Collective Bargaining and

Collective Bargaining Agreements

Atty. Dominic Victor C. De Alban
 Collective Bargaining
• It is the process of negotiation between an
employer or employers and employees
organization or union to reach an agreement
on the terms and conditions of employment
for a specified period.
• It includes:
– Demand – negotiation – agreement –
implementation – grievance/interpretation
 How should a collective bargaining
agreement be construed?
• It must be construed liberally rather than narrowly
and technically giving due consideration to the
context in which it is negotiated (ex. What “child”
refers to)
• Relations between labor and capital are so impressed
with merit and as such it must yield to common
good.
• If the terms of CBA are clear and have no doubt upon
the intention of the contracting parties, the literal
meaning of its stipulation shall prevail.
What are the most important aims or aspects
of collective bargaining?
• Establish industrial peace
• Give benefits for labor higher than those fixed
by law
• Enhance industrial efficiency
 Meaning of duty to bargain collectively (Art.
252)
• The duty to bargain collectively means the performance of
a:
– mutual obligation TO MEET AND CONVENE promptly and
expeditiously in GOOD FAITH for the
– PURPOSE OF NEGOTIATING an agreement with respect to wages,
hours of work and all other terms and conditions of employment
– including proposals for adjusting any GRIEVANCES OR
QUESTIONS ARISING UNDER SUCH AGREEMENT and executing a
contract incorporating such agreements if requested by either
party
• However, such duty does not compel any party to agree to a
proposal or to make any concession.
 Duty to bargain collectively when there
exists a collective bargaining agreement
(Art. 253)
• When there is a collective bargaining agreement, the duty to
bargain collectively shall also mean that neither party shall
terminate nor modify such agreement during its lifetime.
• However, either party can serve a written notice to
terminate or modify the agreement at least sixty (60) days
prior to its expiration date.
• It shall be the duty of both parties to keep the status quo
and to continue in full force and effect the terms and
conditions of the existing agreement during the 60-day
period and/or until a new agreement is reached by the
parties.
 “It shall be the duty of both parties to keep
the status quo and to continue in full force
and effect…”
• The automatic renewal pertains only to the
economic provisions of the CBA and does not
include the representational aspect of the CBA
• As such it cannot bar the filing of certification
election during the freedom period otherwise
it will defeat the worker’s right to self-
organization
Procedure in Collective Bargaining (Art. 250)

• When a party desires to negotiate an agreement, it

shall serve a written notice upon the other party
with a statement of its proposals. The other party
shall make a reply thereto not later than ten (10)
calendar days from receipt of such notice;
• 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.
• If the dispute is not settled, the Board shall intervene upon
request of either or both parties or at its own initiative
and immediately call the parties to conciliation meetings.
• 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
(e.g. strike)
• The Board shall exert all efforts to settle disputes amicably
and encourage the parties to submit their case to a
voluntary arbitrator.
 When can the employees demand the
commencement of negotiations?
If the following preconditions are present:
• Possession of majority status in accordance
with any of the means of selection provided
by law
• Proof of majority representation
• Demand to bargain
 Effect of violation of the duty to bargain
collectively
• Constitutes unfair labor practice
Art. 248. Unfair labor practices of employers. It
shall be unlawful for an employer to commit any
of the following unfair labor practice:
xxx
7. To violate the duty to bargain collectively as
prescribed by this Code
 Kiok Loy ruling
• If the employer violated its duty to bargain
collectively, as it did not even bother to submit
an answer or reply to the union’s proposal, the
draft CBA submitted by the union may be
approved and adopted as the parties’ CBA
• But note that either the employer or employee
cannot be compelled to concede to the other
party’s demand
 “Collective bargaining is a continuous
process”
• Parties to the agreement are obliged to meet
and confer promptly, expeditiously and in
good faith to thresh out any grievances in
accordance with the grievance procedure
therein provided
 Issues negotiated in the CBA
• NON-ECONOMIC PROVISIONS (Political provisions) –
are those whose monetary cost can not be directly
computed such as no-strike-no-lockout, union
security, management security, check-off clauses,
grievance procedures, etc.
• ECONOMIC PROVISIONS – are those which have
direct and measurable monetary cost consequences
such as wage rates, paid vacations, pensions, health
and welfare plans, penalty premiums and other
fringe benefits
 Usual provisions in a CBA
• Definition of bargaining unit – scope of the
appropriate bargaining unit covered by the
agreement
• Union security clauses – this is intended to maintain
the strength of the union during the life of the
agreement and safeguard it against the perfidy and
fickleness of its own members
• Check-off provision – employer to deduct from the
wages of union members union dues and other
assessments and remit the same to the treasurer
• Management Prerogatives clause – rights and
prerogatives of the company are enumerated
• Economic benefits – provisions granting economic
benefits to employees such as increases, vacation and
sick leaves, hospitalization and retirement
• Grievance machinery – to ensure mutual compliance
to establish a machinery for the adjustment or
grievances arising from the interpretation or
implementation of the CBA
• Voluntary Arbitration clause – submission to
voluntary arbitration of grievances not settled
through the grievance machinery and procedure
• Creation of labor-management council
 Labor-management Council
• To enable the workers:
– to participate in policy and decision-making
processes in the establishment insofar as said
processes will directly affect their rights, benefits
and welfare
• As opposed to a grievance machinery which is a
voluntary mode of settling disputes regarding:
– interpretation or implementation of the CBA
– interpretation or implementation of the company
personnel policies
• No Strike – No Lockout Clause – parties may stipulate that
during the life of the agreement the union shall not go on
strike and the employer shall not declare a lockout
• Provisions on family planning, participation in sports, etc.
– to promote knowledge and recreational activities to
reduce work monotony and promote discussion among
workers on how to increase productivity
• Provision against use of drugs in workplace
• Creditability Clause – parties agree that the benefits under
the CBA are deemed compliance by the employer of the
benefits required by laws enacted after the execution of
the CBA
• Duration of the agreement
– Representation aspect – 5 years, unless otherwise stipulated
– CBA – not later than three years
 Union Security Clause
• It is intended to strengthen the contracting
union and to protect it from the fickleness or
perfidy of its own members
• Without such safeguard, group solidarity
becomes uncertain; the union becomes
gradually weakened and increasingly
vulnerable to company machinations
 Union Security Clauses:
• Closed Shop Agreement – an agreement whereby an
employer binds himself to hire only members of the
contracting union who must continue to remain
members of the union is good standing for the duration
of the agreement as a condition for continued
employment
• Union Shop Agreement – the employer is permitted to
employ a non-union worker but to retain employment
such worker must become a union member after some
period and maintain his membership therein in good
standing for the duration of the agreement
 Closed shop (CS) vs. Union shop (US)
• Under CS, the employer cannot hire any worker who
is not a member of the contracting union; under US,
the employer may do so but the workers must
within a specified period after his employment
become a member of the contracting union
• Under CS, membership in the contracting union is a
CONDITION FOR EMPLOYMENT; under US
membership in the contracting union is a
CONDITION FOR CONTINUED EMPLOYMENT
• Maintenance of Membership Clause – does not
require non-members to join a union but
provides that those who do join must maintain
their membership for the duration of the
contract
• Preferential Shop Agreement – recognizes the
right of the employer to select his employees
but requires him to give preference to members
of the contracting union who are qualified.
 Exceptions to closed-shop agreement:

• Those who are members of another union at

the time of the signing of the CBA
– To compel the members of the minority to
disaffiliate from their union and join the majority
would render nugatory the right of the employees
to self-organization
– Members of religious sects that prohibits
membership in a union
– Those expressly excluded by the CBA
 Enforcement of the union security clause

• Acts of disloyalty, non-compliance with the

union security clause can be a cause for
dismissal upon giving the worker an
opportunity to be heard
• However, the requirement for the union
members to maintain their membership in
good standing ceases to be binding during the
60-day freedom period immediately preceding
the expiration of the CBA
 Procedure for terminating employment for
non-compliance of the union security clause:

• Prove that the union security clause is

applicable
• Union is requesting for the enforcement of the
union security provision of the CBA
• Sufficient evidence to support the decision of
the union to expel employee
 Union schism/shift in the employee’s union
allegiance
• The collective bargaining agreement is still
binding
• Although most of the members of the sole
and exclusive bargaining agent resigned
therefrom or shifted alliance with another
union, the employees remain a party to the
contract and as such it must still be
implemented
 Registration of the Collective Bargaining
Agreement
• The contract will bar a certification election except within
the last sixty days before the expiration of the
representation period of five years
• 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 verified proofs of its posting in two
conspicuous places in the place of work and ratification by
the majority of all the workers in the bargaining unit.
– However if the employees already enjoyed benefits from the CBA
it is iniquitous for them to later assail its validity because it was
not ratified
 Renegotiation of the CBA
• Any CBA, as far as representation aspect is
concerned, shall be for a term of five years
• ALL OTHER PROVISIONS (economic provisions)
shall be re-negotiated not later than three
years after its execution
 Period of retroactivity
• Any agreement on such other provisions
entered into within six months from the date
of expiry of the term shall retroact to the day
immediately following such date
– If beyond six months, parties agree as to the
duration
• “agreement” does not mean signed
agreement but upon the meeting of the minds
of the parties
 Unjustified refusal to renegotiate CBA

• If the employer commits unfair labor practice

consisting of violation to of the duty to bargain
collectively, the draft CBA propose by the
union may be imposed
• Employer, having violated its duty to bargain
collectively, lost its statutory right to negotiate
the terms and conditions of the draft CBA
proposed
 Suspension of CBA
• An agreement made by parties of equal
bargaining power is binding upon them
• The SEBA and employer may suspend the
enforcement of the CBA if they deem it proper
– Example financial distress
• Right to collective bargaining agreement
includes the right to suspend the same
Wage order vs. CBA wage increase
• In the absence of a provision of law or of the
CBA to the effect that the benefits provided by
the CBA would encompass those provided by
law, benefits derived from either the law or
contract should be treated as contractual
obligation
 Power of compulsory arbitration
• The Secretary of Labor and Employment can
require the parties to execute a CBA which
embodies terms and conditions of
employment that it deemed just and fair