The TU and CB Cycle: Union Recognition CBA Negotiation/ Conclusion

The Philippine Model
The TU and CB cycle
CBA
UNION Year 1
NEGOTIATION/
RECOGNITION
CONCLUSION
Year 5
PROTECTION
AGAINST ULPs; CBA ADMINIS-
UNION
CONTINUING TRATION
FORMATION
DUTY TO BARGAIN
IN GOOD FAITH
CBA RENEGO-
CBA ADMINIS- Year 3
TIATION/
TRATION
CONCLUSION
BERBitonioJr/TU&CB Workshop/01-2015
The Philippine Model
The trade union structure

Three levels of unionism, one level of collective bargaining -
 PEAK ORGANIZATION
 Engages in political unionism
 Assists or acts as agent in enterprise collectiveTrade Union Center
bargaining
 Sits in policymaking bodies
 FEDERATION
 Assists or acts as agent in
enterprise collective bargaining
 Sits in policy making bodies
Industry or National
General Union
Union
 ENTERPRISE UNION
 Principal in enterprise
collective bargaining
Context of TU and CB
Employment growth by sector
Sector GDP Growth Employment

Rate (%) Growth Rate (%)
Agriculture 1.1 -2.8
Industry 9.5 3.0
Services 7.1 2.4
All Sectors 7.2 0.8
 High GDP growth rate with low employment creation

(jobless growth).
 Structural nature of employment problem.
Context of TU and CB
Labor market dualism persists
Labor market dualism persists, leaning increasingly toward

non-standard employment arrangements and informalization.
FORMAL SECTOR
Precarious employment
(Wage and salary)
Private establishment Private household
17.033 million 1.959 million Own family-operated
farm or business
0.127 million
Gov’t/GOCC Employer
3.018 million 1.263 million
INFORMAL SECTOR Vulnerable employment

Self-employed Unpaid family
10.610 million workers
3.908 million
Policy outcomes
Union growth is stagnant to slow

1.855 M union members in 2013: 1.392 M in 16,638 enterprise-
based private sector and 463,000 in 1,769 public sector unions.
Year New Total Total membership Total Total
unions unions (private) and % of unions membership
(private) (private) wage sector (public) (public)
2007 260 17,021 1, 917,707 (11%) 1,563 334,319
2008 279 17,305 1,941,727 (10.9%) 1,628 343,477
2009 384 17,665 1,985,467 (10.6%) 1,676 356,279
2010 335 17,973 1,713,593 (8.7%) 1,706 360,680
2011 297 18,242 1,778,824 (8.7%) 1,709 402,851
2012 189 18,428 1,833,341 (8.5%) 1,742 446,044
Policy outcomes
TU density and membership continue
falling
Total employment and union membership, 2004 -2013 (in 000)
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
02004 2009 2011 2013
Trade union density, 2004-2013 (in %)

25
20
15
10
5
02004 2009 2011 2013
Policy outcomes
CB coverage stagnant, CBC rate falling

Collective bargaining coverage, 2003-2013 (in 000)
600
500
400
300
200
100
02003 2004 2006 2008 2010 2012
Collective bargaining coverage rate, 2003-2013 (in %)

25
20
15
10
5
02003 2004 2008 2010 2012
Policy outcomes
TU and CB activities concentrated in
urbanized regions where W&S sector is
larger
Direct correlation between urbanization and
trade union and collective bargaining activity.
 9,898 unions (59% of all enterprise-based
private sector unions) with 1.069 members
(76.8%) are in NCR.
 2,122 unions with 180,000 members in
CALABARZON.
 1,068 unions with 98,000 members in Central
Luzon.
Policy outcomes
Organizing for new unions is limited

Only a few new unions in urbanized regions, none in
the less urbanized.
99 new unions with 4,447 members were
registered in 2013, mostly in NCR.
No newly registered unions in CAR and Regions I,
II, VIII, IX, CARAGA and ARMM.
Hardly any evidence of new organizing activity in
Regions IV-B, X and XI (one new union each).
Slight increase in number of unions and members, but
lower union membership-to-employment ratio.
Policy outcomes
Fewer certification elections year on year

211 original Med-Arb cases, mostly PCEs, were in the
dockets in 2013. 96 cases were on appeal.
2010: 312 PCEs
2006: 489 PCEs
2005: 517 PCEs
Of the 211 cases, 138 were disposed, with 102 granted
and 38 dismissed/withdrawn.
2012 and 2011 (258/301 and 235/278, respectively).
Of the 195 newly-filed original cases, 116 were in NCR,
21 in Region III, and 14 in CALABARZON. No cases in
CAR and Regions I, II, III, IV-B, IX and X.
Policy outcomes
Number and coverage of CBAs decreasing

We are losing more CBAs than gaining new ones. Loss of CBAs
mostly due to company closures.
Year Newly-filed Coverage Total CBAs Total coverage
2005 459 82,925 2,973 556,000
2006 536 60,790 2,700 235,887
2007 318 44,375 1,542 218,128
2008 307 55,290 1,4566 227,403
2009 453 74,924 1,394 225,167
2010 540 87,445 1,413 212,054
2011 475 77,944 1389 227,620
2012 365 58,138 1,327 219,899
Policy outcomes
Where CB happens, no evidence

of distributional impact
. . . Increase in proportion of wage and salary workers in recent years
did not increase CB coverage . . .
70
60
. . . and increase in 50
wage share to GDP 40
cannot be attributed 30
20
to CB.
10
02003 2004 2008 2010 2012
Policy outcomes
Industrial peace, or simply no voice?
Fewer union and collective bargaining activity

directly correlated with less collective disputes.
177 NOS/NOL, with 149 new cases, were filed in 2013.
 274 and 184 NOS/NOL in the dockets in 2012 and 2011.
One actual strike in 2013; 1,000 man-days lost.
 5 strikes and 5,000 man-days lost in 2011 and 2012.
Total PM and VA cases decreased from 2011 to 2013.
 PM from 585 to 484.
 VA from 249 to 230.
Toward a strategic framework
POLICY PERFORMANCE IS POOR.

NO NEED TO CHANGE POLICY GOALS AND
OBJECTIVES. . .
 The ENDS are fundamental and universal which all
free and democratic societies seek to achieve.
. . . BUT THE MEANS TO ACHIEVE THESE ARE NO
LONGER EFFECTIVE.
 Strategic transformation should aim to re-design the
TU/CB model, especially the characteristics which
constrain FoA, TU and CB.
Toward a strategic framework
Variations in TU and CB outcomes

H
CB coverage
TU density
CB coverage
TU density
High TU density
T
High CB coverage
High TU density
HighHigh
LowLow
High CB coverage
U
D
E
N t
S
I
T
Y
HighHigh
LowLow
CB coverage
TU density
Low CB coverage
Low TU density
CB coverage
TU density
Low CB coverage
Low TU density
L
CB COVERAGE
Samples from around the world

H
T  Italy
U  Belarus
 Cuba
D  Denmark
E  Finland
N  Norway
 Belgium
S
 South Africa  Austria
I  Singapore Canada
 UK  Brazil
T  NZ
 US
 Aus  Germany
Y  Malaysia  France
L CB COVERAGE
How the Philippines compares

H
T  Italy
U  Belarus
D  Cuba
 Denmark
E
 Finland
N  Norway
 Belgium
S
I  South Africa  Austria
 Singapore Canada
 UK
T  NZ  Aus  Germany  Brazil
 US
Y  Malaysia  France
 Philippines
L CB COVERAGE
Samples from around the world

TU density and CB coverage from various countries: International
Statistical Inquiry, 2008-2009, ILO (2010)
120
100
80
60
40
20
Trade union density Collective bargaining coverage rate

Lessons from the samples

There are correlations between economic and labor
market factors and TU and CB outcomes -
 Positive correlation between level of economic
development and higher TU density (HIGH TUD) and
CB coverage rates (HIGH CBC).
. . . but high level of development does not guarantee
HIGH TUD/HIGH CBC .
 Positive correlation between large formal sector and
HIGH TUD/HIGH CBC.
 Inverse correlation between informality and HIGH
TUD/HIGH CBC.
Lessons from the samples

Political structures with a defined role for unions
positively influence TU and CB outcomes. Countries
moving toward HIGH TUD and HIGH CBC -
 Tend to have labor parties or institutionalized
role of unions in political decision-making.
 Tend to be guided by the post-WWII social
bargain.
 Are or tend to have elements of the welfare
State.
 Tend to be parliamentary democracies.
 Have long experience with C. 87 and C. 98.
TU and CB model plays a key role

Similar characteristics, similar outcomes -
H
 Transition economy  Developed economy
 Large public sector employment  Large formal sector
and State-owned enterprises  Peak organizations
 State-led organizations with  Corporatist and democratic coalitions
compulsory membership  Coordinated, multi-level CB model
 Undeveloped CB structure  Employee termination must be for cause
 Evolving labor law  Ergo omnes provisions
 Developed economy
 Developed or developing economies  Large formal sector
 Large or small informal sector  Peak organizations
 Union pluralism  Democratic and competitive
 Decentralized CB model representation
 Democratic and competitive  Coordinated, multi-level CB model
representation  Employee termination must be for cause
 Ergo omnes provisions
L BERBitonioJr/TU&CB Workshop/01-2015
Developing a strategy
for transformation
All TU/CB models expressly aim to promote FoA, TU
and CB. However -
 As local and international experience show, the
elements and characteristics of a particular
model may, in operation, frustrate its stated
goals and objectives.
 Procedures may have the unintended
consequence of rendering ineffective explicit
substantive rights.
Developing a transformation strategy
Recent reform initiatives
Recent reform initiatives follow a “piecemeal”

approach of amending the Labor Code.
R.A. 9347 (2007), Rationalizing the composition of
the NLRC
R.A. 9481 (2007), Strengthening workers’
Constitutional right to self-organization
R.A. 10395 (2013), Strengthening tripartism
R.A. 10396 (2013), Strengthening conciliation and
mediation
These reforms are procedural in nature.
Planned reform initiatives

Planned reform initiatives contained in PLEP continue
with the “piecemeal” approach –
 Reducing minimum membership requirements and
number of unions required to form a federation
 Repeal of prohibition against unions to receive
foreign assistance
 Strengthening the rights of non-regular workers in
the informal economy to self-organization
 Passage of Magna Carta for Workers in the Informal
Economy
Planned reform initiatives
Planned reform initiatives contained in PLEP continue

with the “piecemeal” approach -
 Amendment of Arts. 213-233 of the Labor Code
“toward introducing reforms” in the NLRC
 Direct appeal of VA and NLRC cases to SC
 Amendment of compulsory arbitration provisions
on national interest cases.
Nature and scope of initiatives
Stated general direction of recent and planned

reforms is to align the laws with ILO Conventions.
However -
 Reform initiatives are focused only on the first and
fourth core elements (FoA and TU rights and dispute
resolution).
 No initiatives on the second and third core elements
(representation and structure and scope of CB).
 All the initiatives are procedural in nature.
The case for a transformational model

In all, the initiatives tend TO PRESERVE AND
SOLIDIFY the existing model, NOT TO TRANSFORM it.
Time to rethink “piecemeal” approach and develop
one that is more strategic, purposeful and
coordinated.
Tripartite partners should draw lessons and guidance
from national and international experience.
Look BEYOND THE CURRENT MODEL. ELIMINATE THE
CONSTRAINING ELEMENTS AND CHARACTERISTICS.
Identifying the constraints (1)

CORE ELEMENT CHARACTERISTICS
First element:  Eligibility for TU membership conditioned on
Recognition, employment status and classification
promotion and  Minimum requirements for TU to acquire legal
regulation of personality
FoA and TU  State-administered registration system
rights  Pluralist, decentralized and enterprise-based
TU structure
 Protection against anti-union discrimination,
coercion and ULPs
 Formal recognition of right to federate or form
central organizations for TUs, informal
recognition for employers
Eligibility for TU membership

Within a standard Ee-Er relationship, eligibility
requirements can actually restrict FoA rights -
Ineligibility of managers and eligibility of
supervisors
 In point: United Pepsi-Cola Supervisory Union v.
Laguesma, G. R. No. 122226, 25 March 1998.
Disguised ineligibility: an employer includes any
person acting in the interest of the employer.
Practice of excluding specific groups or non-
regular employees deemed eligible by law.
Eligibility for TU membership

Within an Ee-Er relationship, but under a non-
standard employment arrangement (including
subcontracting): legal recognition of eligibility has
little practical impact.
Within an Ee-Er relationship simultaneously with
some other relationship: disqualification of
employees in cooperatives who are also members
thereof.
Outside an Ee-Er relationship: the unemployed, own
account workers and the informal sector.

Second element:  Enterprise-based bargaining units
Recognition,  Membership in bargaining units based on
promotion and common employee classification and interests
regulation of  Democratic and competitive selection, thru
CB rights certification election, of the union which will
serve as the sole and exclusive bargaining
representative for workers
 Fixed term of representation
 Multi-level appellate recourse to question
selection of bargaining representative
Bargaining unit determination

In spite of explicit preference for a “one employer, one
bargaining unit policy,” bargaining units have become
smaller.
Legal principle that determination of BU and employee
classification is a prejudicial issue to CB can work as an
obstacle to actual CB.
 In point: San Miguel Supervisors and Exempt Employees
Union v. Laguesma, G.R. No. 110399, 15 Aug. 1997, and G.
R. No. 146206, 01 Aug., 2011.
“Inclusion-exclusion” proceedings and “double appeal”
in PCEs are the graveyard of unions.
Exclusivity of representation
Is a certification election the only way to express the

employees’ choice of CB representative?
Should representation be always exclusive to one union?
With the proposal for industry or other forms of
bargaining outside the enterprise, how will
representation be determined?
Where there is more than one union in a B.U., will
composite or coalitional rather than exclusive
representation facilitate CB?

Third element:  Decentralized and enterprise-based structure
Structure,  Formal recognition of duty to bargain in good
process, scope faith, with guidelines on bargaining process
and content of  Protection against bad faith bargaining and
CB related forms of ULP
 Fixed term of CBA; periodic nature of
bargaining
 Minimum labor standards are baselines to CB
 Binding between the parties within the BU,
non-extendible to workers outside the BU
 Recognition of union security clauses
 Minimum State intervention in the CB process
Enterprise level bargaining
Key issues -
 Coverage of CB and application of employee
classifications
 A possible trend toward smaller bargaining units
and more exclusions
 Term of CBA (3-2, 3-3 or simply 3): Term confers
workers the legal right to review the terms of the
CBA at regular and periodic intervals.
 In counter-point: Rivera v. Espiritu, G. R. No. 15547, 23
January 2002.
Higher level bargaining
Key issues in formulating an institutional mechanism

for bargaining outside the enterprise level –
 Coverage of CB and application of employee
classifications
 Choice of representation
 Should there be representation even without TU
membership?
 Nature of agreements: framework or binding?
 Scope of application: exclusive to signatories or with
ergo omnes application?

Fourth element :  Classification of disputes: bargaining deadlocks,
Dispute gross violation or implementation or
settlement interpretation of CBA provisions
 Requirements for strike and lockout;
consequences for non-compliance
 Sequential principles in dispute settlement
• Shared responsibility: parties to resolve their
dispute thru consensus
• Outside the enterprise, preferred mode is
conciliation, mediation and VA. Compulsory
arbitration for national interest cases
 Multi-level appellate and judicial recourse
Labor disputes
Definition of strike now includes instances where
workers do not actually withhold their labor.
 In point: NUWHRAIN Dusit Hotel Nikko Chapter v.
Court of Appeals, G. R. No. 166295, 11 November 2008.
Proposal to make voluntary arbitrator’s decision
directly appealable to the Supreme Court –
 Pro: Shortens the appellate process
 Cons: Undermines binding nature of VA; in turn
undermines CB; may create a perverse incentive
for parties not to submit to VA.
Building on what we have

Some institutionalized tripartite and social dialogue
processes are forms of bargaining outside the enterprise
 Wage fixing
 Specialized regulations for non-standard work
arrangements (subcontracting)
 Specialized industry regulations (construction and security
industries)
 Specialized regulations on hazardous work
 Multi-employer employment contracts with international
application (standard employment contract for seafarers)
Drawing from other instruments

In considering policy options, tripartite partners
should not be confined to the current model or to the
terms of C. 87 and C. 98.
Other instruments, even those not ratified by the
Philippines, are instructive –
 C. 154 (Collective Bargaining Convention, 1981)
 R. 163 (Collective Bargaining Recommendation,
1981)
 R. 91 (Collective Agreements Recommendation,
1951)
From CBA to COLLECTIVE AGREEMENTS

A broader conceptualization from CBA to collective
agreements will still be within the framework of C. 87, C.
98, tripartism and social dialogue –
 “Collective agreements” means all agreements in writing
regarding working conditions and terms of employment
concluded between an employer, a group of employers or
one or more employers' organisations, on the one hand,
and one or more representative workers' organisations,
or, in the absence of such organisations, the
representatives of the workers duly elected and
authorised by them in accordance with national laws and
regulations, on the other.” (ILO R. 91)
Targeting strategic goals and

outcomes, one step
at a time
Long term
Influence
Short term Mid term
Partnership
Redistribution
New model > TU density
Social>justice
Education CB coverage BERBitonioJr/TU&CB Workshop/01-2015
THANK YOU
FOR YOUR ATTENTION!

The TU and CB Cycle: Union Recognition CBA Negotiation/ Conclusion

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The TU and CB Cycle: Union Recognition CBA Negotiation/ Conclusion

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The Philippine Model

The TU and CB cycle

The trade union structure

Employment growth by sector

Sector GDP Growth Employment

 High GDP growth rate with low employment creation

Labor market dualism persists

Labor market dualism persists, leaning increasingly toward

INFORMAL SECTOR Vulnerable employment

Union growth is stagnant to slow

2012 189 18,428 1,833,341 (8.5%) 1,742 446,044

Trade union density, 2004-2013 (in %)

CB coverage stagnant, CBC rate falling

Collective bargaining coverage rate, 2003-2013 (in %)

Organizing for new unions is limited

Fewer certification elections year on year

Number and coverage of CBAs decreasing

Where CB happens, no evidence

Industrial peace, or simply no voice?

Fewer union and collective bargaining activity

POLICY PERFORMANCE IS POOR.

Variations in TU and CB outcomes

Samples from around the world

How the Philippines compares

Samples from around the world

Trade union density Collective bargaining coverage rate

Lessons from the samples

Lessons from the samples

TU and CB model plays a key role

Recent reform initiatives

Recent reform initiatives follow a “piecemeal”

Planned reform initiatives

Planned reform initiatives

Planned reform initiatives contained in PLEP continue

Nature and scope of initiatives

Stated general direction of recent and planned

The case for a transformational model

Identifying the constraints (1)

Eligibility for TU membership

Eligibility for TU membership

Identifying the constraints (2)

Bargaining unit determination

Is a certification election the only way to express the

Identifying the constraints (3)

Enterprise level bargaining

Higher level bargaining

Key issues in formulating an institutional mechanism

Identifying the constraints (4)

Building on what we have

Drawing from other instruments

From CBA to COLLECTIVE AGREEMENTS

Targeting strategic goals and

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