Case Digests
Labor Law Review: Labor Relations
Samahan ng Mangagawa Sa Hanjin Shipyard
vs. Bureau of Labor Relations
The right to self-organization is not limited to
unionism. Workers may also form or join an
association for mutual aid and protection and
for other legitimate purposes.
FACTS: Samahan argues that the right to form
a workers' association is not exclusive to
intermittent, ambulant and itinerant workers.
While the Labor Code allows the workers "to
form, join or assist labor organizations of their
own choosing" for the purpose of collective
bargaining, it does not prohibit them from
forming a labor organization simply for
purposes of mutual aid and protection. All
members of Samahan have one common place
of work, Hanjin Shipyard. Thus, there is no
reason why they cannot use "Hanjin Shipyard"
in their name.
Hanjin counters that Samahan failed to adduce
sufficient basis that all its members were
employees of Hanjin or its legitimate
contractors, and that the use of the name "Hanjin
Shipyard" would create an impression that all its
members were employess of HHIC.
Samahan reiterates its stand that workers with a
definite employer can organize any association
for purposes of mutual aid and protection.
Inherent in the workers' right to self-
organization is its right to name its own
organization. Samahan referred "Hanjin
Shipyard" as their common place of work.
Therefore, they may adopt the same in their
association's name.
ISSUE:
1.) WON Samahan can form a workers
association for mutual aid and protection?
2.) WON Samahan can use the name “Hanjin”?
RULING: Petition is partly meritorious.
1.) Yes, Samahan can form workers
association for the purpose of mutual aid
and protection.
In the case at bench, the Court cannot sanction
the opinion of the CA that Samahan should have
formed a union for purposes of collective
bargaining instead of a workers' association
because the choice belonged to it. The right to
form or join a labor organization necessarily
includes the right to refuse or refrain from
exercising the said right. It is self-evident that
just as no one should be denied the exercise of a
right granted by law, so also, no one should be
compelled to exercise such a conferred right.
Also inherent in the right to self-organization is
the right to choose whether to form a union for
purposes of collective bargaining or a workers'
association for purposes of providing mutual aid
and protection.
The right to self-organization, however, is
subject to certain limitations as provided by law.
For instance, the Labor Code specifically
disallows managerial employees from joining,
assisting or forming any labor union.
Meanwhile, supervisory employees, while
eligible for membership in labor organizations,
are proscribed from joining the collective
bargaining unit of the rank and file employees.
Even government employees have the right to
self-organization. It is not, however, regarded as
existing or available for purposes of collective
bargaining, but simply for the furtherance and
protection of their interests.
Hanjin posits that the members of Samahan have
definite employers, hence, they should have
formed a union instead of a workers' association.
The Court disagrees. There is no provision in the
Labor Code that states that employees with
definite employers may form, join or assist
unions only.
The Court cannot subscribe either to Hanjin's
position that Samahan's members cannot form
the association because they are not covered by
the second sentence of Article 243 (now 249), to
wit:
Article 243. Coverage and employees' right to self-
organization. All persons employed in commercial,
industrial and agricultural enterprises and in religious,
charitable, medical, or educational institutions, whether
operating for profit or not, shall have the right to self-
organization and to form, join, or assist labor
organizations of their own choosing for purposes of
collective bargaining. Ambulant, intermittent and itinerant
workers, self-employed people, rural workers and those
without any definite employers may form labor
organizations for their mutual aid and protection. (As
amended by Batas Pambansa Bilang 70, May 1, 1980)
[Emphasis Supplied]
Further, Article 243 should be read together with
Rule 2 of Department Order (D.O.) No. 40-03,
Series of 2003, which provides:
RULE II
COVERAGE OF THE RIGHT TO SELF-ORGANIZATION
Section 1. Policy. - It is the policy of the State to promote
the free and responsible exercise of the right to self-
organization through the establishment of a simplified
mechanism for the speedy registration of labor unions and
workers associations, determination of representation
status and resolution of inter/intra-union and other related
labor relations disputes. Only legitimate or registered
labor unions shall have the right to represent their
members for collective bargaining and other purposes.
Workers' associations shall have the right to represent
their members for purposes other than collective
bargaining.
Section 2. Who may join labor unions and workers'
associations. - All persons employed in commercial,
industrial and agricultural enterprises, including
employees of government owned or controlled
corporations without original charters established under
the Corporation Code, as well as employees of religious,
charitable, medical or educational institutions whether
operating for profit or not, shall have the right to self-
organization and to form, join or assist labor unions for
purposes of collective bargaining: provided, however, that
supervisory employees shall not be eligible for membership
in a labor union of the rank-and-file employees but may
form, join or assist separate labor unions of their own.
Managerial employees shall not be eligible to form, join or
assist any labor unions for purposes of collective
bargaining. Alien employees with valid working permits
issued by the Department may exercise the right to self-
organization and join or assist labor unions for purposes
of collective bargaining if they are nationals of a country
which grants the same or similar rights to Filipino
workers, as certified by the Department of Foreign Affairs.
For purposes of this section, any employee, whether
employed for a definite period or not, shall beginning on
the first day of his/her service, be eligible for membership
in any labor organization.
All other workers, including ambulant, intermittent and
other workers, the self-employed, rural workers and those
without any definite employers may form labor
organizations for their mutual aid and protection and other
legitimate purposes except collective bargaining.
[Emphases Supplied]
Clearly, there is nothing in the foregoing
implementing rules which provides that workers,
with definite employers, cannot form or join a
workers' association for mutual aid and
protection. Section 2 thereof even broadens the
coverage of workers who can form or join a
workers' association. Thus, the Court agrees
with Samahan's argument that the right to form a
workers' association is not exclusive to
ambulant, intermittent and itinerant workers.
The option to form or join a union or a workers'
association lies with the workers themselves,
and whether they have definite employers or not.
2.) No, Samahan cannot use the name
“Hanjin”
Nevertheless, the Court agrees with the BLR
that "Hanjin Shipyard" must be removed in the
name of the association. A legitimate workers'
association refers to an association of workers
organized for mutual aid and protection of its
members or for any legitimate purpose other
than collective bargaining registered with the
DOLE. Having been granted a certificate of
registration, Samahan's association is now
recognized by law as a legitimate workers'
association.
According to Samahan, inherent in the workers'
right to self-organization is its right to name its
own organization. It seems to equate the
dropping of words "Hanjin Shipyard" from its
name as a restraint in its exercise of the right to
self-organization. Hanjin, on the other hand,
invokes that "Hanjin Shipyard" is a registered
trade name and, thus, it is within their right to
prohibit its use.
As there is no provision under our labor laws
which speak of the use of name by a workers'
association, the Court refers to the Corporation
Code, which governs the names of juridical
persons. Section 18 thereof provides:
No corporate name may be allowed by the Securities and
Exchange Commission if the proposed name is identical or
deceptively or confusingly similar to that of any existing
corporation or to any other name already protected by law
or is patently deceptive, confusing or contrary to existing
laws. When a change in the corporate name is approved,
the Commission shall issue an amended certificate of
incorporation under the amended name.
[Emphases Supplied]
The policy underlying the prohibition in Section
18 against the registration of a corporate name
which is "identical or deceptively or confusingly
similar" to that of any existing corporation or
which is "patently deceptive" or "patently
confusing" or "contrary to existing laws," is the
avoidance of fraud upon the public which would
have occasion to deal with the entity concerned,
the evasion of legal obligations and duties, and
the reduction of difficulties of administration
and supervision over corporations.
For the same reason, it would be misleading for
the members of Samahan to use "Hanjin
Shipyard" in its name as it could give the wrong
impression that all of its members are employed
by Hanjin.
Holy Child Catholic School vs. Sto. Tomas &
HCC-TELU-PIGLAS (2013)
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. The alleged
inclusion of supervisory employees in a labor
organization seeking to represent the
bargaining unit of rank-and-file employees does
not affect that organization’s right to file a
petition for certification organization. Mingling
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.
FACTS: May 31, 2002 – A petition for
certification election was filed by HCSS-TELU-
PIGLAS (PIGLAS), a duly registered labor
organization. 120 teachers and employees (out
of 156 total employees) comprised the proposed
bargaining unit.
HCCS, on the other hand – in its comment and
position paper – alleged that PIGLAS members
do not belong to the same class: PIGLAS is not
only a mixture of managerial, supervisory, and
rank-and-file employees (3 vice-principals, 1
department head/supervisor, and 11
coordinators) but also a combination of teaching
and non-teaching personnel (27 non-teaching
personnel).
It insisted that the PIGLAS was an illegitimate
labor organization lacking in personality to file a
petition for certification election for not being in
accord with Article 245 and an inappropriate
bargaining unit for want of community or
mutuality of interest.
PIGLAS countered the HCCS failed to
substantiate its claim that some of the employees
included in the petition holds managerial and
supervisory positions.
And even assuming that it is true, “mixture of
employees” is not one of the enumerated
instances in which a petition shall be dismissed
(DO No.9).
Questions pertaining to qualifications of
employees may be threshed out in the inclusion-
exclusion proceedings.
PIGLAS contended that the will of the
employees should be respected – they had
manifested their desire to be represented by only
one bargaining unit.
It asserted that academic and on-academic
personnel have similar working conditions.
The Med-Arbiter denied the petition for
certification election on the ground that the unit
which the PIGLAS sought to represent is
inappropriate.
The Med-Arbiter held that PIGLAS failed the
“community or mutuality of interest” test:
whether or not it is fundamentally the
combination which will best assure to all
employees the exercise of their collective
bargaining rights.
There were 2 classes: teaching staff and non-
teaching staff.
The Union appealed to the SOLE.
The SOLE ruled against the dismissal and
directed the conduct of two separate certification
elections for the teaching and the non-teaching
personnel.
It held that although there are differences in the
nature of work, hours and conditions of work
and salary determination, these differences are
not substantial enough to warrant the dismissal
of the petition., as pointed out by PIGLAS.
PIGLAS could exist as a legitimate labor org. –
but it shall represent both classes of employees
in separate bargaining negotiations and
agreements.
HCSS filed before the CA a petition for
certiorari with a Prayer for TRO and Preliminary
Injunction.
The CA eventually dismissed the petition.
The CA held that the Vice Principals,
Department Head, and Coordinators are neither
supervisory nor managerial employees – they
wield no policy-making authority (they are
limited to recommending policies).
Thus, there is no improper commingling of
members as to preclude the petition for
certification of election.
The CA also ruled that the SOLE did not
commit GAD in not dismissing the petition for
certification election since it directed the
conduct of two separate certification elections
for teaching and non-teaching units.
The CA denied the MR hence, this petition.
ISSUE:
(1) Is a petition for certification election is
dismissible on the ground that the labor
organization’s membership allegedly consists of
supervisory and rank-and-file employees. (NO.)
(2) Did the CA err in holding that the SOLE did
not commit GAD in not dismissing the petition
for certification election? (NO.)
RULING:
(1) Current rule: the alleged inclusion of
supervisory employees in a labor organization
does not affect that organization’s right to file a
petition for certification.
Note: “bystander rule” – a certification election
is the sole concern of the workers.
Even when the employer has to file the petition
(Art. 259), as after filing its role in the
certification process ceases.
This is done in order to avoid the impression
that the employer is battling for a company
union.
Current Rule
But on June 21, 1997, the 1989 Amended
Omnibus Rules was further amended by DO No.
9. The requirement under Sec. 2(c) - that the
petition for certification election indicate that the
bargaining unit of rank-and-file employees has
not been mingled with supervisory employees -
was removed.
In Tagaytay Highlands Int'l. Golf Club, Inc. v.
Tagaytay Highlands Employees Union-
PTGWO, it was held that 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.
Thus, the doctrine enunciated in Toyota and
Dunlop was abandoned.
In subsequent cases, the SC reiterated that the
alleged inclusion of supervisory employees in a
labor organization seeking to represent the
bargaining unit of rank-and-file employees does
not divest it of its status as a legitimate labor
organization.
DO No. 9 is applicable in this case as the
petition for certification election was filed on
May 31, 2002. It must also be stressed that
HCCS cannot collaterally attack the legitimacy
of private respondent by praying for the
dismissal of the petition for certification election
(recall the Bystander Rule).
Moreover, the determination of whether union
membership comprises managerial and/or
supervisory employees is a factual issue that is
best left for resolution in the inclusion-exclusion
proceedings, which has not yet happened in this
case so still premature to pass upon.
(2) No error on the part of the CA in holding
that the SOLE did not commit GAD in not
dismissing the petition for certification election
on the ground that PIGLAS was not qualified to
file such a petition in the first place, for failing
to qualify as a legitimate labor org.
SC: the concepts of a union and a legitimate
labor organization are different from, but relate
to, the concept of a bargaining unit.
A labor organization as "any union or
association of employees which exists in whole
or in part for the purpose of collective
bargaining or of dealing with employers
concerning terms and conditions of
employment.” [Art. 212(g), LC]
Having been validly issued a certificate of
registration (by the Regional Office or Bureau),
PIGLAS should be considered as having
acquired juridical personality – which may not
be attacked collaterally.
The correct procedure for an employer would be
to file a petition for cancellation of the union’s
certificate of registration – due to
misrepresentation, false statement, or fraud,
under the circumstances enumerated in Art. 239
of the LC, as amended.
A bargaining unit has been defined as a "group
of employees of a given employer, comprised of
all or less than all of the entire body of
employees, which the collective interests of all
the employees, consistent with equity to the
employer, indicated to be best suited to serve
reciprocal rights and duties of the parties under
the collective bargaining provisions of the law.
A bargaining unit is a group of employees
sought to be represented by a petitioning union.
Such employees need not be members of a union
seeking the conduct of a certification election.
A union certified as an exclusive bargaining
agent represents not only its members but also
other employees who are not union members.
What the UP v. Ferrer-Calleja case prohibits is
the commingling of teaching and non-teaching
personnel in one bargaining unit – they have to
be separated into 2 bargaining units, with two
separate certification elections.
The SOLE’s decision was not incompatible with
this doctrine.
SC: “Indeed, the purpose of a certification
election is precisely to ascertain the majority of
the employees’ choice of an appropriate
bargaining unit – to be or not to be represented
by a labor organization and, if in the affirmative
case, by which one.”
Petition DENIED. Decision of the CA
AFFIRMED.
PAFLU vs. Secretary of Labor (1969)
The registration prescribed in paragraph (b) of
said section is not a limitation to the right of
assembly or association, which may be
exercised with or without said registration. The
latter is merely a condition sine qua non for the
acquisition of legal personality by labor
organizations, associations or unions and the
possession of the "rights and privileges granted
by law to legitimate labor organizations.
FACTS: The Registration of Labor
Organizations issued a notice of hearing on the
matter of cancellation of the registration of the
Social Security System Employees Association
(SSSEA) – which was affiliated with PAFLU –
for failure to furnish the BLR with the reports of
finances and list of officers after the election.
The Registrar, upon the submission of the
required memorandums, ordered a decision to
cancel the registration of SSSEA. PAFLU then
filed this petition for certiorari and prohibition
saying that RA 875 violates the freedom of
assembly and association, and that Section 23 of
the law providing for the cancellation of union
registration upon failure to submit the necessary
reportorial requirements was deemed repealed
when the Philippines ratified the ILO
Convention No. 87.
ISSUE: WON the effect of Section 23(b) of
Republic Act No. 8751 unduly curtails the
1
RA 875, Sec. 23 (b) - Any labor organization, association
or union of workers duly organized for the material,
intellectual and moral well being of its members shall
acquire legal personality and be entitled to all the rights and
privileges granted by law to legitimate labor organizations
within thirty days of filing with the office of the Secretary
of Labor notice of its due organization and existence and
the following documents, together with the amount of five
pesos as registration fee, except as provided in paragraph
“d” of this section:
(1) A copy of the constitution and by-laws of the
organization together with a list of all officers of the
association, their addresses and the address of the principal
office of the organization;
(2) A sworn statement of all officers of the said
organization, association or union to the effect that they are
not members of the Communist Party and that they are not
members of any organizations which teaches the overthrow
of the Government by force or by any illegal or
unconstitutional method; and
(3) If the applicant organization has been in existence for
one or more years, a copy of its last annual financial report.
(d) The registration and permit of a legitimate labor
organization shall be cancelled by the Department of
Labor, if the Department has reason to believe that the
labor organization no longer meets one or more of the
requirements of paragraph (b) above; or fails to file with
the Department of Labor either its financial report within
sixty days of the end of its fiscal year or the names of its
new officers along with their non-subversive affidavits as
outlined in paragraph (b) above within sixty days of their
election; however, the Department of Labor shall not order
the cancellation of the registration and permit without due
freedom of assembly and association guaranteed
in the Bill of Rights?
RULING: No.
The registration prescribed in paragraph (b) of
said section is not a limitation to the right of
assembly or association, which may be
exercised with or without said registration. The
latter is merely a condition sine qua non for the
acquisition of legal personality by labor
organizations, associations or unions and the
possession of the "rights and privileges granted
by law to legitimate labor organizations".
The Constitution does not guarantee these rights
and privileges, much less said personality, which
are mere statutory creations, for the possession
and exercise of which registration is required to
protect both labor and the public against abuses,
fraud, or impostors who pose as organizers,
although not truly accredited agents of the union
they purport to represent. Such requirement is a
valid exercise of the police power, because the
activities in which labor organizations,
associations and union of workers are engaged
affect public interest, which should be protected.
Furthermore, the obligation to submit financial
statements, as a condition for the non-
cancellation of a certificate of registration, is a
reasonable regulation for the benefit of the
members of the organization, considering that
the same generally solicits funds or membership,
as well as oftentimes collects, on behalf of its
members, huge amounts of money due to them
or to the organization.
Electromat Manufacturing vs. Hon.
Lagunzad (2011)
Undoubtedly, the intent of the law in imposing
lesser requirements in the case of a branch or
local of a registered federation or national
notice and hearing, as provided under paragraph (c) above,
and the affected labor organization shall have the same
right of appeal to the courts as previously provided.
union is to encourage the affiliation of a local
union with a federation or national union in
order to increase the local unions bargaining
powers respecting terms and conditions of
labor. D.O. 40- 03 represents an expression of
the governments implementing policy on trade
unionism. It builds upon the old rules by further
simplifying the requirements for the
establishment of locals or chapters.
FACTS: The private respondent Nagkakaisang
Samahan ng Manggagawa ng Electromat‐Wasto
(union), a charter affiliate of the Workers
Advocates for Struggle, Transformation and
Organization (WASTO), applied for registration
with the Bureau of Labor Relations (BLR). The
BLR thereafter issued the union a Certification
of Creation of Local Chapter (equivalent to the
certificate of registration of an independent
union), pursuant to Department Order No.
(D.O.) 40‐03.[4]
On October 1, 2003, the petitioner Electromat
Manufacturing and Recording Corporation
(company) filed a petition for cancellation of the
union's registration certificate, for the union's
failure to comply with Article 234 of the Labor
Code. It argued that D.O. 40‐03 is an
unconstitutional diminution of the Labor Code's
union registration requirements under Article
234. Specifically, it assails as unconstitutional
Section 2(E), Rule III of D.O. 40‐03 which
provides:
The report of creation of a chartered local shall
be accompanied by a charter certificate issued
by the federation or national union indicating the
creation or establishment of the chartered local.
DECISION OF LOWER COURTS: * DOLE:
dismissed the petition. * BLR Director: affirmed
the decision of the DOLE. * CA: affirmed BLR
Director.
ISSUE: WON the Department order is
constitutional or whether D.O. 40‐03 is a valid
exercise of the rule‐making power of the DOLE?
APPLICABLE LAWS: Article 2342
RULING: YES, constitutional.
Undoubtedly, the intent of the law in imposing
lesser requirements in the case of a branch or
local of a registered federation or national union
is to encourage the affiliation of a local union
with a federation or national union in order to
increase the local unions bargaining powers
respecting terms and conditions of labor. D.O.
40-03 represents an expression of the
governments implementing policy on trade
unionism. It builds upon the old rules by further
simplifying the requirements for the
establishment of locals or chapters. As in D.O.
9, we see nothing contrary to the law or the
Constitution in the adoption by the Secretary of
Labor and Employment of D.O. 40‐03 as this
department order is consistent with the intent of
the government to encourage the affiliation of a
local union with a federation or national union to
enhance the local's bargaining power. If changes
were made at all, these were those made to
2
Art. 234. Requirements of Registration. Any applicant
labor organization, association or group of unions or
workers shall acquire legal personality and shall be entitled
to the rights and privileges granted by law to legitimate
labor organizations upon issuance of the certificate of
registration based on the following requirements:
(a) Fifty pesos (P50.00) registration fee;
(b) The names of its officers, their addresses, the principal
address of the labor organization, the minutes of the
organizational meetings and the list of the workers who
participated in such meetings;
(c) The names of all its members comprising at least
twenty percent (20%) of all the employees in the
bargaining unit where it seeks to operate;
(d) If the applicant union has been in existence for one or
more years, copies of its annual financial reports; and
(e) Four (4) copies of the constitution and by‐laws of the
applicant union, minutes of its adoption or ratification, and
the list of the members who participated in it.
recognize the distinctions made in the law itself
between federations and their local chapters, and
independent unions; local chapters seemingly
have lesser requirements because they and their
members are deemed to be direct members of
the federation to which they are affiliated, which
federations are the ones subject to the strict
registration requirements of the law.
NOTE: Local chapter to be entitled to all rights
and privileges of a legitimate labor organization
upon submission of the following documents in
addition to the charter certificate:
1) The names of the local/chapter’s officers,
their addresses, the principal office of the
local/chapter, and;
2) The chapter’s constitution and by-laws
provided, that where the chapter’s constitution
and by-laws are the same as that of the
federation or the national union, that fact shall
be indicated accordingly.
San Miguel Corp Employees Union vs. San
Miguel Packing Employees Union (2007)
When an unregistered union becomes a branch,
local or chapter, some of the requirements for
registration are no longer necessary or
compulsory. Whereas an applicant for
registration of an independent union is
mandated to submit, among other things, the
number of employees and names of all its
members comprising at least 20% of the
employees in the bargaining unit where it seeks
to operate.
In sum, although PDMP as a trade union center
is a legitimate labor organization, it has no
power to directly create a local or chapter.
Thus, SMPPEU-PDMP cannot be created under
the more lenient requirements for chartering,
but must have complied with the more stringent
rules for creation and registration of an
independent union, including the 20%
membership requirement.
FACTS: Petitioner is the incumbent bargaining
agent for the bargaining unit comprised of the
regular monthly-paid rank and file employees of
the three divisions of San Miguel Corporation
namely San Miguel Corporate Staff Unit
(SMCSU), San Miguel Brewing Philippines
(SMBP), and the San Miguel Packaging
Products (SMPP)
Respondent is registered as a chapter of
Pambansang Diwa ng Manggagawang Pilipino.
Thereafter, respondent filed three separate
petitions for certification election to represent
SMPP, SMCSU, and SMBP. All three petitions
were dismissed, on the ground that the separate
petitions fragmented a single bargaining unit.
Petitioner filed with the DOLE-NCR a petition
seeking the cancellation of respondent’s
registration and its dropping from the rolls of
legitimate labor organizations. Petitioner
accused respondent of committing fraud and
falsification, and non-compliance with
registration requirements in obtaining its
certificate of registration. It raised allegations
that respondent violated Articles 239(a), (b) and
(c) and 234(c) of the Labor Code.
DOLE-NCR Regional Director Maximo B. Lim
found that respondent did not comply with the
20% membership requirement and, thus, ordered
the cancellation of its certificate of registration
and removal from the rolls of legitimate labor
organizations.
Bureau of Labor Relations: Reversed DOLE
NCR and declared that SM Packing Employees
shall hereby remain in the roster of legitimate
labor organizations
CA affirmed BLR
Petitioner’s contention: Petitioner posits that
respondent is required to submit a list of
members comprising at least 20% of the
employees in the bargaining unit before it may
acquire legitimacy, citing Article 234(c) of the
Labor Code. Petitioner also insists that the 20%
requirement for registration of respondent must
be based not on the number of employees of a
single division, but in all three divisions of the
company in all the offices and plants of SMC
since they are all part of one bargaining unit.
Petitioner thus maintains that respondent, in any
case, failed to meet this 20% membership
requirement since it based its membership on the
number of employees of a single division only,
namely, the SMPP.
ISSUE: WON SM Packing Employees met the
requirements and thus, must remain a legitimate
labor organization?
RULING: NO, SM Packing Employees failed
to meet the requirement. Hence, they cannot be
declared as a legitimate labor organization
A perusal of the records reveals that respondent
is registered with the BLR as a local or chapter
of PDMP. The applicable Implementing Rules
(Department Order No. 9) enunciates a two-fold
procedure for the creation of a chapter or a local.
The first involves the affiliation of an
independent union with a federation or national
union or industry union. The second, finding
application in the instant petition, involves the
direct creation of a local or a chapter through the
process of chartering. The Implementing Rules
stipulate that a local or chapter may be directly
created by a federation or national union.
Petitioner insists that Section 3 of the
Implementing Rules, as amended by Department
Order No. 9, violated Article 234 of the Labor
Code when it provided for less stringent
requirements for the creation of a chapter or
local. Article 234 of the Labor Code provides
that an independent labor organization acquires
legitimacy only upon its registration with the
BLR: xxx 3) The names of all its members
comprising at least twenty percent (20%) of all
the employees in the bargaining unit where it
seeks to operate; xxx
It is emphasized that the foregoing pertains to
the registration of an independent labor
organization, association or group of unions or
workers.
However, the creation of a branch, local or
chapter is treated differently. This Court, in the
landmark case of Progressive Development
Corporation v. Secretary, Department of
Labor and Employment, declared that when an
unregistered union becomes a branch, local or
chapter, some of the aforementioned
requirements for registration are no longer
necessary or compulsory. Whereas an applicant
for registration of an independent union is
mandated to submit, among other things, the
number of employees and names of all its
members comprising at least 20% of the
employees in the bargaining unit where it seeks
to operate, as provided under Article 234 of the
Labor Code and Section 2 of Rule III, Book V of
the Implementing Rules, the same is no longer
required of a branch, local or chapter. The intent
of the law in imposing less requirements in the
case of a branch or local of a registered
federation or national union is to encourage the
affiliation of a local union with a federation or
national union in order to increase the local
unions bargaining powers respecting terms and
conditions of labor.
Article 2343 now includes the term trade union
center, but interestingly, the provision indicating
3
SECTION 1. Article 234 of Presidential Decree No. 442,
as amended, otherwise known as the Labor Code of the
Philippines, is hereby further amended to read as follows:
ART. 234. Requirements of Registration. - A federation,
national union or industry or trade union center or an
independent union shall acquire legal personality and shall
be entitled to the rights and privileges granted by law to
legitimate labor organizations upon issuance of the
certificate of registration based on the following
requirements:
(a) Fifty pesos (P50.00) registration fee;
(b) The names of its officers, their addresses, the principal
address of the labor organization, the minutes of the
organizational meetings and the list of the workers who
participated in such meetings;
(c) In case the applicant is an independent union, the names
of all its members comprising at least twenty percent (20%)
of all the employees in the bargaining unit where it seeks to
operate;
(d) If the applicant union has been in existence for one or
more years, copies of its annual financial reports;
andcralawlibrary
(e) Four copies of the constitution and by-laws of the
applicant union, minutes of its adoption or ratification, and
the list of the members who participated in it.
SECTION 2. A new provision is hereby inserted into the
Labor Code as Article 234-A to read as follows:
ART. 234-A. Chartering and Creation of a Local Chapter. -
A duly registered federation or national union may directly
create a local chapter by issuing a charter certificate
indicating the establishment of the local chapter. The
chapter shall acquire legal personality only for purposes of
filing a petition for certification election from the date it
was issued a charter certificate.
The chapter shall be entitled to all other rights and
privileges of a legitimate labor organization only upon the
submission of the following documents in addition to its
charter certificate:
(a) The names of the chapter's officers, their addresses, and
the principal office of the chapter; andcralawlibrary
(b) The chapter's constitution and by-laws: Provided, That
where the chapter's constitution and by-laws are the same
as that of the federation or the national union, this fact shall
be indicated accordingly.
The additional supporting requirements shall be certified
under oath by the secretary or treasurer of the chapter and
attested by its president. (Emphasis ours.)
the procedure for chartering or creating a local
or chapter, namely Article 234-A, still makes no
mention of a "trade union center."
Also worth emphasizing is that even in the most
recent amendment of the implementing rules,
there was no mention of a trade union center as
being among the labor organizations allowed to
charter.
This Court deems it proper to apply the Latin
maxim expressio unius est exclusio alterius.
Under this maxim of statutory interpretation, the
expression of one thing is the exclusion of
another. When certain persons or things are
specified in a law, contract, or will, an intention
to exclude all others from its operation may be
inferred. If a statute specifies one exception to a
general rule or assumes to specify the effects of
a certain provision, other exceptions or effects
are excluded. Where the terms are expressly
limited to certain matters, it may not, by
interpretation or construction, be extended to
other matters. Such is the case here. If its intent
were otherwise, the law could have so easily and
conveniently included "trade union centers" in
identifying the labor organizations allowed to
charter a chapter or local. Anything that is not
included in the enumeration is excluded
therefrom, and a meaning that does not appear
nor is intended or reflected in the very language
of the statute cannot be placed therein. The rule
is restrictive in the sense that it proceeds from
the premise that the legislating body would not
have made specific enumerations in a statute if it
had the intention not to restrict its meaning and
confine its terms to those expressly
mentioned.58 Expressium facit cessare
tacitum.59 What is expressed puts an end to
what is implied. Casus omissus pro omisso
habendus est. A person, object or thing omitted
must have been omitted intentionally.
Therefore, since under the pertinent status and
applicable implementing rules, the power
granted to labor organizations to directly create a
chapter or local through chartering is given to a
federation or national union, then a trade union
center is without authority to charter directly.
The ruling of this Court in the instant case is not
a departure from the policy of the law to foster
the free and voluntary organization of a strong
and united labor movement, and thus assure the
rights of workers to self-organization. The
mandate of the Labor Code in ensuring strict
compliance with the procedural requirements for
registration is not without reason. It has been
observed that the formation of a local or chapter
becomes a handy tool for the circumvention of
union registration requirements. Absent the
institution of safeguards, it becomes a
convenient device for a small group of
employees to foist a not-so-desirable federation
or union on unsuspecting co-workers and pare
the need for wholehearted voluntariness, which
is basic to free unionism. As a legitimate labor
organization is entitled to specific rights under
the Labor Code and involved in activities
directly affecting public interest, it is necessary
that the law afford utmost protection to the
parties affected. However, as this Court has
enunciated in Progressive Development
Corporation v. Secretary of Department of
Labor and Employment, it is not this Court's
function to augment the requirements prescribed
by law. Our only recourse, as previously
discussed, is to exact strict compliance with
what the law provides as requisites for local or
chapter formation.
In sum, although PDMP as a trade union center
is a legitimate labor organization, it has no
power to directly create a local or chapter. Thus,
SMPPEU-PDMP cannot be created under the
more lenient requirements for chartering, but
must have complied with the more stringent
rules for creation and registration of an
independent union, including the 20%
membership requirement.
The Certificate of Registration of San Miguel
Packaging Union is ORDERED CANCELLED,
and DROPPED from the rolls of legitimate labor
organizations.
Heritage Hotel Manila vs. Pinag-Isang Galing
at Lakas ng mga Manggagawa sa Heritage
Manila (2009)
The Labor Code and its implementing rules do
not require that the number of members
appearing on the documents in question should
completely dovetail. For as long as the
documents and signatures are shown to be
genuine and regular and the constitution and
by-laws democratically ratified, the union is
deemed to have complied with registration
requirements.
Labor laws are liberally construed in favor of
labor especially if doing so would affirm it’s
constitutionally guaranteed right to self-
organization.
The right of any person to join an organization
also includes the right to leave that organization
and join another one.
FACTS: The Heritage Hotel Employees Union
(HHE) was formed in 2000 by certain rank and
file employees of herein petitioner Heritage
Hotel Manila, to which the Department of Labor
and Employment-National Capital Region
issued a certificate of registration. HHE filed a
petition for certification election which
petitioner opposed on the ground that HHE
misrepresented itself to be an independent
union, when in fact it was a local chapter of the
National Union of Workers in Hotel and
Restaurant and Allied Industries
(NUWHRAIN). It was also alleged that such
omitted disclosure was intentional because
petitioner's supervisors union was already
affiliated with it. Petitioner also filed a petition
to cancel the union's registration certificate. The
Med-Arbiter nevertheless granted HHE's
petition for certification election.
Petitioner appealed to the Secretary of Labor but
it was denied as well as its motion for
reconsideration, prompting petitioner to file a
petition for certiorari with the Court of Appeals.
The CA issued a writ of injunction against the
holding of HHE's certification election until the
petition for cancellation of its registration shall
have been resolved with finality.
In 2003, another union, herein respondent Pinag-
Isang Galing at Lakas ng mga Manggagawa sa
Heritage Manila (PIGLAS), was formed by
certain rank and file employees of petitioner at a
meeting. PIGLAS was issued its registration
certificate by the DOLE-NCR in 2004. HHE
later on adopted a resolution for its dissolution
and then filed a petition for cancellation of its
union registration.
PIGLAS filed a petition for certification election
which petitioner opposed alleging that the new
union's officers and members were also those
who comprised the old union. Petitioner
likewise alleged that PIGLAS was formed to
circumvent the CA's injunction earlier issued.
The Med-Arbiter nevertheless granted the
petition for certification election.
Petitioner filed a petition to cancel PIGLAS'
registration, claiming that the documents
submitted with the union's application for
registration bore the following false information:
(a) The List of Members showed that the
PIGLAS union had 100 union members; (b) The
Organizational Minutes said that 90 employees
attended the meeting on December 10, 2003; (c)
The Attendance Sheet of the meeting of
December 10, 2003 bore the signature of 127
members who ratified the union's Constitution
and By-Laws; and (d) The Signature Sheet bore
128 signatures of those who attended that
meeting.
Petitioner alleged that the misrepresentation was
evidenced by the discrepancy in the number of
union members appearing in the application and
the list as well as the number of signatories to
the attendance and signature sheets. The minutes
reported only 90 employees attended the
meeting. Petitioner also alleged that 33 members
of PIGLAS were members of HHE, which is in
violation of the policy against dual unionism.
DOLE-NCR denied petitioner's petition to
cancel PIGLAS' registration because the
discrepancies in the number of members in the
application's supporting documents were not
material and did not constitute
misrepresentation. The dual unionism is also not
a ground for canceling registration, since the
members of HHE simply exercised their right to
self-organization and freedom of association
when they joined PIGLAS. The Bureau of Labor
Relations affirmed the DOLE-NCR, by
reasoning that PIGLAS' organization meeting
lasted for 12 hours. Thus, it was possible for the
number of attendees to have increased as the
meeting progressed. Besides, the union only
needed 50 members of the total of 250
employees in the bargaining unit to comply with
the 20% membership requirement. Petitioner
filed a petition for certiorari with the Court of
Appeals but it was denied as well as petitioner's
motion for reconsideration. Hence, this petition
for review under Rule 45.
ISSUES:
(1) WON the union made fatal misrepresentation
in its application for union registration
(2) WON dual unionism is a ground for
canceling a union's registration.
RULING:
(1) NO. Petitioner has no evidence of the alleged
misrepresentation. The discrepancies alone
cannot be taken as indication that PIGLAS
misrepresented the information contained in
these documents. Charges of fraud and
misrepresentation should be clearly established
by evidence and surrounding circumstances
because once it is proved, the labor union
acquires none of the rights accorded to
registered organizations.
The discrepancies can be explained. While it
appears that in the minutes of the December 10,
2003 organizational meeting, only 90 employees
responded to the roll call at the beginning, it
cannot be assumed that such number could not
grow to 128 as reflected on meeting lasted 12
hours from 11:00am to 11:00pm. There is no
evidence that the meeting hall was locked up to
exclude late attendees. As to the fact that only
127 members ratified the union's constitution
and bylaws when 128 signed the attendance
sheet, it cannot be assumed that all those who
attended approved of such. Any member had the
right to hold out and refrain from ratifying those
documents or to simply ignore the process. The
Labor Code and its implementing rules do not
require that the number of members appearing
on the documents in question should completely
dovetail. For as long as the documents and
signatures are shown to be genuine and regular
and the constitution and by-laws democratically
ratified, the union is deemed to have complied
with registration requirements.
The discrepancy in the list of members (showing
only 100 members) and the signature and
attendance sheets (showing 127 or 128
members) submitted is immaterial. A
comparison of the documents shows that except
for six members, the names found in the list are
also in the attendance and signature sheets.
PIGLAS more than complied with the 20%
requirement since only 50 employees out of 250
employees in the bargaining unit were required
to unionize.
Labor laws are liberally construed in favor of
labor especially if doing so would affirm it’s
constitutionally guaranteed right to self-
organization. PIGLAS union's supporting
documents reveal the unmistakable yearning of
petitioner company's rank and file employees to
organize. This yearning should not be frustrated
by inconsequential technicalities.
(2) NO. The fact that some of respondent
PIGLAS union members were also members of
the old rank and file union, the HHE union, is
not a ground for canceling the new unions
registration. The right of any person to join an
organization also includes the right to leave that
organization and join another one. HHE union
ceased to exist, its certificate of registration
being already cancelled Thus, the petition is
denied.
Eagle Ridge vs CA (2010)
We have in precedent cases said that the
employees' withdrawal from a labor union made
before the filing of the petition for certification
election is presumed voluntary, while
withdrawal after the filing of such petition is
considered to be involuntary and does not affect
the same. Now then, if a withdrawal from union
membership done after a petition for
certification election has been filed does not
vitiate such petition, is it not but logical to
assume that such withdrawal cannot work to
nullify the registration of the union?
FACTS: Petitioner Eagle Ridge is a corporation
engaged in the business of maintaining golf
courses. It had, at the end of CY 2005, around
112 rank-and-file employees. On December 6,
2005, at least 20% of Eagle Ridge’s rank-and
file employees—the percentage threshold
required under Article 234(c) of the Labor Code
for union registration—had a meeting where
they organized themselves into an independent
labor union, named "Eagle Ridge Employees
Union" (EREU or Union), elected a set of
officers, and ratified their constitution and by-
laws. On December 19, 2005, EREU formally
applied for registration before the Department of
Labor and Employment (DOLE) Regional
Office IV (RO IV). In time, DOLE RO IV
granted the application. The EREU then filed a
petition for certification election in Eagle Ridge
Golf & Country Club. Eagle Ridge opposed this
petition, followed by its filing of a petition for
the cancellation of the application.
Eagle Ridge’s petition ascribed
misrepresentation, false statement, or fraud to
EREU in connection with the adoption of its
constitution and by-laws, the numerical
composition of the Union, and the election of its
officers. Petitioner alleged that the EREU
declared in its application for registration having
30 members, when the minutes of its December
6, 2005 organizational meeting showed it only
had 26 members. The misrepresentation was
exacerbated by the discrepancy between the
certification issued by the Union secretary and
president that 25 members actually ratified the
constitution and by-laws on December 6, 2005
and the fact that 26 members affixed their
signatures on the documents, making one
signature a forgery. Finally, petitioner contended
that five employees who attended the
organizational meeting had manifested the desire
to withdraw from the union. The five executed
individual affidavits or Sinumpaang Salaysay on
February 15, 2006, attesting that they arrived
late at said meeting which they claimed to be
drinking spree; that they did not know that the
documents they signed on that occasion
pertained to the organization of a union; and that
they now wanted to be excluded from the Union.
The withdrawal of the five, Eagle Ridge
maintained, effectively reduced the union
membership to 20 or 21, either of which is
below the mandatory minimum 20%
membership requirement under Art. 234(c) of
the Labor Code. Reckoned from 112 rank-and-
file employees of Eagle Ridge, the required
number would be 22 or 23 employees.
As a counterpoint, EREU alleged that
discrepancies are not real for before filing of its
application on December 19, 2005, four
additional employees joined the union on
December 8, 2005, thus raising the union
membership to 30 members as of December 19,
2005; that the understatement by one member
who ratified the constitution and by-laws was a
typographical error, which does not make it
either grave or malicious warranting the
cancellation of the union’s registration; that the
retraction of 5 union members should not be
given any credence for the reasons that:
(a) the sworn statements of the five retracting
union members sans other affirmative evidence
presented hardly qualify as clear and credible
evidence considering the joint affidavits of the
other members attesting to the orderly conduct
of the organizational meeting;
(b) the retracting members did not deny signing
the union documents;
(c) it can be presumed that "duress, coercion or
valuable consideration" was brought to bear on
the retracting members; and
(d) once the required percentage requirement has
been reached, the employees’ withdrawal from
union membership taking place after the filing
of the petition for certification election will not
affect the petition. After due proceedings, the
DOLE Regional Director, focusing on the
question of misrepresentation, issued an Order
finding for Eagle Ridge. Aggrieved, the Union
appealed to the BLR, which affirmed the
appealed order of the DOLE Regional Director.
Undeterred by successive setbacks, EREU
interposed a motion for reconsideration which
was granted. Eagle Ridge sought but was denied
reconsideration. Eagle Ridge thereupon went to
the CA, which dismissed the petition for
certiorari. The CA later denied Eagle Ridge’s
motion for reconsideration, hence the recourse
with the SC.
ISSUE: WON there was fraud in the application
to merit the cancellation of the EREU’s
registration
RULING: NO, a scrutiny of the records fails to
show any misrepresentation, false statement, or
fraud committed by EREU to merit cancellation
of its registration. The Supreme Court succinctly
explained this decision in eight points:
First. The Union submitted the required
documents attesting to the facts of the
organizational meeting on December 6, 2005,
the election of its officers, and the adoption of
the Union’s constitution and by-laws.
Second. The members of the EREU totaled 30
employees when it applied on December 19,
2005 for registration. The Union thereby
complied with the mandatory minimum 20%
membership requirement under Art. 234(c). Of
note is the undisputed number of 112 rank-and-
file employees in Eagle Ridge, as shown in the
Sworn Statement of the Union president and
secretary and confirmed by Eagle Ridge in its
petition for cancellation.
Third. The Union has sufficiently explained the
discrepancy between the number of those who
attended the organizational meeting showing 26
employees and the list of union members
showing 30. The difference is due to the
additional four members admitted two days after
the organizational meeting as attested to by their
duly accomplished Union Membership form.
Fourth. In its futile attempt to clutch at straws,
Eagle Ridge assails the inclusion of the
additional four members allegedly for not
complying with what it termed as "the sine qua
non requirements" for union member
applications under the Union’s constitution and
by-laws, specifically Sec. 2 of Art. IV. We are
not persuaded. Any seeming infirmity in the
application and admission of union membership,
most especially in cases of independent labor
unions, must be viewed in favor of valid
membership. The right of employees to self-
organization and membership in a union must
not be trammeled by undue difficulties. In this
case, when the Union said that the four
employee-applicants had been admitted as union
members, it is enough to establish the fact of
admission of the four that they had duly
signified such desire by accomplishing the
membership form. The fact, as pointed out by
Eagle Ridge, that the Union, owing to its scant
membership, had not yet fully organized its
different committees evidently shows the direct
and valid acceptance of the four employee
applicants rather than deter their admission— as
erroneously asserted by Eagle Ridge.
Fifth. The difference between the number of 26
members, who ratified the Union’s constitution
and by-laws, and the 25 members shown in the
certification of the Union secretary as having
ratified it, is, as shown by the factual
antecedents, a typographical error. It was an
insignificant mistake committed without malice
or prevarication. The list of those who attended
the organizational meeting shows 26 members,
as evidenced by the signatures beside their
handwritten names.
Sixth. In the more meaty issue of the affidavits
of retraction executed by six union members, we
hold that the probative value of these affidavits
cannot overcome those of the supporting
affidavits of 12 union members and their
counsel as to the proceedings and the conduct of
the organizational meeting on December 6,
2005. The DOLE Regional Director and the
BLR OIC Director obviously erred in giving
credence to the affidavits of retraction, but not
according the same treatment to the supporting
affidavits.
The six affiants of the affidavits of retraction
were not presented in a hearing before the
Hearing Officer (DOLE Regional Director), as
required under the Rules Implementing Book V
of the Labor Code covering Labor Relation. It is
settled that affidavits partake the nature of
hearsay evidence, since they are not generally
prepared by the affiant but by another who uses
his own language in writing the affiant’s
statement, which may thus be either omitted or
misunderstood by the one writing them. For
their non-presentation and consonant to the
above-quoted rule, the six affidavits of retraction
are inadmissible as evidence against the Union
in the instant case.
Seventh. The fact that six union members,
indeed, expressed the desire to withdraw their
membership through their affidavits of retraction
will not cause the cancellation of registration on
the ground of violation of Art. 234(c) of the
Labor Code requiring the mandatory minimum
20% membership of rank-and- file employees in
the employees’ union.
The six retracting union members clearly
severed and withdrew their union membership.
The query is whether such separation from the
Union can detrimentally affect the registration of
the Union. We answer in the negative. Twenty
percent (20%) of 112 rank-and-file employees in
Eagle Ridge would require a union membership
of at least 22 employees (112 x 205 = 22.4).
When the EREU filed its application for
registration on December 19, 2005, there were
clearly 30 union members. Thus, when the
certificate of registration was granted, there is no
dispute that the Union complied with the
mandatory 20% membership requirement. With
the withdrawal of six union members, there is
still compliance with the mandatory membership
requirement under Art. 234(c), for the remaining
24 union members constitute more than the 20%
membership requirement of 22 employees.
Eighth. Finally, it may not be amiss to note,
given the factual antecedents of the instant case,
that Eagle Ridge has apparently resorted to
filing the instant case for cancellation of the
Union’s certificate of registration to bar the
holding of a certification election. This can be
gleaned from the fact that the grounds it raised
in its opposition to the petition for certification
election are basically the same grounds it
resorted to in the instant case for cancellation of
EREU’s certificate of registration. This amounts
to a clear circumvention of the law and cannot
be countenanced.
SMCC-SUPER vs Charter Chemical (2011)
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.
FACTS: Samahang Manggagawa sa Charter
Chemical Solidarity of Unions in the Philippines
for Empowerment and Reforms (petitioner
union) filed a petition for certification election
among the regular rank-and-file employees of
Charter Chemical and Coating Corporation
(respondent company) with the Mediation
Arbitration Unit of the DOLE, National Capital
Region. Respondent company filed an Answer
with Motion to Dismiss on the ground that
petitioner union is not a legitimate labor
organization because of (1) failure to comply
with the documentation requirements set by law,
and (2) the inclusion of supervisory employees
within petitioner union.
MED-ARBITER RULING: Sided with the
company.
DOLE RULING: Granted the union’s petition
for a certification election.
CA RULING: Reversed the DOLE and upheld
the Med-Arbiter’s Ruling.
ISSUE: Does the commingling of supervisory
and rank-and-file employees in a union divest it
of its personality as a legitimate labor
organization?
RULING: NO. 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. Applying this
principle to the case at bar, petitioner union was
not divested of its status as a legitimate labor
organization even if some of its members were
supervisory employees. It had the right to file
the subject petition for certification election.
Besides, the legal personality of the union
cannot be collaterally attacked by the company
in the certification election proceedings the latter
being – in the eyes of the law – a mere bystander
in such proceedings.
Yokohama Tires vs. Yokohama Employees
Union (2010)
The charge that a labor organization committed
fraud and misrepresentation in securing its
registration is a serious charge and deserves
close scrutiny. It is serious because once such
charge is proved; the labor union acquires none
of the rights accorded to registered
organizations. Consequently, charges of this
nature should be clearly established by evidence
and the surrounding circumstances
FACTS: Yokohama Employees Union is the
labor organization of the rank-and file
employees of petition. YEU was registered as
legitimate labor union on 10 Sept 1999.
Respondent filed before Regional Office a
petition for certification election. Petitioner filed
a petition for revocation of YEU’s registration
when (1) YEU fraudulently included the
signature of Pineda in the organizational
documents; (2) Pineda was not aware of any
election of union officers; (3) YEU fraudulently
obtained employees signature by making them
believe that they were signing a petition for a
125% increase in the minimum wage, not a
petition for registration; (4) the employees did
not belong to a single bargaining unit; and (5)
YEU fraudulently stated in its organizational
meeting minutes that its second vice president
was Bernard David, not Bernardo David.
ISSUE: WON YEU committed fraud or
misrepresentation sufficing the revocation of its
registration?
RULING: No.
CA found that YEU did not commit grave fraud
or misrepresentation. The BLR correctly ruled
that the evidence to prove the participation of
YEU in the failure to delete Pineda’s signature
from the organizational document was wanting.
YTPI has the burden of proving the truthfulness
of its accusations.
In Heritage Hotel Manila v. Pinag-Isang
Galing at Lakas ng mga Manggagawa sa
Heritage Manila, the employer filed a petition
to revoke the registration of its rank-and-file
employees union, accusing it of committing
fraud and misrepresentation. The Court held that
the petition was rightfully denied because the
employer failed to prove that the labor union
committed fraud and misrepresentation. The
Court held that:
Did respondent PIGLAS union commit fraud
and misrepresentation in its application for
union registration? We agree with the DOLE-
NCR and the BLR that it did not. Except for the
evident discrepancies as to the number of union
members involved as these appeared on the
documents that supported the unions application
for registration, petitioner company has no
other evidence of the alleged misrepresentation.
But those discrepancies alone cannot be taken
as an indication that respondent misrepresented
the information contained in these documents.
The charge that a labor organization committed
fraud and misrepresentation in securing its
registration is a serious charge and deserves
close scrutiny. It is serious because once such
charge is proved, the labor union acquires none
of the rights accorded to registered
organizations. Consequently, charges of this
nature should be clearly established by evidence
and the surrounding circumstances.(Emphasis
supplied)
WHEREFORE, we DENY the petition. We
AFFIRM the 16 January 2004 Decision and 12
May 2004 Resolution of the Court of Appeals in
CA-G.R. SP No. 65460.
Takata Phils. vs. BLR (2014)
The 20% requirement does not apply to Art 234
(b) or to those who joined the org. meeting. 20%
only applies to 234 (c) or all employees in the
bargaining unit. The “Pangalan ng mga Kasapi
ng Unyon” showed 119 names; more than 20%
of 396. There was no proof that members did
not understand what they were signing. The two
repeated names is not a valid ground for
cancellation because they do not constitute
grave misrepresentation.
FACTS: July 7, 2009 – Takata Corp filed with
DOLE a petition for cancellation of Certificate
of Union Registration of respondent SALAMAT
(Union) They alleged that SALAMAT was
guilty of misrepresentation, false statements, and
fraud with respect to the number of those who
participated in their organizational meeting, the
adoption and ratification of its Constitution and
by-laws, and in the election of its officers.
Takata’s contentions o In the May 1, 2009
organizational meeting, only 68 signed the
attendance sheet out of 396 rank-and-file
employees.
“Pangalan ng mga Kasapi ng Unyon” (PKU)
bore no signatures of the 119 members and that
the employees were not given sufficient
information on the document they signed.
The document “Sama-Samang Pahayag ng
Pagsapi” (SPP) was not submitted at the time of
application for union registration o 119 members
were only 117 o total number of employees as of
May 1, 2009 was 470, not 396.
DOLE Director Atty. Ricardo Martinez granted
petition for cancellation.
68 is less than 20% of 396 hence, short of union
registration requirement. The attendance sheet
containing the names and signatures of 68
members contradicted list of names in the PKU.
SPP was not attached to the application for
registration; only submitted in the petition for
certification election *Bukluran ng
Manggagawang Pilipino (BMP) Paralegal
Officer Domingo Mole filed an appeal on behalf
of SALAMAT to BLR. Later, the counsel of
SALAMAT filed own appeal w/ BLR.
Takata opposed on ground of forum shopping.
Bureau of Labor Relations: Reversed DOLE
Director.
Takata failed to prove the deliberate and
malicious misrepresentation of number of r-a-f
employees.
The list of employees who participated in the
organizational meeting is a separate and
disctinct requirement from list of names
comprising at least 20% of employees in the
bargaining unit and there was no evidence that
employees assailed their inclusion in the list of
union members
ISSUE: WON SALAMAT committed
misrepresentation, false statements, or fraud as a
ground for cancelling registration?
RULING: No.
It does not appear in Art 234 (b) that attendees
in the organizational meeting must comprise at
least 20% of the bargaining unit. Only in Art
234 (c) that requires the names of all its
members comprising at least twenty percent
(20%) of all the employees in the bargaining
unit where it seeks to operate. Clearly, the 20%
minimum requirement pertains to the
employees’ membership in the union and not to
the list of workers who participated in the
organizational meeting.
(b) and (c) provide for separate requirements.
Total number of employees was 396: 20% of
which is about 79. The 119 member who signed
the PKU sufficiently complied with the 20%
requirement. The 68 members who attended the
org meeting were enough to constitute a quorum
to validly ratify their Constitution and its by-
laws of the union.
For fraud and misrepresentation to be a ground
for cancellation under Art 239, nature must be
grave and compelling enough to vitiate consent
of a majority of union members
No proof as to the lack of information given to
those who signed PKU. No member came
forward to deny their membership in
SALAMAT. Signing the SPP showed their
strengthening of desire to joing union.
The two repeated names cannot be considered
misrepresentation absent any showing that
SALAMAT did so deliberately to increase union
membership. Even if the employees were 470,
instead of 396, 117 (without two repeated
names) is still more than 20%.
Philippine Skylanders Inc. vs. NLRC (2002)
The mere act of disaffiliation did not divest
PSEA of its own personality; neither did it give
PAFLU the license to act independently of the
local union. Recreant to its mission, PAFLU
cannot simply ignore the demands of the local
chapter and decide for its welfare. PAFLU
might have forgotten that as an agent it could
only act in representation of and in accordance
with the interests of the local union.
FACTS: Philippine Skylanders Employees
Association (PSEA), a local labor union
affiliated with the Philippine Association of Free
Labor Unions (PAFLU) September (PAFLU),
won in the certification election conducted
among the rank and file employees of Philippine
Skylanders, Inc. (PSI). Its rival union, Philippine
Skylanders Employees Association-WATU
(PSEA-WATU) immediately protested the result
of the election before the Secretary of Labor.
PSEA sent PAFLU a notice of disaffiliation
citing as reason PAFLU's supposed deliberate
and habitual dereliction of duty toward its
members. Attached to the notice was a copy of
the resolution adopted and signed by the officers
and members of PSEA authorizing their local
union to disaffiliate from its mother federation.
PSEA subsequently affiliated itself with the
National Congress of Workers (NCW), changed
its name to Philippine Skylanders Employees
Association - National Congress of Workers
(PSEA-NCW), and to maintain continuity within
the organization, allowed the former officers of
PSEA-PAFLU to continue occupying their
positions as elected officers in the newly-forged
PSEA-NCW.
PSEA-NCW entered into a collective bargaining
agreement with PSI which was immediately
registered with the Department of Labor and
Employment. PAFLU Secretary General Serafin
Ayroso wrote Mariles C. Romulo requesting a
copy of PSI's audited financial statement.
Ayroso explained that with the dismissal of
PSEA-WATUs election protest the time was
ripe for the parties to enter into a collective
bargaining agreement. PSI denied the request
citing as reason PSEA's disaffiliation from
PAFLU and its subsequent affiliation with
NCW.
PAFLU filed a complaint for unfair labor
practice against PSI. PAFLU alleged that aside
from PSIs refusal to bargain collectively with its
workers, the company through its president and
personnel manager, was also liable for
interfering with its employees' union activities.
In another complaint, PAFLU claimed that
Dakila was present in PSEA's organizational
meeting thereby confirming his illicit
participation in union activities. Ayroso added
that the members of the local union had
unwittingly fallen into the manipulative
machinations of PSI and were lured into
endorsing a collective bargaining agreement
which was detrimental to their interests. These
two were consolidated. PSEA-NCW took the
cudgels for its officers who were being sued in
their capacities as former officers of
PSEAPAFLU and asserted that since PSEA was
no longer affiliated with PAFLU, Ayroso or
PAFLU for that matter had no personality to file
the instant complaint.
LABOR ARBITER’S RULING: declared
PSEA's disaffiliation from PAFLU invalid and
held PSI, PSEA-PAFLU and their respective
officers guilty of unfair labor practice.
According to the Labor Arbiter, this was a
classic case of interference for which PSI could
be held responsible. Its collective bargaining
agreement with PSI was struck down for being
invalid.
NLRC: Upheld LA
NOTE: The issue of disaffiliation is an inter-
union conflict the jurisdiction of which properly
lies with the Bureau of Labor Relations (BLR)
and not with the Labor Arbiter. Nonetheless,
with due recognition of this fact, we deem it
proper to settle the controversy at this instance
since to remand the case to the BLR would only
mean intolerable delay for the parties.
ISSUE: WON PSEA, which is an independent
and separate local union, can validly disaffiliate
from PAFLU pending the settlement of an
election protest questioning its status as the sole
and exclusive bargaining agent of PSI's rank and
file employees?
RULING: Yes.
The pendency of an election protest involving
both the mother federation and the local union
did not constitute a bar to a valid disaffiliation.
There is nothing shown in the records nor is it
claimed by PAFLU that the local union was
expressly forbidden to disaffiliate from the
federation nor were there any conditions
imposed for a valid breakaway.
We upheld the right of local unions to separate
from their mother federation on the ground that
as separate and voluntary associations, local
unions do not owe their creation and existence to
the national federation to which they are
affiliated but, instead, to the will of their
members. The sole essence of affiliation is to
increase, by collective action, the common
bargaining power of local unions for the
effective enhancement and protection of their
interests. Admittedly, there are times when
without succor and support local unions may
find it hard, unaided by other support groups, to
secure justice for themselves.
Yet the local unions remain the basic units of
association, free to serve their own interests
subject to the restraints imposed by the
constitution and by-laws of the national
federation, and free also to renounce the
affiliation upon the terms laid down in the
agreement which brought such affiliation into
existence.
Neither was it disputed by PAFLU that 111
signatories out of the 120 members of the local
union, or an equivalent of 92.5% of the total
union membership supported the claim of
disaffiliation and had in fact disauthorized
PAFLU from instituting any complaint in their
behalf. Surely, this is not a case where one (1) or
two (2) members of the local union decided to
disaffiliate from the mother federation, but it is a
case where almost all local union members
decided to disaffiliate.
It was entirely reasonable then for PSI to enter
into a collective bargaining agreement with
PSEA-NCW. As PSEA had validly severed
itself from PAFLU, there would be no
restrictions which could validly hinder it from
subsequently affiliating with NCW and entering
into a collective bargaining agreement in behalf
of its members.
The mere act of disaffiliation did not divest
PSEA of its own personality; neither did it give
PAFLU the license to act independently of the
local union. Recreant to its mission, PAFLU
cannot simply ignore the demands of the local
chapter and decide for its welfare. PAFLU might
have forgotten that as an agent it could only act
in representation of and in accordance with the
interests of the local union.
Petitions of Philippine Skylanders, Inc. and of
Philippine Skylanders and Workers Association-
NCW, together with their respective officers,
were GRANTED
ANGLO-KMU vs. SAMANA BAY (1996)
Generally, 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. However, even before the onset of the
freedom period, disaffiliation may be carried
out when there is a shift of allegiance on the
part of the majority of the members of the union.
A local labor union is a separate and distinct
unit primarily designed to secure and maintain
an equality of bargaining power between the
employer and their employee-members. A local
union does not owe its existence to the
federation with which it is affiliated. It is a
separate and distinct voluntary association
owing its creation to the will of its members.
The mere act of affiliation does not divest the
local union of its own personality, neither does
it give the mother federation the license to act
independently of the local union. It only gives
rise to a contract of agency where the former
acts in representation of the latter.
FACTS: Petitioner Alliance of Nationalist and
Genuine Labor Organization (ANGLO for
brevity) is a duly registered labor organization
while respondent union Samahan Ng Mga
Mangagawang Nagkakaisa sa Manila Bay
Spinning Mills and J.P. Coats (SAMANA BAY
for brevity) is its affiliate. In representation of
SAMANA BAY, ANGLO entered and
concluded a Collective Bargaining Agreement
(CBA) with Manila Bay Spinning Mills and J.P.
Coats Manila Bay, Inc. (hereinafter referred to
as the corporations) on November 1, 1991. On
December 4, 1993, the Executive Committee of
SAMANA BAY decided to disaffiliate from
ANGLO in view of the latter's dereliction of its
duty to promote and advance the welfare of
SAMANA BAY and the alleged cases of
corruption involving the federation officers. Said
disaffiliation was unanimously confirmed by the
members of SAMANA BAY.
On April 4, 1994, a petition to stop remittance of
federation dues to ANGLO was filed by
SAMANA BAY with the Bureau of Labor
Relations on the ground that the corporations,
despite having been furnished copies of the
union resolution relating to said disaffiliation,
refused to honor the same. ANGLO
counteracted by unseating all officers and board
members of SAMANA BAY and appointing, in
their stead, a new set of officers who were duly
recognized by the corporations.
In its position paper, ANGLO contended that the
disaffiliation was void considering that a
collective bargaining agreement is still existing
and the freedom period has not yet set in. The
Med-Arbiter resolved that the disaffiliation was
void but upheld the illegality of the ouster
officers of SAMANA BAY. Both parties filed
their respective appeals with the Department of
Labor and Employment. In a resolution dated
September 23, 1994, herein public respondent
modified the order and ruled in favor of
respondent union.
ANGLO filed a motion for reconsideration but
the same was denied for lack of merit. Hence,
this petition for certiorari under Rule 65.
ISSUE:
1) WON disaffiliation was valid; and
2) WON petitioner can validly oust individual
private respondents from their positions?
RULING:
1) Yes, disaffiliation was valid.
Petitioner ANGLO wants to impress on us that
the disaffiliation was invalid for two reasons,
namely: that the procedural requirements for a
valid disaffiliation were not followed; and that it
was made in violation of P.D. 1391.
Anent the first ground, we reiterate the rule that
all employees enjoy the right to self-
organization and to form and join labor
organizations of their own choosing for the
purpose of collective bargaining. This is a
fundamental right of labor and derives its
existence from the Constitution. In interpreting
the protection to labor and social justice
provisions of the Constitution and the labor
laws, rules or regulations, we have always
adopted the liberal approach which favors the
exercise of labor rights.
This Court is not ready to bend this principle to
yield to a mere procedural defect, to wit: failure
to observe certain procedural requirements for a
valid disaffiliation. Non-compliance with the
procedure on disaffiliation, being premised on
purely technical grounds cannot rise above the
fundamental right of self- organization.
We quote, with approval, the findings of herein
public respondent, that:
"x x x the resolution of the general membership
ratifying the disaffiliation action initiated by the
Board, substantially satisfies the procedural
requirements for disaffiliation. No doubt was
raised on the support of the majority of the
union members on the decision to disaffiliate."
This, to our mind, is clearly supported by the
evidence. ANGLO's alleged acts inimical to the
interests of respondent union have not been
sufficiently rebutted. It is clear under the facts
that respondent union's members have
unanimously decided to disaffiliate from the
mother federation and ANGLO has nothing to
offer in dispute other than the law prohibiting
the disaffiliation outside the freedom period.
In the same wise, we find no ground for ruling
against the validity of the disaffiliation in the
light of recent jurisprudential rules.
Although P.D. 1391 provides:
"Item No. 6. No petition for certification
election, for intervention and disaffiliation shall
be entertained or given due course except within
the 60-day freedom period immediately
preceding the expiration of a collective
bargaining agreement,"
Said law is definitely not without exceptions.
Settled is the rule that a local union has the right
to disaffiliate from its mother union when
circumstances warrant. Generally, 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. However, even before
the onset of the freedom period, disaffiliation
may be carried out when there is a shift of
allegiance on the part of the majority of the
members of the union.
2) No.
ANGLO contends that individual private
respondents were validly ousted as they have
ceased to be officers of the incumbent union
(ANGLO-KMU) at the time of disaffiliation. In
order to fill the vacuum, it was deemed proper to
appoint the individual replacements so as not to
put in disarray the organizational structure and
to prevent chaos and confusion among the
general membership and within the company.
The contention is bereft of merit. A local labor
union is a separate and distinct unit primarily
designed to secure and maintain an equality of
bargaining power between the employer and
their employee-members. A local union does not
owe its existence to the federation with which it
is affiliated. It is a separate and distinct
voluntary association owing its creation to the
will of its members. The mere act of affiliation
does not divest the local union of its own
personality, neither does it give the mother
federation the license to act independently of the
local union. It only gives rise to a contract of
agency where the former acts in representation
of the latter.
By SAMANA BAY's disaffiliation from
ANGLO, the vinculum that previously bound
the two entities was completely severed.
ANGLO was divested of any and all power to
act in representation of SAMANA BAY. Thus,
any act performed by ANGLO affecting the
interests and affairs of SAMANA BAY,
including the ouster of herein individual private
respondents, is rendered without force and
effect.
WHEREFORE, premises considered, the
petition is hereby DISMISSED.
Cirtek Employees Labor Union vs. Cirtek
Electronics Inc. (2010)
A local labor union is a separate and distinct
unit primarily designed to secure and maintain
an equality of bargaining power between the
employer and their employee-members. A local
union does not owe its existence to the
federation with which it is affiliated. It is a
separate and distinct voluntary association
owing its creation to the will of its members.
The mere act of affiliation does not divest the
local union of its own personality, neither does
it give the mother federation the license to act
independently of the local union. It only gives
rise to a contract of agency where the former
acts in representation of the latter.
FACTS: In 2005, a CBA dispute arose between
Cirtek Electronics and Cirtek Employees Labor
Union (CELU). The dispute revolved around the
provisions on the yearly wage increase. A
deadlock ensued as well as a strike. The
Secretary of Labor took over the case.
While the case was pending, Cirtek and CELU
entered into a Memorandum of Agreement
(MOA) whereby Cirtek agreed to increase the
wage by P9.00 per day. Later, Secretary of
Labor finally came up with a decision ordering
Cirtek to increase the employees’ wages by a
minimum of P10.00 to a maximum of P15.00
per day.
Cirtek assailed the order of the Secretary on the
ground that it violates the MOA. CELU on the
other hand agreed with the Secretary invoking
that Cirtek agreed that should the Secretary
order for a higher wage increase, the same
should be followed and not the MOA. This
agreement was however not included in the
MOA but was embodied in the minutes of the
meeting when the MOA was done.
ISSUE: WON the Secretary of Labor may issue
an order superseding the said MOA.
RULING: Yes. The order was issued in
resolution of the CBA dispute over which the
Secretary assumed jurisdiction. The order is an
arbitral award which can be considered an
approximation of a collective bargaining
agreement which would otherwise have been
entered into by the parties; hence, it has the
force and effect of a valid contract obligation.
The Supreme Court, however, clarified that the
Secretary’s order should be complied not merely
because it is higher than what the MOA
provides. The order was based on evidentiary
documents presented by both parties particularly
on the financial outlook of Cirtek.
But was it proper for the Secretary to decide the
case despite the submission of the MOA?
Yes, in the first place, CELU manifested that the
MOA was entered into subject to a more
favorable decision by the Secretary. Further, it
bears noting that since the filing and submission
of the MOA did not have the effect of divesting
the Secretary of his jurisdiction, or of
automatically disposing the controversy, then
neither should the provisions of the MOA
restrict the Secretary’s leeway in deciding the
matters before him.
The agreement that the MOA provision may be
superseded by a more favorable order by the
Secretary was not contained in the MOA itself,
does this bind Cirtek?
Yes. In labor cases pending before the
Commission or the Labor Arbiter [in this case,
the Secretary of Labor], the rules of evidence
prevailing in courts of law or equity are not
controlling. Rules of procedure and evidence are
not applied in a very rigid and technical sense in
labor cases. Hence, the Labor Arbiter is not
precluded from accepting and evaluating
evidence other than, and even contrary to, what
is stated in the CBA. Therefore, the agreement
binds Cirtek and can be proven by mere
presentation of the minutes. In short, the parol
evidence rule is not applicable to labor cases.
2011 MR
FACTS: This resolves the motion for
reconsideration and supplemental motion for
reconsideration filed by respondent, Cirtek
Electronics, Inc., of the Court’s Decision dated
November 15, 2010.
Respondent-movant maintains that the Secretary
of Labor cannot insist on a ruling beyond the
compromise agreement entered into by the
parties; and that, as early as February 5, 2010,
petitioner Union had already filed with the
Department of Labor and Employment (DOLE)
a resolution of disaffiliation from the Federation
of Free Workers resulting in the latter’s lack of
personality to represent the workers in the
present case.
ISSUE: WON petitioner lost its personality to
represent the workers because of its
disaffiliation from the Federation of Free
Workers?
RULING: The issue of disaffiliation is an intra-
union dispute which must be resolved in a
different forum in an action at the instance of
either or both the FFW and the Union or a rival
labor organization, not the employer.
Indeed, as respondent-movant itself argues, a
local union may disaffiliate at any time from its
mother federation, absent any showing that the
same is prohibited under its constitution or rule.
Such, however, does not result in it losing its
legal personality altogether. Verily, Anglo-
KMU v. Samahan Ng Mga Manggagawang
Nagkakaisa Sa Manila Bay Spinning Mills At
J.P. Coats enlightens:
A local labor union is a separate and distinct
unit primarily designed to secure and maintain
an equality of bargaining power between the
employer and their employee-members. A local
union does not owe its existence to the
federation with which it is affiliated. It is a
separate and distinct voluntary association
owing its creation to the will of its members.
The mere act of affiliation does not divest the
local union of its own personality, neither does
it give the mother federation the license to act
independently of the local union. It only gives
rise to a contract of agency where the former
acts in representation of the latter. (emphasis
and underscoring supplied)
MR is denied.
LEGEND International vs. KML (2011)
The legal personality of a legitimate labor
organization cannot be subject to a collateral
attack. The law is very clear on this matter. The
Implementing Rules stipulate that a labor
organization shall be deemed registered and
vested with legal personality on the date of
issuance of its certificate of registration. Once a
certificate of registration is issued to a union, its
legal personality cannot be subject to a
collateral attack. It may be questioned only in
an independent petition for cancellation in
accordance with Section 5 of Rule V, Book V of
the Implementing Rules.
FACTS: KML filed with Med Arbitration Unit
of DOLE a Petition for Certification Election.
KML alleged that it is a legitimate labor
organization. Legend moved to dismiss the
petition alleging that KML is not a legitimate
labor organization because its membership is a
mixture of rank-and-file and supervisory
employees in violation of Art. 245 of the Labor
Code.
Med-Arbiter ruled in favor of Petitioner, KML
appealed to Sec. of DOLE, Sec. ruled that that
KMLs legitimacy as a union could not be
collaterally attacked, citing Section 5, Rule V of
Department Order No. 9, series of 1997.
In a Resolution dated August 20, 2002, the
Office of the Secretary of DOLE denied
LEGENDs motion for reconsideration. It opined
that Section 11, paragraph II (a), Rule XI of
Department Order No. 9 requires a final order of
cancellation before a petition for certification
election may be dismissed on the ground of lack
of legal personality.
ISSUE:WON the legal personality of KML can
be collaterally attacked?
RULING: No, it cannot be collaterally attacked
Based on the foregoing jurisprudence, it is clear
that a certification election may be conducted
during the pendency of the cancellation
proceedings. This is because at the time the
petition for certification was filed, the
petitioning union is presumed to possess the
legal personality to file the same. There is
therefore no basis for LEGENDs assertion that
the cancellation of KMLs certificate of
registration should retroact to the time of its
issuance or that it effectively nullified all of
KMLs activities, including its filing of the
petition for certification election and its demand
to collectively bargain.
In Laguna Autoparts Manufacturing
Corporation v. Office of the Secretary,
Department of Labor and Employment, the
Court ruled that such legal personality may not
be subject to a collateral attack but only through
a separate action instituted particularly for the
purpose of assailing it.
The legal personality of a legitimate labor
organization cannot be subject to a collateral
attack. The law is very clear on this matter.
The Implementing Rules stipulate that a labor
organization shall be deemed registered and
vested with legal personality on the date of
issuance of its certificate of registration. Once a
certificate of registration is issued to a union, its
legal personality cannot be subject to a collateral
attack. In may be questioned only in an
independent petition for cancellation in
accordance with Section 5 of Rule V, Book V of
the Implementing Rules.
United PEPSI-COLA vs. Laguesma
A distinction exists between those who have the
authority to devise, implement and control
strategic and operational policies (top and
middle managers) and those whose task is
simply to ensure that such policies are carried
out by the rank-and-file employees of an
organization (first-level managers/supervisors).
What distinguishes them from the rank-and-file
employees is that they act in the interest of the
employer in supervising such rank-and-file
employees.
“Managerial employees” may therefore be said
to fall into two distinct categories: the
“managers” per se, who compose the former
group described above, and the “supervisors”
who form the latter group.
FACTS: Petitioner is a union of supervisory
employees. It appears that on March 20, 1995
the union filed a petition for certification
election on behalf of the route managers at
Pepsi-Cola Products Philippines, Inc. However,
its petition was denied by the med-arbiter and,
on appeal, by the Secretary of Labor and
Employment, on the ground that the route
managers are managerial employees and,
therefore, ineligible for union membership under
the first sentence of Art. 245 of the Labor Code,
which provides:
Ineligibility of managerial employees to join any
labor organization; right of supervisory
employees. — Managerial employees are not
eligible to join, assist or form any labor
organization. Supervisory employees shall not
be eligible for membership in a labor
organization of the rank-and-file employees but
may join, assist or form separate labor
organizations of their own.
Petitioner brought this suit challenging the
validity of the order, dismissed.
Hence, this petition. Pressing for resolution its
contention that the first sentence of Art. 245 of
the Labor Code, so far as it declares managerial
employees to be ineligible to form, assist or join
unions, contravenes Art. III, Sec. 8 of the
Constitution which provides:
The right of the people, including those
employed in the public and private sectors, to
form unions, associations, or societies for
purposes not contrary to law shall not be
abridged.
ISSUES:
(1) WON the route managers at Pepsi-Cola
Products Philippines, Inc. are managerial
employees and;
(2) WON Art. 245, insofar as it prohibits
managerial employees from forming, joining or
assisting labor unions, violates Art. III, Sec. 8 of
the Constitution.
RULING:
(1) Yes, the route managers at Pepsi-Cola are
managerial employees.
As a class, managers constitute three levels of a
pyramid: (1) Top management; (2) Middle
Management; and (3) First-line Management
[also called supervisors].
FIRST-LINE MANAGERS — The lowest
level in an organization at which individuals are
responsible for the work of others is called first-
line or first-level management. First-line
managers direct operating employees only; they
do not supervise other managers. Examples of
first-line managers are the “foreman” or
production supervisor in a manufacturing plant,
the technical supervisor in a research
department, and the clerical supervisor in a large
office. First-level managers are often called
supervisors.
MIDDLE MANAGERS — The term middle
management can refer to more than one level in
an organization. Middle managers direct the
activities of other managers and sometimes also
those of operating employees. Middle managers’
principal responsibilities are to direct the
activities that implement their organizations’
policies and to balance the demands of their
superiors with the capacities of their
subordinates. A plant manager in an electronics
firm is an example of a middle manager.
TOP MANAGERS — Composed of a
comparatively small group of executives, top
management is responsible for the overall
management of the organization. It establishes
operating policies and guides the organization’s
interactions with its environment. Typical titles
of top managers are “chief executive officer,”
“president,” and “senior vice-president.” Actual
titles vary from one organization to another and
are not always a reliable guide to membership in
the highest management classification.
A distinction exists between those who have the
authority to devise, implement and control
strategic and operational policies (top and
middle managers) and those whose task is
simply to ensure that such policies are carried
out by the rank-and-file employees of an
organization (first-level managers/supervisors).
What distinguishes them from the rank-and-file
employees is that they act in the interest of the
employer in supervising such rank-and-file
employees.
“Managerial employees” may therefore be said
to fall into two distinct categories: the
“managers” per se, who compose the former
group described above, and the “supervisors”
who form the latter group.
It appears that this question was the subject of
two previous determinations by the Secretary of
Labor and Employment, in accordance with
which this case was decided by the med-arbiter.
To qualify as managerial employee, there must
be a clear showing of the exercise of managerial
attributes under paragraph (m), Article 212 of
the Labor Code as amended. Designations or
titles of positions are not controlling. As to the
route managers and accounting manager, we are
convinced that they are managerial employees.
Their job descriptions clearly reveal so
(Worker’s Alliance Trade Union (WATU) v.
Pepsi-Cola Products Philippines, Inc., Nov. 13,
1991).
This finding was reiterated in Case No. OS-A-3-
71-92, Titled In Re: Petition for Direct
Certification and/or Certification Election-Route
Managers/Supervisory Employees of Pepsi-Cola
Products Phils.Inc.
*doctrine of res judicata certainly applies to
adversary administrative proceedings
Thus, we have in this case an expert’s view that
the employees concerned are managerial
employees within the purview of Art. 212.
At the very least, the principle of finality of
administrative determination compels respect for
the finding of the Secretary of Labor that route
managers are managerial employees as defined
by law in the absence of anything to show that
such determination is without substantial
evidence to support it.
The Court now finds that the job evaluation
made by the Secretary of Labor is indeed
supported by substantial evidence. The nature of
the job of route managers is given in a four-page
pamphlet, prepared by the company, called
“Route Manager Position Description,” the
pertinent parts of which read:
A. BASIC PURPOSE
A Manager achieves objectives through others.
As a Route Manager, your purpose is to meet
the sales plan; and you achieve this objective
through the skillful MANAGEMENT OF YOUR
JOB AND THE MANAGEMENT OF YOUR
PEOPLE.
These then are your functions as Pepsi-Cola
Route Manager. Within these functions —
managing your job and managing your people
— you are accountable to your District
Manager for the execution and completion of
various tasks and activities which will make it
possible for you to achieve your sales
objectives.
xxxx
Distinction is evident in the work of the route
managers which sets them apart from
supervisors in general. Unlike supervisors who
basically merely direct operating employees in
line with set tasks assigned to them, route
managers are responsible for the success of the
company’s main line of business through
management of their respective sales teams.
Such management necessarily involves the
planning, direction, operation and evaluation of
their individual teams and areas which the work
of supervisors does not entail.
The route managers cannot thus possibly be
classified as mere supervisors because their
work does not only involve, but goes far beyond,
the simple direction or supervision of operating
employees to accomplish objectives set by those
above them.
While route managers do not appear to have the
power to hire and fire people (the evidence
shows that they only “recommended” or
“endorsed” the taking of disciplinary action
against certain employees), this is because this is
a function of the Human Resources or Personnel
Department of the company.
(2) No, the law is constitutional.
Art.245 is the result of the amendment of the
Labor Code in 1989 by R.A. No. 6715,
otherwise known as the Herrera-Veloso Law.
Unlike the Industrial Peace Act or the provisions
of the Labor Code which it superseded, R.A. No.
6715 provides separate definitions of the terms
“managerial” and “supervisory employees,” as
follows:
Art. 212. Definitions.
(m) “managerial employee” is one who is
vested with powers or prerogatives to lay down
and execute management policies and/or to hire
transfer, suspend, lay off, recall, discharge,
assign or discipline employees. Supervisory
employees are those who, in the interest of the
employer, effectively recommend such
managerial actions if the exercise of such
authority is not merely routinary or clerical in
nature but requires the use of independent
judgment. All employees not falling within any
of the above definitions are considered rank-
and-file employees for purposes of this Book.
The distinction between top and middle
managers, who set management policy, and
front-line supervisors, who are merely
responsible for ensuring that such policies are
carried out by the rank and file, is articulated in
the present definition. When read in relation to
this definition in Art. 212(m), it will be seen that
Art. 245 faithfully carries out the intent of the
Constitutional Commission in framing Art. III,
Sec. 8 of the fundamental law.
*Framer’s Intent: MR. LERUM. My amendment
is on Section 7, page 2, line 19, which is to
insert between the words “people” and “to” the
following: WHETHER EMPLOYED BY THE
STATE OR PRIVATE ESTABLISHMENTS. In
other words, the section will now read as
follows: “The right of the people WHETHER
EMPLOYED BY THE STATE OR PRIVATE
ESTABLISHMENTS to form associations,
unions, or societies for purposes not contrary to
law shall not be abridged.”
Nor is the guarantee of organizational right in
Art. III, Sec. 8 infringed by a ban against
managerial employees forming a union. The
right guaranteed in Art. III, Sec. 8 is subject to
the condition that its exercise should be for
purposes “not contrary to law.” In the case of
Art. 245, there is a rational basis for prohibiting
managerial employees from forming or joining
labor organizations.
PETITION is DISMISSED.
Pinagkakaisa na mga Manggagawa sa
Triumph International-United Lumber and
General Workers of the Philippines vs.
Calleja (1990)
The ends of unionism are better served if all the
rank-and-file employees with substantially the
same interests and who invoke their right to
self-organization are part of a single unit so that
they can deal with their employer with just one
and yet potent voice. The employees’ bargaining
power with management is strengthened
thereby. Hence, the circumstances of this case
impel us to disallow the holding of a
certification election among the workers sought
to be represented by the respondent union for
want of proof that the right of said workers to
self-organization is being suppressed.
FACTS: The petitioner is the recognized
collective bargaining agent of the rank-and-file
employees of Triumph International with which
the latter has a valid and existing collective
bargaining agreement effective up to September
24, 1989.
On November 25, 1987, a petition for
certification election was filed by the respondent
union with the Department of Labor and
Employment.
On January 30, 1988, a motion to dismiss the
petition for certification election was filed by
Triumph International on the grounds that the
respondent union cannot lawfully represent
managerial employees and that the petition
cannot prosper by virtue of the contract-bar rule.
On the same grounds, the petitioner, as
intervenor, filed its opposition to the petition on
February 18, 1988.
On April 13, 1988, the Labor Arbiter issued an
order granting the petition for certification
election and directing the holding of a
certification election to determine the sole and
exclusive bargaining representative of all
monthly-paid administrative, technical,
confidential and supervisory employees of
Triumph International.
On appeal, the public respondent on August 24,
1988 affirmed the Labor Arbiter’s order.
On September 5, 1988, Triumph International
filed a motion for reconsideration which was
denied by the public respondent in a resolution
dated October 28, 1988.
ISSUE: WON the public respondent gravely
abused its discretion in ordering the immediate
holding of a certification election among the
workers sought to be represented by the
respondent union?
RULING: Yes.
There is no evidence in the records which
sufficiently distinguishes and clearly separates
the group of employees sought to be represented
by the private respondents into managerial and
supervisory on one hand or supervisory and
rank-and-file on the other. The respondents’
pleadings do not show the distinctions in
functions and responsibilities which differentiate
the managers from the supervisors and sets apart
the rank-and-file from either the managerial or
supervisory groups. As a matter of fact, the
formation of a supervisor’s union was never
before the Labor Arbiter and the Bureau of
Labor Relations and neither is the issue before
us. We, therefore, abide by the public
respondent’s factual findings in the absence of a
showing of grave abuse of discretion.
In the case at bar, there is no dispute that the
petitioner is the exclusive bargaining
representative of the rank-and-file employees of
Triumph International. A careful examination of
the records of this case reveals no evidence that
rules out the commonality of interests among the
rank-and-file members of the petitioner and the
herein declared rank-and-file employees who are
members of the respondent union. Instead of
forming another bargaining unit, the law
requires them to be members of the existing one.
The ends of unionism are better served if all the
rank-and-file employees with substantially the
same interests and who invoke their right to self-
organization are part of a single unit so that they
can deal with their employer with just one and
yet potent voice. The employees’ bargaining
power with management is strengthened
thereby. Hence, the circumstances of this case
impel us to disallow the holding of a
certification election among the workers sought
to be represented by the respondent union for
want of proof that the right of said workers to
self-organization is being suppressed.
Once again we enunciate that the proliferation of
unions in an employer unit is discouraged as a
matter of policy unless compelling reasons exist
which deny a certain and distinct class of
employees the right to self-organization for
purposes of collective bargaining.
Anent the correlative issue of whether or not the
contract-bar rule applies to the present case,
Rule V, Section 3, Book V of the Implementing
Rules and Regulations of the Labor Code is
written in plain and simple terms. It provides in
effect that if a collective bargaining agreement
validly exists, a petition for certification election
can only be entertained within sixty (60) days
prior to the expiry date of said agreement.
Respondent union's petition for certification
election was filed on November 25, 1987. At the
time of the filing of the said petition, a valid and
existing CBA was present between petitioner
and Triumph International. The CBA was
effective up to September 24, 1989. There is no
doubt that the respondent union's CBA
constituted a bar to the holding of the
certification election as petitioned by the
respondent union with public respondent.
Coastal Subic Bay Terminal vs. DOLE (2006)
In the instant case, the national federations that
exist as separate entities to which the rank-and-
file and supervisory unions are separately
affiliated with do have a common set of officers.
In addition, APSOTEU, the supervisory
federation, actively participates in the CSBTI-
SU while ALU, the rank-and-file federation,
actively participates in the CSBTI-RFU, giving
occasion to possible conflicts of interest among
the common officers of the federation of rank-
and-file and the federation of supervisory
unions. For as long as they are affiliated with
the APSOTEU and ALU, the supervisory and
rank-and-file unions both do not meet the
criteria to attain the status of legitimate labor
organizations, and thus could not separately
petition for certification elections.
FACTS: Private respondents Coastal Subic Bay
Terminal, Inc. Rank-and-File Union (CSBTI-
RFU) and Coastal Subic Bay Terminal, Inc.
Supervisory Union (CSBTI-SU) filed separate
petitions for certification election before Med-
Arbiter Eladio de Jesus of the Regional Office
No. III. The rank-and-file union insists that it is
a legitimate labor organization having been
issued a charter certificate by the Associated
Labor Union (ALU), and the supervisory union
by the Associated Professional, Supervisory,
Office and Technical Employees Union
(APSOTEU).
The petitioner-company claims that the two
unions are not legitimate organizations. The
opposition was acted on favorably by the Med
Arbiter, who did not rule on the legitimacy but
dismissed the petitions of the respondents on the
ground that the APSOTEU and ALU are one
and the same and thus the two unions were
affiliated with one and the same federation. ·
The SOLE reversed the rulings of the med
arbiter. He declared that they are separate and
distinct labor unions having secured separate
certifications of registration from the DOLE. A
certification election was ordered. This was
affirmed by the CA.
ISSUES:
1) What is the Status of APOSTEU?
2) WON the Secretary’s decision based on stare
decisis is correct?
3) WON supervisory and rank-and-file unions
can file separate petitions for certificate election
and WON private respondents are guilty of
commingling?
RULING:
1) Legitimate labor organization.
Petitioner argues that APSOTEU improperly
secured its registration from the DOLE Regional
Director and not from the BLR; that it is the
BLR that is authorized to process applications
and issue certificates of registration in
accordance with our ruling in Phil. Association
of Free Labor Unions v. Secretary of Labor;
that the certificates of registration issued by the
DOLE Regional Director pursuant to the rules
are questionable, and possibly even void ab
initio for being ultra vires; and that the Court of
Appeals erred when it ruled that the law
applicable at the time of APSOTEU’s
registration was the 1989 Revised Implementing
Rules and Regulations of Rep. Act No. 6715.
Petitioner insists that APSOTEU lacks legal
personality, and its chartered affiliate CSBTI-SU
cannot attain the status of a legitimate labor
organization to file a petition for certification
election. It relies on Villar v. Inciong, where we
held therein that Amigo Employees Union was
not a duly registered independent union absent
any record of its registration with the Bureau.
The DOLE issued Department Order No. 40-03,
which took effect on March 15, 2003, further
amending Book V of the above implementing
rules. The new implementing rules explicitly
provide that applications for registration of labor
organizations shall be filed either with the
Regional Office or with the BLR.
Even after the amendments, the rules did not
divest the Regional Office and the BLR of their
jurisdiction over applications for registration by
labor organizations. The amendments to the
implementing rules merely specified that when
the application was filed with the Regional
Office, the application would be acted upon by
the BLR.
The records in this case showed that APSOTEU
was registered on March 1, 1991. Accordingly,
the law applicable at that time was Section 2,
Rule II, Book V of the Implementing Rules4, and
not Department Order No. 95 which took effect
only on June 21, 1997. Thus, considering further
that APSOTEU’s principal office is located in
Diliman, Quezon City, and its registration was
filed with the NCR Regional Office, the
certificate of registration is valid.
4
Rule II Book V, Section 2. Where to file application;
procedure – Any national labor organization or labor
federation or local union may file an application for
registration with the Bureau or the Regional Office where
the applicant’s principal offices is located. The Bureau or
the Regional Office shall immediately process and approve
or deny the application. In case of approval, the Bureau or
the Regional Office shall issue the registration certificate
within thirty (30) calendar days from receipt of the
application, together with all the requirements for
registration as hereinafter provided.
5
Section 1, Rule III of Book V, as amended by Department
Order No. 9, thus:
SECTION 1. Where to file applications. – The application
for registration of any federation, national or industry union
or trade union center shall be filed with the Bureau. Where
the application is filed with the Regional Office, the same
shall be immediately forwarded to the Bureau within forty-
eight (48) hours from filing thereof, together with all the
documents supporting the registration.
The applications for registration of an independent union
shall be filed with and acted upon by the Regional Office
where the applicant’s principal office is located…
The petitioner misapplied Villar v. Inciong. In
said case, there was no record in the BLR that
Amigo Employees Union was registered.
2) Yes, it is correct.
Section 5, Rule V, Book V of the Implementing
Rules states:
Section 5. Effect of registration – The labor
organization or workers’ association shall be
deemed registered and vested with legal
personality on the date of issuance of its
certificate of registration. Such legal personality
cannot thereafter be subject to collateral attack,
but maybe questioned only in an independent
petition for cancellation in accordance with
these Rules.
Thus, APSOTEU is a legitimate labor
organization and has authority to issue charter to
its affiliates. It may issue a local charter
certificate to CSBTI-SU and correspondingly,
CSBTI-SU is legitimate.
3) No. They cannot file separate petitions. Yes,
they are guilty of commingling.
A word of caution though, under Article 245 of
the Labor Code, supervisory employees are not
eligible for membership in a labor union of rank-
and-file employees. The supervisory employees
are allowed to form their own union but they are
not allowed to join the rank-and-file union
because of potential conflicts of interest.
Further, to avoid a situation where supervisors
would merge with the rank-and-file or where the
supervisors’ labor union would represent
conflicting interests, a local supervisors’ union
should not be allowed to affiliate with the
national federation of unions of rank-and-file
employees where that federation actively
participates in the union activity within the
company. Thus, the limitation is not confined to
a case of supervisors wanting to join a rank-and-
file union. The prohibition extends to a
supervisors’ local union applying for
membership in a national federation the
members of which include local unions of rank-
and-file employees. In De La Salle University
Medical Center and College of Medicine v.
Laguesma, we reiterated the rule that for the
prohibition to apply, it is not enough that the
supervisory union and the rank-and-file union
are affiliated with a single federation. In
addition, the supervisors must have direct
authority over the rank-and-file employees.
In the instant case, the national federations that
exist as separate entities to which the rank-and-
file and supervisory unions are separately
affiliated with do have a common set of officers.
In addition, APSOTEU, the supervisory
federation, actively participates in the CSBTI-
SU while ALU, the rank-and-file federation,
actively participates in the CSBTI-RFU, giving
occasion to possible conflicts of interest among
the common officers of the federation of rank-
and-file and the federation of supervisory
unions. For as long as they are affiliated with the
APSOTEU and ALU, the supervisory and rank-
and-file unions both do not meet the criteria to
attain the status of legitimate labor
organizations, and thus could not separately
petition for certification elections.
The purpose of affiliation of the local unions
into a common enterprise is to increase the
collective bargaining power in respect of the
terms and conditions of labor. When there is
commingling of officers of a rank-and-file union
with a supervisory union, the constitutional
policy on labor is circumvented. Labor
organizations should ensure the freedom of
employees to organize themselves for the
purpose of leveling the bargaining process but
also to ensure the freedom of workingmen and
to keep open the corridor of opportunity to
enable them to do it for themselves.
UP vs. FERRER-CALLEJA (1992)
On the contrary, the dichotomy of interests, the
dissimilarity in the nature of the work and duties
as well as in the compensation and working
conditions of the academic and non-academic
personnel dictate the separation of these two
categories of employees for purposes of
collective bargaining. The formation of two
separate bargaining units, the first consisting of
the rank-and-file non-academic personnel, and
the second, of the rank-and-file academic
employees, is the set-up that will best assure to
all the employees the exercise of their collective
bargaining rights. These special circumstances,
i.e., the dichotomy of interests and concerns as
well as the dissimilarity in the nature and
conditions of work, wages and compensation
between the academic and non-academic
personnel, bring the case at bar within the
exception contemplated in Section 9 of
Executive Order No. 180.
FACTS: The case was initiated in the Bureau of
Labor Relations by a petition filed on March 2,
1990 by a registered labor union, the
"Organization of Non-Academic Personnel of
UP" (ONAPUP). Claiming to have a
membership of 3,236 members — comprising
more than 33% of the 9,617 persons constituting
the non-academic personnel of UP-Diliman, Los
Baños, Manila, and Visayas, it sought the
holding of a certification election among all said
non-academic employees of the University of
the Philippines. At a conference thereafter held
on March 22, 1990 in the Bureau, the University
stated that it had no objection to the election.
On April 18, 1990, another registered labor
union, the "All UP Workers' Union," filed a
comment, as intervenor in the certification
election proceeding. Alleging that its
membership covers both academic and non-
academic personnel, and that it aims to unite all
UP rank-and-file employees in one union, it
declared its assent to the holding of the election
provided the appropriate organizational unit was
first clearly defined. It observed in this
connection that the Research, Extension and
Professional Staff (REPS), who are academic
non-teaching personnel, should not be deemed
part of the organizational unit. For its part, the
University, through its General Counsel, made
of record its view that there should be two (2)
unions: one for academic, the other for non-
academic or administrative, personnel
considering the dichotomy of interests,
conditions and rules governing these employee
groups.
Director Calleja ruled on the matter on August
7, 1990. She declared that "the appropriate
organizational unit should embrace all the
regular rank-and-file employees, teaching and
non-teaching, of the University of the
Philippines, including all its branches" and that
there was no sufficient evidence "to justify the
grouping of the non-academic or administrative
personnel into an organization unit apart and
distinct from that of the academic or teaching
personnel." Director Calleja adverted to Section
9 of Executive Order No. 180.
The Director thus commanded that a
certification election be "conducted among rank-
and-file employees, teaching and non-teaching"
in all four autonomous campuses of the UP, and
that management appear and bring copies of the
corresponding payrolls for January, June, and
July, 1990 at the "usual pre-election conference”
At the pre-election conference held on March
22, 1990 at the Labor Organizational Division of
the DOLE, 8 the University sought further
clarification of the coverage of the term, "rank-
and-file" personnel, asserting that not every
employee could properly be embraced within
both teaching and non-teaching categories since
there are those whose positions are in truth
managerial and policy-determining, and hence,
excluded by law.
At a subsequent hearing (on October 4, 1990),
the University filed a Manifestation seeking the
exclusion from the organizational unit of those
employees holding supervisory positions among
non-academic personnel, and those in teaching
staff with the rank of Assistant Professor or
higher, submitting the following as grounds
therefor: 1) Certain "high-level employees" with
policy-making, managerial, or confidential
functions, are ineligible to join rank-and-file
employee organizations under Section 3, EO
180: Sec. 3. High-level employees whose
functions are normally considered as policy-
making or managerial or whose duties are of a
highly confidential nature shall not be eligible to
join the organization of rank-and file
government employees; 2) In the University
hierarchy, not all teaching and non-teaching
personnel belong the rank-and file: just as there
are those occupying managerial positions within
the non-teaching roster, there is also a
dichotomy between various levels of the
teaching or academic staff; 3) Among the non-
teaching employees composed of Administrative
Staff and Research personnel, only those
holding positions below Grade 18 should be
regarded as rank-and-file, considering that those
holding higher grade positions, like Chiefs of
Sections, perform supervisory functions
including that of effectively recommending
termination of appointments or initiating
appointments and promotions; and 4) Not all
teaching personnel may be deemed included in
the term, "rank-and-file;" only those holding
appointments at the instructor level may be so
considered, because those holding appointments
from Assistant Professor to Associate Professor
to full Professor take part, as members of the
University Council, a policy-making body, in
the initiation of policies and rules with respect to
faculty tenure and promotion.
The ONAPUP quite categorically made of
record its position; that it was not opposing the
University's proferred classification of rank-and
file employees. On the other hand, the "All UP
Workers' Union" opposed the University's view,
in a Position Paper presented by it under date of
October 18, 1990. Director Calleja subsequently
promulgated an Order dated October 30, 1990,
resolving the "sole issue" of "whether or not
professors, associate professors and assistant
professors are included in the definition of high-
level employee(s)" in light of Rule I, Section (1)
of the Implementing Guidelines of Executive
Order No. 1806, defining "high level employee".
The Director adjudged that said teachers are
rank-and-file employees "qualified to join
unions and vote in certification elections
According to her —
A careful perusal of the University Code shows
that the policy-making powers of the Council
are limited to academic matters, namely,
prescribing courses of study and rules of
discipline, fixing student admission and
graduation requirements, recommending to the
Board of Regents the conferment of degrees,
and disciplinary power over students. The
policy-determining functions contemplated in
the definition of a high-level employee pertain to
managerial, executive, or organization policies,
such as hiring, firing, and disciplining of
employees, salaries, teaching/working hours,
other monetary and non-monetary benefits, and
other terms and conditions of employment. They
are the usual issues in collective bargaining
negotiations so that whoever wields these
powers would be placed in a situation of
conflicting interests if he were allowed to join
the union of rank-and-file employees.
6
Rule 1, Sec. 1 of EO No. 180 - 1. High Level Employee
— is one whose functions are normally considered policy
determining, managerial or one whose duties are highly
confidential in nature.
A managerial function refers to the exercise of powers such
as:
1. To effectively recommend such managerial actions;
2. To formulate or execute management policies and
decisions; or
3. To hire, transfer, suspend, lay-off, recall, dismiss, assign
or discipline employees."
The University seasonably moved for
reconsideration, seeking to make the following
points, to wit:
1) UP professors do "wield the most potent
managerial powers: the power to rule on tenure,
on the creation of new programs and new jobs,
and conversely, the abolition of old programs
and the attendant re-assignment of employees.
2) To say that the Council is "limited to (acting
on) academic matters" is error, since academic
decisions "are the most important decisions
made in a University (being, as it were) the
heart, the core of the University as a workplace.
3) Considering that the law regards as a "high
level" employee, one who performs either
policy-determining, managerial, or confidential
functions, the Director erred in applying only the
"managerial functions" test, ignoring the
"policy-determining functions" test.
4) The Director's interpretation of the law would
lead to absurd results, e.g.: "an administrative
officer of the College of Law is a high level
employee, while a full Professor who has
published several treatises and who has
distinguished himself in argument before the
Supreme Court is a mere rank-and-file
employee. A dormitory manager is classified as
a high level employee, while a full Professor or
Political Science with a Ph. D. and several
Honorary doctorates is classified as rank-and-
file."
ISSUE: WON they, and other employees
performing academic functions, should comprise
a collective bargaining unit distinct and different
from that consisting of the non-academic
employees of the University, considering the
dichotomy of interests, conditions and rules
existing between them.
RULING: Yes.
The Supreme Court applied the principles laid
down in Democratic Labor Association vs.
Cebu Stevedoring Company, Inc ( 103 Phil.
1103). In the said case, the Supreme Court said
that there are various factors which must be
satisfied and considered in determining the
proper constituency of a bargaining unit. No one
particular factor is itself decisive of the
determination. The weight accorded to any
particular factor varies in accordance with the
particular question or questions that may arise in
a given case. What are these factors?
Rothenberg mentions a good number, but the
most pertinent to our case are: (1) will of the
employees (Globe Doctrine); (2) affinity and
unit of employees' interest, such as substantial
similarity of work and duties, or similarity of
compensation and working conditions; (3) prior
collective bargaining history; and (4)
employment status, such as temporary, seasonal
probationary employees.
The Court further explained that "the test of the
grouping is community or mutuality of interests.
And this is so because 'the basic test of an
asserted bargaining unit's acceptability is
whether or not it is fundamentally the
combination which will best assure to all
employees the exercise of their collective
bargaining rights' (Rothenberg on Labor
Relations, 490)." Hence, in that case, the Court
upheld the trial court's conclusion that two
separate bargaining units should be formed, one
consisting of regular and permanent employees
and another consisting of casual laborers or
stevedores.
In the case at bar, the University employees
may, as already suggested, quite easily be
categorized into two general classes: one, the
group composed of employees whose functions
are non-academic, i.e., janitors, messengers,
typists, clerks, receptionists, carpenters,
electricians, grounds-keepers, chauffeurs,
mechanics, plumbers; and two, the group made
up of those performing academic functions, i.e.,
full professors, associate professors, assistant
professors, instructors — who may be judges or
government executives — and research,
extension and professorial staff. Not much
reflection is needed to perceive that the
community or mutuality of interests which
justifies the formation of a single collective
bargaining unit is wanting between the academic
and non-academic personnel of the university. It
would seem obvious that teachers would find
very little in common with the University clerks
and other non-academic employees as regards
responsibilities and functions, working
conditions, compensation rates, social life and
interests, skills and intellectual pursuits, cultural
activities, etc. On the contrary, the dichotomy of
interests, the dissimilarity in the nature of the
work and duties as well as in the compensation
and working conditions of the academic and
non-academic personnel dictate the separation of
these two categories of employees for purposes
of collective bargaining. The formation of two
separate bargaining units, the first consisting of
the rank-and-file non-academic personnel, and
the second, of the rank-and-file academic
employees, is the set-up that will best assure to
all the employees the exercise of their collective
bargaining rights. These special circumstances,
i.e., the dichotomy of interests and concerns as
well as the dissimilarity in the nature and
conditions of work, wages and compensation
between the academic and non-academic
personnel, bring the case at bar within the
exception contemplated in Section 9 of
Executive Order No. 180. It was grave abuse of
discretion on the part of the Labor Relations
Director to have ruled otherwise, ignoring plain
and patent realities.
The Order of August 7, 1990 is MODIFIED in
the sense that the non-academic rank-and-file
employees of the University of the Philippines
shall constitute a bargaining unit to the
exclusion of the academic employees of the
institution — i.e., full professors, associate
professors, assistant professors, instructors, and
the research, extension and professorial staff,
who may, if so minded, organize themselves
into a separate collective bargaining unit; and
that, therefore, only said non-academic rank-
and-file personnel of the University of the
Philippines in Diliman, Manila, Los Baños and
the Visayas are to participate in the certification
election.
Baker vs. Trajano (1988)
The test of "supervisory" or managerial status"
depends on whether a person possesses
authority to act in the interest of his employer in
the matter specified in Art. 212(k) of the Labor
Code and Sec. 1(m) of its Implementing Rules
and whether such authority is not merely
routinary or clerical in nature, but requires the
use of independent judgment.
FACTS: This is a petition for certiorari seeking
the annulment of the order of Mediator-Arbiter
Conchita Martinez of Ministry of Labor and
Employment and Dir Cresencio Trajano of
MOLE. On April 23, 1984 Franklin Baker
Brotherhood Association filed a petition for
certification election among the office and
technical employees of the petitioner company
with the Ministry of Labor and Employment
Davao. It alleges that 90 employees in the Davao
plant which is distinct from the regular rank and
file employees is excluded from the coverage of
the existing CBA. Petitioner Company did not
object on the election but manifested that out of
90 employees 74 are managerial employees and
2 are confidential employees.
Med-Arbiter Martinez issued an order dated
Sept. 17, 1984 granting the petition and
certification election among the office and
technical employees of the Davao plant. The
petitioner company appealed to the Bureau of
Labor Relations for the order to be set aside and
declare the 74 employees as managerial
employees. During the pendency of the appeal,
61 employees involved filed a Motion to
Withdraw the petition for certification election
praying for their exclusion from the bargaining
unit because they are managerial employees as
they are performing managerial functions. April
7, 1986 Cresencio Trajano of Bureau of Labor
Relations issued a resolution affirming the order
of Med-Arbiter Conchita Martinez.
ISSUE: WON the subject employees are
managerial employees under the purview of the
Labor Code and its Implementing Rules.
RULING: No.
A managerial employee is defined as one "who
is vested with powers or prerogative to lay down
and execute management policies and/or to hire,
transfer, suspend, layoff, recall, discharge,
assign, or discipline employees or to effectively
recommend such managerial actions."
It will be noted that in the performance of their
duties and functions and in the exercise of their
recommendatory powers, subject employees
may only recommend, as the ultimate power to
hire, fire or suspend as the case maybe rests
upon the plant manager. The test of
"supervisory" or managerial status" depends on
whether a person possesses authority to act in
the interest of his employer in the matter
specified in Art. 212(k) of the Labor Code and
Sec. 1(m) of its Implementing Rules and
whether such authority is not merely routinary
or clerical in nature, but requires the use of
independent judgement. The subject employees
are not managerial employees because as borne
by the records, they do not participate in the
policy making but given ready policies to
execute and standard practice to observe, thus
having little freedom of action.
Premises Considered, the petition is dismissed,
and the assailed resolution and orders are
Affirmed. So Ordered
SAN MIGUEL CORPORATION
SUPERVISORS AND EXEMPT UNION
AND ERNESTO L. PONCE, President V.
HONORABLE BIENVENIDO E.
LAGUESMA IN HIS CAPACITY AS
UNDERSECRETARY OF LABOR AND
EMPLOYMENT, HONORABLE DANILO
L. REYNANTE IN HIS CAPACITY AS
MED-ARBITER AND SAN MIGUEL
CORPORATION
An important element of the “confidential
employee rule” is the employee’s need to use
labor relations information.
The fact that the three plants are located in
three different places is immaterial.
Geographical location can be completely
disregarded if the communal or mutual interests
of the employees are not sacrificed.
FACTS: Petitioner union filed before DOLE a
Petition for Direct Certification or Certification
Election among the supervisors and exempt
employees of the SMC Magnolia Poultry
Products Plants of Cabuyao, San Fernando and
Otis.
Med-Arbiter Danilo L. Reynante issued an
Order ordering the conduct of certification
election among the abovementioned employees
of the different plants as one bargaining unit.
San Miguel Corporation filed a Notice of
Appeal with Memorandum on Appeal, pointing
out, among others, the Med-Arbiter’s error in
grouping together all three (3) separate plants,
into one bargaining unit, and in including
supervisory levels 3 and above whose positions
are confidential in nature.
The public respondent, Undersecretary
Laguesma, granted respondent company’s
Appeal and ordered the remand of the case to the
Med-Arbiter of origin for determination of the
true classification of each of the employees
sought to be included in the appropriate
bargaining unit.
Upon petitioner-union’s motion, Undersecretary
Laguesma granted the reconsideration prayed for
and directed the conduct of separate certification
elections among the supervisors ranked as
supervisory levels 1 to 4 (S1 to S4) and the
exempt employees in each of the three plants at
Cabuyao, San Fernando and Otis.
ISSUE:
1) WON Supervisory employees 3 and 4 and the
exempt employees of the company are
considered confidential employees, hence
ineligible from joining a union?
2) If they are not confidential employees, do the
employees of the three plants constitute an
appropriate single bargaining unit?
RULING:
1) No.
On the first issue, this Court rules that said
employees do not fall within the term
“confidential employees” who may be
prohibited from joining a union. There is no
question that the said employees, supervisors
and the exempt employees, are not vested with
the powers and prerogatives to lay down and
execute management policies and/or to hire,
transfer, suspend, layoff, recall, discharge or
dismiss employees. They are, therefore, not
qualified to be classified as managerial
employees who, under Article 245[4] of the
Labor Code, are not eligible to join, assist or
form any labor organization. In the very same
provision, they are not allowed membership in a
labor organization of the rank-and-file
employees but may join, assist or form separate
labor organizations of their own.
The only question that need be addressed is
whether these employees are properly classified
as confidential employees or not. Confidential
employees are those who (1) assist or act in a
confidential capacity, (2) to persons who
formulate, determine, and effectuate
management policies in the field of labor
relations. The two criteria are cumulative, and
both must be met if an employee is to be
considered a confidential employee – that is, the
confidential relationship must exist between the
employees and his supervisor, and the
supervisor must handle the prescribed
responsibilities relating to labor relations.
The broad rationale behind this rule is that
employees should not be placed in a position
involving a potential conflict of interests.
There have been ample precedents in this regard,
thus in Bulletin Publishing Company v. Hon.
Augusto Sanchez, the Court held that “if these
managerial employees would belong to or be
affiliated with a Union, the latter might not be
assured of their loyalty to the Union in view of
evident conflict of interest. The Union can also
become company-dominated with the presence
of managerial employees in Union
membership.”
An important element of the “confidential
employee rule” is the employee’s need to use
labor relations information.
It is the contention of respondent corporation
that Supervisory employees 3 and 4 and the
exempt employees come within the meaning of
the term “confidential employees” primarily
because they answered in the affirmative when
asked “Do you handle confidential data or
documents?” in the Position Questionnaires
submitted by the Union. In the same
questionnaire, however, it was also stated that
the confidential information handled by
questioned employees relate to product
formulation, product standards and product
specification which by no means relate to “labor
relations.” As held in Westinghouse Electric
Corporation v. National Labor Relations
Board, “an employee may not be excluded from
appropriate bargaining unit merely because he
has access to confidential information
concerning employer’s internal business
operations and which is not related to the field
of labor relations.”
It must be borne in mind that Section 3 of
Article XIII of the 1987 Constitution mandates
the State to guarantee to “all” workers the right
to self-organization. Hence, confidential
employees who may be excluded from
bargaining unit must be strictly defined so as not
to needlessly deprive many employees of their
right bargain collectively through
representatives of their choosing.
In the case at bar, supervisors 3 and above may
not be considered confidential employees merely
because the information they handle are properly
classifiable as technical and internal business
operations data which, to our mind, has no
relevance to negotiations and settlement of
grievances wherein the interests of a union and
the management are invariably adversarial.
Furthermore, even assuming that they are
confidential employees, jurisprudence has
established that there is no legal prohibition
against confidential employees who are not
performing managerial functions to form and
join a union.
2) Yes.
It is the contention of the petitioner union that
the creation of three (3) separate bargaining
units, one each for Cabuyao Otis and San
Fernando as ruled by the respondent
Undersecretary, is contrary to the one-company,
one-union policy.
It adds that Supervisors level 1 to 4 and exempt
employees of the three plants have a similarity
or a community of interests.
This Court finds the contention of the petitioner
meritorious.
A unit to be appropriate must effect a grouping
of employees who have substantial, mutual
interests in wages, hours, working conditions
and other subjects of collective bargaining. It is
readily seen that the employees in the instant
case have “community or mutuality of
interest,” which is the standard in determining
the proper constituency of a collective
bargaining unit. It is undisputed that they all
belong to the Magnolia Poultry Division of San
Miguel Corporation. This means that, although
they belong to three different plants, they
perform work of the same nature, receive the
same wages and compensation, and most
importantly, share a common stake in
concerted activities. The fact that the three
plants are located in three different places is
immaterial. Geographical location can be
completely disregarded if the communal or
mutual interests of the employees are not
sacrificed.
WHEREFORE, the assailed Order of March 11,
1993 is hereby SET ASIDE and the Order of the
Med-Arbiter on December 19, 1990 is
REINSTATED under which a certification
election among the supervisors (level 1 to 4) and
exempt employees of the San Miguel
Corporation Magnolia Poultry Products Plants
of Cabuyao, San Fernando, and Otis as one
bargaining unit is ordered conducted. SO
ORDERED
Sugbuanon Rural Bank Inc. vs. Laguesma
(2000)
When the employee does not have access to
confidential labor relations information, there is
no legal prohibition against confidential
employees from forming, assisting, or joining a
union
FACTS: Petitioner is a duly-registered banking
institution in Cebu, while private respondent
APSOTEU-TUCP was a labor organization
duly-registered with the Labor Department.
APSOTEU filed a petition for certification
election of the 5 supervisory employees. SRBI
filed a motion to dismiss the union's petition on
two grounds. First, that the members of union
were in fact managerial or confidential
employees and were to be disqualified from
forming or joining unions. Second, the
Association of Labor Unions-TUCP was
representing the union. Since ALU-TUCP also
sought to represent the rank-and-file employees
of SRBI, there was a violation of the principle of
separation of unions. The union argued that its
members were not managerial employees but
merely supervisory employees. Med-Arbiter:
denied petitioner's motion to dismiss. Secretary
of Labor and Employment: same was denied.
DOLE Undersecretary: denied SRBI's appeal.
ISSUE: WON the members of the respondent
union are managerial/confidential employees,
hence prohibited by law from joining labor
organizations and engaging in union activities?
RULING: No.
The petitioner bank failed to show that their
Cashiers, Accountant, and Acting Chief of the
Loans Department possessed managerial powers
and duties. At best, they only had
recommendatory powers subject to evaluation,
review, and final decision by the bank's
management. The job description forms
submitted by petitioner clearly show that the
union members in question may not transfer,
suspend, lay-off, recall, discharge, assign, or
discipline employees. Moreover, the forms also
do not indicate that said officers could formulate
and execute management policies which are
normally expected of management officers.
Neither could the union members be treated as
confidential employees. Although the cashier
serves the bank's management, it could not be
deemed to have access to confidential
information specifically relating to SRBI's labor
relations policies.
As regards the issue on the violation of the
principle of separation of unions, records show
that respondent union was initially assisted by
ALU during its preliminary stages. A local
union maintains its separate personality despite
affiliation with a larger national federation.
APSOTEU-TUCP had separate legal personality
from ALU and TUCP. The law frowns on a
union where the membership is composed of
both supervisors and rank-and-file employees,
for fear that conflicts of interest may arise in the
areas of discipline, collective bargaining, and
strikes. However, in the present case, none of the
members of the respondent union came from the
rank-and-file employees of the bank.
The petition for certification election was filed
by APSOTEU-TUCP, a legitimate labor
organization. True, it was assisted to some
extent by ALU and the national federation
TUCP. However, APSOTEU-TUCP had
separate legal personality from ALU and TUCP,
under the principle that a local union maintains
its separate legal personality despite affiliation
with a national federation. Hence, the petition
for certificate election should be granted.
Tunay na Pagkakaisa ng Manggagawa sa
Asia Brewery vs. Asia Brewery (2010)
Although Article 245 of the Labor Code limits
the ineligibility to join, form and assist any
labor organization to managerial employees,
jurisprudence has extended this prohibition to
confidential employees or those who by reason
of their positions or nature of work are required
to assist or act in a fiduciary manner to
managerial employees and hence, are likewise
privy to sensitive and highly confidential
records. Confidential employees are thus
excluded from the rank-and-file bargaining unit.
FACTS: Respondent ABI entered into a CBA
with Bisig at Lakas ng mga Manggagawa sa
Asia-Independent (BLMA-INDEPENDENT),
the exclusive bargaining representative of ABI’s
rank-and-file employees.
Article I of the CBA defined the scope of the
bargaining unit, as follows: The UNION shall
not represent or accept for membership
employees outside the scope of the bargaining
unit herein defined:
Section 2. Bargaining Unit. The bargaining unit
shall be comprised of all regular rank-and-file
daily-paid employees of the COMPANY.
However, the following jobs/positions as herein
defined shall be excluded from the bargaining
unit, to wit:
xxx
Confidential and Executive Secretaries
xxx
Purchasing and Quality Control Staff.
The CBA expressly excluded Confidential and
Executive Secretaries from the rank-and-file
bargaining unit, for which reason ABI seeks
their disaffiliation from petitioner. ABI’s
management stopped deducting union dues from
81 employees, believing that their membership
in BLMA-INDEPENDENT violated the CBA.
18 of these affected employees are QA Sampling
Inspectors/Inspectresses and Machine Gauge
Technician (checkers) who formed part of the
Quality Control Staff. The rest are
secretaries/clerks directly under their respective
division managers.
Petitioner, however, maintains that except for
those who had been promoted to monthly paid
positions, the other secretaries/clerks are deemed
included among the rank-and-file employees of
ABI. BLMA-INDEPENDENT claimed that
ABI’s actions restrained the employees’ right to
self-organization.
VA ruled that the subject employees qualify
under the rank-and-file category because their
functions are merely routinary and clerical. He
noted that the positions occupied by the
checkers and secretaries/clerks in the different
divisions are not managerial or supervisory, as
evident from the duties and responsibilities
assigned to them. With respect to QA Sampling
Inspectors/Inspectresses and Machine Gauge
Technician, he ruled that ABI failed to establish
with sufficient clarity their basic functions as to
consider them Quality Control Staff who were
excluded from the coverage of the CBA.
Accordingly, the subject employees were
declared eligible for inclusion within the
bargaining unit represented by BLMA-
INDEPENDENT.
CA reversed the VA, ruling that the 81
employees are excluded from and are not
eligible for inclusion in the bargaining unit as
defined in Section 2, Article I of the CBA.
ISSUE: WON the checkers and
secretaries/clerks of respondent company are
rank-and-file employees who are eligible to join
the Union of the rank-and-file employees.
RULING: YES. The checkers and
secretaries/clerks of respondent company are
rank-and-file employees who are eligible to join
the Union of the rank-and-file employees.
Although Article 245 of the Labor Code limits
the ineligibility to join, form and assist any labor
organization to managerial employees,
jurisprudence has extended this prohibition to
confidential employees or those who by reason
of their positions or nature of work are required
to assist or act in a fiduciary manner to
managerial employees and hence, are likewise
privy to sensitive and highly confidential
records. Confidential employees are thus
excluded from the rank-and-file bargaining unit.
The rationale for their separate category and
disqualification to join any labor organization is
similar to the inhibition for managerial
employees because if allowed to be affiliated
with a Union, the latter might not be assured of
their loyalty in view of evident conflict of
interests and the Union can also become
company-denominated with the presence of
managerial employees in the Union
membership. Having access to confidential
information, confidential employees may also
become the source of undue advantage. Said
employees may act as a spy or spies of either
party to a collective bargaining agreement.
Confidential employees are defined as those
who:
1) Assist or act in a confidential capacity,
2) To persons who formulate, determine, and
effectuate management policies in the field of
labor relations.
The two (2) criteria are cumulative, and both
must be met if an employee is to be considered a
confidential employee that is, the confidential
relationship must exist between the employee
and his supervisor, and the supervisor must
handle the prescribed responsibilities relating to
labor relations. The exclusion from bargaining
units of employees who, in the normal course of
their duties, become aware of management
policies relating to labor relations is a principal
objective sought to be accomplished by the
confidential employee rule.
A perusal of the job descriptions of these
secretaries/clerks reveals that their assigned
duties and responsibilities involve routine
activities of recording and monitoring, and other
paper works for their respective departments
while secretarial tasks such as receiving
telephone calls and filing of office
correspondence appear to have been commonly
imposed as additional duties. Respondent failed
to indicate who among these numerous
secretaries/clerks have access to confidential
data relating to management policies that could
give rise to potential conflict of interest with
their Union membership. It is not even
farfetched that the job category may exist only
on paper since they are all daily-paid workers.
With respect to the Sampling
Inspectors/Inspectresses and the Gauge Machine
Technician, the job descriptions of these
checkers showed that they perform routine and
mechanical tasks preparatory to the delivery of
the finished products. No evidence was
presented by the respondent to prove that these
daily-paid checkers actually form part of the
company’s Quality Control Staff who as such
were exposed to sensitive, vital and confidential
information about [company’s] products or have
knowledge of mixtures of the products, their
defects, and even their formulas which are
considered trade secrets.
San Miguel Foods Inc. vs. San Miguel
Corporation Supervisors and Exempt Union
(2011)
An appropriate bargaining unit is defined as a
group of employees of a given employer,
comprised of all or less than all of the entire
body of employees, which the collective interest
of all the employees, consistent with equity to
the employer, indicate to be best suited to serve
the reciprocal rights and duties of the parties
under the collective bargaining provisions of the
law.
It held that while the existence of a bargaining
history is a factor that may be reckoned with in
determining the appropriate bargaining unit,
the same is not decisive or conclusive. Other
factors must be considered. The test of grouping
is community or mutuality of interest. This is so
because the basic test of an asserted bargaining
unit’s acceptability is whether or not it is
fundamentally the combination which will best
assure to all employees the exercise of their
collective bargaining rights. Certainly, there is
a mutuality of interest among the employees.
Their functions mesh with one another. One
group needs the other in the same way that the
company needs them both. There may be
differences as to the nature of their individual
assignments, but the distinctions are not enough
to warrant the formation of a separate
bargaining unit.
FACTS: In the case of San Miguel Corporation
Supervisors and Exempt Union v. Laguesma, the
Court held that even if they handle confidential
data regarding technical and internal business
operations, supervisory employees 3 and 4 and
the exempt employees of petitioner San Miguel
Foods, Inc. are not to be considered confidential
employees, because the same do not pertain to
labor relations, particularly, negotiation and
settlement of grievances. Consequently, they
were allowed to form an appropriate bargaining
unit for the purpose of collective bargaining.
The Court also declared that the employees
belonging to the three different plants of San
Miguel Corporation Magnolia Poultry Products
Plants in Cabuyao, San Fernando, and Otis,
having community or mutuality of interests,
constitute a single bargaining unit.
A certification election was conducted. On the
date of the election, petitioner filed the Omnibus
Objections and Challenge to Voters, questioning
the eligibility to vote by some of its employees
on the grounds that some employees do not
belong to the bargaining unit which respondent
seeks to represent or that there is no existence of
employer-employee relationship with petitioner.
Based on the results of the election, the Med-
Arbiter issued the Order stating that since the
Yes vote received 97% of the valid votes cast,
respondent is certified to be the exclusive
bargaining agent of the supervisors and exempt
employees of petitioner's Magnolia Poultry
Products Plants in Cabuyao, San Fernando, and
Otis.
On appeal, the then Acting DOLE
Undersecretary, in the Resolution, affirmed the
Order of the Med-Arbiter.
CA affirmed the Resolution of DOLE
Undersecretary with modification stating that
those holding the positions of Human Resource
Assistant and Personnel Assistant are excluded
from the bargaining unit.
Hence, this petition by the San Miguel Foods
ISSUE: WON CA departed from jurisprudence
when it expanded the scope of the bargaining
unit?
RULING: No. In San Miguel vs Laguesma,
the Court explained that the employees of San
Miguel Corporation Magnolia Poultry Products
Plants of Cabuyao, San Fernando, and Otis
constitute a single bargaining unit, which is not
contrary to the one-company, one-union policy.
An appropriate bargaining unit is defined as a
group of employees of a given employer,
comprised of all or less than all of the entire
body of employees, which the collective interest
of all the employees, consistent with equity to
the employer, indicate to be best suited to serve
the reciprocal rights and duties of the parties
under the collective bargaining provisions of the
law.
It held that while the existence of a bargaining
history is a factor that may be reckoned with in
determining the appropriate bargaining unit, the
same is not decisive or conclusive. Other factors
must be considered. The test of grouping is
community or mutuality of interest. This is so
because the basic test of an asserted bargaining
unit’s acceptability is whether or not it is
fundamentally the combination which will best
assure to all employees the exercise of their
collective bargaining rights. Certainly, there is a
mutuality of interest among the employees.
Their functions mesh with one another. One
group needs the other in the same way that the
company needs them both. There may be
differences as to the nature of their individual
assignments, but the distinctions are not enough
to warrant the formation of a separate bargaining
unit.
The Court affirms the finding of the CA that
there should be only one bargaining unit for the
employees in Cabuyao, San Fernando, and Otis
of Magnolia Poultry Products Plant involved in
dressed chicken processing and Magnolia
Poultry Farms engaged in live chicken
operations. Certain factors, such as specific line
of work, working conditions, location of work,
mode of compensation, and other relevant
conditions do not affect or impede their
commonality of interest. Although they seem
separate and distinct from each other, the
specific tasks of each division are actually
interrelated and there exists mutuality of
interests which warrants the formation of a
single bargaining unit.
Verceles vs. BLR (2005)
It states that a report of a violation of rights and
conditions of membership in a labor
organization may be made by at least thirty
percent (30%) of all the members of a union or
any member or members specially concerned.
The use of the permissive may in the provision
at once negates the notion that the assent of
30% of all the members is mandatory. More
decisive is the fact that the provision expressly
declares that the report may be made,
alternatively by any member or members
specially concerned. And further confirmation
that the assent of 30% of the union members is
not a factor in the acquisition of jurisdiction by
the Bureau of Labor Relations is furnished by
Article 226 of the same Labor Code, which
grants original and exclusive jurisdiction to the
Bureau, and the Labor Relations Division in the
Regional Offices of the Department of Labor,
over all inter-union and intra-union conflicts,
and all disputes, grievances or problems arising
from or affecting labor management relations,
making no reference whatsoever to any such
30%-support requirement. Indeed, the officials
mentioned are given the power to act on all
inter-union and intra-union conflicts (1) upon
request of either or both parties as well as (2) at
their own initiative.
FACTS: Private respondents Rodel E. Dalupan,
et al are members of the University of the East
Employees’ Association (UEEA). On 15
September 1997, they each received a
Memorandum from the UEEA charging them
with spreading false rumors and creating
disinformation among the members of the said
association. They were given seventy-two hours
from receipt of the Memorandum to submit their
Answer.
Through a collective reply, they denied the
allegations and further sent a letter informing the
officers of UEEA informing them that the
memorandum was vague and without legal
basis. UEEA issued another memorandum
giving the private respondents another seventy-
two hours from receipt within which to properly
reply because the collective reply letter was not
responsive to the first memorandum. Their
failure would be construed as an admission of
the truthfulness and veracity of the charges. The
same was still denied by the respondents.
On 09 October 1997, Ernesto Verceles, in his
capacity as president of the association, through
a Memorandum, informed Rodel Dalupan, et al.,
that their membership in the association has
been suspended and shall take effect
immediately upon receipt thereof.
A result of which, a complaint for illegal
suspension was filed by the private respondents
before the Department of Labor and
Employment, National Capital Region (DOLE-
NCR). The Regional Director of the latter
rendered a decision adverse to the petitioners.
The petitioners appealed to the BLR-DOLE, but
the same and the motion for reconsideration
were denied. When appealed before the Court of
Appeals, said petition was still denied due
course for lack of merit. Hence, the petition is
now elevated to the Supreme Court by way of
petition for review on certiorari.
ISSUES:
1) WON the assent of 30% of the members of
the union is required to confer jurisdiction upon
the BLR or LRD in intra-union conflicts?
2) WON the non-holding of meetings and non-
submission of reports by the petitioners moot
and academic, and whether the decision to hold
meetings and submit reports contradict and
override the sovereign will of the majority?
RULING:
1) No. On the matter concerning the 30%
support requirement needed to report violations
of rights and conditions of union membership, as
found in the last paragraph of Article 241 of the
Labor Code, we likewise cannot sanction the
petitioners. We have already made our
pronouncement in the case of Rodriguez v.
Director, Bureau of Labor Relations that the
30% requirement is not mandatory. In this case,
the Court, speaking through Chief Justice
Andres R. Narvasa, held in part:
The respondent Directors ruling, however, that
the assent of 30% of the union membership,
mentioned in Article 242 of the Labor Code, was
mandatory and essential to the filing of a
complaint for any violation of rights and
conditions of membership in a labor
organization (such as the arbitrary and
oppressive increase of union dues here
complained of), cannot be affirmed and will be
reversed. The very article relied upon militates
against the proposition. It states that a report of
a violation of rights and conditions of
membership in a labor organization may be
made by (a)t least thirty percent (30%) of all the
members of a union or any member or members
specially concerned. The use of the permissive
may in the provision at once negates the notion
that the assent of 30% of all the members is
mandatory. More decisive is the fact that the
provision expressly declares that the report may
be made, alternatively by any member or
members specially concerned. And further
confirmation that the assent of 30% of the union
members is not a factor in the acquisition of
jurisdiction by the Bureau of Labor Relations is
furnished by Article 226 of the same Labor
Code, which grants original and exclusive
jurisdiction to the Bureau, and the Labor
Relations Division in the Regional Offices of the
Department of Labor, over all inter-union and
intra-union conflicts, and all disputes,
grievances or problems arising from or
affecting labor management relations, making
no reference whatsoever to any such 30%-
support requirement. Indeed, the officials
mentioned are given the power to act on all
inter-union and intra-union conflicts (1) upon
request of either or both parties as well as (2) at
their own initiative.
2) No. This issue was precipitated by the Court
of Appeals decision affirming the order of
DOLE Regional Director Maximo B. Lim for
the petitioners to hold a general membership
meeting wherein they make open and available
the union’s/association’s books of accounts and
other documents pertaining to the union funds,
and to regularly conduct special and general
membership meetings in accordance with the
union’s constitution and by-laws.
The passage of General Assembly Resolution
No. 10 dated 10 December 1997 and Resolution
No. 8, Series of 2000, which supposedly cured
the lapses committed by the association’s
officers and reiterated the approval of the
general membership of the acts and collateral
actions of the association’s officers cannot
redeem the petitioners from their predicament.
The obligation to hold meetings and render
financial reports is mandated by UEEA’s
constitution and by-laws. This fact was never
denied by the petitioners. Their eventual
compliance, as what happened in this case, shall
not release them from the obligation to
accomplish these things in the future.
Prompt compliance in rendering financial
reports together with the holding of regular
meetings with the submission of the minutes
thereon with the BLR-DOLE and DOLE-NCR
shall negate any suspicion of dishonesty on the
part of UEEA’s officers. This is not only true
with UEEA, but likewise with other
unions/associations, as this matter is imbued
with public interest. Undeniably, transparency in
the official undertakings of union officers will
bolster genuine trade unionism in the country.
BPI vs. BPI Employees Union Davao Chapter
et. al. (2010) (Absorption of EE’s in cases of
merger)
Human beings are never embraced in the term
“assets and liabilities”. The Corporation Code
does not also mandate the absorption of the
employees of the non-surviving corporation by
the surviving corporation in the case of a
merger.
FACTS: Bangko Sentral ng Pilipinas approved
the Articles of Merger executed by and between
BPI, herein petitioner, and Far East Bank and
Trust Company (FEBTC) and was approved by
the Securities and Exchange Commission. The
Articles of Merger and Plan of Merger did not
contain any specific stipulation with respect to
the employment contracts of existing personnel
of the non-surviving entity which is FEBTC.
Pursuant to the said Article and Plan of Merger,
all the assets and liabilities of FEBTC were
transferred to and absorbed by BPI as the
surviving corporation. FEBTC employees,
including those in its different branches across
the country, were hired by petitioner as its own
employees, with their status and tenure
recognized and salaries and benefits maintained.
ISSUE:
1) WON absorbed Employees are covered by the
Union Shop Clause?
2) WON Employees are ipso jure absorbed in a
merger of two corporations?
RULING:
1) Yes they are covered.
Petitioner argues that the term new employees in
the Union Shop Clause of the CBA is qualified
by the phrases who may hereafter be regularly
employed and after they become regular
employees which led petitioner to conclude that
the new employees referred to in, and
contemplated by, the Union Shop Clause of the
CBA were only those employees who were new
to BPI, on account of having been hired initially
on a temporary or probationary status for
possible regular employment at some future
date. BPI argues that the FEBTC employees
absorbed by BPI cannot be considered as new
employees of BPI for purposes of applying the
Union Shop Clause of the CBA.
We do not agree.
Section 2, Article II of the CBA is silent as to
how one becomes a regular employee of the BPI
for the first time. There is nothing in the said
provision which requires that a new regular
employee first undergo a temporary or
probationary status before being deemed as such
under the union shop clause of the CBA.
Union security is a generic term which is applied
to and comprehends closed shop, union shop,
maintenance of membership or any other form
of agreement which imposes upon employees
the obligation to acquire or retain union
membership as a condition affecting
employment. There is union shop when all new
regular employees are required to join the union
within a certain period for their continued
employment. There is maintenance of
membership shop when employees, who are
union members as of the effective date of the
agreement, or who thereafter become members,
must maintain union membership as a condition
for continued employment until they are
promoted or transferred out of the bargaining
unit or the agreement is terminated. A closed-
shop, on the other hand, may be defined as an
enterprise in which, by agreement between the
employer and his employees or their
representatives, no person may be employed in
any or certain agreed departments of the
enterprise unless he or she is, becomes, and, for
the duration of the agreement, remains a
member in good standing of a union entirely
comprised of or of which the employees in
interest are a part.
In other words, the purpose of a union shop or
other union security arrangement is to guarantee
the continued existence of the union through
enforced membership for the benefit of the
workers.
All employees in the bargaining unit covered by
a Union Shop Clause in their CBA with
management are subject to its terms. However,
under law and jurisprudence, the following
kinds of employees are exempted from its
coverage, namely, employees who at the time
the union shop agreement takes effect are bona
fide members of a religious organization which
prohibits its members from joining labor unions
on religious grounds; employees already in the
service and already members of a union other
than the majority at the time the union shop
agreement took effect; confidential employees
who are excluded from the rank and file
bargaining unit; and employees excluded from
the union shop by express terms of the
agreement.
When certain employees are obliged to join a
particular union as a requisite for continued
employment, as in the case of Union Security
Clauses, this condition is a valid restriction of
the freedom or right not to join any labor
organization because it is in favor of unionism.
This Court, on occasion, has even held that a
union security clause in a CBA is not a
restriction of the right of freedom of association
guaranteed by the Constitution.
Moreover, a closed shop agreement is an
agreement whereby an employer binds himself
to hire only members of the contracting union
who must continue to remain members in good
standing to keep their jobs. It is the most prized
achievement of unionism. It adds membership
and compulsory dues. By holding out to loyal
members a promise of employment in the closed
shop, it wields group solidarity.
Indeed, the situation of the former FEBTC
employees in this case clearly does not fall
within the first three exceptions to the
application of the Union Shop Clause discussed
earlier. No allegation or evidence of religious
exemption or prior membership in another union
or engagement as a confidential employee was
presented by both parties. The sole category
therefore in which petitioner may prove its claim
is the fourth recognized exception or whether the
former FEBTC employees are excluded by the
express terms of the existing CBA between
petitioner and respondent.
To reiterate, petitioner insists that the term new
employees, as the same is used in the Union
Shop Clause of the CBA at issue, refers only to
employees hired by BPI as non-regular
employees who later qualify for regular
employment and become regular employees, and
not those who, as a legal consequence of a
merger, are allegedly automatically deemed
regular employees of BPI. However, the CBA
does not make a distinction as to how a regular
employee attains such a status. Moreover, there
is nothing in the Corporation Law and the
merger agreement mandating the automatic
employment as regular employees by the
surviving corporation in the merger.
It is apparent that petitioner hinges its argument
that the former FEBTC employees were
absorbed by BPI merely as a legal consequence
of a merger based on the characterization by the
Voluntary Arbiter of these absorbed employees
as included in the assets and liabilities of the
dissolved corporation - assets because they help
the Bank in its operation and liabilities because
redundant employees may be terminated and
company benefits will be paid to them, thus
reducing the Banks financial status. Based on
this ratiocination, she ruled that the same are not
new employees of BPI as contemplated by the
CBA at issue, noting that the Certificate of
Filing of the Articles of Merger and Plan of
Merger between FEBTC and BPI stated that x x
x the entire assets and liabilities of FAR
EASTERN BANK & TRUST COMPANY will
be transferred to and absorbed by the BANK OF
THE PHILIPPINE ISLANDS x x x (underlining
supplied). In sum, the Voluntary Arbiter upheld
the reasoning of petitioner that the FEBTC
employees became BPI employees by operation
of law because they are included in the term
assets and liabilities.
2) NO. Human beings are never embraced in the
term “assets and liabilities.” Moreover, BPI’s
absorption of former FEBTC employees was
neither by operation of law nor by legal
consequence of contract. There was no
government regulation or law that compelled the
merger of the two banks or the absorption of the
employees of the dissolved corporation by the
surviving corporation. Had there been such law
or regulation, the absorption of employees of the
non-surviving entities of the merger would have
been mandatory on the surviving corporation. In
the present case, the merger was voluntarily
entered into by both banks presumably for some
mutually acceptable consideration. In fact, the
Corporation Code does not also mandate the
absorption of the employees of the non-
surviving corporation by the surviving
corporation in the case of a merger.
The Court cannot uphold the reasoning that the
general stipulation regarding transfer of FEBTC
assets and liabilities to BPI as set forth in the
Articles of Merger necessarily includes the
transfer of all FEBTC employees into the
employ of BPI and neither BPI nor the FEBTC
employees allegedly could do anything about it.
Even if it is so, it does not follow that the
absorbed employees should not be subject to the
terms and conditions of employment obtaining
in the surviving corporation.
Furthermore, the Court believes that it is
contrary to public policy to declare the former
FEBTC employees as forming part of the assets
or liabilities of FEBTC that were transferred and
absorbed by BPI in the Articles of Merger.
Assets and liabilities, in this instance, should be
deemed to refer only to property rights and
obligations of FEBTC and do not include the
employment contracts of its personnel. A
corporation cannot unilaterally transfer its
employees to another employer like chattel.
Certainly, if BPI as an employer had the right to
choose who to retain among FEBTC’s
employees, FEBTC employees had the
concomitant right to choose not to be absorbed
by BPI. Even though FEBTC employees had no
choice or control over the merger of their
employer with BPI, they had a choice whether or
not they would allow themselves to be absorbed
by BPI. Certainly nothing prevented the
FEBTC’s employees from resigning or retiring
and seeking employment elsewhere instead of
going along with the proposed absorption.
Employment is a personal consensual contract
and absorption by BPI of a former FEBTC
employee without the consent of the employee is
in violation of an individual’s freedom to
contract. It would have been a different matter
if there was an express provision in the articles
of merger that as a condition for the merger, BPI
was being required to assume all the
employment contracts of all existing FEBTC
employees with the conformity of the
employees. In the absence of such a provision
in the articles of merger, then BPI clearly had
the business management decision as to whether
or not employ FEBTC’s employees. FEBTC
employees likewise retained the prerogative to
allow themselves to be absorbed or not;
otherwise, that would be tantamount to
involuntary servitude.
NOTE: However in a MR (in 2011) this
decision was reversed.
In said case the SC ruled that, employees should
be absorbed.
It is more in keeping with the dictates of social
justice and the State policy of according full
protection to labor to deem employment
contracts as automatically assumed by the
surviving corporation in a merger, even in the
absence of an express stipulation in the articles
of merger or the merger plan. In his dissenting
opinion, Justice Brion reasoned that:
To my mind, due consideration of Section 80 of
the Corporation Code, the constitutionally
declared policies on work, labor and
employment, and the specific FEBTC-BPI
situation — i.e., a merger with complete “body
and soul” transfer of all that FEBTC embodied
and possessed and where both participating
banks were willing (albeit by deed, not by their
written agreement) to provide for the affected
human resources by recognizing continuity of
employment — should point this Court to a
declaration that in a complete merger situation
where there is total takeover by one corporation
over another and there is silence in the merger
agreement on what the fate of the human
resource complement shall be, the latter should
not be left in legal limbo and should be properly
provided for, by compelling the surviving entity
to absorb these employees. This is what Section
80 of the Corporation Code commands, as the
surviving corporation has the legal obligation to
assume all the obligations and liabilities of the
merged constituent corporation.
Not to be forgotten is that the affected
employees managed, operated and worked on
the transferred assets and properties as their
means of livelihood; they constituted a basic
component of their corporation during its
existence. In a merger and consolidation
situation, they cannot be treated without
consideration of the applicable constitutional
declarations and directives, or, worse, be simply
disregarded. If they are so treated, it is up to this
Court to read and interpret the law so that they
are treated in accordance with the legal
requirements of mergers and consolidation, read
in light of the social justice, economic and social
provisions of our Constitution. Hence, there is a
need for the surviving corporation to take
responsibility for the affected employees and to
absorb them into its workforce where no
appropriate provision for the merged
corporation’s human resources component is
made in the Merger Plan.
By upholding the automatic assumption of the
non-surviving corporation’s existing
employment contracts by the surviving
corporation in a merger, the Court strengthens
judicial protection of the right to security of
tenure of employees affected by a merger and
avoids confusion regarding the status of their
various benefits which were among the chief
objections of our dissenting colleagues.
However, nothing in this Resolution shall impair
the right of an employer to terminate the
employment of the absorbed employees for a
lawful or authorized cause or the right of such an
employee to resign, retire or otherwise sever his
employment, whether before or after the merger,
subject to existing contractual obligations. In
this manner, Justice Brion’s theory of automatic
assumption may be reconciled with the
majority’s concerns with the successor
employer’s prerogative to choose its employees
and the prohibition against involuntary
servitude.
Notwithstanding this concession, the Court finds
no reason to reverse our previous
pronouncement that the absorbed FEBTC
employees are covered by the Union Shop
Clause.
Victoriano vs. Elizalde (1974)
Section 1 (6) of Article III of the agreements
with the employers; that in spite of any closed
shop agreement, members of said religious sects
cannot be refused employment or dismissed
from their jobs on the sole ground that they are
not members of the collective bargaining union.
It is clear, therefore, that the assailed Act, far
from infringing the constitutional provision on
freedom of association, upholds and reinforces
it. It does not prohibit the members of said
religious sects from affiliating with labor
unions. It still leaves to said members the liberty
and the power to affiliate, or not to affiliate,
with labor unions. If, notwithstanding their
religious beliefs, the members of said religious
sects prefer to sign up with the labor union, they
can do so. If in deference and fealty to their
religious faith, they refuse to sign up, they can
do so; the law does not coerce them to join;
neither does the law prohibit them from joining;
and neither may the employer or labor union
compel them to join. Republic Act No. 3350,
therefore, does not violate the constitutional
provision on freedom of association.
FACTS: Benjamin Victoriano (hereinafter
referred to as Appellee), a member of the
religious sect known as the "Iglesia ni Cristo",
had been in the employ of the Elizalde Rope
Factory Inc. (hereinafter referred to as
Company) since 1958. As such employee, he
was a member of the Elizalde Rope Workers'
Union (hereinafter referred to as Union) which
had with the Company a collective bargaining
agreement containing a closed shop provision
which reads as follows:
"Membership in the Union shall be required as
a condition of employment for all permanent
employees workers covered by this Agreement.”
The collective bargaining agreement expired on
March 3, 1964 but was renewed the following
day, March 4, 1964.
Under Section 4 (a), paragraph 4, of Republic
Act No. 875, prior to its amendment by Republic
Act No. 3350, the employer was not precluded
"from making an agreement with a labor
organization to require as a condition of
employment membership therein, if such labor
organization is the representative of the
employees." On June 18, 1961, however,
Republic Act No. 3350 was enacted, introducing
an amendment to paragraph (4) subsection (a)
of section 4 of Republic Act No. 875, as follows:
. . "but such agreement shall not cover members
of any religious sects which prohibit affiliation
of their members in any such labor
organization”.
Being a member of a religious sect that prohibits
the affiliation of its members with any labor
organization, Appellee presented his resignation
to appellant Union. The management of the
Company in turn notified Appellee and his
counsel that unless the Appellee could achieve a
satisfactory arrangement with the Union, the
Company would be constrained to dismiss him
from the service. This prompted the appellee to
file a motion for injunction to enjoin the
Company and the Union from dismissing him.
In its answer, the Union contended, among
others, that Republic Act No. 3350 infringes on
the fundamental right to form lawful
associations; that "the very phraseology of said
Republic Act 3350, that 'membership in a labor
organization is banned to all those belonging to
such religious sect prohibiting affiliation with
any labor organization’”, "prohibits all the
members of a given religious sect from joining
any labor union if such sect prohibits affiliations
of their members thereto”; and, consequently,
deprives said members of their constitutional
right to form or join lawful associations or
organizations guaranteed by the Bill of Rights,
and thus becomes obnoxious to Article III,
Section 1 (6) of the 1935 Constitution.
ISSUE: WON R.A. No. 3350 violates the
constitutional provision on freedom of
association as it prohibits and bans the members
of religious sects that forbid affiliation of their
members with labor unions from joining labor
unions?
RULING: No. Appellant Union's contention
that Republic Act No. 3350 prohibits and bans
the members of such religious sects that forbid
affiliation of their members with labor unions
from joining labor unions appears nowhere in
the wording of Republic Act No. 3350; neither
can the same be deduced by necessary
implication therefrom. It is not surprising,
therefore, that appellant, having thus misread the
Act, committed the error of contending that said
Act is obnoxious to the constitutional provision
on freedom of association. Both the Constitution
and Republic Act No. 875 recognize freedom of
association. Section 1 (6) of Article III of the
Constitution of 1935, as well as Section 7 of
Article IV of the Constitution of 1973, provide
that the right to form associations or societies for
purposes not contrary to law shall not be
abridged. Section 3 of Republic Act No. 875
provides that employees shall have the right to
self-organization and to form, join or assist labor
organizations of their own choosing for the
purpose of collective bargaining and to engage
in concerted activities for the purpose of
collective bargaining and other mutual aid or
protection. What the Constitution and the
Industrial Peace Act recognize and guarantee is
the "right" to form or join associations.
Notwithstanding the different theories
propounded by the different schools of
jurisprudence regarding the nature and contents
of a "right", it can be safely said that whatever
theory one subscribes to, a right comprehends at
least two broad notions, namely: first, liberty or
freedom, i.e., the absence of legal restraint,
whereby an employee may act for himself
without being prevented by law; and second,
power, whereby an employee may, as he
pleases, join or refrain from joining an
association. It is, therefore, the employee who
should decide for himself whether he should join
or not an association; and should he choose to
join, he himself makes up his mind as to which
association he would join; and every after he has
joined, he still retains the liberty and the power
to leave and cancel his membership with said
organization at any time. It is clear, therefore,
that the right to join a union includes the right to
abstain from joining any union. Inasmuch as
what both the Constitution and the Industrial
Peace Act have recognized, and guaranteed to
the employee, is the "right" to join associations
of his choice, it would be absurd to say that the
law also imposes, in the same breath, upon the
employee the duty to join associations. The law
does not enjoin an employee to sign up with any
association.
The right to refrain from joining labor
organizations recognized by Section 3 of the
Industrial Peace Act is, however, limited. The
legal protection granted to such right to refrain
from joining is withdrawn by operation of law,
where a labor union and an employer have
agreed on a closed shop, by virtue of which the
employer may employ only members of the
collective bargaining union, and the employees
must continue to be members of the union for
the duration of the contract in order to keep their
jobs. Thus Section 4 (a) (4) of the Industrial
Peace Act, before its amendment by Republic
Act No. 3350, provides that although it would be
an unfair labor practice for an employer "to
discriminate in regard to hire or tenure of
employment or any term or condition of
employment to encourage or discourage
membership in any labor organization" the
employer is, however, not precluded "from
making an agreement with a labor organization
to require as a condition of employment
membership therein, if such labor organization
is the representative of the employees". By
virtue, therefore, of a closed shop agreement,
before the enactment of Republic Act No. 3350,
if any person, regardless of his religious beliefs,
wishes to be employed or to keep his
employment, he must become a member of the
collective bargaining union. Hence, the right of
said employee not to join the labor union is
curtailed and withdrawn.
To that all embracing coverage of the closed
shop arrangement, Republic Act No. 3350
introduced an exception, when it added to
Section 4 (a) (4) of the Industrial Peace Act the
following proviso: "but such agreement shall not
cover members of any religious sects which
prohibit affiliation of their members in any such
labor organization". Republic Act No. 3350
merely excludes ipso jure from the application
and coverage of the closed shop agreement the
employees belonging to any religious sects
which prohibit affiliation of their members with
any labor organization. What the exception
provides, therefore, is that members of said
religious sects cannot be compelled or coerced
to join labor unions even when said unions have
closed shop and Republic Act No. 875 recognize
freedom of association. Section 1 (6) of Article
III of the agreements with the employers; that in
spite of any closed shop agreement, members of
said religious sects cannot be refused
employment or dismissed from their jobs on the
sole ground that they are not members of the
collective bargaining union. It is clear, therefore,
that the assailed Act, far from infringing the
constitutional provision on freedom of
association, upholds and reinforces it. It does not
prohibit the members of said religious sects
from affiliating with labor unions. It still leaves
to said members the liberty and the power to
affiliate, or not to affiliate, with labor unions. If,
notwithstanding their religious beliefs, the
members of said religious sects prefer to sign up
with the labor union, they can do so. If in
deference and fealty to their religious faith, they
refuse to sign up, they can do so; the law does
not coerce them to join; neither does the law
prohibit them from joining; and neither may the
employer or labor union compel them to join.
Republic Act No. 3350, therefore, does not
violate the constitutional provision on freedom
of association.
De Lassle vs. Bernardo (2017)
The law does not distinguish between part time
and full time employees. Hence part time
employees are entitled to retirement benefits
provided the requisites are complied with.
FACTS: Bernardo was a part-time professional
lecturer at De La Salle-Araneta University
(DLS-AU). On November 8, 2003, DLS-AU
informed Bernardo through a telephone call that
he could not teach at the school anymore as the
school was implementing the retirement age
limit for its faculty members. As he was already
75 years old, Bernardo had no choice but to
retire. He claimed retirement benefits after 27
years of employment.
However, the petitioner countered that Bernardo
was not entitled to any kind of separation pay or
benefits under DLS-AU's policy and CBA.
Neither was DLS-AU mandated by law to pay
Bernardo retirement benefits.
Assuming arguendo that Bernardo was entitled
to retirement benefits, he should have claimed
the same upon reaching the age of 65 years old.
Under Article 291 of the Labor Code, as
amended, all money claims arising from
employer-employee relations shall be filed
within three years from the time the cause of
action accrues.
ISSUES:
1) WON Part time employees are entitled to
retirement benefits?
2) WON Bernardo's cause of action for his
retirement benefits had already prescribed when
Bernardo filed his complaint only 10 years later
after reaching the compulsory retirement age of
65?
RULING:
1) Yes. The law does not distinguish between
part time and full time employees. Hence part
time employees are entitled to retirement
benefits provided the requisites are complied
with.
For the availment of the retirement benefits
under Article 302 [287] of the Labor Code, as
amended by Republic Act No. 7641, the
following requisites must concur: (1) the
employee has reached the age of 60 years for
optional retirement or 65 years for compulsory
retirement; (2) the employee has served at least
five years in the establishment; and (3) there is
no retirement plan or other applicable agreement
providing for retirement benefits of employees
in the establishment. Bernardo - being 75 years
old at the time of his retirement, having served
DLS-AU for a total of 27 years, and not being
covered by the grant of retirement benefits in the
CBA – is qualified to avail himself of retirement
benefits under said statutory provision, i.e.,
equivalent to one-half month salary for every
year of service, a fraction of at least six months
being considered as one whole year.
2) No. the cause of action for Bernardo's
retirement benefits only accrued after the refusal
of DLS-AU to pay him the same as expressed in
a letter dated February 12, 2004. Hence,
Bernardo's complaint, filed with the NLRC on
February 26, 2004, was filed within the three-
year prescriptive period provided under Article
291 of the Labor Code.
Erson Ang Lee doing business as Super
Lamination Services vs. Samahan ng Mga
Manggagawa ng Super Lamination (2016)
A settled formulation of the doctrine of piercing
the corporate veil is that when two business
enterprises are owned, conducted, and
controlled by the same parties, both law and
equity will, when necessary to protect the rights
of third parties, disregard the legal fiction that
these two entities are distinct and treat them as
identical or as one and the same
Therefore, it is only proper that, in order to
safeguard the right of the workers and Unions
A, B, and C to engage in collective bargaining,
the corporate veil of Express Lamination and
Express Coat must be pierced. The separate
existence of Super Lamination, Express
Lamination, and Express Coat must be
disregarded. In effect, we affirm the lower
tribunals in ruling that these companies must be
treated as one and the same unit for purposes of
holding a certification election
FACTS: Petitioner Erson Ang Lee (petitioner),
through Super Lamination, is a duly registered
entity principally engaged in the business of
providing lamination services to the general
public. Respondent Samahan ng mga
Manggagawa ng Super Lamination Services
(Union A) is a legitimate labor organization,
which is also a local chapter affiliate of the
National Federation of Labor Unions - Kilusang
Mayo Uno. It appears that Super Lamination is a
sole proprietorship under petitioner's name,
while Express Lamination and Express Coat are
duly incorporated entities separately registered
with the Securities and Exchange Commission
(SEC).
On 7 March 2008, Union A filed a Petition for
Certification Election to represent all the rank-
and-file employees of Super Lamination.
Notably, on the same date, Express Lamination
Workers' Union (Union B) also filed a Petition
for Certification Election to represent all the
rank-and-file employees of Express Lamination.
Also on the same date, the Samahan ng mga
Manggagawa ng Express Coat Enterprises, Inc.
(Union C) filed a Petition for Certification
Election to represent the rank-and-file
employees of Express Coat.
Super Lamination, Express Lamination, and
Express Coat, all represented by one counsel,
separately claimed in their Comments and
Motions to Dismiss that the petitions must be
dismissed on the same ground — lack of
employer-employee relationship between these
establishments and the bargaining units that
Unions A, B, and C seek to represent as well as
these unions' respective members. Super
Lamination, in its Motion, posited that a
majority of the persons who were enumerated in
the list of members and officers of Union A
were not its employees, but were employed by
either Express Lamination or Express Coat.
Interestingly, both Express Lamination and
Express Coat, in turn, maintained the same
argument that a majority of those who had
assented to the Petition for Certification Election
were not employees of either company, but of
one of the two other companies involved.
All three Petitions for Certification Election of
the Unions were denied. On 21 May 2008, an
Order was issued by DOLE National Capital
Region (NCR) Med-Arbiter Michael Angelo
Parado denying the respective petitions of
Unions B and C on the ground that there was no
existing employer-employee relationship
between the members of the unions and the
companies concerned. On 23 May 2008, DOLE
NCR Med-Arbiter Alma Magdaraog-Alba also
denied the petition of respondent Union A on the
same ground.
The three unions filed their respective appeals
before the Office of the DOLE Secretary, which
consolidated the appeal because the involved
companies alternately referred to one another as
the employer of the members of the bargaining
units sought to be represented. The unions
argued that their petitions should have been
allowed considering that the companies involved
were unorganized, and that the employers had
no concomitant right to oppose the petitions.
They also claimed that while the questioned
employees might have been assigned to perform
work at the other companies, they were all under
one management's direct control and
supervision.
ISSUES:
1) WON the application of the doctrine of
piercing the corporate veil is warranted to treat
separate corporations with related businesses as
a single bargaining unit?
2) WON rank-and-file employees of Super
Lamination, Express Lamination, and Express
Coat constitute an appropriate bargaining unit?
RULING:
1) Yes.
This Court has time and again disregarded
separate juridical personalities under the
doctrine of piercing the corporate veil. It has
done so in cases where a separate legal entity is
used to defeat public convenience, justify
wrong, protect fraud, or defend crime, among
other grounds. In any of these situations, the law
will regard it as associations of persons or, in
case of two corporations, merge them into one.
A settled formulation of the doctrine of piercing
the corporate veil is that when two business
enterprises are owned, conducted, and controlled
by the same parties, both law and equity will,
when necessary to protect the rights of third
parties, disregard the legal fiction that these two
entities are distinct and treat them as identical or
as one and the same.
This formulation has been applied by this Court
to cases in which the laborer has been put in a
disadvantageous position as a result of the
separate juridical personalities of the employers
involved. Pursuant to veil-piercing, we have
held two corporations jointly and severally liable
for an employee's back wages. We also
considered a corporation and its separately
incorporated branches as one and the same for
purposes of finding the corporation guilty of
illegal dismissal. These rulings were made
pursuant to the fundamental doctrine that the
corporate fiction should not be used as a
subterfuge to commit injustice and circumvent
labor laws. Here, a certification election was
ordered to be held for all the rank-and-file
employees of Super Lamination, Express
Lamination, and Express Coat. The three
companies were supposedly distinct entities
based on the fact that Super Lamination is a sole
proprietorship while Express Lamination and
Express Coat were separately registered with the
SEC. The directive was therefore, in effect, a
piercing of the separate juridical personalities of
the corporations involved. We find the piercing
to be proper and in accordance with the law.
Further, we discern from the synchronized
movements of petitioner and the two other
companies an attempt to frustrate or defeat the
workers' right to collectively bargain through the
shield of the corporations' separate juridical
personalities.
Due to the finger-pointing by the three
companies at one another, the petitions were
dismissed. As a result, the three unions were not
able to proceed with the conduct of the
certification election. This also caused confusion
among the employees as to who their real
employer is, as Union A claims in its Comment.
We hold that if we allow petitioner and the two
other companies to continue obstructing the
holding of the election in this manner, their
employees and their respective unions will never
have a chance to choose their bargaining
representative. We take note that all three
establishments were unorganized. That is, no
union therein was ever duly recognized or
certified as a bargaining representative.
Therefore, it is only proper that, in order to
safeguard the right of the workers and Unions A,
B, and C to engage in collective bargaining, the
corporate veil of Express Lamination and
Express Coat must be pierced. The separate
existence of Super Lamination, Express
Lamination, and Express Coat must be
disregarded. In effect, we affirm the lower
tribunals in ruling that these companies must be
treated as one and the same unit for purposes of
holding a certification election.
2) Yes
The basic test for determining the appropriate
bargaining unit is the application of a standard
whereby a unit is deemed appropriate if it affects
a grouping of employees who have substantial,
mutual interests in wages, hours, working
conditions, and other subjects of collective
bargaining. We have ruled that geographical
location can be completely disregarded if the
communal or mutual interests of the employees
are not sacrificed.
In the present case, there was communal interest
among the rank-and-file employees of the three
companies based on the finding that they were
constantly rotated to all three companies, and
that they performed the same or similar duties
whenever rotated. Therefore, aside from
geographical location, their employment status
and working conditions were so substantially
similar as to justify a conclusion that they shared
a community of interest. This finding is
consistent with the policy in favor of a single-
employer unit, unless the circumstances require
otherwise. The more solid the employees are, the
stronger is their bargaining capacity.
PAL vs. NLRC (1993)
When the subject affects the employees’ rights,
duties, and welfare, which in the given case
affecting the employee’s tenure, employees
participation in shaping the policy is required.
It must be noted however that participation does
not mean co-management. Participation in this
sense refers to the Union’s right to be allowed
to participate in policy formulation and
decision-making process on matters affecting
the Union members’ right, duties and welfare as
required by Art. 211 (a and g).
FACTS: PAL completely revised its 1966 Code
of Discipline. The Code was circulated among
the employees and was immediately
implemented, and some employees were
instantly subjected to the disciplinary measures.
Respondent PALEA filed a complaint before the
NLRC contending that PAL is guilty of unfair
labor practice due to its unilateral
implementation of the Code, specifically
violating par. E and G of Article 249 and Article
253 of the Labor Code. PALEA alleged that
copies of the Code had been circulated in limited
numbers; that being penal in nature the Code
must conform with the requirements of
sufficient publication, and that the Code was
arbitrary, oppressive, and prejudicial to the
rights of the employees. Respondent prayed that
implementation of the Code be held in abeyance;
that PAL should first discuss the substance of
the Code; that employees dismissed under the
Code be reinstated and their cases subjected to
further hearing; and that PAL should pay
damages.
PAL asserts its management prerogative and
further alleged that it had not violated the CBA
or any provision of the Labor Code. It
maintained that Article 253 of the Labor Code
cited by PALEA was inapplicable since the
current CBA had been negotiated.
ISSUE: WON management may be compelled
to share with the union or its employees its
prerogative of formulating a code of discipline?
RULING: Yes. PAL asserts that when it revised
its Code on March 15, 1985, there was no law
which mandated the sharing of responsibility
therefor between employer and employee. It was
only on March 2, 1989, with the approval of
Republic Act No. 6715, amending Article 211 of
the Labor Code, that the law explicitly
considered it a State policy "to ensure the
participation of workers in decision and policy-
making processes affecting the rights, duties and
welfare." However, even in the absence of said
clear provision of law, the exercise of
managerial prerogatives is not unlimited. It is
circumscribed by limitations found in law, a
collective bargaining agreement, or the general
principles of fair play and justice. Thus,
management prerogative must be without abuse
of discretion. When the subject affects the
employees’ rights, duties, and welfare, which in
the given case affecting the employee’s tenure,
employees participation in shaping the policy is
required. It must be noted however that
participation does not mean co-management.
Participation in this sense refers to the Union’s
right to be allowed to participate in policy
formulation and decision-making process on
matters affecting the Union members’ right,
duties and welfare as required by Art. 211 (a and
g).
The objectionable provisions of the Code reveal
that they are not purely business-oriented nor do
they concern the management aspect of the
business. Management should see to it that its
employees are at least properly informed of its
decisions. A provision in the CBA may not be
interpreted as cession of employees' rights to
participate in the deliberation of matters which
may affect their rights and the formulation of
policies such as the formulation of a code of
discipline. Whatever disciplinary measures are
adopted cannot be properly implemented in the
absence of full cooperation of the employees.
Such cooperation cannot be attained if the
employees are left out in the determination of
cardinal and fundamental matters affecting their
employment.
Note: Principle of Co-determination, employees
should be included in the deliberations regarding
the creation and implementation of a code of
conduct provided such code of conduct involves
the rights and benefits of the union/employees.
Rivera et. al. vs. Espiritu (2002)
In the instant case, it was PALEA, as the
exclusive bargaining agent of PAL’s ground
employees that voluntarily entered into the CBA
with PAL. It was also PALEA that voluntarily
opted for the 10-year suspension of the CBA.
Either case was the union’s exercise of its right
to collective bargaining. The right to free
collective bargaining includes the right to
suspend it. It can be deduced then that nothing
prohibits the parties from waiving or
suspending the mandate timetables and
agreeing on the remedies to enforce the same. In
sum, the Court is of the view that the PAL-
PALEA agreement dated Sept. 27, 1998 is valid
exercise of the freedom to contract. Under the
principle of inviolability of contracts guaranteed
by the Constitution, the contract must be upheld
FACTS: Faced with bankruptcy, PAL adopted a
rehabilitation plan and downsized its labor force
by more than one-third, prompting PALEA to go
on strike to protest the retrenchment measures
adopted by the airline. A Task Force composed
of herein public respondents was created to hold
conciliation meetings between PAL
management and the unions representing the
airline employees, among them PALEA. PAL
eventually ceased its operations and sent notices
of termination to its employees. However,
PALEA offered a 10-year moratorium on strikes
and similar actions and a waiver of some of the
economic benefits in the existing CBA. PAL
management accepted the PALEA proposal 7 and
the necessary referendum was scheduled. Of the
votes cast, 61% were in favor of accepting the
PAL-PALEA agreement, while 34% rejected it.
On the same date PAL resumed domestic
operations, seven officers and members of
PALEA filed this instant petition to annul the
agreement entered into between PAL and
PALEA on the ground that public respondents
gravely abused their discretion and exceeded
their jurisdiction in actively pursuing the
conclusion of the PAL-PALEA agreement as the
constitutional rights to self-organization and
7
*PALEA PROPOSAL (Terms and Conditions)
1. Each PAL employee shall be granted 60,000 shares of
stock with a par value of P5.00, from Mr. Lucio Tan’s
shareholdings, with three (3) seats in the PAL Board and an
additional seat from government shares as indicated by His
Excellency;
2. Likewise, PALEA shall, as far as practicable, be granted
adequate representation in committees or bodies which deal
with matters affecting terms and conditions of employment;
3. To enhance and strengthen labor-management relations,
the existing Labor-Management Coordinating Council shall
be reorganized and revitalized, with adequate
representation from both PAL management and PALEA;
4. To assure investors and creditors of industrial peace,
PALEA agrees, subject to the ratification by the general
membership, (to) the suspension of the PAL-PALEA
CBA for a period of ten (10) years, provided the
following safeguards are in place:
a. PAL shall continue recognizing PALEA as the duly
certified bargaining agent of the regular rank-and-file
ground employees of the Company;
b. The ‘union shop/maintenance of membership’
provision under the PAL-PALEA CBA shall be
respected.
c. No salary deduction, with full medical benefits.
5. PAL shall grant the benefits under the 26 July 1998
Memorandum of Agreement forged by and between PAL
and PALEA, to those employees who may opt to retire or
be separated from the company.
6. PALEA members who have been retrenched but have
not received separation benefits shall be granted priority in
the hiring/rehiring of employees.
7. In the absence of applicable Company rule or regulation,
the provisions of the Labor Code shall apply.
collective bargaining, being founded on public
policy, may not be waived, nor the waiver,
ratified.
ISSUE: WON the agreement stipulating the
suspension of the PAL-PALEA CBA is
unconstitutional and contrary to public policy?
RULING: No.
There is no conflict between said agreement and
Article 253-A of the Labor Code. Article 253-A
has a two-fold purpose. One is to promote
industrial stability and predictability. Inasmuch
as the agreement sought to promote industrial
peace at PAL during its rehabilitation, said
agreement satisfies the first purpose of Article
253-A. The other is to assign specific timetables
wherein negotiations become a matter of right
and requirement. Nothing in Article 253-A,
prohibits the parties from waiving or suspending
the mandatory timetables and agreeing on the
remedies to enforce the same.
In the instant case, it was PALEA, as the
exclusive bargaining agent of PAL’s ground
employees that voluntarily entered into the CBA
with PAL. It was also PALEA that voluntarily
opted for the 10-year suspension of the CBA.
Either case was the union’s exercise of its right
to collective bargaining. The right to free
collective bargaining includes the right to
suspend it. It can be deduced then that nothing
prohibits the parties from waiving or suspending
the mandate timetables and agreeing on the
remedies to enforce the same. In sum, the Court
is of the view that the PAL-PALEA agreement
dated Sept. 27, 1998 is valid exercise of the
freedom to contract. Under the principle of
inviolability of contracts guaranteed by the
Constitution, the contract must be upheld.
Further, the acts of public respondents in
sanctioning the 10-year suspension of the PAL-
PALEA CBA did not contravene the "protection
to labor" policy of the Constitution. The
agreement afforded full protection to labor;
promoted the shared responsibility between
workers and employers; and exercised the
voluntary modes in settling disputes, including
conciliation to foster industrial peace.
Moreover, the agreement does not violate the
five-year representation limit mandate by Article
253-A. Under said article, the representation
limit for the exclusive bargaining agent applies
only when there is an extant CBA in full force
and effect. In the instant case, the parties agreed
to suspend the CBA and put in abeyance the
limit on the representation period.
SMCEU-PTGWO vs. Hon. Confesor (1996)
In the event however, that the parties, by mutual
agreement, enter into a renegotiated contract
with a term of three (3) years or one which does
not coincide with the said 5-year term, and said
agreement is ratified by majority of the members
in the bargaining unit, the subject contract is
valid and legal and therefore, binds the
contracting parties. The same will however not
adversely affect the right of another union to
challenge the majority status of the incumbent
bargaining agent within sixty (60) days before
the lapse of the original five (5) year term of the
CBA.
FACTS: Petitioner-union entered into a CBA
with SMC to take effect upon the expiration of
the previous CBA or on June 30, 1989 until June
30, 1992. The CBA also stated that the term of
the Agreement insofar as the representation
aspect is concerned, shall be for 5 years from
July 1, 1989 to June 30, 1994. Hence, the
freedom period for purposes of such
representation shall be sixty (60) days prior to
June 30, 1994.
After June 30, 1992, the CBA was renegotiated
in accordance with the terms of the CBA and
Article 253-A of the Labor Code. Negotiations
started sometime in July, 1992 with the two
parties submitting their respective proposals and
counterproposals. During the negotiations, the
petitioner-union insisted that the bargaining unit
of SMC should still include the employees of the
spun-off corporations: Magnolia and SMFI; and
that the renegotiated terms of the CBA shall be
effective only for the remaining period of two
years or until June 30, 1994.
SMC, on the other hand, contended that the
members/employees who had moved to
Magnolia and SMFI, automatically ceased to be
part of the bargaining unit at the SMC.
Furthermore, the CBA should be effective for
three years in accordance with Art. 253-A of the
Labor Code.
ISSUES:
1) WON the duration of the renegotiated terms
of the CBA is to be effective for three years or
for only two years? And;
2) WON the bargaining unit of SMC includes
also the employees of the Magnolia and SMFI?
RULING:
1) The renegotiated terms of the CBA shall be
for three (3) years.
Article 253-A states that the CBA has a term of
five (5) years instead of three years, before the
amendment of the law as far as the
representation aspect is concerned. All other
provisions of the CBA shall be negotiated not
later than three (3) years after its execution. The
"representation aspect" refers to the identity and
majority status of the union that negotiated the
CBA as the exclusive bargaining representative
of the appropriate bargaining unit concerned.
"All other provisions" simply refers to the rest of
the CBA, economic as well as noneconomic
provisions, except representation.
From the congressional discussions, the
legislators were more inclined to have the period
of effectivity for three (3) years insofar as the
economic as well as non-economic provisions
are concerned, except representation. Obviously,
the framers of the law wanted to maintain
industrial peace and stability by having both
management and labor work harmoniously
together without any disturbance. Thus, no
outside union can enter the establishment within
five (5) years and challenge the status of the
incumbent union as the exclusive bargaining
agent. Likewise, the terms and conditions of
employment (economic and non-economic)
cannot be questioned by the employers or
employees during the period of effectivity of the
CBA.
The CBA is a contract between the parties and
the parties must respect the terms and conditions
of the agreement. Notably, the framers of the
law did not give a fixed term as to the effectivity
of the terms and conditions of employment. It
can be gleaned from their discussions that it was
left to the parties to fix the period. As a matter of
policy the parties are encouraged to enter into a
renegotiated CBA with a term which would
coincide with the aforesaid five (5) year term of
the bargaining representative. In the event
however, that the parties, by mutual agreement,
enter into a renegotiated contract with a term of
three (3) years or one which does not coincide
with the said 5-year term, and said agreement is
ratified by majority of the members in the
bargaining unit, the subject contract is valid and
legal and therefore, binds the contracting parties.
The same will however not adversely affect the
right of another union to challenge the majority
status of the incumbent bargaining agent within
sixty (60) days before the lapse of the original
five (5) year term of the CBA.
2) No. As a result of the spin-offs:
1. Each of the companies are run by, supervised
and controlled by different management teams
including separate human resource/personnel
managers.
2. Each Company enforces its own
administrative and operational rules and policies
and are not dependent on each other in their
operations.
3. Each entity maintains separate financial
statements and are audited separately from each
other.
Indubitably, therefore, Magnolia and SMFI
became distinct entities with separate juridical
personalities. Thus, they can not belong to a
single bargaining unit. There are various factors
which must be satisfied and considered in
determining the proper constituency of a
bargaining unit. (1) will of the employees
(Globe Doctrine); (2) affinity and unit of
employees' interest, such as substantial
similarity of work and duties, or similarity of
compensation and working conditions; (3) prior
collective bargaining history; and (4)
employment status, such as temporary, seasonal
and probationary employees.
Even assuming in gratia argumenti that at the
time of the election they were regular employees
of San Miguel, nonetheless, these workers are
no longer connected with San Miguel
Corporation in any manner because Magnolia
has ceased to be a division of San Miguel
Corporation and has been formed into a separate
corporation with a personality of its own. This
development, which was brought to our
attention by private respondents, necessarily
renders moot and academic any further
discourse on the propriety of the elections which
petitioners impugn via the recourse.
ALU vs. Ferrer-Calleja (November 6, 1989)
PASAR hastily concluded a CBA despite the
order of the Med-Arbiter enjoining them from
doing so until the issue of representation is
finally resolved. As pointed out by public
respondent in its comment, the parties were in
bad faith when they concluded the CBA. Their
act was clearly intended to bar the petition for
certification election filed by NAFLU. A
collective bargaining agreement which was
prematurely renewed is not a bar to the holding
of a certification election. Such indecent haste
in renewing the CBA despite an order enjoining
them from doing so is designed to frustrate the
constitutional right of the employees to self-
organization
FACTS: The Philippine Associated Smelting
and Refining Corporation (PASAR) is a
corporation established and existing pursuant to
Philippine laws and is engaged in the
manufacture and processing of copper cathodes
with a plant operating in Isabel, Leyte.
Petitioner Associated Labor Union (ALU) had a
collective bargaining agreement (CBA) with
PASAR which expired on April 1, 1987. Several
days before the expiration of the said CBA or on
March 23, 1987, private respondent National
Federation of Labor Unions (NAFLU) filed a
petition for certification election with the Bureau
of Labor Relations Regional Office in Tacloban
City docketed as MED-ARB-RO VII Case No.
3-28-87, alleging, among others, that no
certification election had been held in PASAR
within twelve (12) months immediately
preceding the filing of the said petition.
Petitioner moved to intervene and sought the
dismissal of the petition on the ground that
NAFLU failed to present the necessary
signatures in support of its petition. In the order
dated April 21, 1987, Med-Arbiter Bienvenido
C. Elorcha dismissed the petition. However, the
order of dismissal was set aside in another order
dated May 8, 1987 and the case was rescheduled
for hearing on May 29, 1987. The said order
likewise enjoined PASAR from entering into a
collective bargaining agreement with any union
until after the issue of representation is finally
resolved. In the order dated June 1, 1987, the
petition for certification was dismissed for
failure of NAFLU to solicit 20% of the total
number of rank and file employees while ALU
submitted 33 pages containing the signatures of
88.5% of the rank and file employees at
PASAR.
Private respondent appealed the order of
dismissal to the Bureau of Labor Relations.
While the appeal was pending, petitioner ALU
concluded negotiations with PASAR on the
proposed CBA. On July 24, 1987, copies of the
newly concluded CBA were posted in four (4)
conspicuous places in the company premises.
The said CBA was ratified by the members of
the bargaining unit on July 28, 1987.[3]
Thereafter, petitioner ALU moved for the
dismissal of the appeal alleging that it had just
concluded a CBA with PASAR and that the said
CBA had been ratified by 98% of the regular
rank-and-file employees and that at least 75 of
NAFLU’s members renounced their
membership thereat and affirmed membership
with PEA-ALU in separate affidavits.
In a resolution dated September 30, 1987, the
public respondent gave due course to the appeal
by ordering the conduct of a certification
election among the rank-and-file employees of
PASAR with ALU, NAFLU and no union as
choices, and denied petitioner’s motion to
dismiss.
Both parties moved for reconsideration of the
said resolution. However, both motions were
denied by public respondent in the order dated
April 22, 1988.
ISSUES:
1) WON the holding of certification elections in
organized establishments is mandated only
where a petition is filed questioning the majority
status of the incumbent union, and that it is only
after establishing that a union has indeed a
considerable support that a certification election
should be ordered?
2) WON the petition filed by NAFLU was
instituted within the freedom period?
RULING:
1) No.
Article 257 is applicable only to unorganized
labor organizations and not to establishments
like PASAR where there exists a certified
bargaining agent, petitioner ALU, which as the
record shows had previously entered into a CBA
with the management. This could be discerned
from the clear intent of the law which provides
that —
“ART. 257. Petitions in unorganized
establishments. — In any establishment where
there is no certified bargaining agent, the
petition for certification election filed by a
legitimate labor organization shall be supported
by the written consent of at least twenty per cent
(20%) of all the employees in the bargaining
unit. Upon receipt and verification of such
petition, the Med-Arbiter shall automatically
order the conduct of a certification election.”
Said article traverses the claim of the petitioner
that in this case there is a need for a considerable
support of the rank-and-file employees in order
that a certification election may be ordered.
Nowhere in the said provision does it require
that the petition in organized establishments
should be accompanied by the written consent of
at least twenty percent (20%) of the employees
of the bargaining unit concerned much less a
requirement that the petition be supported by the
majority of the rank-and-file employees. As
above stated, Article 257 is applicable only to
unorganized establishments. The Court reiterates
that in cases of organized establishments where
there exists a certified bargaining agent, what is
essential is whether the petition for certification
election was filed within the sixty-day freedom
period. Article 256 of the Labor Code, as
amended by Executive Order No. 111 provides:
“ART. 256. Representation issue in organized
establishments. — In organized establishments,
when a petition questioning the majority status
of the incumbent bargaining agent is filed
before the Department within the sixty-day
period before the expiration of the collective
bargaining agreement, the Med-Arbiter shall
automatically order an election by secret ballot
to ascertain the will of the employees in the
appropriate bargaining unit. To have a valid
election, at least a majority of all elegible voters
in the unit must have cast their votes. The labor
union receiving the majority of the valid votes
cast shall be certified as the exclusive
bargaining agent of all the workers in the unit.
When an election which provides for three or
more choices results in no choice receiving a
majority of the valid votes cast, a run-off
election shall be conducted between the choices
receiving the two highest number of votes.”
Article 256 is clear and leaves no room for
interpretation. The mere filing of a petition for
certification election within the freedom period
is sufficient basis for the respondent Director to
order the holding of a certification election.
2) Yes.
The previous CBA entered into by petitioner
ALU was due to expire on April 1, 1987. The
petition for certification was filed by NAFLU on
March 23, 1987, well within the freedom period.
The contract bar rule is applicable only where
the petition for certification election was filed
either before or after the freedom period.
Petitioner, however, contends that since the new
CBA had already been ratified overwhelmingly
by the members of the bargaining unit and that
said CBA had already been consummated and
the members of the bargaining unit have been
continuously enjoying the benefits under the
said CBA, no certification election may be
conducted, citing, Foamtex Labor Union-
TUPAS vs. Noriel, and Trade Unions of the
Phil. and Allied Services vs. Inciong.
The reliance on the aforementioned cases is
misplaced.
In Foamtex, the petition for certiorari
questioning the validity of the order of the
Director of Labor Relations which in turn
affirmed the order of the Med-Arbiter calling for
a certification election was dismissed by the
Court on the ground that although a new CBA
was concluded between the petitioner and the
management, only a certified CBA would serve
as a bar to the holding of a certification election,
citing Article 232 of the Labor Code.
Foamtex weakens rather than strengthens
petitioner’s stand. As pointed out by public
respondent, the new CBA entered into between
petitioner on one hand and by the management
on the other has not been certified as yet by the
Bureau of Labor Relations. There is an
appreciable difference in Trade Unions of the
Phil. and Allied Services (TUPAS for short).
Here, as in Foamtex, the CBA was not yet
certified and yet the Court affirmed the order of
the Director of the Bureau of Labor Relations
which dismissed the petition for certification
election filed by the labor union.
In TUPAS, the dismissal of the petition for
certification, was based on the fact that the
contending union had a clear majority of the
workers concerned since out of 641 of the total
working force, the said union had 499 who did
not only ratify the CBA concluded between the
said union and the management but also
affirmed their membership in the said union so
that apparently petitioners therein did not have
the support of 30% of all the employees of the
bargaining unit.
Nevertheless, even assuming for the sake of
argument that the petitioner herein has the
majority of the rank-and-file employees and that
some members of the NAFLU even renounced
their membership thereat and affirmed
membership with the petitioner, We cannot,
however, apply TUPAS in the case at bar.
Unlike in the case of herein petitioner, in
TUPAS, the petition for certification election
was filed nineteen (19) days after the CBA was
signed which was well beyond the freedom
period.
On the other hand, as earlier mentioned, the
petition for certification election in this case was
filed within the freedom period but the petitioner
and PASAR hastily concluded a CBA despite
the order of the Med-Arbiter enjoining them
from doing so until the issue of representation is
finally resolved. As pointed out by public
respondent in its comment, the parties were in
bad faith when they concluded the CBA. Their
act was clearly intended to bar the petition for
certification election filed by NAFLU. A
collective bargaining agreement which was
prematurely renewed is not a bar to the holding
of a certification election. Such indecent haste in
renewing the CBA despite an order enjoining
them from doing so is designed to frustrate the
constitutional right of the employees to self-
organization. Moreover, we cannot countenance
the actuation of the petitioner and the
management in this case which is not conducive
to industrial peace.
The renewed CBA cannot constitute a bar to the
instant petition for certification election for the
very reason that the same was not yet in
existence when the said petition was filed The
holding of a certification election is a statutory
policy that should not be circumvented.
Union of Filipro Employees vs. Nestle (2008)
G.R. No. 158930-31
The corporation simply wanted to exclude the
Retirement Plan from the issues to be taken up
during CBA negotiations, on the postulation that
such was in the nature of a unilaterally granted
benefit. An employer’s steadfast insistence to
exclude a particular substantive provision is no
different from a bargaining representative’s
perseverance to include one that they deem of
absolute necessity. It is not enough that the
union believed that the employer committed acts
of unfair labor practice when the circumstances
clearly negate even a prima facie showing to
warrant such a belief.
FACTS: UFE-DFA-KMU was the sole and
exclusive bargaining agent of the rank-and-file
employees of Nestlé belonging to the latter’s
Alabang and Cabuyao plants. (CBA) between
Nestlé and UFE-DFA-KMU was to end on 5
June 2001, the Presidents of the Alabang and
Cabuyao Divisions of UFE-DFA-KMU
informed Nestlé of their intent to "open [our]
new Collective Bargaining Negotiation for the
year 2001-2004 x x x as early as June 2001."
Nestlé informed them that it was also preparing
its own counter-proposal.
Dialogue between the company and the union
thereafter ensued. Nestlé requested NCMB to
conduct preventive mediation proceedings
between it and UFE-DFA-KMU owing to an
alleged impasse in said dialogue. Conciliation
proceedings proved ineffective UFE-DFA-KMU
filed a Notice of Strike with the NCMB,
complaining, in essence, of a bargaining
deadlock pertaining to economic issues, i.e.,
"retirement (plan). Another Notice of Strike was
filed by the union, this time predicated on
Nestlé’s alleged unfair labor practices. Prior to
holding the strike, Nestlé filed with the DOLE a
Petition for Assumption of Jurisdiction, praying
for the Secretary of the DOLE, Hon. Patricia A.
Sto. Tomas, to assume jurisdiction over the
current labor dispute.
Sec. Sto. Tomas issued an Order15 assuming
jurisdiction over the subject labor dispute.
Accordingly, any strike or lockout is hereby
enjoined. The parties are further directed to meet
and convene for the discussion before the
NCMB. If no settlement of all the issues is
reached, this Office shall thereafter define the
outstanding issues and order the filing of
position papers for a ruling on the merits.
Despite the order enjoining the conduct of any
strike or lockout and conciliation efforts by the
NCMB, the employee members of UFE-DFA-
KMU at Nestlé’s Cabuyao Plant went on strike.
Sec. Sto. Tomas directed them to Return-to-
Work. Notwithstanding the Return-to-Work
Order, the members of UFE-DFA-KMU
continued with their strike, thus, prompting Sec.
Sto. Tomas to seek the assistance of the
Philippine National Police (PNP) for the
enforcement of said order.
Nestlé and UFE-DFA-KMU filed their
respective position papers.
UFE-DFA-KMU filed several pleadings, one of
which was a Manifestation with Motion for
Reconsideration. The union posited that Sec.
Sto. Tomas "could only assume jurisdiction over
the issues mentioned in the notice of strike
subject of the current dispute. Sec. Sto. Tomas
denied the motion for reconsideration of UFE-
DFA-KMU.
Thereafter, UFE-DFA-KMU filed a Petition for
Certiorari before the Court of Appeals.
In the interim, in an attempt to finally resolve
the crippling labor dispute between the parties,
then Acting Secretary of the DOLE, Hon. Arturo
D. Brion, came out with an Order that:
Retirement Plan not a mandatory subject for
bargaining; ULP against the Company is hereby
dismissed; all union demands that are not
covered by the provisions of the CBAs are
hereby denied; the parties shall execute their
CBA within thirty (30) days from receipt of this
Order.
UFE-DFA-KMU moved to reconsider the
aforequoted ruling, but such was subsequently
denied. For the second time, UFE-DFA-KMU
went to the Court of Appeals via another
Petition for Certiorari seeking to annul the
Orders.
CA: promulgated its Decision on the twin
petitions for certiorari, ruling entirely in favor of
UFE-DFA-KMU. Both parties appealed the
ruling. UFE-DFA-KMU argues therein that
Nestlé’s "refusal to bargain on a very important
CBA economic provision constitutes unfair
labor practice." It explains that Nestlé set as a
precondition for the holding of collective
bargaining negotiations the non-inclusion of the
issue of Retirement Plan.
ISSUE/S:
1) WON Nestle is guilty of ULP?
2) WON the DOLE Secretary’s jurisdiction was
limited to the resolution of questions and matters
pertaining merely to the ground rules of the
collective bargaining negotiations?
3) WON the order of resumption of negotiations
respecting the Retirement Plan directs the parties
to submit to a voluntary mode of dispute
settlement?
RULING:
1) NO. The duty to bargain collectively is
mandated by Labor Code
ART. 252. Meaning of duty to bargain
collectively. – The duty to bargain collectively
means the performance of a mutual obligation
to meet and convene promptly and expeditiously
in good faith for the purpose of negotiating an
agreement with respect to wages, hours, of work
and all other terms and conditions of
employment including proposals for adjusting
any grievances or questions arising under such
agreement and executing a contract
incorporating such agreements if requested by
either party but such duty does not compel any
party to agree to a proposal or to make any
concession.
The statutes invite and contemplate a collective
bargaining contract, but they do not compel one.
The duty to bargain does not include the
obligation to reach an agreement.
For a charge of unfair labor practice to prosper,
it must be shown that Nestlé was motivated by
ill will, "bad faith, or fraud, or was oppressive to
labor, or done in a manner contrary to morals,
good customs, or public policy, and, of course,
that social humiliation, wounded feelings, or
grave anxiety resulted x x x" In disclaiming
unilateral grants as proper subjects in their
collective bargaining negotiations. While the
law makes it an obligation for the employer and
the employees 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.
Herein, the union merely bases its claim of
refusal to bargain on a letter by Nestlé where the
latter laid down its position that "unilateral
grants, one-time company grants, company-
initiated policies and programs, which include,
but are not limited to the Retirement Plan,
Incidental Straight Duty Pay and Calling Pay
Premium, are by their very nature not proper
subjects of CBA negotiations and therefore shall
be excluded therefrom." Said letter is not
tantamount to refusal to bargain.
The corporation simply wanted to exclude the
Retirement Plan from the issues to be taken up
during CBA negotiations, on the postulation that
such was in the nature of a unilaterally granted
benefit. An employer’s steadfast insistence to
exclude a particular substantive provision is no
different from a bargaining representative’s
perseverance to include one that they deem of
absolute necessity. It is not enough that the
union believed that the employer committed acts
of unfair labor practice when the circumstances
clearly negate even a prima facie showing to
warrant such a belief.
Employers are accorded rights and privileges to
assure their self-determination and independence
and reasonable return of capital. There is no per
se test of good faith in bargaining. Good faith or
bad faith is an inference to be drawn from the
facts.
2) NO. The Secretary of the DOLE simply relied
on the Notices of Strike that were filed by UFE-
DFA-KMU alleging bargaining deadlock. Based
on the Notices of Strike filed by UFE-DFA-
KMU, the Secretary of the DOLE rightly
decided on matters of substance. That the union
later on changed its mind is of no moment
because to give premium to such would make
the legally mandated discretionary power of the
Dole Secretary subservient to the whims of the
parties.
3) NO. Nowhere in the Court’s previous
Decision did we require parties to submit to
negotiate by themselves the tenor of the
retirement benefits of the concerned employees
of Nestlé, precisely because the Secretary of the
DOLE had already assumed jurisdiction over the
labor dispute subject of herein petitions. The
Secretary of the DOLE has been explicitly
granted by Article 263(g) of the Labor Code the
authority to assume jurisdiction over a labor
dispute causing or likely to cause a strike or
lockout in an industry indispensable to the
national interest, and decide the same
accordingly. And, as a matter of necessity, it
includes questions incidental to the labor
dispute; that is, issues that are necessarily
involved in the dispute itself, and not just to that
ascribed in the Notice of Strike or otherwise
submitted to him for resolution. The Secretary
having already assumed jurisdiction over the
labor dispute subject of these consolidated
petitions, the issue concerning the retirement
benefits of the concerned employees must be
remanded back to him for proper disposition.
Samahan ng Manggagawa ng Filsystems vs.
Secretary (1998)
A dismissal of a petition for certification
election seasonably appealed shall stop the
holding of any certification of election, pursuant
to Rule V, Section 10, which provides that the
filing of the appeal from the decision of the
Med-Arbiter stays the holding of any
certification election
FACTS: Petitioner Samahan ng mga
Manggagawa sa Filsystems (SAMAFIL-
NAFLU-KMU) filed a petition for certification
election among the rank-and-file employees of
Filsystems. It submitted the Certificate of
Registration issued by the DOLE, copies of
union membership signed by 33 rank-and-file
employees of the company, the Charter
Certificate showing its affiliation with the
NAFLU, the list of union officers, the
certification of the union secretary of the
minutes of the general membership meeting, the
Books of Accounts and its CBL.
Filsystems opposed the petition, questioning the
status of petitioner as a legitimate labor org on
the ground of lack of proof that its contract of
affiliation with the NAFLU-KMU has been
submitted to the BLR within 30 days from its
execution. Petitioner replied that as a duly
registered labor union, it has all the rights and
privileges to act as representative of its members
for the purpose of collective bargaining with
employers.
The Med-Arbiter dismissed the petition for
certification election. He ruled that petitioner, as
an affiliate of NAFLU-KMU, has no legal
personality on account of its failure to comply
with pars (a), (b), and (e) of Rule II§3 of the
Implementing Rules of the LC.
Petitioner appealed to the Office of the SOLE,
reiterating its contention that as an
independently registered union, it has the right
to file a petition for certification election
regardless of its failure to prove its affiliation
with the NAFLU-KMU. Filsystems opposed the
appeal.
On Feb. 7, 1996, the Filsystems Workers Union
(FWU) filed a PCE in the same bargaining unit,
which the Med-Arbitration – NCR Branch
granted on April 19, 1996.
Filsystems filed a Motion to Dismiss Appeal of
petitioner as it has become moot and academic.
It invoked Rule V§3 of the Implementing Rules
of Book V of the LC stating that “once a union
has been certified, no certification election may
be held within one year from the date of
issuance of a final certification election”.
In its opposition, petitioner contended its appeal
is not moot as the certification election held on
April 19, 1996 was void as
a. It violated Rule V Sec. 108 of the
Implementing Rules of the LC, which provides
that the filing of the appeal from the decision of
the Med-Arbiter stays the holding of any
certification election.
b. The CBA executed between FWU and
Filsystems could not affect its pending
8
Rule V Section 10: Decision of the Secretary Final
and Inappealable. – The Secretary shall have fifteen
(15) calendar days within which to decide the appeal
from receipt of the records of the case. The filing of
the appeal from the decision of the Med-Arbiter stays
the holding of any certification election. The decision
of the Secretary shall be final and inappealable.
representation case pursuant to Rule V§4 which
provides that the representation case shall not be
adversely affected by a CBA registered before or
during the last 60 days of the subsisting
agreement or during the pendency of the
representation case.
SOLE: Dismissed SAMAFIL’s appeal as it has
been rendered MOOT by the subsequent
certification of FWU as the sole and exclusive
bargaining agent of the R&F workers of
respondent company
ISSUES:
1) WON petitioner had legal personality to file
the petition
2) WON the appeal was rendered moot and
academic
RULING:
1) Yes.
Petitioner is an independently registered labor
union. As a legitimate labor organization, its
right to file a petition for certification election
cannot be questioned. Reasoning Petitioner’s
failure to prove its affiliation with NAFLU-
KMU will, at most, result in an ineffective
affiliation. Despite affiliation, the local union
remains the basic unit free to serve the interests
of its members independently of the federation.
2) No.
Petitioner’s appeal was not rendered moot and
academic by virtue of the subsequent
certification election later held on April 19,
1996. The order of the Med-Arbiter dismissing
petitioner’s petition for certification election was
seasonably appealed. The appeal stopped the
holding of any certification election.
There was an unresolved representation case at
the time Filsystems entered into a CBA with
FWU. Following Rule V Section 4 of the
Implementing Rules of Book V of the LC, such
CBA cannot and will not prejudice petitioner’s
pending representation case or render the same
moot. This rule was applied in Associated
Labor Unions (ALU-TUCP) v. Trajano where
the Court held that “There should be no obstacle
to the right of the employees to petition for a
certification election at the proper time, which is
60 days prior to the expiration of the life of a
certified CBA x x x, not even by a collective
agreement submitted during the pendency of the
representation case.
Kiok Loy vs. NLRC (1986)
Unfair labor practice is committed when it is
shown that the respondent employer, after
having been served with a written bargaining
proposal by the petitioning Union, did not even
bother to submit an answer or reply to the said
proposal.
A Company's refusal to make counter proposal
if considered in relation to the entire bargaining
process, may indicate bad faith and this is
especially true where the Union's request for a
counter proposal is left unanswered.
FACTS: Pambansang Kilusang Paggawa
(Union for short) won and was subsequently
certified in a resolution by the BLR in a
certification election as the sole and exclusive
bargaining agent of the rank-and-file employees
of Sweden Ice Cream Plant (Company for
short). The Company's motion for
reconsideration of the said resolution was
denied.
The Company was given two copies of its
proposed collective bargaining agreement by the
Union. At the same time, it requested the
Company for its counter proposals. Eliciting no
response to the aforesaid request, the Union
again wrote the Company reiterating its request
for collective bargaining negotiations and for the
Company to furnish them with its counter
proposals. Both requests were ignored and
remained unacted upon by the Company.
The Union filed a "Notice of Strike", with the
BLR on ground of unresolved economic issues
in collective bargaining. Conciliation
proceedings then followed during the thirty-day
statutory cooling-off period. But all attempts
towards an amicable settlement failed,
prompting the Bureau of Labor Relations to
certify the case to the NLRC for compulsory
arbitration. The Union submitted its position
paper. The Company did not and instead
requested for a resetting which was granted. The
case was further reset to May 11, 1979 due to
the withdrawal of the Company's counsel of
record. Atty. Fortunato Panganiban formally
entered his appearance as counsel for the
Company only to request for another
postponement allegedly for the purpose of
acquainting himself with the case. Meanwhile,
the Company submitted its position paper on
May 28, 1979. the Company's representative,
Mr. Ching, who was supposed to be examined,
failed to appear. Atty. Panganiban then
requested for another postponement which the
labor arbiter denied.
LA ruled that the Company has waived its right
to present further evidence and, therefore,
considered the case submitted for resolution.
NLRC: Guilty of unjustified refusal to bargain
Petitioner Company now maintains that its right
to procedural due process has been violated
when it was precluded from presenting further
evidence in support of its stand and when its
request for further postponement was denied;
that when the Union furnished them with a copy
of the proposed Collective Bargaining
Agreement and it was only then that they came
to know of the Union's demands; and finally,
that the Collective Bargaining Agreement
approved and adopted by the NLRC is
unreasonable and lacks legal basis.
ISSUE: WON the company is guilty of ULP?
RULING: Yes. Petition lacks merit. There can
be no doubt that the Union has a valid cause to
complain against its (Company's) attitude, the
totality of which is indicative of the latter's
disregard of, and failure to live up to, what is
enjoined by the Labor Code — to bargain in
good faith.
Collective bargaining is one of the democratic
frameworks under the New Labor Code,
designed to stabilize the relation between labor
and management and to create a climate of
sound and stable industrial peace. It is a mutual
responsibility of the employer and the Union
and is characterized as a legal obligation.
While it is a mutual obligation of the parties to
bargain, the employer, however, is not under any
legal duty to initiate contract negotiation. The
mechanics of collective bargaining is set in
motion only when the following jurisdictional
preconditions are present, namely, (1)
possession of the status of majority
representation of the employees' representative
in accordance with any of the means of selection
or designation provided for by the Labor Code;
(2) proof of majority representation; and (3) a
demand to bargain under Article 251, par. (a) of
the New Labor Code all of which preconditions
are undisputedly present in the instant case.
We are in total conformity with respondent
NLRC's pronouncement that petitioner
Company is GUILTY of unfair labor practice. It
has been indubitably established that (1)
respondent Union was a duly certified
bargaining agent; (2) it made a definite request
to bargain, accompanied with a copy of the
proposed Collective Bargaining Agreement, to
the Company not only once but twice which
were left unanswered and unacted upon; and (3)
the Company made no counter proposal
whatsoever all of which conclusively indicate
lack of a sincere desire to negotiate.
A Company's refusal to make counter proposal
if considered in relation to the entire bargaining
process, may indicate bad faith and this is
especially true where the Union's request for a
counter proposal is left unanswered. Even
during the period of compulsory arbitration
before the NLRC, petitioner Company's
approach and attitude stalling the negotiation by
a series of postponements, non-appearance at the
hearing conducted, and undue delay in
submitting its financial statements, lead to no
other conclusion except that it is unwilling to
negotiate and reach an agreement with the
Union.
Petitioner has not at any instance, evinced good
faith or willingness to discuss freely and fully
the claims and demands set forth by the Union
much less justify its opposition thereto.
Certainly, the moves and overall behavior of
petitioner-company were in total derogation of
the policy enshrined in the New Labor Code
which is aimed towards expediting settlement of
economic disputes.
Hence, this Court is not prepared to affix its
imprimatur to such an illegal scheme and
dubious maneuvers. Where the intervention of
the National Labor Relations Commission was
properly sought for after conciliation efforts
undertaken by the BLR failed. The instant case
being a certified one, it must be resolved by the
NLRC pursuant to the mandate of P.D. 873, as
amended, which authorizes the said body to
determine the reasonableness of the terms and
conditions of employment embodied in any
Collective Bargaining Agreement. To that
extent, utmost deference to its findings of
reasonableness of any Collective Bargaining
Agreement as the governing agreement by the
employees and management must be accorded
due respect by this Court.
Note: The law does not require the employer to
file a counter-proposal, but a reply. As
consequence of failing to file a reply within the
prescribed period, the proposal given by the
union will automatically become the CBA.
Cainta Catholic School vs. Cainta Catholic
School Employees Union (2006)
A CBA may validly accord management the
prerogative to optionally retire an employee
under the terms and conditions mutually agreed
upon by management and the bargaining union,
even if such agreement allows for retirement at
an age lower than the optional retirement age
or the compulsory retirement age
FACTS: On 15 October 1993, petitioner school
retired Llagas and Javier, President and Vice-
president of respondent union, respectively, who
had rendered more than twenty (20) years of
continuous service, pursuant to Section 2,
Article X of the CBA, to wit:
An employee may be retired, either upon
application by the employee himself or by the
decision of the Director of the School, upon
reaching the age of sixty (60) or after having
rendered at least twenty (20) years of service to
the School the last three (3) years of which must
be continuous.
Because of the foregoing, the union filed a
Notice of Strike with the NCMB and later staged
a strike and picketed in the school’s entrance.
Later, the union filed a complaint for unfair
labor practice against petitioner school before
the NLRC.
The School avers that the retirement of Llagas
and Javier was clearly in accordance with a
specific right granted under the CBA. The
School justifies its actions by invoking our
rulings in Pantranco North Express, Inc. v.
NLRC and Bulletin Publishing Corporation v.
Sanchez that no unfair labor practice is
committed by management if the retirement was
made in accord with management prerogative or
in case of voluntary retirement, upon approval of
management.
The Union, on the other hand, argues that the
retirement of the two union officers is a mere
subterfuge to bust the union.
ISSUE: WON the retirement of Llagas and
Javier is legal?
RULING: Yes.
The SC held that the termination of employment
of Llagas and Javier was valid, arising as it did
from a management prerogative granted by the
mutually-negotiated CBA between the School
and the Union.
Pursuant to the existing CBA, the School has the
option to retire an employee upon reaching the
age limit of sixty (60) or after having rendered at
least twenty (20) years of service to the School,
the last three (3) years of which must be
continuous. Retirement is different specie of
termination of employment from dismissal for
just or authorized causes under Articles 282 and
283 of the Labor Code. While in all three cases,
the employee to be terminated may be unwilling
to part from service, there are eminently higher
standards to be met by the employer validly
exercising the prerogative to dismiss for just or
authorized causes. In those two instances, it is
indispensable that the employer establish the
existence of just or authorized causes for
dismissal as spelled out in the Labor Code.
Retirement, on the other hand, is the result of a
bilateral act of the parties, a voluntary agreement
between the employer and the employee
whereby the latter after reaching a certain age
agrees and/or consents to sever his employment
with the former.
Article 287 of the Labor Code, as amended,
governs retirement of employees, stating:
ART. 287. Retirement. – Any employee may
be retired upon reaching the retirement age
established in the collective bargaining
agreement or other applicable employment
contract.
In case of retirement, the employee shall be
entitled to receive such retirement benefits as he
may have earned under existing laws and any
collective bargaining agreement and other
agreements: Provided, however, That an
employee’s retirement benefits under any
collective bargaining agreement and other
agreements shall not be less than those provided
herein.
In the absence of a retirement plan or
agreement providing for retirement benefits of
employees in the establishment, an employee
upon reaching the age of sixty (60) years or
more, but not beyond sixty-five (65) years which
is hereby declared the compulsory retirement
age, who has served at least five (5) years in the
said establishment, may retire and shall be
entitled to retirement pay equivalent to at least
one-half (1/2) month salary for every year of
service, a fraction of at least six (6) months
being considered as one whole year.
By their acceptance of the CBA, the Union and
its members are obliged to abide by the
commitments and limitations they had agreed to
cede to management. The questioned retirement
provisions cannot be deemed as an imposition
foisted on the Union, which very well had the
right to have refused to agree to allow
management to retire employees with at least 20
years of service.
It should not be taken to mean that retirement
provisions agreed upon in the CBA are
absolutely beyond the ambit of judicial review
and nullification. A CBA, as a labor contract, is
not merely contractual in nature but impressed
with public interest. If the retirement provisions
in the CBA run contrary to law, public morals,
or public policy, such provisions may very well
be voided. Certainly, a CBA provision or
employment contract that would allow
management to subvert security of tenure and
allow it to unilaterally “retire” employees after
one month of service cannot be upheld. Neither
will the Court sustain a retirement clause that
entitles the retiring employee to benefits less
than what is guaranteed under Article 287 of the
Labor Code, pursuant to the provision’s express
proviso thereto in the provision.
Yet the CBA in the case at bar contains no such
infirmities which must be stricken down.
Twenty years is a more than ideal length of
service an employee can render to one employer.
Under ordinary contemplation, a CBA provision
entitling an employee to retire after 20 years of
service and accordingly collect retirement
benefits is “reward for services rendered since it
enables an employee to reap the fruits of his
labor — particularly retirement benefits,
whether lump-sum or otherwise — at an earlier
age, when said employee, in presumably better
physical and mental condition, can enjoy them
better and longer.”
A CBA may validly accord management the
prerogative to optionally retire an employee
under the terms and conditions mutually agreed
upon by management and the bargaining union,
even if such agreement allows for retirement at
an age lower than the optional retirement age or
the compulsory retirement age.
Petition is granted.
Malayang Samahan ng mga Manggagawa sa
Greenfield vs. Ramos (2000)
While respondent company may validly dismiss
the employees expelled by the union for
disloyalty under the union security clause of the
collective bargaining agreement upon the
recommendation by the union, this dismissal
should not be done hastily and summarily
thereby eroding the employees right to due
process, self-organization and security of
tenure. The enforcement of union security
clauses is authorized by law provided such
enforcement is not characterized by
arbitrariness, and always with due process.
Even on the assumption that the federation had
valid grounds to expel the union officers, due
process requires that these union officers be
accorded a separate hearing by respondent
company.
FACTS: MSMG is the local union/affiliate of
respondent federation ULGWP. MSMG and the
company Greenfield entered into a CBA. The
CBA contains a Union Security Clause
providing that “any employee who fails to join
or maintain membership in the Union shall be
dismissed from the employment by the company
upon written recommendation to the company
by the Union.
Due to certain disagreements between the
MSMG and ULGWP regarding the collection of
certain fees from members, the MSMG declared
general autonomy from ULGWP thru a Board
Resolution which was later ratified by the
general membership.
Herein petitioners were later expelled from
ULGWP allegedly because of their acts of
disloyalty and/or acts inimical to the interest and
violative of the Constitution and By-laws of the
federation. On the same day, the federation
advised respondent company of the expulsion of
the 30 union officers and demanded their
separation from employment pursuant to the
Union Security Clause in their collective
bargaining agreement. The company then
dismissed the services of petitioners by bodily
removing them from the premises of the
company. This provoked some of the members
of the local union to demonstrate their protest
for the dismissal of the said union officers.
Some union members left their work posts and
walked out of the company premises. The
employees then staged a strike. The strike was
attended with violence, force and intimidation
on both sides resulting to physical injuries to
several employees, both striking and non-
striking, and damage to company properties.
The employees who participated in the strike
and allegedly figured in the violent incident
were placed under preventive suspension by
respondent company. The company also sent
return-to-work notices to the home addresses of
the striking employees thrice successively,
however only a handful of employees returned
to work. The company then dismissed the
employees who did not return to work for
abandonment.
The petitioners herein filed a complaint charging
private respondents of unfair labor practice
which consists of union busting, illegal
dismissal, illegal suspension, interference in
union activities, discrimination, threats,
intimidation, coercion, violence, and oppression.
Petitioners contend that their dismissal from
work was effected in an arbitrary, hasty,
capricious and illegal manner because it was
undertaken by the respondent company without
any prior administrative investigation; that, had
respondent company conducted prior
independent investigation it would have found
that their expulsion from the union was unlawful
similarly for lack of prior administrative
investigation; that the federation cannot
recommend the dismissal of the union officers
because it was not a principal party to the
collective bargaining agreement between the
company and the union.
Private respondents, on the other hand, maintain
that the thirty dismissed employees who were
former officers of the federation have no cause
of action against the company, the termination
of their employment having been made upon the
demand of the federation pursuant to the union
security clause of the CBA; the expelled officers
of the local union were accorded due process of
law prior to their expulsion from their
federation; that the strike conducted by the
petitioners was illegal for noncompliance with
the requirements; that the employees who
participated in the illegal strike and in the
commission of violence thereof were validly
terminated from work; that petitioners were
deemed to have abandoned their employment
when they did not respond to the three return to
work notices sent to them; that petitioner labor
union has no legal personality to file and
prosecute the case for and on behalf of the
individual employees as the right to do so is
personal to the latter; and that, the officers of
respondent company cannot be liable because as
mere corporate officers, they acted within the
scope of their authority.
ISSUES:
1) WON the employer can dismiss an employee
by virtue of the Union Security Clause without
investigating whether the employees were given
due process by the Union?
2) WON the act of disaffiliating from a
federation can be considered as an act of
disloyalty on the part of the local union?
3) WON the dismissal of an employee based on
the Union Security Clause of the CBA
constitutes ULP?
4) WON the employees in this case were validly
dismissed?
5) WON the strike stage by the employees was
illegal?
RULING:
1) No. As held the case of Carino v. National
Labor Relations Commission, "the right of an
employee to be informed of the charges against
him and to reasonable opportunity to present his
side in a controversy with either the company or
his own union is not wiped away by a union
security clause or a union shop clause in a
collective bargaining agreement. An employee is
entitled to be protected not only from a company
which disregards his rights but also from his
own union the leadership of which could yield to
the temptation of swift and arbitrary expulsion
from membership and mere dismissal from his
job." While respondent company may validly
dismiss the employees expelled by the union for
disloyalty under the union security clause of the
collective bargaining agreement upon the
recommendation by the union, this dismissal
should not be done hastily and summarily
thereby eroding the employees right to due
process, self-organization and security of tenure.
The enforcement of union security clauses is
authorized by law provided such enforcement is
not characterized by arbitrariness, and always
with due process. Even on the assumption that
the federation had valid grounds to expel the
union officers, due process requires that these
union officers be accorded a separate hearing by
respondent company.
2) No. A local union has the right to disaffiliate
from its mother union or declare its autonomy.
A local union, being a separate and voluntary
association, is free to serve the interests of all its
members including the freedom to disaffiliate or
declare its autonomy. A local union which has
affiliated itself with a federation is free to sever
such affiliation anytime and such disaffiliation
cannot be considered disloyalty. In the absence
of specific provisions in the federations
constitution prohibiting disaffiliation or the
declaration of autonomy of a local union, a local
may dissociate with its parent union from the
federation to which it belongs when
circumstances warrant, in accordance with the
constitutional guarantee of freedom of
association Here in the Constitution and By-
Laws of the federation, there is no specific
provision prohibiting disaffiliation or declaration
of autonomy by local unions.
3) No. Union security clauses in collective
bargaining agreements, if freely and voluntarily
entered into, are valid and binding. Corollary,
dismissals pursuant to union security clauses are
valid and legal subject only to the requirement
of due process, that is, notice and hearing prior
to dismissal. Thus, the dismissal of an employee
by the company pursuant to a labor unions
demand in accordance with a union security
agreement does not constitute unfair labor
practice.
4) No. The dismissal was invalidated in this case
because of respondent company’s failure to
accord petitioners with due process, that is,
notice and hearing prior to their termination.
Also, said dismissal was invalidated because the
reason relied upon by respondent Federation was
not valid. Nonetheless, the dismissal still does
not constitute unfair labor practice.
5) No, when respondent company dismissed the
union officers, the issue was transformed into a
termination dispute and brought respondent
company into the picture. Petitioners believed in
good faith that in dismissing them upon request
by the federation, respondent company was
guilty of unfair labor practice in that it violated
the petitioner’s right to self-organization. The
strike was staged to protest respondent
company’s act of dismissing the union officers.
Even if the allegations of unfair labor practice
are subsequently found out to be untrue, the
presumption of legality of the strike prevails.
Automotive Engine Rebuilders vs.
Progresibong Unyon ng mga Manggagawa sa
AER (2011)
In pari delicto in labor cases is a situation
which warrants the maintenance of the status
quo. This means that the contending parties
must be brought back to their respective
positions before the controversy; that is, before
the strike
FACTS: AER is an automotive engine repair
company. Progresibong Unyon is the legitimate
labor union of AER’s rank and file employees.
Both parties filed a complaint against each other
before the NLRC.
AER filed a complaint against Unyon and its 18
members for illegal concerted activities. It
likewise suspended 7 union members tested
positive for illegal drugs. AER claims that
Unyon was guilty of staging an illegal strike.
On the other hand, Unyon filed a counter
charge accusing AER of unfair labor
practice, illegal suspension and illegal
dismissal. Unyon claims that AER committed an
illegal lockout.
The dispute arose a day after the union filed a
petition for certification election before the
DOLE. At that time, AER required all its
employees to undergo a compulsory drug test.
Employees who were found positive for illegal
drugs were suspended thereafter. In protest of
the alleged illegal suspension, the complaining
workers staged a one day walkout.
Subsequently, AER dismissed concerned
employees as penalty for the alleged illegal
strike.
Likewise, AER had also pulled out machines
from the main building to the AER-PSC
compound located on another street.
Consequently, protesting employees forced their
way to the AER-PSC premises to try to bring
out the boring machine.
On appeal, CA decided to order reinstatement of
all suspended employees without back wages.
ISSUE: WON both parties guilty of in pari
delicto?
RULING: Yes.
It cannot be disputed that both parties filed
charges against each other, blaming the other
party for violating labor laws. AER filed a
complaint against Unyon and its 18 members for
illegal concerted activities. It likewise suspended
7 union members who tested positive for illegal
drugs. On the other hand, Unyon filed a
countercharge accusing AER of unfair labor
practice, illegal suspension and illegal dismissal.
In other words, AER claims that Unyon was
guilty of staging an illegal strike while Unyon
claims that AER committed an illegal lockout.
AERs fault is obvious from the fact that a day
after the union filed a petition for certification
election before the DOLE, it hit back by
requiring all its employees to undergo a
compulsory drug test. Although AER argues that
the drug test was applied to all its employees, it
was silent as to whether the drug test was a
regular company policy and practice in their 35
years in the automotive engine repair and
rebuilding business. As the Court sees it, it was
AERs first ever drug test of its employees
immediately implemented after the workers
manifested their desire to organize themselves
into a union. Indeed, the timing of the drug test
was suspicious.
The in pari delicto doctrine in labor cases is not
novel to us. It has been applied in the case of
Philippines Inter-Fashion, Inc. v NLRC,
where the Court held:
The Solicitor General has correctly stated in his
comment that "from these facts are derived the
following conclusions which are likewise
undisputed: that petitioner engaged in an illegal
lockout while the NAFLU engaged in an illegal
strike; that the unconditional offer of the 150
striking employees to return to work and to
withdraw their complaint of illegal lockout
against petitioner constitutes condonation of the
illegal lock-out; and that the unqualified
acceptance of the offer of the 150 striking
employees by petitioner likewise constitutes
condonation of the illegal strike insofar as the
reinstated employees are concerned."
The issues at bar arise, however, from
respondent commission's approval of its
commissioner's conclusions that (1) petitioner
must be deemed to have waived its right to
pursue the case of illegal strike against the 114
employees who were not reinstated and who
pursued their illegal lockout claim against
petitioner; and (2) the said 114 employees are
entitled to reinstatement with three months'
backwages.
The Court approves the stand taken by the
Solicitor General that there was no clear and
unequivocal waiver on the part of petitioner and
on the contrary the record shows that it
tenaciously pursued its application for their
dismissal, but nevertheless in view of the
undisputed findings of illegal strike on the part
of the 114 employees and illegal lockout on
petitioner's part, both parties are in pari delicto
and such situation warrants the restoration of
the status quo ante and bringing the parties
back to the respective positions before the
illegal strike and illegal lockout through the
reinstatement of the said 114 employees, as
follows:
The Bisaya case (102 Phil. 438) is inapplicable
to the present case, because in the former, there
were only two strikers involved who were both
reinstated by their employer upon their request
to return to work. However, in the present case,
there were more than 200 strikers involved, of
which 150 who desired to return to work were
reinstated. The rest were not reinstated because
they did not signify their intention to return to
work. Thus, the ruling cited in the Bisaya case
that the employer waives his defense of illegality
of the strike upon reinstatement of strikers is
applicable only to strikers who signified their
intention to return to work and were accepted
back ...
Truly, it is more logical and reasonable for
condonation to apply only to strikers who
signified their intention to return and did return
to work. The reason is obvious. These strikers
took the initiative in normalizing relations with
their employer and thus helped promote
industrial peace. However, as regards the
strikers who decided to pursue with the case, as
in the case of the 114 strikers herein, the
employer could not be deemed to have condoned
their strike, because they had not shown any
willingness to normalize relations with it. So, if
petitioner really had any intention to pardon the
114 strikers, it would have included them in its
motion to withdraw on November 17, 1980. The
fact that it did not, but instead continued to
pursue the case to the end, simply means that it
did not pardon the 114 strikers.
xxx xxx xxx
The finding of illegal strike was not disputed.
Therefore, the 114 strikers employees who
participated therein are liable for termination
(Liberal Labor Union v. Phil. Can Co., 91 Phil.
72; Insurefco Employees Union v. Insurefco, 95
Phil. 761). On the other hard, the finding of
illegal lockout was likewise not disputed.
Therefore, the 114 employees affected by the
lockout are also subject to reinstatement.
Petitioner, however, contends that the
application for readmission to work by the 150
strikers constitutes condonation of the lockout
which should likewise bind the 114 remaining
strikers. Suffice it to say that the 150 strikers
acted for themselves, not on behalf of the 114
remaining strikers, and therefore the latter
could not be deemed to have condoned
petitioner's lockout.
The findings show that both petitioner and the
114 strikers are in pari delicto, a situation
which warrants the maintenance of the status
quo. This means that the contending parties
must be brought back to their respective
positions before the controversy; that is, before
the strike. Therefore, the order reinstating the
114 employees is proper.
With such restoration of the status quo ante it
necessarily follows, as likewise submitted by the
Solicitor General, that the petition must be
granted insofar as it seeks the setting aside of
the award of three months' backwages to the
114 employees ordered reinstated on the basis
of the general rule that strikers are not entitled
to backwages (with some exceptions not herein
applicable, such as where the employer is guilty
of oppression and union-busting activities and
strikers ordered reinstated are denied such
reinstatement and therefore are declared
entitled to backwages from the date of such
denial). More so, is the principle of "no work,
no pay" applicable to the case at bar, in view of
the undisputed finding of illegality of the strike.
Both AER and Unyon are at fault or in pari
delicto, thus, they should be restored to their
respective positions prior to the illegal strike and
illegal lockout. Nonetheless, if reinstatement is
no longer feasible, the concerned employees
should be given separation pay up to the date set
for the return of the complaining employees in
lieu of reinstatement.
Petitions denied
CLLC E.G. Gochangco Workers Union vs.
NLRC (1988)
ULP cases are not, in view of the public interest
involved, subject to compromises.
FACTS: Petitioner CCLC E.G. Gochangco
Workers Union is a local chapter of the Central
Luzon Labor Congress (CLLC), a legitimate
labor federation duly registered with the
Ministry of Labor and Employment (MOLE),
while the individual petitioners are former
employees of private respondent who were
officers and members of the petitioner union.
Majority of the rank and file employees of
respondent firm organized the e.g. Gochangco
Workers Union as an affiliate of the CLLC.
Union filed a petition for certification
CLLC national president wrote the general
manager of respondent firm informing him of
the organization of the union and requesting for
a labor management conference to normalize
employer-employee relations
Union sent a written notice to respondent firm
requesting permission for certain member
officers and members of the union to attend the
hearing of the petition for certification election.
The management refused to acknowledge receipt
of said notice
Private respondent preventively suspended the
union officers and members who attended the
hearing. The common ground alleged by private
respondent for its action was "abandonment of
work on February 27, 1980." On the same date,
all the gate passes of all the above-mentioned
employees to Clark Air Base were confiscated
by a Base guard.
Claiming that private respondent instigated the
confiscation of their gate passes to prevent them
from performing their duties and that respondent
firm did not pay them their overtime pay, 13th
month pay and other benefits, petitioner union
and its members filed a complaint for
constructive lockout and unfair labor practice
against private respondent.
Private respondent filed an application for
clearance to dismiss the union officers and
members
Petitioner Ricardo Dormingo who was
preventively suspended, filed a complaint for
ULP. Services of 9 more union members were
terminated by private respondent on the ground
that its contract with the U.S. Air Force had
expired. The 9 employees filed a complaint for
illegal dismissal against private respondents
Private respondent filed with MOLE a Notice of
Termination of Contract together with a list of
employees affected by the expiration of the
contract, among them, the 39 individual
petitioners herein.
LA ordered: To reinstate all the
suspended/dismissed employees to their former
positions without loss of seniority rights and
other privileges, with full backwages including
cost of emergency living allowance from the
date of their suspension/dismissal up to the
supposed date of actual reinstatement
NLRC: set aside the decision of the LA; granted
the application for clearance to terminate the
services of individual complainants-appellees
filed by respondent-appellant.
ISSUE: WON petitioners waived their
economic demands, as alleged by private
respondent, by way of compromise?
RULING:
NO.
We are convinced that the respondent company
is indeed guilty of an ULP. It is no coincidence
that at the time said respondent issued its
suspension and termination orders, the
petitioners were in the midst of a certification
election preliminary to a labor management
conference, purportedly, "to normalize
employer-employee relations." It was within the
legal right of the petitioners to do so, the
exercise of which was their sole prerogative, and
in which management may not as a rule
interfere. In this connection, the respondent
company deserves our strongest condemnation
for ignoring the petitioners' request for
permission for some time out to attend to the
hearing of their petition before the med-arbiter.
It is not only an act of arrogance, but a brazen
interference as well with the employees’ right to
self-organization, contrary to the prohibition of
the Labor Code against unfair labor practices.
In finding the petitioners' suspension illegal,
with more reason do we hold their subsequent
dismissal to be illegal. We are not persuaded by
the respondent firm's argument that final
termination should be effected as the contract
has expired. What impresses us is the Solicitor
General's submission that the petitioners were
regular employees and as such, their tenure did
not end with the expiration of the contract.
The Court rejects the claims of an alleged
waiver by the petitioners of their economic
demands, in the light of an alleged order issued
by Labor Arbiter Aquino in connection with
another case(s) involving the same parties. (It
was Labor Arbiter Federico Bernardo who
penned the unfair labor practice/illegal dismissal
case.)
The Honorable Aquino's disposition reads:
The records show that a "Waiver of Claims,
Rights and Interest" was filed by above-named
petitioners stating, among other things, that said
petitioners are waiving their claims, rights and
interests against the respondents.
ACCORDINGLY, let the above-entitled cases be
DISMISSED in view of the waiver made by the
petitioners.  Furthermore, these alleged waivers do not
Acting on these allegations, the respondent
Commission, baring its clear bias for
management, ruled that the petitioners had
waived their claims. Thus:
xxx xxx xxx
With respect to the second issue, that is, whether
or not the waiver of rights and interests
executed by Fernando do so, 6 The G Lising,
Odilon do so, 6 The G Lising, Jose C. Tiamzon,
Ernesto Tuazon, Pedro Santos, Ruben Buela,
Eduardo Alegado, Estrael Vino, Rogelio
Manguerra, Edilberto Bingcang, Olimpio
Gumin, Leo Tropico, Orlando Nacu, Rodolfo T.
Capitly and Juanito Suba, are valid, the alleged
president of complainant-appellee union
Benigno Navarro, Sr., contends that Id Atty.
Solomon has no authority to appear floor and in
behalf of individual complainants-appellees who
waived their rights and interests in these cases
since there was no authority from him. Records,
however, disclose that said Atty. Solomon had
been the attorney of record for complainants-
appellees since the inception of these cases, and,
therefore, is authority to represent them cannot
be questioned- not even by Ministry. Navarro
who allegedly took over the presidency of
complainant-appellee union after the
disappearance of the former president, Mr.
Ficardo Alconga, Sr. And besides, the waiver of
rights and interests were personally executed by
the signatories therein and all that Atty.
Solomon did was to assist them.
xxx xxx xxx
We find this puzzling for clearly, Labor Arbiter
Aquino's resolution refers to other cases and not
the instant unfair labor practice controversy. The
Commission cannot feign simple mistake for
such a lapse. In any event, we have held that
ULP cases are not, in view of the public
interest involved, subject to compromises.
appear to have been presented in the first
instance. They cannot be introduced for the first
time on appeal.
Interphil Laboratories Employees Union vs.
Interphil Laboratories (2001)
In the present case, the Secretary was explicitly
granted by Article 263(g) of the Labor Code the
authority to assume jurisdiction over a labor
dispute causing or likely to cause a strike or
lockout in an industry indispensable to the
national interest, and decide the same
accordingly. Necessarily, this authority to
assume jurisdiction over the said labor dispute
must include and extend to all questions and
controversies arising therefrom, including cases
over which the labor arbiter has exclusive
jurisdiction.
Moreover, Article 217 of the Labor Code is not
without, but contemplates, exceptions thereto.
This is evident from the opening proviso therein
reading ‘(e)xcept as otherwise provided under
this Code x x x.’ Plainly, Article 263(g) of the
Labor Code was meant to make both the
Secretary (or the various regional directors)
and the labor arbiters share jurisdiction, subject
to certain conditions. Otherwise, the Secretary
would not be able to effectively and efficiently
dispose of the primary dispute. To hold the
contrary may even lead to the absurd and
undesirable result wherein the Secretary and the
labor arbiter concerned may have diametrically
opposed rulings. As we have said, ‘it is
fundamental that a statute is to be read in a
manner that would breathe life into it, rather
than defeat it.
FACTS: Petitioner is the sole and exclusive
bargaining agent of the rank-and-file employees
of Respondent. They had a CBA. Prior to the
expiration of the CBA, respondent company was
approached by the petitioner, through its
officers. The Union inquired about the stand of
the company regarding the duration of the CBA
which was set to expire in a few months. Salazar
told the union officers that the matter could be
best discussed during the formal negotiations
which would start soon.
All the rank-and-file employees of the company
refused to follow their regular two-shift work
schedule. The employees stopped working and
left their workplace without sealing
the containers and securing the raw materials
they were working on.
To minimize the damage the overtime boycott
was causing the company, Salazar
immediately asked for a meeting with the union
officers. In the meeting, Enrico Gonzales, a
union director, told Salazar that the employees
would only return to their normal work schedule
if the company would agree to their demands as
to the effectivity and duration of the new CBA.
Salazar again told the union officers that the
matter could be better discussed during the
formal renegotiations of the CBA. Since the
union was apparently unsatisfied with the
answer of the company, the
overtime boycott continued. In addition, the
employees started to engage in a work
slowdown campaign during the time they were
working, thus substantially delaying the
production of the company.
Respondent company filed with the National
NLRC a petition to declare illegal
petitioner union’s “overtime boycott” and “work
slowdown” which, according to respondent
company, amounted to illegal strike. It also filed
with Office Secretary of Labor a petition for
assumption of jurisdiction. Secretary of Labor
Nieves Confesor issued an assumption order
over the labor dispute.
Labor Arbiter Caday submitted his
recommendation to the then Secretary of Labor
Leonardo A. Quisumbing. Then Secretary
Quisumbing approved and adopted the report in
his Order, finding illegal strike on the part of
petitioner Union.
ISSUE: WON the Labor Secretary has
jurisdiction to rule over an illegal strike.
RULING: Yes.
On the matter of the authority and jurisdiction of
the Secretary of Labor and Employment to rule
on the illegal strike committed by petitioner
union, it cannot be denied that the issues of
“overtime boycott” and “work slowdown”
amounting to illegal strike before Labor Arbiter
Caday are intertwined with the labor dispute
before the Labor Secretary.
The appellate court also correctly held that the
question of the Secretary of Labor
and Employment’s jurisdiction over labor-
related disputes was already settled in
International Pharmaceutical, Inc. vs. Hon.
Secretary of Labor and Associated Labor
Union (ALU) where the Court declared:
In the present case, the Secretary was explicitly
granted by Article 263(g) of the Labor Code the
authority to assume jurisdiction over a labor
dispute causing or likely to cause a strike or
lockout in an industry indispensable to the
national interest, and decide the same
accordingly. Necessarily, this authority to
assume jurisdiction over the said labor dispute
must include and extend to all questions and
controversies arising therefrom, including cases
over which the labor arbiter has exclusive
jurisdiction.
Moreover, Article 217 of the Labor Code is not
without, but contemplates, exceptions thereto.
This is evident from the opening proviso therein
reading ‘(e)xcept as otherwise provided under
this Code x x x.’ Plainly, Article 263(g) of the
Labor Code was meant to make both the
Secretary (or the various regional directors)
and the labor arbiters share jurisdiction,
subject to certain conditions. Otherwise, the
Secretary would not be able to effectively
and efficiently dispose of the primary dispute.
To hold the contrary may even lead to the
absurd and undesirable result wherein the
Secretary and the labor arbiter concerned may
have diametrically opposed rulings. As we have
said, ‘it is fundamental that a statute is to be
read in a manner that would breathe life into it,
rather than defeat it.
In fine, the issuance of the assailed orders is
within the province of the Secretary as
authorized by Article 263(g) of the Labor Code
and Article 217(a) and (5) of the same Code,
taken conjointly and rationally construed to
subserve the objective of the jurisdiction vested
in the Secretary.
Liwayway Publications Inc. vs. Permanent
Concrete Workers Union (1981) (Sub-lessee,
Innocent Bystander Rule)
While peaceful picketing is entitled to protection
as an exercise of free speech, we believe that
courts are not without power to confine or
localize the sphere of communication or the
demonstration to the parties to the labor
dispute, including those with related interest,
and to insulate establishments or persons with
no industrial connection or having interest
totally foreign to the context of the dispute.
Thus, the right may be regulated at the instance
of third parties or "innocent bystanders" if it
appears that the inevitable result of its exercise
is to create an impression that a labor dispute
with which they have no connection or interest
exists between them and the picketing union or
constitute an invasion of their rights
FACTS: Plaintiff alleged that it is a second sub-
lessee of a part of the premises of the Permanent
Concrete Products, Inc. Their premises are
separated by a concrete and barbed wire fence
with its own entrance and road leading to the
national road. This entrance is separate and
distinct from the entrance road of PCPI. The
daily supply of newsprint needed to feed its
printing plant is taken from this bodega.
PCPI employees, who are representatives and
members of the Union declared a strike against
the company. Less than a month later, Union
members picketed, stopped and prohibited
plaintiff's truck from entering the compound to
load newsprint from its bodega. The union
members intimidated and threatened with bodily
harm the employees who were in the truck. They
also stopped and prohibited the general manager,
personnel manager, bodega-in-charge and other
employees of the plaintiff from getting
newsprint in their bodega. Despite pleas to stop
intimidating and threatening Plaintiff’s
employees, the Union continued their acts.
As a consequence thereof, plaintiff rented
another bodega during the time members of the
defendant union prevented its employees from
entering its bodega in the compound of
Permanent Concrete Products, Inc. and thus
incurred expenses both in terms of bodega
rentals and in transporting newsprint from the
pier to the temporary bodega.
Plaintiff then brought an action for the issuance
of a writ of preliminary injunction and for
damages against the union. The Lower Court
issued the writ of preliminary injunction for the
Union to stop threatening and intimidating
Plaintiff’s employees. The Union filed Motion
to Dismiss because the CFI had no jurisdiction
over the ULP and that Plaintiff is not the real
party in interest. Plaintiff opposed by saying that
there is no ER-EE relation, no labor dispute and
that Plaintiff’s compound is separate and distinct
from the Union’s place of employment.
Lower Court: denied the motion to dismiss and
motion to dissolve writ on the ground that there
was no labor dispute between the plaintiff and
defendant of which the Court of Industrial
Relations may take cognizance.
The Union was declared in default and the writ
of preliminary injunction was made permanent.
Plaintiff then filed with the Supreme Court a
petition praying that a writ of attachment be
issued on any sum of money which may be used
to satisfy the judgment. SC denied but without
prejudice to same petition with the CFI.
ISSUE: WON the lower court has jurisdiction to
issue a Writ of Preliminary Injunction
considering that there was a labor dispute
between Permanent Concrete Products, Inc. and
appellants for alleged unfair labor practices
committed by the former?
RULING: Yes. Appellee is not in any way
related to the striking union except for the fact
that it is the sub-lessee of a bodega in the
company's compound. The business of the
appellee is exclusively the publication of the
magazines Bannawag Bisaya, Hiligaynon and
Liwayway weekly magazines which has
absolutely no relation or connection whatsoever
with the cause of the strike of the union against
their company, much less with the terms,
conditions or demands of the strikers. In such a
factual situation, the query to be resolved is
whether the appellee is a third party or an
"innocent bystander" whose right has been
invaded and, therefore, entitled to protection by
the regular courts.
While peaceful picketing is entitled to protection
as an exercise of free speech, we believe that
courts are not without power to confine or
localize the sphere of communication or the
demonstration to the parties to the labor dispute,
including those with related interest, and to
insulate establishments or persons with no
industrial connection or having interest totally
foreign to the context of the dispute. Thus, the
right may be regulated at the instance of third
parties or "innocent bystanders" if it appears that
the inevitable result of its exercise is to create an
impression that a labor dispute with which they
have no connection or interest exists between
them and the picketing union or constitute an
invasion of their rights.
It may be conceded that the appellant Union has
a labor dispute with the Permanent Concrete
Products Company and that the dispute is
pending before the Court of Industrial Relations
We find and hold that there is no connection
between the appellee Liwayway publications,
Inc. and the striking Union, nor with the
company against whom the strikers staged the
strike, and neither are the acts of the driver of
the appellee, its general manager, personnel
manager, the man in-charge of the bodega and
other employees of the appellee in reaching the
bodega to obtain newsprint therefrom to feed
and supply its publishing business interwoven
with the labor dispute between the striking
Union and the Permanent Concrete Products
company. Being situated in the same premises
does not mean being interwoven.
The acts complained of against the striking
union members are properly called mere acts of
trespass (perturbacion de mero hecho) such that
following the doctrine laid down in Goldstein
vs. Roces, the lessor shall not be obliged to
answer for the mere fact of a trespass
(perturbacion de mero hecho) made by a third
person in the use of the estate leased but the
lessee shag have a direct action against the
trespasser.
Wise and Co. Inc. vs. Wise and Co. Inc.
Employees Union-NATU ETC. (1989)
Discrimination per se is not unlawful. There can
be no discrimination where employees
concerned are not similarly situated. The grant
of the employer of profit- sharing benefits to the
employees outside the “bargaining unit” falls
under the ambit of its managerial prerogative. It
appears to have been done in good faith and
without ulterior motive. More so when as in this
case there is a clause in the CBA where the
employees are classified into those who are
members of the union and those who are not.
FACTS: When the management introduced a
profit-sharing scheme for its managers and
supervisors, the union wrote the management to
ask that the union members be allowed to
participate in the profit- sharing program. The
management denied the request on the ground
that such participation was not provided in the
CBA. Later, when the renegotiation of the CBA
was approaching, the management wrote the
union that it was willing to consider including
the union members in the profit- sharing scheme
if the negotiations would be concluded before
December 1987.
On March 30, 1988, the company distributed the
profit- sharing benefit not only to managers and
supervisors but also to all rank-and-file
employees not covered by the CBA because they
were excluded from their agreed definition of
bargaining unit, such as the regular rand-and-file
employees in the office of the president, vice
president, security office, corporate affairs
office, accounting and treasury department.
ISSUE: WON the grant by the management of
profit- sharing benefits to its employees who are
non-union members is discriminatory against the
union members which amount to ULP?
RULING: No. There can be no discrimination
committed by the employer as the situation of
the union employees is different from the non
union employees. Discrimination per se is not
unlawful. There can be no discrimination where
employees concerned are not similarly situated.
The grant of the employer of profit- sharing
benefits to the employees outside the
“bargaining unit” falls under the ambit of its
managerial prerogative. It appears to have been
done in good faith and without ulterior motive.
More so when as in this case there is a clause in
the CBA where the employees are classified into
those who are members of the union and those
who are not. In the case of the union members,
they derive their benefits from the terms and
conditions of the CBA which constitutes the law
between the contracting parties. Both the
employer and the union members are bound by
such agreement. However, the Court serves
notice that it will not hesitate to strike down any
act of the employer that tends to be
discriminatory against union members. It is only
because of the peculiar circumstances of this
case showing there is no such intention that this
court has ruled otherwise.
Meralco vs. Quisimbing (Feb 2000)
In general, a CBA negotiated within six months
after the expiration of the existing CBA
retroacts to the day immediately following such
date and if agreed thereafter, the effectivity
depends on the agreement of the parties. On the
other hand, the law is silent as to the
retroactivity of a CBA arbitral award or that
granted not by virtue of the mutual agreement of
the parties but by intervention of the
government. Despite the silence of the law, the
Court rules herein that CBA arbitral awards
granted after six months from the expiration of
the last CBA shall retroact to such time agreed
upon by both employer and the employees or
their union. Absent such an agreement as to
retroactivity, the award shall retroact to the first
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
Secretary's determination of the date of
retroactivity as part of his discretionary powers
over arbitral awards shall control.
FACTS: In 1999, the Supreme Court
promulgated a decision directing the parties to
execute a CBA which provided for increase in
wages and retroactive application of arbitral
awards. MERALCO filed this petition arguing
that an increase in wages will result in higher
rates of electricity which will be passed to the
consumers. The Union likewise asks for
reconsideration insofar as the 1999 decision
which denied them the benefit of being granted
loans to set up a cooperative. Finally, the Union
questions the right given to MERALCO in
contracting out jobs without need to consult the
Union.
ISSUES:
1) WON the increase in wages will result in
higher prices of electricity?
2) WON the grant of Collective Bargaining
Agreement (CBA) arbitral awards retroactive?
3) WON the cooperative may demand for the
loan for a cooperative?
4) WON contracting without need to consult the
Union is a valid provision?
RULING:
1) ON THE INCREASE IN WAGES
No, it doesn’t follow. An increase in the prices
of electric current needs the approval of the
appropriate regulatory government agency and
does not automatically result from a mere
increase in the wages of petitioner's employees.
Collective bargaining disputes particularly those
affecting the national interest and public service
"requires due consideration and proper
balancing of the interests of the parties to the
dispute and of those who might be affected by
the dispute. It should be noted that the relations
between labor and capital is impressed with
public interest which must yield to the common
good. Neither party should act oppressively
against the other or impair the interest or
convenience of the public. Besides, matters of
salary increases are part of management
prerogative.
2) ON THE RETROACTIVITY OF
ARBITRAL AWARDS
Labor laws are silent as to when an arbitral
award in a labor dispute where the Secretary had
assumed jurisdiction by virtue of Article 263 (g)
of the Labor Code shall retroact. In general, a
CBA negotiated within six months after the
expiration of the existing CBA retroacts to the
day immediately following such date and if
agreed thereafter, the effectivity depends on the
agreement of the parties. On the other hand, the
law is silent as to the retroactivity of a CBA
arbitral award or that granted not by virtue of the
mutual agreement of the parties but by
intervention of the government. Despite the
silence of the law, the Court rules herein that
CBA arbitral awards granted after six months
from the expiration of the last CBA shall
retroact to such time agreed upon by both
employer and the employees or their union.
Absent such an agreement as to retroactivity, the
award shall retroact to the first 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 Secretary's determination
of the date of retroactivity as part of his
discretionary powers over arbitral awards shall
control.
3) ON COOPERATIVE’S DEMAND FOR
LOAN
On the allegation concerning the grant of loan to
a cooperative, there is no merit in the union's
claim that it is no different from housing loans
granted by the employer. The award of loans for
housing is justified because it pertains to a basic
necessity of life. It is part of a privilege
recognized by the employer and allowed by law.
In contrast, providing seed money for the
establishment of the employee's cooperative is a
matter in which the employer has no business
interest or legal obligation. Courts should not be
utilized as a tool to compel any person to grant
loans to another nor to force parties to undertake
an obligation without justification.
4) ON CONTRACTING WITHOUT
CONSULTING THE UNION
The employer is allowed to contract out services
for six months or more. However, a line must be
drawn between management prerogatives
regarding business operations per se and those
which affect the rights of employees, and in
treating the latter, the employer should see to it
that its employees are at least properly informed
of its decision or modes of action in order to
attain a harmonious labor-management
relationship and enlighten the workers
concerning their rights.
Hiring of workers is within the employer's
inherent freedom to regulate and is a valid
exercise of its management prerogative subject
only to special laws and agreements on the
matter and the fair standards of justice. The
management cannot be denied the faculty of
promoting efficiency and attaining economy by
a study of what units are essential for its
operation. It has the ultimate determination of
whether services should be performed by its
personnel or contracted to outside agencies.
While there should be mutual consultation,
eventually deference is to be paid to what
management decides. Contracting out of
services is an exercise of business judgment or
management prerogative. Absent proof that
management acted in a malicious or arbitrary
manner, the Court will not interfere with the
exercise of judgment by an employer.
Meralco vs. Quisimbing (Aug 2000)
FACTS: Petitioner Manila Electric Company
filed with this Court, a "Motion for Partial
Modification (Re: Resolution Dated 22 February
2000)" anchored on the following grounds:
I. Honorable Court’s ruling on the retroactivity
issue: (a) fails to account for previous rulings of
the Court on the same issue; (b) fails to indicate
the reasons for reversing the original ruling in
this case on the retroactivity issue; and (c) is
internally inconsistent.
II. Honorable Court’s ruling on the retroactivity
issue does not take into account the huge cost
that this award imposes on petitioner, estimated
at no less than P800 Million.
Petitioner specifically assails the Resolution as
being logically flawed, arguing,
First, that while it alludes to the Secretary’s
discretionary powers only in the absence of a
CBA, Article 253-A of the Labor Code always
presupposes the existence of a prior or
subsisting CBA; hence the exercise by the
Secretary of his discretionary powers will never
come to pass.
Second, petitioner contends that this Court erred
in holding that the effectivity of CBA provisions
are automatically retroactive. Petitioner invokes,
rather, this Court’s ruling in the Decision dated
January 27, 1999, which was modified in the
assailed Resolution, that in the absence of an
agreement between the parties, an arbitrated
CBA takes on the nature of any judicial or
quasi-judicial award; it operates and may be
executed only prospectively unless there are
legal justifications for its retroactive application.
Third, petitioner contends that the Resolution is
internally flawed because when it held that the
award shall retroact to the first day after the six-
month period following the expiration of the last
day of the CBA, the reckoning date should have
been June 1, 1996, not December 1, 1995, which
is the last day of the three-year lifetime of the
economic provisions of the CBA.
The petitioner also prays that the two-year term
of the CBA be fixed from December 28, 1996 to
December 27, 1998 since the application of the
arbitral award will cost it no less than P800
Million. Petitioner also seeks this Court’s
declaration that the award of P2,000.00 be paid
to petitioner’s rank-and-file employees during
this two-year period. In the alternative,
petitioner prays that the award of P2,000.00 be
made to retroact to June 1, 1996 as the
effectivity date of the CBA.
ISSUES:
1) WON Art. 253-A of the Labor Code applies
in this case?
2) WON collective bargaining agreement shall
take effect only upon its signing and shall
remain in full force and effect for a period of
five years?
RULING:
1) No. Article 253-A is hereunder reproduced
for ready reference:
ART. 253-A. Terms of a collective bargaining
agreement. --- Any Collective Bargaining
Agreement that the parties may enter into shall,
insofar as the representation aspect is
concerned, be for a term of five (5) years. No
petition questioning the majority status of the
incumbent bargaining agent shall be entertained
and no certification election shall be conducted
by the Department of Labor and Employment
outside of the sixty-day period immediately
before the date of expiry of such five year term
of the Collective Bargaining Agreement. All
other provisions of the Collective Bargaining
Agreement shall be renegotiated not later than
three (3) years after its execution. Any
agreement on such other provisions of the
Collective Bargaining Agreement entered into
within six (6) months from the date of expiry of
the term of such other provisions as fixed in
such Collective Bargaining Agreement, shall
retroact to the day immediately following such
date. If any such agreement is entered into
beyond six months, the parties shall agree on
the duration of retroactivity thereof. In case of
a deadlock in the renegotiation of the collective
bargaining agreement, the parties may exercise
their rights under this Code.
Under the circumstances of the case, Article
253-A cannot be properly applied to herein case.
As correctly stated by public respondent in his
assailed Order of April 12, 1991 dismissing
petitioner’s Motion for Reconsideration –
Anent the alleged lack of basis for the
retroactivity provisions awarded, we would
stress that the provision of law invoked by the
Hospital, Article 253-A of the Labor Code,
speaks of agreements by and between the
parties, and not arbitral awards . . . (p. 818
Rollo).
Therefore, in the absence of a specific provision
of law prohibiting retroactivity of the effectivity
of arbitral awards issued by the Secretary of
Labor pursuant to Article 263(g) of the Labor
Code, such as herein involved, public
respondent is deemed vested with plenary and
discretionary powers to determine the effectivity
thereof (223 SCRA 779, 792-793 [1993];
reiterated in Philippine Airlines, Inc. v.
Confessor 231 SCRA 41 [1994]). Indeed,
petitioner has not shown that the question of
effectivity was not included in the general
agreement of the parties to submit their dispute
for arbitration. To the contrary, as the order of
the labor arbiter states, this question was among
those submitted for arbitration by the parties.
2. As regards the "Effectivity and Duration"
clause, the company proposes that the collective
bargaining agreement shall take effect only upon
its signing and shall remain in full force and
effect for a period of five years. The union
proposes that the agreement shall take effect
retroactive to March 15, 1989, the expiration
date of the old CBA.
And after an evaluation of the parties’ respective dictates of fairness and equitable justice and thus
contention and argument thereof, it is believed arrived at a formula that would address the
that of the union is fair and reasonable. It is the concerns of both sides. Hence, this Court held
observation of this Arbitrator that in almost that the arbitral award in this case be made to
subsequent CBAs, the effectivity of the retroact to the first day after the six-month
renegotiated CBA, usually and most often is period following the expiration of the last day of
made effective retroactive to the date when the the CBA, i.e., from June 1, 1996 to May 31,
immediately preceding CBA expires so as to 1998. This Court, therefore, maintains the
give a semblance of continuity. Hence, for this foregoing rule in the assailed Resolution pro hac
particular case, it is believed that there is vice. It must be clarified, however, that
nothing wrong adopting the stand of the union, consonant with this rule, the two-year effectivity
that is that this CBA be made retroactive period must start from June 1, 1996 up to May
effective March 15, 1989. 31, 1998, not December 1, 1995 to November
30, 1997.
Parenthetically, the Decision rendered in the
case at bar on January 27, 1999 ordered that the
CBA should be effective for a term of two years
counted from December 28, 1996 (the date of
the Secretary of Labor’s disputed Order on the
parties’ motion for reconsideration) up to
December 27, 1998. That is to say, the arbitral
award was given prospective effect. Upon a
reconsideration of the Decision, this Court
issued the assailed Resolution which ruled that
where an arbitral award granted beyond six
months after the expiration of the existing CBA,
and there is no agreement between the parties as
to the date of effectivity thereof, the arbitral
award shall retroact to the first day after the six-
month period following the expiration of the last
day of the CBA. In the dispositive portion,
however, the period to which the award shall
retroact was inadvertently stated as beginning on
December 1, 1995 up to November 30, 1997.

In resolving the motions for reconsideration in

this case, this Court took into account the fact
that petitioner belongs to an industry imbued
with public interest. As such, this Court cannot
ignore the enormous cost that petitioner will
have to bear as a consequence of the full
retroaction of the arbitral award to the date of
expiry of the CBA, and the inevitable effect that
it would have on the national economy. On the
other hand, under the policy of social justice, the
law bends over backward to accommodate the
interests of the working class on the humane
justification that those with less privilege in life
should have more in law. Balancing these two
contrasting interests, this Court turned to the