VII.

Labor Relations Law

Week 10

A. Right to self-organization

The right to self-organization comprises of the right to form a union, workers' association
and labor management councils. Basically, this right is about unionism. After all, it is part of
the state policy to foster the free and voluntary organization of a strong and united labor
movement as well as to make sure that workers participate in policy and decision-making
processes affecting their rights, duties, and welfare (Samahan ng Manggagawa sa Hanjin
Shipyard v. Bureau of Labor Relations, G.R. No. 211145, October 14, 2015).

Extent of the Right to Self-Organization:

1. To form, join and assist labor organizations for the purpose of collective bargaining
through representatives of their own choosing and;
2. To engage in lawful concerted activities for the same purpose or for their mutual aid and
protection

1. Who may unionize for purposes of collective bargaining

The following are eligible to join labor organizations for mutual aid and protection:

- Ambulant / Mobile workers

- Intermittent workers
- Rural workers
- Workers without any definite employees
- Itinerant workers
- Self-employed people

Any national labor organization or labor federation or local union may file an application
for registration with the Bureau or the Regional Office where the applicant's principal office is
located (Book V, Rule II, Sec. 2, Implementing Rules).

Not all "managers" are disallowed from joining labor unions. There two type of
managers, the Top and Middle Managers and the "supervisors" or the First-Line Managers.
Top and Middle Managers have the authority to devise, implement and control strategic and
operational policies while the task of First-Line Managers is simply to ensure that such
policies are carried out by the rank-and- file employees of an organization (PICP v.
Laguesma, G.R. No. 101738, April 12, 2000). Because First-Line Managers do not really
perform managerial functions, they may be allowed to join labor unions.
a) Who cannot form, join or assist labor organizations

The following may not join labor unions:

1. Employees of international organizations with immunity

2. Members of the Armed Forces, the police, and even firemen
3. Managerial employees
4. Confidential employees

To qualify as confidential employee, one must (1) assist or act in a confidential capacity,
and (2) formulate, determine, and effectuate management policies in the field of labor
relations (San Miguel Supervisors v. Laguesma, G.R. No. 110399, August 15, 1997). These
two (2) criteria are cumulative, and both must be met if an employee is to be considered a
confidential employee (Tunay na Pagkakaisa v. Asia Brewery, G.R. No. 162025, August 3,
2010). Mere exposure to internal business operations of the company is not per se a ground
for the exclusion in the bargaining unit (Coca-Cola Bottlers v. Ilocos Professional and
Technical Employees Union, G.R. No. 193798, September 8, 2015). It must be noted that
the issue of determining if employees should be deemed confidential employees and be
excluded from the appropriate bargaining unit is a question of fact (Standard Chartered
Employees v. Standard Chartered, G.R. No. 161933, April 22, 2008).

5. High-level or managerial government employees

6. Aliens without valid working permits
7. Non-employees
8. Government employees, even those under GOCCs
9. Employees of cooperatives who are also members
10. Subversives or those engaged in subversive activities

2. Bargaining unit

Collective bargaining is a process where the parties agree to fix and administer terms
and conditions of employment which must not be below the minimum standards fixed by law,
and set a mechanism for resolving their grievances. A collective bargaining unit is a group of
employees of a given employer, comprised of all or less than all of the entire body of
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.

a) Test to determine the constituency of an appropriate bargaining unit

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. To wit, the following factors must be present for a collective
bargaining unit to be appropriate: (1) the will of the employees, (2) affinity and unity of the
employees’ interest, such as substantial similarity of work and duties, or similarity of
compensation and working conditions, (3) prior collective bargaining history, and (4)
similarity of employment status (International School Alliance v. Quisumbing, G.R. No.
128845, June 1, 2000).

An organization with a mixture of rank-and-file and supervisory employees cannot

possess any of the rights of a legitimate labor organization, including the right to file a
petition for certification election for the purpose of collective bargaining (Holy Child School v.
Sto. Thomas, G.R. No. 179146, July 23, 2013). It is only that after a labor organization has
been registered, it may exercise all the rights and privileges of a legitimate labor
organization. Any mingling between supervisory and rank-and-file employees in its
membership cannot affect its legitimacy for that is not among the grounds for cancellation of
its registration, unless such mingling was brought about by misrepresentation, false
statement or fraud under Article 239 of the Labor Code.

b) SEBA (Sole and Exclusive Bargaining Agent) Certification

SEBA Certification is the process whereby the DOLE recognizes a labor organization as
the exclusive bargaining representative of the employees in the appropriate bargaining unit.
Any legitimate labor organization may file a request for SEBA Certification in the Regional
Office in which issued its certificate of registration or certificate of creation of chartered local.
Upon issuance of the certification as SEBA, the certified union or local shall enjoy all the
rights and privileges of an exclusive bargaining agent of all the employees in the bargaining
unit.

c) Certification election

Certification election is the process, ordered and supervised by the DOLE, of

determining, through secret ballot, whether or not a majority of the employees wish to be
represented by a labor organization and, in the affirmative case, by which particular labor
organization. Any legitimate organization, including a national union or federation that has
issued a charter certificate to its local / chapter or the local / chapter itself, may file a petition
for certification election. In all cases, the employer shall not be considered a party thereto
with a concomitant right to oppose a petition for certification election.

A certified collective bargaining agreement may serve as a bar to certification elections.

A petition for certification election or a motion for intervention can only be entertained within
sixty days prior to the expiry date of an existing collective bargaining agreement. This means
that the rule prohibits the filing of a petition for certification election during the existence of a
collective bargaining agreement except within the freedom period, as it is called, when the
said agreement is about to expire (National Congress of Unions v. Trajano, G.R. No. L-
67485 April 10, 1992). This is to ensure stability in the relationships of the workers and the
management by preventing frequent modifications of any collective bargaining agreement
earlier entered into by them in good faith and for the stipulated original period.
 In certification elections, there can be a deadlock. There is a deadlock when there is a
complete blocking or stoppage resulting from the action of equal and opposed forces. The
word is synonymous with the word impasse, which presupposes reasonable effort at good
faith bargaining which, despite noble intentions, does not conclude in agreement between
the parties (Capitol Medical Center v. Laguesma, G.R. No. 118915, February 4, 1997).

No federation or national union shall be registered to engage in any organization activity

in more than one industry in any area or region, and no federation or national union shall be
registered to engage in any organizational activity in more than one industry all over the
country. In addition, federation or national union applicants must submit the following: (a)
proof of the affiliation of at least ten (10) locals or chapters, each of which must be a duly
recognized collective bargaining agent in the establishment or industry in which it operates,
supporting the registration of such applicant federation or national union; and (b) the names
and addresses of the companies where the locals or chapters operate and the list of all the
members in each company involved.

The exclusive bargaining representation status of a union in a CBA cannot go beyond

five years. The renegotiation and extension of the CBA does not bring with it the extension of
the exclusive bargaining status. Thus, the freedom period to file a petition for certification
election is reckoned from the expiration of the original five-year period, regardless of any
extension of the CBA (Picop Resources v. Dequilla, G.R. No. 172666, December 7, 2011).

The basic test for determining the appropriate bargaining unit is the application of a
standard whereby a unit is deemed appropriate if it affects a grouping of employees who
have substantial, mutual interests in wages, hours, working conditions, and other subjects of
collective bargaining (Erson Ang Lee v. Samahang Manggawa ng Super Lamination, G.R.
No. 193816, November 21, 2016). Geographical location can be completely disregarded if
the communal or mutual interests of the employees are not sacrificed.

Grounds for the dismissal or denial of the petition for certification election:

1. Petitioner is not listed in the department’s registry of legitimate labor unions.

2. Petition was lifted before or after the freedom period.
3. Petition was filed within 1 year from entry of voluntary recognition or a valid certification,
consent, or run-off election and no appeal on the results thereof is pending.
4. A duly certified union has commenced and sustained negotiations with the employer or
there exists a bargaining deadlock.
5. In case of an organized establishment, failure to submit the 25% support requirement.
6. Failure of local / chapter or national union / federation to submit a duly issued charter
certificate.
7. Absence of employer-employee relationships.
8. Non-appearance of the petitioner for 2 consecutive scheduled conferences before the
mediator-arbiter despite due notice.
 i. In an unorganized establishment

Certification election is mandatory on the part of the BLR upon the filing of a verified
petition by a legitimate labor organization including a national union or federation which has
already issued a charter certificate to its local chapter participating in the certification election
or a local chapter which has been issued a charter certificate by the national union or
federation. Certification election may also be mandatory upon the filing of a petition by the
employer when such employer is requested by a national union or federation, it shall not be
required to disclose the names of the local chapter’s officers and members.

The petition for certification election may be filed at any time but it is subject to the one-
election-per-year rule.

ii. In an organized establishment

Certification election is mandatory on the part of the BLR upon the filing of a verified
petition by a legitimate labor organization including a national union or federation which has
already issued a character certificate to its local chapter participating in the certification
election or a local chapter which has been issued a charter certificate by the national union
or federation, questioning the majority status of the incumbent bargaining agent within the
60-day freedom period before the expiration of a CBA. The petition must be supported by
the written consent of at least 25% of all employees in the appropriate bargaining unit. The
purpose of the 25% is to indicate that the petitioner has a fair chance of winning and the
petition is not just a nuisance.

The employer cannot file a petition for certification election for only a legitimate labor
organization, national union, or federation which has already issued a charter certificate to its
local chapter participating in the certification election or a local chapter which has been
issued a charter certificate by the national union or federation can file such petition.

When there is a CBA, the labor organization can file a petition for certification election
within the 60-day freedom period. When there is no CBA, then the labor organization can file
a petition for certification election at any time, subject to the deadlock bar rule.

d) Run-off election

Run-off election takes place between the unions who received the 2 highest number of
votes in a certification election with 3 or more choices, where not one of the unions obtained
the majority of the valid votes cast provided that the total union votes is at least 50% of the
votes cast.

i. Requirements
 For a run-off election to legitimately exist, the following are needed:

1. Valid election took place because majority of the Collective Bargaining Unit members
voted.
2. The total number of votes for the unions is at least 50% of the votes cast.
3. Not one of the choices obtained the majority of the valid votes cast.
4. There is no unresolved challenged votes or election protest which if sustained can
materially alter the results.
5. The said election presented at least 3 choices. There should be no "No Union" choice.
6. The two choices which garnered the highest number of votes will be declared the winner
provided they get the majority votes of the total votes cast.

In a certification election, all rank and file employees in the appropriate bargaining unit,
whether probationary or permanent are entitled to vote (National Union of Workers v. Labor
Secretary, G.R. No. 181531, July 31, 2009). Collective bargaining covers all aspects of the
employment relation and the resultant CBA negotiated by the certified union binds all
employees in the bargaining unit. Hence, all rank and file employees, probationary or
permanent, have a substantial interest in the selection of the bargaining representative.

e) Re-run election

Re-run election refers to an election conducted to break a tie between the contending
unions, including between “No Union” and one of the unions. It shall likewise refer to an
election conducted after a failure of election has been declared by the election officer and /
or affirmed by the mediator-arbiter.

Letters containing the signatures of those who were not able to vote are sufficient. They
indicate that the writers were not able to vote because they thought the election had been
postponed, especially given the fact that the two unions had pending appeals at the time
from orders denying them the right to intervene in the election (National Federation of Labor
v. Labor Secretary, G.R. No. 104556, March 9, 1998).

f) Consent election

Consent Election refers to the election voluntarily agreed upon by the parties to
determine the issue of majority representation of all the workers in the appropriate collective
bargaining unit. The difference between a consent election and a certification election is that
the conduct of a consent election is agreed upon by the parties to the petition while the
conduct of a certification election is ordered by the Med-Arbiter (Lepanto Consolidated
Mining v. Lepanato Capataz Union, G.R. No. 157086, February 18, 2013). If a group
withdrew its consent and opposed the conduct of the election, the petition necessarily
becomes one of a petition for certification election.
g) Affiliation and disaffiliation of the local union from the mother union

It is only the government, through DOLE, that can clothe a labor organization with a
legal personality to exercise the rights that are provided by the law. However, a duly
registered federation or national union may directly create a local chapter by issuing a
charter certificate indicating the establishment of the local chapter. The chapter shall acquire
legal personality only for purposes of filing a petition for certification election from the date it
was issued a charter certificate.

Whether there was a valid disaffiliation is a factual issue. A local labor union is a
separate and distinct unit primarily designed to secure and maintain an equality of
bargaining power between the employer and their employee-members. A local union does
not owe its existence to the federation with which it is affiliated. It is a separate and distinct
voluntary association owing its creation to the will of its members. The mere act of affiliation
does not divest the local union of its own personality, neither does it give the mother
federation the license to act independently of the local union. It only gives rise to a contract
of agency where the former acts in representation of the latter (National Union of Bank
Employees v. PEMA, G.R. No. 174287, August 12, 2013).

The purpose of affiliation by a local union with a mother union or a federation is to

increase by collective action the bargaining power in respect of the terms and conditions of
labor. Yet the locals remained the basic units of association, free to serve their own and the
common interest of all, subject to the restraints imposed by the Constitution and By-Laws of
the Association, and free also to renounce the affiliation for mutual welfare upon the terms
laid down in the agreement which brought it into existence.

Policy considerations dictate that in weighing the claims of a local union as against
those of a national federation, those of the former must be preferred. Parenthetically though,
the desires of the mother federation to protect its locals are not altogether to be shunned. It
will however be to err greatly against the Constitution if the desires of the federation would
be favored over those of its members. That, at any rate, is the policy of the law. For if it were
otherwise, instead of protection, there would be disregard and neglect of the lowly
workingmen (Philippine Skylanders v. NLRC, G.R. No. 127374, January 31, 2002).

i. Substitutionary doctrine

The Substitutionary Doctrine merely states that even during the effectivity of a collective
bargaining agreement executed between employer and employees thru their agent, the
employees can change said agent but the contract continues to bind them up to its
expiration date. They may bargain however for the shortening of said expiration date. The
doctrine cannot be invoked to support the contention that a newly certified collective
bargaining agent automatically assumes all the personal undertakings in the collective
bargaining agreement made by the deposed union (Benguet Consolidated v. BCI
Employees, G.R. No. L-24711, April 30, 1968).
h) Union dues and special assessments

Union dues refer to regular monthly contributions paid by the members to the union in
exchange for the benefits given to them by the CBA and to finance the activities of the union
in representing them. On the other hand, a special assessment is a levy upon a property on
the doctrine that the property against which it is levied derives some special benefit from the
improvement. It is not a tax measure intended to raise revenues for the Government.

i. Requirements for validity

1. There must be a written resolution.

2. The resolution must have been approved by a majority of all members.
3. The approval must be at a general membership meeting called for that purpose.
4. The secretary of the organization shall record the minutes of the meeting, which shall be
attested to by the president.

Substantial compliance with the above-mentioned procedure is not enough. The

requirements must be strictly complied with.

When so stipulated in a collective bargaining agreement or authorized in writing by the

employees concerned, the Labor Code and its Implementing Rules recognize it to be the
duty of the employer to deduct the sum equivalent to the amount of union dues, as agency
fees, from the employees’ wages for direct remittance to the union. The system is referred to
as check off. No requirement of written authorization from the non-union employees is
necessary if the non-union employees accept the benefits resulting from the CBA (Del Pilar
Academy v. Del Pilar Union, G.R. No. 170112, April 30, 2008).

It must be noted that the separation from a mother union removes the new union's right
to collect all union dues held in its trust. Upon existing as an independent labor organization
with a certificate of registration, the new union is no longer obliged to pay dues and
assessments to the mother union (National Union of Bank Employees v. PEMA, G.R. No.
174287, August 12, 2013).

i) Agency fees

Agency fees are dues equivalent to union dues charged from the non-union members
who or benefited by or under the CBA.

The obligation to pay union dues and agency fees obviously devolves not upon the
employer, but the individual employee (Holy Cross of Davao College v. Joaquin, G.R. No.
110007, October 18, 1996). It is a personal obligation not demandable from the employer
upon default or refusal of the employee to consent to a check-off. The only obligation of the
employer under a check-off is to effect the deductions and remit the collections to the union.
The employee’s acceptance of benefits resulting from a collective bargaining agreement
justifies the deduction of agency fees from his pay and the union’s entitlement thereto (Del
Pilar Academy v. Del Pilar Union, G.R. No. 170112, April 30, 2008). In this aspect, the legal
basis of the union’s right to agency fees is neither contractual nor statutory, but quasi-
contractual, deriving from the established principle that non-union employees may not
unjustly enrich themselves by benefiting from employment conditions negotiated by the
bargaining union.

i. Requisites for assessment

To impose agency fees, the following requisites must be present:

1. The employee is part of the bargaining unit.

2. He is not member of the union.
3. He partook of the benefits of the CBA.

Special assessments are approved by a written resolution voted by the majority of all
the members oat the meeting duly called for that purpose.