Labor Review 2021

Atty. Paciano F. Fallar Jr.

SSCR-CoL

Bar Questions on

LABOR ORGANIZATIONS

and

CERTIFICATION ELECTION

Q1. A labor union lawyer opined that a labor organization is a private and voluntary
organization; hence, a union can deny membership to any and all applicants.

Is the opinion of counsel in accord with law?

ANSWER: As a general rule, the Labor Code provides that it shall be unlawful for any person to
restrain, coerce, discriminate against or unduly interfere with employees and workers in their
exercise of the right to self-organization. The exceptions to these are the following: (1) non-
employees; (2) subversives or those engaged in subversive activities; and, (3) religious objectors.
This means that employees have the right to join labor organizations and labor organizations
have no right to deny them membership provided they do not fall among those exempted.

Q2. A, an employee of XYZ Cooperative, owns 500 shares in the cooperative. He has
been asked to join the XYZ Cooperative Employees Association. He seeks your advice
on whether he can join the association. What advice will you give him?

ANSWER: I will advice him that he can join said association. Under jurisprudence,
Employee-Members of cooperatives cannot invoke the right to collective bargaining due
to the fact of ownership but they are allowed to form an association for their mutual aid
and protection as employees.

Q3 Do the following workers have the right to self- organization? Reasons/basis

(a). Employees of non-stock, non-profit organizations.

ANSWER: YES. Under the Labor Code, all persons employed in: Commercial, industrial,
agricultural enterprises, religious, charitable, medical or educational institutions, whether or not
operated for profit have the right to self-organization for the purpose of collective bargaining,
engaging in lawful concerted activities for collective bargaining, and mutual aid and protection

(b). Alien employees

ANSWER: YES. Under jurisprudence, aliens may have the right to self-organization provided
the following requisites concur: (1) they have valid working permits issued by DOLE; and (2)
they are nationals of a country which grants similar rights to Filipinos as certified by the DFA or
ratified the ILO.

Q4 How does the government employees’ right to self-organization differ from that of the
employees in the private sector?

ANSWER: Under the Labor Code, employees of government corporations established under the
Corporation Code shall have the right to organize and to bargain collectively with their
respective employers. All other employees of the civil service shall have the right to form
associations for purposes not contrary to law. Whereas employees in the private sector have the
unbridled discretion to exercise the right to self-organization.

1
Q5. A, B, C and D (treasurer, accountant, elementary department Principal, and secretary of the
Director, respectively), regular employees of a private educational institution, were
administratively charged for their participation in a picket held in front of the campus after office
hours. Several faculty members, non-academic staff and students joined the peaceful prayer rally
organized by disgruntled employees to protest certain alleged abuses of the incumbent School
Director. Subsequently, the rank-and-file employees succeeded in forming the first and only
union of the School.

During the investigation, the administration discovered that two (2) days prior to the rally, A, B,
C and D attended the meeting of the School’s employees’ association which planned the protest
activity. Two well-known organizers/leaders of a national labor federation were also present.

A, B, C and D were dismissed by the School on the ground of violating the Labor Code which
prohibits managerial employees to “join, assist or form any labor organization." Is the contention
of the School tenable? Is the dismissal of A, B, C, and D Valid? Explain?

ANSWER: YES. As a general rule, high-level employees whose functions are normally
considered as policy-making or managerial or whose duties are of a highly confidential nature. In
order to consider one as a managerial or supervisory employee they must have a discretion in
directing affairs of the employment, they must act independently, and their recommendations
must be given particular weight. They are considered supervisory employees if they can
effectively recommend to the manager or employer for the interest of the employer if the
exercise of such authority is not merely routinary or clerical in nature but requires independent
judgment. Jurisprudence further provides that confidential employees are likewise disqualified.
To be considered confidential employees, an employee must assist or act in a confidential
capacity and obtain confidential information relating to labor relations policies.

In this case, a treasurer and an accountant are supervisory employees because of the weight of
their decisions with regard to the interest of the employer and they themselves can exercise
discretion in such recommendations. An elementary department principal is a managerial
position by nature because they have the power to fire or retain certain employees and they may
exercise independent judgment thereon. Finally, the secretary of the director is a type of
employment that is confidential in nature because his functions relates to the labor relations of
their employees.

Thus, the four of them may be effectively dismissed.

Q6 Do workers have a right not to join a labor organization?

ANSWER: YES. Jurisprudence provides that the right to join labor organizations also carries
with it the right not to join labor organizations.

Q7 On what ground or grounds may a union member be expelled from the organization?

ANSWER: A union member may be expelled from the organization by violations of the union
security clause and by other unfair labor practices committed by the employee.

Q8.Mang Bally, owner of a shoe repair shop with only nine (9) workers in his establishment,
received proposals for collective bargaining from the Bally Shoe Union. Mang Bally refused to
bargain with the workers for several reasons. First, his shoe business is just a service
establishment. Second, his workers are paid on a piecework basis (i.e., per shoe repaired) and not
on a time basis. Third, he has less than ten (10) employees in the establishment. Which reason or
reasons is/are tenable? Explain briefly.

ANSWER: None of the grounds are tenable. The right to self-organization covers all persons
employed in private commercial, industrial and agricultural enterprises and in religious,
charitable, medical, or educational Institutions whether operating for profit or not Mode of
payment and number of employees have no relevance to the right to self organization.

2
Q9. The union deducted P20.00 from Rogelio's wages for January. Upon inquiry he learned that
it was for death aid benefits and that the deduction was made pursuant to a board resolution of
the directors of the union. Can Rogelio object to the deduction? Explain briefly.

ANSWER: Yes. In order that the special assessment (death aid benefit in this case ) may be
upheld as valid, there must also be individual written authorization for the check-off.

Q10. Arty. Facundo Veloso was retained by Welga Labor Union to represent it in the collective
bargaining negotiations. It was agreed that Atty. Veloso would be paid in the sum of
P200,000.00 as attorney's fees for his assistance in the CBA negotiations.

After the conclusion of the negotiations. Welga Labor Union collected from its individual
members the sum of P500.00 each to pay for Atty. Veloso's fees and another sum of P500 each
for services rendered by the union officers. Several members of the Welga Labor Union
approached you to seek advice on the following matters.

a) Whether or not the collection of the amount assessed on the individual members to
answer for the Attorney's fees was valid.

ANSWER: The assessment of P500.00 from each union member as professional fees for union
negotiation is not valid. Art. 228(b) of the Labor Code prohibits such exaction from individual
union members. However, such negotiation fees could be sourced from union funds.

b) Whether or not the assessment of Pl00 from the individual members of the Welga Labor
Union for services rendered by the union officers in the CBA negotiations was valid.

Answer: It is also not valid, for the same reason as above. These "negotiation fees" to
the non-lawyer union officers cannot also n be charged against union funds, since they
do not constitute "attorney's fees"

Q11 Polaris Drug Company had an existing Collective Bargaining Agreement with Polaris
Workers Union (PWU) which was due to expire on 31 May 2010. PWU had a total membership
of 100 rank-and-file employees of the company. Mike Barela, a militant member of the union,
suspected that the union officers were misappropriating union funds as no financial report was
given to the general membership during the union's general assembly. Hence, Mike Barela
prepared a sworn written complaint and filed the same with the Office of the Secretary of Labor
on 10 May 2010], petitioning for an examination of the financial records of PWU. He attached
to his petition the signatures of 25 union members.

(a) Is the Secretary of Labor authorized by law to examine the financial records of the
union? If so, what power? If not, why not?

ANSWER: Yes. The Secretary of Labor is expressly authorized under his visitorial power to
examine the financial records of the unions to determine compliance or non-compliance with the
pertinent provisions of the Labor Code and to prosecute any violation of the law and the union
constitution-and- by-laws This authority may be exercised only upon the filing of a complaint
under oath and duly supported by the written consent of at least twenty percent (20%) of the
total membership of the labor organization concern

(b) Given the facts above, could an examination or audit of the financial records of the
union be ordered? Why?

ANSWER: No. While the complaint is under oath and supported by written consent of at least
twenty (20%) per cent of the total union membership ,the Labor Code provides that an
examination of the books of a union shall not be conducted during the sixty (60) day
freedom period (Art. 289, Labor Code) . In the case, the complaint was filed on 10 May 2010

3
which is within the freedom period of the current CBA set to expire on 31 May 2010.

Q12. Are probationary employees entitled to vote in a certification election among rank and file
employees? Why of why not?

ANSWER: Yes. Any employee, whether employed for a definite period or not, shall, beginning
on his first day of service, be considered an employee for purposes of membership in any labor
union. All rank- and-file employees, probationary or permanent, belong to the same bargaining
unit inasmuch as they have a community of interest.

Q13 Can an employer legally oppose the inclusion of confidential employees in the bargaining
unit of rank-and-file employees or of supervisory employees ?

ANSWER: Yes. The bystander rule does not prohibit an employer from asserting its legitimate
interest that it must only deal with the representative of the appropriate bargaining unit.

Jurisprudence holds that confidential employees are ineligible to join, assist, or form any labor
organization. By the nature of their functions, they 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. Allowing them to join union would expose the company to serious
disadvantage, and would not be fair.

Q14 Jenson & Jenson (J & J) is a domestic corporation engaged in the manufacturing of consumer products.
Its rank-and-file workers organized the Jenson Employees Union (JEU), a duty registered local union affiliated
with PAFLU, a national union. After having been certified as the exclusive bargaining agent of the appropriate
bargaining unit, JEU-PAFLU submitted its proposals for a Collective Bargaining Agreement with the
company.

In the meantime, a power struggle occurred within the national union PAFLU between its National President,
Manny Pakyao, and its National Secretary General, Gabriel Miro. The representation issue within PAFLU is
pending resolution before the Office of the Secretary of Labor.

By reason of this intra-union dispute within PAFLU, J & J obstinately and consistently refused to offer any
counterproposal and to bargain collectively with JEU-PAFLU until the representation issue within PAFLU
shall have been resolved with finality. JEU-PAFLU filed a Notice of Strike. The Secretary of Labor
subsequently assumed jurisdiction over the labor dispute.

Will the representation issue that has arisen involving the national union PAFLU, to which the duty registered
local union JEU is affiliated, bar collective bargaining negotiation with J & J? Explain briefly.

ANSWER: No. It is the local union JEU that is the collective bargaining agent and has the right to
bargain with the employer J and J, and not the national union PAFLU. The internal issue at
PAFLU has no bearing on the local union's right to collective bargaining.

Q15 In a certification election conducted by the Department of Labor, Associated Workers

Organization in Laguna (AWOL) headed by Cesar Montanyo, won over Pangkat ng mga
Manggagawa sa Laguna (PML), headed by Eddie Graciaa. Hence, AWOL was certified as the
exclusive bargaining agent of the rank-and-file employees of the Laguna Transportation
Company (LTC).

Shortly, thereafter, a Collective Bargaining Agreement was concluded by LTC and AWOL
which provided for a closed shop. Consequently, AWOL, demanded that Eddie Graciaa and all
the PML members be required to become members of AWOL as a condition for their continued
employment: otherwise, they shall be dismissed pursuant to the closed shop provision of the
CBA.

Can Eddie Graciaa and all the PML members be required to become members of the AWOL
pursuant to the closed shop provision of the CBA? Why?

ANSWER: No. A closed shop provision cannot be applied to those employees who are already
members of another union at the time of the signing of the CBA.

4
Q16 A group of employees in XYZ Factory belonging to a religious sect, in conformity with the
teachings and dictates of their religion, refused to join the labor union in the factory. The labor
union was able to negotiate a substantial wage increase in its collective bargaining agreement
with management. A provision therein stated that the wage increase would be paid to the
members of the union only in view of a "closed shop" union security clause in the new
agreement. The members of the sect protested and demanded that the wage increase be extended
to them. The officers of the union countered by demanding their termination from the company
pursuant to the "closed shop" provision in the just-concluded CBA.

(a) Is the CBA provision valid?

ANSWER: No, the CBA provision is not valid. The benefits of a CBA are extendible to all
employees in the bargaining unit. To withhold the same from non-union members would be an
act of unlawful discrimination.

(b) Should the company comply with the union's demand of terminating the
members of the religious sect?

ANSWER: No. The constitutional freedom to worship is preferred over the right to compel
union membership though a union security clause.

Q 1 7 Company XYZ has two recognized labor unions, one for its rank-and-file
employees (RFLU), and one for supervisory employees (SELU). Of late, the company
instituted a restructuring program by virtue of which A, a rank-and-file employee and
officer of RFLU, was promoted to a supervisory position along with four (4) other
colleagues, also active union members and/or officers. Labor Union KMJ, a rival labor
union seeking recognition as the rank-and-file bargaining agent, filed a petition for the
cancellation of the registration of RFLU on the ground that A and her colleagues have
remained to be members of RFLU. Is the petition meritorious? Explain.

ANSWER: No, the petition is not meritorious. The inclusion as union members of
employees outside the bargaining unit is not a ground for the cancellation of the
registration of the union. However, the said employees are automatically deemed
removed from the list of membership of said union.

Q18. A is employed by XYZ Company where XYZ Employees Union (XYZ-EU) is the
recognized exclusive bargaining agent. Although A is a member of rival union XYR-MU,
he receives the benefits under the CBA that XYZ-EU had negotiated with the company.

XYZ-EU assessed A agency fee equivalent to the dues paid by its members but A
insists that he has no obligation to pay said dues because he is not a member of XYZ–
EU and he has not issued an authorization to allow the collection. Explain whether his
claim is meritorious.

ANSWER: A’s claim is meritorious. Since he is already a member of another union

when the CBA with the union security clause was signed, he is not subject to both the
union security clause and agency fees.

Q19 Rank-and-file workers from Peacock Feathers, a company with 120 employees,
registered their independent labor organization with the Department of Labor and
Employment (DOLE) Regional Office. Management countered with a petition to cancel
the union’s registration on the ground that the minutes of ratification of the union
constitution and by-laws submitted to the DOLE were fraudulent. Specifically,
management presented affidavits of ten (10) out of forty (40) individuals named in the
list of union members who participated in the ratification, alleging that they were not
present at the supposed January 1, 2010 meeting held for the purpose. The union
argued that the stated date of the meeting should have read “January 11, 2010,” instead
of “January 1, 2010,” and that, at any rate, the other thirty (30) union members were
enough to register a union. Decide with reason.

ANSWER: The Petition for Cancellation should be dismissed.

5
The Supreme Court has held that discrepancies in the figures contained in the
various supporting documents are not indication of fraud or misrepresentation
especially when the discrepancies could be explained. The discrepancies may also
be irrelevant when the 20% membership requirement has been met.

Here, the date specified is explained as mere typographical error as admitted by the
union itself. Moreover, the union is correct in arguing that the 30 union members are
enough to uphold the registration of the union despite the retraction of the 10 union
members.

Q20 Llanas Corporation and Union X, the certified bargaining agent of its employees,
concluded a CBA for the period January 1, 2000 to December 31, 2004. But, long
before the CBA expired, members of Union Y, the minority union, showed
dissatisfaction with the CBA under the belief that Union X was a company union.
Agitated by its members, Union Y filed a Petition for a Certification Election (PCE) on
December 1, 2002. Will the petition prosper?

ANSWER: Assuming that the CBA was registered, the PCE will not. Under the contract
bar rule, no certification election shall be conducted outside of the 60-day "freedom
period" of the 5-year term of the CBA.

Q21 A group of 15 regular rank-and-file employees of Bay Resort formed and registered
an independent union. On hearing of this, the management called the officers to check
who the union members were. It turned out that the members included the probationary
staff, casuals, and the employees of the landscape contractor. The management
contends that inclusion of non-regulars and employees of a contractor makes the
union’s composition inappropriate and its registration invalid. Is this correct?

ANSWER: No, the management is not correct. The inclusion as union members of
employees outside the bargaining unit is not a ground for the cancellation of the
registration of the union. However, the said employees are automatically deemed
removed from the list of membership of said union.

Q22 The Securities and Exchange Commission approved a merger that allowed Broad
Bank to absorb the assets and liabilities of EBank. Broad Bank also absorbed EBank’s
rank-and-file employees without change in tenure, salary, and benefits. Broad Bank was
unionized but EBank was not. The Broad Bank bargaining union requested the
management to implement the union security clause in their CBA by requiring the ex-
EBank employees to join the union. Does the union security clause in the Broad Bank
CBA bind the ex-EBank employees?

ANSWER: Yes, the union security clause is binding on the employees absorbed by the
Broad Bank because of the merger. The employees of EBank are now employees of
Broad Bank. If the said employees are members of the bargaining unit, the CBA
between their new employer and the union will apply to them.

Q23 During the CBA negotiation the management panel proposed a redefinition of the
“rank-and-file” bargaining unit to exclude “HR Specialist” in the human resource
department and “Analyst” in the research and development department. The union
panel objected since those affected have already been included in the bargaining unit
covered by the existing CBA and so could no longer be excluded. Is the union correct in
insisting that their exclusion would amount to bad faith on the part of the management
panel?

ANSWER: No, the union is not correct. The mere proposal of redefinition does not
amount to bad faith on the part of the management panel. The union is free to accept or
reject the same.

6
Q24 Pablo works as a driver at the National Tire Company (NTC). He is a member of
the Malayang Samahan ng Manggagawa sa NTC, the exclusive rank-and-file collective
bargaining representative in the company. The union has a CBA with NTC which
contains a union security and a check-off clause. The union security clause contains a
maintenance of membership provision that requires all members of the bargaining unit
to maintain their membership in good standing with the union during the term of the
CBA under pain of dismissal. The check-off clause on the other hand authorizes the
company to deduct from union members' salaries defined amounts of union dues and
other fees. Pablo refused to issue an authorization to the company for the check-off of
his dues, maintaining that he will personally remit his dues to the union.

(a) Would the NTC management commit unfair labor practice if it desists from
checking off Pablo's union dues for lack of individual authorization from Pablo?

ANSWER: No. There is no union interference by the management. Its inability to comply
with the request for check off is predicated on a valid ground, the refusal of the
employee to give authorization as required by law.

c) Can the union charge Pablo with disloyalty for refusing to allow the check off of
his union dues and, on this basis, demand the company to dismiss him from
employment?

ANSWER: No. The obligation of Pablo is to pay his union dues, but he is not required to
consent to check off/salary deduction. He could pay directly to the union. Only if he
refuses to pay despite demands that the union have ground to expel him. The grounds
and procedures would depend on the union's constitution and by-laws.

Q25 SamahangTunay, a union of rank-and-file employees lost in a certification election

at Solam Company and has become a minority union. The majority union now has a
signed CBA with the company and the agreement contains a maintenance of
membership clause.

Which acts can Samahang Tunay still legally do as a minority union?

(a) It can still represent these members in grievance committee meetings.

(b) It can collect agency fees from its members within the bargaining unit.
(c) It can still demand meetings with the company on company time.
(d) as a legitimate labor organization, it can continue to represent its members on non-
CBA-related matters.

ANSWER: (d) Samahang Tunay can continue to represent its members on matters not
related to collective bargaining such as for the purposes of mutual help and protection
of its members. It may also continue to represent its members in a labor suit against its
employer (e.g. , illegal dismissal or ULP ). It also retains the right to strike, but only on
ground of ULP. It cannot strike on ground of bargaining deadlock, since it does not
administer the CBA and does not have the right to demand negotiations.

PFFALLARJRNOV2021