Collective Bargaining

Policies in the Constitution – Pars. 2 and 3, Sec. 3, Art. XIII, 1987 Constitution

It shall guarantee the rights of all workers to self-organization, collective bargaining and negotiations, and
peaceful concerted activities, including the right to strike in accordance with law. They shall be entitled to
security of tenure, humane conditions of work, and a living wage. They shall also participate in policy and
decision-making processes affecting their rights and benefits as may be provided by law. The State shall
promote the principle of shared responsibility between workers and employers and the preferential use of
voluntary modes in settling disputes, including conciliation, and shall enforce their mutual compliance
therewith to foster industrial peace.

Policies in Labor Legislation- Arts. 218 A & B , Book V, IRR Rule XVI, Sec. 1

Art. 218. Powers of the Commission. The Commission shall have the power and authority:
a. To promulgate rules and regulations governing the hearing and disposition of cases before it and its
regional branches, as well as those pertaining to its internal functions and such rules and regulations as
may be necessary to carry out the purposes of this Code; (As amended by Section 10, Republic Act No.
6715, March 21, 1989)
b. To administer oaths, summon the parties to a controversy, issue subpoenas requiring the attendance
and testimony of witnesses or the production of such books, papers, contracts, records, statement of
accounts, agreements, and others as may be material to a just determination of the matter under
investigation, and to testify in any investigation or hearing conducted in pursuance of this Code;

SECTION 1. Penalties. — Any person violating any of the provisions of Article 264 of the Code shall be
punished by a fine of not less than one thousand (P1,000.00) pesos nor more than ten thousand
(P10,000.00) pesos and/or imprisonment for not less than three months nor more than three years, or
both such fine and imprisonment, at the discretion of the court. Prosecution under this provision shall
preclude prosecution for the same act under the Revised Penal Code and vice versa.

CASES:

 Kiok Loy vs. NLRC, G.R. No. L-54334 (1986)

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.

From the over-all conduct of petitioner company in relation to the task of negotiation, 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.

 Rivera vs. Espiritu, G.R. No. 135547 (2000)

CBA is “a contract executed upon request of either the employer or the exclusive bargaining
representative incorporating the agreement reached after negotiations 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.
The primary purpose of CBA: stabilization of labor-management relations, to create sound & stable
industrial peace. Thus, in construing a CBA, the courts must be: practical and realistic, and give due
consideration to the context in which it is negotiated, and the purpose which it is intended to serve. Art.
253-A’s two-fold purpose: Promote industrial stability and predictability and To assign specific timetables
wherein negotiations become a matter of right and requirement. BUT nothing in Article 253-A, prohibits
the parties from waiving or suspending the mandatory timetables and agreeing on the remedies to enforce
the same. 5-year representation limit applies only when there is an existing CBA.

Duty to Bargain Collectively – Art. 263

The duty to bargain collectively – is the performance of a mutual obligation to meet and convene
promptly and expeditiously in good faith. However, There is no per se test of good faith in bargaining.

CASES:

 Tabangao Shell Refinery Employees Association vs. Pilipinas Shell Petroleum

Corporation, G.R. No. 170007 (2014)

While the purpose of collective bargaining is the reaching of an agreement between the employer and the
employee’s union resulting in a binding contract between the parties, the failure to reach an agreement
after negotiations continued for a reasonable period does not mean lack of good faith. The laws invite and
contemplate a collective bargaining contract but do not compel one. For after all, a CBA, like any contract
is a product of mutual consent and not of compulsion. The issue of whether there was already deadlock
between the union and the company is likewise a question of fact. It requires the determination of
evidence to find whether there is a “counteraction” of forces between the union and the company and
whether each of the parties exerted “reasonable effort at good faith bargaining.”

 Union of Filipro Employees vs. Nestle, G.R. Nos. 158930-31 (2008)

Good faith or bad faith is an inference to be drawn from the facts. The obligation to reach an agreement:
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. The failure to reach an agreement
after negotiations continued for a reasonable period does not establish a lack of good faith.

 Different kinds of Bargaining: Blue Sky, Individual, Surface,

Boulwarism Bargaining

Blue-Sky Bargaining is defined as "unrealistic and unreasonable demands in negotiations by either or

both labor and management, where neither concedes anything and demands the impossible." It actually is
not collective bargaining at all.

Surface bargaining is defined as "going through the motions of negotiating," without any real intent to
reach an agreement.

Boulwarism is a take-it-or-leave-it approach in negotiation constitutes bad faith. "Although the law
cannot open a man's mind, it can at least compel him to conduct himself as if he were trying to persuade
and were willing to be persuaded. To offer the union a contract saying 'Take it or leave it,' is not
bargaining collectively within the meaning of the act.”
 CASES:

 Standard Bank Chartered Employees Union vs. Confesor, supra

 The Insular Life Assurance Co. Ltd., Employees Assn. vs. Insular Life
Assurance Co., Ltd, G.R. No. L-25291 (1971)

Individual Bargaining - it is an unfair labor practice for an employer operating under a CBA to
negotiate with his employees individually. That constitutes interference because the company is still
under obligation to bargain with the union as the bargaining representative.

Individual bargaining contemplates a situation where the employer bargains with the union through the
employees instead of the employees through the union.

 Bargaining in the Absence of a CBA- Art. 262, Labor Code

Duty to bargain collectively in the absence of collective bargaining agreements - in the

absence of an agreement or other voluntary arrangement providing for a more expeditious manner of
collective bargaining, the employer and the representatives of the employees have the duty to bargain
collectively.

 Bargaining when there is an existing CBA – Art. 264, Labor Code

The duty to bargain collectively shall also mean that neither party shall terminate nor modify such
agreement during its lifetime.

General Rule: Even during the effectivity of a collective bargaining agreement executed between
employer and employees through their agent, the employees can change said agent but the contract
continues to bind them up to its expiration date. They may bargain, however, for the shortening of said
expiration date.

Exception: At least sixty (60) days prior to the expiration of the collective bargaining agreement, either
party can serve a written notice to terminate or modify the agreement. During this 60-day period, a
verified petition questioning the majority status of the incumbent bargaining agent may also be filed

It shall be the duty of both parties to keep the status quo and to continue in full force and effect the terms
and conditions of the existing agreement during the 60-day period and/or until a new agreement is
reached by the parties.

 Substitutionary Doctrine and Effect on an existing CBA- Art. 264 and 268

The substitutionary doctrine provides that the employees cannot revoke the validly executed
collective bargaining contract with their employer by the simple expedient of changing their bargaining
agent. It is in the light of this that the phrase “said new agent would have to respect said contract” must be
understood. It only means that the employees, thru their new bargaining agent, cannot renege on their
collective bargaining contract, except of course to negotiate with management for the shortening thereof.

Requirements

1. Change of bargaining agent (through affiliation, disaffiliation, or other means); and

2. Existing CBA with the previous bargaining agent.

Effects - New bargaining agent cannot revoke and must respect the existing CBA and it may negotiate
with management to shorten the existing CBA’s lifetime.
  The Procedures in Collective Bargaining when based on Private Agreement – Arts.
262, and 218-A(a)

Private Procedure - The bargaining procedure shall be governed by [the parties’] agreement or other
voluntary arrangement providing for a more expeditious manner of collective bargaining. It is the policy
of the state to promote and emphasize the primacy of free collective bargaining and negotiations.

 The Procedures in Collective Bargaining based on the Labor Code- Art. 261, Book V,
IRR Rule XII, Sec. 1 and NCMB Manual, Rule IV, Sec. 3

Labor Code Procedure – In absence of a private agreement, the collective bargaining procedure under
Art. 261 shall be followed:

1. Written notice and statement of proposals – when a party desires to negotiate an

agreement, it shall serve a written notice upon the other party with a statement of its proposals.
2. Reply – the other party shall make a reply thereto not later than ten (10) calendar days from
receipt of such notice.
3. Conference – should differences arise on the basis of such notice and reply, either party may
request for a conference which shall begin not later than ten (10) calendar days from the date of
request.
4. Board intervention and conciliation – If the dispute is not settled, the NCMB shall
intervene upon request of either or both parties or at its own initiative and immediately call the
parties to conciliation meetings. The NCMB shall have the power to issue subpoenas requiring the
attendance of the parties to such meetings. It shall be the duty of the parties to participate fully
and promptly in the conciliation meetings the Board may call.
5. Voluntary arbitration – The NCMB shall exert all efforts to settle disputes amicably and
encourage the parties to submit their case to a voluntary arbitrator.
6. Prohibition against disruptive act – During the conciliation proceedings in the Board, the
parties are prohibited from doing any act which may disrupt or impede the early settlement of the
disputes.
7. Deadlock. Any certified or duly recognized bargaining representative may file a notice or declare
a strike or request for preventive mediation in cases of bargaining deadlocks and unfair labor
practices. The employer may file a notice or declare lockout or request for preventive mediation in
the same cases. In the absence of certified or duly recognized bargaining representative, any
legitimate labor organization in the establishment may file a notice, request preventive mediation
or declare a strike but only on grounds of unfair labor practice.

CASES:

• National Union of Restaurant Workers vs. CIR, G.R. No. L-20044 (1964)
Period to Reply vis-à-vis Bad Faith – The period to reply is merely procedural, and non-compliance
cannot be automatically deemed to be an act of unfair labor practice.

• General Milling Corp. vs. CA, G.R. No. 146728, (2004)

Failure to Reply as Indica of Bad Faith – The employer’s refusal to make a counter- proposal is an
indication of its bad faith. Where the employer did not even bother to submit an answer to the bargaining
proposals of the union, there is a clear evasion of the duty to bargain collectively, making it liable for
unfair labor practice.

 What are the Mandatory issues in collective bargaining? - Art. 263, Labor Code
 How to determine mandatory bargainable issues

Mandatory Bargainable Issues

 1. Wages
2. Hours of work
3. All other terms and conditions of employment including proposals for adjusting any grievances or
questions arising under such agreement

Examples:

1. Vacations and holidays

2. Bonuses
3. Seniority, Transfer, and Layoffs
4. Employee workloads
5. Work rules and regulations
6. Union security arrangements
7. Pension and insurance benefits for active

Test for Mandatory Bargainable Issues

The nexus between the Nature of Employment and the Nature of the Demand: For “other terms and
conditions of employment” to become a mandatory bargainable issue, they must have a connection
between the proposal and the nature of the work. In order for a matter to be subject to mandatory
collective bargaining, it must materially or significantly affect the terms and conditions of employment.
Whether the agreement concerns a mandatory subject of bargaining depends not on its form, but on its
practical effect.

CASES:

• Manila Fashions vs. NLRC, G.R. No. 117878 (1996)

Permissive Issues – As in all other contracts, the parties in a CBA may establish such stipulations,
clauses, terms and conditions as they may deem convenient provided, they are not contrary to law,
morals, good customs, public order or public policy. The question as to what are mandatory and what are
merely permissive subjects of collective bargaining is of significance on the right of a party to insist on his
position to the point of stalemate. A party may refuse to enter into a collective bargaining contract unless
it includes a desired provision as to a matter which is a mandatory subject of collective bargaining.

• Samahang Manggagawa sa Top Form vs. NLRC, G.R. No. 113856 (1998)

It is no answer to the charge of refusal to bargain in good faith that the insistence on the disputed clause
was not the sole cause of the failure to agree or that agreement was not reached with respect to other
disputed clauses. Such refusal will not be deemed as an unfair labor practice. However, if a party refuses
to contract based on an issue which is not a mandatory bargainable issue, the party will be guilty of ULP.
Where a proposal raised by a contracting party does not find print in the CBA, it is not a part thereof and
the proponent has no claim whatsoever to its implementation.

Minutes of Negotation – the Minutes only reflects the proceedings and discussions undertaken in the
process of bargaining for worker benefits in the same way that the minutes of court proceedings show
what transpired therein. At the negotiations, it is but natural for both management and labor to adopt
positions or make demands and offer proposals and counter-proposals. However, nothing is considered
final until the parties have reached an agreement.

• What is a Deadlock in Bargaining?

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.
CASES:

• Divine Word Tacloban vs. Secretary of Labor, G.R. No. 91915 (1992)

Deadlock is defined as the “counteraction of things producing entire stoppage: a state of inaction or of
neutralization caused by the opposition of persons or of factions: a standstill. There is a deadlock when
there is a “complete blocking or stoppage resulting from the action of equal and opposed forces.” The
word is synonymous with the word impasse which, “presupposes reasonable effort at good faith
bargaining which, despite noble intentions, does not conclude in agreement between the parties.”

• San Miguel Corp vs. NLRC, G.R. No. 99266 (1999) (Check Collective Bargaining Deadlock)

• Pentagon Steel vs. CA, G.R. No. 174141, 2009

Privileged Communication in Conciliation Proceedings – information and statements made at

conciliation proceedings shall be treated as privileged communication and shall not be used as evidence in
the Commission. Conciliators and similar officials shall not testify in any court or body regarding any
matters taken up at conciliation proceedings conducted by them.

1. A person is entitled to ‘buy his or her peace’ without danger of being prejudiced in case his or her
efforts fail.
2. Offers for compromise are irrelevant because they are not intended as admissions by the parties
making them.
 After the bargaining, the Collective Bargaining Agreement (CBA)
 What is a CBA? – Sec. 1(K), Rule 1, Book V, IRR

Collective Bargaining Agreement or “CBA” refers to the negotiated contract between

a legitimate labor organization and the employer concerning wages, hours of work and all
other terms and conditions of employment in a bargaining unit.

CASES:

• Halaguena vs. Philippine Airlines

Nature of the CBA – Although it is a rule that a contract freely entered between the parties should be
respected, since a contract is the law between the parties, said rule is not absolute. The relations between
capital and labor are not merely contractual. They are so impressed with public interest that labor
contracts must yield to the common good.

• Zuellig Pharma vs. Alice Sibal, G.R. No. 173587, (2013)

The CBA is the law between the parties and they are obliged to comply with its provisions.

• How do you interpret a CBA? – Art. 1702, Civil Code

Art. 1702, Civil Code – In case of doubt, all labor legislation and all labor contracts shall be construed
in favor of the safety and decent living for the laborer. A CBA, as a labor contract within the contemplation
of Art. 1700 of the Civil Code of the Philippines which governs the relations between labor and capital, it is
not merely contractual in nature but impressed with public interest, thus, it must yield to the common
good. As such, it must be construed liberally rather than narrowly and technically.

CASES:
• Davao Integrated Port Stevedoring Services vs. Abarquez, G.R. No. 102132, (1993)
The courts must place a practical and realistic construction upon it, giving due consideration to the
context in which it is negotiated, and purpose which it is intended to serve.

• Who benefits from a Collective Bargaining Agreement – Art. 267, Labor Code

Beneficiaries of the CBA – The labor organization designated, or selected by the majority of the
employees in an appropriate collective bargaining unit, shall be the exclusive representative of the
employees in such unit for the purpose of collective bargaining.

CASES:
• New Pacific Timber and Supply vs. NLRC, G.R. No. 124224 (2000)

When a collective bargaining contract is entered into by the union representing the employees and the
employer, even the non- member employees are entitled to the benefits of the contract. To accord its
benefits only to members of the union without any valid reason would constitute undue discrimination
against non-members.

• Mandatory stipulations in a CBA – Art. 273, Labor Code and review bargainable issues in
our earlier discussion

Art. 273. Grievance Machinery and Voluntary Arbitration

The parties to a Collective Bargaining Agreement shall include therein provisions that will ensure the
mutual observance of its terms and conditions. They shall establish a machinery for the adjustment and
resolution of grievances arising from the interpretation or implementation of their Collective Bargaining
Agreement, and those arising from the interpretation or enforcement of company personnel policies. All
grievances submitted to the grievance machinery which are not settled within seven (7) calendar days
from the date of its submission shall automatically be referred to voluntary arbitration prescribed in the
Collective Bargaining Agreement.

For this purpose, parties to a Collective Bargaining Agreement shall agree and designate a Voluntary
Arbitrator or panel of Voluntary Arbitrators. In case the parties fail to select a Voluntary Arbitrator or
panel of Voluntary Arbitrators, the Board shall designate it.

• Ratification of the CBA – Art. 237, Book V, IRR, Rule XVII, Sec. 2 (c)

Within thirty (30) days from the execution of a collective bargaining agreement – The parties
shall submit copies of the same directly to the Bureau or the Regional Offices of the Department of Labor
and Employment for registration, accompanied with:

1. Verified proofs of its posting in two conspicuous places in the place of work, and
2. Ratification by the majority of all the workers in the bargaining unit.

CASES:
• Associated Labor Unions vs. Ferrer-Calleja, G.R. No. L-77282 (1989)

The posting of copies of the collective bargaining agreement is the responsibility of the employer. The fact
that there were "no impartial members of the unit" is immaterial. The purpose of the requirement is
precisely to inform the employees in the bargaining unit of the contents of said agreement so that they
could intelligently decide whether to accept the same or not.
Effect of Non-ratification
General Rule: The collective bargaining agreement should be ratified by the majority of all the members
of the bargaining unit. Non- compliance with this requirement renders the CBA ineffective.

• Planters Products vs. National Labor Relations Commission, G.R. No. 78524 (1989)

Exception: Even if there was no ratification, the CBA will not be invalid or void considering that the
employees have enjoyed benefits from it. The employees cannot receive benefits under provisions
favorable to them and later insist that the CBA is void simply because other provisions turn out not to the
liking of certain employees.

• Registration of the CBA and requirements – Art. 237, Sec. 2, Rule XVII, Book V, IRR

Within thirty (30) days from the execution of a Collective Bargaining Agreement – the
parties shall submit copies of the same directly to the Bureau or the Regional Offices of the Department of
Labor and Employment for registration. The application for CBA registration shall be accompanied by the
original and two (2) duplicate copies of the following documents which must be certified under oath by
the representative(s) of the employer(s) and labor union(s) concerned:

1. The collective bargaining agreement;

2. A statement that the collective bargaining agreement was posted in at least two (2) conspicuous
places in the establishment or establishments concerned for at least five (5) days before its
ratification;
3. A statement that the collective bargaining agreement was ratified by the majority of the
employees in the bargaining unit of the employer or employees concerned.

Specific information submitted in confidence shall not be disclosed, except when authorized by Secretary
of Labor, when it is at issue in any judicial litigation, or when public interest or national security requires

• Unregistered CBA and Effects – Sec. 3, Rule VIII, Book V and Art. 231, Labor Code

An unregistered CBA is binding upon the parties but cannot serve as a bar to a petition for certification
election under the contract-bar rule.

Sec. 3, Rule VIII, Book V states: A petition for certification election may be filed anytime, except when a
collective bargaining agreement between the employer and a duly recognized or certified bargaining agent
has been registered in accordance with Art. 231 [now 237] of the Labor Code.

• Effectivity of the CBA – Art. 265, Labor Code

FIRST CBA – the effectivity date is whatever date the parties agree on, HOWEVER, if it is a
RENEGOTIATED CBA, the retroactivity of the date of effectivity depends upon the duration of
conclusion, If it is concluded within 6 months from the expiry date, the new CBA will retroact to the
date following the expiry date.

Example:
Expiry date: December 13; Renegotiations concluded on November 30; Effectivity date: December 14
If it is concluded beyond 6 months from the expiry date, the matter of retroaction and effectivity is left
with the parties.

• The Hold Over Principle – Art. 264, Labor Code

It shall be the duty of both parties to keep the status quo and to continue in full force and
effect the terms and conditions of the existing agreement during the 60-day period and/or until a new
agreement is reached by the parties. Which provides for automatic renewal upon expiry, pertains only
to the economic provisions of the CBA and does not include representational aspect of the CBA. A
CBA which continues to take effect beyond its expiration date, cannot constitute a bar to a filing of
petition for certification election.

CASES:
• PICOP Resources , Inc. vs. Taneca, et al, G.R. No. 160828 (2010)

When there is a representational issue, the status quo provision insofar as the need to
await the creation of a new agreement will not apply. Otherwise, it will create an absurd situation
where the union members will be forced to maintain membership by virtue of the union security clause
existing under the CBA and, thereafter, support another union when filing a petition for certification
election. If we apply it, there will always be an issue of disloyalty whenever the employees exercise their
right to self- organization. The holding of a certification election is a statutory policy that should not be
circumvented, or compromised.

• Duration of the entire CBA – Art. 265, Labor Code

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. All other provisions of the Collective Bargaining Agreement shall be renegotiated not later than
three (3) years after its execution.

• Duration of the Freedom Period: Art. 265, Labor Code

CBA Duration: Freedom Period – No petition questioning the majority status of the incumbent
bargaining agent shall be entertained and no certification election shall be conducted by the DOLE
outside of the sixty-day period immediately before the date of the expiry of such five-year term of the
Collective Bargaining Agreement.

CASES:

 FVC Labor Union -PTGWO vs. SANAMA-FVC SIGLO, G.R. No. 176249 (2009)

CBA Duration for non-economic provisions – 5 years for representational or political issues; cannot be
renegotiated to extend beyond 5 years.

 Sundowner Development Corporation vs. Drilon, G.R. No. 82341 (1989)

CBA and 3rd Party Applicability – Labor contracts such as employment contracts and CBAs are not
enforceable against a transferee of an enterprise, labor contracts being in personam, is binding only
between the parties. General Rule: there is no law requiring a bona fide purchaser of the assets of an on-
going concern to absorb in its employ the employees of the latter. However, although the purchaser of the
assets or enterprise is not legally bound to absorb in its employ the employees of the seller of such assets
or enterprise, the parties are liable to the employees if the transaction between the parties is colored or
clothed with bad faith .

 Philippine Airlines Inc. vs. NLRC, G.R. No. 125792

Where the change of ownership is in bad faith or is used to defeat the rights of labor, the successor-
employer is deemed to have absorbed the employees and is held liable for the transgressions of his or her
predecessor.

 Manlimos vs. NLRC, G.R. No. 113337 (1995)

An innocent transferee of a business establishment has no liability to the employees of the transferor to
continue employing them. Nor is the transferee liable for the past unfair labor practices of the previous
owner. Exception: When the liability therefore is assumed by the new employer under the contract of sale,
or when liability arises because of the new owner's participation in thwarting or defeating the rights of the
employees. The most that the transferee may do, for reasons of public policy and social justice, is to give
preference to the qualified separated employees in the filling of vacancies in the facilities of the purchaser.

The general rule applies only to the sale and purchase of asset. If the method of acquisition is by way of
purchase of controlling shares, the employer remains the same and the new owners must honor the
existing contracts.

I. UNFAIR LABOR PRACTICE or ULP

A. Attributes/ Nature of ULP – Art. 258, Labor Code

Art. 258. Concept of unfair labor practice and procedure for prosecution thereof – No
criminal prosecution under this Title may be instituted without a final judgment finding that an unfair
labor practice was committed, having been first obtained in the preceding paragraph.

During the pendency of such administrative proceeding, the running of the period of prescription of the
criminal offense herein penalized shall be considered interrupted:

1. The final judgment in the administrative proceedings shall not be binding in the criminal case nor
be considered as evidence of guilt
2. But merely as proof of compliance of the requirements therein set forth.

 Purpose of the policy: Protection of right to self organization and/ or collective

bargaining

Purpose of the Policy Against ULPs

Protection of right to self-organization and/or collective bargaining:
a. The employee is not only protected from the employer but also from labor organizations.
b. The employer is also protected from ULP committed by a labor organization. The public is also
protected because it has an interest in continuing industrial peace.

 Cases:
 Philcom Employees Union vs. Phil. Global, G.R. No. 144315 (2006)

Unfair labor practice refers to acts that violate the workers’ right to organize. The prohibited acts are
related to the workers’ right to self- organization and to the observance of a CBA . Without
that element, the acts, no matter how unfair, are not unfair labor practices. The only exception is Art.
259(f) [i.e. to dismiss, discharge or otherwise prejudice or discriminate against an employee for having
given or being about to give testimony under this Code].

 Requirement of an Employer-Employee Relationship

 Case: American President Lines vs. Clave, G.R. No. L-151641 (1982)
Employer-Employee Relationship Required General Rule: An unfair labor practice may be
committed only within the context of an employer-employee relationship

 Exception to the Employer-Employee Relationship Requirement: Yellow dog contracts under Art.
259(b), Labor Code

Exception: “Yellow Dog” condition or contract: to require as a condition of employment that a

person or an employee shall not join a labor organization or shall withdraw from one to which he belongs.
[Art. 259 (b)]

B. ULP by Employers – Art. 259 (a) , Labor Code

Art. 259(a). Unfair Labor Practices of Employers. – To interfere with, restrain or coerce
employees in the exercise of their right to self-organization

 Interference/Restraint/ Coercion:
The fact that the resignations of the union members occurred during the pendency of the case before the
labor arbiter shows GMC’s desperate attempts to cast doubt on the legitimate status of the union. The ill-
timed letters of resignation from the union members indicate that GMC had interfered with the right of its
employees to self-organization.

1) Interrogation

General rule: employer may interrogate its employees regarding their union affiliation for legitimate
purposes and with the assurance that no reprisals would be taken against the unionists.

Exception: when interrogation interferes with or restrains employees' right to self- organization.
The interrogation of the ER should not be persistent and/or hostile

2) Espionage

Espionage and/or surveillance by the employer of union activities are instances of interference, restraint
or coercion of employees in connection with their right to organize, form and join unions as to constitute
unfair labor practice. [...] The information obtained by means of espionage is invaluable to the employer
and can be used in a variety of cases to break a union.

3) Concerted Action

The mass demonstration and stoppage of work of the Union is not ULP. They didn’t demonstrate against
the employer, but against the Pasig police for alleged human rights abuses. This is merely an exercise of
their freedom of expression, assembly, and right to redress of grievances enshrined in the Constitution.

4) Speech

The acts of a company which subjects a union to vilification and its participation in soliciting membership
for a competing union are also acts constituting a ULP. An employer may not send letters containing
promises or benefits, nor of threats of obtaining replacements to individual workers while the employees
are on strike due to a bargaining deadlock. This is tantamount to interference and is not protected by the
Constitution as free speech.

 Yellow Dog Contracts – Art. 259 (b), Labor Code

Art. 259(b). Unfair Labor Practices of Employers. – To require as a condition of employment that a person
or an employee shall not join a labor organization or shall withdraw from one to which he belongs.
Yellow dog contracts require, as a condition of employment, that a person or an employee shall not join a
labor organization or shall withdraw from one to which he belongs.

1) Requisites of a Yellow Dog Contract

A representation by the employee that he is not a member of a labor organization

A promise by the employee that he will not join a union
A promise by the employee that upon joining a labor organization, he will quit his employment

 Contracting Out Jobs to discourage Unionism- Art. 259 (c), Labor Code

Art. 259(c). Unfair Labor Practices of Employers. – To contract out services or functions being performed
by union members when such will interfere with, restrain or coerce employees in the exercise of their
right to self-organization;

1) General rule that contracting out is not ULP per se

General Rule: contracting out is not a ULP, but is covered by the employer’s management prerogative.
Exception [Art. 259 (c)]:
1. contracted-out services or functions are
performed by union members AND
2. contracting out will interfere with, restrain, or coerce employees in the exercise of their
right to self-organization.

 Company Unionism – Art. 259 (d), Labor Code

Art. 259(d). Unfair Labor Practices of Employers. – To initiate, dominate, assist or otherwise
interfere with the formation or administration of any labor organization, including the giving of financial
or other support to it or its organizers or supporters;

1) Definition of a company union

Company union means any labor organization whose formation, function or administration has been
assisted by any act defined as unfair labor practice by this Code. [Art. 219(i)]

2) There is ULP when the employer initiates, dominates or engages in activities that interfere with
creation of a union

The employer commits ULP if it initiates, dominates, or otherwise interferes with the formation or
administration of any labor organization.

Example: giving out financial aid to any union's supporters or organizers

 Discrimination or Discouraging Unionism: Art. 259 (e), Labor Code – To discriminate in regard
to wages, hours of work and other terms and conditions of employment in order to encourage or
discourage membership in any labor organization.
 Nothing in this Code or in any other law shall stop the parties from requiring membership in a
recognized collective bargaining agent as a condition for employment, except those employees
 who are already members of another union at the time of the signing of the collective bargaining
agreement. Employees of an appropriate bargaining unit who are not members of the recognized
collective bargaining agent may be assessed a reasonable fee equivalent to the dues and other fees
paid by members of the recognized collective bargaining agent, if such non-union members accept
the benefits under the collective bargaining agreement: Provided, that the individual
authorization required under Article 242, paragraph (o) of this Code shall not apply to the non-
members of the recognized collective bargaining agent;

1) Exception: Union Security Clauses - 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.
Indirect restriction of the right of the employee to self-organize.

2) Purpose - To safeguard and ensure the existence of the union and thus, promote unionism in
general as a state policy.
the union shop and closed shop as a means of encouraging the workers to join and support the labor
union of their own choice vis-à-vis the employer.

Coverage of Union Security Clauses - All employees in the bargaining unit

EX:
*Employees who are already members of another union at the time of the signing of the collective
bargaining agreement may not be compelled by any union security clause to join any union.
*already in service at the time the closed shop union security clause took effect. Union security
clause do not have retroactive effect.
* Any employee who, at the time the union security clause took effect, is a bona fide member of
religious organization which prohibits its members from joining labor unions on religious grounds
(INC as an example)
*Confidential employees
* Employees excluded from the union security provisions by express terms of the agreement

3) Types of Union Security Clauses:

-Closed shop - An agreement where only union members may be employed and, for the
duration of the agreement, remains a member in good standing of a union. - 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.
-Maintenance of Membership - where present and future employees are not compelled to
join the SEBA, but once so joined, they must maintain their membership as a condition for
continued employment until they are promoted or transferred out of the bargaining unit or the
agreement is terminated. - 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 [their] continued
employment
-Union Shop - when all new regular employees are required to join the union within a certain
period as a condition for their continued employment. - Non-members may be hired, but to retain
employment, they must become union members after a certain period. The requirement applies to
present and future employees.
-Modified Union Shop - Employees who are not union members at the time of signing the
contract need not join the union, but all workers hired thereafter must join
-Agency Shop - Employees belonging to an appropriate collective bargaining unit who are not
members of the recognized collective bargaining agent may be assessed a reasonable fee equivalent to
the dues and other fees paid by members of the recognized collective bargaining agent, if such non-
union members accept the benefits under the collective agreement.
4) Enforcement of Union Security Clauses –
Requisites:
* The union security clause is applicable;
* The union is requesting for the enforcement of the union security provision in the CBA;
 * There is sufficient evidence to support the union’s decision to expel the employee from the
union.
Termination of employees due to Union Security Provisions – still required of due
process (notice and hearing and opportunity to be heard.) enforcement is not characterized by
arbitrariness, and always with due process.
the employer dismissed his employees in the belief in good faith that such dismissal was required by the
[union security provision] – cannot claim back pay.

Cases:
NUHWRAIN vs. NLRC, G.R. No. 179402, (2008) - An employer is not considered guilty of unfair
labor practice if it merely complied in good faith with the request of the certified union for the dismissal of
employees expelled from the union pursuant to the union security clause in the Collective Bargaining
Agreement
Tanduay Distillery Union vs. NLRC, G.R. No. 75037, (1987) - the dismissal of an employee
pursuant to a demand of the majority union in accordance with a union security agreement following the
loss of seniority rights is valid and privileged and does not constitute an unfair labor practice.
Liberty Flour Mills Employees vs. Liberty Flour Mills, G.R. No. 58768-70 (1989) - The union
shop clause was validly enforced against them and justified the termination of their services. Hence, no
back wages will be entitled to the dismissed employees.
Guijarno vs. CIR, G.R. No. L-28791-93 (1973) – security clause does not have retroactive
application.
Reyes vs. Trajano, 209 SCRA 484 (1992) – bona fide member of religious organization. Security
clause does not apply
General Milling Corporation vs. Casio, G.R. No. 149552 (2010) – Requisites of security clause
application in dismissal of an employee.
Alabang Country Club vs. NLRC, G.R. No. 170287 (2008) – follow due process (opportunity to be
heard) is still required in dismissing employees based on the security clause.

• Discrimination for having given or about to give testimony – Art. 259 (f), Labor Code - To dismiss,
discharge or otherwise prejudice or discriminate against an employee for having given or being about to
give testimony under this Code; - this included NOT to give testimony.

• Violation of Duty to bargain collectively – Art. 259 (g)- To violate the duty to bargain collectively as
prescribed by this Code;
* Collective bargaining does not end with the execution of an agreement. Being a continuous
process, the duty to bargain necessarily imposes on the parties the obligation to live up
to the terms of such a collective bargaining agreement if entered into, it is undeniable that
non-compliance therewith constitutes an unfair labor practice.

Acts deemed as Refusal to Bargain

* Refusal to bargain when there is an unresolved petition for union cancellation - pending
cancellation proceedings against the union is not a bar to set in motion the mechanics of collective
bargaining.
* Employer’s suspension of operations in order to forestall a demand for collective bargaining –
* implied refusal - failed to make a timely reply to the proposals of the union

Not deemed as refusal to bargain

1. Adoption of an adamant bargaining position in good faith, particularly where the company is
operating at a loss.
2. Refusal to bargain over demands for commission of unfair labor practices
3. Refusal to bargain during an illegal strike
4. Not initiating the bargaining
5. Refusal to bargain where the union demands for recognition and bargaining within the year
following a certification election, and the clear choice is no union and no ad interim significant
change has taken place in the unit.
6. Refusal to bargain because of making unlawful bargaining demands.
Cases:
Shell Oil Workers Union vs. Shell Co., G.R. No. L-28607 (1971) -
St. John College Inc. vs. St John Academy Faculty and Employees Union, G.R. No. 167892
(2006) - the closure was done in bad faith for the purpose of circumventing the Union’s right to
collective bargaining and its members’ right to security of tenure.
• Violation of a Collective Bargaining Agreement – Art. 259 (i) -
Art. 274, Labor Code - Jurisdiction of Voluntary Arbitrators or panel of Voluntary
Arbitrators. The Voluntary Arbitrator or panel of Voluntary Arbitrators shall have original and exclusive
jurisdiction to hear and decide all unresolved grievances arising from the interpretation or
implementation of the Collective Bargaining Agreement and those arising from the interpretation or
enforcement of company personnel policies referred to in the immediately preceding article. Accordingly,
violations of a Collective Bargaining Agreement, except those which are gross in character, shall no longer
be treated as unfair labor practice and shall be resolved as grievances under the Collective Bargaining
Agreement. For purposes of this article, gross violations of Collective Bargaining Agreement shall mean
flagrant and/or malicious refusal to comply with the economic provisions of such agreement.

The Commission, its Regional Offices and the Regional Directors of the Department of Labor and
Employment shall not entertain disputes, grievances or matters under the exclusive and original
jurisdiction of the Voluntary Arbitrator or panel of Voluntary Arbitrators and shall immediately dispose
and refer the same to the Grievance Machinery or Voluntary Arbitration provided in the Collective
Bargaining Agreement.

Book V, Rule XXII, Sec. 5 – Grounds for strike or Lockout – A strike or lockout may be declared in
cases of bargaining deadlocks and unfair labor practice. Violations of collective bargaining agreements,
except flagrant and malicious refusal to comply with its economic provisions, shall not be considered
unfair labor practice and shall not be strikeable. No strike or lockout may be declared on grounds
involving inter-union and intra-union disputes or without first having filed a notice of strike or lockout or
without the necessary strike or lockout vote having been obtained and reported to the Board. Neither will
a strike be declared after assumption of jurisdiction by the Secretary or after cerification or submission of
the dispute to compulsory or voluntary arbitration or during the pendency of cases involving the same
ground for the strike or lockout.

*failure to comply with the CBA must be flagrant and malicious refusal to comply with its economic
provisions. If there is alleged violation even it is flagrant and malicious but not on the economic provision
– not ULP.
*Mere failure to comply does not warrant to ULP.

Cases:
BPI Employees Union-Davao vs. FUBU vs. BPI, G.R. No. 174912 (2013) - only gross violations
of the economic provisions of the CBA are treated as ULP. Otherwise, they are mere grievances.
Arellano University Employees and Workers Union vs. Court of Appeals, G.R. No. 139940
(2006) - Gross violation of the CBA, under Article 261 of the Labor Code, means flagrant and/or
malicious refusal to comply with the economic provisions thereof. Evidently, the University can not be
faulted for ULP as it in good faith merely heeded the above-said request of Union members.
Royal Undergarment Corporation of the Philippines vs. CIR, G.R. L-30940 (1990) -
employees shall have the right to self-organization and to form, join or assist labor organizations of their
own choosing for the purpose of collective bargaining through representatives of their own choosing and
to engage in concerted activities for the purpose of collective bargaining and other mutual aid or
protection. Hence, it shall be unfair labor practice for an employer to discriminate in regard to tenure of
employment or any term or condition of employment to encourage or discourage membership in any
labor organization

Totality evidence - the attendant circumstances, the history of the employer's past conduct and like
considerations, coupled with an intimate connection between the employer's action and the union
affiliations or activities of the particular employee or employees, taken as a whole, raise a suspicion as
to the motivation for the employer's action, the failure of the employer to ascribe a valid reason
therefor may justify an inference that his unexplained conduct in respect of the particular employee or
employees was inspired by the latter's union membership or activities.

Art.259 (h) - To pay negotiation or attorney’s fees to the union or its officers or agents as part of the
settlement of any issue in collective bargaining or any other dispute – sweetheart contract.

C. Unfair Labor Practice of Labor Organizations

Unfair labor practices of labor organizations. It shall be unfair labor practice for a
labor organization, its officers, agents or representatives:
 Restraint or Coercion – Art. 260a, Labor Code - To restrain or coerce employees in the
exercise of their right to self-organization. However, a labor organization shall have the right to
prescribe its own rules with respect to the acquisition or retention of membership;

 Discrimination: Encourage/ Discourage Unionism – Art. 260, Labor Code - To cause or

attempt to cause an employer to discriminate against an employee, including discrimination
against an employee with respect to whom membership in such organization has been denied or
to terminate an employee on any ground other than the usual terms and conditions under which
membership or continuation of membership is made available to other members;

 Violation of Duty, or Refuse to Bargain -Art. 260 (c), Labor Code - To violate the duty, or
refuse to bargain collectively with the employer, provided it is the representative of the
employees;

 Featherbedding or Illegal Exaction – Art. 260 (d), Labor Code - To cause or attempt to cause
an employer to pay or deliver or agree to pay or deliver any money or other things of value, in the
nature of an exaction, for services which are not performed or not to be performed, including the
demand for fee for union negotiations;

 Asking or Accepting Negotiation and other Attorney’s Fees – Art. 260 (e), Labor Code - To ask for
or accept negotiation or attorney’s fees from employers as part of the settlement of any issue in
collective bargaining or any other dispute

 Violation of a Collective Bargaining Agreement – Art. 260 (f) - To violate a collective bargaining
agreement.
 Art. 274, Labor Code - Jurisdiction of Voluntary Arbitrators or panel of Voluntary
Arbitrators. The Voluntary Arbitrator or panel of Voluntary Arbitrators shall have original and
exclusive jurisdiction to hear and decide all unresolved grievances arising from the interpretation
or implementation of the Collective Bargaining Agreement and those arising from the
interpretation or enforcement of company personnel policies referred to in the immediately
preceding article. Accordingly, violations of a Collective Bargaining Agreement, except those
which are gross in character, shall no longer be treated as unfair labor practice and shall be
resolved as grievances under the Collective Bargaining Agreement. For purposes of this article,
gross violations of Collective Bargaining Agreement shall mean flagrant and/or malicious refusal
to comply with the economic provisions of such agreement.

 The Commission, its Regional Offices and the Regional Directors of the Department of Labor and
Employment shall not entertain disputes, grievances or matters under the exclusive and original
jurisdiction of the Voluntary Arbitrator or panel of Voluntary Arbitrators and shall immediately
dispose and refer the same to the Grievance Machinery or Voluntary Arbitration provided in the
Collective Bargaining Agreement.

 Book V, Rule XXII, Sec. 5 – Grounds for strike or Lockout – A strike or lockout may be
declared in cases of bargaining deadlocks and unfair labor practice. Violations of collective
bargaining agreements, except flagrant and malicious refusal to comply with its economic
provisions, shall not be considered unfair labor practice and shall not be strikeable. No strike or
 lockout may be declared on grounds involving inter-union and intra-union disputes or without
first having filed a notice of strike or lockout or without the necessary strike or lockout vote
having been obtained and reported to the Board. Neither will a strike be declared after
assumption of jurisdiction by the Secretary or after cerification or submission of the dispute to
compulsory or voluntary arbitration or during the pendency of cases involving the same ground
for the strike or lockout.

II. PEACEFUL CONCERTED ACTIVITIES - one undertaken by two or more employees to

improve their terms and conditions of work.
A. Constitutional and Statutory Basis
 Sec. 3, Art. XIII, 1987 Constitution - It shall guarantee the rights of all workers to self-
organization, collective bargaining and negotiations, and peaceful concerted activities, including
the right to strike in accordance with law. They shall be entitled to security of tenure, humane
conditions of work, and a living wage. They shall also participate in policy and decision-making
processes affecting their rights and benefits as may be provided by law.
 Art. 278 (b)- Strikes, Picketing and Lockouts - Workers shall have the right to engage in
concerted activities for purposes of collective bargaining or for their mutual benefit and
protection. The right of legitimate labor organizations to strike and picket and of employers to
lockout, consistent with the national interest, shall continue to be recognized and respected.
However, no labor union may strike and no employer may declare a lockout on grounds involving
inter-union and intra-union disputes.
 Art. 257- Non-abridgment of right to self-organization - It shall be unlawful for any
person to restrain, coerce, discriminate against or unduly interfere with employees and workers in
their exercise of the right to self-organization. Such right shall include the right to form, join, or
assist labor organizations for the purpose of collective bargaining through representatives of their
own choosing and to engage in lawful concerted activities for the same purpose for their mutual
aid and protection, subject to the provisions of Article 264 of this Code.

B. Nature of the Right to Strike and Lock out

 The right to strike is a constitutional and legal right of the workers
 the employers have the inherent and statutory right to lockout within the context
of labor relations and collective bargaining.
 It is a means of last resort and presupposes that the duty to bargain in good
faith has been fulfilled and other voluntary modes of dispute settlement have
been tried and exhausted.

C. Limitations to Right to Engage in concerted activities

 it must be declared only after the most thoughtful consultation among them,
conducted in the only way allowed; that is, peacefully, and in every case
conformably to reasonable regulation.
 Any violation of the legal requirements and strictures will render the strike
illegal

 Batangas Laguna Tayabas Bus Co. vs. NLRC, G.R. No. 101858 (1992) - The right to
strike is one of the rights recognized and guaranteed by the Constitution as an instrument of labor
for its protection against exploitation by management. the workers are able to press their
demands for better terms of employment with more energy and persuasiveness, poising the threat
to strike as their reaction to the employer's intransigence.

D. Forms of Concerted Activities:

 Concerted Activities by Employees
o Strike
 o Picketing
o boycott
 Response by Employers/ Management
o Lockout

E. The Strike - "Strike" means any temporary stoppage of work by the concerted action of
employees as a result of an industrial or labor dispute.
"Labor dispute" includes any controversy or matter concerning terms and conditions of
employment or the association or representation of persons in negotiating, fixing,
maintaining, changing or arranging the terms and conditions of employment, regardless
of whether the disputants stand in the proximate relation of employer and employee.
 What is a strike and who may declare a strike? – Sec. 6, Rule XXII, Book V, IRR – Who may
declare a strike or lockout – any certified or duty recognized bargaining representative may
declare a strike in cases of bargaining deadlock and unfair labor practices.
o The employer may declare a lockout in the same cases.
o In the absence of a certified or duly recognized bargaining representative, any legitimate
labor organization in the establishment may declare a strike but only a grounds of unfair
labor practices.
Art. 219 (o)

Cases:
Solidbank Corp vs. EU Gamier, G.R. No. 159460 and G.R. No. 159461 (2010) - A strike is a
powerful weapon of the working class. the right to strike has to be pursued within the bounds of law.

Samahang Manggagawa vs. Sulpicio Lines, G.R. No. 140992, (2004) - The term “strike” shall
comprise not only concerted work stoppages, but also slowdowns, mass leaves, sit-downs, attempts to
damage, destroy or sabotage plant equipment and facilities, and similar activities.

Elizalde Rope Factory Inc. vs. SSS, G.R. No. L-15163, (1962) – the ER-EE relationship is not
severed or dissolved if the employee participate in a legal strike.’

Visayas Community Medical Center vs. Yballe, G.R. No. 196156, (2014) – GR: Striking
employees are not entitled to the payment of wages for un-worked days during the period of the strike
pursuant to the “no work-no pay” principle.
EX: the laborer was able, willing and ready to work but was illegally locked out, suspended or
dismissed or otherwise illegally prevented from working. For this exception to apply, it is required
that the strike be legal. – if there is a illegal lockout.

Malayang Samahan ng mga Manggagawa sa Greenfield vs. Ramos, G.R. No. 113907 (2007)
– no strike no lockout clause is a valid provision under the CBA. However, it cannot be invoke if the
ground for strike is based on ULP.

Reinstatement: if the employee abandon the strike and apply for reinstatement, the employer refuses to
reinstate or impose upon their reinstatement new condition – guilty of ULP.

 Other Forms of Strike:

1) Economic Strike – the strike must be based on the economic provisions (mandatory topic in
a CBA)
2) ULP Strike – based on the ground of ULP
3) Slowdown Strike - one by which workers, without a complete stoppage of work, retard
production or their performance of duties and functions to compel management to grant their
demands.
4) Wildcat Strike
5) Sit down Strike
6) Sympathetic Strike
7) Mass Leave
Cases:
Consolidated Labor Association of the Phil. Vs. Marsman and Company, G.R. No. L-17038, (1964)

Ilaw at Buklod ng Manggagawa vs.A NLRC, G.R. No. 91980, (1991) – slowdown strike - an
inherently illegal activity essentially illegal even in the absence of a no-strike clause in a collective
bargaining contract, or statute or rule. "strike on the installment plan;" as a wilfull reduction in the rate of
work by concerted action of workers for the purpose of restricting the output of the employer, in relation
to a labor dispute; as an activity by which workers, without a complete stoppage of work, retard
production or their performance of duties and functions to compel management to grant their demands.

NUWHRAIN - The Peninsula Chapter vs. NLRC, G.R. No. 125561 (1998) – wildcat strike is
illegal because it is stage without a notice of strike and without majority approval.

Sukhothai Cuisine & Restaurant vs. CA, G.R. No. 150437 (2006) sit-down strike - one
wherein worker take over possession of the property of such business to cease production and to
refuse access to owners

Biflex Phils. Inc. Labor Union vs. Filflex Industrial and Manufacturing Corp. , G.R. No.
155679, 2006 -Stoppage of work due to welga ng bayan is in the nature of a general strike, an extended
sympathy strike. It affects numerous employers including those who do not have a dispute with their
employees regarding their terms and conditions of employment.
It is illegal because Employees who have no labor dispute with their employer but who, on a day they are
scheduled to work, refuse to work and instead join a welga ng bayan commit an illegal work stoppage.

Solidbank Corp. vs. E.U. Gamier, G.R. No. 159460-61 (2010) – mass leave - one in which
workers collectively abandon or boycott regular work causing temporary stoppage of work

 Requisites for a valid strike –

Art. 278 - It is the policy of the State to encourage free trade unionism and free collective
bargaining.

Workers shall have the right to engage in concerted activities for purposes of collective bargaining
or for their mutual benefit and protection. The right of legitimate labor organizations to strike and
picket and of employers to lockout, consistent with the national interest, shall continue to be
recognized and respected. However, no labor union may strike and no employer may declare a
lockout on grounds involving inter-union and intra-union disputes.

In case of bargaining deadlocks, the duly certified or recognized bargaining agent may file a notice
of strike or the employer may file a notice of lockout with the Ministry at least 30 day before the
intended date thereof. In cases of unfair labor practice, the period of notice shall be 15 days and in
the absence of a duly certified or recognized bargaining agent, the notice of strike may be filed by
any legitimate labor organization in behalf of its members. However, in case of dismissal from
employment of union officers duly elected in accordance with the union constitution and by-laws,
which may constitute union busting, where the existence of the union is threatened, the 15-day
cooling-off period shall not apply and the union may take action immediately. (As amended by
Executive Order No. 111, December 24, 1986)

The notice must be in accordance with such implementing rules and regulations as the Minister of
Labor and Employment may promulgate.

During the cooling-off period, it shall be the duty of the Ministry to exert all efforts at mediation
and conciliation to effect a voluntary settlement. Should the dispute remain unsettled until the
lapse of the requisite number of days from the mandatory filing of the notice, the labor union may
strike or the employer may declare a lockout.
A decision to declare a strike must be approved by a majority of the total union membership in
the bargaining unit concerned, obtained by secret ballot in meetings or referenda called for that
purpose. A decision to declare a lockout must be approved by a majority of the board of directors
of the corporation or association or of the partners in a partnership, obtained by secret ballot in a
meeting called for that purpose. The decision shall be valid for the duration of the dispute based
on substantially the same grounds considered when the strike or lockout vote was taken. The
Ministry may, at its own initiative or upon the request of any affected party, supervise the conduct
of the secret balloting. In every case, the union or the employer shall furnish the Ministry the
results of the voting at least seven days before the intended strike or lockout, subject to the
cooling-off period herein provided. (As amended by Batas Pambansa Bilang 130, August 21, 1981
and further amended by Executive Order No. 111, December 24, 1986)

When, in his opinion, there exists a labor dispute causing or likely to cause a strike or lockout in
an industry indispensable to the national interest, the Secretary of Labor and Employment may
assume jurisdiction over the dispute and decide it or certify the same to the Commission for
compulsory arbitration. Such assumption or certification shall have the effect of automatically
enjoining the intended or impending strike or lockout as specified in the assumption or
certification order. If one has already taken place at the time of assumption or certification, all
striking or locked out employees shall immediately return-to-work and the employer shall
immediately resume operations and readmit all workers under the same terms and conditions
prevailing before the strike or lockout. The Secretary of Labor and Employment or the
Commission may seek the assistance of law enforcement agencies to ensure compliance with this
provision as well as with such orders as he may issue to enforce the same.

In line with the national concern for and the highest respect accorded to the right of patients to
life and health, strikes and lockouts in hospitals, clinics and similar medical institutions shall, to
every extent possible, be avoided, and all serious efforts, not only by labor and management but
government as well, be exhausted to substantially minimize, if not prevent, their adverse effects
on such life and health, through the exercise, however legitimate, by labor of its right to strike and
by management to lockout. In labor disputes adversely affecting the continued operation of such
hospitals, clinics or medical institutions, it shall be the duty of the striking union or locking-out
employer to provide and maintain an effective skeletal workforce of medical and other health
personnel, whose movement and services shall be unhampered and unrestricted, as are necessary
to insure the proper and adequate protection of the life and health of its patients, most especially
emergency cases, for the duration of the strike or lockout. In such cases, therefore, the Secretary
of Labor and Employment may immediately assume, within twenty four (24) hours from
knowledge of the occurrence of such a strike or lockout, jurisdiction over the same or certify it to
the Commission for compulsory arbitration. For this purpose, the contending parties are strictly
enjoined to comply with such orders, prohibitions and/or injunctions as are issued by the
Secretary of Labor and Employment or the Commission, under pain of immediate disciplinary
action, including dismissal or loss of employment status or payment by the locking-out employer
of backwages, damages and other affirmative relief, even criminal prosecution against either or
both of them.

The foregoing notwithstanding, the President of the Philippines shall not be precluded from
determining the industries that, in his opinion, are indispensable to the national interest, and
from intervening at any time and assuming jurisdiction over any such labor dispute in order to
settle or terminate the same.

Before or at any stage of the compulsory arbitration process, the parties may opt to submit their
dispute to voluntary arbitration.

The Secretary of Labor and Employment, the Commission or the voluntary arbitrator shall decide
or resolve the dispute, as the case may be. The decision of the President, the Secretary of Labor
and Employment, the Commission or the voluntary arbitrator shall be final and executory ten (10)
calendar days after receipt thereof by the parties.
 Art. 274 - Jurisdiction of Voluntary Arbitrators or panel of Voluntary Arbitrators. The Voluntary
Arbitrator or panel of Voluntary Arbitrators shall have original and exclusive jurisdiction to hear
and decide all unresolved grievances arising from the interpretation or implementation of the
Collective Bargaining Agreement and those arising from the interpretation or enforcement of
company personnel policies referred to in the immediately preceding article. Accordingly,
violations of a Collective Bargaining Agreement, except those which are gross in character, shall
no longer be treated as unfair labor practice and shall be resolved as grievances under the
Collective Bargaining Agreement. For purposes of this article, gross violations of Collective
Bargaining Agreement shall mean flagrant and/or malicious refusal to comply with the economic
provisions of such agreement.

The Commission, its Regional Offices and the Regional Directors of the Department of Labor and
Employment shall not entertain disputes, grievances or matters under the exclusive and original
jurisdiction of the Voluntary Arbitrator or panel of Voluntary Arbitrators and shall immediately
dispose and refer the same to the Grievance Machinery or Voluntary Arbitration provided in the
Collective Bargaining Agreement.
 Substantial Requirements / Grounds – Art. 278 – bargaining deadlock and ULP

Cases:
Master Iron Labor vs. NLRC, 219 SCRA 47 (1993)
BPI Employees Union-Davao FUBU vs. BPI, G.R. No. 174912 (2013)

 Prohibited Activities in a Strike- Art. 279 (b) - No person shall obstruct, impede, or interfere with,
by force, violence, coercion, threats or intimidation, any peaceful picketing by employees during
any labor controversy or in the exercise of the right to self-organization or collective bargaining,
or shall aid or abet such obstruction or interference.
(c) - No employer shall use or employ any strike-breaker, nor shall any person be employed as a
strike-breaker.
(d) - No public official or employee, including officers and personnel of the New Armed Forces of
the Philippines or the Integrated National Police, or armed person, shall bring in, introduce or
escort in any manner, any individual who seeks to replace strikers in entering or leaving the
premises of a strike area, or work in place of the strikers. The police force shall keep out of the
picket lines unless actual violence or other criminal acts occur therein: Provided, That nothing
herein shall be interpreted to prevent any public officer from taking any measure necessary to
maintain peace and order, protect life and property, and/or enforce the law and legal order.

Cases:
Association of Independent Unions in the Philippines (AIUP) vs. NLRC, G.R. No. 120505 (1999)
Malayang Samahan ng Manggagawa sa M. Greenfield vs. Ramos, 357 SCRA 77 (2000)

 Categories of Illegal Strike

1) Those prohibited by law – strikes by government employees
2) Those based on improper grounds (e.g. Intra or Inter Union Dispute wage distortion)
3) Non-compliance with procedural requirements
4) Unlawful methods and means
5) Violation of a lawful order (injunctions)
6) Those contrary to an existing agreement
7) Those where strikers do not belong to any labor organization
*no strike, no lockout – valid provisions but it is only applicable to economic provisions.
Cases:
Grand Boulevard Hotel vs. GLOWHRAIN, G.R. No. 153664, (2003)
Sta. Rosa Coca Cola Plant Employees Union vs. Coca Cola Bottlers Philippines Inc., G.R. No. 164302-03,
(2007)
Philippine Diamond Hotel and Resort Inc. vs. Manila Diamond Hotel Employees Union,
G.R. No. 158075 (2006) – a legal strike can be held illegal if the means and methods is illegal
Shell Oil Workers Union vs. Shell Co. of the Philippines, G.R. No. L-28607, (1971)
Magdala Multipurpose and Livelihood Coop vs. Kilusang Manggagawa, G.R. No. 191138-39 (2011)
Toyota Motors Philippines Workers Association vs. NLRC, 537 SCRA 171 (2007)
Philippine Inter-Fashion Inc. vs. NLRC, G.R. No. L-59847 (1982)

 Effort to Bargain – Art. 279 (a) - No labor organization or employer shall declare a strike or
lockout without first having bargained collectively in accordance with Title VII of this Book or
without first having filed the notice required in the preceding Article or without the necessary
strike or lockout vote first having been obtained and reported to the Ministry.

 No strike or lockout shall be declared after assumption of jurisdiction by the President or the
Minister or after certification or submission of the dispute to compulsory or voluntary arbitration
or during the pendency of cases involving the same grounds for the strike or lockout.

 Any worker whose employment has been terminated as a consequence of any unlawful lockout
shall be entitled to reinstatement with full backwages. 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 a strike may be declared to have lost his employment status:
Provided, That mere participation of a worker in a lawful strike shall not constitute sufficient
ground for termination of his employment, even if a replacement had been hired by the employer
during such lawful strike.

Sec. 4, Rule XXII, Book V, IRR – Compromise agreements – any compromise

settlement, including those involving labor standards laws, voluntarily agreed upon by the parties
with the assistance of the Board and its regional branches shall be final and binding upon the
parties. The NLRC or any court shall not assume jurisdiction over issues involved therein except
in case of non-compliance thereof or if there is a prima facie evidence that the settlement was
obtained through fraud, misrepresentation, or coercion. Upon motion of any interested party, the
LA in the region where the agreement was reached may issue a writ of execution requiring a
sheriff of the commission or the court to enforce the terms of the agreement.

 Filing and Service of Notice of Strike – Art. 278 (c), Labor Code,
Contents of Notice of Strike

In cases of bargaining deadlocks, the duly certified or recognized bargaining agent may file a notice to
strike or the employer may file a notice of lockout with the Ministry at least 30 days before the intended
date thereof. In cases of unfair labor practice, the period of notice shall be 15 days and in the absence of a
duly certified or recognized bargaining agent, the notice of strike may be filed by any legitimate labor
organization in behalf of its members. However, in case of dismissal from employment of union officers
duly elected in accordance with the union constitution and by-laws, which may constitute union busting
where the existence of the union may take action immediately.

2) Additional Requirements – for bargaining deadlocks, ULP, and action on notice, Sec.4, Rule
XXII, Book V, IRR
 Cooling Off Periods – Art 278 (e), Labor Code

During the cool-off period, it shall be the duty of the Ministry to exert all efforts at mediation and
conciliation to effect a voluntary settlement. Should the dispute remain unsettled until the lapse of the
requisite number of days from mandatory filing of notice, the labor union may strike or the employer may
declare a lockout.

 Notice of Strike Vote Meeting – Art. 278 (f), Labor Code , Sec. 10, Rule XXII, Book V
 Strike Vote- Art. 278 (f), Strikes, Picketing and Lockouts
 Strike Vote Report – Art. 278 (f)
A decision to declare a strike must be approved by a majority of the total union membership in the
bargaining unit concerned, obtained by secret ballot in meetings or referenda called for that purpose. A
decision to declare a lockout must be approved by a majority of the board of directors of the corporation
or association or of the partners in a partnership, obtained by secret ballot in a meeting called for that
purpose. The decision shall be valid for the duration of the dispute based on substantially the same
grounds considered when the strike or lockout vote was taken. The Ministry may, at its own initiative or
upon the request of any affected party, supervise the conduct of the secret balloting. In every case, the
union or the employer shall furnish the Ministry the results of the voting at least seven days before the
intended strike or lockout, subject to the cooling-off period herein provided

 7-day Waiting Period

 Improved Offer Balloting

F. Picketing
 Basis: Art. 278(b) –

Workers shall have the right to engage in concerted activities for purposes of collective bargaining or for
their mutual benefit and protection. The right of legitimate labor organizations to strike and picket and of
employers to lockout, consistent with the national interest, shall continue to be recognized and respected.
However, no labor union may strike and no employer may declare a lockout on grounds involving inter-
union and intra-union disputes.

Cases:
Sta. Rosa Coca Cola Plant Employees Union vs. Coca Cola Bottlers Philippines, Inc., G.R. Nos. 164302-03
(2007)
Phimco Industries Inc. vs. Phimco Industries Labor Association, 628 SCRA 119 (2010)

 Prohibited Activities in Picketing – Art. 279 (b), (d) and (e)

 Constitutional protection of Picketing subject to exceptions

No person shall obstruct, impede, or interfere with, by force, violence, coercion, threats or intimidation,
any peaceful picketing by employees during any labor controversy or in the exercise of the right to self-
organization or collective bargaining, or shall aid or abet such obstruction or interference.

No public official or employee, including officers and personnel of the New Armed Forces of the
Philippines or the Integrated National Police, or armed person, shall bring in, introduce or escort in any
manner, any individual who seeks to replace strikers in entering or leaving the premises of a strike area,
or work in place of the strikers. The police force shall keep out of the picket lines unless actual violence or
other criminal acts occur therein: Provided, That nothing herein shall be interpreted to prevent any public
officer from taking any measure necessary to maintain peace and order, protect life and property, and/or
enforce the law and legal order. (As amended by Executive Order No. 111, December 24, 1986)

No person engaged in picketing shall commit any act of violence, coercion or intimidation or obstruct the
free ingress to or egress from the employer’s premises for lawful purposes, or obstruct public
thoroughfares. (As amended by Batas Pambansa Bilang 227, June 1, 1982)

Cases:
Security Bank Employees Union vs. Security Bank, G.R. No. L-28536, (1968)
Mortera vs. CIR, G.R. No. L-1340, (1947)

 What is the innocent bystander rule – courts can insulate establishment or persons with no
industrial connection or having interest totally foreign to the context of the dispute.
Case:
PCIB vs. Phinabank Employees Association , G.R. No. L-29630 (1981) - Libel laws are not
applied strictly considering that there is emotional tension in the picket lines and expected
discourteous and impolite exchanges between the employees and the employer.

G. Lockouts
 Definition- Art. 219 (P), Labor Code - "Lockout" means any temporary refusal of an employer to
furnish work as a result of an industrial or labor dispute.
 Procedural Requirements :
1. Effort to bargain – Art. 279 (a)
No labor organization or employer shall declare a strike or lockout without first having bargained
collectively in accordance with Title VII of this Book or without first having filed the notice required in the
preceding Article or without the necessary strike or lockout vote first having been obtained and reported
to the Ministry.

2. Filing and Serving of Notice – Art. 278 (c), Sec. 8, Rule XXII, Book V, IRR -
3) Observance of Cooling Off period
4) Notice of Lock out vote meeting – Sec. 10, Rule XXII, Book V -
5) Lockout vote – Art. 278 (f), Labor Code
6) Report of lockout vote- Art. 278 (f)
7) Observance of the Waiting Period (7 day strike ban) and effect of Illegal Lockout- Par. 3, Art.
279 (a)

Any worker whose employment has been terminated as a consequence of any unlawful lockout shall be
entitled to reinstatement with full backwages. 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
a strike may be declared to have lost his employment status: Provided, That mere participation of a
worker in a lawful strike shall not constitute sufficient ground for termination of his employment, even if
a replacement had been hired by the employer during such lawful strike.