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Labor Rd5 Compiled

Labor Rd5 Compiled

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election. St. James argued that those who voted were not its regular employees but construction workers of an independent - The motor pool, construction and transportation employees of the Tandang Sora campus had 149 contractor, Architect Bacoy. qualified voters at the time of the certification Med-Arbiter Falconitin: the 84 voters were no longer working at election. Hence, the 149 qualified voters should be used St. James and that since the construction projects have ceased, to determine the existence of a quorum. Since a majority some of the workers were no longer entitled to vote in the or 84 out of the 149 qualified voters cast their votes, a certification election. Even if the 84 workers were to be included quorum existed in the certification election. in the 179 rank and file employees of St. James, the total number of voters would be 263. Thus, the 84 votes cast would not be sufficient to constitute a majority of all eligible voters to DISPOSITION Affirm CA Decision and Resolution. have a valid certification election. Petition denied. Samahang Manggagawa appealed to the Secretary of Labor. DOLE reversed the ruling of Med-Arbiter. CA dismissed the St. James¶ petition and MFR. ISSUES WON the formation of the labor union and the certification election were valid. HELD - YES. The 84 workers were employees of St. James and the Architect was only a labor-only contractor. The certification election is valid. (Section 13, Rule XII, Book V of the Omnibus Rules Implementing the Labor Code1). - St. James has five campuses. The members of Samahang Manggagawa are employees in the Tandang Sora campus. Under its constitution and by-laws, Samahang Manggagawa seeks to represent the motor pool, construction and transportation employees of the Tandang Sora campus. Thus, the computation of the quorum should be based on the rank and file motor pool, construction and transportation employees of the Tandang Sora campus and not on all the employees in St. James¶ five campuses.
Section 2, Rule XII, Book V of the Omnibus Rules provides: Section 2. Qualification of voters; inclusion-exclusion proceedings. ± All employees who are members of the appropriate bargaining unit sought to be represented by the petitioner at the time of the certification or consent election shall be qualified to vote. A dismissed employee whose dismissal is being contested in a pending case shall be allowed to vote in the election. In case of disagreement over the voters¶ list or over the eligibility of voters, all contested voters shall be allowed to vote. However, their votes shall be segregated and sealed in individual envelopes in accordance with Section 9 of these Rules.
1 Section 13. Proclamation and certification of results by election officer; when proper. ± Upon completion of the canvass there being a valid election, the election officer shall proclaim and certify as winner the union which obtained a majority of the valid votes cast under any of the following conditions:

Part 7 Collective bargaining

PROCESS, PROCEDURES AND ISSUES 7.01 GENERAL CONCEPTS 1. POLICY DECLARATION

ART XIII, 1987 CONSTITUTION
LABOR Section 3. The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all. It shall guarantee the rights of all workers to selforganization, collective bargaining and negotiations, and peaceful concerted activities, including the right to strike in accordance with law. They shall be entitled to security of tenure, humane conditions of work, and a living wage. They shall also participate in policy and decision-making processes affecting their rights and benefits as may be provided by law. The State shall promote the principle of shared responsibility between workers and employers and the preferential use of voluntary modes in settling disputes, including conciliation, and shall enforce their mutual compliance therewith to foster industrial peace. The State shall regulate the relations between workers and employers, recognizing the right of labor to its just share in the fruits of production and the right of enterprises to reasonable returns to investments, and to expansion and growth.

ART. 211. Declaration of Policy. - A. It is the policy of the State: a) No protest had been 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 of eligibility issue was raised or even if one was raised, the resolution of the same will not materially change the result. For this purpose, the election officer shall immediately issue the corresponding certification, copy furnished all parties, which shall form part of the records of the case. The winning union shall have the rights, privileges and obligations of a duly certified collective bargaining representative from the time the certification is issued. The proclamation and certification so issued shall not be appealable. (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;

KIOK LOY VS NLRC (PAMBANSANG KILUSAN NG PAGGAWA) 141 SCRA 179

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NATURE: Petition for certiorari to annul the decision of the National Labor Relations Commission FACTS: - In a certification election held on October 3, 1978, the Pambansang Kilusang Paggawa (Union for short) was subsequently certified in a resolution dated November 29, 1978 by the Bureau of Labor Relations as the sole and exclusive bargaining agent of the rank-and-file employees of Sweden Ice Cream Plant (Company for short). The Company's motion for reconsideration of the said resolution was denied on January 25, 1978. - December 7, 1978, the Union furnished the Company with two copies of its proposed collective bargaining agreement. It also requested the Company for its counter proposals. Both requests were ignored and remained unacted upon by the Company. - The Union, on February 14, 1979, filed a "Notice of Strike", with the Bureau of Labor Relations (BLR) on ground of unresolved economic issues in collective bargaining. - Conciliation proceedings then followed during the thirty-day statutory cooling-off period. - The Bureau of Labor Relations to certify the case to the National Labor Relations Commission for compulsory arbitration. - The labor arbiter set the initial hearing for April 29, 1979. For failure however, of the parties to submit their respective position papers as required, the said hearing was cancelled and reset to another date. - The Union submitted its position paper. - On July 20, 1979, the National Labor Relations Commission rendered its decision declaring the respondent guilty of unjustified refusal to bargain - Petitioner contends that the National Labor Relations Commission acted without or in excess of its jurisdiction or with grave abuse of discretion amounting to lack of jurisdiction in rendering the challenged decision. - Petitioner further contends that the National Labor Relations Commission's finding of unfair labor practice for refusal to bargain is not supported by law ISSUE/S: - WON the respondent is guilty of unjustified refusal to bargain HELD: YES unfair labor practice is committed when it is shown that the respondent employer, after having been served with a written bargaining proposal by the petitioning Union, did not even bother to submit an answer or reply to the said proposal Ratio Unfair labor practice is committed when it is shown that the respondent employer, after having been served with a written bargaining proposal by the petitioning Union, did not even bother to submit an answer or reply to the said proposal Reaspmomg Collective bargaining which is defined as negotiations towards a collective agreement, is one of the democratic frameworks under the New Labor Code, designed 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. So much so that Article 249, par. (g) 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 including proposals for adjusting any grievance or question arising under such an agreement and executing a contract incorporating such agreement, if requested by either party. 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 (3) a demand to bargain under Article 251, par. (a) of the New Labor Code . - From the over-all conduct of petitioner company in relation to the task of negotiation, there can be no doubt that the Union has a valid cause to complain against its (Company's) attitude, the totality of which is indicative of the latter's disregard of, and failure to live up to, what is enjoined by the Labor Code to bargain in good faith. DISPOSITION: Petition dismissed

2. NATURE AND PURPOSE
UNITED EMPLOYEES UNION OF GELMART INDUSTRIES V NORIEL 67 SCRA 267 FERNANDO; October 3, 1975
NATURE Petition for certiorari and prohibition FACTS - the petition seeks to have the certification election declared null and void, for it was held under circumstances that manifested lack of fairness - it was alleged that the petitioner-union was included, but under another name, in the list of contending unions in the election, where the winning party had 63% of the votes, while the petitioner only had 4.5% (thus, the winner won by a landslide, even if the votes of all the other 7 contending unions were combined. Therefore, the mistake didn¶t really affect the outcome of the election) ISSUE WON the certification election is void HELD NO Ratio Considering what transpired, it is apparent that the grievance spoken of is more fancied than real, the assertion of confusion and demoralization based on conjecture rather than reality. At most, it was an honest mistake Reasoning The institution of collective bargaining is a prime manifestation of industrial democracy at work. The two parties to the relationship, labor and management, make their own rules by coming to terms. That is to govern themselves in matters that really count. As labor, however, is composed of a number of individuals, it is indispensable that they be represented by a labor organization of their choice. Thus may be discerned how crucial a certification election is. - There must be an opportunity to determine which labor organization shall act on their behalf. It is precisely because respect must be accorded to the will of labor thus ascertained that a general allegation of duress is not sufficient to invalidate a certification election; it must be shown by competent and credible proof. That is to give substance to the principle of majority rule, one of the basic concepts of a democratic polity. Disposition Petition dismissed.

3. WAIVER
RIVERA V ESPIRITU G.R. No. 135547 QUISUMBING; January 23, 2002

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Nature Special civil action for certiorari and prohibition Facts

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and the exercised voluntary modes in settling disputes, including conciliation to foster industrial peace." Disposition petition is DISMISSED.

As a result of a three week strike staged by PAL pilots affiliated with the Airline Pilots Association of the Philippines (ALPAP) PAL which was already financially beleaguered suffered serious losses, PAL¶s financial situation went from bad to worse. Faced with bankruptcy, PAL adopted a rehabilitation plan and downsized its labor force by more than one-third. In protest to such action PALEA went on strike which when PAL and PALEA agreed to a more systematic reduction in PAL¶s work force and the payment of separation benefits to all retrenched employees. President Estrada thru AO 16 created an Inter-Agency Task Force to address the problems of PAL. PAL management submitted to the Task Force an offer by Lucio Tan, Chairman a plan to transfer shares of stock to its employees which has a provision regarding the suspension of the Collective Bargaining Agreements (CBAs) for 10 years. PALEA Members rejected the offer.Subsequently, PAL informed the Task Force that it was shutting down its operations because given its labor problems, rehabilitation was no longer feasible, and hence, the airline had no alternative but to close shop. PALEA sought the intervention of the Office of the President in immediately convening the parties, the PAL management, PALEA, ALPAP, and FASAP, including the SEC under the direction of the InterAgency Task Force, to prevent the imminent closure of PAL.After several negotiations a the questioned PAL- PALEA Agreement which provided for among others the suspension of the PAL-PALEA CBA for a period of ten (10) years, provided the certain safeguards are in place. Issue WON the PAL-PALEA agreement stipulating the suspension of the PALPALEA CBA unconstitutional and contrary to public policy Held No. A CBA is ³a 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.´ The primary purpose of a CBA is the stabilization of labor-management relations in order to create a climate of a sound and stable industrial peace. In construing a CBA, the courts must be practical and realistic and give due consideration to the context in which it is negotiated and the purpose which it is intended to serve. The assailed PAL-PALEA agreement was the result of voluntary collective bargaining negotiations undertaken in the light of the severe financial situation faced by the employer, with the peculiar and unique intention of not merely promoting industrial peace at PAL, but preventing the latter¶s closure. We find no conflict between said agreement and Article 253-A of the Labor Code. Article 253-A has a two-fold purpose. One is to promote industrial stability and predictability. Inasmuch as the agreement sought to promote industrial peace at PAL during its rehabilitation, said agreement satisfies the first purpose of Article 253-A. The other is to assign specific timetables wherein negotiations become a matter of right and requirement. Nothing in Article 253-A, prohibits the parties from waiving or suspending the mandatory timetables and agreeing on the remedies to enforce the same. In the instant case, it was PALEA, as the exclusive bargaining agent of PAL¶s ground employees, that voluntarily entered into the CBA with PAL. It was also PALEA that voluntarily opted for the 10-year suspension of the CBA. Either case was the union¶s exercise of its right to collective bargaining. The right to free collective bargaining, after all, includes the right to suspend it. The acts of public respondents in sanctioning the 10-year suspension of the PAL-PALEA CBA did not contravene the ³protection to labor´ policy of the Constitution. The agreement afforded full protection to labor; promoted the shared responsibility between workers and employers;

7.02 BARGAINING PROCEDURE 1. PRIVATE PROCEDURE-251 2. CODE PROCEDURE-250ART. 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.

251;233

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).

NATURE OF PROCEDURE
ASSOCIATED LABOR UNIONS (ALU) vs. FERRER-CALLEJA 173 SCRA 178 Regalado; May 5, 1989

ART. 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 A2010 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.

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- 156NATURE Petition for certiorari

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FACTS - On January 4, 1960, the petitioner entered into a contract with the Marine Security Agency for the latter to guard and protect the petitioner's vessels while they were moored at the port of Manila. It was stipulated in the contract that its term was for one year commencing from the date of its execution and it may be terminated by either party 30 days' notice to the other. The relationship between the petitioner and Marine Security Agency is such that it was the latter who hired and assigned the guards TAKE NOTE: These procedures (A250-251) are who kept watching over the petitioner's vessels. The guards DIRECTORY in nature and not mandatory, failure to comply were not known to petitioner who dealt only with the agency on with the prescribed time periods will not amount to an unfair matters pertaining to the service of the guards. A lump sum labor practice. would be paid by petitioner to the agency who in turn determined and paid the compensation of the individual watchmen. FACTS - Upon prior notice given by the petitioner to the Marine Security - ALU, through a letter dated May 7, 1986, informed GAW Trading, Inc. Agency, the contract was terminated on January 4, 1961, after it that majority of the latter's employees have authorized ALU to be their had run its term. After the termination of its contract with Marine sole and exclusive bargaining agent (SEBA), and requested a Security Agency, the petitioner executed a new contract with the conference with GAW for the execution of an initial Collective Bargaining Philippine Scout Veterans Security and Investigation Agency Agreement (CBA). ALU received a letter dated May 12th from GAW, also for the purpose of having its vessels protected while they which letter set the meeting on the same date. The following day, May called at the port of Manila, and this contract was also for a fixed 13th, ALU transmitted to GAW copies of the proposed CBA. 2 days period of one year. later, ALU and GAW executed the CBA. In the meantime, on May 9th, - private respondents protested against the termination 2 unions in the company went on strike. - On February 6, 1961, the respondent Union passed a resolution abolishing itself with the following reasons: - After the signing of the CBA, one of the striking unions filed a petition 1. Termination of Contract of the Marine Security Agency with for certification election, which petition was eventually granted by the the American President Lines. Bureau of Labor Relations. Hence the present action by ALU, which 2. Inability of the Marine Security Agency to provide employment invokes the CBA it made with GAW and, thus, the applicability of the 3. Inability of the members and the Union to provide contract bar rule. maintenance in the coming months. - On December 10, 1962, the respondent union passed another ISSUE WON the contract bar rule applies resolution reviving itself. - On March 21, 1963, the Maritime Security Union, through HELD NO. The subject CBA is defective. private respondents filed a complaint against the petitioner for 2 RATIO: unfair labor practice under RA 875. Their complaint, wherein - The mechanics of collective bargaining are set in motion only they charged that the petitioner had refused to negotiate an when the following jurisdictional preconditions are present, namely, agreement with them and had discriminated against them with (1) possession of the status of majority representation by the regard to their tenure of employment by dismissing them for no employees' representative; (2) proof of majority representation; other reason than their membership with the union and union and (3) a demand to bargain. The standing of ALU as SEBA is dubious, activities, was lodged with the defunct Court of Industrial to say the least. The only express recognition of ALU as SEBA in the Relations. However, before that court could resolve the case, the records is in the CBA. There was precipitate haste on the part of GAW in Labor Code was enacted and the case was transferred to the recognizing ALU, which recognition appears to have been based on the NLRC under Arbiter Lomabao. self-serving claim of ALU that it had the support of the majority of the - Arbiter Lomabao found the petitioner to be an employer of the employees in the bargaining unit. Furthermore, at the time of the private respondents and guilty of ULP against them. supposed recognition, GAW was obviously aware that there were other - The NLRC affirmed with the qualification that only those unions existing in the unit. complainants who are 60 years old or younger and capacitated to discharge their former duties should be reinstated without loss There was also failure to post the CBA in conspicuous places in the of seniority rights and other privileges, and with three years of establishment before its ratification, as required by the implementing backwages; and those who could not be so reinstated should be rules of the Labor Code. Also, BLR found that about 64% of the workers given separation pay in addition to their backwages for three who "ratified" the CBA now strongly repudiate the alleged negotiation years. The Minister of Labor affirmed, and the Office of the and ratification of the CBA. President affirmed as well. ART. 233. Privileged communication. - Information and statements made at conciliation proceedings shall be treated as privileged communication and shall not be used as evidence in the Commission. Conciliators and similar officials shall not testify in any court or body regarding any matters taken up at conciliation proceedings conducted by them.

CALTEX v. BRILLANTES 279 SCRA 218 (Mel Sicat) AMERICAN PRESIDENT LINES VS CLAVE 114 SCRA 826 BARREDO; June 29, 1982
2

ISSUES 1. WON there existed an employer-employee relationship between the petitioner and the individual watchmen of the Marine Security Agency who are alleged to be members of the respondent union. 2. WON the petitioner refused to negotiate a CBA with the said individual watchmen and discriminated against them in respect to their tenure of employment by terminating their contract on January 1, 1961, because of their union activities (an unfair labor practice). HELD 1. NO. Ratio The following elements are generally considered to determine whether an employer-employee relationship exists: (1)

In relation to the topic, what this case is saying seems to be that the bargaining procedure is JURISDICTIONAL in nature. If the requisites are not followed, the resulting CBA is defective. Accordingly, the proper adjudicative body has no jurisdiction over the CBA, when the purported SEBA seeks the agency¶s quasi-judicial function to enforce the res (CBA). Obviously, the agency has no business deciding whether the contract bar rule applies in favor of the (defective) CBA.

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the selection and engagement of the employee; (2) the payment of wages; (3) the power of dismissal; and (4) the power to control the employee's conduct-although the latter is the most important element. Reasoning In the present case, it is the agency that recruits, hires, and assigns the work of its watchmen. Hence, a watchman can not perform any security service for the petitioner's vessels unless the agency first accepts him as its watchman. With respect to his wages, the amount to be paid to a security guard is beyond the power of the petitioner to determine. Certainly, the lump sum amount paid by the petitioner to the agency in consideration of the latter's service is much more than the wages of any one watchman. In point of fact, it is the agency that quantifies and pays the wages to which a watchman is entitled. Neither does the petitioner have any power to dismiss the security guards. Since the petitioner has to deal with the agency, and not the individual watchmen, on matters pertaining to the contracted task, it stands to reason that the petitioner does not exercise any power over the watchmen's conduct. Always, the agency stands between the petitioner and the watchmen; and it is the agency that is answerable to the petitioner for the conduct of its guards. 2. NO. Ratio In view of Our finding that there is no employer-employee relationship between the petitioner and the members of the respondent agency, it should necessarily follow that the petitioner cannot be guilty of unfair labor practice as charged by the private respondents. Under RA 975 Sec.13, an unfair labor practice may be committed only within the context of an employer-employee relationship. - We find it difficult to believe that the members of the respondent agency made "repeated requests" upon the petitioner through its Captain Morris to negotiate a CBA with the respondent union. Apart from their oral declaration, the private respondents have not presented any written proof that such requests were made. Under RA 875, Sec.14(a), the desire to negotiate an agreement should be expressed through a written notice. At the time the members of the agency were allegedly presenting "repeated requests" for negotiation, they were represented by counsel. If such requests were in fact made, counsel would not have failed to advise his clients to tender their requests in the manner required by law. With regard to the termination of the contract between the petitioner and the respondent agency, We find no evidence, that it bears any relationship to the alleged union activities of the individual members of the agency. The hard fact is that the contract had a lifetime of one year. Hence, after that period, and without it being renewed, it lived out its term. While the expiration of the contract might have rendered the members of the respondent agency jobless, it can hardly be attributed to any adverse act by the petitioner. Disposition WHEREFORE the complaint for unfair labor practice against petitioner is hereby dismissed. SEPARATE OPINIONS AQUINO, Concurring: I concur in the result. The watchmen were employees of the American President Lines while guarding the ships. Since the watchmen were hired only for a period of one year, they ceased, after that period, to be employees of the APL. APL was not obligated to renew the contract of employment. Hence, the non-renewal of their employment and the act of the American President Lines in hiring the watchmen of another security agency cannot be regarded as an unfair labor practice. Moreover, the watchmen in filing their complaint for unfair labor practice and reinstatement only two years and two months after the expiration of their employments contract were guilty of laches. ABAD SANTOS, Dissenting: - The pivotal question in this case is one of fact, i.e. whether or not there existed an employer-employee relationship between the APL and the individual complainants. The Executive Department of the government starting from the Labor Arbiter, to the NLRC, the Minister of Labor and finally the Office of the President found as a fact that there was an employer-employee relationship. This finding of fact is supported by substantial evidence: "evidence on record undisputably shows that private respondents became employees of the APL when they were hired much earlier even before 1961 after they had been recruited by the Marine Security

Agency for the said shipping company who then hired them to perform guarding duties over its vessels on dock in the Manila ports. This arrangement became the practice starting the early part of 1951 to evade the preferential hiring of union men and the maintenance of the rates of pay then obtaining. This arrangement gave birth to the Marine Security Agency which was contracted for the sole purpose of recruiting and supplying watchmen on ships and vessels of the American President Lines. It was also observed that the Marine Security Agency which had recruited herein private respondents for the said shipping company was not an 'independent contractor' but a 'mere agent which served as extension of the office' of the said shipping company 'in the recruitment of the watchmen, the computation of the watchmen's wages; and the placement of supervisors of the watchmen.' These reveal that a certain degree of control exercised by the shipping company over these watchmen. The services of these watchmen were availed of and their compensation paid in lump sum by the shipping company through the watchmen's agency, even if such were done through the said watchmen agency without the direct intervention of the said shipping company. While working as regular employees of APL, private respondents herein formed and organized on August 3, 1958 the Maritime Security Union. The foregoing factors or indicia demonstrate that employer-employee relationship existed between APL and herein private respondents, - On the question as to whether or not the APL is guilty of unfair labor practice, it suffices to quote from the decision of the Office of the President, thus: "This Office also found that there was indeed an unfair labor practice committed by the respondent-appellant. The evidence indubitably show that the repeated requests of members of the complainant union to negotiate in behalf of the union with Capt. Edward Morris were unheeded. As such, refusal to negotiate and eventually separating individual complaints are, to our mind, acts constituting unfair labor practice."

NATIONAL UNION OF RESTAURANT WORKERS V CIR 10 SCRA 843 BAUTISTA ANGELO; APR.30, 1964
NATURE PETITION for review by certiorari of a resolution of the Court of Industrial Relations. FACTS - On June 9, 1960, a complaint for unfair labor practice was lodged against the owners of Tres Hermanas Restaurant, particularly Mrs. Felisa Herrera, on the ground, among others, that respondents refused to bargain collectively with the complaining union; respondents made a counter-proposal in the sense that they would bargain with said union and would accept its demands if the same would become a company union, and one Martin Briones, an employee, was separated from the service because he was found to be the organizer and adviser of the complaining union. - Responents denied the charges, and they were exonerated. The judge found that the charges were not proven and dismissed the complaint. ISSUES 1. WON respondents refused to bargain collectively with the union and committed unfair labor practice 2. WON respondents interfered, coerced or restrained their employees in the exercise of their right to join the complaining union 3. WON respondents dismissed said employee because he was found to be the organizer and adviser of the complaining union.

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HELD 1. NO Reasoning The court cited several instances that showed respondent¶s willingness to bargain with the union. It is true that under Sec 14, RA 875 whenever a party serves a written notice upon the employer making some demands the latter shall reply thereto not later than 10 days from receipt thereof, but this condition is merely procedural, and as much its non-compliance cannot be deemed to be an act of unfair labor practice. The fact is respondents did not ignore the letter sent by the union so much so that they called a meeting to discuss its demands. The court also pointed out the markings on the letter made by respondent in the meeting with the union on May 3, 1960 at their restaurant in Quezon City, indicating the willingness and actual bargaining made with the union. (Check for agreement, a cross for disapproval and a circle for demands left open for further discussion) It is contended that respondents refused to bargain with the complaining union as such even if they called a meeting of its officers and employees hereby concluding that they did not desire to enter into a bargaining agreement with said union. It is belied by the fact that respondents did actually agree and bargain with the representatives of the union. Respondents were of the impression that before a union could have that capacity it must first be certified by the CIR as the duly authorized bargaining unit, which they also stated in their answer to the petition for certification filed by said union before the CIR. In that case, another union known as the International Labor and Marine Union of the Philippines claimed to represent the majority of the employees of respondent restaurant, and this is what it alleged in a letter sent to the manager of respondents dated May 25, 1962. 2. NO. Reasoning On this document certain notations were made by one Ernesto Tan which are indeed derogatory and which were allegedly made by him upon instructions of respondent Felisa Herrera. Thus, the pertinent notation on which the union relies is one which states that respondent Herrera would be willing to recognize the union "if union would become company union", which would indeed show that Mrs. Herrera interfered with the employees' right to self-organization. But respondents denied that they ever authorized Ernesto Tan to make such notation or to represent them in the negotiations. Although Tan was the nephew of respondent Herrera, in the company, he was merely a bookkeeper whose duties were confined to the keeping and examination of their books of accounts and sales invoices. It appears that he was not even invited to the meeting but merely volunteered to be present and made those notations on his own account and initiative. 3. NO. Reasoning. Respondents maintain that Briones was dismissed because of the ³smouldering embers of hatred´ that Briones had against Mrs. Herrera, the threats he made, and her fear for her own safety being always together with in her car driven by Briones during business routine. Petitioners maintain that Briones was dismissed because of his union activities. It appears in Briones¶ testimony that he is not the only one who organized the union, yet the members who are more active in the union and serve as its officers are still employed at the restaurant. Disposition CIR decision AFFIRMED.

- On Dec 1992, Salvador Abtria, then President of respondent union, initiated the renegotiation of its CBA with petitioner for the last 2 years of the 5 year lifetime from 1989-1994. On the same year, the union elected a new set of officers, with Eleanor Ambas as new president. - Ambas wanted to continue the renegotiation of the CBA but petitioner, through Fr. Edwin Lao, claimed that the CBA was already prepared for signing by the parties. The parties submitted the disputed CBA to a referendum by the union members, who eventually rejected the said CBA. - Petitioner accused the union officers of bargaining in bad faith before the NLRC. The labor arbiter ruled in favor of petitioner, but was reversed on appeal before the NLRC. - On Jan 1996, the union notified the National Conciliation and Mediation Board of its intention to strike. - On Jan 18, 1996 the parties agreed to disregard the unsigned CBA and to start negotiation on a new 5 year CBA starting 19941999. On Feb 7, 1996, the union submitted its proposals to petitioner, which notified the union 6 days later that it has been submitted to its Board of Trustees. - Ambas was informed through a letter dated Feb 15, 1996 that her work schedule was being changed from Mon-Fri to Tue-Sat. Ambas protested and requested management to submit the issue to a grievance machinery under the old CBA. - Due to petitioner¶s inaction, the union filed a notice of strike on Mar 13, 1996. On Mar 29, the union received petitioner¶s letter dismissing Ambas for alleged insubordination. The union amended the notice of strike to include Ambas¶ dismissal. - On Apr 20 1996, both parties again discussed the ground rules for the CBA negotiations. However, petitioner stopped the negotiations after it purportedly received information that a new group of employees had filed a certification election. - On June 18, 1996, the union finally struck. On July 2, the Sec of Labor assumed jurisdiction and ordered all striking employees including the union president to return to work and for petitioner to accept them back under the same terms and conditions before the actual strike. Petitioner readmitted the striking members except Ambas. - On Dec 2, 1996, the Sec of Labor issued an order declaring petitioner guilty of unfair labor practice on two counts and directing the reinstatement of Ambas, with backwages. - Petitioner¶s MFR was denied, so it sought a review before the CA, which dismissed the petition and affirmed the findings of the Sec of Labor. Issues: 1. WON petitioner is guilty of unfair labor practice by refusing to bargain with the union when it unilaterally suspended the ongoing negotiations for a new CBA upon mere information that a petition for certification has been filed by another legitimate labor organization 2. WON the termination of the union president amounts to an interference of the employees¶ right to self-organization Held: 1. YES - Article 252 of the Labor Code defines the meaning of the phrase ³duty to bargain collectively´. Article 252. Meaning of duty to bargain collectively. ± The duty to bargain collectively means the performance of 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. - There is a requirement on both parties of the performance of the mutual obligation to meet and convene promptly and expeditiously in good faith for the purpose of negotiating an

COLEGIO DE SAN JUAN DE LETRAN v ASSOCIATION OF EMPLOYEES AND FACULTY OF LETRAN 340 SCRA 587 KAPUNAN; Sept 18, 2000
Nature: Petition for review on certiorari Facts:

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agreement. The union lived up to its requisite when it presented its proposals for the CBA to petitioner. On the other hand, petitioner devised ways and means in order to prevent the negotiation. - Petitioner¶s utter lack of interest in bargaining with the union is obvious in its failure to make a timely reply to the proposals presented by the union. This is a clear violation of Article 250 of the Labor Code Article 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. Xxx - Petitioner claims that the suspension of negotiations was proper since by the filing of the petition for certification of election the issue on majority representation of the employees arose. Court held that in order to allow the employer to validly suspend the bargaining process there must be a valid petition for certification election raising a legitimate representation issue. Hence, the mere filing of a petition for certification election does not ipso facto justify the suspension of negotiation by the employer. The petition must first comply with the provisions of the Labor Code and its Implementing Rules. Foremost is that a petition for certification election must be filed during the sixty-day freedom period. 2. YES While the Court recognizes the right of the employer to terminate the services of an employee for a just or authorized cause, nevertheless, the dismissal of employees must be made within the parameters of law and pursuant to the tenets of equity and fair play. Disposition Petition denied

The draft proposal for a CBA was found to be reasonable under the premises, and declared to be the collective agreement w/c should govern the relationship between the parties. -Petitioner: «its right to procedural due process has been violated when it was precluded from presenting further evidence in support of its stand and when its request for further postponement was denied. «that the NLRC¶s finding of unfair labor practice for refusal to bargain is not supported by law and the evidence considering that it was only on May 24. 1979 when the Union furnished them with a copy of the proposed CBA and it was only then that they came to know of the Union's demands; « that CBA approved and adopted by the NLRC is unreasonable and lacks legal basis. ISSUE/S 1) WON company¶s right to due process has been violated 2) WON company is guilty of ULP 3) WON CBA is reasonable HELD 1) NO -Considering the various postponements granted in its behalf, the claimed denial of due process appeared totally bereft of any legal and factual support. As herein earlier stated, petitioner had not even honored respondent union with any reply to the latter's successive letters, all geared towards bringing the Company to the bargaining table.. Certainly, the moves and overall behavior of company were in total derogation of the policy enshrined in the Labor Code which is aimed towards expediting settlement of economic disputes. Hence, the Court is not prepared to affix its imprimatur to such an illegal scheme and dubious maneuvers. 2) YES - Article 249, par. (g) LC 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 including proposals for adjusting any grievance or question arising under such an agreement and executing a contract incorporating such agreement, if requested by either party." -Collective bargaining which is defined as negotiations towards a collective agreement, is designed 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. - 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 ff. 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 LC; (2) proof of majority representation; and (3) a demand to bargain under Art 251, par. (a) of the Labor Code . . . all of which preconditions are undisputedly present in the instant case.

KIOK LOY (SWEDEN ICE CREAM PLANT) V NLRC, KILUSAN G.R. No. L-54334 CUEVAS; JAN 22 1986
NATURE Petition for CERTIORARI to annul the decision ofNLRC (w/c found petitioner guilty of ULP for unjustified refusal to bargain, in violation of par. (g) of Article 249 Labor Code, and declared the draft proposal of the KILUSAN for a collective bargaining agreement as the governing CBA bet the EEs and the mgt. FACTS - Pambansang Kilusan ng Paggawa (Kilusan), a legitimate labor federation, won cert election and was certified by the BLR as the sole and exclusive bargaining agent of the rank-and-file employees of Sweden Ice Cream Plant (Company). - Kilusan then gave the Company two copies of its proposed CBA. It requested the Company for its counter proposals. There was no response from Company. Kilusan again requested the Company for collective bargaining negotiations and for the Company to furnish them with its counter proposals. Both requests were ignored and remained unacted upon by the Company. -Kilusan on Feb 14, 1979, filed a "Notice of Strike", with the BLR on ground of unresolved economic issues in collective bargaining. -Conciliation proceedings followed but all attempts towards an amicable settlement failed. BLR certified the case to the NLRC for compulsory arbitration. The case was reset/postponed several times (mostly Company¶s ³request´). -Then in the scheduled hearing on June 4, 1979, the Company's representative, Mr. Ching, who was supposed to be examined, failed to appear. The Company¶s counsel requested for another postponement. The labor arbiter denied. He ruled that the Company has waived its right to present further evidence and, therefore, considered the case submitted for resolution. - NLRC held: Sweden Ice Cream guilty of unjustified refusal to bargain.

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-From the over-all conduct of petitioner company, Kilusan has a valid cause to complain against Company's attitude, the totality of which is indicative of the latter's disregard of, and failure to live up to, what is enjoined by the Labor Code ---- to bargain in good faith. -Company is GUILTY of unfair labor practice. (1) respondent Union was a duly certified bargaining agent; (2) it made a definite request to bargain, accompanied with a copy of the proposed CBA, to the Company not only once but twice which were left unanswered and unacted upon; and (3) the Company made no counter proposal whatsoever all of which conclusively indicate lack of a sincere desire to negotiate. Even during the period of compulsory arbitration before the NLRC, Company's stalled the negotiation by a series of postponements, non-appearance at the hearing conducted -Herald Delivery Carriers Union (PAFLU) vs. Herald Publications: "unfair labor practice is committed when it is shown that the respondent employer, after having been served with a written bargaining proposal by the petitioning Union, did not even bother to submit an answer or reply to the said proposal. This doctrine was reiterated in Bradman vs. CIR: "while the law does not compel the parties to reach an agreement, it does contemplate that both parties will approach the negotiation with an open mind and make a reasonable effort to reach a common ground of agreement". 3) YES - The instant case being a certified one, it must be resolved by the NLRC pursuant to the mandate of P.D. 873, as amended, which authorizes the said body to determine the reasonableness of the terms and conditions of employment embodied in any CBA. To that extent, utmost deference to its findings of reasonableness of any Collective Bargaining Agreement as the governing agreement by the employees and management must be accorded due respect by this Court.

Art. 233 Privileged communication. Information and statements made at conciliation proceedings shall be treated as privileged communication and shall not be used as evidence in the Commission. Conciliators and similar officials shall not testify in any court or body regarding any matters taken up at conciliation proceedings conducted by them. Art.250 (e) says that: The Board shall exert all efforts to settle disputes amicably and encourage the parties to submit their case to a voluntary arbitrator. How does the law encourage the parties to go into conciliation? Privileged Communication (Art. 233) a. Information and statements made at conciliation proceedings shall be treated as privileged communication and shall not be used as evidence in the Commission. b. Conciliators and similar officials shall not testify in any court or body regarding any matters taken up at conciliation proceedings conducted by them. 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; (Art. 250 c). This power to subpoena is merely to force the parties to participate. 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; (Art. 250d)

Disposition Petition dismissed.

GARCIA; October 31, 2006

3. CONCILIATION PROCEDURE-250 (C, D,E); 233
Art. 250 Procedure in collective bargaining. 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

FACTS - A 2000-2001 labor dispute between Nissan Motors Philippines, Inc. (Nissan Motors) and the union BANAL-NMPI-OLALIA-KMU triggered by a collective bargaining deadlock resulted in the filing of four notices of strike and the dismissal from the service of a number of company employees. - August 22, 2001 ± DOLE issued an order assuming jurisdiction over the case. In the same order, the DOLE Secretary expressly enjoined any strike or lockout and directed the parties to cease and desist from committing any act that might aggravate the situation. It also ordered the Union to refrain from engaging in any disruptive activity. - December 5, 2001 ± The DOLE secretary issued a decision which contained names of union officers and members whom Nissan Motors dismissed for defying the directives contained in the assumption order. The order can be summarized as follows: - That the suspension of 140 employees is affirmed and the dismissal of the union officers is sustained. - But the dismissal of the union members was recalled and it ordered for the reinstatement of the employees/union members without backwages. They were to be imposed a 1-month suspension which was to be deemed served already.

NISSAN MOTORS V SECRETARY OF DOLE 491 SCRA 605

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- January 22, 2002 ± The DOLE affirmed with modification the December resolution. The modification consisted of deleting from the list of union officers three employees. - February 7, 2003 ± The CA, acting on petitions filed by Nissan Motors and the union, affirmed the DOLE decision. - June 21, 2006 ± The SC affirmed that of the CA insofar as it upheld the DOLE Secretary on the suspension and dismissal angle of her decision which included the following: (a) affirming the suspension of the 140 employees which is the subject of the first notice of strike; (b) sustaining the dismissal of the Union officers; and (c) downgrading the penalty of dismissal to a 1-month suspension to be imposed on Union members who joined the striking Union officers in defying the assumption order and accordingly reinstating said union members having already served the 1-month suspension. - In the present case, the Union seeks clarification on who among the union members were ordered reinstated, pursuant to the affirmed decision of the DOLE, considering that the Court¶s Decision failed to mention the names of such union members ordered reinstated after their dismissal was recalled. ISSUE WON the decision of the DOLE secretary was correct HELD YES Reasoning - The workers engaged in illegal strike which rightly led to the company dismissing them in accordance with A264(a). - The members of the Union should not be as severely punished. Dismissal is a harsh penalty as surely they were only following orders from their officers. - There is no evidence that they engaged or participated in the commission of illegal activities during the said strike. They should thus be reinstated to their former positions, but without backwages. Disposition Judgment affirmed

7.03 DUTY TO BARGAIN- 250-253; 242 (C)
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).

ART. 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. ART. 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. ART. 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). ART. 242. Rights of legitimate labor organizations. - A legitimate labor organization shall have the right: (c) To be furnished by the employer, upon written request, with its annual audited financial statements, including the balance sheet and the profit and loss statement, within thirty (30) calendar days from the date of receipt of the request, after the union has been duly recognized by the employer or certified as the sole and exclusive bargaining representative of the employees in the bargaining unit, or within sixty (60) calendar days before the expiration of the existing collective bargaining agreement, or during the collective bargaining negotiation

;

MEANING OF DUTY STANDARD CHARTERED BANK EMPLOYEES UNION V CONFESOR 432 SCRA 308 CALLEJO; June 16, 2004
FACTS - Standard Chartered Bank is a foreign banking corporation doing business in the Philippines. The exclusive bargaining agent of the rank and file employees of the Bank is the Standard Chartered Bank Employees Union - The Union sought to renegotiate the terms of the CBA and initiated the negotiations. - Through its President, Eddie L. Divinagracia, it sent a letter containing its proposals covering political and economic provisions.

ART. 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.

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- The Bank, took note of the Union¶s proposals. The Bank attached its counter-proposal to the non-economic provisions proposed by the Union. - Before the commencement of the negotiation, the Union, through Divinagracia, suggested to the Bank¶s Human Resource Manager and head of the negotiating panel, Cielito Diokno, that the bank lawyers should be excluded from the negotiating team. The Bank acceded. - Meanwhile, Diokno suggested to Divinagracia that Jose P. Umali, Jr., the President of the National Union of Bank Employees (NUBE), the federation to which the Union was affiliated, be excluded from the Union¶s negotiating panel. However, Umali was retained as a member thereof. - The parties met and set the ground rules for the negotiation. Diokno suggested that the negotiation be kept a ³family affair.´ - Even during the final reading of the, there were still non-economic provisions on which the Union and the Bank could not agree. Both parties agreed to place the notation ³DEFERRED/DEADLOCKED.´ - The negotiation for economic provisions commenced. Except for the provisions on signing bonus and uniforms, the Union and the Bank failed to agree on the remaining economic provisions of the CBA. The Union declared a deadlock and filed a Notice of Strike before the National Conciliation and Mediation Board - The Bank filed a complaint for Unfair Labor Practice (ULP) and Damages before the NLRC in Manila alleging that the Union violated its duty to bargain, as it did not bargain in good faith. It contended that the Union demanded ³sky high economic demands,´ indicative of blue-sky bargaining. - Then Secretary of Labor and Employment (SOLE) Nieves R. Confesor, assumed jurisdiction over the labor dispute and issued an Order dismissing the Bank and the Union¶s charges for unfair labor practice - The Union filed a motion for reconsideration with clarification, while the Bank filed a motion for reconsideration. The SOLE issued a Resolution denying the motions. The Union filed a second motion for reconsideration, which was, likewise, denied - The Union filed this petition - The Union alleges that the Bank violated its duty to bargain; hence, committed ULP under Article 248(g) when it engaged in surface bargaining. It alleged that the Bank just went through the motions of bargaining without any intent of reaching an agreement, as evident in the Bank¶s counter-proposals. ISSUE WON the SOLE committed grave abuse of discretion amounting to lack of jurisdiction in dismissing the union¶s charge of unfair labor practice. HELD NO. - Surface bargaining: ³going 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 party¶s conduct both at and away from the bargaining table. It involves the question of whether an employer¶s conduct demonstrates an unwillingness to bargain in good faith or is merely hard bargaining. - The minutes of meetings do not show that the Bank had any intention of violating its duty to bargain with the Union. Records show that after the Union sent its proposal to the Bank, the latter replied with a list of its counter-proposals. Thereafter, meetings were set for the settlement of their differences. The minutes of the meetings show that both the Bank and the Union exchanged economic and non-economic proposals and counter-proposals. - The Union has not been able to show that the Bank had done acts, both at and away from the bargaining table, which tend to show that it did not want to reach an agreement with the Union or to settle the differences between it and the Union. Admittedly, the parties were not able to agree and reached a deadlock. However, it is herein emphasized that the duty to bargain ³does not compel either party to agree to a proposal or require the making of a concession.´ Hence, the parties¶ failure to agree did not amount to ULP under Article 248(g) for violation of the duty to bargain.

- The inference that respondents did not refuse to bargain collectively with the complaining union because they accepted some of the demands while they refused the others even leaving open other demands for future discussion is correct, especially so when those demands were discussed at a meeting called by respondents themselves precisely in view of the letter sent by the union - The Court also does not agree that the Union is guilty of ULP for engaging in blue-sky bargaining or making exaggerated or unreasonable proposals. - The Bank failed to show that the economic demands made by the Union were exaggerated or unreasonable. The minutes of the meeting show that the Union based its economic proposals on data of rank and file employees and the prevailing economic benefits received by bank employees from other foreign banks doing business in the Philippines and other branches of the Bank in the Asian region. Disposition Resolutions of the SOLE are AFFIRMED.

UNION OF FILIPRO EMPLOYEES (UFE-DFAKMU) V NESTLÉ PHILIPPINES, INC. 499 SCRA 521 CHICO-NAZARIO; August 22, 2006
FACTS - Due to the impending expiration of the existing collective bargaining agreement (CBA) between Nestlé and UFE-DFAKMU, the Presidents of the Alabang and Cabuyao Divisions of UFE-DFA-KMU, informed Nestlé of their intent to ³open our new Collective Bargaining Negotiation for the year 2001-2004 x x x as early as June 2001.´ - Nestlé acknowledged receipt of the aforementioned letter. It also informed UFE-DFA-KMU that it was preparing its own counter-proposal and proposed ground rules that shall govern the conduct of the collective bargaining negotiations. - Nestlé underscored its position that ³unilateral grants, one-time company grants, company-initiated policies and programs, which include, but are not limited to the Retirement Plan, Incidental Straight Duty Pay and Calling Pay Premium, are by their very nature not proper subjects of CBA negotiations and therefore shall be excluded therefrom.´ - In addition, it clarified that with the closure of the Alabang Plant, the CBA negotiations will only be applicable to the covered employees of the Cabuyao Plant; hence, the Cabuyao Division of UFE-DFA-KMU became the sole bargaining unit involved in the subject CBA negotiations. - Thereafter, dialogue between the company and the union ensued. - Nestlé, claiming to have reached an impasse in said dialogue, requested the National Conciliation and Mediation Board to conduct preventive mediation proceedings between it and UFEDFA-KMU. - Conciliation proceedings nevertheless proved ineffective. Complaining, in essence, of bargaining deadlock ± pertaining to economic issues, i.e., ³retirement (plan), panel composition, costs and attendance, and CBA,´ UFE-DFA-KMU filed a Notice of Strike . - One week later, another Notice of Strike was filed by the UFEDFA-KMU, this time predicated on Nestlé¶s alleged unfair labor practices i.e., bargaining in bad faith in that it was setting preconditions in the ground rules by refusing to include the issue of the Retirement Plan in the CBA negotiations. - In view of the looming strike, Nestlé filed with the DOLE a Petition for Assumption of Jurisdiction - Sto. Tomas issued an Order assuming jurisdiction over the subject labor dispute between the parties stating that any strike or lockout is enjoined, that the parties are further directed to meet and convene for the discussion of the union proposals and company counter-proposals before the National Conciliation and Mediation Board and that if no settlement of all the issues is

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reached, the Office shall define the outstanding issues and order the filing of position papers for a ruling on the merits. - UFE-DFA-KMU sought reconsideration of the Assumption of Jurisdiction Order - In an Order, Sec. Sto. Tomas denied the aforequoted motion for reconsideration - The employee members of UFE-DFA-KMU at the Nestlé Cabuyao Plant went on strike. - Notwithstanding a Return-To-Work Order, the members of UFE-DFAKMU continued with their strike and refused to go back to work as instructed. Thus, Sec. Sto. Tomas sought the assistance of the Philippine National Police (PNP) for the enforcement of said order. - At the hearing called, Nestlé and UFE-DFA-KMU filed their respective position papers. - Tomas denied the motion for reconsideration of UFE-DFA-KMU. - Frustrated with the foregoing turn of events, UFE-DFA-KMU filed a petition for certiorari with application for the issuance of a temporary restraining order or a writ of preliminary injunction before the Court of Appeals. - Meanwhile, in an attempt to finally resolve the crippling labor dispute between the parties, then Acting Secretary of the DOLE, Hon. Arturo D. Brion, came out with an Order - UFE-DFA-KMU moved to reconsider the aforequoted position of the DOLE. - Secretary of the DOLE, Hon. Sto. Tomas, issued the last of the assailed Orders. This order resolved to deny the preceding motion for reconsideration of UFE-DFA-KMU. - Undaunted still, UFE-DFA-KMU, for the second time, went to the Court of Appeals - The Court of Appeals, acting on the twin petitions for certiorari, determined the issues in favor of UFE-DFA-KMU - Dissatisfied, both parties separately moved for the reconsideration of the abovequoted decision - The Court of Appeals stood pat in its earlier pronouncements and denied the motions for reconsideration ISSUES 1. WON the Retirement Plan was a proper subject to be included in the CBA negotiations between the parties hence, negotiable. 2. WON the assumption powers of the Secretary of Labor and Employment should have been limited merely to the grounds alleged in the second Notice of Strike 3. WON Nestlé was guilty of unfair labor practice HELD 1. YES - In Nestlé Philippines, Inc. v. NLRC, ironically involving the same parties herein, the Court has had the occasion to affirm that a retirement plan is consensual in nature. The Court, through Madame Justice GriñoAquino, declared that:
The fact that the retirement plan is non-contributory, i.e., that the employees contribute nothing to the operation of the plan, does not make it a non-issue in the CBA negotiations. As a matter of fact, almost all of the benefits that the petitioner has granted to its employees under the CBA ± salary increases, rice allowances, midyear bonuses, 13th and 14th month pay, seniority pay, medical and hospitalization plans, health and dental services, vacation, sick & other leaves with pay ± are non-contributory benefits. Since the retirement plan has been an integral part of the CBA since 1972, the Union¶s demand to increase the benefits due the employees under said plan, is a valid CBA issue. x x x [E]mployees do have a vested and demandable right over existing benefits voluntarily granted to them by their employer. The latter may not unilaterally withdraw, eliminate or diminish such benefits

ART. 252. MEANING OF DUTY TO BARGAIN COLLECTIVELY. ± The duty to bargain collectively means the performance of a mutual obligation to meet and confer promptly and expeditiously and 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 agreement if requested by either party, but such duty does not compel any party to agree to a proposal or to make any concession.

- Further, Article 253, also of the Labor Code, defines the parameter of said obligation when there already exists a CBA, viz:
ART. 253. DUTY TO BARGAIN COLLECTIVELY WHEN THERE EXISTS A COLLECTIVE BARGAINING AGREEMENT. ± The duty to bargain collectively shall also mean that either party shall not 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 sixty day period and/or until a new agreement is reached by the parties.

- In demanding that the terms of the Retirement Plan be opened for renegotiation, the members of UFE-DFA-KMU are acting well within their rights as we have, indeed, declared that the Retirement Plan is consensual in character; and so, negotiable. 2. NO. - Declaring the Secretary of the DOLE to have acted with grave abuse of discretion for ruling on substantial matters or issues and not restricting itself merely on the ground rules, the appellate court and UFE-DFA-KMU would have the Court treat the subject labor dispute in a piecemeal fashion. - The power granted to the Secretary of the DOLE by Paragraph (g) of Article 263 of the Labor Code, authorizes her to assume jurisdiction over a labor dispute, causing or likely to cause a strike or lockout in an industry indispensable to the national interest, and correlatively, to decide the same. - In the case at bar, the Secretary of the DOLE simply relied on the Notices of Strike that were filed by UFE-DFA-KMU. Thus, based on the Notices of Strike filed by UFE-DFA-KMU, the Secretary of the DOLE rightly decided on matters of substance. - The issue of whether or not the Secretary of the DOLE could decide issues incidental to the subject labor dispute had already been answered in the affirmative. The Secretary¶s assumption of jurisdiction power necessarily includes matters incidental to the labor dispute, that is, issues that are necessarily involved in the dispute itself, not just to those ascribed in the Notice of Strike; or, otherwise submitted to him for resolution. - In any event, the query as to whether or not the Retirement Plan is to be included in the CBA negotiations between the parties ineluctably dictates upon the Secretary of the DOLE to go into the substantive matter of the CBA negotiations. 3. NO. - Basic is the principle that good faith is presumed and he who alleges bad faith has the duty to prove the same. By imputing bad faith unto the actuations of Nestlé, it was UFE-DFA-KMU, therefore, who had the burden of proof to present substantial evidence to support the allegation of unfair labor practice. - A perusal of the allegations and arguments raised by UFEDFA-KMU in the Memorandum will readily disclose that it failed to discharge said onus probandi as there is still a need for the presentation of evidence other than its bare contention of unfair labor practice in order to make certain the propriety or impropriety of the unfair labor practice charge hurled against Nestlé. - 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, to be precise, the crucial question of whether or not a party has met his statutory duty to bargain in good faith typically turns on the facts of the individual case. Necessarily, a determination of the validity of the Nestlé¶s proposition involves an appraisal of the exercise of its management prerogative. - Employers are accorded rights and privileges to assure their self-determination and independence and reasonable return of capital. This mass of privileges comprises the so-called management prerogatives. In this connection, the rule is that good faith is always presumed. As long as the company¶s

- In the case at bar, it cannot be denied that the CBA that was about to expire at that time contained provisions respecting the Retirement Plan. As the latter benefit was already subject of the existing CBA, the members of UFE-DFA-KMU were only exercising their prerogative to bargain or renegotiate for the improvement of the terms of the Retirement Plan just like they would for all the other economic, as well as non-economic benefits previously enjoyed by them. - The purpose of collective bargaining is the acquisition or attainment of the best possible covenants or terms relating to economic and noneconomic benefits granted by employers and due the employees. The Labor Code has actually imposed as a mutual obligation of both parties, this duty to bargain collectively. - The duty to bargain collectively is categorically prescribed by Article 252 of the said code. It states:

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exercise of the same is in good faith to advance its interest and not for purpose of defeating or circumventing the rights of employees under the law or a valid agreement, such exercise will be upheld. Disposition Petition seeking that Nestlé be declared to have committed unfair labor practice was DENIED. The Petition was PARTLY GRANTED, the ruling of the Court of Appeals was REVERSED in so far as it ruled that the Secretary of the DOLE gravely abused her discretion in failing to confine her assumption of jurisdiction power over the ground rules of the CBA negotiations; but the ruling of the Court of Appeals on the inclusion of the Retirement Plan as a valid issue in the collective bargaining negotiations between UFE-DFA-KMU and Nestlé is AFFIRMED.

Ratio Failing to comply with the mandatory obligation to submit a reply to the union¶s proposals, GMC violated its duty to bargain collectively, making it liable for unfair labor practice. Reasoning Article 253-A, Labor Code

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 GEN. MILLING CORP. v CA (GEN. MILLING CORP. be renegotiated not later than three (3) years after its INDEPENDENT LABOR UNION) execution.... - The representation provision of a CBA should last for five years. 422 SCRA 514 The relation between labor and management should be QUISIMBING; February 11, 2004 undisturbed until the last 60 days of the fifth year. It is indisputable that when the union requested for a renegotiation of NATURE Petition for certiorari assailing the decision of the CA. the economic terms of the CBA on November 29, 1991, it was still the certified collective bargaining agent of the workers, FACTS because it was seeking said renegotiation within five (5) years - Gen. Milling employed 190 employees in its two plants in Cebu and from the date of effectivity of the CBA on December 1, 1988. Lapu-Lapu. They were all members of respondent Gen. Milling Corp. - For refusing to send a counter-proposal to the union and Independent Labor Union (union), a duly certified bargaining agent. to bargain anew on the economic terms of the CBA, the - April 28, 1989: GMC and the union concluded a CBA which included company committed an unfair labor practice under Article the issue of representation effective for a term of three years. The CBA 248 of the Labor Code: was effective for three years retroactive to December 1, 1988 (expiration: ART. 248. Unfair labor practices of employers. ± It shall be November 30, 1991). unlawful for an employer to commit any of the following - A day before the expiration, the union to GMC a CBA, with a request unfair labor practice: for a counter-proposal to be returned within 10 days from receipt. (g) To violate the duty to bargain collectively as - GMC received collective and individual letters from workers who stated prescribed by this Code; that they had withdrawn from their union membership, due to religious ART. 252. Meaning of duty to bargain collectively. ± The affiliation and personal differences. Believing that the union no longer duty to bargain collectively means the performance of a had standing to negotiate a CBA, GMC did not send any countermutual obligation to meet and convene promptly and proposal. expeditiously in good faith for the purpose of - December 16, 1991: GMC wrote a letter to the union¶s officers, stating negotiating an agreement.... that even if there was no longer a basis for negotiations (since there was - Good faith or bad faith is an inference to be drawn from the no union already), management was still willing to enter a dialogue with facts. The effect of an employer¶s or a union¶s actions individually the union. The union officers disclaimed the massive disaffiliation. is not the test of good-faith bargaining, but the impact of all such - January 13, 1992: GMC dismissed Marcia Tumbiga, a union member, occasions or actions, considered as a whole. on the ground of incompetence. The union protested and requested - Under Article 252 both parties are required to perform their GMC to submit the matter to the grievance procedure provided in the mutual obligation to meet and convene promptly and CBA. GMC, however, advised the union to ³refer to our letter dated expeditiously in good faith for the purpose of negotiating an December 16, 1991.´ agreement. The union lived up to this obligation when it - July 2, 1992: the union filed a complaint against GMC with the NLRC, presented proposals for a new CBA to GMC. On the other hand, Arbitration Division, Cebu City, alleging unfair labor practice. The labor GMC failed in its duty under Article 252. What it did was to arbiter dismissed the case with the recommendation that a petition for devise a flimsy excuse, by questioning the existence of the union certification election be held to determine if the union still enjoyed the and the status of its membership to prevent any negotiation. support of the workers. GMC¶s failure to make a timely reply to the proposals presented - The union appealed to the NLRC. The NLRC set aside the labor by the union is indicative of its utter lack of interest in bargaining arbiter¶s decision, and ordered GMC to abide by the CBA draft that the with the union. union proposed for a period of two (2) years. NLRC pointed out that - The CA found that the letters between February to June 1993 upon the effectivity of Rep. Act No. 6715, the duration of a CBA, insofar by 13 union members signifying their resignation from the union as the representation aspect is concerned, is five (5) years which, in the clearly indicated that GMC exerted pressure on its employees. case of GMC-Independent Labor Union was from December 1, 1988 to Yes, GMC interfered with the right of employees to selfNovember 30, 1993; the union remained as the exclusive bargaining organization. agent. ISSUES 1. WON GMC is guilty of unfair labor practice for violating the duty to bargain collectively and/or interfering with the right of its employees to self-organization; 2. WON CA abused its discretion when it imposed upon GMC the draft CBA proposed by the union for two years to begin from the expiration of the original CBA. HELD 1. YES 2. NO Ratio The provision mandates the parties to keep the status quo while they are still in the process of working out their respective proposal and counter proposal. When one of the parties abuses this grace period by purposely delaying the bargaining process, a departure from the general rule is warranted, that is, the court may impose on the erring company the CBA proposed by its employees¶ union - lock, stock and barrel. Reasoning By its acts, no less than its action which bespeak its insincerity, GMC has forfeited whatever rights it could have asserted as an employer.

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- Under ordinary circumstances, 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 allowed to resort with impunity to schemes feigning negotiations by going through empty gestures. DISPOSITION Petition is dismissed.

COLEGIO DE SAN JUAN DE LETRAN V ASSOCIATION OF EMPLOYEES AND FACULTY OF LETRAN (AMBAS) 340 SCRA 587 KAPUNAN, J.; September 18, 2000
NATURE Petition for review on certiorari of the decision of the CA dismissing the petition of petitioner and affirming the order of the Sec of Labor FACTS - Respondent union initiated the renegotiation of its CBA with petitioner for the last 2 years of the CBA¶s 5 year lifetime. In the same year, the union elected a new set of officers wherein private respondent Eleanor Ambas was elected President. Ambas wanted to continue the renegotiation of the CBA but petitioner claimed that the CBA was already prepared for signing by the parties. The parties submitted the disputed CBA to a referendum by the union members, who eventually rejected the said CBA. Petitioner accused the union officers of bargaining in bad faith before the NLRC. The Labor Arbiter decided in favor of petitioner. However, the Labor Arbiter¶s decision was reversed on appeal before the NLRC. The union gave notice to the National Conciliation & Mediation Board of its intention to strike on the grounds of petitioner¶s non-compliance with the NLRC¶s orders and refusal to bargain. - The parties agreed to disregard the unsigned CBA and to start negotiation on a new five-year CBA. The union submitted its proposals to petitioner, which notified the union that the same had been submitted to its Board of Trustees. In the meantime, Ambas was informed through a letter from her superior that her work schedule was being changed from Monday to Friday to Tuesday to Saturday. Ambas protested and requested management to submit the issue to grievance machinery under the old CBA. Due to petitioner¶s inaction, the union filed a notice of strike. The parties met before the NCMB to discuss the ground rules for the negotiation. The union received petitioner¶s letter dismissing Ambas for alleged insubordination. Hence, the union amended its notice of strike to include Ambas¶ dismissal. Both parties again discussed the ground rules for the CBA renegotiation. However, petitioner stopped the negotiations after it purportedly received information that a new group of employees had filed a petition for certification election. - The union finally struck. Public respondent Sec of Labor assumed jurisdiction and ordered all striking employees including the union president to return to work and for petitioner to accept them back under the same terms and conditions before the actual strike. Petitioner readmitted the striking members except Ambas. Public respondent issued an order declaring petitioner guilty of unfair labor practice on two counts and directing the reinstatement of private respondent Ambas with backwages. Petitioner filed an MFR which was denied. Petitioner sought a review of the order of the Sec of Labor before the CA. The appellate court dismissed the petition and affirmed the findings of public respondent. ISSUE/S 1. WON petitioner is guilty of unfair labor practice by refusing to bargain with the union when unilaterally suspended negotiations 2. WON termination of the union president amounts to interference with the right to self-organization HELD 1. YES Ratio Petitioner¶s utter lack of interest in bargaining with the union is obvious in its failure to make a timely reply to the proposals presented

by the latter. Where the employer did not even bother to submit an answer to the bargaining proposals of the union, there is a clear evasion of the duty to bargain collectively. Reasoning In order to allow the employer to validly suspend the bargaining process there must be a valid petition for certification election raising a legitimate representation issue. The mere filing of a petition for certification election does not ipso facto justify the suspension of negotiation. The petition must first comply with the Labor Code and its Implementing Rules. Significantly, the same petition was dismissed by the Sec of Labor. The dismissal was upheld by this Court. 2. YES Ratio Management has the prerogative to discipline its employees for insubordination. But when the exercise of such management right tends to interfere with the employees¶ right to self-organization, it amounts to union-busting and is therefore a prohibited act. Reasoning The dismissal of Ms. Ambas was clearly designed to frustrate the Union in its desire to forge a new CBA with the College that is reflective of the true wishes and aspirations of the Union members. Her dismissal was merely a subterfuge to get rid of her. It has the effect of busting the Union, stripping it of its strong-willed leadership. When management refused to treat the charge of insubordination as a grievance within the scope of the Grievance Machinery, the action of the College in finally dismissing her from the service became arbitrary, capricious and whimsical, and therefore violated Ms. Ambas¶ right to due process. On Duty to Bargain Collectively Article 252 of the Labor Code defines the meaning of the phrase "duty to bargain collectively," as follows: 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. Disposition Petition is DENIED for lack of merit.

KIOK LOY (SWEDEN ICE CREAM PLANT) V NLRC, KILUSAN G.R. No. L-54334 CUEVAS; JAN 22 1986
NATURE Petition for CERTIORARI to annul the decision ofNLRC (w/c found petitioner guilty of ULP for unjustified refusal to bargain, in violation of par. (g) of Article 249 Labor Code, and declared the draft proposal of the KILUSAN for a collective bargaining agreement as the governing CBA bet the EEs and the mgt. FACTS - Pambansang Kilusan ng Paggawa (Kilusan), a legitimate labor federation, won cert election and was certified by the BLR as the sole and exclusive bargaining agent of the rank-and-file employees of Sweden Ice Cream Plant (Company). - Kilusan then gave the Company two copies of its proposed CBA. It requested the Company for its counter proposals. There was no response from Company. Kilusan again requested the Company for collective bargaining negotiations and for the Company to furnish them with its counter proposals. Both requests were ignored and remained unacted upon by the Company. -Kilusan on Feb 14, 1979, filed a "Notice of Strike", with the BLR on ground of unresolved economic issues in collective

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preconditions are undisputedly present in the instant case. -From the over-all conduct of petitioner company, Kilusan has a valid cause to complain against Company's attitude, the totality of which is indicative of the latter's disregard of, and failure to live up to, what is enjoined by the Labor Code ---- to bargain in good faith. -Company is GUILTY of unfair labor practice. (1) respondent Union was a duly certified bargaining agent; (2) it made a definite request to bargain, accompanied with a copy of the proposed CBA, to the Company not only once but twice which were left unanswered and unacted upon; and (3) the Company made no counter proposal whatsoever all of which conclusively indicate lack of a sincere desire to negotiate. Even during the period of compulsory arbitration before the NLRC, Company's stalled the negotiation by a series of postponements, non-appearance at the hearing conducted -Herald Delivery Carriers Union (PAFLU) vs. Herald Publications: "unfair labor practice is committed when it is shown that the respondent employer, after having been served with a written bargaining proposal by the petitioning Union, did not even bother to submit an answer or reply to the said proposal. This doctrine was reiterated in Bradman vs. CIR: "while the law does not compel the parties to reach an agreement, it does contemplate that both parties will approach the negotiation with an open mind and make a reasonable effort to reach a common ground of agreement". 3) YES - The instant case being a certified one, it must be resolved by the NLRC pursuant to the mandate of P.D. 873, as amended, which authorizes the said body to determine the reasonableness of the terms and conditions of employment embodied in any CBA. To that extent, utmost deference to its findings of reasonableness of any Collective Bargaining Agreement as the governing agreement by the employees and management must be accorded due respect by this Court.

-Conciliation proceedings followed but all attempts towards an amicable settlement failed. BLR certified the case to the NLRC for compulsory arbitration. The case was reset/postponed several times (mostly Company¶s ³request´). -Then in the scheduled hearing on June 4, 1979, the Company's representative, Mr. Ching, who was supposed to be examined, failed to appear. The Company¶s counsel requested for another postponement. The labor arbiter denied. He ruled that the Company has waived its right to present further evidence and, therefore, considered the case submitted for resolution. - NLRC held: Sweden Ice Cream guilty of unjustified refusal to bargain. The draft proposal for a CBA was found to be reasonable under the premises, and declared to be the collective agreement w/c should govern the relationship between the parties. -Petitioner: «its right to procedural due process has been violated when it was precluded from presenting further evidence in support of its stand and when its request for further postponement was denied. «that the NLRC¶s finding of unfair labor practice for refusal to bargain is not supported by law and the evidence considering that it was only on May 24. 1979 when the Union furnished them with a copy of the proposed CBA and it was only then that they came to know of the Union's demands; « that CBA approved and adopted by the NLRC is unreasonable and lacks legal basis. ISSUE/S 4) WON company¶s right to due process has been violated 5) WON company is guilty of ULP 6) WON CBA is reasonable

HELD 1) NO -Considering the various postponements granted in its behalf, the claimed denial of due process appeared totally bereft of any legal and factual support. As herein earlier stated, petitioner had not even honored respondent union with any reply to the latter's successive letters, all geared towards bringing the Company to the bargaining table.. Certainly, the moves and overall behavior of company were in total derogation of Disposition Petition dismissed. the policy enshrined in the Labor Code which is aimed towards expediting settlement of economic disputes. Hence, the Court is not prepared to affix its imprimatur to such an illegal scheme and dubious REPUBLIC SAVINGS BANK maneuvers. 21 SCRA 226 2) YES - Article 249, par. (g) LC 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 including proposals for adjusting any grievance or question arising under such an agreement and executing a contract incorporating such agreement, if requested by either party." -Collective bargaining which is defined as negotiations towards a collective agreement, is designed 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. - 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 ff. 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 LC; (2) proof of majority representation; and (3) a demand to bargain under Art 251, par. (a) of the Labor Code . . . all of which

v. CIR

CASTRO; September 27, 1967
NATURE Appeal of CIR decision FACTS - Republic Savings Bank (now Republic Bank or RB) discharged/terminated private respondents Resuello, Jola et al, for having written and published "a patently libelous letter, tending to cause the dishonor, discredit or contempt not only of officers and employees of this bank, but also of your employer, the bank itself." Respondents had written to the bank president, Ramon Racelis, a letter-charge, demanding his resignation on the grounds of immorality, nepotism in the appointment and favoritism as well as discrimination in the promotion of RB employees. - CIR ruled that RB¶s act of dismissing the 8 respondent employees constituted an unfair labor practice within the meaning and intendment of the Industrial Peace Act (RA 875). RB appealed. It still maintains that the discharge was for cause. - RB¶s defense: CIR should have dismissed the complaint because the discharge of the respondents had nothing to do with their union activities as the latter in fact admitted at the hearing that the writing of the letter-charge was not a "union action" but merely their "individual" act.

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ISSUE WON the dismissal of the 8 employees by RB constituted unfair labor practice within the meaning and intendment of the Industrial Peace Act HELD YES. - Even assuming that respondents acted in their individual capacities when they wrote the letter-charge they were nonetheless protected for they were engaged in concerted activity, in the exercise of their right of self-organization that includes concerted activity for mutual aid and protection, interference with which constitutes an unfair labor practice. The joining in protests or demands, even by a small group of employees, if in furtherance of their interests, is a concerted activity protected by the Industrial Peace Act. It is not necessary that union activity be involved or that collective bargaining be contemplated. - NLRC v. Phoenix Mutual Life Insurance Co is case in point. Held: An insurance company was guilty of an unfair labor practice in interfering with this right of concerted activity by discharging two agents employed in a branch office. The agents acts of meeting and joining in a letter to the home office objecting to the transfer to their branch office of a cashier from another branch, for further discussion, approval and signature, is a concerted activity that is protected. Re Meaning of Duty to Bargain - What the RB should have done was to refer the letter-charge to the grievance committee. This was its duty, failing which it committed an unfair labor practice RA 875 which makes it an unfair labor practice for an employer "to dismiss, discharge or otherwise prejudice or discriminate against an employee for having filed charges or for having given or being about to give testimony under this Act." - Collective bargaining does not end with the execution of an agreement. It is a continuous process. The duty to bargain imposes on the parties during the term of their agreement the mutual obligation ³to meet and confer promptly and expeditiously and in good faith for the purpose of adjusting any grievances or question arising under such agreement´ and a violation of this obligation is an unfair labor practice. - Instead of stifling criticism, RB should have allowed the respondents to air their grievances. Good faith bargaining required of the Bank an open mind and a sincere desire to negotiate over grievances. The grievance committee, created in the CBA, would have been an appropriate forum for such negotiation. Indeed, the grievance procedure is a part of the continuous process of collective bargaining. It is intended to promote a friendly dialogue between labor and management as a means of maintaining industrial peace. Disposition Appealed decision is AFFIRMED FERNANDO, CONCURRING - Collective bargaining presupposes the give-and-take of discussion. No party adopts, at least in its initial stages, a hard-line position, from which there can be no retreat. That was not the situation here. Respondents as labor leaders were quite certain that the President of RB had offended most grievously. They wanted him out. There was no room for discussion. - That for me is not bargaining as traditionally and commonly understood. It is for that reason that I find it difficult to agree fully with the view that their dismissal could be construed as a refusal to bargain collectively. Moreover, they did not as adverted to in the opinion of the Court, follow the procedure set forth for adjusting grievances. It is my view therefore that the dismissal amounted to "interference, restraint or coercion" as prohibited in the Industrial Peace Act, and not refusal to bargain collectively.

FACTS - In July 1990, San Miguel Cooperation shut down some of its plants and declared 55 positions as redundant. Consequently, the private respondent union filed several grievance cases for the said retrenched employees, praying for the redeployment of the said employees to the other divisions of the company. - Grievance proceedings were conducted pursuant to Sections 5 and 8, Article VIII of the parties¶ 1990 Collective Bargaining Agreement. During the grievance proceedings, however, most of the employees were redeployed, while others accepted early retirement. As a result only 17 employees remained when the parties proceeded to the third level of the grievance procedure. In a meeting on October 26, 1990, petitioner informed private respondent union that if by October 30, 1990, the remaining 17 employees could not yet be redeployed, their services would be terminated on November 2, 1990. The said meeting adjourned when Mr. Daniel S. L. Borbon II, a representative of the union, declared that there was nothing more to discuss in view of the deadlock. - On November 7, 1990, the private respondent filed with the National Conciliation and Mediation Board (NCMB) of the Department of Labor and Employment (DOLE) a notice of strike on the following grounds: a) bargaining deadlock; b) union busting; c) gross violation of the CBA such as non-compliance with the grievance procedure; d) failure to provide private respondent with a list of vacant positions pursuant to the parties side agreement that was appended to the 1990 CBA; and e) defiance of voluntary arbitration award. Petitioner on the other hand, moved to dismiss the notice of strike but the NCMB failed to act on the motion. - On December 21, 1990, petitioner SMC filed a complaint with the respondent NLRC, praying for: (1) the dismissal the notice of strike; (2) an order compelling the respondent union to submit to grievance and arbitration the issue listed in the notice of strike; (3) the recovery of the expenses of litigation. Respondent NLRC came out with a minute resolution dismissing the complaint. ISSUE WON NLRC gravely abused its discretion in dismissing SMC¶s complaint HELD YES - Rule XXII, Section I, of the Rules and Regulations Implementing Book V the Labor Code,10 [As amended by D.O. No. 09 which took effect on June 21, 1997.] reads: "Section 1. Grounds for strike and lockout. -- A strike or lockout may be declared in cases of bargaining deadlocks and unfair labor practices. Violations of the collective bargaining agreements, except flagrant and/or malicious refusal to comply with its economic provisions, shall not be considered unfair labor practice and shall not be strikeable. No strike or lockout may be declared on grounds involving inter-union and intra-union disputes or on issues brought to voluntary or compulsory arbitration." - In the case under consideration, the grounds relied upon by the private respondent union are non-strikeable. The issues which may lend substance to the notice of strike filed by the private respondent union are: collective bargaining deadlock and petitioner¶s alleged violation of the collective bargaining agreement. These grounds, however, appear more illusory than real. - Collective Bargaining Deadlock is defined as "the situation between the labor and the management of the company where there is failure in the collective bargaining negotiations resulting in a stalemate". This situation, is non-existent in the present case

DEADLOCK SAN MIGUEL CORP. V NLRC 304 SCRA 1 PURISIMA; March 23, 1999

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since there is a Board assigned on the third level of the grievance machinery to resolve the conflicting views of the parties. Instead of asking the Conciliation Board composed of five representatives each from the company and the union, to decide the conflict, petitioner declared a deadlock, and thereafter, filed a notice of strike. For failing to exhaust all the steps in the grievance machinery and arbitration proceedings provided in the Collective Bargaining Agreement, the notice of strike should have been dismissed by the NLRC and private respondent union ordered to proceed with the grievance and arbitration proceedings. In the case of Liberal Labor Union vs. Phil. Can Co., the court declared as illegal the strike staged by the union for not complying with the grievance procedure provided in the collective bargaining agreement, ruling that: "x x x the main purpose of the parties in adopting a procedure in the settlement of their disputes is to prevent a strike. This procedure must be followed in its entirety if it is to achieve its objective. x x x strikes held in violation of the terms contained in the collective bargaining agreement are illegal, specially when they provide for conclusive arbitration clauses. These agreements must be strictly adhered to and respected if their ends have to be achieved. x x x" As regards the alleged violation of the CBA, we hold that such a violation is chargeable against the private respondent union. In abandoning the grievance proceedings and stubbornly refusing to avail of the remedies under the CBA, private respondent violated the mandatory provisions of the collective bargaining agreement. Disposition Petition is granted.

MINUTES OF NEGOTIATION SAMAHANG MANGGAGAWA SA TOP FORM V. NLRC 295 SCRA 171 ROMERO : September 7, 1998
FACTS: - The charge arose from the employer's refusal to grant across-theboard increases to its employees in implementing Wage Orders Nos. 01 and 02 of the Regional Tripartite Wages and Productivity Board of the National Capital Region (RTWPB-NCR). Such refusal was aggravated by the fact that prior to the issuance of said wage orders, the employer allegedly promised at the collective bargaining conferences to implement any government-mandated wage increases on an across-theboard basis. - Petitioner Samahang Manggagawa sa Top Form Manufacturing United Workers of the Philippines (SMTFM) was the certified collective bargaining representative of all regular rank and file employees of private respondent Top Form Manufacturing Philippines, Inc. - At the collective bargaining negotiation, the parties agreed to discuss unresolved economic issues. According to the minutes of the meeting the Union proposed that any future wage increase given by the government should be implemented by the company across-the-board or non-conditional. - Management requested the union to retain this provision since their sincerity was already proven when the P25.00 wage increase was granted across-the-board. The union acknowledges management's sincerity but they are worried that in case there is a new set of management, they can just show their CBA. The union decided to defer this provision. - In their joint affidavit dated January 30, 1992, union members Salve L. Barnes, Eulisa Mendoza, Lourdes Barbero and Concesa Ibañez affirmed that at the subsequent collective bargaining negotiations, the union insisted on the incorporation in the collective bargaining agreement (CBA) of the union proposal on "automatic across-the-board wage increase." - On October 15, 1990, the RTWPB-NCR issued Wage Order No. 01 granting an increase of P17.00 per day in the salary of workers. This

was followed by Wage Order No. 02 dated December 20, 1990 providing for a P12.00 daily increase in salary. - As expected, the union requested the implementation of said wage orders. However, they demanded that the increase be on an across-the-board basis. Private respondent refused to accede to that demand. Instead, it implemented a scheme of increases purportedly to avoid wage distortion. - On October 24, 1991, the union, through its legal counsel, wrote private respondent a letter demanding that it should "fulfill its pledge of sincerity to the union by granting an across-theboard wage increase to all employees under the wage orders." - Several conferences between the parties notwithstanding, private respondent adamantly maintained its position on the salary increases it had granted that were purportedly designed to avoid wage distortion. - Consequently, the union filed a complaint with the NCR NLRC alleging that private respondent's act of "reneging on its undertaking/promise clearly constitutes act of unfair labor practice through bargaining in bad faith." It charged private respondent with acts of unfair labor practices or violation of Article 247 of the Labor Code, as amended, specifically "bargaining in bad faith," and prayed that it be awarded actual, moral and exemplary damages. - Private respondent, on the other hand, contended that in implementing Wage Orders Nos. 01 and 02, it had avoided "the existence of a wage distortion" that would arise from such implementation. It emphasized that only "after a reasonable length of time from the implementation" of the wage orders "that the union surprisingly raised the question that the company should have implemented said wage orders on an across-theboard basis." It asserted that there was no agreement to the effect that future wage increases mandated by the government should be implemented on an across-the-board basis. Otherwise, that agreement would have been incorporated and expressly stipulated in the CBA. - On March 11, 1992, Labor Arbiter Jose G. de Vera rendered a decision dismissing the complaint for lack of merit. - Not satisfied, petitioner appealed to the NLRC that, in turn, promulgated the assailed Resolution of April 29, 1993 dismissing the appeal for lack of merit. Still dissatisfied, petitioner sought reconsideration which, however, was denied by the NLRC in the Resolution dated January 17, 1994. ISSUE: WON private respondent committed an unfair labor practice HELD: NO Reasoning: - If there was indeed a promise or undertaking on the part of private respondent to obligate itself to grant an automatic acrossthe-board wage increase, petitioner union should have requested or demanded that such "promise or undertaking" be incorporated in the CBA. After all, petitioner union has the means under the law to compel private respondent to incorporate this specific economic proposal in the CBA. It could have invoked Article 252 of the Labor Code defining "duty to bargain," thus, the duty includes "executing a contract incorporating such agreements if requested by either party." - The CBA is the law between the contracting parties, the collective bargaining representative and the employer-company. 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. Where a proposal raised by a contracting party does not find print in the CBA, it is not a part thereof and the proponent has no claim whatsoever to its

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implementation. Because the proposal was never embodied in the CBA, the promise has remained just that, a promise, the implementation of which cannot be validly demanded under the law. DISPOSITIVE: NLRC decision affirmed.

notice. the company's refusal to make counter-proposal to the union's proposed CBA is an indication of its bad faith -Moreover, the series of events (changing of Ambas¶ work sched and her subsequent dismissal for insubordination) that transpired after the filing of the first notice of strike in January 1996 show petitioner's resort to delaying tactics to ensure that negotiation would not push through.

SUSPENSION OF BARGAINING COLEGIO de SAN JUAN de LETRAN v ASSOCIATION OF EMPLOYEES 340 SCRA 587 KAPUNAN; September 18, 2000
FACTS: -Newly elected union president Ambas wanted to continue the renegotiation of the CBA with said school but petitioner claimed that the CBA was already prepared for signing by the parties. Union members rejected CBA -union notified the National Conciliation and Mediation Board (NCMB) of its intention to strike on the ground of petitioner's refusal to bargain. January 18, 1996, the parties agreed to start negotiation on a new fiveyear CBA starting 1994-1999. On February 7, 1996, the union submitted its proposals to petitioner, which notified the union six days later or on February 13, 1996 that the same had been submitted to its Board of Trustees. -In the meantime, Ambas was informed that her work schedule was being changed from Monday to Friday to Tuesday to Saturday. Ambas protested and requested management to submit the issue to a grievance machinery under the old CBA -Due to petitioner's inaction, the union filed a notice of strike. The parties met on March 27, 1996 before the NCMB to discuss the ground rules for the negotiation. On March 29, 1996, the union received petitioner's letter dismissing Ambas for alleged insubordination - On April 20, 1996, both parties again discussed the ground rules for the CBA renegotiation. However, petitioner stopped the negotiations after it purportedly received information that a new group of employees had filed a petition for certification election -union finally struck. On July 2, 1996, public respondent the Secretary of Labor and Employment assumed jurisdiction and issued a return to work order - On December 2, 1996, public respondent issued an order declaring petitioner guilty of unfair labor practice on two counts and directing the reinstatement of private respondent Ambas with backwages ISSUE: WON petitioner is guilty of unfair labor practice by refusing to bargain with the union when it unilaterally suspended the ongoing negotiations for a new CBA upon mere information that a petition for certification has been filed by another legitimate labor organization? HELD: yes -Article 252 of the Labor Code defines the meaning of the phrase "duty to bargain collectively´. Noteworthy in the above definition is the requirement on both parties of the performance of the mutual obligation to meet and convene promptly and expeditiously in good faith for the purpose of negotiating an agreement -union lived up to this requisite when it presented its proposals for the CBA to petitioner on February 7, 1996. On the other hand, petitioner devised ways and means in order to prevent the negotiation -Petitioner's utter lack of interest in bargaining with the union is obvious in its failure to make a timely reply to the proposals presented by the latter. More than a month after the proposals were submitted by the union, petitioner still had not made any counter-proposals which is a clear violation of Art.250 which in part states: 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

7.04 BARGAINABLE ISSUES-252
ART. 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.

ISSUES MANILA FASHIONS, INC. V NLRC (ZAMORA AND NAGKAKAISANG MANGGAGAWA NG MANILA FASHIONS, INC.) G.R. No. 117878 BELLOSILLO; November 13, 1996
FACTS - respondent Nagkakaisang Manggagawa ng Manila Fashions, Inc., through its president, respondent Nonito Zamora, filed a complaint before the Labor Arbiter on behalf of its one hundred and fifty (150) members who were regular employees of petitioner Manila Fashions, Inc. The complaint charged petitioner with non-compliance, with Wage Order No NCR-02 and 02-A mandating a P12- increase in wages effective 8 January 1991. As a result, complainants' basic pay, 13th month pay, service incentive leave pay, legal holiday pay, night shift differential and overtime pay were all underpaid - Petitioner countered that the failure to comply with the pertinent Wage Order was brought about by the tremendous losses suffered by it which were aggravated when the workers staged a strike on account of the non-adjustment of their basic pay. To forestall continuous suspension/closure of business operations, which petitioner did for three (3) months, the strikers sent a notice that they were willing to condone the implementation of the increase. The condonation was distinctly stated in Sec. 3, Art. VIII, of the Collective Bargaining Agreement (CBA) dated 4 February 1992, which was voluntarily entered into by the parties and represents a reasonable settlement ³The Union realizes the company¶s closeness to insolvency and, as such , sympathizes with the company¶s condition. Therefore, the Union has agreed, as it hereby agrees, to condone the implementation of Wage Order o. NCR-02 and 02-A. - The complainants admitted the existence of the aforementioned provision in the CBA; however they denied the validity thereof inasmuch as it was not reached after due consultation with the members. - The Labor Arbiter sustained the claim that the subject provision of the CBA was void but based its conclusion on a different ground :

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. . . While it is true that both union officers/members and (petitioner) signed the agreement, however, the same is not enforceable since said agreement is null and void, it being contrary to law. It is only the Tripartite Wage Productivity Board of (the) Department of Labor and Employment (DOLE) that could approve exemption (of) an establishment from coverage of (a) Wage Order . . . ISSUES 1. WON the condonation of the implementation of Wage Order No. NCR-02 and 02-A contained in Sec. 3, Art. VIII, of the CBA was valid HELD 1. NO Reasoning A Collective Bargaining Agreement refers to the negotiated contract between a legitimate labor organization and the employer concerning wages, hours of work and all other terms and conditions of employment in a bargaining unit, including mandatory provisions for grievances and arbitration machineries. As in all other contracts, the parties in a CBA may establish such stipulations, clauses, terms and conditions as they may deem convenient provided they are not contrary to law, morals, good customs, public order or public policy. Section 3, Art. VIII, of the CBA is a void provision because by agreeing to condone the implementation of the Wage Order the parties thereby contravened its mandate on wage increase of P12.00 effective 8 January 1991. Also, as stated by the Labor Arbiter, it is only the Tripartite Wage Productivity Board of the DOLE that could approve exemption of an establishment from coverage of a Wage Order. If petitioner is a financially distressed company then it should have applied for a wage exemption so that it could meet its labor costs without endangering its viability or its very existence upon which both management and labor depend for a living. The Office of the Solicitor General emphasizes the point that parties to a CBA may not by themselves, set a wage lower than the minimum wage. To do so would render nugatory the purpose of a wage exemption, not to mention the possibility that employees may be unwittingly put in a position to accept a lower wage. The cases that petitioner relies on are simply inapplicable because, unlike the present case which involves a stipulation in the CBA in contravention of law, they are concerned with compromise settlements as a means to end labor disputes recognized by Art. 227 of the Labor Code and considered not against public policy by doctrinal rules established by this Court. Disposition Petition is dismissed.

- Nestle filed this petition for certiorari alleging that since its retirement plan is non-contributory, it has the sole and exclusive prerogative to define the terms of the plan because the workers have no vested and demandable rights there under, the grant being not a contractual obligation but merely gratuitous. At most the company can only be directed to maintain the same but not to change its terms. It should be left to the discretion of the company on how to improve or modify the same. ISSUE WON the Retirement Plan is a collective bargaining issue HELD YES. Ratio The fact that the retirement plan is non-contributory, i.e., that the employees contribute nothing to the operation of the plan, does not make it a non-issue in the CBA negotiations. Reasoning Almost all of the benefits granted to its employees under the CBA (salary increases, rice allowances, midyear bonuses, 13th & 14th month pay, seniority pay, medical and hospitalization plans, health and dental services, vacation, sick & other leaves with pay) are non-contributory benefits. Since the retirement plan has been an integral part of the CBA since 1972, the Union's demand to increase the benefits due the employees under said plan is a valid CBA issue. - The improvement of the existing Retirement Plan was one of the original CBA proposals submitted by the UFE to Nestle. The union's original proposal was to modify the existing plan by including a provision for early retirement. The company did not question the validity of that proposal as a collective bargaining issue but merely offered to maintain the existing noncontributory retirement plan which it believed to be still adequate for the needs of its employees and competitive with those existing in the industry. The union thereafter modified its proposal, but the company was adamant. Consequently, the impasse on the retirement plan became one of the issues certified to the NLRC for compulsory arbitration. - The inclusion of the retirement plan in the CBA as part of the package of economic benefits extended by the company to its employees gives it "a consensual character" so that it may not be terminated or modified at will by either party. Employees have a vested and demandable right over existing benefits voluntarily granted to them by their employer. The latter may not unilaterally withdraw, eliminate or diminish such benefits. Disposition Petition is DISMISSED.

NESTLE PHIL V NLRC (Union of FIL-IPRO Employees) 193 SCRA 504 GRINO-AQUINO; February 4, 1999
NATURE Petition for certiorari FACTS - Four CBAs with Nestle Philippines (Nestle) expired on June 30, 1987. While the parties were negotiating, the employees resorted to a "slowdown" and walk-outs prompting Nestle to shut down the factory. Marathon collective bargaining negotiations between the parties ensued. - The UFE declared a bargaining deadlock. The Secretary of Labor assumed jurisdiction and issued a return to work order. In spite of that order, the union struck, without notice. Nestle retaliated by dismissing the union officers and members of the negotiating panel who participated in the illegal strike. The NLRC affirmed the dismissals. UFE filed a notice of strike on the same ground of CBA deadlock and ULP. - After conciliation efforts of the NCMB yielded negative results, the dispute was certified to the NLRC by the Secretary of Labor. The NLRC issued a resolution regarding the union's demand for liberalization of the company's retirement plan for its workers. Both the parties¶ MFR were denied.

SAMAHANG MANGGAGAWA SA TOP FORM MANUFACTURING UNITED WORKERS OF THE PHILIPPINES V NLRC (DE VERA). 295 SCRA 171 ROMERO; September 7, 1998
NATURE Petition for review on certiorari FACTS . At the collective bargaining negotiation between SMTFM-UWP and its employer, the Union proposed that any future wage increase given by the government should be implemented by the company across-the-board or non-conditional. The management promised to implement this but requested the union to drop the provision since their sincerity was already proven when the P25.00 wage increase was granted across-the-board. An undertaking to this effect was taken by the officials of the company. - RTWPB-NCR issued Wage Order No. 01 and Wage Order No. 02 providing for a P17 and P12 daily increase in salary, respectively.

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- Union requested the implementation of said wage orders on an acrossthe-board basis. Employer refused. Instead, it implemented a scheme of increases purportedly to avoid wage distortion. - Several conferences were held but they were not able to settle. - Union filed a complaint for unfair labor practices or violation of Article 247 of the Labor Code, specifically "bargaining in bad faith," and prayed that it be awarded actual, moral and exemplary damages. Union added that it was also charging private respondent with violation of Article 100. - Labor arbiter De Vera, and subsequently, the NLRC, dismissed the complaint for lack of merit. ISSUES 1. WON the employer committed an unfair labor practice HELD 1. NO Ratio The CBA is the law between the contracting parties. 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. Where a proposal raised by a contracting party does not find print in the CBA, it is not a part thereof and the proponent has no claim whatsoever to its implementation Reasoning - If there was indeed a promise or undertaking on the part of the management to obligate itself to grant an automatic across-the-board wage increase, union should have requested or demanded that such be incorporated in the CBA. It could have invoked Article 252 of the Labor Code defining "duty to bargain," thus, the duty includes "executing a contract incorporating such agreements if requested by either party." However, Article 252 also states that the duty to bargain "does not compel any party to agree to a proposal or make any concession." Thus, union may not validly claim that the proposal embodied in the Minutes of the negotiation forms part of the CBA that it finally entered into with private respondent. - Union asserts that management committed "acts of unfair labor practices by virtue of its contractual commitment made during the collective bargaining process." The mere fact, however, that the proposal in question was not included in the CBA indicates that no contractual commitment thereon was ever made as no agreement had been arrived at by the parties. - The purpose of collective bargaining is the reaching of an agreement resulting in a contract binding on the parties; but the failure to reach an agreement after negotiations continued for a reasonable period does not establish a lack of good faith. The statutes invite and contemplate a collective bargaining contract, but they do not compel one. The duty to bargain does not include the obligation to reach an agreement. - 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. - No benefits or privileges previously enjoyed by union and the other employees were withdrawn as a result of the manner by which private respondent implemented the wage orders. Granted that private respondent had granted an across-the-board increase pursuant to RA 6727, that single instance may not be considered an established company practice. Union's argument in this regard is actually tied up with its claim that the implementation of Wage Orders Nos. 01 and 02 by private respondent resulted in wage distortion.

THE SUBJECTS OF ³MANDATORY BARGAINING´ BERNARD D. MELTZER
- Collective bargaining ± alternative to individual bargaining; also a process for joing determination of web of private rules that govern and impinge on employment - Uncertainty exists regarding union¶s right to participate in decisions on matters that affect EXISTENCE of jobs rather than their TERMS and conditions. - New conditions include the progressive expansion of collective agreements into new areas. Areas included in the subjects of mandatory bargaining expanded. - Issues involved: - Is a subject within or beyond mandatory bargaining? - How to balance management interest in innovation and employee interest in decisions that may affect their economic lives - Role of law and economic power in determining area of negotiation - Sphere of NLRB, courts, Congress - Outside US, there are other forms of participation, including systems of codetermination under w/c workers¶ representatives join stockholders¶ representatives on directorial boards. NLRB V. WOOSTER DIV. OF BORG-WARNER CORP. - Here, employer insisted that collective bargaining contract include 1. ballot clause calling for prestrike secret vote as to the employer¶s last offer 2. recognition clause w/c excluded, as party to the contract, the International Union - Board held that the employer¶s insistence on the clauses amounted to refusal to bargain. - Board held that the clauses do not come within scope of mandatory collective bargaining. - SC sustained the Board¶s order directing employer to cease insisting upon either clause. - International was certified by the Board to the Wooster Division of the Borg-Warner Corp as the elected representative. International chartered a local. Together the unions presented a comprehensive CBA. - Company submitted counterproposal. Unions¶ negotiators objected because a clause disregarded the certification of International as the employees¶ representative. The counterproposal also contained the ballot clause. - Unions did not accept the clause. They struck, but negotiations continued. Finally, the local, upon recommendation of International, gave in and entered into agreement with both clauses. - The obligation to bargain in good faith is limited to subjects within ³wages, hours, and other terms and conditions of employment«´ As to other matters, each party is free to bargain or not. - Company¶s good faith met the requirements as to subjects of mandatory bargaining. But that doesn¶t license employer to refuse to enter into agreements on ground that they don¶t include some proposal w/c is not a mandatory subject of bargaining. Such conduct is a refusal to bargain. - The two clauses are lawful. But it doesn¶t follow that because the company may propose these, it can lawfully insist upon them. - The issue now becomes WON the two clauses come within the phrase ³wages, hours, and other terms«´ - The ballot clause does not. It relates only to procedure before strike.

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- The recognition clause also does not come within the definition of mandatory bargaining. The Act doesn¶t prohibit voluntary addition of a party, but that doesn¶t authorize employer to exclude a certified representative. Harlan, J., whom Clark and Whittaker, JJ., join, concurring in part and dissenting in part - I must state that I am unable to grasp a concept of ³bargaining´ which enables one to ³propose´ a particular point, but not to ³insist´ on it as a condition to agreement. - The ballot clause should come within ³other terms and conditions«´ It affects employer-employee relationship, determines timing of strikes or even whether a strike will occur. - Nonetheless, I accept Court¶s holding that this clause is not a condition of employment. - Bargaining process should be fluid. - WON party bargained in good faith depends upon evaluation of total circumstances. RAILROAD TELEGRAPHERS V. CHICAGO & NW. RY. - Norris-LaGuardia Act barred a permanent injunction against a threatened strike in support of a demand that the railroad should not abolish preexisting jobs without incumbent union¶s consent. - Majority found that the demand fell within bargainable subjects. - There is nothing strange about agreements that affect permanency of employment. FIBREBOARD PAPER PRODUCTS CORP. V. NLRB - Issue is WON ³contracting out´ of work being performed by employees is a statutory subject of collective bargaining. - Board adhered to Trial Examiner¶s finding that company¶s motive in contracting out was economic rather than antiunion but found nonetheless that failure to negotiate with union concerning its decision to subcontract constituted a violation. - Contracting out work is a matter within phrase ³other terms and conditions«´ and is a mandatory subject of collective bargaining. - In this case, the maintenance work still had to be performed. No capital investment was contemplated. Company merely replaced existing employees with those of an independent contractor. To require employer to bargain on this would not significantly abridge its freedom to manage the business. - Another issue is WON upon finding that the company refused to bargain on a statutory subject of collective bargaining, Board was empowered to order resumption of maintenance operations and reinstatement with back pay. Held: It is so empowered. Stewart, J., with whom Douglas and Harlan, JJ., join, concurring. - Court doesn¶t decide that every managerial decision which terminates employment is subject to duty to bargain. Nor does Court decide that subcontracting is as a general matter subject to that duty. - Industrial experience may be useful in determining proper scope of duty to bargain. - Only a narrow concept of ³conditions of employment«´ will serve purpose of delineating a limited category of issues w/c are subject to duty to bargain collectively. GOLDBERG, MANAGEMENT¶S RESERVED RIGHTS: A LABOR VIEW - Mature bargaining relationships require reliance on acceptance of rights of each party by the other. - Business is often conservative on social questions but radical when it comes to production. Trade unionists and trade unions are radicals in changing social institutions but they are conservative in approach to changes in methods of production. - Employer has right to innovation and change. Employee and union seek to protect right to certainty / security. WESTINGHOUSE ELECTRIC CORP. - Contracting out has been a practice of respondent. Before doing so, respondent considers economic feasibility of doing the work with unit employees. It doesn¶t advise Union each time it awards work to an outside contractor - In Fibreboard cases, contracting out is a departure from established practice. Here, contracting out is motivated solely by economic

considerations and that it comported with traditional methods. The respondent did not violate its statutory bargaining obligation. ALLIED CHEMICAL & ALKALI WORKERS V. PITTSBURGH PLATE GLASS CO. - NLRB held that changes in retired employees¶ retirement benefits are embraced by the bargaining obligation and that employer¶s unilateral modification of them is an unfair labor practice. CA disagreed. SC affirmed order of CA. - Board held that pensioners are ³employees´ and members of the bargaining unit. - Board¶s decision is not supported by law. The Act is concerned with rights of workers, not those who have retired from the work force. ³Employee´ is not to be stretched beyond its plain meaning. - Active and retired employees do not share a community of interests. Pensioners¶ interests extend only to retirement benefits. Inclusion of such limited purpose constituency in the bargaining unit would create potential for severe internal conflicts. Also, representatives may bargain at the expense of retirees¶ benefits. GENERAL ELECTRIC CO. V. NLRB - GE walked out of meeting with IUE because company objected to presence on IUE bargaining committee of representatives of other unions. It feared that IUE was using its request for preliminary discussion as device to further IUE¶s desire for joint company-wide bargaining. - There have been exceptions to general rule that either side can choose its bargaining representatives freely, but they have been rare and confined to situations infected with ill will. - A union has an interest in using experts to bargain. No good reason why it may not look to outsiders just as an employer is free to do so. The IUE technique is in response to company¶s past bargaining practices.

7.05 THE COLLECTIVE BARGAINING AGREEMENT
1. DEFINITION UNIVERSITY OF THE IMMACULATE CONCEPCION, INC v. THE HON. SECRETARY OF LABOR AND EMPLOYMENT, UNIVERSITY OF THE IMMACULATE CONCEPCION TEACHING AND NON-TEACHING EMPLOYEES UNION-FFW 374 SCRA 471 PARDO; January 23, 2002
Nature: Appeal via Certiorari Facts - University of the Immaculate Concepcion, Inc. is a non-stock, non-profit educational institution, who, on 2 occasions, met with the ICTNE Union-FFW, through the auspices of the National Conciliation and Mediation Board (NCMB), to negotiate a CBA. - The Union filed with the NCMB a Notice of Strike, the first in a series of 3 notices of strike, alleging deadlock in the CBA negotiations and unfair labor practices on the part of the petition in the form of "mass termination of teaching and non-teaching employees, interference with union activities, discrimination, and harassments." - The Univ. of IC denied the allegations in its Motion to Strike Out Notice of Strike. - During the parties' conciliation conference before the NCMB, petitioner and the Union reached an agreement on some issues (ie. ECONOMIC ISSUE~ pertaining to increase in amt of salary

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per increase in tuition fees; NON-ECONOMIC ISSUES~ union recognition and security, working schedule) - The panel of voluntary arbitrators rendered a decision excluding the secretaries, registrars, cashiers, guidance counselors and the chief of the accounting department of the petitioner from the coverage of the bargaining unit. - The University presented to the Union a draft of the CBA. After a study thereof, the Union rejected the draft on the ground that the manner of computing the net incremental proceeds has yet to be agreed upon by the parties. - The University wrote the Union insisting that the Union was bound to comply with the terms contained in the draft-CBA since said draft allegedly embodies all the items agreed upon by the parties during the conciliation sessions held by the NCMB. - the Union filed its Second Notice of Strike with the NCMB, therein alleging bargaining deadlock on "allocation of 5% (CBA) and distribution/computation of 70% incremental proceeds (RA6728)", and unfair labor practice by the petitioner in the form of "harassments, union busting and correct implementation of COLA," - After the Union's filing of its Second Notice of Strike, the University terminated the employment of 2 union members who later filed their complaints for illegal dismissal before the Regional Arbitration Branch No. XI of the NLRC in Davao City. - In the same venue, the University filed a complaint against the Union and its officers for unfair labor practices based (ie refusing to answer in writing, and within 10 days required by law, the cba proposals, refusing to bargain in good faith, by declaring a deadlock in the cba negotiations after just two days of negotiations, even if there were so many issues unresolved and still to be discussed at the bargaining table, etc) - The case was elevated to the Secretary of Labor. The Union also pushed through with the strike. - The Secretary of Labor issued an order assuming jurisdiction over the labor dispute and directed all workers to return to work within 24 hours upon receipt of the Order and for management to accept them back under the same terms and conditions prior to the strike The parties were further directed to cease and desist from committing any or all acts that might exacerbate the situation. - Eventually, the Sec of Labor found that the strike undertaken by the Union was a valid exercise of the workers' rights under the Labor Code. The Union observed the mandatory requirements/procedures for a valid strike and the issues raised in the Notice of Strike i.e., bargaining deadlock and ULP are strikeable issues specifically provided under Article 263 (c) of the Labor Code and then directed the University and the Union to execute a CBA embodying the dispositions contained herein as well as all items agreed upon by the parties. The CBA shall be effective for five (5) years starting SY 1995-96, subject to renegotiation of the economic provisions for the last two (2) years. - CA affirmed the decision of the Sec of Labor. Hence, this appeal. ISSUE: WON the CA erred in affirming the orders of the Secretary of Labor and Employment. HELD: NO. REASONING: - CA did not err in finding that there was still no new collective bargaining agreement because the parties had not reached a meeting of the minds. - A collective bargaining agreement (CBA) refers to the negotiated contract between a legitimate labor organization and the employer concerning wages, hours of work and all other terms and conditions of employment in a bargaining unit, including mandatory provisions for grievances and arbitration machineries. (Manila Fashions v. NLRC) As in all other contracts, there must be clear indications that the parties reached a meeting of the minds. - In this case, no CBA could be concluded because of what the union perceived as illegal deductions from the 70% employees' share in the tuition fee increase from which the salary increases shall be charged. Also, the manner of computing the net incremental proceeds was yet to be agreed upon by the parties. - Petitioner insisted that a new collective bargaining agreement was concluded through the conciliation proceeding before the NCMB on all

issues specified in the notice of strike. Although it is true that the university and the union may have reached an agreement on the issues raised during the collective bargaining negotiations, still no agreement was concluded by them because, among other reasons, the DOLE Secretary, who assumed jurisdiction on January 23, 1995 only was set to resolve the distribution of the salary increase of the covered employees. The Court of Appeals found that "there are many items in the draft-CBA that were not even mentioned in the minutes of the July 20, 1994 conference." - Considering the parties failed to reach an agreement regarding certain items of the CBA, they still have the duty to negotiate a new collective bargaining agreement in good faith, pursuant to the applicable provisions of the Labor Code. DISPOSITIVE: Petition Denied. The parties are enjoined to comply with the directive of the Secretary of Labor and Employment to negotiate a collective bargaining agreement in good faith.

DAVAO INTEGRATED PORT STEVEDORING SERVICES v ABARQUEZ (THE ASSOCIATION OF TRADE UNIONS) 220 SCRA 197 ROMERO; March 19, 1993
NATURE Petition for certiorari FACTS Petitioner Davao Integrated Port Stevedoring Services (petitioner-company) and private respondent ATU-TUCP (Union), the exclusive collective bargaining agent of the rank and file workers of petitioner-company, entered into a collective bargaining agreement (CBA) which, under Sections 1 and 3, Article VIII thereof, provide for sick leave with pay benefits each year to its employees who have rendered at least one year of service with the company. Upon its renewal, the provisions for sick leave with pay benefits were reproduced under Sections 1 and 3, Article VIII of the new CBA, but the coverage of the said benefits was expanded to include the "present Regular Extra Labor Pool as of the signing of this Agreement." During the effectivity of the CBA (a total of three years and nine months), all the field workers of petitioner who are members of the regular labor pool and the present regular extra labor pool who had rendered at least 750 hours up to 1,500 hours were extended sick leave with pay benefits. Any unenjoyed portion thereof at the end of the current year was converted to cash and paid at the end of the said one-year period pursuant to Sections 1 and 3, Article VIII of the CBA. The number of days of their sick leave per year depends on the number of hours of service per calendar year in accordance with the schedule provided in Section 3, Article VIII of the CBA. The commutation of the unenjoyed portion of the sick leave with pay benefits of the intermittent workers or its conversion to cash was, however, discontinued or withdrawn when petitionercompany under a new assistant manager, Mr. Marzo (who replaced Beltran, Jr. upon the latter's resignation in June 1989, stopped the payment of its cash equivalent on the ground that they are not entitled to the said benefits under Sections 1 and 3 of the 1989 CBA. The Union objected to the said discontinuance of commutation or conversion to cash of the unenjoyed sick leave with pay benefits of petitioner's intermittent workers contending that it is a

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FACTS - American Rubber Company, Inc. (ARCI) is a domestic corporation existing in and incorporated under the laws of the Philippines. It owns a rubber plantation in Latuan, Isabella. It entered into a Farm Management Agreement (FMA) with Sime Darby Pilipinas, Inc. (SDPI), where SDPI was given the right to Upon failure of the parties to amicably settle the issue on the manage, administer, develop, cultivate, and improve the rubber interpretation of Sections 1 and 3, Article VIII of the 1989 CBA, the plantations as an agro-industrial development project, Union brought the matter for voluntary arbitration before the National specifically for planting rubber trees, processing of and Conciliation and Mediation Board, Regional Arbitration Branch XI at marketing of its products and providing technical expertise for a Davao City by way of complaint for enforcement of the CBA. The parties period of twenty-five years, or up to the year 2011. mutually designated public respondent Abarquez, Jr. to act as voluntary - National Federation of Labor (NFL) was the duly registered arbitrator. bargaining agent of the daily-and-monthly-paid rank-and-file After the parties had filed their respective position papers, public employees of SDPI in the Latuan rubber plantation. SDPI and respondent Abarquez, Jr. issued an Award in favor of the Union ruling NFL executed a collective bargaining agreement (CBA) in which that the regular intermittent workers are entitled to commutation of their they agreed that in case of permanent or temporary lay-off, unenjoyed sick leave with pay benefits under Sections 1 and 3 of the workers affected would be entitled to termination pay as 1989 CBA. Petitioner-company disagreed with the aforementioned ruling provided by the Labor Code. The 150 petitioners were dailyof public respondent, hence, the instant petition. and-monthly-paid employees of SDPI in the Latuan plantation Petitioner-company argued that it is clear from the language and intent and were, likewise, members of NFL. of the last sentence of Section 1, Article VIII of the 1989 CBA that only - In 1988, RA 6657, aka Comprehensive Agrarian Reform Law the regular workers whose work are not intermittent are entitled to the took effect. benefit of conversion to cash of the unenjoyed portion of sick leave, thus: - SDPI decided to cease its operations in certain plants, including ". . . And provided, however, that only those regular workers of the the one in Latuan. Company whose work are not intermittent are entitled to the herein sick - The employees were given ½ month pay for every year of leave privilege." service as separation pay, pursuant to the CBA. They were ISSUE made to sign quitclaim, which they said they entered into WON public respondent¶s interpretation of Sections 1 and 3, Article VIII voluntarily. of the 1989 CBA is correct - A few months later, they filed a complaint for illegal dismissal and insufficiency of separation pay. HELD YES. - Labor arbiter, NLRC, and CA all found that there was no illegal A collective bargaining agreement (CBA), as used in Article 252 of the dismissal and that the employees were properly paid their Labor Code, refers to a contract executed upon request of either the separation pay. employer or the exclusive bargaining representative incorporating the agreement reached after negotiations with respect to wages, hours of ISSUE work and all other terms and conditions of employment, including WON the employees¶ separation pay was insufficient. proposals for adjusting any grievances or questions arising under such agreement. HELD While the terms and conditions of a CBA constitute the law between the NO. parties, it is not, however, an ordinary contract to which is applied the - The employees argue that they should have gotten 1 month per principles of law governing ordinary contracts. A CBA, as a labor year of service, pursuant to company policy. The precedents contract within the contemplation of Article 1700 of the Civil Code of the they site are not applicable. Philippines which governs the relations between labor and capital, is not - A collective bargaining agreement refers to the negotiated merely contractual in nature but impressed with public interest, thus, it contract between the legitimate labor organization and the must yield to the common good. As such, it must be construed liberally employer concerning wages, hours of work and all other terms rather than narrowly and technically, and the courts must place a and conditions of employment in the bargaining unit. During the practical and realistic construction upon it, giving due consideration to negotiations, the parties, management and union meet and the context in which it is negotiated and purpose which it is intended to convene promptly and expeditiously in good faith for the purpose serve. of negotiating an agreement. Had the daily-paid rank-and-file It is thus erroneous for petitioner to isolate Section 1, Article VIII of the employees deemed the same to be a diminution of their benefits, 1989 CBA from the other related section on sick leave with pay benefits, they should have rejected the CBA. The petitioners never specifically Section 3 thereof, in its attempt to justify the discontinuance assailed the CBA as prejudicial to them or for having been in or withdrawal of the privilege of commutation or conversion to cash of violation of Article 100 of the Labor Code. Unless annulled, the the unenjoyed portion of the sick leave benefit to regular intermittent CBA, as a contract governing the employer and the employees workers. The manner they were deprived of the privilege previously respecting the terms of employment, should prevail. recognized and extended to them by petitioner-company during the - If the separation pay was supposed to be 1 month per year of lifetime of the CBA of October 16, 1985 until three months from its service, why wasn¶t it specified in the CBA? Instead, the CBA renewal on April 15, 1989, or a period of three years and nine months, is says as provided by the LC. Art. 283 provides that in case of not only tainted with arbitrariness but likewise discriminatory in nature. closure or cessation of operations, the separation pay shall be equivalent to 1 month pay or to at least ½ month per year of Dispositive Petition dismissed service, whichever is higher. In this case, the latter is higher, so that¶s what the company gave them. Disposition Petition DENIED.

deviation from the true intent of the parties that negotiated the CBA; that it would violate the principle in labor laws that benefits already extended shall not be taken away and that it would result in discrimination between the non-intermittent and the intermittent workers of the petitioner-company.

NATIONAL FEDERATION OF LABOR v. CA (SIME DARBY PILIPINAS INC) 440 SCRA 604 CALLEJO, SR.; October 19, 2004
NATURE Petition for review of the decision of the CA

RIVERA v ESPIRITU 374 SCRA 351 QUISUMBING; January 23, 2002

NATURE Special civil action for certiorari and prohibition

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FACTS -PAL pilots affiliated with the Airline Pilots Association of the Philippines (ALPAP) went on a three-week strike, causing serious losses to the financially beleaguered flag carrier. As a result, PAL's financial situation went from bad to worse. Faced with bankruptcy, PAL adopted a rehabilitation plan and downsized its labor force by more than one-third. -PALEA went on strike to protest the retrenchment measures adopted by the airline, which affected 1,899 union members. The strike ended four days later, when PAL and PALEA agreed to a more systematic reduction in PAL's work force and the payment of separation benefits to all retrenched employees. -then President Joseph E. Estrada issued Administrative Order No. 16 creating an Inter-Agency Task Force (Task Force) to address the problems of the ailing flag carrier -PAL management submitted to the Task Force an offer by private respondent Lucio Tan, Chairman and Chief Executive Officer of PAL, of a plan to transfer shares of stock to its employees -PALEA informed the Department of Labor and Employment (DOLE) that it had no objection to a referendum on the Tan's offer. 2,799 out of 6,738 PALEA members cast their votes in the referendum under DOLE supervision held on September 21-22, 1998. Of the votes cast, 1,055 voted in favor of Tan's offer while 1,371 rejected it -PAL ceased its operations and sent notices of termination to its employees. Two days later, the PALEA board wrote President Estrada anew, seeking his intervention. PALEA offered a 10-year moratorium on strikes and similar actions and a waiver of some of the economic benefits in the existing CBA. Tan, however, rejected this counter-offer -PALEA board again wrote the President. Among the signatories to the letter were herein petitioners Rivera, Ramiso, and Aranas, as officers and/or members of the PALEA Board of Directors. PAL management accepted the PALEA proposal and the necessary referendum was scheduled. -PALEA members cast their votes in a DOLE-supervised referendum. Of the votes cast, 61% were in favor of accepting the PAL-PALEA agreement, while 34% rejected it. -seven officers and members of PALEA filed this instant petition to annul the September 27, 1998 agreement entered into between PAL and PALEA ISSUE WON the PAL-PALEA agreement of September 27, 1998, stipulating the suspension of the PAL-PALEA CBA unconstitutional and contrary to public policy? HELD NO. petitioners contend that the controverted PAL-PALEA agreement is void because it abrogated the right of workers to self-organization and their right to collective bargaining. Petitioners claim that the agreement was not meant merely to suspend the existing PAL-PALEA CBA, which expires on September 30, 2000, but also to foreclose any renegotiation or any possibility to forge a new CBA for a decade or up to 2008. It violates the "protection to labor" policy laid down by the Constitution. Under Article 253-A of the Labor Code, insofar as representation is concerned, a CBA has a term of five years, while the other provisions, except for representation, may be negotiated not later than three years after the execution. Petitioners submit that a 10-year CBA suspension is inordinately long, way beyond the maximum statutory life of a CBA, provided for in Article 253-A. By agreeing to a 10-year suspension, PALEA, in effect, abdicated the workers' constitutional right to bargain for another CBA at the mandated time. -HOWEVER, A CBA is "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.'' The primary purpose of a CBA is the stabilization of labor-management relations in order to create a climate of a sound and stable industrial peace. In construing a CBA, the courts must be practical and realistic and give due consideration to the context in which it is negotiated and the purpose

which it is intended to serve. The assailed PAL-PALEA agreement was the result of voluntary collective bargaining negotiations undertaken in the light of the severe financial situation faced by the employer, with the peculiar and unique intention of not merely promoting industrial peace at PAL, but preventing the latter's closure. We find no conflict between said agreement and Article 253-A of the Labor Code. Article 253-A has a two-fold purpose. One is to promote industrial stability and predictability. Inasmuch as the agreement sought to promote industrial peace at PAL during its rehabilitation, said agreement satisfies the first purpose of Article 253-A. The other is to assign specific timetables wherein negotiations become a matter of right and requirement. Nothing in Article 253-A, prohibits the parties from waiving or suspending the mandatory timetables and agreeing on the remedies to enforce the same. In the instant case, it was PALEA, as the exclusive bargaining agent of PAL's ground employees, that voluntarily entered into the CBA with PAL. It was also PALEA that voluntarily opted for the 10-year suspension of the CBA. Either case was the union's exercise of its right to collective bargaining. The right to free collective bargaining, after all, includes the right to suspend it. Disposition Petition DISMISSED

2. CONTENTS SEE SAMPLE CBA
EFFECT SUBSTANDARD CONTRACT

ART. 239. Grounds for cancellation of union registration. The following shall constitute grounds for cancellation of union registration: (f) Entering into collective bargaining agreements which provide terms and conditions of employment below minimum standards established by law; * remember! A239 has been amended by RA 8491

DURATION AND RE-NEGOTIATION

GRIEVANCE PROCEDURE
ART. 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).

LUZON DEVELOPMENT BANK V ASSOCIATION OF DEVELOPMENT BANK EMPLOYEES 249 SCRA 162

ART. 260. Grievance machinery and voluntary arbitration. - The parties to a Collective Bargaining A2010 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 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.

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-Arbitration may either be compulsory or voluntary. -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. -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. -In the Philippine context, the parties to a Collective Bargaining Agreement (CBA) are required to include therein provisions for a machinery for the resolution of grievances arising from the interpretation or implementation of the CBA or company personnel policies. -For this purpose, parties to a CBA shall name and designate therein a voluntary arbitrator or a panel of arbitrators, or include a procedure for their selection, preferably from those accredited by the National Conciliation and Mediation Board (NCMB). Disposition The Court resolved to REFER this case to the Court of Appeals

ROMERO; October 6, 1995
NATURE Petition for certiorari and prohibition seeking to set aside the decision of the Voluntary Arbitrator and to prohibit her from enforcing the same FACTS -Luzon Development Bank (LDB) and the Association of Luzon Development Bank Employees (ALDBE) submitted to arbitration to resolve WON the company has violated the Collective Bargaining Agreement provision and the Memorandum of Agreement dated April 1994, on promotion -The parties agreed to submit their respective Position Papers on December 1-15, 1994. -Atty. Ester S. Garcia, in her capacity as Voluntary Arbitrator, received ALDBE's Position Paper on January 18, 1995. -LDB, on the other hand, failed to submit its Position Paper -On May 24, 1995, without LDB's Position Paper, the Voluntary Arbitrator rendered a decision finding that the Bank has not adhered to the Collective Bargaining Agreement provision nor the Memorandum of Agreement on promotion. -Hence, this petition ISSUE WON the Voluntary Arbitrator erred in finding that the Bank has not adhered to the Collective Bargaining Agreement provision nor the Memorandum of Agreement on promotion (the Court referred the case to the CA so the issue wasn¶t resolved«it said that elevating a decision or award of a voluntary arbitrator to the Supreme Court on a petition for certiorari is in effect equating the voluntary arbitrator with the NLRC or the Court of Appeals, which in its view is illogical and imposes an unnecessary burden upon it) HELD (only obiter« pertaining to topic) -In labor law context, arbitration is the reference of a labor dispute to an impartial third person for determination on the basis of evidence and arguments presented by such parties who have bound themselves to accept the decision of the arbitrator as final and binding.

NAVARRO V DAMASCO, BUSCO SUGAR MILLING 246 SCRA 260 QUIASON; June 16, 1969
NATURE Petition for certiorari to reverse the Decision of the Voluntary Arbitrator Damasco, declaring as valid the separation from employment of petitioner FACTS - Navarro III was employed as typist of BUSCO Sugar Milling at its plant in Quezon, Bukidnon. - One time, he went to visit Mercy Baylas, a co-employee he was courting, at the ladies' dormitory inside the compound of the company. Upon seeing him, Baylas hid behind the divider at the reception room. He still saw her, followed her, and after taking hold of her left hand, pulled her towards him. The force caused her to fall on the floor. He then placed himself on top of her. The dormitory housekeeper, responded to Baylas' shouts for help. - According to the medical report issued by Dr. Maraat, Baylas complained of pains on her shoulder and left foot. - Navarro was then informed of the complaint against him and was placed under preventive suspension. He was dismissed from the service for having violated paragraph 3.B (Conduct and Behavior) of the Code of Employee Discipline. This includes: inflicting bodily injury, immoral conduct within company premises, improper conduct and acts of gross discourtesy or disrespect. - President of the Mindanao Sugar Workers Union, for and in behalf of petitioner, and Jaime J. Javier, Personnel Officer of the company, agreed to submit the case of petitioner to voluntary arbitration. - Navarro contends that the grievance procedure was not followed hence the Voluntary Arbitrator should not have taken cognizance of the case. ISSUE

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WON grievance machinery provisions should have been invoked HELD NO Reasoning The instant case is not a grievance that must be submitted to the grievance machinery. What are subject of the grievance procedure for adjustment and resolution are grievances arising from the interpretation or implementation of the collective bargaining agreement. - The acts of petitioner involved a violation of the Code of Employee Discipline, particularly the provision penalizing the immoral conduct of employees. There was no justification for petitioner to invoke the grievance machinery provisions. Disposition Decision of Voluntary Arbitrator is AFFIRMED.

SMC v. CONFESSOR (cha Mendoza) GENERAL MILLING CORPORATION v CA (GMC INDEPENDENT LABOR UNION) 422 SCRA 514 QUISUMBING; February 11, 2004
FACTS -GMC employed 190 workers in its two plants, all of whom were members of GMC-ILO (duly certified bargaining agent). GMC and the union concluded a CBA) which included the issue of representation effective for a term of three years. The CBA was effective for three years, to expire on November 30, 1991. -A day before the expiration of the CBA, the union sent GMC a proposed CBA, with a request that a counter-proposal be submitted within 10 days. As early as October 1991, however, GMC had received collective and individual letters from workers who stated that they had withdrawn from their union membership, on grounds of religious affiliation and personal differences. Believing that the union no longer had standing to negotiate a CBA, GMC did not send any counter-proposal, believing that there was no basis to negotiate with a union which no longer existed. -The union officers disclaimed any massive disaffiliation or resignation from the union and submitted a manifesto, signed by its members, stating that they had not withdrawn from the union. -GMC dismissed Tumbiga, a union member, on the ground of incompetence. The union protested and requested GMC to submit the matter to the grievance procedure provided in the CBA. GMC denied the union¶s request. Thus, the union filed a complaint against GMC with the Labor Arbiter alleging ULP for: (1) refusal to bargain collectively; (2) interference with the right to self-organization; and (3) discrimination. The labor arbiter dismissed the case with the recommendation that a petition for certification election be held to determine if the union still enjoyed the support of the workers. - Upon appeal, the NLRC reversed the LA¶s decision. But NLRC later reversed its own decision. The CA reinstated NLRC¶s first decision, ruling in favor of the union. ISSUE 1. WON GMC is guilty of ULP for violating the duty to bargain collectively and/or interfering with the right of its employees to selforganization 2. WON the CA erred in imposing upon GMC the draft CBA proposed by the union for two years to begin from the expiration of the original CBA. HELD 1. YES

3
Section 2, Article X of the Collective Bargaining Agreement specifies the instances when the grievance machinery may be availed of, thus: "Any protest or misunderstanding concerning any ruling, practice or working conditions in the Company, or any dispute arising as to the meaning, application or claim of violation of any provision of this Agreement or any complaint that any employee may have against the COMPANY shall constitute a grievance."

ART. 253-A of the LC mandates that the representation provision of a CBA should last for five years. The relation between labor and management should be undisturbed until the last 60 days of the fifth year. Hence, it is indisputable that when the union requested for a renegotiation of the economic terms of the CBA, it was still the certified collective bargaining agent of the workers, because it was seeking said renegotiation within 5 years from the date of effectivity of the CBA. The union¶s proposal was also submitted within the prescribed 3-year period from the date of effectivity of the CBA, albeit just before the last day of said period. It was obvious that GMC had no valid reason to refuse to negotiate in good faith with the union. For refusing to send a counter-proposal to the union and to bargain anew on the economic terms of the CBA, the company committed an unfair labor practice under Article 248 of the Labor Code, which provides that: ART. 248. Unfair labor practices of employers. ± It shall be unlawful for an employer to commit any of the following unfair labor practice: (g) To violate the duty to bargain collectively as prescribed by this Code; Article 252 of the Labor Code elucidates the meaning of the phrase ³duty to bargain collectively,´ thus: ART. 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.... The crucial question whether or not a party has met his statutory duty to bargain in good faith typically turn 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. The effect of an employer¶s or a union¶s actions individually is not the test of good-faith bargaining, but the impact of all such occasions or actions, considered as a whole. Under Article 252, both parties are required to perform their mutual obligation to meet and convene promptly and expeditiously in good faith for the purpose of negotiating an agreement. The union lived up to this obligation when it presented proposals for a new CBA to GMC within 3 years from the effectivity of the original CBA. But GMC failed in its duty under Article 252. What it did was to devise a flimsy excuse, by questioning the existence of the union and the status of its membership to prevent any negotiation. It bears stressing that the procedure in collective bargaining prescribed by the Code is mandatory because of the basic interest of the state in ensuring lasting industrial peace. Thus: 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. GMC¶s failure to make a timely reply to the proposals presented by the union is indicative of its utter lack of interest in bargaining with the union. Its excuse that it felt the union no longer represented the workers, was mainly dilatory as it turned out to be utterly baseless. GMC¶s refusal to make a counter-proposal to the union¶s proposal for CBA negotiation is an indication of its bad faith. Where the employer did not even bother to submit an answer to the bargaining proposals of the union, there is a clear evasion of the duty to bargain collectively. 2. NO. The Code provides: ART. 253. Duty to bargain collectively when there exists a collective bargaining agreement. ± ....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 [prior to its expiration date] and/or until a new agreement is reached by the parties. The provision mandates the parties to keep the status quo while they are still in the process of working out their respective

(A231 cont¶d) The Bureau or Regional Office shall assess the employer for every Collective Bargaining Agreement a 178registration fee of not less than one thousand pesos (P1,000.00) or in any other amount as may be deemed appropriate and necessary by the Secretary of Labor and Employment for the effective and efficient administration of the Voluntary Arbitration Program. Any amount collected under this provision shall accrue to the Special Voluntary Arbitration Fund. The Bureau shall also maintain a file and shall undertake or assist in the publication of all final decisions, orders and awards of the Secretary of Labor and Employment, Regional Directors and the Commission. (As amended by Section 15, Republic Act No. 6715, March 21, 1989).

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proposal and counter proposal. The general rule is that when a CBA already exists, its provision shall continue to govern the relationship between the parties, until a new one is agreed upon. The rule necessarily presupposes that all other things are equal. That is, that neither party is guilty of bad faith. However, when one of the parties abuses this grace period by purposely delaying the bargaining process, a departure from the general rule is warranted. It would be unfair to the union and its members if the terms and conditions contained in the old CBA would continue to be imposed on GMC¶s employees for the remaining two (2) years of the CBA¶s duration. We are not inclined to gratify GMC with an extended term of the old CBA after it resorted to delaying tactics to prevent negotiations. Since it was GMC which violated the duty to bargain collectively, based on Kiok Loy and Divine Word University of Tacloban, it had lost its statutory right to negotiate or renegotiate the terms and conditions of the draft CBA proposed by the union. Under ordinary circumstances, 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 allowed to resort with impunity to schemes feigning negotiations by going through empty gestures. Thus, by imposing on GMC the provisions of the draft CBA proposed by the union, the interests of equity and fair play were properly served and both parties regained equal footing, which was lost when GMC thwarted the negotiations for new economic terms of the CBA.

3. REGISTRATION-231

ART. 231. Registry of unions and file of collective bargaining agreements. - The Bureau shall keep a registry of legitimate labor organizations. The Bureau shall also maintain a file of all collective bargaining agreements and other related agreements and records of settlement of labor disputes and copies of orders and decisions of voluntary arbitrators. The file shall be open and accessible to interested parties under conditions prescribed by the Secretary of Labor and Employment, provided that no specific information submitted in confidence shall be disclosed unless authorized by the Secretary, or when it is at issue in any judicial litigation, or when public interest or national security so requires. Within thirty (30) days from the execution of a Collective Bargaining Agreement, the parties shall submit copies of the same directly to the Bureau or the Regional Offices of the Department of Labor and Employment for registration, accompanied with verified proofs of its posting in two conspicuous places in the place of work and ratification by the majority of all the workers in the bargaining unit. The Bureau or Regional Offices shall act upon the application for registration of such Collective Bargaining Agreement within five (5) calendar days from receipt thereof. The Regional Offices shall furnish the Bureau with a copy of the Collective Bargaining Agreement within five (5) days from its submission.

ART. 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 labormanagement 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).
NATURE Petition for certiorari with prayer for issuance of preliminary injunction FACTS - The National Federation of Labor (NFL) was certified as the sole and exclusive bargaining representative of all regular rankand-file EE¶s of petitioner. NFL began negotiations which petitioner resisted, prompting NFL to file a complaint for unfair labor practices (ULP) on the ground of refusal to bargain collectively. The Executive Labor Arbiter declared petitioner guilty of ULP and the CBA proposals of NFL as the CBA between the bargaining unit and petitioner. - Petitioner appealed, which was dismissed by NLRC, as with its MFR. Its petition for certiorari was later denied by the Court as well. The records were remanded to the arbitration branch of origin wherein Labor Arbiter Villena ordered petitioner to pay 142 EEs the benefits and amounts due to them under the CBA. Petitioner complied, quitclaims were executed, and NFL manifested it would not appeal. -Still, a petition for relief was later filed by 186 of the private respondents (Aklit and 350 others) claiming to have been excluded from enjoying the benefits of the CBA. NLRC issued an order granting said CBA benefits. Petitioner filed an MFR. Private respondents, including the 186, filed individual money claims, all of which were dismissed and EE¶s appealed. NLRC issued a resolution directing petitioner to pay individual claimants their CBA benefits in the aggregate amount of P13,559,510. Hence this petition.

4. CONTRACT BENEFICIARIES- 255 BENEFICIARIES NEW PACIFIC TIMBER & SUPPLY CO. V NLRC (BUAT ET AL) 328 SCRA 404 KAPUNAN; March 17, 2000

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ISSUE/S WON NLRC committed grave abuse of discretion in ruling that private respondents ³Aklit and 350 others´ are entitled to the CBA benefits despite the fact that they weren¶t members of the bargaining unit during the CBA¶s term, and weren¶t even EE¶s of petitioner HELD 1. NO Ratio In a long line of cases, the Court has held that when a collective bargaining contract is entered into by the union representing the EE¶s and ER, even the non-member EE¶s are entitled to the benefits of the contract. Reasoning Petitioner argues that private respondents cannot claim benefits as they were only hired after the term of the CBA and were thus not parties to the agreement. However, to grant such benefits only to members of the union without valid reason would constitute undue discrimination against nonmembers. A laborer may even claim benefits from the CBA entered into by the company and union of which he was a member at the time, after he has resigned from said union. -Petitioner argues that the CBA benefits sought such as wage increases in 1985 were stipulated only for the years 1981-84 and as such, there was no contractual basis for the grant of said benefits from 1985 onwards. However, the Court has held that a CBA, even though it has expired, continues to have legal effect until a new one is entered into; parties to the CBA must maintain the status quo during the 60-day period (to serve written notice to terminate CBA 60-days prior to expiration) or until a new agreement is reached. To hold otherwise would be to create a gap during which no agreement at all would govern from the time the old CBA expires until the new one is entered into. Disposition Petition for certiorari is dismissed.

therein imposed is not fulfilled, the aggrieved party has the right to go to court for redress.´ (Mactan Workers Union vs. Aboitiz) DISPOSITION Petition is DENIED.

MANALANG v. ARTEX DEV¶T CO, INC (GIULIA)
MINDANAO STEEL CORP. VS MINSTEEL FREE WORKERS ORGANIZATION 424 SCRA 614 SANDOVAL-GUTIERREZ; March 4, 2004 FACTS Mindanao Steel Corporation and Minsteel Free Workers Organization MINFREWO-NFL Cagayan de Oro City (Minsteel) executed a CBA providing for an increase of P20.00 in the workers¶ daily wage. Prompted by the fuel price increase, the Regional Tripartite Wages and Productivity Board (RTWPB) of Region X, Northern Mindanao, Cagayan de Oro City issued an Interim Wage Order granting an ECOLA/temporary allowance for 3 months pending the approval of the wage increase being petitioned by the workers. Mindanao refused to implement the Interim Wage Order, prompting Minsteel to file with the National Mediation and Conciliation Board (NCMB) a complaint for payment of ECOLA against the former. Then the parties agreed to submit the case for voluntary arbitration. The Voluntary Arbitrator rendered a decision ordering Mindanao to pay Minsteel¶s members and other workers their ECOLA. Mindanao then filed a motion for reconsideration which was denied. Mindanao filed a petitioner for certiorari with the CA. CA affirmed the decision of the Arbitrator. Hence, this petition for review on certiorari. Mindanao contends that it is exempt from paying the ECOLA because pursuant to the CBA, it already granted a wage increase of P20.00 a day. Likewise, Mindanao claims it is entitled to creditable benefits on the basis of Section 7 of Interim Wage Order No. RX-02 which provides:³Wage increases, rice allowance (in kind or cash), and other allowances granted by employers to their workers because of, or in anticipation of the fuel price hikes are creditable, provided that if the amount is less than that prescribed in this Interim Wage Order, the employer shall give the difference.´ Along the same line, Mindanao maintains that under Section 5 its grant of wage increase to its workers pursuant to the CBA is considered compliance with the Order, thus: ³Section 5. Creditable Benefits Any wage increases or adjustments granted between November 22, 1990 and January 06, 1991 shall be considered as compliance with the Order provided that if the amount is less than that prescribed, the employer shall pay the difference. ISSUE WON Mindanao is exempt from paying the ECOLA in light of the CBA entered into by the parties. HELD NO. Pertinent is Section 3, Article VII of the CBA which provides: ³It is hereby agreed that these salary increases shall be exclusive of any wage increase that may be provided by law as a result of any economic change.´ The above provision is clear that the salary increases, such as the P20.00 provided under the CBA, shall not include any wage increase that may be provided by law as a result of any economic change. Hence, aside from the P20.00 CBA wage increase, Minsteel¶s members are also entitled to the ECOLA under the Interim Wage Order. In Mactan Workers Union vs. Aboitiz, it was held that ³the

5. CONTRACT ADMINISTRATION AND ENFORCEMENT 5.1 NATURE OF CONTRACT BABCOCK-HITACHI (PHILS.), INC vs BABCOCKHITACHI (PHILS.), INC., MAKATI EMPLOYEES UNION (BHPIMEU) 453 SCRA 156 SANDOVAL-GUTIERREZ; Mar 10 , 2005
NATURE Petition for review on certiorari under Rule 45. FACTS Some employees of Babcock-Hitachi Phils were transferred from Makati to Bauan Batnagas, in line with the company¶s plan to transfer its Design Department in order to improve the operating efficiency and coordination among its various departments. - The said employees demanded relocation allowance as provided for in their CBA. However, the company refused saying that under Policy Statement No. BHPI-G-044A, they are not entitled to it considering that they are residents of Bauan or its adjacent towns. ISSUE WON union members are entitled to relocation allowance in light of the CBA between the parties. HELD YES. Ratio Any doubt or ambiguity in the contract between management and the union members should be resolved in favor of the latter (Article 1702 of the Civil Code) Contracts which are not ambiguous are to be interpreted according to their literal meaning and not beyond their obvious intendment. ³the terms and conditions of a collective bargaining contract constitute the law between the parties. Those who are entitled to its benefits can invoke its provisions. In the event that an obligation

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terms and conditions of a collective bargaining contract 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.´ Finally, the P20.00 daily wage increase granted by Mindanao to its employees under the CBA can not be considered as creditable benefit or compliance with the Interim Wage Order because such was intended as a CBA or negotiated wage increase and not ³because of, or in anticipation of the fuel price hikes on December 5, 1990 x x x.´ Dispositive Petition is DENIED. The assailed Decision dated May 30, 1997 and Resolution dated August 22, 1997 rendered by the CA in are AFFIRMED.

relative to the employment qualification standards of recommendees of retired/resigned, deceased or disabled employees of respondent who are members of petitioner. However, in determining the employment qualification standards for said recommendees, the VA should have relied on the November 7, 1995 Guidelines issued by respondent, which reads: D. Definition of the phrase ³immediate member of the family of an employee´ 1. The phrase ³immediate member of the family of an employee´ shall refer to the employee¶s legitimate children and in default thereof to the employee¶s collateral relatives within the third civil degree. 2. A resigned/retired employee may be allowed to recommend a collateral relative within the third civil degree (e.g., brother, sister, nephew or niece) as his/her replacement only in the following cases: a. Where the retired/resigned employee is single or if married has no legitimate children. b. Where the retired/resigned employee¶s children are still minors (below 18 years old) at the time of his/her separation from the company. (Emphasis added) E. General Provisions

United Kimberly Employees Union vs Kimberly Clark 484 SCRA 187 Callejo, Sr., ; March 6, 2006
NATURE Petition for Review.Certiorari FACTS - Petitioner is the labor union representing rank and file employees of respondent. Way back in 1980, the parties agreed to include in their CBA a provision which states that the company agrees to employ immediate relative of an employee who had retired, resigned, died provided that the employee had rendered at least ten years service. There were no other standards set with regard the acceptance of the said recommendees and as a matter of fact, evem high school graduates were accepted. - In 1991, a case was filed against the company for refusing to employ a nephew of a retiring employee (Kimberly Clark vs Lorredo) as apparently the retiring employee had children who he did not recommend and the company was questioning this. In any case, the company lost in this case but as part of the ruling of the Court, it was stated that Kimberly was not obliged to unconditionally accept the recommendee since the latter must still meet the required employment standard theretofore set by it. Even a qualified recommendee would be hired only on a ³probationary status.´ As such, KCPI was not left without its own safeguards under the agreement. - In 1995, the company issued the now questioned guidelines which among others required that such recommendees must be at least 18 years of age but not more than 30 years old at the time of the hiring, and (b) have completed, after graduating from high school, at least a twoyear technical/vocational course or a third year level of college education. Moreover, where both husband and wife are employees of the company, they shall be treated as one family; hence, only one of the spouses would be allowed to avail of the benefit. - The Union and the company agreed to postpone the implementation of said guidelines until January 1, 1997 but only with respect to the educational qualification. And the guidelines were in fact implemented in the second half of 1998. A voluntary arbitrator ruled on the controversy saying that the company cannot upgrade the educational qualification as this is contrary to what has been in existence and what had been a practice. - Appeal was filed with the CA which reversed the resolution of the voluntary arbitrator with regard the upgrade of the qualification of the recommendee. Hence this appeal. ISSUE/S WON the CA erred in ruling that, under Article XX, Section 1 of the 1997 CBA, respondent is required to hire only those recommendees of retired/resigned, deceased or disabled members of petitioner who had completed at least a two-year technical/vocational course or a third-year level of college education HELD NO. In the present case, the parties are in agreement that, on its face, Article XX, Section 1 of their 1997 CBA does not contain any provision

1. The privilege to recommend a replacement can be exercised by the employee concerned only once. Thus, in the following cases, a recommendee who has been hired on probationary status can no longer be substituted with another recommendee. a. where the recommendee fails to pass in his performance evaluation. b. where the recommendee resigns without completing his probationary period. c. where the recommendee is dismissed for cause. d. where the recommendee dies during his probationary 4[48] period. Respondent issued said Guidelines in light of the ruling of this Court in Kimberly Clark Philippines v. Lorredo. Respondent saw it imperative to do away with its practice of accommodating recommendees who were mere high school graduates, and to require higher employment standards for them. By agreement of the parties, the implementation of the Guidelines was deferred until January 1, 1997, unless revoked or amended by the 1997 CBA. Petitioner proposed that the practice of hiring recommendees of retired/resigned, deceased or disabled employees who were union members, who were at least high school graduates, be included in their CBA, but respondent did not agree. Hence, Article XX, Section 1 of the 1997 CBA of the parties remained intact. There was thus no more legal bar for respondent to implement the November 7, 1995 Guidelines. By executing the 1997 CBA, in its present form, petitioner is bound by the terms and conditions therein set forth. The Court has recognized in numerous instances the undoubted right of the employer to regulate, according to his own discretion and best judgment, all aspects of employment, including but not limited to, work assignments and supervision, working methods and regulations, time, place and manner of work, processes to be followed, and hiring, supervision, transfer, discipline, lay off, dismissal and recall of workers. Encompassing though it could be, the exercise of this right is not absolute. Management prerogative must be exercised in good faith for the advancement of the employer¶s interest and not for the purpose of defeating or circumventing the rights of the

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employees under special laws, valid agreements such as the individual contract of employment and the collective bargaining agreement, and 5[49] general principles of justice and fair play. In this case, the Court finds that respondent acted in accord with the CBA and the November 7, 1995 Guidelines, which, by agreement of the parties, may be implemented by respondent after January 1, 1997. Disposition Petition is denied.

brusque attitude and bad language, aside from being habitually absent and late ISSUE WON the stipulation in a Collective Bargaining Agreement (CBA) that allows management to retire an employee in its employ for a predetermined lengthy period but who has not yet reached the minimum compulsory retirement age provided in the Labor Code is valid [WON the retirement id valid] HELD YES Ratio By their acceptance of the CBA, the Union and its members are obliged to abide by the commitments and limitations they had agreed to cede to management. The questioned retirement provisions cannot be deemed as an imposition foisted on the Union, which very well had the right to have refused to agree to allowing management to retire employees with at least 20 years of service. It should not be taken to mean that retirement provisions agreed upon in the CBA are absolutely beyond the ambit of judicial review and nullification. A CBA, as a labor contract, is not merely contractual in nature but impressed with public interest. If the retirement provisions in the CBA run contrary to law, public morals, or public policy, such provisions may very well be voided. Certainly, a CBA provision or employment contract that would allow management to subvert security of tenure and allow it to unilaterally ³retire´ employees after one month of service cannot be upheld. Neither will the Court sustain a retirement clause that entitles the retiring employee to benefits less than what is guaranteed under Article 287 of the Labor Code, pursuant to the provision¶s express proviso thereto in the provision. Reasoning - Pursuant to the CBA, School has the option to retire an employee upon reaching the age limit of 60 or after having rendered at least 20 years of service to the School, the last 3 years of which must be continuous. Retirement is a different specie of termination of employment from dismissal for just or authorized causes under Articles 282 and 283 of the Labor Code. While in all three cases, the employee to be terminated may be unwilling to part from service, there are eminently higher standards to be met by the employer validly exercising the prerogative to dismiss for just or authorized causes. In those two instances, it is indispensable that the employer establish the existence of just or authorized causes for dismissal as spelled out in the Labor Code. Retirement, on the other hand, is the result of a bilateral act of the parties, a voluntary agreement between the employer and the employee whereby the latter after reaching a certain age agrees and/or consents to sever his employment with the former. - ART. 287. Retirement. ± Any employee may be retired upon reaching the retirement age established in the collective bargaining agreement or other applicable employment contract. In case of retirement, the employee shall be entitled to receive such retirement benefits as he may have earned under existing laws and any collective bargaining agreement and other agreements: Provided, however, That an employee¶s retirement benefits under any collective bargaining agreement and other agreements shall not be less than those provided herein. In the absence of a retirement plan or agreement providing for retirement benefits of employees in the establishment, an employee upon reaching the age of sixty (60) years or more, but not beyond sixty-five (65) years which is hereby declared the compulsory retirement age, who has served at least five (5) years in the said establishment, may retire and shall be entitled to retirement pay equivalent to at least one-half (1/2) month salary for every year of service, a fraction of at least six (6) months being considered as one whole year. - CBA established 60 as the compulsory retirement age. However, it is not alleged that either Javier or Llagas had reached the compulsory retirement age of 60 years, but instead that they had rendered at least 20 years of service in the School,

CAINTA CATHOLIC SCHOOL V CAINTA CATHOLIC SCHOOL EMPLOYEES UNION 489 SCRA 468 TINGA; May 4, 2006
NATURE Petition for review on certiorari under Rule 45 assailing CA Decision which reversed the Resolutions of the National Labor Relations Commission FACTS - 10 September 1993 > Union held an election of officers, with Mrs. Llagas being elected as President; Javier, Vice-President; Villegas - 15 October 1993 > School retired Llagas and Javier, who had rendered more than 20 years of continuous service, pursuant to Section 2, Article X of the CBA [An employee may be retired, either upon application by the employee himself or by the decision of the Director of the School, upon reaching the age of 60 or after having rendered at least twenty (20) years of service to the School the last 3 years of which must be continuous] - 27 July 1994 > Union filed a complaint for unfair labor practice before the NLRC - 31 January 1997 > NLRC rendered a Resolution favoring the School that the retirement of Llagas and Javier is legal as the School was merely exercising an option under the CBA - 9 July 1997 > Union filed a petition for certiorari before this Court and the Court issued a TRO against the enforcement of the resolutions - St. Martin Funeral Homes v. NLRC > case was referred to CA - 20 August 2001 > CA gave due course and granted the petition to annul and set aside Resolutions of the NLRC; while dismissing the petition for contempt for lack of merit. - In reversing NLRC decision, CA construed the retirement of Llagas and Javier as an act amounting to unfair labor practice as they were a new and different breed of union leaders ± assertive, militant and independent ± the exact opposite of former union president Victor Javier who seemed to be passive, cooperative and pacific. The school saw the two as threats which it could not control, and faced with a very uncomfortable situation of having to contend with an aggressive union which just dominated the high school faculty club, the school decided to ³nip in the bud´ the reactivated union by retiring its most prominent leaders (union busting?) - The School avers that the retirement of Llagas and Javier was clearly in accordance with a specific right granted under the CBA and that no unfair labor practice is committed by management if the retirement was made in accord with management prerogative or in case of voluntary retirement, upon approval of management. - NLRC, however, gave another justification to sustain the validity of the two union officers¶ forcible retirement: > retirement of Llagas has become inevitable because, being a managerial employee by reason of her position as Dean of Student Affairs, she accepted the Union presidency. She lost the trust and confidence on her by the SCHOOL as she occupied a managerial position as Dean of Student Affairs. . . Being also the union president, she has allowed her loyalties to be divided between the administration and the union. > Javier¶s retirement was decided upon after an evaluation shows that she was not performing well as her students were complaining about her

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the last 3 years continuous. Clearly, CBA provision allows the employee to be retired by the School even before reaching the age of 60, provided that he/she had rendered 20 years of service. Would such a stipulation be valid? Jurisprudence affirms the position of the School. - Pantranco North Express, Inc. v. NLRC > Pantranco allowed the employee to be compulsorily retired upon reaching the age of 60 ³or upon completing 25 years of service. On the basis of the CBA, private respondent was compulsorily retired by Pantranco at the age of 52, after 25 years of service. Interpreting Article 287, the Court ruled that the Labor Code permitted employers and employees to fix the applicable retirement age at below 60 years of age. Moreover, the Court also held that there was no illegal dismissal since it was the CBA itself that incorporated the agreement reached between the employer and the bargaining agent with respect to the terms and conditions of employment; hence, when the private respondent ratified the CBA with his union, he concurrently agreed to conform to and abide by its provisions. - Progressive Development Corporation v. NLRC > CBA stipulated that an employee with 20 years of service, regardless of age, may be retired at his option or at the option of the company. The stipulation was used by management to compulsorily retire two employees with more than 20 years of service, at the ages of 45 and 38. The Court affirmed the validity of the stipulation on retirement as consistent with Article 287 of the Labor Code. - Philippine Airlines, Inc. v. Airline Pilots Association of the Phils. > PAL-ALPAP Retirement Plan, the Plan having subsequently been misquoted in the CBA mutually negotiated by the parties. The Plan authorized PAL to exercise the option of retirement over pilots who had chosen not to retire after completing 20 years of service or logging over 20,000 hours for PAL. After PAL exercised such option over a pilot, ALPAP charged PAL with illegal dismissal and union-busting. While the Secretary of Labor upheld the unilateral retirement, it nonetheless ruled that PAL should first consult with the pilot to be retired before it could exercise such option. The Court struck down that proviso, ruling that ³the requirement to consult the pilots prior to their retirement defeats the exercise by management of its option to retire the said employees, [giving] the pilot concerned an undue prerogative to assail the decision of management.´ Obiter - Llagas and Javier were indeed managerial and supervisory employees, respectively. Having established that Llagas is a managerial employee, she is proscribed from joining a labor union, more so being elected as union officer. In the case of Javier, a supervisory employee, she may join a labor union composed only of supervisory employees. Finding both union officers to be employees not belonging to the rank-and-file, their membership in the Union has become questionable, rendering the Union inutile to represent their cause.

5.2 GRIEVANCE
PROCEDURE-260;255 DISPUTE SETTLEMENT: ISSUES AND INDIVIDUAL GRIEVANCE

ART. 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 decisionmaking 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).

ART. 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 Bargaining Agreement, which shall act with the same force and effect as if the Arbitrator or

MASTER IRON LABOR UNION (MILU) v NLRC (MASTER IRON WORKS AND CONSTRUCTION CORP 219 SCRA 47 MELO; February 17, 1993
NATURE Petition for review on certiorari to annul and set aside decision of NLRC FACTS - Master Iron (MI) and its labor union (MILU) entered into a CBA in Feb 1987. It provided that ³there shall be no strike and no lookout, stoppage or shutdown of work, or any other interference with any of the operation of MI during the term of this CBA, unless allowed and permitted by law.´ - Right after signing the CBA, MI subcontracted outside workers to do the usual jobs done by its regular workers including those done outside of the company plant. Thus, regular workers were scheduled by management to work on a rotation basis allegedly to prevent financial losses thereby allowing the workers only 10 working days/month. MILU requested implementation of the grievance procedure which had also been agreed upon in the CBA, but MI ignored the request.

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- MILU filed a notice of strike, and upon intervention of DOLE, it was agreed upon that MI would give back the usual work to its regular employees who were members of MILU - Notwithstanding the agreement, MI continued the practice of hiring outside workers. MILU again went on a strike. MI sought to have the strike declared illegal while MILU filed complaint for unfair labor practice. - LA and NLRC decided for MI (strike was illegal for failure to exhaust the provision in the CBA on grievance procedure), hence this petition ISSUE 1. WON the strike was illegal for failure to exhaust grievance procedure HELD 1. NO Ratio MI¶s refusal to heed MILU¶s request to undergo the grievance procedure clearly demonstrated its lack of intent to abide by the terms of the CBA, thus committing an unfair labor practice Reasoning MI¶s failure to traverse MILU¶s allegation that NLRC abused its discretion in holding that the provision on grievance procedure had not been exhausted clearly sustains such allegation and upholds the MILU¶s contention that MI refused to undergo said procedure. It should be remembered that a grievance procedure is part of the continuous process of collective bargaining. It is intended to promote a friendly dialogue between labor and management as a means of maintaining industrial peace. On nature of the strike: MILU contend that notwithstanding the CBA¶s non-strike provision, the strike was legal because the reasons therefor are non-economic in nature. On the other hand, in holding that the strike was illegal, NLRC relied solely on the no-strike no-lockout provision of the CBA. As the SC has held, a no-strike clause in a CBA is applicable only to economic strikes. Corollarily, if the strike is founded on an unfair labor practice of the employer, a strike declared by the union cannot be considered a violation of the no-strike clause. - An economic strike is defined as one which is to force wage or other concessions from the employer which he is not required by law to grant. Here, MILU enumerated in their notice of strike the ff grounds: violation of CBA or MI¶s practice of subcontracting workers; discrimination; coercion of employees; unreasonable suspension of union officials, and unreasonable refusal to entertain grievance. MILU is not asking for an economic benefit not already agreed upon, but is merely asking for the implementation of the same. Prof. Perfecto Fernandez: economic strike involves issues relating to demands for higher wages, higher pension or overtime rates, pensions, profit sharing, shorter working hours, fewer work days for the same pay, elimination of night work, lower retirement age, more healthful working conditions, better health services, sanitation and more safety appliances. The demands were within the power of MI to grant and therefore the strike was not an economic strike. Disposition Petition is granted.

pursuant to the grievance machinery Step I of the CBA regarding the illegal/questionable salary deductions and inventory of bonded goods and merchandise being done by catering service personnel which they believed should not be their duty. The grievance was submitted to the office of Mr. Reynaldo Abad who at the time was on vacation leave. The grievants thru the shop steward wrote a letter on December 5, 1984 addressed to the office of Mr. Abad, who was still on leave at the time, that inasmuch as no reply was made to their grievance which 'was duly received by your secretary' and considering that petitioner had only five days to resolve the grievance as provided for in the CBA, Section 2, Article IV of the PAL-PALEA Collective Bargaining Agreement (hereinafter, CBA), to wit: "Section 2-Processing of Grievances xxx STEP 1-Any employee who believes that he has a justifiable grievance shall take the matter up with his shop steward. If the shop steward feels there is justification for taking the matter up with the Company, be shall record the grievance on the grievance form heretofore agreed upon by the parties. Two (2) copies of the grievance form properly filled, accepted, and signed shall then be presented to and discussed by the shop steward with the division head. The division head shall answer the grievance within five (5) days from the date of presentation by inserting his decision on the grievance form, signing and dating same, and returning one copy to the shop steward. If the division head fails to act within the five (5)-day regl(e)mentary period, the grievance must be resolved in favor of the aggrieved party. If the division head's decision is not appealed to Step 11, the grievance shall be considered settled on the basis of the decision made, and shall not be eligible for further appeal -said grievance as believed by them was deemed resolved in their favor.When Mr Abad returned he immediately scheduled a meeting with the grievants. Thereafter, the individual respondents refused to conduct inventory works. Mr. Abad resolved the grievance by denying the petition of individual respondents and adopted the position that inventory of bonded good is part of their duty as catering service personnel and that it was only proper that employees are charged for the amount due to mishandling of company property which resulted to losses. They were also suspended for not conducting inventory work. Held It is clear that the grievance was filed with Mr. Abad's secretary during his absence. Under Section 2 of the CBA aforequoted, the division head shall act on the grievance within five (5) days from the date of presentation thereof, otherwise "the grievance must be resolved in favor of the aggrieved party." It is not disputed that the grievants knew that division head Reynaldo Abad was then "on leave" when they filed their grievance which was received by Abad's secretary.This knowledge, however, should not prevent the application of the CBA. On this score, respondent NLRC aptly ruled: "x x x Based on the facts heretofore narrated, division head Reynaldo Abad had to act on the grievance of complainants within five days from 21 November 1984. Therefore, when Reynaldo Abad failed to act within the reglementary period, complainants, believing in good faith that the effect of the CBA had already set in, cannot be blamed if they did not conduct ramp inventory for the days thereafter xxx it is hard to believe that everything under Abad's authority would have to stand still during his absence from office. To be sure, it is to be expected that someone has to be left to attend to Abad's duties. As respondent NLRC has pointed out, Abad's failure to act on the matter may have been due to petitioner's inadvertance, but it is clearly too much of an injustice if the employees be made to bear the dire effects thereof. Much as the latter were willing to discuss their grievance with their employer, the latter closed the door to this possibility by not assigning someone else to look

PAL V SANTOS 218 SCRA 415 REGALADO; February 1, 1993
Facts Respondents are Port Stewards of Catering Sub-Department, Passenger Services Department of PAL who have the following duties and responsibilities:Prepare meal orders and check-lists, setting up standard equipment in accordance with the requirements of the type of service for each flight; skiing, binning and inventorying of Commissary supplies and equipment. On various occasions, several deductions were made from their salary representing losses of inventoried items charged to them for mishandling of company properties Respondents, represented by the union, made a formal notice regarding the deductions to petitioner thru Mr. Reynaldo Abad, Manager for Catering. PAL did not act on it thus respondents filed a formal grievance

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into "lie matter during Abad's absence. Thus, private respondents should not be faulted for believing that the effect of the C13A in their favor had already stepped into the controversy. Disposition petition denied, assailed decision of NLRC is affirmed

Secretary deemed it best to leave the matter to the agreement of both parties. Finally, the Secretary advised the parties that the list of accredited voluntary arbitrators is now being maintained and disseminated by the National Conciliation and Mediation Board and no longer by the Bureau of Labor Relations. ISSUE WON the Honorable Secretary committed grave abuse of discretion in modifying the grievance machinery HELD NO.

CALTEX REFINERY EMPLOYEES ASSOCIATION (CREA) VS.SEC.. BRILLANTES, and CALTEX (PHILIPPINES 279 SCRA 218 PANGANIBAN; 1997

y No particular setup for a grievance machinery is mandated by law. Rather, Article 260 of the Labor Code, FACTS as incorporated by RA 6715, provides for only a single y Anticipating the expiration of their Collective Bargaining grievance machinery in the company to settle problems Agreement on July 31, 1995, petitioner CALTEX EMPLOYEES arising from "interpretation or implementation of their ASSOC and CALTEX PHIL. negotiated the terms and collective bargaining agreement and those arising from conditions of employment to be contained in a new CBA. The the interpretation or enforcement of company personnel negotiation between the two parties was participated in by the policies." National Conciliation and Mediation Board (NCMB) and the Office of the Secretary of Labor and Employment. Some items in the new CBA were amicably arrived at and agreed upon, but y Article 260, as amended, reads: Grievance Machinery and Voluntary Arbitration. The parties to a Collective others were unresolved. Bargaining Agreement shall include therein provisions that will ensure the mutual observance of its terms and y To settle the unresolved issues, eight meetings between the conditions. They shall establish a machinery for the parties were conducted. Because the parties failed to reach adjustment and resolution of grievances arising from any significant progress in these meetings, petitioner declared the interpretation or implementation of their Collective a deadlock. On July 24, 1995, petitioner filed a notice of strike. Bargaining Agreement and those arising from the Six (6) conciliation meetings conducted by the NCMB failed to interpretation or enforcement of company personnel settle the parties' differences. Then, the parties held marathon policies. meetings at the plant level, but this remedy proved also unavailing. All grievances submitted to the grievance machinery which are not settled within seven (7) calendar days y During a strike vote on August 16, 1995, the members of from the date of its submission shall automatically be petitioner opted for a walkout. Private respondent then filed referred to voluntary arbitration prescribed in the with the Department of Labor and Employment (DOLE) a Collective Bargaining Agreement. For this purpose, petition for assumption of jurisdiction in accordance with Article parties to a Collective Bargaining Agreement shall 263 (g) of the Labor Code. Sec. Brillantes assumed jurisdiction. name and designate in advance a Voluntary Arbitrator He enjoined any strike or lockout, whether actual or intended. or panel of Voluntary Arbitrators, or include in the The parties were further directed to cease and desist from agreement a procedure for the selection of such committing any and all acts which might exacerbate the Voluntary Arbitrator or panel of Voluntary Arbitrators, situation. preferably from the listing of qualified Voluntary Arbitrators duly accredited by the Board. In case the y Several issues on benefits were raised. One of the issues parties fail to select a Voluntary Arbitrator or panel of which stood out however was the grievance procedure of the Voluntary Arbitrators, the Board shall designate the parties under the CBA. The Secretary ordered that the Voluntary Arbitrator or panel of Voluntary Arbitrators, as periods to process/resolve grievances based on existing may be necessary, pursuant to the selection procedure practice be reduced from (45) days to (30) days at the first agreed upon in the Collective Bargaining Agreement, step and (10) days to seven (7) days at the second step which which shall act with same force and effect as if the is the level of the VP for Manufacturing. The Secretary further Arbitrator or panel of Arbitrators has been selected by reviewed the steps through which a grievance may be the parties as described above. processed and in line with the principle to expedite the early resolution of grievances, and found that the establishment of a joint Council as an additional step in the grievance procedure, y We believe that the procedure described by public respondent sufficiently complies with the minimum may only serve to protract the proceeding and, therefore, no requirement of the law. Public respondent even longer necessary. Instead, the unresolved grievance, if, not provided for two steps in hearing grievances prior to settled within (7) days at the level of the VP for Manufacturing, their referral to arbitration. The parties will decide on the shall automatically be referred by both parties to voluntary number of arbitrators who may hear a dispute only arbitration in accordance with R.A. 6715. when the need for it arises. Even the law itself does not specify the number of arbitrators. Their alternatives y As to the number of Arbitrators for which the Union proposes whether to have one or three arbitrators have their to employ only one instead of a panel of three Arbitrators, the respective advantages and disadvantages. In this

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RATIO Contract in labor law is a term the implications of which must be determined from the connection in which it appears. Collective bargaining between employer and the representatives of a unit, usually a union, results in an accord as to terms which will govern hiring and work and pay in that unit. The result is not, however a contract of employment except in rare cases; no one has a job by reason of it and no obligation to any individual ordinarily comes into existence from it alone. The negotiations between union and management result in what often has been 5.3 INDIVIDUAL WORKER AND called a trade agreement, rather than in a contract of employment. CONTRACT After the collective trade agreement is made, the individuals who J.I. CASE CO. VS NATIONAL LABOR RELATIONS shall benefit by it are identified by individual hirings. The BOARD employer, except as restricted by the collective agreement itself 64 Sup. Ct. 576 99 L. Ed. (44) and exceptthat he must engage in no unfair labor practice or discrimination, is free to select those he will employ or discharge. JACKSON; October 1943 But the terms of the employment already have been traded out. But however engaged, an employee becomes entitled by virtue NATURE of the Labor Relations Act somewhat as a third party beneficiary Certiorari to review a decree which granted enforcement of an order of to all benefits of the collective trade agreement, even if on his the National Relations Board own he would yield to less favorable terms. The individual hiring contract is subsidiary to the terms of the trade FACTS - Petitioner J.I. Case Company, from 1937 offered each employee an agreement and may not waive any of its ebenfits, any more individual contract of employment. The contracts were uniform and for a than a shipper can contract away the benefit of filed taiffs. term of one year. The Company agreed to furnish employment as Concurrent existence of these two types of agreement raises steadily as conditions permitted, to pay a specified rate, which the problems as to which the National Labor Relations Act makes no Company might re-determine if the job changed, and to maintain certain express provision. The court however held that individual hospital facilities. The Employee agreed to accept the provisions, to contracts obtained as the result of an unfair labor practice may serve faithfully and honestly for the term, to comply with factory rules not be the basis of advantage to the violator of the Act nor of and that defective work should not be paid for. About 75% of the disadvantage to employees. employees accepted and worked under these agreements. According to Individual contracts, no matter what the circumstances that the Board¶s stipulation and finding, the execution of the contracts was justify their execution or what their terms, may not be availed of not a condition of employment, nor was the status of individual to defeat or delay the procedures prescribed by the National employees affected by reason of signing or failing to sign the contracts. Labor Relations Act looking to collective bargaining, nor to It is not found or contended that the agreements were coerced, obtained exclude the contracting employee from a duly ascertained by any unfair labor practice, or that they were not valid under the bargaining unit; nor may they be used to forestall bargaining or to limit or condition the terms of the collective agreement ³The circumstances in which they were made. - While the individual contracts executed were in effect, a C.I>O> union Board asserts a public right vested in it as a public body, petitioned the Board for certification as the exclusive bargaining charged in the public interest with the duty of preventing unfair representative of the production and maintenance employees. A hearing labor practices´. Whether private contracts conflict with its was held, at which the Company urged the individual contracts as a bar functions, they obviously must yield or the Act would be to representation proceedings, the Board, however, directed an election reduced to a futility which was won by the union. The union was thereupon certified as the It is equally clear since the collective trade agreement is to serve exclusive bargaining representative of the em0ployees in question in the purpose contemplated by the Act, the individual contract cannot be effective as a waiver of any benefit to which the respect to wages, hours and other conditions of employment. -The union then asked the Company to bargain, it refused, declaring that employee otherwise would be entitled under the trade agreement. it could not deal with the union in any manner affecting rights and The very purpose of providing by statute for the collective obligations under the individual contracts while they remained in effect. It agreement is to supersede the terms of separate agreements of offered to negotiate on matters which did not affect rights under the employees with terms which reflect the strength and bargaining individual contracts, and said that upon the expiration of the contracts it power and serve the welfare of the group. Its benefits and advantages are open to every employee of the represented unit, would bargain as to all matters. -The Board held that the Company had refused to bargain collectively in whatever the type or terms of his pre-exisitng contract of violation of S8 of the National Relations Act; and that the contracts had employment. bee utilized by means of the circulars to impede employees in the But it is urged that some employees may lose by the collective exercise of rights guaranteed by s7 of the Act, with the result that the agreement, that an individual workman may sometimes have, or Company had engaged in unfair labor practices within the meaning of s8 be capable of getting better terms than those obtainable by the (1) of the Act. It ordered the Company to cease and desist from giving group and that his freedom of contract must be respected on that effect to the contracts, from extending them or entering into new ones, account. The court finds the mere possibility that such from refusing to bargain and from interfering with the employees; and it agreements might be made no ground for holding generally required the Company to give notice accordingly and to bargain upon that individual contracts may survive or surmount collective request. The Circuit Court of Appeals, with modification not in issue here, ones. The practice and philosophy of collective bargaining looks with suspicion on such individual advantages of granted an order of enforcement. course where there is great variation in circumstances of employment or capacity of employees, it is possible for the ISSUE WON the contentions of the Company that the individual contracts collective bargain to prescribe only minimum rates or precluded a choice of representatives and warranted refusal to bargain masimum hours or expressly to leave certain areas open to individual bargaining. But except as so provided, during their duration were properly overruled. advantages to individuals may prove as disruptive of industrial peace as disadvantages HELD YES DISPOSITION AFFIRMED

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. At bottom, we cannot really impute grave abuse of discretion to public respondent on this issue.

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5.4 CONTRACT INFIRMITY
ASSOCIATED LABOR UNIONS VS CALLEJA 173 SCRA 179 REGALADO; May 5, 1989
NATURE Special civil action for certiorari and prohibition FACTS - Petitioner Associated Labor Unions instituted this action to overturn the decision of the respondent director which ordered the holding of a certification election among the rank-and-file workers of the private respondent GAW Trading, Inc. - ALU thru its regional VP Teofanio C. Nuñez informed GAW Trading, Inc. that majority of the latter's employees have authorized ALU to be their sole and exclusive bargaining representative, and requested GAW Trading Inc., in the same Letter for a conference for the execution of an initial CBA - GAW Trading Inc. responded indicating its recognition of ALU as the sole and exclusive bargaining agent for the majority of its employees and for which it set the time for conference and/or negotiation - ALU in behalf of the majority of the employees of GAW Trading Inc. signed and executed the CBA - In the meantime, at a date before the execution of the CBA, the Southern Philippines Federation of Labor (SPFL) together with Nagkahiusang Mamumuo sa GAW (NAMGAW) undertook a Strike after it failed to get the management of GAW Trading Inc. to sit for a conference respecting its demands presented in an effort to pressure GAW Trading Inc. to make a turnabout of its standing recognition of ALU as the sole and exclusive bargaining representative of its employees, as to which strike GAW Trading Inc. filed a petition for Restraining Order/Preliminary Injunction and which strike Labor Arbiter Bonifacio B. Tumamak held as illegal - GAW Lumad Labor Union (GALLU-PSSLU) Federation filed a Certification Election petition, but as found by Med-Arbiter Candido M. Cumba in its, without having complied with the subscription requirement for which it was merely considered an intervenor until compliance thereof in the other petition for direct recognition as bargaining agent filed by SPFL as found in the same order - In the meantime, the CBA executed by ALU and GAW Trading Inc. was duly filed with the Ministry of Labor and Employment in Region VII, Cebu city - Nevertheless, Med-Arbiter Cumba in his order ruled for the holding of a certification election in all branches of GAW Trading Inc. in Cebu City, as to which ALU filed a Motion for Reconsideration which was treated as an appeal on that questioned Order for which reason the entire record of subject certification case was forwarded for the Director, Bureau of Labor Relations, Ministry of Labor and Employment, Manila - BLR Director Cresencio B. Trajano, rendered a Decision granting ALU's appeal and set aside the questioned Med-Arbiter Order on the ground that the CBA has been effective and valid and the contract bar rule is applicable - The decision of Director Trajano was sought for reconsideration both by SPFL and the Philppine Social Security Labor Union (PSSLU) which were opposed by both GAW Trading, Inc. and ALU - The aforesaid decision was thereafter reversed by respondent director in her aforecited decision which is now assailed in this action. A motion for reconsideration of ALU appears to have been disregarded, hence, its present resort grounded on grave abuse of discretion by public respondent. - Public respondent ordered the holding of a certification election ruling that the "contract bar rule" relied upon by her predecessor does not apply in the present controversy. According to the decision of said respondent, the CBA involved herein is defective because it "was not duly submitted in accordance with Section I, Rule IX, Book V of the Implementing Rules of BP 130." It was further observed that "there is no proof tending to show that the CBA has been posted in at least two conspicuous places in the establishment at least five days before its

ratification and that it has been ratified by the majority of the employees in the bargaining unit." ISSUE WON the CBA executed by GAW Trading Inc and ALU is defective. HELD YES. Ratio The CBA in question is defective hence unproductive of the legal effects attributed to it by the former director in his decision which was subsequently and properly reversed. The mechanics of collective bargaining are set in motion only when the following jurisdictional preconditions are present, namely, (1) possession of the status of majority representation by the employees' representative in accordance with any of the means of selection and/or designation provided for by the Labor Code; (2) proof of majority representation; and (3) a demand to bargain under Article 251, paragraph (a), of the New Labor Code. Reasoning In the present case, the standing of petitioner as an exclusive bargaining representative is dubious, to say the least. Respondent company, in a letter and addressed to petitioner, merely indicated that it was "not against the desire of its workers" and required petitioner to present proof that it was supported by the majority thereof in a meeting to be held on the same date. - The only express recognition of petitioner as said employees' bargaining representative is in the CBA entered into two days thereafter. Evidently, there was precipitate haste on the part of respondent company in recognizing petitioner union, which recognition appears to have been based on the self-serving claim of the latter that it had the support of the majority of the employees in the bargaining unit. - Furthermore, at the time of the supposed recognition, the employer was obviously aware that there were other unions existing in the unit. The unusual promptitude in the recognition of petitioner union by respondent company as the exclusive bargaining representative of the workers in GAW Trading, Inc. under the fluid and amorphous circumstances then obtaining, was decidedly unwarranted and improvident. It bears mention that even in cases where it was the then Minister of Labor himself who directly certified the union as the bargaining representative, this Court voided such certification where there was a failure to properly determine with legal certainty whether the union enjoyed a majority representation. In such a case, the holding of a certification election at a proper time would not necessarily be a mere formality as there was a compelling reason not to directly and unilaterally certify a union. - An additional infirmity of the CBA involved was the failure to post the same in at least 2 conspicuous places in the establishment at least five days before its ratification. In the first place, the posting of copies of the CBA is the responsibility of the employer which can easily comply with the requirement through a mere mechanical act. The purpose of the requirement is precisely to inform the employees in the bargaining unit of the contents of said agreement so that they could intelligently decide whether to accept the same or not. The assembly of the members of ALU wherein the agreement in question was allegedly explained does not cure the defect. The contract is intended for all employees and not only for the members of the purported representative alone. It may even be said the the need to inform the non-members of the terms thereof is more exigent and compelling since, in all likehood, their contact with the persons who are supposed to represent them is limited. - Another potent reason for annulling the disputed collective bargaining is the finding of respondent director that 181 of the 281 workers who "ratified" the same now ³strongly and vehemently deny and/or repudiate the alleged negotiations and ratification of the CBA." - 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 which do not foster industrial stability, such as contracts where the

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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. Disposition WHEREFORE, the order of the public respondent for the conduct of a certification election among the rank-and-file workers of respondent GAW Trading Inc. is AFFIRMED.

5.5 CONTRACT DURATION AND
RENEWALS- 253 A
ART. 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 Sec 21, RA No. 6715)

MERALCO later filed a supplement to the MFR, alleging that the SoL did not properly appreciate the effect of the awarded wages and benefits on MERALCO¶s financial viability. MEWA likewise filed a motion asking the SoL to reconsider its Order on the wage increase, leaves, decentralized filing of paternity and maternity leaves, bonuses, retirement benefits, optional retirement, medical, dental and hospitalization benefits, short swing and payroll treatment. On its political demands, MEWA asked the SoL to rule its proposal to institute a Code of Discipline for its members and the union¶s representation in the administration of the Pension Fund. - On Dec. 28, 1996, the SoL issued an Order resolving the parties¶ separate motions stating, among others, that the effectivity of the agreement was to be RETROACTIVE or from Dec. 1, 1995 to Nov. 30, 1997. - Dissatisfied, MERALCO filed this petition contending that the SoL gravely abused his discretion. ISSUE WON the retroactive effectivity of the new CBA set by the SoL was proper HELD NO. There is no sufficient legal ground on the justification for the retroactive application of the disputed CBA. The CBA should be effective for a term of 2 years counted from Dec.28, 1996 (the date of the SoL¶s disputed order) up to Dec.27, 1999. Reasoning Under Art.253-A, the representation aspect of the CBA is to be for a term of 5 years while all other provisions of the CBA shall be re-negotiated not later than 3 years after its execution. Any agreement on such other provisions of the CBA entered into within 6 months from the date of expiry of the term of such other provisions as fixed in such CBA shall retroact to the day immediately following such date. If such agreement is entered into beyond 6 months, the parties shall agree on the duration of the effectivity thereof. - INTERPRETATION: it is clear that the 5-year term requirement under Art.253-A is specific to the representation aspect. What the law additionally requires is that a CBA must be re-negotiated within 3 years after its execution. If no agreement is reached within 6 months from the expiry date of the 3 years that follow the CBA execution, the law expressly gives the parties - not anybody else - the discretion to fix the effectivity of the agreement. - The law does not specifically cover the situation where no agreement has been reached with respect to the effectivity of the CBA within the 6 month period allowed. In this eventuality, 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 respectively unless there are legal justifications for its retroactive application. Disposition Petition GRANTED. Orders of public respondent SoL dated Aug.19, 1996 and Dec.28, 1996 are SET ASIDE.

MANILA ELECTRIC CO. v QUISUMBING (MEWA) 302 SCRA 173 MARTINEZ; JAN.27, 1999
NATURE Petition for certiorari of the order of the Sec. of Labor (SoL) FACTS - MERALCO¶s rank and file union, MEWA (Meralco Workers Assoc.), informed MERALCO of its intention to re-negotiate the terms and conditions of their existing 1992-1997 CBA covering the remaining 2 years of said CBA starting from Dec. 1, 1995 to Nov. 30, 1997. MERALCO, willing to re-negotiate, formed a CBA negotiating panel for the purpose. After MEWA submitted its proposal, MERALCO presented a counter-proposal. The collective bargaining negotiations eventually proceeded, however, despite the series of meetings between the negotiating panels of MERALCO and MEWA, the parties failed to arrive at terms and conditions acceptable to both. - MEWA filed a notice of strike with the NRC National Conciliation and Mediation Board (NCMB) on the grounds of bargaining deadlock and unfair labor practices. The NCMB conducted a series of conciliation meetings but the parties failed to reach an amicable settlement. MERALCO, faced with the imminence of a strike, filed a petition with the DOLE praying that the SoL assume jurisdiction over the labor dispute and to enjoin the striking employees to go back to work. The SoL granted the petition and enjoined the members of MEWA from committing any act that may exacerbate the situation. - After the parties submitted their respective memoranda, the SoL resolved the labor dispute through an order dated Aug.19, 1996, upon which MERALCO filed a MFR alleging that the SoL committed grave abuse of discretion amounting to lack or excess of jurisdiction.

MANILA CENTRAL LINE CORP. v MANILA CENTRAL LINE FREE WORKERS UNION 290 SCRA 690 MENDOZA; June 15, 1998
NATURE Petition for certiorari

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FACTS - This case arose out of a collective bargaining deadlock between petitioner and Manila Central Line Free Workers Union-National Federation of Labor. The parties' collective bargaining agreement had expired on March 15, 1989. As the parties failed to reach a new agreement, the union sought the aid of the National Conciliation and Mediation Board, but the deadlock remained unresolved. - On February 9, 1990, the union filed a Petition for Compulsory Arbitration. At the initial hearing, the parties declared that conciliation efforts before the NCMB had terminated and it was their desire to submit the case for compulsory arbitration. - On September 28, 1990, the labor arbiter rendered a decision embodying provisions for a new 5-year collective bargaining agreement. - Petitioner¶s appeal was denied by the NLRC. The NLRC also denied petitioner's motion for reconsideration. ISSUE WON the NLRC erred in affirming the Labor Arbiter's decision holding that the effectivity of the renegotiated CBA shall be retroactive to March 15, 1989, the expiry date of the old CBA. HELD YES Reasoning Art. 253-A refers to collective bargaining agreements entered into by the parties as a result of their mutual agreement. The CBA in this case, on the other hand, is part of an arbitral award. As such, it may be made retroactive to the date of expiration of the previous agreement. - St. Luke's Medical Center, Inc. v. Torres: The effectivity of the Order« must retroact to the date of the expiration of the previous CBA, contrary to the position of petitioner. Article 253-A cannot be properly applied to herein case. As correctly stated by public respondent, ³anent the alleged lack of basis for the retroactivity provisions awarded, we would stress that the provision of law invoked by the Hospital, Article 253-A of the Labor Code, speaks of agreements by and between the parties, and not arbitral awards . . .´ Therefore, in the absence of a specific provision of law prohibiting retroactivity of the effectivity of arbitral awards issued by the Secretary of Labor pursuant to Article 263(g) of the Labor Code, such as herein involved, public respondent is deemed vested with plenary and discretionary powers to determine the effectivity thereof. - petitioner has not shown that the question of effectivity was not included in the general agreement of the parties to submit their dispute for arbitration. To the contrary, as the order of the labor arbiter states, this question was among those submitted for arbitration by the parties: As regards the "Effectivity and Duration" clause, the company proposes that the collective bargaining agreement shall take effect only upon its signing and shall remain in full force and effect for a period of five years. The union proposes that the agreement shall take effect retroactive to March 15, 1989, the expiration date of the old CBA. - It is the observation of this Arbitrator that in almost subsequent CBAs, the effectivity of the renegotiated CBA, usually and most often is made effective retroactive to the date when the immediately proceeding CBA expires so as to give a semblance of continuity. Disposition the petition is DISMISSED for lack of merit.

- President Estrada issued AO No. 16 creating an Inter-Agency Task Force (Task Force) to address the problems PAL. Edgardo Espiritu, then the Sec of Finance, was designated chairman of the Task Force. - PAL management submitted to the Task Force an offer by private respondent Lucio Tan, Chairman and Chief Executive Officer of PAL, of a plan to transfer shares of stock to its employees. PALEA rejected offer. - PAL eventually ceased its operations and sent notices of termination to its employees. - PALEA board wrote the President for intervention proposing terms and conditions including the suspension of the PALPALEA CBA for a period of 10 years. - PALEA members cast their votes in a DOLE-supervised referendum. 61% ratified the PAL-PALEA agreement. - Days later, seven officers and members of PALEA filed petition to annul the agreement entered into between PAL and PALEA. -Petitioners: the PAL-PALEA agreement is void because it abrogated the right of workers to self-organization and their right to collective bargaining« and that the agreement was not meant merely to suspend the existing PAL-PALEA CBA, but also to foreclose any renegotiation or any possibility to forge a new CBA for a decade. It violates the ³protection to labor´ policy laid down by the Constitution. ISSUE/S 1. WON an original action for certiorari and prohibition the proper remedy to annul the PAL-PALEA agreement 2. WON the PAL-PALEA agreement of Sept 27, 1998, stipulating the suspension of the PAL-PALEA CBA is unconstitutional and contrary to public policy HELD 1. NO (Petitioners alleged grave abuse of discretion under Rule 65 of the 1997 Rules of Civil Pro) The essential requisites for a petition for certiorari under Rule 65 are: (1) the writ is directed against a tribunal, a board, or an officer exercising judicial or quasi-judicial functions; (2) such tribunal, board, or officer has acted without or in excess of jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction; and (3) there is no appeal or any plain, speedy, and adequate remedy in the ordinary course of law - The assailed agreement is clearly not the act of a tribunal, board, officer, or person exercising judicial, quasi-judicial, or ministerial functions. It is not the act of public respondents Finance Secretary Espiritu and Labor Secretary Laguesma as functionaries of the Task Force. Neither is there a judgment, order, or resolution of either public respondents involved. Instead, what exists is a contract between a private firm and one of its labor unions, albeit entered into with the assistance of the Task Force. The first and second requisites for certiorari and prohibition are therefore not present in this case. ( Nevertheless, Court looked into the substance of the petition, in the higher interest of justice and in view of the public interest involved) 2. NO 6 -Article 253-A has a two-fold purpose. One is to promote industrial stability and predictability. Inasmuch as the agreement

RIVERA V ESPIRITU, PAL, LUCIO TAN, et al 97 SCRA 715 QUISUMBING; JAN 23, 2002
NATURE Special civil action for certiorari and prohibition FACTS -PAL pilots went on a strike. As a result, PAL¶s financial situation went from bad to worse. Faced with bankruptcy, PAL downsized its labor force by more than one-third. - PALEA went on strike to protest the retrenchment measures adopted by the airline, w/c affected 1,899 union members.

6

ART. 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 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 3 years after its execution. Any agreement on such other provisions of the Collective Bargaining Agreement entered into within 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 the

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CBA AND 3RD PARTY APPLICABILITY

sought to promote industrial peace at PAL during its rehabilitation, said agreement satisfies the first purpose of Article 253-A. The other is to assign specific timetables wherein negotiations become a matter of right and requirement. Nothing in Article 253-A, prohibits the parties from waiving or suspending the mandatory timetables and agreeing on the remedies to enforce the same. -The acts of public respondents in sanctioning the 10-year suspension of the PAL-PALEA CBA did not contravene the ³protection to labor´ policy of the Constitution. The agreement afforded full protection to labor; promoted the shared responsibility between workers and employers; and the exercised voluntary modes in settling disputes, including conciliation to foster industrial peace - It was also PALEA that voluntarily opted for the 10-year suspension of the CBA. Either case was the union¶s exercise of its right to collective bargaining. The right to free collective bargaining, after all, includes the right to suspend it. - Petitioners further allege that the 10-year suspension of the CBA under the PAL-PALEA agreement virtually installed PALEA as a company union for said period, amounting to unfair labor practice, in violation of Article 253-A of the Labor Code mandating that an exclusive bargaining agent serves for five years only. The questioned proviso of the agreement reads:
a. PAL shall continue recognizing PALEA as the duly certified-bargaining agent of the regular rank-and-file ground employees of the Company;

SUNDOWNER DEVELOPMENT CORP V DRILON 180 SCRA 14 GANCAYCO; December 6, 1989
NATURE Petition for certiorari to review the orders of the Secretary of the Department of Labor and Employment FACTS - Hotel Mabuhay, Inc. leased the premises belonging to Santiago Syjuco, Inc. in Ermita, Manila. - Due to non-payment of rentals, a case for ejectment was filed by Syjuco against Mabuhay in the Metropolitan Trial Court of Manila. Mabuhay offered to amicably settle the cam by surrendering the premises to Syjuco and to sell its assets and personal property to any interested party. - Syjuco offered the said premises for lease to Sundowner. - April 16, 1987 ± The lease agreement was finalized and was agreed to commence on May 1, 1987 and to expire on April 30, 1992. - May 4, 1987 - National Union of Workers in Hotel, Restaurant and Allied Services (NUWHRAIN for short) picketed the leased premises, barricaded the entrance to the leased premises and denied petitioner's officers, employees and guests free access to and egress from said premises. This prompted Sundowner to write a letter of complaint to Syjuco. - May 7, 1987 - A complaint for damages with preliminary injunction and/or temporary restraining order was filed by Sundowner. The Executive Judge of the court issued a restraining order against respondent NUWHRAIN and its officers and members. NUWHRAIN nevertheless maintained their strike but filed an answer to the complaint. - May 14, 1987 - An order was issued by public respondent Secretary of Labor assuming jurisdiction over the labor dispute pursuant to Article 263(g) of the Labor Code. It required the 91 striking employees to return to work and for Mabuhay to accept all returning employees pending final determination of the issue of the absorption of the former employees of Mabuhay. - Mabuhay submitted its position paper alleging: - That it had sold all its assets and personal properties to Sundowner and that there was no sale or transfer of its shares whatsoever. - Mabuhay completely ceased operation effective April 28,1987 and surrendered the premises to Sundowner so that there exists a legal and physical impossibility on its part to comply with the return to work order specifically on absorption. - June 26, 1987 - In order to commence its operation, Sundowner signed a tripartite agreement so the workers may lift their strike. In this agreement among Sundowner, NUWHRAIN and Mabuhay, the latter paid to respondent NUWHRAIN the sum of P638,000.00 in addition to the first payment in the sum of P386,447.11, for which reason respondent NUWHRAIN agreed to lift the picket. - July 13, 1987 - NUWHRAIN filed its position paper alleging connivance between Mabuhay and Sundowner in selling the assets and closing the hotel to escape its obligations to the employees of Mabuhay. NUWHRAIN prays that petitioner accept the workforce of Mabuhay and pay backwages from April 16, 1986 to April 28, 1987, the day Mabuhay stopped operation. - January 20, 1988 ± Drilon, as DOLE secretary, issued an order requiring Sundowner to absorb the members of the union and to pay backwages from the time it started operations up to the date of the order. - January 27, 1988 ± Sundowner filed a motion for reconsideration of the order, alleging that the theory of implied acceptance and assumption of statutory wrong does not apply in

Said proviso cannot be construed alone. The aforesaid provision must be read within the context of the next clause:
b. The µunion shop/maintenance of membership¶ provision under the PAL-PALEA CBA shall be respected.

The aforesaid provisions, taken together, clearly show the intent of the parties to maintain ³union security´ during the period of the suspension of the CBA. Its objective is to assure the continued existence of PALEA during the said period. We are unable to declare the objective of union security an unfair labor practice. It is State policy to promote unionism to enable workers to negotiate with management on an even playing field and with more persuasiveness than if they were to individually and separately bargain with the employer. Petitioners¶ contention that the agreement installs PALEA as a virtual company union is also untenable. Under Article 248 (d) of the Labor Code, a company union exists when the employer acts ³[t]o 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.´ The case records are bare of any showing of such acts by PAL. We also do not agree that the agreement violates the five-year representation limit mandated by Article 253-A. Under said article, the representation limit for the exclusive bargaining agent applies only when there is an extant CBA in full force and effect. In the instant case, the parties agreed to suspend the CBA and put in abeyance the limit on the representation period.

Disposition CA decision affirmed but modified (SC deleted decision that mortgage fee as fully paid, and awarded moral damages).

retroactivity thereof. In case of a deadlock in the renegotiation of the collective bargaining agreement, the parties may exercise their rights under this Code.

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the instant case and that there is no law requiring bona fide purchasers of the assets of an on-going concern to absorb in its employ the employees of the latter. - Drilon denied the MFR. ISSUE WON the purchaser of the assets of an employer corporation can be considered a successor employer of the latter's employees HELD NO Ratio 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. Reasoning - 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. - However, 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. - In the case at bar, contrary to the claim of the public respondent that the transaction between petitioner and Mabuhay was attended with bad faith, the court finds no cogent basis for such contention. Thus, the absorption of the employees of Mabuhay may not be imposed on petitioner. - It is undisputed that when Mabuhay surrendered the leased premises to Syjuco and asked Syjuco to offer same to other lessees, it was Syjuco who found petitioner and persuaded petitioner to lease said premises. Mabuhay had nothing to do with the negotiation and consummation of the lease contract between petitioner and Syjuco. - In the tri-partite agreement that was entered into by petitioner with respondents NUWHRAIN and Mabuhay, it is clearly stipulated that immediately after the execution of the agreement, Mabuhay shall give a list of its members to Sundowner that it desires to recommend for employment so that the latter can consider them for employment, with no commitment whatsoever on the part of Sundowner to hire them in the business that it will operate in the premises formerly occupied by the Hotel Mabuhay. - There can be no implied acceptance of the employees of Mabuhay by petitioner and acceptance of statutory wrong as it is expressly provided in the agreement that petitioner has no commitment or duty to absorb them. - The court does not subscribe to the theory of Drilon that petitioner should have informed NUWHRAIN of its lease of the premises and its purchase of the assets and personal properties of Mabuhay so that said employees could have taken steps to protect their interest. The court finds no such duty on the part of petitioner and its failure to notify said employees cannot be an indicium of bad faith. - While it is true that petitioner is using the leased property for the same type of business as that of respondent Mabuhay, there can be no continuity of the business operations of the predecessor employer by the successor employer as respondent Mabuhay had not retained control of the business. Disposition Petition granted. Orders reversed and set aside.

- Each of them then executed a Release and Waiver which they acknowledged before the Hearing Officer of the Butuan City District Office of the DOLE - The new owner caused the publication of a notice for the hiring of workers, indicating therein who of the separated employees could be accepted on probationary basis. The petitioners then filed their applications for employment. Except for Rosario Cuarto, they were hired on probationary basis for six months as patchers or tapers, but were compensated on piece-rate or task basis. - For their alleged absence without leave, Perla Cumpay and Virginia Etic were considered, to have abandoned their work. The rest were dismissed because they allegedly committed acts prejudicial to the interest of the new management. - Petitioners then filed against the respondent a complaint. - The petitioners maintained that they remained regular employees regardless of the change of management and their execution of the Release and Waiver. - Respondent contended that the petitioners were deemed legally terminated from their previous employment; that the new owner was well within its legal right or prerogative in considering as terminated the petitioners' probationary/temporary appointment; and that the petitioners were not illegally dismissed; hence, they are not entitled to the reliefs prayed for. - Labor Arbiter ruled for the petitioners. The Labor Arbiter, however, ruled that there was no "cessation of operations which would lead to the dismissal of the employees." - Respondent appealed to the NLRC which reversed the judgment of the Labor Arbiter, subject, however, to recomputation based on the actual services of the petitioners under the new owner up to the actual date of their separation from the service. It found that the change of ownership in this case was made in good faith since there was no evidence on record that "the former owners conspired with the new owners to insulate the former management of any liability to its workers." - Their motion to reconsider the resolution having been denied by the NLRC, the petitioners filed a special civil action for certiorari. ISSUE WON the NLRC acted with grave abuse of discretion when it reversed the decision of the Labor Arbiter. HELD NO. - There was only a change of ownership of Super Mahogany Plywood Corporation which resulted in a change of ownership. In short, the corporation itself, as a distinct and separate juridical entity, continues to exist. The issue of whether there was a closing or cessation of business operations which could have operated as just cause for the termination of employment was not material. - The change in ownership of the management was done bona fide and the petitioners did not for any moment before the filing of their complaints raise any doubt on the motive for the change. On the contrary, upon being informed thereof and of their eventual termination from employment, they freely and voluntarily accepted their separation pay and other benefits and individually executed the Release or Waiver which they acknowledged before no less than a hearing officer of the DOLE. - A change of ownership in a business concern is not proscribed by law. - Central Azaucarera del Danao vs. CA: It is a principle wellrecognized, that it is within the employer's legitimate sphere of management control of the business to adopt economic policies or make some changes or adjustments in their organization or operations that would insure profit to itself or protect the investment of its stockholders. As in the exercise of such management prerogative, the employer may merge or consolidate its business with another, or sell or dispose all or substantially all of its assets and properties which may bring about the dismissal or termination of its employees in the

MANLIMOS V NLRC (SUPER MAHOGANY PLYWOOD CORPORATION/ALBERT GO) 242 SCRA 145 DAVIDE; March 21, 1995
FACTS - The petitioners were among the regular employees of the Super Mahogany Plywood Corporation - A new owner/management group acquired complete ownership of the corporation. The petitioners were advised of such change of ownership; however, the petitioners continued to work for the new owner and were considered terminated, with their conformity, only when they received their separation pay, 13th month pay, and all other benefits due them.

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process. Such dismissal or termination should not however be interpreted in such a manner as to permit the employer to escape payment of termination pay. For such a situation is not envisioned in the law. It strikes at the very concept of social justice. - In a number of cases on this point, the rule has been laid down that the sale or disposition must be motivated by good faith as an element of exemption from liability. - Indeed, an innocent transferee of a business establishment has no liability to the employees of the transferor to continue employing them. Nor is the transferee liable for past unfair labor practices of the previous owner, except, when the liability therefor is assumed by the new employer under the contract of sale, or when liability arises because of the new owner's participation in thwarting or defeating the rights of the employees. - Where such transfer of ownership is in good faith, the transferee is under no legal duty to absorb the transferor's employees as there is no law compelling such absorption. The most that the transferee may do, for reasons of public policy and social justice, is to give preference to the qualified separated employees in the filling of vacancies in the facilities of the purchaser. - Since the petitioners were effectively separated from work due to a bona fide change of ownership and they were accordingly paid their separation pay, which they freely and voluntarily accepted, the private respondent corporation was under no obligation to employ them; it may, however, give them preference in the hiring. The private respondent in fact hired, but on probationary basis, all the petitioners, except Rosario Cuarto. The non-hiring of Cuarto was legally permissible. Disposition Petition waspartly GRANTED. The challenged resolutions of NLRC were MODIFIED; respondent was ordered to pay petitioners Perla Cumpay and Virginia Etic their backwages up to the expiration of their probationary employment contracts.

-By virtue of said refusal, petitioners filed a petition before the BLR against respondents Elizalde Steel Consolidated, Inc. and the National Federation of Labor Unions praying that the mother union be ordered to stop from presenting itself as the collective bargaining agent and pursuant thereto, a writ of preliminary mandatory and prohibitory injunction be issued. -BLR issued an Order dismissing the petition for lack of merit. On appeal, the BLR Director affirmed said dismissal. Hence this petition. ISSUE Which of the two unions should be recognized as the sole and exclusive bargaining representative of the employees and ultimately recognized to administer and supervise the enforcement of the collective bargaining agreement? HELD The union consisting of the members-employees of an employer is the principal party to the collective bargaining agreement (rather than the mother union which is merely its agent) and is therefore entitled to be recognized as the sole and exclusive bargaining representative entitled to administer and enforce the collective bargaining agreement with the employer. -Respondent BLR director correctly perceived in his Resolution that "to grant to the former mother union (NAFLU) the authority to administer and enforce their collective bargaining agreement without presumably any members in the bargaining unit is quite absurd" but fell unto the grave error of holding that "When the employees disaffiliated from the mother union and formed themselves into a new union, their status as employees was also terminated." -The employees and members of the local union did not form a new union but merely registered the local union as was their right. Petitioner Elisco-Elirol Labor Union-NAFLU, consisting of employees and members of the local union was the principal party to the agreement. NAFLU as the "mother union" in participation in the execution of the bargaining agreement with respondent company acted merely as agent of the local union, which remained the basic unit of the association existing principally and freely to serve the common interest of all its members, including the freedom to disaffiliate when the circumstances so warranted as in the present case. (Liberty Cotton Mills Workers Union v. Liberty Cotton Mills) -The "substitutionary" doctrine likewise fully supports petitioner's stand. Petitioner union to whom the employees owe their allegiance has from the beginning expressly avowed that it "does not intend to change and/or amend the provisions of the present collective bargaining agreement but only to be given the chance to enforce the same since there is a shift of allegiance in the majority of the employees at respondent company." -Benguet Consolidated Inc. vs. BCI Employees & Workers Union-PAFLU: This principle, formulated by the NLRB as its initial compromise solution to the problem facing it when there occurs a shift in employees' union allegiance after the execution of a bargaining contract with their employer, merely states that even during the effectivity of a collective bargaining agreement executed between employer and employees thru their agent, the employees can change said agent but the contract continues to bind then up to its expiration date. They may bargain however for the shortening of said expiration date. -In formulating the "substitutionary" doctrine, the only consideration involved as the employees' interest in the existing bargaining agreement. The agent's interest never entered the picture. The justification for said doctrine was that 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. -What is paramount, as it is expressly and explicitly emphasize in an exacting language under the New Constitution, is the security

5.7

CBA AND DISAFFILIATIONSUBSTTTUTION DOCTRINE

ELISCO-ELIROL LABOR UNION V NORIEL 80 SCRA 682 TEEHANKEE; December 29, 1977
FACTS -Sometime on Feb1974, Elisco Elirol Labor Union (NAFLU) negotiated and executed a CBA with Elizalde Steel Consolidated, Inc. Upon verification at the Registration Division, Bureau of Labor Relations, the Elisco-Elirol Labor Union (NAFLU), the contracting party in said CBA, was found to be not then registered and therefore not entitled to the benefits and privileges embodied in said CBA; thus, the members said union in a general membership meeting decided in a resolution to register their union to protect and preserve the integrity and inviolability of the collective bargaining agreement between the Elisco-Elirol Labor Union (NAFLU) and the Elizalde Steel Consolidated, Inc. -Petitioner union applied for registration with the BLR, hence on May 28, 1975, Certificate of Registration No. 8511-IP was issued by said Office. Steps were taken by petitioner to enforce the CBA as the principal party to the same representing the workers covered by such agreement immediately after the issuance of the certificate of registration. -June 10, 1975: at a special meeting called for the purpose, the general membership of the petitioner union adopted a resolution to disaffiliate from their mother union, the National Federation of Labor Unions. The petitioner union informed respondents of said disaffiliation by means of a letter, and subsequently requested respondents to recognize petitioner as the sole and exclusive bargaining representative of the employees thereof but its employer without any justifiable reason refused and continues to refuse to recognize petitioner as the sole and exclusive bargaining representative of its employees, and, now actually dismissed the petitioner union's officers and board members. In this connection, a complaint for unfair labor practice was filed by petitioners against respondents for the latter's refusal to bargain collectively with petitioner.

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of tenure of the workers, not the security of the union. To impress, therefore, such "maintenance of membership" which is intended for the security of the union rather than the security of tenure of the workers as a bar to employees' changing their affiliation is not only to infringe on the constitutional right of freedom of association, but also to trample upon the constitutional right of workers to security of tenure and to render meaningless whatever "adequate social services" the State may establish or maintain in the field of employment "to guarantee the enjoyment by the people of a decent standard of living." Disposition Petition is granted and the appealed resolution is set aside. Petitioner local union is declared to be the sole and exclusive bargaining representative of the employees of respondent corporation entitled to administer and enforce any subsisting collective bargaining agreement with said employer corporation. Decision immediately executory

were under the impression that they were ably represented, they were not able to appeal their case on time. - The Supreme Court has allowed appeals from decisions of the labor arbiter to the NLRC, even if filed beyond the reglementary period, in the interest of justice. 2. NO Ratio When a collective bargaining contract is entered into by the union representing the employees and the employer, even the non-member employees are entitled to the benefits of the contract. Reasoning - It must first be established whether a CBA was in effect during the time of the appeal. A CBA, as to its economic provisions, can be extended beyond the period stipulated therein, and even beyond the three-year period prescribed by law, in the absence of a new agreement, Article 253 of the Labor Code explicitly provides: ART. 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. - 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. In the case at bar, no new agreement was entered into by and between petitioner Pacific and NFL pending appeal of the decision in NLRC Case. - To rule otherwise, i.e., that the economic provisions of the existing CBA in the instant case ceased to have force and effect in the year 1984, would be to create a gap during which no agreement would govern, from the time the old contract expired to the time a new agreement shall have been entered into. - It is even conceded, that a laborer can claim benefits from a CBA entered into between the company and the union of which he is a member at the time of the conclusion of the agreement, after he has resigned from said union. - To exclude the ³nonmembers´ would constitute undue discrimination and deprive them of monetary benefits they would otherwise be entitled to under a new collective bargaining contract to which they would have been parties. Since in this particular case, no new agreement had been entered into after the CBA's stipulated term, it is only fair and just that the employees hired thereafter be included in the existing CBA. DISPOSITION Petition for certiorari is dismissed for lack of merit.

5.8

EFFECT EXPIRY

NEW PACIFIC TIMBER AND SUPPLY CO. INV. V NLRC (BUAT ET AL.) 328 SCRA 173 KAPUNAN; March 17, 2000
NATURE Petition for certiorari. FACTS - The National Federation of Labor (NFL, for brevity) was certified as the sole and exclusive bargaining representative of all the regular rank-andfile employees of petitioner New Pacific Timber & Supply Co., Inc (Pacific). NFL negotiated for better terms and conditions, but Pacific resisted, prompting NFL to sue for unfair labor practice. - March 31, 1987: the Labor Arbiter issued an order declaring (a) herein petitioner Company guilty of ULP. - Pacific appealed to the NLRC, but the NLRC dismissed the petition. The Supreme Court also dismissed the petition filed by Pacific. - The records of the case were remanded to the arbitration branch of origin for the execution of the Labor Arbiter¶s Order, dated March 31, 1987, granting monetary benefits consisting of wage increases, housing allowances, bonuses, etc. to the regular rank-and-file employees. Following a series of conferences to thresh out the details of computation, (new) Labor Arbiter Villena issued an Order, dated October 18, 1993, directing petitioner Company to pay the 142 employees entitled to the aforesaid benefits the respective amounts due them under the CBA. Petitioner Company complied; and, the corresponding quitclaims were executed. The case was considered closed following NFL's manifestation that it will no longer appeal the October 18, 1993 Order of Labor Arbiter Villena. - A petition for relief was filed in behalf of the 186 of the private respondents "Mariano J. Akilit and 350 others." They claimed they were wrongfully excluded from enjoying the benefits of the CBA, and that NFL¶s misrepresentations had precluded them from appealing their exclusion. NLRC held that they were entitled to the CBA. ISSUES 1. WON the petition for relief must prosper. 2. WON Mariano Akilit and the 350 others are entitled to the benefits of the CBA even if they were not employed by Pacific during the CBA term. HELD 1. NO Ratio Once a judgment has become final and executory, it can no longer be disturbed, altered or modified. However, a careful scrutiny of the facts and circumstances of the instant case warrants liberality in the application of technical rules and procedure. Reasoning Private respondents, in their petition for relief, claimed that they were wrongfully excluded from the list of those entitled to the CBA benefits by their union, NFL, without their knowledge; and, because they

MANILA ELECTRIC CO. v QUISUMBING (MEWA) 302 SCRA 173 MARTINEZ; JAN.27, 1999
NATURE Petition for certiorari of the order of the Sec. of Labor (SoL) FACTS - MERALCO¶s rank and file union, MEWA (Meralco Workers Assoc.), informed MERALCO of its intention to re-negotiate the terms and conditions of their existing 1992-1997 CBA covering the remaining 2 years of said CBA starting from Dec. 1, 1995 to

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Nov. 30, 1997. MERALCO, willing to re-negotiate, formed a CBA negotiating panel for the purpose. After MEWA submitted its proposal, MERALCO presented a counter-proposal. The collective bargaining negotiations eventually proceeded, however, despite the series of meetings between the negotiating panels of MERALCO and MEWA, the parties failed to arrive at terms and conditions acceptable to both. - MEWA filed a notice of strike with the NRC National Conciliation and Mediation Board (NCMB) on the grounds of bargaining deadlock and unfair labor practices. The NCMB conducted a series of conciliation meetings but the parties failed to reach an amicable settlement. MERALCO, faced with the imminence of a strike, filed a petition with the DOLE praying that the SoL assume jurisdiction over the labor dispute and to enjoin the striking employees to go back to work. The SoL granted the petition and enjoined the members of MEWA from committing any act that may exacerbate the situation. - After the parties submitted their respective memoranda, the SoL resolved the labor dispute through an order dated Aug.19, 1996, upon which MERALCO filed a MFR alleging that the SoL committed grave abuse of discretion amounting to lack or excess of jurisdiction. MERALCO later filed a supplement to the MFR, alleging that the SoL did not properly appreciate the effect of the awarded wages and benefits on MERALCO¶s financial viability. MEWA likewise filed a motion asking the SoL to reconsider its Order on the wage increase, leaves, decentralized filing of paternity and maternity leaves, bonuses, retirement benefits, optional retirement, medical, dental and hospitalization benefits, short swing and payroll treatment. On its political demands, MEWA asked the SoL to rule its proposal to institute a Code of Discipline for its members and the union¶s representation in the administration of the Pension Fund. - On Dec. 28, 1996, the SoL issued an Order resolving the parties¶ separate motions stating, among others, that the effectivity of the agreement was to be RETROACTIVE or from Dec. 1, 1995 to Nov. 30, 1997. - Dissatisfied, MERALCO filed this petition contending that the SoL gravely abused his discretion. ISSUE WON the retroactive effectivity of the new CBA set by the SoL was proper HELD NO. There is no sufficient legal ground on the justification for the retroactive application of the disputed CBA. The CBA should be effective for a term of 2 years counted from Dec.28, 1996 (the date of the SoL¶s disputed order) up to Dec.27, 1999. Reasoning Under Art.253-A, the representation aspect of the CBA is to be for a term of 5 years while all other provisions of the CBA shall be renegotiated not later than 3 years after its execution. Any agreement on such other provisions of the CBA entered into within 6 months from the date of expiry of the term of such other provisions as fixed in such CBA shall retroact to the day immediately following such date. If such agreement is entered into beyond 6 months, the parties shall agree on the duration of the effectivity thereof. - INTERPRETATION: it is clear that the 5-year term requirement under Art.253-A is specific to the representation aspect. What the law additionally requires is that a CBA must be re-negotiated within 3 years after its execution. If no agreement is reached within 6 months from the expiry date of the 3 years that follow the CBA execution, the law expressly gives the parties - not anybody else - the discretion to fix the effectivity of the agreement. - The law does not specifically cover the situation where no agreement has been reached with respect to the effectivity of the CBA within the 6 month period allowed. In this eventuality, 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 respectively unless there are legal justifications for its retroactive application. Disposition Petition GRANTED. Orders of public respondent SoL dated Aug.19, 1996 and Dec.28, 1996 are SET ASIDE.

CITIZENS LABOR UNION-CCLU V CIR (MALAYANG MANGGAGAWA SA ESSO, DEPT OF LABOR, ESSO) G.R. No. L-24320, L-24421 CASTRO, J.; November 12, 1966
NATURE Consolidated actions for mandamus, prohibition and certiorari to compel respondent court to act on petitioner's MFR FACTS - Respondent union MME filed a petition for certification election with the CIR alleging that it is a labor union organized among the employees of Esso Standard Eastern, Inc.; that it represents the majority of the non-supervisory employees of the said terminal unit; that there exists a CBA between petitioner CLU and ESSO; and that its aim in asking for a certification election is merely to determine which union will administer the contract during the remainder of the term thereof. The CLU and ESSO filed motions to dismiss the petition based on several grounds, most important of which is that the existing CBA is a bar to the holding of a certification election. - After due hearing, the CIR denied the motions, holding that the existing CBA is no bar to a certification election, and requesting the Dept of Labor to conduct the necessary election. The CLU and the ESSO filed with the CIR en banc separate MFRs, to which the MME filed its opposition. Meanwhile, the Dept of Labor scheduled the secret ballot election with notice to the parties concerned. The CLU and the ESSO filed with the CIR en banc separate motions to suspend the certification election as set, upon the basis of their respective MFRs then pending, ESSO on its part alleging that the certification election if held would render st its MFR academic. The CLU filed with this Court the 1 petition for certiorari and mandamus with preliminary injunction. This was given due course and the parties respondents filed their respective answers, but no writ of preliminary injunction was issued. The Dept of Labor proceeded with the election and the result thereof shows that the MME obtained votes of more than one-half of the rank and file employees and laborers of the ESSO unit eligible to vote. - The CLU filed with the CIR a motion to annul the certification election on several grounds, among which are that the election was held illegally and irregularly as it was conducted on a holiday, and that it was had without participation of the CLU therein. The ESSO also filed with the CIR a similar motion to annul the certification election. The MME thereafter filed its opposition thereto. The CIR en banc, by resolution, denied the MFRs. The CLU filed a notice of appeal. The CIR issued an order denying the MFR seeking annulment of the certification election. On the basis of the result of the secret ballot election, the CIR certified the MME as the sole and exclusive bargaining agent of all the non-supervisory employees of the ESSO at its Pandacan Terminal unit. The CLU and the ESSO filed separate motions to have this last order reconsidered. These motions are pending resolution. - The CLU filed with this Court an urgent petition praying for issuance of a writ of preliminary injunction to restrain the CIR from proceeding with the enforcement of its order on the ground st that the issues to be heard in its 1 petition before this Court would become moot and academic if the said order was enforced. The CLU moved to have the hearing advanced. This Court issued the injunction prayed for, restraining the CIR from enforcing its order and also from proceeding or taking any other action in connection with the certification election case. This

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A2010 - 194nd

Disini

Court also advanced the hearing. The CLU filed with this Court a 2 petition for review of the order and resolution of the CIR en banc. We nd gave due course to the 2 petition for review and resolved further to st consider it together with the 1 . - Pending this Court's adjudication of the two cases, the MME filed with this Court a "Motion for Preliminary Injunction", alleging that the ESSO and the CLU had extended the term of the existing CBA; that pursuant to its provisions, the CLU and the ESSO will commence negotiations for a new CBA and sign the same, unless a preliminary injunction is issued by this Court; that a new agreement will render moot and academic the order of the CIR certifying the MME as the sole and exclusive bargaining agent of all the employees of the ESSO unit, and may again be alleged as a bar to the holding of a new certification election. The motion was opposed by the CLU and the ESSO, both alleging that since the secret ballot election was held, there has occurred a substantial change in the composition of the rank and file employees at the ESSO unit, a good number of them having left their employment, retired, or been compulsorily laid off with the approval of the CIR, resulting in a change of employee composition in the unit; that the ESSO will negotiate a new CBA with the union that commands the majority of the present labor force, either the CLU or the MME, as the case may be; and that if this Court issues the restraining order, it will suspend the process of a new CBA to the prejudice of the workers who would be denied the economic benefits thereof. This court issued an injunction commanding the CLU and ESSO to refrain from negotiating and concluding a new collective bargaining agreement until after this Court shall have decided the case on the merits. ISSUE/S 1. WON the court may determine which of the competing unions is the appropriate bargaining unit HELD 1. NO Ratio This Court in numerous cases has reaffirmed its attitude that it is a sound and unassailable labor practice for labor and management to conclude a new contract before the expiry date of any collective bargaining agreement in order to avoid a hiatus in management-labor relations. Reasoning The passage of time has removed all meaning and validity from the positions taken by the 2 competing unions. All the pleadings extant in the record are dated and were filed prior to the date when the CBA in question expired; the positions of the 2 unions have therefore become academic. The CLU claims that it is the sole and exclusive bargaining agent on the strength of its prior collective bargaining history; the MME claims that it is the one that should be recognized on the basis of the will of the employees manifested in the secret ballot election in favor of the MME. Like the CLU, the MME claims that its majority status should be presumed to continue up to the present time and for as long as the question has not been finally resolved. Against the presumption of continued majority status, however, is the rule that such majority status does not continue forever "especially in face of an assertion and offer of proof to the contrary", or "in view of altered circumstances which have likely occurred in the interim", or "by a change in the conditions which demonstrates that a shift in sentiment actually exists among the employees, and is caused by other factors than the employer's refusal to bargain collectively". The burden of coming forward with proof of majority status is upon the union asserting it. Against the claim of the MME that it represents the will of the majority of the rank and file employees at the Pandacan Terminal unit, is the manifestation, advanced with vehemence, of both the CLU and the ESSO that after the secret ballot election, the employee composition has substantially changed because a great number of the employees and laborers in the Pandacan Terminal unit have left their employment, retired, or been compulsorily laid off with the approval of the CIR. Precisely because the record is barren of evidence upon which this Court may properly reach a definitive determination as to which of the 2 unions should be upheld, at this time, as the sole and exclusive bargaining agent, this Court will not even begin to attempt to resolve the problem in favor of one or the other labor union. Disposition Case remanded to the CIR with instructions to take such action and issue such orders as circumstances may warrant.

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