Labor Relations-Compilation of Doctrines

Compilation of Doctrines in Labor Relations
Part One
Asociacion de Agricultores de Talisay-Silay, Inc. vs. Talisay-Silay Milling Co., Inc., 88 SCRA
294(1979)
Constitutional law; Police power; It is not correct to say that exceptional circumstances must exist before
police power can be exercised over and above the non-impairment clause. The test is reasonableness of the
police measure.True it is that, as counsel for the centrals contend, police power cannot be resorted to
just any time the legislature wishes, but it is not correct to say that it is indispensable that exceptional
circumstances must exist before police power can be exercised. As very aptly pointed out by the able
amicus curiae, Attys. Taada, Teehankee and Carreon, gone are the days when courts could be found
adhering to the doctrine that interference with contracts can only be justified by exceptional
circumstances, for the test of validity today under the due process clause, even in the case of legislation
interfering with existing contracts, is reasonableness, as held by this Honorable Supreme Court in the case
of People vs. Zeta. In other words, freedom from arbitrariness, capriciousness and whimsicality is the test
of constitutionality. (p. 17, Brief of Amicus Curiae in Behalf of SilaySaravia Planters Association, Attys.
Taada, Teehankee and Carreon.) And there is not enough showing here of unreasonableness in the
legislation in question.
Same; Same; Social justice; Republic Act 809 is constitutional and justifiable under the social justice
concept of the Constitution.But it is not police power alone that sustains the validity of the statutory
provision in dispute. Having in view its primary objective to promote the interests of labor, it can never be
possible that the State would be bereft of constitutional authority to enact legislations of its kind. Here, in
the Philippines, whenever any government measure designed for the advancement of the working class is
impugned on constitutional grounds and shadows of doubt are cast over the scope of the States
prerogative in respect thereto, the imperious mandate of the social justice ideal consecrated in our
fundamental laws, both the old and the new, asserts its majesty, calling upon the courts to accord utmost
consideration to the spirit animating the act assailed, not just for the sake of enforcing the explicit social
justice provisions of the article on Declaration of Principles and State Policies, but more fundamentally,
to serve the sacred cause of human dignity, which is actually what lies at the core of those constitutional
precepts as it is also the decisive element always in the determination of any controversy between capital
and labor.
Same; Equal protection; Sugar Act; Republic Act 809 does not violate the equal protection clause.Anent
the indictment that the law discriminates between the planters in the big milling districts, on the one hand,
and those in small milling districts, on the other, by providing for bigger shares to the planters in the
former and smaller shares to those in the latter, it appears to Us to be obvious that as the standard used by
the legislature is the amount of production in each district, naturally, the planters adhered to the bigger
centrals should be given bigger shares, considering that the more a central produces, the bigger would be
its margin of profit which can be correspondingly cut for the purpose of enlarging the share of the
planters. Understandably, the smaller centrals may not be able to afford to have their shares reduced
substantially, which is evidently the reason why the law has not been made applicable to centrals having a
production of less than 150,000 piculs a year.
Same; Same; Same; Same.Much less is there substantial basis for the claim that it is within the
constitutional proscription under discussion for the Act to discriminate against the workers in the cen-trals
by not including them among the components of labor in the apportionment of the fruits of their joint
efforts with the planters. We have looked into the corresponding factual premises of this contention of the
Central relative to the equal protection clause with the care they deserve, and We are of the considered
Jose D. Dula II
Atty. Gutierrez
opinion that the criterion on which the provisions in issue is predicated precludes the conclusion of
capricious and arbitrary discrimination which the Charter abhors. The laborers in the centrals perform
work the nature of which is entirely different from that of those working in the farms, thereby requiring
the application to them of other laws advantageous to labor, which, upon the other hand, do not
correspondingly favor plantation or purely agricultural manpower. Besides, there is no denying the fact
that as industrial or semi-industrial workers, the laborers in the centrals, even the farmhands therein, are
being more or less sufficiently taken care of under other existing laws and the prevailing terms and
conditions of their employment, for which reason there is no known nor demonstrated demand, much less
perceptible urgent need, to bring them under the coverage of the instant legislative bounty.
Same; Republic Act 809 may be unconstitutional if the inevitable result of applying its pro-labor
provisions is to favor the planters and not the sugar laborers whom it purports to protect.Viewed in this
manner, the Act would appear to be selfdefeating in so far as the laborers are concerned, but efficacious in
providing what the PLANTERS desire for themselves, contrary to its true objective of increasing the share
of the planters only as a means of ameliorating the situation of the laborers. Parenthetically, the Central
insists that this was actually the real scheme of the particular legislators who framed the lawto compel
the centrals to augment the share of the planters, and not really to improve the lot of the laborers. Indeed,
if such is the inevitable result of applying the provisions in question, there is ample ground for considering
them as violative of the Constitution.
Same; Sugar Act; Any increase in the participation given to planters in contracts executed after the
approval of R.A. 809 must be shared with laborers of the planters in the manner provided in Section 9 of
R.A. 809, even if by reason of the number of such contracts, Section 1 would not apply.If We declare
the Act unconstitutional upon the ground that it is an unwarranted invasion of the freedom of contract as
between the millers and the planters, the deplorable condition of the laborers in the sugar farms would
remain as it was before its enactment. On the other hand, if We sustain its validity but at the same time
apply it literally and sanction a construction thereof that would enable the centrals and their planters to
enter into agreements, under which the latter would have to be given increased participation without any
obligation to share the same with their laborers, the Court would be a party to a conspiracy to virtually
defraud labor of the benefits, the grant of which is precisely its sole redeeming feature to save it from
unconstitutionality. For it is clear for anyone to see that without the Act, under the conditions prevailing in
the industry, the planters would have no means of persuading, much less compelling, the centrals or
millers to give them any increase in their respective shares, whereas, with this law, faced with the prospect
of being forced to grant the planters their proportion of sharing prescribed by it, if no written contracts
were to be signed by them with the majority of the planters, naturally, the centrals would readily agree to
give the planters the increase they want,which could be less than that stipulated in the Act and yet be
exactly what the planters would get under it if the majority of them were not to have written contracts with
the central. In which eventuality, and should we uphold the proposed strictly literal construction of the
Act, the laborers would be left holding the proverbial empty bag. In that way, the interests of the capitalist
components of the industry, the millers and planters, would be served by the compulsive effect of the law
but labor would not be assured of receiving even the crumbs, when the truth is that the legislation would
have no reason for being as a constitutional and enforceable statute if it did not include mandatory
provisions designed to lift them from misery. The Court emphatically refuses to have anything to do with
such an unconscionable posture vis-a-vis the fate of labor. x xx [Asociacion de Agricultores de TalisaySilay, Inc. vs. Talisay-Silay Milling Co., Inc., 88 SCRA 294(1979)]

Philippine Air Lines, Inc. vs. Philippine Air Lines Employees Association (PALEA), 57 SCRA
489(1974)
Labor relations; Employers and employees; Right of employer to select or discharge employees; Authority
of the Court of lndustrial Relations to order the readmission of discharged employee."The whole
controversy is centered around the right of the Court of Industrial Relations to order the readmission of a
laborer who, it is admitted, had been found derelict in' the performance of his duties towards his employer.
We concede that the right of an employer to freely select or discharge his employees, is subject to
regulation by the State basically in the exercise of its paramount police power (Com. Act Nos. 103 and
213). But much as we should expand beyond economic orthodoxy, we hold that an employer cannot
legally be compelled to continue with the employment of a person who admittedly was guilty of
misfeasance or malfeasance towards his employer, and whose continuance in the service of the latter is
patently inimical to his interests."
Same; Same; Same;. Same.lts tone of certitude is unwarranted. The very excerpt cited speaks of the
paramount police power as a limitation on the right of an employer to freely select or discharge his
employees. Moreover, while there was an admission that misfeasance or malfeasance could be a ground
for dismissal, the last sentence thereof reads: "The law, in protecting the rights of the laborer, authorizes
neither oppression nor self-destruction of the employer." Where, therefore, it could be shown that the
result would be neither oppressive nor self-destructive, it cannot be asserted dogmatically that an outright
termination of employment is justified.
Courts; Court of Industrial Relations; Findings of fact; When conclusive upon the Supreme Court."Such
findings 'are conclusive and will not be disturbed in the absence of a showing {of abuse of] discretion.'"
Constitutional law; Under the new Constitution, the State has the duty to assure workers security of
tenure.The futility of this appeal becomes even more apparent considering the express provision in the
Constitution requiring the State to assure workers "security of tenure." It was not that specific in the 1935
Charter. The mandate was limited to the State affording "protection to labor, especially to working women
and minors, x xx." If by virtue of the above, it would not be legally justifiable to reverse the order of
reinstatement, it becomes even more readily apparent that such a conclusion is even more unwarranted
now. To reach it would be to show lack of fealty to a constitutional command. Philippine Air Lines, Inc.
vs. Philippine Air Lines Employees Association (PALEA), 57 SCRA 489(1974)
National Service Corporation vs. NLRC, 168 SCRA 122(1988)
Labor Law; Dismissal; The guidelines for dismissal requires two (2) written notices of dismissal before a
termination of employment can be legally effected.These guidelines mandate that the employer furnish
an employee sought to be dismissed two (2) written notices of dismissal before a termination of
employment can be legally effected. These are the notice which apprises the employee of the particular
acts or omissions for which his dismissal is sought and the subsequent notice which informs the employee
of the employers decision to dismiss him.
Same; Same; Same; Employer must afford the employee concerned ample opportunity to be heard and to
defend himself.Likewise, a reading of the guidelines in consonance with the express provisions of law
on protection to labor (which encompasses the right to security of tenure) and the broader dictates of
procedural due process necessarily mandate that notice of the employers decision to dismiss an employee,
with reasons therefor, can only be issued after the employer has afforded the employee concerned ample
opportunity to be heard and to defend himself.
Jose D. Dula II
Atty. Gutierrez
Same; Same; Same; Same; NASECO did not comply with the guidelines in effecting Credos dismissal.
In the case at bar, NASECO did not comply with these guidelines in effecting Credos dismissal. Although
she was apprised and given the chance to explain her side of the charges filed against her, this chance
was given so perfunctorily, thus rendering illusory Credos right to security of tenure. That Credo was not
given ample opportunity to be heard and to defend herself is evident from the fact that the compliance
with the injunction to apprise her of the charges filed against her and to afford her a chance to prepare for
her defense was dispensed in only a day. This is not effective compliance with the legal requirements
aforementioned.
Same; Same; Same; Same; Same; NASECO was already bent on terminating her services when she was
informed on 1 December 1983 of the charges against her.The fact also that the Notice of Termination of
Credos employment (or the decision to dismiss her) was dated 24 November 1983 and made effective 1
December 1983 shows that NASECO was already bent on terminating her services when she was
informed on 1 December 1983 of the charges against her, and that any hearing which NASECO thought of
affording her after 24 November 1983 would merely be pro forma or an exercise in futility.
Same; Same; Same; Same; Same; Same; Credos non-compliance with Lorens memorandum did not
warrant the severe penalty of dismissal.Besides, Credos mere non-compliance with Lorens
memorandum regarding the entry procedures in the companys Statement of Billings Adjustment did not
warrant the severe penalty of dismissal.
Same; Same; Same; Same; Same; Same; Same; Same; Credos previous and repeated acts of
insubordination, discourtesy and sarcasm towards her superior officers are deemed to have been condoned
by NASECO.Of course, in justifying Credos termination of employment, NASECO claims as
additional lawful causes for dismissal Credos previous and repeated acts of insubordination, discourtesy
and sarcasm towards her superior officers, alleged to have been committed from 1980 to July 1983. If
such acts of misconduct were indeed committed by Credo, they are deemed to have been condoned by
NASECO. For instance, sometime in 1980, when Credo allegedly reacted in a scandalous manner and
raised her voice in a discussion with NASECOs Acting head of the Personnel Administration, no
disciplinary measure was taken or meted against her. Nor was she even reprimanded when she allegedly
talked in a shouting or yelling manner with the Acting Manager of NASECOs Building Maintenance
and Services Department in 1980, or when she allegedly shouted at NASECOs Corporate Auditor in
front of his subordinates displaying arrogance and unruly behavior in 1980, or when she allegedly
shouted at NASECOs Internal Control Consultant in 1981. But then, in sharp contrast to NASECOs
penchant for ignoring the aforesaid acts of misconduct, when Credo committed frequent tardiness in
August and September 1983, she was reprimanded.
Same; Same; Same; Same; Same; Same; Same; Same; Same; Reinstatement is proper for the acts or
omissions for which Credos employment was sought to be legally terminated were insufficiently proved.
Considering that the acts or omissions for which Credos employment was sought to be legally
terminated were insufficiently proved, as to justify dismissal, reinstatement is proper. For absent the
reason which gave rise to [the employees] separation from employment, there is no intention on the part
of the employer to dismiss the employee concerned. And, as a result of having been wrongfully
dismissed, Credo is entitled to three (3) years of backwages without deduction and qualification.
Same; Same; Jurisdiction; Ruling in National Housing Corporation vs. Juco that employees of
government-owned or controlled corporations are governed by the civil service law should not be given
retroactive effect.It would appear that, in the interest of justice, the holding in said case should not be
given retroactive effect, that is, to cases that arose before its promulgation on 17 January 1985. To do
otherwise would be oppressive to Credo and other employees similarly situated, because under the same

1973 Constitution but prior to the ruling in National Housing Corporation vs. Juco, this Court had
recognized the applicability of the Labor Code to, and the authority of the NLRC to exercise jurisdiction
over, disputes involving terms and conditions of employment in government-owned or controlled
corporations, among them, the National Service Corporation (NASECO).
Same; Same; Same; Same; The NLRC has jurisdiction to accord relief to the parties.On the premise that
it is the 1987 Constitution that governs the instant case because it is the Constitution in place at the time of
decision thereof, the NLRC has jurisdiction to accord relief to the parties. As an admitted subsidiary of the
NIDC, in turn a subsidiary of the PNB, the NASECO is a government-owned or controlled corporation
without original charter. [National Service Corporation vs. NLRC, 168 SCRA 122(1988)]
Phil. Long Distance Telephone Co. vs. NLRC, 164 SCRA 671(1988)
Labor; Illegal Dismissal; Separation Pay; Rule in the Labor Code that a person dismissed for cause is not
entitled to separation pay; Exception is based upon equity considerations; Definition and concept of
equity.The rule embodied in the Labor Code is that a person dismissed for cause as defined therein is
not entitled to separation pay. The cases above cited constitute the exception, based upon considerations of
equity. Equity has been defined as justice outside law, being ethical rather than jural and belonging to the
sphere of morals than of law. It is grounded on the precepts of conscience and not on any sanction of
positive law. Hence, it cannot prevail against the expressed provision of the labor laws allowing dismissal
of employees for cause and without any provision for separation pay.
Same; Same; Same; Grant of separation pay is not merely based on equity but on the provisions of the
Constitution on the promotion of social justice and protection of the rights of the workers.Strictly
speaking, however, it is not correct to say that there is no express justification for the grant of separation
pay to lawfully dismissed employees other than the abstract consideration of equity. The reason is that our
Constitution is replete with positive commands for the promotion of social justice, and particularly the
protection of the rights of the workers. The enhancement of their welfare is one of the primary concerns of
the present charter. In fact, instead of confining itself to the general commitment to the cause of labor in
Article II on the Declaration of Principles of State Policies, the new Constitution contains a separate
article devoted to the promotion of social justice and human rights with a separate sub-topic for labor.
Article XIII expressly recognizes the vital role of labor, hand in hand with management, in the
advancement of the national economy and the welfare of the people in general. The categorical mandates
in the Constitution for the improvement of the lot of the workers are more than sufficient basis to justify
the award of separation pay in proper cases even if the dismissal be for cause.
Same; Same; Same; Award of separation pay distinguished; Grant of separation pay to the dismissed
employee is just where the separation was due to valid but inequitous causes as failure to comply with
work standards; Grant of award is based on the social justice policy even if separation is for cause.
There should be no question that where it comes to such valid but not iniquitous causes as failure to
comply with work standards, the grant of separation pay to the dismissed employee may be both just and
compassionate, particularly if he has worked for some time with the company. For example, a subordinate
who has irreconcilable policy or personal differences with his employer may be validly dismissed for
demonstrated loss of confidence, which is an allowable ground. A working mother who has to be
frequently absent because she has also to take care of her child may also be removed because of her poor
attendance, this being another authorized ground. It is not the employees fault if he does not have the
necessary aptitude for his work but on the other hand the company cannot be required to maintain him just
the same at the expense of efficiency of its operations. He too may be validly replaced. Under these and
similar circumstances, however, the award to the employee of separation pay would be sustainable under
the social justice policy even if the separation is for cause.
Jose D. Dula II
Atty. Gutierrez
Same; Same; Same; Where the cause of separation is more serious than mere inefficiency, the award is not
justified.But where the cause of the separation is more serious that mere inefficiency, the generosity of
the law must be more discerning. There is no doubt it is compassionate to give separation pay to a
salesman if he is dismissed for his inability to fill his quota but surely he does not deserve such generosity
if his offense is misappropriation of the receipt of his sales. This is no longer mere incompetence but clear
dishonesty. A security guard found sleeping on the job is doubtless subject to dismissal but may be
allowed separation pay since his conduct, while inept, is not depraved. But if he was in fact not really
sleeping but sleeping with a prostitute during his tour of duty and in the company premises, the situation is
changed completely. This is not only inefficiency but immorality and the grant of separation pay would be
entirely unjustified.
Same; Same; Same; Henceforth, separation pay shall be allowed only in those instances where the
employee is validly dismissed for causes other than serious misconduct or those reflecting on his moral
character; Where the reason for the valid dismissal is habitual insubordination or an offense involving
moral turpitude, the employer may not be required to give the dismissed employee separation pay or
financial assistance.We hold that henceforth separation pay shall be allowed as a measure of social
justice only in those instances where the employee is validly dismissed for causes other than serious
misconduct or those reflecting on his moral character. Where the reason for the valid dismissal is, for
example, habitual intoxication or an offense involving moral turpitude, like theft or illicit sexual relations
with a fellow worker, the employer may not be required to give the dismissed employee separation pay, of
financial assistance, or whatever other name it is called, on the ground of social justice.
Same; Same; Same; Same; Same; A contrary rule would have the effect of rewarding rather than
punishing the erring employee for his offense.A contrary rule would, as the petitioner correctly argues,
have the effect of rewarding rather than punishing the erring employee for his offense. And we do not
agree that the punishment is his dismissal only and that the separation pay has nothing to do with the
wrong he has committed. Of course it has. Indeed, if the employee who steals from the company is
granted separation pay even as he is validly dismissed, it is not unlikely that he will commit a similar
offense in his next employment because he thinks he can expect a like leniency if he is again found out.
This kind of misplaced compassion is not going to do labor in general any good as it will encourage the
infiltration of its ranks by those who do not deserve the protection and concern of the Constitution.
Same; Same; Same; Same; Same; The policy of social justice is not intended to countenance wrongdoing.
The policy of social justice is not intended to countenance wrongdoing simply because it is committed
by the underprivileged. At best it may mitigate the penalty but it certainly will not condone the offense.
Compassion for the poor is an imperative of every humane society but only when the recipient is not a
rascal claiming an undeserved privilege. Social justice cannot be permitted to be the refuge of scoundrels
any more than can equity be an impediment to the punishment of the guilty. Those who invoke social
justice may do so only if their hands are clean and their motives blameless and not simply because they
happen to be poor. This great policy of our Constitution is not meant for the protection of those who have
proved they are not worthy of it, like the workers who have tainted the cause of labor with the blemishes
of their own character.
Same; Same; Same; Same; Same; Grant of separation pay to the private respondent who has been
dismissed for dishonesty, is justified; Reason.Applying the above considerations, we hold that the grant
of separation pay in the case at bar is unjustified. The private respondent has been dismissed for
dishonesty, as found by the labor arbiter and affirmed by the NLRC and as she herself has impliedly
admitted. The fact that she has worked with the PLDT for more than a decade, if it is, to be considered at
all, should be taken against her as it reflects a regrettable lack of loyalty that she should have strengthened
instead of betraying during all of her 10 years of service with the company. If regarded as a justification

for moderating the penalty of dismissal, it will actually become a prize for disloyalty, perverting the
meaning of social justice and undermining the efforts of labor to cleanse its ranks of all undesirables.
Same; Same; Same; Same; Same; Separation pay, if found due under the circumstances of each case,
should be computed at the rate of one month salary for every year of service.The Court also rules that
the separation pay, if found due under the circumstance of each case, should be computed at the rate of
one month salary for every year of service, assuming the length of such service is deemed material. This is
without prejudice to the application of special agreements between the employer and the employee
stipulating a higher rate of computation and providing for more benefits to the discharged employee.
[Phil. Long Distance Telephone Co. vs. NLRC, 164 SCRA 671(1988)]
B. F. Goodrich Philippines, Inc. vs. B. F. Goodrich (Marikina Factory) Confidential & Salaried
Employees Union-NATU, 49 SCRA 532(1973)
Labor law; Certification election; Certification election may not be stayed at the instance of the employer,
pending the determination of an unfair labor practice case filed by it against certain employees affiliated
with the contending unions; Rea-sons.If management is allowed to have its way, the result might be to
dilute or fritter away the strength of an organization bent on a more zealous defense of labors
prerogatives. The difficulties and obstacles that must be hurdled then would not be lost on the rest of the
personnel, who had not as yet made up their minds one way or the other. This is not to say that
management is to be precluded from filing an unfair labor practice case. It is merely to stress that such a
suit should not be allowed to lend itself as a means, whether intended or not, to prevent a truly free
expression of the will of the labor group as to the organization that will represent it. It is not only the loss
of time involved, in itself not likely to enhance the prospect of respondent-unions, but also the fear
engendered in the mind of an ordinary employee that management has many weapons in its arsenal to
bring the full force of its undeniable power against those of its employees dissatisfied with things as they
are.
Same; Same; Same; Other reasons.Nor would any useful purpose be served by such postponement of
the holding of a certification election until after the determination of the unfair labor practice case filed.
The time that might elapse is hard to predict, as the matter may eventually reach the Supreme Court. In the
meanwhile, there is no opportunity for free choice on the part of the employees as to which labor
organization shall be their exclusive bargaining representative. The force of such an objection could be
blunted if after a final decision to the effect that the employees complained of were engaged in illegal
strike, they would automatically lose their jobs.
Same; Same; Where a labor organization objects to the participation in a certification election of a
company-dominated union and as a result, a complaint for unfair labor practice case against the employer
is filed, the status of the latter union must be first cleared in such a proceeding before the voting could take
place; Reasons.A complaint for unfair labor practice may be considered a prejudicial question in a
proceeding for certification election when it is charged therein that one or more labor unions participating
in the election are being aided, or are controlled, by the company or employer. The reason is that the
certification election may lead to the selection of an employer-dominated or company union as the
employees bargaining representative, and when the court finds that said union is employer-dominated in
the unfair labor practice case, the union selected would be decertified and the whole election proceedings
would be rendered useless and nugatory.
Same; Same; Industrial Peace Act contemplates participation of all employees in a certification election.
The Industrial Peace Act speaks of the labor organizations designed or selected for the purpose of
collective bargaining by the majority of the employees in an appropriate bargaining unit [be the exclusive]
Jose D. Dula II
Atty. Gutierrez
representative of all the employees in such unit for the purpose of collective bargaining. The law clearly
contemplates all the employees, not only some of them. As much as possible then, there is to be no
unwarranted reduction in the number of those taking part in a certification election, even under the guise
that in the meanwhile, which may take some time, some of those who are employees could possibly lose
such status, by virtue of a pending unfair labor practice case.
Same; Same; Discretion of Court of Industrial Relations on whether or not to allow the holding of a
certification election.The prevailing principle then on questions as to certification, as well as in other
labor cases, is that only where there is a showing of clear abuse of discretion would the Supreme Court be
warranted in reversing the actuation of the Court of Industrial Relations. [B. F. Goodrich Philippines, Inc.
vs. B. F. Goodrich (Marikina Factory) Confidential & Salaried Employees Union-NATU, 49 SCRA
532(1973)]
Caltex Filipino Managers and Supervisors Association vs. Court of Industrial Relations, 44 SCRA
350(1972)
Court of Industrial Relations; Jurisdiction; Power to issue labor injunctions.There can be no injunction
issued against any strike except in only one instance, that is, when a labor dispute arises in an industry
indispensable to the rational interest and such dispute is certified by the President of the Philippines to the
Court of Industrial Relations in compliance with Section 10 of Republic Act 875. An injunction in an
uncertified case must be based on the strict requirements of Section 9(d) of Republic Act 875; the purpose
of such an injunction is not to enjoin the strike itself, but only unlawful activities.
Same; Findings of fact; When subject to review.In ignoring strong evidence coming from the witnesses
of the Company damaging to its case as well as that adduced by the Association also damaging to the
Companys case, the respondent court clearly and gravely abused its discretion thereby justifying this
Court to review or alter its factual findings.
Strike; When matter of illegality thereof rendered moot and academic.The return-to-work agreement is
in the nature of a partial compromise between the parties and, more important, a labor contract. When the
company unqualifiedly bound itself in the return-to-work agreement that all employees will be taken back
with the same employee status prior to April 22, 1965, the Company thereby made manifest its intention
and conformity not to proceed with Case No. 1484-MC(1) relating to the illegality of the strike incident.
While there is a reservation in the return-to-work agreement that all court cases now pending shall
continue, including CIR Case No. 1484-MC, the same is to be construed bearing in mind the conduct and
intention of the parties. The failure to mention Case No. 1484-MC (1) while specifically mentioning Case
No. 1484-MC bars the Company from proceeding with the former especially in the light of the additional
specific stipulation that the strikers would be taken back with the same employee status prior to the strike
on April 22, 1965.
Republic Act 875; Unfair labor practices of employer; Statutory provisions construed liberally in favor of
employees.Substantial, credible and convincing evidence appear on record establishing beyond doubt
the charge of unfair labor practices in violation of Section 4(a), Nos. (1), (3), (4), (5) and (6), of Republic
Act 875. And pursuant to the mandate of Article 24 of the Civil Code of the Philippines that courts must
be vigilant for the protection of one at a disadvantageand here the Association appears to be at a
disadvantage in its relations with the Companyadequate affirmative relief, including backwages, must
be awarded to the strikers. It is high-time and imperative that in order to attain the laudable objectives of
Republic Act 875 calculated to safeguard the rights of employees, the provisions thereof should be
liberally construed in favor of employees and strictly against the employer, unless otherwise intended by

or patent from the language of the statute itself. [Caltex Filipino Managers and Supervisors Association
vs. Court of Industrial Relations, 44 SCRA 350(1972)]
Feati University vs. Bautista, 18 SCRA 1191(1966)
Industrial Peace Act; Meaning of "employer".Congress, in the Industrial Peace Act, did not intend to
give a complete definition of "employer", but rather it intended the definition in section 2(c) of the law to
be complementary to what is commonly understood as employer. It intended that the term "employer" be
understood in a broad meaning.
Same; Educational institutions.Educational institutions, that are operated for profit, are included within
the term "employer" as contemplated in the Industrial Peace Act, since they are not among the exceptions
mentioned in section 2(c) of the law.
Jose D. Dula II
Atty. Gutierrez
Labor law; A certification proceeding is not a litigation, but an investigation of a non-adversary, factfinding character.This Courthas always stressed that a certification proceeding is not a litigation, in the
sense in which this term is ordinarily understood, but an investigation of a non-adversary, fact-finding
character in which the Court of Industrial Relations plays the part of a disinterested investigator seeking
merely to ascertain the desires of employees as to the matter of their representation. Such being the nature
of a certification proceeding, we find no cogent reason that should prevent the industrial court, in such a
proceeding, from inquiring into and satisfying itself about matter which may be relevant and crucial,
though seemingly beyond the purview of such a proceeding, to the complete realization of the well-known
purposes of a certification case.
Same; Lexical definition of employer.The lexical definition of "employer" is one who employs; one
who uses; one who engages or keeps in service. To employ is to provide work and pay for the service, to
engage one's service.
Same; Industrial Court should be allowed ample discretion in securing disclosure of facts in a certification
case.Such a situation may arise, as it did in the case at bar, where a group of pilots of a particular airline
anticipating their forced retirement or resignation on account of strained relations with the airline arising
from unfulfilled economic demands, decided to adopt an amendment to their organizations constitution
and by-laws in order to enable them to retain their membership standing therein even after the termination
of their employment with the employer concerned. The industrial court definitely should be allowed ample
discretion to secure a disclosure of circumstances which will enable it to act fairly in a certification case.
Same.An employer is one who employs the services of others; one for whom employees work and who
pays their wages or salaries. An employer includes any person acting in the interest of an employer
directly or indirectly. A university that engaged the services of professors, provided them work and paid
them compensation or salary for their services is an employer even if it considers itself a mere "lessee" of
the services of said professors.
Same; When adoption of amendment to a unions by-laws is legal.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 in substantial compliance with the ALPAP constitution and by-laws. Indeed, there is no
refutation of the fact 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.
Same; Industrial establishments.Section 2(c) of the Industrial Peace Act does not state that the
employers included in the definition of the term "employer" are only and exclusively "industrial
establishments". On the contrary, the term embraces all employers except those specifically excluded
therein.
Same; The term labor organization as defined by RA 875 is not limited to the employees of a particular
employer.This Court cannot likewise subscribe to the restrictive interpretation made by the court below
of the term labor oganization, which Section 2(e) of R.A. 875 defines as any union or association of
employees which exists, in whole or in part, for the purpose of collective bargaining or of dealing with
employers concerning terms and conditions of employment. The absence of the condition which the court
below would attach to the statutory concept of a labor organization, as being limited to the employees of a
particular employer, is quite evident from the law. The emphasis of the Industrial Peace Act is clearly on
the purposes for which a union or association of employees is established rather thanthat 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 defined 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 a labor dispute can exists regardless of whether the disputants
stand in the proximate relation of employer and employee.
Same.The Industrial Peace Act does not refer exclusively to industrial establishments and does not
confine its application thereto.
Same.For purposes of the Industrial Peace Act, a university is an industrial establishment because it is
operated for profit and it employs persons who work to earn a living. The term "industry", for purposes of
labor laws, should be given a broad meaning so as to cover all enterprises which are operated for profit
and which engage the services of persons who work to earn a living.
Same; Employee under the Industrial Peace Act.Under section 2(d) of the Industrial Peace Act, the term
"employee" embraces not only those who are usually and ordinarily considered as employees but also
those who have ceased as employees as a consequence of a labor dispute. An employee is one who is
engaged in the service of another; who performs services for another; who works for salary or wages.
Same.Professors and instructors, who are under contract to teach particular courses and are paid for
their services, are employees under the Industrial Peace Act. Teachers are employees.
Same.Striking professors and instructors of a university are employees because striking employees
retain their status as employees. Feati University vs. Bautista, 18 SCRA 1191(1966)
Air Line Pilots Association of the Philippines vs. Court of Industrial Relations, 76 SCRA 274(1977)
Same; When election of a set of officers by minority group in a union not binding.Moreover, this Court
cannot hold as valid and binding the election of Ben Hur Gomez as President of ALPAP. He was elected at
a meeting of only 45 ALPAP members called just one day after the election of Felix C. Gaston as
President of ALPAP who, as shown, received a majority of 180 votes out of a total membership of 270.
Same; A labor union may authorize a segment thereof to bargain collectively with the employer and in the
exercise of such authority to have custody of the unions fund and office and make use of the unions
name.In our opinion, it is perfectly within the powers and prerogatives of a labor organization, through
its duly elected officers, to authorized a segment of that organization to bargain collectively with a
particular employer, particularly where those constituting the segment share a common and
distinguishable interest, apart from the rest of their fellow union members, on matters that directly affect
the terms and conditions of their particular employment. As the circumstances pertinent to the case at bar

presently stand, ALPAP (Gaston) has extended recognition to ALPAP (Gomez) to enter and conclude
collective bargaining contracts with PAL. Having given ALPAP (Gomez) this authority, it would be clearly
unreasonable on the part of ALPAP (Gaston) to disallow the former a certain use of the office, funds and
name of ALPAP when such use is necessary or would be required to enable ALPAP (Gomez) to exercise,
in a proper manner, its delegated authority to bargain collectively with PAL. Clearly, an intelligently
considered adjustment of grievances and integration of the diverse and varying interests that not
infrequently and, often, unavoidably permeate the membership of a labor organization, will go a long way,
in achieving peace and harmony within the ranks of ALPAP. Of course, in the eventuality that the pilots
presently employed by PAL and who subscribe to the leadership of Ben Hur Gomez should consider it to
their better interest to have their own separate office, name and union funds, nothing can prevent them
from setting up a separate labor union. In that eventuality, whatever vested rights, interest or participation
they may have in the assets, including cash funds, of ALPAP as a result of their membership therein
should properly be liquidated in favor of such withdrawing members of the association.
Same; Non-compliance with the rule that all issues in a certified labor dispute should be ventilated in the
case where the same was docketed is not an error or jurisdiction.While it is correct, as submitted by
ALPAP (Gaston), that in the 1971 case of Philippine Federation of Petroleum Workers (PFPW) vs. CIR
(37 SCRA 716) this Court held that in a certified labor dispute all issues involved in the same should be
determined in the case where the certified dispute was docketed and that the parties should not be
permitted to isolate other germane issues or demands and reserve them for determination in the other cases
pending before other branches of the industrial court, noncompliance with this rule is at best an error in
procedure, rather than of jurisdiction, which is not beyond the power of this Court to review where
sufficient reason exist, a situation not obtaining in the case at bar.
Same; Employees who voluntarily retired and/or resigned from employment are not entitled to
reinstatement.After a thoroughgoing study of the records of these two consolidated petitions, this Court
finds that the matter of the reinstatement of the pilots who retired or resigned from PAL was ventilated
fully and adequately in the certification case in all its substantive aspects, including the allegation of the
herein petitioners that they were merely led to believe in good faith that in retiring or resigning from PAL
they were simply exercising their rights to engage in concerted activity. In the light of the circumstances
thus found below, it can be safely concluded that the mass retirement and resignation action of the herein
petitioners was intentionally planned to abort the effects of the October 7, 10 and 19, 1970 return-to-work
orders of the industrial court (which they, in fact, ignored for more than a week) by placing themselves
beyond the jurisdictional control of the said court through the umbrella of the constitutional prohibition
against involuntary servitude, thereby enabling them to pursue their main pressure objective of grounding
most, if not all, PAL flight operations. Clearly, the powers given to the industrial court in a certified labor
dispute will be meaningless and useless to pursue where its jurisdiction cannot operate.
Same; Same.We cannot consequently disagree with the court a quo when it concluded that the
actuations of the herein petitioners after they retired and resigned en massetheir retrieval of deposits and
other funds from the ALPAP Cooperative Credit Union on the ground that they have already retired or
resigned, their employment with another airline, the filing of a civil suit for the recovery of theirretirement
pay where they invoked the provision against involuntary servitude to obtain payment thereof, and their
repeated manifestations before the industrial court that their retirement and resignation were not sham, but
voluntary and intentionalare, in the aggregate, indubitable indications that the said pilots did
retire/resign from PAL with full awareness of the likely consequences of their acts. Their protestations of
good faith, after nearly a year of underscoring the fact that they were no longer employed with PAL,
cannot but appear to a reasonable mind as a late and regrettable ratiocination.
Jose D. Dula II
Atty. Gutierrez
Same; Strike as used in the statute means temporary stoppage of work.Parenthetically, contrary to
ALPAP (Gaston)s argument that the pilots retirement/resignation was a legitimate concerted activity,
citing Section 2(1) of the Industrial Peace Act which defines strike as any temporary stoppage of work
by the concerted action of employees as a result of an industrial dispute, it is worthwhile to observe that
as the law defines it, a strike means only a temporary stoppage of work. What the mentioned pilots did,
however, cannot be considered, in the opinion of this Court, as mere temporary stoppage of work. What
they contemplated was evidently a permanent cut-off of employment relationship with their erstwhile
employer, the Philippine Air Lines.
Same; Same; A legitimate concerted activity cannot be used to circumvent judicial orders or be tossed
around like a plaything.A legitimate concerted activity is a matter that cannot be used to circumvent
judicial orders or be tossed around like a plaything. Definitely, neither employers nor employees should be
allowed to make a judicial authority a now-youve-got-it-now-you-dont affair. The courts cannot
hopefully effectuate and vindicate the sound policies of the Industrial Peace Act and all our labor laws if
employees, particularly those who on account of their highly advance technical background and relatively
better life status are far above the general working class spectrum, will be permitted to defy and invoke the
jurisdiction of the courts whenever the alternative chosen will serve to feather their pure and simple
economic demands. Air Line Pilots Association of the Philippines vs. Court of Industrial Relations,
76 SCRA 274(1977)
Lopez Sugar Corporation vs. Secretary of Labor and Employment, 247 SCRA 1(1995)
Labor Standards; Legitimate Labor Organization; Certification Election; Petitioning union in a
certification election must be a legitimate labor organization in good standing.Indeed, the law did not
reduce the Med-Arbiter to an automaton which can instantly be set to impulse by the mere filing of a
petition for certification election. He is still tasked to satisfy himself that all the conditions of the law are
met, and among the legal requirements is that the petitioning union must be a legitimate labor organization
in good standing.
Same; Same; Same; The local chapter, as its principal, should also be a legitimate labor organization in
good standing.The petition for certification election, in the case at bench, was filed by the NACUSIPTUCP, a national labor organization duly registered with the DOLE under Registration Certificate No.
FED-402-6390-IP. The legitimate status of NACUSIP-TUCP might be conceded; being merely, however,
an agent for the local organization (the NACUSIP-TUCP Lopez Sugar Central Supervisory Chapter), the
federations bona fide status alone would not suffice. The local chapter, as its principal, should also be a
legitimate labor organization in good standing. Accordingly, in Progressive Development, we elucidated:
In the case of union affiliation with a federation, the documentary requirements are found in Rule 11,
Section 3(e), Book V of the Implementing Rules, which we again quote as follows: (c) 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 of accounts.For reporting purposes, the procedure governing the reporting of
independently registered unions, federations or national unions shall be observed.
Same; Same; Bargaining Power; 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.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 the 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.
Same; Same; Requisites for local or chapter to become a legitimate labor organization.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. Lopez Sugar Corporation vs. Secretary of
Labor and Employment, 247 SCRA 1(1995)
San Miguel Corp. Employees Union-PTGWO vs. Bersamira, 186 SCRA 496(1990)
Labor Law; Labor dispute exists when the controversy concerns the terms and conditions of employment.
While it is SanMigs submission that no employer-employee relationship exists between itself, on the
one hand, and the contractual workers of Lipercon and DRite on the other, a labor dispute can
nevertheless exist regardless of whether the disputants stand in the proximate relationship of employer
and employee (Article 212 [1] Labor Code, supra) provided the controversy concerns, among others, the
terms and conditions of employment or a change or arrangement thereof (ibid). Put differently, and as
defined by law, the existence of a labor dispute is not negatived by the fact that the plaintiffs and
defendants do not stand in the proximate relation of employer and employee.
Same; Jurisdiction; Civil Law; Claim for damages interwoven with labor dispute between the parties, to
be ventilated before administrative machinery.The claim of SanMig that the action below is for
damages under Articles 19, 20 and 21 of the Civil Code would not suffice to keep the case within the
jurisdictional boundaries of regular Courts. That claim for damages is interwoven with a labor dispute
existing between the parties and would have to be ventilated before the administrative machinery
established for the expeditious settlement of those disputes. To allow the action filed below to prosper
would bring about split jurisdiction which is obnoxious to the orderly administration of justice
(Philippine Communications, Electronics and Electricity Workers Federation vs. Hon. Nolasco, L-24984,
29 July 1968, 24 SCRA 321). San Miguel Corp. Employees Union-PTGWO vs. Bersamira, 186 SCRA
496(1990)
Gold City Integrated Port Service, Inc. vs. National Labor Relations Commission, 245 SCRA
627(1995)]
Labor Law; Strikes; A strike is defined as any temporary stoppage of work by the concerted action of
employees as a result of an industrial or labor dispute; What a labor dispute includes.A strike,
considered as the most effective weapon of labor, is defined as any temporary stoppage of work by the
concerted action of employees as a result of an industrial or labor dispute. A labor dispute includes any
controversy or matter concerning terms or conditions of employment or the association or representation
of persons in negotiating, fixing, maintaining, changing or arranging the terms and conditions of
employment, regardless of whether or not the disputants stand in the proximate relation of employers and
employees.
Same; Same; What transpired on April 30, 1985 was clearly a strike for the cessation of work by concerted
action resulted from a labor dispute.Private respondents and their co-workers stopped working and held
Jose D. Dula II
Atty. Gutierrez
the mass action on April 30, 1985 to press for their wages and other benefits. What transpired then was
clearly a strike, for the cessation of work by concerted action resulted from a labor dispute.
Same; Same; Arbiter correctly ruled that the strike was illegal for failure to comply with the requirements
of Article 264 paragraph (c) and (f) of the Labor Code.The complaint before the Labor Arbiter involved
the legality of said strike. The Arbiter correctly ruled that the strike was illegal for failure to comply with
the requirements of Article 264 (now Article 263) paragraphs (c) and (f) of the Labor Code.
Same; Same; The language of the law leaves no room for doubt that the cooling-off period and the sevenday strike ban after the strikevote report were intended to be mandatory.As we stated in the case of
National Federation of Sugar Workers v. Ovejera, the language of the law leaves no room for doubt that
the cooling-off period and the seven-day strike ban after the strike-vote report were intended to be
mandatory.
Same; Same; The strike on April 30, 1985 was illegal for failure to comply with the requirements of the
law.From the foregoing, it is patent that the strike on April 30, 1985 was illegal for failure to comply
with the requirements of the law.
Same; Same; Distinction between workers and union officers who participated in illegal strikes.A union
officer who knowingly participates in an illegal strike and any worker or union officer who knowingly
participates in the commission of illegal acts during a strike may be declared to have lost their
employment status. An ordinary striking worker cannot be terminated for mere participation in an illegal
strike. There must be proof that he committed illegal acts during a strike. A union officer, on the other
hand, may be terminated from work when he knowingly participates in an illegal strike, and like other
workers, when he commits an illegal act during a strike.
Same; Dismissal; Reinstatement; An employee is entitled to reinstatement and to his full backwages when
he is unjustly dismissed.Under the law, an employee is entitled to reinstatement and to his full
backwages when he is unjustly dismissed.
Same; Same; Same; Reinstatement and backwages are separate and distinct reliefs given to an illegally
dismissed employee.Rein-statement means restoration to a state or condition from which one had been
removed or separated. Reinstatement and backwages are separate and distinct reliefs given to an illegally
dismissed employee.
Same; Same; Well-settled is it that separation pay shall be allowed only in those instances where the
character.Hence, an employee dismissed for causes other than those cited above is not entitled to
separation pay. Well-settled is it that separation pay shall be allowed only in those instances where the
character.
Same; Same; Backwages; Backwages is a form of relief that restores the income that was lost by reason of
unlawful dismissal.Back-wages, on the other hand, is a form of relief that restores the income that was
lost by reason of unlawful dismissal.
Same; Same; Same; There must generally be unjust or illegal dismissal from work, before reinstatement
and backwages may be granted.It is clear from the foregoing summary of legal provisions and
jurisprudence that there must generally be unjust or illegal dismissal from work, before reinstatement and

backwages may be granted. And in cases where reinstatement is not possible or when dismissal is due to
valid causes, separation pay may be granted.
Same; Same; A worker merely participating in an illegal strike may not be terminated from his
employment.Under Article 264 of the Labor Code, a worker merely participating in an illegal strike
may not be terminated from his employment. It is only when he commits illegal acts during a strike that he
may be declared to have lost his employment status. Since there appears no proof that these union
members committed illegal acts during the strike, they cannot be dismissed. The striking union members
among private respondents are thus entitled to reinstatement, there being no just cause for their dismissal.
Same; Same; For knowingly participating in an illegal strike, the law mandates that a union officer may be
terminated from employ-ment.The fate of private respondent-union officers is different. Their insistence
on unconditional reinstatement or separation pay and backwages is unwarranted and unjustified. For
knowingly participating in an illegal strike, the law mandates that a union officer may be terminated from
employment.
Same; Same; The law, in using the word may, grants the employer the option of declaring a union
officer who participated in an illegal strike as having lost his employment.Notwithstanding the fact that
INPORT previously accepted other union officers and that the screening required by it was uncalled for,
still it cannot be gainsaid that it possessed the right and prerogative to terminate the union officers from
service. The law, in using the word may, grants the employer the option of declaring a union officer who
participated in an illegal strike as having lost his employment. [Gold City Integrated Port Service, Inc.
vs. National Labor Relations Commission, 245 SCRA 627(1995)]
Radio Communications of the Phil. vs. Phil. Communications Electronics & Electricity Workers
Federation (FCWF), 65 SCRA 82(1975)
Labor laws; Court of Industrial Relations; Labor court is not bound by technical rules of evidence.
While it is true that labor cases, especially those involving claims for compensation due the workers, must
be resolved on the basis of all material facts, and it is the inescapable duty of all parties concerned,
including the court, to disregard all technical rules in barring and discovering them, on the other hand, it is
as important that said cases must be decided on time for the obvious reason that the claimants are not in a
position to engage in any long drawn proceedings without risking either their wherewithal or their
convictions. The courts cannot leave the progress of the case to the convenience of the parties,
particularly, the employer who can afford to keep it dragging. Accordingly, where the inquiry into the
material facts is unreasonably delayed by unwarranted and unexplained actuations of any of the parties, no
abuse of discretion is committed by the court if it deems the right of such offending party to present his
factual side of the issue waived.
Same; Presidential Decree No. 21; Scabs illegally hired by the employer do not enjoy the protection of
Presidential Decree No. 21.The members of movant union were hired or employed by petitioner in open
violation of the order of reinstatement of the Industrial Court and as such they cannot have any legal
standing as employees protected by Presidential Decree No. 21. It would be absurd if an employer were to
be required to seek prior clearance from the Department of Labor before he can layoff workers he has
hired as substitutes for strikers subsequently ordered reinstated by the courts, particularly if the employer
has, as in the instant case, hired said substitutes in violation of a restraining order not to hire anyone
without the permission of the court. The motion to intervene is, therefore, denied.
Same; Labor relations; Reinstatement; Backwages; Employees not reinstated in defiance of court order are
entitled to backwages.Employees and workers deprived of their means of livelihood in defiance of a
Jose D. Dula II
Atty. Gutierrez
judicial order the legality of which is beyond dispute do not have to remind the court of their right to get
compensated of their lost earnings upon their actual reinstatement. Award thereof should come as a matter
of course. For Us not to rule on this point now only to leave it for action by the National Labor Relations
Board and thereby give rise to another possible appeal to Us is to unnecessarily lengthen even more the
tortuous road already travelled by respondents in their effort to get what has been rightfully due them
since years ago. We would be recreant to our constitutional duty to give protection to labor that way.
Same; Same; Same; Same; Court may set fix amounts of backwages without any reference to deductions.
As to the amount of backwages, the Court applies the precedent recently set in Mercury Drug Co. vs.
CIR (L-23357, April 30, 1974, applied in NASSCO vs. CIR, L-31852 & L-32724, June 28, 1974 and
Almira, et al. vs. B.F. Goodrich Phil, Inc., L-34974, July 25, 1974.) of fixing the amount of backwages to
a just and reasonable level without qualification or deduction so as to avoid protracted delay in the
execution of the award for backwages due to extended hearings and unavoidable delays and difficulties
encountered in determining the earnings of the laid-off employees ordered to be reinstated with
backwages during the pendency of the case for purposes of deducting the same from the gross backwages
awarded. [Radio Communications of the Phil. vs. Phil. Communications Electronics & Electricity
Workers Federation (FCWF), 65 SCRA 82(1975)]
Kiok Loy vs. NLRC, 141 SCRA 179(1986)
Labor Law; Unfair Labor Practice; Collective Bargaining Agreement; Collective bargaining, concept of.
Collective bargaining which is defined as negotiations towards a collective agreement, is one of the
democratic frameworks under the New Labor Code, designed to stabilize the relation between labor and
management and to create a climate of sound and stable industrial peace. It is a mutual responsibility of
the employer and the Union and is characterized as a legal obligation. So much so that Article 249, par. (g)
of the Labor Code makes it an unfair labor practice for an employer to refuse to meet and convene
promptly and expeditiously in good faith for the purpose of negotiating an agreement with respect to
wages, hours of work, and all other terms and conditions of employment including proposals for adjusting
any grievance or question arising under such an agreement and executing a contract incorporating such
agreement, if requested by either party.
Same; Same; Same; Same; Preconditions for setting in motion mechanics of collective bargaining.
While it is a mutual obligation of the parties to bargain, the employer, however, is not under any legal duty
to initiate contract negotiation. The mechanics of collective bargaining is set in motion only when the
following jurisdictional preconditions are present, namely, (1) possession of the status of majority
representation of the employees representative in accordance with any of the means of selection or
designation provided for by the Labor Code; (2) proof of majority representation; and (3) a demand to
bargain under Article 251, par. (a) of the New Labor Code . . . . all of which preconditions are
undisputedly present in the instant case.
Same; Same; Same; Same; Companys refusal to make counter-proposal to the unions proposed collective
bargaining agreement, an indication of its bad faith.We are in total conformity with respondent NLRCs
pronouncement that petitioner Company is GUILTY of unfair labor practice. It has been indubitably
established that (1) respondent Union was a duly certified bargaining agent; (2) it made a definite request
to bargain, accompanied with a copy of the proposed Collective Bargaining Agreement, to the Company
not only once but twice which were left unanswered and unacted upon; and (3) the Company made no
counter proposal whatsoever all of which conclusively indicate lack of a sincere desire to negotiate. A
Companys refusal to make counter proposal if considered in relation to the entire bargaining process, may
indicate bad faith and this is specially true where the Unions request for a counter proposal is left
unanswered. Even during the period of compulsory arbitration before the NLRC, petitioner Companys

approach and attitudestalling the negotiation by a series of postponements, non-appearance at the
hearing conducted, and undue delay in submitting its financial statements, lead to no other conclusion
except that it is unwilling to negotiate and reach an agreement with the Union. Petitioner has not at any
instance, evinced good faith or willingness to discuss freely and fully the claims and demands set forth by
the Union much less justify its opposition thereto.
Same; Same; Same; Same; When unfair labor practice, committed; Case at bar.The case at bar is not a
case of first impression, for in the Herald Delivery Carriers Union (PAFLU) vs. Herald Publications the
rule had been laid down that unfair labor practice is committed when it is shown that the respondent
employer, after having been served with a written bargaining proposal by the petitioning Union, did not
even bother to submit an answer or reply to the said proposal. This doctrine was reiterated anew in
Bradman vs. Court of Industrial Relations wherein it was further ruled that while the law does not
compel the parties to reach an agreement, it does contemplate that both parties will approach the
negotiation with an open mind and make a reasonable effort to reach a common ground of agreement.
Same; Same; Same; Due process; Denial of due process, not a case of, where the employers failure to be
heard was due to the various postponements granted to it and failure to reply to the unions successive
letters to bring the company to the bargaining table.Petitioners aforesaid submittal failed to impress Us.
Considering the various postponements granted in its behalf, the claimed denial of due process appeared
totally bereft of any legal and factual support. As herein earlier stated, petitioner had not even honored
respondent Union with any reply to the latters successive letters, all geared towards bringing the
Company to the bargaining table. It did not even bother to furnish or serve the Union with its counter
proposal despite persistent requests made therefor. Certainly, the moves and over-all behavior of
petitioner-company were in total derogation of the policy enshrined in the New Labor Code which is
aimed towards expediting settlement of economic disputes. Hence, this Court is not prepared to affix its
imprimatur to such an illegal scheme and dubious maneuvers.
Same; Same; Same; Employer should not be allowed with impunity to resort to schemes feigning
negotiations by going through empty gestures; Findings of NLRC of reasonableness of any collective
bargaining agreement, accorded respect.We agree with the pronouncement that it is not obligatory upon
either side of a labor controversy to precipitately accept or agree to the proposals of the other. But an
erring party should not be tolerated and allowed with impunity to resort to schemes feigning negotiations
by going through empty gestures. More so, as in the instant case, where the intervention of the National
Labor Relations Commission was properly sought for after conciliation efforts undertaken by the BLR
failed. The instant case being a certified one, it must be resolved by the NLRC pursuant to the mandate of
P.D. 873, as amended, which authorizes the said body to determine the reasonableness of the terms and
conditions of employment embodied in any Collective Bargaining Agreement. To that extent, utmost
deference to its findings of reasonableness of any Collective Bargaining Agreement as the governing
agreement by the employees and management must be accorded due respect by this Court. [Kiok Loy vs.
NLRC, 141 SCRA 179(1986)]
Davao Integrated Port and Stevedoring Services Corporation vs. Olvida, 210 SCRA 553(1992)
Labor Law; Contracts; The CBA provision on emergency leaves with pay should be interpreted to mean
that an employee can avail of an emergency leave with pay per calendar year provided he has served at
least 6 months during the year he took his emergency leave.The Court finds the petitioners
interpretation of Section 4, Article VIII (emergency leave) more logical than the Arbitrators and the
Unions. The provision of the CBA is clear: (1) the employee must be a member of the Regular Labor
Pool; (2) he is entitled to only six (6) emergency leave with pay per calendar year; and (3) he must have
rendered service for at least six (6) months during the year when he took his emergency leave. The
Jose D. Dula II
Atty. Gutierrez
emergency leave may be staggered or it may last for any number of days as emergencies arise but the
employee is entitled only to six (6) days of emergency leave with pay per year. Since the emergency
leave is allowed to enable the employee to attend to an emergency in his family or household, it may be
taken at any time during the calendar year but he must render at least six months service for that year to be
entitled to collect his wages for the six (6) days of his emergency leave. Since emergencies are unexpected
and unscheduled happenings, it would be absurd to require the employee to render six (6) months service
before being entitled to take a six-day-emergency leave with pay for it would mean that no emergency
leave can be taken by an employee during the first six months of a calendar year.
Same; Same; Employer cannot require submission of training program before it pays the union agreed
Union Education and Training Fund.The Arbitrator did not abuse his discretion in ruling that the
respondent company should comply with its obligation to contribute to the Union Education and Training
Fund the amount of Twelve Thousand (P12,000.00) pesos per year by paying said amount to the Union at
the beginning of each and every year, or contributing P1,000.00 at the end of each and every month during
the lifetime of the CBA, at the option of the company. As correctly observed by the Arbitrator, the
employers demand for the submission of a seminar program is foreign to the language of the contract
with the union.Davao Integrated Port and Stevedoring Services Corporation vs. Olvida, 210 SCRA
553(1992)
Victoria vs. Inciong, 157 SCRA 339(1988)
Labor Laws; Dismissal.The purpose in requiring a prior clearance from the Secretary of Labor in cases
of shutdown or dismissal of employees is to afford the Secretary ample opportunity to examine and
determine the reasonableness of the request.
Same; Same; In case of petitioners dismissal, a report is required as provided under Section 11[f] of Rule
XIV of the Rules and Regulations implementing the Labor Code.We further agree with the Acting
Secretary of Labor that what was required in the case of petitioners dismissal was only a report as
provided under Section 11[f] of Rule XIV of the Rules and Regulations implementing the Labor Code
which provides: Every employer shall submit a report to the Regional Office in accordance with the form
presented by the Department on the following instances of termination of employment, suspension, lay-off
or shutdown which may be effected by the employer without prior clearance within five (5) days
thereafter: x xxxxxxxx
Same; Same; Jurisdiction.Employees and laborers in non-profit organizations are not covered by the
provisions of the Industrial Peace Act and Court of Industrial Relations (now RTC) has no jurisdiction to
entertain petitioners of labor organizations of said non-profit organizations for certification as the
exclusive bargaining representatives of said employees and laborers. [Victoria vs. Inciong, 157 SCRA
339(1988)
Caltex Filipino Managers and Supervisors Association vs. Court of Industrial Relations, 44 SCRA
350(1972)
Court of Industrial Relations; Jurisdiction; Power to issue labor injunctions.There can be no injunction
issued against any strike except in only one instance, that is, when a labor dispute arises in an industry
indispensable to the rational interest and such dispute is certified by the President of the Philippines to the
Court of Industrial Relations in compliance with Section 10 of Republic Act 875. An injunction in an
uncertified case must be based on the strict requirements of Section 9(d) of Republic Act 875; the purpose
of such an injunction is not to enjoin the strike itself, but only unlawful activities.

Same; Findings of fact; When subject to review.In ignoring strong evidence coming from the witnesses
of the Company damaging to its case as well as that adduced by the Association also damaging to the
Companys case, the respondent court clearly and gravely abused its discretion thereby justifying this
Court to review or alter its factual findings.
Strike; When matter of illegality thereof rendered moot and academic.The return-to-work agreement is
in the nature of a partial compromise between the parties and, more important, a labor contract. When the
company unqualifiedly bound itself in the return-to-work agreement that all employees will be taken back
with the same employee status prior to April 22, 1965, the Company thereby made manifest its intention
and conformity not to proceed with Case No. 1484-MC(1) relating to the illegality of the strike incident.
While there is a reservation in the return-to-work agreement that all court cases now pending shall
continue, including CIR Case No. 1484-MC, the same is to be construed bearing in mind the conduct and
intention of the parties. The failure to mention Case No. 1484-MC (1) while specifically mentioning Case
No. 1484-MC bars the Company from proceeding with the former especially in the light of the additional
specific stipulation that the strikers would be taken back with the same employee status prior to the strike
on April 22, 1965.
Jose D. Dula II
Atty. Gutierrez
Same; Same; Disaffiliation; Constitutional Law; Right of employees to join any labor organization
protected by Constitution; Certification election, its function.It was held in Philippine Labor Alliance
Counsel v. Bureau of Labor Relations, 76 SCRA 162, that: It is indisputable that the present controversy
would not have arisen if there were no mass disaffiliation from petitioning union. Such a phenomenon is
nothing new in the Philippine labor movement. Nor it is open to any legal objection. It is implicit in the
freedom of association explicitly ordained by the Constitution. There is then the incontrovertible right of
any individual to join an organization of his choice. That option belongs to him. A workingman is not to
be denied that liberty. He may be, as a matter of fact, more in need of it if the institution of collective
bargaining as an aspect of industrial democracy is to succeed. No obstacle that may possibly thwart the
desirable objective of militancy in labors struggle for better terms and conditions is then to be placed on
his way. Once the fact of disaffiliation has been demonstrated beyond doubt, as in this case, a certification
election is the most expeditious way of determining which labor organization is to be the exclusive
bargaining representative.
Republic Act 875; Unfair labor practices of employer; Statutory provisions construed liberally in favor of
employees.Substantial, credible and convincing evidence appear on record establishing beyond doubt
the charge of unfair labor practices in violation of Section 4(a), Nos. (1), (3), (4), (5) and (6), of Republic
Act 875. And pursuant to the mandate of Article 24 of the Civil Code of the Philippines that courts must
be vigilant for the protection of one at a disadvantageand here the Association appears to be at a
disadvantage in its relations with the Companyadequate affirmative relief, including backwages, must
be awarded to the strikers. It is high-time and imperative that in order to attain the laudable objectives of
Republic Act 875 calculated to safeguard the rights of employees, the provisions thereof should be
liberally construed in favor of employees and strictly against the employer, unless otherwise intended by
or patent from the language of the statute itself. [Caltex Filipino Managers and Supervisors Association
vs. Court of Industrial Relations, 44 SCRA 350(1972)]
Same; Same; Registration; A labor union is entitled to registration when it complies with all registration
requirements; Ministerial duty of the Bureau of Labor Relations to register labor unions.Petitioner
union, Vassar Industries Employees Union, filed certiorari proceedings against the Acting Director of the
Bureau of Labor Relations for his refusal to register the union on the ground that there is already a
registered collective bargaining agreement in the company. The union prayed that its application for
registration be given due course. The comment of the government counsel favored the stand of the labor
union. The Supreme Court held: As this is a certiorari proceeding, equitable in character, this Court is
empowered to grant the relief adequate and suitable under the circumstances so that justice in all its
fullness could be achieved. There is this affirmation in the comment of the then Acting Solicitor General
Vicente V. Mendoza as counsel for respondent Estrella: As long as an applicant union complies with all
of the legal requirements for registration, it becomes the BLRs ministerial duty to so register the union.
It suffices then to order that petitioner Union be registered, there being no legal obstacle to such a step and
the duty of the Bureau of Labor Relations being clear. [Vassar Industries Employees Union (VIEU) vs.
Estrella, 82 SCRA 280(1978)]
Part Two
Singer Sewing Machine Company vs. Drilon, 193 SCRA 270(1991)
Vassar Industries Employees Union (VIEU) vs. Estrella, 82 SCRA 280(1978)
Labor Law; Employer-Employee Relationship; The following elements are generally considered in the
determination of employer-employee relationship: (1) selection and engagement of the employee; (2)
payment of wages; (3) the power of dismissal; and (4) the power to control the employees conduct.The
present case mainly calls for the application of the control test, which if not satisfied, would lead us to
conclude that no employer-employee relationship exists. Hence, if the union members are not employees,
no right to organize for purposes of bargaining, nor to be certified as such bargaining agent can ever be
recognized. The following elements are generally considered in the determination of the employeremployee relationship; (1) the selection and engagement of the employee; (2) the payment of wages; (3)
the power of dismissal; and (4) the power to control the employees conductalthough the latter is the
most important element (Mafinco Trading Corporation v. Ople, 70 SCRA 139 [1976]; Development Bank
of the Philippines v. National Labor Relations Commission, 175 SCRA 537 [1989]; Rosario Brothers, Inc.
v. Ople, 131 SCRA 72 [1984];Broadway Motors Inc. v. NLRC, 156 SCRA 522 [1987]; Brotherhood Labor
Unity Movement in the Philippines v. Zamora, 147 SCRA 49 [1986]).
Labor Law; Labor Unions; Constitutional Law; Freedom of association; Employees right to form unions
to protect their interests statutorily and constitutionally recognized.An earlier decision, Federation
Obrera v. Noriel, 72 SCRA 24, sets forth the scope and amplitude of the right to freedom of association.
Clearly, what is at stake is the constitutional right to freedom of association on the part of employees.
Petitioner labor union was in the past apparently able to enlist the allegiance of the working force in the
AngloAmerican Tobacco Corporation. Thereafter, a number of such individuals joined private respondent
labor union. That is a matter clearly left to their sole uncontrolled judgment. There is this excerpt from Pan
American World Airways, Inc. v. Pan American Employees Association: There is both a constitutional
and statutory recognition that laborers have the right to form unions to take care of their interests vis-a-viz
their employees. Their freedom to form organizations would be rendered nugatory if they could not
choose their own leaders to speak on their behalf to bargain for them. It cannot be otherwise, for the
freedom to choose which labor organization to join is an aspect of the constitutional mandate of protection
to labor. x xxThe new Labor Code is equally explicit on the matter. Thus: The State shall assure the rights
of workers to self-organization, collective bargaining, security of tenure and just and humane conditions of
work.
Same; Same; Same; Control-test; Independent Contractors; Employer-employee relationship does not
exist between petitioner-company and its collecting agents considering that petitioner-company exercises
control only with respect to the result or amount of collection and not with respect to the means and
method of collection.The Agreement confirms the status of the collecting agent in this case as an
independent contractor not only because he is explicitly described as such but also because the provisions

permit him to perform collection services for the company without being subject to the control of the latter
except only as to the result of his work. After a careful analysis of the contents of the agreement, we rule
in favor of the petitioner. The requirement that collection agents utilize only receipt forms and report
forms issued by the Company and that reports shall be submitted at least once a week is not necessarily an
indication of control over the means by which the job of collection is to be performed. The agreement
itself specifically explains that receipt forms shall be used for the purpose of avoiding a co-mingling of
personal funds of the agent with the money collected on behalf of the Company. Likewise, the use of
standard report forms as well as the regular time within which to submit a report of collection are intended
to facilitate order in office procedures. Even if the report requirements are to be called control measures,
any control is only with respect to the end result of the collection since the requirements regulate the
things to be done after the performance of the collection job or the rendition of the service.
Same; Same; Same; Same; Same; The language of the agreement reveals that the designation as collection
agent does not create an employment relationship and that the applicant is to be considered at all times as
an independent contractor.A thorough examination of the facts of the case leads us to the conclusion
that the existence of an employer-employee relationship between the Company and the collection agents
cannot be sustained. The plain language of the agreement reveals that the designation as collection agent
does not create an employment relationship and that the applicant is to be considered at all times as an
independent contractor. This is consistent with the first rule of interpretation that the literal meaning of the
stipulations in the contract controls (Article 1370, Civil Code; La Suerte Cigar and Cigarette Factory v.
Director of Bureau of Labor Relations, 123 SCRA 679 [1983]). No such words as to hire and employ
are present.
Moreover, the agreement did not fix an amount for wages nor the required working hours. Compensation
is earned only on the basis of the tangible results produced, i.e., total collections made (Sarra v. Agarrado,
166 SCRA 625 [1988]). In Investment Planning Corp. of the Philippines v. Social Security System, 21
SCRA 924 [1967] which involved commission agents, this Court had the occasion to rule, thus: We are
convinced from the facts that the work of petitioners agents or registered representatives more nearly
approximates that of an independent contractor than that of an employee. The latter is paid for the labor he
performs, that is, for the acts of which such labor consists; the former is paid for the result thereof x xx.
xxx xxxxxx Even if an agent of petitioner should devote all of his time and effort trying to sell its
investment plans he would not necessarily be entitled to compensation therefor. His right to compensation
depends upon and is measured by the tangible results he produces.
Same; Same; Same; Art. 280 of the Labor Code is not the yardstick for determining the existence of an
employment relationship because it merely distinguishes between regular and casual employees.The
Court finds the contention of the respondents that the union members are employees under Article 280 of
the Labor Code to have no basis. The definition that regular employees are those who perform activities
which are desirable and necessary for the business of the employer is not determinative in this case. Any
agreement may provide that one party shall render services for and in behalf of another for a consideration
(no matter how necessary for the latters business) even without being hired as an employee. This is
precisely true in the case of an independent contractorship as well as in an agency agreement. The Court
agrees with the petitioners argument that Article 280 is not the yardstick for determining the existence of
an employment relationship because it merely distinguishes between two kinds of employees, i.e., regular
employees and casual employees, for purposes of determining the right of an employee to certain benefits,
to join or form a union, or to security of tenure. Article 280 does not apply where the existence of an
employment relationship is in dispute.
Same; Same; Unions; Since private respondents are not employees of the company, they are not entitled to
the constitutional right to join or form a labor organization for purposes of collective bargaining.The
Jose D. Dula II
Atty. Gutierrez
Court finds that since private respondents are not employees of the Company, they are not entitled to the
constitutional right to join or form a labor organization for purposes of collective bargaining. Accordingly,
there is no constitutional and legal basis for their union to be granted their petition for direct
certification. This Court made thispronouncement in La Suerte Cigar and Cigarette Factory v. Director of
Bureau of Labor Relations, supra: x xx The question of whether employer-employee relationship exists is
a primordial consideration before extending labor benefits under the workmens compensation, social
security, medicare, termination pay and labor relations law. It is important in the determination of who
shall be included in a proposed bargaining unit because it is the sine qua non, the fundamental and
essential condition that a bargaining unit be composed of employees. Failure to establish this juridical
relationship between the union members and the employer affects the legality of the union itself. It means
the ineligibility of the union members to present a petition for certification election as well as to vote
therein x xx. (At p. 689) [Singer Sewing Machine Company vs. Drilon, 193 SCRA 270(1991)]
Metrolab Industries, Inc. vs. Roldan-Confesor, 254 SCRA 182(1996)
Labor Law; Dismissal; Exercise of management prerogatives is not absolute but subject to limitations
imposed by law.This Court recognizes the exercise of management prerogatives and often declines to
interfere with the legitimate business decisions of the employer. However, this privilege is not absolute but
subject to limitations imposed by law.
Same; Secretary of Labor; Evidence; Factual findings of administrative agencies supported by substantial
evidence are accorded great respect and binds the Court.After a judicious review of the record, we find
no compelling reason to overturn the findings of the Secretary of Labor. We reaffirm the doctrine that
considering their expertise in their respective fields, factual findings of administrative agencies supported
by substantial evidence are accorded great respect and binds this Court.
Same; Labor Union; Prohibition to join labor organization extends to confidential employees or those who
by reason of their positions or nature of work are required to assist or act in a fiduciary manner to
managerial employees.Although Article 245 of the Labor Code limits the ineligibility to join, form and
assist any labor organization to managerial employees, jurisprudence has extended this prohibition to
confidential employees or those who by reason of their positions or nature of work are required to assist or
act in a fiduciary manner to managerial employees and hence, are likewise privy to sensitive and highly
confidential records. Metrolab Industries, Inc. vs. Roldan-Confesor, 254 SCRA 182(1996)
Reyes vs. Trajano, 209 SCRA 484(1992)
Labor Law; Words and Phrases; The right to self-organization includes the right not to form or join a
union.Logically, the right NOT to join, affiliate with, or assist any union, and to disaffiliate or resign
from a labor organization, is subsumed in the right to join, affiliate with, or assist any union, and to
maintain membership therein. The right to form or join a labor organization necessarily includes the right
to refuse or refrain from exercising said right. It is self-evident that just as no one should be denied the
exercise of a right granted by law, so also, no one should be compelled to exercise such a conferred right.
The fact that a person has opted to acquire membership in a labor union does not preclude his
subsequently opting to renounce such membership.
Same; Same; Same.The purpose of a certification election is precisely the ascertainment of the wishes
of the majority of the employees in the appropriate bargaining unit: to be or not to be represented by a
labor organization, and in the affirmative case, by which particular labor organization. If the results of the
election should disclose that the majority of the workers do not wish to be represented by any union, then
their wishes must be respected, and no union may properly be certified as the exclusive representative of

the workers in the bargaining unit in dealing with the employer regarding wages, hours and other terms
and conditions of employment. The minority employeeswho wish to have a union represent them in
collective bargainingcan do nothing but wait for another suitable occasion to petition for a certification
election and hope that the results will be different. They may not and should not be permitted, however, to
impose their will on the majoritywho do not desire to have a union certified as the exclusive workers'
benefit in the bargaining unitupon the plea that they, the minority workers, are being denied the right of
self-organization and collective bargaining. As repeatedly stated, the right of self-organization embraces
not only the right to form, join or assist labor organizations, but the concomitant, converse right NOT to
form, join or assist any labor union.
Same; INK employees have the right to participate in a certification election and vote for "No Union."
That the INK employees, as employees in the same bargaining unit in the true sense of the term, do have
the right of self-organization, is also in truth beyond question, as well as the fact that when they voted that
the employees in their bargaining unit should be represented by "NO UNION," they were simply
exercising that right of self-organization, albeit in its negative aspect. The respondents' argument that the
petitioners are disqualified to vote because they "are not constituted into a duly organized labor
union""but members of the INK which prohibits its followers, on religious grounds, from joining or
forming any labor organization"and "hence, not one of the unions which vied for certification as sole
and exclusive bargaining representative," is specious. Neither law, administrative rule nor jurisprudence
requires that only employees affiliated with any labor organization may take part in a certification
election. On the contrary, the plainly discernible intendment of the law is to grant the right to vote to all
bona fide employees in the bargaining unit, whether they are members of a labor organization or not,
Jose D. Dula II
Atty. Gutierrez
Same; Same; Same; Where private respondents-employees were not privy to the agreement between
petitioner and the previous bargaining representatives as to their exclusion from the bargaining union of
the rank-and-file or from forming their own union, they can never bind subsequent federations and unions;
Reason.Petitioner, in justification of its action, maintained that the exclusion of the members of the
private respondent from the bargaining union of the rank-and-file or from forming their own union was
agreed upon by petitioner corporation with the previous bargaining representatives namely: the General
Rubber Workers Union-PTGWO, the General Workers Union-NAFLU and the General Rubber Workers
Union (independent). Such posture has no leg to stand on. It has not been shown that private respondent
was privy to this agreement. And even if it were so, it can never bind subsequent federations and unions
particularly private respondent-union because it is a curtailment of the right to self-organization
guaranteed by the laber laws.
Same; Same; Same; Same; To avoid confusion and fulfill the policy of the Labor Code and to be
consistent with the ruling in the Bulletin case, the monthly-paid rank-and-file employees should be
allowed to join the union of daily paid rank-and-file employees or to form their own rank-and-file union.
However, to prevent any difficulty and to avoid confusion to all concerned and, more importantly, to
fulfill the policy of the New Labor Code as well as to be consistent with Our ruling in the Bulletin case,
supra, the monthly-paid rank-and-file employees should be allowed to join the union of the daily-paidrank-and-file employees of petitioner so that they can also avail of the CBA benefits or to form their own
rank and file union, without prejudice to the certification election that has been ordered. General Rubber
and Footwear Corporation vs. Bureau of Labor Relations, 155 SCRA 283(1987)
Knitjoy Manufacturing, Inc. vs. Ferrer-Calleja, 214 SCRA 174(1992)
Same; Failure to take part in previous elections no bar to right to participate in future elections.Neither
does the contention that petitioners should be denied the right to vote because they "did not participate in
previous certification elections in the company for the reason that their religious beliefs do not allow them
to form, join or assist labor organizations," persuade acceptance. No law, administrative rule or precedent
prescribes forfeiture of the right to vote by reason of neglect to exercise the right in past certification
elections. In denying the petitioners' right to vote upon these egregiously fallacious grounds, the public
respondents exercised their discretion whimsically, capriciously and oppressively and gravely abused the
same. Reyes vs. Trajano, 209 SCRA 484(1992)
General Rubber and Footwear Corporation vs. Bureau of Labor Relations, 155 SCRA 283(1987)
Labor; Labor Unions; Right to self-organization; Members who are not managerial employees but
considered rank-and-file employees have every right to self-organization or be heard through a duly
certified collective bargaining union; Reason.Thus, it can be readily seen from the above findings of the
Bureau of Labor Relations that the members of private respondent are not managerial employees as
claimed by petitioners but merely considered as rank-and-file employees who have every right to selforganization or to be heard through a duly certified collective bargaining union. The Supervisory power of
the members of private respondent union consists merely in recommending as to what managerial actions
to take in disciplinary cases. These members of private respondent union do not fit the definition of
managerial employees which We laid down in the case of Bulletin Publishing Corporation V. Sanchez
(144 SCRA 628). These members of private respondent union are therefore not prohibited from forming
their own collective bargaining unit since it has not been shown by petitioner that the responsibilities (of
these monthly-paid-employees) inherently require the exercise of discretion and independent judgment as
supervisors or that they possess the power and authority to lay down or exercise management policies.
Similarly, We held in the same case that Members of supervisory unions who do not fall within the
definition of managerial employees shall become eligible to join or assist the rank-and-file labor
organization, and if none exists, to form or assist in the forming of such rank-and-file organizations.
Labor Laws; One company-one union policy; Exceptions.The present Article 245 of the Labor Code
expressly allows supervisory employees who are not performing managerial functions to join, assist or
form their separate union but bars them from membership in a labor organization of the rank-and-file
employees. It reads: 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. This
provision obviously allows more than one union in a company. Even Section 2(c), Rule V, Book V of the
Implementing Rules and Regulations of the Labor Code, which seeks to implement the policy, also
recognizes exceptions. It reads: SEC. 2. Who may file.Any legitimate labor organization or the
employer, when requested to bargain collectively, may file the petition. The petition, when filed by a
legitimate labor organization shall contain, among others: x xx (c) description of the bargaining unit which
shall be the employer unit unless circumstances otherwise require; x xx. (Emphasis supplied) The usual
exception, of course, is where the employer unit has to give way to the other units like the craft unit, plant
unit, or a subdivision thereof; the recognition of these exceptions takes into account the policy to assure
employees of the fullest freedom in exercising their rights. Otherwise stated, the one company-one union
policy must yield to the right of the employees to form unions or associations for purposes not contrary to
law, to self-organization and to enter into collective bargaining negotiations, among others, which the
Constitution guarantees.
Same; Bargaining representatives for monthly-paid employees and daily or piece-rate employees;
Bargaining unit not same as employer unit.Furthermore, it is not denied that in the bargaining history of
KNITJOY, the CBA has been consistently limited to the regular rank-and-file employees paid on a daily or
piece-rate basis. On the other hand, the rank-and-file employees paid on a monthly basis were never
included within its scope. Respondent KMEUs membership is limited to the latter class of employees;
KMEU does not seek to dislodge CFW as the exclusive bargaining representative for the former. The

records further disclose that in the certification solicited by TUPAS and during the elections which
followed thereafter, resulting in the certification of CFW as the exclusive bargaining representative, the
monthly-paid employees were expressly excluded. Thus, the negotiations between CFW and KNITJOY
following such a certification could only logically refer to the rank-and-file employees paid on a daily or
piece-rate basis. Clearly therefore, KNITJOY and CFW recognize that insofar as the monthly-paid
employees are concerned, the latters constituting a separate bargaining unit with the appropriate union as
sole bargaining representative, can neither be prevented nor avoided without infringing on these
employees rights to form a union and to enter into collective bargaining negotiations. Stated differently,
KNITJOY and CFW recognize the fact that the existing bargaining unit in the former is notand has
never beenthe employer unit. Given this historical and factual setting, KMEU had the unquestioned and
undisputed right to seek certification as the exclusive bargaining representative for the monthly-paid rankand-file employees . . . xxx. Knitjoy Manufacturing, Inc. vs. Ferrer-Calleja, 214 SCRA 174(1992)
KatipunanngmgaManggagawasaDaungan vs. Ferrer-Calleja, 278 SCRA 531(1997)
Labor Law; Labor Unions; Appeals; Factual findings of quasijudicial agencies, like the Labor Department,
which have acquired expertise in matters entrusted to their jurisdiction are accorded by the Court not only
respect but finality if supported by substantial evidence.It is settled that factual findings of quasijudicial agencies, like the Labor Department, which have acquired expertise in matters entrusted to their
jurisdiction are accorded by this Court not only respect but finality if supported by substantial evidence.
Substantial evidence refers to that amount of relevant evidence which a reasonable mind may accept as
adequate to justify a conclusion.
Same; Same; Section 3, Rule V, Book V of the Omnibus Rules Implementing the Labor Code prohibits not
the registration of a new union but the holding of a certification election within one year from the date of
issuance of a final certification election result.Section 3, Rule V, Book V of the Omnibus Rules
Implementing the Labor Code, prohibits not the registration of a new union but the holding of a
certification election within one year from the date of issuance of a final certification election result.
Clearly, private respondents registration is not covered by the prohibition. In any event, the union
registration was effected in September 1990, a month before the secretary of labor issued his decision on
the result of the certification election on October 31, 1990. Hence, there was yet no certified bargaining
agent when the private respondent was registered as a union.
Same; Same; Section 6 of PD 1391 has nothing to do with the registration of a union.Very clearly, the
foregoing provision does not help petitioner. It has nothing to do with the registration of a union. It deals
only with petitions for certification election, intervention or disaffiliation and notwe hazard being
redundantto applications for registration of a new union.
Same; Same; Section 5, Rule II, Book V of the Omnibus Rules Implementing the Labor Code enumerates
the grounds for the denial of registration to local unions, and the existence of another union is not one of
these grounds.Moreover, the issue of which union truly represents the working force should be raised
during the certification election, not during the registration period. Indeed, a certification election provides
the most effective and expeditious mode to determine the real representatives of the working force in the
appropriate bargaining unit. It may be well to add that Section 5, Rule II, Book V of the Omnibus Rules
Implementing the Labor Code, enumerates the grounds for the denial of registration to local unions, and
the existence of another union is not one of these grounds. KatipunanngmgaManggagawasaDaungan
vs. Ferrer-Calleja, 278 SCRA 531(1997)
Pan American World Airways, Inc. vs. Pan American Employees Association, 27 SCRA 1202(1969)
Jose D. Dula II
Atty. Gutierrez
Labor laws; Court of Industrial Relations; Return-to-work order; Court can order return of strikers
pending resolution of dispute; Order not grave abuse of discretion.Considering that the case at bar was
certified by the President, with respondent Court exercising its broad authority of compulsory arbitration,
the discretion it possesses cannot be so restricted and emasculated that the mere f ailure to grant a plea to
exclude f rom the returnto-work order the union officials could be considered as tantamount to a grave
abuse thereof. As f ar back as 1957, the Supreme Court, speaking through Justice Labrador, categorically
stated: We agree with counsel for the Philippine Marine Radio Off icers Association that upon
certification by the President under section 10 of Republic Act 875, the case comes under the operation of
Commonwealth Act 103, which enforces compulsory arbitration in cases of labor disputes in industries
indispensable to the national interest when the President certifies the case to the Court of Industrial
Relations. The evident intention of the law is to empower the Court of Industrial Relations to act in such
cases, not only in the manner prescribed under Commonwealth Act 103, but with the same broad powers
and jurisdiction granted by that Act. If the Court of Industrial Relations is granted authority to f ind a
solution in an industrial dispute and such solution consists in ordering of employees to return back to
work, it cannot be contended that the Court of Industrial Relations does not have the power or jurisdiction
to carry that solution into effect. And of what use is its power of conciliation and arbitration if it does not
have the power and jurisdiction to carry into effect the-, solution it has adopted. Lastly, if the said court
has the power to fix the terms and conditions of employment, it certainly can order the return of the
workers with or without backpay as a term or condition of the employment. (Phil. Marine Radio Officers
Assn. vs. Court of Industrial Relations, 102 Phil. 374, 382383.)
Same; Same; Same; Refusal of company to accept employeesment. (Phil. Marine Radio Officers Assn. vs.
Court of Industrial ment displays what in the case at bar appears to be a grave but unwarranted distrust in
the union officials discharging their functions just because a strike was resorted to, then the integrity of the
collective bargaining process itself is called into question. It would have been different if there were a
rational basis for such fears, purely speculative in character. The record is bereft of ,the slightest indication
that any danger, much less one clear and present, is to be expected f rom their return to work. Necessarily,
the union officials have the right to feel offended by the fact that, while they will be paid their salaries in
the meanwhile, they would not be considered as fit persons to perform the duties pertaining to the
positions held by them. Far from being generous, such an offer could rightfully be considered insulting.
Same; Same; Same; Right to form unions; Freedom would be nugatory if employees cannot choose their
own officials.The greater offense is to the labor movement itself, more specifically to the right of selforganization. There is both a constitutional and statutory recognition that laborers have the right to form
unions to take care of their interests vis-a-vis their employers. Their freedom to form organizations would
be rendered nugatory if they could not choose their own leaders to speak on their behalf and to bargain for
them. [Pan American World Airways, Inc. vs. Pan American Employees Association, 27 SCRA
1202(1969)]
Union of Supervisors(R.B.)NATU vs. Secretary ofLabor, 109 SCRA 139(1981)
Labor Law; The fact that other employees-officers of the union were not dismissed even if they were
guilty of substantially same act of alleged insubordination, etc. as petitioner-employee does not
necessarily mean latter's dismissal not made due to his union activities, especially where latter appears to
be more militant than the others.To this, WE may ask the following: Why was not Caizares cited for
dereliction of duty when he also walked out of the meeting on February 12, 1974; failed to attend the
special meeting on February 26, 1974 despite notice; and walked out of the meeting on March 12, 1974
after Luna was physically ejected therefrom by security guards? The answers to these questions are
obvious: Caizares and the other union officers were not as active and militant in their defense of union
rights, much less did they pose any threat against the respondent bank's plan to control the funds of the

Provident Fund which was established as a result of the collective bargaining agreement. Only Luna posed
such threat. Understandably therefore, management wanted him out. Forgotten were his almost 22 years of
service to the respondent bank without any showing of any irregularity in the performance of his duties
during those long years.
Same; Same.All these circumstances taken together indubitably show that Luna's discharge was
discriminatory and constituted unfair labor practice under paragraph (5) Section 4 of the Industrial Peace
Act. He is therefore entitled to reinstatement with back wages pursuant to the policy to decree back wages
not exceeding three (3) years without requiring the parties to submit proof of compensation received from
other sources at the time of illegal dismissal until actual reinstatement, in order that judgment in favor of
an employee or laborer can be executed without delay (Luzon StevedoringCorp. vs. C.I.R., 61 SCRA
162). [Union of Supervisors(R.B.)NATU vs. Secretary ofLabor, 109 SCRA 139(1981)
Alliance of Nationalist and Genuine Labor Org. vs. SamahanngmgaManggagawangNagkakaisasa
Manila Bay Spinning Mills, 258 SCRA 371(1996)
Labor Law; Constitutional Law; Right to Self-Organization; All employees enjoy the right to selforganization and to form and join labor organizations of their own choosing for the purpose of collective
bargaining.Anent the first ground, we reiterate the rule that all employees enjoy the right to selforganization and to form and join labor organizations of their own choosing for the purpose of collective
bargaining. This is a fundamental right of labor and derives its existence from the Constitution. In
interpreting the protection to labor and social justice provisions of the Constitution and the labor laws,
rules or regulations, we have always adopted the liberal approach which favors the exercise of labor
rights.
Same; Same; Same; Right to Disaffiliation; Non-compliance with the procedure on disaffiliation, being
premised on purely technical grounds cannot rise above the fundamental right of self-organization.This
Court is not ready to bend this principle to yield to a mere procedural defect, to wit: failure to observe
certain procedural requirements for a valid disaffiliation. Non-compliance with the procedure on
disaffiliation, being premised on purely technical grounds cannot rise above the fundamental right of selforganization.
Same; Same; Same; Even before the onset of the freedom period, disaffiliation may be carried out when
there is a shift of allegiance on the part of the majority of the members of the union.Although P.D. 1391
provides: Item No. 6. No petition for certification election, for intervention and disaffiliation shall be
entertained or given due course except within the 60-day freedom period immediately preceeding the
expiration of a collective bargaining agreement, said law is definitely not without exceptions. Settled is
the rule that a local union has the right to disaffiliate from its mother union when circumstances warrant.
Generally, a labor union may disaffiliate from the mother union to form a local or independent union only
during the 60-day freedom period immediately preceding the expiration of the CBA. However, even
before the onset of the freedom period, disaffiliation may be carried out when there is a shift of allegiance
on the part of the majority of the members of the union.
Same; Same; Same; The mere act of affiliation does not divest the local union of its own personality,
neither does it give the mother federation the license to act independently of the local union. It only gives
rise to a contract of agency, where the former acts in representation of the latter.A local labor union is a
separate and distinct unit primarily designed to secure and maintain an equality of bargaining power
between the employer and their employee-members. A local union does not owe its existence to the
federation with which it is affiliated. It is a separate and distinct voluntary association owing its creation to
the will of its members. The mere act of affiliation does not divest the local union of its own
Jose D. Dula II
Atty. Gutierrez
personality,neither does it give the mother federation the license to act independently of the local union. It
only gives rise to a contract of agency where the former acts in representation of the latter.
Same; Same; Same.By SAMANA BAYs disaffiliation from ANGLO, the vinculum that previously
bound the two entities was completely severed. ANGLO was divested of any and all power to act in
representation of SAMANA BAY. Thus, any act performed by ANGLO affecting the interests and affairs
of SAMANA BAY, including the ouster of herein individual private respondents, is rendered without force
and effect. [Alliance of Nationalist and Genuine Labor Org. vs.
SamahanngmgaManggagawangNagkakaisasa Manila Bay Spinning Mills, 258 SCRA 371(1996)
Bautista vs. Inciong, 158 SCRA 665(1988)
Labor; Illegal dismissal; Labor union; A labor union can be considered an employer of persons who work
for it.There is nothing in the records which support the Deputy Minister's conclusion that the petitioner
is not an employee of respondent ALU. The mere fact that the respondent is a labor union does not mean
that it cannot be considered an employer of the persons who work for it. Much less should it be exempted
from the very labor laws which it espouses as a labor organization.
Same; Same; Same; Employer-employee relationship; Factors in ascertaining the existence of an
employer-employee relationship.In the case of Brotherhood Labor Unity Movement in the Philippines
v. Zamora, (147 SCRA 49, 54), we outlined the factors in ascertaining an employer-employee relationship:
ln determining the existence of an employer-employee relationship, the elements that are generally
considered are the following: (a) the selection and engagement of the employee; (b) the payment of
wages; (c) the power of dismissal; and (d) the employer's power to control the employee with respect to
the means and methods by which the work is to be accomplished. It is the so-called 'control test' that is the
most important element (Investment Planning Corp. of the Phils. v. The Social Security System, 21 SCRA
924; Mafinco Trading Corp. y. Ople, supra, and Rosario Brothers, Inc. v. Ople, 131 SCRA 72.)"
Same; Same; Same; Same; Petitioner as an employee of respondent labor union in case at bar, proven.In
the case at bar. the Regional Director correctly found that the petitioner was an employee of the
respondent union as reflected in the latter's individual payroll sheets and shown by the petitioner's
membership with the Social Security System (SSS) and the respondent union's share of remittances in the
petitioner's favor. Even more significant, is the respondent union's act of filing a clearance application
with the MOL to terminate the petitioner's services. Bautista was selected and hired by the Union. He was
paid wages by the Union, ALU had the power to dismiss him as indeed it dismissed him. And definitely,
the Union tightly controlled the work of Bautista as one of its organizers. There is absolutely no factual or
legal basis for Deputy Minister Inciong's decision.
Same; Same; Same; If employee's reinstatement is not feasible, the employee shall be paid, separation pay
by the employer; Case at bar.We are, thus, constrained to reverse the findings of the respondent Deputy
Minister. However, the records show that antipathy and antagonism between the petitioner and the
respondent union militate against the former's reinstatement. ALU would not want to have a union
organizer whom it does not trust and who could sabotage its efforts to unionize commercial and industrial
establishments. Severance pay, therefore, is more proper and in order. [Bautista vs. Inciong, 158 SCRA
665(1988)]
Kapatiransa Meat and Canning Division vs. Ferrer-Calleja, 162 SCRA 367(1988)]
Labor; Labor Union; Right to self-organization; The right of members of the IglesianiKristo sect not to
join a labor union for being contrary to their religious beliefs does not bar the members of that sect from

forming their own union; Reason.After deliberating on the petition and the documents annexed thereto,
We find no merit in the petition. The public respondent did not err in dismissing the petitioners appeal in
BLR Case No. A-12-389-87. This Courts decision in Victoriano vs. Elizalde Rope Workers Union, 59
SCRA 54, upholding the right of members of the IGLESIA NI KRISTO sect not to join a labor union for
being contrary to their religious beliefs, does not bar the members of that sect from forming their own
union. The public respondent correctly observed that the recognition of the tenets of the sect x xx should
not infringe on the basic right of self-organization granted by the constitution to workers, regardless of
religious affilia-tion.
Same; Same; Same; Fact that TUPAS was able to negotiate a new CBA with ROBINA does not foreclose
the right of the rival union NEW ULO to challenge TUPAS claim to majority status.The fact that
TUPAS was able to negotiate a new CBA with ROBINA within the 60-day freedom period of the existing
CBA, does not foreclose the right of the rival union, NEW ULO, to challege TUPAS claim to majority
status, by filing a timely petition for certification election on October 13, 1987 before TUPAS old CBA
expired on November 15, 1987 and before it signed a new CBA with the company on December 3, 1987.
As pointed out by Med-Arbiter Abdullah, a certification election is the best forum in ascertaining the
majority status of the contending unions wherein the workers themselves can freely choose their
bargaining representative thru secret ballot. Since it has not been shown that this order is tainted with
unfairness, this Court will not thwart the holding of a certification election. [Kapatiransa Meat and
Canning Division vs. Ferrer-Calleja, 162 SCRA 367(1988)]
Filoil Refinery Corporation vs. Filoil Supervisory & Confidential Employees Association, 46 SCRA
512(1972)
Labor law; Right of supervisors to form a union.Section 3 of the Industrial Peace Act explicitly
provides that employeesand this term includes supervisorsshall have the right to self-organization,
and to form, join or assist labor organizations of their own choosing for the purpose of collective
bargaining... and that individuals employed as supervisors... may form separate organizations of their
own. Indeed, it is well settled that in relation to his employer, a foreman or supervisor is an employee
within the meaning of the Act. For this reason, supervisors are entitled to engage in union activities and
any discrimination against them by reason thereof constitutes an unfair labor practice. (AG & P Co. of
Manila vs. C.I.R., 3 SCRA 672 [1961]).
Same; Same.Supervisors and confidential employees, even though they may exercise the prerogatives
of management as regards the rank and file employees are indeed employees in relation to their employer,
the company which is owned by the stockholders and bondholders (capital) and should therefore be
entitled under the law to bargain collectively with the top management with respect to their terms and
conditions of employment.
Same; Where confidential employees are few in number.Since the confidential employees are very few
in number and are by practice and tradition identified with the supervisors in their role as representatives
of management vis-a-vis the rank and file employees, such identity of interest should allow their inclusion
in the bargaining unit of supervisors-managers for purposes of collective bargaining in turn as employees
in relation to the company as their employer. This will fulfill the laws objective of insuring to them the
full benefit of their right to self-organization and to collective bargaining, which could hardly be
accomplished if the respondent associations membership were to be broken up into five separate
ineffective tiny units as urged by the company.
Same; Court of Industrial Relations enjoys wide leeway in determining appropriate bargaining unit.The
industrial court enjoys a wide discretion in determining the procedure necessary to insure the fair and free
Jose D. Dula II
Atty. Gutierrez
choice of bargaining representations by employees. Filoil Refinery Corporation vs. Filoil Supervisory
& Confidential Employees Association, 46 SCRA 512(1972)
Toyota Motor Philippines Corporation vs. Toyota Motor Philippines Corporation Labor Union, 268
SCRA 573(1997)
Labor Law; Labor Unions; Collective Bargaining; Certification Elections; Purpose of every certification
election is to determine the exclusive representative of employees in an appropriate bargaining unit for the
purpose of collective bargaining.The purpose of every certification election is to determine the
exclusive representative of employees in an appropriate bargaining unit for the purpose of collective
bargaining. A certification election for the collective bargaining process is one of the fairest and most
effective ways of determining which labor organization can truly represent the working force. In
determining the labor organization which represents the interests of the workforce, those interests must be,
as far as reasonably possible, homogeneous, so as to genuinely reach the concerns of the individual
members of a labor organization.
Same; Same; Same; Same; Labor Code has made it a statutory policy to prevent supervisory employees
from joining labor organizations consisting of rank-and-file employees as the concerns which involve
members of either group are normally disparate and contradictory.According to Rothenberg, an
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. In Belyca Corporation v. Ferrer-Calleja, we defined the bargaining unit as
the 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. This in mind, the Labor Code has made it a clear statutory policy to prevent
supervisory employees from joining labor organizations consisting of rank-and-file employees as the
concerns which involve members of either group are normally disparate and contradictory. Article 245
provides: 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.
Same; Same; Same; Same; 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.Clearly, based on this provision, a labor organization composed of both rank-and-file and
supervisory employees is no labor organization at all. It cannot, for any guise or purpose, be a legitimate
labor organization. Not being one, an organization which carries a mixture of rank-and-file and
supervisory employees cannot possess any of the rights of a legitimate labor organization, including 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.
Same; Same; Same; Same; Supervisory employees are those who, in the interest of the employer,
effectively recommend managerial actions if the exercise of such authority is not merely routinary or
clerical in nature but require the use of independent judgment.While there may be a genuine divergence
of opinion as to whether or not union members occupying Level 4 positions are supervisory employees, it
is fairly obvious, from a reading of the Labor Codes definition of the term that those occupying Level 5
positions are unquestionably supervisory employees. Supervisory employees, as defined above, are those

who, in the interest of the employer, effectively recommend managerial actions if the exercise of such
authority is not merely routinary or clerical in nature but require the use of independent judgment. Under
the job description for level five employees, such personnelall engineershaving a number of
personnel under them, not only oversee production of new models but also determine manpower
requirements, thereby influencing important hiring decisions at the highest levels. This determination is
neither routine nor clerical but involves the independent assessment of factors affecting production, which
in turn affect decisions to hire or transfer workers. The use of independent judgment in making the
decision to hire, fire or transfer in the identification of manpower requirements would be greatly impaired
if the employees loyalties are torn between the interests of the union and the interests of management. A
supervisory employee occupying a level five position would therefore find it difficult to objectively
identify the exact manpower requirements dictated by production demands.
Same; Same; Same; Same; The rationale behind the Codes exclusion of supervisors from unions of rankand-file employees is that such employees, while in the performance of supervisory functions, become the
alter ego of management in the making and the implementing of key decisions at the sub-managerial level.
This is precisely what the Labor Code, in requiring separate unions among rank-and-file employees on
one hand, and supervisory employees on the other, seeks to avoid. The rationale behind the Codes
exclusion of supervisors from unions of rank-and-file employees is that such employees, while in the
performance of supervisory functions, become the alter ego of management in the making and the
implementing of key decisions at the sub-managerial level. Certainly, it would be difficult to find unity or
mutuality of interests in a bargaining unit consisting of a mixture of rank-and-file and supervisory
employees. And this is so because the fundamental test of a bargaining units acceptability is whether or
not such a unit will best advance to all employees within the unit the proper exercise of their collective
bargaining rights. The Code itself has recognized this, in preventing supervisory employees from joining
unions of rank-and-file employees.
Same; Same; Same; Same; Not being a legitimate labor organization, it cannot possess the requisite
personality to file a petition for certification election.In the case at bar, as respondent unions
membership list contains the names of at least twenty-seven (27) supervisory employees in Level Five
positions, the union could not, prior to purging itself of its supervisory employee members, attain the
status of a legitimate labor organization. Not being one, it cannot possess the requisite personality to file a
petition for certification election.
Same; Same; Same; Same; The unions composition being in violation of the Labor Codes prohibition of
unions composed of supervisory and rank-and-file employees, it could not possess the requisite
personality to file for recognition as a legitimate labor organization.The foregoing discussion, therefore,
renders entirely irrelevant, the technical issue raised as to whether or not respondent union was in
possession of the status of a legitimate labor organization at the time of filing, when, as petitioner
vigorously claims, the former was still at the stage of processing of its application for recognition as a
legitimate labor organization. The unions composition being in violation of the Labor Codes prohibition
of unions composed of supervisory and rank-and-file employees, it could not possess the requisite
personality to file for recognition as a legitimate labor organization. In any case, the factual issue, albeit
ignored by the public respondents assailed Resolution, was adequately threshed out in the Med-Arbiters
September 28, 1994 Order.
Same; Same; Same; Same; Workers of an appropriate bargaining unit must be allowed to freely express
their choice in an election where everything is open to sound judgment and the possibility for fraud and
misrepresentation is absent.The holding of a certification election is based on clear statutory policy
which cannot be circumvented. Its rules, strictly construed by this Court, are designed to eliminate fraud
and manipulation. As we emphasized in Progressive Development Corporation v. Secretary, Department
Jose D. Dula II
Atty. Gutierrez
of Labor and Employment, the Courts conclusion should not be interpreted as impairing any unions right
to be certified as the employees bargaining agent in the petitioners establishment. Workers of an
appropriate bargaining unit must be allowed to freely express their choice in an election where everything
is open to sound judgment and the possibility for fraud and misrepresentation is absent. [Toyota Motor
Philippines Corporation vs. Toyota Motor Philippines Corporation Labor Union, 268 SCRA
573(1997)]
Dunlop Slazenger (Phils.), Inc. vs. Secretary of Labor and Employment, 300 SCRA 120(1998)
Labor Law; Unions; Certification Elections; Appropriate Bargaining Units; Words and Phrases; 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.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.
Same; Same; Same; Same; Supervisory Employees; Rank-and-File Employees; The test of supervisory
status 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.
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 employees title, but his job description.
Same; Same; Same; Same; Same; Same; Wages; The mode of compensation is usually a matter of
convenience and does not necessarily determine the nature and character of the job.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.
Same; Same; Same; Same; Same; Same; 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; A union has no legal right to file a petition for certification
election to represent a bargaining unit composed of supervisors for so long as it counts rank-and-file
employees among its members.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 exclusion-inclusion proceedings wherein those employees who are occupying rankand-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, viz.: x xx Clearly, based on this provision [Article 245,
Labor Code], a labor organization composed of both rank-and-file and supervisory employees is no labor
organization at all. It cannot, for any guise or purpose, be a legitimate labor organization. Not being one,
an organization which carries a mixture of rank-and-file and supervisory employees cannot possess any of
the rights of a legitimate labor organization, including 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.
[Dunlop Slazenger (Phils.), Inc. vs. Secretary of Labor and Employment, 300 SCRA 120(1998)]
Philippine Phosphate Fertilizer Corp. vs. Torres, 231 SCRA 335(1994)
Labor Law; Due Process; The essence of due process is simply an opportunity to be heard, or as applied to
administrative proceedings, an opportunity to explain ones side or an opportunity to seek a
reconsideration of the action or ruling complained of.We do not see it the way PHILPHOS does here.
The essence of due process is simply an opportunity to be heard or, as applied to administrative
proceedings, an opportunity to explain ones side or an opportunity to seek a reconsideration of the action
or ruling complained of. Where, as in the instant case, petitioner PHILPHOS agreed to file its position
paper with the Mediator-Arbiter and to consider the case submitted for decision on the basis of the
position papers filed by the parties, there was sufficient compliance with the requirement of due process,
as petitioner was afforded reasonable opportunity to present its side. Moreover, petitioner could have, if it
so desired, insisted on a hearing to confront and examine the witnesses of the other party. But it did not;
instead, it opted to submit its position paper with the Mediator-Arbiter. Besides, petitioner had all the
opportunity to ventilate its arguments in its appeal to the Secretary of Labor.
Same; Labor Unions; A supervisory union cannot represent the professional/technical and confidential
employees of petitioner whose positions we find to be more of the rank and file than supervisory.As
regards the second issue, we are with petitioner that being a supervisory union, respondent PMPI cannot
represent the professional/technical and confidential employees of petitioner whose positions we find to be
more of the rank and file than supervisory.
Same; R.A. 6715; Classification of employees.With the enactment in March 1989 of R.A. 6715,
employees were thereunder reclassified into three (3) groups, namely: (a) managerial employees, (b)
supervisory employees, and (c) rank and file employees. The category of supervisory employees is once
again recognized in the present law.
Same; Labor Code, Art.212; Supervisory employee defined.Article 212, par. (m), of the Labor Code, as
amended, provides that (s)upervisory 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. The definition of managerial employees
is limited to those having authority to hire and fire, while those who only recommend effectively the
hiring or firing or transfer of personnel are considered closer to rank and file employees. The exclusion
therefore of mid-level executives from the category of managers has brought about a third classification,
the supervisory employees. The peculiar role of supervisors is such that while they are not managers,
when they recommend action implementing management policy or ask for the discipline or dismissal of
Jose D. Dula II
Atty. Gutierrez
subordinates, they identify with the interests of the employer and may act contrary to the interests of the
rank and file.
Same; Labor Unions; These professional/technical employees are performing non-supervisory functions,
hence, they should be classified as rank and file employees. Consequently, they cannot be allowed to join
a union composed of supervisors.The certification of Personnel Officer Duhaylungsod that its
professional/technical employees occupy positions that are non-supervisory is evidence that said
employees belong to the rank and file. Quite obviously, these professional/technical employees cannot
effectively recommend managerial actions with the use of independent judgment because they are under
the supervision of superintendents and supervisors. Because it is unrefuted that these
professional/technical employees are performing non-supervisory functions, hence considered admitted,
they should be classified, at least for purposes of this case, as rank and file employees. Consequently,
these professional/technical employees cannot be allowed to join a union composed of supervisors.
Conversely, supervisory employees cannot join a labor organization of employees under their supervision
but may validly form a separate organization of their own. This is provided in Art. 245 of the Labor Code,
as amended by R.A. No. 6715, to wit: x xxx 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.
Same; Same; The intent of the law is to avoid a situation where supervisor s would merge with the rank
and file, or where the supervisors labor organization would represent conflicting interests.This is
precisely the situation which the law prohibits. It would create an obvious conflict of views among the
members, or at least between two (2) groups of members espousing opposing interests. The intent of the
law is to avoid a situation where supervisors would merge with the rank and file, or where the supervisors
labor organization would represent conflicting interests, especially where, as in the case at bar, the
supervisors will be commingling with those employees whom they directly supervise in their own
bargaining unit. Members of the supervisory union might refuse to carry out disciplinary measures against
their co-member rank and file employees.
Same; Same; What the law prohibits is a union whose membership comprises of supervisors merging with
the rank and file employees because this is where the conflict of interest may arise in the areas of
discipline, collective bargaining and strikes.Supervisors have the right to form their own union or labor
organization. What the law prohibits is a union whose membership comprises of supervisors merging with
the rank and file employees because this is where conflict of interests may arise in the areas of discipline,
collective bargaining and strikes. The professional/technical employees of petitioner therefore may join
the existing rank and file union, or form a union separate and distinct from the existing union organized by
the rank and file employees of the same company. [Philippine Phosphate Fertilizer Corp. vs. Torres,
231 SCRA 335(1994)]
PagkakaisangmgaManggagawasa Triumph Intl.-United Lumber and General Workers of the Phils.
vs. Ferrer-Calleja , 181 SCRA 119(1990)
Labor Law; Evidence; Factual findings of quasi-judicial agencies like the Bureau of Labor Relations
which are supported by substantial evidence binding upon the Court and entitled to great respect.In the
determination of whether or not the members of respondent union are managerial employees, we accord
due respect and, therefore, sustain the findings of fact made by the public respondent pursuant to the timehonored rule that findings of fact of quasi-judicial agencies like the Bureau of Labor Relations which are
supported by substantial evidence are binding on us and entitled to great respect considering their
expertise in their respective fields.

Same; Managerial employees, definition of.Managerial employee is one who is vested with powers or
prerogatives to lay down and execute management policies and/or to hire, transfer, suspend, lay-off, recall,
discharge, assign or discipline employees, or to effectively recommend such managerial action. All
employees not falling within this definition are considered rank and file employees for purposes of this
Book.
Same; Same; Test of supervisory or managerial status depends on whether a person possesses authority to
act in the interest of his employer and whether such authority is not merely routinary or clerical in nature
but requires the use of independent judgment.We have explicitly explained in the case of Franklin Baker
Company of the Philippines v. Trajano, 157 SCRA 416 [1988] that: The test of supervisory or
managerial status depends on whether a person possesses authority to act in the interest of his employer
in the matter specified in Article 212 (k) of the Labor Code and Section 1 (m) of its Implementing Rules
and whether such authority is not merely routinary or clerical in nature, but requires the use of
independent judgment. Thus, where such recommendatory powers as in the case at bar, are subject to
evaluation, review and final action by the department heads and other higher executives of the company,
the same, although present, are not effective and not an exercise of independent judgment as required by
law (National Warehousing Corp. v. CIR, 7 SCRA 602-603 [1963]).
Same; Same; Same; Findings that the supervisory employees sought to be represented by the respondent
union do not possess a managerial status settled.The public respondent, in its factual findings, found
that the supervisory employees sought to be represented by the respondent union are not involved in
policy-making and their recom-mendatory powers are not even instantly effective since the same are still
subject to review by at least three managerial heads (department manager, personnel manager and general
manager) before final action can be taken. Hence, it is evidently settled that the said employees do not
possess a managerial status. The fact that their work designations are either managers or supervisors is of
no moment considering that it is the nature of their functions and not the said nomenclatures or titles of
their jobs which determines their statuses.
Same; Same; Labor Organization; Managerial employees prohibited from joining, assisting or forming
any labor organization.Art. 245 of the aforementioned Code prohibits managerial employees from
joining, assisting or forming any labor organization. Hence, employees who had then formed supervisory
unions were classified either as managerial or rank-and-file depending on their functions in their
respective work assignments.
Same; Same; Same; Same; Managerial employees may join, assist or form a separate labor organization of
their own.Section 18 of the same Act retains the provision on the ineligibility of managerial employees
to join any labor organization. However, the right of supervisory employees to form their own union is
revived under the said section which states, in part, to wit: x xx 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.
Same; Same; Same; Findings that the employees sought to be represented by the respondent union are
rank-and-file employees adopted.Thus, the right of supervisory employees to organize under the
Industrial Peace Act is once more recognized under the present amendments to the Labor Code. (see
Adamson & Adamson, Inc., v. The Court of Industrial Relations, 127 SCRA 268 [1984]). In the absence of
any grave abuse of discretion on the part of the public respondent as to the status of the members of the
respondent union, we adopt its findings that the employees sought to be represented by the respondent
union are rank-and-file employees.
Jose D. Dula II
Atty. Gutierrez
Same; Same; Same; Same; Court impelled to disallow the holding of a certification election among the
workers sought to be represented by the respondent union for want of any proof that the right of said
workers to self-organization is being suppressed.In the case at bar, there is no dispute that the petitioner
is the exclusive bargaining representative of the rank-and-file employees of Triumph International. A
careful examination of the records of this case reveals no evidence that rules out the commonality of
interests among the rank-and-file members of the petitioner and the herein declared rank-and-file
employees who are members of the respondent union. Instead of forming another bargaining unit, the law
requires them to be members of the existing one. The ends of unionism are better served if all the rankand-file employees with substantially the same interests and who invoke their right to self-orgnization are
part of a single unit so that they can deal with their employer with just one and yet potent voice. The
employees bargaining power with management is strengthened thereby. Hence, the circumstances of this
case impel us to disallow the holding of a certification election among the workers sought to be
represented by the respondent union for want of proof that the right of said workers to self-organization is
being suppressed.
Same; Same; Same; Same; Same; Respondent unions CBA constituted a bar to the holding of the
certification election as petitioned by the respondent union with public respondent.Anent the correlative
issue of whether or not the contract-bar rule applies to the present case, Rule V, Section 3, Book V of the
Implementing Rules and Regulations of the Labor Code is written in plain and simple terms. It provides in
effect that if a collective bargaining agreement validly exists, a petition for certification election can only
be entertained within sixty (60) days prior to the expiry date of said agreement. Respondent unions
petition for certification election was filed on November 25, 1987. At the time of the filing of the said
petition, a valid and existing CBA was present between petitioner and Triumph International. The CBA
was effective up to September 24, 1989. There is no doubt that the respondent unions CBA constituted a
bar to theholding of the certification election as petitioned by the respondent union with public
respondent. [ PagkakaisangmgaManggagawasa Triumph Intl.-United Lumber and General
Workers of the Phils. vs. Ferrer-Calleja , 181 SCRA 119(1990)]
Paper Industries Corporation of the Philippines vs. Laguesma, 330 SCRA 295(2000)
Labor Law; Certification Elections; Managerial Employees; Words and Phrases; Managerial employees
are ranked as Top Managers, Middle Managers and First Line Managers; The mere fact that an employee
is designated manager does not ipso facto make him onedesignation should be reconciled with the
actual job description of the employee, for it is the job description that determines the nature of
employment.In United Pepsi-Cola Supervisory Union (UPSU) v. Laguesma, we had occasion to
elucidate on the term managerial employees. Managerial employees are ranked as Top Managers,
Middle Managers and First Line Managers. Top and Middle Managers have the authority to devise,
implement and control strategic and operational policies while the task of First-Line Managers is simply
to ensure that such policies are carried out by the rank-and-file employees of an organization. Under this
distinction, managerial employees therefore fall in two (2) categories, namely, the managers per se
composed of Top and Middle Managers, and the supervisors composed of First-Line Managers. Thus,
the mere fact that an employee is designated manager does not ipso facto make him one. Designation
should be reconciled with the actual job description of the employee, for it is the job description that
determines the nature of employment.
Same; Same; Same; Authority to Hire and Fire; Where the power to hire and fire is subject to evaluation,
review and final action by the department heads and other higher executives of the company, the same,
although present, is not effective and not an exercise of independent judgment as required by law.In the
petition before us, a thorough dissection of the job description of the concerned supervisory employees
and section heads indisputably show that they are not actually managerial but only supervisory employees

since they do not lay down company policies. PICOPs contention that the subject section heads and unit
managers exercise the authority to hire and fire is ambiguous and quite misleading for the reason that any
authority they exercise is not supreme but merely advisory in character. Theirs is not a final determination
of the company policies inasmuch as any action taken by them on matters relative to hiring, promotion,
transfer, suspension and termination of employees is still subject to confirmation and approval by their
respective superior. Thus, where such power, which is in effect recommendatory in character, is subject to
evaluation, review and final action by the department heads and other higher executives of the company,
the same, although present, is not effective and not an exercise of independent judgment as required by
law.
Same; Administrative Law; Due Process; No denial of due process can be ascribed to quasi-judicial
official when he refuses to allow a party to present additional evidence where said party, in the appeal
before the said official, even then had already submitted voluminous supporting documents.No denial
of due process can be ascribed to public respondent Undersecretary Laguesma for the latters denial to
allow PICOP to present additional evidence on the implementation of its program inasmuch as in the
appeal before the said public respondent, PICOP even then had already submitted voluminous supporting
documents. The record of the case is replete with position papers and exhibits that dealt with the main
thesis it relied upon. What the law prohibits is the lack of opportunity to be heard. PICOP has long harped
on its contentions and these were dealt upon and resolved in detail by public respondent Laguesma. We
see no reason or justification to deviate from his assailed resolutions for the reason that law and
jurisprudence aptly support them.
Same; Certification Elections; No obstacle must be placed to the holding of certification elections, for it is
a statutory policy that should not be circumvented.Considering all the foregoing, the fact that PICOP
voiced out its objection to the holding of certification election, despite numerous opportunities to ventilate
the same, only after respondent Undersecretary of Labor affirmed the holding thereof, simply bolstered
the public respondents conclusion that PICOP raised the issue merely to prevent and thwart the concerned
section heads and supervisory employees from exercising a rightgranted them by law. Needless to stress,,
no obstacle must be placed to the holding of certification elections, for it is a statutory policy that should
not be circumvented. [Paper Industries Corporation of the Philippines vs. Laguesma, 330 SCRA
295(2000)]
Jose D. Dula II
Atty. Gutierrez
employees and other documentary evidence on record vis-a-vis paragraph (m), Article 212 of the Labor
Code, as amended, and we find that only those employees occupying the position of route manager and
accounting manager are managerial employees. The rest, i.e., quality control manager, yard/transport
manager and warehouse operations manager are supervisory employees.
Same; Same; In the case of Workers Alliance Trade Unions (WATU) vs. Pepsi Cola Products, Phils., Inc.
(OS-MA-10-318-91), Court ruled that a route manager is a managerial employee within the context of the
definition of the law, and hence, ineligible to join, form or assist a union.The issue brought before us is
not of first impression. At one time, we had the occasion to rule upon the status of route manager in the
same company vis-a-vis the issue as to whether or not it is supervisory employee or a managerial
employee. In the case of Workers Alliance Trade Unions (WATU) vs. Pepsi Cola Products, Phils., Inc.
(OS-MA-10-318-91), 15 November 1991, we ruled that a route manager is a managerial employee within
the context of the definition of the law, and hence, ineligible to join, form or assist a union. We have once
more passed upon the logic of our Decision aforecited in the light of the issues raised in the instant appeal,
as well as the available documentary evidence on hand, and have come to the view that there is no cogent
reason to depart from our earlier holding. Route Managers are, by the very nature of their functions and
the authority they wield over their subordinates, managerial employees. The prescription found in Art. 245
of the Labor Code, as amended therefore, clearly applies to them.
Same; Same; Route managers cannot thus possibly be classified as mere supervisors.The route
managers cannot thus possibly be classified as mere supervisors because their work does not only involve,
but goes far beyond, the simple direction or supervision of operating employees to accomplish objectives
set by those above them. They are not mere functionaries with simple oversight functions but business
administrators in their own right. An idea of the role of route managers as managers per se can be gotten
from a memo sent by the director of metro sales operations of respondent company to one of the route
managers.
Same; Same; Court upheld in several of its decisions the right of supervisors to organize for purposes of
labor relations.For its part, the Supreme Court upheld in several of its decisions the right of supervisors
to organize for purposes of labor relations.
Labor Law; Labor Unions; A distinction exists between top and middle managers and first-level
managers/supervisors; Whether they belong to the first or the second category managers, vis-a-vis
employers, are likewise employees.As can be seen from this description, a distinction exists between
those who have the authority to devise, implement and control strategic and operational policies (top and
middle managers) and those whose task is simply to ensure that such policies are carried out by the rankand-file employees of an organization (first-level managers/supervisors). What distinguishes them from
the rank-and-file employees is that they act in the interest of the employer in supervising such rank-andfile employees. Managerial employees may therefore be said to fall into two distinct categories: the
managers per se, who compose the former group described above, and the supervisors who form the
latter group. Whether they belong to the first or the second category, managers, vis-a-vis employers, are,
likewise, employees.
Same; Same; The guarantee of organizational right in Art. 111, 8 not infringed by a ban against
managerial employees forming a union; There is a rational basis for prohibiting managerial employees
from forming or joining labor organizations.Nor is the guarantee of organizational right in Art. III, 8
infringed by a ban against managerial employees forming a union. The right guaranteed in Art. III, 8 is
subject to the condition that its exercise should be for purposes not contrary to law. In the case of Art.
245, there is a rational basis for prohibiting managerial employees from forming or joining labor
organizations. As Justice Davide, Jr., himself a constitutional commissioner, said in his ponencia in Philips
Industrial Development, Inc. v. NLRC: In the first place, all these employees, with the exception of the
service engineers and the sales force personnel, are confidential employees. Their classification as such is
not seriously disputed by PEO-FFW; the five (5) previous CBAs between PIDI and PEO-FFW explicitly
considered them as confidential employees. By the very nature of their functions, they assist and act in a
confidential capacity to, or have access to confidential matters of, persons who exercise managerial
functions in the field of labor relations. As such, the rationale behind the ineligibility of managerial
employees to form, assist or joint a labor union equally applies to them.
Same; Same; Court finds that only those employees occupying the position of route manager and
accounting manager are managerial employees.In Case No. OS-MA-10-318-91, entitled Workers
Alliance Trade Union (WATU) v. Pepsi-Cola Products Philippines, Inc., decided on November 13, 1991,
the Secretary of Labor found: We examined carefully the pertinent job descriptions of the subject
Remedial Law; Res Judicata; The doctrine of res judicata certainly applies to adversary administrative
proceedings; Proceedings for certification election are quasi judicial in nature and therefore decisions
rendered in such proceedings can attain finality.But the doctrine of res judicata certainly applies to
adversary administrative proceedings. As early as 1956, in Brillantes v. Castro, we sustained the dismissal
United Pepsi-Cola Supervisory Union (UPSU) vs. Laguesma, 288 SCRA 15(1998)

of an action by a trial court on the basis of a prior administrative determination of the same case by the
Wage Administration Service, applying the principle of res judicata. Recently, in Abad v. NLRC we
applied the related doctrine of stare decisis in holding that the prior determination that certain jobs at the
Atlantic Gulf and Pacific Co. were project employments was binding in another case involving another
group of employees of the same company. Indeed, in Nasipit Lumber Co., this Court clarified toward the
end of its opinion that the doctrine of res judicata applies . . . to judicial or quasi judicial proceedings and
not to the exercise of administrative powers. Now proceedings for certification election, such as those
involved in Case No.OS-MA-A-10-318-91 and Case No. OS-A-3-71-92, are quasi judicial in nature and,
therefore, decisions rendered in such proceedings can attain finality. United Pepsi-Cola Supervisory
Union (UPSU) vs. Laguesma, 288 SCRA 15(1998)
Southern Philippines Federation of Labor (SPFL) vs. Calleja, 172 SCRA 676(1989)
Labor; Certification election; Although the validity of the collective bargaining agreement was upheld as
the law among the parties, its provisions cannot override what is expressly provided by law that only
managerial employees are ineligible to join, assist or form any labor organization; The nature of the job
determines whether the employees fall under the definition of managerial as defined in the Labor Code.
Although we have upheld the validity of the CBA as the law among the parties, (see Planters Products,
Inc. v. NLRC, et al., G.R. No. 78524, January 20, 1989), its provisions cannot override what is expressly
provided by law that only managerial employees are ineligible to join, assist or form any labor
organization. (See Art. 247, Labor Code). Therefore, regardless of the challenged employees
designations, whether they are employed as Supervisors or in the confidential payrolls, if the nature of
their job does not fall under the definition of managerial as defined in the Labor Code, they are eligible
to be members of the bargaining unit and to vote in the certification election. Their right to selforganization must be upheld in the absence of an express provision of law to the contrary. It cannot be
curtailed by a collective bargaining agreement.
Same; Same; Same; Managerial employee, defined.As defined in the Labor Code and as we have held
in the case of Franklin Baker Company of the Phil. v. Trajano, (157 SCRA 416, 421-423, [1988]):A
managerial employee is defined as one who is vested with powers or prerogatives to lay down and
execute management policies and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or
discipline employees, or to effectively recommend such managerial actions. (Reynolds Phil. Corp. v.
Eslava, 137 SCRA [1985], citing Section 212 (K), Labor Code.)
Same; Same; Same; The functions of the positions are not managerial in nature if they only execute
approved and established policies leaving little or no discretion at all whether to implement said policies
or not.Thus, it is clear from the above provisions that the functions of the questioned positions are not
managerial in nature because they only execute approved and established policies leaving little or no
discretion at all whether to implement the said policies or not. The respondent Director, therefore, did not
commit grave abuse of discretion in dismissing the petitioners appeal from the Med Arbiters Order to
open and count the challenged ballots in denying the petitioners motion for reconsideration and in
certifying the respondent Union as the sole and exclusive bargaining representative of the rank-and-file
employees of respondent Apex.
Same; Same; Same; Nature of the job of the employees in the confidential payroll are not managerial;
Payment or non-payment of union dues cannot be the determining factor whether the employees are
excluded from the bargaining unit; It is not impossible for employees to be members of the bargaining unit
even though they are non-union members or not paying union dues.As regards the employees in the
confidential payroll, the petitioner has not shown that the nature of their jobs is classified as managerial
except for its allegation that they are considered by management as occupying managerial positions and
Jose D. Dula II
Atty. Gutierrez
highly confidential. Neither can payment or non-payment ofunion dues be the determining factor of
whether the challenged employees should be excluded from the bargaining unit since the union shop
provision in the CBA applies only to newly hired employees but not to members of the bargaining unit
who were not members of the union at the time of the signing of the CBA. It is, therefore, not impossible
for employees to be members of the barganing unit even though they are non-union members or not
paying union dues. [Southern Philippines Federation of Labor (SPFL) vs. Calleja, 172 SCRA
676(1989)]
Philtranco Service Enterprises vs. Bureau of Labor Relations, 174 SCRA 388(1989)
Labor Relations; Unions; Supervisors Unions; Managerial Employees; Supervisors performing
managerial functions are prohibited from forming or joining labor organizations.The Labor Code
recognizes two (2) principal groups of employees, namely, the managerial and the rank and file groups.
Thus, Art. 212 (k) of the Code provides: xxx xxxxxx k) Managerial employee is one who is vested with
powers or prerogatives to lay down and execute management policies and/or to hire, transfer, suspend,
lay-off, recall, discharge, assign or discipline employees, or to effectively recommend such managerial
actions. All employees not falling within this definition are considered rank and file employees for
purposes of this Book. In implementation of the aforequoted provision of the law, Section 11 of Rule II,
Book V of the Omnibus Rules implementing the Labor Code did away with existing supervisors unions
classifying the members either as managerial or rank and file employees depending on the work they
perform. If they discharge managerial functions, supervisors are prohibited from forming or joining any
labor organization. If they do not perform managerial work, they may join the rank and file union and if
none exists, they may form one such rank and file organization. This rule was emphasized in the case of
Bulletin Publishing Corp. v. Sanchez, (144 SCRA 628 [1986]).
Same; Same; Same; Same; Managerial and confidential employees are not qualified to join, much less,
form a union.It, therefore, follows that the members of the KASAMA KO who are professional,
technical, administrative and confidential personnel of PHILTRANCO performing managerial functions
are not qualified to join, much lessform a union. This rationalizes the exclusion of managers and
confidential employees exercising managerial functions from the ambit of the collective bargaining unit.
As correctly observed by Med-Arbiter Adap: x xx managerial and confidential employees were expressly
excluded within the operational ambit of the bargaining unit for the simple reason that under the law,
managers are disqualified to be members of a labor organization. On the other hand, confidential workers
were not included because either they were performing managerial functions and/or their duties and
responsibilities were considered or may be categorized as part and parcel of management as the primary
reason for their exclusion in the bargaining unit. The other categorized employees were likewise not
included because parties have agreed on the fact that the aforementioned group of workers are not
qualified to join a labor organization at the time the agreement was executed and that they were classified
as outside the parameter of the bargaining unit. (Rollo, pp. 28-29).
Same; Same; Collective Bargaining; One-Union One-Company Policy; Proliferation of unions in one
employer unit should be discouraged unless there are compelling reasons which would deny a certain class
of employees the right to self-organization.We are constrained to disallow the formation of another
union. There is no dispute that there exists a labor union in the company, herein intervenor, the
NAMAWU-MIF which is the collective bargaining agent of the rank and file employees in
PHILTRANCO. x xx We see no need for the formation of another union in PHILTRANCO. The qualified
members of the KASAMA KO may join the NAMAWU-MIF if they want to be union members, and to be
consistent with the one-union, one-company policy of the Department of Labor and Employment, and the
laws it enforces. As held in the case of General Rubber and Footwear Corp. v. Bureau of Labor Relations
(155 SCRA 283 [1987]): x xx It has been the policy of the Bureau to encourage the formation of an

employer unit unless circumstances otherwise require. The proliferation of unions in an employer unit is
discouraged as a matter of policy unless there are compelling reasons which would deny a certain class of
employees the right to self-organization for purposes of collective bargaining. This case does not fall
squarely within the exception. (Emphasis supplied). There are no compelling reasons in this case such as
a denial to the KASAMA KO group of the right to join the certified bargaining unit or substantial
distinctions warranting the recognition of a separate group of rank and file workers. Precisely,
NAMAWU-MIF intervened to make it clear it has no objections to qualified rank and file workers joining
its union.
Same; Same; Same; Same; Same; No substantial differences exist between the office employees vis-a-vis
field workers or drivers and conductors of petitioner-corporation that would warrant the formation of
separate unions other than the existing collective bargaining agent.The respondents state that this case is
an exception to the general rule considering that substantial differences exist between the office employees
or professional, technical, administrative and confidential employees vis-a-vis the field workers or drivers,
conductors and mechanics of the petitioner. Against this contention, we find that the substantial
differences in the terms and conditions of employment between the private respondents members and
the rest of the companys rank and file employees are more imagined than real. We agree with the
petitioner that the differences alleged are not substantial or significant enough to merit the formation of
another union, x xx There may be differences as to the nature of their individual assignments but the
distinctions are not enough to warrant the formation of separate unions. The private respondent has not
even shown that a separate bargaining unit would be beneficial to the employees concerned. Office
employees also belong to the rank and file. There is an existing employer wide unit in the company
represented by NAMAWU-MIF. And as earlier stated, the fact that NAMAWU-MIF moved to intervene in
the petition for certification election filed by KASAMA KO negates the allegation that substantial
differences exist between the employees concerned. We find a commonality of interest among them.
There are no compelling reasons for the formation of another union. [Philtranco Service Enterprises vs.
Bureau of Labor Relations, 174 SCRA 388(1989)]
Golden Farms, Inc. vs. Ferrer-Calleja, 175 SCRA 471(1989)
Labor; Collective Bargaining Agreement; Court respects the Collective Bargaining Agreement which was
freely and voluntarily entered into as the law between the parties for the duration of the period agreed
upon.Respondents herein do not dispute that the signatories (listed in Annex A, page 30, Rollo) to the
Petition for certification election subject of this case, were holding the positions of cashier, purchasers,
personnel officers, foremen and employees having access to confidential information such as accounting
personnel, radio and telegraph operators and head of various sections. It is also a fact that respondent
Union is the exclusive bargaining Unit of the rank-and-file employees of petitioner corporation and that an
existing CBA between petitioner corporation and the Union representing these rank-and-file employees
was still enforced at the time the Union filed a petition for certification election in behalf of the
aforementioned signatories. Respondents do not dispute the existence of said collective bargaining
agreement. We must therefore respect this CBA which was freely and voluntarily entered into as the law
between the parties for the duration of the period agreed upon. Until then no one can be compelled to
accept changes in the terms of the collective bargaining agreement.
Same; Same; Managerial employees decreed as disqualified from bargaining with management; Rationale
for such ruling; Managerial employee, definition of.Furthermore, the signatories to the petition for
certification election are the very type of employees by the nature of their positions and functions which
We have decreed as disqualified from bargaining with management in case of Bulletin Publishing Co. Inc.
vs. Hon. Augusto Sanchez, etc. (144 SCRA 628) reiterating herein the rationale for such ruling as follows:
if these managerial employees would belong to or be affiliated with a Union, the latter might not be
Jose D. Dula II
Atty. Gutierrez
assured of their loyalty to the Union in view of evident conflict of interests or that the Union can be
company-dominated with the presence of managerial employees in Union membership. A managerial
employee is defined under Art. 212 (k) of the new Labor Code as one who is vested with powers or
prerogatives to lay down and execute management policies and/or to hire, transfer, suspend, lay-off, recall,
discharge, assign or discipline employees, or to effectively recommend such managerial actions. All
employees not falling within this definitions are considered rank-and-file employees for purposes of this
Book.
Same; Same; Same; Ruling also holds true for confidential employees.This rationale holds true also for
confidential employees such as accounting personnel, radio and telegraph operators, who having access to
confidential information, may become the source of undue advantage. Said employee(s) may act as a spy
or spies of either party to a collective bargaining agreement. This is specially true in the present case
where the petitioning Union is already the bargaining agent of the rank-and-file employees in the
establishment. To allow the confidential employees to join the existing Union of the rank-and-file would
be in violation of the terms of the Collective Bargaining Agreement wherein this kind of employees by the
nature of their functions/positions are expressly excluded.
Same; Same; Same; Same; Company foremen cannot also join the existing union of the rank-and-file.
As to the company foremen, while in the performance of supervisory functions, they may be the extension
or alter ego of the management. Adversely, the foremen, by their actuation, may influence the workers
under their supervision to engage in slow down commercial activities or similar activities detrimental to
the policy, interest or business objectives of the company or corporation, hence they also cannot join.
[Golden Farms, Inc. vs. Ferrer-Calleja, 175 SCRA 471(1989)
Pier 8 Arrastre& Stevedoring Services, Inc. vs. Roldan-Confesor, 241 SCRA 294(1995)
Labor Law; Employees; The test of supervisory or managerial status is whether an employee possesses
authority to act in the interest of his employer, which authority is not merely routinary or clerical in nature
but requires use of independent judgment.This Court has ruled on numerous occasions that the test of
supervisory or managerial status is whether an employee possesses authority to act in the interest of his
employer, which authority is not merely routinary or clerical in nature but requires use of independent
judgment. What governs the determination of the nature of employment is not the employee's title, but his
job description. If the nature of the employee's job does not fall under the definition of "managerial" or
"supervisory" in the Labor Code, he is eligible to be a member of the rank-and-file bargaining unit.
Same; Same; Foremen fall squarely under the category of supervisory employees, and cannot be part of
rank and file unions.Foremen are chief and often especially-trained workmen who work with and
commonly are in charge of a group of employees in an industrial plant or in construction work. They are
the persons designated by the employer-management to direct the work of employees, and to superintend
and oversee them. They are representatives of the employer-management with authority over particular
groups of workers, processes, operations, or sections of a plant or an entire organization. In the modern
industrial plant, they are at once a link in the chain of command and the bridge between management and
labor. In the performance of their work, foremen definitely use their independent judgment and are
empowered to make recommendations for managerial action with respect to those employees under their
control. Foremen fall squarely under the category of supervisory employees, and cannot be part of rankand-file unions.
Jose D. Dula II
Atty. Gutierrez
Same; Same; Legal secretaries fall under the category of confidential employees.Upon the other hand,
legal secretaries are neither managers nor supervisors. Their work is basically routinary and clerical.
However, they should be differentiated from rank-and-file employees because they are tasked with, among
others, the typing of legal documents, memoranda and correspondence, the keeping of records and files,
the giving of and receiving notices, and such other duties as required by the legal personnel of the
corporation. Legal secretaries therefore fall under the category of confidential employees.
employees may handle will have to relate to their functions. From the foregoing functions, it can be
gleaned that the confidential information said employees have access to concern the employers internal
business operations. As held in Westinghouse Electric Corporation v. National Labor Relations Board, an
employee may not be excluded from appropriate bargaining unit merely because he has access to
confidential information concerning employers internal business operations and which is not related to
the field of labor relations.
Same; Same; Timekeeper and assistant timekeeper cannot be excluded from the bargaining unit.As for
the timekeeper and assistant timekeeper, it is clear from petitioner's own pleadings that they are neither
managerial nor supervisory employees. They are merely tasked to report those who commit infractions
against company rules and regulations. This reportorial function is routinary and clerical. They do not
determine the fate of those who violate company policy rules and regulations. It follows that they cannot
be excluded from the subject bargaining unit.
Same; Same; Same; Confidential employees who may be excluded from bargaining unit must be strictly
defined so as not to needlessly deprive many employees of their right to bargain collectively through
representatives of their choosing.It must be borne in mind that Section 3 of Article XIII of the 1987
Constitution mandates the State to guarantee to all workers the right to self-organization. Hence,
confidential employees who may be excluded from bargaining unit must be strictly defined so as not to
needlessly deprive many employees of their right to bargain collectively through representatives of their
choosing.
Same; Same; Collective Bargaining Agreement; Although a CBA has expired, it continues to have legal
effects as between the parties until a new CBA has been entered into.In the case of Lopez Sugar
Corporation vs. Federation of Free Workers, 189 SCRA 179 (1991), this Court reiterated the rule that
although a CBA has expired, it continues to have legal effects as between the parties until a new CBA has
been entered into. It is the duty of both parties to the CBA to keep the status quo, and to continue in full
force and effect the terms and conditions of the existing agreement during the 60-day freedom period
and/or until a new agreement is reached by the parties. [Pier 8 Arrastre& Stevedoring Services, Inc. vs.
Roldan-Confesor, 241 SCRA 294(1995)
Same; Same; Appropriate Bargaining Unit Defined.An appropriate bargaining unit may be defined as a
group of employees of a given employer, comprised of all or less than all of the entire body of employees,
which the collective interest of all the employees, consistent with equity to the employer, indicate to be
best suited to serve the reciprocal rights and duties of the parties under the collective bargaining
provisions of the law. [San Miguel Corp. Supervisors and Exempt Employees Union vs. Laguema,
277 SCRA 370(1997)]
Pepsi-Cola Products Philippines, Inc. vs. Secretary of Labor, 312 SCRA 104(1999)
San Miguel Corp. Supervisors and Exempt Employees Union vs. Laguema, 277 SCRA 370(1997)
Labor Law; Labor Unions; Criteria to Determine who are Confidential Employees.Confidential
employees are those who (1) assist or act in a confidential capacity, (2) to persons who formulate,
determine, and effectuate management policies in the field of labor relations. The two criteria are
cumulative, and both must be met if an employee is to be considered a confidential employeethat is, the
confidential relationship must exist between the employee and his supervisor, and the supervisor must
handle the prescribed responsibilities relating to labor relations.
Same; Same; Reason behind the confidential employee rule.The exclusion from bargaining units of
employees who, in the normal course of their duties, become aware of management policies relating to
labor relations is a principal objective sought to be accomplished by the confidential employee rule. The
broad rationale behind this rule is that employees should not be placed in a position involving a potential
conflict of interests. Management should not be required to handle labor relations matters through
employees who are represented by the union with which the company is required to deal and who in the
normal performance of their duties may obtain advance information of the companys position with regard
to contract negotiations, the disposition of grievances, or other labor relations matters.
Same; Same; Same; In determining the confidentiality of certain employees, a key question frequently
considered is the employees necessary access to confidential labor relations information.An important
element of the confidential employee rule is the employees need to use labor relations information.
Thus, in determining the confidentiality of certain employees, a key question frequently considered is the
employees necessary access to confidential labor relations information.
Same; Same; Same; An employee may not be excluded from appropriate bargaining unit merely because
he has access to confidential information concerning employers internal business operations and which is
not related to the field of labor relations.It is evident that whatever confidential data the questioned
Labor Law; Remedial Law; Action; Moot and Academic; It is unnecessary to indulge in academic
discussion of a moot question. The issue in G.R. No. 96663, whether or not the supervisors union can be
affiliated with a Federation with two (2) rank and file unions directly under the supervision of the former,
has thus become moot and academic in view of the Unions withdrawal from the federation. In a long line
of cases (NarcisoNakpil, et al. vs. Hon. Crisanto Aragon, et al., G.R. No.L-24087, January 22, 1980, 95
SCRA 85; Toribio v. Bidin, et al., G.R. No.L-37960, February 28, 1980, 96 SCRA 361; Gumaua v. Espino,
G.R. No. L-36188-37586, February 29, 1980, 96 SCRA 402), the Court dismissed the petition for being
moot and academic. In the case of F.C. Fisher v. Yangco Steamship Co., March 31, 1915, the Court held:
It is unnecessary, however to indulge in academic discussion of a moot question. x xxxxx The action
would have been dismissed at any time on a showing of the facts as they were . The question left for the
court was a moot one. Its Resolution would have been useless. Its judgment would have been impossible
of execution x x x.
Same; Same; Same; Same; Even if a case were moot and academic, a statement of the governing principle
is appropriate in the resolution of dismissal for the guidance not only of the parties but of others similarly
situated.In the case of University of San Agustin, Inc., et al. vs. Court of Appeals, et al., the court
resolved the case, ruling that even if a case were moot and academic, a statement of the governing
principle is appropriate in the resolution of dismissal for the guidance not only of the parties but of others
similarly situated. xx x
Same; Labor Unions; Certification Election; An order to hold a certification election is proper despite the
pendency of the petition for cancellation of the registration certificate of the respondent union. Anent the
issue of whether or not the Petition to cancel/revoke registration is a prejudicial question to the petition for
certification election, the following ruling in the case of Association of the Court of Appeals Employees
(ACAE) vs. Hon. PuraFerrer-Calleja, in her capacity as Director, Bureau of Labor Relations, et al., 203
SCRA 597, 598, [1991], is in point, to wit: x xx It is a well-settled rule that a certification proceedings is

not a litigation in the sense that the term is ordinarily understood, but an investigation of a nonadversarial
and fact finding character. (Associated Labor Unions [ALU] v. Ferrer-Calleja, 179 SCRA 127 [1989];
Philippine Telegraph and Telephone Corporation v. NLRC, 183 SCRA 451 [1990]). Thus, the technical
rules of evidence do not apply if the decision to grant it proceeds from an examination of the sufficiency
of the petition as well as a careful look into the arguments contained in the position papers and other
documents. At any rate, the Court applies the established rule correctly followed by the public respondent
that an order to hold a certification election is proper despite the pendency of the petition for cancellation
of the registration certificate of the respondent union. The rationale for this is that at the time the
respondent union filed its petition, it still had the legal personality to perform such act absent an order
directing the cancellation.
Same; Same; Court considers the position of confidential employees as included in the disqualification
found in Article 245 as if the disqualification of confidential employees were written in the provision.In
applying the doctrine of necessary implication, we took into consideration the rationale behind the
disqualification of managerial employees expressed in Bulletin Publishing Corporation v. Sanchez, thus x
xx if these managerial employees would belong to or be affiliated with a Union, the latter might not be
assured of their loyalty to the Union in view of evident conflict of interests. The Union can also become
companydominated with the presence of managerial employees in Union membership. Stated
differently, in the collective bargaining process, managerial employees are supposed to be on the side of
the employer, to act as its representatives, and to see to it that its interest are well protected. The employer
is not assured of such protection if these employees themselves are union members. Collective bargaining
in such a situation can become one-sided. It is the same reason that impelled this Court to consider the
position of confidential employees as included in the disqualification found in Art. 245 as if the
disqualification of confidential employees were written in the provision. If confidential employees could
unionize in order to bargain for advantages for themselves, then they could be governed by their own
motives rather than the interest of the employers. Pepsi-Cola Products Philippines, Inc. vs. Secretary of
Labor, 312 SCRA 104(1999)
Cooperative Rural Bank of Davao City, Inc. vs. Ferrer-Calleja, 165 SCRA 725(1988)
Labor Law; Certification Election; Remedial Law; Special Civil Action; Certiorari; The instant petition for
certiorari cannot be considered moot and academic simply because the certification election sought to be
enjoined went on as scheduled.Contrary to the view espoused by the Solicitor General, this case cannot
be considered moot and academic simply because the certification election sought to be enjoined went on
as scheduled. The instant Petition is one for certiorari as a special civil action. Errors of jurisdiction on the
part of the public respondents are alleged in the Petition itself. If the public respondents had indeed
committed jurisdictional errors, the action taken by both the Med-Arbiter and the Bureau Director will be
deemed null and void ab initio. And if this were so, the certification election would, necessarily, have no
legal justification. The arguments raised in the instant Petition strike at the very heart of the validity of the
certification election itself.
Same; Same; Statutes; Cooperative, defined under PD 175; A cooperative is defined to mean
organizations composed primarily of small producers and of consumers who voluntarily join together to
form business enterprises which they themselves control, own and patronize.However, under Section 2
of P.D. No. 175, a cooperative is defined to mean organizations composed primarily of small producers
and of consumers who voluntarily join together to form business enterprises which they themselves own,
control, and patronize. Its creation and growth was declared as a policy of the State as a means of
increasing the income and purchasing power of the low-income sector of the population in order to attain a
more equitable distribution of income and wealth.
Jose D. Dula II
Atty. Gutierrez
Same; Same; Collective Bargaining; Employees of cooperatives who are themselves members or coowners of the same cannot invoke the right to collective bargaining; the rule however does not apply to
those employees who are not members or co-owners of such cooperatives.An employee therefore of
such a cooperative who is a member and co-owner thereof cannot invoke the right to collective bargaining
for certainly an owner cannot bargain with himself or his co-owners. In the opinion of August 14, 1981 of
the Solicitor General he correctly opined that employees of cooperatives who are themselves members of
the cooperative have no right to form or join labor organizations for purposes of collective bargaining for
being themselves co-owners of the cooperative. However, in so far as it involves cooperatives with
employees who are not members or co-owners thereof, certainly such employees are entitled to exercise
the rights of all workers to organization, collective bargaining, negotiations and others as are enshrined in
the Constitution and existing laws of the country. [Cooperative Rural Bank of Davao City, Inc. vs.
Ferrer-Calleja, 165 SCRA 725(1988)
Central Negros Electric Cooperative, Inc. vs. Sec. of DOLE, 201 SCRA 584(1991)
Labor Law; Labor Organization; Collective Bargaining; Petitioner deemed to have submitted the issue of
membership withdrawal from the cooperative to the jurisdiction of the med-arbiter and now estopped from
questioning that same jurisdiction which it invoked in its motion to dismiss after obtaining an adverse
ruling thereon.From a perusal of petitioners motion to dismiss filed with the med-arbiter, it becomes
readily apparent that the sole basis for petitioners motion is the illegality of the employees membership
in respondent union despite the fact that they allegedly are still members of the cooperative. Petitioner
itself adopted the aforesaid argument in seeking the dismissal of the petition for certification election filed
with the medarbiter, and the finding made by the latter was merely in answer to the arguments advanced
by petitioner. Hence, petitioner is deemed to have submitted the issue of membership withdrawal from the
cooperative to the jurisdiction of the med-arbiter and it is now estopped from questioning that same
jurisdiction which it invoked in its motion to dismiss after obtaining an adverse ruling thereon.
Same; Same; Same; Argument of CENECO that the withdrawal was merely to subvert the ruling of the
Court in the Batangas case is without merit.The argument of CENECO that the withdrawal was merely
to subvert the ruling of this Court in the BATANGAS case is without merit. The case referred to merely
declared that employees who are at the same time members of the cooperative cannot join labor unions for
purposes of collective bargaining. However, nowhere in said case is it stated that member-employees are
prohibited from withdrawing their membership in the cooperative in order to join a labor union.
Same; Same; Same; The right to join an organization necessarily includes the equivalent right that to join
the same.It appears that the Articles of Incorporation of CENECO do not provide any ground for
withdrawal from membership which accordingly gives rise to the presumption that the same may be done
at any time and for whatever reason. In addition, membership in the cooperative is on a voluntary basis.
Hence, withdrawal therefrom cannot be restricted unnecessarily. The right to join an organization
necessarily includes the equivalent right not to join the same.
Same; Same; Same; Constitutional Law; The avowed policy of the state to afford full protection to labor
and to promote the primacy of free collective bargaining mandates that the employees right to form and
join unions for the purposes of collective bargaining be accorded the highest consideration.The right of
the employees to self-organization is a compelling reason why their withdrawal from the cooperative must
be allowed. As pointed out by CURE, the resignation of the member-employees is an expression of their
preference for union membership over that of membership in the cooperative. The avowed policy of the
State to afford full protection to labor and to promote the primacy of free collective bargaining mandates
that the employees right to form and join unions for purposes of collective bargaining be accorded the
highest consideration.

Same; Same; Same; Where a union has filed a petition for certification election, the mere fact that no
opposition is made does not warrant a direct certification.We have said that where a union has filed a
petition for certification election, the mere fact that no opposition is made does not warrant a direct
certification.
Same; Same; Same; The most effective way of determining which labor organization can truly represent
the working force is by certification election.While there may be some factual variances, the rationale
therein is applicable to the present case in the sense that it is not alone sufficient that a union has the
support of the majority. What is equally important is that everyone be given a democratic space in the
bargaining unit concerned. The most effective way of determining which labor organization can truly
represent the working force is by certification election. [Central Negros Electric Cooperative, Inc. vs.
Sec. of DOLE, 201 SCRA 584(1991)]
Metrolab Industries, Inc. vs. Roldan-Confesor, 254 SCRA 182(1996)]
Labor Law; Dismissal; Exercise of management prerogatives is not absolute but subject to limitations
imposed by law.This Court recognizes the exercise of management prerogatives and often declines to
interfere with the legitimate business decisions of the employer. However, this privilege is not absolute but
subject to limitations imposed by law.
Same; Secretary of Labor; Evidence; Factual findings of administrative agencies supported by substantial
evidence are accorded great respect and binds the Court.After a judicious review of the record, we find
no compelling reason to overturn the findings of the Secretary of Labor. We reaffirm the doctrine that
considering their expertise in their respective fields, factual findings of administrative agencies supported
by substantial evidence are accorded great respect and binds this Court.
Same; Labor Union; Prohibition to join labor organization extends to confidential employees or those who
by reason of their positions or nature of work are required to assist or act in a fiduciary manner to
managerial employees.Although Article 245 of the Labor Code limits the ineligibility to join, form and
assist any labor organization to managerial employees, jurisprudence has extended this prohibition to
confidential employees or those who by reason of their positions or nature of work are required to assist or
act in a fiduciary manner to managerial employees and hence, are likewise privy to sensitive and highly
confidential records. [Metrolab Industries, Inc. vs. Roldan-Confesor, 254 SCRA 182(1996)]
Mactan Workers Union vs. Aboitiz, 45 SCRA 577(1972)
Industrial Peace Act; Collective bargaining agreement; Effect of.The terms and conditions of a
collective bargaining contract constitute the law between the parties. Those who are entitled to its benefits
can invoke its provisions. In the event that an obligation therein imposed is not fulfilled, the aggrieved
party has the right to go to court for redress.
Some; Same; Collective bargaining agreement benefits extend even to non-union members.It is a wellsettled doctrine that the benefits of a collective bargaining agreement extend to the laborers and employees
in the collective bargaining unit, including those who do not belong to the chosen bargaining labor
organization.
Same; Same; Enforcement of collective bargaining agreement cognizable by ordinary courts.Section 88
of the Judiciary Act in providing for the original jurisdiction of city courts in civil cases provides: In all
civil actions, including those mentioned in Rules fifty-nine and sixty-two (now Rules 57 and 60) of the
Rules of Court, arising in his municipality or city, and not exclusively cognizable by the Court of First
Jose D. Dula II
Atty. Gutierrez
Instance, the municipal judge and the judge of a city court shall have exclusive original jurisdiction where
the value of the subject matter or amount of the demand does not exceed ten thousand pesos, exclusive of
interests and costs. The amount claimed by plaintiff on behalf of its members was P4,035.82 and if the
damages and attorneys fees be added, the total sum was less than P10,000.00. It is true that if an element
of unfair labor practice may be discerned in a suit for the enforcement of a collective bargaining contract,
then the matter is solely cognizable by the Court of Industrial Relations. It is equally true that as of the
date the lower court decision was rendered, the question of such enforcement had been held to be for the
regular courts to pass upon. [Mactan Workers Union vs. Aboitiz, 45 SCRA 577(1972)]
Part Three
Cebu Seamen's Association, Inc. vs. Ferrer-Calleja, 212 SCRA 50(1992)
Labor Law; Corporation Law; Jurisdiction; The Med-Arbiter and the BLR, on appeal, not the Securities
and Exchange Commission, have jurisdiction over release of union dues by different officers claiming to
represent a union.There is no doubt that the controversy between the aforesaid two sets of officers is an
intra-union dispute. Both sets of officers claim to be entitled to the release of the union dues collected by
the company with whom it had an existing CBA. The controversy involves claims of different
members/officers to certain rights granted under the labor code. Article 226 of the Labor Code vests upon
the Bureau of Labor Relations and Labor Relations Division the original and exclusive authority and
jurisdiction to act on all inter-union and intra-union disputes. Therefore, the Med-Arbiter originally, and
the Director on appeal, correctly assumed jurisdiction over the controversy.
Same; Same; It is the registration with BLR, not with SEC that makes a union a legitimate labor
organization.As stated in the findings of fact in the questioned resolution of Director Pura FerrerCalleja, on October 23, 1950, a group of deck officers organized the Cebu Seamens Association, Inc.,
(CSAI), a non-stock corporation and registered it with the Securities and Exchange Commission (SEC).
The same group registered the organization with the Bureau of Labor Relations (BLR) as Seamens
Association of the Philippines (SAPI). It is the registration of the organization with the BLR and not with
the SEC which made it a legitimate labor organization with rights and privileges granted under the Labor
Code.
Same; Same; Expulsion of an individual from the moribund corporate parent of a registered labor union
does not affect her membership from the latter.The expulsion of Nacua from the corporation, of which
she denied being a member, has however, not affected her membership with the labor union. In fact, in the
elections of officers for 1987-1989, she was re-elected as the president of the labor union. that Nacua was
already expelled from the union. Whatever acts their group had done in the corporation do not bind the
labor union. Moreover, Gabayoyo cannot claim leadership of the labor group by virtue of his having been
elected as a president of the dormant corporation CSAI.
Same; Same; Same.Public respondent Bureau of Labor Relations correctly ruled on the basis of the
evidence presented by the parties that 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, the former and not the latter association is entitled to the release and custody of union fees with
Aboitiz Shipping and other shipping companies with whom it had an existing CBA. [Cebu Seamen's
Association, Inc. vs. Ferrer-Calleja, 212 SCRA 50(1992)]

Progressive Development Corporation vs. Secretary, Department of Labor and Employment, 205
SCRA 802(1992)
Labor Law; Labor Organization; Certification Election; Court has repeatedly stressed that the holding of a
certification election is based on a statutory policy that cannot be circumvented.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.
Same; Same; Same; 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.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.
Same; Same; Same; Legitimate labor organization defined.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." (Italics 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."
Same; Same; Same; Same; A labor organization acquires legitimacy only upon registration with the BLR.
Ordinarily, a labor organization acquires legitimacy only upon registration with the BLR.
Same; Same; Same; Same; Same; When an unregistered union becomes a branch, local or chapter of a
federation, some of the aforementioned requirements for registration are no longer required.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.
Same; Same; Same; Same; Same; Same; The intent of the law 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 union's bargaining powers
respecting terms and conditions of labor.Undoubtedly, the intent of the law 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 union's
bargaining powers respecting terms and conditions of labor.
Same; Same; Same; Same; Same; Same; The certification and attestation requirements are preventive
measures against the commission of fraud.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.
Jose D. Dula II
Atty. Gutierrez
Same; Same; Same; Same; Same; Same; Requirements before a local or chapter becomes a legitimate
labor organization.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.
Same; Same; Same; Same; Same; Same; Same; Failure of the secretary of PDEU-Kilusan to certify the
required documents under oath is fatal to its acquisition of a legitimate status.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.
Same; Same; Same; Same; Same; Same; Where 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.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. [Progressive Development Corporation vs. Secretary,
Department of Labor and Employment, 205 SCRA 802(1992)]
Guijarno vs. Court of lndustrial Relations, 52 SCRA 307(1973)

Labor; Closed-shop agreement; Non-retroactivity thereof.A closed-shop provision in a collective
bargaining agreement is not to be given a retroactive effect so as to preclude its being applied to
employees already in the service.
Same; Same; Same; Reasons therefor.To further increase the effectiveness of labor organizations, a
closed-shop has been allowed. It could happen, though, that such a stipulation which assures further
weight to a labor union at the bargaining table could be utilized against minority groups or individual
members thereof. It is a basic fact in life that power in a collectivity could be the means of crushing
opposition and stifling the voices of those who are in dissent. The right to join others of life persuasion is
indeed valuable. It could happen though that whatever group may be in control of the organization may
simply ignore an individual's most-cherished desires and treat him as if he counts for naught. The
antogonism between him and the group becomes marked. Dissatisfaction if given expression may be
labeled disloyalty. In the labor field, the union under such circumstances may no longer be a haven of
refuge, but indeed as much of a potential foe as management itself. Precisely with the Anakan doctrine,
such an undesirable eventuality has been sought to be minimized, if not entirely avoided.
Same; Same; Remedy of employees unlawfully dismissed.Clearly, they should be reinstated with
backpay. In Salunga vs. Court of Industrial Relations, reinstatement was ordered but it was the labor union
that was held liable for the back wages. That is a rule dictated by fairness because management would not

have taken the action it did had it not been for the insistence of the labor union seeking to give effect to its
interpretation of a closed-shop provision, [Guijarno vs. Court of lndustrial Relations, 52 SCRA 307(1973)]
Jose D. Dula II
Atty. Gutierrez
union as the agent of the individual workers. The court in turn should certainly verify and assure itself of
the fact and extent of the authority of the union leadership to execute any compromise or settlement of the
judgment on behalf of the individual workers who are the real judgment creditors. [Heirs of Teodolo M.
Cruz vs. Court of Industrial Relations, 30 SCRA 917(1969)]
Heirs of Teodolo M. Cruz vs. Court of Industrial Relations, 30 SCRA 917(1969

Remedial law; Civil actions; Judicial compromise; When settlement of a case with approved of court may
be set aside on grounds of justice, equity and due process; Case af bar.The purported settlement in the
case at bar was set aside on grounds of justice, equity and due process based on the following
circumstances: (1) The conference set to take up forroally the proposed settlement was cancelled and
never held. Instead, the settlement was unilaterally drafted by defendant's counsel and executed ahead of
the scheduled hour of the conference by the union president (plaintiff) with 9 other members of the board
of directors of union, without the knowledge, advice and conformity of the union counsel, while defendant
was duly assisted by its two counsels; (2) The lack of due deliberation and caution in the trial judge's
instant approval of the settlement which disregarded the claim of the union members, resulting in lower
amount of P110,000 from the total awarded judgment amount of P428,756.74judgment liability of the
employer-defendant; (3) Lack of any express or specific authority of the president and majority of the
union board of directors to execute the agreements and scale down the estimated P423,756.74 judgment
liability of employer in favor of the individual union members to P110,000.
Labor law; Constitutional protection to labor; Duty of court to protect laborers from unjust exploitation by
oppressive employers and union leaders.Just as this Court has stricken down unjust exploitation of
laborers by oppressive employers, so will it strike down their unfair treatment by their own unworthy
leaders. Fair dealing is equally demanded of unions as well as of -employers in their dealings with
employees. Where the union leadership as in the case at bar was recreant in its duty towards the union
members, the courts must be vigilant to protect the individual interests of the union members.
Same; Unions; Mere agent of individual union members; Nature of relationship between union and its
members.The union has been evolved as an organization of collective strength for the protection of
labor against the unjust exactions of capital, but equally important is the requirement of fair dealing
between the union and its members, which is fiduciary in nature, and arises out of two factors: one is the
degree of dependence of the individual employee on the union organization; and the other, a corollary of
the first, is the comprehensive power vested in the union with respect to the individual, The union may be
considered but the agent of its members for the purpose of securing for them fair and just wages and good
working conditions and is subject to the obligation of giving the members as its principals all information
relevant to union and labor matters entrusted to it.
Same; Collective bargaining; As & rule, employer may rely on the authority of union representatives to
bind their union members; Exception; Case at bar.Under the philosophy of collective responsibility, an
employer who bargains in good faith should be entitled to rely upon the promises and agreements of the
union representatives with whom he must deal under the compulsion of law and contract The collective
bargaining process should be carried on between parties who can mutually respect and rely upon the
authority of each other. Where, however, collective bargaining process is not involved, and what is at stake
are back wages already earned by the individual workers by way of overtime, premium and differential
pay, and final judgment has been rendered in their favor, as in the present case, the real parties in interest
with direct material interest, as against the union which has only served as a vehicle for collective action
to enforce their just claims, are the individual workers themselves. Authority of the union to waive or quit
claim all or part of the judgment award in favor of the individual workers cannot be lightly presumed but
must be expressly granted, and the employer, as judgment debtor, must deal in all good faith with the
United Seamen's Union of the Phil. vs. Davao Shipowners Association, 20 SCRA 1226(1967)]
Labor Law; Strikes; Illegal strike.A strike by a union was considered illegal, where it appears that it was
declared even before the employers had answered the union's demands and it was in violation of an
agreement to maintain the status quo pending resolution of the union's petition for a certification election
and also in violation of a collective bargaining agreement. Moreover, the strikers resorted to violent
means.
Same; Test to determine illegality of strike.The legality or illegality of a strike depends, first, upon the
purpose for which it is maintained, and, second, upon the means employed in carrying it on. Thus, if the
purpose which the laborers intend to accomplish by means of a strike is trivial, unreasonable or unjust, or
if, in carrying on the strike, the strikers should commit violence or cause injuries to persons or damage to
property, the strike, although not prohibited by injunction, may be declared illegal, with the adverse
consequences to the strikers.
Same.Where in carrying out the strike, coercion, force, intimidation, violence with physical injuries,
sabotage, and. the use of unnecessary and obscene language or epithets were committed by the top
officials and members of the union in an attempt to prevent the other willing laborers to go to work, a
strike held under those circumstances cannot be justified in a regime of law for that would encourage
abuses and terrorism and would subvert the very purpose of the law. which provides for arbitration and
peaceful settlement of labor disputes.
Same; Unions; When labor union is wholesome.A labor organization is wholesome if it serves its
legitimate purpose of promoting the interests of labor without unnecessary labor disputes. That is why it is
given personality and recognition in concluding collective bargaining agreements. But if it is made use of
as a subterfuge, or as a means to subvert valid commitments, it defeats its own purpose, for it tends to
undermine the harmonious relations between management and labor. The situation does not deserve any
approving sanction from the Court. [United Seamen's Union of the Phil. vs. Davao Shipowners
Association, 20 SCRA 1226(1967)]
Phoenix Iron and Steel Corporation vs. Secretary of Labor and Employment, 244 SCRA 173(1995)]
Labor Relations; Legitimate Labor Organizations; Requirements.A local or chapter x x x 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 bylaws, 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.

Same; Same; Same; Mandatory Nature of Requirement; Submission of required documents and payment
of P50.00 registration fee becomes the Bureaus basis for approval of application for registration.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 the president is apparent.
The submission of the required documents (and payment of P50.00 registration fee) becomes the Bureaus
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 the law to a legitimate labor
organization. The employer naturally needs assurance that the union it is dealing with is a bonafide
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.
Same; Same; Same; Certification and attestation requirements are preventive measures against the
commission of fraud.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.
Same; Same; Same.Compared with what happened in the Progressive case, this situation before us now
is even worse. There are no books of account filed before the BLR, the constitution, by-laws and the list of
members who supposedly ratified the same were not attested to by the union president, and the
constitution and by-laws were not verified under oath. [Phoenix Iron and Steel Corporation vs. Secretary
of Labor and Employment, 244 SCRA 173(1995)
Protection Technology, Inc. vs. Secretary, Department of Labor and Employment, 242 SCRA
99(1995)
Labor Relations; Union Affiliation; Requirements; Books of account, consisting of ledgers, journals and
other accounting books, form part of the mandatory documentation requirements for registration of a
newly organized union affiliated with a federation.The principal issue here posed is whether books of
account, consisting of ledgers, journals and other accounting books, form part of the mandatory
documentation requirements for registration of a newly organized union affiliated with a federation, or a
local or chapter of such a federation, as a legitimate labor organization. The above issue was addressed
several years ago and answered in the affirmative by this Court in Progressive Development Corporation
v. Secretary, DOLE.
Same; Same; Same; Certification Election; Non-submission of such books of account is a ground to
oppose a petition for certification election.Non-submission of such books of account certified by and
attested to by the appropriate officer is a ground which the employer can invoke legitimately to oppose a
petition for certification election filed by the local or chapter concerned.
Same; Same; Same; Same; Books of Account.Books of account are quite different in their essential
nature from financial statements. In generally accepted accounting practice, the former consist of journals,
ledgers and other accounting books (which are registered with the Bureau of Internal Revenue) containing
a record of individual transactions wherein monies are received and disbursed by an establishment or
entity; entries are made on such books on a day-to-day basis (or as close thereto as is possible). Statements
Jose D. Dula II
Atty. Gutierrez
of accounts or financial reports, upon the other hand, merely summarize such individual transactions as
have been set out in the books of account and are usually prepared at the end of an accounting period,
commonly corresponding to the fiscal year of the establishment or entity concerned. Statements of account
and financial reports do not set out or repeat the basic data (i.e., the individual transactions) on which they
are based and are, therefore, much less informative sources of cash flow information. Books of account
are kept and handled by bookkeepers (employees) of the company or agency; financial statements may be
audited statements, i.e., prepared by external independent auditors (certified public accountants).
Same; Same; Same; Same; Same; The controlling intention is to minimize the risk of fraud and diversion
in the course of subsequent formation and growth of the Union fund.It is immaterial that the Union,
having been organized for less than a year before its application for registration with the BLR, would have
had no real opportunity to levy and collect dues and fees from its members which need to be recorded in
the books of account. Such accounting books can and must be submitted to the BLR, even if they contain
no detailed or extensive entries as yet. The point to be stressed is that the applicant local or chapter must
demonstrate to the BLR that it is entitled to registered status because it has in place a system for
accounting for members contributions to its fund even before it actually receives dues or fees from its
members. The controlling intention is to minimize the risk of fraud and diversion in the course of the
subsequent formation and growth of the Union fund.
Same; Same; Same; Same; The statutory and regulatory provisions defining the requirements of
registration of legitimate labor organizations are an exercise of the overriding police power of the State,
designed for the protection of workers against potential abuse by unions and federations of unions that
recruit them.The public respondent Undersecretary thus acted arbitrarily in disregarding the plain terms
of the Omnibus Implementing Rules (Section 3(e), Rule II, Book V, Omnibus Rules Implementing the
Labor Code), and as well the rule laid down by this Court in the Progressive Development Corporation
case. The statutory and regulatory provisions defining the requirements of registration of legitimate labor
organizations are an exercise of the overriding police power of the State, designed for the protection of
workers against potential abuse by unions and federations of unions that recruit them. This purpose is
obviously defeated if the registration requirements are relaxed arbitrarily by the very officials supposed to
administer such requirements and registered status extended to an organization not entitled to such status,
as in the case at bar.
Same; Same; Same; Same; The certification election was held in the presence of representatives of the
DOLE and presumably reflected the free and democratic will of the workers of petitioner Company.The
Court is not closing its eyes to the certification election actually, if precipitately, held in this case
notwithstanding the prior issuance of the temporary restraining order of this Court. So far as the record of
this case is concerned, that certification election was held in the presence of representatives of the DOLE
and presumably reflected the free and democratic will of the workers of petitioner Company. The Court
will not set aside that will, in the absence of compelling reasons to do so.
Same; Same; Same; Registration is a condition sine qua non for the acquisition of legal personality by a
labor organization.Nevertheless, private respondent Union must comply with all the requirements of
registration as a legitimate labor organization before it may enjoy the fruits of its certification election
victory and before it may exercise the rights of a legitimate labor organization. Registration is a condition
sine qua non for the acquisition of legal personality by a labor organization and the exercise of the rights
and privileges granted by law to legitimate labor organizations.
Same; Same; Same; Private respondent Union must submit its books of account certified under oath by its
treasurer and attested to by its president before such Union may demand recognition by the Company as
the exclusive bargaining agent.We hold, therefore, that private respondent Union must submit its books

of account certified under oath by its treasurer and attested to by its president before such Union may
demand recognition by the Company as exclusive bargaining agent of the members of the bargaining unit
and before the Union may exercise any of the rights pertaining to such an agent. Protection Technology,
Inc. vs. Secretary, Department of Labor and Employment, 242 SCRA 99(1995)
San Miguel Foods, Inc.-Cebu B-Meg Feed Plant vs. Languesma, 263 SCRA 68(1996)
Labor Law; Unions; Words and Phrases; Legitimate Labor Organization, Defined.Article 212(h) of
the Labor Code defines a legitimate labor organization as any labor organization duly registered with the
Department of Labor and Employment, and includes any branch or local thereof. It is important to
determine whether or not a particular labor organization is legitimate since legitimate labor organizations
have exclusive rights under the law which cannot be exercised by non-legitimate unions, one of 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.
Same; Same; Ordinarily, a labor organization attains the status of legitimacy only upon the issuance in its
name of a Certificate of Registration by the Bureau of Labor Relations.The pertinent question,
therefore, must be asked: When does a labor organization acquire legitimacy? Ordinarily, a labor
organization attains the status of legitimacy only upon the issuance in its name of a Certificate of
Registration by the Bureau of Labor Relations pursuant to Articles 234 and 235 of the Labor Code.
Same; Same; When an unregistered union becomes a branch, local or chapter of a federation, some of the
requirements for registration mentioned in Arts. 234 and 235 of the Labor Code are no longer required.
The foregoing procedure is not the only way by which a labor union may become legitimate, however.
When an unregistered union becomes a branch, local or chapter of a federation, some of the
aforementioned requirements for registration are no longer required. Section 3, Rule II, Book V of the
Implementing Rules of the Labor Code governs the procedure for union affiliation.
Same; Same; Certification Elections; The choice of a collective bargaining agent is the sole concern of the
employees; An employer that involves itself in a certification election lends suspicion to the fact that it
wants to create a company union.In any case, this Court notes that it is petitioner, the employer, which
has offered the most tenacious resistance to the holding of a certification election among its monthly-paid
rank-and-file employees. This must not be so, for the choice of a collective bargaining agent is the sole
concern of the employees. The only exception to this rule is where the employer has to file the petition for
certification election pursuant to Article 258 of the Labor Code because it was requested to bargain
collectively, which exception finds no application in the case before us. Its role in a certification election
has aptly been described in Trade Unions of the Philippines and Allied Services (TUPAS) v. Trajano, as
that of a mere by-stander. It has no legal standing in a certification election as it cannot oppose the petition
or appeal the Med-Arbiters orders related thereto. An employer that involves itself in a certification
election lends suspicion to the fact that it wants to create a company union. This Court should be the last
agency to lend support to such an attempt at interference with a purely internal affair of labor.
Same; Same; Same; While employers may rightfully be notified or informed of petitions for certification
election, they should not, however, be considered parties thereto with the concomitant right to oppose it.
While employers may rightfully be notified or informed of petitions of such nature, they should not,
however, be considered parties thereto with the concomitant right to oppose it. Sound policy dictates that
they should maintain a strictly hands-off policy.
Same; Same; Same; The certification election is the most democratic and expeditious method by which
the laborers can freely determine the union that shall act as their representative in their dealings with the
Jose D. Dula II
Atty. Gutierrez
establishment.It bears stressing that no obstacle must be placed to the holding of certification elections,
for it is a statutory policy that should not be circumvented. The certification election is the most
democratic and expeditious method by which the laborers can freely determine the union that shall act as
their representative in their dealings with the establishment where they are working. It is the appropriate
means whereby controversies and disputes on representation may be laid to rest, by the unequivocal vote
of the employees themselves. Indeed, it is the keystone of industrial democracy.
Same; Same; Same; What is required to be certified under oath by the secretary or treasurer and attested to
by the locals president are the constitution and by-laws, a statement on the set of officers, and the books
of accounts of the organization the charter certificate issued by the mother union need not be certified
under oath.Petitioner next asseverates that the Charter Certificate submitted by the private respondent
was defective in that it was not certified under oath and attested to by the organizations secretary and
President. Petitioner is grasping at straws. Under our ruling in the Progressive Development Corporation
case, what is required to be certified under oath by the secretary or treasurer and attested to by the locals
president are the constitution and by-laws, a statement on the set of officers, and the books of accounts
of the organization. The charter certificate issued by the mother union need not be certified under oath by
the secretary or treasurer and attested to by the locals president.
Certiorari; The Supreme Court is definitely not the proper venue to consider a factual issue as it is not a
trier of facts.This is a factual issue which petitioner should have raised before the Med-Arbiter so as to
allow the private respondent ample opportunity to present evidence to the contrary. This Court is
definitely not the proper venue to consider this matter for it is not a trier of facts. It is noteworthy that
petitioner did not challenge the legal personality of the federation in the proceedings before the MedArbiter. Nor was this issue raised in petitioners appeal to the Office of the Secretary of Labor and
Employment. This matter is being raised for the first time in this petition. An issue which was neither
alleged in the pleadings nor raised during the proceedings below cannot be ventilated for the first time
before this Court. It would be offensive to the basic rule of fair play, justice and due process.
Same; Certiorari is a remedy narrow in its scope and inflexible in character it is not a general utility
tool in the legal workshop.Certiorari is a remedy narrow in its scope and inflexible in character. It is not
a general utility tool in the legal workshop. Factual issues are not a proper subject for certiorari, as the
power of the Supreme Court to review labor cases is limited to the issue of jurisdiction and grave abuse of
discretion. It is simply unthinkable for the public respondent Undersecretary of Labor to have committed
grave abuse of discretion in this regard when the issue as to the legal personality of the private respondent
IBM Federation was never interposed in the appeal before said forum.
Labor Law; It bears stressing that labor legislation seeks in the main to protect the interest of the members
of the working class and it should never be used to subvert their will.The certification election sought to
be stopped by petitioner is, as of now, fait accompli. The monthly paid rank-and-file employees of SMFI
have already articulated their choice as to who their collective bargaining agent should be. In the
certification election held on August 20, 1994, the SMFI workers chose IBM at SMFI to be their sole and
exclusive bargaining agent. This democratic decision deserves utmost respect. Again, it bears stressing
that labor legislation seeks in the main to protect the interest of the members of the working class. It
should never be used to subvert their will. [San Miguel Foods, Inc.-Cebu B-Meg Feed Plant vs.
Languesma, 263 SCRA 68(1996)]

Vassar Industries Employees Union (VIEU) vs. Estrella, 82 SCRA 280(1978)
Labor Law; Labor Unions; Constitutional Law; Freedom of association; Employees right to form unions
to protect their interests statutorily and constitutionally recognized.An earlier decision, Federation
Obrera v. Noriel, 72 SCRA 24, sets forth the scope and amplitude of the right to freedom of association.
Clearly, what is at stake is the constitutional right to freedom of association on the part of employees.
Petitioner labor union was in the past apparently able to enlist the allegiance of the working force in the
AngloAmerican Tobacco Corporation. Thereafter, a number of such individuals joined private respondent
labor union. That is a matter clearly left to their sole uncontrolled judgment. There is this excerpt from Pan
American World Airways, Inc. v. Pan American Employees Association: There is both a constitutional
and statutory recognition that laborers have the right to form unions to take care of their interests vis-a-viz
their employees. Their freedom to form organizations would be rendered nugatory if they could not
choose their own leaders to speak on their behalf to bargain for them. It cannot be otherwise, for the
freedom to choose which labor organization to join is an aspect of the constitutional mandate of protection
to labor. x x x The new Labor Code is equally explicit on the matter. Thus: The State shall assure the
rights of workers to self-organization, collective bargaining, security of tenure and just and humane
conditions of work.
Same; Same; Disaffiliation; Constitutional Law; Right of employees to join any labor organization
protected by Constitution; Certification election, its function.It was held in Philippine Labor Alliance
Counsel v. Bureau of Labor Relations, 76 SCRA 162, that: It is indisputable that the present controversy
would not have arisen if there were no mass disaffiliation from petitioning union. Such a phenomenon is
nothing new in the Philippine labor movement. Nor it is open to any legal objection. It is implicit in the
freedom of association explicitly ordained by the Constitution. There is then the incontrovertible right of
any individual to join an organization of his choice. That option belongs to him. A workingman is not to
be denied that liberty. He may be, as a matter of fact, more in need of it if the institution of collective
bargaining as an aspect of industrial democracy is to succeed. No obstacle that may possibly thwart the
desirable objective of militancy in labors struggle for better terms and conditions is then to be placed on
his way. Once the fact of disaffiliation has been demonstrated beyond doubt, as in this case, a certification
Same; Same; Registration; A labor union is entitled to registration when it complies with all registration
requirements; Ministerial duty of the Bureau of Labor Relations to register labor unions.Petitioner
union, Vassar Industries Employees Union, filed certiorari proceedings against the Acting Director of the
Bureau of Labor Relations for his refusal to register the union on the ground that there is already a
registered collective bargaining agreement in the company. The union prayed that its application for
registration be given due course. The comment of the government counsel favored the stand of the labor
union. The Supreme Court held: As this is a certiorari proceeding, equitable in character, this Court is
empowered to grant the relief adequate and suitable under the circumstances so that justice in all its
fullness could be achieved. There is this affirmation in the comment of the then Acting Solicitor General
Vicente V. Mendoza as counsel for respondent Estrella: As long as an applicant union complies with all
of the legal requirements for registration, it becomes the BLRs ministerial duty to so register the union.
It suffices then to order that petitioner Union be registered, there being no legal obstacle to such a step and
the duty of the Bureau of Labor Relations being clear. [Vassar Industries Employees Union (VIEU) vs.
Estrella, 82 SCRA 280(1978)]
Villar vs. Inciong, 121 SCRA 444(1983)
Jose D. Dula II
Atty. Gutierrez
Labor Law; A close-shop agreement is a valid form of union security.It is true that disaffiliation from a
labor union is not open to legal objection. It is implicit in the freedom of association ordained by the
Constitution. But this Court has laid down the ruling that a closed shop is a valid form of union security,
and such provision in a collective bargaining agreement is not a restriction of the right of freedom of
association guaranteed by the Constitution.
Same; The mother union has the right to investigate members of a local union affiliated to it under the
mother unions by-laws and procedures, and if found guilty to expel such members.We reject
petitioners theory that their expulsion was not valid upon the grounds adverted to earlier in this Decision.
That PAFLU had the authority to investigate petitioners on the charges filed by their co-employees in the
local union and after finding them guilty as charged, to expel them from the roll of membership of the
Amigo Employees Union-PAFLU is clear under the constitution of the PAFLU to which the local union
was affiliated. And pursuant to the security clause of the new CBA, reiterating the same clause in the old
CBA, PAFLU was justified in applying said security clause. We find no abuse of discretion on the part of
the OIC of Regional Office No. 4 in upholding the validity of the expulsion and on the part of the
respondent Deputy Minister of Labor in sustaining the same.
Same; Same.The contention of petitioners that the charges against them being intra-union problems,
should have been investigated in accordance with the constitution and by-laws of the Amigo Employees
Union-PAFLU and not of the PAFLU, is not impressed with merit. It is true that under the Implementing
Rules and Regulations of the Labor Code, in case of intra-union disputes, redress must first be sought
within the organization itself in accordance with its constitution and by-laws. However, it has been held
that this requirement is not absolute but yields to exception under varying circumstances.
Same; The local unions by-laws shall not apply in the investigation of charges against its members filed
by its officers, who, under said by-laws will also act as judges. In such a case, the mother unions by-laws
shall apply.The facts of the instant petition stand on all fours with the aforecited case that the principle
therein enunciated applies here as well. In the case at bar, the petitioners were charged by the officers of
the Amigo Employees Union-PAFLU themselves who were also members of the Board of Directors of the
Amigo Employees Union-PAFLU. Thus, were the petitioners to be charged and investigated according to
the local unions constitution, they would have been tried by a trial committee of three (3) elected from
among the members of the Board who are themselves the accusers. (Section 2, Article 11, Constitution of
the Local Union). Petitioners would be in a far worse position had this procedure been followed.
Nonetheless, petitioners admit in their petition that two (2) of the six (6) charges, i.e. disaffiliation and
filing a petition for certification election, are not intra-union matters and, therefore, are cognizable by
PAFLU.
Same; A mere minority of a local unions membership cannot disaffiliate their union from its mother
union.Extant from the records is the fact that petitioners numbering ten (10), were among the ninety-six
(96) who signed the Sama-Samang Kapasiyahan whereas there are two hundred thirty four (234) union
members in the Amigo Employees Union-PAFLU. Hence, petitioners constituted a small minority for
which reason they could not have successfully disaffiliated the local union from PAFLU. Since only 96
wanted disaffiliation, it can be inferred that the majority wanted the union to remain an affiliate of PAFLU
and this is not denied or disputed by petitioners. The action of the majority must, therefore, prevail over
that of the minority members.
Same; A mere minority cannot file a petition for union disaffiliation even within the prescribed 60-day
period before the expiry of an existing CBA.It is true, as contended by petitioners, that under Article
257 of the Labor Code and Section 3, Rule 2, Book 2 of its Implementing Rules, questions of exclusive
bargaining representation are entertainable within the sixty (60) days prior to the expiry date of an existing

CBA, and that they did file a petition for certification election within that period. But the petition was filed
in the name of the Amigo Employees Union which had not disaffiliated from PAFLU, the mother union.
Petitioners being a mere minority of the local union may not bind the majority members of the local
union.
Same; An unregistered union has no legal personality and is not entitled to exercise the rights and
privileges of a labor union.But the independent union organized after the Sama-Samang Kapasiyahan
executed February 7, 1977 could not have been registered earlier, much less March 27, 1967 under
Registration Certificate No. 5290-IP. As such unregistered union, it acquires no legal personality and is not
entitled to the rights and privileges granted by law to legitimate labor organizations upon issuance of the
certificate of registration.
Same; An unregistered union cannot validly present or raise representation issues.Simply put, the
Amigo Employees Union (Independent) which petitioners claim to represent, not being a legitimate labor
organization, may not validly present representation issues. Therefore, the act of petitioners cannot be
considered a legitimate exercise of their right to self-organization. Hence, We affirm and reiterate the
rationale explained in Phil. Association of Free Labor Unions vs. Sec. of Labor case, supra, in order to
protect legitimate labor and at the same time maintain discipline and responsibility within its ranks.
Same; The execution of a new CBA is no bar to prosecution of members for violation of the union security
clause of the old CBA where the same clause has been incorporated in the new CBA.The contention of
petitioners that the new CBA concluded between Amigo Employees Union-PAFLU and the Company on
February 15, 1977 containing the union security clause cannot be invoked as against the petitioners for
offenses committed earlier than its conclusion, deserves scant consideration. We find it to be the fact that
the union security clause provided in the new CBA merely reproduced the union security clause provided
in the old CBA about to expire. And since petitioners were expelled from Amigo Employees UnionPAFLU on March 28, 1982 upon denial of their Motion for Reconsideration of the decision expelling
them, the CBA of February 15, 1977 was already applicable to their case.
Same; Same.Finally, We reject petitioners contention that respondent Minister committed error in law
amounting to grave abuse of discretion when he affirmed the conclusion made by the RO4 OIC, upholding
the legal applicability of the security clause of a CBA over alleged offenses committed earlier than its
conclusion and within the 60-day freedom period of an old CBA. In the first place, as We stated earlier,
the security clause of the new CBA is a reproduction or reiteration of the same clause in the old CBA.
While petitioners were charged for alleged commission of acts of disloyalty inimical to the interests of the
Amigo Employees Union-PAFLU in the Resolution of February 14, 1977 of the Amigo Employees UnionPAFLU and on February 15, 1977 PAFLU and the Company entered into and concluded a new collective
bargaining agreement, petitioners may not escape the effects of the security clause under either the old
CBA or the new CBA by claiming that the old CBA had expired and that the new CBA cannot be given
retroactive enforcement. To do so would be to create a gap during which no agreement would govern,
from the time the old contract expired to the time a new agreement shall have been entered into with the
union.
Same; One who exercises his right to disaffiliate from union membership has to shoulder its
consequences.We, therefore, hold and rule that petitioners, although entitled to disaffiliate from their
union and form a new organization of their own, must, however, suffer the consequences of their
separation from the union under the security clause of the CBA. [Villar vs. Inciong, 121 SCRA 444(1983)]
Pambansang Kapatiran Ng Mga Anak Pawis Sa Formey Plastic National Workers Brotherhood vs.
Secretary of Labor, 253 SCRA 96(1996)
Jose D. Dula II
Atty. Gutierrez
Labor Law; Judgment; Findings of Facts; Findings of facts of quasi-judicial agencies will not be disturbed
unless there is a showing of grave abuse of discretion.The rule is that findings of facts of quasi-judicial
agencies will not be disturbed unless there is a showing of grave abuse of discretion. We find none in the
case at bench. We therefore affirm that there is a validly executed collective bargaining agreement
between FORMEY and KAMAPI.
Labor Relations; Certification Election; Petition for certification election or a motion for intervention can
only be entertained within sixty (60) days prior to the expiry date of such agreement.Art. 253-A of the
Labor Code provides that (n)o petition questioning the majority status of the incumbent bargaining agent
shall be entertained and no certification election shall be conducted by the Department of Labor and
Employment outside of the sixty (60)-day period immediately before the date of expiry of such five-year
term of the collective bargaining agreement. Sec. 3, Rule V, Book V of the Omnibus Rules Implementing
the Labor Code provides that x x x (i)f a collective bargaining agreement has been duly registered in
accordance with Article 231 of the Code, a petition for certification election or a motion for intervention
can only be entertained within sixty (60) days prior to the expiry date of such agreement.
Same; Labor Organization; Labor Union; A local union maintains its separate personality despite
affiliation with a larger national federation.It is further argued that the CBA has no binding force since it
was entered into by KAMAPI as a federation and not by the local union. Perusal of the agreement proves
the contention flawed.
The signatories for KAMAPI consisted of its national president and of the duly elected officers of the
local union. Thus the fact that KAMAPI was particularly mentioned as the bargaining party without
specifying the local union cannot strip it of its authority to participate in the bargaining process. The local
union maintains its separate personality despite affiliation with a larger national federation.
Same; Same; Same; The mother union acting for and in behalf of its affiliates has the status of an agent
while the local union remain the basic unit of the association free to serve the common interest of all its
members subject to the restraints imposed by the Constitution and By-Laws of the association.The
doctrine laid down in Progressive Development Corporation is a mere clarification of the principle
enunciated in Liberty Cotton Mills Workers Union v. Liberty Cotton Mills, Inc. Both cases have provided
that the mother union acting for and in behalf of its affiliate ha(s) 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. Nonetheless,
the facts and principles laid down in both cases do not jibe squarely with the case at bench. The
controversy in Progressive Development Corporation centered 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, while in Liberty Cotton Mills Workers the issue involved was the disaffiliation
of the local union from the federation. The question of whether there was a valid and existing CBA, which
is the question being resolved in the case at bench, was never raised in the two cited cases since it was
already an accepted fact that the CBA was validly executed and existing. [Pambansang Kapatiran Ng Mga
Anak Pawis Sa Formey Plastic National Workers Brotherhood vs. Secretary of Labor, 253 SCRA
96(1996)]
Furusawa Rubber Philippines, Inc. vs. Secretary of Labor and Employment, 282 SCRA 635(1997)]
Labor Law; Labor Unions; Court agrees with respondent Secretary of Labor and Employment that FEUIND is a legitimate labor organization.We cannot sustain petitioner. We agree with respondent Secretary
of Labor and Employment that FEU-IND is a legitimate labor organization. As such, it enjoys all the
rights and privileges recognized by law. The fact that FEU-IND has been issued Certificate of Registration

No. RO-400-9502-UR-003 by Regional Office No. 14 of the Department of Labor and Employment
(DOLE) is sufficient proof of its legitimacy. The presentation of the xerox copy of the certificate of
registration to support its claim of being a duly registered labor organization instead of the submission of
the original certificate is not a fatal defect and does not in any way affect its legitimate status as a labor
organization conferred by its registration with DOLE. The issuance of the certificate of registration
evidently shows that FEU-IND has complied with the requirements of Art. 234 of the Labor Code. The
requirements for registration being mandatory, they are complied with before any labor organization,
association or group of unions or workers acquires legal personality and be entitled to the rights and
privileges granted by law to legitimate labor organizations.
Same; Same; The submission of a xerox copy of the unions certificate of registration to prove its
legitimacy is sufficient, hence, the Med-Arbiter correctly granted the petition for certification election.
The issue on the legitimacy of the petitioning union should be settled in its favor. The submission of a
xerox copy of the unions certificate of registration to prove its legitimacy is sufficient, hence, the MedArbiter correctly granted the petition for certification election. As it been held in a long line of cases, a
certification proceeding is not a litigation in the sense that the term is ordinarily understood, but an
investigation of a fact-finding and non-adversarial character.
It is not covered by the technical rules of evidence. Thus, as provided in Art. 221 of the Labor Code,
proceedings before the National Labor Relations Commission are not covered by the technical rules of
evidence and procedure.
Same; Same; A legitimate labor organization has the right to represent its members in collective
bargaining agreements and to be certified as the exclusive representative of all employees in an
appropriate unit for purposes of collective bargaining.One of the rights of a legitimate labor
organization is to represent its members in collective bargaining agreements; also, to be certified as the
exclusive representative of all employees in an appropriate unit for purposes of collective bargaining.
Hence the petition of FEU-IND, as a legitimate labor organization, for certification election may rightfully
be granted.
Same; Same; Certification Election; Basically, a petition for certification election is principally the
concern of the workers.FEU-IND filed a petition for certification election precisely to determine the
will of the employees for purposes of collective bargaining. Basically, a petition for certification election
is principally the concern of the workers. The only exception is where the employer has to file a petition
for certification election so that it can bargain collectively as mandated by Art. 258 of the Labor Code.
Thereafter, the role of the employer in the certification process ceases. It becomes merely a bystander. In
one case this court ruled that since the petition for certification election was filed by a legitimate labor
organization under Art. 258 of the Labor Code, the employer should not have involved itself in the
process.
Same; Same; Same; Any attempt on the part of management or employers to curtail or stifle this right of
the workers will be deemed unconstitutional and considered as unfair labor practice on the part of
management.To circumvent the law on the fundamental right of the workers to self-organization would
render such constitutional provision meaningless. Section 3, Art. XIII, of the 1987 Constitution
underscores the right of the workers to organize with others or to join any labor organization which he
believes can assist and protect him in the successful pursuit of his daily grind. The choice is his. Any
attempt on the part of management or employers to curtail or stifle this right of the workers will be
deemed unconstitutional and considered as unfair labor practice on the part of management. Briefly, this
right to self-organization is a fundamental rightto give the workers the freedom to form any labor
Jose D. Dula II
Atty. Gutierrez
organization voluntarily without fear of suppression or reprisal from management. PD No. 828 encourages
trade unionism to supplement and strengthen the exercise of the workers right to self-organization.
Same; Same; Same; In an unorganized establishment where there is no certified bargaining agent, a
certification election shall automatically be conducted by the Med-Arbiter upon filing of a petition by a
legitimate labor organization for a certific ation election.Petitioner FURUSAWA further argues that the
Med-Arbiter ignored the fact that FEU-IND does not represent at least 20% of the employees in the
bargaining unit which it seeks to represent. Public respondent however has found the petition to be
sufficient in form and substance, there being compliance with the required 20% support signatures. Article
257 of the Labor Code provides that in an unorganized establishment where there is no certified
bargaining agent, a certification election shall automatically be conducted by the Med-Arbiter upon filing
of a petition by a legitimate labor organization for a certification election. [Furusawa Rubber Philippines,
Inc. vs. Secretary of Labor and Employment, 282 SCRA 635(1997)]
Tropical Hut Employees' Union-CGW vs. Tropical Hut Food Market, Inc., 181 SCRA 173(1990)]
Labor; Appeal; Exhaustion of Administrative Remedies; Remedy of appeal from the Secretary of Labor to
the Office of the President not a mandatory requirement before resort to Courts can be had.The remedy
of appeal from the Secretary of Labor to the Office of the President is not a mandatory requirement before
resort to courts can be had, but an optional relief provided by law to parties seeking expeditious
disposition of their labor disputes. Failure to avail of such relief shall not in any way serve as an
impediment to judicial intervention. And where the issue is lack of power or arbitrary or improvident
exercise thereof, decisions of the Secretary of Labor may be questioned in a certiorari proceeding without
prior appeal to the President (Arrastre Security Association___TUPAS v. Ople, No. L-45344, February 20,
1984, 127 SCRA 580). Since the instant petition raises the same issue of grave abuse of discretion of the
Secretary of Labor amounting to lack of or in excess of jurisdiction in deciding the controversy, this Court
can properly take cognizance of and resolve the issues raised herein.
Same; Evidence; Court aware of the time-honored doctrine that the findings of the NLRC and the
Secretary of Labor are binding on the Court if supported by substantial evidence.We are aware of the
time-honored doctrine that the findings of the NLRC and the Secretary of Labor are binding on this Court
if supported by substantial evidence. However, in the same way that the findings of facts unsupported by
substantial and credible evidence do not bind this Court, neither will We uphold erroneous conclusions of
the NLRC and the Secretary of Labor when We find that the latter committed grave abuse of discretion in
reversing the decision of the labor arbiter (San Miguel Corporation v. NLRC, L-50321, March 13, 1984,
128 SCRA 180). In the instant case, the factual findings of the arbitrator were correct against that of public
respondents.
Same;Constitutional Law; Right to Self-organization; Employees enjoy the right to self-organization and
to form and join labor organizations of their own choosing for the purpose of collective bargaining and to
engage in concerted activities for their mutual aid or protection.All employees enjoy the right to self
organization and to form and join labor organizations of their own choosing for the purpose of collective
bargaining and to engage in concerted activities for their mutual aid or protection. This is a fundamental
right of labor that derives its existence from the Constitution. In interpreting the protection to labor and
social justice provisions of the Constitution and the labor laws or rules or regulations, We have always
adopted the liberal approach which favors the exercise of labor rights.
Same; Same; Same; Right of a local union to disaffiliate from its mother federation well-settled.The
right of a local union to disaffiliate from its mother federation is well-settled. A local union, being a
separate and voluntary association, is free to serve the interest of all its members including the freedom to

disaffiliate when circumstances warrant. This right is consistent with the constitutional guarantee of
freedom of association.
Same; Same; Same; Same; In the absence of enforceable provisions in the federations constitution
preventing disaffiliation of a local union, a local may sever its relationship with its parent.When the
local union withdrew from the old federation to join a new federation, it was merely exercising its primary
right to labor organization for the effective enhancement and protection of common interests. In the
absence of enforceable provisions in the federations constitution preventing disaffiliation of a local union,
a local may sever its relationship with its parent.
Same; Same; Same; Managers and supervisors are prohibited from joining a rank and file union.
Records show that Arturo Dilag had resigned in the past as President of THEU-NATU because of his
promotion to a managerial or supervisory position as Assistant Unit Manager of respondent Company.
Petitioner Jose Encinas replaced Dilag as President and continued to hold such position at the time of the
disaffiliation of the union from the federation. It is therefore improper and contrary to law for Dilag to
reassume the leadership of the remaining group which was alleged to be the true union since he belonged
to the managerial personnel who could not be expected to work for the betterment of the rank and file
employees. Besides, managers and supervisors are prohibited from joining a rank and file union
(Binalbagan Isabela Sugar Co., Inc. (BISCOM) v. Philippine Association of Free Labor Unions (PAFLU),
et al., L-18782, August 29, 1963, 8 SCRA 700). Correspondingly, if a manager or supervisor organizes or
joins a rank and file union, he will be required to resign therefrom.
Same; Same; Due Process; Illegal Dismissal; The discharge of an employee from his employment is null
and void where the employee was not formally investigated and given the opportunity to refute the alleged
findings made by the company.The prerogative of the employer to dismiss or lay-off an employee
should be done without abuse of discretion or arbitrariness, for what is at stake is not only the employees
name or position but also his means of livelihood. Thus, the discharge of an employee from his
employment is null and void where the employee was not formally investigated and given the opportunity
to refute the alleged findings made by the company (De Leon v. NLRC, L-52056, October 30, 1980, 100
SCRA 691). Likewise, an employer can be adjudged guilty of unfair labor practice for having dismissed
its employees in line with a closed shop provision if they were not given a proper hearing. [Tropical Hut
Employees' Union-CGW vs. Tropical Hut Food Market, Inc., 181 SCRA 173(1990)]
Lakas ng Manggagawang Makabayan vs. Marcelo Enterprises, 118 SCRA 422(1982)

Labor Law; There is no evidence that the management of Marcelo group of companies was guilty of ULP
in asking the returning strikers to fill up forms on when they are available for work.Hence, anent the
second issue of whether or not the complaint for unfair labor practice can be sustained, this Court rules in
favor of the respondent Marcelo Companies and consequently, the appealed Decision is reversed. This
reversal is inevitable after this Court has pored through the voluminuous records of the case as well as
after applying the established jurisprudence and the law on the matters raised.We are not unmindful of the
plight of the employees in this case but We consider it oppressive to grant their petition in G.R.No.L38258, for not only is there no evidence which shows that the respondent Marcelo Companies were
seeking for an opportunity to discharge these employees for union activities, or to discriminate against
them because of such activities, but there is affirmative evidence to establish the contrary conclusion.
Same; Managements suggestion that union file necessary complaint in court in view of fact that there are
several unions claiming to represent employees does not constitute failure or refusal to bargain in good
Jose D. Dula II
Atty. Gutierrez
faith to said unions demands.Contrary to the pretensions of complainant LAKAS, the respondent
Marcelo Companies did not ignore the demand for collective bargaining contained in its letter of June 20,
1967. Neither did the companies refuse to bargain at all. What it did was to apprise LAKAS of the existing
conflicting demands for recognition as the bargaining representative in the appropriate units involved, and
suggested the settlement of the issue by means of the filing of a petition for certification election before
the Court of Industrial Relations. This was not only the legally approved procedure but was dictated by the
fact that there was indeed a legitimate representation issue. PSSLU, with whom the existing CB As were
entered into, was demanding of respondent companies to collectively bargain with it; so was Paulino
Lazaro of MUEWA, J.C. Espinas & Associates for MACATIFU and the MFWU, and the complainant
LAKAS for MULU which we understand is the aggrupation of MACATIFU, MFWU and UNWU. On top
of all of these, Jose Roque of UNWU disauthorized the PSSLU from representing his union; and similarly,
Augusto Carreon of MACATIFU itself informed management as late as July 11, 1967 or after the demand
of LAKAS that no group representing his Union is not authorized and should not be entertained.
Same; Where there exists a legitimate issue as to which of several unions is the legitimate representative
of employees, it is ULP for one of the unions to stage a strike and demand that employer sit down with it
for collective bargaining.The clear facts of the case as hereinbefore restated indisputably show that a
legitimate representation issue confronted the respondent Marcelo Companies. In the face of these facts
and in conformity with the existing jurisprudence, We hold that there existed no duty to bargain
collectively with the complainant LAKAS on the part of said companies. And proceeding from this basis,
it follows that all acts instigated by complainant LAKAS such as the filing of the Notice of Strike on June
13, 1967 (although later withdrawn) and the two strikes of September 4, 1967 and November 7, 1967 were
calculated, designed and intended to compel the respondent Marcelo Companies to recognize or bargain
with it notwithstanding that it was an uncertified union, or in the case of respondent Marcelo Tire and
Rubber Corporation, to bargain with it despite the fact that the MUEWA of Paulino Lazaro was already
certified as the sole bargaining agent in said respondent company. These concerted activities executed and
carried into effect at the instigation and motivation of LAKAS are all illegal and violative of the
employers basic right to bargain collectively only with the representative supported by the majority of its
employees in each of the bargaining units. This Court is not unaware of the present predicament of the
employees involved but much as We sympathize with those who have been misled and so lost then-jobs
through hasty, ill-advised and precipitate moves, We rule that the facts neither substantiate nor support the
finding that the respondent Marcelo Companies are guilty of unfair labor practice.
Same; Employer not guilty of bad faith where it not with unions officers and offered suggestions on how
to resolve their dif-ferences.It is also evident from the records that the charge of bargaining in bad faith
imputed to the respondent companies, is hardly credible. In fact, such charge is valid as only against the
complainant LAKAS. The parties had a total of five (5) conferences for purposes of collective bargaining.
It is worth considering that the first strike of September 4, 1967 was staged less than a week after the
fourth CBA conference and without any benefit of any previous strike notice. In this connection, it must
be stated that the notice of strike filed on June 13, 1967 could not have been the strike notice for the first
strike because it was already withdrawn on July 14, 1967. Thus, from these stated facts can be seen that
the first strike was held while the parties were in the process of negotiating. Nor can it be sustained that
the respondent Marcelo Companies bargained in bad faith since there were proposals offered by them, but
the complainant LAKAS stood pat on its position that all of their economic demands should be met and
that all of these demands should be granted in all of the respondent Marcelo Companies. The companies
refusal to accede to the demands of LAKAS appears to be justified since there is no showing that these
companies were in the same state of financial and economic affairs. There is reason to believe that the first
strike was staged only for the purpose of compelling the respondent Marcelo Companies to accede to the
inflexible demands of the complainant LAKAS. The records further establish that after the resumption of
normal operations following the first strike and the consequent Return-to-work Agreement, the striking

unions led by complainant LAKAS and the management of the respondent Marcelo Companies resumed
their bargaining negotiations. And that on October 13, 1967, complainant LAKAS sent the final drafts of
the collective bargaining proposals for MFWU and UNWU. The second strike of November 7, 1967 was
then staged immediately after which strike, as before, was again lacking of a strike notice. All of these
facts show that it was complainant LAKAS, and not the respondent Marcelo Companies, which refused to
negotiate in the pending collective bargaining process. All that the facts show is that the bargaining
position of complainant LAKAS was inflexible and that it was in tine with this uncompromising attitude
that the strikes were declared, significantly after notice that management did not or could not meet all of
their 17-points demand.
Same; Employer may be justified in requiring a reasonable scheduling of working hours of returning
striking employees and inquiring into their time availabilities.But We are more impressed and are
persuaded to accept as true the contention of the respondent Marcelo Companies that the aforestated
requirement was only for purposes of proper scheduling of the start of work for each returning strikers. It
must be noted that as a consequence of the two strikes which were both attended by widespread acts of
violence and vandalism, the businesses of the respondent companies were completely paralyzed. It would
hardly be justiciable to demand of the respondent companies to readmit all the returning workers in one
big force or as each demanded readmission. There were machines that were not in operating condition
because of long disuse during the strikes. Some of the machines needed more than one worker to operate
them so that in the absence of the needed team of workers, the start of work by one without his teammates
would necessarily be useless, and the company would be paying for his time spent doing no work. Finally,
We take judicial cognizance of the fact that companies whose businesses were completely paralyzed by
major strikes cannot resume operations at once and in the same state or force as before the strikes.
Same; Same.But what strikes Us most in lending credence to respondents allegation that Exhibit 49
was not meant to screen the strikers, is the fact that all of the returning strikers who filled up the form
were scheduled for work and consequently started with their jobs.It is only those strikers who refused or
failed to fill-up the required form, like the herein complaining employees, who were not scheduled for
work and consequently have not been re-employed by the respondent Marcelo Companies. Even if there
was a sincere belief on their part that the requirement of Exhibit 49 was a ruse at screening them, this
fear would have been dispelled upon notice of the fact that each and all of their co-strikers who filled up
the required form were in fact scheduled for work and started to work. The stoppage of their work was
not, therefore, the direct consequence of the respondent companies complained act. Hence, their
economic loss should not be shifted to the employer.
Same; Right to engage in concerted activities is not an absolute one.It was never the state policy nor
Our judicial pronouncement that the employees rights to self-organization and to engage in concerted
activities for mutual aid and protection, are absolute or be upheld under all circumstances.
Same; Action; A labor union cannot bring an action on behalf of employees who are members of another
union even if said employees signed the complaint.Firstly, LAKAS cannot bring any action for and in
behalf of the employees who were members of MUEWA because, as intimated earlier in this Decision, the
said local union was never an affiliate of LAKAS. What appears clearly from the records is that it was
Augusto Carreon and his followers who joined LAKAS, but then Augusto Carreon was not the recognized
president of MUEWA and neither he nor his followers can claim any legitimate representation of
MUEWA. Apparently, it is this split faction of MUEWA, headed by Augusto Carreon, who is being sought
to be represented by LAKAS. However, it cannot do so because the members constituting this split faction
of MUEWA were still members of MUEWA which was on its own right a duly registered labor union.
Hence, any suit to be brought for and in behalf of them can be made only by MUEWA, and not LAKAS. It
appearing then that Augusto Carreon and his cohorts did not disaffiliate from MUEWA nor signed any
Jose D. Dula II
Atty. Gutierrez
individual affiliation with LAKAS, LAKAS bears no legal interest in representing MUEWA or any of its
members.
Same; Same.Nor will the lower courts opinion be availing with respect to the complaining employees
belonging to UNWU and MFWU. Although it is true, as alleged by LAKAS, that when it filed the charge
on December 26, 1967, the officers of the movant unions were not yet then the officers thereof,
nevertheless, the moment MFWU and UNWU separated from and disaffiliated with LAKAS to again
exercise its rights as independent local unions, registered before as such, they are no longer affiliates of
LAKAS, as what transpired here. Naturally, there would no longer be any reason or occasion for LAKAS
to continue representing them. Notable is the fact that the members purportedly represented by LAKAS
constitute the mere minority of the movant unions, as may be inferred from the allegations of the movant
unions as well as the counter-allegations of LAKAS filed below. As such, they cannot prevail or dictate
upon the will of the greater majority of the unions to which they still belong, it appearing that they never
disaffiliated from their unions; or stated in another way, they are bound by the action of the greater
majority.
Same; Same; Where a union brought suit in behalf of employees it was not authorized to represent, the
proper remedy is to drop the union as party to the action and place the names of the employees instead.
This is not to say that the complaining employees were without any venue for redress. Under the
aforestated considerations, the respondent court should have directed the amendment of the complaint by
dropping LAKAS as the complainant and allowing the suit to be further prosecuted in the individual
names of those who had grievances. A class suit under Rule 3, Section 12 of the Rules of Court is
authorized and should suffice for the purpose.
Same; Same; Appeals; Supreme Court may cure defect of inclusion/non-inclusion of proper parties even
on appealIn fairness to the complaining employees, however, We treated their Motion for
Reconsideration of the Decision subject of appeal as curing the defect of the complaint as the said motion
expressly manifested their collective desire to pursue the complaint for and in their own behalves and
disauthorizing LAKAS counsel from further representing them. And We have also treated their petition
before Us in the same manner, disregarding the fact that LAKAS remained the petitioning party, as it
appears from the verification that the petition in L-38258 was for and in behalf of the complaining
employees. The merits of their petition, however, fall short of substantiating the charge of unfair labor
practice against the respondent Marcelo Companies. On the other hand, the appeal of the Marcelo
Companies in L-38260 must be upheld and sustained. [Lakas ng Manggagawang Makabayan vs. Marcelo
Enterprises, 118 SCRA 422(1982)]
Alliance of Democratic Free Labor Organization vs. Laguesma, 254 SCRA 565(1996)]
Labor Law; Administrative Proceedings; Due Process; Administrative agencies exercising quasi-judicial
powers, like the DOLE, are free from the rigidity of certain procedural requirements, nonetheless, they are
bound by law and practice to observe the essential requisites of due process.While, in general,
administrative agencies exercising quasi-judicial powers, like the Department of Labor and Employment,
are free from the rigidity of certain procedural requirements, they are nonetheless bound by law and
practice to observe the fundamental and essential requirements of due process in justiciable cases
presented before them.
Same; Same; Same; The most basic tenet of due process is the right to be heard, as applied in
administrative proceedings, an opportunity to explain ones side.The most basic tenet of due process
is the right to be heard, and as applied in administrative proceedings, an opportunity to explain ones side.
Such opportunity was denied petitioner in this case.
Jose D. Dula II
Atty. Gutierrez
Same; Same; Same.Under Section 1, Article II of our Constitution, (n)o person shall be deprived of
life, liberty or property without due process of law x x x and under Article 238 of the Labor Code, (t)he
certificate of registration of any legitimate labor organization, whether national or local, shall be cancelled
by the Bureau if it has reason to believe, after due hearing, that the said labor organization no longer meets
one or more of the requirements herein prescribed. (emphasis supplied)
and academic. The prayer is for the dismissal of the petition on the ground that it is moot and academic.
WHEREFORE, this petition for certiorari is dismissed for being moot and academic. [Tablante-Tungol
Enterprises vs. Noriel, 84 SCRA 738(1978)]
Labor Relations; Labor Organization; Unions; Cancellation of a certificate of registration is the equivalent
of snuffing out the life of a labor organization, without such, it loses its rights under the Labor Code.
The cancellation of a certificate of registration is the equivalent of snuffing out the life of a labor
organization. For without such
UST Faculty Union vs. Bitonio, Jr., 318 SCRA 185(1999)]
registration, it losesas a ruleits rights under the Labor Code. Under the circumstances, petitioner was
indisputably entitled to be heard before a judgment could be rendered cancelling its certificate of
registration. In David vs. Aguilizan, it was held that a decision rendered without any hearing is null and
void. [Alliance of Democratic Free Labor Organization vs. Laguesma, 254 SCRA 565(1996)]
National Union of Bank Employees vs. Minister of Labor, 110 SCRA 274(1981)]
Labor Law; A certification election may be ordered despite pendency of a petition to cancel the unions
registration certificate.The Court rules in the affirmative. The pendency of the petition for cancellation
of the registration certificate of herein petitioner union is not a bar to the holding of a certification
election. The pendency of the petition for cancellation of the registration certificate of petitioner union
founded on the alleged illegal strikes staged by the leaders and members of the intervenor union and
petitioner union should not suspend the holding of a certification election, because there is no order
directing such cancellation (cf. Dairy Queen Products Company of the Philippines, Inc. vs. Court of
Industrial Relations, et al., No. L-35009, Aug. 31, 1977). In said Dairy Queen case, one of the issues
raised was whether the lower court erred and concomitantly committed grave abuse of discretion in
disregarding the fact that therein respondent unions permit and license have been cancelled by the then
Department of Labor and therefore could not be certified as the sole and exclusive bargaining
representative of the rank and file employees of therein petitioner company.
Same; Petition to cancel union registration evidently intended to delay holding of a certification election.
It may be worthy to note also that the petition for cancellation of petitioner unions registration
certificate based on the alleged illegal strikes staged on October 12, 1979 and later November 57, 1979
was evidently intended to delay the early disposition of the case for certification election considering that
the same was apparently filed only after the October 18, 1979 Order of Med-Arbiter Plagata which
directed the holding of a certification election.
Same; Cancellation of union registration certificate is not the only penalty for violation of the Labor Code.
From the aforequoted provisions, We are likewise convinced that as it can be gleaned from said
provisions, cancellation of the registration certificate is not the only resultant penalty in case of any
violation of the Labor Code. Certainly, the penalty imposable should be commensurate to the nature or
gravity of the illegal activities conducted and to the number of members and leaders of the union staging
the illegal strike. [National Union of Bank Employees vs. Minister of Labor, 110 SCRA 274(1981)]
Tablante-Tungol Enterprises vs. Noriel, 84 SCRA 738(1978)]
Moot and Academic; Where both parties are no longer interested in the outcome of a case, a prayer for its
dismissal on the ground that it is moot and academic may be granted.That both parties are no longer
interested in the outcome/result of this case and pray of this Honorable Court to dismiss it for being moot
Labor Law; Actions; Certiorari; Pleadings and Practice; Hierarchy of Courts; Challenges against rulings of
the labor secretary and those acting on his behalf, like the director of labor relations, shall be acted upon
by the Court of Appeals, which has concurrent jurisdiction with the Supreme Court over petitions for
certiorari.At the outset, the Court stresses that National Federation of Labor (NFL) v. Laguesma has
held that challenges against rulings of the labor secretary and those acting on his behalf, like the director
of labor relations, shall be acted upon by the Court of Appeals, which has concurrent jurisdiction with this
Court over petitions for certiorari. However, inasmuch as the memoranda in the instant case have been
filed prior to the promulgation and finality of our Decision in NFL, we deem it proper to resolve the
present controversy directly, instead of remanding it to the Court of Appeals. Having disposed of the
foregoing procedural matter, we now tackle the issues in the present case seriatim.
Same; Right to Self-Organization; Unions; Employees have the right to form, join or assist labor
organizations for the purpose of collective bargaining or for their mutual aid and protection.Selforganization is a fundamental right guaranteed by the Philippine Constitution and the Labor Code.
Employees have the right to form, join or assist labor organizations for the purpose of collective
bargaining or for their mutual aid and protection. Whether employed for a definite period or not, any
employee shall be considered as such, beginning on his first day of service, for purposes of membership in
a labor union.
Same; Same; Same; To become a union member, an employee must, as a rule, not only signify the intent
to become one, but also to take some positive steps to realize that intent.Corollary to this right is the
prerogative not to join, affiliate with or assist a labor union. Therefore, to become a union member, an
employee must, as a rule, not only signify the intent to become one, but also take some positive steps to
realize that intent. The procedure for union membership is usually embodied in the unions constitution
and bylaws. An employee who becomes a union member acquires the rights and the concomitant
obligations that go with this new status and becomes bound by the unions rules and regulations.
Same; Same; Same; Members frustration over the performance of the union officers, as well as their fears
of a fraudulent election to be held under the latters supervision, could not justify the disregard of the
unions constitution and by-laws.Petitioners claim that the numerous anomalies allegedly committed by
the private respondents during the latters incumbency impelled the October 4, 1996 election of the new
set of USTFU officers. They assert that such exercise was pursuant to their right to self-organization.
Petitioners frustration over the performance of private respondents, as well as their fears of a fraudulent
election to be held under the latters supervision, could not justify the method they chose to impose their
will on the union. Director Bitonio aptly elucidated: The constitutional right to self-organization is better
understood in the context of ILO Convention No. 87 (Freedom of Association and Protection of Right to
Organize), to which the Philippines is signatory. Article 3 of the Convention provides that workers
organizations shall have the right to draw up their constitution and rules and to elect their representatives
in full freedom, free from any interference from public authorities. The freedom conferred by the
provision is expansive; the responsibility imposed on union members to respect the constitution and rules
they themselves draw up equally so. The point to be stressed is that the unions CBL is the fundamental
law that governs the relationship between and among the members of the union. It is where the rights,

duties and obligations, powers, functions and authority of the officers as well as the members are defined.
It is the organic law that determines the validity of acts done by any officer or member of the union.
Without respect for the CBL, a union as a democratic institution degenerates into nothing more than a
group of individuals governed by mob rule.
Same; Same; Same; Words and Phrases; Union Election and Certification Election, Distinguished; An
employee belonging to the appropriate bargaining unit but who is not a member of the union cannot vote
in the union election, unless otherwise authorized by the constitution and by-laws of the unionunion
affairs and elections cannot be decided in a non-union activity.A union election is held pursuant to the
unions constitution and by-laws, and the right to vote in it is enjoyed only by union members. A union
election should be distinguished from a certification election, which is the process of determining, through
secret ballot, the sole and exclusive bargaining agent of the employees in the appropriate bargaining unit,
for purposes of collective bargaining. Specifically, the purpose of a certification election is to ascertain
whether or not a majority of the employees wish to be represented by a labor organization and, in the
affirmative case, by which particular labor organization. In a certification election, all employees
belonging to the appropriate bargaining unit can vote. Therefore, a union member who likewise belongs to
the appropriate bargaining unit is entitled to vote in said election. However, the reverse is not always true;
an employee belonging to the appropriate bargaining unit but who is not a member of the union cannot
vote in the union election, unless otherwise authorized by the constitution and by-laws of the union.
Verily, union affairs and elections cannot be decided in a non-union activity.
Same; Same; Same; A unions constitution and by-laws embody a covenant between a union and its
members and constitute the fundamental law governing the members rights and obligations.The
importance of a unions constitution and by-laws cannot be overemphasized. They embody a covenant
between a union and its members and constitute the fundamental law governing the members rights and
obligations. As such, the unions constitution and by-laws should be upheld, as long as they are not
contrary to law, good morals or public policy.
Same; Same; Same; Collective Bargaining Agreements; Ratification of a new Collective Bargaining
Agreement executed between the new officers of the union and management does not have the effect of
validating a void union electionthe ratification refers only to the terms of the new Collective Bargaining
Agreement, not the issue of union leadership.The ratification of the new CBA executed between the
petitioners and the University of Santo Tomas management did not validate the void October 4, 1996
election. Ratified were the terms of the new CBA, not the issue of union leadershipa matter that should
be decided only by union members in the proper forum at the proper time and after observance of proper
procedures. [UST Faculty Union vs. Bitonio, Jr., 318 SCRA 185(1999)]
Salanga vs. Court of Industrial Relations, 21 SCRA 216(1967)]
Labor law; Voluntary associations; State may not compel them to admit any individual as member;
Exception.Although, generally, a state may not compel ordinary voluntary associations to admit thereto
any given individual, because membership therein may be accorded or withheld as a matter of privilege,
the rule is qualified in respect of labor unions holding a monopoly in the supply of labor, either in a given
locality or as regards a particular employer with which it has a closed-shop agreement.
Same; Reason for the ride.The reason is that the closed shop and the union shop cause the admission
requirements of trade unions to become affected with public interest. Likewise, closed-shop, union shop,
or maintenance-of-membership clauses cause the administration of discipline by unions to be affected
with public interest.
Jose D. Dula II
Atty. Gutierrez
Same; Union may not arbitrarily exclude qualified applicants for membership.It is well settled that
labor unions are not entitled to arbitrarily exclude qualified applicants for membership, and a closed-shop
provision would not justify the employer in discharging, or a union in insisting upon the discharge of, an
employee whom the union thus refuses to admit to membership, without any reasonable ground therefor.
Needless to say, if said unions may be compelled to admit new members who have the requisite
qualifications, with more reason may the law and the courts exercise the coercive power when the
employee involved is a long standing union member who, owing to provocations of union officers, was
impelled to tender his resignation, which he forthwith withdrew or revoked. Surely, he may at least invoke
the right of those who seek admission for the first time, and cannot arbitrarily be denied readmission.
Same; Unfair labor practice; When company was not guilty of unfair labor practice.In the case at bar,
the company was reluctantif not unwillingto discharge petitioner. When the union first informed it of
petitioners resignation and urged implementation of Section 3 of the bargaining contract, the company
advised petitioner of its provisions, thereby intimating that he had to withdraw his resignation in order to
keep his employment. Besides, the company notified the union that it would not take any action on the
case and would consider petitioner still a member of the union. When the latter, thereafter, insisted on
petitioners discharge, the company still demurred and explained that it was not taking sides and that its
stand was prompted merely by humane considerations, springing from the belief that petitioner had
resigned from the union without realizing its effect upon his employment. And, as the union reiterated its
demand, the company notified petitioner that it had no other alternative but to terminate his employment,
and dismissed him from the service, although with regret. Under the circumstances, the company was
not unfair to petitioner.
Same; Same; Right of employee dismissed from service due to unfair labor practice.Having been
dismissed from the service owing to an unfair labor practice on the part of the union, petitioner is entitled
to reinstatement as member of the union and to his former or substantially equivalent position in the
company, without prejudice to his seniority and/or rights and privileges, and with back pay, which back
pay shall be borne exclusively by the union. In the exercise of its sound judgment and discretion, the
lower court may, however, take such measures as it may deem best, including the power to authorize the
company to make deductions for petitioners benefit, from the sums due to the union by way of check off
or otherwise. [Salanga vs. Court of Industrial Relations, 21 SCRA 216(1967)
Bugay vs. Kapisanan ng mga Manggagawa sa Manila Railroad Company, 4 SCRA 487(1962)
Court of Industrial Relations; Jurisdiction; Moral damages.Claim form oral damages cannot be included
in a charge for unfair labor practice filed with the Industrial Court as the same does not come within the
jurisdiction of said court. This is a matter that has to be looked into by the regular courts. Bugay vs.
Kapisanan ng mga Manggagawa sa Manila Railroad Company, 4 SCRA 487(1962)
Tancinco vs. Ferrer-Calleja, 157 SCRA 203(1988)
Labor Law; Election; Submission of the employees names with the BLR as qualified members of the
union is not a condition sine qua non to enable said members to vote in the election of unions officers;
Question of eligibility to vote may be determined through the use of the applicable payroll period and
employees status.The finding does not have a leg to stand on. Submission of the employees names
with the BLR as qualified members of the union is not a condition sine qua non to enable said members to
vote in the election of unions officers. It finds no support in fact and in law. For public respondents
findings, the April 24, 1986 list consists of 180 union members only wherein 51 of the 56 challenged

voters names do not appear. Adopting however a rough estimate of a total number of union members who
cast their votes of some 333 and excluding therefrom the 56 challenged votes, if the list is to be the basis
as to who the union members are then public respondent should have also disqualified some 175 of the
333 voters. It is true that under Article 242(c) of the Labor Code, as amended, only members of the union
can participate in the election of union officers. The question however of eligibility to vote may be
determined through the use of the applicable payroll period and employees status during the applicable
payroll period. The payroll of the month next preceding the labor dispute in case of regular employees and
the payroll period at or near the peak of operations in case of employees in seasonal industries. [Tancinco
vs. Ferrer-Calleja, 157 SCRA 203(1988)]
Manalad vs. Trajano, 174 SCRA 322(1989)]

Dismissal of Actions; Where events and circumstances have taken place during the pendency of a case
which would render the case moot and academic, the petition should be dismissed.After a careful
consideration of the facts of this case, We are of the considered view that the expiration of the terms of
office of the union officers and the election of officers on November 28, 1988 have rendered the issues
raised by petitioners in this case moot and academic. It is pointless and unrealistic to insist on annulling an
election of officers whose terms had already expired. We would have thereby a judgment on a matter
which cannot have any practical legal effect upon a controversy, even if existing, and which, in the nature
of things, cannot be enforced. We must consequently abide by our consistent ruling that where certain
events or circumstances have taken place during the pendency of the case which would render the case
moot and academic, the petition should be dismissed.
Labor Law; Unions; Elections; Disqualification of winning candidates will not automatically result in the
assumption of office of those who garnered the second highest number of votes.At this juncture, it
would further be appropriate to remind petitioners that even if the disqualification of private respondents
could be justified, the candidates of petitioners certainly cannot be declared as the winners in the disputed
election. The mere fact that they obtained the second highest number of votes does not mean that they will
thereby be considered as the elected officers if the true winners are disqualified. [Manalad vs. Trajano, 174
SCRA 322(1989)]
Kapisanan ng Manggagawang Pinagyakap (KMP) vs. Trajano, 134 SCRA 236(1985)
Labor Law; Remedy against erring union officers is not referendum but union expulsion.If herein union
officers (also petitioners) were guilty of the alleged acts imputed against them, said public respondent
pursuant to Article 242 of the New Labor Code and in the light of Our ruling in Duyag vs. Inciong, 98
SCRA 522, should have meted out the appropriate penalty on them, i.e., to expel them from the Union, as
prayed for, and not call for a referendum to decide the issue.
Same; Alleged falsification and misrepresentation by herein union officers not supported by substantial
evidence even if expenditures not supported by receipts.The alleged falsification and misrepresentation
of herein union officers were not supported by substantial evidence. The fact that they disbursed the
amount of P1,278.00 from Union funds and later on was disallowed for failure to attach supporting papers
thereon did not of itself constitute falsification and/or misrepresentation. The expenditures appeared to
Jose D. Dula II
Atty. Gutierrez
have been made in good faith and the amount spent for the purpose mentioned in the report, if concurred
in or accepted by the members, are reasonable.
Same; Election Law; Re-election of petitioners and non-election of respondents convincing show of faith
on petitioners leadership.The repudiation of both private respondents to the highly sensitive position of
auditor at the October 4, 1982 election, is a convincing manifestation and demonstration of the union
memberships faith in the herein officers leadership on one hand and a clear condonation of an act they
had allegedly committed.
Same; Same; Public Officers; Removal of officer for acts done prior to present term not proper.By and
large, the holding of the referendum in question has become moot and academic. This is in line with Our
ruling in Pascual vs. Provincial Board of Nueva Ecija, 106 Phil. 471, which We quote: The Court should
never remove a public officer for acts done prior to his present term of office. To do otherwise would be to
deprive the people of their right to elect their officers. When the people have elected a man to office, it
must be assumed that they did this with knowledge of his life and character, and that they disregarded or
forgave his faults or misconduct, if he had been guilty of any. It is not for the court, by reason of such
faults or misconduct to practically overrule the will of the people. [Kapisanan ng Manggagawang
Pinagyakap (KMP) vs. Trajano, 134 SCRA 236(1985)]
Rodriguez vs. Director, Bureau of Labor Relations, 165 SCRA 239(1988)
Labor; Unions; General elections for union officers; Elections for union officers which were attended by
grave irregularities, held invalid.A review of the record fails to disclose any grave abuse of discretion
tainting the adjudgment of respondent Director of Labor Relations that the general elections for union
officers held in 1986 were attended by grave irregularities, rendering the elections invalid. That finding
must thus be sustained. The dates for provincial elections were set for July 14 to 18, 1986. But they were
in fact held on July 21 and 22, 1986, without prior notice to all voting members, and without ground rules
duly prescribed therefor. The elections in Metro Manila were conducted under no better circumstances. It
was held on July 25, 1986 in disregard and in defiance of the temporary restraining order properly issued
by the Med-Arbiter on July 23, 1986, notice of which restraining order had been regularly served on the
same date, as the proofs adequately show, on both the Union President, Manolito Paran, and the Chairman
of the Union COMELEC, Benedicto Rodriguez. Moreover, as in the case of the provincial elections, there
were no ground rules or guidelines set for the Metro Manila elections. Undue haste, lack of adequate
safeguards to ensure integrity of the voting, and absence of notice of the dates of balloting, thus attended
the elections in the provinces and in Metro Manila. They cannot but render the proceedings void.
Same; Same; Same; Free and honest elections are indispensable to the enjoyment by employees and
workers of their right to self-organization; The right would be diluted if the election is not fairly and
honestly conducted.It goes without saying that free and honest elections are indispensable to the
enjoyment by employees and workers of their constitutionally protected right to self-organization. That
right would be diluted if in the choice of the officials to govern x x (union) affairs, the election is not
fairly and honestly conducted, and the labor officers concerned and the courts have the duty to see to it
that no abuse is committed by any official of a labor organization in the conduct of its affairs.
Same; Same; Same; The assent of 30% of the union membership is not a factor in the acquisition of
jurisdiction by the Bureau of Labor Relations over all inter-union and intra-union conflicts, and all
disputes, grievances or problems arising from labor-management relations; Use of the permissive word
may in Article 242 of the Labor Code.The respondent Directors ruling, however, that the assent of
30% of the union membership, mentioned in Article 242 of the Labor Code, was mandatory and essential
to the filing of a complaint for any violation of rights and conditions of membership in a labor
Jose D. Dula II
Atty. Gutierrez
organization (such as the arbitrary and oppressive increase of union dues here complained of), cannot be
affirmed and will be reversed. The very article relied upon militates against the proposition. It states that a
report of a violation of rights and conditions of membership in a labor organization may be made by (a)t
least thirty percent (30%) of all the members of a union or any member or members specially
concerned. The use of the permissive may in the provision at once negates the notion that the assent of
30% of all the members is mandatory. More decisive is the fact that the provision expressly declares that
the report may be made, alternatively by any member or members specially concerned. And further
confirmation that the assent of 30% of the union members is not a factor in the acquisition of jurisdiction
by the Bureau of Labor Relations is furnished by Article 226 of the same Labor Code, which grants
original and exclusive jurisdiction to the Bureau, and the Labor Relations Division in the Regional Offices
of the Department of Labor, over all inter-union and intra-union conflicts, and all disputes, grievances or
problems arising from or affecting labor management relations, making no reference whatsoever to any
such 30%-support requirement. Indeed, the officials mentioned are given the power to act on all interunion and intra-union conflicts (1) upon request of either or both parties as well as (2) at their own
initiative.
acquainting the parties with the various issues involved and the reasons therefor (Ang Tibay vs. Court, 69
Phil. 635, cited on p. 84, Philippine Constitution Law, Fernando, 1984 ed.).
Same; Same; Same; Petition to nullify the union elections clearly involved an intra-union conflict over
which jurisdiction could be assumed by the Labor Relations Director or the Med-Arbiters.These
considerations apply equally well to controversies over elections. In the cases at bar, the petition to nullify
the 1986 union elections could not be deemed defective because it did not have the assent of 30% of the
union membersip. The petition clearly involved an intra-union conflictone directly affecting the right of
suffrage of more than 800 union members and the integrity of the union electionsover which, as the law
explicitly provides, jurisdiction could be assumed by the Labor Relations Director or the Med-Arbiters at
their own initiative or upon request of either or both parties.
Same; Same; A 30% to 45% attorneys lien on award to union members is exorbitant.The 45%
attorneys lien on the award of those union members who were no longer working and the 30% lien on the
benefits of those who were still working as provided for in the alleged retainers contract are very
exorbitant and unconscionable in view of Section 11, Rule VIII of Book III which explicitly provides:
Sec. 11. Attorneys fees.Attorneys fees on any judicial or administrative proceedings for the recovery
of wages shall not exceed 10% of the amount awarded. The fees may be deducted from the total amount
due the winning party.
Same; Same; Same; Union Dues; The resolution of the unions Legislative Council increasing the union
dues is illegal and void because it does not bear the signature of at least two-thirds of the members of the
Council as required by the unions constitution and by-laws, and the absence of proper ratification of the
resolution by a majority of the general union membership at a plebiscite.As regards the final issue
concerning the increase of union dues, the respondent Director found that the resolution of the unions
Legislative Council to this effect does not bear the signature of at least two-thirds (2/3) of the members of
the Council, contrary to the requirement of the union constitution and bylaws; and that proof is wanting of
proper ratification of the resolution by a majority of the general union membership at a plebiscite called
and conducted for that purpose again in violation of the constitution and by laws. The resolution
increasing the union dues must therefore be struck down, as illegal and void, arbitrary and oppressive. The
collection of union dues at the increased rates must be discontinued; and the dues thus far improperly
collected must be refunded to the union members or held in trust for disposition by them in accordance
with their charter and rules, in line with this Courts ruling in a parallel situation. [Rodriguez vs. Director,
Bureau of Labor Relations, 165 SCRA 239(1988)]
Halili vs. Court of Industrial Relations, 136 SCRA 112(1985)
Administrative Law; Labor Law, Requisites for validity of administrative proceedings.This Court, as
earlier stated, nullified said orders dated September 23, 1982 and February 9, 1983 of Labor Arbiter
Valenzuela as violative of the due process clause. It is a settled rule that in administrative proceedings, or
cases coming before administrative tribunals exercising quasi-judicial powers, due process requires not
only notice and hearing, but also the consideration by the administrative tribunal of the evidence
presented; the existence of evidence to support the decision; its substantiality; a decision based thereon or
at least contained in the record and disclosed to the parties; such decision by the administrative tribunal
resting on its own independent consideration of the law and facts of the controversy; and such decision
Attorneys; Labor Law; Act of counsel of filing a motion in the Supreme Court for authority to sell
property in question which he acknowledged that he has no authority, a violation.Significantly, Atty.
Pinedas act of filing a motion with this Court on December 1, 1982 praying for authority to sell was by
itself an admission on his part that he did not possess the authority to sell the property and that this Court
was the proper body which had the power to grant such authority.
Same; Same; Counsel knew the Labor Arbiter has no authority to authorize sale of property at bar Only
the final orders or decisions of a Labor Arbiter or NLRC may be implemented.He could not and did not
even wait for such valid authority but instead previously obtained the same from the labor arbiter whom
he knew was not empowered to so authorize. Under Article 224 (a) of the Labor Code, only final decisions
or awards of the NLRC, the Labor Arbiter, or compulsory or voluntary arbitrators may be implemented or
may be the subject of implementing orders by aforenamed body or officers.
Same; Same; Donation of a portion of attorneys fees to the Union is improper.The amount of
P101,856,00 which Atty. Pineda donated to the Union and which actually corresponds to 5% of the total
35% attorneys fees taken from the proceeds (p. 263, L-24864, rec.) appears improper since it amounts to
a rebate or commission. This amount was subsequently treated as union miscellaneous operating expenses
without the consent of the general membership.
Same; Same; The pleadings show a deceitful pattern on the part of Atty. Pineda who alternatively signed
on behalf of J.C. Espinas and Associates or B.C. Pineda as lone counsel.A deeper scrutiny of the
pleadings in L-24864 notably indicates a fraudulent or deceitful pattern in the actuations of Atty. Pineda.
Thus, in his motion for execution of judgment filed on September 18, 1965 in this, he signed for and in
behalf of J.C. Espinas & Associates (p. 323, rec.). In his manifestation dated December 10, 1968, he
signed as B.C. Pineda, lone counsel for petitioner (p. 327, rec.); and yet, he carried the address of
Espinas & Associates at 716 G. Puyat Building, Escolta.
Same; Same; Sale; The Courts resolution which made null and void the orders for authority to sell issued
by Arbiter Valenzuela makes the sale of the Union property illegal.In view of Our resolution of October
18, 1983, which set aside as null and void the questioned orders dated September 23, 1982 and February
9, 1983 issued by Arbiter Raymundo Valenzuela, the sale of the Union property and the distribution of the
proceeds therefrom had been effected without authority and, therefore, illegal. Consequently, Atty. Pineda
and Arbiter Valenzuela become liable for their unauthorized acts.
Contempt; Labor Law; Contempt, defined.Contempt of court is a defiance of the authority, justice or
dignity of the court; such conduct as tends to bring the authority and administration of the law into
disrespect or to interfere with or prejudice parties litigant or their witnesses during litigation (12 Am. jur
389, cited in 14 SCRA 813).

Same; Same; Contempt powers inherent in all courts.This Court has thus repeatedly declared that the
power to punish for contempt is inherent in all courts and is essential to the preservation of order in
judicial proceedings and to the enforcement of judgments, orders, and mandates of the court, and
consequently, to the due administration of justice (Slade Perkins vs. Director of Prisons, 58 Phil. 271; In re
Kelly, 35 Phil. 944; Commissioner of Immigration vs. Cloribel, 20 SCRA 1241; Montalban vs. Canonoy,
38 SCRA 1).
Same; Same; Criminal contempt and civil contempt, defined and distinguished.In the matter of
exercising the power to punish contempts, this Court enunciated in the Slade Perkins case that the
exercise of the power to punish contempts has a twofold aspect, namely (1) the proper punishment of the
guilty party for his disrespect to the court or its order; and (2) to compel his performance of some act or
duty required of him by the court which he refuses to perform. Due to this twofold aspect of the exercise
of the power to punish them, contempts are classified as civil or criminal. A civil contempt is the failure to
do something ordered to be done by a court or a judge for the benefit of the opposing party therein; and a
criminal contempt, is conduct directed against the authority and dignity of a court or of a judge, as in
unlawfully assailing or discrediting the authority or dignity of a court or of a judge, or in doing a duly
forbidden act. Where the punishment imposed, whether against a party to a suit or a stranger, is wholly or
primarily to protect or vindicate the dignity and power of the court, either by fine payable to the
government or by imprisonment, or both, it is deemed a judgment in a criminal case. Where the
punishment is by fine directed to be paid to a party in the nature of damages for the wrong inflicted, or by
imprisonment as a coercive measure to enforce the performance of some act for the benefit of the party or
in aid of the final judgment or decree rendered in his behalf, the contempt judgment will, if made before
final decree, be treated as in the nature of an interlocutory order, or, if made after final decree, as remedial
in nature, and may be reviewed only on appeal from the final decree, or in such other mode as is
appropriate to the review of judgments in civil cases. x x x x x x x x x The question of whether the
contempt committed is civil or criminal, does not affect the jurisdiction or the power of a court to punish
the same.
Attorneys; Court may suspend or debar a lawyer whose acts show his unfitness to continue as a member
of the Bar.The Court may suspend or disbar a lawyer for any conduct on his part showing his unfitness
for the confidence and trust which characterize the attorney and client relations, and the practice of law
before the courts, or showing such a lack of personal honesty or of good moral character as to render him
unworthy of public confidence (7 C.J.S. 733).
Same; Statutory grounds for disbarment are not a limitation to the courts power in this respect.It is a
well-settled rule that the statutory grounds for disbarment or suspension are not to be taken as a limitation
on the general power of the courts in this respect. The inherent powers of the court over its officers cannot
be restricted (In re Pelaez, 44 Phil. 567).
Same; Criminal Law; An attorney may be criminally liable for breach of professional duty.The
aforequoted criminal sanction for unprofessional conduct of an attorney is without prejudice to proper
administrative action, such as disbarment or suspension of attorneys (p. 503, Criminal Law Annotated,
Padilla, 1972 Ed.).
Same; Same; Labor Law; A labor arbiter who acts beyond his authority may be prosecuted before the
Tanodbayan and held liable for disbarment.Labor Arbiter Raymundo Valenzuela should be made to
answer for having acted without or beyond his authority in proper administrative charges. He could also
be prosecuted before the Tanodbayan under the provisions of the Anti-Graft Law. Independently of his
liabilities as a government officer, he could be the subject of disbarment proceedings under Section 27,
Rule 138 of the Revised Rules of Court.
Jose D. Dula II
Atty. Gutierrez
Same; Same; A private attorney may be held liable criminally under the Anti-Graft Act for knowingly
inducing a public official to commit an offense.Atty. Benjamin Pineda could also be held liable under
Section 4(b) of R.A. No. 3019 (Anti-Graft and Corrupt Practices Act) which makes it unlawful for any
person knowingly to induce or cause any public official to commit any of the offenses defined in Section 3
of said act. Section 3 enumerates the corrupt practices which public officers may be prosecuted for. Atty.
Pineda knowingly induced or caused Labor Arbiter Valenzuela to issue the questioned orders without or
beyond the latters authority and to which orders the former was not entitled, considering that he was not
the sole and proper representative.
Contempt; Manila Banking Corporation could no longer be held in contempt after it obeyed the Courts
orders.The Manila Banking Corporation (Cubao Branch) per manifestation and motion dated October
28, 1983 and reiterated on November 10, 1983, had transmitted to the NLRC the remaining balance of
P417,380.64 and P2,022.70 for the account of the Union and Atty. Pineda, respectively. This turnover of
the aforecited amounts is a sufficient compliance with Our restraining order and resolution of September
13, 1983 and hence, the Manila Banking Corporation can no longer be liable for contempt of court.
Contempt; Labor Law; The Union is dropped from the contempt charge in view of its explanation.In the
same motion, Mr. Capuno clarifies that with regard to attorneys fees, Atty. Pineda made the Union
officers believe that he would be the one to pay the fees of Attys. Espinas and Lopez for which reason, the
35% increased fees was approved by the Unions board in good faith. The Union likewise confirms that
Atty. Pineda came into the picture only when he was assigned by Atty. Espinas in 1965 to execute the CIR
decision which, thru Atty. Espinas handling, was upheld by this Court in L-24864 in 1968. The Union
officers were aware that Atty. Espinas was the principal counsel even after Atty. Pinedas assignment.
They also knew of the original contract for 20% attorneys fees which was increased to 35% by Atty.
Pineda upon the arrangement that with the increase, he would answer for the payment of Attys. Espinas
and Lopez fees and for necessary representation expenses. Acting on the aforesaid motion, this Court in
its resolution of August 28, 1964, dropped the Union and its officers from the within contempt charge.
[Halili vs. Court of Industrial Relations, 136 SCRA 112(1985)]
Pacific Banking Corporation vs. Clave, 128 SCRA 112(1984)
Labor Law; Collective Bargaining Agreement; Attorneys Fees; Office of the President, without
jurisdiction to adjudicate attorneys fees of a lawyer who assisted the union president in negotiating the
agreement with the employer; Reason.We hold that, under the circumstances, the Office of the President
had no jurisdiction to make an adjudication on Saavedras attorneys fees. The case was appealed with
respect to the CBA terms and conditions, not with respect to attorneys fees. Although the fees were a
mere incident, nevertheless, the jurisdiction to fix the same and to order the payment thereof was outside
the pale of Claves appellate jurisdiction. He was right in adopting a hands-off attitude in his first
resolution and holding that the payment of the fees was a question between the lawyer and the union.
Same; Same; Same; Employees protected by law from unwarranted practices that diminish an employees
compensation without his knowledge and consent.Moreover, the case is covered squarely by the
mandatory and explicit prescription of article 222 which is another guarantee intended to protect the
employee against unwarranted practices that would diminish his compensation without his knowledge and
consent. (See National Power Corporation Supervisors Union vs. National Power Corporation, L-28805,
August 10, 1981, 106 SCRA 556).
Same; Same; Same; Payment of attorneys fees of lawyer is an obligation of the union, not the employees;
Money of employees, not to be used to pay the attorneys fees of a lawyer.There is no doubt that lawyer
Saavedra is entitled to the payment of his fees but article 222 ordains that union funds should be used for

that purpose. The amount of P345,000 does not constitute union funds. It is money of the employees. The
union, not the employees, is obligated to Saavedra. [Pacific Banking Corporation vs. Clave, 128 SCRA
112(1984)
Duyag vs. Inciong, 98 SCRA 522(1980)
Labor Law; The Bureau of Labor Relations has the power to remove a union officer from office.The
case has been simplified by the admission of the private respondents in page 13 of their memorandum that
the Bureau of Labor Relations has unquestionably the power to remove erring union officers under the last
paragraph of Article 242 of the Labor Code. That paragraph provides that any violation of the rights and
conditions of union membership, as enumerated in paragraphs (a) to (p) of Article 242. shall be a ground
for cancellation of union registration or expulsion of officer from office, whichever is appropriate. At least
thirty percent (30%) of all the members of a union or any member or members specially concerned may
report such violation to the Bureau (of Labor Relations). The Bureau shall have the power to hear and
decide any reported violation to mete the appropriate penalty.
Same; A union officers membership in another union and/or his organization of a stevedoring or hauling
family owned corporation competing with a union headed by him suffice to justify expulsion of a union
officer from his position.We hold that the Labor Arbiter did not err in removing the respondents as
union officers. The membership of Manalad and Puerto in another union is a sufficient ground for their
removal under the constitution and by-laws of the union. In Manalads case, his organization of a familyowned corporation competing with the union headed by him renders, it untenable that he should remain as
union president. We hold further that Manalad, Puerto and Leao violated the rights and conditions of
membership in the union within the meaning of Article 242. Hence, on that ground their expulsion from
office is also justified.
Same; The Director of the Bureau of Labor Relations should apply the law by removing erring union
officers and not let policy considerations prevail as to the laws intent and meaning.The Director should
apply the law and not make policy considerations prevail over its clear intent and meaning. The majority
of the laws need no interpretation or construction. They require only application, and if there were more
application and less construction, there would be more stability in the law, and more people would know
what the law is. (Lizarraga Hermanos vs. Yap Tico, 24 Phil. 504, 513). The labor officials should not
hesitate to enforce strictly the law and regulations governing trade unions even if that course of action
would curtail the so-called union autonomy and freedom from government interference.
Same; The Labor Ministry may order the books of a union examined.It is necessary and desirable that
the Bureau of Labor Relations and the Ministry of Labor should exercise close and constant supervision
over labor unions, particularly the handling of their funds, so as to forestall abuses and venalities. Hence,
the Director acted correctly in ordering an examination of the books and records of the union. The
examination should include a verification of the charge that the petty loans extended by the union to its
members were usurious and that the fee for the issuance of checks is unwarranted since the loans were
made in cash. [Duyag vs. Inciong, 98 SCRA 522(1980)]
Jose D. Dula II
Atty. Gutierrez
in what manner the cancellation of the permit of the Coto Labor Union made the petitioner an heir to the
union dues. On the other hand, the petitioner secured its own registration as a labor organization on 20
August 1963 while the registration of the Coto Labor Union was cancelled only on 22 November 1963. So
that between these two dates, both unions were simultaneously existing, precluding the idea of one union
being the successor of the other, and, furthermore, the Consolidated Workers Union would not have
entered into a consent election agreement with the Coto Labor Union if it did not recognize the existence
of the Coto Labor Union with whom it had contracted.
ID.; ID.; ID.; UNION DUES; PRELIMINARY INJUNCTION REGARDING DEPOSIT OF UNION
DUES PROPER IN INSTANT CASE. Complainant Coto Labor Union filed a motion for preliminary
injunction to enjoin Benguet Consolidated, Inc. and Consolidated Workers Union from negotiating and
concluding, between themselves, a new collective bargaining agreement; to enjoin the corporation from
turning over to the latter union, and for the latter to receive from the former, the dues collected from the
workers, and from disbursing said dues; and for the deposit into court of all dues collected or which may
thereafter be collected. The said motion makes out a prima facie showing of a right to the final relief
which is necessary to preserve the right asserted by the movant, and herein petitioner Consolidated
Workers Union admitted in its answer in the main case that deductions made pursuant to the previous
agreement between the company and the Coto Labor Union were subsequently turned over to the
Consolidated Workers Union from the time the company learned about the cancellation of the registration
permit of the Coto Labor Union. Hence, the lower court, even without the evidence alluded to by the
petitioner as necessary, had sufficient basis on record to support its order. The court acted reasonably, and
with fairness to the parties, and not abusively as charged, in adopting the remedial measure of ordering the
deposit of the union dues which were turned over to the herein petitioner, considering that the complaint
asked the Industrial Court to declare that the Consolidated Workers Union, petitioner herein, was either a
company union or was company dominated.
ID.; ID.; ID.; ID.; ID.; NO DEPRIVATION OF PROPERTY WITHOUT DUE PROCESS IN INSTANT
CASE. There is no merit to the argument of petitioner that the order directing the Consolidated
Workers Union to deposit in court the union dues involved constitutes deprivation of property without due
process of law. As pointed out in the appealed order, if the Industrial Court, after hearing, should
ultimately find that the Consolidated Workers Union is company dominated or is a company union and
order it dis-established, the result would be that petitioner would have to return all moneys and dues
collected by it from the workers, since the union would have had no authority to represent the workers.
Because the moneys collected might be improperly spent by the time the dis-establishment order is made,
it was logical for the court below to order that such moneys be deposited in the meantime.
ID.; ID.; ID.; ID.; ID.; POSTING OF BOND REQUIRED. It was error for the labor court not to
require the complainant-movant, Coto Labor Union (herein respondent), to file a bond for the issuance of
preliminary injunction. The posting of a bond under Section 4 of Rule 58 of the Rules of Court is a
condition sine qua non in order that the writ of preliminary injunction may issue (Siva, Et. Al. v. Reyes, Et
Al., 83 Phil. 416; Villarosa v. Teodoro, 100 Phil. 24).
CONSOLIDATED WORKERS UNION, Petitioner, v. COURT OF INDUSTRIAL RELATIONS,

ET AL.,Respondents.
Gabriel vs. Secretary of Labor and Employment, 328 SCRA 247(2000)
LABOR AND SOCIAL LEGISLATION; INDUSTRIAL PEACE ACT; LABOR UNIONS;

SUCCESSION OF UNIONS; CLAIM TO SUCCESSION IS NOT INDUBITABLE IN INSTANT CASE.
The petitioners claim to succession to the Coto Labor Union is not indubitable, for it has not spelled
out what proceedings were undertaken to effect the alleged change of name, and under what authority and
Labor Law; Labor Union; The system of check-off is primarily for the benefit of the union and only
indirectly for the individual employees.In check-off, the employer, on agreement with the Union, or on
prior authorization from employees, deducts union dues or agency fees from the latters wages and remits
them directly to the union. It assures continuous funding for the labor organization. As this Court has

acknowledged, the system of check-off is primarily for the benefit of the union and only indirectly for the
individual employees.
Same; Same; Requisites for the validity of the special assessment for unions incidental expenses,
attorneys fees and representation expenses.Article 241 has three (3) requisites for the validity of the
special assessment for unions incidental expenses, attorneys fees and representation expenses. These are:
1) authorization by a written resolution of the majority of all the members at the general membership
meeting called for the purpose; (2) secretarys record of the minutes of the meeting; and (3) individual
written authorization for check off duly signed by the employees concerned.
Same; Same; Same; Attorneys fees may not be deducted or checked off from any amount due to an
employee without his written consent.Clearly, attorneys fees may not be deducted or checked off from
any amount due to an employee without his written consent.
Same; Same; Same; A written individual authorization duly signed by the employee concerned is a
condition sine qua non for such deduction.Even as early as February 1990, in the case of Palacol vs.
Ferrer-Calleja we said that the express consent of employees is required, and this consent must be
obtained in accordance with the steps outlined by law, which must be followed to the letter. No shortcuts
are allowed. In Stellar Industrial Services, Inc. vs. NLRC we reiterated that a written individual
authorization duly signed by the employee concerned is a condition sine qua non for such deduction.
Same; Same; Same; Public respondent did not act with grave abuse of discretion in ruling that the workers
through their union should be made to shoulder the expenses incurred for the services of a lawyer.From
all the foregoing, we are of the considered view that public respondent did not act with grave abuse of
discretion in ruling that the workers through their union should be made to shoulder the expenses incurred
for the services of a lawyer. And accordingly the reimbursement should be charged to the unions general
fund or account. No deduction can be made from the salaries of the concerned employees other than those
mandated by law. [Gabriel vs. Secretary of Labor and Employment, 328 SCRA 247(2000)]
Vengco vs. Trajano, 173 SCRA 155(1989)
Labor Law; Labor Relations; Unions; Attorneys Fees; Check-Off; Attorneys fees may not be checked off
from any amount due to an employee without his written authorization, except for mandatory activity;
amicable settlement not a mandatory activity. ___ It is very clear from the above-quoted provision that
attorneys fees may not be deducted or checked off from any amount due to an employee without his
written consent except for mandatory activities under the Code. A mandatory activity has been defined as
a judicial process of settling dispute laid down by the law. (Carlos P. Galvadores, et al. vs. Cresenciano B.
Trajano, Director of the Bureau of Labor Relations, et al., G.R. No. L-70067, September 15, 1986, 144
SCRA 138). In the instant case, the amicable settlement entered into by the management and the union can
not be considered as a mandatory activity under the Code. It is true that the union filed a claim for
emergency cost of living allowance and other benefits before the Ministry of Labor. But this case never
reached its conclusion in view of the parties agreement. It is not also shown from the records that Atty.
Benjamin Sebastian was instrumental in forging the said agreement on behalf of the union members.
Same; Same; Same; Allowances are benefits over and above the basic salaries of the employees. ___
Moreover, Book III, Rule VIII, Section II of the Implementing Rules cited by Timbungco which dispenses
with the required written authorization from the employees concerned does not apply in this case. This
provision envisions a situation where there is a judicial or administrative proceedings for recovery of
wages. Upon termination of the proceedings, the law allows a deduction for attorneys fees of 10% from
the total amount due to a winning party. In the herein case, the fringe benefits received by the union
Jose D. Dula II
Atty. Gutierrez
members consist of back payments of their unpaid emergency cost of living allowances which are totally
distinct from their wages. Allowances are benefits over and above the basic salaries of the employees
(University of Pangasinan Faculty Union vs. University of Pangasinan, G.R.No. L-63122, February 20,
1984, 127 SCRA 691). We have held that such allowances are excluded from the concept of salaries or
wages (Cebu Institute of Technology (CIT) vs. Ople, G.R. No. L-58870, December 18, 1987, 156 SCRA
629). In addition, the payment of the fringe benefits were effected through an amicable settlement and not
in an administrative proceeding. [Vengco vs. Trajano, 173 SCRA 155(1989)]
Galvadores vs. Trajano, 144 SCRA 138(1986)
Labor Law; Attorneys; There can be no deduction from an employees salary for attorneys fees without
his written, signed authorization. A plebiscite is not enough.The provisions are clear. No check-offs
from any amounts due employees may be effected without individual written authorizations duly signed
by the employees specifically stating the amount, purpose and beneficiary of the deduction. The required
individual authorizations in this case are wanting. In fact, petitioner employees are vigorously objecting.
The question asked in the plebiscite, besides not being explicit, assumed that there was no dispute relative
to attorneys fees.
Same; Same; Words & Phrases; Placement of re-negotiations for a CBA under compulsory process does
not make it a mandatory activity as to authorize check-offs from employees salary for attorneys fees
without written, signed authorization.Contrary to respondent Unions and Counsels stand, the benefits
awarded to PLDT employees still formed part of the collective bargaining negotiations although placed
already under compulsory arbitration. This is not the mandatory activity under the Code which
dispenses with individual written authorizations for check-offs, notwithstanding its compulsory nature.
It is a judicial process of settling disputes laid down by law. Besides, Article 222(b) does not except a
CBA, later placed under compulsory arbitration, from the ambit of its prohibition. The cardinal principle
should be borne in mind that employees are protected by law from unwarranted practices that diminish
their compensation without their knowledge and consent.
Same; Same; Union funds respond for attorneys fees.ACCORDINGLY, the assailed Decision of
February 18, 1985 rendered by respondent Director of the Bureau of Labor Relations, is hereby SET
ASIDE. The attorneys fees herein involved may be charged against Union funds pursuant to Article
222(b) of the Labor Code, as may be agreed upon between them. [Galvadores vs. Trajano, 144 SCRA
138(1986)]
Continental Cement Corporation Labor Union(NLU) vs. Continental Cement Corporation, 189
SCRA 134(1990)
Labor Law; Strike is illegal if not in connection with any unresolved economic issue in collective
bargaining.Private respondent was engaged in the manufacture of cement which is no doubt a vital
industry in which a strike or lockout is prohibited under the foregoing aforestated decree. And even
assuming that private respondent was not engaged in a vital industry, the strike that was staged by
petitioner was nonetheless illegal. It was not in connection with any unresolved economic issue in
collective bargaining which is the only ground for which a lawful strike can be held.
Same;Dismissal of the uniono fficers, just penalty for their unlawful acts.Petitioner then contends that
the separation from work of the officers of the union is quite severe. The officers had the duty to guide
their members to respect the law. Instead, they urged them to violate the law and defy the duly constituted
authorities. Their responsibility is greater than that of the members. Their dismissal from the service is a

just penalty for their unlawful acts. [Continental Cement Corporation Labor Union(NLU) vs. Continental
Cement Corporation, 189 SCRA 134(1990)]
Aldovino vs. National Labor Relations Commission, 298 SCRA 526(1998)

Labor Law; Remedial Law; Res Judicata; Requisites.The petition lacks merit. For res judicata to apply
(a) the former judgment must be final; (b) the court which rendered it had jurisdiction over the subject
matter and the parties; (c) it must be a judgment on the merits; and, (d) there must be as between the first
and second actions identity of parties, subject matter and causes of action. Petitioners insist that the last
requisite of identity of parties, subject matter and causes of action in the case before the voluntary
arbitrator and the petition now before us is absent. They argue that they cannot be bound by the 7 January
1992 decision of Voluntary Arbitrator Batino inasmuch as that case involved only their union URFA on
one hand, and AG & P on the other.
Same; Same; Same; Only members of the petitioning union who did not signify their intention to
withdraw from the case before its trial and judgment on the merits are bound by the outcome of the case.
The right of URFA as a legitimate labor union to represent its members is expressly guaranteed under
Art. 242 of the Labor Code. This right, however, does not deprive its individual members of their
concomitant right to file a case in their own names, nor of their right to withdraw from any case filed by
the union in their behalf. More importantly, the individual member may seasonably exercise his option to
withdraw from a case filed by his union if he does not want to be bound thereby. In Philippine Land-AirSea Labor Union (PLASLU), Inc. v. CIR, this Court ruled that only those members of the petitioning
union who did not signify their intention to withdraw from the case before its trial and judgment on the
merits are bound by the outcome of the case. Since it has not been shown that Aldovino and Pimentel
withdrew from the case undergoing voluntary arbitration, it stands to reason that both are bound by the
decision rendered thereon. This obtaining, there is no doubting the identity of parties between the
arbitrated case and that brought by petitioners before the Labor Arbiter.
Same; Same; Same; The test to determine whether there is identity of causes of action is to ascertain
whether the same evidence necessary to sustain the second action would have been sufficient to authorize
a recovery in the first, even if the forms or nature of the two actions be different.Petitioners are now
barred by prior judgment from raising in this case the same issue of the legality of their layoffs. The test to
determine whether there is identity of causes of action is to ascertain whether the same evidence necessary
to sustain the second action would have been sufficient to authorize a recovery in the first, even if the
forms or nature of the two actions be different. For NLRC to allow Aldovino and Pimentel to prove that
they were illegally dismissed as a result of the extended layoff period would be to relitigate the validity
and reasonableness of the retrenchment program of AG & P, a matter already resolved by Voluntary
Arbitrator Batino and likewise settled in Revidad.
Same; Same; Same; It is to the interest of the public that there should be an end to litigation by the same
parties and their privies over a subject once fully and fairly adjudicated.It is to the interest of the public
that there should be an end to litigation by the same parties and their privies over a subject once fully and
fairly adjudicated. Interest republicae ut sit finis litium. There being no grave abuse of discretion on the
part of public respondent NLRC in its application of the principle of res judicata, all the other arguments
of petitioners have become academic, hence, need no longer be resolved. [Aldovino vs. National Labor
Relations Commission, 298 SCRA 526(1998)]
Sugbuanon Rural Bank, Inc. vs. Laguesma, 324 SCRA 425(2000)]
Jose D. Dula II
Atty. Gutierrez
Labor Law; Confidential Employees; Confidential employees are those who (1) assist or act in a
confidential capacity, in regard (2) to persons who formulate, determine, and effectuate management
policies [specifically in the field of labor relations].Now may the said bank personnel be deemed
confidential employees? Confidential employees are those who (1) assist or act in a confidential capacity,
in regard (2) to persons who formulate, determine, and effectuate management policies [specifically in the
field of labor relations]. The two criteria are cumulative, and both must be met if an employee is to be
considered a confidential employeethat is, the confidential relationship must exist between the
employee and his superior officer; and that officer must handle the prescribed responsibilities relating to
labor relations.
Same; Same; Right to Self-Organization; When the employee does not have access to confidential labor
relations information, there is no legal prohibition against confidential employees from forming, assisting,
or joining a union.Article 245 of the Labor Code does not directly prohibit confidential employees from
engaging in union activities. However, under the doctrine of necessary implication, the disqualification of
managerial employees equally applies to confidential employees. The confidential-employee rule justifies
exclusion of confidential employees because in the normal course of their duties they become aware of
management policies relating to labor relations. It must be stressed, however, that when the employee does
not have access to confidential labor relations information, there is no legal prohibition against
confidential employees from forming, assisting, or joining a union.
Same; Same; Same; Collective Bargaining Agreement; One of the rights of a legitimate labor organization
under Article 242(b) of the Labor Code is the right to be certified as the exclusive representative of all
employees in an appropriate bargaining unit for purposes of collective bargaining.One of the rights of a
legitimate labor organization under Article 242(b) of the Labor Code is the right to be certified as the
exclusive representative of all employees in an appropriate bargaining unit for purposes of collective
bargaining.
Same; Same; Same; Same; Certification Election; Article 257 of the Labor Code mandates that a
certification election shall automatically be conducted by the Med-Arbiter upon the filing of a petition by
a legitimate labor organization.Having complied with the requirements of Art. 234, it is our view that
respondent union is a legitimate labor union. Article 257 of the Labor Code mandates that a certification
election shall automatically be conducted by the MedArbiter upon the filing of a petition by a legitimate
labor organization. Nothing is said therein that prohibits such automatic conduct of the certification
election if the management appeals on the issue of the validity of the unions registration. On this score,
petitioners appeal was correctly dismissed. [Sugbuanon Rural Bank, Inc. vs. Laguesma, 324 SCRA
425(2000)]
St. Lukes Medical Center, Inc. vs. Torres, 223 SCRA 779(1993)
Labor Law; Labor Code; Considering public respondents expertise on the subject and his observance of
the cardinal principles of due process, the assailed order deserves to be accorded great respect by this
Court.We rule that the Order, particularly in its disposition on the economic issues, was not arbitrarily
imposed by public respondent. A perusal of the Order shows that public respondent took into
consideration the parties respective contentions, a clear indication that he was keenly aware of their
contrary positions. Both sides having been heard, they were allowed to present their respective evidence.
The due process requirement was thus clearly observed. Considering public respondents expertise on the
subject and his observance of the cardinal principles of due process, the assailed Order deserves to be
accorded great respect by this Court.

Same; Same; Labor Organization; A duly registered local union affiliated with a national union or
federation does not lose its legal personality or independence.Only the collective bargaining agent, the
local union SLMCEA in this case, possesses legal standing to negotiate with petitioner. A duly registered
local union affiliated with a national union or federation does not lose its legal personality or
independence.
Remedial Law; Jurisdiction; A party cannot invoke the jurisdiction of a Court to secure affirmative relief
against his opponent and after failing to obtain such relief, repudiate or question that same jurisdiction.
It is a settled rule that a party cannot invoke the jurisdiction of a court to secure affirmative relief against
his opponent and after failing to obtain such relief, repudiate or question that same jurisdiction. A party
cannot invoke jurisdiction at one time and reject it at another time in the same controversy to suit its
interests and convenience. The Court frowns upon and does not tolerate the undesirable practice of some
litigants who submit voluntarily a cause and then accepting the judgment when favorable to them and
attacking it for lack of jurisdiction when adverse. [St. Lukes Medical Center, Inc. vs. Torres, 223 SCRA
779(1993)]
Malayang Samahan ng mga Manggagawa sa M. Greenfield vs. Ramos, 326 SCRA 428(2000)
Labor Law; National Labor Relations Commission; There is nothing irregular in the temporary
designation of an NLRC Commissioner from one division to complete another division, for the law
empowers the Chairman to make temporary assignments whenever the required concurrence is not met;
The territorial divisions of the National Labor Relations Commission do not confer exclusive jurisdiction
to each division and are merely designed for administrative efficiency.It must be remembered that
during the pendency of the case in the First Division of the NLRC, one of the three commissioners,
Commissioner Romeo Putong, retired, leaving Chairman Bartolome Carale and Commissioner Vicente
Veloso III. Subsequently, Commissioner Veloso inhibited himself from the case because the counsel for
the petitioners was his former classmate in law school. The First Division was thus left with only one
commissioner. Since the law requires the concurrence of two commissioners to arrive at a judgment or
resolution, the Commission was constrained to temporarily designate a commissioner from another
division to complete the First Division. There is nothing irregular at all in such a temporary designation
for the law empowers the Chairman to make temporary assignments whenever the required concurrence is
not met. The law does not say that a commissioner from the first division cannot be temporarily assigned
to the second or third division to fill the gap or vice versa. The territorial divisions do not confer exclusive
jurisdiction to each division and are merely designed for administrative efficiency.
Same; Collective Bargaining Agreements; Union Security Clauses; Due Process; Although union security
clauses embodied in the collective bargaining agreement may be validly enforced and dismissals pursuant
thereto may likewise be valid, this does not erode the fundamental requirement of due process.This
ruling of the NLRC is erroneous. Although this Court has ruled that union security clauses embodied in
the collective bargaining agreement may be validly enforced and that dismissals pursuant thereto may
likewise be valid, this does not erode the fundamental requirement of due process. The reason behind the
enforcement of union security clauses which is the sanctity and inviolability of contracts cannot override
ones right to due process.
Same; Same; Same; Same; An employer cannot rely merely upon a labor federations allegations in
terminating union officers expelled by the federation for allegedly committing acts of disloyalty and lor
inimical to the interest of the federation and in violation of its Constitution and By-Lawsthe company
must also inquire into the cause of the expulsion and whether or not the federation had sufficient grounds
to effect the same.In the case under scrutiny, petitioner union officers were expelled by the federation
for allegedly committing acts of disloyalty and/or inimical to the interest of ULGWP and in violation of its
Jose D. Dula II
Atty. Gutierrez
Constitution and By-laws. Upon demand of the federation, the company terminated the petitioners without
conducting a separate and independent investigation. Respondent company did not inquire into the cause
of the expulsion and whether or not the federation had sufficient grounds to effect the same. Relying
merely upon the federations allegations, respondent company terminated petitioners from employment
when a separate inquiry could have revealed if the federation had acted arbitrarily and capriciously in
expelling the union officers. Respondent companys allegation that petitioners were accorded due process
is belied by the termination letters received by the petitioners which state that the dismissal shall be
immediately effective.
Same; Same; Same; Same; The right of an employee to be informed of the charges against him and to
reasonable opportunity to present his side in a controversy with either the company or his own union is not
wiped away by a union security clause or a union shop clause in a collective bargaining agreement.As
held in the aforecited case of Carino, the right of an employee to be informed of the charges against him
and to reasonable opportunity to present his side in a controversy with either the company or his own
union is not wiped away by a union security clause or a union shop clause in a collective bargaining
agreement. An employee is entitled to be protected not only from a company which disregards his rights
but also from his own union the leadership of which could yield to the temptation of swift and arbitrary
expulsion from membership and mere dismissal from his job.
Same; Same; Same; Same; Even assuming that a federation had valid grounds to expel union officers, due
process requires that these union officers be accorded a separate hearing by the company. While
respondent company may validly dismiss the employees expelled by the union for disloyalty under the
union security clause of the collective bargaining agreement upon the recommendation by the union, this
dismissal should not be done hastily and summarily thereby eroding the employees right to due process,
self-organization and security of tenure. The enforcement of union security clauses is authorized by law
provided such enforcement is not characterized by arbitrariness, and always with due process. Even on the
assumption that the federation had valid grounds to expel the union officers, due process requires that
these union officers be accorded a separate hearing by respondent company.
Same; Same; Same; Intra-Union Disputes; Illegal Dismissal; While it is true that the issue of expulsion of
local union officers is originally between the local union and the federation, hence, intraunion in character,
the issue is later on converted into a termination dispute when the company dismisses the union officers
from work without the benefit of a separate notice and hearing; Notwithstanding the fact that the dismissal
was at the instance of a labor federation which undertook to hold the company free from any liability
resulting from such a dismissal, the company may still be held liable if it was remiss in its duty to accord
the would-be dismissed employees their right to be heard on the matter.In its decision, public
respondent also declared that if complainants (herein petitioners) have any recourse in law, their right of
action is against the federation and not against the company or its officers, relying on the findings of the
Labor Secretary that the issue of expulsion of petitioner union officers by the federation is a purely intraunion matter. Again, such a contention is untenable. While it is true that the issue of expulsion of the local
union officers is originally between the local union and the federation, hence, intra-union in character, the
issue was later on converted into a termination dispute when the company dismissed the petitioners from
work without the benefit of a separate notice and hearing. As a matter of fact, the records reveal that the
termination was effective on the same day that the termination notice was served on the petitioners, x x x
Thus, notwithstanding the fact that the dismissal was at the instance of the federation and that it undertook
to hold the company free from any liability resulting from such a dismissal, the company may still be held
liable if it was remiss in its duty to accord the would-be dismissed employees their right to be heard on the
matter.

Same; Same; Same; Same; Jurisdiction; The issue of whether or not the federation had reasonable grounds
to expel the petitioner union officers is properly within the original and exclusive jurisdiction of the
Bureau of Labor Relations, being an intra-union conflict.Although the issue of whether or not the
federation had reasonable grounds to expel the petitioner union officers is properly within the original and
exclusive jurisdiction of the Bureau of Labor Relations, being an intra-union conflict, this Court deems it
justifiable that such issue be nonetheless ruled upon, as the Labor Arbiter did, for to remand the same to
the Bureau of Labor Relations would be to intolerably delay the case.
Same; Evidence; The Supreme Court will not uphold erroneous conclusions of the National Labor
Relations Commission as when it finds insufficient or insubstantial evidence on record to support those
factual; findings, or when it is perceived that far too much is concluded, inferred or deduced from the bare
or incomplete facts appearing of record.It is well-settled that findings of facts of the NLRC are entitled
to great respect and are generally binding on this Court, but it is equally well-settled that the Court will not
uphold erroneous conclusions of the NLRC as when the Court finds insufficient or insubstantial evidence
on record to support those factual findings. The same holds true when it is perceived that far too much is
concluded, inferred or deduced from the bare or incomplete facts appearing of record.
Same; Unions; Disaffiliations; Freedom of Association; A local union has the right to disaffiliate from its
mother union or declare its autonomy, and such disaffiliation cannot be considered disloyalty; In the
absence of specific provisions in the federations constitution prohibiting disaffiliation or the declaration
of autonomy of a local union, a local union may dissociate from its parent union.A local union has the
right to disaffiliate from its mother union or declare its autonomy. A local union, being a separate and
voluntary association, is free to serve the interests of all its members including the freedom to disaffiliate
or declare its autonomy from the federation to which it belongs when circumstances warrant, in
accordance with the constitutional guarantee of freedom of association, x x x Thus, a local union which
has affiliated itself with a federation is free to sever such affiliation anytime and such disaffiliation cannot
be considered disloyalty. In the absence of specific provisions in the federations constitution prohibiting
disaffiliation or the declaration of autonomy of a local union, a local may dissociate with its parent union.
Same; Same; Strikes; Unfair Labor Practices; Even if the allegations of unfair labor practice are
subsequently found out to be untrue, the presumption of legality of the strike prevails.On the
submission that the strike was illegal for being grounded on a non-strikeable issue, that is, the intra-union
conflict between the federation and the local union, it bears reiterating that when respondent company
dismissed the union officers, the issue was transformed into a termination dispute and brought respondent
company into the picture. Petitioners believed in good faith that in dismissing them upon request by the
federation, respondent company was guilty of unfair labor practice in that it violated the petitioners right
to self-organization. The strike was staged to protest respondent companys act of dismissing the union
officers. Even if the allegations of unfair labor practice are subsequently found out to be untrue, the
presumption of legality of the strike prevails.
Same; Same; Same; Same; No Strike, No Lockout Clause; A no strike, no lockout provision can only be
invoked when the strike is economic in nature, i.e., to force wage or other concessions from the employer
which he is not required by law to grant.Another reason why the Labor Arbiter declared the strike
illegal is due to the existence of a no strike, no lockout provision in the CBA. Again, such a ruling is
erroneous. A no strike, no lock out provision can only be invoked when the strike is economic in nature,
i.e. to force wage or other concessions from the employer which he is not required by law to grant. Such a
provision cannot be used to assail the legality of a strike which is grounded on unfair labor practice, as
was the honest belief of herein petitioners. Again, whether or not there was indeed unfair labor practice
does not affect the strike.
Jose D. Dula II
Atty. Gutierrez
Same; Same; Same; Where violence was committed on both sides during a strike, such violence cannot be
a ground for declaring the strike as illegal.On the allegation of violence committed in the course of the
strike, it must be remembered that the Labor Arbiter and the Commission found that the parties are
agreed that there were violent incidents x x x resulting to injuries to both sides, the union and
management. The evidence on record show that the violence cannot be attributed to the striking
employees alone for the company itself employed hired men to pacify the strikers. With violence
committed on both sides, the management and the employees, such violence cannot be a ground for
declaring the strike as illegal.
Same; Abandonment; Requisites.Jurisprudence holds that for abandonment of work to exist, it is
essential (1) that the employee must have failed to report for work or must have been absent without valid
or justifiable reason; and (2) that there must have been a clear intention to sever the employer-employee
relationship manifested by some overt acts. Deliberate and unjustified refusal on the part of the employee
to go back to his work post and resume his employment must be established. Absence must be
accompanied by overt acts unerringly pointing to the fact that the employee simply does not want to work
anymore. And the burden of proof to show that there was unjustified refusal to go back to work rests on
the employer.
Same; Same; The filing of a complaint for illegal dismissal is inconsistent with the allegation of
abandonment.This Court has ruled that an employee who took steps to protest his lay-off cannot be
said to have abandoned his work. The filing of a complaint for illegal dismissal is inconsistent with the
allegation of abandonment. In the case under consideration, the petitioners did, in fact, file a complaint
when they were refused reinstatement by respondent company.
Same; Union Security Clauses; Unfair Labor Practices; Due Process; Dismissals pursuant to union
security clauses are valid and legal subject only to the requirement of due process; Dismissal of an
employee by the company pursuant to a labor unions demand in accordance with a union security
agreement does not constitute unfair labor practice.Anent public respondents finding that there was no
unfair labor practice on the part of respondent company and federation officers, the Court sustains the
same. As earlier discussed, union security clauses in collective bargaining agreements, if freely and
voluntarily entered into, are valid and binding. Corrolarily, dismissals pursuant to union security clauses
are valid and legal subject only to the requirement of due process, that is, notice and hearing prior to
dismissal. Thus, the dismissal of an employee by the company pursuant to a labor unions demand in
accordance with a union security agreement does not constitute unfair labor practice.
Same; Corporation Law; Company officials cannot be held personally liable for damages on account of
the employees dismissal because the employer corporation has a personality separate and distinct from its
officers who merely acted as its agents.The Court is of the opinion, and so holds, that respondent
company officials cannot be held personally liable for damages on account of the employees dismissal
because the employer corporation has a personality separate and distinct from its officers who merely
acted as its agents.
Same; Illegal Dismissal; Backwages; An employee who is dismissed, whether or not for just or authorized
cause but without prior notice of his termination, is entitled to full backwages from the time he was
terminated until the decision in his case becomes final, when the dismissal was for cause; and in case the
dismissal was without just or valid cause, the backwages shall be computed from the time of his dismissal
until his actual reinstatement.In Ruben Serrano vs. NLRC and Isetann Department Store (G.R. No.
117040, January 27, 2000), the Court ruled that an employee who is dismissed, whether or not for just or
authorized cause but without prior notice of his termination, is entitled to full backwages from the time he
was terminated until the decision in his case becomes final, when the dismissal was for cause; and in case

the dismissal was without just or valid cause, the backwages shall be computed from the time of his
dismissal until his actual reinstatement. In the case at bar, where the requirement of notice and hearing
was not complied with, the aforecited doctrine laid down in the Serrano case applies. [Malayang Samahan
ng mga Manggagawa sa M. Greenfield vs. Ramos, 326 SCRA 428(2000)]
Atlas Lithographic Services, Inc. vs. Laguesma, 205 SCRA 12(1992)]
Labor Law; Labor Relations; Managerial employee is one who is vested with powers or prerogatives to
lay down and execute management policies. A Supervisory employee is one who effectively recommends
managerial actions in the interest of the employer.The definition of managerial employees was limited
to those having authority to hire and fire while those who only recommend effectively the hiring or firing
or transfers of personnel would be considered as closer to rankand-file employees. The exclusion,
therefore, of middle level executives from the category of managers brought about a third classification,
the supervisory employees. These supervisory employees are allowed to form their own union but they are
not allowed to join the rank-and-file union because of conflict of interest (Journal of the Senate, First
Regular Session, 1987-1988, Volume 3, p. 2245).
Jose D. Dula II
Atty. Gutierrez
case, we start with the recognized rule that the right of supervisory employees to organize under the
Industrial Peace Act carries certain restrictions but the right itself may not be denied or unduly abridged.
The supervisory employees of an employer cannot join any labor organization of employees under their
supervision but may validly form a separate organization of their own. As stated in Caltex Filipino
Managers and Supervisors Association v. Court of Industrial Relations (47 SCRA 112), it would be to
attach unorthodoxy to, not to say an emasculation of, the concept of law if managers as such were
precluded from organizing. Thus, if Republic Act 875, in its Section 3, recognizes the right of supervisors
to form a separate organization of their own, albeit they cannot be members of a labor organization of
employees under their supervision, that authority of supervisors to form a separate labor union carries with
it the right to bargain collectively with the employer. (Government Service Insurance System v.
Government Service Insurance System Supervisors Union (68 SCRA 418).
Same; Same; Affiliation by a duly registered local union with a national union or federation does not make
the local union lose its legal personality.There is nothing in the provisions of the Industrial Peace Act
which provides that a duly registered local union affiliating with a national union or federation loses its
legal personality, or its independence.
Same; Same; Ineligibility of managerial employees to join any labor organization; Right of supervisory
employees; 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.The
prohibition against a supervisors' union joining a local union of rank-and-file is replete with jurisprudence.
The Court emphasizes that the limitation is not confined to a case of supervisors wanting to join a rankand-file local union. The prohibition extends to a supervisors' local union applying for membership in a
national federation the members of which include local unions of rank-and-file employees. The intent of
the law is clear especially where, as in the case at bar, the supervisors will be comingling with those
employees whom they directly supervise in their own bargaining unit. Technicalities should not be
allowed to stand in the way of equitably and completely resolving the rights and obligations of the parties.
(Rapid Manpower Consultants, Inc. vs. NLRC, 190 SCRA 747 [1990]) What should be paramount is the
intent behind the law, not its literal construction. Where one interpretation would result in mischievous
consequences while another would bring about equity, justice, and the promotion of labor peace, there can
be no doubt as to what interpretation shall prevail. [Atlas Lithographic Services, Inc. vs. Laguesma, 205
SCRA 12(1992)]
Same; Same; Same; Despite affiliation, the local union remained the basic unit free to serve the common
interest of all its members.In other words, notwithstanding affiliation, the local union remained the
basic unit free to serve the common interest of all its members. [Adamson & Adamson, Inc. vs. CIR, 127
SCRA 268(1984)]
Adamson & Adamson, Inc. vs. CIR, 127 SCRA 268(1984)
Same; Same; Same; Same; One union for every industry policy should not violate the constitutional
mandate of protecting labor and the workers right to self organization; Workingmens welfare, the
paramount consideration in the implementation of the Labor Code and its implementing regulations;
Restricting the right to self-organization due to the existence of a collective bargaining agreement would
go against the spirit of the labor law.In reversing the Med-Arbiters resolution, respondent Bureau
declared: the Department of Labor is set on a task to restructure the labor movement to the end that the
workers will unite themselves along industry lines. Carried to its complete fruition, only one union for
every industry will remain to bargain collectively for the workers. The clear policy therefore even now is
to conjoin workers and worker groups, not to dismember them. This policy is commendable. However, we
must not lose sight of the constitutional mandate of protecting labor and the workers right to selforganization. In the implementation and interpretation of the provisions of the Labor Code and its
implementing regulations, the workingmans welfare should be the primordial and paramount
consideration. In the case at bar, it would go against the spirit of the labor law to restrict petitioners right
to self-organization due to the existence of the CBA. We agree with the Med-Arbiters opinion that A
disaffiliation does not disturb the enforceability and administration of a collective agreement; it does not
occasion a change of administrators of the contract nor even an amendment of the provisions thereof. But
Labor Law; Constitutional Law; Right of employees to self-organization and to form, join or assist labor
organizations of their own choosing for the purpose of collective bargaining and to engage in concerted
activities.The right of employees to self-organization and to form, join or assist labor organizations of
their own choosing for the purpose of collective bargaining and to engage in concerted activities for
mutual aid or protection is a fundamental right of labor that derives its existence from the Constitution. It
is recognized and implemented through the abovecited Section 3 of the Industrial Peace Act as amended.
Same; Same; Interpretation; Liberal approach in implementing constitutional mandates on labor favors
exercise of labor rights.In interpreting the protection to labor and social justice provisions of the
Constitution and the labor laws or rules and regulations implementing the constitutional mandates, we
have always adopted the liberal approach which favors the exercise of labor rights.
Same; Labor Organizations; Prohibition on supervisory employees of employer from joining any labor
organization of employees, although they may validly form a separate organization of their own; Authority
of supervisors to form a separate labor union includes the right to bargain collectively.In deciding this
Volkschel Labor Union vs. Bureau of Labor Relations, 137 SCRA 42(1985)
Labor Law; Unions; Disaffiliation; Constitutional Law; Right of a local union to disaffiliate from its
mother union; Freedom of local union to serve the interest of all its members, including the freedom to
disaffiliate; Right to disaffiliate is consistent with the constitutional guarantee of freedom of association.
The right of a local union to disaffiliate from its mother union is well-settled. In previous cases, it has been
repeatedly held that a local union, being a separate and voluntary association, is free to serve the interest
of all its members including the freedom to disaffiliate when circumstances warrant. This right is
consistent with the Constitutional guarantee of freedom of association (Article IV, Section 7, Philippine
Constitution).
Jose D. Dula II
Atty. Gutierrez
nowhere in the record does it appear that the contract entered into by the petitioner and ALUMETAL
prohibits the withdrawal of the former from the latter.
opportunity to air their side and explain their moves. If, after an investigation the petitioners were found to
have violated union rules, then and only then should they be subjected to proper disciplinary measures.
Same; Same; Same; Same; Check-off; Obligation of employee to pay union dues is co-terminous with his
affiliation or membership; A contract between an employee and the parent organization as bargaining
agent for employees, terminated by the disaffiliation of the local union.This now brings us to the second
issue. Under Section 3, Article I, of the CBA, the obligation of the respondent companies to deduct and
remit dues to ALUMETAL is conditioned on the individual check-off authorization of petitioners
members. In other words, ALUMETAL is entitled to receive the dues from respondent companies as long
as petitioner union is affiliated with it and respondent companies are authorized by their employees
(members of petitioner union) to deduct union dues. Without said affiliation, the employer has no link to
the mother union. The obligation of an employee to pay union dues is co-terminous with his affiliation or
membership. The employees check-off authorization, even if declared irrevocable, is good only as long
as they remain members of the union concerned. A contract between an employer and the parent
organization as bargaining agent for the employees is terminated by the disaffiliation of the local of which
the employees are members. Respondent companies therefore were wrong in continuing the check-off in
favor of respondent federation since they were duly notified of the disaffiliation and of petitioners
members having already rescinded their check-off authorization.
Same; Same; Same; Same; The need for a company investigation is founded on the consistent ruling of the
Court that the twin requirements of notice and hearing which are essential elements of due process must
be met in employment-termination cases.The need for a company investigation is founded on the
consistent ruling of this Court that the twin requirements of notice and hearing which are essential
elements of due process must be met in employment-termination cases. The employee concerned must be
notified of the employers intent to dismiss him and of the reason or reasons for the proposed dismissal.
The hearing affords the employee an opportunity to answer the charge or charges against him and to
defend himself therefrom before dismissal is effected.
Same; Same; Same; Same; Same; Entitlement by local union which has disaffiliated and continued to
represent the employees of an employer to check-off dues under a collective bargaining contract.Suffice
it to state that respondent federation is not entitled to union dues payments from petitioners members. A
local union which has validly withdrawn from its affiliation with the parent association and which
continues to represent the employees of an employer is entitled to the check-off dues under a collective
bargaining contract. [Volkschel Labor Union vs. Bureau of Labor Relations, 137 SCRA 42(1985)]
Same; Same; Same; Same; The need for the observance of an employees right to procedural due process
in termination cases cannot be overemphasized.If an employee may be considered illegally dismissed
because he was not accorded fair investigation (Hellenic Philip-pine Shipping vs. Siete, 195 SCRA 179
[1991]), the more reason there is to strike down as an inexcusable and disdainful rejection of due process a
situation where there is no investigation at all (See: Collegio del Sto. Nio vs. NLRC, 197 SCRA 611
[1991]; Artex Development Co., Inc. vs. NLRC, 187 SCRA 611 [1990]). The need for the observance of
an employees right to procedural due process in termination cases cannot be overemphasized. After all,
ones employment, profession, trade, or calling is a property right and the wrongful interference
therewith gives rise to an actionable wrong (Callanta vs. Carnation Philippines, Inc., 145 SCRA 268
[1986]). Verily, a mans right to his labor is property within the meaning of constitutional guarantees
which he cannot be deprived of without due process.
Ferrer vs. National Labor Relations Commission, 224 SCRA 410(1993)

Labor Law; Labor Unions; Collective Bargaining; A CBA provision for a closed shop is a valid form of
union security and it is not a restriction on the right or freedom of association guaranteed by the
Constitution.A CBA is the law between the company and the union and compliance therewith is
mandated by the express policy to give protection to labor. Said policy should be given paramount
consideration unless otherwise provided for by law (Meycauayan College vs. Drilon, 185 SCRA 50
[1990]). A CBA provision for a closed shop is a valid form of union security and it is not a restriction on
the right or freedom of association guaranteed by the Constitution (Lirag Textile Mills, Inc. vs. Blanco,
109 SCRA 87 [1981]). However, in the implementation of the provisions of the CBA, both parties thereto
should see to it that no right is violated or impaired.
Same; Same; Same; Due Process; The manner in which the dismissal was enforced left much to be desired
in terms of respect for the right of petitioners to procedural due process.In the case at bar, while it is true
that the CBA between OFC and the SAMAHAN provided for the dismissal of employees who have not
maintained their membership in the union, the manner in which the dismissal was enforced left much to be
desired in terms of respect for the right of petitioners to procedural due process.
Same; Same; Same; Same; Same; The SAMAHAN should have observed its own constitution and bylaws by giving petitioner an opportunity to air their side and explain their moves.No hearing
(pandinig) was ever conducted by the SAMAHAN to look into peti-tioners explanation of their moves
to oust the union leadership under Capitle, or their subsequent affiliation with FEDLU. While it is true that
petitioners actions might have precipitated divisiveness and, later, showed disloyalty to the union, still,
the SAMAHAN should have observed its own constitution and by-laws by giving petitioners an
Same; Same; Same; Same; Even if no hearing is conducted, the requirement of due process would have
been met where a chance to explain a partys side of the controversy had been accorded him.
Observance to the letter of company rules on investigation of an employee about to be dismissed is not
mandatory. It is enough that there is due notice and hearing before a decision to dismiss is made (Mendoza
vs. NLRC, 195 SCRA 606 [1991]). But even if no hearing is conducted, the requirement of due process
would have been met where a chance to explain a partys side of the controversy had been accorded him.
Same; Same; Same; Same; While the law recognizes the right of an employer to dismiss employees in
warranted cases, it frowns upon arbitrariness as when employees are not accorded due process.While
the law recognizes the right of an employer to dismiss employees in warranted cases, it frowns upon
arbitrariness as when employees are not accorded due process (Tan, Jr. vs. NLRC, 183 SCRA 651 [1990]).
Thus, the prerogatives of the OFC to dismiss petitioners should not have been whimsically done for it
unduly exposed itself to a charge of unfair labor practice for dismissing petitioners in line with the closed
shop provision of the CBA, without a proper hearing.
Same; Same; Same; Same; While termination of employment is traditionally considered a management
prerogative, it is not an absolute prerogative subject as it is to limitations founded in law, the CBA or
general principles of fair play and justice.Neither can the manner of dismissal be considered within the
ambit of managerial prerogatives, for while termination of employment is traditionally considered a
management prerogative, it is not an absolute prerogative subject as it is to limitations founded in law, the
CBA, or general principles of fair play and justice.
Same; Same; Same; The right of a local union to disaffiliate from a federation in the absence of any
provision in the federations constitution preventing disaffiliation of a local union is legal.
Parenthetically, the right of a local union to disaffiliate from a federation in the absence of any provision
in the federations constitution preventing disaffiliation of a local union is legal (Peoples Industrial and

Commercial Employees and Workers Org. (FFW) vs. Peoples Industrial and Commercial Corp., 112
SCRA 440 [1982]). Such right is consistent with the constitutional guarantee of freedom of association.
Same; Dismissal; Benefits; A legally dismissed employee may now be paid his back wages, allowances,
and other benefits for the entire period he was out of work subject to the rule enunciated before the
Mercury Drug Rule which is that the employer may, however, deduct any amount which the employee
may have earned during the period of his illegal termination.A legally dismissed employee may now be
paid his back wages, allowances, and other benefits for the entire period he was out of work subject to the
rule enunciated before the Mercury Drug Rule, which is that the employer may, however, deduct any
amount which the employee may have earned during the period of his illegal termination (East Asiatic
Company, Ltd. vs. Court of Industrial Relations, 40 SCRA 521 [1971]). Computation of full back wages
and presentation of proof as to income earned elsewhere by the illegally dismissed employee after his
termination and before actual reinstatement should be ventilated in the execution proceedings before the
Labor Arbiter concordant with Section 3, Rule 8 of the 1990 new Rules of Procedure of the National
Labor Relations Commission. [Ferrer vs. National Labor Relations Commission, 224 SCRA
410(1993)]
Liberty Cotton Mills Workers Union vs. Liberty Cotton Mills, Inc., 66 SCRA 512(1975)
Labor relations; Labor unions; Status of national union in relation to local union affiliated with it; Case at
bar.In the Collective Bargaining Agreements, it appears that PAFLU has been recognized as the sole
bargaining agent for all the employees of the Company other than its supervisors and security guards. The
PAFLU, acting for and in behalf of its affiliate, had the status of an agent while the local union remained
the basic unit of the association free to serve the common interest of all its members including the freedom
to disaffiliate when the circumstances warrant. This is clearly provided in its Constitution and By-Laws,
specifically Article X on Union Affiliation.
Same; Same; Validity of disaffiliation by local union from national union where disaffiliation in
accordance with unions Constitution and By-Laws; Case at bar.Under the unions Constitution and ByLaws, the local union shall be affiliated with the PAFLU, and shall remain an affiliate as long as ten or
more of its members evidence their desire to continue the said local unions affiliation. The record shows
that only four out of its members remained for 32 out of the 36 members of the Union signed the
resolution of disaffiliation. The disaffiliation was, therefore, valid under the locals Constitution and ByLaws which, taken together with the Collective Bargaining Agreement, is controlling. The disaffiliation,
coming as it did from the greater majority of its members, is more than enough to show the collective
desire of the members of the local union to sever their relations from the mother federation. The right of
disaffiliation is inherent in the compact and such act should not have been branded as an act of disloyalty,
especially considering the cause which impelled the union to take such a step.
Same; Same; Dismissal of employees who signed resolution of disaffiliation; Where dismissal at the
instance of the national union, liability of company limited only to reinstatement of employees dismissed;
Case at bar.Acting on the request of the mother federation the Company sent notices of termination to
the officers of the local union, heavily relying on the Collective Bargaining Agreement. The stipulation in
the Collective Bargaining Agreement does not bind the courts much less released the Company from
liability should a finding for unfair labor practice be positive. `However, considering that the dispute
revolved around the mother federation and its local, with the company dismissing the workers at the
instance of the mother federation, the Companys liability should be limited to the immediate
reinstatement of the workers.
Jose D. Dula II
Atty. Gutierrez
Same; Same; Same; Liability of national union to pay backwages of dismissed employees; Payment of
backwages equivalent to three years wages without deduction or qualification.Considering that the
dismissal of the employees was effected without previous hearing, and at the instance of PAFLU, this
mother federation should be held liable to the dismissed Employees for the payment of their back wages.
Following the precedent of Mercury Drug Co. vs. CIR, of fixing an amount of net backwages and doing
away with the protracted process of determining the complainants-workers earnings elsewhere during the
period of their illegal dismissal, the Court fixes the amount of backwages to be paid under this decision to
the complainants-workers at three (3) years backwages without deduction or qualification. [Liberty Cotton
Mills Workers Union vs. Liberty Cotton Mills, Inc., 66 SCRA 512(1975)]
Philippine Labor Alliance Council (PLAC) vs. Bureau of Labor Relations, 75 SCRA 162(1977)
Labor law; Constitutional law; Disaffiliation from a labor union is not open to any legal objection. It is
implicit in the freedom of association ordained by the Constitution.It is indisputable that the present
controversy would not have arisen if there were no mass disaffiliation from petitioning union. Such a
phenomenon is nothing new in the Philippine labor movement. Nor is it open to any legal objection. It is
implicit in the freedom of association explicitly ordained by the Constitution. There is then the
incontrovertible right of any individual to join an organization of his choice. That option belongs to him. A
working man is not to be denied that liberty.
Same; Once disaffiliation has been demonstrated beyond doubt, a certification election is the most
expeditious way of determining who should be the exclusive bargaining representative of the employees.
Once the fact of disaffiliation has been demonstrated beyond doubt, as in this case, a certification
bargaining representative. It is as simple as that.
Same; The contract-bar rule cannot be invoked where there has been a valid decertification of a collective
bargaining agreement.The contract-bar rule could then be invoked by petitioner. It is, as pointed out by
Justice Fernandez in Confederation of Citizens Labor Unions v. National Labor Relations Commission, a
principle in labor law that a collective bargaining agreement of reasonable duration is, in the interest of the
stability of industrial relations, a bar to certification elections. Even then, as was pointed out in the justcited Philippine Association of Free Labor Unions decision, it is not to be applied with rigidity. x x x The
element of flexibility in its operation cannot be ignored. In this controversy, however, such a principle is
not applicable. The collective bargaining agreement entered into by petitioner with management on March
9, 1974 was decertified in the challenged order of April 8, 1975. The power to decertify by respondent
Bureau is not disputed. It is the exercise thereof that is now assailed. If done arbitrarily, there is valid
ground for complaint. The due process clause is a guarantee against any actuation of that sort. It stands for
fairness and justice. That standard was not ignored. It suffices to read the petition to disprove any
allegation of such failing, whether in its procedural or substantive aspect Petitioner was heard by
respondent Bureau before the order of decertification was issued on April 8, 1975. The denial of its motion
for reconsideration came also after it had an opportunity to present it side. Procedural due process was
thus observed. Nor was there any denial of substantive due process in the sense of such decertification
being an act of arbitrariness and caprice. In the order of April 8, 1975, it was specifically pointed out: In
the instant case, it is not disputed that the collective bargaining agreement certified by the NLRC was not
ratified by the majority of the employees within the bargaining unit. This is defective. It is blatant nonobservance of the basic requirement necessary to certification. To allow it to remain uncorrected would
allow circumvention of what the law specifically ordained x x x.
Same; The findings of the National Labor Relations Commission on factual matters is generally binding
on the courts.There is no need for a citation of authorities to show how well-settled and firmly-rooted is

the doctrine of the well-high conclusive respect for the findings of facts of administrative tribunals,
leaving to the judiciary, in the ultimate analysis, this Tribunal, to set forth the correct legal norm
applicable to the controversy. With specific reference to the agencies at present dealing with labor
relations, there is this excerpt from Justice Aquinos opinion in Antipolo Highway Lines, Inc. v. Inciong:
x x x We found no justification for setting aside the factual findings of the NLRC, which like those of
any other administrative agency, are generally binding on the courts. [Philippine Labor Alliance Council
(PLAC) vs. Bureau of Labor Relations, 75 SCRA 162(1977)]
Alliance of Nationalist and Genuine Labor Org. vs. Samahan ng mga Manggagawang Nagkakaisa
sa Manila Bay Spinning Mills, 258 SCRA 371(1996)
Labor Law; Constitutional Law; Right to Self-Organization; All employees enjoy the right to selforganization and to form and join labor organizations of their own choosing for the purpose of collective
bargaining.Anent the first ground, we reiterate the rule that all employees enjoy the right to selforganization and to form and join labor organizations of their own choosing for the purpose of collective
bargaining. This is a fundamental right of labor and derives its existence from the Constitution. In
interpreting the protection to labor and social justice provisions of the Constitution and the labor laws,
rights.
Same; Same; Same; Right to Disaffiliation; Non-compliance with the procedure on disaffiliation, being
premised on purely technical grounds cannot rise above the fundamental right of self-organization.This
Court is not ready to bend this principle to yield to a mere procedural defect, to wit: failure to observe
certain procedural requirements for a valid disaffiliation. Non-compliance with the procedure on
disaffiliation, being premised on purely technical grounds cannot rise above the fundamental right of selforganization.
Same; Same; Same; Even before the onset of the freedom period, disaffiliation may be carried out when
there is a shift of allegiance on the part of the majority of the members of the union.Although P.D. 1391
provides: Item No. 6. No petition for certification election, for intervention and disaffiliation shall be
entertained or given due course except within the 60-day freedom period immediately preceeding the
expiration of a collective bargaining agreement, said law is definitely not without exceptions. Settled is
the rule that a local union has the right to disaffiliate from its mother union when circumstances warrant.
Generally, a labor union may disaffiliate from the mother union to form a local or independent union only
during the 60-day freedom period immediately preceding the expiration of the CBA. However, even
before the onset of the freedom period, disaffiliation may be carried out when there is a shift of allegiance
on the part of the majority of the members of the union.
Same; Same; Same; The mere act of affiliation does not divest the local union of its own personality,
rise to a contract of agency, where the former acts in representation of the latter.A local labor union is a
separate and distinct unit primarily designed to secure and maintain an equality of bargaining power
between the employer and their employee-members. A local union does not owe its existence to the
federation with which it is affiliated. It is a separate and distinct voluntary association owing its creation to
the will of its members. The mere act of affiliation does not divest the local union of its own personality,
rise to a contract of agency where the former acts in representation of the latter.
Same; Same; Same.By SAMANA BAYs disaffiliation from ANGLO, the vinculum that previously
bound the two entities was completely severed. ANGLO was divested of any and all power to act in
Jose D. Dula II
Atty. Gutierrez
representation of SAMANA BAY. Thus, any act performed by ANGLO affecting the interests and affairs
of SAMANA BAY, including the ouster of herein individual private respondents, is rendered without force
and effect. [Alliance of Nationalist and Genuine Labor Org. vs. Samahan ng mga Manggagawang
Nagkakaisa sa Manila Bay Spinning Mills, 258 SCRA 371(1996)]

Part Four
Jose D. Dula II
Atty. Gutierrez
unit, more so when there is no existing collective bargaining agreement and there has not been a
certification election in the com-pany for the past three years and as in the instant case.
Belyca Corporation vs. Ferrer-Calleja, 168 SCRA 184(1988)

Labor Law; Collective Bargaining Unit; Factors considered by the Court in determining the proper
constituency of a collective bargaining unit.This Court has already taken cognizance of the crucial issue
of determining the proper constituency of a collective bargaining unit. Among the factors considered in
Democratic Labor Association v. Cebu Stevedoring Co. Inc. (103 Phil. 1103 [1958]) are: (1) will of
employees (Glove Doctrine); (2) afinity and unity of employees interest, such as substantial similarity of
work and duties or similarity of compensation and working conditions; (3) prior collective bargaining
history; and (4) employment status, such as temporary, seasonal and probationary employees.
Same; Same; Same; In the case of Democratic Labor Association v. Cebu Stevedoring Co. Inc., the Court
laid down the test of proper grouping which is community and mutuality of interest.Under the
circumstance of that case, the Court stressed the importance of the fourth factor and sustained the trial
courts conclusion that two separate bargaining units should be formed in dealing with respondent
company, one consisting of regular and permanent employees and another consisting of casual laborers or
stevedores. Otherwise stated, temporary employees should be treated separately from permanent
employees. But more importantly, this Court laid down the test of proper grouping, which is community
and mutuality of interest.
Same; Same; Same; Same; The basic test of an asserted bargaining units acceptability is whether or not it
is fundamentally the combination which will best assure to all employees the exercise of their collective
bargaining rights.In any event, whether importance is focused on the employment status or the
mutuality of interest of the employees concerned the basic test of an asserted bargaining units
acceptability is whether or not it is fundamentally the combination which will best assure to all employees
the exercise of their collective bargaining rights.
Same; Same; Same; Same; Same; All the employees of petitioner in its integrated business concerns
cannot result in an efficacious bargaining unit comprised of constituents enjoying a community or
mutuality of interest.Coming back to the case at bar, it is beyond question that the employees of the
livestock and agro division of petitioner corporation perform work entirely different from those performed
by employees in the supermarts and cinema. Among others, the noted difference are: their working
conditions, hours of work, rates of pay, including the categories of their positions and employment status.
As stated by petitioner corporation in its position paper, due to the nature of the business in which its
livestock-agro division is engaged very few of its employees in the division are permanent, the
overwhelming majority of which are seasonal and casual and not regular employees (Rollo, p. 26).
Definitely, they have very little in common with the employees of the supermarts and cinemas. To lump
all the employees of petitioner in its integrated business concerns cannot result in an efficacious
bargaining unit comprised of constituents enjoying a community or mutuality of interest. Undeniably, the
rank and file employees of the livestock-agro division fully constitute a bargaining unit that satisfies both
requirements of classification according to employment status and of the substantial similarity of work
and duties which will ultimately assure its members the exercise of their collective bargaining rights.
Same; Same; Certification Election; Once the statutory requirement is met, the Director of Labor
Relations has no choice but to call a certification election.Under Art. 257 of the Labor Code once the
statutory requirement is met, the Director of Labor Relations has no choice but to call a certification
election. It becomes in the language of the New Labor Code Mandatory for the Bureau to conduct a
certification election for the purpose of determining the representative of the employees in the appropriate
bargaining unit and certify the winner as the exclusive bargaining representative of all employees in the
Same; Same; Same; Same; Any doubt cast on the authenticity of signature to the petition for holding a
certification election cannot be a bar to its being granted.It is significant to note that 124 employees out
of the 205 employees of the Belyca Corporation have expressed their written consent to the certification
election or more than a majority of the rank and file employees and workers; much more than the required
30% and over and above the present requirement of 20% by Executive Order No. 111 issued on December
24, 1980 and applicable only to unorganized establishments under Art. 257, of the Labor Code, to which
the BELYCA Corporation belongs (Ass. Trade Unions (ATU) v. Trajano G.R. No. 75321, June 20, 1988).
More than that, any doubt cast on the authenticity of signatures to the petition for holding a certification
election cannot be a bar to its being granted (Filipino Metals Corp. v. Ople 107 SCRA 211 [1981]). Even
doubts as to the required 30% being met warrant holding of the certification election (PLUM Federation
of Industrial and Agrarian Workers v. Noriel 119 SCRA [1982]). In fact, once the required percentage
requirement has been reached, the employees withdrawal from union membership taking place after the
filing of the petition for certification election will not affect said petition.
Same; Same; Same; Same; Same; The holding of a certification election is a statutory policy that should
not be circumvented.On the contrary, the presumption arises that the withdrawal was not free but was
procured through duress, coercion or for a valuable consideration (La Suerte Cigar and Cigarette Factory
v. Director of the Bureau of Labor Relations 123 SCRA 679 [1983]). Hence, the subsequent disaffiliation
of the six (6) employees from the union will not be counted against or deducted from the previous number
who had signed up for certification elections (Vicmico Industrial Workers Association (VIWA) v. Noriel
131 SCRA 569 [1984]). Similarly, until a decision, final in character, has been issued declaring the strike
illegal and the mass dismissal or retrenchment valid, the strikers cannot be denied participation in the
certification elections notwithstanding, the vigorous condemnation of the strike and the fact that the
picketing were attended by violence. Under the foregoing circumstances, it does not necessarily follow
that the strikers in question are no longer entitled to participate in the certification election on the theory
that they have automatically lost their jobs. (Barrera v. CIR, 107 SCRA 596 [1981]). For obvious reasons,
the duty of the employer to bargain collectively is nullified if the purpose of the dismissal of the union
members is to defeat the union in the consent requirement for certification election. (Samahang
Manggagawa ng Via Mare v. Noriel 98 SCRA 507 [1980]). As stressed by this Court, the holding of a
certification election is a statutory policy that should not be circumvented.
Same; Same; Same; Same; Same; Same; A certification election is the sole concern of the workers;
Exception.As a general rule, a certification election is the sole concern of the workers. The only
exception is where the employer has to file a petition for certification election pursuant to Art. 259 of the
Labor Code because the latter was requested to bargain collectively. But thereafter the role of the
employer in the certification process ceases. The employer becomes merely a bystander.
Same; Same; Same; Same; Same; Same; Same; No showing that the instant case falls under the exception.
There is no showing that the instant case falls under the above mentioned exception. However, it will be
noted that petitioner corporation from the outset has actively participated and consistently taken the
position of adversary in the petition for direct certification as the sole and exclusive bargaining
representative and/or certification election filed by respondent Associated Labors Unions (ALU)-TUCP to
the extent of filing this petition for certiorari in this Court. Considering that a petition for certification
election is not a litigation but a mere investigation of a non-adversary character to determining the
bargaining unit to represent the employees and its only purpose is to give the employees true
representation in their collective bargaining with an employer, there appears to be no reason for the

employers objection to the formation of subject union, much less for the filing of the petition for a
certification election. [Belyca Corporation vs. Ferrer-Calleja, 168 SCRA 184(1988)]
Jose D. Dula II
Atty. Gutierrez
contracts, collective bargaining agreements included, must yield to the common good. Should such
contracts contain stipulations that are contrary to public policy, courts will not hesitate to strike down
these stipulations. [International School Alliance of Educators vs. Quisumbing, 333 SCRA 13(2000)]
International School Alliance of Educators vs. Quisumbing, 333 SCRA 13(2000)

Labor Law; Constitutional Law; That public policy abhors inequality and discrimination is beyond
contention.That public policy abhors inequality and discrimination is beyond contention. Our
Constitution and laws reflect the policy against these evils. The Constitution in the Article on Social
Justice and Human Rights exhorts Congress to give highest priority to the enactment of measures that
protect and enhance the right of all people to human dignity, reduce social, economic, and political
inequalities. The very broad Article 19 of the Civil Code requires every person, in the exercise of his
rights and in the performance of his duties, [to] act with justice, give everyone his due, and observe
honesty and good faith.
Same; Same; International law, which springs from general principles of law, likewise proscribes
discrimination.International law, which springs from general principles of law, likewise proscribes
discrimination. General principles of law include principles of equity, i.e., the general principles of
fairness and justice, based on the test of what is reasonable. The Universal Declaration of Human Rights,
the International Covenant on Economic, Social, and Cultural Rights, the International Convention on the
Elimination of All Forms of Racial Discrimination, the Convention against Discrimination in Education,
the Convention (No. 111) Concerning Discrimination in Respect of Employment and Occupationall
embody the general principle against discrimination, the very antithesis of fairness and justice. The
Philippines, through its Constitution, has incorporated this principle as part of its national laws.
Same; Same; State directed to promote equality of employment opportunities for all.The Constitution
also directs the State to promote equality of employment opportunities for all. Similarly, the Labor Code
provides that the State shall ensure equal work opportunities regardless of sex, race or creed. It would be
an affront to both the spirit and letter of these provisions if the State, in spite of its primordial obligation to
promote and ensure equal employment opportunities, closes its eyes to unequal and discriminatory terms
and conditions of employment.
Same; Same; Discrimination, particularly in terms of wages, is frowned upon by the Labor Code.
Discrimination, particularly in terms of wages, is frowned upon by the Labor Code. Article 135, for
example, prohibits and penalizes the payment of lesser compensation to a female employee as against a
male employee for work of equal value. Article 248 declares it an unfair labor practice for an employer to
discriminate in regard to wages in order to encourage or discourage membership in any labor organization.
Same; Same; If an employer accords employees the same position and rank, the presumption is that these
employees perform equal work.The School contends that petitioner has not adduced evidence that localhires perform work equal to that of foreign-hires. The Court finds this argument a little cavalier. If an
employer accords employees the same position and rank, the presumption is that these employees perform
equal work. This presumption is borne by logic and human experience. If the employer pays one
employee less than the rest, it is not for that employee to explain why he receives less or why the others
receive more. That would be adding insult to injury. The employer has discriminated against that
employee; it is for the employer to explain why the employee is treated unfairly.
Same; Same; The State has the right and duty to regulate the relations between labor and capital.The
Constitution enjoins the State to protect the rights of workers and promote their welfare, to afford labor
full protection. The State, therefore, has the right and duty to regulate the relations between labor and
capital. These relations are not merely contractual but are so impressed with public interest that labor
Sta. Lucia East Commercial Corporation vs. Secretary of Labor and Employment, 596 SCRA
92(2009)
Labor Law; Collective Bargaining; Labor Unions; Words and Phrases; Article 212(g) of the Labor Code
defines a labor organization as any union or association of employees which exists in whole or in part for
the purpose of collective bargaining or of dealing with employers concerning terms and conditions of
employment; Any applicant labor organization shall acquire legal personality and shall be entitled to the
rights and privileges granted by law to legitimate labor organizations upon issuance of the certificate of
registration.Article 212(g) of the Labor Code defines a labor organization as any union or association
of employees which exists in whole or in part for the purpose of collective bargaining or of dealing with
employers concerning terms and conditions of employment. Upon compliance with all the documentary
requirements, the Regional Office or Bureau shall issue in favor of the applicant labor organization a
certificate indicating that it is included in the roster of legitimate labor organizations. Any applicant labor
organization shall acquire legal personality and shall be entitled to the rights and privileges granted by law
to legitimate labor organizations upon issuance of the certificate of registration.
Same; Same; Same; Same; The concepts of a union and of a legitimate labor organization are different
from, but related to, the concept of a bargaining unit; A bargaining unit is a group of employees of a
given employer, comprised of all or less than all of the entire body of employees, consistent with equity to
the employer, indicated to be the best suited to serve the reciprocal rights and duties of the parties under
the collective bargaining provisions of the law; Employees in two corporations cannot be treated as a
single bargaining unit even if the businesses of the two corporations are related.
The concepts of a union and of a legitimate labor organization are different from, but related to, the
concept of a bargaining unit. We explained the concept of a bargaining unit in San Miguel Corporation v.
Laguesma (236 SCRA 595 [1994]), where we stated that: A bargaining unit is a group of employees of a
given employer, comprised of all or less than all of the entire body of employees, consistent with equity to
the employer, indicated to be the best suited to serve the reciprocal rights and duties of the parties under
the collective bargaining provisions of the law. The fundamental factors in determining the appropriate
collective bargaining unit are: (1) the will of the employees (Globe Doctrine); (2) affinity and unity of the
employees interest, such as substantial similarity of work and duties, or similarity of compensation and
working conditions (Substantial Mutual Interests Rule); (3) prior collective bargaining history; and (4)
similarity of employment status. Contrary to petitioners assertion, this Court has categorically ruled that
the existence of a prior collective bargaining history is neither decisive nor conclusive in the determination
of what constitutes an appropriate bargaining unit. However, employees in two corporations cannot be
treated as a single bargaining unit even if the businesses of the two corporations are related.
Same; Same; Same; The inclusion in the union of disqualified employees is not among the grounds for
cancellation of registration, unless such inclusion is due to misrepresentation, false statement or fraud
under the circumstances enumerated in Sections (a) to (c) of Article 239 of the Labor Code, and the proper
procedure is for the employer to file a petition for cancellation of certificate of registration of such union
and not to immediately commence voluntary recognition proceedings with another labor organization.
The inclusion in the union of disqualified employees is not among the grounds for cancellation of
registration, unless such inclusion is due to misrepresentation, false statement or fraud under the
circumstances enumerated in Sections (a) to (c) of Article 239 of the Labor Code. Thus, CLUP-SLECC
and its Affiliates Workers Union, having been validly issued a certificate of registration, should be

considered as having acquired juridical personality which may not be attacked collaterally. The proper
procedure for SLECC is to file a petition for cancellation of certificate of registration of CLUP-SLECC
and its Affiliates Workers Union and not to immediately commence voluntary recognition proceedings
with SMSLEC.
Same; Same; Same; The employer may voluntarily recognize the representation status of a union in
unorganized establishments.The employer may voluntarily recognize the representation status of a
union in unorganized establishments. SLECC was not an unorganized establishment when it voluntarily
recognized SMSLEC as its exclusive bargaining representative on 20 July 2001. CLUP-SLECC and its
Affiliates Workers Union filed a petition for certification election on 27 February 2001 and this petition
remained pending as of 20 July 2001. Thus, SLECCs voluntary recognition of SMSLEC on 20 July 2001,
the subsequent negotiations and resulting registration of a CBA executed by SLECC and SMSLEC are
void and cannot bar CLUP-SLECCWAs present petition for certification election.
Same; Same; Same; Certification Elections; In petitions for
certification election, the employer is a mere bystander and cannot oppose the petition or appeal the MedArbiters decision; Exception.We find it strange that the employer itself, SLECC, filed a motion to
oppose CLUP-SLECCWAs petition for certification election. In petitions for certification election, the
employer is a mere bystander and cannot oppose the petition or appeal the Med-Arbiters decision. The
exception to this rule, which happens when the employer is requested to bargain collectively, is not present
in the case before us. [Sta. Lucia East Commercial Corporation vs. Secretary of Labor and Employment,
596 SCRA 92(2009)]
University of the Philippines vs. Ferrer-Calleja, 211 SCRA 451(1992)
Labor Laws; Labor Organization; Professors, associate professors and assistant professors cannot be
considered as exercising such managerial or highly confidential functions as would justify their being
categorized as high-level employees of the University of the Philippines.As regards the first issue, the
Court is satisfied that it has been correctly resolved by the respondent Director of Bureau Relations. In
light of Executive Order No. 180 and its implementing rules, as well as the Universitys charter and
relevant regulations, the professors, associate professors and assistant professors (hereafter simply referred
to as professors) cannot be considered as exercising such managerial or highly confidential functions as
would justify their being categorized as high-level employees of the institution.
Same; Same; Same; It is the University Academic Personnel Committee composed of deans, the assistant
for academic affairs and the chief of personnel which formulates the policies, rules and standards
respecting selection, compensation and promotion of members of the academic staff.From the
foregoing, it is evident that it is the University Academic Personnel Committee, composed of deans, the
assistant for academic affairs and the chief of personnel, which formulates the policies, rules and standards
respecting selection, compensation and promotion of members of the academic staff. The departmental
and college academic personnel committees functions are purely recommendatory in nature, subject to
review and evaluation by the University Academic Personnel Board.
Jose D. Dula II
Atty. Gutierrez
employees within the context of E.O. 180.Even assuming arguendo that UP professors discharge policydetermining functions through the University Council, still such exercise would not qualify them as highlevel employees within the context of E.O. 180. As correctly observed by private respondent, Executive
Order No. 180 is a law concerning public sector unionism. It must therefore be construed within that
context. Within that context, the University of the Philippines represents the government as an employer.
Policy-determining refers to policy-determination in university matters that affect those same matters
that may be the subject of negotiation between public sector management and labor. The reason why
policy-determining has been laid down as a test in segregating rank-and-file from management is to
ensure that those who lay down policies in areas that are still negotiable in public sector collective
bargaining do not themselves become part of those employees who seek to change these policies for their
collective welfare.
Same; Same; Bargaining Unit defined.A bargaining unit has been defined as a group of employees of
a given employer, comprised of all or less than all of the entire body of employees, which the collective
interest of all the employees, consistent with equity to the employer, indicate to be the best suited to serve
the reciprocal rights and duties of the parties under the collective bargaining provisions of the law.
Same; Same; Same; Our labor laws do not provide the criteria for determining the proper collective
bargaining unit.Our labor laws do not however provide the criteria for determining the proper collective
bargaining unit.
Same; Same; Same; Same; The basic test of an asserted bargaining units acceptability is whether or not it
is fundamentally the combination which will best assure to all employees the exercise of their collective
bargaining rights.The Court further explained that (t)he test of the grouping is community or mutuality
of interests. And this is so because the basic test of an asserted bargaining units acceptability is whether
or not it is fundamentally the combination which will best assure to all employees the exercise of their
collective bargaining rights (Rothenberg on Labor Relations, 490). Hence, in that case, the Court upheld
the trial courts conclusion that two separate bargaining units should be formed, one consisting of regular
and permanent employees and another consisting of casual laborers or stevedores.
Same; Same; Same; Same; Same; The community or mutuality of interests test has provided the standard
in determining the proper constituency of a collective bargaining unit.Since then, the community or
mutuality of interests test has provided the standard in determining the proper constituency of a collective
bargaining unit. In Alhambra Cigar & Cigarette Manufacturing Company, et al. vs. Alhambra Employees
Association (PAFLU), 107 Phil. 23, the Court, noting that the employees in the administrative, sales and
dispensary departments of a cigar and cigarette manufacturing firm perform work which have nothing to
do with production and maintenance, unlike those in the raw lead (malalasi), cigar, cigarette, packing
(precintera) and engineering and garage departments, authorized the formation of the former set of
employees into a separate collective bargaining unit. The ruling in the Democratic Labor Association case,
supra, was reiterated in Philippine Land-Air-Sea Labor Union vs. Court of Industrial Relations, 110 Phil.
176, where casual employees were barred from joining the union of the permanent and regular employees.
[University of the Philippines vs. Ferrer-Calleja, 211 SCRA 451(1992)]
San Miguel Corporation vs. Laguesma, 236 SCRA 595(1994)
Same; Same; Same; Membership in the University Council can not elevate the professors to the status of
high-level employees.Neither can membership in the University Council elevate the professors to the
status of high-level employees.
Same; Same; Same; Same; Even assuming arguendo that UP professors discharge policy-determining
functions through the University Council, still such exercise would not qualify them as high-level
Labor Law; Bargaining Unit, defined.A bargaining unit is a group of employees of a given employer,
comprised of all or less than all of the entire body of employees, consistent with equity to the employer,
indicate to be the best suited to serve the reciprocal rights and duties of the parties under the collective
bargaining provisions of the law.

Same; Same; Factor in determining collective bargaining units.The fundamental factors in determining
the appropriate collective bargaining unit are: (1) the will of the employees (Globe Doctrine); (2) affinity
and unity of the employees interest, such as substantial similarity of work and duties, or similarity or
compensation and working conditions (Substantial Mutual Interests Rule); (3) prior collective bargaining
history; and (4) similarity of employment status.
Same; Same; The collective bargaining history of a company is not decisive of what should comprise the
collective bargaining unit.Contrary to petitioners assertion, this Court has categorically ruled that the
existence of a prior collective bargaining history is neither decisive nor conclusive in the determination of
what constitutes an appropriate bargaining unit.
Same; Same; Employees sought to be represented by the collective bargaining agent must have substantial
mutual interest.In-deed, the test of grouping is mutuality or commonality of interests. The employees
sought to be represented by the collective bargaining agent must have substantial mutual interests in terms
of employment and working conditions as evinced by the type of work they perform.
Lawyers; Client-Lawyer Relationship; A client is bound by the mistakes of his counsel. Only when it
would result in serious injustice should an exception thereto be called for.As discussed earlier, the
collective bargaining history of a company is not decisive of what should comprise the collective
bargaining unit. Insofar as the alleged mistake of the substitute lawyer is concerned, we find that this
mistake was the direct result of the negligence of petitioners lawyers. It will be noted that Atty. Ona was
under the supervision of two (2) other lawyers, Attys. Jacinto de la Rosa, Jr. and George C. Nograles.
There is nothing in the records to show that these two (2) counsels were likewise unavailable at that time.
Instead of deferring the hearing, petitioners counsels chose to proceed therewith. Indeed, prudence
dictates that, in such case, the lawyers allegedly actively involved in SMCs labor case should have
adequately and sufficiently briefed the substitute lawyer with respect to the matters involved in the case
and the specific limits of his authority. Unfortunately, this was not done in this case. The negligence of its
lawyers binds petitioner. As held by this Court in the case of Villa Rhecar Bus v. De la Cruz: x x x As a
general rule, a client is bound by the mistakes of his counsel. Only when the application of the general rule
would result in serious injustice should an exception thereto be called for.
Labor Law; Collective Bargaining Agreement; It is not the convenience of the employer that constitutes
the determinative factor in forming an appropriate bargaining unit.In the case at bench, petitioner insists
that each of the sales offices in northern Luzon should be considered as a separate bargaining unit for
negotiations would be more expeditious. Petitioner obviously chooses to follow the path of least
resistance. It is not, however, the convenience of the employer that constitutes the determinative factor in
forming an appropriate bargaining unit. Equally, if not more important, is the interest of the employees. In
choosing and crafting an appropriate bargaining unit, extreme care should be taken to prevent an employer
from having any undue advantage over the employees bargaining representative. Our workers are weak
enough and it is not our social policy to further debilitate their bargaining representative. [San Miguel
Corporation vs. Laguesma, 236 SCRA 595(1994)]
Indophil Textile Mill Workers Union vs. Calica, 205 SCRA 697(1992)
Labor Law; Evidence; Rule that decisions of voluntary arbitrators are to be given the highest respect and a
certain measure of finality is not a hard and fast rule.Time and again, We stress that the decisions of
voluntary arbitrators are to be given the highest respect and a certain measure of finality, but this is not a
hard and fast rule, it does not preclude judicial review thereof where want of jurisdiction, grave abuse of
discretion, violation of due process, denial of substantial justice, or erroneous interpretation of the law
were brought to our attention.
Jose D. Dula II
Atty. Gutierrez
Corporation Law; Doctrine of piercing the veil of corporate entity applies when the corporate fiction is
used to defeat public convenience, justify wrong, protect fraud or defend crime or where a corporation is
the mere alter ego or business conduit of a person.Under the doctrine of piercing the veil of corporate
entity, when valid grounds therefore exist, the legal fiction that a corporation is an entity with a juridical
personality separate and distinct from its members or stockholders may be disregarded. In such cases, the
corporation will be considered as a mere association of persons. The members or stockholders of the
corporation will be considered as the corporation, that is liability will attach directly to the officers and
stockholders. The doctrine applies when the corporate fiction is used to defeat public convenience, justify
wrong, protect fraud, or defend crime, or when it is made as a shield to confuse the legitimate issues, or
where a corporation is the mere alter ego or business conduit of a person, or where the corporation is so
organized and controlled and its affairs are so conducted as to make it merely an instrumentality, agency,
conduit or adjunct of another corporation.
Same; Same; Fact that the businesses of private respondent and Acrylic are related, that some of the
employees of the private respondent are the same persons manning and providing for auxilliary services to
the units of Acrylic and that the physical plants, offices and facilities are situated in the same compound
are not sufficient to justify the piercing of the corporate veil of Acrylic.In the case at bar, petitioner
seeks to pierce the veil of corporate entity of Acrylic, alleging that the creation of the corporation is a
devise to evade the application of the CBA between petitioner Union and private respondent Company.
While we do not discount the possibility of the similarities of the businesses of private respondent and
Acrylic, neither are we inclined to apply the doctrine invoked by petitioner in granting the relief sought.
The fact that the businesses of private respondent and Acrylic are related, that some of the employees of
the private respondent are the same persons manning and providing for auxilliary services to the units of
Acrylic, and that the physical plants, offices and facilities are situated in the same compound, it is our
considered opinion that these facts are not sufficient to justify the piercing of the corporate veil of Acrylic.
Same; Same; The legal corporate entity is disregarded only if it is sought to hold the officers and
stockholders directly liable for a corporate debt or obligation.In the same case of Umali, et al. v. Court
of Appeals (supra), We already emphasized that "the legal corporate entity is disregarded only if it is
sought to hold the officers and stockholders directly liable for a corporate debt or obligation." In the
instant case petitioner does not seek to impose a claim against the members of the Acrylic.
Same; Same; Same; It is grave abuse of discretion to treat two companies as a single bargaining unit when
these companies are indubitably distinct entities with separate juridical personalities.Furthermore, We
already ruled in the case of Diatagon Labor Federation Local 110 of the ULGWP v. Ople (supra) that it is
grave abuse of discretion to treat two companies as a single bargaining unit when these companies are
indubitably distinct entities with separate juridical personalities. [Indophil Textile Mill Workers Union vs.
Calica, 205 SCRA 697(1992)]
Golden Farms, Inc. vs. Secretary of Labor, 234 SCRA 517(1994)]
Labor Law; Right to Self-organization; The monthly paid office and technical rank-and-file employees of
petitioner Golden Farms enjoy the constitutional right to self-organization and collective bargaining;
Definition of a bargaining unit.The monthly paid office and technical rank-and-file employees of
petitioner Golden Farms enjoy the constitutional right to self-organization and collective bargaining. A
bargaining unit has been defined as a group of employees of a given employer, comprised of all or less
than all of the entire body of employees, which the collective interest of all the employees, consistent with
equity to the employer, indicate to be the best suited to serve the reciprocal rights and duties of the parties
under the collective bargaining provisions of the law.

Same; Same; Same; To rule otherwise would deny this distinct class of employees the right to selforganization for purposes of collective bargaining.To be sure, the said monthly paid rank-and-file
employees have even been excluded from the bargaining unit of the daily paid rank-and-file employees.
This dissimilarity of interests warrants the formation of a separate and distinct bargaining unit for the
monthly paid rank-and-file employees of the petitioner. To rule otherwise would deny this distinct class of
employees the right to self-organization for purposes of collective bargaining. Without the shield of an
organization, it will also expose them to the exploitations of management.
Same; Same; Managerial employees, definition of.Article 212, paragraph (m) of the Labor Code, as
amended, defines a managerial employee as follows: Managerial employee is one who is vested with
power 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.
Same; Same; Same; The monthly paid office and technical employees, accountants and cashiers of the
petitioner are not managerial employees.Given this definition, the monthly paid office and technical
employees, accountants, and cashiers of the petitioner are not managerial employees for they do not
participate in policy-making but are given cut out policies to execute and standard practices to observe. In
the main, the discharge of their duties does not involve the use of independent judgment.
Same; Same; The decision in Golden Farms Inc. vs. Honorable Pura Ferrer-Calleja does not pose any
obstacle in holding a certification election among petitioners monthly paid rank and file employees;
Principle of res judicata is inapplicable.Our decision in Golden Farms, Inc. vs. Honorable Pura FerrerCalleja, op. cit., does not pose any obstacle in holding a certification election among petitioners monthly
paid rank-and-file employees. The issue brought to fore in that case was totally different, i.e., whether or
not petitioners confidential employees, considering the nature of their work, should be included in the
bargaining unit of the daily paid rank-and-file employees. In the case at bench, the monthly paid rank-andfile employees of petitioner are being separated as a bargaining unit from its daily paid rank-and-file
employees, on the ground that they have different interest to protect. The principle of res judicata is,
therefore, inapplicable.
Same; Same; The general rule is that an employee has no standing to question a certification election since
this is the sole concern of the workers.Finally, we note that it was petitioner company that filed the
motion to dismiss the petition for election. The general rule is that employer has no standing to question a
certification election since this is the sole concern of the workers. Law and policy demand that em-ployers
take a strict, hands-off stance in certification elections. The bargaining representative of employees should
be chosen free from any extraneous influence of management. A labor bargaining representative, to be
effective, must owe its loyalty to the employees alone and to no other. [Golden Farms, Inc. vs. Secretary
of Labor, 234 SCRA 517(1994)]
San Miguel Corp. Supervisors and Exempt Employees Union vs. Laguema, 277 SCRA 370(1997)]
Jose D. Dula II
Atty. Gutierrez
Labor Law; Labor Unions; Criteria to Determine who are Confidential Employees.Confidential
employees are those who (1) assist or act in a confidential capacity, (2) to persons who formulate,
determine, and effectuate management policies in the field of labor relations. The two criteria are
cumulative, and both must be met if an employee is to be considered a confidential employeethat is, the
confidential relationship must exist between the employee and his supervisor, and the supervisor must
handle the prescribed responsibilities relating to labor relations.
Same; Same; Reason behind the confidential employee rule.The exclusion from bargaining units of
employees who, in the normal course of their duties, become aware of management policies relating to
labor relations is a principal objective sought to be accomplished by the confidential employee rule. The
broad rationale behind this rule is that employees should not be placed in a position involving a potential
conflict of interests. Management should not be required to handle labor relations matters through
employees who are represented by the union with which the company is required to deal and who in the
normal performance of their duties may obtain advance information of the companys position with regard
to contract negotiations, the disposition of grievances, or other labor relations matters.
Same; Same; Same; In determining the confidentiality of certain employees, a key question frequently
considered is the employees necessary access to confidential labor relations information.An important
element of the confidential employee rule is the employees need to use labor relations information.
Thus, in determining the confidentiality of certain employees, a key question frequently considered is the
employees necessary access to confidential labor relations information.
Same; Same; Same; An employee may not be excluded from appropriate bargaining unit merely because
he has access to confidential information concerning employers internal business operations and which is
not related to the field of labor relations.It is evident that whatever confidential data the questioned
employees may handle will have to relate to their functions. From the foregoing functions, it can be
gleaned that the confidential information said employees have access to concern the employers internal
business operations. As held in Westinghouse Electric Corporation v. National Labor Relations Board, an
employee may not be excluded from appropriate bargaining unit merely because he has access to
confidential information concerning employers internal business operations and which is not related to
the field of labor relations.
Same; Same; Same; Confidential employees who may be excluded from bargaining unit must be strictly
defined so as not to needlessly deprive many employees of their right to bargain collectively through
representatives of their choosing.It must be borne in mind that Section 3 of Article XIII of the 1987
Constitution mandates the State to guarantee to all workers the right to self-organization. Hence,
confidential employees who may be excluded from bargaining unit must be strictly defined so as not to
needlessly deprive many employees of their right to bargain collectively through representatives of their
choosing.
Same; Same; Appropriate Bargaining Unit Defined.An appropriate bargaining unit may be defined as a
group of employees of a given employer, comprised of all or less than all of the entire body of employees,
which the collective interest of all the employees, consistent with equity to the employer, indicate to be
best suited to serve the reciprocal rights and duties of the parties under the collective bargaining
provisions of the law. [San Miguel Corp. Supervisors and Exempt Employees Union vs. Laguema, 277
SCRA 370(1997)]
Mechanical Dept. Labor Union sa Phil. NaVL Railways vs. Court of Industrial Relations, 24 SCRA
925(1968) GLOBE DOCTRINE

Labor law; Labor union; Formation and separation of bargaining unit; Globe doctrine; Case at bar.
Under the Globe doctrine (Globe Machine &' Stamping Co., 3 NLRB 294, applied in Democratic Labor
Union v. Cebu Stevedoring Co., L10321, Feb. 28, 1958), bargaining units may be formed through
separation of new units from existing ones whenever plebiscites had shown the workers' desire to have
their own representatives. In the case at bar, the appeal of the Mechanical Department Labor Union,
questioning the applicability under the circumstances of the Globe doctrine of considering the will of the
employees in determining what union should represent them, is premature, since the result of the ordered
plebiscite among the workers of the Caloocan shops (who desire to form a new bargaining unit) may be
adverse to the formation of a separate unit, in which event, all questions raised in the appealed case would
be rendered moot and academic.
Appellant contends that the application of the "Globe'flbctrine" is not warranted because the workers of
the Caloocan shops do not require different skills from the rest of the workers in the Mechanical
Department of the Railway Company.
This question is primarily one of fact. The Industrial Court has found that there is a basic difference, in
that those in the Caloocan shops not only have a community of interest and working conditions but
perform major repairs of railway rolling stock, using; heavy equipment and machineries found in said
shops, while the others only perform minor repairs. It is easy to understand, therefore, that the workers in
the Caloocan shops require special skill in the use of heavy equipment and machinery sufficient to set
them apart from the rest of the workers. In addition, the record shows that the collective bargaining
agreements negotiated by the appellant union have been in existence for more than two (2) years; hence,
such agreements can not constitute a bar to the determination, by proper elections, of a new bargaining
representative (PLDT Employees' Union v. Philippine Long Distance Telephone Co., 51 Off. Gaz., 4519).
Same; Court of Industrial Relations; Grant to Court of Iqdustrial Relations of discretion in matters
concerning the determination of representation of employee groups; Reason therefor.Republic Act No.
875 has primarily entrusted the pros-ecution of its policies to the Court of Industrial Relations, and, in
view of its intimate knowledge concerning the facts and circumstances surrounding the cases brought
before it, this Court has repeatedly upheld the exercise of discretion of the Court of Industrial Relations in
matters concerning the representation of employee groups (Manila Paper Mills Employees & Workers'
Association v. C.I.R., 104 Phil. 10; Benguet Consolidated v. Bobok Lumber Jack Association, 103 Phil.
1150). [Mechanical Dept. Labor Union sa Phil. NaVL Railways vs. Court of Industrial Relations, 24
SCRA 925(1968)]
Filoil Refinery Corporation vs. Filoil Supervisory & Confidential Employees Association, 46 SCRA
512(1972)]
Labor law; Right of supervisors to form a union.Section 3 of the Industrial Peace Act explicitly
provides that employeesand this term includes supervisorsshall have the right to self-organization,
and to form, join or assist labor organizations of their own choosing for the purpose of collective
bargaining... and that individuals employed as supervisors... may form separate organizations of their
own. Indeed, it is well settled that in relation to his employer, a foreman or supervisor is an employee
within the meaning of the Act. For this reason, supervisors are entitled to engage in union activities and
any discrimination against them by reason thereof constitutes an unfair labor practice. (AG & P Co. of
Manila vs. C.I.R., 3 SCRA 672 [1961]).
Same; Same.Supervisors and confidential employees, even though they may exercise the prerogatives
of management as regards the rank and file employees are indeed employees in relation to their employer,
the company which is owned by the stockholders and bondholders (capital) and should therefore be
Jose D. Dula II
Atty. Gutierrez
entitled under the law to bargain collectively with the top management with respect to their terms and
conditions of employment.
Same; Where confidential employees are few in number.Since the confidential employees are very few
in number and are by practice and tradition identified with the supervisors in their role as representatives
of management vis-a-vis the rank and file employees, such identity of interest should allow their inclusion
in the bargaining unit of supervisors-managers for purposes of collective bargaining in turn as employees
in relation to the company as their employer. This will fulfill the laws objective of insuring to them the
full benefit of their right to self-organization and to collective bargaining, which could hardly be
accomplished if the respondent associations membership were to be broken up into five separate
ineffective tiny units as urged by the company.
Same; Court of Industrial Relations enjoys wide leeway in determining appropriate bargaining unit.The
industrial court enjoys a wide discretion in determining the procedure necessary to insure the fair and free
choice of bargaining representations by employees. [Filoil Refinery Corporation vs. Filoil Supervisory &
Confidential Employees Association, 46 SCRA 512(1972)]
Negros Oriental Electric Cooperative 1 vs. Secretary of the Department of Labor and Employment,
357 SCRA 668(2001)]
Remedial Law; Certiorari; Factual issues are not a proper subject for certiorari which is limited to the
issue of jurisdiction and grave abuse of discretion.The above finding was correctly upheld by the Court
of Appeals, and we find no cogent basis to reverse the same. Factual issues are not a proper subject for
certiorari which is limited to the issue of jurisdiction and grave abuse of discretion.
Same; Jurisdiction; The doctrine of primary jurisdiction does not warrant a court to arrogate unto itself the
authority to resolve a controversy the jurisdiction of which is initially lodged with an administrative body
of special competence.Indeed, the Court of Appeals cannot be expected to go over the list of alleged
supervisory employees attached to the petition before it and to pass judgment in the first instance on the
nature of the functions of each employee on the basis of the job description pertaining to him. As
appropriately observed by the said court, the determination of such factual issues is vested in the
appropriate Regional Office of the Department of Labor and Employment and pursuant to the doctrine of
primary jurisdiction, the Court should refrain from resolving such controversies. The doctrine of primary
jurisdiction does not warrant a court to arrogate unto itself the authority to resolve a controversy the
jurisdiction over which is initially lodged with an administrative body of special competence. [Negros
Oriental Electric Cooperative 1 vs. Secretary of the Department of Labor and Employment, 357 SCRA
668(2001)]
General Rubber and Footwear Corporation vs. Bureau of Labor Relations, 155 SCRA 283(1987)]
Labor; Labor Unions; Right to self-organization; Members who are not managerial employees but
considered rank-and-file employees have every right to self-organization or be heard through a duly
certified collective bargaining union; Reason.Thus, it can be readily seen from the above findings of the
Bureau of Labor Relations that the members of private respondent are not managerial employees as
claimed by petitioners but merely considered as rank-and-file employees who have every right to selforganization or to be heard through a duly certified collective bargaining union. The Supervisory power of
the members of private respondent union consists merely in recommending as to what managerial actions
to take in disciplinary cases. These members of private respondent union do not fit the definition of
managerial employees which We laid down in the case of Bulletin Publishing Corporation V. Sanchez
(144 SCRA 628). These members of private respondent union are therefore not prohibited from forming

their own collective bargaining unit since it has not been shown by petitioner that the responsibilities (of
these monthly-paid-employees) inherently require the exercise of discretion and independent judgment as
supervisors or that they possess the power and authority to lay down or exercise management policies.
Similarly, We held in the same case that Members of supervisory unions who do not fall within the
definition of managerial employees shall become eligible to join or assist the rank-and-file labor
organization, and if none exists, to form or assist in the forming of such rank-and-file organizations.
Same; Same; Same; Where private respondents-employees were not privy to the agreement between
petitioner and the previous bargaining representatives as to their exclusion from the bargaining union of
the rank-and-file or from forming their own union, they can never bind subsequent federations and unions;
Reason.Petitioner, in justification of its action, maintained that the exclusion of the members of the
private respondent from the bargaining union of the rank-and-file or from forming their own union was
agreed upon by petitioner corporation with the previous bargaining representatives namely: the General
Rubber Workers Union-PTGWO, the General Workers Union-NAFLU and the General Rubber Workers
Union (independent). Such posture has no leg to stand on. It has not been shown that private respondent
was privy to this agreement. And even if it were so, it can never bind subsequent federations and unions
particularly private respondent-union because it is a curtailment of the right to self-organization
guaranteed by the laber laws.
Same; Same; Same; Same; To avoid confusion and fulfill the policy of the Labor Code and to be
consistent with the ruling in the Bulletin case, the monthly-paid rank-and-file employees should be
allowed to join the union of daily paid rank-and-file employees or to form their own rank-and-file union.
However, to prevent any difficulty and to avoid confusion to all concerned and, more importantly, to
fulfill the policy of the New Labor Code as well as to be consistent with Our ruling in the Bulletin case,
supra, the monthly-paid rank-and-file employees should be allowed to join the union of the daily-paidrank-and-file employees of petitioner so that they can also avail of the CBA benefits or to form their own
rank and file union, without prejudice to the certification election that has been ordered. [General Rubber
and Footwear Corporation vs. Bureau of Labor Relations, 155 SCRA 283(1987)]
Dela Salle University vs. Dela Salle University Employees Association, 330 SCRA 363(2000)]
Labor Law; Certification Elections; Rules in a Petition for Certiorari Involving Labor Cases.Now,
before proceeding to the discussion and resolution of the issues raised in the pending petitions, certain
preliminary matters call for disposition. As we reiterated in the case of Caltex Refinery Employees
Association (CREA) vs. Jose S. Brillantes, the following are the well-settled rules in a petition for
certiorari involving labor cases. First, the factual findings of quasijudicial agencies (such as the
Department of Labor and Employment), when supported by substantial evidence, are binding on this
Court and entitled to great respect, considering the expertise of these agencies in their respective fields. It
is well-established that findings of these administrative agencies are generally accorded nbt only respect
but even finality. Second, substantial evidence in labor cases is such amount of relevant evidence which a
reasonable mind will accept as adequate to justify a conclusion. Third, in Flores vs. National Labor
Relations Commission, we explained the role and function of Rule 65 as an extraordinary remedy: It
should be noted, in the first place, that the instant petition is a special civil action for certiorari under Rule
65 of the Revised Rules of Court. An extraordinary remedy, its use is available only and restrictively in
truly exceptional casesthose wherein the action of an inferior court, board or officer performing judicial
or quasi-judicial acts is challenged for being wholly void on grounds of jurisdiction. The sole office of the
writ of certiorari is the correction of errors of jurisdiction including the commission of grave abuse of
discretion amounting to lack or excess of jurisdiction. It does not include correction of public respondent
Jose D. Dula II
Atty. Gutierrez
NLRCs evaluation of the evidence and factual findings based thereon, which are generally accorded not
only great respect but even finality.
Same; Same; Bargaining Units; Collective Bargaining Agreements; The express exclusion of certain
groups of employees from the bargaining unit of the rank-and-file employees in a previous collective
bargaining agreement does not bar any re-negotiation for the future inclusion of the said employees in the
bargaining unit.The Universitys arguments on the first issue fail to impress us. The Court agrees with
the Solicitor General that the express exclusion of the computer operators and discipline officers from the
bargaining unit of rank-and-file employees in the 1986 collective bargaining agreement does not bar any
re-negotiation for the future inclusion of the said employees in the bargaining unit. During the freedom
period, the parties may not only renew the existing collective bargaining agreement but may also propose
and discuss modifications or amendments thereto.
Same; Same; Same; Confidential Employees; Computer operators and discipline officers are not
confidential employees.With regard to the alleged confidential nature of the said employees functions,
after a careful consideration of the pleadings filed before this Court, we rule that the said computer
operators and discipline officers are not confidential employees. As carefully examined by the Solicitor
General, the service record of a computer operator reveals that his duties are basically clerical and nonconfidential in nature. As to the discipline officers, we agree with the voluntary arbitrator that based on the
nature of their duties, they are not confidential employees and should therefore be included in the
bargaining unit of rank-and-file employees.
Same; Same; Corporation Law; Piercing the Veil of Corporate Ficton; The employees of an affiliated
educational institution should be excluded from the bargaining unit of the rank-and-file employees of the
other institution where the two educational institutions have their own separate juridical personality and
no sufficient evidence was shown to justify the piercing of the veil of corporate fiction.The Court also
affirms the findings of the voluntary arbitrator that the employees of the College of St. Benilde should be
excluded from the bargaining unit of the rank-and-file employees of Dela Salle University, because the
two educational institutions have their own separate juridical personality and no sufficient evidence was
shown to justify the piercing of the veil of corporate fiction.
Same; Management Prerogatives; An employer, as an exercise of management prerogative, has the right to
adopt valid and equitable grounds as basis for terminating or transferring employees.We agree with the
voluntary arbitrator that as an exercise of management prerogative, the University has the right to adopt
valid and equitable grounds as basis for terminating or transferring employees. As we ruled in the case of
Autobus Workers Union (AWU) and Ricardo Escanlar vs. National Labor Relations Commission, [a]
valid exercise of management prerogative is one which, among others, covers: work assignment, working
methods, time, supervision of workers, transfer of employees, work supervision, and the discipline,
dismissal and recall of workers. Except as provided for, or limited by special laws, an employer is free to
regulate, according to his own discretion and judgment, all aspects of employment.
Same; Collective Bargaining; Financial Statements; Financial statements audited by independent external
auditors constitute the normal method of proof of profit and loss performance of a companythe financial
capability of a company cannot be based on its proposed budget because a proposed budget does not
reflect the true financial condition of a company.On the fourth issue involving the voluntary arbitrators
ruling that on the basis of the Universitys proposed budget, the University can no longer be required to
grant a second round of wage increases for the school years 1991-92 and 1992-93 and charge the same to
the incremental proceeds, we find that the voluntary arbitrator committed grave abuse of discretion
amounting to lack or excess of jurisdiction. As we ruled in the case of Caltex Refinery Employees
Association (CREA) vs. Jose S. Brillantes, x x x x x x. [w]e believe that the standard proof of a

companys financial standing is its financial statements duly audited by independent and credible external
auditors. Financial statements audited by independent external auditors constitute the normal method of
proof of profit and loss performance of a company. The financial capability of a company cannot be based
on its proposed budget because a proposed budget does not reflect the true financial condition of a
company, unlike audited financial statements, and more importantly, the use of a proposed budget as proof
of a companys financial condition would be susceptible to abuse by scheming employers who might be
merely feigning dire financial condition in their business ventures in order to avoid granting salary
increases and fringe benefits to their employees. [Dela Salle University vs. Dela Salle University
Employees Association, 330 SCRA 363(2000)]
Jose D. Dula II
Atty. Gutierrez

Part Five
National Union of Workers in Hotels, Restaurants and Allied Industries-Manila Pavillion Hotel
Chapter vs. Secretary of Labor and Employment, 594 SCRA 773(2009)
Labor Law; Collective Bargaining Agreements; Certification Election; In a certification election, all rank
and file employees in the appropriate bargaining unit, whether probationary or permanent are entitled to
vote.The inclusion of Gatbontons vote was proper not because it was not questioned but because
probationary employees have the right to vote in a certification election. The votes of the six other
probationary employees should thus also have been counted. As Airtime Specialists, Inc. v. Ferrer-Calleja,
180 SCRA 749 (1989), holds: In a certification election, all rank and file employees in the appropriate
bargaining unit, whether probationary or permanent are entitled to vote.
Same; Same; Same; Provision in the Collective Bargaining Agreement (CBA) disqualifying probationary
employees from voting cannot override the Constitutionally-protected right of workers to selforganization, as well as the provisions of Labor Code and its Implementing Rules on certification
elections and jurisprudence thereon.The provision in the CBA disqualifying probationary employees
from voting cannot override the Constitutionally-protected right of workers to self-organization, as well as
the provisions of the Labor Code and its Implementing Rules on certification elections and jurisprudence
thereon. A law is read into, and forms part of, a contract. Provisions in a contract are valid only if they are
not contrary to law, morals, good customs, public order or public policy.
Same; Same; Same; The period of reckoning in determining who shall be included in the list of eligible
voters is, in cases where a timely appeal has been filed from the Order of the Med-Arbiter, the date when
the Order of the Secretary of Labor and Employment, whether affirming or denying the appeal, becomes
final and executory.In light of the immediately-quoted provisions, and prescinding from the principle
that all employees are, from the first day of their employment, eligible for membership in a labor
organization, it is evident that the period of reckoning in determining who shall be included in the list of
eligible voters is, in cases where a timely appeal has been filed from the Order of the Med-Arbiter, the
date when the Order of the Secretary of Labor and Employment, whether affirming or denying the appeal,
becomes final and executory.
Same; Same; Same; A certification election is the process of determining the sole and exclusive bargaining
agent of the employees in an appropriate bargaining unit for purposes of collective bargaining; The
significance of an employees right to vote in a certification election cannot thus be overemphasized.A
certification election is the process of determining the sole and exclusive bargaining agent of the
employees in an appropriate bargaining unit for purposes of collective bargaining. Collective bargaining,
refers to the negotiated contract between a legitimate labor organization and the employer concerning
wages, hours of work and all other terms and conditions of employment in a bargaining unit. The
significance of an employees right to vote in a certification election cannot thus be overemphasized. For
he has considerable interest in the determination of who shall represent him in negotiating the terms and
conditions of his employment.
Same; Same; Same; Under the so-called double majority rule for there to be a valid certification
election, majority of the bargaining unit must have voted and the winning union must have garnered
majority of the valid votes cast; Majority is 50% + 1.As to whether HIMPHLU should be certified as
the exclusive bargaining agent, the Court rules in the negative. It is well-settled that under the so-called
double majority rule, for there to be a valid certification election, majority of the bargaining unit must
have voted AND the winning union must have garnered majority of the valid votes cast. Prescinding from
the Courts ruling that all the probationary employees votes should be deemed valid votes while that of
Jose D. Dula II
Atty. Gutierrez
the supervisory employees should be excluded, it follows that the number of valid votes cast would
increasefrom 321 to 337. Under Art. 256 of the Labor Code, the union obtaining the majority of the
valid votes cast by the eligible voters shall be certified as the sole and exclusive bargaining agent of all the
workers in the appropriate bargaining unit. This majority is 50% + 1. Hence, 50% of 337 is 168.5 + 1 or at
least 170.
Same; Same; Same; Two-fold objective of the conduct of a certification election.It bears reiteration that
the true importance of ascertaining the number of valid votes cast is for it to serve as basis for computing
the required majority, and not just to determine which union won the elections. The opening of the
segregated but valid votes has thus become material. To be sure, the conduct of a certification election has
a two-fold objective: to determine the appropriate bargaining unit and to ascertain the majority
representation of the bargaining representative, if the employees desire to be represented at all by anyone.
It is not simply the determination of who between two or more contending unions won, but whether it
effectively ascertains the will of the members of the bargaining unit as to whether they want to be
represented and which union they want to represent them.
Same; Same; Same; Run-off Election; Meaning of a Run-off Election.A run-off election refers to an
election between the labor unions receiving the two (2) highest number of votes in a certification or
consent election with three (3) or more choices, where such a certified or consent election results in none
of the three (3) or more choices receiving the majority of the valid votes cast; provided that the total
number of votes for all contending unions is at least fifty percent (50%) of the number of votes cast. With
346 votes cast, 337 of which are now deemed valid and HIMPHLU having only garnered 169 and
petitioner having obtained 151 and the choice NO UNION receiving 1 vote, then the holding of a runoff election between HIMPHLU and petitioner is in order. [National Union of Workers in Hotels,
Rwestaurants and Allied Industries-Manila Pavillion Hotel Chapter vs. Secretary of Labor and
Employment, 594 SCRA 773(2009)]
Warren Manufacturing Workers Union (WMWU) vs. Bureau of Labor Relations, 159 SCRA
387(1988)]
Labor; Certification Election; Distinction between a consent election and a certification election; Consent
election does not shorten the terms of nor entitle the participants to immediately renegotiate an existing
collective bargaining agreementThe records show that petitioner admitted that what was held on August
25, 1985 at the Companys premises and which became the root of this controversy, was a consent election
and not a certification election (italics supplied), As correctly distinguished by private respondent, a
consent election is an agreed one, its purpose being merely to determine the issue of majority
representation of all the workers in the appropriate collective bargaining unit while a certification election
is aimed at determining the sole and exclusive bargaining agent of all the employees in an appropriate
bargaining unit for the purpose of collective bargaining. From the very nature of consent election, it is a
separate and distinct process and has nothing to do with the import and effect of a certification election.
Neither does it shorten the terms of an existing CBA nor entitle the participants thereof to immediately
renegotiate an existing CBA although it does not preclude the workers from exercising their right to
choose their sole and exclusive bargaining representative after the expiration of the sixty (60) day freedom
period.
Same; Same; Election held in case at bar only to determine which labor union shall administer the existing
CBA.It is, therefore, unmistakable that the election thus held on August 25, 1985 was not for the
purpose of determining which labor union should be the bargaining representative in the negotiation for a
collective contract, there being an existing collective bargaining agreement yet to expire on July 31, 1986;
but only to determine which labor union shall administer the said existing contract.
Jose D. Dula II
Atty. Gutierrez
Same; Same; There should be no obstacle to the right of the employees to petition for certification election
within 60 days prior to the expiration of the 3-year period.Thus, as stated by this Court in General
Textiles Allied Workers Association v. The Director of the Bureau of Labor Relations (84 SCRA 430
[1978]) there should be no obstacle to the right of the employees to petition for a certification election at
the proper time, that is, within 60 days prior to the expiration of the three year period x x x.
and for all in a determination where everything is open to their sound judgment and the possibility of
fraud and misrepresentation is minimized, if not eliminated, without any unnecessary delay and/or
maneuvering. [Algire vs. De Mesa, 237 SCRA 647(1994)]
Same; Same; The premature agreement entered into by petitioner union and the company does not affect
the petition for certification election filed by the respondent union.Finally, such premature agreement
entered into by the petitioner and the Company on June 2, 1986 does not adversely affect the petition for
certification election filed by respondent PACIWU (Rollo, p. 85).
Labor Law; Labor Unions; An employer does not have the power to declare a union as the exclusive
representative of its workers for the purpose of collective bargaining.In accordance with this ruling,
Permex Producer should not have given its voluntary recognition to SMP-PIILU-TUCP when the latter
asked for recognition as exclusive collective bargaining agent of the employees of the company. The
company did not have the power to declare the union the exclusive representative of the workers for the
purpose of collective bargaining.
Same; Same; Interpretation; Administrative regulations and policies enacted by administrative bodies to
interpret the law have the force of law and entitled to great respect.Apart from the fact that the above
Rule is clear and explicit, leaving no room for construction or interpretation, it is an elementary rule in
administrative law that administrative regulations and policies enacted by administrative bodies to
interpret the law which they are entrusted to enforce, have the force of law and are entitled to great respect
(Espaol v. Philippine Veterans Administration, 137 SCRA 314 [1985]).
Same; Same; Requirements for certification election met; When the petition for certification election has
the support of at least 30% of the employees in the bargaining unit, it is mandatory for the Bureau of
Labor Relations to conduct a certification election.As aforestated, the existing collective bargaining
agreement was due to expire on July 31, 1986. The Med-Arbiter found that a sufficient number of
employees signified their consent to the filing of the petition and 107 employees authorized intervenor to
file a motion for intervention. Otherwise stated, he found that the petition and intervention were supported
by more than 30% of the members of the bargaining unit. In the light of these facts, Article 258 of the
Labor Code makes it mandatory for the Bureau of Labor Relations to conduct a certification election
(Samahang Manggagawa ng Pacific Mills, Inc. v. Noriel, et al., 134 SCRA 152 [1985]). In the case of
Federation of Free Workers (Bisig ng Manggagawa sa UTEX v. Noriel etc. et al, 86 SCRA 132 [1978]),
this Court was even more specific when it stated No administrative agency can ignore the imperative
tone of the above article. The language used is one of command. Once it has been verified that the petition
for certification election has the support of at least 30% of the employees in the bargaining unit, it must be
granted. The specific word used can yield no other meaning. It becomes under the circumstances,
mandatory x x. [Warren Manufacturing Workers Union (WMWU) vs. Bureau of Labor Relations, 159
SCRA 387(1988)]
Algire vs. De Mesa, 237 SCRA 647(1994)]
Labor Relations; Consent Election; Consent election is an agreed one, the purpose being merely to
determine the issue of majority representation of all the workers in the appropriate collective bargaining
unit.It is unmistakable that the election held on November 15, 1990 was a consent election and not a
certification election. It was an agreed one, the purpose being merely to determine the issue of majority
representation of all the workers in the appropriate collective bargaining unit. It is a separate and distinct
process and has nothing to do with the import and effort of a certification election.
Same; Certification Election; The choice by the majority of employees of the union officers that should
best represent them in the collective bargaining negotiations should be achieved through the democratic
process of an election.In any event, the choice by the majority of employees of the union officers that
should best represent them in the forthcoming collective bargaining negotiations should be achieved
through the democratic process of an election, the proper forum where the true will of the majority may
not be circumvented but clearly defined. The workers must be allowed to freely express their choice once
Samahang Manggagawa sa Permex vs. Secretary of Labor, 286 SCRA 692(1998)]
Same; Same; Certification Elections; Certification election is the most effective and the most democratic
way of determining which labor organization can truly represent the working force in the appropriate
bargaining unit of a company.Indeed, petitioners contention runs counter to the trend towards the
holding of certification election. By virtue of Executive Order No. 111, which became effective on March
4, 1987, the direct certification previously allowed under the Labor Code had been discontinued as a
method of selecting the exclusive bargaining agents of the workers. Certification election is the most
effective and the most democratic way of determining which labor organization can truly represent the
working force in the appropriate bargaining unit of a company.
Same; Same; Same; It is not enough that a union has the support of the majority of the employees.But it
is not enough that a union has the support of the majority of the employees. It is equally important that
everyone in the bargaining unit be given the opportunity to express himself. [Samahang Manggagawa sa
Permex vs. Secretary of Labor, 286 SCRA 692(1998)]
Oriental Tin Can Labor Union vs. Secretary gof Labor and Employment, 294 SCRA 640(1998)]
Labor Law; Labor Unions; Certification elections are exclusively the concern of employees; hence, the
employer lacks the legal personality to challenge the same.It is a well-established rule that certification
elections are exclusively the concern of employees; hence, the employer lacks the legal personality to
challenge the same. In Golden Farms, Inc. v. Secretary of Labor, the Court declared: x x x. Law and
policy demand that employers take a strict, hands-off stance in certification elections. The bargaining
representative of employees should be chosen free from any extraneous influence of management. A labor
bargaining representative, to be effective, must owe its loyalty to the employees alone and to no other.
Same; Same; The companys interference in the certification election below by actively opposing the same
is manifestly uncalledfor and unduly creates a suspicion that it intends to establish a company union.
The only instance when an employer may concern itself with employee representation activities is when it
has to file the petition for certification election because there is no existing CBA in the unit and it was
requested to bargain collectively, pursuant to Article 258 of the Labor Code. After filing the petition, the
role of the employer ceases and it becomes a mere bystander. The companys interference in the
certification election below by actively opposing the same is manifestly uncalled-for and unduly creates a
suspicion that it intends to establish a company union. On this score, it is clear that the perceived grave
abuse of discretion on the part of the Labor Secretary is non-existent and G.R. No. 116779 should,
consequently, be dismissed.
Same; Same; The Labor Code imposes upon the employer and the representative of the employees the
duty to bargain collectively.The Labor Code imposes upon the employer and the representative of the

employees the duty to bargain collectively. Since the question of right of representation as between
competing labor organizations in a bargaining unit is imbued with public interest, the law governs the
choice of a collective bargaining representative which shall be the duly certified agent of the employees
concerned. An official certification becomes necessary where the bargaining agent fails to present
adequate and reasonable proof of its majority authorization and where the employer demands it, or when
the employer honestly doubts the majority representation of several contending bargaining groups. In fact,
Article 255 of the Labor Code allows the majority of the employees in an appropriate collective
bargaining unit to designate or select the labor organization which shall be their exclusive representative
for the purpose of collective bargaining.
Same; Same; Collective Bargaining Agreements; If a collective bargaining agreement has been duly
registered in accordance with Article 231 of the Code, a petition for certification election or a motion for
intervention can only be entertained within sixty (60) days prior to the expiry date of such agreement.
Article 253-A of the Labor Code explicitly provides that the aspect of a unions representation of the rankand-file employees contained in the CBA shall be for a term of five (5) years and that (n)o petition
questioning the majority status of the incumbent bargaining agent shall be entertained and no certification
election shall be conducted by the Department of Labor and Employment outside of the sixty-day period
immediately before the date of expiry of such five year term of the Collective Bargaining Agreement.
Accordingly, Section 3, Rule V, Book V of the Omnibus Rules Implementing the Labor Code provides
that (i)f a collective bargaining agreement has been duly registered in accordance with Article 231 of the
Code, a petition for certification election or a motion for intervention can only be entertained within sixty
(60) days prior to the expiry date of such agreement.
Same; Same; Same; The agreement prematurely signed by the union and the company during the freedom
period does not affect the petition for certification election filed by another union.The filing of a
petition for certification election during the 60-day freedom period gives rise to a representation case that
must be resolved even though a new CBA has been entered into within that period. This is clearly
provided for in the aforequoted Section 4, Rule V, Book V of the Omnibus Rules Implementing the Labor
Code. The reason behind this rule is obvious. A petition for certification election is not necessary where
the employees are one in their choice of a representative in the bargaining process. Moreover, said
provision of the Omnibus Rules manifests the intent of the legislative authority to allow, if not encourage,
the contending unions in a bargaining unit to hold a certification election during the freedom period.
Hence, the Court held in the case of Warren Manufacturing Workers Union (WMWU) v. Bureau of Labor
Relations, that the agreement prematurely signed by the union and the company during the freedom period
does not affect the petition for certification election filed by another union.
Same; Same; Same; Once the required percentage requirement has been reached, the employees
withdrawal from union membership taking place after the filing of the petition for certification election
will not affect the petition.As regards the 25% support requirement, we concur with public respondents
finding that said requisite has been met in this case. With regard to the finding that the waiver document
executed by the employees was the product of duress, force and intimidation employed by the company
after it learned of the petition for certification election, the following pronouncement of the Court is
relevant: x x x. Even doubts as to the required 30% being met warrant (the) holding of the certification
election. In fact, once the required percentage requirement has been reached, the employees withdrawal
from union membership taking place after the filing of the petition for certification election will not affect
the petition. On the contrary, the presumption arises that the withdrawal was not free but was procured
through duress, coercion or for a valuable consideration. Hence, the subsequent disaffiliation of the six (6)
employees from the union will not be counted against or deducted from the previous number who had
signed up for certification elections. x x x.
Jose D. Dula II
Atty. Gutierrez
Same; Same; Same; It is judicially settled that a certification election is the most effective and expeditious
means of determining which labor organization can truly represent the working force in the appropriate
bargaining unit of the company.All doubts as to the number of employees actually supporting the
holding of a certification election should, therefore, be resolved by going through such procedure. It is
judicially settled that a certification election is the most effective and expeditious means of determining
which labor organization can truly represent the working force in the appropriate bargaining unit of the
company. If the OTCLU wanted to be retained as the rank-and-file employees bargaining representative,
it should have sought their vote, not engaged in legal sophistry. The selection by the majority of the
employees of the union which would best represent them in the CBA negotiations should be achieved
through the democratic process of an election. [Oriental Tin Can Labor Union vs. Secretary gof Labor and
Employment, 294 SCRA 640(1998)]
Colgate Palmolive Philippines, Inc. vs. Ople, 163 SCRA 323(1988)]
Labor Laws; Reinstatement; An employer cannot be compelled to continue with the employment ofa
person who admittedly was guilty of misfeasance towards his employer and whose continuance in the
service is patently inimical to his interest.The order of the respondent Minister to reinstate the
employees despite a clear finding of guilt on their part is not in conformity with law. Reinstatement is
simply incompatible with a finding of guilt. Where the totality of the evidence was sufficient to warrant
the dismissal of the employees the law warrants their dismissal without making any distinction between a
first offender and a habitual delinquent. Under the law, respondent Minister is duly mandated to equally
protect and respect not only the labor or workers' side but also the management and/or employers' side.
The law, in protecting the rights of the laborer, authorizes neither oppression nor self-destruction of the
employer. To order the reinstatement of the erring employees namely, Mejia, Sayson and Reynante would
in effect encourage unequal protection of the laws as a managerial employee of petitioner company
involved in the same incident was already dismissed and was not ordered to be reinstated. As stated by Us
in the case of San Miguel Brewery vs. National Labor Union, "an employer cannot legally be compelled
to continue with the employment of a person who admittedly was guilty of misfeasance or malfeasan^e
towards his employer, and whose continuance in the service of the latter is patently inimical to his
interest."
Same; Same; Certification Election; Procedure for a representation case, outlined in Arts. 257-260 of the
Labor Code in relation to Arts. 239-240; The requirements in ascertaining majority representation are
calculated to ensure that the certified bargaining representative is the true choice ofthe employees against
all contenders; Case at bar.The petition merits our consideration. The procedure for a representation
case is outlined in Arts. 257-260 of the Labor Code, in relation to the provisions on cancellation of a
Union registration under Arts. 239-240 thereof, the main purpose of which is to aid in ascertaining
majority representation. The requirements under the law, specifically Secs. 2, 5, and 6 of Rule V, Book V
of the Rules Implementing the Labor Code are all calculated to ensure that the certified bargaining
representative is the true choice of the -employees against all contenders. The Constitutional mandate that
the State shall "assure the rights of the workers to self-organization, collective bargaining, security of
tenure and just and humane conditions of work," should be achieved under a system of law such as the
aforementioned provisions of the pertinent statutes. When an overzealous official by-passes the law on the
pretext of retaining a laudable objective, the intendment or purpose of the law will lose its meaning as the
law itself is disregarded. When respondent Minister directly certified the Union, he in fact disregarded this
procedure and its legal requirements. There was therefore failure to determine with legal certainty whether
the Union indeed enjoyed majority representation. Contrary to the respondent Minister's observation, the
holding of a certification election at the proper time is not necessarily a mere formality as there was a
compelling legal reason not to directly and unilaterally certify a union whose legitimacy is precisely the
object of litigation in a pending cancellation case filed by certain "concerned salesmen," who also claim

majority status. Even in a case where a union has filed a petition for certification elections, the mere fact
that no opposition is made does not warrant a direct certification. More so as in the case at bar, when the
records of the suit show that the required proof was not presented in an appropriate proceeding and that
the basis of the direct certification was the Union's mere allegation in its position paper that it has 87 out
of 117 regular salesmen. In other words, respondent Minister merely relied on the self-serving assertion of
the respondent Union that it enjoyed the support of the majority of the salesmen, without subjecting such
assertion to the test of competing claims. As pointed out by petitioner in its petition, what the respondent
Minister achieved in rendering the assailed orders was to make a mockery of the procedure provided
under the law for representation cases because: (a) He has created havoc by impliedly establishing a
procedural shortcut to obtaining a direct certificationby merely filing a notice of strike. (b) By creating
such a short-cut, he has officially encouraged disrespect for the law. (c) By directly certifying a Union
without sufficient proof of majority representation, he has in effect arrogated unto himself the right, vested
naturally in the employees to choose their collective bargaining respresentative. (d) He has in effect
imposed upon the petitioner the obligation to negotiate with a union whose majority representation is
under serious question. This is highly irregular because while the Union enjoys the blessing of the
Minister, it does not enjoy the blessing of the employees. Petitioner is therefore under threat of being held
liable for refusing to negotiate with a union whose right to bargaining status has not been legally
established. (pp. 9-10, Rollo) The order of the respondent Minister to reinstate the employees despite a
clear finding of guilt on their part is not in conformity with law. Reinstatement is simply incompatible
with a finding of guilt. Where the totality of the evidence was sufficient to warrant the dismissal of the
employees the law warrants their dismissal without making any distinction between a first offender and a
habitual delinquent. Under the law, respondent Minister is duly mandated to equally protect and respect
not only the labor or workers' side but also the management and/or employers' side. The law, in protecting
the rights of the laborer, authorizes neither oppression nor selfdestruction of the employer. To order the
reinstatement of the erring employees namely, Mejia, Sayson and Reynante would in effect encourage
unequal protection of the laws as a managerial employee of petitioner company involved in the same
incident was already dismissed and was not ordered to be reinstated. As stated by Us in the case of San
Miguel Brewery vs. National Labor Union, "an employer cannot legally be compelled to continue with the
employment of a person who admittedly was guilty of misfeasance or malfeasance towards his employer,
and whose continuance in the service of the latter is patently inimical to his interest." [Colgate Palmolive
Philippines, Inc. vs. Ople, 163 SCRA 323(1988)]
George & Peter Lines, Inc. vs. Associated Labor Union, 134 SCRA 82(1985)]
Labor Law; Labor Relations; Certification Election; Constitutional Law; Constitutional right of employees
to choose their own labor organization; Holding of certification election, a statutory policy that should not
be circumvented.The employees have the constitutional right to choose the labor organization which it
desires to join. The exercise of such right would be rendered nugatory and ineffectual if they would be
denied the opportunity to choose in a certification election, which is not a litigation, but a mere
investigation of a non-adversary character, the bargaining unit to represent them. The holding of a
certification election is a statutory policy that should not be circumvented.
Same; Same; Same; Where the right of a labor union to represent the employees is doubtful due to the
withdrawal of 80% of the membership, the best form to determine whether undue pressure was exerted
upon the employees to retract their membership is in the certification election; Certification election, the
best and most appropriate means of ascertaining the will of the employees as to their choice of an
exclusive bargaining representative.As the right of respondent Union to represent the employees is
seriously put in doubt by the withdrawal of 80% of the membership, which the Union claims to be
involuntary, the best forum to determine if there was, in deed, undue pressure exerted upon the employees
to retract their membership is in the certification election itself, wherein they can freely express their
Jose D. Dula II
Atty. Gutierrez
choice in a secret ballot. Certification election is the best and most appropriate means of ascertaining the
will of the employees as to their choice of an exclusive bargaining representative. That there are no
competing Unions involved should not alter that principle, the freedom of choice by the employees being
the primordial consideration besides the fact that the employees can still choose between ALU and No
Union. Even if the withdrawals of the employees concerned were submitted after the Petition for direct
certification had been filed, the doubt as to the majority representation of the Union has arisen, and it is
best to determine the true sentiment of the employees through a certification election. If respondent Union
is confident that it commands the majority of the workers, there is no reason why it should object to the
holding of a certification election. [George & Peter Lines, Inc. vs. Associated Labor Union, 134 SCRA
82(1985)]
Barbizon Philippines, Inc. vs. Nagkakaisang Supervisor ng Barbizon Philippines, Inc.-NAFLU, 261
SCRA 738(1996)]
Labor Law; Right to Self-Organization; Certification Election; The exclusion of a companys
supervisors from the bargaining unit of the rank-and-file employees indiscriminately curtails the right of
such employees to self-organization and representation for purposes of collective bargaining.The
exclusion of petitioners supervisors from the bargaining unit of the rank-and-file employees
indiscriminately curtailed the right of these employees to self-organization and representation for purposes
of collective bargaining, a right explicitly mandated by our labor laws and accorded the highest
consideration.
Same; Same; Same; One Union-One Company Rule; The one company-one union policy must yield to
the right of the employees to form unions or associations for purposes not contrary to law, to
selforganization and to enter into collective bargaining negotiations, among others, which the Constitution
guarantees.As clearly indicated in the aforequoted decision, the one union-one company rule is not
without exception. The exclusion of the subject employees from the rank-and-file bargaining unit and the
CBA is definitely a compelling reason for it completely deprived them of the chance to bargain
collectively with petitioner and are thus left with no recourse but to group themselves into a separate and
distinct bargaining unit and form their own organization. The rationale behind the exception to the
aforementioned policy is further elucidated in Knitjoy Manufacturing, Inc. v. Ferrer-Calleja. The usual
exception, of course, is where the employer unit has to give way to the other units like the craft unit, plant
unit, or a subdivision thereof, the recognition of these exceptions takes into account the policy to assure
employees of the fullest freedom in exercising their rights. Otherwise stated, the one company-one union
policy must yield to the right of the employees to form unions or associations for purposes not contrary to
law, to self-organization and to enter into collective bargaining negotiations, among others, which the
Constitution guarantees. (Italics ours.)
Same; Same; Same; Same; The receipt by supervisor employees of certain benefits under the CBA
between the union of rank-andfile employees and the company is not sufficient reason to deny the petition
for certification election filed by the labor organization formed by the excluded employees.The receipt
by petitioners supervisor employees of certain benefits under the CBA between BUKLOD and
petitioner is not sufficient to deny the petition for certification election filed by the labor organization
formed by the excluded employees. It is not equivalent to and does not compensate for the denial of the
right of the excluded employees to selforganization and collective bargaining.
Same; Same; Same; Contract-Bar Rule; The contract-bar rule has no application where the petition for
certification election is addressed to a separate bargaining unit.The petition for certification election
cannot likewise be deterred by the contract-bar rule, which finds no application in the present case. The
petitioning union NSBPI is not questioning the majority status of Buklod as the incumbent bargaining

agent of petitioners rank and file employees. The petition for certification election is addressed to a
separate bargaining unitthe excluded employees of petitioner.
Same; Same; Same; The right to self-organization and collective bargaining is an integral part of the
protection to labor provision embodied in the Constitution.The right to self organization and collective
bargaining is an integral part of the protection to labor provision embodied in our Constitution, the essence
of which is aptly expressed in Tropical Hut Employees Union-CGW v. Tropical Hut Food Market, Inc.:
All employees enjoy the right to self-organization and to form and join labor organizations of their own
choosing for the purpose of collective bargaining and to engage in concerted activities for their mutual aid
or protection. This is a fundamental right of labor that derives its existence from the Constitution. In
interpreting the protection to labor and social justice provisions of the Constitution and the labor laws or
rights.
Same; Same; Same; A certification election is the sole concern of the workers, hence, an employer lacks
the personality to dispute the same.Finally, we take this opportunity to reiterate the standing rule that a
certification election is the sole concern of the workers, hence, an employer lacks the personality to
dispute the same. In Golden Farms, Inc. v. Secretary of Labor, we held: Finally, we note that it was
petitioner company that filed the motion to dismiss the petition for election. The general rule is that an
employer has no standing to question a certification election since this is the sole concern of the workers.
Law and policy demand that employers take a strict, hands-off stance in certification elections. The
bargaining representative of employees should be chosen free from any extraneous influence of
management. A labor bargaining representative, to be effective, must owe its loyalty to the employees
alone and to no other. [Barbizon Philippines, Inc. vs. Nagkakaisang Supervisor ng Barbizon Philippines,
Inc.-NAFLU, 261 SCRA 738(1996)]
Jose D. Dula II
Atty. Gutierrez
Same; Same; Same.The purpose of a certification election is precisely the ascertainment of the wishes
of the majority of the employees in the appropriate bargaining unit: to be or not to be represented by a
labor organization, and in the affirmative case, by which particular labor organization. If the results of the
election should disclose that the majority of the workers do not wish to be represented by any union, then
their wishes must be respected, and no union may properly be certified as the exclusive representative of
the workers in the bargaining unit in dealing with the employer regarding wages, hours and other terms
and conditions of employment. The minority employeeswho wish to have a union represent them in
collective bargainingcan do nothing but wait for another suitable occasion to petition for a certification
election and hope that the results will be different. They may not and should not be permitted, however, to
impose their will on the majoritywho do not desire to have a union certified as the exclusive workers'
benefit in the bargaining unitupon the plea that they, the minority workers, are being denied the right of
self-organization and collective bargaining. As repeatedly stated, the right of self-organization embraces
not only the right to form, join or assist labor organizations, but the concomitant, converse right NOT to
form, join or assist any labor union.
Reyes vs. Trajano, 209 SCRA 484(1992)
Same; INK employees have the right to participate in a certification election and vote for "No Union."
That the INK employees, as employees in the same bargaining unit in the true sense of the term, do have
the right of self-organization, is also in truth beyond question, as well as the fact that when they voted that
the employees in their bargaining unit should be represented by "NO UNION," they were simply
exercising that right of self-organization, albeit in its negative aspect. The respondents' argument that the
petitioners are disqualified to vote because they "are not constituted into a duly organized labor
union""but members of the INK which prohibits its followers, on religious grounds, from joining or
forming any labor organization"and "hence, not one of the unions which vied for certification as sole
and exclusive bargaining representative," is specious. Neither law, administrative rule nor jurisprudence
requires that only employees affiliated with any labor organization may take part in a certification
election. On the contrary, the plainly discernible intendment of the law is to grant the right to vote to all
bona fide employees in the bargaining unit, whether they are members of a labor organization or not,
Labor Law; Words and Phrases; The right to self-organization includes the right not to form or join a
union.Logically, the right NOT to join, affiliate with, or assist any union, and to disaffiliate or resign
from a labor organization, is subsumed in the right to join, affiliate with, or assist any union, and to
maintain membership therein. The right to form or join a labor organization necessarily includes the right
to refuse or refrain from exercising said right. It is self-evident that just as no one should be denied the
exercise of a right granted by law, so also, no one should be compelled to exercise such a conferred right.
The fact that a person has opted to acquire membership in a labor union does not preclude his
subsequently opting to renounce such membership.
Same; Failure to take part in previous elections no bar to right to participate in future elections.Neither
does the contention that petitioners should be denied the right to vote because they "did not participate in
previous certification elections in the company for the reason that their religious beliefs do not allow them
to form, join or assist labor organizations," persuade acceptance. No law, administrative rule or precedent
prescribes forfeiture of the right to vote by reason of neglect to exercise the right in past certification
elections. In denying the petitioners' right to vote upon these egregiously fallacious grounds, the public
respondents exercised their discretion whimsically, capriciously and oppressively and gravely abused the
same. [Reyes vs. Trajano, 209 SCRA 484(1992)]
Natl. Mines and Allied Workers Union vs. Secretary of Labor, 227 SCRA 821(1993)
Labor Law; Certification Election; Pleadings and Practice; Verification; Verification of pleading is a
formal not jurisdictional requisite. Generally, technical and rigid rules of procedure are not binding in
labor cases specifically certification election proceedings which are non-litigious but mere investigative
and non-adversarial in character.Verification of a pleading is a formal, not jurisdictional requisite
(Buenaventura v. Uy, 149 SCRA 22 [1987]; In the Matter of the Change of Name of Antonina B. Oshita,
19 SCRA 700 [1967]. Even if verification is lacking and the pleading is formally defective, the courts may
dispense with the requirement in the interest of justice and order the correction of the pleading
accordingly. Generally, technical and rigid rules of procedure are not binding in labor cases; and this rule
is specifically applied in certification election proceedings, which are non-litigious but merely
Jose D. Dula II
Atty. Gutierrez
investigative and non-adversarial in character (Associated Labor Unions vs. Ferrer-Calleja, 179 SCRA
127 [1989]; Tanduay Distillery Labor Union v. NLRC, 149 SCRA 470 [1987]). Nevertheless, whatever
formal defects existed in the first petition were cured and corrected in the second petition for certification
election.
Clearly, private respondents registration is not covered by the prohibition. In any event, the union
registration was effected in September 1990, a month before the secretary of labor issued his decision on
the result of the certification election on October 31, 1990. Hence, there was yet no certified bargaining
agent when the private respondent was registered as a union.
Same; Same; The number of undisputed signatures represents more than 25% of the total number of
company employees required by law to support a petition for certification election.Granting that 36
signatures were falsified and that 13 were disowned, this leaves 92 undisputed signatures which is
definitely more than 75i.e., 25% of the total number of company employees required by law to support
a petition for certification election. The disclaimer by 13 employees of their respective signatures covers
only their own personal participation and cannot in any way be extended to include the rest of those who
did not question the same.
Same; Same; Section 6 of PD 1391 has nothing to do with the registration of a union.Very clearly, the
foregoing provision does not help petitioner. It has nothing to do with the registration of a union. It deals
only with petitions for certification election, intervention or disaffiliation and notwe hazard being
redundantto applications for registration of a new union.
Same; Same; When all the requirements have been complied, it is incumbent upon the Med-Arbiter to
order a certification election to be conducted.The fact that the list of signatures is undated does not
necessarily mean that the signatures were obtained prior to the 60-day freedom period before the
expiration of the existing collective bargaining agreement. What is important is that the petition for
certification election must be filed during the freedom period and that the 25% requirement of supporting
signatures be met upon the filing thereof. These requirements have been complied by respondent FFWSMQCC in their first and second petitions, and it was thus incumbent upon the Med-Arbiter to order a
certification election to be conducted among the rank and file employees of the company (Labor Code of
the Philippines, Art. 256; Warrent Mfg. Workers Union v. Bureau of Labor Relations, 159 SCRA 387
[1988]; Samahang Manggagawa ng Pacific Mills v. Noriel, 134 SCRA 152 [1985]).
Same; Same; Certification election is the most effective and expeditious way to determine which labor
organization truly represents the working force in the appropriate bargaining unit of the company.If
indeed there are employees in the bargaining unit who refuses to be represented by respondent FFWSMQCC with all the more reason should a certification election be held where the employees themselves
can freely and voluntarily express by secret ballot their choice of bargaining representative. A certification
election is the most effective and expeditious way to determine which labor organization can truly
represent the working force in the appropriate bargaining unit of the company (Central Negros Electric
Cooperative, Inc. v. Sec. of Labor, 201 SCRA 584 [1991]; National Association of Free Trade Unions v.
Bureau of Labor Relations, 164 SCRA 12 [1988]). [Natl. Mines and Allied Workers Union vs. Secretary
of Labor, 227 SCRA 821(1993)]
Katipunan ng mga Manggagawa sa Daungan vs. Ferrer-Calleja, 278 SCRA 531(1997)]
Labor Law; Labor Unions; Appeals; Factual findings of quasijudicial agencies, like the Labor Department,
which have acquired expertise in matters entrusted to their jurisdiction are accorded by the Court not only
respect but finality if supported by substantial evidence.It is settled that factual findings of quasijudicial agencies, like the Labor Department, which have acquired expertise in matters entrusted to their
jurisdiction are accorded by this Court not only respect but finality if supported by substantial evidence.
Substantial evidence refers to that amount of relevant evidence which a reasonable mind may accept as
adequate to justify a conclusion.
Same; Same; Section 3, Rule V, Book V of the Omnibus Rules Implementing the Labor Code prohibits not
the registration of a new union but the holding of a certification election within one year from the date of
issuance of a final certification election result.Section 3, Rule V, Book V of the Omnibus Rules
Implementing the Labor Code, prohibits not the registration of a new union but the holding of a
certification election within one year from the date of issuance of a final certification election result.
Same; Same; Section 5, Rule II, Book V of the Omnibus Rules Implementing the Labor Code enumerates
the grounds for the denial of registration to local unions, and the existence of another union is not one of
these grounds.Moreover, the issue of which union truly represents the working force should be raised
during the certification election, not during the registration period. Indeed, a certification election provides
the most effective and expeditious mode to determine the real representatives of the working force in the
appropriate bargaining unit. It may be well to add that Section 5, Rule II, Book V of the Omnibus Rules
Implementing the Labor Code, enumerates the grounds for the denial of registration to local unions, and
the existence of another union is not one of these grounds. [Katipunan ng mga Manggagawa sa Daungan
vs. Ferrer-Calleja, 278 SCRA 531(1997)]
Cruzvale, Inc. vs. Laguesma, 238 SCRA 389(1994)]
Labor Law; Petition for Certification Election; Jurisdiction; Jurisdiction as used in the provision refers
to the venue where the petition for certification must be filed.The word jurisdiction as used in said
provision refers to the venue where the petition for certification must be filed. Unlike jurisdiction, which
implies the power of the court to decide a case, venue merely refers to the place where the action shall be
brought (Sulo ng Bayan, Inc. v. Araneta, Inc. 72 SCRA 347 [1976]). Venue touches more the convenience
of the parties rather than the substance of the case (Consolidated Bank v. Intermediate Appellate Court,
198 SCRA 34 [1991]).
Same; Same; Same; Labor Code; Sec. 1, Rule V, Book V of the Omnibus Rules Implementing the Labor
Code refers only to cases where the place of work of the employees and the place of the principal office of
the employer are within the same territorial jurisdiction of the Regional Office where the Petition for
certification election is filed.Section 1, Rule V, Book V of the Omnibus Rules Implementing the Labor
Code refers only to cases where the place of work of the employees and the place of the principal office of
the employer are within the same territorial jurisdiction of the Regional Office where the petition for
certification election is filed. The said provision does not apply to the filing of the petitions for
certification election where the place of work of the employees and the place of principal office of the
employer are located within the territorial jurisdictions of different regional offices. We assume that in the
drafting of the Omnibus Rules, the Secretary of Labor and Employment took into consideration the fact
that there are many companies with factories located in places different from places where the corporate
offices are located.
Same; Same; Same; Same; The nearest governmental machinery to settle a labor dispute must be placed at
the workers immediate disposal.The worker, being the economically-disadvantaged party whether as
complainant, petitioner or respondent, as the case may be, the nearest governmental machinery to settle a
labor dispute must be placed at his immediate disposal and the employer must in no case be allowed a
choice in favor of another competent agency sitting in another place to the inconvenience of the worker
(Nestle Philippines, Inc. v. National Labor Relations Commission, 209 SCRA 834 [1992]).

Same; Same; Same; Same; New Rules of Procedure of the NLRC prescribes that all cases in which labor
arbiters have jurisdiction should be filed in the branch office which has territorial jurisdiction over the
workplace of the complainant/petitioner.Unlike in the Rules governing the procedure before Regional
Offices, the New Rules of Procedure of the National Labor Relations Commission prescribes that all cases
in which labor arbiters have jurisdiction should be filed in the branch office which has territorial
jurisdiction over the workplace of the complainant/petitioner (Rule IV, Sec. 1[a]). The NLRC Rules
defines the workplace as follows: For purposes of venue, workplace shall be understood as the place or
locality where the employee is regularly assigned when the cause of action arose. It shall include the place
where the employee is supposed to report back after a temporary detail, assignment or travel. x x x.
Same; Same; Same; Where the employer appeared twice at the hearing of the petition for certification
election without questioning the venue, said employer is barred from raising the issue in the subsequent
proceedings.The Omnibus Rules Implementing the Labor Code has no provision as to when an
objection to improper venue may be raised. The Med-Arbiter ruled that where the employer had appeared
twice at the hearing of the petition for certification election without questioning the venue, said employer
was barred from raising the issue in the subsequent proceedings. [Cruzvale, Inc. vs. Laguesma, 238 SCRA
389(1994)]
California Manufacturing Corporation vs. Laguesma, 209 SCRA 606(1992)]
Labor Law; Words and Phrases; Meaning of term "unorganized establishment" in Art 257 of Labor Code.
The Court has already categorically ruled that Article 257 of the Labor Code is applicable to
unorganized labor organizations and not to establishments where there exists a certified bargaining agent
which had previously entered into a collective bargaining agreement with the management (Associated
Labor Unions [ALU] v. Calleja, G.R. No. 85085, November 6, 1989, 179 SCRA 127) (Italics supplied).
Otherwise stated, the establishment concerned must have no certified bargaining agent (Associated Labor
Unions [ALU] v. Calleja, G.R. No. 82260, July 19, 1989, 175 SCRA 490). In the instant case, it is beyond
cavil that the supervisors of CMC which constitute a bargaining unit separate and distinct from that of the
rank-and-file, have no such agent, thus they correctly filed a petition for certification election thru union
FFW-CALMASUCO, likewise indubitably a legitimate labor organization. CMC's insistence on the 25%
subscription requirement, is clearly immaterial. The same has been expressly deleted by Section 24 of
Republic Act No. 6715 and is presently prescribed only in organized establishments, that is, those with
existing bargaining agents.
Same; Compliance with 25% signature requirement before certification election is not mandatory.
Compliance with the said requirement need not even be established with absolute certainty. The Court has
consistently ruled that "even conceding that the statutory requirement of 30% (now 25%) of the labor
force asking for a certification election had not been strictly complied with, the Director (now the MedArbiter) is still empowered to order that it be held precisely for the purpose of ascertaining which of the
contending labor organizations shall be the exclusive collective bargaining agent (Atlas Free Workers
Union (AFWU)-PSSLU Local v. Noriel, G.R No. L-51905, May 26,1981,104 SCRA 565). The
requirement then is relevant only when it becomes mandatory to conduct a certification election. In all
other instances, the discretion, according to the rulings of this Tribunal ought to be ordinarily exercised in
favor of a petition for certification.
Same; Actions; An employer has no legal personality to oppose petition for certification election.In any
event, CMC as employer has no standing to question a certification election (Asian Design and
Manufacturing Corporation v. Calleja, et al., G.R. No. 77415, June 29, 1989,174 SCRA 477). Such is the
sole concern of the workers. The only exception is where the employer has to file the petition for
certification election pursuant to Article 259 (now 258) of the Labor Code because it was requested to
Jose D. Dula II
Atty. Gutierrez
bargain collectively. Thereafter, the role of the employer in the certification process ceases. The employer
becomes merely a by-stander. [California Manufacturing Corporation vs. Laguesma, 209 SCRA
606(1992)]
Atlantic, Gulf and Pacific Co. of Manila, Inc. vs. Laguesma, 212 SCRA 281(1992)]
Labor Law; Regular Employees; The regularization of all the regular project employees with at least one
year of service and their membership with the URFA mean that the alleged regular project employees
whom respondent LAKAS-NFL seeks to represent are regular employees by contemplation of law and
included in the appropriate bargaining unit of said collective bargaining.Although the aforementioned
definition does not include petitioners regular project employees in the coverage of the existing
Collective Bargaining Agreement between petitioner and the URFA, the regularization of all the regular
project employees with at least one year of service and the subsequent membership of said employees
with the URFA mean that the alleged regular project employees whom respondent LAKAS-NFL seeks to
represent are, in fact, regular employees by contemplation of law and included in the appropriate
bargaining unit of said Collective Bargaining Agreement consequently, the bargaining unit which
respondent LAKAS-NFL seeks to represent has already ceased to exist.
Same; Same; Collective bargaining agreement; The existence of a duly registered collective bargaining
agreement between petitioner and URFA, bars any other labor organization from filing a petition for
certification election except within the 60-day freedom period.Consequently, the existence of a duly
registered Collective Bargaining Agreement between the petitioner and URFA, which is the sole and
exclusive bargaining representative of all the regular rank-and-file employees of the petitioner including
the regular project employees with more than one year of service, bars any other labor organization from
filing a petition for certification election except within the 60-day period prior to the expiration of the
Collective Bargaining Agreement. To rule otherwise would negate the legislative intent in the enactment
of Article 232 of the Labor Code which was designed to ensure industrial peace between the employer and
its employees during the existence of the collective bargaining agreement. [Atlantic, Gulf and Pacific Co.
of Manila, Inc. vs. Laguesma, 212 SCRA 281(1992)]
Associated Labor Unions (ALU) vs. Ferrer-Calleja, 179 SCRA 127(1989)]
Labor Law; Certification Election; Certification election not a litigation but merely an investigation of a
non-adversarial and factfinding character; hence not covered by technical rules of procedure and evidence.
As it has been ruled in a long line of decisions, a certification proceedings is not a litigation in the sense
that the term is ordinarily understood, but an investigation of a non-adversarial and fact-finding character.
As such it is not covered by the technical rules of evidence. Thus, as provided under Article 221 of the
Labor Code, proceedings before the National Labor Relations Commission (NLRC) are not covered by the
technical rules of procedure and evidence. The Court had previousy construed Article 221 as to allow the
NLRC or the labor arbiter to decide the case on the basis of position papers and other documents
submitted without resorting to technical rules of evidence as observed in regular courts of justice.
Same; Same; Requirement of 20% signature for a certification election under Art. 257 applies only in
unorganized labor organization.On the other hand, Article 257 is applicable only to unorganized labor
organizations and not to establishments like PASAR where there exists a certified bargaining agent,
petitioner ALU, which as the record shows had previously entered into a CBA with the management. This
could be discerned from the clear intent of the law which provides thatART. 257. Petitions in
unorganized establishmentsIn any establishment where there is no certified bargaining agent, the
petition for certification election filed by a legitimate labor organization shall be supported by the written
consent of at least twenty per cent (20%) of all the employees in the bargaining unit. Upon receipt and

verification of such petition, the Med-Arbiter shall automatically order the conduct of a certification
election.
Same; Same; Mere filing of a petition for certification election within prescribed period, sufficient basis
for the Director to order holding of a certification election.Article 256 is clear and leaves no room for
interpretation. The mere filing of a petition for certification election within the freedom period is sufficient
basis for the respondent Director to order the holding of a certification election.
Same; Same; Contract Bar Rule; Contract bar rule applies only where the petition for certification election
was filed either before or after the freedom period.The contract bar rule is applicable only where the
petition for certification election was filed either before or after the freedom period. Petitioner, however,
contends that since the new CBA had already been ratified overwhelmingly by the members of the
bargaining unit and that said CBA had already been consummated and the members of the bargaining unit
have been continuously enjoying the benefits under the said CBA, no certification elec-tion may be
conducted, citing Foamtex Labor Union-TUPAS vs. Noriel, and Trade Unions of the Phil. and Allied
Services vs. Inciong. [Associated Labor Unions (ALU) vs. Ferrer-Calleja, 179 SCRA 127(1989)]
National Congress of Unions in the Sugar Industry of the Phils. vs. Ferrer-Calleja, 205 SCRA
478(1992)]
Labor Law; Collective Bargaining Agreement; Certification Elections; Rule that only a certified collective
bargaining agreement i.e., an agreement duly certified by the BLR may serve as a bar to certification
elections.It is a rule in this jurisdiction that only a certified collective bargaining agreementi.e., an
agreement duly certified by the BLR may serve as a bar to certification elections. (Philippine Association
of Free Labor Unions (PAFLU) v. Estrella, G.R. No. 45323, February 20, 1989, 170 SCRA 378, 382) It is
noteworthy that the Bureau of Labor Relations duly certified the November 14,1984 collective bargaining
agreement. Hence, the contract-bar rule as embodied in Section 3, Rule V, Book V of the rules
implementing the Labor Code is applicable. This rule simply provides that a petition for certification
election or a motion for intervention can only be entertained within sixty days prior to the expiry date of
an existing collective bargaining agreement. Otherwise put, the rule prohibits the filing of a petition for
certification election during the existence of a collective bargaining agreement except within the freedom
period, as it is called, when the said agreement is about to expire. The purpose, obviously, is to ensure
stability in the relationships of the workers and the management by preventing frequent modifications of
any collective bargaining agreement earlier entered into by them in good faith and for the stipulated
original period.
Same; Same; Contract bar rule; It shall be the duty of both parties to keep the status quo and to continue in
full force and effect the terms and conditions of the existing agreement during the 60-day period and/or
until a new agreement is reached by the parties.Anent the petitioner's contention that since the
expiration of the CBA in 1987 private respondent NFSW-FGT-KMU and Dacongcogon had not concluded
a new CBA, We need only to stress what was held in the case of Lopez Sugar Corporation v. Federation of
Free Workers, Philippine Labor Union Association (G.R. No. 75700-01, 30 August 1990, 189 SCRA
179,191) quoting Article 253 of the Labor Code that "(i)t shall be the duty of both parties to keep the
status quo and to continue in full force and effect the terms and conditions of the existing agreement
during the 60-day period and/or until a new agreement is reached by the parties." Despite the lapse of the
formal effectivity of the CBA the law still considers the same as continuing in force and effect until a new
CBA shall have been validly executed. Hence, the contract bar rule still applies. Besides, it should be
emphasized that Dacongcogon, in its answer stated that the CBA was extended for another three (3) years
and that the deadlock was submitted to the Labor Management Council. [National Congress of Unions in
the Sugar Industry of the Phils. vs. Ferrer-Calleja, 205 SCRA 478(1992)]
Jose D. Dula II
Atty. Gutierrez
Progressive Development Corp.-Pizza Hut vs. Laguesma, 271 SCRA 593(1997)]

Labor Law; Labor Organizations; Certification Elections; After a labor organization has filed the
necessary papers and documents for registration, it becomes mandatory for the Bureau of Labor Relations
to check if the requirements under Article 234 of the Labor Code have been sedulously complied with.
After a certificate of recognition has been issued, the propriety of the labor organizations registration
could be assailed directly through cancellation of registration proceedings in accordance with Articles 238
and 239 of the Labor Code, or indirectly, by challenging its petition for the issuance of an order for
certification election.In the public respondents assailed Resolution dated December 29, 1993, the
suggestion is made that once a labor organization has filed the necessary documents and papers and the
same have been certified under oath and attested to, said organization necessarily becomes clothed with
the character of a legitimate labor organization. In essence, therefore, the real controversy in this case
centers on the question of whether or not, after the necessary papers and documents have been filed by a
labor organization, recognition by the Bureau of Labor Relations merely becomes a ministerial function.
We do not agree. In the first place, the public respondents views as expressed in his December 29, 1993
Resolution miss the entire point behind the nature and purpose of proceedings leading to the recognition
of unions as legitimate labor organizations. A more than cursory reading of the aforecited provisions
clearly indicates that the requirements embodied therein are intended as preventive measures against the
commission of fraud. After a labor organization has filed the necessary papers and documents for
registration, it becomes mandatory for the Bureau of Labor Relations to check if the requirements under
Article 234 have been sedulously complied with. If its application for registration is vitiated by
falsification and serious irregularities, especially those appearing on the face of the application and the
supporting documents, a labor organization should be denied recognition as a legitimate labor
organization. And if a certificate of recognition has been issued, the propriety of the labor organizations
registration could be assailed directly through cancellation of registration proceedings in accordance with
Articles 238 and 239 of the Labor Code, or indirectly, by challenging its petition for the issuance of an
order for certification election.
Same; Same; Same; Registration requirements specifically 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 dues or use the labor organization for illegitimate ends.These measures are necessary
and may be undertaken simultaneouslyif the spirit behind the Labor Codes requirements for
registration are to be given flesh and blood. Registration requirements specifically 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 use the labor organization for illegitimate ends. Such
requirements are a valid exercise of the police power, because the activities in which labor organizations,
associations and unions of workers are engaged directly affect the public interest and should be protected.
Same; Same; Same; The Med-Arbiter should look into the merits of the petition for cancellation of a
unions registration before issuing an order calling for certification electionregistration based on false
and fraudulent statements and documents confer no legitimacy upon a labor organization irregularly
recognized, which, at best, holds on to a mere scrap of paper.The grounds ventilated in cancellation
proceedings in accordance with Article 239 of the Labor Code constitute a grave challenge to the right of
respondent Union to ask for certification election. The Med-Arbiter should have looked into the merits of
the petition for cancellation before issuing an order calling for certification election. Registration based on
false and fraudulent statements and documents confer no legitimacy upon a labor organization irregularly
recognized, which, at best, holds on to a mere scrap of paper. Under such circumstances, the labor
organization, not being a legitimate labor organization, acquires no rights, particularly the right to ask for
certification election in a bargaining unit.

Same; Same; Same; The invalidity of a unions registration would negate its legal personality to
participate in certification election.As we laid emphasis in Progressive Development Corporation vs.
Secretary of Labor, [t]he employer needs the 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. Clearly,
fraud, falsification and misrepresentation in obtaining recognition as a legitimate labor organization are
contrary to the Med-Arbiters conclusion not merely collateral issues. The invalidity of respondent
Unions registration would negate its legal personality to participate in certification election.
Same; Same; Same; Where the legal personality of a union is seriously challenged, it would be more
prudent for the Med-Arbiter to grant the request for suspension of proceedings in the certification election
case until the issue of the legality of the unions registration shall have been resolved.Inasmuch as the
legal personality of respondent Union had been seriously challenged, it would have been more prudent for
the Med-Arbiter and public respondent to have granted petitioners request for the suspension of
proceedings in the certification election case, until the issue of the legality of the Unions registration shall
have been resolved. Failure of the Med-Arbiter and public respondent to heed the request constituted a
grave abuse of discretion. [Progressive Development Corp.-Pizza Hut vs. Laguesma, 271 SCRA
593(1997)]
Todays Knitting Free Workers Union vs. Noriel, 75 SCRA 450(1977)]
Labor Code; It is the Director of Labor Relations, rather than a union that is required, under Article 257 of
the Labor Code, to determine whether there has been compliance with the requirement that at least 30% of
all the employees in the bargaining consented in writing to the holding of a certification election.To
sustain what on its face appears to be an insubstantial claim of failure to abide by statutory command as
set forth in the Labor Code, petitioner would interpret its Article 257 as requiring that it be afforded the
right to examine the alleged signatures of the employees comprising at least the 30% of the bargaining
unit desirous of holding a certification election. That is a rather strained construction. x x x What is
required is that the petition for certification election should have in its favor the written consent of at
least 30% of all the employees in the bargaining unit. The duty then cast on the Director of Labor
Relations is to ascertain whether there has been such a compliance. There is no doubt in this case there
was evidence that more than a total of 200 signatures were obtained by respondent Union in seeking such
a certification election. The respondent Director having satisfied himself that the codal requisite had been
met, he had no choice but to order such certification. x x x There is, therefore, no basis for the contention
that a duty is cast on respondent Director to allow a rival labor organization, such as petitioner, to verify
the authenticity of such signatures.
Jose D. Dula II
Atty. Gutierrez
Labor Code became effective, previous circulars of the Secretary of Labor to take care of the transitional
stage prior to its coming into force, certainly were deemed superseded. From any standpoint then, it
cannot be gainsaid that the petition certainly lacks juridical basis. [Todays Knitting Free Workers Union
vs. Noriel, 75 SCRA 450(1977)]
Port Workers Union of the Phils. (PWUP) vs. Laguesma, 207 SCRA 329(1992)]
Labor Laws; Unions; Certification election; Implementing rules.The certification election is the most
democratic and expeditious method by which the laborers can freely determine the union that shall act as
their representative in their dealings with the establishment where they are working. As we stressed in
Belyca Corporation vs. Ferrer-Calleja, the holding of a certification election is a statutory policy that
should not be circumvented. x x x. In line with this policy, we feel that the administrative rule requiring
the simultaneous submission of the 25% consent signatures upon the filing of petition for certification
election should not be strictly applied to frustrate the determination of the legitimate representative of the
workers. Significantly, the requirement in the rule is not found in Article 256, the law it seeks to
implement. This is all the more reason why the regulation should at best be given only a directory effect.
Accordingly, we hold that the mere filing of a petition for certification election within the freedom period
is sufficient basis for the issuance of an order for the holding of a certification election, subject to the
submission of the consent signatures within a reasonable period from such filing.
Same; Same; Same; Technical rules not strictly applied.The contention that the petitioners had no right
to represent the principal petitioners which had not appealed the dismissal order is also not acceptable. We
repeat that the certification election is not a litigation but a mere investigation of a non-adversary character
where the rules of procedure are not strictly applied. Technical rules and objections should not hamper the
correct ascertainment of the labor union that has the support or confidence of the majority of the workers
and is thus entitled to represent them in their dealings with management.
Same; Same; Same; Contract-bar rule.Deviation from the contract-bar rule is justified only where the
need for industrial stability is clearly shown to be imperative. Subject to this singular exception, contracts
where the identity of the authorized representative of the workers is in doubt must be rejected in favor of a
more certain indication of the will of the workers. As we stated in Philippine Association of Free Labor
Union vs. Estrella, any stability that does not establish the type of industrial peace contemplated by the
law must be subordinated to the employees freedom to choose their real representative. [Port Workers
Union of the Phils. (PWUP) vs. Laguesma, 207 SCRA 329(1992)]
Airtime Specialists, Inc. vs. Ferrer-Calleja, 180 SCRA 749(1989)]
Attorneys; Labor Counsels should acquaint themselves with decisional law.For the present, it suffices to
call the attention of counsel to the desirability of being acquainted with applicable decisions, especially
one that strikes so close to home, even if, or perhaps more precisely when, the ruling is adverse to ones
claim. That is to live true to his duty as an officer of the court on whose trustworthiness reliance may be
placed.
Labor law; Statutory construction; A memorandum circular of the Secretary of Labor issued on September
5, 1974 cannot prevail over the provisions of the Labor Code which took effect on November 1, 1974.
Not much attention need be paid x x x to the allegation that a memorandum circular of the Secretary of
Labor dated September 5, 1974 was disregarded by respondent Director. It is true there was therein stated
that where there is a bona fide union comprising the majority voluntarily recognized and in the process of
negotiating a contract, an application for a certification election should not be entertained. In the first
place, amemorandum circular certainly cannot prevail as against the very language of the statute. That is
merely to state the obvious. In the second place, x x x from and after November 1, 1974 when the present
Labor; Certification election; Discretion should be given to the Bureau of Labor Relations in deciding
whether or not to grant a petition for certification election; Compliance with the 30% requirement (now
20%) makes it mandatory for the Bureau to order a certification election.Petitioners contentions are
untenable. It is Our holding in the case of B.F. Goodrich Phils., Inc. vs. B.F. Goodrich Confidential &
Salaried Employees Union-NATU (49 SCRA 532) that the objectives of the Industrial Peace Act would be
sooner attained if at the earliest opportunity the employees, all of them, in an appropriate bargaining unit
be polled to determine which labor organization should be its exclusive representative. This Court had
made it clear that We should give discretion to the Court of Industrial Relations, or in this case, the Bureau
of Labor Relations in deciding whether or not to grant a petition for certification election considering the
facts and circumstances of which it has intimate knowledge. Moreover, a perusal of Art. 258 of the Labor
Code as amended by Presidential Decree No. 442 reveals that compliance with the 30% requirement (now
20%) makes it mandatory upon the Bureau of Labor Relations to order the holding of a certification
election in order to determine the exclusive-bargaining agent of the employees. Stated otherwise, it means

that with such, the Bureau is left without any discretion but to order the holding of certification election.
Parenthetically, where the petition is supported by less than 30% (now 20%) the Bureau of Labor
Relations has discretion whether or not to order the holding of certification election depending on the
circumstances of the case. Thus, it is Our holding in LVN Pictures vs. Musicians Guild, et al. (1 SCRA
132) that in connection with certification election, the Court of Industrial Relations enjoys a wide
discretion in determining the procedure necessary to insure a fair and free choice of bargaining
representatives by employees, and having exercised its sound discretion, this Court cannot interfere.
(Arguelles v. Young, 153 SCRA 690).
Same; Same; In a certification election, all rank and file employees in the appropriate bargaining unit,
whether probationary or permanent, are entitled to vote; Scope of collective bargaining.In a certification
election all rank-and-file employees in the appropriate bargaining unit are entitled to vote. This principle is
clearly stated in Art. 255 of the Labor Code which states that the labor organization designated or
selected by the majority of the employees in an appropriate bargaining unit shall be the exclusive
representative of the employees in such unit for the purpose of collective bargaining. Collective
bargaining covers all aspects of the employment relation and the resultant CBA negotiated by the certified
union binds all employees in the bargaining unit. Hence, all rank-and-file employees, probationary or
permanent, have a substantial interest in the selection of the bargaining representative. The Code makes no
distinction as to their employment status as basis for eligibility in supporting the petition for certification
election. The law refers to all the employees in the bargaining unit. All they need to be eligible to
support the petition is to belong to the bargaining unit.
Same; Same; Same; The fact of alleged disaffiliation from petitioning unions in favor of another union
raised genuine representation issue which can be tested in a certification election.Even assuming the
fact of such disaffiliation and even assuming further that the 20% requirement is not reached, this will not
defeat the petition for certification election. On the contrary, it becomes more imperative to conduct one.
The alleged disaffiliation from the petitioning unions (PMA-FFW and SAMA-ASIA-FFW) in favor of the
ADLO-KMU raised a genuine representation issue which can best be tested in a certification election.
Same; Same; Same; Constitutional Law; The employees have the constitutional right to choose the labor
organization they desire to join; Nature of a certification election.The employees have the constitutional
right to choose the labor organization which they desire to join. The exercise of such right would be
rendered nugatory and ineffectual if they would be denied the opportunity to choose in a certification
election, which is not a litigation, but a mere investigation of a non-adversary character, the bargaining
unit to represent them (NAMAWUMIF vs. Estrella, 87 SCRA 84). The holding of a certification election
is a statutory policy that should not be circumvented (ATU vs. Noriel, 89 SCRA 264). [Airtime
Specialists, Inc. vs. Ferrer-Calleja, 180 SCRA 749(1989)]
Phil. Association of Free Labor Unions vs. Ferrer-Calleja, 169 SCRA 491(1989)]
Labor; Certification election; Under the law, the requisite written consent of at least 20% of the workers in
the bargaining unit applies to petitions for certification election only, and not to motions for intervention.
Considering the above provisions of law, We rule to dismiss the instant petition for certiorari. The
respondent Director did not abuse her discretion in issuing the contested order. It is crystal clear from the
said provisions that the requisite written consent of at least 20% of the workers in the bargaining unit
applies to petitions for certification election only, and not to motions for intervention. Nowhere in the
aforesaid legal provisions does it appear that a motion for intervention in a certification election must be
accompanied by a similar written consent. Not even in the Implementing Rules of the Labor Code (see
Rules V, Rules Implementing the Labor Code). Obviously, the percentage requirement pertains only to the
petition for certification election, and nothing else.
Jose D. Dula II
Atty. Gutierrez
Same; Same; Reason behind the 20% requirement in petitions for certification election; The mere fact that
20% of the workers in the bargaining unit signify their support to the petition by their written consent, it
becomes mandatory for the Med-Arbiter to order the holding of a certification election in an unorganized
establishment.This leads Us to the question of purpose. The reason behind the 20% requirement is to
ensure that the petitioning union has a substantial interest in the representation proceedings and, as
correctly pointed out by the Solicitor General, that a considerable number of workers desire their
representation by the said petitioning union for collective bargaining purposes. Hence, the mere fact that
20% of the workers in the bargaining unit signify their support to the petition by their written consent, it
becomes mandatory on the part of the MedArbiter to order the holding of a certification election in an
unorganized establishment (Samahang Manggagawa ng Pacific Mills, Inc. vs. Noriel, 134 SCRA 152).
The 20% requirement, therefore, is peculiar to petitions for certification election.
Same; Same; Intervention; Essence of the proceeding for certification election; As long as the motion for
intervention has been properly and timely filed and it did not cause injustice to anyone, it should not be
denied and even if the purpose of the motion is to participate in the certification election.ln the light of
the foregoing, KAMAPI must be allowed to participate in the certification election since the essence of
such proceeding is to settle once and for all which union is preferred by the workers to represent them
(PAFLU vs. BLR, 69 SCRA 132; PAFLU vs. BLR, 72 SCRA 396). As long as the motion for intervention
has been properly and timely filed and the intervention would not cause any injustice to anyone it should
not be denied and this is so even if the eventual purpose of the motion for intervention is to participate in
the certification election. After all the original applicant had already met the 20% requirement. [Phil.
Association of Free Labor Unions vs. Ferrer-Calleja, 169 SCRA 491(1989)]
Phil. Telegraph and Telephone Corp. vs. Laguesma, 223 SCRA 452(1993)]
Labor Law; Certification Election; Supervisory Employees; Case at Bar; Since no certified bargaining
agent represented the supervisory employees, PT&T may be deemed an unorganized establishment within
the purview of Art. 257 of the Labor Code.The applicable provision of law in the case at bar is Art. 257
of the Labor Code. It readsArt. 257. Petitions in unorganized establishments.In any establishment
where there is no certified bargaining agent, a certification election shall automatically be conducted by
the Med-Arbiter upon the filing of a petition by a legitimate labor organization (italics supplied). The
supervisory employees of PT&T did not yet have a certified bargaining agent to represent them at the time
the UNION, which is a legitimate labor organization duly registered with the Department of Labor and
Employment, filed the petition for certification election. Since no certified bargaining agent represented
the supervisory employees, PT&T may be deemed an unorganized establishment within the purview of
Art. 257 of the Labor Code.
Same; Same; Same; It is a well settled rule that an employer has no standing to question a certification
election since it is the sole concern of the workers, unless the former filed the certification election itself
pursuant to Art. 258 of the Labor Code.It is well-settled that an employer has no standing to question a
certification election since this is the sole concern of the workers. The only exception to this rule is where
the employer has to file the petition for certification election itself pursuant to Art. 258 of the Labor Code
because it was requested to bargain collectively. But, other than this instance, the choice of a collective
bargaining agent is purely the internal affair of labor. [Phil. Telegraph and Telephone Corp. vs. Laguesma,
223 SCRA 452(1993)]
Celine Marketing Corporation vs. Laguesma, 205 SCRA 849(1992)]
Labor Law; Collective Bargaining; Petitions in Unorganized Establishment; The petition for certification
election may be filed by any union, not by the employees.While it may be true that the petition for
Jose D. Dula II
Atty. Gutierrez
certification election did not carry the authorization of a majority of the rank-and-file employees of the
petitioner, their consent is not necessary when the bargaining unit that the union seeks to represent, is still
unorganized. The petition for certification election may be filed by any union, not by the employees. Thus,
Article 257 of the Labor Code, as amended by R.A. 6715, provides: "Art. 257. Petitions in unorganized
establishments.In any establishment where there is no certified bargaining agent, a certification election
shall automatically be conducted by the Med-Arbiter upon the filing of a petition by a legitimate labor
organization." The law assumes that the union is the real party in interest in a petition for certification
election. Anyway, the certification election itself is the appropriate forum for the employees to express
their choice of a bargaining representative or none at all. [Celine Marketing Corporation vs. Laguesma,
205 SCRA 849(1992)]
Same; Employer has no role in certification election except when asked to bargain collectively under the
Bystander Rule.___And finally, the Court would wish to stress once more the rule which it has
consistently pronounced in many earlier cases that a certification election is the sole concern of the
workers and the employer is regarded as nothing more than a bystander with no right to interfere at all in
the election. The only exception here is where the employer has to file a petition for certification election
pursuant to Article 258 of the Labor Code because it is requested to bargain collectively. Thus, upon the
score alone of the Bystander Rule, the instant petition would have been dismissed outright. [Philippine
Fruits and Vegetables Industries, Inc. vs. Torres, 211 SCRA 95(1992)]
Philippine Fruits and Vegetables Industries, Inc. vs. Torres, 211 SCRA 95(1992)]
Labor Law; Certification Election; Factual finding of labor officials are conclusive and binding on the
Court when supported by substantial evidence.Petitioners arguments deserve scant consideration. The
facts and circumstances extant in the record indicate that the Med-Arbiter and Secretaries Drilon and
Torres were not mistaken in holding that the three security companies are in reality a single business entity
operating as a single company called the PGA Security Group or PGA Security Services Group.
Factual findings of labor officials are conclusive and binding on the Court when supported by substantial
evidence.
Labor Law; Words and Phrases; Meaning of Close of election proceedings.As explained correctly by
the Solicitor General, the phrase close of election proceedings as used in Sections 3 and 4 of the
pertinent Implementing Rules refers to that period from the closing of the polls to the counting and
tabulation of the votes as it could not have been the intention of the Implementing Rules to include in the
term close of the election proceedings the period for the final determination of the challenged votes and
the canvass thereof, as in the case at bar which may take a very long period. Thus, if a protest can be
formalized within five days after a final determination and canvass of the challenged votes have been
made, it would result in an undue delay in the affirmation of the employees expressed choice of a
Same; One-day deficiency in giving notice of holding of certification election is insignificant where
compelling majority took part in election.Petitioner would likewise bring into issue the fact that the
notice of certification election was posted only on December 12, 1988 or four days before the scheduled
elections on December 16, 1988, instead of the five-day period as required under Section 1 of Rule VI,
Book V of the Implementing Rules. But it is not disputed that a substantial number, or 291 of 322
qualified voters, of the employees concerned were informed, thru the notices thus posted, of the elections
to be held on December 16, 1988, and that such employees had in fact voted accordingly on election day.
Viewed thus in the light of the substantial participation in the elections by voter-employees, and further in
the light of the all-too settled rule that in interpreting the Constitutions protection to labor and social
justice provisions and the labor laws and rules and regulations implementing the constitutional mandate,
the Supreme Court adopts the liberal approach which favors the exercise of labor rights, We find the lack
of one day in the posting of notices insignificant, and hence, not a compelling reason at all in nullifying
the elections.
Same; Employees who may vote in certification election.At any rate, it is now well-settled that
employees who have been improperly laid off but who have a present, unabandoned right to or
expectation of re-employment, are eligible to vote in certification elections. Thus, and to repeat, if the
dismissal is under question, as in the case now at bar whereby a case of illegal dismissal and/or unfair
labor practice was filed, the employees concerned could still qualify to vote in the elections.
Philippine Scout Veterans Security and Investigation Agency vs. Torres, 224 SCRA 682(1993)]
Same; Same; When a duly organized union files a petition for certification election, the Med-Arbiter has
the duty to automatically conduct an election.Under the amendments, there is no need for the labor
union to prove that at least 20% of the security guards in the three agencies supported the petition. When a
duly organized union files a petition for certification election, the Med-Arbiter has the duty to
automatically conduct an election. He has no discretion on the matter. This is clearly the mandate of
Article 257 of the Labor Code, as amended by Section 24 of R.A. 6715.
Same; Same; Employer has nothing to do with a certification election which is the sole concern of the
workers.Finally, except where the employer has to file a petition for certification election pursuant to
Article 258 of the Labor Code because of a request to bargain collectively, it has nothing to do with a
certification election which is the sole concern of the workers. Its role in a certification election has aptly
been described in Trade Unions of the Philippines and Allied Services (TUPAS) v. Trajano, as that of a
mere by-stander. It has no legal standing in a certification election as it cannot oppose the petition or
appeal the Med-Arbiters orders related thereto. An employer that involves itself in a certification election
lends suspicion to the fact that it wants to create a company union. [Philippine Scout Veterans Security
and Investigation Agency vs. Torres, 224 SCRA 682(1993)]
Samahan ng mga Manggagawa sa Filsystems vs. Secretary of Labor and Employment, 290 SCRA
680(1998)]
Labor Law; Certification Elections; Labor Unions; The failure of an independently registered labor union
to prove its affiliation with a labor federation cannot affect its right to file a petition for certification
election as an independent union.The reasoning of the public respondent and the Med-Arbiter is flawed,
proceeding as it does from a wrong premise. Firstly, it must be underscored that petitioner is an
independently registered labor union as evidenced by a Certificate of Registration issued by the DOLE. As
a legitimate labor organization, petitioners right to file a petition for certification election on its own is
beyond question. Secondly, the failure of petitioner to prove its affiliation with NAFLU-KMU cannot
affect its right to file said petition for certification election as an independent union. At the most,
petitioners failure will result in an ineffective affiliation with NAFLU-KMU. Still, however, it can pursue
its petition for certification election as an independent union. In our rulings, we have stressed that despite

affiliation, the local union remains the basic unit free to serve the common interest of all its members and
pursue its own interests independently of the federation.
Same; Same; Same; An appeal from an order of the MedArbiter stops the holding of any certification
election.Public respondents ruling is anchored on his finding that there exists no pending representation
case since the petition for certification election filed by the petitioner was dismissed by the Med-Arbiter.
According to the public respondent, the legal effect of the dismissal of the petition was to leave the
playing field open without any legal barrier or prohibition to any petitioner; thus, other legitimate labor
organizations may file an entirely new petition for certification election. We reject public respondents
ruling. The order of the MedArbiter dismissing petitioners petition for certification election was
seasonably appealed. The appeal stopped the holding of any certification election. Section 10, Rule V of
the Implementing Rules of Book V of the Labor Code is crystal clear and hardly needs any interpretation.
Same; Same; Same; When a petition for certification election is filed by a legitimate labor organization, it
is good policy for the employer not to have any participation or partisan interest in the choice of the
bargaining representative.We bewail private respondents tenacious opposition to petitioners
certification election petition. Such a stance is not conducive to industrial peace. Time and again, we have
emphasized that when a petition for certification election is filed by a legitimate labor organization, it is
good policy for the employer not to have any participation or partisan interest in the choice of the
bargaining representative. While employers may rightfully be notified or informed of petitions of such
nature, they should not, however, be considered parties thereto with an inalienable right to oppose it. An
employer that involves itself in a certification election lends suspicion to the fact that it wants to create a
company union. [Samahan ng mga Manggagawa sa Filsystems vs. Secretary of Labor and Employment,
290 SCRA 680(1998)]
R. Transport Corporation vs. Laguesma, 227 SCRA 826(1993)
Remedial Law; Elements of Res Judicata.Before the principle of res judicata can be operative, the
following requisites must be compresent: a) the former judgment or order must be final; b) it must be a
judgment or order on the merits; c) it must have been rendered by a court having jurisdiction over the
subject-matter and the parties; and d) there must be, between the first and second actions, identity of
parties (Nabus v. Court of Appeals, 193 SCRA 732 [1991]).
Same; Same; Labor Law; Certification Election; No identity of parties where the first action did not
include parties essential to the bargaining unit while the second action did include all the employees who
are excluded in the first action.In the case at bench, it cannot be said that the parties in the first and
second actions were identical. The first action was dismissed by the Med-Arbiter because it excluded
parties essential to the bargaining unit such as inspectors, inspectresses, dispatchers and washer boys. The
second petition included all the employees who were excluded in the first petition. Therefore, the MedArbiter was correct when he gave due course to the second petition for certification election after
respondent CLOP corrected its mistake.
Jose D. Dula II
Atty. Gutierrez
Labor Relations; Certification Election; Rule provides that no certification election may be held within
one year from the date of issuance of a final certification election result.Likewise untenable is
petitioners contention that the second petition for certification election should have been filed after one
year from the dismissal of the first petition for certification election under Section 3, Rule V, Book V of
the Omnibus Rules Implementing the Labor Code as amended. Said section provides as follows: When to
fileIn the absence of collective bargaining agreement duly registered in accordance with Article 231 of
the Code, a petition for certification election may be filed any time. However, no certification election
may be held within one year from the date of issuance of a final certification election result (italics
supplied).
Same; Same; By final certification election result is meant that an actual election, that is, ballots were
cast and there was counting of votes that was conducted.Apparently, petitioner misread the abovementioned provision of law. The phrase final certification election result means that there was an actual
conduct of election i.e., ballots were cast and there was a counting of votes. In this case, there was no
certification election conducted precisely, because the first petition was dismissed, on the ground of a
defective petition which did not include all the employees who should be properly included in the
collective bargaining unit.
Same; Same; Employees are entitled to vote in certification election regardless of the period or status of
their employment.Devoid of merit is petitioners contention that the employment status of the members
of respondent CLOP who joined the strike must first be resolved before a certification election can be
conducted. As held in the case of Philippine Fruits and Vegetables Industries, Inc. v. Torres, 211 SCRA 95
(1992): At any rate, it is now well-settled that employees who have been improperly laid off but who
have a present, unabandoned right to or expectation of re-employment, are eligible to vote in certification
elections (Rothenberg on Labor Relations, p. 548). Thus, and to repeat, if the dismissal is under question,
as in the case now at bar whereby a case of illegal dismissal and/or unfair labor practice was filed, the
employees concerned could still qualify to vote in the elections.
Same; Same; Employees who participated in the strike remain as such until their employment status is
resolved by NLRC.Therefore, the employees of petitioner who participated in the strike, legally remain
as such, until either the motion to declare their employment status legally terminated or their complaint for
illegal dismissal is resolved by the NLRC.
Same; Same; Employer has no right to interfere in the election and is merely regarded as a bystander.It
should be noted that it is petitioner, the employer, which has offered the most tenacious resistance to the
holding of a certification election. This must not be so for the choice of a collective bargaining agent is the
sole concern of the employees. The employer has no right to interfere in the election and is merely
regarded as a bystander (Divine Word University of Tacloban v. Secretary of Labor and Employment, 213
SCRA 759 [1992]).
Labor Law; Pleadings and Practice; Resort to Supreme Court without waiting for the resolution of motion
to dismiss with the Undersecretary of Labor is premature. Petitioner is guilty of forum shopping in
pursuing the same cause of action, involving the same issue, parties and subject matter between two
different fora.Finally, petitioners Comment and Objection to the Order dated October 29, 1992 with
Urgent Motion to Dismiss the Petition for Certification Election is still pending with the Undersecretary of
Labor. The resort to judicial action by petitioner is premature. Hence, it is also guilty of forum-shopping in
pursuing the same cause of action involving the same issue, parties and subject matter before two different
fora. [R. Transport Corporation vs. Laguesma, 227 SCRA 826(1993)]
Ilaw at Buklod ng Manggagawa vs. Dir. of Labor Relations, 91 SCRA 482(1979)]

Labor Law; Referral by the Director of Labor Relations to the Trade Union Congress of the Philippines
(TUCP) of an appeal to him of a certification election case is illegal and void.We hold that the referral
of the appeal to the TUCP is glaringly illegal and void. The Labor Code never intended that the Director,
of Labor Relations should abdicate, delegate and relinquish his arbitrational prerogatives in favor of a
private person or entity or to a federation of trade unions. Such a surrender of official functions is an
anomalous, deplorable and censurable renunciation of the Directors adjudicatory jurisdiction in
representation cases.
Same; Same.Article 226 of the Labor Code provides in peremptory terms that the Bureau of Labor
Relations and the labor relations divisions in the regional offices of the Ministry of Labor shall have
original and exclusive authority to act, at their own initiative or upon request of either or both parties, on
all inter-union and intra-union conflicts, and all disputes, grievances or problems arising from or affecting
labor management relations in all workplaces whether agricultural or non-agricultural, except those arising
from the implementation or interpretation of collective bargaining agreements which shall be the subject
of grievance procedure and/or voluntary arbitration.
Same; The Labor Code never intended that the original record of a labor case should be entrusted to a
private person or entity.There is another aspect of this case which should be underscored. And that is
that the Labor Code never intended that the original record of a labor case, an official public record,
should removed from the legitimate custodian thereof and entrusted to a private person or entity. It should
be obvious that the delivery of an official public record to a private person fraught with mischievous
consequences. (See sec. 27, Rule 132. Rules of Court on irremovability of public record.)
Same; The Director of Labor Relations should reconstitute its records that were given to the TUCP as
circumstances require.The petitioner and the Director could have reconstituted the record and the
Director could have decided the appeal on the basis of the reconstituted record instead of awaiting the
pleasure of the TUCPs officers for the return of the original record. [Ilaw at Buklod ng Manggagawa vs.
Dir. of Labor Relations, 91 SCRA 482(1979)]
Benguet Electric Cooperative, Inc. vs. Ferrer-Calleja, 180 SCRA 740(1989)]
Labor; Labor Unions; Cooperatives; Collective bargaining; The right to collective bargaining is not
available to an employee of a cooperative who at the same time is a member and co-owner thereof;
Employees who are neither members nor co-owners of the cooperative are entitled to exercise the rights to
self-organization, collective bargaining and negotiation.The issue of whether or not employees of a
cooperative are qualified to form or join a labor organization for purposes of collective bargaining had
already been resolved and clarified in the case of Cooperative Rural Bank of Davao City, Inc. v.
FerrerCalleja, et al. [G.R. No. 77951, September 26, 1988] and reiterated in the cases of Batangas-I
Electric Cooperative Labor Union v. Young, et al. [G.R. Nos. 62386, 70880 and 74560, November 9,
1988] and San Jose City Electric Service Cooperative, Inc. v. Ministry of Labor and Employment, et al.
[G.R. No. 77231, May 31, 1989] wherein the Court had stated that the right to collective bargaining is not
available to an employee of a cooperative who at the same time is a member and co-owner thereof. With
respect, however, to employees who are neither members nor co-owners of the cooperative they are
entitled to exercise the rights to self-organization, collective bargaining and negotiation as mandated by
the 1987 Constitution and applicable statutes.
Same; Same; Same; Same; The fact that the members-employees of the cooperative do not participate in
its actual management does not make them, eligible to form, assist or join a labor organization; It is the
fact of ownership of the cooperative, not involvement in management, which disqualifies a member from
joining any labor organization within the cooperative.The above contentions are untenable. Contrary to
Jose D. Dula II
Atty. Gutierrez
respondents claim, the fact that the members-employees of petitioner do not participate in the actual
management of the cooperative does not make them eligible to form, assist or join a labor organization for
the purpose of collective bargaining with petitioner. The Courts ruling in the Davao City case that
members of cooperative cannot join a labor union for purposes of collective bargaining was based on the
fact that as members of the cooperative they are co-owners thereof. As such, they cannot invoke the right
to collective bargaining for certainly an owner cannot bargain with himself or his co-owners.
[Cooperative Rural Bank of Davao City, Inc. v. Ferrer-Calleja, et al., supra.] It is the fact of ownership of
the cooperative, and not involvement in the management thereof, which disqualifies a member from
joining any labor organization within the cooperative. Thus, irrespective of the degree of their
participation in the actual management of the cooperative, all members thereof cannot form, assist or join
a labor organization for the purpose of collective bargaining.
Same; Same; Same; Same; Members of cooperatives have rights and obligations different from those of
stockholders of ordinary corporations; Because of the special nature of cooperatives, members-employees
cannot form or join a labor union.The above contention of respondent union is based on the erroneous
presumption that membership in a cooperative is the same as ownership of stocks in ordinary
corporations. While cooperatives may exercise some of the rights and privileges given to ordinary
corporations provided under existing laws, such cooperatives enjoy other privileges not granted to the
latter [See Sections 4, 5, 6, and 8, Pres. Decree No. 175; Cooperative Rural Bank of Davao City v. FerrerCalleja, supra.] Similarly, members of cooperatives have rights and obligations different from those of
stockholders of ordinary corporations. It was precisely because of the special nature of cooperatives, that
the Court held in the Davao City case that members-employees thereof cannot form or join a labor union
for purposes of collective bargaining.
Same; Same; Same; Certification election, null and void; Reason.It is important to note that, in her
order dated September 2, 1985, medarbiter Elnora V. Balleras made a specific finding that there are only
thirty-seven (37) employees of petitioner who are not members of the cooperative and who are, therefore,
the only employees of petitioner cooperative eligible to form or join a labor union for purposes of
collective bargaining [Annex A of the Petition, p. 12; Rollo, p. 22]. However, the minutes of the
certification election [Annex C of the Petition; Rollo, p. 28] show that a total of eighty-three (83)
employees were allowed to vote and of these, forty-nine (49) voted for respondent union. Thus, even if We
agree with respondent unions contention that the thirty seven (37) employees who were originally nonmembers of the cooperative can still vote in the certification election since they were only forced and
compelled to join the cooperative on pain of disciplinary action, the certification election held on October
1, 1986 is still null and void since even those who were already members of the cooperative at the time of
the issuance of the med-arbiters order, and therefore cannot claim that they were forced to join the union,
were allowed to vote in the election. [Benguet Electric Cooperative, Inc. vs. Ferrer-Calleja, 180 SCRA
740(1989)]
Young Men Labor Union Stevedores vs. Court of Industrial Relations, 13 SCRA 285(1965)]
Court of Industrial Relations; Jurisdiction over matters pertaining to certification election.Under
Republic Act No 875, matters pertaining to certification election involving two or more unions belong to
the exclusive jurisdiction of the Court of Industrial Relations, which will not be interfered with by the
Supreme Court unless a grave abuse of discretion is shown.
Same; Jurisdiction to prohibit illegal picketing.The Court of Industrial Relations can lawfully prohibit
the commission of illegal acts in connection with picketing in a rivalry between two unions over a
stevedoring contract.

Same; Court may order continuation of status quo pending result of certification election.The
declaration by the Court of Industrial Relations that the 50-50 arrangement concluded between the parties
in the case at bar should continue until the result of the certification election shall have become final and
executory and a collective bargaining contract entered into between the parties was held proper
considering the situation then obtaining which had resulted in many bloody incidents between the rival
unions. [Young Men Labor Union Stevedores vs. Court of Industrial Relations, 13 SCRA 285(1965)]
Jose D. Dula II
Atty. Gutierrez

Labor Relations-Compilation of Doctrines

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Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Singer Sewing Machine Company vs. Drilon, 193 SCRA 270(1991)

Vassar Industries Employees Union (VIEU) vs. Estrella, 82 SCRA 280(1978)

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

Compilation of Doctrines in Labor Relations

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Compilation of Doctrines in Labor Relations

Guijarno vs. Court of lndustrial Relations, 52 SCRA 307(1973)

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Heirs of Teodolo M. Cruz vs. Court of Industrial Relations, 30 SCRA 917(1969

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Lakas ng Manggagawang Makabayan vs. Marcelo Enterprises, 118 SCRA 422(1982)

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UST Faculty Union vs. Bitonio, Jr., 318 SCRA 185(1999)]

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Manalad vs. Trajano, 174 SCRA 322(1989)]

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Aldovino vs. National Labor Relations Commission, 298 SCRA 526(1998)

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Adamson & Adamson, Inc. vs. CIR, 127 SCRA 268(1984)

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Ferrer vs. National Labor Relations Commission, 224 SCRA 410(1993)

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Belyca Corporation vs. Ferrer-Calleja, 168 SCRA 184(1988)

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