G.R. No.

77231 May 31, 1989

SAN JOSE CITY ELECTRIC SERVICE COOPERATIVE, INC. (SAJELCO) vs.
MINISTRY OF LABOR AND EMPLOYMENT and MAGKAISA-ADLO

FACTS:
Manggagawang Nagkakaisa ng SAJELCO-Association of Democratic Labor Organization (MAGKAISAADLO) filed a petition for direct certification election (to certify the union). SAJELCO opposed the petition
contending that the employees who sought to be represented by private respondent are membersconsumers of the Cooperative itself and at the same time composed the General Assembly which,
pursuant to the By-laws is also the final arbiter of any dispute arising in the Cooperative. The Med-Arbiter
granted the petition, SAJELCO appealed to the Bureau of Labor Relations who dismissed appeal and
sustain the ruling of the Med-Arbiter. SAJELCO filed the instant petition for certiorari.

Four months after the SAJELCOs petition to the SC private respondent union said that they already
conducted certification election there being no restraining order from the SC enjoining the holding thereof
hence union claim that the certiorari petition has become moot and academic. [SC impliedly disregards
this opinion. Included only here kasi baka tanungin ni Judge.]
In the submission of comments, the Solicitor General opined that sided with SAJELCO with the following
reasons: 1. Union members are also cooperative members hence it will be inconsistent for union
members to bargain with themselves; 2. Cooperative members are in fact co-owners hence union runs
afoul with Art 243 of the Labor Code as union must have no involvement in the ownership of the firm; and
3. Cooperative members participate in the management of SAJELCO possessing the powers and
prerogatives of managerial employees who are not eligible to join, assist or form any labor organization.
ISSUE:
WON employees-members of an electric cooperative can organize themselves for purposes of collective
bargaining
HELD:
No but with some inhibitions (?!). SC had already decided on similar cases (Batangas I-Electric
Cooperative Labor Union vs. Romeo Young, et al., G.R. No. 62386, Bulacan II- Electric Cooperative, Inc.,
vs. Hon. Eliseo A. Penaflor, et al., G.R. No. 70880 and Albay Electric Cooperative vs. Crescencio B.
Trajano et. al., G.R. No. 74560 (November 9, 1988), citing the case of Cooperative Rural Bank of Davao
City, Inc. vs. Pura Ferrer-Calleja, G.R. No. 77951, September 26,1988) wherein members of a
cooperative cannot invoke the right to collective bargaining for certainly an owner cannot bargain with
himself or his co-owners. Nonetheless, cooperatives with employees who are not members or co-owners
thereof, certainly such employees are entitled to exercise the rights of all workers to organization,
collective bargaining, negotiations and others as are enshrined in the Constitution and existing laws of the
country.
At the case at bar, there are two types of employees under SAJELCO as per their by-laws, membersconsumers and the members of their immediate families. Members-consumers are not qualified to form,
join or assist labor organizations for purposes of collective bargaining. The reason for withholding from
employees of a cooperative who are members-co-owners the right to collective bargaining is clear: an
owner cannot bargain with himself. However, employees who are not members-consumers may form, join
or assist labor organizations for purposes of collective bargaining notwithstanding the fact that employees

of SAJELCO who are not members-consumers were employed ONLY because they are members of the
immediate family of members-consumers. The fact remains that they are not themselves membersconsumers, and as such, they are entitled to exercise the rights of all workers to organization, collective
bargaining, negotiations and others.
Petition is granted insofar as only the rank-and-file employees of petitioner who are not its membersconsumers are entitled to self-organization, collective bargaining, and negotiations, while other
employees who are members-consumers thereof cannot enjoy such right. The conducted certification
election was set aside.