Lori (pp.
79 129) - Not only must there be some evidence to
CHAPTER II
POWERS & DUTIES (CONTD)
(PART 3: PROCEDURE)
ART. 221. TECHNICAL RULES NOT BINDING & PRIOR
RESORT TO AMICABLE SETTLEMENT
In any proceeding before the Commission or any
of the Labor Arbiters, the rules of evidence prevailing in
courts of law or equity shall not be controlling and it is the
spirit and intention of this Code that the Commission and
its members and the Labor Arbiters shall use every and all
reasonable means to ascertain the facts in each case
speedily and objectively and without regard to
technicalities of law or procedure, all in the interest of due
process. In any proceeding before the Commission or any
Labor Arbiter, the parties may be represented by legal
counsel but it shall be the duty of the Chairman, any
Presiding Commissioner or Commissioner or any Labor
Arbiter to exercise complete control of the proceedings at
all stages.
Any provision of law to the contrary notwithstanding,
the Labor Arbiter shall exert all efforts towards the
amicable settlement of a labor dispute within his
jurisdiction on or before the first hearing. The same rule
shall apply to the Commission in the exercise of its original
jurisdiction. (As amended by Section 11, Republic Act No.
6715, March 21, 1989).
1. PROCEEDINGS BEFORE LABOR ARBITER OR
THE COMMISSION; TECHNICAL RULES NOT
APPLICABLE
- Administrative & quasi-judicial bodies, like the
NLRC, are not bound by the technical rules or
procedure in the adjudication of cases
- Simplification of procedure w/o sacrificing the
fundamental requisites of due process in
mandated to insure speedy administration of
justice
- Art 221 allows the NLRC or a labor arbiter to
decide a case on the basis of position papers &
other documents submitted w/o resorting to
technical rules of evidence as observed in the
regular courts of justice
Modicum of Admissibility; Substantial Evidence
- While the rules of evidence prevailing in the courts
of law or equity are not controlling in proceedings
before the NLRC, the evidence presented before it
must at least have a modicum of admissibility for it
to be given some probative value
support a finding or conclusion, but evidence
must be substantial
Substantial evidence
- such relevant evidence as a reasonable mind
might accept as adequate to support a
conclusion
Cardinal Rights in Quasi-Judicial Proceedings
- While the duty to deliberate does not impose the
obligation to decide rightly, it does imply a
necessity of having something to support the
decision
- A decision w/ absolutely nothing to support it is a
nullity when directly attacked
CASE: Ang Tibay v. CIR
Facts:
- This concerns the laying off of employees of Ang
Tibay belonging to the NLU, Inc.
Issue:
- Whether there was due process observed in the
CIR proceedings
Held:
- Although the CIR is not constrained by technical
rules of procedure. This does not mean that it
can entirely ignore the essential requirements of
due process in trials & investigations of an
administrative character
Cardinal rts w/c must be respected in administrative
proceedings: (HC SS RIK)
1) rt to a hearing;
2) tribunal must consider the evidence presented;
3) decision must be supported by something;
4) supporting evidence must be substantial;
5) decision must be rendered on the evidence
presented or at least contained in the record &
disclosed to the parties affected;
6) the administrative body or any of its judges must
act on his own independent consideration of the
law & facts, & not simply accept the views of the
subordinate in arriving at a decision; &
7) decide in such manner that parties can know the
various issues involved & the reason for the
decision
Verification
- A pleading is verified by an affidavit that the
affiant has read the pleading & that the
allegations therein are true & correct of his
knowledge & belief
1

Verification
- intended to assure that the allegations in the
pleading have been prepared in good faith or are
true & correct, not mere speculations
- Generally, lack of verification is merely a formal
defect that is neither jurisdictional nor fatal
Party respondent
- In a complaint for underpayment of wages & other
money claims filed by employees of a single
proprietorship business, the respondent should be
the business owner. This is not necessarily the
person in whose name the business is registered
CASE: Mayon Hotel & Restaurant v. Adana
Facts:
- Josefa Po, manager of Mayon Hotel, was held
liable for the employees money claims
eventhough the single proprietor business was
registered in the name of her daughter Pacita Po
- Petitioners insist that it was error for the Labor
Arbiter & the CA to have ruled that Josefa is the
owner since her participation was limited to merely
being the overseer
Ruling:
- The claim that Josefa Po is merely the overseer is
not borne out by the evidence
- Only Josefa appeared in the proceedings w/ the
Labor Arbiter. It was only on appeal w/ the NLRC
that Pacita signed the pleadings
- Josefa failed to submit the document of sale. It
was she who exercises all acts & manifestations of
ownership
- Notwithstanding the certificate of registration,
doubts were cast as to the true nature of Josefas
involvement in the enterprise, & the Labor Arbiter
had the authority to resolve this issue
- Even when the case was on appeal w/ the NLRC,
nothing was submitted to negate the Labor
Arbiters finding that Pacita is not the real owner of
the hotel
- There is substantial evidence to rule that Josefa is
the owner of the hotel
Prohibited Pleadings & Motions
The following pleadings and motions shall not be allowed
and acted upon nor elevated to the Commission: (Sec. 4,
Rule III, NLRC 2005 Rules of Procedure)
a) Motion to dismiss the complaint except on the
ground of lack of jurisdiction over the subject
matter, improper venue, res judicata, prescription
and forum shopping;
b) Motion for a bill of particulars;
c) Motion for new trial;
d) Petition for relief from judgment when filed with
the Labor Arbiter;
e) Petition for certiorari, mandamus or prohibition;
f) Motion to declare respondent in default;
g) Motion for reconsideration or appeal from any
interlocutory order of the Labor Arbiter.
2. MANDATORY CONCILIATION & MEDIATION
CONFERENCE; COMPROMISE
ENCOURAGED
Nature of Proceedings (Sec. 2, Rule V)
- The proceedings before the Labor Arbiter shall
be non-Iitigious in nature.
- Subject to the requirements of due process, the
technicalities of law and procedure and the rules
obtaining in the courts of law shall not strictly
apply thereto.
- The Labor Arbiter may avail himself of all
reasonable means to ascertain the facts of the
controversy speedily, including ocular inspection
and examination of well-informed persons.
Mandatory Conciliation & Mediation Conference (Sec. 3)
a) The mandatory conciliation and mediation
conference shall be called for the purpose of (1)
amicably settling the case upon a fair
compromise; (2) determining the real parties in
interest; (3) determining the necessity of
amending the complaint and including all causes
of action; (4) defining and simplifying the issues
in the case; (5) entering into admissions or
stipulations of facts; and (6) threshing out all
other preliminary matters.The Labor Arbiter shall
preside and take full control of the proceedings.
b) Conciliation and mediation efforts shall be
exerted by the Labor Arbiters all throughout the
proceedings.Should the parties arrive at any
agreement as to the whole or any part of the
dispute, the same shall be reduced to writing
and signed by the parties and their respective
counsel or authorized representative, if any,
before the Labor Arbiter.
c) In any case, the compromise agreement shall be
approved by the Labor Arbiter, if after explaining
to the parties, particularly to the complainants,
the terms, conditions and consequences thereof,
he is satisfied that they understand the
agreement, that the same was entered into
freely and voluntarily by them, and that it is not
contrary to law, morals, and public policy.
d) A compromise agreement duly entered into in
accordance with this Section shall be final and
binding upon the parties and shall have the force
and effect of a judgment rendered by the Labor
Arbiter.
2
 e) The mandatory conciliation and mediation
conference shall, except for justifiable grounds, be
terminated within thirty (30) calendar days from
the date of the first conference.
f) No motion for postponement shall be entertained
except on meritorious grounds.
Effect of failure of conciliation & mediation (Sec. 4)
- Should the parties fail to agree upon an amicable
settlement, either in whole or in part, during the
mandatory conciliation and mediation conference,
the Labor Arbiter shall terminate the conciliation
and mediation stage and proceed to pursue the
other purposes of the said conference as
enumerated in the immediately preceding Section.
- Thereafter, the Labor Arbiter shall direct the
parties to simultaneously file their respective
position papers on the issues agreed upon by the
parties and as reflected in the minutes of the
proceedings.
Non-appearance of parties (Sec. 5)
- The non-appearance of the complainant or
petitioner during the two (2) settings for mandatory
conciliation and mediation conference scheduled
in the summons, despite due notice thereof, shall
be a ground for the dismissal of the case without
prejudice.
- In case of non-appearance by the respondent
during the first scheduled conference, the second
conference shall proceed as scheduled in the
summons.
- If the respondent still fails to appear at the second
conference despite being duly served with
summons, the Labor Arbiter shall immediately
terminate the mandatory conciliation and
mediation conference.
- The Labor Arbiter shall thereafter allow the
complainant or petitioner to file his verified position
paper and submit evidence in support of his
causes of action, and thereupon render his
decision on the basis of the evidence on record.
It is incumbent upon the Labor Arbiter not only to persuade
the parties to settle amicably, but equally to ensure that the
compromise agreement entered into by them is a fair one
& that the same was agreed upon freely, voluntarily, & w/ a
full understanding of the terms & conditions as well as the
consequences
Art. 222 LC, allows non-lawyers to appear before the labor
tribunal in representation of their own selves
Binding Effect of Compromise Agreement
- A judgment on a compromise agreement puts an
end to a litigation & is immediately executory
- However, a special authority is required before
an atty can compromise the litigation of his
clients
- Attorneys and other representatives of parties
shall have authority to bind their clients in all
matters of procedure; but they cannot, without a
special power of attorney or express consent,
enter into a compromise agreement with the
opposing party in full or partial discharge of a
client's claim. (Sec. 9, Rule III, NLRC RRP)
- The Labor Arbiters approval of a compromise
agreement is required over a case pending
before the Labor Arbiter
CASE: General Rubber & Footwear Corp. v. Drilon
Facts:
- Some members of the Union declared a strike
against Gen. Rubber, demanding the differential
pay arising from a wage order increasing the
minimum wage rate. Gen. Rubber & Sto.
Domingo, purporting to represent the striking
workers, entered into a return-to-work
agreement, where the Union agreed not to
demand the differential pay. Majority members
of the Union ratified the document.
Issue:
- Is the waiver agreement binding upon all the
members of the union, even those who did not
sign it?
Ruling:
- No. Minority members cannot be bound by the
return-to-work agreement
- The waiver of the money claims is a personal rt.
For a waiver thereof to be legally effective, the
individual consent or ratification of the
employees involved must be shown
Quitclaim & Waivers
CASE: Olacao v. NLRC
Facts:
- The employees filed a complaint for unpaid
wages against their employer. Based on
Receipts & Release documents, the Labor
Arbiter dismissed the complaint. The
documents, signed by each of the complainants,
showed that they received full & final payment of
their wages & other claims & that they forever
released respondents & its successors of any
claims & liabilities.
- The ff yr, an illegal dismissal complaint was filed.
The Labor Arbiter dismissed the charge but
ordered the company to pay separation pay.
- NLRC reversed the Labor Arbiter, saying that the
3
 issue of termination pay was already resolved in
the previous case & was barred by prior judgment
Ruling:
- NLRC correct. Decision in the Unpaid Wages
Case legally & finally settled the question of
separation pay of petitioners
- Causes of action are the same. In essence, bec
petitioners claimed that they had been illegally
dismissed, they prayed for backwages from the
date of illegal dismissal
- Jurisprudence exists to the effect that a deed of
release or quitclaim cannot bar an employee from
demanding benefits to w/c he is legally entitled;
that quitclaims &/or complete releases executed
by the employees do not estop them from
pursuing their claim arising from the ULP of the
employer; & that employees who received their
separation pay are not barred from contesting the
legality of their dismissal, & that acceptance of
those benefits would not amount to estoppel
- However, in the present case, the issue of validity
of the releases, executed by petitioners under
oath, was squarely raised & resolved in the
Decision in the Unpaid Wages Case w/c found
categorically that the document forever released
the employer & its successors & assigns of any &
all claims & liabilities including termination pay
2.2a Final & Executory Judgment Cannot be
Negotiated
- Although compromise agreements are
encouraged, this general rule does not apply to
decisions that have become final & executory
- A final & executory judgment cannot be
negotiated, hence, any act to subvert it is
contemptuous
- Disrespect for the administration of justice should
not be sanctioned
3. MOTION TO DISMISS (Sec. 6, Rule V, NLRC
RRP)
- On or before the date set for the mandatory
conciliation and mediation conference, the
respondent may file a motion to dismiss.
- Any motion to dismiss on the ground of lack of
jurisdiction, improper venue, or that the cause of
action is barred by prior judgment, prescription, or
forum shopping, shall be immediately resolved by
the Labor Arbiter through a written order.
- An order denying the motion to dismiss, or
suspending its resolution until the final
determination of the case, is not appealable.
Motu Propio Dismissal of Complaint Based on
Prescription
- The rule on waiver of defenses by failure to
plead in the answer or motion to dismiss does
not apply when the plaintiffs own allegations in
the complaint shows clearly that the action has
prescribed
- In such a case, the court may motu propio
dismiss the case, on the ground of prescription
- Even assuming that the employers motion to
dismiss was filed out of time, there was nothing
to prevent the labor arbiter from dismissing the
complaint on the ground of prescription (cause
of action, dismissal, accrued in 1979; complaint
filed in 1984)
Res Judicata as Reason to Dismiss Complaint
CASE: Delfin v. Inciong
Rulings:
- Requisites for prior judgment to constitute a bar
to a subsequent case:
a. It must be a final judgment or order;
b. The court rendering the same must
have jurisdiction over the subject matter
& over the parties;
c. It must be a judgment or order on the
merits; &
d. There must be between the 2 cases,
identity of parties, subject matter, &
cause of action
- When a labor union accuses an employer of
acts of ULP allegedly committed during a given
period of time, the charges should include all
acts of ULP committed against any & all
members of the union during that period
- The union should not, upon dismissal of the
charges first proferred, be allowed to split its
cause of action & harass the employer w/
subsequent charges based upon acts committed
during the same period of time
No Dismissal of Complaint Despite Death
- A case for reinstatement of the dismissed
employees is not extinguished bec of the death
of the proprietor
- It was not a money claim, not to say it involved
purely employer-employee relationship, w/c falls
under the exclusive authority of the labor officials
to hear & resolve
- While it combined a claim for backwages & the
like, the entitlement of individual employees
thereto solely depended on their rt to
reinstatement
- The case falls under the jurisdiction of the NLRC
4
 & not the civil courts
Revival or Refiling of Dismissed Case
- A dismissed case is not necessarily dead
- A party may file a motion to revive or re-open a
case dismissed without prejudice, within ten (10)
calendar days from receipt of notice of the order
dismissing the same; otherwise, his only remedy
shall be to re-file the case in the arbitration branch
of origin.
Dismissed w/o prejudice
- a tentative or temporary dismissal
- the complaint may be revived through an
appropriate action
4. SUBMISSION OF POSITION PAPERS & REPLY
Determination of Necessity of Hearing or Clarificatory
Conference
- Immediately after the submission by the parties of
their position paper or reply, as the case may be,
the Labor Arbiter shall, motu proprio, determine
whether there is a need for a hearing or
clarificatory conference.At this stage, he may, at
his discretion and for the purpose of making such
determination, ask clarificatory questions to further
elicit facts or information, including but not limited
to the subpoena of relevant documentary
evidence, if any, from any party or witness. (Sec 8,
Rule V)
Role of the Labor Arbiter in hearing & clarificatory
conference
a) The Labor Arbiter shall take full control and
personally conduct the hearing or clarificatory
conference. Unless otherwise provided by law, the
Labor Arbiter shall determine the order of
presentation of evidence by the parties, subject to
the requirements of due process. He shall
examine the parties and their witnesses with
respect to the matters at issue; and ask questions
only for the purpose of clarifying points of law or
fact involved in the case. He shall limit the
presentation of evidence to matters relevant to the
issue before him and necessary for a just and
speedy disposition of the case.
b) In the cross-examination of witnesses, only
relevant, pertinent and material questions
necessary to enlighten the Labor Arbiter shall be
allowed.
c) The Labor Arbiter shall make a written summary of
the proceedings, including the substance of the
evidence presented, in consultation with the
parties. The written summary shall be signed by
the parties and shall form part of the records.
(Sec 9)
Non-appearance of Parties; Postponement of
Hearing & Clarificatory Conferences
a) Non-appearance at a hearing or clarificatory
conference by the complainant or petitioner, who
was duly notified thereof, may be sufficient
cause to dismiss the case without
prejudice.Subject to Section 16 of this Rule,
where proper justification is shown by proper
motion to warrant the re-opening of the case, the
Labor Arbiter shall call another hearing or
clarificatory conference and continue the
proceedings until the case is finally decided.The
dismissal of the case for the second time due to
the unjustified non-appearance of the
complainant or petitioner, who was duly notified
of the clarificatory hearing, shall be with
prejudice.
b) In case the respondent fails to appear during the
hearing or clarificatory conference despite due
notice thereof, the complainant shall be allowed
to present evidence ex-parte, without prejudice
to cross-examination at the next hearing or
conference.Two (2) successive non-
appearances by the respondent during his
scheduled presentation of evidence or
opportunity to cross-examine witnesses, despite
due notice thereof, shall be construed as a
waiver on his part to present evidence or
conduct cross-examination.
c) The parties and their counsels appearing before
the Labor Arbiter shall be prepared for
continuous hearing or clarificatory
conference.No postponement or continuance
shall be allowed by the Labor Arbiter, except
upon meritorious grounds and subject always to
the requirement of expeditious disposition of
cases.In any case, the hearing or clarificatory
conference shall be terminated within ninety (90)
calendar days from the date of the initial hearing
or conference.
d) Paragraph (c) of this Section notwithstanding, in
cases involving overseas Filipino workers, the
aggregate period for conducting the mandatory
conciliation and mediation conference, including
hearing on the merits or clarificatory conference,
shall not exceed sixty (60) days, which shall be
reckoned from the date of acquisition of
jurisdiction by the Labor Arbiter over the person
of the respondents. (Sec. 10)
5. SUBMISSION OF THE CASE FOR DECISION
Upon the submission by the parties of their position
papers or replies, or the lapse of the period to submit the
same, the case shall be deemed submitted for decision
5
unless the Labor Arbiter calls for a hearing or clarificatory
conference in accordance with Section 8 of this Rule, in
which case, notice of hearing or clarificatory conference
shall be immediately sent to the parties.Upon termination
of the said hearing or conference, the case shall be
deemed submitted for decision. (Sec 11)
Position Papers as Basis of Decision
- The procedure by w/c issues are resolved based
only on position papers, affidavits or documentary
evidence, if agreed upon by the parties, may be
availed of by the arbiter
- The Labor Arbiter may choose, if he deems it
necessary, to set the case for hearing on the
merits where witnesses may be presented &
examined by the parties
- In both instances, the burden of proving that the
termination was for valid or authorized cause rests
on the employer
Lack of Verification, Not Fatal
- The lack of verification of the position paper-
affidavit is a formal defect w/c could easily be
corrected by requiring an oath
- A pleading w/c is required by the ROC to be
verified may be given due course even w/o a
certification if the circumstances warrant the
suspension of the rules in the interest of justice
Due Process: Opportunity To Be Heard
- Procedural due process means that a party to a
case must be given sufficient opportunity to be
heard. Its very essence is to allow all parties
opportunity to present evidence
- There is no denial of due process where the
employer was duly represented by counsel &
given sufficient opportunity to be heard & present
his evidence, nor where the employers failure to
be heard was due to the various postponements
granted to it or to his repeated failure to appear
during hearings
Inhibition
- A Labor Arbiter may voluntarily inhibit himself from
the resolution of a case and shall so state in
writing the legal justifications therefor.Upon motion
of a party, either on the ground of relationship
within the fourth civil degree of consanguinity or
affinity with the adverse party or counsel, or on
question of impartiality, the Labor Arbiter may
inhibit himself from further hearing and deciding
the case.Such motion shall be resolved within five
(5) days from the filing thereof.An order denying or
granting a motion for inhibition is inappealable.
(Sec 12)
Due Process Includes Impartiality of the Appeal
Body
Administrative due process also includes: (Ang Tibay)
(a) the rt to notice, be it actual or constructive, of the
institution of the proceedings that may affect a
persons legal rt;
(b) reasonable opportunity to appear & defend his
rts & to introduce witnesses & relevant evidence
in his favor;
(c) a tribunal so constituted as to give him
reasonable assurance of honesty & impartiality,
& one of competent jurisdiction; &
(d) a finding or decision by that tribunal supported
by substantial evidence presented at the hearing
or at least ascertained in the records or
disclosed to the parties
- The reviewing officer must perforce be other
than the officer whose decision is under review
6. SUSPENSION OF PROCEEDINGS
CASE: Rubberworld v. NLRC
- Consequent to the appointment by the SEC of a
receiver or a management committee tasked w/
the rehabilitation of the corporation, all pending
actions for claims or other labor cases against
such corporation shall be suspended
accordingly
- To allow labor cases to proceed would be
detrimental to the primary duty of the
management committee to work towards
rehabilitating the corporation & make it viable
again
- The purpose of rehabilitation proceedings is to
enable the company to gain a new lease on life
& thereby allow creditors to be paid their claims
from its earnings
- In insolvency proceedings, the company stops
operating & the claims of creditors are satisfied
from the assets of the insolvent corporation
- The preference of credit granted to workers
under Art 110 LC is not applicable in
rehabilitation proceedings
7. FILING & SERVICE OF PLEADINGS &
DECISIONS
- All pleadings in connection with the case shall
be filed with the appropriate docketing unit of the
Regional Arbitration Branch or the Commission,
as the case maybe.
The party filing the pleadings shall serve the
opposing parties with a copy thereof and its
supporting documents in the manner provided
6
 for in these Rules with proof of service thereof.
(Sec 5, Rule III)
Service of Notice & Resolutions
a) Notices or summons and copies of orders, shall be
served on the parties to the case personally by the
Bailiff or duly authorized public officer within three
(3) days from receipt thereof or by registered mail;
Provided that in special circumstances, service of
summons may be effected in accordance with the
pertinent provisions of the Rules of Court;
Provided further, that in cases of decisions and
final awards, copies thereof shall be served on
both parties and their counsel or representative by
registered mail; Provided further that in cases
where a party to a case or his counsel on record
personally seeks service of the decision upon
inquiry thereon, service to said party shall be
deemed effected upon actual receipt thereof;
Provided finally, that where parties are so
numerous, service shall be made on counsel and
upon such number of complainants, as may be
practicable, which shall be considered substantial
compliance with Article 224 (a) of the Labor Code,
as amended.
For purposes of appeal, the period shall be
counted from receipt of such decisions,
resolutions, or orders by the counsel or
representative of record.
b) The Bailiff or officer serving the notice, order,
resolution or decision shall submit his return within
two (2) days from date of service thereof, stating
legibly in his return his name, the names of the
persons served and the date of receipt, which
return shall be immediately attached and shall
form part of the records of the case.In case of
service by registered mail, the Bailiff or officer shall
write in the return, the names of persons served
and the date of mailing of the resolution or
decision.If no service was effected, the service
officer shall state the reason therefor in the return.
(Sec. 6, Rule III)
Proof & Completeness of Service
- The return is prima facie proof of the facts
indicated therein.Service by registered mail is
complete upon receipt by the addressee or his
agent; but if the addressee fails to claim his mail
from the post office within five (5) days from the
date of first notice of the postmaster, service shall
take effect after such time.
- Service of the papers may be made by delivering
personally a copy to the party or his counsel, or by
leaving it in his office with his clerk or with a
person having charge thereof. If no person is
found in his office, or his office is not known, or he
has no office, then by leaving the copy, between
the hours of eight in the morning and six in the
evening, at the party's or counsel's residence, if
known, with a person of sufficient age and
discretion then residing therein. (Rule 13, ROC)
- The ROC applies suppletorily to the Rules of the
NLRC in the absence of specific provisions on
the service of decisions or orders
- In the absence of any showing that such
practice (serving a copy of the decision not by
official process servers but by authorized union
officials to the employer) is sanctioned by the
implementing rules of the NLRC or by the ROC,
the party who takes advantage of such irregular
practice does so at its own risk & cannot be later
heard to complain
- Where the copy of the decision is served on a
person who is neither a clerk or one in charge of
the attys office, such service is invalid & the
decision does not therefore become executory
8. RESOLUTION OF DOUBT IN LAR OR
EVIDENCE
- Doubt as to the interpretation of labor laws &
regulations has to be resolved in favor of labor
- This precept extends to doubts about the
evidence of the disputants
CASE: Nicario v. NLRC
Facts:
- Petitioner employee claimed that she worked 12
hrs a day, thus rendering OT work for w/c she
claimed OT pay. The labor arbiter, taking notice
of the fact that the establishment is open for 12
hrs, decided in favor of petitioner. On motion for
reconsideration filed by the employer w/ the
NLRC, the decision was modified based on the
daily time records presented by the employer
showing that there was no OT work
Ruling:
- The DTR are unreliable since the originals
thereof were not presented in evidence
- No noon break is observed but the DTR shows
petitioner has a rest period from 12n 2pm
- All entries in the DTR are suspiciously
inconsistent
- In controversies between a laborer & his master,
doubts reasonably arising from the evidence, or
in the interpretation of agreements & writing
should be resolved in the formers favor
7

9. DECISION OF LABOR ARBITER
- The Labor Arbiter shall render his decision within
thirty (30) calendar days, without extension, after
the submission of the case by the parties for
decision, even in the absence of stenographic
notes; Provided however, that cases involving
overseas Filipino workers shall be decided within
ninety (90) calendar days after the filing of the
complaint which shall commence to run upon
acquisition by the Labor Arbiter of jurisdiction over
the respondents. (Sec 13, Rule V, NLRC RRP)
Contents of Decisions
- The decisions and orders of the Labor Arbiter shall
be clear and concise and shall include a brief
statement of the: a) facts of the case; b) issues
involved; c) applicable laws or rules; d)
conclusions and the reasons therefor; and e)
specific remedy or relief granted.In cases involving
monetary awards, the decisions or orders of the
Labor Arbiter shall contain the amount awarded.
- In case the decision of the Labor Arbiter includes
an order of reinstatement, it shall likewise contain:
a) a statement that the reinstatement aspect is
immediately executory; and b) a directive for the
employer to submit a report of compliance within
ten (10) calendar days from receipt of the said
decision. (Sec 14, Rule V)
No Motions for Reconsideration & Petitions for Relief
from Judgment
- No motions for reconsideration or petitions for
relief from judgment of any decision, resolution or
order of a Labor Arbiter shall be allowed.However,
when one such motion for reconsideration is filed,
it shall be treated as an appeal provided that it
complies with the requirements for perfecting an
appeal.In the case of a petition for relief from
judgment, the Labor Arbiter shall elevate the case
to the Commission for disposition. (Sec 15, Rule
V)
NOT AUTOMATICALLY IN FAVOR OF LABOR
- The law in protecting the rts of the laborer
authorizes neither oppression nor self-destruction
of the employer. More importantly, while the
Constitution is committed to the policy of social
justice & the protection of the working class, it
should not be supposed that every labor dispute
will automatically be decided in favor of labor (Mkti
Haberdashery v. NLRC/ Mla Electric Co. v. NLRC)
ART. 222. APPEARANCES & FEES
(a) Non-lawyers may appear before the
Commission or any Labor Arbiter only:
1. If they represent themselves; or
2. If they represent their organization or
members thereof.
(b) No attorneys fees, negotiation fees or similar
charges of any kind arising from any collective
bargaining agreement shall be imposed on any
individual member of the contracting union: Provided,
However, that attorneys fees may be charged against
union funds in an amount to be agreed upon by the
parties. Any contract, agreement or arrangement of any
sort to the contrary shall be null and void. (As amended
by Presidential Decree No. 1691, May 1, 1980).
1. APPEARANCE OF NON-LAWYERS
Under the NLRC Rules of 2005, a non-lawyer may
appear before the Commission or Labor Arbiter only if:
(1) he represents himself as party to the case;
(2) he represents a legitimate labor organization, as
defined under Article 212 and 242 of the Labor
Code, as amended, which is a party to the case:
Provided, that he presents: (i) a certification from
the Bureau of Labor Relations (BLR) or Regional
Office of the Department of Labor and
Employment attesting that the organization he
represents is duly registered and listed in the
roster of legitimate labor organizations; (ii) a
verified certification issued by the secretary and
attested to by the president of the said
organization stating that he is authorized to
represent the said organization in the said case;
and (iii) a copy of the resolution of the board of
directors of the said organization granting him
such authority;
(3) he represents a member or members of a
legitimate labor organization that is existing
within the employer's establishment, who are
parties to the case: Provided, that he presents:
(i) a verified certification attesting that he is
authorized by such member or members to
represent them in the case; and (ii) a verified
certification issued by the secretary and attested
to by the president of the said organization
stating that the person or persons he is
representing are members of their organization
which is existing in the employer's
establishment;
(4) he is a duly-accredited member of any legal aid
office recognized by the Department of Justice
or Integrated Bar of the Philippines: Provided,
that he (i) presents proof of his accreditation;
and (ii) represents a party to the case;
(5) he is the owner or president of a corporation or
establishment which is a party to the case:
8
 Provided, that he presents: (i) a verified
certification attesting that he is authorized to
represent said corporation or establishment; and
(ii) a copy of the resolution of the board of
directors of said corporation, or other similar
resolution or instrument issued by said
establishment, granting him such authority. (Sec
8b, Rule III)
- The appearance of labor federations & local
unions as counsel in labor proceedings has been
given legal sanction under Art 222 LC
2. CHANGE OF LAWYER
No substitution of atty will be allowed unless the ff
requisites concur:
(1) there must be filed a written application for
substitution;
(2) there must be filed the written consent of the client
to the substitution;
(3) there must be filed the written consent of the atty
to be substituted, is such consent can be obtained;
& respective shares in the fee to be paid the atty
(4) in case such written consent cannot be procured,
there must be filed w/ the application for
substitution, proof of the service of notice of such
motion in the manner required by the rules, on the
atty to be substituted
- There can be no valid substitution of counsel until
the prescribed procedure is followed
- Any change or withdrawal of counsel or
representative shall be made in accordance with
the Rules of Court. (Sec 8, Rule III)
3. AUTHORITY TO BIND PARTY
Attorneys and other representatives of parties shall have
authority to bind their clients in all matters of procedure;
but they cannot, without a special power of attorney or
express consent, enter into a compromise agreement with
the opposing party in full or partial discharge of a client's
claim. (Sec 9, Rule III)
CASE: Kanlaon Construction Enterprises Co., Inc. v.
NLRC
Facts:
- Laborers of a construction company filed claims
against respondent company & the 2 engineers
who were project managers where the claimants
worked. The engineers, both non-lawyers,
admitted the companys liability & agreed to pay
the money claims. They also waived the
companys rt to file position papers. The company
refused to pay as directed by the arbiter since the
engineers had no authority to represent & bind
the corporation
Ruling:
- The appearance of the engineers on behalf of
the company required written proof of
authorization w/c they did not have. It was
incumbent upon the labor arbiters to ascertain
this authority especially since both engineers
were named co-respondents
- A promise to pay amounts to an offer to
compromise & requires a special power of atty
or the express consent of petitioner
4. ATTORNEYS FEE
- Art 222 prohibits the payment of AF only when it
is effected through forced contributions from the
workers from their own funds as distinguished
from the union funds
- Purpose is to prevent imposition on the workers
of the duty to individually contribute their
for his services on behalf of the union in its
negotiations w/ the management
- The obligation to pay the AF belongs to the
union & cannot be shunted to the workers as
their direct responsibility
- Any agreement to the contrary shall be null &
void ab initio
Negotiation Fee
- The 10% negotiation fee w/c covers AF, agency
fee, & the like is based on the amount of
backwages receivable under the CBA w/c is
beyond what the law grants
CASE: Cebu Institute of Technology (CIT) v. Ople
Facts:
- The court awarded 10% of the backwages
payable to all members of the bargaining unit as
negotiation fee w/c covers AF, agency fee & the
like. Only members of the bargaining unit
should be made to pay this assessment
- Employer school contends that the nego fee of
10% should not be charged against the 60%
incremental proceeds from tuition fee increases
on the ground that this is not a bargainable
matter as it has already been fixed by law;
hence, only 30% should be subject to the
computation of the 10% nego fee
- The faculty association asserts that the whole
90% incremental proceeds from TF increases
should be the basis for computing the 10% nego
fee. It alleged that were it not for the demand
made by the union & subsequent notice of strike
9
 that ensued arising from the nonimplementation of
PD 451, the school would not grant the benefits
thereunder
Ruling:
- The school is correct
- The whole 90% economic package awarded by
the NLRC cannot be the basis for computing the
negotiation fees as the law has already provided
for the minimum percentage of TF increases to be
allotted for teachers & other school personnel.
This is mandatory & cannot be diminished
although it may be increased by collective
bargaining
- Only the amt beyond that mandated by law should
be subject to nego fees & AF since it is only this
w/c the employees had to bargain for
- The 60% w/c the law grants is not a negotiable
issue & not obtained by negotiation
For Services Rendered by Union Officers
- Art 222b prohibits the imposition on any individual
union member of AF, nego fees & similar charges
arising from negotiation of a bargaining agreement
- The collection of the special assessment partly for
the payment of services rendered by union
officers, consultants & others may not be in the
category of AF or nego fees, but is an exaction w/c
falls w/in the category of similar charge, &
therefore, w/in the coverage of the prohibition
- The manner of imposition of AF & nego fee should
be correlated w/ Art 241 (n & o), Art 239 (h), & Art
249 (e)
Attorneys Fee Collectible Only from Union Funds
- Art 222b allows AF to be charged against union
funds
- The economic benefits granted by a newly
concluded CBA do not constitute union funds
when the employees have not received them yet
CHAPTER III
APPEAL
ART. 223. APPEAL
Decisions, awards, or orders of the Labor Arbiter
are final and executory unless appealed to the
Commission by any or both parties within ten (10)
calendar days from receipt of such decisions, awards, or
orders. Such appeal may be entertained only on any of
the following grounds:
(a) If there is prima facie evidence of abuse of
discretion on the part of the Labor Arbiter;
(b) If the decision, order or award was secured
through fraud or coercion, including graft and corruption;
(c) If made purely on questions of law; and
(d) If serious errors in the findings of facts are
raised which would cause grave or irreparable damage
or injury to the appellant.
In case of a judgment involving a monetary
award, an appeal by the employer may be perfected
only upon the posting of a cash or surety bond issued by
a reputable bonding company duly accredited by the
Commission in the amount equivalent to the monetary
award in the judgment appealed from.
In any event, the decision of the Labor Arbiter
reinstating a dismissed or separated employee, insofar
as the reinstatement aspect is concerned, shall
immediately be executory, even pending appeal. The
employee shall either be admitted back to work under
the same terms and conditions prevailing prior to his
dismissal or separation or, at the option of the employer,
merely reinstated in the payroll. The posting of a bond
by the employer shall not stay the execution for
reinstatement provided herein.
To discourage frivolous or dilatory appeals, the
Commission or the Labor Arbiter shall impose
reasonable penalty, including fines or censures, upon
the erring parties.
In all cases, the appellant shall furnish a copy of
the memorandum of appeal to the other party who shall
file an answer not later than ten (10) calendar days from
receipt thereof.
The Commission shall decide all cases within
twenty (20) calendar days from receipt of the answer of
the appellee. The decision of the Commission shall be
final and executory after ten (10) calendar days from
receipt thereof by the parties.
Any law enforcement agency may be deputized by
the Secretary of Labor and Employment or the
Commission in the enforcement of decisions, awards or
orders. (As amended by Section 12, Republic Act No.
6715, March 21, 1989).
1. NO MOTION FOR RECONSIDERATION OF
LABOR ARBITERS DECISION
- If any of the grounds exist, the losing party may
appeal
- The NLRC Rules of 2005 does not allow a
motion for reconsideration of a labor arbiters
decision
10
 - SECTION 15. MOTIONS FOR
RECONSIDERATION/PETITION FOR RELIEF
FROM JUDGMENT. - No motions for
reconsideration/petition for relief from judgment of
any decision, resolution or order of a Labor Arbiter
shall be allowed. However, when one such motion
for reconsideration is filed, it shall be treated as an
appeal provided that it complies with the
requirements for perfecting an appeal. In the case
of a petition for relief from judgment, the Labor
Arbiter shall elevate the case to the Commission
for disposition.
- NLRC decision may be elevated to the CA but a
motion for reconsideration must first be filed
Final Decisions Cannot Be Amended
- If not appealed on time, the LAs decision
becomes final & cannot be amended
- The perfection of an appeal w/in the reglementary
period is not only mandatory but also jurisdictional
- Except for correction of clerical errors, or the
making of a nunc pro tunc (a ruling w/c applies
retroactively to correct an earlier ruling; now for
then) entries w/c cause no prejudice to any party,
or where the judgment is void, after the judgment
has become final & executory, the same can
neither be amended nor altered even if the
purpose is to correct a perceived conclusion of
fact or of law
2. PERIOD TO APPEAL FROM LA
Ten Calendar Days
- The 10-day period refers to 10 calendar days &
not to 10 working days (Vir-Jen Shipping & Marine
Services v. NLRC)
- Saturdays, Sundays are Legal Holidays are
included
- This is in line w/ the objective of the law for speedy
disposition of labor cases w/ the end in view of
protecting the interests of the working men
10-Calendar-Day Rule Not Applicable Prior to Vir-Jen
Case
- cannot be applied to a case where the appeal to
the NLRC was filed prior to the promulgation of the
SCs decision in the Vir-jen case on July 20, 1982
Under the 2005 NLRC Rules of Procedure
- Decisions, resolutions or orders of the Labor
Arbiter shall be final and executory unless
appealed to the Commission by any or both
parties within ten (10) calendar days from receipt
of such decisions, resolutions or orders of the
Labor Arbiter and in case of a decision of the
Regional Director within five (5) calendar days
from receipt of such decisions, resolutions, or
orders. If the 10th or 5th day, as the case may
be, falls on a Saturday, Sunday or a holiday, the
last day to perfect the appeal shall be the next
working day (Sec 1, Rule VI)
Date of Receipt by Mail
- Service by registered mail is complete either
upon actual receipt by the addressee or at the
end of 5 days, if he does not claim it w/in 5 days
from the 1st notice of the postmaster
- Purpose is to place the date of receipt of
pleadings, judgments & processes beyond the
power of the party being served to determine at
his pleasure
Failure to Give Copy of Appeal to Adverse Party W/in
10 Days
- not fatal if the appellee was not prejudiced by
the delay in the service of said copy of the
appeal
- The dismissal of an employees appeal on a
purely technical ground is inconsistent w/ the
constitutional mandate on protection to labor
No Extension of Period
- No motion or request for extension of the period
w/in w/c to perfect an appeal shall be allowed
Periods Generally Mandatory
- Only strong consideration of equity will lead the
SC to allow an exception to the procedural rule
in the interest of substantial justice
- It is precisely in the interest of labor that the law
has commanded that labor cases be promptly if
not peremptorily disposed of
3. GROUNDS OF APPEAL
- The appeal may be entertained only on any of
the following grounds:
(a) If there is prima facie evidence of abuse of
discretion on the part of the Labor Arbiter or
Regional Director;
(b) If the decision, resolution or order was
secured through fraud or coercion, including
11
 graft and corruption;
(c) If made purely on questions of law; and/or
(d) If serious errors in the findings of facts are
raised which, if not corrected, would cause grave
or irreparable damage or injury to the appellant.
(Sec 2, Rule VI)
4. WHERE TO FILE APPEAL
- Regional Arbitration Branch or Regional Ofc where
the case was heard & decided
5. REQUISITES FOR PERFECTION OF APPEAL
a) The appeal shall be:
1) filed within the reglementary period provided in
Section 1 of this Rule;
2) verified by the appellant himself in accordance
with Section 4, Rule 7 of the Rules of Court, as
amended;
3) in the form of a memorandum of appeal which
shall state the grounds relied upon and the
arguments in support thereof, the relief prayed for,
and with a statement of the date the appellant
received the appealed decision, resolution or
order;
4) in three (3) legibly typewritten or printed copies;
and
5) accompanied by
i) proof of payment of the required appeal
fee;
ii) posting of a cash or surety bond as
provided in Section 6 of this Rule;
iii) a certificate of non-forum shopping; and
iv) proof of service upon the other parties.
b) A mere notice of appeal without complying with the
other requisites aforestated shall not stop the running of
the period for perfecting an appeal.
c) The appellee may file with the Regional Arbitration
Branch or Regional Office where the appeal was filed, his
answer or reply to appellant's memorandum of appeal, not
later than ten (10) calendar days from receipt
thereof.Failure on the part of the appellee who was
properly furnished with a copy of the appeal to file his
answer or reply within the said period may be construed as
a waiver on his part to file the same.
d) Subject to the provisions of Article 218 of the Labor
Code, once the appeal is perfected in accordance with
these Rules, the Commission shall limit itself to
reviewing and deciding only the specific issues that were
elevated on appeal. (Sec 4, Rule 6)
6. FRIVOLOUS APPEAL
- Not only the Commission but also the LA is
empowered to impose reasonable penalties
upon a party for filing a frivolous appeal
- Even when appeal is still w/ the LA, & not yet
transmitted to the Commission, the former may
already find it frivolous &, there & then,
terminate the appeal
Unverified Letter Not Proper Appeal
CASE: Garcia v. NLRC
- NLRC acted w/ grave abuse of discretion & in
excess of jurisdiction in treating the letter of
private respondents (employer) president as an
appeal from the judgment of the LA
- Even assuming that the letter is a valid notice of
appeal, the lack of a cash or surety bond is fatal
to the appeal since the judgment in question
involves a monetary award
7. PAYMENT OF APPEAL FEES
- The appellant shall pay an appeal fee of One
Hundred Fifty Pesos (P150.00) to the Regional
Arbitration Branch or Regional Office of origin,
and the official receipt of such payment shall
form part of the records of the case (Sec 5, Rule
6)
- Failure to pay the appeal docketing fee confers
a directory & not a mandatory power to dismiss
an appeal, & such power must be exercised w/ a
sound discretion & w/ a great deal of
circumspection considering all attendant
circumstances
8. APPEAL BOND; FILING ON TIME;
EXCEPTIONS
In case the decision of the Labor Arbiter or the Regional
Director involves a monetary award, an appeal by the
employer may be perfected only upon the posting of a
bond, which shall either be in the form of cash deposit or
surety bond equivalent in amount to the monetary
award, exclusive of damages and attorney's fees.
12
In case of surety bond, the same shall be issued by a
reputable bonding company duly accredited by the
Commission or the Supreme Court, and shall be
accompanied by original or certified true copies of the
following:
a) a joint declaration under oath by the employer, his
counsel, and the bonding company, attesting that the bond
posted is genuine, and shall be in effect until final
disposition of the case.
b) an indemnity agreement between the employer-
appellant and bonding company;
c) proof of security deposit or collateral securing the bond:
provided, that a check shall not be considered as an
acceptable security;
d) a certificate of authority from the Insurance
Commission;
e) certificate of registration from the Securities and
Exchange Commission;
f) certificate of authority to transact surety business from
the Office of the President;
g) certificate of accreditation and authority from the
Supreme Court; and
h) notarized board resolution or secretary's certificate from
the bonding company showing its authorized signatories
and their specimen signatures.
A cash or surety bond shall be valid and effective from the
date of deposit or posting, until the case is finally decided,
resolved or terminated, or the award satisfied. This
condition shall be deemed incorporated in the terms and
conditions of the surety bond, and shall be binding on the
appellants and the bonding company.
The appellant shall furnish the appellee with a certified true
copy of the said surety bond with all the above-mentioned
supporting documents. The appellee shall verify the
regularity and genuineness thereof and immediately report
any irregularity to the Commission.
Upon verification by the Commission that the bond is
irregular or not genuine, the Commission shall cause the
immediate dismissal of the appeal, and censure or cite in
contempt the responsible parties and their counsels, or
subject them to reasonable fine or penalty.
No motion to reduce bond shall be entertained except on
meritorious grounds, and only upon the posting of a bond
in a reasonable amount in relation to the monetary award.
The mere filing of a motion to reduce bond without
complying with the requisites in the preceding paragraphs
shall not stop the running of the period to perfect an
appeal. (Sec 6, Rule 6)
- The appeal of a decision involving a monetary
award in labor cases may be perfected only
upon the posting of a cash or surety bond
CASE: Rosewood Processing v. NLRC (1998)
- Petitioner had filed, together w/ its memorandum
on appeal & notice of appeal, a motion to reduce
the appeal bond accompanied by a surety bond
for P50K
- But the judgment being appealed from was for
P700K+, so the SolGen argued that it was
defective since it was not equivalent to the
monetary award in the judgment appealed from
- SC held that petitioners motion to reduce the
bond is a substantial compliance w/ the LC.
Letter-perfect rules must yield to the broader
interest of substantial justice
- HOWEVER, more recent SC decisions require
strict observance of the reglementary period
CASE: Sameer Overseas Placement Agency v.
Levantino (2005)
Facts:
- Sameer, the recruitment agency, appealed to the
NLRC from a decision granting a monetary
award to the dismissed employee
- On the 10th day, it filed its notice of appeal &
memorandum of appeal along w/ a motion for
extension of time to file a surety-appeal bond,
alleging that it was still arranging for the
issuance of such w/ the binding company
- 6 days after, it filed the appeal bond
- The NLRC & the CA both dismissed the appeal
for failure to perfect it w/in the 10-day
reglementary period
- Sameer argues that the filing of the bond should
retroact to the date of the filing of the motion for
reduction. It characterized the appeal bond
requirement as procedural, & urges that the
case be decided on the merits
Ruling:
- The appeal bond requirement is not merely
procedural but jurisdictional, for w/o it, the NLRC
does not acquire jurisdiction over the appeal
- The filing of the motion to reduce bond shall not
stop the running of the period to perfect appeal
8.1 Motion to Reduce Bond Under NLRC Rules
No motion to reduce bond shall be entertained except on
meritorious grounds, and only upon the posting of a
13
bond in a reasonable amount in relation to the monetary
award.
The mere filing of a motion to reduce bond without
complying with the requisites in the preceding paragraphs
shall not stop the running of the period to perfect an
appeal.
8.2 No Bond, No Appeal Perfected
CASE: Borja Estate v. Sps. R. Ballad
- only makes it clear that the lawmakers intended
the posting of a cash or surety bond by the
employer to be the exclusive means by w/c an
employers appeal may be considered completed
- The law however does not require its outright
payment, but only the posting of a bond to ensure
that the award will be eventually paid should the
appeal fail
- What petitioners have to pay is a moderate &
reasonable sum for the premium of such bond
- may be perfected refers to the perfection of an
appeal as optional on the part of the defeated
party, but not to the posting of an appeal bond, if
he desires to appeal
- The posting of a cash or surety bond is mandatory
& the perfection of an appeal in the manner & w/in
the period prescribed by law is not only mandatory
but jurisdictional
8.2a Relaxing the 10-Day Period
Situations where the court allowed tardy appeals (Borja
case):
- where the presence of any justifying circumstance
recognized by law (fraud, accident, mistake)
properly vested the judge w/ discretion to approve
or admit an appeal filed out of time
- where on equitable grounds, the questioned
decision was served directly upon petitioner
instead of her counsel of record who at the time
was already dead
- where the counsel relied on the footnote of the
notice of the decision of the LA that the aggrieved
party may appeal w/in 10 working days
- where the tardy appeal is from a decision granting
separation pay w/c was already granted in an
earlier final decision (to prevent unjust enrichment)
- where there are special circumstances in the case
combined w/ its legal merits or the amt & the issue
involved
8.3 No Distinction Between Filing & Perfection of
Appeal; Star Angel Decision, Not Venerable
- Star Angel ruling that the appeal must be filed
w/in 10 days but may be perfected after that
period, was just an obiter dictum & must not be
invoked
CASE: Computer Innovations Center v. NLRC
- Star Angel ruling has not acquired the sheen of
venerability reserved for repeatedly-cited cases
- The present provision in the NLRC Rules of
Procedure that the filing of a motion to reduce
bond shall not stop the running of the period to
perfect appeal flatly contradicts the notion
expressed in Star Angel that there is a
distinction between filing an appeal & perfecting
an appeal
8.4 Amount of Appeal Bond Excludes Damages
- An appeal is deemed perfected upon the posting
of the bond equivalent to the monetary award
exclusive of moral & exemplary damages as well
as attorneys fees
- This NLRC exclusionary rule explains how the
appeal bond shall be computed & this does not
conflict w/ Art 223 w/c lays down the
requirement that an appeal bond should be filed
8.5 Is Property Bond Acceptable?
CASE: UERM Memorial Medical Center v. NLRC
- Appealing the P17M award, the employer
hospital posted as appeal bond a real estate
bond worth more than P100M since it was not in
a financial position to post a cash bond or to pay
an annual premium of P700K for a surety bond
- The NLRC rejected the property bond &
dismissed the appeal arguing that the bond
should either be cash or surety
- SC held that the real property bond sufficiently
protects the interests of private respondents
should they finally prevail
8.6 Bond Accepted Conditionally
- If a bond filed by the appellant is accepted by
the NLRC subject to certain conditions (such as
submission of a certified copy of the title), the
failure to fulfill those conditions on time is
tantamount to a failure to post the bond required
by law
8.7 Supersedeas Bond
14
 - There is no procedural error that may be imputed
to the arbiter in requiring the employer to post
supersedeas bond (a type of surety bond that a
court requires from an appellant who wants to
delay payment of a judgment until the appeal is
over) as a condition for the stay of immediate
execution of the judgment against it, after appeal
had been taken from said judgment
- Since the motion for immediate execution was
presented w/in the period of appeal, it was w/in the
arbiters competence for him to consider the
matter & resolve it even after the lapse of the
appeal period
9. RECORDS & TRANSMITTAL
The records of a case shall have a corresponding index of
its contents which shall include the following:
a) the original copy of the complaint;
b) other pleadings and motions;
c) minutes of the proceedings, notices, transcripts of
stenographic notes, if any;
d) decisions, orders, and resolutions as well as proof of
service thereof, if available;
e) the computation of the award;
f) memorandum of appeal and the reply or answer thereto,
if any, and proof of service, if available;
g) official receipt of the appeal fee; and
h) the appeal bond, if any.
The records shall be chronologically arranged and paged
prominently.
Within forty-eight (48) hours after the filing of the appeal,
the records of the case shall be transmitted by the
Regional Arbitration Branch or office of origin to the
Commission. (Secs 7 & 8, Rule 6)
10. EFFECT OF APPEAL OF ARBITERS DECISION
Without prejudice to immediate reinstatement pending
appeal under
Section 6 of Rule XI, once an appeal is filed, the Labor
Arbiter loses jurisdiction over the case. All pleadings and
motions pertaining to the appealed case shall thereafter be
addressed to and filed with the Commission. (Sec 9, Rule
6)
10.1 Execution or Reinstatement Pending Appeal
In case the decision includes an order of reinstatement,
and the employer disobeys the directive under the second
paragraph of Section 14 of Rule V or refuses to reinstate
the dismissed employee, the Labor Arbiter shall
immediately issue writ of execution, even pending appeal,
directing the employer to immediately reinstate the
dismissed employee either physically or in the payroll,
and to pay the accrued salaries as a consequence of
such reinstatement at the rate specified in the decision.
The Sheriff shall serve the writ of execution upon the
employer or any other person required by law to obey
the same.If he disobeys the writ, such employer or
person may be cited for contempt in accordance with
Rule IX. (Sec 6, Rule 11)
10.2 Effect of Perfection of Appeal on Execution
The perfection of an appeal shall stay the execution of
the decision of the Labor Arbiter on appeal, except
execution for reinstatement pending appeal. (Sec 9,
Rule 11)
11. FRIVOLOUS OR DILATORY APPEALS
No appeal from an interlocutory order shall be
entertained.To discourage frivolous or dilatory appeals,
including those taken from interlocutory orders, the
Commission may censure or cite in contempt the erring
parties and their counsels, or subject them to reasonable
fine or penalty.
12. APPEALS FROM DECISION OF OTHER
AGENCIES
The Rules provided herein governing appeals from the
decisions or orders of Labor Arbiters shall apply to
appeals to the Commission from decisions or orders of
the other offices or agencies appealable to the
Commission according to law.
13. PROCEEDINGS BEFORE THE COMMISSION
(see RA 9347 w/c, among other changes, increased the
NLRC divisions from 5 to 8, w/ 3 commissioners each
division)
Commission En Banc. - The Commission shall sit en
banc only for purposes of promulgating rules and
regulations governing the hearing and disposition of
cases before its Divisions and Regional Arbitration
Branches, and for the formulation of policies affecting its
administration and operations.It may, on temporary or
emergency basis, allow cases within the jurisdiction of
any Division to be heard by any other Division whose
docket allows the additional workload and such transfer
will not expose litigants to unnecessary additional
expense.
Divisions. - Unless otherwise provided by law, the
Commission shall exercise its adjudicatory and all other
powers, functions and duties through its five (5)
15
Divisions.Each Division shall consist of one member from
the public sector who shall act as the Presiding
Commissioner and one member each from the workers
and employers sectors, respectively.
The presence of a majority of all the members of the
Commission shall be necessary to constitute a
quorum.The vote or concurrence of the majority of the
members constituting a quorum shall be the decision or
resolution of the Commission en banc.
The presence of at least two (2) Commissioners of a
Division shall constitute a quorum.The concurrence of two
(2) Commissioners of a Division shall be necessary for the
pronouncement of a judgment or resolution.
Whenever the required membership in a Division is not
complete and the concurrence of two (2) Commissioners
to arrive at a judgment or resolution cannot be obtained,
the Chairman shall designate such number of additional
Commissioners from the other Divisions as may be
necessary from the same sector.
Role of Chairman in the Division. - The Chairman of the
Commission may convene and preside over the session of
any Division to consider any case pending before it and
participate in its deliberations, if in his judgment, his
presence therein will best serve the interests of labor
justice.He shall not however, participate in the voting by
the Division, except when he is acting as Presiding
Commissioner of the Division in the absence of the regular
Presiding Commissioner. (Sec 2 & 4, Rule 7)
13.1 Issues on Appeal
- The Commission shall, in cases of perfected
appeals, limit itself to reviewing those issues w/c
are raised on appeal
- Those w/c are not raised on appeal shall be final &
executory
- However, the issued raised on appeal shall be
opened for review & any action taken thereon by
the Commission are w/in the parameters of its
jurisdiction
13.2 Technical Rules Not Binding
The rules of procedure and evidence prevailing in courts of
law and equity shall not be controlling and the Commission
shall use every and all reasonable means to ascertain the
facts in each case speedily and objectively, without regard
to technicalities of law or procedure, all in the interest of
due process.
In any proceeding before the Commission, the parties may
be represented by legal counsel but it shall be the duty of
the Chairman, any Presiding Commissioner or
Commissioner to exercise complete control of the
proceedings at all stages. (Sec 10, Rule 7)
13.2a Evidence Submitted on Appeal to NLRC
- The NLRC is not precluded from receiving
evidence on appeal as technical rules of
evidence are not binding in labor cases
- The submission of additional evidence in
support of the employees appeal does not
prejudice the employer since the latter could
submit counter-evidence
CASE: Philippine Telegraph & Telephone Corporation v.
NLRC
- Respondent Commission rejected the
uncontradicted evidence submitted by petitioner
employer showing payment to the employee of
his holiday & rest day pay since it was not
presented at the 1st opportunity, presumably
when the case was pending w/ the LA
- Even if the evidence was not submitted to the
LA, the fact that it was duly introduced on appeal
to respondent Commission is enough basis for
the latter to have been more judicious in
admitting the same
- Labor officials should use every reasonable
means to ascertain the facts in each case
speedily & objectively, w/o regard to
technicalities of law or procedure, all in the
interest of due process
13.3 Conciliation / Mediation
In the exercise of its exclusive, original and appellate
jurisdiction, the Commission may exert all efforts
towards the amicable settlement of a labor dispute.
The settlement of cases on appeal, to be valid and
binding between the parties, shall be made before the
Commissioner or his authorized representative. (Sec 11,
Rule 7)
13.4 Consultation
The conclusions of a Division on any case or matter
submitted to it for decision shall be reached in
consultation before the case is assigned to a member for
the writing of the opinion.It shall be mandatory for the
Division to meet for the purpose of the consultation
ordained herein.
A certification to this effect signed by the Presiding
Commissioner of the Division shall be issued and a copy
thereof attached to the record of the case and served
upon the parties. (Sec 5, Rule 7)
16

13.5 Dissenting Opinion
Should any member of a Division indicate his intention to
write a dissenting opinion, he may file the same within the
period prescribed for deciding or resolving the appeal;
otherwise, such written dissenting opinion shall not be
considered part of the records of the case. (Sec 6, Rule 7)
13.6 Inhibition
No motion to inhibit the entire Division of the Commission
shall be entertained.However, any Commissioner may
inhibit himself from the consideration and resolution of any
case or matter before the Division and shall so state in
writing the legal or justifiable grounds therefor.In the event
that a member inhibits himself, the case shall be raffled by
the Executive Clerk or Deputy Executive Clerk to either of
the two (2) remaining Commissioners.In case two (2)
Commissioners in a Division inhibit themselves in a case
or matter before it, the Chairman shall, as far as
practicable, appoint two (2) Commissioners from other
Divisions representing the sector of the Commissioners
who inhibited themselves. (Sec 7, Rule 7)
14. FORM OF DECISION, RESOLUTION & ORDER
The decision, resolution and order of the Commission shall
state clearly and distinctly the findings of facts, issues, and
conclusions of law on which it is based, and the relief
granted, if any.If the decision, resolution or order involves
monetary awards, the same shall contain the specific
amount awarded as of the date the decision is rendered.
(Sec 13, Rule 7)
- Under Art 223, the Commission shall decide all
cases w/in 20 calendar days from receipt of the
answer of the appellee
- The decision of the Commission shall be final &
executory after 10 calendar days from receipt
thereof by the parties
- Any enforcement agency may be deputized by the
Sec. of Labor or the Commission in the
enforcement of decision, awards, or orders
Reasoned Reversal
- While it is w/in the Commissions competence, as
an appellate agency reviewing decisions of Labor
Arbiters, to disagree with & set aside the latters
findings, it should state an acceptable cause
therefor, otherwise, it is subject to invalidation by
the extraordinary writ of certiorari
Extended Meaning of Appeal under Art. 223; NLRC
May Issue Writ of Certiorari
CASE: Triad Security & Allied Services, Inc. v. Ortega
- Petitioners insist that the NLRC is bereft of
authority to rule on a matter involving GAD that
may be committed by a LA
- Abuse of discretion is admittedly w/in the ambit
of certiorari & its grant thereof to the NLRC
indicates the lawmakers intention to broaden
the meaning of appeal
- Being the administrative agency especially
tasked w/ the review of labor cases, the NLRC is
in a far better position to determine whether
petitioners grounds for certiorari are meritorious
- The CA correctly dismissed the petition for
certiorari brought before it
15. FINALITY OF DECISION OF THE
COMMISSION & ENTRY OF JUDGMENT
a) Finality of the Decisions, Resolutions or Orders of the
Commission. - Except as provided in Section 9 of Rule
X, the decisions, resolutions or orders of the
Commission shall become final and executory after ten
(10) calendar days from receipt thereof by the parties.
b) Entry of Judgment. - Upon the expiration of the ten
(10) calendar day period provided in paragraph (a) of
this Section, the decision, resolution, or order shall be
entered in a book of entries of judgment.
The Executive Clerk or Deputy Executive Clerk shall
consider the decision, resolution or order as final and
executory after sixty (60) calendar days from date of
mailing in the absence of return cards, certifications from
the post office, or other proof of service to parties. (Sec
14, Rule 7)
16. MOTIONS FOR RECONSIDERATION
Motion for reconsideration of any decision, resolution or
order of the Commission shall not be entertained except
when based on palpable or patent errors; provided that
the motion is under oath and filed within ten (10)
calendar days from receipt of decision, resolution or
order, with proof of service that a copy of the same has
been furnished, within the reglementary period, the
adverse party; and provided further, that only one such
motion from the same party shall be entertained.
Should a motion for reconsideration be entertained
pursuant to this section, the resolution shall be executory
after ten (10) calendar days from receipt thereof. (Sec
15, Rule 7)
- The NLRC Rules does not allow a 2nd motion for
reconsideration
- A supplemental motion for reconsideration filed
17
 outside of the 10-day appeal period cannot be
entertained
16.1 Party Who Failed to Appeal on Time From
Decision of LA May Still File Motion for
Reconsideration of NLRC Decision
CASE: Sadol v. Pilipinas Kao, Inc.
Facts:
- Illegal dismissal case filed by Sadol against
respondents. The LA rendered a decision ordering
private respondent to pay petitioner separation
pay at 1 month for every year of service.
Petitioner appealed to the NLRC. Respondents
also appealed but it was filed out of time
- The NLRC modified the appealed decision
ordering respondent to reinstate petitioner w/ full
backwages & other accrued benefits.
Respondents appeal was dismissed for being filed
out of time
- Upon receipt of respondent of the NLRC decision,
a motion for reconsideration was filed w/c
petitioner opposed
- The NLRC set aside its decision & dismissed the
case for lack of merit
- Hence, the petition for certiorari
Ruling:
- Party who failed to appeal from a decision of the
LA to the NLRC can still participate in a separate
appeal timely filed by the adverse party by a
motion for reconsideration of the decision of the
NLRC on appeal
- The rules of technicality must yield to the broader
interest of justice. It is only by giving due course
to the motion for reconsideration that was timely
filed that the NLRC may be able to equitably
evaluate the conflicting versions of facts presented
by the parties
Avril (129-142)
Appeal from the NATIONAL LABOR RELATIONS
COMMISSION
Review by Certiorari by the Court of Appeals
Case:
St Martin Funeral Home vs. NLRC
GR no. 130866, Sept. 16, 1998
Regalado, J.
Facts:
Bienvenido Aricayos, a former overseas contract worker
started to work as Operations Manager of St, Martin
Funeral Home on February 6, 1995 as a financial
assistance from the Mother of Amelita Malabad, the
owner of said entity. There was no employment contract
executed nor was Aricayos name was included in the
payroll.
In January 1996, Amelitas mother passed away. Amelita
took over the management of the business. This is
where she found out that there were arrears in the
payment of taxes and other governmental fees but the
records show it was paid. Amelita made some changes
in the business and dismissed Aricayos and his wife by
not allowing them to participate in the management
anymore.
Aricayos filed a complaint with the Labor Arbiter claiming
he was illegally dismissed by Amelita. The Labor Arbiter
ruled that no employee-employer relationship exists and,
therefore, the office has no jurisdiction over the case.
Aricayos appealed to the NLRC, which set aside the
decision of the LA stating the there exists an employee-
employer relationship. The case was remanded to the
LA for immediate appropriate proceedings. Hence, this
present petition.
ISSUE:
Whether or not the SC has jurisdiction over the case for
judicial review?
RULING:
There is an underlying power of the courts to scrutinize
the acts of quasi-judicial agencies on question of law
and jurisdiction even though no right to review is given
by statute. The purpose of judicial review is to keep the
administrative agency within its jurisdiction and protect
the substantial rights of the parties. It is a part of checks
and balances which restricts the separation of powers.
Such review is available within 60 days from notice of
decision under rule 65 on action for certiorari.
BP 129 originally states that IAC shall have appellate
jurisdiction over decisions of quasi-judicial agencies and
18
original jurisdiction over certioraris and other auxillary
writs. However the provisions do not apply to orders
issued under the Labor Code and CBAA. RA 7902,
amending BP129, states that the CA has exclusive original
jurisdiction over final judgments, decisions, resolutions,
orders and awards of quasi-judicial agencies, except those
falling within the appellate jurisdiction of the SC in
accordance with the constitution, the Labor Code of the
Philippines, as amended.
Under such excepting clause, the appeal from NLRC
cannot be brought to CA but to the SC. Congress could not
have intended such since there are no cases in Labor
Code that falls within the appellate jurisdiction of the SC.
In Senate Bill No.1495, Senator Roco states that BP 129
expanded the jurisdiction of the CA. The purpose of the
law is to ease the workload of the SC. The exceptions
seem to cut short that purpose and should be eliminated.
In a subsequent session, such amendment was approved.
Such amendment now declares that appeals from NLRC
shall be petitions for certiorari under rule 65 and should be
initially filed with the CA in strict observance of the doctrine
on the hierarchy of courts.
Instant petition is remanded to CA for appropriate action.
Doctrine of the case:
1. to review NLRC decision is through special civil
action of certiorari under rule 65
2. jurisdiction of such belong to SC and CA
3. in line with hierarchy of courts , petition should be
initially filed with the CA, as the lower court
When and Where to File Petition
AM No. 00-2-03SC amending Rule 65, Sec.4 (effective
September 1, 2000) provides:
petition shall be filed no later than 60 days from
the notice of the judgment, order or resolution
in case of motion for reconsideration, the 60 days
period shall be counted from notice of the denial of
such motion
amendment is procedural and has retroactive
effect and applies to petitions filed before
September 1, 2000 which are pending and
undetermined at the time of its passage.
Note:
the 60-day period must be carefully observed
Reglementary Periods are indispensable
interdictions against needless delays
Incorrect computation of time by the petitioners
counsel is inexcusable neglect, and the client is
bound by the counsels conduct, negligence and
mistakes
Appeals under Rule 45 and in Original Civil
Actions for Certiori under Rule 65, what is
required is the Certified True copy of the
questioned judgment which is the NLRCs
decision
Effect on NLRCs Decision
A petition for certiorari does not stay execution
the decision of the NLRC, unless a TRO is
issued by the CA or SC
Appeal to Labor Secretary Abolished
Due to the PD No. 1391 amending Art. 223 of
the Labor Code, the remedy of appeal from a
decision of the NLRC to the Secretary of Labor
has been abolished
Grounds for Certiorari (as a special civil action)
a) the tribunal, board or officer exercising
judicial function has acted without or in
excess of its jurisdiction
b) grave abuse of dicretion amounting to lack
or in excess of jurisdiction
the prayer must be for annulment of modification
of the proceedings
although the decision of administrative agencies
are final as stated in statutory provisions, the CA
and SC has the power of judicial review when
there is a:
a. want of jurisdiction
b. grave abuse of discretion
c. violation of the due process,
d. denial of substantial justice
e. erroneous interpretation of the law
there is no appeal from the decisions of the
NLRC for a reversal of its factual or legal
conclusions
Grave Abuse of Discretion
by definition it means the capricious and
whimsical exercise of judgment as is equivalent
to lack of jurisdiction
the petitioner must prove the abuse of
discretion amounting to lack or excess of
jurisdiction on the part of the public respondent
proving a reversible error or mere abuse of
discretion is not enough
Sole Office of Certiorari
the appellate courts jurisdiction to review a
decision of the NLRC in a petition for certiorari is
19
 confined in the issues of jurisdiction or grave
abuse of discretion amounting to lack or excess of
jurisdiction
it dose not include correction of the NLRCs
evaluation of the evidence or of its factual findings
Not a Slave to Technical Rules
Erwin Reyes vs. NLRC, CCBP and/or Rotaida
Taguibao
G.R. No. 180551, February 10, 2009
FACTS:
Coca-Cola Bottlers Philippines (CCBP) is a corporation
engaged in the business of production and distribution of
carbonated drinks. Rotaida Taguibao is its Human
Resource Manager. Erwin Reyes was first employed by
respondent CCBP, through Interserve Manpower Agency
(Interserve), as a Leadman in February 1988. His contract
was renewed every five months and he was assigned a
different task every time. Such an arrangement continued
until petitioner was directly hired by CCBP as a Route
Salesman on September 15, 2000. Exactly one year from
the time of petitioners employment as a Route Salesman,
respondent CCBP, thru Taguibao, terminated his services
on September 15, 2001. Since he already acquired the
status of a regular employee, he is now asserting that he
was illegally dismissed and is claiming for moral and
exemplary damages and attorneys fees.
Labor Arbiter ruled in favor of Reyes, since CCBP and
Taguibao as they failed to present a copy of petitioners
purported Contract of Employment but only the Affidavit of
Taguibao herself. The LA ordered reinstatement and
payment of backwages and attorneys fees. In compliance
with the directive of the LA, CCBP and Taguibao
immediately reinstated petitioner to his former
position. However, they filed a Memorandum of Appeal
before the NLRC. The NLRC dismissed the appeal
affirming with modification the Decision of the
LA.Petitioner, on one hand, maintained that the reckoning
point for the computation of his backwages must be from
the time his employment was unlawfully terminated, and
not from the institution of his Complaint for illegal dismissal
and elevated his case before the Court of Appeals by filing
a Petition for Certiorari.The Court of Appeals dismissed
petitioners Petition for Certiorari for his failure to give any
explanation why a copy of the said Petition was not
personally served upon the counsel of the adverse parties.
Thereafter petitioner sought for the liberality of the Court of
Appeals, faulting his former counsel for the procedural
defects of his Petition but was denied. Hence, this petition.
ISSUE:
Whether or not the CA gravely abused its discretion in not
excusing petitioners procedural lapses?
RULING:
Yes. A dismissal on a mere technicality defeats the
greater interest of substantial justice. Petitioner
attributes the technical flaws committed before the
appellate court to his former counsel, and urges the
Court to excuse him since compliance with the
procedural rules calls for the application of legal
knowledge and expertise which he, as a layman, cannot
be expected to know.
A court shall consider the importance of the subject
matter of the case or the issues involved therein, and
theprima facie merit of the pleading sought to be
expunged for violation of Section 11. This Court cannot
rule otherwise as it is against the purpose of avoiding
delay in the administration of justice.
The Rules of Court itself calls for its liberal construction,
with the view of promoting their objective of securing a
just, speedy and inexpensive disposition of every action
and proceeding. The procedural rules are not to be
belittled or simply disregarded, however, it is equally true
that litigation is not merely a game of technicalities. Law
and jurisprudence grant to courts the prerogative to relax
compliance with procedural rules of even the most
mandatory character, to reconcile both the need to put
an end to litigation speedily and the parties right to an
opportunity to be heard.
In the instant case, it is the petitioners former counsel
who was negligent in handling his case before the Court
of Appeals. The basic general rule is that the negligence
of counsel binds the client. Hence, if counsel commits a
mistake in the course of litigation, thereby resulting in his
losing the case, his client must perforce suffer the
consequences of the mistake. However, where the
negligence of counsel is one that is so gross, palpable,
pervasive, reckless and inexcusable, then it does not
bind the client since, in such a case, the client is
effectively deprived of his or her day in court.
Notes:
the gross negligence of the petitioners former
counsel resulted to the foreclosure of available
remedies to the petitioner
higher interest of justice and equity demand the
petitioner be granted his day in court and not
made to suffer for his counsels indiscretion
Appeal from OSEC to CA; St. Martin Ruling applies
Rulings issued by the Office of the Secretary
(OSEC)of DOLE may be appealed to the CA,
not SC, under the ff. instances
a. regarding regional directors decisions on
complaints of employment agencies
b. regarding compliance order in labor standard
cases under Art. 128 Sec. 2. in relation to Sec.
3a and 4, Rule X, Book III, Implementing Rules,
20
 Rules on Disposition of labor standard cases
under Sec.1, Rule IV, execution, on occupational
health and safety cases
c. denial of application for registration by BLR of
federation, national or industry union, or trade
union center under Art. 236
d. Under Art. 238, cancellation of regisgtration by
BLR or Regional Office
e. Under Art. 259, order of a med-arbiter on a petition
for certification election or as to the results of a
certificate election
f. Under Book V of the Implementing Rules: decision
of BLR regarding administration of unions
g. Under Art 263, decisions in cases of assumption of
jurisdiction
Exhaustion of Administrative Remedies
a) the initial remedy to the decision of the Secretary
of DOLE is to file a motion for reconsideration as a
precondition to a subsequent remedy
b) then file a special civil action of certiorari under
Rule 65
- must be preceded by exhaustion of
administrative remedies
Sunshine Transportation, Inc. vs NLRC and Santos, GR
no. 116025, Feb. 22 1996
- the court dismissed the petition for certiorari
requiring that a motion for reconsideration must first be
made in light of the doctrine od exhaustion of
administrative remedies
Exceptions:
In one subsequent case to Sunshine the court
ruled that by reason of justice and equity, it admits
of certain exceptions to the doctrine of exhaustion
of administrative remedies, among which is the
finding that a motion for reconsideration would be
useless
In Fe Alindao vs. Joson, GR no. 114132, Nov. 14,
1996, the court summarized the exceptions:
a. issue is purely of law
b. public interest is involved
c. cases of urgency
d. where special circumstances
warrant immediate or more direct action
NOTES:
The remedy of appeal from the Secretary of Labor
to the Office of the President is NOT
MANDATORY, failure to avail such relief is not an
impediment to judicial intervention
Despite of such doctrine, DOLE D.O. amended
book V of the Code stating that The decision of
the Secretary shall become final and executory
after 10 days from receipt of the parties. No
motion for reconsideration shall be entertained.
Certificate of Non-Forum Shopping
Forum Shopping
- the act or attempt to present the same
dispute to different jurisdictions, in the hope of
securing a favorable ruling
- not allowed as it contradicts the rule that
one dispute shall be litigated once in one forum
- manifests when a party repetitively
avails itself of several judicial remedies in different
courts, simultaneously or successively, all
substantially founded on the same transactions and
the same essential facts and circumstances, and all
raising substantially the same issues either pending
in, or already resolved adversely by, some other
courts
- if the acts of the party or his counsel
clearly constitutes willful and deliberate forum
shopping, it is a ground for dismissal with prejudice
and shall constitute direct contempt
Filing of Certificate
- failure to comply of filing such certificate
shall be a cause for dismissal without prejudice
- filing of a false certificate constitute a
direct contempt of court
Certificate of Non-Forum Shopping must be made by
Petitioner
Santos, et al. vs. CA, Pepsi Cola Products, et al, GR no.
141947, July 5, 2001
- Sec. 3 Rule 46 of the ROC states that
the petitioner shall together with the petitions sworn
certification that he has not theretofore commenced
any other action involving the same issues in the
SC, the CA or different divisions thereto, or any other
tribunal or agency
- Clearly, certification must be made by
the petitioner himself and his counsel as he is in the
best position to know such fact
BA Savings Bank vs. Sia
- certification against forum shopping may
be signed by the authorized lawyer if the petitioner is
a corporation, since a corporation can only act
through a natural person
Disposition by the CA
SC and CA is allowed to review matters not
assigned as errors, if it finds that its
consideration is necessary in arriving at a just
decision
21

Remand
- where there is ambiguity in the appraisal
of the NLRC and LA and there are still matters that
need to be clarified, equity calls for a remand of the
case the NLRC
Dismissal of Appeal
- even if there is appending appeal to the
NLRC, the SC or CA in a petition for certiorari may find
on substantial proof that the appeal was filed late,
such may constrained to order the NLRC to dismiss
such appeal
Finding of Facts Generally Final
- as a general rule, findings of
administrative agencies are accorded with finality
- such finding of facts is binding to the SC
and CA if supported by substantial evidence
- in the same way, if not supported by
substantial evidence, it is not binding to the SC and
CA
Exceptions:
In Insular Life Assurance Company vs CA, GR
no.126850, April 28, 2004, the exceptions to the
rule that SC is not a trier of facts:
a. findings are grounded entirely
on speculation, surmises or conjectures
b. when the inference made is
manifestly mistaken, absurd or impossible
c. when there is grave abuse of
discretion
d. when the judgment is based on
a misapprehension of facts
e. when the finding of facts are
conflicting
f. when in making its findings, the CA went beyond the
issues of the case or its findings are contrary to the
admissions of both appellant or appellee
g. when the findings are contrary to the trial court
h. when the findings are conclusions without citation
specific evidence on which they are based
i. when the facts set forth in the petition as well as in the
petitioners main and reply briefs are not disputed by
the respondent
j. when the findings of fact are premised on the
supposed absence of evidence and contradicted by
the evidence on record
k. when the CA manifestly overlooked certain relevant
facts not disputed by the parties which would justify a
different conclusion if properly considered
EILEEN (142(20.5)-157)
20.5 EXAMPLES: SOME FINDINGS OF FACTS
REVERSED
Reglementary Period:
The reglementary period for appeal fixed by the
Labor Code is 10 days.
1. it is wrong and a grave abuse of discretion for the
NLRC to fail or refuse to take into account the appeal
taken by the employee from the decision of the labor
arbiter, dismissing his complaint, was late, because it
was perfected 12 days after service on him of notice of
the decision.
2. the NLRC affirmed the arbiters decision, but at the
same time ordered the company to continue paying the
employees salary since the arbitration case was not yet
over.
3. The SC ruled that NLRC order was an abuse of
discretion. The court explained that the clause pending
final resolution of the case by arbitration should be
limited only to the proceedings before the labor arbiter.
4. it is also a grave abuse of discretion on the part of the
NLRC not to give weight to the claim that petitioner is an
Adecor employee, in glossing over the face that it is fully
corroborated by indubitable documents.
21. FROM CA TO SC: ONLY QUESTION OF LAW,
RULE 45
Proper Remedy: Petition for review
is the proper remedy under Rule 45 of the Rules of
Court to appeal to the SC a judgment, final order or
resolution of the CA.
Such petition for review on certiorari
can raise only question of law.
When to file: Within 15 days from
notice of the judgment or final order or resolution
appealed from OR of the denial of the petitioners motion
for new trial or reconsideration.
IN CASE OF FAILURE TO
APPEAL: the petition for certiorari in the nature of
special civil action is NOT available. (NOTE: the special
civil action for certiorari under Rule 65 cannot be used
as a substitute for an appeal under Rule 45 that the
petitioner already lost.)
In one case, the court reminded that
a special civil action for certiorari under Rule 65 lies only
when there is neither appeal nor plain, speedy and
adequate remedy in the ordinary course of law.
22

Certiorari is not allowed when a
party fails to appeal a judgment or final order.
The remedies of appeal and
certiorari are mutually conclusive and NOT alternative or
successive.
In Metro Transit case, the
dismissed employee was ordered reinstated by the Labor
Arbiter, which decision was upheld both by the NLRC and
CA. The employer brought the case to the SC through a
petition for review on certiorari. The petitioner employer
contended that the CA decision had no basis in fact and
contrary to law. It argued that the CA failed to consider
the evidence the employer presented.
HELD: The Sc ruled that in petition for review on
certiorari only question of law may be raised. The court
cannot reexamine the probative value of evidence, unless
the appreciation of the evidence is glaringly erroneous.
Thus, petition on certiorari had to be dismissed.
ARTICLE 224. Execution of decisions, orders or
awards. (a) The Secretary of Labor and Employment
or any Regional Director, the Commission or any
Labor Arbiter, or Med-Arbiter or Voluntary Arbitrator
may, motu proprio or on motion of any interested
party, issue a writ of execution on a judgment within
five (5) years from the date it becomes final and
executory, requiring a sheriff or a duly deputized
officer to execute or enforce final decisions, orders or
awards of the Secretary of Labor and Employment or
regional director, the Commission, the Labor Arbiter or
med-arbiter, or voluntary arbitrators. In any case, it
shall be the duty of the responsible officer to
separately furnish immediately the counsels of record
and the parties with copies of said decisions, orders
or awards. Failure to comply with the duty prescribed
herein shall subject such responsible officer to
appropriate administrative sanctions.
(b) The Secretary of Labor and Employment, and the
Chairman of the Commission may designate special
sheriffs and take any measure under existing laws to
ensure compliance with their decisions, orders or
awards and those of the Labor Arbiters and voluntary
arbitrators, including the imposition of administrative
fines which shall not be less than P500.00 nor more
than P10,000.00.
1. EXECUTION
A writ of execution is an order to carry out, to
implement, a final judgment.
Under Art. 224, it may be issued by the following
officials for the final decisions, orders or awards
promulgated by them:
a. Secretary of Labor and Employment;
b. DOLE Regional Director;
c. NLRC;
d. Labor Arbiter;
e. Med-arbiter;
f. Voluntary Arbitrator; or
g. Panel of Arbitrators
WHEN TO ISSUE: may be issued
motu proprio or on motion of any interested party within
5 years from the date it becomes final and executory.
Execution is done through the
regular or special sheriff. BUT alternatively, the PNP or
any law enforcement agencies may deputize in the
enforcement of final awards, orders or decisions by the
Secretary, the Commission, any Labor Arbiter, the
Regional Director or the Director of the Bureau of labor
Relations.
1.1 BOTH PARTY AND COUNSEL SHOULD BE
NOTIFIED
- in Labor Cases, both the party and its counsel
must be duly served their separate copies of the order,
decision, or resolution.
1.2 ARTICLE 224 IS EXECUTION, NOT APPEAL,
PROCEDURE
- Art. 224 is about execution; it does not govern
the procedure for filing a petition for certiorari with the
CA from the decision of the NLRC.
It refers to the execution of final decisions,
orders or awards.
The period or manner of appeal from the NLRC
to CA is governed by RULE 65 and NOT
ARTICLE 224.
2. EXECUTION UPON FINALITY OF DECISION OR
ORDER
a. A writ of execution may be issued moto proprio or on
motion, upon a decision that finally disposes of the
action or proceeding, BUT only after the expiration of the
period to appeal if no appeal has been filed, as shown
by the certificate of finality.
b. NO motion for execution shall be entertained nor a
writ of execution be issued UNLESS the Labor Arbiter or
the Commission is in possession of the records of the
case which shall include an entry of judgment if the case
was appealed.
EXCEPTIONS: as provided in Sec. 14 of Rule 5
and Sec. 6 of this Rule, and in those cases
where partial execution is allowed by law.
PRE-EXECUTION CONFERENCE
23
 The Labor Arbiter shall schedule a pre-execution
conference or hearing within 2 working days from receipt
of a motion for the issuance of a writ of execution and
subject to Section 1, par. B of this Rule.
This is to thresh out matters relevant to execution,
including the computation of award.
FORM AND CONTENTS OF A WRIT OF EXECUTION
1. issued in the name of Republic of the Philippines;
2. signed by the Commission or Labor Arbiter;
3. requiring the Sheriff to execute the decision,order or
award of the Commission or Labor Arbiter;
4. must contain the dispositive portion thereof, amount to
be demanded, and all lawful fees to be collected from the
losing party or any other person required by law to obey
the same.
COMPUTATION DURING EXECUTION
If it is necessary during the course of the
execution proceedings, no writ of execution shall be issued
until after the computation has been approved by the
Labor Arbiter.
EXECUTION OF MONETARY JUDGMENT
a. Immediate payment on demand the Sheriff shall
enforce by demanding the immediate payment of the full
amount stated in the writ of execution and all lawful fees
from the losing party or any other person required by law
to obey the same.
b. In case of failure or refusal to pay, the Sheriff shall
immediately proceed against the cash deposit or surety
bond posted by the losing party, if any.
c. if the bonding company refuses to comply with the writ
of execution, then its president and officers or authorized
representatives shall be cited for contempt and be barred
from transacting business with the Commission.
d. if the cash or surety bond is insufficient, or if cannot be
proceeded against for any reason, the Sheriff shall within 5
days from demand, execute the monetary judgment by
levying on the property, personal and real, of the losing
party not exempt from execution.
Which must be sufficient to cover the judgment
award, which may be disposed of for value at a
public auction to the highest bidder.
e. proceeds of execution must be deposited with the
Cashier of the concerned Division or Regional Arbitration
Branch, or with an authorized depositary bank.
If payment is in check, the same shall be payable
to the Commission.
ENFORCEMENT OF WRIT OF EXECUTION
The sheriff or other authorized officer acting as
sheriff of the Commission shall be guided strictly by
these Rules, and by the Manual on Execution of
Judgment, which shall form part of these Rules. The
Rules of Court, as amended, shall be applied suppletory.
EXECUTION BY MOTION OR BY INDEPENDENT
ACTION
Within 5 years from the date it becomes final
and executory.
After the lapse of such period, the judgment
shall become dormant, and may only be
enforced by an independent action within the
period of 10 years from the date of its finality.
EFFECT OF PETITION FOR CERTIORARI ON
EXECUTION
A petition for certiorari with the CA or SC shall
not stay the execution of the assailed decision unless a
restraining order is issued by said courts.
RESOLUTION OF MOTION TO QUASH
It must be resolved by the Labor Arbiter within
10 working days from submission of said motion for
resolution.
3. APPEAL ON THE EXECUTION OF DECISION;
SUPERVENING EVENTS
Generally, once a judgment becomes final and
executory, it can no longer be disturbed, altered or
modified.
EXCEPT: in cases of supervening events, it
becomes imperative, in the highest interest of justice, to
direct its modification in order to harmonize the
disposition with the prevailing circumstances or
whenever it is necessary to accomplish the aims of
justice.
The correctness of the execution of the decision
of Labor Arbiter may be appealed to and reviewed by
NLRC.
Abbott vs NLRC
In the instant case, what must be reviewed is the
manner of its execution and not the decision itself.
FACTS: the fact alone that the labor arbiter, in
recomputing the award in the original decision, raised it
from the amount of P98,883.80 to the astonishing sum of
P1,372,451.55 is justification enough for the respondent
NLRC to issue the challenged TRO. In the meantime
anyway, the petitioners are protected by the
supersedeas bond put up by the respondent in the
amount of the recomputed award.
HELD: The Court ruled that the NLRC has the authority
to look into the correctness of the execution of the
24
decision and to consider the supervening events that may
affect such execution, like the possible off-set of the
petitioners advances or debts against their total claim,
their discontinuance from employment by abandonment or
resignation, and other relevant developments.
Pacific Mills, Inc. vs NLRC
FACTS: The entry of judgment having been effected, the
NLRC in the process of execution of the decision of the
labor arbiter made a computation of the award to the
private respondent in the amount of P680,037.30. The
NLRC issued a partial writ of execution for P655,527.30.
The petitioner filed a motion to stay
execution/reconsideration citing supervening events that
affect the computation of the award as follows:
1. the computation of separation pay did not consider the
length of service of each complainant as borne out from
the records;
2. the computation did not consider the wage exemptions
granted petitioner-respondent company;
3. the computation included payment of awards to a
respondent who had already been recalled to active duty,
one who was already paid in a case separately filed, and
another who was already paid regardless of the result of
the case docketed G.R. No. 79535;
4. Meanwhile, all the capital assets of the petitioner have
already been attached by Philippine Cotton Corp., and/or
otherwise foreclosed by the DBP in appropriate
proceedings.
The NLRC did not stay execution of judgment and
issued an order for immediate implementation of the partial
writ of execution without further delay.
Petitioner filed a petition before the SC.
HELD: The Supervening events cited by petitioner would
certainly affect the computation of the award in the
decision of the NLRC.
Thus, a prompt and immediate determination of
these objections and a recomputation of the award should
be made.
A denial of this opportunity to correct clear error in
the execution of the judgment constitutes a grave abuse of
discretion.
4. GENERAL RULE: RTC CANNOT ISSUE INJUNCTION
AGAINST NLRC
A regular court has no jurisdiction to hear and
decide questions which arise and are incidental to the
enforcement of decisions, orders or awards rendered in
labor cases by appropriate officers and tribunals of the
DOLE.
The tribunal which issued the writ of execution
has the inherent power to control its own processes in
order to enforce its judgments and orders.
The RTC has jurisdiction for an action for
damages.
Jurisdiction to try and adjudicate labor cases
including execution of decisions, awards or order
pertains exclusively to the proper labor official concerned
under the DOLE.
In one case, petitioner failed to realize that by
filing its third-party claim with the deputy sheriff, it
submitted itself to the jurisdiction of the Commission
acting through Labor Arbiter.
Once Jurisdiction is acquired it is not lost upon
the instance of the parties but continues until the case is
terminated.
Any court which issued a writ of execution has
the inherent power, for the advancement of justice, to
correct errors of its ministerial officers and to control its
own processes.
4.1 EXECUTION OVER PROPERTY OWNED ONLY BY
JUDGMENT DEBTOR; REMEDIES OF THIRD PARTY
CLAIMANT; the YUPANGCO CASE
The power of the Court or NLRC to execute its
judgments extends only to properties unquestionably
belonging to the judgment debtor.
If a third-party claim does not involve nor grows
out of, a labor dispute, a separate action for injunctive
relief against such levy may be maintained in court.
Under the Revised Rules of the NLRC (Sec.4,
Rule IX) [Sec. 7, Rule VIII of the NLRC Rules, 2002], the
sheriff of the Commission, or other officer acting as such,
must be guided strictly by the Sheriffs Manual which
shall form part of these Rules; and under Sec. 2, Rule
VI of the said Manual, when a third party claims the
property subject of the execution and files an affidavit
thereto, the Labor Arbiter shall ..conduct a hearing xxx
and resolve the validity of the claim
YUPANGCO COTTON MILLS, INC. vs. CA
A third party whose property has
been levied upon by a sheriff to enforce a decision
against a judgment debtor is afforded with several
alternative remedies cumulatively, to protect its interests.
The following are the remedies:
1. file a third party claim with the
Sheriff or Labor Arbiter;
2. if denied, the third party may appeal
25
it to NLRC.
Section 17(now 16), Rule 39,
Revised Rules of Court supports the third party claim in
case it was denied and to recover the property illegally
seized by the sheriff.
In Ong vs Tating, et al., a third person
whose property was seized by a sheriff to answer for the
obligation of a judgment debtor may invoke the
supervisory power of the court which authorized such
execution.
However, the claim will be denied if
the claimants proofs do not persuade the court of the
validity of his title or right of possession.
TERCERIA a remedy available to a
third-party claimant (provided in Sec. 17 (now 16), Rule
39), by serving on the officer making the levy an affidavit of
his title and a copy thereof upon the judgment creditor.
WHEN AN ACTION FOR DAMAGES BE BROUGHT
AGAINST THE SHERIFF?
Within 120 days from the filing of the bond.
PROPER ACTION AGAINST THE SHERIFF AND SUCH
OTHER PARTIES TO HAVE COLLUDED WITH HIM FOR
THE WRONGFUL EXECUTION PROCEEDINGS?
1. recovery of ownership; or
2. possession of the property seized by the Sheriff
3. damages resulting from the allegedly wrongful
seizure and detention thereof.
These remedies are cumulative and may be
resorted to by a third-party claimant independent of or
separately from and without need of availing of the others.
The filing of the third-party claim with the Labor
Arbiter and the NLRC did not preclude the petitioner from
filing a subsequent action for recovery of property and
damages with the RTC. And, the institution of such
complaint will not make petitioner guilty of forum shopping.
4.2 RTC INJUNCTION AGAINST LABOR ARBITER OR
NLRC, WHEN ALLOWED
The RTC can issue an injunction or TRO against
the execution ordered by a labor arbiter or the NLRC
where the reinvindicatory action is filed.
YUPANGCO COTTON MILLS, INC. vs. CA-
In Santos vs. Baylon,
FACTS:
the Labor Arbiter Ceferina Diosana
rendered a decision in favor of Kamapi, the NLRC affirmed
the decision.
Kamapi obtained a writ of execution
against the properties of Poly-Plastic Products or
Anthony Ching.
Respondent Priscilla Carrera filed a
third-party claim alleging that Ching had sold the
property to her.
The NLRC Sheriff proceeded with
the public auction sale upon posting by the judgment
creditor of an indemnity bond.
Carrera filed with RTC an action to
recover the levied property and obtained a TRO against
Labor Arbiter Diosana and the NLRC Sheriff from issuing
a certificate of sale over the levied property.
Labor Arbiter Santos issued an
order allowing the execution to proceed against the
property of Poly-Plastic Products.
Santos and NLRC Sheriff filed a
motion to dismiss the civil case instituted by respondent
Carreraon the ground that RTC has no jurisdiction.
HELD:
The power of the NLRC to execute
its judgments extends only to properties unquestionably
belonging to the judgment debtor.
GR.: NO court has the power to
interfere by injunction with the judgments or decrees of
another court with concurrence or coordinate jurisdiction
possessing equal power to grant injunctive relief, applies
only when no third-party claimant is involved.
In Consolidated Bank and Trust Corp. vs CA
A proper levy is indispensable to a
valid sale on execution.
A sale unless preceded by a valid
levy is void.
Thus, the private respondent did not
take any title to the properties sold thereunder, since
there was no sufficient levy on the execution in question.
In Lorenzana vs Cayetano
The rights of a third-party claimant
should be decided in a separate action instituted by the
third person.
The appeal that should be
interposed is a separate reinvindicatory action against
the execution creditor or purchaser of the property after
the sale at public auction, or complaint for damages to
be charged against the bond filed by the judgment
creditor in favor of the Sheriff. Such action is reserved to
third-party claimant.
A separate action for recovery, upon
a claim and prima facie showing of ownership by the
petitioner, cannot be considered as interference.
4.3 THIRD PARTY CLAIM
The NLRC Rules of Procedure,
revised in 2005 provides:
1. a third party claim shall be filed
26
within 5 days from the last day of posting or publication of
the notice of execution sale
2. otherwise, the claim shall forever be
barred.
REQUIREMENTS FOR THE THIRD PARTY CLAIMANT:
1. execute an affidavit
2. state his title to the property or right
of possession thereof with supporting evidence
3. shall file the same with the Sheriff
and the Commission or Labor Arbiter
4. The Labor Arbiter who issued the
writ MAY require to adduce additional evidence in support
of his claim and
5. to post a cash or surety bond
equivalent to the amount of his claim
EFFECT OF RECEIPT OF THIRD PARTY CLAIM?
All proceedings, with respect to the execution of
the property subject of such claim, shall automatically be
suspended.
DUTY OF LABOR ARBITER TO RESOLVE THE CLAIM,
WHEN?
Within 10 working days from submission of said
claim for resolution.
4.4 SIMULATED SALE, VOID AB INITIO
Tanongon vs. Samson
FACTS:
Four employees won in their illegal
dismissal case.
The labor arbiter issued a writ of
execution.
The sheriff levied a tanker
purportedly belonging to the employer.
Petitioner Tangonan alleged that he
was the owner of the tanker because it had been sold to
her. Thus, she filed a third-party claim.
ISSUE: W/N the execution can proceed.
HELD:
The CA correctly ruled that the act
of employer Olizon was a cavalier attempt to evade
payment of the judgment debt.
A third-party claim on levied
property does not automatically prevent execution.
Judicial rescission is not necessary
in the case at bar.
Petitioners claim of ownership is not
supported by evidence on record.
The MARINA wrote the parties in
two separate letters and said that the registration of the
disputed vessel under petitioners name had not been
effected, and that the Certificates of Ownership and Vessel
Registry covering motor tanker M/T Petron 7-CI had not
been released.
Insofar as third persons like herein
respondents were concerned, the ownership of the
disputed vessel remained with Olizon and CAYCO.
Thus, CA correctly held that the
NLRC could proceed with the levy and the sale on
execution.
ART. 225. CONTEMPT POWERS OF THE
SECRETARY OF LABOR
In the exercise of his powers under this
Code, the Secretary of Labor may hold any person in
direct and indirect contempt and impose the
appropriate penalties therefor.
TUGADE (pp. 158-170)
Article 226- Bureau of Labor Relations The Bureau of
Labor Relations and the labor relations divisions in the
regional offices of the Department of Labor and
Employment shall have original and exclusive authority
to act, at their own initiative or upon request of either or
both parties, on all inter-union and intra-union conflicts,
and all disputes, grievances or problems arising from or
affecting labor-management relations in all workplaces
whether agricultural or non-agricultural, except those
arising from the implementation or interpretation of
collective bargaining agreements which shall be the
subject of grievance procedure and/or voluntary
arbitration.
1. BLR JURISDICTION AND FUNCTIONS
-The Bureau of Labor Relations (BLR, for brevity) no
longer handles all labor disputes. It is now confined to:
UNION MATTERS, COLLECTIVE BARGAINING
REGISTRY and LABOR EDUCATION (effect of
enactment of E.O. 251, creating the National Conciliation
and Mediation Board, and RA 6715, which expanded
and enhanced the NLRC)
-Functions of BLR, as provided by the Administrative
Code are as follows:
1) set policies, standards and procedures on the
registration and supervision of legitimate labor union
activities including cancellation and revocation of labor
permits
2) set policies, standards and procedures relating to the
collective bargaining agreements and the examination of
financial records of accounts of labor organizations to
determine compliance with relevant laws
3) provide proper orientation to workers on their
schemes and projects for improvement of the standards
of living of workers and their families.
2. INTER UNION AND INTRA UNION DISPUTES; DO
40-03
-"Intra-Union Dispute" refers to any conflict between and
among union members, including grievances arising
from any violation of the rights and conditions of
membership, violation of or disagreement over any
27
provision of the union's constitution and by-laws, or
disputes arising from chartering or affiliation of union.
-"Inter-Union Dispute" refers to any conflict between and
among legitimate labor unions involving
representation questions for purposes of collective
bargaining or to any other conflict or dispute
between legitimate labor unions.
-Inter/intra-union disputes shall include:
(a) cancellation of registration of a labor organization filed
by its members or by another labor organization;
(b) conduct of election of union and workers' association
officers/nullification of election of union and workers'
association officers;
(c) audit/accounts examination of union or workers'
association funds;
(d) deregistration of collective bargaining agreements;
(e) validity/invalidity of union affiliation or disaffiliation;
(f) validity/invalidity of acceptance/non-acceptance for
union membership;
(g) validity/invalidity of impeachment/expulsion of union
and workers association officers and members;
(h) validity/invalidity of voluntary recognition;
(i) opposition to application for union and CBA registration;
(j) violations of or disagreements over any provision in a
union or workers' association constitution and by-laws;
(k) disagreements over chartering or registration of labor
organizations and collective bargaining agreements;
(l) violations of the rights and conditions of union or
workers' association membership;
(m) violations of the rights of legitimate labor
organizations, except interpretation of collective bargaining
agreements;
(n) such other disputes or conflicts involving the rights to
self-organization, union membership and collective
bargaining -
(1) between and among legitimate labor organizations;
(2) between and among members of a union or workers'
association. (Rule XI, DO 40-03)
-Other related labor relations disputes shall include any
conflict between a labor union and the employer or any
individual, entity or group that is not a labor organization or
workers' association. This includes: (1) cancellation of
registration of unions and workers associations; and (2) a
petition for interpleader.
- (WHO MAY FILE) A complaint involving intra/inter
union dispute may be filed by a legitimate labor
organization or its members. Where the issue, however
involves the entire membership, the complaint shall be
supported by at least 30% of the membership. A complaint
involving other related labor relations disputes may be filed
by a party in interest who is not necessarily a union or
union member.
- (WHERE TO FILE) Regardless of the kind of
dispute, if it involves a independent union, chartered local,
or a workers association, the same shall be filed with the
DOLE Regional Office where the labor organization is
registered; if it involves a federation or an industry/national
union, it shall be filed with BLR itself.
-Other procedures are provided by DO 40-03.
2.1 DO 40-03
- the said Department Order4 replaced DO (,
series of 1997. it covers entire subject of labor relations,
except NLRC and comprises the entire Implementing
Rules of Book V of the Labor Code. It also introduces
new concepts such as union merger and union
consolidation and multi employer bargaining.
-it is aimed at the following objectives:
1) simplify the formation and registration of
unions, especially chartered locals
2) simplify and expedite the holding of
certification elections
3) promote responsible unionism, particularly in
the administration of union funds
4) authorize union merger, consolidation and
change of names
5) authorize deregistration of collective
bargaining agreements
2.2 Effect of Pendency
-The status of the parties, i.e., their rights,
obligations and relationships, with respect to each other,
shall continue to remain during the pendency of the
petition and until the date of finality of the decision
rendered therein. Thereafter, their status shall be
governed by the decision. The said pendency is not a
prejudicial question to any PETITION FOR
CETIFICATION ELECTION and shall NOT be a
GROUND FOR DISMISSAL of the said petition or
SUSPENSION for the proceedings thereof.
2.3 Appeal
-Decision is appealable within ten (10) days from
RECEIPT thereof to the BLR if decided by the Med-
Arbiter or Regional Director; to the SOLE if decided by
the BLR in its ORIGINAL JURISDICTION. Appeal shall
be verified under oath and consists of a Memorandum of
Appeal, specifically stating the grounds relied upon.
-Where no appeal is filed, the BLR and Regional
Director or Med-Arbiter shall enter the finality of the
decision in the records of the case and cause the
immediate implementation thereof.
-If an appeal was filed, a reply thereto may be
made within ten days. The SOLE or the BLR has twenty
(20) days to decide the appeal upon receipt of the entire
records of the case. The SOLE or the BLR may call the
parties to a clarificatory hearing in aid of its APPELLATE
JURISDICTION.
-Decision of the SOLE of the BLR shall become
final and executory after ten (10) days from receipt
thereof by the parties unless a motion for its
reconsideration is filed by any party therein within the
same period. Only one MR shall be allowed.
3. EXTENT OF BLRS AUTHORITY
-The same has been described as broad and
expansive. It may hold a referendum election among the
members of a union for the purpose of determining
whether or not they desire to be affiliated with a
federation. But the BLR has no authority to order a
referendum among union members to decide whether to
28
expel or suspend union officers. Neither does the BLR
have authority to forward a case to the Trade Union
Congress of the Philippines for arbitration and decision
which labor organization can truly represent the working
force.
4. KATARUNGANG PAMBARANGAY, NOT
APPLICABLE TO LABOR DISPUTES
-PD 1508 applies only to courts of justice and not
to labor commissions or labor arbitrators offices. It is the
Bureau and its divisions and not the Barangay Lupong
Tagapayapa which are vested by law with the original and
exclusive authority to conduct conciliation and mediation
proceedings on labor controversies before their
endorsement to the appropriate labor arbiter for
adjudication. Requiring conciliation of labor disputes
before barangay courts would defeat the very salutary
purposes of the law. Instead of simplifying labor
proceedings designed at the expeditious settlement of or
referral to the proper court or office to decide it finally,
barangay conciliation would duplicate the conciliation
proceedings and unduly delay the disposition of the labor
case.
Article 227- Compromise agreements Any compromise
settlement, including those involving labor standard laws,
voluntarily agreed upon by the parties with the assistance
of the Bureau or the regional office of the Secretary of
Labor and Employment, shall be final and binding upon the
parties. The National Labor Relations Commission or any
court shall not assume jurisdiction over issues involved
therein except in case of non-compliance thereof or if there
is prima facie evidence that the settlement was obtained
through fraud, misrepresentation, or coercion.
1. COMPROMISE AGREEMENTS
-A fundamental policy of Philippine Labor Law is to
allow parties to find solutions of their own disputes. The
Constitution, it may be recalled, commands the State to
promote the preferential use of voluntary modes of settling
disputes since the maintenance of industrial peace is a
joint responsibility of workers and employers.
-The assistance of the BLR or the Regional Office
of the DOLE in the execution of a compromise settlement
is generally a basic requirement; without it, there can be
no valid compromise settlement. The resulting agreement,
if freely authored by them and not unconscionable or
otherwise unlawful, is legally binding. The NLRC or any
Court shall not assume jurisdiction over issues involved
therein, except: a) in case of noncompliance with the
compromise agreement, or 2) if there is prima facie
evidence that settlement was obtained through fraud,
misrepresentation or coercion.
2. FORMAL REQUIREMENTS OF COMPROMISE
AGREEMENTS
G.R. No. 90519 March 23, 1992
UNION OF FILIPINO WORKERS (UFW), petitioners, vs.
NATIONAL LABOR RELATIONS COMMISSION, SIMEX
INTERNATIONAL INC., LILIA SANTANDER, GEORGE
SANTANDER and JOSEPH SANTANDER, respondents
Agreements must be reduced into writing
and signed in the presence of the Regional Director
or his duly authorized representative. Also, as
provide by the Civil Code, an agent, including a
counsel, must be authorized before he can enter
into a compromise.
3. VALID COMPROMISE AND QUITCLAIM
G.R. No. 87297 August 5, 1991
ALFREDO VELOSO and EDITO LIGUATON petitioners,
vs. DEPARTMENT OF LABOR AND EMPLOYMENT,
NOAH'S ARK SUGAR CARRIERS AND WILSON T. GO,
respondents
The case is about a complaint against the
employer for unfair labor practices. Pending his MR,
after an adverse judgment against him (private
respondent), petitioners signed a quitclaim for an
amount lesser than that awarded in his favor. But later
on, petitioners impugned the said quitclaims on the
ground that they were constrained to sign such
documents because of extreme necessity.
Upon elevation to the Supreme Court, the Court
held that The law looks with disfavor upon quitclaims
and releases by employees who are inveigled or
pressured into signing them by unscrupulous employers
seeking to evade their legal responsibilities. On the other
hand, there are legitimate waivers that represent a
voluntary settlement of laborer's claims that should be
respected by the courts as the law between the parties.
"Dire necessity" is not an acceptable ground for
annulling the releases, especially since it has not been
shown that the employees had been forced to execute
them. It has not even been proven that the
considerations for the quitclaims were unconscionably
low and that the petitioners had been tricked into
accepting them. Not all waivers and quitclaims are
invalid as against public policy. If the agreement
was voluntarily entered into and represents a
reasonable settlement, it is binding on the parties
and may not later be disowned simply because of a
change of mind. It is only where there is clear proof
that the waiver was wangled from an unsuspecting
or gullible person, or the terms of settlement are
unconscionable on its face, that the law will step in
to annul the questionable transaction. But where it
is shown that the person making the waiver did so
voluntarily, with full understanding of what he was
doing, and the consideration for the quitclaim is
credible and reasonable, the transaction must be
recognized as a valid and binding undertaking.
4. COMPROMISE SHOULD BE DULY AUTHORIZED
G.R. No. 105710 February 23, 1995
JAG & HAGGAR JEANS AND SPORTSWEAR
CORPORATION, petitioner, vs. NATIONAL LABOR
29
RELATIONS COMMISSION, LAKAS MANGGA-GAWA SA
JAG, DOMINGO NAMIA, RIZALDE FLORES, JULIETA
ADRIANO, ROBERTO ALAMO, JOSE BALDELOBAR,
LILIBETH BIDES, NARCISO GARBIN, AMELITA
LEBRIAS, MARIBEL MADRID, VERONICA MAGPILI,
IMELDA NEPOMUCENO, AND DAN VILLAMOR,
respondents
The waiver of reinstatement, like waivers of
money claims, must be regarded as a personal right
which must be exercised personally by the workers
themselves. "For a waiver thereof to be legally
effective, the individual consent or ratification of the
workers or employees involved must be shown.
Neither the officers nor the majority of the union had
any authority to waive the accrued rights pertaining to
the dissenting minority members . . . The members of
the union need the protective shield of this doctrine
not only vis-a-vis their employer but also, at times,
vis-a-vis the management of their own union, and at
other times even against their own imprudence or
impecuniousness" We have ruled that ". . . when it
comes to individual benefits accruing to members of a
union from a favorable final judgment of any court, the
members themselves become the real parties in
interest and it is for them, rather than for the union, to
accept or reject individually the fruits of litigation" The
authority to compromise cannot lightly be presumed
and should be duly established by evidence.
We also find no reason for the union members to
enter into a compromise when the decision of NLRC
ordering their reinstatement is more advantageous to them
than their being dismissed from their jobs under said
Compromise Agreement.
The Compromise Agreement does not apply to
private respondents who did not sign the Compromise
Agreement, nor avail of its benefits.
5. RULINGS ON COMPROMISE SETTLEMENTS
SUMMARIZED
G.R. No. 110388 September 14, 1995
ARTEMIO LABOR, PEDRO BONITA, JR., DELFIN
MEDILLO, ALLAN ROMMEL GABUT, and IRENEO
VISABELLA, petitioners, vs. NATIONAL LABOR
RELATIONS COMMISSION, GOLD CITY COMMERCIAL
COMPLEX, INC., and RUDY UY, respondents.
Even if the petitioners did enter into a
compromise settlement with Gold City, such
agreement would be valid and binding only if, per
Veloso, quoting Periquet vs. National Labor Relations
Commission, the agreement was voluntarily entered
into and represents a reasonable settlement of the
claims. In this case, as in Fuentes, the amounts
purportedly received by the petitioners were unreasonably
lower than what they were legally entitled to.
Furthermore, like in Pampanga, the "compromise
settlements" with the petitioners were not executed with
the assistance of the Bureau of Labor Relations or the
Regional Office of the DOLE pursuant to Article 227 of the
Labor Code. The records do not disclose that the
assistance of such office was ever solicited. What Gold
City did was merely to file with the Regional Office of the
DOLE in Davao City the vouchers purporting to show
payments of the alleged considerations of the
"compromise settlements." Such filing can by no stretch
of the imagination be considered as the requisite
assistance in the execution of compromise settlements.
6. WHEN TO EFFECT COMPROMISE: FINAL
DECISION, NEGOTIABLE?
-The old rule was final and executory
judgment cannot be altered and neither can it be
negotiated. Such act is contemptuous and if upheld,
would render the very decision of the Court
meaningless. It manifested a willful disregard of the
authority of the Court as the final arbiter of cases
brought to it. (see 6.1 for the new rule)
Eunika (pp 170-185)
6. WHEN TO EFFECT COMPROMISE: FINAL
DECISION, NEGOTIABLE?
- compromise agreement may be effected at any
stage of the proceeding, even when there is already
a final executor judgment (See Magbanua v. Uy,
below)
- settlement of cases in court: authorized and even
encouraged by express provision of law. Law does
not limit compromises to cases about to be filed or
cases already pending in courts. Compromise may
be effected even after final judgment is impliedly
authorized by article 240.
- No limitation on the right to compromise (i.e. one
claimed by petitioners to exist that there was already
a final executor judgment in favour of petitioners; no
reason for limiting the right of compromise to
pending cases, excluding those already in the
process of execution.
- 1991 decision, Court rendered a contrary
pronouncement: final and executor judgment cannot
be altered and neither can it be negotiated. Such
act is contemptuous and if upheld, would render the
very decision of the Court meaningless. Wilful
disregard of the authority of Court as the final arbiter
of cases brought to it. (Alba Patio de Makati v.
NLRC)
6.1 The definitive Ruling: Magbanua v. Uy
- Court gave a definitive answer in this case: a
compromise agreement covering a case pending
trial, on appeal, or with final judgment, allowed and
valid, except for vices of consent or forgery.
30
CASE: Magbanua, et al. V. Uy G.R. No. 161003, May 6,
2005
Facts:
- SC affirmed an NLRC decision awarding wage
differentials amounting P1.4 M to 8b complainant
workers. Decision became final and executor, thus the
employees asked for a Writ of Execution of the
decision, but before its issuance, the parties reached a
compromise. Both employer and employees filed a
Manifestation requesting that the case be terminated
because the award has been complied with to the
satisfaction of the complainants. It also affirmed that
employees received P40,000 from the employer.
- Employees filed a Motion for Issuance despite signed
affidavit. Employer opposed the motion. Employees
countered, that that only received partial payment.
Employees filed a manifestation again that they
received P320,000; now requesting the case
considered closed
- Labor Arbiter recognized the compromise agreement
and denied the writ of execution and declared the
cases closed. Employees did not stop; they went to
NLRC, which sided the employees and said that final
and executor judgment could not be altered and that
quitclaims and releases are normally frowned upon as
contrary to public policy.
- CA reversed the NLRC, that compromise agreement
may be entered into even after a final judgment, thus
Ees release of their Ers liabilities due to compromise
agreement was valid, SC affirmed, assuming that
agreement was made knowingly and freely.
Ruling:
- Rights may be waived through compromise
agreement, though there was already a final judgment
that has settled the rights of the parties. To be binding,
compromise must be shown to be voluntarily, freely
and intelligently executed by the parties and not
contrary to law, morals, good customs and public
policy.
- Compromise agreement: contract whereby parties
make reciprocal concessions in order to resolve their
differences and thus avoid or put an end to a lawsuit;
adjust their difficulties in a manner they have a agreed
upon disregarding the possible gain and danger of
losing in litigation; may be extrajudicial (to prevent
litigation) or judicial ( to end litigation)
- No justification to disallow compromise agreement.
Validity is determined by compliance with the
requisites and principles of contracts, NOT when it
was entered into. Compromise agreement must have
the following elements
o Consent of the parties
o Object-subject matter of compromise
o Cause of the obligation
- Compromise agreement may be entered into
pending trial, on appeal and with final judgment;
Article 2040 of CC impliedly allowed such
agreements; no limitation when should be entered
- Petitioners and respondent complied with the
elements of a valid contract, thus compromise
agreement is valid.
6.2 Absence of Counsel Remedied
- Labor Arbiters absence when waivers were
executed was remedied when above procedure is
complied. During pre-execution, LA made searching
questions to ascertain that petitioners voluntarily and
freely executed the waivers. Thus LAs absence
when such waivers were executed does not
invalidate them
- Even if contracted without labor officials assistance
compromise agreements bet. Er and Ees are still
valid.
6.3 Reiteration
- Magbanuas Ruling reiterated in Cosmos Bottling v.
Nagrama: parties may execute compromise
agreement even after finality of decision; not
precluded from doing so. Even final and executory
judgment may be compromised; as long as such
right was exercised by proper party litigants
- Court upheld to compromise prior to the execution of
final judgment; final judgment has been novated and
superseded by a compromise agreement;
compromise agreement notwithstanding a final
judgment in which only the amount of backwages
was left to be determined is valid
7. OPTIONS WHEN COMPROMISE AGREEMENT IS
VIOLATED
- Article 2041 (CC): should a party fail or refuse to
comply with the terms of a compromise or amicable
settlement other party could either:
o Enforce the compromise by writ of
execution
o Regard it as rescinded and so insist with
original demand
ART. 228. INDORSEMENT OF CASES TO LABOR
ARBITERS (Repealed by BP 230)
ART. 229. ISSUANCE OF SUBPOENAS
The Bureau shall have the power to require the
appearance of any person or the production of any
31
paper, document or matter relevant to a labor dispute
under its jurisdiction, either at the request of any interested
party or at its own initiative.
ARTICLE. 230. APPOINTMENT OF BUREAU
PERSONNEL
The Secretary of Labor and Employment may appoint, in
addition to the present personnel of the Bureau and the
Industrial Relations Divisions, such number of examiners
and other assistants as may be necessary to carry out the
purpose of the Code.
ART. 231. REGISTRY OF UNIONS AND FILE OF
COLLECTIVE BARGAINING AGREEMENTS.
The Bureau shall keep a registry of legitimate labor
organizations. The Bureau shall also maintain a file of all
collective bargaining agreements and other related
agreements and records of settlement of labor disputes
and copies of orders and decisions of voluntary arbitrators.
The file shall be open and accessible to interested parties
under conditions prescribed by the Secretary of Labor and
Employment, provided that no specific information
submitted in confidence shall be disclosed unless
authorized by the Secretary, or when it is at issue in any
judicial litigation, or when public interest or national
security so requires.
Within thirty (30) days from the execution of a Collective
Bargaining Agreement, the parties shall submit copies of
the same directly to the Bureau or the Regional Offices of
the Department of Labor and Employment for registration,
accompanied with verified proofs of its posting in two
conspicuous places in the place of work and ratification by
the majority of all the workers in the bargaining unit. The
Bureau or Regional Offices shall act upon the application
for registration of such Collective Bargaining Agreement
within five (5) calendar days from receipt thereof. The
Regional Offices shall furnish the Bureau with a copy of
the Collective Bargaining Agreement within five (5) days
from its submission.
The Bureau or Regional Office shall assess the employer
for every Collective Bargaining Agreement a registration
fee of not less than one thousand pesos (P1,000.00) or in
any other amount as may be deemed appropriate and
necessary by the Secretary of Labor and Employment for
the effective and efficient administration of the Voluntary
Arbitration Program. Any amount collected under this
provision shall accrue to the Special Voluntary Arbitration
Fund.
The Bureau shall also maintain a file and shall undertake
or assist in the publication of all final decisions, orders and
awards of the Secretary of Labor and Employment,
Regional Directors and the Commission.
REGISTRY UNIONS AND CBAs
- The Bureau: keep a registry of legitimate labor
organizations
- The Bureau: also maintain a file of all Collective
Bargaining Agreements (CBAs) and other related
agreements
- Parties shall submit within 30 days from execution,
copies of their CBA directly to the BLR or the
Regional Offices of the DOLE for registration.
Registration, though is not a requisite for its validity
- Certification of the CBA by the BLR is not required
for its validity. Once duly entered and signed by the
parties, CBA becomes effective between the parties
regardless whether it has been certified by the BLR
- Liberty Flour Mills Case: registration of the CBA is
needed so that the contract-bar rule under Art. 232
may come into play
ART. 232. PROHIBITION ON CERTIFICATION
ELECTION.
The Bureau shall not entertain any petition for
certification election or any other action which may
disturb the administration of duly registered existing
collective bargaining agreements affecting the parties
except under Articles 253, 253-A and 256 of this Code.
CONTRACT-BAR RULE
- Art. 232 Contract-bar Rule: while a valid and
registered CBA is subsisting, the Bureau is not
allowed to hold an election contesting the majority
status of their incumbent union. The existence of the
CBA does not allow, that is, it bars the holding of the
inter-union electoral contest. Election is legally
allowed (Art. 256), only during the freedom period
last 60 days if the fifth year of a CBA.
- Objective of the rule: minimize union politicking until
the proper time comes.
- Med-Arbiters in the DOLE regional offices are the
ones that hear petitions for the certification election
(Art. 256 and 257)
- Issues related to contract-bar rule and freedom
period discussed in the chapters on collective
bargaining and Ees representation (Arts. 253, 253-A
256)
ART. 233. PRIVILEGED COMMUNICATION.
Information and statements made at conciliation
proceedings shall be treated as privileged
communication and shall not be used as evidence in the
32
Commission. Conciliators and similar officials shall not
testify in any court or body regarding any matters taken up
at conciliation proceedings conducted by them.
Title IV LABOR ORGANIZATIONS
Chapter I: REGISTRATION AND CANCELLATION
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. (As
amended by Batas Pambansa Bilang 130, August 21,
1981 and Section 1, Republic Act No. 9481 which lapsed
into law on May 25, 2007 and became effective on June
14, 2007).
ART 234-A. CHARTERING AND CREATION OF A
LOCAL CHAPTER.
A duly registered federation or national union may directly
create a local chapter by issuing a charter certificate
indicating the establishment of the local chapter. The
chapter shall acquire legal personality only for purposes of
filing a petition for certification election from the date it was
issued a charter certificate.
The chapter shall be entitled to all other rights and
privileges of a legitimate labor organization only upon the
submission of the following documents in addition to its
charter certificate:
(a) The names of the chapters officers, their addresses,
and the principal office of the chapter; and
(b) The chapters constitution and by-laws: Provided,
That where the chapters constitution and by-laws are the
same as that of the federation or the national union, this
fact shall be indicated accordingly.
The additional supporting requirements shall be certified
under oath by the secretary or treasurer of the chapter
and attested by its president. (As inserted by Section 2,
Republic Act No. 9481 which lapsed into law on May 25,
2007 and became effective on June 14, 2007).
ART. 235. ACTION ON APPLICATION.
The Bureau shall act on all applications for registration
within thirty (30) days from filing.
All requisite documents and papers shall be certified
under oath by the secretary or the treasurer of the
organization, as the case may be, and attested to by its
president.
ART. 236. DENIAL OF REGISTRATION; APPEAL.
The decision of the Labor Relations Division in the
regional office denying registration may be appealed by
the applicant union to the Bureau within ten (10) days
from receipt of notice thereof.
ARTICLE 237. ADDITIONAL REQUIREMENTS FOR
FEDERATIONS OR NATIONAL UNIONS
Subject to Article 238, if the applicant for registration is a
federation or a national union, it shall, in addition to the
requirements of the preceding Articles, submit the
following:
(a) Proof of the affiliation of at least ten (10) locals or
chapters, each of which must be a duly recognized
collective bargaining agent in the establishment or
industry in which it operates, supporting the registration
of such applicant federation or national union; and
(b) The names and addresses of the companies where
the locals or chapters operate and the list of all the
members in each company involved.
(ART. 238 [Repealed by EO 111, Dec. 24, 1896]
Conditions for registration of federation or national
unions. No federation if national union shall be
registered to engage in any organizational activity in
more than one industry in any area or region, and no
fed. or national union shall be registered to engage in
any organizational activity in more than one industry all
over the country.
Federation or natnl union which meets the reqs
and conditions may organize and affiliate locals and
chapters w/o registering such locals or chapters with the
Bureau
33
 Locals or chapters shall have the same rights and
privileges as if they were registered in the Bureau,
provided that such fed or ntnl union organizes such locals
or chapters w/in its assigned organizational filed of activity
prescribed by the Sec. of Labor
Bureau see to that fed and national unions shall
only organize locals and chapters w/in a specific industry
or region)
1. LABOR ORGANIZATION; TWO BROAD PURPOSES
- Workers right to self organization: guaranteed under
Art 8, of 1987 Constitution; Art 246 of Labor Code
maintains that, that right shall not be abridged
- That right includes:
o Right to form
o R to join
o R to assist labor organizations for the
purpose of collective bargaining
- Labor Organization: any union or association of
employees in the private sector which exists in whole
or in part for the purpose of collective bargaining,
mutual aid, interest, cooperation, protection, or other
lawful purposes.
- Legitimate Labor Organization: any labor org in the
private sector registered or reported with the Dept in
accordance with Rule 3 and 4 of these Rules
- Union: any labor org in the private sector organized
for collective bargaining and for other legitimate
purposes
- Every union is legitimate; only those properly
registered are considered LLO. Non registration does
not mean it is illegitimate; that it is only unregistered
and has no legal personality. Exists legally but does
not possess the rights of an LLO
- Exclusive Bargaining Representative: legitimate labor
union duly recognized or certified as the sole and
exclusive bargaining representative or agent of all
employees in a bargaining unit
- Workers Association: an association of workers
organized for the mutual aid and protection of its
members or for any legitimate purpose other than
collective bargaining
- Legitimate Workers Association: refers to an
association of workers organized for mutual and
protection of its members or for any legitimates
purpose other than collective bargaining registered
with the Dept in accordance with Rule 3, Sec 2-C
- labor organization not always a union; may be an
association of employees; purpose not nor
necessarily collective bargaining but also dealing
with employers concerning terms and conditions of
employment
1.1 Distinction between Collective Bargaining and
Dealing with Employer
- Purpose of labor org: bargain collectively (as a group
with the employer, and/or some other lawful purpose
- 2 purposes: (1) collective bargaining; (2) dealing with
employer these are concerned with terms and
conditions of employment
- To bargain collectively right that may be acquired
by a labor organization after:
o registering itself with the DOLE; and
o after being recognized by DOLE as the
exclusive bargaining rep (EBR) of the
employees
- Dealing with employer generic description of
interaction bet Er and Ee concerning grievances,
wages and work hours and other terms and
conditions of employment; even if Ees group not
registered with DOLE; this explains why labor org is
not always labor union and why Er-Ee collective
interactions noy always collective bargaining
- Phrase dealing with the Employer involves
bilateral mechanism that entails a pattern or
practice in which a group of Ees, over time, make
proposals to management, and management
responds to those proposals by acceptance or
rejection by word or deed.
Ex. in-house committee; employees benefits and
policy review committees; safety committee and
brainstorming groups these are considered a
labor orgs whose ideas the management may or
may not adopt
- There must be a pattern or practice in which a group
of Ees makes proposals, overtime, to management,
and management responds to such proposals
1.2 Labor Organization Not Necessarily a Union
- Instead of organizing a labor union, workers may opt
to form without the formality if a labor union: labor
management committee. Medium of Er-Ee
interaction in the establishment through which
problems or potential disputes may be resolved by
consensus, compromise or other constructive
voluntary mode.
- The richer the modes of labor-management
interactions, the better.
34
2. CLASSIFICATION OF LABOR ORGANIZATIONS
2.1 At the National Level
- National Union/Federation labor organization with at
least ten locals/chapters or affiliates each of which
must be a duly certified or recognized collective
bargaining agent;
as labor unions in a private establishment organized
for collecting bargaining or for dealing with employers
concerning terms of employment fir their member
unions or for participating the formulation of social and
employment policies and programs with the Bureau
- Industry Union group of legitimate labor
organizations operating within an identified industry,
organized for collective bargaining or for dealing with
Ers concerning terms and conditions of employment
w/in an industry, or for participating in the formulation
of social and employment policies, standards and
programs in such industry, which is duly registered
with the Dept
- Trade Union Center group of natnl unions or
federations organized for the mutual aid and protection
of its members, for assisting such members in
collecting bargaining, or for participating in the
formulation of social and employment policies,
standards and programs
- Alliance aggregation of unions existing in one line of
industry or in a conglomerate, a group of franchisees,
a geographical area, or an industrial center. Different
unions or diff feds may form an alliance to help one
another in the attainment of a particular purpose. Each
member union retains its own organization, structure,
and independence. Alliance cannot represent its
member unions in CBA negotiations
- Company-union labor org which in whole or in part is
Er-controlled or Er-dominated. Art 248 (d) prohibits
being a company union; it must not be confused with a
union (comprised exclusively of the Ees of a given Er,
is free from Er-influence and thus legitimate org
recognized by law as a bona fide labor union,) Also
known as inside union
2.2 At the Enterprise Level
- Labor union either:
o independent if created by independent
registration; or
o chapter if created through chartering
Independent registration is obtained by the union
organizers in an enterprise through their own
action instead of through issuance if a charter by a
federation or national union.
Independent union has a legal personality of its
own not derived from that of a federation; labor
org. operating at the enterprise level that
acquired legal personality through independent
registration under Art 234 of LC; it may affiliate
with a federation or natnl union, in this case,
may be called an affiliate
- Chartering when a duly registered federation or
natnl union issues a charter to a union in an
enterprise and registers the creation of the chapter
with the Regional Office where the applicant
operates
Union recipient of the charter called a chapter or
local or chartered local; legal personality derived
from the federation or national union but it may
subsequently register itself independently
2.3 Recent Changes by RA 9481
- Art 234-A authorizes creation of enterprise-level
unions, one of the many changes of RA 9481. An
Act Strengthening the Workers Constitutional Right
to Self-organization
- The following are the changes:
1. No required member
Independent union 20% registration
requirement
Local Chapter registerable even in its initial
membership is less than 20% of the bargaining
unit.
Company can be quickly unionized by a very
small no of employees
2. Tentative Legal Personality
Local chapter created once federation (same as
national union) issues a charter certificate; it
acquires legal personality to file a petition for CE.
Other union rights will be acquired by submitting the
ff aside from the certificate:
a. Names and addresses of the officers and
members of the union
b. Chapters constitution and by-laws which
can be the same as that of the federation
These documents must be certified under oath
by the Sec or treasures and attested by the
President
3. Specified Grounds of Cancellation
BLR may cancel a union registration based on
grounds under Art. 239
4. PCE Proceeds Despite Petition to Cancel
Union Registration.
Petition to cancel union reg does not prevent the
filing or the hearing of a petition for a CE
35

5. Only Three Grounds to Cancel
a. Falsehood about the CBL
b. Or about the election of officers
c. Voluntary dissolution
6. Cancellation by Action of the Members
At least 2/3 of the membership may vote to
dissolve their organization; this action requires a
subsequent application to cancel to be submitted
by the board of the organization, attested by the
President
7. Reportorial Requirements
Every legitimate labor org has to submit to BLR:
a. Adoption or amendments to constitution
and by-laws (CBL)
b. Election of officers, with list of voters to be
submitted in 30 days
c. Annual financial reports w/in 30 days from
close of fiscal year
d. Annual list of members
Non-submission of these is no longer a ground to
cancel registration, but erring officer may be
punished even by expulsion
8. Affiliation with Same Federation
Supervisors union and rank and file union in same
company may affiliate with same federation.
9. Commingling
Commingling of supervisor and rank and file in
one union is not a ground to cancel union
registration. The excludibe member is
automaticallu deemed removed from the list
10. Non-disclosure even in Unionized Company
In an organized (unionized) enterprise the
federation who files a Petition for Certification
Election (PCE) on behalf of a chapter cannot be
required to identify the chapters officers and
members. PCE does not have to be filed by the
local officers.
11. Non disclosure even in Unionized Company
Non-disclosure rule applies to a federation that
files a PCE on behalf of its chapter in an
enterprise without yet a union as bargaining agent
12. Employer, a Bystander
In a PCE the Er is a bystander and has no right to
oppose the petition. His participation is limited to
being informed about the petition and to being
required to submit the list of employees if a CE will
be held.
Marvin (pp. 185 to 197)
3. REGISTRATION RATIONALE
Legitimate labor organization(LLO) - one registered
with the DOLE. It is clothed with legal personality to
claim representational and bargaining rights(Art.242),
and the right to strike and picket(Art.255).
Unregistered labor organization - not illegimate. It is
lawful but no legal personality: a. to demand CBA; b. to
petition for a certification of election; and c. to hold a
legal strike.
PAFLU vs. Sec. of Labor
The registration prescribed xxx is not a limitation to the
right of assembly or association which may be exercised
with or without said registration. It is only a condition
sine qua non for the acquisition of legal personality by
labor organizations, associations or unions and the
possession of rights and privileges granted by law to
legitimate labor organizations.
3.1 Effect of Registration Under the Corporation Law
Organization under the Corporation Law as a non-stock
corporation and issued a certificate of incorporation by
SEC has only the effect of giving a labor organization
juridical personality before regular courts. It does not
grant the rights and privileges of an LLO.
4. WHERE TO REGISTER
By independent labor unions, chartered locals, and
worker's association
- with the regional office where the applicant
principally operates.
By federations, national unions or worker's
associations operating in more than one region
- shall be filed with the Bureau or Regional
Offices, but shall be processed and acted upon by the
Bureau which has national jurisdiction.
5. REGISTRATION REQUIREMENTS
Under Rule III of the Rules Implementing Book V:
5.1. Federation of National Union
1. a statement indicating the name of the labor
union, its principal address, the names of its officers and
their respective addresses;
2. the minutes of the organizational meeting(s)
and the list of employees who participated in the said
meeting(s);
3. the annual financial reports if the applicant
has been in existence for one or more years, unless it
has not collected any amount from the members, in
which case a statement to this effect shall be included;
4. the constitution and by-laws, minutes of its
adoption or ratification, and the list of the members who
participated in it. Said list shall be dispensed with if the
ratification was done during the organizational
meeting(s). In such a case, the factual circumstances of
the ratification shall be recorded in the minutes of the
said meeting(s);
36
 5. the resolution of affiliation of at least ten(10)
LLO, whether independent unions or chartered locals,
each of which must be a duly certified or recognized
bargaining agent in the establishment where it seeks to
operate; and
6. the name and the addresses of the companies
where the affiliates operate and the list of all the members
in each company involved.
Note: Labor organizations operating within an identified
industry may also apply for registration as a federation or
national union within the specified industry by submitting
the same set of documents.
5.2. Independent Labor Union
1. the name of the applicant labor union, its
principal address, the name of its officers and their
respective addresses, approximate number of employees
in the bargaining unit where it seeks to operate, with a
statement that it is not reported as a chartered local of any
federation or national union;
2. the minutes of the organizational meeting(s)
and the list of employees who participated in the said
meeting(s);
3. the name of all its members comprising at least
20% of the employees in the bargaining unit;
4. the annual financial report if it has been in
existence for one or more years, unless it has not collected
any amount from the members, in which case a statement
to this effect shall be included in the application;
5. the constitution and by-laws, minutes of its
adoption or ratification, and the list of the members who
participated in it. Said list shall be dispensed with where
the constitution and by-laws was ratified or adopted during
the organizational meeting(s). In such a case, the factual
circumstances of the ratification shall be recorded in the
minutes of the organizational meeting(s).
5.3.Worker's Association
1.the name of the applicant association, its
principal address, the name of its officers and their
respective addresses;
2. the minutes of the organizational meeting(s)
and the list of members who participated therein;
3. the financial reports of the applicant association
if it has been in existence for one or more years, unless it
has not collected any amount from the members, in which
case a statement to this effect shall be included in the
application;
4. the constitution and by-laws to which must be attached
the list of names of ratifying members, the minutes of
adoption or ratification of the constitution and by-laws and
the date when ratification was made, unless ratification
was done during the organizational meeting(s), in which
case such fact shall be reflected in the minutes of the
organizational meeting(s).
Note: The application for registration of a worker's
association operating in more than one region shall be
accompanied by a resolution of membership of each
member association, duly approved by its board of
directions.
5.4. Chartered Local
How are unions at the enterprise level created?
1. By Independent Registration; or
2. by Chartering.
Note: A union created through chartering is called a
local, a chapter, or a chartered local in the employer
enterprise where the union officers and members are
employees.
5.4a. Chartered Local has to be Registered;
Requirements
A chartered local has to be registered, not just
reported. D.O. No. 40-B-03 redefines a "chartered local"
as a labor organization in the private sector operating at
the enterprise level that acquired legal personality
through registration with the Regional Office on
accordance with Rule III, Section 2-E of the Rules.
Accordingly, under Section 2-E, a duly registered
federation or national union, directly creating a chartered
local shall submit to the Regional Office 2 copies of the
following:
1. a charter certificate issued by the federation
or national union indicating the creation or establishment
of the local/chapter;
2. the names of the local chapter's officers, their
addresses, and the principal office of the local/chapter;
and
3. 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.
Note; All the foregoing shall be certified under oath by
the Secretary or the Treasurer of the local/chapter and
attested by its President.
5.4b. Legal personality only to File a PCE
Under Article 234-A, as inserted by R.A. No.
9481, it is stated that a chapter acquires legal
personality "on the date it was issued a certificate" by its
mother federation or national union. The acquisition of
legal personality is automatic, but only for the purpose of
filing a petition for certification of election(PCE).
5.4c. Submission of Confirming Documents
The above mentioned acquired personality is
tentative because it needs to be confirmed by
submission of additional documents, otherwise the
chapter does not become entitled to the rights and
privileges of an LLO. However, the law does not fix a
time limit for the submission of the additional documents.
5.4d. A Trade union Center cannot Create a Chapter
As held by the SC, which ruling conforms to
Section 234-A, only registered federations or national
unions may create chapters. (SMCEU vs. SMPPEU;
G.R. No. 171153)
5.4e. When does a chapter becomes an LLO?
The provisions of D.O. No. 9-1997 which
provides that the local/chapter shall acquire legal
personality from the date of filing of the complete
37
documents enumerated in Section 1 thereof was
superseded by D.O. No. 40-03 which states that the labor
organization or workers association shall be deemed
registered and vested with legal personality on the date of
issuance of its certificate of registration.
5.4f. Recognition by BLR not a Ministerial Duty
The shift from date of submission to date of
issuance of certificate of registration is in line with the
court's ruling in 1997 that registration is not a ministerial
function.
Progressive Development Corp.-Pizza Hut vs.
Laguesma, et al., G.R. No. 115077, April 18, 1997
FACTS: The union, Nagkakaisang Lakas ng Manggagawa
(NLM) - Katipunan, filed a petition for certification of the
Progressive development Corporation (Pizza Hut)
Petitioner employer filed a Motion to Dismiss the
petition, alleging fraud falsification and misrepresentation
in the respondent Union's registration, making it void and
invalid. The motion specifically alleged that: a) respondent
Union's registration was tainted with false, forged, double
or multiple signatures of those who allegedly took part in
the ratification of the respondent Union's constitution and
by-laws in the election of its officers; xxx thus, there were
serious falsities in the dates of issuance of the charter
certification and the organization meeting of the alleged
chapter. Citing other instances of misrepresentation and
fraud, petitioner employer filed a Supplement to its Motion
to Dismiss, claiming that : xxx voting was not conducted by
secret ballot in violation of Article 241, Section (c) of the
Labor Code; and that the constitution and by-laws
submitted in support of its petition were not properly
acknowledged and notarized.
Petitioner also filed a petition seeking the
cancellation of the Union's registration on the grounds of
fraud and falsification. Petitioner also filed with the Med-
Arbiter a motion requesting suspension of proceedings in
the certification election case until after the prejudicial
question of the Union's legal personality is determined in
the proceedings for cancellation of registration.
However, the Med-Arbiter directed the holding of a
certification election among petitioner's rank-and-file
employees. An appeal to the office of the Secretary of
Labor was denied, as well as a motion for reconsideration.
In the DOLE Resolution dated December 29, 1993, the
suggestion is made that once a labor organization has filed
the necessary documents and papers and the same have
been certified under oath and attested to, said organization
necessarily becomes clothed with character of a LLO. In
other words, recognition by the Bureau of Labor Relation
becomes merely a ministerial function.
ISSUE: WON recognition by the BLR is a ministerial duty.
HELD: NO. In the first place, the public respondent's views
as expressed in his Resolution miss the entire point behind
the nature and purpose of proceedings leading to the
recognition of unions as legitimate labor organizations
under Article 234 of the Labor Code (LC). The
requirements embodied in the said provision are intended
as preventive measures against the commission of fraud.
After the filing of the necessary documents, it becomes
mandatory for the BLR to check if the requirements
under Article 234 have been sedulously complied with. If
its application for registration is vitiated by falsification
and serious irregularities, especially those appearing on
the face of the application and the supporting
documents, a labor organization should be denied
recognition as a LLO. If a certificate of recognition has
been issued, the propriety of the labor organization's
registration could be assailed directly through
cancellation of registration proceedings in accordance
with Articles 238 and 239 of the LC, or indirectly, by
challenging its petition for the issuance of an order of
certification election.
Note: The present rule under R.A. no. 9481, Article 258-
A, no longer allows an employer to oppose a petition for
CE.
5.4g. Requirements Relaxed
The creation of a local does not need
subscription by a minimum number of members. The
20% initial membership mentioned in article 234(c) is
required to register an independent union but not local.
this makes it easier to create a chapter than an
independent union, thus expediting the growth of
federation or national unions. Such affect records with
the objective, stated in Article 211, to foster a strong and
united labor movement.
In 1992 the SC, applying the Implementing
Rules (IR) at that time, declared that the submission of
books of account was required for a local union to be
properly registered, otherwise the local could not be
considered a LLO.
But in 1997 IR (D.O. No.9) deleted the book of
accounts requirement. Expectedly, the SC held in 1999
that since the D.O. no longer required the presentation
of books of account, a union could be registered without
having to submit such books.
Note: The current IR (D.O. No. 40-03) does not revive
the books of account requirement in registration.
5.5. Union's Legitimacy not Subject to Collateral
Attack
Section 8, Rule IV of D.O. No. 40-03 provides
that the legal personality of a labor union may be
questioned only through an independent petition for
cancellation of union registration in accordance with
Rule XIV of the IR, and not by way of collateral attack in
the petition for CE proceedings under Rule VIII.
6. COLLECTIVE BARGAINING UNIT (CBU)
One of the requirements to register an
independent union is that the applicant should have a
membership of at least 20 % of the employees "in the
bargaining unit where it seeks to operate."
Bargaining Unit(BU)
- 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
38
unit or any specific occupational or geographical grouping
within such employer unit.
Note: A BU is always a group of employees. It may be all
the supervisors or all the rank-and-file in the company, but
the law does not allow supervisors and rank-and-file to
belong to the same BU.
A CBU is different and bigger than a union. Union
members come from the CBU and there can be several
rival unions within a CBU. While officers lead and
represent a union, a union represents a CBU.
7. CONSTITUTION, BY-LAWS, AND REGULATIONS
One of the registration requirements is the
submission of the constitution and by-laws (CBL) of the
applicant union.
Like other voluntary associations, labor unions,
have the right to adopt constitutions, rules and by-laws
within the scope of the lawful purposes of the union and
bind their members thereby, provided they are reasonable,
uniform, and not discriminatory, and provided they are not
contrary to public policy or the law of the land.
A union's constitution and by-laws govern the
relationship between and among its members. As in the
interpretation of contracts, if the terms are clear and leave
no doubt as to the intention of the parties, the literal
meaning of the stipulation shall control.
J&J labor Union-FFW, et al. vs. Director of Labor
Relations, G.R. No. 76427, February 21, 1989
FACTS: The union's constitution and by-laws, reads: "A
member who has been suspended or terminated without
reasonable cause shall be extended a financial aid from
the compulsory contributions in the amount of seventy-five
centavos from each member weekly.
Oscar, a member of the union, was dismissed by
his employer because in his job application form he did not
state that he had a relative in the company, in violation of
the company policies. When the union refused to provide
him the financial aid mentioned in the union's constitution,
Oscar filed a complaint against the union. When the BLR
ordered the grant of financial aid, the union contended that
such order is tantamount to compelling the union to
disburse its fund without the authority of the general
membership and to collect from its members without the
required individual authorizations.
ISSUE: WON individual authorizations from the members
are still needed for the grant of financial aid.
HELD: NO. The nature of the said contribution being
compulsory, and the fact that the purpose as stated is for
financial aid, clearly indicate that individual payroll
authorizations of the union members are not necessary.
The union's constitution and by-laws govern the
relationship between and among its members. The union
can be ordered to release its fund intended for the
promotion of mutual assistance in favor of private
respondent.
SOME REASONS FOR JOINING A UNION
1. Need to improve conditions.
2. Discontent with wages.
3. Inadequate benefits.
4. No feeling of justice.
5. Insecurity.
6. Poor Supervision.
7. Lack of communication.
7.1 Limitations to by-laws
1. It must not be intended to commit wrong;
2. It must not authorize interference with the
constitutional rights of others; and
3. It must be democratically ratified.
7.2 Amendments
It may be amended under the laws of the state,
and in the absence of other requirements, it may be
amended y a majority vote of the members.
8. PROVISIONS COMMON TO THE REGISTRATION
OF LBOR ORGANIZATIONS AND WORKER'S
ASSOCIATION
8.1. Attestation, Fee, Copies of Documents
The application for registration, notice for
change of name, merger, consolidation and affiliation
including all the accompanying documents, shall be
certified under oath by its Secretary or Treasurer, as the
case may be, and attested by its President.
Both shall be issued a certificate of registration
upon payment of the prescribed registration fee.
One original copy and two duplicate copies of all
documents accompanying the application or notice shall
e submitted to the Regional Office or the bureau.
8.2. Action on the Application/Notices
The Regional Office or the Bureau, as the case
may be, shall act on all the applications for registration
or notice of change of name, affiliation, merger and
consolidation within ten days from receipt either by: a)
approving the application and issuing the certificate of
registration/acknowledging the notice /report; or b)
denying the application/notice for failure of the applicant
to comply with the requirements for registration/notice.
8.3. Denial of Application/Return of Notice
Where the documents supporting the application
for registration/notice of change of name, affiliation,
merger and consolidation are incomplete or do not
contain the required certification and attestation, the
Regional Office or the Bureau shall, within five days from
receipt of the application/notice, notify the applicant in
writing of the necessary requirements and complete the
same within thirty days from receipt of notice. Where the
applicant fails to comply, the application shall be denied,
or the notice of change of name, affiliation, merger and
consolidation returned, without prejudice to filing a new
application or notice.
The order denying the application for
registration/ returning the notice of change of name,
affiliation, merger or consolidation shall be in writing,
stating in clear terms the reasons for the denial or return.
39
8.4. Appeal
Where to appeal?
1. The denial of the Regional Office may be
appealed to the Bureau and then to the Court of Appeals.
2. If the denial originated at the Bureau itself, the
appeal is to the Secretary of Labor.
Period:
Should be filed within ten(10) days from receipt
of such notice, on the ground of grave abuse of
discretion or violation of the rules.
Note: The memorandum of appeal shall be filed with the
Regional Office or the Bureau that issued the denial/return
of notice.
The memorandum together with the records shall
be transmitted by the Regional Office to the Bureau, or by
the Bureau to the Office of the Secretary, within twenty-
four(24) hours from receipt of the memorandum of
appeal.
The Bureau or the Office of the Secretary shall
decide the appeal within twenty(20) days from receipt of
the records of the case.
MALEN- 197(9)-211(1.3)
9. AFFILIATION
*An affiliate is an independently registered union that
enters into an agreement of affiliation with a federation or
national union;
- also refers to a chartered local which applies for and is
granted an independent registration but does not
disaffiliate from its mother federation or national union.
Reasons for affiliation:
-to secure support or assistance
-to utilize expertise in preparing bargaining proposals
-to marshal manpower
*A federation or national union ceases as such when it
loses its locals. (see Arts. 237 and 238)
*The relationship between a local chapter and a labor
federation or national union is generally understood to be
that of agency, where the local is the principal and the
federation the agent.
*Affiliation by a duly registered local union with a national
union or federation does not make the local union lose its
legal personality.
9.1 Report of Affiliation; Requirements
*An independently registered union affiliating with a
federation or national union is required to report such
affiliation. The report shall be filed with the Regional Office
that issued its certificate of registration.
*It shall be accompanied by the ff. Documents:
a) Resolution of the Board of Directors approving the
affiliation
b) Minutes of general membership meeting
approving affiliation
c) Total number of members comprising the labor
union and the names of members who approved
the affiliation
d) Certificate of affiliation issued by the federation
e) Written notice to employer concerned if the
affiliating union is the incumbent bargaining
agent.
10. DISAFFILIATION
*The local unions remain the basic units of association,
free to serve their own interests subject to the restraints
imposed by the constitution and by-laws of the national
federation, and free also to renounce the affiliation upon
the terms laid down in the agreement which brought
such affiliation into existence.
*In other words, to disaffiliate is a right, but to
observe the terms of affiliation is an obligation.
*This right is consistent with the constitutional guarantee
of freedom of association.
*The pendency of an election protest involving both the
mother federation and the local union did not constitute a
bar to a valid disaffiliation. As the local union had validly
disaffiliated, the employer could validly affiliate with
another federation. (Skylanders vs. NLRC)
*Neither is the disaffiliation from the federation, alleged
as an act of disloyalty, a sufficient ground for dismissal
from employment. It may sever its affiliation at any time
and such disaffiliation cannot be considered disloyalty in
the absence of specific provisions in the federations
constitution prohibiting disaffiliation. (MSMG-UWP vs.
Ramos)
Cases:
Liberty Cotton Mills Workers Union vs. Liberty
Cotton Mills, Inc.
Facts: In their CBA, the company recognized the local
union, represented by PAFLU, as the sole bargaining
agent. While the CBA was still in force, 32 out of 36
members of the union disaffiliated from PAFLU, the
mother federation. PAFLU requested the company to
terminate the employment of the employees which the
company did.
Held: The dismissal from employment was not justified.
PAFLU, acting for and in behalf of its affiliate, had the
status of an agent while the local union remained the
basic unit of the association free to secure the common
interest of all its members.
The constitution and by-laws provided that the
local union should remain an affiliate as long as 10 or
more of the members evidence their desire to continue
40
the affiliation. As only 4 did not sign the resolution for
disaffiliation, the intent to disaffiliate was manifest.
Tropical Hut Employees Union-CGW, et. al. Vs.
Tropical Hut Food Market, Inc.
There is nothing in the constitution of the NATU or
in the constitution of the THEU-NATU that the THEU was
expressly forbidden to disaffiliate from the federation.
The alleged noncompliance of the local union with
the provision in the NATU constitution requiring the service
of 3months notice of intention to withdraw did not produce
the effect of nullifying the disaffiliation for the ff. grounds:
(1)NATU was not a legitimate labor organization and (2)
the act of noncompliance with the procedure on withdrawal
is premised on purely technical grounds which cannot
defeat the fundamental right of self-organization.
*In the absence of enforceable provisions in the
federations constitution preventing disaffiliation of a local
union, a local may sever its relationship with its parent.
10.1 Local Union is the Principal; Federation, the
Agent
The NATU possessed the status of an agent while
the local union remained the basic principal union which
entered into contract with respondent company. When the
THEU disaffiliated from its mother federation, the former
did not lose its legal personality as the bargaining union
under the CBA. (Tropical Hut case)
*Disaffiliation of employees from their mother union and
their formation into a new union do not terminate their
status as employees of the corporation, as the employees
and members of the local union did not form a new union
but merely exercised their right to register their local union.
A local union when circumstances so warrant is free to
disaffiliate from its mother union.
10.2 When to Disaffiliate
-only when warranted by circumstances.
*Generally, a labor union may disaffiliate from the mother
union to form a local or independent union only during the
60-day freedom period immediately preceding the
expiration of the CBA.
*The freedom period refers to the last 60 days of the fifth
and last year of a CBA. (see Art. 256)
*But even before the onset of the freedom period,
disaffiliation may still be carried out but such disaffiliation
must be effected by a majority of the members in the
bargaining unit.
>>> Azucena believes that this is only true if the
contract of affiliation does not specify the period for
possible disaffiliation. If it does, the stipulation must be
observed.
10.3 Disaffiliation must be by Majority Decision
* Art. 241(d) it has to be decided by the entire
membership through secret balloting.
*A member or any number of members may
disaffiliate from their union during the freedom
period. BUT disaffiliating the union itself from the
mother union must be supported by the majority of
members.
If done by a minority, even during the freedom
period the act may constitute disloyalty. The minority
members breaking away at the wrong time may be
expelled from the union and because of the union
security clause, may be removed from their employment.
Case:
Villar, et al. vs. Inciong
Had petitioners (disaffiliating union members)
merely disaffiliated from the Amigo Employees Union-
PAFLU, there could be no legal objections thereto for it
was their right to do so. But what petitioners did by the
very clear terms of their Sama-samang Kapasiyahan
was to disaffiliate the Amigo Employees Union-PAFLU
from the PAFLU, an act which they could not have done
with any effective consequence because they
constituted the minority in the Amigo Employees Union-
PAFLU.
Neither is there merit to petitioners contention
that they had the right to present representation issues
within the 60-day freedom period. The petition was filed
in the name of the Amigo Employees Union which had
not disaffiliated from PAFLU, the mother union.
Petitioners being a mere minority of the local
union may not bind the majority members of the local
union.
10.4 Disaffiliation: Effect on Legal Status
*When a union which is not independently registered
disaffiliates from the federation, it is not entitled to the
rights and privileges granted to a legitimate labor
organization. It cannot file a petition for certification
election.
10.5 Disaffiliation: Effect on Union Dues
*The obligation of an employee to pay union dues is
coterminous with his affiliation. The employees check-off
authorization, even if declared irrevocable, is good only
as long as they remain members of the union
concerned.
10.6. Disaffiliation; Effect on Existing CBA; the
Substitutionary Doctrine
*The CBA continues to bind the members of the new or
disaffiliated and independent union up to the CBAs
expiration date.
41
*The SUBSTITUTIONARY DOCTRINE provides that the
employees cannot revoke the validly executed collective
bargaining contract with their employer by the simple
expedient of changing their bargaining agent. The new
agent must respect the contract. They can only negotiate
with the management for the shortening thereof.
11. REVOCATION OF CHARTER
* A federation may revoke the charter issued to a local by
serving on the latter a verified notice of revocation, copy
furnished to the Bureau on the ground of disloyalty or other
grounds specified in the by-laws.
-shall divest the local chapter of its legal personality upon
receipt of the notice by the Bureau unless the local chapter
has acquired independent registration.
11.1 Effect of Cancellation of Registration of
Federation or National Union on Locals/Chapters
-shall operate to divest its locals of their status as
legitimate labor organizations unless the locals are
covered by a duly registered CBA. In the latter case, the
locals shall be allowed to register as as independent
unions, failing which they shall lose their legitimate status
upon the expiration of the CBA.
12. MERGER OR CONSOLIDATION
MERGER of labor organizations- is the process where a
labor organization absorbs another, resulting in the
cessation of the absorbed labor organizations existence
and the continued existence of the absorbing labor
organization.
Effect: to transfer to the absorbing organization all the
rights, interest and obligations of the absorbed
organization.
CONSOLIDATION of unions- refers to the creation and
formation of a new union arising from the unification of the
two or more unions.
Effect: the newly created labor organization acquires all
the rights, interests and obligations of the consolidating
labor organizations.
Distinction:
*Consolidation usually occurs between two unions that are
approximately the same size, whereas merger often
involves larger union merging with a smaller union.
Why do unions merge?
-to gain access to greater resources and expertise
-to eliminate interorganizational conflicts
-to maintain job security and institutional survival.
12.1 Notice of Merger/Consolidation of Labor
Organizations; Where to File
*Notice of merger or consolidation of independednt labor
unions, chartered locals and workers associations
-Regional Office that issued the certificate of
registration/certificate of creation of chartered local of
either the merging or consolidating labor organization.
*Notice of merger/consolidation of federations or national
unions
-Bureau
12.2. Requirements of Notice of
Merger/Consolidation
a) Minutes of convention or general meetings of all
merging/consolidating labor organizations with
list of members who approved the same
b) Amended constitution and by-laws and minutes
of its ratification
12.3. Certificate of Registration
-shall bear the registration number of one of the merging
labor organizations as agreed upon by the parties.
-shall indicate the ff:
a) New name
b) The fact that it is a merger/consolidation of two
or more labor organizations
c) Name of labor organizations that were merged
or consolidated
d) Office or business address
e) Date when each of the labor organizations
acquired legitimate personality
13. CHANGE OF NAME
-Notice shall be filed with the Bureau or the Regional
Office, accompanied by proof of approval of change of
name and amended constitution and by-laws.
13.1 Effect of Change of Name
-legal personality is not affected.
-all rights and obligations of a labor organization under
its old name shall continue to be exercised.
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. 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.
42
In case of cancellation, nothing herein shall restrict the
right of the union to seek just and equitable remedies in
the appropriate courts."
"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.
ART. 239-A. Voluntary Cancellation of Registration. - The
registration of a legitimate labor organization may be
cancelled by the organization itself. Provided, That at least
two-thirds of its general membership votes, in a meeting
duly called for that purpose to dissolve the
organization: Provided, further, That an application to
cancel registration is thereafter submitted by the board of
the organization, attested to by the president thereof.
1.CANCELLATION OF REGISTRATION; GROUNDS
-Cancellation is the governments act that divests the
organization of its status as legitimate labor organization.
- Although it does not cease to exist or become unlawful
organization, its juridical personality as well as its statutory
rights and privileges is suspended. It loses entitlement to
the rights enumerated in Art. 242.
Requisites for THIRD ground: (By the desire of the
union members themselves)
1. Desire to dissolve-voted upon through secret
balloting
2. Balloting should take place in a meeting duly
called for this purpose
3. 2/3 affirmative vote of the general membership,
not just of the quorum.
4. Application for cancellation passed and submitted
by the unions governing board which application
must be attested to by the president.
1.1 Invalid Grounds
-illegal strike
-nonrenewal of registration/permit (provided it has juridical
personality when it filed the petition and the court acquired
jurisdiction)
1.2 Cabo and other Grounds Deleted
Cabo- refers to a person or group of persons or to a
labor group which, in the guise of a labor organization,
supplies workers to an employer, with or without any
monetary or other consideration whether in the capacity
of an agent of the employer or as an ostensible
independent contractor.
Also deleted:
*Sweetheart Contract- CBA which provides for terms and
conditions of employment below minimum standards
established by law.
*Asking for or accepting attornerys fees or negotiation
fees from employer- but this cause of union cancellation
still exists because Art.249 prohibits it as ULP.
*Violation of Art.241- if 30% of the members support the
petition
*Failure to submit annual documentary reports- taken-up
under Art.242-A.
1.3. Administrative Cancellation; The Reportorial
Requirements
Failure of the labor organization to submit the ff. reports
for 5 consecutive years authorized the Bureau to
institute cancellation proceedings upon its own initiative
or upon complaint by any party-in-interest:
1. Any amendment to its constitution and by-laws
within 30 days from its adoption
2. Annual financial reports within 30 days after the
close of each fiscal year or calendar year.
3. Updated list of newly-elected officers together
with the appointive officers or agents entrusted
with the handling of funds, within 30 days after
each regular or special election of officers or
from the occurrence of any change in the
officers
4. Updated list of individual members of chartered
locals, independent unions and workers
associations, within 30 days after the close of
each fiscal year; and
5. Updated list of its chartered locals and affiliates
or member organization, CBAs executed and
their effectivity period in the case of federations
or national unions, within 30 days after the
close of each fiscal year, as well as updated list
of their authorized representatives, agents or
signatories in the different regions of the country.
The fiscal year shall coincide with the calendar year,
unless a different period is prescribed in the
constitution or by-laws.
43
Ramil 211 (2) - 226 (end of Ferrer)

2.) WHO FILES PETITION FOR CANCELLATION OF

UNION REGISTRATION

General Rule: Any party-in-interest, example: employer

Exception: Violations of Art. 241 which can only be
commenced by members of the labor organization
concerned.
Petition to cancel must be:
a.) under oath;
b.) state clearly and concisely the facts and grounds; and
c.) accompanied by a proof of service.

3.) WHERE TO FILE PETITION

Regional Director
- Legitimate independent labor union, chartered
local, and workers association.

Bureau
- Federations, national or industry unions and trade
unions upon the filing of an independent complaint
or petition for cancellation.

Appeals
Regional Director BLR CA (through certiorari)
BLR- DOLE Sec. CA (through certiorari)

4.) PROCEDURE
Art. 226, 242-A

Article 240. Equity of the incumbent. All existing

federations and national unions which meet the
qualifications of a legitimate labor organization and none of
the grounds for cancellation shall continue to maintain their
existing affiliates regardless of the nature of the industry
and the location of the affiliates.

44
Chapter II
RIGHTS AND CONDITIONS OF MEMBERSHIP
Article 241. Rights and conditions of membership in a
labor organization. The following are the rights and
conditions of membership in a labor organization:
(a) No arbitrary or excessive initiation fees shall be
required of the members of a legitimate labor organization
nor shall arbitrary, excessive or oppressive fine and
forfeiture be imposed;
(b) The members shall be entitled to full and detailed
reports from their officers and representatives of all
financial transactions as provided for in the constitution
and by-laws of the organization;
(c) The members shall directly elect their officers, including
those of the national union or federation to which they or
their union is affiliated, by secret ballot at intervals of five
(5) years. No qualification requirements for candidacy to
any position shall be imposed other than membership in
good standing in subject labor organization. The secretary
or any other responsible union officer shall furnish the
Secretary of Labor and Employment with a list of the
newly-elected officers, together with the appointive officers
or agents who are entrusted with the handling of funds,
within thirty (30) calendar days after the election of officers
or from the occurrence of any change in the list of officers
of the labor organization; (As amended by Section 16,
Republic Act No. 6715, March 21, 1989).
(d) The members shall determine by secret ballot, after
due deliberation, any question of major policy affecting the
entire membership of the organization, unless the nature
of the organization or force majeure renders such secret
ballot impractical, in which case, the board of directors of
the organization may make the decision in behalf of the
general membership;
(e) No labor organization shall knowingly admit as
members or continue in membership any individual who
belongs to a subversive organization or who is engaged
directly or indirectly in any subversive activity;
(f) No person who has been convicted of a crime involving
moral turpitude shall be eligible for election as a union
officer or for appointment to any position in the union;
(g) No officer, agent or member of a labor organization
shall collect any fees, dues, or other contributions in its
behalf or make any disbursement of its money or funds
unless he is duly authorized pursuant to its constitution
and by-laws;
(h) Every payment of fees, dues or other contributions by a
member shall be evidenced by a receipt signed by the
officer or agent making the collection and entered into the
record of the organization to be kept and maintained for
the purpose;
(i) The funds of the organization shall not be applied for
any purpose or object other than those expressly provided
by its constitution and by-laws or those expressly
authorized by written resolution adopted by the majority of
the members at a general meeting duly called for the
purpose;
(j) Every income or revenue of the organization shall be
evidenced by a record showing its source, and every
expenditure of its funds shall be evidenced by a receipt
from the person to whom the payment is made, which
shall state the date, place and purpose of such payment.
Such record or receipt shall form part of the financial
records of the organization.
Any action involving the funds of the organization shall
prescribe after three (3) years from the date of
submission of the annual financial report to the
Department of Labor and Employment or from the date
the same should have been submitted as required by
law, whichever comes earlier: Provided, That this
provision shall apply only to a legitimate labor
organization which has submitted the financial report
requirements under this Code: Provided, further, that
failure of any labor organization to comply with the
periodic financial reports required by law and such rules
and regulations promulgated thereunder six (6) months
after the effectivity of this Act shall automatically result in
the cancellation of union registration of such labor
organization; (As amended by Section 16, Republic Act
No. 6715, March 21, 1989).
(k) The officers of any labor organization shall not be
paid any compensation other than the salaries and
expenses due to their positions as specifically provided
for in its constitution and by-laws, or in a written
resolution duly authorized by a majority of all the
members at a general membership meeting duly called
for the purpose. The minutes of the meeting and the list
of participants and ballots cast shall be subject to
inspection by the Secretary of Labor or his duly
authorized representatives. Any irregularities in the
approval of the resolutions shall be a ground for
impeachment or expulsion from the organization;
(l) The treasurer of any labor organization and every
officer thereof who is responsible for the account of such
organization or for the collection, management,
disbursement, custody or control of the funds, moneys
and other properties of the organization, shall render to
the organization and to its members a true and correct
account of all moneys received and paid by him since he
assumed office or since the last day on which he
rendered such account, and of all bonds, securities and
other properties of the organization entrusted to his
custody or under his control. The rendering of such
account shall be made:
(1) At least once a year within thirty (30) days after the
close of its fiscal year;
(2) At such other times as may be required by a
resolution of the majority of the members of the
organization; and
(3) Upon vacating his office.
The account shall be duly audited and verified by
affidavit and a copy thereof shall be furnished the
Secretary of Labor.
(m) The books of accounts and other records of the
financial activities of any labor organization shall be
45
open to inspection by any officer or member thereof during
office hours;
(n) No special assessment or other extraordinary fees may
be levied upon the members of a labor organization unless
authorized by a written resolution of a majority of all the
members in a general membership meeting duly called for
the purpose. The secretary of the organization shall record
the minutes of the meeting including the list of all members
present, the votes cast, the purpose of the special
assessment or fees and the recipient of such assessment
or fees. The record shall be attested to by the president.
(o) Other than for mandatory activities under the Code, no
special assessments, attorneys fees, negotiation fees or
any other extraordinary fees may be checked off from any
amount due to an employee without an individual written
authorization duly signed by the employee. The
authorization should specifically state the amount, purpose
and beneficiary of the deduction; and
(p) It shall be the duty of any labor organization and its
officers to inform its members on the provisions of its
constitution and by-laws, collective bargaining agreement,
the prevailing labor relations system and all their rights and
obligations under existing labor laws.
For this purpose, registered labor organizations may
assess reasonable dues to finance labor relations
seminars and other labor education activities.
Any violation of the above rights and conditions of
membership shall be a ground for cancellation of union
registration or expulsion of officers from office, whichever
is appropriate. At least thirty percent (30%) of the
members of a union or any member or members specially
concerned may report such violation to the Bureau. The
Bureau shall have the power to hear and decide any
reported violation to mete the appropriate penalty.
Criminal and civil liabilities arising from violations of above
rights and conditions of membership shall continue to be
under the jurisdiction of ordinary courts.
1.) DEMOCARATIZATION OF UNIONS
The aim of unionism is to install industrial democracy, the
unions themselves must be democratic. This is the
rationale behind Art. 241.
2.) NATURE OF RELATIONSHIP BETWEEN UNION AND
ITS MEMBERS
The relationship is fiduciary in nature and arises out of two
factors: one is the degree of dependence of the individual
employee on the union organization and the other is the
comprehensive power vested in the union with respect to
the individual.
2.1 Duty of Court to Protect Laborers from Unjust
Exploitation by Oppressive Employers and Union
Leaders
The Court must be vigilant to protect the individual interest
of the union members.
3. RIGHTS OF UNION MEMBERS
1.) Political right- right to vote and be voted for;
2.) Deliberation and decision making right- right to
participate in deliberations on major policy questions and
decide them by secret ballot.
3.) Rights over money matters- the members right
against excessive fees; right against unauthorized
collection of contribution or unauthorized disbursements;
right to require adequate records of income and
expenses and right of access to financial records; right
to vote on officers compensation; right to vote on
proposed special assessments and be deducted a
special assessment only with the memberss written
authorization.
4.) Right to information- right to be informed about the
organizations constitution, by-laws, collective bargaining
agreement and labor laws.
5.) Right to present grievances to the employer at any
time.
3.1 Eligibility for Membership
An employee is already qualified for union membership
starting on his first day of service. An employees
membership in a union, does not necessarily mean
coverage of the CBA, if one exists. Inclusion in the CBU
depends on the determination of its appropriateness
under Art. 234 and Art. 255. Inclusion or membership in
a union depends on the union constitution and by-laws,
without prejudice to Art. 277 (c ). Inclusion or coverage in
the CBA depends on the stipulation in the CBA itself.
4. ELECTION OF UNION OFFICERS
Election is through secret ballot. It takes place at a 5
year interval.
What positions to fill up, where, and how the election
should be done are matters left by law to the unions
constitution and by-laws or to agreement among
members. Only in the absence thereof will the
Implementing Rules of Book V apply. Under the Rules,
the incumbent president is required to create an election
committee within 60 days before expiration of the
incumbent officers term.
If the officers with expired term do not call an election,
the remedy is for at least 30% of the members to file a
petition with the DOLE Regional Office.
UST Faculty Union, et al. vs. Bitonio, Jr., et al., G.R.
No.131235, November 16. 1999
Facts: Petitioners claim numerous anomalies allegedly
committed by the union officers impelled them to elect a
new set of USTFU officers before the end of the term of
the incumbents. They assert that such was pursuant to
their right to self-organization.
The Med-Arbiter of DOLE declared the election null and
void on the ground that the election was initiated and
46
conducted not in accordance with the unions constitution
and by-laws. On appeal, the BLR Director upheld the Med-
Arbiters decision.
Issue: Whether or not the petitioners election of a new set
of officer before the end of term of the incumbents is a
proper exercise of their right to self organization?
Ruling: No. Petitioners' frustration over the performance of
private respondents, as well as their fears of a "fraudulent"
election to be held under the latter's supervision, could not
justify the method they chose to impose their will on the
union. Director Bitonio aptly elucidated:
The constitutional right to self-organization is better
understood in the context of ILO Convention No. 87
(Freedom of Association and Protection of Right to
Organize), to which the Philippines is signatory. Article 3 of
the Convention provides that workers' organizations shall
have the right to draw up their constitution and rules and to
elect their representatives in full freedom, free from any
interference from public authorities. The freedom conferred
by the provision is expansive; the responsibility imposed
on union members to respect the constitution and rules
they themselves draw up equally so. The point to be
stressed is that the union's CBL is the fundamental law
that governs the relationship between and among the
members of the union. It is where the rights, duties and
obligations, powers, functions and authority of the officers
as well as the members are defined. It is the organic law
that determines the validity of acts done by any officer or
member of the union. Without respect for the CBL, a union
as a democratic institution degenerates into nothing more
than a group of individuals governed by mob rule
4.1 Eligibility of Voters
-Only members of the union can participate in the election
of union officers.
-A member in good standing is any person who has
fulfilled the requirements for membership in the union and
who has neither voluntarily withdrawn from membership
nor had been expelled or suspended from membership
after appropriate proceedings consistent with lawful
provision of the unions constitution and by-laws.
Rights of a labor organization in the eligibility of voters:
1.) The labor organization may prescribe reasonable rules
and regulations with respect to voting eligibility.
2.) A labor may condition the exercise of the right to vote
on the payment of dues
Reason: since paying dues is a basic obligation of
membership.
Rules to be followed: a.) any rule denying dues-delinquent
members the right to vote must be applied uniformly;
2.)members must be afforded a reasonable opportunity to
pay dues, including a grace period during which dues may
be paid without any loss of rights.
The question of eligibility is the applicable payroll period
and the employees status during the applicable period.
It is the payroll of the month preceding the labor dispute
in case of regular employees and the payroll period at or
near the peak of operations in case of employees in
seasonal industries.
If none of the contending unions insisted on the use of
the payroll period-list as voting list, the act of the
nonunion employees of joining the election by casting
their votes is a clear manifestation of their intention to
join a union.
Members can vote in the election of unions officers
even if their name is not submitted to the BLR.
4.2 Union Officer Must Be an Employee
Art. 241 ( c) provides that xxx no qualification
requirements for candidacy to any position shall be
imposed other than membership in good standing in
subject labor organization.
An individual who is a member of a subversive
organization or engaged directly or indirectly in
subversive activity cannot be a union member.
4.3 Disqualification of Union Officers
A union member is disqualified to run as union officer if
he is convicted of a crime of moral turpitude.
A crime of moral turpitude is one characterized by an act
of baseness, vileness or depravity in the private or social
duties which a man owes his fellowmen, or to society in
general, contrary to accepted and customary rule of right
and duty between man and man, or conduct contrary to
justice, honesty, modesty, or good morals.
4.4 Union Election Protest; Proclamation of Winners
Provided under Rule XI of D.O. No. 40-03.
5. ACTION AGAINST UNION OFFICERS
Past malfeasance or misfeasance of a union officer after
his election is not a ground for expulsion from the union.
The remedy against erring union officers is not
referendum but union expulsion. The reason is that
where the people have elected a man to office, it must
be assumed that they did this with the knowledge of his
life and character and that they disregarded or forgave
his faults or misconduct if he had been guilty of any.
6. DUE PROCESS IN IMPEACHMENT
Litton Mills Employees Association- Kapatiran vs. Ferrer-
Calleja
The impeachment of a union officer is provided under
Section 2, Article XV of the petitioner-unions constitution
and by-laws provided the procedure to be followed:
47
1.) Impeachment should be initiated by petition signed by
at least 30% of all bona fide members of the union, and
addressed to the Chairman of the Executive Board;
2.) A general membership meeting shall be convened by
the Board Chairman to consider the impeachment of an
officer;
3.) Before any impeachment vote is finally taken, the union
officer against whom impeachment charges have been
filed shall be given ample opportunity to defend himself;
4.) A Majority of all the members of the union shall be
required to impeach or recall union officers.
7.) EXPULSION OF MEMBERS
A member is entitled to due process.
Ferrer, et al. vs. NLRC, G.R. No. 100898, July 5, 1993
Facts: Petitioner and companions filed with the
Department of Labor a complaint seeking the expulsion
from SAMAHAN of its officers headed by president Capitle
allegedly because the officers failed to attend to the
economic demands of the workers. Petitioner and
companions then elected a new set of officers which was
objected by the FFW, the federation. The employer did nit
remit any dues to the officers led by Capitle. As a result,
the union headed by Capitle expelled Ferrer, et al, from the
union and demanded from the company the termination of
their employment. At the time they were dismissed they
had been regular OFC employees for 10 years.
Ferrer and his four companions turned to the Federation of
Democratic Labor Unions (FEDLU) and requested that
they be represented (katawanin) by said federation
before the DOLE in the complaint which they intended to
file against the union (SAMAHAN), the FFW, and the
company.
Issue: Whether or not Ferrer and his four companions
were illegally dismissed without due process of law?
Held: Yes. In the first place, the union has a specific
provision for the permanent or temporary "expulsion" of its
erring members in its constitution and by-laws ("saligang
batas at alituntunin").
No hearing ("pandinig") was ever conducted by the
SAMAHAN to look into petitioners' explanation of their
moves to oust the union leadership under Capitle, or their
subsequent affiliation with FEDLU. While it is true that
petitioners' actions might have precipitated divisiveness
and, later, showed disloyalty to the union, still, the
SAMAHAN should have observed its own constitution and
by-laws by giving petitioners an opportunity to air their side
and explain their moves. If, after an investigation the
petitioners were found to have violated union rules, then
and only then should they be subjected to proper
disciplinary measures.
TINA (pp.226-239)
8. RELIEF WITHIN THE UNION
GR: relief must first be sought within the union itself
in accordance with its constitution and by-laws.
In the case of Diamonon v. DOLE where a complaint
filed by the union VP against the president and
treasurer of 2 unions was filed directly with DOLE
instead of being presented to the national
convention as required by the union by-laws, the SC
ruled that the action was premature for the partys
failure to comply with the remedy for intra-union
dispute provided for in its Constitution and by-laws.
A party with an administrative remedy must not
merely initiate the prescribed administrative
procedure to obtain relief but, but also pursue it to its
appropriate conclusion before seeking judicial
intervention.
If intra-union remedies have failed to correct any
violation of the internal labor organization
procedures, a case can then be filed with the Bureau
of Labor Relations.
8.1. Exceptions
Where the exhaustion of administrative remedies
within the union itself would amount to a denial of
justice or would be illusory or vain.
When there is a violation of due process (ex: when
union members have been suspended without the
benefit of a formal charge).
9. CONSEQUENCE OF VIOLATON OF RIGHTS
Violation of rights of members may result in the
cancelation of the union registration of the expulsion
of culpable officers (see last paragraph of Art. 241).
Under D.O. No. 40-03, any complaint or petition with
allegations of mishandling, misappropriation or non-
accounting of funds in violation of Art 241 shall be
treated as an intra-union dispute and shall be heard
ad resolved by the Med-Arbiter.
9.1. Exception: When 30% NOT Required
Art. 241 specifically requires 30% of the members to
report a violation of the labor organization
procedures.
However, when such violation directly affects only 1
or 2 members, then only 1 or 2 members would be
enough to report such violation.
The 30% requirement provided for in Art. 241 is NOT
mandatory because of the use of the permissive
word MAY
Furthermore, Art. 226 of the Labor Code provides
that the Bureau of Labor Relations shall have
original and exclusive jurisdiction over all inter-union
ad intra-union conflicts and disputes, grievances or
problems arising from or affecting labor
48
 management relations, making NO reference
whatsoever to any such 30% support requirement.
Finally, the officials mentioned in Art. 22 are given the
power to act on such disputes upon request of
either parties or at their own initiative.
10. VISITORIAL POWER
The SOLE or his duly authorized representative is
given visitorial power under Art. 274 to inquire into the
financial activities of any labor organization to
determine compliance with the law and to aid in the
prosecution of any violation thereof.
11. CHECK-OFFS AND ASSESSMENTS
Check-off method of deducting from an employees
pay at prescribed period, the amounts due the union
for fees, fines or assessments.
The unions right to collect union dues is recognized
under Art. 277(a).
Union dues is one of the lawful deduction sanctioned y
law under Art. 113, but such dues must be
REASONABLE.
The amount and collection of union dues effect the
entire membership and should thus be approved by
the members themselves.
11.1. Assessments, like Dues, may also be Checked
Off
DUES payments to meet the unions general and
current obligations. The payment must be regular,
periodic and uniform.
Assessment refer to payments used for a special
purpose, especially if required only for a limited time.
See Art. 241 (no special assessment fees, attorneys
fees etc. may be checked off from any amount due an
employee w/o individual written authorization signed
by the employee).
Attorneys fees may NOT be deducted or checked off
from any amount due an employee w/o his written
consent EXCEPT for MANDATORY ACTIVITIES
under the Code.
Mandatory Activity judicial process of settling
dispute laid down by law.
Deductions for union service fee are authorized by law
and needs no check-off authorizations.
Individual written authorizations are required to deduct
from members salary the attorneys fee for concluding
a CBA through compulsory arbitration.
PALACOL v. PURA-FERRA CALLEJA
(GR NO. 85333
Facts:
Union President submitted to the company the
ratification by the union members of the new CBA.
He also submitted an authorization for the company to
deduct union dues of P10 every payday & 10% as
special assessment, from the CBA lump sum pay
granted to the union members.
672 members initially authorized 10% special
assessment while 173 opposed it. Subsequently,
528 members submitted documents stating that they
are withdrawing or disauthorizing thee deduction of
any amount from their CBA lump sum.
They argue that the 10& special assessment is
violative of Art. 214(o) in relation to Art. 222(b).
Ruling:
The Unions failure to STRICTLY comply with the
requirements set forth by aw invalidates the special
assessment when it failed to comply with Art. 241(n)
requiring a general membership meeting, and NOT
local membership meetings on separate occasions.
There can be NO valid check-off considering that the
majority of the union members had already
withdrawn their individual authorizations. Such
withdrawal is equivalent to NO authorization at all.
11.2. Three Requisites to Collect Special
Assessment
a) Authorization by written resolution of the majority
of all the members at the general membership
meeting duly called for the purpose
b) Secretarys record of the minutes of the meeting
c) Individual written authorization for check-off duly
signed by the employee
11.2a. Article 241 (n & o): Authorization Should
Proceed from Free Consent
In a case, the union officers who negotiated the CBA
w/c grants P42M benefits package required the
union members to sign an authorization for the
deduction or check-off of P42.M from the P42M
package.
Such authorization embodied in the ratification of the
employer-employee union memo of agreement is a
VITIATED authorization because it could be
assumed that the union members felt it difficult to
turn down the substantial and lucrative award of
P42M.
Thus, such situation militated against the legitimacy
or genuine consent that should characterize the
authorization.
11.3. Check-off of Agency Fee
Agency fee is an allowable deduction from
employers wage.
This is an amount equivalent to union dues which a
non-union ember pays to the union because he
benefits from the CBA negotiated by it.
Allowed under Art. 248(e).
11.4. Illegal Check-off Ground for Cancellation
49
 Illegal check-off may give rise to a charge of illegal
deduction in violation of Art. 113.
11.5 Employers Liability in Check-off Arrangements
The law does not make the employer directly liable for
the payment to labor organization of union dues &
assessments that the former failed to deduct from its
employees salaries pursuant to the check-off
stipulation.
The employers failure to deduct may constitute a
violation of a contractual commitment for which it may
incur liability for unfair labor practice.
But the employer does NOT, by that omission, incur
liability for the aggregate of dues uncollected from the
union members.
CHECK-OFF imposes an extra burden to the
employer in the form of bookkeeping and
administrative costs. It is a burden assumed by the
management at the instance of the union and for its
benefit, in order to facilitate the collection of dues
necessary for the latters life and sustenance.
The employees obligation to pay union dues and
agency fees is NOT demandable from the employer
upon default or refusal of the employee.
The employers only obligation under a check-off is to
EFFECT the deductions and remit the collections to
the union.
11.6. Jurisdiction over Check-off Disputes
Regional Director of DOLE because the complaint of
union members against a union resolution checking off
10% of their CBA benefits is NOT a money claim
against the employers, even if the employer is named
as respondent.
It is a complaint against the union.
CHAPTER III
RIGHTS OF LEGITIMATE LABOR ORGANIZATIONS
ART. 242. Rights of legitimate labor organizations
A legitimate labor organization shall have the right:
a. To act as the representative of its members for the
purpose of collective bargaining;
b. To be certified as the exclusive representative of all
the employees in an appropriate collective
bargaining unit for purposes of collective bargaining;
c. To be furnished by the employer, upon written
request, with its annual audited financial statements,
including the balance sheet and the profit and loss
statement, within 30 calendar days from the date of
receipt of the request, after the union has been duly
recognized by the employer or certified as the sole
and exclusive bargaining representative of the
employees in the bargaining unit, or within 60
calendar days before the expiration of the existing
collective bargaining agreement, or during the
collective bargaining negotiation;
d. To own property, real or personal, for the use and
benefit of the labor organization and its members;
e. To sue and be sued in its registered name; and
f. To undertake all other activities designed to benefit
the organization and its members, including
cooperative, housing, welfare and other projects not
contrary to law.
Notwithstanding any provision of a general or special law
to the contrary, the income and the properties of
legitimate labor organizations, including grants,
endowments, gifts, donations and contributions they may
receive from fraternal and similar organizations, local or
foreign, which are actually, directly and exclusively used
for their lawful purposes, shall be free from taxes, duties
and other assessments. The exemptions provided herein
may be withdrawn only by a special law expressly
repealing this provision.
1. NOT ANY L.L.O
The first 3 rights mentioned do NOT pertain to just
any union but only to the union that has been
selected as the employees representative in the
bargaining unit.
This article must be read in relation to Art. 225.
2. RIGHT OF UNION TO REPRESENT ITS MEMBERS
50
 Function of Labor Union to represent its members
against the employers unfair labor practices.
The labor union can file an action in their behalf
without the procedure of joining each and every
member as a separate party.
A labor union has a separate personality to sue on its
members behalf for their individual money claims.
Even if the records are NOT clear that the union is a
registered organization, but considering that it filed a
petition with the SOLE, such union has the requisite
personality to sue in its own name.
The union and its lawyer should be allowed to
participate in making compromise settlements with
employees who are union members.
2.1. Members Doubting Their Union
The unions authority to act as its members
representatives for the purpose of collective bargaining
includes the power to represent the members in the
enforcement of the CBA.
When a union files a case for and in behalf of its
members, a member or several members wont be
permitted to file the same case.
However, the INTERVENTION may be allowed hen
there is suggestion of FRAUD or COLLUSION or that
the representative will NOT act in GOOD FAITH for the
protection of the union.
3. COMPROMISE BINDING UPON MINORITY
MEMBERS OF UNION; EXCEPTION
A compromise agreement between the Labor Union
and the company, pursuant to which a ULP case has
been withdrawn, is BINDING upon the minority
members of the union.
However, in one case, the Court ruled that the union
had NO authority to bind the minority members since
the latter did NOT consent to such settlement. Thus,
they are NOT bound by the terms of the settlement.
4. COMPROMISE OF MONEY CLAIMS
Money claims due to laborers cannot be the subject of
a compromise effected by a union or its counsel
without the specific INDIVIDUAL CONSENT of each
member concerned.
The union to which they belong to can only ASSIST
them, NOT decide fro them.
The union officers authority to compromise must be
presented in evidence.
Under the philosophy of collective bargaining, an
employer who bargains in good faith should be entitled
to rely upon the promises and agreements of the union
representatives with whom he must deal under
compulsion of law.
The unions authority to waive or quitclaim all or part of
the judgment award in favor of the workers must be
expressly granted.
5. RIGHT TO BE FURNISHED WITH FINANCIAL
STATEMENT
Four instances when the union may ask in writing for
financial statements:
a) After the union has been recognized by the
employer as the sole bargaining
representative of the employees in the
bargaining unit
b) After the union is certified by DOLE as such
sole bargaining representative
c) Within the last 60 days of the life of a CBA
d) During the collective bargaining agreement
The audited financial statements, including the
balance sheet and the profit & loss statement should
be provided by the employer within 30 calendar days
after receipt of the unions request.
6. RIGHT TO COLLECT DUES
This right is mentioned under Art. 241 and is
explicitly recognized under Art. 271 (a).
Carlo 239 (242 A) 254 (end of 1.4)
ART. 242-A. Reportorial Requirements. - The following
are documents required to be submitted to the Bureau
by the legitimate labor organization concerned:
(a) Its constitution and by-laws, or amendments thereto,
the minutes of ratification, and the list of members who
took part in the ratification of the constitution and by-laws
within thirty (30) days from adoption or ratification of the
constitution and by-lam or amendments thereto;
(b) Its list of officers, minutes of the election of officers,
and list of voters within thirty (30) days from election;
(c) Its annual financial report within thirty (30) days after
the close of every fiscal year; and
(d) Its list of members at least once a year or whenever
required by the Bureau.
Failure to comply with the above requirements shall not
be a ground for cancellation of union registration but
shall subject the erring officers or members to
suspension, expulsion from membership, or any
appropriate penalty." (Inserted by RA 9481, effective
June 14, 2007)
TITLE V COVERAGE
Art. 243. COVERAGE AND EMPLOYEES RIGHT TO
SELF-ORGANIZATION. All persons employed in
commercial, industrial and agricultural enterprises and in
religious, charitable, medical, or educational institutions,
whether operating for profit or not, shall have the right to
self-organization and to form, join, or assist labor
organizations of their own choosing for purposes of
51
collective bargaining. Ambulant, intermittent and itinerant
workers, self-employed people, rural workers and those
without any definite employers may form labor
organizations for their mutual aid and protection.
1. Organizing in general. The rights to organize
and to bargain, in a general sense, are given not
only to employees. Even workers who are not
employees of any particular employer (ex: movie
actors) may organize to protect their interests. The
organization enjoys protection in the Bill of Rights.
Under Art. 243, the right to organize refers also to
forming, joining or assisting a labor organization.
Connected to Art. 246 this carries with it the right
to engage in group action, provided it is peaceful,
to support the organizations objective which is not
necessarily collective bargaining but, simply, to aid
and protect its members. This must be
differentiated from strike which is work stoppage,
must observe regulations; otherwise, the strike
may be declared illegal and its leaders thrown out
of their jobs.
1.1. Coverage of the right to organize;
exceptions. The right to form, join or assist
a labor organization is granted to all kinds of
employees of all kinds of employerspublic or
private, profit or nonprofit, commercial or
religious. Their usual form of organization is a
union and the usual purpose is collective
bargaining with their employers.
Exceptions: Managerial employees,
regardless of the kind of organization where
they are employed, may not join, assist or
form any labor organization, meaning a labor
union. Supervisors are allowed to organize but
they cannot form, join or assist a rank-and-file
union.
2. Right to organize cannot be bargained away.
The right to self-organization must be upheld in
the absence of an express provision of law to the
contrary. It cannot be curtailed by a collective
bargaining agreement.
3. Employees of nonprofit institutions. Rank-
and-file employees of nonprofit medical institutions
are permitted to form, organize or join labor unions
of their choice for purposes of collective
bargaining.
4. Exception: employee-members of a
cooperative. An employee of such a
cooperative who is a member and co-owner
thereof cannot invoke the right to collective
bargaining, for certainly an owner cannot bargain
with himself or his co-owners. However, insofar as
it involves cooperatives with employees who are
not members or co-owners thereof, such
employees are entitled to exercise the rights of all
workers to organization and collective bargaining.
It is the fact of ownership of the cooperative, and
not involvement in the management thereof, which
disqualifies a member from joining any labor
organization within the cooperative.
4.1 Exception to exception: association, not
union. The law does not prohibit members of
cooperative who are also its employees from
forming an association for their mutual aid and
protection or for any legitimate purpose other
than collective bargaining.
5. Exception: international organizations. A
certification election cannot be conducted in an
international organization which the Philippine
Government has granted immunity from local
jurisdiction. The grant of such immunity is a
political question.
Intl Catholic Migration Commission v.
Hon. Calleja. International Organization an
organization set up by agreement between 2 or
more states, endowed with international legal
personality, conducts general international
business which member states have an interest.
Specialized Agencies international
organizations having functions in particular
fields. The reason for these immunities is the
assurance of unimpeded performance of their
functions by the agencies concerned. The
immunity of the Intl Catholic Migration
Commission and the Intl Rice Research
Institution from local jurisdiction by no means
deprives labor of its basic rights.
5.1. Waiver of immunity. waive of immunity is
discretionary to IRRI. Without such express
waiver the NLRC or its LAs have no jurisdiction
over IRRI even in cases of alleged dismissal of
any of its employees.
5.2. Foreign workers. Foreigners, natural or
juridical as well as foreign corps are strictly
prohibited from engaging directly or indirectly in
all forms of trade union activities. However,
aliens working in the country with valid work
permits may exercise the right of self-
organization if they are nationals of a country
that grants the same or similar right to Filipino
workers.
6. Exception: religious objectors; Iglesia ni
Cristo members. RA 3350 was passed to
exempt from compulsory union membership the
followers of any religious sect whose teachings
forbid membership in labor unions.
Victoriano v. Elizalde Rope Workers
Union. What the exception provides, therefore,
is that members of said religious sects cannot
be compelled or coerced to join labor unions
even when said unions have closed shop
agreements with the employers; that in spite of
any closed shop agreement, members of said
religious sectors cannot be refused employment
or dismissed from their jobs on the sole ground
that they are not members of the collective
bargaining union.
52
 1.1. Does the exemption still stand? Even
if the exemption under RA 3350 is not found in the
Labor Code, still the exemption can be invoked
under the freedom of religion clause in the
Constitutions Bill of Rights.
1.2. Iglesia ni Kristo members may form
and join own union. The right of members of
the Iglesia sect not to join a labor union for being
contrary to their religious beliefs does not bar the
members of that sect from forming their own
union. INK members have the right to vote in a
certification election.
Art. 244. Right of employees in the public
service. Employees of government corporations
established under the Corporation Code shall
have the right to organize and to bargain
collectively with their respective employers. All
other employees in the civil service shall have the
right to form associations for purposes not
contrary to law.
1. Government employees right to organize;
limitations. The highest law of the land
guarantees to government employees the right
to organize and to negotiate, but not the right
to strike. The Constitution declares that the
right to self-organization shall not be denied to
government employees; that the State shall
guarantee the rights of all workers to self-
organization, collective bargaining and
negotiations, and peaceful concerted
activities, including the right to strike in
accordance with law.
1.1. Limited purpose. The right of
Government employees to form, join or
assist employees organizations of their
own choosing under EO 180 is not
regarded as existing or available for
purposes of collective bargaining, but
simply for the furtherance and protection
of their interest. Excluded from
negotiation by Government employees are
the terms and conditions of employment
xxx that are fixed by law, it being only the
terms and conditions not otherwise fixed
by law that may be subject of negotiation
between the duly recognized employees
organizations and appropriate government
authorities.
1.2. No signing bonus. Employees and
officers of SSS are not entitled to signing
bonus provided for in collective negotiation
agreement because the process of
collective negotiations in the public sector
does not encompass terms and conditions
of employment requiring the appropriation
of public funds.
1.3. Excepted employees. Excepted
from EO 180 are members of the AFP,
police officers, policemen, firemen and
jail guards. For reasons of security and
safety, they are not allowed to unionize.
EO 180 also declares that high
level employees whose functions are
normally considered as policy making or
managerial, or whose duties are of a
highly confidential nature shall not be
eligible to join the organization of rank-
and-file government employees.
High level employee one
whose functions are normally
considered policy determining,
managerial or one whose duties are
highly confidential in nature.
Managerial function refers to
exercise of powers such as 1. To
effectively recommend such managerial
actions, 2. To formulate or execute
management policies and decisions, 3.
To hire, transfer, suspend, lay-off, recall,
dismiss, assign or discipline employees.
In the private sector the three
levels of positions, for purposes of
unionization, are managerial,
supervisory, and rank-and-file. The latter
two can unionize. In government, the
levels are only two: high level and rank-
and-file. High level employees cannot
unionize.
1.3.A. Professors as rank-ad-file
employees. Professors at the UP who are
not exercising managerial or highly
confidential functions are rank-and-file
employees and may unionize separately
from the non-academic personnel.
UP v. Ferrer-Calleja. UP seeks the
nullification of the Order of the director of the
Bureau of Labor Relatios holding that
professors of the UP are rank-and-file
employees and that they should be
represented by only one labor organization
together with the so-called non-academic
employees.
Issue 1: WON professors, associate
profs, assistant profs are high level or rank-
ad-file employees? Rank-and-file. It is the
University Academic Personnel Committee,
composed of deans, assistant for academic
affairs, chief of personnel, which formulates
the policies, rules and standards respecting
selection etc of members of the academic
staff.
Issue 2: WON profs and employees
performing academic functions should
comprise a bargaining unit distinct from that
of the non-academic employees? Yes. The
53
 community or mutually of interests which
justifies the formation of a single collective
bargaining unit is wanting between the
academic and non-academic personnel of UP.
1.4. Right to strike. EO 180 concedes to
government employees the right to
engage in concerted activities, including
the right to strike, but must be exercised in
accordance with law, subject to Civil
Service Law and legislation by Congress.
The resolution of complaints, grievances
and cases involving government
employees is not ordinarily left to
collective bargaining or other related
concerted activities, but to Civil Service
Law and labor laws and procedures
whenever applicable.
Diana (254 267)
2. REGISTRATION
Govt employees organizations shall register with the CSC
and the DOLE.
- Applications shall be filed with the Bureau of Labor
Relations of the DOLE
- or may also be filed with the Regional Offices of the
DOLE will transmit the applications to the Bureau of
Relations w/n 3 days from receipt thereof.
- Upon approval of the application, a registration
certificate shall be issued (recognizing it as a
legitimate employees organization with the right to
represent its members).
Certificate of registration shall be jointly approved by the
chairman of the CSC and Secretary of DOLE.
3. CERTIFICATION ELECTION IN GOVERNMENT
CORPORATION
A certification election to choose the union that will
represent the employees may be conducted by the Bureau
of Labor Relations in a government corporation, whether
governed by the Labor Code or the Civil Service Rules.
Case: Trade Union of the Phils. v. National Housing
Corp.
Facts: Respondent NHC is a corporation organized in
1959 under EO 399, known as the Uniform Charter of
Government Corporations. Its shares of stock are and
have been 100% owned by the govt from its incorporation
under act 459, the former corporation law.
Ruling: The 1987 Constitution declares that the civil
service embraces all braches, subdivisions,
instrumentalities and agencies of the government,
including GOCCs with original charters.
Consequently, the civil service now covers only GOCCs
with original charters those created by an act of
congress and not those incorporated pursuant to a
general legislation.
No impediment to the holding of a certification election
among the workers of NHC for it is clear that they are
covered by the Labor Code, the NHC being a GOCC
without an original charter.
Whether the employees of NHC are covered by the
Labor Code or by the civil service laws, a
certification election may be conducted.
3.1 ELECTION OF OFFICERS IN GOVERNMENT
UNIONS
Q: Does the BLR have jurisdiction to call for and conduct
the election of officers of an employees association in
the public sector such as that of the MWSS?
A: Yes. Article 226 of the Labor Code BLR (Bureau of
Labor Relations) has the original and exclusive
jurisdiction on all inter-union and intra-union conflicts.
The subject of the case at bar, which is the election of
the officers and members of the board KMKK-MWSS is
clearly an intra-union conflict, being within or inside a
labor union. It is well within the powers of the BLR to act
upon.
4. WHEN PSLMC MAY RULE ON LEGALITY OF
DISMISSAL
The Public Sector Labor-Management Council (EO 180)
has jurisdiction to hear charges of unfair labor practice
filed by the government employees against their
employer (e.g. the Pamantasan ng Lungsod ng Maynila)
In deciding the ULP charge the PSLMC may also rule on
the complainants dismissal if the two issues ULP and
dismissal are unavoidably interlinked.
The CSC may adopt the findings of the PSLMC and
order the employer to reinstate the dismissed
employees.
5. UNION-BUSTING IN A GOVERNMENT AGENCY,
ULP
Case: PLM v. CSC
The CSC adopted the finding and conclusion of the
PSLMC.
Facts: In the arbitration proceedings, the PSLMC found
that PLM committed ULP when it terminated the services
of the complainants. The PLM management did not
renew the appointments of these members of the faculty
with temporary contracts but those who were hired as
replacements possess even lesser qualifications that the
complainants.
54
Ruling: Had complainants not been among those active
officers and/ or members of the PLMFO (Faculty
Organization), and had their qualifications, training,
experience and performance rating not been impressive,
the Commission would have agreed that the termination of
the contracts of complainants does not constitute ULP. But
the records reveal otherwise.
5.1 EVEN TEMPORARY EMPLOYEES MAY ORGANIZE
When the clear intent of PLM Management in terminating
the services of these employees is to abridge their
constitutional right to self-organization, the Commission
has the duty to give them protection and uphold their basic
right.
The constitutional right of the employees is superior to the
right of management not to renew the temporary
appointment of its employees.
When the exercise of discretion by the management is
calculated to bust the union as what PLM Management
had done, the Commission has no choice but to declare it
as a grave abuse of discretion.
Art 277 (c) of the Labor Code, any employee, whether
employed for a definite period or not, shall beginning on
his first day of service, be considered an employee for
purposes of membership in any labor union.
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 my 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. (the last sentence was added by R.A.
9481)
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. (inserted by R.A. 9481)
1.CATEGORIES OF EMPLOYEES
Book V Article 212 Managerial, supervisory, and rank-
and-file
Three-tiered classification (popularized by the Herrera-
Veloso law). This law provides that although supervisory
employees shall not be eligible for membership in a
labor organization of the rank-and-file employees, they
may, however join, assist or form separate labor
organization of their own.
2. INELIGIBILITY OF MANAGERS
2.1. TYPES OF MANAGERIAL EMPLOYEES
Manager generally refers to anyone who is
responsible for subordinates and other organizational
resources
3 levels of Pyramid
1. Top management
2. Middle management
3. First-line management (also called as
supervisor)
First-line Managers the lowest level in the
organization at which individuals are responsible for the
work
- Direct operating employees only
- They do not supervise other managers
- E.g. foreman or production supervisor in a
manufacturing plant, technical supervisor in a
research department
- Are often called supervisors
Middle managers direct the activities of other
managers and sometimes also those of operating
employees.
- To direct the activities that implement their
organizations policies
- To balance the demands of their superiors with the
capacities of their subordinates.
- Example: a plant manager in an electronic firm
Top Managers composed of comparatively small
group of executives
- Responsible for the over-all management
- It establishes operating policies and guides the
organizations interactions with its environment.
- Typical titles: CEO, president, senior vice president
Distinction between managers and supervisors (both
are managerial employees)
Managers (top and middle managers) those who have
authority to devise, implement and control strategic and
operational policies;
Supervisors (First-level managers) those whose task is
simply to ensure that such policies are carried out by the
rank-and-file employees. What distinguishes them from
55
rank-and file employees is that they act in the interest of He believes that Article 245 is unconstitutional,
the employer in supervising such rank-and-file employees. as it abridges sec.8, Art III of the 1987
The route managers of Pepsi-Cola are managerial Constitution.
employees who are ineligible for union membership
according to the first sentence of Article 245. Mr. Puno
He clarifies that Article 245 does not absolutely
The court held that: unlike supervisors who basically disqualify managerial employees from exercising
merely direct operating employees in line with set tasks their right of association. What it prohibits is
assigned to them, route managers are responsible for the merely the right to join labor organizations.
success of the companys main line of business through
management of their sales teams. Such management
necessarily involves the planning, direction, operation and Mr. Justice Vitug
evaluation of their individual teams and areas which the Partially agrees with the majority and with Mr.
work of supervisors does not entail. Puno that Article 245 is not unconstitutional.
But the route managers are not managerial
2.2 CONSTITUTIONALITY OF THE PROHIBITION
employees, they are supervisors.
The question is whether the 1st sentence of Article 245,
3.EVOLUTION OF SUPERVISORS RIGHT TO
prohibiting managerial employees from forming, assisting
ORGANIZE
or joining any labor organization, is constitutional in the
Supervisors CAN UNIONIZE.
light of Article III, Sec8 w/c provides:
The right of the people, including those employed in the
3.1.FIRST PERIOD: Under the Industrial Peace Act
public & private sectors, to form unions, associations, or
(1953-1974)
societies for purposes not contrary to law shall not be
- during this period supervisors could unionize
abridged.
separately from rank-and-file workers
- under this period : in a case (Filoil), that in relation to
In the case of United Pepsi-Cola Supervisory Union vs.
his employer, a foreman or a supervisor is an employee
Laguesma and Pepsi-Cola Products:
within the meaning of this act, for this reason supervisors
are entitled to engaged in Union activities.
The present Article 245 is the result of the amendment of
- the problem is that IPA failed to define a managerial
the Labor Code in 1989 by R.A. No. 6715, otherwise
employee
known as the Herrera-Veloso Law.
-In the Caltex case (decided 1 month after Filoil),
included managers in the term supervisor thus allowing
Unlike the Industrial Peace Act or the Provisions of the
to unionize. The ruling disturbed the businessmen.
Labor Code which it superseded, R.A. 6715 provides
separate definitions of the terms managerial and
3.2.SECOND PERIOD: Under the Labor Code before
supervisory employees
Amendment by R.A, 6715
- At this time, the Labor code dropped the old term
The right guaranteed in Art. III Sec.8 is subject to the
supervisor but replaced it with managerial employee
condition that its exercise should be for purposes not
-The Bulletin case: included supervisors among
contrary to law In the case of 245, there is a rational
managerial employees who could not unionize.
basis for prohibiting managerial employees from joining or
-this time it was the labor groups that rose in protest.
forming labor organizations.
3.3.THIRD PERIOD: Under the Labor Code as Amended
Reason:
by R.A. 6715
1. Because if these managerial employees would
- R.A. 6715 presents a compromise formula: retain the
belong to or be affiliated with a Union, the latter
ineligibility of managerial employees but revive the right
might not be assured of their loyalty to the Union
of supervisory employees to unionize.
in view of evident conflict of interests.
2. Union can also become company-dominated with
4.DEFINITIONS OF MANAGER AND SUPERVISOR
the presence of managerial employees in Union
membership.
Manager makes policy decisions or people decision or
both
2.2a OTHER OPINIONS
Supervisor recommends those decisions. The power to
Chief Justice (Davide, Jr.)
recommend must not be merely routinary or clerical in
He agrees that route managers are managerial
nature but requires the use of independent judgment (1.
employees Discretion or judgment, 2. Independent, 3. Effective)

56

5.TEST OF SUPERVISORY STATUS
The test of supervisory or managerial status
depends on whether a person possesses authority
to act in the interest of his employer and whether
such authority is not merely routinary or clerical in
nature, but requires the use of independent
judgment.
The fact alone that a supervisor makes
recommendations by itself does not make one a
managerial employee. It is more a question of how
effective the recommendation is.
It is the nature of an employees functions and not
the nomenclature or title given to his job which
determines whether he has a rank-and-file or
managerial status.
Characteristics of a managerial rank
1. He is not subject to the rigid observance of regular
office hours
2. His work requires the consistent exercise of
discretion and judgment in its performance
3. The output produced cannot be standardized in
relation to a given period of time
4. He manages a customarily recognized department
or subdivision of the establishment
5. He either has the authority to hire or discharge
employees or his suggestions or
recommendations as to hiring or discharging
employees are given particular weight
6. As a rule, he is not paid hourly wages nor
subjected to maximum hours of work
5.1.THE POWER TO RECOMMEND
The power to recommend, in order to qualify an employee
as a supervisor, must not only be effective but should
require the use of independent judgment. (it must not be
subject to evaluation of other department heads or
executives of the company)
5..2.EXAMPLES OF INNEFECTIVE OR CLERICAL
RECOMMENDATION
The assistant principal and general supervisor admitted
that the recommendations of the area supervisors are
subject to evaluation, review and final approval of the
principal.
Reason: because the preparation of program of
supervision by area supervisors is not indicative that they
are supervisors, their activities being merely routinary, as
for instance, the checking of the formal themes,
notebooks, survey of textbooks and regulating the number
of students in a class.
5.3.MANAGERS OR SUPERVISORS: UNDER THE ILO
CONVENTION
It is not necessarily incompatible with the ILO convention
on Freedom of Association to deny managerial or
supervisory employees the right to belong to the same
trade union as other workers, provided that 2 conditions
are met:
1. That such workers have the right to form their
own association to defend their interest
2. That the categories of such staff are not defined
so broadly as to weaken the organization of
other workers in the enterprise or branch of
activity by depriving them of a substantial portion
of their present or potential membership.
CRUZ (267-280)
6. SEGREGATION OF RANK-AND-FILE
SUPERVISORS
- Art. 245 allows supervisory employees to form, join or
assist separate labor organizations of their own but they
are not eligible for membership in a labor organization of
the rank-and-file employees.
- Rank and file employees may not join a union of
supervisors.
- Reason for the policy: detrimental to the employer if the
supervisors and the rank-and-file employees could take
a common stand against the employer.
- supervisors as alter ego of the management and may
influence the workers under his supervision.
7. CONFIDENTIAL EMPLOYEES
- do not constitute a distinct category of employees for
purposes of the right to self-organize.
- confidentiality is not a matter of official rank, it is a
matter of job content and authority.
- every managerial position is confidential- one does not
become a manager without having gained the
confidence of the appointing authority.
- but not every confidential employee is managerial, he
may be supervisory or rank-and-file.
7.1 1st swing: Inclusion among rank-and-file (Southern
Phil.Federation of Labor v. Calleja)
- SC upheld that the confidential rank-and-file employees
should be included in the bargaining unit.
- if confidential employees are not managers, they can
unionize and no CBA provision can take away that right.
7.2. 2nd swing: exclusion from rank-and-file
- SC upheld the validity of the agreement of the parties
excluding confidential employees from the CBA
coverage. The SC observed that confidential employees
such as accounting personnel, radio and telegraph
operators, having access to confidential information,
may become the source of undue advantage.
7.3. 3rd swing: inclusion among supervisors (Phil.
Phosphate Fertilizer Corp. V. Torres)
57
- ISSUE: wON the professional/technical and confidential
employees may validly join PMPI union which was
composed of supervisors
- HELD: SC ruled for the exclusion of prof/technical but did
not stop the inclusion of the confidential employees. These
professional/technical employees cannot effectively
recommend managerial actions with the use of
independent judgment because they are under the
supervision of superintendents and supervisors.
7.4. 4th swing: inclusion among monthly paid rank and file
(Golden Farms case)
- issue: won the monthly-paid rank-and-file employees can
constitute a bargaining unit separate from the existing
bargaining unit of its daily-paid rank-and-file employees
- held: YES. The monthly-paid are being separated as
bargaining unit form the daily-paid on the ground that they
have different interest to protect.
7.4.a Limited Exclusion. Doctrine of Necessary Implication
- While Art 245 of the Labor Code singles out managerial
employees as ineligible to join, assist or form any labor
organization, under the doctrine of necessary implication,
confidential employees are similarly disqualified.
- Doctrine of Necessary Implication: means that what is
implied in a statute is as much a part thereof as that which
is expressed.
7.4.b The Metrolab and Meralco Summations: Exclusion
from bargaining unit and closed-shop clause
- Confidential employees should be exempted not only
form the closed-shop provision of the CBA but also from
membership in the rank-and-file bargaining unit.
CASE: Metrolab Industries, Inc v. Hon. Nieves
Facts: The Union of Metrolab represents rank-and-file
employees. The renegotiations of a new CBA was caught
in a deadlock so the Union filed a notice of strike.
The Sec. Of Labor intervened and ordered the
parties to execute a new CBA. But Metrolab laid off its
rank-and-file employees, which dismissal was nullified by
the Sec of Labor. Sec. Also ruled that executive
secretaries were part of the bargaining unit of rank-and-file
employees.
Metrolab argued that the executive secretaries
(Gen Mngr., Quality Assurance Mngr, HR Mngr etc) who
were all members of the companys Management
committee, should not only be exempted from the closed-
shop provision but should also be excluded from
membership in the bargaining unit of the rank-and-file
employees because those exec.sec were confidential
employees having access to vital labor organizations.
Held: Although art 245 of the Labor Code limits the
ineligibility to join, form, and assist any labor organization
to managerial employees, jurisprudence has extended this
prohibition to confidential employees.
By the very nature of their functions, they assist
and act in a confidential capacity to, or have access to
confidential matters of, persons whi exercise managerial
functions in the field of labor relations.
7.4.c. Who are confidential employees?
- They assist and act in a confidential capacity to, or
have access to confidential matters of, persons who
exercise managerial functions in the field of labor
relations.
- are those who by reason of their positions or nature of
work are required to assist or act in a fiduciary manner to
managerial employees and hence, are likewise privy to
sensitive and higly confidential records.
7.4.d The Labor nexus
- Confidentiality of the positions should relate to labor
relations matters
CASE: San Miguel Corp. Supervisors and Exempt Union
v. Hon. Laguesma
HELD: Confidential employees are those who:
1. Assist or act in a confidential capacity
2. To persons who formulate, determine and
effectuate management policies in the field of
labor relations.
- Two criteria are cumulative, and both must be
met if an employee is to be considered a
confidential employee.
- Exclusion of confidential employees from
bargaining units: employees should not be
placed in a position involving a potential conflict
of interest.
7.4.e New CBA may include employees excluded
from old CBA; expired CBA may be modified, not
just renewed.
8. SECURITY GUARDS MAY JOIN RANK-AND-
FILE OR SUPERVISORY UNION
- Under RA 6715, security gurads may now freely
join a labor org of the rank-and-file or that of the
supervisory union, depending on their rank.
9. WORKERS IN EXPORT PROCESSING ZONES
- epzs are part of the phil. Territory
- consti. Guarantees the workers right to organize,
to strike and so forth
- ILO Tripartite Declaration of Principles Concerning
Multinational Enterprises and Social Policy: Where
governments of host countries offer special
incentives to attract foreign investments, these
incentives should not include any limitations on the
workers freedom of association or the right to
organize and bargain collectively
ART.246: NON-ABRIDGMENT OF RIGHT TO
SELF-ORGANIZATION
58
- Unlawful for any person to restrain, coerce, Glenn (281-294)
discriminate against or unduly interfere with
employees and workers in their exercise of the
right to self-organization Art. 247 Concept of Unfair Labor Practice and
- Include the right to form, join, or assist labor Procedure for Prosecution thereof
organizations for the purpose of collective
bargaining through representatives of their own
*Concept of Unfair Labor Practice (ULP)
choosing and to engage in lawful concerted
-Self-organization is a pre-requisite of industrial
activities for the same purpose or for their mutual
democracy, the right to self organize has been enshrined
aid and protection, subject to the provisions of
in the constitution and any act intended to weaken or
art.264 of this code.
defeat the right is regarded by law as an offense and it is
- Labor organization entitled to protection does not
technically called unfair labor practice.
have to be a registered organization nor be a
bargaining union.
-The offender can either be an employer of a labor
organization.

-Art. 246 is the conceptual mother of unfair labor

practice. It declares that it is unlawful for any person to
restrain, coerce, discriminate against or unduly interfere
with the exercise of the right to self-organization.

-Victim not workers only but also the State. Thus, the
attack to this constitutional right is considered a crime
which carries with it both civil and criminal liability.

*Elements
(1) ER-EE Relationship between the offender and
the offended.
(2) The act done is expressly defined in the Code
as an act of unfair labor practice. (Art. 248 and
261 for employer, 249 for labor organization)

*Prejudice to public Interest not an element of ULP

-In the case of National Labor Union v. Insular-Yebana
Tobacco Corporation, the SC ruled that a showing of a
prejudice to public interest is not a requisite for ULP
charges to prosper.

*Prosecution of ULP
-ULP has civil and criminal aspects. Civil aspects may
include liability for damages and may passed upon by a
labor arbiter.
-To prosecute ULP as criminal offense, there must be,
first, a finding that an ULP has been committed. The
finding must be based on a judgement held in a labor
case. However, such judgement in a labor case will not
be evidence in the criminal offense.
-The criminal case must be proved independently of the
labor case.

NOTE: In cases in the NLRC where a labor case is filed,

only preponderance of evidence is needed. However,
proof beyond reasonable doubt is needed to convict in
the criminal case of ULP.

-The criminal charge falls under the concurrent

jurisdiction of the MTC or RTC. Penalty of fine or
imprisonment. (Art. 288)
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-Penalty shall be imposed upon guilty officers of a
corporation, partnership, association or entity. If committed
by a labor org, the parties liable are those mentioned
under Art. 249.
-The offense prescribes in one year.
Art. 248- Unfair Labor Practices of Employers
*Conditions Precedent to ULP charge
- Before an employee may be considered aggrieved by an
alleged unfair labor practice by an employer, the following
must exist:
(1) the injured party comes within the definition of
employee under the Code
(2) the ULP must fall under Art. 248 and/or Art.249.
*Mariano vs. Royal Interocean Lines
-Ms. Mariano was dismissed from her job due to her letter
alleging that her employer was inconsiderate and
untactful attitude toward the employees.
The SC held that since the dismissal is not connected with
or necessarily arising from union activities the dismissal
did not constitute an ULP. The employer still retains his
inherent rights to discipline his employees.
*Historical Evidence of the Link
-Our unfair labor practice and workers right derive from
USA
*ILO Convention 98
-Without using the term unfair labor practice convention
98 of the ILO frowns upon anti-union discrimination and
interference. (Provided under the said convention).
*No ULP: Illustrative Instances of Valid Exercise of
Management Rights
-Employer is still capable o his fundamental rights to
prescribe and enforce such rules as he honestly believes
to be necessary to the proper, productive and profitable
operation of the business.
-The only condition imposed upon this control is that it
must not be exercised as to effect a violation of the Act and
its several prohibitions.
*Personnel Management
-As a rule, it is the prerogative of the company to promote,
transfer or even demote its employees to other position
when an interest of the company reasonably demands it.
-Should be exercised within the boundaries of law.
-No ULP in the exercise of an option by the employer
provided in the CBA
*Acceptance of Mass resignation
-Acceptance of a voluntary resignation. Does not
constitute ULP.
-Since it is voluntary, and the company accepted it, such
cannot be said to be an ULP because they (employees)
voluntarily filed it. (PAL case)
Migs [PP. 295-308]
DETERMINATION OF VALIDITY:
-The NLRC has the authority to determine the
employers expressed motive and its effect on the
employees of the managements otherwise equivocal
act.
-While an employer may be free to interact with his
employees without having to show proof of good faith in
such dealings, attendant circumstances such as the
history of his conduct coupled with an intimate
connection between employers action and the union
affiliations of the particular employees, if the former
failed to ascribe good reasons therefore, can constitute
interference.
1. INTERFERENCE
Article 248. It shall be unlawful for a employer
to commit any of the following unfair labor practices(a)
to interfere with, restrain, or coerce employees in the
exercise of their right to self-organization.
Dabuet, et, al v Roche Pharmaceuticals:
Facts: Several officers of Roche expressed their
grievance for the previous dismissal of their unions
president and vice-president. They contained said
grievances in a letter prepared by the counsel for the
labor union and at the same time, seeking a conference
with the general manager. At the meeting, the general
manager berated the employees (petitioners) and called
their letter stupid. The counsel who prepared the letter
then filed a case for grave slander against the general
manager while the general manager and respondent
company responded with a suit for perjury alleging false
statements on the affidavit of petitioners. Furthermore,
Roche dismissed the petitioners on the basis that the
execution of the affidavit was a breach of trust and
inimical to the interest of the company.
Issue: Was there a valid dismissal?
Held: None. The court found that the companys act in
dismissing the petitioners, who constituted the entire
officialdom of the company union just in time when the
CBA was about to the re-negotiated, was interference
and thus, an unfair labor practice. The letter written by
the petitioners involved terms that they wish to bring up
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in the renegotiation of the CBA and it is expected that the
employees recognize said terms as for the mutual aid and
protection of the employees concerned.
Interrogation:
-Persistent interrogation of an employee about his union
activities may be considered as interference.
-In order that a questioning of an employer be not deemed
as coercive, he must apprise the employee questioned of
the purpose of the questioning, assure him that no reprisal
would take place, and that it is only on a voluntary basis.
Can an employer commit an unfair labor practice when
there was yet no union?
-Yes. Paragraph D of Article 248 prohibits the employer
from interfering with the formation or administration of a
labor organization.
Prohibiting organizing activities:
-Solicitation of union membership cannot be prohibited.
Thus, a non-employee union member may be allowed
within the premises of the company for the purpose of
solicitation of membership, if the employees live within the
said premises.
CLLG E.G. Gochangco Workers Union v NLRC
Facts: Several employees sought permission from
management on 26 Febrauary 1980, to attend a pre-
certification election conference before the med-arbiter,
which was to be conducted the day after. The
management did not grant such permission but the
employees nevertheless attended the conference. A day
thereafter, an order of suspension was imposed upon said
employees, which led to their subsequent dismissal on the
ground of abandonment of work.
Issue: Was there a valid dismissal?
Held: None. The petitioners were in the middle of a
certification election preliminary when the order of
termination was imposed. The exercise of a certification
election was well within the petitioners right to which the
respondent company cannot interfere. The termination
order was a clear effort of the management to punish the
petitioners for their union duties.
Violence or Intimidation
-Whenever violence or intimidation is employed upon
employees, it can be taken into account as a circumstance
that can warrant a finding for interference.
Example:
1. An employer pointed a gun at his two
employees after informing the former that they
were in the company premises to vote in the
representation election.
2. An employer provoking two union officers to
fight in the workplace where the same was
prohibited, so as to find cause for their
dismissal.
Espionage and Surveillance
-When an employer engages in surveillance or takes
steps leading his employees to believe it is going on, a
violation results because the employees come under
threat of economic coercion or retaliation for their union
activities.
Economic Inducements
-It is a well-settled rule that while a representation
election is pending, the conferral of employee benefits
for the purpose of inducing the employees to vote
against the union is unlawful.
Totality of Conduct Doctrine:
-The culpability of the employers remarks was to be
evaluated not only on the basis of their implications, but
against the background of and in conjunction with
collateral circumstances. While a word spoken by the
employer be deemed innocent per se, it can be
considered culpable depending on the circumstance
where it was uttered.
The Insular Life Assurance Co. Employees
Association v The Insular Life Assurance Co.
Facts: The company president sent individual letters to
striking employees urging them to abandon their strike in
exchange for comfortable cots, free coffee, occasional
movies, overtime pay, offer of a Christmas bonus and
other benefits. He also warned them that whoever fails
to return to work shall be replaced. When the strike was
over, those who went with the strike were no longer
admitted back to work.
Issue: Did the letter constitute interference?
Held: Yes. Under the totality of conduct doctrine, the
letters should be read in light of the preceding and
subsequent circumstances. There is interference as in
this case, where the employer engaged in a conduct
which may reasonably interfere with the free exercise of
employees rights. This act of solicitation tends to
undermine the concerted activity of the employees to
which the employer had an obligation to respect.
Mass Layoff Amounting to ULP
-A companys capital reduction efforts to camouflage that
it has been making profits, and to justify the mass lay-off
of union members, are considered as ULPs.
Madrigal and Company v Zamora
Facts: The company union of Petitioner Company
sought a renewal of its CBA with petitioner with a
proposal to increase the wage by P200 a month,
together with other additional benefits. Thereafter, the
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company through a board resolution, reduced its capital
stock from 765,000 shares to 267,366 shares, through the
distribution of marketable securities to stockholders. This
was used as the reason for the mass lay-off of employees,
particularly union members.
Issue: Was there an ULP?
Held: Yes. The petitioners capital reduction efforts were all
just a deception to hide the fact that it has been earning
money throughout the years, and likewise to justify the
mass termination of employees. They were nothing but a
premature distribution of assets in order to obviate a just
sharing to labor of the vast profits obtained. This practice
can never be countenanced nor condoned.
Lockout or Closure Amounting to ULP
-An honest closing of ones plant is not an ULP. However, if
the cessation of operations were used by the employer to
influence the employees from pursuing their union
activities, then such a closure can amount to an ULP.
However, proof of the said state of mind of employer is
necessary.
Sale in Bad Faith
Moncada Bijon Factory v CIR and Moncada United
Workers Union
Facts: Kim, the owner of the factory called the workers
and the members of the union to meeting in order to
request them to resign from the union, revert to their
normal work, and withdraw all their overtime claims from
the CIR. These requests were rejected. Four days later, a
deed purporting to convey all of Kims interest in the
company to Yu Guat was executed. As a result thereof, the
members of the union were dismissed while those who
chose to resign from the union were retained under the
new management.
Issue: Were the dismissals unlawful?
Held: Yes. The sale of the factory to Kims agent Yu Guat
was simulated and a device resorted merely to get rid of
the employees who were members of the union.
Cruz v PAFLU
Facts: The workers in a factory formed a union which they
duly registered with DOLE. The company claimed to have
an existing CBA with another union PTGWO, a claim
which resulted in holding a certification election where
PAFLU won. As PAFLU finalized the CBA with the
management, the factory was sold to Cruz and as a result
thereof, members of PAFLU were dismissed.
Issue: Was the sale of the factory an ULP?
Held: Yes. The sale of a business enterprise to avoid the
legal consequences of an unfair labor practice is
necessarily attended with bad faith and both the vendor
and the vendee continue to be liable to the affected
workers. Even if Cruz was only the buyer who purports
to have entered the sale in good faith, he cannot escape
liability as being the successor-in-interest; he becomes
responsible for the obligations of his predecessor.
Assumption of Obligations by New Company
Philippine Land-Air-Sea Labor Union v Sy Indong
Rice and Corn Mill
Facts: Petitioner contends that Sy Indong discriminated
against their members by refusing to admit them to work
on account of their affiliation with the union. This
prompted the complaints for reinstatement against
respondent. While the case was pending, Sy Indong sold
its assets to Sen Chiong who organized the new
company on the very same day as that of the sale. The
new company and the old company both share the same
managing partners. Sy Indong contends that his
company is in a state of bankruptcy.
Issue: Was the sale an ULP?
Held: Yes. The fact that the new company was formed
on the same day, the presence of common partners in
both companies, the fact that the case has been pending
for 18 months prior to the sale, all point to the conclusion
that the sale was a means to relieve Sy Indong from
liability. Moreover, Sen Chiong cannot be said to be fully
aware of the present situation of the company in relation
to the ULP suit by some of its employees. He has
acquired the assets herein at his own risk by having to
bear the liabilities that said litigation may eventually
entail. As such, it is proper that the judgement be
enforced against the new company also.
Successor Employer
-When the closure of a company is employed in order to
defeat the workers organizational right, the successor
company shall be deemed to have only taken the place
of its predecessor.
Piercing the Corporate Veil
-Means that while the corporation cannot be generally
held liable for acts or liabilities of its stockholders or
members, and vice versa because a corporation has a
personality separate and distinct from its members or
stockholders, however, the corporate existence is
disregarded under this doctrine when the corporation is
formed or used for illegitimate purposes, particularly, as
a shield to perpetuate fraud, defeat public convenience,
justify wrong, evade a just and valid obligation or defend
a crime.
The test in determining the applicability of the doctrine of
piercing the veil of corporate fiction is as follows:
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1. Control, not mere majority or complete stock control, but
complete domination, not only of finances but of policy and
business practice in respect to the transaction attacked so
that the corporate entity as to this transaction had at the
time no separate mind, will or existence of its own;
2. Such control must have been used by the defendant to
commit fraud or wrong, to perpetuate the violation of a
statutory or other positive legal duty, or dishonest and
unjust act in contravention of plaintiff's legal rights; and
3.The aforesaid control and breach of duty must
proximately cause the injury or unjust loss complained of.
The absence of any one of these elements prevents
'piercing the corporate veil.' In applying the 'instrumentality'
or 'alter ego' doctrine, the courts are concerned with reality
and not form, with how the corporation operated and the
individual defendant's relationship to that operation."
(CONCEPT BUILDERS, INC. VS. NLRC)
H. Aronson Co. Inc. v Associated Labor Union
Facts: The labor union proposed a CBA with the
management. When the management rejected the CBA,
the union members launched a strike which forced the
former to concede to the terms. However, as an act of
revenge, the management dissolved the company and
formed two new corporations with the same corporate
purposes and capitalization as of their predecessor. The
non-union members were retained while the union
members were dismissed.
Issue: Did the formation of the new companies constitute
ULP?
Held: The facts established by evidence lead to no other
conclusion than that the dissolution of the petitioner
corporation and the subsequent incorporation of he two
new corporations were part and parcel of a plan to
accomplish the dismissal of the employees. First, the
capitalization and corporate function were the same. The
new corporation started business a day after the
dissolution of the old one, and the controlling stockholders
of the old corporation maintained their control over the
board in the new corporation. Thus, by not rehiring the
labor members, it is clear that the dissolution was a device
to stop the legitimate activities of the union.
2. YELLOW DOG CONDITION
Article 248 Paragraph (b) to require as a
condition of employment that a person or an
employee shall not join a labor organization or
shall withdraw from one where he belongs
Yellow-Dog contract- a promise exacted from workers as
a condition of employment that they are not to belong to,
or attempt to foster, a union during their period of
employment.
Usual Stipulations:
a. representation that employee is not a member of
any union
b. promise that the employee will not be joining a
labor union
c. promise that should the employee join a labor
union, he will quit his employment.
In the Philippines, such a contract is an ULP.
3. CONTRACTING OUT
Article 248 Paragraph (c)To contract out
services or functions being performed by union
members when such will interfere with, restrain
or coerce employees in the exercise of their
right to self-organization.
-An employer contracting out of work is considered an
ULP when it is motivated by a desire to prevent his
employees from organizing and selecting a collective
bargaining representative, rid himself of union men, or
escape his statutory duty to bargain collectively with his
employees bargaining representative.
Princess (309-320)
7.1 Contracting Out Restricted by CBA
CASE: Shell Oil Workers Union v. Shell Company of the
Philippines, Ltd
Facts:
- Shell company dissolved its security guard section
and replaced it with an outside agency, claiming that
it was a valid exercise management prerogative.
- Union argued relying on the CBA provision assuring
the continued existence of a security guard section
at least during the lifetime of the collective
agreement
Issue:
- Whether the then existing CBA running for 3 years
from Aug 1 1966 to Dec 31 1969 constituted a bar to
such a decision reached by management
Held:
- YES. There was specific coverage concerning the
security guard section in the CBA. It is found not
only in the body thereof but in the two appendices
concerning wage schedules as well as the premium
pay and the night compensation to which the
personnel in such section were entitled. It was an
assurance of security of tenure during the lifetime of
agreement. The terms of which should be binding on
both parties; should continue during the existence of
the contract
7.2 Runaway Shop
- Resorting to Runaway is ULP.
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 Runaway industrial plant moved by its owners from
one location to another to escape union labor
regulations or state laws; a plant removed to a new
location in order to discriminate against employees at
the old plant because of their union activities; where a
plant removal is for business reasons but the
relocation is hastened by anti-union motivation, the
early removal is an ULP
Immaterial that the relocation is accompanied by a
transfer of title to a new employer.
- Employer may legitimately blunt the effectiveness of
an anticipated strike by stockpiling inventories,
readjusting contract schedules or transferring work
from one plant to another though he thereby makes
himself virtually strikeproof
- Runaway business relocation animated by anti-union
animus. Sameness of business is not enough reason
to show runaway shop to pierce the veil of separate
corporate entity
CASE: Complex Electronic Employees Assoc. v. NLRC
Facts:
- Complex Electronics Corp was a subcontractor of
electronic products where its customers gave their job
orders, sent their own material and consigned their
equipment to it. Customers were foreign-based
companies with different product lines requiring the
employment of workers with specific skills for each
product line.
- The rank and file of Complex compromised the union.
- Complex received a message from Lite-On Phil
requiring it lower its price by 10 %. Such was not
possible for accdg to Complex, they were already
incurring losses. Complex informed employees that it
had to close down the operations of the Lite On Line.
Company promised in giving the one month
retrenchment pay
- Union demanded a retrenchment of 1 year month
salary for every year. Complex refused.
- Complex filed a notice of foreclosure
- Union filed a notice of strike and conducted a strike
vote
- Machinery, equipment and materials being used fir
production of Complex were pulled out from the
company premises and transferred premises of Inonic
Circuit. Next day Complex closed it operation
- Union filed complaint for ULP, illegal closure/illegal
lockout and money claims. Pull out of machineries etc
were against the Labor Code and the CBA. Ionics
were impleaded
- Union averred that Complex and Ionic have the same
President and Board of Director; that business has not
ceased at Complex but was merely transferred to
Ionics, a runaway shop. To prove, that out of 80,000
shares compromising the increased capital stock,
Complex owns them.
Ruling:
- A runaway shop is defined as an industrial plant
moved by its owners from one location to another to
escape union labor regulations or state laws; also
used to describe a plant removed to a new location
in order to discriminate against employees at the old
plant because of the union activities. One where
employer movies its business to another location or
it temporarily closes its business for anti-union
purposes. A relocation motivated by anti-unioun
animus rather than business reasons.
8. FOURTH ULP: COMPANY-DOMINATION OF UNION
(ARTICLE 248 [d])
- Domination of labor union usually manifests in the ff
forms:
a. Initiation of the company union idea.
i. Outright information by the employer or
his representatives;
ii. Employee formation on outright demand
or influence by employer;
iii. Managerially motivated formation by
employees
b. Financial support to the union. Employer defrays
the union expenses or pays the attorneys fees
to the attorney who drafted the constitution and
by-laws of the union
c. Employer encouragement and assistance.
Immediately granting the union exclusive
recognition as a bargaining agent w/o
determining whether the union represents the
majority of employees is an illegal form of
assistance
d. Supervisory assistance. Soliciting membership,
permitting union activities during working time or
coercing employees to join union by threats of
dismissal or demolition
- Er unlawfully aided a union by assisting its attempt
to secure authorization cards from Ees and by
executing a contract w/ such union when it was not
the authorized representative pf the Ees
- Labor union is company-denominated where it
appears that key officials of the company have been
forcing Ees belonging to a rival labor union to join
the former under pain of dismissal should the refuse
to do so
CASE: Progressive development Corp. v. CIR
FACTS:
- Araneta Coliseum Employees Association in behalf
of its 48 members filed a ULP case against
Progressive Devlpt Corp, its officers and the
Progressive Employees Union
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- Complainants alleged that they were dismissed
because they refused to resign from the ACEA and to
affiliate with the PEU which was being aided and
abetted by PDC.
- PDC argued that they had nothing to do with the
formation of PEU, but was not supported by the facts
of records
RULING:
- Dismissal of employees because of union activities
and not because of the companys alleged losses was
adequately proven. It constitutes ULP.
9. FIFTH ULP: DISCRIMINATION (ART. 248[e])
- Law prohibits discrimination to encourage or
discourage membership in a labor organization. Where
the purpose is to influence union activities to
employees, discrimination is unlawful. Discrimination is
not the same as differentiation or classification.
- To constitute ULP: discrimination committed by the
employer must be in regard to the hire or tenure of
employment or any term or condition of employment to
encourage or discourage membership in any labor
organization.
- Discouraging membership in a labor organization
includes not only discouraging adhesion to a union
membership but also discouraging participation in
union activities such as legitimate strike
9.1 Discrimination in Work Quota
- Increase of sales quota of the union president to 400%
while other field reps only 98%
- Uneven application of its marketing plan by the
company is patently an act of discrimination
considered as ULP
9.2 Discrimination in Bonus Allocations or Salary
Adjustments
- There is unfair and unjust discrimination in the granting
of salary adjustments where evidence shows:
o Management paid the employees
unionized branch
o Where salary adjustments were granted to
employees of one of its nonunionized
branches although it was losing in its
operations
o The total salary adjustments given every
ten of its unionized employees would not
even equal the salary adjustments given
one employee in the nonunionized branch
9.3 Discrimination in Layoff or Dismissal
- Even where business conditions justified a layoff of
employees, ULP practices in the form of
discriminatory dismissal were found where only
unionists were permanently dismissed while
nonunionists were not
CASE: Bataan Shipyard and Engineering Co., v. NLRC
Facts:
- The National Federation of Labor Unions (NAFLU) is
a labor org in petitioner BASECO dusly registered
with DOLE. Company has around thousand
employees and more than hundred belong to the
said labor org.
- Company filed with the NLRC an application for
retrenchment of 285 of its employees due to heavy
losses. Meanwhile, some employees who had been
on sick leave earlier were considered retrenched. All
those so happened to be officers and member s of
NAFLU
Ruling:
- Retrenchment is valid. However, manner in which
the prerogative is exercised should not be tainted
with abuse if discretion. While the right of an
employer to dismiss an employee is conceded in a
valid retrenchment, the right differs from and should
not be confused with the manner in which such right
is exercised. It should not be oppressive and
abusive.
- Company has indeed been discriminatory in
selecting the employees who were to be retrenched.
9.4 Discrimination in Regularization
- Complainants could not be extended permanent
appointments because of the absence of vacant
positions
- Only reason that can be advanced for indifferent
attitude towards complainants is the fact that they
are affiliated with the complainant union which
apparently does not have sympathy of their
employer
9.5 Discrimination by Blacklisting
- Blacklist a list of persons marked out for special
avoidance, antagonism or enmity on the part of
those who prepare the list, or those among whom it
is intended to circulate, as where a trade union
blacklists workmen who refuse to conform to its
rules or where a list of insolvent or untrustworthy
persons is published by commercial agency or
mercantile association.
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- When resorted by a combination of employers to
prevent employment of employees for union activities
may constitute ULP
9.6 Indirect Discrimination
- Sec 4 (a)(5) RA 875 (now Art 248 (f) of the Code) it
shall be ULP for an Er to dismiss or discriminate
against an Ee having filed charges or for having given
or being about to give testimony under said Act.
- Legislative intends to give absolute freedom of the
employees to establish labor org. and unions and to
proper charges for violations of the labor laws.
- Following acts are ULP
a. Dismissal of laborer on account of union activities
of his brother
b. Discharge of an Ee due to union activities of the
wife
c. Discharge of wife due to union activities of the
husband
9.7 Test of Discrimination
- It is necessary that the underlying reason for discharge
be established. The fact that a lawful cause of
discharge is available is not a defense where the
employee is actually discharged because of his union
activities. If the discharge is actually motivated by a
lawful reason, the fact that the employee is engaged in
union activities will not lie against the employer
- An inference that the discharge of an employee was
motivated by his union activity must be based upon
evidence, direct or circumstantial, not upon mere
suspicion
9.8 Constructive Discharge
- Employer prohibits employees from exercising their
rights under the Act, on pain discharge, and the
employee quits as a result of the prohibition, a
constructive discharge occurs may be remedied in
an ULP proceeding
- Constructively discharged when she quit her job due to
discriminatory assignment to tasks the employer knew
she cannot perform
9.9 Discharge Due to Union Activity, A Question of
Fact
- Whether an employee was discharged because of his
union activities is essentially a question of fact as to
which the Court on Industrial Relations are conclusive
and binding if supported by substantial evidence
considering the record as a whole.
- Industrial Court governed by the rule of substantial
evidence not preponderance of evidence
- Substantial evidence relevant evidence as a
reasonable mind might accept a adequate to support
a conclusion; evidence which affords a substantial
basis from which the fact in issue can be reasonably
inferred.
9.10 Valid Discrimination: Union Security Clause
- There is a form of encouragement of union
membership which is not considered ULP
Where Management and Union enter unto a contract
bargaining agreement containing union security
clause
Union security clause requires membership in the
union so that an employee may retain his job and
the unions existence is assured
- Union security generic term to closed shop
union shop maintenance of membership or any
other form of agreement which imposes upon
employees the obligation to acquire or retain union
membership as a condition affecting employment
Compulsory union membership whose objective is to
assure continued existence of the union; no
discrimination when certain employees are obliged
to join a particular union
Discrimination, favoring unionism; valid kind of
discrimination
- Employer not guilty of ULP merely complies in
good faith with the request of the certified union for
the dismissal of employees expelled from the union
pursuant to union security clause in the CBA
9.10a Kinds of Union Security Arrangements
- Closed shop: only union members can be hired by
the company and they must remain as union
members to retain employment in the company
- Union shop: nonmembers may be hired but to retain
employment must become union members after
certain period. Requirement applies to present and
future employees
- Modified Union Shop: employees who are not union
members at the time of signing the contract need not
join the union, but all workers hired thereafter mus
join
- Maintenance of membership shop: no employee is
compelled to join the union, but all present or future
members must, as a condition of employment,
remain in good standing in the union
- Exclusive Bargaining Shop: union is recognized as
the exclusive bargaining agent for all employees in
the bargaining unit, whether union members or not
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- Bargaining for Members Only: Union is recognized as
the bargaining agent only for its own members
- Agency shop: agreement whereby employees must
either join the union or pay the union as exclusive
bargaining agent a sum equal to that paid by the
members; directed against free rider employees who
benefit from the union activities w/o contributing
financially to union support; prevents situation where
non members enrich themselves at the expense if
union members
9.10b Validity of Closed-Shop Agreement
- Closed shop is a valid form of union security and such
provision in a CBA is not a restriction of the right of
freedom of association
- Policy of the state to promote unionism to enable the
workers to negotiate with management on the same
level and with more persuasiveness than if they were
individually and independently bargain for the
improvement of their respective conditions
- A closed shop agreement whereby an employer
binds himself to hire only members of the contracting
union who must continue to remain members in good
standing to keep their jobs; most prize achievement of
unionism. Add membership and compulsory dues.
Wield group solidarity promise of employment to
loyal members; very effective form of union security
agreement
- Reason for enforcing the closed-shop agreement:
principle of sanctity or inviolability if contracts
guaranteed by the Constitution.
Provisions of Industrial Peace act granting freedom to
employees to organize and select reps for enetering
bargaining agreements should be subordinated to the
constitutional provision protecting sanctity of contracts
- Closed-shop valid under Sec.4 RA 875.
Kal (323 to 336)
9.10c Advantages and Disadvantages of Closed-Shop
Agreement
Advantages of Closed-shop Agreement: SPICE FE
1. Increase strength and bargaining power of labor
organization
2. Sharing of benefits and obligations
3. Prevent weakening of labor organizations by
discrimination against union members
4. Eliminate decrease of standards due to
competition with nonunion workers
5. Enable effective enforcement of collective
agreements by labor orgs
6. Facilitate collection of dues and enforcement of
union rules
7. Creates harmonious relations between the
employer and employee
Disadvantages: FRICED
1. Results in monopolistic domination of
employment by labor orgs
2. Interfere with freedom to contract and personal
liberty of individual worker
3. Compel employers to discharge nonunion
workers regardless of efficiency etc
4. Facilitate use of labor orgs by unscrupulous
union leaders for extortion, restraint of trade etc
5. Deny equal opportunity for employment to
nonunion workers
6. Enable union to charge exorbitant dues and fees
9.10d Valid Dismissal Because of Application of
Union Security Clause
Union security clauses in CBA, if freely and voluntary
entered into, are valid and binding. Thus, dismissal of an
employee by the company pursuant to a labor unions
demand in accordance with a union security agreement
is not ULP.
Tanduay Distillery Labor Union v. NLRC
Facts: TDI and TDLU entered into a CBA where part of
such agreement provides as a condition for continued
employment, members must maintain good standing
membership in the union. Later some members joined
KAMPIL (another union) and asked for representation in
TDI. TDLU demanded explanation from erring members
as to their act and were later terminated by TDI as
request by TDLU.
Issue: WON such termination was valid.
Ruling: Yes. The employer just put the agreement in
force. Although members are entitled to disaffiliation to
form a new organization of their own, must, however,
suffer the consequences of their separation from the
union under the security clause of the CBA.
9.10e Dismissal pursuant to Closed-shop Clause
Must Clearly Appear in Contract
In order to validly dismiss an employee by force of the
union security clause, there should be a clear and
unequivocal statement that the loss of the status of a
member of good standing in the union shall be the cause
for dismissal.
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Union shop, as with closed-shop provisions, should be
strictly construed against the existence of union shop.
9.10f Due Process Required in Enforcing Union
Security Clause; Intraunion Matter becomes
Termination Dispute with Employer
Although a union security clause in a CBA may be validly
enforced and dismissal pursuant thereto may likewise be
valid, this does not erode the fundamental requirement of
due process. The reason behind the enforcement of union
security clauses which is the sanctity and inviolability of
contracts cannot override ones right to due process.
9.10g Liability of Union to Pay Wages and Fringe
Benefits of Illegally Dismissed Employee
Where the employer compelled the employee to go on
forced leave upon recommendation of the union for
alleged violation of the employee of the closed-shop
agreement, the NLRC correctly ordered the reinstatement
of the employee and directed the union to pay the wages
and fringe benefits which the employee failed to receive as
a result of her forced leave and to pay attorneys fees.
9.10h Employer in Good Faith Not Liable
Where the employer dismissed his employees in the belief
in good faith that such dismissal was required by the
closed-shop provisions of the CBA contract with the union,
he may not be ordered to pay back compensations to such
employees although their dismissal is found to be illegal.
9.10i Closed-shop, To Whom Not Applicable
1. Any employee who at the time the closed shop
agreement takes effect is a bona fide member of
religious org which prohibits its members from
joining labor unions on religious grounds;
2. Employees already in the service and already
members of a labor union or unions other than the
majority union at the time the closed-shop
agreement took effect;
3. Confidential employees who are excluded from the
rand-and-file bargaining unit;
4. Employees excluded from the closed shop by
express terms of the agreement
In the absence of a manifest intent to the contrary, closed-
shop provisions in a CBA apply only to persons to be hired
or to employees who are not yet members of any labor
organization and that it is not applicable to those already in
the service at the time of it execution.
9.19j Agency Fee Instead of Union Membership
The employees who are benefitting from the CBA
without being members of the bargaining union, may be
required to pay an agency fee.
A nonmember should contribute toward the cost of
collective bargaining and should not be allowed to
benefit from collective bargaining process without
supporting it financially.
10 Sixth ULP: Discrimination Because of Testimony
Article 284f
The law protects not only the employees right to form,
join or assist labor organizations but also their right to
testify on matters covered by the Code.
An employee acting alone in pursuing a group interest
may be said to be doing a concerted activity which the
employer may not curtail.
10.1 Refusal to Testify
Mabeza v. NLRC
Facts: Employer asked employee to sign a statement
that they were receiving legal wage but when asked to
swear it before the prosecutor, the latter refused. The
employer asked the employee to surrender the keys to
the quarters and dismissed said employee, charging her
with abandonment and stealing company property.
Issue: WON there was ULP.
Ruling: Yes. There was evident bad faith and deliberate
malice petitioners summary termination from
employment. Art. 248(f) of the Labor Code provides that
it s ULP to dismiss, discharge or otherwise prejudice or
discriminate against an employee for having given or
being about to give testimony.
10.2 Labor Standards Violation May Lead to Strike
Art 118 is limited to matters abt wages Title I Book III
Art 248 subject testified to is any issue covered by the
Code
If labor standards are violated and the employer does
not retaliate against the employees who reported the
violations, there are no ULP and no strikeable situation.
If the employer retaliates, ULP is committed, creating
thereby a strikeable situation.
11 Seventh ULP: Violation of the Duty to Bargain Art
248g
Duty to bargain defined in Arts 252 and 253
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12 Eighth ULP: Paid Negotiation Art 248h
It is a punishable act of ULP for the employer to pay the
union or any of its officers or agents any negotiation fee or
attorneys fee as part of settlement in collective bargaining
or any labor dispute.
13 Ninth ULP: Violation of the CBA Art248i
Where the facts in the case made doubtful the propriety
or equity of imputing to the employer responsibility for
the acts of a particular employee, the ff considerations
were often employed in deciding the issue:
1. Knowledge by the employer of the employees
acts;
2. Continuity of improper conduct by employee;
3. Employers past policy and attitude.

Noncompliance with the agreement is non-observance of

good faith in bargaining; therefore the noncompliance
amounts to ULP.

14 Relief in ULP Cases

14.1 Cease and Desist Order

To support a cease and desist order, the record must show

that the restrained misconduct was an issue in the case;
that there was a finding of fact of said misconduct and
such finding of fact was supported by evidence.

14.2 Affirmative Order

Full reinstatement of the discharged employees to their

substantially equivalent position without prejudice to their
seniority and other rights and privileges.

14.3 Order to Bargain; Mandated CBA

When an employer has refused /failed to bargain with the

proper bargaining agent of his employees, the Court may
issue and affirmative order to compel the respondent to
bargain with the bargaining agent.

14.4 Disestablishment

An order requiring an employer to disestablish a company-

dominated union does not necessarily impose upon the
employer the duty of dissolving and liquidating the
structure and organization of the objectionable union.

15 ULP Not Subject to Compromise

The relation between capital and labor are so impressed

with public interest that labor contracts must yield to the
common good.

16 ULP In A Given Period Should Be Included In Single

Charge

The union should not be allowed to split its cause of action

and harass the employer with subsequent charges, based
upon acts committed during the same period of time.

17 Employers Responsibility For ULP Acts Done By

Subordinate Officials

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