DIVINE WORD UNIVERSITY OF TACLOBAN, Petitioner, -versus- G.R. No.

91915 September
11, 1992 SECRETARY OF LABOR AND EMPLOYMENT and DIVINE WORD UNIVERSITY
EMPLOYEES UNIONALU, Respondents. x-------------------

FACTS:
1. Divine Divine Word University Employees Union (DWUEU) was certified as the sole and
exclusive bargaining agent of the Divine Word University.
2. On March 7, 1985, DWUEU submitted its collective bargaining proposals.
3. However, two days before the scheduled conference or on May 26, 1985, DWUEUs
resigned vice-president Mr. Brigido Urminita (or Urmeneta) wrote a letter addressed to the
University unilaterally withdrawing the CBA proposals.
4. After almost three years, or on March 11, 1988, DWUEU, which had by then affiliated
with the Associated Labor Union requested a conference with the University for the purpose
of continuing the collective bargaining negotiations.
5. University kept their silence regarding the requested conference.
6. On April 25, 1988, DWUEU-ALU filed with the National Conciliation and Mediation Board
of the Department of Labor and Employment a notice of strike on the grounds of bargaining
deadlock and unfair labor practice acts, specifically, refusal to bargain, discrimination and
coercion on (sic) employees
7. The conferences which were held after the filing of the notice of strike led to the
conclusion of an agreement between the University and DWUEU-ALU.
8. However, it turned out that an hour before the May 10, 1988 agreement was concluded,
the University had filed a petition for certification election with the Region VIII office of the
Department of Labor and Employment.
9. DWUEU-ALU, consonant with the agreement, submitted its collective bargaining
proposals. These were ignored by the University.
10. Thereafter, through the National Conciliation and Mediation Board (NCMB) of Region
VIII, marathon conciliation conferences were conducted but to no avail.
11. SOLE issued an Order assuming jurisdiction over the labor dispute and directing all
striking workers to report back to work within twenty-four (24) hours and the management
to accept them back under the same terms and conditions prevailing prior to the work
stoppage.
12. SOLE designated the NCMB to hear the case and to submit its report thereon.
13. Med-Arbiter Rodolfo S. Milado, acting on the Universitys petition for certification
election, issued an Order directing the conduct of a certification election to be participated

in by DWUEU-ALU and no union, after he found the petition to be well-supported in fact

and in law.
14. Said Order prompted the DWUEU-ALU to file with the Secretary of Labor an urgent
motion seeking to enjoin Milado from further acting on the matter of the certification
election.
15. the Labor Secretary granted said motion and directed Milado to hold in abeyance any
and all certification election proceedings at the University pending the resolution of the
labor dispute.
16. the Divine Word University Independent Faculty and Employees Union (DWUIFEU),
which was registered earlier that day, filed a motion for intervention alleging that it had at
least 20% of the rank and file employees of the University.
ISSUES BEFORE SOLE:
(1) whether there was refusal to bargain and an impasse in bargaining;
(2) whether the complaints for unfair labor practices against each other filed by both
parties, including the legality of the strike with the NLRC, which later on was subsumed by
the assumption Order, are with merits;
(3) whether or not the certification election can be passed upon by this Office.
RULING:
1. a bargaining deadlock exists and as a matter of fact this is being conciliated by the
National Conciliation and Mediation Board at the time the University filed its Petition for
Certification Election on 10 May 1988.
the Union and the DWU have not been able to conclude a CBA since its certification on 6
September 1984 by then Med-Arbiter Bienvenido Elorcha. But the non-conclusion of a CBA
within one year, as in this case, does not automatically authorize the holding of a
certification election when it appears that a bargaining deadlock issue has been submitted
to conciliation by the certified bargaining agent.
2. The same Order dismissed not only the case filed by DWUEU-ALU for unfair labor
practice on the ground of the unions failure to prove the commission of the unfair labor
practice acts specifically complained of (NLRC Case No. 8-0321-88) but also the complaint
filed by the University for unfair labor practices and illegal strike for obvious lack of merit
brought about by its utter failure to submit evidence.
3. The Acting Secretary then concluded that for reneging on the agreement of May 10,
1988 and for its reluctance and subscription to legal delay, the University should
be declared in default. He also maintained that since under the circumstances the
University cannot claim deprivation of due process, the Office of the Secretary of Labor
may rightfully impose the Unions May 19, 1988 collective bargaining agreement proposals
motu proprio.

 On the Universitys contention that the motion for intervention of the DWU-IFEU was not
resolved, the Acting Secretary ruled that said motion was in effect denied when the petition
for certification election filed by the University was dismissed in the Order of May 23, 1989.
ISSUES BEFORE SC:
In the absence of a certified CBA , there having been no certification election held in
petitioner unit for more than five (5) years, WON a certification election is mandatory.

DOCTRINE:
If a collective bargaining agreement has been duly registered in accordance with Article
231 of the Code, a petition for certification election or a motion for intervention can only be
entertained within sixty (60) days prior to the expiry date of such agreement.
These provisions make it plain that in the absence of a collective bargaining agreement, an
employer who is requested to bargain collectively may file a petition for
certification election any time except upon a clear showing that one of these two
instances exists: (a) the petition is filed within one year from the date of issuance of a final
certification election result or (b) when a bargaining deadlock had been submitted to
conciliation or arbitration or had become the subject of a valid notice of strike or lockout.
RULING:
While there is no question that the petition for certification election was filed by the herein
petitioner after almost four years from the time of the certification election and, therefore,
there is no question as to the timeliness of the petition, the problem appears to lie in the
fact that the Secretary of Labor had found that a bargaining deadlock exists.
A deadlock is defined as the counteraction of things producing entire stoppage: a state
of inaction or of neutralization caused by the opposition of persons or of factions (as in
government or a voting body): standstill.[21] There is a deadlock when there is a
complete blocking or stoppage resulting from the action of equal and opposed
forces; as, the deadlock of a jury or legislature.[22] The word is synonymous with
the word impasse[23] which, within the meaning of the American federal labor laws,
presupposes reasonable effort at good faith bargaining which, despite noble intentions,
does not conclude in agreement between the parties.
A thorough study of the records reveals that there was no reasonable effort at good
faith bargaining specially on the part of the University. Its indifferent attitude
towards collective bargaining inevitably resulted in the failure of the parties to arrive at an
agreement. As it was evident that unilateral moves were being undertaken only by the
DWUEU-ALU, there was no counteraction of forces or an impasse to speak of.
The records do not show that during this three-year period, the union exerted any effort to
pursue collective bargaining as a means of attaining better terms of employment.

It was only after its affiliation with the ALU that the same union, through the ALU Director
for Operations, requested an initial conference for the purpose of collective bargaining
Be that as it may, the Court is not inclined to rule that there has been a deadlock or an
impasse in the collective bargaining process.
As the Court earlier observed, there has not been a reasonable effort at good faith
bargaining on the part of the University.
While DWUEU-ALU was opening all possible avenues for the conclusion of an agreement,
the record is replete with evidence on the Universitys reluctance and thinly disguised
refusal to bargain with the duly certified bargaining agent, such that the inescapable
conclusion is that the University evidently had no intention of bargaining with it.
Thus, while the Court recognizes that technically, the University has the right to file
the petition for certification election as there was no bargaining deadlock to
speak of, to grant its prayer that the herein assailed Orders be annulled would put an
unjustified premium on bad faith bargaining.
Kiok Loy vs. NLRC is applicable in the instant case considering that the facts therein have
also been indubitably established in this case. These factors are: (a) the union is the duly
certified bargaining agent; (b) it made a definite request to bargain and submitted its
collective bargaining proposals, and (c) the University made no counter proposal
whatsoever. As we said in Kiok Loy, [a] companys refusal to make counter proposal if
considered in relation to the entire bargaining process, may indicate bad faith and this is
especially true where the Unions request for a counter proposal is left unanswered.
That being the case, the petitioner may not validly assert that its consent should
be a primordial consideration in the bargaining process. By its acts, no less than its
inaction which bespeak its insincerity, it has forfeited whatever rights it could have
asserted as an employer.

G.R. No. 109002

April 12, 2000

DELA SALLE UNIVERSITY, petitioner,

vs.
DELA SALLE UNIVERSITY EMPLOYEES ASSOCIATION (DLSUEA) and BUENAVENTURA MAGSALIN,respondents.
x-----------------------x
G.R. No. 110072

April 12, 2000

DELA SALLE UNIVERSITY EMPLOYEES ASSOCIATION-NATIONAL FEDERATION OF TEACHERS AND

EMPLOYEES UNION (DLSUEA-NAFTEU), petitioner,
vs.
DELA SALLE UNIVERSITY and BUENAVENTURA MAGSALIN, respondents.

(1) whether the computer operators assigned at the University's Computer Services Center and the Universitys discipline
officers may be considered as confidential employees and should therefore be excluded from the bargaining unit which is
composed of rank and file employees of the University, and whether the employees of the College of St. Benilde should
also be included in the same bargaining unit;

The Court agrees with the Solicitor General that the express exclusion of the computer operators and discipline
officers from the bargaining unit of rank-and-file employees in the 1986 collective bargaining agreement does
not bar any re-negotiation for the future inclusion of the said employees in the bargaining unit. During the
freedom period, the parties may not only renew the existing collective bargaining agreement but may also
propose and discuss modifications or amendments thereto. With regard to the alleged confidential nature of
the said employees functions, after a careful consideration of the pleadings filed before this Court, we rule
that the said computer operators and discipline officers are not confidential employees. As carefully examined
by the Solicitor General, the service record of a computer operator reveals that his duties are basically clerical
and non-confidential in nature. Arbitrator that based on the nature of their duties, they are not confidential
employees and should therefore be included in the bargaining unit of rank-and-file employees.

The Court also affirms the findings of the voluntary arbitrator that the employees of the College of St. Benilde
should be excluded from the bargaining unit of the rank-and-file employees of Dela Salle University, because
the two educational institutions have their own separate juridical personality

(2) whether a union shop clause should be included in the parties collective bargaining agreement, in addition to the
existing maintenance of membership clause;

We affirm the ruling of the voluntary arbitrator for the inclusion of a union shop provision in addition to the
existing maintenance of membership clause in the collective bargaining agreement.

As the Solicitor General asserted in his consolidated Comment, the Universitys reliance on the case of
Victoriano vs. Elizalde Rope Workers Union clearly misplaced. In that case, we ruled that "the right to join a
union includes the right to abstain from joining any union.

The right to refrain from joining labor organizations recognized by Section 3 of the Industrial Peace Act is,
however, limited. The legal protection granted to such right to refrain from joining is withdrawn by operation of
law, where a labor union and an employer have agreed on a closed shop, by virtue of which the employer
may employ only members of the collective bargaining union, and the employees must continue to be
members of the union for the duration of the contract in order to keep their jobs.

(3) whether the denial of the Unions proposed "last-in-first-out" method of laying-off employees, is proper;

We agree with the voluntary arbitrator that as an exercise of management prerogative, the University has the
right to adopt valid and equitable grounds as basis for terminating or transferring employees. As we ruled in
the case of Autobus Workers' Union (AWU) and Ricardo Escanlar vs. National Labor Relations Commission,
management prerogative is one which, among others, covers: work assignment, working methods, time,
supervision of workers, transfer of employees, work supervision, is and the discipline, dismissaland recall of
workers. Except as provided for, or limited by special laws, an employer is free to regulate, according to his
own discretion and judgment, all aspects of employment."

(4) whether the ruling that on the basis of the University's proposed budget, the University can no longer be required to
grant a second round of wage increases for the school years 1991-92 and 1992-93 and charge the same to the
incremental proceeds, is correct;

On the fourth issue involving the voluntary arbitrators ruling that on the basis of the University's proposed
budget, the University can no longer be required to grant a second round of wage increases for the school
years 1991-92 and 1992-93 and charge the same to the incremental proceeds, we find that the voluntary
arbitrator committed grave abuse of discretion amounting to lack or excess of jurisdiction. As we ruled in the
case of Caltex Refinery Employees Association (CREA) vs. Jose S. Brillantes , [w]e believe that the standard
proof of a company's financial standing is its financial statements audited by independent external auditors
constitute the normal method of the normal method of proof of profit and loss performance of a company.

The financial capability of a company cannot be based on its proposed budget because a proposed budget does
not reflect the true financial condition of a company, unlike audited financial statements, and more importantly,
the use of a proposed budget as proof of a company's financial condition would be susceptible to abuse by
scheming employers who might be merely feigning dire financial condition in their business ventures in order
to avoid granting salary increases and fringe benefits to their employees.

(5) whether the denial of the Unions proposals on the deloading of the union president, improved leave benefits and
indefinite union leave with pay, is proper;

On the fifth issue involving the Unions proposals on the deloading of the union president, improved leave
benefits and indefinite union leave with pay, we agree with the voluntary arbitrators rejection of the said
demands, there being no justifiable reason for the granting of the same.

(6) whether the finding that the multi-sectoral committee in the University is the legitimate group which determines and
scrutinizes the annual salary increases and fringe benefits of the employees of the University, is correct; and

the Court finds that the voluntary arbitrator did not gravely abuse his discretion on this matter. From our reading
of the assailed decision, it appears that during the parties negotiations for a new collective bargaining
agreement, the Union demanded for a 25% and 40% salary increase for the second and third years,
respectively, of the collective bargaining agreement. The Universitys counter-proposal was for a 10%
increase for the third year .

After the meeting of the multi-sectoral committee on budget, which is composed of students, parents, faculty,
administration and union, the University granted across-the-board salary increases of 11.3% and 19% for the
second and third years, respectively.

While the voluntary arbitrator found that the said committee ". . . decided to grant the said increases based on
the University's viability which were exclusively sourced from the tuition fees. . . . . . . .," no finding was made
as to the basis of the committee's decision. Be that as it may, assuming for the sake of argument that the said
committee is the group responsible for determining wage increases and fringe benefits, as ruled by the
voluntary arbitrator, the committee's determination must still be based on duly audited financial statements
following our ruling on the fourth issue

(7) whether the ruling that the 70% share in the incremental tuition proceeds is the only source of salary increases and
fringe benefits of the employees, is proper.

On the seventh and last issue involving the ruling that the 70% share in the incremental tuition proceeds is the
only source of salary increases and fringe benefits of the employees, the Court deems that any determination
of this alleged error is unnecessary and irrelevant, in view of our rulings on the fourth and preceding issues
and there being no evidence presented before the voluntary arbitrator that the University held incremental
tuition fee proceeds from which any wage increase or fringe benefit may be satisfied.