Digest: ACCFA v CUGCO

ACCFA – Agricultural Credit and Cooperative Financing Administration (ACCFA)

ACCFA - ACCFA Supervisors' Association (ASA) and the ACCFA Workers' Association
(AWA), ACCFA labor unions

CUGCO - Confederation of Unions in Government Corporations and Offices (CUGCO), the

mother union of ACCFA labor unions

Issue: Is ACA a government agency, and therefore its employees are not allowed to form unions
under RA 875?
Relevant law: RA 875 (1953)
Section 11. Prohibition Against Strikes in the Government. - The terms and conditions of
employment in the Government, including any political subdivision or instrumentality thereof,
are governed by law and it is declared to be the policy of this Act that employees therein shall
not strike for the purpose of securing changes or modification in their terms and conditions of
employment. Such employees may belong to any labor organization which does not impose the
obligation to strike or to join in strike: Provided, however, That this section shall apply only to
employees employed in governmental functions and not to those employed in proprietary
functions of the Government including but not limited to government corporations.

Facts:
Sep 1961 – A CBA was entered into by ACCFA labor unions and ACCFA, retroactively taking
effect on Jul 1, 1961
Oct 25, 1962 – Unions declared a strike, which ended on Nov. 26, 1962, when the workers
voluntarily returned to work.
Oct 30, 1962 – The ACCFA unions, together with its mother union, CUGCO, filed a complaint
with the Court of Industrial Relations vs. ACCFA for unfair labor practices
• violation of the CBA, discouraging union members to self-organize
• discrimination vs. union members in job promotions
• refusal to bargain
Mar 25, 1963 - CIR ruled in favor of CUGCO and ordered ACCFA to:
 ➢ Cease and desist from committing further acts that tent to discourage the members to self-
organize
➢ To comply with the CBA
➢ To bargain in good faith

Apr 25, 1963 – MFR filed by ACCFA turned down by CIR.

Aug 8, 1963 - Agricultural Land Reform Code, RA 3844, signed into law, which renamed
ACCFA to ACA. Under RA 3844, fund from the National Treasury provided to ACA.
During this time, the ACCFA vs. CUGCO case was pending.
Mar 17, 1964 – The ACCFA unions petitioned the CIR to certify them as the sole and exclusive
bargaining agent at ACA.
May 21, 1964 – Trial court certified the ACCFA unions as the sole and exclusive bargaining
agent at ACA.
Aug 24, 1964 – CIR affirmed trial court’s May 21, 1964 decision.

Oct 2, 1964 – ACA filed with the SC a petition for certiorari with urgent motion to stay the CIR
order of May 21, 1964 – that is, to NOT recognize the labor unions.
Oct 6, 1964 – SC dismissed ACA’s petition for “lack of adequate allegations.”
ACA appeals from the May 25, 1963 CIR order that ACA make good on the CBA and the May
21, 1964 certification of the labor unions as the sole and exclusive bargaining agent.
Doctrine: ACA reasoned that it is engaged in governmental, not proprietary functions – that is,
that it is a government agency as defined in RA 875, thus the CIR did not have jurisdiction to
grant the labor unions their petition to become the sole and exclusive bargaining agents. Under
RA 875, government employees MAY NOT form unions and engage in labor strikes.

SC ruling: ACA, based on RA 3844, performs governmental functions even though its main
function is one that is traditionally done by financial institutions. Some information that support
that ACA was a government agency:
✓ P150m was appropriated to it from the National Treasury for it to perform its
function of providing credit to farmers.
✓ ACA had the power to audit farmers’ coops, a power granted only to a
government agency.
Therefore, ACA workers MAY NOT form a union or engage in labor strikes.
The appeal from the May 25, 1963 CIR order had become moot. The May 21, 1964 certification
of the labor unions as the sole and exclusive bargaining agent was rejected.