithin thirty ,-?6 days from release of the second
notice" the B#rea# shall ca#se the p#lication of the notice
of cancellation of re!istration of the laor or!anization in
t&o ,36 ne&spapers of !eneral circ#lation. The B#rea#
may cond#ct an investi!ation &ithin the employerPs
premises and at the laor or!anizationPs last 'no&n
address to verify the latterPs e)istence.
77777777
Art. 3I?. E(#ity of the inc#ment. All e)istin!
federations and national #nions &hich meet the
(#alifications of a le!itimate laor or!anization and
none of the !ro#nds for cancellation shall contin#e to
maintain their e)istin! affiliates re!ardless of the
nat#re of the ind#stry and the location of the
affiliates.
77777777
Chapter II
RI%(TS AND CONDITIONS OF -E-BERS(IP
Art. 3I0. Ri!hts and conditions of memership in a
laor or!anization. The follo&in! are the ri!hts and
conditions of memership in a laor or!anization:
a. No aritrary or e)cessive initiation fees shall e
re(#ired of the memers of a le!itimate laor
or!anization nor shall aritrary" e)cessive or
oppressive fine and forfeit#re e imposed$

. The memers shall e entitled to f#ll and detailed
reports from their officers and representatives of all
financial transactions as provided for in the
constit#tion and y*la&s of the or!anization$

c. The memers shall directly elect their officers"
incl#din! those of the national #nion or federation" to
&hich they or their #nion is affiliated" y secret allot
at intervals of five ,16 years. No (#alification
re(#irements for candidacy to any position shall e
imposed other than memership in !ood standin! in
s#%ect laor or!anization. The secretary or any
other responsile #nion officer shall f#rnish the
Secretary of Laor and Employment &ith a list of the
ne&ly*elected officers" to!ether &ith the appointive
officers or a!ents &ho are entr#sted &ith the
handlin! of f#nds" &ithin thirty ,-?6 calendar days
after the election of officers or from the occ#rrence
of any chan!e in the list of officers of the laor
or!anization$ ,As amended y Section 0." Rep#lic
Act No. ./01" 2arch 30" 04546

d. The memers shall determine y secret allot"
after d#e delieration" any (#estion of ma%or policy
I1 D C L A T O N
LABOR RELATIONS
affectin! the entire memership of the or!anization"
#nless the nat#re of the or!anization or force
ma%e#re renders s#ch secret allot impractical" in
&hich case" the oard of directors of the
or!anization may ma'e the decision in ehalf of the
!eneral memership$

e. No laor or!anization shall 'no&in!ly admit as
memers or contin#e in memership any individ#al
&ho elon!s to a s#versive or!anization or &ho is
en!a!ed directly or indirectly in any s#versive
activity$

f. No person &ho has een convicted of a crime
involvin! moral t#rpit#de shall e eli!ile for election
as a #nion officer or for appointment to any position
in the #nion$

!. No officer" a!ent or memer of a laor
or!anization shall collect any fees" d#es" or other
contri#tions in its ehalf or ma'e any dis#rsement
of its money or f#nds #nless he is d#ly a#thorized
p#rs#ant to its constit#tion and y*la&s$

h. Every payment of fees" d#es or other
contri#tions y a memer shall e evidenced y a
receipt si!ned y the officer or a!ent ma'in! the
collection and entered into the record of the
or!anization to e 'ept and maintained for the
p#rpose$

i. The f#nds of the or!anization shall not e applied
for any p#rpose or o%ect other than those e)pressly
provided y its constit#tion and y*la&s or those
e)pressly a#thorized y &ritten resol#tion adopted
y the ma%ority of the memers at a !eneral meetin!
d#ly called for the p#rpose$

%. Every income or reven#e of the or!anization shall
e evidenced y a record sho&in! its so#rce" and
every e)pendit#re of its f#nds shall e evidenced y
a receipt from the person to &hom the payment is
made" &hich shall state the date" place and p#rpose
of s#ch payment. S#ch record or receipt shall form
part of the financial records of the or!anization.

Any action involvin! the f#nds of the or!anization
shall prescrie after three ,-6 years from the date of
s#mission of the ann#al financial report to the
=epartment of Laor and Employment or from the
date the same sho#ld have een s#mitted as
re(#ired y la&" &hichever comes earlier: Crovided"
That this provision shall apply only to a le!itimate
laor or!anization &hich has s#mitted the financial
report re(#irements #nder this +ode: Crovided"
f#rther" that fail#re of any laor or!anization to
comply &ith the periodic financial reports re(#ired y
la& and s#ch r#les and re!#lations prom#l!ated
there#nder si) ,.6 months after the effectivity of this
Act shall a#tomatically res#lt in the cancellation of
#nion re!istration of s#ch laor or!anization$ ,As
amended y Section 0." Rep#lic Act No. ./01"
2arch 30" 04546

'. The officers of any laor or!anization shall not e
paid any compensation other than the salaries and
e)penses d#e to their positions as specifically
provided for in its constit#tion and y*la&s" or in a
&ritten resol#tion d#ly a#thorized y a ma%ority of all
the memers at a !eneral memership meetin! d#ly
called for the p#rpose. The min#tes of the meetin!
and the list of participants and allots cast shall e
s#%ect to inspection y the Secretary of Laor or his
d#ly a#thorized representatives. Any irre!#larities in
the approval of the resol#tions shall e a !ro#nd for
impeachment or e)p#lsion from the or!anization$

l. The treas#rer of any laor or!anization and every
officer thereof &ho is responsile for the acco#nt of
s#ch or!anization or for the collection" mana!ement"
dis#rsement" c#stody or control of the f#nds"
moneys and other properties of the or!anization"
shall render to the or!anization and to its memers a
tr#e and correct acco#nt of all moneys received and
paid y him since he ass#med office or since the last
day on &hich he rendered s#ch acco#nt" and of all
onds" sec#rities and other properties of the
or!anization entr#sted to his c#stody or #nder his
control. The renderin! of s#ch acco#nt shall e
made:

0. At least once a year &ithin thirty ,-?6 days after
the close of its fiscal year$

3. At s#ch other times as may e re(#ired y a
resol#tion of the ma%ority of the memers of the
or!anization$ and

-. Hpon vacatin! his office.

The acco#nt shall e d#ly a#dited and verified y
affidavit and a copy thereof shall e f#rnished the
Secretary of Laor.

m. The oo's of acco#nts and other records of the
financial activities of any laor or!anization shall e
open to inspection y any officer or memer thereof
d#rin! office ho#rs$

n. No special assessment or other e)traordinary fees
may e levied #pon the memers of a laor
or!anization #nless a#thorized y a &ritten
resol#tion of a ma%ority of all the memers in a
!eneral memership meetin! d#ly called for the
p#rpose. The secretary of the or!anization shall
record the min#tes of the meetin! incl#din! the list of
all memers present" the votes cast" the p#rpose of
the special assessment or fees and the recipient of
I. D C L A T O N
LABOR RELATIONS
s#ch assessment or fees. The record shall e
attested to y the president.

o. Other than for mandatory activities #nder the
+ode" no special assessments" attorney:s fees"
ne!otiation fees or any other e)traordinary fees may
e chec'ed off from any amo#nt d#e to an employee
&itho#t an individ#al &ritten a#thorization d#ly
si!ned y the employee. The a#thorization sho#ld
specifically state the amo#nt" p#rpose and
eneficiary of the ded#ction$ and

p. It shall e the d#ty of any laor or!anization and
its officers to inform its memers on the provisions of
its constit#tion and y*la&s" collective ar!ainin!
a!reement" the prevailin! laor relations system and
all their ri!hts and oli!ations #nder e)istin! laor
la&s.
Eor this p#rpose" re!istered laor or!anizations may
assess reasonale d#es to finance laor relations
seminars and other laor ed#cation activities.
Any violation of the aove ri!hts and conditions of
memership shall e a !ro#nd for cancellation of
#nion re!istration or e)p#lsion of officers from office"
&hichever is appropriate. At least thirty percent
,-?U6 of the memers of a #nion or any memer or
memers specially concerned may report s#ch
violation to the B#rea#. The B#rea# shall have the
po&er to hear and decide any reported violation to
mete the appropriate penalty.
+riminal and civil liailities arisin! from violations of
aove ri!hts and conditions of memership shall
contin#e to e #nder the %#risdiction of ordinary
co#rts.
77777777
1. DE-OCRATI&ATION OF /NIONS
As #nionism:s aim is to install ind#strial democracy"
the #nions themselves m#st e democratic. This is a
rationale ehind Article 3I0.
To democratize the #nions" Article 3I0 re(#ires that
the #nion officers e elected directly y the memers
thro#!h secret allot and that the ma%or policy
decisions" as a r#le" e made y the #nion
memers" a!ain" y secret allot. As in a rep#lic
&here soverei!nty resides in the people" the
memers of the #nion are the 'eepers and
dispensers of a#thority. The !overnin! po&er is the
memers" not the officers.
2. NAT/RE OF RELATIONS(IP BET#EEN /NION
AND ITS -E-EBERS
The #nion has een evolved as an or!anization of
collective stren!th for the protection of laor a!ainst
the #n%#st e)actions of capital" #t e(#ally important
is the re(#irement of fair dealin! et&een the #nion
and its memers" &hich is fid#ciary in nat#re" and
arises o#t of t&o factors: Fone is the de!ree of
dependence of the individ#al employee on the #nion
or!anization$ the other" a corollary of the first" is the
comprehensive po&er vested in the #nion &ith
respect to the individ#al.F The #nion may e
considered #t the a!ent of its memers for the
p#rpose of sec#rin! for them fair and %#st &a!es and
!ood &or'in! conditions and is s#%ect to the
oli!ation of !ivin! the memers as its principals all
information relevant to #nion and laor matters
entr#sted to it.
3.0 =#ty of +o#rt to Crotect Laorers from Hn%#st
E)ploitation y Oppressive Employers and Hnion
Leaders
@#st as this +o#rt has stric'en do&n #n%#st
e)ploitation of laorers y oppressive employers" so
&ill it stri'e do&n their #nfair treatment y their o&n
#n&orthy leaders. The +onstit#tion en%oins the State
to afford protection to laor. Eair dealin! is e(#ally
demanded of #nions as &ell as of employers in their
dealin!s &ith employees.
The #nion constit#tion is a covenant et&een the
#nion and its memers and amon! the memers.
'. RI%(TS OF /NION -E-BERS
The ri!hts and conditions of memership laid do&n
in Art. 3I0 may e s#mmarized as follo&s:
,06 Colitical ri!ht K the memer:s ri!ht to vote and e
voted for" s#%ect to la&f#l provisions on
(#alifications and dis(#alifications.
,36 =elierative and decision*ma'in! ri!ht K the
memer:s ri!ht to participate in delierations on
ma%or policy (#estions and decide them y secret
allot.
,-6 Ri!hts over money matters K the memer:s ri!ht
a!ainst e)cessive fees$ the ri!ht a!ainst
#na#thorized collection of contri#tions or
#na#thorized dis#rsements$ the ri!ht to re(#ire
ade(#ate records of income and e)penses and the
ri!ht of access to financial records$ the ri!ht to vote
on officers: compensation$ the ri!ht to vote on
proposed special assessments and e ded#cted a
special assessment only &ith the memer:s &ritten
a#thorization.
,I6 Ri!ht to Information K the memer:s ri!ht to e
informed ao#t the or!anization:s constit#tion and
I/ D C L A T O N
LABOR RELATIONS
y*la&s and the collective ar!ainin! a!reement and
ao#t laor la&s.
Altho#!h not so denominated" Article 3I0 of the
Laor +ode carries the character of a ill of ri!hts of
#nion memers.
-.0 Eli!iility for 2emership
;hen" ho&" and #nder &hat conditions does an
employee ecome a #nion memerR The ans&er
depends on the #nion:s constit#tion and y*la&s
inasm#ch as Article 3I4 !ives a laor or!anization
the ri!ht to prescrie its o&n r#les for ac(#isition or
retention of memership. Nonetheless" #nder Art.
3// an employee is already (#alified for #nion
memership startin! on his first day of service.
B#alifyin! for #nion memership does not
necessarily mean incl#sion in the covera!e of the
+BA. The reverse is e(#ally tr#e: memership in the
+BH does not a#tomatically mean memership in
the #nion.
To s#m #p:
Incl#sion in the +BH depends on the determination
of its appropriateness #nder Art. 3-I and Art. 311.
Incl#sion or memership in a #nion depends on the
#nion:s constit#tion and y*la&s" &itho#t pre%#dice to
Art. 3//,c6.
Incl#sion or covera!e in the +BA depends on the
stip#lations in the +BA itself.
). ELECTION OF /NION OFFICERS
The officers of the #nion are elected y the memers
in secret allot votin!. The election ta'es place at
intervals of five years &hich is the term of office of
the #nion officers incl#din! those of a national #nion"
federation" or trade #nion center.
The Implementin! R#les ,R#le SII" Section 06
re(#ire the inc#ment president to create an election
committee &ithin .? days efore e)piration of the
inc#ment officers: term.
If the officers &ith e)pired term do not call an
election" the remedy" accordin! to R#le SII" is for at
least -?U of the memers to file a petition &ith the
=OLE Re!ional Office.
The memer:s fr#stration over the performance of
the #nion officers" as &ell as their fear of a
8fra#d#lent9 election to e held #nder the latter:s
s#pervision" does not %#stify disre!ard of the #nion:s
constit#tion and y*la&s.
I.0 Eli!iility of Aoters
Only memers of the #nion can ta'e part in the
election of #nion officers.
Emer in !ood standin! is any person &ho has
f#lfilled the re(#irements for memership in the
#nion and &ho has neither vol#ntarily &ithdra&n
from memership nor een e)pelled or s#spended
from memership after appropriate proceedin!s
consistent &ith the la&f#l provisions of the #nion:s
constit#tion and y*la&s.
A laor or!anization may prescrie reasonale r#les
and re!#lations &ith respect to votin! eli!iility.
A laor or!anization may condition the e)ercise of
the ri!ht to vote on the payment of d#es" since
payin! d#es is a asic oli!ation of memership.
No&ever" this r#le is s#%ect to t&o (#alifications in
that ,a6 any r#le denyin! d#es*delin(#ent memers
the ri!ht to vote m#st e applied #niformly$ and ,6
memers m#st e afforded a reasonale opport#nity
to pay d#es" incl#din! a !race period d#rin! &hich
d#es may e paid &itho#t any loss of ri!hts.
S#mission of the employees names &ith the BLR
as (#alified memers of the #nion is not a condition
sine (#a non to enale said memers to vote in the
election of #nionPs officers.
I.3 Hnion Officers 2#st Be an Employee
,f6 No person &ho is not an employee or &or'er of the
company or estalishment &here an independently
re!istered #nion" affiliate" local or chapter of a laor
federation or national #nion operates shall henceforth e
elected or appointed as an officer of s#ch #nion" affiliate"
local or chapter.
In short" one sho#ld e employed in the company to
(#alify as officer of a #nion in that company.
I.- =is(#alification of Hnion Officers
F2oral t#rpit#deF has een defines as an act of
aseness" vileness" or depravity in the private and
social d#ties &hich a man o&es his fello& men" or to
society in !eneral" contrary to the accepted and
c#stomary r#le of ri!ht and d#ty et&een man and
man or cond#ct contrary to %#stice" honesty"
modesty" or !ood morals.
I.I Hnion Election Crotest: Croclamation of ;inners
Section 0-. Crotest$ &hen perfected. * Any party*in*interest
may file a protest ased on the cond#ct or mechanics of
the election. S#ch protests shall e recorded in the
I5 D C L A T O N
LABOR RELATIONS
min#tes of the election proceedin!s. Crotests not so raised
are deemed &aived.
The protestin! party m#st formalize its protest &ith the
2ed*Ariter" &ith specific !ro#nds" ar!#ments and
evidence" &ithin five ,16 days after the close of the election
proceedin!s. If not recorded in the min#tes and formalized
&ithin the prescried period" the protest shall e deemed
dropped.
0. ACTION A%AINST /NION OFFICERS
A #nion officer" after his election" may not e
e)pelled from the #nion for past malfeasance or
misfeasance. To do so &o#ld n#llify the choice made
y the #nion memers.
The remedy a!ainst errin! #nion officers is not
referend#m #t #nion e)p#lsion" i.e.. to e)pel them
from the Hnion.
It is the etter part of conventional or pra!matic
sol#tions in cases of this nat#re" asent overridin!
considerations to the contrary" to respect the &ill of
the ma%ority of the &or'ers &ho voted in the
elections. Altho#!h decreed #nder a different settin!"
it is apropos to recall the r#lin! that &here the
people have elected a man to office" it m#st e
ass#med that they did this &ith 'no&led!e of his life
and character" and that they disre!arded or for!ave
his fa#lts or miscond#ct" if he had een !#ilty of any.
5. D/E PROCESS IN I-PEAC(-ENT
+. E8P/LSION OF -E-BER
@#st as an officer is entitled to d#e process" so does
a memer. In a case" the +o#rt e)plicitly r#led that a
memer of a laor #nion may e e)pelled only for a
valid ca#se and y follo&in! the proced#re o#tlined
in the constit#tion and y*la&s of the #nion.
E)p#lsion of a memer for aritrary or impet#o#s
reason may amo#nt to #nfair laor practice y the
#nion.
*. RELIEF #IT(IN T(E /NION
>enerally" redress m#st first e so#!ht &ithin the
#nion itself in accordance &ith its constit#tion and
y*la&s.
If intra*#nion remedies have failed to correct any
violations of the internal laor or!anization
proced#res" a case can e filed &ith the B#rea# of
Laor Relations" &hich is a#thorized to hear and
decide cases of this nat#re.
5.0 E)ceptions
;here e)ha#stion of remedies &ithin the #nion itself
&o#ld practically amo#nt to a denial of %#stice" or
&o#ld e ill#sory or vain" it &ill not e insisted #pon"
partic#larly &here property ri!hts of the memers
are involved" as a condition to the ri!ht to invo'e the
aid of a co#rt.
6. CONSE2/ENCES OF VIOLATION OF RI%(TS
If the conditions of memership" or the ri!ht of the
memers" are violated" the violation may res#lt in the
cancellation of the #nion re!istration or the e)p#lsion
of the c#lpale officers.
Section I. Actions arisin! from Article 3I0. * Any complaint
or petition &ith alle!ations of mishandlin!"
misappropriation or non*acco#ntin! of f#nds in violation of
Article 3I0 shall e treated as an intra*#nion disp#te. It
shall e heard and resolved y the 2ed*Ariter p#rs#ant
to the provisions of R#le SI.
4.0 E)ception: ;hen -?U Not Re(#ired
;hen s#ch violation directly affects only one or t&o
memers" then only one or t&o memers &o#ld e
eno#!h to report s#ch violation.
It states that a report of a violation of ri!hts and
conditions of memership in a laor or!anization
may e made y F,a6t least thirty percent ,-?U6 of all
the memers of a #nion or any memer or memers
specially concerned.
17. VISITORIAL PO#ER
Article 3I/ a#thorizes the Secretary of Laor and
Employment or his d#ly a#thorized representative to
in(#ire into the financial activities of any laor
or!anization on the asis of a complaint #nder oath"
s#pported y 3? percent of the memership in order
to determine compliance or noncompliance &ith the
la&s and to aid in the prosec#tion of any violation
thereof.
11. C(ECK.OFF AND ASSESS-ENTS
A chec'*off is a method of ded#ctin! from an
employee:s pay at prescried period" the amo#nts
d#e the #nion for fees" fines" or assessments. The
ri!ht of a #nion to collect #nion d#es is reco!nized
#nder Article 3//,a6.
00.0 Assessments" li'e d#es" may also e chec'ed
off
=#es are defined as payments to meet the #nion:s
!eneral and c#rrent oli!ations. The payment m#st
e re!#lar" periodic" and #niform. Cayments #sed for
a special p#rpose" especially if re(#ired only for a
limited time" are re!arded as assessment.
I4 D C L A T O N
LABOR RELATIONS
ART. 3I0. Ri!hts and conditions of memership in a laor
or!anization. < The follo&in! are the ri!hts and
conditions of memership in a laor or!anization.
,o6 Other than for mandatory activities #nder the +ode" no
special assessment" attorneyPs fees" ne!otiation fees or
any other e)traordinary fees may e chec'ed off from any
amo#nt d#e an employee &itho#t an individ#al &ritten
a#thorization d#ly si!ned y an employee. The
a#thorization sho#ld specifically state the amo#nt" p#rpose
and eneficiary of the ded#ction.
AttorneyPs fees may not e ded#cted or chec'ed off
from any amo#nt d#e to an employee &itho#t his
&ritten consent e)cept for mandatory activities #nder
the +ode.
A mandatory activity has een defined as a %#dicial
process of settlin! disp#te laid do&n y the la&. An
amicale settlement entered into y the
mana!ement and the #nion is not a mandatory
activity #nder the +ode. 2oreover" the la& e)plicitly
re(#ires the individ#al &ritten a#thorization of each
employee concerned" to ma'e the ded#ction of
attorney:s fees valid.
=ed#ctions for #nion service fee are a#thorized y
la& and do not re(#ire individ#al chec'*off
a#thorizations.
Not&ithstandin! its Fcomp#lsoryF nat#re"
8comp#lsory aritration9 is not the Fmandatory
activityF #nder the +ode &hich dispenses &ith
individ#al &ritten a#thorizations for chec'*offs.
,06 Re(#irements K The fail#re of the Hnion to comply
strictly &ith the re(#irements set o#t y the la& invalidates
the (#estioned special assessment. S#stantial
compliance is not eno#!h in vie& of the fact that the
special assessment &ill diminish the compensation of the
#nion memers. Their e)press consent is re(#ired" and
this consent m#st e otained in accordance &ith the
steps o#tlined y la&" &hich m#st e follo&ed to the letter.
No shortc#ts are allo&ed.
It s#mitted only min#tes of the local memership
meetin!s &hen &hat is re(#ired is a &ritten resol#tion
adopted at the !eneral meetin!. ;orse still" the min#tes of
three of those local meetin!s held &ere recorded y a
#nion director and not y the #nion secretary. The min#tes
s#mitted to the +ompany contained no list of the
memers present and no record of the votes cast. Since it
is (#ite evident that the Hnion did not comply &ith the la&
at every t#rn" the only concl#sion that may e made
therefrom is that there &as no valid levy of the special
assessment p#rs#ant to para!raph ,n6 of Article 3I0 of the
Laor +ode.
,36 Effects of &ithdra&al of a#thorizations K Cara!raph ,o6
on the other hand re(#ires an individ#al &ritten
a#thorization d#ly si!ned y every employee in order that
a special assessment may e validly chec'ed*off. Even
ass#min! that the special assessment &as validly levied
p#rs#ant to para!raph ,n6" and !rantin! that individ#al
&ritten a#thorizations &ere otained y the Hnion"
nevertheless there can e no valid chec'*off considerin!
that the ma%ority of the #nion memers had already
&ithdra&n their individ#al a#thorizations. A &ithdra&al of
individ#al a#thorizations is e(#ivalent to no a#thorization
at all.
,-6 Eorms of disa#thorization K The Hnion points o#t"
ho&ever" that said disa#thorizations are not valid for ein!
collective in form" as they are Fmere #nches of randomly
proc#red si!nat#res" #nder loose sheets of paper.F The
contention deserves no merit for the simple reason that
the doc#ments containin! the disa#thorizations have the
si!nat#res of the #nion memers. The +o#rt finds these
retractions to e valid. There is nothin! in the la& &hich
re(#ires that the disa#thorization m#st e in individ#al
form.
,I6 C#rpose of the special assessment K Of the stated
p#rposes of the special assessment" as emodied in the
oard resol#tion of the Hnion" only the collection of a
special f#nd for laor and ed#cation research is
mandated" as correctly pointed o#t y the Hnion. The t&o
other p#rposes" namely" the p#rchase of vehicles and
other items for the enefit of the #nion officers and the
!eneral memership" and the payment of services
rendered y #nion officers" cons#ltants and others" sho#ld
e s#pported y the re!#lar #nion d#es" there ein! no
sho&in! that the latter are not s#fficient to cover the same.
,16 Article 333,6 of the Laor +ode" 8similar char!e9 K The
last stated p#rpose is contended y petitioners to fall
#nder the covera!e of Article 333 ,6 of the Laor +ode.
The contention is impressed &ith merit. Article 333 ,6
prohiits attorneyPs fees" ne!otiations fees and similar
char!es arisin! o#t of the concl#sion of a collective
ar!ainin! a!reement from ein! imposed on any
individ#al #nion memer. The collection of the special
assessment partly for the payment for services rendered
y #nion officers" cons#ltants and others may not e in the
cate!ory of FattorneyPs fees or ne!otiations fees.F B#t
there is no (#estion that it is an e)action &hich falls &ithin
the cate!ory of a Fsimilar char!e"F and" therefore" &ithin
the covera!e of the prohiition in the aforementioned
article.
,.6 Hnlimited discretion of #nion president" disallo&ed K
There is an additional proviso !ivin! the Hnion Cresident
#nlimited discretion to allocate the proceeds of the special
assessment. S#ch a proviso may open the door to a#se
y the officers of the Hnion considerin! that the total
amo#nt of the special assessment is (#ite considerale <
C0"?3/".4I.-- collected from those #nion memers &ho
ori!inally a#thorized the ded#ction" and C0"3./"5.-.-4
from those &ho did not a#thorize the same" or
s#se(#ently retracted their a#thorizations.
The +o#rt" therefore" sta'es do&n the (#estioned special
assessment for ein! a violation of Article 3I0" para!raphs
,n6 and ,o6" and Article 333 ,6 of the Laor +ode.
00.3 Three Re(#isites to +ollect Special Assessment
1? D C L A T O N
LABOR RELATIONS
Article 3I0 spea's of three ,-6 re(#isites that m#st
e complied &ith in order that the special
assessment for HnionPs incidental e)penses"
attorneyPs fees and representation e)penses" as
stip#lated in Article SII of the +BA" e valid and
#pheld namely: 06 a#thorization y a &ritten
resol#tion of the ma%ority of all the memers at the
!eneral memership meetin! d#ly called for the
p#rpose$ ,36 secretaryPs record of the min#tes of the
meetin!$ and ,-6 individ#al &ritten a#thorization for
chec'*off d#ly si!ned y the employee concerned.
00.- +hec'*off of A!ency Eee
This is the amo#nt" e(#ivalent to #nion d#es" &hich
a non*#nion memer pays to the #nion eca#se he
enefits from the +BA ne!otiated y the #nion. In
ne!otiatin! the +BA the #nion served as the
employee:s a!ent. +hec'*off of a!ency fee is
allo&ed #nder Art. 3I5,e6.
00.I Ille!al +hec'*off >ro#nd for cancellation
00.1 Employer:s Liaility in +hec'*off Arran!ement
+hec'*offs in tr#th impose an e)tra #rden on the
employer in the form of additional administrative and
oo''eepin! costs. It is a #rden ass#med y
mana!ement at the instance of the #nion and for its
enefit" in order to facilitate the collection of d#es
necessary for the latterPs life and s#stenance. B#t
the oli!ation to pay #nion d#es and a!ency fees
ovio#sly devolves not #pon the employer" #t the
individ#al employee. It is a personal oli!ation not
demandale from the employer #pon defa#lt or
ref#sal of the employee to consent to a chec'*off.
The only oli!ation of the employer #nder a chec'*
off is to effect the ded#ctions and remit the
collections to the #nion.
00.. @#risdiction Over +hec'*off =isp#tes
The Re!ional =irector of =OLE" not the laor ariter"
has %#risdiction over chec'*off disp#tes.
77777777
Chapter III
RI%(TS OF LE%ITI-ATE LABOR
OR%ANI&ATIONS
Art. 3I3. Ri!hts of le!itimate laor or!anizations. A
le!itimate laor or!anization shall have the ri!ht:
a. To act as the representative of its memers for the
p#rpose of collective ar!ainin!$

. To e certified as the e)cl#sive representative of
all the employees in an appropriate ar!ainin! #nit
for p#rposes of collective ar!ainin!$

c. To e f#rnished y the employer" #pon &ritten
re(#est" &ith its ann#al a#dited financial statements"
incl#din! the alance sheet and the profit and loss
statement" &ithin thirty ,-?6 calendar days from the
date of receipt of the re(#est" after the #nion has
een d#ly reco!nized y the employer or certified as
the sole and e)cl#sive ar!ainin! representative of
the employees in the ar!ainin! #nit" or &ithin si)ty
,.?6 calendar days efore the e)piration of the
e)istin! collective ar!ainin! a!reement" or d#rin!
the collective ar!ainin! ne!otiation$

d. To o&n property" real or personal" for the #se and
enefit of the laor or!anization and its memers$

e. To s#e and e s#ed in its re!istered name$ and

f. To #nderta'e all other activities desi!ned to enefit
the or!anization and its memers" incl#din!
cooperative" ho#sin!" &elfare and other pro%ects not
contrary to la&.
Not&ithstandin! any provision of a !eneral or special
la& to the contrary" the income and the properties of
le!itimate laor or!anizations" incl#din! !rants"
endo&ments" !ifts" donations and contri#tions they
may receive from fraternal and similar or!anizations"
local or forei!n" &hich are act#ally" directly and
e)cl#sively #sed for their la&f#l p#rposes" shall e
free from ta)es" d#ties and other assessments. The
e)emptions provided herein may e &ithdra&n only
y a special la& e)pressly repealin! this provision.
,As amended y Section 0/" Rep#lic Act No. ./01"
2arch 30" 04546
77777777
Art. 3I3*A. Reportorial Re(#irements. * The
follo&in! are doc#ments re(#ired to e s#mitted to
the B#rea# y the le!itimate laor or!anization
concerned:
,a6 Its constit#tion and y*la&s" or amendments
thereto" the min#tes of ratification" and the list of
memers &ho too' part in the ratification of the
constit#tion and y*la&s &ithin thirty ,-?6 days from
adoption or ratification of the constit#tion and y*lam
or amendments thereto$
,6 Its list of officers" min#tes of the election of
officers" and list of voters &ithin thirty ,-?6 days from
election$
,c6 Its ann#al financial report &ithin thirty ,-?6 days
after the close of every fiscal year$ and
,d6 Its list of memers at least once a year or
&henever re(#ired y the B#rea#.
10 D C L A T O N
LABOR RELATIONS
Eail#re to comply &ith the aove re(#irements shall
not e a !ro#nd for cancellation of #nion re!istration
#t shall s#%ect the errin! officers or memers to
s#spension" e)p#lsion from memership" or any
appropriate penalty. ,As amended y Rep#lic Act
No. 4I50" 2ay 31" 3??/6
77777777
1. NOT ANY L.L.O.
The first three ri!hts mentioned in this article do not
pertain to %#st ao#t any #nion #t only to the #nion
that has een selected as the ar!ainin!
representative of the employees in the ar!ainin!
#nit. This article m#st e read in relation to Article
311.
2. RI%(TS OF /NION TO REPRESENT ITS
-E-BERS
It is the f#nction of a laor #nion to represent its
memers a!ainst the employer:s #nfair laor
practices. It can file in their ehalf &itho#t the
c#mersome proced#re of %oinin! each and every
memer as a separate party.
A laor #nion has the re(#isite personality to s#e on
ehalf of its memers for their individ#al money
claims. It &o#ld e an #n&arranted impairment of
the ri!ht to self*or!anization if s#ch collective entities
&o#ld e arred from instit#tin! an action in their
representative capacity.
3.0 2emers =o#tin! Their Hnion
A laor #nion is one s#ch party a#thorized to
represent its memers #nder Article 3I3,a6 of the
Laor +ode &hich provides that a #nion may act as
the representative of its memers for the p#rpose of
collective ar!ainin!. This a#thority incl#des the
po&er to represent its memers for the p#rpose of
enforcin! the provisions of the +BA.
The intervention may e allo&ed &hen there is a
s#!!estion of fra#d or coll#sion or that the
representative &ill not act in !ood faith for the
protection of all interests represented y the #nion.
'. CO-PRO-ISE BINDIN% /PON -INORITY
-E-BERS OF /NION; E8CEPTION
It is an accepted r#le #nder o#r la&s that the &ill of the
ma%ority sho#ld prevail over the minority and that the
action ta'en y petitioners as minority memers of the
Hnion is contrary to the policy of the 2a!na +arta of
Laor" &hich promotes the settlement of differences
et&een mana!ement and laor y m#t#al a!reement"
and that if said action &ere tolerated" no employer &o#ld
ever enter into any compromise a!reement for the minority
memers of the Hnion &ill al&ays dishonor the terms of
the a!reement and demand for etter terms.
). CO-PRO-ISE OF -ONEY CLAI-S
2oney claims d#e to laorers cannot e the o%ect
of settlement or compromise effected y a #nion or
co#nsel &itho#t the specific individ#al consent of
each laorer concerned. The eneficiaries are the
individ#al complainants themselves. The #nion to
&hich they elon! can only assist them #t cannot
decide for them. A&ards in favor of laorers after
lon! years of liti!ation m#st e attended to &ith
m#t#al openness and in the est of faith. Only th#s
can &e really !ive meanin! to the constit#tional
mandate of !ivin! laorers ma)im#m protection and
sec#rity.
Hnder the philosophy of collective responsiility" an
employer &ho ar!ains in !ood faith sho#ld e entitled to
rely #pon the promises and a!reements of the #nion
representatives &ith &hom he m#st deal #nder the
comp#lsion of la& and contract. The collective ar!ainin!
process sho#ld e carried on et&een parties &ho can
m#t#ally respect and rely #pon the a#thority of each
other.F ;here" ho&ever" collective ar!ainin! process is
not involved" and &hat is at sta'e are ac' &a!es already
earned y the individ#al &or'ers y &ay of overtime"
premi#m and differential pay" and final %#d!ment has een
rendered in their favor" the present case" the real parties in
interest &ith direct material interest" as a!ainst the #nion
&hich has only served as a vehicle for collective action to
enforce their %#st claims" are the individ#al &or'ers
themselves. A#thority of the #nion to &aive or (#itclaim all
or part of the %#d!ment a&ard in favor of the individ#al
&or'ers cannot e li!htly pres#med #t m#st e e)pressly
!ranted" and the employer" as %#d!ment detor" m#st deal
in all !ood faith &ith the #nion as the a!ent of the
individ#al &or'ers. The +o#rt in t#rn sho#ld certainly verify
and ass#re itself of the fact and e)tent of the a#thority of
the #nion leadership to e)ec#te any compromise or
settlement of the %#d!ment on ehalf of the individ#al
&or'ers &ho are the real %#d!ment creditors.
0. RI%(T TO BE F/RNIS(ED #IT( FINANCIAL
STATE-ENT
To etter e(#ip the #nion in preparin! for or in
ne!otiatin! &ith the employer" the la& !ives it the
ri!ht to e f#rnished &ith the employer:s a#dited
financial statements. There are fo#r points in time
&hen the #nion may as' in &ritin! for these
statements:
,06 after the #nion has een reco!nized y the
employer as sole ar!ainin! representative of the
employees in the ar!ainin! #nit$ or
,36 after the #nion is certified y =OLE as s#ch sole
ar!ainin! representative$ or
,-6 &ithin the last .? days of the life of a +BA$ or
13 D C L A T O N
LABOR RELATIONS
,I6 d#rin! the collective ar!ainin! ne!otiation.
The a#dited statements" incl#din! the alance sheet
and the profit and loss statement" sho#ld e
provided y the employer &ithin -? calendar days
after receipt of the #nion:s re(#est.
5. RI%(T TO COLLECT D/ES
77777777
1- D C L A T O N
LABOR RELATIONS
Azucena, Cesario Alvero Jr. (2007). THE LABOR CODE WITH COMMENTS AND CASES (Vol. II). Quezon City: Rex Printing Company, Inc.
53 | P L A T O N
Title V
COVERAGE

Article 243. Coverage and employees right to self-
organization. All persons employed in commercial,
industrial and agricultural enterprises and in religious,
charitable, medical, or educational institutions, whether
operating for profit or not, shall have the right to self-
organization and to form, join, or assist labor
organizations of their own choosing for purposes of
collective bargaining. Ambulant, intermittent and
itinerant workers, self-employed people, rural workers
and those without any definite employers may form
labor organizations for their mutual aid and protection.
(As amended by Batas Pambansa Bilang 70, May 1,
1980).
________

1. ORGANIZING IN GENERAL

The rights to organize and to bargain, in a general sense,
are given not exclusively to employees. Even workers
who are not employees of any particular employer may
form their organizations to protect their interests.

Under Art. 243 of this Code, the right to organize refers
also to forming, joining or assisting a labor organization.
Connected to Art. 246 this right carries with it the right to
engage in group action, provided it is peaceful, to
support the organizations objective which is not
necessarily bargaining but, simply, to aid and protect its
members. But this kind of group action must be
differentiated from strike which, because it is work
stoppage, must observe certain regulation; otherwise,
the strike may be declared illegal and its leaders may be
thrown out of their jobs.

1.1 Coverage of the Right to Organize; Exceptions

The right to form, join or assist a labor organization is
granted to all kinds of employees of all kinds of
employerspublic or private, profit or non-profit,
commercial or religious. Their usual form of organization
is a union and the usual purpose is collective bargaining
with their employers.

But the seemingly all-inclusive coverage of all persons
in Article 243 actually admits exceptions. Under Art. 245,
for instance, managerial employees, regardless of the
kind of organization where they are employed, may not
join, assist or form any labor organization, meaning a
labor union.

Accordingly, managerial employees cannot, in the
absence of an agreement to the contrary, be allowed to
share in the concessions obtained by the labor union
through collective negotiation. Otherwise, they would be
exposed to the temptation of colluding with the union
during the negotiations to the detriment of the
employer. However, there is nothing to prevent the
employer from granting benefits to managerial
employees equal to or higher than those afforded to
union members.

Supervisors are allowed to organize, but they cannot for,
join or assist a rank-and-file union.

2. RIGHT TO ORGANIZE CANNOT BE BARGAINED AWAY

Although we have upheld the validity of the CBA as the
law among the parties, its provisions cannot override
what is expressly provided by law that only managerial
employees are ineligible to join, assist or form any labor
organization. Therefore, regardless of the challenged
employees' designations, whether they are employed as
Supervisors or in the confidential payrolls, if the nature
of their job does not fall under the definition of
"managerial" as defined in the Labor Code, they are
eligible to be members of the bargaining unit and to vote
in the certification election. Their right to self-
organization must be upheld in the absence of an express
provision of law to the contrary. It cannot be curtailed by
a collective bargaining agreement.

3. EMPLOYEES OF NONPROFIT INSTITUTIONS

Under Article 243 of the Labor Code, the rank-and-file
employees of non-profit medical institutions are
permitted to form, organize or join labor unions of their
choice for purposes of collective bargaining. If the union
has complied with the requisites provided by law for
calling a certification election, it is incumbent upon the
DOLE Regional Director to conduct such certification
election to ascertain the bargaining representative of the
hospital employees.

4. EXCEPTION: EMPLOYEE-MEMBERS OF A
COOPERATIVE

A cooperative is by its nature different from an ordinary
business concern being run either, by persons,
partnerships or corporations. Its owners and/or
members are the ones who run and operate the business
while the others are its employees. As above stated,
irrespective of the name of shares owned by its members
they are entitled to cast one vote each in deciding upon
the affair of the cooperative. Their share capital earn
limited interests. They enjoy special privileges as
exemption from income tax and sales taxes, preferential
right to supply their products to State agencies and even
exemption from minimum wage laws.

LABOR RELATIONS
54 | P L A T O N
An employee of such a cooperative who is a member and
co-owner thereof cannot invoke the right to collective
bargaining for certainly an owner cannot bargain with
himself or his co-owners.

However, in so far as it involves cooperatives with
employees who are not members or co-owners thereof,
certainly such employees are entitled to exercise the
rights of all workers to organization, collective
bargaining, negotiations and others as are enshrined in
the Constitution and existing laws of the country.

In another case, the court clarified that it is the fact of
ownership of the cooperative, and not involvement in
the management thereof, which disqualifies a member
from joining any labor organization within the
cooperative. Thus, irrespective of the degree of their
participation in the actual management of the
cooperative, all members thereof cannot form, assist or
join a labor organization for the purpose of collective
bargaining.

But member-employees of a cooperative may withdraw
as members of the cooperative in order to join a labor
union. Membership in a cooperative is voluntary;
inherent in it is the right not to join.

4.1 Exception to Exception: Association, not Union

While the members of a cooperative who are also its
employees cannot unionize for bargaining purposes, the
law does not prohibit them from forming an association
for their mutual aid and protection as employees.

D.O. No. 40-03 allows and defines a workers
association as one which is organized for the mutual aid
and protection of its members or for any legitimate
purpose other than collective bargaining.

5. EXCEPTION: INTERNATIONAL ORGANIZATIONS

A certification election cannot be conducted in an
international organization which the Philippine
Government has granted immunity from local
jurisdiction.

The grant of such immunity is a political question whose
resolution by the executive branch of government is
conclusive upon the courts

(1) International Organization and Specialized Agencies
The term "international organization" is generally used to
describe an organization set up by agreement between two or
more states. Under contemporary international law, such
organizations are endowed with some degree of international
legal personality such that they are capable of exercising
specific rights, duties and powers. They are organized mainly as
a means for conducting general international business in which
the member states have an interest. The United Nations, for
instance, is an international organization dedicated to the
propagation of world peace. "Specialized agencies" are
international organizations having functions in particular fields.
The term appears in Articles 57 and 63 of the Charter of the
United Nations.

(2) Principles Underlying the Grant of International Immunities
to International OrganizationsThere are basically three
propositions underlying the grant of international immunities
to international organizations. These principles, contained in
the ILO Memorandum are stated thus: 1) international
institutions should have a status which protects them against
control or interference by any one government in the
performance of functions for the effective discharge of which
they are responsible to democratically constituted international
bodies in which all the nations concerned are represented; 2)
no country should derive any national financial advantage by
levying fiscal charges on common international funds; and 3)
the international organization should, as a collectivity of States
members, be accorded the facilities for the conduct of its
official business customarily extended to each other by its
individual member States. The theory behind all three
propositions is said to be essentially institutional in character.
"It is not concerned with the status, dignity or privileges of
individuals, but with the elements of functional independence
necessary to free international institutions from national
control and to enable them to discharge their responsibilities
impartially on behalf of all their members. The raison d'etre for
these immunities is the assurance of unimpeded performance
of their functions by the agencies concerned.

(3) Labors Basic Rights RemainThe immunity of International
Catholic Migration Commission (ICMC) and the International
Rice Research Institution (IRRI) from local jurisdiction by no
means deprives labor of its basic rights, which are guaranteed
by Article II, Section 18, Article III, Section 8, and Article XIII,
Section 3, of the 1987 Constitution; and implemented by
Articles 243 and 246 of the Labor Code.

(4) Certification Election Barred by ImmunityThe immunity
granted being "from every form of legal process except in so far
as in any particular case they have expressly waived their
immunity," it is inaccurate to state that a certification election
is beyond the scope of that immunity for the reason that it is
not a suit against ICMC. A certification election cannot be
viewed as an independent or isolated process. It could trigger
off a series of events in the collective bargaining process
together with related incidents and/or concerted activities,
which could inevitably involve ICMC in the "legal process,"
which includes any penal, civil and administrative
proceedings. The eventuality of Court litigation is neither
remote and from which international organizations are
precisely shielded to safeguard them from the disruption of
their functions. Clauses on jurisdictional immunity are said to
be standard provisions in the constitutions of international
Organizations. The immunity covers the organization
concerned, its property and its assets...

5.1 Waiver of Immunity
LABOR RELATIONS
55 | P L A T O N

Waiver of its immunity is discretionary to IRRI. Without
such express waiver the NLRC or its labor arbiters have
no jurisdiction over IRRI even in cases of alleged illegal
dismissal of any of its employees.

5.2 Foreign Workers

Foreigners, whether natural or juridical, as well as foreign
corporations are strictly prohibited from engaging directly or
indirectly in all forms of trade union activities. However, aliens
working in the country with valid work permits may exercise
the right to self-organization if they are nationals of a country
that grants the same or similar rights to Filipino workers. (Art.
269)

6. EXCEPTION: RELIGIOUS OBJECTORS; IGLESIA NI
CRISTO MEMBERS

Under the Industrial Peace Act (1953) which preceded
the Labor Code (and even under the present Code) the
employer and the union could enter into a closed shop
agreement which would compel employees to become
union workers as a condition of continued employment.
But in 1961 R.A. No. 3350 was passed to exempt from
such compulsory union membership the followers of any
religious sect (such as the Iglesia ni Cristo) whose
teachings forbid membership in labor unions. The
constitutionality of R.A. No. 3350 was upheld by the
Supreme Court in Victoriano v. Elizalde.

It may not be amiss to point out here that the free
exercise of religious profession or belief is superior to
contract rights. In case of conflict, the latter must,
therefore, yield to the former.

6.1 Does the Exemption Still Stand?

6.2 Iglesia Ni Cristo Members May Form and Join Own
Union
________

Article 244. Right of employees in the public service.
Employees of government corporations established
under the Corporation Code shall have the right to
organize and to bargain collectively with their respective
employers. All other employees in the civil service shall
have the right to form associations for purposes not
contrary to law. (As amended by Executive Order No.
111, December 24, 1986).
________

1. GOVERNMENT EMPLOYEES RIGHT TO ORGANIZE;
LIMITATIONS

The highest law of the land guarantees to government
employees the right to organize and to negotiate, but not
the right to strike.

1.1 Limited Purpose

The extent of the government employees' right of self-
organization differs significantly from that of employees
in the private sector. The latter's right of self-
organization, i.e., "to form, join or assist labor
organizations for purposes of collective bargaining,"
admittedly includes the right to deal and negotiate with
their respective employers in order to fix the terms and
conditions of employment and also, to engage in
concerted activities for the attainment of their
objectives, such as strikes, picketing, boycotts. But the
right of government employees to "form, join or assist
employees organizations of their own choosing" under
Executive Order No. 180 is not regarded as existing or
available for "purposes of collective bargaining," but
simply "for the furtherance and protection of their
interests."

In other words, the right of Government employees to
deal and negotiate with their respective employers is not
quite as extensive as that of private employees. Excluded
from negotiation by government employees are the
"terms and conditions of employment...that are fixed by
law," it being only those terms and conditions not
otherwise fixed by law that "may be subject of
negotiation between the duly recognized employees'
organizations and appropriate government authorities."

Declared to be 'not negotiable' are matters "that require
appropriation of funds;" e.g., increase in salary emoluments
and other allowances, car plan, special hospitalization, medical
and dental services, increase in retirement benefits (Sec. 3, Rule
VIII), and those "that involve the exercise of management
prerogatives;" e.g., appointment, promotion,
assignment/detail, penalties as a result of disciplinary actions,
etc. (Sec. 4, Id.) Considered negotiable are such matters as
schedule of vacation and other leaves, work assignment of
pregnant women; recreational, social, athletic, and cultural
activities and facilities, etc. (Sec. 2, Id.).

1.2 No Signing Bonus

Employees and officers of SSS are not entitled to the
signing bonus provided for in the collective negotiation
agreement because the process of collective negotiations
in the public sector does not encompass terms and
conditions of employment requiring the appropriation of
public funds. The Court reminds the Social Security
Commission officials that the SSS fund is not their money

1.3 Excepted Employees

LABOR RELATIONS
56 | P L A T O N
Excepted from the application of Executive Order 180,
however, are members of the Armed Forces of the
Philippines, including police officers, policemen, firemen,
and jail guards (Sec. 4). For reasons of security and
safety, they are not allowed to unionize.

A high level employee is one whose functions are
normally considered policy determining, managerial or
one whose duties are highly confidential in nature. A
managerial function refers to the exercise of powers such
as: (1) to effectively recommend such managerial
actions; (2) to formulate or execute management policies
and decisions; or (3) to hire, transfer, lay-off, recall,
dismiss, assign or discipline employees.

1.3a Professors as rank-and-file employees

Professors at the University of the Philippines who are
not exercising managerial or highly confidential functions
are rank-and-file employees and may unionize separately
from the non-academic personnel.

In short, the professors, associate professors and
assistant professors of the University of the Philippines
are rank-and-file employees. The full professors,
associate professors, assistant professors, instructors and
the research, extension and professional staff may, if so
minded, organize themselves into a separate collective
bargaining unit.

1.4 Right to Strike

EO No. 180 also concedes to government employees, like their
counterparts in the private sector, the right to engage in
concerted activities, including the right to strike, the executive
order is quick to add that those activities must be exercised in
accordance with law, i.e. are subject both to "Civil Service Law
and rules" and "any legislation that may be enacted by
Congress," that "the resolution of complaints, grievances and
cases involving government employees" is not ordinarily left to
collective bargaining or other related concerted activities, but
to "Civil Service Law and labor laws and procedures whenever
applicable;" and that in case "any dispute remains unresolved
after exhausting all available remedies under existing laws and
procedures, the parties may jointly refer the dispute to the
(Public Sector Labor-Management) Council for appropriate
action." What is more, the Rules and Regulations implementing
Executive Order No. 180 explicitly provide that since the "terms
and conditions of employment in the government, including
any political subdivision or instrumentality thereof and
government-owned and controlled corporations with original
charters are governed by law, the employees therein shall not
strike for the purpose of securing changes thereof.

2. REGISTRATION

Sec. 7. Government employees' organizations shall register
with the Civil Service Commission and the Department of Labor
and Employment. The application shall be filed with the Bureau
of Labor Relations of the Department which shall process the
same in accordance with the provisions of the Labor Code of
the Philippines, as amended. Applications may also be filed
with the Regional Offices of the Department of Labor and
Employment which shall immediately transmit the said
applications to the Bureau of Labor Relations within three (3)
days from receipt thereof.

Sec. 8. Upon approval of the application, a registration
certificate be issued to the organization recognizing it as a
legitimate employees' organization with the right to represent
its members and undertake activities to further and defend its
interest. The corresponding certificates of registration shall be
jointly approved by the Chairman of the Civil Service
Commission and Secretary of Labor and Employment. (E.O. No.
180)

3. CERTIFICATION ELECTION IN GOVERNMENT
CORPORATION

A certification election to choose the union that will
represent the employees may be conducted by the
Bureau of Labor Relations in a government corporation,
whether governed by the Labor Code or the Civil Service
rules.

3.1 Election of Officers in Government Unions

It is quite clear from this provision that BLR has the
original and exclusive jurisdiction on all inter-union and
intra-union conflicts. An intra-union conflict would refer
to a conflict within or inside a labor union, and an inter-
union controversy or dispute, one occurring or carried on
between or among unions. The subject of the case at bar,
which is the election of the officers and members of the
board of KMKK-MWSS, is, clearly, an intra-union conflict,
being within or inside a labor union. It is well within the
powers of the BLR to act upon.

4. WHEN PSLMC MAY RULE ON LEGALITY OF DISMISSAL

The Public Sector Labor-Management Council, created by
Executive Order No. 180 (June 1, 1987) has jurisdiction to
hear charges of unfair labor practice filed by government
employees against their employer, e.g., the Pamantasan
ng Lungsod ng Maynila. In deciding the ULP charge the
PSLMC may also rule on the complainants dismissal if
the two issuesULP and dismissalare unavoidably
interlinked.

5. UNION-BUSTING IN A GOVERNMENT AGENCY, U.L.P.

5.1 Even Temporary Employees May Organize

LABOR RELATIONS
57 | P L A T O N
Even temporary employees enjoy the basic right to form
organization or association for purposes not contrary to
law.

Under Art. 277(c) of the Labor Code, any employee,
whether employed for a definite period of not, shall
beginning on his first day of service, be considered an
employee for purposes of membership in any labor
union.
________

Article 245. Ineligibility of managerial employees to join
any labor organization; Right of Supervisory Employees. -
Managerial employees are not eligible to join, assist or
form any labor organization. Supervisory employees shall
not be eligible for membership in the collective
bargaining unit of the rank-and-file employees but may
join, assist or form separate collective bargaining units
and/or legitimate labor organizations of their own. The
rank-and-file union and the supervisors union operating
within the same establishment may join the same
federation or national union. (As amended by Section 18,
Republic Act No. 6715, March 21, 1989 and Section 8,
Republic Act No. 9481 which lapsed into law on May 25,
2007 and became effective on June 14, 2007).
________

1. CATEGORIES OF EMPLOYEES

RA 6715 which took effect on March 21, 1989 (15 days
after its publication in the "Philippines Daily Inquirer")
provides that although "supervisory employees shall not
be eligible for membership in a labor organization of the
rank and file employees," they may, however, "join,
assist or form separate labor organization of their own."

2. INELIGIBILITY OF MANAGERS

2.1 Types of Managerial Employees

The term "manager" generally refers to "anyone who is
responsible for subordinates and other organizational
resources." As a class, managers constitute three levels of a
pyramid, namely, top management, middle management, and
first-line management which is also called supervisor. Below
this third level are the operatives or operating employees who,
we may add, are also called rank-and-file.

FIRST-LINE MANAGERS The lowest level in an organization at
which individuals are responsible for the work of others is
called first-line or first-level management. First-line managers
direct operating employees only; they do not supervise other
managers. Examples of first-line managers are the "foreman" or
production supervisor in a manufacturing plant, the technical
supervisor in a research department, and the clerical supervisor
in a large office. First-level managers are often called
supervisors.

MIDDLE MANAGERS The term middle management can refer
to more than one level in an organization. Middle managers
direct the activities of other managers and sometimes also
those of operating employees. Middle managers' principal
responsibilities are to direct the activities that implement their
organizations' policies and to balance the demands of their
superiors with the capacities of their subordinates. A plant
manager in an electronics firm is an example of a middle
manager.

TOP MANAGERS Composed of a comparatively small group
of executives, top management is responsible for the overall
management of the organization. It establishes operating
policies and guides the organization's interactions with its
environment. Typical titles of top managers are "chief executive
officer," "president," and "senior vice-president." Actual titles
vary from one organization to another and are not always a
reliable guide to membership in the highest management
classification.

As can be seen from this description, a distinction exists
between those who have the authority to devise, implement
and control strategic and operational policies (top and middle
managers) and those whose task is simply to ensure that such
policies are carried out by the rank-and-file employees of an
organization (first-level managers/supervisors). What
distinguishes them from the rank-and-file employees is that
they act in the interest of the employer in supervising such
rank-and-file employees.

"Managerial employees" may therefore be said to fall into two
distinct categories: the "managers" per se, who compose the
former group described above, and the "supervisors" who form
the latter group. Whether they belong to the first or the second
category, managers, vis-a-vis employers, are, likewise,
employees.

2.2 Constitutionality of the Prohibition

The question is whether the first sentence of Art. 245 of
the Labor Code, prohibiting managerial employees from
forming, assisting or joining any labor organization, is
constitutional in light of Art. III, Sec. 8 of the Constitution
which provides:

The right of the people, including those employed in the public
and private sectors, to form unions, association, or societies for
purposes not contrary to law shall not be abridged.

The present Article 245 is the result of the amendment of
the Labor Code in 1989 by R.A. No. 6715, otherwise
known as the Herrera-Veloso Law. Unlike the Industrial
Peace Act or the provisions of the Labor Code which it
superseded, R.A. No. 6715 provides separate definitions
of the terms "managerial" and "supervisory employees"
(See Art. 212[m]).

Although the definition of "supervisory employees"
seems to have been unduly restricted to the last phrase
LABOR RELATIONS
58 | P L A T O N
of the definition in the Industrial Peace Act, the legal
significance given to the phrase "effectively
recommends" remains the same. In fact, the distinction
between top and middle managers, who set
management policy, and front-line supervisors, who are
merely responsible for ensuring that such policies are
carried out by the rank and file, is articulated in the
present definition.

The rationale for this inhibition has been stated to be, because
if these managerial employees would belong to or be affiliated
with a Union, the latter might not be assured of their loyalty to
the Union in view of evident conflict of interests. The Union can
also become company-dominated with the presence of
managerial employees in Union membership.

2.2a Other Opinions

Justice Puno further airs a warning: To declare Article 245 of
the Labor Code unconstitutional cuts deep into our existing
industrial life and will open the floodgates to unionization at all
levels of the industrial hierarchy. Such a ruling will wreak havoc
on the existing set-up between management and labor. If all
managerial employees will be allowed to unionize, then all who
are in the payroll of the company, starting from the president,
vice-president, general managers and everyone, with the
exception of the directors, may go on strike or picket the
employer. Company officers will join forces with the
supervisors and rank-and-file.

3. EVOLUTION OF SUPERVISORS RIGHT TO ORGANIZE

Unlike managers, supervisors can unionize.

3.1 First Period: Under the Industrial Peace Act

The problem was that although the Industrial Peace Act
defined a supervisor, it failed to define a manager or
managerial employee. So the question arose: Did the
word supervisor include manager? Could managers
also unionize? In a case involving Caltex managers, the
Court answered affirmatively.

3.2 Second Period: Under the Labor Code Before
Amendment by R.A. No. 6715

This time the question was: Did managerial employee
include supervisor? Were supervisors also banned from
unionizing? Yes. The prohibition was applied to
supervisors in the case of Bulletin Publishing Corp. V.
Sanchez, 144 SCRA 428, decided on October 7, 1986.

3.3 Third Period: Under the Labor Code as Amended by
RA 6715

R.A. No. 6715 presents a compromise formula: retain the
ineligibility of managerial employees but revive the right
of supervisory employees to unionize.

4. DEFINITION OF MANAGER AND SUPERVISOR

Unlike in the Industrial Peace Act and the Labor Code
before such amendment, the power to decide on
managerial acts is now separated from the power to
recommend those managerial acts, such as laying down
policy, hiring or dismissing employees, etc. A supervisor
has the power only to recommend while a managerial
employee has the power to decide and do those acts.

But to make one a supervisor, the power to recommend
must not be merely routinary or clerical in nature but
requires the use of independent judgment. In other
words, the recommendation is (1) discretionary or
judgmental (not clerical), (2) independent (not a
dictation of someone else), and (3) effective (given
particular weight in making the management decision). If
these qualities are lacking or, worse, if the power to
recommend is absent, then the person is not really a
supervisor but a rank-and-file employee and therefore
belongs or should belong to a rank-and-file organization.

Similarly, a so-called manager, no matter how his
position is titled, is not really a manager in the eyes of
the law if he does not possess managerial powers (to lay
down and execute management policies and/ or to hire,
transfer, suspend, lay-off, recall, discharge, assign or
discipline employees). If he can only recommend the
exercise of any of these powers, he is only a supervisor,
hence, may join, assist or form a supervisors
organization.

5. TEST OF SUPERVISORY STATUS

The test of "supervisory" or "managerial status" depends on
whether a person possesses authority to act in the interest of
his employer in the matter specified in Article 212 (k) of the
Labor Code and Section 1 (m) of its Implementing Rules and
whether such authority is not merely routinary or clerical in
nature, but requires the use of independent judgment. Thus,
where such recommendatory powers as in the case at bar, are
subject to evaluation, review and final action by the
department heads and other higher executives of the company,
the same, although present, are not effective and not an
exercise of independent judgment as required by law.

It is the nature of an employee's functions and not the
nomenclature or title given to his job which determines
whether he has rank-and-file or managerial status. Among the
characteristics of managerial rank are: (1) He is not subject to
the rigid observance of regular office hours; (2) His work
requires the consistent exercise of discretion and judgment in
its performance; (3) the output produced or the result
accomplished cannot be standardized in relation to a given
LABOR RELATIONS
59 | P L A T O N
period of time; (4) He manages a customarily recognized
department or subdivision of the establishment, customarily
and regularly directing the work of other employees therein; (5)
He either has the authority to hire or discharge other
employees or his suggestions and recommendations as to
hiring and discharging, advancement and promotion or other
change of status of other employees are given particular
weight; and (6) As a rule, he is not paid hourly wages nor
subjected to maximum hours of work.

5.1 The Power to Recommend

The power to recommend, in order to qualify an
employee as a supervisor, must not only be effective but
should require the use of independent judgment. It
should not be merely of a routinary or clerical nature.

5.2 Examples of Ineffective or Clerical Recommendation

6. SEGREGATION OF RANK-AND-FILE AND SUPERVISORS

Article 245 allows supervisory employees to form, join, or
assist separate labor organizations of their own, but they
are not eligible for membership in a labor organization of
the rank-and-file employees. Neither may a rank-and-file
join a union of supervisors.

This policy of segregating the supervisors union from
that of the rank-and-file is founded on fairness to the
employees themselves. It will be doubly detrimental to
the employer if the supervisors and the rank-and-file, as
members of only one union, could take a common stand
against the employer.

6.1 Effects of Having Mixed Membership

A union whose membership is a mixture of supervisors
and rank-and-file is not and cannot become a legitimate
labor organization. It cannot petition for a certification
election, much less ask to be recognized as the
bargaining representative of employees.

The Labor Code has made it a clear statutory policy to prevent
supervisory employees from joining labor organizations
consisting of rank-and-file employees as the concerns which
involve members of either group are normally disparate and
contradictory.

Clearly, based on Article 245, a labor organization composed of
both rank-and-file and supervisory employees is no labor
organization at all. It cannot, for any guise or purpose, be a
legitimate labor organization. Not being one, an organization
which carries a mixture of rank-and-file and supervisory
employees cannot possess any of the rights of a legitimate
labor organization, including the right to file a petition for
certification election for the purpose of collective bargaining. It
becomes necessary, therefore, anterior to the granting of an
order allowing a certification election, to inquire into the
composition of any labor organization whenever the status of
the labor organization is challenged on the basis of Article 245
of the Labor Code.

The rationale behind the Code's exclusion of supervisors from
unions of rank-and-file employees is that such employees,
while in the performance of supervisory functions, become the
alter ego of management in the making and the implementing
of key decisions at the sub-managerial level. Certainly, it would
be difficult to find unity or mutuality of interests in a bargaining
unit consisting of a mixture of rank-and-file and supervisory
employees. And this is so because the fundamental test of a
bargaining unit's acceptability is whether or not such a unit will
best advance to all employees within the unit the proper
exercise of their collective bargaining rights. The Code itself has
recognized this, in preventing supervisory employees from
joining unions of rank-and-file employees.

6.2 How Many? How Few?

6.3 Illegal Mixed Membership Must Be Raised and
Proved

6.4 Cancellation of Union Registration on Ground of
Inclusion of Disqualified Positions: What needs to be
Proved

What is essential is the nature of the employees function and
not the nomenclature or title given to the job which determines
whether the employee has rank-and-file or managerial status or
whether he is a supervisory employee.

The implementing Rules state that the legal personality
of the petitioner union cannot be subject to collateral
attack but may be questioned only in an independent
petition for cancellation.

To summarize, the petition for certification election is
not the proper forum to raise the issue of legal
personality of the union. Also, a petition to cancel union
registration cannot be heard or decided by the Med-
Arbiter but either the DOLE Regional Director for
enterprise-level or the BLR Director for national unions.

6.5 Affiliation of Supervisors and Rank-and-File Unions

Even in affiliating with a federation, the unions of the
supervisors and of the ran-and-file should be segregated.

The peculiar role of supervisors is such that while they are not
managers, when they recommend action implementing
management policy or ask for the discipline or dismissal of
subordinates, they identify with the interests of the employer
and may act contrary to the interests of the rank-and-file.

We agree with the petitioner's contention that a conflict of
interest may arise in the areas of discipline, collective
bargaining and strikes. Members of the supervisory union
might refuse to carry out disciplinary measures against their co-
LABOR RELATIONS
60 | P L A T O N
member rank-and-file employees. In the area of bargaining,
their interests cannot be considered identical. The needs of one
are different from those of the other. Moreover, in the event of
a strike, the national federation might influence the
supervisors' union to conduct a sympathy strike on the sole
basis of affiliation.

Thus, if the intent of the law is to avoid a situation where
supervisors would merge with the rank and-file or where the
supervisors' labor organization would represent conflicting
interests, then a local supervisors' union should not be allowed
to affiliate with the national federation of union of rank-and-file
employees where that federation actively participates in union
activity in the company.

6.6 Restriction in Affiliation Clarified in De La Salle

First, the rank-and-file employees are directly under the
authority of the supervisory employees. Second, the
national federation is actively involved in union activities
in the company. If these two conditions are absent, the
rule prohibiting supervisors from affiliating with the
mother union of the rank-and-file union does not apply.

The affiliation of two local unions in a company with the same
national federation is not by itself a negate-on of their
independence since in relation to the employer, the local
unions are considered as the principals, while the federation is
deemed to be merely their agent.

7. CONFIDENTIAL EMPLOYEES

7.1 First Swing: Inclusion Among Rank-and-File

7.2 Second Swing: Exclusion from Rank-and-File

7.3 Third Swing: Inclusion Among Supervisors

7.4 Fourth Swing: Inclusion Among Monthly Paid Rank-
and-File

7.4a Limited Exclusion; Doctrine of Necessary Implication

A confidential employee is one entrusted with
confidence on delicate matters, or with the custody,
handling, or care and protection of the employer's
property. While Art. 245 of the Labor Code singles out
managerial employees as ineligible to join, assist or form
any labor organization, under the doctrine of necessary
implication, confidential employees are similarly
disqualified.

The doctrine of necessary implication means that what is
implied in a statute is as much a part thereof as that
which is expressed.

7.4b The Metrolab and Meralco Summations: Exclusion
from Bargaining unit and Closed-shop Clause

Although Article 245 of the Labor Code limits the ineligibility to
join, form and assist any labor organization to managerial
employees, jurisprudence has extended this prohibition to
confidential employees or those who by reason of their
positions or nature of work are required to assist or act in a
fiduciary manner to managerial employees and hence, are
likewise privy to sensitive and highly confidential records.

7.4c Who Are Confidential Employees?

Confidential employees assist and act in a confidential
capacity to, or have access to confidential matters of,
persons who exercise managerial functions in the field of
labor relations. As such, the rationale behind the
ineligibility of managerial employees to form, assist or
join a labor union equally applies to them.

Confidential employees are those who by reason of their
positions or nature of work are required to assist or act
in a fiduciary manner to managerial employees and
hence, are likewise privy to sensitive and highly
confidential records.

By the very nature of their functions, they assist and act
in a confidential capacity to, or have access to
confidential matters of, persons who exercise managerial
functions in the field of labor relations.

7.4d The Labor Nexus

The broad rationale behind this rule is that employees should
not be placed in a position involving a potential conflict of
interests. "Management should not be required to handle labor
relations matters through employees who are represented by
the union with which the company is required to deal and who
in the normal performance of their duties may obtain advance
information of the company's position with regard to contract
negotiations, the disposition of grievances, or other labor
relations matters."

Art. 245 of the Labor Code does not directly prohibit
confidential employees from engaging in union activities.
However, under the doctrine of necessary implication,
the disqualification of managerial employees equally
applies to confidential employees. The confidential-
employee rule justifies exclusion of confidential
employees because in the normal course of their duties
they become aware of management policies relating to
labor relations. It must be stressed, however, that when
the employee does not have access to confidential labor
relations information, there is no legal prohibition
against confidential employees from forming, assisting,
or joining a union.

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61 | P L A T O N
7.4e New CBA may include employees excluded from old
CBA; Expired CBA may be Modified, not just Renewed

The employer and the union in an enterprise may
negotiate and agree whom to cover in their CBA. And
they are free to change their agreement: people
excluded before may be included now, or vice versa.

8. SECURITY GUARDS MAY JOIN RANK-AND-FILE OR
SUPERVISORS UNION

Under the old rules, security guards were barred from
joining a labor organization of the rank-and-file. Under
RA 6715, they may now freely join a labor organization of
the rank-and-file or that of the supervisory union,
depending on their rank.
________

Article 245-A. Effect of inclusion as members of
employees outside the bargaining unit. - The inclusion as
union members of employees outside the bargaining unit
shall not be a ground for the cancellation of the
registration of the union. Said employees are
automatically deemed removed from the list of
membership of said union. (Introduced as new provision
by Section 9, Republic Act No. 9481 which lapsed into law
on May 25, 2007 and became effective on June 14,
2007).
________

Article 246. Non-abridgment of right to self-organization.
It shall be unlawful for any person to restrain, coerce,
discriminate against or unduly interfere with employees
and workers in their exercise of the right to self-
organization. Such right shall include the right to form,
join, or assist labor organizations for the purpose of
collective bargaining through representatives of their
own choosing and to engage in lawful concerted
activities for the same purpose or for their mutual aid
and protection, subject to the provisions of Article 264 of
this Code. (As amended by Batas Pambansa Bilang 70,
May 1, 1980).
________

1. CONCEPT OF THE RIGHT TO SELF ORGANIZATION

This is a key article that offers an inclusionary definition
of the right to self-organization (S.O.) by saying not what
it is but what it includes. It includes at least two rights:
(1) the right to form, join or assist labor organizations,
and (2) the right to engage in lawful concerted activities.
The labor organization may be a union or association of
employees, as mentioned in Article 212(g). Its purposes
may be collective bargaining (as stated in this Article) or
dealing with the employer [as stated in Article 212(g)].

The right to form labor organization is twin to the right to
engage in concerted activities.

It is worth noting, finally, that the right to self-
organization is granted not only to employees but to
workers, whether employed or not. In fact,
constitutionally speaking, the right to form associations
or societies is a right of the people, whether workers or
not.

No personinside or outside of government, employer
or non-employer, unionist or non-unionistmay abridge
these rights. If abridged in the workplace, the
abridgment is termed ULP (unfair labor practice).

Article 246, is both (in mixed metaphors), the conceptual
mother and the formidable fortress of the prohibition
expounded in the next three articles.
________

Title VI
UNFAIR LABOR PRACTICES

Chapter I
CONCEPT

Article 247. Concept of unfair labor practice and
procedure for prosecution thereof. Unfair labor
practices violate the constitutional right of workers and
employees to self-organization, are inimical to the
legitimate interests of both labor and management,
including their right to bargain collectively and otherwise
deal with each other in an atmosphere of freedom and
mutual respect, disrupt industrial peace and hinder the
promotion of healthy and stable labor-management
relations.

Consequently, unfair labor practices are not only
violations of the civil rights of both labor and
management but are also criminal offenses against the
State which shall be subject to prosecution and
punishment as herein provided.

Subject to the exercise by the President or by the
Secretary of Labor and Employment of the powers vested
in them by Articles 263 and 264 of this Code, the civil
aspects of all cases involving unfair labor practices, which
may include claims for actual, moral, exemplary and
other forms of damages, attorneys fees and other
affirmative relief, shall be under the jurisdiction of the
Labor Arbiters. The Labor Arbiters shall give utmost
priority to the hearing and resolution of all cases
involving unfair labor practices. They shall resolve such
cases within thirty (30) calendar days from the time they
are submitted for decision.

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62 | P L A T O N
Recovery of civil liability in the administrative
proceedings shall bar recovery under the Civil Code.

No criminal prosecution under this Title may be
instituted without a final judgment finding that an unfair
labor practice was committed, having been first obtained
in the preceding paragraph. During the pendency of such
administrative proceeding, the running of the period of
prescription of the criminal offense herein penalized shall
be considered interrupted: Provided, however, that the
final judgment in the administrative proceedings shall
not be binding in the criminal case nor be considered as
evidence of guilt but merely as proof of compliance of
the requirements therein set forth. (As amended by
Batas Pambansa Bilang 70, May 1, 1980 and later further
amended by Section 19, Republic Act No. 6715, March
21, 1989).
________

1. CONCEPT OF UNFAIR LABOR PRACTICE

As noted at the start of Book V a major aim of labor
relations policy is industrial democracy whose realization
is most felt in free collective bargaining or negotiation
over terms and conditions of employment. But for
bargaining negotiation to be true and meaningful, the
employees, first of all, must organize themselves.
Because self-organization is a prerequisitethe
lifebloodof industrial democracy, the right to self-
organize has been enshrined in the Constitution, and any
act intended to weaken or defeat the right is regarded by
law as an offense. The offense is technically called unfair
labor practice (ULP). Literally, it does not mean an unfair
practice by labor but a practice unfair to labor, although
the offender may either be an employer or a labor
organization.

The victim of the offense is not just the workers as a
body and the well-meaning employers who value
industrial peace, but the State as well. Thus, the attack to
this constitutional right is considered a crime which
therefore carries both civil and criminal liabilities.

A consideration of the entire law on the matter clearly discloses
the intention of the lawmaker to consider acts which are
alleged to constitute unfair labor practices as violations of the
law or offenses, to be prosecuted in the same manner as a
criminal offense. The reason for this provision is that the
commission of an unfair labor practice is an offense against a
public right or interest and should be prosecuted in the same
manner as a public offense. The reason for the distinction
between an unfair labor practice case and a mere violation of
an employer of its contractual obligation towards an employees
is, x x x that unfair labor practice cases involve violations of a
public right or policy, to be prosecuted like criminal offenses
whereas a breach of an obligation of the employer to his
employee is only a contractual breach to be redressed like an
ordinary contract or obligation.

1.1 Elements

Commission of unfair labor practice at the enterprise
level needs the presence of certain elements: first, there
is employer-employee relationship between the
offender and the offended; and second, the act done is
expressly defined in the Code as an act of unfair labor
practice. The first element is required because ULP is
negation of, a counteraction to, the right to organize
which is available only to employees in relation to their
employer. No organizational right can be negated or
assailed if employer-employee relationship is absent in
the first place.

The second element is that the act done is prohibited by
the Code, specifically in Articles 248 and 261 for an
employer and Article 249 for a labor organization. Art.
212(k) emphatically defines unfair labor practice as
any unfair labor practice as expressly defined in this
Code. Art. 261 amplifies Art. 248(i) by stating that
violation of a CBA is unfair labor practice only if the
violation is gross in character.

The prohibited acts, it should be stressed, are all related
to the workers self-organizational right and to the
observance of a collective bargaining agreement (CBA).
The only possible exception is Art. 248(f) referring to
dismissing or prejudicing an employee giving testimony
under this Code [regardless of the subject of the
testimony].

Because ULP is and has to be related to the right to self-
organization and to the observance of the CBA, it follows
that not every unfair act is unfair labor practice.

ULP, therefore, has a limited, technical meaning because
it is a labor relations concept with a statutory definition.
It refers only to acts opposed to workers right to
organize. Without that element, the act, no matter how
unfair, is not unfair labor practice as legally defined.

Stripped of legalese, unfair labor practice, when
committed by the employer, commonly connotes anti-
unionism.

1.2 Prejudice to Public Interest not an Element of U.L.P.

A showing of prejudice to public interest is not a
requisite for ULP charges to prosper.

2. PROSECUTION OF U.L.P.

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63 | P L A T O N
Under Art. 247 ULP has civil as well as criminal aspects.
The civil aspect may include liability for damages and
these may be passed upon by a labor arbiter.

To prosecute ULP as criminal offense is not possible until
after finality of judgment in the labor case, finding that
the respondent indeed committed unfair labor practice.
But such judgment will not serve as evidence of ULP in
the criminal case; the criminal charge must be proved
independently from the labor case. Moreover, while only
substantial evidence is required in labor case in the
NLRC, proof beyond reasonable doubt is needed to
convict in the criminal case of ULP.

The criminal charge, states Art. 228, falls under the
concurrent jurisdiction of the Municipal or Regional Trial
Court. The same article defines the penalty of fine and/
or imprisonment.

Under Art. 289, the penalty shall be imposed upon the
guilty officers of a corporation, partnership, association
or entity. If the ULP is committed by a labor organization
the parties liable are those mentioned in Art. 249.

The offense prescribes in one year. (Art. 290)
________

Chapter II
UNFAIR LABOR PRACTICES OF EMPLOYERS

Article 248. Unfair labor practices of employers. It shall
be unlawful for an employer to commit any of the
following unfair labor practice:

(a) To interfere with, restrain or coerce employees in the
exercise of their right to self-organization;

(b) To require as a condition of employment that a
person or an employee shall not join a labor organization
or shall with-draw from one to which he belongs;

(c) To contract out services or functions being performed
by union members when such will interfere with, restrain
or coerce employees in the exercise of their rights to self-
organization;

(d) To initiate, dominate, assist or otherwise interfere
with the formation or administration of any labor
organization, including the giving of financial or other
support to it or its organizers or supporters;

(e) To discriminate in regard to wages, hours of work and
other terms and conditions of employment in order to
encourage or discourage membership in any labor
organization. Nothing in this Code or in any other law
shall stop the parties from requiring membership in a
recognized collective bargaining agent as a condition for
employment, except those employees who are already
members of another union at the time of the signing of
the collective bargaining agreement. Employees of an
appropriate bargaining unit who are not members of the
recognized collective bargaining agent may be assessed a
reasonable fee equivalent to the dues and other fees
paid by members of the recognized collective bargaining
agent, if such non-union members accept the benefits
under the collective bargaining agreement: Provided,
that the individual authorization required under Article
242, paragraph (o) of this Code shall not apply to the
non-members of the recognized collective bargaining
agent;

(f) To dismiss, discharge or otherwise prejudice or
discriminate against an employee for having given or
being about to give testimony under this Code;

(g) To violate the duty to bargain collectively as
prescribed by this Code;

(h) To pay negotiation or attorneys fees to the union or
its officers or agents as part of the settlement of any
issue in collective bargaining or any other dispute; or

(i) To violate a collective bargaining agreement.

The provisions of the preceding paragraph
notwithstanding, only the officers and agents of
corporations, associations or partnerships who have
actually participated in, authorized or ratified unfair
labor practices shall be held criminally liable. (As
amended by Batas Pambansa Bilang 130, August 21,
1981).
________

1. CONDITIONS PRECEDENT TO U.L.P. CHARGE

Before an employee may be considered aggrieved by an
alleged unfair labor practice (ULP) by an employer, it
must be demonstrated, firstly, that the injured party
comes within the definition of employee as that term is
defined by the Code, and secondly, the act charged as
ULP must fall under the prohibition of Art. 248 (acts of
the employer) or 249 (acts of the union).

Nonetheless, specific denomination of the act is not
necessary to prosecute ULP. In resolving the question of
whether or not an employer committed the act charged
in the complaint, it is of no consequence, either as a
matter of procedure or of substantive law, how the act is
denominatedwhether as a restraint, interference or
coercion, or a discriminatory discharge, or as a refusal to
bargain, or even as a combination of any or all of these.
For however the employers conduct may be
LABOR RELATIONS
64 | P L A T O N
characterized, what is important is that it constituted an
unfair labor practice.

2. ILO CONVENTION NO. 98

Article 1

1. Workers shall enjoy adequate protection against acts of anti-
union discrimination in respect of their employment.

2. Such protection shall apply more particularly in respect of
acts calculated to--

(a) make the employment of a worker subject to the condition
that he shall not join a union or shall relinquish trade union
membership;

(b) cause the dismissal of or otherwise prejudice a worker by
reason of union membership or because of participation in
union activities outside working hours or, with the consent of
the employer, within working hours.

Article 2

1. Workers' and employers' organisations shall enjoy adequate
protection against any acts of interference by each other or
each other's agents or members in their establishment,
functioning or administration.

2. In particular, acts which are designed to promote the
establishment of workers' organisations under the domination
of employers or employers' organisations, or to support
workers' organisations by financial or other means, with the
object of placing such organisations under the control of
employers or employers' organisations, shall be deemed to
constitute acts of interference within the meaning of this
Article.

3. NO U.L.P.: ILLUSTRATIVE INSTANCES OF VALID
EXERCISE OF MANAGEMENT RIGHTS

The law on unfair labor practices is not intended to
deprive employers of their fundamental right to
prescribe and enforce such rules as they honestly believe
to be necessary to the proper, productive and profitable
operation of their business. Nor are his rights of selection
and discharge of his employees wrested from him by the
Act. Rothenberg stresses that an employer, subject to the
provisions of his contract with his employees, has the
same full measure of control over his business as he had
prior to the enactment of the Wagner Act and
undiminished by the amended Act. The only condition
imposed upon this control is that it must not be
exercised so as to effect a violation of the Act and its
several prohibitions.

3.1 Personnel Movements

As a rule, it is the prerogative of the company to
promote, transfer or even demote its employees to other
positions when the interests of the company reasonably
demand it. Unless there are instances which directly
point to interference by the company with the
employees' right to self-organization, the transfer of
private respondent should be considered as within the
bounds allowed by law. Furthermore, although private
respondent was transferred to a lower position, his
original rank and salary remained undiminished.

It is the companys prerogative to promoteits employees
to managerial positions. Managerial positions are offices
which can only be held by persons who have the trust of
the corporation and its officers. It should not be
prevented from doing so. A promotion which is
manifestly beneficial to an employee should not give rise
to a gratuitous speculation that such a promotion was
made simply to deprive the union of the membership of
the promoted employee.

3.2 Acceptance of Mass Resignation

Acceptance of a voluntary resignation is not ULP. In a
Philippine Airlines case the court said that the pilots
"protest retirement/resignation" was not a concerted
activity which was protected by law.They did not assume
the status of strikers. They cannot, therefore, validly
claim that the company committed unfair labor practice.
When the pilots voluntarily terminated their
employment relationship with the company, they cannot
claim that they were dismissed.

3.3 Grant of Profit-Sharing Benefits to Non-Union
Members

Management has the prerogative to regulate, according
to its discretion and judgment, all aspects of
employment. This flows from the established rule that
labor law does not authorize the substitution of the
judgment of the employer in the conduct of its business.
Such management prerogative may be availed of without
fear of any liability so long as it is exercised in good faith
for the advancement of the employers' interest and not
for the purpose of defeating or circumventing the rights
of employees under special laws or valid agreement and
are not exercised in a malicious, harsh, oppressive,
vindictive or wanton manner or out of malice or spite.

3.4 Forced Vacation Leave

Where the vacation leave without pay, which the
employer requires employees to take in view of the
economic crisis, is neither malicious, oppressive or
vindictive, ULP is not committed.

LABOR RELATIONS
65 | P L A T O N
3.5 Issuance of Rules or Policy

Every business enterprise endeavors to increase its
profits. In the process, it may adopt or devise means
designed towards that goal.

Even as the law is solicitous of the welfare of the
employees, it must also protect the right of an employer
to exercise what are clearly management prerogatives.
The free will of management to conduct its own business
affairs to achieve its purpose cannot be denied.

3.6 Taking Action Against Slowdown

Employees have the right to strike, but they have no right
to continue working on their own terms while rejecting
the standards desired by their employer. Hence, an
employer does not commit an unfair labor practice by
discharging employees who engaged in a slowdown,
even if their object is a pay increase which is lawful.
Moreover, an employer does not violate the act by
discharging only some of the employees who participate
in the slowdown where he discharges them to serve as
an example to stop the slowdown and not for
discriminatory reasons.

4. DETERMINATION OF VALIDITY

Necessarily, determining the validity of an employers act
involves an appraisal of his motives.

An employer may treat freely with an employee and is not
obliged to support his actions with a reason or purpose.
However, where the attendant circumstances, the history of
employer's past conduct and like considerations, coupled with
an intimate connection between the employer's action and the
union affiliations or activities of the particular employee or
employees taken as a whole raise a suspicion as to the
motivation for the employer's action, the failure of the
employer to ascribe a valid reason therefor may justify an
inference that his unexplained conduct in respect of the
particular employee or employees was inspired by the latter's
union membership or activities.

While the presence of this mere suspicion neither takes the
place of evidence that the employer's conduct was improperly
motivated nor dispenses with the requirement of proof of the
fact, such suspicion, when coupled with other facts which in
themselves, might have been inadequate to support an adverse
finding against the employer, may suffice to sustain a finding
that the employer's action violated the prohibition of the Act.

5. FIRST U.L.P.: INTERFERENCE (ART. 248[a])

In summarized form, the nine U.L.P. acts of an employer
under Art. 248 are: (1) Interference, (2) yellow dog
condition, (3) contracting out, (4) company unionism, (5)
discrimination, (6) discrimination because of testimony,
(7) violation of duty to bargaining, (8) paid negotiation,
and (9) violation of CBA.

5.1 Interrogation

Persistent interrogation of employees to elicit
information as to what had happened at union meetings
and the identity of the active union employees was held
as violative of organizational rights of employees.

In order that the questioning of an employee concerning
his union activities would not be deemed coercive, the
employer must communicate to the employee the
purpose of the questioning, assure him that no reprisal
would take place, and obtain his participation on a
voluntary basis. In addition, questioning must also occur
in a context free from employer hostility to union
organization and must not itself be coercive in nature.

5.2 U.L.P. Even Before Union is Registered

An employer who interfered with the right to self-
organization before the union is registered can be held
guilty of ULP.

5.3 Prohibiting Organizing Activities

A rule prohibiting solicitation of union membership in
company property is unlawful if it applies to non-working
time as well as to working time.

Where majority of the employees live on the premises of
the employer and cannot be reached by any means or
procedures practically available to union organizers, the
employer may be required to permit non-employee
union organizers to come within its premises, in order to
solicit employees.

However, in the absence of showing that the illegal
dismissal was dictated by anti-union motives, the same
does not constitute an unfair labor practice as would be a
valid ground for strike. The remedy is an action for
reinstatement with backwages and damages.

We have held that unfair labor practice cases are not, in
view of the public interest involved, subject to
compromises.

5.4 Violence or Intimidation

An employer unlawfully coerced employees by directing
two individuals to his office at gun point on the day of
representation election after the individuals had
informed the employer that they were on the premises
to vote in the election.

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5.5 Espionage and Surveillance

One form of pressure which some over-eager
employers sometimes use is the practice of spying upon
employees. This device consists of using one or a small
group of employees, or other agents, inspired by profit
opportunism, vengeance or come kindred human frailty
to use his or their access to employees quarters and
affairs for the purpose of spying upon fellow employees
and reporting back to the employer. It is plainly evident
that such conduct on the employers part, however
subtly it may be accomplished, constitutes interference
with the employees exercise of their rights. Inasmuch as
the pressure results more from the employees
apprehension than from the employers purpose in
spying and the use of its result, it has been held to be no
answer to a charge of unfair labor practice that the fruits
of espionage were not used.

When an employer engages in surveillance or takes steps
leading his employees to believe it is going on, a violation
results because the employees come under threat of
economic coercion or retaliation for their union
activities. Unlawful surveillance was properly found
where supervisors were present near the place where
union meeting was being held to check the names of
employees leaving the meeting.

5.6 Economic Inducements

A violation results from an employers announcement of
benefits prior to a representation election, where it is
intended to induce the employees to vote against the
union.

It is well-settled rule that while a representation election
is pending, the conferral of employee benefits for the
purpose of inducing the employees to vote against a
union is unlawful.

5.7 Employers Expression of Opinion; Totality of Conduct
Doctrine

The doctrine holds that the culpability of employers
remarks was to be evaluated not only on the basis of
their implications, but against the background of and in
conjunction with collateral circumstances.

(1) Letter to individual employeesItis an act of interference
for the employer to send a letter to all employees notifying
them to return to work at a time specified therein, otherwise
new employees would be engaged to perform their jobs.
Individual solicitation of the employees or visiting their homes,
with the employer or his representative urging the employees
to cease union activity or cease striking, constitutes unfair labor
practice. All the above-detailed activities are unfair labor
practices because they tend to undermine the concerted
activity of the employees, an activity to which they are entitled
free from the employer's molestation.

(2) Strike-breakingWhen the respondent company offered
reinstatement and attempted to "bribe" the strikers with
"comfortable cots," "free coffee and occasional movies,"
"overtime" pay for "work performed in excess of eight hours,"
and "arrangements" for their families, so they would abandon
the strike and return to work, they were guilty of strike-
breaking and/or union-busting and, consequently, of unfair
labor practice.

(3) Acts violative of right to organizeViolativeof the right to
organize, form and join labor organizations are the following
acts: the offer of a Christmas bonus to all "loyal" employees of
a company shortly after the making of a request by the union to
bargain; wage increases given for the purpose of mollifying
employees after the employer has refused to bargain with the
union, or for the purpose of inducing striking employees to
return to work; the employer's promises of benefits in return
for the strikers' abandonment of their strike in support of their
union; and the employer's statement, made about 6 weeks
after the strike started, to a group of strikers in a restaurant to
the effect that if the strikers returned to work, they would
receive new benefits in the form of hospitalization, accident
insurance, profit-sharing, and a new building to work in.

(4) Test of interference or coercionThetest of whether an
employer has interfered with and coerced employees within
the meaning of subsection (a) (1) is whether the employer has
engaged in conduct which it may reasonably be said tends to
interfere with the free exercise of employees' rights under
section 3 of the Act, and it is not necessary that there be direct
evidence that any employee was in fact intimidated or coerced
by statements of threats of the employer if there is a
reasonable inference that anti-union conduct of the employer
does have an adverse effect on self-organization and collective
bargaining.

(5) The totality of conduct doctrinethe letters of the
company president to the individual strikers should not be
considered by themselves alone but should be read in the light
of the preceding and subsequent circumstances. The letters
should be interpreted according to the "totality of conduct
doctrine,"whereby the culpability of an employer's remarks has
to be evaluated not only on the basis of their implicit
implications, but were to be appraised against the background
of and in conjunction with collateral circumstances.

5.8 Mass Layoff Amounting to U.L.P.

A companys capital reduction efforts, to camouflage the
fact that it has been making profits, and to justify the
mass lay-off of its employees especially union members,
were an unfair labor practice which can neither be
countenanced nor condoned.

5.9 Lockout or Closure Amounting to U.L.P.

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A lockout, actual or threatened, as a means of dissuading
the employees from exercising their rights under the Act
is clearly an unfair labor practice. However, to hold an
employer who actually or who threatens to lock out his
employees guilty of a violation of the Act, the evidence
must establish that the purpose thereof was to interfere
with the employees exercise of their rights.

An honest closing of ones plant is not a violation of the
Act. However, cessation of operations, actual or
threatened, does constitute an unfair labor practice, if it
is, directly or indirectly, expressly or by innuendo,
calculated or employed to interfere with the employees
rights under the Act. Proof of the employers state of
mind, unless it is expressed, is often very difficult.
However, it may be proven by circumstantial evidence.

The rule is that it is unlawful for the employer to
threaten its employees with moving or shutting down the
plant and consequent loss of employment, as the result
of their support for the union.

An employer which closed its business to put an end to a
unions activities, and which made no effort to allow the
employees attempt to exercise their right to self-
organization and collective bargaining, and even
threatening the employees that they would lose their
jobs if they did not cease affiliation with the union,
commits unfair labor practice.

5.9a Sale in Bad Faith

Where the sale of a business enterprise was attended with bad
faith, there is no need to consider the applicability of the rule
that labor contracts being in personam are not enforceable
against the transferee. The latter is in the position of tort-feasor
having been a party likewise responsible for the damage
inflicted on the members of the aggrieved union and therefore
cannot justly escape liability.

It is irrational to suppose that a purchaser of a
manufacturing enterprise is not aware of the labor-
management situation in the firm he bought.

5.9b Assumption of Obligations by New Company

5.10 Successor Employer; Piercing the Corporate Veil

Closure is likewise not legal and the employees cannot be
separated if, in fact, there is no closure because the
closed department or company reappeared although
under a new name. If the new company is, for instance,
engaging in the same business as the closed company or
department, or is owned by the same people, and the
closure is calculated to defeat the workers
organizational right, then, the closure may be declared a
subterfuge and the doctrine of successor employer will
be applied, that is, the new company will be treated as a
continuation or successor of the one that closed. If such
be the case, the separated employees will have to be
employed in the new firm because in the first place
they should not have been separated at all.

The successor employer ruling is an enforcement of the
legal recourse called piercing the veil of corporate
entity.

Under the doctrine of piercing the veil of corporate entity,
when valid grounds therefore exist, the legal fiction that a
corporation is an entity with a juridical personality separate and
distinct from its members or stockholders may be disregarded.
In such cases, the corporation will be considered as a mere
association of persons. The members or stockholders of the
corporation will be considered as the corporation, that is,
liability will attach directly to the officers and stockholders. The
doctrine applies when the corporate fiction is used to defeat
public convenience, justify wrong, protect fraud, or defend
crime, or when it is made as a shield to confuse the legitimate
issues or where a corporation is the mere alter ego or business
conduit of a person, or where the corporation is so organized
and controlled and its affairs are so conducted as to make it
merely an instrumentality, agency, conduit or adjunct of
another corporation.

6. SECOND U.L.P.: YELLOW DOG CONDITION (ART.
248[b])

Contract provisions whereby an employee agrees that
during the period of his employment he will not become
a member of a labor union have been outlawed in the
United States, by legislation in some states, as well as by
Federal legislation.

The yellow dog contract is a promise exacted from
workers as a condition of employment that they are not
to belong to, or attempt to foster, a union during their
period of employment.

An American scheme, the typical yellow dog contract is
an at-will employment agreement which contains, in
addition to the usual provisions for employment, the
following three provisions: (1) a representation by the
employee that he is not a member of a labor union; (2) a
promise by the employee not to join a labor union; (3) a
promise by the employee that, upon joining a labor
union, he will quit his employment.

7. THIRD U.L.P.: CONTRACTING OUT (ART. 248[c])

Contracting out itself, is not ULP; it is the ill intention that
makes it so.

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An employers contracting out of work is itself an unfair
labor practice where motivated by a desire to prevent his
employees from organizing and selecting a collective
bargaining representative, rid himself of union men, or
escape his statutory duty to bargain collectively with his
employees bargaining representative.

As we have previously held, the company can determine in its
best business judgment whether it should contract out the
performance of some of its work for as long as the employer is
motivated by good faith, and the contracting out must not have
been resorted to to circumvent the law or must not have been
the result of malicious or arbitrary action.

7.1 Contracting out restricted by CBA

7.2 Runaway Shop

Resorting to a runaway shop is a U.L.P. A runaway shop
is defined as an industrial plant moved by its owners
from one location to another to escape union labor
regulations or state laws, but the term is also used to
describe a plant removed to a new location in order to
discriminate against employees at the old plant because
of their union activities. Moreover, it has been held that
where a plant removal is for business reasons but the
relocation is hastened by anti-union motivation, the early
removal is an unfair labor practice. It is immaterial that
the relocation is accompanied by a transfer of title to a
new employer who is an alter ego of the original
employer.

Runaway shop refers to business relocation animated by
anti-union animus. Sameness of business is not reason
enough to show run-away shop to pierce the veil of
separate corporate entity.

A "runaway shop" is defined as an industrial plant moved by its
owners from one location to another to escape union labor
regulations or state laws, but the term is also used to describe a
plant removed to a new location in order to discriminate
against employees at the old plant because of their union
activities. It is one wherein the employer moves its business to
another location or it temporarily closes its business for anti-
union purposes. A "runaway shop" in this sense, is a relocation
motivated by anti-union animus rather than for business
reasons.

Mere ownership by a single stockholder or by another
corporation of all or nearly all of the capital stock of a
corporation is not of itself sufficient ground for disregarding the
separate corporate personality.

This fiction of corporate entity can only be disregarded in
certain cases such as when it is used to defeat public
convenience, justify wrong, protect fraud, or defend crime. To
disregard said separate juridical personality of a corporation,
the wrongdoing must be clearly and convincingly established.

8. FOURTH U.L.P.: COMPANY-DOMINATION OF UNION
(ART. 248[d])

Domination of a labor union usually manifests in the
following forms:

(a) Initiation of the company union idea. This may further
occur in three styles: (1) outright formation by the
employer or his representatives; (2) employee formation
on outright demand or influence by employer; and (3)
managerially motivated formation by employees.

(b) Financial support to the union. An employer commits
unfair labor practice if he defrays the union expenses or
pays the attorneys fees to the attorney who drafted the
constitution and by-laws of the union.

(c) Employer encouragement and assistance.
Immediately granting the union exclusive recognition as
a bargaining agent without determining whether the
union represents the majority of employees is an illegal
form of assistance amounting to unfair labor practice.

(d) Supervisory assistance. This takes the form of
soliciting membership, permitting union activities during
working time or coercing employees to join the union by
threats of dismissal or demotion.

An employer was held to have unlawfully aided a union
by assisting its attempt to secure authorization cards
from employees and by executing a contract with such
union when it was not the authorized representative of
the employees.

A labor union is company-dominated where it appears that key
officials of the company have been forcing employees
belonging to a rival labor union to join the former under pain of
dismissal should they refuse to do so; that hey officials of the
company, as well as its legal counsel, have attended the
election of officers of the former union; that officers and
members of the rival union were dismissed allegedly pursuant
to a retrenchment policy of the company, after they had
presented demands for the improvement of the working
conditions despite its alleged retrenchment policy; and that,
after dismissal of the aforesaid officers of the rival labor union,
the company engages the services of new laborers.

9. FIFTH U.L.P.: DISCRIMINATION (ART. 248[e])

What the law prohibits is discrimination to encourage or
discourage membership in a labor organization. Where
the purpose is to influence the union activity of
employees, the discrimination is unlawful. But
discrimination is not the same as differentiation or
classification. For instance, it is common management
practice to classify jobs and grant them varying levels of
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pay benefits package. These are valid differentiations
that recognize differences in job requirements or
contributions. They are not necessarily discrimination
classifiable as ULP.

Under the Industrial Peace Act, to constitute an unfair labor
practice, the discrimination committed by the employer must
be in regard to the "hire or tenure of employment or any term
or condition of employment to encourage or discourage
membership in any labor organization." The exaction, by the
Company, from the strikers returning to work, of a promise not
to destroy company property and not to commit acts of reprisal
against the Union-members who did not participate in the
strike, cannot be considered as intended to encourage or
discourage Union-membership. Taking the circumstances
surrounding the prescribing of that condition, the requirement
by the Company is actually an act of self-preservation and
designed to insure the maintenance of peace and order in the
Company premises.

Discouraging membership in a labor organization
includes not only discouraging adhesion to union
membership but also discouraging participation in union
activities such as legitimate strike.

9.1 Discrimination in Work Quota

Considered in the light of the anti-union attitude exhibited by
respondent company in transferring union president Leones
from the main office in Manila to Cebu when the union was still
being organized, and which act was found by the NLRC as
constituting unfair labor practice and union-busting in
connection with the application for clearance to terminate
Leones filed by respondent company, 34 the uneven
application of its marketing plan by respondent company is
patently an act of discrimination, considered as an unfair labor
practice under Art. 248(e) of the Labor Code.

9.2 Discrimination in Bonus Allocation or Salary
Adjustments

There is unfair and unjust discrimination in the granting
of salary adjustments where the evidence shows that (a)
the management paid the employees of the unionized
branch; (b) where the salary adjustments were granted
to employees of one of its nonunionized branches
although it was losing in its operations; and (c) the total
salary adjustments given every ten of its unionized
employees would not even equal the salary adjustments
given one employee in the nonunionized branch.

9.3 Discrimination in Layoff or Dismissal

Even where business conditions justified a layoff of
employees, unfair labor practices in the form of
discriminatory dismissal were found where only unionists
were permanently dismissed while nonunionists were
not.

Labor is a person's means of livelihood. He cannot be deprived
of his labor or work without due process of law. Retrenchment
very heart of one's employment. While the right of strikes at
the very heart of an employer to dismiss an employee is
conceded in a valid retrenchment, the right differs from and
should not be confused with the manner in which such right is
exercised. It should not be oppressive and abusive since it
affects one's person and property. Due process of law demands
nothing less.

9.4 Discrimination in Regularization

9.5 Discrimination by Blacklisting

A blacklist has been defined as a list of persons marked
out for special avoidance, antagonism or enmity on the
part of those who prepare the list, or those among whom
it is intended to circulate, as where a trade union
blacklists workmen who refuse to conform to its rules,
or where a list of insolvent or untrustworthy persons is
published by a commercial agency or mercantile
association.

When it is resorted to by a combination of employers to
prevent employment of employees for union activities, it
may constitute unfair labor practice. Aside from
constituting an unfair labor practice, it may give rise to a
right of action for damages by the employees prejudice
under Article 28 of the new Civil Code.

In its broad sense, however that is, in the sense of the
employers circulating a list of former employees of notorious
laziness or negligence in the performance of their duties or of
incorrigible propensity to create trouble in the place of
employment, it may be a proper measure for the protection of
employers. Thus, it has been held that unless the action of the
employers in combining or in passing communications among
themselves for the purpose of excluding unwanted workers
from employment, constitutes a libel or slander (and according
to some decisions the defamation, to be actionable, must be
malicious), the excluded employee possesses no right of action
because the employers community of interest acts both to
justify the combination and to privilege the communication.

9.6 Indirect Discrimination

It is a well settled rule of law that what is prohibited to
be done directly shall not be allowed to be accomplished
indirectly.

Thus, the following acts have been held unfair labor
practices: (1) the dismissal of a laborer in account of
union activities of his brother; (2) the discharge of an
employee due to the union activities of the wife; and (3)
the discharge of a wife due to the union activities of the
husband.

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9.7 Test of Discrimination

For the purpose of determining whether or not a
discharge is discriminatory, it is necessary that the
underlying reason for the discharge be established. The
fact that a lawful cause for discharge is available is not a
defense where the employee is actually discharged
because of his union activities. If the discharge is actually
motivated by a lawful reason, the fact that the employee
is engaged in union activities at the time will not lie
against the employer and prevent him from the exercise
of his business judgment to discharge an employee for
cause.

Where circumstances establish a discriminatory motive
on the part of the employer, the assignment of a just
cause will be unavailing. If it can be established that the
true and basic inspiration for the employers act is
derived from the employees union affiliations or
activities, the assignment by the employer of another
reason, whatever its semblance of validity, is unavailing.

An interference that the discharge of an employee was
motivated by his union activity must be based upon
evidence, direct or circumstantial, not upon mere
suspicion.

9.8 Constructive Discharge

Where the employer prohibits employees from
exercising their rights under the Act, on pain of
discharge, and the employee quits as a result of the
prohibition, a constructive discharge occurs, which may
be remedies in an unfair labor practice proceeding.

9.9 Discharge Due to Union Activity, A Question of Fact

The question of whether an employee was discharged because
of his union activities is essentially a question of fact as to
which the findings of the Court of Industrial Relations are
conclusive and binding if supported by substantial evidence
considering the record as a whole. This is so because the
Industrial Court is governed by the rule of substantial evidence,
rather than by the rule of preponderance of evidence as in any
ordinary civil cases. Substantial evidence has been defined as
such relevant evidence as a reasonable mind might accept as
adequate to support a conclusion. It means such evidence
which affords a substantial basis from which the fact in issue
can be reasonably inferred.

9.10 Valid Discrimination: Union Security Clause

There is a form of encouragement of union membership
which is not considered ULP. This is where Management
and Union enter into a collective bargaining agreement
containing a union security clause. Despite variations and
limitations, a union security clause essentially requires
membership in the union so that an employee may retain
his job and the unions existence is assured.

Union security is a generic term which is applied to and
comprehends closed shop, union shop,
maintenance of membership or any other form of
agreement which imposes upon employees the
obligation to acquire or retain union membership as a
condition affecting employment. It is indeed compulsory
union membership whose objective is to assure
continued existence of the union. In a sense, there is
discrimination when certain employees are obliged to
join a particular union. But it is discrimination favouring
unionism; it is a valid kind of discrimination.

The employer is not guilty of unfair labor practice if it
merely complies in good faith with the request of the
certified union for the dismissal of employees expelled
from the union pursuant to the union security clause in
the collective bargaining agreement.

9.10a Kinds of Union Security Agreements

Closed-shop: Only union members can be hired by the
company and they must remain as union members to
retain employment in the company.

Union Shop: Nonmembers may be hired, but to retain
employment must become union members after a
certain period. The requirement applies to present and
future employees.

Modified Union Shop: Employees who are not union
members at the time of signing the contract need not
join the union, but all workers hired thereafter must join.

Maintenance of Membership Shop: No employee is
compelled to join the union, but all present or future
members must, as a condition of employment, remain in
good standing in the union.

Exclusive Bargaining Shop: The union is recognized as the
exclusive bargaining agent for all employees in the
bargaining unit, whether union members or not.

Bargaining for Members Only: The union is recognized as
the bargaining agent only for its own members

Agency Shop: An agreement whereby employees must
either join the union or pay the union as exclusive
bargaining agent a sum equal to that paid by the
members. This is directed against free rider employees
who benefits from union activities without contributing
financially to union support. It prevents situation where
non-union members enrich themselves at the expense of
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union members. Another term for agency shop
agreement is maintenance of treasury shop.

The above variations are opposite of open shop, an
arrangement which does not require union membership
as a condition of employment.

9.10b Validity of Closed-Shop Agreement

It is true that disaffiliation from a labor union is not open to
legal objection. It is implicit in the freedom of association
ordained by the Constitution. But this Court has laid down the
ruling that a closed shop is a valid form of union security, and
such provision in a collective bargaining agreement is not a
restriction of the right of freedom of association guaranteed by
the Constitution.

It is the policy of the State to promote unionism to enable the
workers to negotiate with management on the same level and
with more persuasiveness than if they were to individually and
independently bargain for the improvement of their respective
conditions. To this end, the Constitution guarantees to them
the rights "to self-organization, collective bargaining and
negotiations and peaceful concerted actions including the right
to strike in accordance with law." There is no question that
these purposes could be thwarted if every worker were to
choose to go his own separate way instead of joining his co-
employees in planning collective action and presenting a united
front when they sit down to bargain with their employers. It is
for this reason that the law has sanctioned stipulations for the
union shop and the closed shop as a means of encouraging the
workers to join and support the labor union of their own choice
as their representative in the negotiation of their demands and
the protection of their interest vis-a-vis the employer.

A closed-shop agreement is an agreement whereby an
employer binds himself to hire only members of the contracting
union who must continue to remain members in good standing
to keep their jobs. It is "the most prized achievement of
unionism." It adds membership and compulsory dues. By
holding out to loyal members a promise of employment in the
closed-shop, it welds group solidarity. It is a very effective form
of union security agreement.

9.10c Advantages and Disadvantages of Closed-Shop
Agreement

A closed-shop agreement is advantageous because it

a. Increases the strength and bargaining power of labor
organizations.

b. Prevents non-union workers from sharing in the
benefits of the unions activities without also sharing its
obligations.

c. Prevents the weakening of labor organizations by
discrimination against union members.

d. Eliminates the lowering of standards caused by
competition with non-union workers.

e. Enables labor organizations effectively to enforce
collective agreements.

f. Facilitates the collection of dues and the enforcement
of union rules.

g. Creates harmonious relations between the employer
and employee.

But it is disadvantageous as it

a. Results in monopolistic domination of employment by
labor organizations.

b. Interferes with the freedom of contract and personal
liberty of the individual worker.

c. Compels employers to discharge all non-union workers
regardless of efficiency, length of service, etc.

d. Facilitates the use of labor organizations by
unscrupulous union leaders for the purpose of extortion,
restraint of trade, etc.

e. Denies to non-union workers equal opportunity for
employment.

f. Enables union to charge exorbitant dues and initiation
fees.

9.10d Valid Dismissal Because of Application of Union
Security Clause

Union security clauses in collective bargaining agreements, if
freely and voluntarily entered into, are valid and binding.
Corollary, dismissals pursuant to union security clauses are
valid and legal subject only to the requirement of due process,
that is, notice and hearing prior to dismissal. Thus, the dismissal
of an employee by the company pursuant to a labor union's
demand in accordance with a union security agreement does
not constitute unfair labor practice.

Even if the union members were unaware of the closed-shop
stipulation in the CBA, they were bound by it. Neither their
ignorance of, nor their dissatisfaction with its terms and
conditions would justify breach thereof or the formation by
them of a union of their own. This is so because a union
member who is employed under an agreement between the
union and his employer is bound by the provisions thereof,
since it is a joint and several contract of the members of the
union entered into by the union as their agent.

This provision is an indirect restriction on the right of an
employee to self-organization. It is a solemn pronouncement of
a policy that while an employee is given the right to join a labor
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organization, such right should only be asserted in a manner
that will not spell the destruction of the same organization The
law requires loyalty to the union on the part of its members in
order to obtain to the full extent its cohesion and integrity.

9.10e Dismissal Pursuant to Closed-Shop Clause Must
Clearly Appear in Contract

In order to validly dismiss an employee by force of the
union security clause, there should be a clear and
unequivocal statement that the loss of the status of a
member of good standing in the union shall be a cause
for dismissal.

Union shop, as with closed-shop provisions, should be
strictly construed against the existence of union shop.
Sometimes harsh and onerous, such provisions should
not be extended beyond the explicit coverage of their
terms, and will not be deemed to authorize by
implication any dismissal of employees already working
before the agreement was made.

9.10f Due Process Required in Enforcing Union Security
Clause; Intra-union Matter becomes Termination Dispute
with Employer

Although a union security clausein a CBA may be validly
enforced and that dismissal pursuant thereto may
likewise be valid, this does not erode the fundamental
requirement of due process. The reason behind the
enforcement of union security clauses which is the
sanctity and inviolability of contracts cannot override
one's right to due process.

9.10g Liability of Union to Pay Wages and Fringe Benefits
of Illegally Dismissed Employee

9.10h Employer in Good Faith Not Liable

9.10i Closed-Shop, To Whom Not Applicable

All employees in the bargaining unit covered by a closed-
shop agreement are subject to its terms, except the
following: (1) any employee who at the time the closed-
shop agreement takes effect is a bona fide member of
religious organization which prohibits its members from
joining labor unions on religious grounds; (2) employees
already in the service and already members of a labor
union or unions other than the majority union at the
time the closed-shop agreement took effect; (3)
Confidential employees who are excluded from the rank-
and-file bargaining unit; and (4) employees excluded
from the closed-shop by express terms of the agreement.

It is well settled in this jurisdiction that, in the absence of a
manifest intent to the contrary, "closed shop" provisions in a
collective bargaining agreement "apply only to persons to be
hired or to employees who are not yet members of any labor
organization" and that said provisions of the agreement are not
applicable to those already in the service at the time of its
execution. To hold that the employees in a company who are
members of a minority union may be compelled to disaffiliate
from their union and join the majority or contracting union,
would render nugatory the right of all employees to self
organization and to form, join or assist labor organizations of
their own choosing, a right guaranteed by the Industrial Peace
Act (sec. 3, Rep. Act No. 875) as well as by the Constitution (Art.
III, sec. 1[6]).

9.10j Agency Fee Instead of Union Membership

The employees who are benefitting from the CBA,
without being members of the bargaining union, may be
required to pay an agency fee. The collection of agency
fees in an amount equivalent to union dues and fees,
from employees who are not union members, is
recognized by Article 248 (e) of the Labor Code. A written
authorization from the non-union employee is imposed.
The employee's acceptance of benefits resulting from a
collective bargaining agreement justifies the deduction of
agency fees from his pay and the union's entitlement
thereto. In this aspect, the legal basis of the union's right
to agency fees is neither contractual nor statutory, but
quasi-contractual, deriving from the established principle
that non-union employees may not unjustly enrich
themselves by benefiting from employment conditions
negotiated by the bargaining union.

The justification of collecting agency fee is the unions
accomplishment in having negotiated a CBA in behalf of
the employees. The union served as agent of the
employees, and the agency fee is recognition of the
agents efforts. The fee is collectible only from
employees deriving economic benefits from the union-
negotiated CBA.

10. SIXTH U.L.P.: DISCRIMINATION BECAUSE OF
TESTIMONY (ART. 248[f])

The law protects not only the employees right to form,
join, or assist labor organizations but also their right to
testify on matters covered by the Code. If this right is not
protected, the right to self-organization will be indirectly
defeated because the employees will fear their
employers reprisal. By protecting the employees right
to testify, the law therefore shields the workers right to
self-organization from indirect assault by the employer.
Thus, it is ULP to dismiss, discharge, or otherwise
prejudice or discriminate against an employee for having
given or being about to give testimony under this Code.

Employers reprisal against a testifying employee is ULP
because, furthermore, it violates the right to engage in
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73 | P L A T O N
concerted activity, a right included in the right to self-
organize (Art. 246) and reiterated in Article 263(b).
Concerted activity does not always require a number of
people acting in unison. An employee acting alone in
pursuing a group interest may be said to be doing a
concerted activity which the employer may not curtail.

10.1 Refusal to Testify

Clearly, the efforts to justify petitioner's dismissal on top of
the private respondent's scheme of inducing his employees to
sign an affidavit absolving him from possible violations of the
Labor Code taints with evident bad faith and deliberate
malice petitioner's summary termination from
employment.The pivotal question in any case where unfair
labor practice on the part of the employer is alleged is whether
or not the employer has exerted pressure, in the form of
restraint, interference or coercion, against his employee's right
to institute concerted action for better terms and conditions of
employment. Without doubt, the act of compelling employees
to sign an instrument indicating that the employer observed
labor standards provisions of law when he might have not,
together with the act of terminating or coercing those who
refuse to cooperate with the employer's scheme constitutes
unfair labor practice. The first act clearly preempts the right of
the hotel's workers to seek better terms and conditions of
employment through concerted action.

10.2 Labor Standards Violation May Lead to a Srike

Art. 118. Retaliatory measures. It shall be unlawful for an
employer to refuse to pay or reduce the wages and
benefits, discharge or in any manner discriminate against
any employee who has filed any complaint or instituted
any proceeding under this Title or has testified or is
about to testify in such proceedings.

And yet, Articles 118 and 248 are related. They both
speak of employees filing a complaint or giving
testimony. But the subject of complaint or testimony
under Article 118 is limited to matters about wages, the
subject of Title I of Book III. Under Article 248, on the
other hand, the subject testified to is any issue covered
by the Code. Both articles likewise speak of retaliation by
the employer. Retaliation is wrong, and more than that,
Article 248 considers it an unfair labor practice which,
under Art. 263, is a legal reason for employees to hold a
strike.

11. SEVENTH U.L.P.: VIOLATION OF THE DUTY TO
BARGAIN (ART. 248[g])

The seventh ULP act under Art. 248 refers to violating the
duty to bargain. See Articles 252 and 253

12. EIGHT U.L.P.: PAID NEGOTIATION (ART. 248[h])

Self-organization and collective bargaining are treasured
rights of workers. The law zealously shields them from
corruption. It is a punishable act of ULP for the employer
to pay the union or any of its officers or agents any
negotiation fee or attorneys fee as part of settlement in
collective bargaining or any labor dispute. To do so is not
unlawful. It is ethically reprehensible.

13. NINTH U.L.P.: VIOLATION OF THE CBA (ART. 248[i])

After a CBA is concluded, its implementation follows.
Implementation is still part of the bargaining process
which, it should be recalled, rests on the parties duty to
bargain. The duty to bargain, it should also be recalled,
requires good faith. And good faith implies faithful
observance of what has been agreed upon. It logically
follows that noncompliance with the agreement is non-
observance of good faith in bargaining; therefore, the
noncompliance amounts to ULP.

But such violation, to constitute ULP, must be gross,
according to Art. 261.

14. RELIEF IN U.L.P. CASES

14.1 Cease and Desist Order

To support a cease and desist order, the record must
show that the restrained misconduct was an issue in the
case; that there was a finding of fact of said misconduct
and such finding of fact was supported by evidence. The
Court is not authorized to issue blank cease and desist
orders, but must confine its injunction orders to specific
act or acts which are related to past misconduct. A cease
and desist order is not invalidated because the act
complained of was voluntarily discontinued prior to or
during the course of the proceedings. But if the act
complained of happened so long a time that there is no
longer any threat or probability of a recurrence, a cease
and desist order will not be justified.

14.2 Affirmative Order

The Court does not only have the power to issue
negative or prohibitive orders but also affirmative or
positive orders.

The order may usually direct the full reinstatement of the
discharged employees to their substantially equivalent
position without prejudice to their seniority and other
rights and privileges.

14.3 Order to Bargain; Mandated CBA

Likewise, when an employer has failed or refused to
bargain with the proper bargaining agent of his
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74 | P L A T O N
employees, the Court may, in addition to the usual cease
and desist orders, issue an affirmative order to compel
the respondent to bargain with the bargaining agent.

14.4 Disestablishment

Where the employer had initiated, dominated or assisted
in or interfered with the formation or establishment of
any labor organization or contributed financial or other
support to it, the Court may issue, in addition to a cease
and desist order, an order directing the employer to
withdraw all recognition from the dominated labor union
and to disestablish the same.

15. U.L.P. NOT SUBJECT TO COMPROMISE

Unfair labor practice cases are not, in view of the public
interest involved, subject to compromises. The relation
between capital and labor are not merely contractual.
They are so impressed with the public interest that labor
contracts must yield to the common good.

16. U.L.P. IN A GIVEN PERIOD SHOULD BE INCLUDED IN
SINGLE CHARGE

When a labor union accuses an employer of acts of unfair
labor practice allegedly committed during a given period
of time, the charges should include all acts of unfair labor
practice committed against any and all members of the
Union during that period. The Union should not, upon
the dismissal of the charges first preferred, be allowed to
split its cause of action and harass the employer with
subsequent charges. based upon acts committed during
the same period of time.

17. EMPLOYERS RESPONSIBILITY FOR U.L.P. ACTS BY
SUBORDINATE OFFICIALS

Knowledge by the employer of the employees improper
acts: Where it was established that the employer was
aware of the employees wrongdoing, his failure to
prevent continuation of the course of conduct or his
failure to renounce any connection or affinity therewith,
invited the imputation of fault and responsibility to the
employer.

Continuity of improper conduct by employee: A single
utterance by a supervisory employee, whether
improvident or deliberate on the employees part, was
not ordinarily and n absence of proof of actual authority
held to be sufficient to convict an employer of an unfair
labor practice; however, continued, repeated or
widespread activities by such supervisory employee in
affront of the rights of the body of employees was
deemed ample justification for ascribing knowledge and
blame to the employer.

Employers past policy and attitude: It has been held that,
among other things, the similarity between the past
attitude or policy of the employer and that of the
offending supervisory employee might, in certain cases,
be indicative of a concert of effort between the two.
________

Chapter III
UNFAIR LABOR PRACTICES OF LABOR ORGANIZATIONS

Article 249. Unfair labor practices of labor organizations.
- It shall be unfair labor practice for a labor organization,
its officers, agents or representatives:

(a) To restrain or coerce employees in the exercise of
their right to self-organization. However, a labor
organization shall have the right to prescribe its own
rules with respect to the acquisition or retention of
membership;

(b) To cause or attempt to cause an employer to
discriminate against an employee, including
discrimination against an employee with respect to
whom membership in such organization has been denied
or to terminate an employee on any ground other than
the usual terms and conditions under which membership
or continuation of membership is made available to
other members;

(c) To violate the duty, or refuse to bargain collectively
with the employer, provided it is the representative of
the employees;

(d) To cause or attempt to cause an employer to pay or
deliver or agree to pay or deliver any money or other
things of value, in the nature of an exaction, for services
which are not performed or not to be performed,
including the demand for fee for union negotiations;

(e) To ask for or accept negotiation or attorneys fees
from employers as part of the settlement of any issue in
collective bargaining or any other dispute; or

(f) To violate a collective bargaining agreement.

The provisions of the preceding paragraph
notwithstanding, only the officers, members of governing
boards, representatives or agents or members of labor
associations or organizations who have actually
participated in, authorized or ratified unfair labor
practices shall be held criminally liable. (As amended by
Batas Pambansa Bilang 130, August 21, 1981).
________

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75 | P L A T O N
1. RESTRAINT OR COERCION BY LABOR ORGANIZATION;
INTERFERENCE BY UNION IS NOT ULP

A labor organization commits ULP when it restrains or
coerces employees in their right to self-organization. This
provision of Art. 249(a) parallels with Art. 248(a). But
interference is left out. This deliberate omission is the
equivalent of license of labor organization to engage in
those practices which, at the hands of an employer,
would constitute actionable unfair labor practices by way
of interference. In other words, a labor organization
may interfere in the employees right to self-organization
as long as the interference does not amount to restraint
or coercion.

Interference by a labor organization is not ULP because
interfering in the exercise of the right to organize is itself
a function of self-organizing.

1.1 Coercing Participation in Strike

The provision is violated by a unions restraining or
coercing an employee in the exercise of his right to
refuse to participate in or recognize a strike. Similarly,
violation is committed when a union threatens
employees with bodily harm in order to force them to
strike.

2. UNION-INDUCED DISCRIMINATION

The law forbids as ULP union attempts to cause an
employer to grant advantages for union members over
non-members, for union members in good standing over
suspended or expelled members, for union members
over permit holders, for members of the union executive
board over more senior employees, for members of one
union over members of another union, or for members
of one local over members of another local.

The forbidden discrimination may refer to terms of hiring
or firing, in layoff, in seniority, or in benefits.

2.1 Arbitrary Use of Union Security Clause

The broad rule is that the union has the right to
determine its membership and to prescribe the
conditions for the acquisition and retention thereof.
Consequently, admission to membership may not be
compelled. This rule, however, is qualified in the case of
labor unions holding a monopoly in the supply of labor,
either in a given locality, or as regards a particular
employer by reason of a closed-shop or similar
agreements. In such case, qualified applicants may not
be arbitrarily excluded from membership and their
admission may not be barred by unreasonable rules.

It is well settled that labor unions are not entitled to arbitrarily
exclude qualified applicants for membership, and a closed-shop
provision would not justify the employer in discharging, or a
union in insisting upon the discharge of, an employee whom
the union thus refuses to admit to membership, without any
reasonable ground therefor.4 Needless to say, if said unions
may be compelled to admit new members, who have the
requisite qualifications, with more reason may the law and the
courts exercise the coercive power when the employee
involved is a long standing union member, who, owing to
provocations of union officers, was impelled to tender his
resignation, which he forthwith withdrew or revoked. Surely,
he may, at least, invoke the rights of those who seek admission
for the first time, and cannot arbitrarily he denied readmission.

The Court stresses, however, that union security clauses are
also governed by law and by principles of justice, fair play, and
legality. Union security clauses cannot be used by union
officials against an employer, much less their own members,
except with a high sense of responsibility, fairness, prudence,
and judiciousness.

A union member may not be expelled from her union, and
consequently from her job, for personal or impetuous reasons
or for causes foreign to the closed-shop agreement and in a
manner characterized by arbitrariness and whimsicality.

2.2 Not Disloyalty to Ask Help from Another Union

3. REFUSAL TO BARGAIN

ULP under Art. 249(c) is intended to insure that unions
approach the bargaining table with the same attitude of
willingness to agree as the Act requires of management.

A union violates its duty to bargain collectively by
entering negotiations with a fixed purpose of not
reaching an agreement or signing a contract.

4. FEATHERBEDDING AND MAKE-WORK
ARRANGEMENTS

Art. 249(d) refers to featherbedding. Featherbedding is
the name given to employee practices which create or
spread employment by unnecessarily maintaining or
increasing the number of employees used, or the amount
of time consumed, to work on a particular job.

In spite of employee assertions that these so-called
featherbedding practices are directly related to job
security, health and safety, most courts at common law
found these practices to be economically wasteful and
without any legitimate employee justification.
________

Title VII
COLLECTIVE BARGAINING AND
ADMINISTRATION OF AGREEMENTS
LABOR RELATIONS
76 | P L A T O N

ART. 250. Procedure in collective bargaining. - The
following procedures shall be observed in collective
bargaining:

(a) When a party desires to negotiate an agreement, it
shall serve a written notice upon the other party with a
statement of its proposals. The other party shall make a
reply thereto not later than ten (10) calendar days from
receipt of such notice;

(b) Should differences arise on the basis of such notice
and reply, either party may request for a conference
which shall begin not later than ten (10) calendar days
from the date of request.

(c) If the dispute is not settled, the Board shall intervene
upon request of either or both parties or at its own
initiative and immediately call the parties to conciliation
meetings. The Board shall have the power to issue
subpoenas requiring the attendance of the parties to
such meetings. It shall be the duty of the parties to
participate fully and promptly in the conciliation
meetings the Board may call;

(d) During the conciliation proceedings in the Board, the
parties are prohibited from doing any act which may
disrupt or impede the early settlement of the disputes;
and

(e) The Board shall exert all efforts to settle disputes
amicably and encourage the parties to submit their case
to a voluntary arbitrator. (As amended by Section 20,
Republic Act No. 6715, March 21, 1989).
________

Article 251. Duty to bargain collectively in the absence of
collective bargaining agreements. In the absence of an
agreement or other voluntary arrangement providing for
a more expeditious manner of collective bargaining, it
shall be the duty of employer and the representatives of
the employees to bargain collectively in accordance with
the provisions of this Code.
________

1. NATURE OF COLLECTIVE BARGAINING

1.1 Definition

Collective bargaining or negotiations towards a collective
agreement is a democratic framework to stabilize the
relation between labor and management and to create a
climate of sound and stable industrial peace. It is a
mutual responsibility of the employer and the Union and
is characterized as a legal obligation.

Collective bargaining includes four related but
distinguishable processes:
(1) negotiation between representatives of the
management and the union over wages, hours, and
other terms of employment;

(2) the execution of a written contract embodying the
terms agreed upon;

(3) negotiation of any question arising as to the
interpretation or application of the contract; and

(4) negotiation over the terms of a new contract or
proposed modifications, when an existing agreement is
validly opened for negotiations.

Collective bargaining is a system made up of a set of
continuous processes; it is customary and helpful to
distinguish negotiation of contracts (the legislative
phase of the union-employer relationship),
administration of contracts (the executive phase), and
interpretation or application of contracts (the judicial
phase).

In common usage as well as in legal terminology,
collective bargaining denotes negotiations looking
forward to a collective agreement. However, it does not
end with the execution of an agreement. It is a
continuous process. It requires both parties, the
employer and duly authorized representatives of
employees, to deal with each other with open and fair
minds and sincerely endeavor to fight the obstacles in
the process to stabilize employer-employee relationship.

1.1a CBA Defined

A collective bargaining agreement (CBA), as used in
Article 252 of the Labor Code, refers to a contract
executed upon request of either the employer or the
exclusive bargaining representative incorporating the
agreement reached after negotiations with respect to
wages, hours of work and all other terms and conditions
of employment, including proposals for adjusting any
grievances or questions arising under such agreement.

While the terms and conditions of a CBA constitute the law
between the parties, it is not, however, an ordinary contract to
which is applied the principles of law governing ordinary
contracts. A CBA, as a labor contract within the contemplation
of Article 1700 of the Civil Code of the Philippines which
governs the relations between labor and capital, is not merely
contractual in nature but impressed with public interest, thus, it
must yield to the common good. As such, it must be construed
liberally rather than narrowly and technically, and the courts
must place a practical and realistic construction upon it, giving
due consideration to the context in which it is negotiated and
purpose which it is intended to serve.
LABOR RELATIONS
77 | P L A T O N

A CBA is more than a contract; it is a generalized code to
govern a myriad of cases which the draftsmen wholly
anticipate. It covers the whole employment relationship
and prescribes the rights and duties of the parties.

1.2 Rationale

By collective bargaining the employee shares through
his chosen representatives in fixing the conditions under
which he works, and a rule of law is substituted for
absolute authority.

1.3 Strength of the Collective Bargaining Method

Collective bargaining is also a means of ensuring workers
participation in decision-making. The notion that workers
are entitled to participate in setting the terms under
which they are to work is inherent in collective
bargaining; even the most rudimentary form of collective
bargaining involves a transfer of certain issues, be it only
wages, from the area of unilateral to the area of bilateral
decision-making.

It provides an opportunity for the exchange of
information tending to enhance the understanding of the
parties for each other problems and objectives, both
where they differ and where they are identical.

Moreoverand this is very importantit provides an
orderly procedure by which each side can seek to present
to the other the best possible case for the satisfaction of
its particular demands.

It elicits the consent of those who will have to live under
the terms of any agreement derived from the bargaining
process. Stability is an important element in
employment, and consent assures stability because
parties who have accepted an agreement will live by its
terms.

2. EMERGENCE OF COLLECTIVE BARGAINING

First in Great Britain, but not much later in other
countries, working men sought to protect themselves
against the harsh effects of new machines, new methods
of production, new divisions of labor and new intensities
of competition by forming organizations capable of
representing their interests as a group vis--vis
employees and the State.

2.1 Originator

The credit for coining the expression belongs to Beatrice
Webb, who first used it in 1891 in her study on The
Cooperative Movement in Great Britain.

In non-English speaking countries, particularly on the
European continent, where the process of collective
bargaining has an equally long history, the emphasis was
placed on the term collective agreement because
during the early period the workers aimed not so much
at establishing the procedure of bargaining itself as at
having such agreements recognized and enforced as
legally binding contracts.

2.2 Adoption in the Philippines

In the Philippines the idea of collective bargaining first
gained formal and official recognition through
Commonwealth Act No. 213, approved by President
Manuel L. Quezon on November 21, 1936.

But it is the Industrial Peace Act (RA No. 875, approved
by President Elpidio Quirino on June 17, 1953), that
defined collective bargaining and outlined its procedure.

3. PARTIES TO COLLECTIVE BARGAINING

The duty to bargain collectively arises only between the
employer and its employees. Where neither party is
an employer nor an "employee" of the other, no such
duty would exist. Needless to add, where there is no duty
to bargain collectively the refusal to bargain violates no
right.

The parties, then, to collective bargaining as traditionally
understood, are the employer and the employees
represented by their labor union.

Article. 212. (j) "Bargaining representative" means a legitimate
labor organization whether or not employed by the employer.

The bargaining representative of the employees is an
entitythe unionand not the officers of the union.

4. JURISDICTIONAL PRECONDITIONS OF COLLECTIVE
BARGAINING

While it is a mutual obligation of the parties to bargain,
the employer, however, is not under any legal duty to
initiate contract negotiation. The mechanics of collective
bargaining is set in motion only when the following
jurisdictional preconditions are present, namely:
(1) possession of the status of majority representation of
the employees' representative in accordance with any of
the means of selection or designation provided for by the
Labor Code;

(2) proof of majority representation; and

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78 | P L A T O N
(3) a demand to bargain under Article 251, par. (a) of the
New Labor Code.

An employers duty to recognize and bargain collectively
with a union as the collective bargaining representative
of his employees does not arise until after the union
requests the employer to bargain. Hence, an employer is
not in default respecting the duty to bargain until a
request therefor has been made.

It is essential to the right of a putative bargaining agent to
represent the employees that it be the delegate of a majority of
the employees and, conversely, an employer is under duty to
bargain collectively only when the bargaining agent is
representative of the majority of the employees. A natural
consequence of these principles is that the employer has the
right to demand of the asserted bargaining agent proof of its
representation of its employees. Having the right to
demonstration of this fact, it is not an 'unfair labor practice' for
an employer to refuse to negotiate until the asserted
bargaining agent has presented reasonable proof of majority
representation. It is necessary however, that such demand be
made in good faith and not merely as a pretext or device for
delay or evasion. The employer's right is however to reasonable
proof.

4.1 Bargaining with Minority Union, ULP

Where a majority representative has been designated, it
is an unfair labor practice, [for the employer] as a refusal
of collective bargaining, to deal and negotiate with the
minority representative.

On the union side, where there exists a legitimate issue
as to which of several unions is the legitimate
representative of employees, it is ULP for one of the
unions to stage a strike and demand that the employer
sit down with it for collective bargaining.

5. WHEN BARGAINING SHOULD BEGIN

If the three jurisdictional preconditions are present, the
collective bargaining should begin within the 12 months
following the determination and certification of the
employees exclusive bargaining representative. This
period is known as the certification year.

The employers duty to bargain during the certification
year has been held to extend throughout the entire year.
Absent unusual circumstances, an employer commits an
unfair labor practice by refusing to bargain with the
union during its certification year, notwithstanding the
repudiation of the union by a majority of its employees
before the expiration of the one-year period. The rule is
the same whether the union lost its majority as a result
of the employers unfair labor practices or through no
fault of the employer.

A union which has been certified by the NLRB as a
bargaining representative for a particular unit enjoys an
irrefutable presumption of a majority status for one year,
absent special circumstances. Following the expiration of
the one-year certification period, there continues to be a
presumption in favor of a union majority, though the
presumption is rebuttable. Employee turnover does not
constitute unusual circumstances shortening the
period.

6. SINGLE ENTERPRISE BARGAINING PROCEDURE
BROADLY DESCRIBED

The law gives primacy to free collective bargaining (Art.
211) and allows the parties to devise their bargaining
rules (Art. 251). This is the basic reason the bargaining
procedure is governed primarily by agreement of the
parties.

In the presence of validly agreed procedure, the Labor
Code procedure applies suppletorily only.

D.O. No. 40-03 supplements the codal provisions:

Section 3. When single enterprise bargaining available. - Any
voluntarily recognized or certified labor union may demand
negotiations with its employer for terms and conditions of work
covering employees in the bargaining unit concerned.

Section 4. Procedure in single enterprise bargaining - A
recognized or certified labor union that desires to negotiate
with its employer shall submit such intention in writing to the
employer, together with its proposals for collective bargaining.

The recognized or certified labor union and its employer
may adopt such procedures and processes they may
deem appropriate and necessary for the early
termination of their negotiations. They shall name their
respective representatives to the negotiation, schedule
the number and frequency of meetings, and agree on
wages, benefits and other terms and conditions of work
for all employees covered in the bargaining unit.

7. MULTI-EMPLOYER BARGAINING

Collective bargaining may take place at the national,
industry, or enterprise level.

The Philippines so far has tried only enterprise-level, or
decentralized bargaining.

7.1 Rationale of Multi-employer Bargaining

When a number of employees join forces for purposes of
collective bargaining, the unit structure is described as a
LABOR RELATIONS
79 | P L A T O N
multi-employer bargaining unit. The structure may
consist of an association representing employers, or even
a whole industry, or it may be composed of only a few
employers who bargain as a group, or through an
association.

Competitive pressures are the dominant forces that
encourage both unions and employers to enter into
multi-employer or industry-wide bargaining
relationships. Small employers in highly competitive and
labor-intensive fields may find it easier to operate with
uniformity of labor cost.

The multi-employer unit is particularly advantageous to
both sides in industries composed of many small,
financially weak employers.

Multi-employer bargaining provides both management
and unions with significant cost savings in negotiation of
labor agreements. It is cheaper to negotiate one master
multi-employer agreement than a number of single-
employer agreements.

There are, however, other considerations than costs,
such as intra-organizational issues, that the parties take
into account before opting for multi-employer units.
Multi-employer bargaining may not only overlook the
needs of various employee groups, but also ignore
particular requirements of individual employers.

What may be readily acceptable to one employer may be
considered as financially disastrous by another.

To arrive at multi-employer agreements is much more
difficult than to arrive at single-employer contracts. The
expanded size of the unit composed of many
heterogeneous groups leads to intensive intra-
organizational bargaining both on the unions and on the
employers side. At times, these intra-organizational
pressures may lead to lengthy delays in negotiations and
even to breakdown of bargaining.

7.2 Multi-employer Bargaining Procedure (D.O. No. 40-
03)

Section 5. When multi-employer bargaining available. - A
legitimate labor union(s) and employers may agree in writing to
come together for the purpose of collective bargaining,
provided:
(a) only legitimate labor unions who are incumbent exclusive
bargaining agents may participate and negotiate in multi-
employer bargaining;

(b) only employers with counterpart legitimate labor unions
who are incumbent bargaining agents may participate and
negotiate in multi-employer bargaining; and

(c) only those legitimate labor unions who pertain to employer
units who consent to multi-employer bargaining may
participate in multi-employer bargaining.

Section 6. Procedure in multi-employer bargaining. - Multi-
employer bargaining may be initiated by the labor unions or by
the employers.
(a) Legitimate labor unions who desire to negotiate with their
employers collectively shall execute a written agreement
among themselves, which shall contain the following:

1) the names of the labor unions who desire to avail of multi-

2) each labor union in the employer unit;

3) the fact that each of the labor unions are the incumbent
exclusive bargaining agents for their respective employer units;

4) the duration of the collective bargaining agreements, if any,
entered into by each labor union with their respective
employers.

Legitimate labor unions who are members of the same
registered federation, national, or industry union are exempt
from execution of this written agreement.

(b) The legitimate labor unions who desire to bargain with
multi-employers shall send a written notice to this effect to
each employer concerned. The written agreement stated in the
preceding paragraph, or the certificates of registration of the
federation, national, or industry union, shall accompany said
notice.

Employers who agree to group themselves or use their existing
associations to engage in multiemployer bargaining shall send a
written notice to each of their counterpart legitimate labor
unions
indicating their desire to engage in multi-employer bargaining.
Said notice shall indicate the following:

1) the names of the employers who desire to avail of multi-

2) their corresponding legitimate labor organizations;

3) the fact that each corresponding legitimate union is any
incumbent exclusive bargaining agent;

4) the duration of the current collective bargaining agreement,
if any, entered into by each employer with the counterpart
legitimate labor union.

(c) Each employer or concerned labor union shall express its
willingness or refusal to participate in multi-employer
bargaining in writing, addressed to its corresponding exclusive
bargaining agent or employer. Negotiations may commence
only with regard to respective employers and labor unions who
consent to participate in multi-employer bargaining;

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(d) During the course of negotiations, consenting employers
and the corresponding legitimate labor unions shall discuss and
agree on the following:

1) the manner by which negotiations shall proceed;

2) the scope and coverage of the negotiations and the
agreement; and

3) where appropriate, the effect of the negotiations on current
agreements or conditions of employment among the parties.

Section 7. Posting and registration of collective bargaining
agreement. - Two (2) signed copies of collective bargaining
agreement reached through multi-employer bargaining shall be
posted for at least five ( 5) days in two conspicuous areas in
each workplace of the employer units concerned. Said
collective bargaining agreement shall affect only those
employees in the bargaining units who have ratified it.

The same collective bargaining agreement shall be registered
with the Department in accordance with the following Rule.

7.4 Optional

Under D.O. No. 40-03 multi-employer bargaining is
purely optional for employers and unions.

Unlike other bargaining units, the multi-employer unit is
based primarily on the consent of the firms involved.
________

Article 252. Meaning of duty to bargain collectively.
The duty to bargain collectively means the performance
of a mutual obligation to meet and convene promptly
and expeditiously in good faith for the purpose of
negotiating an agreement with respect to wages, hours
of work and all other terms and conditions of
employment including proposals for adjusting any
grievances or questions arising under such agreement
and executing a contract incorporating such agreements
if requested by either party but such duty does not
compel any party to agree to a proposal or to make any
concession.
________

Article 253. Duty to bargain collectively when there exists
a collective bargaining agreement. When there is a
collective bargaining agreement, the duty to bargain
collectively shall also mean that neither party shall
terminate nor modify such agreement during its lifetime.
However, either party can serve a written notice to
terminate or modify the agreement at least sixty (60)
days prior to its expiration date. It shall be the duty of
both parties to keep the status quo and to continue in
full force and effect the terms and conditions of the
existing agreement during the 60-day period and/or until
a new agreement is reached by the parties.
________

1. DUTY TO BARGAIN DEFINED

The law contemplates and defines two situations when
the duty to bargain exists: Situation one, when there is
yet no collective bargaining agreement (Art. 252), and
Situation two, where a CBA exists (Art. 253).

For Situation One, the duty to bargain means in essence
the mutual obligation of the employer and the
employees majority union to meet and convene.

The purposes of the meeting and convening are:

(1) to negotiate an agreement on the subjects of:

(a) wages, (b) hours of work, and (c) all other terms and
conditions of employment including proposals for
adjusting grievances or questions arising under such
agreement; and

(2) to execute a contract incorporating such agreement if
requested by either party.

The kind of compliance required is prompt, expeditious,
and in good faith.

The limitations or reservations of the duty are that it
does not compel any party to agree to a proposal or to
make a concession.

For Situation Two, the duty to bargain means all of the
above and, additionally, the obligation not to terminate
or modify the CBA during its lifetime. But 60 days before
the CBA expires, either party may notify the other in
writing that it desires to terminate or modify the
agreement. During the 60-day period and until a new
agreement is reached, the CBA remains in full force and
effect; the parties are duty-bound to keep the status
quo. The law therefore provides for automatic renewal
or extension of the CBA. This 60-day period under Art.
253 refers to submission of proposals to renegotiate the
nonrepresentational provisions of the CBA. It does not
always coincide with the 60-day period mentioned in
Articles 253-A and 256 pertaining to freedom period to
resolve representation contest between unions

1.1 Four Forms of ULP in Bargaining

(1) failure to meet and convene; (2) evading the
mandatory subjects of bargaining; (3) bad faith in
bargaining, including failure or refusal to execute the
collective agreement, if requested; and (4) gross violation
of the CBA.

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2. FIRST U.L.P. IN BARGAINING: FAILURE OR REFUSAL
TO MEET AND CONVENE

An employer is guilty of an unfair labor practice in
refusing to bargain with the representative of a majority
of his employees. To bargain in good faith, an employer
must not only meet and confer with the union which
represents his employees, but also must recognize the
union for the purpose of collective bargaining. In
addition, he must recognize the union as the bargaining
representative of all the employees in the appropriate
bargaining unit, even if they are not all members of the
union.

The duty to bargain extends beyond the period of
contract negotiations, and applies to labor-management
relations during the term of the agreement. Since a
collective bargaining agreement does not define all the
rights and obligations of the employer and his
employees, negotiation of grievances is part and parcel
of the bargaining process.

The failure of refusal of an employer to bargain
collectively with his employees constitutes an enjoinable
unfair labor practice not only under the subdivision of
the Act dealing expressly with collective bargaining,
but also under the subsection making it an unfair labor
practice to: interfere with, restrain or coerce
employees in the exercise of their guaranteed rights, on
the theory that refusal by an employer to bargain
collectively with his employees constitutes
interference with the latters right of self-organization.

2.1 Unresolved Petition for Union Cancellation

2.2 Selling the Company

If an employer is guilty of unfair labor practice when he
directly discharges his employees to forestall a demand
for collective bargaining, he certainly should not be
allowed to evade responsibility if he indirectly causes
that discharge by selling to a company that he knows is
unwilling to accept his employees.

The basic rule is that if the transfer of assets and
employees from one employer to another leaves intact
the identity of the employing enterprise, the transferors
duty to recognize and bargain with an incumbent union
devolves upon the transferee as successor employer.
That means that an acquiring employer is a successor to
the bargaining obligations of his predecessor if there is a
continuity in the business operation. Only a high degree
of enterprise continuity will justify imposing obligations
under a contract with the union to which the new
employer was not a party.

A mere change in ownership of a business is insufficient
to alter a unions status as bargaining representative.

2.3 Successor Employer: Continuity and Identity

In making the determination as to whether an employer
is successor, the NLRB looks to the totality of
circumstances to determine whether there has been a
substantial and material alteration in the employing
enterprise. If there is a substantial and material
alteration in the employing enterprise, the new employer
need not bargain with the incumbent union.

2.4 Conversion to Independent Franchise or Operation

A decision to withdraw capital from a company-operated
facility and relinquish the operating control to an
independent dealership lies very much at the core of
entrepreneurial control, and hence is not a mandatory
subject of bargaining

2.5 Do Economic Exigencies Justify Refusal to Bargain?

An employer has been held not guilty of a refusal to
bargain by adamantly rejecting the unions economic
demands where he is operating at a loss, on a low profit
margin, or in a depressed industry, as long as he
continues to negotiate.

2.6 Acts not Deemed Refusal to Bargain

The duty to bargain is not violated by:

(1) adoption of an adamant bargaining position in good
faith, particularly when the company is operating at a
loss;

(2) refusal to bargain over demands for commission of
unfair labor practices;

(3) refusal to bargain during period of illegal strike.

If a union engages in an illegal strike, the employer has
no obligation to bargain until he is notified that the illegal
strike has been terminated.

Where, pursuant to an honest doubt, the employer has
demanded additional proof or acquisition of an official
certification of bargaining agency, there is no obligation
or duty on the employers part to enter into negotiations
until the demanded proof is presented pending the
certification proceedings, unless it can be established
that the demand lacks in good faith and is intended as an
obstruction to negotiations.

Neither is the duty to bargain violated where:
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(1) there is no request for bargaining;

(2) the union seeks recognition for an inappropriately
large unit;

(3) the union seeks to represent some persons who are
excluded from the Act;

(4) the rank-and-file unit includes supervisors or
inappropriate otherwise;

(5) the demand for recognition and bargaining is made
within the year following a certification election in which
the clear choice was no union and no ad interim
significant change has taken place in the unit;

(6) the union makes unlawful bargaining demands.

2.7 Alleged Interference in the Selection of the Unions
Negotiation Panel

In order to show that the employer committed ULP under the
Labor Code, substantial evidence is required to support the
claim. Substantial evidence has been defined as such relevant
evidence as a reasonable mind might accept as adequate to
support a conclusion.

2.8 Non-reply to Proposal; CBA Imposed on Employer

Collective bargaining, designed to stabilize the relation
between labor and management and to create a climate of
sound and stable industrial peace. It is a legal obligation, so
much so that Article 248 of the Labor Code makes it an unfair
labor practice for an employer to refuse "to meet and convene
promptly and expeditiously in good faith for the purpose of
negotiating an agreement with respect to wages, hours of
work, and all other terms and conditions of employment.

We agree with the pronouncement that it is not obligatory
upon either side of a labor controversy to precipitately accept
or agree to the proposals of the other. But an erring party
should not be tolerated and allowed with impunity to resort to
schemes feigning negotiations by going through empty
gestures.

2.8a Repetition in Divine Word University

A companys refusal to make counter proposal if considered in
relation to the entire bargaining process, may indicate bad faith
and this is especially true where the Unions request for a
counter proposal is left unanswered. Moreover, the Court
added in the same case that it is not obligatory upon either
side of a labor controversy to precipitately accept or agree to
the proposals of the other. But an erring party should not be
tolerated and allowed with impunity to resort to schemes
feigning negotiations by going through empty gestures.

3. SECOND U.L.P. IN BARGAINING: EVADING THE
MANDATORY SUBJECTS

It is the obligation of the employer and the employees
representative to bargain with each other with respect to
wages, hours, and other terms and conditions of
employment. They are statutory or mandatory
proposals. An employers refusal to negotiate a
mandatory subject of bargaining is an unfair labor
practice although the employer has every desire to reach
agreement and earnestly and in all good faith bargains to
that end. On the other hand, an employers duty to
bargain is limited to the mandatory bargaining subjects;
as to other matters, he is free to bargain or not to
bargain.

A mere remote, direct, or incidental impact is insufficient
to render a subject a mandatory subject of bargaining; in
order for a matter to be subject to mandatory collective
bargaining, it must materially or significantly affect the
terms or conditions of employment.

3.1 Wages and Employment Conditions

The term wages, as used in 29 USCS Sec. 158(d), has
been held to include not only compensation but also
other emoluments of value furnished by the employer to
his employees. Under our Labor Code, wage refers to
remuneration or earnings, however designated, capable
of being expressed in terms of money, etc.

Since the passage of the Taft-Hartley Act, the National Labor
Relations Board has held that industrial pensions, group
insurance, and merit increases all are matters about which
employers must bargain collectively.

The following are examples of matters considered as
mandatory subjects of bargaining:

(1)Wages and other types of compensation, including
merit increases;

(2) Working hours and working days, including work
shifts;

(3) Vacations and holidays;

(4) Bonuses;

(5) Pensions and retirement plans;

(6) Seniority;

(7) Transfer;

(8) Lay-offs;
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(9) Employee workloads;

(10) Work rules and regulations;

(11) Rent of company houses;

(12) Union security arrangements.

3.1a Wage Agreement; Solomonic Approach

We take note of the "middle ground" approach employed by
the Secretary in this case which. we do not necessarily find to
be the best method of resolving a wage dispute. Merely finding
the midway point between the demands of the company and
the union, and "splitting the difference" is a simplistic solution
that fails to recognize that the parties may already be at the
limits of the wage levels they can afford. It may lead to the
danger too that neither of the parties will engage in principled
bargaining; the company may keep its position artificially low
while the union presents an artificially high position, on the fear
that a "Solomonic" solution cannot be avoided. Thus, rather
than encourage agreement, a "middle ground approach"
instead promotes a "play safe" attitude that leads to more
deadlocks than to successfully negotiated CBAs.

3.2 Workloads and Work Rules

Employee workloads are a mandatory subject of
bargaining. Employer rules concerning coffee breaks,
lunch periods, smoking, employee discipline, and dress
are also mandatory subjects of bargaining, as are plant
safety rules and general regulations.

Company rules relating to safety and work practices
come within the meaning of the phrase other terms and
conditions of employment as used in the Act and,
therefore, constitute a mandatory subject of collective
bargaining.

3.2a Code of Conduct

Work rules and regulations are commonly compiled into
a booklet usually called Code of Discipline or Code of
Conduct. Such dos and donts for employees of the
enterprise are work rules, forming part of terms and
conditions of employment, that are proper subjects of
collective bargaining. Hardly may the employer contend
that they are non-negotiable matters.

3.3 Management Prerogatives Clause

An employer does not commit an unfair labor practice by
insisting, to the point of a bargaining impasse, on the
inclusion in the contract of a management prerogatives
clause, even though some of the matters covered by the
clause are conditions of employment which are
mandatory subjects of bargaining under 29 USCS Sec.
158(d). Thus, an employers insistence that its decisions
regarding hiring and tenure of employment should not
be reviewable by arbitration is not a refusal to bargain.

3.4 Union Discipline Clause

An employer may bargain to an impasse over his
proposal that the union eliminate a piecework ceiling
imposed by a union rule which subjects members to
discipline for exceeding the production quota. However,
an employers insistence to the point of a bargaining
impasse on the unions withdrawal of fines imposed on
member-employees who crossed a picket line around the
employers plant is an unlawful refusal to bargain, since
the right not to withdraw fines is an internal union
affairs, a matter involving relations between employees
and their unions, and therefore not a mandatory
bargaining item.

3.5 Arbitration, Strike-Vote, or No-Strike Clause

An employer may lawfully bargain to an impasse over his
proposal that the collective bargaining agreement
include an arbitration clause or a no-strike clause which
prohibits the employees from striking during the life of
the agreement.

3.6 No-Lockout Clause; Clause Fixing Contractual Term

An employers statutory duty to bargain requires him to
negotiate over the unions proposal that their agreement
include a clause binding him not to lock out the
employees. An employers refusal to bargaining over the
duration of the contract to be entered into is also an
unfair labor practice. But an employers obligation to
enter into a collective bargaining agreement does not
require that the employer enter into an unalterable
obligation for an extended period of time, and many
collective bargaining agreements contain a clause
permitting termination or modification by either party
upon prescribed notice.

3.7 Signing Bonus

Signing bonus is a grant motivated by goodwill created
when a CBA is successfully negotiated and signed
between the employer and the union. Where goodwill
does not exist, why ask for a signing bonus?

In contractual terms, a signing bonus is justified by and is the
consideration paid for the goodwill that existed in the
negotiations that culminated in the signing of a CBA. Without
the goodwill, the payment of a signing bonus cannot be
justified and any order for such payment, to our mind,
constitutes grave abuse of discretion.
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In short, if the reason behind a signing bonus is absent,
no signing bonus need be given.

3.8 No Duty to Agree Even on Mandatory Subjects

The Act does not compel agreements between
employers and employees, and neither party is legally
obligated to yield even on a mandatory bargaining
subject. Where the subject of the dispute is a mandatory
bargaining subject, either party may bargain to an
impasse as long as he bargains in good faith. The duty to
bargain does not obligate a party to make concessions or
yield a position fairly held. Hence, an employers
adamant insistence on a bargaining position is not
necessarily a refusal to bargain in good faith.

Even if the negotiating party thumbs down the other
partys proposals, there is no violation of the duty to
bargainhence, no ULPas long as the negative reply
can be explained in good faith.

3.9 Non-mandatory Subjects

An employer cannot insist, to the point of creating a
bargaining impasse, on the inclusion of a provision
outside the scope of the statutory bargaining subjects,
even if he acts in good faith. On the other hand, it is
lawful to insist on the inclusion of a provision in a
collective bargaining agreement if the provision is within
the scope of a statutory subject of bargaining.

An employer bargains to an impasse over a non-
mandatory bargaining subject when he refuses to reach
any agreement with the union unless the union
capitulates to him on that subject. However, it has been
held that a bargaining impasse may be reached over a
non-mandatory bargaining subject although that subject
is not the sole cause for the parties failure to agree.
When a subject under discussion is not mandatory, it
may be discussed if both parties agree, but a strike or
lockout may not be used to compel a negotiation or
agreement.

While most matters that might be discussed or proposed
in collective bargaining are likely to bear some relation,
even if tenuous, to wage, hours, and other terms and
conditions of employment, not all proposals that
somehow respond to a problem that is customarily
bargained about may themselves be insisted upon to
impasse. By once bargaining and agreeing on a
permissive subject of bargaining, the parties do not make
the subject a mandatory topic of future bargaining.

3.10 Bargaining to the Point of Impasse: Not necessarily
Bad Faith

The adamant insistence on a bargaining position to the
point where the negotiations reach an impasse does not
establish bad faith. Neither can bad faith be inferred
from a partys insistence on the inclusion of a particular
substantive provision unless it concerns trivial matters or
is obviously intolerable.

The question as to what are mandatory and what are merely
permissive subjects of collective bargaining is of significance on
the right of a party to insist on his position to the point of
stalemate. A party may refuse to enter into a collective
bargaining contract unless it includes a desired provision as to a
matter which is a mandatory subject of collective bargaining;
but a refusal to contract unless the agreement covers a matter
which is not a mandatory subject is in substance a refusal to
bargain about matters which are mandatory subjects of
collective bargaining, and it is no answer to the charge of
refusal to bargain in good faith that the insistence on the
disputed clause was not the sole cause of the failure to agree or
that agreement was not reached with respect to other disputed
clauses.

Stated in another way, the ruling means that bargaining
to the point of deadlock may or may not amount to
bargaining in bad faith depending on whether the
insistence refers to a mandatory or a non-mandatory
subject of bargaining.

The reason is that the duty to bargain requires meeting
and convening on terms and conditions of employment
but does not require assent to the other partys
proposals.

Over a non-mandatory subject, on the other hand, a
party may not insist on bargaining to the point of
impasse, otherwise his insistence can be construed as
bargaining in bad faith. It may be construed as evasion of
the duty to bargain; such evasion is ULP.

The above rulings do not mean that non-mandatory
subjects cannot be proposed or that the proponent
cannot demand serious discussion of such proposal.
What the rulings forbid is the posture of making
settlement on a non-mandatory subject a precondition
to the discussion or settlement of a mandatory subject. If
a non-mandatory subject is proposed and agreed upon,
the agreeing party, by itself, is binding.

3.11 When Is There Deadlock or Impasse?

A bargaining impasse over an issue exists where good
faith bargaining on the part of the parties has failed to
resolve the issue and there are no definite plans for
further efforts to break the deadlock.

Impasse, within the meaning of the federal labor laws,
presupposes reasonable effort at good faith bargaining
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which, despite noble intentions, does not conclude in an
agreement between the parties. In the NLRBs view,
whether a bargaining impasse exists is a matter of
judgment dependent on such factors as the bargaining
history, the parties good faith in negotiations, the length
of the negotiations, the importance of the issue or issues
as to which there is disagreement, and the
contemporaneous understanding of the parties as to the
state of negotiations.

3.11a Duty to Bargain When There Is Deadlock or
Impasse

Deadlock does not mean the end of bargaining. It signals
rather the need to continue the bargaining with the
assistance of a third party as conciliator or arbitrator
whose first aim is to get the parties back to the
negotiating table and help them craft a win-win solution.

3.11b Strike or Lockout in Case of Deadlock

Bargaining may proceed smoothlyand this is the wish
of most negotiation panelsbut it may also be marred
by insinuations, misunderstandings, and apparently
irreconcilable bargaining positions. Deadlock develops. In
fact, deadlock may occur anytime for various reasons
such as unacceptability of a proposal or counter
proposal, grandstanding of a negotiator, autocratic or
arrogant stance, or imprecise wording of a stipulation.

The law (Art. 263) recognizes bargaining deadlock as a
valid reason to declare a strike or lockout. Strike/ lockout
presents a major deviation from the preferred smooth
route of bargaining. At this point of bargaining scenario,
strike/ lockout is supposed to be a method of resolving
an impasse, a device to constrain the parties to end an
impasse and go back to the negotiation table. But strike/
lockout, while meant to be a solution, frequently
becomes a problem in itself.

Although the union's petition was for "compulsory arbitration,"
the subsequent agreement of petitioner to submit the matter
for arbitration in effect made the arbitration a voluntary one.
The essence of voluntary arbitration, after all, is that it is by
agreement of the parties, rather than compulsion of law, that a
matter is submitted for arbitration. It does not matter that the
person chosen as arbitrator is a labor arbiter who, under Art.
217 of the Labor Code, is charged with the compulsory
arbitration of certain labor cases. There is nothing in the law
that prohibits these labor arbiters from also acting as voluntary
arbitrators as long as the parties agree to have him hear and
decide their dispute.

4. THIRD U.L.P. IN BARGAINING: BAD FAITH

Bargaining deadlock may be precipitated not only by
hard-line positions on mandatory or non-mandatory
subjects. It may also arise because of lack of good faith in
bargaining.

Good-faith bargaining demands more than sterile and
repetitive discussion of formalities precluding actual
negotiation, more than formal replies which constitute in
effect a refusal to treat with the union, and more than a
willingness to enter upon a sterile discussion of union-
management differences. It requires a sincere effort to
reach agreement, although it does not require
agreement itself. Moreover, the duty to bargain does not
end with the negotiation of the agreement.

The duty to bargain collectively may be violated without
a general failure of subjective good faith, and there is no
occasion to consider the issue of good faith if a party
refuses even to negotiate in fact about any of the
mandatory subjects. AN employer cannot be guilty of a
refusal to bargain if the union is not itself bargaining in
good faith.

4.1 Determination of Good Faith

The crucial question whether or not a party has met his
statutory duty to bargain in good faith typically turns on the
facts of the individual case. There is no per se test of good faith
in bargaining. Good faith or bad faith is an inference to be
drawn from the facts and is largely a matter for the NLRBs
expertise. To some degree, the question of good faith may be a
question of credibility.

A fair criterion of good faith in collective bargaining
requires that the parties involved deal with each other
with open and fair mind and sincerely endeavor to
overcome obstacles or difficulties existing between them
to the end that employment relations may be established
and obstruction to the free flow of commerce prevented.
Mere pretended bargaining will not suffice; neither must
the mind be hermetically sealed against the thought of
entering into an agreement. To do less that is required by
the standards of good faith and conduct is a refusal to
bargain collectively and violates the spirit and intent of
the Act.

4.2 When Can Bargaining in Bad Faith Occur?

Bargaining in bad faith is considered ULP under Art,
248(g). But if one will be charged with bargaining in bad
faith, the charge should be raised while the bargaining is
in progress. When the bargaining is finished and the CBA
has been executed voluntarily by the parties, a charge of
bargaining in bad faith is too late and untenable.

With the execution of the CBA, bad faith bargaining can no
longer be imputed upon any of the parties thereto. All
provisions in the CBA are supposed to have been jointly and
voluntarily incorporated therein by the parties. This is not a
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case where private respondent exhibited an indifferent attitude
towards collective bargaining because the negotiations were
not the unilateral activity of petitioner union. The CBA is proof
enough that private respondent exerted "reasonable effort at
good faith bargaining."

The unions proposal, not being part of the signed contract,
cannot serve as basis of holding the management guilty of bad
faith in bargaining or in implementing their contract as signed.

4.3 Instances of Bad Faith: Delay of, or Imposing Time
Limit on, Negotiations

An unwarranted delay in negotiations may be evidence
of bad faith on the part of the employer. However, an
employer has been held not guilty of bad faith for failing
to complete a collective bargaining contract during a 3-
year period, where many conferences had been held
during the period, even though the employer had
insisted on a no-strike clause and had raised wages
during negotiations for the purpose of meeting
competition.

The National Labor Relations Board of the United States
reported that lack of good faith is indicated where the
employer engages in unfair labor practices while
bargaining with the union; where it engages in dilatory
tactics during negotiations; or where it institutes a wage
cut by unilateral action and without consulting the
majority representative.

Nonetheless, the prior adjudication of bad faith on an
earlier occasion is not itself substantial evidence of
present bad faith.

As the Court held in the case of Kiok Loy v. NLRC, 141 SCRA 179,
186 (1986), the company's refusal to make counter-proposal to
the union's proposed CBA is an indication of its bad faith.

4.3a Bad Faith: Surface Bargaining; Shifting Bargaining
Positions; Blue Sky Bargaining

Surface bargaining, which means a sophisticated
pretense in the form of apparent bargaining, does not
satisfy the statutory duty to bargain. The duty is not
discharged by merely meeting together or simply
manifesting a willingness to talk. It requires more than a
willingness to enter upon a sterile discussion of union-
management differences. Collective bargaining is not
simply an occasion for purely formal meetings between
management and labor while each maintains an attitude
of take it or leave it, but presupposes a desire to reach
an ultimate agreement to enter into a collective
bargaining contract. An employers proposals which
could not be offered with any reasonable expectation
that they would be accepted by the union constitute
surface bargaining.

Repeated shifts in position and attitude on the part of an
employer whenever a tentative agreement is reached are
evidence of a refusal to bargain collectively in good faith.
It has also been held that an employer cannot reject a
unions acceptance of the employers counter offer on
the ground that the union had earlier rejected the offer.

Surface bargaining is defined as "going through the motions of
negotiating" without any legal intent to reach an agreement.
The resolution of surface bargaining allegations never presents
an easy issue. The determination of whether a party has
engaged in unlawful surface bargaining is usually a difficult one
because it involves, at bottom, a question of the intent of the
party in question, and usually such intent can only be inferred
from the totality of the challenged partys conduct both at and
away from the bargaining table. It involves the question of
whether an employers conduct demonstrates an unwillingness
to bargain in good faith or is merely hard bargaining. x x x We,
likewise, do not agree that the Union is guilty of ULP for
engaging in blue-sky bargaining or making exaggerated or
unreasonable proposals.

4.3b Bad Faith: Inflexible Demands; Strike Amid
Negotiation

4.3c Bad Faith: Boulwarism; Take-It-or-Leave-It
Bargaining

The new plan was threefold. As negotiations approached, the
Company would use its local management personnel on the
desires of the work force on the type and level of benefits;
these were then translated into specific proposals, whose cost
and effectiveness were researched in order to determine an
attractive bargaining offer within the Company's means; the
Company then attempted to "sell" its proposals to its
employees and the general public through a publicity campaign
in plant newspapers, bulletins, letters, television and radio
announcements and personal contacts. The Company
announced in negotiations that it rejected the usual horse
trading approach to bargaining, with each side eventually
compromising initial unreasonable positions; it advertised its
initial proposals as fair and firm. Though willing to accept
Union suggestions based on factsit might have overlooked, the
Company refused to change its position simply because the
Union disagreed with it.

We have already indicated that one of the central tenets of
"the Boulware approach" is that the "product" or "firm, fair
offer" must be marketed vigorously to the "consumers" or
employees, to convince them that the Company, and not the
Union, is their true representative.

The aim, in a word, was to deal with the Union through the
employees, rather than with the employees through the Union.

4.4 Not Bad Faith to Propose Modifications to the
Expiring CBA

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It is not bad-faith bargaining when a party proposes
modifications to the expiring CBA. The second sentence
of Article 253 explicitly refers to serving a written notice
to terminate or modify the agreement. Modification
may mean addition to, subtraction from, or other ways
of changing the contents or phraseology of contents of
the expiring CBA. It does not connote a one-direction
movement. But whichever way it is proposed to go, the
proposed changes require honest explanation.

What was excluded from the old CBA may be proposed
for inclusion in the forthcoming CBA, or vice-versa.
Negotiation precisely contemplates proposals and
counter-proposals.

4.5 Giving of Information

Part of good-faith bargaining, and a method to expedite
the process, is supplying of information to the other
party, as required by law. It should be recalled that under
Art. 242 one of the rights of a legitimate labor
organization which is certified as the exclusive bargaining
agent, is to ask for and be furnished with the employers
annual audited financial statements, including the
balance sheet and the profit and loss statement. Such
information is crucial in bargaining.

An employer is under a duty, upon request of the
bargaining representative, to provide information
relevant to the issues at the bargaining table. Refusal to
provide relevant information after the same has been
requested constitutes per se violation of the duty to
bargain. Relevant information or data may include
information concerning the employees in the bargaining
unit, such as their names, addresses, and seniority
standing, or concerning the financial status of the
employer, especially where needed to substantiate
claims of inability to pay.

5. FOURTH U.L.P. IN BARGAINING: GROSS VIOLATION
OF THE CONTRACT

At this stage, the negotiations are over; the document
has been signed, sealed, and delivered. Implementation
should follow. But at this stage the collective bargaining
process is not yet over, and the duty to bargain is still
operative because such duty further requires faithful
adherence to the contractual provisions. Violation of the
contract amounts to ULP, if the violation is gross.

6. RATIFICATION BY THE CBU; MANDATORY
REQUIREMENTS

The agreement negotiated by the employees bargaining
agent should be ratified or approved by the majority of
all the workers in the bargaining unit.

The proper ratifying group is not just the majority union
but the majority of all the workers in the bargaining unit
represented in the negotiation.

The ratification and the manner of doing it are
mandatory.

The Implementing Rules require posting of the CBA in
two conspicuous places for five days. In one case, the
CBA was not posted for at least five days in two
conspicuous places in the establishment before
ratification, to enable the workers to clearly inform
themselves of its provisions. Moreover, the CBA
submitted to the MOLE did not carry the sworn
statement of the union secretary, attested by the union
president, that the CBA had been duly posted and
ratified, as required by the Implementing Rules and
Regulations. The court ruled that these requirements
being mandatory, non-compliance therewith rendered
the said CBA ineffective.

6.1 Invalid Ratification

6.2 When Ratification Not Needed

Ratification of the CBA by the employees in the
bargaining unit is not needed when the CBA is a product
of an arbitral award by appropriate government
authority or by a voluntary arbitrator. The arbitral award
may result from voluntary arbitration under Art.262 or
from the secretarys assumption of jurisdiction or
certification of the dispute to the NLRC, under Art.
263(g).

In any of those situations the CBA still needs to be posted
in two conspicuous places in the workplace, but the
posting is for the information of, and not ratification by,
the employees affected. Moreover, the CBA has to be
registered with the DOLE regional office.

To require ratification of the CBA in case of arbitral
awards will be inconsistent with the nature of arbitration
as a dispute-settlement device.

The preceding comment, however, does not mean that
the arbitral award is beyond question. Certiorari on
proper grounds is available.

6.3 Ratified but Unsigned

Lack of the purely ministerial act of signing the formal
contract did not obviate the fact that there was a binding
contract.

6.4 Unratified but Implemented
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88 | P L A T O N

The parties to a collective agreement are required to furnish
copies to the appropriate Regional Office with accompanying
proof of ratification by the majority of all the workers in the
bargaining unit. This was not done in the case at bar. But we do
not declare the CBA invalid or void considering that the
employees have enjoyed benefits from it. They cannot receive
benefits under provisions favorable to them and later insist that
the CBA is void simply because other provisions turn out not to
the liking of certain employees. It is iniquitous to receive
benefits from a CBA and later on disclaim its validity.

7. EXECUTION OF CONTRACT

A party to a collective bargaining may be required to sign
a contract where the agreement has been reached by the
parties and only one partys refusal to execute a contract
is preventing its being carried into effect. Such refusal is
an unfair labor practice

7.1 Unwritten or Unsigned Agreement

American courts have held that a collective bargaining
agreement is valid though not reduced to writing or
signed, if neither party requests a written instrument.

7.2 Effect of Signing on Other Disputes

8. REGISTRATION OF C.B.A.

The collective agreement, having been properly ratified,
should be registered with the DOLE Regional Office
where the bargaining union is registered or where it
principally operates. Art. 231 requires the registration
within thirty (3) calendar days from execution of the
agreement. Multi-employer collective bargaining
agreements shall be filed with the Bureau.

It is believed that failure to register the CBA does not
make it invalid or unenforceable. Its non-registration,
however, renders the contract-bar rule inoperative.

8.1 Requirements for Registration

Section 2. Requirements for registration. - The application for
CBA registration shall be accompanied by the original and two
(2) duplicate copies of the following documents which must be
certified under oath by the representative(s) of the employer(s)
and labor union(s) concerned

(a) the collective bargaining agreement;

(b) a statement that the collective bargaining agreement was
posted in at least two (2) conspicuous places in the
establishment or establishments concerned for at least five (5)
days before its ratification; and

(c) a statement that the collective bargaining agreement was
ratified by the majority of the employees in the bargaining unit
of the employer or employers concerned.

No other document shall be required in the registration of
collective bargaining agreements

The application may be denied if the supporting
documents are incomplete or not verified under oath.
The denial, if by the Regional office, is appealable to the
Bureau within ten (10) days or to the Secretary if the
denial is by the Bureau.

9. AUTOMATIC RENEWAL OF CBA

The parties shall continue the CBA in full force and
effect until they reach a new agreement.

It is clear from the above provision of law that until a new
Collective Bargaining Agreement has been executed by and
between the parties, they are duty-bound to keep the status
quo and to continue in full force and effect the terms and
conditions of the existing agreement. The law does not provide
for any exception nor qualification as to which of the economic
provisions of the existing agreement are to retain force and
effect, therefore, it must be understood as encompassing all
the terms and conditions in the said agreement.
________

Article 253-A. Terms of a collective bargaining
agreement. Any Collective Bargaining Agreement that
the parties may enter into shall, insofar as the
representation aspect is concerned, be for a term of five
(5) years. No petition questioning the majority status of
the incumbent bargaining agent shall be entertained and
no certification election shall be conducted by the
Department of Labor and Employment outside of the
sixty-day period immediately before the date of expiry of
such five-year term of the Collective Bargaining
Agreement. All other provisions of the Collective
Bargaining Agreement shall be renegotiated not later
than three (3) years after its execution.

Any agreement on such other provisions of the Collective
Bargaining Agreement entered into within six (6) months
from the date of expiry of the term of such other
provisions as fixed in such Collective Bargaining
Agreement, shall retroact to the day immediately
following such date. If any such agreement is entered
into beyond six months, the parties shall agree on the
duration of retroactivity thereof. In case of a deadlock in
the renegotiation of the Collective Bargaining
Agreement, the parties may exercise their rights under
this Code. (As amended by Section 21, Republic Act No.
6715, March 21, 1989).
________

LABOR RELATIONS
89 | P L A T O N
1. DURATION OF A C.B.A.

RA No. 9715 (March 21, 2989) has introduced through
Art. 253-A a significant change in setting the durations or
terms of a CBA at five years for the representation
aspect and not more than three years for all other
provisions. The representation aspect refers to the
identity and majority status of the union that negotiated
the CBA as the exclusive representative of the bargaining
unit. All other provisions: simply refers to the rest of the
CBA, economic as well as non-economic other than
representational.

The conference agreed to make the terms and
conditions or economic provision of the CBA good
only for three years so as to protect the economic gains
of the workers.

Obviously, the framers of the law wanted to maintain industrial
peace and stability by having both management and labor work
harmoniously together without any disturbance. Thus, no
outside union can enter the establishment within five (5) years
and challenge the status of the incumbent union as the
exclusive bargaining agent. Likewise, the terms and conditions
of employment (economic and non-economic) cannot be
questioned by the employers or employees during the period of
effectivity of the CBA. The CBA is a contract between the
parties and the parties must respect the terms and conditions
of the agreement. Notably, the framers of the law did not give a
fixed term as to the effectivity of the terms and conditions of
employment. It can be gleaned from their discussions that it
was left to the parties to fix the period.

The issue as to the term of the non-representation provisions of
the CBA need not belabored especially when we take note of
the Memorandum of the Secretary of Labor dated February 24,
1994. In said memorandum, the Secretary of Labor had
occasion to clarify the term of the renegotiated terms of the
CBA vis-a-vis the term of the bargaining agent, to wit:

As a matter of policy the parties are encourages (sic) to enter
into a renegotiated CBA with a term which would coincide (sic)
with the aforesaid five (5) year term of the bargaining
representative.

In the event however, that the parties, by mutual agreement,
enter into a renegotiated contract with a term of three (3)
years or one which does not coincide with the said 5-year term,
and said agreement is ratified by majority of the members in
the bargaining unit, the subject contract is valid and legal and
therefore, binds the contracting parties. The same will however
not adversely affect the right of another union to challenge the
majority status of the incumbent bargaining agent within sixty
(60) days before the lapse of the original five (5) year term of
the CBA.

2. EFFECTIVITY AND RETROACTIVITY OF A C.B.A.

If the CBA is the very first for the bargaining unit, the
Code does not state any rule on the CBAs effectivity
date. The parties have to decide it for themselves. But if
the ensuing CBA is renewal, modification or
renegotiation of an expiring one, the Code offers a
formula for the effectivity date. Article 253-A provides
that the ensuing agreement, if entered into within six (6)
months from expiry of the old one, shall retroact to the
date following such expiry date; thus, if the CBA expired
on December 31 and the new one is concluded on, say,
March 31, its effectivity date is January 1. If, on the other
hand, the new agreement is concluded after June 30,
then the matter of retroaction and the possible
retroactive date are left to the parties.

When, precisely, is the date an agreement is concluded
or entered into?

The determining point is the date the parties agreed, not the
date they signed. Art. 253-A refers merely to an "agreement"
which, according to Black's Law Dictionary is "a coming
together of minds; the coming together in accord of two minds
on a given proposition." This is similar to Art. 1305 of the Civil
Code's definition of "contract" as "a meeting of minds between
two persons." The two terms, "agreement" and "contract," are
indeed similar, although the former is broader than the latter
because an agreement may not have all the elements of a
contract. As in the case of contracts, however, agreements may
be oral or written. Hence, even without any written evidence of
the Collective Bargaining Agreement made by the parties, a
valid agreement existed in this case from the moment the
minds of the parties met on all matters they set out to discuss,
as provided under Art. 1315 of the Civil Code.

2.1 Effectivity of CBA Concluded After Six Months from
Expiration of Old CBA

Significantly, the law does not specifically cover the
situation where six months have elapsed but the parties
have reached no agreement with respect to effectivity. In
this eventuality, we hold that any provision of law should
then apply, for the law abhors a vacuum.

One such provision is the principle of hold over, i.e., that in the
absence of a new CBA, the parties must maintain the status quo
and must continue in full force and effect the terms and
conditions of the existing agreement until a new agreement is
reached. In this manner, the law prevents the existence of a
gap in the relationship between the collective bargaining
parties. Another legal principle that should apply is that in the
absence of an agreement between the parties, then, an
arbitrated CBA takes on the nature of any judicial or quasi-
judicial award; it operates and may be executed only
prospectively unless there are legal justifications for its
retroactive application.

3. EXTENSION OF EFFECTIVITY OF C.B.A., WHEN VALID

LABOR RELATIONS
90 | P L A T O N
3.1 Ten-Year Suspension of CBA
________

Article 254. Injunction prohibited. No temporary or
permanent injunction or restraining order in any case
involving or growing out of labor disputes shall be issued
by any court or other entity, except as otherwise
provided in Articles 218 and 264 of this Code. (As
amended by Batas Pambansa Bilang 227, June 1, 1982).
________

1. NO-INJUNCTION POLICY

An injunction may require or restrain the doing of an act.

Article 254 announces the policy that labor disputes are
generally not subject to injunction. If the rule were
otherwise, it would contradict the declared policy, under
Article 211(a), to promote and emphasize the primacy
of free collective bargaining and negotiations, including
voluntary arbitration, mediation and conciliation, as
modes of settling labor or industrial disputes.

The policy, basically, is freedom at the workplace. The
law, true to the tenets of free enterprise system, allows
management and labor to fashion the contents and
incidents of their relationship. If there is dispute between
the parties, the responsibility to solve it devolves upon
them primarily, not upon the government. Government
intervention is the exception rather than the rule. This
anti-injunction policy applies even as regards wage-fixing
by the wage commission or regional wage boards.

Moreover, any injunctive order in non-national interest
disputes can be directed only against the illegal acts
being committed in connection with the labor dispute; it
cannot be directed against the dispute itself.

There is no power the exercise of which is more delicate which
requires grater caution, deliberation, and sound discretion, or
(which is) more dangerous in a doubtful case than the issuing of
an injunction; it is the strong arm of equity that never ought to
be extended unless to cases of great injury, where courts of law
cannot afford an adequate or commensurate remedy in
damages. The right must be clear, the injury impending or
threatened, so as to be averted only by protection preventive
process of injunction.

1.1 Reason of the No-Injunction Policy

The labor injunction is an employers most effective
remedy in labor dispute. However narrow its scope and
form, the issuance of an injunction for any purpose in a
labor dispute will generally tip the scales of the
controversy. The issuance of an injunction in the early
phases of a strike can critically sway the balance of the
economic struggle against the union. Enforced by the
courts contempt powers, even a preliminary injunction
is an effectual strike-breaking weapon because so much
time ordinarily elapses between the issuance of a
preliminary injunction and the time when a final decree
can be reviewed on appeal.

1.2 Injunction Issued by Regular Court, When Proper

Regular courts are without authority to issue injunction
orders in cases involving or originating from labor
disputes even if the complaint was filed by non-striking
employees and the employer was also made a
respondent to the action or even if the complainant was
a customer of the strike-bound employer or a sister
company of the strike-bound employer, whose premises
were picketed by the strikers.

The court may issue an injunction, whether temporary or
permanent, as provided in said section of Republic Act 875,
only in a case involving or growing out of a labor dispute.
________

Article 255. Exclusive bargaining representation and
workers participation in policy and decision-making.
The labor organization designated or selected by the
majority of the employees in an appropriate collective
bargaining unit shall be the exclusive representative of
the employees in such unit for the purpose of collective
bargaining. However, an individual employee or group of
employees shall have the right at any time to present
grievances to their employer.

Any provision of law to the contrary notwithstanding,
workers shall have the right, subject to such rules and
regulations as the Secretary of Labor and Employment
may promulgate, to participate in policy and decision-
making processes of the establishment where they are
employed insofar as said processes will directly affect
their rights, benefits and welfare. For this purpose,
workers and employers may form labor-management
councils: Provided, That the representatives of the
workers in such labor-management councils shall be
elected by at least the majority of all employees in said
establishment. (As amended by Section 22, Republic Act
No. 6715, March 21, 1989).
________

1. WORKERS PARTICIPATORY RIGHT: ITS
CONSTITUTIONAL MEANING

The crucial question is: what is the meaning or extent of
the workers right to participate in policy and decision-
making?

LABOR RELATIONS
91 | P L A T O N
Enlightening in this regard are the deliberations of the
1986 Constitutional Commission. They reveal that the
intention was to refer to participation in grievance
procedures and voluntary modes of settling disputes and
not to formulation of corporate programs or policies.

There are three levels in which employees could
influence management in their decision-making, and one
would be at the corporate level. This would refer to
strategic policies pertaining to the mergers, acquisitions,
pricing and marketing policies, disposition of profits and
the like. The second level would be the plant or
department level. It is here where administrative
decisions are made. Decisions made in this level may
refer to hiring, firing, and promotion of employees, cost
and quality control, resource allocations, achievement of
target quotas, etc. And the third will be the shop-floor
level. It is here where the so-called operating decisions
are made. Decisions made in this level usually refer to
scheduling of work, safety regulations, work methods,
training of new employees. So these are the different
levels in which we hope there would be this democratic
participation of workers in vital issues that affect both
management and the workers.

1.1 Employees Participation in Formulating the Code of
Discipline

Indeed, it was only on March 2, 1989, with the approval of
Republic Act No. 6715, amending Article 211 of the Labor Code,
that the law explicitly considered it a State policy "(t)o ensure
the participation of workers in decision and policy-making
processes affecting the rights, duties and welfare." However,
even in the absence of said clear provision of law, the exercise
of management prerogatives was never considered boundless.

Verily, a line must be drawn between management
prerogatives regarding business operations per se and those
which affect the rights of the employees. In treating the latter,
management should see to it that its employees are at least
properly informed of its decisions or modes action.

2. WORKERS PARTICIPATION AS THE REAL OBJECTIVE;
THE LMC

Article 255 deals with the crucial concept of employee
participation. The law, while promoting collective
bargaining, really aims at employee participation in
policy and decision-making. Collective Bargaining is just
one of the forms of employee participation. Despite so
much interest in and promotion of collective bargaining,
it is incorrect to say that the device which secures
industrial democracy is collective bargaining and no
other. And it is equally misleading to say that collective
bargaining is the end-goal of employee representation.
Rather, the real aim is employee participation in
whatever form it may appearbargaining or no
bargaining, union or no union.

This is why Art. 255, second sentence, reserves the right
of an individual employee or group of employees
(unionized or ununionized, or inside or outside a union)
to present grievances to their employer at any time.
Effectively voicing ones grievance is reserved and
hallowed by law, with or without collective bargaining.

But individual representation in dealing or bargaining
with the employer is weak. For this reason the law
provides another forumthe labor-management council
aside from or instead of a union. An LMC is versatile. It
can exist where there is no union or co-exist with a
union. One thing it cannot and must not do is to replace
a union. While a labor union is hamstrung by such legal
prescriptions as formal registration, limited bargaining
unit, majority status, mandatory and non-mandatory
subjects, etc., an LMC need not be held back by any of
these. It can represent employees across the enterprise,
present grievances regardless of the grievants rank, and
proffer proposals unhindered by formalities. It can also
handle projects and programs whoever is the proponent,
form committees for myriad purposes, instill discipline
and improve productivity.

The LMC, in short, can deal with the employer on matters
affecting the employees rights, benefits and welfare.
Dealing with the employer, we have seen, is broader,
freer, and (from the employers viewpoint) less
threatening method than collective bargaining.

2.1 Departments Promotion of LMC and Other Councils

Section 1. Creation of labor-management and other councils. -
The Department shall promote the formation of labor-
management councils in organized and unorganized
establishments to enable the workers to participate in policy
and decision-making processes in the establishment, insofar as
said processes will directly affect their rights, benefits and
welfare, except those which are covered by collective
bargaining agreements or are traditional areas of bargaining.

3. INDIVIDUAL GRIEVANCE

As briefly indicated above, the presence of an
employees organization,--a union, an LMC or other
forumdoes not replace the individual employees right
to pursue grievances. Each employee retains the right to
deal with his or her employer, and vice-versa. The labor
organization is a representative of the collective
employees, but this fact does not mean that an
employee can act only through the representative. For
these reasons, the law (rt. 255) explicitly preserves and
respects the right of an individual employee or any group
LABOR RELATIONS
92 | P L A T O N
of employees to directly present grievances to their
employers at any time. Even when under investigation,
an employee can choose to handle personally his
defense, unassisted by any representative (Art. 277[b]).
The second sentence of Art. 255 is meant to be an
exception to the exclusiveness of the representative role
of the labor organization. Such individual right cannot be
taken away even by a unions constitution and by-laws.

American jurisprudence holds that notwithstanding a
unions obligation as exclusive bargaining representative
to process the grievances of all bargaining unit
employees, individual employees may at any time
present grievances directly to the employer for
adjustment without the intervention of the bargaining
representative, and without subjecting the employer to
liability for refusing to bargain with the union. However,
the adjustment of the grievances must be consistent with
the terms of the current collective bargaining contract or
agreement. Moreover, the bargaining representative
must be given the opportunity to be present at the
meeting between the employer and employee.

4. COLLECTIVE BARGAINING UNIT (CBU) DEFINED

At the enterprise level there are three democratic
devices, statutorily embedded, to advance the cause of
industrial peace, namely: airing of grievance even by an
individual employee directly to the employer anytime;
participation in policy and decision-making by
employees, whether unionized or not; and collective
bargaining with the employer by unionized employees.

The collective bargaining that the law envisions occurs
between the employer and the employees comprised in
an appropriate collective bargaining unit (CBU)
represented by a union. As initially explained in Art. 234,
the CBU is that group of jobs and jobholders
represented by the recognized or certified union when it
bargains with the employer. The group may comprise
all the supervisors or, separately, all the rank-and-file
population in the company. Or it may be less than all of
these two categories, although the law prefers to have
only one grouping per category in one enterprise
because the more solid the unit, the stronger its
bargaining capacity. But if a single unit (only one for all
supervisors or only one for all rank-and-file) is not
feasible, the law allows subgroups as bargaining units,
provided only that each sub-group is appropriate. It is
appropriate if its members share substantially common
concerns and interests.

As defined in D.O. No. 40-03 which is now the revised
Book V of the Rules Implementing the Labor Code,
bargaining unit refers to a group of employees sharing
mutual interests within a given employer unit, comprised
of all or less than all of the entire body of employees in
the employer unit or any specific occupational or
geographical grouping within such employer unit.

Within one unit there may be one or more unions. The
bargaining unit therefore is not the same as, and usually
a bigger group than, a union. But only one union should
represent the whole CBU in bargaining with the
employer. The chosen union is called the bargaining
agent, its principal being the CBU members themselves.

The bargaining union has to be the majority union, the
one where majority of the CBU members belong.

Representative union, bargaining union, majority
union, bargaining agent, and bargaining
representative are one and the same. It refers to the
union that represents the CBU in bargaining or dealing
with the employer.

5. APPROPRIATENESS OF BARGAINING UNIT; FACTORS
CONSIDERED

The determination of what constitutes a proper bargaining
unitlies primarily in the discretion of the Bureau, since no
individual factor is given by law decisive weight. But while the
determination of the appropriate collective bargaining unit
(CBU) is a primary function of the Bureau, it is subject to the
legal requirement that proper consideration should be given to
all legally relevant factors.

The basic test of an asserted bargaining unit's acceptability is
whether or not it is fundamentally the combination which will
best assure to all employees the exercise of their collective
bargaining rights. Industrial experience indicates that the most
efficacious bargaining unit is one which is comprised of
constituents enjoying a community of interest. This community
of interest is reflected in groups having substantial similarity of
work and duties or similarity of compensation and working
conditions.

In making judgments about community of interest in
these different settings, the Board will look to such
factors as: (1) similarity in the scale and manner of
determining earnings; (2) similarity in employment
benefits, hours of work and other terms and conditions
of employment; (3) similarity in the kinds of work
performed; (4) similarity in the qualifications, skills and
training of the employees; (5) frequency of contact or
interchange among the employees; (6) geographic
proximity; (7) continuity or integration of production
processes; (8) common supervision and determination of
labor-relations policy; (9) history of collective bargaining;
(10) desires of the affected employees; or (11) extent of
union organization.

LABOR RELATIONS
93 | P L A T O N
Geographical location can be completely disregarded if
the communal or mutual interests of the employees are
not sacrificed.

5.1 Bargaining History Not Decisive Factor

The basic test of an asserted bargaining unit's acceptability is
whether or not it is fundamentally the combination which will
best assure to all employees the exercise of their collective
bargaining rights.

5.2 Exclusion of Confidential Employees

By the very nature of their functions, they assist and act in a
confidential capacity to, or have access to confidential matters
of, persons who exercise managerial functions in the field of
labor relations. As such, the rationale behind the ineligibility of
managerial employees to form, assist or join a labor union
equally applies to them.

5.3 Temporary or Part-Time Employees

The NLRB has been upheld in excluding temporary
employees from bargaining units of workers in certain
jobs. In determining whether temporary or part-time
employees are sufficiently identified with the regular
employees, so as to be properly included in the
bargaining unit, one of the important factors considered
by the NLRB is the reasonable likelihood that the
temporary or part-time employees will eventually
become adequately identified in employment with the
other members of the bargaining unit.

5.4 Seasonal Employees

The full-time seasonal employees who have a reasonable
expectation of substantial seasonal employment from
year to year have been held properly included in the unit,
but part-time seasonal employees who receive none of
the fringe benefits enjoyed by full-time employees have
insufficient common interest with the full-time
employees to be included in the same bargaining unit.

5.5 Probationary Employees

The fact that an employee is given a classification such as
beginner, trainee or probationary employee, and the fact
that contemplation of permanent tenure is subject to
satisfactory completion of an initial trial period, are
insufficient to warrant such employees exclusion from a
bargaining unit. Moreover, the eligibility of probationary
employees does not turn on the proportion of such
employees who, willingly or not, fail to continue to work
for the employer throughout the trial period.

6. REFERENDUM WHERE INTERESTS ARE DISSIMILAR

The decision then of the Executive Labor Arbiter in
merely directing the holding of a referendum to
determine the will of the service engineers, sales
representatives as to their inclusion or exclusion in the
bargaining unit is the most appropriate procedure that
conforms with their right to form, assist or join a labor
union or organization.

6.1 Desire of the Employees; The Globe Doctrine

The desires of the employees are relevant to the
determination of the appropriate bargaining unit. The
relevancy of the wishes of employees concerning their
inclusion or exclusion from a proposed bargaining unit is
inherent in the basic right to self organization. While the
desires of the employees with respect to their inclusion
in a bargaining unit is not controlling, it is a factor which
would be taken into consideration in reaching a decision.

7. SINGLE OR EMPLOYER UNIT IS FAVORED

It has been the policy of the Bureau of Labor Relations to
encourage the formation of an employer unit unless
circumstances otherwise require. In other words, one
employer enterprise constitutes only one bargaining unit.
The more solid the employees are, the stronger is their
bargaining capacity.

The proliferation of unions in an employer unit is
discouraged as a matter of policy unless there are
compelling reasons which would deny a certain class of
employees the right to self-organization for purposes of
collective bargaining.

Single plant units are presumed to be appropriate for
purposes of collective bargaining.

Instead of forming another bargaining unit, the law requires
them to be members of the existing one. The ends of unionism
are better served if all the rank-and-file employees with
substantially the same interests and who invoke their right to
self-organization are part of a single unit so that they can deal
with their employer with just one and yet potent voice. The
employees' bargaining power with management is
strengthened thereby.

7.1 Exception to One-unit Policy

The one unit-one company rule is not without
exception. The exclusion of the subject employees from
the rank-and-file bargaining unit and the CBA is definitely
a compelling reason, for it completely deprived them
of the chance to bargain collectively with petitioner and
are thus left with no recourse but to group themselves
into a separate and distinct bargaining unit and form
their own organization.
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The usual exception, of course, is where the employer unit has
to give way to the other units like the craft unit, plant unit, or a
subdivision thereof; the recognition of these exceptions takes
into account the policy to assure employees of the fullest
freedom in exercising their rights. Otherwise stated, the one
company-one union policy must yield to the right of the
employees to form unions or associations for purposes not
contrary to law, to self-organization and to enter into collective
bargaining negotiations, among others, which the Constitution
guarantees.

8. TWO COMPANIES WITH RELATED BUSINESSES

Two corporations cannot be treated as a single
bargaining unit even if their businesses are related.

8.1 Subsidiaries and Spun-Off Corporations

Subsidiaries or corporations formed out of former
divisions of a mother company following a bona fide
reorganization may constitute separate bargaining units.

Moreover, in determining an appropriate bargaining unit, the
test of grouping is mutuality or commonality of interests. The
employees sought to be represented by the collective
bargaining agent must have substantial mutual interests in
terms of employment and working conditions as evinced by the
type of work they performed. Considering the spin-offs, the
companies would consequently have their respective and
distinctive concerns in terms of the nature of work, wages,
hours of work and other conditions of employment. Interests of
employees in the different companies perforce differ. SMC is
engaged in the business of the beer manufacturing. Magnolia is
involved in the manufacturing and processing of dairy products
while SMFI is involved in the production of feeds and the
processing of chicken. The nature of their products and scales
of business may require different skills which must necessarily
be commensurated by different compensation packages. The
different companies may have different volumes of work and
different working conditions. For such reason, the employees of
the different companies see the need to group themselves
together and organize themselves into distinctive and different
groups. It would then be best to have separate bargaining units
for the different companies where the employees can bargain
separately according to their needs and according to their own
working conditions.

9. SUMMATION OF SIGNIFICANCE

It is helpful to reiterate that the bargaining unit is not the
same as the union; in fact, there may be several unions
(majority and minority) in one bargaining unit.
Determining the scope or membership of the
bargaining unit is significant and far-reaching because it
leads to the determination also of: (1) the employees
who can vote in the certification election; (2) the
employees to be represented in bargaining with the
employer; and (3) the employees who will be covered by
the resulting CBA.

Distinguishing the CBU from the union is important
because

1. in a CE the voters are the CBU, whether union or non-
union members;

2. in CBA ratification the voters are the unit, not just the
union members;

3. in strike voting, the voters are the members of the
union, not all of the unit.
________

Article 256. Representation Issue in Organized
Establishments. - In organized establishments, when a
verified petition questioning the majority status of the
incumbent bargaining agent is filed by any legitimate
labor organization including a national union or
federation which has already issued a charter certificate
to its local chapter participating in the certification
election or a local chapter which has been issued a
charter certificate by the national union or federation
before the Department of Labor and Employment within
the sixty (60)-day period before the expiration of the
collective bargaining agreement, the Med-Arbiter shall
automatically order an election by secret ballot when the
verified petition is supported by the written consent of at
least twenty-five percent (25%) of all the employees in
the bargaining unit to ascertain the will of the employees
in the appropriate bargaining unit. To have a valid
election, at least a majority of all eligible voters in the
unit must have cast their votes. The labor union receiving
the majority of the valid votes cast shall be certified as
the exclusive bargaining agent of all the workers in the
unit. When an election which provides for three or more
choices results in no choice receiving a majority of the
valid votes cast, a run-off election shall be conducted
between the labor unions receiving the two highest
number of votes: Provided, That the total number of
votes for all contending unions is at least fifty percent
(50%) of the number of votes cast. In cases where the
petition was filed by a national union or federation, it
shall not be required to disclose the names of the local
chapters officers and members.

At the expiration of the freedom period, the employer
shall continue to recognize the majority status of the
incumbent bargaining agent where no petition for
certification election is filed. (As amended by Section 23,
Republic Act No. 6715, March 21, 1989 and Section 10,
Republic Act No. 9481 which lapsed into law on May 25,
2007 and became effective on June 14, 2007).
________
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Article 257. Petitions in Unorganized Establishments. - In
any establishment where there is no certified bargaining
agent, a certification election shall automatically be
conducted by the Med-Arbiter upon the filing of a
petition by any legitimate labor organization, including a
national union or federation which has already issued a
charter certificate to its local/chapter participating in the
certification election or a local/chapter which has been
issued a charter certificate by the national union or
federation. In cases where the petition was filed by a
national union or federation, it shall not be required to
disclose the names of the local chapters officers and
members. (As amended by Section 24, Republic Act No.
6715, March 21, 1989 and Section 11, Republic Act No.
9481 which lapsed into law on May 25, 2007 and became
effective on June 14, 2007).
________

Article 258. When an employer may file petition. When
requested to bargain collectively, an employer may
petition the Bureau for an election. If there is no existing
certified collective bargaining agreement in the unit, the
Bureau shall, after hearing, order a certification election.

All certification cases shall be decided within twenty (20)
working days.

The Bureau shall conduct a certification election within
twenty (20) days in accordance with the rules and
regulations prescribed by the Secretary of Labor.
________

Article 258-A. Employer as Bystander. - In all cases,
whether the petition for certification election is filed by
an employer or a legitimate labor organization, the
employer shall not be considered a party thereto with a
concomitant right to oppose a petition for certification
election. The employers participation in such
proceedings shall be limited to:

(1) being notified or informed of petitions of such nature;
and

(2) submitting the list of employees during the pre-
election conference should the Med-Arbiter act favorably
on the petition. (As amended by Section 12, Republic Act
No. 9481 which lapsed into law on May 25, 2007 and
became effective on June 14, 2007).
________

Article 259. Appeal from certification election orders.
Any party to an election may appeal the order or results
of the election as determined by the Med-Arbiter directly
to the Secretary of Labor and Employment on the ground
that the rules and regulations or parts thereof
established by the Secretary of Labor and Employment
for the conduct of the election have been violated. Such
appeal shall be decided within fifteen (15) calendar days.
(As amended by Section 25, Republic Act No. 6715,
March 21, 1989).
________

1. DETERMINING THE BARGAINING UNION: OVERVIEW
OF THE METHODS

To bargain with the employer, the employees in the
collective bargaining unit (CBU) can be represented by
one and only one union which has to be a legitimate
labor organization duly designated or selected by the
employees in the CBU.

Under the Code a bargaining representative is defined
as a legitimate labor organization or any officer or agent
of such organization whether or not employed by the
employer. The Implementing Rules, however, as
amended by D.O. No. 40-03 drops the officer or agent
as it states: Exclusive bargaining representative means
any legitimate labor union duly recognized or certified as
the sole and exclusive bargaining representative or agent
of all the employees in a bargaining unit.

The selection of such bargaining agent may take place in
an organized or an unorganized establishment.
Organized establishment refers to an enterprise where
there exists a recognized or certified sole and exclusive
bargaining agent. The employer company is
unorganized where no union has yet been duly
recognized or certified as bargaining representative. Art.
256 speaks of an organized firm; Art. 257, of the
unorganized.

Whether the proceedings take place in an organized or
an unorganized bargaining unit, and whether the
proceedings are called consent election or certification
election, the objective is the same, namely, to identify
the union that will represent the employees in bargaining
with the employer. Until this representation dispute is
resolved, no CBA can be entered into.

In an unorganized establishment, the employer may
voluntarily recognize the bargaining agent. If there are
obstacles to this, the petition to hold an election may be
filed anytime by any legitimate labor organization (LLO),
except within 12 months from a previous CE, run-off, or
consent election.

In an organized establishment, on the other hand,
voluntary recognition is not possible. A petition to hold a
CE has to be filed within the freedom period which
means the last sixty (60) days of the fifth year of the
expiring CBA; in other words, the contest between
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96 | P L A T O N
unions comes at intervals of roughly four years and ten
months. The petition may be filed by any LLO, but the
petition must have the written support of at least
twenty-five percent (25%) of the employees in the
bargaining unit. The 25% initial support indicates that the
petitioner has a fair chance of winning and that the
petition is not just a nuisance.

Conceivably but rarely an employer may also file a
petition for a CE.

The election is conducted under the supervision and
control of DOLE officials. It ends up with a formal and
official statement of results, certifying which union won,
if any. Hence, the election is appropriately called
certification election.

Where one casting of votes is not decisive enough to
elect a union, the election officials may require a run-off
election if certain other conditions exist, as explained
below.

But a certification election, a run-off election, or a
consent election is needed only when two or more
unions are vying for the office of exclusive bargaining
representative (EBR). Where there is but one union in the
bargaining unit and there is ample proof that that union
carries the majority of the employees, the law allows the
employer to voluntarily recognize such union. Voluntary
recognition does away with the more tedious electoral
contest between unions.

There are, therefore, three methods to determine the
bargaining union: (1) voluntary recognition; (2)
certification election with or without run-off; and (3)
consent election.

2. FIRST METHOD: VOLUNTARY RECOGNITION (V.R.)

The employers voluntary recognition of the employees
union significantly facilitates the bargaining process. The
employees, especially the union leaders and organizers,
rejoice when they are able to convince the employer to
voluntarily recognize and subsequently bargain with their
union. But VR requires three concurrent conditions.

First, voluntary recognition is possible only in an
unorganized establishment. In an organized setting the
employer cannot voluntarily recognized any new union
because the law (Art. 256) requires him to continue
recognizing and dealing with the incumbent union as
long as it has not been properly replaced by another
union.

Second, only one union is asking for recognition; if there
are two or more unions asking to be recognized the
employer cannot recognize any of them; the rivalry must
be resolved through an election;

Third, the union voluntarily recognized should be the
majority union as indicated by the fact that members of
the bargaining unit did not object to the projected
recognition. If no objection is raised, the recognition will
proceed, the DOLE will be informed and CBA negotiation
will commence. If objection is raised, the recognition is
barred, and a certification election or consent election
will have to take place.

2.1 VR Under D.O. No. 40-03

Section 1. When and where to file. - In unorganized
establishments with only one legitimate labor organization, the
employer may voluntarily recognize the representation status
of such a union. Within thirty (30) days from such recognition,
the employer and union shall submit a notice of voluntary
recognition with the Regional Office which issued the
recognized labor union's certificate of registration or certificate
of creation of a chartered local.

Section 2. Requirements for voluntary recognition. - The notice
of voluntary recognition shall be accompanied by the original
copy and two (2) duplicate copies of the following documents:

(a) a joint statement under oath of voluntary recognition
attesting to the fact of voluntary recognition;

(b) certificate of posting of the joint statement of voluntary
recognition for fifteen (15) consecutive days in at least two (2)
conspicuous places in the establishment or bargaining unit
where the union seeks to operate;

(c) the approximate number of employees in the bargaining
unit, accompanied by the names of those who support the
voluntary recognition comprising at least a majority of the
members of the bargaining unit; and

(d) a statement that the labor union is the only legitimate labor
organization operating within the bargaining unit.

All accompanying documents of the notice for voluntary
recognition shall be certified under oath by the employer
representative and president of the recognized labor union.

Section 3. Action on the Notice. - Where the notice of voluntary
recognition is sufficient in form, number and substance and
where there is no other registered labor union operating within
the bargaining unit concerned, the Regional Office, through the
Labor Relations Division shall, within ten (10) days from receipt
of the notice, record the fact of voluntary recognition in its
roster of legitimate labor unions and notify the labor union
concerned.

Where the notice of voluntary recognition is insufficient in
form, number and substance, the Regional Office shall, within
the same period, notify the labor union of its findings and
advise it to comply with the necessary requirements. Where
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97 | P L A T O N
neither the employer nor the labor union failed to complete the
requirements for voluntary recognition under Section 2 of this
Rule within thirty (30) days from receipt of the advisory, the
Regional Office shall return the notice for voluntary recognition
together with all its accompanying documents without
prejudice to its re-submission.

Section 4. Effect of recording of fact of voluntary recognition. -
From the time of recording of voluntary recognition, the
recognized labor union shall enjoy the rights, privileges and
obligations of an existing bargaining agent of all the employees
in the bargaining unit.

Entry of voluntary recognition shall bar the filing of a petition
for certification election by any labor organization for a period
of one (1) year from the date of entry of voluntary recognition.
Upon expiration of this one-year period, any legitimate labor
organization may file a petition for certification election in the
same bargaining unit represented by the voluntarily recognized
union, unless a collective bargaining agreement between the
employer and voluntarily recognized labor union was executed
and registered with the Regional Office in accordance with Rule
XVII of these Rules.

Simply said, the last paragraph means that the employer
and the union should conclude and register a CBA within
one year from the voluntary recognition, otherwise, the
recognition will lapse and a rival union may petition for a

3. SECOND METHOD: CERTIFICATION ELECTION (C.E.)

Whenever there is doubt as to whether a particular union
represents the majority of the rank-and-file employees, in the
absence of a legal impediment, the holding of a certification
election is the most democratic method of determining the
employees' choice of their bargaining representative. It is the
appropriate means whereby controversies and disputes on
representation may be laid to rest, by the unequivocal vote of
the employees themselves.

Exercising their suffrage through the medium of the secret
ballot, they can select the exclusive bargaining representative
that, emboldened by their confidence and strengthened by
their support shall fight for their rights at the conference table.
That is how union solidarity is achieved and union power is
increased in the free society. Hence, rather than being inhibited
and delayed, the certification election should be given every
encouragement under the law, that the will of the workers may
be discovered and, through their freely chosen representatives,
pursued and realized.

3.1 Fact-Finding

In labor legislation, certification proceedings is not a
litigation in the sense in which the term is ordinarily
understood, but an investigation of non-adversary and
fact finding character. As such, it is not bound by
technical rules of evidence.

The law does not contemplate the holding of a
certification election unless the preliminary inquiry
shows a reasonable doubt as to which of the contending
unions represents a majority, or unless ten per centum of
the laborers demand this election. But these grounds
necessarily depend on the weight of the evidence
adduced by the rival unions, and this weight, in turn,
cannot be determined properly if the right to cross
examination is denied.

Certification proceedings directly involve only two issues:
(a) proper composition and constituency of the
bargaining unit; and (b) veracity of majority membership
claims of the competing unions so as to identify the one
union that will serve as the bargaining representative of
the entire bargaining unit.

But some of the employees may not want to have a
union; hence, No Union is one of the choices
(candidates) named in the ballot. If No Union wins,
the company pr the bargaining unit remains ununionized
for at least 12 months, the period known as the 12-
month bar. After that period, a petition for a CE may be
filed again.

3.1a Certification Election Differentiated from Union
Election

A union election is held pursuant to the union's constitution
and bylaws, and the right to vote in it is enjoyed only by union
members. A union election should be distinguished from a
certification election, which is the process of determining,
through secret ballot, the sole and exclusive bargaining agent of
the employees in the appropriate bargaining unit, for purposes
of collective bargaining. Specifically, the purpose of a
certification election is to ascertain whether or not a majority
of the employees wish to be represented by a labor
organization and, in the affirmative case, by which particular
labor organization.

In a certification election, all employees belonging to the
appropriate bargaining unit can vote. Therefore, a union
member who likewise belongs to the appropriate bargaining
unit is entitled to vote in said election. However, the reverse is
not always true; an employee belonging to the appropriate
bargaining unit but who is not a member of the union cannot
vote in the union election, unless otherwise authorized by the
constitution and bylaws of the union. Verily, union affairs and
elections cannot be decided in a non-union activity.

The winners in a union election become officers and
representatives of the union only. The winner in a
certification election is an entity, a union, which becomes
the representative of the whole bargaining unit that
includes even the members of the defeated unions.

3.2 Direct Certification No Longer Allowed

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98 | P L A T O N
Even in a case where a union has filed a petition for
certification election, the mere fact that there was no
opposition does not warrant a direct certification.

The holding of a certification election at the proper time is not
necessarily a mere formality as there was a compelling legal
reason not to directly and unilaterally certify a union whose
legitimacy is precisely the object of litigation in a pending
cancellation case filed by certain "concerned salesmen," who
also claim majority status.

The direct certification originally allowed under Article 257 of
the Labor Code has apparently been discontinued as a method
of selecting the exclusive bargaining agent of the workers. This
amendment affirms the superiority of the certification election
over the direct certification which is no longer available now
under the change in said provision.

3.3 Who Files Petition for CE

Any legitimate labor organization or any employer, when
requested to bargain collectively while the majority
status of the union is in doubt, may file a petition for
certification election (PCE)

In an unorganized establishment one a petition is filed by
a legitimate labor organization, the Med-arbiter shall
automatically order the conduct of a certification
election. The tenor of Article 257 is one of command, so
such order is not appealable. To make it appealable will
contradict the objective stated in Article 211, to promote
free trade unionism. But the application of Article 257
has to be initiated by a genuine petition from a
legitimate labor organization. Indeed, the law did not
reduce the Med-Arbiter to an automaton which can
instantly be set to impulse by the mere filing of a petition
for certification election. He is still tasked to satisfy
himself that all the conditions of the law are met, and
among the legal requirements is that the petitioning
union must be a legitimate labor organization in good
standing.

In an organized establishment the incumbent bargaining
agent, of course, will not file a PCE because it will not
contest its own incumbency. The filer will most likely be a
union that was defeated in the CE held some five years
before. In any such petition the incumbent union is a
necessary party, a forced intervenor. But even so, it does
not thereby lose its representative status; it remains the
sole bargaining representative until it is replaced by
another. And until so replaced it has the right to retain
the recognition by the employer.

The employer, says Article 258, may file a PCE when it
has been asked to bargain. If this happens, the holding of
the CE becomes mandatory if there is no existing
registered collective bargaining agreement. However,
instead of itself filing a petition, the employer usually lets
the unions interplead to determine who among them will
bargain with the employer.

Other unions which are interested in joining a
certification election may file a motion for intervention.
Such motion is governed by the same rules that apply to
a PCE.

Whether petitioner or intervenor, the union has to be an
LLO.

If the petition for certification election was filed by the
federation which is merely an agent, the petition is deemed to
be filed by the chapter, the principal, which must be a
legitimate labor organization. The chapter cannot merely rely
on the legitimate status of the mother union.

Where the constitution, by-laws and the list of members who
supposedly ratified the same were not attested to by the union
president, and the constitution and by-laws were not verified
under oath, the local union has no personality to file a petition
for certification election it not being a legitimate labor
organization. The petition should be dismissed.

A union that has no legal personality to file a petition for CE has
no personality either to file a petition-in-intervention.

3.4 Where to File the Petition for CE

A petition for certification election (PCE) shall be filed
with the Regional Office which issued the petitioning
unions certificate of registration or certificate of creation
of chartered local. The petition shall be heard and
resolved by the Med-Arbiter.

Where two or more petitions involving the same
bargaining unit are filed in one Regional Office, the same
shall be automatically consolidated with the Med-Arbiter
who first acquired jurisdiction. Where the petitions are
filed in different Regional Offices, the Regional Office in
which the petitions are first filed shall exclude all others;
in which case, the latter shall indorse the petition to the
former for consolidation.

3.5 When to File the Petition

The proper time to file a petition for CE depends on
whether the CBU has a CBA or not. If it has no CBA , the
petition may be filed anytime outside the 12-month bar.
If it has a CBA, it can be filed only within the last 60 days
of the fifth year of the CBA.

3.6 Action on the Petition: Preliminary Conference

The preliminary conference shall determine the
following:
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99 | P L A T O N

(a) the bargaining unit to be represented;

(b) contending labor unions;

(c) possibility of a consent election;

(d) existence of any of the bars to certification election
under Section3 of D.O. No. 40-03;

(e) such other matters as may be relevant for the final
disposition of the case.

If at the preliminary conference the unions agree to hold
a consent election, then the PCE will no longer be heard
and the unions will instead prepare for the consent
election.

If the unions fail to agree to hold a consent election, the
Med-arbiter proceeds to consider the petition. He may
deny and dismiss, or he may grant, the petition. Denial or
grant of the petition is always appealable to the
Secretary. Never appealable, however, is the approval of
a PCE in an unorganized (ununionized) bargaining unit,
the reason being that the law wants the ununionized
unionized.

3.7 Action on the Petition: Hearings and Pleadings

If the contending unions fail to agree to a consent
election during the preliminary conference, the Med-
arbiter may conduct as many hearings as he may deem
necessary. But the conduct of the hearings cannot
exceed fifteen (15) days from the date of the scheduled
preliminary conference/ hearing. After that time the
petition shall be considered submitted for decision. The
Med-arbiter shall have control of the proceedings.
Postponements or continuances are discouraged.

The failure of any party to appear in the hearing(s) when
notified or to file its pleadings shall be deemed a waiver
of its right to be heard. The Med-arbiter, however, upon
the agreement of the parties for meritorious reasons,
may allow the cancellation of scheduled hearing(s). The
cancellation of any scheduled hearing(s) shall not be
used as a basis for extending the 15-day period within
which to terminate the same.

Within ten (10) days from the date of the last hearing,
the Med-arbiter shall issue a formal order denying or
granting the petition. In organized establishments,
however, no order or decision shall be issued by the
Med-arbiter during the freedom period.

The reason for the last-mentioned rule is that during the
entire 60-day freedom period, up to its last day, the door
should remain open for any union to file a PCE or a
motion for intervention.

3.8 Action on the Petition: Denial; Grounds

The Med-arbiter, after due hearing may dismiss the
petition on any of the following grounds:

(1) Not an LLO

(2) Twelve-month Bar

(3) Negotiation Bar or Deadlock Bar

(4) No 25% Support

(5) Contract Bar; PCE Filed Outside the Freedom Period

The first three grounds are applicable to establishments
with or without a CBA; the last two are pertinent only to
an establishment with a CBA about to expire on its fifth
year.

3.8a Ground 1: Petitioner not an LLO

Excepting Article 258, only a legitimate labor
organization (LLO) can file a petition for certification
election. Thus, if the petitioning union is not listed in the
DOLEs list of LLOs or it has no CBA registered in the
DOLE, these facts raise doubt as to its being an LLO, and
the med-arbiter may dismiss the PCE.

But even if the union is listed as LLO or is a party to a
CBA, its legitimacy may still be questioned in a separate
and independent petition for cancellation to be heard
and decided by the BLR Director or the Regional Director
himself.

Does the filing of a petition to cancel the petitioners
registration cause the suspension or dismissal of the
PCE? No, the mere filing foes not. To serve as a ground
for dismissal of a PCE, the legal personality of the
petitioner should have been revoked or cancelled with
finality.

The filing or pendency of any inter/intra-union dispute and
other related labor relations dispute is not a prejudicial
question to any petition for certification election and shall not
be a ground for the dismissal of a petition for certification
election or suspension of proceedings for certification election.

The justification for this rule is that the employees
opportunity to choose a bargaining agent can easily be
blocked or forestalled by an employer through the simple
expedience of questioning the legitimacy of the
petitioner union.
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Suspension of Proceedings: Company Union Charge

A complaint for unfair labor practice may be considered a
prejudicial question in a proceeding for certification election
when it is charged therein that one or more labor unions
participating in the election are being aided, or are controlled,
by the company or employer. The reason is that the
certification election may lead to the selection of an employer-
dominated or company union as the employees bargaining
representative, and when the court finds that said union is
employer-dominated in the unfair labor practice case, the
union selected would be decertified and the whole election
proceedings would be rendered useless and nugatory.

NONETHELESS, a certification election cannot be stayed
during the pendency of unfair labor practice charge
against a union filed by the employer.

Similarly, certification election may be ordered despite
pendency of a petition to cancel the unions registration
certificate founded on alleged illegal strike by the union.

3.8b Ground 2: The 12-month Bar (certification year bar)

No petition for a CE may be filed within one year from
the date of a valid certification, consent, or run-off
election or from the date of entry of a voluntary
recognition of the union by the employer. Thus, if an
election had been held but not one of the unions won a
PCE may be filed again but only after 12 months. The law
does not want more than one election in a 12-month
period. The same bar applies if No Union won in the
previous election.

On the other hand, if a union has won, such union and
the employer must within 12 months start negotiating a
collective agreement. If they fail to do so, they are
defeating the employees wish to have a CBA; hence, the
union or unions that lost can petition again for a
certification election after 12 months from the last
election so as to replace the unproductive bargaining
agent which, perhaps, is cavorting with the employer.

Ordinarily, a bargaining agent who failed to secure a CBA within
12 months could be suspected as a tool of management and
should deserve to be replaced. But if circumstances show that
the cause of not having concluded a CBA was not the unions
fault, such union should not be blamed, and a CE should not be
authorized even though no CBA has been concluded despite
passage of twelve months. The situation takes the nature of a
deadlock bar.

The 12-month prohibition presupposes that there was an actual
conduct of election i.e. ballots were cast and there was a
counting of votes. In this case, there was no certification
election conducted precisely because the first petition was
dismissed, on the ground of a defective petition which did not
include all the employees who should be properly included in
the collective bargaining unit, the certification year bar does
not apply.

Neither does this bar apply if in fact there was a failure of
election because less than majority of the CBU members
voted. In that case, another PCE may be filed within six
(6) months.

An election held less than a year after an invalid election
is not barred. Also not barred would be a second election
held among a group of employees who had not
participated in the first election and had not been given
the opportunity to be represented as part of the unit in
the first election.

A radical change in the size of a bargaining unit within a
short period of time, raising a question as to the majority
status of the certified representative, may also prompt
the NLRB to entertain a petition for an election during
the certification year.

The one-year rule does not apply to a unit clarification
petition filed during the certification year.

In a CE, the No Union choice won. Within 12 months
from that election the employer voluntarily recognized a
new union and then concluded with it a CBA. Is the 12-
month bar violated? Are the recognition and the CBA
valid?

Excepted from the contract-bar rule are certain types of
contracts which do not foster industrial stability, such as
contracts where the identity of the representative is in doubt.
Any stability derived from such contracts must be subordinated
to the employees' freedom of choice because it does not
establish the kind of industrial peace contemplated by the law.

In other words, the court strongly doubted that the
union voluntarily recognized by the employer was really
the employees choice. Most probably, it was a company
union.

3.8c Ground 3: Negotiation or Deadlock Bar

Neither will a PCE prosper if the negotiation is caught in a
deadlock. The deadlock does not erase that fact that
there is negotiation which is a barrier to holding a
certification election. The parties should be allowed to
try to resolve their deadlock; replacing the negotiating
union will not help.

The Deadlock Bar Rule simply provides that a petition
for certification election can only be entertained if there
is no pending bargaining deadlock submitted to
conciliation or arbitration or had become the subject of a
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valid notice of strike or lockout. The principal purpose is
to ensure stability in the relationship of the workers and
the management.

A "deadlock" is the counteraction of things producing entire
stoppage; there is a deadlock when there is a complete
blocking or stoppage resulting from the action of equal and
opposed forces. The word is synonymous with the word
impasse, which "presupposes reasonable effort at good faith
bargaining which, despite noble intentions, does not conclude
in agreement between the parties."

If the law proscribes the conduct of a certification election
when there is a bargaining deadlock submitted to conciliation
or arbitration, with more reason should it not be conducted if,
despite attempts to bring an employer to the negotiation table
by the "no reasonable effort in good faith" on the employer
certified bargaining agent, there was to bargain collectively.It is
only just and equitable that the circumstances in this case
should be considered as similar in nature to a "bargaining
deadlock" when no certification election could be held.

Deadlock Bar Rule, When Not Applicable; Artificial
Deadlock

The deadlock that bars a CE must be genuine and not a
drama. One indicator that it is genuine is the submission
of the deadlock to a third-party conciliator or arbitrator.
Another is that the deadlock is the subject of a valid
notice of strike or lockout. An artificial deadlocka
deadlock prearranged or preserved by collusion of the
employer and the majority unionis deception of the
workers, hence, not a barrier to a petition for a CE.

3.8d Ground 4: 25 Percent Support to PCE

Article 256 requires that the petition for a CE in an
organized establishment which may be filed within the
freedom period should be supported by at least
twenty-five percent (25%) of the bargaining unit.

The support requirement is explained by government
policy to favor the self-organization of workers. In a
company still unorganized the workers should find it easy
to organize, but one a union has established itself as the
employees representative, it should not be so easy for
another union to replace the incumbent. Trying to so will
disturb the peace in the enterprise. To justify the
disturbance, it must appear that a sizeable portion of the
employeesat least 25%desires to have a new union.
Without this minimum support the challenge to the
incumbent looks like a nuisance.

The CBU, Not the Enterprise

If a companys rank-and-file employees are unionized but
the supervisors are not, does the supervisors petition
need the 25% minimum support?

NO, because the company is considered unorganized.
The petition for CE involves only the supervisors, not the
rank-and-file. Insofar as the supervisors are concerned,
the establishment is considered ununionized. Hence
the requirement for 25% support to the petition does not
apply.

In other words, in deciding whether the 25%
requirement is applicable or not, the law considers the
CBU involved, not the whole enterprise. This, again,
makes it easy for workers to unionize, a basic objective of
labor relations law.

Election Despite Lack of 25 Percent Support

Even in the situation where the 25% is needed. This
requirement may be relaxed.

Compliance with the said requirement need not even be
established with absolute certainty. The Court has consistently
ruled that "even conceding that the statutory requirement of
30% of the labor force asking for a certification election had not
been strictly complied with, respondent Director is still
empowered to order that it be held precisely for the purpose of
ascertaining which of the, contending labor organizations shall
be the exclusive collective bargaining agent."

Effect of Withdrawal of Signatories

If a petition for a certification election lacks the 25%
support because a sizeable number of union members
has withdrawn their membership, may the petition still
be granted? Or must it be dismissed? A critical fact to
consider is whether the withdrawal happened before or
after the filing of the petition. If it happened before the
filing, the withdrawal is presumed voluntary and it does
not affect the propriety of the petition; if after, the
withdrawal is deemed involuntary (perhaps pressured by
the employer) and it does not necessarily cause the
dismissal of the petition

The presumption would arise that the withdrawal was procured
through duress, coercion or for valuable consideration. In other
words, the distinction must be that withdrawals made before
the filing of the petition are presumed voluntary unless there is
convincing proof to the contrary, whereas withdrawals made
after the filing of the petition are deemed involuntary.

The reason for such distinction is that if the withdrawal or
retraction is made before the filing of the petition, the names
of employees supporting the petition are supposed to be held
secret to the opposite party. Logically, any such withdrawal or
retraction shows voluntariness in the absence of proof to the
contrary. Moreover, it becomes apparent that such employees
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had not given consent to the filing of the petition, hence the
subscription requirement has not been met.

When the withdrawal or retraction is made after the petition is
filed, the employees who are supporting the petition become
known to the opposite party since their names are attached to
the petition at the time of filing. Therefore, it would not be
unexpected that the opposite party would use foul means for
the subject employees to withdrawal their support.

3.8e Ground 5: PCE Filed Outside the Freedom Period;
the Contract Bar

This means that there exists in the bargaining unit a CBA
still in effect at the time the PCE is filed. The ban spans a
period of five years, excluding, however, the last sixty
(60) days of the fifth (last) year of the CBA.

The contract bar rule prohibits the filing of a petition for
certification election during the existence of a collective
bargaining agreement except within the freedom period, as it is
called, when the said agreement is about to expire. The
purpose, obviously, is to ensure stability in the relationships of
the workers and the management by preventing frequent
modifications of any collective bargaining agreement earlier
entered into by them in good faith and for the stipulated
original period.

The freedom period under Articles 253-A and 256 is
different from and ought not to be mistaken for the
other sixty-day period mentioned in Art. 253. The latter
speaks of the right of the parties to propose
modifications to the existing CBA, as an exception to the
rule that the CBA cannot be modified during its lifetime.
To clarify terms, the sixty days in Art. 253 may be called
renegotiation notice period or simply notice/proposal
period, in contrast to the freedom period under Arts.
253-A and 256.

The notice period is the last 60 days of the second or
third year of the nonrepresentational provisions; the
freedom period is the last 60 days of the CBAs fifth year
of the representational aspect. The notice period is an
economic event involving the employer and the
bargaining union; the freedom period is a political event
involving only the unions and the employees. The two
periods, of course, may coincide on the fifth year of the
CBA.

Registered CBA

To bar a certification election it is no longer necessary
that the CBA be certified; it is enough that it is
registered in accordance with Art. 231.

Contract-Bar Rule Applied: Extended CBA Under Deadlock

No petition for certification election may be filed before
the onset of the freedom period not after such period.
The old CBA is extended until a new one is signed.

Section 6, Rule V, Book V of the implementing Rules provides
that a petition for certification election or a motion for
intervention can only be entertained within sixty days prior to
the expiry date of an existing collective bargaining agreement.
Otherwise put, the rule prohibits the filing of a petition for
certification election during the existence of a collective
bargaining agreement except within the freedom period, as it is
called, when the said agreement is about to expire.

Article 253 of the Labor Code provides that: "it shall be the duty
of both parties to keep the status quo and to continue in full
force and effect the terms and conditions of the existing
agreement during the 60-day period and/or until a new
agreement is reached by the parties." Despite the lapse of the
formal effectivity of the CBA the law still considers the same as
continuing in force and effect until a new CBA shall have been
validly executed. Hence, the contract bar rule still applies.

Contract-Bar Rule Applied: Unproved Surreptitious
Registration of CBA

Even if the existing CBA is registered surreptitiously, as
alleged by the petitioner union, but no evidence is
presented proving the alleged surreptitious registration,
the petition for CE cannot be granted. The contract-bar
rule applies. Whether or not the CBA was indeed
surreptitiously registered is a factual matter whose
determination is outside the ambit of a petition for
certiorari.

Contract-Bar Rule Not Applied: (a) Defective CBA

To be a bar to a certification election, the CBA must be
adequate in that it comprises substantial terms and conditions
of employment.

(b) Referendum to Register on Independent Union

This referendum is neither union disaffiliation nor severance; it
is not disallowed by law even while a CBA exists.

(c) CBA Signed Before or Within Freedom Period Despite
Injunctive Order

A collective bargaining agreement which was prematurely
renewed is not a bar to the holding of a certification election.
Such indecent haste in renewing the CBA despite an order
enjoining them from doing so is designed to frustrate the
constitutional right of the employees to self-organization.
Moreover, We cannot countenance the actuation of the
petitioner and the management in this case which is not
conducive to industrial peace.

Validity of CBA Signed During Representation Dispute

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It is true that the contract-bar rule does not apply during the
freedom period; i.e., within that period a petition for CE may
be entertained. But it is equally true that the petition for CE
does not bar the employer and the incumbent union from
renegotiating and renewing the expiring CBA. In other words, a
CBA may be renegotiated before, during, or after the 60-day
freedom period. But if during such period a PCE is filed, the
Med-arbiter can order the suspension of the renegotiation until
the representation proceedings finally end.

The law is attempting a balancing feat. By allowing a PCE
during the freedom period the law preserves democratic
between unions, and, in the same breadth, by allowing
CBA renegotiation during the same freedom period, the
law safeguards the opportunity to possibly upgrade the
employees employment condition.

The question may be asked: What would be the effect on
the renegotiated CBA if a union other than the one that
executed it should win the CE? In a pertinent case, it was
held that the union thus certified would have to respect
the contract, but that it may bargain with the
management to shorten the life of the contract if it is too
long.

When a collective bargaining agreement is entered into at a
time when the petition for certification election had already
been filed by a union and was then pending resolution, the said
CBA cannot be deemed permanent, precluding the
commencement of negotiations by another union with the
management. In the meantime however, so as not to deprive
the workers of the benefits of the said agreement, it shall be
recognized and given effect on a temporary basis, subject to
the results of the certification election. The agreement may be
continued in force if the union is certified as the exclusive
bargaining representative of the workers or may be rejected
and replaced in the event that the rival emerges as the winner.

But in a 2005 decision the Court took one step further. It
invalidated the hasty recognition of a union and the
signing of a CBA with that union where such acts were
done while there was a pending petition for certification
election by another union.

Basic to the contract bar rule is the proposition that the delay
of the right to select representatives can be justified only where
stability is deemed paramount. Excepted from the contract bar
rule are certain types of contracts which do not foster industrial
stability, such as contracts where the Identity of the
representative is in doubt. Any stability derived from such
contracts must be subordinated to the employees' freedom of
choice because it does not establish the type of industrial peace
contemplated by the law.

A CBA automatically renewed usually operates as a bar to a
certification election. But it is not a bar if the employer has
served notice that it will terminate the contract if and when the
union no longer represents the majority of the employees.

3.9 Invalid Grounds for the Denial/Suspension of the
Petition

Questions pertaining to the validity of petitioning unions
certificate of registration, or its legal personality as a
labor organization, or the validity of registration and
execution of collective bargaining agreements shall be
heard and resolved by the Regional Director in an
independent petition for cancellation of the unions
registration. They are not reasons for the Med-arbiter to
suspend hearing the PCE. However, the Med-arbiter
himself may rule on the objection if the pending union is
not found in the Departments roster of legitimate labor
organizations or an alleged collective bargaining
agreement is unregistered with the Department.

3.9a Authority to Decide Existence of Employer-
Employee Relationship; Med-Arbiters Order Appealable
to Secretary

Does the Med-arbiter or the Secretary of Labor and
Employment have the authority to determine the
existence of an employer-employee relationship
between the parties in a petition for certification
election?

All issues pertaining to the existence of employer-
employee relationship or to eligibility to union
membership shall be resolved in the order or decision
ranting or denying the petition for certification election.
In other words, those issues do not stall the PCE and they
are not grounds for dismissing a PCE.

It is absurd to suggest that the med-arbiter and Secretary of
Labor cannot make their own independent finding as to the
sentence of such relationship and must have to rely and wait
for such a determination by the labor arbiter or NLRC in a
separate proceeding. For then, given a situation where there is
no separate complaint filed with the labor arbiter, the med-
arbiter and/or the Secretary of Labor can never decide a
certification election case or any labor-management dispute
properly brought before them as they have no authority to
determine the existence of an employer-employee relationship.
Such a proposition is, to say the least, anomalous.

Once there is a determination as to the existence of such a
relationship, the med-arbiter can then decide the certification
election case. 9 As the authority to determine the employer-
employee relationship is necessary and indispensable in the
exercise of jurisdiction by the med-arbiter, his finding thereon
may only be reviewed and reversed by the Secretary of Labor
who exercises appellate jurisdiction under Article 259 of the
Labor Code, as amended.

It is apparent that incidental to the power of the med-
arbiter to hear and decide representation cases is the
power to determine who the eligible voters are. In so
doing, it is axiomatic that the med-arbiter should
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determine the legality of the employees' membership in
the union.

3.10 Action on the Petition: Is the Employer a
Bystander?See Art. 258-A

3.10a Employer a Bystander; Cannot Oppose PCE

3.11 Action on the Petition: Approval

Section 13. Order/Decision on the petition. - Within ten (10)
days from the date of the last hearing, the Med-Arbiter shall
issue a formal order granting the petition or a decision denying
the same. In organized establishments, however, no order or
decision shall be issued by the Med-Arbiter during the freedom
period.

The order granting the conduct of a certification election shall
state the following:

(a) the name of the employer or establishment;

(b) the description of the bargaining unit;

(c) a statement that none of the grounds for dismissal
enumerated in the succeeding paragraph exists;

(d) the names of contending labor unions which shall appear as
follows: petitioner union/s in the order in which their petitions
were filed, forced intervenor, and no union; and

(e) a directive upon the employer and the contending union(s)
to submit within ten (10) days from receipt of the order, the
certified list of employees in the bargaining unit, or where
necessary, the payrolls covering the members of the bargaining
unit for the last three (3) months prior to the issuance of the
order

3.12 Appeal of Order Granting or Denying Petition

Section 17. Appeal. - The order granting the conduct of a
certification election in an unorganized establishment shall not
be subject to appeal. Any issue arising therefrom may be raised
by means of protest on the conduct and results of the

The order granting the conduct of a certification election in an
organized establishment and the decision dismissing or denying
the petition, whether in an organized or unorganized
establishment, may be appealed to the Office of the Secretary
within ten (10) days from receipt thereof.

The appeal shall be verified under oath and shall consist of a
memorandum of appeal, specifically stating the grounds relied
upon by the appellant with the supporting arguments and
evidence.

In short, denial of any petition for CE is always
appealable, but never appealable is the approval of any
PCE in an enterprise still ununionized. The reason is
sound and simple: the law wants to unionized the
ununionized.

Section 18. Where to file appeal. - The memorandum of appeal
shall be filed in the Regional Office where the petition
originated, copy furnished the contending unions and the
employer, as the case may be. Within twenty-four (24) hours
from receipt of the appeal, the Regional Director shall cause the
transmittal thereof together with the entire records of the case
to the Office of the Secretary.

Section 19. Finality of Order/Decision. - Where no appeal is
filed within the ten-day period, the Med-Arbiter shall enter the
finality of the order/decision in the records of the case and
cause the transmittal of the records of the petition to the
Regional Director.

Section 20. Period to Reply. - A reply to the appeal may be filed
by any party to the petition within ten (10) days from receipt of
the memorandum of appeal. The reply shall be filed directly
with the Office of the Secretary.

Section 21. Decision of the Secretary. - The Secretary shall have
fifteen (15) days from receipt of the entire records of the
petition within which to decide the appeal. The filing of the
memorandum of appeal from the order or decision of the Med-
Arbiter stays the holding of any certification election.

The decision of the Secretary shall become final and executory
after ten (10) days from receipt thereof by the parties. No
motion for reconsideration of the decision shall be entertained.

Section 22. Transmittal of records to the Regional Office. -
Within forty-eight (48) hours from notice of receipt of decision
by the parties and finality of the decision, the entire records of
the case shall be remanded to the Regional Office of origin for
implementation. Implementation of the decision shall not be
stayed unless restrained by the appropriate court.

May a certification election be held legally upon petition
of Union B while a petition for CE by Union A is pending
on appeal at the Office of the Secretary? No, the appeal
should first be resolved.

3.13 Conducting the CE

3.13a Pre-election Conference

Section 1. Raffle of the case. - Within twenty-four (24) hours
from receipt of the notice of entry of final judgment granting
the conduct of a certification election, the Regional Director
shall cause the raffle of the case to an Election Officer who shall
have control of the pre-election conference and election
proceedings.

Section 2. Pre-election conference. - Within twenty-four (24)
hours from receipt of the assignment for the conduct of a
certification election, the Election Officer shall cause the
issuance of notice of preelection conference upon the
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105 | P L A T O N
contending unions and the employer, which shall be scheduled
within ten (10) days from receipt of the assignment.

The pre-election conference shall set the mechanics for the
election and shall determine, among others, the following:
(a) date, time and place of the election, which shall not be later
than forty-five (45) days from the date of the first pre-election
conference, and shall be on a regular working day and within
the employer's premises, unless circumstances require
otherwise;

(b) list of eligible and challenged voters;

(c) number and location of polling places or booths and the
number of ballots to be prepared with appropriate translations,
if necessary;

(d) name of watchers or representatives and their alternates
for each of the parties during election;

(e) mechanics and guidelines of the election.

Section 3. Waiver of right to be heard. - Failure of any party to
appear during the pre-election conference despite notice shall
be considered as a waiver to be present and to question or
object to any of the agreements reached in said pre-election
conference. Nothing herein, however, shall deprive the non-
appearing party or the employer of its right to be furnished
notices of subsequent pre-election conferences and to attend
the same.

Section 4. Minutes of pre-election conference. - The Election
Officer shall keep the minutes of matters raised and agreed
upon during the pre-election conference. The parties shall
acknowledge the completeness and correctness of the entries
in the minutes by affixing their signatures thereon. Where any
of the parties refuse to sign the minutes, the Election Officer
shall note such fact in the minutes, including the reason for
refusal to sign the same. In all cases, the parties shall be
furnished a copy of the minutes.

The pre-election conference shall be completed within thirty
(30) days from the date of the first hearing.

Section 6. Posting of Notices. - The Election Officer shall cause
the posting of notice of election at least ten (10) days before
the actual date of the election in two (2) most conspicuous
places in the company premises. The notice shall contain:
(a) the date and time of the election;

(b) names of all contending unions;

(c) the description of the bargaining unit and the list of eligible
and challenged voters.

The posting of the notice of election, the information required
to be included therein and the duration of posting cannot be
waived by the contending unions or the employer.

3.13b Conducting the CE: The Voters

One of the matters the pre-election conference threshes
out is the list of voters.

Section 5. Qualification of voters; inclusion-exclusion. - All
employees who are members of the appropriate bargaining
unit sought to be represented by the petitioner at the time of
the issuance of the order granting the conduct of a certification
election shall be eligible to vote.

The list of voters should be based on the employer-
certified list of employees in the CBU or payrolls. If the
employer does not submit the list or payrolls, the union
may submit its own list.

Even the list of employees submitted to the SSS may be
used as basis to comprise the list of voters for the CE. It
should ideally be the payroll which should have been
used for the purpose of the election. However, the
unjustified refusal of a company to submit the payroll in
its custody, despite efforts to make it produce it,
compelled resort to the SSS list as the next best source of
information. After all, the SSS list is a public record
whose regularity is presumed.

Only the employees who are directly employed by the
employer and working along the activities to which the
employer is engaged and linked by employer-employee
relationship are qualified to participate in the
certification election, irrespective of the period of their
employment.

Employees of an independent contractor who
undertakes to do a piece of work for his account and
responsibility, with minimum interference on the part of
the other contracting party (indirect employer), not
being laborers or employees of the latter, are not
qualified to participate therein.

In case of disagreement over the voters' list or over the
eligibility of voters, all contested voters shall be allowed to
vote. But their votes shall be segregated and sealed in
individual envelopes in accordance with Sections 10 and 11 of
this Rule.

Dismissed Employee

An employee who has been dismissed from work but has
contested the legality of the dismissal in a forum of
appropriate jurisdiction at the time of the issuance of the
order for the conduct of a certification election shall be
considered a qualified voter, unless his/her dismissal was
declared final judgment at the time of the conduct of the

In Philippine jurisprudence it is now settled that employees
who have been improperly laid off but who have a present,
unabandoned right to or expectation of re-employment, are
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106 | P L A T O N
eligible to vote in certification elections. 10 Thus, and to repeat,
if the dismissal is under question, as in the case now at bar
whereby a case of illegal dismissal and/or unfair labor practice
was filed, the employees concerned could still qualify to vote in
the elections.

Probationary Employee

In a certification election all rank-and-file employees in the
appropriate bargaining unit are entitled to vote. This principle is
clearly stated in Art. 255 of the Labor Code which states that
the "labor organization designated or selected by the majority
of the employees in an appropriate bargaining unit shall be the
exclusive representative of the employees in such unit for the
purpose of collective bargaining."

Collective bargaining covers all aspects of the employment
relation and the resultant CBA negotiated by the certified union
binds all employees in the bargaining unit. Hence, all rank-and-
file employees, probationary or permanent, have a substantial
interest in the selection of the bargaining representative. The
Code makes no distinction as to their employment status as
basis for eligibility in supporting the petition for certification
election. The law refers to "all" the employees in the bargaining
unit. All they need to be eligible to support the petition is to
belong to the "bargaining unit.".

INK Believers May Vote

In the CE all members of the unit, whether union
members or not, have the right to vote. Union
membership is not a prerequisite. If majority of the unit
members do not want a union, as expressed in the CE,
such majority decision must be respected.

Logically, the right NOT to join, affiliate with, or assist any
union, and to disaffiliate or resign from a labor organization, is
subsumed in the right to join, affiliate with, or assist any union,
and to maintain membership therein. The right to form or join a
labor organization necessarily includes the right to refuse or
refrain from exercising said right. It is self-evident that just as
no one should be denied the exercise of a right granted by law,
so also, no one should be compelled to exercise such a
conferred right. The fact that a person has opted to acquire
membership in a labor union does not preclude his
subsequently opting to renounce such membership.

The purpose of a certification election is precisely the
ascertainment of the wishes of the majority of the employees
in the appropriate bargaining unit: to be or not to be
represented by a labor organization, and in the affirmative
case, by which particular labor organization. If the results of the
election should disclose that the majority of the workers do not
wish to be represented by any union, then their wishes must be
respected, and no union may properly be certified as the
exclusive representative of the workers in the bargaining unit in
dealing with the employer regarding wages, hours and other
terms and conditions of employment. The minority employees
who wish to have a union represent them in collective
bargaining can do nothing but wait for another suitable
occasion to petition for a certification election and hope that
the results will be different. They may not and should not be
permitted, however, to impose their will on the majority
who do not desire to have a union certified as the exclusive
workers' benefit in the bargaining unit upon the plea that
they, the minority workers, are being denied the right of self-
organization and collective bargaining.

The respondents' argument that the petitioners are disqualified
to vote because they "are not constituted into a duly organized
labor union" "but members of the INK which prohibits its
followers, on religious grounds, from joining or forming any
labor organization" and "hence, not one of the unions which
vied for certification as sole and exclusive bargaining
representative," is specious. Neither law, administrative rule
nor jurisprudence requires that only employees affiliated with
any labor organization may take part in a certification election.
On the contrary, the plainly discernible intendment of the law is
to grant the right to vote to all bona fide employees in the
bargaining unit, whether they are members of a labor
organization or not.

3.13c Conducting the CE: The Voting

Section 7. Secrecy and sanctity of the ballot. - To ensure secrecy
of the ballot, the Election Officer, together with the authorized
representatives of the contending unions and the employer,
shall before the start of the actual voting, inspect the polling
place, the ballot boxes and the polling booths.

Section 8. Preparation of ballots. - The Election Officer shall
prepare the ballots in English and Filipino or the local dialect,
corresponding to the number of voters and a reasonable
number of extra ballots. All ballots shall be signed at the back
by the Election Officer and authorized representative of each of
the contending unions and employer. Failure or refusal to sign
the ballots shall be considered a waiver thereof and the
Election Officer shall enter the fact of such refusal or failure in
the records of the case as well as the reason for the refusal or
failure to sign.

Section 9. Marking of votes. - The voter must put a cross () or
check () mark in the square opposite the name of the union of
his choice or "No Union" if he/she does not want to be
represented by any union.

If a ballot is torn, defaced or left unfilled in such a manner as to
create doubt or confusion or to identify the voter, it shall be
considered spoiled. If the voter inadvertently spoils a ballot,
he/she shall return it to the Election Officer who shall destroy it
and give him/her another ballot.

Section 10. Challenging of votes. - An authorized representative
of any of the contending unions and employer may challenge a
vote before it is deposited in the ballot box only on any of the
following grounds:
(a) that there is no employer-employee relationship between
the voter and the company;

(b) that the voter is not a member of the appropriate
bargaining unit which petitioner seeks to represent.
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Section 11. Procedure in the challenge of votes. - When a vote
is properly challenged, the Election Officer shall place the ballot
in an envelope which shall be sealed in the presence of the
voter and the representatives of the contending unions and
employer. The Election Officer shall indicate on the envelope
the voter's name, the union or employer challenging the voter,
and the ground for the challenge. The sealed envelope shall
then be signed by the Election Officer and the representatives
of the contending unions and employer. The Election Officer
shall note all challenges in the minutes of the election and shall
be responsible for consolidating all envelopes containing the
challenged votes. The envelopes shall be opened and the
question of eligibility shall be passed upon only if the number
of segregated voters will materially alter the results of the
election.

Section 12. On-the-spot questions. - The Election Officer shall
rule on any question relating to and raised during the conduct
of the election. In no case, however, shall the election officer
rule on any of the grounds for challenge specified in the
immediately preceding section.

Section 13. Protest; when perfected. - Any party-in-interest
may file a protest based on the conduct or mechanics of the
election. Such protests shall be recorded in the minutes of the
election proceedings. Protests not so raised are deemed
waived.

The protesting party must formalize its protest with the Med-
Arbiter, with specific grounds, arguments and evidence, within
five (5) days after the close of the election proceedings. If not
recorded in the minutes and formalized within the prescribed
period, the protest shall be deemed dropped.

Section 15. Conduct of election and canvass of votes. - The
election precincts shall open and close on the date and time
agreed upon during the pre-election conference. The opening
and canvass shall proceed immediately after the precincts have
closed. Failure of any party or the employer or his/her/their
representative to appear during the election proceedings shall
be considered a waiver to be present and to question the
conduct thereof.

ULP in Relation to Election

The employer deserves our strongest condemnation for
ignoring the petitioners' request for permission for some time
out to attend to the hearing of their petition before the med-
arbiter. It is not only an act of arrogance, but a brazen
interference as well with the employees right to self-
organization, contrary to the prohibition of the Labor Code
against unfair labor practices.

It is unfair labor practice for the company to suspended the
workers on the ground of "abandonment of work" on the day
on which the pre-election conference had been scheduled. It is
the employees right to hold a certification election, the
exercise of which is their sole prerogative.

A company commits unfair labor practice where it issued
suspension and termination orders while the employees are in
the midst of a certification election preliminary to a labor
management conference "to normalize employer-employee
relations."

3.13d Conducting the CE: Canvassing of Votes

The voting shall close on the date and time agreed upon
in the pre-election conference. Canvassing shall
immediately follow.

Section 14. Canvassing of votes. - The votes shall be counted
and tabulated by the Election Officer in the presence of the
representatives of the contending unions. Upon completion of
the canvass, the Election Officer shall give each representative
a copy of the minutes of the election proceedings and results of
the election. The ballots and the tally sheets shall be sealed in
an envelope and signed by the Election Officer and the
representatives of the contending unions and transmitted to
the Med-Arbiter, together with the minutes and results of the
election, within twenty-four (24) hours from the completion of
the canvass.

Where the election is conducted in more than one region,
consolidation of results shall be made within fifteen (15) days
from the conduct thereof.

3.13e Who Wins in CE: Proclamation and Certification

Section 20. Proclamation and certification of the result of the
election. - Within twenty-four (24) hours from final canvass of
votes, there being a valid election, the Election Officer shall
transmit the records of the case to the Med-Arbiter who shall,
within the same period from receipt of the minutes and results
of election, issue an order proclaiming the results of the
election and certifying the union which obtained a majority of
the valid votes cast as the sole and exclusive bargaining agent
in the subject bargaining unit, under any of the following
conditions:

(a) no protest was filed or, even if one was filed, the same was
not perfected within the five-day period for perfection of the
protest;

(b) no challenge or eligibility issue was raised or, even if one
was raised, the resolution of the same will not materially
change the results of the elections.

The winning union shall have the rights, privileges and
obligations of a duly certified collective bargaining agent from
the time the certification is issued.

Where majority of the valid votes cast results in "No Union"
obtaining the majority, the Med-Arbiter shall declare such fact
in the order.

Section 16. Certification of Collective Bargaining Agent. - The
union which obtained a majority of the valid votes cast shall be
certified as the sole and exclusive bargaining agent of all the
employees in the appropriate bargaining unit within five (5)
LABOR RELATIONS
108 | P L A T O N
days from the day of the election, provided no protest is
recorded in the minutes of the election.

3,13f Failure of Election: Motion for a Remedial Election

Section 17. Failure of election. - Where the number of votes
cast in a certification or consent election is less than the
majority of the number of eligible voters and there are no
material challenged votes, the Election Officer shall declare a
failure of election in the minutes of the election proceedings.

Section 18. Effect of failure of election. - A failure of election
shall not bar the filing of a motion for the immediate holding of
another certification or consent election within six (6) months
from date of declaration of failure of election.

Section 19. Action on the motion. - Within twenty-four (24)
hours from receipt of the motion, the Election Officer shall
immediately schedule the conduct of another certification or
consent election within fifteen (15) days from receipt of the
motion and cause the posting of the notice of certification
election at least ten (10) days prior to the scheduled date of
election in two (2) most conspicuous places in the
establishment. The same guidelines and list of voters shall be
used in the election.

3.13g Run-off Election

Section 1. When proper. - When an election which provides for
three (3) or more choices results in none of the contending
unions receiving a majority of the valid votes cast, and there
are no objections or challenges which if sustained can
materially alter the results, the Election Officer shall motu
propio conduct a run-off election within ten (10) days from the
close of the election proceedings between the labor unions
receiving the two highest number of votes; provided, that the
total number of votes for all contending unions is at least fifty
(50%) percent of the number of votes cast.

"No Union" shall not be a choice in the run-off election.

Notice of run-off elections shall be posted by the Election
Officer at least five (5) days before the actual date of run-off
election.

Section 2. Qualification of voters. - The same voters' list used in
the certification election shall be used in the run-off election.
The ballots in the run-off election shall provide as choices the
unions receiving the highest and second highest number of the
votes cast. The labor union receiving the greater number of
valid votes cast shall be certified as the winner, subject to
Section 20, Rule IX.

To summarize, a run-off election is proper if five
concurrent conditions exist, namely:
1. a valid election took place because majority of the CBU
members voted.

2. the election presented a least three choices, e.g.,
Union One, Union Two, and No Union, meaning there are
at least two union candidates.

3. not one of the unions obtained the majority ofthe valid
votes.

4. the total number of votes for all the unions is at least
50% of the valid votes cast.

5. there is no unresolved challenge of voter or election
protest.

3.14 Appeal to Secretary as to Election ResultSee D.O.
No. 40-E-03 (dated 30 November 2005)

3.15 Election Irregularities, Protest by Employer

The manner in which the election was held could make the
difference between industrial strife and industrial harmony in
the company. What an employer is prohibited from doing is to
interfere with the conduct of the certification election for the
purpose of influencing its outcome. But certainly an employer
has an abiding interest in seeing to it that the election is clean,
peaceful, orderly and credible.

4. THIRD METHOD: CONSENT ELECTION

Like a CE, its purpose is the same, namely, to find out
which union should serve as the bargaining agent. The
difference is that a certification is ordered by the
Department while a consent election is voluntarily
agreed upon by the parties, with or without the
intervention of the Department.

Two or more unions are involved in a consent election.
And like certification election, consent election may take
place in an unorganized or organized establishment.

4.1 Effect of Consent Election

Section 23. Effects of consent election. - Where a petition for
certification election had been filed, and upon the intercession
of the Med-Arbiter, the parties agree to hold a consent
election, the results thereof shall constitute a bar to the holding
of a certification election for one (1) year from the holding of
such consent election. Where an appeal has been filed from the
results of the consent election, the running of the one-year
period shall be suspended until the decision on appeal has
become final and executory.

Where no petition for certification election was filed but the
parties themselves agreed to hold a consent election with the
intercession of the Regional Office, the results thereof shall
constitute a bar to another petition for certification election.

5. THE WINNER AS SOLE AND EXCLUSIVE
REPRESENTATIVE
LABOR RELATIONS
109 | P L A T O N

Collective bargaining contemplates the representation of
the collective bargaining interests of all the employees in
the particular bargaining unit by a properly selected
bargaining agent. The selection of a bargaining agent by
a majority of such employees, under express provisions
of the Act, constitutes the agent as the representative of
all the employees within the particular bargaining unit.
The Act provides that such bargaining agent shall be the
exclusive representative of the employees. The term
exclusive was interpreted under the original Act to
mean that the employer must treat with the
representative to the exclusion of all other claiming
bargaining agents.

5.1 Exclusive Bargaining Agent Represents Even the
Minority Union

On the part of the union that won in the certification election, it
becomes, and is certified as, the exclusive bargaining agent of
all the workers in the bargaining unit. It represents even the
members of the minority union.

However, although the union has every right to represent its
members in the negotiation regarding the terms and conditions
of their employment, it cannot negate their wishes on matters
which are purely personal and individual to them.

5.2 Protection and Capacity of the Loser; the Duty of Fair
Representation

What if the majority union neglects the interest of the
employees in the minority union? The majority union in
such case will be violating its duty of fair representation.
This duty obligates the majority union to serve the
interest of all members of the whole bargaining unit
without hostility or discrimination.

What can the minority do?The minority union, although
a loser in the election, does not lose its character as a
lawful labor organization entitled to protection under
Article 246 which makes it unlawful for any person to
abridge the right to self-organization. (see also Article
255)

May a minority union charge the employer with ULP?
Yes. It can file an individual or group complaint for ULP. It
can even engage in peaceful concerted activity. But it
cannot resort to work stoppage or strike because strike is
reserved, under Article 263, to an exclusive bargaining
representative (i.e., the majority union), if there is one.

5.3 Is the Bargaining Union a Majority Union?

The minority unions entitlement to protection gains
greater force and respect if it is remembered that the
bargaining union does not always comprise the
numerical majority in the bargaining unit.

Article 256 requires, for a union to win a CE, only a
majority of the valid votes cast. The majority of the valid
votes may be lesser that the majority of the employees in
the bargaining unit.

Article 256 therefore does not support Article 255; in
fact, they are incongruent. Whereas Article 255 requires
selection by majority of the unit members, Article 256
requires only majority of the valid votes cast. The result
may be a bargaining agent that does not carry the
mandate of the majority of the employees.

5.4 May the Bargaining Agent Represent Retired
Employees?

In pursuing their claim for retirement benefits under the
CBA, the claimant retirees are represented by the union
of which they were former members.
________

Title VII-A
GRIEVANCE MACHINERY
AND VOLUNTARY ARBITRATION

Article. 260. Grievance machinery and voluntary
arbitration. - The parties to a Collective Bargaining
Agreement shall include therein provisions that will
ensure the mutual observance of its terms and
conditions. They shall establish a machinery for the
adjustment and resolution of grievances arising from the
interpretation or implementation of their Collective
Bargaining Agreement and those arising from the
interpretation or enforcement of company personnel
policies.

All grievances submitted to the grievance machinery
which are not settled within seven (7) calendar days from
the date of its submission shall automatically be referred
to voluntary arbitration prescribed in the Collective
Bargaining Agreement.

For this purpose, parties to a Collective Bargaining
Agreement shall name and designate in advance a
Voluntary Arbitrator or panel of Voluntary Arbitrators, or
include in the agreement a procedure for the selection of
such Voluntary Arbitrator or panel of Voluntary
Arbitrators, preferably from the listing of qualified
Voluntary Arbitrators duly accredited by the Board. In
case the parties fail to select a Voluntary Arbitrator or
panel of Voluntary Arbitrators, the Board shall designate
the Voluntary Arbitrator or panel of Voluntary
Arbitrators, as may be necessary, pursuant to the
selection procedure agreed upon in the Collective
LABOR RELATIONS
110 | P L A T O N
Bargaining Agreement, which shall act with the same
force and effect as if the Arbitrator or panel of
Arbitrators has been selected by the parties as described
above.
________

1. CONTRACT ADMINISTRATION AS PART OF THE DUTY
TO BARGAIN

Collective bargaining is not an end in itself. It is a means
to an end, which is the making of collective agreements
stabilizing employment relations for a period of time
with results advantageous both to the worker and the
employer.

However narrowly it may canalize its course, the
execution of a contract does not complete collective
bargaining. Piece rates and work assignments frequently
require day-to-day adjustments; periodic decisions must
be made concerning such matters as shop rules, job
content, and the letting of subcontracts. There will be
ambiguities in the agreement to be clarified and gaps be
filled. In other words, the duty to bargain continues into
the contract administration stage.

In effect, therefore, contract negotiations are the
legislative process of collective bargaining; the day-to-
day working out of plant problems is its administrative or
judicial aspects.

Strengthening the binding force of the CBA, Art. 248
considers as unfair labor practice any act that violates an
existing collective bargaining agreement. But this law
must be related to Art, 261 which limits that kind of ULP
to gross violations only.

2. C.B.A., LAW BETWEEN THE PARTIES

The provisions of the collective bargaining agreement must be
respected since its terms and conditions "constitute the law
between the parties." Those who are entitled to its benefits can
invoke its provisions. In the event that an obligation therein
imposed is not fulfilled, the aggrieved party has the right to go
to court for redress.

Unilaterally formulated rules and policy can neither
contradict nor undermine the CBA provisions.

Since the collective bargaining agreement is considered the law
between the parties, containing as it does the agreed terms of
employment of the employee with his employer, unilaterally
imposed orders or rules qualifying the terms contained in the
agreement are subordinate to the CBA. At most, such rules,
such as the rules on trips abroad formulated by petitioner
[school] a few months before Legaspis application, are merely
suppletory and can neither contradict nor undermine the terms
found in the CBA.

2.1 Construing the Contract

The CBA being a contract, the rules embodied in the Civil Code
on interpretation of contracts should govern. The intent of the
parties should be ascertained by considering relevant
provisions of the said CBA.The intention of the parties is
primordial; if the terms of the contract are clear, the literal
meaning of the stipulations shall control, but if the words
appear to be contrary to the evident intention of the parties,
the latter shall prevail over the former.

Any doubts or ambiguity in the contract between management
and the union members should be resolved in the light of
Article 1702 of the Civil Code that:In case of doubt, all labor
legislation and all labor contracts shall be construed in favor of
the safety and decent living for the laborer.This is also in
consonance with the principle enunciated in the Labor Code
that all doubts should be resolved in favor of the worker.

But contracts which are not ambiguous are to be interpreted
according to their literal meaning and should not be interpreted
beyond their obvious intendment.

Compliance with a CBA is mandated by the expressed policy to
give protection to labor. In the same vein, CBA provisions
should be "construed liberally rather than narrowly and
technically, and the courts must place a practical and realistic
construction upon it, giving due consideration to the context in
which it is negotiated and purpose which it is intended to
serve." This is founded on the dictum that a CBA is not an
ordinary contract but one impressed with public interest. It
goes without saying, however, that only provisions embodied in
the CBA should be so interpreted and complied with.

2.2 Proposal Contained in Minutes but Not in the CBA
Itself

A proposal mentioned in the negotiation but not
embodied in the collective bargaining contract itself is
not part of the CBA. It cannot serve as basis of a charge
of violating the CBA or of bargaining in bad faith.

2.3 Zipper Clause

A device to forestall negotiation proposals after the CBA
has been signed is the zipper clause. It is a stipulation
in a CBA indicating that issues that could have been
negotiated but not contained in the CBA cannot be raised
for negotiation when the CBA is already in effect. In
short, the CBA is a complete agreement; negotiation is
closed, as a zipper does.

3. LAW DEEMED WRITTEN IN CONTRACT

The principle is thus well-settledthat an existing law
enters into and forms part of a validcontract without the
need for the parties expressly makingreference to it.
LABOR RELATIONS
111 | P L A T O N
Only thus could its validity insofar as some ofits
provisions are concerned be assured.

4. BINDING EFFECT OF AGREEMENT

A collective bargaining agreement entered into by officers of a
union, as agent of the members, and an employer, gives rise to
valid enforceable contractual relations, against the individual
union members in matters that affect them peculiarly, and
against the union in matters that affect the entire membership
or large classes of its members," and "a union member who is
employed under an agreement between the union and his
employer is bound by the provisions thereof, since it is a joint
and several contract of the members of the union entered into
by the union as their agent."

4.1 Persons Entitled to Benefits

It is true that whatever benefits the majority union obtains
from the employer accrue to its members as well as to non-
members. For the benefits of a collective bargaining agreement
are extended to all employees regardless of their membership
in the union because to withhold the same from the non-
members would be to discriminate against them.

It is even conceded that a laborer can claim benefits from a
collective bargaining agreement entered into between the
company and the union of which he is a member at the time of
the conclusion of the agreement, even after he has resigned
from said union.

4.2 Managers Not Entitled to CBA Benefits; Exception

Managers, who are not allowed to unionize to bargain
collectively with the employer, cannot claim the benefits
contained in the CBA negotiated by the workers under
them. They cannot obtain indirectly what they cannot do
directly.

Accordingly, managerial employees cannot, in the absence of
an agreement to the contrary, be allowed to share in the
concessions obtained by the labor union through collective
negotiation. Otherwise, they would be exposed to the
temptation of colluding with the union during the negotiations
to the detriment of the employer.

However, there is nothing to prevent the employer from
granting benefits to managerial employees equal to or higher
than those afforded to union members. There can be no
conflict of interest where the employer himself voluntarily
agrees to grant such benefits to managerial employees. In the
case at bar, at the beginning of petitioner's employment, he
was told that those who are not covered by the CBA would
nevertheless be entitled to benefits which would be, if not
higher, at least equivalent to those provided in the CBA. That
private respondents made such a promise to petitioner is not
denied by them.

4.3 Effect of Collective Agreement on the Individual
Contracts of Employment

When a collective agreement is concluded between a
labor union and an employer, the members of the labor
union are precluded from entering into individual
contracts of employment. But if the agreement merely
fixes wages and working conditions, the employer may
enter into particular contracts of employment with his
employees even though both are bound by the general
contract as to wages and working conditions.

5. ENFORCEABILITY AGAINST TRANSFEREE OF
ENTERPRISE

5.1 Purchase of Assets

The rule is that unless expressly assumed, labor contracts such
as employment contracts and collective bargaining agreements
are not enforceable against a transferee of an enterprise, labor
contracts being in personam, thus binding only between the
parties. A labor contract merely creates an action in personally
and does not create any real right which should be respected
by third parties. This conclusion draws its force from the right
of an employer to select his employees and to decide when to
engage them as protected under our Constitution, and the
same can only be restricted by law through the exercise of the
police power.

As a general rule, there is no law requiring a bona fide
purchaser of assets of an on-going concern to absorb in its
employ the employees of the latter.

5.2 Exceptions

Although the purchaser of the assets or enterprise is not legally
bound to absorb in its employ the employers of the seller of
such assets or enterprise, the parties are liable to the
employees if the transaction between the parties is colored or
clothed with bad faith.

5.3 Merger and Consolidation

Merger takes place when two or more corporations join
into a single corporation which is one of the merging
corporations; the separate existence of the other
constituent corporations ceases. Consolidation occurs
when two or more corporations join into a new single
corporation; the separate existence of all the constituent
corporations ceases, except that of the consolidated
corporation.

Section 80. Effects of merger or consolidation. - The merger or
consolidation shall have the following effects:

xxx

5. The surviving or consolidated corporation shall be
responsible and liable for all the liabilities and obligations of
each of the constituent corporations in the same manner as if
LABOR RELATIONS
112 | P L A T O N
such surviving or consolidated corporation had itself incurred
such liabilities or obligations; and any pending claim, action or
proceeding brought by or against any of such constituent
corporations may be prosecuted by or against the surviving or
consolidated corporation. The rights of creditors or liens upon
the property of any of such constituent corporations shall not
be impaired by such merger or consolidation. (n)

5.4 Wiley Doctrine

The disappearance by merger of a corporate employer
which has entered into a collective bargaining agreement
with a union does not automatically terminate all rights
of the employees covered by the agreement, even
though the merger is for genuine business reasons.
Under the Wiley doctrine, a duty to arbitrate arising from
a collective bargaining agreement survives the
employers ceasing to do business as a separate entity
after its merger with a substantially large corporation, so
as to be binding on the larger corporation, where
relevant similarity and continuity of operations across
the change in ownership is evidenced by the wholesale
transfer of the smaller corporations employees to the
larger corporations plant. If a contractual duty to
arbitrate survives the employers merger into another
corporate employer, question as to the effect of the
merger on the rights of the employees covered by the
agreementthe former employees of the merged
employerare arbitrable if questions as to those rights
would have been arbitrable before the merger.

But a duty to arbitrate arising from collective bargaining
agreement does not survive in every case in which the
ownership or corporate structure of an enterprise is
changed. It does not survive where there is lack of any
substantial continuity of identity in the business
enterprise before and after a change, or where the union
abandons its right to arbitration by failing to make its
claims known.

6. CHANGE OF BARGAINING AGENT; SUBSTITUTIONARY
DOCTRINE

How does disaffiliation affect the CBA?

The agreement is binding on the parties for the period therein
specified. The employees cannot revoke the validly executed
collective bargaining contract with their employer by the simple
expedient of changing their bargaining representative. Thus,
when there occurs a shift in employees' union allegiance after
the execution of a bargaining contract with their employer, and
the employees change their bargaining representative, the
contract continues to bind them up to its expiration date. The
new agent, however, may bargain for the shortening of the
contract period.

In formulating the "substitutionary" doctrine, the only
consideration involved was the employees' interest in the
existing bargaining agreement. The agent's interest never
entered the picture. In fact, the justification 9 for said doctrine
was:

xxxthat the majority of the employees, as an entity under the
statute, is the true party in interest to the contract, holding
rights through the agency of the union representative. Thus,
any exclusive interest claimed by the agent is defeasible at the
will of the principal.... (Emphasis supplied)

Stated otherwise, the "substitutionary" doctrine only provides
that the employees cannot revoke the validly executed
collective bargaining contract with their employer by the simple
expedient of changing their bargaining agent. And it is in the
light of this that the phrase "said new agent would have to
respect said contract" must be understood. It only means that
the employees, thru their new bargaining agent, cannot renege
on their collective bargaining contract, except of course to
negotiate with management for the shortening thereof.

The "substitutionary" doctrine, therefore, cannot be invoked to
support the contention that a newly certified collective
bargaining agent automatically assumes all the personal
undertakings like the no-strike stipulation here in the
collective bargaining agreement made by the deposed union.
When BBWU bound itself and its officers not to strike, it could
not have validly bound also all the other rival unions existing in
the bargaining units in question. BBWU was the agent of the
employees, not of the other unions which possess distinct
personalities. To consider UNION contractually bound to the
no-strike stipulation would therefore violate the legal maxim
that res inter alios nec prodest nec nocet.

7. GRIEVANCES

A grievance is defined as any question by either the
employer or the union regarding the interpretation or
application of the collective bargaining agreement or
company personnel policies or any claim by either party
that the other party is violating any provision of the CBA
or company personnel policies.

If the term grievance is to be applied in the loose or
generic sense, any dispute or controversy respecting
terms and conditions of employment which an employee
or group of employees may present to the employer can
be a grievance, even without a union or CBA.

The expansion of the original and exclusive jurisdiction of
voluntary arbitrators to include questions arising from
the interpretation and enforcement of company
personnel policies has the effect of widening the meaning
and interpretation of a grievance to include a situation
where there is no collective bargaining agent and no
CBA.

Personnel policies are guiding principles stated in broad,
long-range terms that express the philosophy or beliefs
LABOR RELATIONS
113 | P L A T O N
of an organizations top authority regarding personnel
matters.

They deal with matters affecting efficiency and well-
being of employees and include, among others, the
procedures in administration of wages, benefits,
promotions, transfer and other personnel movements
which are usually not spelled out in the collective
agreement. The usual source of grievances, however, is
the rules and regulations governing disciplinary actions.

7.1 By-passing the Grievance Machinery: ULP

All grievances arising from the implementation or
interpretation of the collective bargaining agreement
and/or interpretation and enforcement of company
personnel policies are compulsorily subject to the
grievance of machinery.

Upholding the requirement, the Court has ruled that the
grievance procedure provided in the CBA should be
adhered to by the parties. Refusal or failure to do so is an
unfair labor practice, because the grievance procedure is
part of the continuous process of collective bargaining. It
is intended to promote friendly dialogue between labor
and management as a means of maintaining industrial
peace.

Before an aggrieved employee may resort to the courts
to enforce his individual rights under a bargaining
contract, the employee must exhaust all the remedies
available to him under such contract. And a court should
not entertain any complaint by an aggrieved employee
until proper use has been made of the contract grievance
procedure agreed upon by employer and the bargaining
representative.

The grievance machinery under the agreement is the
very heart of industrial self0government.

May a grievance be brought to voluntary arbitration
without passing through the grievance procedure under
the CBA?

This appears to be proscribed by the Labor Code which
directs the parties to a CBA to establish a grievance
machinery for the adjustment and resolution of
grievances arising from the interpretation or
enforcement of company personnel policies.

In view, however, of the State policy to encourage
voluntary arbitration of all other labor-management
disputes, it is submitted that a grievance may be brought
directly to voluntary arbitration without passing through
the grievance machinery, especially when the latter has
been proven to be ineffective in the past, or when the
parties inadvertently failed to include a grievance
machinery provision in their CBA.

7.2 Waiver of Grievance Machinery Procedure and
Submission to VA

Article 262 of the Labor Code provides that upon agreement of
the parties, the voluntary arbitrator can hear and decide all
other labor disputes.

Contrary to the finding of the Court of Appeals, voluntary
arbitration as a mode of settling the dispute was not forced
upon respondents. Both parties indeed agreed to submit the
issue of validity of the dismissal of petitioner to the jurisdiction
of the voluntary arbitrator by the Submission Agreement duly
signed by their respective counsels. As the voluntary arbitrator
had jurisdiction over the parties' controversy, discussion of the
second issue is no longer necessary.

The employees waiver of her option to submit her case to
grievance machinery did not amount to relinquishing her right
to avail herself of voluntary arbitration.

7.3 Structure and Procedure

In the absence of applicable provision in the collective
bargaining agreement, a grievance committee shall be created
within ten (10) days from signing of the collective bargaining
agreement. The committee shall be composed of at least two
(2) representatives each from the members of the bargaining
unit and the employer, unless otherwise agreed upon by the
parties. The representatives from among the members of the
bargaining unit shall be designated by the union.

Section 2. Procedure in handling grievances. - In the absence of
a specific provision in the collective bargaining agreement or
existing company practice prescribing for the procedures in
handling grievance, the following shall apply:

(a) An employee shall present this grievance or complaint orally
or in writing to the shop steward. Upon receipt thereof, the
shop steward shall verify the facts and determine whether or
not the grievance is valid.

(b) If the grievance is valid, the shop steward shall immediately
bring the complaint to the employee's immediate supervisor.
The shop steward, the employee and his immediate supervisor
shall exert efforts to settle the grievance at their level.

(c) If no settlement is reached, the grievance shall be referred
to the grievance committee which shall have ten (10) days to
decide the case.

Where the issue involves or arises from the interpretation or
implementation of a provision in the collective bargaining
agreement, or from any order, memorandum, circular or
assignment issued by the appropriate authority in the
establishment, and such issue cannot be resolved at the level of
the shop steward or the supervisor, the same may be referred
immediately to the grievance committee.

LABOR RELATIONS
114 | P L A T O N
8. VOLUNTARY ARBITRATION

Section 3. Submission to voluntary arbitration. - Where
grievance remains unresolved, either party may serve notice
upon the other of its decision to submit the issue to voluntary
arbitration. The notice shall state the issue or issues to be
arbitrated, copy thereof furnished the board or the voluntary
arbitrator or panel of voluntary arbitrators named or
designated in the collective bargaining agreement. If the party
upon whom the notice is served fails or refuses to respond
favorably within seven (7) days from receipt thereof, the
voluntary arbitrator or panel of voluntary arbitrators
designated in the collective bargaining agreement shall
commence voluntary arbitration proceedings. Where the
collective bargaining agreement does not so designate, the
board shall call the parties and appoint a voluntary arbitrator or
panel of voluntary arbitrators, who shall thereafter commence
arbitration proceedings in accordance with the proceeding
paragraph.

In instances where parties fail to select a voluntary arbitrator or
panel of voluntary arbitrators, the regional branch of the Board
shall designate the voluntary arbitrator or panel of voluntary
arbitrators, as may be necessary, which shall have the same
force and effect as if the parties have selected the arbitrator.

The parties to a CBA will decide on the number of
arbitrators who may hear a dispute only when the need
for it arises. Even the law itself does not specify the
number of arbitrators. Their alternatives whether to
have one or three arbitrators have their respective
advantages and disadvantages. In this matter, cost is not
the only consideration; full deliberation on the issues is
another, and it is best accomplished in a hearing
conducted by three arbitrators. In effect, the parties are
afforded the latitude to decide for themselves the
composition of the grievance machinery as they find
appropriate to a particular situation.

Labor arbitration is the reference of a labor dispute to a
third party for determination on the basis of evidence
and arguments presented by such parties, who are
bound to accept the decision.

Voluntary arbitration has been defined as a contractual
proceeding whereby the parties to any dispute or controversy,
in order to obtain a speedy and inexpensive final disposition of
the matter involved, select a judge of their own choice and by
consent submit their controversy to him for determination.
Under voluntary arbitration, on the other hand, referral of a
dispute by the parties is made, pursuant to a voluntary
arbitration clause in their collective agreement, to an impartial
third person for a final and binding resolution.

Ideally, arbitration awards are supposed to be complied with by
both parties without delay, such that once an award has been
rendered by an arbitrator, nothing is left to be done by both
parties but to comply with the same. After all, they are
presumed to have freely chosen arbitration as the mode of
settlement for that particular dispute. Pursuant thereto, they
have chosen a mutually acceptable arbitrator who shall hear
and decide their case. Above all, they have mutually agreed to
de bound by said arbitrator's decision.

Compulsory arbitration is a system whereby the parties to a
dispute are compelled by the government to forego their right
to strike and are compelled to accept the resolution of their
dispute through arbitration by a third party. 1 The essence of
arbitration remains since a resolution of a dispute is arrived at
by resort to a disinterested third party whose decision is final
and binding on the parties, but in compulsory arbitration, such
a third party is normally appointed by the government.

In Philippine context, the judge in voluntary arbitration is
called arbitrator, while that in compulsory is labor arbiter. The
jurisdiction of a VA is stated in Articles 261 and 262 while that
of an LA is in Article 217.

8.1 Voluntary Arbitration: A Private Judicial System

A voluntary arbitrator is not a public tribunal imposed
upon the parties by a superior authority which the
parties are obliged to accept. He has no general
character to administer justice for a community which
transcends the parties. He is rather part of a system of
self-government created by and confined to the parties.

The primary function of voluntary labor arbitration is to
provide (1) a process for the orderly disposition of
disputes and (2) a foundation for stable labor-
management relations.

8.2 Voluntary Arbitration: A Master Procedure

In labor-management relations voluntary arbitration is a
master procedure. Any and all kinds of labor disputes
may be submitted to, settled, or resolved through
voluntary arbitration, if the parties so desire. Money
claims, bargaining deadlocks, strike or lockout,
employment termination, and even questions about
existence or absence of employer-employee relationship,
may be resolved by the partieswith finalityby
availing themselves of voluntary arbitration.

As a master procedure voluntary arbitration takes
precedence over other dispute settlement devices (i.e.,
cases before the labor arbiter or Secretary of Labor or
the NLRC)

A dispute pending in voluntary arbitration (or
compulsory arbitration, for that matter) cannot be the
subject of a strike or lockout notice.

9. WHO MAY BE ACCREDITED AS VOLUNTARY
ARBITRATOR

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115 | P L A T O N
The following are the minimum criteria for accreditation as
voluntary arbitrator:

1. A Filipino citizen residing in the Philippines;

2. A holder of at least a Bachelors Degree in any field of
behavioral or applied sciences or equivalent educational
training short of a Bachelors Degree;

3. At least five (5) years experience in the field of Labor-
Management relations;

4. Completion of a training course on voluntary arbitration
conducted by the Board; and

5. A person of good moral character, noted for impartiality,
probity, and has not been civilly, criminally and administratively
adjudged guilty of any offense involving moral turpitude as
evidenced by a duly sworn affidavit.

10. HOW VOLUNTARY ARBITRATOR IS CHOSEN

A voluntary arbitrator is chosen by the parties
themselves (preferably accredited by the NCMB). The
choice is usually influenced by the trust in the persons
fairness and knowledge of the dynamics, including law,
of labor-management relation.

The preferred method of selection is by mutual
agreement of the parties. Alternative methods include
the selection or appointment by an administrative
agency like the NCMB.

Parties in general may choose between the use of a
temporary (when a dispute is already at hand; specific) or
permanent arbitrator (before a dispute arises; for a
period of time, usually during the life of the CBA). They
have also a choice as to the number of arbitrators, either
a sole arbitrator or a panel of arbitrators or Arbitration
Board.

11. DISTINGUISHED FROM A COURT OF LAW

Court of Law Arbitration
Formal Informal
Follow precedents Not obliged
Rules of evidence observed Not observed
Decisions may be appealed
to the higher court
No comparable appeal
recourse
Hear a great variety of
cases
Hear only industrial
disputes
Services of a lawyer is
essential due to complexity
Not essential

Arbitration, in sum, is a non-technical and relatively
inexpensive procedure for obtaining a quick solution to
industrial disputes by persons who have specialized
knowledge of labor management relations.
________

Article. 261. Jurisdiction of Voluntary Arbitrators or panel
of Voluntary Arbitrators. - The Voluntary Arbitrator or
panel of Voluntary Arbitrators shall have original and
exclusive jurisdiction to hear and decide all unresolved
grievances arising from the interpretation or
implementation of the Collective Bargaining Agreement
and those arising from the interpretation or enforcement
of company personnel policies referred to in the
immediately preceding article. Accordingly, violations of
a Collective Bargaining Agreement, except those which
are gross in character, shall no longer be treated as
unfair labor practice and shall be resolved as grievances
under the Collective Bargaining Agreement. For purposes
of this article, gross violations of Collective Bargaining
Agreement shall mean flagrant and/or malicious refusal
to comply with the economic provisions of such
agreement.

The Commission, its Regional Offices and the Regional
Directors of the Department of Labor and Employment
shall not entertain disputes, grievances or matters under
the exclusive and original jurisdiction of the Voluntary
Arbitrator or panel of Voluntary Arbitrators and shall
immediately dispose and refer the same to the Grievance
Machinery or Voluntary Arbitration provided in the
Collective Bargaining Agreement.
________

Article. 262. Jurisdiction over other labor disputes. - The
Voluntary Arbitrator or panel of Voluntary Arbitrators,
upon agreement of the parties, shall also hear and decide
all other labor disputes including unfair labor practices
and bargaining deadlocks.
________

1. ARBITRABLE DISPUTES

In the field of labor relations, arbitration applies to two
kinds of disputes: (1) contract-negotiation disputes; and
(2) contract-interpretation disputes. Contract negotiation
disputes are disputes as to the terms of a collective
bargaining agreement. Where there is an existing
agreement to arbitrate such disputes, and a bargaining
deadlock or impasse has arisen, the disputants submit to
an impartial outsider for settlement the collective
bargaining issue which they had been unable to settle by
themselves, whether or not aided by conciliators.
Contract interpretation disputes are disputes arising
under an existing collective bargaining agreement,
involving such matters as the interpretation and
application of the contract, or alleged violation of its
provisions.
LABOR RELATIONS
116 | P L A T O N

Arbitration of contract negotiation disputes is often
known as arbitration of interest, while arbitration of
contract interpretation disputes is known as arbitration
of grievance or rights.

2. JURISDICTION OF L.A. AND V.A.

The aforecited provisions of law cannot be read in isolation or
separately. They must be read as a whole and each Article of
the Code reconciled one with the other. An analysis of the
provisions of Articles 217, 261, and 262 indicates, that:

1.The jurisdiction of the Labor Arbiter and Voluntary Arbitrator
or Panel of Voluntary Arbitrators over the cases enumerated in
Articles 217, 261 and 262, can possibly include money claims in
one form or another.

2.The cases where the Labor Arbiters have original and
exclusive jurisdiction are enumerated in Article 217, and that of
the Voluntary Arbitrator or Panel of Voluntary Arbitrators in
Article 261.

3.The original and exclusive jurisdiction of Labor Arbiters is
qualified by an exception as indicated in the introductory
sentence of Article 217 (a), to wit:

Art. 217. Jurisdiction of Labor Arbiters . . . (a) Except as
otherwise provided under this Code the Labor Arbiter shall
have original and exclusive jurisdiction to hear and decide . . .
the following cases involving all workers. . . .

The phrase "Except as otherwise provided under this Code"
refers to the following exceptions:

A.Art. 217. Jurisdiction of Labor Arbiters . . .

xxx

(c)Cases arising from the interpretation or implementation of
collective bargaining agreement and those arising from the
interpretation or enforcement of company procedure/policies
shall be disposed of by the Labor Arbiter by referring the same
to the grievance machinery and voluntary arbitrator as may be
provided in said agreement.

B.Art. 262. Jurisdiction over other labor disputes. The
Voluntary Arbitrator or panel of Voluntary Arbitrators, upon
agreement of the parties, shall also hear and decide all other
labor disputes including unfair labor practices and bargaining
deadlocks.

4.The jurisdiction of Voluntary Arbitrator or Panel of Voluntary
Arbitrators is provided for in Arts. 261 and 262 of the Labor
Code as indicated above.

A.A close reading of Article 261 indicates that the original and
exclusive jurisdiction of Voluntary Arbitrator or Panel of
Voluntary Arbitrators is limited only to:

. . . unresolved grievances arising from the interpretation or
implementation of the Collective Bargaining Agreement and
those arising from the interpretation or enforcement of
company personnel policies . . . Accordingly, violations of a
collective bargaining agreement, except those which are gross
in character, shall no longer be treated as unfair labor practice
and shall be resolved as grievances under the Collective
Bargaining Agreement. . . . .

B.Voluntary Arbitrators or Panel of Voluntary Arbitrators,
however, can exercise jurisdiction over any and all disputes
between an employer and a union and/or individual worker as
provided for in Article 262.

It must be emphasized that the jurisdiction of the Voluntary
Arbitrator or Panel of Voluntary Arbitrators under Article 262
must be voluntarily conferred upon by both labor and
management. The labor disputes referred to in the same Article
262 can include all those disputes mentioned in Article 217
over which the Labor Arbiter has original and exclusive
jurisdiction.

As shown in the above contextual and wholistic analysis of
Articles 217, 261, and 262 of the Labor Code, the National
Labor Relations Commission correctly ruled that the Labor
Arbiter had no jurisdiction to hear and decide petitioner's
money-claim-underpayment of retirement benefits, as the
controversy between the parties involved an issue "arising from
the interpretation or implementation" of a provision of the
collective bargaining agreement. The Voluntary Arbitrator or
Panel of Voluntary Arbitrators has original and exclusive
jurisdiction over the controversy under Article 261 of the Labor
Code, and not the Labor Arbiter.

2.1 Jurisdiction over Termination Disputes

The preference or bias of the law in favor of voluntary
arbitration justifies the view that employment
termination disputes, arising from CBA or personnel
policy implementation, are cognizable by a voluntary
arbitrator and not a labor arbiter. Such termination
cases, if filed with a labor arbiter, is to be dismissed for
lack of jurisdiction and referred to the concerned NCMB
Regional Branch for appropriate action.

Article 260 of the Labor Code on grievance machinery and
voluntary arbitrator states that "(t)he parties to a Collective
Bargaining Agreement shall include therein provisions that will
ensure the mutual observance of its terms and conditions. They
shall establish a machinery for the adjustment and resolution of
grievances arising from the interpretation or implementation of
their Collective Bargaining Agreement and those arising from
the interpretation or enforcement of company personnel
policies." It is further provided in said article that the parties to
a CBA shall name or designate their respective representatives
to the grievance machinery and if the grievance is not settled in
that level, it shall automatically be referred to voluntary
arbitrators (or panel of voluntary arbitrators) designated in
advance by the parties. It need not be mentioned that the
parties to a CBA are the union and the company. Hence, only
LABOR RELATIONS
117 | P L A T O N
disputes involving the union and the company shall be referred
to the grievance machinery or voluntary arbitrators.

Article 261 of the Labor Code which grants to voluntary
arbitrators original and exclusive jurisdiction to hear and decide
all unresolved grievances arising from the interpretation or
implementation of the collective bargaining agreement and
those arising from the interpretation or enforcement of
company personnel policies. Note the phrase "unresolved
grievances." In the case at bar, the termination of petitioner is
not an unresolved grievance.

Article 260 further provides that the parties to a CBA shall
name or designate their respective representative to the
grievance machinery and if the grievance is unsettled in that
level, it shall automatically be referred to the voluntary
arbitrators designated in advance by the parties to a CBA of the
union and the company. It can thus be deduced that only
disputes involving the union and the company shall be referred
to the grievance machinery or voluntary arbitrators.

2.1a Policies, Rules, Procedures

Policies are formulated by management even before a
company opens for business in order to guide the men in
the operational level, the line manager or supervisor as
to the scope of their activities, authority and
responsibility, and to enable them to arrive at sound
decisions. Policies are valuable in fixing definite
objectives for the organization. Policy statements are
also needed to allow subordinate executives to make fair
and consistent decisions on recurrent problems. They
promote uniformity of action and prevent conflicting
decisions especially as regards labor matter.

Company policies must be issued by top management
which is responsible for making major policies that are by
nature company-wide in application.

Minor policies, better known as rules and procedures,
are the extension of major policies and are usually
formulated by minor executives or department
managers. Rules are specific guides intended to govern
conduct and action of operating supervisors and
employees in the performance of their designated
activities. Procedures are made to specify ways or
methods of carrying out policies and rules. A procedure
tells what work or task to do, how to do it, and when to
do it.

2.2 Jurisdiction over CBA Violations

CBA violations not constituting ULP are likewise
cognizable by a voluntary arbitrator if not resolved
through the grievance machinery. If the violations,
however, are gross in character, these are to be
treated as unfair labor practice which, following Art. 217
(a-1), are to be heard and decided by a labor arbiter.

The law wants the industrial players to resolve their
differences by and among themselves as much as
possible. And if they need help, they are likewise free to
agree where that help may come from.

For a ULP case to be cognizable by the Labor Arbiter, and the
NLRC to exercise its appellate jurisdiction, the allegations in the
complaint should show prima facie the concurrence of two
things, namely: (1) gross violation of the CBA; AND (2) the
violation pertains to the economic provisions of the CBA.

Unsubstantiated conclusions of bad faith and unjustified refusal
to re-employ petitioners, to our mind, do not constitute gross
violation of the CBA for purposes of lodging jurisdiction with
the Labor Arbiter and the NLRC. Although evidentiary matters
are not required (and even discouraged) to be alleged in
complaint, still, sufficient details supporting the conclusion of
bad faith and unjust refusal to re-employ petitioners must be
indicated. Furthermore, it is even doubtful if the CBA provision
on re-employment fits into the accepted notion of an economic
provision of the CBA.

2.3 Other Cases

Section 4. Jurisdiction of voluntary arbitrator or panel of
voluntary arbitrators. - The voluntary arbitrator or panel of
voluntary arbitrators shall have exclusive and original
jurisdiction to hear and decide all grievances arising from the
implementation or interpretation of the collective bargaining
agreements and those arising from the interpretation or
enforcement of company personnel policies which remain
unresolved after exhaustion of the grievance procedure.

They shall also have exclusive and original jurisdiction, to hear
and decide wage distortion issues arising from the application
of any wage orders in organized establishments, as well as
unresolved grievances arising from the interpretation and
implementation of the productivity incentive programs under
RA 6971.

Upon agreement of the parties, any other labor dispute may be
submitted to a voluntary arbitrator or panel of voluntary
arbitrators. Before or at any stage of the compulsory arbitration
process, the parties may opt to submit their dispute to
voluntary arbitration.

The National Labor Relations Commission, its regional branches
and Regional Directors of the Department of Labor and
Employment shall not entertain disputes, grievances or matters
under the exclusive and original jurisdiction of the voluntary
arbitrator or panel of voluntary arbitrators and shall
immediately dispose and refer the same to the appropriate
grievance machinery or voluntary arbitration provided in the
collective bargaining agreement.

2.4 Dispute over Companys Drug Abuse Policy

A unions petition to enjoin implementation of the companys
drug policy is a labor dispute beyond RTCs jurisdiction. It is a
personnel policy dispute within the jurisdiction of a VA.
LABOR RELATIONS
118 | P L A T O N

3. HOW VOLUNTARY ARBITRATION IS INITIATED

Voluntary arbitration may be initiated either by 1) a
Submission or 2) by a Demand or Notice invoking a
collective agreement arbitration clause. Sometimes both
instruments are used in a case.

Submission is sometimes called a Stipulation or an
Agreement to Arbitrate. It is used where there is no
previous agreement to arbitrate. The Submission, which
must be signed by both parties, describes an existing
dispute; it often names the arbitrator, procedures in the
hearing and it sometimes contains considerable details of
the arbitrators authority and other matters which the
parties wish to control. Submission is more appropriate
in interest disputes since collective agreement generally
do not provide for the arbitration of such disputes that
may arise in the future. Submission is often entered into
after the dispute has materialized and the issues can
already be defined.

However, Demand or Notice of Intent to Arbitrate is
more applicable to rights dispute because collective
agreements are required under RA 6715 to provide for a
grievance procedure and a voluntary arbitration clause
with respect to disputes arising from the application or
interpretation of the agreement. Thus, there is an
agreement to arbitrate future dispute that may arise
under and during the term of the CBA. If a dispute is
covered by such an arbitration clause, arbitration may be
initiated unilaterally by one party by serving upon the
other a written demand or notice of intent to arbitrate.

3.1 The Submission Agreement; Extent of Arbitrators
Authority

Although the contract may establish the breadth of the
arbitrators power and the limits of his authority, his
power may be more sharply defined in the submission
agreement. Frequently, the parties jointly formulate in
writing the specific issues to be decided by the arbitrator.
Sometimes the arbitrator is asked by the parties to help
them frame the issue on the basis of the written
grievance or the case as presented.

In general, the arbitrator is expected to decide those
questions expressly stated and limited in the submission
agreement. However, since arbitration is the final resort
for the adjudication of disputes, the arbitrator will
assume that he has the power to make a final
settlement.

It is thus essential to stress that the Voluntary Arbitrator
had plenary jurisdiction and authority to interpret the
agreement to arbitrate and to determine the scope of hs
own authority subject only, in a proper case, to the
certiorari jurisdiction of this Court.

Generally, the arbitrator is expected to decide only those
questions expressly delineated by the submission
agreement. Nevertheless, the arbitrator can assume that
he has the necessary power to make a final settlement
since arbitration is the final resort for adjudication of
disputes.

The issue of regularization should be viewed as two-tiered
issue. While the submission agreement mentioned only the
determination of the date or regularization, law and
jurisprudence give the voluntary arbitrator enough leeway of
authority as well as adequate prerogative to accomplish the
reason for which the law on voluntary arbitration was created
speedy labor justice. It bears stressing that the underlying
reason why this case arose is to settle, once and for all, the
ultimate question of whether respondent employees are
entitled to higher benefits. To require them to file another
action for payment of such benefits would certainly undermine
labor proceedings and contravene the constitutional mandate
providing full protection to labor.

4. POWERS OF THE ARBITRATOR

The study of collective bargaining agreements discloses
different types of arbitration clauses with varying
degrees of power granted to the arbitration. This power
may be very limited or unusually broad in scope.

4.1 Power to Arbitrate Any Dispute

The contract clause that gives the arbitrator the broadest
scope of power is commonly known as the disputes
clause.

This type of clause grants the arbitrator jurisdiction to
hear and determine practically any matter in dispute
between the parties. Moreover, he is not necessarily
limited to matters specifically stated in the contract. It is
common, however, for some relationship to be shown
between the matter in dispute and the provisions of the
contract.

4.2 No Power to Add To or Subtract From the Contract

Some arbitration clauses limit the arbitrators power to
an interpretation and application of the contract and
further specifically provide that he shall have no power
to add to or subtract from the contract.

Such clauses clearly state the parties intention that the
arbitrator will be empowered only to interpret the
contract but not add to or modify it.

LABOR RELATIONS
119 | P L A T O N
As a general rule, the authority of an arbitrator embraces
or covers the following:

1.General authority to investigate and hear the case
upon notice of the parties and to render an award based
on the contract and record of the case;

2.Incidental authority to perform all acts necessary to an
adequate discharge of his duties and responsibilities like
setting and conduct of hearing, attendance of witnesses
and proof documents and other evidences, fact-finding
and other modes of discovery, reopening of hearing, etc.;

3.Special power in aid of his general contractual
authority like the authority to determine arbitrability of
any particular dispute and to modify any provision of
existing agreement upon which a proposed change is
submitted for arbitration.

5. FUNCTIONS OF ARBITRATOR

The labor arbitrator under a collective bargaining
agreement is an indispensable agency in the continuous
collective bargaining process. He sits to settle disputes at
the plant leveldisputes which require for their solution
knowledge of the custom and practices of a particular
factory or of a particular industry as reflected in
particular agreements.

On the other hand, the power and authority of
arbitrators in labor dispute cases is derived from and
limited by the terms of the parties agreement. The
arbitrator is confined to interpretation and application of
the CBA; he does not sit to dispense his own brand of
industrial justice. The arbitrators authority is contractual
rather than judicial in nature; his power is conferred by
the CBA; and his duty with respect to that agreement is
to settle disputes arising thereunder by applying and
interpreting that agreement.

But so long as an arbitrator is not arbitrary, he has wide
latitude in exercising his authority, especially in
fashioning an appropriate remedy.

5.1 Arbitrators Interpretation of CBA

It is said that an arbitral award does not draw its essence from
the CBA; hence, there is an unauthorized amendment or
alteration thereof, if:

1. It is so unfounded in reason and fact;

2. It is so unconnected with the working and purpose of the
agreement;

3. It is without factual support in view of its language, its
context, and any other indicia of the parties' intention;

4. It ignores or abandons the plain language of the contract;

5. It is mistakenly based on a crucial assumption which
concededly is a nonfact;

6. It is unlawful, arbitrary or capricious; and

7. It is contrary to public policy.
________

Article. 262-A. Procedures. - The Voluntary Arbitrator or
panel of Voluntary Arbitrators shall have the power to
hold hearings, receive evidences and take whatever
action is necessary to resolve the issue or issues subject
of the dispute, including efforts to effect a voluntary
settlement between parties.

All parties to the dispute shall be entitled to attend the
arbitration proceedings. The attendance of any third
party or the exclusion of any witness from the
proceedings shall be determined by the Voluntary
Arbitrator or panel of Voluntary Arbitrators. Hearing may
be adjourned for cause or upon agreement by the
parties.

Unless the parties agree otherwise, it shall be mandatory
for the Voluntary Arbitrator or panel of Voluntary
Arbitrators to render an award or decision within twenty
(20) calendar days from the date of submission of the
dispute to voluntary arbitration.

The award or decision of the Voluntary Arbitrator or
panel of Voluntary Arbitrators shall contain the facts and
the law on which it is based. It shall be final and
executory after ten (10) calendar days from receipt of
the copy of the award or decision by the parties.

Upon motion of any interested party, the Voluntary
Arbitrator or panel of Voluntary Arbitrators or the Labor
Arbiter in the region where the movant resides, in case
of the absence or incapacity of the Voluntary Arbitrator
or panel of Voluntary Arbitrators, for any reason, may
issue a writ of execution requiring either the sheriff of
the Commission or regular courts or any public official
whom the parties may designate in the submission
agreement to execute the final decision, order or award.
________

1. COMPLIANCE WITH DUTY TO ARBITRATE

If a CBA requires settlement of disputes exclusively by
the arbitration, then arbitration is needed before court
suits for breach of the contract may be filed.

LABOR RELATIONS
120 | P L A T O N
Nonetheless, the parties to a CBA may waive the
arbitration covenants of the agreement, but their
conduct must clearly show that intention.

2. WHO DETERMINES THE ARBITRATION PROCEDURES

In practice, voluntary arbitration of labor cases use
procedures based on the Labor Code as amended by RA
6715 and its Implementing Rules, the CBA, and other
agreements of the parties, the directives of the
arbitrator, and the procedural rules of appropriate
agencies like the NCMB Procedural Guidelines in Conduct
of Voluntary Arbitration Proceedings.

3. ETHICAL STANDARDS OF ARBITRATORS

An arbitrator is obliged to maintain a high level of
professional ethics in his relationship with the parties
and the appointing agencies. He also has a responsibility
to society. His conduct should be above reproach. Since
in effect, he is a judge, and his ethics must be on the
same high level as the code that governs the conduct of
judicial tribunals.

Failure on the part of the voluntary arbitrator to render a
decision, resolution, order or award within the prescribed
period, shall upon complaint of a party, be sufficient ground for
the Board to discipline said voluntary arbitrator, pursuant to
the guidelines issued by the Secretary. In cases that the
recommended sanction is de-listing, it shall be unlawful for the
voluntary arbitrator to refuse or fail to turn over to the board,
for its further disposition, the records of the case within ten
(10) calendar days from demand thereof.

4. VOLUNTARY ARBITRATION AWARD GENERALLY
FINAL; EXCEPTIONS

The decisions of voluntary arbitrators must be given the highest
respect and as a general rule must be accorded a certain
measure of finality. This is especially true where the arbitrator
chosen by the parties enjoys the first rate credentials. It is not
correct, however, that this respect precludes the exercise of
judicial review over their decisions.

Inspite of statutory provisions making 'final' the decisions of
certain administrative agencies, we have taken cognizance of
petitions questioning these decisions where want of
jurisdiction, grave abuse of discretion, violation of due process,
denial of substantial justice, or erroneous interpretation of the
law were brought to our attention.

A voluntary arbitrator by the nature of her fucntions acts in
quasi-judicial capacity. There is no reason why herdecisions
involving interpretation of law should be beyond this Court's
review. Administrative officials are presumed to act in
accordance with law and yet we do hesitate to pass upon their
work where a question of law is involved or where a showing of
abuse of authority or discretion in their official acts is properly
raised in petitions for certiorari.

The Labor Code and its Implementing Rules thus clearly
reflect the important public policy of encouraging
recourse to voluntary arbitration and of shortening the
arbitration process by rendering the arbitral award non-
appealable to the NLRC. The result is that a voluntary
arbitral award may be modified and set aside only upon
the same grounds on which a decision of the NLRC itself
may be modified or set aside, by the Supreme Court.

4.1 Motion for Reconsideration*

Section 7. Finality of Award/Decision. - The decision, order,
resolution or award of the voluntary arbitrator or panel of
voluntary arbitrators shall be final and executory after ten (10)
calendar days from receipt of the copy of the award or decision
by the parties and it shall not be subject of a motion for
reconsideration.

4.2 Review of Award by Certiorari

The voluntary arbitrator no less performs a state function
pursuant to a governmental power delegated to him under the
provisions therefor in the Labor Code and he falls, therefore,
within the contemplation of the term "instrumentality" in the
aforequoted Sec. 9 of B.P. 129. The fact that his functions and
powers are provided for in the Labor Code does not place him
within the exceptions to said Sec. 9 since he is a quasi-judicial
instrumentality as contemplated therein.

A fortiori, the decision or award of the voluntary arbitrator or
panel of arbitrators should likewise be appealable to the Court
of Appeals, in line with the procedure outlined in Revised
Administrative Circular No. 1-95, just like those of the quasi-
judicial agencies, boards and commissions enumerated therein.

In effect, this equates the award or decision of the voluntary
arbitrator with that of the regional trial court. Consequently, in
a petition for certiorari from that award or decision, the Court
of Appeals must be deemed to have concurrent jurisdiction
with the Supreme Court. As a matter of policy, this Court shall
henceforth remand to the Court of Appeals petitions of this
nature for proper disposition.

4.2a From VA to CA: Mode of Appeal is Rule 43, not 65

The mode of appeal from VA to the CA is therefore Rule 43 of
the 1997 Rules of Procedure. It is not Rule 65 because a
petition for certiorari under that Rule lies only where there is
no appeal and no plain, speedy and adequate remedy in the
ordinary course of law. Certiorari under Rule 65 cannot be
allowed when a party to a case fails to appeal a judgment
despite the availability of that remedy, certiorari not being a
substitute for lost appeal. The remedies of appeal and certiorari
are mutually exclusive and not alternative or successive.

4.3 Findings of Facts of a Voluntary Arbitrator
________

LABOR RELATIONS
121 | P L A T O N
Article. 262-B. Cost of voluntary arbitration and
Voluntary Arbitrators fee. - The parties to a Collective
Bargaining Agreement shall provide therein a
proportionate sharing scheme on the cost of voluntary
arbitration including the Voluntary Arbitrators fee. The
fixing of fee of Voluntary Arbitrators, whether
shouldered wholly by the parties or subsidized by the
Special Voluntary Arbitration Fund, shall take into
account the following factors:

(a) Nature of the case;

(b) Time consumed in hearing the case;

(c) Professional standing of the Voluntary Arbitrator;

(d) Capacity to pay of the parties; and

(e) Fees provided for in the Revised Rules of Court.
________

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