PAPER INDUSTRIES CORP VS LAGUESMA

Facts:
Petitioner Paper Industries Corporation of the Philippines is engaged in the manufacture of paper
and timber products. PICOP-Bislig instituted a Petition for Certification Election to determine
the sole and exclusive bargaining agent of the supervisory and technical staff employees of
PICOP for collective bargaining agreement (CBA) purposes. Initial hearing was set. Paper
Industries Corp failed to file any comment or position paper. Meanwhile, private respondents
Federation of Free Workers (FFW) and Associated Labor Union (ALU) filed their respective
petitions for intervention. An Order was issued granting the petitions for interventions of the
FFW and ALU. Another Order issued on the same day set the holding of a certification election
among PICOP's supervisory and technical staff employees in with four choices, namely: (1)
PICOP Bislig Union; (2) FFW; (3) ALU; and (4) no union.

Paper Industries Corp appealed the Order which set the holding of the certification election
contending that the Med-Arbiter committed grave abuse of discretion in deciding the case
without giving the corporation the opportunity to file its comments/answer, and that PICOP-
Bislig Union had no personality to file the petition for certification election.

PICOP questioned and objected to the inclusion of some section heads and supervisors in the list
of voters whose positions it averred were reclassified as managerial employees in the light of the
reorganization effected by it.

PICOP’s contention is that the company was divided into four (4) main business groups, namely:
Paper Products Business, Timber Products Business, Forest Resource Business and Support
Services Business. A vice- president or assistant vice-president heads each of these business
groups. A division manager heads the divisions comprising each business group. A department
manager heads the departments comprising each division. Section heads and supervisors, now
called section managers and unit managers, head the sections and independent units,
respectively, comprising each department. PICOP advanced the view that considering the alleged
present authority of these section managers and unit managers to hire and fire, they are classified
as managerial employees, and hence, ineligible to form or join any labor organization.

Issue:
Whether or not the positions Section Heads and Supervisors, who have been designated as
Section Managers and Unit Managers, were converted to managerial employees under the
decentralization and reorganization program

Law:
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.

Case History:
Med-Arbiter ruled that supervisors and section heads of the petitioner are managerial employees
and therefore excluded from the list of voters for purposes of certification election.

DOLE Under Sec Laguesma issued an order declaring that the subject supervisors and section
heads are supervisory employees eligible to vote in the certification election.

Ruling:
No, they are not managerial employees. 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.
PICOP's 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.

Opinion:
I agree with the decision of the Supreme Court, 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 right granted 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.

Samahan ng mga manggagawa sa Filsystem vs Secretary of Labor

Facts:
Petitioner Samahan ng mga Manggagawa sa Filsystems (SAMAFILNAFLU-KMU) is a
registered labor union. It filed a petition for certification election among the rank-and-file
employees of private respondent Filsystems, Inc. Filsystems opposed the petition, questioning
petitioner’s status as a legitimate labor organization on the ground of lack of proof that its
contract of affiliation with NAFLU-KMU has been submitted to the Bureau of Labor Relations
within 30 days from its execution.

The Med-Arbiter dismissed the petition, ruling that petitioner has no legal personality for failure
to submit its contract of affiliation on time. Petitioner appealed to respondent Secretary,
contending that, as an independently registered union, it has the right to file a petition for
certification election regardless of its failure to prove its affiliation.
Another union, the Filsystems Workers Union, filed a petition for certification election. It was
granted, and FWU won. Private respondent filed a motion to dismiss appeal as it has become
moot & academic. Petitioner opposes the motion to dismiss on the ground that the certification
election was void for having been held during the pendency of the appeal.

Issue:
Whether or not petitioner had legal personality to file the petition ART. 256. Representation issue
in organized establishments. -In organized establishments, when a verified petition questioning
the majority status of the incumbent bargaining agent is filed before the Department of Labor and
Employment within the sixty-day period before the expiration of the collective bargaining
agreement, the Med-Arbiter shall automatically order an election by secret ballot when the
verified petition is supported by the written consent of at least twenty-five percent (25%) of all
the employees in the bargaining unit to ascertain the will of the employees in the appropriate
bargaining unit. To have a valid election, at least a majority of all eligible voters in the unit must
have cast their votes. The labor union receiving the majority of the valid votes cast shall be
certified as the exclusive bargaining agent of all the workers in theunit. When an election which
provides for three or more choices results in no choice receiving a majority of the valid votes
cast, a run-off election shall be conducted between the labor unions receiving the two highest
number of votes: Provided, that the total number of votes for all contending unions is at least
fifty percent (50%) of the number of votes cast.

At the expiration of the freedom period, the employer shall continue to recognize the majority
status of the incumbent bargaining agent where no petition for certification election is filed. (As
amended by Section 23, Republic Act No. 6715, March 21, 1989).

Law:

RA 9481 Sec. 10. Article 256 of the Labor Code is hereby amended to read as follows:

“ART. 256. Representation Issue in Organized Establishments. -In organized establishments,

when a verified petition questioning the majority status of the incumbent bargaining agent is filed
by any legitimate labor organization including a national union or federation which has already
issued a charter certificate to its local chapter participating in the certification election or a local
chapter which has been issued a charter certificate by the national union or federation before the
Department of Labor and Employment within the
sixty (60)-day period before the expiration of the collective bargaining agreement, the Med-
Arbiter shall automatically order an election by secret ballot when the verified petition is
supported by the written consent of at least twenty-five percent (25%) of all the employees in the
bargaining unit to ascertain the will of the employees in the appropriate bargaining unit.

RA 9481
To have a valid election, at least a majority of all eligible voters in the unit must have cast their
votes. The labor union receiving the majority of the valid votes cast shall be certified as the
exclusive bargaining agent of all the workers in the unit. When an election which provides for
three or more choices results in no choice receiving a majority of the valid votes cast, a run-off
election shall be conducted between the labor unions receiving the two highest number of votes:
Provided, That the total number of votes for all contending unions is at least fifty percent (50%)
of the number of votes cast. In cases where the petition was filed by a national union or
federation, it shall not be required to disclose the names of the local chapter’s officers and
members.
At the expiration of the freedom period, the employer shall continue to recognize the majority
status of the incumbent bargaining agent where no certification election is filed.

Case History:
Med-Arbiter dismissed the petition, ruling that petitioner has no legal personality for failure to
submit its contract of affiliation on time. Petitioner appealed to respondent Secretary, contending
that, as an independently registered union, it has the right to file a petition for certification
election regardless of its failure to prove its affiliation.

Ruling:
Yes, the petitioner is an independently registered labor union. As a legitimate labor organization,
its right to file a petition for certification election cannot be questioned. Reasoning Petitioner’s
failure to prove its affiliation with NAFLU-KMU will, at most, result in an ineffective affiliation.
Despite affiliation, the local union remains the basic unit free to serve the interests of its
members independently of the federation.

The certification election and the CBA are void for having occured during the pendency of an
unresolved representation case with the Secretary. Reasoning Petitioner seasonably appealed the
dismissal of its petition. The appeal stopped the holding of any certification election.

Opinion:
We reject public respondent’s ruling. The order of the Med- Arbiter dismissing petitioner’s
petition for certification election was seasonably appealed. The appeal stopped the holding of any
certification election. Section 10, Rule V of the Implementing Rules of Book V of the Labor
Code is crystal clear and hardly needs any interpretation.