G.R. NO.

158075 June 30, 2006

PHILIPPINE DIAMOND HOTEL AND RESORT, INC. (MANILA

DIAMOND HOTEL), Petitioner, v. MANILA DIAMOND HOTEL
EMPLOYEES UNION, Respondent.

FACTS: There was a failure to settle the dispute regarding the bargaining
capability of the union, the union went on to file a notice of strike due to
unfair labor practice (ULP) in that the hotel refused to bargain with it and
the rank-and-file employees were being harassed and prevented from
joining it.

After several conferences, the union suddenly went on strike. The

following day, the National Union of Workers in the Hotel, Restaurant and
Allied Industries (NUWHRAIN) joined the strike and openly extended its
support to the union. The some of the entrances were blocked by the
striking employees. The National Labour Relations Commission (NLRC)
representative who conducted an ocular inspection of the Hotel premises
confirmed in his Report that the strikers obstructed the free ingress to and
egress from the Hotel. The NLRC thus issued a Temporary Restraining
Order (TRO) directing the strikers to immediately “cease and desist from
obstructing the free ingress and egress from the Hotel premises. During
the implementation of the order, the striking employees resisted and some
of the guards tasked to remove the barricades were injured

ISSUE: Whether or not the dismissal of the union members is valid?

HELD: Yes, even if the purpose of a strike is valid, the strike may still be
held illegal where the means employed are illegal. Thus, the employment
of violence, intimidation, restraint or coercion in carrying out concerted
activities which are injurious to the rights to property renders a strike
illegal. And so is picketing or the obstruction to the free use of property or
the comfortable enjoyment of life or property, when accompanied by
intimidation, threats, violence, and coercion as to constitute nuisance.

The SC upheld the appellate court’s decision, it ruled that the union officers
should be dismissed for staging and participating in the illegal strike,
following paragraph 3, Article 264(a) of the Labor Code which provides
that “. . .any union officer who knowingly participates in an illegal strike
and any worker or union officer who knowingly participates in the
commission of illegal acts during strike may be declared to have lost his
employment status . . .”
Fil Oil Refinery Corp. vs. Fil Oil Supervisory & Confidential Employees
Association and Court of Industrial Relations
G.R. No. L-26736 August 18, 1972
FACTS: Respondent association is composed exclusively of the supervisory
and confidential employees of petitioner corporation. There exists another
entirely distinct labor association composed of the corporation’s rank-and-
file employees, the Filoil Employees & Workers Association (FEWA) with
which petitioner executed a collective bargaining agreement. This
collective bargaining agreement expressly excluded from its coverage
petitioner’s supervisory and confidential employees, who in turn organized
their own labor association, respondent herein.
Respondent association filed on February 18, 1965 with the industrial court
its petition for certification as the sole and exclusive collective bargaining
agent of all of petitioner’s supervisory and confidential employees working
at its refinery in Rosario, Cavite.
ISSUE: Whether the respondent Supervisors (and confidential employees)
may form a labor organization and enjoy right to collective bargaining?
HELD: Yes. Supervisors (and confidential employees), even though they
may exercise the prerogatives of management as regards the rank and file
employees are indeed employees in relation to their employer, the
company which is owned by the stockholders and bondholders (capital)
and should therefore be entitled under the law to bargain collectively with
the top management with respect to their terms and conditions of
employment.
As stated for the SC in AG & P Co. of Manila, Inc. vs. C.I.R., section 3 of the
Industrial Peace Act “explicitly provides that “employees” — and this term
includes supervisors — “shall have the right to self-organization, and to
form, join or assist labor organizations of their own choosing for the
purpose of collective bargaining through representations of their own
choosing and to engage in concerted activities for the purpose of collective
bargaining and other mutual aid or protection” and that “individuals
employed as supervisors … may form separate organizations of their own”.
For this reason, supervisors are entitled to engage in union activities and
any discrimination against them by reason thereof constitutes an unfair
labor practice.
Philippine Scout Veterans Security vs Torres
G.R. No. 92357 July 21, 1993
FACTS: On April 6, 1989, private respondent labor union, PGA
Brotherhood Association – Union of Filipino Workers (UFW), hereinafter
referred to as “the Union ” filed a petition for Direct
Certification/Certification Election among the rank and file employees of
Philippine Scout Veterans Security and Investigation Agency (PSVSIA),
GVM Security and Investigations Agency, Inc. (GVM). and Abaquin Security
and Detective Agency, Inc. (ASDA). These three agencies were collectively
referred to by private respondent Union as the “PGA Security Agency,”
which is actually the first letters of the corporate names of the agencies.
On April 11, 1989, summons was issued to the management of PSVSIA,
GVM, ASDA (PGA Security Agency) at 82 E. Rodriquez Avenue, Quezon
City.
On April 11, 26, 1986, petitioners filed a single comment alleging therein
that the said three security agencies have separate and distinct corporate
personalities while PGA Security Agency is not a business or corporate
entity and does not possess any personality whatsoever; the petition was
unclear as to whether the rank-and-file employees mentioned therein refer
to those of the three security agencies collectively and if so, the labor
union cannot seek a certification election in three separate bargaining
units in one petition.
ISSUE: Whether or not petitioners can interfere with the certification
election proceeding?
HELD: No, its role in a certification election has aptly been described in
Trade Unions of the Philippines and Allied Services (TUPAS) v. Trajano, as
that of a mere by-stander. It has no legal standing in a certification election
as it cannot oppose the petition or appeal the Med-Arbiter’s orders related
thereto. An employer that involves itself in a certification election lends
suspicion to the fact that it wants to create a company union.
This Court’s disapprobation of management interference in certification
elections is even more forceful in Consolidated Farms, Inc. v. Noriel, where
we held “On a matter that should be the exclusive concern of labor, the
choice of a collective bargaining representative, the employer is definitely
an intruder. His participation, to say the least, deserves no encouragement.
This Court should be the last agency to lend support to such an attempt at
interference with a purely internal affair of labor”.
G.R. No. 96490 February 3, 1992
INDOPHIL TEXTILE MILL WORKERS UNION-PTGWO, petitioner, vs.
VOLUNTARY ARBITRATOR TEODORICO P. CALICA and INDOPHIL
TEXTILE MILLS, INC., respondents.

FACTS: Petitioner Indophil Textile Mill Workers Union-PTGWO and private

respondent Indophil Textile Mills, Inc. executed a collective bargaining
agreement. Acrylic became operational and hired workers according to its
own criteria and standards. The workers of Acrylic unionized and a duly
certified collective bargaining agreement was executed. A year after the
workers of Acrylic have been unionized and a CBA executed, the petitioner
Indophil Textile Mill Workers Union-PTGWO claimed that the plant
facilities built and set up by Acrylic should be considered as an extension or
expansion of the facilities of private respondent Indophil Textile Mills, Inc.

ISSUE: WHETHER THE RESPONDENT ARBITRATOR TEODORICO P.

CALICA ERRED IN INTERPRETING SECTION 1(c), ART I OF THE CBA
BETWEEN PETITIONER UNION AND RESPONDENT COMPANY

HELD: No. Under the doctrine of piercing the veil of corporate entity,
when valid grounds therefore exist, the legal fiction that a corporation is an
entity with a juridical personality separate and distinct from its members or
stockholders may be disregarded.

In the case at bar, petitioner seeks to pierce the veil of corporate entity of
Acrylic, alleging that the creation of the corporation is a devise to evade
the application of the CBA between petitioner Union and private
respondent Company. While we do not discount the possibility of the
similarities of the businesses of private respondent and Acrylic, neither are
we inclined to apply the doctrine invoked by petitioner in granting the
relief sought. The fact that the businesses of private respondent Indophil
Textile Mills, Inc. and Acrylic are related, that some of the employees of
the private respondent Indophil Textile Mills, Inc. are the same persons
manning and providing for auxilliary services to the units of Acrylic, and
that the physical plants, offices and facilities are situated in the same
compound, it is our considered opinion that these facts are not sufficient to
justify the piercing of the corporate veil of Acrylic.

Hence, the Acrylic not being an extension or expansion of private

respondent Indophil Textile Mills, Inc., the rank-and-file employees
working at Acrylic should not be recognized as part of, and/or within the
scope of the petitioner Indophil Textile Mill Workers Union-PTGWO, as the
bargaining representative of private respondent Indophil Textile Mills, Inc.
UMALI VS COURT OF APPEALS
189 SCRA 529 [GR NO. 89561 SEPTEMBER 13, 1990]

FACTS:  The Castillo family are the owners of parcel of land which was
given as security for a loan for their failure to pay the amortization,
foreclosure of the said property was about to be initiated. This problem
was made known to Santiago Rivera, who proposed to them the
conversion into subdivision of the four parcels of land adjacent to the
mortgaged property to raise the necessary fund. Meanwhile, for violation
of the terms and conditions of the counter-guaranty agreement, the
properties of the Castillos were foreclosed by ICP as the highest bidder
with a bid of P285,212, a certificate of sale was issued by the provincial
sheriff of Lucena City and TCT over the subject parcels of land were issued.

ISSUE: Whether or not the foreclosure is proper so as to apply the doctrine

of piercing the veil of corporate entity.

HELD: No. Under the doctrine of piercing the veil of corporate entity,

when valid grounds therefore exist, the legal fiction that a corporation is an
entity with a juridical personality separate and distinct from its members or
stockholders may be disregarded. In such cases, the corporation will be
considered as a mere association of persons. The doctrine applies when the
corporate fiction is used to defeat public convenience, justify wrong,
protect fraud, or defend crime, on when it is made as a shield to confuse
the legitimate issues or where a corporation is the mere alter ego or
business conduit of a person, or where the corporation is so organized and
controlled and its affairs are so conducted as to make it merely an
instrumentality, agency, conduit or adjunct of another corporation.

In the case at bar, petitioners seek to pierce the veil of corporate entity of
Bormaheco, ICP and PM parts, alleging that these corporations employed
fraud in causing the foreclosure and subsequent sale of the real properties
belonging to petitioners while we do not discount the possibility of
existence of fraud in the foreclosure proceeding, neither are we inclined to
apply the doctrine invoked by petitioners in granting the relief sought. It is
our considered opinion that piercing the veil of corporate entity is not the
proper remedy in order that the foreclosure proceeding may be declared a
nullity under the circumstances obtaining in the legal case at bar.

The mere fact, therefore, that the business of two or more corporations are
interrelated is not a justification for disregarding their separate
personalities, absent sufficient showing that the corporate entity was
purposely used as a shield to defraud creditors and third persons of their
rights.
G.R. No. 111262 September 19, 1996
SAN MIGUEL CORPORATION EMPLOYEES UNION-PTGWO,
represented by its President RAYMUNDO HIPOLITO, JR. vs. HON. MA.
NIEVES D. CONFESOR, Secretary of Labor, Dept. of Labor &
Employment, SAN MIGUEL CORPORATION, MAGNOLIA
CORPORATION (Formerly, Magnolia Plant) and SAN MIGUEL FOODS,
INC. (Formerly, B-Meg Plant)
FACTS: On June 28, 1990, petitioner-union San Miguel Corporation
Employees Union — PTGWO entered into a CBA with private respondent
San Miguel Corporation (SMC). Meanwhile, effective October 1, 1991,
Magnolia and Feeds and Livestock Division were spun-off and became two
separate and distinct corporations: Magnolia Corporation (Magnolia) and
San Miguel Foods, Inc. (SMFI). Notwithstanding the spin-offs, the CBA
remained in force and effect.
After June 30, 1992, the CBA was renegotiated, 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: Whether or not the duration of the renegotiated terms of the CBA
is to be effective for three years of for only two years; and
HELD:  The SC agreed with the with the Secretary of Labor.
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.
Thus, we do not find any grave abuse of discretion on the part of the
Secretary of Labor in ruling that the effectivity of the renegotiated terms
of the CBA shall be for 3 years.
G.R. No. 183810               January 21, 2010
FARLEY FULACHE, MANOLO JABONERO, DAVID CASTILLO, JEFFREY
LAGUNZAD, MAGDALENA MALIG-ON BIGNO, FRANCISCO CABAS,
JR., HARVEY PONCE and ALAN C. ALMENDRAS, Petitioners,
vs.
ABS-CBN BROADCASTING CORPORATION, Respondent.

FACTS:  The petitioners in this case are questioning the CBA executed

between ABS-CBN and the ABS-CBN Rank-and-File Employees Union
(Union) because under such agreement, they are only considered as
temporary and not regular employees.  The petitioners claimed that they
should be recognized as regular employees of ABS-CBN because they had
already rendered more than a year of service in the company and,
therefore, entitled to the benefits of a regular employee. Labor Arbiter
Rendoque rendered his decision holding that the petitioners were regular
employees of ABS-CBN.
 
ABS-CBN appealed the ruling to NLRC Fourth Division, While the appeal of
the regularization case was pending, ABS-CBN dismissed Fulache,
Jabonero, Castillo, Lagunzad and Atinen (all drivers) for their refusal to sign
up contracts of employment with service contractor Able Services.  The
four drivers and Atinen responded by filing a complaint for illegal
dismissal.

ISSUE: 
1. Whether or not the petitioners are correct that they should be
considered already as regular employees
2. Whether or not Fulache and the other petitioners were dismissed
illegally

RULING:
1. Yes, the petitioners fall within the coverage of the bargaining unit and
are therefore entitled to CBA benefits as a matter of law and contract. The
petitioners are members of the appropriate bargaining unit because they
are regular rank-and-file employees and do not belong to any of the
excluded categories. Specifically, nothing in the records shows that they
are supervisory or confidential employees; neither are they casual nor
probationary employees.

2. Yes, they were illegally dismissed, Their dismissal was not only unjust
and in bad faith.  The bad faith in ABS-CBN’s move toward its illegitimate
goal was not even hidden; it dismissed the petitioners – already recognized
as regular employees – for refusing to sign up with its service
contractor.  Thus, from every perspective, the petitioners were illegally
dismissed.
KAPISANAN NG MGA MANGGAGAWA SA MANILA RAILROAD
COMPANY VS. YARD CREW UNION, STATION EMPLOYEES UNION,
RAILROAD ENGINEERING DEPARTMENT UNION, MANILA RAILROAD
COMPANY, AND COURT OF INDUSTRIAL RELATIONS

FACTS: Kapisanan filed a petition for it to be certified as the exclusive

bargaining agent in the Manila Railroad Company. The Court found the 3
unions appropriate or purposes of CBA: Unit of locomotive drivers,
firemen, assistant firemen, and motormen-otherwise known as the engine
crew unit, Unit of conductors, assistant conductors, unit agents, assistant
route agents and train posters, or the crew unit, All of the rest of the
company except the supervisors, temporary employees. The following
units were certified to be exclusive bargaining agents: Union de
maquinista, fogoneros, ayudantes y motormen, Union de empleados de
trenes, Kapisanan.

The Yard crew union filed that it be a separate unit. Kapisanan opposed as
there have been duly certified agents, that the court has denied similar
petitions and that the unions are barred for petitioning separate units as
they are bound by the previous decision of the Court, however ordered a
plebiscite in the 3 groups, saying that the CBA did not bar the certification
election as one of the signees was a supervisor

ISSUE: Whether or not there should be a plebiscite?

HELD:

Yes. It is manifest therefore that the desires of the employees or the

“Globe Doctrine” is one of the factors in determining the appropriate
bargaining unit. The votes of workers one way or the other will not choose
the agent or unit which will represent them
Petitioner, GENERAL RUBBER AND FOOTWEAR CORP. V.
Respondents, BLR G.R. No. L-74262, October 29, 1987
FACTS: Petitioner is a corporation engaged in the business of
manufacturing rubber sandals and other rubber products. In 1985, the
Samahang Manggagawa sa General Rubber Corporation–ANGLO was
formed by the daily paid rank and file employees as their union for
collective bargaining, after the expiration on October 15, 1985 of the CBA
previously executed by petitioner with General Rubber Workers Union
(Independent) on October 15, 1982. Be it noted however that on July 17,
1985, the monthly-paid employees of the petitioner-corporation, after
forming their own collective bargaining unit–the National Association of
Trade Unions of Monthly Paid Employees-NATU, filed a petition for direct
certification with BLR (opposed by petitioner).
ISSUE: Whether or not private respondents are entitled to form union.
RULING: YES, PRIVATE RESPONDENTS ARE NOT MANAGERS,
the members of private respondent are not managerial employees as
claimed by petitioners but merely considered as rank-and-file employees
who have every right to self-organization or to be heard through a duly
certified collective bargaining union.
These members of private respondent union do not fit the definition of
managerial employees which We laid down in the case of Bulletin
Publishing Corporation v. Sanchez (144 SCRA 628). These members of
private respondent union are therefore not prohibited from forming their
own collective bargaining unit since it has not been shown by petitioner
that “the responsibilities (of these monthly-paid- employees) inherently
require the exercise of discretion and independent judgment as
supervisors” or that “they possess the power and authority to lay down or
exercise management policies.”
Similarly, We held in the same case that “Members of supervisory unions
who do not fall within the definition of managerial employees shall
become eligible to join or assist the rank-and-file labor organization, and if
none exists, to form or assist in the forming of such rank-and-file
organizations.” 
DELA SALLE UNIVERSITY vs. DELA SALLE UNIVERSITY EMPLOYEES
ASSOCIATION (DLSUEA) and BUENAVENTURA MAGSALIN
G.R. No. 109002 April 12, 2000
FACTS: On 1986, Dela Salle University (UNIVERSITY) and Dela Salle
University Employees Association — National Federation of Teachers and
Employees Union (UNION), which is composed of regular non-academic
rank and file employees, entered into a collective bargaining agreement.
During the freedom period, or 60 days before the expiration of the said
collective bargaining agreement, the Union initiated negotiations with the
University for a new collective bargaining agreement which, however,
turned out to be unsuccessful, hence, the Union filed a Notice of Strike
with the National Conciliation and Mediation Board, National Capital
Region.
ISSUE: Whether CSB employees may be included in the new CBA since
they were not previously included in the CBA between the University and
the Union
HELD: The University's arguments on the first issue fail to impress us. The
Court agrees with the Solicitor General that the express exclusion of the
computer operators and discipline officers from the bargaining unit of
rankand-file employees in the 1986 collective bargaining agreement does
not bar any re-negotiation for the future inclusion of the said employees in
the bargaining unit. During the freedom period, the parties may not only
renew the existing collective bargaining agreement but may also propose
and discuss modifications or amendments thereto. With regard to the
alleged confidential nature of the said employees' functions, after a careful
consideration of the pleadings filed before this Court, we rule that the said
computer operators and discipline officers are not confidential employees.
As carefully examined by the Solicitor General, the service record of a
computer operator reveals that his duties are basically clerical and
nonconfidential in nature. 52 As to the discipline officers, we agree with the
voluntary arbitrator that based on the nature of their duties, they are not
confidential employees and should therefore be included in the bargaining
unit of rank-and-file employees. The Court also affirms the findings of the
voluntary arbitrator that the employees of the College of St. Benilde
should be excluded from the bargaining unit of the rank-and-file
employees of Dela Salle University, because the two educational
institutions have their own separate juridical personality and no sufficient
evidence was shown to justify the piercing of the veil of corporate fiction.
G.R. NO. 162355: August 14, 2009
STA. LUCIA EAST COMMERCIAL CORPORATION, Petitioner, v. HON.
SECRETARY OF LABOR AND EMPLOYMENT and STA. LUCIA EAST
COMMERCIAL CORPORATION WORKERS ASSOCIATION (CLUP
LOCAL CHAPTER), Respondents.
FACTS: Confederated Labor Union of the Philippines (CLUP), in
behalf of its chartered local, instituted a petition for certification
election among the regular rank- and-file employees of Sta. Lucia East
Commercial Corp and its Affiliates. Med-Arbiter Bactin ordered the
dismissal of the petition due to inappropriateness of the bargaining unit.
CLUP-SLECC and its Affiliates Workers Union then reorganized itself and
re-registered as CLUP- Sta. Lucia East Commercial Corporation
Workers Association (CLUP-SLECCWA), limiting its membership to the
rank-and-file employees of Sta. Lucia East Commercial Corporation.
CLUP-SLECCWA then filed the instant petition. It alleged that SLECC
employs about 115 employees and that more than 20% of employees
belonging to the rank-and-file category are its members. CLUP-SLECCWA
claimed that no certification election has been held among them
within the last 12 months prior to the filing of the petition, and while
there is another union registered covering the same employees, namely
SMSLEC, it has not been recognized as the exclusive bargaining
agent of SLECC’s employees. Subsequently, SLECC filed a motion
to dismiss the petition. It averred that it has voluntarily recognized
MSLEC as the exclusive bargaining agent of its regular rank-and-file
employees, and that collective bargaining negotiations already
commenced between them. Then a CBA between SMSLEC and SLECC
was ratified by its rank-and-file employees and registered with DOLE.
ISSUE: Whether or not CLUP-SLECC and its affiliate’s workers union,
validly acquired juridical personality?
HELD: Yes, employees in two corporations cannot be treated as a
single bargaining unit even if the businesses of the two corporations
are related. The inclusion in the union of disqualified employees is not
among the grounds for cancellation of registration, unless such
inclusion is due to misrepresentation, false statement or fraud under the
circumstances enumerated in Sections (a) to (c) of Article 239 of the Labor
Code. 10] Thus, CLUP-SLECC and its affiliate’s workers union, having been
validly issued a certificate of registration, should be considered as
having acquired juridical personality which may not be attacked
collaterally. The proper procedure for SLECC is to file a petition
for cancellation of certificate of registration of CLUP-SLECC and its
affiliates’ workers union and not to immediately commence voluntary
recognition proceedings with SMSLEC.
SAN MIGUEL CORPORATION, petitioner, vs. NATIONAL LABOR
RELATIONS COMMISSION, SECOND DIVISION, AND SAN MIGUEL
CORPORATION EMPLOYEES UNION (SMCEU) - PTGWO, respondents.
G.R. No. 99266 March 2, 1999
Facts: In July 1990, San Miguel Corporation, alleging the need to
streamline its operations due to financial losses, shut down some of its
plants and declared 55 positions as redundant.
The respondent union filed several grievance cases for the said retrenched
employees, praying for the redeployment of the said employees to the
other divisions of the company. During the grievance proceedings,
however, most of the employees were redeployed, while others accepted
early retirement.
The union filed with the NCMB of the DOLE a notice of strike. Petitioner
moved to dismiss the notice of strike but the NCMB failed to act on the
motion.
ISSUE: Whether or not the notice of strike should have been dismissed by
the NLRC.
RULING: No. In the case under consideration, the grounds relied upon by
the private respondent union are non-strikeable. The issues which may
lend substance to the notice of strike filed by the private respondent union
are: collective bargaining deadlock and petitioner’s alleged violation of the
collective bargaining agreement. These grounds, however, appear more
illusory than real. Collective Bargaining Deadlock is defined as “the
situation between the labor and the management of the company where
there is failure in the collective bargaining negotiations resulting in a
stalemate” This situation is non-existent in the present case since there is a
Board assigned on the third level (Step 3) of the grievance machinery to
resolve the conflicting views of the parties.
Instead of asking the Conciliation Board composed of five representatives
each from the company and the union, to decide the conflict, petitioner
declared a deadlock, and thereafter, filed a notice of strike. For failing to
exhaust all the steps in the grievance machinery and arbitration
proceedings provided in the Collective Bargaining Agreement, the notice
of strike should have been dismissed by the NLRC and private respondent
union ordered to proceed with the grievance and arbitration proceedings.
Abolition of departments or positions in the company is one of the
recognized management prerogatives.