ADDENDUM
POWER INTERRUPTIONS/BROWN-OUT
The following are the effects of work interruptions
due to brownouts:
1. Brown-outs of short duration but not exceeding
twenty (20) minutes shall be treated as worked
or compensable hours whether used
productively or not (Policy Instruction No. 36,
May 22, 1978).
2. Brown-out running more than twenty minutes
may not be treated as hours worked provided
any of the following conditions are present:
a. The employees can leave their workplace
or go elsewhere whether within and
outside the work premises; or
b. The employees can use the time effectively
for their own interest (Chan, 2017).
3. In each case, the employer may extend the
working hours of his employees outside the
regular schedules to compensate for the loss of
productive man-hours without being liable for
overtime pay (Chan, 2017).
4. Industrial enterprises with one or two
workshifts may adopt any of the workshifts
prescribed for enterprises with three
workshifts to prevent serious loss or damage to
materials, machineries, or equipment that may
result in case of power interruption (Policy
Instruction No. 36, May 22, 1978).
5. The days when work was not required and no
work could be done because of shutdown due to
electrical power interruptions, lack of raw
materials and repair of machines, are not
deemed hours worked (Durabit Recapping
Plant Company v. NLRC, G.R. No. L-76746, July
27, 1987).
6. When a CBA contains a reporting time-off
provision wherein employees who have
reported for work but unable to continue
because of emergencies such as typhoons, flood,
earthquake and transportation strike shall also
mean to include brownout or power outage
because the key element of the provision is that
employees who have reported for work are
unable to continue working because of the
incident. Hence employees who were
prevented to continue their work due to
brownout should also be remunerated.
(Supreme Steel Corporation v. Nagkakaisang
Manggagawa ng Supreme Independent Union,
G.R. 185556, March 28, 2011)
EXCLUSIVE BARGAINING REPRESENTATION
AND WORKER’S PARTICIPATION IN POLICY
AND DECISION-MAKING
Bargaining representative of the Ees for
purposes of collective bargaining
The labor organization designated or selected by
the majority of the Ees in an appropriate collective
bargaining unit shall be the exclusive representative
of the Ees in such unit for the purpose of CB.
However, an individual Ee or group of Ees shall have
the right at any time to present grievances to their
Er. [LC, Art. 267 (formerly Art. 255) as amended by
Sec 22 of R.A. No. 6715, Sec. 22 (1989)]
Sole and Exclusive Bargaining Agent (SEBA)
It refers to a legitimate labor union duly certified as
the sole and exclusive bargaining representative or
agent of the all the employees in the Collective
Bargaining Unit (CBU). A labor union certified as
SEBA means that it shall remain as such during the
existence of the CBA, to the exclusion of all other
labor organizations existing and operating in the
same CBU and no petition for certification
questioning its majority status shall be entertained
nor shall certification election be conducted outside
of the CBA. (Trade Unions of the Philippine/February
Six Movement v. Laguesma, G.R. No. 95013, Sept. 21,
1994)
Rule on solicitation of questions, suggestions
and complaints by the Er from the Ees who are
represented by a union
GR: The Er may not solicit questions, suggestions
and complaints from Ees who are represented by a
union.
XPN:
1. The CB representative executes an agreement
waiving the right to be present on any occasion
when Ee grievances are being adjusted by the
Er; and
2. Er acts strictly within the terms of his waiver
agreement.
Q: The hotel union filed a Notice of Strike with
the National Conciliation and Mediation Board
(NCMB) due to an unfair labor practice against
the Diamond Hotel who refused to bargain with
it. The hotel advised the union that since it was
not certified by the DOLE as the exclusive
bargaining agent, it could not be recognized as
such. The union sought to bargain for members
only. May the Union bargain collectively?
A: NO. Art. 267 (formerly Art. 255) of the LC
declares that only the labor organization designated
or selected by the majority of the Ees in an
appropriate CB unit is the exclusive representative
of the Ees in such unit for the purpose of CB. The
1
 LABOR LAW AND SOCIAL LEGISLATION
union is admittedly not the exclusive representative
of the majority of the Ees of the hotel, hence, it could
not demand from the hotel the right to bargain
collectively in their behalf. (Manila Diamond Hotel v.
Manila Diamond Hotel Ees Union, G.R. No. 158075,
June 30, 2006)
---
Principle of Codetermination or co-sharing
(2007 Bar Question)
It refers to the right of workers to participate in
policy and decision-making process affecting their
rights and benefits. (PAL v. NLRC, G.R. No. 85985,
August 13, 1993; 1987 Constitution, Art. XIII, Sec. 3)
Extent of the worker’s right to participate in
policy and decision-making processes in a
company
Such right refers not only to formulation of
corporate programs and policies but also to
participation in grievance procedures and
voluntary modes of settling disputes.
Q: Does the worker’s right to participate in
policy and decision-making process as provided
under Art. XIII, Sec. 13 of the 1987 Constitution
include membership in the Board of Directors of
a corporation? (2008 Bar Question)
A: NO. The SC recognized the right of the union to
participate in policy formulation and decision-
making process on matters affecting the union
members’ rights, duties and welfare. However, such
participation of the union in committees of the Er is
not in the nature of a co-management control of the
business. Impliedly, therefore, workers’
participatory right in policy and decision-making
processes does not include the right to put a union
member in a corporation’s Board of Directors.
(Manila Electric Company v. Quisumbing, G.R. No.
127598, January 27, 1999)
Q: May the management be compelled to share
with the union or its employees its prerogative
of formulating a Code of Discipline?
A: YES. The management may be compelled to do so.
The Code of Discipline involves security of tenure
and loss of employment — a property right. It is
time that management realizes that to attain
effectiveness in its conduct rules, there should be
candidness and openness by Management and
participation by the union, representing its
members. In fact, our Constitution has recognized
the principle of shared responsibility between Ers
and workers and has likewise recognized the right
of workers to participate in policy and decision-
2
making process affecting their rights. (PAL v. NLRC,
G.R. No. 85985, August 13. 1993)
PROPER BARGAINING UNIT
It is a group of Ees of a given Er, comprised of all or
less than all of the entire body of the Ees which the
collective interest of all the Ees consistent with
equity to the Er, indicate to be best suited to serve
the reciprocal rights and duties of the parties under
the collective bargaining provisions of the law.
TEST TO DETERMINE THE CONSTITUENCY OF
AN APPROPRIATE BARGAINING UNIT
Factors/tests considered in determining the
appropriateness of a bargaining unit
1. Will of the Ees (Globe Election Doctrine)
2. Prior CB history (Collective Bargaining History
Doctrine)
3. Similarity of employment status (Employment
Status Doctrine)
4. Affinity and unity of the Ees’ interest, such as
substantial similarity of work and duties, or
similarity of compensation and working
conditions (Substantial or Mutuality of Interest
Doctrine / Community of Interest Rule)
Globe Election Doctrine
In defining the appropriate bargaining unit, the
determining factor is the express will of the workers
which is the inherent and basic right to self-
organization.
Collective Bargaining History Doctrine
In determining the appropriate bargaining unit,
prior CB history and affinity of the Ees may be
resorted to.
Employment Status Doctrine
The determination of the appropriate bargaining
unit is based on the employment status of the Ees.
Substantial or Mutuality of Interest Doctrine
The Ees sought to be represented by the CB agent
must have substantial mutual interest in terms of
employment and working condition as evinced by
the type of work they perform. (San Miguel Corp.
Employees Union-PTGWO v. Confesor, G.R. No.
111262, September 19, 1996)
Factors considered in determining the
Substantial or Mutuality Interest Doctrine
 ADDENDUM
1. Similarity in the scale and manner of
determining earnings
2. Similarity in employment benefits, hours of
work, and other terms and conditions of
employment
3. Similarity in the kinds of work performed
4. Similarity in the qualifications, skills and
training of Ees
5. Frequency of contract or interchange among
the Ees
6. Geographical proximity
7. Continuity and integration of production
processes
8. Common supervision and determination of
labor-relations policy
9. History of CB
10. Desires of the affected Ees or
11. Extent of union organization
---
Q: Samahang Tunay, a union of rank-and-file
employees lost in a certification election at
Solam Company and has become a minority
union. The majority union now has a signed CBA
with the company and the agreement contains a
maintenance of membership clause.
What can Samahang Tunay still do within the
company as a union considering that it still has
members who continue to profess continued
loyalty to it? (2013 Bar Questions)
A: Basis: Article 248 (formerly Art. 242) of the Labor
Code. As a legitimate labor organization, it can
continue to represent its members on non-CBA-
related matters.
---
---
Q: A registered labor union in UP, ONAPUP, filed
a petition for certification election among the
non-academic employees. The university did
not oppose, however, another labor union, the
All UP Workers Union assents that it represents
both academic and non-academic personnel and
seeks to unite all workers in one union. Do
employees performing academic functions need
to comprise a bargaining unit distinct from that
of the non-academic employees?
A: YES. The mutuality of interest test should be
taken into consideration. There are two classes of
rank and file Ees in the university, those who
perform academic functions such as the professors
and instructors, and those whose function are non-
academic who are the janitors, messengers, clerks
etc. Thus, not much reflection is needed to perceive
that the mutuality of interest which justifies the
formation of a single bargaining unit is lacking
between the two classes of Ees. (U.P. v. Ferrer-
Calleja, G.R. No.96189, July 14, 1992)
3
---
Bargaining history not a decisive factor in the
determination of appropriateness of bargaining
unit
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 interests. 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 Ees the exercise of their
CB rights. (Democratic Labor Association v. Cebu
Stevedoring Company, Inc., G.R. No. L-10321,
February 28, 1958)
“One-company, One-union” Policy
GR: All the rank-and-file Ees with substantially the
same interests and who invoke the right to self-
organization are part of a single unit so that they can
deal with their Er with just one and potent voice.
The Ees’ bargaining power is strengthened thereby.
(General Rubber and Footwear Corporation v.
Bureau of Labor Relations, et al., G.R. No. 74262,
October 29, 1987)
XPNs:
1. Supervisory Ees who are allowed to form their
own unions apart from the rank-and-file Ees
and
2. Craft Unit – bargaining unit composed of
employees of the company with the same
occupation, such as pilots as distinguished from
ground personnel
3. Plant Unit – bargaining unit composed of
employees in a particular plant of the company,
such as the company’s Cebu plant as
distinguished from its Ilocos Plant.
The main consideration in a plant unit is
geographical while it is occupational in a craft unit.
(Alcantara, 2008)
NOTE: The policy should yield to the right of Ees to
form union for purposes not contrary to law, self-
organization and to enter into CB negotiations.
Two companies cannot be treated into a single
bargaining unit even if their businesses are related.
Corporate spin-off
Subsidiaries or corporations formed out of former
divisions of a mother company following a re-
 LABOR LAW AND SOCIAL LEGISLATION
organization may constitute a separate bargaining
unit.
---
Q: Union filed a petition for certification
election among the rank and file employees of
three security agencies including the Veterans
Security. The latter opposed alleging that the
three security agencies have separate and
distinct corporate personalities. May a single
petition for certification election be filed by a
labor union in the three corporations instead of
filing three separate petitions?
A: YES. The following are indications that the three
agencies do not exist and operate separately and
distinctly from each other with different corporate
direction and goals: 1) Veterans Security failed to
rebut the fact that they are managed through the
Utilities Management Corporation with all their
employees drawing their salaries and wages from
the said entity; 2) that the agencies have common
and interlocking incorporators and officers; 3) that
they have a single mutual benefit system and
followed a single system of compulsory retirement;
4) they could easily transfer security guards of one
agency to another and back again by simply filling-
up a common pro-forma slip; 5) they always hold
joint yearly ceremonies such as the PGA Annual
Awards Ceremony; and 6) they continue to be
represented by one counsel.
Hence, the veil of corporate fiction of the three
agencies should be lifted for the purpose of allowing
the Ees of the three agencies to form single union.
As a single bargaining unit, the Ees need not file
three separate PCE. (Philippine Scout Veterans
Security and Investigation Agency v. SLE, G.R. No.
92357, July 21, 1993)
---
---
Q: Company XYZ has two recognized labor
unions, one for its rank-and-file employees and
the other for its supervisory employees. Of late,
the company instituted a restructuring program
by virtue of which A, a rank-and-file employee
and officer of rank-and-file employees’ labor
union, was promoted to a supervisory position
along with four other colleagues, also active
union members and/or officers. Labor Union
KMJ, a rival labor union seeking recognition as
the rank-and-file bargaining agent, filed a
petition for the cancellation of the registration
of rank-and-file Ees labor union on the ground
that A and her colleagues have remained to be
members of rank-and-file Ees labor union. Is the
petition meritorious? Explain. (2010 Bar
Question)
4
A: NO. The inclusion as union members of Ees
outside the bargaining unit shall not be a ground for
the cancellation of the registration of the union. Said
Ees are automatically deemed removed from the list
of membership of said union.
There are only three grounds for the cancellation of
union registration:
a. Misrepresentation, false statement or fraud in
connection with the adoption or ratification of
the constitution and by-laws or amendments
thereto, the minutes of ratification and the list
of members who took part in the ratification;
b. Misrepresentation, false statements or fraud in
connection with the election of officers, minutes
of the election of officers, and the list of voters;
c. voluntary dissolution by the members (LC, Art.
239 as amended by RA 9481, June 14, 2007)
---
Methods in determining the exclusive
bargaining representative
1. Request for SEBA Certification (DO No. 40-I-15
s. 2015) which repealed Voluntary recognition
as a mode of securing SEBA Status
2. Certification election
3. Consent election
4. Run-off Election
5. Re-run Election
REQUEST FOR SEBA CERTIFICATION
This is a new mode of determining SEBA. D.O. No.
40-I-15, s. 2015 issued on September 07, 2015, has
expressly repealed the entire set of Rules applicable
to Voluntary Recognition in the Implementing Rules
on Book V of the Labor Code. (Chan, 2017)
Rationale for the Repeal
It is an absolute that in an inter-union or
certification/representation dispute, an employer is
a mere by-stander and not considered as a party
thereto with a concomitant right to oppose a
petition for petition for certification election.
Being the sole and exclusive concern and domain of
the employees, the previous mode of allowing the
employer to extend “voluntary recognition”to
enable union to become a SEBA is patently
incongruous and self-contradictory rule that runs
diametrically opposed to the autonomous process
of choosing the SEBA. By allowing the employer to
extend “voluntary recognition” to a union, it is no
longer the employees but the employer who
determines and designates the SEBA when is
suppose to be just a mere “by-stander” in such
determination and designation process (Chan,
2017).
 ADDENDUM
DOCUMENTARY REQUIREMENTS
The Request should be indicate:
1. The name and address of the requesting
legitimate labor organization;
2. The name and address of the company where it
operates;
3. The bargaining unit sought to be represented;
4. The approximate number of the employees in
the bargaining unit; and
5. The statement of the existence/non-existence
of other labor organization/CBA.
Where to file the Request
Any legitimate labor organization may file a Request
in the DOLE Regional Office which issued its
certificate for registration or certificate of creation
of chartered local, as the case may be.
Action on the Request
Within one (1) day from the submission of the
Request, the DOLE Regional Director should:
1.Determine whether the request for is compliant
with the documentary requirements and whether
the bargaining unit sought to be represented is
organized or not; and
2. Request a copy of the payroll for purposes of
SEBA certification.
If the DOLE Regional Director finds the Request
deficient, he should advise the requesting union or
local to comply within 10 days from notice. Non-
compliance shall be deemed withdrawal of the
request (Sec. 3, D.O. 40-1-15, s. 2015)
Scenarios contemplated by the Rules on Request
for Sole and Exclusive Bargaining Agent
Certification
1. Request certification in unorganized
establishment with only one legimate union
The DOLE Regional Director shall call a
conference within five (5) working daays for
the submission of the following:
a. The names of employees in the covered
bargaining unit who signify their support
for the SEBA certification, provided that
said employees comprise at least majority
of the number of employees in the covered
bargaining unit; and
b. Certification under oath by the President
that all document submitted are true and
5
correct based on his/her personal
knowledge.
If the requesting union or local fails to complete the
requirements for the SEBA certification during the
conference, the Request should be referred to the
Election Officer for the conduct of certification
election.
If the DOLE Regional Director finds that the
requirements complete, he shall issue, during the
conference, a Certification as SEBA.
Effect of the Issuance of the Certification as SEBA
a. The certified union shall enjoy all the rights
and privileges of an exclusive bargaining
agent of all the employees in the covered
bargaining unit.
b. Certification Bar Rule. The issuance of the
SEBA Certification as SEBA bars the filing of
a petition election by any labor
organization for a period of one (1) year
from the date of issuance.
2. Request for certification in unorganized
establish with more than one legimitate labor
organization
If the DOLE Regional Director finds that the
establishment unorganized with more than one
legitimate labor organization, he should refer the
same to the Election Officer for the conduct of
certification election (Sec. 5, D.O. No. 40-I-15, s.
2015).
3. Request for certification in organized
establishment
If the DOLE Regional Director finds that the
establishment organized, he should refer the same
to the Mediator-Arbiter for the determination of the
propriety of conducting a certification election.
CERTIFICATION ELECTION
Certification Election (sole concern rule/by-
stander rule)
It is the process of determining through secret ballot
the sole and exclusive representative of the Ees in
an appropriate bargaining unit, for purposes of CB
or negotiation. [IRR, Book V, Rule I, Sec. 1 (h)]
NOTE: The process is called CE because it serves as
the official, reliable and democratic basis for the
BLR to determine and certify the union that shall be
the exclusive bargaining representative of the Ees
for the purpose of bargaining with the Er.
 LABOR LAW AND SOCIAL LEGISLATION
Nature of certification election
A CE is not a litigation but merely an investigation of
a non-adversarial fact-finding character in which
BLR plays a part of a disinterested investigator
seeking merely to ascertain the desire of the Ees as
to the matter of their representation. (Airline Pilots
Association of the Philippines v. CIR, G.R. No. L-33705,
April 15, 1977)
Purpose of a certification election
It is a means of determining the worker’s choice of:
1. Whether they want a union to represent them
for CB or if they want no union to represent
them at all.
2. And if they choose to have a union to represent
them, they will choose which among the
contending unions will be the sole and exclusive
bargaining representative of the Ees in the
appropriate bargaining unit.
Filing a petition for certification election (PCE)
The following may file a PCE:
1. Any LLO
2. A national union or federation which has
already issued a charter certificate to its local
chapter participating in the CE
3. A local chapter which has been issued a charter
certificate
4. An Er only when requested to bargain
collectively in a bargaining unit where no
registered CBA exists. (IRR as amended by D.O.
40-F-03, Book V, Rule VIII, Sec. 1)
NOTE: A national union or federation filing a
petition in behalf of its local/chapter shall not be
required to disclose the names of the
local/chapter’s officers and members, but shall
attach to the petition the charter certificate it issued
to its local/chapter. (IRR as amended by D.O. 40-F-
03, Book V, Rule VIII, Sec. 1)
In registration of federation or national union,
the 20% membership requirement may not be
complied with
The registration requirement of submitting the
names of all its members comprising at least 20% of
all the Ees in the bargaining unit where it seeks to
operate is applicable only to registration of
independent union. LC merely requires for proof of
affiliation of at least 10 local chapters and the names
and addresses of the companies where they operate.
No 20% membership requirement is required for
registration of a federation or national union.
6
NOTE: Under the LC and the rules, the power
granted to labor organizations to directly create a
chapter or local through chartering is given to a
federation or national union only, not to a trade
union center. (SMCEU v. San Miguel Packaging
Products Employees Union, G.R. No. 171153,
September 12, 2007)
Employer may file a petition for certification
election
Er may file a petition for certification election when
requested to bargain collectively. But thereafter it
should not be allowed to have an active role in the
CE; it shall merely act as a bystander.
CE proceeding is not a litigation, but a mere
summary and non-litigious proceeding. The only
purpose is to ascertain the will of the parties in
determining who will be the bargaining agent.
Double Majority rule (certification election)
1. Valid election – majority of eligible voters shall
have validly cast their votes (First Majority
rule).
2. Winning Union – the winner who obtained
majority of the valid votes casts shall be
declared as the bargaining agent in the
bargaining unit (Second Majority rule).
---
Q: Liwayway Glass had 600 rank-and-file
employees. Three rival unions A, B, and C ‒
participated in the certification elections
ordered by the Med-Arbiter. 500 employees
voted. The unions obtained the following votes:
A-200; B-150; C-50; 90 employees voted “no
union”; and 10 were segregated votes. Out of the
segregated votes, four (4) were cast by
probationary employees and six (6) were cast by
dismissed employees whose respective cases
are still on appeal. (2014 Bar Question)
a. Should the votes of the probationary and
dismissed employees be counted in the total
votes cast for the purpose of determining
the winning labor union?
b. Was there a valid election?
c. Should Union A be declared the winner?
d. Suppose the election is declared invalid,
which of the contending unions should
represent the rank-and-file employees?
e. Suppose that in the election, the unions
obtained the following votes: A-250; B-150;
C-50; 40 voted “no union”; and 10 were
segregated votes. Should Union A be
certified as the bargaining representative?
 ADDENDUM
A:
a. YES. Rule IX, Section 5 of DOLE Department
Order 40-03 provides that “all employees who
are members of the appropriate bargaining unit
sought to be represented by the petitioner at
the time of the issuance of the order granting
the conduct of a certification election shall be
eligible to vote. An employee who has been
dismissed from work but has contested the
legality of the dismissal in a forum of
appropriate jurisdiction at the time of the
issuance of the order for the conduct of a
certification election shall be considered a
qualified voter, unless his/her dismissal was
declared valid in a final judgment at the time of
the conduct of the certification election.”
b. YES. To have a valid election, at least a majority
of all eligible voters in the unit must have cast
their votes. In the instant case, 500 out of 600
rank-and-file employees voted.
c. NO. The Labor Code provides that the Labor
Union receiving the majority of the valid votes
cast shall be certified as the exclusive
bargaining agent of all the workers in the unit.
Here, the number of valid votes cast is 490;
thus, the winning union should receive at least
246 votes. Union A only received 200 votes.
d. None of them should represent the rank-and-
file employees
e. YES. The Labor Code provides that the Labor
Union receiving the majority of the valid votes
cast shall be certified as the exclusive
bargaining agent of all the workers in the unit
Here, the number of valid votes cast is 490.
Thus, the winning union should receive at least
246 votes; Union A received 250 votes.
---
Employer as a Bystander (Bystander Rule)
In all cases, whether the PCE is filed by an Er or a
LLO, the Er shall not be considered a party thereto
with a concomitant right to oppose a PCE. The Er’s
participation in such proceedings shall be limited
to: (1) being notified or informed of petitions of
such nature; and (2) submitting the list of Ees
during the pre-election conference should the
Mediator-Arbiter act favorably on the petition.
Except when it is requested to bargain collectively,
an Er is a mere bystander to any PCE; such
proceeding is non-adversarial and merely
investigative, for the purpose thereof is to
determine which organization will represent the
Ees in their CB with the Er. The choice of their
representative is the exclusive concern of the Ees;
the Er cannot have any partisan interest therein; it
cannot interfere with, much less oppose, the process
7
by filing a motion to dismiss or an appeal from it; not
even a mere allegation that some Ees participating
in a PCE are actually managerial Ees will lend an Er
legal personality to block the CE. The Er’s only right
in the proceeding is to be notified or informed
thereof. (Republic v. Kawashima Textile, G.R. No.
160352, July 23, 2008)
---
---
Q: May an organization which carries a mixture
of rank-and-file and supervisory employees
possess any of the rights of a legitimate labor
organization, including the right to file a petition
for certification election for the purpose of
collective bargaining?
A: YES. While there is a prohibition against the
mingling of supervisory and rank-and-file
employees in one labor organization, the Labor
Code does not provide for the effects thereof. Thus,
the Court held that after a labor organization has
been registered, it may exercise all the rights and
privileges of a legitimate labor organization. Any
mingling between supervisory and rank-and-file
employees in its membership cannot affect its
legitimacy for that is not among the grounds for
cancellation of its registration, unless such mingling
was brought about by misrepresentation, false
statement or fraud under Article 239 of the Labor
Code. (Republic vs. Kawashima Textile, G.R. No.
160352, July 23, 2008)
---
Issues directly involved in a certification
proceeding
1. Proper composition and constituency of the
bargaining unit; and
2. The veracity of majority membership claims of
the competing unions so as to identity the one
union that will serve as the bargaining
representative of the entire bargaining unit.
NOTE: Some of the Ees may not want to have a
union; hence, “no union” is one of the choices named
in the ballot. If “no union” wins, the company or the
bargaining unit remains un-unionized for at least 12
months, the period is known as 12-month bar. After
that period, a PCE may be filed again.
Five-year representation status of a bargaining
agent cannot be extended
While the parties may agree to extend the CBA’s
original five-year term together with all other CBA
provisions, any such amendment or term in excess
of five years will not carry with it a change in the
union’s exclusive CB status. Under Art. 253-A, LC,
the exclusive bargaining status cannot go beyond
 LABOR LAW AND SOCIAL LEGISLATION
five years and the representation status is a legal
matter not for the workplace parties to agree upon.
In other words, despite an agreement for a CBA with
a life of more than five years, either as an original
provision or by amendment, the bargaining union’s
exclusive bargaining status is effective only for five
years and can be challenged within 60 days prior to
the expiration of the CBA’s first five years. (FVC
Labor Union-Philippine Transport and General
Workers Organization v. Sama-samang
Nagkakaisang Manggagawa sa FVC-Solidarity of
Independent and General Labor Organizations, G.R.
No. 176249, November 27, 2009)
---
Q: The Pinagbuklod union filed a Petition for
Certification Election, alleging that it was a
legitimate labor organization of the rank-and-
file employees of Delta Company. On Delta's
motion, the Med Arbiter dismissed the Petition,
based on the finding that Pinagbuklod was not a
legitimate labor union and had no legal
personality to file a Petition for Certification
Election because its membership was a mixture
of rank-and-file and supervisory employees.
Is the dismissal of the Petition for Certification
Election by the Med-Arbiter proper? (2013 Bar
Questions)
A: NO, because Delta Company did not have the
legal personality to participate in the certification
election proceedings and to file a motion to dismiss
based on the legitimacy status of the petitioning
union.
---
Requisites for the validity of the petition for
certification election
1. The union should be legitimate which means
that it is duly registered and listed in the
registry of legitimate labor unions of the BLR or
that its legal personality has not been revoked
or cancelled with finality
2. In case of organized establishments, the
petition for certification election is filed during
(and not before or after) the 60-day freedom
period of a duly registered CBA
3. In case of organized establishments, the
petition complied with the 25% written
support of the members of the bargaining unit
4. The petition is filed not in violation of any of the
four (4) bar rules
Rules prohibiting the filing of petition for
certification election (Bar rules)
A. General rule
8
The general rule is that in the absence of a CBA duly
registered in accordance with Article 231 of the
Labor Code, a petition for certification election may
be filed at any time.
B. Bar rules
No certification election may be held nder the
following rules:
1. Certification year bar rule;
2. Negotiations bar rule;
3. Bargaining deadlock bar rule; or
4. Contract bar rule
Certification year bar rule
Under this rule, a petition for certification election
may not be filed within one (1) year:
a. from the date the fact of voluntary recognition
has been entered; or
b. from the date a valid certification, consent, run-
off or re-run election has been conducted
within the bargaining unit.
Negotiation bar rule
Under this rule, no petition for certification election
should be3 entertained while the sole and exclusive
bargaining agent and the employer have
commenced and sustained negotiations in good
faith withint the period of one (1) year from the date
of a valid certification, consent, run-off, re-run or
from the date of voluntary recognition.
Once the CBA negotiation have commenced and
while the parties are in the process of negoiating the
terms and conditions of the CA, no challening union
is allowed to file a petition for certification election
that would disturb the process and unduly forestall
the early conclusion of the agreement.
Bargaining deadlock bar rule
Under this rule, a petition for certification election
may not be entertained when a bargaining deadlock
to which an incumbent or certified bargaining agent
is a party has been submitted to conciliation or has
become the subject of a valid notice of strike or
lockout.
Contract bar rule
Under this rule, a petition for certification election
may not be filed when a CBA between the employer
and a duly recognized or certified baargaining agent
has been registered with the Bureau of Labor
Relations (BLR) in accordance with the Labor Code.
 ADDENDUM
Where the CBA duly registered, a petition for
certification election may be filed within the 60-day
freedom period prior to its expiry. The purpose of
this rule is ensure stability in the relationship of the
workers and the employer by preventing frequent
modifications of any CBA entered into by them in
good faith and for the stipulated original period.
The contract bar rule does not apply in the
following cases:
1. Where there is an automatic renewal provision
in the CBA but prior to the date when such
automatic renewal became effective, the
employer seasonably filed a manifestation with
the Bureau of Labor Relations of its intention to
terminate the said agreement if and when it is
established that the bargaining agent does not
represent anymore the majority of the workers
in the bargaining unit.
2. Where the CBA, despite its due registration, is
found in appropriate proceedings that (a) it
contains provisions lower than the standards
fixed by law; or (b) the documents supporting
its registration are falsified, fraudulent or
tainted with misrepresentation.
3. Where the CBA does not foster industrial
stability, such as contracts wher ethe identity of
the representative is in doubt since the mployer
extended direct recognition to the union and
conducted a CBA therewith less than one (1)
year from the time a certification election was
conducted where the “no union” vote won. This
situation obtains in a case where the company
enteed into a CBA with the union when its
status as exclusive bargaining agent of the
employees has not been established yet.
4. Where the CBA was registed before or during
the last sixty (60) days of a subsisting
agreement or during the pendency of a
representation case. It is well-settled that the
60-day freedom period based on the origina
CBA should not be affected by any amendment,
extension or renewal of the CBA for purposes of
certification election.
GROUNDS FOR DENIAL OF PCE
In the following instances, PCE is barred:
1. Non-appearance – Non appearance of the
petitioner for two consecutive scheduled
conferences before the Mediator-Arbiter
despite notice. (No appreance rule)
2. Unregistered Union – The petitioning union or
national union/federation is not listed in the
Department’s registry of legitimate labor
9
unions or that its registration certificate has
been cancelled with finality. (Not listed in the
registry union rule)
NOTE: A filing of a petition to cancel DOES NOT
SUSPEND the PCE. To serve as a ground for
dismissal, the legal personality of the
petitioner should have been revoked or
cancelled with finality.
3. No Charter – Failure of a local/chapter or
national union/federation to submit duly
issued charter certificate upon filling of the
petition for certification eletction. (Non-
submission of charter certificate rule)
4. Absence of Employment Relationship –
Absence of employer-employee relationship
between all members of the petitioning union
and the establishment where the propsed
bargaining unit is sought to be represented. (No
employment relationship rule)
5. The 12 month Bar – Filing of a petition within
one (1) year from the date of the recording of
the voluntary recognition, or within the same
period from a valid certification, consent or
run-off election where no appeal on the results
of the certification, consent or run-off election
is pending. (One year bar rule)
6. Negotiation or Deadlock – a duly certified union
has commenced and sustained negotiations
with the employer in accordance with Article
250 of the LC within the 12 month bar, or there
exists a bargaining deadlock which had been
submitted to conciliation or arbitration or had
become the subject of a valid notice of strike or
lockout to which an incumbent or certified
bargaining agent is a party.
(Negotiation/Deadlock bar rule)
7. Existing CBA
8. Lack of Support – In an organized
establishment, the failure to submit the twenty
five percent (25%) signature requirement to
support the filling of the petition for the
certification election. (Failure to submit 25%
consent requirement rule)
Ee may intervene in the petition for certification
election
An Ee may intervene in the petition for certification
election for the purpose of protecting his individual
right. (IRR as amended by D.O. 40-F-03, s. 2008, Book
V, Rule VIII, Sec. 1)
Where petition for certification election is filed
The petition for certification election shall be filed
with the Regional Office. (IRR, as amended by D.O.
40-F-03, s. 2008)
 LABOR LAW AND SOCIAL LEGISLATION
Authority to hear and resolve the petition for in a CE. The purpose of a CE is to select an exclusive
certification election bargaining agent and a no union vote would
precisely mean that the voter is not choosing any of
The authority to hear and resolve the petition for the contending unions. If the no-union votes
certification election rests with the Mediator- constitute a majority of the valid votes cast, this fact
Arbiter. will all the more mean that no union won in CE. A
one-year bar will consequently stop the holding of
When petition for certification election is filed another CE to allow the Er to enjoy industrial peace
for at least one year.
The proper time to file the PCE depends on whether
the certified bargaining unit has a CBA or not: A Petition for Certification Election can be filed at
any time outside of the 60-day freedom period if
1. If it has no CBA, the petition may be filed there is a mass withdrawal or split from the majority
anytime outside the 12-month bar (certification union. (Poquiz, 2012)
year). ---
2. If it has CBA, it can be filed only within the last ---
60 days of the 5th year of the CBA.
Q: In what instance may a petition for
NOTE: At the expiration of the freedom period, the certification election be filed outside the
Er shall continue to recognize the majority status of freedom period of a current collective
the incumbent bargaining agent where no PCE is bargaining agreement? (1997 Bar Question)
filed.
A: As a general rule in an establishment where there
Union Election vs. Certification Election is a CBA in force and effect, a PCE may be filed only
during the freedom period of such CBA. But to have
CERTIFICATION that effect, the CBA should have been filed and
UNION ELECTION
ELECTION registered with the DOLE. (LC, Art. 231, 253-A and
Held pursuant to the The process is ordered 256)
union’s constitution and supervised by
and by-laws DOLE Thus, a CBA that has not been filed and registered
All Ees whether union with the DOLE cannot be a bar to a CE and such
or non-union members election can be held outside the freedom period of
Right to vote is such CBA.
who belong to the
enjoyed only by union
appropriate
members Alternative Answer: A PCE may be filed outside the
bargaining unit can
vote freedom period of a current CBA if such CBA is a new
The winner in a CE is CBA that has been prematurely entered into,
an entity, a union, meaning, it was entered into before the expiry date
Winners of union of the old CBA. The filing of the PCE shall be within
which becomes the
election become the freedom period of the old CBA which is outside
representative of the
officers and the freedom period of the new CBA that had been
whole bargaining unit
representatives of the prematurely entered into.
that includes even the
union only ---
members of the
defeated unions. ---
Q: Are probationary employees entitled to vote
NOTE: Both in CE and union election, the prescribed in a certification election? Why? (1999 Bar
procedures should be followed. Question)

--- A: YES. In a CE, all rank-and-file Ees in the

Q: Can a "No-union" win in a certification
election? (2006 Bar Question)
A: YES. The objective in a CE is to ascertain the
majority representation of the bargaining
representative, if the Ees desire to be represented at
all by anyone. Hence, no union is one of the choices
in a CE.
appropriate bargaining unit are entitled to vote.
This principle is clearly stated in Art. 255, LC which
states that the "labor organization designated or
selected by the majority of the Ees in such unit shall
be the exclusive representative of the Ees in such
unit for the purpose of CB". (Airtime Specialists ,Inc.
v. Ferrer-Calleja, G.R. No. 80612-16, December 29,
1989)

Alternative Answer: NO. A “no union” cannot win

10
 ADDENDUM
Any Ee, whether employed for a definite period or
not, shall beginning on the first day of his service, be
eligible for membership in any labor organization.
In a CE for the bargaining unit of rank and file Ees,
all rank and file Ees, whether probationary or
permanent are entitled to vote. As long as
probationary Ees belong to the defined bargaining
unit, they are eligible to support the PCE.
(NUWHRAIN-Manila Pavilion Hotel Chapter v.
Secretary, G.R. No. 181531, July 31, 2009)
---
Direct certification
It is the process whereby the Mediator-Arbiter
directly certifies a labor organization of an
appropriate bargaining unit of a company after a
showing that such petition is supported by at least a
majority of the Ees in the bargaining unit.
Direct certification is no longer allowed
By virtue of Executive Order No. 111, which became
effective on March 4, 1987, the direct certification
previously allowed under the Labor Code had been
discontinued as a method of selecting the exclusive
bargaining agents of the workers. Even in a case
where a union has filed a PCE, the mere fact that
there was no opposition does not warrant a direct
certification. More so in a case when the required
proof is not presented in an appropriate proceeding
and the basis of the direct certification is the union’s
self-serving assertion that it enjoys the support of
the majority of the Ees, without subjecting such
assertion to the test of competing claims.
(Samahang Manggagawa sa Permex v. Secretary,
G.R. No. 107792, March 2, 1998)
Failure of an independent union to prove its
affiliation with a federation does not affect its
right to file a petition for certification election as
an independent union
As a LLO, it has the right to file a PCE on its own
beyond question. Its failure to prove its affiliation
with a federation cannot affect its right to file said
PCE as an independent union. At the most, its failure
will result in an ineffective affiliation with the
federation. Despite affiliation, the local union
remains the basic unit free to serve the common
interest of all its members and pursue its own
interests independently of the federation. (Samahan
ng mga Manggagawa sa Filsystems v. SLE, G.R. No.
128067, June 5, 1998)
Illegally dismissed employees of the company
may participate in the certification election
11
It is now well-settled that Ees who have been
improperly laid off but who have at present an
unabandoned right to or expectation of re-
employment, are eligible to vote in CEs. Thus, and
to repeat, if the dismissal is under question, as in the
case now at bar whereby a case of illegal dismissal
and/or ULP was filed, the Ees concerned could still
qualify to vote in the elections. (Phiippine Fruits &
Vegetables Industries v. Torres, G.R. No. 92391, July 3,
1992)
Employees whose services were terminated are
still entitled to vote during the certification
election
Provided that there is a pending illegal dismissal
case filed by them. While the case is still pending,
the Er-Ee relationship is not yet severed.
How protest should be made during
certification elections
Protest must be raised and contained in the minutes
of the proceedings otherwise it is deemed waived.
(National Association of Trade Free Unions v. Mainit
Lumber Development Co. Workers Union, G.R. No.
79526, December 21, 1990) Protests should be
formalized before the Med-Arbiter within 5 days
from the close of the proceedings otherwise it is
deemed abandoned. (Timbungco v. Castro, G.R. No.
76111, March 14, 1990)
IN AN UNORGANIZED ESTABLISHMENT
Unorganized Establishment
An unorganized establishment is a bargaining unit
with no recognized or certified bargaining agent. It
does not necessarily refer to an entire company.
NOTE: It may happen that the rank-and-file unit has
a bargaining agent while the supervisory unit still
does not have such agent; thus, the former is already
an “organized establishment” while the latter
remains, in the same company, an unorganized
establishment.
Requirement for certification election in
unorganized establishments
The certification election shall be automatically
conducted upon the filing of a PCE by a LLO.
IN AN ORGANIZED ESTABLISHMENT
Requisites for certification election in an
Organized Establishment
 LABOR LAW AND SOCIAL LEGISLATION
The Mediator-Arbiter is required to automatically Effect of Ee’s withdrawal of his signature in the
order the conduct of a CE by secret ballot in an petition for certification election
organized establishment as soon as the following
requisites are met: If the withdrawal was made before the filing of the
petition, then the withdrawal is presumed to be
1. A petition questioning the majority status of the voluntary unless there is convincing proof to the
incumbent bargaining agent is filed before the contrary. If the withdrawal was made after the filing
DOLE within the 60-day freedom period; of the petition, the withdrawals are deemed
2. Such petition is verified; involuntary. Thus, withdrawals made after the filing
3. The petition is supported by the written of the petition will not affect the PCE.
consent of at least 25% of all the Ees in the
bargaining unit. (LC, Art. 256; TUPAS-WFTU v. Requisites for a petition for certification
Laguesma, G.R. No. 102350, June 30, 1994) election between organized and unorganized
establishments
Filing of 25% consent signature in the petition
for certification election Art.256. Art.257.
BASIS
ORGANIZED UNORGANIZED
Ideally, the signature should be filed together with Bargaining
the petition. However, it may be filed after the Present None
agent
petition within a reasonable period of time. Has to be a
Petition No need to be
verified
Effect if the petition for certification election filed verified
petition
was not accompanied by the requisite 25% No PCE except
consent signatures within 60 Not applicable.
days before No freedom
Under the Implementing Rules, absence or failure to Freedom
the expiration period. Petition
submit the written consent of at least 25% of all the Period
of the CBA. can be filed
Ees in the bargaining unit to support the petition is (See Art. 253 anytime.
a ground for denying the said petition. The Supreme & 253-A)
Court said that the Mediator-Arbiter may still have Must be duly
the discretion to grant or deny the petition. Even if supported by
there is no 25% consent signature submitted 25% of all the
together with the petition, it is within the discretion members of No substantial
of the Med-Arbiter whether to grant or deny the the support rule.
petition. (Port Workers Union v. Bienvenido appropriate
Laguesma, G.R. Nos. 94929-30, March 18, 1992) If the bargaining It is the
petition, however, is accompanied by the 25% Substantial
unit. intention of law
consent signatures, then the holding of the CE support
is to bring in the
becomes mandatory. (California Manufacturing rule
Percentage union, to
Corp. v. Laguesma, G.R. No. 97020, June 8, 1992) base: all implement
members of policy behind
Consent signatures of at least 25% of the an Art. 211(a).
employees in the bargaining unit may not be appropriate
submitted simultaneously with the filing of the bargaining
petition for certification election unit.

The administrative rule requiring the simultaneous
submission of the 25% consent signatures upon the
filing of PCE should not be strictly applied to
frustrate the determination of the legitimate
representative of the workers. Accordingly, the
Court held that the mere filing of a PCE within the
freedom period is sufficient basis for the issuance of
an order for the holding of a CE, subject to the
submission of the consent signatures within a
reasonable period from such filing. (Port Workers
Union of the Phils. v. Laguesma, G.R. Nos. 94929-30,
March 18, 1992)
NOTE: The approval of the PCE in an unorganized
bargaining unit is NEVER appealable, the reason
being that the law favors unionized than not
unionized.
RUN-OFF ELECTION
A run-off election refers to an election between the
labor union receiving the two highest votes in a
certification election or consent election with three
or more unions in contention, where such
certification election or consent election results in

12
 ADDENDUM
none of the contending unions receiving the It is an election voluntarily agreed upon by the
majority of the valid votes cast; provided, that the parties, with or without the intervention by the
total number of votes for all contending unions, if DOLE. [IRR, Book V, Rule I, Sec.1 (h)]
added, is at least fifty percent (50%) of the number NOTE: To afford an individual Ee-voter an informed
of valid votes cast (LC, Article 268, as renumbered). choice where a local/chapter is the petitioning
union, the local/chapter shall secure its certificate
When to be conducted: of creation at least five working days before the date
of the consent election. (IRR as amended by DO 40-F-
If conditions that justify the conduct of a run-off 03, Book V, Rule VIII, Sec. 1)
election are present and there are no objections or
challenges which, if sustained, can materially alter Certification election vs. consent election vs.
the election results, the Election Officer should motu run-off election vs. re-run election
proprio a run-off election within ten days from the
close of the election proceeding between the labor Participation
unions receiving the two highest number of votes Election of
Purpose
cast. Mediator-
Arbiter
Requirements for a run-off election Requires PCE
filed by a
1. An election was conducted with three or more union or Er. A
choices Med-Arbiter
2. None of the contending union obtained the grants the
required majority vote of 50% + 1 of the valid petition and
votes cast an election
3. There are no objections or challenges that can To determine
officer is
the sole and
alter the results materially designated by
4. The number of votes received by all contending exclusive
regional
bargaining
unions when added together amounts to at least director to
Certification agent of all the
50% of the total votes cast supervise the
Election Ees in an
election.
appropriate
NOTE: Thus if “no union” garnered the majority
bargaining
vote, no run-off elections may be held. NOTE: Med-
unit for the
Arbiter may
purpose of CB.
Choices in a run-off election determine if
there is an Er-
The unions receiving the highest and 2nd highest Ee
number of the votes cast (IRR, Book V, Rule X, Sec. 2). relationship
and if the
“No Union” is not a choice in the Run-off Election. voters are
eligible.
Posting of notice for run-off election To determine
the issue of
The notice should be posted by the Election Officer majority
at least five days before the actual date (IRR, Book V, representation
Rule X, Sec. 1). of all the
workers in the
RE-RUN ELECTION Held by
appropriate
agreement of
CB unit mainly
It is an election that takes place when: the unions
for the
1. One choice receives a plurality of the vote and Consent with or
purpose of
the remaining choices results in a tie; or Election without the
determining
2. All choices received the same number of votes. participation
the
of the Med-
administrator
In both instances, the “no union” is also a choice. Arbiter.
of the CBA
when the
CONSENT ELECTION contracting
union suffered
massive
disaffiliation

13
 LABOR LAW AND SOCIAL LEGISLATION
and not for the 2. A local chapter which was subsequently
purpose of granted independent registration but did not
determining disaffiliate from its federation.
the bargaining
agent for Purpose of affiliation
purpose of CB.
Takes place The purpose of affiliation is to foster the free and
between the voluntary organization of a string and united labor
unions who movement [LC, Art. 211 (c)].
received the
two highest How local chapter is created
numbers of
votes in a CE A duly registered federation or national union may
with three or directly create a local/chapter by issuing a charter
more choices, certificate indicating the establishment of a
Run-Off local/chapter.
where not one
Election
of the unions
obtained the 1. The chapter shall acquire legal personality only
majority of the for purposes of filing a PCE from the date it was
valid votes issued a charter certificate
cast, provided 2. The chapter shall be entitled to all other rights
the total union and privileges of a LLO only upon the
votes is at least submission of the following documents in
50% of the addition to its charter certificate:
votes cast. a. Names of the chapter’s officers, their
Takes place in addresses, and the principal office of the
two instances: chapter
1. If one choice b. Chapter’s constitution and by-laws
receives a c. Where the chapter’s constitution and by-
plurality of laws are the same as that of the federation
the vote and or the national union, this fact shall be
the indicated accordingly
remaining 3. The genuineness and due execution of the
choices supporting requirements shall be
results in a a. Certified under oath by the secretary or
Re-run treasurer of the local/chapter, and
tie; or
Election b. Attested to by its president. [IRR as
2. If all choices
received the amended by D.O. 40-F-03, Book V, Rule III,
same Sec. 2(e)]
number of
votes. Reportorial requirements in affiliation

In both The report of affiliation of independently registered

instances, the
no union is also
a choice.
NOTE: Petition for cancellation of registration is not
a bar to a PCE. No prejudicial question shall be
entertained in a PCE (D.O. 40-03).
AFFILIATION AND DISAFFILIATION OF THE
LOCAL UNION FROM THE MOTHER UNION
“Affiliate” refers to:
1. An independent union affiliated with a
federation, national union; or
labor unions with a federation or national union
shall be accompanied by the following documents:
1. Resolution of the labor union's board of
directors approving the affiliation;
2. Minutes of the general membership meeting
approving the affiliation;
3. The total number of members comprising the
labor union and the names of members who
approved the affiliation;
4. The certificate of affiliation issued by the
federation in favor of the independently
registered labor union; and
5. Written notice to the Er concerned if the
affiliating union is the incumbent bargaining
agent. (D.O. 40-03, Rule, III, Sec. 7 (2003))

14
 ADDENDUM
Effect of affiliation
The labor union that affiliates with a federation is
subject to the laws of the parent body under whose
authority the local union functions. The
Constitution, by-laws and rules of the mother
federation, together with the charter it issues to the
local union, constitutes an enforceable contract
between them and between the members of the
subordinate union inter se. Thus, pursuant to the
Constitution and by-laws, the federation has the
right to investigate and expel members of the local
union. (Villar v. Inciong, G.R. No. L-50283-84, April
20, 1983)
certification election among the rank and file
employees of the Skylander Company but its
rival union PSEA-WATU protested the results.
Pending the resolution of such controversy,
PSEA disaffiliated with PAFLU and hence
affiliated with NCW which was supported by its
members. May a local union disaffiliate with its
mother federation pending the settlement of the
status as the sole and exclusive bargaining
agent?
A: YES. The pendency of an election protest does not
bar the valid disaffiliation of the local union which
was supported by the majority of its members.

Disaffiliation of local union from the federation The right of a local union to disaffiliate with the
federation in the absence of any stipulation in the
GR: A labor union may disaffiliate from the mother Constitution and by-laws of the federation
union to form an independent union only during the prohibiting disaffiliation is well settled. Local
60-day freedom period immediately preceding the unions remain as the basic unit of association, free
expiration of the CBA. to serve their own interest subject to the restraints
imposed by the Constitution and by-laws of national
XPN: Even before the onset of the freedom period, federation and are free to renounce such affiliation
disaffiliation may still be carried out, but such upon the terms and conditions laid down in the
disaffiliation must be effected by the majority of the agreement which brought such affiliation to
union members in the bargaining unit. existence. In the case at bar, no prohibition existed
under the Constitution and by-laws of the
This happens when there is a substantial shift in federation. Hence, the union may freely disaffiliate
allegiance on the part of the majority of the with the federation. (Philippine Skylanders v. NLRC,
members of the union. In such a case, however, the G.R. No. 127374, January 31, 2002)
CBA continues to bind the members of the new or
disaffiliated and independent union to determine Independently Registered vs. Unregistered
the union which shall administer the CBA may be Chartered Local Union
conducted. (ANGLO-KMU v. Samahan ng
Manggagawang Nagkakaisa sa Manila Bay Spinning CHARTERED LOCAL UNION
Mills at J.P. Coats, G.R. No.118562, July 5, 1996. Basis Independentl Unregistere
y Registered d
Limitation to disaffiliation By
application
Disaffiliation should be in accordance with the rules with the
and procedures stated in the Constitution and by- federation for
laws of the federation. A local union may disaffiliate By signing the issuance
with its mother federation provided that there is no How to
contract of of a charter
enforceable provision in the federation’s affiliate?
affiliation certificate to
constitution preventing disaffiliation of a local be submitted
union. (Tropical Hut Employees Union v. Tropical to the Bureau
Hut, G.R. Nos. L-43495-99, January 20, 1990) Labor
Relations
A prohibition to disaffiliate in the Federation’s Would not Would cease
constitution and by-laws is valid because it is affect its being to be an LLO
intended for its own protection. an LLO and and would no
therefore it longer have
Locals or chapters who retained status as LLO shall Effect of
would continue the legal
be allowed to register as independent unions. If they Disaffiliatio
to have legal personality
fail to register, they shall lose their legitimate status n to the
personality and and the rights
upon the expiration of the CBA. union (local)
to possess all and privileges
rights and granted by
Q: PSEA is a local union in Skylander Company privileges of law to LLO,
which is affiliated with PAFLU. PSEA won the LLO. unless the

15
 LABOR LAW AND SOCIAL LEGISLATION
local chapter 4. Fines
is covered by 5. Contribution for labor education and research,
its duly mutual death and hospitalization benefits,
registered welfare fun, strike fund and credit and
CBA. cooperative undertakings [LC, Art. 277 (a)]
An existing 6. Agency fees [LC, Art. 248 (e)]
CBA would
The CBA Assessments
continue to be
would
Effect of valid as the
continue to Payments used for a special purpose. Especially if
Disaffiliatio labor
be valid up to required only for a limited time.
n to the CBA organization
its expiration
can continue
date. Union dues
administering
the CBA.
Union dues These are regular monthly contributions paid by the
Labor may no members to the union in exchange for the benefits
organization longer be given to them by the CBA and to finance the
entitled to the collected as activities of the union in representing the union.
Entitlement
union dues and there would
to union Check-off
not the no longer be
dues after
federation any labor
Disaffiliatio It is a method of deducting from an Ee’s pay at a
from which the union that is
n prescribed period, the amounts due the union for
labor allowed to
organization collect such fees, fines and assessments.
disaffiliated. union dues
from the Ees. Deductions for union service fees are authorized by
law and do not require individual check-off
SUBSTITUTIONARY DOCTRINE authorizations.

Under this doctrine, where there occurs a shift in the
Ees union allegiance after the execution of a CB
contract with the Er, the Ees can change their agent
(labor union) but the CB contract which is still
subsisting continues to bind the Ees up to its
expiration date. They may however, bargain for the
shortening of said expiration date.
NOTE: The Ee cannot revoke the validly executed
CB contract with their Er by the simple expedient of
changing their bargaining agent. The new agent
must respect the contract. (Benguet Consolidated
Inc. v. BCI Employees and Worker’s Union-PAFLU, G.R.
No. L-24711, April 30, 1968)
However, it cannot be invoked to support the
contention that a newly certified CB agent
automatically assumes all the personal
undertakings of the former agent-like the “no strike
clause” in the CBA executed by the latter.
UNION DUES AND SPECIAL ASSESSMENTS
Dues and assessments which the union may
collect
Legitimate labor organizations are authorized to
collect reasonable amount of the following:
1. Membership fees
2. Union dues
3. Assessments
Nature and purpose of check-off
Union dues are the lifeblood of the union. All unions
are authorized to collect reasonable membership
fees, union dues, assessments, fines and other
contributions for labor education and research,
mutual death and hospitalization benefits, welfare
fund, strike fund and credit and cooperative
undertakings. [LC, Art. 277(a)]
Special assessments or extraordinary fees
These are assessments for any purpose or object
other than those expressly provided by the labor
organization’s Constitution and by-laws.
REQUIREMENTS FOR VALIDITY
Requisites of a valid check-off
GR: No special assessments, attorney’s fees,
negotiation fees or any other extraordinary fees
may be checked off from any amount due to an Ee
without individual written authorization duly
signed by the Ee.
The authorization should specify the:
1. Amount
2. Purpose &
3. Beneficiary of the deduction.

16
 ADDENDUM
XPNs:
1. For mandatory activities under the LC
2. For Agency Fees
3. When non-members of the union avail of the
benefits of the CBA:
a. Non-members may be assessed union dues
equivalent to that paid by union members;
b. Only by board resolution approved by
majority of the members in general
meeting called for the purpose.
Requisites for a valid levy of special assessment
or extraordinary fees
1. Authorization by a written resolution of the
majority of all members at the general
membership meeting duly called for that
purpose;
2. Secretary’s record of the minutes of the
meeting, which must include the:
a. List of members present
b. Votes cast
c. Purpose of the special assessments
d. Recipient of such assessments;
3. Individual written authorization to check-off
duly signed by the Ee concerned – to levy such
assessments. [LC, Art. 241 (n)]
Effect of failure to strictly comply with the
requirements set by law
It shall invalidate the questioned special
assessments. Substantial compliance with the
requirements is not enough in view of the fact that
the special assessment will diminish the
compensation of union members. (Palacol v. Ferrer-
Calleja,G.R. No. 85333, February 26, 1990)
Jurisdiction over check-off disputes
Being an intra-union dispute, the RD of the DOLE
has jurisdiction over check off disputes.

Check-off vs. special assessments

BASIS Check-off
Special Assessment
(Union Dues)
By obtaining the individual written
authorization duly signed by the Ee which
By written resolution approved by majority of
must specify
all the members at the meeting called for that
How 1. Amount
purpose.
approved 2. Purpose
3. Beneficiary
(Agency fees)
Not necessary when
1. For mandatory activities under the
LC
Exception to 2. For Agency Fees
such 3. When non-members of the union
requirement avail of the benefits of the CBA No exception; written resolution is mandatory
a. Said non-members may be assessed in all instances.
union dues equivalent to that paid
by union members;
b. Only by Board resolution approved
by majority of the members in
general meeting called for the
purpose

AGENCY FEE Q: A is employed by XYZ Company where XYZ

Agency fee
It is an amount equivalent to union dues, which a
non-union member pays to the union because he
benefits from the CBA negotiated by the union.
NOTE: Payment by non-union members of agency
fees does not amount to unjust enrichment because
the purpose of such dues is to avoid discrimination
between union and non-union members.
Employees Union (XYZ-EU) is the recognized
exclusive bargaining agent. Although A is a
member of rival union XYR-MU, he receives the
benefits under the CBA that XYZ-EU had
negotiated with the company. XYZ-EU assessed
A, a fee equivalent to the dues and other fees
paid by its members but A insists that he has no
obligation to pay said dues and fees because he
is not a member of XYZ–EU and he has not issued
an authorization to allow the collection. Explain

17
 LABOR LAW AND SOCIAL LEGISLATION
whether his claim is meritorious. (2010 Bar Union Dues Agency Fee
Question) Is deducted from non-
Is deducted from members of the
A: NO. The fee exacted from A takes the form of an members for the bargaining agent
agency fee which is sanctioned by Art. 248 (e), LC. payment of union (union) for the
The collection of agency fees in an amount dues enjoyment of the
equivalent to union dues and fees from Ees who are benefits under the CBA.
not union members is recognized under the LC. The May not be deducted
union may collect such fees even without any from the salaries of May be deducted from
written authorization from the non-union member the union members the salary of the Ees
Ees, if said Ees accept the benefits resulting from the without the written without their written
CBA. The legal basis of agency fees is quasi- consent of the consent.
contractual (Del Pilar Academy v. Del Pilar Academy workers affected.
Employees Union, G.R. No. 170112, April 30, 2008).
RIGHT TO COLLECTIVE BARGAINING
CHECK-OFF: UNION DUES vs. AGENCY FEES
Collective bargaining
Union dues vs. agency fees
1. It is the process of negotiation by an
BASIS UNION DUES AGENCY FEES organization or group of workmen, in behalf of
Collected from Collected by its members, with the Er, concerning wages,
union the union hours of work, and other terms and conditions
members from non- of employment, and
members 2. The settlement of disputes by negotiation
belonging to between an Er and the representative of his Ees.
From whom
the same
collected
bargaining GR: No court or administrative agency or official
unit who shall have the power to set or fix wages, rates of pay,
receive the hours of work, or other terms and conditions of
benefits under employment
the CBA
There must be Can be XPNs: As otherwise provided under the LC:
an individual assessed even
written without the 1. National Wages and Productivity Commission
Need for
authorization written and RTWPB as to wage fixing (LC, Art. 99 and
Written
by individual authorization 122).
Authorization
members. of the 2. NCMB and NLRC as to wage distortion (LC, Art.
employee 124).
concerned. 3. SLE and President of the Philippines as to
certification and assumption of powers over
REQUISITES FOR ASSESSMENT labor disputes [LC, Art. 236(g)].

Requisites for assessment of agency fees Purpose behind this rule

1. The Ee is part of the bargaining unit
2. He is not a member of the union It is to encourage a truly democratic method of
3. He partook of the benefits of the CBA regulating the relations between the Ers and Ees by
means of agreements freely entered into through
NOTE: Other than for mandatory activities under CB.
the Code, no special assessments, attorney’s fees,
negotiation fees or any other extraordinary fees Parties to a collective bargaining
may be checked off from any amount due to an Ee
without his authorization. The individual 1. Employer
authorization required under this article shall not 2. Ees, represented by the exclusive bargaining
apply to non-members of the recognized CB agent agent
with regard to assessment of agency fees.
Jurisdictional preconditions in Collective
Union Dues vs. Agency Fees Bargaining (Kiok Loy Doctrine)

18
 ADDENDUM
The mechanics of CB, which is defined as
negotiations towards a collective agreement, is set
in motion only when the following jurisdictional
preconditions are present, namely
1. Possession of the status of majority
representation of Ees representative in
accordance with any of the means of selection
or designation provided for by the LC;
2. Proof of majority representation;
3. A demand to bargain under Art. 250 (a), LC.
(Kiok Loy v. NLRC, G.R. No. L-54334, January 22,
1986)
Commencement of collective bargaining
Bargaining commences within 12 months after the
determination and certification of the Ees exclusive
bargaining representative. (certification year)
Procedure in collective bargaining
When a party desires to negotiate an agreement:
1. It shall serve a written notice upon the other
party with a statement of proposals
2. Reply by the other party shall be made within
10 days with counter proposals
3. In case of differences, either party may request
for a conference which must be held within 10
calendar days from receipt of request
4. If not settled, NCMB may intervene and
encourage the parties to submit the dispute to a
VA
5. If not resolved, the parties may resort to any
other lawful means (either to settle the dispute
or submit it to a VA).
NOTE: During the conciliation proceeding in the
NCMB, the parties are prohibited from doing any act
which may disrupt or impede the early settlement
of disputes. [LC, Art. 250 (d)]
Stages in Collective Bargaining
1. Preliminary process: Sending a written notice
for negotiation which must be clear and
unequivocal
2. Negotiation process.
3. Execution process. The signing of the
agreement
4. Publication for at least 5 days before ratification
5. Ratification by the majority of all the workers in
the bargaining unit represented in the
negotiation (not necessary in case of arbitral
award)
6. Registration process.
19
7. Administration process. The CBA shall be
jointly administered by the management and
the bargaining agent for a period of 5 years.
8. Interpretation and Application process.
NOTE: Members of Cooperatives cannot invoke the
right to collective bargaining because each member
is considered an owner. (2012 Bar) (Benguet
Electric Cooperative vs. Pura Ferrer-Calleja, G.R. No.
79025, Dec. 29, 1989)
DUTY TO BARGAIN COLLECTIVELY
Duty to bargain collectively
The duty to bargain collectively means the
performance of a mutual obligation to meet and
convene promptly and expeditiously in good faith
for the purpose of negotiating an agreement with
respect to wages, hours of work and all other terms
and conditions of employment including proposals
for adjusting any grievances or questions arising
under such agreement and executing a contract
incorporating such agreements if requested by
either party but such duty does not compel any
party to agree to a proposal or to make any
concession (LC, Art. 263, as renumbered).
When there is a CBA, the duty to bargain collectively
shall also mean that neither party shall terminate
nor modify such agreement during its lifetime.
However, either party can serve a written notice to
terminate or modify the agreement at least 60 days
prior to its expiration date. It shall be the duty of
both parties to keep the status quo and to continue
in full force and effect the terms and conditions of
the existing agreement during the 60-day period
and/or until a new agreement is reached by the
parties (LC, Art. 253).
Commencement of duty of the Er to bargain
collectively
Only after the union requests the Er to bargain. If
there is no demand, the Er cannot be in default.
NOTE: Where a majority representative has been
designated, it is a ULP for the Er, as a refusal to
collectively bargain, to deal and negotiate with the
minority representative to the exclusion of the
majority representative.
Where there is a legitimate representation issue,
there is no duty to bargain collectively on the part of
the Er (Lakas ng mga Manggagawang Makabayan v.
Marcelo Enterprises, G.R. No. L-38258, November 19,
1982).
Restrictions to the duty to bargain collectively
 LABOR LAW AND SOCIAL LEGISLATION
1. Such duty does not compel any party to agree to
a proposal or to make any concession.
2. Parties cannot stipulate terms and conditions of
employment which are below the minimum
requirements prescribed by law.
---
Q: Does a petition for cancellation of a union’s
certificate of registration involve a prejudicial
question that should first be settled before
parties could be required to collectively
bargain?
A: NO. A pending cancellation proceeding is not a
bar to set mechanics for CB. If a certification
election may still be held even if a petition for
cancellation of a union’s registration is pending,
more so that the CB process may proceed. The
majority status of the union is not affected by the
cancellation proceedings (Capitol Medical Center v.
Trajano, G.R. No. 155690, June 30, 2005).
Impasse in bargaining
1. Where the subject of a dispute is a mandatory
bargaining subject, either party may bargain to
an impasse as long as he bargains in good faith.
2. Where the subject is non-mandatory, a party
may not insist in bargaining to the point of
impasse. His instance may be construed as
evasion of duty to bargain.
Test of bargaining in good faith
There is no perfect test of good faith in bargaining.
The good faith or bad faith is an inference to be
drawn from the facts and is largely a matter for the
NLRC’s expertise. The charge of bad faith should be
raised while the bargaining is in progress.
NOTE: With the execution of the CBA, bad faith can
no longer be imputed upon any of the parties
thereto. All provisions in the CBA are supposed to
have been jointly and voluntarily incorporated
therein by the parties. This is not a case where
private respondent exhibited an indifferent attitude
towards CB because the negotiations were not the
unilateral activity of petitioner union. The CBA is
good enough that private respondent exerted
“reasonable effort of good faith bargaining”
(Samahang Manggagawa sa Top Form
Manufacturing-United Workers of the Phiippinels v.
NLRC, G.R. No. 113856, September 7, 1998).
---
Q: Does an employer’s steadfast insistence to
exclude a particular substantive provision in the
negotiations for a CBA constitute refusal to
bargain or bargaining in bad faith?
20
A: NO. This is no different from a bargaining
representative’s perseverance to include one that
they deem of absolute necessity. Indeed, an
adamant insistence on a bargaining position to the
point where the negotiations reach an impasse does
not establish bad faith. Obviously, the purpose of CB
is the reaching of an agreement resulting in a
contract binding on the parties; but the failure to
reach an agreement after negotiations have
continued for a reasonable period does not
establish a lack of good faith. The statutes invite and
contemplate a CB contract, but they do not compel
one. The duty to bargain does not include the
obligation to reach an agreement. While the law
makes it an obligation for the Er and the Ees to
bargain collectively with each other, such
compulsion does not include the commitment to
precipitately accept or agree to the proposals of the
other. All it contemplates is that both parties should
approach the negotiation with an open mind and
make reasonable effort to reach a common ground
of agreement (Union of Filipro Employees v. Nestle
Philippines, G.R. Nos. 158930-31, March 3, 2008).
---
Deadlock
Deadlock is synonymous with impasse or a
standstill which presupposes reasonable effort at
good faith bargaining but despite noble intentions
does not conclude an agreement between the
parties.
Occurrence of deadlock in collective bargaining
A deadlock arises when there is an impasse which
presupposes reasonable effort at good faith in
bargaining which, despite noble intentions, does not
conclude in agreement between the parties.
Remedies in case of deadlock in the
renegotiation of the collective bargaining
agreement
The parties may:
1. Call upon the NCMB to intervene for the
purpose of conducting conciliation or
preventive mediation;
2. Refer the matter for VA or compulsory
arbitration;
3. Declare a strike or lockout upon compliance
with the legal requirements (This remedy is a
remedy of last resort)
Economic exigencies
Economic exigencies cannot justify refusal to
bargain. An Er is not guilty of refusal to bargain by
 ADDENDUM
persistently rejecting the union’s economic
demands where he is operating at a loss, on a low
profit margin, or in a depressed industry, as long as
he continues to negotiate. But financial hardship
constitutes no excuse for refusing to bargain
collectively.
WHEN THERE IS NO CBA
Duty to bargain collectively when there is no
collective bargaining agreement
In the absence of an agreement or other voluntary
arrangement providing for a more expeditious
manner of CB, it shall be the duty of Er and the
representatives of the Ees to bargain collectively in
accordance with the provisions of the LC (LC, Art.
251).
WHEN THERE IS A CBA
Duty to bargain collectively when there is a
collective bargaining agreement
When there is a CBA, the duty to bargain
collectively, in addition to Art. 252, shall mean that
1. Neither party shall terminate nor modify such
agreement during its lifetime.
2. However, either party can serve a written
notice to terminate or modify the agreement at
least 60 days prior the expiration of its 5th year.
3. It shall be the duty of both parties to keep the
status quo and to continue in full force and effect
the terms and conditions of the existing
agreement during the 60-day period and/or
until a new agreement is reached by the parties.
CBA is a contract of indefinite period under Art. 253.
“Freedom period” – pertains to the last 60 days of
the 5-year lifetime of a CBA prior to its expiration.
The automatic renewal clause is deemed
incorporated in all CBAs because it is mandated by
law. Pending the renewal of the CBA, the parties are
bound to keep the status quo and to treat the terms
and conditions embodied therein in full force and
effect during the 60-day freedom period and/or
until a new agreement is negotiated and ultimately
concluded and reached by the parties.
As such, the Er cannot discontinue the grant of the
benefits embodied in the CBA which just expired as
it is duty-bound to maintain the status quo by
continuing to give the same benefits until a renewal
thereof is reached by the parties. On the other hand,
the union has to observe and continue to abide by
itds undertakings and commitments under the
expired CBA until the same is renewed.
21
A CBA is entered into in order to foster stability and
mutual cooperation between labor and capital. An
Er should not be allowed to rescind unilaterally its
CBA with the duly certified bargaining agent it had
previously contracted with, and decide to bargain
anew with a different group if there is no legitimate
reason for doing so and without first following the
proper procedure. If such behavior would be
tolerated, bargaining and negotiations between the
Er and the union will never be truthful and
meaningful, and no CBA forged after arduous
negotiations will ever be honored or be relied upon
(Employees Union of Bayer Phils., FFW v. Bayer
Philippines, Inc., G.R. No. 162943, December 6, 2010).
Single Enterprise Bargaining
It involves negotiation between one certified labor
union and one Er. Any voluntarily recognized or
certified labor union may demand negotiations with
its Er for terms and conditions of work covering Ees
in the bargaining unit concerned (IRR as amended by
Department Order No. 40-03, s. 2003, Book V, Rule
XVI, Sec. 3).
Multi-employer Bargaining Scheme
It involves negotiation between and among several
certified labor unions and Ers.
Any legitimate labor union and Er may agree in
writing to come together for the purpose of CB
provided that:
1. Only legitimate labor unions which are
incumbent exclusive bargaining agents may
participate and negotiate;
2. Only Ers with counterpart legitimate labor
unions which are incumbent bargaining agents
may participate and negotiate; and
3. Only those legitimate labor unions which
pertain to employer units which consent to
multi-Er bargaining may participate (IRR as
amended by Department Order No. 40-03, s.
2003, Book V, Rule XVI, Sec. 5).
COLLECTIVE BARGAINING AGREEMENT
Collective Bargaining Agreement (Law of the
Plant)
It is a contract executed upon request of either the
Er or the exclusive bargaining representative of the
Ees incorporating the agreement reached after
negotiations with respect to wages, hours of work,
terms and conditions of employment, including
proposals for adjusting any grievance or questions
under the agreement.
 LABOR LAW AND SOCIAL LEGISLATION
NOTE: The certification of the CBA by the BLR is not
required to make such contract valid. Once it is duly
entered into and signed by the parties, a CBA
becomes effective as between the parties whether
or not it has been certified by the BLR (Liberty Flour
Mills Employees Association v. Liberty Flour Mills, G.R.
Nos. 58768-70, December 29, 1989).
Nature of a collective bargaining agreement
The CBA is the law between the contracting
parties—the CB representative and the Er-
company. Compliance with a CBA is mandated by
the expressed policy to give protection to labor.
(Vicente Almario v. Philippine Airlines, Inc., G.R. No.
170928, September 11, 2007)
Purpose of a collective bargaining agreement
The goal of CB is the making of agreements that will
stabilize business conditions and fix fair standards
of working conditions. (P.I. Manufacturing,
Incorporated v. P.I. Manufacturing Supervisors and
Foremen Association, G.R. No. 167217, February 4,
2008)
Filing for registration of collective bargaining
agreement
Within 30 days from execution of CBA, the parties
thereto shall submit the agreement to the Regional
Office which issued the certificate of registration/
certificate of creation of chartered local of the labor
union-party to the agreement.
Requirements for registration
The application for CBA registration shall be
accompanied by the original and two duplicate
copies of the following requirements:
1. CBA
2. A statement that the CBA was posted in at least
two conspicuous places in the establishment
concerned for at least five days before its
ratification
3. Statement that the CBA was ratified by the
majority of the Ees in the bargaining unit.
The following documents must be certified under
oath by the representative of the Er and the labor
union. No other document shall be required in the
registration of the CBA.
In one case, the CBA was not posted for at least five
days in two conspicuous places in the establishment
before ratification, to enable the workers to clearly
inform themselves of its provisions. Moreover, the
CBA submitted to the MOLE (now SOLE) did not
carry the sworn statement of the union secretary,
22
attested by the union president, that the CBA had
been duly posted and ratified, as required by
Section 1, Rule 9, Book V of the Implementing Rules
and Regulations. These requirements being
mandatory, non-compliance therewith rendered
the said CBA ineffective (Associated Trade Unions v.
Trajano, G.R. No. L-75321, June 20, 1988).
Ratification of the CBA
G.R. The agreement negotiated by the employees'
EBR should be ratified or approved by the majority
of all the workers in the bargaining unit. The proper
ratifying group is not the majority union but the
majority of all the workers in the bargaining unit
represented by the negotiation. A CBA is valid
between the parties, but unless it will be ratified, it
shall not be enforceable.
XPN. Ratification of the CBA by the employees is not
needed when the CBA is a product of an arbitral
award by a proper government authority [LC, Art.
263 (g)] or a voluntary arbitrator (LC, Art. 262).
Zipper clause
It is a stipulation in a CBA indicating that issues that
could have been negotiated upon but not contained
in the CBA cannot be raised for negotiation when
the CBA is already in effect.
A CBA is not an ordinary contract but one impressed
with public interest, only provisions embodied in
the CBA should be so interpreted and complied
with. Where a proposal raised by a contracting
party does not find print in the CBA, it is not a part
thereof and the proponent has no claim whatsoever
to its implementation (SMTFM-UWP v. NLRC, G.R.
No. 113856, September 7, 1998) under the zipper
clause.
60-day freedom period
During the 60-day freedom period:
1. A labor union may disaffiliate from the mother
union to form a local or independent union only
during the 60-day freedom period immediately
preceding the expiration of the CBA.
2. Either party can serve a written notice to
terminate or modify agreement at least 60 days
prior to its expiration period.
3. A PCE may be filed.
Notice Period under Art. 253
The freedom period under Article 253-A & 256 is
different from the other 60-day period mentioned in
Article 253. The latter speaks of the right of the
parties to propose modifications to the existing CBA,
 ADDENDUM
as an exception to the rule that the CBA cannot be a. Interpretation/implementation of the CBA
modified during its lifetime. This 60-day period and
does not and cannot refer to the representative b. Interpretation/ enforcement of company
status of the incumbent union since the acquisition personnel policies.
or loss of representative status is to be resolved
through CE. Grievance machinery

MANDATORY PROVISIONS OF THE CBA It refers to the mechanism for the adjustment and
resolution of grievances arising from the
Mandatory provisions of the collective interpretation or enforcement of company
bargaining agreement personnel policies. It is part of the continuing
process of CB.
1. Grievance machinery
2. Voluntary Arbitration NOTE: It is a mandatory provision in any CBA. No
3. Wages collective agreement can be registered in the
4. Hours of work absence of such procedure.
5. Family planning
6. Rates of pay Establishment of grievance machinery
7. Mutual observance clause
8. No Strike-No Lockout Clause Grievance machinery should be established:
9. Labor-Management Council 1. Agreement by the parties
10. Drug-free provision 2. A grievance committee – composed of at least
two representatives each from the members of
NOTE: In addition, the BLR requires that the CBA the bargaining unit and the Er, unless otherwise
should include a clear statement of the term of the agreed upon by the parties – shall be created
CBA. Er’s duty to bargain is limited to mandatory within 10 days from the signing of CBA
bargaining subjects; as to other matters, he is free to
bargain or not. NOTE: Although Art. 260, LC mentions “parties to a
CBA”, it does not mean that grievance machinery
GRIEVANCE PROCEDURE cannot be set up in a CBA-less enterprise. In any
workplace where grievance can arise, grievance
Grievance machinery can be established.

There is grievance when a dispute or controversy Grievance procedure

arises over the interpretation or implementation of
any provision of the CBA or interpretation or
enforcement of company personnel policies [IRR,
Book V, Rule I, Sec.1 (u)].
In order to be grievable, the violation of the CBA
should be ordinary and not gross in character;
otherwise, they shall be considered as ULP.
It refers to the internal rules of procedure
established by the parties in their CBA which
usually consists of successive steps starting at the
level of the complainant and his immediate
supervisor and ending, when necessary, at the level
of the top union and company officials and with VA
as the terminal step.

Gross violation of the CBA is defined as flagrant ---

and/or malicious refusal by a party thereto to
comply with the economic provisions thereof. If
what is violated is a non-economic or a political
provision of the CBA, the same shall not be
considered as ULP and may thus be processed as a
grievable issue in accordance with and following the
grievance machinery laid down in the CBA.
Provisions that must be included in a collective
bargaining agreement
Q: What will happen to grievances submitted to
the grievance machinery which are not settled
within seven calendar days from the date of
their submission?
A: They shall automatically be referred to VA
prescribed in the CBA [LC, Art. 260 (2)].
NOTE: The automatic transmittal to the VA is in the
nature of an appeal.
---

1. Provisions that will ensure the mutual Either party may serve notice upon the other of its
observance of its terms and conditions. decision to submit the issue to VA. If the party upon
2. A machinery for adjustment and resolution of whom such notice is served fails/refuses to respond
grievances arising from the: within seven days from receipt, VA/panel

23
 LABOR LAW AND SOCIAL LEGISLATION
designated in the CBA shall commence arbitration
proceedings. If the CBA does not designate or if the
parties failed to name the VA/panel, the regional
branch of NCMB appoints VA/panel.
---
Q: How are cases arising from the
Interpretation or implementation of collective
bargaining agreements handled and disposed?
(1995 Bar Question)
A: They are disposed through the grievance
machinery and if not resolved by the grievance
machinery, through VA.
---
VOLUNTARY ARBITRATION
Voluntary arbitration
It refers to the mode of settling labor management
disputes by which the parties select a competent,
trained and impartial third person who shall decide
on the merits of the case and whose decision is final
and executory [NCMB Revised Procedural Guidelines
in the Conduct of Voluntary Arbitration Proceedings,
(2004), Rule II, Sec. 1(d)].
Basis for voluntary arbitration
It is the policy of the State to promote and
emphasize the primacy of free collective bargaining
and negotiations, including voluntary arbitration,
mediation and conciliation, as modes of settling
labor or industrial disputes [LC, Art. 211(a)].
The State shall promote the principle of shared
responsibility between workers and employers and
the preferential use of voluntary modes in settling
disputes, including conciliation, and shall enforce
their mutual compliance therewith to foster
industrial peace (1987 Constitution, Art. XIII, Sec. 3).
The primacy of voluntary arbitration is mandated
by the Philippine Constitution itself and entrenched
in the Labor Code as a matter of basic industrial
relations policy. These legal mandates, in turn, are
formalized recognition of the fundamental tenet
that the best persons to resolve a labor dispute are
the party disputants themselves. (Azucena, 2010)
Voluntary arbitrator
Any person who has been accredited by the NCMB
as such, or any person named or designated in the
CBA by the parties as their voluntary arbitrator, or
one chosen by the parties with or without the
assistance of the NCMB, pursuant to a selection
procedure agreed upon in the CBA or one appointed
24
by the NCMB in case either of the parties to the CBA
refuses to submit to VA.
A voluntary arbitrator is not an Ee, functionary or
part of the government or of the DOLE, but he is
authorized to render arbitration services provided
under labor laws (Ludo & Luym Corporation v.
Saornido, G.R. No. 140960, January 20, 2003).
Compulsory arbitration vs. Voluntary
arbitration
Compulsory arbitration is a system whereby the
parties to a dispute are compelled by the
government to forego their right to strike and are
compelled to accept the resolution of their dispute
through arbitration by a 3rd party. The essence of
arbitration remains since a dispute is resolved by a
disinterested 3rdparty whose decision is final and
binding on the parties. The 3rdparty is normally
appointed by the government.
Under VA, referral of a dispute by the parties is
made, pursuant to a VA clause in their CBA, to an
impartial 3rdperson for a final and binding
resolution. Ideally, arbitration awards are to be
complied with by both parties without delay, such
that once an award has been rendered by an
arbitrator, nothing is left to be done by both parties
but to comply with the same (Luzon Development
Bank v. Association of Luzon Development Bank
Employees, G.R. No. 120319, October 6, 1995).
Enforcement of decision of a voluntary
arbitrator
Upon motion of any interested party, the voluntary
arbitrator or panel of voluntary arbitrators or the
LA in the region where the movant resides, in case
of the absence or incapacity of the voluntary
arbitrator or panel of voluntary arbitrators, for any
reason, may issue a writ of execution requiring
either the sheriff of the NLRC or regular courts or
any public official whom the parties may designate
in the submission agreement to execute the final
decision, order or award.
NO STRIKE-NO LOCKOUT CLAUSE
It is a clause in the CBA which is an expression of the
firm commitment of the parties that, on the part of
the union, it will not mount a strike during the
effectivity of the CBA, and on the part of the Er, that
it will not stage a lockout during the lifetime thereof.
A strike conducted in violation of this clause is
illegal.
 ADDENDUM
Application of no strike-no Lockout clause in the
collective bargaining agreement
The “no strike-no lockout” clause in the CBA applies
only to economic strikes. It does not apply to ULP
strikes. Hence, if the strike is founded on a ULP of
the Er, a strike declared by the union cannot be
considered a violation of the no strike clause
(Master Iron Labor Union v. NLRC, G.R. No. 92009,
February 17, 1993).
Effects of acts of violence committed in the
course of strike
1. If pervasive, widespread and regularly
committed, it is illegal, union is responsible.
2. If isolated, sporadic or remote, it is still legal but
the person who committed is responsible.
LABOR MANAGEMENT COUNCIL
Formation of Labor Management Council
Labor-Management Councils or Committees may be
formed voluntarily by workers and Ers in the event
no legitimate labor organization exists for the
purpose of promoting industrial peace.
NOTE: One thing it cannot and must not do is to
replace a union. It can deal with the Er on matters
affecting the employee's rights, benefits and welfare
(Azucena, 2010).
Role of the DOLE in the creation of Labor
Management Councils
The DOLE shall promote the formation of labor-
management councils in organized and unorganized
establishments to enable the workers to participate
in policy and decision-making processes in the
establishment, insofar as said processes will
directly affect their rights, benefits and welfare,
except those which are covered by CB agreements
or are traditional areas of bargaining.
The DOLE shall promote other labor-management
cooperation schemes and, upon its own initiative or
upon the request of both parties, may assist in the
formulation and development of programs and
projects on productivity, occupational safety and
health, improvement of quality of work life, product
quality improvement, and other similar schemes
(IRR, Book V, Rule XXI, Sec. 1).
Selection of representative in the Management
Council
In organized establishments, the workers’
representative to the council shall be nominated by
25
the exclusive bargaining representative. In
establishments where no LLO exists, the workers’
representative shall be elected directly by the Ees at
large (IRR, Book V, Rule XXI, Sec. 2).
Grievance Machinery vs. Labor Management
Council
GRIEVANCE LABOR MANAGEMENT
MACHINERY COUNCIL
Resolves disputes in the Resolves disputes not
interpretation and within the provisions of
implementation of the the CBA (PHIMCO
meaning of the Industries v. PHIMCO
provisions of the CBA Industries Labor
and of the company Association, G.R. No.
personnel policies. 170830, August 11,
2010).
DURATION OF A COLLECTIVE BARGAINING
AGREEMENT
1. 5 years – Representation aspect (refers to the
identity and majority status of the union that
negotiated the CBA as the exclusive bargaining
representative)
2. 3 years after the execution of the CBA – All
other provisions which refers to the rest of the
CBA, economic as well as non-economic
provisions except representation (LC, Art. 253-
A).
NOTE: Neither party shall terminate nor modify the
CBA during its lifetime. However, either party can
serve a written notice to terminate or modify the
agreement at least 60 days prior to its expiration
date. It shall be the duty of both parties to keep the
status quo and to continue in full force and effect the
terms and conditions of the existing agreement
during the 60-day period and/or until a new
agreement is reached by the parties (LC, Art. 253,).
No petition questioning the majority status of the
incumbent bargaining agent shall be entertained by
the DOLE and no CE shall be conducted outside of
the 60-day freedom period.
---
Q: What is the automatic renewal clause of
collective bargaining agreements? (2008 Bar
Question)
A: The automatic renewal clause means that
although the CBA has expired, it continues to have
legal effects as between the parties until a new CBA
has been entered into (Pier & Arrastre Stevedoring
Services, Inc. v. Confessor, G.R. No. 110854, February
13, 1995). The rationale of the such clause to make
it the duty of the parties to keep the status quo and
 LABOR LAW AND SOCIAL LEGISLATION
to continue in full effect the terms and conditions of
the existing agreement until a new agreement is
reached by the parties (Principle of CBA Continuity;
LC, Art. 253).
---
Hold-over Principle
It shall be the duty of both parties to keep the status
quo and to continue in full force and effect the terms
and conditions of the existing agreement during the
60-day period and/or until a new agreement is
reached by the parties. Despite the lapse of the
formal effectivity of the CBA the law still considers
the same as continuing in force and effect until a
new CBA shall have been validly executed.
---
Q: Does the hold-over principle apply to an
imposed CBA / arbitral award?
A: YES. The hold-over principle, i.e., the duty of the
parties to keep the status quo and to continue in full
force and effect the terms and conditions of the
existing CBA until a new agreement is reached by
the parties apply to an imposed CBA. The law does
not provide for any exception nor qualification on
which economic provisions of the existing
agreement are to retain its force and effect.
Likewise, the law does not distinguish between a
CBA duly agreed upon by the parties and an
imposed CBA (General Milling Corporation – ILU v.
General Milling Corp., G.R. No. 193723, July 20, 2011).
---
FOR ECONOMIC PROVISIONS
Economic provisions of a collective bargaining
agreement
Economic provisions are provisions granting
economic benefits to the Ees such as increases,
vacation and sick leaves, hospitalization and
retirement.
FOR NON-ECONOMIC PROVISIONS
Non-economic provisions of a collective
bargaining agreement
1. Coverage of the bargaining unit
2. Union security clauses
3. Management prerogatives and/or
rights/responsibilities of Ees
4. Grievance machinery and VA
5. No strike – no lock out provision
26
Effectivity and retroactivity date of economic
and non-economic provisions of the collective
bargaining agreement
1. If the CBA is the very first for the bargaining
unit, the parties have to decide the CBA
effectivity date.
2. Those made within six months after date of
expiry of the CBA are subject to automatic
retroaction to the day immediately following
the date of expiry.
3. Those not made within six months, the parties
may agree to the date of retroaction.
NOTE: This rule applies only if there is an existing
agreement. If there is no existing agreement, there
is no retroactive effect because the date agreed
upon shall be the start of the period of agreement.
Retroactivity does not apply if the provisions were
imposed by the SLE by virtue of arbitration. It
applies only if the agreement was voluntarily made
by the parties.
---
Q: May the economic provisions of an existing
CBA be extended beyond the 3 year period as
prescribed by law in the absence of a new
agreement?
A: YES. Under the principle of hold over, until a new
CBA has been executed by and between the parties,
they are duty bound to keep the status quo and must
continue in full force and effect the terms and
conditions of the existing agreement. The law does
not provide for any exception or qualification as to
which of the economic provisions of the existing
agreement are to retain force and effect. Therefore,
it must be encompassing all the terms and condition
in the said agreement (New Pacific Timber v. NLRC,
G.R. No. 124224, March 17, 2000).
---
---
Q: Mindanao Terminal Company and
respondent union has an existing CBA which
was about to expire. Negotiations were held
regarding certain provisions of the CBA which
resulted in a deadlock. The union thereafter
filed a notice of strike. During the conference
called by the NCMB, the company and the union
were able to agree on all of the provisions of the
CBA except for one. The unresolved provision
was subsequently settled, however no CBA was
signed. Thus, in the records of the Mediation
Arbiter, all issues were settled before the lapse
of the six month period after the expiration of
the old CBA. Does the signing of the CBA by the
parties determine the date it was entered into?
 ADDENDUM
A: NO. The signing of the CBA does not determine
the date it was entered into. In the present case,
there was already a meeting of the minds between
the company and the union prior to the end of the
six month period after the expiration of the old CBA.
Hence, such meeting of the minds is sufficient to
conclude that an agreement has been reached
within the six month period as provided under Art.
253-A, LC (Mindanao Terminal and Brokerage
Services Inc., v. Confessor, G.R. No. 111809, May 5,
1997).
---
---
Q: When is the effectivity of an arbitral award
concluded beyond six months from the
expiration of the old CBA?
A: The CBA arbitral award granted six months from
the expiration of the last CBA shall retroact to such
time agreed upon by both the Er and the union.
Absent such agreement as to retroactivity, the
award shall retroact to the 1st day after the six
month period following the expiration of the last
day of the CBA should there be one. In the absence
of a CBA, the SLE’s determination of the date of
retroactivity as part of his discretionary powers
over arbitral award shall control (Manila Electric
Company v. Quisumbing, G.R. No. 127598, Feb. 22,
2000).
---
---
Q: PAL was suffering from a worsened financial
condition resulting to a retrenchment which
downsized its labor force by more than 1/3
thereby affecting numerous union members.
Hence, the union went on strike. The PAL offered
that shares of stock be transferred to its Ees but
the union refused. Thus, PAL claimed it has no
alternative left but to close. PALEA then
proposed that the CBA be suspended for 10
years provided they remain the certified
bargaining agent. PAL agreed and resumed
operations. Is the agreement to suspend the CBA
for 10 years abdicated the worker’s right to
bargain?
A: NO. The primary purpose of a CBA is to stabilize
labor-management relations in order to create a
climate of a sound and stable industrial peace. The
assailed agreement was the result of the voluntary
CB negotiations undertaken in the light of severe
financial situation faced by PAL (Rivera v. Espiritu,
G.R. No. 135547, January 23, 2002).
---
---
Q: Is the agreement in conflict with Art. 253-A,
LC?
27
A: NO. There is no conflict between the agreement
and Art. 253-A, LC for the latter has a two-fold
purpose namely: a) to promote industrial stability
and predictability and b) to assign specific time
tables wherein negotiations become a matter of
right and requirement. In so far as the first purpose,
the agreement satisfies the first purpose. As regard
the second purpose, nothing in Art. 253-A prohibits
the parties from waiving or suspending the
mandatory timetables and agreeing on the remedies
to enforce the same (Rivera v. Espiritu, G.R. No.
135547, January 23, 2002).
---
---
Q: Does the agreement violate the five year
representation limit as provided under Art. 253-
A, LC?
A: NO. Under the said article, the representation
limit of the exclusive bargaining agent applies only
when there is an existing CBA in full force and effect.
In this case, the parties agreed to suspend the CBA
and put in abeyance the limit on representation
(Rivera v. Espiritu, G.R. No. 135547, January 23,
2002).
---
---
Q: What is the effect of an amended or extended
term of the collective bargaining agreement on
the exclusive representation status of the
collective bargaining agent and the right of
another union to ask for certification as
exclusive bargaining agent?
A: While the parties may agree to extend the CBA’s
original five-year term together with all other CBA
provisions, any such amendment or term in excess
of five years will not carry with it a change in the
union’s exclusive bargaining status. By express
provision of Art. 253-A of the LC, the exclusive
bargaining status cannot go beyond the five years
and the representation status is a legal matter not
for the workplace parties to agree upon. Despite an
agreement for a CBA with a life of more than five
years, either as an original provision or by
amendment, the bargaining union’s exclusive
bargaining status is effective only for five years and
can be challenged within 60 days prior to the
expiration of the CBA’s first five years (FVC Labor
Union-Philippine Transport and General Workers
Organization v. Sama-samang Nagkakaisang
Manggagawa sa FVC-Solidarity of Independent and
General Labor Organizations, G.R. 176249, November
27, 2009).
---
---
Q: ABC Company and U labor union have been
negotiating for a new collective bargaining
agreement but failed to agree on certain
 LABOR LAW AND SOCIAL LEGISLATION
economic provisions of the existing agreement. Closed shop vs. Union shop
In the meantime, the existing collective
bargaining agreement expired. The company CLOSED SHOP UNION SHOP
thereafter refused to pay the employees their Er cannot hire any Ee Er can hire even those
midyear bonus, saying that the collective unless they are who are not members
bargaining agreement which provided for the members of the union. of the union but it
grant of midyear bonus to all company requires that after a
employees had already expired. Are the certain period they
employees entitled to be paid their midyear must become
bonus? Explain your answer. (2010 Bar members of the union.
Question)
Maintenance of membership shop
A: YES. The parties are duty-bound to maintain the
status quo and to continue in full force and effect the There is maintenance of membership shop when
terms and conditions of the existing CBA until a new Ees, who are union members as of the effective date
agreement is reached by the parties (Art. 253, LC). of the agreement, or who thereafter become
Furthermore, Art. 253-A provides for an automatic members, must maintain union membership as a
renewal clause of a CBA. Although a CBA has condition for continued employment until they are
expired, it continues to have legal effects as between promoted or transferred out of the bargaining unit
the parties until a new CBA has been entered into. or the agreement is terminated.
---
Requisites for termination on account of
UNION SECURITY enforcement of a union security clause in a
collective bargaining agreement
Union security is a generic term, which is applied to
and comprehends “closed shop,” “union shop,” In terminating the employment of an Ee by
“maintenance of membership,” or any other form of enforcing the union security clause, the Er needs
agreement which imposes upon Ees the obligation only to determine and prove that:
to acquire or retain union membership as a 1. The union security clause is applicable;
condition affecting employment. 2. The union is requesting for the enforcement of
the union security provision in the CBA; and
UNION SECURITY CLAUSES; CLOSED SHOP, 3. There is sufficient evidence to support the
UNION SHOP, MAINTENANCE OF MEMBERSHIP decision of the union to expel the Ee from the
SHOP, ETC. union.

A stipulation in CBA whereby the management These requisites constitute just cause for
recognizes that the memberships of Ees in the union terminating an Ee based on the union security
which negotiated said agreement should be provision of the CBA (Gen. Milling Corporation v.
maintained and continued as a condition for Casio, G.R. No. 149552 March 10, 2010).
employment or retention of employment. The
obvious purpose is to safeguard and ensure the FORMS OF ULP IN COLLECTIVE BARGAINING
continued existence of the union.
1. Failure to meet and convene
Closed shop 2. Evading the mandatory subjects of bargaining
3. Bad faith in bargaining, including failure to
A closed shop may be defined as an enterprise in execute the CBA if requested
which, by agreement between the Er and his Ees or 4. Gross violation of the CBA
their representatives, no person may be employed 5. Surface Bargaining
in any or certain agreed departments of the 6. Blue sky bargaining
enterprise unless he or she is, becomes, and, for the
duration of the agreement, remains a member in NOTE: Violations of CBA, except those which are
good standing of a union entirely comprised of or of gross in character, shall no longer be treated as ULP
which the Ees in interest are a part. but a grievance under CBA (Silva v. NLRC, G.R. No.
110226, June 19, 1997).
Union shop
BARGAINING IN BAD FAITH
There is union shop when all new regular Ees are
required to join the union within a certain period as Boulwareism
a condition for their continued employment.

28
 ADDENDUM
Boulwareism is a violation of good faith in
bargaining. It includes the failure to execute the CBA
(Bad Faith Bargaining).
Occurrence of boulwareism
It occurs when Er directly bargains with the Ee
disregarding the union; the aim was to deal with the
labor union through Ees rather than with the Ees
thru the union. Er submits its proposals and adopts
a take-it-or-leave-it stand.
REFUSAL TO BARGAIN
Occurrence of refusal to bargain
This occurs when the Er refuses or fails to meet and
convene with the majority of his Ees. To bargain in
good faith, an Er must not only meet and confer with
the union which represents his Ees, but must also
recognize the union for the purpose of CB (Azucena,
2010).
Effect of refusal of management to give counter-
proposals to the union’s demands
The failure of the Er to submit its counter-proposals
to the demands of the bargaining union does not, by
itself, constitute refusal to bargain (Philippine
Marine Radio Officers Association v. CIR, 102 Phil
373). However, when the Er refuses to submit an
answer or reply to the written bargaining proposals
of the certified bargaining union, ULP is committed.
NOTE: While the law does not compel the parties to
reach an agreement, it contemplates that both
parties will approach the negotiation with an open
mind and make a reasonable effort to reach a
common ground of agreement (Kiok Loy v. NLRC,
G.R. No. 54334, January 22, 1986).
INDIVIDUAL BARGAINING CONSIDERED AS
UNFAIR LABOR PRACTICE
When the Er attempts to negotiate with individual
workers rather than with the certified bargaining
agent is considered as ULP (Insular Life Assurance
Co.,Ltd., Employees Assoc.-NATU v. Insular Life
Assurance Co., Ltd., G.R. No. L-25291, January 30,
1971).
NOTE: There is no legal prohibition for an Ee to
bargain with his Er.
BLUE SKY BARGAINING
It is defined as making exaggerated or unreasonable
proposals. Demands which the Er has no capacity to
give.
29
Whether or not the union is engaged in blue-sky
bargaining is determined by the evidence presented
by the union as to its economic demands. Thus, if the
union requires exaggerated or unreasonable
economic demands, then it is guilty of ULP
(Standard Chartered Bank v. Confessor, G.R. No.
114974, June 16, 2004).
SURFACE BARGAINING
It is the act of “going through the motions of
negotiating” without any legal intent to reach an
agreement (Standard Chartered Bank v. Confessor,
G.R. No. 114974, June 16, 2004).
A concrete example is the withholding of the Er of
the audited financial statement requested by the
union.
Surface bargaining is a question of intent of the
party concerned and usually such intent can only be
inferred from the totality of the challenged party’s
conduct both at and away from the bargaining table.
Featherbedding/make work activities
It refers to the practice of the union or its agents in
causing or attempting to cause an Er to pay or
deliver or agree to pay or deliver money or other
things of value, in the nature of an exaction, for
services which are not performed or not to be
performed, as when a union demands that the Er
maintain personnel in excess of the latter’s
requirements, including the demand for fee for
union negotiations [LC, Art. 249 (d)]. It is a form of
an extortion committed by the union against the Er.
NOTE: It is not featherbedding if the work is
performed no matter how unnecessary or useless it
may be.
Sweetheart Contract
It is when a labor organization asks for or accepts
negotiations or attorney’s fees from Ers as part of
the settlement of any issue in CB or any other
dispute.
The resulting CBA is considered as a “sweetheart
contract” – a CBA that does not substantially
improve the employees’ wages and benefits and
whose benefits are far below than those provided by
law. It is an incomplete or inadequate CBA.