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TUAZON, Mitchel Q.

Labor Law II 3A
01 February 2017
Atty. Azucena

A Summary and Analysis of Book V of the Labor Code

To be free, the workers must have

choice. To have choice they must retain
in their own hands the right to determine
under what conditions they will work.
-Samuel Gompers

Labor organization and collective bargaining are some of the key features of Book V of
the Labor Code which covers the topic of Labor Relations.

Book V of the Labor Code of the Philippines deals with Labor Relations, which refers to
the interactions between employer and employees or their representatives and the
mechanism by which the standards and other terms and conditions of employment are
negotiated, adjusted and enforced. Otherwise stated, the laws governing labor relations
define the status, rights, and duties and the institutional mechanisms that govern the
individual and collective interactions of employers, employees or their representatives.
Needless to say, employer-employee relationship is indispensable to labor relations for
there is no basis for organizing for purposes of collective bargaining absent such

As distinguished from Labor Standards, Labor Relations pertains to the mechanism for
negotiation and enforcement while the former is that part of labor law which prescribes
the minimum terms and conditions of employment which the employer is required to
grant its employees.

The regulatory areas set forth in Book V of the Labor Code, as amended, include: labor
organization, collective bargaining, dispute settlement, and strikes and lockouts. This
paper will primarily analyze the pertinent issues with regard to the first two (2) areas, i.e.
(a) labor organization and (b) collective bargaining.

Labor Organization

Under Department Order (D.O.) No. 40-03, a labor organization refers to any union or
association of employees in the private sector which exists in whole or in part for the
purpose of collective bargaining or of dealing with employers concerning terms and
conditions of employment. There are different classifications of labor unions in the
Philippines such as national unions or federations, independent labor unions, workers
association, etc. Evident in the definition of labor organization is its purpose which,
simply put, is to secure fair and just wages and good working conditions for the
laborers; and to protect labor against the unjust exactions of capital through the
formation of an organization.

Of course, the foundational purpose of such provision has always been recognized
under Philippine law. Article XIII, Section 3 of the 1987 Philippine Constitution provides
that the State shall guarantee the rights of all workers to self-organization. The
Constitution also provides in Section 8 of the Bill of Rights that the right of the people,
including those employed in the public and private sectors, to form unions, associations,
or societies for purposes not contrary to law shall not be abridged.

The 1974 Labor Code likewise enshrines this right under Article 211-A (b), stating It is
the policy of the State to promote free trade unionism as an instrument for the
enhancement of democracy and the promotion of social justice and development.
Clearly, labor organization is not something new to Philippine labor law, especially
considering that such concept is founded on the fundamental principles of justice, fair
play, and equity.

From a current legislative standpoint, the Labor Code, as amended, provides from
Articles 240 to 257 the laws regarding labor organization, from registration and
cancellation to rights and conditions of membership, rights of legitimate labor
organizations, and coverage. D.O. No. 40-03, as referred to above, provides for the
definitions of both labor organizations and workers associations. Also under said D.O.,
the following have been introduced: trade union combinations, multi-employer
bargaining, CBA deregistration, and interpleader/intervention. As to Articles 240 to 257
of the Labor Code, these provisions have further been reinforced and strengthened with
the enactment Republic Act (R.A.) 9481 in 2007.

Some of the provisions of said law which strengthened the workers right to self-
organization under the Constitution include: (a) the relaxation of requirements on
charter registration of union locals or chapters, (b) the eligibility of the unions of rank
and file and supervisors in an establishment to join the same national union or
federation, (c) the contraction of grounds for union registration cancellation, and (d) the
applicability of the employer bystander rule during representation disputes. While it
appears, at least on face value, that these provisions fortify the law on labor
organization, there is more than meets the eye.

For example, as to the third amendment, i.e. the contraction of the grounds for
cancellation of union registration, while it seems to be convenient to limit only to three
the grounds for cancellation so as to keep legitimate labor organizations intact, the
deletion of some of the grounds in the 1974 Labor Code appear to be inexplicable.
Removal of grounds such as (1) acting as a labor contractor or engaging in the "cabo"
system, or otherwise engaging in any activity prohibited by law; (2) entering into
collective bargaining agreements which provide terms and conditions of employment
below minimum standards established by law; and (3) asking for or accepting attorneys
fees or negotiation fees from employers, all appear to be inexplicable.
Nonetheless, it is noteworthy to consider the International Labor Organizations (ILO)
opinion on the matter, stating that the more substantive considerations involve the
constitutionally guaranteed freedom of association and right of workers to self-
organization. It added that what is involved is the public policy to promote free trade
unionism and collective bargaining as instruments of industrial peace and democracy.
More importantly, the ILO stated that an overly stringent interpretation of the statute
governing cancellation of union registration without regard to surrounding circumstances
cannot be allowed. Otherwise, it would lead to an unconstitutional application of the
statute and emasculation of public policy objectives. Worse, it can render nugatory the
protection to labor and social justice clauses that pervades the Constitution and the
Labor Code.

Collective Bargaining

Collective bargaining, on the other hand, refers to the duty or obligation to meet and
convene promptly and expeditiously in good faith for the purpose of negotiating an
agreement (Collective Bargaining Agreement, which is between the employer and the
union) with respect to wages, hours of work and all other terms and conditions of
employment including proposals for adjusting any grievances or questions arising under
such agreement and executing a contract incorporating such agreements if requested
by either party but such duty does not compel any party to agree to a proposal or to
make any concession. The purpose of collective bargaining is mainly to encourage a
democratic method of regulating the relations between the employers and employees
by means of agreements freely entered into through such collective bargaining.

Much like the provisions on labor organization, the principle and purpose behind
collective bargaining has long been acknowledged under Philippine Law.