Additional Case No.

1: Kiok Loy, doing business under the name and Style Sweden Ice Cream Plant
vs. NLRC and Pambansang Kilusan ng Paggawa
Refusal to bargain as a ULP Art 249(g); and Demand to Bargain Art 251(a)

FACTS: The Pambansang Kilusang Paggawa (Union for short) is a legitimate late labor federation which
won the certification election and was subsequently certified by the BLR as the sole and exclusive
bargaining agent of the rank-and-file employees of Sweden Ice CreamPlant (Company, for short). The
Company filed a motion for reconsideration for the certification which was denied.
Thereafter, the Union furnished the Company with two copies of its proposed collective
bargaining agreement. At the same time, it requested the Company for its counter proposals. Eliciting no
response to the aforesaid request, the Union again wrote the Company reiterating its request for
collective bargaining negotiations and for the Company to furnish them with its counter proposals. Both
requests were ignored and remained unacted upon by the Company.
Left with no other alternative in its attempt to bring the Company to the bargaining table, the
Union, on February 14, 1979, filed a "Notice of Strike", with the Bureau of Labor Relations (BLR) on
ground of unresolved economic issues in collective bargaining.
Conciliation proceedings then followed during the thirty-day statutory cooling-off period. But all
attempts towards an amicable settlement failed, prompting the BLR to certify the case to the NLRC
for compulsory arbitration. The labor arbiter, Andres Fidelino, to whomthe case was assigned, set the
initial hearing for April 29, 1979. For failure however, of the parties to submit their respective position
papers as required, the said hearing was cancelled and reset to another date. Meanwhile, the Union
submitted its position paper. The Company did not, and instead requested for a resetting which was
granted. The Company was directed anew to submit its financial statements for the years 1976,
1977, and 1978.
The case was further reset to May 11, 1979 due to the withdrawal of the Company's counsel of
record, Atty. Rodolfo dela Cruz. On May 24, 1978, Atty. Fortunato Panganiban formally entered his
appearance as counsel for the Company only to request for another postponement allegedly for the
purpose of acquainting himself with the case. Meanwhile, the Company submitted its position paper on
May 28, 1979.
When the case was called for hearing on J une 4, 1979 as scheduled, the Company's
representative, Mr. Ching, who was supposed to be examined, failed to appear. Atty. Panganiban
then requested for another postponement which the labor arbiter denied. He also ruled that the
Company has waived its right to present further evidence and, therefore, considered the case submitted for
resolution.
The labor arbiter submitted its report to the NLRC which rendered the decision declaring the
Company guilty of unjustified refusal to bargain.

ISSUE: Whether Sweden Ice CreamPlant is guilty of the Unfair Labor Practice of unjustified refusal to
bargain.

HELD: Yes, it is. Collective bargaining which is defined as negotiations towards a collective agreement is
one of the democratic frameworks under the New Labor Code, designed to stabilize the relation between
labor and management and to create a climate of sound and stable industrial peace. It is a mutual
responsibility of the employer and the Union and is characterized as a legal obligation. So much so that
Article 249, par. (g) of the Labor Code makes it an unfair labor practice.
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.
Fromthe 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.
The Court is in total conformity with respondent NLRC's pronouncement that petitioner Company
is GUILTY of unfair labor practice. It has been indubitably established that
(1) respondent Union was a duly certified bargaining agent;
(2) it made a definite request to bargain, accompanied with a copy of the
proposed Collective Bargaining Agreement, to the Company not only once but twice
which were left unanswered and unacted upon; and
(3) the Company made no counter proposal whatsoever all of which conclusively
indicate lack of a sincere desire to negotiate.
A Company's refusal to make counter proposal if considered in relation to the entire bargaining
process, may indicate bad faith and this is specially true where the Union's request for a counter proposal
is left unanswered. Even during the period of compulsory arbitration before the NLRC, petitioner
Company's approach and attitude-stalling the negotiation by a series of postponements, non-appearance at
the hearing conducted, and undue delay in submitting its financial statements, lead to no other conclusion
except that it is unwilling to negotiate and reach an agreement with the Union. Petitioner has not at any
instance, evinced good faith or willingness to discuss freely and fully the claims and demands set forth by
the Union much less justify its opposition thereto.
2. PHILIPPINE AIRLINES, INCORPORATED, Petitioner,
vs. PHILIPPINE AIRLINES EMPLOYEES ASSOCIATION (PALEA), Respondent.
G.R. No. 142399 March 12, 2008
FACTS:
On February 6, 1987, PAL and PALEA entered into a CBA covering the period of 1986-1989. Section 3 thereof provides that all the
terms and conditions of employment of employees within the bargaining unit are embodied in this Agreement, and the same shall
govern the relationship between the Company and such employees. x x x Part of said agreement required petitioner PAL to pay its
rank and file employees the following: 13th Month Pay (Mid-year Bonus) equivalent to one months current basic pay, to be paid
in advance in May; and Christmas Bonus which is the equivalent of one months current basic pay as of November 30, to be paid in
December.
On April 22, 1988, prior to the payment of the 13th month pay, PAL released a guideline implementing said provisions, to wit:
1) Eligibility
a) Ground employees in the general payroll who are regular as of April 30, 1988;
b) Other ground employees in the general payroll, not falling within category a) above shall receive their 13th Month
Pay on or before December 24, 1988;
2) Amount
a) For category a) above, one month basic salary as of April 30, 1988;
b) Employees covered under 1 b) above shall be paid not less than 1/12 of their basic salary for every month of service
within the calendar year.
3) Payment Date: May 9, 1988 for category 1 a) above.
PALEA assailed the implementation of the guideline on the ground that all employees of PAL, regular or non-regular, must be paid
their 13th month pay. Subsequently, in a letter, PALEA, through Herbert C. Baldovino, informed PAL that some regular employees
failed to receive their 13th Month Pay.
PAL answered that rank and file employees regularized after April 30, 1988 were not entitled to the 13th month pay as they were
already given their Christmas bonuses on December 9, 1988 per the Implementing Rules of PD 851 (The 13
th
Month Pay Law).
Disagreeing with PAL, PALEA filed a labor complaint for ULP against PAL before the NLRC. The complaint interposed that "the cut-off
period for regularization should not be used as the parameter for granting [the] 13th month pay considering that the law does not
distinguish the status of employment but (sic) the law covers all employees."
LA: dismissed PALEAs complaint, holding that the giving of the particular bonus was said to be merely an additional practice made in
the past.
NLRC: reversed the Decision of the Arbiter, convinced that the 13th month pay or mid-year bonus is distinct from the Christmas
Bonus.
PAL went directly to SC via Petition for Review on Certiorari but was referred to the CA, which dismissed PALs petition and its
subsequent MR.
Hence the instant Petition for Review on Certiorari under Rule 45.
PAL argues that 1) the CBA does not apply to non-regular employees such that any benefits arising from said agreement cannot be
made to apply to them, including the mid-year bonus; and 2) it has always been the company practice not to extend the mid-year
bonus to those employees who have not attained regular status prior to the month of May, when payment of the particular bonus
accrues.
PALEA, however, disputes petitioner PALs allegations and maintains that "[a]ll employees in PAL are entitled to the same benefit as
they are within the same collective bargaining unit and the entitlement to such benefit spills over to even non-union members." Anent
the supposed company practice of PAL not to extend the payment of the 13th month pay or mid-year bonus to non-regular
employees, non-payment of said benefit is considered a diminution of privileges or benefits proscribed by PD 851; that petitioner PAL
misrepresented that the 13th month pay or mid-year bonus is the same as the Christmas bonus when, in actuality, the latter is
entirely different as it is a benefit paid under the provisions of the CBA, while the former is one mandated by law, Presidential Decree
No. 851, in particular.
ISSUES:
1. WON the payment of the 13
th
month pay or mid-year bonus applies to PAL employees regularized after April 30, 1988.
HELD:
YES. A cursory reading of the 1986-1989 CBA of the parties herein will instantly reveal that Art. I, Sec. 3 of said agreement made its
provision applicable to all employees in the bargaining unit, without distinguishing between regular and non-regular employees.
It is a well-settled doctrine that the benefits of a CBA extend to the laborers and employees in the collective bargaining unit, including
those who do not belong to the chosen bargaining labor organization. Otherwise, it would be a clear case of discrimination.
To be entitled to the benefits under the CBA, the employees must be members of the bargaining unit, but not necessarily of the labor
organization designated as the bargaining agent. A "bargaining unit" has been defined as a group of employees of a given employer,
comprised of all or less than all of the entire body of employees, which the collective interest of all the employees, consistent with
equity to the employer, indicates to be the best suited to serve the reciprocal rights and duties of the parties under the collective
bargaining provisions of the law. PALs allegation that the non-regular employees do not belong to the collective bargaining unit and
are thus not covered by the CBA is unjustified and unsubstantiated. PAL excludes certain employees from the benefits of the CBA only
because they have not yet achieved regular status by the cut-off date, April 30, 1988. There is no showing that the non-regular status
of the concerned employees by said cut-off date sufficiently distinguishes their interests from those of the regular employees so as to
exclude them from the collective bargaining unit and the benefits of the CBA.
2. Whether the 13th month pay or mid-year bonus can be equated to the Christmas bonus.
NO.
While employers already paying their employees a 13th month pay or more in a calendar year or its equivalent at the time of the
issuance of PD 851 are already exempted from the mandatory coverage of said law, PAL cannot escape liability in this case by virtue
thereof.
It must be stressed that in the 1986-1989 CBA, petitioner PAL agreed to pay its employees 1) the 13th month pay or the mid-year
bonus, and 2) the Christmas bonus. The 13th month pay, guaranteed by PD 851, is explicitly covered or provided for as the mid-year
bonus in the CBA, while the Christmas bonus is evidently and distinctly a separate benefit. PAL may not be allowed to brush off said
distinction, and unilaterally and arbitrarily declare that for non-regular employees, their Christmas bonus is the same as or equivalent to
the 13th month pay.
PD 851 mandates the payment of the 13th month pay to uniformly provide the low-paid employees with additional income. It but sets
a minimum requirement that employers must comply with. It does not intend, however, to preclude the employers from voluntarily
granting additional bonuses that will benefit their employees. A bonus is an amount granted and paid to an employee for his industry
and loyalty which contributed to the success of the employer's business and made possible the realization of profits. It is an act of
generosity of the employer for which the employee ought to be thankful and grateful. It is also granted by an enlightened employer to
spur the employee to greater efforts for the success of the business and realization of bigger profits. We deem that the Christmas
bonus in this case is of this nature, although, by virtue of its incorporation into the CBA, it has become more than just an act of
generosity on the part of PAL, but a contractual obligation it has undertaken.
3. FVC Labor Union Phil. Transport and General Workers Association vs. SANAMA-FVC-SIGLO

Facts:
On December 22, 1997, the petitioner FVCLU-PTGWO the recognized bargaining agent of the rank-
and-file employees of the FVC Philippines, Incorporated (company) signed a five-year collective bargaining
agreement (CBA) with the company. The five-year CBA period was from February 1, 1998 to January 30,
2003. At the end of the 3
rd
year of the five-year term and pursuant to the CBA, FVCLU-PTGWO and the
company entered into the renegotiation of the CBA and modified, among other provisions, the CBAs
duration. Article XXV, Section 2 of the renegotiated CBA provides that this re-negotiation agreement shall
take effect beginning February 1, 2001 and until May 31, 2003 thus extending the original five-year period of
the CBA by four (4) months.

On January 21, 2003, nine (9) days before the January 30, 2003 expiration of the originally-agreed five-
year CBA term (and four months and nine days away from the expiration of the amended CBA period), the
respondent Sama-Samang Nagkakaisang Manggagawa sa FVC-Solidarity of Independent and General Labor
Organizations (SANAMA-SIGLO) filed before the Department of Labor and Employment (DOLE) a petition for
certification election for the same rank-and-file unit covered by the FVCLU-PTGWO CBA. FVCLU-PTGWO
moved to dismiss the petition on the ground that the certification election petition was filed outside the freedom
period or outside of the sixty (60) days before the expiration of the CBA on May 31, 2003.

Med-arbiter:
On June 17, 2003, Med-Arbiter Arturo V. Cosuco dismissed the petition on the ground that it was filed
outside the 60-day period counted from the May 31, 2003 expiry date of the amended CBA.

Dole Sec:
DOLE Secretary Patricia A. Sto. Tomas sustained SANAMA-SIGLOs position, thereby setting aside
the decision of the Med-Arbiter. She ordered the conduct of a certification election in the company.

CA: Sustained the DOLE Secs decision.

ISSUE: W/N the extension of the life of the CBA extended the exclusive bargaining status as well

SC:
We hold this FVCLU-PTGWO position to be correct, but only with respect to the original five-year
term of the CBA, which, by law, is also the effective period of the unions exclusive bargaining representation
status. While the parties may agree to extend the CBAs original five-year term together with all other CBA
provisions, any such amendment or term in excess of five years will not carry with it a change in the unions
exclusive collective bargaining status. By express provision of the above-quoted Article 253-A, the exclusive
bargaining status cannot go beyond five years and the representation status is a legal matter not for the
workplace parties to agree upon. In other words, despite an agreement for a CBA with a life of more than five
years, either as an original provision or by amendment, the bargaining unions exclusive bargaining status is
effective only for five years and can be challenged within sixty (60) days prior to the expiration of the CBAs
first five years.

As discussed above, this negotiated extension of the CBA term has no legal effect on the FVCLU-
PTGWOs exclusive bargaining representation status which remained effective only for five years ending on the
original expiry date of January 30, 2003. Thus, sixty days prior to this date, or starting December 2, 2002,
SANAMA-SIGLO could properly file a petition for certification election. Its petition, filed on January 21, 2003
or nine (9) days before the expiration of the CBA and of FVCLU-PTGWOs exclusive bargaining status, was
seasonably filed.
4. SMCEU vs Confesor
G.R. No. 111262, September 19, 1996


FACTS: On June 28, 1990, petitioner-union CBA with private respondent San Miguel Corporation (SMC) to take effect upon
the expiration of the previous CBA or on June 30, 1989. In keeping with their vision and long term strategy for business expansion,
SMC management informed its employees in a letter that the company which was composed of four operating divisions namely: (1)
Beer, (2) Packaging, (3) Feeds and Livestocks, (4) Magnolia and Agri-business would undergo a restructuring.
Magnolia and Feeds and Livestock Division were spun-off and became two separate and distinct corporations: Magnolia
Corporation (Magnolia) and San Miguel Foods, Inc. (SMFI). Notwithstanding the spin-offs, the CBA remained in force and effect.
After June 30, 1992, the CBA was renegotiated in accordance with the terms of the CBA and Article 253-A of the Labor
Code. Negotiations started sometime in July, 1992 with the two parties submitting their respective proposals and counterproposals.
During the negotiations, the petitioner-union insisted that the bargaining unit of SMC should still include the employees of
the spun-off corporations: Magnolia and SMFI; and that the renegotiated terms of the CBA shall be effective only for the
remaining period of two years or until June 30, 1994.
Petitioner-union contends that the duration for the non-representation provisions of the CBA should be coterminous with the
term of the bargaining agency which in effect shall be for the remaining two years of the current CBA.
SMC, on the other hand, contended that the members/employees who had moved to Magnolia and SMFI, automatically
ceased to be part of the bargaining unit at the SMC. Furthermore, the CBA should be effective for three years in accordance
with Art. 253-A of the Labor Code.
Unable to agree on these issues with respect to the bargaining unit and duration of the CBA, petitioner-union declared a
deadlock. A Notice of Strike was filed against SMC. In order to avert a strike, SMC requested the NCMB to conduct preventive
mediation. No settlement was arrived at despite several meetings held between the parties.
Private respondents SMC, Magnolia and SMFI filed a petition with the Secretary of Labor praying that the latter assume
jurisdiction over the labor dispute in a vital industry.
The Secretary of Labor issued the assailed Order on February 15, 1993 directing, among others, that the renegotiated terms of the
CBA shall be effective for the period of three (3) years from June 30, 1992; and that such CBA shall cover only the employees of
SMC and not of Magnolia and SMFI.
Dissatisfied, petitioner-union now comes to this Court questioning this Order of the Secretary of Labor.

ISSUE:
1. Whether or not the duration of the renegotiated terms of the CBA is to be effective for three years or for only two years?
2. Whether or not the bargaining unit of SMC includes also the employees of Magnolia and SMFI?

HELD:
1. The duration of the renegotiated term of the CBA is to be effective for 3 years.
ART. 253-A. Terms of a Collective Bargaining Agreement. Any Collective Bargaining Agreement that the parties may
enter into shall, insofar as the representation aspect is concerned, be for a term of five (5) years. ..xxx. All other provisions
of the Collective Bargaining Agreement shall be renegotiated not later than three (3) years after its execution xxx
Article 253-A is a new provision. This was incorporated by Section 21 of Republic Act No. 6715. This new provision states that the
CBA has a term of 5 years instead of 3 years, before the amendment of the law as far as the representation aspect is concerned. All
other provisions of the CBA shall be negotiated not later than three (3) years after its execution. The representation aspect refers to
the identity and majority status of the union that negotiated the CBA as the exclusive bargaining representative of the appropriate
bargaining unit concerned. All other provisions simply refers to the rest of the CBA, economic as well as non-economic provisions,
except representation
As the Secretary of Labor herself observed in the instant case, the law is clear and definite on the duration of the CBA insofar
as the representation aspect is concerned, but is quite ambiguous with the terms of the other provisions of the CBA.
The framers of the law wanted to maintain industrial peace and stability by having both management and labor work
harmoniously together without any disturbance. Thus, no outside union can enter the establishment within five (5) years and
challenge the status of the incumbent union as the exclusive bargaining agent. Likewise, the terms and conditions of employment
(economic and non-economic) cannot be questioned by the employers or employees during the period of effectivity of the CBA. The
CBA is a contract between the parties and the parties must respect the terms and conditions of the agreement. Notably, the framers of
the law did not give a fixed term as to the effectivity of the terms and conditions of employment. It can be gleaned from their
discussions that it was left to the parties to fix the period.
In the instant case, it is not difficult to determine the period of effectivity for the non-representation provisions of the
CBA. Taking it from the history of their CBAs, SMC intended to have the terms of the CBA effective for three (3) years reckoned
from the expiration of the old or previous CBA which was on June 30, 1989.
As a matter of policy the parties are encourages to enter into a renegotiated CBA with a term which would coincide with the
aforesaid five year term of the bargaining representative.
In the event however, that the parties, by mutual agreement, enter into a renegotiated contract with a term of three
(3) years or one which does not coincide with the said 5-year term, and said agreement is ratified by majority of the members
in the bargaining unit, the subject contract is valid and legal and therefore, binds the contracting parties. The same will
however not adversely affect the right of another union to challenge the majority status of the incumbent bargaining agent
within sixty (60) days before the lapse of the original five (5) year term of the CBA.
2. The SMC bargaining unit does not include the employees of Magnolia and SMFI.
Magnolia and SMFI were spun-off to operate as distinct companies. Management saw the need for these transformations in
keeping with its vision and long term strategy. Magnolia and SMFI became distinct entities with separate juridical personalities. Thus,
they can not belong to a single bargaining unit
In determining an appropriate bargaining unit, the test of grouping is mutuality or commonality of interests. The employees
sought to be represented by the collective bargaining agent must have substantial mutual interests in terms of employment and
working conditions as evinced by the type of work they performed.
Considering the spin-offs, the companies would consequently have their respective and distinctive concerns in terms of the
nature of work, wages, hours of work and other conditions of employment. Interests of employees in the different companies perforce
differ. SMC is engaged in the business of beer manufacturing. Magnolia is involved in the manufacturing and processing of dairy
products while SMFI is involved in the production of feeds and the processing of chicken. The nature of their products and scales of
business may require different skills which must necessarily be commensurate by different compensation packages. The different
companies may have different volumes of work and different working conditions. For such reason, the employees of the different
companies see the need to group themselves together and organize themselves into distinctive and different groups. It would then be
best to have separate bargaining units for the different companies where the employees can bargain separately according to their needs
and according to their own working conditions.
Even assuming in gratia argumenti that at the time of the election they were regular employees of San Miguel, nonetheless,
these workers are no longer connected with San Miguel Corporation in any manner because Magnolia has ceased to be a division of
San Miguel Corporation and has been formed into a separate corporation with a personality of its own. This development, which was
brought to our attention by private respondents, necessarily renders moot and academic any further discourse on the propriety of the
elections which petitioners impugn via the present recourse
In view of all the foregoing, we do not find any grave abuse of discretion on the part of the Secretary of Labor in rendering
the assailed Order. Wherefore, the petition is DISMISSED.
Case no. 5 ISAE vs QUISIMBING
Private respondent International School, Inc. (School), pursuant to PD 732, is a domestic educational institution
established primarily for dependents of foreign diplomatic personnel and other temporary residents. The decree
authorizes the School to employ its own teaching and management personnel selected by it either locally or abroad, from
Philippine or other nationalities, such personnel being exempt from otherwise applicable laws and regulations attending
their employment, except laws that have been or will be enacted for the protection of employees. School hires both
foreign and local teachers as members of its faculty, classifying the same into two: (1) foreign-hires and (2) local-hires.
The School grants foreign-hires certain benefits not accorded local-hires. Foreign-hires are also paid a salary rate 25%
more than local-hires.
When negotiations for a new CBA were held on J une 1995, petitioner ISAE, a legitimate labor union and the collective
bargaining representative of all faculty members of the School, contested the difference in salary rates between foreign
and local-hires. This issue, as well as the question of whether foreign-hires should be included in the appropriate
bargaining unit, eventually caused a deadlock between the parties.
ISAE filed a notice of strike. Due to the failure to reach a compromise in the NCMB, the matter reached the DOLE which
favored the School. Hence this petition.
ISSUE:
Whether the foreign-hires should be included in bargaining unit of local- hires.
RULING:
NO. The Constitution, Article XIII, Section 3, specifically provides that labor is entitled to humane conditions of work.
These conditions are not restricted to the physical workplace the factory, the office or the field but include as well the
manner by which employers treat their employees.
Discrimination, particularly in terms of wages, is frowned upon by the Labor Code. Article 248 declares it an unfair labor
practice for an employer to discriminate in regard to wages in order to encourage or discourage membership in any labor
organization.
The Constitution enjoins the State to protect the rights of workers and promote their welfare, In Section 18, Article II of
the constitution mandates to afford labor full protection. The State has the right and duty to regulate the relations
between labor and capital. These relations are not merely contractual but are so impressed with public interest that labor
contracts, collective bargaining agreements included, must yield to the common good.
However, foreign-hires do not belong to the same bargaining unit as the local-hires.
A bargaining unit is a group of employees of a given employer, comprised of all or less than all of the entire body of
employees, consistent with equity to the employer indicate to be the best suited to serve the reciprocal rights and duties of
the parties under the collective bargaining provisions of the law.
The factors in determining the appropriate collective bargaining unit are (1) the will of the employees (Globe Doctrine); (2)
affinity and unity of the employees interest, such as substantial similarity of work and duties, or similarity of compensation
and working conditions (Substantial Mutual Interests Rule); (3) prior collective bargaining history; and (4) similarity of
employment status. The basic test of an asserted bargaining units acceptability is whether or not it is fundamentally the
combination which will best assure to all employees the exercise of their collective bargaining rights.
In the case at bar, it does not appear that foreign-hires have indicated their intention to be grouped together with local-
hires for purposes of collective bargaining. The collective bargaining history in the School also shows that these groups
were always treated separately. Foreign-hires have limited tenure; local-hires enjoy security of tenure. Although foreign-
hires perform similar functions under the same working conditions as the local-hires, foreign-hires are accorded certain
benefits not granted to local-hires such as housing, transportation, shipping costs, taxes and home leave travel
allowances. These benefits are reasonably related to their status as foreign-hires, and justify the exclusion of the former
from the latter. To include foreign-hires in a bargaining unit with local-hires would not assure either group the exercise of
their respective collective bargaining rights.
6. NAFTU vs MALDECOWU-ULGWP >>Krystle Rosales

National Association of Free Trade Unions (NAFTU) vs. Mainit Lumber Development Co.
Workers Union-United Lumber and General Workers of the Philippines (MALDECOWU-
ULGWP)
G.R. No. 79526 December 21, 1990
PARAS, J.: p

FACTS: Mainit Lumber Devt. Co. Workers Union-United Lumber and Gen. Workers of the
Phils. (MALDECOWU-ULGWP for brevity) filed a petition for certification election with the
DOLE to determine the CBA representative of the rank and file employees of Mainit Lumber
Devt. Co., Inc. (MALDECO). The petition alleged, among others that there was no certification
election conducted within 12 months prior to the filing of the petition; the CBA has expired, and
is supported by 101 out of a total of 201 rank & file employees or more than 30% required by
law. The Med-Arbiter granted the petition however, the National Assn. Of Free Trade Unions
(NAFTU) appealed on the ground that while MALDECO was composed of two (2) separate and
distinct bargaining units i.e. Sawmill and Logging Divisions, both the petition and decision
treated them as one. The Bureau of Labor Relations (BLR) affirmed the Arbiters decision so a
certification election was held on separate dates for the Sawmill and Logging Divisions where
MALDECOWU-ULGWP won at a ratio of 146:2. NAFTU protested on allegations of massive
vote buying and with grave & serious threat, force & intimidation which was corroborated by
MALDECO. The Med-Arbiter dismissed the election protest and the appeal of NAFTU to the
BLR and its subsequent motion for reconsideration were denied.

ISSUE: Whether or not the certification election is valid?

HELD: YES. NAFTUs election protest was grounded on only one (1) bargaining
representative in the concluded election instead of two separate units to be represented, i.e. one
each for Logging and Sawmill Divisions. The Court held that in determining the appropriate
bargaining unit, the test of grouping is community or mutuality of interests since the basic test
of an asserted bargaining unit's acceptability is whether or not it is fundamentally the
combination which will best assure to all employees the exercise of their collective bargaining
rights." The petition for certification election was consented and supported by 175 out of 201
employees of MALDECO confirming that they desire only one bargaining representative. The
functions of the Sawmill intertwined with that of the Logging in the same way that the company
needs them both and while there may be difference in the individual assignments, the distinctions
are not that extensive as to warrant the formation of a separate bargaining unit.
The Court affirmed the Resolution of the Bureau of Labor Relations.






7. Picop Resources Incorporated vs Ricardo Dequila et al.

Wilfredo Fruentes- Senior VP of PRI
Respondents, Ricardo Dequilla, Elmo Pabilando, Cesar Atienza, Aniceto Orbeta Jr, and NAMAPRI-
SPFI

The Facts: Pprivate respondents were regular rank-and-file employees of PICOP and members of the
NAMAPRI-SPFL, a duly registered labor organization and existing bargaining agent of the PICOP rank-
and-file employees. PICOP and NAMAPRI-SPFL had a CBA which would expire on May 22, 2000.

The late Atty. Fuentes, then National President of the Southern Philippines Federation of
Labor (SPFL), advised the PICOP management to terminate about 800 employees due to acts of
disloyalty, specifically, for allegedly campaigning, supporting and signing a petition for the certification
of a rival union, the Federation of Free Workers Union (FFW) before the 60-day freedom period and
during the effectivity of the CBA. Such acts of disloyalty were construed to be a valid cause for
termination under the terms and conditions of the CBA. Based on the CBA, the freedom period would
start on March 22, 2000.

Atty. Boniel, Manager of the PICOP Legal and Labor Relations Department, issued a memorandum
directing the employees concerned to explain within seventy-two (72) hours why their employment
should not be terminated due to alleged acts of disloyalty. Upon receiving their explanation letters, Atty.
Boniel endorsed the same to Atty. Fuentes who then requested the termination of 46 employees found
guilty of acts of disloyalty.

PICOP served a notice of termination due to acts of disloyalty to 31 of the 46 employees. Private
respondents were among the 31 employees dismissed from employment by PICOP

Private respondents filed a complaint before the NLRC for Unfair Labor Practice and Illegal
Dismissal with money claims, damages and attorneys fees.

LA Ruling - June 9, 2001, declaring as illegal the termination of the private respondents.

NLRC Ruling- PICOP elevated the LA decision to the NLRC but its appeal was dismissed in
the November 19, 2002 NLRC Resolution.
[5]
On motion for reconsideration, however, the NLRC issued
another resolution,
[6]
dated December 27, 2002, reversing and setting aside its November 19, 2002
Resolution

CA Ruling (I included the explanation ng CA in detailed manner kase eto nadin explanation ng SC sa ruling nila,
para hindi na doblihin) - CA rendered the subject decision reversing and setting aside the December 27,
2002 NLRC resolution and reinstating the June 9, 2001 Decision of the LA.

The CA ruled, among others, that although private respondents signed an authorization for the
filing of the petition for certification election of a rival union, PICOP Democratic Trade Unionist-
Federation of Free Workers (FFW), such act was not a sufficient ground to terminate the employment of
private respondents. It explained:

Imputations of an alleged violation of the CBA should not arise from a vague
and all embracing definition of alleged acts of disloyalty. Neither should it arise from
speculative inferences where no evidence appears from the record that Respondent
NAMAPRI-SPFL expressly defined acts of disloyalty. Signing an authorization for the
filing of the petition for certification election does not constitute an act of disloyalty per se.
There must be proof of contemporaneous acts of resignation or withdrawal of their
membership from the Respondent NAMAPRI-SPFL to which they are members.
Petitioners neither joined nor affiliated with FFW and continuously paid their union dues
with Respondent NAMAPRI-SPFL.

Likewise, the advise of the Respondent NAMAPRI-SPFL to the Respondent PRI
to effect the termination of employees, including herein Petitioners, finds no basis in fact
and in law considering that at the time the Respondent PRI dismissed the Petitioners,
among others, on 16 November 2000, there was no more CBA to speak of after it had
already expired on 22 May 2000.
[9]


CA further agreed with private respondents that Article 256 and not Article 253, of the Labor
Code applied in this case. The CA discussed this point as follows:

The issue of acts of disloyalty relates more to a direct connection on the alleged
violation or breach of loyalty to the majority status of the incumbent union than on
violation of the terms and conditions of the agreement under Article 253. Article 256
provides that at the expiration of the 60-day period reckoned from the expiration date of
the CBA, the employer shall continue to recognize the majority status of the incumbent
bargaining agent only where no petition for certification election is filed. However, a
petition was already filed by the Petitioners, among others, during the 60-day freedom
period. Clearly, from the imports of said provision, it will render nugatory the purpose of
the law providing for a freedom period for the filing of a petition for certification election
should the act of signing/filing the said petition be interpreted as an act of disloyalty and
will render farce the need for a certification election as an instrument of ascertaining the
true expression of the will of the workers as to which labor organization would represent
them.

To construe the provision of law in Article 253 as imposing a restriction against
the signing and filing a petition for certification election during the freedom period, is to
violate the constitutional right of the employees to organize freely.

PICOP filed this petition for review.

ISSUE:
1. WON the act of signing an authorization for certification election before the freedom period is an act of
disloyalty

2. WON Article 256 of the Labor Code applies in the case.

HELD: The petition merits a denial.

1. No. There is no question that in the CBA entered into by the parties, there is a union security clause.
The clause imposes upon the workers the obligation to join and maintain membership in the companys
recognized union as a condition for employment.

"Union security" is applied to and comprehends "closed shop," "union shop,"
"maintenance of membership," or any other form of agreement which imposes upon
employees the obligation to acquire or retain union membership as a condition affecting
employment. There is union shop when all new regular employees are required to join
the union within a certain period as a condition for their continued employment. There is
maintenance of membership shop when employees, who are union members as of the
effective date of the agreement, or who thereafter become members, must maintain union
membership as a condition for continued employment until they are promoted or
transferred out of the bargaining unit, or the agreement is terminated. A closed shop, on
the other hand, may be defined as an enterprise in which, by agreement between the
employer and his employees or their representatives, no person may be employed in any
or certain agreed departments of the enterprise unless he or she is, becomes, and, for the
duration of the agreement, remains a member in good standing of a union entirely
comprised of or of which the employees in interest are a part.
[13]



The burden of proof rests upon management to show that the dismissal of its worker was based
on a just cause. When an employer exercises its power to terminate an employee by enforcing the union
security clause, it needs to determine and prove the following: (1) the union security clause is applicable;
(2) the union is requesting for the enforcement of the union security provision in the CBA; and (3) there is
sufficient evidence to support the decision of the union to expel the employee from the union.
[14]


Acts of private respondents are not enough proof of a violation of the Union Security Clause
which would warrant their dismissal. (Lahat ng sinabe ng CA as to this issue was upheld by the SC so
paki basa nlng ung nasa FACTS under CA RULING as the explanation for this ruling by the SC.)

We are constrained to believe that an "authorization letter to file a petition for certification
election" is different from an actual "Petition for Certification Election." It is clear that the actual Petition
for Certification Election of FFW was filed only on May 18, 2000. Thus, it was within the ambit of the
freedom period which commenced from March 21, 2000 until May 21, 2000. Strictly speaking, what is
prohibited is the filing of a petition for certification election outside the 60-dayfreedom period. This is not
the situation in this case. If at all, the signing of the authorization to file a certification election was merely
preparatory to the filing of the petition for certification election, or an exercise of respondents right to
self-organization


2. Yes. The Court agrees with the CA that its (PICOPs) argument is misplaced. (Under the CA RULING
ulit ung explanation dito, paki basa nlng ulit ung nasa FACTS.)

While it is incumbent for the employer to continue to recognize the majority status of the incumbent
bargaining agent even after the expiration of the freedom period, they could only do so when no petition
for certification election was filed. The reason is, with a pending petition for certification, any such agreement
entered into by management with a labor organization is fraught with the risk that such a labor union may not be
chosen thereafter as the collective bargaining representative.

Moreover, the last sentence of Article 253 which provides for automatic renewal pertains only to
the economic provisions of the CBA, and does not include representational aspect of the CBA. An existing
CBA cannot constitute a bar to a filing of a petition for certification election. When there is a
representational issue, the status quo provision in so far 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.

Private respondents are also entitled to an award of attorneys fees equivalent to 10% of the total
monetary award as they were compelled to litigate in order to seek redress for their illegal dismissal.


8. NUWHRAIN v Secretary of Labor

Facts: National Union of Workers in Hotels, Restaurants and Allied Industries Manila Pavilion Hotel Chapter (NUWHRAIN-
MPHC), herein petitioner, seeks the reversal of the Court of Appeals November 8, 2007 Decision and of the Secretary of Labor
and Employments January 25, 2008 Resolution in OS-A-9-52-05 which affirmed the Med-Arbiters Resolutions dated January
22, 2007 and March 22, 2007.

A certification election was conducted on June 16, 2006 among the rank-and-file employees of respondent Holiday Inn
Manila Pavilion Hotel (the Hotel) with the following results:

EMPLOYEES IN VOTERS LIST =353
TOTAL VOTES CAST =346
NUWHRAIN-MPHC =151
HIMPHLU =169
NO UNION = 1
SPOILED = 3
SEGREGATED = 22

SOLE concluded that the certification of HIMPHLU as the exclusive bargaining agent was proper.
Petitioner, which garnered 151 votes, appealed to the Secretary of Labor and Employment (SOLE), arguing that the votes of the
probationary employees should have been opened considering that probationary employee Gatbontons vote was tallied. And
petitioner averred that respondent HIMPHLU, which garnered 169 votes, should not be immediately certified as the bargaining
agent, as the opening of the 17 segregated ballots would push the number of valid votes cast to 338 (151 +169 +1 +17), hence,
the 169 votes which HIMPHLU garnered would be one vote short of the majority which would then become 169.

Issue: WON HIMPHLU is the winner of the certification election

Held: No.As to whether HIMPHLU should be certified as the exclusive bargaining agent, the Court rules in the negative. It is
well-settled that under the so-called "double majority rule," for there to be a valid certification election, majority of the bargaining
unit must have voted AND the winning union must have garnered majority of the valid votes cast.
Prescinding from the Courts ruling that all the probationary employees votes should be deemed valid votes while that of
the supervisory employees should be excluded, it follows that the number of valid votes cast would increase from 321 to 337.
Under Art. 256 of the Labor Code, the union obtaining the majority of the valid votes cast by the eligible voters shall be certified
as the sole and exclusive bargaining agent of all the workers in the appropriate bargaining unit. This majority is 50% +1. Hence,
50% of 337 is 168.5 +1 or at least 170.
HIMPHLU obtained 169 while petitioner received 151 votes. Clearly, HIMPHLU was not able to obtain a majority vote.
The position of both the SOLE and the appellate court that the opening of the 17 segregated ballots will not materially affect the
outcome of the certification election as for, so they contend, even if such member were all in favor of petitioner, still, HIMPHLU
would win, is thus untenable.
It bears reiteration that the true importance of ascertaining the number of valid votes cast is for it to serve as basis for
computing the required majority, and not just to determine which union won the elections. The opening of the segregated but valid
votes has thus become material. To be sure, the conduct of a certification election has a two-fold objective: to determine the
appropriate bargaining unit and to ascertain the majority representation of the bargaining representative, if the employees desire to
be represented at all by anyone. It is not simply the determination of who between two or more contending unions won, but
whether it effectively ascertains the will of the members of the bargaining unit as to whether they want to be represented and
which union they want to represent them.
Having declared that no choice in the certification election conducted obtained the required majority, it follows that a
run-off election must be held to determine which between HIMPHLU and petitioner should represent the rank-and-file employees.