PART IV collective bargaining history; and (4) employment status, such as temporary, seasonal
CERTIFICATION ELECTION AND REPRESENTATION ISSUES CB ULP and probationary employees.
A. CERTIFICATION ELECTION AND REPRESENTATION ISSUES
APPROPRIATE BARGAINING UNIT
1. CENTRAL NEGROS ELECTRIC COOP VS SECRETARY
Where a union has filed a petition for certification election, the mere fact that no
opposition is made does not warrant a direct certification.
By directly certifying a Union without sufficient proof of majority representation,
themed arbiter has in effect arrogated unto himself the right, vested naturally in the
employee's to choose their collective bargaining representative. He has in effect
imposed upon the petitioner the obligation to negotiate with a union whose majority
representation is under serious question. This is highly irregular because while the
Union enjoys the blessing of the Minister, it does not enjoy the blessing of the
employees. Petitioner is therefore under threat of being held liable for refusing to
negotiate with a union whose right to bargaining status has not been legally
established.
While there may be some factual variances, the rationale therein is applicable to the
present case in the sense that it is not alone sufficient that a union has the support of
the majority. What is equally important is that everyone be given a democratic space
in the bargaining unit concerned. The most effective way of determining which labor
organization can truly represent the working force is by certification election.
2. DEMOCRATIC LABOR ASSOCIATION VS. CEBU STEVEDORING COMPANY,
INC. ET AL.,
ISSUE
How to determine the proper collective bargaining unit and what unit would be
appropriate to be the collective bargaining agency.
RULING
There are various factors which must be satisfied and considered in determining the
proper constituency of bargaining unit. No particular factor is itself decisive of the
determination. But the most pertinent to the case are: (1) will of employees (Globe
Doctrine); (2) affinity and unity of employees' interest, such as substantial similarity
of work and duties, or similarity of compensation and working conditions; (3) prior
Scroll No. 577
By reason of the modern complexity of both employer and union structure, it
frequently becomes difficult to determine from the evidence alone which of several
claimant groups form a proper bargaining unit. It then becomes necessary to give
consideration to the express will or desire of the employees. This practice of
considering; the employees' will has been, designated as the Globe doctrine. This
doctrine arose in a case where there were four contending labor groups, three
claiming to be the proper bargaining units for employees coming within each of their
three separate categories of work, and the fourth claiming the right to be designated
as the bargaining unit for all employees on a plant-wide basis. The National labor
Relations Board, finding that each of the competing units have an equally valid basis
for their respective claims, decided to hold a series of elections, not for the purpose
of allowing the group receiving an overall majority of votes to represent all
employees, but for the specific purpose of permitting the employees in each of the
several categories of work to select the group which each chose as a bargaining unit.
The second factor is perhaps one of the most conclusive in determining the proper
bargaining unit. Inasmuch, as the basic test of a bargaining unit's acceptability is
whether it will best assure to all employees the exercise of their collective bargaining
rights, industrial experience indicates that the most efficacious bargaining unit is one
which is comprised of constituents enjoying a community of interest and economic or
occupational unity. This community of interest is reflected in groups having
substantial similarity of worlc and duties or similarity of compensation and working
conditions.
Another important factor is the precedent history of collective bargaining between
the proposed bargaining unit and the employer. When this precedent exists, it may
be assumed that the court will not disturb the composition of a consolidated
bargaining unit which has an established existence and has, in its past dealings with
the employer, demonstrated its service to the collective bargaining purposes of the
act. However, where the circumstances have been so altered or where the reciprocal
relationship of the employer and the bargaining unit has been so changed that the
past mutual experience in collective bargaining cannot be reasonably said to establish
a reliable guide to the present constituency of the bargaining unit, then prior
collective bargaining history cannot be considered a factor in the determination. In
such an event, the determination must be made entirely upon the basis of existing
facts and with due consideration to all of the remaining factors.
The status of employment is another important factor in the determination of which
employees shall be included or excluded from a proposed bargaining unit. There are
certain positions and categories of work which, by their very nature, place the
employees in a position wherein a conflict of duties and interest exists. There are
1|LabRel – Part IV-C
several categories of employment which have so far received the special attention of
congress, the courts and the board, among them supervisory employees, confidential
employees, guards and plant policemen and temporary, seasonal and probationary
employees. With respect to suck employees, there frequently arises the question of
the right to include or exclude them from bargaining units composed of permanent
employees. It was hold that employees hired on a brief, casual or day to day basis or
for a short, definite term, and who have no reasonable basis for continued or
renewed employment for any appreciable substantial time, are considered to have no
such mutuality of interest with permanent employees as to justify their interest in a
bargaining unit composed of such permanent employees.
3. ALHAMBRA CIGAR & CIGARETTE MANUFACTURING COMPANY vs.
ALHAMBRA EMPLOYEE’S ASSOCIATION (PAFLU)
ISSUES
The first issue to be resolved by the Court concerns the composition of the
appropriate unit.
The second issue which was raised in this case is whether or not the collective
bargaining agreement entered into between the company and the FOITAF constitutes
a bar to the instant proceeding.
RULING
In arriving at the conclusion that all the employees in the administrative, sales, and
dispensary departments of the company, with the exception of the supervisors,
security guards, and confidential employees therein, constitute an appropriate
collective bargaining unit, the lower court considered the fact that said employees
are engaged in "an entirely different kind of work" which does not involve production
and maintenance, and the additional fact that the places where they work are
separate from those of the workers in the other departments of the company.
Examination of the collective bargaining agreement entered into between the
company and FOITAF and the agreements entered subsequent thereto discloses
beyond doubt that they expressly cover only the workers in the five departments of
the company. In no single instance is the term "employees" mentioned to convey the
idea that those in the other three departments, namely, the administrative, sales, and
dispensary departments, are also covered by said agreements.
While it may be true the benefits granted under said agreements were extended to,
and enjoyed by, all the workers in all the eight departments of the company, the fact
remains that those in the administrative, sales, and dispensary departments were not
Scroll No. 577
expressly covered and, should the company, at any time, decide not to extend to
them said benefits, they cannot legally demand their extension to them as they
would have nothing to invoke in support of said demand.
4. SAN MIGUEL CORPORATION SUPERVISORS AND EXEMPT UNION vs.
LAGUESMA
ISSUES
1. Whether Supervisory employees 3 and 4 and the exempt employees of the
company are considered confidential employees, hence ineligible from joining a
union. NO
2. If they are not confidential employees, do the employees of the three plants
constitute an appropriate single bargaining unit. NO
RULING
1. In the case at bar, supervisors 3 and above may not be considered confidential
employees merely because they handle "confidential data" as such must first be
strictly classified as pertaining to labor relations for them to fall under said
restrictions. The information they handle are properly classifiable as technical and
internal business operations data which, to our mind, has no relevance to
negotiations and settlement of grievances wherein the interests of a union and the
management are invariably adversarial. Since the employees are not classifiable
under the confidential type, this Court rules that they may appropriately form a
bargaining unit for purposes of collective bargaining.
2. An appropriate bargaining unit may be defined as "a group of employees of a
given employer, comprised of all or less than all of the entire body of employees,
which the collective interest of all the employees, consistent with equity to the
employer, indicate to be best suited to serve the reciprocal rights and duties of the
parties under the collective bargaining provisions of the
law."
A unit to be appropriate must effect a grouping of employees who have substantial,
mutual interests in wages, hours, working conditions and other subjects of collective
bargaining.
It is readily seen that the employees in the instant case have "community or
mutuality of interests," which is the standard in determining the proper constituency
of a collective bargaining unit. 26 It is undisputed that they all belong to the Magnolia
Poultry Division of San Miguel Corporation. This means that, although they belong to
2|LabRel – Part IV-C
three different plants, they perform work of the same nature, receive the same
wages and compensation, and most importantly, share a common stake in concerted
activities.
The fact that the three plants are located in three different places, namely, in
Cabuyao, Laguna, in Otis, Pandacan, Metro Manila, and in San Fernando, Pampanga is
immaterial. Geographical location can be completely disregarded if the communal or
mutual interests of the employees are not sacrificed as demonstrated in UP v. Calleja-
Ferrer where all non-academic rank and file employee of the University of the
Philippines in Diliman, Quezon City, Padre Faura, Manila, Los Baños, Laguna and the
Visayas were allowed to participate in a certification election. We rule that the
distance among the three plants is not productive of insurmountable difficulties in
the administration of union affairs. Neither are there regional differences that are
likely to impede the operations of a single bargaining representative.
5. PHILIPS INDUSTRIAL DEVELOPMENT, INC. vs. NLRC
ISSUE
WON service engineers, sales representatives and confidential employees of
petitioner are qualified to be part of the existing bargaining unit.
RULING
No. All these employees, with the exception of the service engineers and the sales
force personnel, are confidential employees. Their classification as such is not
seriously disputed by PEO-FFW; the five (5) previous CBAs between PIDI and PEO-
FFW explicitly considered them as 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 who exercise managerial functions
in the field of labor relations. As such, the rationale behind the ineligibility of
managerial employees to form, assist or join a labor union equally applies to them.
6. NATIONAL ASSOCIATION OF FREE TRADE UNIONS vs. MAINIT LUMBER
DEVELOPMENT COMPANY WORKERS UNION-UNITED LUMBER
ISSUE
Scroll No. 577
Whether or not the two (2) bargaining units be treated as one.
RULING
Yes. The existence of a bargaining history is a factor that may be reckoned with in
determining the appropriate bargaining unit, the same is not decisive or conclusive.
Other factors must be considered. The test of grouping is community or mutuality of
interests. This is so because "the basic test of an asserted bargaining unit's
acceptability is whether or not it is fundamentally the combination which will best
assure to all employees the exercise of their collective bargaining rights."
Certainly, there is a mutuality of interest among the employees of the
Sawmill Division and the Logging Division. Their functions mesh with one another.
One group needs the other in the same way that the company needs them both.
There may be difference as to the nature of their individual assignments but the
distinctions are not enough to warrant the formation of a separate bargaining unit.
PETITION FOR CERTIFICATION ELECTION
7. ME-SHURN CORPORATION AND SAMMY CHOU, vs. ME-SHURN WORKERS
UNION-FSM AND ROSALINA* CRUZ
ISSUE/S
1.) WON the dismissal of the employees of petitioner Meshurn Corporation is
for an authorized cause.
2.) WON the union can maintain a suit against the corporation.
RULING
1. NO.
Basic is the rule in termination cases that the employer bears the burden of showing
that the dismissal was for a just or authorized cause. Otherwise, the dismissal is
deemed unjustified. Apropos this responsibility, the corporation should have
presented clear and convincing evidence of imminent economic or business reversals
as a form of affirmative defense in the proceedings before the labor arbiter or, under
justifiable circumstances, even on appeal with the NLRC. However in all the
proceedings before the two quasi-judicial bodies and even before the CA, no
evidence was submitted to show the corporations alleged business losses. It is only
now that petitioners have belatedly submitted the corporations’ income tax returns
from 1996 to 1999 as proof of alleged continued losses during those years.
3|LabRel – Part IV-C
 2. YES.
Neither are we prepared to believe petitioners’ argument that respondent union was
not legitimate. It should be pointed out that on June 29, 1998, it filed a PCE. While
this Petition was initially dismissed by the med-arbiter, the appeal was granted and
that the Undersecretary ordered the holding of a certification election.
The DOLE would not have entertained the Petition if the union were not a legitimate
labor organization within the meaning of the Labor Code. Under this Code, in an
unorganized establishment, only a legitimate union may file a petition for
certification election.[34] Hence, while it is not clear from the record whether
respondent union is a legitimate organization, we are not readily inclined to believe
otherwise, especially in the light of the pro-labor policies enshrined in the
Constitution and the Labor Code.
Verily, the union has the requisite personality to sue in its own name in order to
challenge the ULP committed by petitioners against it and its members.[36] It would be
an unwarranted impairment of the right to self-organization through formation of
labor associations if thereafter such collective entities would be barred from
instituting action in their representative capacity
8. NESTLE PHILIPPINES, INC., versus NLRC
ISSUE
W/N the venue was proper. YES. The parties waived the defense of improper venue,
hence the case should go on.
RULING
Petitioners waived the defense of improper venue. Although petitioners invoked the
said ground in their Position Paper, they did not pursue it with the diligence of a party
confidently if not absolutely, certain of the indubitability of his defense. One who is
so would incur no delay in pursuing the defense to end the litigation and prevent
further waste of precious time and expense. This belated awakening from deep
slumber and deafening silence deserves no sympathy but, rather, condemnation as it
is a crude legal maneuver, grounded on pure technicality and unfavorable to labor,
designed to delay the proceedings before the Labor Arbiter.
Paragraph (a), Section 1, Rule V of the NLRC Rules speaks of the
complainant/petitioner’s workplace. It is evident that the rule is intended for the
exclusive benefit of the worker. The reason for this is not only convenience, it is
economic as well. The worker, being the economically-disadvantaged party —
Scroll No. 577
whether as complainant/petitioner or as respondent, as the case may be, the nearest
governmental machinery to settle the dispute must be placed at his immediate
disposal, and his adverse party must in no case be allowed a choice in favor of
another competent agency sitting in another place to overburden the former. This
being the case, the worker may waive the benefit.
It is not denied that Nestle has its principal office in the National Capital Region. It is
likewise admitted that the UFE-DFA and six (6) of the individual complainants are
residents in areas within the National Capital Region. All of the individual private
respondents are members of the UFE-DFA. All are aggrieved by the decision of Nestle
to dismiss them. Under the afore-quoted rule, the case may be filed with the RAB,
NCR, or with the RAB of either Cagayan de Oro City (Region X) or the RAB of Region
IV. The application of this rule in this case would be the most logical step to take to
prevent multiplicity of suits which would only delay and render expensive the
settlement of the dispute in violation of the basic rules of construction set forth in
Section 2, Rule I of the Revised Rules of the NLRC.
9. CRUZVALE, INC., petitioner, vs. LAGUESMA
1. W/N UFW is a legitimate labor organization. YES. The Med-Arbiter found that
private respondent was issued Certificate of Registration and Charter
Certificate.Findings of fact of labor officials are generally conclusive and binding upon
this Court when supported by substantial evidence.
2. W/N the certification election should cover those employed in the cinema business
and not only the employees at the garment factory. NO. As stated in the questioned
Decision the employees at the Cinema operation and those at the garment
manufacturing operation do not share commonality of interest as the former clearly
perform work entirely different from that of the latter. Thus, their separation into two
(2) distinct bargaining units is proper.
3. Where should the petition for certification election be filed. In the Regional Office
which has jurisdiction over the principal office of the Employer.
The word "jurisdiction" as used in said provision refers to the venue where the
petition for certification must be filed. Unlike jurisdiction, which implies the power of
the court to decide a case, venue merely refers to the place where the action shall be
brought.
The worker, being the economically-disadvantaged party whether as complainant,
petitioner or respondent, as the case may be, the nearest governmental machinery to
settle a labor dispute must be placed at his immediate disposal and the employer
4|LabRel – Part IV-C
must in no case be allowed a choice in favor of another competent agency sitting in
another place to the inconvenience of the worker.
Petitioner has not shown how it will be prejudiced by the hearing on the petition for
certification election before the Regional Office No. IV, which has its offices in Quezon
City, the same city where the principal place of business of petitioner is located.
Petitioner is, therefore, being unreasonable in demanding that the petition for
certification election be filed with the National Capital Region Office, which holds
offices in Manila.
For purposes of venue, workplace shall be understood as the place or locality where
the employee is regularly assigned when the cause of action arose. It shall include the
place where the employee is supposed to report back after a temporary detail,
assignment or travel. . . .
The Omnibus Rules Implementing the Labor Code has no provision as to when an
objection to improper venue may be raised. But the stance of the Med-Arbiter, that
the question of the venue in representation cases should be raised at the first
hearing, was accepted by respondent Undersecretary. We are not prepared to say
that said administrative Officials have gravely abused their discretion.
10. LA SUERTE CIGAR AND CIGARETTE FACTORY vs. DIRECTOR OF BLR
ISSUES
1. WON the 14 dealers are employees or independent contractors.
2. WON the withdrawal of 31 union members from the NATU affected the PCE insofar
as the 30% requirement is concerned.
RULING
1. The 14 dealers are independent contractors. Employment relationship is
important in the determination of who shall be included in a proposed bargaining
unit because it is the fundamental and essential condition that a bargaining unit be
composed of employees. Failure to establish this juridical relationship between the
union members and the employer affects the legality of the union itself. It means
ineligibility of the union members to present a PCE as wells as to vote therein.
Corollarily, when a PCE is supported by 48 signatories in a bargaining unit composed
of 60 salesmen, but 14 of the 48 lacks employee status, the petition is vitiated
thereby.
2. YES. It appearing that the 31 union members had withdrawn their support to the
PCE before the filing of the PCE, the presumption is the withdrawal was made
Scroll No. 577
voluntarily unless there is convincing proof to the contrary. It would be otherwise if
the withdrawal was made after the filing of the petition for it would then be
presumed that the withdrawal was not free and voluntary.
The reason for such distinction is that if the withdrawal or retraction is made before
the filing of the petition, the names of employees supporting the petition are
supposed to be secret to the opposite party, logically, any such withdrawal or
retraction shows voluntariness in the absence of proof to the contrary. Moreover, it
becomes apparent that such employees had not given consent to the filing of the
petition; hence the subscription requirement has not been met. When the
withdrawal or retraction is made after the PCE is filed, the employees who are
supporting the petition become known to the opposite party since their names are
attached to the petition at the time of filing. Therefore, it would not be unexpected
that the opposite party would use foul means for the subject employees to withdraw
their support.
With the withdrawal of 31 members of their support prior to the filing of PCE and the
14 union members who are not employees of the company but independent
contractors, the remainder of 3 out of the 48 alleged to have supported the petition
can hardly be said to represent the union.
11. CALIFORNIA MANUFACTURING CORPORATION, versus LAGUESMA
ISSUE
WON the 25% subscription requirement applies NO.
RULING
Article 257 of the Labor code is applicable to unorganized labor organizations
and not to establishments where there exists a certified bargaining agent which
had previously entered into a collective bargaining agreement with the
management. Otherwise stated, the establishment concerned must have no certified
bargaining agent.
In the instant case, it is beyond cavil that the supervisors of CMC which
constitute a bargaining unit separate and distinct from that of the rank-and-file,
have no such agent. Thus they correctly filed a petition for certification election
thru union FFW-CALMASUCO, likewise indubitably a legitimate labor
organization.
CMC's insistence on the 25% subscription requirement is clearly immaterial. The
same has been expressly deleted by Section 24 of Republic Act No. 6715 and is
presently prescribed only in organized establishments, that is, those with existing
bargaining agents.
12. NATIONAL MINES AND ALLIED WORKERS UNION vs. LUNA
5|LabRel – Part IV-C

13. PROGRESSIVE DEVELOPMENT CORPORATION-PIZZA HUT versus
LAGUESMA
ISSUE
WON the denial of Med-Arbiter and public respondent to thepetitioner's request for
the suspension of proceedings in the certification election case constituted a grave
abuse of discretion? YES
RULING
The Labor Code requires that in organized and unorganized establishments, a petition
for certification election must be filed by a legitimate labor organization.
In the case before us, the Med-Arbiter summarily disregarded the petitioner's prayer
that the former look into the legitimacy of the respondent. Union by a sweeping
declaration that the union was in the possession of a charter certificate so that "for
all intents and purposes, Sumasaklaw sa Manggagawa sa Pizza Hut (was) a legitimate
labor organization."
The grounds ventilated in cancellation proceedings in accordance with Article 239 of
the Labor Code constitute a grave challenge to the right of respondent Union to ask
for certification election. The Med-Arbiter should have looked into the merits of the
petition for cancellation before issuing an order calling for certification election.
Registration based on false and fraudulent statements and documents confer no
legitimacy upon a labor organization irregularly recognized, which, at best, holds on
to a mere scrap of paper. Under such circumstances, the labor organization, not being
a legitimate labor organization, acquires no rights, particularly the right to ask for
certification election in a bargaining unit
14. R. TRANSPORT CORPORATION vs. LAGUESMA
The phrase "final certification election result" means that there was an actual
conduct of election i.e. ballots were cast and there was a counting of votes.
In this case, there was no certification election conducted precisely because the first
petition was dismissed, on the ground of a defective petition which did not include all
the employees who should be properly included in the collective bargaining unit.
Scroll No. 577
It should be noted that it is the petitioner, the employer, which has offered the most
tenacious resistance to the holding of a certification election. This must not be so for
the choice of a collective bargaining agent is the sole concern of the employees. The
employer has no right to interfere in the election and is merely regarded as a
bystander.
15. CAPITOL MEDICAL CENTER OF CONCERNED EMPLOYEES-UNIFIED FILIPINO
SERVICE WORKERS vs LAGUESMA
Yes. A "deadlock" is . . . the counteraction of things producing entire stoppage; . . . .
There is a deadlock when there is a complete blocking or stoppage resulting from the
action of equal and opposed forces . . . . The word is synonymous with the word
impasse, which . . "presupposes reasonable effort at good faith bargaining which,
despite noble intentions, does not conclude in agreement between the parties."
Although there is no "deadlock" in its strict sense as there is no "counteraction" of
forces present in this case nor "reasonable effort at good faith bargaining," such can
be attributed to CMC's fault as the bargaining proposals of respondent union were
never answered by CMC. In fact, what happened in this case is worse than a
bargaining deadlock for CMC employed all legal means to block the certification of
respondent union as the bargaining agent of the rank-and-file; and use it as its
leverage for its failure to bargain with respondent union. Thus, we can only conclude
that CMC was unwilling to negotiate and reach an agreement with respondent union.
CMC has not at any instance shown willingness to discuss the economic proposals
given by respondent union.
If the law proscribes the conduct of a certification election when there is a bargaining
deadlock submitted to conciliation or arbitration, with more reason should it not be
conducted if, despite attempts to bring an employer to the negotiation table by the
"no reasonable effort in good faith" on the employer certified bargaining agent, there
was to bargain collectively.
Respondent union had taken an action to legally coerce the employer to comply with
its statutory duty to bargain collectively, i.e., charging the employer with unfair labor
practice and conducting a strike in protest against the employer's refusal to
bargain. It is only just and equitable that the circumstances in this case should be
considered as similar in nature to a "bargaining deadlock" when no certification
election could be held. This is also to make sure that no floodgates will be opened for
the circumvention of the law by unscrupulous employers to prevent any certified
bargaining agent from negotiating a CBA.
6|LabRel – Part IV-C
 16. KAISAHAN NG MANGGAGAWANG PILIPINO vs. TRAJANO
ISSUES
1. WON the prohibition on the holding of a certification election “within one
year from the date of issuance of declaration of a final certification election
result”
2. WON KAMPIL's PCE is barred because, before its filing, a bargaining deadlock
between VIRON and NAFLU as the incumbent bargaining agent, had been
submitted to conciliation or arbitration or had become the subject of a valid
notice of strike or lockout, in accordance with Section 3, Rule V, Book V of
the Omnibus Rules above quoted.
RULING
1. NO.
It is evident that the prohibition imposed by law on the holding of a certification
election "within one year from the date of issuance of declaration of a final
certification election result' — in this case, from February 27, 1981, the date of the
Resolution declaring NAFLU the exclusive bargaining representative of rank-and-file
workers of VIRON — can have no application to the case at bar.
That one-year period-known as the "certification year" during which the certified
union is required to negotiate with the employer, and certification election is
prohibited 2 — has long since expired.
2. NO.
Again it seems fairly certain that prior to the filing of the petition for election in this
case, there was no such "bargaining deadlock ... (which) had been submitted to
conciliation or arbitration or had become the subject of a valid notice of strike or
lockout."
To be sure, there are in the record assertions by NAFLU that its attempts to bring
VIRON to the negotiation table had been unsuccessful because of the latter's
recalcitrance and unfulfilled promises to bargain collectively; 3 but there is no proof
that it had taken any action to legally coerce VIRON to comply with its statutory duty
to bargain collectively. It could have charged VIRON with unfair labor practice; but it
did not.
It could have gone on a legitimate strike in protest against VIRON's refusal to bargain
collectively and compel it to do so; but it did not. There are assertions by NAFLU, too,
that its attempts to bargain collectively had been delayed by continuing challenges to
the resolution pronouncing it the sole bargaining representative in VIRON; but there
is no adequate substantiation thereof, or of how it did in fact prevent initiation of the
bargaining process between it and VIRON.
Scroll No. 577
The stark, incontrovertible fact is that from February 27, 1981 — when NAFLU was
proclaimed the exclusive bargaining representative of all VIRON employees — to April
11, 1985 — when KAMPIL filed its petition for certification election or a period of
more than four (4) years, no collective bargaining agreement was ever executed, and
no deadlock ever arose from negotiations between NAFLU and VIRON resulting in
conciliation proceedings or the filing of a valid strike notice.
Obviously, however, these activities took place after the initiation of the certification
election case by KAMPIL, and it was grave abuse of discretion to have regarded them
as precluding the holding of the certification election thus prayed for.
WHEREFORE, it being apparent that none of the proscriptions to certification election
set out in the law exists in the case at bar, and it was in the premises grave abuse of
discretion to have ruled otherwise, the contested Resolution of the respondent
Director the case is NULLIFIED AND SET ASIDE.
17. ASSOCIATED LABOR UNIONS (ALU) vs. CALLEJA
ISSUE
W/N the collective bargaining agreement is defective. YES.
RULING
A careful consideration of the facts culled from the records of this case, especially the
allegations of petitioner itself as hereinabove quoted, yields the conclusion that the
collective bargaining agreement in question is indeed defective hence unproductive
of the legal effects attributed to it by the former director in his decision which was
subsequently and properly reversed.
We have previously held that the mechanics of collective bargaining are set in motion
only when the following jurisdictional preconditions are present, namely, (1)
possession of the status of majority representation by the employees' representative
in accordance with any of the means of selection and/or designation provided for by
the Labor Code; (2) proof of majority representation; and (3) a demand to bargain
under Article 251, paragraph (a), of the New Labor Code. 4 In the present case, the
standing of petitioner as an exclusive bargaining representative is dubious, to say
the least. It may be recalled that respondent company, in a letter dated May 12, 1986
and addressed to petitioner, merely indicated that it was "not against the desire of
(its) workers" and required petitioner to present proof that it was supported by the
majority thereof in a meeting to be held on the same date. 5 The only express
recognition of petitioner as said employees' bargaining representative that We see in
7|LabRel – Part IV-C
the records is in the collective bargaining agreement entered into two days
thereafter. 6 Evidently, there was precipitate haste on the part of respondent
company in recognizing petitioner union, which recognition appears to have been
based on the self-serving claim of the latter that it had the support of the majority
of the employees in the bargaining unit. Furthermore, at the time of the supposed
recognition, the employer was obviously aware that there were other unions existing
in the unit. As earlier stated, respondent company's letter is dated May 12, 1986
while the two other unions, Southern Philippine Federation of Labor (hereafter, SPFL
and Philippine Social Security Labor Union (PSSLU, for short), went on strike earlier on
May 9, 1986. The unusual promptitude in the recognition of petitioner union by
respondent company as the exclusive bargaining representative of the workers in
GAW Trading, Inc. under the fluid and amorphous circumstances then obtaining,
was decidedly unwarranted and improvident.
It bears mention that even in cases where it was the then Minister of Labor himself
who directly certified the union as the bargaining representative, this Court voided
such certification where there was a failure to properly determine with legal certainty
whether the union enjoyed a majority representation. In such a case, the holding of a
certification election at a proper time would not necessarily be a mere formality as
there was a compelling reason not to directly and unilaterally certify a union. 7
An additional infirmity of the collective bargaining agreement involved was the
failure to post the same in at least two (2) conspicuous places in the establishment
at least five days before its ratification. 8 Petitioners rationalization was that
"(b)ecause of the real existence of the illegal strike staged by SPFL in all the stores of
GAW Trading, Inc. it had become impossible to comply with the posting requirement
in so far as the realization of tits purpose is concerned as there were no impartial
members of the unit who could be appraised of the CBA's contents. " 9 This
justification is puerile and unacceptable.
In the first place, the posting of copies of the collective bargaining agreement is the
responsibility of the employer which can easily comply with the requirement through
a mere mechanical act. The fact that there were "no impartial members of the unit" is
immaterial. The purpose of the requirement is precisely to inform the employees in
the bargaining unit of the contents of said agreement so that they could intelligently
decide whether to accept the same or not. The assembly of the members of ALU
wherein the agreement in question was allegedly explained does not cure the defect.
The contract is intended for all employees and not only for the members of the
purpoted representative alone. It may even be said the the need to inform the non-
members of the terms thereof is more exigent and compelling since, in all likehood,
their contact with the persons who are supposed to represent them is limited.
Moreover, to repeat, there was an apparent and suspicious hurry in the formulation
and finalization of said collective bargaining accord. In the sforementioned letter
Scroll No. 577
where respondent company required petitioner union to present proof of its support
by the employees, the company already suggested that petitioner ALU at the same
time submit the proposals that it intended to embody in the projected agreement.
This was on May 12, 1986, and prompltly on thre following day the negoltiation
panel; furnish respondent company final copies of the desired agreement whcih, with
equal dispatch, was signed on May 15, 1986.
Another potent reason for annulling the disputed collective bargaining is the finding
of respondent director that one hundred eighty-one( 181) of the two hundred
eighty-one (281) workers who "ratified" the same now " strongly and vehemently
deny and/or repudiate the alleged negotiations and ratification of the CBA.
" 10 Although petitioner claims that only sev en (7) of the repudiating group of
workers belong to the total number who allegedly ratified the agreement,
nevertheless such substantiated contention weighed against the factujal that the
controverted contract will not promote industrial stability . The Court has long since
declared that:
... Basic to the contract bar rule is the proposition that the delay of the right to select
representatives can be justified only where stability is deemed paramount. Excepted
from the contract which do not foster industrial stability, such as contracts where the
identity of the representative is in doubt. Any stability derived from such contracts
must be subordinated to the employees' freedom of choice because it does nto
establish the type of industrial peace contemplated by the law. 11
At this juncture, petitioner should be reminded that the technical rules of rpocedure
do not strictly apply in the adjudication of labor disputes. 12 Consequently, its
objection that the evidence with respect to the aforesaid repudiiation of the
supposed collective bargaining agreement cannot be considered for the first time on
appeal on the Bureau of Labor Relations should be disregarded, especially
considering the weighty significance thereof.
Both petitioner and private respondent GAW Trading, Inc. allege that the employees
of the latter are now enjoying the benefits of the collective bargaining agreement
that both parties had forged. However, We cannot find sufficient evidence of record
to support this contention. The only evidence cited by petitioner is supposed
payment of union fees by said employees, a premise too tenuous to sustain the
desired conclusion. Even the actual number of workers in the respondent company is
not clear from the records. Said private respondent claims that it is two hundred
eighty-one (281) 13 but petitioner suggests that it is more than that number. The said
parties should be aware that this Court is not an adjudicator of facts. Worse, to
borrow a trite but apt phrase, they would heap the Ossa of confusion upon the Pelion
of uncertainty and still expect a definitive ruling on the matter thus confounded.
8|LabRel – Part IV-C
Additionally, the inapplicability of the contract bar rule is further underscored by the
fact that when the disputed agreement was filed before the Labor Regional Office on
May 27, 1986, a petition for certification election had already been filed on May 19,
1986. Although the petition was not supported by the signatures of thirty percent
(30%) of the workers in the bargaining unit, the same was enough to initiate said
certification election.
18. M.Y. SAN BISCUITS, INC. vs. LAGUESMA
ISSUE
Whether or not the med-arbiter or the Secretary of Labor and Employment has the
authority to determine the existence of an employer-employee relationship between
the parties in a petition for certification election. YES. The Secretary of Labor was
correct in denying the petition awaiting the resolution of the NLRC as to the finding
of the existence of employer-employee relationship.
RULING
Under Article 226 of the Labor Code, as amended, the Bureau of Labor Relations
(BLR), of which the med-arbiter is an officer, has the following jurisdiction ––
Art. 226. Bureau of Labor Relations. –– The Bureau of Labor Relations and the Labor
Relations divisions in the regional offices of the Department of Labor 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
work places 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.
The Bureau shall have fifteen (15) working days to act on labor cases before it,
subject to extension by agreement of the parties. (Emphasis supplied.)
From the foregoing, the BLR has the original and exclusive jurisdiction to inter alia,
decide all disputes, grievances or problems arising from or affecting labor-
management relations in all workplaces whether agricultural or non-agricultural.
Necessarily, in the exercise of this jurisdiction over labor-management relations, the
med-arbiter has the authority, original and exclusive, to determine the existence of
an employer-employee relationship between the parties.
Scroll No. 577
Apropos to the present case, once there is a determination as to the existence of
such a relationship, the med-arbiter can then decide the certification election
case.9 As the authority to determine the employer-employee relationship is necessary
and indispensable in the exercise of jurisdiction by the med-arbiter, his finding
thereon may only be reviewed and reversed by the Secretary of Labor who exercises
appellate jurisdiction under Article 259 of the Labor Code, as amended, which
provides ––
Art. 259. Appeal from certification election orders. — Any party to an election may
appeal the order or results of the election as determined by the Med-Arbiter directly
to the Secretary of Labor and Employment on the ground that the rules and
regulations or parts thereof established by the Secretary of Labor and Employment
for the conduct of the election have been violated. Such appeal shall be decided
within fifteen (15) calendar days.
When as in this case Secretary Drilon of DOLE rendered a resolution dated December
15, 1989 reversing the order of the med-arbiter dated August 25, 1989 by declaring
the existence of an employer-employee relationship between the parties, such
finding cannot be rendered nugatory by a contrary finding of the labor arbiter in a
separate dispute for money claims between same parties.
It is absurd to suggest that the med-arbiter and Secretary of Labor cannot make their
own independent finding as to the sentence of such relationship and must have to
rely and wait for such a determination by the labor arbiter or NLRC in a separate
proceeding. For then, given a situation where there is no separate complaint filed
with the labor arbiter, the med-arbiter and/or the Secretary of Labor can never
decide a certification election case or any labor-management dispute properly
brought before them as they have no authority to determine the existence of an
employer-employee relationship. Such a proposition is, to say the least, anomalous.
Correctly indeed, the Secretary of Labor denied the prayer in the manifestation of
petitioner to await the resolution of the NLRC as to the existence of such employer-
employee relationship.
The Court reproduces with approval the findings and conclusions of the Secretary in
the said resolution dated December 15, 1989.
The sole issue to be resolved is whether or not there exists an employer-employee
relationship between members of petitioning union and the company.
After a careful review of the records of the case, we find for the appellant.
9|LabRel – Part IV-C
It has been well settled in jurisprudence that the factors to be considered in
determining the existence of employer-employee relationship are as follows: (a)
selection and engagement of the employees; (b) the payment of wages; (e) the
process [sic] of dismissal; and, (d) the employer's power to control the employee with
respect to the means and methods [with] which the work is to be accomplished.
On the first factor, (selection and engagement of the employer), [sic] it is very
apparent from the records that the personnel of M.Y. San Biscuits are the one
responsible for hiring of employees. Assuming, it is the salesman that engages his
own driver, it could be inferred however that such authority emanates from the
respondent.
On the second factor (payment of wages), while the respondent tried to impress
upon us that the drivers/helpers are not in the payroll of the company and, therefore,
not receiving salaries from it, this at best is but an administrative arrangement in
order to save the respondent from the burden of keeping records and other indirect
cost.
On the third factor, (the power of dismissal), it is very clear that herein respondent is
the authority that imposes disciplinary measures against erring drivers. This alone
proves that it wields disciplinary authority over the drivers/helpers.
Finally, on the fourth factor which is the control test, the fact that the respondent
gives daily instructions to the drivers on how to go about their work is sufficient
indication that it exercises control over the movements of the drivers/helpers. The
drivers are instructed as to what time they are supposed to report to the office and
what time they are supposed to return.
Viewed from the above circumstances, it is every clear that the herein respondent is
the real employer of the drivers/helpers. They are in truth and in fact the employees
of the respondent and its attempt to seek refuge on its salesmen as the ostensible
employer of the drivers/helpers was nothing but an elaborate scheme to deprive
drivers/helpers their right to self-organization.
19. LAGUNA AUTOPARTS MANUFACTURING CORPORATION vs. OFFICE OF THE
SECRETARY
ISSUES
1. WON the union is a LLO.
2. WON a chapter’s legal personality may be collaterally attacked in a PCE.
3. WON the company as employer has the legal standing to oppose the PCE.
Scroll No. 577
RULING
1. YES. A local or chapter need not be independently registered to acquire legal
personality.
Sec.3 Rule VI of IRR of Book V as amended by DO No. 9 states: A local/chapter shall
acquire legal personality from the date of filing of the complete documents
enumerated therein. Upon compliance with all documentary requirements, the
Regional Office shall issue in favour of the local/chapter a certificate indicating that it
is included in the roster of LLOs.
The Regional Office has determined that the union complied with the requirements
under the law, it therefore, declared that the union has acquired legal personality as
a labor organization.
2. NO. The legal personality may not be collaterally attacked but only through a
separate action instituted particularly for the purpose of assailing it.
Sec.5 Rule V of IRR of Book V states: Effect of registration. 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. Such legal personality cannot
thereafter be subject to collateral attack but may be questioned only in an
independent petition for cancellation in accordance with these Rules.
The legal personality of a union cannot be subject of collateral attack in a PCE, but
may be questioned only in an independent petition for cancellation of union
registration.
Sec. 11 Paragraph II Rule IX of D.O 9 provides: for the dismissal of PCE based on the
lack of legal personality of LO only in following instances:
1. union is not listed by the Regional Office or the BLR in its registry of LLOs,
2. Union’s legal personality has been revoked or cancelled with finality,
Since the union is listed in the registry of LLOs, and its legitimacy has not been
revoked or cancelled with finality, the granting of its petition for certification election
is proper.
3. NO. The choice of collective bargaining agent is the sole concern of the employees.
The only exception to this rule is where the employer has to file the PCE pursuant to
Article 258 LC because it was requested to bargain collectively which exception finds
no application in this case. The role of the employer in the PCE is a mere bystander.
20. SAMAHAN NG MGA MANGGAGAWA SA FILSYSTEMS versus SECRETARY OF
LABOR AND EMPLOYMENT
ISSUE
WON the the representation case was rendered moot and academic by the
subsequent collective bargaining agreement of the company and the new EBR
WON the union had validly complied with the requirements for registration
10|LabRel – Part IV-C

RULING
I all bona fide employees in the bargaining unit, whether they are members of a labor
First, The reasoning of the public respondent and the Med-Arbiter is flawed,
proceeding as it does from a wrong premise. Firstly, it must be underscored that
petitioner is an independently registered labor union as evidenced by a Certificate of
Registration issued by the DOLE. As a legitimate labor organization, petitioner's right
to file apetition for certification election on its own is beyond question.
Secondly, the failure of petitioner to prove its affiliation with NAFLU-KMU cannot
affect its right to file said petition for certification election as an independent union.
At the most, petitioner's failure will result in an ineffective affiliation with NAFLU-
KMU. Still, however, it can pursue its petition for certification election as an
independent union. In our rulings, we have stressed that despite affiliation, the local
union remains the basic unit free to serve the common interest of all its members
and pursue its own interests independently of the federation.
Public respondent's ruling is anchored on his finding that there exists no pending
representation case since the petition for certification election filed by the petitioner
was dismissed by the Med-Arbiter.
We reject public respondent's ruling. The order of the Med-Arbiter dismissing
petitioner's petition for certification election was seasonably appealed. The appeal
stopped the holding of any certification election. Section 10, Rule V of the
Implementing Rules of Book V of the Labor Code is crystal clear and hardly needs any
interpretation.
II
Accordingly, there was an unresolved representation case at the time the CBA was
entered between FWU and private respondent. Following Section 4, Rule V of the
Implementing Rules of Book V of the Labor Code, such CBA cannot and will not
prejudice petitioner's pending representation case or render the same moot.
Time and again, we have emphasized that when a petition for certification election is
filed by a legitimate labor organization, it is good policy for the employer not to have
any participation or partisan interest in the choice of the bargaining representative.
While employers may rightfully be notified or informed of petitions of such nature,
they should not, however, be considered parties thereto with an inalienable right to
oppose it.
21. ALEXANDER REYES vs. TRAJANO
ISSUE
WON the members of the INC should not be allowed to vote “because they refused
to participate in the previous certification elections.”
RULING
Scroll No. 577
No. Neither law, administrative rule nor jurisprudence requires that only employees
affiliated with any labor organization may take part in a certification election. On the
contrary, the plainly discernible intendment of the law is to grant the right to vote to
organization or not. As held in Airtime Specialists, Inc. v. Ferrer-Calleja: 9
In a certification election all rank-and-file employees in the appropriate bargaining
unit are entitled to vote. This principle is clearly stated in Art. 255 of the Labor Code
which states that the "labor organization designated or selected by the majority of
the employees in an appropriate bargaining unit shall be the exclusive representative
of the employees in such unit for the purpose of collective bargaining." Collective
bargaining covers all aspects of the employment relation and the resultant CBA
negotiated by the certified union binds all employees in the bargaining unit. Hence,
all rank-and-file employees, probationary or permanent, have a substantial interest in
the selection of the bargaining representative. The Code makes no distinction as to
their employment for certification election. The law refers to "all" the employees in
the bargaining unit. All they need to be eligible to support the petition is to belong to
the "bargaining unit".
Neither does the contention that petitioners should be denied the right to
vote because they "did not participate in previous certification elections in
the company for the reason that their religious beliefs do not allow them to
form, join or assist labor organizations," persuade acceptance. No law,
administrative rule or precedent prescribes forfeiture of the right to vote by
reason of neglect to exercise the right in past certification elections. In
denying the petitioners' right to vote upon these egregiously fallacious
grounds, the public respondents exercised their discretion whimsically,
capriciously and oppressively and gravely abused the same.
22. CHRIS GARMENTS CORPORATION vs. HON. STO. TOMAS
ISSUE
(1) Is a motion for reconsideration necessary before a party can file a petition for
certiorari from the decision of the Secretary of Labor and Employment? NO
RULING
It is settled that the filing of a motion for reconsideration is a prerequisite to the filing
of a special civil action for certiorari to give the lower court the opportunity to correct
itself. This rule, however, admits of exceptions, such as when a motion for
reconsideration would be useless under the circumstances.
11|LabRel – Part IV-C
 Under Department Order No. 40-03, Series of 2003, the decision of the
Secretary of Labor and Employment shall be final and executory after ten days from
receipt thereof by the parties and that it shall not be subject of a motion for
reconsideration.
In this case, the Decision dated January 18, 2005 of the Secretary of Labor
and Employment was received by petitioner on January 25, 2005. It would have
become final and executory on February 4, 2005, the tenth day from petitioner’s
receipt of the decision. However, petitioner filed a petition for certiorari with the
Court of Appeals on even date. Clearly, petitioner availed of the proper remedy since
Department Order No. 40-03 explicitly prohibits the filing of a motion for
reconsideration. Such motion becomes dispensable and not at all necessary.
(2) Is the case barred by res judicata or conclusiveness of judgment? NO
Ruling: The elements of res judicata are: (1) the judgment sought to bar the new
action must be final; (2) the decision must have been rendered by a court having
jurisdiction over the subject matter and the parties; (3) the disposition of the case
must be a judgment on the merits; and (4) there must be as between the first and
second action, identity of parties, subject matter, and causes of action.
In the instant case, there is no dispute as to the presence of the first three
elements of res judicata. The Resolution dated December 27, 2002 of the Secretary of
Labor and Employment on the first petition for certification election became final and
executory. It was rendered on the merits and the Secretary of Labor and Employment
had jurisdiction over the case. Is the fourth element – identity of parties, subject
matter, and causes of action between the first and third petitions for certification
election – present? We hold in the negative.
The Secretary of Labor and Employment dismissed the first petition as it was
filed outside the 60-day freedom period. At that time, the union has no cause of
action since they are not yet legally allowed to challenge the status of SMCGC-SUPER
as the EBR of the bargaining unit. Such dismissal, however, has no bearing in the
instant case since the third petition for certification election was filed well within the
60-day freedom period. Otherwise stated, there is no identity of causes of action to
speak of since in the first petition, the union has no cause of action while in the third,
a cause of action already exists for the union as they are now legally allowed to
challenge the status of SMCGC-SUPER as exclusive bargaining representative.
(3) Is there an employer-employee relationship between petitioner and the union
members. YES
Scroll No. 577
Ruling: The matter has been resolved with finality by the Secretary of Labor and
Employment. Petitioner did not appeal this factual finding, it may be considered as
the final resolution of such issue. To reiterate, "conclusiveness of judgment" has the
effect of preclusion of issues.
23. NATIONAL UNION OF WORKERS IN HOTELS, RESTAURANTS AND ALLIED
INDUSTRIES- MANILA PAVILION HOTEL CHAPTER, - versus – SECRETARY OF
LABOR AND EMPLOYMENT,
ISSUE
WON employees on probationary status at the time of the certification elections be
allowed to vote?
RULING
YES. The votes of the six other probationary employees should thus also have been
counted. In a certification election, all rank and file employees in the appropriate
bargaining unit, whether probationary or permanent are entitled to vote. This
principle is clearly stated in Art. 255 of the Labor Code which states that the "labor
organization designated or selected by the majority of the employees in an
appropriate bargaining unit shall be the exclusive representative of the employees in
such unit for purposes of collective bargaining."
Collective bargaining covers all aspects of the employment relation and the resultant
CBA negotiated by the certified union binds all employees in the bargaining unit.
Hence, all rank and file employees, probationary or permanent, have a substantial
interest in the selection of the bargaining representative. The Code makes no
distinction as to their employment status as basis for eligibility in supporting the
petition for certification election. The law refers to "all" the employees in the
bargaining unit. All they need to be eligible to support the petition is to belong to the
"bargaining unit."
The provision in the CBA disqualifying probationary employees from voting cannot
override the Constitutionally-protected right of workers to self-organization, as well
as the provisions of the Labor Code and its Implementing Rules on certification
elections and jurisprudence thereon. A law is read into, and forms part of, a contract.
Provisions in a contract are valid only if they are not contrary to law, morals, good
customs, public order or public policy.
But while the Court rules that the votes of all the probationary employees should be
included, under the particular circumstances of this case and the period of time which
12|LabRel – Part IV-C
it took for the appeal to be decided, the votes of the six supervisory employees must
be excluded because at the time the certification elections was conducted, they had
ceased to be part of the rank and file, their promotion having taken effect two
months before the election
B. COLLECTIVE BARGAINING AND ADMINISTRATION OF AGREEMENT
24. KIOK LOY, vs. NLRC
ISSUE
WON the NLRC is correct in declaring the Company guilty of unfair labor practice.
HELD
Yes. Collective bargaining which is defined as negotiations towards a collective
agreement, is one of the democratic frameworks under the New Labor Code,
designed to stabilize the relation between labor and management and to create a
climate of sound and stable industrial peace. It is a mutual responsibility of the
employer and the Union and is characterized as a legal obligation. So much so that
Article 249, par. (g) of the Labor Code makes it an unfair labor practice for an
employer to refuse "to meet and convene promptly and expeditiously in good faith
for the purpose of negotiating an agreement with respect to wages, hours of work,
and all other terms and conditions of employment including proposals for adjusting
any grievance or question arising under such an agreement and executing a contract
incorporating such agreement, if requested by either party.
The mechanics of collective bargaining is set in motion only when the following
jurisdictional preconditions are present, namely, (1) possession of the status of
majority representation of the employees' representative in accordance with any of
the means of selection or designation provided for by the Labor Code; (2) proof of
majority representation; and (3) a demand to bargain under Article 251, par. (a) of
the New Labor Code . ... all of which preconditions are undisputedly present in the
instant case.
The petitioner Company is GUILTY of unfair labor practice. Respondent Union made a
definite request to bargain, accompanied with a copy of the proposed Collective
Bargaining Agreement, to the Company not only once but twice which were left
unanswered and unacted upon. The Company made no counter proposal whatsoever
all of which conclusively indicate lack of a sincere desire to negotiate. A Company's
Scroll No. 577
refusal to make counter proposal if considered in relation to the entire bargaining
process, may indicate bad faith and this is specially true where the Union's request
for a counter proposal is left unanswered. Even during the period of compulsory
arbitration before the NLRC, petitioner Company's approach and attitude-stalling the
negotiation by a series of postponements, non-appearance at the hearing conducted,
and undue delay in submitting its financial statements, lead to no other conclusion
except that it is unwilling to negotiate and reach an agreement with the Union.
The moves and overall behavior of petitioner-company were in total derogation of
the policy enshrined in the New Labor Code which is aimed towards expediting
settlement of economic disputes.
25. LAKAS NG MANGGAGAWANG MAKABAYAN (LAKAS vs. MARCELO
ENTERPRISES
Brief facts: the CBA expired, there were actually 3 bargaining units here who were in
dispute to be the sole bargaining agent. On different occasions, the 3 bargaining units
requested with the management to sit down with them for purposes of collective
bargaining. The latter refused. Hence this petition.
ISSUE
WON the management is justified in refusing to bargain with the 3 bargaining units
which would constitute as an unfair labor practice.
HELD
 The present controversy is a three-sided conflict, although focus has been
greatly placed upon an alleged labor dispute between complainant LAKAS
and the respondent Marcelo Companies.
 It would bear emphasizing, however, that what had been patently
disregarded by the respondent industrial court and the parties alike, is the
fact that LAKAS had never been the bargaining representative of any and an
of the local unions then existing in the respondent Marcelo Companies.
 Contrary to the pretensions of complainant LAKAS, the respondent Marcelo
Companies did not ignore the demand for collective bargaining contained in
its letter of June 20, 1967.
 Neither did the companies refuse to bargain at all. What it did was to apprise
LAKAS of the existing conflicting demands for recognition as the bargaining
representative in the appropriate units involved, and suggested the
13|LabRel – Part IV-C
 settlement of the issue by means of the filing of a petition for certification
election before the Court of Industrial Relations.
 This was not only the legally approved procedure but was dictated by the
fact that there was indeed a legitimate representation issue. PSSLU, with
whom the existing CBAs were entered into, was demanding of respondent
companies to collectively bargain with it; so was Paulino Lazaro of MUEWA,
J.C. Espinas& Associates for MACATIFU and the MFWU, and the complainant
LAKAS for MULU which we understand is the aggrupation of MACATIFU,
MFWU and UNWU.
In Philippine Association of Free Labor Unions (PAFLU) vs. The Bureau of Labor
Relations:
..., in a situation like this where the issue of legitimate representation in dispute
is viewed for not only by one legitimate labor organization but two or more,
there is every equitable ground warranting the holding of a certification election.
In this way, the issue as to who is really the true bargaining representative of all
the employees may be firmly settled by the simple expedient of an election.
 The above-cited case gives the reason for the need of determining once and
for all the true choice of membership as to who should be their bargaining
representative, which is that, "(E)xperience teaches us, one of the root
causes of labor or industrial disputes is the problem arising from a
questionable bargaining representative entering into CBA concerning terms
and conditions of employment. "
 It is essential to the right of a putative bargaining agent to represent the
employees that it be the delegate of a majority of the employees and,
conversely, an employer is under duty to bargain collectively only when the
bargaining agent is representative of the majority of the employees.
 A natural consequence of these principles is that the employer has the right
to demand of the asserted bargaining agent proof of its representation of its
employees.
 Having the right to demonstration of this fact, it is not an 'unfair labor
practice' for an employer to refuse to negotiate until the asserted bargaining
agent has presented reasonable proof of majority representation.
 It is necessary however, that such demand be made in good faith and not
merely as a pretext or device for delay or evasion. The employer's right is
however to reasonable proof.
Scroll No. 577
 The clear facts of the case as hereinbefore restated indusputably show that a
legitimate representation issue confronted the respondent Marcelo
Companies. In the face of these facts and in conformity with the existing
jurisprudence.
We hold that there existed no duty to bargain collectively with LAKAS on the part of
said companies
26. DIVINE WORD UNIVERSITY OF TACLOBAN v. SECRETARY OF LABOR AND
EMPLOYMENT
ISSUE
WON there was good faith in collective bargaining.NO!!!
HELD
A "deadlock" is defined as the "counteraction of things producing entire stoppage: a
state of inaction or of neutralization caused by the opposition of persons or of
factions (as in government or a voting body): standstill." 21 There is a deadlock when
there is a "complete blocking or stoppage resulting from the action of equal and
opposed forces; as, the deadlock of a jury or legislature." 22 The word is synonymous
with the word impasse 23 which, within the meaning of the American federal labor
laws, "presupposes reasonable effort at good faith bargaining which, despite noble
intentions, does not conclude in agreement between the parties." 24
A thorough study of the records reveals that there was no "reasonable effort at good
faith bargaining" specially on the part of the University. Its indifferent attitude
towards collective bargaining inevitably resulted in the failure of the parties to arrive
at an agreement. As it was evident that unilateral moves were being undertaken only
by the DWUEU-ALU, there was no "counteraction" of forces or an impasse to speak
of. While collective bargaining should be initiated by the union, there is a
corresponding responsibility on the part of the employer to respond in some manner
to such acts. This is clear from the provisions of the Labor Code Art. 250(a) of which
states:
"ART. 250. Procedure in collective bargaining. — The following procedures shall be
observed in collective bargaining:
14|LabRel – Part IV-C
(a) When a party desires to negotiate an agreement, it shall serve a written notice
upon the other party with a statement of its proposals. The other party shall make a
reply thereto not later than ten (10) calendar days from receipt of such notice.
(b) Should differences arise on the basis of such notice and reply, either party may
request for a conference which shall begin not later than ten (10) calendar days from
the date of request.
(c) If the dispute is not settled, the Board shall intervene upon request of either or
both parties or at its own initiative and immediately call the parties to conciliation
meetings. The Board shall have the power to issue subpoenas requiring the
attendance of the parties to such meetings. It shall be the duty of the parties to
participate fully and promptly in the conciliation meetings the Board may call;
(d) During the conciliation proceedings in the Board, the parties are prohibited from
doing any act which may disrupt or impede the early settlement of the disputes; and
(e) The Board shall exert all efforts to settle disputes amicably and encourage the
parties to submit their case to a voluntary arbitrator."
Considering the procedure outlined above, the Court cannot help but notice that
the DWUEU was not entirely blameless in the matter of the delay in the bargaining
process. While it is true that as early as March 7, 1985, said union had submitted its
collective bargaining proposals and that, its subsequent withdrawal by the DWUEU
Vice-President being unauthorized and therefore ineffective, the same proposals
could be considered as subsisting, the fact remains that said union remained passive
for three years. The records do not show that during this three-year period, it
exerted any effort to pursue collective bargaining as a means of attaining better
terms of employment.
It was only after its affiliation with the ALU that the same union, through the ALU
Director for Operations, requested an "initial conference" for the purpose of
collective bargaining. That the DWUEU abandoned its collective bargaining proposals
prior to its affiliation with ALU is further confirmed by the fact that in the
aforequoted May 10, 1988 agreement with the University, said Union bound itself to
submit a new set of proposals on May 13, 1988. Under the circumstances, the
agreement of May 10, 1988 may as well be considered the written notice to bargain
referred to in the aforequoted Art. 250(a) of the Labor Code, which thereby set into
Scroll No. 577
motion the machinery for collective bargaining, as in fact, on May 19, 1988, DWUEU-
ALU submitted its collective bargaining proposals.
Be that as it may, the Court is not inclined to rule that there has been a deadlock or
an impasse in the collective bargaining process. As the Court earlier observed, there
has not been a "reasonable effort at good faith bargaining" on the part of the
University. While DWUEU-ALU was opening all possible avenues for the conclusion of
an agreement, the record is replete with evidence on the University’s reluctance and
thinly disguised refusal to bargain with the duly certified bargaining agent, such that
the inescapable conclusion is that the University evidently had no intention of
bargaining with it. Thus, while the Court recognizes that technically, the University
has the right to file the petition for certification election as there was no bargaining
deadlock to speak of, to grant its prayer that the herein assailed Orders be annulled
would put an unjustified premium on bad faith bargaining.
Bad faith on the part of the University is further exemplified by the fact that an hour
before the start of the May 10, 1988 conference, it surreptitiously filed the petition
for certification election. And yet during said conference, it committed itself to "sit
down" with the Union. Obviously, the University tried to preempt the conference
which would have legally foreclosed its right to file the petition for certification
election. In so doing, the University failed to act in accordance with Art. 252 of the
Labor Code which defines the meaning of the duty to bargain collectively as "the
performance of a mutual obligation to meet and convene promptly and
expeditiously in good faith." Moreover, by filing the petition for certification election
while agreeing to confer with the DWUEU-ALU, the University violated the mandate
of Art. 19 of the Civil Code that" (e)very person must, in the exercise of his rights and
in the performance of his duties, act with justice, give everyone his due, and observe
honesty and good faith."
Moreover, the University’s unscrupulous attitude towards the DWUEU-ALU is also
betrayed by its belated questioning of the status of the said union. The
communications between them afforded the University ample opportunity to raise
the issue of representation if indeed it was doubtful of the DWUEU-ALU’s status as a
majority union, but it failed to do so. On the other hand, in the agreement of May 10,
1988, the University even agreed "to sit down and determine the number of
employees that will represent their bargaining unit." This clearly indicates that the
University recognized the DWUEU-ALU as the bargaining representative of the
15|LabRel – Part IV-C
employees and is, therefore, estopped from questioning the majority status of the
said union.
Hence, petitioner’s contention that the DWUEU-ALU’s proposals may not be
unilaterally imposed on it on the ground that a collective bargaining agreement is a
contract wherein the consent of both parties is indispensable is devoid of merit. A
similar argument had already been disregarded in the case of Kiok Loy v. NLRC, 26
where we upheld the order of the NLRC declaring the union’s draft CBA proposal as
the collective agreement which should govern the relationship between the parties.
Kiok Loy v. NLRC is applicable in the instant case considering that the facts therein
have also been indubitably established in this case. These factors are: (a) the union is
the duly certified bargaining agent; (b) it made a definite request to bargain and
submitted its collective bargaining proposals, and (c) the University made no counter
proposal whatsoever. As we said in Kiok Loy," [a] company’s refusal to make counter
proposal if considered in relation to the entire bargaining process, may indicate bad
faith and this is especially true where the Union’s request for a counter proposal is
left unanswered." 27 Moreover, the Court added in the same case that "it is not
obligatory upon either side of a labor controversy to precipitately accept or agree to
the proposals of the other. But an erring party should not be tolerated and allowed
with impunity to resort to schemes feigning negotiations by going through empty
gestures."
That being the case, the petitioner may not validly assert that its consent should be a
primordial consideration in the bargaining process. By its acts, no less than its
inaction which bespeak its insincerity, it has forfeited whatever rights it could have
asserted as an employer. We, therefore, find it superfluous to discuss the two other
contentions in its petition.
27. SAMAHANG MANGGAGAWA SA TOP FORM MANUFACTURING UNITED
WORKERS OF THE PHILIPPINES vs. NLRC
ISSUE
Whether or not private respondent committed an unfair labor practice in its refusal
to grant across-the-board wage increases in implementing Wage Orders Nos. 01 and
02.NO!!!
Scroll No. 577
HELD
With respect to the first issue, petitioner union anchors its arguments on the alleged
commitment of private respondent to grant an automatic across-the-board wage
increase in the event that a statutory or legislated wage increase is promulgated. It
cites as basis therefor, the aforequoted portion of the Minutes of the collective
bargaining negotiation on February 27, 1990 regarding wages, arguing additionally
that said Minutes forms part of the entire agreement between the parties.
The basic premise of this argument is definitely untenable. To start with, if there was
indeed a promise or undertaking on the part of private respondent to obligate itself
to grant an automatic across-the-board wage increase, petitioner union should have
requested or demanded that such "promise or undertaking" be incorporated in the
CBA. After all, petitioner union has the means under the law to compel private
respondent to incorporate this specific economic proposal in the CBA. It could have
invoked Article 252 of the Labor Code defining "duty to bargain," thus, the duty
includes "executing a contract incorporating such agreements if requested by either
party." Petitioner union's assertion that it had insisted on the incorporation of the
same proposal may have a factual basis considering the allegations in the
aforementioned joint affidavit of its members. However, Article 252 also states that
the duty to bargain "does not compel any party to agree to a proposal or make any
concession." Thus, petitioner union may not validly claim that the proposal
embodied in the Minutes of the negotiation forms part of the CBA that it finally
entered into with private respondent.
The CBA is the law between the contracting parties 10 — the collective bargaining
representative and the employer-company. Compliance with a CBA is mandated by
the expressed policy to give protection to labor. 11 In the same vein, CBA provisions
should be "construed liberally rather than narrowly and technically, and the courts
must place a practical and realistic construction upon it, giving due consideration to
the context in which it is negotiated and purpose which it is intended to
serve." 12 This is founded on the dictum that a CBA is not an ordinary contract but one
impressed with public interest. 13 It goes without saying, however, that only
provisions embodied in the CBA should be so interpreted and complied with. Where a
proposal raised by a contracting party does not find print in the CBA, 14 it is not a part
thereof and the proponent has no claim whatsoever to its implementation.
16|LabRel – Part IV-C
Hence, petitioner union's contention that the Minutes of the collective bargaining
negotiation meeting forms part of the entire agreement is pointless. The Minutes
reflects the proceedings and discussions undertaken in the process of bargaining for
worker benefits in the same way that the minutes of court proceedings show what
transpired therein. 15 At the negotiations, it is but natural for both management and
labor to adopt positions or make demands and offer proposals and counter-
proposals. However, nothing is considered final until the parties have reached an
agreement. In fact, one of management's usual negotiation strategies is to ". . . agree
tentatively as you go along with the understanding that nothing is binding until the
entire agreement is reached." 16 If indeed private respondent promised to continue
with the practice of granting across-the-board salary increases ordered by the
government, such promise could only be demandable in law if incorporated in the
CBA.
Moreover, by making such promise, private respondent may not be considered in bad
faith or at the very least, resorting to the scheme of feigning to undertake the
negotiation proceedings through empty promises. As earlier stated, petitioner union
had, under the law, the right and the opportunity to insist on
the foreseeable fulfillment of the private respondent's promise by demanding its
incorporation in the CBA. Because the proposal was never embodied in the CBA, the
promise has remained just that, a promise, the implementation of which cannot be
validly demanded under the law.
The Court likewise finds unmeritorious petitioner union's contention that by its
failure to grant across-the-board wage increases, private respondent violated the
provisions of Section 5, Article VII of the existing CBA 26 as well as Article 100 of the
Labor Code. The CBA provision states:
Sec. 5. The COMPANY agrees to comply with all the applicable provisions of the Labor
Code of the Philippines, as amended, and all other laws, decrees, orders, instructions,
jurisprudence, rules and regulations affecting labor.
Art. 100 of the Labor Code on prohibition against elimination or diminution of
benefits provides that "(n)othing in this Book shall be construed to eliminate or in any
way diminish supplements, or other employee benefits being enjoyed at the time of
promulgation of this Code."
Scroll No. 577
We agree with the Labor Arbiter and the NLRC that no benefits or privileges
previously enjoyed by petitioner union and the other employees were withdrawn
as a result of the manner by which private respondent implemented the wage
orders. Granted that private respondent had granted an across-the-board increase
pursuant to Republic Act No. 6727, that single instance may not be considered an
established company practice. Petitioner union's argument in this regard is actually
tied up with its claim that the implementation of Wage Orders Nos. 01 and 02 by
private respondent resulted in wage distortion.
28. UNION OF FILIPINO EMPLOYEES- DRUG, FOOD AND ALLIED INDUSTRIES
UNION- KILUSANG MAYO UNO (UFE-DFA-KMU) VS. NESTLE PHILIPPINES
INCORPORATED
ISSUES
1. WON Nestle was guilty of ULP.
2. WON retirement plan is a valid issue to be tackled during the CBA
negotiation.
HELD
1. NO.
The duty to bargain collectively is mandated by Article 252 and 253 of the Labor
Code.The purpose of collective bargaining is the reaching of an agreement
resulting in a contract binding on the parties; but the failure to reach an
agreement after negotiations have continue for a reasonable period does not
establish a lack of good faith. The statutes invite and contemplate a collective
bargaining contract, but they do not compel one. The duty to bargain does not
include the obligation to reach an agreement.
There is no per se test of good faith in bargaining. The effect of an employer’s or
a union’s individual actions is not the test of good faith bargaining, but the
impact of all such occasions or actions, considered as a whole. For a charge of
ULP to prosper, it must be shown that Nestle was motivated by ill will, bad faith,
or fraud, or was oppressive to labor or done in a manner contrary to morals,
good customs or public policy. All the law contemplates is that both parties
should approach the negotiation with an open mind and make reasonable effort
to reach a common ground of agreement.
17|LabRel – Part IV-C
 The counter-proposal of Nestle is not tantamount to refusal to bargain. In
thinking to exclude the issue of retirement plan from CBA negotiations, Nestle
cannot be faulted for considering the same benefits as unilaterally granted,
considering that 8 out of 9 bargaining units have agreed to treat the Retirement
plan as unilaterally granted benefit. Nestle’s desire to settle the dispute and
proceed with the negotiation being evident in its cry for compulsory arbitration
is proof enough of its exertion of reasonable effort at good faith bargaining. An
employer’s steadfast insistence to exclude a particular substantive provision is
no different from a bargaining representative’s perseverance to include one
that they deem of absolute necessity. It is but natural that at negotiations,
management and labor adopt positions or make demands and offer proposals
and counter-proposals.
2. YES
The retirement plan is a valid issue in the collective bargaining negotiation
between the union and Nestle. But the parties are not directed to negotiate by
themselves the tenor of the retirement plant; since the SOLE had already
acquired jurisdiction over the labor dispute, the issue concerning the retirement
benefits must be remanded back to him for proper disposition. SOLE has been
explicitly granted by Article 263 (g) LC the authority to assume jurisdiction over
a labor dispute causing or likely to cause a strike or lockout in an industry
indispensable to the national interest, and decide the same accordingly. It
includes questions incidental to the labor dispute, that is, issues that are
necessarily involved in the dispute itself, and not just to that ascribed in the
Notice of Strike or otherwise submitted to him for resolution.
29. COLEGIO DE SAN JUAN DE LETRAN vs. ASSOCIATION OF EMPLOYEES AND
FACULTY OF LETRAN and ELEONOR AMBAS
ISSUES
(1) WON petitioner is guilty of unfair labor practice by refusing to bargain with the
union when it unilaterally suspended the ongoing negotiations for a new Collective
Bargaining Agreement (CBA) upon mere information that a petition for certification
has been filed by another legitimate labor organization?
(2) WON the termination of the union president amounts to an interference of the
employees' right to self-organization?
Scroll No. 577
HELD
1. YES. Petitioner is guilty of unfair labor practice by its stern refusal to
bargain in good faith with respondent union. Article 252 of the Labor Code defines
the meaning of the phrase "duty to bargain collectively," as follows:
Art. 252. Meaning of duty to bargain collectively. - The duty to bargain collectively
means the performance of a mutual obligation to meet and convene promptly and
expeditiously in good faith for the purpose of negotiating an agreement with respect
to wages, hours of work and all other terms and conditions of employment including
proposals for adjusting any grievances or questions arising under such agreement and
executing a contract incorporating such agreements if requested by either party but
such duty does not compel any party to agree to a proposal or to make any
concession.
Noteworthy in the above definition is the requirement on both parties of the
performance of the mutual obligation to meet and convene promptly and
expeditiously in good faith for the purpose of negotiating an agreement.
Undoubtedly, respondent Association of Employees and Faculty of Letran (AEFL)
(hereinafter, "union") lived up to this requisite when it presented its proposals for the
CBA to petitioner on February 7, 1996. On the other hand, petitioner devised ways
and means in order to prevent the negotiation.
Petitioner's utter lack of interest in bargaining with the union is obvious in its failure
to make a timely reply to the proposals presented by the latter. More than a month
after the proposals were submitted by the union, petitioner still had not made any
counter-proposals. This inaction on the part of petitioner prompted the union to file
its second notice of strike on March 13, 1996. Petitioner could only offer a feeble
explanation that the Board of Trustees had not yet convened to discuss the matter as
its excuse for failing to file its reply. This is a clear violation of Article 250 of the Labor
Code governing the procedure in collective bargaining, to wit:
Art. 250. Procedure in collective bargaining. - The following procedures shall be
observed in collective bargaining:
(a) When a party desires to negotiate an agreement, it shall serve a written notice
upon the other party with a statement of its proposals.The other party shall make a
reply thereto not later than ten (10) calendar days from receipt of such notice. 4x x x
18|LabRel – Part IV-C
Moreover, the series of events that transpired after the filing of the first notice of
strike in January 1996 show petitioner's resort to delaying tactics to ensure that
negotiation would not push through. Thus, on February 15, 1996, or barely a few days
after the union proposals for the new CBA were submitted, the union president was
informed by her superior that her work schedule was being changed from Mondays
to Fridays to Tuesdays to Saturdays. A request from the union president that the
issue be submitted to a grievance machinery was subsequently denied. Thereafter,
the petitioner and the union met on March 27, 1996 to discuss the ground rules for
negotiation. However, just two days later, or on March 29, 1996, petitioner dismissed
the union president for alleged insubordination. In its final attempt to thwart the
bargaining process, petitioner suspended the negotiation on the ground that it
allegedly received information that a new group of employees called the Association
of Concerned Employees of Colegio (ACEC) had filed a petition for certification
election. Clearly, petitioner tried to evade its duty to bargain collectively.
Petitioner, likewise, claims that the suspension of negotiation was proper since by the
filing of the petition for certification election the issue on majority representation of
the employees has arose. Petitioner asserts quoting Lakas Ng Manggagawang
Makabayan v. Marcelo Enterprises that in view of the pendency of the petition for
certification election, it had no duty to bargain collectively with the union.
We disagree. In order to allow the employer to validly suspend the bargaining process
there must be a valid petition for certification election raising a legitimate
representation issue. Hence, the mere filing of a petition for certification election
does notipso factojustify the suspension of negotiation by the employer. The petition
must first comply with the provisions of the Labor Code and its Implementing Rules.
Foremost is that a petition for certification election must be filed during the sixty-day
freedom period. No petition for certification election for any representation issue
may be filed after the lapse of the sixty-day freedom period. The old CBA is extended
until a new one is signed. The rule is that despite the lapse of the formal effectivity of
the CBA the law still considers the same as continuing in force and effect until a new
CBA shall have been validly executed. Hence, the contract bar rule still applies.The
purpose is to ensure stability in the relationship of the workers and the company by
preventing frequent modifications of any CBA earlier entered into by them in good
faith and for the stipulated original period.11
In the case at bar, the lifetime of the previous CBA was from 1989-1994.The petition
for certification election by ACEC, allegedly a legitimate labor organization, was filed
Scroll No. 577
with the Department of Labor and Employment (DOLE) only on May 26, 1996. Clearly,
the petition was filed outside the sixty-day freedom period. Hence, the filing thereof
was barred by the existence of a valid and existing collective bargaining agreement.
Consequently, there is no legitimate representation issue and, as such, the filing of
the petition for certification election did not constitute a bar to the ongoing
negotiation. Reliance, therefore, by petitioner of the ruling inLakas Ng
Manggagawang Makabayan v. Marcelo Enterprisesis misplaced since that case
involved a legitimate representation issue which is not present in the case at bar.
2. The dismissal was effected in violation of the employees' right to self-
organization.
The factual backdrop of the termination of Ms. Ambas leads us to no other conclusion
that she was dismissed in order to strip the union of a leader who would fight for the
right of her co-workers at the bargaining table. Ms. Ambas, at the time of her
dismissal, had been working for the petitioner for ten (10) years already. In fact, she
was a recipient of a loyalty award. Moreover, for the past ten (10) years her working
schedule was from Monday to Friday. However, things began to change when she
was elected as union president and when she started negotiating for a new CBA.
Thus, it was when she was the union president and during the period of tense and
difficult negotiations when her work schedule was altered from Mondays to Fridays
to Tuesdays to Saturdays. When she did not budge, although her schedule was
changed, she was outrightly dismissed for alleged insubordination.
Admittedly, management has the prerogative to discipline its employees for
insubordination.But when the exercise of such management right tends to interfere
with the employees' right to self-organization, it amounts to union-busting and is
therefore a prohibited act.The dismissal of Ms. Ambas was clearly designed to
frustrate the Union in its desire to forge a new CBA with the College that is reflective
of the true wishes and aspirations of the Union members.
30. STANDARD CHARTERED BANK EMPLOYEES UNION (NUBE) vs. CONFESOR
ISSUE
WON either of Union or the Bank violated its duty to bargain hence, ULP is committed
HELD
NO. The Union alleges that the Bank violated its duty to bargain; hence,
committed ULP under Article 248(g) when it engaged in surface bargaining. It alleged
19|LabRel – Part IV-C
that the Bank just went through the motions of bargaining without any intent of
reaching an agreement, as evident in the Bank’s counter-proposals. It explained that
of the 34 economic provisions it made, the Bank only made 6 economic
counterproposals. Further, as borne by the minutes of the meetings, the Bank, after
indicating the economic provisions it had rejected, accepted, retained or were open
for discussion, refused to make a list of items it agreed to include in the economic
package.
Surface bargaining is defined as "going through the motions of negotiating" without
any legal intent to reach an agreement. The resolution of surface bargaining
allegations never presents an easy issue. The determination of whether a party has
engaged in unlawful surface bargaining is usually a difficult one because it involves, at
bottom, a question of the intent of the party in question, and usually such intent can
only be inferred from the totality of the challenged party’s conduct both at and away
from the bargaining table. It involves the question of whether an employer’s conduct
demonstrates an unwillingness to bargain in good faith or is merely hard bargaining.
The minutes of meetings from March 12, 1993 to June 15, 1993 do not show that the
Bank had any intention of violating its duty to bargain with the Union. Records show
that after the Union sent its proposal to the Bank on February 17, 1993, the latter
replied with a list of its counter-proposals on February 24, 1993. Thereafter, meetings
were set for the settlement of their differences. The minutes of the meetings show
that both the Bank and the Union exchanged economic and non-economic proposals
and counter-proposals.
The Union has not been able to show that the Bank had done acts, both at and away
from the bargaining table, which tend to show that it did not want to reach an
agreement with the Union or to settle the differences between it and the Union.
Admittedly, the parties were not able to agree and reached a deadlock. However, it is
herein emphasized that the duty to bargain "does not compel either party to agree to
a proposal or require the making of a concession."53 Hence, the parties’ failure to
agree did not amount to ULP under Article 248(g) for violation of the duty to bargain.
We can hardly dispute this finding, for it finds support in the evidence. The inference
that respondents did not refuse to bargain collectively with the complaining union
because they accepted some of the demands while they refused the others even
leaving open other demands for future discussion is correct, especially so when those
demands were discussed at a meeting called by respondents themselves precisely in
view of the letter sent by the union on April 29, 1960.
The court , likewise, do not agree that the Union is guilty of ULP for engaging in blue-
sky bargaining or making exaggerated or unreasonable proposals. The Bank failed to
show that the economic demands made by the Union were exaggerated or
Scroll No. 577
unreasonable. The minutes of the meeting show that the Union based its economic
proposals on data of rank and file employees and the prevailing economic benefits
received by bank employees from other foreign banks doing business in the
Philippines and other branches of the Bank in the Asian region.
31. ASSOCIATED TRADE UNIONS (ATU) vs. TRAJANO
ISSUE
WON the petition for certification of election is defective because a new collective
bargaining agreement had been entered into by ATU and the Company? NO
HELD
Insofar as the first issue is concerned has become at best only academic now. The
reason is that the 30% consent required under then Section 258 of the Labor Code is
no longer in force owing to the amendment of this section by Executive Order No.
111, which became effective on March 4, 1987.
The applicable provision in the case at bar is Article 256 because Baliwag transit, Inc.
is an organized establishment. Under this provision, the petition for certification
election need no longer carry the signatures of the 30% of the workers consenting to
such petition as originally required under Article 258. The present rule provides that
as long as the petition contains the matters 7 required in Section 2, Rule 5, Book V of
the Implementing Rules and Regulations, as amended by Section 6, Implementing
Rules of E.O. No. 111, the med-arbiter "shall automatically order" an election by
secret ballot "to ascertain the will of the employees in the appropriate bargaining
unit." The consent requirement is now applied only to unorganized establishments
under Article 257, and at that, significantly, has been reduced to only 20%.
The petition must also fail on the second issue which is based on the contract-bar rule
under Section 3, Rule 5, Book V of the Implementing Rules and Regulations. This rule
simply provides that a petition for certification election or a motion for intervention
can only be entertained within sixty days prior to the expiry date of an existing
collective bargaining agreement. Otherwise put, the rule prohibits the filing of a
petition for certification election during the existence of a collective bargaining
agreement except within the freedom period, as it is called, when the said agreement
is about to expire. The purpose, obviously, is to ensure stability in the relationships of
the workers and the management by preventing frequent modifications of any
20|LabRel – Part IV-C
collective bargaining agreement earlier entered into by them in good faith and for the
stipulated original period.
ATU insists that its collective bargaining agreement concluded by it with Baliwag
Transit, Inc, on April 1, 1986, should bar the certification election sought by TUPAS as
this would disturb the said new agreement. Moreover, the agreement had been
ratified on April 3, 1986, by a majority of the workers and is plainly beneficial to them
because of the many generous concessions made by the management.
TUPAS contends that the said agreement suffers from certain fatal procedural flaws.
Specifically, the CBA was not posted for at least five days in two conspicuous places in
the establishment before ratification, to enable the workers to clearly inform
themselves of its provisions. Moreover, the CBA submitted to the MOLE did not carry
the sworn statement of the union secretary, attested by the union president, that the
CBA had been duly posted and ratified, as required by Section 1, Rule 9, Book V of the
Implementing Rules and Regulations. These requirements being mandatory, non-
compliance therewith rendered the said CBA ineffective.
The Court will not rule on the merits and/or defects of the new CBA and shall only
consider the fact that it was entered into at a time when the petition for certification
election had already been filed by TUPAS and was then pending resolution. The said
CBA cannot be deemed permanent, precluding the commencement of negotiations
by another union with the management. In the meantime however, so as not to
deprive the workers of the benefits of the said agreement, it shall be recognized and
given effect on a temporary basis, subject to the results of the certification election.
The agreement may be continued in force if ATU is certified as the exclusive
bargaining representative of the workers or may be rejected and replaced in the
event that TUPAS emerges as the winner.
This ruling is consistent with our earlier decisions on interim arrangements of this
kind where we declared:
... we are not unmindful that the supplemental collective bargaining contract,
entered into in the meanwhile between management and respondent Union
contains provisions beneficial to labor. So as not to prejudice the workers
involved, it must be made clear that until the conclusion of a new collective
bargaining contract entered into by it and whatever labor organization may be
chosen after the certification election, the existing labor contract as thus
Scroll No. 577
supplemented should be left undisturbed. Its terms call for strict compliance.
This mode of assuring that the cause of labor suffers no injury from the struggle
between contending labor organization follows the doctrine announced in the
recent case of Vassar Industries Employees v. Estrella (L-46562, March 31, 1978).
To quote from the opinion. "In the meanwhile, if as contended by private
respondent labor union the interim collective bargaining agreement which it
engineered and entered into on September 26, 1977 has, much more favorable
terms for the workers of private respondent Vassar Industries, then it should
continue in full force and effect until the appropriate bargaining representative is
chosen and negotiations for a new collective bargaining agreement thereafter
concluded."
32. ASSOCIATED LABOR UNIONS (ALU) vs. CALLEJA
ISSUE
WON the CBA is defective for non-posting in at least 2 most conspicuous places in the
establishment
HELD
YES. An infirmity of the collective bargaining agreement involved was the failure to
post the same in at least two (2) conspicuous places in the establishment at least five
days before its ratification. 8 Petitioners rationalization was that "because of the real
existence of the illegal strike staged by SPFL in all the stores of GAW Trading, Inc. it
had become impossible to comply with the posting requirement in so far as the
realization of tits purpose is concerned as there were no impartial members of the
unit who could be appraised of the CBA's contents. " 9 This justification is puerile and
unacceptable.
In the first place, the posting of copies of the collective bargaining agreement is the
responsibility of the employer which can easily comply with the requirement through
a mere mechanical act. The fact that there were "no impartial members of the unit" is
immaterial. The purpose of the requirement is precisely to inform the employees in
the bargaining unit of the contents of said agreement so that they could intelligently
decide whether to accept the same or not. The assembly of the members of ALU
wherein the agreement in question was allegedly explained does not cure the defect.
21|LabRel – Part IV-C
The contract is intended for all employees and not only for the members of the
purported representative alone. It may even be said the need to inform the non-
members of the terms thereof is more exigent and compelling since, in all likehood,
their contact with the persons who are supposed to represent them is limited.
Moreover, to repeat, there was an apparent and suspicious hurry in the
formulation and finalization of said collective bargaining accord.
Another potent reason for annulling the disputed collective bargaining is the finding
of respondent director that one hundred eighty-one( 181) of the two hundred eighty-
one (281) workers who "ratified" the same, “now strongly and vehemently deny
and/or repudiate the alleged negotiations and ratification of the CBA.” Although
petitioner claims that only seven (7) of the repudiating group of workers belong to
the total number who allegedly ratified the agreement, nevertheless such
substantiated contention weighed against the factual that the controverted contract
will not promote industrial stability.
33. PLANTERS PRODUCTS, INC., vs. NLRC
ISSUE
WON PPI was guilty of unfair labor practice when the RPP is unilaterally amended
HELD
No. Article 248 of the Labor Code provides inter alia that:
... Unfair labor practices of employers, It shall be unlawful for an employer to commit
any of the following unfair labor practice.
xxxxxxxxx
(i) To violate a collective bargaining agreement.
The questioned provision in the 1984-87 Collective Bargaining Agreement limited the
application of the termination allowance only to those separated from the service
due to disability. The prior CBAs from 1975 upwards granted a termination allowance,
upon the employee's separation, of at least three (3) weeks to one (1) month's pay
for each year of service depending upon the total years of service.
There was allegedly bad faith in limiting the application of the termination allowance
as the company already had plans to retrench the workers.
Bad faith in the negotiations was not present considering that the provision on
termination allowance was made to apply to everybody including those subsequently
retrenched or retired after the complainants' and complainants- intervenors'
Scroll No. 577
retrenchment. There was no singling out of the complainants and intervenors-
complainants.
Under Article 231 of the Labor Code and Sec. 1, Rule IX, Book V of the Implementing
Rules, the parties to a collective agreement are required to furnish copies to the
appropriate Regional Office with accompanying proof of ratification by the majority
of all the workers in the bargaining unit. This was not done in the case at bar. But we
do not declare the 1984-1987 CBA invalid or void considering that the employees
have enjoyed benefits from it. They cannot receive benefits under provisions
favorable to them and later insist that the CBA is void simply because other
provisions turn out not to the liking of certain employees. Moreover, the two CBAs
prior to the 1984-1987 CBA were not also formally ratified, yet the employees are
basing their present claims on these CBAs. It is inequitous to receive benefits from a
CBA and later on disclaim its validity.
There is nothing in the records showed that PPI was guilty of unfair labor practice.
34. GENERAL MILLING CORPORATION vs. COURT OF APPEALS,
ISSUE
WON GMC is guilty of ULP for violating the duty to bargain collectively and/or
interfering with the right of its employees to self-organization, and imposing upon
GMC the draft CBA proposed by the union for two years to begin from the expiration
of the original CBA.
HELD
RE:TERMS OF A CBA
On the first issue, Article 253-A of the Labor Code, as amended by Rep. Act No. 6715,
states:
ART. 253-A. Terms of a collective bargaining agreement. Any Collective Bargaining
Agreement that the parties may enter into shall, insofar as the representation aspect
is concerned, be for a term of five (5) years. No petition questioning the majority
status of the incumbent bargaining agent shall be entertained and no certification
election shall be conducted by the Department of Labor and Employment outside of
the sixty-day period immediately before the date of expiry of such five year term of
the Collective Bargaining Agreement. All other provisions of the Collective Bargaining
Agreement shall be renegotiated not later than three (3) years after its execution....
22|LabRel – Part IV-C
 The law mandates that the representation provision of a CBA should last for five
years. The relation between labor and management should be undisturbed until the
last 60 days of the fifth year. Hence, it is indisputable that when the union requested
for a renegotiation of the economic terms of the CBA on November 29, 1991, it was
still the certified collective bargaining agent of the workers, because it was seeking
said renegotiation within five (5) years from the date of effectivity of the CBA on
December 1, 1988. The unions proposal was also submitted within the prescribed 3-
year period from the date of effectivity of the CBA, albeit just before the last day of
said period. It was obvious that GMC had no valid reason to refuse to negotiate in
good faith with the union. For refusing to send a counter-proposal to the union and
to bargain anew on the economic terms of the CBA, the company committed an
unfair labor practice under Article 248 of the Labor Code, which provides that:
ART. 248. Unfair labor practices of employers. It shall be unlawful for an employer to
commit any of the following unfair labor practice:
...
(g) To violate the duty to bargain collectively as prescribed by this Code;
Article 252 of the Labor Code elucidates the meaning of the phrase duty to bargain
collectively, thus:
ART. 252. Meaning of duty to bargain collectively. The duty to bargain collectively
means the performance of a mutual obligation to meet and convene promptly and
expeditiously in good faith for the purpose of negotiating an agreement....
We have held that the crucial question whether or not a party has met his
statutory duty to bargain in good faith typically turns on the facts of the individual
case. There is no per se test of good faith in bargaining. Good faith or bad faith is an
inference to be drawn from the facts. The effect of an employers or a unions actions
individually is not the test of good-faith bargaining, but the impact of all such
occasions or actions, considered as a whole.[11]
Both parties are required to perform their mutual obligation to meet and convene
promptly and expeditiously in good faith for the purpose of negotiating an
agreement. The union lived up to this obligation when it presented proposals for a
new CBA to GMC within three (3) years from the effectivity of the original CBA. But
GMC failed in its duty under Article 252. What it did was to devise a flimsy excuse, by
questioning the existence of the union and the status of its membership to prevent
any negotiation.
Scroll No. 577
RE: PROCEDURE IN COLLECTIVE BARGAINING
It bears stressing that the procedure in collective bargaining prescribed by the Code is
mandatory because of the basic interest of the state in ensuring lasting industrial
peace. Thus:
ART. 250. Procedure in collective bargaining. The following procedures shall be
observed in collective bargaining:
(a) When a party desires to negotiate an agreement, it shall serve a written notice
upon the other party with a statement of its proposals. The other party shall make a
reply thereto not later than ten (10) calendar days from receipt of such notice.
GMCs failure to make a timely reply to the proposals presented by the union is
indicative of its utter lack of interest in bargaining with the union. Its excuse that it
felt the union no longer represented the workers, was mainly dilatory as it turned out
to be utterly baseless.
We hold that GMCs refusal to make a counter-proposal to the unions’ proposal
for CBA negotiation is an indication of its bad faith. Where the employer did not even
bother to submit an answer to the bargaining proposals of the union, there is a clear
evasion of the duty to bargain collectively.
Failing to comply with the mandatory obligation to submit a reply to the unions
proposals, GMC violated its duty to bargain collectively, making it liable for unfair
labor practice. Perforce, the Court of Appeals did not commit grave abuse of
discretion amounting to lack or excess of jurisdiction in finding that GMC is, under the
circumstances, guilty of unfair labor practice.
DID GMC INTERFERE WITH THE EMPLOYEES’ RIGHT TO SELF-ORGANIZATION?
The letters between February to June 1993 by 13 union members signifying their
resignation from the union clearly indicated that GMC exerted pressure on its
employees. The records show that GMC presented these letters to prove that the
union no longer enjoyed the support of the workers. The fact that the resignations of
the union members occurred during the pendency of the case before the labor
arbiter shows GMCs desperate attempts to cast doubt on the legitimate status of the
union. We agree with the CAs conclusion that the ill-timed letters of resignation from
the union members indicate that GMC had interfered with the right of its employees
to self-organization. Thus, we hold that the appellate court did not commit grave
23|LabRel – Part IV-C
abuse of discretion in finding GMC guilty of unfair labor practice for interfering with
the right of its employees to self-organization.
Finally, did the CA gravely abuse its discretion when it imposed on GMC the
draft CBA proposed by the union for two years commencing from the expiration of
the original CBA?
The Code provides:
The findings of fact by the CA, affirming those of the NLRC as to the reasonableness
of the draft CBA proposed by the union should not be disturbed since they are
supported by substantial evidence.
35. ABARIA v. NLRC December 2011

ART. 253. Duty to bargain collectively when there exists a collective bargaining ISSUE
agreement. ....It shall be the duty of both parties to keep the status quo and to
continue in full force and effect the terms and conditions of the existing WON MCCHI is guilty of unfair labor practice. NO!!!
agreement during the 60-day period [prior to its expiration date] and/or until a new
agreement is reached by the parties. (Underscoring supplied.) HELD

The provision mandates the parties to keep the status quo while they are still in
Art. 248 (g) of the Labor Code, as amended, makes it an unfair labor practice for an
the process of working out their respective proposal and counter proposal. The
employer "[t]o violate the duty to bargain collectively" as prescribed by the Code. The
general rule is that when a CBA already exists, its provision shall continue to govern
applicable provision in this case is Art. 253 which provides:
the relationship between the parties, until a new one is agreed upon. The rule
necessarily presupposes that all other things are equal. That is, that neither party is
ART. 253. Duty to bargain collectively when there exists a collective bargaining
guilty of bad faith. However, when one of the parties abuses this grace period by
agreement. – When there is a collective bargaining agreement, the duty to bargain
purposely delaying the bargaining process, a departure from the general rule is
collectively shall also mean that neither party shall terminate nor modify such
warranted.
agreement during its lifetime. However, either party can serve a written notice to
terminate or modify the agreement at least sixty (60) days prior to its expiration date.
It would be unfair to the union and its members if the terms and conditions
It shall be the duty of both parties to keep the status quo and to continue in full force
contained in the old CBA would continue to be imposed on GMCs employees for the
and effect the terms and conditions of the existing agreement during the 60-day
remaining two (2) years of the CBAs duration. We are not inclined to gratify GMC
period and/or until a new agreement is reached by the parties.
with an extended term of the old CBA after it resorted to delaying tactics to prevent
negotiations.
NAMA-MCCH-NFL charged MCCHI with refusal to bargain collectively when the latter
refused to meet and convene for purposes of collective bargaining, or at least give a
Since it was GMC which violated the duty to bargain collectively, based on Kiok
counter-proposal to the proposed CBA the union had submitted and which was
Loy and Divine Word University of Tacloban, it had lost its statutory right to negotiate
ratified by a majority of the union membership. MCCHI, on its part, deferred any
or renegotiate the terms and conditions of the draft CBA proposed by the union.
negotiations until the local union’s dispute with the national union federation (NFL) is
resolved considering that the latter is the exclusive bargaining agent which
We carefully note, however, that as strictly distinguished from the facts of this
represented the rank-and-file hospital employees in CBA negotiations since 1987.
case, there was no pre-existing CBA between the parties in Kiok Loy and Divine Word
University of Tacloban. Nonetheless, we deem it proper to apply in this case the
We rule for MCCHI.
rationale of the doctrine in the said two cases. To rule otherwise would be to allow
GMC to have its cake and eat it too.
Records of the NCMB and DOLE Region 7 confirmed that NAMA-MCCH-NFL had not
registered as a labor organization, having submitted only its charter certificate as an

Scroll No. 577 24|LabRel – Part IV-C

affiliate or local chapter of NFL.37 Not being a legitimate labor organization, NAMA-
MCCH-NFL is not entitled to those rights granted to a legitimate labor organization
under Art. 242, specifically:
(a) To act as the representative of its members for the purpose of collective
bargaining;
By-Laws, and if found guilty to expel such members.42 MCCHI therefore cannot be
faulted for deferring action on the CBA proposal submitted by NAMA-MCCH-NFL in
view of the union leadership’s conflict with the national federation. We have held
that the issue of disaffiliation is an intra-union dispute43 which must be resolved in a
different forum in an action at the instance of either or both the federation and the
local union or a rival labor organization, not the employer. 44

(b) To be certified as the exclusive representative of all the employees in an Not being a legitimate labor organization nor the certified exclusive bargaining
appropriate collective bargaining unit for purposes of collective bargaining; representative of MCCHI’s rank-and-file employees, NAMA-MCCH-NFL cannot
demand from MCCHI the right to bargain collectively in their behalf.45 Hence,
Aside from the registration requirement, it is only the labor organization designated MCCHI’s refusal to bargain then with NAMA-MCCH-NFL cannot be considered an
or selected by the majority of the employees in an appropriate collective bargaining unfair labor practice to justify the staging of the strike.
unit which is the exclusive representative of the employees in such unit for the
purpose of collective bargaining, as provided in Art. 255.38 NAMA-MCCH-NFL is not
the labor organization certified or designated by the majority of the rank-and-file
hospital employees to represent them in the CBA negotiations but the NFL, as 36. SAN MIGUEL FOODS, INCORPORATED v. SAN MIGUEL CORPORATION
evidenced by CBAs concluded in 1987, 1991 and 1994. While it is true that a local SUPERVISORS and EXEMPT UNION
union has the right to disaffiliate from the national federation, NAMA-MCCH-NFL has
ISSUE
not done so as there was no any effort on its part to comply with the legal requisites
Did the Ca departed from jurisprudence when it expanded the scope of the
for a valid disaffiliation during the "freedom period"39 or the last 60 days of the last
bargaining unit defined by the Court’s ruling in G.R. no. 110399
year of the CBA, through a majority vote in a secret balloting in accordance with Art.
241 (d).40 Nava and her group simply demanded that MCCHI directly negotiate with
HELD
the local union which has not even registered as one.
NO. In G.R. No. 110399, the Court explained that the employees of San Miguel
Corporation Magnolia Poultry Products Plants of Cabuyao, San Fernando, and Otis
To prove majority support of the employees, NAMA-MCCH-NFL presented the CBA
constitute a single bargaining unit, which is not contrary to the one-company, one-
proposal allegedly signed by 153 union members. However, the petition signed by
union policy. An appropriate bargaining unit is defined as a group of employees of a
said members showed that the signatories endorsed the proposed terms and
given employer, comprised of all or less than all of the entire body of employees,
conditions without stating that they were likewise voting for or designating the
which the collective interest of all the employees, consistent with equity to the
NAMA-MCCH-NFL as their exclusive bargaining representative. In any case, NAMA-
employer, indicate to be best suited to serve the reciprocal rights and duties of the
MCCH-NFL at the time of submission of said proposals was not a duly registered labor
parties under the collective bargaining provisions of the law.
organization, hence it cannot legally represent MCCHI’s rank-and-file employees for
The employees in Cabuyao, San Fernando, and Otis25 of Magnolia Poultry Products
purposes of collective bargaining. Hence, even assuming that NAMA-MCCH-NFL had
Plant involved in "dressed" chicken processing and Magnolia Poultry Farms engaged
validly disaffiliated from its mother union, NFL, it still did not possess the legal
in "live" chicken operations. Certain factors, such as specific line of work, working
personality to enter into CBA negotiations. A local union which is not independently
conditions, location of work, mode of compensation, and other relevant conditions
registered cannot, upon disaffiliation from the federation, exercise the rights and
do not affect or impede their commonality of interest. Although they seem separate
privileges granted by law to legitimate labor organizations; thus, it cannot file a
and distinct from each other, the specific tasks of each division are actually
petition for certification election.41 Besides, the NFL as the mother union has the right
interrelated and there exists mutuality of interests which warrants the formation of a
to investigate members of its local chapter under the federation’s Constitution and
single bargaining unit.
Scroll No. 577 25|LabRel – Part IV-C
 37. MANILA MINING CORP. EMPLOYEES ASSOCIATION-FEDERATION OF FREE 38. GENERAL MILLING CORPORATION, vs. CASIO,
WORKERS CHAPTER VS. MANILA MINING CORP. (MMC)
ISSUES
ISSUE
WON MMC is guilty of ULP.
1. WON a closed shop provision in a CBA is valid.

HELD
2. WON the the termination of Casio, et al. pursuant to the closed shop provision of
NO. The lay-off is neither illegal nor can it be considered as ULP.
the CBA was valid.
Despite all efforts exerted by MMC, it did not succeed in obtaining the consent of the
residents of the community where the tailing pond would operate, one of the
HELD
conditions imposed by DENR in granting its application for permanent permit.
Suspension of MMC’s mining operations was not due to its fault but was brought
1. YES. a stipulation in the CBA authorizing the dismissal of employees are of equal
about by the non-issuance of a permit for the continued operation.
import as the statutory provisions on dismissal under the Labor Code, since "a CBA is
Unfair labor practice cannot be imputed to MMC since as ruled by the CA, the call of
the law between the company and the union and compliance therewith is mandated
MMC for suspension of the CBA negotiation cannot be equated to “refusal to
by the express policy to give protection to labor."
bargain”.
(See Article 252 Meaning of duty to bargain collectively)
2. NO. The dismissal was invalid.
For a charge of unfair labor practice to prosper, it must be shown that the employer
was motivated by ill-will, bad faith or fraud, or was oppressive to labor. The employer
In terminating the employment of an employee by enforcing the union security
must have acted in a manner contrary to morals, good customs, or public policy
clause, the employer needs only to determine and prove that: (1) the union security
causing social humiliation, wounded feelings or grave anxiety. While the law makes it
clause is applicable; (2) the union is requesting for the enforcement of the union
an obligation for the employer and the employees to bargain collectively with each
security provision in the CBA; and (3) there is sufficient evidence to support the
other, such compulsion does not include the commitment to precipitately accept or
decision of the union to expel the employee from the union. These requisites
agree to the proposal of the other. All it contemplates is that both parties should
constitute just cause for terminating an employee based on the union security
approach the negotiation with an open mind and make reasonable effort to reach a
provision of the CBA.
common ground of agreement.
It cannot be said the MMC deliberately avoided the negotiation. It merely sought the
It is the third requisite – that there is sufficient evidence to support the decision of
suspension and in fact, even expressed its willingness to negotiate once the mining
IBM-Local 31 to expel Casio, et al. – which appears to be lacking in this case. It is
operations resume. There was valid reliance on the suspension of mining operations
apparent that GMC terminated the employment of Casio, et al. relying upon the
for the suspension, in turn, of the CBA negotiation. The Union failed to prove bad
Resolution of Pino, et al. expelling Casio, et al. from IBM-Local 31; on Gabiana’s
faith in MMC’s actuations.
Letters demanding that GMC terminate the employment of Casio, et al. on the basis
As to the issue of lay-off, it was also valid but such does not excuse the MMC from
of the closed shop clause in the CBA; and the threat of being sued by IBM-Local 31 for
paying the laid-off workers with separation pay.
unfair labor practice. The letter made no mention at all of the evidence supporting
the decision of IBM-Local 31 to expel Casio, et al. from the union. GMC never alleged
nor attempted to prove that the company actually looked into the evidence of IBM-
Local 31 for expelling Casio, et al. and made a determination on the sufficiency
thereof. Without such a determination, GMC cannot claim that it had terminated the
employment of Casio, et al. for just cause.

Scroll No. 577 26|LabRel – Part IV-C

The failure of GMC to make a determination of the sufficiency of evidence supporting
the decision of IBM-Local 31 to expel Casio, et al. is a direct consequence of the non-
observance by GMC of procedural due process in the dismissal of employees.
As a defense, GMC contends that as an employer, its only duty was to ascertain that
IBM-Local 31 accorded Casio, et al. due process; and, it is the finding of the company
that IBM-Local 31 did give Casio, et al. the opportunity to answer the charges against
them, but they refused to avail themselves of such opportunity.
This argument is without basis. The Court has stressed time and again that allegations
must be proven by sufficient evidence because mere allegation is definitely not
evidence. In illegal dismissal cases like the present one, the onus of proving that the
employee was not dismissed or if dismissed, that the dismissal was not illegal, rests
on the employer and failure to discharge the same would mean that the dismissal is
not justified and therefore illegal. Thus, petitioners must not only rely on the
weakness of respondents’ evidence but must stand on the merits of their own
defense. A party alleging a critical fact must support his allegation with substantial
evidence for any decision based on unsubstantiated allegation cannot stand as it will
offend due process.
In sum, the Court finds that GMC illegally dismissed Casio, et al. because not only did
GMC fail to make a determination of the sufficiency of evidence to support the
decision of IBM-Local 31 to expel Casio, et al., but also to accord the expelled union
members procedural due process, i.e., notice and hearing, prior to the termination of
their employment.
39. LIBERTY FLOUR MILLS EMPLOYEES, vs. LIBERTY FLOUR MILLS, INC.
ISSUE
WON such allowances are indeed absorbed by the wage increases required under the
agreement.
HELD
YES. This is because Section 6 of the Interpretative Bulletin on LOI No. 174
specifically provides:
Sec. 6.Allowances under LOI. — -All allowances, bonuses, wage adjustments and
other benefits given by employers to their employees shall be treated by the
Scroll No. 577
Department of Labor as in substantial compliance with the minimum standards set
forth in LOI No. 174 if:
(a) they conform with at least the minimum allowances scales specified in the
immediately preceding Section; and
(b) they are given in response to the appeal of the President in his speech on 4
January 1974, or to countervail the quantum jump in the cost of living as a result of
the energy crisis starting in November 1973, or pursuant to Presidential Decree No.
390; Provided, That the payment is retroactive to 18 February 1974 or earlier.
The allowances and other benefits may be granted unilaterally by the employer or
through collective bargaining, and may be paid at the same time as the regular wages
of the employees.
Allowances and other benefits which are not given in substantial compliance with the
LOI as interpreted herein shall not be treated by the Department of Labor as
emergency allowances in the contemplation of the LOI unless otherwise shown by
sufficient proof. Thus, without such proof, escalation clauses in collective bargaining
agreements concluded before the appeal of the President providing for automatic or
periodic wage increases shall not be considered allowances for purposes of the LOI.
The "immediately preceding section" referred to above states:
SEC. 5.Determination of Amount of Allowances. — In determining the amount of
allowances that should be given by employers to meet the recommended minimum
standards, the LOI has classified employers into three general categories. As an
implementation policy, the Department of Labor shall consider as sufficient
compliance with the scales of allowances recommended by the LOI if the following
monthly allowances are given by employers:
(a) P50.00 or higher where the authorized capital stock of the corporation, or the
total assets in the case of other undertakings, exceeds P 1 million;
(b) P 30.00 or higher where the authorized capital stock of the corporation, or the
total assets in the case of other undertakings, is not less than P100,000.00 but not
more than P1million; and
(c) P15.00 or higher where the authorized capital stock or total assets, as the case
may be, is less than P100,000.00.
It is not denied that the company falls under paragraph (a), as it has a capitalization of
more than P l million, 10and so must pay a minimum allowance of P50.00 a month.
This amount is clearly covered by the increases prescribed in the CBA, which required
a monthly increase (on the basis of 30 days) of P60.00 for 1974, to be increased by
P30.00 in 1975 (to P90.00) and another P 30.00 in 1976 (to P120.00). The first
increase in 1974 was already above the minimum allowance of P50.00, which was
exceeded even more with the increases of Pl.00 for each of the next two years.
27|LabRel – Part IV-C
In fact, the company agreed to grant the emergency allowance even before the hotel to dismiss Beloncio as requested, the union filed a notice of strike with the
obligation was imposed by the government. What the petitioners claim they are Ministry of Labor and Employment on August 17, 1984 on the issue of unfair labor
being made to waive is the additional P50.00 allowance but the truth is that they are practice. The hotel was then compelled to put Beloncio on forced leave and to stop
not entitled to this because they are already enjoying the stipulated increases. There payment of her salary from September 1, 1984.
is no waiver of these increases. Furthermore, as provided for in the collective bargaining agreement between the
Moreover, Section 2 provides that the wage increase shall be considered payment of petitioner-the Union and the Manila Mandarin Hotel "the Union shall hold the
any statutory increase of the minimum wage "as far as it will go," which means that Company free and blameless from any and all liabilities that may arise" should the
any amount not covered by such wage increase will have to be made good by the employee question the dismissal, as has happened in the case at bar.
company. In short, the difference between the stipulated wage increase and the The collective bargaining agreement in this case contains a union security clause — a
statutory minimum wage will have to be paid by the company notwithstanding and, closed-shop agreement.
indeed, pursuant to the said article. A closed-shop agreement is an 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. It is "the most prized achievement of unionism." It
40. MANILA MANDARIN EMPLOYEES UNION vs. NLRC adds membership and compulsory dues. By holding out to loyal members a promise
of employment in the closed-shop, it welds group solidarity. (National Labor Union vs.
Aguinaldo's Echague, Inc., 97 Phil. 184). It is a very effective form of union security
ISSUE
agreement.
WON the petitioners committed ULP Hence Beloncio was not properly dismissed
This Court has held that a closed-shop is a valid form of union security, and such a
HELD
provision in a collective bargaining agreement is not a restriction of the right of
YES.
freedom of association guaranteed by the Constitution. (Lirag Textile Mills, Inc. vs.
Article 250 of the Labor Code provides the following:
Blanco, 109 SCRA 87; Manalang vs. Artex Development Company, Inc., 21 SCRA 561).
Art. 250. Unfair labor practices of labor organizations. — It shall be unfair labor
The Court stresses, however, that union security clauses are also governed by law and
practice for a labor organization, its officers, agents or representatives:
by principles of justice, fair play, and legality. Union security clauses cannot be used
xxxxxxxxx
by union officials against an employer, much less their own members, except with a
(b) To cause or attempt to cause an employer to discriminate against an employee,
high sense of responsibility, fairness, prudence, and judiciousness.
including discrimination against an employee with respect to whom membership in
A union member may not be expelled from her union, and consequently from her
such organization has been denied or to terminate an employee on any ground other
job, for personal or impetuous reasons or for causes foreign to the closed-shop
than the usual terms and conditions under which membership or continuation of
agreement and in a manner characterized by arbitrariness and whimsicality.
membership is made available to other members. (Emphasis supplied)
Article 217 of the Labor Code also provides:
Art. 217. Jurisdiction of Labor Arbiters and the Commission — (a) The Labor Arbiters
41. BANK OF THE PHILIPPINE ISLANDS, Petitioner vs. BPI EMPLOYEES UNION
shall have the original and exclusive jurisdiction to hear and decide ... the following
cases involving all workers, whether agricultural or nonagricultural;
(1) Unfair labor practice cases;
ISSUE
xxxxxxxxx
(b) The Commission shall have exclusive appellate jurisdiction over all cases decided
WON the former FEBTC employees should be considered new employees of BPI for
by Labor Arbiters. (Rollo, pp. 155-157.)
purposes of applying the Union Shop Clause of the CBA
The Hotel would not have compelled Beloncio to go on forced leave were it not for
the union's insistence and demand to the extent that because of the failure of the
Scroll No. 577 28|LabRel – Part IV-C
HELD
YES.
The absorbed FEBTC employees are covered by the Union Shop Clause. It is
indubitable from the Union Shop Clause is that upon the effectivity of the CBA,
petitioner's new regular employees (regardless of the manner by which they became
employees of BPI) are required to join the Union as a condition of their continued
employment.
No Substantial Distinction Under the CBA Between Regular Employees Hired After
Probationary Status and Regular Employees Hired After the Merger
Verily, we agree with the Court of Appeals that there are no substantial differences
between a newly hired non-regular employee who was regularized weeks or months
after his hiring and a new employee who was absorbed from another bank as a
regular employee pursuant to a merger, for purposes of applying the Union Shop
Clause. Both employees were hired/employed only after the CBA was signed. At the
time they are being required to join the Union, they are both already regular rank and
file employees of BPI. They belong to the same bargaining unit being represented by
the Union.
Non-Application of Union Shop Clause Contrary to the Policy of the Labor Code and
Inimical to Industrial Peace
It is but fair that similarly situated employees who enjoy the same privileges of a CBA
should be likewise subject to the same obligations the CBA imposes upon them. A
contrary interpretation of the Union Shop Clause will be inimical to industrial peace
and workers solidarity.
The union shop clause offers protection to the certified bargaining agent by ensuring
that future regular employees who (a) enter the employ of the company during the
life of the CBA; (b) are deemed part of the collective bargaining unit; and (c) whose
number will affect the number of members of the collective bargaining unit will be
compelled to join the union. Such compulsion has legal effect, precisely because the
employer by voluntarily entering in to a union shop clause in a CBA with the certified
bargaining agent takes on the responsibility of dismissing the new regular employee
who does not join the union.
Scroll No. 577
Without the union shop clause or with the restrictive interpretation, the company can
jeopardize the majority status of the certified union by excluding from union
membership all new regular employees whom the Company will absorb in future
mergers and all new regular employees whom the Company hires as regular from the
beginning of their employment without undergoing a probationary period. In this
manner, the Company can increase the number of members of the collective
bargaining unit and if this increase is not accompanied by a corresponding increase in
union membership, the certified union may lose its majority status and render it
vulnerable to attack by another union who wishes to represent the same bargaining
unit.
42. ESTATE OF NELSON R. DULAY, vs. ABOITIZ JEBSEN MARITIME
ISSUE
WON the Labor Arbiter has jurisdiction over the case
HELD
NO. Petitioner contends that Section 10 of Republic Act (R.A.) 8042, otherwise
known as the Migrant Workers and Overseas Filipinos Act of 1995, vests jurisdiction
on the appropriate branches of the NLRC to entertain disputes regarding the
interpretation of a collective bargaining agreement involving migrant or overseas
Filipino workers. Petitioner argues that the abovementioned Section amended Article
217 (c) of the Labor Code which, in turn, confers jurisdiction upon voluntary
arbitrators over interpretation or implementation of collective bargaining
agreements and interpretation or enforcement of company personnel policies.
SEC. 10. Money Claims. - Notwithstanding any provision of law to the contrary, the
Labor Arbiters of the National Labor Relations Commission (NLRC) shall have the
original and exclusive jurisdiction to hear and decide, within ninety (90) calendar days
after filing of the complaint, the claims arising out of an employer-employee
relationship or by virtue of any law or contract involving Filipino workers for overseas
deployment including claims for actual, moral, exemplary and other forms of
damages.
Article 217(c) of the Labor Code, on the other hand, states that:
29|LabRel – Part IV-C
 x xxx
(c) Cases arising from the interpretation or implementation of collective
bargaining agreements and those arising from the interpretation or
enforcement of company personnel policies shall be disposed by the Labor
Arbiter by referring the same to the grievance machinery and voluntary
arbitration as may be provided in said agreements.
On their part, respondents insist that in the present case, Article 217, paragraph (c) as
well as Article 261 of the Labor Code remain to be the governing provisions of law
with respect to unresolved grievances arising from the interpretation and
implementation of collective bargaining agreements. Under these provisions of law,
jurisdiction remains with voluntary arbitrators.
Article 261 of the Labor Code reads, thus:
ARTICLE 261. Jurisdiction of Voluntary Arbitrators or panel of Voluntary Arbitrators. –
The Voluntary Arbitrator or panel of Voluntary Arbitrators shall have original and
exclusive jurisdiction to hear and decide all unresolved grievances arising from the
interpretation or implementation of the Collective Bargaining Agreement and those
arising from the interpretation or enforcement of company personnel policies
referred to in the immediately preceding article. Accordingly, violations of a Collective
Bargaining Agreement, except those which are gross in character, shall no longer be
treated as unfair labor practice and shall be resolved as grievances under the
Collective Bargaining Agreement. For purposes of this article, gross violations of
Collective Bargaining Agreement shall mean flagrant and/or malicious refusal to
comply with the economic provisions of such agreement.
It is true that R.A. 8042 is a special law governing overseas Filipino workers. However,
a careful reading of this special law would readily show that there is no specific
provision thereunder which provides for jurisdiction over disputes or unresolved
grievances regarding the interpretation or implementation of a CBA. Section 10 of
R.A. 8042, which is cited by petitioner, simply speaks, in general, of "claims arising out
of an employer-employee relationship or by virtue of any law or contract involving
Filipino workers for overseas deployment including claims for actual, moral,
exemplary and other forms of damages." On the other hand, Articles 217(c) and 261
of the Labor Code are very specific in stating that voluntary arbitrators have
Scroll No. 577
jurisdiction over cases arising from the interpretation or implementation of collective
bargaining agreements.
The Court agrees with the CA in holding that this issue clearly involves the
interpretation or implementation of the said CBA. Thus, the specific or special
provisions of the Labor Code govern.
The Company and the Union agree that in case of dispute or conflict in the
interpretation or application of any of the provisions of this Agreement, or
enforcement of Company policies, the same shall be settled through negotiation,
conciliation or voluntary arbitration. The Company and the Union further agree that
they will use their best endeavor to ensure that any dispute will be discussed,
resolved and settled amicably by the parties hereof within ninety (90) days from the
date of filing of the dispute or conflict and in case of failure to settle thereof any of
the parties retain their freedom to take appropriate action
From the foregoing, it is clear that the parties, in the first place, really intended to
bring to conciliation or voluntary arbitration any dispute or conflict in the
interpretation or application of the provisions of their CBA. It is settled that when the
parties have validly agreed on a procedure for resolving grievances and to submit a
dispute to voluntary arbitration then that procedure should be strictly observed.
In the same manner, Section 29 of the prevailing Standard Terms and Conditions
Governing the Employment of Filipino Seafarers on Board Ocean Going Vessels,
promulgated by the Philippine Overseas Employment Administration (POEA),
provides as follows:
Section 29. Dispute Settlement Procedures. − In cases of claims and disputes arising
from this employment, the parties covered by a collective bargaining agreement
shall submit the claim or dispute to the original and exclusive jurisdiction of the
voluntary arbitrator or panel of arbitrators.
43. KAISAHAN AT KAPATIRAN NG MGA MANGGAGAWA AT KAWANI SA MWC-
EAST ZONE UNION versus MANILA WATER COMPANY, INC.,
ISSUE
WON the NLRC gravely abused its discretion in awarding ten percent (10%) attorneys
fees to the petitioners.
30|LabRel – Part IV-C

HELD
Article 111 of the Labor Code, as amended, governs the grant of attorneys fees in
labor cases:
Art. 111. Attorneys fees.- (a) In cases of unlawful withholding of wages, the culpable
party may be assessed attorneys fees equivalent to ten percent of the amount of
wages recovered.
(b) It shall be unlawful for any person to demand or accept, in any judicial or
administrative proceedings for the recovery of wages, attorneys fees which exceed
ten percent of the amount of wages recovered.
Section 8, Rule VIII, Book III of its Implementing Rules also provides, viz.:
Section 8. Attorneys fees. Attorneys fees in any judicial or administrative proceedings
for the recovery of wages shall not exceed 10% of the amount awarded. The fees may
be deducted from the total amount due the winning party.
We explained in PCL Shipping Philippines, Inc. v. National Labor Relations
Commissionthat there are two commonly accepted concepts of attorneysfeesthe
ordinary and extraordinary. In its ordinary concept, an attorneys fee is the reasonable
compensation paid to a lawyer by his client for the legal services the former renders;
compensation is paid for the cost and/or results of legal services per agreement or as
may be assessed.
In its extraordinary concept, attorneys fees are deemed indemnity for damages
ordered by the court to be paid by the losing party to the winning party. The
instances when these may be awarded are enumerated in Article 2208 of the Civil
Code, specifically in its paragraph 7 on actions for recovery of wages, and is payable
not to the lawyer but to the client, unless the client and his lawyer have agreed that
the award shall accrue to the lawyer as additional or part of compensation.
We also held in PCL Shipping that Article 111 of the Labor Code, as amended,
contemplates the extraordinary concept of attorneys fees and that Article 111 is an
exception to the declared policy of strict construction in the award of attorneys
fees. Although an express finding of facts and law is still necessary to prove the
Scroll No. 577
merit of the award, there need not be any showing that the employer acted
maliciously or in bad faith when it withheld the wages.
In the present case, we find it undisputed that the union members are entitled to
their AA benefits and that these benefits were not paid by the Company. That the
Company had no funds is not a defense as this was not an insuperable cause that was
cited and properly invoked. As a consequence, the union members represented by
the Union were compelled to litigate and incur legal expenses. On these bases, we
find no difficulty in upholding the NLRCs award of ten percent (10%) attorneys fees.
The more significant issue in this case is the effect of the MOA provision that
attorneys fees shall be deducted from the AA and CBA receivables. In this regard, the
CA held that the additional grant of 10% attorneys fees by the NLRC violates Article
111 of the Labor Code, considering that the MOA between the parties already
ensured the payment of 10% attorneys fees deductible from the AA and CBA
receivables of the Unions members. In addition, the Company also argues that
the Unions demand, together with the NLRC award, is unconscionable as it represents
20% of the amount due or about P21.4 million.
In the present case, the ten percent (10%) attorneys fees awarded by the NLRC on
the basis of Article 111 of the Labor Code accrue to the Unions members as
indemnity for damages and not to the Unions counsel as compensation for his legal
services, unless, they agreed that the award shall be given to their counsel as
additional or part of his compensation; in this case the Union bound itself to pay
10% attorneys fees to its counsel under the MOA and also gave up the attorneys fees
awarded to the Unions members in favor of their counsel. This is supported by
Borelas affidavit which stated that [t]he 10% attorneys fees paid by the
members/employees is separate and distinct from the obligation of the company to
pay the 10% awarded attorneys fees which we also gave to our counsel as part of our
contingent fee agreement.[43] The limit to this agreement is that the indemnity for
damages imposed by the NLRC on the losing party (i.e., the Company) cannot
exceed ten percent (10%).
Properly viewed from this perspective, the award cannot be taken to mean
an additional grant of attorneys fees, in violation of the ten percent (10%) limit under
Article 111 of the Labor Code since it rests on an entirely different legal obligation
than the one contracted under the MOA. Simply stated, the attorneys fees
contracted under the MOA do not refer to the amount of attorneys fees awarded
31|LabRel – Part IV-C
by the NLRC; the MOA provision on attorneys fees does not have any bearing at all
to the attorneys fees awarded by the NLRC under Article 111 of the Labor
Code. Based on these considerations, it is clear that the CA erred in ruling that the
LAs award of attorneys fees violated the maximum limit of ten percent (10%) fixed by
Article 111 of the Labor Code.
Under this interpretation, the Companys argument that the attorneys fees
are unconscionable as they represent 20% of the amount due or about P21.4 million
is more apparent than real. Since the attorneys fees awarded by the LA pertained to
the Unions members as indemnity for damages, it was totally within their right to
waive the amount and give it to their counsel as part of their contingent fee
agreement. Beyond the limit fixed by Article 111 of the Labor Code, such as between
the lawyer and the client, the attorneys fees may exceed ten percent (10%) on the
basis of quantum meruit, as in the present case.
Furthermore, at the time of the supposed recognition, the employer was obviously
aware that there were other unions existing in the unit. As earlier stated, respondent
company's letter is dated May 12, 1986 while the two other unions, Southern
Philippine Federation of Labor (hereafter, SPFL and Philippine Social Security Labor
Union (PSSLU, for short), went on strike earlier on May 9, 1986. The unusual
promptitude in the recognition of petitioner union by respondent company as the
exclusive bargaining representative of the workers in GAW Trading, Inc. under the
fluid and amorphous circumstances then obtaining, was decidedly unwarranted and
improvident.
45. GENERAL MARITIME STEVEDORES' UNION OF THE PHILIPPINES
vs. SOUTH SEA SHIPPING LINE, ET AL.
ISSUES

1. WON it is mandatory on the court to order the conduct of CE upon the written
44. ASSOCIATED LABOR UNIONS (ALU) v. CALLEJA, request of 10% members in the ABU
2. WON a new CE shall be conducted
ISSUE
WON the collective bargaining agreement is defective
I. NO

HELD
In a subsequent case, Acoje Mines and Acoje United Workers Union vs. Acoje Labor
YES. The mechanics of collective bargaining are set in motion only when the
Union and Acoje Mining Co. Inc., 105 Phil., 814; 56 Off. Gaz. (6) 1157, on the issue of
following jurisdictional preconditions are present, namely, (1) possession of the
whether or not upon submission of a petition for certification election by at least 10%
status of majority representation by the employees' representative in accordance
of all the workers in a bargaining union, it is mandatory for the CIR to order a
with any of the means of selection and/or designation provided for by the Labor
certification election — with no exceptions, pursuant to Section 12 (c), Republic Act
Code; (2) proof of majority representation; and (3) a demand to bargain under Article
No. 875, through the same Justice, we made the following statement:
251, paragraph (a), of the New Labor Code. 4
In the present case, the standing of petitioner as an exclusive bargaining
The above command of the Court is not so absolute as it may appear at first
representative is dubious, to say the least. It may be recalled that respondent
glance. The statute itself expressly recognizes one exception: When a
company, in a letter dated May 12, 1986 and addressed to petitioner, merely
certification election had occured within one year. And the judicial
indicated that it was "not against the desire of (its) workers" and required petitioner
administrative agencies have found two exceptions: where there is an
to present proof that it was supported by the majority thereof in a meeting to be held
unexpired bargaining agreement not exceeding two years and when there is
on the same date. 5 The only express recognition of petitioner as said employees'
a pending charge of company domination of one of the labor unions
bargaining representative that.In the records is in the collective bargaining
intending to participate in the election.
agreement entered into two days thereafter. 6 Evidently, there was precipitate haste
on the part of respondent company in recognizing petitioner union, which
II. YES
recognition appears to have been based on the self-serving claim of the latter that it
had the support of the majority of the employees in the bargaining unit.
Scroll No. 577 32|LabRel – Part IV-C
On September 15, 1959, while this case was still pending in this Tribunal, petitioner
filed a manifestation to the effect that the contract between the USUP and the
Shipping Line had expired on June 28, 1959, and that the same had not been
renewed. We asked for the comment of the other party. the respondent United
Seamen's Union in its counter manifestation dated July 6, 1960, stated that the
collective bargaining agreement involved, executed on July 28, 1957, was
automatically renewed for a period of two years from July 28, 1959 to July 28 1961,
pursuant to the automatic renewal clause, for the reason that neither party notified
the other in writing not less than sixty days prior to the expiration date, of its desire
to terminate the agreement. So, it would appear that the contract will still be
effective up to July 28, 1961, that is to say, about a year from today.
In view of the foregoing, we believe and hold that the appealed order of the CIR
dismissing the petition for certification election and refusing to allow the selection of
a new bargaining agent, was valid under the circumstances obtaining at the time.
However, inasmuch as there has been a renewal of the bargaining agreement for
another two years and because it seems that the present agreement is but a renewal
of the one entered into way back in 1955, so that until the expiration of the present
agreement, about six years shall have passed, it is advisable that a new certification
election be held.
46. ASSOCIATED TRADE UNIONS (ATU) VS. HON. TRAJANO
ISSUES
1. WON 30% consent requirement is necessary.
2. WON PCE is barred by the CBA entered into between ATU and company
subsequent to the filing of PCE.
HELD
1. NO.
The first issue is now moot and academic since the 30% consent required under
Section 258 of LC is no longer in force owing to the amendment of E.O. No. 111
effective on March 4, 1987. The applicable provision in the case is Article 256 of LC
because the company is an organized establishment. The consent requirement is now
Scroll No. 577
applied only to unorganized establishment under Article 257, and that significantly
has been reduced to only 20%.
2. No.
The contract-bar rule simply provides that a petition for certification election or a
motion for intervention can only be entertained within the freedom period or 60 days
prior to the expiry date of an existing CBA. The rule prohibits the filing of PCE during
the existence of a CBA except within the freedom period. The purpose is to ensure
stability in the relationship of the workers and the management by preventing
frequent modifications of any CBA earlier entered into by them in good faith and for
the stipulated original period.
The CBA entered into by ATU and the company on April 1, 1986 had been ratified on
April 3, 1986 by a majority of the workers and is plainly beneficial to them because of
the many generous concessions made by the management. TUPAs alleged defects on
the CBA such as it was not posted for at least 5 days in 2 conspicuous places in the
establishment before ratification and that it does not carry the sworn statement of
the union secretary and attested by the union president.
However, the Court did not rule on the defects of the CBA and only considered the
fact that it was entered into at a time when the PCE had already been filed by TUPAS
and was pending resolution. The CBA cannot be deemed permanent, precluding the
commencement of negotiations by another union with the management.
In the meantime, however, so as not to deprive the workers of the benefits of the
said agreement, it shall be recognized and given effect on a temporary basis, subject
to the results of the CE. The agreement may be continued in force if ATU is certified
as the exclusive bargaining representative of the workers or may be rejected and
replaced in the event that TUPAS emerges as the winner.
Therefore, certification election is allowed in the case at bar, the Court reiterates that
CE is the most democratic forum for the articulation by the workers of their choice of
the union that shall represent them in the negotiation of a CBA with their employer.
Hence, rather than being inhibited and delayed, the CE should be given every
encouragement under the law, that the will of the workers may be discovered and
through their freely chosen representatives, pursued and realized.
33|LabRel – Part IV-C
 47. ME-SHURN CORPORATION AND SAMMY CHOU vs. ME-SHURN WORKERS
UNION-FSM
ISSUES
(1) WON the dismissal of the employees of petitioner Meshurn Corporation is for an
authorized cause, and
(2) WON respondents can maintain a suit against petitioners.
HELD
1. NO. Basic is the rule in termination cases that the employer bears the burden of
showing that the dismissal was for a just or authorized cause. Otherwise, the
dismissal is deemed unjustified. Apropos this responsibility, petitioner corporation
should have presented clear and convincing evidence 24of imminent economic or
business reversals as a form of affirmative defense in the proceedings before the
labor arbiter or, under justifiable circumstances, even on appeal with the NLRC.
However, as previously stated, in all the proceedings before the two quasi-judicial
bodies and even before the CA, no evidence was submitted to show the corporation’s
alleged business losses. It is only now that petitioners have belatedly submitted the
corporation’s income tax returns from 1996 to 1999 as proof of alleged continued
losses during those years.
At any rate, even if we admit these additional pieces of evidence, the circumstances
surrounding the cessation of operations of the corporation reveal the doubtful
character of its supposed financial reason.
First, the claim of petitioners that they were compelled to close down the company
to prevent further losses is belied by their resumption of operations barely a month
after the corporation supposedly folded up.
Second, the Statements of Income and Deficit for the years 1996 and 1997 show that
at the beginning of 1996, the corporation had a deficit ofP2,474,505. Yet, the closure
was effected only after more than a year from such year-end deficit; that is, in the
middle of 1998, shortly after the formation of the union.
Scroll No. 577
Third, as a condition for the rehiring of the employees, the union officers were made
to sign an agreement that they would not form any union upon their return to work.
This move was contrary to law.
Fourth, notwithstanding the Petition for Certification Election filed by respondents
and despite knowledge of the pendency thereof, petitioners recognized a newly
formed union and hastily signed with it an alleged Collective Bargaining Agreement.
Their preference for the new union was at the expense of respondent
union.Moncada Bijon Factory v. CIR29held that an employer could be held guilty of
discrimination, even if the preferred union was not company-dominated.
Fifth, petitioners were not able to prove their allegation that some of the employees’
contracts had expired even before the cessation of operations. We find this claim
inconsistent with their position that all 342 employees of the corporation were paid
their separation pay plus accrued benefits in August 1998.
Sixth, proper written notices of the closure were not sent to the DOLE and the
employees at least one month before the effectivity date of the termination, as
required under the Labor Code. Notice to the DOLE is mandatory to enable the
proper authorities to ascertain whether the closure and/or dismissals were being
done in good faith and not just as a pretext for evading compliance with the
employer’s just obligations to the affected employees.30This requirement is intended
to protect the workers’ right to security of tenure. The absence of such requirement
taints the dismissal.
All these factors strongly give credence to the contention of respondents that the real
reason behind the shutdown of the corporation was the formation of their union.
Note that, to constitute an unfair labor practice, the dismissal need not entirely and
exclusively be motivated by the union’s activities or affiliations. It is enough that the
discrimination was a contributing factor.31If the basic inspiration for the act of the
employer is derived from the affiliation or activities of the union, the former’s
assignment of another reason, no matter how seemingly valid, is unavailing.
2. YES. Neither are we prepared to believe petitioners’ argument that respondent
union was not legitimate. It should be pointed out that on June 29, 1998, it filed a
Petition for Certification Election. While this Petition was initially dismissed by the
med-arbiter on the basis of a supposed retraction, note that the appeal was granted
34|LabRel – Part IV-C
and that Undersecretary Dimapilis-Baldoz ordered the holding of a certification
election.
The DOLE would not have entertained the Petition if the union were not a legitimate
labor organization within the meaning of the Labor Code. Under this Code, in an
unorganized establishment, only a legitimate union may file a petition for
certification election. Hence, while it is not clear from the record whether respondent
union is a legitimate organization, we are not readily inclined to believe otherwise,
especially in the light of the pro-labor policies enshrined in the Constitution and the
Labor Code.
Verily, the union has the requisite personality to sue in its own name in order to
challenge the unfair labor practice committed by petitioners against it and its
members."It would be an unwarranted impairment of the right to self-organization
through formation of labor associations if thereafter such collective entities would be
barred from instituting action in their representative capacity."
Finally, in view of the discriminatory acts committed by petitioners against
respondent union prior to the holding of the certification election on September 27,
2000 -- acts that included their immediate grant of exclusive recognition to another
union as a bargaining agent despite the pending Petition for certification election --
the results of that election cannot be said to constitute a repudiation by the affected
employees of the union’s right to represent them in the present case.
C. UNFAIR LABOR PRACTICES
1. MARIANO, versus. THE ROYAL INTEROCEAN LINES
Despite the employees' right to self-organization, the employer therefore still retains
his inherent right to discipline his employees, his normal prerogative to hire or
dismiss them. The prohibition is directed only against the use of the right to employ
or discharge as an instrument of discrimination, interference or oppression because
of one's labor or union activities. Even from a liberal and grammatical point of view,
the provision in dispute has to be interpreted in the sense that the charges, the filing,
of which is the cause of the dismissal of the employee, must be related to his right to
self-organization, in order to give rise to unfair labor practice on the part of the
employer. (Under subsection 5 of section 4(a), the employee's (1) having filed charges
or (2) having given testimony or (3) being about to give testimony, are modified by
"under this Act" appearing after the last item. In other words, the three acts must
Scroll No. 577
have reference to the employee's right to self-organization and collective bargaining,
because the element of unfair labor practice is interference in such right. It would be
redundant to repeat "under this Act" after each enumeration connected by the
disjunctive conjunction "or."
As the respondent's dismissal has no relation to union activities and the charges filed
by her against the petitioner had nothing to do with or did not arise from her union
activities, the appealed decision is hereby reversed and the directive for the
respondent's reinstatement with backpay revoked.
2. WISE AND CO., INC., versus. WISE & CO., INC. EMPLOYEES UNION-NATU
AND HONORABLE LAGUESMA
The Court holds that it is the prerogative of management to regulate, according to its
discretion and judgment, all aspects of employment. This flows from the established
rule that labor law does not authorize the of the employer in the conduct of its
business. 6 such management prerogative may be availed of without fear of any
liability so long as it is exercised in good faith for the advancement of the employers'
interest and not for the purpose of defeating or circumventing the rights of
employees under special laws or valid agreement and are not exercised in a
malicious, harsh, oppressive, vindictive or wanton manner or out of malice or spite. 7
The grant by petitioner of profit sharing benefits to the employees outside the
"bargaining unit" falls under the ambit of its managerial prerogative. It appears to
have been done in good faith and without ulterior motive. More so when as in this
case there is a clause in the CBA where the employees are classified into those who
are members of the union and those who are not. In the case of the union members,
they derive their benefits from the terms and conditions of the CBA contract which
constitute the law between the contracting parties. 8 Both the employer and the
union members are bound by such agreement.
3. DABUET versus. ROCHE PHARMACEUTICALS, INC., ERIC MENTHA,
REYNALDO FORMELOZA, and the OFFICE OF THE PRESIDENT
In Republic Savings Bank vs. CIR, 7 where the dismissed employees had written a
letter decried by the Bank as patently libelous for alleging immorality, nepotism and
favoritism on the part of the Bank president, thus amounting to behavior
necessitating their dismissal, the Court declared:
... Assuming that the workers acted in their individual capacities when they
wrote the letter-charge they were nonetheless protected for they were
35|LabRel – Part IV-C
 engaged in concerted activity, in the exercise of their right to self-
organization that includes concerted activity for mutual aid and protection,
interference with which constitutes an unfair labor practice under section
4(a) (1). As has been aptly stated, the joining in protests or demands, even
by a small group of employees, if in furtherance of their interests as such, is
a concerted activity protected by the Industrial Peace Act. It is not necessary
that union activity be involved or that collective bargaining be contemplated.
We, thus, hold that respondent company's act in dismissing the Petitioners, who then
constituted the remaining and entire officialdom of the Roche Products Labor Union,
after the union's president and vice-president had been earlier dismiss and when the
collective bargaining agreement in the company was about to be renegotiated, was
an unfair labor practice under Sec. 4(a) (1) of the Industrial Peace Act. Their dismissal,
under the circumstances, amounted to interference with, and restraint or coercion
of, the petitioners in the exercise of their right to engage in concerted activities for
their mutual aid and protection
As the respondent company was guilty of unfair labor practice, reinstatement of the
dismissed employees should follow as a matter of right. It is an established rule that
an employer who commits an unfair labor practice may be required to reinstate, with
full back wages, the workers affected by such act, the amount not to exceed back
wages for three (3) years.
4. JUDRIC CANNING CORPORATION, vs. INCIONG
Under Article 248(a) of the Labor Code of the Philippines, "to interfere with, restrain,
or coerce employees in their exercise of the right to self-organization" is an unfair
labor practice on the part of the employer. Paragraph (d) of said Article also considers
it an unfair labor practice for an employer "to initiate, dominate, assist or otherwise
interfere with the formation or administration of any labor organization, including the
giving of financial or other support to it. In this particular case, the private
respondents were dismissed or their services were terminated, because they were
soliciting signatures in order to form a union within the plant.
The error of the Regional Director in stating that the dismissal of the private
respondents was without just cause in view of the absence of prior clearance from
the Ministry of Labor is, thus, not sufficient to warrant a reversal of the questioned
order. Prior clearance with the Ministry of Labor for the termination of the private
respondents is not necessary in this case since the private respondents have been
employed with the petitioner corporation for less than one (1) year. Section 1, Rule
XIV, Book V of the Implementing Rules and Regulations.
Scroll No. 577
5. CLLC E.G. GOCHANGCO WORKERS UNION, vs. NLRC, and GOCHANGCO,
INC.
Respondent company is guilty of an unfair labor practice. It is no coincidence that at
the time said respondent issued its suspension and termination orders, the
petitioners were in the midst of a certification election preliminary to a labor
management conference, purportedly, "to normalize employer-employee
relations." 5 It was within the legal right of the petitioners to do so, the exercise of
which was their sole prerogative, and in which management may not as a rule
interfere.
Before Batas Blg. 70 29 was enacted into law, unfair labor practices were considered
administrative offenses, 30 and have been held akin to tort, 31 wherein damages are
payable. We therefore not only order herein the reinstatement of the petitioners and
the payment of backwages (including cost-of-living allowances) to them, but impose
as well moral and exemplary damages. With respect to backwages, we hold the
respondent e.g. Gochangco, Inc. liable, in line with the recommendation of the
Solicitor General and in accordance with accepted practice, for backwages equivalent
to three (3) years without qualification or deduction. 32
If only for emphasis, the new Constitution considers "labor as a primary social
economic force." 34 As the conscience of the government, it is this Court's sworn duty
to ensure that none trifles with labor rights.
6. CARLOS CRUZ vs. PHILIPPINE ASSOCIATION LABOR UNIONS (PAFLU)
Thus: "But a buyer should not be allowed to reap and enjoy all the profits of a sale
without the corresponding responsibilities that are attached to the industrial
enterprise, specially so when the sale was executed under dubious circumstances. If it
is so the convenience of ridding the management of any labor problem is easily
facilitated by simulating a sale everytime the laboring elements agitate the protection
of their rights. That is why under the present condition, responsibility should be
shared by both the buyer and the seller otherwise the efforts of the workers would
have been futile and fruitless, since they would naturally face a blank wall after the
sale.
There is likewise an error assigned by petitioner Cruz that labor contracts being in
personam are not enforceable against a transferee of an enterprise, there being no
previous employer-employee relationship existing between the new owner and the
36|LabRel – Part IV-C
complaining employees. It suffices to state that petitioner Cruz is in the position of a
tort-feasor having been a party likewise responsible for the damage inflicted on the
members of respondent Union and therefore cannot justly escape liability.
7. THE INSULAR LIFE ASSURANCE CO., LTD., EMPLOYEES ASSOCIATION-NATU,
vs. THE INSULAR LIFE ASSURANCE CO., LTD., FGU INSURANCE GROUP, JOSE
M. OLBES and COURT OF INDUSTRIAL RELATIONS
Indeed, it is an unfair labor practice for an employer operating under a collective
bargaining agreement to negotiate or to attempt to negotiate with his employees
individually in connection with changes in the agreement. And the basis of the
prohibition regarding individual bargaining with the strikers is that although the union
is on strike, the employer is still under obligation to bargain with the union as the
employees' bargaining representative.
When the respondents offered reinstatement and attempted to "bribe" the strikers
with "comfortable cots," "free coffee and occasional movies," "overtime" pay for
"work performed in excess of eight hours," and "arrangements" for their families, so
they would abandon the strike and return to work, they were guilty of strike-breaking
and/or union-busting and, consequently, of unfair labor practice. It is equivalent to an
attempt to break a strike for an employer to offer reinstatement to striking
employees individually, when they are represented by a union, since the employees
thus offered reinstatement are unable to determine what the consequences of
returning to work would be.
The test of whether an employer has interfered with and coerced employees within
the meaning of subsection (a) (1) is whether the employer has engaged in conduct
which it may reasonably be said tends to interfere with the free exercise of
employees' rights under section 3 of the Act, and it is not necessary that there be
direct evidence that any employee was in fact intimidated or coerced by statements
of threats of the employer if there is a reasonable inference that anti-union conduct
of the employer does have an adverse effect on self-organization and collective
bargaining.
"Totality of conduct doctrine,"
... whereby the culpability of an employer's remarks were to be evaluated
not only on the basis of their implicit implications, but were to be appraised
against the background of and in conjunction with collateral circumstances.
Under this "doctrine" expressions of opinion by an employer which, though
innocent in themselves, frequently were held to be culpable because of the
Scroll No. 577
circumstances under which they were uttered, the history of the particular
employer's labor relations or anti-union bias or because of their connection
with an established collateral plan of coercion or interference.
So there is unfair labor practice where the employer, although authorized by the
Court of Industrial Relations to dismiss the employees who participated in an illegal
strike, dismissed only the leaders of the strikers, such dismissal being evidence of
discrimination against those dismissed and constituting a waiver of the employer's
right to dismiss the striking employees and a condonation of the fault committed by
them."
Delayed reinstatement is a form of discrimination in rehiring, as is having the
machinery of reinstatement in the hands of employees hostile to the strikers, and
reinstating a union official who formerly worked in a unionized plant, to a job in
another mill, which was imperfectly organized.
Section 9(a)(5) of Republic Act 875 which guarantees the untrammeled exercise by
striking employees of the right to give "publicity to the existence of, or the fact
involved in any labor dispute, whether by advertising, speaking, patrolling or by any
method not involving fraud or violence." Indeed, it is not only the right, it is as well
the duty, of every unionist to advertise the facts of a dispute for the purpose of
informing all those affected thereby. In labor disputes, the combatants are expected
to expose the truth before the public to justify their respective demands. Being a
union man and one of the strikers, Tongos was expected to reveal the whole truth on
whether or not the respondent Companies were justified in refusing to accede to
union demands. After all, not being one of the supervisors, he was not a part of
management. And his statement, if indeed made, is but an expression of free speech
protected by the Constitution.
The heated altercations and occasional blows exchanged on the picket line do not
affect or diminish the right to strike. Some disorder is unfortunately quite usual in any
extensive or long drawn out strike. A strike is essentially a battle waged with
economic weapons. Engaged in it are human beings whose feelings are stirred to the
depths. Rising passions call forth hot words. Hot words lead to blows on the picket
line. The transformation from economic to physical combat by those engaged in the
contest is difficult to prevent even when cool heads direct the fight. Violence of this
nature, however much it is to be regretted, must have been in the contemplation of
the Congress when it provided in Sec. 13 of Act 29 USCA Sec. 163, that nothing
therein should be construed so as to interfere with or impede or diminish in any way
the right to strike. If this were not so, the rights afforded to employees by the Act
would indeed be illusory.
37|LabRel – Part IV-C
It has been held in a great number of decisions at espionage by an employer of union
activities, or surveillance thereof, are such instances of interference, restraint or
coercion of employees in connection with their right to organize, form and join
unions as to constitute unfair labor practice. The information obtained by means of
espionage is in valuable to the employer and can be used in a variety of cases to
break a union." The unfair labor practice is committed whether the espionage is
carried on by a professional labor spy or detective, by officials or supervisory
employees of the employer, or by fellow employees acting at the request or direction
of the employer, or an ex-employee.
[W]here the employers' "unfair labor practice" caused or contributed to the strike or
where the 'lock-out' by the employer constitutes an "unfair labor practice," the
employer cannot successfully urge as a defense that the striking or lock-out
employees position has been filled by replacement. Under such circumstances, if no
job sufficiently and satisfactorily comparable to that previously held by the aggrieved
employee can be found, the employer must discharge the replacement employee, if
necessary, to restore the striking or locked-out worker to his old or comparable
position ... If the employer's improper conduct was an initial cause of the strike, all
the strikers are entitled to reinstatement and the dismissal of replacement
employees wherever necessary;
In a proceeding for unfair labor practice, involving a determination as to whether or
not the acts of the employees concerned justified the adoption of the employer of
disciplinary measures against them, the mere fact that the employees may be able to
put up a valid defense in a criminal prosecution for the same acts, does not erase or
neutralize the employer's right to impose discipline on said employees. For it is
settled that not even the acquittal of an employee of the criminal charge against him
is a bar to the employer's right to impose discipline on its employees, should the act
upon which the criminal charged was based constitute nevertheless an activity
inimical to the employer's interest.
8. COMPLEX ELECTRONICS EMPLOYEES ASSOCIATION (CEEA) vs. NLRC
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, but the term is
also used to describe a plant removed to a new location in order to discriminate
against employees at the old plant because of their union
activities. 14 It is one wherein the employer moves its business to another location or
it temporarily closes its business for anti-union purposes. 15 A "runaway shop" in this
sense, is a relocation motivated by anti-union animus rather than for business
reasons. In this case, however, Ionics was not set up merely for the purpose of
Scroll No. 577
transferring the business of Complex. At the time the labor dispute arose at Complex,
Ionics was already existing as an independent company. As earlier mentioned, it has
been in existence since July 5, 1984. It cannot, therefore, be said that the temporary
closure in Complex and its subsequent transfer of business to Ionics was for anti-
union purposes. The Union failed to show that the primary reason for the closure of
the establishment was due to the union activities of the employees.
Mere ownership by a single stockholder or by another corporation of all or nearly all
of the capital stock of a corporation is not of itself sufficient ground for disregarding
the separate corporate personality. Ionics may be engaged in the same business as
that of Complex, but this fact alone is not enough reason to pierce the veil of
corporate fiction of the corporation. Well-settled is the rule that a corporation has a
personality separate and distinct from that of its officers and stockholders. This
fiction of corporate entity can only be disregarded in certain cases such as when it is
used to defeat public convenience, justify wrong, protect fraud, or defend
crime. 19 To disregard said separate juridical personality of a corporation, the
wrongdoing must be clearly and convincingly established. 20
We, likewise, disagree with the Union that there was in this case an illegal
lockout/illegal dismissal. Lockout is the temporary refusal of employer to furnish
work as a result of an industrial or labor dispute. 21 It may be manifested by the
employer's act of excluding employees who are union members. 22 In the present
case, there was a complete cessation of the business operations at Complex not
because of the labor dispute. It should be recalled that, before the labor dispute,
Complex had already informed the employees that they would be closing the Lite-On
Line.
At first glance after reading the decision a quo, it would seem that the closure of
respondent's operation is not justified. However, a deeper examination of the
records along with the evidence, would show that the closure, although it was done
abruptly as there was no compliance with the 30-day prior notice requirement, said
closure was not intended to circumvent the provisions of the Labor Code on
termination of employment. The closure of operation by Complex was not without
valid reasons. Customers of respondent alarmed by the pending labor dispute and
the imminent strike to be foisted by the union, as shown by their strike vote, directed
respondent Complex to pull-out its equipment, machinery and materials to other safe
bonded warehouse. Respondent being mere consignees of the equipment, machinery
and materials were without any recourse but to oblige the customers' directive. The
determination to cease operation is a prerogative of management that is usually not
interfered with by the State as no employer can be required to continue operating at
a loss simply to maintain the workers in employment. That would be taking of
property without due process of law which the employer has the right to resist.
(Columbia Development Corp. vs. Minister of Labor and Employment, 146 SCRA 42).
38|LabRel – Part IV-C
In any case, Article 283 of the Labor Code is clear that an employer may close or
cease his business operations or undertaking even if he is not suffering from serious
business losses or financial reverses, as long as he pays his employees their
termination pay in the amount corresponding to their length of service. It would
indeed, be stretching the intent and spirit of the law if we were to unjustly interfere
in management's prerogative to close or cease its business operations just because
said business operations or undertaking is not suffering from any loss.
It is settled that in case of closures or cessation of operation of business
establishments not due to serious business losses or financial reverses, 31 the
employees are always given separation benefits.
9. TANDUAY DISTILLERY LABOR UNION vs. NLRC
We enforce basic principles essential to a strong and dynamic labor movement. An
established postulate in labor relations firmly rooted in this jurisdiction is that the
dismissal of an employee pursuant to a demand of the majority union in accordance
with a union security agreement following the loss of seniority rights is valid and
privileged and does not constitute an unfair labor practice.
Article 249 (e) of the Labor Code as amended specifically recognizes the closed shop
arrangement as a form of union security. The closed shop, the union shop, the
maintenance of membership shop, the preferential shop, the maintenance of
treasury shop, and check-off provisions are valid forms of union security and
strength. They do not constitute unfair labor practice nor are they violations of the
freedom of association clause of the Constitution.
Another reason for enforcing the closed-shop agreement is the principle of sanctity
or inviolability of contracts guaranteed by the Constitution. Having ratified tha CBA
and being then members of the TDLU, the private respondents owe fealty and are
required under the Union Security Clause to maintain their membership in good
standing with it during the term thereof, a requirement which ceases to be binding
only during the 60-day freedom period immediately preceding the expiration of the
CBA. When the private respondents organized and joined the KAMPIL Chapter in TDI
and filed the corresponding petition for certification election in November 1980,
there was no freedom period to speak of yet.
Finally, even if we assume,that the petition were unaware of the stipulation set forth
in the collective bargaining agreement since their membership in the BBLU prior to t
the expulsion thereform is undenied there can be no question that as long as the
agreement with closed-shop provision was in force they were bound by it. Neither
Scroll No. 577
their ignorance of,nor their dissatisfaction with, its terms and condition would justify
breach thereof or the formation by them of a union of their own.As has been aptly
said the collective bargaining agreement entered into by officers of a union as agent
of the member,and an employer,gives rise to valid inforcible contractual relation
against the individual union members in matters that affect the entire membership or
large classes of its member who employed under an agreement between the union
and his employer is bound by the provision thereof,since it is a joint and several
contract of the members of the union and entered into by the union as their agent.
But the fact that the CBA had expired on June 30, 1982 and the BLR, because of such
supervening event, ordered the holding of a certification election could not and did
not wipe out or cleanse private respondents from the acts of disloyalty committed
when they organized KAMPIL's local chapter in TDI while still members of TDLU. The
ineluctable fact is that private respondents committed acts of disloyalty against TDLU
while the CBA was in force and existing for which they have to face the necessary
sanctions lawfully imposed by TDLU. In Villar v. Inciong, we held that "petitioners,
although entitled to disaffiliation from their union and 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.
Inherent in every labor union, or any organization for that matter, is the
right of self-preservation. When members of a labor union, therefore, sow
the seeds of dissension and strife within the union; when they seek the
disintegration and destruction of the very union to which they belong; they
thereby forfeit their rights to remain as members of the union which they
seek to destroy.
10. CONFEDERATED SONS OF LABOR vs. ANAKAN LUMBER COMPANY, UNITED
WORKERS' UNION
A "closed shop" may be defined as an enterprise in which, agreement between the
employer and his employees or their representatives, no person may be employed in
any or certain agreed departments of the enterprise unless he or she is, becomes,
and, for duration of the agreement, remains a member in good standing for a union
entirely comprised of or of which the employees in interest are a part.
Inasmuch as Article II does not provide that employees "must continue to remain
members in good standing" of respondent union "to keep their jobs," the collective
bargain-agreement between them does not establish a 'closed shop," except in a very
limited sense, namely, that the laborers, employees and workers engaged by the
company after the signing of the agreement on January 23, 1955, must be members
39|LabRel – Part IV-C
of respondent union. The agreement does not affect the right of the company to
retain those already working therefor on or before said date, or those hired or
employed subsequently thereto, while they were members of respondent union, but
who, thereafter, resign or are expelled therefrom.
In order that an employer may be deemed bound, under a collective bargaining
agreement, to dismiss employees for non-union membership, the stipulation to this
effect must be so clear and unequivocal as to leave no room for doubt thereon. An
undertaking of this nature is so harsh that it must be strictly construed, and doubts
must be resolved against the existence of "closed shop." If the parties to the
agreement intended to establish a "closed shop", in the strict sense of the phrase,
they would have inserted in said Article III-a, among the grounds for dismissal by the
company therein specified the discontinuance of membership in respondent union.
Their failure to make such insertion strongly indicates that said discontinuance of
membership was not understood to be a ground for dismissal.
11. KAPISANAN NG MGA MANGGAGAWA NG ALAK (NAFLU) vs.HAMILTON
DISTILLERY COMPANY, CO BON BENG, MARIANO ANG ENG and HAMILTON
WORKERS' UNION
In this connection, it is well settled in this jurisdiction that, in the absence of a
manifest intent to the contrary, "closed shop" provisions in a collective bargaining
agreement "apply only to persons to be hired or to employees who are not
yet members of any labor organization" and that said provisions of the agreement are
"not applicable to those already in the service at the time of its execution."
The closed-shop agreement authorized under sec. 4, subsec. a(4) of the Industrial
Peace Act above quoted should however, apply only to persons to be hired or to
employees who are not yet members of any labor organization. It is inapplicable to
those already in the service who are members of another union. To hold otherwise,
i.e., that the employees in a company who are members of a minority union may be
compelled to disaffiliate from their union and join the majority or contracting union,
would render nugatory the right of all employees to self organization and to form,
join or assist labor organizations of their own choosing, a right guaranteed by the
Industrial Peace Act (sec. 3, Rep. Act No. 875) as well as by the Constitution (Art. III,
sec. 1[6]).
12. NORMA MABEZA vs. NLRC
Scroll No. 577
It is settled that in termination cases the employer bears the burden of proof to show
that the dismissal is for just cause, the failure of which would mean that the dismissal
is not justified and the employee is entitled to reinstatement. 14 Loss of confidence as
a just cause for dismissal was never intended to provide employers with a blank
check for terminating their employees. It should ideally apply only to cases involving
employees occupying positions of trust and confidence or to those situations where
the employee is routinely charged with the care and custody of the employer's
money or property.
The act of compelling employees to sign an instrument indicating that the employer
observed labor standards provisions of law when he might have not, together with
the act of terminating or coercing those who refuse to cooperate with the employer's
scheme constitutes unfair labor practice. The first act clearly preempts the right of
the hotel's workers to seek better terms and conditions of employment through
concerted action. This actuation is analogous to the situation envisaged in paragraph
(f) of Article 248 of the Labor Code" which distinctly makes it an unfair labor practice
"to dismiss, discharge or otherwise prejudice or discriminate against an employee for
having given or being about to give testimony" 25 under the Labor Code. For in not
giving positive testimony in favor of her employer, petitioner had reserved not only
her right to dispute the claim and proffer evidence in support thereof but also to
work for better terms and conditions of employment.
13. PICOP RESOURCES, INCORPORATED vs. RICARDO DEQUILLA
"Union security" is a generic term, which is applied to and comprehends "closed
shop," "union shop," "maintenance of membership," or any other form of agreement
which imposes upon employees the obligation to acquire or retain union membership
as a condition affecting employment. There is union shop when all new regular
employees are required to join the union within a certain period as a condition for
their continued employment. There is maintenance of membership shop when
employees, who are union members as of the effective date of the agreement, or
who thereafter become members, must maintain union membership as a condition
for continued employment until they are promoted or transferred out of the
bargaining unit, or the agreement is terminated. A closed shop, on the other hand,
may be defined as an enterprise in which, by agreement between the employer and
his employees or their representatives, no person may be employed in any or certain
agreed departments of the enterprise unless he or she is, becomes, and, for the
duration of the agreement, remains a member in good standing of a union entirely
comprised of or of which the employees in interest are a part.13
40|LabRel – Part IV-C
When an employer exercises its power to terminate an employee by enforcing the
union security clause, it needs to determine and prove the following: (1) the union
security clause is applicable; (2) the union is requesting for the enforcement of the
union security provision in the CBA; and (3) there is sufficient evidence to support the
decision of the union to expel the employee from the union.14
PICOP failed to show in detail how private respondents campaigned and supported
FFW. Their mere act of signing an authorization for a petition for certification election
before the freedom period does not necessarily demonstrate union disloyalty per se
considering that the petition for certification election itself was filed during the
freedom period. Moreover, the records are bereft of proof of any contemporaneous
acts of resignation or withdrawal of union membership or non-payment of union
dues. Neither is there proof that private respondents joined FFW. The fact is, private
respondents remained in good standing with their union.
Strictly speaking, what is prohibited is the filing of a petition for certification election
outside the 60-day freedom period. This is not the situation in this case. If at all, the
signing of the authorization to file a certification election was merely preparatory to
the filing of the petition for certification election, or an exercise of respondents’ right
to self-organization.16
While it is incumbent for the employer to continue to recognize the majority status of
the incumbent bargaining agent even after the expiration of the freedom period, they
could only do so when no petition for certification election was filed. The reason is,
with a pending petition for certification, any such agreement entered into by
management with a labor organization is fraught with the risk that such a labor union
may not be chosen thereafter as the collective bargaining representative. The
provision for status quo is conditioned on the fact that no certification election was
filed during the freedom period.
Moreover, the last sentence of Article 253 which provides for automatic renewal
pertains only to the economic provisions of the CBA, and does not include
representational aspect of the CBA. An existing CBA cannot constitute a bar to a filing
of a petition for certification election. When there is a representational issue,
the status quo provision in so far as the need to await the creation of a new
agreement will not apply. Otherwise, it will create an absurd situation where the
union members will be forced to maintain membership by virtue of the union security
clause existing under the CBA and, thereafter, support another union when filing a
petition for certification election. If we apply it, there will always be an issue of
disloyalty whenever the employees exercise their right to self-organization. The
holding of a certification election is a statutory policy that should not be
circumvented, or compromised.
Scroll No. 577
Time and again, we have ruled that we adhere to the policy of enhancing the welfare
of the workers. Their freedom to choose who should be their bargaining
representative is of paramount importance. The fact that there already exists a
bargaining representative in the unit concerned is of no moment as long as the
petition for certification election was filed within the freedom period. What is
imperative is that by such a petition for certification election the employees are given
the opportunity to make known of who shall have the right to represent them
thereafter. Not only some, but all of them should have the right to do so. What is
equally important is that everyone be given a democratic space in the bargaining unit
concerned.
14. PICOP RESOURCES, INCORPORATED (PRI), vs. ANACLETO L. TAÑECA,
In terminating the employment of an employee by enforcing the union security
clause, the employer needs to determine and prove that: (1) the union security clause
is applicable; (2) the union is requesting for the enforcement of the union security
provision in the CBA; and (3) there is sufficient evidence to support the decision of
the union to expel the employee from the union. These requisites constitute just
cause for terminating an employee based on the union security provision of the
CBA.16
However, as to the third requisite, we find that there is no sufficient evidence to
support the decision of PRI to terminate the employment of the respondents.
The mere signing of the authorization in support of the Petition for Certification
Election of FFW before the "freedom period," is not sufficient ground to terminate
the employment of respondents inasmuch as the petition itself was actually filed
during the freedom period. Nothing in the records would show that respondents
failed to maintain their membership in good standing in the Union. Respondents did
not resign or withdraw their membership from the Union to which they belong.
Respondents continued to pay their union dues and never joined the FFW. An
"authorization letter to file a petition for certification election" is different from an
actual "Petition for Certification Election." If at all, the signing of the authorization to
file a certification election was merely preparatory to the filing of the petition for
certification election, or an exercise of respondents’ right to self-organization.
We will emphasize anew that the power to dismiss is a normal prerogative of the
employer. This, however, is not without limitations. The employer is bound to
exercise caution in terminating the services of his employees especially so when it is
made upon the request of a labor union pursuant to the Collective Bargaining
Agreement. Dismissals must not be arbitrary and capricious. Due process must be
41|LabRel – Part IV-C
observed in dismissing an employee, because it affects not only his position but also
his means of livelihood. Employers should, therefore, respect and protect the rights
of their employees, which include the right to labor.25
An employee who is illegally dismissed is entitled to the twin reliefs of full backwages
and reinstatement. If reinstatement is not viable, separation pay is awarded to the
employee. In awarding separation pay to an illegally dismissed employee, in lieu of
reinstatement, the amount to be awarded shall be equivalent to one month salary for
every year of service. Under Republic Act No. 6715, employees who are illegally
dismissed are entitled to full backwages, inclusive of allowances and other benefits,
or their monetary equivalent, computed from the time their actual compensation
was withheld from them up to the time of their actual reinstatement. But if
reinstatement is no longer possible, the backwages shall be computed from the time
of their illegal termination up to the finality of the decision. Moreover, respondents,
having been compelled to litigate in order to seek redress for their illegal dismissal,
are entitled to the award of attorney’s fees equivalent to 10% of the total monetary
award.26
THIRD DIVISION
[G.R. No. 152094. July 22, 2004]
DHL PHILIPPINES CORPORATION UNITED RANK
AND FILE ASSOCIATION-FEDERATION OF
FREE WORKERS (DHL-URFA-
FFW), petitioner, vs. BUKLOD NG
MANGGAGAWA NG DHL PHILIPPINES
CORPORATION, respondent.
DECISION
PANGANIBAN, J.:
False statements made by union officers before and during a
certification election -- that the union is independent and not
Scroll No. 577
affiliated with a national federation -- are material facts likely to
influence the election results. This principle finds application in
the present case in which the majority of the employees clearly
wanted an independent union to represent them. Thus, after the
members learned of the misrepresentation, and after a majority of
them disaffiliated themselves from the union and formed another
one, a new certification election should be held to enable them to
express their true will.
The late filing of the Petition for a new election can be
excused under the peculiar facts of this case, considering that the
employees concerned did not sleep on their rights, but promptly
acted to protect their prerogatives. Petitioner should not be
permitted to use legal technicalities to perpetrate the betrayal
foisted by its officers upon the majority of the
employees.Procedural technicalities should not be allowed to
suppress the welfare of labor.
The Case
Before us is a Petition for Review[1] under Rule 45 of the
Rules of Court, seeking to annul the December 17,
1999 Decision[2] and the January 30, 2002 Resolution[3] of the
Court of Appeals (CA) in CA-GR SP No. 53270. The assailed
Decision disposed as follows:
WHEREFORE, the petition is hereby given due
course. Accordingly, the decision of Rosalinda Dimapilis-
[B]aldoz, Undersecretary of Labor, in behalf of [the] Secretary
of Labor and Employment, is hereby ANNULED and SET
ASIDE and DECLARED to have NO EFFECT whatsoever.
Public respondent and its representatives are hereby enjoined to
refrain and desist from implementing the said decision. [4]
The challenged Resolution denied petitioners Motion for
Reconsideration.
42|LabRel – Part IV-C
 The Facts in favor of petitioner, and that no petitions for certification election
would be entertained within one year from the time the election
officer had issued the Certification Order.
On November 25, 1997, a certification election was
conducted among the regular rank and file employees in the main
office and the regional branches of DHL Philippines
Ruling of the Court of Appeals
Corporation. The contending choices were petitioner and no
union.
The CA held that the withdrawal of a great majority of the
On January 19, 1998, on the basis of the results of the
members of petitioner -- 704 out of 894 of them -- provided a
certification election, with petitioner receiving 546 votes and no
compelling reason to conduct a certification election anew in
union garnering 348 votes, the election officer certified the former
order to determine, once and for all, which union reflected their
as the sole and exclusive bargaining agent of the rank and file
choice. Under the circumstances, the issue of representation was
employees of the corporation.[5]
not put to rest by the mere issuance of a Certification Order by
Meanwhile, on December 19, 1997, Respondent Buklod ng the election officer.
Manggagawa ng DHL Philippines Corporation (BUKLOD) filed
According to the appellate court, broader considerations
with the Industrial Relations Division of the Department of Labor
should be accorded the disaffiliating member-employees and a
and Employment (DOLE) a Petition for the nullification of the
new election held to finally ascertain their will, consistent with the
certification election. The officers of petitioner were charged with
constitutional and labor law policy of according full protection to
committing fraud and deceit in the election proceedings,
labors right to self-organization. The CA added that the best
particularly by misrepresenting to the voter-employees that it was
forum to determine the veracity of the withdrawal or retraction of
an independent union, when it was in fact an affiliate of the
petitioners former members was another certification election.
Federation of Free Workers (FFW).
The appellate court also held that the election officers
This misrepresentation was supposedly the basis for their
issuance of a Certification Order on January 19, 1998 was
selection of petitioner in the certification election. Allegedly
precipitate because, prior thereto, respondent had filed with the
supporting this claim was the fact that those whom it had misled
med-arbiter a Petition for nullification of the election. Furthermore,
allegedly withdrew their membership from it and subsequently
the Certification was not in accordance with Department Order
formed themselves into an independent union. The latter union,
No. 9 (DO 9), Series of 1997. The charges of fraud and deceit,
BUKLOD, was issued a Certificate of Registration by DOLE
lodged immediately after the election by petitioners former
on December 23, 1997.
members against their officers, should have been treated as
On May 18, 1998, Med-Arbiter Tomas F. Falconitin nullified protests or issues of eligibility within the meaning of Section 13 of
the November 25, 1997 certification election and ordered the DO 9.
holding of another one with the following contending
Hence, this Petition.[6]
choices: petitioner, respondent, and no choice.
Setting aside the Decision of Med-Arbiter Falconitin, DOLE
Undersecretary Rosalinda Dimapilis-Baldoz held on appeal that Issues
the issue of representation had already been settled with finality

Scroll No. 577 43|LabRel – Part IV-C

 In its Memorandum, petitioner submits the following issues
for our consideration:
I
Whether or not the Court of Appeals seriously erred and
committed grave abuse of discretion amounting to lack and/or
excess of jurisdiction when it annul[l]ed, set aside, and declared
to have no effect whatsoever, the Decision of Undersecretary
Rosalinda Dimapilis-Baldoz, which in effect, reinstated and
affirmed the Decision of the Med-Arbiter, nullifying the result
of the certification election as well as ordering the conduct of a
new certification election at DHL Philippines Corporation,
considering that:
(A) The Court of Appeals, as well as the Med-Arbiter, ignored
the undisputed fact that petitioner a quo (herein respondent) has
not yet existed before, during and shortly after the conduct of
certification election on November 25, 1997, and not yet even
registered at the time of the filing of its Petition a quo on
December 19, 1997, therefore, has no legal personality to
institute an action.
(B) The Court of Appeals, as well as the Med-Arbiter ignored
and unjustifiably refused to apply Section 13, Rule XII of
Department Order No. 9, there being no protest nor challenge
raised before, during and even after five (5) days have lapsed
from the conduct of the certification election on November 25,
1997, as the Petition a quo was only filed on December 19,
1997 a week before herein respondent was able to obtain its
Certificate of Registration.
(C) The Court of Appeals ignored and unjustifiably refused to
apply Section 3, Rule V of Department Order No. 9, or
commonly know[n] as the Certification-Year Rule, which
means that no certification election should be entertained within
Scroll No. 577
one (1) year from the time the Election Officer issued the
Certification Order.
II
Whether or not the Court of Appeals seriously erred and
committed grave abuse of discretion, amounting to lack and/or
excess of jurisdiction in rendering the assailed Decision
promulgated on December 17, 1999, as the same was rendered
without the [Office of the] Solicitor General having filed its
comment on the Petition a quo, despite having filed a
Manifestation with Motion to the effect of not having received
the Petition filed by petitioner a quo, which [h]as remained
unacted upon; as well as the Resolution promulgated on January
30, 2002, which denied herein petitioners Motion for
Reconsideration, which was rendered without the required
comment thereon by the Petitioner a quo, thus, due process was
violated.
III
Whether or not the Court of Appeals seriously erred and
committed grave abuse of discretion amounting to lack and/or
excess of jurisdiction in holding that the resignation,
withdrawal, retraction of the great majority of the former
members of United DHL should be treated as disaffiliation from
such union.
IV
Whether or not, the Court of Appeals seriously erred and
committed grave abuse of discretion amounting to lack and/or
excess of jurisdiction in declaring that x x x while in the
February 28, 1996 x x x decision of Med-Arbiter Tomas
Falconitin provides for a certification election among two (2)
44|LabRel – Part IV-C
specific choices: the private respondent (then as petitioner), and
No Union as the contending choices, what was conducted on
November 25, 1996 (sic) was a referendum on a choice of yes
or no and not certification order of the Election Officer
reflecting the results in the number of yes votes and no votes,
without indicating the name of the contending choices.
V hearing or submission of memoranda or the expiration of the
Whether or not the Court of Appeals placed both parties in
Limbo, as the dispositive portion of the Decision or
the fallo, which x x x actually constitutes the judgment or
resolution of the court, failed to specify what should be done by
the parties after the rendition of the said Decision and
Resolution, thus, there can be no subject of execution. [7]
In simpler terms, the issues being raised are as follows: 1)
the validity of the CA Decision and Resolution; and 2) the validity
of the certification election.
The Courts Ruling
The Petition lacks merit.
First Issue:
Validity of the CA Decision and Resolution
Petitioner assails the validity of the CA Decision for having
been rendered without receipt of the required comment of the
Office of the Solicitor General (OSG) on respondents Petition;
and the CA Resolution for having been issued without receipt of
respondents comment on petitioners Motion for Reconsideration.
This contention is untenable.
Scroll No. 577
The applicable provision is Section 8 of Rule 65 of the Rules
of Court, which provides:
SECTION 8. Proceedings after comment is filed. -- After the
comment or other pleadings required by the court are filed, or
the time for the filing thereof has expired, the court may hear the
case or require the parties to submit memoranda. If after such
period for the filing thereof the court finds that the allegations of
the petition are true, it shall render judgment for the relief
prayed for or to which the petitioner is entitled. x x x. (Italics
supplied)
From the foregoing provision, it is clear that the Petition may
be resolved, notwithstanding the failure of the adverse party to
file a comment. Its failure to do so despite due notice is its own
lookout. Indeed, when a respondent fails to file its comment
within the given period, the court may decide the case on the
basis of the records before it, specifically the petition and its
attachments.[8]
Petitioner insists that the failure of the OSG to receive a copy
of the Petition filed before the CA was the reason for the OSGs
failure to file a Comment thereon. Be that as it may, as correctly
pointed out by respondent, petitioner is not the proper party to
invoke such failure.
At any rate, it is the duty of petitioner to defend its position, as
well as those that upheld it -- the tribunal, the board and the
officer -- because it is the party that is ultimately interested in
sustaining the correctness of the disposition or the validity of the
proceedings.[9]
Petitioner further assails the validity of the CA Decision, on
the ground that its dispositive portion or fallo failed to specify
what should be done by the parties after its promulgation.
All that the law requires is that the judgment must be
definitive. That is, the rights of the parties must be stated with
45|LabRel – Part IV-C
finality by the decision itself, which must thus specifically deny or
grant the remedy sought by the action.[10] For review by the CA
was Undersecretary Dimapilis-Baldozs Resolution reversing the
Decision of Med-Arbiter Falconitin.
Parenthetically, the ultimate question presented before the
appellate court was whether a new certification election should be
conducted among the employees of DHL Philippines
Corporation. As correctly pointed out by respondent, in reversing
the undersecretarys Resolution, the CA necessarily reinstated the
med-arbiters earlier Decision to conduct a new certification
election.
A judgment is not confined to what appears on the face of the
decision; it encompasses matters necessarily included in or are
necessary to such judgment.[11] The Decision of Med-Arbiter
Falconitin and Undersecretary Dimapilis-Baldoz should be read in
the context of and in relation to the assailed Decision of the
CA. The setting aside of the undersecretarys Resolution
necessarily implies the holding of a new certification election by
the med-arbiter upon receipt of the records of the case and the
motion of the interested party.
Second Issue:
Validity of the Certification Election
Under Section 13 of the Rules Implementing Book V (Labor
Relations) of the Labor Code,[12] as amended, the election officers
authority to certify the results of the election is limited to situations
in which there has been no protest filed; or if there has been any,
it has not been perfected or formalized within five days from the
close of the election proceedings.
Further, Section 14 of the same Rules provides that when a
protest has been perfected, only the med-arbiter can proclaim
and certify the winner. Clearly, this rule is based on the election
officers function, which is merely to conduct and supervise
certification elections.[13] It is the med-arbiter who is authorized to
Scroll No. 577
hear and decide representation cases.[14]Consequently, the
decision whether to certify the results of an election or to set them
aside due to incidents occurring during the campaign is within the
med-arbiters discretion.
Petitioner argues that the CA gravely erred in rendering its
assailed Decision, considering that no protest or challenge had
been formalized within five days, or raised during the election
proceedings and entered in the minutes thereof. Petitioner adds
that respondent did not file any protest, either, against the alleged
fraud and misrepresentation by the formers officers during the
election.
We disagree. When the med-arbiter admitted and gave due
course to respondents Petition for nullification of the election
proceedings, the election officer should have deferred issuing the
Certification of the results thereof. Section 13 of the Implementing
Rules cannot strictly be applied to the present case.
Respondents contention is that a number of employees were
lured by their officers into believing that petitioner was an
independent union. Since the employees had long desired to
have an independent union that would represent them in
collective bargaining, they voted yes in favor of petitioner. Having
been misled, a majority of them eventually disaffiliated
themselves from it and formed an independent union, respondent
herein, which thereafter protested the conduct of the
election. Having been formed just after such exercise by the
defrauded employees who were former members of petitioner,
respondent could not have reasonably filed its protest within five
days from the close of the election proceedings.
Notably, after it had applied for registration with the Bureau of
Labor Relations (BLR), respondent filed its Petition to nullify the
certification election. Petitioner insistently opposed the Petition,
as respondent had not yet been issued a certificate of registration
at the time. Because such certificate was issued in favor of the
latter four days after the filing of the Petition, on December 23,
1997, the misgivings of the former were brushed aside by the
med-arbiter. Indeed, the fact that respondent was not yet a duly
46|LabRel – Part IV-C
registered labor organization when the Petition was filed is of no
moment, absent any fatal defect in its application for registration.
The circumstances in the present case show that the
employees did not sleep on their rights. Hence, their failure to
follow strictly the procedural technicalities regarding the period for
filing their protest should not be taken against them. Mere
technicalities should not be allowed to prevail over the welfare of
the workers.[15] What is essential is that they be accorded an
opportunity to determine freely and intelligently which labor
organization shall act on their behalf.[16] Having been denied this
opportunity by the betrayal committed by petitioners officers in
the present case, the employees were prevented from making an
intelligent and independent choice.
False Statements of Union Officers
The making of false statements or misrepresentations that
interfere with the free choice of the employees is a valid ground
for protest. A certification election may be set aside for
misstatements made during the campaign, where 1) a material
fact has been misrepresented in the campaign; 2) an opportunity
for reply has been lacking; and 3) the misrepresentation has had
an impact on the free choice of the employees participating in the
election.[17] A misrepresentation is likely to have an impact on their
free choice, if it comes from a party who has special knowledge
or is in an authoritative position to know the true facts. This
principle holds true, especially when the employees are unable to
evaluate the truth or the falsity of the assertions.[18]
The fact that the officers of petitioner especially its president,
misrepresented it to the voting employees as an independent
union constituted a substantial misrepresentation of material facts
of vital concern to those employees. The materiality of such
misrepresentation is self-evident. The employees wanted an
independent union to represent them in collective bargaining, free
from outside interference. Thus, upon knowing that petitioner was
in fact an affiliate of the FFW, the members disaffiliated from
Scroll No. 577
petitioner and organized themselves into an independent union.
Additionally, the misrepresentation came from petitioners
recognized representative, who was clearly in a position to hold
himself out as a person who had special knowledge and was in
an authoritative position to know the true facts.
We are not easily persuaded by the argument of petitioner
that the employees had sufficient time between the
misrepresentation and the election to check the truth of its
claims. They could hardly be expected to verify the accuracy of
any statement regarding petitioner, made to them by its
officers. No less than its president stated that it was an
independent union. At the time, the employees had no reason to
doubt him.
We sustain the following findings of Med-Arbiter Falconitin:
x x x It must be noted at the outset that [respondent] has charged
[petitioners] officers, agents and representative with fraud or
deception in encouraging its members to form or join and vote
for DHL Philippines Corporation United Rank-and-File
Association which they represented as an independent labor
union not affiliated with any labor federation or national
union. Such serious allegations, supported with affidavits under
oath executed by no less than seven hundred four (704) DHL
Philippines Corporations employees nationwide, cannot just be
ignored.
xxxxxxxxx
Notwithstanding the fact that [petitioner] union was duly
furnished copy of the petition and the affidavits as its
attachments, it surprisingly failed to question, much less contest,
the veracity of the allegations contained in such affidavits, more
than just harping in general terms that the allegations are simply
incredible and [interposing] vehement denial. Being unassailed
and unrefuted, the allegations in the
47|LabRel – Part IV-C
affidavits which are considered as x x
x official documents must be given weight and consideration by
this Office. Furthermore, with the failure of [petitioner] to rebut
the affidavits, more than just denying the allegations, they give
rise to the presumption that [petitioner] has admitted such
allegations in the affidavit and with the admission, it is
inescapable that indeed there was fraud or machination
committed by the [petitioner] that seriously affected the validity
and legitimacy of the certification election conducted on
November 25, 1997 which gives rise to a ground to annul or
void the said election, having been marred by fraud, deceptions
and machinations. [19]
This finding of fact of a quasi-judicial agency of DOLE is
persuasive upon the courts.[20]
Although petitioner won in the election, it is now clear that it
does not represent the majority of the bargaining employees,
owing to the affiliation of its members with respondent. The
present uncertainty as to which union has their support to
represent them for collective bargaining purposes is a salient
factor that this Court has seriously considered.
The bargaining agent must be truly representative of the
employees.[21] At the time of the filing by respondent of the Petition
for nullification, allegiances and loyalties of the employees were
like shifting sands that radically affected their choice of an
appropriate bargaining representative. The polarization of a good
number of them followed their discovery of the fraud committed
by the officers of petitioner. At any rate, the claim that 704 of the
employees are affiliated with respondent is not sufficiently
rebutted by any evidence on record.
The purpose of a certification election is precisely to ascertain
the majority of the employees choice of an appropriate bargaining
unit -- to be or not to be represented by a labor organization and,
in the affirmative case, by which one.[22]
Scroll No. 577
Once disaffiliation has been demonstrated beyond doubt, a
certification election is the most expeditious way of determining
which union should be the exclusive bargaining representative of
the employees.[23]
WHEREFORE, the Petition is DENIED, and the assailed
Decision AFFIRMED. Costs against petitioner.
SO ORDERED.
Sandoval-Gutierrez, and Carpio-Morales, JJ., concur.
Corona, J., on leave.
G.R. No. 179146 July 23, 2013
HOLY CHILD CATHOLIC SCHOOL, Petitioner,
vs.
HON. PATRICIA STO. TOMAS, in her official capacity as
Secretary of the Department of Labor and Employment, and
PINAG-ISANG TINIG AT LAKAS NG ANAKPAWIS – HOLY
CHILD CATHOLIC SCHOOL TEACHERS AND EMPLOYEES
LABOR UNION (HCCS-TELU-PIGLAS), Respondents.
DECISION
PERALTA, J.:
Assailed in this petition for review on certiorari under Rule 45 of the
Rules of Civil Procedure are the April 18, 2007 Decision1 and July
31, 2007 Resolution2 of the Court of Appeals in CA-G.R. SP No.
76175, which affirmed the December 27, 2002 Decision3 and
February 13, 2003 Resolution4 of the Secretary of the Department of
Labor and Employment (SOLE) that set aside the August 10, 2002
Decision5 of the Med-Arbiter denying private respondent’s petition
for certification election.
48|LabRel – Part IV-C
The factual antecedents are as follows:
On May 31, 2002, a petition for certification election was filed by
private respondent Pinag-Isang Tinig at Lakas ng Anakpawis – Holy
Child Catholic School Teachers and Employees Labor Union
(HCCS-TELUPIGLAS), alleging that: PIGLAS is a legitimate labor
organization duly registered with the Department of Labor and
Employment (DOLE) representing HCCS-TELU-PIGLAS; HCCS is a
private educational institution duly registered and operating under
Philippine laws; there are approximately one hundred twenty (120)
teachers and employees comprising the proposed appropriate
bargaining unit; and HCCS is unorganized, there is no collective
bargaining agreement or a duly certified bargaining agent or a labor
organization certified as the sole and exclusive bargaining agent of
the proposed bargaining unit within one year prior to the filing of the
petition.6 Among the documents attached to the petition were the
certificate of affiliation with Pinag-Isang Tinig at Lakas ng Anakpawis
Kristiyanong Alyansa ng Makabayang Obrero (PIGLAS-KAMAO)
issued by the Bureau of Labor Relations (BLR), charter certificate
issued by PIGLASKAMAO, and certificate of registration of HCCS-
TELU as a legitimate labor organization issued by the DOLE.7
In its Comment8 and Position Paper,9 petitioner HCCS consistently
noted that it is a parochial school with a total of 156 employees as of
June 28, 2002, broken down as follows: ninety-eight (98) teaching
personnel, twenty-five (25) non-teaching academic employees, and
thirty-three (33) non-teaching non-academic workers. It averred that
of the employees who signed to support the petition, fourteen (14)
already resigned and six (6) signed twice. Petitioner raised that
members of private respondent do not belong to the same class; it is
not only a mixture of managerial, supervisory, and rank-and-file
employees – as three (3) are vice-principals, one (1) is a department
head/supervisor, and eleven (11) are coordinators – but also a
combination of teaching and non-teaching personnel – as twenty-
seven (27) are non-teaching personnel. It insisted that, for not being
in accord with Article 24510 of the Labor Code, private respondent is
an illegitimate labor organization lacking in personality to file a
petition for certification election, as held in Toyota Motor Philippines
Corporation v. Toyota Motor Philippines Corporation Labor
Union;11 and an inappropriate bargaining unit for want of community
Scroll No. 577
or mutuality of interest, as ruled in Dunlop Slazenger (Phils.), Inc. v.
Secretary of Labor and Employment12 and De La Salle University
Medical Center and College of Medicine v. Laguesma.13
Private respondent, however, countered that petitioner failed to
substantiate its claim that some of the employees included in the
petition for certification election holds managerial and supervisory
positions.14 Assuming it to be true, it argued that Section 11
(II),15 Rule XI of DOLE Department Order (D.O.) No. 9, Series of
1997, provided for specific instances in which a petition filed by a
legitimate organization shall be dismissed by the Med-Arbiter and
that "mixture of employees" is not one of those enumerated. Private
respondent pointed out that questions pertaining to qualifications of
employees may be threshed out in the inclusion-exclusion
proceedings prior to the conduct of the certification election,
pursuant to Section 2,16 Rule XII of D.O. No. 9. Lastly, similar to the
ruling in In Re: Globe Machine and Stamping Company,17 it
contended that the will of petitioner’s employees should be
respected as they had manifested their desire to be represented by
only one bargaining unit. To back up the formation of a single
employer unit, private respondent asserted that even if the teachers
may receive additional pay for an advisory class and for holding
additional loads, petitioner’s academic and non-academic personnel
have similar working conditions. It cited Laguna College v. Court of
Industrial Relations,18 as well as the case of a union in West Negros
College in Bacolod City, which allegedly represented both academic
and non-academic employees.
On August 10, 2002, Med-Arbiter Agatha Ann L. Daquigan denied
the petition for certification election on the ground that the unit which
private respondent sought to represent is inappropriate. She
resolved:
A certification election proceeding directly involves two (2) issues
namely: (a) the proper composition and constituency of the
bargaining unit; and (b) the validity of majority representation claims.
It is therefore incumbent upon the Med-Arbiter to rule on the
appropriateness of the bargaining unit once its composition and
constituency is questioned.
49|LabRel – Part IV-C
Section 1 (q), Rule I, Book V of the Omnibus Rules defines a
"bargaining unit" as a group of employees sharing mutual interests
within a given employer unit comprised of all or less than all of the
entire body of employees in the employer unit or any specific
occupational or geographical grouping within such employer unit.
This definition has provided the "community or mutuality of interest"
test as the standard in determining the constituency of a collective
bargaining unit. This is so because the basic test of an asserted
bargaining unit’s acceptability is whether or not it is fundamentally
the combination which will best assure to all employees the exercise
of their collective bargaining rights. The application of this test may
either result in the formation of an employer unit or in the
fragmentation of an employer unit.
In the case at bar, the employees of petitioner, may, as already
suggested, quite easily be categorized into (2) general classes: one,
the teaching staff; and two, the non-teaching-staff. Not much
reflection is needed to perceive that the community or mutuality of
interest is wanting between the teaching and the non-teaching staff.
It would seem obvious that the teaching staff would find very little in
common with the non-teaching staff as regards responsibilities and
function, working conditions, compensation rates, social life and
interests, skills and intellectual pursuits, etc. These are plain and
patent realities which cannot be ignored. These dictate the
separation of these two categories of employees for purposes of
collective bargaining. (University of the Philippines vs. Ferrer-
Calleja, 211 SCRA 451)19
Private respondent appealed before the SOLE, who, on December
27, 2002, ruled against the dismissal of the petition and directed the
conduct of two separate certification elections for the teaching and
the non-teaching personnel, thus:
We agree with the Med-Arbiter that there are differences in the
nature of work, hours and conditions of work and salary
determination between the teaching and non-teaching personnel of
petitioner. These differences were pointed out by petitioner in its
position paper. We do not, however, agree with the Med-Arbiter that
these differences are substantial enough to warrant the dismissal of
the petition. First, as pointed out by private respondent,
Scroll No. 577
"inappropriateness of the bargaining unit sought to be represented is
not a ground for the dismissal of the petition." In fact, in the cited
case of University of the Philippines v. Ferrer-Calleja, supra, the
Supreme Court did not order the dismissal of the petition but
ordered the conduct of a certification election, limiting the same
among the non-academic personnel of the University of the
Philippines.
It will be recalled that in the U.P. case, there were two contending
unions, the Organization of Non-Academic Personnel of U.P.
(ONAPUP) and All U.P. Workers Union composed of both academic
and nonacademic personnel of U.P. ONAPUP sought the conduct of
certification election among the rank-and-file non-academic
personnel only while the all U.P. Workers Union sought the conduct
of certification election among all of U.P.’s rank-and-file employees
covering academic and nonacademic personnel. While the Supreme
Court ordered a separate bargaining unit for the U.P. academic
personnel, the Court, however, did not order them to organize a
separate labor organization among themselves. The All U.P.
Workers Union was not directed to divest itself of its academic
personnel members and in fact, we take administrative notice that
the All U.P. Workers Union continue to exist with a combined
membership of U.P. academic and non-academic personnel
although separate bargaining agreements is sought for the two
bargaining units. Corollary, private respondent can continue to exist
as a legitimate labor organization with the combined teaching and
non-teaching personnel in its membership and representing both
classes of employees in separate bargaining negotiations and
agreements.
WHEREFORE, the Decision of the Med-Arbiter dated 10 August
2002 is hereby REVERSED and SET ASIDE. In lieu thereof, a new
order is hereby issued directing the conduct of two certification
elections, one among the non-teaching personnel of Holy Child
Catholic School, and the other, among the teaching personnel of the
same school, subject to the usual pre-election conferences and
inclusion-exclusion proceedings, with the following choices:
A. Certification Election Among Petitioner’s Teaching
Personnel:
50|LabRel – Part IV-C
 1. Holy Child Catholic School Teachers and
Employees Labor Union; and
2. No Union.
B. Certification Election Among Petitioner’s Non-Teaching
Personnel:
1. Holy Child Catholic School Teachers and
Employees Labor Union; and
2. No Union.
Petitioner is hereby directed to submit to the Regional Office of
origin within ten (10) days from receipt of this Decision, a certified
separate list of its teaching and non-teaching personnel or when
necessary a separate copy of their payroll for the last three (3)
months prior to the issuance of this Decision.20
Petitioner filed a motion for reconsideration21 which, per Resolution
dated February 13, 2003, was denied. Consequently, petitioner filed
before the CA a Petition for Certiorari with Prayer for Temporary
Restraining Order and Preliminary Injunction.22 The CA resolved to
defer action on the prayer for TRO pending the filing of private
respondent’s Comment.23 Later, private respondent and petitioner
filed their Comment24 and Reply,25respectively.
On July 23, 2003, petitioner filed a motion for immediate issuance of
a TRO, alleging that Hon. Helen F. Dacanay of the Industrial
Relations Division of the DOLE was set to implement the SOLE
Decision when it received a summons and was directed to submit a
certified list of teaching and non-teaching personnel for the last three
months prior to the issuance of the assailed Decision.26 Acting
thereon, on August 5, 2003, the CA issued the TRO and ordered
private respondent to show cause why the writ of preliminary
injunction should not be granted.27 Subsequently, a Manifestation
and Motion28 was filed by private respondent, stating that it repleads
by reference the arguments raised in its Comment and that it prays
for the immediate lifting of the TRO and the denial of the preliminary
injunction. The CA, however, denied the manifestation and motion
Scroll No. 577
on November 21, 200329 and, upon motion of petitioner,30 granted
the preliminary injunction on April 21, 2005.31 Thereafter, both
parties filed their respective Memorandum.32
On April 18, 2007, the CA eventually dismissed the petition. As to
the purported commingling of managerial, supervisory, and rank-
and-file employees in private respondent’s membership, it held that
the Toyota ruling is inapplicable because the vice-principals,
department head, and coordinators are neither supervisory nor
managerial employees. It reasoned:
x x x While it may be true that they wield power over other
subordinate employees of the petitioner, it must be stressed,
however, that their functions are not confined with policy-
determining such as hiring, firing, and disciplining of employees,
salaries, teaching/working hours, other monetary and non-monetary
benefits, and other terms and conditions of employment. Further,
while they may formulate policies or guidelines, nonetheless, such is
merely recommendatory in nature, and still subject to review and
evaluation by the higher executives, i.e., the principals or executive
officers of the petitioner. It cannot also be denied that in institutions
like the petitioner, company policies have already been pre-
formulated by the higher executives and all that the mentioned
employees have to do is carry out these company policies and
standards. Such being the case, it is crystal clear that there is no
improper commingling of members in the private respondent union
as to preclude its petition for certification of (sic) election.33
Anent the alleged mixture of teaching and non-teaching personnel,
the CA agreed with petitioner that the nature of the former’s work
does not coincide with that of the latter. Nevertheless, it ruled that
the SOLE did not commit grave abuse of discretion in not dismissing
the petition for certification election, since it directed the conduct of
two separate certification elections based on Our ruling in University
of the Philippines v. Ferrer-Calleja.34
A motion for reconsideration35 was filed by petitioner, but the CA
denied the same;36 hence, this petition assigning the alleged errors
as follows:
51|LabRel – Part IV-C
 I.
THE HONORABLE COURT OF APPEALS ERRED IN HOLDING
THAT THE RULING IN THE CASE OF TOYOTA MOTOR
PHILIPPINES CORPORATION VS. TOYOTA MOTOR
PHILIPPINES CORPORATION LABOR UNION (268 SCRA 573)
DOES NOT APPLY IN THE CASE AT BAR DESPITE THE
[COMMINGLING] OF BOTH SUPERVISORY OR MANAGERIAL
AND RANK-AND-FILE EMPLOYEES IN THE RESPONDENT
UNION;
II
THE HONORABLE COURT OF APPEALS ERRED IN ITS
CONFLICTING RULING ALLOWING THE CONDUCT OF
CERTIFICATION ELECTION BY UPHOLDING THAT THE
RESPONDENT UNION REPRESENTED A BARGAINING UNIT
DESPITE ITS OWN FINDINGS THAT THERE IS NO MUTUALITY
OF INTEREST BETWEEN THE MEMBERS OF RESPONDENT
UNION APPLYING THE TEST LAID DOWN IN THE CASE OF
UNIVERSITY OF THE PHILIPPINES VS. FERRER-CALLEJA (211
SCRA 451).37
We deny.
Petitioner claims that the CA contradicted the very definition of
managerial and supervisory employees under existing law and
jurisprudence when it did not classify the vice-principals, department
head, and coordinators as managerial or supervisory employees
merely because the policies and guidelines they formulate are still
subject to the review and evaluation of the principal or executive
officers of petitioner. It points out that the duties of the vice-
principals, department head, and coordinators include the evaluation
and assessment of the effectiveness and capability of the teachers
under them; that such evaluation and assessment is independently
made without the participation of the higher Administration of
petitioner; that the fact that their recommendation undergoes the
approval of the higher Administration does not take away the
independent nature of their judgment; and that it would be difficult
for the vice-principals, department head, and coordinators to
Scroll No. 577
objectively assess and evaluate the performances of teachers under
them if they would be allowed to be members of the same labor
union.
On the other hand, aside from reiterating its previous submissions,
private respondent cites Sections 9 and 1238of Republic Act (R.A.)
No. 9481 to buttress its contention that petitioner has no standing to
oppose the petition for certification election. On the basis of the
statutory provisions, it reasons that an employer is not a party-in-
interest in a certification election; thus, petitioner does not have the
requisite right to protect even by way of restraining order or
injunction.
First off, We cannot agree with private respondent’s invocation of
R.A. No. 9481. Said law took effect only on June 14, 2007; hence,
its applicability is limited to labor representation cases filed on or
after said date.39 Instead, the law and rules in force at the time
private respondent filed its petition for certification election on May
31, 2002 are R.A. No. 6715, which amended Book V of Presidential
Decree (P.D.) No. 442 (the Labor Code), as amended, and the
Rules and Regulations Implementing R.A. No. 6715, as amended by
D.O. No. 9, which was dated May 1, 1997 but took effect on June
21, 1997.40
However, note must be taken that even without the express
provision of Section 12 of RA No. 9481, the "Bystander Rule" is
already well entrenched in this jurisdiction. It has been consistently
held in a number of cases that a certification election is the sole
concern of the workers, except when the employer itself has to file
the petition pursuant to Article 259 of the Labor Code, as amended,
but even after such filing its role in the certification process ceases
and becomes merely a bystander.41 The employer clearly lacks the
personality to dispute the election and has no right to interfere at all
therein.42 This is so since any uncalled-for concern on the part of the
employer may give rise to the suspicion that it is batting for a
company union.43 Indeed, the demand of the law and policy for an
employer to take a strict, hands-off stance in certification elections is
based on the rationale that the employees’ bargaining
representative should be chosen free from any extraneous influence
of the management; that, to be effective, the bargaining
52|LabRel – Part IV-C
representative must owe its loyalty to the employees alone and to no
other.44
Now, going back to petitioner’s contention, the issue of whether a
petition for certification election is dismissible on the ground that the
labor organization’s membership allegedly consists of supervisory
and rank-and-file employees is actually not a novel one. In the 2008
case of Republic v. Kawashima Textile Mfg., Philippines,
Inc.,45wherein the employer-company moved to dismiss the petition
for certification election on the ground inter alia that the union
membership is a mixture of rank-and-file and supervisory
employees, this Court had conscientiously discussed the
applicability of Toyota and Dunlop in the context of R.A. No. 6715
and D.O. No. 9, viz.:
It was in R.A. No. 875, under Section 3, that such questioned
mingling was first prohibited, to wit:
Sec. 3. Employees' right to self-organization. - Employees shall
have the right to self-organization and to form, join or assist labor
organizations of their own choosing for the purpose of collective
bargaining through representatives of their own choosing and to
engage in concerted activities for the purpose of collective
bargaining and other mutual aid or protection. Individuals employed
as supervisors shall not be eligible for membership in a labor
organization of employees under their supervision but may form
separate organizations of their own. (Emphasis supplied)
Nothing in R.A. No. 875, however, tells of how the questioned
mingling can affect the legitimacy of the labor organization. Under
Section 15, the only instance when a labor organization loses its
legitimacy is when it violates its duty to bargain collectively; but there
is no word on whether such mingling would also result in loss of
legitimacy. Thus, when the issue of whether the membership of two
supervisory employees impairs the legitimacy of a rank-and-file
labor organization came before the Court En Banc in Lopez v.
Chronicle Publication Employees Association, the majority
pronounced:
Scroll No. 577
It may be observed that nothing is said of the effect of such
ineligibility upon the union itself or on the status of the other qualified
members thereof should such prohibition be disregarded.
Considering that the law is specific where it intends to divest a
legitimate labor union of any of the rights and privileges granted to it
by law, the absence of any provision on the effect of the
disqualification of one of its organizers upon the legality of the union,
may be construed to confine the effect of such ineligibility only upon
the membership of the supervisor. In other words, the invalidity of
membership of one of the organizers does not make the union
illegal, where the requirements of the law for the organization
thereof are, nevertheless, satisfied and met. (Emphasis supplied)
Then the Labor Code was enacted in 1974 without reproducing Sec.
3 of R.A. No. 875. The provision in the Labor Code closest to Sec. 3
is Article 290, which is deafeningly silent on the prohibition against
supervisory employees mingling with rank-and-file employees in one
labor organization. Even the Omnibus Rules Implementing Book V
of the Labor Code (Omnibus Rules) merely provides in Section 11,
Rule II, thus:
Sec. 11. Supervisory unions and unions of security guards to cease
operation. - All existing supervisory unions and unions of security
guards shall, upon the effectivity of the Code, cease to operate as
such and their registration certificates shall be deemed automatically
cancelled. However, existing collective agreements with such
unions, the life of which extends beyond the date of effectivity of the
Code shall be respected until their expiry date insofar as the
economic benefits granted therein are concerned.
Members of supervisory unions who do not fall within the definition
of managerial employees shall become eligible to join or assist the
rank and file organization. The determination of who are managerial
employees and who are not shall be the subject of negotiation
between representatives of supervisory union and the employer. If
no agreement s reached between the parties, either or both of them
may bring the issue to the nearest Regional Office for determination.
(Emphasis supplied)
53|LabRel – Part IV-C
The obvious repeal of the last clause of Sec. 3, R.A. No. 875
prompted the Court to declare in Bulletin v. Sanchez that
supervisory employees who do not fall under the category of
managerial employees may join or assist in the formation of a labor
organization for rank-and-file employees, but they may not form their
own labor organization.
While amending certain provisions of Book V of the Labor Code,
E.O. No. 111 and its implementing rules continued to recognize the
right of supervisory employees, who do not fall under the category of
managerial employees, to join a rank- and-file labor organization.
Effective 1989, R.A. No. 6715 restored the prohibition against the
questioned mingling in one labor organization, viz.:
Sec. 18. Article 245 of the same Code, as amended, is hereby
further amended to read as follows:
Art. 245. Ineligibility of managerial employees to join any labor
organization; right of supervisory employees. Managerial employees
are not eligible to join, assist or form any labor organization.
Supervisory employees shall not be eligible for membership in a
labor organization of the rank-and-file employees but may join,
assist or form separate labor organizations of their own (Emphasis
supplied)
Unfortunately, just like R.A. No. 875, R.A. No. 6715 omitted
specifying the exact effect any violation of the prohibition would
bring about on the legitimacy of a labor organization.
It was the Rules and Regulations Implementing R.A. No. 6715 (1989
Amended Omnibus Rules) which supplied the deficiency by
introducing the following amendment to Rule II (Registration of
Unions):
Sec. 1. Who may join unions. - x x x Supervisory employees and
security guards shall not be eligible for membership in a labor
organization of the rank-and-file employees but may join, assist or
form separate labor organizations of their own; Provided, that those
supervisory employees who are included in an existing rank-and-file
Scroll No. 577
bargaining unit, upon the effectivity of Republic Act No. 6715, shall
remain in that unit x x x. (Emphasis supplied)
and Rule V (Representation Cases and Internal-Union Conflicts) of
the Omnibus Rules, viz.;
Sec. 1. Where to file. - A petition for certification election may be
filed with the Regional Office which has jurisdiction over the principal
office of the employer. The petition shall be in writing and under
oath.
Sec. 2. Who may file. - Any legitimate labor organization or the
employer, when requested to bargain collectively, may file the
petition.
The petition, when filed by a legitimate labor organization, shall
contain, among others:
xxxx
(c) description of the bargaining unit which shall be the employer
unit unless circumstances otherwise require; and provided further,
that the appropriate bargaining unit of the rank-and-file employees
shall not include supervisory employees and/or security guards.
(Emphasis supplied)
By that provision, any questioned mingling will prevent an otherwise
legitimate and duly registered labor organization from exercising its
right to file a petition for certification election.
Thus, when the issue of the effect of mingling was brought to the
fore in Toyota, the Court, citing Article 245 of the Labor Code, as
amended by R.A. No. 6715, held:
Clearly, based on this provision, a labor organization composed of
both rank-and-file and supervisory employees is no labor
organization at all. It cannot, for any guise or purpose, be a
legitimate labor organization. Not being one, an organization which
carries a mixture of rank-and-file and supervisory employees cannot
possess any of the rights of a legitimate labor organization, including
54|LabRel – Part IV-C
the right to file a petition for certification election for the purpose of
collective bargaining. It becomes necessary, therefore, anterior to
the granting of an order allowing a certification election, to inquire
into the composition of any labor organization whenever the status
of the labor organization is challenged on the basis of Article 245 of
the Labor Code.
xxxx
In the case at bar, as respondent union's membership list contains
the names of at least twenty-seven (27) supervisory employees in
Level Five positions, the union could not, prior to purging itself of its
supervisory employee members, attain the status of a legitimate
labor organization. Not being one, it cannot possess the requisite
personality to file a petition for certification election. (Emphasis
supplied)
In Dunlop, in which the labor organization that filed a petition for
certification election was one for supervisory employees, but in
which the membership included rank-and-file employees, the Court
reiterated that such labor organization had no legal right to file a
certification election to represent a bargaining unit composed of
supervisors for as long as it counted rank-and-file employees among
its members.
It should be emphasized that the petitions for certification election
involved in Toyota and Dunlop were filed on November 26, 1992
and September 15, 1995, respectively; hence, the 1989 Rules was
applied in both cases.
But then, on June 21, 1997, the 1989 Amended Omnibus Rules was
further amended by Department Order No. 9, series of 1997 (1997
Amended Omnibus Rules). Specifically, the requirement under Sec.
2(c) of the 1989 Amended Omnibus Rules - that the petition for
certification election indicate that the bargaining unit of rank-and-file
employees has not been mingled with supervisory employees - was
removed. Instead, what the 1997 Amended Omnibus Rules requires
is a plain description of the bargaining unit, thus:
Scroll No. 577
Rule XI
Certification Elections
xxxx
Sec. 4. Forms and contents of petition. - The petition shall be in
writing and under oath and shall contain, among others, the
following: x x x (c) The description of the bargaining unit."
In Pagpalain Haulers, Inc. v. Trajano, the Court had occasion to
uphold the validity of the 1997 Amended Omnibus Rules, although
the specific provision involved therein was only Sec. 1, Rule VI, to
wit:
Sec. 1. Chartering and creation of a local/chapter.- A duly registered
federation or national union may directly create a local/chapter by
submitting to the Regional Office or to the Bureau two (2) copies of
the following: a) a charter certificate issued by the federation or
national union indicating the creation or establishment of the
local/chapter; (b) the names of the local/chapter's officers, their
addresses, and the principal office of the local/chapter; and (c) the
local/ chapter's constitution and by-laws; provided that where the
local/chapter's constitution and by-laws is the same as that of the
federation or national union, this fact shall be indicated accordingly.
All the foregoing supporting requirements shall be certified under
oath by the Secretary or the Treasurer of the local/chapter and
attested to by its President.
which does not require that, for its creation and registration, a local
or chapter submit a list of its members.
Then came Tagaytay Highlands Int'l. Golf Club, Inc. v. Tagaytay
Highlands Employees Union-PTGWO in which the core issue was
whether mingling affects the legitimacy of a labor organization and
its right to file a petition for certification election. This time, given the
altered legal milieu, the Court abandoned the view in Toyota and
Dunlop and reverted to its pronouncement in Lopez that while there
is a prohibition against the mingling of supervisory and rank-and-file
employees in one labor organization, the Labor Code does not
55|LabRel – Part IV-C
provide for the effects thereof. Thus, the Court held that after a labor
organization has been registered, it may exercise all the rights and
privileges of a legitimate labor organization. Any mingling between
supervisory and rank-and-file employees in its membership cannot
affect its legitimacy for that is not among the grounds for
cancellation of its registration, unless such mingling was brought
about by misrepresentation, false statement or fraud under Article
239 of the Labor Code.
In San Miguel Corp. (Mandaue Packaging Products Plants) v.
Mandaue Packing Products Plants-San Miguel Packaging Products-
San Miguel Corp. Monthlies Rank-and-File Union-FFW, the Court
explained that since the 1997 Amended Omnibus Rules does not
require a local or chapter to provide a list of its members, it would be
improper for the DOLE to deny recognition to said local or chapter
on account of any question pertaining to its individual members.
More to the point is Air Philippines Corporation v. Bureau of Labor
Relations, which involved a petition for cancellation of union
registration filed by the employer in 1999 against a rank-and-file
labor organization on the ground of mixed membership: the Court
therein reiterated its ruling in Tagaytay Highlands that the inclusion
in a union of disqualified employees is not among the grounds for
cancellation, unless such inclusion is due to misrepresentation, false
statement or fraud under the circumstances enumerated in Sections
(a) and (c) of Article 239 of the Labor Code.
All said, while the latest issuance is R.A. No. 9481, the 1997
Amended Omnibus Rules, as interpreted by the Court in Tagaytay
Highlands, San Miguel and Air Philippines, had already set the tone
for it. Toyota and Dunlop no longer hold sway in the present altered
state of the law and the rules.46
When a similar issue confronted this Court close to three years later,
the above ruling was substantially quoted in Samahang
Manggagawa sa Charter Chemical Solidarity of Unions in the
Philippines for Empowerment and Reforms (SMCC-Super) v.
Charter Chemical and Coating Corporation.47 In unequivocal terms,
We reiterated that the alleged inclusionof supervisory employees in
a labor organization seeking to represent the bargaining unit of rank-
Scroll No. 577
and-file employees does not divest it of its status as a legitimate
labor organization.48
Indeed, Toyota and Dunlop no longer hold true under the law and
rules governing the instant case. The petitions for certification
election involved in Toyota and Dunlop were filed on November 26,
1992 and September 15, 1995, respectively; hence, the 1989 Rules
and Regulations Implementing R.A. No. 6715 (1989 Amended
Omnibus Rules) was applied. In contrast, D.O. No. 9 is applicable in
the petition for certification election of private respondent as it was
filed on May 31, 2002.
Following the doctrine laid down in Kawashima and SMCC-Super, it
must be stressed that petitioner cannot collaterally attack the
legitimacy of private respondent by praying for the dismissal of the
petition for certification election:
Except when it is requested to bargain collectively, an employer is a
mere bystander to any petition for certification election; such
proceeding is non-adversarial and merely investigative, for the
purpose thereof is to determine which organization will represent the
employees in their collective bargaining with the employer. The
choice of their representative is the exclusive concern of the
employees; the employer cannot have any partisan interest therein;
it cannot interfere with, much less oppose, the process by filing a
motion to dismiss or an appeal from it; not even a mere allegation
that some employees participating in a petition for certification
election are actually managerial employees will lend an employer
legal personality to block the certification election. The employer's
only right in the proceeding is to be notified or informed thereof.
The amendments to the Labor Code and its implementing rules
have buttressed that policy even more.49
Further, the determination of whether union membership comprises
managerial and/or supervisory employees is a factual issue that is
best left for resolution in the inclusion-exclusion proceedings, which
has not yet happened in this case so still premature to pass upon.
We could only emphasize the rule that factual findings of labor
officials, who are deemed to have acquired expertise in matters
56|LabRel – Part IV-C
within their jurisdiction, are generally accorded not only with respect
but even finality by the courts when supported by substantial
evidence.50 Also, the jurisdiction of this Court in cases brought
before it from the CA via Rule 45 is generally limited to reviewing
errors of law or jurisdiction. The findings of fact of the CA are
conclusive and binding. Except in certain recognized instances,51We
do not entertain factual issues as it is not Our function to analyze or
weigh evidence all over again; the evaluation of facts is best left to
the lower courts and administrative agencies/quasi-judicial bodies
which are better equipped for the task.52
Turning now to the second and last issue, petitioner argues that, in
view of the improper mixture of teaching and non-teaching
personnel in private respondent due to the absence of mutuality of
interest among its members, the petition for certification election
should have been dismissed on the ground that private respondent
is not qualified to file such petition for its failure to qualify as a
legitimate labor organization, the basic qualification of which is the
representation of an appropriate bargaining unit.
We disagree.
The concepts of a union and of a legitimate labor organization are
different from, but related to, the concept of a bargaining unit:
Article 212(g) of the Labor Code defines a labor organization as
"any union or association of employees which exists in whole or in
part for the purpose of collective bargaining or of dealing with
employers concerning terms and conditions of employment." Upon
compliance with all the documentary requirements, the Regional
Office or Bureau shall issue in favor of the applicant labor
organization a certificate indicating that it is included in the roster of
legitimate labor organizations. Any applicant labor organization shall
acquire legal personality and shall be entitled to the rights and
privileges granted by law to legitimate labor organizations upon
issuance of the certificate of registration.53
In case of alleged inclusion of disqualified employees in a union, the
proper procedure for an employer like petitioner is to directly file a
petition for cancellation of the union’s certificate of registration due
Scroll No. 577
to misrepresentation, false statement or fraud under the
circumstances enumerated in Article 239 of the Labor Code, as
amended.54 To reiterate, private respondent, having been validly
issued a certificate of registration, should be considered as having
acquired juridical personality which may not be attacked collaterally.
On the other hand, a bargaining unit has been defined as a "group
of employees of a given employer, comprised of all or less than all of
the entire body of employees, which the collective interests of all the
employees, consistent with equity to the employer, indicated to be
best suited to serve reciprocal rights and duties of the parties under
the collective bargaining provisions of the law." 55 In determining the
proper collective bargaining unit and what unit would be appropriate
to be the collective bargaining agency, the Court, in the seminal
case of Democratic Labor Association v. Cebu Stevedoring
Company, Inc.,56 mentioned several factors that should be
considered, to wit: (1) will of employees (Globe Doctrine); (2) affinity
and unity of employees' interest, such as substantial similarity of
work and duties, or similarity of compensation and working
conditions; (3) prior collective bargaining history; and (4)
employment status, such as temporary, seasonal and probationary
employees. We stressed, however, that the test of the grouping is
community or mutuality of interest, because "the basic test of an
asserted bargaining unit's acceptability is whether or not it is
fundamentally the combination which will best assure to all
employees the exercise of their collective bargaining rights."57
As the SOLE correctly observed, petitioner failed to comprehend the
full import of Our ruling in U.P. It suffices to quote with approval the
apt disposition of the SOLE when she denied petitioner’s motion for
reconsideration:
Petitioner likewise claimed that we erred in interpreting the decision
of the Supreme Court in U.P. v. Ferrer-Calleja, supra. According to
petitioner, the Supreme Court stated that the non-academic rank-
andfile employees of the University of the Philippines shall constitute
a bargaining unit to the exclusion of the academic employees of the
institution. Hence, petitioner argues, it sought the creation of
separate bargaining units, namely: (1) petitioner’s teaching
personnel to the exclusion of non-teaching personnel; and (2)
57|LabRel – Part IV-C
petitioner’s non-teaching personnel to the exclusion of teaching
personnel.
Petitioner appears to have confused the concepts of membership in
a bargaining unit and membership in a union. In emphasizing the
phrase "to the exclusion of academic employees" stated in U.P. v.
Ferrer-Calleja, petitioner believed that the petitioning union could not
admit academic employees of the university to its membership. But
such was not the intention of the Supreme Court.
A bargaining unit is a group of employees sought to be represented
by a petitioning union. Such employees need not be members of a
union seeking the conduct of a certification election. A union certified
as an exclusive bargaining agent represents not only its members
but also other employees who are not union members. As pointed
out in our assailed Decision, there were two contending unions in
the U.P. case, namely, the Organization of Non-Academic
Personnel of U.P. (ONAPUP) and the All U.P. Worker’s Union
composed of both U.P. academic and non-academic personnel.
ONAPUP sought the conduct of a certification election among the
rank-and-file non-academic personnel only, while the All U.P.
Workers Union intended to cover all U.P. rank-and-file employees,
involving both academic and non-academic personnel.
The Supreme Court ordered the "non-academic rank-and-file
employees of U.P. to constitute a bargaining unit to the exclusion of
the academic employees of the institution", but did not order them to
organize a separate labor organization. In the U.P. case, the
Supreme Court did not dismiss the petition and affirmed the order
for the conduct of a certification election among the non-academic
personnel of U.P., without prejudice to the right of the academic
personnel to constitute a separate bargaining unit for themselves
and for the All U.P. Workers Union to institute a petition for
certification election.
In the same manner, the teaching and non-teaching personnel of
petitioner school must form separate bargaining units. Thus, the
1âw phi1
order for the conduct of two separate certification elections, one
involving teaching personnel and the other involving non-teaching
personnel. It should be stressed that in the subject petition, private
Scroll No. 577
respondent union sought the conduct of a certification election
among all the rank-and-file personnel of petitioner school. Since the
decision of the Supreme Court in the U.P. case prohibits us from
commingling teaching and non-teaching personnel in one bargaining
unit, they have to be separated into two separate bargaining units
with two separate certification elections to determine whether the
employees in the respective bargaining units desired to be
represented by private respondent. In the U.P. case, only one
certification election among the non-academic personnel was
ordered, because ONAPUP sought to represent that bargaining unit
only. No petition for certification election among the academic
personnel was instituted by All U.P. Workers Union in the said case;
thus, no certification election pertaining to its intended bargaining
unit was ordered by the Court.58
Indeed, the purpose of a certification election is precisely to
ascertain the majority of the employees’ choice of an appropriate
bargaining unit – to be or not to be represented by a labor
organization and, if in the affirmative case, by which one.59
At this point, it is not amiss to stress once more that, as a rule, only
questions of law may be raised in a Rule 45 petition. In Montoya v.
Transmed Manila Corporation,60 the Court discussed the particular
parameters of a Rule 45 appeal from the CA’s Rule 65 decision on a
labor case, as follows:
x x x In a Rule 45 review, we consider the correctness of the
assailed CA decision, in contrast with the review for jurisdictional
error that we undertake under Rule 65. Furthermore, Rule 45 limits
us to the review of questions of law raised against the assailed CA
decision. In ruling for legal correctness, we have to view the CA
decision in the same context that the petition for certiorari it ruled
upon was presented to it; we have to examine the CA decision from
the prism of whether it correctly determined the presence or
absence of grave abuse of discretion in the NLRC decision before it,
not on the basis of whether the NLRC decision on the merits of the
case was correct. In other words, we have to be keenly aware that
the CA undertook a Rule 65 review, not a review on appeal, of the
NLRC decision challenged before it. This is the approach that
should be basic in a Rule 45 review of a CA ruling in a labor case. In
58|LabRel – Part IV-C
question form, the question to ask is: Did the CA correctly determine STA. LUCIA EAST G.R. No. 162355
whether the NLRC committed grave abuse of discretion in ruling on COMMERCIAL
the case?61
CORPORATION,
Our review is, therefore, limited to the determination of whether the Petitioner, Present:
CA correctly resolved the presence or absence of grave abuse of
discretion in the decision of the SOLE, not on the basis of whether - versus - PUNO, C.J., Chairperson,
the latter's decision on the merits of the case was strictly correct. CARPIO,
Whether the CA committed grave abuse of discretion is not what is CORONA,
ruled upon but whether it correctly determined the existence or want *
of grave abuse of discretion on the part of the SOLE. HON. SECRETARY OF CHICO-NAZARIO, and
LABOR AND LEONARDO-DE
WHEREFORE, the pet1t1on is DENIED. The April 18, 2007 EMPLOYMENT and CASTRO, JJ.
Decision and July 31, 2007, Resolution of the Court of Appeals in STA. LUCIA EAST
CA-G.R. SP No. 76175, which affirmed the December 27, 2002
Decision of the Secretary of the Department of Labor and COMMERCIAL
Employment that set aside the CORPORATION WORKERS Promulgated:
ASSOCIATION (CLUP
August 10, 2002 Decision of the Med-Arbiter denying private LOCAL CHAPTER), August 14, 2009
respondent's petition for certification election are hereby Respondents.
AFFIRMED.
x-----------------------------------------
SO ORDERED. ---------x

DECISION

CARPIO, J.:

The Case

This is a petition for review[1]assailing the

Decision[2]promulgated on 14 August 2003 as well as the
Resolution[3]promulgated on 24 February 2004 of the Court of
Appeals (appellate court) in CA-G.R. SP No. 77015. The

Scroll No. 577 59|LabRel – Part IV-C

appellate court denied Sta. Lucia East Commercial
Corporations (SLECC) petition for certiorari with prayer for
writ of preliminary injunction and temporary restraining
order. The appellate court further ruled that the Secretary of
Labor and Employment (Secretary) was correct when she
held that the subsequent negotiations and registration of a
collective bargaining agreement (CBA) executed by SLECC
with Samahang Manggagawa sa Sta. Lucia East Commercial
(SMSLEC) could not bar Sta. Lucia East Commercial
Corporation Workers Associations (SLECCWA) petition for
direct certification.
The Facts
The Secretary narrated the facts as follows:
On 27 February 2001, Confederated Labor Union
of the Philippines (CLUP), in behalf of its
chartered local, instituted a petition for
certification election among the regular rank-and-
file employees of Sta. Lucia East Commercial
Corporation and its Affiliates, docketed as Case
No. RO400-0202-RU-007. The affiliate companies
included in the petition were SLE Commercial,
SLE Department Store, SLE Cinema, Robsan East
Trading, Bowling Center, Planet Toys, Home
Gallery and Essentials.
On 21 August 2001, Med-Arbiter Bactin ordered
the dismissal of the petition due to
Scroll No. 577
inappropriateness of the bargaining unit. CLUP-
Sta. Lucia East Commercial Corporation and its
Affiliates Workers Union appealed the order of
dismissal to this Office on 14 September 2001. On
20 November 2001, CLUP-Sta. Lucia East
Commercial Corporation and its Affiliates
Workers Union [CLUP-SLECC and its Affiliates
Workers Union] moved for the withdrawal of the
appeal. On 31 January 2002, this Office granted
the motion and affirmed the dismissal of the
petition.
In the meantime, on 10 October 2001, [CLUP-
SLECC and its Affiliates Workers Union]
reorganized itself and re-registered as CLUP-Sta.
Lucia East Commercial Corporation Workers
Association (herein appellant CLUP-SLECCWA),
limiting its membership to the rank-and-file
employees of Sta. Lucia East Commercial
Corporation. It was issued Certificate of Creation
of a Local Chapter No. RO400-0110-CC-004.
On the same date, [CLUP-SLECCWA] filed the
instant petition. It alleged that [SLECC] employs
about 115 employees and that more than 20% of
employees belonging to the rank-and-file category
are its members. [CLUP-SLECCWA] claimed that
no certification election has been held among them
within the last 12 months prior to the filing of the
petition, and while there is another union
registered with DOLE-Regional Office No. IV on
22 June 2001 covering the same employees,
namely [SMSLEC], it has not been recognized as
60|LabRel – Part IV-C
the exclusive bargaining agent of [SLECCs]
employees.
On 22 November 2001, SLECC filed a motion to
dismiss the petition. It averred that it has
voluntarily recognized [SMSLEC] on 20 July 2001
as the exclusive bargaining agent of its regular
rank-and-file employees, and that collective
bargaining negotiations already commenced
between them. SLECC argued that the petition
should be dismissed for violating the one year and
negotiation bar rules under pars. (c) and (d),
Section 11, Rule XI, Book V of the Omnibus
Rules Implementing the Labor Code.
On 29 November 2001, a CBA between
[SMSLEC] and [SLECC] was ratified by its rank-
and-file employees and registered with DOLE-
Regional Office No. IV on 9 January 2002.
In the meantime, on 19 December 2001, [CLUP-
SLECCWA] filed its Opposition and Comment to
[SLECCS] Motion to Dismiss. It assailed the
validity of the voluntary recognition of [SMSLEC]
by [SLECC] and their consequent negotiations and
execution of a CBA. According to [CLUP-
SLECCWA], the same were tainted with malice,
collusion and conspiracy involving some officials
of the Regional Office. Appellant contended that
Chief LEO Raymundo Agravante, DOLE Regional
Office No. IV, Labor Relations Division should
have not approved and recorded the voluntary
recognition of [SMSLEC] by [SLECC] because it
violated one of the major requirements for
Scroll No. 577
voluntary recognition, i.e., non-existence of
another labor organization in the same bargaining
unit. It pointed out that the time of the voluntary
recognition on 20 July 2001, appellants
registration as [CLUP-SLECC and its Affiliates
Workers Union], which covers the same group of
employees covered by Samahang Manggagawa sa
Sta. Lucia East Commercial, was existing and has
neither been cancelled or abandoned. [CLUP-
SLECCWA] also accused Med-Arbiter Bactin of
malice, collusion and conspiracy with appellee
company when he dismissed the petition for
certification election filed by [SMSLEC] for being
moot and academic because of its voluntary
recognition, when he was fully aware of the
pendency of [CLUP-SLECCWAs] earlier petition
for certification election.
Subsequent pleadings filed by [CLUP-
SLECCWA] and [SLECC] reiterated their
respective positions on the validity and invalidity
of the voluntary recognition. On 29 July 2002,
Med-Arbiter Bactin issued the assailed Order.[4]
The Med-Arbiters Ruling
In his Order dated 29 July 2002, Med-Arbiter Anastacio L.
Bactin dismissed CLUP-SLECCWAs petition for direct
certification on the ground of contract bar rule. The prior
voluntary recognition of SMSLEC and the CBA between
SLECC and SMSLEC bars the filing of CLUP-SLECCWAs
61|LabRel – Part IV-C
petition for direct certification. SMSLEC is entitled to enjoy
the rights, privileges, and obligations of an exclusive
bargaining representative from the time of the recording of
the voluntary recognition. Moreover, the duly registered CBA
bars the filing of the petition for direct certification.
CLUP-SLECCWA filed a Memorandum of Appeal of the Med-Arbiters Order before the
Secretary.
The Ruling of the Secretary of Labor and Employment
In her Decision promulgated on 27 December 2002, the
Secretary found merit in CLUP-SLECCWAs appeal. The
Secretary held that the subsequent negotiations and
registration of a CBA executed by SLECC with SMSLEC
could not bar CLUP-SLECCWAs petition. CLUP-SLECC
and its Affiliates Workers Union constituted a registered labor
organization at the time of SLECCs voluntary recognition of
SMSLEC. The dispositive portion of the Secretarys Decision
reads:
WHEREFORE, the appeal is hereby GRANTED
and the Order of the Med-Arbiter dated 29 July
2002 is REVERSED and SET ASIDE.
Accordingly, let the entire records of the case be
remanded to the Regional Office of origin for the
immediate conduct of a certification election,
subject to the usual pre-election conference,
among the regular rank-and-file employees of
[SLECC], with the following choices:
Scroll No. 577
1. Sta. Lucia East Commercial Corporation
Workers Association CLUP Local Chapter;
2. Samahang Manggagawa sa Sta. Lucia East
Commercial; and
3. No Union.
Pursuant to Rule XI, Section II.1 of Department
Order No. 9, appellee corporation is hereby
directed to submit to the office of origin, within
ten (10) days from receipt hereof, the certified list
of its employees in the bargaining unit or when
necessary a copy of its payroll covering the same
employees for the last three (3) months preceding
the issuance of this Decision.
Let a copy of this Decision be furnished the
Bureau of Labor Relations and Labor Relations
Division of Regional Office No. IV for the
cancellation of the recording of voluntary
recognition in favor of Samahang Manggagawa sa
Sta. Lucia East Commercial and the appropriate
annotation of re-registration of CLUP-Sta. Lucia
East Commercial Corporation and its Affiliates
Workers Union to Sta. Lucia East Commercial
Corporation Workers Association-CLUP Local
Chapter.
SO DECIDED.[5]
62|LabRel – Part IV-C

SLECC filed a motion for reconsideration which the
Secretary denied for lack of merit in a Resolution dated 27
March 2003. SLECC then filed a petition for certiorari before
the appellate court.
The Ruling of the Appellate Court
The appellate court affirmed the ruling of the Secretary and
quoted extensively from the Secretarys decision. The
appellate court agreed with the Secretarys finding that the
workers sought to be represented by CLUP-SLECC and its
Affiliates Workers Union included the same workers in the
bargaining unit represented by SMSLEC. SMSLEC was not
the only legitimate labor organization operating in the subject
bargaining unit at the time of SMSLECs voluntary
recognition on 20 July 2001. Thus, SMSLECs voluntary
recognition was void and could not bar CLUP-SLECCWAs
petition for certification election.
The Issue
SLECC raised only one issue in its petition. SLECC asserted
that the appellate court commited a reversible error when it
affirmed the Secretarys finding that SLECCs voluntary
recognition of SMSLEC was done while a legitimate labor
organization was in existence in the bargaining unit.
Scroll No. 577
The Ruling of the Court
The petition has no merit. We see no reason to overturn the
rulings of the Secretary and of the appellate court.
Legitimate Labor Organization
Article 212(g) of the Labor Code defines a labor organization as
any union or association of employees which exists in whole or
in part for the purpose of collective bargaining or of dealing
with employers concerning terms and conditions of
employment. Upon compliance with all the documentary
requirements, the Regional Office or Bureau shall issue in favor
of the applicant labor organization a certificate indicating that it
is included in the roster of legitimate labor
organizations.[6] Any applicant labor organization shall acquire
legal personality and shall be entitled to the rights and privileges
granted by law to legitimate labor organizations upon issuance
of the certificate of registration.[7]
Bargaining Unit
The concepts of a union and of a legitimate labor organization
are different from, but related to, the concept of a bargaining
unit. We explained the concept of a bargaining unit in San
Miguel Corporation v. Laguesma,[8]where we stated that:
A bargaining unit is a group of employees of a
given employer, comprised of all or less than all of
the entire body of employees, consistent with
equity to the employer, indicated to be the best
suited to serve the reciprocal rights and duties of
the parties under the collective bargaining
provisions of the law.
63|LabRel – Part IV-C

The fundamental factors in determining the
appropriate collective bargaining unit are: (1) the
will of the employees (Globe Doctrine); (2)
affinity and unity of the employees interest, such
as substantial similarity of work and duties, or
similarity of compensation and working conditions
(Substantial Mutual Interests Rule); (3) prior
collective bargaining history; and (4) similarity of
employment status.
Contrary to petitioners assertion, this Court has
categorically ruled that the existence of a prior
collective bargaining history is neither decisive
nor conclusive in the determination of what
constitutes an appropriate bargaining unit.
However, employees in two corporations cannot be treated as a
single bargaining unit even if the businesses of the two
corporations are related.[9]
A Legitimate Labor Organization Representing
An Inappropriate Bargaining Unit
CLUP-SLECC and its Affiliates Workers Unions initial
problem was that they constituted a legitimate labor
organization representing a non-appropriate bargaining
unit. However, CLUP-SLECC and its Affiliates Workers Union
subsequently re-registered as CLUP-SLECCWA, limiting its
members to the rank-and-file of SLECC. SLECC cannot ignore
that CLUP-SLECC and its Affiliates Workers Union was a
legitimate labor organization at the time of SLECCs voluntary
recognition of SMSLEC. SLECC and SMSLEC cannot, by
Scroll No. 577
themselves, decide whether CLUP-SLECC and its Affiliates
Workers Union represented an appropriate bargaining unit.
The inclusion in the union of disqualified employees is not
among the grounds for cancellation of registration, unless such
inclusion is due to misrepresentation, false statement or fraud
under the circumstances enumerated in Sections (a) to (c) of
Article 239 of the Labor Code.[10] THUS, CLUP-SLECC AND
ITS AFFILIATES WORKERS UNION, HAVING BEEN
VALIDLY ISSUED A CERTIFICATE OF REGISTRATION,
SHOULD BE CONSIDERED AS HAVING ACQUIRED
JURIDICAL PERSONALITY WHICH MAY NOT BE
ATTACKED COLLATERALLY. THE PROPER PROCEDURE
FOR SLECC IS TO FILE A PETITION FOR CANCELLATION
OF CERTIFICATE OF REGISTRATION[11]OF CLUP-SLECC
AND ITS AFFILIATES WORKERS UNION AND NOT TO
IMMEDIATELY COMMENCE VOLUNTARY RECOGNITION
PROCEEDINGS WITH SMSLEC.
SLECCs Voluntary Recognition of SMSLEC
The employer may voluntarily recognize the representation
status of a union in unorganized establishments.[12] SLECC
WAS NOT AN UNORGANIZED ESTABLISHMENT WHEN IT
VOLUNTARILY RECOGNIZED SMSLEC AS ITS EXCLUSIVE
BARGAINING REPRESENTATIVE ON 20 JULY 2001. CLUP-
SLECC AND ITS AFFILIATES WORKERS UNION FILED A
PETITION FOR CERTIFICATION ELECTION ON 27
FEBRUARY 2001 AND THIS PETITION REMAINED
PENDING AS OF 20 JULY 2001. THUS, SLECCS
VOLUNTARY RECOGNITION OF SMSLEC ON 20 JULY
2001, THE SUBSEQUENT NEGOTIATIONS AND
RESULTING REGISTRATION OF A CBA EXECUTED BY
SLECC AND SMSLEC ARE VOID AND CANNOT BAR CLUP-
64|LabRel – Part IV-C
SLECCWAS PRESENT PETITION FOR CERTIFICATION
ELECTION.
EMPLOYERS PARTICIPATION IN A PETITION FOR
CERTIFICATION ELECTION
We find it strange that the employer itself, SLECC, filed a
motion to oppose CLUP-SLECCWAs petition for certification
election. In petitions for certification election, the employer is a
mere bystander and cannot oppose the petition or appeal the
Med-Arbiters decision. The exception to this rule, which
happens when the employer is requested to bargain collectively,
is not present in the case before us.[13]
WHEREFORE, we DENY the petition. We AFFIRM the
Decision promulgated on 14 August 2003 as well as the
Resolution promulgated on 24 February 2004 of the Court of
Appeals in CA-G.R. SP No. 77015.
SO ORDERED.
G.R. No. 181806 March 12, 2014
WESLEYAN UNIVERSITY-PHILIPPINES, Petitioner,
vs.
WESLEYAN UNIVERSITY-PHILIPPINES FACULTY and STAFF
ASSOCIATION, Respondent.
DECISION
DEL CASTILLO, J.:
Scroll No. 577
A Collective Bargaining Agreement (CBA) is a contract entered into
by an employer and a legitimate labor organization concerning the
terms and conditions of employment.1 Like any other contract, it has
the force of law between the parties and, thus, should be complied
with in good faith.2 Unilateral changes or suspensions in the
implementation of the provisions of the CBA, therefore, cannot be
allowed without the consent of both parties.
This Petition for Review on Certiorari3 under Rule 45 of the Rules of
Court assails the September 25, 2007 Decision4 and the February 5,
2008 Resolution5 of the Court of Appeals (CA) in CA-G.R. SP No.
97053.
Factual Antecedents
Petitioner Wesleyan University-Philippines is a non-stock, non-profit
educational institution duly organized and existing under the laws of
the Philippines.6 Respondent Wesleyan University-Philippines
Faculty and Staff Association, on the other hand, is a duly registered
labor organization7 acting as the sole and exclusive bargaining agent
of all rank-and-file faculty and staff employees of petitioner.8
In December 2003, the parties signed a 5-year CBA9 effective June
1, 2003 until May 31, 2008.10
On August 16, 2005, petitioner, through its President, Atty.
Guillermo T. Maglaya (Atty. Maglaya), issued a
Memorandum11 providing guidelines on the implementation of
vacation and sick leave credits as well as vacation leave
commutation. The pertinent portions of the Memorandum read:
1. VACATION AND SICK LEAVE CREDITS
Vacation and sick leave credits are not automatic. They have
to be earned. Monthly, a qualified employee earns an
equivalent of 1.25 days credit each for VL and SL. Vacation
Leave and Sick Leave credits of 15 days become complete
at the cut off date of May 31 of each year. (Example, only a
total of 5 days credit will be given to an employee for each of
sick leave [or] vacation leave, as of month end September,
65|LabRel – Part IV-C
 that is, 4 months from June to September multiplied by 1.25
days). An employee, therefore, who takes VL or SL beyond
his leave credits as of date will have to file leave without pay
for leaves beyond his credit.
2. VACATION LEAVE COMMUTATION
Only vacation leave is commuted or monetized to cash.
Vacation leave commutation is effected after the second year
of continuous service of an employee. Hence, an employee
who started working June 1, 2005 will get his commutation
on May 31, 2007 or thereabout.12
On August 25, 2005, respondent’s President, Cynthia L. De Lara
(De Lara) wrote a letter13 to Atty. Maglaya informing him that
respondent is not amenable to the unilateral changes made by
petitioner.14 De Lara questioned the guidelines for being violative of
existing practices and the CBA,15 specifically Sections 1 and 2,
Article XII of the CBA, to wit:
ARTICLE XII
VACATION LEAVE AND SICK LEAVE
SECTION 1. VACATION LEAVE - All regular and non-tenured rank-
and-file faculty and staff who are entitled to receive shall enjoy
fifteen (15) days vacation leave with pay annually.
1.1 All unused vacation leave after the second year of service shall
be converted into cash and be paid to the entitled employee at the
end of each school year to be given not later than August 30 of each
year.
SECTION 2. SICK LEAVE - All regular and non-tenured rank-and-
file faculty and staff shall enjoy fifteen (15) days sick leave with pay
annually.16
On February 8, 2006, a Labor Management Committee (LMC)
Meeting was held during which petitioner advised respondent to file
a grievance complaint on the implementation of the vacation and
sick leave policy.17 In the same meeting, petitioner announced its
Scroll No. 577
plan of implementing a one-retirement policy,18 which was
unacceptable to respondent.
Ruling of the Voluntary Arbitrator
Unable to settle their differences at the grievance level, the parties
referred the matter to a Voluntary Arbitrator. During the hearing,
respondent submitted affidavits to prove that there is an established
practice of giving two retirement benefits, one from the Private
Education Retirement Annuity Association (PERAA) Plan and
another from the CBA Retirement Plan. Sections 1, 2, 3 and 4 of
Article XVI of the CBA provide:
ARTICLE XVI
SEPARATION, DISABILITY AND RETIREMENT PAY
SECTION 1. ELIGIBILITY FOR MEMBERSHIP - Membership in the
Plan shall be automatic for all full-time, regular staff and tenured
faculty of the University, except the University President.
Membership in the Plan shall commence on the first day of the
month coincident with or next following his statement of
Regular/Tenured Employment Status.
SECTION 2. COMPULSORY RETIREMENT DATE - The
compulsory retirement date of each Member shall be as follows:
a. Faculty – The last day of the School Year, coincident with
his attainment of age sixty (60) with at least five (years) of
unbroken, credited service.
b. Staff – Upon reaching the age of sixty (60) with at least
five (5) years of unbroken, credited service.
SECTION 3. OPTIONAL RETIREMENT DATE - A Member may opt
for an optional retirement prior to his compulsory retirement. His
number of years of service in the University shall be the basis of
computing x x x his retirement benefits regardless of his
chronological age.
66|LabRel – Part IV-C
SECTION 4. RETIREMENT BENEFIT - The retirement benefit shall
be a sum equivalent to 100% of the member’s final monthly salary
for compulsory retirement.
For optional retirement, the vesting schedule shall be:
x x x x19
On November 2, 2006, the Voluntary Arbitrator rendered a
Decision20 declaring the one-retirement policy and the Memorandum
dated August 16, 2005 contrary to law. The dispositive portion of the
Decision reads:
WHEREFORE, the following award is hereby made:
1. The assailed University guidelines on the availment of
vacation and sick leave credits and vacation leave
commutation are contrary to law. The University is
consequently ordered to reinstate the earlier scheme,
practice or policy in effect before the issuance of the said
guidelines on August 16, 2005;
2. The "one retirement" policy is contrary to law and is hereby
revoked and rescinded. The University is ordered x x x to
resume and proceed with the established practice of
extending to qualified employees retirement benefits under
both the CBA and the PERAA Plan.
3. The other money claims are denied.21
Ruling of the Court of Appeals
Aggrieved, petitioner appealed the case to the CA via a Petition for
Review under Rule 43 of the Rules of Court.
On September 25, 2007, the CA rendered a Decision22 finding the
rulings of the Voluntary Arbitrator supported by substantial evidence.
It also affirmed the nullification of the one-retirement policy and the
Memorandum dated August 16, 2005 on the ground that these
Scroll No. 577
unilaterally amended the CBA without the consent of
respondent.23Thus:
WHEREFORE, the instant appeal is DISMISSED for lack of merit.
SO ORDERED.24
Petitioner moved for reconsideration but the same was denied by
the CA in its February 5, 2008 Resolution.25
Issues
Hence, this recourse by petitioner raising the following issues:
a.
Whether x x x the [CA] committed grave and palpable error in
sustaining the Voluntary Arbitrator’s ruling that the Affidavits
submitted by Respondent WU-PFSA are substantial evidence as
defined by the rules and jurisprudence that would substantiate that
Petitioner WU-P has long been in the practice of granting its
employees two (2) sets of Retirement Benefits.
b.
Whether x x x the [CA] committed grave and palpable error in
sustaining the Voluntary Arbitrator’s ruling that a university practice
of granting its employees two (2) sets of Retirement Benefits had
already been established as defined by the law and jurisprudence
especially in light of the illegality and lack of authority of such
alleged grant.
c.
Whether x x x the [CA] committed grave and palpable error in
sustaining the Voluntary Arbitrator’s ruling that it is incumbent upon
Petitioner WU-P to show proof that no Board Resolution was issued
granting two (2) sets of Retirement Benefits.
d.
67|LabRel – Part IV-C
Whether x x x the [CA] committed grave and palpable error in
revoking the 16 August 2005 Memorandum of Petitioner WU-P for
being contrary to extant policy.26
Petitioner’s Arguments
Petitioner argues that there is only one retirement plan as the CBA
Retirement Plan and the PERAA Plan are one and the same.27 It
maintains that there is no established company practice or policy of
giving two retirement benefits to its employees.28 Assuming, without
admitting, that two retirement benefits were released,29 petitioner
insists that these were done by mere oversight or mistake as there
is no Board Resolution authorizing their release.30 And since these
benefits are unauthorized and irregular, these cannot ripen into a
company practice or policy.31 As to the affidavits submitted by
respondent, petitioner claims that these are self-serving
declarations,32and thus, should not be given weight and credence.33
In addition, petitioner claims that the Memorandum dated August 16,
2005, which provides for the guidelines on the implementation of
vacation and sick leave credits as well as vacation leave
commutation, is valid because it is in full accord with existing
policy.34
Respondent’s Arguments
Respondent belies the claims of petitioner and asserts that there are
two retirement plans as the PERAA Retirement Plan, which has
been implemented for more than 30 years, is different from the CBA
Retirement Plan.35 Respondent further avers that it has always been
a practice of petitioner to give two retirement benefits36and that this
practice was established by substantial evidence as found by both
the Voluntary Arbitrator and the CA.37
As to the Memorandum dated August 16, 2005, respondent asserts
that it is arbitrary and contrary to the CBA and existing practices as it
added qualifications or limitations which were not agreed upon by
the parties.38
Our Ruling
Scroll No. 577
The Petition is bereft of merit.
The Non-Diminution Rule found in Article 10039 of the Labor Code
explicitly prohibits employers from eliminating or reducing the
benefits received by their employees. This rule, however, applies
only if the benefit is based on an express policy, a written contract,
or has ripened into a practice.40 To be considered a practice, it must
be consistently and deliberately made by the employer over a long
period of time.41
An exception to the rule is when "the practice is due to error in the
construction or application of a doubtful or difficult question of
law."42 The error, however, must be corrected immediately after its
discovery;43 otherwise, the rule on Non-Diminution of Benefits would
still apply.
The practice of giving two retirement
benefits to petitioner’s employees is
supported by substantial evidence.
In this case, respondent was able to present substantial evidence in
the form of affidavits to support its claim that there are two
retirement plans. Based on the affidavits, petitioner has been giving
two retirement benefits as early as 1997.44 Petitioner, on the other
hand, failed to present any evidence to refute the veracity of these
affidavits. Petitioner’s contention that these affidavits are self-serving
holds no water. The retired employees of petitioner have nothing to
lose or gain in this case as they have already received their
retirement benefits. Thus, they have no reason to perjure
themselves. Obviously, the only reason they executed those
affidavits is to bring out the truth. As we see it then, their affidavits,
corroborated by the affidavits of incumbent employees, are more
than sufficient to show that the granting of two retirement benefits to
retiring employees had already ripened into a consistent and
deliberate practice.
Moreover, petitioner’s assertion that there is only one retirement
plan as the CBA Retirement Plan and the PERAA Plan are one and
the same is not supported by any evidence. There is nothing in
Article XVI of the CBA to indicate or even suggest that the "Plan"
68|LabRel – Part IV-C
referred to in the CBA is the PERAA Plan. Besides, any doubt in the
interpretation of the provisions of the CBA should be resolved in
favor of respondent. In fact, petitioner’s assertion is negated by the
announcement it made during the LMC Meeting on February 8,
2006 regarding its plan of implementing a "one-retirement plan." For
if it were true that petitioner was already implementing a one-
retirement policy, there would have been no need for such
announcement. Equally damaging is the letter-memorandum45 dated
May 11, 2006, entitled "Suggestions on the defenses we can
introduce to justify the abolition of double retirement policy,"
prepared by the petitioner’s legal counsel.
These circumstances, taken together, bolster the finding that the
two-retirement policy is a practice. Thus, petitioner cannot, without
1âw phi1
the consent of respondent, eliminate the two-retirement policy and
implement a one-retirement policy as this would violate the rule on
non-diminution of benefits.
As a last ditch effort to abolish the two-retirement policy, petitioner
contends that such practice is illegal or unauthorized and that the
benefits were erroneously given by the previous administration. No
evidence, however, was presented by petitioner to substantiate its
allegations.
Considering the foregoing disquisition, we agree with the findings of
the Voluntary Arbitrator, as affirmed by the CA, that there is
substantial evidence to prove that there is an existing practice of
giving two retirement benefits, one under the PERAA Plan and
another under the CBA Retirement Plan.
The Memorandum dated August 16,
2005 is contrary to the existing CBA.
Neither do we find any reason to disturb the findings of the CA that
the Memorandum dated August 16, 2005 is contrary to the existing
CBA.
Sections 1 and 2 of Article XII of the CBA provide that all covered
employees are entitled to 15 days sick leave and 15 days vacation
leave with pay every year and that after the second year of service,
Scroll No. 577
all unused vacation leave shall be converted to cash and paid to the
employee at the end of each school year, not later than August 30 of
each year.
The Memorandum dated August 16, 2005, however, states that
vacation and sick leave credits are not automatic as leave credits
would be earned on a month-to-month basis. This, in effect, limits
the available leave credits of an employee at the start of the school
year. For example, for the first four months of the school year or
from June to September, an employee is only entitled to five days
vacation leave and five days sick leave.46 Considering that the
Memorandum dated August 16, 2005 imposes a limitation not
agreed upon by the parties nor stated in the CBA, we agree with the
CA that it must be struck down.
In closing, it may not be amiss to mention that when the provision of
the CBA is clear, leaving no doubt on the intention of the parties, the
literal meaning of the stipulation shall govem.47
However, if there is doubt in its interpretation, it should be resolved
in favor of labor,48 as this is mandated by no less than the
Constitution.49
WHEREFORE, the Petition is hereby DENIED. The assailed
September 25, 2007 Decision and the February 5, 2008 Resolution
of the Court of Appeals in CA-G.R. SP No. 97053 are hereby
AFFIRMED.
SO ORDERED.
De la Salle University, Petitioner, v. De la Salle
University Employees Association, Respondent.
LEONARDO-DE CASTRO, J.:
69|LabRel – Part IV-C
FACTS:
On May 30, 2000, some of De La Salle University
Employees Association (DLSUEA-NAFTEU) members
headed by Belen Aliazas (the Aliazas faction) filed a
petition for the election of union officers in the Bureau of
Labor Relations (BLR). They alleged therein that there
has been no election for DLSUEA-NAFTEU’s officers
since 1992 in supposed violation of the union’s
constitution and by-laws which provided for an election
of officers every three years. It would appear that
DLSUEA-NAFTEU repeatedly voted to approve the
hold-over of the previously elected officers led by
Baylon Bañez (Bañez faction).
When the matter was eventually elevated to the BLR
Director, the latter ruled that the Bañez faction’s tenure
in office is valid and subsisting until their successors
have been duly elected and qualified.
Thereafter, DLSUEA-NAFTEU entered into a five-year
CBA with De La Salle University (DLSU). The Aliazas
faction wrote a letter to DLSU requesting it to place in
escrow the union dues and other fees deducted from
the salaries of employees pending the resolution of the
intra-union conflict. DLSUEA-NAFTEU filed a complaint
for unfair labor practice in the NLRC alleging that DLSU
violated Article 248(a) and (g) of the Labor Code.
DLSUEA-NAFTEU asserted that that the creation of
escrow accounts was not an act of neutrality as it was
influenced by the Aliazas factions’s letter and was an
act of interference with the internal affairs of the union.
The Labor Arbiter dismissed the complaint for unfair
Scroll No. 577
labor practice.
Subsequently, DLSUEA-NAFTEU sent a letter to DLSU
requesting for the renegotiation of the economic terms
for the fourth and fifth years of the then current CBA.
DLSU denied the request prompting DLSUEA-NAFTEU
to file a notice of strike. The Secretary of Labor
assumed jurisdiction and found DLSU guilty of unfair
labor practice.
Consequently, DLSUEA-NAFTEU reiterated its demand
on DLSU to bargain collectively pursuant to the
aforementioned Decision of the Secretary of Labor.
Again, DLSU declined the request. Thus, DLSUEA-
NAFTEU filed another notice of strike. The Secretary of
Labor cited his earlier decision and ruled that DLSU is
guilty of unfair labor practice. In accordance with the
said decision, DLSU turned over to DLSUEA-NAFTEU
the collected union dues and agency fees from
employees which were previously placed in escrow.
Aggrieved, DLSU appealed to the Court of Appeals
(CA). The CA dismissed the petition. When the matter
was elevated to the Supreme Court, the Court affirmed
the CA. DLSU moved to reconsider but the Court
denied the same. Thus, the decision attained finality.
Meanwhile, DLSUEA-NAFTEU was ordered to file a
comment, and, subsequently, this petition was given
due course.
ISSUE: Whether or not DLSU is guilty of unfair labor
practice when it refused to bargain collectively with
DLSUEA-NAFTEU in light of the intra-union dispute
70|LabRel – Part IV-C
between DLSUEA-NAFTEU two opposing factions? collectively bargain with respondent union without valid
reason.
HELD: The petition is denied.
Petition is DENIED.
Inevitably, G.R. No. 168477 and this petition seek only
one relief, that is, to absolve petitioner from
respondent’s charge of committing an unfair labor
practice, or specifically, a violation of Article 248(g) in FVC LABOR UNION- G.R. No. 176249
relation to Article 252 of the Labor Code. In other words, PHILIPPINE TRANSPORT AND
our previous affirmance of the Court of Appeals’ finding GENERAL WORKERS Present:
– that petitioner erred in suspending collective ORGANIZATION (FVCLU-
bargaining negotiations with the union and in placing the PTGWO), CARPIO, J., Chairperson,
union funds in escrow considering that the intra-union Petitioner, LEONARDO-DE CASTRO,
dispute between the Aliazas and Bañez factions was BRION,
not a justification therefor — is binding herein. DEL CASTILLO, and
- versus - ABAD, JJ.
The law of the case has been defined as the opinion
delivered on a former appeal. It means that whatever is
once irrevocably established as the controlling legal rule SAMA-SAMANG
or decision between the same parties in the same case NAGKAKAISANG
continues to be the law of the case, whether correct on MANGGAGAWA SA FVC-
general principles or not, so long as the facts on which SOLIDARITY OF Promulgated:
such decision was predicated continue to be the facts of INDEPENDENT AND GENERAL
the case before the court. LABOR ORGANIZATIONS November 27, 2009
(SANAMA-FVC-SIGLO),
Neither can petitioner seek refuge in its defense that as Respondent.
early as November 2003 it had already released the x----------------------------------------------------------------------------------
escrowed union dues to respondent and normalized DECISION
relations with the latter. The fact remains that from its
receipt of the July 28, 2003 Decision of the Secretary of BRION, J.:
Labor in OS-AJ-0015-2003 until its receipt of the
November 17, 2003 Decision of the Secretary of Labor
in OS-AJ-0033-2003, petitioner failed in its duty to
Scroll No. 577 71|LabRel – Part IV-C
We pass upon the petition for review on certiorari under Rule extending the original five-year period of the CBA by four (4)
45 of the Rules of Court[1] filed by FVC Labor months.
UnionPhilippine Transport and General Workers
Organization (FVCLU-PTGWO) to challenge the Court of On January 21, 2003, nine (9) days before the January 30,
Appeals (CA) decision of July 25, 2006[2] and its resolution 2003 expiration of the originally-agreed five-year CBA term
rendered on January 15, 2007[3] in C.A. G.R. SP No. 83292.[4] (and four [4] months and nine [9] days away from the
THE ANTECEDENTS expiration of the amended CBA period), the respondent
Sama-Samang Nagkakaisang Manggagawa sa FVC-Solidarity
The facts are undisputed and are summarized below. of Independent and General Labor Organizations (SANAMA-
SIGLO) filed before the Department of Labor and
On December 22, 1997, the petitioner FVCLU-PTGWO the Employment (DOLE) a petition for certification election for
recognized bargaining agent of the rank-and-file employees the same rank-and-file unit covered by the FVCLU-PTGWO
of the FVC Philippines, Incorporated (company) signed a CBA. FVCLU-PTGWO moved to dismiss the petition on the
five-year collective bargaining agreement (CBA) with the ground that the certification election petition was filed outside
company. The five-year CBA period was from February 1, the freedom period or outside of the sixty (60) days before the
1998 to January 30, 2003.[5] At the end of the 3rd year of the expiration of the CBA on May 31, 2003.
five-year term and pursuant to the CBA, FVCLU-PTGWO
and the company entered into the renegotiation of the CBA
Action on the Petition and Related Incidents
and modified, among other provisions, the CBAs
duration. Article XXV, Section 2 of the renegotiated CBA
On June 17, 2003, Med-Arbiter Arturo V. Cosuco dismissed
provides that this re-negotiation agreement shall take effect
the petition on the ground that it was filed outside the 60-day
beginning February 1, 2001 and until May 31, 2003 thus
period counted from the May 31, 2003 expiry date of the
Scroll No. 577 72|LabRel – Part IV-C
amended CBA.[6] SANAMA-SIGLO appealed the Med-
Arbiters Order to the DOLE Secretary, contending that the
filing of the petition on January 21, 2003 was within 60-
days from the January 30, 2003 expiration of the original
CBA term.
DOLE Secretary Patricia A. Sto. Tomas sustained
SANAMA-SIGLOs position, thereby setting aside the
decision of the Med-Arbiter.[7] She ordered the conduct of a
certification election in the company. FVCLU-PTGWO
moved for the reconsideration of the Secretarys decision.
On November 6, 2003, DOLE Acting Secretary
Manuel G. Imson granted the motion; he set aside the August
6, 2003 DOLE decision and dismissed the petition as the
Med-Arbiters Order of June 17, 2003 did.[8] The Acting
Secretary held that the amended CBA (which extended the
representation aspect of the original CBA by four [4] months)
had been ratified by members of the bargaining unit some of
whom later organized themselves as SANAMA-SIGLO, the
certification election applicant. Since these SANAMA-
SIGLO members fully accepted and in fact received the
benefits arising from the amendments, the Acting Secretary
Scroll No. 577
rationalized that they also accepted the extended term of the
CBA and cannot now file a petition for certification election
based on the original CBA expiration date.
SANAMA-SIGLO moved for the reconsideration of
the Acting Secretarys Order, but Secretary Sto. Tomas denied
the motion in her Order of January 30, 2004.[9]
SANAMA-SIGLO sought relief from the CA through a
petition for certiorari under Rule 65 of the Rules of Court
based on the grave abuse of discretion the Labor Secretary
committed when she reversed her earlier decision calling for
a certification election. SANAMA-SIGLO pointed out that
the Secretarys new ruling is patently contrary to the express
provision of the law and established jurisprudence.
THE CA DECISION
The CA found SANAMA-SIGLOs petition meritorious on
the basis of the applicable law[10] and the rules,[11] as
interpreted in the congressional debates. It set aside the
73|LabRel – Part IV-C
challenged DOLE Secretary decisions and reinstated her February 1, 1998 to January 30, 2003 CBA that it
earlier ruling calling for a certification election. The appellate renegotiated with the company. The renegotiated CBA
court declared: changed the CBAs remaining term from February 1, 2001 to

It is clear from the foregoing that while the parties may

May 31, 2003. To FVCLU-PTGWO, this extension of the
renegotiate the other provisions (economic and non- CBA term also changed the unions exclusive bargaining
economic) of the CBA, this should not affect the five-
year representation aspect of the original CBA. If the representation status and effectively moved the reckoning
duration of the renegotiated agreement does not coincide
with but rather exceeds the original five-year term, the point of the 60-day freedom period from January 30, 2003 to
same will not adversely affect the right of another union May 30, 2003. FVCLU-PTGWO thus moved to dismiss the
to challenge the majority status of the incumbent
bargaining agent within sixty (60) days before the lapse petition for certification election filed on January 21, 2003 (9
of the original five (5) year term of the CBA. In the event
a new union wins in the certification election, such union days before the expiry date on January 30, 2003 of the
is required to honor and administer the renegotiated CBA original CBA) by SANAMA-SIGLO on the ground that the
throughout the excess period.
petition was filed outside the authorized 60-day freedom
FVCLU-PTGWO moved to reconsider the CA decision
period.
but the CA denied the motion in its resolution of January 15,
2007.[12] With this denial, FVCLU-PTGWO now comes
It also submits in its petition that the SANAMA-
before us to challenge the CA rulings.[13] It argues that in light
SIGLO is estopped from questioning the extension of the
of the peculiar attendant circumstances of the case, the CA
CBA term under the amendments because its members are the
erred in strictly applying Section 11 (11b), Rule XI, Book V
very same ones who approved the amendments, including the
of the Omnibus Rules Implementing the Labor Code, as
expiration date of the CBA, and who benefited from these
amended by Department Order No. 9, s. 1997.[14]
amendments.

Apparently, the peculiar circumstances the FVCLU-PTGWO

Lastly, FVCLU-PTGWO posits that the representation
referred to relate to the economic and other provisions of the
petition had been rendered moot by a new CBA it entered into
Scroll No. 577 74|LabRel – Part IV-C
with the company covering the period June 1, 2003 to May case. We granted the request for relief and dispensed with the
31, 2008.[15] filing of a comment.[19]

THE COURTS RULING

Required to comment by the Court[16] and to show

While SANAMA-SIGLO has manifested its abandonment of
cause for its failure to comply,[17] SANAMA-SIGLO
its challenge to the exclusive bargaining representation status
manifested on October 10, 2007 that: since the promulgation
of FVCLU-PTGWO, we deem it necessary in the exercise of
of the CA decision on July 25, 2006 or three years after the
our discretion to resolve the question of law raised since this
petition for certification election was filed, the local leaders of
exclusive representation status issue will inevitably recur in
SANAMA-SIGLO had stopped reporting to the federation
the future as workplace parties avail of opportunities to
office or attending meetings of the council of local leaders;
prolong workplace harmony by extending the term of CBAs
the SANAMA-SIGLO counsel, who is also the SIGLO
already in place.[20]
national president, is no longer in the position to pursue the
present case because the local union and its leadership, who
The legal question before us centers on the effect of the
are principals of SIGLO, had given up and abandoned their
amended or extended term of the CBA on the exclusive
desire to contest the representative status of FVCLU-
representation status of the collective bargaining agent and
PTGWO; and a new CBA had already been signed by
the right of another union to ask for certification as exclusive
FVCLU-PTGWO and the company.[18] Under these
bargaining agent. The question arises because the law allows
circumstances, SANAMA-SIGLO contends that pursuing the
a challenge to the exclusive representation status of a
case has become futile, and accordingly simply adopted the
collective bargaining agent through the filing of a
CA decision of July 25, 2006 as its position; its counsel
likewise asked to be relieved from filing a comment in the
Scroll No. 577 75|LabRel – Part IV-C
certification election petition only within 60 days from the
expiration of the five-year CBA.
Article 253-A of the Labor Code covers this situation and it
provides:
Terms of a collective bargaining agreement. Any
Collective Bargaining Agreement that the parties may
enter into, shall, insofar as the representation aspect is
concerned, be for a term of five (5) years. No petition
questioning the majority status of the incumbent
bargaining agent shall be entertained and no certification
election shall be conducted by the Department of Labor
and Employment outside of the sixty day period
immediately before the date of expiry of such five-year
term of the Collective Bargaining Agreement. All other
provisions of the Collective Bargaining Agreement shall
be renegotiated not later than three (3) years after its
execution.
Any agreement on such other provisions of the
Collective Bargaining Agreement entered into within six
(6) months from the date of expiry of the term of such
other provisions as fixed in such Collective Bargaining
Agreement, shall retroact to the day immediately
following such date. If any such agreement is entered
into beyond six months, the parties shall agree on the
duration of retroactivity thereof. In case of a deadlock in
the renegotiation of the collective bargaining agreement,
the parties may exercise their rights under this Code.
Scroll No. 577
This Labor Code provision is implemented through
Book V, Rule VIII of the Rules Implementing the Labor
Code[21] which states:
Sec. 14. Denial of the petition; grounds. The
Med-Arbiter may dismiss the petition on any of the
following grounds:
xxxx
(b) the petition was filed before or after the
freedom period of a duly registered collective
bargaining agreement; provided that the sixty-
day period based on the original collective
bargaining agreement shall not be affected by
any amendment, extension or renewal of the
collective bargaining
agreement (underscoring supplied).
xxxx
The root of the controversy can be traced to a
misunderstanding of the interaction between a unions
exclusive bargaining representation status in a CBA and the
term or effective period of the CBA.
FVCLU-PTGWO has taken the view that its exclusive
representation status should fully be in step with the term of
the CBA and that this status can be challenged only within 60
76|LabRel – Part IV-C
days before the expiration of this term. Thus, when the term
of the CBA was extended, its exclusive bargaining status was
similarly extended so that the freedom period for the filing of
a petition for certification election should be counted back
from the expiration of the amended CBA term.
We hold this FVCLU-PTGWO position to be correct,
but only with respect to the original five-year term of the
CBA which, by law, is also the effective period of the unions
exclusive bargaining representation status. While the parties
may agree to extend the CBAs original five-year term
together with all other CBA provisions, any such amendment
or term in excess of five years will not carry with it a change
in the unions exclusive collective bargaining status. By
express provision of the above-quoted Article 253-A, the
exclusive bargaining status cannot go beyond five years and
the representation status is a legal matter not for the
workplace parties to agree upon. In other words, despite an
agreement for a CBA with a life of more than five years,
either as an original provision or by amendment, the
bargaining unions exclusive bargaining status is effective
only for five years and can be challenged within sixty (60)
days prior to the expiration of the CBAs first five years. As
Scroll No. 577
we said in San Miguel Corp. Employees UnionPTGWO, et al.
v. Confesor, San Miguel Corp., Magnolia Corp. and San
Miguel Foods, Inc.,[22] where we cited the Memorandum of
the Secretary of Labor and Employment dated February 24,
1994:
In the event however, that the parties, by mutual
agreement, enter into a renegotiated contract with a term
of three (3) years or one which does not coincide with
the said five-year term and said agreement is ratified by
majority of the members in the bargaining unit, the
subject contract is valid and legal and therefore, binds
the contracting parties. The same will however not
adversely affect the right of another union to challenge
the majority status of the incumbent bargaining agent
within sixty (60) days before the lapse of the original
five (5) year term of the CBA.
In the present case, the CBA was originally signed for
a period of five years, i.e., from February 1, 1998 to January
30, 2003, with a provision for the renegotiation of the CBAs
other provisions at the end of the 3rd year of the five-year
CBA term. Thus, prior to January 30, 2001 the workplace
parties sat down for renegotiation but instead of confining
themselves to the economic and non-economic CBA
provisions, also extended the life of the CBA for another four
months, i.e., from the original expiry date on January 30,
2003 to May 30, 2003.
77|LabRel – Part IV-C
 WHEREFORE, premises considered,
As discussed above, this negotiated extension of the we AFFIRM the correctness of the challenged Decision and
CBA term has no legal effect on the FVCLU-PTGWOs Resolution of the Court of Appeals and
exclusive bargaining representation status which remained accordingly DISMISS the petition, but
effective only for five years ending on the original expiry date nevertheless DECLARE that no certification election,
of January 30, 2003. Thus, sixty days prior to this date, or pursuant to the underlying petition for certification election
starting December 2, 2002, SANAMA-SIGLO could properly filed with the Department of Labor and Employment, can be
file a petition for certification election. Its petition, filed on enforced as this petition has effectively been abandoned.
January 21, 2003 or nine (9) days before the expiration of the
SO ORDERED.
CBA and of FVCLU-PTGWOs exclusive bargaining status,
was seasonably filed.

MALAYAN EMPLOYEES G.R. No. 181357

We thus find no error in the appellate courts ruling ASSOCIATION-FFW and
reinstating the DOLE order for the conduct of a certification RODOLFO MANGALINO, Present:
Petitioners,
election. If this ruling cannot now be given effect, the only
CARPIO, J., Chairperson
reason is SANAMA-SIGLOs own desistance; we cannot CORONA,*
disregard its manifestation that the members of SANAMA VELASCO,**
- versus - BRION, and
themselves are no longer interested in contesting the PEREZ, JJ.
exclusive collective bargaining agent status of FVCLU-
PTGWO. This recognition is fully in accord with the Labor MALAYAN INSURANCE Promulgated:
COMPANY, INC., February 2, 2010
Codes intent to foster industrial peace and harmony in the
Respondent.
workplace.
x ---------------------------------------------------------------------------------

Scroll No. 577 78|LabRel – Part IV-C

 DECISION
BRION, J.:
The petitioner Malayan Employees Association-FFW
(union) asks us in this petition for certiorari,[1] to set aside
the June 26, 2007 decision[2] and the November 29,
2007resolution[3] of the Court of Appeals (CA) in CA-G.R. SP
No. 80691, ruling that the suspension imposed by the
respondent Malayan Insurance Company, Inc. (company) on
union member Rodolfo Mangalino (Mangalino) is
valid. Mangalino was suspended for taking a union leave
without the prior authority of his department head and despite
a previous disapproval of the requested leave.
BACKGROUND FACTS
The union is the exclusive bargaining agent of the rank-
and-file employees of the company. A provision in the unions
collective bargaining agreement (CBA) with the company
allows union officials to avail of union leaves with pay for a
total of ninety-man days per year for the purpose of attending
grievance meetings, Labor-Management Committee
meetings, annual National Labor Management Conferences,
labor education programs and seminars, and other union
activities.
Scroll No. 577
The company issued a rule in November 2002 requiring not
only the prior notice that the CBA expressly requires, but
prior approval by the department head before the union and
its members can avail of union leaves. The rule was placed
into effect in November 2002 without any objection from the
union until a union officer, Mangalino, filed union leave
applications in January and February, 2004. His department
head disapproved the applications because the department
was undermanned at that time.
Despite the disapproval, Mangalino proceeded to take
the union leave. He said he believed in good faith that he had
complied with the existing company practice and with the
procedure set forth in the CBA. The company responded by
suspending him for one week and, thereafter, for a month, for
his second offense in February 2004.
The union raised the suspensions as a grievance issue and
went through all the grievance processes, including the
referral of the matter to the companys president, Yvonne
Yuchengco. After all internal remedies failed, the union went
to the National Conciliation and Mediation Board for
preventive mediation. When this recourse also failed, the
parties submitted the dispute to voluntary arbitration[4] on the
following issues:
79|LabRel – Part IV-C
 1. whether or not Mangalinos suspensions were valid;
and
2. whether or not Mangalino should be paid
backwages for the duration of the suspensions.
The Voluntary Arbitrators decided the submitted
dispute on November 26, 2004,[5] ruling as follows:
WHEREFORE, in view of the foregoing,
this Honorable Office adjudged the suspension of
Mr. Rodolfo Mangalinos on first availment of
union leave invalid while the second suspension
valid but illicit in terms of penalty of thirty (30)
days suspension. We consider the honesty of the
same as mitigating circumstances, for the
Chairman of this panel of Arbitrators attested that
complainant attended labor matter in the Office of
Voluntary Arbitrator last January 19, 2004 and
February 5, 2004. However, it is good to note the
wisdom of Justice Narvasa in the aforecited
Supreme Court Ruling of obey first before you
complain.
In view thereof, this Honorable Office
reduced the suspension from thirty seven (37) days
to ten (10) days only. Henceforth, the Complainant
is entitled to twenty seven (27) days backwages.
Proof of payment of backwages should be
submitted to the chairman of this Panel of
Arbitrators within ten (10) days from receipt
hereof.
Scroll No. 577
Parties are hereby enjoined to comply in this
Award as provided in the submission Agreement.
SO ORDERED.
Notably, the decision was not unanimous. Voluntary
Arbitrator dela Fuente submitted the following dissent:[6]
The act of any employee that can only be
interpreted to be an open and utter display of
arrogance and unconcern for the welfare of his
Company thru the use of what he pretends to
believe to be an unbridled political right cannot be
allowed to pass without sanction lest the employer
desires anarchy and chaos to reign in its midst.
Hence, having failed to comply with the
requirements for availment of union leaves and for
going on such leave despite the express
disapproval of his superior, Mr. Mangalinos two
suspensions are valid and he is not entitled to any
backwages for the duration of his suspensions.
The company appealed the decision to the CA on May 12,
2005 through a petition for review under Rule 43 of the Rules
of Court (Rules). In a decision promulgated on June 26, 2007,
the CA granted the companys petition and upheld the validity
of Mangalinos suspension on the basis of the companys
prerogative to prescribe reasonable rules to regulate the use of
union leaves.[7]
80|LabRel – Part IV-C
The union moved for the reconsideration of the CA decision
and received the CAs denial (through its resolution
of November 29, 2007) on December 8, 2007.[8]
THE PETITION
The union seeks relief from this Court against the CA
decision through its Rule 65 petition for certiorari filed
on February 6, 2008.[9] It alleged that the CA committed
grave abuse of discretion when, despite the clear terms of the
CBA grant of union leaves, it disregarded the evidence on
record and recognized that the companys use of its
management prerogative as justification was proper.
In our Resolution of March 5, 2008, we resolved to
treat the Rule 65 petition as a petition for review
on certiorari under Rule 45 of the Rules, and required the
respondent company to comment.[10] After comment, we
required the union to file its reply.[11] Thereafter, the parties
submitted their respective memoranda.[12]
In its comment, the company raised both procedural
and substantive objections.
It questioned the petitions compliance with the Rules,
particularly the use of a petition for certiorari under Rule 65
Scroll No. 577
to question the CA decision, when the appropriate remedy is a
petition for review on certiorari under Rule 45. The company
also asserted that the union violated Section 2, Rule 45 when
it failed to attach the material portions of the record as would
support its petition, such as the companys pleadings and the
entirety of the companys evidence. More importantly, it
posited that the petition is barred by time limitation and has
lapsed to finality as it was filed sixty-two (62) days after the
unions receipt of the CA decision.
On the substantive aspect, the company mainly
contended that the regulation of the use of union leaves is
within the companys management prerogative, and the
company was simply exercising its management prerogative
when it required its employees to first obtain the approval of
either the department head or the human resource manager
before making use of any union leave. Thus, Mangalino
committed acts of insubordination when he insisted on going
on leave despite the disapproval of his leave applications.
In its reply and subsequent memorandum, the union
presented its justification for the technical deficiencies the
company cited (quoted below), and maintained as well that
the use of management prerogative was improper because the
CBA grant of the union leave benefit did not require prior
company approval as a condition; any change in the CBA
81|LabRel – Part IV-C
grant requires union conformity. The union posited as well
that any unilateral change in the CBA terms violates Article
255 of the Labor Code, which guarantees the right of
employees to participate in the companys policy and decision-
making processes on matters directly affecting their interests.
It argued against the company position that it had not objected
to the company rule and is now in estoppel.
THE COURTS RULING
We deny the petition for lack of merit.
The company position that the union should have filed
an appeal under Rule 45 of the Rules and not a petition
for certiorari is correct. Section 1, Rule 45 of the Rules states
that:
SECTION 1. Filing of petition with
Supreme Court. A party desiring to appeal
by certiorari from a judgment or final order or
resolution of the Court of Appeals, the
Sandiganbayan, the Regional Trial Court or other
courts whenever authorized by law, may file with
the Supreme Court a verified petition for
review on certiorari. The petition shall raise only
questions of law which must be distinctly set forth.
[Emphasis supplied.]
Scroll No. 577
Complementing this Rule is Section 1, Rule 65 which
provides that a special civil action for certiorari under Rule
65 lies only when "there is no appeal, nor plain, speedy and
adequate remedy in the ordinary course of law." From this
Rule proceeds the established jurisprudential ruling that a
petition for certiorari cannot be allowed when a party fails to
appeal a judgment despite the availability of that remedy,
as certiorari is not a substitute for a lost appeal.[13]
In our Resolution of March 5, 2008, we opted to
liberally apply the rules and to treat the petition as a petition
for review on certiorari under Rule 45 in order to have a total
view of the merits of the petition in light of the importance of
a ruling on the presented issues. The union which did not
present any justification at the outset for the petitions
deficiencies, particularly for the late filing had this to say:
9) In a resolution dated 05 March 2008, this
Honorable Court resolved to treat the petition in
the above-captioned case as a petition for review
on certiorari under Rule 45 of the Rules of Civil
Procedure. All along the petitioner thought that the
filing of the petition for certiorari under Rule 65 is
appropriate considering that the ground raised is
grave abuse of discretion by the Honorable Court
of Appeals for reversing the decision of the
majority decision of the Panel of Voluntary
Arbitration in arbitrary and whimsical manner.
82|LabRel – Part IV-C
 10) For having treated this petition under
Rule 45 of the Rules of Civil Procedure, petitioner
humbly admits that delay was incurred in the filing
thereof, such delay was caused by several factors
beyond control such as the transfer of handling
legal assistant to another office and the
undersigned had to reassign the case for the
preparation of the petition. Furthermore, the
undersigned counsel, other than being the Chief
of FFW LEGAL CENTER is also the Vice
President of the Federation of Free Workers
(FFW), who has to attend similar and urgent
pressing problems of local affiliates arising from
the effects of contracting out and closure of
companies.
11) Considering the issue to be resolved
requires only two CBA provisions (1) the
recognition of management prerogative (Section 1,
Article III of the CBA), and union leave (Section
3, Article XV of the CBA) to guide the Honorable
Court reached (sic) a decision, petitioner honestly
thought that the other pleadings referred to by
respondent are not relevant.
With this kind and tenor of justification, we appear to
have acted with extreme liberality in recognizing the petition
as a Rule 45 petition and in giving it due course. We cannot
extend the same liberality, however, with respect to the
unions violation of the established rules on timelines in the
filing of petitions, which violations the company has kept
alive by its continuing objection. While we can be liberal in
Scroll No. 577
considering the mode of review of lower court decisions (and
even in the contents of the petition which the company insists
are deficient), we cannot do the same with respect to the time
requirements that govern the finality of these decisions. A
final judgment can no longer be disturbed under the combined
application of the principles of immutability of final
judgments[14] and res judicata,[15] subject only to very
exceptional circumstances not at all present in this case.[16]
Under Rule 45, a petition for review
on certiorari should be filed within 15 days from notice of
judgment, extendible in meritorious cases for a total of
another 30 days.[17] Given that a Rule 45 petition is
appropriate in the present case, the period of 60 days after
notice of judgment is way past the deadline allowed, so that
the CA decision had lapsed to finality by the time the petition
with us was filed. This reason alone even without considering
the companys other technical objection based on the unions
failure to attach relevant documents in support of the petition
amply supports the denial of the petition.
The lack of merit of the petition likewise precludes us
from resolving it in the unions favor. In short, we see no
reversible error in the CAs ruling.
83|LabRel – Part IV-C
 While it is true that the union and its members have
been granted union leave privileges under the CBA, the grant
cannot be considered separately from the other provisions of
the CBA, particularly the provision on management
prerogatives where the CBA reserved for the company the
full and complete authority in managing and running its
business.[18] We see nothing in the wordings of the union
leave provision that removes from the company the right to
prescribe reasonable rules and regulations to govern the
manner of availing of union leaves, particularly the
prerogative to require prior approval. Precisely, prior notice
is expressly required under the CBA so that the company can
appropriately respond to the request for leave. In this sense,
the rule requiring prior approval only made express what is
implied in the terms of the CBA.
In any event, any doubt in resolving any interpretative
conflict is settled by subsequent developments in the course
of the parties implementation of the CBA, specifically, by the
establishment of the company regulation in November 2002
requiring prior approval before the union leave can be used.
The union accepted this regulation without objection since its
promulgation (or more than a year before the present dispute
arose), and the rule on its face is not unreasonable,
oppressive, nor violative of CBA terms.Ample evidence
exists in the records indicating the unions acquiescence to the
rule.[19] Notably, no letter from the union complaining about
Scroll No. 577
the unilateral change in policy or any request for a meeting to
discuss this policy appears on record. The union and its
members have willingly applied for approval as the rule
requires.[20] Even Mangalino himself, in the past, had filed
applications for union leave with his department manager,
and willingly complied with the disapproval without protest
of any kind.[21] Thus, when Mangalino asserted his right to
take a leave without prior approval, the requirement for prior
approval was already in place and established, and could no
longer be removed except with the companys consent or by
negotiation and express agreement in future CBAs.
The prior approval policy fully supported the validity
of the suspensions the company imposed on Mangalino. We
point out additionally that as an employee, Mangalino had the
clear obligation to comply with the management disapproval
of his requested leave while at the same time registering his
objection to the company regulation and action. That he still
went on leave, in open disregard of his superiors orders,
rendered Mangalino open to the charge of insubordination,
separately from his
absence without official leave.[22] This charge, of course, can
no longer prosper even if laid today, given the lapse of time
that has since transpired.
In light of the petitions procedural infirmities,
particularly its late filing that rendered the CA decision final,
84|LabRel – Part IV-C
and the petitions lack of substantive merit, denial of the DECISION
petition necessarily follows.
CARPIO MORALES, J.:
WHEREFORE, premises considered, we DENY the Petitioner Juanito Tabigue and his 19 co-petitioners, all
petition for lack of merit. Costs against the petitioners. employees of respondent International Copra Export Corp-
oration (INTERCO), filed a Notice of Preventive Mediation
SO ORDERED. with the Department of Labor and Employment National
Conciliation and Mediation Board (NCMB), Regional Branch
No. XI, Davao City against respondent, for violation of
JUANITO TABIGUE, ALEX BIBAT, G.R. No. 183335 Collective Bargaining Agreement (CBA) and failure to sit on
JECHRIS DASALLA, ANTONIO
the grievance conference/meeting.[1]
TANGON, ROLANDO PEDRIGAL, Present:
DANTE MAUL, ALFREDO IDUL,
EDGAR RAMOS, RODERICK PUNO, C.J., Chairperson, As the parties failed to reach a settlement before the
JAVIER, NOEL PONAYO, ROMEL CARPIO MORALES,NCMB, petitioners requested to elevate the case to voluntary
ORAPA, REY JONE, ALMA PATAY, LEONARDO-DE CASTRO,
arbitration. The NCMB thus set a date for the parties to agree
JERIC BANDIGAN, DANILO BERSAMIN, and
JAYME, ELENITA S. BELLEZA, VILLARAMA, JR., on JJ.a Voluntary Arbitrator.
JOSEPHINE COTANDA, RENE DEL
MUNDO, PONCIANO ROBUCA, and Before the parties could finally meet, respondent
MARLON MADICLUM, Promulgated:
presented before the NCMB a letter[2] of Genaro Tan (Tan),
Petitioners, December 23, 2009
president of the INTERCO Employees/Laborers Union (the
- versus - union) of which petitioners are members, addressed to
respondents plant manager Engr. Paterno C. Tangente
INTERNATIONAL COPRA EXPORT
(Tangente), stating that petitioners are not duly authorized by
CORPORATION (INTERCO),
Respondent. [the] board or the officers to represent the union, [hence] . . .
x----------------------------------------- all actions, representations or agreements made by these
---------x people with the management will not be honored or

Scroll No. 577 85|LabRel – Part IV-C

recognized by the union. Respondent thus moved to dismiss
petitioners complaint for lack of jurisdiction.[3]
Petitioners soon sent union president Tan and
respondents plant manager Tangente a Notice to Arbitrate,
citing the Revised Guidelines in the Conduct of Voluntary
Arbitration Procedure vis a vis Section 3, Article XII of the
CBA, furnishing the NCMB with a copy[4] thereof, which
notice respondent opposed.[5]
The parties having failed to arrive at a
settlement,[6] NCMB Director Teodorico O. Yosores wrote
petitioner Alex Bibat and respondents plant manager
Tangente of the lack of willingness of both parties to submit
to voluntary arbitration, which willingness is a pre-requisite
to submit the case thereto; and that under the CBA forged by
the parties, the union is an indispensable party to a voluntary
arbitration but that since Tan informed respondent that the
union had not authorized petitioners to represent it, it would
be absurd to bring the case to voluntary arbitration.
The NCMB Director thus concluded that the demand of
[petitioners] to submit the issues . . . to voluntary arbitration
CAN NOT BE GRANTED. He thus advised petitioners to
avail of the compulsory arbitration process to enforce their
rights.[7]
Scroll No. 577
On petitioners Motion for Reconsideration,[8] the
NCMB Director, by letter of April 11, 2007 to petitioners
counsel, stated that the NCMB has no rule-making power to
decide on issues [as it] only facilitates settlement among the
parties to . . . labor disputes.
Petitioners thus assailed the NCMB Directors decision
via Petition for Review before the Court of Appeals[9] which
dismissed it by Resolution[10] of October 24, 2007 in this wise:
xxxx
Considering that NCMB is not a quasi-
judicial agency exercising quasi-judicial
functions but merely a conciliatory body for the
purpose of facilitating settlement of disputes
between parties, its decisions or that of its
authorized officer cannot be appealed either
through a petition for review under Rule 43 or
under Rule 65 of the Revised Rules of Court.
Further perusal of the petition reveals the
following infirmities:
1. Payment of the docket fees and other
legal fees is short by One Thousand
Pesos (Php 1,000.00);
2. Copy of the assailed Decision of the
Regional Director of the National
86|LabRel – Part IV-C
 Conciliation and Mediation Board INSTRUMENTALITIES,
has not been properly certified as the ARE APPEALABLE BY PETITION FOR
name and designation of the certifying REVIEW TO THE COURT OF
[17]
officer thereto are not indicated; and APPEALS. (emphasis in the original)

3. Not all of the petitioners named in the
petition signed the verification and
non-forum shopping.[11] (emphasis and
underscoring supplied)
Their Motion for Reconsideration[12] having been
denied,[13] petitioners filed the present Petition for Review on
Certiorari,[14] raising the following arguments:
LABOR CASES, AS A GENERAL RULE,
ARE NEVER RESOLVED ON THE BASIS OF
TECHNICALITY ESPECIALLY SO WHEN
SUBSTANTIAL RIGHTS OF EMPLOYEES
ARE AFFECTED.[18] (emphasis and underscoring
supplied)
The petition fails.

THIS PARTICULAR CASE XXX FALLS Section 7 of Rule 43 of the Rules of Court provides that
SQUARELY WITHIN THE PURVIEW
OF SECTION 6, RULE IV, IN RELATION TO [t]he failure of the petitioner to comply with
PARAGRAPH 3, SUB-PARAGRAPH 3.2, any of the foregoing requirements regarding the
SECTION 4, RULE IV, ALL OF THE REVISED payment of the docket and other lawful fees, the
PROCEDURAL GUIDELINES IN THE deposit for costs, proof of service of the petition,
CONDUCT OF VOLUNTARY ARBITRATION and the contents of and the documents which
PROCEEDINGS.[15] should accompany the petition shall be sufficient
ground for the dismissal thereof. (underscoring
THE NCMB, WHEN EXERCISING and emphasis supplied)
ADJUDICATIVE POWERS, ACTS AS A Petitioners claim that they had completed the payment of the
QUASI-JUDICIAL AGENCY.[16]
appellate docket fee and other legal fees when they filed their
FINAL JUDGMENTS, DECISIONS, motion for reconsideration before the Court of
RESOLUTIONS, ORDERS, OR AWARDS OF Appeals.[19] While the Court has, in the interest of justice,
REGIONAL TRIAL COURTS AND QUASI-
given due course to appeals despite the belated payment of
JUDICIAL BOARDS, LIKE THE NCMB,
COMMISSIONS, AGENCIES, those fees,[20] petitioners have not proffered any reason to call
Scroll No. 577 87|LabRel – Part IV-C
for a relaxation of the above-quoted rule. On this score alone,
the dismissal by the appellate court of petitioners petition is in
order.
But even if the above-quoted rule were relaxed, the
appellate courts dismissal would just the same be
sustained. Under Section 9 (3) of the Judiciary Reorganization
Act of 1980,[21] the Court of Appeals exercises exclusive
appellate jurisdiction over all final judgments, decisions,
resolutions, orders or awards of Regional Trial Courts
and quasi-judicial agencies, instrumentalities, boards or
commissions.
Rule 43 of the Rules of Court under which petitioners
filed their petition before the Court of Appeals[22] applies to
awards, judgments, final orders or resolutions of or authorized
by any quasi-judicial agency in the exercise of its quasi-
judicial functions.[23]
A[n agency] is said to be exercising judicial
function where [it] has the power to determine
what the law is and what the legal rights of the
parties are, and then undertakes to determine these
questions and adjudicate upon the rights of the
parties. Quasi-judicial function is a term which
applies to the action, discretion, etc. of public
administrative officers or bodies, who are required
to investigate facts or ascertain the existence of
facts, hold hearings, and draw conclusions from
Scroll No. 577
them as a basis for their official action and to
exercise discretion of a judicial
[24]
nature. (underscoring supplied)
Given NCMBs following functions, as enumerated in Section
22 of Executive Order No. 126 (the Reorganization Act of the
Ministry of Labor and Employment), viz:
(a) Formulate policies, programs, standards,
procedures, manuals of operation and
guidelines pertaining to effective mediation
and conciliation of labor disputes;
(b) Perform preventive mediation and conciliation
functions;
(c) Coordinate and maintain linkages with other
sectors or institutions, and other government
authorities concerned with matters relative to
the prevention and settlement of labor
disputes;
(d) Formulate policies, plans, programs, standards,
procedures, manuals of operation and
guidelines pertaining to the promotion of
cooperative and non-adversarial schemes,
grievance handling, voluntary arbitration and
other voluntary modes of dispute settlement;
(e) Administer the voluntary arbitration program;
maintain/update a list of voluntary
arbitrations; compile arbitration awards and
decisions;
88|LabRel – Part IV-C

(f) Provide counseling and preventive mediation
assistance particularly in the administration of
collective agreements;
(g) Monitor and exercise technical supervision
over the Board programs being implemented
in the regional offices; and
(h) Perform such other functions as may be
provided by law or assigned by the Minister,
it can not be considered a quasi-judicial agency.
Respecting petitioners thesis that unsettled grievances
should be referred to voluntary arbitration as called for in the
CBA, the same does not lie. The pertinent portion of the CBA
reads:
In case of any dispute arising from the
interpretation or implementation of this Agreement
or any matter affecting the relations of Labor and
Management, the UNION and the COMPANY
agree to exhaust all possibilities of conciliation
through the grievance machinery. The committee
shall resolve all problems submitted to it within
fifteen (15) days after the problems ha[ve] been
discussed by the members. If the dispute or
grievance cannot be settled by the Committee, or if
the committee failed to act on the matter within the
period of fifteen (15) days herein stipulated,
Scroll No. 577
the UNION and the COMPANY agree to submit
the issue to Voluntary Arbitration. Selection of the
arbitrator shall be made within seven (7) days from
the date of notification by the aggrieved party. The
Arbitrator shall be selected by lottery from four (4)
qualified individuals nominated by in equal
numbers by both parties taken from the list of
Arbitrators prepared by the National Conciliation
and Mediation Board (NCMB). If the Company
and the Union representatives within ten (10) days
fail to agree on the Arbitrator, the NCMB shall
name the Arbitrator. The decision of the Arbitrator
shall be final and binding upon the
parties. However, the Arbitrator shall not have the
authority to change any provisions of the
Agreement. The cost of arbitration shall be borne
equally by the parties.[25] (capitalization in the
original, underscoring supplied)
Petitioners have not, however, been duly authorized to
represent the union. Apropos is this Courts pronouncement
in Atlas Farms, Inc. v. National Labor Relations
Commission,[26] viz:
x x x Pursuant to Article 260 of the Labor
Code, the parties to a CBA shall name or designate
their respective representatives to the grievance
machinery and if the grievance is unsettled in that
level, it shall automatically be referred to the
voluntary arbitrators designated in advance by
parties to a CBA. Consequently only disputes
involving the union and the company shall be
89|LabRel – Part IV-C
 referred to the grievance machinery or voluntary SO ORDERED.
arbitrators.[27] (emphasis and underscoring
supplied)

Clutching at straws, petitioners invoke the first

paragraph of Article 255 of the Labor Code which states:

Art. 255. The labor organization designated

or selected by the majority of the employees in an
appropriate collective bargaining unit shall be the
exclusive representative of the employees in such
unit for the purpose of collective
bargaining. However, an individual employee or
group of employees shall have the right at any time
to present grievances to their employer.
x x x x (emphasis and underscoring
supplied)

To petitioners, the immediately quoted provision is meant to

be an exception to the exclusiveness of the representative role
of the labor organization/union.[28]

This Court is not persuaded. The right of any employee

or group of employees to, at any time, present grievances to
the employer does not imply the right to submit the same to
voluntary arbitration.

WHEREFORE, the petition is DENIED.

Scroll No. 577 90|LabRel – Part IV-C