1
XII. RIGHT TO SELF-ORGANIZATION
213 SAN MIGUEL FOODS, INCORPORATED
VS SAN MIGUEL CORPORATION
SUPERVISORS and EXEMPT UNION G.R. No.
146206
FACTS:
In the case of San Miguel Corporation
Supervisors and Exempt Union v. Laguesma, the
Court held that even if they handle confidential
data regarding technical and internal business
operations, supervisory employees 3 and 4 and
the exempt employees of petitioner San Miguel
Foods, Inc. are not to be considered confidential
employees, because the same do not pertain to
labor relations, particularly, negotiation and
settlement of grievances. Consequently, they
were allowed to form an appropriate bargaining
unit for the purpose of collective bargaining. The
Court also declared that the employees belonging
to the three different plants of San Miguel
Corporation Magnolia Poultry Products Plants in
Cabuyao, San Fernando, and Otis, having
community or mutuality of interests, constitute a
single bargaining unit.
A certification election was conducted. On
the date of the election, petitioner filed the
Omnibus Objections and Challenge to Voters,
questioning the eligibility to vote by some of its
employees on the grounds that some employees
do not belong to the bargaining unit which
respondent seeks to represent or that there is no
existence of employer-employee relationship with
petitioner.
Based on the results of the election, the
Med-Arbiter issued the Order stating that since the
Yes vote received 97% of the valid votes cast,
respondent is certified to be the exclusive
bargaining agent of the supervisors and exempt
employees of petitioner's Magnolia Poultry
Products Plants in Cabuyao, San Fernando, and
Otis.
On appeal, the then Acting DOLE
Undersecretary, in the Resolution, affirmed the
Order of the Med-Arbiter.
CA affirmed the Resolution of DOLE
Undersecretary with modification stating that
those holding the positions of Human Resource
Assistant and Personnel Assistant are excluded
from the bargaining unit.
Hence, this petition by the San Miguel
Foods
ISSUE:
1. W/N CA departed from jurisprudence
when it expanded the scope of the
bargaining unit when it included
employees who do not belong to or who
are not based in its Cabuyao pr San
Fernando Plants
2. W/N A PAYROLL MASTER IS A
CONFIDENTIAL EMPLOYEE AND THUS
BE EXCLUDED IN THE CBA
RULING:
1. No. In San Miguel vs Laguesma, the
Court explained that the employees of
San Miguel Corporation Magnolia Poultry
Products Plants of Cabuyao, San
Fernando, and Otis constitute a single
bargaining unit, which is not contrary to
the one-company, one-union policy. An
appropriate bargaining unit is defined
as a group of employees of a given
employer, comprised of all or less than all
of the entire body of employees, which the
collective interest of all the employees,
consistent with equity to the employer,
indicate to be best suited to serve the
reciprocal rights and duties of the parties
under the collective bargaining provisions
of the law.
It held that while the existence of a
bargaining history is a factor that may be
reckoned with in determining the

appropriate bargaining unit, the same is
not decisive or conclusive. Other factors
must be considered. The test of grouping
is community or mutuality of interest. This
is so because the basic test of an
asserted bargaining unit’s acceptability is
whether or not it is fundamentally the
combination which will best assure to all
employees the exercise of their collective
bargaining rights. Certainly, there is a
mutuality of interest among the
employees. Their functions mesh with
one another. One group needs the other
in the same way that the company needs
them both. There may be differences as
to the nature of their individual
assignments, but the distinctions are not
enough to warrant the formation of a
separate bargaining unit.
The Court affirms the finding of the CA
that there should be only one bargaining
unit for the employees in Cabuyao, San
Fernando, and Otis of Magnolia Poultry
Products Plant involved in dressed
chicken processing and Magnolia Poultry
Farms engaged in live chicken
operations. Certain factors, such as
specific line of work, working conditions,
location of work, mode of compensation,
and other relevant conditions do not affect
or impede their commonality of interest.
Although they seem separate and distinct
from each other, the specific tasks of each
division are actually interrelated and there
exists mutuality of interests which
warrants the formation of a single
bargaining unit.
2. No. Confidential employees are defined
as those who (1) assist or act in a
confidential capacity, in regard (2) to
persons who formulate, determine, and
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effectuate management policies in the
field of labor relations. The two criteria are
cumulative, and both must be met if an
employee is to be considered a
confidential employee - that is, the
confidential relationship must exist
between the employee and his
supervisor, and the supervisor must
handle the prescribed responsibilities
relating to labor relations. The CA
correctly held that the position of Payroll
Master does not involve dealing with
confidential labor relations information in
the course of the performance of his
functions. Since the nature of his work
does not pertain to company rules and
regulations and confidential labor
relations, it follows that he cannot be
excluded from the subject bargaining unit.
DISPOSITIVE:
Respondent won
NOTE:
It bears stressing that a certification
election is the sole concern of the workers; hence,
an employer lacks the personality to dispute the
same. The general rule is that an employer has
no standing to question the process of certification
election, since this is the sole concern of the
workers. Law and policy demand that employers
take a strict, hands-off stance in certification
elections. The bargaining representative of
employees should be chosen free from any
extraneous influence of management. A labor
bargaining representative, to be effective, must
owe its loyalty to the employees alone and to no
other. he only exception is where the employer
itself has to file the petition pursuant to Article 258
of the Labor Code because of a request to bargain
collectively.

214-215 CIRTEK EMPLOYEES LABOR UNION-
FEDERATION OF FREE WORKERS,
Petitioner, v. CIRTEK ELECTRONICS, INC.,
Respondent.
FACTS:
Prior to the 3rd year of the CBA of
respondent and petitioner, the parties
renegotiated its economic provisions but failed to
reach a settlement, particularly on the issue of
wage increases. Petitioner thereupon declared a
bargaining deadlock and filed a Notice of Strike.
Respondent, upon the other hand, filed a Notice
of Lockout.
In the meantime, as amicable settlement
of the CBA was deadlocked, petitioner went on
strike. The Secretary of Labor assumed
jurisdiction over the controversy and issued a
Return to Work Order which was complied with.
Before the Secretary of Labor could rule
on the controversy, respondent created a Labor
Management Council through which it concluded
with the remaining officers of petitioner a
Memorandum of Agreement providing for daily
wage increases.
The Secretary of Labor resolved the
CBA deadlock by awarding a wage increase.
Respondent avers the following:
a. The MOA signed by the remaining officers
of petitioner Union and allegedly ratified
by its members should have been given
credence by the Court.
b. A resolution of disaffiliation from the
Federation of Free Workers resulting in
the latters lack of personality to represent
the workers in the present case.
The appellate court ruled in favor of
respondent and accordingly set aside the Decision
of the Secretary of Labor. It held that the Secretary
of Labor gravely abused his discretion in not
respecting the MOA.
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ISSUE:
1. W/N the disaffiliation of the union with
FFW warrants the reversal of the
Decision?
2. Whether or not the Secretary of Labor is
authorized to give an award higher than
that agreed upon in the MOA?
HELD
1. NO. Whether there was a valid
disaffiliation is a factual issue. A local
union may disaffiliate at any time from its
mother federation, absent any showing
that the same is prohibited under its
constitution or rule. Such, however, does
not result in it losing its legal personality
altogether. A local union does not owe its
existence to the federation with which it is
affiliated. It is a separate and distinct
voluntary association owing its creation to
the will of its members. The mere act of
affiliation does not divest the local union
of its own personality, neither does it give
the mother federation the license to act
independently of the local union. It only
gives rise to a contract of agency where
the former acts in representation of the
latter.
2. It is well-settled that the Secretary of
Labor, in the exercise of his power to
assume jurisdiction under Art. 263 (g) of
the Labor Code, may resolve all issues
involved in the controversy including the
award of wage increases and benefits.
While an arbitral award cannot per se be
categorized as an agreement voluntarily
entered into by the parties because it
requires the intervention and imposing
power of the State thru the Secretary of
Labor when he assumes jurisdiction, the

arbitral award can be considered an
approximation of a collective bargaining
agreement which would otherwise have
been entered into by the parties, hence, it
has the force and effect of a valid contract
obligation.
That the arbitral award was higher than
that which was purportedly agreed upon
in the MOA is of no moment. For the
Secretary, in resolving the CBA deadlock,
is not limited to considering the MOA as
basis in computing the wage increases.
He could, as he did, consider the financial
documents submitted by respondent as
well as the parties bargaining history and
respondent’s financial outlook and
improvements as stated in its website.
It bears noting that since the filing and
submission of the MOA did not have
the effect of divesting the Secretary of
his jurisdiction, or of automatically
disposing the controversy, then neither
should the provisions of the MOA restrict
the Secretary’s leeway in deciding the
matters before him.
While a contract constitutes the law
between the parties, this is so in the
present case with respect to the CBA, not
to the MOA in which even the unions
signatories had expressed reservations
thereto. But even assuming arguendo that
the MOA is treated as a new CBA, since
it is imbued with public interest, it must be
construed liberally and yield to the
common good.
While the terms and conditions of a CBA
constitute the law between the parties, it
is not, however, an ordinary contract to
which is applied the principles of law
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governing ordinary contracts. A CBA, as a
labor contract within the contemplation of
Article 1700 of the Civil Code of the
Philippines which governs the relations
between labor and capital, is not merely
contractual in nature but impressed with
public interest, thus, it must yield to the
common good. As such, it must be
construed liberally rather than narrowly
and technically, and the courts must place
a practical and realistic construction upon
it, giving due consideration to the context
in which it is negotiated and purpose
which it is intended to serve.
NOTE:
At all events, the issue of disaffiliation is an
intra-union dispute which must be resolved in a
different forum in an action at the instance of
either or both the FFW and the Union or a rival
labor organization, not the employer.
An intra-union dispute refers to any conflict
between and among union members, including
grievances arising from any violation of the rights
and conditions of membership, violation of or
disagreement over any provision of the unions
constitution and by-laws, or disputes arising from
chartering or disaffiliation of the union.
216 THE HERITAGE HOTEL
MANILA v. NATIONAL UNION OF WORKERS
IN THE HOTEL, RESTAURANT AND ALLIED
INDUSTRIES-HERITAGE HOTEL MANILA
SUPERVISORS CHAPTER (NUWHRAIN-
HHMSC)
FACTS:
Respondents filed a petition for
certification of pre-election with the DOLE. The
Med-Arbiter approved the pre-election. However,
the certification election was delayed, but pushed

through nonetheless. Petitioner filed for
cancellation of the certification due to the failure of
respondent to submit its financial statements to
the Bureau of Labor Relations. The Med-Arbiter
still ruled in favor of respondents. Petitioner
appealed the decision to the regional director of
the DOLE. The Regional director still rendered a
decision in favor of respondents, which prompted
petitioners to appeal the decision to the director of
the Bureau of Labor Relations. The director of the
BLR inhibited from the issue, as he was previously
the counsel of respondents. The Secretary of
Labor resolved the issue in the stead of the BLR
director. She ruled in favor of respondents. The
petitioner filed a motion for reconsideration of the
decision, but was turned down. Petitioner then
filed for certiorari, challenging the jurisdiction of
the DOLE Secretary. An appeal from the decision
of the Regional Director is supposed to be under
the jurisdiction of the BLR. Also, petitioner claims
to have been deprived of due process as it was not
informed of the inhibition of the BLR director.
ISSUES:
Is the ruling of the secretary of labor
valid?
Was petitioner deprived of due
process?
HELD:
It is without question that the appeal from
the decision of the regional office is within the
jurisdiction of the BLR. Given the circumstances,
the BLR director inhibited himself. Petitioner
insists that the case should have gone to the
subordinates of the BLR director. However, this
happens in cases where the director is
incapacitated. This does not obtain as the director
merely inhibited himself. On the other hand, the
Secretary of DOLE has powers of supervision
and control over the BLR. As such, it may validly
step into the shoes of the BLR director and resolve
the issue.
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The concept of due-process is different
in proceedings before the courts, and before
administrative agencies. For the latter, the
essence is the opportunity to be heard. In this
case, the petitioner was able to file a motion for
reconsideration on the decision of the DOLE
Secretary, albeit was denied. Petitioner was given
due-process, and its contention that it was
unaware of the inhibition of the BLR director is of
no moment.
NOTE:
Jurisdiction to review the decision of the Regional
Director lies with the BLR. This is clearly provided
in the Implementing Rules of the Labor Code and
enunciated by the Court in Abbott.
In this case, the BLR Director inhibited himself
from the case because he was a former counsel
of respondent. Who, then, shall resolve the case
in his place?
In Abbott, the appeal from the Regional Directors
decision was directly filed with the Office of the
DOLE Secretary, and we ruled that the latter has
no appellate jurisdiction. In the instant case, the
appeal was filed by petitioner with the BLR, which,
undisputedly, acquired jurisdiction over the case.
Once jurisdiction is acquired by the court, it
remains with it until the full termination of the case.
217 SAMAHANG MANGGAGAWA SA
CHARTER CHEMICAL SOLIDARITY OF
UNIONS IN THE PHILIPPINES FOR
EMPOWERMENT AND REFORMS (SMCC-
SUPER), ZACARRIAS JERRY VICTORIO
Union President, Petitioner, v. CHARTER
CHEMICAL AND COATING CORPORATION,
Respondent.
FACTS:

Samahang Manggagawasa Charter
Chemical Solidarity of Unions in the Philippines for
Empowerment and Reforms (petitioner union)
filed a petition for certification election among the
regular rank-and-file employees of Charter
Chemical and Coating Corporation (respondent
company) with the Mediation Arbitration Unit of the
DOLE. Respondent company opposed on the
ground that petitioner union is not a legitimate
labor organization because of failure to comply
with the documentation requirements set by law
the charter certificate was not executed under
oath, and the inclusion of supervisory employees
within petitioner union. The Med-Arbiter
dismissed the petition. The DOLE, on appeal,
granted the petition for certification election but the
CA reversed the DOLE decision. The appellate
court gave credence to the findings of the Med-
Arbiter.
Petitioner union claims that the litigation of
the issue as to its legal personality to file the
subject petition for certification election is barred
by the Decision of the DOLE. In this decision, the
DOLE ruled that petitioner union complied with all
the documentation requirements and that there
was no independent evidence presented to prove
an illegal mixture of supervisory and rank-and-file
employees in petitioner union. After the
promulgation of this Decision, respondent
company did not move for reconsideration, thus,
this issue must be deemed settled.
ISSUE:
Whether or not petitioner union has legal
personality to file for a petition for certification
election.
HELD:
The right to file a petition for certification
election is accorded to a labor organization
provided that it complies with the requirements of
law for proper registration. The inclusion of
supervisory employees in a labor organization
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seeking to represent the bargaining unit of rank-
and-file employees does not divest it of its status
as a legitimate labor organization.
Petitioner unions charter certificate need
not be executed under oath. Consequently, it
validly acquired the status of a legitimate labor
organization upon submission of (1) its charter
certificate,(2) the names of its officers, their
addresses, and its principal office,and (3) its
constitution and by-laws the last two requirements
having been executed under oath by the proper
union officials as borne out by the records.
Petitioner union correctly argues that its
legal personality cannot be collaterally attacked in
the certification election proceedings.
NOTE:
The applicable law and rules in the instant case
are the same as those in Kawashima because
the present petition for certification election was
filed in 1999 when D.O. No. 9, series of 1997,
was still in effect.
On June 21, 1997, the 1989 Amended Omnibus
Rules was further amended by Department Order
No. 9, series of 1997 (1997 Amended Omnibus
Rules). Specifically, the requirement under Sec.
2(c) of the 1989 Amended Omnibus Rules that
the petition for certification election indicate
that the bargaining unit of rank-and-file
employees has not been mingled with
supervisory employees was removed. Instead,
what the 1997 Amended Omnibus Rules requires
is a plain description of the bargaining unit