Republic of the Philippines

SUPREME COURT
Manila

SECOND DIVISION
S.S. VENTURES INTERNATIONAL, G.R. No. 161690
INC.,
Petitioner,
Present:
- versus -

QUISUMBING, J., Chairperson,

YNARES-SANTIAGO,*
CARPIO MORALES,
TINGA, and
VELASCO, JR., JJ.

S.S. VENTURES LABOR UNION

(SSVLU) and DIR. HANS LEO
Promulgated:
CACDAC, in His capacity as
Director of the Bureau of Labor
July 23, 2008
Relations (BLR),
Respondents.
x-----------------------------------------------------------------------------------------x
DECISION
VELASCO, JR., J.:
Petitioner S.S. Ventures International, Inc. (Ventures), a PEZA-registered
export firm with principal place of business at Phase I-PEZA-Bataan Export Zone,
Mariveles,Bataan, is in the business of manufacturing sports shoes. Respondent
S.S. Ventures Labor Union (Union), on the other hand, is a labor organization
registered with the Department of Labor and Employment (DOLE) under
Certificate of Registration No. RO300-00-02-UR-0003.

On March 21, 2000, the Union filed with DOLE-Region III a petition
for certification election in behalf of the rank-and-file employees of
Ventures. Five hundred forty two (542) signatures, 82 of which belong to
______________________
* Additional member as per Special Order No. 509 dated July 1, 2008.

terminated Ventures employees, appeared on the basic documents supporting the

petition.
On August 21, 2000, Ventures filed a Petition[1] to cancel the Unions
certificate of registration invoking the grounds set forth in Article 239(a) of the
Labor Code.[2] Docketed as Case No. RO300-0008-CP-002 of the same DOLE
regional office, the petition alleged the following:
(1) The Union deliberately and maliciously included the names of more or
less 82 former employees no longer connected with Ventures in its list of members
who attended the organizational meeting and in the adoption/ratification of its
constitution and by-laws held on January 9, 2000 in Mariveles, Bataan; and the
Union forged the signatures of these 82 former employees to make it appear they
took part in the organizational meeting and adoption and ratification of the
constitution;
(2) The Union maliciously twice entered the signatures of three persons
namely: Mara Santos, Raymond Balangbang, and Karen Agunos;
(3) No organizational meeting and ratification actually took place; and
(4) The Unions application for registration was not supported by at least
20% of the rank-and-file employees of Ventures, or 418 of the total 2,197employee complement. Since more or less 82 of the 500 [3] signatures were forged
or invalid, then the remaining valid signatures would only be 418, which is very
much short of the 439 minimum (2197 total employees x 20% = 439.4) required
by the Labor Code.[4]
In its Answer with Motion to Dismiss,[5] the Union denied committing the
imputed acts of fraud or forgery and alleged that: (1) the organizational meeting
actually took place on January 9, 2000 at the Shoe City basketball court in

Mariveles; (2) the 82 employees adverted to in Ventures petition were qualified

Union members for, although they have been ordered dismissed, the one-year
prescriptive period to question their dismissal had not yet lapsed; (3) it had
complied with the 20%-member registration requirement since it had 542
members; and (4) the double signatures were inadvertent human error.
In its supplemental reply memorandum[6] filed on March 20, 2001, with
attachments, Ventures cited other instances of fraud and misrepresentation,
claiming that the affidavits executed by 82 alleged Union members show that
they were deceived into signing paper minutes or were harassed to signing their
attendance in the organizational meeting. Ventures added that some employees
signed the affidavits denying having attended such meeting.
In a Decision dated April 6, 2001, Regional Director Ana C. Dione of
DOLE-Region III found for Ventures, the dispositive portion of which reads:
Viewed in the light of all the foregoing, this office hereby grants
the petition. WHEREFORE, this office resolved to CANCEL Certificate
of Registration No. [RO300-00-02-UR-0003] dated 28 February 2000 of
respondent S.S. Ventures Labor Union-Independent.
So Ordered.[7]

Aggrieved, the Union interposed a motion for reconsideration, a recourse

which appeared to have been forwarded to the Bureau of Labor Relations
(BLR). Although it would later find this motion to have been belatedly filed, the
BLR, over the objection of Ventures which filed a Motion to Expunge, gave it due
course and treated it as an appeal.
Despite Ventures motion to expunge the appeal,[8] the BLR Director
rendered on October 11, 2002 a decision[9] in BLR-A-C-60-6-11-01, granting
the Unions appeal and reversing the decision of Dione. The fallo of the BLRs
decision reads:

WHEREFORE, the appeal is hereby GRANTED. The Decision

of Director Ana C. Dione dated 6 April 2001 is hereby REVERSED and
SET ASIDE. S.S. Ventures Labor Union-Independent shall remain in the
roster of legitimate labor organizations.
SO ORDERED.[10]

Ventures sought reconsideration of the above decision but was denied by

the BLR.
Ventures then went to the Court of Appeals (CA) on a petition for certiorari
under Rule 65, the recourse docketed as CA-G.R. SP No. 74749. On October 20,
2003, the CA rendered a Decision,[11] dismissing Ventures petition. Ventures
motion for reconsideration met a similar fate.[12]
Hence, this petition for review under Rule 45, petitioner Ventures raising
the following grounds:
I.
PUBLIC RESPONDENT ACTED RECKLESSLY AND
IMPRUDENTLY, GRAVELY ABUSED ITS DISCRETION AND
EXCEEDED ITS JURISDICTION IN DISREGARDING THE
SUBSTANTIAL AND OVERWHELMING EVIDENCE ADDUCED
BY THE PETITIONER SHOWING THAT RESPONDENT UNION
PERPETRATED FRAUD, FORGERY, MISREPRESENTATION AND
MISSTATEMENTS IN CONNECTION WITH THE ADOPTION AND
RATIFICATION OF ITS CONSTITUTION AND BY-LAWS, AND IN
THE PREPARATION OF THE LIST OF MEMBERS WHO TOOK
PART IN THE ALLEGED ORGANIZATIONAL MEETING BY
HOLDING THAT:
A.
THE 87 AFFIDAVITS OF ALLEGED UNION
MEMBERS HAVE NO EVIDENTIARY WEIGHT.
B.

THE INCLUSION OF THE 82 EMPLOYEES IN

THE LIST OF ATTENDEES TO THE JANUARY 9, 2000
MEETING IS AN INTERNAL MATTER WITHIN THE
AMBIT OF THE WORKERS RIGHT TO SELFORGANIZATION AND OUTSIDE THE SPHERE OF
INFLUENCE
(OF)
THIS
OFFICE
(PUBLIC
RESPONDENT IN THIS CASE) AND THE
PETITIONER.
II.
PUBLIC RESPONDENT ACTED RECKLESSLY AND
IMPRUDENTLY, GRAVELY ABUSED ITS DISCRETION AND
EXCEEDED
ITS
JURISDICTION
IN
IGNORING
AND
DISREGARDING THE BLATANT PROCEDURAL LAPSES OF THE
RESPONDENT UNION IN THE FILING OF ITS MOTION FOR
RECONSIDERATION AND APPEAL.
A.
BY GIVING DUE COURSE TO THE MOTION FOR
RECONSIDERATION
FILED
BY
THE
RESPONDENT UNION DESPITE THE FACT THAT IT
WAS FILED BEYOND THE REGLEMENTARY
PERIOD.
B.
BY ADMITTING THE APPEAL FILED BY ATTY.
ERNESTO R. ARELLANO AND HOLDING THAT THE
SAME DOES NOT CONSTITUTE FORUM SHOPPING
UNDER SUPREME COURT CIRCULAR NO. 28-91.
III.
PUBLIC RESPONDENT ACTED RECKLESSLY AND
IMPRUDENTLY, GRAVELY ABUSED ITS DISCRETION AND
EXCEEDED
ITS
JURISDICTION
IN
INVOKING
THE
CONSTITUTIONAL RIGHT TO SELF-ORGANIZATION AND ILO
CONVENTION NO. 87 TO JUSTIFY THE MASSIVE

FRAUD, MISREPRESENTATION,
MISSTATEMENTS
FORGERY COMMITTED BY THE RESPONDENT UNION.[13]
The petition lacks merit.

AND

The right to form, join, or assist a union is specifically protected by Art.

XIII, Section 3[14] of the Constitution and such right, according to Art. III, Sec. 8 of
the Constitution and Art. 246 of the Labor Code, shall not be abridged. Once
registered with the DOLE, a union is considered a legitimate labor organization
endowed with the right and privileges granted by law to such organization. While a
certificate of registration confers a union with legitimacy with the concomitant
right to participate in or ask for certification election in a bargaining unit, the
registration may be canceled or the union may be decertified as the bargaining unit,
in which case the union is divested of the status of a legitimate labor organization.
[15]
Among the grounds for cancellation is the commission of any of the acts
enumerated in Art. 239(a)[16] of the Labor Code, such as fraud and
misrepresentation in connection with the adoption or ratification of the unions
constitution and like documents. The Court, has in previous cases, said that to
decertify a union, it is not enough to show that the union includes ineligible
employees in its membership. It must also be shown that there was
misrepresentation, false statement, or fraud in connection with the application for
registration and the supporting documents, such as the adoption or ratification of
the constitution and by-laws or amendments thereto and the minutes of ratification
of the constitution or by-laws, among other documents.[17]
Essentially, Ventures faults both the BLR and the CA in finding that there
was no fraud or misrepresentation on the part of the Union sufficient to justify
cancellation of its registration. In this regard, Ventures makes much of, first, the
separate hand-written statements of 82 employees who, in gist, alleged that they
were unwilling or harassed signatories to the attendance sheet of the organizational
meeting.
We are not persuaded. As aptly noted by both the BLR and CA, these
mostly undated written statements submitted by Ventures on March 20, 2001, or
seven months after it filed its petition for cancellation of registration, partake of the
nature of withdrawal of union membership executed after the Unions filing of a
petition for certification election on March 21, 2000. We have in precedent

cases[18] said that the employees withdrawal from a labor union made before the
filing of the petition for certification election is presumed voluntary, while
withdrawal after the filing of such petition is considered to be involuntary and does
not affect the same. Now then, if a withdrawal from union membership done after a
petition for certification election has been filed does not vitiate such petition, is it
not but logical to assume that such withdrawal cannot work to nullify the
registration of the union? Upon this light, the Court is inclined to agree with the
CA that the BLR did not abuse its discretion nor gravely err when it concluded that
the affidavits of retraction of the 82 members had no evidentiary weight.
It cannot be over-emphasized that the registration or the recognition of a
labor union after it has submitted the corresponding papers is not ministerial on the
part of the BLR. Far from it. After a labor organization has filed the necessary
registration documents, it becomes mandatory for the BLR to check if the
requirements under Art. 234[19] of the Labor Code have been sedulously complied
with.[20] If the unions application is infected by falsification and like serious
irregularities, especially those appearing on the face of the application and its
attachments, a union should be denied recognition as a legitimate labor
organization. Prescinding from these considerations, the issuance to the Union of
Certificate of Registration No. RO300-00-02-UR-0003 necessarily implies that its
application for registration and the supporting documents thereof are prima
facie free from any vitiating irregularities.
Second, Ventures draws attention to the inclusion of 82 individuals to the list
of participants in the January 9, 2000 organizational meeting. Ventures submits that
the 82, being no longer connected with the company, should not have been counted
as attendees in the meeting and the ratification proceedings immediately
afterwards.
The assailed inclusion of the said 82 individuals to the meeting and
proceedings adverted to is not really fatal to the Unions cause for, as determined
by the BLR, the allegations of falsification of signatures or misrepresentation with
respect to these individuals are without basis.[21] The Court need not delve into the
question of whether these 82 dismissed individuals were still Union members
qualified to vote and affix their signature on its application for registration and
supporting documents. Suffice it to say that, as aptly observed by the CA, the

procedure for acquiring or losing union membership and the determination of who
are qualified or disqualified to be members are matters internal to the union and
flow from its right to self-organization.
To our mind, the relevancy of the 82 individuals active participation in
the Unions organizational meeting and the signing ceremonies thereafter comes in
only for purposes of determining whether or not the Union, even without the 82,
would still meet what Art. 234(c) of the Labor Code requires to be submitted, to
wit:
Art. 234. Requirements of Registration.Any applicant labor
organization x x x shall acquire legal personality and shall be entitled to
the rights and privileges granted by law to legitimate labor organizations
upon issuance of the certificate of registration based on the following
requirements:
xxxx
(c) The names of all its members comprising at least twenty
percent (20%) of all the employees in the bargaining unit where it seeks
to operate.

The BLR, based on its official records, answered the poser in the
affirmative. Wrote the BLR:
It is imperative to look into the records of respondent union with
this Bureau pursuant to our role as a central registry of union and CBA
records under Article 231 of the Labor Code and Rule XVII of the rules
implementing Book V of the Labor Code, as amended x x x.
In its union records on file with this Bureau, respondent union
submitted the names of [542] members x x x. This number easily
complied with the 20% requirement, be it 1,928 or 2,202 employees in
the establishment. Even subtracting the 82 employees from 542 leaves
460 union members, still within 440 or 20% of the maximum total of
2,202 rank-and-file employees.

Whatever misgivings the petitioner may have with regard to the

82 dismissed employees is better addressed in the inclusion-exclusion
proceedings during a pre-election conference x x x. The issue
surrounding the involvement of the 82 employees is a matter of
membership or voter eligibility. It is not a ground to cancel union
registration. (Emphasis added.)

The bare fact that three signatures twice appeared on the list of those who
participated in the organizational meeting would not, to our mind, provide a valid
reason to cancel Certificate of Registration No. RO300-00-02-UR-0003. As
the Union tenably explained without rebuttal from Ventures, the double entries are
no more than normal human error, effected without malice. Even the labor
arbiter who found for Ventures sided with the Union in its explanation on the
absence of malice.[22]
The cancellation of a unions registration doubtless has an impairing
dimension on the right of labor to self-organization. Accordingly, we can accord
concurrence to the following apt observation of the BLR: [F]or fraud and
misrepresentation [to be grounds for] cancellation of union registration under
Article 239 [of the Labor Code], the nature of the fraud and misrepresentation must
be grave and compelling enough to vitiate the consent of a majority of union
members.[23]

In its Comment, the Union points out that for almost seven (7) years
following the filing of its petition, no certification election has yet been conducted
among the rank-and-file employees. If this be the case, the delay has gone far
enough and can no longer be allowed to continue. The CA is right when it said that
Ventures should not interfere in the certification election by actively and
persistently opposing the certification election of the Union. A certification
election is exclusively the concern of employees and the employer lacks the legal
personality to challenge it.[24] In fact, jurisprudence frowns on the employers
interference in a certification election for such interference unduly creates the
impression that it intends to establish a company union.[25]

Ventures allegations on forum shopping and the procedural lapse

supposedly committed by the BLR in allowing a belatedly filed motion for
reconsideration need not detain us long. Suffice it to state that this Court has
consistently ruled that the application of technical rules of procedure in labor cases
may be relaxed to serve the demands of substantial justice. [26] So it must be in this
case.
WHEREFORE, the petition is DENIED. The Decision and Resolution
dated October 20, 2003 and January 19, 2004, respectively, of the CA
are AFFIRMED. S.S. Ventures Labor Union shall remain in the roster of
legitimate labor organizations, unless it has in the meantime lost its legitimacy for
causes set forth in the Labor Code. Costs against petitioner.

Republic of the Philippines

SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 196276

June 4, 2014

TAKATA (PHILIPPINES) CORPORATION, Petitioner,

vs.
BUREAU OF LABOR RELATIONS and SAMAHANG LAKAS MANGGAGAWA NG TAKATA
(SALAMAT),Respondents.
DECISION
PERALTA, J.:
Before us is a petition for review on certiorari filed by petitioner TAKATA Philippines Corporation
assailing the Decision dated December 22, 2010 and the Resolution dated March 28, 2011 of the
Court of Appeals in CA-G.R. SP No. 112406.
1

On July 7, 2009, petitioner filed with the Department of Labor and Employment (DOLE) Regional
Office a Petition for Cancellation of the Certificate of Union Registration of Respondent Samahang
Lakas Manggagawa ng Takata (SALAMA1) on the ground that the latter is guilty of
misrepresentation, false statement and fraud with respect to the number of those who participated in
the organizational meeting, the adoption and ratification of its Constitution and By-Laws, and in the
election of its officers. It contended that in the May 1, 2009 organizational meeting of respondent,
only 68 attendees signed the attendance sheet, and which number comprised only 17% of the total
number of the 396 regular rank- and-file employees which respondent sought to represent, and
hence, respondent failed to comply with the 20% minimum membership requirement. Petitioner
insisted that the document "Pangalan ng mga Kasapi ng Unyon" bore no signatures of the alleged
119 union members; and that employees were not given sufficient information on the documents
they signed; that the document "Sama-Samang Pahayag ng Pagsapi" was not submitted at the time
of the filing of respondent's application for union registration; that the 119 union members were
actually only 117; and, that the total number of petitioner's employees as of May 1, 2009 was 470,
and not 396 as respondent claimed.
3

Respondent denied the charge and claimed that the 119 union members were more than the 20%
requirement for union registration. The document "Sama-Samang Pahayag ng Pagsapi sa Unyon"
which it presented in its petition for certification election supported their claim of 119 members.
Respondent also contended that petitioner was estopped from assailing its legal personality as it
agreed to a certification election and actively participated in the pre-election conference of the
certification election proceedings. Respondent argued that the union members were informed of the
contents of the documents they signed and that the 68 attendees to the organizational meeting
constituted more than 50% of the total union membership, hence, a quo rumexisted for the conduct
of the said meeting.
5

On August 27, 2009, DOLE Regional Director, Atty. Ricardo S. Martinez, Sr., issued a
Decision granting the petition for cancellation of respondent's certificate of registration, the
dispositive portion of which reads:
8

WHEREFORE, from the foregoing considerations, the petition is hereby GRANTED. Accordingly, the
respondent Union Certificate of Registration No. RO400A-2009-05-01-UR-LAG, dated May 19, 2009
is hereby REVOCKED (sic) and /or CANCELLED pursuant to paragraph (a) & (b), Section 3, Rule
XIV of Department Order No. 40-03 and the Samahang Lakas ng Manggagawa ng TAKATA
(SALAMAT) is hereby delisted from the roll of legitimate labor organization of this office.
9

In revoking respondent's certificate of registration, the Regional Director found that the 68
employees who attended the organizational meeting was obviously less than 20% of the total
number of 396 regular rank-and-file employees which respondent sought to represent, hence, short
of the union registration requirement; that the attendance sheet which contained the signatures and
names of the union members totalling to 68 contradicted the list of names stated in the document
denominated as "Pangalan ng mga Kasaping Unyon." The document "Sama-Samang Pahayag ng
Pagsapi" was not attached to the application for registration as it was only submitted in the petition
for certification election filed by respondent at a later date. The Regional Director also found that the
proceedings in the cancellation of registration and certification elections are two different and entirely
separate and independent proceedings which were not dependent on each other.
Dissatisfied, respondent, through Bukluran ng Manggagawang Pilipino (BMP) Paralegal Officer,
Domingo P. Mole, filed a Notice and Memorandum of Appeal with the Bureau of Labor Relations
(BLR). However, on September 28,2009, respondent, through its counsels, Attys.
10

Napoleon C. Banzuela, Jr. and Jehn Louie W. Velandrez, filed an Appeal Memorandum with Formal
Entry of Appearance to the Office of the DOLE Secretary, which the latter eventually referred to the
BLR. Petitioner filed an Opposition to the Appeals praying for their dismissal on the ground of forum
shopping as respondent filed two separate appeals in two separate venues; and for failing to avail of
the correct remedy within the period; and that the certificate of registration was tainted with fraud,
misrepresentation and falsification.
11

12

In its Answer, respondent claimed that there was no forum shopping as BMP's Paralegal Officer
was no longer authorized to file an appeal on behalf of respondent as the latter's link with BMP was
already terminated and only the Union President was authorized to file the appeal; and that it
complied with Department Order No. 40-03.
13

On December 9, 2009, after considering respondent's Appeal Memorandum with Formal Entry of
Appearance and petitioner's Answer, the BLR rendered its Decision reversing the Order of the
Regional Director, the decretal portion of which reads:
14

WHEREFORE, the appeal is hereby GRANTED. The Decision of Regional Director Ricardo S.
Martinez, Sr., dated 27 August 2009, is hereby REVERSEDand SET ASIDE.
Accordingly, Samahang Lakas Manggagawa ng TAKATA (SALAMAT) shall remain in the roster of
labor organizations.
15

In reversing, the BLR found that petitioner failed to prove that respondent deliberately and
maliciously misrepresented the number of rank-and-file employees. It pointed out petitioner's basis
for the alleged noncompliance with the minimum membership requirement for registration was the
attendance of 68 members to the May 1, 2009 organizational meeting supposedly comprising only
17% of the total 396 regular rank-and-file employees. However, the BLR found that the list of
employees who participated in the organizational meeting was a separate and distinct requirement
from the list of the names of members comprising at least 20% of the employees in the bargaining
unit; and that there was no requirement for signatures opposite the names of the union members;
and there was no evidence showing that the employees assailed their inclusion in the list of union
members.
Petitioner filed a motion for reconsideration, which was denied by the BLR in a Resolution dated
January 8, 2010.
16

Undaunted, petitioner went to the CA via a petition for certiorari under Rule 65.
After the submission of the parties' respective pleadings, the case was submitted for decision.
On December 22, 2010, the CA rendered its assailed decision which denied the petition and affirmed
the decision of the BLR. Petitioner's motion for reconsideration was denied in a Resolution dated
March 29, 2011.
Hence this petition for review filed by petitioner raising the following issues, to wit:
THE HONORABLE COURT OF APPEALS COMMITTED GRAVE AND SERIOUS ERROR IN
AFFIRMING THE DECISION OF PUBLIC RESPONDENT BLR AND NOT FINDING ANY
VIOLATION BY SAMAHANG LAKAS MANGGAGAWA SA TAKATA (SALAMAT) OF THE RULE ON
FORUM SHOPPING IN THE FILING OF TWO VERIFIED APPEALS FOR AND ITS BEHALF. BOTH
OF THE APPEALS SHOULD HAVE BEEN DISMISSED OUTRIGHT BY PUBLIC RESPONDENT
BLR, ON GROUND OF FORUM SHOPPING.
THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN FINDING THAT THE
APPLICATION FOR REGISTRATION OF SAMAHANG LAKAS MANGGAGAWA SA TAKATA
(SALAMAT) WAS COMPLIANT WITH THE LAW. CONSIDERING THE CIRCUMSTANCES
OBTAINING IN THE REGISTRATION OF SALAMAT, IT IS CLEAR THAT THE SAME IS TAINTED
WITH FRAUD, MISREPRESENTATION AND FALSIFICATION. SALAMAT DID NOT POSSESS THE
REQUIREDNUMBER OF MEMBERS AT THE TIME OF FILING OF ITS APPLICATION FOR
REGISTRATION, HENCE, IT SHOULD BE HELD GUILTY OF MISREPRESENTATION, AND FALSE
STATEMENTS AND FRAUD IN CONNECTION THEREWITH.
17

Anent the first issue, petitioner contends that respondent had filed two separate appeals with two
different representations at two different venues, in violation of the rule on multiplicity of suits and
forum shopping, and instead of dismissing both appeals, the appeal erroneously filed before the
Labor Secretary was the one held validly filed, entertained and even granted; that it is not within the
discretion of BLR to choose which between the two appeals should be entertained, as it is the fact of

the filing of the two appeals that is being prohibited and not who among the representatives therein
possessed the authority.
We are not persuaded.
We find no error committed by the CA in finding that respondent committed no forum shopping. As
the CA correctly concluded, to wit:
It is undisputed that BMP Paralegal Officer Domingo P. Mole was no longer authorized to file an
appeal on behalf of union SALAMAT and that BMP was duly informed that its services was already
terminated. SALAMAT even submitted before the BLR its "Resolusyon Blg. 01-2009" terminating the
services of BMP and revoking the representation of Mr. Domingo Mole in any of the pending cases
being handled by him on behalf of the union. So, considering that BMP Paralegal Officer Domingo P.
Mole was no longer authorized to file an appeal when it filed the Notice and Memorandum of Appeal
to DOLE Regional Office No. IV-A, the same can no longer be treated as an appeal filed by union
SALAMAT. Hence, there is no forum shopping to speak of in this case as only the Appeal
Memorandum with Formal Entry of Appearance filed by Atty. Napoleon C. Banzuela, Jr. and Atty.
Jehn Louie W. Velandrez is sanctioned by SALAMAT.
18

Since Mole's appeal filed with the BLR was not specifically authorized by respondent, such appeal is
considered to have not been filed at all. It has been held that "if a complaint is filed for and in behalf
of the plaintiff who is not authorized to do so, the complaint is not deemed filed.
An unauthorized complaint does not produce any legal effect."

19

Respondent through its authorized representative filed its Appeal Memorandum with Formal Entry of
Appearance before the Labor Secretary, and not with the BLR. As the appeal emanated from the
petition for cancellation of certificate of registration filed with the Regional Office, the decision
canceling the registration is appealable to the BLR, and not with the Labor Secretary. However,
since the Labor Secretary motu propio referred the appeal with the BLR, the latter can now act on it.
Considering that Mole's appeal with the BLR was not deemed filed, respondents appeal, through
Banzuela and Associates, which the Labor Secretary referred to the BLR was the only existing
appeal with the BLR for resolution. There is, therefore, no merit to petitioner's claim that BLR chose
the appeal of Banzuela and Associates over Mole's appeal.
The case of Abbott Laboratories Philippines, Inc. v. Abbott Laboratories Employees Union cited by
petitioner is not at all applicable in this case as the issue therein is the authority of the Labor
Secretary to review the decision of the Bureau of Labor Relations rendered in the exercise of its
appellate jurisdiction over decision of the Regional Director in cases involving cancellations of
certificate of registration of labor unions. We found no grave abuse of discretion committed by the
Secretary of Labor in not acting on therein petitioner's appeal. The decision of the Bureau of Labor
Relations on cases brought before it on appeal from the Regional Director are final and executory.
Hence, the remedy of the aggrieved party is to seasonably avail of the special civil action of certiorari
under Rule 65 and the Rules of Court. In this case, after the Labor Secretary motu propio referred
respondent's appeal filed with it to the BLR which rendered its decision reversing the Regional
Director, petitioner went directly to the CA via a petition for certiorari under Rule 65.
20

As to the second issue, petitioner seeks the cancellation of respondent's registration on grounds
offraud and misrepresentation bearing on the minimum requirement of the law as to its membership,
considering the big disparity in numbers, between the organizational meeting and the list of
members, and so misleading the BLR that it obtained the minimum required number of employees
for purposes of organization and registration.
We find no merit in the arguments.
Art. 234 of the Labor Code provides:
ART. 234. Requirements of Registration. - A federation, national union or industry or trade union
center or an independent union shall acquire legal personality and shall be entitled to the rights and
privileges granted by law to legitimate labor organizations upon issuance of the certificate of
registration based on the following requirements:
(a) Fifty pesos (P50.00)registration fee;
(b) The names of its officers, their addresses, the principal address of the labor organization,
the minutes of the organizational meetings and the list of the workers who participated in
such meetings;
(c) In case the applicant is an independent union, the names of all its members comprising at
least twenty percent (20%) of all the employees in the bargaining unit where it seeks to
operate;
(d) If the applicant union has been in existence for one or more years, copies of its annual
financial reports; and
(e) Four copies of the constitution and by-laws of the applicant union, minutes of its adoption
or ratification, and the list of the members who participated in it."
And after the issuance of the certificate of registration, the labor organization's registration could be
assailed directly through cancellation of registration proceedings in accordance with Articles 238 and
239 of the Labor Code. And the cancellation of union certificate of registration and the grounds
thereof are as follows:
ART. 238. Cancellation of Registration. - The certificate of registration of any legitimate labor
organization, whether national or local, may be cancelled by the Bureau, after due hearing, only on
the grounds specified in Article 239 hereof.
ART. 239. Grounds for Cancellation of Union Registration. - The following may constitute grounds for
cancellation of union registration:
(a) Misrepresentation, false statement or fraud in connection with the adoption or ratification
of the constitution and by-laws or amendments thereto, the minutes of ratification, and the
list of members who took part in the ratification;

(b) Misrepresentation, false statements or fraud in connection with the election of officers,
minutes of the election of officers, and the list of voters;
(c) Voluntary dissolution by the members.
Petitioner's charge that respondent committed misrepresentation and fraud in securing its certificate
of registration is a serious charge and must be carefully evaluated. Allegations thereof should be
compounded with supporting circumstances and evidence. We find no evidence on record to
support petitioner's accusation.
21

Petitioner's allegation of misrepresentation and fraud is based on its claim that during the
organizational meeting on May 1, 2009, only 68 employees attended, while respondent claimed that
it has 119 members as shown in the document denominated as "Pangalan ng mga Kasapi ng
Unyon;" hence, respondent misrepresented on the 20% requirement of the law as to its membership.
We do not agree.
It does not appear in Article 234 (b) of the Labor Code that the attendees in the organizational
meeting must comprise 20% of the employees in the bargaining unit. In fact, even the Implementing
Rules and Regulations of the Labor Code does not so provide. It is only under Article 234 (c) that
requires the names of all its members comprising at least twenty percent (20%) of all the employees
in the bargaining unit where it seeks to operate. Clearly, the 20% minimum requirement pertains to
the employees membership in the union and not to the list of workers who participated in the
organizational meeting. Indeed, Article 234 (b) and (c) provide for separate requirements, which
must be submitted for the union's registration, and which respondent did submit. Here, the total
number of employees in the bargaining unit was 396, and 20% of which was about 79. Respondent
submitted a document entitled "Pangalan ng Mga Kasapi ng Unyon" showing the names of 119
employees as union members, thus respondent sufficiently complied even beyond the 20%
minimum membership requirement. Respondent also submitted the attendance sheet of the
organizational meeting which contained the names and signatures of the 68 union members who
attended the meeting. Considering that there are 119 union members which are more than 20% of
all the employees of the bargaining unit, and since the law does not provide for the required number
of members to attend the organizational meeting, the 68 attendees which comprised at least the
majority of the 119 union members would already constitute a quorum for the meeting to proceed
and to validly ratify the Constitution and By-laws of the union. There is, therefore, no basis for
petitioner to contend that grounds exist for the cancellation of respondent's union registration. For
fraud and misrepresentation to be grounds for cancellation of union registration under Article 239 of
the Labor Code, the nature of the fraud and misrepresentation must be grave and compelling
enough to vitiate the consent of a majority of union members.
22

Petitioner's claim that the alleged union members signed documents without adequate information is
not persuasive. The one who alleges a fact has the burden of proving it and a mere allegation is not
evidence. In fact, we note that not one of those listed in the document denominated as "Pangalan
ng Mga Kasaping Unyon" had come forward to deny their membership with respondent. Notably, it
had not been rebutted that the same union members had signed the document entitled "Sama23

Samang Pahayag ng Pagsapi," thus, strengtheningtheir desire to be members of the respondent

union.
Petitioner claims that in the list of members, there was an employee whose name appeared twice
and another employee who was merely a project employee. Such could not be considered a
misrepresentation in the absence of showing that respondent deliberately did so for the purpose of
increasing their union membership. In fact, even if those two names were not included in the list of
union members, there would still be 117 members which was still more than 20% of the 396 rankand-file employees.
As to petitioner's argument that the total number of its employees as of May 1, 2009 was 470, and
not396 as respondent claimed, still the 117 union members comprised more than the 20%
membership requirement for respondent's registration.
In Mariwasa Siam Ceramics v. Secretary of the Department of Labor and Employment, we said:
24

For the purpose of de-certifying a union such as respondent, it must be shown that there was
misrepresentation, false statement or fraud in connection with the adoption or ratification of the
constitution and by-laws or amendments thereto, the minutes of ratification; or, in connection with the
election of officers, the minutes of the election of officers, the list of voters, or failure to submit these
documents together with the list of the newly elected-appointed officers and their postal addresses to
the BLR.
The bare fact that two signatures appeared twice on the list of those who participated in the
organizational meeting would not, to our mind, provide a valid reason to cancel respondents
certificate of registration. The cancellation of a unions registration doubtless has an impairing
dimension on the right of labor to self-organization. For fraud and misrepresentation to be grounds
for cancellation of union registration under the Labor Code, the nature of the fraud and
misrepresentation must be grave and compelling enough to vitiate the consent of a majority of union
members.
1wphi1

In this case, we agree with the BLR and the CA that respondent could not have possibly committed
misrepresentation, fraud, or false statements. The alleged failure of respondent to indicate with
mathematical precision the total number of employees in the bargaining unit is of no moment,
especially as it was able to comply with the 20% minimum membership requirement. Even if the total
number of rank-and-file employees of petitioner is 528, while respondent declared that it should only
be 455, it still cannot be denied that the latter would have more than complied with the registration
requirement.
25

WHEREFORE, premises considered, the petition for review is DENIED. The Decision dated
December 22, 2010 and the Resolution dated March 28, 2011 of the Court of Appeals, in CA-G.R.
SP No. 112406, are AFFIRMED.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 169717

March 16, 2011

SAMAHANG MANGGAGAWA SA CHARTER CHEMICAL SOLIDARITY OF UNIONS IN THE

PHILIPPINES FOR EMPOWERMENT AND REFORMS (SMCC-SUPER), ZACARRIAS JERRY
VICTORIO-Union President,Petitioner,
vs.
CHARTER CHEMICAL and COATING CORPORATION, Respondent.
DECISION
DEL CASTILLO, J.:

The right to file a petition for certification election is accorded to a labor organization provided that it
complies with the requirements of law for proper registration. The inclusion of supervisory
employees in a labor organization seeking to represent the bargaining unit of rank-and-file
employees does not divest it of its status as a legitimate labor organization. We apply these
principles to this case.
This Petition for Review on Certiorari seeks to reverse and set aside the Court of Appeals March 15,
2005 Decision1 in CA-G.R. SP No. 58203, which annulled and set aside the January 13, 2000
Decision2 of the Department of Labor and Employment (DOLE) in OS-A-6-53-99 (NCR-OD-M-9902019) and the September 16, 2005 Resolution3 denying petitioner unions motion for reconsideration.
Factual Antecedents
On February 19, 1999, Samahang Manggagawa sa Charter Chemical Solidarity of Unions in the
Philippines for Empowerment and Reforms (petitioner union) filed a petition for certification election
among the regular rank-and-file employees of Charter Chemical and Coating Corporation
(respondent company) with the Mediation Arbitration Unit of the DOLE, National Capital Region.
On April 14, 1999, respondent company filed an Answer with Motion to Dismiss 4 on the ground that
petitioner union is not a legitimate labor organization because of (1) failure to comply with the
documentation requirements set by law, and (2) the inclusion of supervisory employees within
petitioner union.5
Med-Arbiters Ruling
On April 30, 1999, Med-Arbiter Tomas F. Falconitin issued a Decision6 dismissing the petition for
certification election. The Med-Arbiter ruled that petitioner union is not a legitimate labor organization
because the Charter Certificate, "Sama-samang Pahayag ng Pagsapi at Authorization," and
"Listahan ng mga Dumalo sa Pangkalahatang Pulong at mga Sumang-ayon at Nagratipika sa
Saligang Batas" were not executed under oath and certified by the union secretary and attested to
by the union president as required by Section 235 of the Labor Code 7 in relation to Section 1, Rule
VI of Department Order (D.O.) No. 9, series of 1997. The union registration was, thus, fatally
defective.
The Med-Arbiter further held that the list of membership of petitioner union consisted of 12
batchman, mill operator and leadman who performed supervisory functions. Under Article 245 of the
Labor Code, said supervisory employees are prohibited from joining petitioner union which seeks to
represent the rank-and-file employees of respondent company.
As a result, not being a legitimate labor organization, petitioner union has no right to file a petition for
certification election for the purpose of collective bargaining.
Department of Labor and Employments Ruling
On July 16, 1999, the DOLE initially issued a Decision8 in favor of respondent company dismissing
petitioner unions appeal on the ground that the latters petition for certification election was filed out

of time. Although the DOLE ruled, contrary to the findings of the Med-Arbiter, that the charter
certificate need not be verified and that there was no independent evidence presented to establish
respondent companys claim that some members of petitioner union were holding supervisory
positions, the DOLE sustained the dismissal of the petition for certification after it took judicial notice
that another union, i.e., Pinag-isang Lakas Manggagawa sa Charter Chemical and Coating
Corporation, previously filed a petition for certification election on January 16, 1998. The Decision
granting the said petition became final and executory on September 16, 1998 and was remanded for
immediate implementation. Under Section 7, Rule XI of D.O. No. 9, series of 1997, a motion for
intervention involving a certification election in an unorganized establishment should be filed prior to
the finality of the decision calling for a certification election. Considering that petitioner union filed its
petition only on February 14, 1999, the same was filed out of time.
On motion for reconsideration, however, the DOLE reversed its earlier ruling. In its January 13, 2000
Decision, the DOLE found that a review of the records indicates that no certification election was
previously conducted in respondent company. On the contrary, the prior certification election filed by
Pinag-isang Lakas Manggagawa sa Charter Chemical and Coating Corporation was, likewise,
denied by the Med-Arbiter and, on appeal, was dismissed by the DOLE for being filed out of time.
Hence, there was no obstacle to the grant of petitioner unions petition for certification election, viz:
WHEREFORE, the motion for reconsideration is hereby GRANTED and the decision of this Office
dated 16 July 1999 is MODIFIED to allow the certification election among the regular rank-and-file
employees of Charter Chemical and Coating Corporation with the following choices:
1. Samahang Manggagawa sa Charter Chemical-Solidarity of Unions in the Philippines for
Empowerment and Reform (SMCC-SUPER); and
2. No Union.
Let the records of this case be remanded to the Regional Office of origin for the immediate conduct
of a certification election, subject to the usual pre-election conference.
SO DECIDED.9
Court of Appeals Ruling
On March 15, 2005, the CA promulgated the assailed Decision, viz:
WHEREFORE, the petition is hereby GRANTED. The assailed Decision and Resolution dated
January 13, 2000 and February 17, 2000 are hereby [ANNULLED] and SET ASIDE.
SO ORDERED.10
In nullifying the decision of the DOLE, the appellate court gave credence to the findings of the MedArbiter that petitioner union failed to comply with the documentation requirements under the Labor
Code. It, likewise, upheld the Med-Arbiters finding that petitioner union consisted of both rank-andfile and supervisory employees. Moreover, the CA held that the issues as to the legitimacy of

petitioner union may be attacked collaterally in a petition for certification election and the infirmity in
the membership of petitioner union cannot be remedied through the exclusion-inclusion proceedings
in a pre-election conference pursuant to the ruling in Toyota Motor Philippines v. Toyota Motor
Philippines Corporation Labor Union.11 Thus, considering that petitioner union is not a legitimate
labor organization, it has no legal right to file a petition for certification election.
Issues
I
Whether x x x the Honorable Court of Appeals committed grave abuse of discretion tantamount to
lack of jurisdiction in granting the respondent [companys] petition for certiorari (CA G.R. No. SP No.
58203) in spite of the fact that the issues subject of the respondent company[s] petition was already
settled with finality and barred from being re-litigated.
II
Whether x x x the Honorable Court of Appeals committed grave abuse of discretion tantamount to
lack of jurisdiction in holding that the alleged mixture of rank-and-file and supervisory employee[s] of
petitioner [unions] membership is [a] ground for the cancellation of petitioner [unions] legal
personality and dismissal of [the] petition for certification election.
III
Whether x x x the Honorable Court of Appeals committed grave abuse of discretion tantamount to
lack of jurisdiction in holding that the alleged failure to certify under oath the local charter certificate
issued by its mother federation and list of the union membership attending the organizational
meeting [is a ground] for the cancellation of petitioner [unions] legal personality as a labor
organization and for the dismissal of the petition for certification election. 12
Petitioner Unions Arguments
Petitioner union claims that the litigation of the issue as to its legal personality to file the subject
petition for certification election is barred by the July 16, 1999 Decision of the DOLE. In this decision,
the DOLE ruled that petitioner union complied with all the documentation requirements and that
there was no independent evidence presented to prove an illegal mixture of supervisory and rankand-file employees in petitioner union. After the promulgation of this Decision, respondent company
did not move for reconsideration, thus, this issue must be deemed settled.
Petitioner union further argues that the lack of verification of its charter certificate and the alleged
illegal composition of its membership are not grounds for the dismissal of a petition for certification
election under Section 11, Rule XI of D.O. No. 9, series of 1997, as amended, nor are they grounds
for the cancellation of a unions registration under Section 3, Rule VIII of said issuance. It contends
that what is required to be certified under oath by the local unions secretary or treasurer and
attested to by the local unions president are limited to the unions constitution and by-laws,
statement of the set of officers, and the books of accounts.

Finally, the legal personality of petitioner union cannot be collaterally attacked but may be
questioned only in an independent petition for cancellation pursuant to Section 5, Rule V, Book IV of
the Rules to Implement the Labor Code and the doctrine enunciated in Tagaytay Highlands
International Golf Club Incoprorated v. Tagaytay Highlands Empoyees Union-PTGWO.13
Respondent Companys Arguments
Respondent company asserts that it cannot be precluded from challenging the July 16, 1999
Decision of the DOLE. The said decision did not attain finality because the DOLE subsequently
reversed its earlier ruling and, from this decision, respondent company timely filed its motion for
reconsideration.
On the issue of lack of verification of the charter certificate, respondent company notes that Article
235 of the Labor Code and Section 1, Rule VI of the Implementing Rules of Book V, as amended by
D.O. No. 9, series of 1997, expressly requires that the charter certificate be certified under oath.
It also contends that petitioner union is not a legitimate labor organization because its composition is
a mixture of supervisory and rank-and-file employees in violation of Article 245 of the Labor Code.
Respondent company maintains that the ruling in Toyota Motor Philippines vs. Toyota Motor
Philippines Labor Union14 continues to be good case law. Thus, the illegal composition of petitioner
union nullifies its legal personality to file the subject petition for certification election and its legal
personality may be collaterally attacked in the proceedings for a petition for certification election as
was done here.
Our Ruling
The petition is meritorious.
The issue as to the legal personality of petitioner union is not barred by the July 16, 1999 Decision
of the DOLE.
A review of the records indicates that the issue as to petitioner unions legal personality has been
timely and consistently raised by respondent company before the Med-Arbiter, DOLE, CA and now
this Court. In its July 16, 1999 Decision, the DOLE found that petitioner union complied with the
documentation requirements of the Labor Code and that the evidence was insufficient to establish
that there was an illegal mixture of supervisory and rank-and-file employees in its membership.
Nonetheless, the petition for certification election was dismissed on the ground that another union
had previously filed a petition for certification election seeking to represent the same bargaining unit
in respondent company.
Upon motion for reconsideration by petitioner union on January 13, 2000, the DOLE reversed its
previous ruling. It upheld the right of petitioner union to file the subject petition for certification
election because its previous decision was based on a mistaken appreciation of facts. 15 From this
adverse decision, respondent company timely moved for reconsideration by reiterating its previous
arguments before the Med-Arbiter that petitioner union has no legal personality to file the subject
petition for certification election.

The July 16, 1999 Decision of the DOLE, therefore, never attained finality because the parties timely
moved for reconsideration. The issue then as to the legal personality of petitioner union to file the
certification election was properly raised before the DOLE, the appellate court and now this Court.
The charter certificate need not be certified under oath by the local unions secretary or treasurer
and attested to by its president.
Preliminarily, we must note that Congress enacted Republic Act (R.A.) No. 9481 16 which took effect
on June 14, 2007.17 This law introduced substantial amendments to the Labor Code. However, since
the operative facts in this case occurred in 1999, we shall decide the issues under the pertinent legal
provisions then in force (i.e., R.A. No. 6715,18 amending Book V of the Labor Code, and the rules
and regulations19 implementing R.A. No. 6715, as amended by D.O. No. 9,20
series of 1997) pursuant to our ruling in Republic v. Kawashima Textile Mfg., Philippines, Inc.21
In the main, the CA ruled that petitioner union failed to comply with the requisite documents for
registration under Article 235 of the Labor Code and its implementing rules. It agreed with the MedArbiter that the Charter Certificate, Sama-samang Pahayag ng Pagsapi at Authorization, and
Listahan ng mga Dumalo sa Pangkalahatang Pulong at mga Sumang-ayon at Nagratipika sa
Saligang Batas were not executed under oath. Thus, petitioner union cannot be accorded the status
of a legitimate labor organization.
We disagree.
The then prevailing Section 1, Rule VI of the Implementing Rules of Book V, as amended by D.O.
No. 9, series of 1997, provides:
Section 1. Chartering and creation of a local chapter A duly registered federation or national union
may directly create a local/chapter by submitting to the Regional Office or to the Bureau two (2)
copies of the following:
(a) A charter certificate issued by the federation or national union indicating the creation or
establishment of the local/chapter;
(b) The names of the local/chapters officers, their addresses, and the principal office of the
local/chapter; and
(c) The local/chapters constitution and by-laws provided that where the local/chapters
constitution and by-laws [are] the same as [those] of the federation or national union, this
fact shall be indicated accordingly.
All the foregoing supporting requirements shall be certified under oath by the Secretary or the
Treasurer of the local/chapter and attested to by its President.
As readily seen, the Sama-samang Pahayag ng Pagsapi at Authorization and Listahan ng mga
Dumalo sa Pangkalahatang Pulong at mga Sumang-ayon at Nagratipika sa Saligang Batas are not

among the documents that need to be submitted to the Regional Office or Bureau of Labor Relations
in order to register a labor organization. As to the charter certificate, the above-quoted rule indicates
that it should be executed under oath. Petitioner union concedes and the records confirm that its
charter certificate was not executed under oath. However, in San Miguel Corporation (Mandaue
Packaging Products Plants) v. Mandaue Packing Products Plants-San Miguel Corporation Monthlies
Rank-and-File Union-FFW (MPPP-SMPP-SMAMRFU-FFW),22 which was decided under the
auspices of D.O. No. 9, Series of 1997, we ruled
In San Miguel Foods-Cebu B-Meg Feed Plant v. Hon. Laguesma, 331 Phil. 356 (1996), the Court
ruled that it wasnot necessary for the charter certificate to be certified and attested by the
local/chapter officers. Id. While this ruling was based on the interpretation of the previous
Implementing Rules provisions which were supplanted by the 1997 amendments, we believe
that the same doctrine obtains in this case. Considering that the charter certificate is prepared
and issued by the national union and not the local/chapter, it does not make sense to have the
local/chapters officers x x x certify or attest to a document which they had no hand in the
preparation of.23 (Emphasis supplied)
In accordance with this ruling, petitioner unions charter certificate need not be executed under oath.
Consequently, it validly acquired the status of a legitimate labor organization upon submission of (1)
its charter certificate,24 (2) the names of its officers, their addresses, and its principal office, 25 and (3)
its constitution and by-laws26 the last two requirements having been executed under oath by the
proper union officials as borne out by the records.
The mixture of rank-and-file and supervisory employees in petitioner union does not nullify its legal
personality as a legitimate labor organization.
The CA found that petitioner union has for its membership both rank-and-file and supervisory
employees. However, petitioner union sought to represent the bargaining unit consisting of rank-andfile employees. Under Article 24527 of the Labor Code, supervisory employees are not eligible for
membership in a labor organization of rank-and-file employees. Thus, the appellate court ruled that
petitioner union cannot be considered a legitimate labor organization pursuant to Toyota Motor
Philippines v. Toyota Motor Philippines Corporation Labor Union28(hereinafter Toyota).
Preliminarily, we note that petitioner union questions the factual findings of the Med-Arbiter, as
upheld by the appellate court, that 12 of its members, consisting of batchman, mill operator and
leadman, are supervisory employees. However, petitioner union failed to present any rebuttal
evidence in the proceedings below after respondent company submitted in evidence the job
descriptions29 of the aforesaid employees. The job descriptions indicate that the aforesaid employees
exercise recommendatory managerial actions which are not merely routinary but require the use of
independent judgment, hence, falling within the definition of supervisory employees under Article
212(m)30 of the Labor Code. For this reason, we are constrained to agree with the Med-Arbiter, as
upheld by the appellate court, that petitioner union consisted of both rank-and-file and supervisory
employees.
Nonetheless, the inclusion of the aforesaid supervisory employees in petitioner union does not divest
it of its status as a legitimate labor organization. The appellate courts reliance on Toyota is

misplaced in view of this Courts subsequent ruling in Republic v. Kawashima Textile Mfg.,
Philippines, Inc.31 (hereinafter Kawashima). InKawashima, we explained at length how and why
the Toyota doctrine no longer holds sway under the altered state of the law and rules applicable to
this case, viz:
R.A. No. 6715 omitted specifying the exact effect any violation of the prohibition [on the comingling of supervisory and rank-and-file employees] would bring about on the legitimacy of
a labor organization.
It was the Rules and Regulations Implementing R.A. No. 6715 (1989 Amended Omnibus Rules)
which supplied the deficiency by introducing the following amendment to Rule II (Registration of
Unions):
"Sec. 1. Who may join unions. - x x x Supervisory employees and security guards shall not be
eligible for membership in a labor organization of the rank-and-file employees but may join,
assist or form separate labor organizations of their own; Provided, that those supervisory
employees who are included in an existing rank-and-file bargaining unit, upon the effectivity of
Republic Act No. 6715, shall remain in that unit x x x. (Emphasis supplied) and Rule V
(Representation Cases and Internal-Union Conflicts) of the Omnibus Rules, viz:
"Sec. 1. Where to file. - A petition for certification election may be filed with the Regional Office which
has jurisdiction over the principal office of the employer. The petition shall be in writing and under
oath.
Sec. 2. Who may file. - Any legitimate labor organization or the employer, when requested to bargain
collectively, may file the petition.
The petition, when filed by a legitimate labor organization, shall contain, among others:
xxxx
(c) description of the bargaining unit which shall be the employer unit unless circumstances
otherwise require; and provided further, that the appropriate bargaining unit of the rank-andfile employees shall not include supervisory employees and/or security guards. (Emphasis
supplied)
By that provision, any questioned mingling will prevent an otherwise legitimate and duly registered
labor organization from exercising its right to file a petition for certification election.
Thus, when the issue of the effect of mingling was brought to the fore in Toyota, the Court, citing
Article 245 of the Labor Code, as amended by R.A. No. 6715, held:
"Clearly, based on this provision, a labor organization composed of both rank-and-file and
supervisory employees is no labor organization at all. It cannot, for any guise or purpose, be a
legitimate labor organization. Not being one, an organization which carries a mixture of rankand-file and supervisory employees cannot possess any of the rights of a legitimate labor

organization, including the right to file a petition for certification election for the purpose of
collective bargaining. It becomes necessary, therefore, anterior to the granting of an order
allowing a certification election, to inquire into the composition of any labor organization
whenever the status of the labor organization is challenged on the basis of Article 245 of the
Labor Code.
xxxx
In the case at bar, as respondent union's membership list contains the names of at least twentyseven (27) supervisory employees in Level Five positions, the union could not, prior to purging itself
of its supervisory employee members, attain the status of a legitimate labor organization. Not being
one, it cannot possess the requisite personality to file a petition for certification election." (Emphasis
supplied)
In Dunlop, in which the labor organization that filed a petition for certification election was one for
supervisory employees, but in which the membership included rank-and-file employees, the Court
reiterated that such labor organization had no legal right to file a certification election to represent a
bargaining unit composed of supervisors for as long as it counted rank-and-file employees among its
members.
It should be emphasized that the petitions for certification election involved
in Toyota and Dunlop were filed on November 26, 1992 and September 15, 1995, respectively;
hence, the 1989 Rules was applied in both cases.
But then, on June 21, 1997, the 1989 Amended Omnibus Rules was further amended by
Department Order No. 9, series of 1997 (1997 Amended Omnibus Rules). Specifically, the
requirement under Sec. 2(c) of the 1989 Amended Omnibus Rules that the petition for certification
election indicate that the bargaining unit of rank-and-file employees has not been mingled with
supervisory employees was removed. Instead, what the 1997 Amended Omnibus Rules requires is
a plain description of the bargaining unit, thus:
Rule XI
Certification Elections
xxxx
Sec. 4. Forms and contents of petition. - The petition shall be in writing and under oath and shall
contain, among others, the following: x x x (c) The description of the bargaining unit.
In Pagpalain Haulers, Inc. v. Trajano, the Court had occasion to uphold the validity of the 1997
Amended Omnibus Rules, although the specific provision involved therein was only Sec. 1, Rule VI,
to wit:
"Section. 1. Chartering and creation of a local/chapter.- A duly registered federation or national union
may directly create a local/chapter by submitting to the Regional Office or to the Bureau two (2)
copies of the following: a) a charter certificate issued by the federation or national union indicating

the creation or establishment of the local/chapter; (b) the names of the local/chapter's officers, their
addresses, and the principal office of the local/chapter; and (c) the local/ chapter's constitution and
by-laws; provided that where the local/chapter's constitution and by-laws is the same as that of the
federation or national union, this fact shall be indicated accordingly.
All the foregoing supporting requirements shall be certified under oath by the Secretary or the
Treasurer of the local/chapter and attested to by its President."
which does not require that, for its creation and registration, a local or chapter submit a list of its
members.
Then came Tagaytay Highlands Int'l. Golf Club, Inc. v. Tagaytay Highlands Employees UnionPGTWO in which the core issue was whether mingling affects the legitimacy of a labor organization
and its right to file a petition for certification election. This time, given the altered legal milieu, the
Court abandoned the view in Toyota and Dunlopand reverted to its pronouncement in Lopez that
while there is a prohibition against the mingling of supervisory and rank-and-file employees in one
labor organization, the Labor Code does not provide for the effects thereof. Thus, the Court held that
after a labor organization has been registered, it may exercise all the rights and privileges of a
legitimate labor organization. Any mingling between supervisory and rank-and-file employees in its
membership cannot affect its legitimacy for that is not among the grounds for cancellation of its
registration, unless such mingling was brought about by misrepresentation, false statement or fraud
under Article 239 of the Labor Code.
In San Miguel Corp. (Mandaue Packaging Products Plants) v. Mandaue Packing Products PlantsSan Miguel Packaging Products-San Miguel Corp. Monthlies Rank-and-File Union-FFW, the Court
explained that since the 1997 Amended Omnibus Rules does not require a local or chapter to
provide a list of its members, it would be improper for the DOLE to deny recognition to said local or
chapter on account of any question pertaining to its individual members.
More to the point is Air Philippines Corporation v. Bureau of Labor Relations, which involved a
petition for cancellation of union registration filed by the employer in 1999 against a rank-and-file
labor organization on the ground of mixed membership: the Court therein reiterated its ruling
in Tagaytay Highlands that the inclusion in a union of disqualified employees is not among the
grounds for cancellation, unless such inclusion is due to misrepresentation, false statement or fraud
under the circumstances enumerated in Sections (a) and (c) of Article 239 of the Labor Code.
All said, while the latest issuance is R.A. No. 9481, the 1997 Amended Omnibus Rules, as
interpreted by the Court in Tagaytay Highlands, San Miguel and Air Philippines, had already set the
tone for it. Toyota and Dunlopno longer hold sway in the present altered state of the law and the
rules.32 [Underline supplied]
The applicable law and rules in the instant case are the same as those in Kawashima because the
present petition for certification election was filed in 1999 when D.O. No. 9, series of 1997, was still
in effect. Hence,Kawashima applies with equal force here. As a result, petitioner union was not
divested of its status as a legitimate labor organization even if some of its members were
supervisory employees; it had the right to file the subject petition for certification election.

The legal personality of petitioner union cannot be collaterally attacked by respondent company in
the certification election proceedings.
Petitioner union correctly argues that its legal personality cannot be collaterally attacked in the
certification election proceedings. As we explained in Kawashima:
Except when it is requested to bargain collectively, an employer is a mere bystander to any petition
for certification election; such proceeding is non-adversarial and merely investigative, for the
purpose thereof is to determine which organization will represent the employees in their collective
bargaining with the employer. The choice of their representative is the exclusive concern of the
employees; the employer cannot have any partisan interest therein; it cannot interfere with, much
less oppose, the process by filing a motion to dismiss or an appeal from it; not even a mere
allegation that some employees participating in a petition for certification election are actually
managerial employees will lend an employer legal personality to block the certification election. The
employer's only right in the proceeding is to be notified or informed thereof.
The amendments to the Labor Code and its implementing rules have buttressed that policy even
more.33
WHEREFORE, the petition is GRANTED. The March 15, 2005 Decision and September 16, 2005
Resolution of the Court of Appeals in CA-G.R. SP No. 58203 are REVERSED and SET ASIDE. The
January 13, 2000 Decision of the Department of Labor and Employment in OS-A-6-53-99 (NCR-ODM-9902-019) is REINSTATED.
No pronouncement as to costs.SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. 179146

July 23, 2013

HOLY CHILD CATHOLIC SCHOOL, Petitioner,

vs.
HON. PATRICIA STO. TOMAS, in her official capacity as Secretary of the Department of Labor
and Employment, and PINAG-ISANG TINIG AT LAKAS NG ANAKPAWIS HOLY CHILD
CATHOLIC SCHOOL TEACHERS AND EMPLOYEES LABOR UNION (HCCS-TELUPIGLAS), Respondents.
DECISION
PERALTA, J.:

Assailed in this petition for review on certiorari under Rule 45 of the Rules of Civil Procedure are the
April 18, 2007 Decision1 and July 31, 2007 Resolution2 of the Court of Appeals in CA-G.R. SP No.
76175, which affirmed the December 27, 2002 Decision 3 and February 13, 2003 Resolution4 of the
Secretary of the Department of Labor and Employment (SOLE) that set aside the August 10, 2002
Decision5 of the Med-Arbiter denying private respondents petition for certification election.
The factual antecedents are as follows:
On May 31, 2002, a petition for certification election was filed by private respondent Pinag-Isang
Tinig at Lakas ng Anakpawis Holy Child Catholic School Teachers and Employees Labor Union
(HCCS-TELUPIGLAS), alleging that: PIGLAS is a legitimate labor organization duly registered with
the Department of Labor and Employment (DOLE) representing HCCS-TELU-PIGLAS; HCCS is a
private educational institution duly registered and operating under Philippine laws; there are
approximately one hundred twenty (120) teachers and employees comprising the proposed
appropriate bargaining unit; and HCCS is unorganized, there is no collective bargaining agreement
or a duly certified bargaining agent or a labor organization certified as the sole and exclusive
bargaining agent of the proposed bargaining unit within one year prior to the filing of the
petition.6 Among the documents attached to the petition were the certificate of affiliation with PinagIsang Tinig at Lakas ng Anakpawis Kristiyanong Alyansa ng Makabayang Obrero (PIGLAS-KAMAO)
issued by the Bureau of Labor Relations (BLR), charter certificate issued by PIGLASKAMAO, and
certificate of registration of HCCS-TELU as a legitimate labor organization issued by the DOLE. 7
In its Comment8 and Position Paper,9 petitioner HCCS consistently noted that it is a parochial school
with a total of 156 employees as of June 28, 2002, broken down as follows: ninety-eight (98)
teaching personnel, twenty-five (25) non-teaching academic employees, and thirty-three (33) nonteaching non-academic workers. It averred that of the employees who signed to support the petition,
fourteen (14) already resigned and six (6) signed twice. Petitioner raised that members of private
respondent do not belong to the same class; it is not only a mixture of managerial, supervisory, and
rank-and-file employees as three (3) are vice-principals, one (1) is a department head/supervisor,
and eleven (11) are coordinators but also a combination of teaching and non-teaching personnel
as twenty-seven (27) are non-teaching personnel. It insisted that, for not being in accord with Article
24510 of the Labor Code, private respondent is an illegitimate labor organization lacking in personality
to file a petition for certification election, as held in Toyota Motor Philippines Corporation v. Toyota
Motor Philippines Corporation Labor Union;11 and an inappropriate bargaining unit for want of
community or mutuality of interest, as ruled in Dunlop Slazenger (Phils.), Inc. v. Secretary of Labor
and Employment12 and De La Salle University Medical Center and College of Medicine v.
Laguesma.13
Private respondent, however, countered that petitioner failed to substantiate its claim that some of
the employees included in the petition for certification election holds managerial and supervisory
positions.14 Assuming it to be true, it argued that Section 11 (II),15 Rule XI of DOLE Department Order
(D.O.) No. 9, Series of 1997, provided for specific instances in which a petition filed by a legitimate
organization shall be dismissed by the Med-Arbiter and that "mixture of employees" is not one of
those enumerated. Private respondent pointed out that questions pertaining to qualifications of
employees may be threshed out in the inclusion-exclusion proceedings prior to the conduct of the
certification election, pursuant to Section 2,16 Rule XII of D.O. No. 9. Lastly, similar to the ruling in In

Re: Globe Machine and Stamping Company,17 it contended that the will of petitioners employees
should be respected as they had manifested their desire to be represented by only one bargaining
unit. To back up the formation of a single employer unit, private respondent asserted that even if the
teachers may receive additional pay for an advisory class and for holding additional loads,
petitioners academic and non-academic personnel have similar working conditions. It cited Laguna
College v. Court of Industrial Relations,18 as well as the case of a union in West Negros College in
Bacolod City, which allegedly represented both academic and non-academic employees.
On August 10, 2002, Med-Arbiter Agatha Ann L. Daquigan denied the petition for certification
election on the ground that the unit which private respondent sought to represent is inappropriate.
She resolved:
A certification election proceeding directly involves two (2) issues namely: (a) the proper composition
and constituency of the bargaining unit; and (b) the validity of majority representation claims. It is
therefore incumbent upon the Med-Arbiter to rule on the appropriateness of the bargaining unit once
its composition and constituency is questioned.
Section 1 (q), Rule I, Book V of the Omnibus Rules defines a "bargaining unit" as a group of
employees sharing mutual interests within a given employer unit comprised of all or less than all of
the entire body of employees in the employer unit or any specific occupational or geographical
grouping within such employer unit. This definition has provided the "community or mutuality of
interest" test as the standard in determining the constituency of a collective bargaining unit. This is
so because 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. The application of this test may either result in the formation of an employer unit or
in the fragmentation of an employer unit.
In the case at bar, the employees of petitioner, may, as already suggested, quite easily be
categorized into (2) general classes: one, the teaching staff; and two, the non-teaching-staff. Not
much reflection is needed to perceive that the community or mutuality of interest is wanting between
the teaching and the non-teaching staff. It would seem obvious that the teaching staff would find very
little in common with the non-teaching staff as regards responsibilities and function, working
conditions, compensation rates, social life and interests, skills and intellectual pursuits, etc. These
are plain and patent realities which cannot be ignored. These dictate the separation of these two
categories of employees for purposes of collective bargaining. (University of the Philippines vs.
Ferrer-Calleja, 211 SCRA 451)19
Private respondent appealed before the SOLE, who, on December 27, 2002, ruled against the
dismissal of the petition and directed the conduct of two separate certification elections for the
teaching and the non-teaching personnel, thus:
We agree with the Med-Arbiter that there are differences in the nature of work, hours and conditions
of work and salary determination between the teaching and non-teaching personnel of petitioner.
These differences were pointed out by petitioner in its position paper. We do not, however, agree
with the Med-Arbiter that these differences are substantial enough to warrant the dismissal of the
petition. First, as pointed out by private respondent, "inappropriateness of the bargaining unit sought

to be represented is not a ground for the dismissal of the petition." In fact, in the cited case of
University of the Philippines v. Ferrer-Calleja, supra, the Supreme Court did not order the dismissal
of the petition but ordered the conduct of a certification election, limiting the same among the nonacademic personnel of the University of the Philippines.
It will be recalled that in the U.P. case, there were two contending unions, the Organization of NonAcademic Personnel of U.P. (ONAPUP) and All U.P. Workers Union composed of both academic and
nonacademic personnel of U.P. ONAPUP sought the conduct of certification election among the
rank-and-file non-academic personnel only while the all U.P. Workers Union sought the conduct of
certification election among all of U.P.s rank-and-file employees covering academic and
nonacademic personnel. While the Supreme Court ordered a separate bargaining unit for the U.P.
academic personnel, the Court, however, did not order them to organize a separate labor
organization among themselves. The All U.P. Workers Union was not directed to divest itself of its
academic personnel members and in fact, we take administrative notice that the All U.P. Workers
Union continue to exist with a combined membership of U.P. academic and non-academic personnel
although separate bargaining agreements is sought for the two bargaining units. Corollary, private
respondent can continue to exist as a legitimate labor organization with the combined teaching and
non-teaching personnel in its membership and representing both classes of employees in separate
bargaining negotiations and agreements.
WHEREFORE, the Decision of the Med-Arbiter dated 10 August 2002 is hereby REVERSED and
SET ASIDE. In lieu thereof, a new order is hereby issued directing the conduct of two certification
elections, one among the non-teaching personnel of Holy Child Catholic School, and the other,
among the teaching personnel of the same school, subject to the usual pre-election conferences and
inclusion-exclusion proceedings, with the following choices:
A. Certification Election Among Petitioners Teaching Personnel:
1. Holy Child Catholic School Teachers and Employees Labor Union; and
2. No Union.
B. Certification Election Among Petitioners Non-Teaching Personnel:
1. Holy Child Catholic School Teachers and Employees Labor Union; and
2. No Union.
Petitioner is hereby directed to submit to the Regional Office of origin within ten (10) days from
receipt of this Decision, a certified separate list of its teaching and non-teaching personnel or when
necessary a separate copy of their payroll for the last three (3) months prior to the issuance of this
Decision.20
Petitioner filed a motion for reconsideration21 which, per Resolution dated February 13, 2003, was
denied. Consequently, petitioner filed before the CA a Petition for Certiorari with Prayer for
Temporary Restraining Order and Preliminary Injunction. 22 The CA resolved to defer action on the

prayer for TRO pending the filing of private respondents Comment. 23 Later, private respondent and
petitioner filed their Comment24 and Reply,25respectively.
On July 23, 2003, petitioner filed a motion for immediate issuance of a TRO, alleging that Hon.
Helen F. Dacanay of the Industrial Relations Division of the DOLE was set to implement the SOLE
Decision when it received a summons and was directed to submit a certified list of teaching and nonteaching personnel for the last three months prior to the issuance of the assailed Decision. 26 Acting
thereon, on August 5, 2003, the CA issued the TRO and ordered private respondent to show cause
why the writ of preliminary injunction should not be granted. 27 Subsequently, a Manifestation and
Motion28 was filed by private respondent, stating that it repleads by reference the arguments raised in
its Comment and that it prays for the immediate lifting of the TRO and the denial of the preliminary
injunction. The CA, however, denied the manifestation and motion on November 21, 2003 29 and,
upon motion of petitioner,30 granted the preliminary injunction on April 21, 2005.31 Thereafter, both
parties filed their respective Memorandum.32
On April 18, 2007, the CA eventually dismissed the petition. As to the purported commingling of
managerial, supervisory, and rank-and-file employees in private respondents membership, it held
that the Toyota ruling is inapplicable because the vice-principals, department head, and coordinators
are neither supervisory nor managerial employees. It reasoned:
x x x While it may be true that they wield power over other subordinate employees of the petitioner, it
must be stressed, however, that their functions are not confined with policy-determining such as
hiring, firing, and disciplining of employees, salaries, teaching/working hours, other monetary and
non-monetary benefits, and other terms and conditions of employment. Further, while they may
formulate policies or guidelines, nonetheless, such is merely recommendatory in nature, and still
subject to review and evaluation by the higher executives, i.e., the principals or executive officers of
the petitioner. It cannot also be denied that in institutions like the petitioner, company policies have
already been pre-formulated by the higher executives and all that the mentioned employees have to
do is carry out these company policies and standards. Such being the case, it is crystal clear that
there is no improper commingling of members in the private respondent union as to preclude its
petition for certification of (sic) election.33
Anent the alleged mixture of teaching and non-teaching personnel, the CA agreed with petitioner that
the nature of the formers work does not coincide with that of the latter. Nevertheless, it ruled that the
SOLE did not commit grave abuse of discretion in not dismissing the petition for certification election,
since it directed the conduct of two separate certification elections based on Our ruling in University
of the Philippines v. Ferrer-Calleja.34
A motion for reconsideration35 was filed by petitioner, but the CA denied the same;36 hence, this
petition assigning the alleged errors as follows:
I.
THE HONORABLE COURT OF APPEALS ERRED IN HOLDING THAT THE RULING IN THE CASE
OF TOYOTA MOTOR PHILIPPINES CORPORATION VS. TOYOTA MOTOR PHILIPPINES
CORPORATION LABOR UNION (268 SCRA 573) DOES NOT APPLY IN THE CASE AT BAR

DESPITE THE [COMMINGLING] OF BOTH SUPERVISORY OR MANAGERIAL AND RANK-ANDFILE EMPLOYEES IN THE RESPONDENT UNION;
II
THE HONORABLE COURT OF APPEALS ERRED IN ITS CONFLICTING RULING ALLOWING THE
CONDUCT OF CERTIFICATION ELECTION BY UPHOLDING THAT THE RESPONDENT UNION
REPRESENTED A BARGAINING UNIT DESPITE ITS OWN FINDINGS THAT THERE IS NO
MUTUALITY OF INTEREST BETWEEN THE MEMBERS OF RESPONDENT UNION APPLYING
THE TEST LAID DOWN IN THE CASE OF UNIVERSITY OF THE PHILIPPINES VS. FERRERCALLEJA (211 SCRA 451).37
We deny.
Petitioner claims that the CA contradicted the very definition of managerial and supervisory
employees under existing law and jurisprudence when it did not classify the vice-principals,
department head, and coordinators as managerial or supervisory employees merely because the
policies and guidelines they formulate are still subject to the review and evaluation of the principal or
executive officers of petitioner. It points out that the duties of the vice-principals, department head,
and coordinators include the evaluation and assessment of the effectiveness and capability of the
teachers under them; that such evaluation and assessment is independently made without the
participation of the higher Administration of petitioner; that the fact that their recommendation
undergoes the approval of the higher Administration does not take away the independent nature of
their judgment; and that it would be difficult for the vice-principals, department head, and
coordinators to objectively assess and evaluate the performances of teachers under them if they
would be allowed to be members of the same labor union.
On the other hand, aside from reiterating its previous submissions, private respondent cites Sections
9 and 1238of Republic Act (R.A.) No. 9481 to buttress its contention that petitioner has no standing to
oppose the petition for certification election. On the basis of the statutory provisions, it reasons that
an employer is not a party-in-interest in a certification election; thus, petitioner does not have the
requisite right to protect even by way of restraining order or injunction.
First off, We cannot agree with private respondents invocation of R.A. No. 9481. Said law took effect
only on June 14, 2007; hence, its applicability is limited to labor representation cases filed on or after
said date.39 Instead, the law and rules in force at the time private respondent filed its petition for
certification election on May 31, 2002 are R.A. No. 6715, which amended Book V of Presidential
Decree (P.D.) No. 442 (the Labor Code), as amended, and the Rules and Regulations Implementing
R.A. No. 6715, as amended by D.O. No. 9, which was dated May 1, 1997 but took effect on June 21,
1997.40
However, note must be taken that even without the express provision of Section 12 of RA No. 9481,
the "Bystander Rule" is already well entrenched in this jurisdiction. It has been consistently held in a
number of cases that a certification election is the sole concern of the workers, except when the
employer itself has to file the petition pursuant to Article 259 of the Labor Code, as amended, but
even after such filing its role in the certification process ceases and becomes merely a

bystander.41 The employer clearly lacks the personality to dispute the election and has no right to
interfere at all therein.42 This is so since any uncalled-for concern on the part of the employer may
give rise to the suspicion that it is batting for a company union.43 Indeed, the demand of the law and
policy for an employer to take a strict, hands-off stance in certification elections is based on the
rationale that the employees bargaining representative should be chosen free from any extraneous
influence of the management; that, to be effective, the bargaining representative must owe its loyalty
to the employees alone and to no other.44
Now, going back to petitioners contention, the issue of whether a petition for certification election is
dismissible on the ground that the labor organizations membership allegedly consists of supervisory
and rank-and-file employees is actually not a novel one. In the 2008 case of Republic v. Kawashima
Textile Mfg., Philippines, Inc.,45 wherein the employer-company moved to dismiss the petition for
certification election on the ground inter alia that the union membership is a mixture of rank-and-file
and supervisory employees, this Court had conscientiously discussed the applicability of Toyota and
Dunlop in the context of R.A. No. 6715 and D.O. No. 9, viz.:
It was in R.A. No. 875, under Section 3, that such questioned mingling was first prohibited, to wit:
Sec. 3. Employees' right to self-organization. - 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. Individuals employed as
supervisors shall not be eligible for membership in a labor organization of employees under their
supervision but may form separate organizations of their own. (Emphasis supplied)
Nothing in R.A. No. 875, however, tells of how the questioned mingling can affect the legitimacy of
the labor organization. Under Section 15, the only instance when a labor organization loses its
legitimacy is when it violates its duty to bargain collectively; but there is no word on whether such
mingling would also result in loss of legitimacy. Thus, when the issue of whether the membership of
two supervisory employees impairs the legitimacy of a rank-and-file labor organization came before
the Court En Banc in Lopez v. Chronicle Publication Employees Association, the majority
pronounced:
It may be observed that nothing is said of the effect of such ineligibility upon the union itself or on the
status of the other qualified members thereof should such prohibition be disregarded. Considering
that the law is specific where it intends to divest a legitimate labor union of any of the rights and
privileges granted to it by law, the absence of any provision on the effect of the disqualification of
one of its organizers upon the legality of the union, may be construed to confine the effect of such
ineligibility only upon the membership of the supervisor. In other words, the invalidity of membership
of one of the organizers does not make the union illegal, where the requirements of the law for the
organization thereof are, nevertheless, satisfied and met. (Emphasis supplied)
Then the Labor Code was enacted in 1974 without reproducing Sec. 3 of R.A. No. 875. The
provision in the Labor Code closest to Sec. 3 is Article 290, which is deafeningly silent on the
prohibition against supervisory employees mingling with rank-and-file employees in one labor

organization. Even the Omnibus Rules Implementing Book V of the Labor Code (Omnibus Rules)
merely provides in Section 11, Rule II, thus:
Sec. 11. Supervisory unions and unions of security guards to cease operation. - All existing
supervisory unions and unions of security guards shall, upon the effectivity of the Code, cease to
operate as such and their registration certificates shall be deemed automatically cancelled. However,
existing collective agreements with such unions, the life of which extends beyond the date of
effectivity of the Code shall be respected until their expiry date insofar as the economic benefits
granted therein are concerned.
Members of supervisory unions who do not fall within the definition of managerial employees shall
become eligible to join or assist the rank and file organization. The determination of who are
managerial employees and who are not shall be the subject of negotiation between representatives
of supervisory union and the employer. If no agreement s reached between the parties, either or
both of them may bring the issue to the nearest Regional Office for determination. (Emphasis
supplied)
The obvious repeal of the last clause of Sec. 3, R.A. No. 875 prompted the Court to declare in
Bulletin v. Sanchez that supervisory employees who do not fall under the category of managerial
employees may join or assist in the formation of a labor organization for rank-and-file employees, but
they may not form their own labor organization.
While amending certain provisions of Book V of the Labor Code, E.O. No. 111 and its implementing
rules continued to recognize the right of supervisory employees, who do not fall under the category
of managerial employees, to join a rank- and-file labor organization.
Effective 1989, R.A. No. 6715 restored the prohibition against the questioned mingling in one labor
organization, viz.:
Sec. 18. Article 245 of the same Code, as amended, is hereby further amended to read as follows:
Art. 245. Ineligibility of managerial employees to join any labor organization; right of supervisory
employees. Managerial employees are not eligible to join, assist or form any labor organization.
Supervisory employees shall not be eligible for membership in a labor organization of the rank-andfile employees but may join, assist or form separate labor organizations of their own (Emphasis
supplied)
Unfortunately, just like R.A. No. 875, R.A. No. 6715 omitted specifying the exact effect any violation
of the prohibition would bring about on the legitimacy of a labor organization.
It was the Rules and Regulations Implementing R.A. No. 6715 (1989 Amended Omnibus Rules)
which supplied the deficiency by introducing the following amendment to Rule II (Registration of
Unions):
Sec. 1. Who may join unions. - x x x Supervisory employees and security guards shall not be eligible
for membership in a labor organization of the rank-and-file employees but may join, assist or form

separate labor organizations of their own; Provided, that those supervisory employees who are
included in an existing rank-and-file bargaining unit, upon the effectivity of Republic Act No. 6715,
shall remain in that unit x x x. (Emphasis supplied)
and Rule V (Representation Cases and Internal-Union Conflicts) of the Omnibus Rules, viz.;
Sec. 1. Where to file. - A petition for certification election may be filed with the Regional Office which
has jurisdiction over the principal office of the employer. The petition shall be in writing and under
oath.
Sec. 2. Who may file. - Any legitimate labor organization or the employer, when requested to bargain
collectively, may file the petition.
The petition, when filed by a legitimate labor organization, shall contain, among others:
xxxx
(c) description of the bargaining unit which shall be the employer unit unless circumstances
otherwise require; and provided further, that the appropriate bargaining unit of the rank-and-file
employees shall not include supervisory employees and/or security guards. (Emphasis supplied)
By that provision, any questioned mingling will prevent an otherwise legitimate and duly registered
labor organization from exercising its right to file a petition for certification election.
Thus, when the issue of the effect of mingling was brought to the fore in Toyota, the Court, citing
Article 245 of the Labor Code, as amended by R.A. No. 6715, held:
Clearly, based on this provision, a labor organization composed of both rank-and-file and
supervisory employees is no labor organization at all. It cannot, for any guise or purpose, be a
legitimate labor organization. Not being one, an organization which carries a mixture of rank-and-file
and supervisory employees cannot possess any of the rights of a legitimate labor organization,
including the right to file a petition for certification election for the purpose of collective bargaining. It
becomes necessary, therefore, anterior to the granting of an order allowing a certification election, to
inquire into the composition of any labor organization whenever the status of the labor organization
is challenged on the basis of Article 245 of the Labor Code.
xxxx
In the case at bar, as respondent union's membership list contains the names of at least twentyseven (27) supervisory employees in Level Five positions, the union could not, prior to purging itself
of its supervisory employee members, attain the status of a legitimate labor organization. Not being
one, it cannot possess the requisite personality to file a petition for certification election. (Emphasis
supplied)
In Dunlop, in which the labor organization that filed a petition for certification election was one for
supervisory employees, but in which the membership included rank-and-file employees, the Court

reiterated that such labor organization had no legal right to file a certification election to represent a
bargaining unit composed of supervisors for as long as it counted rank-and-file employees among its
members.
It should be emphasized that the petitions for certification election involved in Toyota and Dunlop
were filed on November 26, 1992 and September 15, 1995, respectively; hence, the 1989 Rules was
applied in both cases.
But then, on June 21, 1997, the 1989 Amended Omnibus Rules was further amended by
Department Order No. 9, series of 1997 (1997 Amended Omnibus Rules). Specifically, the
requirement under Sec. 2(c) of the 1989 Amended Omnibus Rules - that the petition for certification
election indicate that the bargaining unit of rank-and-file employees has not been mingled with
supervisory employees - was removed. Instead, what the 1997 Amended Omnibus Rules requires is
a plain description of the bargaining unit, thus:
Rule XI
Certification Elections
xxxx
Sec. 4. Forms and contents of petition. - The petition shall be in writing and under oath and shall
contain, among others, the following: x x x (c) The description of the bargaining unit."
In Pagpalain Haulers, Inc. v. Trajano, the Court had occasion to uphold the validity of the 1997
Amended Omnibus Rules, although the specific provision involved therein was only Sec. 1, Rule VI,
to wit:
Sec. 1. Chartering and creation of a local/chapter.- A duly registered federation or national union may
directly create a local/chapter by submitting to the Regional Office or to the Bureau two (2) copies of
the following: a) a charter certificate issued by the federation or national union indicating the creation
or establishment of the local/chapter; (b) the names of the local/chapter's officers, their addresses,
and the principal office of the local/chapter; and (c) the local/ chapter's constitution and by-laws;
provided that where the local/chapter's constitution and by-laws is the same as that of the federation
or national union, this fact shall be indicated accordingly.
All the foregoing supporting requirements shall be certified under oath by the Secretary or the
Treasurer of the local/chapter and attested to by its President.
which does not require that, for its creation and registration, a local or chapter submit a list of its
members.
Then came Tagaytay Highlands Int'l. Golf Club, Inc. v. Tagaytay Highlands Employees UnionPTGWO in which the core issue was whether mingling affects the legitimacy of a labor organization
and its right to file a petition for certification election. This time, given the altered legal milieu, the
Court abandoned the view in Toyota and Dunlop and reverted to its pronouncement in Lopez that
while there is a prohibition against the mingling of supervisory and rank-and-file employees in one

labor organization, the Labor Code does not provide for the effects thereof. Thus, the Court held that
after a labor organization has been registered, it may exercise all the rights and privileges of a
legitimate labor organization. Any mingling between supervisory and rank-and-file employees in its
membership cannot affect its legitimacy for that is not among the grounds for cancellation of its
registration, unless such mingling was brought about by misrepresentation, false statement or fraud
under Article 239 of the Labor Code.
In San Miguel Corp. (Mandaue Packaging Products Plants) v. Mandaue Packing Products PlantsSan Miguel Packaging Products-San Miguel Corp. Monthlies Rank-and-File Union-FFW, the Court
explained that since the 1997 Amended Omnibus Rules does not require a local or chapter to
provide a list of its members, it would be improper for the DOLE to deny recognition to said local or
chapter on account of any question pertaining to its individual members.
More to the point is Air Philippines Corporation v. Bureau of Labor Relations, which involved a
petition for cancellation of union registration filed by the employer in 1999 against a rank-and-file
labor organization on the ground of mixed membership: the Court therein reiterated its ruling in
Tagaytay Highlands that the inclusion in a union of disqualified employees is not among the grounds
for cancellation, unless such inclusion is due to misrepresentation, false statement or fraud under
the circumstances enumerated in Sections (a) and (c) of Article 239 of the Labor Code.
All said, while the latest issuance is R.A. No. 9481, the 1997 Amended Omnibus Rules, as
interpreted by the Court in Tagaytay Highlands, San Miguel and Air Philippines, had already set the
tone for it. Toyota and Dunlop no longer hold sway in the present altered state of the law and the
rules.46
When a similar issue confronted this Court close to three years later, the above ruling was
substantially quoted in Samahang Manggagawa sa Charter Chemical Solidarity of Unions in the
Philippines for Empowerment and Reforms (SMCC-Super) v. Charter Chemical and Coating
Corporation.47 In unequivocal terms, We reiterated that the alleged inclusionof supervisory
employees in a labor organization seeking to represent the bargaining unit of rank-and-file
employees does not divest it of its status as a legitimate labor organization. 48
Indeed, Toyota and Dunlop no longer hold true under the law and rules governing the instant case.
The petitions for certification election involved in Toyota and Dunlop were filed on November 26,
1992 and September 15, 1995, respectively; hence, the 1989 Rules and Regulations Implementing
R.A. No. 6715 (1989 Amended Omnibus Rules) was applied. In contrast, D.O. No. 9 is applicable in
the petition for certification election of private respondent as it was filed on May 31, 2002.
Following the doctrine laid down in Kawashima and SMCC-Super, it must be stressed that petitioner
cannot collaterally attack the legitimacy of private respondent by praying for the dismissal of the
petition for certification election:
Except when it is requested to bargain collectively, an employer is a mere bystander to any petition
for certification election; such proceeding is non-adversarial and merely investigative, for the
purpose thereof is to determine which organization will represent the employees in their collective
bargaining with the employer. The choice of their representative is the exclusive concern of the

employees; the employer cannot have any partisan interest therein; it cannot interfere with, much
less oppose, the process by filing a motion to dismiss or an appeal from it; not even a mere
allegation that some employees participating in a petition for certification election are actually
managerial employees will lend an employer legal personality to block the certification election. The
employer's only right in the proceeding is to be notified or informed thereof.
The amendments to the Labor Code and its implementing rules have buttressed that policy even
more.49
Further, the determination of whether union membership comprises managerial and/or supervisory
employees is a factual issue that is best left for resolution in the inclusion-exclusion proceedings,
which has not yet happened in this case so still premature to pass upon. We could only emphasize
the rule that factual findings of labor officials, who are deemed to have acquired expertise in matters
within their jurisdiction, are generally accorded not only with respect but even finality by the courts
when supported by substantial evidence.50 Also, the jurisdiction of this Court in cases brought before
it from the CA via Rule 45 is generally limited to reviewing errors of law or jurisdiction. The findings of
fact of the CA are conclusive and binding. Except in certain recognized instances, 51We do not
entertain factual issues as it is not Our function to analyze or weigh evidence all over again; the
evaluation of facts is best left to the lower courts and administrative agencies/quasi-judicial bodies
which are better equipped for the task.52
Turning now to the second and last issue, petitioner argues that, in view of the improper mixture of
teaching and non-teaching personnel in private respondent due to the absence of mutuality of
interest among its members, the petition for certification election should have been dismissed on the
ground that private respondent is not qualified to file such petition for its failure to qualify as a
legitimate labor organization, the basic qualification of which is the representation of an appropriate
bargaining unit.
We disagree.
The concepts of a union and of a legitimate labor organization are different from, but related to, the
concept of a bargaining unit:
Article 212(g) of the Labor Code defines a labor organization as "any union or association of
employees which exists in whole or in part for the purpose of collective bargaining or of dealing with
employers concerning terms and conditions of employment." Upon compliance with all the
documentary requirements, the Regional Office or Bureau shall issue in favor of the applicant labor
organization a certificate indicating that it is included in the roster of legitimate labor organizations.
Any applicant labor organization shall acquire legal personality and shall be entitled to the rights and
privileges granted by law to legitimate labor organizations upon issuance of the certificate of
registration.53
In case of alleged inclusion of disqualified employees in a union, the proper procedure for an
employer like petitioner is to directly file a petition for cancellation of the unions certificate of
registration due to misrepresentation, false statement or fraud under the circumstances enumerated
in Article 239 of the Labor Code, as amended.54 To reiterate, private respondent, having been validly

issued a certificate of registration, should be considered as having acquired juridical personality

which may not be attacked collaterally.
On the other hand, 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
interests of all the employees, consistent with equity to the employer, indicated to be best suited to
serve reciprocal rights and duties of the parties under the collective bargaining provisions of the
law."55 In determining the proper collective bargaining unit and what unit would be appropriate to be
the collective bargaining agency, the Court, in the seminal case of Democratic Labor Association v.
Cebu Stevedoring Company, Inc.,56 mentioned several factors that should be considered, to wit: (1)
will of employees (Globe Doctrine); (2) affinity and unity of employees' interest, such as substantial
similarity of work and duties, or similarity of compensation and working conditions; (3) prior collective
bargaining history; and (4) employment status, such as temporary, seasonal and probationary
employees. We stressed, however, that the test of the grouping is community or mutuality of interest,
because "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."57
As the SOLE correctly observed, petitioner failed to comprehend the full import of Our ruling in U.P. It
suffices to quote with approval the apt disposition of the SOLE when she denied petitioners motion
for reconsideration:
Petitioner likewise claimed that we erred in interpreting the decision of the Supreme Court in U.P. v.
Ferrer-Calleja, supra. According to petitioner, the Supreme Court stated that the non-academic rankandfile employees of the University of the Philippines shall constitute a bargaining unit to the
exclusion of the academic employees of the institution. Hence, petitioner argues, it sought the
creation of separate bargaining units, namely: (1) petitioners teaching personnel to the exclusion of
non-teaching personnel; and (2) petitioners non-teaching personnel to the exclusion of teaching
personnel.
Petitioner appears to have confused the concepts of membership in a bargaining unit and
membership in a union. In emphasizing the phrase "to the exclusion of academic employees" stated
in U.P. v. Ferrer-Calleja, petitioner believed that the petitioning union could not admit academic
employees of the university to its membership. But such was not the intention of the Supreme Court.
A bargaining unit is a group of employees sought to be represented by a petitioning union. Such
employees need not be members of a union seeking the conduct of a certification election. A union
certified as an exclusive bargaining agent represents not only its members but also other employees
who are not union members. As pointed out in our assailed Decision, there were two contending
unions in the U.P. case, namely, the Organization of Non-Academic Personnel of U.P. (ONAPUP)
and the All U.P. Workers Union composed of both U.P. academic and non-academic personnel.
ONAPUP sought the conduct of a certification election among the rank-and-file non-academic
personnel only, while the All U.P. Workers Union intended to cover all U.P. rank-and-file employees,
involving both academic and non-academic personnel.

The Supreme Court ordered the "non-academic rank-and-file employees of U.P. to constitute a
bargaining unit to the exclusion of the academic employees of the institution", but did not order them
to organize a separate labor organization. In the U.P. case, the Supreme Court did not dismiss the
petition and affirmed the order for the conduct of a certification election among the non-academic
personnel of U.P., without prejudice to the right of the academic personnel to constitute a separate
bargaining unit for themselves and for the All U.P. Workers Union to institute a petition for
certification election.
In the same manner, the teaching and non-teaching personnel of petitioner school must form
separate bargaining units. Thus, the order for the conduct of two separate certification elections,
one involving teaching personnel and the other involving non-teaching personnel. It should be
stressed that in the subject petition, private respondent union sought the conduct of a certification
election among all the rank-and-file personnel of petitioner school. Since the decision of the
Supreme Court in the U.P. case prohibits us from commingling teaching and non-teaching personnel
in one bargaining unit, they have to be separated into two separate bargaining units with two
separate certification elections to determine whether the employees in the respective bargaining
units desired to be represented by private respondent. In the U.P. case, only one certification
election among the non-academic personnel was ordered, because ONAPUP sought to represent
that bargaining unit only. No petition for certification election among the academic personnel was
instituted by All U.P. Workers Union in the said case; thus, no certification election pertaining to its
intended bargaining unit was ordered by the Court.58
1wphi1

Indeed, the purpose of a certification election is precisely to ascertain the majority of the employees
choice of an appropriate bargaining unit to be or not to be represented by a labor organization and,
if in the affirmative case, by which one.59
At this point, it is not amiss to stress once more that, as a rule, only questions of law may be raised
in a Rule 45 petition. In Montoya v. Transmed Manila Corporation,60 the Court discussed the
particular parameters of a Rule 45 appeal from the CAs Rule 65 decision on a labor case, as
follows:
x x x In a Rule 45 review, we consider the correctness of the assailed CA decision, in contrast with
the review for jurisdictional error that we undertake under Rule 65. Furthermore, Rule 45 limits us to
the review of questions of law raised against the assailed CA decision. In ruling for legal correctness,
we have to view the CA decision in the same context that the petition for certiorari it ruled upon was
presented to it; we have to examine the CA decision from the prism of whether it correctly
determined the presence or absence of grave abuse of discretion in the NLRC decision before it, not
on the basis of whether the NLRC decision on the merits of the case was correct. In other words, we
have to be keenly aware that the CA undertook a Rule 65 review, not a review on appeal, of the
NLRC decision challenged before it. This is the approach that should be basic in a Rule 45 review of
a CA ruling in a labor case. In question form, the question to ask is: Did the CA correctly determine
whether the NLRC committed grave abuse of discretion in ruling on the case? 61
Our review is, therefore, limited to the determination of whether the CA correctly resolved the
presence or absence of grave abuse of discretion in the decision of the SOLE, not on the basis of
whether the latter's decision on the merits of the case was strictly correct. Whether the CA

committed grave abuse of discretion is not what is ruled upon but whether it correctly determined the
existence or want of grave abuse of discretion on the part of the SOLE.
WHEREFORE, the pet1t1on is DENIED. The April 18, 2007 Decision and July 31, 2007, Resolution
of the Court of Appeals in CA-G.R. SP No. 76175, which affirmed the December 27, 2002 Decision
of the Secretary of the Department of Labor and Employment that set aside the
August 10, 2002 Decision of the Med-Arbiter denying private respondent's petition for certification
election are hereby AFFIRMED.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 160352

July 23, 2008

REPUBLIC OF THE PHILIPPINES, represented by Department of Labor and Employment

(DOLE), Petitioner,
vs.
KAWASHIMA TEXTILE MFG., PHILIPPINES, INC., Respondent.
DECISION
AUSTRIA-MARTINEZ, J.:
The Republic of the Philippines assails by way of Petition for Review on Certiorari under Rule 45 of
the Rules of Court, the December 13, 2002 Decision1 of the Court of Appeals (CA), which reversed
the August 18, 2000 Decision2 of the Department of Labor and Employment (DOLE), and reinstated
the May 17, 2000 Order3 of Med-Arbiter Anastacio L. Bactin, dismissing the petition of Kawashima
Free Workers Union-PTGWO Local Chapter No. 803 (KFWU) for the conduct of a certification
election in Kawashima Textile Mfg. Phils., Inc. (respondent); and the October 7, 2003 CA
Resolution4 which denied the motion for reconsideration.
The relevant facts are of record.
On January 24, 2000, KFWU filed with DOLE Regional Office No. IV, a Petition for Certification
Election to be conducted in the bargaining unit composed of 145 rank-and-file employees of
respondent.5 Attached to its petition are a Certificate of Creation of Local/Chapter 6 issued on January
19, 2000 by DOLE Regional Office No. IV, stating that it [KFWU] submitted to said office a Charter
Certificate issued to it by the national federation Phil. Transport & General Workers Organization
(PTGWO), and a Report of Creation of Local/Chapter.7
Respondent filed a Motion to Dismiss8 the petition on the ground that KFWU did not acquire any
legal personality because its membership of mixed rank-and-file and supervisory employees violated
Article 245 of the Labor Code, and its failure to submit its books of account contravened the ruling of
the Court in Progressive Development Corporation v. Secretary, Department of Labor and
Employment.9
In an Order dated May 17, 2000, Med-Arbiter Bactin found KFWUs legal personality defective and
dismissed its petition for certification election, thus:

We scrutinize the facts and evidences presented by the parties and arrived at a decision that at least
two (2) members of [KFWU], namely: Dany I. Fernandez and Jesus R. Quinto, Jr. are supervisory
employees, having a number of personnel under them. Being supervisory employees, they are
prohibited under Article 245 of the Labor Code, as amended, to join the union of the rank and file
employees. Dany I. Fernandez and Jesus R. Quinto, Jr., Chief Engineers of the Maintenance and
Manufacturing Department, respectively, act as foremen to the line engineers, mechanics and other
non-skilled workers and responsible [for] the preparation and organization of maintenance shop
fabrication and schedules, inventory and control of materials and supplies and tasked to implement
training plans on line engineers and evaluate the performance of their subordinates. The abovestated actual functions of Dany I. Fernandez and Jesus R. Quinto, Jr. are clear manifestation that
they are supervisory employees.
xxxx
Since petitioners members are mixture of rank and file and supervisory employees,
petitioner union, at this point [in] time, has not attained the status of a legitimate labor
organization. Petitioner should first exclude the supervisory employees from it membership
before it can attain the status of a legitimate labor organization. The above judgment is
supported by the decision of the Supreme Court in the Toyota Case 10 wherein the High Tribunal
ruled:
"As respondent unions membership list contains the names of at least twenty seven (27)
supervisory employees in Level Five Positions, the union could not prior to purging itself of its
supervisory employee members, attain the status of a legitimate labor organization. Not being one, it
cannot possess the requisite personality to file a petition for certification election." (Underscoring
omitted.)
xxxx
Furthermore, the commingling of rank and file and supervisory employees in one (1) bargaining unit
cannot be cured in the exclusion-inclusion proceedings [at] the pre-election conference. The above
ruling is supported by the Decision of the Supreme Court in Dunlop Slazenger (Phils.), Inc. vs.
Honorable Secretary of Labor and Employment, et al., G.R. No. 131248 dated December 11,
199811 x x x.
xxxx
WHEREFORE, premises considered, the petition for certification election is hereby dismissed for
lack of requisite legal status of petitioner to file this instant petition.
SO ORDERED.12 (Emphasis supplied)
On the basis of the aforecited decision, respondent filed with DOLE Regional Office No. IV a Petition
for Cancellation of Charter/Union Registration of KFWU,13 the final outcome of which, unfortunately,
cannot be ascertained from the records.

Meanwhile, KFWU appealed14 to the DOLE which issued a Decision on August 18, 2000, the
dispositive portion of which reads:
WHEREFORE, the appeal is GRANTED. The Order dated 17 May 2000 of the Med-Arbiter is
REVERSED and SET ASIDE. Accordingly, let the entire records of the case be remanded to the
office of origin for the immediate conduct of certification election, subject to the usual pre-election
conference, among the rank-and-file employees of Kawashima Textile Manufacturing Philippines,
Inc. with the following choices:
1. Kawashima Free Workers Union-PTGWO Local Chapter No. 803; and
2. No union.
Pursuant to Rule XI, Section 11.1 of the New Implementing Rules, the employer is hereby directed to
submit to the office of origin the certified list of current employees in the bargaining unit for the last
three months prior to the issuance of this decision.
SO DECIDED.15
The DOLE held that Med-Arbiter Bactin's reliance on the decisions of the Court in Toyota Motor
Philippines Corporation v. Toyota Motor Philippines Corporation Labor Union16 and Dunlop
Slazenger, Inc. v. Secretary of Labor and Employment 17 was misplaced, for while Article 245 declares
supervisory employees ineligible for membership in a labor organization for rank-and-file employees,
the provision did not state the effect of such prohibited membership on the legitimacy of the labor
organization and its right to file for certification election. Neither was such mixed membership a
ground for cancellation of its registration. Section 11, Paragraph II, Rule XI of Department Order No.
9 "provides for the dismissal of a petition for certification election based on lack of legal personality
of a labor organization only on the following grounds: (1) [KFWU] is not listed by the Regional Office
or the Bureau of Labor Relations in its registry of legitimate labor organizations; or (2) [KFWU's] legal
personality has been revoked or canceled with finality." 18 The DOLE noted that neither ground
existed; on the contrary, KFWU's legal personality was well-established, for it held a certificate of
creation and had been listed in the registry of legitimate labor organizations.
As to the failure of KFWU to file its books of account, the DOLE held that such omission was not a
ground for revocation of union registration or dismissal of petition for certification election, for under
Section 1, Rule VI of Department Order No. 9, a local or chapter like KFWU was no longer required
to file its books of account.19
Respondent filed a Motion for Reconsideration20 but the DOLE denied the same in its September 28,
2000 Resolution.21
However, on appeal by respondent, the CA rendered the December 13, 2002 Decision assailed
herein, reversing the August 18, 2000 DOLE Decision, thus:
Since respondent union clearly consists of both rank and file and supervisory employees, it
cannot qualify as a legitimate labor organization imbued with the requisite personality to file

a petition for certification election. This infirmity in union membership cannot be corrected in
the inclusion-exclusion proceedings during the pre-election conference.
Finally, contrary to the pronouncement of public respondent, the application of the doctrine
enunciated in Toyota Motor Philippines Corporation vs. Toyota Motor Philippines Corporation Labor
Union was not construed in a way that effectively denies the fundamental right of respondent union
to organize and seek bargaining representation x x x.
For ignoring jurisprudential precepts on the matter, the Court finds that the Undersecretary of Labor,
acting under the authority of the Secretary of Labor, acted with grave abuse of discretion amounting
to lack or excess of jurisdiction.
WHEREFORE, premises considered, the Petition is hereby GRANTED. The Decision dated 18
August 2000 of the Undersecretary of Labor, acting under the authority of the Secretary, is hereby
REVERSED and SET ASIDE. The Order dated 17 May 2000 of the Med-Arbiter dismissing the
petition for certification election filed by Kawashima Free Workers Union-PTGWO Local Chapter No.
803 is REINSTATED.
SO ORDERED.22 (Emphasis supplied)
KFWU filed a Motion for Reconsideration23 but the CA denied it.
The Republic of the Philippines (petitioner) filed the present petition to seek closure on two issues:
First, whether a mixed membership of rank-and-file and supervisory employees in a union is a
ground for the dismissal of a petition for certification election in view of the amendment brought
about by D.O. 9, series of 1997, which deleted the phraseology in the old rule that "[t]he appropriate
bargaining unit of the rank-and-file employee shall not include the supervisory employees and/or
security guards;" and
Second, whether the legitimacy of a duly registered labor organization can be collaterally attacked in
a petition for a certification election through a motion to dismiss filed by an employer such as
Kawashima Textile Manufacturing Phils., Inc.24
The petition is imbued with merit.
The key to the closure that petitioner seeks could have been Republic Act (R.A.) No.
9481.25 Sections 8 and 9 thereof provide:
Section 8. Article 245 of the Labor Code is hereby amended to read as follows:
"Art. 245. Ineligibility of Managerial Employees to Join any Labor Organization; Right of Supervisory
Employees. - Managerial employees are not eligible to join, assist or form any labor organization.
Supervisory employees shall not be eligible for membership in the collective bargaining unit of the
rank-and-file employees but may join, assist or form separate collective bargaining units and/or

legitimate labor organizations of their own. The rank and file union and the supervisors' union
operating within the same establishment may join the same federation or national union."
Section 9. A new provision, Article 245-A is inserted into the Labor Code to read as follows:
"Art. 245-A. Effect of Inclusion as Members of Employees Outside the Bargaining Unit. - The
inclusion as union members of employees outside the bargaining unit shall not be a ground
for the cancellation of the registration of the union. Said employees are automatically
deemed removed from the list of membership of said union." (Emphasis supplied)
Moreover, under Section 4, a pending petition for cancellation of registration
will not hinder a legitimate labor organization from initiating a certification election, viz:
Sec. 4. A new provision is hereby inserted into the Labor Code as Article 238-A to read as follows:
"Art. 238-A. Effect of a Petition for Cancellation of Registration. - A petition for cancellation of
union registration shall not suspend the proceedings for certification election nor shall it
prevent the filing of a petition for certification election.
In case of cancellation, nothing herein shall restrict the right of the union to seek just and equitable
remedies in the appropriate courts." (Emphasis supplied)
Furthermore, under Section 12 of R.A. No. 9481, employers have no personality to interfere with or
thwart a petition for certification election filed by a legitimate labor organization, to wit:
Sec. 12. A new provision, Article 258-A is hereby inserted into the Labor Code to read as follows:
"Art. 258-A. Employer as Bystander. - In all cases, whether the petition for certification election is
filed by an employer or a legitimate labor organization, the employer shall not be considered a
party thereto with a concomitant right to oppose a petition for certification election. The
employer's participation in such proceedings shall be limited to: (1) being notified or
informed of petitions of such nature; and (2) submitting the list of employees during the preelection conference should the Med-Arbiter act favorably on the petition." (Emphasis supplied)
However, R.A. No. 9481 took effect only on June 14, 2007; 26 hence, it applies only to labor
representation cases filed on or after said date. 27 As the petition for certification election subject
matter of the present petition was filed by KFWU on January 24, 2000, 28 R.A. No. 9481 cannot apply
to it. There may have been curative labor legislations29 that were given retrospective effect,30 but not
the aforecited provisions of R.A. No. 9481, for otherwise, substantive rights and interests already
vested would be impaired in the process.31
Instead, the law and rules in force at the time of the filing by KFWU of the petition for certification
election on January 24, 2000 are R.A. No. 6715,32 amending Book V of Presidential Decree (P.D.)
No. 442 (Labor Code),33as amended, and the Rules and Regulations Implementing R.A. No.
6715,34 as amended by Department Order No. 9, series of 1997. 35

It is within the parameters of R.A. No. 6715 and the Implementing Rules that the Court will now
resolve the two issues raised by petitioner.
If there is one constant precept in our labor laws be it Commonwealth Act No. 213 (1936), 36 R.A.
No. 875 (1953),37 P.D. No. 442 (1974), Executive Order (E.O.) No. 111 (1986)38 or R.A. No. 6715
(1989) - it is that only a legitimate labor organization may exercise the right to be certified as the
exclusive representative of all the employees in an appropriate collective bargaining unit for
purposes of collective bargaining.39 What has varied over the years has been the degree of
enforcement of this precept, as reflected in the shifting scope of administrative and judicial scrutiny
of the composition of a labor organization before it is allowed to exercise the right of representation.
One area of contention has been the composition of the membership of a labor organization,
specifically whether there is a mingling of supervisory and rank-and-file employees and how such
questioned mingling affects its legitimacy.
It was in R.A. No. 875, under Section 3, that such questioned mingling was first prohibited, 40 to wit:
Sec. 3. Employees right to self-organization. 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. Individuals employed as
supervisors shall not be eligible for membership in a labor organization of employees under their
supervision but may form separate organizations of their own. (Emphasis supplied)
Nothing in R.A. No. 875, however, tells of how the questioned mingling can affect the legitimacy of
the labor organization. Under Section 15, the only instance when a labor organization loses its
legitimacy is when it violates its duty to bargain collectively; but there is no word on whether such
mingling would also result in loss of legitimacy. Thus, when the issue of whether the membership of
two supervisory employees impairs the legitimacy of a rank-and-file labor organization came before
the Court En Banc in Lopez v. Chronicle Publication Employees Association, 41 the majority
pronounced:
It may be observed that nothing is said of the effect of such ineligibility upon the union itself or on the
status of the other qualified members thereof should such prohibition be disregarded. Considering
that the law is specific where it intends to divest a legitimate labor union of any of the rights and
privileges granted to it by law, the absence of any provision on the effect of the disqualification of
one of its organizers upon the legality of the union, may be construed to confine the effect of such
ineligibility only upon the membership of the supervisor. In other words, the invalidity of membership
of one of the organizers does not make the union illegal, where the requirements of the law for the
organization thereof are, nevertheless, satisfied and met.42 (Emphasis supplied)
Then the Labor Code was enacted in 1974 without reproducing Sec. 3 of R.A. No. 875. The
provision in the Labor Code closest to Sec. 3 is Article 290,43 which is deafeningly silent on the
prohibition against supervisory employees mingling with rank-and-file employees in one labor
organization. Even the Omnibus Rules Implementing Book V of the Labor Code44 (Omnibus Rules)
merely provides in Section 11, Rule II, thus:

Sec. 11. Supervisory unions and unions of security guards to cease operation. All existing
supervisory unions and unions of security guards shall, upon the effectivity of the Code, cease to
operate as such and their registration certificates shall be deemed automatically cancelled. However,
existing collective agreements with such unions, the life of which extends beyond the date of
effectivity of the Code shall be respected until their expiry date insofar as the economic benefits
granted therein are concerned.
Members of supervisory unions who do not fall within the definition of managerial employees shall
become eligible to join or assist the rank and file organization. The determination of who are
managerial employees and who are not shall be the subject of negotiation between representatives
of supervisory union and the employer. If no agreement s reached between the parties, either or
both of them ma bring the issue to the nearest Regional Office for determination. (Emphasis
supplied)
The obvious repeal of the last clause of Sec. 3, R.A. No. 875 prompted the Court to declare in
Bulletin v. Sanchez45 that supervisory employees who do not fall under the category of managerial
employees may join or assist in the formation of a labor organization for rank-and-file employees, but
they may not form their own labor organization.
While amending certain provisions of Book V of the Labor Code, E.O. No. 111 and its implementing
rules46continued to recognize the right of supervisory employees, who do not fall under the category
of managerial employees, to join a rank-and-file labor organization. 47
Effective 1989, R.A. No. 6715 restored the prohibition against the questioned mingling in one labor
organization, viz:
Sec. 18. Article 245 of the same Code, as amended, is hereby further amended to read as follows
"Art. 245. Ineligibility of managerial employees to join any labor organization; right of
supervisory employees. Managerial employees are not eligible to join, assist or form any labor
organization. Supervisory employees shall not be eligible for membership in a labor organization of
the rank-and-file employees but may join, assist or form separate labor organizations of their own."
(Emphasis supplied)
Unfortunately, just like R.A. No. 875, R.A. No. 6715 omitted specifying the exact effect any violation
of the prohibition would bring about on the legitimacy of a labor organization.
It was the Rules and Regulations Implementing R.A. No. 6715 (1989 Amended Omnibus Rules)
which supplied the deficiency by introducing the following amendment to Rule II (Registration of
Unions):
Sec. 1. Who may join unions. x x x Supervisory employees and security guards shall not be
eligible for membership in a labor organization of the rank-and-file employees but may join, assist or
form separate labor organizations of their own; Provided, that those supervisory employees who are
included in an existing rank-and-file bargaining unit, upon the effectivity of Republic Act No. 6715,
shall remain in that unit x x x. (Emphasis supplied)

and Rule V (Representation Cases and Internal-Union Conflicts) of the Omnibus Rules, viz:
Sec. 1. Where to file. A petition for certification election may be filed with the Regional Office which
has jurisdiction over the principal office of the employer. The petition shall be in writing and under
oath.
Sec. 2. Who may file. Any legitimate labor organization or the employer, when requested to
bargain collectively, may file the petition.
The petition, when filed by a legitimate labor organization, shall contain, among others:
xxxx
(c) description of the bargaining unit which shall be the employer unit unless circumstances
otherwise require; and provided further, that the appropriate bargaining unit of the rank-and-file
employees shall not include supervisory employees and/or security guards. (Emphasis supplied)
By that provision, any questioned mingling will prevent an otherwise legitimate and duly registered
labor organization from exercising its right to file a petition for certification election.
Thus, when the issue of the effect of mingling was brought to the fore in Toyota, 48 the Court, citing
Article 245 of the Labor Code, as amended by R.A. No. 6715, held:
Clearly, based on this provision, a labor organization composed of both rank-and-file and
supervisory employees is no labor organization at all. It cannot, for any guise or purpose, be a
legitimate labor organization. Not being one, an organization which carries a mixture of rankand-file and supervisory employees cannot possess any of the rights of a legitimate labor
organization, including the right to file a petition for certification election for the purpose of
collective bargaining. It becomes necessary, therefore, anterior to the granting of an order allowing
a certification election, to inquire into the composition of any labor organization whenever the status
of the labor organization is challenged on the basis of Article 245 of the Labor Code.
xxxx
In the case at bar, as respondent union's membership list contains the names of at least twentyseven (27) supervisory employees in Level Five positions, the union could not, prior to purging itself
of its supervisory employee members, attain the status of a legitimate labor organization. Not being
one, it cannot possess the requisite personality to file a petition for certification election. 49 (Emphasis
supplied)
In Dunlop,50 in which the labor organization that filed a petition for certification election was one for
supervisory employees, but in which the membership included rank-and-file employees, the Court
reiterated that such labor organization had no legal right to file a certification election to represent a
bargaining unit composed of supervisors for as long as it counted rank-and-file employees among its
members.51

It should be emphasized that the petitions for certification election involved in Toyota and Dunlop
were filed on November 26, 1992 and September 15, 1995, respectively; hence, the 1989 Rules was
applied in both cases.
But then, on June 21, 1997, the 1989 Amended Omnibus Rules was further amended by
Department Order No. 9, series of 1997 (1997 Amended Omnibus Rules). Specifically, the
requirement under Sec. 2(c) of the 1989 Amended Omnibus Rules - that the petition for certification
election indicate that the bargaining unit of rank-and-file employees has not been mingled with
supervisory employees - was removed. Instead, what the 1997 Amended Omnibus Rules requires is
a plain description of the bargaining unit, thus:
Rule XI
Certification Elections
xxxx
Sec. 4. Forms and contents of petition. - The petition shall be in writing and under oath and shall
contain, among others, the following: x x x (c) The description of the bargaining unit. 52
In Pagpalain Haulers, Inc. v. Trajano,53 the Court had occasion to uphold the validity of the 1997
Amended Omnibus Rules, although the specific provision involved therein was only Sec. 1, Rule VI,
to wit:
Sec. 1. Chartering and creation of a local/chapter.- A duly registered federation or national union
may directly create a local/chapter by submitting to the Regional Office or to the Bureau two (2)
copies of the following: a) a charter certificate issued by the federation or national union indicating
the creation or establishment of the local/chapter; (b) the names of the local/chapters officers, their
addresses, and the principal office of the local/chapter; and (c) the local/ chapters constitution and
by-laws; provided that where the local/chapters constitution and by-laws is the same as that of the
federation or national union, this fact shall be indicated accordingly.
All the foregoing supporting requirements shall be certified under oath by the Secretary or the
Treasurer of the local/chapter and attested to by its President.
which does not require that, for its creation and registration, a local or chapter submit a list of its
members.
Then came Tagaytay Highlands Intl. Golf Club, Inc. v. Tagaytay Highlands Employees UnionPGTWO54 in which the core issue was whether mingling affects the legitimacy of a labor organization
and its right to file a petition for certification election. This time, given the altered legal milieu, the
Court abandoned the view in Toyota and Dunlop and reverted to its pronouncement in Lopez that
while there is a prohibition against the mingling of supervisory and rank-and-file employees in one
labor organization, the Labor Code does not provide for the effects thereof. 55Thus, the Court held
that after a labor organization has been registered, it may exercise all the rights and privileges of a
legitimate labor organization. Any mingling between supervisory and rank-and-file employees in its
membership cannot affect its legitimacy for that is not among the grounds for cancellation of its

registration, unless such mingling was brought about by misrepresentation, false statement or fraud
under Article 239 of the Labor Code.56
In San Miguel Corp. (Mandaue Packaging Products Plants) v. Mandaue Packing Products PlantsSan Miguel Packaging Products-San Miguel Corp. Monthlies Rank-and-File Union-FFW,57 the Court
explained that since the 1997 Amended Omnibus Rules does not require a local or chapter to
provide a list of its members, it would be improper for the DOLE to deny recognition to said local or
chapter on account of any question pertaining to its individual members. 58
More to the point is Air Philippines Corporation v. Bureau of Labor Relations, 59 which involved a
petition for cancellation of union registration filed by the employer in 1999 against a rank-and-file
labor organization on the ground of mixed membership:60 the Court therein reiterated its ruling in
Tagaytay Highlands that the inclusion in a union of disqualified employees is not among the grounds
for cancellation, unless such inclusion is due to misrepresentation, false statement or fraud under
the circumstances enumerated in Sections (a) and (c) of Article 239 of the Labor Code. 61
lavvphil

All said, while the latest issuance is R.A. No. 9481, the 1997 Amended Omnibus Rules, as
interpreted by the Court in Tagaytay Highlands, San Miguel and Air Philippines, had already set the
tone for it. Toyota and Dunlop no longer hold sway in the present altered state of the law and the
rules.
Consequently, the Court reverses the ruling of the CA and reinstates that of the DOLE granting the
petition for certification election of KFWU.
Now to the second issue of whether an employer like respondent may collaterally attack the
legitimacy of a labor organization by filing a motion to dismiss the latters petition for certification
election.
Except when it is requested to bargain collectively,62 an employer is a mere bystander to any petition
for certification election; such proceeding is non-adversarial and merely investigative, for the
purpose thereof is to determine which organization will represent the employees in their collective
bargaining with the employer.63 The choice of their representative is the exclusive concern of the
employees; the employer cannot have any partisan interest therein; it cannot interfere with, much
less oppose, the process by filing a motion to dismiss or an appeal from it; 64 not even a mere
allegation that some employees participating in a petition for certification election are actually
managerial employees will lend an employer legal personality to block the certification election. 65 The
employer's only
right in the proceeding is to be notified or informed thereof.66
The amendments to the Labor Code and its implementing rules have buttressed that policy even
more.
WHEREFORE, the petition is GRANTED. The December 13, 2002 Decision and October 7, 2003
Resolution of the Court of Appeals and the May 17, 2000 Order of Med-Arbiter Anastacio L. Bactin

are REVERSED and SETASIDE, while the August 18, 2000 Decision and September 28, 2000
Resolution of the Department of Labor and Employment are REINSTATED.
No costs.
SO ORDERED.