Case No 1

G.R. No. 77231 May 31, 1989

SAN JOSE CITY ELECTRIC SERVICE COOPERATIVE, INC. (SAJELCO), petitioner,
vs.
MINISTRY OF LAOR AN! EMPLOYMENT a"# MAG$AISA%A!LO, respondents.
ME!IAL!EA, J.:
This is a petition for certiorari under Rule 65 of the Rules of Court. Petitioner San Jose City Electric
Service Cooperative, Inc. (SJE!C", for #revity$ see%s the reversal of the "rder (pp. &'()*, Rollo$
of Pura +errer(Calle,a, -irector of .ureau of !a#or Relations in .!R Case /o. (0*(152('6 3hich
affir4ed the "rder of 5ed(r#iter ntonio R. Corte6 to conduct a certification election a4on7 the
ran%(and(file e4ployees of SJE!C".
The antecedent facts of the instant case are as follo3s8
"n July 12, 02'6, private respondent 5an77a7a3an7 /a7%a%aisa n7 SJE!C"(ssociation of
-e4ocratic !a#or "r7ani6ation (59:IS(-!"$ filed a petition (pp. 06(0', Rollo$ for direct
certification election 3ith the Re7ional "ffice /o. 000 of the -epart4ent of !a#or and E4ploy4ent in
San +ernando, Pa4pan7a. The petition alle7ed that 59:IS(-!" is a le7iti4ate la#or
or7ani6ation duly re7istered 3ith the 5inistry of !a#or and E4ploy4ent; that there are 4ore or less
fifty(four (5)$ ran% and file e4ployees in SJE!C"; that al4ost 61< of the e4ployees sou7ht to #e
represented have supported the filin7 of the petition; that there has #een no valid certification
election held in SJE!C" durin7 the t3elve (01$ 4onth period prior to the filin7 of the petition and
that there is no other union in the #ar7ainin7 unit.
In its ans3er (pp. 02(10, Rollo$, SJE!C" opposed the petition for direct certification election
contendin7, inter alia, that the e4ployees 3ho sou7ht to #e represented #y private respondent are
4e4#ers(consu4ers of the Cooperative itself and at the sa4e ti4e co4posed the 9eneral
sse4#ly 3hich, pursuant to the .y(la3s is also the final ar#iter of any dispute arisin7 in the
Cooperative. Thus8
= = =
5. That so4e, if not 4ost, of the e4ployees 3ho sou7ht to #e represented #y the
petitioner, are 4e4#er(consu4ers, and as such are 4e4#ers of the 9eneral or
Special sse4#ly 3hich is the final ar#iter on any dispute 3hich a 4e4#er and>or
the .oard, or the Cooperative 4ay have, and that such ?so4e?of said alle7ed
supporters, in their capacity as 4e4#er(consu4ers, en,oy t3o personalities in that
as e4ployees and>or 4e4#ers of the 9eneral sse4#ly, and therefore cannot fairly
and prudently represent such opposin7 personalities that 4er7e into one ,uridical or
natural person, and these special and uni@ue status or personalities of the supposed
supporters cannot @ualify to #e represented #y the petitioner, 3ithout doin7 in,ustice,
in e@uity and unfair status or advanta7e to those 4e4#er(consu4ers 3ho have not
that destiny or status of #eco4in7 e4ployees;
6 /o valid and la3ful representation can #e o#tained #y petitioner in #ehalf of the
supposed supporters, 3ho are also 4e4#er(consu4er, that are #ound #y the rticle
of Incorporation, .y(la3s of the respondent Cooperative and pertinent -ecrees and
la3s, to support and defend the #asic policies of the 9overn4ent on Electric
Cooperatives;
A. There is no possi#le le7al 3ay #y 3hich to dis4antle the personalities of so4e of
the supporters of the petitioner, as e4ployees, fro4 their status as consu4er(
4e4#ers, 3ho are, under the .y(la3s, part and parcels of the 9eneral or Special
sse4#ly that finally decides any dispute, and no reasona#le or valid scale of ,ustice
could #e invo%ed to divide a person 3ho, in conscience, is also the other fello3
a7ainst 3ho4 a re4edy is sou7ht for in allo3in7 this to happen is tanta4ount to
slau7hterin7 a 4an to his o3n ends;
= = =
"n Septe4#er 5, 02'6, the 5ed(r#iter 3ho 3as assi7ned to the case issued an "rder (pp. 1)(
16, Rollo$ 7rantin7 the petition for direct certification election on the #asis of the pleadin7s filed. The
"rder said that 3hile so4e of the 4e4#ers of petitioner union are 4e4#ers of the cooperative, it
cannot #e denied that they are also e4ployees 3ithin the conte4plation of the !a#or Code and are
therefore entitled to en,oy all the #enefits of e4ployees, includin7 the ri7ht to self(or7ani6ation (pp.
15, Rollo$. This "rder 3as appealed #y SJE!C" to the .ureau of !a#or Relations.
In its appeal, (pp. 1A(&6, Rollo$ SJE!C" reiterated its position that8
. . . upon the principle that in electric cooperative B as in the case of respondent,
there is a mergerof the consu4er(4e4#ers that co4posed of the asse4#ly and that
of the ran%(and(file 4e4#ers of the petitioners(into one person or ,uridical status thus
renderin7 the proposed collective #ar7ainin7 a7ent ineffective and>or uncalled for B
considerin7 that a 7rievance 4achinery for e4ployees and>or 4e4#er(consu4ers of
the cooperative(has #een provided for #y the .y(la3s as a #uilt(in over(all ar#iter
involvin7 disputes affectin7 said cooperative;
Respondent -irector of the .ureau of !a#or Relations dis4issed the appeal and sustained the rulin7
of the 5ed(r#iter in an order dated January 5, 02'A.
"n +e#ruary 02, 02'A, SJE!C" filed the instant petition for certiorari prayin7 that the order of
respondent -irector #e set aside and another one rendered denyin7 the holdin7 or conduct of a
certification election a4on7 the ran% and file e4ployees of SJE!C".
In a letter dated June 1*, 02'A, tty. Ricardo Soto, Jr., counsel for private respondent union,
4anifested that a direct certification election 3as conducted in SJE!C", there #ein7 no restrainin7
order fro4 this Court en,oinin7 the holdin7 thereof !i%e3ise, tty. Soto 3as of the opinion that in vie3
of the direct certification election conducted, the petition #rou7ht #efore this Court #y SJE!C" has
#eco4e 4oot and acade4ic (p. )', Rollo$. ttached to his letter is a copy of the 4inutes of the
certification election held on pril 0&, 02'A sho3in7 that of forty three ()&$ e4ployees 3ho voted,
thirty (&*$ voted for respondent union and thirteen (0&$ voted for ?no union.?
In the resolution of this court (+irst -ivision$ dated Septe4#er 12, 02'A, respondents 3ere re@uired
to co44ent on the petition. The Solicitor 9eneral filed its co44ent dated "cto#er &*, 02'A 3herein
it too% a stand contrary to that of respondent -irector. To support its stand, the Solicitor 9eneral
ar7ued firstly, that the union 4e4#ers 3ho see% to #e represented #y the union are the very
4e4#ers of the cooperative, there#y resultin7 in a fusion of t3o personalities. Thus, it 3ill #e
inconsistent for the union 4e4#ers to #ar7ain 3ith the4selves. Secondly, he said that article 1)& of
the !a#or Code; re@uires that #efore one can for4, ,oin or assist a la#or union, he 4ust first #e
e4ployed and to #e an e4ployee one 4ust #e under hire and 4ust have no involve4ent in the
o3nership of the fir4. la#or union is for4ed for purposes of collective #ar7ainin7. The duty to
#ar7ain e=ists only #et3een e4ployer and e4ployees and not #et3een an e4ployer and his co(
o3ners. Thirdly, he also said that under the /ational Electrification -ecree (P.-. /o. 162, u7ust 6,
02A&$ 4e4#ers of an electric cooperative such as petitioner, #esides contri#utin7 financially to its
esta#lish4ents and 4aintenance, participate in its 4ana7e4ent. In the latter aspect, they possess
the po3ers and prero7atives of 4ana7erial e4ployees 3ho are not eli7i#le to ,oin, assist or for4 any
la#or or7ani6ation (pp. )(6 of Co44ent; pp )&()5, Rollo$.
"n /ove4#er 15, 02'A, Ce re@uired tty. Soto, Jr. to co44ent on the co44ent of the Solicitor
9eneral (p. )A,Rollo$. Do3ever, the notices sent to hi4 3ere returned and sta4ped ?4oved to an
un%no3n address.? .ut respondent -irector of the .ureau of !a#or Relations filed a co44ent on the
aforesaid co44ent of the Solicitor 9eneral reiteratin7 his stand that 4e4#ers of private respondent
union fall under the 7eneral provision of rticle 1)) of the Code on 3ho are @ualified to for4, ,oin or
assist in the for4ation of unions as they are neither 4ana7erial e4ployees nor persons #elon7in7 to
su#versive or7ani6ations. Thus, on 5ay 15, 02'', 3e 7ave due course to the petition (p. A2, Rollo$.
The only issue presented for resolution in this petition is 3hether or not the e4ployees(4e4#ers of
an electric cooperative can or7ani6e the4selves for purposes of collective #ar7ainin7.
This Court had the occasion to rule on this issue in the consolidated cases of Batangas I-Electric
Cooperative Labor Union vs. Romeo Young, et al., 9.R. /o. 61&'6, Bulacan II- Electric Cooperative,
Inc., vs. Hon. Eliseo A. Penalor, et al., 9.R. /o. A*''* and Alba! Electric Cooperative vs.
Crescencio B. "ra#ano et. al., 9.R. /o. A)56* (/ove4#er 2, 02''$, citin7 the case of Cooperative
Rural Ban$ o %avao Cit!, Inc. vs. Pura &errer-Calle#a, 9.R. /o. AA250, Septe4#er 16,02'', 3here it
3as held that8
cooperative, therefore, is #y its nature different fro4 an ordinary #usiness concern
#ein7 run either, #y persons, partnerships or corporations. Its o3ners and>or
4e4#ers are the ones 3ho run and operate the #usiness 3hile the others are its
e4ployees. s a#ove stated, irrespective of the na4e of shares o3ned #y its
4e4#ers they are entitled to cast one vote each in decidin7 upon the affair of the
cooperative. Their share capital earn li4ited interests, They en,oy special privile7es
as B e=e4ption fro4 inco4e ta= and sales ta=es, preferential ri7ht to supply their
products to State a7encies and even e=e4ption fro4 4ini4u4 3a7e la3s.
n e4ployee therefore of such a cooperative 3ho is a 4e4#er and co(o3ner thereof
cannot invo%e the ri7ht to collective #ar7ainin7 for certainly an o3ner cannot #ar7ain
3ith hi4self or his co(o3ners. In the opinion of u7ust 0), 02'0 of the Solicitor
9eneral, he corectly opined that e4ployees of cooperatives 3ho are the4selves
4e4#ers of the cooperative have no ri7ht to for4 or ,oin la#or or7ani6ations for
purposes of collective #ar7ainin7 for #ein7 the4selves co(o3ners of the cooperative.
Do3ever, in so far as it involves cooperatives 3ith e4ployees 3ho are not 4e4#ers
or co(o3ners thereof, certainly such e4ployees are entitled to e=ercise the ri7hts of
all 3or%ers to or7ani6ation, collective #ar7ainin7, ne7otiations and others as are
enshrined in the Constitution and e=istin7 la3s of the country.
In this petition, San Jose City Electric Service Cooperative, Inc. (SJE!C"$ clai4s that its
e4ployees are also 4e4#ers of the cooperative. It cited Section 0A(0'$ of its .y(la3s 3hich
declares that8
The .oard shall also create positions for su#ordinate e4ployees and fi= their duties
and re4unerations. 'nl! member-consumers or members o t(eir imme)iate amil!
s(all be emplo!e) b! t(e cooperative (E4phasis supplied$.
The a#ove(cited provision, ho3ever, 4entions t3o types of e4ployees, na4ely8 the 4e4#ers(
consu4ers and the 4e4#ers of their i44ediate fa4ilies. s re7ards e4ployees of SJE!C" 3ho
are 4e4#ers(consu4ers, the rule is settled that they are not @ualified to for4, ,oin or assist la#or
or7ani6ations for purposes of collective #ar7ainin7. The reason for 3ithholdin7 fro4 e4ployees of a
cooperative 3ho are 4e4#ers(co(o3ners the ri7ht to collective #ar7ainin7 is clear8 an o3ner cannot
#ar7ain 3ith hi4self. Do3ever, e4ployees 3ho are not 4e4#ers(consu4ers 4ay for4, ,oin or assist
la#or or7ani6ations for purposes of collective #ar7ainin7 not3ithstandin7 the fact that e4ployees of
SJE!C" 3ho are not 4e4#ers(consu4ers 3ere e4ployed "/!E #ecause they are 4e4#ers of
the i44ediate fa4ily of 4e4#ers(consu4ers. The fact re4ains that they are not the4selves
4e4#ers(consu4ers, and as such, they are entitled to e=ercise the ri7hts of all 3or%ers to
or7ani6ation, collective #ar7ainin7, ne7otiations and others as are enshrined in Section ', rticle III
and Section &, rticle FIII of the 02'A Constitution, !a#or Code of the Philippines and other related
la3s (Cooperative Rural .an% of -avao City, Inc., supra, p. 0*$.
CC"R-I/9!E, the petition is 9R/TE-. The assailed "rder of respondent Pura +errer(Calle,a,
-irector of the .ureau of !a#or Relations is here#y 5"-I+IE- to the effect that only the ran%(and(
file e4ployees of petitioner 3ho are not its 4e4#ers(consu4ers are entitled to self(or7ani6ation,
collective #ar7ainin7, and ne7otiations, 3hile other e4ployees 3ho are 4e4#ers(consu4ers thereof
cannot en,oy such ri7ht. The direct certification election conducted on pril 0&, 02'A is here#y set
aside. The Re7ional "ffice III of the -epart4ent of !a#or and E4ploy4ent in San +ernando,
Pa4pan7a is here#y directed8 (a$ to deter4ine the nu4#er of ran% and file e4ployees of SJE!C"
3ho are not the4selves 4e4#ers(consu4ers; (#$ to resolve 3hether or not there is co4pliance 3ith
the re@uire4ents set forth in rticle 15A of the !a#or Code; and (c$ in the affir4ative, to i44ediately
conduct a direct certification election a4on7 the ran% and file e4ployees of SJE!C" 3ho are not
4e4#ers(consu4ers.
S" "R-ERE-.
Case No. 2
G.R. No. 76273 July 31, 1987
FEU-DR. NICANOR REYE !EDICA" FOUNDA#ION, INC., petitioner,
vs.
$ON. CREENCIANO #RAJANO a%& RICARDO C. CA#RO, FAR
EA#ERN UNI'ERI#Y DR. NICANOR REYE !EDICA" FOUNDA#ION,
INC. A""IANCE OF FI"I(INO )OR*ER +AF),, respondents.
(ARA, J.:
This is a petition for certiorari seeking to annul and set aside the decision of
the respondent Director which afrmed the Order of the Med-Arbiter in the
petition for certication election !"#$-%$D-"-&-'('-)*+ led b, private
respondent, thus ordering the holding of a certication election among the
rank and le emplo,ees of the herein petitioner.
The facts of the case are as follows-
The petitioner, .ar /astern 0niversit,-Dr. "icanor $e,es Memorial
.oundation, 1nc., has a work force of about 2(' rank and le emplo,ees,
ma3orit, of whom are members of private respondent Alliance of .ilipino
4orkers.
On .ebruar, 52, 56)*, private respondent led a 7etition for #onsent and8or
#ertication /lection with The Ministr, of %abor and /mplo,ment. The
petitioner opposed the petition on the ground that a similar petition involving
the same issues and the same parties is pending resolution before the
9upreme #ourt, docketed as :.$. "o. %-;6<<5.
1n its position paper, private respondent admitted- that as earl, as Ma, 5',
56<*, private respondent led a similar petition for certication election with
the Ministr, of %abor and /mplo,ment but the petition was denied b, the
M/D Arbiter and the 9ecretar, of %abor on appeal, on the ground that the
petitioner was a non-stock, non-prot medical institution, therefore, its
emplo,ees ma, not form, 3oin, or organi=e a union pursuant to Article &;; of
the %abor #ode> that private respondent led a petition for certiorari with the
9upreme #ourt !docketed as :.$. "o. %-;6<<5+ assailing the constitutionalit,
of Article &;; of the %abor #ode> that pending resolution of the aforesaid
petition, or on Ma, 5, 56)', ?atas 7ambansa ?ilang <' was enacted
amending Article &;; of the %abor #ode, thus granting even emplo,ees of
non-stock, non-prot institutions the right to form, 3oin and organi=e labor
unions of their choice> and that in the e@ercise of such right, private
respondent led another petition for certication election with the Ministr, of
%abor and /mplo,ment !"#$-%$D-"-&-'('-)*+.
On April 5<, 56)*, the Med Arbiter issued an Order granting the petition,
declaring that a certication election be conducted to determine the
e@clusive bargaining representative of all the rank and le emplo,ees of the
petitioner !p. ;, $ollo+.
$espondent Director afrmed said Order on appeal. 1n dismissing the appeal,
however, respondent Director said that-
... respondentAs !petitioner herein, reliance on the petition with the
9upreme #ourt involving as it does the provisions of Article &;; of the
%abor #ode vis-a-vis the character of the hospital, which has been
alleged as a non-prot medical foundation, has been rendered moot
and academic b, virtue of the amendator, ?7 B<', which allows
emplo,ees of non-prot medical institutions to unioni=e.
4hatever doubt there ma, be on the right of the workers in a medical
institution has been laid to rest b, ?7B<'.
4C/$/.O$/, premises considered, the present appeal is hereb,
dismissed for lack of merit and the Order of the Med-Arbiter dated 5<
April 56)* afrmed. ... !p. 56, $ollo+
Cence, this petition, raising the issue of whether or not respondent Director
gravel, abused his discretion in granting the petition for certication
election, despite the pendenc, of a similar petition before the 9upreme #ourt
!:.$. "o. ;6<<5+ which involves the same parties for the same cause.
The 7etition is devoid of merit.
At the time private respondent led its petition for certication election on
.ebruar, 52, 56)*, Article &;; of the %abor #ode was alread, amended b,
?atas 7ambansa ?ilang <', to wit-
Art. &;;. #overage and emplo,eesA right to self-organi=ation. D All
persons emplo,ed in commercial, industrial and charitable, medical or
educational institutions whether operating for proft or not, shall have
the right to self-organi=ations of their own choosing for purposes of
collective bargaining. Ambulant intermittent and itinerant workers, self-
emplo,ed people, rural workers and those without an, denite
emplo,ers ma, form labor organi=ations for the purpose of enhancing
and defending their interests and for their mutual aid and protection.
!underscoring supplied+.
0nder the aforeEuoted provision, there is no doubt that rank and le
emplo,ees of non-prot medical institutions !as herein petitioner+ are now
permitted to form, organi=e or 3oin labor unions of their choice for purposes
of collective bargaining. 9ince private respondent had complied with the
reEuisites provided b, law for calling a certication election !p. 5(, $ollo+, it
was incumbent upon respondent Director to conduct such certication
election to ascertain the bargaining representative of petitionerAs emplo,ees
!9amahang Manggagawa "g 7acic Mills, 1nc. vs. "oriel, 52; 9#$A 5(&+.
As held in Quimpo v. Dela Victoria, ;* 9#$A 526, in order that the pendenc,
of another action between the same parties for the same cause ma, be
availed of as a ground to dismiss a case, there must be, between the action
under consideration and the other action- !5+ 1dentit, of parties, or at least
such as representing the same interest in both actions> !&+ 1dentit, of rights
asserted and relief pra,ed for, the relief being founded on the same facts>
and !2+ the 1dentit, on the two preceding particulars should be such that an,
3udgment which ma, be rendered on the other action wig, regardless of
which part, is successful, amount to res judicata in the action under
consideration.1avvphi1
1n the instant case, an, 3udgment which ma, be rendered in the petition for
certiorari pending before the 9upreme #ourt !:. $. "o. %-;6<<5+ wig not
constitute res judicata in the petition for certication election under
consideration, for while in the former, private respondent Euestioned the
constitutionalit, of Article &;; of the %abor #ode before its amendment, in
the latter, private respondent invokes the same article as alread, amended.
7etitioner, however, has pointed out that respondent Director should not
have arrogated upon himself the power to declare the aforesaid petition for
certiorari !:.$. "o. %-;6<<5+ moot and academic, as the same is sub-
judiceand onl, the 9upreme #ourt can decide the matter. The Director
cannot be faulted for he had to make a decision.
4C/$/.O$/, this petition is D19M199/D, and the decision appealed from is
hereb, A..1$M/D.
9O O$D/$/D.
"ee(an$ee, C.*., +arvasa, Cru, an) -anca!co, **., concur.
Ca&' No. 3
G.R. No. L%2(2)* S'+,'-.'/ 12, 197)
ENJAMIN VICTORIANO, plaintiff(appellee,
vs.
ELI0AL!E ROPE 1OR$ERS2 3NION a"# ELI0AL!E ROPE FACTORY, INC., #'4'"#a",&,
ELI0AL!E ROPE 1OR$ERS2 3NION, defendant(appellant.
.alonga, 'r)one,, Yap, .icat / Associates or plainti-appellee.
Cipriano Ci) / Associates or )een)ant-appellant.

0AL!IVAR, J.:p
ppeal to this Court on purely @uestions of la3 fro4 the decision of the Court of +irst Instance of
5anila in its Civil Case /o. 5''2).
The undisputed facts that spa3ned the instant case follo38
.en,a4in Gictoriano (hereinafter referred to as ppellee$, a 4e4#er of the reli7ious sect %no3n as
the ?I7lesia ni Cristo?, had #een in the e4ploy of the Eli6alde Rope +actory, Inc. (hereinafter referred
to as Co4pany$ since 025'. s such e4ployee, he 3as a 4e4#er of the Eli6alde Rope Cor%ersH
Inion (hereinafter referred to as Inion$ 3hich had 3ith the Co4pany a collective #ar7ainin7
a7ree4ent containin7 a closed shop provision 3hich reads as follo3s8
5e4#ership in the Inion shall #e re@uired as a condition of e4ploy4ent for all
per4anent e4ployees 3or%ers covered #y this 7ree4ent.
The collective #ar7ainin7 a7ree4ent e=pired on 5arch &, 026) #ut 3as rene3ed the follo3in7 day,
5arch ), 026).
Inder Section )(a$, para7raph ), of Repu#lic ct /o. 'A5, prior to its a4end4ent #y Repu#lic ct
/o. &&5*, the e4ployer 3as not precluded ?fro4 4a%in7 an a7ree4ent 3ith a la#or or7ani6ation to
re@uire as a condition of e4ploy4ent 4e4#ership therein, if such la#or or7ani6ation is the
representative of the e4ployees.? "n June 0', 0260, ho3ever, Repu#lic ct /o. &&5* 3as enacted,
introducin7 an a4end4ent to B para7raph ()$ su#section (a$ of section ) of Repu#lic ct /o. 'A5,
as follo3s8 ... ?#ut such a7ree4ent shall not cover 4e4#ers of any reli7ious sects 3hich prohi#it
affiliation of their 4e4#ers in any such la#or or7ani6ation?.
.ein7 a 4e4#er of a reli7ious sect that prohi#its the affiliation of its 4e4#ers 3ith any la#or
or7ani6ation, ppellee presented his resi7nation to appellant Inion in 0261, and 3hen no action 3as
ta%en thereon, he reiterated his resi7nation on Septe4#er &, 02A). Thereupon, the Inion 3rote a
for4al letter to the Co4pany as%in7 the latter to separate ppellee fro4 the service in vie3 of the
fact that he 3as resi7nin7 fro4 the Inion as a 4e4#er. The 4ana7e4ent of the Co4pany in turn
notified ppellee and his counsel that unless the ppellee could achieve a satisfactory arran7e4ent
3ith the Inion, the Co4pany 3ould #e constrained to dis4iss hi4 fro4 the service. This pro4pted
ppellee to file an action for in,unction, doc%eted as Civil Case /o. 5''2) in the Court of +irst
Instance of 5anila to en,oin the Co4pany and the Inion fro4 dis4issin7 ppellee.
1
In its ans3er, the
Inion invo%ed the ?union security clause? of the collective #ar7ainin7 a7ree4ent; assailed the
constitutionality of Repu#lic ct /o. &&5*; and contended that the Court had no ,urisdiction over the case,
pursuant to Repu#lic ct /o. 'A5, Sections 1) and 2 (d$ and (e$.
2
Ipon the facts a7reed upon #y the
parties durin7 the pre(trial conference, the Court a 0uo rendered its decision on u7ust 16, 0265, the
dispositive portion of 3hich reads8
I/ GIEC "+ TDE +"RE9"I/9, ,ud74ent is rendered en,oinin7 the defendant
Eli6alde Rope +actory, Inc. fro4 dis4issin7 the plaintiff fro4 his present e4ploy4ent
and sentencin7 the defendant Eli6alde Rope Cor%ersH Inion to pay the plaintiff P5**
for attorneyHs fees and the costs of this action.
3
+ro4 this decision, the Inion appealed directly to this Court on purely @uestions of la3, assi7nin7
the follo3in7 errors8
I. That the lo3er court erred 3hen it did not rule that Repu#lic ct /o. &&5* is
unconstitutional.
II. That the lo3er court erred 3hen it sentenced appellant herein to pay plaintiff the
su4 of P5** as attorneyHs fees and the cost thereof.
In support of the alle7ed unconstitutionality of Repu#lic ct /o. &&5*, the Inion contented, firstly,
that the ct infrin7es on the funda4ental ri7ht to for4 la3ful associations; that ?the very phraseolo7y
of said Repu#lic ct &&5*, that 4e4#ership in a la#or or7ani6ation is #anned to all those #elon7in7
to such reli7ious sect prohi#itin7 affiliation 3ith any la#or or7ani6ation?
)
, ?prohi#its all the 4e4#ers of
a 7iven reli7ious sect fro4 ,oinin7 any la#or union if such sect prohi#its affiliations of their 4e4#ers
thereto?
(
; and, conse@uently, deprives said 4e4#ers of their constitutional ri7ht to for4 or ,oin la3ful
associations or or7ani6ations 7uaranteed #y the .ill of Ri7hts, and thus #eco4es o#no=ious to rticle III,
Section 0 (6$ of the 02&5 Constitution.
*
Secondly, the Inion contended that Repu#lic ct /o. &&5* is unconstitutional for i4pairin7 the
o#li7ation of contracts in that, 3hile the Inion is o#li7ed to co4ply 3ith its collective #ar7ainin7
a7ree4ent containin7 a ?closed shop provision,? the ct relieves the e4ployer fro4 its reciprocal
o#li7ation of cooperatin7 in the 4aintenance of union 4e4#ership as a condition of e4ploy4ent;
and that said ct, further4ore, i4pairs the InionHs ri7hts as it deprives the union of dues fro4
4e4#ers 3ho, under the ct, are relieved fro4 the o#li7ation to continue as such 4e4#ers.
7
Thirdly, the Inion contended that Repu#lic ct /o. &&5* discri4inatorily favors those reli7ious sects
3hich #an their 4e4#ers fro4 ,oinin7 la#or unions, in violation of rticle Ill, Section 0 (A$ of the 02&5
Constitution; and 3hile said ct unduly protects certain reli7ious sects, it leaves no ri7hts or
protection to la#or or7ani6ations.
8
+ourthly, Repu#lic ct /o. &&5*, asserted the Inion, violates the constitutional provision that ?no
reli7ious test shall #e re@uired for the e=ercise of a civil ri7ht,? in that the la#orerHs e=ercise of his civil
ri7ht to ,oin associations for purposes not contrary to la3 has to #e deter4ined under the ct #y his
affiliation 3ith a reli7ious sect; that conversely, if a 3or%er has to sever his reli7ious connection 3ith
a sect that prohi#its 4e4#ership in a la#or or7ani6ation in order to #e a#le to ,oin a la#or
or7ani6ation, said ct 3ould violate reli7ious freedo4.
9
+ifthly, the Inion contended that Repu#lic ct /o. &&5*, violates the ?e@ual protection of la3s?
clause of the Constitution, it #ein7 a discri4inately le7islation, inas4uch as #y e=e4ptin7 fro4 the
operation of closed shop a7ree4ent the 4e4#ers of the ?I7lesia ni Cristo?, it has 7ranted said
4e4#ers undue advanta7es over their fello3 3or%ers, for 3hile the ct e=e4pts the4 fro4 union
o#li7ation and lia#ility, it nevertheless entitles the4 at the sa4e ti4e to the en,oy4ent of all
concessions, #enefits and other e4olu4ents that the union 4i7ht secure fro4 the e4ployer.
15
Si=thly, the Inion contended that Repu#lic ct /o. &&5* violates the constitutional provision
re7ardin7 the pro4otion of social ,ustice.
11
ppellant Inion, further4ore, asserted that a ?closed shop provision? in a collective #ar7ainin7
a7ree4ent cannot #e considered violative of reli7ious freedo4, as to call for the a4end4ent
introduced #y Repu#lic ct /o. &&5*;
12
and that unless Repu#lic ct /o. &&5* is declared
unconstitutional, trade unionis4 in this country 3ould #e 3iped out as e4ployers 3ould prefer to hire or
e4ploy 4e4#ers of the I7lesia ni Cristo in order to do a3ay 3ith la#or or7ani6ations.
13
ppellee, assailin7 appellantHs ar7u4ents, contended that Repu#lic ct /o. &&5* does not violate
the ri7ht to for4 la3ful associations, for the ri7ht to ,oin associations includes the ri7ht not to ,oin or
to resi7n fro4 a la#or or7ani6ation, if oneHs conscience does not allo3 his 4e4#ership therein, and
the ct has 7iven su#stance to such ri7ht #y prohi#itin7 the co4pulsion of 3or%ers to ,oin la#or
or7ani6ations;
1)
that said ct does not i4pair the o#li7ation of contracts for said la3 for4ed part of, and
3as incorporated into, the ter4s of the closed shop a7ree4ent;
1(
that the ct does not violate the
esta#lish4ent of reli7ion clause or separation of Church and State, for Con7ress, in enactin7 said la3,
4erely acco44odated the reli7ious needs of those 3or%ers 3hose reli7ion prohi#its its 4e4#ers fro4
,oinin7 la#or unions, and #alanced the collective ri7hts of or7ani6ed la#or 3ith the constitutional ri7ht of an
individual to freely e=ercise his chosen reli7ion; that the constitutional ri7ht to the free e=ercise of oneHs
reli7ion has pri4acy and preference over union security 4easures 3hich are 4erely contractual
1*
; that
said ct does not violate the constitutional provision of e@ual protection, for the classification of 3or%ers
under the ct dependin7 on their reli7ious tenets is #ased on su#stantial distinction, is 7er4ane to the
purpose of the la3, and applies to all the 4e4#ers of a 7iven class;
17
that said ct, finally, does not
violate the social ,ustice policy of the Constitution, for said ct 3as enacted precisely to e@uali6e
e4ploy4ent opportunities for all citi6ens in the 4idst of the diversities of their reli7ious #eliefs.?
18
I. .efore Ce proceed to the discussion of the first assi7ned error, it is necessary to pre4ise that
there are so4e thorou7hly esta#lished principles 3hich 4ust #e follo3ed in all cases 3here
@uestions of constitutionality as o#tains in the instant case are involved. ll presu4ptions are
indul7ed in favor of constitutionality; one 3ho attac%s a statute, alle7in7 unconstitutionality 4ust
prove its invalidity #eyond a reasona#le dou#t, that a la3 4ay 3or% hardship does not render it
unconstitutional; that if any reasona#le #asis 4ay #e conceived 3hich supports the statute, it 3ill #e
upheld, and the challen7er 4ust ne7ate all possi#le #ases; that the courts are not concerned 3ith
the 3isdo4, ,ustice, policy, or e=pediency of a statute; and that a li#eral interpretation of the
constitution in favor of the constitutionality of le7islation should #e adopted.
19
0. ppellant InionHs contention that Repu#lic ct /o. &&5* pro(ibits and #ans the 4e4#ers of such
reli7ious sects that for#id affiliation of their 4e4#ers 3ith la#or unions fro4 ,oinin7 la#or unions
appears no3here in the 3ordin7 of Repu#lic ct /o. &&5*; neither can the sa4e #e deduced #y
necessary i4plication therefro4. It is not surprisin7, therefore, that appellant, havin7 thus 4isread
the ct, co44itted the error of contendin7 that said ct is o#no=ious to the constitutional provision
on freedo4 of association.
.oth the Constitution and Repu#lic ct /o. 'A5 reco7ni6e freedo4 of association. Section 0 (6$ of
rticle III of the Constitution of 02&5, as 3ell as Section A of rticle IG of the Constitution of 02A&,
provide that the ri7ht to for4 associations or societies for purposes not contrary to la3 shall not #e
a#rid7ed. Section & of Repu#lic ct /o. 'A5 provides that e4ployees shall have the ri7ht to self(
or7ani6ation and to for4, ,oin of assist la#or or7ani6ations of their o3n choosin7 for the purpose of
collective #ar7ainin7 and to en7a7e in concerted activities for the purpose of collective #ar7ainin7
and other 4utual aid or protection. Chat the Constitution and the Industrial Peace ct reco7ni6e and
7uarantee is the ?ri7ht? to for4 or ,oin associations. /ot3ithstandin7 the different theories
propounded #y the different schools of ,urisprudence re7ardin7 the nature and contents of a ?ri7ht?, it
can #e safely said that 3hatever theory one su#scri#es to, a ri7ht co4prehends at least t3o #road
notions, na4ely8 first, li#erty or freedo4, i.e., the a#sence of le7al restraint, 3here#y an e4ployee
4ay act for hi4self 3ithout #ein7 prevented #y la3; and second, po3er, 3here#y an e4ployee 4ay,
as he pleases, ,oin or refrain fro4 Joinin7 an association. It is, therefore, the e4ployee 3ho should
decide for hi4self 3hether he should ,oin or not an association; and should he choose to ,oin, he
hi4self 4a%es up his 4ind as to 3hich association he 3ould ,oin; and even after he has ,oined, he
still retains the li#erty and the po3er to leave and cancel his 4e4#ership 3ith said or7ani6ation at
any ti4e.
25
It is clear, therefore, that the ri7ht to ,oin a union includes the ri7ht to a#stain fro4 ,oinin7 any
union.
21
Inas4uch as 3hat #oth the Constitution and the Industrial Peace ct have reco7ni6ed, and
7uaranteed to the e4ployee, is the ?ri7ht? to ,oin associations of his choice, it 3ould #e a#surd to say that
the la3 also i4poses, in the sa4e #reath, upon the e4ployee the duty to ,oin associations. The la3 does
not en,oin an e4ployee to si7n up 3ith any association.
The ri7ht to refrain fro4 ,oinin7 la#or or7ani6ations reco7ni6ed #y Section & of the Industrial Peace
ct is, ho3ever, li4ited. The le7al protection 7ranted to such ri7ht to refrain fro4 ,oinin7 is 3ithdra3n
#y operation of la3, 3here a la#or union and an e4ployer have a7reed on a closed shop, #y virtue of
3hich the e4ployer 4ay e4ploy only 4e4#er of the collective #ar7ainin7 union, and the e4ployees
4ust continue to #e 4e4#ers of the union for the duration of the contract in order to %eep their ,o#s.
Thus Section ) (a$ ()$ of the Industrial Peace ct, #efore its a4end4ent #y Repu#lic ct /o. &&5*,
provides that althou7h it 3ould #e an unfair la#or practice for an e4ployer ?to discri4inate in re7ard
to hire or tenure of e4ploy4ent or any ter4 or condition of e4ploy4ent to encoura7e or discoura7e
4e4#ership in any la#or or7ani6ation? the e4ployer is, ho3ever, not precluded ?fro4 4a%in7 an
a7ree4ent 3ith a la#or or7ani6ation to re@uire as a condition of e4ploy4ent 4e4#ership therein, if
such la#or or7ani6ation is the representative of the e4ployees?. .y virtue, therefore, of a closed
shop a7ree4ent, #efore the enact4ent of Repu#lic ct /o. &&5*, if any person, re7ardless of his
reli7ious #eliefs, 3ishes to #e e4ployed or to %eep his e4ploy4ent, he 4ust #eco4e a 4e4#er of
the collective #ar7ainin7 union. Dence, the ri7ht of said e4ployee not to ,oin the la#or union is
curtailed and 3ithdra3n.
To that all(e4#racin7 covera7e of the closed shop arran7e4ent, Repu#lic ct /o. &&5* introduced
an e=ception, 3hen it added to Section ) (a$ ()$ of the Industrial Peace ct the follo3in7 proviso8 ?#ut
such a7ree4ent shall not cover 4e4#ers of any reli7ious sects 3hich prohi#it affiliation of their
4e4#ers in any such la#or or7ani6ation?. Repu#lic ct /o. &&5* 4erely e=cludes ipso #ure fro4 the
application and covera7e of the closed shop a7ree4ent the e4ployees #elon7in7 to any reli7ious
sects 3hich prohi#it affiliation of their 4e4#ers 3ith any la#or or7ani6ation. Chat the e=ception
provides, therefore, is that 4e4#ers of said reli7ious sects cannot #e co4pelled or coerced to ,oin
la#or unions even 3hen said unions have closed shop a7ree4ents 3ith the e4ployers; that in spite
of any closed shop a7ree4ent, 4e4#ers of said reli7ious sects cannot #e refused e4ploy4ent or
dis4issed fro4 their ,o#s on the sole 7round that they are not 4e4#ers of the collective #ar7ainin7
union. It is clear, therefore, that the assailed ct, far fro4 infrin7in7 the constitutional provision on
freedo4 of association, upholds and reinforces it. It does not prohi#it the 4e4#ers of said reli7ious
sects fro4 affiliatin7 3ith la#or unions. It still leaves to said 4e4#ers the li#erty and the po3er to
affiliate, or not to affiliate, 3ith la#or unions. If, not3ithstandin7 their reli7ious #eliefs, the 4e4#ers of
said reli7ious sects prefer to si7n up 3ith the la#or union, they can do so. If in deference and fealty
to their reli7ious faith, they refuse to si7n up, they can do so; the la3 does not coerce the4 to ,oin;
neither does the la3 prohi#it the4 fro4 ,oinin7; and neither 4ay the e4ployer or la#or union co4pel
the4 to ,oin. Repu#lic ct /o. &&5*, therefore, does not violate the constitutional provision on
freedo4 of association.
1. ppellant Inion also contends that the ct is unconstitutional for i4pairin7 the o#li7ation of its
contract, specifically, the ?union security clause? e4#odied in its Collective .ar7ainin7 7ree4ent
3ith the Co4pany, #y virtue of 3hich ?4e4#ership in the union 3as re@uired as a condition for
e4ploy4ent for all per4anent e4ployees 3or%ers?. This a7ree4ent 3as already in e=istence at the
ti4e Repu#lic ct /o. &&5* 3as enacted on June 0', 0260, and it cannot, therefore, #e dee4ed to
have #een incorporated into the a7ree4ent. .ut #y reason of this a4end4ent, ppellee, as 3ell as
others si4ilarly situated, could no lon7er #e dis4issed fro4 his ,o# even if he should cease to #e a
4e4#er, or disaffiliate fro4 the Inion, and the Co4pany could continue e4ployin7 hi4
not3ithstandin7 his disaffiliation fro4 the Inion. The ct, therefore, introduced a chan7e into the
e=press ter4s of the union security clause; the Co4pany 3as partly a#solved #y la3 fro4 the
contractual o#li7ation it had 3ith the Inion of e4ployin7 only Inion 4e4#ers in per4anent
positions, It cannot #e denied, therefore, that there 3as indeed an i4pair4ent of said union security
clause.
ccordin7 to .lac%, any statute 3hich introduces a chan7e into the e=press ter4s of the contract, or
its le7al construction, or its validity, or its dischar7e, or the re4edy for its enforce4ent, i4pairs the
contract. The e=tent of the chan7e is not 4aterial. It is not a @uestion of de7ree or 4anner or cause,
#ut of encroachin7 in any respect on its o#li7ation or dispensin7 3ith any part of its force. There is
an i4pair4ent of the contract if either party is a#solved #y la3 fro4 its perfor4ance.
22
I4pair4ent
has also #een predicated on la3s 3hich, 3ithout destroyin7 contracts, dero7ate fro4 su#stantial
contractual ri7hts.
23
It should not #e overloo%ed, ho3ever, that the prohi#ition to i4pair the o#li7ation of contracts is not
a#solute and un@ualified. The prohi#ition is 7eneral, affordin7 a #road outline and re@uirin7
construction to fill in the details. The prohi#ition is not to #e read 3ith literal e=actness li%e a
4athe4atical for4ula, for it prohi#its unreasona#le i4pair4ent only.
2)
In spite of the constitutional
prohi#ition, the State continues to possess authority to safe7uard the vital interests of its people.
!e7islation appropriate to safe7uardin7 said interests 4ay 4odify or a#ro7ate contracts already in
effect.
2(
+or not only are e=istin7 la3s read into contracts in order to fi= the o#li7ations as #et3een the
parties, #ut the reservation of essential attri#utes of soverei7n po3er is also read into contracts as a
postulate of the le7al order. ll contracts 4ade 3ith reference to any 4atter that is su#,ect to re7ulation
under the police po3er 4ust #e understood as 4ade in reference to the possi#le e=ercise of that
po3er.
2*
"ther3ise, i4portant and valua#le refor4s 4ay #e precluded #y the si4ple device of enterin7
into contracts for the purpose of doin7 that 3hich other3ise 4ay #e prohi#ited. The policy of protectin7
contracts a7ainst i4pair4ent presupposes the 4aintenance of a 7overn4ent #y virtue of 3hich
contractual relations are 3orth3hile a 7overn4ent 3hich retains ade@uate authority to secure the peace
and 7ood order of society. The contract clause of the Constitution 4ust, therefore, #e not only in har4ony
3ith, #ut also in su#ordination to, in appropriate instances, the reserved po3er of the state to safe7uard
the vital interests of the people. It follo3s that not all le7islations, 3hich have the effect of i4pairin7 a
contract, are o#no=ious to the constitutional prohi#ition as to i4pair4ent, and a statute passed in the
le7iti4ate e=ercise of police po3er, althou7h it incidentally destroys e=istin7 contract ri7hts, 4ust #e
upheld #y the courts. This has special application to contracts re7ulatin7 relations #et3een capital and
la#or 3hich are not 4erely contractual, and said la#or contracts, for #ein7 i4pressed 3ith pu#lic interest,
4ust yield to the co44on 7ood.
27
In several occasions this Court declared that the prohi#ition a7ainst i4pairin7 the o#li7ations of
contracts has no application to statutes relatin7 to pu#lic su#,ects 3ithin the do4ain of the 7eneral
le7islative po3ers of the state involvin7 pu#lic 3elfare.
28
Thus, this Court also held that the .lue
Sunday !a3 3as not an infrin7e4ent of the o#li7ation of a contract that re@uired the e4ployer to furnish
3or% on Sundays to his e4ployees, the la3 havin7 #een enacted to secure the 3ell(#ein7 and happiness
of the la#orin7 class, and #ein7, further4ore, a le7iti4ate e=ercise of the police po3er.
29
In order to deter4ine 3hether le7islation unconstitutionally i4pairs contract o#li7ations, no
unchan7in7 yardstic%, applica#le at all ti4es and under all circu4stances, #y 3hich the validity of
each statute 4ay #e 4easured or deter4ined, has #een fashioned, #ut every case 4ust #e
deter4ined upon its o3n circu4stances. !e7islation i4pairin7 the o#li7ation of contracts can #e
sustained 3hen it is enacted for the pro4otion of the 7eneral 7ood of the people, and 3hen the
4eans adopted to secure that end are reasona#le. .oth the end sou7ht and the 4eans adopted
4ust #e le7iti4ate, i.e., 3ithin the scope of the reserved po3er of the state construed in har4ony
3ith the constitutional li4itation of that po3er.
35
Chat then 3as the purpose sou7ht to #e achieved #y Repu#lic ct /o. &&5*J Its purpose 3as to
insure freedo4 of #elief and reli7ion, and to pro4ote the 7eneral 3elfare #y preventin7
discri4ination a7ainst those 4e4#ers of reli7ious sects 3hich prohi#it their 4e4#ers fro4 ,oinin7
la#or unions, confir4in7 there#y their natural, statutory and constitutional ri7ht to 3or%, the fruits of
3hich 3or% are usually the only 4eans 3here#y they can 4aintain their o3n life and the life of their
dependents. It cannot #e 7ainsaid that said purpose is le7iti4ate.
The @uestioned ct also provides protection to 4e4#ers of said reli7ious sects a7ainst t3o
a77re7ates of 7roup stren7th fro4 3hich the individual needs protection. The individual e4ployee, at
various ti4es in his 3or%in7 life, is confronted #y t3o a77re7ates of po3er B collective la#or,
directed #y a union, and collective capital, directed #y 4ana7e4ent. The union, an institution
developed to or7ani6e la#or into a collective force and thus protect the individual e4ployee fro4 the
po3er of collective capital, is, parado=ically, #oth the cha4pion of e4ployee ri7hts, and a ne3
source of their frustration. 5oreover, 3hen the Inion interacts 3ith 4ana7e4ent, it produces yet a
third a77re7ate of 7roup stren7th fro4 3hich the individual also needs protection B the collective
#ar7ainin7 relationship.
31
The afore4entioned purpose of the a4endatory la3 is clearly seen in the E=planatory /ote to Douse
.ill /o. 5'52, 3hich later #eca4e Repu#lic ct /o. &&5*, as follo3s8
It 3ould #e unthin%a#le indeed to refuse e4ployin7 a person 3ho, on account of his
reli7ious #eliefs and convictions, cannot accept 4e4#ership in a la#or or7ani6ation
althou7h he possesses all the @ualifications for the ,o#. This is tanta4ount to
punishin7 such person for #elievin7 in a doctrine he has a ri7ht under the la3 to
#elieve in. The la3 3ould not allo3 discri4ination to flourish to the detri4ent of those
3hose reli7ion discards 4e4#ership in any la#or or7ani6ation. !i%e3ise, the la3
3ould not co44end the deprivation of their ri7ht to 3or% and pursue a 4odest
4eans of livelihood, 3ithout in any 4anner violatin7 their reli7ious faith and>or
#elief.
32
It cannot #e denied, further4ore, that the 4eans adopted #y the ct to achieve that purpose B
e=e4ptin7 the 4e4#ers of said reli7ious sects fro4 covera7e of union security a7ree4ents B is
reasona#le.
It 4ay not #e a4iss to point out here that the free e=ercise of reli7ious profession or #elief is superior
to contract ri7hts. In case of conflict, the latter 4ust, therefore, yield to the for4er. The Supre4e
Court of the Inited States has also declared on several occasions that the ri7hts in the +irst
4end4ent, 3hich include freedo4 of reli7ion, en,oy a preferred position in the constitutional
syste4.
33
Reli7ious freedo4, althou7h not unli4ited, is a funda4ental personal ri7ht and li#erty,
3)
and
has a preferred position in the hierarchy of values. Contractual ri7hts, therefore, 4ust yield to freedo4 of
reli7ion. It is only 3here unavoida#ly necessary to prevent an i44ediate and 7rave dan7er to the security
and 3elfare of the co44unity that infrin7e4ent of reli7ious freedo4 4ay #e ,ustified, and only to the
s4allest e=tent necessary to avoid the dan7er.
&. In further support of its contention that Repu#lic ct /o. &&5* is unconstitutional, appellant Inion
averred that said ct discri4inates in favor of 4e4#ers of said reli7ious sects in violation of Section
0 (A$ of rticle Ill of the 02&5 Constitution, and 3hich is no3 Section ' of rticle IG of the 02A&
Constitution, 3hich provides8
/o la3 shall #e 4ade respectin7 an esta#lish4ent of reli7ion, or prohi#itin7 the free
e=ercise thereof, and the free e=ercise and en,oy4ent of reli7ious profession and
3orship, 3ithout discri4ination and preference, shall forever #e allo3ed. /o reli7ious
test shall #e re@uired for the e=ercise of civil or political ri7hts.
The constitutional provision into only prohi#its le7islation for the support of any reli7ious tenets or the
4odes of 3orship of any sect, thus forestallin7 co4pulsion #y la3 of the acceptance of any creed or
the practice of any for4 of 3orship,
3(
#ut also assures the free e=ercise of oneHs chosen for4 of reli7ion
3ithin li4its of ut4ost a4plitude. It has #een said that the reli7ion clauses of the Constitution are all
desi7ned to protect the #roadest possi#le li#erty of conscience, to allo3 each 4an to #elieve as his
conscience directs, to profess his #eliefs, and to live as he #elieves he ou7ht to live, consistent 3ith the
li#erty of others and 3ith the co44on 7ood.
3*
ny le7islation 3hose effect or purpose is to i4pede the
o#servance of one or all reli7ions, or to discri4inate invidiously #et3een the reli7ions, is invalid, even
thou7h the #urden 4ay #e characteri6ed as #ein7 only indirect.
37
.ut if the sta7e re7ulates conduct #y
enactin7, 3ithin its po3er, a 7eneral la3 3hich has for its purpose and effect to advance the stateHs
secular 7oals, the statute is valid despite its indirect #urden on reli7ious o#servance, unless the state can
acco4plish its purpose 3ithout i4posin7 such #urden.
38
In Aglipa! v. Rui,
39
, this Court had occasion to state that the 7overn4ent should not #e precluded fro4
pursuin7 valid o#,ectives secular in character even if the incidental result 3ould #e favora#le to a reli7ion
or sect. It has li%e3ise #een held that the statute, in order to 3ithstand the strictures of constitutional
prohi#ition, 4ust have a secular le7islative purpose and a pri4ary effect that neither advances nor inhi#its
reli7ion.
)5
ssessed #y these criteria, Repu#lic ct /o. &&5* cannot #e said to violate the constitutional
inhi#ition of the ?no(esta#lish4ent? (of reli7ion$ clause of the Constitution.
The purpose of Repu#lic ct /o. &&5* is secular, 3orldly, and te4poral, not spiritual or reli7ious or
holy and eternal. It 3as intended to serve the secular purpose of advancin7 the constitutional ri7ht to
the free e=ercise of reli7ion, #y avertin7 that certain persons #e refused 3or%, or #e dis4issed fro4
3or%, or #e dispossessed of their ri7ht to 3or% and of #ein7 i4peded to pursue a 4odest 4eans of
livelihood, #y reason of union security a7ree4ents. To help its citi6ens to find 7ainful e4ploy4ent
3here#y they can 4a%e a livin7 to support the4selves and their fa4ilies is a valid o#,ective of the
state. In fact, the state is en,oined, in the 02&5 Constitution, to afford protection to la#or, and re7ulate
the relations #et3een la#or and capital and industry.
)1
5ore so no3 in the 02A& Constitution 3here it is
4andated that ?the State shall afford protection to la#or, pro4ote full e4ploy4ent and e@uality in
e4ploy4ent, ensure e@ual 3or% opportunities re7ardless of se=, race or creed and re7ulate the relation
#et3een 3or%ers and e4ployers.
)2
The pri4ary effects of the e=e4ption fro4 closed shop a7ree4ents in favor of 4e4#ers of reli7ious
sects that prohi#it their 4e4#ers fro4 affiliatin7 3ith a la#or or7ani6ation, is the protection of said
e4ployees a7ainst the a77re7ate force of the collective #ar7ainin7 a7ree4ent, and relievin7 certain
citi6ens of a #urden on their reli7ious #eliefs; and #y eli4inatin7 to a certain e=tent econo4ic
insecurity due to une4ploy4ent, 3hich is a serious 4enace to the health, 4orals, and 3elfare of the
people of the State, the ct also pro4otes the 3ell(#ein7 of society. It is our vie3 that the e=e4ption
fro4 the effects of closed shop a7ree4ent does not directly advance, or di4inish, the interests of
any particular reli7ion. lthou7h the e=e4ption 4ay #enefit those 3ho are 4e4#ers of reli7ious
sects that prohi#it their 4e4#ers fro4 ,oinin7 la#or unions, the #enefit upon the reli7ious sects is
4erely incidental and indirect. The ?esta#lish4ent clause? (of reli7ion$ does not #an re7ulation on
conduct 3hose reason or effect 4erely happens to coincide or har4oni6e 3ith the tenets of so4e or
all reli7ions.
)3
The free e=ercise clause of the Constitution has #een interpreted to re@uire that reli7ious
e=ercise #e preferentially aided.
))
Ce #elieve that in enactin7 Repu#lic ct /o. &&5*, Con7ress acted consistently 3ith the spirit of the
constitutional provision. It acted 4erely to relieve the e=ercise of reli7ion, #y certain persons, of a
#urden that is i4posed #y union security a7ree4ents. It 3as Con7ress itself that i4posed that
#urden 3hen it enacted the Industrial Peace ct (Repu#lic ct 'A5$, and, certainly, Con7ress, if it so
dee4s advisa#le, could ta%e a3ay the sa4e #urden. It is certain that not every conscience can #e
acco44odated #y all the la3s of the land; #ut 3hen 7eneral la3s conflict 3ith scrupples of
conscience, e=e4ptions ou7ht to #e 7ranted unless so4e ?co4pellin7 state interest? intervenes.
)(
In
the instant case, Ce see no such co4pellin7 state interest to 3ithhold e=e4ption.
ppellant #e3ails that 3hile Repu#lic ct /o. &&5* protects 4e4#ers of certain reli7ious sects, it
leaves no ri7ht to, and is silent as to the protection of, la#or or7ani6ations. The purpose of Repu#lic
ct /o. &&5* 3as not to 7rant ri7hts to la#or unions. The ri7hts of la#or unions are a4ply provided
for in Repu#lic ct /o. 'A5 and the ne3 !a#or Code. s to the la4ented silence of the ct re7ardin7
the ri7hts and protection of la#or unions, suffice it to say, first, that the validity of a statute is
deter4ined #y its provisions, not #y its silence
)*
; and, second, the fact that the la3 4ay 3or% hardship
does not render it unconstitutional.
)7
It 3ould not #e a4iss to state, re7ardin7 this 4atter, that to co4pel persons to ,oin and re4ain
4e4#ers of a union to %eep their ,o#s in violation of their reli7ious scrupples, 3ould hurt, rather than
help, la#or unions, Con7ress has seen it fit to e=e4pt reli7ious o#,ectors lest their resistance spread
to other 3or%ers, for reli7ious o#,ections have conta7ious potentialities 4ore than political and
philosophic o#,ections.
+urther4ore, let it #e noted that coerced unity and loyalty even to the country, and a ortiori to a
la#or B union assu4in7 that such unity and loyalty can #e attained throu7h coercion B is not a 7oal
that is constitutionally o#taina#le at the e=pense of reli7ious li#erty.
)8
desira#le end cannot #e
pro4oted #y prohi#ited 4eans.
). ppellantsH fourth contention, that Repu#lic ct /o. &&5* violates the constitutional prohi#ition
a7ainst re@uirin7 a reli7ious test for the e=ercise of a civil ri7ht or a political ri7ht, is not 3ell ta%en.
The ct does not re@uire as a @ualification, or condition, for ,oinin7 any la3ful association
4e4#ership in any particular reli7ion or in any reli7ious sect; neither does the ct re@uire affiliation
3ith a reli7ious sect that prohi#its its 4e4#ers fro4 ,oinin7 a la#or union as a condition or
@ualification for 3ithdra3in7 fro4 a la#or union. Joinin7 or 3ithdra3in7 fro4 a la#or union re@uires a
positive act. Repu#lic ct /o. &&5* only e=e4pts 4e4#ers 3ith such reli7ious affiliation fro4 the
covera7e of closed shop a7ree4ents. So, under this ct, a reli7ious o#,ector is not re@uired to do a
positive act B to e=ercise the ri7ht to ,oin or to resi7n fro4 the union. De is e=e4pted ipso
#ure 3ithout need of any positive act on his part. conscientious reli7ious o#,ector need not perfor4
a positive act or e=ercise the ri7ht of resi7nin7 fro4 the la#or union B he is e=e4pted fro4 the
covera7e of any closed shop a7ree4ent that a la#or union 4ay have entered into. Do3 then can
there #e a reli7ious test re@uired for the e=ercise of a ri7ht 3hen no ri7ht need #e e=ercisedJ
Ce have said that it 3as 3ithin the police po3er of the State to enact Repu#lic ct /o. &&5*, and
that its purpose 3as le7al and in consonance 3ith the Constitution. It is never an ille7al evasion of a
constitutional provision or prohi#ition to acco4plish a desired result, 3hich is la3ful in itself, #y
discoverin7 or follo3in7 a le7al 3ay to do it.
)9
5. ppellant avers as its fifth 7round that Repu#lic ct /o. &&5* is a discri4inatory le7islation,
inas4uch as it 7rants to the 4e4#ers of certain reli7ious sects undue advanta7es over other
3or%ers, thus violatin7 Section 0 of rticle III of the 02&5 Constitution 3hich for#ids the denial to any
person of the e@ual protection of the la3s.
(5
The 7uaranty of e@ual protection of the la3s is not a 7uaranty of e@uality in the application of the
la3s upon all citi6ens of the state. It is not, therefore, a re@uire4ent, in order to avoid the
constitutional prohi#ition a7ainst ine@uality, that every 4an, 3o4an and child should #e affected
ali%e #y a statute. E@uality of operation of statutes does not 4ean indiscri4inate operation on
persons 4erely as such, #ut on persons accordin7 to the circu4stances surroundin7 the4. It
7uarantees e@uality, not identity of ri7hts. The Constitution does not re@uire that thin7s 3hich are
different in fact #e treated in la3 as thou7h they 3ere the sa4e. The e@ual protection clause does
not for#id discri4ination as to thin7s that are different.
(1
It does not prohi#it le7islation 3hich is li4ited
either in the o#,ect to 3hich it is directed or #y the territory 3ithin 3hich it is to operate.
The e@ual protection of the la3s clause of the Constitution allo3s classification. Classification in la3,
as in the other depart4ents of %no3led7e or practice, is the 7roupin7 of thin7s in speculation or
practice #ecause they a7ree 3ith one another in certain particulars. la3 is not invalid #ecause of
si4ple ine@uality.
(2
The very idea of classification is that of ine@uality, so that it 7oes 3ithout sayin7 that
the 4ere fact of ine@uality in no 4anner deter4ines the 4atter of constitutionality.
(3
ll that is re@uired of
a valid classification is that it #e reasona#le, 3hich 4eans that the classification should #e #ased on
su#stantial distinctions 3hich 4a%e for real differences; that it 4ust #e 7er4ane to the purpose of the la3;
that it 4ust not #e li4ited to e=istin7 conditions only; and that it 4ust apply e@ually to each 4e4#er of the
class.
()
This Court has held that the standard is satisfied if the classification or distinction is #ased on a
reasona#le foundation or rational #asis and is not palpa#ly ar#itrary.
((
In the e=ercise of its po3er to 4a%e classifications for the purpose of enactin7 la3s over 4atters
3ithin its ,urisdiction, the state is reco7ni6ed as en,oyin7 a 3ide ran7e of discretion.
(*
It is not
necessary that the classification #e #ased on scientific or 4ar%ed differences of thin7s or in their
relation.
(7
/either is it necessary that the classification #e 4ade 3ith 4athe4atical nicety.
(8
Dence
le7islative classification 4ay in 4any cases properly rest on narro3 distinctions,
(9
for the e@ual protection
7uaranty does not preclude the le7islature fro4 reco7ni6in7 de7rees of evil or har4, and le7islation is
addressed to evils as they 4ay appear.
Ce #elieve that Repu#lic ct /o. &&5* satisfies the afore4entioned re@uire4ents. The ct classifies
e4ployees and 3or%ers, as to the effect and covera7e of union shop security a7ree4ents, into those
3ho #y reason of their reli7ious #eliefs and convictions cannot si7n up 3ith a la#or union, and those
3hose reli7ion does not prohi#it 4e4#ership in la#or unions. Tile classification rests on real or
su#stantial, not 4erely i4a7inary or 3hi4sical, distinctions. There is such real distinction in the
#eliefs, feelin7s and senti4ents of e4ployees. E4ployees do not #elieve in the sa4e reli7ious faith
and different reli7ions differ in their do74as and cannons. Reli7ious #eliefs, 4anifestations and
practices, thou7h they are found in all places, and in all ti4es, ta%e so 4any varied for4s as to #e
al4ost #eyond i4a7ination. There are 4any vie3s that co4prise the #road spectru4 of reli7ious
#eliefs a4on7 the people. There are diverse 4anners in 3hich #eliefs, e@ually para4ount in the
lives of their possessors, 4ay #e articulated. Today the country is far 4ore hetero7enous in reli7ion
than #efore, differences in reli7ion do e=ist, and these differences are i4portant and should not #e
i7nored.
Even fro4 the phycholo7ical point of vie3, the classification is #ased on real and i4portant
differences. Reli7ious #eliefs are not 4ere #eliefs, 4ere ideas e=istin7 only in the 4ind, for they
carry 3ith the4 practical conse@uences and are the 4otives of certain rules. of hu4an conduct and
the ,ustification of certain acts.
*5
Reli7ious senti4ent 4a%es a 4an vie3 thin7s and events in their
relation to his 9od. It 7ives to hu4an life its distinctive character, its tone, its happiness or unhappiness its
en,oy4ent or ir%so4eness. Isually, a stron7 and passionate desire is involved in a reli7ious #elief. To
certain persons, no sin7le factor of their e=perience is 4ore i4portant to the4 than their reli7ion, or their
not havin7 any reli7ion. .ecause of differences in reli7ious #elief and senti4ents, a very poor person 4ay
consider hi4self #etter than the rich, and the 4an 3ho even lac%s the necessities of life 4ay #e 4ore
cheerful than the one 3ho has all possi#le lu=uries. -ue to their reli7ious #eliefs people, li%e the 4artyrs,
#eca4e resi7ned to the inevita#le and accepted cheerfully even the 4ost painful and e=cruciatin7 pains.
.ecause of differences in reli7ious #eliefs, the 3orld has 3itnessed tur4oil, civil strife, persecution,
hatred, #loodshed and 3ar, 7enerated to a lar7e e=tent #y 4e4#ers of sects 3ho 3ere intolerant of other
reli7ious #eliefs. The classification, introduced #y Repu#lic ct /o. &&5*, therefore, rests on su#stantial
distinctions.
The classification introduced #y said ct is also 7er4ane to its purpose. The purpose of the la3 is
precisely to avoid those 3ho cannot, #ecause of their reli7ious #elief, ,oin la#or unions, fro4 #ein7
deprived of their ri7ht to 3or% and fro4 #ein7 dis4issed fro4 their 3or% #ecause of union shop
security a7ree4ents.
Repu#lic ct /o. &&5*, further4ore, is not li4ited in its application to conditions e=istin7 at the ti4e
of its enact4ent. The la3 does not provide that it is to #e effective for a certain period of ti4e only. It
is intended to apply for all ti4es as lon7 as the conditions to 3hich the la3 is applica#le e=ist. s
lon7 as there are closed shop a7ree4ents #et3een an e4ployer and a la#or union, and there are
e4ployees 3ho are prohi#ited #y their reli7ion fro4 affiliatin7 3ith la#or unions, their e=e4ption fro4
the covera7e of said a7ree4ents continues.
+inally, the ct applies e@ually to all 4e4#ers of said reli7ious sects; this is evident fro4 its
provision. The fact that the la3 7rants a privile7e to 4e4#ers of said reli7ious sects cannot #y itself
render the ct unconstitutional, for as Ce have adverted to, the ct only restores to the4 their
freedo4 of association 3hich closed shop a7ree4ents have ta%en a3ay, and puts the4 in the sa4e
plane as the other 3or%ers 3ho are not prohi#ited #y their reli7ion fro4 ,oinin7 la#or unions. The
circu4stance, that the other e4ployees, #ecause they are differently situated, are not 7ranted the
sa4e privile7e, does not render the la3 unconstitutional, for every classification allo3ed #y the
Constitution #y its nature involves ine@uality.
The 4ere fact that the le7islative classification 4ay result in actual ine@uality is not violative of the
ri7ht to e@ual protection, for every classification of persons or thin7s for re7ulation #y la3 produces
ine@uality in so4e de7ree, #ut the la3 is not there#y rendered invalid. classification other3ise
reasona#le does not offend the constitution si4ply #ecause in practice it results in so4e
ine@uality.
*1
nent this 4atter, it has #een said that 3henever it is apparent fro4 the scope of the la3
that its o#,ect is for the #enefit of the pu#lic and the 4eans #y 3hich the #enefit is to #e o#tained are of
pu#lic character, the la3 3ill #e upheld even thou7h incidental advanta7e 4ay occur to individuals #eyond
those en,oyed #y the 7eneral pu#lic.
*2
6. ppellantHs further contention that Repu#lic ct /o. &&5* violates the constitutional provision on
social ,ustice is also #aseless. Social ,ustice is intended to pro4ote the 3elfare of all the
people.
*3
Repu#lic ct /o. &&5* pro4otes that 3elfare insofar as it loo%s after the 3elfare of those 3ho,
#ecause of their reli7ious #elief, cannot ,oin la#or unions; the ct prevents their #ein7 deprived of 3or%
and of the 4eans of livelihood. In deter4inin7 3hether any particular 4easure is for pu#lic advanta7e, it is
not necessary that the entire state #e directly #enefited B it is sufficient that a portion of the state #e
#enefited there#y.
Social ,ustice also 4eans the adoption #y the 9overn4ent of 4easures calculated to insure
econo4ic sta#ility of all co4ponent ele4ents of society, throu7h the 4aintenance of a proper
econo4ic and social e@uili#riu4 in the inter(relations of the 4e4#ers of the co44unity.
*)
Repu#lic
ct /o. &&5* insures econo4ic sta#ility to the 4e4#ers of a reli7ious sect, li%e the I7lesia ni Cristo, 3ho
are also co4ponent ele4ents of society, for it insures security in their e4ploy4ent, not3ithstandin7 their
failure to ,oin a la#or union havin7 a closed shop a7ree4ent 3ith the e4ployer. The ct also advances the
proper econo4ic and social e@uili#riu4 #et3een la#or unions and e4ployees 3ho cannot ,oin la#or
unions, for it e=e4pts the latter fro4 the co4pellin7 necessity of ,oinin7 la#or unions that have closed
shop a7ree4ents and e@uali6es, in so far as opportunity to 3or% is concerned, those 3hose reli7ion
prohi#its 4e4#ership in la#or unions 3ith those 3hose reli7ion does not prohi#it said 4e4#ership. Social
,ustice does not i4ply social e@uality, #ecause social ine@uality 3ill al3ays e=ist as lon7 as social relations
depend on personal or su#,ective proclivities. Social ,ustice does not re@uire le7al e@uality #ecause le7al
e@uality, #ein7 a relative ter4, is necessarily pre4ised on differentiations #ased on personal or natural
conditions.
*(
Social ,ustice 7uarantees e@uality of opportunity
**
, and this is precisely 3hat Repu#lic ct
/o. &&5* proposes to acco4plish B it 7ives la#orers, irrespective of their reli7ious scrupples, e@ual
opportunity for 3or%.
A. s its last 7round, appellant contends that the a4end4ent introduced #y Repu#lic ct /o. &&5* is
not called for B in other 3ords, the ct is not proper, necessary or desira#le. nent this 4atter, it has
#een held that a statute 3hich is not necessary is not, for that reason, unconstitutional; that in
deter4inin7 the constitutional validity of le7islation, the courts are unconcerned 3ith issues as to the
necessity for the enact4ent of the le7islation in @uestion.
*7
Courts do in@uire into the 3isdo4 of
la3s.
*8
5oreover, le7islatures, #ein7 chosen #y the people, are presu4ed to understand and correctly
appreciate the needs of the people, and it 4ay chan7e the la3s accordin7ly.
*9
The fear is entertained #y
appellant that unless the ct is declared unconstitutional, e4ployers 3ill prefer e4ployin7 4e4#ers of
reli7ious sects that prohi#it their 4e4#ers fro4 ,oinin7 la#or unions, and thus #e a fatal #lo3 to unionis4.
Ce do not a7ree. The threat to unionis4 3ill depend on the nu4#er of e4ployees 3ho are 4e4#ers of
the reli7ious sects that control the de4ands of the la#or 4ar%et. .ut there is really no occasion no3 to 7o
further and anticipate pro#le4s Ce cannot ,ud7e 3ith the 4aterial no3 #efore Is. t any rate, the validity
of a statute is to #e deter4ined fro4 its 7eneral purpose and its efficacy to acco4plish the end desired,
not fro4 its effects on a particular case.
75
The essential #asis for the e=ercise of po3er, and not a 4ere
incidental result arisin7 fro4 its e=ertion, is the criterion #y 3hich the validity of a statute is to #e
4easured.
71
II. Ce no3 pass on the second assi7n4ent of error, in support of 3hich the Inion ar7ued that the
decision of the trial court orderin7 the Inion to pay P5** for attorneyHs fees directly contravenes
Section 1) of Repu#lic ct /o. 'A5, for the instant action involves an industrial dispute 3herein the
Inion 3as a party, and said Inion 4erely acted in the e=ercise of its ri7hts under the union shop
provision of its e=istin7 collective #ar7ainin7 contract 3ith the Co4pany; that said order also
contravenes rticle 11*' of the Civil Code; that, further4ore, ppellee 3as never actually dis4issed
#y the defendant Co4pany and did not therefore suffer any da4a7e at all .
72
In refutin7 appellant InionHs ar7u4ents, ppellee clai4ed that in the instant case there 3as really no
industrial dispute involved in the atte4pt to co4pel ppellee to 4aintain its 4e4#ership in the union
under pain of dis4issal, and that the Inion, #y its act, inflicted intentional har4 on ppellee; that
since ppellee 3as co4pelled to institute an action to protect his ri7ht to 3or%, appellant could
le7ally #e ordered to pay attorneyHs fees under rticles 0A*) and 11*' of the Civil Code.
73
The second para7raph of Section 1) of Repu#lic ct /o. 'A5 3hich is relied upon #y appellant
provides that8
/o suit, action or other proceedin7s shall #e 4aintaina#le in any court a7ainst a
la#or or7ani6ation or any officer or 4e4#er thereof for any act done #y or on #ehalf
of such or7ani6ation in urt(erance o an in)ustrial )ispute to 3hich it is a party, on
the 7round only that such act induces so4e other person to #rea% a contract of
e4ploy4ent or that it is in restraint of trade or interferes 3ith the trade, #usiness or
e4ploy4ent of so4e other person or 3ith the ri7ht of so4e other person to dispose
of his capital or la#or. (E4phasis supplied$
That there 3as a la#or dispute in the instant case cannot #e disputed for appellant sou7ht the
dischar7e of respondent #y virtue of the closed shop a7ree4ent and under Section 1 (,$ of Repu#lic
ct /o. 'A5 a @uestion involvin7 tenure of e4ploy4ent is included in the ter4 ?la#or dispute?.
7)
The
dischar7e or the act of see%in7 it is the la#or dispute itself. It #ein7 the la#or dispute itself, that very sa4e
act of the Inion in as%in7 the e4ployer to dis4iss ppellee cannot #e ?an act done ... in urt(erance o an
in)ustrial )ispute1. The 4ere fact that appellant is a la#or union does not necessarily 4ean that all its acts
are in furtherance of an industrial dispute.
7(
ppellant Inion, therefore, cannot invo%e in its favor Section
1) of Repu#lic ct /o. 'A5. This case is not intert3ined 3ith any unfair la#or practice case e=istin7 at the
ti4e 3hen ppellee filed his co4plaint #efore the lo3er court.
/either does rticle 11*' of the Civil Code, invo%ed #y the Inion, serve as its shield. The article
provides that attorneyHs fees and e=penses of liti7ation 4ay #e a3arded ?3hen the defendantHs act
or o4ission has co4pelled the plaintiff ... to incur e2penses to protect (is interest?; and ?in any other
case 3here the court dee4s it ,ust and e@uita#le that attorneyHs fees and e=penses of liti7ation
should #e recovered?. In the instant case, it cannot #e 7ainsaid that appellant InionHs act in
de4andin7 ppelleeHs dis4issal caused ppellee to incur e=penses to prevent his #ein7 dis4issed
fro4 his ,o#. Costs accordin7 to Section 0, Rule 0)1, of the Rules of Court, shall #e allo3ed as a
4atter of course to the prevailin7 party.
CDERE+"RE, the instant appeal is dis4issed, and the decision, dated u7ust 16, 0265, of the
Court of +irst Instance of 5anila, in its Civil Case /o. 5''2), appealed fro4 is affir4ed, 3ith costs
a7ainst appellant Inion. It is so ordered.
3a$alintal, C.*, Castro, "ee(an$ee, Barre)o, 3a$asiar, Antonio, Esguerra, 3u4o, Palma an)
A0uino, **., concur.



S'+a/a,' O+6"6o"&

FERNAN!O, J, concurrin78
The decision arrived at unani4ously #y this Court that Repu#lic ct /o. &&5* is free fro4 the
constitutional infir4ities i4puted to it 3as de4onstrated in a 4anner 3ellni7h conclusive in the
learned, scholarly, and co4prehensive opinion so typical of the efforts of the ponente, Justice
Kaldivar. !i%e the rest of 4y #rethren, I concur fully. Considerin7 4oreover, the detailed attention
paid to each and every o#,ection raised as to its validity and the clarity and persuasiveness 3ith
3hich it 3as sho3n to #e devoid of support in authoritative doctrines, it 3ould appear that the last
3ord has #een 3ritten on this particular su#,ect. /onetheless, I dee4 it proper to su#4it this #rief
e=pression of 4y vie3s on the transcendent character of reli7ious freedo4
1
and its pri4acy even as
a7ainst the clai4s of protection to la#or,
2
also one of the funda4ental principles of the Constitution.
0. Reli7ious freedo4 is identified 3ith the li#erty every individual possesses to 3orship or not a
Supre4e .ein7, and if a devotee of any sect, to act in accordance 3ith its creed. Thus is
constitutionally safe7uarded, accordin7 to Justice !aurel, that ?profession of faith to an active po3er
that #inds and elevates 4an to his Creator ....?
3
The choice of 3hat a 4an 3ishes to #elieve in is his
and his alone. That is a do4ain left untouched, 3here intrusion is not allo3ed, a citadel to 3hich the la3 is
denied entry, 3hatever #e his thou7hts or hopes. In that sphere, 3hat he 3ills rei7ns supre4e. The
doctrine to 3hich he pays fealty 4ay for so4e #e unsupported #y evidence, devoid of rational foundation.
/o 4atter. There is no re@uire4ent as to its confor4ity to 3hat has found acceptance. It suffices that for
hi4 such a concept holds undisputed s3ay. That is a reco7nition of 4anHs freedo4. That for hi4 is one of
the 3ays of self( reali6ation. It 3ould #e to disre7ard the di7nity that attaches to every hu4an #ein7 to
deprive hi4 of such an attri#ute. The ?fi=ed star on our constitutional constellation,? to #orro3 the
felicitous phrase of Justice Jac%son, is that no official, not e=cludin7 the hi7hest, has it in his po3er to
prescri#e 3hat shall #e orthodo= in 4atters of conscience B or to 4undane affairs, for that 4atter.
-erona v. .ecretar! o E)ucation ) spea%s si4ilarly. In the lan7ua7e of its ponente, Justice 5onte4ayor8 ?The real4 of #elief
and creed is infinite and li4itless #ounded only #y oneHs i4a7ination and thou7ht. So is the freedo4 of #elief, includin7 reli7ious #elief,
li4itless and 3ithout #ounds. "ne 4ay #elieve in 4ost anythin7, ho3ever stran7e, #i6arre and unreasona#le the sa4e 4ay appear to
others, even heretical 3hen 3ei7hed in the scales of orthodo=y or doctrinal standards.?
(
There 3as this @ualification thou7h8
?.ut #et3een the freedo4 of #elief and the e=ercise of said #elief, there is @uite a stretch of road to travel.
If the e=ercise of said reli7ious #elief clashes 3ith the esta#lished institutions of society and 3ith the la3,
then the for4er 4ust yield and 7ive 3ay to the latter. The 9overn4ent steps in and either restrains said
e=ercise or even prosecutes the one e=ercisin7 it.?
*
It 3as on that #asis that the daily co4pulsory fla7
cere4ony in accordance 3ith a statute
7
3as found free fro4 the constitutional o#,ection on the part of a
reli7ious sect, the JehovahHs Citnesses, 3hose 4e4#ers alle7ed that their participation 3ould #e
offensive to their reli7ious #eliefs. In a case not dissi4ilar, 5est 6irginia .tate Boar) o E)ucation v.
Barnette,
8
the 4erican Supre4e Court reached a contrary conclusion. Justice Jac%sonHs elo@uent
opinion is, for this 3riter, hi7hly persuasive. Thus8 ?The case is 4ade difficult not #ecause the principles of
its decision are o#scure #ut #ecause the fla7 involved is our o3n. /evertheless, 3e apply the li4itations
of the Constitution 3ith no fear that freedo4 to #e intellectually and spiritually diverse or even contrary 3ill
disinte7rate the social or7ani6ation. To #elieve that patriotis4 3ill not flourish if patriotic cere4onies are
voluntary and spontaneous instead of a co4pulsory routine is to 4a%e an unflatterin7 esti4ate of the
appeal of our institutions to free 4inds. Ce can have intellectual individualis4 and the rich cultural
diversities that 3e o3e to e=ceptional 4inds only at the price of occasional eccentricity and a#nor4al
attitudes. Chen they are so har4less to others or to the State as those 3e deal 3ith here, the price is not
too 7reat. .ut freedo4 to differ is not li4ited to thin7s that do not 4atter 4uch. That 3ould #e a 4ere
shado3 of freedo4. The test of its su#stance is the ri7ht to differ as to thin7s that touch the heart of the
e=istin7 order.?
9
There is 4oreover this rin7in7 affir4ation #y Chief Justice Du7hes of the pri4acy of reli7ious
freedo4 in the foru4 of conscience even as a7ainst the co44and of the State itself8 ?5uch has
#een said of the para4ount duty to the state, a duty to #e reco7ni6ed, it is ur7ed, even thou7h it
conflicts 3ith convictions of duty to 9od. Indou#tedly that duty to the state e=ists 3ithin the do4ain
of po3er, for 7overn4ent 4ay enforce o#edience to la3s re7ardless of scruples. Chen oneHs #elief
collides 3ith the po3er of the state, the latter is supre4e 3ithin its sphere and su#4ission or
punish4ent follo3s. .ut, in the foru4 of conscience, duty to a 4oral po3er hi7her than the state has
al3ays #een 4aintained. The reservation of that supre4e o#li7ation, as a 4atter of principle, 3ould
un@uestiona#ly #e 4ade #y 4any of our conscientious and la3(a#idin7 citi6ens. The essence of
reli7ion is #elief in a relation to 9od involvin7 duties superior to those arisin7 fro4 any hu4an
relation.?
15
The 4erican Chief Justice spo%e in dissent, it is true, #ut 3ith hi4 in a7ree4ent 3ere three
of the fore4ost ,urists 3ho ever sat in that Tri#unal, Justices Dol4es, .randeis, and Stone.
1. s I vie3 Justice KaldivarHs opinion in that li7ht, 4y concurrence, as set forth earlier, is
3holehearted and entire. Cith such a cardinal postulate as the #asis of our polity, it has a 4essa7e
that cannot #e 4isread. Thus is intoned 3ith a rever#eratin7 clan7, to paraphrase Cardo6o, a
funda4ental principle that dro3ns all 3ea%er sounds. The la#ored effort to cast dou#t on the validity
of the statutory provision in @uestion is far fro4 persuasive. It is attended #y futility. It is not for this
Court, as I conceive of the ,udicial function, to restrict the scope of a preferred freedo4.
&. There is, ho3ever, the @uestion of 3hether such an e=ception possesses an i4plication that
lessens the effectiveness of state efforts to protect la#or, li%e3ise, as noted, constitutionally
ordained. Such a vie3, on the surface, 4ay not #e lac%in7 in plausi#ility, #ut upon closer analysis, it
cannot stand scrutiny. Thou7ht 4ust #e 7iven to the freedo4 of association, li%e3ise an aspect of
intellectual li#erty. +or the late Professor Do3e a constitutionalist and in his lifeti4e the #io7rapher of
the 7reat Dol4es, it even parta%es of the political theory of pluralistic soverei7nty. So 7reat is the
respect for the autono4y accorded voluntary societies.
11
Such a ri7ht i4plies at the very least that one
can deter4ine for hi4self 3hether or not he should ,oin or refrain fro4 ,oinin7 a la#or or7ani6ation, an
institutional device for pro4otin7 the 3elfare of the 3or%in7 4an. closed shop, on the other hand, is
inherently coercive. That is 3hy, as is un4ista%a#ly reflected in our decisions, the latest of 3hich
is -ui#arno v. Court o In)ustrial Relations,
12
it is far fro4 #ein7 a favorite of the la3. +or a statutory
provision then to further curtail its operation, is precisely to follo3 the dictates of sound pu#lic policy.
The e=haustive and 3ell(researched opinion of Justice Kaldivar thus is in the 4ainstrea4 of
constitutional tradition. That, for 4e, is the channel to follo3.


S'+a/a,' O+6"6o"&
FERNAN!O, J, concurrin78
The decision arrived at unani4ously #y this Court that Repu#lic ct /o. &&5* is free fro4 the
constitutional infir4ities i4puted to it 3as de4onstrated in a 4anner 3ellni7h conclusive in the
learned, scholarly, and co4prehensive opinion so typical of the efforts of the ponente, Justice
Kaldivar. !i%e the rest of 4y #rethren, I concur fully. Considerin7 4oreover, the detailed attention
paid to each and every o#,ection raised as to its validity and the clarity and persuasiveness 3ith
3hich it 3as sho3n to #e devoid of support in authoritative doctrines, it 3ould appear that the last
3ord has #een 3ritten on this particular su#,ect. /onetheless, I dee4 it proper to su#4it this #rief
e=pression of 4y vie3s on the transcendent character of reli7ious freedo4
1
and its pri4acy even as
a7ainst the clai4s of protection to la#or,
2
also one of the funda4ental principles of the Constitution.
0. Reli7ious freedo4 is identified 3ith the li#erty every individual possesses to 3orship or not a
Supre4e .ein7, and if a devotee of any sect, to act in accordance 3ith its creed. Thus is
constitutionally safe7uarded, accordin7 to Justice !aurel, that ?profession of faith to an active po3er
that #inds and elevates 4an to his Creator ....?
3
The choice of 3hat a 4an 3ishes to #elieve in is his
and his alone. That is a do4ain left untouched, 3here intrusion is not allo3ed, a citadel to 3hich the la3 is
denied entry, 3hatever #e his thou7hts or hopes. In that sphere, 3hat he 3ills rei7ns supre4e. The
doctrine to 3hich he pays fealty 4ay for so4e #e unsupported #y evidence, devoid of rational foundation.
/o 4atter. There is no re@uire4ent as to its confor4ity to 3hat has found acceptance. It suffices that for
hi4 such a concept holds undisputed s3ay. That is a reco7nition of 4anHs freedo4. That for hi4 is one of
the 3ays of self( reali6ation. It 3ould #e to disre7ard the di7nity that attaches to every hu4an #ein7 to
deprive hi4 of such an attri#ute. The ?fi=ed star on our constitutional constellation,? to #orro3 the
felicitous phrase of Justice Jac%son, is that no official, not e=cludin7 the hi7hest, has it in his po3er to
prescri#e 3hat shall #e orthodo= in 4atters of conscience B or to 4undane affairs, for that 4atter.
-erona v. .ecretar! o E)ucation ) spea%s si4ilarly. In the lan7ua7e of its ponente, Justice 5onte4ayor8 ?The real4 of #elief
and creed is infinite and li4itless #ounded only #y oneHs i4a7ination and thou7ht. So is the freedo4 of #elief, includin7 reli7ious #elief,
li4itless and 3ithout #ounds. "ne 4ay #elieve in 4ost anythin7, ho3ever stran7e, #i6arre and unreasona#le the sa4e 4ay appear to
others, even heretical 3hen 3ei7hed in the scales of orthodo=y or doctrinal standards.?
(
There 3as this @ualification thou7h8
?.ut #et3een the freedo4 of #elief and the e=ercise of said #elief, there is @uite a stretch of road to travel.
If the e=ercise of said reli7ious #elief clashes 3ith the esta#lished institutions of society and 3ith the la3,
then the for4er 4ust yield and 7ive 3ay to the latter. The 9overn4ent steps in and either restrains said
e=ercise or even prosecutes the one e=ercisin7 it.?
*
It 3as on that #asis that the daily co4pulsory fla7
cere4ony in accordance 3ith a statute
7
3as found free fro4 the constitutional o#,ection on the part of a
reli7ious sect, the JehovahHs Citnesses, 3hose 4e4#ers alle7ed that their participation 3ould #e
offensive to their reli7ious #eliefs. In a case not dissi4ilar, 5est 6irginia .tate Boar) o E)ucation v.
Barnette,
8
the 4erican Supre4e Court reached a contrary conclusion. Justice Jac%sonHs elo@uent
opinion is, for this 3riter, hi7hly persuasive. Thus8 ?The case is 4ade difficult not #ecause the principles of
its decision are o#scure #ut #ecause the fla7 involved is our o3n. /evertheless, 3e apply the li4itations
of the Constitution 3ith no fear that freedo4 to #e intellectually and spiritually diverse or even contrary 3ill
disinte7rate the social or7ani6ation. To #elieve that patriotis4 3ill not flourish if patriotic cere4onies are
voluntary and spontaneous instead of a co4pulsory routine is to 4a%e an unflatterin7 esti4ate of the
appeal of our institutions to free 4inds. Ce can have intellectual individualis4 and the rich cultural
diversities that 3e o3e to e=ceptional 4inds only at the price of occasional eccentricity and a#nor4al
attitudes. Chen they are so har4less to others or to the State as those 3e deal 3ith here, the price is not
too 7reat. .ut freedo4 to differ is not li4ited to thin7s that do not 4atter 4uch. That 3ould #e a 4ere
shado3 of freedo4. The test of its su#stance is the ri7ht to differ as to thin7s that touch the heart of the
e=istin7 order.?
9
There is 4oreover this rin7in7 affir4ation #y Chief Justice Du7hes of the pri4acy of reli7ious
freedo4 in the foru4 of conscience even as a7ainst the co44and of the State itself8 ?5uch has
#een said of the para4ount duty to the state, a duty to #e reco7ni6ed, it is ur7ed, even thou7h it
conflicts 3ith convictions of duty to 9od. Indou#tedly that duty to the state e=ists 3ithin the do4ain
of po3er, for 7overn4ent 4ay enforce o#edience to la3s re7ardless of scruples. Chen oneHs #elief
collides 3ith the po3er of the state, the latter is supre4e 3ithin its sphere and su#4ission or
punish4ent follo3s. .ut, in the foru4 of conscience, duty to a 4oral po3er hi7her than the state has
al3ays #een 4aintained. The reservation of that supre4e o#li7ation, as a 4atter of principle, 3ould
un@uestiona#ly #e 4ade #y 4any of our conscientious and la3(a#idin7 citi6ens. The essence of
reli7ion is #elief in a relation to 9od involvin7 duties superior to those arisin7 fro4 any hu4an
relation.?
15
The 4erican Chief Justice spo%e in dissent, it is true, #ut 3ith hi4 in a7ree4ent 3ere three
of the fore4ost ,urists 3ho ever sat in that Tri#unal, Justices Dol4es, .randeis, and Stone.
1. s I vie3 Justice KaldivarHs opinion in that li7ht, 4y concurrence, as set forth earlier, is
3holehearted and entire. Cith such a cardinal postulate as the #asis of our polity, it has a 4essa7e
that cannot #e 4isread. Thus is intoned 3ith a rever#eratin7 clan7, to paraphrase Cardo6o, a
funda4ental principle that dro3ns all 3ea%er sounds. The la#ored effort to cast dou#t on the validity
of the statutory provision in @uestion is far fro4 persuasive. It is attended #y futility. It is not for this
Court, as I conceive of the ,udicial function, to restrict the scope of a preferred freedo4.
&. There is, ho3ever, the @uestion of 3hether such an e=ception possesses an i4plication that
lessens the effectiveness of state efforts to protect la#or, li%e3ise, as noted, constitutionally
ordained. Such a vie3, on the surface, 4ay not #e lac%in7 in plausi#ility, #ut upon closer analysis, it
cannot stand scrutiny. Thou7ht 4ust #e 7iven to the freedo4 of association, li%e3ise an aspect of
intellectual li#erty. +or the late Professor Do3e a constitutionalist and in his lifeti4e the #io7rapher of
the 7reat Dol4es, it even parta%es of the political theory of pluralistic soverei7nty. So 7reat is the
respect for the autono4y accorded voluntary societies.
11
Such a ri7ht i4plies at the very least that one
can deter4ine for hi4self 3hether or not he should ,oin or refrain fro4 ,oinin7 a la#or or7ani6ation, an
institutional device for pro4otin7 the 3elfare of the 3or%in7 4an. closed shop, on the other hand, is
inherently coercive. That is 3hy, as is un4ista%a#ly reflected in our decisions, the latest of 3hich
is -ui#arno v. Court o In)ustrial Relations,
12
it is far fro4 #ein7 a favorite of the la3. +or a statutory
provision then to further curtail its operation, is precisely to follo3 the dictates of sound pu#lic policy.
The e=haustive and 3ell(researched opinion of Justice Kaldivar thus is in the 4ainstrea4 of
constitutional tradition. That, for 4e, is the channel to follo3.
Ca&' No. )
G.R. No. 8291) J7"' 25, 1988
$APATIRAN SA MEAT AN! CANNING !IVISION (T3PAS Lo8a9 C:a+,'/ No. 1527), petitioner,
vs.
T;E ;ONORALE LR !IRECTOR P3RA FERRER CALLEJA, MEAT AN! CANNING !IVISION
3NIVERSAL ROINA CORPORATION a"# MEAT AN! CANNING !IVISION NE1 EMPLOYEES
AN! 1OR$ERS 3NITE! LAOR ORGANI0ATION, respondents.
Alar, Comia, 3analo an) Associates or petitioner.
%anilo Bolos or respon)ent Robina Corporation.
R E S " ! I T I " /

GRI<O%A=3INO, J.:
The petitioner, :apatiran sa 5eat and Cannin7 -ivision TIPS !ocal Chapter /o. 0*1A$ hereinafter
referred to as ?TIPS,? see%s a revie3 of the resolution dated January 1A, 02'' (nne= -$ of pu#lic
respondent Pura +errer(Calle,a, -irector of the .ureau of !a#or Relations, dis4issin7 its appeal
fro4 the "rder dated /ove4#er 0A, 02'A (nne= C$ of the 5ed(r#iter Rasidali C. #dullah
orderin7 a certification election to #e conducted a4on7 the re7ular daily paid ran% and file
e4ployees>3or%ers of Iniversal Ro#ina Corporation(5eat and Cannin7 -ivision to deter4ine 3hich
of the contendin7 unions8
a$ :apatiran sa 5eat and Cannin7 -ivision TIPS !ocal Chapter /o. 0*1A (or
?TIPS? for #revity$;
#$ 5eat and Cannin7 -ivision /e3 E4ployees and Cor%ers Inited !a#or
"r7ani6ation (or ?/EC I!"? for #revity$;
c$ /o union.
shall #e the #ar7ainin7 unit of the daily 3a7e ran% and file e4ployees in the 5eat and Cannin7
-ivision of the co4pany.
+ro4 02') to 02'A TIPS 3as the sole and e=clusive collective #ar7ainin7 representative of the
3or%ers in the 5eat and Cannin7 -ivision of the Iniversal Ro#ina Corporation, 3ith a &(year
collective #ar7ainin7 a7ree4ent (C.$ 3hich 3as to e=pire on /ove4#er 05, 02'A.
Cithin the freedo4 period of 6* days prior to the e=piration of its C., TIPS filed an a4ended
notice of stri%e on Septe4#er 1', 02'A as a 4eans of pressurin7 the co4pany to e=tend, rene3, or
ne7otiate a ne3 C. 3ith it.
"n "cto#er ', 02'A, the /EC I!", co4posed 4ostly of 3or%ers #elon7in7 to the I9!ESI /I
:RIST" sect, re7istered as a la#or union.
"n "cto#er 01, 02'A, the TIPS sta7ed a stri%e. R".I/ o#tained an in,unction a7ainst the stri%e,
resultin7 in an a7ree4ent to return to 3or% and for the parties to ne7otiate a ne3 C..
The ne=t day, "cto#er 0&, 02'A, /EC I!", clai4in7 that it has ?the 4a,ority of the daily 3a7e ran%
and file e4ployees nu4#erin7 020,? filed a petition for a certification election at the .ureau of !a#or
Relations (nne= $.
TIPS 4oved to dis4iss the petition for #ein7 defective in for4 and that the 4e4#ers of the /EC
I!" 3ere 4ostly 4e4#ers of the I7lesia ni :risto sect 3hich three (&$ years previous refused to
affiliate 3ith any la#or union. It also accused the co4pany of usin7 the /EC I!" to defeat TIPSH
#ar7ainin7 ri7hts (nne= .$.
"n /ove4#er 0A, 02'A, the 5ed(r#iter ordered the holdin7 of a certification election 3ithin 1* days
(nne= C$.
TIPS appealed to the .ureau of !a#or Relations .!R. In the 4eanti4e, it 3as a#le to ne7otiate a
ne3 &(year C. 3ith R".I/, 3hich 3as si7ned on -ece4#er &, 02'A and to e=pire on /ove4#er
05, 022*.
"n January 1A, 02'', respondent .!R -irector Calle,a dis4issed the appeal (nne= -$.
TIPSH 4otion for reconsideration (nne= E$ 3as denied on 5arch 0A, 02'' (nne= +$. "n pril &*,
02'', it filed this petition alle7in7 that the pu#lic respondent acted in e=cess of her ,urisdiction and
3ith 7rave a#use of discretion in affir4in7 the 5ed(r#iterHs order for a certification election.
fter deli#eratin7 on the petition and the docu4ents anne=ed thereto, Ce find no 4erit in the
Petition. The pu#lic respondent did not err in dis4issin7 the petitionerHs appeal in .!R Case /o. (
01(&'2('A. This CourtHs decision in6ictoriano vs. Eli,al)e Rope 5or$ers7 Union, 52 SCR 5),
upholdin7 the ri7ht of 4e4#ers of the I9!ESI /I :RIST" sect not to ,oin a la#or union for #ein7
contrary to their reli7ious #eliefs, does not #ar the 4e4#ers of that sect fro4 for4in7 their o3n
union. The pu#lic respondent correctly o#served that the ?reco7nition of the tenets of the sect ...
should not infrin7e on the #asic ri7ht of self(or7ani6ation 7ranted #y the constitution to 3or%ers,
re7ardless of reli7ious affiliation.?
The fact that TIPS 3as a#le to ne7otiate a ne3 C. 3ith R".I/ 3ithin the 6*(day freedo4
period of the e=istin7 C., does not foreclose the ri7ht of the rival union, /EC I!", to challen7e
TIPSH clai4 to 4a,ority status, #y filin7 a ti4ely petition for certification election on "cto#er 0&,
02'A #efore TIPSH old C. e=pired on /ove4#er 05, 02'A and #efore it si7ned a ne3 C. 3ith
the co4pany on -ece4#er &, 02'A. s pointed out #y 5ed(r#iter #dullah, a ?certification election
is the #est foru4 in ascertainin7 the 4a,ority status of the contendin7 unions 3herein the 3or%ers
the4selves can freely choose their #ar7ainin7 representative thru secret #allot.? Since it has not
#een sho3n that this order is tainted 3ith unfairness, this Court 3ill not th3art the holdin7 of a
certification election (ssociated Trade Inions LTIM vs. /oriel, '' SCR 26$.
CDERE+"RE, the petition for certiorari is denied, 3ith costs a7ainst the petitioner.
S" "R-ERE-.
Case No. -
G.R. No&. )3*33%3) S'+,'-.'/ 1), 1995
PALO ARI0ALA, SERGIO MARIAO, LEONAR!O JOVEN, a"# FELINO
3LAN!3S, petitioners,
vs.
T;E CO3RT OF APPEALS a"# T;E PEOPLE OF T;E P;ILIPPINES, respondents.
*anuario ". .eno or petitioners.
NARVASA, J.:
Inder the Industrial Peace ct,
1
7overn4ent(o3ned or controlled corporations had the duty to #ar7ain
collectively and 3ere other3ise su#,ect to the o#li7ations and duties of e4ployers in the private
sector.
2
The ct also prohi#ited supervisors to #eco4e, or continue to #e, 4e4#ers of la#or or7ani6ations
co4posed of ran%(and(file e4ployees,
3
and prescri#ed cri4inal sanctions for #reach of the prohi#ition.
)
It 3as under the re7i4e of said Industrial Peace ct that the 9overn4ent Service Insurance Syste4
(9SIS, for short$ #eca4e #ound #y a collective #ar7ainin7 a7ree4ent e=ecuted #et3een it and the
la#or or7ani6ation representin7 the 4a,ority of its e4ployees, the 9SIS E4ployees ssociation. The
a7ree4ent contained a ?4aintenance(of(4e4#ership? clause,
(
i.e., that all e4ployees 3ho, at the
ti4e of the e=ecution of said a7ree4ent, 3ere 4e4#ers of the union or #eca4e 4e4#ers thereafter,
3ere o#li7ed to 4aintain their union 4e4#ership in 7ood standin7 for the duration of the a7ree4ent as a
condition for their continued e4ploy4ent in the 9SIS.
There appears to #e no dispute that at that ti4e, the petitioners occupied supervisory positions in the
9SIS. Pa#lo ri6ala and Ser7io 5ari#ao 3ere, respectively, the Chief of the ccountin7 -ivision, and
the Chief of the .illin7 Section of said -ivision, in the Central Gisayas Re7ional "ffice of the 9SIS.
!eonardo Joven and +elino .ulandus 3ere, respectively, the ssistant Chief of the ccountin7
-ivision (so4eti4es ctin7 Chief in the a#sence of the Chief$ and the ssistant Chief of the +ield
Service and /on(!ife Insurance -ivision (and ctin7 -ivision Chief in the a#sence of the Chief$, of
the sa4e Central Gisayas Re7ional "ffice of the 9SIS. -e4ands 3ere 4ade on all four of the4 to
resi7n fro4 the 9SIS E4ployees ssociation, in vie3 of their supervisory positions. They refused to
do so. Conse@uently, t3o (1$ cri4inal cases for violation of the Industrial Peace ct 3ere lod7ed
a7ainst the4 in the City Court of Ce#u8 one involvin7 ri6ala and 5ari#ao
*
and the other, Joven and
.ulandus.
7
.oth cri4inal actions resulted in the conviction of the accused in separate decisions.
8
They 3ere
each sentenced ?to pay a fine of P 5**.** or to suffer su#sidiary i4prison4ent in case of insolvency.?
They appealed to the Court of ppeals.
9
ri6alaHs and 5ari#aoHs appeal 3as doc%eted as C(9.R. /o.
0)A1)(CR; that of Joven and .ulandus, as C(9.R. /o. 0)'56(CR.
The appeals 3ere consolidated on 4otion of the appellants, and eventuated in a ,ud74ent
pro4ul7ated on January 12, 02A6 affir4in7 the convictions of all four appellants. The appellants
4oved for reconsideration. They ar7ued that 3hen the so called ?02A& Constitution? too% effect on
January 0A, 02A& pursuant to Procla4ation /o. 00*), the case of ri6ala and 5ari#ao 3as still
pendin7 in the Court of ppeals and that of Joven and .ulandus, pendin7 decision in the City Court
of Ce#u; that since the provisions of that constitution and of the !a#or Code su#se@uently
pro4ul7ated (eff., /ove4#er 0, 02A)$, repealin7 the Industrial Peace ct(placed e4ployees of all
cate7ories in 7overn4ent(o3ned or controlled corporations 3ithout distinction 3ithin the Civil
Service, and provided that the ter4s and conditions of their e4ploy4ent 3ere to #e ?7overned #y
the Civil Service !a3, rules and re7ulations? and hence, no lon7er su#,ect of collective #ar7ainin7,
the appellants ceased to fall 3ithin the covera7e of the Industrial Peace ct and should thus no
lon7er continue to #e prosecuted and e=posed to punish4ent for a violation thereof. They pointed
out further that the cri4inal sanction in the Industrial Peace ct no lon7er appeared in the !a#or
Code. The ppellate Court denied their plea for reconsideration.
Dence, the present petition for revie3 on certiorari.
The crucial issue o#viously is 3hether or not the petitionersH cri4inal lia#ility for a violation of the
Industrial Peace ct 4ay #e dee4ed to have #een o#literated in virtue of su#se@uent le7islation and
the provisions of the 02A& and 02'A Constitutions.
The petitionersH contention that their lia#ility had #een erased is 4ade to rest upon the follo3in7
pre4ises8
0. Section 0, rticle FII(. of the 02A& Constitution does indeed provide that the ?Civil Service
e4#races every #ranch, a7ency, su#division and instru4entality of the 7overn4ent, includin7
7overn4ent(o3ned or controlled corporations, .. ad4inistered #y an independent Civil Service
Co44ission.
1. rticle 121 of the !a#or Code repealed such parts and provisions of the Industrial Peace ct as
3ere ?not adopted as part? of said Code ?either directly or #y reference.? The Code did not adopt the
provision of the Industrial Peace ct conferrin7 on e4ployees of 7overn4ent(o3ned or controlled
corporations the ri7ht of self(or7ani6ation and collective #ar7ainin7; in fact it 4ade %no3n that the
?ter4s and conditions of e4ploy4ent of all 7overn4ent e4ployees, includin7 e4ployees of
7overn4ent(o3ned and controlled corporations,? 3ould thenceforth no lon7er #e fi=ed #y collective
#ar7ainin7 #ut ?#e 7overned #y the Civil Service !a3, rules and re7ulations.?
15
&. The specific penalty for violation of the prohi#ition on supervisors #ein7 4e4#ers in a la#or
or7ani6ation of e4ployees under their supervision has disappeared.
). The Code also 4odified the concept of unfair la#or practice, decreein7 that thenceforth, ?it shall
#e considered 4erely as an ad4inistrative offense rather than a cri4inal offense (and that$ (u$nfair
la#or practice co4plaints shall = = #e processed li%e any ordinary la#or disputes.?
11
"n the other hand, in ,ustification of the ppellate Tri#unalHs affir4ance of the petitionersH convictions
of violations of the Industrial Peace ct, the People(
0$ advert to the fact that said !a#or Code also states that ?all actions or clai4s accruin7 prior to ...
(its$ effectivity ... shall #e deter4ined in accordance 3ith the la3s in force at the ti4e of their
accrual;? and
1$ ar7ue that the le7islature cannot 7enerally intervene and vacate the ,ud74ent of the courts, either
directly or indirectly, #y the repeal of the statute under 3hich said ,ud74ent has #een rendered.
The le7al principles 7overnin7 the ri7hts of self(or7ani6ation and collective #ar7ainin7 of ran%(and(
file e4ployees in the 7overn4ent( particularly as re7ards supervisory, and hi7h level or 4ana7erial
e4ployees have under7one alterations throu7h the years.
Republic Act +o. 89:
s already inti4ated, under R 'A5 (the Industry Peace ct$,
12
persons ?emplo!e) in proprietar!
unctions of the 9overn4ent, includin7 #ut not li4ited to 7overn4ental corporations,? had the ri7ht of self(
or7ani6ation and collective #ar7ainin7, includin7 the ri7ht to en7a7e in concerted activities to attain their
o#,ectives, e.7. stri%es.
.ut those ?emplo!e) in governmental unctions? 3ere for#idden to ?stri%e for the purpose of securin7
chan7es or 4odification in their ter4s and conditions of e4ploy4ent? or ,oin la#or or7ani6ations
3hich i4posed on their 4e4#ers the duty to stri%e. The reason o#viously 3as that the ter4s and
conditions of their e4ploy4ent 3ere ?7overned #y la3? and hence could not #e fi=ed, altered or
other3ise 4odified #y collective #ar7ainin7.
.upervisor! emplo!ees 3ere for#idden to ,oin la#or or7ani6ations co4posed of e4ployees under
the4, #ut could for4 their o3n unions. Considered ?supervisorsH 3ere those Hhavin7 authority in the
interest of an e4ployer to hire, transfer, suspend, lay(off, recall, dischar7e, assi7n, reco44end, or
discipline other e4ployees, or responsi#ly to direct the4, and to ad,ust their 7rievance or effectively
to reco44end such acts if, in connection 3ith the fore7oin7, the e=ercise of such authority is not
4erely routinary or clerical in nature #ut re@uires the use of independent ,ud74ent.?
13
Republic Act +o. ;;<=
Si4ilar provisions 3ere found in R.. /o. 116*, the Civil Service ct of 0252. This ct declared that
the ?Philippine Civil Service ... (e4#raced$ all #ranches, su#divisions and instru4entalities of the
7overn4ent inclu)ing government-o>ne) an) controlle) corporations.?
1)
It prohi#ited such civil service e4ployees 3ho 3ere ?e4ployed in 7overn4ental functions? to #elon7
to any la#or or7ani6ation 3hich i4posed on their 4e4#ers ?the o#li7ation to stri%e or to ,oin stri%es.?
nd one of the first issuances of the President after the procla4ation of 4artial la3 in Septe4#er,
02A1, 3as 9eneral "rder /o. 5 3hich inter alia #anned stri%es in vital industries,? as 3ell as Hall
rallies, de4onstrations and other for4s of 7roup actions.?
1(
/ot so prohi#ited, ho3ever, 3ere those ?emplo!e) in proprietar! unctions of the 9overn4ent
includin7, #ut not li4ited to, 7overn4ental corporations.?
1*
The ct also penali6ed any person 3ho
?violates, refuses or ne7lects to co4ply 3ith any ... provisions (of the ct$ or rules (thereunder
pro4ul7ated$ ... #y a fine not e=ceedin7 one thousand pesos or #y i4prison4ent not e=ceedin7 si=
4onths or #oth such fine and i4prison4ent in the discretion of the court.?
17
"(e ?@9A Constitution
The 02A& Constitution laid do3n the #road principle that ?(t$he State shall assure the ri7hts of
3or%ers to self(or7ani6ation, collective #ar7ainin7, security of tenure, and ,ust and hu4ane
conditions of 3or%,?
18
and directed that the ?/ational sse4#ly shall provide for the standardi6ation of
co4pensation of 7overn4ent officials and e4ployees,inclu)ing t(ose in government-o>ne) or controlle)
corporations, ta%in7 into account the nature of the responsi#ilities pertainin7 to, and the @ualifications
re@uired for, the positions concerned.?
19
P% BB;, "(e Labor Co)e
The !a#or Code of the Philippines, Presidential -ecree /o. ))1, enacted 3ithin a year fro4
effectivity of the 02A& Constitution,
25
incorporated the proposition that the ?ter4s and conditions of
e4ploy4ent of all 7overn4ent e4ployees, includin7 e4ployees of 7overn4ent(o3ned and controlled
corporations ... (are$ 7overned #y the Civil Service !a3, rules and re7ulations.?
21
It incorporated, too, the
constitutional 4andate that the salaries of said e4ployees ?shall #e standardi6ed #y the /ational
sse4#ly.?
The !a#or Code,
22
ho3ever ?e=e4pted? 7overn4ent e4ployees fro4 the ri7ht to self(or7ani6ation for
purposes of collective #ar7ainin7. Chile the Code contained provisions ac%no3led7in7 the ri7ht of ?all
persons e4ployed in co44ercial, industrial and a7ricultural enterprises, includin7 reli7ious, 4edical or
educational institutions operatin7 for profit? to ?self(or7ani6ation and to for4, ,oin or assist la#or
or7ani6ations for purposes of collective #ar7ainin7,? they ?e2empte) rom t(e oregoing provisionsC
a$ security 7uards;
#$ government emplo!ees, inclu)ing emplo!ees o government government-o>ne) an)D or
controlle) corporationsE
c$ 4ana7erial e4ployees; and
d$ e4ployees of reli7ious, charita#le, 4edical and educational institutions not operatin7 for profit,
provided the latter do not have e=istin7 collective a7ree4ents or reco7ni6ed unions at the ti4e of the
effectivity of the code or have voluntarily 3aived their e=e4ption.?
23
The reason for denyin7 to 7overn4ent e4ployees the ri7ht to ?self(or7ani6ation and to for4, ,oin or
assist la#or or7ani6ations for purposes of collective #ar7ainin7? is presu4a#ly the sa4e as that
under the Industrial Peace ct, i.e., that the ter4s and conditions of 7overn4ent e4ploy4ent are
fi=ed #y la3 and not #y collective #ar7ainin7.
So4e inconsistency appears to have arisen #et3een the !a#or Code and the Civil Service ct of
0252. Inder the Civil Service ct, persons ?e4ployed in proprietary functions of the 7overn4ent
includin7, #ut not li4ited to, 7overn4ental corporationsH(not #ein7 3ithin ?the policy of the
9overn4ent that the e4ployees therein shall not stri%e for the purpose of securin7 chan7es in their
ter4s and conditions of e4ploy4ent?(could le7iti4ately #ar7ain 3ith their respective e4ployers
throu7h their la#or or7ani6ations, and corollarily en7a7e in stri%es and other concerted activities in
an atte4pt to #rin7 a#out chan7es in the conditions of their 3or%. They could not ho3ever do so
under the !a#or Code and its I4ple4entin7 Rules and Re7ulations; these provided that ?7overn4ent
e4ployees, includin7 e4ployees of 7overn4ent(o3ned and>or controlled corporations,? 3ithout
distinction as to function, 3ere ?e=e4pted? (e=cluded is the #etter ter4$ fro4 ?the ri7ht to self(
or7ani6ation and to for4, ,oin or assist la#or or7ani6ations for purposes of collective #ar7ainin7,? and
#y i4plication, e=cluded as 3ell fro4 the ri7ht to en7a7e in concerted activities, such as stri%es, as
coercive 4easures a7ainst their e4ployers.
3embers o supervisor! unions 3ho 3ere not 4ana7erial e4ployees, 3ere declared #y the !a#or
Code to #e ?eli7i#le to ,oin or assist the ran% and file la#or or7ani6ation, and if none e=ists, to for4 or
assist in the for4in7 of such ran% and file or7ani6ation ?
2)
5ana7erial e4ployees, on the other hand,
3ere pronounced as Hnot eli7i#le to ,oin, assist or for4 any la#or or7ani6ation.?
2(
?4ana7erial
e4ployee? 3as defined as one vested 3ith po3er or prero7atives to lay do3n and e=ecute 4ana7e4ent
policies and>or to hire, transfer, suspend, lay(off, recall, dischar7e, assi7n or discipline e4ployees, or to
effectively reco44end such 4ana7erial actions.?
2*
Presi)ential %ecree +o. 8=9
Clarification of the 4atter see4s to have #een very shortly atte4pted #y the Civil Service -ecree of
the Philippines, Presidential -ecree /o. '*A (eff., "ct. 6,02A5$ 3hich superseded the Civil Service
!a3 of 0252 (R 116*$
27
and repealed or 4odified ?all la3s, rules and re7ulations or parts thereof
inconsistent 3ith the provisions? thereof. The -ecree cate7orically descri#ed the scope and covera7e of
the ?Civil Service? as e4#racin7 )) every #ranch, a7ency, su#division, and instru4entality of the
7overn4ent, inclu)ing ever! government o>ne) or controlle) corporation >(et(er perorming
governmental or propriet! unction.
28
The effect 3as see4in7ly to prohi#it 7overn4ent e4ployees
(includin7 those ?e4ployed in proprietary functions of the 9overn4ent?$ to ?stri%e for the purpose of
securin7 chan7es of their ter4s and conditions of e4ploy4ent,?
29
so4ethin7 3hich, as aforestated, they
3ere allo3ed to do under the Civil Service ct of 0252.
35
.e this as it 4ay it see4s clear that P- '*A (the Civil Service -ecree$ did not 4odify the declared
ineli7i#ility of ?managerial emplo!ees? fro4 ,oinin7, assistin7 or for4in7 an! la#or or7ani6ation.
E2ecutive 'r)er +o. ???
E=ecutive "rder /o. 000, issued #y President Cora6on C. @uino on -ece4#er 1), 02'6 in the
e=ercise of le7islative po3ers under the +reedo4 Constitution, 4odified the 7eneral dis@ualification
a#ove 4entioned of H7overn4ent e4ployees, includin7 e4ployees of 7overn4ent(o3ned and>or
controlled corporations? fro4 ?the ri7ht to self(or7ani6ation and to for4, ,oin or assist la#or
or7ani6ations for purposes of collective #ar7ainin7.H It 7ranted to e4ployees ?of government
corporations establis(e) un)er t(e Corporation Co)e 2 2 t(e rig(t to organi,e an) to bargain
collectivel! >it( t(eir respective emplo!ers.?
31
To all Hother e4ployees in the civil service, ... (it 7ranted
4erely$ the ri7ht to for4 associations for purposes not contrary to la3,?
32
not for ?purposes of collective
#ar7ainin7.?
"(e ?@89 Constitution
The provisions of the present Constitution on the 4atter appear to #e so4e3hat 4ore e=tensive.
They declare that the ?ri7ht to self or7ani6ation shall not #e denied to 7overn4ent e4ployees;?
33
that
the State ?shall 7uarantee the ri7hts of all 3or%ers to self(or7ani6ation, collective #ar7ainin7 and
ne7otiations, and peaceful concerted activities,inclu)ing t(e rig(t to stri$e in accor)ance >it( la>;? and
that said 3or%ers ?shall #e entitled to security of tenure, hu4ane conditions of 3or%, and a livin7 3a7e, ...
(and$ also participate in policy and decision(4a%in7 processes affectin7 their ri7hts and #enefits as 4ay
#e provided #y la3.
3)
C.C 3emoran)um Circular +o. <
5e4orandu4 Circular /o. 6 of the Civil Service Co44ission, issued on pril 10, 02'A en,oined
stri%es #y 7overn4ent officials and e4ployees, to 3it8
3(
... Prior to the enact4ent #y Con7ress of applica#le la3s concernin7 stri%e #y
7overn4ent e4ployees, and considerin7 that there are e=istin7 la3s 3hich prohi#it
7overn4ent officials and e4ployees fro4 resortin7 to stri%e, the Co44ission en,oins,
under pain of ad4inistrative sanctions, all 7overn4ent officers and e4ployees fro4
sta7in7 stri%es, de4onstrations, 4ass leaves, 3al%(outs and other for4s of 4ass
action 3hich 3ill result in te4porary stoppa7e or disruption of pu#lic services. To
allo3 other3ise is to under4ine or pre,udice the 7overn4ent syste4.
E2ecutive 'r)er +o. ?8=
The scope of the constitutional ri7ht to self(or7ani6ation of ?7overn4ent e4ployees? a#ove
4entioned, 3as defined and delineated in E=ecutive "rder /o. 0'* (eff. June 0, 02'A$. ccordin7 to
this E=ecutive "rder, the ri7ht of self(or7ani6ation does indeed pertain to all ?e4ployees of all
#ranches, su#divisions, instru4entalities and a7encies of the 9overn4ent, includin7 7overn4ent(
o3ned or controlled corporations 3ith ori7inal charters;?
3*
such e4ployees ?shall not #e discri4inated
a7ainst in respect of their e4ploy4ent #y reason of their 4e4#ership in e4ployeesH or7ani6ations or
participation in the nor4al activities of their or7ani6ation = = (and their$ e4ploy4ent shall not #e su#,ect to
the condition that they shall not ,oin or shall relin@uish their 4e4#ership in the e4ployeesH
or7ani6ations.
37
Do3ever, the concept of the 7overn4ent e4ployeesH ri7ht of self(or7ani6ation differs si7nificantly
fro4 that of e4ployees in the private sector. The latterHs ri7ht of self(or7ani6ation, i.e., ?to for4, ,oin
or assist la#or or7ani6ations or purposes o collective bargaining,? ad4ittedly includes the ri7ht to
deal and ne7otiate 3ith their respective e4ployers in order to fi= the ter4s and conditions of
e4ploy4ent and also, to en7a7e in concerted activities for the attain4ent of their o#,ectives, such as
stri%es, pic%etin7, #oycotts. .ut the ri7ht of 7overn4ent e4ployees to ?for4, ,oin or assist e4ployees
or7ani6ations of their o3n choosin7? under E=ecutive "rder /o. 0'* is not re7arded as e=istin7 or
availa#le for ?purposes of collective #ar7ainin7,? #ut si4ply ?for the furtherance and protection of
their interests.?
38
In other 3ords, the ri7ht of 9overn4ent e4ployees to deal and ne7otiate 3ith their respective
e4ployers is not @uite as e=tensive as that of private e4ployees. E=cluded fro4 ne7otiation #y
7overn4ent e4ployees are the ?ter4s and conditions of e4ploy4ent ... t(at are i2e) b! la>,? it
#ein7 only those ter4s and conditions not other3ise fi=ed #y la3 that ?4ay #e su#,ect of ne7otiation
#et3een the duly reco7ni6ed e4ployeesH or7ani6ations and appropriate 7overn4ent
authorities,?
39
nd 3hile E" /o. 0'* concedes to 7overn4ent e4ployees, li%e their counterparts in the
private sector, the ri7ht to en7a7e in concerted activities, inclu)ing t(e rig(t to stri$e, the e=ecutive order
is @uic% to add that those activities 4ust #e e=ercised in accor)ance >it( la>, i.e. are su#,ect #oth to
?Civil Service !a3 and rules? and ?any le7islation that 4ay #e enacted #y Con7ress,?
)5
that ?the
resolution of co4plaints, 7rievances and cases involvin7 7overn4ent e4ployees? is not ordinarily left to
collective #ar7ainin7 or other related concerted activities, #ut to ?Civil Service !a3 and la#or la3s and
procedures 3henever applica#le;? and that in case ?any dispute re4ains unresolved after e=haustin7 all
availa#le re4edies under e=istin7 la3s and procedures, the parties 4ay ,ointly refer the dispute to the
(Pu#lic Sector !a#or(5ana7e4ent$ Council for appropriate action.?
)1
Chat is 4ore, the Rules and
Re7ulations i4ple4entin7 E=ecutive "rder /o. 0'* e=plicitly provide that since the ?ter4s and conditions
of e4ploy4ent in the 7overn4ent, includin7 any political su#division or instru4entality thereof and
7overn4ent(o3ned and controlled corporations 3ith ori7inal charters are 7overned #y la3, the e4ployees
therein s(all not stri$e for the purpose of securin7 chan7es thereof.
)2
"n the 4atter of li4itations on 4e4#ership in la#or unions of 7overn4ent e4ployees, E=ecutive
"rder /o. 0'* declares that ?hi7h level e4ployees 3hose functions are nor4ally considered as
policy 4a%in7 or 4ana7erial, or 3hose duties are of a hi7hly confidential nature shall not #e eli7i#le
to ,oin the or7ani6ation of ran%(and(file 7overn4ent e4ployees.
)3
?(ig( level emplo!ee? is one
?3hose functions are nor4ally considered policy deter4inin7, 4ana7erial or one 3hose duties are hi7hly
confidential in nature. 4ana7erial function refers to the e=ercise of po3ers such as8 0. To effectively
reco44end such 4ana7erial actions; 1. To for4ulate or e=ecute 4ana7e4ent policies and decisions; or
&. To hire, transfer, suspend, lay off, recall, dis4iss, assi7n or discipline e4ployees.
))
Republic Act +o. <9?:
The rule re7ardin7 4e4#ership in la#or or7ani6ations of 4ana7erial and supervisory e4ployees ,ust
adverted to, 3as clarified and refined #y Repu#lic ct /o. 6A05, effective on 5arch 10, 02'2, further
a4endin7 the !a#or Code.
Inder R 6A05 la#or unions are re7arded as or7ani6ed either (a$ ?for purposes of ne7otiation,? or
(#$ ?for furtherance and protection?of the 4e4#ersH ri7hts. 5e4#ership in unions or7ani6ed ?for
purposes of ne7otiation? is open only to ran%(and(file e4ployees. ?.upervisor! emplo!ees? are
ineli7i#le ?for 4e4#ership in a la#or or7ani6ation of the ran%(and(file e4ployees #ut 4ay ,oin, assist
or for4 separate la#or or7ani6ations of their o3n,? i.e., one or7ani6ed ?for furtherance and
protection? of their ri7hts and interests. Do3ever, accordin7 to the Rules i4ple4entin7 R 6A05,
?supervisor! emplo!ees >(o are inclu)e) in an e2isting ran$-an)- ile bargaining unit, upon the
effectivity of Repu#lic ct /o. 6A05 shall re4ain in that unit ...? Supervisory e4ployees are ?those
3ho, in the interest of the e4ployer, effectively reco44end such 4ana7erial actions
)(
if the e=ercise
of such authority is not 4erely routinary or clerical in nature #ut re@uires the use of independent
,ud74ent.
)*
5e4#ership in e4ployeesH or7ani6ations for4ed for purposes of ne7otiation are open to ran%(and(
file e4ployees only, as a#ove 4entioned, and not to (ig( level emplo!ees.
)7
Indeed, ?managerial
emplo!ees? or ?(ig( level emplo!ees? are, to repeat, ?not eligible to ,oin, assist or for4 any la#or
or7ani6ation? at all.
)8
managerial emplo!ee is defined as ?one 3ho is vested 3ith po3ers or
prero7atives to lay do3n and e=ecute, 4ana7e4ent policies and>or to hire, transfer, suspend, lay(off,
recall, dischar7e, assi7n or discipline e4ployees.?
)9
This is ho3 the la3 no3 stands, particularly 3ith respect to supervisory e4ployees vis a vis la#or
or7ani6ations of e4ployees under the4.
/o3, the 9SIS perfor4s proprietary functions. It is a non(stoc% corporation, 4ana7ed #y a .oard of
Trustees e=ercisin7 the ?usual corporate po3ers.?
(5
In other 3ords, it e=ercises all the po3ers of a
corporation under the Corporation !a3 in so far as they are not other3ise inconsistent 3ith other
applica#le la3.
(1
It is en7a7ed essentially in insurance, a #usiness that ?is not inherently or e=clusively a
7overn4ental function, ... (#ut$ is on the contrary, in essence and practice, of a private nature and
interest.?
(2
0. The petitioners contend that the ri7ht of self(or7ani6ation and collective#ar7ainin7 had #een
3ithdra3n #y the !a#or Code fro4 7overn4ent e4ployees includin7 those in 7overn4ent(o3ned
and controlled corporations( chiefly for the reason that the ter4s and conditions of 7overn4ent
e4ploy4ent, all e4#raced in civil service, 4ay not #e 4odified #y collective #ar7ainin7 #ecause set
#y la3. It is therefore i44aterial, they say, 3hether supervisors are 4e4#ers of ran%(and(file unions
or not; after all, the possi#ility of the e4ployerHs control of the 4e4#ers of the union thru supervisors
thus renderin7 collective #ar7ainin7 illusory, 3hich is the 4ain reason for the prohi#ition, is no lon7er
of any conse@uence.
This 3as true, for a ti4e. s already discussed, #oth under the !a#or Code and P- '*A, 7overn4ent
e4ployees, includin7 those in 7overn4ent(o3ned or controlled corporations, 3ere indeed precluded
fro4 #ar7ainin7 as re7ards ter4s and conditions of e4ploy4ent #ecause these 3ere set #y la3 and
hence could not possi#ly #e altered #y ne7otiation.
.ut E" 000 restored the ri7ht to or7ani6e and to ne7otiate and #ar7ain of e4ployees of ?7overn4ent
corporations esta#lished under the Corporation Code.? nd E" 0'*, and apparently R 6A05, too,
7ranted to all 7overn4ent e4ployees the ri7ht of collective #ar7ainin7 or ne7otiation e=cept as
re7ards those ter4s of their e4ploy4ent 3hich 3ere fi=ed #y la3; and as to said ter4s fi=ed #y la3,
they 3ere prohi#ited to stri%e to o#tain chan7es thereof.
1. The petitioners appear to #e correct in their vie3 of the disappearance fro4 the la3 of the
prohi#ition on supervisors #ein7 4e4#ers of la#or or7ani6ations co4posed of e4ployees under
their supervision. The !a#or Code (P- ))1$ allo3ed supervisors (if not 4ana7erial$ to ,oin ran%(and(
file unions. nd under the I4ple4entin7 Rules of R 6A05, supervisors 3ho 3ere 4e4#ers of
e=istin7 la#or or7ani6ations on the effectivity of said R 6A05 3ere e=plicitly authori6ed to ?re4ain
therein.?
&. The correctness of the petitionersH theory that unfair la#or practices ceased to #e cri4es and 3ere
dee4ed 4erely ad4inistrative offenses in virtue of the !a#or Code, cannot #e 7ainsaid. rticle 15*
of the !a#or Code did provide as follo3s8
RT. 15*. Concept o unair labor practice.(The concept of unfair la#or practice is
here#y 4odified. Denceforth, it shall #e considered 4erely as an ad4inistrative
offense rather than a cri4inal offense. Infair la#or practice co4plaints shall,
therefore, #e processed li%e any ordinary la#or disputes.
.ut unfair la#or practices 3ere declared to #e cri4es a7ain #y later a4end4ents of the !a#or Code
effected #y .atas Pa4#ansa .l7. A*, approved on 5ay 0, 02'*. s thus a4ended, the Code no3
pertinently reads as follo3s8
RT. 1)'. Concept o unair labor practice an) proce)ure or prosecution t(ereo.
F Infair la#or practices violate the ri7ht of 3or%ers and e4ployees to self
or7ani6ation, are ini4ical to the le7iti4ate interests of #oth la#or and 4ana7e4ent
includin7 their ri7ht to #ar7ain collectively and other3ise deal 3ith each other in an
at4osphere of freedo4 and 4utual respect, and hinder the pro4otion of healthy and
sta#le la#or 4ana7e4ent relations. Conse@uently, unfair la#or practices are not only
violations of the civil ri7hts of #oth la#or and 4ana7e4ent #ut are also offenses
a7ainst the State 3hich shall #e su#,ect to prosecution and punish4ent as herein
provided.
=== === ===
Recovery of civil lia#ility in the ad4inistrative proceedin7s shall #ar recovery under
the Civil Code.
/o cri4inal prosecution under this title 4ay #e instituted 3ithout a final ,ud74ent,
findin7 that an unfair la#or practice 3as co44itted havin7 #een first o#tained in the
precedin7 para7raph. ...
The decisive consideration is that at present, supervisors 3ho 3ere already 4e4#ers of a ran%(and(
file la#or or7ani6ation at the ti4e of the effectivity of R.. /o. 6A05, are authori6ed to ?re4ain
therein.? It see4s plain, in other 3ords, that the 4aintenance #y supervisors of 4e4#ership in a
ran%(and(file la#or or7ani6ation even after the enact4ent of a statute i4posin7 a prohi#ition on such
4e4#ership, is not only not a cri4e, #ut is e=plicitly allo3ed, under present la3.
/o3, in a case decided as early as 02&5, People v. "ama!o,
(3
3here the appellants had appealed
fro4 a ,ud74ent convictin7 the4 of a violation of a 4unicipal (ordinance, and 3hile their appeal 3as
pendin7, the ordinance 3as repealed such that the act co4plained of ceased to #e a cri4inal act #ut
#eca4e le7al, this Court dis4issed the cri4inal proceedin7s, pronouncin7 the effects of the repeal to #e
as follo3s8
In the leadin7 case of the Unite) .tates vs. Cuna (01 Phil. 1)0$, and 5ing vs. Unite)
.tates (10' I.S. 1A1$, the doctrine 3as clearly esta#lished that in the Philippines
repeal of a cri4inal act #y its reenact4ent, even 3ithout a savin7 clause 3ould not
destroy cri4inal lia#ility. .ut not a sin7le sentence in either derision indicates that
there 3as any desire to hold that a person could #e prosecuted convicted, and
punished for acts no lon7er cri4inal.
There is no @uestion that at co44on la3 and in 4erica a 4uch 4ore favora#le
attitude to3ards the accused e=ists relative to statutes that have #een repealed than
has #een adopted here. "ur rule is 4ore in confor4ity 3ith the Spanish doctrine, #ut
even in Spain, 3here the offense ceased to #e cri4inal, petition cannot #e had (0
Pacheco, Co44entaries, 126$.
The repeal here 3as a#solute and not a reenact4ent and repeal #y i4plication. /or
3as there any savin7 clause. The le7islative intent as sho3n #y the action of the
4unicipal is that such conduct, for4erly denounced, is no lon7er dee4ed cri4inal,
and it 3ould #e illo7ical for this court to atte4pt to sentence appellant for the offense
that no lon7er e=ists.
Ce are therefore of the opinion that the proceedin7s a7ainst appellant 4ust #e
dis4issed.
To the sa4e effect and in even 4ore un4ista%a#le lan7ua7e is People v. Almuete
()
3here the
defendants(appellees 3ere char7ed under section &2 of Repu#lic ct /o. 0022, as a4ended (the
7ricultural !and Tenancy !a3 of 025)$ 3hich penali6ed pre(threshin7 #y either a7ricultural tenant or his
landlord. They sou7ht and secured a dis4issal on the 7round, a4on7 others, that there 3as no la3
punishin7 the act char7ed(a reference to the fact that Repu#lic ct /o. 0022 had already #een
superseded #y the 7ricultural !and Refor4 Code of 026& 3hich instituted the leasehold syste4 and
a#olished share tenancy su#,ect to certain conditions. "n appeal #y the 9overn4ent, this Court upheld
the dis4issal, sayin78
The le7islative intent not to punish any4ore the tenantHs act of pre(reapin7 and pre(
threshin7 3ithout notice to the landlord is infera#le fro4 the fact that, as already
noted, the Code of 7rarian Refor4s did not reenact section &2 of the 7ricultural
Tenancy !a3 and that it a#olished share tenancy 3hich is the #asis for penali6in7
clandestine pre(reapin7 and pre(threshin7.
=== === ===
s held in the A)illo case,
((
the act of pre(reapin7 and pre(threshin7 3ithout notice to
the landlord, 3hich is an offense under the 7ricultural Tenancy !a3, had ceased to #e
an offense under the su#se@uent la3, the Code of 7rarian Refor4s. To prosecute it as
an offense 3hen the Code of 7rarian Refor4s is already in force 3ould #e repu7nant or
a#horrent to the policy and spirit of that Code and 3ould su#vert the 4anifest le7islative
intent not to punish any4ore pre(reapin7 and pre(threshin7 3ithout notice to the
landholder.
=== === ===
The repeal of a penal la3 deprives the courts of ,urisdiction to punish persons
char7ed 3ith a violation of the old penal la3 prior to its repeal (People vs. Ta4ayo,
60 Phil. 115; People vs. Sindion7 and Pastor, AA Phil. 0***; People vs. .inuya, 60
Phil. 1*'; I.S. vs. Reyes, 0* Phil. )1&; I.S. vs. cade4ia, 0* Phil. )&0. See dissent
in !a7ri4as vs. -irector of Prisons, 5A Phil. 1)A, 151, 15)$.
The fore7oin7 precedents dictate a#solution of the appellants of the offenses i4puted to the4.
CDERE+"RE, the ,ud74ents of conviction in C(9.R. /o. 0)A1)(CR and C(9.R. /o. 0)'56(CR,
su#,ect of the appeal, as 3ell as those in Cri4. Case /o. 51A5(R and Cri4. Case /o. )0&*(R
rendered #y the Trial Court, are REGERSE- and the accused(appellants CNIITTE- of the
char7es a7ainst the4, 3ith costs )e oicio.
S" "R-ERE-.
Cru,, -anca!co, -ri4o-A0uino an) 3e)ial)ea, **., concur.

Case No 6
EN BANC
[G.R. No. 122226. March 25, 1998]
UNITED PEPSI-COLA SUPERVISORY UNION (UPSU), petitioner, vs. HON. BIENVENIDO
E. LAGUESMA and PEPSI-COLA PRODUCTS, PHILIPPINES, INC. respondents.
D E C I S I O N
MENDOZA, J.:
Petitioner is a union of supervisory employees. It appears that on March 20, 1995 the union
fled a petition for certifcation election on behalf of the route managers at Pepsi-Cola Products
Philippines, Inc. However, its petition was denied by the med-arbiter and, on appeal, by the
Secretary of Labor and Employment, on the ground that the route managers are managerial
employees and, therefore, ineligible for union membership under the frst sentence of Art. 245 of
the Labor Code, which provides:
Ineligibility of managerial employees to join any labor organization; right of supervisory employees.
Managerial employees are not eligible to join, assist or form any labor
organization. Supervisory employees shall not be eligible for membership in a labor
organization of the rank-and-fle employees but may join, assist or form separate labor
organizations of their own.
Petitioner brought this suit challenging the validity of the order dated August 31, 1995, as
reiterated in the order dated September 22, 1995, of the Secretary of Labor and Employment. Its
petition was dismissed by the Third Division for lack of showing that respondent committed
grave abuse of discretion. But petitioner fled a motion for reconsideration, pressing for
resolution its contention that the frst sentence of Art. 245 of the Labor Code, so far as it declares
managerial employees to be ineligible to form, assist or join unions, contravenes Art. III 8 of
the Constitution which provides:
The right of the people, including those employed in the public and private sectors, to form
unions, associations, or societies for the purposes not contrary to law shall not be abridged.
For this reason, the petition was referred to the Court en banc.
The Issues in this Case
Two question are presented by the petition: (1) whether the route managers at Pepsi-Cola
Products Philippines, Inc. are managerial employees and (2) whether Art. 245, insofar as it
prohibits managerial employees from forming, joining or assisting labor unions, violates Art. III,
8 of the Constitution.
In resolving these issues it would be useful to begin by defning who are managerial
employees and considering the types of managerial employees.
Types of Managerial Employees
The term manager generally refers to anyone who is responsible for subordinates and
other organization resources.
[1]
As a class, managers constitute three levels of a pyramid:
Top Management
_________________
Middle Management
_________________
First Line
Management
(also called Supervisor)
____________________
____________________
Operatives
Or Operating Employees
FIRST-LINE MANAGERS The lowest level in an organization at which individuals are
responsible for the work of others is called frst-line or frst-level management. First-line managers
direct operating employees only; they do not supervise other managers. Example of frst-line
managers are the foreman or production supervisor in a manufacturing plant, the technical
supervisor in a research department, and the clerical supervisor in a large ofce. First-level
managers are often called supervisors.
MIDDLE MANAGERS The term middle management can refer to more than one level in an
organization. Middle managers direct the activities of other managers and sometimes also
those of operating employees. Middle managers principal responsibilities are to direct the
activities that implement their organizations policies and to balance the demands of their
superiors with the capacities of their subordinates. A plant manager in an electronics frm is an
example of a middle manager.
TOP MANAGERS Composed of a comparatively small group of executives, top management is
responsible for the overall management of the organization. It establishes operating policies
and guides the organizations interactions with its environment. Typical titles of top managers
are chief executive ofcer, president, and senior vice-president. Actual titles vary from
one organization to another and are not always a reliable guide to membership in the highest
management classifcation.
[2]
As can be seen from this description, a distinction exist between those who have the
authority to devise, implement and control strategic and operational policies (top and middle
managers) and those whose task is simply to ensure that such polices are carried out by the
rank-and-fle employees of an organization (frst-level managers/supervisors). What
distinguishes them from the rank-and fle employees is that they act in the interest of the
employer in supervising such rank-and-fle employees.
Managerial employees may therefore be said to fall into two distinct categories: the
managers per se, who compose the former group described above, and the supervisors who
form the latter group. Whether they belong to the frst or second category, managers, vis--vis
employers, are, likewise, employees.
[3]
The frst question is whether route managers are managers are managerial employees or
supervisors.
Previous Administrative Determinations of the Question Whether Route Managers are Managerial Employees
It appears that this question was the subject of two previous determinations by the
Secretary of Labor and Employment, in accordance with which this case was decided by the
med-arbiter.
In Case No. OS-MA-10318-91, entitled Workerss Alliance Trade Union (WATU) v. Pepsi-
Cola Products Philippines, Inc., decided on November 13, 1991, the Secretary of Labor found:
We examined carefully the pertinent job description of the subject employees and other
documentary evidence on record vis--vis paragraph (m), Article 212 of the Labor Code, as
amended, and we fnd that only those employees occupying the position of route manager and
accounting manager are managerial employees. The rest i.e. quality control manager,
yard/transport manager and warehouse operations manager are supervisory employees.
To qualify as managerial employee, there must be a clear showing of the exercise of managerial
attributes under paragraph (m), Article 212 of the Labor Code as amended. Designations or
titles of positions are not controlling. In the instant case, nothing on record will support the
claim that the quality control manager, yard/transport manager and warehouse operations
manager are vested with said attributes. The warehouse operations manager, for example,
merely assists the plant fnance manager in planning, organizing, directing and controlling all
activities relative to development and implementation of an efective management control
information system at the sale ofces. The exercise of authority of the quality control manager,
on the other hand, needs the concurrence of the manufacturing manager
As to the route managers and accounting manager, we are convinced that they are managerial
employees. Their job descriptions clearly reveal so.
On July 6, 1992, this fnding was reiterated in Case No. OS-A-3-71-92, entitled In
Re: Petition for Direct Certifcation and/or Certifcation Election-Route Managers/Supervisory
Employees of Pepsi-Cola Products Phils. Inc., as follows:
The issue brought before us is not of frst impression. At one time, we had the occasion to rule
upon the status of route manager in the same company vis a vis the issue as to whether or not it
is supervisory employee or a managerial employee. In the case of Workers Alliance Trade
Unions (NATU) vs. Pepsi Cola Products, Phils., Inc. (OS-MA-A-10-318-91), 15 November 1991,
we ruled that a route manager is a managerial employee within the context of the defnition of
the law, and hence, ineligible to join, form or assist a union. We have once more passed upon the
logic of our Decision aforecited in the light of the issues raised in the instant appeal, as well as
the available documentary evidence on hand, and have come to the view that there is no cogent
reason to depart from our earlier holding. Route Managers are, by the very nature of their
functions and the authority they wield over their subordinates, managerial employees. The
prescription found in Art. 245 of the Labor Code, as amended therefore, clearly applies to them.
[4]
4
Citing our ruling in Nasipit Lumber Co. v. National Labor Relations Commission,
[5]
5
however, petitioner argues that these previous administrative determinations do not have the
efect of res judicata in this case, because "labor relations proceedings" are "non-litigious and
summary in nature without regard to legal technicalities."
[6]
Nasipit Lumber Co. involved a
clearance to dismiss an employee issued by the Department of Labor. The question was
whether in a subsequent proceeding for illegal dismissal, the clearance was res judicata. In
holding it was not, this Court made it clear that it was referring to labor relations proceedings of
a non-adversary character, thus:
The requirement of a clearance to terminate employment was a creation of the Department of
labor to carry out the Labor Code provisions on security of tenure and termination of
employment. The proceeding subsequent to the fling of an application for clearance to
terminate employment was outlined in Book V, Rule XIV of the Rules and Regulations
Implementing the Labor Code. The fact that said rule allowed a procedure for the approval of
the clearance with or without the opposition of the employee concerned (Secs. 7 & 8),
demonstrates the non-litigious and summary nature of the proceeding. The clearance
requirement was therefore necessary only as an expeditious shield against arbitrary dismissal
without the knowledge and supervision of the Department of Labor. Hence, a duly approved
clearance implied that the dismissal was legal or for cause (Sec. 2).
[7]
v. National Labor Relations
Commission, 177 SCRA 93, 100 (1989).7
But the doctrine of res judicata certainly applies to adversary administrative
proceedings. As early as 1956, in Brillantes v. Castro,
[8]
8 we sustained the dismissal of an action
by a trial court on the basis of a prior administrative determination of the same case by the
Wage Administration Service, applying the principle of res judicata. Recently, in Abad v.
NLRC
[9]
9 we applied the related doctrine of stare decisis in holding that the prior determination
that certain jobs at the Atlantic Gulf and Pacifc Co. were project employments was binding in
another case involving another group of employees of the same company. Indeed, in Nasipit
Lumber Co., this Court clarifed toward the end of its opinion that "the doctrine of res
judicata applies . . . to judicial or quasi judicial proceedings and not to the exercise of
administrative powers."
[10]
v. National Labor Relations Commission, supra note 7.10 Now
proceedings for certifcation election, such as those involved in Case No. OS-M-A-10-318-91 and
Case No. OS-A-3-71-92, are quasi judicial in nature and, therefore, decisions rendered in such
proceedings can attain fnality.
[11]
v. B.F. Goodrich (Marikina Factory) Confdential and Salaries
Employees Union-NATU, 49 SCRA 532 (1973).11
Thus, we have in this case an expert's view that the employees concerned are managerial
employees within the purview of Art. 212 which provides:
(m) "managerial employee" is one who is vested with powers or prerogatives to lay down
and execute management policies and/or to hire, transfer, suspend, lay of, recall, discharge,
assign or discipline employees. Supervisory employees are those who, in the interest of the
employer, efectively recommend such managerial actions if the exercise of such authority is not
merely routinary or clerical in nature but requires the use of independent judgment. All
employees not falling within any of the above defnitions are considered rank-and-fle
employees for purposes of this Book.
At the very least, the principle of fnality of administrative determination compels respect for
the fnding of the Secretary of Labor that route managers are managerial employees as defned
by law in the absence of anything to show that such determination is without substantial
evidence to support it. Nonetheless, the Court, concerned that employees who are otherwise
supervisors may wittingly or unwittingly be classifed as managerial personnel and thus denied
the right of self- organization, has decided to review the record of this case.
DOLE's Finding that Route Managers are Managerial Employees Supported by Substantial Evidence in the Record
The Court now fnds that the job evaluation made by the Secretary of Labor is indeed
supported by substantial evidence. The nature of the job of route managers is given in a four-
page pamphlet, prepared by the company, called "Route Manager Position Description," the
pertinent parts of which read:
A. BASIC PURPOSE
A Manager achieves objectives through others.
As a Route Manager, your purpose is to meet the sales plan; and you achieve this
objective through the skillful MANAGEMENT OF YOUR JOB AND THE
MANAGEMENT OF YOUR PEOPLE.
These then are your functions as Pepsi-Cola Route Manager. Within these functions -
managing your job and managing your people - you are accountable to your District
Manager for the execution and completion of various tasks and activities which will
make it possible for you to achieve your sales objectives.
B. PRINCIPAL ACCOUNTABILITIES
1.0 MANAGING YOUR JOB
The Route Manager is accountable for the following:
1.1 SALES DEVELOPMENT
1.1.1 Achieve the sales plan.
1.1.2 Achieve all distribution and new account objectives.
1.1.3 Develop new business opportunities thru personal contacts with dealers.
1.1.4 Inspect and ensure that all merchandizing [sic] objectives are achieved in all
outlets.
1.1.5 maintain and improve productivity of all cooling equipment and kiosks.
1.1.6 Execute and control all authorized promotions.
1.1.7 Develop and maintain dealer goodwill.
1.1.8 Ensure all accounts comply with company suggested retail pricing.
1.1.9 Study from time to time individual route coverage and productivity for
possible adjustments to maximize utilization of resources.
1.2 Administration
1.2.1 Ensure the proper loading of route trucks before check-out and the proper
sorting of bottles before check-in.
1.2.2 Ensure the upkeep of all route sales reports and all other related reports
and forms required on an accurate and timely basis.
1.2.3 Ensure proper implementation of the various company policies and
procedures incl. but not limited to shakedown; route shortage;
progressive discipline; sorting; spoilages; credit/collection; accident;
attendance.
1.2.4 Ensure collection of receivables and delinquent accounts.
2.0 MANAGING YOUR PEOPLE
The Route Manager is accountable for the following:
2.1 Route Sales Team Development
2.1.1 Conduct route rides to train, evaluate and develop all assigned route
salesmen and helpers at least 3 days a week, to be supported by required
route ride documents/reports & back check/spot check at least 2 days a
week to be supported by required documents/reports.
2.1.2 Conduct sales meetings and morning huddles. Training should focus on
the enhancement of efective sales and merchandizing [sic] techniques of
the salesmen and helpers. Conduct group training at least 1 hour each
week on a designated day and of specifc topic.
2.2 Code of Conduct
2.2.1 Maintain the company's reputation through strict adherence to PCPPI's
code of conduct and the universal standards of unquestioned business
ethics.
[12]
12
Earlier in this opinion, reference was made to the distinction between managers per se (top
managers and middle managers) and supervisors (frst-line managers). That distinction is
evident in the work of the route managers which sets them apart from supervisors in
general. Unlike supervisors who basically merely direct operating employees in line with set
tasks assigned to them, route managers are responsible forthe success of the company's main
line of business through management of their respective sales teams. Such management
necessarily involves the planning, direction, operation and evaluation of their individual teams
and areas which the work of supervisors does not entail.
The route managers cannot thus possibly be classifed as mere supervisors because their
work does not only involve, but goes far beyond, the simple direction or supervision of
operating employees to accomplish objectives set by those above them. They are not mere
functionaries with simple oversight functions but business administrators in their own
right. An idea of the role of route managers as managers per se can be gotten from a memo sent
by the director of metro sales operations of respondent company to one of the route
managers. It reads:
[13]
03 April 1995
To : CESAR T. REOLADA
From : REGGIE M. SANTOS
Subj : SALARY INCREASE
Efective 01 April 1995, your basic monthly salary of P11,710 will be increased
to P12,881 or an increase of 10%. This represents the added managerial responsibilities
you will assume due to the recent restructuring and streamlining of Metro Sales Operations
brought about by the continuous losses for the last nine (9) months.
Let me remind you that for our operations to be proftable, we have to sustain the intensity
and momentum that your group and yourself have shown last March. You just have
to deliver the desired volume targets, better negotiated concessions, rationalized
sustaining deals,'96-6"a,' o/ /'#78'# o>'/#7'&, 6-+/o>'# 8o99'8,6o"&,
-o/' 8a&: a88o7",&, 8o",/o99'# o+'/a,6"? '@+'"&'&, etc. lso, #ased
on the a7reed set tar7ets, your 4onthly perfor4ance 3ill #e closely
4onitored.
You have proven in the past that your capable of achieving your targets thru better
planning, managing your group as a fghting team, and thru aggressive selling. I am
looking forward to your success and I expect that you just have to exert your doubly best
in turning around our operations from a losing to a proftable one!
Happy Selling!!
(Sgd.) R.M. SANTOS
The plasticized card given to route managers, quoted in the separate opinion of Justice
Vitug, although entitled "RM's Job Description," is only a summary of performance standards. It
does not show whether route managers are managers per se or supervisors. Obviously, these
performance standards have to be related to the specifc tasks given to route managers in the
four-page "Route Manager Position Description," and, when this is done, the managerial nature
of their jobs is fully revealed. Indeed, if any, the card indicates the great latitude and discretion
given to route managers - from servicing and enhancing company goodwill to supervising and
auditing accounts, from trade (new business) development to the discipline, training and
monitoring of performance of their respective sales teams, and so forth, - if they are to fulfll the
company's expectations in the "key result areas."
Article 212(m) says that "supervisory employees are those who, in the interest of the
employer, efectively recommend such managerial actions if the exercise of such authority is not
merely routinary or clerical in nature but requires the use of independent judgment." Thus,
their only power is to recommend. Certainly, the route managers in this case more than merely
recommend efective management action. They perform operational, human resource, fnancial
and marketing functions for the company, all of which involve the laying down of operating
policies for themselves and their teams. For example, with respect to marketing, route
managers, in accordance with B.1.1.1 to B.1.1.9 of the Route Managers Job Description, are
charged, among other things, with expanding the dealership base of their respective sales areas,
maintaining the goodwill of current dealers, and distributing the company's various
promotional items as they see ft. It is difcult to see how supervisors can be given such
responsibility when this involves not just the routine supervision of operating employees but
the protection and expansion of the company's business vis-a-vis its competitors.
While route managers do not appear to have the power to hire and fre people (the evidence
shows that they only "recommended" or "endorsed" the taking of disciplinary action against
certain employees), this is because this is a function of the Human Resources or Personnel
Department of the company.
[14]
14 And neither should it be presumed that just because they are
given set benchmarks to observe, they are ipso facto supervisors. Adequate control methods (as
embodied in such concepts as "Management by Objectives [MBO]" and "performance
appraisals") which require a delineation of the functions and responsibilities of managers by
means of ready reference cards as here, have long been recognized in management as efective
tools for keeping businesses competitive.
This brings us to the second question, whether the frst sentence of Art. 245 of the Labor
Code, prohibiting managerial employees from forming, assisting or joining any labor
organization, is constitutional in light of Art. III, 8 of the Constitution which provides:
The right of the people, including those employed in the public and private sectors, to form
unions, associations, or societies for purposes not contrary to law shall not be abridged.
As already stated, whether they belong to the frst category (managers per se) or the second
category (supervisors), managers are employees. Nonetheless, in the United States, as Justice
Puno's separate opinion notes, supervisors have no right to form unions. They are excluded
from the defnition of the term "employee" in 2(3) of the Labor-Management Relations Act of
1947.
[15]
v. Bell Aerospace Co., 416 U.S. 281, n 11, 40 L.Ed.2d 134, 147, n. 11 (1974), thus:
Supervisors are management people. They have distinguished themselves in their
work. They have demonstrated their ability to take care of themselves without depending upon
the pressure of collective action. No one forced them to become supervisors. They abandoned
the "collective security" of the rank and fle voluntarily, because they believed the opportunities
thus opened to them to be more valuable to them than such "security". It seems wrong, and it is
wrong, to subject people of this kind, who have demonstrated their initiative, their ambition and
their ability to get ahead, to the leveling processes of seniority, uniformity and standardization
that the Supreme Court recognizes as being fundamental principles of unionism. (J.I. Case
Co. v. National Labor Relations Board, 321 U.S. 332, 88 L.Ed. 762, 64 S. Ct. 576 (1994). It is wrong
for the foremen, for it discourages the things in them that made them foremen in the frst
place. For the same reason, that it discourages those best qualifed to get ahead, it is wrong for
industry, and particularly for the future strength and productivity of our country.15 In the
Philippines, the question whether managerial employees have a right of self-organization has
arisen with respect to frst-level managers or supervisors, as shown by a review of the course of
labor legislation in this country.
Right of Self-Organization of Managerial Employees under Pre-Labor Code Laws
Before the promulgation of the Labor Code in 1974, the feld of labor relations was
governed by the Industrial Peace Act (R.A. No. 875).
In accordance with the general defnition above, this law defned "supervisor" as follows:
SECTION 2. . . .
(k) "Supervisor" means any person having authority in the interest of an employer, to hire,
transfer, suspend, lay-of, recall, discharge, assign, recommend, or discipline other employees, or
responsibly to direct them, and to adjust their grievances, or efectively to recommend such acts,
if, in connection with the foregoing, the exercise of such authority is not of a merely routinary or
clerical nature but requires the use of independent judgment.
[16]
16
The right of supervisors to form their own organizations was afrmed:
SEC. 3. Employees' Right to Self-Organization. -- Employees shall have the right to self-
organization and to form, join or assist labor organizations of their own choosing for the
purpose of collective bargaining through representatives of their own choosing and to engage in
concerted activities for the purpose of collective bargaining and other mutual aid and
protection. Individuals employed as supervisors shall not be eligible for membership in a labor
organization of employees under their supervision but may form separate organizations of their
own.
[17]
For its part, the Supreme Court upheld in several of its decisions the right of supervisors to
organize for purposes of labor relations.
[18]
v. Filoil Supervisory and Confdential Employees
Association, 6 SCRA 522 (1972); Kapisanan ng mga Manggagawa sa Manila Railroad Co. v. CIR,
106 Phil 607 (1959).18
Although it had a defnition of the term "supervisor," the Industrial Peace Act did not
defne the term "manager." But, using the commonly-understood concept of "manager," as above
stated, it is apparent that the law used the term "supervisors" to refer to the sub-group of
"managerial employees" known as front-line managers. The other sub-group of "managerial
employees," known as managers per se, was not covered.
However, in Caltex Filipino Managers and Supervisors Association v. Court of Industrial
Relations,
[19]
J.)19 the right of all managerial employees to self-organization was upheld as a
general proposition, thus:
It would be going too far to dismiss summarily the point raised by respondent Company - that
of the alleged identity of interest between the managerial staf and the employing frm. That
should ordinarily be the case, especially so where the dispute is between management and the
rank and fle. It does not necessarily follow though that what binds the managerial staf to the
corporation forecloses the possibility of confict between them. There could be a real diference
between what the welfare of such group requires and the concessions the frm is willing to
grant. Their needs might not be attended to then in the absence of any organization of their
own. Nor is this to indulge in empty theorizing. The record of respondent Company, even the
very case cited by it, is proof enough of their uneasy and troubled relationship. Certainly the
impression is difcult to erase that an alien frm failed to manifest sympathy for the claims of its
Filipino executives. To predicate under such circumstances that agreement inevitably marks
their relationship, ignoring that discord would not be unusual, is to fy in the face of reality.
. . . The basic question is whether the managerial personnel can organize. What respondent
Company failed to take into account is that the right to self-organization is not merely a
statutory creation. It is fortifed by our Constitution. All are free to exercise such right unless
their purpose is contrary to law. Certainly it would be to attach unorthodoxy to, not to say an
emasculation of, the concept of law if managers as such were precluded from
organizing. Having done so and having been duly registered, as did occur in this case, their
union is entitled to all the rights under Republic Act No. 875. Considering what is
denominated as unfair labor practice under Section 4 of such Act and the facts set forth in our
decision, there can be only one answer to the objection raised that no unfair labor practice could
be committed by respondent Company insofar as managerial personnel is concerned. It is, as is
quite obvious, in the negative.
[20]
20
Actually, the case involved front-line managers or supervisors only, as the plantilla of
employees, quoted in the main opinion,
[21]
J.) (emphasis added).21 clearly indicates:
CAFIMSA members holding the following Supervisory Payroll Position Title are
Recognized by the Company
Payroll Position Title
Assistant to Mgr. - National Acct. Sales
Jr. Sales Engineer
Retail Development Asst.
Staf Asst. - 0 Marketing
Sales Supervisor
Supervisory Assistant
Jr. Supervisory Assistant
Credit Assistant
Lab. Supvr. - Pandacan
Jr. Sales Engineer B
Operations Assistant B
Field Engineer
Sr. Opers. Supvr. - MIA A/S
Purchasing Assistant
Jr. Construction Engineer
St. Sales Supervisor
Deport Supervisor A
Terminal Accountant B
Merchandiser
Dist. Sales Prom. Supvr.
Instr. - Merchandising
Asst. Dist. Accountant B
Sr. Opers. Supervisor
Jr. Sales Engineer A
Asst. Bulk Ter. Supt.
Sr. Opers. Supvr.
Credit Supervisor A
Asst. Stores Supvr. A
Ref. Supervisory Draftsman
Refnery Shift Supvr. B
Asst. Supvr. A - Operations (Refnery)
Refnery Shift Supvr. B
Asst. Lab. Supvr. A (Refnery)
St. Process Engineer B (Refnery)
Asst. Supvr. A - Maintenance (Refnery)
Asst. Supvr. B - Maintenance (Refnery)
Supervisory Accountant (Refnery)
Communications Supervisor (Refnery)
Finally, also deemed included are all other employees excluded from the rank and fle
unions but not classifed as managerial or otherwise excludable by law or applicable
judicial precedents.
Right of Self-Organization of Managerial Employees under the Labor Code
Thus, the dictum in the Caltex case which allowed at least for the theoretical unionization
of top and middle managers by assimilating them with the supervisory group under the broad
phrase "managerial personnel," provided the lynchpin for later laws denying the right of self-
organization not only to top and middle management employees but to front line managers or
supervisors as well. Following the Caltex case, the Labor Code, promulgated in 1974 under
martial law, dropped the distinction between the frst and second sub-groups of managerial
employees. Instead of treating the terms "supervisor" and "manager" separately, the law lumped
them together and called them "managerial employees," as follows:
ART. 212. Defnitions . . . .
(k) "Managerial Employee" is one who is vested with powers or prerogatives to lay down and
execute management policies and/or to hire, transfer, suspend, lay of, recall, discharge, assign
or discipline employees, or to efectively recommend such managerial actions. All employees not
falling within this defnition are considered rank and fle employees for purposes of this Book.
[22]
22
The defnition shows that it is actually a combination of the commonly understood defnitions
of both groups of managerial employees, grammatically joined by the phrase "and/or."
This general defnition was perhaps legally necessary at that time for two reasons. First, the
1974 Code denied supervisors their right to self-organize as theretofore guaranteed to them by
the Industrial Peace Act. Second, it stood the dictum in the Caltex case on its head by
prohibiting all types of managers from forming unions. The explicit general prohibition was
contained in the then Art. 246 of the Labor Code.
The practical efect of this synthesis of legal concepts was made apparent in the Omnibus
Rules Implementing the Labor Code which the Department of Labor promulgated on January
19, 1975. Book V, Rule II, 11 of the Rules provided:
Supervisory unions and unions of security guards to cease operation. - All existing supervisory unions
and unions of security guards shall, upon the efectivity of the Code, cease to operate as such
and their registration certifcates shall be deemed automatically cancelled. However, existing
collective agreements with such unions, the life of which extends beyond the date of efectivity
of the Code, shall be respected until their expiry date insofar as the economic benefts granted
therein are concerned.
Members of supervisory unions who do not fall within the defnition of managerial employees
shall become eligible to join or assist the rank and fle labor organization, and if none exists, to
form or assist in the forming of such rank and fle organization. The determination of who are
managerial employees and who are not shall be the subject of negotiation between
representatives of the supervisory union and the employer. If no agreement is reached between
the parties, either or both of them may bring the issue to the nearest Regional Ofce for
determination.
The Department of Labor continued to use the term "supervisory unions" despite the
demise of the legal defnition of "supervisor" apparently because these were the unions of front
line managers which were then allowed as a result of the statutory grant of the right of self-
organization under the Industrial Peace Act. Had the Department of Labor seen ft to similarly
ban unions of top and middle managers which may have been formed following the dictum in
Caltex, it obviously would have done so. Yet it did not, apparently because no such unions of
top and middle managers really then existed.
Real Intent of the 1986 Constitutional Commission
This was the law as it stood at the time the Constitutional Commission considered the draft
of Art. III, 8. Commissioner Lerum sought to amend the draft of what was later to become Art.
III, 8 of the present Constitution:
MR. LERUM. My amendment is on Section 7, page 2, line 19, which is to insert between the
words "people" and "to" the following: WHETHER EMPLOYED BY THE STATE OR PRIVATE
ESTABLISHMENTS. In other words, the section will now read as follows: "The right of the
people WHETHER EMPLOYED BY THE STATE OR PRIVATE ESTABLISHMENTS to form
associations, unions, or societies for purposes not contrary to law shall not be abridged."
[23]
23
Explaining his proposed amendment, he stated:
MR. LERUM. Under the 1935 Bill of Rights, the right to form associations is granted to all
persons whether or not they are employed in the government. Under that provision, we allow
unions in the government, in government-owned and controlled corporations and in other
industries in the private sector, such as the Philippine Government Employees' Association,
unions in the GSIS, the SSS, the DBP and other government-owned and controlled
corporations. Also, we have unions of supervisory employees and of security guards. But what
is tragic about this is that after the 1973 Constitution was approved and in spite of an express
recognition of the right to organize in P.D. No. 442, known as the Labor Code, the right of
government workers, supervisory employees and security guards to form unions was abolished.
And we have been fghting against this abolition. In every tripartite conference attended by the
government, management and workers, we have always been insisting on the return of these
rights. However, both the government and employers opposed our proposal, so nothing came
out of this until this week when we approved a provision which states:
Notwithstanding any provision of this article, the right to self-organization shall not be denied
to government employees.
We are afraid that without any corresponding provision covering the private sector, the security
guards, the supervisory employees or majority employees [ sic ] will still be excluded, and that is
the purpose of this amendment.
I will be very glad to accept any kind of wording as long as it will amount to absolute
recognition of private sector employees, without exception, to organize.
THE PRESIDENT. What does the Committee say?
FR. BERNAS. Certainly, the sense is very acceptable, but the point raised by Commissioner
Rodrigo is well-taken. Perhaps, we can lengthen this a little bit more to read: "The right of the
people WHETHER UNEMPLOYED OR EMPLOYED BY STATE OR PRIVATE
ESTABLISHMENTS."
I want to avoid also the possibility of having this interpreted as applicable only to the employed.
MR. DE LOS REYES. Will the proponent accept an amendment to the amendment, Madam
President?
MR. LERUM. Yes, as long as it will carry the idea that the right of the employees in the private
sector is recognized.
[24]
Lerum thus anchored his proposal on the fact that (1) government employees, supervisory
employees, and security guards, who had the right to organize under the Industrial Peace
Act, had been denied this right by the Labor Code, and (2) there was a need to reinstate the
right of these employees. In consonance with his objective to reinstate the right of government,
security, and supervisory employees to organize, Lerum then made his proposal:
MR. LERUM. Mr. Presiding Ofcer, after a consultation with several Members of this
Commission, my amendment will now read as follows: "The right of the people INCLUDING
THOSE EMPLOYED IN THE PUBLIC AND PRIVATE SECTORS to form associations, unions, or
societies for purposes not contrary to law shall not be abridged. In proposing that amendment I
ask to make of record that I want the following provisions of the Labor Code to be automatically
abolished, which read:
ART. 245. Security guards and other personnel employed for the protection and security of the
person, properties and premises of the employers shall not be eligible for membership in a labor
organization.
ART. 246. Managerial employees are not eligible to join, assist, and form any labor
organization.
THE PRESIDING OFFICER (Mr. Bengzon). What does the Committee say?
FR. BERNAS. The Committee accepts.
THE PRESIDING OFFICER. (Mr. Bengzon) The Committee has accepted the amendment, as
amended.
Is there any objection? (Silence) The Chair hears none; the amendment, as amended, is
approved.
[25]
The question is what Commissioner Lerum meant in seeking to "automatically abolish" the
then Art. 246 of the Labor Code. Did he simply want "any kind of wording as long as it will
amount to absolute recognition of private sector employees, without exception, to organize"?
[26]
Or, did he instead intend to have his words taken in the context of the cause which moved
him to propose the amendment in the frst place, namely, the denial of the right of supervisory
employees to organize, because he said, "We are afraid that without any corresponding
provision covering the private sector, security guards, supervisory employees or majority [of]
employees will still be excluded, and that is the purpose of this amendment"?
[27]
It would seem that Commissioner Lerum simply meant to restore the right of supervisory
employees to organize. For even though he spoke of the need to "abolish" Art. 246 of the Labor
Code which, as already stated, prohibited "managerial employees" in general from forming
unions, the fact was that in explaining his proposal, he repeatedly referred to "supervisory
employees" whose right under the Industrial Peace Act to organize had been taken away by Art.
246. It is noteworthy that Commissioner Lerum never referred to the then defnition of
"managerial employees" in Art. 212(m) of the Labor Code which put together, under the broad
phrase "managerial employees," top and middle managers and supervisors. Instead, his
repeated use of the term "supervisory employees," when such term then was no longer in the
statute books, suggests a frame of mind that remained grounded in the language of the
Industrial Peace Act.
Nor did Lerum ever refer to the dictum in Caltex recognizing the right of all managerial
employees to organize, despite the fact that the Industrial Peace Act did not expressly provide
for the right of top and middle managers to organize. If Lerum was aware of the Caltex dictum,
then his insistence on the use of the term "supervisory employees" could only mean that he was
excluding other managerial employees from his proposal. If, on the other hand, he was not
aware of the Caltex statement sustaining the right to organize to top and middle managers, then
the more should his repeated use of the term "supervisory employees" be taken at face
value, as it had been defned in the then Industrial Peace Act.
At all events, that the rest of the Commissioners understood his proposal to refer solely to
supervisors and not to other managerial employees is clear from the following account of
Commissioner Joaquin G. Bernas, who writes:
In presenting the modifcation on the 1935 and 1973 texts, Commissioner Eulogio R. Lerum
explained that the modifcation included three categories of workers: (1) government
employees, (2) supervisory employees, and (3) security guards. Lerum made of record the
explicit intent to repeal provisions of P.D. 442, the Labor Code. The provisions referred to were:
ART. 245. Security guards and other personnel employed for the protection and security of the
person, properties and premises of the employers shall not be eligible for membership in a labor
organization.
ART. 246. Managerial employees are not eligible to join, assist, and form any labor
organization.
[28]
28
Implications of the Lerum Proposal
In sum, Lerum's proposal to amend Art. III, 8 of the draft Constitution by including labor
unions in the guarantee of organizational right should be taken in the context of statements that
his aim was the removal of the statutory ban against security guards and supervisory employees
joining labor organizations. The approval by the Constitutional Commission of his proposal can
only mean, therefore, that the Commission intended the absolute right to organize of
government workers, supervisory employees, and security guards to be constitutionally
guaranteed. By implication, no similar absolute constitutional right to organize for labor
purposes should be deemed to have been granted to top-level and middle managers. As to
them the right of self-organization may be regulated and even abridged conformably to Art. III,
8.
Constitutionality of Art. 245
Finally, the question is whether the present ban against managerial employees, as embodied
in Art. 245 (which superseded Art. 246) of the Labor Code, is valid. This provision reads:
ART. 245. Ineligibility of managerial employees to join any labor organization; right of supervisory
employees. - Managerial employees are not eligible to join, assist or form any labor
organization. Supervisory employees shall not be eligible for membership in a labor
organization of the rank-and-fle employees but may join, assist or form separate labor
organizations of their own.
[29]
29
This provision is the result of the amendment of the Labor Code in 1989 by R.A. No. 6715,
otherwise known as the Herrera-Veloso Law. Unlike the Industrial Peace Act or the provisions
of the Labor Code which it superseded, R.A. No. 6715 provides separate defnitions of the terms
"managerial" and "supervisory employees," as follows:
ART. 212. Defnitions. . . .
(m) "managerial employee" is one who is vested with powers or prerogatives to lay
down and execute management policies and/or to hire transfer, suspend, lay of, recall,
discharge, assign or discipline employees. Supervisory employees are those who, in the interest
of the employer, efectively recommend such managerial actions if the exercise of such authority
is not merely routinary or clerical in nature but requires the use of independent judgment. All
employees not falling within any of the above defnitions are considered rank-and-fle
employees for purposes of this Book.
Although the defnition of "supervisory employees" seems to have been unduly restricted to
the last phrase of the defnition in the Industrial Peace Act, the legal signifcance given to the
phrase "efectively recommends" remains the same. In fact, the distinction between top and
middle managers, who set management policy, and front-line supervisors, who are merely
responsible for ensuring that such policies are carried out by the rank and fle, is articulated in
the present defnition.
[30]
30 When read in relation to this defnition in Art. 212(m), it will be
seen that Art. 245 faithfully carries out the intent of the Constitutional Commission in framing
Art. III, 8 of the fundamental law.
Nor is the guarantee of organizational right in Art. III, 8 infringed by a ban against
managerial employees forming a union. The right guaranteed in Art. III, 8 is subject to the
condition that its exercise should be for purposes "not contrary to law." In the case of Art. 245,
there is a rational basis for prohibiting managerial employees from forming or joining labor
organizations. As Justice Davide, Jr., himself a constitutional commissioner, said in
his ponencia in Philips Industrial Development, Inc. v. NLRC:
[31]
31
In the frst place, all these employees, with the exception of the service engineers and the sales
force personnel, are confdential employees. Their classifcation as such is not seriously disputed
by PEO-FFW; the fve (5) previous CBAs between PIDI and PEO-FFW explicitly considered
them as confdential employees. By the very nature of their functions, they assist and act in a
confdential capacity to, or have access to confdential matters of, persons who exercise
managerial functions in the feld of labor relations. As such, the rationale behind the
ineligibility of managerial employees to form, assist or joint a labor union equally applies to
them.
In Bulletin Publishing Co., Inc. v. Hon. Augusto Sanchez, this Court elaborated on this rationale,
thus:
". . . The rationale for this inhibition has been stated to be, because if these managerial
employees would belong to or be afliated with a Union, the latter might not be assured of their
loyalty to the Union in view of evident confict of interests. The Union can also become
company-dominated with the presence of managerial employees in Union membership."
[32]
To be sure, the Court in Philips Industrial was dealing with the right of confdential
employees to organize. But the same reason for denying them the right to organize justifes
even more the ban on managerial employees from forming unions. After all, those who qualify
as top or middle managers are executives who receive from their employers information that not
only is confdential but also is not generally available to the public, or to their competitors, or to
other employees. It is hardly necessary to point out that to say that the frst sentence of Art. 245
is unconstitutional would be to contradict the decision in that case.
WHEREFORE, the petition is DISMISSED.
SO ORDERED.
Narvasa, C.J., Regalado, Romero, Bellosillo, Martinez, and Purisima, JJ., concur.
Davide, Melo, Puno, Vitug, Kapunan, Panganiban, and Quisumbing, JJ., has separate,
concurring and dissenting opinion.
Ca&' No. 7
G.R. No. 93)*8 !'8'-.'/ 29, 199)
NATIONAL ASSOCIATION OF TRA!E 3NIONS (NAT3)%REP3LIC PLANTERS AN$
S3PERVISORS C;APTER,petitioner,
vs.
;ON. R3EN !. TORRES, SECRETARY OF LAOR AN! EMPLOYMENT a"# REP3LIC
PLANTERS AN$,respondents.
&ilemon -. "ercero or petitioner.
"(e -overnment Corporate Counsel or Republic Planters Ban$.

ELLOSILLO, J.:
/TI"/! SS"CITI"/ "+ TR-E I/I"/S (/TI$(REPI.!IC P!/TERS ./:
SIPERGIS"RS CDPTER see%s nullification of the decision of pu#lic respondent Secretary of
!a#or dated 1& 5arch 022*, 3hich 4odified the order of 5ed(r#iter 5anases T. Cru6 dated 0A
u7ust 02'2 as 3ell as his order dated 1* pril 022* denyin7 reconsideration.
"n 0A 5arch 02'2, /TI filed a petition for certification election to deter4ine the e=clusive
#ar7ainin7 representative of respondent .an%Hs e4ployees occupyin7 supervisory positions. "n 1)
pril 02'2, the .an% 4oved to dis4iss the petition on the 7round that the supposed supervisory
e4ployees 3ere actually 4ana7erial and>or confidential e4ployees thus ineli7i#le to ,oin, assist or
for4 a union, and that the petition lac%ed the 1*< si7natory re@uire4ent under the !a#or Code.
"n 0A u7ust 02'2, 5ed(r#iter 5anases T. Cru6 7ranted the petition thus B
CDERE+"RE, . . . let a certification election #e ordered conducted a4on7 all the
re7ular e4ployees of the Repu#lic Planters .an% occupyin7 supervisory positions or
the e@uivalent 3ithin 1* days fro4 receipt of a copy of this "rder. The choice shall
#e8 (0$ /ational ssociation of Trade Inions (/TI$(Repu#lic Planters .an%
Supervisors Chapter; and (1$ /o Inion.
The payroll three 4onths prior to the filin7 of this petition shall #e utili6ed in
deter4inin7 the list of eli7i#le voters . . . .
1
Respondent .an% appealed the order to the Secretary of !a#or on the 4ain 7round that several of
the e4ployees sou7ht to #e included in the certification election, particularly the -epart4ent
5ana7ers, .ranch 5ana7ers>"ICs, Cashiers and Controllers 3ere 4ana7erial and>or confidential
e4ployees and thus ineli7i#le to ,oin, assist or for4 a union. It presented anne=es detailin7 the ,o#
description and duties of the positions in @uestion and affidavits of certain e4ployees. It also invo%ed
provisions of the 9eneral .an%in7 ct and the Central .an% ct to sho3 the duties and
responsi#ilities of the #an% and its #ranches.
"n 1& 5arch 022*, pu#lic respondent issued a decision partially 7rantin7 the appeal, 3hich is no3
#ein7 challen7ed #efore us B
CDERE+"RE, . . . the appeal is here#y partially 7ranted. ccordin7ly, the "rder
dated 0A u7ust 02'2 is 4odified to the e=tent that -epart4ent 5ana7ers, ssistant
5ana7ers, .ranch 5ana7ers, Cashiers and Controllers are declared 4ana7erial
e4ployees. Perforce, they cannot ,oin the union of supervisors such as -ivision
Chiefs, ccounts "fficers, Staff ssistants and "ICHs (sic$ unless the latter are
re7ular 4ana7erial e4ployees . . . .
2
/TI filed a 4otion for reconsideration #ut the sa4e 3as denied on 1* pril 022*.
3
Dence this
recourse assailin7 pu#lic respondent for renderin7 the decision of 1& 5arch 022* and the order of 1* pril
022* #oth 3ith 7rave a#use of discretion.
The crucial issue presented for our resolution is 3hether the -epart4ent 5ana7ers, ssistant
5ana7ers, .ranch 5ana7ers>"ICs, Cashiers and Controllers of respondent .an% are 4ana7erial
and>or confidential e4ployees hence ineli7i#le to ,oin or assist the union of petitioner.
/TI su#4its that an analysis of the decision of pu#lic respondent readily yields certain fla3s that
result in erroneous conclusions. +irstly, a #ranch does not en,oy relative autono4y precisely
#ecause it is treated as one unit 3ith the head office and has to co4ply 3ith unifor4 policies and
7uidelines set #y the #an% itself. It 3ould #e a#surd if each #ranch of a particular #an% 3ould #e
adoptin7 and i4ple4entin7 different policies coverin7 4ultifarious #an%in7 transactions. 5oreover,
respondent .an%Hs o3n evidence clearly sho3s that policies and 7uidelines coverin7 the various
#ranches are set #y the head office. Secondly, there is a#solutely no evidence sho3in7 that #an%
policies are laid do3n throu7h the collective action of the .ranch 5ana7er, the Cashier and the
Controller. Thirdly, the or7ani6ational setup 3here the .ranch 5ana7er e=ercises control over
#ranch operations, the Controller controls the ccountin7 -ivision, and the Cashier controls the
Cash -ivision, is nothin7 #ut a proper delineation of duties and responsi#ilities. This delineation is a
Central .an% prescri#ed internal control 4easure intended to o#,ectively esta#lish responsi#ilities
a4on7 the officers to easily pinpoint culpa#ility in case of error. The ?dual control? and ?,oint custody?
aspects 4entioned in the decision of pu#lic respondent are li%e3ise internal control 4easures
prescri#ed #y the Central .an%.
/either is there evidence sho3in7 that su#,ect e4ployees are vested 3ith po3ers or prero7atives to
hire, transfer, suspend, lay off, recall, dischar7e, assi7n or discipline e4ployees. The #are
alle7ations in the affidavits of respondent .an%Hs E=ecutive ssistant to the President
)
and the Senior
5ana7er of the Du4an Resource 5ana7e4ent -epart4ent
(
that those po3ers and prero7atives are
inherent in su#,ect positions are self(servin7. Their clai4 cannot #e 4ade to prevail upon the actual duties
and responsi#ilities of su#,ect e4ployees.
The other evidence of respondent .an% 3hich purports to sho3 that su#,ect e4ployees e=ercise
4ana7erial functions even #elies such clai4. Insofar as -epart4ent 5ana7ers and ssistant
5ana7ers are concerned, there is a#solutely no reason 4entioned in the decision 3hy they are
4ana7erial e4ployees. /ot even respondent .an% in its appeal @uestioned the inclusion of ssistant
5ana7ers a4on7 the @ualified petitionin7 e4ployees. Pu#lic respondent has deviated fro4 the real
issue in this case, 3hich is, the deter4ination of 3hether su#,ect e4ployees are 4ana7erial
e4ployees 3ithin the conte4plation of the !a#or Code, as a4ended #y R 6A05; instead, he 4erely
concentrated on the nature, conduct and 4ana7e4ent of #an%s confor4a#ly 3ith the 9eneral
.an%in7 ct and the Central .an% ct.
Petitioner concludes that su#,ect e4ployees are not 4ana7erial e4ployees #ut supervisors. Even
assu4in7 that they are confidential e4ployees, there is no le7al prohi#ition a7ainst confidential
e4ployees 3ho are not perfor4in7 4ana7erial functions to for4 and ,oin a union.
"n the other hand, respondent .an% 4aintains that the -epart4ent 5ana7ers, .ranch 5ana7ers,
Cashiers and Controllers are inherently possessed of the po3ers enu4erated in rt. 101, par. (4$, of
the !a#or Code. It relies heavily on the affidavits of its E=ecutive ssistant to the President and
Senior 5ana7er of the Du4an Resource -epart4ent. The .ranch 5ana7ers, Cashiers and
Controllers are vested not only 3ith policy(4a%in7 po3ers necessary to run the affairs of the #ranch,
7iven the independence and relative autono4y 3hich it en,oys in the pursuit of its 7oals and
o#,ectives, #ut also 3ith the conco4itant disciplinary authority over the e4ployees.
The Solicitor 9eneral ar7ues that /TI loses si7ht of the fact that #y virtue of the appeal of
respondent .an%, the 3hole case is thro3n open for consideration #y pu#lic respondent. Even errors
not assi7ned in the appeal, such as the e=clusion #y the 5ed(r#iter of ssistant 5ana7ers fro4 the
4ana7erial e4ployees cate7ory, is 3ithin his discretion to consider as it is closely related to the
errors properly assi7ned. The fact that -epart4ent 5ana7ers are 4ana7erial e4ployees is #orne
out #y the evidence of petitioner itself. +urther4ore, 3hile it assails pu#lic respondentHs findin7 that
su#,ect e4ployees are 4ana7erial e4ployees, petitioner never @uestioned the fact that said officers
also occupy confidential positions and thus re4ain prohi#ited fro4 for4in7 or ,oinin7 any la#or
or7ani6ation.
Respondent .an% has no le7al personality to 4ove for the dis4issal of the petition for certification
election on the 7round that its supervisory e4ployees are in reality 4ana7erial e4ployees. n
e4ployer has no standin7 to @uestion the process since this is the sole concern of the 3or%ers. The
only e=ception is 3here the e4ployer itself has to file the petition pursuant to rt. 15' of the !a#or
Code #ecause of a re@uest to #ar7ain collectively.
*
Pu#lic respondent, invo%in7 R 6A05 and the inherent functions of -epart4ent 5ana7ers, ssistant
5ana7ers, .ranch 5ana7ers, Cashiers and Controllers, held that these officers properly fall 3ithin
the definition of 4ana7erial e4ployees. The ratiocination in his -ecision of 1& 5arch 022*
7
is that B
Repu#lic ct /o. 6A05, other3ise %no3n as the Derrera(Geloso !a3, restored the
ri7ht of supervisors to for4 their o3n unions 3hile 4aintainin7 the proscription on the
ri7ht to self(or7ani6ation of 4ana7erial e4ployees. ccordin7ly, the !a#or Code, as
a4ended, distin7uishes 4ana7erial, supervisory and ran%(and(file e4ployees thus8
rt. 101 (4$ B 3anagerial emplo!ee is one 3ho is vested 3ith
po3ers or prero7atives to lay do3n and e=ecute 4ana7e4ent
policies and>or to hire, transfer, suspend, lay(off, recall, dischar7e,
assi7n or discipline e4ployees. .upervisor! e4ployees are those
3ho, in the interest of the e4ployer, effectively reco44end such
4ana7erial actions, if the e=ercise of such 4ana7erial authority is not
routinary in nature #ut re@uires the use of independent ,ud74ent. All
emplo!ees not fallin7 3ithin any of the a#ove definitions are
considered ran%(and(file e4ployees (e4phasis supplied$.
t first 7lance, pursuant to the a#ove(definitions and #ased on their ,o# descriptions
as 7uideposts, there 3ould see4 to #e no difficulty in distin7uishin7 a 4ana7erial
e4ployee fro4 that of a supervisor, or fro4 that of a 4ere ran%(and(file e4ployee.
Eet, this tas% ta%es on a different di4ension 3hen applied to #an%s, particularly the
#ranches thereof. This is so #ecause unli%e ordinary corporations, a #an%Hs
or7ani6ational operation is 7overned and re7ulated #y the 9eneral .an%in7 ct and
the Central .an% ct, #oth special la3s . . . .
s pointed out #y the respondent, in the #an%in7 industry, a #ranch is the 4icrocos4
of a #an%in7 institution, uni@uely autono4ous and
self(7overnin7.
This relative autono4y of a #ranch finds le7al #asis in Section 1A of the 9eneral
.an%in7 ct, as a4ended, thus8
. . . . The #an% shall #e responsi#le for all #usiness conducted in such
#ranches to the sa4e e=tent and in the sa4e 4anner as thou7h such
#usiness had all #een conducted in the head office.
&or t(e purpose o t(is Act, a ban$ an) its branc(es s(all be treate)
as a unit (e4phasis supplied$.
Confor4a#ly 3ith the a#ove, #an% policies are laid do3n and>or e=ecuted throu7h
the collective action of the .ranch 5ana7er, Cashier and Controller at the #ranch
level. The .ranch 5ana7er e=ercises over(all control and supervision over #ranch
operation #ein7 on the top of the #ranchHs pyra4id structure. Do3ever, #oth the
controller and the cashier 3ho are called in #an%in7 parlance as ?+inancial
5ana7ers? due to their fiscal functions are 7iven such a share and sphere of
responsi#ility in the operations of the #an%. The cashier controls and supervises the
cash division 3hile the controller that of the ccountin7 -ivision. !i%e3ise, their
assi7ned tas% is of 7reat si7nificance, 3ithout 3hich a #an% or #ranch for that 4atter
cannot operate or function.
Throu7h the collective action of these three #ranch officers operational transactions
are carried out li%e8 The t3o (1$(si7nature re@uire4ent of the 4ana7er, on one hand,
and that of the controller or cashier on the other hand as re@uired in #an%Hs
issuances and releases. This is the so(called ?dual control? throu7h chec%(and(
#alance as prescri#ed #y the Central .an%, per Section 0066.6, .oo% I, 5anual of
Re7ulations for .an%s and +inancial Inter4ediaries. nother is in the ,oint custody of
the #ranchHs cash in vault, accounta#le for4s, collaterals, docu4ents of title, deposit,
led7ers and others, a4on7 the #ranch 4ana7er and at least t3o (1$ officers of the
#ranch as re@uired under Section 0066.6 of the 5anual of Re7ulations for .an%s and
"ther +inancial Inter4ediaries.
This structural set(up creates a tria) o managerial aut(orit! among t(e branc(
manager, cas(ier an) controller. Dence, no officer of the #an% ?. . . have (sic$
co4plete authority and responsi#ility for handlin7 all phases of any transaction fro4
#e7innin7 to end 3ithout so4e control or #alance fro4 so4e other part of the
or7ani6ation? (Section 0066.&, -ivision of -uties and Responsi#ilities, Ibi)$."(is
aspect in t(e ban$ing s!stem >(ic( calls or t(e )ivision o )uties an) responsibilities
is a clear maniestation o managerial po>er an) aut(orit!. /o operational
transaction at #ranch level is carried out #y the sin7ular act of the .ranch 5ana7er
#ut rather throu7h the collective act of the .ranch 5ana7er, Cashier>Controller
(e4phasis supplied$.
/ote3orthy is the ?on call client? set up in #an%s. Inder this sche4e, the #ranch
4ana7er is tas%ed 3ith the responsi#ility of #usiness develop4ent and 4ar%etin7 of
the #an%Hs services 3hich place hi4 on client call. -urin7 such usual physical
a#sences fro4 the #ranch, the cashier assu4es the reins of #ranch control and
ad4inistration. "n those occasions, the ?dual control syste4? is clearly 4anifest in
the transactions and operations of the #ranch #an% as it 3ill then re@uire the
necessary ,oint action of the controller and the cashier.
The 7rave a#use of discretion co44itted #y pu#lic respondent is at once apparent. rt. 101, par.
(4$, of the !a#or Code is e=plicit. 4ana7erial e4ployee is (a$ one 3ho is vested 3ith po3ers or
prero7atives to lay do3n and e=ecute 4ana7e4ent policies, or to hire, transfer, suspend, lay off,
recall, dischar7e, assi7n or discipline e4ployees; or (#$ one 3ho is vested 3ith #oth po3ers or
prero7atives. supervisory e4ployee is different fro4 a 4ana7erial e4ployee in the sense that the
supervisory e4ployee, in the interest of the e4ployer, eectivel! recommen)s such 4ana7erial
actions, if the e=ercise of such 4ana7erial authority is not routinary in nature #ut re@uires the use of
independent ,ud74ent.
Ran7ed a7ainst these definitions and after a thorou7h e=a4ination of the evidence su#4itted #y
#oth parties, 3e arrive at a contrary conclusion. .ranch 5ana7ers, Cashiers and Controllers of
respondent .an% are not 4ana7erial e4ployees #ut supervisory e4ployees. The findin7 of pu#lic
respondent that #an% policies are laid do3n and>or e=ecuted throu7h the collective action of these
e4ployees is si4ply erroneous. Dis discussion on the division of their duties and responsi#ilities
does not lo7ically lead to the conclusion that they are 4ana7erial e4ployees, as the ter4 is defined
in rt. 101, par. (4$.
4on7 the 7eneral duties and responsi#ilities of a .ranch 5ana7er is ?LtMo dischar7e his duties and
authority 3ith a hi7h sense of responsi#ility and inte7rity and shall at all ti4es #e 7uided #y prudence
li%e a 7ood father of the fa4ily, and sound ,ud74ent in accor)ance >it( an) >it(in t(e limitations o
t(e polic!Dpolicies promulgate) b! t(e Boar) o %irectors an) implemente) b! t(e 3anagement until
suspended, superseded, revo%ed or 4odified? (par. 5, e4phasis supplied$.
8
Si4ilarly, the ,o#
su44ary of a Controller states8 ?Supervises the ccountin7 Init of the #ranch;sees to t(e compliance b!
t(e Branc( >it( establis(e) proce)ures, policies, rules an) regulations o t(e Ban$ an) e2ternal
supervising aut(orities; sees to the strict i4ple4entation of control procedures (e4phasis supplied$.
9
The
,o# description of a Cashier does not 4ention any authority on his part to lay do3n policies, either.
15
"n
the #asis of the fore7oin7 evidence, it is clear that su#,ect e4ployees do not participate in policy(4a%in7
#ut are 7iven approved and esta#lished policies to e=ecute and standard practices to o#serve,
11
leavin7
little or no discretion at all 3hether to i4ple4ent said policies or not.
12
It is the nature of the e4ployeeHs
functions, and not the no4enclature or title 7iven to his ,o#, 3hich deter4ines 3hether he has ran%(and(
file, supervisory or 4ana7erial status.
13
5oreover, the #are state4ent in the affidavit of the E=ecutive ssistant to the President of
respondent .an% that the .ranch 5ana7ers, Cashiers and Controllers ?for4ulate and i4ple4ent the
plans, policies and 4ar%etin7 strate7ies of the #ranch to3ards the successful acco4plish4ent of its
profit tar7ets and o#,ectives,?
1)
is contradicted #y the follo3in7 evidence su#4itted #y respondent .an%
itself8
(a$ 5e4orandu4 issued #y respondent .an%Hs ssistant Gice President to all
Re7ional 5ana7ers and .ranch 5ana7ers 7ivin7 the4 te4porary discretionary
authority to 7rant additional interest over the prescri#ed #oard rates for #oth short(
ter4 and lon7(ter4 CT-s su#,ect, ho3ever, to specific li4itations and 7uidelines set
forth in the sa4e 4e4orandu4;
1(
(#$ 5e4orandu4 issued #y respondent .an%Hs E=ecutive Gice President to all Re7ional
5ana7ers and .ranch "fficers re7ardin7 the policy and 7uidelines on dra3in7 a7ainst
uncollected deposits (-I-$;
1*
(c$ 5e4orandu4 issued #y respondent .an%Hs President to all +ield "ffices re7ardin7 the
7uidelines on do4estic #ills purchased
(-.P$;
17
and
(d$ 5e4orandu4 issued #y the sa4e officer to all .ranch 5ana7ers re7ardin7
lendin7 authority at the #ranch level and the ter4s and conditions thereof.
18
s a conse@uence, the affidavit of the E=ecutive ssistant cannot #e 7iven any 3ei7ht at all.
/either do the .ranch 5ana7ers, Cashiers and Controllers have the po3er to hire, transfer,
suspend, lay off, recall, dischar7e, assi7n or discipline e4ployees. The Senior 5ana7er of the
Du4an Resource 5ana7e4ent -epart4ent of respondent .an%, in her affidavit, stated that ?the
po3er to hire, fire, suspend, transfer, assi7n or other3ise i4pose discipline a4on7 su#ordinates
3ithin their respective ,urisdictions is lod7ed 3ith the heads of the various depart4ents, the #ranch
4ana7ers and officers(in(char7e, the #ranch cashiers and the #ranch controllers. Inherent as it is in
the afore4entioned positions, the authority to hire, fire, suspend, transfer, assi7n or other3ise
discipline e4ployees 3ithin their respective do4ains 3as dee4ed unnecessary to #e incorporated in
their individual ,o# descriptions; .y 3ay of illustration, on u7ust 1), 02'2, 5r. Renato . Tuates, the
"fficer(in(Char7e>.ranch Cashier of the .an%Hs -u4a7uete .ranch, placed under preventive
suspension and thereafter ter4inated the teller of the sa4e #ranch . . . . !i%e3ise, on +e#ruary 11,
02'2, 5r. +rancis -. Ro#ite, Sr., the "fficer(in(Char7e of International -epart4ent, assi7ned the
ca#le assistant of the International -epart4ent as the concurrent +C-I ccounta#le +or4s
Custodian.?
19
Do3ever, a close scrutiny of the 4e4orandu4 of 5r. Tuates reveals that he does not have said
4ana7erial po3er #ecause as plainly stated therein, it 3as issued ?upon instruction fro4 Dead
"ffice.?
25
Cith re7ard to the 4e4orandu4 of 5r. Ro#ite, Sr., it appears that the po3er he e=ercised 3as
4erely in an isolated instance, ta%in7 into account the other evidence su#4itted #y respondent .an% itself
sho3in7 lac% of said po3er #y other .ranch 5ana7ers>"ICs8
(a$ 5e4orandu4 fro4 the .ranch 5ana7er for the
GP(5anpo3er 5ana7e4ent -epart4ent e=pressin7 the opinion that a certain
e4ployee, due to ha#itual a#senteeis4 and tardiness, 4ust #e penali6ed in
accordance 3ith respondent .an%Hs Code of -iscipline; and
(#$ 5e4orandu4 fro4 a .ranch "IC for the ssistant Gice President reco44endin7
a certain e4ployeeHs pro4otional ad,ust4ent to the present position he occupies.
Clearly, those officials or e4ployees possess only reco44endatory po3ers su#,ect to evaluation,
revie3 and final action #y hi7her officials. Therefore, the fore7oin7 affidavit cannot #olster the stand
of respondent .an%.
The positions of -epart4ent 5ana7ers and ssistant 5ana7ers 3ere also declared #y pu#lic
respondent as 4ana7erial, 3ithout providin7 any #asis therefor. Petitioner asserts that the position of
ssistant 5ana7er 3as not even included in the appeal filed #y respondent .an%. Chile 3e a7ree
3ith the "ffice of the Solicitor 9eneral that it is 3ithin the discretion of pu#lic respondent to consider
an unassi7ned issue that is closely related to an issue properly assi7ned, still, pu#lic respondentHs
error lies in the fact that his findin7 has no le7 to stand on. ny3ay, inas4uch as the entire records
are #efore us, no3 is the opportunity to discuss this issue.
Ce analy6ed the evidence su#4itted #y respondent .an% in support of its clai4 that -epart4ent
5ana7ers are 4ana7erial e4ployees
21
and concluded that they are not. !i%e .ranch 5ana7ers,
Cashiers and Controllers, -epart4ent 5ana7ers do not possess the po3er to lay do3n policies nor to
hire, transfer, suspend, lay off, recall, dischar7e, assi7n or discipline e4ployees. They occupy supervisory
positions, char7ed 3ith the duty a4on7 others to ?reco44end proposals to i4prove and strea4line
operations.?
22
Cith respect to ssistant 5ana7ers, there is a#solutely no evidence su#4itted to
su#stantiate pu#lic respondentHs findin7 that they are 4ana7erial e4ployees; understanda#ly so, #ecause
this position is not included in the appeal of respondent .an%.
s re7ards the other clai4 of respondent .an% that .ranch 5ana7ers>"ICs, Cashiers and
Controllers are confidential e4ployees, havin7 control, custody and>or access to confidential
4atters, e.7., the #ranchHs cash position, state4ents of financial condition, vault co4#ination, cash
codes for tele7raphic transfers, de4and drafts and other ne7otia#le instru4ents,
23
pursuant to Sec.
0066.) of the Central .an% 5anual re7ardin7 ,oint custody,
2)
this clai4 is not even disputed #y petitioner.
confidential e4ployee is one entrusted 3ith confidence on delicate 4atters, or 3ith the custody,
handlin7, or care and protection of the e4ployerHs property.
2(
Chile rt. 1)5 of the !a#or Code sin7les out
4ana7erial e4ployees as ineli7i#le to ,oin, assist or for4 any la#or or7ani6ation, under the )octrine o
necessar! implication, confidential e4ployees are si4ilarly dis@ualified. This doctrine states that 3hat is
i4plied in a statute is as 4uch a part thereof as that 3hich is e=pressed, as elucidated in several
cases
2*
the latest of 3hich is C(ua v. Civil .ervice Commission
27
3here 3e said8
/o statute can #e enacted that can provide all the details involved in its application.
There is al3ays an o4ission that 4ay not 4eet a particular situation. Chat is
thou7ht, at the ti4e of enact4ent, to #e an all(e4#racin7 le7islation 4ay #e
inade@uate to provide for the unfoldin7 events of the future. So(called 7aps in the la3
develop as the la3 is enforced. "ne of the rules of statutory construction used to fill
in the 7ap is the doctrine of necessary i4plication . . . . Every statute is understood,
#y i4plication, to contain all such provisions as 4ay #e necessary to effectuate its
o#,ect and purpose, or to 4a%e effective ri7hts, po3ers, privile7es or ,urisdiction
3hich it 7rants, includin7 all such collateral and su#sidiary conse@uences as 4ay #e
fairly and lo7ically inferred fro4 its ter4s. E2 necessitate
legis . . . .
In applyin7 the )octrine o necessar! implication, 3e too% into consideration the rationale #ehind the
dis@ualification of 4ana7erial e4ployees e=pressed in Bulletin Publis(ing Corporation v.
.anc(e,,
28
thus8 ?. . . if these 4ana7erial e4ployees 3ould #elon7 to or #e affiliated 3ith a Inion, the
latter 4i7ht not #e assured of their loyalty to the Inion in vie3 of evident conflict of interests. The Inion
can also #eco4e co4pany(do4inated 3ith the presence of 4ana7erial e4ployees in Inion
4e4#ership.? Stated differently, in the collective #ar7ainin7 process, 4ana7erial e4ployees are
supposed to #e on the side of the e4ployer, to act as its representatives, and to see to it that its interests
are 3ell protected. The e4ployer is not assured of such protection if these e4ployees the4selves are
union 4e4#ers. Collective #ar7ainin7 in such a situation can #eco4e one(sided.
29
It is the sa4e reason
that i4pelled this Court to consider the position of confidential e4ployees as included in the
dis@ualification found in rt. 1)5 as if the dis@ualification of confidential e4ployees 3ere 3ritten in the
provision. If confidential e4ployees could unioni6e in order to #ar7ain for advanta7es for the4selves, then
they could #e 7overned #y their o3n 4otives rather than the interest of the e4ployers. 5oreover,
unioni6ation of confidential e4ployees for the purpose of collective #ar7ainin7 3ould 4ean the e=tension
of the la3 to persons or individuals 3ho are supposed to act ?in the interest of? the e4ployers.
35
It is not
farfetched that in the course of collective #ar7ainin7, they 4i7ht ,eopardi6e that interest 3hich they are
duty(#ound to protect. lon7 the sa4e line of reasonin7 3e held in -ol)en &arms, Inc. v. &errer-
Calle#a
31
reiterated in P(ilips In)ustrial %evelopment, Inc. v. +LRC,
32
that ?confidential e4ployees such as
accountin7 personnel, radio and tele7raph operators 3ho, havin7 access to confidential infor4ation, 4ay
#eco4e the source of undue advanta7e. Said e4ployee(s$ 4ay act as spy or spies of either party to a
collective #ar7ainin7 a7ree4ent.?
In fine, only the .ranch 5ana7ers>"ICs, Cashiers and Controllers of respondent .an%, #ein7
confidential e4ployees, are dis@ualified fro4 ,oinin7 or assistin7 petitioner Inion, or ,oinin7,
assistin7 or for4in7 any other la#or or7ani6ation. .ut this rulin7 should #e understood to apply only
to the present case #ased on the evidence of the parties, as 3ell as to those si4ilarly situated. It
should not #e understood in any 3ay to apply to #an%s in 7eneral.
CDERE+"RE, the petition is partially 9R/TE-. The decision of pu#lic respondent Secretary of
!a#or dated 1& 5arch 022* and his order dated 1* pril 022* are 5"-I+IE-, here#y declarin7 that
only the .ranch 5ana7ers>"ICs, Cashiers and Controllers of respondent Repu#lic Planters .an%
are ineli7i#le to ,oin or assist petitioner /ational ssociation of Trade Inions (/TI$(Repu#lic
Planters .an% Supervisors Chapter, or ,oin, assist or for4 any other la#or or7ani6ation.
S" "R-ERE-.
%avi)e, *r., Guiason an) Hapunan, **., concur.



S'+a/a,' O+6"6o"&

PA!ILLA, J., concurrin7 and dissentin78
I concur in the 4a,ority opinionHs conclusion that respondent .an%Hs .ranch 5ana7ers>"ICs,
Cashiers and Controllers, #ein7 confidential e4ployees of the .an%, are dis@ualified fro4 ,oinin7 or
assistin7 petitioner la#or union or ,oinin7, assistin7 or for4in7 any other la#or or7ani6ation, includin7
a supervisorHs union.
Do3ever, I dissent fro4 its conclusion that respondent .an%Hs -epart4ent 5ana7ers and
-epart4ent ssistant 5ana7ers are not dis@ualified fro4 ,oinin7 a la#or union includin7 a
supervisorsH union. 5y years of e=perience in the #an%in7 industry (perhaps irrelevant to this case$
have sho3n that positions of such -epart4ent Deads (5ana7ers$ are as confidential, if not 4ore,
than the position of .ranch 5ana7ers. In fact, 4ost of such -epart4ent Deads are Gice(Presidents
of the .an%, 3hich underscores their status #oth as 4ana7erial e4ployees and confidential
personnel of the .an%. It 3ould #e incon7ruous for a -epart4ent 5ana7er 3ho, as already stated, is
usually a Gice(President, to #e a 4e4#er of the sa4e la#or or7ani6ation as his 4essen7er or
supervisory account e=ecutives. It 3ould #e even 4ore untena#le and dan7erous for a -epart4ent
5ana7er 3ho usually is a Gice(President, #ein7 a 4e4#er of a la#or union, to #e desi7nated a union
representative for purposes of collective #ar7ainin7 3ith the 4ana7e4ent of 3hich he is a part. I
thin% the pu#lic respondent is correct in dis@ualifyin7 fro4 4e4#ership in a la#or union of
supervisors, those 3ho are -epart4ent 5ana7ers and ssistant 5ana7ers.
I, therefore, vote for the affir4ance in toto of pu#lic respondentHs decision of 1& 5arch 022* and
order of 1* pril 022*.

A S'+a/a,' O+6"6o"&

PA!ILLA, J., concurrin7 and dissentin78
I concur in the 4a,ority opinionHs conclusion that respondent .an%Hs .ranch 5ana7ers>"ICs,
Cashiers and Controllers, #ein7 confidential e4ployees of the .an%, are dis@ualified fro4 ,oinin7 or
assistin7 petitioner la#or union or ,oinin7, assistin7 or for4in7 any other la#or or7ani6ation, includin7
a supervisorHs union.
Do3ever, I dissent fro4 its conclusion that respondent .an%Hs -epart4ent 5ana7ers and
-epart4ent ssistant 5ana7ers are not dis@ualified fro4 ,oinin7 a la#or union includin7 a
supervisorsH union. 5y years of e=perience in the #an%in7 industry (perhaps irrelevant to this case$
have sho3n that positions of such -epart4ent Deads (5ana7ers$ are as confidential, if not 4ore,
than the position of .ranch 5ana7ers. In fact, 4ost of such -epart4ent Deads are Gice(Presidents
of the .an%, 3hich underscores their status #oth as 4ana7erial e4ployees and confidential
personnel of the .an%. It 3ould #e incon7ruous for a -epart4ent 5ana7er 3ho, as already stated, is
usually a Gice(President, to #e a 4e4#er of the sa4e la#or or7ani6ation as his 4essen7er or
supervisory account e=ecutives. It 3ould #e even 4ore untena#le and dan7erous for a -epart4ent
5ana7er 3ho usually is a Gice(President, #ein7 a 4e4#er of a la#or union, to #e desi7nated a union
representative for purposes of collective #ar7ainin7 3ith the 4ana7e4ent of 3hich he is a part. I
thin% the pu#lic respondent is correct in dis@ualifyin7 fro4 4e4#ership in a la#or union of
supervisors, those 3ho are -epart4ent 5ana7ers and ssistant 5ana7ers.
I, therefore, vote for the affir4ance in toto of pu#lic respondentHs decision of 1& 5arch 022* and
order of 1* pril 022*.
+IRST -IGISI"/
BG.R. No. 1588((. F'./7a/y 28, 199*C
METROLA IN!3STRIES, INC., petitioner, vs. ;ONORALE MA.
NIEVES ROL!AN%CONFESOR, 6" :'/ 8a+a86,y a& S'8/',a/y o4
,:' !'+a/,-'", o4 La.o/ a"# E-+9oy-'", a"# METRO !R3G
CORPORATION EMPLOYEES ASSOCIATION%FE!ERATION OF
FREE 1OR$ERS, respondents.
SYLLA3S
0. REME!IAL LA1D EVI!ENCED FIN!INGS OF FACT OF A!MINISTRATIVE
AGENCIESD R3LED CASE AT AR. % Ce reaffir4 the doctrine that considerin7
their e=pertise in their respective fields, factual findin7s of ad4inistrative a7encies
supported #y su#stantial evidence are accorded 7reat respect and #inds this
Court. The Secretary of !a#or ruled, thus8 = = = ny act co44itted durin7 the
pendency of the dispute that tends to 7ive rise to further contentious issues or
increase the tensions #et3een the parties should #e considered an act of
e=acer#ation. "ne 4ust loo% at the act itself, not on speculative reactions.
4isplaced recourse is not needed to prove that a dispute has #een e=acer#ated.
+or instance, the Inion could not #e e=pected to file another notice of stri%e. +or
this 3ould depart fro4 its theory of the case that the layoff is su#su4ed under the
instant dispute, for 3hich a notice of stri%e had already #een filed. "n the other
hand, to e=pect violent reactions, unruly #ehavior, and any other chaotic or drastic
action fro4 the Inion is to e=pect it to co44it acts disruptive of pu#lic order or acts
that 4ay #e ille7al. Inder a re7i4e of la3s, le7al re4edies ta%e the place of violent
ones. = == Protest a7ainst the su#,ect layoffs need not #e in the for4 of violent
action or any other drastic 4easure. In the instant case the Inion re7istered their
dissent #y s3iftly filin7 a 4otion for a cease and desist order. Contrary to
petitionerOs alle7ations, the Inion stron7ly conde4ned the layoffs and threatened
4ass action if the Secretary of !a#or fails to ti4ely intervene8 = = = &. This unilateral
action of 4ana7e4ent is a #latant violation of the in,unction of this "ffice a7ainst
co44ittin7 acts 3hich 3ould e=acer#ate the dispute. Inless such act is en,oined
the Inion 3ill #e co4pelled to resort to its le7al ri7ht to 4ass actions and concerted
activities to protest and stop the said 4ana7e4ent action. This 4ass layoff is
clearly one 3hich 3ould result in a very serious dispute unless this "ffice s3iftly
intervenes. = = = 5etrola# and the Inion 3ere still in the process of resolvin7 their
C. deadloc% 3hen petitioner i4ple4ented the su#,ect layoffs. s a result,
4otions and oppositions 3ere filed divertin7 the partiesO attention, delayin7
resolution of the #ar7ainin7 deadloc% and postponin7 the si7nin7 of their ne3 C.,
there#y a77ravatin7 the 3hole conflict.
1. LAOR AN! SOCIAL LEGISLATIOND TERMINATION OF EMPLOYMENTD
EEERCISE OF MANAGEMENT PREROGATIVESD NOT ASOL3TED S3JECT
TO EECEPTIONS IMPOSE! Y LA1. % This Court reco7ni6es the e=ercise of
4ana7e4ent prero7atives and often declines to interfere 3ith the le7iti4ate
#usiness decisions of the e4ployer. Do3ever, this privile7e is not a#solute #ut
su#,ect to li4itations i4posed #y la3. In PAL vs. +LRC, I;;: SCR &*0 L022&M$, 3e
issued this re4inder8 ... the e=ercise of 4ana7e4ent prero7atives 3as never
considered #oundless. Thus, in Cru, vs. 3e)ina (0AA SCR :<: L02'2M$, it 3as
held that 4ana7e4entOs prero7atives 4ust #e 3ithout a#use of discretion ...All t(is
points to t(e conclusion t(at t(e e2ercise o managerial prerogatives is not
unlimite). It is circumscribe) b! limiIations oun) in la>, a collective bargaining
agreement, or t(e general principles o air pla! an) #ustice IUniversit! o .to.
"omas v. +LRC, 02* SCR A5' L022*M$.
&. I!.D I!.D I!.D I!.D I!.D CASE AT AR AN EECEPTION. % The case at #ench
constitutes one of the e=ceptions. The Secretary of !a#or is e=pressly 7iven the
po3er under the !a#or Code to assu4e ,urisdiction and resolve la#or disputes
involvin7 industries indispensa#le to national interest. The disputed in,unction is
su#su4ed under this special 7rant of authority. rt. 16& (7$ of the !a#or Code
specifically provides that8 = = = (7$ Chen, in his opinion, there e=ists a la#or dispute
causin7 or li%ely to cause a stri%e or loc%out in an industry indispensa#le to the
national interest, the Secretary of !a#or and E4ploy4ent 4ay assu4e ,urisdiction
over the dispute and decide it or certify the sa4e to the Co44ission for co4pulsory
ar#itration. Such assu4ption or certification shall have the effect of auto4atically
en,oinin7 the intended or i4pendin7 stri%e or loc%out as specified in the assu4ption
or certification order. If one has already ta%en place at the ti4e of assu4ption or
certification, all stri%in7 or loc%ed out e4ployees shall i44ediately return to 3or%
and the e4ployer shall i44ediately resu4e operations and read4it all 3or%ers
under the sa4e ter4s and conditions prevailin7 #efore the stri%e or loc%out. The
Secretary of !a#or and E4ploy4ent or the Co44ission 4ay see% the assistance of
la3 enforce4ent a7encies to ensure co4pliance 3ith this provision as >ell as >it(
suc( or)ers as (e ma! issue to enorce t(e same. . . . That 5etrola#Os #usiness is
of national interest is not disputed. 5etrola# is one of the leadin7 4anufacturers and
suppliers of 4edical and phar4aceutical products to the country. 5etrola#Os
4ana7e4ent prero7atives, therefore, are not #ein7 un,ustly curtailed #ut duly
#alanced 3ith and te4pered #y the li4itations set #y la3, ta%in7 into account its
special character and the particular circu4stances in the case at #ench.
). I!.D LAOR RELATIONSD INELIGIILITY OF MANAGERIAL EMPLOYEES TO
JOIN, FORM AN! ASSIST ANY LAOR ORGANI0ATIOND PRO;IITION
EETEN!E! TO CONFI!ENTIAL EMPLOYEES. % lthou7h rticle 1)5 of the !a#or
Code li4its the ineli7i#ility to ,oin, for4 and assist any la#or or7ani6ation to
4ana7erial e4ployees, ,urisprudence has e=tended this prohi#ition to confidential
e4ployees or those 3ho #y reason of their positions or nature of 3or% are re@uired
to assist or act in a fiduciary 4anner to 4ana7erial e4ployees and hence, are
li%e3ise privy to sensitive and hi7hly confidential records.
5. I!.D I!.D EECL3SION OF CONFI!ENTIAL EMPLOYEES FROM T;E RAN$ AN!
FILE ARGAINING 3NITD NOT TANTAMO3NT TO !ISCRIMINATION.
% Confidential e4ployees cannot #e classified as ran% and file. s previously
discussed, the nature of e4ploy4ent of confidential e4ployees is @uite distinct fro4
the ran% and file, thus, 3arrantin7 a separate cate7ory. E=cludin7 confidential
e4ployees fro4 the ran% and file #ar7ainin7 unit, therefore, is not tanta4ount to
discri4ination.
APPEARANCES OF CO3NSEL
Bautista Pica,o Bu!co "an / &i)er for petitioner.
"(e .olicitor -eneral for pu#lic respondent.
Perecto 6. &ernan)e,, *ose P. &ernan)e, / Cristobal P. &ernan)e, for 5etro -ru7
Corporation.
! E C I S I O N
$AP3NAN, J.F
This is a petition for certiorari under Rule 65 of the Revised Rules of Court see%in7
the annul4ent of the Resolution and "4ni#us Resolution of the Secretary of !a#or and
E4ploy4ent dated 0) pril 0221 and 15 January 022&, respectively, in "S(J(*))20(00
(/C5.(/CR(/S(*'(525(2 0; /C5.(/CR(/S(*2(6A'(20$ on 7rounds that these 3ere
issued 3ith 7rave a#use of discretion and in e=cess of ,urisdiction.
Private respondent 5etro -ru7 Corporation E4ployees ssociation(+ederation of
+ree Cor%ers (hereinafter referred to as the Inion$ is a la#or or7ani6ation representin7
the ran% and file e4ployees of petitioner 5etrola# Industries, Inc. (hereinafter referred to
as 5etrola#>5II$ and also of 5etro -ru7, Inc.
"n &0 -ece4#er 022*, the Collective .ar7ainin7 7ree4ent (C.$ #et3een
5etrola# and the Inion e=pired. The ne7otiations for a ne3 C., ho3ever, ended in a
deadloc%.
Conse@uently, on 1& u7ust 0220, the Inion filed a notice of stri%e a7ainst 5etrola#
and 5etro -ru7 Inc. The parties failed to settle their dispute despite the conciliation
efforts of the /ational Conciliation and 5ediation .oard.
To contain the escalatin7 dispute, the then Secretary of !a#or and E4ploy4ent,
Ru#en -. Torres, issued an assu4ption order dated 1* Septe4#er 0220, the dispositive
portion of 3hich reads, thus8
WHEREFORE, PREMISES CONSIDERED, and pursuant to Article 26 !"# o$ t%e
&a'or Code, as a(ended, t%is O$$ice %ere') assu(es *urisdiction o+er t%e entire la'or
dispute at Metro Dru", Inc, - Metro Dru" Distri'ution Di+ision and Metrola'
Industries Inc,
Accordingly, any strike or lockout is hereby strictly enjoined. The Companies and the
Metro Drug Corp. Employees Association - FF are like!ise directed to cease and
desist "rom committing any and all acts that might e#acerbate the situation.
Finall), t%e parties are directed to su'(it t%eir position papers and e+idence on t%e
a$ore.uoted deadloc/ed issues to t%is o$$ice 0it%in t0ent) !21# da)s $ro( receipt
%ereo$,
SO ORDERED,
234
!Italics ours,#
"n 1A -ece4#er 0220, then !a#or Secretary Torres issued an order resolvin7 all
the disputed ite4s in the C. and ordered the parties involved to e=ecute a ne3 C..
Thereafter, the Inion filed a 4otion for reconsideration.
"n 1A January 0221, durin7 the pendency of the a#ove4entioned 4otion for
reconsideration, 5etrola# laid off 2) of its ran% and file e4ployees.
"n the sa4e date, the Inion filed a 4otion for a cease and desist order to en,oin
5etrola# fro4 i4ple4entin7 the 4ass layoff, alle7in7 that such act violated the
prohi#ition a7ainst co44ittin7 acts that 3ould e=acer#ate the dispute as specifically
directed in the assu4ption order.
L1M
"n the other hand, 5etrola# contended that the layoff 3as te4porary and in the
e=ercise of its 4ana7e4ent prero7ative. It 4aintained that the co4pany 3ould suffer a
yearly 7ross revenue loss of appro=i4ately si=ty(si= (66$ 4illion pesos due to the
3ithdra3al of its principals in the Toll and Contract 5anufacturin7 -epart4ent. 5etrola#
further asserted that 3ith the auto4ation of the 4anufacture of its product PEs%inol,Q the
nu4#er of 3or%ers re@uired its production is si7nificantly reduced.
L&M
Thereafter, on various dates, 5etrola# recalled so4e of the laid off 3or%ers on a
te4porary #asis due to availa#ility of 3or% in the production lines.
"n 0) pril 0221, ctin7 !a#or Secretary /ieves Confesor issued a resolution
declarin7 the layoff of 5etrola#Os 2) ran% and file 3or%ers ille7al and ordered their
reinstate4ent 3ith full #ac%3a7es. The dispositive portion reads as follo3s8
WHEREFORE, t%e 5nion6s (otion $or reconsideration is "ranted in part, and our
order o$ 27 Dece('er 3883 is a$$ir(ed su'*ect to t%e (odi$ications in allo0ances and
in t%e close s%op pro+ision, 9%e la)o$$ o$ t%e 8: e(plo)ees at MII is %ere') declared
ille"al $or t%e $ailure o$ t%e latter to co(pl) 0it% our in*unction a"ainst co((ittin"
an) act 0%ic% (a) e;acer'ate t%e dispute and 0it% t%e 1-da) notice
re.uire(ent, Accordin"l), MII is %ere') ordered to reinstate t%e 8: e(plo)ees,
e;cept t%ose 0%o %a+e alread) 'een recalled, to t%eir $or(er positions or su'stantiall)
e.ui+alent, positions 0it% $ull 'ac/0a"es $ro( t%e date t%e) 0ere ille"all) laid o$$ on
2< =anuar) 3882 until actuall) reinstated 0it%out loss o$ seniorit) ri"%ts and ot%er
'ene$its, Issues relati+e to t%e C>A a"reed upon ') t%e parties and not e('odied in
our earlier order are %ere') ordered adopted $or incorporation in t%e C>A, Furt%er, t%e
dispositions and directi+es contained in all pre+ious orders and resolutions relati+e to
t%e instant dispute, inso$ar as not inconsistent %erein, are reiterated, Finall), t%e parties
are en*oined to cease and desist $ro( co((ittin" an) act 0%ic% (a) tend to
circu(+ent t%is resolution,
SO RESO&?ED,
2:4
"n 6 5arch 0221, 5etrola# filed a Partial 5otion for Reconsideration alle7in7 that
the layoff did not a77ravate the dispute since no unto3ard incident occurred as a result
thereof. It, li%e3ise, filed a 4otion for clarification re7ardin7 the constitution of the
#ar7ainin7 unit covered #y the C..
"n 12 June 0221, after e=haustive ne7otiations, the parties entered into a ne3
C.. The e=ecution, ho3ever, 3as 3ithout pre,udice to the outco4e of the issues
raised in the reconsideration and clarification 4otions su#4itted for decision to the
Secretary of !a#or.
L5M
Pendin7 the resolution of the aforestated 4otions, on 1 "cto#er 0221, 5etrola# laid
off A& of its e4ployees on 7rounds of redundancy due to lac% of 3or% 3hich the Inion
a7ain pro4ptly opposed on 5 "cto#er 0221.
"n 05 "cto#er 0221, !a#or Secretary Confesor a7ain issued a cease and desist
order. 5etrola# 4oved for a reconsideration.
L6M
"n 15 January 022&, !a#or Secretary Confesor issued the assailed "4ni#us
Resolution containin7 the follo3in7 orders8
=== === ===.
3, MII6s (otion $or partial reconsideration o$ our 3: April 3882 resolution speci$icall)
t%at portion t%ereo$ assailin" our rulin" t%at t%e la)o$$ o$ t%e 8: e(plo)ees is ille"al,
is %ere') denied, MII is %ere') ordered to pa) suc% e(plo)ees t%eir $ull 'ac/0a"es
co(puted $ro( t%e ti(e o$ actual la)o$$ to t%e ti(e o$ actual recall@
2, For t%e parties to incorporate in t%eir respecti+e collecti+e 'ar"ainin" a"ree(ents
t%e clari$ications %erein contained@ and
, MII6s (otion $or reconsideration 0it% respect to t%e conse.uences o$ t%e second
0a+e o$ la)o$$ a$$ectin" < e(plo)ees, to t%e e;tent o$ assailin" our rulin" t%at suc%
la)o$$ tended to e;acer'ate t%e dispute, is %ere') denied, >ut inas(uc% as t%e le"alit)
o$ t%e la)o$$ 0as not su'(itted $or our resolution and no e+idence %ad 'een adduced
upon 0%ic% a cate"orical $indin" t%ereon can 'e 'ased, t%e sa(e is %ere') re$erred to
t%e N&RC $or its appropriate action,
Finall), all pro%i'itor) in*unctions issued as a result o$ our assu(ption o$ *urisdiction
o+er t%is dispute are %ere') li$ted,
SO RESO&?ED,
2<4
!a#or Secretary Confesor also ruled that e=ecutive secretaries are e=cluded fro4
the closed(shop provision of the C., not fro4 the #ar7ainin7 unit.
"n ) +e#ruary 022&, the Inion filed a 4otion for e=ecution. 5etrola#
opposed. Dence, the present petition for certiorari 3ith application for issuance of a
Te4porary Restrainin7 "rder.
"n ) 5arch 022&, 3e issued a Te4porary Restrainin7 "rder en,oinin7 the
Secretary of !a#or fro4 enforcin7 and i4ple4entin7 the assailed Resolution and
"4ni#us Resolution dated 0) pril 0221 and 15 January 022&, respectively.
In its petition, 5etrola# assi7ns the follo3in7 errors8
A
9HE P5>&IC RESPONDEN9 HON, SECRE9ARA OF &A>OR AND
EMP&OAMEN9 COMMI99ED BRA?E A>5SE OF DISCRE9ION AND
ECCEEDED HER =5RISDIC9ION IN DEC&ARINB 9HE 9EMPORARA &AAOFF
I&&EBA& AND ORDERINB 9HE REINS9A9EMEN9 AND PAAMEN9 OF
>ACDWABES 9O 9HE AFFEC9ED EMP&OAEES,
E

9HE P5>&IC RESPONDEN9 HON, SECRE9ARA OF &A>OR AND

EMP&OAMEN9 BRA?E&A A>5SED HER DISCRE9ION IN INC&5DINB
ECEC59I?E SECRE9ARIES AS PAR9 OF 9HE >ARBAININB 5NI9 OF RAND
AND FI&E EMP&OAEES,
274
nent the first issue, 3e are as%ed to deter4ine 3hether or not pu#lic respondent
!a#or Secretary co44itted 7rave a#use of discretion and e=ceeded her ,urisdiction in
declarin7 the su#,ect layoffs instituted #y 5etrola# ille7al on 7rounds that these
unilateral actions a77ravated the conflict #et3een 5etrola# and the Inion 3ho 3ere,
then, loc%ed in a stale4ate in C. ne7otiations.
5etrola# ar7ues that the !a#or SecretaryOs order en,oinin7 the parties fro4
co44ittin7 any act that 4i7ht e=acer#ate the dispute is overly #road, s3eepin7 and
va7ue and should not #e used to curtail the e4ployerOs ri7ht to 4ana7e his #usiness
and ensure its via#ility.
Ce cannot 7ive credence to 5etrola#Os contention.
This Court reco7ni6es the e=ercise of 4ana7e4ent prero7atives and often declines
to interfere 3ith the le7iti4ate #usiness decisions of the e4ployer. Do3ever, this
privile7e is not a#solute #ut su#,ect to li4itations i4posed #y la3.
L2M
In PAL v. +LRC,
L0*M
3e issued this re4inder8
=== === ===
, , ,t%e e;ercise o$ (ana"e(ent prero"ati+es 0as ne+er considered 'oundless, 9%us,
in Cru$ %s. Medina ! 3<< SCRA F6F 238784#, it 0as %eld t%at (ana"e(ent6s
prero"ati+es (ust 'e 0it%out a'use o$ discretion,,,,
=== === ===
All this points to the conclusion that the e#ercise o" managerial prerogati%es is not
unlimited. &t is circumscribed by limitations "ound in la!, a collecti%e bargaining
agreement, or the general principles o" "air play and justice '(ni%ersity o" )to. Tomas
%. *+,C, 381 SCRA <F7 238814#, , , , !Italics ours,#
=== === ===.
The case at #ench constitutes one of the e=ceptions. The Secretary of !a#or is
e=pressly 7iven the po3er under the !a#or Code to assu4e ,urisdiction and resolve
la#or disputes involvin7 industries indispensa#le to national interest. The disputed
in,unction is su#su4ed under this special 7rant of authority. rt. 16& (7$ of the !a#or
Code specifically provides that8
=== === ===
!"# W%en, in %is opinion, t%ere e;ists a la'or dispute causin" or li/el) to cause a stri/e
or loc/out in an industr) indispensa'le to t%e national interest, t%e Secretar) o$ &a'or
and E(plo)(ent (a) assu(e *urisdiction o+er t%e dispute and decide it or certi$) t%e
sa(e to t%e Co((ission $or co(pulsor) ar'itration, Suc% assu(ption or certi$ication
s%all %a+e t%e e$$ect o$ auto(aticall) en*oinin" t%e intended or i(pendin" stri/e or
loc/out as speci$ied in t%e assu(ption or certi$ication order, I$ one %as alread) ta/en
place at t%e ti(e o$ assu(ption or certi$ication, all stri/in" or loc/ed out e(plo)ees
s%all i((ediatel) return to 0or/ and t%e e(plo)er s%all i((ediatel) resu(e
operations and read(it all 0or/ers under t%e sa(e ter(s and conditions pre+ailin"
'e$ore t%e stri/e or loc/out, 9%e Secretar) o$ &a'or and E(plo)(ent or t%e
Co((ission (a) see/ t%e assistance o$ la0 en$orce(ent a"encies to ensure
co(pliance 0it% t%is pro+ision as !ell as !ith such orders as he may issue to en"orce
the same. . . !Italics ours,#
=== === ===.
That 5etrola#Os #usiness is of national interest is not disputed. 5etrola# is one of
the leadin7 4anufacturers and suppliers of 4edical and phar4aceutical products to the
country.
5etro la#Os 4ana7e4ent prero7atives, therefore, are not #ein7 un,ustly curtailed #ut
duly #alanced 3ith and te4pered #y the li4itations set #y la3, ta%in7 into account its
special character and the particular circu4stances in the case at #ench.
s aptly declared #y pu#lic respondent Secretary of !a#or in its assailed resolution8
=== === ===.
MII is ri"%t to t%e e;tent t%at as a rule, 0e (a) not inter$ere 0it% t%e le"iti(ate
e;ercise o$ (ana"e(ent prero"ati+es suc% as la)o$$s, >ut it (a) ne+ert%eless 'e
appropriate to (ention %ere t%at one o$ t%e su'stanti+e e+ils 0%ic% Article 26 !"# o$
t%e &a'or Code see/s to cur' is t%e e;acer'ation o$ a la'or dispute to t%e $urt%er
detri(ent o$ t%e national interest, W%en a la'or dispute %as in $act occurred and a
"eneral in*unction %as 'een issued restrainin" t%e co((ission o$ disrupti+e acts,
(ana"e(ent prero"ati+es (ust al0a)s 'e e;ercised consistentl) 0it% t%e statutor)
o'*ecti+e,
2334
=== === ===.
5etrola# insists that the su#,ect layoffs did not e=acer#ate their dispute 3ith the
Inion since no unto3ard incident occurred after the layoffs 3ere i4ple4ented. There
3ere no 3or% disruptions or stoppa7es and no 4ass actions 3ere threatened or
underta%en. Instead, petitioner asserts, the affected e4ployees cal4ly accepted their
fate Pas this 3as a 4atter 3hich they had #een previously advised 3ould #e
inevita#le.Q
L01M
fter a ,udicious revie3 of the record, 3e find no co4pellin7 reason to overturn the
findin7s of the Secretary of !a#or.
Ce reaffir4 the doctrine that considerin7 their e=pertise in their respective fields,
factual findin7s of ad4inistrative a7encies supported #y su#stantial evidence are
accorded 7reat respect and #inds this Court.
L0&M
The Secretary of !a#or ruled, thus8
=== === ===.
An) act co((itted durin" t%e pendenc) o$ t%e dispute t%at tends to "i+e rise to $urt%er
contentious issues or increase t%e tensions 'et0een t%e parties s%ould 'e considered
an act6 o$ e;acer'ation, One (ust loo/ at t%e act itsel$, not on speculati+e
reactions, A (isplaced recourse is not needed to pro+e t%at a dispute %as 'een
e;acer'ated, For instance, t%e 5nion could not 'e e;pected to $ile anot%er notice o$
stri/e, For t%is 0ould depart $ro( its t%eor) o$ t%e case t%at t%e la)o$$ is su'su(ed
under t%e instant dispute, $or 0%ic% a notice o$ stri/e %ad alread) 'een $iled, On t%e
ot%er %and, to e;pect +iolent reactions, unrul) 'e%a+ior, and an) ot%er c%aotic or
drastic action $ro( t%e 5nion is to e;pect it to co((it acts disrupti+e o$ pu'lic order
or acts t%at (a) 'e ille"al, 5nder a re"i(e o$ la0s, le"al re(edies ta/e t%e place o$
+iolent ones,
23:4
=== === ===.
Protest a"ainst t%e su'*ect la)o$$s need not 'e in t%e $or( o$ +iolent action or an)
ot%er drastic (easure, In t%e instant case t%e 5nion re"istered t%eir dissent ') s0i$tl)
$ilin" a (otion $or a cease and desist order, Contrar) to petitioner6s alle"ations, t%e
5nion stron"l) conde(ned t%e la)o$$s and t%reatened (ass action i$ t%e Secretar) o$
&a'or $ails to ti(el) inter+eneG
=== === ===.
, 9%is unilateral action o$ (ana"e(ent is a 'latant +iolation o$ t%e in*unction o$ t%is
O$$ice a"ainst co((ittin" acts 0%ic% 0ould e;acer'ate t%e dispute, 5nless suc% act
is en*oined t%e 5nion 0ill 'e co(pelled to resort to its le"al ri"%t to (ass actions and
concerted acti+ities to protest and stop t%e said (ana"e(ent action, 9%is (ass la)o$$
is clearl) one 0%ic% 0ould result in a +er) serious la'or dispute unless t%is O$$ice
s0i$tl) inter+enes,
23F4
=== === ===.
5etrola# and the Inion 3ere still in the process of resolvin7 their C. deadloc%
3hen petitioner i4ple4ented the su#,ect layoffs. s a result, 4otions and oppositions
3ere filed divertin7 the partiesO attention, delayin7 resolution of the #ar7ainin7 deadloc%
and postponin7 the si7nin7 of their ne3 C., there#y a77ravatin7 the 3hole conflict.
Ce, li%e3ise, find untena#le 5etrola#Os contention that the layoff of the 2) ran%(and(
file e4ployees 3as te4porary, despite the recall of so4e of the laid off 3or%ers.
If 5etrola# intended the layoff of the 2) 3or%ers to #e te4porary, it should have
plainly stated so in the notices it sent to the affected e4ployees and the -epart4ent of
!a#or and E4ploy4ent. Consider the tenor of the pertinent portions of the layoff notice
to the affected e4ployees8
=== === ===.
Da%il sa ("a 'a"a) na ito, napilitan an" atin" /u(pan)a na (a"sa"a0a n" Hla)-o$$I
n" ("a e(ple)ado sa Ran/ J File da%il na'a0asan an" tra'a%o at pu0esto para sa
/anila, Marami sa atin ang kasama sa -lay-o"". da%il !ala nang trabaho para sa
kanila. Ma%irap tan""apin an" ("a 'a"a) na ito su'alit /ailan"an natin" "a0in da%il
%indi /a)a n" /u(pan)a an" (a"'a)ad n" su0eldo /un" an" e(ple)ado a) 0alan"
tra'a%o, Dun" ta)o a) patulo) na (a"'a'a)ad n" su0eldo, (as %i%ina an" atin"
/u(pan)a at (as (ara(i an" (Kaarin" (aape/tu%an,
Sa pa"papatupad n" Hla)-o$$I susundin natin an" &AS9 IN-FIRS9 O59 polic), An"
("a e(ple)adon" (a) pina/a(ai/lin" ser'is)o sa /u(pan)a an" unan"
(aaape/tu%an, Ito a) 'ata) na rin sa na/asaad sa atin" C>A na an" ("a %ulin"
pu(aso/ sa /u(pan)a an" unan" (asasa(a sa Hla)-o$$I /apa" na"/aroon n"
"aniton" ("a /ala"a)an,
An" ("a e(ple)ado na /asa(a sa Hla)-o$$I a) na/alista sa sulat na ito, An" u(pisa
n" la)-o$$ a) sa &unes, Enero 2<, Hindi na (una sila papaso/ sa /u(pan)a,
Ma/u/u%a nila an" su0eldo nila sa Enero 1, 3882,
/indi po natin matitiyak kung gaano katagal ang -lay-o"". ngunit ang aming tingin
ay matatagalan bago magkaroon ng dagdag na trabaho. Dahil dito, sinimulan na
namin ang isang -,edundancy 0rogram. sa mga super%isors. *aba!asan ang mga
pu!esto para sa kanila, kaya sila ay ma!a!alan ng trabaho at bibigyan na ng
redundancy pay.
2364
!Italics ours,#
=== === ===.
Ce a7ree 3ith the rulin7 of the Secretary of !a#or, thus8
=== === ===.
, , ,MII insists t%at t%e la)o$$ in .uestion is te(porar) not per(anent, It t%en
cites &nternational /ard!are, &nc. %s. *+,C, 3<6 SCRA 2F6, in 0%ic% t%e Supre(e
Court %eld t%at t%e 1-da) notice re.uired under Article 27 o$ t%e &a'or Code need
not 'e co(plied 0it% i$ t%e e(plo)er %as no intention to per(anentl) se+ere !sic# t%e
e(plo)(ent relations%ip,
We are not con+inced ') t%is ar"u(ent, &nternational /ard!are in+ol+es a case
0%ere t%ere %ad 'een a reduction o$ 0or/load, Precisel) to a+oid la)in" o$$ t%e
e(plo)ees, t%e e(plo)er t%erein opted to "i+e t%e( 0or/ on a rotatin" 'asis, 9%ou"%
on a li(ited scale, 0or/ 0as a+aila'le, 9%is 0as t%e Supre(e Court6s 'asis $or
%oldin" t%at t%ere 0as no intention to per(anentl) se+ere !sic# t%e e(plo)(ent
relations%ip,
Here, t%ere is no circu(stance at all $ro( 0%ic% 0e can in$er an intention $ro( MII
not to se+er t%e e(plo)(ent relations%ip per(anentl), I$ t%ere 0as suc% an intention,
MII could %a+e (ade it +er) clear in t%e notices o$ la)o$$, >ut as it 0ere, t%e notices
are couc%ed in a lan"ua"e so uncertain t%at t%e onl) conclusion possi'le is t%e
per(anent ter(ination, not t%e continuation, o$ t%e e(plo)(ent relations%ip,
MII also see/s to e;cuse itsel$ $ro( co(pliance 0it% t%e 1-da) notice 0it% a
tautolo"), W%ile insistin" t%at t%ere is reall) no 'est ti(e to announce a 'ad ne0s,
!sic# it also clai(s t%at it 'ro/e t%e 'ad ne0s onl) on 2< =anuar) 3882 'ecause %ad it
co(plied 0it% t%e 1-da) notice, it could %a+e 'ro/en t%e 'ad ne0s on 12 =anuar)
3882, t%e $irst 0or/in" da) o$ t%e )ear, I$ t%ere is reall) no 'est ti(e to announce a
'ad ne0s !sic#, it 0ouldn6t %a+e (attered i$ t%e sa(e 0as announced at t%e $irst
0or/in" da) o$ t%e )ear, 9%at 0a), MII could %a+e at least co(plied 0it% t%e
re.uire(ent o$ t%e la0,
23<4
The second issue raised #y petitioner 4erits our consideration.
In the assailed "4ni#us Resolution, !a#or Secretary Confesor clarified the C.
provisions on closed(shop and the scope of the #ar7ainin7 unit in this 3ise8
=== === ===.
ppropriateness of the #ar7ainin7 unit.
=== === ===.
E2clusions. In our 0) pril 0221 resolution, 3e ruled on the issue of e=clusion as
follo3s8
9%ese aside, 0e reconsider our denial o$ t%e (odi$ications 0%ic% t%e 5nion proposes
to introduce on t%e close s%op pro+ision, W%ile 0e note t%at t%e pro+ision as
presentl) 0orded %as ser+ed6 t%e relations%ip o$ t%e parties 0ell under pre+ious
C>A6s, t%e shi"t in constitutional policy to!ard e#panding the right o" all !orkers to
sel"-organi$ation should no! be "ormally recogni$ed by the parties, subject to the
"ollo!ing e#clusions only1
3, Mana"erial e(plo)ees@ and
2, 9%e e;ecuti+e secretaries o$ t%e President, E;ecuti+e ?ice-President, ?ice-
President, ?ice President $or Sales, Personnel Mana"er, and Director $or Corporate
Plannin" 0%o (a) %a+e access to +ital la'or relations in$or(ation or 0%o (a)
ot%er0ise act in a con$idential capacit) to persons 0%o deter(ine or $or(ulate
(ana"e(ent policies,
9%e pro+isions o$ Article I !'# and Attac%(ent I o$ t%e 3877-3881 C>A s%all t%us 'e
(odi$ied consistentl) 0it% t%e $ore"oin",
rticle I (#$ of the 02''(022* C. provides8
'#Close S%op, - All Luali$ied E(plo)ees (ust *oin t%e Association i((ediatel) upon
re"ulariMation as a condition $or continued e(plo)(ent, 9%is pro+ision s%all not
appl) toG !i# (ana"erial e(plo)ees 0%o are e;cluded $ro( t%e scope o$ t%e 'ar"ainin"
unit@ !ii# t%e auditors and e;ecuti+e secretaries o$ senior e;ecuti+e o$$icers, suc% as,
t%e President, E;ecuti+e ?ice-President, ?ice-President $or Finance, Head o$ &e"al,
?ice-President $or Sales, 0%o are e#cluded "rom membership in the Association2 and
!iii# t%ose e(plo)ees 0%o are re$erred to in Attac%(ent I %ereo$, su'*ect, %o0e+er, to
t%e application o$ t%e pro+ision o$ Article II, par, !'# %ereo$, Conse.uentl), t%e a'o+e-
speci$ied e(plo)ees are not re.uired to *oin t%e Association as a condition $or t%eir
continued e(plo)(ent,
"n the other hand, ttach4ent I provides8
E=clusion fro4 the Scope of the Close Shop Provision
The follo3in7 positions in the .ar7ainin7 Init are not covered #y the Close Shop
provision of the C. (rticle I, par. #$8
3, E;ecuti+e Secretaries o$ ?ice-Presidents, or e.ui+alent positions,
2, E;ecuti+e Secretar) o$ t%e Personnel Mana"er, or e.ui+alent positions,
, E;ecuti+e Secretar) o$ t%e Director $or Corporate Plannin", or e.ui+alent positions,
:, So(e personnel in t%e Personnel Depart(ent, EDP Sta$$ at Head O$$ice, Pa)roll
Sta$$ at Head O$$ice, Accountin" Depart(ent at Head O$$ice, and >ud"et Sta$$, 0%o
'ecause o$ t%e nature o$ t%eir duties and responsi'ilities need not *oin t%e Association
as a condition $or t%eir e(plo)(ent,
F, Ne0l)-%ired secretaries o$ >ranc% Mana"ers and Re"ional Mana"ers,
.oth 5-- and 5II read the e=clusion of 4ana7erial e4ployees and e=ecutive
secretaries in our 0) pril 0221 resolution as e=clusion fro4 the #ar7ainin7 unit. They
point out that 4ana7erial e4ployees are lu4ped under one classification 3ith e=ecutive
secretaries, so that since the for4er are e=cluded fro4 the #ar7ainin7 unit, so 4ust the
latter #e li%e3ise e=cluded.
This readin7 is o#viously contrary to the intent of our 0) pril 0221 resolution. .y
reco7ni6in7 the e=panded scope of the ri7ht to self(or7ani6ation, our intent 3as to
deli4it the types of e4ployees e=cluded fro4 the close shop provision, not fro4 the
#ar7ainin7 unit, to e=ecutive secretaries only. "ther3ise, the conversion of the
e=clusionary provision to one that refers to the #ar7ainin7 unit fro4 one that 4erely
refers to the close shop provision 3ould effectively curtail all the or7ani6ational ri7hts of
e=ecutive secretaries.
The e=clusion of 4ana7erial e4ployees, in accordance 3ith la3, 4ust therefore still
carry the @ualifyin7 phrase Pfro4 the #ar7ainin7 unitQ in rticle I (#$(i$ of the 02''(022*
C.. In the sa4e 4anner, the e=clusion of e=ecutive secretaries should #e read
to7ether 3ith the @ualifyin7 phrase Pare e=cluded fro4 4e4#ership in the ssociationQ
of the sa4e rticle and 3ith the headin7 of ttach4ent I. The latter refers to
PE=clusions fro4 Scope of Close Shop ProvisionQ and provides that PLtMhe follo3in7
positions in .ar7ainin7 Init are not covered #y the close shop provision of the C..Q
The issue of e=clusion has different di4ension in the case of 5II. In an earlier
4otion for clarification, 5II points out that it has done a3ay 3ith the positions of
E=ecutive Gice(President, Gice(President for Sales, and -irector for Corporate
Plannin7. Thus, the fore7oin7 7roup of e=clusions is no lon7er appropriate in its present
or7ani6ational structure. /evertheless, there re4ain 5II officer positions for 3hich there
4ay #e e=ecutive secretaries. These include the 9eneral 5ana7er and 4e4#ers of the
5ana7e4ent Co44ittee, specifically i$ the Nuality ssurance 5ana7er; ii$ the Product
-evelop4ent 5ana7er; iii$ the +inance -irector; iv$ the 5ana7e4ent Syste4 5ana7er;O
v$ the Du4an Resources 5ana7er; vi$ the 5ar%etin7 -irector; vii$ the En7ineerin7
5ana7er; viii$ the 5aterials 5ana7er; and i=$ the Production 5ana7er.
=== === ===
The #asis for the @uestioned e=clusions, it should #e noted, is no other than the
previous C. #et3een 5II and the Inion. If 5II had under7one an or7ani6ational
restructurin7 since then, this is a fact to 3hich 3e have never #een 4ade privy. In any
event, had this #een other3ise the result 3ould have #een the sa4e. To repeat, 3e
li4ited the e=clusions to reco7ni6e the e=panded scope of the ri7ht to self(or7ani6ation
as e4#odied in the Constitution.
L0'M
5etrola#, ho3ever, 4aintains that e=ecutive secretaries of the 9eneral 5ana7er
and the e=ecutive secretaries of the Nuality ssurance 5ana7er, Product -evelop4ent
5ana7er, +inance -irector, 5ana7e4ent Syste4 5ana7er, Du4an Resources
5ana7er, 5ar%etin7 -irector, En7ineerin7 5ana7er, 5aterials 5ana7er and Production
5ana7er, 3ho are all 4e4#ers of the co4panyOs 5ana7e4ent Co44ittee should not
only #e e=e4pted fro4 the closed(shop provision #ut should #e e=cluded fro4
4e4#ership in the #ar7ainin7 unit of the ran% and file e4ployees as 3ell on 7rounds
that their e=ecutive secretaries are confidential e4ployees, havin7 access to Pvital la#or
infor4ation.Q
L02M
Ce concur 3ith 5etrola#.
lthou7h rticle 1)5 of the !a#or Code
L1*M
li4its the ineli7i#ility to ,oin, for4 and assist
any la#or or7ani6ation to 4ana7erial e4ployees, ,urisprudence has e=tended this
prohi#ition to confidential e4ployees or those 3ho #y reason of their positions or nature
of 3or% are re@uired to assist or act in a fiduciary 4anner to 4ana7erial e4ployees and
hence, are li%e3ise privy to sensitive and hi7hly confidential records.
The rationale #ehind the e=clusion of confidential e4ployees fro4 the #ar7ainin7
unit of the ran% and file e4ployees and their dis@ualification to ,oin any la#or
or7ani6ation 3as succinctly discussed in P(ilips In)ustrial %evelopment v. +LRCC
L10M
=== === ===.
On t%e (ain issue raised 'e$ore 5s, it is .uite o'+ious t%at respondent N&RC
co((itted "ra+e a'use o$ discretion in re+ersin" t%e decision o$ t%e E;ecuti+e &a'or
Ar'iter and in decreein" t%at PIDI6s HSer+ice En"ineers, Sales Force, di+ision
secretaries, all Sta$$ o$ Beneral Mana"e(ent, Personnel and Industrial Relations
Depart(ent, Secretaries o$ Audit, EDP and Financial S)ste(s are included 0it%in t%e
ran/ and $ile 'ar"ainin" unit,I
In t%e $irst place, all t%ese e(plo)ees, 0it% t%e e;ception o$ t%e ser+ice en"ineers and
t%e sales $orce personnel, are con$idential e(plo)ees, 9%eir classi$ication as suc% is
not seriousl) disputed ') PEO-FFW@ t%e $i+e !F# pre+ious C>As 'et0een PIDI and
PEO-FFW e;plicitl) considered t%e( as con$idential e(plo)ees, >) t%e +er) nature
o$ t%eir $unctions, t%e) assist and act in a con$idential capacit) to, or %a+e access to
con$idential (atters o$, persons 0%o e;ercise (ana"erial $unctions in t%e $ield o$
la'or relations, As suc%, t%e rationale 'e%ind t%e ineli"i'ilit) o$ (ana"erial
e(plo)ees to $or(, assist or *oin a la'or union e.uall) applies to t%e(,
In Bulletin Publis(ing Co., Inc. vs. Hon. Augusto .anc(e,, this Court ela#orated on
this rationale, thus8
; ; ; 9%e rationale $or t%is in%i'ition %as 'een stated to 'e, 'ecause i$ t%ese
(ana"erial e(plo)ees 0ould 'elon" to or 'e a$$iliated 0it% a 5nion, t%e latter (i"%t
not 'e assured o$ t%eir lo)alt) to t%e 5nion in +ie0 o$ e+ident con$lict o$
interests, 9%e 5nion can also 'eco(e co(pan)-do(inated 0it% t%e presence o$
(ana"erial e(plo)ees in 5nion (e('ers%ip,I
In 9olden +ar4s, Inc. vs. +errer(Calle,a, this Court e=plicitly 4ade this rationale
applica#le to confidential e4ployees8
9%is rationale %olds true also $or con$idential e(plo)ees suc% as accountin"
personnel, radio and tele"rap% operators, 0%o %a+in" access to con$idential
in$or(ation, (a) 'eco(e t%e source o$ undue ad+anta"e, Said e(plo)ee!s# (a) act
as a sp) or spies o$ eit%er part) to a collecti+e 'ar"ainin" a"ree(ent, 9%is is speciall)
true in t%e present case 0%ere t%e petitionin" 5nion is alread) t%e 'ar"ainin" a"ent o$
t%e ran/-and-$ile e(plo)ees in t%e esta'lis%(ent, 9o allo0 t%e con$idential
e(plo)ees to *oin t%e e;istin" 5nion o$ t%e ran/-and-$ile 0ould 'e in +iolation o$ t%e
ter(s o$ t%e Collecti+e >ar"ainin" A"ree(ent 0%erein t%is /ind o$ e(plo)ees ') t%e
nature o$ t%eir $unctionsNpositions are e;pressl) e;cluded,I
=== === ===.
Si4ilarly, in /ational ssociation of Trade Inion ( Republic Planters Ban$
.upervisors C(apter v. "orres
L11M
3e declared8
=== === ===.
, , , As re"ards t%e ot%er clai( o$ respondent >an/ t%at >ranc% Mana"ersNOICs,
Cas%iers and Controllers are con$idential e(plo)ees, %a+in" control, custod) andN or
access to con$idential (atters, e,",, t%e 'ranc%6s cas% position, state(ents o$ $inancial
condition, +ault co('ination, cas% codes $or tele"rap%ic trans$ers, de(and dra$ts and
ot%er ne"otia'le instru(ents, pursuant to Sec, 3366,: o$ t%e Central >an/ Manual
re"ardin" *oint custod), t%is clai( is not e+en disputed ') petitioner, A con$idential
e(plo)ee is one entrusted 0it% con$idence on delicate (atters, or 0it% t%e custod),
%andlin", or care and protection o$ t%e e(plo)er6s propert), W%ile Art, 2:F o$ t%e
&a'or Code sin"les out (ana"erial e(plo)ees as ineli"i'le to *oin, assist or $or( an)
la'or or"aniMation, under t%e doctrine o$ necessar), i(plication, con$idential
e(plo)ees are si(ilarl) dis.uali$ied, , , ,
=== === ===.
, , ,!I#n t%e collecti+e 'ar"ainin" process, (ana"erial e(plo)ees are supposed to 'e on
t%e side o$ t%e e(plo)er, to act as its representati+es, and to see to it t%at its interest
are 0ell protected, 9%e e(plo)er is not assured o$ suc% protection i$ t%ese e(plo)ees
t%e(sel+es are union (e('ers, Collecti+e 'ar"ainin" in suc% a situation can 'eco(e
one-sided, It is t%e sa(e reason t%at i(pelled t%is Court to consider t%e position o$
con$idential e(plo)ees as included in t%e dis.uali$ication $ound in Art, 2:F as i$ t%e
dis.uali$ication o$ con$idential e(plo)ees 0ere 0ritten in t%e pro+ision, I$
con$idential e(plo)ees could unioniMe in order to 'ar"ain $or ad+anta"es $or
t%e(sel+es, t%en t%e) could 'e "o+erned ') t%eir o0n (oti+es rat%er t%an t%e interest
o$ t%e e(plo)ers, Moreo+er, unioniMation o$ con$idential e(plo)ees $or t%e purpose
o$ collecti+e 'ar"ainin" 0ould (ean t%e e;tension o$ t%e la0 to persons or indi+iduals
0%o are supposed to act Hin t%e interest o$ t%e e(plo)ers, It is not $ar$etc%ed t%at in
t%e course o$ collecti+e 'ar"ainin", t%e) (i"%t *eopardiMe t%at interest 0%ic% t%e) are
dut)-'ound to protect, , , ,
=== === ===.
nd in the latest case of Pier ' rrastre R Stevedorin7 Services, Inc. vs. Roldan(
Confesor,
L1&M
3e ruled that8
=== === ===.
5pon t%e ot%er %and, le"al secretaries are neit%er (ana"ers nor super+isors, 9%eir
0or/ is 'asicall) routinar) and clerical, Ho0e+er, t%e) s%ould 'e di$$erentiated $ro(
ran/-and-$ile e(plo)ees 'ecause t%e) are tas/ed 0it%, a(on" ot%ers, t%e t)pin" o$
le"al docu(ents, (e(oranda and correspondence, t%e /eepin" o$ records and $iles,
t%e "i+in" o$ and recei+in" notices, and suc% ot%er duties as re.uired ') t%e le"al
personnel o$ t%e corporation, &e"al secretaries t%ere$ore $all under t%e cate"or) o$
con$idential e(plo)ees, , , ,
=== === ===.
We t%us %old t%at pu'lic respondent acted 0it% "ra+e a'use o$ discretion in not
e;cludin" t%e $our $ore(en and le"al secretar) $ro( t%e 'ar"ainin" unit co(posed o$
ran/-and-$ile e(plo)ees,
=== === ===.
In t%e case at 'enc%, t%e 5nion does not disa"ree 0it% petitioner t%at t%e e;ecuti+e
secretaries are con$idential e(plo)ees, It %o0e+er, (a/es t%e $ollo0in" contentionsG
=== === ===.
9%ere 0ould 'e no dan"er o$ co(pan) do(ination o$ t%e 5nion since t%e con$idential
e(plo)ees 0ould not 'e (e('ers o$ and 0ould not participate in t%e decision (a/in"
processes o$ t%e 5nion,
Neit%er 0ould t%ere 'e a dan"er o$ espiona"e since t%e con$idential e(plo)ees 0ould
not %a+e an) con$lict o$ interest, not 'ein" (e('ers o$ t%e 5nion, In an) case, t%ere
is al0a)s t%e dan"er t%at an) e(plo)ee 0ould lea/ (ana"e(ent secrets to t%e 5nion
out o$ s)(pat%) $or %is $ello0 ran/ and $iler e+en i$ %e 0ere not a (e('er o$ t%e
union nor t%e 'ar"ainin" unit,
Con$idential e(plo)ees are ran/ and $ile e(plo)ees and t%e), li/e all t%e ot%er ran/
and $ile e(plo)ees, s%ould 'e "ranted t%e 'ene$its o$ t%e Collecti+e >ar"ainin"
A"ree(ent, 9%ere is no +alid 'asis $or discri(inatin" a"ainst t%e(, 9%e (andate o$
t%e Constitution and t%e &a'or Code, pri(aril) o$ protection to &a'or, co(pels suc%
conclusion,
22:4
=== === ===.
The InionOs assurances fail to convince. The dan7ers sou7ht to #e prevented,
particularly the threat of conflict of interest and espiona7e, are not eli4inated #y non(
4e4#ership of 5etrola#Os e=ecutive secretaries or confidential e4ployees in the
Inion. +or4in7 part of the #ar7ainin7 unit, the e=ecutive secretaries stand to #enefit
fro4 any a7ree4ent e=ecuted #et3een the Inion and 5etrola#. Such a scenario, thus,
7ives rise to a potential conflict #et3een personal interests and their duty as confidential
e4ployees to act for and in #ehalf of 5etrola#. They do not have to #e union 4e4#ers
to affect or influence either side.
+inally, confidential e4ployees cannot #e classified as ran% and file. s previously
discussed, the nature of e4ploy4ent of confidential e4ployees is @uite distinct fro4 the
ran% and file, thus, 3arrantin7 a separate cate7ory. E=cludin7 confidential e4ployees
fro4 the ran% and file #ar7ainin7 unit, therefore, is not tanta4ount to discri4ination.
1;EREFORE, pre4ises considered, the petition is partially 9R/TE-. The
resolutions of pu#lic respondent Secretary of !a#or dated 0) pril 0221 and 15 January
022& are here#y 5"-I+IE- to the e=tent that e=ecutive secretaries of petitioner
5etrola#Os 9eneral 5ana7er and the e=ecutive secretaries of the 4e4#ers of its
5ana7e4ent Co44ittee are e=cluded fro4 the #ar7ainin7 unit of petitionerOs ran% and
file e4ployees.
SO OR!ERE!.
#ase "o 6
SEC"/- -IGISI"/
BG.R. No. 115399. A7?7&, 1(, 1997C
SAN MIG3EL CORPORATION S3PERVISORS AN! EEEMPT 3NION
AN! ERNESTO L. PONCE, P/'&6#'",,petitioners,
vs. ;ONARALE IENVENI!O E. LAG3ESMA IN ;IS CAPACITY
AS 3N!ERSECRETARY OF LAOR AN! EMPLOYMENT,
;ONORALE !ANILO L. REYNANTE IN ;IS CAPACITY AS ME!%
ARITER AN! SAN MIG3EL CORPORATION, respondents.
! E C I S I O N
ROMERO, J.F
This is a Petition for Certiorari 3ith Prayer for the Issuance of Preli4inary
In,unction see%in7 to reverse and set aside the "rder of pu#lic respondent,
Indersecretary of the -epart4ent of !a#or and E4ploy4ent, .ienvenido E.
!a7ues4a, dated 5arch 00, 022&, in Case /o. "S 5 (1(A*(20
L0M
entitled PIn
Re8 Petition for Certification Election 4on7 the Supervisory and E=e4pt
E4ployees of the San 5i7uel Corporation 5a7nolia Poultry Plants of
Ca#uyao, San +ernando and "tis, San 5i7uel Corporation Supervisors and
E=e4pt Inion, Petitioner.Q The "rder e=cluded the e4ployees under
supervisory levels & and ) and the so(called e=e4pt e4ployees fro4 the
proposed #ar7ainin7 unit and ruled out their participation in the certification
election.
The antecedent facts are undisputed8
"n "cto#er 5, 022*, petitioner union filed #efore the -epart4ent of !a#or
and E4ploy4ent (-"!E$ a Petition for -istrict Certification or Certification
Election a4on7 the supervisors and e=e4pt e4ployees of the S5C 5a7nolia
Poultry Products Plants of Ca#uyao, San +ernando and "tis.
"n -ece4#er 02, 022*, 5ed(r#iter -anilo !. Reynante issued an "rder
orderin7 the conduct of certification a4on7 the supervisors and e=e4pt
e4ployees of the S5C 5a7nolia Poultry Products Plants of Ca#uyao, San
+ernando and "tis as one #ar7ainin7 unit.
"n January 0', 0220, respondent San 5i7uel Corporation filed a /otice of
ppeal 3ith 5e4orandu4 on ppeal, pointin7 out, a4on7 others, the 5ed(
r#iterOs error in 7roupin7 to7ether all three (&$ separate plants, "tis, Ca#uyao
and San +ernando, into one #ar7ainin7 unit, and in includin7 supervisory
levels & and a#ove 3hose positions are confidential in nature.
"n July 1&, 0220, the pu#lic respondent, Indersecretary !a7ues4a,
7ranted respondent co4panyOs ppeal and ordered the re4and of the case to
the 5ed(r#iter of ori7in for deter4ination of the true classification of each of
the e4ployees sou7ht to #e included in the appropriate #ar7ainin7 unit.
Ipon petitioner(unionOs 4otion dated u7ust A, 0220, Indersecretary
!a7ues4a 7ranted the reconsideration prayed for on Septe4#er &, 0220 and
directed the conduct of separate certification elections a4on7 the supervisors
ran%ed as supervisory levels 0 to ) (S0 to S)$ and the e=e4pt e4ployees in
each of the three plants at Ca#uyao, San +ernando and "tis.
"n Septe4#er 10, 0220, respondent co4pany, San 5i7uel Corporation
filed a 5otion for Reconsideration 3ith 5otion to suspend proceedin7s.
"n 5arch 00, 022&, an "rder 3as issued #y the pu#lic respondent
7rantin7 the 5otion, citin7 the doctrine enunciated in Philips Industrial
-evelop4ent, Inc. v. /!RC
L1M
case. Said "rder reads in part8
H; ; ; Con$idential e(plo)ees, li/e (ana"erial e(plo)ees, are not allo0ed to $or(,
*oin or assist a la'or union $or purposes o$ collecti+e 'ar"ainin",
In t%is case, S and S: and t%e so-called e;e(pt e(plo)ees are ad(ittedl)
con$idential e(plo)ees and t%ere$ore, t%e) are not allo0ed to $or(, *oin or assist a
la'or union $or purposes o$ collecti+e 'ar"ainin" $ollo0in" t%e a'o+e court6s
rulin", Conse.uentl), t%e) are not allo0ed to participate in t%e certi$ication election,
WHEREFORE, t%e (otion is %ere') "ranted and t%e Decision o$ t%is O$$ice dated 1
Septe('er 3883 is %ere') (odi$ied to t%e e;tent t%at e(plo)ees under super+isor)
le+els and : !S and S:# and t%e so-called e;e(pt e(plo)ees are not allo0ed to *oin
t%e proposed 'ar"ainin" unit and are t%ere$ore e;cluded $ro( t%ose 0%o could
participate in t%e certi$ication election,I
24
Hence t%is petition,
+or resolution in this case are the follo3in7 issues8
0. Chether Supervisory e4ployees & and ) and the e=e4pt e4ployees of the
co4pany are considered confidential e4ployees, hence ineli7i#le fro4 ,oinin7 a
union.
1. If they are not confidential e4ployees, do the e4ployees of the three plants
constitute an appropriate sin7le #ar7ainin7 unit.
"n the first issue, this Court rules that said e4ployees do not fall 3ithin
the ter4 Pconfidential e4ployeesQ 3ho 4ay #e prohi#ited fro4 ,oinin7 a union.
There is no @uestion that the said e4ployees, supervisors and the e=e4pt
e4ployees, are not vested 3ith the po3ers and prero7atives to lay do3n and
e=ecute 4ana7e4ent policies and>or to hire, transfer, suspend, layoff, recall,
dischar7e or dis4iss e4ployees. They are, therefore, not @ualified to #e
classified as 4ana7erial e4ployees 3ho, under rticle 1)5
L)M
of the !a#or
Code, are not eli7i#le to ,oin, assist or for4 any la#or or7ani6ation. In the very
sa4e provision, they are not allo3ed 4e4#ership in a la#or or7ani6ation of
the ran%(and(file e4ployees but 4ay ,oin, assist or for4 separate la#or
or7ani6ations of their o3n. The only @uestion that need #e addressed is
3hether these e4ployees are properly classified as confidential e4ployees or
not.
Confidential e4ployees are those 3ho (0$ assist or act in a confidential
capacity, (1$ to persons 3ho for4ulate, deter4ine, and effectuate
4ana7e4ent policies in the field of la#or relations.
L5M
The t3o criteria are
cu4ulative, and #oth 4ust #e 4et if an e4ployee is to #e considered a
confidential e4ployee S that is, the confidential relationship 4ust e=ist
#et3een the e4ployees and his supervisor, and the supervisor 4ust handle
the prescri#ed responsi#ilities relatin7 to la#or relations.
L6M
The e=clusion fro4 #ar7ainin7 units of e4ployees 3ho, in the nor4al
course of their duties, #eco4e a3are of 4ana7e4ent policies relatin7 to la#or
relations is a principal o#,ective sou7ht to #e acco4plished #y the
Pconfidential e4ployee rule.Q "(e broa) rationale be(in) t(is rule is t(at
emplo!ees s(oul) not be place) in a position involving a potential conlict o
interests.
LAM
P5ana7e4ent should not #e re@uired to handle la#or relations
4atters throu7h e4ployees 3ho are represented #y the union 3ith the
co4pany is re@uired to deal and 3ho in the nor4al perfor4ance of their duties
4ay o#tain advance infor4ation of the co4panyOs position 3ith re7ard to
contract ne7otiations, the disposition of 7rievances, or other la#or relations
4atters.Q
L'M
There have #een a4ple precedents in this re7ard, thus in .ulletin
Pu#lishin7 Co4pany v. Don. u7usto Sanche6,
L2M
the Court held that Pif these
4ana7erial e4ployees 3ould #elon7 to or #e affiliated 3ith a Inion, the latter
4i7ht not #e assured of their loyalty to the Inion in vie3 of evident conflict of
interest. The Inion can also #eco4e co4pany(do4inated 3ith the presence
of 4ana7erial e4ployees in Inion 4e4#ership.Q The sa4e rationale 3as
applied to confidential e4ployees in P9olden +ar4s, Inc. v. +errer(
Calle,aQ
L0*M
and in the 4ore recent case of PPhilips Industrial -evelop4ent,
Inc. v. /!RCQ
L00M
3hich held that confidential e4ployees, #y the very nature of
their functions, assist and act in a confidential capacity to, or have access to
confidential 4atters of, persons 3ho e=ercise 4ana7erial functions in the field
of la#or relations. Therefore, the rationale #ehind the ineli7i#ility of 4ana7erial
e4ployees to for4, assist or ,oin a la#or union 3as held e@ually applica#le to
the4.
L01M
n i4portant ele4ent of the Pconfidential e4ployee ruleQ is the e4ployeeOs
need to use la#or relations infor4ation. Thus, in deter4inin7 the
confidentiality of certain e4ployees, a %ey @uestions fre@uently considered is
the e4ployeesO necessary access to confidential la#or relations infor4ation.
L0&M
It is the contention of respondent corporation that Supervisory e4ployees
& and ) and the e=e4pt e4ployees co4e 3ithin the 4eanin7 of the ter4
Pconfidential e4ployeesQ pri4arily #ecause they ans3ered in the affir4ative
3hen as%ed P-o you handle confidential data or docu4entsJQ in the Position
Nuestionnaires su#4itted #y the Inion.
L0)M
In the sa4e @uestionnaire, ho3ever,
it 3as also stated that the confidential infor4ation handled #y @uestioned
e4ployees relate to product for4ulation, product standards and product
specification 3hich #y no 4eans relate to Pla#or relations.Q
L05M
9rantin7 arguen)o that an e4ployee has access to confidential la#or
relations infor4ation #ut such is 4erely incidental to his duties and %no3led7e
thereof is not necessary in the perfor4ance of such duties, said access does
not render the e4ployee a confidential e4ployee.
L06M
PIf access to confidential
la#or relations infor4ation is to #e a factor in the deter4ination of an
e4ployeeOs confidential status, such infor4ation 4ust relate to the e4ployerOs
la#or relations policies. Thus, an e4ployee of a la#or union, or of a
4ana7e4ent association, 4ust have access to confidential la#or infor4ation
3ith respect to his e4ployer, the union, or the association, to #e re7arded a
confidential e4ployee, and %no3led7e of la#or relations infor4ation pertainin7
to the co4panies 3ith 3hich the union deals, or 3hich the association
represents, 3ill not clause an e4ployee to #e e=cluded fro4 the #ar7ainin7
unit representin7 e4ployees of the union or association.Q
L0AM
Pccess to
infor4ation 3hich is re7arded #y the e4ployer to #e confidential fro4 the
#usiness standpoint, such as financial infor4ation
L0'M
or technical trade secrets,
3ill not render an e4ployee a confidential e4ployee.Q
L02M
Derein listed are the functions of supervisors & and hi7her8
0. To underta%e decisions to discontinue>te4porarily stop shift operations 3hen
situations re@uire.
1. To effectively oversee the @uality control function at the processin7 lines in the
stora7e of chic%en and other products.
&. To ad4inister efficient syste4 of evaluation of products in the outlets.
). To #e directly responsi#le for the recall, holdin7 and re,ection of direct
4anufacturin7 4aterials.
5. To reco44end and initiate actions in the 4aintenance of sanitation and hy7iene
throu7hout the plant.
L1*M
It is evident that 3hatever confidential data the @uestioned e4ployees 4ay
handle 3ill have to relate to their functions. +ro4 the fore7oin7 functions, it
can #e 7leaned that the confidential infor4ation said e4ployees have access
to concern the e4ployerOs internal #usiness operations. s held
in Cestin7house Electric Corporation v . /ational !a#or Relations .oard,
L10M
Pan
e4ployee 4ay not #e e=cluded fro4 appropriate #ar7ainin7 unit 4erely
#ecause he has access to confidential infor4ation concernin7 e4ployerOs
internal #usiness operations and 3hich is not related to the field of la#or
relations.Q
It 4ust #e #orne in 4ind that Section & of rticle FIII of the 02'A
Constitution 4andates the State to 7uarantee to PallQ 3or%ers the ri7ht to self(
or7ani6ation. Dence, confidential e4ployees 3ho 4ay #e e=cluded fro4
#ar7ainin7 unit 4ust #e strictly defined so as not to needlessly deprive 4any
e4ployees of their ri7ht #ar7ain collectively throu7h representatives of their
choosin7.
L11M
In the case at #ar, supervisors & and a#ove 4ay not #e considered
confidential e4ployees 4erely #ecause they handle Pconfidential dataQ as
such 4ust first #e strictly classified as pertainin7 to la#or relations for the4 to
fall under said restrictions. The infor4ation they handle are properly
classifia#le as technical and internal #usiness operations data 3hich, to our
4ind, has no relevance to ne7otiations and settle4ent of 7rievances 3herein
the interests of a union and the 4ana7e4ent are invaria#ly adversarial. Since
the e4ployees are not classifia#le under the confidential type, this Court rules
that they 4ay appropriately for4 a #ar7ainin7 unit for purposes of collective
#ar7ainin7. +urther4ore, even assu4in7 that they are confidential
e4ployees, ,urisprudence has esta#lished that there is no le7al prohi#ition
a7ainst confidential e4ployees 3ho are not perfor4in7 4ana7erial functions
to for4 and ,oin a union.
L1&M
In this connection, the issue of 3hether the e4ployees of San 5i7uel
Corporation 5a7nolia Poultry Products Plants of Ca#uyao, San +ernando,
and "tis constitute a sin7le #ar7ainin7 unit needs to #e threshed out.
It is the contention of the petitioner union that the creation of three (&$
separate #ar7ainin7 units, one each for Ca#uyao "tis and San +ernando as
ruled #y the respondent Indersecretary, is contrary to the one(co4pany, one(
union policy. It adds that Supervisors level 0 to ) and e=e4pt e4ployees of
the three plants have a si4ilarity or a co44unity of interests.
This Court finds the contention of the petitioner 4eritorious.
n appropriate #ar7ainin7 unit 4ay #e defined as Pa 7roup of e4ployees
of a 7iven e4ployer, co4prised of all or less than all of the entire #ody of
e4ployees, 3hich the collective interest of all the e4ployees, consistent 3ith
e@uity to the e4ployer, indicate to #e #est suited to serve the reciprocal ri7hts
and duties of the parties under the collective #ar7ainin7 provisions of the
la3.Q
L1)M
unit to #e appropriate 4ust effect a 7roupin7 of e4ployees 3ho have
su#stantial, 4utual interests in 3a7es, hours, 3or%in7 conditions and other
su#,ects of collective #ar7ainin7.
L15M
It is readily seen that the e4ployees in the instant case have Pco44unity
or 4utuality of interest,Q 3hich is the standard in deter4inin7 the proper
constituency of a collective #ar7ainin7 unit.
L16M
It is undisputed that they all
#elon7 to the 5a7nolia Poultry -ivision of San 5i7uel Corporation. This
4eans that, althou7h they #elon7 to three different plants, they perfor4 3or%
of the sa4e nature, receive the sa4e 3a7es and co4pensation, and 4ost
i4portantly, share a co44on sta%e in concerted activities.
In li7ht of these considerations, the Solicitor 9eneral has opined that
separate #ar7ainin7 units in the three different plants of the division 3ill
fra74enti6e the e4ployees of the said division, thus 7reatly di4inishin7 their
#ar7ainin7 levera7e. ny concerted activity held a7ainst the private
respondent for a la#or 7rievance in one #ar7ainin7 unit 3ill, in all pro#a#ility,
not create 4uch i4pact on the operations of the private respondent. The t3o
other plants still in operation can 3ell step up their production and 4a%e up for
the slac% caused #y the #ar7ainin7 unit en7a7ed in the concerted
activity. This situation 3ill clearly frustrate the provisions of the !a#or Code
and the 5andate of the Constitution.
L1AM
The fact that the three plants are located in three different places, na4ely,
in Ca#uyao, !a7una, in "tis, Pandacan, 5etro 5anila, and in San +ernando,
Pa4pan7a is i44aterial. 9eo7raphical location can #e co4pletely
disre7arded if the co44unal or 4utual interests of the e4ployees are not
sacrificed as de4onstrated in IP v. Calle,a(+errer 3here all non(acade4ic
ran% and file e4ployees of the Iniversity of the Philippines in-ili4an, Nue6on
City, Padre +aura, 5anila, !os .aTos, !a7una and the Gisayas 3ere allo3ed
to participate in a certification election. Ce rule that the distance a4on7 the
three plants is not productive of insur4ounta#le difficulties in the
ad4inistration of union affairs. /either are there re7ional differences that are
li%ely to i4pede the operations of a sin7le #ar7ainin7 representative.
1;EREFORE, the assailed "rder of 5arch 00, 022& is here#y SET
SI-E and the "rder of the 5ed(r#iter on -ece4#er 02, 022* is
REI/STTE- under 3hich a certification election a4on7 the supervisors
(level 0 to )$ and e=e4pt e4ployees of the San 5i7uel Corporation 5a7nolia
Poultry Products Plants of Ca#uyao, San +ernando, and "tis as one
#ar7ainin7 unit is ordered conducted.
SO OR!ERE!.
Regala)o, IC(airmanJ, Puno, 3en)o,a, and "orres, *r., **., concur
Ca&' "o 15
G.R. No. L%22228 F'./7a/y 27, 19*9
P;ILIPPINE ASSOCIATION OF LAOR 3NIONS (PAFL3) SOCIAL SEC3RITY SYSTEM
EMPLOYEES ASSOCIATION%PAFL3, AL FAJAR!O AN! ALL T;E OT;ER MEMERS AN!
OFFICERS OF T;E SOCIAL SEC3RITY AN! EMPLOYEES ASSOCIATION%PAFL3, petitioners,
vs.
T;E SECRETARY OF LAOR, T;E !IRECTOR OF LAOR RELATIONS a"# T;E REGISTRAR
OF LAOR ORGANI0ATIONS, respondents.
Cipriano Ci) an) Associates an) Israel Bocobo or petitioners.
'ice o t(e .olicitor -eneral Arturo A. Alari, an) .olicitor Camilo %. Guiason or respon)ents.
CONCEPCION, C.J.:
Petitioners pray for 3rits of certiorari and prohi#ition to restrain respondents, the Secretary of !a#or,
the -irector of !a#or Relations and the Re7istrar of !a#or "r7ani6ations, fro4 enforcin7 an order of
cancellation of the re7istration certificate of the Social Security Syste4 E4ployees ssociation B
hereinafter referred to as the SSSE B 3hich is affiliated to the Philippine ssociation of +ree !a#or
Inions B hereinafter referred to as P+!I B as 3ell as to annul all proceedin7s in connection 3ith
said cancellation and to prohi#it respondents fro4 enforcin7 Section 1& of Repu#lic ct /o. 'A5.
Petitioners, li%e3ise, pray for a 3rit of preli4inary in,unction pendin7 the final deter4ination of this
case. In their ans3er, respondents traversed so4e alle7ations of fact and the le7al conclusions
4ade in the petition. /o 3rit of preli4inary in,unction pen)ente lite has #een issued.
It appears that on Septe4#er 15, 026&, the Re7istration of !a#or "r7ani6ations B hereinafter
referred to as the Re7istrar B issued a notice of hearin7, on "cto#er 0A, 026&, of the 4atter of
cancellation of the re7istration of the SSSE, #ecause of8
0. +ailure to furnish the .ureau of !a#or Relations 3ith copies of the reports on the finances
of that union duly verified #y affidavits 3hich its treasurer or treasurers rendered to said
union and its 4e4#ers coverin7 the periods fro4 Septe4#er 1), 026* to Septe4#er 1&,
0260 and Septe4#er 1), 0260 to Septe4#er 1&, 0261, inclusive, 3ithin si=ty days of the 1
respective latter dates, 3hich are the end of its fiscal year; and
1. +ailure to su#4it to this office the na4es, postal addresses and non(su#versive affidavits
of the officers of that union 3ithin si=ty days of their election in "cto#er (0st Sunday$, 0260
and 026&, in confor4ity 3ith rticle IG (0$ of its constitution and #y(la3s.
in violation of Section 1& of Repu#lic ct /o. 'A5. Counsel for the SSSE 4oved to postpone the
hearin7 to "cto#er 10, 026&, and to su#4it then a 4e4orandu4, as 3ell as the docu4ents specified
in the notice. The 4otion 3as 7ranted, #ut, no#ody appeared for the SSSE on the date last
4entioned. The ne=t day, "cto#er 11, 026&, 5anuel Gilla7racia, ssistant Secretary of the SSSE
filed 3ith the "ffice of the Re7istrar, a letter dated "cto#er 10, 026&, enclosin7 the follo3in78
0. Joint non(su#versive affidavit of the officers of the SSS E4ployeesH ssociation(P+!I;
1. !ist of ne3ly(elected officers of the ssociation in its 7eneral elections held on pril 12,
026&; and
&. Copy of the a4ended constitution and #y(la3s of the ssociation.
Doldin7
0. That the ,oint non(su#versive affidavit and the list of officers 4entioned in the letter of 5r.
5anuel Gilla7racia 3ere not the docu4ents referred to in the notice of hearin7 and 4ade the
su#,ect 4atter of the present proceedin7; and
1. That there is no iota of evidence on records to sho3 and>or 3arrant the dis4issal of the
present proceedin7.
on "cto#er 1&, 026&, the Re7istrar rendered a decision cancellin7 the SSSEHs Re7istration
Certificate /o. 0(IP062, issued on Septe4#er &*, 026*. Soon later, or on "cto#er 1', 026&, lfredo
+a,ardo, president of the SSSE 4oved for a reconsideration of said decision and prayed for ti4e,
up to /ove4#er 05, 3ithin 3hich to su#4it the re@uisite papers and data. n opposition thereto
havin7 #een filed #y one Paulino Escueta, a 4e4#er of the SSSE, upon the 7round that the latter
had never su#4itted any financial state4ent to its 4e4#ers, said 4otion 3as heard on /ove4#er
1A, 026&. Su#se@uently, or on -ece4#er ), 026&, the Re7istrar issued an order declarin7 that the
SSSE had ?failed to su#4it the follo3in7 re@uire4ents to 3it8
0. /on(su#versive affidavits of 5essrs. Teodoro Sison, lfonso tien6a, Rodolfo Kala4eda,
Ray4undo Sa#ino and /apoleon Pefianco 3ho 3ere elected alon7 3ith others on January
&*, 0261.
1. /a4es, postal addresses and non(su#versive affidavits of all the officers 3ho 3ere
supposedly elected on "cto#er (0st Sunday$, of its constitution and #y(la3s.
and 7rantin7 the SSSE 05 days fro4 notice to co4ply 3ith said re@uire4ents, as 3ell as
4ean3hile holdin7 in a#eyance the resolution of its 4otion for reconsideration.
Pendin7 such resolution, or on -ece4#er 06, the P+!I, the SSSE, lfredo +a,ardo ?and all the
officers and 4e4#ers? of the SSSE co44enced the present action, for the purpose stated at the
#e7innin7 of this decision, upon the 7round that Section 1& of Repu#lic ct /o. 'A5 violates their
freedo4 of asse4#ly and association, and is inconsistent 3ith the Iniversal -eclaration of Du4an
Ri7hts; that it unduly dele7ates ,udicial po3er to an ad4inistrative a7ency; that said Section 1&
should #e dee4ed repealed #y I!"(Convention /o. 'A; that respondents have acted 3ithout or in
e=cess of ,urisdiction and 3ith 7rave a#use of discretion in pro4ul7atin7, on /ove4#er 02, 026&, its
decision dated "cto#er 11, 026&, #eyond the &*(day period provided in Section 1&(c$ of Repu#lic
ct /o. 'A5; that ?there is no appeal or any other plain, speedy and ade@uate re4edy in the ordinary
course of la3?; that the decision co4plained of had not #een approved #y the Secretary of !a#or;
and that the cancellation of the SSSEHs certificate of re7istration 3ould cause irrepara#le in,ury.
The theory to the effect that Section 1& of Repu#lic ct /o. 'A5 unduly curtails the freedo4 of
asse4#ly and association 7uaranteed in the .ill of Ri7hts is devoid of factual #asis. The re7istration
prescri#ed in para7raph (#$ of said section
0
is not a li4itation to the ri7ht of asse4#ly or association,
3hich ma! #e e=ercised 3ith or >it(outsaid re7istration.
1
The latter is 4erely a condition sine 0ua
non for the ac0uisition o legal personalit! #y la#or or7ani6ations, associations or unions and the
possession of the ?ri7hts and privile7es 7ranted #y la3 to le7iti4ate la#or or7ani6ations?. The
Constitution does not 7uarantee these ri7hts and privile7es, 4uch less said personality, 3hich are
4ere statutor! creations, for the possession and e=ercise of 3hich re7istration is re@uired to protect
#oth la#or and the pu#lic a7ainst a#uses, fraud, or i4postors 3ho pose as or7ani6ers, althou7h not
truly accredited a7ents of the union they purport to represent. Such re@uire4ent is a valid e=ercise of
the police po3er, #ecause the activities in 3hich la#or or7ani6ations, associations and union of
3or%ers are en7a7ed affect pu#lic interest, 3hich should #e protected.
&
+urther4ore, the o#li7ation
to su#4it financial state4ents, as a condition for the non(cancellation of a certificate of re7istration,
is a reasona#le re7ulation for the #enefit of the 4e4#ers of the or7ani6ation, considerin7 that the
sa4e 7enerally solicits funds or 4e4#ership, as 3ell as oftenti4es collects, on #ehalf of its
4e4#ers, hu7e a4ounts of 4oney due to the4 or to the or7ani6ation.
)
+or the sa4e reasons, said Section 1& does not i4pin7e upon the ri7ht of or7ani6ation 7uaranteed
in the -eclaration of Du4an Ri7hts, or run counter to rticles 1, ), A and Section 1 of rticle ' of the
I!"(Convention /o. 'A, 3hich provide that ?3or%ers and e4ployers, ... shall have the ri7ht to
esta#lish and ... ,oin or7ani6ations of their o3n choosin7, 3ithout previous authori6ation?; that
?3or%ers and e4ployers or7ani6ations shall not #e lia#le to #e dissolved or suspended #y
ad4inistrative authority?; that ?the ac@uisition of le7al personality #y 3or%ersH and e4ployersH
or7ani6ations, ... shall not #e 4ade su#,ect to conditions of such a character as to restrict the
application of the provisions? a#ove 4entioned; and that ?the 7uarantees provided for in? said
Convention shall not #e i4paired #y the la3 of the land.
In B...P. v. Araos,
5
3e held that there is no inco4pati#ility #et3een Repu#lic ct /o. 'A5 and the
Iniversal -eclaration of Du4an Ri7hts. Ipon the other hand, the cancellation of the SSSEHs
re7istration certificate 3ould not entail a dissolution of said association or its suspension. The
e=istence of the SSSE 3ould not #e affected #y said cancellation, althou7h its ,uridical personality
and its statutory ri7hts and privile7es B as distin7uished fro4 those conferred #y the Constitution B
3ould #e suspended there#y.
To #e re7istered, pursuant to Section 1&(#$ of Repu#lic ct /o. 'A5, a la#or or7ani6ation,
association or union of 3or%ers 4ust file 3ith the -epart4ent of !a#or the follo3in7 docu4ents8
(0$ copy of the constitution and #y(la3s of the or7ani6ation to7ether 3ith a list of all officers
of the association, their addresses and the address of the principal office of the or7ani6ation;
(1$ s3orn state4ent of all the officers of the said or7ani6ation, association or union to the
effect that they are not 4e4#ers of the Co44unist Party and that they are not 4e4#ers of
any or7ani6ation 3hich teaches the overthro3 of the 9overn4ent #y force or #y any ille7al or
unconstitutional 4ethod; and
(&$ If the applicant or7ani6ation has #een in e=istence for one or 4ore years, a copy of its
last annual financial report.
5oreover, para7raph (d$ of said(Section ordains that8
The re7istration and per4it of a le7iti4ate la#or or7ani6ation s(all be cancelle) #y the
-epart4ent of !a#or, if the -epart4ent has reason to #elieve that the la#or or7ani6ation no
longer meets one or more o t(e re0uirements o paragrap( IbJ above; or fails to file 3ith the
-epart4ent !a#or either its inancial report3ithin the si=ty days of the end of its fiscal year or
the names o its ne> oicers alon7 >it( t(eir non-subversive ai)avits as outlined in
para7raph (#$ a#ove 3ithin si=ty days of their election; ho3ever, the -epart4ent of !a#or
shall not order the cancellation of the re7istration and per4it 3ithout due notice and hearin7,
as provided under para7raph (c$ a#ove and the affected la#or or7ani6ation shall have the
sa4e ri7ht of appeal to the courts as previously provided.
6
The deter4ination of the @uestion 3hether the re@uire4ents of para7raph (#$ have #een 4et, or
3hether or not the re@uisite financial report or non(su#versive affidavits have #een filed 3ithin the
period a#ove stated, is not ,udicial po3er. Indeed, all officers of the 7overn4ent, includin7 those in
the e=ecutive depart4ent, are supposed, to act on the #asis of facts, as they see the sa4e. This is
specially true as re7ards ad4inistrative a7encies 7iven #y la3 the po3er to investi7ate and render
decisions concernin7 details related to the e=ecution of la3s the enforce4ent of 3hich is entrusted
thereto. Dence, spea%in7 for this Court, 5r. Justice Reyes (J...!.$ had occassion to say8
The o#,ections of the appellees to the constitutionality of Repu#lic ct /o. 1*56, not only as
an undue dele7ation of ,udicial po3er to the Secretary of Pu#lic Cor%s #ut also for #ein7
unreasona#le and ar#itrary, are not tena#le. It 3ill #e noted that the ct (R.. 1*56$ 4erely
e4po3ers the Secretary to re4ove unauthori6ed o#structions or encroach4ents upon pu#lic
strea4s, constructions that no private person 3as any3ay entitled to 4a%e #ecause the #ed
of navi7a#le strea4s is pu#lic property, and o3nership thereof is not ac@uira#le #y adverse
possession
(Palanca vs. Co44on3ealth, 62 Phil., ))2$.
It is true that the e=ercise of the SecretaryHs po3er under the ct necessarily involves
the )etermination o some 0uestion o act, such as the e=istence of the strea4 and its
previous navigable c(aracter; #ut these functions, 3hether ,udicial or @uasi(,udicial, are
4erely incidental to the e=ercise of the po3er 7ranted #y la3 to clear navi7a#le strea4s of
unauthori6ed o#structions or encroach4ents, and aut(orities are clear t(at t(e! are vali)l!
conerable upon e2ecutive oicials provided the party affected is 7iven opportunity to #e
heard, as is e=pressly re@uired #y Repu#lic ct /o. 1*56, section 1.
A
It should #e noted also, that, ad4ittedly, the SSSE had not filed the non(su#versive affidavits of
so4e of its officers B ?5essrs. Sison, Tolentino, tien6a, Kala4eda, Sa#ino and Pefianca? B
althou7h said or7ani6ation avers that these persons ?3ere either resi7ned or out on leave as
directors or officers of the union?, 3ithout specifyin7 3ho had resi7ned and 3ho 3ere on leave. This
aver4ent is, 4oreover, controverted #y respondents herein.
7ain, the &*(day period invo%ed #y the petitioners is inapplica#le to the decision co4plained of.
Said period is prescri#ed in para7raph (c$
'
of Section 1&, 3hich refers to the proceedin7s for the
?re7istration? of la#or or7ani6ations, associations or unions not to the ?cancellation? of said
re7istration, 3hich is 7overned #y the a#ove@uoted para7raph (d$ of the sa4e section.
Independently of the fore7oin7, 3e have repeatedly held that le7al provisions prescri#in7 the period
3ithin 3hich a decision should #e rendered are directory, not 4andatory in nature B in the sense
that, a ,ud74ent pro4ul7ated after the e=piration of said period is not null and void, althou7h the
officer 3ho failed to co4ply 3ith la3 4ay #e dealt 3ith ad4inistratively, in conse@uence of his
delay
2
B unless the intention to the contrary is 4anifest. Such, ho3ever, is not the i4port of said
para7raph (c$. In the lan7ua7e of .lac%8
Chen a statute specifies the ti4e at or 3ithin 3hich an act is to #e done #y a pu#lic officer or
#ody, it is 7enerally held to #e )irector! onl! as to t(e time, and not 4andatory, unless ti4e is
of the essence of the thin7 to #e done, or the lan7ua7e of the statute contains ne7ative
3ords, or sho3s that the desi7nation of the ti4e 3as intended as a li4itation of po3er,
authority or ri7ht.
0*
Then, a7ain, there is no la3 re@uirin7 the approval, #y the Secretary of !a#or, of the decision of the
Re7istrar decreein7 the cancellation of a re7istration certificate. In fact, the lan7ua7e of para7raph
(d$ of Section 1&, su77ests that, once the conditions therein specified are present, the office
concerned ?shall? have no choice #ut to issue the order of cancellation. 5oreover, in the case at #ar,
there is nothin7, as yet, for the Secretary of !a#or to approve or disapprove, since petitioners,
4otion for reconsideration of the Re7istrarHs decision of "cto#er 1&, 026&, is still pendin7 resolution.
In fact, this circu4stance sho3s, not only that the present action is pre4ature,
00
#ut, also, that
petitioners have failed to e=haust the ad4inistrative re4edies availa#le to the4.
01
Indeed, they could
as% the Secretary of !a#or to disapprove the Re7istrarHs decision or o#,ect to its e=ecution or
enforce4ent, in the a#sence of approval of the for4er, if the sa4e 3ere necessary, on 3hich 3e
need not and do not e=press any opinion.
I/ GIEC "+ TDE +"RE9"I/9, the petition herein should #e, as it is here#y dis4issed, and the
3rits prayed for denied, 3ith costs a7ainst the petitioners. It is so ordered. l a>p(i?.nKt
Reyes, J...!., -i6on, 5a%alintal,. Kaldivar, Sanche6, Castro, +ernando, Capistrano, Teehan%ee and
.arredo, JJ., concur.
Case No 11