KNITJOY MANUFACTURING v. PURA FERRER-CALLEJA, GR No.

81883, 1992-09-23

Facts:

Petitioner KNITJOY had a collective bargaining agreement (CBA) with the Federation of Filipino Workers (FFW). The bargaining unit covered
only the regular rank-and-file employees of KNITJOY paid on a daily or piece-rate basis. It did not include regular rank-and-file office... and
production employees paid on a monthly basis.

The CBA expired on 15 June 1987.

Prior to its expiration,the Trade Union of the Philippines and Allied Services (TUPAS) filed a petition for the holding of a certification election
among KNITJOY's regular rank-and-file employees paid on a daily and piece-rate basis. Excluded were the regular... rank-and-file employees
paid on a monthly basis. In the certification election conducted on 10 June 1987, CFW emerged as the winner; thereafter, negotiations for a
new CBA between CFW and KNITJOY commenced.

during the pendency of the said negotiations,... private respondent KMEU filed a petition for certification election among KNITJOY's regular
rank-and-file monthly paid employees

The petition was dismissed in the Order of 4 September 1987 of Med-Arbiter Rolando S. de la Cruz

KMEU filed a motion to reconsider this order, which was treated as an appeal by the Bureau of Labor Relations (BLR).

On 1 December 1987, public respondent Pura Ferrer-Calleja, Director of the BLR, handed down a Decision... reversing the order of Med-
Arbiter de la Cruz.

Respondent Director brushed aside KNITJOY's arguments that the monthly-paid employees have the same working incentives as their
counterparts, the daily-paid workers; that the existing collective bargaining agent (CFW) is willing to include the monthly-paid employees; and
that... out of the 212 monthly-paid employees, 116 qualify as managerial employees while the rest who are holding confidential or technical
positions should likewise be excluded.

Issues:

Whether or not petitioner KNITJOY'S monthly-paid regular rank-and-file employees can constitute an appropriate bargaining unit separate and
distinct from the existing unit composed of daily or piece-rate paid regular rank-and-file employees, and

Whether or not the inclusion in the coverage of the new CBA between KNITJOY and CFW of the monthly-paid rank-and-file employees bars
the holding of a certification election among the said monthly paid employees.

Ruling:

We decide for the respondents.

The suggested bias of the Labor Code in favor of the one company-one union policy, anchored on the greater mutual benefits which the parties
could derive, especially in the case of employees whose bargaining strength could undeniably be enhanced by their unity and... solidarity but
diminished by their disunity, division and dissension, is not without 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.

"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 x x

(c) description of the bargaining unit which shall be the employer unit unless circumstances otherwise require; x x x."

The right to form a union or association or to self-organization comprehends two (2) broad notions, to wit: (a) the liberty or freedom, i.e., the
absence of restraint which guarantees that the employee may act for himself without being prevented by... law, and (b) the power,
by virtue of which an employee may, as he pleases, join or refrain from joining an association.

FACTS: 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 (represented by Federation of Filipino Workers - FFW). On the other

hand, the rank-and-file employees paid on a monthly basis were never included within its scope. Prior to the

expiration of the CBA, FFW was split into 2 factions - the Johnny Tan and the Aranzamendez factions. The latter

eventually became the Confederation of Filipino Workers (CFW) while the former retained the name of FFW.

Respondent KMEU’s 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.

ISSUE: Is there a violation of collective right of employees to self-organization?

Whether or not petitioner KNITJOY’s monthly-paid regular rank-and-file employees can constitute an appropriate

bargaining unit separate and distinct from the existing unit composed of daily or piece-rate paid regular rank-and-

file employees, and

HELD: Yes. The suggested bias of the Labor Code on 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

.
DUNLOP SLAZENGER (PHILS.), INC., petitioner, vs. HON. SECRETARY OF LABOR AND
EMPLOYMENT and DUNLOP SLAZENGER STAFF ASSOCIATION - APSOTEU, respondents.

Facts:

On September 15, 1995, Dunlop-Slazenger Staff Assoc. (DSSA) filed a Petition for Cert. Election before DOLE Pampanga, alleging
that it is a legitimate labor organization, a duly chartered local of Associated Professional, Supervisory Office & Technical
Employees Union (APSOTEU). DSSA further alleged that Dunlop Slazenger Inc. (DSI) is an unorganized establishment, that there
is no CBA barring the filing of the petition for cert. election, and that no cert. election has been conducted within 1 year prior to filing
of the petition for cert. election.

In response, DSI filed its Answer w/Motion to Dismiss on October 9, 1995 based on three grounds:

1. DSSA is comprised of supervisory and rank-and-file EEs and cannot act as bargaining agent for the proposed unit.
2. A single certification election cannot be conducted jointly among supervisory and rank-and-file EEs.
3. DSSA lacks legal standing since it failed to submit its books of accounts.

DSSA, in its Reply, stated that its members are supervisors and NOT rank-and-file EEs, and averred that all members are paid
monthly by DSI. DSSA also alleged that the bargaining unit it wants to represent is made up of the monthly paid supervisory
employees and other personnel who cannot be classified as belonging to the rank-and-file. It also contended that it has no
obligation to attach its books of accounts since it is a legitimate labor organization. Finally, it urged that the certification election
proceeding cannot be used to question the legal personality of a labor organization.

On March 4, 1996, however, DSSA submitted its new books of accounts consisting of the Cash Receipts Journal, Cash
Disbursements Journal and two (2) ledgers.

Med-Arbiter granted the petition on July 5, 1996, with the Secretary of Labor affirming the decision, citing Art. 245 (251[n]) of the
Labor Code. Regarding the issue of member composition of the union, the Secretary stated that:

“…the same is not a sufficient reason that would warrant the dismissal of the present petition. The same can be taken
care (sic) of during the pre-election conference thru the exclusion-inclusion proceedings wherein those
employees who are occupying rank and file positions will be excluded from the list of eligible voters.”

Further to this, the Secretary agrees with the Med-Arb decision in stating that DSSA has sufficiently complied with the mandatory
reportorial requirements provided under the Labor Code IRRs (Section 3, Rule II, Book V).

MR was filed by DSI but was denied.

Issues

WON the DSSA can file a Petition for Cert. Election to represent the supervisory EEs of the DSI. NO. Petition of DSI meritorious.
Held:

The Court first reiterated that supervisors can create or join an appropriate bargaining unit, in accordance with earlier rulings stating
that 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. The resolution of the case, therefore, revolves around WON the
union is solely composed of supervisory EEs.

In determining the difference between supervisory and rank-and-file EEs, the Labor Code’s definitions according to Art. 212[217,n]
(m) and Section 1(t), Rule I, Book V of the Omnibus Rules of the Labor Code were used.

''Managerial employee is one who is vested with powers 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.”

The status test for supervisors is WON an employee possesses authority to act in the interest of his employer, which authority
should not be merely routine or clerical in nature but requires the use of independent judgment. Corollary to this, what determines
the nature of employment is not the employee's title, but his job description.

As the case states, the list of monthly paid EEs submitted by DSI contain the names of:

 27 supervisory EEs
 6 managerial EEs
 1 confidential EE
 26 office and technical EEs holding various positions which were shown by the Court as rank-and-file positions due to the
positions not carrying the authority to act in the interest of the employer, or to recommend managerial actions.

The Court also states that it is not decisive that these employees are monthly paid employees, as their mode of compensation is
usually a matter of convenience and does not necessarily determine the nature and character of their job.

The Secretary of Labor also erred in stating that the infirmity is remedied by conducting the “pre-election conference through
exclusion-inclusion proceedings”, stating that there is an misappreciation of the antipathy between the interest of supervisors and
rank-and-file EEs. As held in Toyota Motor Philippines v. Toyota Motors Philippines Corporation Labor Union:

“…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.”

As a result, DSSA has no legal right to file a Petition for Certification Election to represent a bargaining unit for supervisors as long
as it counts rank-and-file EEs in its ranks.

FACTS

-Respondent union filed a Petition for Certification Election among the supervisory, office and technical employees of
the petitioner company before the DOLE, Regional Office No. III.

-Petitioner company filed a motion to dismiss based on 1) that the respondent union is comprised of supervisory and
rank-and-file employees and cannot act as bargaining agent for the proposed unit; (2) that a single
certification election cannot be conducted jointly among supervisory and rank-and-file employees; and (3) that the
respondent union lacks legal standing since it failed to submit its books of accounts.

-Respondent alleges that it is composed only of supervisory employees and that it has no obligation to attach its books
of accounts since it is a legitimate labor organization.

-The mediator arbiter granted the petition of the union. It said that the contention of the respondent that the
petitioning union is composed of both supervisory and rank and file employees is not sufficient to dismiss the
petition. It can be remedied thru the exclusion-inclusion proceedings wherein those employees who are occupying
rank and file positions will be excluded from the list of eligible voters. The secretary of labor affirmed.

ISSUE/S

WON the union can be composed of supervisory and rank and file employees

HELD

NO.

Ratio Article 245 of the Labor Code clearly provides that “supervisory employees shall not be eligible for membership
in a labor organization of the rank-and-file employees.” Reasoning Public respondent gravely misappreciates the
basic antipathy between the interest of supervisors and the interest of rankand-fileemployees. There is a
irreconcilability of their interests which cannot be cured even in the exclusion-inclusion proceedings.