Labor Law II

Rev. Fr. Romeo Dawaton

I. Labor Organizations
A. Purpose of the Formation of Labor Union
>To secure fair and just wages and good working conditions for the
laborers; and to protect labor against the unjust exactions of capital.

B. Registration and Cancellation of Labor Organizations

1. Purpose of Registration
> Registration is required to protect both labor and the public
against abuses, fraud, or impostors who pose as organizers, although
not truly accredited agents of the union they purport to represent
(PAFLU v. Sec. of Labor, 27 SCRA 40)
 2. Registration either with the SEC or DOLE
> Registration with the SEC has the effect of giving to it juridical
personality before the regular courts of justice but not to enjoy the rights
and privileges granted by law to a legitimate labor organization. It is the
registration with the BLR or the Regional Office of the DOLE, not with
the SEC that makes a union a legitimate labor organization (Phil. Land-
Air Sea Labor Union v. CIR, 93 Phil. 747)
3. Effects of Registration; Rights of a Legitimate Labor Organization
> Upon its registration, the labor organization acquires legal
personality as well as the rights and privileges granted to it by law which
are the following:
a) Right of representation – Right to representation refers to the right
of the labor union to represent the individual members;
 b) Right to be certified as the exclusive bargaining agent in
the bargaining unit – refers to the right to represent the entire
employees in the bargaining unity.
c) Right to acquire and dispose of property, real or personal,
pursuant to the purpose embodied in its constitution and bay-
laws;
d) Right to sue and be sued in its own registered name;
e) Right to engage in activities which would redound to the
welfare and benefit of the members of the union;
f) Right to be exempted from taxes;
g) Right to be furnished a copy of the employer’s audited
financial statements.
 4. Labor Organization required to register
a) Federation
b) National Union
c) Industry Union
Note: Federation or national union or Industry union refers to a group of
legitimate labor organizations in private establishments organized for collective bargaining
purposes or for dealing with employers concerning the terms and conditions of
employment of its member- unions or for participation in the formation of social and
employment policies, standards and programs and is registered with the BLR.
d) Trade Union Center – Any group of registered national unions or federations
organized for the mutual aid and protection of its members for assisting such members
in collective bargaining, or for participating in the formulation of social and employment
policies, standards and programs, and is duly registered with the BLR.
e) Independent Union – refers to a labor organization operating at the enterprise level
which acquired legal personality through independent registration under Art. 240 of the
Labor Code and Rule III, Sec. 2-A, Bk . V of the Rules to implement the Labor Code.
 5. Acquisition of legal personality under Art. 240
> The issuance of a certificate of registration to a federation,
national union, industry union or an independent union will
vest in them legal personality or legitimacy. However, a local
chapter directly created by a federation or national union
acquires legal personality under the following instances:
a) An unregistered local chapter acquires an incomplete
legal personality upon the issuance to it of a charter
certification by a federation or national union which is only
designed for one purpose, that is, to file a petition for
certification election.
 b) A local chapter acquires complete or full legal personality only upon
submission of its chapter certificate and the documents required under Art. 240-
A, infra, to the DOLE. The fact of submission, not registration to the DOLE,
signal the start of its complete status as a legitimate labor organization and as
such it could be certified as the collective bargaining agent in the company
premises.

6. Where to file applications for registration of independent labor unions.

> Applications for registration of independent labor unions, local chapters,
workers’ association shall be filed with the Regional Office where the applicant
principally operates. It shall be processed by the Labor Relations Division at the
Regional Office. Applications for registration of federation, national unions or
workers’ associations operating in more than one Region shall be filed with the
Bureau or the Regional Offices, but shall be processed by the Bureau.
 7. Requirements for registration of Labor Organization
a) Name of labor union, principal address, name of officers and addresses,
approximate number of employees in the bargaining unit it seeks to operate, with a
statement that it is not reported as a chartered local of any federation or national
union;
b) minutes of meeting and the list of employees participated in the said meeting;
c) name of all members comprising at least 20% of the employees in the
bargaining unit;
d) annual financial report if existed for one year or more unless not collected
from members;
e) constitution and by-laws, minutes of its adoption or ratification, list of
members participated. The list of ratifying members shall be dispensed with where
the constitution and by-laws was ratified or adopted during the organization meeting.
In such a case, the factual circumstances of the ratification shall be recorded in the
minutes of the organizational meeting.
 8. Requirements of affiliation of independently registered labor
organizations
a) resolution of the labor union’s board of directors approving
the affiliation;
b) minutes of the general membership meeting approving the
affiliation;
c) total number of members comprising the labor union and
the names of members who approved the affiliation;
d) certificate of affiliation issued by the federation in favor of
the independently registered labor union;
e) written notice to the employer concerned if the affiliating
union is the incumbent bargaining agent.
 9. Requirements of consolidation of labor organizations and the
supporting documents:
a) the minutes of consolidation convention of all the
consolidating labor organizations, with the list of their respective
members who approved the same; and
b) amended constitution and by-laws, minutes of its
ratification transpired in the consolidation convention or in the same
general membership meeting(s), which fact shall be indicated
accordingly.
The certificate or registration issued to a consolidated
labor organization shall bear the ratification number of one of the
consolidating labor organizations as agreed upon by the parties to
the consolidation.
 10. Registration of government employees’ organizaton
> Government employees’ organization shall register with the Civil Service
Commission and the Department of Labor and Employment. The application shall be
filed with the Bureau of Labor Relations of the DOLE which shall process the same in
accordance with the provisions of the Labor Code of the Philippines, as amended.
Applications for registration may also be filed with the Regional Office of the DOLE
which shall immediately transmit the said application to the BLR within 3 days from
receipt thereof.
> Upon approval of the application, a registration certificate shall be issued to the
organization recognizing it as a legitimate employees’ organization with the right to
represent its members and undertake activities to further and defend its interests. The
corresponding certificate of registration shall jointly approved by the Chairman of the
CSC and the Secretary of the DOLE
The registered employees’ organization having the support of the majority of
the employees in the appropriate organizational unit shall be designated as the sole
and exclusive representative of the employees.
 11. Local chapter directly created by the federation or national
union
> A duly registered federation or national union may directly
create a local chapter by issuing a charter certificate indicating
the establishment of the local chapter. The chapter shall acquire
personality only for purposes of filing a petition for certification
election from the date it was issued a charter certificate.
In addition to its charter certificate, the local chapter shall be
entitled to all the rights and privileges of a legitimate labor
organization only upon submission of the following documents:
a) the names of the chapter’s officers, their addresses, and the
principal office of the chapter;
 b) The chapter’s constitution and by-laws; provided that where the chapter’s
constitution and by-laws are the same as that of the federation or the national
union, this fact shall be indicated accordingly.
The foregoing supporting documentary requirements should be certified
under oath by the secretary or treasurer of the local chapter and attested to by its
president. They are mandatory in nature without which, the local chapter does
not become a legitimate labor organization.
The Issuance of a charter certificate by the federation or national union is
only for purposes of certification election and not to clothe the local chapter with
complete legal personality. However, the moment copies of the charter certificate
and the documentary requirements were submitted to the BLR or Regional Office
of the DOLE, the local chapter acquires complete and full personality. It is the act
of submission of the charter certificate and the required documents under Art. 241
for the local chapter to acquire full legal personality. It need not be independently
registered to acquire legal personality.
 12. Disaffiliation – When affiliated, a local union may disaffiliate from the
federation.
12.1. When to disaffiliate
GR: A labor union may upon disaffiliation from the mother union to form
an independent union only during the 60-day freedom period immediately
preceding the expiration of the CBA.
XPN: Disaffiliation by majority – even before the onset of the freedom
period, disaffiliation may still be carried out, but such disaffiliation must be
effected by a majority of the union members in the bargaining unit.
This happens when there is a substantial shift in allegiance on the part of
the majority of the members of the union. In such a case, however, the CBA
continues to bind the members of the new or disaffiliated and independent
union up to the CBA’s expiration date. A consent election to determine the
union which shall administer the CBA may be conducted.
 12.2. Manner of disaffiliation
An affiliate may disaffiliate from a labor federation or national union
upon the written resolution approved by majority of the total membership
adopted at a general membership meeting called for the purpose.

12.3. Local Union Disaffiliate to join New Federation

When a local union withdraws from the old federation to join a new
federation, it is merely its primary right to labor organization for the effective
enhancement and protection of common interests.

12.4. Limitation
Disaffiliation should be in accordance with the rules and
procedures stated in the constitution and by-laws of the federation
 A prohibition to disaffiliate in the federation’s constitution
and by-laws is valid. It is intended for its own protection.
The issue of disaffiliation is an inter-union conflict the
jurisdiction of which properly lies with the BLR not with the Labor
Arbiter.

12.4. Substitutionary Doctrine

The CBA continues to bind the members of the new or
disaffiliated and independent union up to the CBA’s expiration date.
The Doctrine provides that the employees cannot revoke
the validity of executed CBA contract with their employer by the
simple expedient act of changing their bargaining agent.
 12.5. Revocation of Charter by the Federation
By serving the local/chapter a verified notice
of revocation, copy furnish the Bureau on the ground
of disloyalty or such other grounds as may be
specified in its constitution or by-laws. All requisite
documents and papers shall be under oath by the
secretary or the treasurer of the organization, as the case
maybe, and attested to by its president.
 12.6. Mandamus, not certiorari, is proper remedy
The proper remedy against refusal to register a
labor organization which complies with all the
requirements is Mandamus and not certiorari.
Certiorari is not the proper remedy since the approval of
application for registration is not a judicial function.
 13. Denial of Registration; Appeal
13.1. The decision of the Regional Office or the Bureau denying the
application for registration shall be:
1) In writing;
2) Stating in clear terms the reason for the decision; and
3) Applicant union must be furnished a copy of said decision.
13.2. Appeal (D.O. 40-03)
1) Cases from the Regional Office
The decision of the Regional Office shall be appealed to the
BLR.
The decision of the BLR on cases appealed from the Regional
Director (appealed jurisdiction) are final and not appealable to the
Secretary of Labor (Sec. 16)
 2) Cases from the BLR
The decision of the BLR in the exercise of hi/her original
jurisdiction may be appealed to the Secretary of Labor (Sec. 16)

Appeal from the Decisions of the BLR/SOLE

Any applicant union may appeal (1) to the Bureau the denial of
registration by the Regional Office, or (2) to the Secretary if the
denial is by the Bureau, within ten (1) calendar days from receipt of
such decisions on grounds of:
a) Grave abuse of discretion; and
b) Gross incompetence.
 14. Cancellation of Registration
> Subject to the requirements of notice and due process, the registration of
any legitimate labor organization or workers’ association may be cancelled by
the Bureau or the Regional Office upon the filing of an independent petition
for cancellation.

14.1. Grounds for Cancellation

a) Misrepresentation, false statement or fraud in connection with the
adoption or ratification of the constitution and by-laws or amendments
thereto, the minutes of ratification, and the list of members who took part in
the ratification;
b) Misrepresentation, false statement or fraud in connection with the
election of officers, minutes of the election of officers, the list of voters;
c) Voluntary dissolution by the members.
 14.2. Cancellation of registration certificate; its effect
> Cancellation of certificate of registration would not entail a dissolution of
said association or its suspension. The existence of the union would not be
affected by said cancellation, although its juridical personality, statutory rights
and privileges would be suspended thereby (PAFLU v. Sec. of Labor,27 SCRA 40)

14.3. Effect of Cancellation of Federation on its Locals or Chapters

> The cancellation of registration of a federation or national union shall
operate to divest its locals/chapters of their status as legitimate labor
organizations. For a local chapter, it shall acquire legal personality only for
purposes of filing a petition for certification election from the date it was issued a
charter certificate by a duly registered federation. However, it shall be entitled to
all rights and privileges of a legitimate labor organization only upon submission
of the required document in addition to its charter certificate.
 15. Coverage and Employees’ Right to Self-Organization
a) To form, join and assists labor organizations for the
purpose of collective bargaining through representatives of
their own choosing; and
b) To engage in lawful concerted activities for the same
purpose or for their mutual aid and protection.

15.1. Right to Organize cannot be bargained away.

The right to self-organization must be upheld in the
absence of express provision of law to the contrary. It cannot
be curtailed by a CBA.
 15.2. Right to join Start from First day of employment.
Any employee, whether employed for a definite period or not, shall,
beginning on the first of his/her service, be eligible for membership in any
labor organization.

15.3. Persons/Employees Eligible to join a Labor Organization for Purposes of

CBA
a) All persons employed in commercial, industrial and agricultural
enterprises, including employees of Government-owned or controlled
corporation without original charters established under the corporation code;
b) In Religious, charitable, medical or educational institutions whether
operating for profit or not; and
c) Employees of Government-owned and controlled corporations without
original charters.
 15.4. Persons/Employees Eligible to join a labor
organization for mutual aid and protection
a) Ambulant (Walking or mobile workers);
b) Intermittent (Irregular workers);
c) Rural;
d) Self-employed people
e) Itinerant workers (working for a short time in
various places); and
f) Workers without any definite employers
 15.5. Persons/Employees who are not granted the right to self-organization
a) Employees of International Organization such as UN, IRRI and International
Catholic Migration Commission;
b) Members of the AFP, including police officers, policemen, firemen and jail
guards;
c) Managerial employees:
c.a) Whose functions are normally considered as policy- making or managerial;
c.b) Whose duties are of a highly confidential or highly technical in nature;
d) confidential employees;
e) High-level or managerial government employees
f) Alien without valid working permits; or aliens with valid working permits but
are nationals of a country which do grant Filipinos to exercise the right of self-
organization and to join or assist labor organization;
 g) Non-employees
h) Government employees, including government-
owned And controlled corporations with original
charter;
i) Employees of cooperatives who are at the same
time its members. However, they may form a worker’s
association;
j) Subversive or those engaged in subversive activites.
 16. Eligibility of Foreigners to form Labor Organization (Principle of Reciprocity)
Alien working in the country with valid permits issued by DOLE may exercise the
right to self organization and join or assist labor organizations of their own choosing
for purposes of collective bargaining; provided, that said aliens are nationals of a
country which grants the same or similar rights to Filipino workers;

17. Religious Objectors

> The rights of the members of the Iglesia ni Kristo sect not to join a labor
union for being contrary to their religious beliefs does not bar members of that sect
from forming their own union. The recognition of the tenets of that sect should not
infringe on the basic right to self-organization granted by the constitution to workers
regardless of religious affiliation ( Kapatiran sa Meat and Canning Div. [Tupas Local
Chapter No. 1027] v. Ferrer-Calleja, G.R. No. 82914 June 20, 1988).
In fact, they can vote for “No-Union” in a certification election in the exercise of
their right to self-organization (Reyes v. Trajano. G.R. No. 84433, June 2, 1992).
 16. Voluntary Recognition
> A duly registered employees’ organization shall be
accorded voluntary recognition:
a) Upon a showing that no other employees’
organization is registered or is seeking registration,
based on records of the Bureau of Labor Relations; and
b) The said organization has the majority support of
the rank-and-file employees in the organizational
unit.
 17. Certification Election
> Where there are two or more duly registered
employees’ organizations in the appropriate
organizational unit, the BLR, upon petition, shall:
a) order the conduct of a certification election; and
b) Certify the winner as the exclusive representative
of the rank-and-file employees in the said
organizational unit.
 18. Run-off Election
> in cases where there are at least three (3)
contending organizations and none received a majority
of the valid votes cast. Only the two (2) registered
employees organizations receiving the largest and
second largest number of votes in the first voting shall
be voted on.
 19. Ineligibility of Managerial Employees to join any Labor Organization
19.1. Managerial Employees are those who are vested with powers or prerogatives
to lay down and execute managerial policies and/or to hire, transfer, suspend, lay-
off, recall, discharge, assign or discipline employees.

19.2. Reason for Ineligibility

> Managerial employees are the alter ego of the employers and thus they are
suppose to be on the side of the employer to act as his representatives, and to see to
it that its interests are well protected. The employer is not assured of such
protection if these employers are union members.
In the same manner, the labor union might not be assured of their loyalty to the
union in view of the evident conflict of interest. The union can also become
company-dominated with the presence of managerial employees in union
membership ( Bulletin Publishing Co. Inco. V. Hon. Sanchez, G.R. No. 74425, Oct.
7, 1986)
 19.3. Types of Managerial Employees
a) First-Line Managers (often called supervisors)- direct the
operation of employees only and do not supervise other managers
(e.g. foreman, production supervisor in a manufacturing plant).
b) Middle Managers – direct the activities of other managers
and also operating employees (e.g. Plant manager in an electronic
firm).
c) Top Managers – Responsible for the over-all management of
the organization (e.g. CEO, president, SVP).
Among the three types, only the firs-lne managers or
supervisors can join, assist or form union.
 19.4. Supervisory Employees May form, assist, join Labor
Organization.
Supervisory Employees May form, Assist, Join a labor
organization on their own and not with the rank-and-file
employees.
If their responsibilities do not in require the exercise of
discretion and independent judgment (or merely routinary/
clerical in nature), then they may join the union composed of the
rank-and-file employees.
The rank-and-file union and the supervisors’ union operating
within the same establishment may join the same federation or
national unon.
 19.5. Confidential Employees
> Assist and act in a confidential capacity, 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 manegerial employees to form, assist or join a labor
union equally applies to them (Philips Industrial development, Inc.
v. NLRC, G.R. No. 88957, June 25, 1992).
Confidential employees are 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.
v. Roldan-Confesor, G.R. No. 108855, Febr. 28, 1996).
 > The two criteria are cumulative, and both must be met if
an employee is to be considered a confidential employee – e.g.,
the confidential relationship must exist between the employee
and his supervisor, and the supervisor must handle the
prescribed responsibilities relating to labor relations. As such,
the rationale behind the ineligibility of managerial employees to
form, assist or join a labor union equally applies to them.
Every managerial position is confidential because one does
not become a manager without having gained the confidence of
the appointing authority. But not every confidential employee is
managerial, he may be a suprevisory or even a rank-and-file
employee.
 19.6. Effect of Inclusion as Members of Employees Outside the
Bargaining Unit
> The inclusion as union members of employees outside the
bargaining unit shall not be a ground for cancellation of the
registration of the union. Said employees are automatically
deemed removed from the list of membership of said union.
Reason: After a certificate of registration is issued to a union,
its legal personality cannot be subject to a collateral attack. It may
be question only via a petition for cancellation, under the ground
provided for in Art. 246 (Tagaytay Highlands International Golf
Club Inc. v. Tagaytay Highlands employees Union, G.R. No.
142000, January 22, 2003).
II. Unfair Labor Practice
A. Elements of ULP
1. Employer-employee relationship between the offender and the offended; and
2. Act done is expressly defined in the code as an act of ULP.

B. ULP of Employer
1. Interference – to interfere with, restrain or coerce employees in the exercise of their right to self-
organization.
2. Yellow Dog Condition – requires as a condition for employment that a person or an employee shall
not join a labor organization or shall withdraw from one to which he belongs.
Yellow Dog Contract is a promise exacted from workers as a condition of employment that they are
not belong to, or attempts to foster, a union during their period of employment. It is null and void
because:
a) It is contrary to public policy for it is tantamount to involuntary servitude;
b) It is entered into without consideration for employees in waiving their right to self-
organization; and
c) Employees are coerced to sign contracts disadvantageous to their family.
 3. Contracting out – means to contract out services or functions being
performed by union members when such will interfere with, restrain or
coerce employees in the exercise of their right to self-organization.

4. Company-Domination of Union – means to initiate, dominate,

assist or otherwise interfere with the formation or administration of any
labor organization, including the giving of financial or other support to
it or its organizers or officers.

5. Discrimination – with regard to wages, hours of work, and other

terms and conditions of employment in order to encourage or
discourage membership in any labor organization.
 5.1. Three components of Discrimination
a) It prohibits discrimination in terms and conditions of employment in order to
encourage or discourage membership in the union;
b) It gives validity to union security agreements; and
c) It allows and agency shop arrangement whereby agency fees may be collected
from non-union members.

6. Discrimination because of Testimony – To dismiss, discharge or otherwise prejudice

or discriminate an employee who is about to give or has given a testimony under this code.
Subject matter of Testimony: it can be anything under the Code.
What is considered as ULP is the employer’s retaliatory act regardless of the subject
of employee’s complaint or testimony. In effect, if the retaliatory act is done under Art.
118, the consequence is ULP under Art. 254 (f ).
Note: This is the ULP not required to be related to employee’s exercise of the right to
self-organization and collective bargainng.
 7. Violation of Duty to Bargain
7.1. Acts are held to constitute refusal to bargain:
a) Alleging that the union is irresponsible;
b) Transferring operation to elude the union; (Run-Away Shop);
c) Delaying negotiations by discussing unrelated matters;
d) Rejecting a union’s offer to prove its majority claim;
e) Engaging in Surface Bargaining;
f) Refusal to make a counter proposal to the union’s proposal for CBA
negotiation;
g) closure of the business and subsequent opening of the same in bad faith
for the purpose of circumventing the Union’s right to collective bargaining;
h) Employer proceed to negotiate with a splinter union despite the existence
of its valid CBA with the duly certified and exclusive bargaining agent.
 Run-away shop – is an unfair labor practice of
management which usually takes place by effecting the transfer
of ownership, the plant itself, or its equipment, or by
temporarily closing its business purposely to bust the union or to
evade the payment of legitimate obligations (Complex Electronics
Employees Association v. NLRC, G.R. No. 121315, July 19, 1999).
Surface Bargaining - means going through the motions
of negotiating without any legal intent to reach an agreement. It
involves the question of whether or not the employer’s conduct
demonstrates an unwillingness to bargain in good faith or is
merely hard bargaining (Standard Chartered Bank Employees
Union v. Confesor, G.R. No. 114974, June 16, 2004).
 8. Paid Negotiation
> To pay negotiation or attorney’s fees to the union
or its officers or agents as part of the settlement of any
issue in collective bargaining or any other disputes.

9. Violation of CBA
> The violation must be gross, flagrant and/or
malicious refusal to comply with the economic provision
 C. Different Kinds of Union Security Arrangements (Exceptions to ULP on
Interference on the Employees’ Right to Self-Organization)
1. Closed-Shop Agreement
Only union members can be hired by the company and they must remain
as union members to retain employment in the company.
Exceptions:
a) Employees belonging to any religious sect which prohibit affiliation of
their members with any labor organization are not covered by such agreement.
The free exercise of religious belief is superior contract rights.
b) Members of the rival union are not covered by such arrangement;
c) Confidential employees excluded from rank and file bargaining unit; and
d) Employees excluded by express term of the agreement
 2. Union Shop Agreement
Non-members may be hired but to retain employment, must
become union members after a certain period.
3. Maintenance of Membership Shop Agreement
No employees is compelled to join the union, but all present or
future members must, as a condition of employment remain in good
standing in the union.
4. Preferential Shop Agreement
Is an agreement whereby the employer merely agrees to give
preference to the members of the bargaining union in hiring, promotion
or filing vacancies and retention in case of lay-off. The employer has
the right to higher from the open market if union members are not
available.
 5. Agency Shop Agreement or Maintenance of Treasury Shop
is an agreement whereby employees must either join the union or
pay to the union as exclusive bargaining agent a sum equal to that paid by
the members.
6. Modified Union Shop
Employees who are not members at the time of signing the contract
need not join the union, but all the workers hired thereafter must join.
7. Exclusive Bargaining Shop
Provides that the union is recognized as the exclusive bargaining agent
for all employees in the bargaining unit, whether union members or not.
8. Bargaining for Members only
Provides that the union is recognized as the bargaining agent only for
its own members.
 C. ULP of Labor Organizations
1. To grossly violate a CBA
2. To Refrain or coerce employees in the exercise of their right to self-
organization. However, a labor organization shall have the right to prescribe its
own rules with respect to the acquisition or retention of membership.
3. To ask for or accept negotiation or attorneys fees from employers as part
of the settlement of any issue in collective bargaining or any other dispute.
4. To cause or attempt to cause an employer to discriminate against an
employee, including discrimination against an employee with respect to whom
membership in such organization has been denied or to terminate an
employee on any ground other than the usual terms and conditions under
which membership or continuation of membership is made available to other
members.
 5. To cause or attempt to cause an employer to pay or deliver
or agree to pay or deliver any money or other things of value in
the nature of an execution, for services which are not
performed or not to be performed, including the demand for a
fee for union negotiations.
Featherbedding –refers to the practice of the union or its
agents in causing or attempting to cause an employer to pay or
deliver or agree to pay or deliver money or other things of
value, in the nature of exaction, for services which are not
performed, as when a union demands that the employer
maintain personnel in excess of the latter’s requirements.
 6. To violate the duty or refuse to bargain collectively with the
employer provided that it the representative of the employees.
Sweetheart Doctrine – Provides that it is ULP for a labor
organization to ask for or accept negotiation or attorneys fees
from the employer in settling a bargaining issue or dispute.
Blue-Sky Bargaining – Making exaggerated or
unreasonable proposals. Whether or not the union is engaged in
blue-sky bargaining is determined by the evidence presented by
the union as to its economic demands. Thus, if the union
requires exaggerated or unreasonable economic demands, it is
guilty of ULP.
III. Collective Bargaining and Administration of Agreements
A. Concept and Purpose of Collective Bargaining
1. Concept of Collective Bargaining
> The Code defines “to bargain collectively” as the performance of a mutual
obligation to meet an confer promptly and expeditiously and 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
grievances or questions arising under such agreement and executing a contract
incorporating such agreement if requested by either party but such duty does not
compel any party to agree to a proposal or to make any concession (Art. 263)
Thus, a CBA refers to a contract executed upon request of either the employer or
the exclusive bargaining representative incorporating the agreement reached after
negotiation with respect to wages, hours of work and all other terms and conditions
of employment, including mandatory provisions for grievance and arbitration
machineries (Davao Integrated Stevedoring Services v. Abarquez, 220 SCRA 197)
 2. Purpose of Collective Bargaining
> To encourage a truly democratic method of regulating the relations
between the employers and employees by means of agreements freely entered
into through collective bargaining.

B. Requisites of Collective Bargaining

1. Possession of the status of representation by 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 (Certification of the BLR that the
representative of the employees is the sole and exclusive bargaining agent
having won in a certification
election)
 3. Employer-employee relationship
> The duty to bargain collectively arises only between the
employer and its employee. Where neither party is an
“employer” nor an “employee” of the other, no such duty
would exist (Allied Free Worker’s Union v. Compania
Maritima, G.R. Nos. L-122951-52, January 31, 1967); and
4. Demand to bargain under Art. 250[a] of the Labor Code.
Note: Where a majority representative has been
designated, it is an ULP for the employer, as a refusal of
collective bargaining, to deal and negotiate with the minority
representative to the exclusion of the majority representative.
 Certification Year – If the jurisdictional preconditions
are present, the collective bargaining should begin with
the 12 months following the determination and certification
of the employee’s exclusive bargaining representative. This
period is “certification.”

Zipper Clause – is a stipulation in a CBA indicating that

issues that could have negotiated upon but not contained
in the CBA cannot be raised for negotiation when the CBA
is already in effect.
C. Procedure in Collective Bargaining
1. When a party desires to negotiate an agreement, it
shall serve a written notice upon the other party with a
statement of proposals;
2. Reply by the other party within ten calendar days with
counter proposals;
3. In case of differences, either party may request for a
conference which must be held within ten calendar days
from receipt of request;
 4. If not settled, NCMB may upon request of either or
both parties or at its own initiative and encourage the
parties to submit the dispute to a voluntary arbitrator;
5. If not resolved, the parties may go to where they want
and report to any other lawful means(either to settle the
dispute or submit it to voluntary arbitrator)
D. Kinds of Bargaining
1. Single Enterprise – Involves negotiation between one
certified labor union and on employer.
2. Multi-employer Bargaining (MEB) – Involves negotiation
between and among several labor unions and employers.

E. Registration Requirements
>The original and two duplicate copies of the following must
be verified under oath by the representative(s) of the
employer(s) and union(s):
1. CBA;
 2. A statement that the CBA was posted in at least two
conspicuous places in the establishment or
establishments concerned for at least five days before its
ratification; and
3. A statement that the CBA was ratified by the
majority of the employees in the bargaining unit of the
employer or employees concerned.
F. Mandatory Provisions of the CBA
1. Wages;
2. Hours of work;
3. Vacations and Holidays;
4. Bonuses;
5. Pensions and retirement plans;
6. Seniority;
7. Transfer
8. Lay0offs;
9. Employee Workloads;
 10. Work rules and Regulations;
11. Rent of Company houses;
12. Union security arrangements;
13. Grievance machinery;
14. Voluntary arbitration;
15. Family planning;
16. Rates of Pay;
17. Mutual observance clause;
18. Provision against Drug Use in Workplace
Note: Employer’s duty to bargain is limited to mandatory bargaining
subjects; as to other matters, he is free to bargain or not to bargain.
G. Meaning of Duty to Bargain Collectively:
1. Where no CBA Exists
The performance of a mutual obligation:
1.1. To meet and convene promptly and expeditiously in good faith for the purpose of
negotiating and agreement 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
1.2. To execute a contract incorporating such agreements if requested by either party.
Limitations:
1.2.1. The duty to bargain collectively does not compel any party to:
a) Agree to a proposal;
b) Make a concession; or
c) Make room for “take it or leave it” posture
1.2.2. The parties cannot stipulate terms and conditions of employment which are
below the minimum requirements prescribed by law.
 2. When CBA exists:
GR: When there is an existing CBA, the duty to bargain shall
also mean that neither party shall terminate nor modify such
agreement during its lifetime. It is the duty of both parties to:
2.1. Keep the status quo; and
2.2. To continue in the full force and effect the terms and
conditions of the existing CBA.
XPN: During the 60-day period prior to its expiration, upon
service of a written notice of a party’s intention to
terminate or modify the same, a party may choose to terminate
or modify the non-representational aspect of the CBA only after
the expiration of CBA of fixed duration.
 Contract-bar rule – The existence of a CBA duly
certified by the BLR serves as a bar to the filing of a
petition for certification election or a motion for
intervention except within the freedom period or 60-day
prior to the expiry date of the agreement, the purpose of
the rule being to ensure stability in the relationship of
the workers and the management by preventing frequent
modifications of any CBA earlier entered into by them in
good faith and for the stipulated original period (TUCP v.
Ferrer-Calleja, G.R. No. 89609, January 27, 1992)
 Automatic Renewal Clause – The CBA shall remain effective
and enforceable even after the expiration of the period fixed by
the parties as long as no new agreement is reached by them.
Reason: To avoid or prevent a situation where no collective
bargaining agreement at all would govern between the employer
company and its employees.
Note: The Automatic Renewal pertains only to the economic
provisions of the CBA and does not include representational
aspect of the CBA (PICOP Resources, Inc. v. Dequilla, G.R. No.
172666, Dec. 7, 2011)
Freedom Period – is the 60-day period immediately preceding
the expiration of the repr esentation period of 5 years in the CBA.
H. Four Forms of ULP in Bargaining
1. Bad faith in the bargaining (boulwarism), including failure
or refusal to execute the CBA, if requested; and
2. Evading the mandatory subjects of bargaining;
3. Gross violation of the CBA; and
4. Failure or refusal to meet and convene.
Note: Violations of the Collective bargaining agreement,
except those which are gross in character, shall no longer be
treated as an unfair labor practice but as a grievance under the
collective bargaining agreement (Silva v. NLRC, G.R. No.
110226, June 19, 1997).
 I. What may be done during the 60-day freedom period
1. All labor union may disaffiliate from the mother union to form a local union or
independent union only during the 60-day freedom period immediately preceding the
expiration of the CBA.
2. Either party can serve a written notice to terminate or modify the agreement to at least 60
days prior to its expiration period.

Successor-in-interest Doctrine
GR: When an employer with an existing CBA is succeeded by another employer, the
successor-in-interest who is a buyer in good faith has no liability to the employees in
continuing employment and the CBA because these contracts are in personam.
XPN:
1. When the successor-in-interest expressly assume the obligation;
2. The sale is a device to circumvent the obligation;
3. The sale or transfer is made in bad faith; or
4. When there is a bona fide sale but any of the following circumstances are present:
 a) Where the transaction amounts to merger or
consolidation;
b) Transfer of assets and employees leaves intact the
identity of the employing business.
c) Where the purchaser acted in collusion with the
transferring corporation to evade responsibility to
bargain with the employees (sale in bad faith);
d) Where the purchaser merely continues the
business of the transferring corporation; or
e) Where there is express or implied agreement.
 Substitutionary Doctrine
> Where there occurs a shift in the employees’ union allegiance
after the execution of a collective barfgaining contract with the
employer, the employees can change their agent (the labor union)
but the collective bargaining contract which is still subsisting
continues to bind the employees up to its expiration date.
The employees cannot revoke the validity executed collective
bargaining contract with their employer by the simple expedient of
changing their bargaining agent. The new agent must respect the
contract (Benguet Consolidated, Inc. v. BCI Employees and
workers Union-PAFLU, G.R. No. L-24711, April 30, 1968)
J. Terms of CBA
1. Duration of CBA
1.1. With respect to the representation aspect, the same lasts for 5
years
A Petition for certification election, which resolves the
representation aspect, may be entertained and a certification
election may be conducted within the 60-day period immediately
prior to the expiration of such 5-year term of the CBA.
1.2. With respect to other provisions (economic and Non-
economic), the same may last for a maximum period of 3 years after
the execution of the CBA. Hence, may be renegotiated not later
than 3 years.
2. Economic Provision may include:
2.1. Wages
2.2. Family planning;
2.3. Effectivity of the agreement; or
2.4. Other terms and conditions of employment

3. Non-economic provisions may include

3.1. Coverage of the bargaining unit;
3.2. Union Security Clauses;
3.3. Management prerogatives right or responsibilities of employees;
3.4. Grievance machinery and voluntary arbitration; and
3.5. No strike no lock-out provision.
 4. Effectivity and Retroactivity of other Economic Provisions of
the CBA
4.1. If CBA is the very first for the bargaining unit, the parties
have to decide the CBA’s effectivity date;
4.2. Those made within 6 months after the date of expiry of the
CBA are subject to automatic retroaction to the day immediately
following such date of expiry;
4.3. Those not made within 6 months, the parties may agree on
the date of retroaction.
This rule applies only if there is an existing agreement. If there
is no existing agreement, there is no retroaction effect because the
date agree upon shall be the start of the period of agreement.
K. Petition for Certification Election
1. Petitions in unorganized Establishments
> An unorganized establishment is a company or firm
where there is no recognized or certified collective
bargaining agent in the company premises. Despite the
existence of some unions in a firm or company, it is still
treated as unorganized establishment if no one among
the union is certified as the sole and exclusive bargainign
agent of the employees in the bargaining unit.
 1.1. The following legitimate labor organizations may
file a petition for certification election in an unorganized
establishment:
a) An independent union;
b) A national union or federation which has already
issued a charter certificate to its local chapter
participating in the certification election; or
c) A local chapter which has been issued a charter
certificate by the national union or federation.
 1.2. Automatic Certification Election Rule
> In a petition filed by any legitimate labor
organization in an unorganized establishment, the Med-
Arbiter is required to automatically order the conduct of
certification election upon filing of a certification
election by a legitimate labor organization even without
the 25% support of the employees in the bargaining unit
which is not required in unorganized establishment.
 2. Mandatory Certification Election

A certification election shall be conducted in any of the following

instances:
2.1. Under Art. 268 – In organized establishments, a petition for
certification election can be filed, questioning the majority status of
the incumbent bargaining agent;
2.2. Under Art. 269 – In an unorganized establishment, a petition
for certification election can be filed and it shall automatically be
conducted by the Med-Arbiter; and
2.3. Under Art. 270 – When requested to bargain collectively, an
employer may file a petition for certification election.
 3. Petition for Certification Election filed by an
Employer
> A certification election is the sole concern of the
workers and the employer is regarded as nothing more
than a bystander with right to interfere at all in the
election, the only exception being where the employer
has to file a petition for certification election because it
is requested to bargain collectively.
 4. Employer as bystander
> Whether the petition for certification election is filed by
an employer or a legitimate labor organization, the employer
shall not be considered a party thereto with a concomitant to
oppose a petition for certification election. The participation
of the employer is limited to the following:
4.1. To be notified or informed of the filing of the petition
for certification election; and
4.2. To submit the list of employees during the pre-
election conference, in case the Med-Arbiter acts favorably
on the petition by giving due course to it.
 5. Factors in determining the Appropriate bargaining unit
5.1. Community of Interest Doctrine or Substantial Mutual Interest
Rule – characterized by the similarity of employment status, same
duties and responsibilities and substantially similar compensation
and working conditions;
5.2. Globe Doctrine – based on the express will or desire of the
employees;
5.3. Employment status, such as:
a) Temporary
b) Seasonal; and
c) Probationary employees
5.4. Prior collective bargaining history
6. Grounds for Dismissal or Denial of the Petition for Certification
Election
6.1. Petition is not listed in the department’s registry of legitimate
labor unions or that its legal personality has been revoked or
cancelled with finality;(Unregistered Union)
6.2. Petition was filed before or after the freedom period of a duly
registered CBA; provided that the 60-day period based on the
original CBA shall not be affected by any amendment, extension,
or renewal of the CBA; (Contract Bar Rule)
6.3. Petition was filed within 1 year from entry of voluntary
recognition or a valid certification, consent, or run-off election and
no appeal on the results thereof is pending; (Certification Year)
 6.4. A duly certified has commenced and sustained
negotiations with the employer or there exists a
bargaining deadlock which has been submitted for
conciliation or arbitration or had become the subject of
a valid notice of strike or lockout to which an incumbent
or a certified bargaining agent is a party;
6.5. In case of an organized establishment, failure to
submit the 25% support requirement for the filng of the
petition for certification election;
 6.6. Failure of the local/chapter or national
union/federation to submit a duly issued charter certificate
upon filing of the petition for certification election;
6.7. Absence of employer-employee relationship
between all the members of the petitioning union and the
establishment where the proposed bargaining unit is
sought to be represented; and
6.8. Non-appearance of the petitioner for two-
consecutive scheduled conference before the mediator-
arbiter despite due notice (D.O. 40-F-03)
 7. Conduct of Certification Election
7.1. Certification of Collective Bargaining Agent
> The union which obtained a majority of the valid votes cast
shall be certified as the sole and exclusive bargaining agent of
the all the employees within 5 days from the day of the election
provided no protest is recorded in the minutes of the election.

7.2. Failure of Election

> When the number of votes cast in a certification or
consent election is less than the majority of the number of
eligible voters and there are no material challenged votes.
 7.3. Effect of Failure of Election
> It shall not bar the filing of a motion for the immediate
holding of another certification or consent election within 6
months from the date of declaration of failure of election.

7.4. Proclamation and Certification of the Result of the Election

> Within 24 hours from final canvass of votes, there being a
valid election, the Election Officer shall transmit the record of the
case to the Med-Arbiter who shall issue an order proclaiming the
results of the election and certifying the union which obtained a
majority of the valid votes cast.
 7.5. Appeal
> The decision of the Med-Arbiter may be appealed to the Secretary
within 10 days from receipt by the parties of the copy thereof. The Secretary
shall 15 days from receipt of the records within which to decide the appeal.

7.6. Appealable:
a) Order denying the Petition for Certification Election;
b) Order granting the Petition for Certification Election in an
organized establishment.

7.7. Not Appealable : Order granting a petition for Certification election

in an unorganized establishment.
Ratio: The law wants to unionize the ununionized.
 8. Double Majority Rule
> For there to be valid certification election, two majorities must be
complied with:
a) Majority of bargaining unit must have voted; and
b) The winning union must have garnered majority of the valid
votes cast.

9. How to determine the double majority rule

a) In determining the eligible votes cast (First majority), include
spoiled ballots.
b) In determining the valid votes (second majority), eliminate
spoiled ballots but include challenged votes.
Consent Election – Voluntarily agreed upon by the
parties with or without the intervention of DOLE.

Voluntary Recognition – is the process whereby the

employer recognize a labor organization as the exclusive
bargaining representative of the employees in the
appropriate bargaining unit after a showing that the
labor organization is supported by at least a majority of
the employees in the bargaining unit.
 10. Requirements for Voluntary Recognition
10.1. Voluntary recognition is possible only in an unorganized
establishment;
10.2. only one union is asking for recognition; and
10.3. The union voluntarily recognized should be the majority union
as indicated by the fact that members object to f the bargaining unit
did not to the projected recognition.
Note: The Voluntary Recognition bars the filing of a petition for
certification election for one year from the date of entry; after one year,
any legitimate labor organization may file a petition for certification
election, unless a CBA between the employer and the union voluntarily
recognized was executed and registered with the Regional office.
Sole and Exclusive Bargaining Agent Certification – is the process
whereby the DOLE recognizes a labor organization as the exclusive
bargaining representative of the employees in the appropriate bargaining
unit.

11. Procedure in Request for SEBA Certification:

11.1. Where to file: Any legitimate labor organization may file a request for
SEBA certification in the Regional Office which issued its certificate of
registration or certificate of creation of chartered local.
11.2. Requirements: The request shall indicate:
a) The name and address of the requesting legitimate labor organization;
b) The name and address of the company where it operates;
c) The bargaining unit sought to be represented;
 d) The approximate number of employees in the bargaining
unit; and
e) The statement of the existence/non existence of other labor
organizations/CBA
11.3. Action on the request by the Regional Director shall be made
within one from the receipt of the same. The Regional Director
shall:
a) Determine the compliance of the request;
b) Determine whether the bargaining unit sought to be
represented is organized or not; and
c) Request a copy of the payroll for purposes of SEBA
certification.