Primer on Labor organizations and Collective Bargaining

1. What are Labor organizations?

Labor organizations refers to any union or association of employees in the

private sector which exists in whole or in part for the following purposes.

 Collective Bargaining
 Dealing with employers concerning terms and conditions of employment
 Mutual Aid
 Cooperation and other lawful purpose

Labor Organization is a generic term as it can refer to a union or association of

employees. A Labor Organization is not therefore necessarily a u.nion

2. What is a Union?

Union refers to any labor organization in the private sector organized for
collective bargaining and for other legitimate purposes.

3. What is a Legitimate Labor Organization or (LLO)?

It refers to any labor organization in the private sector registered or reported

with DOLE in accordance with the rules

4. Are all unions legitimate?

No, not every union is legitimate; only those properly registered are considered
as LLO.

5. What is the status of a Union which is unregistered?

Non-registration does not make it illegitimate; it is simply unregistered and has

no legal personality. It exists legally but does not possess the rights of an LLO.

6. Is every LLO an Exclusive Bargaining Representative (EBR)?

No, not every LLO is an Exclusive Bargaining Representative (EBR)

An EBR has to be an LLO but not all LLO is an EBR.

7. How does a Union become an EBR?

 The Union has to be duly registered

 Has to go through the process of Certification by DOLE or through election
among employees whom the union will represent.
 Without passing through the recognition or selection process the union may be
an LLO but not an EBR
8. So, in summary who is considered an Exclusive Bargaining Representative
(EBR)?

An EBR refers to a legitimate labor union duly recognized or certified as the sole
and exclusive bargaining agent (SEBA) or representative of all the employees in a
bargaining unit that will negotiate a collective contract with the employer. EBR
and SEBA are interchangeable.

9. What are the Classifications of Labor Organizations?

National Level

National Union/Federation – means any labor organization with at least 10

locals/chapters or affiliates each of which must be a duly certified or recognized
collective bargaining agent.

Industry Union – means any group of legitimate labor organizations operating

within an identified industry, organized for collective bargaining agreement or for
dealing with employers concerning terms and conditions of employment within
an industry.

Trade Union Center – group of national unions or federations organized for

mutual aid and protection of its members for assisting such members in
collective bargaining or for participating in the formulation of social employment
policies, standards and programs.

Alliance – an aggregation of unions existing in one line of industry or in a

conglomerate, a group of franchisees, a geographical area or an industrial center.

Enterprise level

Independent registration/union – obtained by the union organizers in an

enterprise through their own action instead of through issuance of a charter by
a federation or national union. Has a personality of its own not derived from a
federation but derived from independent registration.
An independent Union may affiliate with a federation or national union, in which
case it may also be called an affiliate. The rules require that at least 20% of the
employees in a bargaining unit should be part of the union.

Chartering – takes place when a duly registered federation or national union

issues a charter to a union in an enterprise and registers the creation of the
chapter with the regional office where the applicant operates. Its legal personality
is derived from the federation/national union but it may subsequently register
itself independently. A chartered local has to be registered not just reported.

Company Union – is a labor organization which in whole or in part is employer-

controlled or employer dominated (prohibited).

Changes made under R.A. 9481

An act Strengthening the Worker’s Constitutional Rights to Self-
Organization

 The 20% registration requirement applies only to an independent union;

hence a company can be quickly unionized by a very small number of
employees.

 A local chapter is created once a federation or a national union issues a

charter certificate.

 Once issued a charter, the chapter acquires legal personality to file a

petition for certification election.

 Three specified grounds for cancellation

Falsehood about the Constitution By-Laws or
Falsehood about election of officers
Voluntary Dissolution

 At least 2/3 of the membership may vote to dissolve their organization, but
this action re quires a subsequent “application to cancel” to be submitted
by the board of the organization, attested by the president.

 A petition to cancel union registration does not prevent the filing of a

petition for a certification election.

 Supervisors Union and Rank and File in same company may affiliate with
same federation.

 Commingling of supervisors and rank and file in one union is not a ground
to cancel union registration. Excludible member is deemed automatically
removed from the list.

 In an organized enterprise the federation who files for Petition for

Certification Election on behalf of the charter cannot be required to identify
the chapter’s officers and members. The petition does not have to be filed
by the local officers.

 The non-disclosure rule applies also to a federation that files a PCE on

behalf of its chapter in an enterprise without yet a union as bargaining
agent.

 Employer is a bystander and has no right to oppose the petition.

10. What is the rationale of the registration requirement for labor
organizations ?

It is the fact of registration with DOLE that makes a labor organization legitimate
in the sense that it is clothed with legal personality to claim representational and
bargaining rights.

The Supreme Court in the case of PAFLU vs. Sec. of Labor – 2222, Feb. 27, 1969
has upheld the legality of the requirement to register labor unions.

The registration prescribed in paragraph (b) of said section 1 is not a

limitation to the right of assembly or association, which may be exercised with
or without said registration. 2 The latter is merely a condition sine qua non for
the acquisition of legal personality by labor organizations, associations or unions
and the possession of the "rights and privileges granted by law to legitimate labor
organizations". The Constitution does not guarantee these rights and privileges,
much less said personality, which are mere statutory creations, for the
possession and exercise of which registration is required to protect both labor
and the public against abuses, fraud, or impostors who pose as organizers,
although not truly accredited agents of the union they purport to represent. Such
requirement is a valid exercise of the police power, because the activities in
which labor organizations, associations and union of workers are engaged
affect public interest, which should be protected.

11. What are the requirements for registration of Labor Organizations?

 Fifty (50) Pesos registration fee (now Php 70)

 The names of its officers, their addresses, the principal address of
the labor organization, the minutes of the organizational meetings
and the list of the workers who participated in such meetings
 In case the applicant is an independent union, the names of all its
members comprising at least twenty percent (20%) of all the employees in
the bargaining unit it seeks to operate.
 If the applicant Union has been in existence for one or more years;
Copies of its annual financial reports.
 Four (4) copies of the constitution and by-laws of the applicant; minutes
of its adoption or ratification and the list of members who participated in
it. ( Article 240 [234], Labor Code, As amended by B.P. Blng 130, August 21,
1981 and Section 1, Republic Act No. 9481 which lapsed into law on May
25, 2007)

12. Can the members withdraw their membership thereby depleting the 20%
requirement under article 240(c), is the union still registrable?

13. Or if the Union is already registered, does the members’ withdrawal

invalidate the Union’s registration?

For both questions, there is yet no categorical jurisprudential answer except

a guideline on how to view withdrawals:
  If the withdrawal is done before the application for registration is filed
the withdrawal is presumed voluntary and it may prejudice the
registrability of the applicant union.

 If the withdrawal is done after the application is filed, the withdrawal

is considered involuntary and does not affect the registration
application.

 If the registration is already done, it is considered involuntary and does

not affect the registration.

A court decision, citing an earlier case answers by way of a question: Is it not

but logical to assume that such withdrawal [done after the Union was
registered] cannot work to nullify the registration of the Union ? ( Eagle Ridge
Golf and Country Club vs CA and Eagle Ridge Employees Union G.R. No.
178989, March 18, 2010.)

10. What is the relationship between a local or chapter and the labor federation
or national union?

The relationship between a local or chapter and the labor federation or national
union is generally understood to be that of agency, where the local is the
principal and the federation the agent.

11. What are the requirements for a chartered local of a federation or national
union for them to acquire a legal personality?

 Registration with the Regional Office

 A Charter certificate issued by the federation/national union indicating
the creation or establishment of the local/charter
 The names of the local chapter’s officers, their addresses, and the principal
office of the local chapter
 The local chapter’s constitution and by-laws unless it is the same as the
federation/national union, such fact must be indicated accordingly.

12. May a labor union disaffiliate from the mother union ?

Yes, 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. (Tanduay Distillery Labor Union vs NLRC 149 SCRA
470)

The freedom period refers to the last 60 days of the fifth and last year of the CBA.
Disaffiliation must be effected by a majority of the members in the bargaining
unit.

13. Disaffiliation: Effect on the existing CBA?

 Employees cannot revoke the validly executed collective bargaining agreement by
the simple expedient of changing their bargaining agent. The new agent must
respect the contract – Substitutionary Doctrine.

14. Effect of Revocation of Charter by the Federation/National Union ?

It divest the local chapter of its legal personality upon receipt of notice by the
bureau, unless in the meantime the local chapter has acquired independent
registration in accordance with the rules.( Implementing Rules Book V Rule VII
Section 5 )

15. Effect of Cancellation of Registration of Federation or National Union on

locals/chapters.

It shall operate to divest its locals/chapters of their status as legitimate labor

organization unless the locals/chapters are covered by a duly registered collective
bargaining agreement.

16. What is the nature of the relationship between the union and its members?

It is fiduciary in nature. The union may be considered as agents of its members

in securing fair and just wages and good working conditions.

17. What is a Collective Bargaining Agreement?

Refers to a contract executed upon request of either the employer or the exclusive
bargaining representative of the employees incorporating the agreement reached
after negotiations with respect to wages, hours, and conditions of work, including
proposals for adjusting any grievances or questions under such
agreement.(Pambusco vs Pambusco Employees Union 68 Phil 451)

18. What jurisdictional preconditions must be present before a Collective to

set in motion the mechanics of Collective Bargaining ?

 Status of Majority Representation of the employees’ representative in

accordance with any of the means of selection or designation provided by the
Labor Code;

 Proof of majority representation

 Demand to bargain under Art. 251 of the New Labor Code

(Kiokloy v NLRC G.R. No. L-54334, January 22, 1986)

19. Terms of a Collective Bargaining Agreement – As to the representation

aspect.
 Any Collective Bargaining Agreement that the parties may enter into shall, insofar
as the representation aspect is concerned, be for a term of five (5) years. ( Article
265(253-A), Labor Code, as amended by Section 21, Republic Act No. 6715, March
21, 1989 )

20. What does the Freedom Period refer to?

Freedom period” is the last sixty (60) days of the lifetime of a
collective bargaining agreement immediately prior to its
expiration It is so called because it is the only time when the law allows the
parties to serve notice to terminate, alter or modify the existing agreement. It
is also the time when the majority status of the bargaining union or
agent may be challenged by another union by filing appropriate petition
for certification.
21. What is the significance and implication of the Freedom Period in general?

No petition questioning the majority status of the incumbent bargaining agent

shall be entertained and no certification election shall be conducted by DOLE
outside of the sixty day (60) period immediately before the date of expiry of
such five year term of the Collective Bargaining Agreement. (Article 265 [253-A],
Labor Code, as Amended by Section 21, Republic Act No. 6715, March 21, 1989)

22. What is the implication/significance of the Freedom Period ? as far as the

representation aspect is concerned ?

 A Petition for Certification Election must be filed during the 60 day freedom
period raising a legitimate representation issue.

 Hence, mere filing of a Petition for Certification Election does not ipso facto
justify the suspension or negotiation by the employe.

 The petition must first comply with the provisions of the Labor Code
and its implementing rules.

 Foremost is that a petition for certification election or a motion for

intervention can only be entertained within sixty (60) days prior to
the expiry date of the agreement. (Lakas ng Manggagawang
Makabayan v. Marcelo Enterprises, 118 SCRA 422 (1982).

23. Exclusive bargaining representation and its concept ?

The labor organization designated or selected by the majority of the employees

in an appropriate collective bargaining unit shall be the exclusive bargaining
representative of the employees in such unit for the purpose of collective
bargaining. (Article 267 [255], Labor Code, as amended by Section 22, Republic
Act No. 6715, March 21, 1989 )
24. What is the nature of the determination of exclusive bargaining agent ?
 The determination of such exclusive bargaining agent is a non-litigious
proceeding and as far as practicable, shall be free from technicalities of law
and procedure, provided only that in every case the exclusive bargaining agent
enjoys majority support of all the employees in the bargaining unit (Section 1,
Rule VI Book V, Omnibus Rules Implementing the Labor Code )

25. What is the nature of the determination of exclusive bargaining agent ?

The determination of such exclusive bargaining agent is a non-litigious

proceeding and as far as practicable, shall be free from technicalities of law
and procedure, provided only that in every case the exclusive bargaining agent
enjoys majority support of all the employees in the bargaining unit (Section 1,
Rule VI Book V, Omnibus Rules Implementing the Labor Code )