G.R. No.

L-50283-84 April 20, 1983

DOLORES VILLAR, ROMEO PEQUITO, DIONISIO RAMOS, BENIGNO MAMARALDO,

ORLANDO ACOSTA, RECITACION BERNUS, ANSELMA ANDAN, ROLANDO DE GUZMAN and
RITA LLAGAS, petitioners,
vs.
THE HON. AMADO G. INCIONG, as Deputy Minister of the Ministry of Labor, AMIGO
MANUFACTURING INCORPORATED and PHILIPPINE ASSOCIATION OF FREE LABOR
UNIONS (PAFLU), respondents.

Aniceto Haber for petitioners.

Roberto T. Neri for respondents.

GUERRERO, J.:

Petition for review by certiorari to set aside the Order dated February 15, 1979 of respondent Deputy
Minister Amado G. Inciong affirming the Decision of the OIC of Regional Office No. 4 dated October
14, 1978 which jointly resolved RO4-Case No. T-IV-3549-T and RO4-Case No. RD 4-4088-77-T.

The facts are as follows:

Petitioners were members of the Amigo Employees Union-PAFLU, a duly registered labor
organization which, at the time of the present dispute, was the existing bargaining agent of the
employees in private respondent Amigo Manufacturing, Inc. (hereinafter referred to as Company).
The Company and the Amigo Employees Union-PAFLU had a collective bargaining agreement
governing their labor relations, which agreement was then about to expire on February 28, 1977.
Within the last sixty (60) days of the CBA, events transpired giving rise to the present dispute.

On January 5, 1977, upon written authority of at least 30% of the employees in the company,
including the petitioners, the Federation of Unions of Rizal (hereinafter referred to as FUR) filed a
petition for certification election with the Med-Arbiter's Office, Regional Office No. 4 of the Ministry of
Labor and Employment. The petition was, however, opposed by the Philippine Association of Free
Labor Unions (hereinafter referred to as PAFLU) with whom, as stated earlier, the Amigo Employees
Union was at that time affiliated. PAFLU's opposition cited the "Code of Ethics" governing inter-
federation disputes among and between members of the Trade Unions Congress of the Philippines
(hereinafter referred to as TUCP). Consequently, the Med-Arbiter indorsed the case to TUCP for
appropriate action but before any such action could be taken thereon, the petitioners disauthorized
FUR from continuing the petition for certification election for which reason FUR withdrew the petition.

On February 7, 1977, the same employees who had signed the petition filed by FUR signed a joint
resolution reading in toto as follows:

Sama-Samang Kapasiyahan

1. TUMIWALAG bilang kasaping Unyon ng Philippine Association of Free Labor

Unions (PAFLU) at kaalinsabay nito, inaalisan namin ang PAFLU ng kapangyarihan
na katawanin kami sa anumang pakikipagkasundo (CBA) sa Pangasiwaan ng aming
pinapasukan at kung sila man ay nagkasundo o magkakasundo sa kabila ng
 pagtitiwalag na ito, ang nasabing kasunduan ay hindi namin pinagtitibay at tahasang
aming itinatakwil/tinatanggihan;

2. BINABAWI namin ang aming pahintulot sa Federation of Unions of Rizal (FUR) na

katawanin kami sa Petition for Certification Election (RO4-MED Case No. 743-77)
at/o sa sama-samang pakikipagkasundo sa aming patrons;

3. PANATILIHIN na nagsasarili (independent) ang aming samahan, AMIGO

EMPLOYEES' UNION, alinsunod sa Artikulo 240 ng Labor Code;

4. MAGHAIN KAAGAD ang aming Unyong nagsasarili, sa pamumuno ng aming

pangsamantalang Opisyal na kinatawan, si Ginang DOLORES VILLAR, ng Petition
for Certification Election sa Department of Labor, para kilalanin ang aming Unyong
nagsasarili bilang Tanging kinatawan ng mga manggagawa sa sama-samang
pakikipagkasundo (CBA);

5. BIGYAN ng kopya nito ang bawa't kinauukulan at ang mga kapasiyahang ito ay
magkakabisa sa oras na matanggap ng mga kinauukulan ang kani-kanilang sipi nito.1

Immediately thereafter or on February 9, 1977, petitioner Dolores Villar, representing herself to be

the authorized representative of the Amigo Employees Union, filed a petition for certification election
in the Company before Regional Office No. 4, with the Amigo Employees Union as the petitioner.
The Amigo Employees Union-PAFLU intervened and moved for the dismissal of the petition for
certification election filed by Dolores Villar, citing as grounds therefor, viz: (a) the petition lacked the
mandatory requisite of at least 30% of the employees in the bargaining unit; (2) Dolores Villar had no
legal personality to sign the petition since she was not an officer of the union nor is there factual or
legal basis for her claim that she was the authorized representative of the local union; (3) there was
a pending case for the same subject matter filed by the same individuals; (4) the petition was barred
by the new CBA concluded on February 15, 1977; (5) there was no valid disaffiliation from PAFLU;
and (6) the supporting signatures were procured through false pretenses.

Finding that the petition involved the same parties and causes of action as the case previously
indorsed to the TUCP, the Med-Arbiter dismiss the petition filed by herein petitioner Villar, which
dismissal is still pending appeal before the Bureau of Labor Relations.

In the meantime, on February 14, 1977, the Amigo Employees Union- PAFLU called a special
meeting of its general membership. A Resolution was thereby unanimously approved which called
for the investigation by the PAFLU national president, pursuant to the constitution and by-laws of the
Federation, of all of the petitioners and one Felipe Manlapao, for "continuously maligning, libelling
and slandering not only the incumbent officers but even the union itself and the federation;"
spreading 'false propaganda' that the union officers were 'merely appointees of the management',
and for causing divisiveness in the union.

Pursuant to the Resolution approved by the Amigo Employees Union- PAFLU, the PAFLU, through
its national President, formed a Trial Committee to investigate the local union's charges against the
petitioners for acts of disloyalty inimical to the interest of the local union, as well as directing the Trial
Committee to subpoena the complainants (Amigo Employees Union-PAFLU) and the respondents
(herein petitioners) for investigation, to conduct the said investigation and to submit its findings and
recommendations for appropriate action.

And on the same date of February 15, 1977, the Amigo Employees Union- PAFLU and the Company
concluded a new CBA which, besides granting additional benefits to the workers, also
reincorporated the same provisions of the existing CBA, including the union security clause reading,
to wit:

ARTICLE III
UNION SECURITY WITH RESPECT TO PRESENT MEMBERS

All members of the UNION as of the signing of this Agreement shall remain members
thereof in good standing. Therefore, any members who shall resign, be expelled, or
shall in any manner cease to be a member of the UNION, shall be dismissed from
his employment upon written request of the UNION to the Company. 2

Subsequently, petitioners were summoned to appear before the PAFLU Trial

Committee for the aforestated investigation of the charges filed against them by the
Amigo Employees Union-PAFLU. Petitioners, however, did not attend but requested
for a "Bill of Particulars" of the charges, which charges were stated by the Chairman
of the committee as follows:

1. Disaffiliating from PAFLU and affiliating with the Federation of Unions of Rizal
(FUR).

2. Filling petition for certification election with the Bureau of Labor Relations and
docketed as Case No. R04-MED-830-77 and authorizing a certain Dolores Villar as
your authorized representative without the official sanction of the mother Federation-
PAFLU.

3. Maligning, libelling and slandering the incumbent officers of the union as well as of
the PAFLU Federation.

4. By spreading false propaganda among members of the Amigo Employees Union-

PAFLU that the incumbent union officers are 'merely appointees' of the management.

5. By sowing divisiveness instead of togetherness among members of the Amigo

Employees Union-PAFLU.

6. By conduct unbecoming as members of the Amigo Employees Union- PAFLU

which is highly prejudicial to the union as well as to the PAFLU Federation.

All these charges were formalized in a resolution of the incumbent officers of the
Amigo Employees Union-PAFLU dated February 14, 1977. 3

Not recognizing PAFLU's jurisdiction over their case, petitioners again refused to participate in the
investigation rescheduled and conducted on March 9, 1979. Instead, petitioners merely appeared to
file their Answer to the charges and moved for a dismissal.

Petitioners contend in their Answer that neither the disaffiliation of the Amigo Employees Union from
PAFLU nor the act of filing the petition for certification election constitute disloyalty as these are in
the exercise of their constitutional right to self-organization. They further contended that PAFLU was
without jurisdiction to investigate their case since the charges, being intra-union problems within the
Amigo Employees Union-PAFLU, should be conducted pursuant to the provisions of Article XI,
Sections 2, 3, 4 and 5 of the local union's constitution and by-laws.
The complainants, all of whom were the then incumbent officers of the Amigo Employees Union-
PAFLU, however, appeared and adduced their evidence supporting the charges against herein
petitioners.

Based on the findings and recommendations of the PAFLU trial committee, the PAFLU President, on
March 15, 1977, rendered a decision finding the petitioners guilty of the charges and disposing in the
last paragraph thereof, to wit,

Excepting Felipe Manlapao, the expulsion from the AMIGO EMPLOYEES UNION of
all the other nine (9) respondents, Dionisio Ramos, Recitation Bernus, Dolores Villar,
Romeo Dequito, Rolando de Guzman, Anselma Andan, Rita Llagas, Benigno
Mamaradlo and Orlando Acosta is hereby ordered, and as a consequence the
Management of the employer, AMIGO MANUFACTURING, INC. is hereby requested
to terminate them from their employment in conformity with the security clause in the
collective bargaining agreement. Further, the Trial Committee is directed to
investigate Felipe Manlapao when he shall have reported back for duty. 4

Petitioners appealed the Decision to the PAFLU, citing the same grounds as before, and in addition
thereto, argued that the PAFLU decision cannot legally invoke a CBA which was unratified, not
certified, and entered into without authority from the union general membership, in asking the
Company to terminate them from their employment. The appeal was, likewise, denied by PAFLU in a
Resolution dated March 28, 1977.

After denying petitioner's appeal, PAFLU on March 28, 1977 sent a letter to the Company stating, to
wit,

We are furnishing you a copy of our Resolution on the Appeal of the respondent in
Administrative Case No. 2, Series of 1977, Amigo Employees Union-PAFLU vs.
Dionisio Ramos, et al.

In view of the denial of their appeal and the Decision of March 15, 1977 having
become final and executory we would appreciate full cooperation on your part by
implementing the provision of our CBA on security clause by terminating the
respondents concerned from their employment. 5

This was followed by another letter from PAFLU to the Company dated April 25, 1977, reiterating the
demand to terminate the employment of the petitioners pursuant to the security clause of the CBA,
with a statement absolving the Company from any liability or damage that may arise from petitioner's
termination.

Acting on PAFLU's demand, the Company informed PAFLU that it will first secure the necessary
clearances to terminate petitioners. By letter dated April 28, 1977, PAFLU requested the Company
to put petitioners under preventive suspension pending the application for said clearances to
terminate the petitioners, upon a declaration that petitioners' continued stay within the work premises
will "result in the threat to the life and limb of the other employees of the company." 6

Hence, on April 29, 1977, the Company filed the request for clearance to terminate the petitioners
before the Department of Labor, Regional Office No. 4. The application, docketed as RO4-Case No.
7-IV-3549-T, stated as cause therefor, "Demand by the Union Pursuant to the Union Security
Clause," and further, as effectivity date, "Termination-upon issuance of clearance; Suspension-upon
receipt of notice of workers concerned." 7 Petitioners were then informed by memorandum dated
April 29, 1977 that the Company has applied for clearance to terminate them upon demand of
PAFLU, and that each of them were placed under preventive suspension pending the resolution of
the said applications. The security guard was, likewise, notified to refuse petitioners entry into the
work premises. 8

In an earlier development, on April 25, 1977, or five days before petitioners were placed under
preventive suspension, they filed a complaint with application for preliminary injunction before the
same Regional Office No. 4, docketed as RO4-Case No. RD-4-4088-77-T, praying that after due
notice and hearing, "(1) A preliminary injunction be issued forthwith to restrain the respondents from
doing the act herein complained of, namely: the dismissal of the individual complainants from their
employment; (2) After due hearing on the merits of the case, an Order be entered denying and/or
setting aside the Decision dated March 15, 1977 and the Resolution dated March 28, 1977, issued
by respondent Onofre P. Guevara, National President of respondent PAFLU; (3) The Appeal of the
individual complainants to the General Membership of the complainant AMIGO EMPLOYEES
UNION, dated March 22, 1977, pursuant to Sections 2, 3, 4 & 5, Article XI in relation of Section 1,
Article XII of the Union Constitution and By-Laws, be given due course; and (4) Thereafter, the said
preliminary injunction be made permanent, with costs, and with such further orders/reliefs that are
just and equitable in the premises."9

In these two cases filed before the Regional Office No. 4, the parties adopted their previous
positions when they were still arguing before the PAFLU trial committee.

On October 14, 1977, Vicente Leogardo, Jr., Officer-in-Charge of Regional Office No. 4, rendered a
decision jointly resolving said two cases, the dispositive portion of which states, to wit,

IN VIEW OF THE FOREGOING, judgment is hereby rendered granting the

application of the Amigo Manufacturing, Inc., for clearance to terminate the
employment of Dolores D. Villar, Dionisio Ramos, Benigno Mamaraldo, Orlando
Acosta, Recitacion Bernus, Anselma Andan, Rolando de Guzman, and Rita Llagas.
The application of oppositors, under RO4-Case No. RD-4-4088-77, for a preliminary
injunction to restrain the Amigo Manufacturing, Inc. from terminating their
employment and from placing them under preventive suspension, is hereby
DISMISSED. 10

Not satisfied with the decision, petitioners appealed to the Office of the Secretary of Labor. By Order
dated February 15, 1979, the respondent Amado G. Inciong, Deputy Minister of Labor, dismissed
their appeal for lack of merit. 11

Hence, the instant petition for review, raising the following issues:

A. Is it not error in both constitutional and statutory law by the respondent Minister
when he affirmed the decision of the RO4-Officer-in-Charge allowing the preventive
suspension and subsequent dismissal of petitioners by reason of the exercise of their
right to freedom of association?

B. Is it not error in law by the respondent Minister when he upheld the decision of the
RO4 OIC which sustained the availment of the respondent PAFLU's constitution over
that of the local union constitution in the settlement of intra-union dispute?

C. Is it not error in law amounting to grave abuse of discretion by the Minister in

affirming the conclusion made by the RO4 OIC, upholding the legal applicability of
the security clause of a CBA over alleged offenses committed earlier than its
conclusion, and within the 60-day freedom period of an old CBA? 12
The main thrust of the petition is the alleged illegality of the dismiss of the petitioners by private
respondent Company upon demand of PAFLU which invoked the security clause of the collective
bargaining agreement between the Company and the local union, Amigo Employees Union-PAFLU.
Petitioners contend that the respondent Deputy Minister acted in grave abuse of discretion when he
affirmed the decision granting the clearance to terminate the petitioners and dismissed petitioners'
complaint, and in support thereof, allege that their constitutional right to self-organization had been
impaired. Petitioner's contention lacks merit.

It is true that disaffiliation from a labor union is not open to legal objection. It is implicit in the freedom
of association ordained by the Constitution. 13 But this Court has laid down the ruling that a closed
shop is a valid form of union security, and such provision in a collective bargaining agreement is not
a restriction of the right of freedom of association guaranteed by the Constitution. 14

In the case at bar, it appears as an undisputed fact that on February 15, 1977, the Company and the
Amigo Employees Union-PAFLU entered into a Collective Bargaining Agreement with a union
security clause provided for in Article XII thereof which is a reiteration of the same clause in the old
CBA. The quoted stipulation for closed-shop is clear and unequivocal and it leaves no room for
doubt that the employer is bound, under the collective bargaining agreement, to dismiss the
employees, herein petitioners, for non- union membership. Petitioners became non-union members
upon their expulsion from the general membership of the Amigo Employees Union-PAFLU on March
15, 1977 pursuant to the Decision of the PAFLU national president.

We reject petitioners' theory that their expulsion was not valid upon the grounds adverted to earlier in
this Decision. That PAFLU had the authority to investigate petitioners on the charges filed by their
co-employees in the local union and after finding them guilty as charged, to expel them from the roll
of membership of the Amigo Employees Union-PAFLU is clear under the constitution of the PAFLU
to which the local union was affiliated. And pursuant to the security clause of the new CBA,
reiterating the same clause in the old CBA, PAFLU was justified in applying said security clause. We
find no abuse of discretion on the part of the OIC of Regional Office No. 4 in upholding the validity of
the expulsion and on the part of the respondent Deputy Minister of Labor in sustaining the same. We
agree with the OIC's decision, pertinent portion of which reads:

Stripped of non-essentials, the basic and fundamental issue in this case tapers down
to the determination of WHETHER OR NOT PAFLU HAD THE AUTHORITY TO
INVESTIGATE OPPOSITORS AND, THEREAFTER, EXPEL THEM FROM THE
ROLL OF MEMBERSHIP OF THE AMIGO EMPLOYEES UNION-PAFLU.

Recognized and salutary is the principle that when a labor union affiliates with a
mother union, it becomes bound by the laws and regulations of the parent
organization. Thus, the Honorable Secretary of Labor, in the case of Amador Bolivar,
et al. vs. PAFLU, et al., NLRC Case No. LR-133 & MC-476, promulgated on
December 3, 1973, declared-

When a labor union affiliates with a parent organization or mother union, or accepts a
charter from a superior body, it becomes subject to the laws of the superior body
under whose authority the local union functions. The constitution, by-laws and rules
of the parent body, together with the charter it issues pursuant thereto to the
subordinate union, constitute an enforceable contract between the parent body and
the subordinate union, and between the members of the subordinate union inter se.
(Citing Labor Unions, Dangel and Shriber, pp. 279-280).
 It is undisputable that oppositors were members of the Amigo Employees Union at
the time that said union affiliated with PAFLU; hence, under the afore-quoted
principle, oppositors are bound by the laws and regulations of PAFLU.

Likewise, it is undeniable that in the investigation of the charges against them,

oppositors were accorded 'due process', because in this jurisdiction, the doctrine is
deeply entrenched that the term 'due process' simply means that the parties were
given the opportunity to be heard. In the instant case, ample and unmistakable
evidence exists to show that the oppositors were afforded the opportunity to present
their evidence, but they themselves disdained or spurned the said opportunity given
to them.

PAFLU, therefore, correctly and legally acted when, pursuant to its Constitution and
By-Laws, it conducted and proceeded with the investigation of the charges against
the oppositors and found them guilty of acts prejudicial and inimical to the interests of
the Amigo Employees Union- PAFLU, to wit: that of falsely and maliciously
slandering the officers of the union; spreading false propaganda among the members
of the Amigo Employees Union-PAFLU; calling the incumbent officers as mere
appointees and robots of management; calling the union company-dominated or
assisted union; committing acts unbecoming of the members of the union and
destructive of the union and its members.

Inherent in every labor union, or any organization for that matter, is the right of self-
preservation. When members of a labor union, therefore, sow the seeds of
dissension and strife within the union; when they seek the disintegration and
destruction of the very union to which they belong, they thereby forfeit their rights to
remain as members of the union which they seek to destroy. Prudence and equity,
as well as the dictates of law and justice, therefore, compelling mandate the adoption
by the labor union of such corrective and remedial measures in keeping with its laws
and regulations, for its preservation and continued existence; lest by its folly and
inaction, the labor union crumble and fall.

Correctly and legally, therefore, the PAFLU acted when, after proper investigation
and finding of guilt, it decided to remove the oppositors from the list of members of
the Amigo Employees Union-PAFLU, and thereafter, recommended to the Amigo
Manufacturing, Inc.; the termination of the employment of the oppositors. 15

We see no reason to disturb the same.

The contention of petitioners that the charges against them being intra-union problems, should have
been investigated in accordance with the constitution and by-laws of the Amigo Employees Union-
PAFLU and not of the PAFLU, is not impressed with merit. It is true that under the Implementing
Rules and Regulations of the Labor Code, in case of intra-union disputes, redress must first be
sought within the organization itself in accordance with its constitution and by-laws. However, it has
been held that this requirement is not absolute but yields to exception under varying circumstances.
Thus, in Kapisanan ng mga Manggagawa sa MRR vs. Hernandez, 20 SCRA 109, We held:

In the case at bar, noteworthy is the fact that the complaint was filed against the
union and its incumbent officers, some of whom were members of the board of
directors. The constitution and by-laws of the union provide that charges for any
violations thereof shall be filed before the said board. But as explained by the lower
court, if the complainants had done so the board of directors would in effect be acting
 as respondent investigator and judge at the same time. To follow the procedure
indicated would be a farce under the circumstances, where exhaustion of remedies
within the union itself would practically amount to a denial of justice or would be
illusory or vain, it will not be insisted upon, particularly where property rights of the
members are involved, as a condition to the right to invoke the aid of a court.

The facts of the instant petition stand on all fours with the aforecited case that the principle therein
enunciated applies here as well. In the case at bar, the petitioners were charged by the officers of
the Amigo Employees Union- PAFLU themselves who were also members of the Board of Directors
of the Amigo Employees Union-PAFLU. Thus, were the petitioners to be charged and investigated
according to the local union's constitution, they would have been tried by a trial committee of three
(3) elected from among the members of the Board who are themselves the accusers. (Section 2,
Article 11, Constitution of the Local Union). Petitioners would be in a far worse position had this
procedure been followed. Nonetheless, petitioners admit in their petition that two (2) of the six (6)
charges, i.e. disaffiliation and filing a petition for certification election, are not intra-union matters
and, therefore, are cognizable by PAFLU.

Petitioners insist that their disaffiliation from PAFLU and filing a petition for certification election are
not acts of disloyalty but an exercise of their right to self-organization. They contend that these acts
were done within the 60-day freedom period when questions of representation may freely be raised.
Under the peculiar facts of the case, We find petitioners' insistence untenable.

In the first place, had petitioners merely disaffiliated from the. Amigo Employees Union-PAFLU,
there could be no legal objections thereto for it was their right to do so. But what petitioners did by
the very clear terms of their "Sama-Samang Kapasiyahan" was to disaffiliate the Amigo Employees
Union-PAFLU from PAFLU, an act which they could not have done with any effective consequence
because they constituted the minority in the Amigo Employees Union-PAFLU.

Extant from the records is the fact that petitioners numbering ten (10), were among the ninety-six
(96) who signed the "Sama-Samang Kapasiyahan" whereas there are two hundred thirty four (234)
union members in the Amigo Employees Union-PAFLU. Hence, petitioners constituted a small
minority for which reason they could not have successfully disaffiliated the local union from PAFLU.
Since only 96 wanted disaffiliation, it can be inferred that the majority wanted the union to remain an
affiliate of PAFLU and this is not denied or disputed by petitioners. The action of the majority must,
therefore, prevail over that of the minority members. 16

Neither is there merit to petitioners' contention that they had the right to present representation
issues within the 60-day freedom period. It is true, as contended by petitioners, that under Article
257 of the Labor Code and Section 3, Rule 2, Book 2 of its Implementing Rules, questions of
exclusive bargaining representation are entertainable within the sixty (60) days prior to the expiry
date of an existing CBA, and that they did file a petition for certification election within that period.
But the petition was filed in the name of the Amigo Employees Union which had not disaffiliated from
PAFLU, the mother union. Petitioners being a mere minority of the local union may not bind the
majority members of the local union.

Moreover, the Amigo Employees Union, as an independent union, is not duly registered as such with
the Bureau of Labor Relations. The appealed decision of OIC Leogardo of Regional Office No. 4
states as a fact that there is no record in the Bureau of Labor Relations that the Amigo Employees
Union (Independent) is registered, and this is not disputed by petitioners, notwithstanding their
allegation that the Amigo Employees Union is a duly registered labor organization bearing Ministry of
Labor Registration Certification No. 5290-IP dated March 27, 1967. But the independent union
organized after the "Sama-Samang Kapasiyahan" executed February 7, 1977 could not have been
registered earlier, much less March 27, 1967 under Registration Certificate No. 5290-IP. As such
unregistered union, it acquires no legal personality and is not entitled to the rights and privileges
granted by law to legitimate labor organizations upon issuance of the certificate of registration.
Article 234 of the New Labor Code specifically provides:

Art. 234. Requirements of Registration.—Any applicant labor organization,

association, or group of unions or workers shall acquire legal personality and shall be
entitled to the rights and privileges granted by law to legitimate labor organizations
upon issuance of the certificate of registration. ....

In Phil. Association of Free Labor Unions vs. Sec. of Labor, 27 SCRA 40, We had occasion to
interpret Section 23 of R.A. No. 875 (Industrial Peace Act) requiring of labor unions registration by
the Department of Labor in order to qualify as "legitimate labor organization," and We said:

The theory to the effect that Section 23 of Republic Act No. 875 unduly curtails the
freedom of assembly and association guaranteed in the Bill of Rights is devoid of
factual basis. The registration prescribed in paragraph (b) of said section 17 is not a
limitation to the right of assembly or association, which may be exercised with or
without said registration. 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 or workers are engaged affect public interest, which should
be protected.

Simply put, the Amigo Employees Union (Independent) Which petitioners claim to represent, not
being a legitimate labor organization, may not validly present representation issues. Therefore, the
act of petitioners cannot be considered a legitimate exercise of their right to self-organization.
Hence, We affirm and reiterate the rationale explained in Phil Association of Free Labor Unions vs.
Sec. of Labor case, supra, in order to protect legitimate labor and at the same time maintain
discipline and responsibility within its ranks.

The contention of petitioners that the new CBA concluded between Amigo Employees Union-PAFLU
and the Company on February 15, 1977 containing the union security clause cannot be invoked as
against the petitioners for offenses committed earlier than its conclusion, deserves scant
consideration. We find it to be the fact that the union security clause provided in the new CBA merely
reproduced the union security clause provided in the old CBA about to expire. And since petitioners
were expelled from Amigo Employees Union-PAFLU on March 28, 1982 upon denial of their Motion
for Reconsideration of the decision expelling them, the CBA of February 15, 1977 was already
applicable to their case. The "closed-shop provision" in the CBA provides:

All members of the UNION as of the signing of this Agreement shall remain members
thereof in good standing. Therefore, any members who shall resign, be expelled, or
shall in any manner cease to be a member of the UNION, shall be dismissed from
his employment upon written request of the UNION to the Company. (Art. III)
A closed-shop is a valid form of union security, and a provision therefor in a collective bargaining
agreement is not a restriction of the right of freedom of association guaranteed by the Constitution.
(Manalang, et al. vs. Artex Development Co., Inc., et al., L-20432, October 30, 1967, 21 SCRA 561).
Where in a closed-shop agreement it is stipulated that union members who cease to be in good
standing shall immediately be dismissed, such dismissal does not constitute an unfair labor practice
exclusively cognizable by the Court of Industrial Relations. (Seno vs. Mendoza, 21 SCRA 1124).

Finally, We reject petitioners' contention that respondent Minister committed error in law amounting
to grave abuse of discretion when he affirmed the conclusion made by the RO4 OIC, upholding the
legal applicability of the security clause of a CBA over alleged offenses committed earlier than its
conclusion and within the 60-day freedom period of an old CBA. In the first place, as We stated
earlier, the security clause of the new CBA is a reproduction or reiteration of the same clause in the
old CBA. While petitioners were charged for alleged commission of acts of disloyalty inimical to the
interests of the Amigo Employees Union-PAFLU in the Resolution of February 14, 1977 of the Amigo
Employees Union- PAFLU and on February 15, 1977 PAFLU and the Company entered into and
concluded a new collective bargaining agreement, petitioners may not escape the effects of the
security clause under either the old CBA or the new CBA by claiming that the old CBA had expired
and that the new CBA cannot be given retroactive enforcement. To do so would be to create a gap
during which no agreement would govern, from the time the old contract expired to the time a new
agreement shall have been entered into with the union. As this Court said in Seno vs. Mendoza, 21
SCRA 1124, "without any agreement to govern the relations between labor and management in the
interim, the situation would well be productive of confusion and result in breaches of the law by
either party. "

The case of Seno vs. Mendoza, 21 SCRA 1124 mentioned previously needs further citation of the
facts and the opinion of the Court, speaking through Justice Makalintal who later became Chief
Justice, and We quote:

It appears that petitioners other than Januario T. Seno who is their counsel, were
members of the United Seamen's Union of the Philippines. Pursuant to a letter-
request of the Union stating that they 'had ceased to be members in good standing'
and citing a closed shop clause in its bargaining agreement with respondent Carlos
A. Go Thong & Co., the latter dismissed said petitioners. Through counsel,
petitioners requested that they be reinstated to their former positions and paid their
backwages, otherwise they would picket respondents' offices and vessels. The
request was denied on the ground that the dismissal was unavoidable under the
terms of the collective bargaining agreement. ...

We, therefore, hold and rule that petitioners, although entitled to disaffiliate from their union and form
a new organization of their own, must, however, suffer the consequences of their separation from
the union under the security clause of the CBA.

WHEREFORE, IN VIEW OF ALL THE FOREGOING, the Order appealed from affirming the joint
decision of the OIC of Regional Office No. 4 in RO4-Case No. T-IV-3549-T and RO4 Case No. RD-
4-4088-77-T granting clearance to terminate petitioners as well as dismissing their complaint with
application for preliminary injunction, is hereby AFFIRMED. No costs.

SO ORDERED.

Makasiar (Chairman), Concepcion Jr., De Castro and Escolin JJ., concur.

Aquino, J., is on leave.

G.R. No. L-22228 February 27, 1969

PHILIPPINE ASSOCIATION OF LABOR UNIONS (PAFLU) SOCIAL SECURITY SYSTEM

EMPLOYEES ASSOCIATION-PAFLU, AL FAJARDO AND ALL THE OTHER MEMBERS AND
OFFICERS OF THE SOCIAL SECURITY AND EMPLOYEES ASSOCIATION-PAFLU, petitioners,
vs.
THE SECRETARY OF LABOR, THE DIRECTOR OF LABOR RELATIONS and THE REGISTRAR
OF LABOR ORGANIZATIONS, respondents.

Cipriano Cid and Associates and Israel Bocobo for petitioners.

Office of the Solicitor General Arturo A. Alafriz and Solicitor Camilo D. Quiason for respondents.

CONCEPCION, C.J.:

Petitioners pray for writs of certiorari and prohibition to restrain respondents, the Secretary of Labor,
the Director of Labor Relations and the Registrar of Labor Organizations, from enforcing an order of
cancellation of the registration certificate of the Social Security System Employees Association —
hereinafter referred to as the SSSEA — which is affiliated to the Philippine Association of Free Labor
Unions — hereinafter referred to as PAFLU — as well as to annul all proceedings in connection with
said cancellation and to prohibit respondents from enforcing Section 23 of Republic Act No. 875.
Petitioners, likewise, pray for a writ of preliminary injunction pending the final determination of this
case. In their answer, respondents traversed some allegations of fact and the legal conclusions
made in the petition. No writ of preliminary injunction pendente lite has been issued.

It appears that on September 25, 1963, the Registration of Labor Organizations — hereinafter
referred to as the Registrar — issued a notice of hearing, on October 17, 1963, of the matter of
cancellation of the registration of the SSSEA, because of:

1. Failure to furnish the Bureau of Labor Relations with copies of the reports on the finances
of that union duly verified by affidavits which its treasurer or treasurers rendered to said
union and its members covering the periods from September 24, 1960 to September 23,
1961 and September 24, 1961 to September 23, 1962, inclusive, within sixty days of the 2
respective latter dates, which are the end of its fiscal year; and

2. Failure to submit to this office the names, postal addresses and non-subversive affidavits
of the officers of that union within sixty days of their election in October (1st Sunday), 1961
and 1963, in conformity with Article IV (1) of its constitution and by-laws.

in violation of Section 23 of Republic Act No. 875. Counsel for the SSSEA moved to postpone the
hearing to October 21, 1963, and to submit then a memorandum, as well as the documents specified
in the notice. The motion was granted, but, nobody appeared for the SSSEA on the date last
mentioned. The next day, October 22, 1963, Manuel Villagracia, Assistant Secretary of the SSSEA
filed with the Office of the Registrar, a letter dated October 21, 1963, enclosing the following:

1. Joint non-subversive affidavit of the officers of the SSS Employees' Association-PAFLU;

2. List of newly-elected officers of the Association in its general elections held on April 29,
1963; and

3. Copy of the amended constitution and by-laws of the Association.

 Holding

1. That the joint non-subversive affidavit and the list of officers mentioned in the letter of Mr.
Manuel Villagracia were not the documents referred to in the notice of hearing and made the
subject matter of the present proceeding; and

2. That there is no iota of evidence on records to show and/or warrant the dismissal of the
present proceeding.

on October 23, 1963, the Registrar rendered a decision cancelling the SSSEA's Registration
Certificate No. 1-IP169, issued on September 30, 1960. Soon later, or on October 28, 1963, Alfredo
Fajardo, president of the SSSEA moved for a reconsideration of said decision and prayed for time,
up to November 15, within which to submit the requisite papers and data. An opposition thereto
having been filed by one Paulino Escueta, a member of the SSSEA, upon the ground that the latter
had never submitted any financial statement to its members, said motion was heard on November
27, 1963. Subsequently, or on December 4, 1963, the Registrar issued an order declaring that the
SSSEA had "failed to submit the following requirements to wit:

1. Non-subversive affidavits of Messrs. Teodoro Sison, Alfonso Atienza, Rodolfo Zalameda,

Raymundo Sabino and Napoleon Pefianco who were elected along with others on January
30, 1962.

2. Names, postal addresses and non-subversive affidavits of all the officers who were
supposedly elected on October (1st Sunday), of its constitution and by-laws.

and granting the SSSEA 15 days from notice to comply with said requirements, as well as
meanwhile holding in abeyance the resolution of its motion for reconsideration.

Pending such resolution, or on December 16, the PAFLU, the SSSEA, Alfredo Fajardo "and all the
officers and members" of the SSSEA commenced the present action, for the purpose stated at the
beginning of this decision, upon the ground that Section 23 of Republic Act No. 875 violates their
freedom of assembly and association, and is inconsistent with the Universal Declaration of Human
Rights; that it unduly delegates judicial power to an administrative agency; that said Section 23
should be deemed repealed by ILO-Convention No. 87; that respondents have acted without or in
excess of jurisdiction and with grave abuse of discretion in promulgating, on November 19, 1963, its
decision dated October 22, 1963, beyond the 30-day period provided in Section 23(c) of Republic
Act No. 875; that "there is no appeal or any other plain, speedy and adequate remedy in the ordinary
course of law"; that the decision complained of had not been approved by the Secretary of Labor;
and that the cancellation of the SSSEA's certificate of registration would cause irreparable injury.

The theory to the effect that Section 23 of Republic Act No. 875 unduly curtails the freedom of
assembly and association guaranteed in the Bill of Rights is devoid of factual basis. 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. 3 Furthermore, the obligation
to submit financial statements, as a condition for the non-cancellation of a certificate of registration,
is a reasonable regulation for the benefit of the members of the organization, considering that the
same generally solicits funds or membership, as well as oftentimes collects, on behalf of its
members, huge amounts of money due to them or to the organization. 4

For the same reasons, said Section 23 does not impinge upon the right of organization guaranteed
in the Declaration of Human Rights, or run counter to Articles 2, 4, 7 and Section 2 of Article 8 of the
ILO-Convention No. 87, which provide that "workers and employers, ... shall have the right to
establish and ... join organizations of their own choosing, without previous authorization"; that
"workers and employers organizations shall not be liable to be dissolved or suspended by
administrative authority"; that "the acquisition of legal personality by workers' and employers'
organizations, ... shall not be made subject to conditions of such a character as to restrict the
application of the provisions" above mentioned; and that "the guarantees provided for in" said
Convention shall not be impaired by the law of the land.

In B.S.P. v. Araos, 5 we held that there is no incompatibility between Republic Act No. 875 and the
Universal Declaration of Human Rights. Upon the other hand, the cancellation of the SSSEA's
registration certificate would not entail a dissolution of said association or its suspension. The
existence of the SSSEA would not be affected by said cancellation, although its juridical personality
and its statutory rights and privileges — as distinguished from those conferred by the Constitution —
would be suspended thereby.

To be registered, pursuant to Section 23(b) of Republic Act No. 875, a labor organization,
association or union of workers must file with the Department of Labor the following documents:

(1) A copy of the constitution and by-laws of the organization together with a list of all officers
of the association, their addresses and the address of the principal office of the organization;

(2) A sworn statement of all the officers of the said organization, association or union to the
effect that they are not members of the Communist Party and that they are not members of
any organization which teaches the overthrow of the Government by force or by any illegal or
unconstitutional method; and

(3) If the applicant organization has been in existence for one or more years, a copy of its
last annual financial report.

Moreover, paragraph (d) of said-Section ordains that:

The registration and permit of a legitimate labor organization shall be cancelled by the
Department of Labor, if the Department has reason to believe that the labor organization no
longer meets one or more of the requirements of paragraph (b) above; or fails to file with the
Department Labor either its financial report within the sixty days of the end of its fiscal year
or the names of its new officers along with their non-subversive affidavits as outlined in
paragraph (b) above within sixty days of their election; however, the Department of Labor
shall not order the cancellation of the registration and permit without due notice and hearing,
as provided under paragraph (c) above and the affected labor organization shall have the
same right of appeal to the courts as previously provided. 6

The determination of the question whether the requirements of paragraph (b) have been met, or
whether or not the requisite financial report or non-subversive affidavits have been filed within the
period above stated, is not judicial power. Indeed, all officers of the government, including those in
the executive department, are supposed, to act on the basis of facts, as they see the same. This is
specially true as regards administrative agencies given by law the power to investigate and render
decisions concerning details related to the execution of laws the enforcement of which is entrusted
thereto. Hence, speaking for this Court, Mr. Justice Reyes (J.B.L.) had occassion to say:

The objections of the appellees to the constitutionality of Republic Act No. 2056, not only as
an undue delegation of judicial power to the Secretary of Public Works but also for being
unreasonable and arbitrary, are not tenable. It will be noted that the Act (R.A. 2056) merely
empowers the Secretary to remove unauthorized obstructions or encroachments upon public
streams, constructions that no private person was anyway entitled to make because the bed
of navigable streams is public property, and ownership thereof is not acquirable by adverse
possession
(Palanca vs. Commonwealth, 69 Phil., 449).

It is true that the exercise of the Secretary's power under the Act necessarily involves
the determination of some question of fact, such as the existence of the stream and its
previous navigable character; but these functions, whether judicial or quasi-judicial, are
merely incidental to the exercise of the power granted by law to clear navigable streams of
unauthorized obstructions or encroachments, and authorities are clear that they are validly
conferable upon executive officials provided the party affected is given opportunity to be
heard, as is expressly required by Republic Act No. 2056, section 2. 7

It should be noted also, that, admittedly, the SSSEA had not filed the non-subversive affidavits of
some of its officers — "Messrs. Sison, Tolentino, Atienza, Zalameda, Sabino and Pefianca" —
although said organization avers that these persons "were either resigned or out on leave as
directors or officers of the union", without specifying who had resigned and who were on leave. This
averment is, moreover, controverted by respondents herein.

Again, the 30-day period invoked by the petitioners is inapplicable to the decision complained of.
Said period is prescribed in paragraph (c) 8 of Section 23, which refers to the proceedings for the
"registration" of labor organizations, associations or unions not to the "cancellation" of said
registration, which is governed by the abovequoted paragraph (d) of the same section.

Independently of the foregoing, we have repeatedly held that legal provisions prescribing the period
within which a decision should be rendered are directory, not mandatory in nature — in the sense
that, a judgment promulgated after the expiration of said period is not null and void, although the
officer who failed to comply with law may be dealt with administratively, in consequence of his
delay 9 — unless the intention to the contrary is manifest. Such, however, is not the import of said
paragraph (c). In the language of Black:

When a statute specifies the time at or within which an act is to be done by a public officer or
body, it is generally held to be directory only as to the time, and not mandatory, unless time
is of the essence of the thing to be done, or the language of the statute contains negative
words, or shows that the designation of the time was intended as a limitation of power,
authority or right. 10

Then, again, there is no law requiring the approval, by the Secretary of Labor, of the decision of the
Registrar decreeing the cancellation of a registration certificate. In fact, the language of paragraph
(d) of Section 23, suggests that, once the conditions therein specified are present, the office
concerned "shall" have no choice but to issue the order of cancellation. Moreover, in the case at bar,
there is nothing, as yet, for the Secretary of Labor to approve or disapprove, since petitioners,
motion for reconsideration of the Registrar's decision of October 23, 1963, is still pending resolution.
In fact, this circumstance shows, not only that the present action is premature, 11 but, also, that
petitioners have failed to exhaust the administrative remedies available to them. 12 Indeed, they could
ask the Secretary of Labor to disapprove the Registrar's decision or object to its execution or
enforcement, in the absence of approval of the former, if the same were necessary, on which we
need not and do not express any opinion.

IN VIEW OF THE FOREGOING, the petition herein should be, as it is hereby dismissed, and the
writs prayed for denied, with costs against the petitioners. It is so ordered.
lawphi1.nêt

Reyes, J.B.L., Dizon, Makalintal,. Zaldivar, Sanchez, Castro, Fernando, Capistrano, Teehankee and
Barredo, JJ., concur.
G.R. Nos. L-18778 and L-18779 August 31, 1967

UNITED SEAMEN'S UNION OF THE PHILIPPINES, petitioner,

vs.
DAVAO SHIPOWNERS ASSOCIATION, ANGTIONG SONS and/or RICARDO ANG, owner-
manager; ANGLIONGTO SONS and COMPANY, GARCIA WATER TRANSPORTATION, COURT
OF INDUSTRIAL RELATIONS, ET AL., respondents.

Carlos E. Santiago for petitioner.

M. B. Tuason for respondent Court of Industrial Relations.
C.E. Niturrada for respondent Davao Shipowners Association.
Paredes, Poblador, Cruz and Nazareno for respondent Maravilla.
Primo L. Ocampo for respondent Garcia Navigation Co.
A. R. Dominguez for other respondent.

MAKALINTAL, J.:

Review on certiorari of a decision of the Court of Industrial Relations.

The material facts are not disputed. On August 4, 1959 petitioner United Seamen's Union of the
Philippines (hereinafter referred to as USUP) presented a set of demands to respondent Davao
Shipowners Association (hereinafter referred to as Shipowners) representing respondent shipping
companies, for union recognition, union security, standardization of wages and other benefits. In its
answer, the Shipowners invited USUP's attention to the existence of a collective bargaining
agreement with the Davao Marine Association (hereinafter referred to as Association), to which all
the crewmen of their launches belonged. Since the Shipowners were bound by said collective
bargaining agreement until the end of that year (1959), it suggested that USUP first take the
necessary steps to be certified as the collective bargaining agent of the employees before they could
negotiate in connection with its proposals.

However, even before receiving the Shipowners' answer to its set of demands, USUP had filed with
Regional Office No. 8 of the Department of Labor of Davao City a notice of strike against all the
individual shipowners. The Chief of the Labor Operations Section of the Davao Regional Office
requested USUP and the Shipowners to a conference with a view to settling the conflict. On August
20, 1959 the USUP, the Shipowners and the Association reached an agreement and executed the
following covenant:

A. We, the undersigned representatives of the United Seamen's Union of the Philippines
(USUP) hereby withdraw the notice to strike against any and all members of the group
known as the Davao Shipowners Association that we filed on or about August 6, 1959;

B. We, the USUP, further undertake to preserve and observe the status quo with reference
to the normal and original operation practices of loading, unloading, departures, manning
and the performance of any and/or all jobs incident to the businesses of the members of the
said Shipowners' Association here in Davao City and in the outports of Davao province
which are their ports of call or may travel to and conduct their businesses;

C. We, the Davao Marine Association, hereby undertake to cooperate with the Davao
Shipowners' Association and the USUP in the observation and preservation of such
practices and conduct of the Shipowners' businesses, and in view of this covenant will
withdraw our complaint against the USUP, its officers, agents and other representatives
which is now Civil Case No. 3106 before Branch I of the Davao Court of First Instance;
 D. That the USUP hereby announces and binds itself that it will respect the contract between
the Davao Shipowner's Association and the Davao Marine Association until its expiry date
and will not in any manner cause the same to be impaired or disturbed, but will file a petition
with the Court of Industrial Relations for certification election to determine the issue of union
representation of the Shipowners' workers, and if we, the USUP, will be the one certified, we
will commence to bargain with Shipowner's Association after the said contract shall be
expired;

E. We, the Davao Shipowner's Association gladly give our conformity to the agreement of
both parties to observe and preserve the status quo on the above mentioned contract's
operation and the commitment of the USUP to have the CIR determine the issue of union
representation. 1äwphï1.ñët

As stipulated, USUP filed with the Court of Industrial Relations a petition for certification election to
determine the sole collective bargaining representative of all the workers and employees of
respondent shipping companies.

Meanwhile, subsequent to the covenant of August 20, the respondent shipping companies
separately served notices of termination of service upon sixty-four(64) employees, effective
December 31, 1959, for reasons ranging from stoppage of operations due to the death of a partner
to business losses and reversals.

Because of these notices of termination of service upon USUP members (who, admittedly, were also
members of the Association), USUP reported the matter to Regional Office No. 8 of the Department
of Labor in Davao City and requested at the same time the assistance of said office. The Regional
Office thereupon called the parties to a conference, but apparently it did not do much good, for in a
letter dated December 29, 1959 USUP formally notified the Regional Office, Department of Labor,
the City Mayor of Davao, the Chief of Police, the Philippine Constabulary, the Bureau of Customs
and the general public that they would declare a strike on January 1, 1960.

On February 11, 1960 the respondent shipping companies filed a petition for a writ of injunction
(Case No. 3-INJ-DB) with the court a quo, alleging that a restraining order was necessary "to
forestall substantial and irreparable damage to petitioners' (now respondents') properties and public
weal," citing specific acts of coercion, violence and illegal picketing being committed by defendants
(now petitioners).

On February 24, 1960 USUP filed an unfair labor practice case against herein respondents (Case
No. 49-ULP-DB), alleging that "while its petition for certification election is still pending consideration
before this Honorable Court, respondents herein by their respective officers interfered with and have
been interfering with their employees' guaranteed right to self-organization and discriminated and
have been discriminating against their respective employees, who are members of the complainant,
in regard to hire or tenure of office or condition of employment in order to deter organizational activity
amongst employees, to induce those already organized to drop from the rank, disrupt union morale
and ultimately to break up the complainant union . . .". The unfair labor case was apparently
predicated upon the dismissal of the USUP members from employment. The petition then proceeded
to enumerate the various acts of respondents which were claimed to be violations of section 4(a),
sub-sections (1), (2) and (4) of Republic Act 875. 1

After the respondent companies had filed their respective answers, the petition for injunction filed by
the Shipowners and the unfair labor case filed by the USUP were heard and tried jointly. On October
31, 1960 the court a quo issued the appealed order, the dispositive portion of which reads:
 FOR ALL THE FOREGOING CONSIDERATIONS, the USUP complaint for unfair labor
practice (Case No. 49-ULP-DB) dated February 24, 1960, against the respondent
Shipowners is hereby DISMISSED, while on the other hand, respondents' claim for moral
damages are also dismissed for want of jurisdiction together with other compensatory reliefs
for lack of sufficient substantial proof thereof. As the strike declared on December 31, 1959
is held illegal and unjustified, dismissal of all the active participants thereof is hereby
decreed. And as a consequence thereof, permanent injunction is hereby granted. For its
implementation, respondent USUP, Alvaro Trinidad, Vivencio Quilong-Quilong, Fernando
Bantillan, together with their agents and representatives, are permanently enjoined and
restrained from:

(1) Coercing or causing to be coerced, by means of violence, force, threat or intimidation any
employee or laborer of the petitioners herein, so as to prevent him, her or them from entering
Petitioners' properties at Sta. Ana Wharf, Davao City, with the view of operating the vessels
of petitioners, to put petitioners' business in normal operations;

(2) Instilling or causing to be instilled fear into the officials, supervisors, agents, employees,
guards and laborers of the herein petitioners or any person desiring to work for or deal in
business with petitioners;

(3) Unlawful impeding, obstructing, hampering or interfering with the business of petitioners,
particularly the loading and unloading of cargoes from and to their vessels;

(4) Molesting and harassing or causing to be molested or harassed the officials of petitioners
and their agents in protecting and conducting petitioners' properties and businesses;

(5) Barricading or in any way obstructing with odds and ends the gate and pathway leading
to and from the premises where the properties and vessels of petitioners are docked.

The Chief of Police of Davao City and the Commanding Officer of the Philippine
Constabulary and/or their authorized representatives are hereby directed to enforce this
DECISION upon receipt thereof without the least delay.

The principal question to be determined, resolution of which will actually dispose of the other
incidental issues presented, is: Did the Court of Industrial Relations gravely abuse its discretion, as
claimed, in declaring the strike staged by the members of the USUP unjustified and illegal?

The lower Court found that the strike staged by the USUP and the subsequent unfair practice case it
filed against the respondent companies were the culmination of a series of drastic moves designed
to compel respondents to recognize USUP as the employees' collective bargaining agent to the
exclusion of the Association with whom the Shipowners had an existing collective bargaining
agreement. In other words, they were the direct offshoot of a losing effort to have the USUP
recognized as the sole collective bargaining agent of the employees, an effort which suffered legal
infirmities from its inception. A number of circumstances strongly support this finding:

First, it must be noted that USUP filed its Notice of Strike even before it received the Shipowners'
answer to its set of demands. It seems that regardless of whether the Shipowners would be willing to
negotiate with USUP or not, USUP was already predisposed to go on with the strike. There could
only be one reason for USUP to anticipate the Shipowners' negative stand: USUP was aware of the
existence of a valid collective bargaining agreement between the Shipowners and the Association
which would operate as a legal bar for the Shipowners to entertain USUP's demands. Knowing as it
did that its demands could not be entertained by the Shipowners, USUP at that early stage could not
have had any legitimate excuse for seeking recognition as the sole collective bargaining agent of the
employees.

Second, in open contravention of the August 20 covenant, USUP completely disturbed and impaired
the status quoby going on strike pending resolution of its petition for certification election. That status
quo referred expressly "to the normal and original operating practices of loading, unloading,
departures, manning, and the performance of any and/or all jobs incident to the businesses of the
members of the said Shipowners Association." By striking, USUP had impaired or disturbed the
existing collective bargaining agreement between the Shipowners and the Association which
recognized "the right of the Employer to hire, promote and transfer and for legal cause suspend, lay-
off or discharge employees subject to the right of the union (referring to the Association) to
notification and to ask reconsideration of any action of the Employer in the premises." It should be
remembered in this connection that those who took part in the strike and picketing were also
members of the Association and hence were bound by the collective bargaining agreement. In
seeking to justify their action, USUP asserts that the strike it staged was a matter of "self-defense"
and/or "union survival", claiming that the respondent shipping companies were the first to violate the
covenant to preserve and observe the status quo by a concerted action in sending out notices of
dismissal or separation, all effective December 31, 1959 to the 64 USUP members.

It is at least doubtful that the Shipowners could have violated the covenant of August 20 for the
simple reason that it was not an active nor a principal party thereto. As the court a quo observed:

Perusal of the covenant of August 20, 1959 evidently shows that the fulfillment of all the
commitments and faithful observance of all the terms thereof fall upon the United Seamen's
Union of the Philippines (USUP) and the Davao Marine Association, who are the active and
principal parties thereto . . . the Davao Shipowners Association never made any specific and
categorical commitment except to, in the language of the covenant, "gladly give our
conformity to the agreement of both parties to observe and preserve the status quo on the
above-mentioned contract's operation and the commitment of the USUP to have the CIR
determine the issue of union representation". In effect, the covenant is bilateral and not
tripartite. It imposes no definite binding obligation to the Shipowners. The burden lies heavily
upon the USUP . . .

Even assuming arguendo that the shipping companies were also bound by the covenant, still the
termination of services of the affected employees could not be considered a violation of the
covenant. Sustained by the court a quo, in specific cases, was the companies' contention that the
dismissals made were predicated on legitimate reasons. After hearing and receiving the exhaustive
testimony and evidence of both sides, the lower court ruled:

Re: ANGTIONG SONS

It is completely established by the evidence that, with the exception of the crewmen of the
vessel MERCURY who received their termination notices on November 12, 1959 due to
sustained losses in the operating of the same, no tying up of the other vessels nor dismissal
of their respective crews were effected by respondent Antiong Sons. With respect to the
MERCURY, it is very evident from the termination notice that it was directed to the individual
crewmen of the same, as members of the (Association) and at the bottom thereof, it is noted
that copies of the same have been furnished the president of the Davao Marine Association
and the Department of Labor. In fact and in law, therefore the laying off was directed to the
crewmen of MERCURY as members of the Davao Marine Association and not as unionists
of the (USUP). As the Association was the one vitally affected for the mass laying off of said
crewmen with the substantial reduction of its membership and the respective collection of
 check-off dues, it should have been the militant complaining party, had it been convinced
that the total laying-off of its members in the MERCURY was anti-union, unreasonable and
unjustified under the circumstances.

xxx xxx xxx

The decommissioning of the MERCURY followed by the announcement of its sale and finally
its disposal by purchase, fully negate complainant's charge of unfair labor practice against
respondent. It can be construed as a legitimate exercise of its rights and prerogative under
the "Management of Labor Force" provision of the collective bargaining agreement dated
December 28, 1957 between the Shipowners and the Association providing as follows:

"The operation and direction of working forces and the management of the business
shall be vested exclusively in the EMPLOYER, including the right to hire, promote,
and transfer and for legal cause, to suspend, lay-off or discharge employees. The
UNION shall be notified in case of suspension, lay-off, or discharge of any of its
members. Should the UNION consider the suspension, lay-off or discharge unlawful,
it may seek reconsideration from the EMPLOYER and should the latter maintain its
stand, the matter maybe taken up with the court so vested with jurisdiction to settle
the controversy."

PREMISES CONSIDERED, complainant's particular charges of unfair labor practice against Antiong
Sons are hereby dismissed.

With respect to Southern Navigation Company, the court a quo found that the strike declared against
it was a sympathy strike; that the crew and officers of the EMPRESS OF DAVAO and the ANHAI
were given termination notices because the company was dissolved after the death of one of its
principal partners; and that the cessation of the operation of the two vessels was not motivated by
any anti-union feeling. As in the Antiong case, the notice of termination was addressed not to the
USUP but to the Association, by virtue of the collective bargaining agreement with it.

As to Vicente Yu Water Transportation, the court a quo observed that "the contents of said
termination notices clearly state that the planned cessation of operation (of the (M/L WATSON and
M/L RIZAL) . . . are (sic) but temporary in character, aside from the fact that said notices were
addressed to all the crewmen and officers as members of the Association and not of USUP."
Accordingly, the same conclusion as in the above stated cases was reached.

With respect to Joyce Enterprises, Anglionto Sons & Co., Garcia Water Transportation and Garcia
Navigation, the court a quo correctly analyzed the situation, thus:

If it was really true that respondents had any abiding hostility against the USUP or any
intention to bust the same by dismissing or locking-out their respective personnel who joined
said union, investigation should have been done after USUP sent its demand letter on
August 4, 1959 manifesting its majority representation and requesting for recognition and
bargaining rights to negotiate for its items of demand contained therein, or after it filed its
Notice of Strike with the Regional Office of the Department of Labor in Davao on August 6,
1959, or, by natural reaction the Shipowners should have dismissed all Association members
(who were also USUP members) who refused to work on their vessels from August 13, 1959,
through the instigation of USUP, which was charged of contempt of court for violating the
Injunction order dated August 16, 1959. That was the most opportune moment for the
Shipowners to rightly charge Association members of violating their contractual duties and
obligations under the Collective Bargaining Agreement of December 28, 1957 and of
 dismissing them without notice and without recourse in the exercise of its managerial powers
and prerogatives under said contract and under the law. In spite of such affront and clear
violation of their rights, none such retaliatory acts were done by any of the respondent
Shipowners . . .

We find no urgent reason to take issue with the conclusions reached by the court a quo, considering
that petitioner does not now question the veracity of the facts on which the conclusions are based.

Third, the existence of a collective bargaining agreement should have been sufficient to deter USUP
from acts tending to force the issue of union recognition. The pertinent provisions of said agreement
read:

VI — GRIEVANCE AND HEARING COMMITTEE

A "Grievance Committee" shall be created, composed of three (3) members of the UNION,
one of whom shall be in the service of the EMPLOYER, the names of whom shall be
furnished to the said employer. All grievance of UNION members in the service of the
EMPLOYER shall be coursed through the aforementioned grievance committee, which shall
take up the same with a "Hearing Committee" composed of three members to be chosen by
the EMPLOYER.

Any grievance or dispute which cannot be settled by a conference of both grievance and
hearing committees, shall be referred to the Court of Industrial Relations or any other Court
of competent jurisdiction for final determination. Pending such determination it is agreed by
the parties that no strike, slow down of work or lockout shall be declared by either the UNION
or the EMPLOYER.

Undoubtedly, the parties adopted a graduated procedure in the settlement of their labor disputes
because of their desire to maintain harmonious relations and prevent as much as possible the
declaration of a strike, which in the last analysis works adversely to both capital and labor.

The employees concerned who after all were bound by the collective bargaining agreement, as
members of the Association, totally disregarded, the procedure laid down therein by immediately
going on strike without coursing their complaints through the grievance committee for possible
settlement. Having failed to take advantage of a legal right granted them under the agreement, they
are in no position to demand relief from the consequences of their own impulsive acts.

The authorities are numerous which hold that strikes held in violation of the terms contained
in a collective bargaining agreement are illegal, specially when they provide for conclusive
arbitration clauses. These agreements must be strictly, adhered to and respected if their
ends have to be achieved. (Liberal Labor Union vs. Phil. Can Co., 91 Phil. 72, 78).

The unlicensed crew-members contravened the collective bargaining agreement not because they
affiliated with the USUP but because they were remiss in complying with their obligations and duties
as members of the Association, the employees' collective bargaining representative.

Fourth, even assuming again that the purpose for which the strike was staged was valid, still the fact
remains that the means employed were far from legitimate. In the hearing of the injunction case
(Case No. 3-INJ-DB), the factual findings of the court a quo reveal the following:
The USUP struck at about 8:00 in the evening of December 31, 1959. Led by Alvaro Trinidad
and other respondents, some 300 strikers formed a human cordon alongside the Sta. Ana
wharf and blocked all ways and approaches to the launches and vessels of Petitioners. The
loading and unloading of some boats of the Petitioners, then docked at the Sta. Ana wharf,
were obstructed by the strikers, not only by the employment of human fence but also by acts
of violence and coercion. At the inception of the strike, some boats were already loaded with
perishable commodities destined for the gulf and coastal towns of Davao, which departure
was also rendered impossible due to the impregnability of the human wall placed by the
strikers blocking the egress and ingress to the said vessels. . . .

the strikers, thru force and coercion, took possession of the Shipowners' vessels on several
occasions. The "lanchita" of the M/V ALFONSO, vessel belonging to Angliong to Sons & Co.,
was taken by the strikers on January 4, 1960 without the owner's consent and used it to ferry
themselves to the M/L MA. LUISA, launch of Joyce Enterprises, at the midstream where they
remained and refused to leave in spite of appeals made by the owner and officers of said
vessel. . . . Also on January 7, 1960, some of the strikers took possession of the M/L
COLUMBIAN, launch owned by Joyce Enterprises, that was anchored upstream sans prior
permission from its owner. . . . Again, on January 18, 1960, thirteen (13) identified strikers
were caught red-handed in possession of the "bote" of the M/V ISABEL, also of the Joyce
Enterprises, without authority from its owner. . . .

Acts of intimidation, coercion and violence punctuated the conduct of the strike. On January
2, 1960, when about 19 stevedores, led by Celestino Cañete, attempted to install a 2 by 9
feet gang-plank on the M/V ISABEL to unload its cargoes, strikers grabbed the gang-plank
and pushed it against the bodies of said stevedores who fell to the ground and suffered
physical injuries, thereby preventing the unloading of the cargoes. . . .

On January 4, 1960, as the "lanchita" theft, committed by the strikers, was being investigated
at the wharf by Captain Mumungan, P.C. in-charge of the strike area, at the instance of
William Joyce, one of the shipowners, Alvaro Trinidad challenged frontally William Joyce to a
fight in the presence of said peace officer supposedly to settle the strike. . . . On January 14,
1960, Blas Nicase and the crew of the M/L MALITA, Garcia Navigation's launch, were
prevented against their will from performing their duties. As they were waiting for the "bote"
of that launch to come alongside the pier to take them and the crew aboard, the men on the
"bote" who were non-strikers were subjected to scurrilous remarks and were warned that if
they come nearer, they (the strikers) would get hold of the "bote" and submerge them into
the water. Fearing physical harm the "bote" withdrew. Nicase and his co-workers were
themselves surrounded and rendered immobile by the husky and menacing strikers. The rest
of the crew, greatly outnumbered and intimidated, were blocked by a human wall and were
not able to get into the "bote". . . .

Benedicto Erespe, the patron of the M/L MARIA LUISA corroborated the above testimony of
Mr. Joyce and further testified that when he was about to board that boat on the night of
January 8, 1960, the respondent union president and his confederates, aided by some husky
men, surrounded him and stopped him from going aboard. He was threatened with bodily
harm if be persisted in going up the boat so that he had to desist from complying with his job-
duties and reported to the police. However, the perpetrators of the said illegal acts whom he
clearly identified and who are always in the vicinity of the Sta. Ana Wharf have not been
apprehended by the police.

Celso Villodres and Eliodoro Cervantes, Chief mate and marine engineer, respectively, of the
motor launch COLUMBIAN were prevented, in the same manner as Captain Erespe was
prevented from performing his work, against their will. They were warned by Mr. Trinidad and
his confederates that something evil will befall them if they insisted on boarding the vessels.
Alvaro Trinidad on that occasion shouted at Captain Erespe while shaking clenched fists at
the latter that he was a bootlicker and that something will surely happen to him if he boarded
the vessel. As they were encircled by strikers, they refrained from insisting to do their work
and reported these threats, coercion and intimidation to the police who have done nothing up
to the present time.

To crown the already mentioned commission of acts of threats, intimidation, coercion and
invasion of shipowners' property rights, in the evening of January 13, 1960, Pablo Sisa, a
non-striker, employee of the M/V ALFONSO was mauled by six husky strikers upon orders of
Alvaro Trinidad. It appears that Pablo Sisa was ordered by management of the Angliongto to
pull and tie the rope of the M/V APOLLO, Antiong Sons' at about 6:30 p.m. While aboard, he
was told by Alvaro Trinidad in the presence of his husky men, to go down or else something
evil will happen to him. Angered by Sisa's stand, Trinidad made a sign with his head to his
men, then around him to follow Sisa on his way out of the pier. On his way home, along
Uyanguren St., Sisa was intercepted by six men. His hands were pinned, legs were grabbed
tight and was socked on the left side of the nose, left cheek bone, left ear and left collar bone
and kicked while lying prostrate on the pavement. His blue shirt and handkerchief were
smeared with blood oozing from his nose. During the incident no people were around neither
were there peace officers within the vicinity. He was hospitalized. The local public hospital
physician identified the victim in favor of whom the medical certificate was issued.

Similar acts to the aforementioned continued to be perpetrated by the strikers, their agents
and representatives after the expiration of the January 31, 1960 temporary injunction,
whenever opportunities were afforded them.

On January 31, 1960, when the M/L MALITA was unloading its cargoes at Talomo Beach,
which is around 8 kms. from the heart of the City of Davao, a truck-load of strikers and their
agents led by Trinidad, numbering around eighty, resumed picketing. Strikers wading in the
water at waist-line deep, in several groups, took turns in pushing the "bote" of the M/L
MALITA away from the beach in as many times as there were attempts to approach the
beach to unload cargoes. It was during this occasion that the strikers untied the launch's
anchor causing the vessel to drift into the gulf thus successfully prevented the unloading.
This occasion was also the setting of the incident wherein Manuel Garcia, owner of the
above-cited launch, was physically pushed by the elbows of husky strikers within sight of
Alvaro Trinidad and P.C. Captain Mumungan who did nothing to arrest the culprits.

On February 3, 1960, several attempts of Manuel Garcia, owner of petitioner Garcia Water
Transportation and Cañete together with his stevedores, to install the gangplank from the
Sta. Ana pier on M/L MALITA preparatory to the unloading of its cargoes, were blocked by
the respondents and their agents. The one hundred fifty strikers more or less formed one
long unbroken line on the edge of the pier, from bow to stern of the above launch, and a
horde of men, three to four men deep marched to and fro in close formation to insure that no
person or object would ever get to the vessel despite the pleas of Cañete and his twenty five
(25) odd men to allow them to unload the launch. The strikers grabbed the gangplank,
carried by some stevedores and pushed this hard twice against the latter causing injuries to
two stevedores, namely, Tecson and Vargas who in turn were hospitalized. This treatment
by a government physician is evidenced by Exhibits AA and BB, respectively. Dr. Renato
Montenegro, after identifying the documents and the victims, testified that only an exterior
force could possibly cause the physical injuries on the two patients. . . .
 Aside from these acts, the strikers not only shouted slanderous and scurrilous words against
the owner of the vessels but also hurled threatening remarks at the non-strikers. Fear was
instilled in the minds of non-strikers and owners of the vessels.

To the above continuously perpetrated illegal acts and activities of the strikers, their agents
and representatives, several witnesses gave corroborative testimonies including the City
Fiscal, P.C. Captain in-charge of the strike-bound area and several police officers and men
of the Sta. Ana district.

Respondents' witnesses and other evidence available miserably failed to offset and discredit
the more credible testimonies of the City Fiscal and the peace officers called upon by the
court to shed light on the conduct and manner the strike was prosecuted.

xxx xxx xxx

The foregoing findings are supported by substantial evidence in the record, and petitioner itself does
not question their veracity. Besides, they are matters which involve the credibility and weight of the
evidence and which are primarily address to the appreciation of the trial court.

In cases not falling within the prohibition against strikes, the legality or illegality of a strike
depends first, upon the purpose for which it is maintained, and, second, upon the means
employed in carrying it on. Thus, if the purpose which the laborers intend to accomplish by
means of a strike is trivial, unreasonable or unjust (as in the case of the National Labor
Union vs. Philippine Match Co., 70 Phil. 300), or if in carrying on the strike the strikers should
commit violence or cause injuries to persons or damage to property (as in the case of
National Labor Union, Inc. vs. Court of Industrial Relations, et al., 68 Phil. 732), the strike,
although not prohibited by injunction, may be declared by the court illegal, with the adverse
consequences to the strikers." (Luzon Marine Dept. Union vs. Roldan, 86 Phil. 507, 513).

Where, "in carrying out the strike, coercion, force, intimidation, violation with physical injuries,
sabotage and the use of unnecessary and obscene language or epithets were committed by the top
officials and members of the union in an attempt to prevent the other willing laborers to go to work," it
was held that "a strike hold under those circumstances cannot be justified in a regime of law for that
would encourage abuses and terrorism and could subvert the very purpose of the law which
provides for arbitration and peaceful settlement of labor disputes." (Liberal Labor vs. Phil.
Can, supra).

A labor organization is wholesome if it serves its legitimate purpose of promoting the interests of
labor without unnecessary labor disputes. That is why it is given personality and recognition in
concluding collective bargaining agreements. But if it is made use of as a subterfuge, or as a means
to subvert valid commitments, it defeats its own purpose, for it tends to undermine the harmonious
relations between management and labor. The situation does not deserve any approving sanction
from the Court.

In view of our conclusion that the strike staged by petitioner USUP was illegal and unjustified and
that the permanent injunction issued by the lower court was proper, we deem it unnecessary to
consider the other incidental issues presented by petitioner. The decision appealed from is affirmed,
with costs.

Concepcion, C.J., Reyes, J.B.L., Dizon, Bengzon, J.P., Zaldivar, Sanchez, Castro, Angeles and
Fernando, JJ., concur.
G.R. Nos. 64821-23 January 29, 1993

UNIVERSITY OF PANGASINAN FACULTY UNION, petitioner,

vs.
NATIONAL LABOR RELATIONS COMMISSION and UNIVERSITY OF
PANGASINAN, respondents.

Tanopo & Serafica for petitioner.

Hermogenes S. Decano for private respondents.

ROMERO, J.:

In the instant petition for mandamus and certiorari, petitioner union seeks to enjoin the respondent
National Labor Relations Commission (NLRC) to resolve, or direct the Labor Arbiter to hear and
decide, the merits of three of petitioner's unresolved complaints, and to annul and set aside the
resolution of the NLRC affirming the decision of the Executive Labor Arbiter dismissing the
petitioner's complaints for violation of certain labor standards laws but requiring respondent
university to integrate the cost of living allowance into the basic pay of the covered employees and
reminding it to pay its employees at intervals not exceeding sixteen (16) days.

The uncontroverted facts show that on various dates, petitioner filed the following complaints against
the University of Pangasinan (University for brevity) before the Arbitration Branch of the NLRC in
Dagupan City:

1. October 14, 1980: for nonpayment of benefits under P.D. No. 1713 and
emergency cost of living allowance (ecola) to part-time teachers, and for prompt and
accurate computation of benefits under P.D. No. 451 and the payment of ecolas;

2. November 7, 1980: for nonpayment of all ecolas to instructors from October 18-31,
1980;

3. November 20, 1980: for nonpayment of ecolas under P.D. Nos. 525, 1123, 1614,
1634, 1678 and 1713 for November 1-15, 1980, and extra loads during typhoons
"Nitang" and "Osang" on July 21 and 25, 1980, respectively;

4. April 13, 1981: for violation of P.D. No. 1751 and nonpayment of extra loads on
February 12-13, 1980 (Anniversary celebration);

5. April 27, 1981: for nonpayment of all ecolas for April 1-15, 1981 to faculty
members who were also members of the union;

6. May 21, 1981: for violation of Wage Order No. 1 and delayed payment of salaries;
and

7. June 17, 1981: for nonpayment of salary differentials for summer under P.D. No.
451.1
The Regional Director in San Fernando, La Union certified six (6) of these complaints to Labor
Arbiter Pedro Fernandez of the Dagupan City District Office of the then Ministry of Labor and
Employment for compulsory arbitration. 2 According to the petitioner, it was made to understand by
Fernandez that the seventh complaint should also be discussed in its position paper. Accordingly,
petitioner filed a position paper discussing the merits of all the seven complaints. On the other hand,
the University limited its discussion to only four: the complaints filed on April 13, 1981, April 27,
1981, May 21, 1981 and June 17, 1981. Petitioner was of the view that Executive Labor Arbiter
Sotero L. Tumang adopted the stand of the University on the four complaints and accordingly
dismissed them in his decision of January 25, 1982. 3

Observing that in its position paper, the petitioner included matters which were "beyond the scope of
the issues alleged in the complaints," said Labor Arbiter discussed the four complaints individually.
On the April 13, 1981 complaint, he ruled that because at the time P.D. No. 1123 took effect on May
1, 1977, the University had not increased its tuition fees, there was of "nothing to
integrate."4 However, from June 16, 1979 when the University increased its tuition fees, it was
obligated to cause the integration of the across-the-board increase of P60.00 in emergency
allowance into the basic pay as mandated by P.D. Nos. 1123 and 1751.

On the alleged nonpayment of extra loads handled by the employees on February 12 and 13, 1981
when classes were suspended, Tumang stated that Consuelo Abad, the petitioner's president, had
no cause to complain because her salary was fully paid and that, since there were "no complainants
for the alleged nonpayment of extra loads for two days," the issue had become academic.

With respect to the April 27, 1981 complaint, Tumang said that since the salary paid to Consuelo
Abad and other faculty members for the April 1-15, 1981 period had been earned "as part of their
salary for the ten-month period," she was no longer entitled to an emergency cost of living
allowance. He added that "payment of emergency cost of living allowance is based on actual work
performed except when they (employees) are on leave with pay." Hence, because classes ended in
March 1981, the teachers who did not report for work could not be considered on leave with pay
and, therefore, they were not entitled to an emergency cost of living allowance.

As regards the May 21, 1981 complaint alleging violation of Wage Order No. 1, Tumang found that
the University had actually implemented the additional living allowance of P2.00 a day required
therein. On the alleged delay in the payment of salaries of the employees, he rationalized that delays
could not be avoided but he reminded the University to pay its employees on time.

The June 17, 1981 complaint was also resolved in favor of the University. Stating that P.D. No. 451
which mandates salary increases is dependent on enrollment and allowable deductions, Tumang
ruled that, again, Consuelo Abad had no cause to complain as she had been paid out of the
allowable 12.74% for distribution which was a "substantial compliance with P.D. No. 451." 5 The
dispositive portion of the decision states:

IN THE LIGHT OF THE FOREGOING CONSIDERATION, the above-entitled cases

are dismissed for lack of merit. Respondent however, is required to integrate the
allowance of P60.00 under P.D. 1123 into the basic pay of the covered employees if
the same has not as yet been complied with. Respondent is also reminded to pay the
employees at intervals not exceeding sixteen (16) days pursuant to Article 102 of the
Labor Code.

SO ORDERED.
The petitioner appealed the said decision to the NLRC. In its resolution of June 20, 1993, the NLRC
affirmed the decision of Executive Labor Article Tumang. Hence, the instant petition
for mandamus and certiorari with the following prayer:

WHEREFORE, the foregoing premises considered, it is respectfully prayed that this

petition be given due course and that judgment issue:

1. Declaring petitioner as possessed with capacity to represent its members in the

complaints it filed thru its president, Miss Consuelo Abad, against private respondent,
and the complaints are pertaining to the members who are entitled under the law to
the claims sought herein, not to Miss Abad alone;

2. Annulling and setting aside the appealed resolution insofar as the issues of
nonpayment of Ecola for April 1-15, 1981 and nonpayment of salary differentials for
summer of 1981 under P.D. No. 451 are concerned;

3. Ordering private respondent to pay covered members of petitioner their Ecola for
April 1-15, 1981 and their salary differentials for summer of 1981 pursuant to the
mandate of P.D. 451;

4. Enjoining public respondent to resolve on the merits the issues of nonpayment of

extra loads of February 12-13, 1980 and violation of Wage Order No. 1 which were
properly brought on appeal to said office;

5. Enjoining public respondent to resolve on the merits the issues or grievances

alleged in the complaints filed on October 14, November 7 and November 20, all in
1980, which were not resolved by the labor arbiter but nonetheless appealed to
public respondents, or

6. Enjoining public respondent to order or direct the labor arbiter to resolve on the
merits the said issues or grievances alleged in the complaints mentioned in the next
preceding paragraph;

7. Attorney's fee in such amount as this Honorable Tribunal may deem just and
reasonable in the premises;

8. Ordering private respondent to pay costs of suit, including this appeal.

Petitioner further prays for safeguards and/or measures to insure the correct
computation of the amount of claims herein sought due to each covered member of
petitioner, and for such other reliefs just and equitable in the premises. 6

We shall first deal with the propriety of the special civil action of mandamus. In this regard, petitioner
contends that the NLRC should have, in the exercise of its appellate jurisdiction, resolved the issues
raised in the three (3) complaints filed on October 14, November 7 and November 20, 1980 or, in the
alternative, ordered the Labor Arbiter to hear and decide the aforementioned three (3) complaints, it
having the power of supervision over Labor Arbiters.

Sec. 3, Rule 65 of the Rules of Court provides:

 Sec. 3. Petition for Mandamus. — When any tribunal, corporation, board, or person
unlawfully neglects the performance of an act which the law specifically enjoins as a
duty resulting from an office, trust, or station, or unlawfully excludes another from the
use and enjoyment of a right or office to which such other is entitled, and there is no
other plain, speedy and adequate remedy in the ordinary course of law, the person
aggrieved thereby may file a verified petition in the proper court alleging the facts
with certainty and praying that judgment be rendered commanding the defendant,
immediately or at some other specified time, to do the act required to be done to
protect the rights of the petitioner, and to pay the damages sustained by the
petitioner by reason of the wrongful acts of the defendant.

As succinctly provided in this section, anyone who wishes to avail of the remedy of mandamus must
state in a verified petition "the facts with certainty." On account of this requirement, mandamus is
never issued in doubtful cases and showing of a clear and certain right on the part of the petitioner is
required. 7 Indeed, while the labor arbiter is duty bound to resolve all complaints referred to him for
arbitration and, therefore, he may be compelled by mandamus to decide them (although not in any
particular way or in favor of anyone),8 we find that the peculiar circumstances in this case do not
merit the issuance of the writ of mandamus.

Petitioner admits that only six of the complaints were certified to Labor Arbiter Fernandez for
compulsory arbitration. It failed, however, to allege why this was the case or whether it had exerted
any effort to include the remaining complaint in the certification. What it stresses is the alleged
assurance of Labor Arbiter Fernandez that the seventh complaint may be discussed in its position
paper. It turned out, however, that, according to the unrebutted allegation of the Solicitor General,
Labor Arbiter Fernandez inhibited himself from handling the cases referred to him as he was
teaching at the University. Hence, Labor Arbiter Fernandez forwarded the complaints to the
Assistant Director for Arbitration in Regional Office No. 1 in San Fernando, La Union for appropriate
action. He should have forwarded all of the complaints to the said Assistant Director, but it appears
that Fernandez turned over only four of them. In turn, the Assistant Director referred only complaints
Nos. 5, 6 and 7, which had been docketed as RBI-C-24-81, LS-42-81 and LS-43-81, to Executive
Labor Arbiter Sotero L. Tumang for compulsory arbitration. However, while only these three docket
numbers appear on the caption of the decision, the same actually resolved four complaints, as
earlier mentioned. 9

From these facts, one may infer that there must have been a mishandling of the complaints and/or
the records of the cases. However, the petitioner failed to substantiate by evidence such negligence
on the part of the public respondents as to warrant the issuance of a writ of mandamus. 10 Its officials
even neglected the simple act of verifying from the MOLE office in Dagupan City whether the
records of all the cases filed had been forwarded to the proper official who should resolve
them. 11 Infact, nowhere in its pleadings 12 is there an allegation to that effect.

On the contrary, the petitioner took Fernandez' words seriously and allowed the proceedings to
reach its inevitable conclusion. When it received a copy of the decision, the petitioner should have
taken note of Executive Labor Arbiter Tumang's observation therein that it had discussed matters
"beyond the scope of the issues alleged in the complaints." In its memorandum of appeal, it should
have prayed for the inclusion of the three complaints inasmuch as in labor cases, an appeal may be
treated as a motion for reconsideration or
vice-versa. 13 The fact that three complaints had been omitted did not escape the attention of the
NLRC which stated in its resolution that "since those cases were not consolidated it is now too late
to consolidate them" with the four decided cases. 14 We agree with the NLRC that the said
complaints should proceed separately as long as their resolution would not conflict with the resolved
cases.15 It should be added that under Art. 217(b) of the Labor Code, the NLRC has "exclusive
appellate jurisdiction over all cases decided by the Labor Arbiters." Needless to say, the NLRC could
not have acted on matters outside of the cases appealed to it.

Petitioner's contention that the cases filed by Consuelo Abad as its president should affect, not only
herself, but all the other union members similarly situated as she was, is well taken. The
uncontroverted allegation of the petitioner is that it is the holder of Registration Certificate No. 9865-
C, having been registered with the then Ministry of Labor and Employment on February 16, 1978. As
such, petitioner possessed the legal personality to sue and be sued under its registered
name.16 Corollarily, its president, Consuelo Abad, correctly filed the complaints even if some of them
involved rights and interest purely or exclusively appertaining to individual employees, it appearing
that she signed the complaints "for and in behalf of the University of Pangasinan Faculty Union." 17

The University's contention that petitioner had no legal personality to institute and prosecute money
claims must, therefore, fail. To quote then Associate Justice Teehankee in Heirs of Teodelo M. Cruz
v. CIR,18 "[w]hat should be borne in mind is that the interest of the individual worker can be better
protected on the whole by a strong union aware of its moral and legal obligations to represent the
rank and file faithfully and secure for them the best wages and working terms and conditions. . . .
Although this was stated within the context of collective bargaining, it applies equally well to cases,
such as the present wherein the union, through its president, presented its individual members'
grievances through proper proceedings. While the complaints might not
have disclosed the identities of the individual employees claiming monetary benefits, 19 such technical
defect should not be taken against the claimants, especially because the University appears to have
failed to demand a bill of particulars during the proceedings before the Labor Arbiter.

On the merits of the petition, the NLRC did not abuse its discretion in resolving the appeal from the
decision of Executive Labor Arbiter Tumang except for the disallowance of the emergency cost of
living allowance to members of the petitioner. The Rules Implementing P.D. No. 1713 which took
effect on August 18, 1980 provide:

Sec. 6. Allowances of full-time and part-time employees. — Employees shall be paid

in full the monthly allowance on the basis of the scales provided in Section 3 hereof,
regardless of the number of their regular working days if they incur no absences
during the month. If they incur absences without pay, the amounts corresponding to
the absences may be deducted from the monthly allowance provided that in
determining the equivalent daily allowance of such deduction, the applicable monthly
allowance shall be divided by thirty (30) days.

xxx xxx xxx

(Emphasis supplied).

This Section, which is a virtual reproduction of Section 12 of the old Rules Implementing P.D. No.
1123, has been interpreted by this Court as requiring that the full amount of the cost of living
allowance mandated by law should be given monthly to each employee if the latter has worked
continuously for each month, regardless of the number of the regular working days. 20 But
more apropos is the ruling of this Court in University of Pangasinan Faculty Union v. University of
Pangasinan and NLRC,21 a case involving the same parties as in the instant petition and dealing with
a complaint filed by the petitioner on December 18, 1981 seeking, among others, the payment of
emergency cost of living allowances for November 7 to December 5, 1981, a semestral break. The
Court held therein:
 . . . The "No work, no pay" principle does not apply in the instant case. The
petitioner's members received their regular salaries during this period. It is clear from
the . . . law that it contemplates a "no work" situation where the employees voluntarily
absent themselves. Petitioners, in the case at bar, certainly do not, ad
voluntatem absent themselves during semestral breaks. Rather, they are constrained
to take mandatory leave from work. For this, they cannot be faulted nor can they be
begrudged that which is due them under the law. To a certain extent, the private
respondent can specify dates when no classes would be held. Surely, it was not the
intention of the framers of the law to allow employers to withhold employee benefits
by the simple expedient of unilaterally imposing "no work" days and consequently
avoiding compliance with the mandate of the law for those days.

As interpreted and emphasized in the same case, the law granting emergency cost of living
allowances was designed to augment the income of the employees to enable them to cope with the
rising cost of living and inflation. Clearly, it was enacted in pursuance of the State's duty to protect
labor and to alleviate the plight of the workers. To uphold private respondent's interpretation of the
law would be running counter to the intent of the law and the Constitution.

WHEREFORE, the petition for mandamus is hereby DISMISSED. The decision of the NLRC is
AFFIRMED subject to the MODIFICATION that private respondent University of Pangasinan shall
pay its regular and fulltime teachers and employees emergency cost of living allowance for the
period April 1-15, 1981. Costs against private respondent.

SO ORDERED.
G.R. No. L-30241 June 30, 1972

MACTAN WORKERS UNION and TOMAS FERRER, as President thereof, plaintiffs-appellees,

vs.
DON RAMON ABOITIZ, President, Cebu Shipyard & Engineering Works, Inc.; EDDIE LIM, as
Treasurer; JESUS DIAGO, Superintendent of the aforesaid corporation; WILFREDO VIRAY, as
Resident Manager of the Shipyard & Engineering Works, Inc.; and the CEBU SHIPYARD &
ENGINEERING WORKS, INC., defendants-appellees; ASSOCIATION LABOR
UNION, intervenor-appellant.

Andales Law Office for plaintiffs-appellees.

Pedro B. Uy Calderon for defendants-appellees.

Seno, Mendoza & Associates for intervenor-appellant.

FERNANDO, J.:p

The dispute in this appealed decision from the Court of First Instance of Cebu on questions of law is between plaintiff Mactan Workers
Union1 and intervenor Associated Labor Union. The former in its complaint on behalf of seventy-two of its members working in defendant
corporation, Cebu Shipyard and Engineering Works, Inc.2 did file a money claim in the amount of P4,035.82 representing the second
installment of a profit-sharing agreement under a collective bargaining contract entered into between such business firm and intervenor labor
union as the exclusive collective bargaining representative of its workers. The plaintiff was successful both in the City Court of Lapulapu
where such complaint was first started as well as in the Court of First Instance of Cebu. It is from the decision of the latter court, rendered on
February 22, 1968, that this appeal was interposed by intervenor Associated Labor Union. It must have been an awareness on appellant's
part that on the substantive aspect, the claim of plaintiff to what was due its members under such collective bargaining agreement was
meritorious that led it to rely on alleged procedural obstacles for the reversal sought. Intervenor, however, has not thereby dented the
judgment. As will be more fully explained, there are no applicable procedural doctrines that stand in the way of plaintiff's suit. We affirm.

The facts are not in dispute. According to the decision: "From the evidence presented it appears that
the defendant Cebu Shipyard & Engineering Works, Inc. in Lapulapu City is employing laborers and
employees belonging to two rival labor unions. Seventy-two of these employees or laborers whose
names appear in the complaint are affiliated with the Mactan Workers Union while the rest are
members of the intervenor Associated Labor Union. On November 28, 1964, the defendant Cebu
Shipyard & Engineering Works, Inc. and the Associated Labor Union entered into a 'Collective
Bargaining Agreement' ... the pertinent part of which, Article XIII thereof, [reads thus]: '... The
[Company] agrees to give a profit-sharing bonus to its employees and laborers to be taken from ten
per cent (10%) of its net profits or net income derived from the direct operation of its shipyard and
shop in Lapulapu City and after deducting the income tax and the bonus annually given to its
General Manager and the Superintendent and the members of the Board of Directors and Secretary
of the Corporation, to be payable in two (2) installments, the first installment being payable in March
and the second installment in June, each year out of the profits in agreement. In the computation of
said ten per cent (10%) to [be] distributed as a bonus among the employees and laborers of the
[Company] in proportion to their salaries or wages, only the income derived by the [Company] from
the direct operation of its shipyard and shop in Lapulapu City, as stated herein-above-commencing
from the earnings during the year 1964, shall be included. Said profit-sharing bonus shall be paid by
the [Company] to [Associated Labor Union] to be delivered by the latter to the employees and
laborers concerned and it shall be the duty of the Associated Labor Union to furnish and deliver to
the [Company] the corresponding receipts duly signed by the laborers and employees entitled to
receive the profit-sharing bonus within a period of sixty (60) days from the date of receipt by [it] from
the [Company] of the profit-sharing bonus. If a laborer or employee of the [Company] does not want
to accept the profit-sharing bonus which the said employee or laborer is entitled under this
Agreement, it shall be the duty of the [Associated Labor Union] to return the money received by [it]
as profit-sharing bonus to the [Company] within a period of sixty (60) days from the receipt by the
[Union] from the [Company] of the said profit-sharing bonus.'"3 The decision went on to state: "In
compliance with the said collective bargaining agreement, in March, 1965 the defendant Cebu
Shipyard & Engineering Works, Inc. delivered to the ALU for distribution to the laborers or
employees working with the defendant corporation to the profit-sharing bonus corresponding to the
first installment for the year 1965. Again in June 1965 the defendant corporation delivered to the
Associated Labor Union the profit-sharing bonus corresponding to the second installment for 1965.
The members of the Mactan Workers Union failed to receive their shares in the second installment
of bonus because they did not like to go to the office of the ALU to collect their shares. In
accordance with the terms of the collective bargaining after 60 days, the uncollected shares of the
plaintiff union members was returned by the ALU to the defendant corporation. At the same time the
defendant corporation was advised by the ALU not to deliver the said amount to the members of the
Mactan Workers Union unless ordered by the Court, otherwise the ALU will take such step to protect
the interest of its members ... . Because this warning given by the intervenor union the defendant
corporation did not pay to the plaintiffs the sum of P4,035.82 which was returned by the Associated
Labor Union, but instead, deposited the said amount with the Labor Administrator. For the recovery
of this amount this case was filed with the lower court." 4

The dispositive portion of such decision follows: "[Wherefore], judgment is hereby rendered ordering
the defendants to deliver to the Associated Labor Union the sum of P4,035.82 for distribution to the
employees of the defendant corporation who are members of the Mactan Workers Union; and
ordering the intervenor Associated Labor Union, immediately after receipt of the said amount, to pay
the members of the Mactan Workers Union their corresponding shares in the profit-sharing bonus for
the second installments for the year 1965."5

It is from such a decision that an appeal was taken by intervenor Associated Labor Union. As is quite
apparent on the face of such judgment, the lower court did nothing except to require literal
compliance with the terms of a collective bargaining contract. Nor, as will be hereafter discussed,
has any weakness thereof been demonstrated on the procedural questions raised by appellant. To
repeat, we have to affirm.

1. The terms and conditions of a collective bargaining contract constitute the law between the
parties. Those who are entitled to its benefits can invoke its provisions. In the event that an
obligation therein imposed is not fulfilled, the aggrieved party has the right to go to court for
redress.6 Nor does it suffice as a defense that the claim is made on behalf of non-members of
intervenor Associated Labor Union, for it is a well-settled doctrine that the benefits of a collective
bargaining agreement extend to the laborers and employees in the collective bargaining unit,
including those who do not belong to the chosen bargaining labor organization.7 Any other view
would be a discrimination on which the law frowns. It is appropriate that such should be the case. As
was held in United Restauror's Employees and Labor Union v. Torres,8 this Court speaking through
Justice Sanchez, "the right to be the exclusive representative of all the employees in an appropriate
collective bargaining unit is vested in the labor union 'designated or selected' for such purpose 'by
the majority of the employees' in the unit concerned." 9 If it were otherwise, the highly salutory
purpose and objective of the collective bargaining scheme to enable labor to secure better terms in
employment condition as well as rates of pay would be frustrated insofar as non-members are
concerned, deprived as they are of participation in whatever advantages could thereby be gained.
The labor union that gets the majority vote as the exclusive bargaining representative does not act
for its members alone. It represents all the employees in such a bargaining unit. It is not to be
indulged in any attempt on its part to disregard the rights of non-members. Yet that is what
intervenor labor union was guilty of, resulting in the complaint filed on behalf of the laborers, who
were in the ranks of plaintiff Mactan Labor Union.
The outcome was not at all unexpected. The right being clear all that had to be done was to see to
its enforcement. Nor did the lower court in the decision now on appeal, require anything else other
than that set forth in the collective bargaining agreement. All that was done was to have the
covenants therein contained as to the profit-sharing scheme carried out and respected. It would be
next to impossible for intervenor Associated Labor Union to point to any feature thereof that could
not in any wise be objected to as repugnant to the provisions of the collective bargaining contract.
Certainly the lower court, as did the City Court of Lapu-lapu, restricted itself to compelling the parties
to abide by what was agreed upon. How then can the appealed decision be impugned?

2. Intervenor Associated Labor Union, laboring under such a predicament had perforce to rely on
what it considered procedural lapses. It would assail the alleged lack of a cause of action, of
jurisdiction of the City Court of Lapulapu and of personality of the Mactan Workers Union to
represent its members. There is no merit to such an approach. The highly sophisticated line of
argument followed in its brief as appellant does not carry a persuasive ring. What is apparent is that
intervenor was hard put to prop up what was inherently a weak, not to say an indefensible, stand.
The impression given is that of a litigant clutching at straws.

How can the allegation of a lack of a cause of action be taken seriously when precisely there was a
right violated on the part of the members of plaintiff Mactan Workers Union, a grievance that called
for redress? The assignment of error that the City Court of Lapulapu was bereft of jurisdiction is
singularly unpersuasive. The amount claimed by plaintiff Mactan Workers Union on behalf of its
members was P4,035.82 and if the damages and attorney's fees be added, the total sum was less
than P10,000.00. Section 88 of the Judiciary Act in providing for the original jurisdiction of city courts
in civil cases provides: "In all civil actions, including those mentioned in Rules fifty-nine and sixty-two
(now Rules 57 and 60) of the Rules of Court, arising in his municipality or city, and not exclusively
cognizable by the Court of First Instance, the municipal judge and the judge of a city court shall have
exclusive original jurisdiction where the value of the subject matter or amount of the demand does
not exceed ten thousand pesos, exclusive of interests and costs." 10 It is true that if an element of
unfair labor practice may be discerned in a suit for the enforcement of a collective bargaining
contract, then the matter is solely cognizable by the Court of Industrial Relations. 11 It is equally true
that as of the date the lower court decision was rendered, the question of such enforcement had
been held to be for the regular courts to pass upon. 12 Counsel for intervenor Associated Labor Union
was precisely the petitioner in one of the decisions of this Court, Seno v . Mendoza, 13 where such a
doctrine was reiterated. In the language of Justice Makalintal, the ponente: "As the issue involved in
the instant case, although arising from a labor dispute, does not refer to one affecting an industry
which is indispensable to the national interest and certified by the President to the Industrial Court,
nor to minimum wage under the Minimum Wage Law, nor to hours of employment under the Eight-
Hour Labor Law, nor to an unfair labor practice, but seeks the enforcement of a provision of the
collective bargaining agreement, ..., jurisdiction pertains to the ordinary courts and not to the
Industrial Court." 14 There was only a half-hearted attempt, if it could be called that, to lend credence
to the third error assigned, namely that plaintiff Mactan Workers Union could not file the suit on
behalf of its members. That is evident by intervenor Associated Labor Union devoting only half a
page in its brief to such an assertion. It is easy to see why it should be thus. On its face, it certainly
appeared to be oblivious of how far a labor union can go, or is expected to, in the defense of the
rights of its rank and file. There was an element of surprise, considering that such a contention came
from a labor organization, which under normal condition should be the last to lay itself open to a
charge that it is not averse to denigrating the effectiveness of labor unions.

3. This brings us to one last point. It is quite understandable that labor unions in their campaign for
membership, for acquiring ascendancy in any shop, plant, or industry would do what lies in their
power to put down competing groups. The struggle is likely to be marked with bitterness, no quarter
being given or expected on the part of either side. Nevertheless, it is not to be forgotten that what is
entitled to constitutional protection is labor, or more specifically the working men and women, not
labor organizations. The latter are merely the instrumentalities through which their welfare may be
promoted and fostered. That is the raison d'etre of labor unions. The utmost care should be taken
then, lest in displaying an unyielding, intransigent attitude on behalf of their members, injustice be
committed against opposing labor organizations. In the final analysis, they alone are not the sole
victims, but the labor movement itself, which may well be the recipient of a crippling blow. Moreover,
while it is equally understandable that their counsel would take advantage of every legal doctrine
deemed applicable or conjure up any defense that could serve their cause, still, as officers of the
court, there should be an awareness that resort to such a technique does result in clogged dockets,
without the least justification especially so if there be insistence on flimsy and insubstantial
contentions just to give some semblance of plausibility to their pleadings. Certainly, technical
virtuosity, or what passes for it, is no substitute for an earnest and sincere desire to assure that there
be justice according to law. That is a creed to which all members of the legal profession, labor
lawyers not excluded, should do their best to live by.

WHEREFORE, the decision of the lower court of February 22, 1968 is affirmed. Costs against
Associated Labor Union.

Concepcion, C.J., Reyes, J.B.L., Makalintal, Zaldivar, Castro, Teehankee, Barredo, Makasiar and
Antonio, JJ., concur.
G.R. No. 96189 July 14, 1992

UNIVERSITY OF THE PHILIPPINES, petitioner,

vs.
HON. PURA FERRER-CALLEJA, Director of the Bureau of Labor Relations, Department of
Labor and Employment, and THE ALL U.P. WORKERS' UNION, represented by its President,
Rosario del Rosario, respondent.

NARVASA, C.J.:

In this special civil action of certiorari the University of the Philippines seeks the nullification of the
Order dated October 30, 1990 of Director Pura Ferrer-Calleja of the Bureau of Labor Relations
holding that "professors, associate professors and assistant professors (of the University of the
Philippines) are . . rank-and-file employees . . ;" consequently, they should, together with the so-
called non-academic, non-teaching, and all other employees of the University, be represented by
only one labor organization. 1 The University is joined in this undertaking by the Solicitor General
who "has taken a position not contrary to that of petitioner and, in fact, has manifested . . that he is
not opposing the petition . . ." 2

The case 3 was initiated in the Bureau of Labor Relations by a petition filed on March 2, 1990 by a
registered labor union, the "Organization of Non-Academic Personnel of UP" (ONAPUP). 4 Claiming
to have a membership of 3,236 members — comprising more than 33% of the 9,617 persons
constituting the non-academic personnel of UP-Diliman, Los Baños, Manila, and Visayas, it sought
the holding of a certification election among all said non-academic employees of the University of the
Philippines. At a conference thereafter held on March 22, 1990 in the Bureau, the University stated
that it had no objection to the election.

On April 18, 1990, another registered labor union, the "All UP Workers' Union," 5 filed a comment, as
intervenor in the certification election proceeding. Alleging that its membership covers both
academic and non-academic personnel, and that it aims to unite all UP rank-and-file employees in
one union, it declared its assent to the holding of the election provided the appropriate organizational
unit was first clearly defined. It observed in this connection that the Research, Extension and
Professional Staff (REPS), who are academic non-teaching personnel, should not be deemed part of
the organizational unit.

For its part, the University, through its General Counsel, 6 made of record its view that there should
be two (2) unions: one for academic, the other for non-academic or administrative, personnel
considering the dichotomy of interests, conditions and rules governing these employee groups.

Director Calleja ruled on the matter on August 7, 1990. 7 She declared that "the appropriate
organizational unit . . should embrace all the regular rank-and-file employees, teaching and non-
teaching, of the University of the Philippines, including all its branches" and that there was no
sufficient evidence "to justify the grouping of the non-academic or administrative personnel into an
organization unit apart and distinct from that of the academic or teaching personnel." Director Calleja
adverted to Section 9 of Executive Order No. 180, viz.:

Sec. 9. The appropriate organizational unit shall be the employer unit consisting of
rank-and-file employees, unless circumstances otherwise require.
 and Section 1, Rule IV of the Rules Implementing said EO 180 (as amended by SEC. 2,
Resolution of Public Sector Labor Management Council dated May 14, 1989, viz.:

xxx xxx xxx

For purposes of registration, an appropriate organizational unit may refer to:

xxx xxx xxx

d. State universities or colleges, government-owned or controlled corporations with

original charters.

She went on to say that the general intent of EO 180 was "not to fragmentize the employer
unit, as "can be gleaned from the definition of the term "accredited employees' organization,"
which refers to:

. . a registered organization of the rank-and-file employees as defined in these rules

recognized to negotiate for the employees in an organizational unit headed by an
officer with sufficient authority to bind the agency, such as . . . . . . state colleges and
universities.

The Director thus commanded that a certification election be "conducted among rank-and-file
employees, teaching and non-teaching" in all four autonomous campuses of the UP, and that
management appear and bring copies of the corresponding payrolls for January, June, and July,
1990 at the "usual pre-election conference . . ."

At the pre-election conference held on March 22, 1990 at the Labor Organizational Division of the
DOLE, 8 the University sought further clarification of the coverage of the term, "rank-and-file" personnel, asserting that not every
employee could properly be embraced within both teaching and non-teaching categories since there are those whose positions are in truth
managerial and policy-determining, and hence, excluded by law.

At a subsequent hearing (on October 4, 1990), the University filed a Manifestation seeking the
exclusion from the organizational unit of those employees holding supervisory positions among non-
academic personnel, and those in teaching staff with the rank of Assistant Professor or higher,
submitting the following as grounds therefor:

1) Certain "high-level employees" with policy-making, managerial, or confidential functions, are

ineligible to join rank-and-file employee organizations under Section 3, EO 180:

Sec. 3. High-level employees whose functions are normally considered as policy-

making or managerial or whose duties are of a highly confidential nature shall not be
eligible to join the organization of rank-and file government employees;

2) In the University hierarchy, not all teaching and non-teaching personnel belong the rank-and file:
just as there are those occupying managerial positions within the non-teaching roster, there is also a
dichotomy between various levels of the teaching or academic staff;

3) Among the non-teaching employees composed of Administrative Staff and Research personnel,
only those holding positions below Grade 18 should be regarded as rank-and-file, considering that
those holding higher grade positions, like Chiefs of Sections, perform supervisory functions including
that of effectively recommending termination of appointments or initiating appointments and
promotions; and
4) Not all teaching personnel may be deemed included in the term, "rank-and-file;" only those
holding appointments at the instructor level may be so considered, because those holding
appointments from Assistant Professor to Associate Professor to full Professor take part, as
members of the University Council, a policy-making body, in the initiation of policies and rules with
respect to faculty tenure and promotion. 9

The ONAPUP quite categorically made of record its position; that it was not opposing the
University's proferred classification of rank-and file employees. On the other hand, the "All UP
Workers' Union" opposed the University's view, in a Position Paper presented by it under date of
October 18, 1990.

Director Calleja subsequently promulgated an Order dated October 30, 1990, resolving the "sole
issue" of "whether or not professors, associate professors and assistant professors are included in
the definition of high-level employee(s)" in light of Rule I, Section (1) of the Implementing Guidelines
of Executive Order No. 180, defining "high level employee" as follows:

1. High Level Employee — is one whose functions are normally considered policy
determining, managerial or one whose duties are highly confidential in nature. A
managerial function refers to the exercise of powers such as:

1. To effectively recommend such managerial actions;

2. To formulate or execute management policies and decisions; or

3. To hire, transfer, suspend, lay-off, recall, dismiss, assign or

discipline employees.

The Director adjudged that said teachers are rank-and-file employees "qualified to join unions and
vote in certification elections." According to her —

A careful perusal of the University Code . . shows that the policy-making powers of
the Council are limited to academic matters, namely, prescribing courses of study
and rules of discipline, fixing student admission and graduation requirements,
recommending to the Board of Regents the conferment of degrees, and disciplinary
power over students. The policy-determining functions contemplated in the definition
of a high-level employee pertain to managerial, executive, or organization policies,
such as hiring, firing, and disciplining of employees, salaries, teaching/working hours,
other monetary and non-monetary benefits, and other terms and conditions of
employment. They are the usual issues in collective bargaining negotiations so that
whoever wields these powers would be placed in a situation of conflicting interests if
he were allowed to join the union of rank-and-file employees.

The University seasonably moved for reconsideration, seeking to make the following points, to wit:

1) UP professors do "wield the most potent managerial powers: the power to rule on tenure, on the
creation of new programs and new jobs, and conversely, the abolition of old programs and the
attendant re-assignment of employees.

2) To say that the Council is "limited to (acting on) academic matters" is error, since academic
decisions "are the most important decisions made in a University . . (being, as it were) the heart, the
core of the University as a workplace.
3) Considering that the law regards as a "high level" employee, one who performs either policy-
determining, managerial, or confidential functions, the Director erred in applying only the "managerial
functions" test, ignoring the "policy-determining functions" test.

4) The Director's interpretation of the law would lead to absurd results, e.g.: "an administrative officer
of the College of Law is a high level employee, while a full Professor who has published several
treatises and who has distinguished himself in argument before the Supreme Court is a mere rank-
and-file employee. A dormitory manager is classified as a high level employee, while a full Professor
or Political Science with a Ph. D. and several Honorary doctorates is classified as rank-and-file." 10

The motion for reconsideration was denied by Director Calleja, by Order dated November 20, 1990.

The University would now have this Court declare void the Director's Order of October 30, 1990 as
well as that of November 20, 1990. 11 A temporary restraining order was issued by the Court, by
Resolution dated December 5, 1990 conformably to the University's application therefor.

Two issues arise from these undisputed facts. One is whether or not professors, associate
professors and assistant professors are "high-level employees" "whose functions are normally
considered policy determining, managerial or . . highly confidential in nature." The other is whether
or not, they, and other employees performing academic functions, 12 should comprise a collective
bargaining unit distinct and different from that consisting of the non-academic employees of the
University, 13 considering the dichotomy of interests, conditions and rules existing between them.

As regards the first issue, the Court is satisfied that it has been correctly resolved by the respondent
Director of Bureau Relations. In light of Executive Order No. 180 and its implementing rules, as well
as the University's charter and relevant regulations, the professors, associate professors and
assistant professors (hereafter simply referred to as professors) cannot be considered as exercising
such managerial or highly confidential functions as would justify their being categorized as "high-
level employees" of the institution.

The Academic Personnel Committees, through which the professors supposedly exercise
managerial functions, were constituted "in order to foster greater involvement of the faculty and other
academic personnel in appointments, promotions, and other personnel matters that directly affect
them." 14 Academic Personnel Committees at the departmental and college levels were organized
"consistent with, and demonstrative of the very idea of consulting the faculty and other academic
personnel on matters directly affecting them" and to allow "flexibility in the determination of
guidelines peculiar to a particular department or college." 15

Personnel actions affecting the faculty and other academic personnel should, however, "be
considered under uniform guidelines and consistent with the Resolution of the Board (of Regents)
adopted during its 789th Meeting (11-26-69) creating the University Academic Personnel
Board." 16 Thus, the Departmental Academic Personnel Committee is given the function of
"assist(ing) in the review of the recommendations initiated by the Department Chairman with regard
to recruitment, selection, performance evaluation, tenure and staff development, in accordance with
the general guidelines formulated by the University Academic Personnel Board and the
implementing details laid down by the College Academic Personnel Committee;" 17 while the College
Academic Personnel Committee is entrusted with the following functions: 18

1. Assist the Dean in setting up the details for the implementation of policies, rules,
standards or general guidelines as formulated by the University Academic Personnel
Board;
 2. Review the recommendation submitted by the DAPCs with regard to recruitment,
selection, performance evaluation, tenure, staff development, and promotion of the
faculty and other academic personnel of the College;

3. Establish departmental priorities in the allocation of available funds for promotion;

4. Act on cases of disagreement between the Chairman and the members of the
DAPC particularly on personnel matters covered by this Order;

5. Act on complaints and/or protests against personnel actions made by the

Department Chairman and/or the DAPC.

The University Academic Personnel Board, on the other hand, performs the following functions: 19

1. Assist the Chancellor in the review of the recommendations of the CAPC'S.

2. Act on cases of disagreement between the Dean and the CAPC.

3. Formulate policies, rules, and standards with respect to the selection,

compensation, and promotion of members of the academic staff.

4. Assist the Chancellor in the review of recommendations on academic promotions

and on other matters affecting faculty status and welfare.

From the foregoing, it is evident that it is the University Academic Personnel Committee, composed
of deans, the assistant for academic affairs and the chief of personnel, which formulates the policies,
rules and standards respecting selection, compensation and promotion of members of the academic
staff. The departmental and college academic personnel committees' functions are purely
recommendatory in nature, subject to review and evaluation by the University Academic Personnel
Board. In Franklin Baker Company of the Philippines vs. Trajano, 20 this Court reiterated the principle
laid down in National Merchandising Corp. vs. Court of Industrial Relations, 21 that the power to
recommend, in order to qualify an employee as a supervisor or managerial employee "must not only
be effective but the exercise of such authority should not be merely of a routinary or clerical nature
but should require the use of independent judgment." Where such recommendatory powers, as in
the case at bar, are subject to evaluation, review and final action by the department heads and other
higher executives of the company, the same, although present, are not effective and not an exercise
of independent judgment as required by law.

Significantly, the personnel actions that may be recommended by the departmental and college
academic personnel committees must conform with the general guidelines drawn up by the
university personnel academic committee. This being the case, the members of the departmental
and college academic personnel committees are not unlike the chiefs of divisions and sections of the
National Waterworks and Sewerage Authority whom this Court considered as rank-and-file
employees in National Waterworks & Sewerage Authority vs. NWSA Consolidated Unions, 22because
"given ready policies to execute and standard practices to observe for their execution, . . . they have
little freedom of action, as their main function is merely to carry out the company's orders, plans and
policies."

The power or prerogative pertaining to a high-level employee "to effectively recommend such
managerial actions, to formulate or execute management policies or decisions and/or to hire,
transfer, suspend, lay-off, recall, dismiss, assign or discipline employees" 23 is exercised to a certain
degree by the university academic personnel board/committees and ultimately by the Board of
Regents in accordance with Section 6 of the University
Charter, 24 thus:

(e) To appoint, on the recommendation of the President of the University, professors,

instructors, lecturers and other employees of the University; to fix their
compensation, hours of service, and such other duties and conditions as it may
deem proper; to grant them in its discretion leave of absence under such regulations
as it may promulgate, any other provision of law to the contrary notwithstanding, and
to remove them for cause after investigation and hearing shall have been had.

Another factor that militates against petitioner's espousal of managerial employment status for all its
professors through membership in the departmental and college academic personnel committees is
that not all professors are members thereof. Membership and the number of members in the
committees are provided as follows: 25

Sec. 2. Membership in Committees. — Membership in committees may be made

either through appointment, election, or by some other means as may be determined
by the faculty and other academic personnel of a particular department or college.

Sec. 3. Number of Members. — In addition to the Chairman, in the case of a

department, and the Dean in the case of a college, there shall be such number of
members representing the faculty and academic personnel as will afford a fairly
representative, deliberative and manageable group that can handle evaluation of
personnel actions.

Neither can membership in the University Council elevate the professors to the status of high-level
employees. Section 6 (f) and 9 of the UP Charter respectively provide: 26

Sec. 6. The Board of Regents shall have the following powers and duties . . . ;

xxx xxx xxx

(f) To approve the courses of study and rules of discipline drawn up by the University
Council as hereinafter provided; . . .

Sec. 9. There shall be a University Council consisting of the President of the

University and of all instructors in the university holding the rank of professor,
associate professor, or assistant professor. The Council shall have the power to
prescribe the courses of study and rules of discipline, subject to the approval of the
Board of Regents. It shall fix the requirements for admission to any college of the
university, as well as for graduation and the receiving of a degree. The Council alone
shall have the power to recommend students or others to be recipients of degrees.
Through its president or committees, it shall have disciplinary power over the
students within the limits prescribed by the rules of discipline approved by the Board
of Regents. The powers and duties of the President of the University, in addition to
those specifically provided in this Act shall be those usually pertaining to the office of
president of a university.

It is readily apparent that the policy-determining functions of the University Council are subject to
review, evaluation and final approval by the Board of Regents. The Council's power of discipline is
likewise circumscribed by the limits imposed by the Board of Regents. What has been said about the
recommendatory powers of the departmental and college academic personnel committees applies
with equal force to the alleged policy-determining functions of the University Council.

Even assuming arguendo that UP professors discharge policy-determining functions through the
University Council, still such exercise would not qualify them as high-level employees within the
context of E.O. 180. As correctly observed by private respondent, "Executive Order No. 180 is a law
concerning public sector unionism. It must therefore be construed within that context. Within that
context, the University of the Philippines represents the government as an employer. 'Policy-
determining' refers to policy-determination in university mattes that affect those same matters that
may be the subject of negotiation between public sector management and labor. The reason why
'policy-determining' has been laid down as a test in segregating rank-and-file from management is to
ensure that those who lay down policies in areas that are still negotiable in public sector collective
bargaining do not themselves become part of those employees who seek to change these policies
for their collective welfare." 27

The policy-determining functions of the University Council refer to academic matters, i.e. those
governing the relationship between the University and its students, and not the University as an
employer and the professors as employees. It is thus evident that no conflict of interest results in the
professors being members of the University Council and being classified as rank-and-file employees.

Be that as it may, does it follow, as public respondent would propose, that all rank-and-file
employees of the university are to be organized into a single collective bargaining unit?

A "bargaining unit" has been defined as a group of employees of a given employer, comprised of all
or less than all of the entire body of employees, which the collective interest of all the employees,
consistent with equity to the employer, indicate to be the best suited to serve the reciprocal rights
and duties of the parties under the collective bargaining provisions of the law. 28

Our labor laws do not however provide the criteria for determining the proper collective bargaining
unit. Section 12 of the old law, Republic Act No. 875 otherwise known as the Industrial Peace Act,
simply reads as follows: 29

Sec. 12. Exclusive Collective Bargaining Representation for Labor Organizations. —

The labor organization designated or selected for the purpose of collective
bargaining by the majority of the employees in an appropriate collective bargaining
unit shall be the exclusive representative of all the employees in such unit for the
purpose of collective bargaining in respect to rates of pay, wages, hours of
employment, or other conditions of employment; Provided, That any individual
employee or group of employees shall have the right at any time to present
grievances to their employer.

Although said Section 12 of the Industrial Peace Act was subsequently incorporated into the Labor
Code with minor changes, no guidelines were included in said Code for determination of an
appropriate bargaining unit in a given case. 30 Thus, apart from the single descriptive word
"appropriate," no specific guide for determining the proper collective bargaining unit can be found in
the statutes.

Even Executive Order No. 180 already adverted to is not much help. All it says, in its Section 9, is
that "(t)he appropriate organizational unit shall be the employer unit consisting of rank-and-file
employees, unless circumstances otherwise require." Case law fortunately furnishes some
guidelines.
When first confronted with the task of determining the proper collective bargaining unit in a particular
controversy, the Court had perforce to rely on American jurisprudence. In Democratic Labor
Association vs. Cebu Stevedoring Company, Inc., decided on February 28, 1958, 31 the Court
observed that "the issue of how to determine the proper collective bargaining unit and what unit
would be appropriate to be the collective bargaining
agency" . . . "is novel in this jurisdiction; however, American precedents on the matter abound . . (to
which resort may be had) considering that our present Magna Carta has been patterned after the
American law on the subject." Said the Court:

. . . Under these precedents, there are various factors which must be satisfied and
considered in determining the proper constituency of a bargaining unit. No one
particular factor is itself decisive of the determination. The weight accorded to any
particular factor varies in accordance with the particular question or questions that
may arise in a given case. What are these factors? Rothenberg mentions a good
number, but the most pertinent to our case are: (1) will of the employees (Globe
Doctrine); (2) affinity and unit of employees' interest, such as substantial similarity of
work and duties, or similarity of compensation and working conditions; (3) prior
collective bargaining history; and (4) employment status, such as temporary,
seasonal probationary employees. . . .

xxx xxx xxx

An enlightening appraisal of the problem of defining an appropriate bargaining unit is

given in the 10th Annual Report of the National Labor Relations Board wherein it is
emphasized that the factors which said board may consider and weigh in fixing
appropriate units are: the history, extent and type of organization of employees; the
history of their collective bargaining; the history, extent and type of organization of
employees in other plants of the same employer, or other employers in the same
industry; the skill, wages, work, and working conditions of the employees; the desires
of the employees; the eligibility of the employees for membership in the union or
unions involved; and the relationship between the unit or units proposed and the
employer's organization, management, and operation. . . .

. . In said report, it is likewise emphasized that the basic test in determining the
appropriate bargaining unit is that a unit, to be appropriate, must affect a grouping of
employees who have substantial, mutual interests in wages, hours, working
conditions and other subjects of collective bargaining (citing Smith on Labor Laws,
316-317; Francisco, Labor Laws, 162). . . .

The Court further explained that "(t)he test of the grouping is community or mutuality of interests.
And this is so because 'the basic test of an asserted bargaining unit's acceptability is whether or not
it is fundamentally the combination which will best assure to all employees the exercise of their
collective bargaining rights' (Rothenberg on Labor Relations, 490)." Hence, in that case, the Court
upheld the trial court's conclusion that two separate bargaining units should be formed, one
consisting of regular and permanent employees and another consisting of casual laborers or
stevedores.

Since then, the "community or mutuality of interests" test has provided the standard in determining
the proper constituency of a collective bargaining unit. In Alhambra Cigar & Cigarette Manufacturing
Company, et al. vs. Alhambra Employees' Association (PAFLU), 107 Phil. 23, the Court, noting that
the employees in the administrative, sales and dispensary departments of a cigar and cigarette
manufacturing firm perform work which have nothing to do with production and maintenance, unlike
those in the raw lead (malalasi), cigar, cigarette, packing (precintera) and engineering and garage
departments, authorized the formation of the former set of employees into a separate collective
bargaining unit. The ruling in the Democratic Labor Association case, supra, was reiterated
in Philippine Land-Air-Sea Labor Unit vs. Court of Industrial Relations, 110 Phil. 176, where casual
employees were barred from joining the union of the permanent and regular employees.

Applying the same "community or mutuality of interests" test, but resulting in the formation of only
one collective bargaining units is the case of National Association of Free Trade Unions vs. Mainit
Lumber Development Company Workers Union-United Lumber and General Workers of the
Phils., G.R. No. 79526, December 21, 1990, 192 SCRA 598. In said case, the Court ordered the
formation of a single bargaining unit consisting of the Sawmill Division in Butuan City and the
Logging Division in Zapanta Valley, Kitcharao, Agusan Norte of the Mainit Lumber Development
Company. The Court reasoned:

Certainly, there is a mutuality of interest among the employees of the Sawmill

Division and the Logging Division. Their functions mesh with one another. One group
needs the other in the same way that the company needs them both. There may be
difference as to the nature of their individual assignments but the distinctions are not
enough to warrant the formation of a separate bargaining unit.

In the case at bar, the University employees may, as already suggested, quite easily be categorized
into two general classes: one, the group composed of employees whose functions are non-
academic, i.e., janitors, messengers, typists, clerks, receptionists, carpenters, electricians, grounds-
keepers, chauffeurs, mechanics, plumbers; 32 and two, the group made up of those performing
academic functions, i.e., full professors, associate professors, assistant professors, instructors —
who may be judges or government executives — and research, extension and professorial
staff. 33 Not much reflection is needed to perceive that the community or mutuality of interests which
justifies the formation of a single collective bargaining unit is wanting between the academic and
non-academic personnel of the university. It would seem obvious that teachers would find very little
in common with the University clerks and other non-academic employees as regards responsibilities
and functions, working conditions, compensation rates, social life and interests, skills and intellectual
pursuits, cultural activities, etc. On the contrary, the dichotomy of interests, the dissimilarity in the
nature of the work and duties as well as in the compensation and working conditions of the
academic and non-academic personnel dictate the separation of these two categories of employees
for purposes of collective bargaining. The formation of two separate bargaining units, the first
consisting of the rank-and-file non-academic personnel, and the second, of the rank-and-file
academic employees, is the set-up that will best assure to all the employees the exercise of their
collective bargaining rights. These special circumstances, i.e., the dichotomy of interests and
concerns as well as the dissimilarity in the nature and conditions of work, wages and compensation
between the academic and non-academic personnel, bring the case at bar within the exception
contemplated in Section 9 of Executive Order No. 180. It was grave abuse of discretion on the part
of the Labor Relations Director to have ruled otherwise, ignoring plain and patent realities.

WHEREFORE, the assailed Order of October 30, 1990 is hereby AFFIRMED in so far as it declares
the professors, associate professors and assistant professors of the University of the Philippines as
rank-and-file employees. The Order of August 7, 1990 is MODIFIED in the sense that the non-
academic rank-and-file employees of the University of the Philippines shall constitute a bargaining
unit to the exclusion of the academic employees of the institution — i.e., full professors, associate
professors, assistant professors, instructors, and the research, extension and professorial staff, who
may, if so minded, organize themselves into a separate collective bargaining unit; and that,
therefore, only said non-academic rank-and-file personnel of the University of the Philippines in
Diliman, Manila, Los Baños and the Visayas are to participate in the certification election.
G.R. No. L-28223 August 30, 1968

MECHANICAL DEPARTMENT LABOR UNION SA PHILIPPINE NATIONAL

RAILWAYS, petitioner,
vs.
COURT OF INDUSTRIAL RELATIONS and SAMAHAN NG MGA MANGGAGAWA SA
CALOOCAN SHOPS,respondents.

Sisenando Villaluz for petitioner.

Gregorio E. Fajardo for respondent Samahan ng mga Manggagawa sa Caloocan Shops.

REYES, J.B.L., J.:

Petition by the "Mechanical Department Labor Union sa PNR" for a review of an order of the Court of
Industrial Relations, in its Case No. 1475-MC, directing the holding of a plebiscite election to
determine whether the employees at the Caloocan Shops desire the respondent union, "Samahan
ng mga Manggagawa sa Caloocan Shops", to be separated from the Mechanical Department Labor
Union, with a view to the former being recognized as a separate bargaining unit.

The case began on 13 February 1965 by a petition of the respondent "Samahan ng mga
Manggagawa, etc." calling attention to the fact that there were three unions in the Caloocan shops of
the Philippine National Railways: the "Samahan", the "Kapisanan ng Manggagawa sa Manila
Railroad Company", and the Mechanical Department Labor Union; that no certification election had
been held in the last 12 months in the Caloocan shops; that both the "Samahan" and the Mechanical
Department Labor Union had submitted different labor demands upon the management for which
reason a certification election was needed to determine the proper collective bargaining agency for
the Caloocan shop workers.

The petition was opposed by the management as well as by the Mechanical Department Labor
Union, the latter averring that it had been previously certified in two cases as sole and exclusive
bargaining agent of the employees and laborers of the PNR'S mechanical department, and had
negotiated two bargaining agreements with management in 1961 and 1963; that before the
expiration of the latter, a renewal thereof had been negotiated and the contract remained to be
signed; that the "Samahan" had been organized only in 21 January 1965; that the Caloocan shops
unit was not established nor separated from the Mechanical Department unit; that the "Samahan" is
composed mainly of supervisors who had filed a pending case to be declared non-supervisors; and
that the purpose of the petition was to disturb the present smooth working labor management
relations.

By an order of 18 August 1967, Judge Arsenio Martinez, after receiving the evidence, made the
following findings:.
1äwphï1.ñët

The Court, after a cursory examination of the evidence presented made the following
findings: That petitioner union is composed of workers exclusively at the Caloocan shops of
the Philippine National Railways charged with the maintenance of rolling stocks for repairs;
major repairs of locomotive, engines, etc. are done in the Caloocan shops while minor ones
in the Manila sheds; workers in the Caloocan shops do not leave their station unlike Manila
shop workers who go out along the routes and lines for repairs; workers both in the Caloocan
shops and Manila sheds are exposed to hazards occasioned by the nature of their work; that
with respect to wages and salaries of employees, categories under the Job Classification
and Evaluation Plan of the company apply to all workers both in the Caloocan Shops and
Manila sheds; administration over employees, members of petitioner union as well as
 oppositor is under the Administrative Division of the company; that from the very nature of
their work, members of petitioner union and other workers of the Mechanical Department
have been under the coverage of the current collective bargaining agreement which was a
result of a certification by this Court of the Mechanical Department Labor union, first in 1960
and later in 1963. Subsequently, when the latter contract expired, negotiations for its renewal
were had and at the time of the filing of this petition was already consummated, the only act
remaining to be done was to affix the signatures of the parties thereto; that during the
pendency of this petition, on June 14, 1965, the aforesaid collective bargaining agreement
was signed between the Philippine National Railways and the Mechanical Department Labor
Union sa Philippine National Railways (Manila Railroad Company).

The main issue involved herein is: Whether or not a new unit should be established, the
Caloocan shops, separate and distinct from the rest of the workers under the Mechanical
Department now represented by the Mechanical Department Labor Union.

The Caloocan Shops, all located at Caloocan City have 360 workers more or less. It is part
and parcel of the whole Mechanical Department of the Philippine National Railways. The
department is composed of four main divisions or units, namely: Operations, Manila Area
and Lines; Locomotive Crew; Motor Car Crew; and the Shops Rolling Stocks Maintenance.
(Exhibits "D" and "D-1").

The Locomotive crew and Motor Car Crew, though part of the Mechanical Department, is a
separate unit, and is represented by the Union de Maquinistas, Fogoneros Y Motormen. The
workers under the other two main units of the departments are represented by the
Mechanical Department Labor Union. The workers of the Shops Rolling Stocks Maintenance
Division or the Caloocan Shops now seek to be separated from the rest of the workers of the
department and to be represented by the "Samahan Ng Mga Manggagawa sa Caloocan
Shops." .

There is certainly a community of interest among the workers of the Caloocan Shops. They
are grouped in one place. They work under one or same working condition, same working
time or schedule and are exposed to same occupational risk.

Though evidence on record shows that workers at the Caloocan Shops perform the same
nature of work as their counterparts in the Manila Shed, the difference lies in the fact that
workers at the Caloocan Shops perform major repairs of locomotives, rolling stocks, engines,
etc., while those in the Manila Shed, works on minor repairs. Heavy equipment and
machineries are found in the Caloocan Shops.

The trial judge then reviewed the collective bargaining history of the Philippine National Railways, as
follows:1äwphï1.ñët

On several similar instances, this Court allowed the establishment of new and separate
bargaining unit in one company, even in one department of the same company, despite the
existence of the same facts and circumstances as obtaining in the case at bar.

The history of the collective bargaining in the Manila Railroad Company, now the Philippine
National Railways shows that originally, there was only one bargaining unit in the company,
represented by the Kapisanan Ng Manggagawa sa MRR. Under Case No. 237-MC, this
Court ordered the establishment of two additional units, the engine crew and the train crew to
be represented by the Union de Maquinistas, Fogoneros, Ayudante Y Motormen and Union
de Empleados de Trenes, respectively. Then in 1961, under Cases Nos. 491-MC, 494-MC
 and 507-MC three new separate units were established, namely, the yard crew unit, station
employees unit and engineering department employees unit, respectively, after the
employees concerned voted in a plebiscite conducted by the court for the separation from
existing bargaining units in the company. Then again, under Case No. 763-MC, a new unit,
composed of the Mechanical Department employees, was established to be represented by
the Mechanical Department Labor Union. Incidentally, the first attempt of the employees of
the Mechanical Department to be separated as a unit was dismissed by this Court of Case
No. 488-MC.

In the case of the yard crew, station employees and the Engineering Department employees,
the Supreme Court sustained the order of this Court in giving the employees concerned the
right to vote and decide whether or not they desire to be separate units (See G.R. Nos. L-
16292-94, L-16309 and L-16317-18, November, 1965).

In view of its findings and the history of "union representation" in the railway company, indicating that
bargaining units had been formed through separation of new units from existing ones whenever
plebiscites had shown the workers' desire to have their own representatives, and relying on the
"Globe doctrine" (Globe Machine & Stamping Co., 3 NLRB 294) applied in Democratic Labor Union
vs. Cebu Stevedoring Co., L-10321, 28 February 1958, Judge Martinez held that the employees in
the Caloocan Shops should be given a chance to vote on whether their group should be separated
from that represented by the Mechanical Department Labor Union, and ordered a plebiscite held for
the purpose. The ruling was sustained by the Court en banc; wherefore, the Mechanical Department
Labor Union appealed to this Court questioning the applicability under the circumstances of the
"Globe doctrine" of considering the will of the employees in determining what union should represent
them.

Technically, this appeal is premature, since the result of the ordered plebiscite among the workers of
the Caloocan shops may be adverse to the formation of a separate unit, in which event, as stated in
the appealed order, all questions raised in this case would be rendered moot and academic.
Apparently, however, the appellant Mechanical Department Labor Union takes it for granted that the
plebiscite would favor separation.

We find no grave abuse of discretion in the issuance of the ruling under appeal as would justify our
interfering with it. Republic Act No. 875 has primarily entrusted the prosecution of its policies to the
Court of Industrial Relations, and, in view of its intimate knowledge concerning the facts and
circumstances surrounding the cases brought before it, this Court has repeatedly upheld the
exercise of discretion of the Court of Industrial Relations in matters concerning the representation of
employee groups (Manila Paper Mills Employees & Workers' Association vs. C.I.R. 104 Phil. 10;
Benguet Consolidated vs. Bobok Lumber Jack Association, 103 Phil. 1150).

Appellant contends that the application of the "Globe doctrine" is not warranted because the workers
of the Caloocan shops do not require different skills from the rest of the workers in the Mechanical
Department of the Railway Company. This question is primarily one of facts. The Industrial Court
has found that there is a basic difference, in that those in the Caloocan shops not only have a
community of interest and working conditions but perform major repairs of railway rolling stock, using
heavy equipment and machineries found in said shops, while the others only perform minor repairs.
It is easy to understand, therefore, that the workers in the Caloocan shops require special skill in the
use of heavy equipment and machinery sufficient to set them apart from the rest of the workers. In
addition, the record shows that the collective bargaining agreements negotiated by the appellant
union have been in existence for more than two (2) years; hence, such agreements can not
constitute a bar to the determination, by proper elections, of a new bargaining representative (PLDT
Employees' Union vs. Philippine Long Distance Telephone Co., 51 Off. Gaz., 4519).
As to the charge that some of the members of the appellee, "Samahan Ng Manggagawa", are
actually supervisors, it appears that the question of the status of such members is still pending final
decision; hence, it would not constitute a legal obstacle to the holding of the plebiscite. At any rate,
the appellant may later question whether the votes of those ultimately declared to be supervisors
should be counted.

Whether or not the agreement negotiated by the appellant union with the employer, during the
pendency of the original petition in the Court of Industrial Relations, should be considered valid and
binding on the workers of the Caloocan shops is a question that should be first passed upon by the
Industrial Court.

IN VIEW OF THE FOREGOING, the order appealed from is affirmed, with costs against appellant
Mechanical Department Labor Union sa Philippine National Railways.
G.R. No. 102130 July 26, 1994

GOLDEN FARMS, INC., petitioner,

vs.
THE HONORABLE SECRETARY OF LABOR and THE PROGRESSIVE FEDERATION OF
LABOR, respondents.

J.V. Yap Law Office for petitioner.

PUNO, J.:

The sole issue for resolution in this Petition for Certiorari with prayer for the issuance of preliminary
injunction and/or restraining order is whether or not petitioner's monthly paid rank-and file employees
can constitute a bargaining unit separate from the existing bargaining unit of its daily paid rank-and-
file employees.

Petitioner Golden Farms, Inc., is a corporation engaged in the production and marketing of bananas
for export. On February 27, 1992, private respondent Progressive Federation of Labor (PFL) filed a
petition before the Med-Arbiter praying for the holding of a certification election among the monthly
paid office and technical rank-and-file employees of petitioner Golden Farms.

Petitioner moved to dismiss the petition on three (3) grounds. First, respondent PFL failed to show
that it was organized as a chapter within petitioner's establishment. Second, there was already an
existing collective bargaining agreement between the rank-and-file employees represented by the
National Federation of Labor (NFL) and petitioner. And third, the employees represented by PFL had
allegedly been disqualified by this Court from bargaining with management in Golden Farms, Inc.,
vs. Honorable Director Pura Ferrer-Calleja, G.R. No. 78755, July 19, 1989. 1

Respondent PFL opposed petitioner's Motion to Dismiss. It countered that the monthly paid office
and technical employees should be allowed to form a separate bargaining unit because they were
expressly excluded from coverage in the Collecting Bargaining Agreement (CBA) between petitioner
and NFL. It also contended that the case invoked by petitioner was inapplicable to the present case.

In its reply, petitioner argued that the monthly paid office and technical employees should have
joined the existing collective bargaining unit of the rank-and-file employees if they are not manegerial
employees.

On April 18, 1991, the Med-Arbiter granted the petition and ordered that a certification election be
conducted, viz:

WHEREFORE, premises considered, the present petition filed by the Progressive

Federation of Labor, for certification election among the office and technical
employees of Golden Farms, Inc., is, as it is hereby, GRANTED with the following
choices:

1. Progressive Federation of Labor (PFL);

2. No. union.
 The designated representation officer is hereby directed to call the parties to a pre-
election conference to thresh out the mechanics of the election and to conduct and
supervise the same within twenty (20) days from receipt by the parties of this Order.
The "Masterlist of Office and Technical Employees" shall be the basis in determining
the employees qualified to vote during the certification election.

SO ORDERED. 2

Petitioner seasonably appealed to public respondent Secretary of Labor. On August 6, 1991,

respondent Secretary of Labor issued the assailed Decision denying the appeal for lack of
merit. 3 Petitioner filed a Motion for Reconsideration but the same was also denied on September 13,
1991.

Thus, this petition for certiorari interposing two (2) issues.

THE CREATION OF AN ADDITIONAL BARGAINING UNIT FOR CERTAIN RANK

AND FILE EMPLOYEES WILL NOT ONLY SPLIT THE EXISTING ONE BUT WILL
ALSO NEGATE THE PRINCIPLE OF RES JUDICATA.

II

THE PROGRESSIVE FEDERATION OF LABOR BEING THE EXCLUSIVE

BARGAINING AGENT OF THE SUPERVISORY EMPLOYEES IS DISQUALIFIED
FROM REPRESENTING THE OFFICE AND TECHNICAL EMPLOYEES.

The petition is devoid of merit.

The monthly paid office and technical rank-and-file employees of petitioner Golden Farms enjoy the
constitutional right to self-organization and collective bargaining. 4 A "bargaining unit" has been
defined as a group of employees of a given employer, comprised of all or less than all of the entire
body of employees, which the collective interest of all the employees, consistent with equity to the
employer, indicate to be the best suited to serve the reciprocal rights and duties of the parties under
the collective bargaining provisions of the law. 5 The community or mutuality of interest is therefore
the essential criterion in the grouping. "And this is so because 'the basic test of an asserted
bargaining unit's acceptability is whether or not it is fundamentally the combination which will best
assure to all employees the exercise of their collective bargaining rights.' 6

In the case at bench, the evidence established that the monthly paid rank-and-file employees of
petitioner primarily perform administrative or clerical work. In contradistinction, the petitioner's daily
paid rank-and-file employees mainly work in the cultivation of bananas in the fields. It is crystal clear
the monthly paid rank-and-file employees of petitioner have very little in common with its daily paid
rank-and-file employees in terms of duties and obligations, working conditions, salary rates, and
skills. To be sure, the said monthly paid rank-and-file employees have even been excluded from the
bargaining unit of the daily paid rank-and-file employees. This dissimilarity of interests warrants the
formation of a separate and distinct bargaining unit for the monthly paid rank-and-file employees of
the petitioner. To rule otherwise would deny this distinct class of employees the right to self-
organization for purposes of collective bargaining. Without the shield of an organization, it will also
expose them to the exploitations of management. So we held in University of the Philippines vs.
Ferrer-Calleja, 7 where we sanctioned the formation of two (2) separate bargaining units within the
establishment, viz:
 [T]he dichotomy of interests, the dissimilarity in the nature of the work and duties as
well as in the compensation and working conditions of the academic and non-
academic personnel dictate the separation of these two categories of employees for
purposes of collective bargaining. The formation of two separate bargaining units, the
first consisting of the rank-and-file non-academic employees, and the second, of the
rank-and-file academic employees, is the set-up that will best assure to all the
employees the exercise of their collective bargaining rights.

Petitioner next contends that these monthly paid office and technical employees are managerial
employees. They allegedly include those in the accounting and personnel department, cashier, and
other employees holding positions with access to classified information.

We are not persuaded. Article 212, paragraph (m) of the Labor Code, as amended, defines as
managerial employee as follows:

"Managerial employee" is one who is vested with power or prerogatives to lay down
and execute management policies and/or to hire, transfer, suspend, lay-off, 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.

Given this definition, the monthly paid office and technical employees, accountants, and
cashiers of the petitioner are not managerial employees for they do not participate in policy-
making but are given cut out policies to execute and standard practices to observe. 8 In the
main, the discharge of their duties does not involve the use of independent judgment. As
factually found by the Med-Arbiter, to wit:

A perusal of the list of the office and technical employees sought to be represented in
the instant case, with their corresponding designation does not show that said Office
and Technical employees exercises supervisory or managerial functions.

The office believes and so hold that the employees whose names appear in the
"Masterlist of Office and Technical Employees" submitted during the hearing are
eligible to join/form a labor organization of their own choice. 9

Our decision in Golden Farms, Inc., vs. Honorable Pura Ferrer-Calleja, op. cit., does not pose any
obstacle in holding a certification election among petitioner's monthly paid rank-and-file employees.
The issue brought to fore in that case was totally different, i.e., whether or not petitioner's
confidential employees, considering the nature of their work, should be included in the bargaining
unit of the daily paid rank-and-file employees. In the case at bench, the monthly paid rank-and-file
employees of petitioner are being separated as a bargaining unit from its daily paid rank-and-file
employees, on the ground that they have different interest to protect. The principle of res
judicata is,therefore, inapplicable.

The second assigned error which was not raised in the proceedings below must necessarily fail. The
alleged error involves a question of fact which this Court cannot resolve. Petitioner submitted this
contention only in its Memorandum dated February 12, 1993. 10 In this Memorandum, petitioner cited
LRD Case No. OXI-UR-70 for Direct Recognition/Certification Election. But even a side glance of the
cited case will reveal that it involves a petition for direct certification among the rank-and-file office
and technical employees of the Golden Farms Inc., (not supervisory employees) under the House of
Investment, Ladislawa Village, Buhaning, Davao City filed by the National Federation of Labor (not
the respondent Progressive Federation of Labor). The averment of petitioner is baseless and its
recklessness borders the contemptuous.

Finally, we note that it was petitioner company that filed the motion to dismiss the petition for
election. The general rule is that an employer has no standing to question a certification election
since this is the sole concern of the workers. 11 Law and policy demand that employers take a strick,
hands-off stance in certification elections. The bargaining representative of employees should be
chosen free from any extraneous influence of management. A labor bargaining representative, to be
effective, must owe its loyalty to the employees alone and to no other.

WHEREFORE, the petition is DISMISSED for lack of merit. With costs against petitioner.

SO ORDERED.
G.R. No. 85343 June 28, 1989

PHILTRANCO SERVICE ENTERPRISES, petitioner,

vs.
BUREAU OF LABOR RELATIONS and KAPISANAN NG MGA KAWANI, ASSISTANT,
MANGGAGAWA AT KONPIDENSIYAL SA PHILTRANCO, respondents.

Bengzon, Zarraga, Narciso, Cudala, Pecson & Bengson for petitioner.

Lily S. Dayaon for KASAMA KO .

GUTIERREZ, JR., J.:

In this petition for certiorari, the petitioner assails the order of the Bureau of Labor Relations (BLR)
dated September 5, 1988. The dispositive portion of the order reads:

WHEREFORE, premises considered, the Order of the Med-Arbiter dated 4 April 1988 is hereby set
aside and vacated and a new one entered ordering the conduct of a certification election among
regular rank-and-file professional, technical, administrative and confidential employees of
respondent company, with the following choices:

1. Kapisanan ng mga Kawani, Assistant Manggagawa at Konpidensyal sa Philtranco

(KASAMA KO)

2. No Union.

Let, therefore the records of the case be remanded to the Office of origin for the
immediate conduct of the election.

SO ORDERED. (Rollo, p. 33)

The antecedent facts are as follows:

Petitioner Philtranco Service Enterprises, Inc. is a land transportation company engaged in the
business of carrying passengers and freight. The company employees included field workers
consisting of drivers, conductors, coach drivers, coach stewards and mechanics and office
employees like clerks, cashiers, programmers, telephone operators, etc.

On February 15, 1988, the Kapisanan ng mga Kawani, Assistant, Manggagawa at Konpidensyal sa
Philtranco (KASAMA KO), a registered labor organization filed a petition for certification election with
the Department of Labor and Employment, alleging among others that:

xxx xxx xxx

3. Petitioner desires to represent all professional, technical, administrative, and

confidential employees personnel of respondent at its establishments in Luzon,
Visayas and Mindanao for purposes of collective bargaining;
 4. The aforementioned employees were always expressly excluded from participating
in the certification election conducted among the rank and file employees (drivers,
conductors, coach drivers, coach stewards, and mechanics) of respondent and are
excluded from the bargaining unit covered by the CBA between respondent and its
rank and file employees. In addition, there exist substantial differences in the terms
and conditions of employment between the above-mentioned employees, hence, the
former are covered by another appropriate bargaining unit which is separate and
distinct from that of the rank and file employees of respondent and; which has been
recognized by the Bureau of Labor Relations and upheld by the Honorable Supreme
Court. Attached hereto as Annex 'A' and Annex 'B' are copies of the decision of the
BLR and the Supreme Court in support thereof;

xxx xxx xxx

6. The petition is supported by the signatures of more than twenty percent (20%) of
all covered employees as provided for by law and which shall be presented during
the initial hearing;

xxx xxx xxx

8. There has been no Consent Election or Certification Election held and conducted
by this Honorable Office for the past three (3) years prior to the filing of this petition in
the bargaining unit petitioner sought to represent, the last Certification Election
having been held last November 27, 1984. Attached hereto as Annex "C" is a copy of
the Order issued by this Honorable Office relative to the result of the last certification
election. (Rollo, pp. 4-5)

On February 24, 1988, the National Mines and Allied Workers Union (NAMAWU-MIF) filed a motion
for intervention alleging that it is the bargaining agent of the workers at Philtranco and as such it has
a substantial interest in the outcome of the petition.

On February 26, 1988, Arbiter Paterno Adap called the parties to a hearing. Philtranco and
NAMAWU were ordered to submit their respective position papers and KASAMA KO was given the
opportunity to submit a reply.

On April 4, 1988, a resolution was rendered with the following dispositive portion:

WHEREFORE, in the light of the foregoing premises, this petition is, as it is hereby
ordered DISMISSED. If there are still individual members of the herein petitioner
eligible to join a labor organization, it is hereby directed that all should be
included/incorporated in the existing bargaining unit.

Parties are further directed/enjoined to device a mechanism for the implementation of

the matter herein treated. (Rollo, pp. 29-30)

KASAMA KO appealed to the Bureau of Labor Relations (BLR) On September 5, 1988 the BLR
reversed the resolution of the Med-Arbiter. A motion for reconsideration was denied in an order
dated October 10, 1988.
As prayed for by the petitioner, a temporary restraining order was issued by this Court on November
7, 1988 restraining the BLR from enforcing and/or carrying out the decision dated September 5,
1988 and the order dated October 10, 1988.

The Labor Code recognizes two (2) principal groups of employees, namely, the managerial and the
rank and file groups. Thus, Art. 212 (k) of the Code provides:

xxx xxx xxx

(k) Managerial employee' is one who is vested with powers or prerogatives to lay
down and execute management policies and/or to hire, transfer, suspend, lay-off,
recall, discharge, assign or discipline employees, or to effectively recommend such
managerial actions. All employees not falling within this definition are considered
rank and file employees for purposes of this Book.

In implementation of the aforequoted provision of the law, Section 11 of Rule II, Book V of the
Omnibus Rules implementing the Labor Code did away with existing supervisors' unions classifying
the members either as managerial or rank and file employees depending on the work they perform.
If they discharge managerial functions, supervisors are prohibited from forming or joining any labor
organization. If they do not perform managerial work, they may join the rank and file union and if
none exists, they may form one such rank and file organization. This rule was emphasized in the
case of Bulletin Publishing Corp. v. Sanchez, (144 SCRA 628 [1986]).

It, therefore, follows that the members of the KASAMA KO who are professional, technical,
administrative and confidential personnel of PHILTRANCO performing managerial functions are not
qualified to join, much less form a union. This rationalizes the exclusion of managers and
confidential employees exercising managerial functions from the ambit of the collective bargaining
unit. As correctly observed by Med-Arbiter Adap:

... managerial and confidential employees were expressly excluded within the
operational ambit of the bargaining unit for the simple reason that under the law,
managers are disqualified to be members of a labor organization.

On the other hand, confidential workers were not included because either they were
performing managerial functions and/or their duties and responsibilities were
considered or may be categorized as part and parcel of management as the primary
reason for their exclusion in the bargaining unit. The other categorized employees
were likewise not included because parties have agreed on the fact that the
aforementioned group of workers are not qualified to join a labor organization at the
time the agreement was executed and that they were classified as outside the
parameter of the bargaining unit. (Rollo, pp. 28-29)

The respondents, on the other hand, aver that the members of the respondent union are rank and
file employees qualified to form a union. In fact their status as rank and file employees was allegedly
recognized by this Court in the case of Pantranco South Express, Inc. v. NAMAWU, (G.R. No.
67475, July 30, 1984).

The reliance on the Pantranco South Express, Inc. case is misplaced. The petition filed by
Pantranco South Express Inc. simply asked for a ruling that certain employees were performing
managerial functions. We denied the petition for lack of merit in a minute resolution. There was
absolutely no discussion on the recognition of another separate rank and file union in addition to the
existing bargaining unit.
There is no conflict. The employees of Philtranco have been appraised and their functions
evaluated. Managers by any name may not join the rank and file union. On the other hand, those
who are rank and file workers may join the existing bargaining unit instead of organizing another
bargaining unit and compelling the employer to deal with it.

We are constrained to disallow the formation of another union. There is no dispute that there exists a
labor union in the company, herein intervenor, the NAMAWU-MIF which is the collective bargaining
agent of the rank and file employees in PHILTRANCO.

Article 2 of the Collective Bargaining Agreement between PHILTRANCO and NAMAWU-MIF under
the sub-title Appropriate Bargaining Unit provides:

Section 1 -The appropriate bargaining unit covered by this agreement consists of all
regular rank- and file employees of the company. Managerial, confidential, casuals,
temporary, probationary and contractual employees as well as trainees, apprentices,
security personnel and foreman are excluded from the bargaining unit and therefore,
not covered by this AGREEMENT. The job description outside the bargaining unit
are enumerated in the list hereto attached as Annex '1' and made an integral part
hereof (Emphasis supplied; Rollo, p. 27)

We see no need for the formation of another union in PHILTRANCO. The qualified members of the
KASAMA KO may join the NAMAWU-MIF if they want to be union members, and to be consistent
with the one-union, one-company policy of the Department of Labor and Employment, and the laws
it enforces. As held in the case of General Rubber and Footwear Corp. v. Bureau of Labor Relations
(155 SCRA 283 [1987]):

... It has been the policy of the Bureau to encourage the formation of an employer
unit 'unless circumstances otherwise require. The proliferation of unions in an
employer unit is discouraged as a matter of policy unless there are compelling
reasons which would deny a certain class of employees the right to self-organization
for purposes of collective bargaining. This case does not fall squarely within the
exception. (Emphasis supplied).

There are no compelling reasons in this case such as a denial to the KASAMA KO group of the right
to join the certified bargaining unit or substantial distinctions warranting the recognition of a separate
group of rank and file workers. Precisely, NAMAWU-MIF intervened to make it clear it has no
objections to qualified rank and file workers joining its union.

It is natural in almost all fairly sized companies to have groups of workers discharging different
functions. No company could possibly have all employees performing exactly the same work. Variety
of tasks is to be expected. It would not be in the interest of sound labor-management relations if
each group of employees assigned to a specialized function or section would decide to break away
from their fellow-workers and form their own separate bargaining unit. We cannot allow one unit for
typists and clerks, one unit for accountants, another unit for messengers and drivers, and so on in
needless profusion. Where shall the line be drawn? The questioned decision of the public
respondent can only lead to confusion, discord and labor strife.

The respondents state that this case is an exception to the general rule considering that substantial
differences exist between the office employees or professional, technical, administrative and
confidential employees vis-a-vis the field workers or drivers, conductors and mechanics of the
petitioner. Against this contention, we find that the "substantial differences" in the terms and
conditions of employment between the private respondent's members and the rest of the company's
rank and file employees are more imagined than real. We agree with the petitioner that the
differences alleged are not substantial or significant enough to merit the formation of another union.

PHILTRANCO is a large bus company engaged in the business of carrying passengers and freight,
servicing Luzon, Visayas and Mindanao. Certainly there is a commonality of interest among filing
clerks, dispatchers, drivers, typists, and field men. They are all interested in the progress of their
company and in each worker sharing in the fruits of their endeavors equitably and generously. Their
functions mesh with one another. One group needs the other in the same way that the company
needs them all. The drivers, mechanics and conductors are necessary for the company but
technical, administrative and office personnel are also needed and equally important for the smooth
operation of the business. There may be differences as to the nature of their individual assignments
but the distinctions are not enough to warrant the formation of separate unions. The private
respondent has not even shown that a separate bargaining unit would be beneficial to the
employees concerned. Office employees also belong to the rank and file. There is an existing
employer wide unit in the company represented by NAMAWU-MIF. And as earlier stated, the fact
that NAMAWU-MIF moved to intervene in the petition for certification election filed by KASAMA KO
negates the allegations that "substantial differences" exist between the employees concerned. We
find a commonality of interest among them. There are no compelling reasons for the formation of
another union.

We quote with favor Med-Arbiter Adap's rationale, to wit:

... It is against the policy of the Department of Labor to dismember the already wide
existing bargaining unit because of its well established goal towards a single
employer wide unit which is more to the broader and greater benefit of the
employees working force.

The philosophy is to avoid fragmentation of the bargaining unit so as to strengthen

the employees bargaining power with the management. To do otherwise, would be
contrary, inimical and repugnant to the objectives of a strong and dynamic unionism.
Let there be a unified whole rather than a divisive one, let them speak as one in a
clear resonant voice unmarred by dissension towards progressive unionism. (Rollo,
p. 29)

WHEREFORE, the decision of the Bureau of Labor Relations, dated September 5, 1988 and the
Order dated October 10, 1988 are hereby SET ASIDE. The resolution of the Med-Arbiter dated April
4, 1988 is REINSTATED. The restraining order issued by the Court on November 7, 1988 is made
permanent.

SO ORDERED.
G.R. No. 110399 August 15, 1997

SAN MIGUEL CORPORATION SUPERVISORS AND EXEMPT UNION AND ERNESTO L.

PONCE, President, petitioners,
vs.
HONORABLE BIENVENIDO E. LAGUESMA IN HIS CAPACITY AS UNDERSECRETARY OF
LABOR AND EMPLOYMENT, HONORABLE DANILO L. REYNANTE IN HIS CAPACITY AS MED-
ARBITER AND SAN MIGUEL CORPORATION, respondents.

ROMERO, J.:

This is a Petition for Certiorari with Prayer for the Issuance of Preliminary Injunction seeking to
reverse and set aside the Order of public respondent, Undersecretary of the Department of Labor
and Employment, Bienvenido E. Laguesma, dated March 11, 1993, in Case No. OS MA A-2-70-
911 entitled "In Re: Petition for Certification Election Among the Supervisory and Exempt Employees
of the San Miguel Corporation Magnolia Poultry Plants of Cabuyao, San Fernando and Otis, San
Miguel Corporation Supervisors and Exempt Union, Petitioner." The Order excluded the employees
under supervisory levels 3 and 4 and the so-called exempt employees from the proposed bargaining
unit and ruled out their participation in the certification election.

The antecedent facts are undisputed:

On October 5, 1990, petitioner union filed before the Department of Labor and Employment (DOLE)
a Petition for Direct Certification or Certification Election among the supervisors and exempt
employees of the SMC Magnolia Poultry Products Plants of Cabuyao, San Fernando and Otis.

On December 19, 1990, Med-Arbiter Danilo L. Reynante issued an Order ordering the conduct of
certification election among the supervisors and exempt employees of the SMC Magnolia Poultry
Products Plants of Cabuyao, San Fernando and Otis as one bargaining unit.

On January 18, 1991, respondent San Miguel Corporation filed a Notice of Appeal with
Memorandum on Appeal, pointing out, among others, the Med-Arbiter's error in grouping together all
three (3) separate plants, Otis, Cabuyao and San Fernando, into one bargaining unit, and in
including supervisory levels 3 and above whose positions are confidential in nature.

On July 23, 1991, the public respondent, Undersecretary Laguesma, granted respondent company's
Appeal and ordered the remand of the case to the Med-Arbiter of origin for determination of the true
classification of each of the employees sought to be included in the appropriate bargaining unit.

Upon petitioner-union's motion dated August 7, 1991, Undersecretary Laguesma granted the
reconsideration prayed for on September 3, 1991 and directed the conduct of separate certification
elections among the supervisors ranked as supervisory levels 1 to 4 (S1 to S4) and the exempt
employees in each of the three plants at Cabuyao, San Fernando and Otis.

On September 21, 1991, respondent company, San Miguel Corporation filed a Motion for
Reconsideration with Motion to suspend proceedings.

On March 11, 1993, an Order was issued by the public respondent granting the Motion, citing the
doctrine enunciated in Philips Industrial Development, Inc. v. NLRC 2 case. Said Order reads in part:
 . . . Confidential employees, like managerial employees, are not allowed to form, join
or assist a labor union for purposes of collective bargaining.

In this case, S3 and S4 Supervisors and the so-called exempt employees are
admittedly confidential employees and therefore, they are not allowed to form, join or
assist a labor union for purposes of collective bargaining following the above court's
ruling. Consequently, they are not allowed to participate in the certification election.

WHEREFORE, the Motion is hereby granted and the Decision of this Office dated 03
September 1991 is hereby modified to the extent that employees under supervisory
levels 3 and 4 (S3 and S4) and the so-called exempt employees are not allowed to
join the proposed bargaining unit and are therefore excluded from those who could
participate in the certification election. 3

Hence this petition.

For resolution in this case are the following issues:

1. Whether Supervisory employees 3 and 4 and the exempt

employees of the company are considered confidential employees,
hence ineligible from joining a union.

2. If they are not confidential employees, do the employees of the

three plants constitute an appropriate single bargaining unit.

On the first issue, this Court rules that said employees do not fall within the term "confidential
employees" who may be prohibited from joining a union.

There is no question that the said employees, supervisors and the exempt employees, are not
vested with the powers and prerogatives to lay down and execute management policies and/or to
hire, transfer, suspend, layoff, recall, discharge or dismiss employees. They are, therefore, not
qualified to be classified as managerial employees who, under Article 245 4 of the Labor Code, are
not eligible to join, assist or form any labor organization. In the very same provision, they are not
allowed membership in a labor organization of the rank-and-file employees but may join, assist or
form separate labor organizations of their own. The only question that need be addressed is whether
these employees are properly classified as confidential employees or not.

Confidential employees are those who (1) assist or act in a confidential capacity, (2) to persons who
formulate, determine, and effectuate management policies in the field of labor relations. 5 The two
criteria are cumulative, and both must be met if an employee is to be considered a confidential
employee — that is, the confidential relationship must exist between the employee and his
supervisor, and the supervisor must handle the prescribed responsibilities relating to labor
relations. 6

The exclusion from bargaining units of employees who, in the normal course of their duties, become
aware of management policies relating to labor relations is a principal objective sought to be
accomplished by the ''confidential employee rule." The broad rationale behind this rule is that
employees should not be placed in a position involving a potential conflict of
interests. 7 "Management should not be required to handle labor relations matters through
employees who are represented by the union with which the company is required to deal and who in
the normal performance of their duties may obtain advance information of the company's position
with regard to contract negotiations, the disposition of grievances, or other labor relations matters." 8
There have been precedents in this regards, thus in Bulletin Publishing Company v. Hon. Augusto
Sanchez, 9 the Court held that "if these managerial employees would belong to or be affiliated with a
Union, the latter might not be assured of their loyalty to the Union in view of evident conflict of
interest. The Union can also become company-dominated with the presence of managerial
employees in Union membership." The same rationale was applied to confidential employees in
"Golden Farms, Inc. v. Ferrer-Calleja" 10 and in the more recent case of "Philips Industrial
Development, Inc. v. NLRC" 11 which held that confidential employees, by the very nature of their
functions, assist and act in a confidential capacity to, or have access to confidential matters of,
persons who exercise managerial functions in the field of labor relations. Therefore, the rationale
behind the ineligibility of managerial employees to form, assist or join a labor union was held equally
applicable to them. 12

An important element of the "confidential employee rule" is the employee's need to use labor
relations information. Thus, in determining the confidentiality of certain employees, a key question
frequently considered is the employee's necessary access to confidential labor relations
information. 13

It is the contention of respondent corporation that Supervisor employees 3 and 4 and the exempt
employees come within the meaning of the term "confidential employees" primarily because they
answered in the affirmative when asked "Do you handle confidential data or documents?" in the
Position Questionnaires submitted by the Union. 14 In the same questionnaire, however, it was also
stated that the confidential information handled by questioned employees relate to product
formulation, product standards and product specification which by no means relate to "labor
relations." 15

Granting arguendo that an employee has access to confidential labor relations information but such
is merely incidental to his duties and knowledge thereof is not necessary in the performance of such
duties, said access does not render the employee a confidential employee. 16 "If access to
confidential labor relations information is to be a factor in the determination of an employee's
confidential status, such information must relate to the employer's labor relations policies. Thus, an
employee of a labor union, or of a management association, must have access to confidential labor
relations information with respect to his employer, the union, or the association, to be regarded a
confidential employee, and knowledge of labor relations information pertaining to the companies with
which the union deals, or which the association represents, will not cause an employee to be
excluded from the bargaining unit representing employees of the union or association." 17 "Access to
information which is regarded by the employer to be confidential from the business standpoint, such
as financial information 18 or technical trade secrets, will not render an employee a confidential
employee." 19

Herein listed are the functions of supervisors 3 and higher:

1. To undertake decisions to discontinue/temporarily stop shift

operations when situations require.

2. To effectively oversee the quality control function at the processing

lines in the storage of chicken and other products.

3. To administer efficient system of evaluation of products in the

outlets.

4. To be directly responsible for the recall, holding and rejection of

direct manufacturing materials.
 5. To recommend and initiate actions in the maintenance of sanitation
and hygiene throughout the plant. 20

It is evident that whatever confidential data the questioned employees may handle will have to relate
to their functions. From the foregoing functions, it can be gleaned that the confidential information
said employees have access to concern the employer's internal business operations. As held
in Westinghouse Electric Corporation v. National Labor Relations Board, 21 "an employee may not be
excluded from appropriate bargaining unit merely because he has access to confidential information
concerning employer's internal business operations and which is not related to the field of labor
relations."

It must be borne in mind that Section 3 of Article XIII of the 1987 Constitution mandates the State to
guarantee to "all" workers the right to self-organization. Hence, confidential employees who may be
excluded from bargaining unit must be strictly defined so as not to needlessly deprive many
employees of their right to bargain collectively through representatives of their choosing. 22

In the case at bar, supervisors 3 and above may not be considered confidential employees merely
because they handle "confidential data" as such must first be strictly classified as pertaining to labor
relations for them to fall under said restrictions. The information they handle are properly classifiable
as technical and internal business operations data which, to our mind, has no relevance to
negotiations and settlement of grievances wherein the interests of a union and the management are
invariably adversarial. Since the employees are not classifiable under the confidential type, this
Court rules that they may appropriately form a bargaining unit for purposes of collective bargaining.
Furthermore, even assuming that they are confidential employees, jurisprudence has established
that there is no legal prohibition against confidential employees who are not performing managerial
functions to form and join a union. 23

In this connection, the issue of whether the employees of San Miguel Corporation Magnolia Poultry
Products Plants of Cabuyao, San Fernando, and Otis constitute a single bargaining unit needs to be
threshed out.

It is the contention of the petitioner union that the creation of three (3) separate bargaining units, one
each for Cabuyao, Otis and San Fernando as ruled by the respondent Undersecretary, is contrary to
the one-company, one-union policy. It adds that Supervisors level 1 to 4 and exempt employees of
the three plants have a similarity or a community of interests.

This Court finds the contention of the petitioner meritorious.

An appropriate bargaining unit may be defined as "a group of employees of a given employer,
comprised of all or less than all of the entire body of employees, which the collective interest of all
the employees, consistent with equity to the employer, indicate to be best suited to serve the
reciprocal rights and duties of the parties under the collective bargaining provisions of the
law." 24

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. 25

It is readily seen that the employees in the instant case have "community or mutuality of interests,"
which is the standard in determining the proper constituency of a collective bargaining unit. 26 It is
undisputed that they all belong to the Magnolia Poultry Division of San Miguel Corporation. This
means that, although they belong to three different plants, they perform work of the same nature,
receive the same wages and compensation, and most importantly, share a common stake in
concerted activities.

In light of these considerations, the Solicitor General has opined that separate bargaining units in the
three different plants of the division will fragmentize the employees of the said division, thus greatly
diminishing their bargaining leverage. Any concerted activity held against the private respondent for
a labor grievance in one bargaining unit will, in all probability, not create much impact on the
operations of the private respondent. The two other plants still in operation can well step up their
production and make up for the slack caused by the bargaining unit engaged in the concerted
activity. This situation will clearly frustrate the provisions of the Labor Code and the mandate of the
Constitution. 27

The fact that the three plants are located in three different places, namely, in Cabuyao, Laguna, in
Otis, Pandacan, Metro Manila, and in San Fernando, Pampanga is immaterial. Geographical
location can be completely disregarded if the communal or mutual interests of the employees are not
sacrificed as demonstrated in UP v. Calleja-Ferrer where all non-academic rank and file employee of
the University of the Philippines in Diliman, Quezon City, Padre Faura, Manila, Los Baños, Laguna
and the Visayas were allowed to participate in a certification election. We rule that the distance
among the three plants is not productive of insurmountable difficulties in the administration of union
affairs. Neither are there regional differences that are likely to impede the operations of a single
bargaining representative.

WHEREFORE, the assailed Order of March 11, 1993 is hereby SET ASIDE and the Order of the
Med-Arbiter on December 19, 1990 is REINSTATED under which a certification election among the
supervisors (level 1 to 4) and exempt employees of the San Miguel Corporation Magnolia Poultry
Products Plants of Cabuyao, San Fernando, and Otis as one bargaining unit is ordered conducted.

SO ORDERED.

Regalado, Puno, Mendoza and Torres, Jr., JJ., concur.

G.R. No. 77395 November 29, 1988

BELYCA CORPORATION, petitioner,

vs.
DIR. PURA FERRER CALLEJA, LABOR RELATIONS, MANILA, MINISTRY OF LABOR AND
EMPLOYMENT; MED-ARBITER, RODOLFO S. MILADO, MINISTRY OF LABOR AND
EMPLOYMENT, REGIONAL OFFICE NO. 10 AND ASSOCIATED LABOR UNION (ALU-TUCP),
MINDANAO REGIONAL OFFICE, CAGAYAN DE ORO CITY, respondents.

Soriano and Arana Law Offices for petitioner.

The Solicitor General for public respondent.

Francisco D. Alas for respondent Associated Labor Unions-TUCP.

PARAS, J.:

This is a petition for certiorari and prohibition with preliminary injunction seeking to annul or to set aside the resolution of the Bureau of Labor
Relations dated November 24, 1986 and denying the appeal, and the Bureau's resolution dated January 13, 1987 denying petitioner's motion
for reconsideration.

The dispositive portion of the questioned resolution dated November 24, 1986 (Rollo, p. 4) reads as
follows:

WHEREFORE, in view of all the foregoing considerations, the Order is affirmed and
the appeal therefrom denied.

Let, therefore, the pertinent records of the case be remanded to the office of origin
for the immediate conduct of the certification election.

The dispositive portion of the resolution dated January 13, 1987 (Rollo, p. 92) reads, as follows:

WHEREFORE, the Motion for Reconsideration filed by respondent Belyca

Corporation (Livestock Agro-Division) is hereby dismissed for lack of merit and the
Bureau's Resolution dated 24 November 1986 is affirmed. Accordingly, let the
records of this case be immediately forwarded to the Office of origin for the holding of
the certification elections.

No further motion shall hereafter be entertained.

The antecedents of the case are as follows:

On June 3, 1986, private respondent Associated Labor Union (ALU)-TUCP, a legitimate labor
organization duly registered with the Ministry of Labor and Employment under Registration
Certificate No. 783-IP, filed with the Regional Office No. 10, Ministry of Labor and Employment at
Cagayan de Oro City, a petition for direct certification as the sole and exclusive bargaining agent of
all the rank and file employees/workers of Belyca Corporation (Livestock and Agro-Division), a duly
organized, registered and existing corporation engaged in the business of poultry raising, piggery
and planting of agricultural crops such as corn, coffee and various vegetables, employing
approximately 205 rank and file employees/workers, the collective bargaining unit sought in the
petition, or in case of doubt of the union's majority representation, for the issuance of an order
authorizing the immediate holding of a certification election (Rollo, p. 18). Although the case was
scheduled for hearing at least three times, no amicable settlement was reached by the parties.
During the scheduled hearing of July 31, 1986 they, however, agreed to submit simultaneously their
respective position papers on or before August 11, 1986 (rollo. p. 62).

Petitioner ALU-TUCP, private respondent herein, in its petition and position paper alleged, among
others, (1) that there is no existing collective bargaining agreement between the respondent
employer, petitioner herein, and any other existing legitimate labor unions; (2) that there had neither
been a certification election conducted in the proposed bargaining unit within the last twelve (12)
months prior to the filing of the petition nor a contending union requesting for certification as the. sole
and exclusive bargaining representative in the proposed bargaining unit; (3) that more than a
majority of respondent employer's rank-and-file employees/workers in the proposed bargaining unit
or one hundred thirty-eight (138) as of the date of the filing of the petition, have signed membership
with the ALU-TUCP and have expressed their written consent and authorization to the filing of the
petition; (4) that in response to petitioner union's two letters to the proprietor/ General Manager of
respondent employer, dated April 21, 1986 and May 8, 1 986, requesting for direct recognition as the
sole and exclusive bargaining agent of the rank-and-file workers, respondent employer has locked
out 119 of its rank-and-file employees in the said bargaining unit and had dismissed earlier the local
union president, vice-president and three other active members of the local unions for which an
unfair labor practice case was filed by petitioner union against respondent employer last July 2, 1986
before the NLRC in Cagayan de Oro City (Rollo, pp. 18; 263). <äre||anº•1àw>

Respondent employer, on the other hand, alleged in its position paper, among others, (1) that due to
the nature of its business, very few of its employees are permanent, the overwhelming majority of
which are seasonal and casual and regular employees; (2) that of the total 138 rank-and-file
employees who authorized, signed and supported the filing of the petition (a) 14 were no longer
working as of June 3, 1986 (b) 4 resigned after June, 1986 (c) 6 withdrew their membership from
petitioner union (d) 5 were retrenched on June 23, 1986 (e) 12 were dismissed due to malicious
insubordination and destruction of property and (f) 100 simply abandoned their work or stopped
working; (3) that the 128 incumbent employees or workers of the livestock section were merely
transferred from the agricultural section as replacement for those who have either been dismissed,
retrenched or resigned; and (4) that the statutory requirement for holding a certification election has
not been complied with by the union (Rollo, p. 26).

The Labor Arbiter granted the certification election sought for by petitioner union in his order dated
August 18, 1986 (Rollo, p. 62).

On February 4, 1987, respondent employer Belyca Corporation, appealed the order of the Labor
Arbiter to the Bureau of Labor Relations in Manila (Rollo, p. 67) which denied the appeal (Rollo, p.
80) and the motion for reconsideration (Rollo, p. 92). Thus, the instant petition received in this Court
by mail on February 20, 1987 (Rollo, p. 3).

In the resolution of March 4, 1987, the Second Division of this Court required respondent Union to
comment on the petition and issued a temporary restraining order (,Rollo, p. 95).

Respondent union filed its comment on March 30, 1987 (Rollo, p. 190); public respondents filed its
comment on April 8, 1987 (Rollo, p. 218).

On May 4, 1987, the Court resolved to give due course to the petition and to require the parties to
submit their respective memoranda within twenty (20) days from notice (Rollo, p. 225).
The Office of the Solicitor General manifested on June 11, 1987 that it is adopting the comment for
public respondents as its memorandum (Rollo, p. 226); memorandum for respondent ALU was filed
on June 30, 1987 (Rollo, p. 231); and memorandum for petitioner, on July 30, 1987 (Rollo, p. 435).

The issues raised in this petition are:

WHETHER OR NOT THE PROPOSED BARGAINING UNIT IS AN APPROPRIATE

BARGAINING UNIT.

II

WHETHER OR NOT THE STATUTORY REQUIREMENT OF 30% (NOW 20%) OF

THE EMPLOYEES IN THE PROPOSED BARGAINING UNIT, ASKING FOR A
CERTIFICATION ELECTION HAD BEEN STRICTLY COMPLIED WITH.

In the instant case, respondent ALU seeks direct certification as the sole and exclusive bargaining
agent of all the rank-and-file workers of the livestock and agro division of petitioner BELYCA
Corporation (Rollo, p. 232), engaged in piggery, poultry raising and the planting of agricultural crops
such as corn, coffee and various vegetables (Rollo, p. 26). But petitioner contends that the
bargaining unit must include all the workers in its integrated business concerns ranging from piggery,
poultry, to supermarts and cinemas so as not to split an otherwise single bargaining unit into
fragmented bargaining units (Rollo, p. 435). <äre||a nº•1àw>

The Labor Code does not specifically define what constitutes an appropriate collective bargaining
unit. Article 256 of the Code provides:

Art. 256. Exclusive bargaining representative.—The labor

organization designated or selected by the majority of the employees
in an appropriate collective bargaining unit shall be exclusive
representative of the employees in such unit for the purpose of
collective bargaining. However, an individual employee or group of
employee shall have the right at any time to present grievances to
their employer.

According to Rothenberg, a proper bargaining unit maybe said to be a group of employees of a

given employer, comprised of all or less than all of the entire body of employees, which the collective
interests of all the employees, consistent with equity to the employer, indicate to be best suited to
serve reciprocal rights and duties of the parties under the collective bargaining provisions of the law
(Rothenberg in Labor Relations, p. 482).

This Court has already taken cognizance of the crucial issue of determining the proper constituency
of a collective bargaining unit.

Among the factors considered in Democratic Labor Association v. Cebu Stevedoring Co. Inc. (103
Phil 1103 [1958]) are: "(1) will of employees (Glove Doctrine); (2) affinity and unity of employee's
interest, such as substantial similarity of work and duties or similarity of compensation and working
conditions; (3) prior collective bargaining history; and (4) employment status, such as temporary,
seasonal and probationary employees".
Under the circumstances of that case, the Court stressed the importance of the fourth factor and
sustained the trial court's conclusion that two separate bargaining units should be formed in dealing
with respondent company, one consisting of regular and permanent employees and another
consisting of casual laborers or stevedores. Otherwise stated, temporary employees should be
treated separately from permanent employees. But more importantly, this Court laid down the test of
proper grouping, which is community and mutuality of interest.

Thus, in a later case, (Alhambra Cigar and Cigarette Manufacturing Co. et al. v. Alhambra
Employees' Association 107 Phil. 28 [1960]) where the employment status was not at issue but the
nature of work of the employees concerned; the Court stressed the importance of the second factor
otherwise known as the substantial-mutual-interest test and found no reason to disturb the finding of
the lower Court that the employees in the administrative, sales and dispensary departments perform
work which has nothing to do with production and maintenance, unlike those in the raw leaf, cigar,
cigarette and packing and engineering and garage departments and therefore community of interest
which justifies the format or existence as a separate appropriate collective bargaining unit.

Still later in PLASLU v. CIR et al. (110 Phil. 180 [1960]) where the employment status of the
employees concerned was again challenged, the Court reiterating the rulings, both in Democratic
Labor Association v. Cebu Stevedoring Co. Inc. supra and Alhambra Cigar and Cigarette Co. et al.
v. Alhambra Employees' Association (supra) held that among the factors to be considered are:
employment status of the employees to be affected, that is the positions and categories of work to
which they belong, and the unity of employees' interest such as substantial similarity of work and
duties.

In any event, whether importance is focused on the employment status or the mutuality of interest of
the employees concerned "the basic test of an asserted bargaining unit's acceptability is whether or
not it is fundamentally the combination which will best assure to all employees the exercise of their
collective bargaining rights (Democratic Labor Association v. Cebu Stevedoring Co. Inc. supra)

Hence, still later following the substantial-mutual interest test, the Court ruled that there is a
substantial difference between the work performed by musicians and that of other persons who
participate in the production of a film which suffice to show that they constitute a proper bargaining
unit. (LVN Pictures, Inc. v. Philippine Musicians Guild, 1 SCRA 132 [1961]).

Coming back to the case at bar, it is beyond question that the employees of the livestock and agro
division of petitioner corporation perform work entirely different from those performed by employees
in the supermarts and cinema. Among others, the noted difference are: their working conditions,
hours of work, rates of pay, including the categories of their positions and employment status. As
stated by petitioner corporation in its position paper, due to the nature of the business in which its
livestock-agro division is engaged very few of its employees in the division are permanent, the
overwhelming majority of which are seasonal and casual and not regular employees (Rollo, p. 26).
Definitely, they have very little in common with the employees of the supermarts and cinemas. To
lump all the employees of petitioner in its integrated business concerns cannot result in an
efficacious bargaining unit comprised of constituents enjoying a community or mutuality of interest.
Undeniably, the rank and file employees of the livestock-agro division fully constitute a bargaining
unit that satisfies both requirements of classification according to employment status and of the
substantial similarity of work and duties which will ultimately assure its members the exercise of their
collective bargaining rights.

II
It is undisputed that petitioner BELYCA Corporation (Livestock and Agro Division) employs more or
less two hundred five (205) rank-and-file employees and workers. It has no existing duly certified
collective bargaining agreement with any legitimate labor organization. There has not been any
certification election conducted in the proposed bargaining unit within the last twelve (12) months
prior to the filing of the petition for direct certification and/or certification election with the Ministry of
Labor and Employment, and there is no contending union requesting for certification as the sole and
exclusive bargaining representative in the proposed bargaining unit.

The records show that on the filing of the petition for certification and/or certification election on June
3, 1986; 124 employees or workers which are more than a majority of the rank-and-file employees or
workers in the proposed bargaining unit had signed membership with respondent ALU-TUCP and
had expressed their written consent and authorization to the filing of the petition. Thus, the Labor
Arbiter ordered the certification election on August 18, 1986 on a finding that 30% of the statutory
requirement under Art. 258 of the Labor Code has been met.

But, petitioner corporation contends that after June 3, 1986 four (4) employees resigned; six (6)
subsequently withdrew their membership; five (5) were retrenched; twelve (12) were dismissed for
illegally and unlawfully barricading the entrance to petitioner's farm; and one hundred (100) simply
abandoned their work.

Petitioner's claim was however belied by the Memorandum of its personnel officer to the 119
employees dated July 28, 1986 showing that the employees were on strike, which was confirmed by
the finding of the Bureau of Labor Relations to the effect that they went on strike on July 24, 1986
(Rollo, p. 419). Earlier the local union president, Warrencio Maputi; the Vice-president, Gilbert
Redoblado and three other active members of the union Carmen Saguing, Roberto Romolo and
Iluminada Bonio were dismissed and a complaint for unfair labor practice, illegal dismissal etc. was
filed by the Union in their behalf on July 2, 1986 before the NLRC of Cagayan de Oro City (Rollo, p.
415). The complaint was amended on August 20, 1986 for respondent Union to represent
<äre||anº•1àw>

Warrencio Maputi and 137 others against petitioner corporation and Bello Casanova President and
General Manager for unfair labor practice, illegal dismissal, illegal lockout, etc. (Rollo, p. 416).

Under Art. 257 of the Labor Code once the statutory requirement is met, the Director of Labor
Relations has no choice but to call a certification election (Atlas Free Workers Union AFWU PSSLU
Local v. Noriel, 104 SCRA 565 [1981]; Vismico Industrial Workers Association (VIWA) v. Noriel, 131
SCRA 569 [1984]) It becomes in the language of the New Labor Code "Mandatory for the Bureau to
conduct a certification election for the purpose of determining the representative of the employees in
the appropriate bargaining unit and certify the winner as the exclusive bargaining representative of
all employees in the unit." (Federacion Obrera de la Industria Tabaquera y Otros Trabajadores de
Filipinas v. Noriel, 72 SCRA 24 [1976]; Kapisanan Ng Mga Manggagawa v. Noriel, 77 SCRA 414
[1977]); more so when there is no existing collective bargaining agreement. (Samahang
Manggagawa Ng Pacific Mills, Inc. v. Noriel, 134 SCRA 152 [1985]); and there has not been a
certification election in the company for the past three years (PLUM Federation of Industrial and
Agrarian Workers v. Noriel, 119 SCRA 299 [1982]) as in the instant case.

It is significant to note that 124 employees out of the 205 employees of the Belyca Corporation have
expressed their written consent to the certification election or more than a majority of the rank and
file employees and workers; much more than the required 30% and over and above the present
requirement of 20% by Executive Order No. 111 issued on December 24, 1980 and applicable only
to unorganized establishments under Art. 257, of the Labor Code, to which the BELYCA Corporation
belong (Ass. Trade Unions (ATU) v. Trajano, G.R. No. 75321, June 20, 1988).) More than that, any
doubt cast on the authenticity of signatures to the petition for holding a certification election cannot
be a bar to its being granted (Filipino Metals Corp. v. Ople 107 SCRA 211 [1981]). Even doubts as to
the required 30% being met warrant holding of the certification election (PLUM Federation of
Industrial and Agrarian Workers v. Noriel, 119 SCRA 299 [1982]). In fact, once the required
percentage requirement has been reached, the employees' withdrawal from union membership
taking place after the filing of the petition for certification election will not affect said petition. On the
contrary, the presumption arises that the withdrawal was not free but was procured through duress,
coercion or for a valuable consideration (La Suerte Cigar and Cigarette Factory v. Director of the
Bureau of Labor Relations, 123 SCRA 679 [1983]). Hence, the subsequent disaffiliation of the six (6)
employees from the union will not be counted against or deducted from the previous number who
had signed up for certification elections Vismico Industrial Workers Association (VIWA) v. Noriel 131
SCRA 569 [1984]). Similarly, until a decision, final in character, has been issued declaring the strike
<äre||anº•1àw>

illegal and the mass dismissal or retrenchment valid, the strikers cannot be denied participation in
the certification election notwithstanding, the vigorous condemnation of the strike and the fact that
the picketing were attended by violence. Under the foregoing circumstances, it does not necessarily
follow that the strikers in question are no longer entitled to participate in the certification election on
the theory that they have automatically lost their jobs. (Barrera v. CIR, 107 SCRA 596 [1981]). For
obvious reasons, the duty of the employer to bargain collectively is nullified if the purpose of the
dismissal of the union members is to defeat the union in the consent requirement for certification
election. (Samahang Manggagawa Ng Via Mare v. Noriel, 98 SCRA 507 [1980]). As stressed by this
Court, the holding of a certification election is a statutory policy that should not be circumvented.
(George and Peter Lines Inc. v. Associated Labor Unions (ALU), 134 SCRA 82 [1986]).

Finally, as a general rule, a certification election is the sole concern of the workers. The only
exception is where the employer has to file a petition for certification election pursuant to Art. 259 of
the Labor Code because the latter was requested to bargain collectively. But thereafter the role of
the employer in the certification process ceases. The employer becomes merely a bystander (Trade
Union of the Phil. and Allied Services (TUPAS) v. Trajano, 120 SCRA 64 [1983]).

There is no showing that the instant case falls under the above mentioned exception. However, it will
be noted that petitioner corporation from the outset has actively participated and consistently taken
the position of adversary in the petition for direct certification as the sole and exclusive bargaining
representative and/or certification election filed by respondent Associated Labor Unions (ALU)-
TUCP to the extent of filing this petition for certiorari in this Court. Considering that a petition for
certification election is not a litigation but a mere investigation of a non-adversary character to
determining the bargaining unit to represent the employees (LVN Pictures, Inc. v. Philippine
Musicians Guild, supra; Bulakena Restaurant & Caterer v. Court of Industrial Relations, 45 SCRA 88
[1972]; George Peter Lines, Inc. v. Associated Labor Union, 134 SCRA 82 [1986]; Tanduay Distillery
Labor Union v. NLRC, 149 SCRA 470 [1987]), and its only purpose is to give the employees true
representation in their collective bargaining with an employer (Confederation of Citizens Labor
Unions CCLU v. Noriel, 116 SCRA 694 [1982]), there appears to be no reason for the employer's
objection to the formation of subject union, much less for the filing of the petition for a certification
election.

PREMISES CONSIDERED, (a) the petition is DISMISSED for lack of merit (b) resolution of the
Bureau of Labor Relations dated Nov. 24, 1986 is AFFIRMED; and the temporary restraining order
issued by the Court on March 4, 1987 is LIFTED permanently.

SO ORDERED.
G.R. No. 92357 July 21, 1993

PHILIPPINE SCOUT VETERANS SECURITY AND INVESTIGATION AGENCY (PSVSIA), GVM

SECURITY AND INVESTIGATION AGENCY (GVM) and ABAQUIN SECURITY AND DETECTIVE
AGENCY, INC. (ASDA), petitioners,
vs.
THE HON. SECRETARY OF LABOR RUBEN D. TORRES AND PGA BROTHERHOOD
ASSOCIATION-UNION OF FILIPINO WORKERS, respondents.

V.E. Del Rosario & Associates for petitioners.

German N. Pascua, Jr. for private respondent.

NOCON, J.:

The sole issue presented for resolution in this petition for certiorari with prayer for preliminary
injunction is whether or not a single petition for certification election or for recognition as the sole and
exclusive bargaining agent can validly or legally be filed by a labor union in three (3) corporations
each of which has a separate and distinct legal personality instead of filing three (3) separate
petitions.

On April 6, 1989, private respondent labor union, PGA Brotherhood Association - Union of Filipino
Workers (UFW), hereinafter referred to as "the Union " filed a petition for Direct
Certification/Certification Election among the rank and file employees of Philippine Scout Veterans
Security and Investigation Agency (PSVSIA), GVM Security and Investigations Agency, Inc. (GVM).
and Abaquin Security and Detective Agency, Inc. (ASDA). These three agencies were collectively
referred to by private respondent Union as the "PGA Security Agency," which is actually the first
letters of the corporate names of the agencies.

On April 11, 1989, summons was issued to the management of PSVSIA, GVM, ASDA (PGA Security
Agency) at 82 E. Rodriquez Avenue, Quezon City.

On April 11, 26, 1986, petitioners filed a single comment alleging therein that the said three security
agencies have separate and distinct corporate personalities while PGA Security Agency is not a
business or corporate entity and does not possess any personality whatsoever; the petition was
unclear as to whether the rank-and-file employees mentioned therein refer to those of the three
security agencies collectively and if so, the labor union cannot seek a certification election in three
separate bargaining units in one petition; the labor union included in their organization "security
supervisors," in violation of R.A. 6715; and though R.A. 6715 is already in effect, there were still no
implementing rules therefor.

On May 4, 1989, the security agencies filed a Consolidated Motion to Dismiss on the grounds that
the 721 supporting signatures do not meet the 20% minimum requirement for certification election as
the number of employees totals 2374 and that there are no implementing rules yet of R.A. 6715.

On May 8, 1989, the Union filed an Omnibus Reply to Comment and Motion to Dismiss alleging that
it is clear that it is seeking a certification election in the three agencies; that the apparent separate
personalities of the three agencies were used merely to circumvent the prohibition in R.A. 5847, as
amended by P.D. 11 and P.D. 100, that a security agency must not have more than 1,000 guards in
its employ; that the three security agencies' administration, management and operations are so
intertwined that they can be deemed to be a single entity; and that the security supervisors cannot
be deemed part of management since they do not meet the definition of "supervisory employees"
found in Articles 212(m), Labor Code, as amended by Section 4, R.A. No. 6715.

On May 18, 1989, the security agencies filed a Rejoinder claiming that there is no violation of R.A.
5487, as amended by P.D. 11 and P.D. 100 since the three agencies were incorporated long before
the decrees' issuance; that mere duplication of incorporators does not prove that the three security
agencies are actually one single entity; and that security guard supervisors, most especially
detachment commanders, fall within the definition of the term "supervisors."

On July 6, 1989, Med-Arbiter Rasidali C. Abdullah issued an Order in favor of the labor union finding
that PSVSIA, GVM and ASDA should be deemed as a single entity and bargaining unit for the
purpose of union organizing and the holding of a certification election. The dispositive portion of the
Order reads as follows:

WHEREFORE, premises considered, let a certification election be conducted among

the rank and file security guards of PSVSIA, GVM and ASDA within twenty (20) days
from receipt hereof with the usual pre-election conference of the parties. The list of
eligible voters shall be based on the security agencies' payroll three (3) months prior
to the filing of this petition with the following choices:

a) PGA Brotherhood Association-Union of Filipino Workers (UFW); and

b) No union.

SO ORDERED.1

On July 21, 1989, the security agencies appealed the Med-Arbiter's Order to the Secretary of Labor
and Employment claiming that said Order was issued with grave abuse of discretion when it ruled
that the three security agencies could be considered as a single bargaining entity for purposes of the
holding of a certification election.

On December 15, 1989, the Labor Secretary Franklin M. Drilon denied the appeal for lack of merit
while at the same time affirming the Med-Arbiter's Order of July 6, 1989. He also ordered the
immediate conduct of a certification election. The dispositive portion of which reads as follows:

WHEREFORE, premises considered, the Appeal of respondents Security agencies is

hereby denied for lack of merit and the Order dated 6 July affirmed.

Let therefore, the pertinent records of this case be immediately forwarded to the
Regional Office for he immediate conduct of the certification election.

SO ORDERED. 2

On January 5, 1990, the three security agencies filed a Motion for Reconsideration arguing that they
were denied their rights to due process and that jurisdiction was not acquired over them by the labor
authorities.
On January 26, 1990, the succeeding Labor Secretary, Ruben D. Torres, likewise denied the Motion
for Reconsideration for lack of merit and reiterated the directive that a certification election be
conducted without further delay.

On March 14, 1990, the instant petition was filed by the three security agencies, raising the following
grounds:

SERIOUS ERRORS IN THE FINDINGS OF FACTS.

II

GRAVE ABUSE OF DISCRETION ON THE PART OF THE SECRETARY OF

LABOR. 3

Petitioners insist that there are three (3) corporations in this petition, each of which has a separate
and distinct corporate personality of its own with separate registrations with the Securities and
Exchange Commission (SEC) and different Articles of Incorporation and By-Laws; with separate sets
of corporate officers and directors; and no common business address except for GVM and ASDA
which are located at 1957 España corner Craig Streets, Sampaloc, Manila.

Petitioners claim that the facts and circumstances of the case of La Campana Coffee Factory, Inc. v.
Kaisahan Ng Mga Manggagawa sa La Campana 4 which public respondent claims to be on all fours
with the instant case, are very distinct from the facts and circumstance obtaining in the case at bar.
As to form of business organization, in theLa Campana case, only one of two (2) businesses was a
corporation i.e., the La Campana Coffee Factory, Inc. and the other, the La Campana Gaugau
Packing, is a "non-entity," being merely a business name. In the case at bar, all three (3) agencies
are incorporated. Moreover, the issue involved in the instant case is one of representation while in
the La Campana case, the issue involved is the validity of a demand for wage increases and other
labor standards benefits.

Petitioners likewise contend that it was error to hold that the three companies should be treated as
one in a single bargaining unit in one petition for certification elections resulting in a violation of the
right to due process of each corporation as no notice of hearing and other legal processes were
served on each of said corporations. Consequently, no jurisdiction was acquired on them by the
Department of Labor and Employment.

Petitioners' arguments deserve scant consideration. The facts and circumstances extant in the
record indicate that the Med-Arbiter and Secretaries Drilon and Torres were not mistaken in holding
that the three security companies are in reality a single business entity operating as a single
company called the "PGA Security Group" or "PGA Security Services Group." Factual findings of
labor officials are conclusive and binding on the Court when supported by substantial evidence. 5

The public repondent noted the following circumstances in the La Campana case similar to the case
at bar, as indicative of the fact that the La Campana Coffee Factory and La Campana Gaugau
Packing were in reality only one business with two trade names: (1) the two factories occupied the
same address, wherein they had their principal place of business; (2) their signboards,
advertisements, packages of starch, delivery truck and delivery forms all use one appellation, "La
Campana Starch and Coffee Factory"; (3) the workers in either company received their pay from a
single cashier, and (4) the workers in one company could easily transfer to the other company, and
vice-versa. This Court held therein that the veil of corporate fiction of the coffee factory may be
pierced to thwart the attempt to consider it part from the other business owned by the same family.
Thus, the fact that one of the businesses is not incorporated was not the decisive factor that led the
Court to consider the two factories as one. Moreover, we do not find any materiality in the fact that
the La Campana case was instituted to demand wage increases and other labor standards benefits
while this case was filed by the labor union to seek recognition as the sole bargaining agent in the
establishment. If businesses operating under one management are treated as one for bargaining
purposes, there is not much difference in treating such businesses also as one for the preliminary
purpose of labor organizing.

Indeed, the three agencies in the case at bar failed to rebut the fact that they are managed through
the Utilities Management Corporation with all of their employees drawing their salaries and wages
from said entity; that the agencies have common and interlocking incorporators and officers; and that
the PSVSIA, GVM and ASDA employees have a single Mutual Benefit System and followed a single
system of compulsory retirement.

No explanation was also given by petitioners why the security guards of one agency could easily
transfer from one agency to another and then back again by simply filling-up a common pro
forma slip called "Request for Transfer". Records also shows that the PSVSIA, GVM and ASDA
always hold joint yearly ceremonies such as the "PGA Annual Awards Ceremony". In emergencies,
all PSVSIA Detachment Commanders were instructed in a memorandum dated November 10, 1988
to get in touch with the officers not only of PSVSIA but also of GVM and ASDA. All of these goes to
show that the security agencies concerned do not exist and operate separately and distinctly from
each other with different corporate directions and goals. On the contrary, all the cross-linking of the
three agencies' command, control and communication systems indicate their unitary corporate
personality. Accordingly, the veil of corporate fiction of the three agencies should be lifted for the
purpose of allowing the employees of the three agencies to form a single labor union. As a single
bargaining unit, the employees therein need not file three separate petitions for certification election.
All of these could be covered in a single petition.

Petitioners' claim of alleged defect in the petition for certification election which although addressed
to the three security agencies merely alleged that there are only 1,000 employees when the total
number of employees in said security agencies is about 2,374 (PSVSIA - 1252; GVM - 807; and
ASDA - 315) thereby failing to comply with the legal requirement that at least twenty percent (20%)
of the employees in the bargaining unit must support the petition, betrays lack of knowledge of the
amendments introduced by R.A 6715 which became effective on March 21, 1989, prior to the filing
of the petition for certification election on April 6, 1989. Under the amendments, there is no need for
the labor union to prove that at least 20% of the security guards in the three agencies supported the
petition. When a duly organized union files a petition for certification election, the Med-Arbiter has
the duty to automatically conduct an election. He has no discretion on the matter. This is clearly the
mandate of Article 257 of the Labor Code, as amended by Section 24 of R.A. 6715, which now
reads:

Art. 257. Petitions in unorganized establishments. — In any establishment where

there is no certified bargaining agent, a certification election shall automatically be
conducted by the Med-Arbiter upon the filing of a petition by a legitimate labor
organization.

The designation of the three agencies collectively as "PGA Security Agency" and the service of
summons to the management thereof at 82 E. Rodriguez Avenue, Quezon City did not render the
petition defective. Labor Secretary Franklin Drilon correctly noted the fact that the affidavits executed
separately and under oath by the three managers of the three security agencies indicated their office
address to be at PSVSIA Center II, E. Rodriguez Sr. Blvd., Quezon City. Besides, even if there was
improper service of summons by the Med-Arbiter, the three (3) security agencies voluntarily
submitted themselves to the jurisdiction of the labor authorities. The summons were clearly sent to
and received by their lawyer who filed motions and pleadings on behalf of the three security
agencies and who always appeared as their legal counsel. It puzzles this Court why petitioners, who
claim to be separate entities, continue to be represented by one counsel even in this instant petition.

Finally, except where the employer has to file a petition for certification election pursuant to Article
258 of the Labor Code because of a request to bargain collectively, it has nothing to do with a
certification election which is the sole concern of the workers. Its role in a certification election has
aptly been described in Trade Unions of the Philippines and Allied Services (TUPAS) v. Trajano,6 as
that of a mere by-stander. It has no legal standing in a certification election as it cannot oppose the
petition or appeal the Med-Arbiter's orders related thereto. An employer that involves itself in a
certification election lends suspicion to the fact that it wants to create a company union.

This Court's disapprobation of management interference in certification elections is even more

forceful in Consolidated Farms, Inc. v. Noriel,7 where we held:

On a matter that should be the exclusive concern of labor, the choice of a collective
bargaining representative, the employer is definitely an intruder. His participation, to
say the least, deserves no encouragement. This Court should be the last agency to
lend support to such an attempt at interference with a purely internal affair of labor.

Indeed, the three security agencies should not even be adverse parties in the certification election
itself. We note with disapproval the title given to the petition for certification election of the Union by
the Med-Arbiter and the Secretary of Labor naming the three security agencies as respondents.
Such is clearly an error. While employers may rightfully be notified or informed of petitions of such
nature, they should not, however, be considered parties thereto with concomitant right to oppose it.
Sound policy dictates that they should maintain a strictly hands-off policy.

WHEREFORE, finding no reversible error in the questioned decision of the Secretary of Labor, the
instant petition for certiorari is hereby DISMISSED for utter lack of merit.

SO ORDERED.