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G.R. No.

L-33705 April 15, 1977


AIR LINE PILOTS ASSOCIATION OF THE PHILIPPINES (GASTON GROUP), petitioner, vs.
THE COURT OF INDUSTRIAL RELATIONS and AIR LINES PILOTS ASSOCIATION OF THE
PHILIPPINES (GOMEZ GROUP), respondents

Facts:
These are two petitions for certiorari (L-33705 and L-35206), consolidated for purposes of
decision because they involve more or less the same parties and interlocking issues.

L-33705
On January 2, 1971, the ALPAP, represented by Capt. Gomez, who claimed to be its
president, filed a petition with CIR praying for certification as the sole and exclusive collective
bargaining representative of "all the pilots now under employment by the Philippine Air Lines, Inc,
and are on active flight and/or operational assignments." This was opposed by Capt. Gaston who
also claimed to be the president alleging that CIR had no jurisdiction over the subject matter
because a certification proceeding in the Court of Industrial Relations is not the proper forum for
the adjudication of the question as to who is the lawful president of a legitimate labor
organization. The Judge thereafter ruled in favor of Gomez.

ALPAP then held a meeting where 221 of the 270 members adopted a resolution
amending ALPAPs constitution and by-laws by providing in a new section thereof that
Any active member who shall be forced to retire or forced to resign or otherwise terminated for
union activities as solely determine' by the Association shall have the option to either continue to
be and remain as an active member in good standing or to resign in writing his active
membership with the Association.

Gaston then said that the amendment was adopted "In anticipation on the fact that they
may be forced to resign or retire because of their 'union activities.' A majority of ALPAP members
filed letters of retirement/ resignation from PAL. Thereafter, an election for officers was held
resulting to the election of Gaston as president. Those however, who did not tender resignation
voted for Gomez as president.

On June 3, 1971, ALPAP (Gaston) filed an opposition in Case 101-IPAB to an urgent ex parte
motion of the PAL to enjoin the members of ALPAP from retiring or resigning en masse. It claimed
that they sought for reinstatement and that their filing of resignations is a valid exercise of their
constitutional rights and they could not be deprived of their benefits. The opposition however was
denied.

L-35206
A labor dispute was certified by the President of the Philippines between ALPAP and PAL
and was assigned to Judge Paredes. After conferring with the parties, the Judge issued a returnto-work order, which ordered ALPAP members to return to work and ordered PAL not to suspend
or dismiss any employee as result of the strike and failure to comply to the said order shall result
to contempt of court. The employees then returned to work but Gaston, however, did not and it
resulted to his termination.
PAL then filed an urgent motion with the CIR to enjoin the members of ALPAP from
proceeding with their intention to resign/ retire en masse. The judge then issued an order to
ALPAP not to strike otherwise they will be terminated. ALPAP then filed an MR alleging that such
order subjects them to involuntary servitude. Their MR was denied.
It then resulted to mass resignation and PAL accepted such and the caveat pilots who
retired were no longer entitled to benefits as the Pilots acts constituted a violation of the courts
order not to strike. Gomez then filed a petition to allow him to represent ALPAP since those who
voted for Gaston has already resigned. Gaston and the pilots who resigned then prayed to the
CIR that they be reinstated. This was opposed by Gomez and PAL but the judge ordered a
dismissal of their opposition and ordered the reinstatement. The CIR however reversed the order
of Judge Paredes on the ground that the question of the employee status of the pilots who were
seeking reinstatement with PAL has already been raised squarely in Case 2939-MC and resolved
by the said tribunal found that the said pilots have already lost their employee status as a
consequence of their resignations and/or retirement from PAL which had been duly accepted by
the latter.
Issue: WON the authorization given by the industrial court to ALPAP (Gomez), in a certification
proceeding to take over the corporate name, office and funds of ALPAP is valid.

Held:
No. We have made a careful examination of the records of L-33705 and we find the
adoption of the resolution introducing the questioned amendment to be substantial compliance
with the ALPAP constitution and by-law. Indeed, there is no refutation of the act that 221 out of the
270 members of ALPAP did cast their votes in favor of the said amendment on October 30, 1970
at the ALPAP general membership meeting.
Their Court cannot likewise subscribe to the restrictive interpretation made by the court below of
the term "labor organization," which Section 2(e) of R.A. 875 defines as any union or
association of employees which exist, in whole or in part, for the purpose of the collective
bargaining or dealing with employers concerning terms and conditions of employment." The
absence of the condition that the court would attach to the statutory concept of a labor
organization, as being limited to the employees of particular employer, is quite evident from the
law. The emphasis of Industrial Peace Act is clearly on the purposes for which a union or
association of employees established rather than that membership therein should be limited only
to the employees of a particular employer. Trite to say, under Section 2(h) of R.A 875
"representative" is define as including "a legitimate labor organization or any officer or agent of

such organization, whether or not employed by the employer or employee whom he represents."
It cannot be overemphasized likewise that labor dispute can exist "regardless of whether the
disputants stand in the proximate relation of employer and employee. (Section 2(j), R.a. 875).
There is, furthermore, nothing in the constitution and by-laws of ALPAP which indubitably restricts
membership therein to PAL pilots alone. 1 Although according to ALPAP (Gomez) there has never
been an instance when a non-PAL pilot became a member of ALPAP, the complete lack of any
such precondition for ALPAP membership cannot but be interpreted as an unmistakable authority
for the association to accept pilots into its fold though they may not be under PAL's employ.
The fundamental assumptions relied upon by the industrial court as bases for authorizing ALPAP
(Gomez) to take over the office and funds of ALPAP being, in this Court's opinion, erroneous, and,
in the absence of any serious dispute that on December 18-22, 1970 Felix C. Gaston, and four
other pilots, were elected by the required majority of ALPAP members as officers of their
association, this Court hereby rules that the mentioned authorization to ALPAP (Gomez) to take
over the office, funds and name of ALPAP was done with grave abuse of discretion.
DUNLOP SLAZENGER (PHILS.), INC., petitioner, vs. HON. SECRETARY OF LABOR AND
EMPLOYMENT
and
DUNLOP
SLAZENGER
STAFF
ASSOCIATION
APSOTEU, respondents.
DECISION
PUNO, J.:
In this petition for certiorari under Rule 65 of the 1997 Rules of Civil Procedure, petitioner seeks the
annulment of the Resolution and Order, dated July 19, 1997 and October 16, 1997, [1] of the public
respondent Secretary of Labor and Employment calling for a certification election in its company.
It appears that on September 15, 1995, the respondent union filed a Petition for Certification Election
among the supervisory, office and technical employees of the petitioner company before the Department of
Labor and Employment, Regional Office No. III, San Fernando, Pampanga. It alleged that it is a legitimate
labor organization, a duly chartered local of the Associated Professional, Supervisory, Office & Technical
Employees Union (APSOTEU); that petitioner is a domestic corporation engaged in the manufacture of
tennis balls and other allied products; that petitioner is an unorganized establishment and there is no
certified bargaining agreement that will bar the filing of its petition for certification election; and that no
certification election has been conducted within one (1) year prior to the filing of its petition for
certification election.
On October 9, 1995, the petitioner company filed its Answer with Motion to Dismiss based on three
(3) grounds, namely: (1) that the respondent union is comprised of supervisory and rank-and-file
employees and cannot act as bargaining agent for the proposed unit; (2) that a single certification election
cannot be conducted jointly among supervisory and rank-and-file employees; and (3) that the respondent
union lacks legal standing since it failed to submit its books of accounts. [2]
In its Reply filed on December 5, 1995, the respondent union alleged that its members are supervisors
and not rank-and-file employees. It averred that all its members are paid monthly by the petitioner
company. It alleged that the bargaining unit it seeks to represent is made up of the monthly paid
supervisory employees and other personnel who cannot be classified as belonging to the rank-and-file. It
further contended that it has no obligation to attach its books of accounts since it is a legitimate labor
organization. It urged that the certification election proceeding cannot be used to question the legal
personality of a labor organization. [3] On March 4, 1996, however, respondent union submitted its new
books of accounts consisting of the Cash Receipts Journal, Cash Disbursements Journal and two (2)
ledgers.[4]

On July 15, 1996, Mediator Arbiter Ma. Carmen A. Espinosa granted the petition for certification
election. Respondent Secretary of Labor and Employment affirmed the Arbiter's decision ruling as follows:
"x x x
"The order of the Med-Arbiter directing the conduct of a certification elections is well and proper.
"A perusal of the records shows that the bargaining unit that the petitioner seeks to represent has been
properly defined and this is composed of all the supervisory employees of the respondent company. We
wish to emphasize that the right of supervisory employees to form their own labor organization separate
from that of the rank-and-file union has been recognized by law. This is quite clear from the provisions of
Article 245 of the Labor Code, as amended, which states:
`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.'
"As to the contention of the respondent that the petitioning union is composed of both supervisory and rank
and file employees, suffice it to stress that the same is not a sufficient reason that would warrant the
dismissal of the present petition. The same can be taken care (sic) of during the pre-election conference
thru the exclusion-inclusion proceedings wherein those employees who are occupying rank and file
positions will be excluded from the list of eligible voters.
"Anent the issue on the legitimacy of the petitioner, we agree with the findings of the Med-Arbiter that the
petitioner has acquired the requisite legal personality to file the present petition for certification
elections. This is shown by the fact that the petitioner has sufficiently complied with the mandatory
reportorial requirements provided for under Section 3, Rule II, Book V of the Rules and Regulations
Implementing the Labor Code, as amended and as enunciated by the Supreme Court in the cases of
Progressive Development Corporation vs. Secretary of Labor, et al., 205 SCRA 802 and Protection
Technology Inc. vs. Secretary of Labor, G.R. 11711, March 1, 1995."[5]
Respondent Secretary of Labor denied petitioner's motion for reconsideration; hence, this petition.
It is petitioner's submission that:
"I
"Respondent Secretary acted arbitrarily and with grave abuse of discretion amounting to lack or excess of
jurisdiction in holding that the respondent union is composed of all the supervisory employees of the
[petitioner] company.
"II
"Respondent Secretary acted arbitrarily and with grave abuse of discretion amounting to lack or excess of
jurisdiction in finding that even if the respondent union is composed of both supervisory and rank-and-file
employees such can be taken cared of during the pre-election conference thru the exclusion-inclusion
proceedings.
"III

"Respondent Secretary acted contrary to law and with grave abuse of discretion amounting to lack or
excess of jurisdiction in upholding the findings of the Med-Arbiter that the respondent union has complied
with all the requirements for it to attain the legal personality to file the petition for certification election." [6]
The petition is meritorious.
We agree with the public respondent that supervisors can be an appropriate bargaining unit. This is in
accord with our repeated ruling that "[a]n appropriate bargaining unit is a group of employees of a given
employer, composed of all or less than the entire body of employees, which the collective interests of all
the employees, consistent with equity to the employer, indicate to be best suited to serve reciprocal rights
and duties of the parties under the collective bargaining provisions of law. Otherwise stated, it is a legal
collectivity for collective bargaining purposes whose members have substantially mutual bargaining
interests in terms and conditions of employment as will assure to all employees their collective bargaining
rights. 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."[7]
The critical issue, however, is whether or not the respondent union can file a petition for certification
election to represent the supervisory employees of the petitioner company. The resolution of this issue
depends on whether the respondent union is composed solely of supervisory employees or of both
supervisory and rank-and-file employees. Article 245 of the Labor Code clearly provides that "supervisory
employees shall not be eligible for membership in a labor organization of the rank-and-file employees x x
x."
To determine who are supervisory and rank-and-file employees reference has to be made to Article
212 (m) of the Labor Code, as amended, as well as Section 1 (t), Rule I, Book V of the Omnibus Rules
Implementing the Labor Code, as amended, viz:
'''Managerial employee is one who is vested with powers or prerogatives to lay down and execute
management policies and/or to hire, transfer, suspend, layoff, recall, discharge, assign or discipline
employees. Supervisory employees are those who, in the interest of the employer, effectively
recommend such managerial actions if the exercise of such authority is not merely routinary or
clerical in nature but requires the use of independent judgment. All employees not falling within any
of the above definitions are considered rank-and-file employees for purposes of this Book [these
Rules].'"
Determining the status of supervisory and rank-and-file employees is not a hard row to hoe in labor
law. The test of supervisory status as we have repeatedly ruled is whether an employee possesses authority
to act in the interest of his employer, which authority should not be merely routinary or clerical in nature
but requires the use of independent judgment. Corrollarily, what determines the nature of employment is
not the employee's title, but his job description.[8]
In the instant case, the list of monthly paid employees submitted by the petitioner company contains
the names of about twenty seven (27) supervisory employees, six (6) managerial employees, one (1)
confidential employee and twenty six (26) office and technical employees holding various positions. The
list reveals that the positions occupied by the twenty six (26) office and technical employees are in
fact rank-and-file positions, i.e., A/C mechanic, draftsmen, storemen, motorpool mechanic,
secretaries, accounts clerk, company nurses, industrial mechanic, boiler men, laboratory technicians,
payroll clerk, welder, purchasing clerk, company drivers and electricians. It is fairly obvious that
these positions cannot be considered as supervisory positions for they do not carry the authority to act in
the interest of the employer or to recommend managerial actions. It is not decisive that these employees
are monthly paid employees. Their mode of compensation is usually a matter of convenience and does not
necessarily determine the nature and character of their job.
We also do not agree with the ruling of the respondent Secretary of Labor that the infirmity in the
membership of the respondent union can be remedied in "the pre-election conference thru the exclusioninclusion proceedings wherein those employees who are occupying rank-and-file positions will be excluded
from the list of eligible voters." Public respondent gravely misappreciates the basic antipathy between the

interest of supervisors and the interest of rank-and-file employees. Due to the irreconcilability of their
interests we held in Toyota Motor Philippines v. Toyota Motors Philippines Corporation Labor Union,
[9]
viz:
"x x x
"Clearly, based on this provision [Article 245, Labor Code], a labor organization composed of both rankand-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 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."
Needless to stress, the respondent union has no legal right to file a certification election to represent a
bargaining unit composed of supervisors for so long as it counts rank-and-file employees among its
members.
IN VIEW WHEREOF, the Resolution and Order dated July 19, 1997 and October 16, 1997, in OSA-10-171-96 of the public respondent are annulled and set aside. No costs.
SO ORDERED.
CEBU SEAMANS V CALLEJA
Facts: A group of deck officers and marine engineers organized themselves into an association
and registered the same as a non-stock corporation known as Cebu Seaman's Association, Inc.
(CSAI) with the Securities and Exchange Commission (SEC). The same group subsequently
registered its association with the Bureau of Labor Relations as a labor union known as the
Seamen's Association of the Philippines, Incorporated (SAPI).

SAPI has an existing collective bargaining agreement (CBA) with Aboitiz Shipping Corporation
which remitted checked-off dues to SAPI. Later on, a group of union members headed by Manuel
Gabayoyo claimed that they are entitled to the custody of the union dues because they were
elected as the new set of officers under the supervision of SEC. Another group headed by
Dominica Nacua, claiming that they were the duly elected set of officers of the union and
therefore entitled to the union dues, filed a complaint to restrain the group of Gabayoyo from
representing the union. CSAI represented by the Gabayoyo group, however, claimed that since
Nacua was already expelled as officer/member, she has no personality to represent the union.

Issue: Whether or not Seamen's Association of the Philippines is a legitimate labor organization,
and therefore entitled to the custody of the union dues

Held: No. CSAI is not a legitimate labor organization because it is only registered with SEC. It is
the registration of the organization with the Bureau of Labor Relations and not with the SEC
which made it a legitimate labor organization with rights and privileges granted under the Labor
Code.

On the basis of the evidence presented by the parties, SAPI, the legitimate labor union,
registered with its office, is not the same association as CSAI, the corporation, insofar as their
rights under the Labor Code are concerned. Hence, SAPI and not the CSAI is entitled to the
release and custody of union fees with Aboitiz Shipping and other shipping companies with whom
it had an existing CBA.

The election of the so-called set of officers headed by Manuel Gabayoyo was conducted under
the supervision of the SEC. That being the case, the aforementioned set of officers is of the CSAI
and not of SAPI. It follows, then, that any proceedings, and actions taken by said set of officers
can not, in any manner, affect the union and its members.
G.R. No. 96425 February 4, 1992
PROGRESSIVE DEVELOPMENT CORPORATION, petitioner,
vs.
THE HONORABLE SECRETARY, DEPARTMENT OF LABOR AND EMPLOYMENT, MEDARBITER EDGARDO DELA CRUZ and PAMBANSANG KILUSAN NG PAGGAWA (KILUSAN)TUCP, respondents.
Beltran, Bacungan & Candoy for petitioner.
Jimenez & Associates co-counsel for petitioner.

GUTIERREZ, JR., J.:
The controversy in this case centers on the requirements before a local or chapter of a federation
may file a petition for certification election and be certified as the sole and exclusive bargaining
agent of the petitioner's employees.
Petitioner Progressive Development Corporation (PDC) filed this petition for certiorari to set aside
the following:
1) Resolution dated September 5, 1990, issued by respondent Med-Arbiter Edgardo dela Cruz,
directing the holding of the certification election among the regular rank-and-file employees of
PDC:
2) Order dated October 12, 1990, issued by the respondent Secretary of Labor and Employment,
denying PDC's appeal; and

3) Order dated November 12, 1990, also issued by the respondent Secretary, denying the
petitioner's Motion for Reconsideration.
On June 19, 1990, respondent Pambansang Kilusan ng Paggawa (KILUSAN) -TUCP (hereinafter
referred to as Kilusan) filed with the Department of Labor and Employment (DOLE) a petition for
certification election among the rank-and-file employees of the petitioner alleging that it is a
legitimate labor federation and its local chapter, Progressive Development Employees Union, was
issued charter certificate No. 90-6-1-153. Kilusan claimed that there was no existing collective
bargaining agreement and that no other legitimate labor organization existed in the bargaining
unit.
Petitioner PDC filed its motion to dismiss dated July 11, 1990 contending that the local union
failed to comply with Rule II Section 3, Book V of the Rules Implementing the Labor Code, as
amended, which requires the submission of: (a) the constitution and by-laws; (b) names,
addresses and list of officers and/or members; and (c) books of accounts.
On July 16 , 1990, respondent Kilusan submitted a rejoinder to PDC's motion to dismiss claiming
that it had submitted the necessary documentary requirements for registration, such as the
constitution and by-laws of the local union, and the list of officers/members with their addresses.
Kilusan further averred that no books of accounts could be submitted as the local union was only
recently organized.
In its "Supplemental Position Paper" dated September 3, 1990, the petitioner insisted that upon
verification with the Bureau of Labor Relations (BLR), it found that the alleged minutes of the
organizational meeting was unauthenticated, the list of members did not bear the corresponding
signatures of the purported members, and the constitution and by-laws did not bear the signature
of the members and was not duly subscribed. It argued that the private respondent therefore
failed to substantially comply with the registration requirements provided by the rules. Additionally,
it prayed that Med-Arbiter Edgardo dela Cruz inhibit himself from handling the case for the reason
that he allegedly had prejudged the same.
In his September 5, 1990 resolution, Med Arbiter dela Cruz held that there was substantial
compliance with the requirements for the formation of the chapter. He further stated that mere
issuance of the charter certificate by the federation was sufficient compliance with the rules.
Considering that the establishment was unorganized, he maintained that a certification election
should be conducted to resolve the question of representation.
Treating the motion for reconsideration filed by the PDC as an appeal to the Office of the
Secretary, Undersecretary Laguesma held that the same was merely a "reiteration of the issues
already ventilated in the proceedings before the Med-Arbiter, specifically, the matter involving the
formal organization of the chapter." (Rollo, p. 20) PDC's motion for reconsideration from the
aforementioned ruling was likewise denied. Hence, this petition.
In an order dated February 25, 1991, the Court resolved to issue a temporary restraining order
enjoining the public respondents from carrying out the assailed resolution and orders or from
proceeding with the certification election. (Rollo, pp. 37-39)
It is the petitioner's contention that a labor organization (such as the Kilusan) may not validly
invest the status of legitimacy upon a local or chapter through the mere expedient of issuing a
charter certificate and submitting such certificate to the BLR (Rollo, p. 85) Petitioner PDC posits
that such local or chapter must at the same time comply with the requirement of submission
of duly subscribed constitution and by-laws, list of officers and books of accounts. (Rollo, p. 35)
PDC points out that the constitution and by-laws and list of officers submitted were not duly
subscribed. Likewise, the petitioner claims that the mere filing of the aforementioned documents

is insufficient; that there must be due recognition or acknowledgment accorded to the local or
chapter by BLR through a certificate of registration or any communication emanating from it.
(Rollo, p. 86)
The Solicitor General, in behalf of the public respondent, avers that there was a substantial
compliance with the requirements for the formation of a chapter. Moreover, he invokes Article 257
of the Labor Code which mandates the automatic conduct by the Med-Arbiter of a certification
election in any establishment where there is no certified bargaining agreement.
The Court has repeatedly stressed that the holding of a certification election is based on a
statutory policy that cannot be circumvented. (Airtime Specialists, Inc. v. Ferrer-Calleja, 180
SCRA 749 [1989]; Belyca Corporation v. Ferrer-Calleja, 168 SCRA 184 [1988]; George and Peter
Lines, Inc. v. Associated Labor Unions, 134 SCRA 82 [1986]). The workers must be allowed to
freely express their choice in a determination where everything is open to their sound judgment
and the possibility of fraud and misrepresentation is eliminated.
But while Article 257 cited by the Solicitor General directs the automatic conduct of a certification
election in an unorganized establishment, it also requires that the petition for certification election
must be filed by a legitimate labor organization. Article 242 enumerates the exclusive rights of a
legitimate labor organization among which is the right to be certified as the exclusive
representative of all the employees in an appropriate collective bargaining unit for purposes of
collective bargaining.
Meanwhile, Article 212(h) defines a legitimate labor organization as "any labor organization duly
registered with the DOLE and includes any branch or local thereof." (Emphasis supplied) Rule I,
Section 1 (j), Book V of the Implementing Rules likewise defines a legitimate labor organization
as "any labor organization duly registered with the DOLE and includes any branch, local or
affiliate thereof. (Emphasis supplied)
The question that now arises is: when does a branch, local or affiliate of a federation become a
legitimate labor organization?
Ordinarily, a labor organization acquires legitimacy only upon registration with the BLR. Under
Article 234 (Requirements of Registration):
Any applicant labor organization, association or group of unions or workers shall acquire legal
personality and shall be entitled to the rights and privileges granted by law to legitimate labor
organizations upon issuance of the certificate of registration based on the following requirements:
(a) Fifty-pesos (P50.00) registration fee;
(b) The names of its officers, their addresses, the principal address of the labor organization, the
minutes of the organizational meeting and the list of the workers who participated in such
meetings;
(c) The names of all its members comprising at least twenty 20% percent of all the employees in
the bargaining unit where it seek to operate;
(d) If the applicant has been in existence for one or more years, copies , of its annual financial
reports; and
(e) Four copies of the constitution and by-laws of the applicant union, the minutes of its adoption
or ratification and the list of the members who participated in it.

And under Article 235 (Action on Application)


The Bureau shall act on all applications for registration within thirty (30) days from filing.
All requisite documents and papers shall be certified under oath by the secretary or the treasurer
of the organization, as the case may be, and attested to by its president.
Moreover, section 4 of Rule II, Book V of the Implementing Rules requires that the application
should be signed by at least twenty percent (20%) of the employees in the appropriate bargaining
unit and be accompanied by a sworn statement of the applicant union that there is no certified
bargaining agent or, where there is an existing collective bargaining agreement duly submitted to
the DOLE, that the application is filed during the last sixty (60) days of the agreement.
The respondent Kilusan questions the requirements as too stringent in their application but the
purpose of the law in prescribing these requisites must be underscored. Thus, in Philippine
Association of Free Labor Unions v.Secretary of Labor, 27 SCRA 40 (1969), the Court declared:
The theory to the effect that Section 23 of Republic Act No. 875 unduly curtails the freedom of
assembly and association guaranteed in the Bill of Rights is devoid of factual basis. The
registration prescribed in Paragraph (b) of said section is not a limitation to the right of assembly
or association, which may be exercised with or without said registration. The latter is merely a
condition sine qua non for the acquisition of legal personality by the labor organizations,
associations or unions and the possession of the "rights and privileges granted by law to
legitimate labor organizations." The Constitution does not guarantee these rights and the
privileges, much less said personality, which are mere statutory creations, for the possession and
exercise of which registration is required to protect both labor and the public against abuses,
fraud or impostors who pose as organizers, although not truly accredited agents of the union they
purport to represent. Such requirement is a valid exercise of the police power, because the
activities in which labor organizations, associations and unions of workers are engaged affect
public interest, which should be protected. Furthermore, the obligation to submit financial
statements, as a condition for the non-cancellation of a certificate of registration, is a reasonable
regulation for the benefit of the members of the organization, considering that the same generally
solicits funds or membership, as well as oftentimes collects, on behalf of its members, huge
amounts of money due to them or to the organization. (Emphasis supplied)
But when an unregistered union becomes a branch, local or chapter of a federation, some of the
aforementioned requirements for registration are no longer required. The provisions governing
union affiliation are found in Rule II, Section 3, Book V of the Implementing Rules, the relevant
portions of which are cited below:
Sec. 3. Union affiliation; direct membership with national union. An affiliate of a labor federation
or national union may be a local or chapter thereof or an independently registered union.
a) The labor federation or national union concerned shall issue a charter certificate indicating the
creation or establishment of a local or chapter, copy of which shall be submitted to the Bureau of
Labor Relations within thirty (30) days from issuance of such charter certificate.
b) An independently registered union shall be considered an affiliate of a labor federation or
national union after submission to the Bureau of the contract or agreement of affiliation within
thirty (30) days after its execution.
xxx xxx xxx

e) The local or chapter of a labor federation or national union shall have and maintain a
constitution and by laws, set of officers and books and accounts. For reporting purposes, the
procedure governing the reporting of independently registered unions, federations or national
unions shall be observed.
Paragraph (a) refers to the local or chapter of a federation which did not undergo the rudiments of
registration while paragraph (b) refers to an independently registered union which affiliated with a
federation. Implicit in the foregoing differentiation is the fact that a local or chapter need not be
independently registered. By force of law (in this case, Article 212[h]); such local or chapter
becomes a legitimate labor organization upon compliance with the aforementioned provisions of
Section 3.
Thus, several requirements that are otherwise required for union registration are omitted, to wit:
(1) The requirement that the application for registration must be signed by at least 20% of the
employees in the appropriate bargaining unit;
2) The submission of officers' addresses, principal address of the labor organization, the minutes
of organizational meetings and the list of the workers who participated in such meetings;
3) The submission of the minutes of the adoption or ratification of the constitution and by the laws
and the list of the members who participated in it.
Undoubtedly, the intent of the law in imposing lesser requirements in the case of the branch or
local of a registered federation or national union is to encourage the affiliation of a local union with
the federation or national union in order to increase the local union's bargaining powers
respecting terms and conditions of labor.
The petitioner maintains that the documentary requirements prescribed in Section 3(c), namely:
the constitution and by-laws, set of officers and books of accounts, must follow the requirements
of law. Petitioner PDC calls for the similar application of the requirement for registration in Article
235 that all requisite documents and papers be certified under oath by the secretary or the
treasurer of the organization and attested to by the president.
In the case at bar, the constitution and by-laws and list of officers submitted in the BLR, while
attested to by the chapter's president, were not certified under oath by the secretary. Does such
defect warrant the withholding of the status of legitimacy to the local or chapter?
In the case of union registration, the rationale for requiring that the submitted documents and
papers be certified under oath by the secretary or treasurer, as the case may be, and attested to
by president is apparent. The submission of the required documents (and payment of P50.00
registration fee) becomes the Bureau's basis for approval of the application for registration. Upon
approval, the labor union acquires legal personality and is entitled to all the rights and privileges
granted by law to a legitimate labor organization. The employer naturally needs assurance that
the union it is dealing with is a bona fide organization, one which has not submitted false
statements or misrepresentations to the Bureau. The inclusion of the certification and attestation
requirements will in a marked degree allay these apprehensions of management. Not only is the
issuance of any false statement and misrepresentation a ground for cancellation of registration
(see Article 239 (a), (c) and (d)); it is also a ground for a criminal charge of perjury.
The certification and attestation requirements are preventive measures against the commission of
fraud. They likewise afford a measure of protection to unsuspecting employees who may be lured
into joining unscrupulous or fly-by-night unions whose sole purpose is to control union funds or to
use the union for dubious ends.

In the case of the union affiliation with a federation, the documentary requirements are found in
Rule II, Section 3(e), Book V of the Implementing Rules, which we again quote as follows:
(c) The local chapter of a labor federation or national union shall have and maintain a constitution
and by-laws, set of officers and books of accounts. For reporting purposes, the procedure
governing the reporting of independently registered unions, federations or national unions shall
be observed.(Emphasis supplied)
Since the "procedure governing the reporting of independently registered unions" refers to the
certification and attestation requirements contained in Article 235, paragraph 2, it follows that the
constitution and by-laws, set of officers and books of accounts submitted by the local and chapter
must likewise comply with these requirements. The same rationale for requiring the submission of
duly subscribed documents upon union registration exists in the case of union affiliation.
Moreover, there is greater reason to exact compliance with the certification and attestation
requirements because, as previously mentioned, several requirements applicable to independent
union registration are no longer required in the case of formation of a local or chapter. The policy
of the law in conferring greater bargaining power upon labor unions must be balanced with the
policy of providing preventive measures against the commission of fraud.
A local or chapter therefore becomes a legitimate labor organization only upon submission of the
following to the BLR:
1) A charter certificate, within 30 days from its issuance by the labor federation or national union,
and
2) The constitution and by-laws, a statement on the set of officers, and the books of accounts all
of which are certified under oath by the secretary or treasurer, as the case may be, of such local
or chapter, and attested to by its president.
Absent compliance with these mandatory requirements, the local or chapter does not become a
legitimate labor organization.
In the case at bar, the failure of the secretary of PDEU-Kilusan to certify the required
documents under oath is fatal to its acquisition of a legitimate status.
We observe that, as borne out by the facts in this case, the formation of a local or chapter
becomes a handy tool for the circumvention of union registration requirements. Absent the
institution of safeguards, it becomes a convenient device for a small group of employees to foist a
not-so-desirable federation or union on unsuspecting co-workers and pare the need for
wholehearted voluntariness which is basic to free unionism. The records show that on June 16,
1990, Kilusan met with several employees of the petitioner. Excerpts of the "Minutes of the
Organizational/General Membership Meeting of Progressive Development Employees Union
(PDEU) Kilusan," are quoted below:
The meeting was formally called to order by Bro. Jose V. Parungao, KILUSAN secretary for
organization by explaining to the general membership the importance of joining the union. He
explained to the membership why they should join a union, and briefly explained the ideology of
the Pambansang Kilusan ng Paggawa-TUCP as a democratically based organization and then
read the proposed Constitution and By-Laws, after which said Constitution and By-Laws was duly
and unanimously ratified after some clarification.
Bro. Jose Parungao was also unanimously voted by the group to act as the chairman of the
COMELEC in holding the organizational election of officers of the union.

Bro. Jose Parungao, officially opened the table for nomination of candidates after which the
election of officers followed by secret balloting and the following were the duly elected officers.
(Original Record, p. 25)
The foregoing shows that Kilusan took the initiative and encouraged the formation of a union
which automatically became its chapter. On June 18, 1990, Kilusan issued a charter certificate in
favor of PDEU-KILUSAN (Records, page 1). It can be seen that Kilusan was moving very fast.
On June 19, 1990, or just three days after the organizational meeting, Kilusan filed a petition for
certification election (Records, pages 2 and 3) accompanied by a copy each of the charter
certificate, constitution and by-laws and minutes of the organizational meeting. Had the local
union filed an application for registration, the petition for certification election could not have been
immediately filed. The applicant union must firstly comply with the "20% signature" requirement
and all the other requisites enumerated in Article 234. Moreover, since under Article 235 the BLR
shall act on any application for registration within thirty (30) days from its filing, the likelihood is
remote that, assuming the union complied with all the requirements, the application would be
approved on the same day it was filed.
We are not saying that the scheme used by the respondents is per se illegal for precisely, the law
allows such strategy. It is not this Court's function to augment the requirements prescribed by law
in order to make them wiser or to allow greater protection to the workers and even their employer.
Our only recourse is, as earlier discussed, to exact strict compliance with what the law provides
as requisites for local or chapter formation.
It may likewise be argued that it was Kilusan (the mother union) and not the local union which
filed the petition for certification election and, being a legitimate labor organization, Kilusan has
the personality to file such petition.
At this juncture, it is important to clarify the relationship between the mother union and the local
union. In the case of Liberty Cotton Mills Workers Union v. Liberty Cotton Mills, Inc., 66 SCRA
512 [1975]), the Court held that the mother union, acting for and in behalf of its affiliate, had the
status of an agent while the local union remained the basic unit of the association, free to serve
the common interest of all its members subject only to the restraints imposed by the constitution
and by-laws of the association. Thus, where as in this case the petition for certification election
was filed by the federation which is merely an agent, the petition is deemed to be filed by the
chapter, the principal, which must be a legitimate labor organization. The chapter cannot merely
rely on the legitimate status of the mother union.
The Court's conclusion should not be misconstrued as impairing the local union's right to be
certified as the employees' bargaining agent in the petitioner's establishment. We are merely
saying that the local union must first comply with the statutory requirements in order to exercise
this right. Big federations and national unions of workers should take the lead in requiring their
locals and chapters to faithfully comply with the law and the rules instead of merely snapping
union after union into their folds in a furious bid with rival federations to get the most number of
members.
WHEREFORE, the petition is GRANTED. The assailed resolution and orders of respondent MedArbiter and Secretary of Labor and Employment, respectively, are hereby SET ASIDE. The
temporary restraining order dated February 25, 1991 is made permanent.
SO ORDERED.
TAGAYTAY HIGHLANDS INTERNATIONAL GOLF CLUB INCORPORATED, petitioner, vs.
TAGAYTAY HIGHLANDS EMPLOYEES UNION-PGTWO,respondent.

DECISION
CARPIO-MORALES, J.:
Before this Court on certiorari under Rule 45 is the petition of the Tagaytay Highlands
International Golf Club Incorporated (THIGCI) assailing the February 15, 2002 decision of the
Court of Appeals denying its petition to annul the Department of Labor and Employment (DOLE)
Resolutions of November 12, 1998 and December 29, 1998.
On October 16, 1997, the Tagaytay Highlands Employees Union (THEU)Philippine
Transport and General Workers Organization (PTGWO), Local Chapter No. 776, a legitimate
labor organization said to represent majority of the rank-and-file employees of THIGCI, filed a
petition for certification election before the DOLE Mediation-Arbitration Unit, Regional Branch No.
IV.
THIGCI, in its Comment[1] filed on November 27, 1997, opposed THEUs petition for
certification election on the ground that the list of union members submitted by it was defective
and fatally flawed as it included the names and signatures of supervisors, resigned, terminated
and absent without leave (AWOL) employees, as well as employees of The Country Club, Inc., a
corporation distinct and separate from THIGCI; and that out of the 192 signatories to the petition,
only 71 were actual rank-and-file employees of THIGCI.
THIGCI thus submitted a list of the names of its 71 actual rank-and-file employees which it
annexed[2] to its Comment to the petition for certification election. And it therein incorporated the
following tabulation[3] showing the number of signatories to said petition whose membership in the
union was being questioned as disqualified and the reasons for disqualification:
# of Signatures

Reasons for Disqualification

13

Supervisors of THIGCI

Resigned employees of THIGCI

AWOL employees of THIGCI

53

Rank-and-file employees of The Country Club at Tagaytay


Highlands, Inc.

14

Supervisors of The Country Club at Tagaytay Highlands, Inc.

Resigned employees of The Country Club at Tagaytay Highlands,


Inc.

Terminated employees of The Country Club at Tagaytay Highlands,


Inc.

AWOL employees of The Country Club at Tagaytay Highlands, Inc.

Signatures that cannot be deciphered

16

Names in list that were erased

Names with first names only

THIGCI also alleged that some of the signatures in the list of union members were secured
through fraudulent and deceitful means, and submitted copies of the handwritten denial and
withdrawal of some of its employees from participating in the petition. [4]
Replying to THIGCIs Comment, THEU asserted that it had complied with all the
requirements for valid affiliation and inclusion in the roster of legitimate labor organizations
pursuant to DOLE Department Order No. 9, series of 1997, [5] on account of which it was duly
granted a Certification of Affiliation by DOLE on October 10, 1997; [6] and that Section 5, Rule V
of said Department Order provides that the legitimacy of its registration cannot be subject to
collateral attack, and for as long as there is no final order of cancellation, it continues to enjoy the
rights accorded to a legitimate organization.
THEU thus concluded in its Reply[7] that under the circumstances, the Med-Arbiter should,
pursuant to Article 257 of the Labor Code and Section 11, Rule XI of DOLE Department Order
No. 09, automatically order the conduct of a certification election.
By Order of January 28, 1998, [8] DOLE Med-Arbiter Anastacio Bactin ordered the holding of
a certification election among the rank-and-file employees of THIGCI in this wise,
quotedverbatim:
We evaluated carefully this instant petition and we are of the opinion that it is complete in form and
substance. In addition thereto, the accompanying documents show that indeed petitioner union is a
legitimate labor federation and its local/chapter was duly reported to this Office as one of its affiliate
local/chapter. Its due reporting through the submission of all the requirements for registration of a
local/chapter is a clear showing that it was already included in the roster of legitimate labor organizations in
this Office pursuant to Department Order No. 9 Series of 1997 with all the legal right and personality to
institute this instant petition. Pursuant therefore to the provisions of Article 257 of the Labor Code, as
amended, and its Implementing Rules as amended by Department Order No. 9, since the respondents
establishment is unorganized, the holding of a certification election is mandatory for it was clearly
established that petitioner is a legitimate labor organization. Giving due course to this petition is therefore
proper and appropriate.[9] (Emphasis supplied)
Passing on THIGCIs allegation that some of the union members are supervisory, resigned
and AWOL employees or employees of a separate and distinct corporation, the Med-Arbiter held
that the same should be properly raised in the exclusion-inclusion proceedings at the pre-election
conference. As for the allegation that some of the signatures were secured through fraudulent
and deceitful means, he held that it should be coursed through an independent petition for
cancellation of union registration which is within the jurisdiction of the DOLE Regional Director. In
any event, the Med-Arbiter held that THIGCI failed to submit the job descriptions of the
questioned employees and other supporting documents to bolster its claim that they are
disqualified from joining THEU.
THIGCI appealed to the Office of the DOLE Secretary which, by Resolution of June 4, 1998,
set aside the said Med-Arbiters Order and accordingly dismissed the petition for certification
election on the ground that there is a clear absence of community or mutuality of interests, it
finding that THEU sought to represent two separate bargaining units (supervisory employees and
rank-and-file employees) as well as employees of two separate and distinct corporate entities.
Upon Motion for Reconsideration by THEU, DOLE Undersecretary Rosalinda DimalipisBaldoz, by authority of the DOLE Secretary, issued DOLE Resolution of November 12,
1998[10]setting aside the June 4, 1998 Resolution dismissing the petition for certification
election. In the November 12, 1998 Resolution, Undersecretary Dimapilis-Baldoz held that since
THEU is a local chapter, the twenty percent (20%) membership requirement is not necessary for
it to acquire legitimate status, hence, the alleged retraction and withdrawal of support by 45 of
the 70 remaining rank-and-file members . . . cannot negate the legitimacy it has already acquired
before the petition; that rather than disregard the legitimate status already conferred on THEU
by the Bureau of Labor Relations, the names of alleged disqualified supervisory employees and

employees of the Country Club, Inc., a separate and distinct corporation, should simply be
removed from the THEUs roster of membership; and that regarding the participation of alleged
resigned and AWOL employees and those whose signatures are illegible, the issue can be
resolved during the inclusion-exclusion proceedings at the pre-election stage.
The records of the case were thus ordered remanded to the Office of the Med-Arbiter for the
conduct of certification election.
THIGCIs Motion for Reconsideration of the November 12, 1998 Resolution having been
denied by the DOLE Undersecretary by Resolution of December 29, 1998, [11] it filed a petition for
certiorari before this Court which, by Resolution of April 14, 1999, [12] referred it to the Court of
Appeals in line with its pronouncement in National Federation of Labor (NFL) v. Hon. Bienvenido
E. Laguesma, et al.,[13] and in strict observance of the hierarchy of courts, as emphasized in the
case of St. Martin Funeral Home v. National Labor Relations Commission.[14]
By Decision of February 15, 2000,[15] the Court of Appeals denied THIGCIs Petition for
Certiorari and affirmed the DOLE Resolution dated November 12, 1998. It held that while a
petition for certification election is an exception to the innocent bystander rule, hence, the
employer may pray for the dismissal of such petition on the basis of lack of mutuality of interests
of the members of the union as well as lack of employer-employee relationship following this
Courts ruling in Toyota Motor Philippines Corporation v. Toyota Motor Philippines Corporation
Labor Union et al[16] and Dunlop Slazenger [Phils.] v. Hon. Secretary of Labor and Employment et
al,[17] petitioner failed to adduce substantial evidence to support its allegations.
Hence, the present petition for certiorari, raising the following
ISSUES/ASSIGNMENT OF ERRORS:
THE COURT OF APPEALS GRIEVOUSLY ERRED IN AFFIRMING THE RESOLUTION DATED 12
NOVEMER 1998 HOLDING THAT SUPERVISORY EMPLOYEES AND NON-EMPLOYEES
COULD SIMPLY BE REMOVED FROM APPELLEES ROSTER OF RANK-AND-FILE MEMBERSHIP
INSTEAD OF RESOLVING THE LEGITIMACY OF RESPONDENT UNIONS STATUS
THE COURT OF APPEALS GRIEVOUSLY ERRED IN AFFIRMING THE RESOLUTION DATED 12
NOVEMBER 1998 HOLDING THAT THE DISQUALIFIED EMPLOYEES STATUS COULD
READILY BE RESOLVED DURING THE INCLUSION AND EXCLUSION PROCEEDINGS
THE COURT OF APPEALS GRIEVOUSLY ERRED IN NOT HOLDING THAT THE ALLEGATIONS
OF PETITIONER HAD BEEN DULY PROVEN BY FAILURE OF RESPONDENT UNION TO DENY
THE SAME AND BY THE SHEER WEIGHT OF EVIDENCE INTRODUCED BY PETITIONER AND
CONTAINED IN THE RECORDS OF THE CASE[18]
The statutory authority for the exclusion of supervisory employees in a rank-and-file union,
and vice-versa, is Article 245 of the Labor Code, to wit:
Article 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.
While above-quoted Article 245 expressly prohibits supervisory employees from joining a
rank-and-file union, it does not provide what would be the effect if a rank-and-file union counts
supervisory employees among its members, or vice-versa.

Citing Toyota[19] which held that a labor organization composed of both rank-and-file and
supervisory employees is no labor organization at all, and the subsequent case of Progressive
Development Corp. Pizza Hut v. Ledesma [20] which held that:
The Labor Code requires that in organized and unorganized establishments, a petition for certification
election must be filed by a legitimate labor organization. The acquisition of rights by any union or labor
organization, particularly the right to file a petition for certification election, first and foremost,
depends on whether or not the labor organization has attained the status of a legitimate labor organization.
In the case before us, the Med-Arbiter summarily disregarded the petitioners 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 organization,[21] (Underscoring and emphasis supplied),
petitioner contends that, quoting Toyota, [i]t becomes necessary . . ., 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.[22]
Continuing, petitioner argues that without resolving the status of THEU, the DOLE
Undersecretary conveniently deferred the resolution on the serious infirmity in the membership of
[THEU] and ordered the holding of the certification election which is frowned upon as the
following ruling of this Court shows:
We also do not agree with the ruling of the respondent Secretary of Labor that the infirmity in the
membership of the respondent union can be remedied in the pre-election conference thru the exclusioninclusion proceedings wherein those employees who are occupying rank-and-file positions will be excluded
from the list of eligible voters. Public respondent gravely misappreciated the basic antipathy between the
interest of supervisors and the interest of rank-and-file employees. Due to the irreconcilability of their
interest we held in Toyota Motor Philippines v. Toyota Motors Philippines Corporation Labor Union, viz:
x x x
Clearly, based on this provision [Article 245], 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 posses any of the rights of a legitimate labor organization, including 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. (Emphasis by petitioner) (Dunlop Slazenger (Phils.), v.
Secretary of Labor, 300 SCRA 120 [1998]; Underscoring and emphasis supplied by petitioner.)
The petition fails. After a certificate of registration is issued to a union, its legal personality
cannot be subject to collateral attack. It may be questioned only in an independent petition for
cancellation in accordance with Section 5 of Rule V, Book IV of the Rules to Implement the Labor
Code (Implementing Rules) which section reads:
Sec. 5. 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. (Emphasis supplied)

The grounds for cancellation of union registration are provided for under Article 239 of the
Labor Code, as follows:
Art. 239. Grounds for cancellation of union registration. The following shall constitute grounds for
cancellation of union registration:
(a) Misrepresentation, false statement or fraud in connection with the adoption or ratification of the
constitution and by-laws or amendments thereto, the minutes of ratification, and the list of members who
took part in the ratification;
(b) Failure to submit the documents mentioned in the preceding paragraph within thirty (30) days from
adoption or ratification of the constitution and by-laws or amendments thereto;
(c) Misrepresentation, false statements or fraud in connection with the election of officers, minutes of
the election of officers, the list of voters, or failure to subject these documents together with the list of the
newly elected/appointed officers and their postal addresses within thirty (30) days from election;
(d) Failure to submit the annual financial report to the Bureau within thirty (30) days after the losing of
every fiscal year and misrepresentation, false entries or fraud in the preparation of the financial report itself;
(e) Acting as a labor contractor or engaging in the cabo system, or otherwise engaging in any activity
prohibited by law;
(f) Entering into collective bargaining agreements which provide terms and conditions of employment
below minimum standards established by law;
(g) Asking for or accepting attorneys fees or negotiation fees from employers;
(h) Other than for mandatory activities under this Code, checking off special assessments or any other fees
without duly signed individual written authorizations of the members;
(i) Failure to submit list of individual members to the Bureau once a year or whenever required by the
Bureau; and
(j) Failure to comply with the requirements under Articles 237 and 238, (Emphasis supplied),
while the procedure for cancellation of registration is provided for in Rule VIII, Book V of the
Implementing Rules.
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 above-quoted Article
239 of the Labor Code.
THEU, having been validly issued a certificate of registration, should be considered to have
already acquired juridical personality which may not be assailed collaterally.
As for petitioners allegation that some of the signatures in the petition for certification
election were obtained through fraud, false statement and misrepresentation, the proper
procedure is, as reflected above, for it to file a petition for cancellation of the certificate of
registration, and not to intervene in a petition for certification election.
Regarding the alleged withdrawal of union members from participating in the certification
election, this Courts following ruling is instructive:

[T]he best forum for determining whether there were indeed retractions from some of the laborers is in
the certification election itself wherein the workers can freely express their choice in a secret
ballot. Suffice it to say that the will of the rank-and-file employees should in every possible instance be
determined by secret ballot rather than by administrative or quasi-judicial inquiry. Such representation and
certification election cases are not to be taken as contentious litigations for suits but as mere investigations
of a non-adversary, fact-finding character as to which of the competing unions represents the genuine
choice of the workers to be their sole and exclusive collective bargaining representative with their
employer.[23]
As for the lack of mutuality of interest argument of petitioner, it, at all events, does not lie
given, as found by the court a quo, its failure to present substantial evidence that the assailed
employees are actually occupying supervisory positions.
While petitioner submitted a list of its employees with their corresponding job titles and
ranks,[24] there is nothing mentioned about the supervisors respective duties, powers and
prerogatives that would show that they can effectively recommend managerial actions which
require the use of independent judgment.[25]
As this Court put it in Pepsi-Cola Products Philippines, Inc. v. Secretary of Labor:[26]
Designation should be reconciled with the actual job description of subject employees x x x The mere fact
that an employee is designated manager does not necessarily make him one. Otherwise, there would be an
absurd situation where one can be given the title just to be deprived of the right to be a member of a
union. In the case of National Steel Corporation vs. Laguesma (G. R. No. 103743, January 29, 1996), it
was stressed that:
What is essential is the nature of the employees function and not the nomenclature or title given to the
job which determines whether the employee has rank-and-file or managerial status or whether he is a
supervisory employee. (Emphasis supplied).[27]
WHEREFORE, the petition is hereby DENIED. Let the records of the case be remanded to
the office of origin, the Mediation-Arbitration Unit, Regional Branch No. IV, for the immediate
conduct of a certification election subject to the usual pre-election conference.
SO ORDERED.
United Seamens Union v.Davao Shipowners Association

G.R. No. L-18778 and L-18779 August 31, 1967 J. Makalintal
petitioners

United Seamen's Union of the Philippines (USUP)
respondents
Davao Shipowners Association (DSA), Angtiong Sons and/or Ricardo Ang, owner-manager;
Angliongto Sons and Company, Garcia Water Transportation, Court Of Industrial Relations

facts of the case

On August 4, 1959, USUP presented a set of demand to DSA, representing the respondent
shipping companies, for union recognition, union security, standardization of wages and other
benefits. In response, the ship owners brought to the attention of the USUP the existence of a
CBA with the Davao Marine Association (DMA), where all of the crewmen of their launches
belonged. They suggested to the USUP that they first take the necessary steps for certification as
the collective bargaining agent, as the ship owners were bound by the CBA until 1959. However,
even before receiving the
ship owners response to its demands, the USUP had filed a Notice of Strike against the
individual ship owners at the
Department of Labor Davao Office. The Chief of the Labor Operations Section of the Davao
Office requested for a conference to solve the conflict. On August 20, 1959, both parties reached
a covenant stating the withdrawal of the Notice of Strike, as well as the observance of the status
quo regarding the jobs incident to the businesses of the DSA and the withdrawal of the civil case
of the DMA against the USUP. It was also stipulated in the contract that the USUP will respect the
existing CBA between DSA and DMA, but USUP will file a petition for certification election for
determination of union representation. As stipulated, the USUP filed with the CIR a petition for
certification election. Subsequent to the covenant, the shipping companies separately served
notices of termination upon 64 employees, effecting December 31, 1959, due to different reasons
(from stoppage of operations to the death of one of the partners of the shipping companies due to
business losses). As a result, USUP reported the terminations to the Department of Labor, which
called for a conference. Nevertheless, on December 29, 1959, the USUP notified the Philippine
Constabulary, City Mayor, Bureau of Customs and the general public of a strike on January 1,
1960. On February 11, 1960, the shipping companies filed a petition for writ of injunction, as a
necessity due to irreparable
damage to properties due to coercion, violence and illegal picketing. On the other hand, on
February 24, 1960, the
USUP filed a ULP case against the ship owners and DSA, alleging that the ship owners
interfered, and continued to interfere with their right to self-organization by discrimination against
employees. CIR however sided with the DSA,
dismissing the USUPs ULP case while declaring the strike as illegal.
issue
WON CIR gravely abused its discretion by declaring the strike as illegal.
NO, strike was declared illegal and unjustified by the Supreme Court.
ratio
The Supreme Court agreed with the lower courts findings that the USUPs Notice of Strike was
but a direct offshoot of the losing effort to compel the DSA and
the ship owners to recognize USUP as the sole collective bargaining agent of the employees, to
the exclusion of the DMA as the existing collective bargaining agent of the DSA. First, the Court
noted that the USUP filed its Notice of Strike even before i
ts receipt of the ship owners answers to its set

of demands, thereby showing that the USUP was already set on continuing the strike with or
without the answer of the ship owners. This, according to the Court was a clear showing that
USUP was aware of the existence of DMA as a valid
collective bargaining agent, operating as a legal bar to entertaining USUPs demands.
Second, the Court stated that USUP completely disturbed the status quo

the return to normal and original operating practices through the strike that was done by USUP.
By striking, USUP impaired existing CBA between the ship owners and the DMA which
recognized "the right of the Employer to hire, promote and transfer and for legal cause suspend,
lay-off or discharge employees subject to the right of the union (referring to the DMA) to
notification and to ask reconsideration of any action of the Employer in the premises.
UNIVERSITY OF PANGASINAN V NLRC
This is a petition for review on certiorari pursuant to Rule 65 of the Rules of Court to annul and to set
aside the decision of respondent National Labor Relations Commission (NLRC) dated October 25, 1982,
dismissing the appeal of petitioner in NLRC Case No. RBI-47-82, entitled "University of Pangasinan Faculty
Union, complainant, versus University of Pangasinan, Respondent."
chanrobles law library : re d

Petitioner is a labor union composed of faculty members of the respondent University of Pangasinan, an
educational institution duly organized and existing by virtue of the laws of the Philippines.
On December 18, 1981, the petitioner, through its President, Miss Consuelo Abad, filed a complaint
against the private respondent with the Arbitration Branch of the NLRC, Dagupan District Office, Dagupan
City. The complaint seeks: (a) the payment of Emergency Cost of Living Allowances (ECOLA) for
November 7 to December 5, 1981, a semestral break; (b) salary increases from the sixty (60%) percent
of the incremental proceeds of increased tuition fees; and (c) payment of salaries for suspended extra
loads.
The petitioners members are full-time professors, instructors, and teachers of respondent University. The
teachers in the college level teach for a normal duration of ten (10) months a school year, divided into two
(2) semesters of five (5) months each, excluding the two (2) months summer vacation. These teachers
are paid their salaries on a regular monthly basis.
In November and December, 1981, the petitioners members were fully paid their regular monthly salaries.
However, from November 7 to December 5, during the semestral break, they were not paid their ECOLA.
The private respondent claims that the teachers are not entitled thereto because the semestral break is
not an integral part of the school year and there being no actual services rendered by the teachers during
said period, the principle of "No work, no pay" applies.
During the same school year (1981-1982), the private respondent was authorized by the Ministry of
Education and Culture to collect, as it did collect, from its students a fifteen (15%) percent increase of
tuition fees. Petitioners members demanded a salary increase effective the first semester of said
schoolyear to be taken from the sixty (60%) percent incremental proceeds of the increased tuition fees.
Private respondent refused, compelling the petitioner to include said demand in the complaint filed in the
case at bar. While the complaint was pending in the arbitration branch, the private respondent granted an
across-the-board salary increase of 5.86%. Nonetheless, the petitioner is still pursuing full distribution of
the 60% of the incremental proceeds as mandated by the Presidential Decree No. 451.
Aside from their regular loads, some of petitioners members were given extra loads to handle during the
same 1981-1982 schoolyear. Some of them had extra loads to teach on September 21, 1981, but they
were unable to teach as classes in all levels throughout the country were suspended, although said days

was proclaimed by the President of the Philippines as a working holiday. Those with extra loads to teach
on said day claimed they were not paid their salaries for those loads, but the private respondent claims
otherwise.
The issue to be resolved in the case at bar are the following:

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"WHETHER OR NOT PETITIONERS MEMBERS ARE ENTITLED TO ECOLA DURING THE SEMESTRAL BREAK
FROM NOVEMBER 7 TO DECEMBER 5, 1981 OF THE 1981-82 SCHOOL YEAR.
II

"WHETHER OR NOT 60% OF THE INCREMENTAL PROCEEDS OF INCREASED TUITION FEES SHALL BE
DEVOTED EXCLUSIVELY TO SALARY INCREASE,
III

"WHETHER OR NOT ALLEGED PAYMENT OF SALARIES FOR EXTRA LOADS ON SEPTEMBER 21, 1981 WAS
PROVEN BY SUBSTANTIAL EVIDENCE."
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Anent the first issue, the various Presidential Decrees on ECOLAs to wit: PDs 1614, 1634, 1678 and 1713,
provide on "Allowances of Fulltime Employees . . ." that "Employees shall be paid in full the required
monthly allowance regardless of the number of their regular working days if they incur no absences during
the month. If they incur absences without pay, the amounts corresponding to the absences may be
deducted from the monthly allowance . . ." ; and on "Leave of Absence Without Pay", that "All covered
employees shall be entitled to the allowance provided herein when they are on leave of absence with
pay."
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It is beyond dispute that the petitioners members are full-time employees receiving their monthly salaries
irrespective of the number of working days or teaching hours in a month. However, they find themselves
in a most peculiar situation whereby they are forced to go on leave during semestral breaks. These
semestral breaks are in the nature of work interruptions beyond the employees control. The duration of
the semestral break varies from year to year dependent on a variety of circumstances affecting at times
only the private respondent but at other times all educational institutions in the country. As such, these
breaks cannot be considered as absences within the meaning of the law for which deductions may be
made from monthly allowances. The "No work, no pay" principle does not apply in the instant case. The
petitioners members received their regular salaries during this period. It is clear from the aforequoted
provision of law that it contemplates a "no work" situation where the employees voluntarily absent
themselves. Petitioners, in the case at bar, certainly do not, ad voluntatem, absent themselves during
semestral breaks. Rather, they are constrained to take mandatory leave from work. For this they cannot
be faulted nor can they be begrudged that which is due them under the law. To a certain extent, the
private respondent can specify dates when no classes would be held. Surely, it was not the intention of the
framers of the law to allow employers to withhold employee benefits by the simple expedient of
unilaterally imposing "no work" days and consequently avoiding compliance with the mandate of the law
for those days.
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Respondents contention that "the fact of receiving a salary alone should not be the basis of receiving
ECOLA", is, likewise, without merit. Particular attention is brought to the Implementing Rules and
Regulations of Wage Order No. 1 to wit.
SECTION 5. Allowance for Unworked Days.

"a) All covered employees whether paid on a monthly or daily basis shall be entitled to their daily living
allowance when they are paid their basic wage."
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This provision, at once refutes the above contention. It is evident that the intention of the law is to grant
ECOLA upon the payment of basic wages. Hence, we have the principle of "No pay, no ECOLA" the
converse of which finds application in the case at bar. Petitioners cannot be considered to be on leave
without pay so as not to be entitled to ECOLA, for, as earlier stated, the petitioners were paid their wages
in full for the months of November and December of 1981, notwithstanding the intervening semestral
break. This, in itself, is a tacit recognition of the rather unusual state of affairs in which teachers find
themselves. Although said to be on forced leave, professors and teachers are, nevertheless, burdened
with the task of working during a period of time supposedly available for rest and private matters. There
are papers to correct, students to evaluate, deadlines to meet, and periods within which to submit grading
reports. Although they may be considered by the respondent to be on leave, the semestral break could
not be used effectively for the teachers own purposes for the nature of a teachers job imposes upon him
further duties which must be done during the said period of time. Learning is a never ending process.
Teachers and professors must keep abreast of developments all the time. Teachers cannot also wait for
the opening of the next semester to begin their work. Arduous preparation is necessary for the delicate
task of educating our children. Teaching involves not only an application of skill and an imparting of
knowledge, but a responsibility which entails self dedication and sacrifice. The task of teaching ends not
with the perceptible efforts of the petitioners members but goes beyond the classroom: a continuum
where only the visible labor is relieved by academic intermissions. It would be most unfair for the private
respondent to consider these teachers as employees on leave without pay to suit its purposes and, yet, in
the meantime, continue availing of their services as they prepare for the next semester or complete all of
the last semesters requirements. Furthermore, we may also by analogy apply the principle enunciated in
the Omnibus Rules Implementing the Labor Code to wit:
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Sec. 4. Principles in Determining Hours Worked. The following general principles shall govern in
determining whether the time spent by an employee is considered hours worked for purposes of this
Rule:
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"(d) The time during which an employee is inactive by reason of interruptions in his work beyond his
control shall be considered time either if the imminence of the resumption of work requires the employees
presence at the place of work or if the interval is too brief to be utilized effectively and gainfully in the
employees own interest." (Emphasis supplied).
The petitioners members in the case at bar, are exactly in such a situation. The semestral break
scheduled is an interruption beyond petitioners control and it cannot be used "effectively nor gainfully in
the employees interest. Thus, the semestral break may also be considered as "hours worked." For this,
the teachers are paid regular salaries and, for this, they should be entitled to ECOLA. Not only do the
teachers continue to work during this short recess but much less do they cease to live for which the cost
of living allowance is intended. The legal principles of "No work, no pay; No pay, no ECOLA" must
necessarily give way to the purpose of the law to augment the income of employees to enable them to
cope with the harsh living conditions brought about by inflation; and to protect employees and their wages
against the ravages brought by these conditions. Significantly, it is the commitment of the State to protect
labor and to provide means by which the difficulties faced by the working force may best be alleviated. To
submit to the respondents interpretation of the no work, no pay policy is to defeat this noble purpose.
The Constitution and the law mandate otherwise.
chanroble s.com:cralaw:re d

With regard to the second issue, we are called upon to interpret and apply Section 3 of Presidential Decree

451 to wit:

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SEC. 3. Limitations. The increase in tuition or other school fees or other charges as well as the new fees
or charges authorized under the next preceding section shall be subject to the following conditions:
jgc:chanrobles.com .ph

"(a) That no increase in tuition or other school fees or charges shall be approved unless sixty (60%) per
centum of the proceeds is allocated for increase in salaries or wages of the members of the faculty and all
other employees of the school concerned, and the balance for institutional development, student
assistance and extension services, and return to investments: Provided, That in no case shall the return to
investments exceed twelve (12%) per centum of the incremental proceeds; . . ."
cralaw virtua1aw library

This Court had the occasion to rule squarely on this point in the very recent case entitled, University of the
East v. University of the East Faculty Association, 117 SCRA 554. We held that:
jgc:chanroble s.com.ph

"In effect, the problem posed before Us is whether or not the reference in Section 3(a) to increase in
salaries or wages of the faculty and all other employees of the schools concerned as the first purpose to
which the incremental proceeds from authorized increases to tuition fees may be devoted, may be
construed to include allowances and benefits. In the negative, which is the position of respondents, it
would follow that such allowances must be taken in resources of the school not derived from tuition fees.
"Without delving into the factual issue of whether or not there could be any such other resources, We note
that among the items of second purpose stated in provision in question is return in investment. And the
law provides only for a maximum, not a minimum. In other words, the schools may get a return to
investment of not more than 12%, but if circumstances warrant, there is no minimum fixed by law which
they should get.
"On this predicate, We are of the considered view that, if the school happen to have no other resources to
grant allowances and benefits, either mandated by law or secured by collective bargaining, such
allowances and benefits should be charged against the return to investments referred to in the second
purpose stated in Section 3(a) of P.D. 451."
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Private respondent argues that the above interpretation "disregarded the intention and spirit of the law"
which intention is clear from the "whereas" clauses as follows:
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"It is imperative that private educational institutions upgrade classroom instruction . . . provide salary and
or wage increases and other benefits . . ."
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Respondent further contends that PD 451 was issued to alleviate the sad plight of private schools, their
personnel and all those directly or indirectly on school income as the decree was aimed
". . . to upgrade classroom instruction by improving their facilities and bring competent teachers in all
levels of education, provide salary and or wage increases and other benefits to their teaching,
administrative, and other personnel to keep up with the increasing cost of living." (Emphasis supplied)
Respondent overlooks the elemental principle of statutory construction that the general statements in the
whereas clauses cannot prevail over the specific or particular statements in the law itself which define or
limit the purposes of the legislation or proscribe certain acts. True, the whereas clauses of PD 451 provide
for salary and or wage increase and other benefits, however, the same do not delineate the source of such
funds and it is only in Section 3 which provides for the limitations wherein the intention of the framers of
the law is clearly outlined. The law is clear. The sixty (60%) percent incremental proceeds from the tuition
increase are to be devoted entirely to wage or salary increases which means increases in basic salary. The
law cannot be construed to include allowances which are benefits over and above the basic salaries of the
employees. To charge such benefits to the 60% incremental proceeds would be to reduce the increase in
basic salary provided by law, an increase intended also to help the teachers and other workers tide

themselves and their families over these difficult economic times.

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This Court is not guilty of usurpation of legislative functions as claimed by the respondents. We expressed
the opinion in the University of the East case that benefits mandated by law and collective bargaining may
be charged to the 12% return on investments within the 40% incremental proceeds of tuition increase. As
admitted by respondent, we merely made this statement as a suggestion in answer to the respondents
query as to where then, under the law, can such benefits be charged. We were merely interpreting the
meaning of the law within the confines of its provisions. The law provides that 60% should go to wage
increases and 40% to institutional developments, student assistance, extension services, and return on
investments (ROI). Under the law, the last item ROI has flexibility sufficient to accommodate other
purposes of the law and the needs of the university. ROI is not set aside for any one purpose of the
university such as profits or returns on investments. The amount may be used to comply with other duties
and obligations imposed by law which the university exercising managerial prerogatives finds cannot
under present circumstances, be funded by other revenue sources. It may be applied to any other
collateral purpose of the university or invested elsewhere. Hence, the framers of the law intended this
portion of the increases in tuition fees to be a general fund to cover up for the universitys miscellaneous
expenses and, precisely, for this reason, it was not so delimited. Besides, ROI is a return or profit over and
above the operating expenditures of the university, and still, over and above the profits it may have had
prior to the tuition increase. The earning capacities of private educational institutions are not dependent
on the increases in tuition fees allowed by P.D. 451. Accommodation of the allowances required by law
require wise and prudent management of all the university resources together with the incremental
proceeds of tuition increases. Cognizance should be taken of the fact that the private respondent had,
before PD 451, managed to grant all allowances required by law. It cannot now claim that it could not
afford the same, considering that additional funds are even granted them by the law in question. We find
no compelling reason, therefore, to deviate from our previous ruling in the University of the East case
even as we take the second hard look at the decision requested by the private Respondent. This case was
decided in 1982 when PDs 1614, 1634, 1678, and 1713 which are also the various Presidential Decrees on
ECOLA were already in force. PD 451 was interpreted in the light of these subsequent legislations which
bear upon but do not modify nor amend, the same. We need not go beyond the ruling in the University of
the East case.
Coming now to the third issue, the respondents are of the considered view that as evidenced by the
payrolls submitted by them during the period September 16 to September 30, 1981, the faculty members
have been paid for the extra loads. We agree with the respondents that this issue involves a question of
fact properly within the competence of the respondent NLRC to pass upon. The findings of fact of the
respondent Commission are binding on this Court there being no indication of their being unsubstantiated
by evidence. We find no grave abuse in the findings of respondent NLRC on this matter to warrant
reversal. Assuming arguendo, however, that the petitioners have not been paid for these extra loads, they
are not entitled to payment following the principles of "No work, no pay." This time, the rule applies.
Involved herein is a matter different from the payment of ECOLA under the first issue. We are now
concerned with extra, not regular loads for which the petitioners are paid regular salaries every month
regardless of the number of working days or hours in such a month. Extra loads should be paid for only
when actually performed by the employee. Compensation is based, therefore, on actual work done and on
the number of hours and days spent over and beyond their regular hours of duty. Since there was no work
on September 21, 1981, it would now be unfair to grant petitioners demand for extra wages on that day.

chanrobles

law library : red

Finally, disposing of the respondents charge of petitioners lack of legal capacity to sue, suffice it to say
that this question can no longer be raised initially on appeal or certiorari. It is quite belated for the private
respondent to question the personality of the petitioner after it had dealt with it as a party in the
proceedings below. Furthermore, it was not disputed that the petitioner is a duly registered labor
organization and as such has the legal capacity to sue and be sued. Registration grants it the rights of a
legitimate labor organization and recognition by the respondent University is not necessary for it to
institute this action in behalf of its members to protect their interests and obtain relief from grievances.
The issues raised by the petitioner do not involve pure money claims but are more intricately intertwined
with conditions of employment.
WHEREFORE the petition for certiorari is hereby GRANTED. The private respondent is ordered to pay its

regular fulltime teachers/employees emergency cost of living allowances for the semestral break from
November 7 to December 5, 1981 and the undistributed balance of the sixty (60%) percent incremental
proceeds from tuition increases for the same schoolyear as outlined above. The respondent Commission is
sustained insofar as it DENIED the payment of salaries for the suspended extra loads on September 21,
1981.
SO ORDERED.

MARIWASA SIAM CERAMICS, INC., vs. THE SECRETARY OF THE


DEPARTMENT OF LABOR AND EMPLOYMENT, et al
G.R. No. 183317 December 21, 2009
FACTS:
On May 2005, private respondent Samahan Ng Mga Manggagawa Sa Mariwasa
Siam Ceramics, Inc. (SMMSC-Independent) was issued a Certificate of
Registration as a legitimate labor organization by the Department of Labor and
Employment (DOLE), Region IV-A.
On June 2005, petitioner Mariwasa Siam Ceramics, Inc. filed a Petition for
Cancellation of Union Registration against private respondent, claiming that the
latter violated Article 234 of the Labor Code for not complying with the 20%
requirement and that it committed massive fraud and misrepresentation in
violation of Article 239 of the same code.
The Regional Director of DOLE IV-A issued an Order granting the petition,
revoking the registration of respondent, and delisting it from the roster of active
labor unions.
SMMSC-Independent appealed to the Bureau of Labor Relations. BLR ruled in
favor of the respondent, thus, they remain in the roster of legitimate labor
organizations.
The petitioner appealed and insisted that private respondent failed to comply
with the 20% union membership requirement for its registration as a legitimate
labor organization because of the disaffiliation from the total number of union
members of 102 employees who executed affidavits recanting their union
membership
Hence, this petition for review on certiorari under Rule 45 of the Rules of Court.

ISSUES:
1) Whether or not there was failure to comply with the 20% union membership
requirement
2) Whether or not the withdrawal of 31 union members affected the petition for
certification election insofar as the 30% requirement is concerned
RULING
The Supreme Court DENIED the petition.
On the first issue, while it is true that the withdrawal of support may be
considered as a resignation from the union, the fact remains that at the time of
the unions application for registration, the affiants were members of respondent
and they comprised more than the required 20% membership for purposes of
registration as a labor union. Article 234 of the Labor Code merely requires a
20% minimum membership during the application for union registration. It does
not mandate that a union must maintain the 20% minimum membership
requirement all throughout its existence.
On the second issue, it appears undisputedly that the 31 union members had
withdrawn their support to the petition before the filing of said petition. The
distinction must be that withdrawals made before the filing of the petition are
presumed voluntary unless there is convincing proof to the contrary, whereas
withdrawals made after the filing of the petition are deemed involuntary.
Therefore, following jurisprudence, the employees were not totally free from the
employers pressure and so the voluntariness of the employees execution of the
affidavits becomes suspect.
The cancellation of a unions registration doubtless has an impairing dimension
on the right of labor to self-organization. For fraud and misrepresentation to be
grounds for cancellation of union registration under the Labor Code, the nature
of the fraud and misrepresentation must be grave and compelling enough to
vitiate the consent of a majority of union members.
Electromat Manufacturing and Recording Corporation v. Lagunzad [G.R. No. 172699. July 27,
2011]

03
SEP

FACTS:

Private respondent applied for the registration with the Bureau of Labor Relations (BLR) with its
supporting documents. BLR issued Certification of Creation of Local Chapter (equivalent to the
certificate of registration of an independent union), pursuant to Department Order No. (D.O.) 4003. The union has submitted: (1) copies of the ratified CBL; (2) the minutes of the CBLs adoption
and ratification; (3) the minutes of the organizational meetings; (4) the names and addresses of
the union officers; (5) the list of union members; (6) the list of rank-and-file employees in the
company; (7) a certification of non-existence of a CBA in the company; (8) the resolution of
affiliation with WASTO and the latters acceptance; and (9) their Charter Certificate. These
submissions were properly verified as required by the rules. In sum, the petitioner has no factual
basis for questioning the unions registration, as even the requirements for registration as an
independent local have been substantially complied with. Petitioner filed a petition to cancel the
unions registration certificate for the unions failure to comply with Article 234 of the Labor Code.
DOLE-NCR dismissed the petition. In the appeal, the BLR affirmed the dismissed petition.
Petitioner sought relief from the Court of Appeals through a petition for certiorari contending that
BLR committed grave abuse of discretion in affirming the unions registration. The Court of
Appeals dismissed the petition as well as its motion for reconsideration.

ISSUES:

Political Law (Constitutional Law)

Whether or not D.O. 40-03 is unconstitutional for being violative of public policy on trade
unionism.

Political Law (Administrative Law)

Whether or not D.O. 40-03 expanded or amended the Labor Code resulting in an invalid exercise
of its delegated rule-making power.

Labor Law

Whether or not the respondents were validly registered in accordance with the Labor Code.

RULINGS:

Political Law (Constitutional Law)

No. D.O. 40-03 represents an expression of the governments implementing policy on trade
unionism. It builds upon the old rules by further simplifying the requirements for the establishment
of locals or chapters. There is nothing contrary to the law or the Constitution in the adoption by
the Secretary of Labor and Employment of D.O. 40-03 as this department order is consistent with
the intent of the government to encourage the affiliation of a local union with a federation or
national union to enhance the locals bargaining power. The sole function of the courts is to apply
or interpret the laws. It does not formulate public policy, which is the province of the legislative
and executive branches of government. It is not for the courts to question change in policy, it
being a well-established principle beyond question that it is not within its province to pass
judgment upon the policy of legislative or executive action. Notwithstanding the expanded judicial
power under Sec. 1, Article VIII of the Constitution, an inquiry on the above-stated policy would
delve into matters of wisdom not within the powers of this Court.

Political Law (Administrative Law)

Yes. The issuance of D.O. 40-03 is a valid exercise of delegated powers as it merely
implemented the intent of the law that in imposing lesser requirements in the case of a branch
or local of a registered federation or national union is to encourage the affiliation of a local union
with a federation or national union in order to increase the local unions bargaining powers
respecting terms and conditions of labor. D.O. 40-03 was made to recognize the distinctions
made in the law itself between federations and their local chapters, and independent unions; local
chapters seemingly have lesser requirements because they and their members are deemed to be
direct members of the federation to which they are affiliated, which federations are the ones
subject to the strict registration requirements of the law.

Labor Law

Yes. The local or chapter of a labor federation or national union becomes a legitimate labor
organization upon compliance with Section 3, Rule II, Book V of the Rules Implementing the
Labor Code, the only requirement being the submission of the charter certificate to the BLR. The
local union in the present case has more than satisfied the requirements the petitioner complains
about.
Eagle Ridge Golf & Country Club vs. CA, et. al.

G.R. No. 178989, March 18, 2010


Facts:

Petitioner Eagle Ridge Golf and Country Club(Eagle Ridge), which has around 112 rank-and-file
employees, alleges that Eagle Ridge Employees Union(EREU) committed fraud,
misrepresentation and false statement when it filed for its registration and that EREU failed to
comply with the membership requirement for the registration as a labor organization. Eagle Ridge
seeks to have EREUs registration cancelled when the Union filed a petition for certification
election. Eagle Ridge alleged that the EREU declared in its application for registration having 30
members, when the minutes of its December 6, 2005 organizational meeting showed it only had
26 members. The misrepresentation was exacerbated by the discrepancy between the
certification issued by the Union secretary and president that 25 members actually ratified the
constitution and by-laws on December 6, 2005 and the fact that 26 members affixed their
signatures on the documents, making one signature a forgery.
DOLE Regional Director granted Eagle Ridges petition and delisted EREU from the roster of
legitimate labor organizations. EREU appealed to the BLR, which initially affirmed the order of the
Regional Director, but upon filing of the EREU of a motion for reconsideration it was reinstated in
the roster of legitimate labor organizations. Eagle Ridge filed a motion for reconsideration but was
denied, thus a petition for certiorari to the CA. The CA dismissed Eagle Ridges petition for being
deficient as the verification and certification of non-forum shopping was subscribed to by Luna C.
Piezas on her representation as the legal counsel of the petitioner, but sans [the requisite]
Secretarys Certificate or Board Resolution authorizing her to execute and sign the same. The CA
denied a motion for reconsideration.

Issue:

Did the CA commit grave abuse of discretion in denying Eagle Ridges petition to cancel EREUs
registration?

Ruling:

No. A scrutiny of the records fails to show any misrepresentation, false statement, or fraud
committed by EREU to merit cancellation of its registration. The Union submitted the required
documents attesting to the facts of the organizational meeting on December 6, 2005, the election
of its officers, and the adoption of the Unions constitution and by-laws. EREU complied with the
mandatory minimum 20% membership requirement under Art. 234(c). when it had 30 employees
as member when it registered. Any seeming infirmity in the application and admission of union
membership, most especially in cases of independent labor unions, must be viewed in favor of
valid membership.

In the issue of the affidavits of retraction executed by six union members, the probative value of
these affidavits cannot overcome those of the supporting affidavits of 12 union members and their
counsel as to the proceedings and the conduct of the organizational meeting on December 6,
2005. The DOLE Regional Director and the BLR OIC Director obviously erred in giving credence
to the affidavits of retraction, but not according the same treatment to the supporting affidavits. It
is settled that affidavits partake the nature of hearsay evidence, since they are not generally
prepared by the affiant but by another who uses his own language in writing the affiants
statement, which may thus be either omitted or misunderstood by the one writing them. It is
required for affiants to re-affirm the contents of their affidavits during the hearing of the instant
case for them to be examined by the opposing party, i.e., the Union. For their non-presentation,
the six affidavits of retraction are inadmissible as evidence against the Union in the instant case.
Twenty percent (20%) of 112 rank-and-file employees in Eagle Ridge would require a union
membership of at least 22 employees. When the EREU filed its application for registration on
December 19, 2005, there were clearly 30 union members. Thus, when the certificate of
registration was granted, there is no dispute that the Union complied with the mandatory 20%
membership requirement. Prior to their withdrawal, the six employees who retracted were bona
fide union members. With the withdrawal of six union members, there is still compliance with the
mandatory membership requirement under Art. 234(c), for the remaining 24 union members
constitute more than the 20% membership requirement of 22 employees.

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