G.R. No.

L-47775 July 5, 1980

JULIAN DUYAG, ARMANDO OLIVARES, JOSE ECHEVARIA, ALEJANDRO SEVILLA and
FELIMON GUINGON, petitioners,
vs.
HON. AMANDO G. INCIONG, as Acting Director of Labor Relation CARMELO C. NORIEL, as
Director of Labor Relations, RICA R. MANALAD, HONORATO K. LEANO, EDUARDO AMPARO
and SANTOS PUERTO,respondents.
AQUINO, J.:
This case is about the removal of private respondents as union officers due to alleged irregularities
and anomalies in the administration of the affairs of the union.
On January 14, 1977, the five petitioners, who are arrastre checkers of E. Razon, Inc. in the South
Harbor, Port Area, Manila as well as bona fide members of the Associated Port Checkers and
Workers Union, filed with Regional Office No. 4 of the Department of Labor a complaint containing
several charges against the four private respondents, who, respectively, are the president (for more
than twenty years), treasurer, vice-president and auditor of the union.
The record reveals the following facts, some of which are admitted or not denied by the private
respondents, whiny the other facts are supported by substantial evidence which is summarized in
the decisions of the med-arbiter and the Director of Labor Relations:
Unauthorized increases in union dues.
Withholding of union members' share in the profits amounting to P18,640.09.
Disbursements exceeding P500 which were not authorized by the board of directors.
Maladministration of welfare fund.
Membership in another union.
Conflict of interest on the part of Manalad.
Under these facts, the med-arbiter in his decision of August 29, 1977 ordered the removal of the
private respondents as officers of the union and directed them to reimburse to the members thereof
the amounts illegally collected from them.
On appeal, the Director held that resort to intra-union remedies is not necessary and that the five
complainants have the rights and personality to institute the proceedings for the removal of the
respondents, to recover the amount illegally collected or withheld from them and to question illegal
disbursements and expenditure of union funds.
However, the Director ruled that the power to remove the union officers rests in the members and
that the Bureau of Labor Relations generally has nothing to do with the tenure of union officers which
"is a political question".
The Director further ruled that his office has jurisdiction to look into the charge of illegal
disbursements of union funds. He directed the Labor Organization Division of the Bureau to examine
the books of account and financial records of the union and to submit a report on such examination.
Hence, this case

ISSUE: Whether the director of labor relations can order the examination
of the books
HELD: Yes, the Director acted correctly in ordering an examination of the books and records of
the union. The examination should include a verification of the charge that the petty loans extended
by the union to its members were usurious and that the fee for the issuance of cheeks is
unwarranted since the loans were made in cash.

G.R. No. 85333 February 26, 1990

CARMELITO L. PALACOL, ET AL., petitioners,
vs.
PURA FERRER-CALLEJA, Director of the Bureau of Labor Relations, MANILA CCBPI SALES FORCE UNION, and COCACOLA BOTTLERS (PHILIPPINES), INC., respondents.
GANCAYCO, J.:

On October 12, 1987, the respondent Manila CCBPI Sales Force Union (hereinafter referred to as
the Union), as the collective bargaining agent of all regular salesmen, regular helpers, and relief
helpers of the Manila Plant and Metro Manila Sales Office of the respondent Coca-Cola Bottlers
(Philippines), Inc. (hereinafter referred to as the Company) concluded a new collective bargaining
agreement with the latter. Among the compensation benefits granted to the employees was a
general salary increase to be given in lump sum including recomputation of actual commissions
earned based on the new rates of increase.
As embodied in the Board Resolution of the Union dated September 29, 1987, the purpose of the
special assessment sought to be levied is "to put up a cooperative and credit union; purchase
vehicles and other items needed for the benefit of the officers and the general membership; and for
the payment for services rendered by union officers, consultants and others." There was also an
additional proviso stating that the "matter of allocation ... shall be at the discretion of our incumbent
Union President."
This "Authorization and CBA Ratification" was obtained by the Union through a secret referendum
held in separate local membership meetings on various dates. The total membership of the Union
was about 800. Of this number, 672 members originally authorized the 10% special assessment,
while 173 opposed the same. However, 355 member withdraw or disauthorize the special
assessment which turns the tide unfavorable to such. Resulting to disauthorization of the special
assessment. Petitioners assailed the 10% special assessment as a violation of Article 241(o) in
relation to Article 222(b) of the Labor Code.
Med-Arbiter Manases T. Cruz ruled in favor of whereby he directed the Company to remit the amount
it had kept in trust directly to the rank-and-file personnel without delay.
On appeal to the Bureau of Labor Relations, however, the order of the Med-Arbiter was reversed
and set aside by the respondent-Director in a resolution dated August 19, 1988 upholding the claim
of the Union that the special assessment is authorized under Article 241 (n) of the Labor Code, and
that the Union has complied with the requirements therein.
Hence, the instant petition.
ISSUE: Can a special assessment be validly deducted by a labor union from the lump-sum pay of its
members, granted under a collective bargaining agreement (CBA), notwithstanding a subsequent
disauthorization of the same by a majority of the union members?
HELD; NO, the failure of the Union to comply strictly with the requirements set out by the law
invalidates the questioned special assessment. Substantial compliance is not enough in view of the
fact that the special assessment will diminish the compensation of the union members. Their express
consent is required, and this consent must be obtained in accordance with the steps outlined by law,
which must be followed to the letter. No shortcuts are allowed.

ART. 241. Rights and conditions of membership in a labor organization.

xxx xxx xxx
(n) No special assessment or other extraordinary fees may be levied upon the
members of a labor organization unless authorized by a written resolution of a

majority of all the members at a general membership meeting duly called for the
purpose. The secretary of the organization shall record the minutes of the meeting
including the list of all members present, the votes cast, the purpose of the special
assessment or fees and the recipient of such assessments or fees. The record shall
be attested to by the president;
The instant petition is GRANTED. The Order of the Director of the Bureau of Labor Relations is SET
ASIDE, while the order of the Med-Arbiter dated February 17, 1988 is reinstated, and the respondent
Coca-Cola Bottlers (Philippines), Inc. is hereby ordered to immediately remit the amount of
P1,267,863.39 to the respective union members from whom the said amount was withheld. No
pronouncement as to costs. This decision is immediately executory.

[G.R. No. 106518. March 11, 1999]

ABS CBN SUPERVISORS EMPLOYEE UNION MEMBERS, petitioner, vs. ABS CBN
BROADCASTING CORP., HERBERT RIVERA, ALBERTO BERBON, CINDY MUNOZ, CELSO JAMBALOS,

SALVADOR DE VERA, ARNULFO ALCAZAR, JAKE MADERAZO, GON CARPIO, OSCAR LANDRITO,
FRED GARCIA, CESAR LOPEZ and RUBEN BARRAMEDA, respondents.
PURISIMA, J.:

On December 7, 1989, the ABS-CBN Supervisors Employees Union (the Union),

represented by respondent Union Officers, and ABS-CBN Broadcasting Corporation (the
Company) signed and concluded a Collective Bargaining Agreement with the following checkoff provision, to wit:
Article XII The company agrees to advance to the Union a sum equivalent to 10% of the sum
total of all the salary increases and signing bonuses granted to the Supervisors under this
collective Bargaining Agreement and upon signing hereof to cover the Unions incidental
expenses, including attorneys fees and representation expenses for its organization
and (sic) preparation and conduct hereof, and such advance shall be deducted from the benefits
granted herein as they accrue.
On September 19, 1990, Petitioners filed with the Bureau of Labor Relations, DOLE-NCR,
Quezon City, a Complaint against the Union Officers and ABS-CBN Broadcasting corporation,
praying that (1) the special assessment of ten percent (10%) of the sum total of all salary
increases and signing bonuses granted by respondent Company to the members of the Union be
declared illegal for failure to comply with the labor Code, as amended, particularly Article 241,
paragraphs (g), (n), and (o); and in utter violation of the Constitution and By-Laws of the ABSCBN Supervisors Employees Union; (2) respondent Company be ordered to suspend further
deductions from petitioners salaries for their shares thereof.
In their Answers, respondent Union Officers and Company prayed for the dismissal of the
Complaint for lack of merit. They argued that the check-off provision is in accordance with law
as majority of the Union members individually executed a written authorization giving the Union
officers and the Company a blanket authority to deduct subject amount.
On January 21, 1991, Med-Arbiter Rasidali C. Abdula ruled in favor of the petitioners
herein, on appeal, respondent DOLE Undersecretary Bienvenido E. Laguesma handed down a
decision affirming in toto the decision of the med-arbiter, but later on set aside its decision,
dismissing the case for lack of merit.
Petitioners argued that the check-off provision in question is illegal because it was never
submitted for consideration and approval to "all the members at a general membership meeting
called for the purpose"; and further alleged that the formalities mandated by Art. 241, paragraphs
(n) and (o) of the Labor Code, as amended, were not complied with.
ISSUE: whether the check-off is valid?
HELD:
YES, A check-off is a process or device whereby the employer, on agreement with the Union,
recognized as the proper bargaining representative, or on prior authorization from its
employees, deducts union dues or agency fees from the latter's wages and remits them directly to
the union. Its desirability in a labor organization is quite evident. It is assured thereby of
continuous funding. As this Court has acknowledged, the system of check-off is primarily for
the benefit of the Union and only indirectly, for the individual employees.
The legal basis of check-off is found in statutes or in contracts. The statutory limitations on
check-offs are found in Article 241, Chapter II, Title IV, Book Five of the Labor Code

Noticeably, Article 241 speaks of three (3) requisites that must be complied with in order
that the special assessment for Union's incidental expenses, attorney's fees and representation
expenses, as stipulated in Article XII of the CBA, be valid and upheld namely: 1) authorization
by a written resolution of the majority of all the members at the general membership meeting
duly called for the purpose; (2) secretary's record of the minutes of the meeting;
and (3) individual written authorization for check-off duly signed by the employee concerned.
After a thorough review of the records on hand, we find that the three (3) requisites for the
validity of the ten percent (10%) special assessment for Union's incidental expenses, attorney's
fees and representation expenses were met.
ABS-CBN Supervisors Employee Union held its general meeting, whereat it was agreed that
a ten percent (10%) special assessment from the total economic package due to every member
would be checked-off to cover expenses for negotiation, other miscellaneous expenses and
attorney's fees. The minutes of the said meeting were recorded by the Union's Secretary, Ma.
Carminda M. Munoz, and noted by its President, Herbert Rivera.
On May 24, 1991, said Union held its General Membership Meeting, wherein majority of
the members agreed that "in as much as the Union had already paid Atty. P. Pascual the amount
of P500,000.00, the same must be shared by all the members until this is fully liquidated."
Eighty-five (85) members of the same Union executed individual written authorizations for
check-off, Records do not indicate that the aforesaid check-off authorizations were executed
under the influence of force or compulsion and the amount is not fixed, it is determinable.