FEATI UNIVERSITY v.
BAUTISTA and FEATI Industrial Peace Act is applicable to educational
UNIVERSITY FACULTY CLUB
Facts:
The President of Feati University Faculty Club wrote a
letter to Victoria L. Araneta, President of petitioner Feati
University informing her of the organization of the
Faculty Club into a registered labor union. The Faculty
Club is composed of members who are professors
and/or instructors of the University. They then sent
another letter containing twenty-six demands that have
connection with the employment of the members of the
Faculty Club by the University, and requesting an
answer within ten days from receipt thereof. The
President of the University answered the two letters,
requesting that she be given at least thirty days to study
thoroughly the different phases of the demands.
Meanwhile counsel for the University, to whom the
demands were referred, wrote a letter to the President of
the Faculty Club demanding proof of its majority status
and designation as a bargaining representative. The
President of the Faculty Club replied by rejecting
Araneta's request for extension of time, and on the same
day he filed a notice of strike with the Bureau of Labor
alleging as reason the refusal of the University to
bargain collectively.
The parties were called to conferences at the
Conciliation Division of the Bureau of Labor but efforts to
conciliate them failed. A month later the members of the
Faculty Club declared a strike and established picket
lines in the premises of the University, resulting in the
disruption of classes in the University. Despite further
efforts of the officials from the Department of Labor to
effect a settlement of the differences between the
management of the University and the striking faculty
members no satisfactory agreement was arrived at. The
President of the Philippines certified to the Court of
Industrial Relations the dispute between the
management of the University and the Faculty Club
pursuant to the provisions of Section 10 of Republic Act
No. 875 (The Industrial Peace Act).
Issues:
WON CIR has jurisdiction over the parties even if the
University is an educational institution. YES
It is contended by the University that because it is an
educational institution and not an industrial
establishment, the CIR cannot take cognizance of the
case. The faculty members are also alleged to be
independent contractors rather than employees. But in
jurisprudence, the SC said that when it does not allow
CIR to take on cases of supposed unfair labor practice, it
is because the institutions involved are entities are not
organized, maintained and operated for profit and do not
declare dividends to stockholders. In short, the Act does
not apply to educational institutions that are not operated
or maintained for profit and do not declare dividends.
But Feati University is an educational institution which is
found to be making profits and declaring dividends. It is
not strictly for educational purposes and that realizes
profits and parts of such earning is distributed as
dividends to private stockholders or individuals. The
institutions that are organized, operated and maintained
for profit. Hence, CIR has jurisdiction. It a settled
doctrine that the Industrial Peace Act is applicable to any
organization or entity — whatever may be its purpose
when it was created — that is operated for profit or gain.
WON the University is an employer within the
contemplation of the law. YES
The University claims that it is not an employer within the
contemplation of Republic Act No. 875, because it is not
an industrial establishment. At most, it says, it is only a
lessee of the services of its professors and/or instructors
pursuant to a contract of services entered into between
them. But as defined by the Act, the term employer
includes any person acting in the interest of an
employer, directly or indirectly, but shall not include any
labor organization (otherwise than when acting as an
employer) or any one acting in the capacity or agent of
such labor organization. In using the word "includes" and
not "means", Congress did not intend to give a complete
definition of "employer", but rather that such definition
should be complementary to what is commonly
understood as employer.
Congress intended the term to be understood in a broad
meaning because, firstly, the statutory definition includes
not only "a principal employer but also a person acting in
the interest of the employer"; and, secondly, the Act itself
specifically enumerated those who are not included in
the term "employer", namely: (1) a labor organization
(otherwise than when acting as an employer), (2)
anyone acting in the capacity of officer or agent of such
labor organization [Sec. 2(c)], and (3) the Government
and any political subdivision or instrumentality thereof
insofar as the right to strike for the purpose of securing
changes or modifications in the terms and conditions of
employment is concerned (Section 11). Among these
statutory exemptions, educational institutions are not
included; hence, they can be included in the term
"employer" (provided, the same is considered covered
by the first issue).
Employer encompasses those that are in ordinary
parlance "employers." What is commonly meant by
"employer"? The term "employer" has been given
several acceptations. The Court, in the cases of the The
Angat River Irrigation System, et al. vs. Angat River
Workers' Union (PLUM), which cases involve unfair labor
practices and defined the term employer as one who
employs the services of others; one for whom
employees work and who pays their wages or salaries. It
is also any person acting in the interest of an employer,
directly or indirectly.
Under none of the above definitions may the University
be excluded, especially so if it is considered that every
professor, instructor or teacher in the teaching staff of
the University, as per allegation of the University itself,
has a contract with the latter for teaching services, albeit
for one semester only. The University engaged the
services of the professors, provided them work, and paid
them compensation or salary for their services. Even if
the University may be considered as a lessee of services
under a contract between it and the members of its
Faculty, still it is included in the term "employer".
"Running through the word `employ' is the thought that
there has been an agreement on the part of one person
to perform a certain service in return for compensation to
be paid by an employer. When you ask how a man is
employed, or what is his employment, the thought that
he is under agreement to perform some service or
services for another is predominant and paramount."
The contention of the University that the professors
and/or instructors are independent contractors, because
the University does not exercise control over their work,
is likewise untenable. This Court takes judicial notice
that a university controls the work of the members of its
faculty; that a university prescribes the courses or
subjects that professors teach, and when and where to
teach; that the professors' work is characterized by
regularity and continuity for a fixed duration; that
professors are compensated for their services by wages
and salaries, rather than by profits; that the professors
and/or instructors cannot substitute others to do their
work without the consent of the university; and that the
professors can be laid off if their work is found not
satisfactory. All these indicate that the university has
control over their work; and professors are, therefore,
employees and not independent contractors.
WON the Faculty Club can be unionized and can exist
as a valid labor organization. YES
The record shows that the Faculty Club is a duly
registered labor organization and this fact is admitted by
counsel for the University.
NYK INTERNATIONAL KNITWEAR CORPORATION
PHILIPPINES and/or CATHY NG v. NLRC and
VIRGINIA M. PUBLICO
Facts:
In 1995, NYK hired respondent Virginia Publico as a
sewer. Under the terms and conditions of her
employment, Publico was paid on a piece-rate basis, but
required to work from 8:00 A.M. to 12:00 midnight. On
the average, she earned P185.00 daily. At about 10:00
P.M. of May 7, 1997, Publico requested that she be
allowed to leave the work place early, as she was not
feeling well due to a bout of influenza. Permission was
refused but nonetheless, Publico went home. The
following day, Publico called up her employer and
notified management that she was still recovering from
her ailment.
On May 9, 1997, Publico reported for work. To her
mortification and surprise, however, the security guard
prevented her from entering the NYK premises, allegedly
on management’s order. She begged to be allowed
inside, but the guard remained adamant. It was only
when Publico declared that she would just complete the
unfinished work she had left on May 7 that the guard let
her in. Once inside the factory, Publico requested to see
the owner, one Stephen Ng. Her request was declined.
She was instead asked to come back the following day.
On May 10, 1997, Publico returned to NYK as instructed.
After waiting for three and half (3½) hours, she was
finally able to see Stephen Ng. When she inquired why
she was barred from reporting for work, Mr. Ng told her
she was dismissed due to her refusal to render overtime
service. Publico then filed a case for illegal dismissal.
Version of NYK? Allegedly, they took the pains to verify
why Publico did not report for work on May 7, 1997 and
found out that her husband did not allow her to work at
night. As night work is a must in their line of business,
particularly when there are rush orders, petitioners
claimed that given Publico’s failure to render overtime
work, they were left with no other recourse but to fire
her.
Issue: WON there was illegal dismissal. YES
NYK contend that Publico’s refusal to render night work
is tantamount to abandonment of duties which
constitutes a just ground for termination of service.
The bare allegations of abandonment cannot stand. This
has been proven by the facts. NYK’s assertion that they
cannot be solidarily liable with Ng in this case as there
was no malice or bad faith on their part has no leg to
stand on too. In A.C. Ransom Labor Union-CCLU v.
NLRC it was held that since a corporation is an artificial
person, it must have an officer who can be presumed to
be the employer, being the “person acting in the interest
of the employer.” In other words the corporation, in the
technical sense only, is the employer. In jurisprudence it
has been established that the corporate officers of the
employer corporation are to pay jointly and solidarily the
private respondents’ monetary award, especially when
illegal dismissal is involved.
Cathy Ng, admittedly, is the manager of NYK. She falls
within the meaning of an “employer” as contemplated by
the Labor Code, who may be held jointly and severally
liable for the obligations of the corporation to its
dismissed employees. In her capacity as manager and
responsible officer of NYK, cannot be exonerated from
her joint and several liability in the payment of monetary
award to Publico.
ALLIED v. CIA MARITIMA
Under Article 212 of the Labor Code, as amended, the
term “Employer” includes any person acting in the
interest of an employer, directly or indirectly. It shall not
include any labor organization or any of its officers or
agents except when acting as an employer. On the other
hand, an employee is any person in the employ of the
employer. The term shall not be limited to the employees
of a particular employer, unless the Labor Code so
explicitly states. It shall include any individual whose
work has ceased as a result of or in connection with any
current labor dispute or because of any unfair labor
practice provided he has not obtained any other
substantially equivalent and regular employment.
The said definition of “employer” excludes labor
organization or its officers or agents as employer.
However, they shall be considered as employer with
respect to persons who render services to them as their
employees. (Feati University vs. Bautista, 18 SCRA
1191). A labor organization which has substituting
contracts with shipping companies for arrastre and
stevedoring services with organizational structure,
systems operational facilities akin to independent
contractors, is considered an employer insofar as its
laborers under its hire are concerned.
PRODUCERS BANK OF THE PHILIPPINES v. NLRC
FACTS:
Producers Bank was placed by the Central Bank under a
conservator for the purpose of protecting its assets.
When the private respondents sought the
implementation of the CBA regarding the retirement plan
and uniform allowance, the acting conservator of the
petitioner expressed her objection to such plan, resulting
in an impasse between the petitioner bank and the
private respondent union. The deadlock continued for at
least six months when the private respondent, to resolve
the issue, decided to file a case against the petitioner for
unfair labor practice and for flagrant violation of the CBA
provisions. LA dismissed private respondent's complaint.
NLRC reversed LA and ordered the petitioner to
implement the provisions of the CBA which were
disallowed by the conservator.
RATIO:
While the Central Bank law gives vast and far-reaching
powers to the conservator of a bank, it must be pointed
out that such powers must be related to the
"(preservation of) the assets of the bank, (the
reorganization of) the management thereof and (the
restoration of) its viability." It cannot extend to the post-
facto repudiation of perfected transactions, otherwise
they would infringe against the non-impairment clause of
the Constitution. The conservator merely takes the place
of a bank's board of directors. What the board cannot do
— such as repudiating a contract validly entered into
under the doctrine of implied authority — the conservator
cannot do either.
A conservator cannot rescind a valid and existing
contract and that the CBA is the law between the
contracting parties, it is obvious that the conservator had
no authority whatsoever to disallow the implementation
of Article XI, Section 1 and Article X, Section 4 of the
CBA, especially considering that the ideals of social
justice and protection of labor are guaranteed not only
by the Labor Code, but more importantly by the
fundamental law of the land. When the conflicting
interests of labor and capital are weighed on the scales
of social justice, the dominant influence of the latter must
be counter-balanced by the sympathy and compassion
the law must accord the under-privileged worker.
Granting that both the Labor Arbiter and the NLRC
indeed had no jurisdiction over the issue, petitioner
cannot anymore plead such procedural flaw under the
principle of estoppel. It was only when the decision of the
NLRC was unfavorable that it raised the issue of
jurisdiction. While jurisdiction may be assailed at any
stage, a party's active participation in the proceedings
before a court without jurisdiction will estop such party
from assailing such lack of it.
Finally, petitioner asserts since the employees have
retired, as a consequence of which no employee-
employer relationship exists anymore between it and the
employees, private respondent no longer had the
personality to file the complaint for them.
Retirement results from a voluntary agreement between
the employer and the employee whereby the latter after
reaching a certain age agrees to sever his employment
with the former. The very essence of retirement is the
termination of the employer-employee relationship.
The retirement of an employee does not, in itself, affect
his employment status especially when it involves all
rights and benefits due to him, since these must be
protected as though there had been no interruption of
service. It must be borne in mind that the retirement
scheme was part of the employment package and the
benefits to be derived therefrom constituted, as it were, a
continuing consideration for services rendered, as well
as an effective inducement for remaining with the
corporation. It is intended to help the employee enjoy the
remaining years of his life, releasing him from the burden
of worrying for his financial support, and are a form of
reward for his loyalty.
When the retired employees were requesting that their
retirement benefits be granted, they were not pleading
for generosity but were merely demanding that their
rights, as embodied in the CBA, be recognized. Thus,
when an employee has retired but his benefits under the
law or the CBA have not yet been given, he still retains,
for the purpose of prosecuting his claims, the status of
an employee entitled to the protection of the Labor
Code, one of which is the protection of the labor union.
PAL v. PALEA
FACTS:
PAL dismissed four employees (Fortuno Biangco,
Hernando Guevarra, Bernardino Abarrientos) who are
members of PALEA — and the CIR en banc passed
resolution, directing the reinstatement of said employees
"to their former or equivalent position in the company,
with back wages from the date of their reinstatement,
and without prejudice to their seniority or other rights and
privileges. This was affirmed by SC.
Said employees were reinstated and PALEA moved for
the execution of the CIR resolution as regards the "other
rights and privileges" therein mentioned, referring, more
specifically to: (1) Christmas bonus from 1950 to 1958;
(2) accumulated sick leave; (3) transportation allowance
during lay-off period; and (4) accumulated free trip
passes, both domestic and international. CIR granted
this motion.
RATIO:
In ordering therein the "reinstatement" of said employees
with "back wages from the date of their dismissal to the
date of their reinstatement, and without prejudice to their
seniority or other rights and privileges," it is obvious that
the resolution intended to restore the employees to their
status immediately prior to their dismissal. Hence, it
directed not only their reinstatement, but, also, the
payment of their back wages during the period of their
lay-off — thus referring necessarily to a period of time
preceding their reinstatement — and the retention of
"their seniority or other rights and privileges" –at the time
of their aforementioned dismissal. In other words, the
reinstatement was with back wages for the lay-off period,
coupled with "seniority or other rights and privileges",
attached to the status of the employees when they were
dismissed. To put it differently, the CIR treated said
employees as if they had not been absent from work and
had been uninterruptedly working during the lay-off
period.
Republic Steel Corporation vs. NLRB held that, under a
decree of the CCA and Order of the NLRB directing the
employer to reinstate the striking employees without
prejudice to their seniority or other rights or privileges, it
was the intention of the Board and Court to provide that,
upon reinstatement the employees were to be treated in
matters involving seniority and continuity of employment
as though they had not been absent from work, and
hence the reinstated employees were entitled to the
benefits of the employer's vacation plan for the year in
which they were reinstated and subsequent years upon
the basis of continuity of service computed as though
they had been actually at during the entire period from
the date of strike to the date of reinstatement.
The employees involved in the case at bar are entitled to
the Christmas bonus that PAL had given to all of its
employees during said period, for said bonus, having
been paid regularly, has become part of the
compensation of the employees. Said employees are,
likewise, entitled to transportation allowance and the
corresponding sick leave privileges. These sick leave
privileges are subject, however, to the following
qualifications, namely: (1) that the accumulated sick
leave cannot exceed 140 days, pursuant to the collective
bargaining agreement between the PAL and the PALEA,
effective in 1959; and (2) that, pursuant to the same
agreement, which denies sick leave privileges to retired
employees, Onofre Griño and Bernardino Abarrientos,
who have retired, are not entitled to said privileges.
The PAL's appeal as regards the free trip passes is,
however, well taken, for the employees had no absolute
right thereto, even if they had actually rendered services
during the lay-off period. The free trip passes were
given, neither automatically, nor indiscriminately. The
employees had to apply therefore and their applications
were subject PAL's approval.
AIR LINE PILOTS ASSOCIATION OF THE
PHILIPPINES (GASTON GROUP), CIR and ALAP
(GOMEZ GROUP)
L-33705: Air Line Pilots Association of the Philippines
(Gaston group) maintains that the CIR acted without
jurisdiction in passing upon (1) the question of which, in
a certification proceeding, between the set of officers
elected by the group of PAL pilots headed by Captain
Felix Gaston, on the one hand, and the set of officers
elected by the group headed by Captain Ben Hur
Gomez, on the other, is the duly elected set of officers of
the Air Line Pilots Association of the Philippines, and (2)
the question of which, between the two groups, is
entitled to the name, office and funds of the said
Association.
L-35206: Individual petitioners (numbering 127) and the
ALAP (Gaston) maintain that the CIR acted without
jurisdiction and with grave abuse of discretion in
promulgating its resolution dated June 19, 1972 which
suspended the hearing of the said petitioners' plea below
for reinstatement and/or return to work in the PAL or,
alternatively, the payment of their retirement and/or
separation pay, as the case may be, until this Court,
shall have decided L-33705.
Antecedent Facts (in chronological order):
There was a labor dispute between members of ALPAP
and PAL and a strike ensued. CIR issued a return to
work order which was complied by the workers, except
Felix C. Gaston who allegedly refused to take the flights
assigned to him; thereafter PAL terminated Gaston's
services.
A general ALPAP meeting was held and the members
adopted a resolution amending its constitution and by-
laws by providing in a new section thereof that — Any
active member who shall be forced to retire or forced to
resign or otherwise terminated for union activities as
solely determine' by the Association shall have the
option to either continue to be and remain as an active
member in good standing or to resign in writing his
active membership with the Association.
CIR issued an order commanding ALPAP members not
to strike or in any way cause any stoppage in the
operation and service of PAL and for PAL not to lockout
any of such members and officers of ALPAP. BUT
despite the order, a substantial majority of ALPAP
members filed letters of retirement/resignation from the
PAL.(These are the individual petitioners praying for
reinstatement in L-35206)
An election of ALPAP officers was held and resulted in
Felix C. Gaston as President by 180 votes. The next
day, about 45 pilots who did not tender their retirement
or resignation the PAL gathered and elected Ben Hur
Gomez as ALPAP President. (So they have 2 presidents
–note that the new section provides that members who
have resigned are considered still members of the union)
ALPAP, represented by Ben Hur Gomez, claiming to be
its President, filed a petition with the CIR praying for
certification as the sole and exclusive collective
bargaining representative of "all the pilots now under
employment by the Philippine Air Lines, Inc, and are on
active flight and/or operational assignments." The
petition which was opposed in the name of the same
association by Felix C. Gaston (who also claimed to be
its President) on the ground that the CIR has no
jurisdiction over the subject-matter o" the petition
"because a certification proceeding in the Court of
Industrial Relations is not the proper forum for the
adjudication of the question as to who is the lawful
president of a legitimate labor organization."
CIR certified ALPAP (Gomez Group), as the sole and
exclusive Bargaining representative of all the pilots
employed by PAL and are on active flights and/or
operational assignments, and as such is entitled to all
the rights and privileges of a legitimate labor
organization, including the right to its office and its union
funds.
RATIO:
A certification proceeding is not a litigation but an
investigation of a non-adversary, fact finding character in
which the Court of Industrial Relations plays the part of a
disinterested investigator seeking merely to ascertain the
desires of employees as to the matter of their
representation. Such being the nature of a certification
proceeding, we find no cogent reason that should
prevent the industrial court, in such a proceeding, from
inquiring into and satisfying itself about matters which
may be relevant and crucial though seemingly beyond
the purview of such a proceeding, to the complete
realization of the well-known purposes of a certification
case.
Such a situation may arise, as it did in the case at bar,
where a group of pilots of a particular airline, allegedly
anticipation their forced retirement or resignation on
account of strained relations with the airline arising from
unfulfilled economic demands, decided to adopt an
amendment to their organization's constitution and by-
laws in order to enable them to retain their membership
standing therein even after the termination of their
employment with the employer concerned. The industrial
court definitely should be allowed ample discretion to
secure a disclosure of circumstances which will enable it
to act fairly in a certification case.
SC cannot likewise subscribe to the restrictive
interpretation made by the court below of the term "labor
organization," which Section 2(e) of R.A. 875 defines as
any union or association of employees which exist,
in whole or in part, for the purpose of the collective
bargaining or dealing with employers concerning
terms and conditions of employment." The absence
of the condition which the court below would attach to
the statutory concept of a labor organization, as being
limited to the employees of particular employer, is quite
evident from the law. The emphasis of Industrial Peace
Act is clearly on the purposes for which a union or
association of employees established rather than that
membership therein should be limited only to the
employees of a particular employer. Trite to say, under
Section 2(h) of R.A 875 "representative" is defined as
including "a legitimate labor organization or any
officer or agent of such organization, whether or not
employed by the employer or employee whom he
represents." It cannot be overemphasized likewise that
labor dispute can exist "regardless of whether the
disputants stand in the proximate relation of employer
and employee. (Section 2(j), R.a. 875).
The fundamental assumptions relied upon by the CIR as
bases for authorizing ALPAP (Gomez) to take over the
office and funds of ALPAP is erroneous and the Court
cannot hold as valid and binding the election of Ben Hur
Gomez as President of ALPAP. He was elected at a
meeting of only 45 ALPAP members called just one day
after the election of Felix C. Gaston as President of
ALPAP who, as shown, received a majority of 180 votes
out of a total membership of 270.
It is perfectly within the powers and prerogatives of a
labor organization, through its duly elected officers, to
authorize a segment of that organization to bargain
collectively with a particular employer, particularly where
those constituting the segment share a common and
distinguishable interest, apart from the rest of their fellow
union members, on matters that directly affect the terms
and conditions of their particular employment. As the
circumstances pertinent to the case at bar presently
stand, ALPAP (Gaston) has extended recognition to
ALPAP (Gomez) to enter and conclude collective
bargaining contracts with PAL. Having given ALPAP
(Gomez) this authority, it would be clearly unreasonable
on the part of ALPAP (Gaston) to disallow the former a
certain use of the office, funds and name of ALPAP
when such use is necessary or would be required to
enable ALPAP (Gomez) to exercise, in a proper manner,
its delegated authority to bargain collectively with PAL.
L-35206: W/N CIR acted without jurisdiction and with
grave abuse of discretion in promulgating the
resolution suspending hearings on the mentioned
petition for reinstatement until this Court shall have
decided L-33705. NO
The matter of the reinstatement of the pilots who retired
or resigned from PAL was ventilated fully and
adequately in the certification case in all its substantive
aspects, including the allegation of the herein petitioners
that they were merely led to believe in good faith that in
retiring or resigning from PAL they were simply
exercising their rights to engage in concerted activity. In
the light of the circumstances thus found below it can be
safely concluded that the mass retirement and
resignation action of the herein petitioners was
intentionally planned to abort the effects of the return-to-
work orders of the industrial court by placing themselves
beyond the jurisdictional control of the said court through
the umbrella of the constitutional, prohibition against
involuntary servitude, thereby enabling them to pursue
their main pressure objective of grounding most, if not
all, PAL flight operations.
Contrary to ALPAP (Gaston)'s argument that the pilots'
retirement' resignation was a legitimate concerted
activity , citing Section 2(1) of the Industrial Peace Act
which defines "strike" as "any temporary stoppage of
work by the concerted action of employees as a result of
an industrial dispute," it is worthwhile to observe that as
the law defines it, a strike means only a "temporary
stoppage of work." What the mentioned pilots did,
however, cannot be considered, in the opinion of this
Court, as mere "temporary stoppage of work." What they
contemplated was evidently a permanent cut-off of
employment relationship with their erstwhile employer,
PAL. In any event, the dispute below having been
certified as existing in an industry indispensable to the
national interest, the said pilots' rank disregard for the
compulsory orders of the industrial court and their daring
and calculating venture to disengage themselves from
that court's jurisdiction, for the obvious purpose of
satisfying their narrow economic demands to the
prejudice of the public interest, are evident badges of
bad faith.
CEBU SEAMEN’s ASSn INC. v. CALLEJA
212 SCRA 50 (1992)
Facts: In 1950, a group of deck officers and marine
engineers on board vessels plying Cebu and other ports
of the Philippines organized themselves into an
association and registered the same as a non-stock
corporation known as Cebu Seamen's Association, Inc.
(CSAI), with the Securities and Exchange Commission
(SEC). Later on, the same group registered its
association with this Bureau as a labor union known as
the Seamen's Association of the Philippines,
Incorporated (SAPI).
SAPI has an existing collective bargaining agreement
(CBA) with the Aboitiz Shipping Corporation which will
expire on 31 December 1988. In consonance with the
CBA said company has been remitting checked-off union
dues to said union until 1987 when a group composed of
members of said union, introducing itself to be its new
set of officers, went to the company and claimed that
they are entitled to the remittance and custody of such
union dues. This group, headed by Manuel Gabayoyo
claims that they were elected as such on January 20,
1987 under the supervision of the SEC.
Subsequently, another group headed by Dominica C.
Nacua, claiming as the duly elected set of officers of the
union in an election held on 20 December 1986, filed a
complaint, for and in behalf of the union, against the
Cebu Seamen's Association, Inc. (CSAI) as represented
by Manuel Gabayoyo for the security of the
aforementioned CBA, seeking such relief, among others,
as an order restraining the respondent from acting on
behalf of the union and directing the Aboitiz Shipping
Corp. to remit the checked-off union dues for the months
of March and April 1987.
CSAI filed its Answer/Position Paper alleging that the
complainant union and CSAI are one and the same
union; that Dominica C. Nacua and Atty. Prospero
Paradilla who represented the union had been expelled
as members/officers as of November 1984 for lawful
causes; and, that its set of officers headed by Manuel
Gabayoyo has the lawful right to the remittance and
custody of the corporate funds.
Issue: Who is entitled to the collection and custody of
the union dues – (1) Cebu Seamen’s Association
headed by Gabayoyo or Seamen’s Association of the
Philippines headed by Nacua
Held: It is the set of officers headed by Dominica C.
Nacua that is the lawful set of officers of SAPI and
therefore, is entitled to the release and custody of the
union dues as well as the agency fees, if any, there be.
A record check with the Labor Organizations (LOD), this
Bureau, shows that SAPI has submitted to it for file the
list of this new set of officers, in compliance with the
second paragraph of Article 242 (c) of the Labor Code.
This list sufficiently sustains the view that said officers
were lawfully elected, in the absence of clear and
convincing proof to the contrary. On the other hand, the
group of Gabayoyo is the set of officers of the
respondent corporation and not of the complainant
union.
Public respondent Bureau of Labor Relations correctly
ruled on the basis of the evidence presented by the
parties that SAPI, the legitimate labor union, registered
with its office, is not the same association as CSAI, the
corporation, insofar as their rights under the Labor Code
are concerned. The expulsion of Nacua from the
corporation, of which she denied being a member, has
however, not affected her membership with the labor
union. In fact, in the elections of officers for 1987-1989,
she was re-elected as the president of the labor union.
Thus there is no merit in the the contention of Gabayoyo
that Nacua was already expelled from the union.
Whatever acts their group had done in the corporation
do not bind the labor union. Moreover, Gabayoyo cannot
claim leadership of the labor group by virtue of his
having been elected as a president of the dormant
corporation CSAI.
Nestle Phils. Inc. v. NLRC
195 SCRA 340 (1991)
Facts: Eugenia Nunez, Liza Villanueva, Emmanuel
Villena, Rudolph Armas, Rodolfo Kua and Rodolfo
Solidum were either employed as sales or medical
representatives of Nestle Philippines. Said employees
availed availed of the company’s car loan policy. Nunez,
Villena, Villanueva and Armas were dismissed for having
participated in an illegal strike. Kua and Solidum were
dismissed for certain irregularities. Said employees filed
complaints for illegal dismissal in the Arbitration Branch
of the NLRC. The Labor Arbiter dismissed their
complaints and upheld their dismissal. They appealed to
the NRLC where their appeals are pending. Meanwhile,
the company filed a civil suit to recover possession of
the cars subject of the car loan policy, after the
dismissed employees failed and refused to either settle
the remaining balance of the cost of their respective
cars, or to return them to the company for proper
disposition. The dismissed employees sought a
temporary restraining order in the NLRC to stop the
company from cancelling their car loans and collecting
their monthly amortication pending the final resolution of
their appeals in the illegal dismissal case. The NLRC en
banc granted the petition for injunction. The company
filed a petition for certiorari, alleging that the NLRC does
not have jurisdiction over the issue in the absence of any
labor dispute related to the same. The petition was
granted by the Supreme Court, annulling the NLRC
resolution in the petition for injunction.
Issue: WON there is labor dispute arising or related to
the issue involving the car loan policy so as to provide
the NLRC jurisdiction over the petition for injunction.
Held: NO, Nestlé's demand for payment of the private
respondents' amortizations on their car loans, or, in the
alternative, the return of the cars to the company, is not
a labor, but a civil, dispute. It involves debtor-creditor
relations, rather than employee-employer relations. It is
not dependent on or related to any labor aspect under
which a labor injunction can be issued. Whether or not
the private respondents remain as employees of the
petitioner, there is no escape from their obligation to pay
their outstanding accountabilities to the petitioner; and if
they cannot afford it, to return the cars assigned to them.
As noted, the options given to the private respondents
are civil in nature arising from contractual obligations.
There is no labor aspect involved in the enforcement of
those obligations.
Thus, the NLRC gravely abused its discretion and
exceeded its jurisdiction by issuing the writ of injunction
to stop the company from enforcing the civil obligation of
the private respondents under the car loan agreements
and from protecting its interest in the cars which, by the
terms of those agreements, belong to it (the company)
until their purchase price shall have been fully paid by
the employee. The terms of the car loan agreements are
not in issue in the labor case. The rights and obligations
of the parties under those contracts may be enforced by
a separate civil action in the regular courts, not in the
NLRC.
 
San Miguel Corp. Employees Union v. Bersamira
Facts: Contracts for merchandising service were
entered into by San Miguel corp. (SMC) with
independent contractors duly licensed by the DOLE
namely Lipercon and D’Rite. The two contractors and
SMC agreed that the workers employed by the
contractors were to be paid by the contractors and that
none of them were to be deemed employees or agents
of SMC. However, SMC was advised by SMC
Employees Union on November 20, 1988 that Lipercon
and D’Rite workers signed up for union membership. It
was the union’s argument that the said group of
employees, while appearing to be contracted workers of
independent contractors, they continuously worked for
SMC for 6 months to 15 years and that their work was
neither casual nor seasonal as they performed work or
activities necessary or desirable in the usual business or
trade of SMC. The Union further argued that the “labor
only” contracting situation and that the employment
status of these workers shall be regularized. Upon
petition for injunction and damage filed by SMC, the
RTC issued an order enjoining the union from
representing the Lipercon and D’Rite workers for the
purpose of collective bargaining. The union sought to
nullify the said writ on the ground that the controversy
involved a labor dispute which was beyond the lower
court’s jurisdiction.
Issue: WON there exists a labor dispute between SMC
and the union which makes the case under the
jurisdiction of the labor tribunal.
Held: YES, while it is San Miguel’s submission that no
employer-employee relationship exists between itself, on
one hand, and the contractual workers of Lipercon and
D’Rite, on the other hand, a labor dispute can
nevertheless exist “regardless of whether the disputants
stand in the proximate relationship of employer and
employee (Article 212(i), Labor Code),” provided the
controversy concerns, among others, the terms and
conditions of employment or a “change” or arrangement”
thereof. The existence of a labor dispute is not negated
by the fact that the plaintiffs and the defendants do not
stand in the proximate relationship of employee. A labor
dispute, as defined by law, does exists herein, and is
evident. What the union seeks is to regularize the status
of the employees contracted by the Lipercon and D’Rite,
was in effect that they be absorbed into the working unit
of SMC. This matter definitely dwells on the working
relationship between said employees vis-à-vis SMC.
Terms, tenure and conditions of the employment and the
arrangement of those terms are involved, bringing the
matter within the purview of labor dispute.
KIOK LOY v. NLRC
FACTS:
On November 29, 1978, the Bureau of Labor Relations
issued a resolution declaring the Pambansang Kilusang
Paggawa as the sole and exclusive bargaining agent of
the rank-and-file employees of Sweden Ice Cream Plant.
The company’s motion for reconsideration of the said
resolution was denied on January 25, 1978.
Accordingly, on December 7, 1978, the Union furnished
the Company with two copies of its proposed collective
bargaining agreement. It also requested the Company
for its counter proposals. Both requests were ignored.
The company failed to respond.
With these, on February 14, 1979, the Union filed a
"Notice of Strike", with the Bureau of Labor Relations on
the ground of unresolved economic issues in collective
bargaining. Conciliation proceedings then followed
during the thirty-day statutory cooling-off period.
However, all attempts for an amicable settlement failed.
The Bureau of Labor Relations then certified the case to
the National Labor Relations Commission for
compulsory arbitration.
The labor arbiter set the initial hearing for April 29, 1979.
For failure however, of the parties to submit their
respective position papers as required, the said hearing
was cancelled and reset to another date. The Union
consequently submitted its position paper.
On July 20, 1979, the National Labor Relations
Commission rendered its decision declaring the
respondent guilty of unjustified refusal to bargain
The company then filed a petition before the court
alleging that the National Labor Relations Commission
acted without or in excess of its jurisdiction or with grave
abuse of discretion amounting to lack of jurisdiction in
rendering the challenged decision. It further alleged that
the decision is not supported by law.
ISSUE: Whether the company may be held guilty of
unjustified refusal to bargain - YES
RATIO:
The Court held that collective bargaining, which is
defined as negotiations towards a collective agreement,
is one of the democratic frameworks under the New
Labor Code, designed to stabilize the relation between
labor and management and to create a climate of sound
and stable industrial peace. It is a mutual responsibility
of the employer and the Union and is characterized as a
legal obligation. So much so that Article 249, par. (g) of
the Labor Code makes it an unfair labor practice for an
employer to refuse “to meet and convene promptly and
expeditiously in good faith for the purpose of negotiating
an agreement with respect to wages, hours of work, and
all other terms and conditions of employment including
proposals for adjusting any grievance or question arising
under such an agreement and executing a contract
incorporating such agreement, if requested by either
party.”
While it is a mutual obligation of the parties to bargain,
the employer, however, is not under any legal duty to
initiate contract negotiation. The mechanics of collective
bargaining is set in motion only when the following
jurisdictional preconditions are present, namely:
1. Possession of the status of majority
representation of the employees’
representative in accordance with any of
the means of selection or designation
provided for by the Labor Code;
2. Proof of majority
3. Representation; and
4. A demand to bargain under Article 251, par.
(a) of the New Labor Code
All of which preconditions are undisputedly present in
the instant case.
From the over-all conduct of petitioner company in
relation to the task of negotiation, there can be no doubt
that the Union has a valid cause to complain against the
company’s attitude, the totality of which is indicative of
the latter’s disregard of, and failure to live up to, what is
enjoined by the Labor Code — to bargain in good faith.
MANILA DIAMOND HOTEL EMPLOYEES UNION v.
Court of Appeals
FACTS:
On November 11, 1996, the petitioner Union filed a
petition for a certification election so that it may be
declared the exclusive bargaining representative of the
Hotel’s employees for the purpose of collective
bargaining. This was dismissed by the Department of
Labor and employment due to la of legal requirements.
After a few months or on August 25, 1997, the Union
sent a letter to the Hotel informing it of its desire to
negotiate for a collective bargaining agreement. This
was rejected by the Hotel management through a letter
written by the Hotel’s Human Resources Department
Manager, Mary Anne Mangalindan, because of the
dismissal of the Union’s petition before the DOLE. The
Union contended that they were not giving the Hotel a
notice to bargain. They were merely asking for the Hotel
to engage in collective bargaining negotiations with the
Union for its members only and not for all the rank and
file employees of the Hotel. The company, however, did
not respond favorably.
With these, a Notice of Strike was filed on September
29, 1997, with the National Conciliation and Mediation
Board (NCMB) alleging the Hotel’s refusal to bargain
and unfair labor practices as grounds.  The NCMB
summoned both parties and held a series of dialogues.
On November 29, 1997, however, the Union staged a
strike against the Hotel.
The Secretary of DOLE, Cresenciano B. Trajano,
assumed jurisdiction and ordered compulsory arbitration
pursuant to Article 263 (g) of the Labor Code. The Union
members were directed to return to work and for the
HOTEL to accept them back. The Hotel refused to
accept the employees’ return. Consequently, the order
was modified by the Acting Secretary of Labor Jose M.
Español such that reinstatement was to be done only in
the payroll.
The Union then filed a petition for certiorari alleging
grave abuse of discretion on the part of the Labor
Secretary for ordering payroll reinstatement. The case
was referred to the Court of Appeals, which affirmed the
order.
ISSUE: Whether the Court of Appeals committed grave
abuse of discretion in affirming the validity of “payroll
reinstatement” of the Union members. - Yes
RATIO:
The Court first distinguished the case from UST v. NLRC
relied upon by the Court of Appeals. Accordingly, the
UST case was decided in light of the fact that the order
of payroll reinstatement was issued when the teachers
could not be given back their academic assignments
because the semester was already halfway.
Then, the Court held that in order to answer the issue
presented, there must be reference to the nature of
Article 263(g).  As a general rule, the State encourages
an environment wherein employers and employees
themselves must deal with their problems in a manner
that mutually suits them best.  This is the basic policy
embodied in Article XIII, Section 3 of the Constitution,
which was further echoed in Article 211 of the Labor
Code. Hence, a voluntary, instead of compulsory, mode
of dispute settlement is the general rule.
However, Article 263, paragraph (g) of the Labor Code,
which allows the Secretary of Labor to assume
jurisdiction over a labor dispute involving an industry
indispensable to the national interest, provides an
exception:
(g)  When, in his opinion, there exists a labor dispute
causing or likely to cause a strike or lockout in an
industry indispensable to the national interest, the
Secretary of Labor and Employment may assume
jurisdiction over the dispute and decide it or certify the
same to the Commission for compulsory arbitration. 
Such assumption or certification shall have the effect of
automatically enjoining the intended or impending strike
or lockout as specified in the assumption or certification
order.  If one has already taken place at the time of
assumption or certification, all striking or locked out
employees shall immediately return to work and the
employer shall immediately resume operations and
readmit all workers under the same terms and conditions
prevailing before the strike or lockout.
This provision is viewed as an exercise of the police
power of the State, preventing prolonged strike or
lockout, which is inimical to the national economy and,
therefore, the situation is imbued with public necessity
and involves the right of the State and the public to self-
protection.
Under Article 263(g), all workers must immediately
return to work and all employers must readmit all of them
under the same terms and conditions prevailing before
the strike or lockout.  The Court pointed out that the law
uses the precise phrase of “under the same terms and
conditions,” revealing that it contemplates only actual
reinstatement.  This is in keeping with the rationale that
any work stoppage or slowdown in that particular
industry can be inimical to the national economy.  It was
an error on the part of the Court of Appeals to view the
assumption order of the Secretary as a measure to
protect the striking workers from any retaliatory action
from the Hotel. The Court reiterates that the law was
written as a means to be used by the State to protect
itself from an emergency or crisis. It is not for labor, nor
is it for management.
VICTORIA v. INCIONG
FACTS:
The petitioner Saturno Victoria was employed on March
17, 1956 by private respondent Far East Broadcasting
Company, Incorporated as a radio transmitter operator.
He and his co-workers organized, sometime in July
1971, the Far East Broadcasting Company Employees
Association with him as President. After registering their
association with the then Department of Labor, they
demanded recognition of said association by the
company but the latter refused on the ground that being
a non-profit, non-stock, non-commercial and religious
corporation, it is not covered by Republic Act 875,
otherwise known as the Industrial Peace Act, the labor
law enforced at that time. They were further advised of
the impossibility of compelling recognition by the Director
of Labor Relations during several conciliation meetings.
Notwithstanding such advice, the union members led by
Saturno Victoria, declared a strike and picketed the
company's premises on September 6, 1972 for the
purpose of seeking recognition of the labor union. The
strike was consequently declared illegal and the workers
were ordered to return to work while the civil case for
damages was pending. The company then dismissed
Victoria, which was declared illegal by the NLRC due to
violation of article 267 of the Labor Code, requiring
clearance from the Secretary of Labor for every
shutdown of business establishments or dismissal of
employees. This was reversed by Sec. Inciong, ruling
that mere report of the termination of the services of said
petitioner was sufficient.
ISSUE: Whether there should be clearance under Art.
267 before the petitioner may be dismissed - NO
RATIO:
The Court held that the purpose in requiring a prior
clearance from the Secretary of Labor in cases of
shutdown or dismissal of employees is to afford the
Secretary ample opportunity to examine and determine
the reasonableness of the request. The rationale behind
the clearance requirement was fully met in this case.
The Secretary of Labor was apprised of private
respondent's intention to terminate the services of
petitioner. This in effect is an application for clearance to
dismiss petitioner from employment. Consequently,
private respondent acted in good faith when it terminated
the employment of petitioner upon a declaration of
illegality of the strike.
Further, it held that the case is a matter of responsibility
and of answerability. Petitioner as a union leader must
see to it that the policies and activities of the union in the
conduct of labor relations are within the precepts of law
and any deviation from the legal boundaries shall be
imputable to the leader. He bears the responsibility of
guiding the union along the path of law and to cause the
union to demand what is not legally demandable, would
foment anarchy which is a prelude to chaos.
As a strike is an economic weapon at war with the
policy of the Constitution and the law at that time, a
resort thereto by laborers shall be deemed to be a
choice of remedy peculiarly their own and outside of the
statute, and as such, the strikers must accept all the
risks attendant upon their choice. If they succeed and
the employer succumbs, the law will not stand in their
way in the enjoyment of the lawful fruits of their victory.
But if they fail, they cannot thereafter invoke the
protection of the law for the consequences of their
conduct unless the right they wished vindicated is one
which the law will, by all means, protect and enforce.
UST Faculty Union v. Bitonio
Facts:
Petitioner is assailing respondent’s ruling declaring the
election of officers of the union void for having been
conducted in violation of the union’s Constitution and
Bylaws (CBL). Bitonio rejected petitioners’ contention
that it was a legitimate exercise of their right to self-
organization.  He ruled that the CBL, which constituted
the covenant between the union and its members, could
not be suspended during the October 4, 1996 general
assembly of all faculty members, since that assembly
had not been convened or authorized by the USTFU.
Issue: W/N Bitonio committed grave abuse of discretion
– NO
Ratio/Doctrine:
Right to self-organization
Self-organization is a fundamental right guaranteed by
the Philippine Constitution and the Labor Code. 
Employees have the right to form, join or assist
labor organizations for the purpose of collective
bargaining or for their mutual aid and protection.
Whether employed for a definite period or not, any
employee shall be considered as such, beginning on his
first day of service, for purposes of membership in a
labor union.
Corollary to this right is the prerogative not to join,
affiliate with or assist a labor union. Therefore, to
become a union member, an employee must, as a rule,
not only signify the intent to become one, but also take
some positive steps to realize that intent.  The procedure
for union membership is usually embodied in the union’s
constitution and bylaws. An employee who becomes a
union member acquires the rights and the concomitant
obligations that go with this new status and becomes
bound by the union’s rules and regulations.
“When a man joins a labor union (or almost any other
democratically controlled group), necessarily a portion of
his individual freedom is surrendered for the benefit of all
members.  He accepts the will of the majority of the
members in order that he may derive the advantages to
be gained from the concerted action of all.  Just as the
enactments of the legislature bind all of us, to the
constitution and by-laws of the union (unless contrary to
good morals or public policy, or otherwise illegal), which
are duly enacted through democratic processes, bind all
of the members.  If a member of a union dislikes the
provisions of the by-laws, he may seek to have them
amended or may withdraw from the union; otherwise, he
must abide by them.  It is not the function of courts to
decide the wisdom or propriety of legitimate by-laws of a
trade union.
“On joining a labor union, the constitution and by-laws
become a part of the member’s contract of membership
under which he agrees to become bound by the
constitution and governing rules of the union so far as it
is not inconsistent with controlling principles of law.  The
constitution and by-laws of an unincorporated trade
union express the terms of a contract, which define the
privileges and rights secured to, and duties assumed by,
those who have become members.  The agreement of a
member on joining a union to abide by its laws and
comply with the will of the lawfully constituted majority
does not require a member to submit to the
determination of the union any question involving his
personal rights.”
Petitioners’ frustration over the performance of private
respondents, as well as their fears of a “fraudulent”
election to be held under the latter’s supervision, could
not justify the method they chose to impose their will on
the union.
USTFU’s constitution and by laws were violated
The importance of a union’s constitution and bylaws
cannot be overemphasized.  They embody a covenant
between a union and its members and constitute the
fundamental law governing the members’ rights and
obligations. As such, the union’s constitution and bylaws
should be upheld, as long as they are not contrary to
law, good morals or public policy.
The SC agreed with Bitonio and Med-Arbiter’s finding
that the election held was tainted with irregularities. First,
the Oct 4 assembly was not called by the union. It was
merely a convocation of faculty clubs. It was not
convened in accordance with the provision on general
membership meetings as found in the USTFU’s CBL.
Second, there was no COMELEC to oversee the
election as mandated by the CBL. Third, the election
was not done by secret balloting as mandated by the
CBL.
National Union of Bank Employees v. Minister of
Labor, Deputy Minister of Labor, Director of Bureau
of Labor Relations, and Producers Bank of the Phils.
Facts:
Petition for mandamus to compel public respondents to
conduct a certification election among the rank and file
employees of the respondent employer or in the
alternative, to require the respondent Minister of Labor
or his Deputy to act on private respondent's "Appeal"
and on petitioner's "Motion to Dismiss with Motion to
Execute."
Issue: Is it proper to order a certification election despite
the pendency of the petition to cancel herein petitioner
union's certificate of registration? - YES
Ratio/Doctrine:
The pendency of the petition for cancellation of the
registration certificate of herein petitioner union is not a
bar to the holding of a certification election. The
pendency of the petition for cancellation of the
registration certificate of petitioner union founded on the
alleged illegal strikes staged by the leaders and
members of the intervenor union and petitioner union
should not suspend the holding of a certification election,
because there is no order directing such cancellation.
As aptly ruled by respondent Bureau of Labor Relations
Director Noriel: "The rights of workers to self-
organization finds general and specific
constitutional guarantees. Section 7, Article IV of the
Philippine Constitution provides that the right to form
associations or societies for purposes not contrary to law
shall not be abridged. This right is more pronounced in
the case of labor. Section 9, Article II (ibid) specifically
declares that the State shall assure the rights of workers
to self-organization, collective bargaining, security of
tenure and just and humane conditions of work. Such
constitutional guarantees should not be lightly taken
much less easily nullified. A healthy respect for the
freedom of association demands that acts imputable to
officers or members be not easily visited with capital
punishments against the association itself"
Standard Chartered Bank Employees Union v.
Confesor(Labor Sec) and Standard Chartered Bank
Facts:
Petitioner and respondent Bank entered into 5-year CBA
with a provision to renegotiate the terms thereof on the
3rd yr. prior to the expiration of the 3-yr period, the Union
initiated the negotiations regarding political provisions
and 34 economic provisions. The Bank gave a counter
proposal for the non-economic provisions.
Negotiations for the economic aspect proceeded. Except
for the provisions regarding the uniforms and signing
bonus, the parties failed to agree on the remaining
economic provisions of the CBA. The Union declared a
deadlock and filed a notice of strike with the NCMB. The
Bank, on the other hand, filed a complaint for unfair labor
practice (ULP) before the Arbitration branch of NLRC.
Labor Sec Confesor assumed jurisdiction. She ordered
the Union to execute a CBA. All those provisions not
modified are retained while those being demanded by
either party are denied. She also dismissed the
complaint of the Bank for ULP for lack of merit.
The CBA was signed but the Union file a petition for
certiorari under Rule 65 alleging that Confesor
committed grave abuse of discretion.
Ratio/Doctrine:
Under the International Labor Organization Convention
(ILO) No. 87 FREEDOM OF ASSOCIATION AND
PROTECTION OF THE RIGHT TO ORGANIZE to which
the Philippines is a signatory, "workers and employers,
without distinction whatsoever, shall have the right to
establish and, subject only to the rules of the
organization concerned, to job organizations of their own
choosing without previous authorization."
Workers’ and employers’ organizations shall have
the right to draw up their constitutions and rules, to
elect their representatives in full freedom to organize
their administration and activities and to formulate
their programs. Article 2 of ILO Convention No. 98
pertaining to the Right to Organize and Collective
Bargaining, provides:
Article 2
1. Workers’ and employers’ organizations shall enjoy
adequate protection against any acts or interference by
each other or each other’s agents or members in their
establishment, functioning or administration.
2. In particular, acts which are designed to promote the
establishment of workers’ organizations under the
domination of employers or employers’ organizations or
to support workers’ organizations by financial or other
means, with the object of placing such organizations
under the control of employers or employers’
organizations within the meaning of this Article.
The aforecited ILO Conventions are incorporated in our
Labor Code, particularly in Article 243 thereof, which
provides:
ART. 243. COVERAGE AND EMPLOYEES’ RIGHT TO
SELF-ORGANIZATION. – All persons employed in
commercial, industrial and agricultural enterprises and in
religious, charitable, medical or educational institutions
whether operating for profit or not, shall have the right to
self-organization and to form, join, or assist labor
organizations of their own choosing for purposes of
collective bargaining. Ambulant, intermittent and itinerant
workers, self-employed people, rural workers and those
without any definite employers may form labor
organizations for their mutual aid and protection.
and Articles 248 and 249 respecting ULP of employers
and labor organizations.
Article 248(a) of the Labor Code, considers it an unfair
labor practice when an employer interferes, restrains or
coerces employees in the exercise of their right to self-
organization or the right to form association. The right to
self-organization necessarily includes the right to
collective bargaining.
Parenthetically, if an employer interferes in the selection
of its negotiators or coerces the Union to exclude from
its panel of negotiators a representative of the Union,
and if it can be inferred that the employer adopted the
said act to yield adverse effects on the free exercise to
right to self-organization or on the right to collective
bargaining of the employees, ULP under Article 248(a) in
connection with Article 243 of the Labor Code is
committed.
The circumstances that occurred during the negotiation
do not show that the suggestion made by Diokno to
Divinagracia is an anti-union conduct from which it can
be inferred that the Bank consciously adopted such act
to yield adverse effects on the free exercise of the right
to self-organization and collective bargaining of the
employees, especially considering that such was
undertaken previous to the commencement of the
negotiation and simultaneously with Divinagracia’s
suggestion that the bank lawyers be excluded from its
negotiating panel.
The records show that after the initiation of the collective
bargaining process, with the inclusion of Umali in the
Union’s negotiating panel, the negotiations pushed
through. The complaint was made only on August 16,
1993 after a deadlock was declared by the Union on
June 15, 1993.
It is clear that such ULP charge was merely an
afterthought. The accusation occurred after the
arguments and differences over the economic provisions
became heated and the parties had become frustrated. It
happened after the parties started to involve
personalities. As the public respondent noted, passions
may rise, and as a result, suggestions given under less
adversarial situations may be colored with unintended
meanings.
REYES vs. TRAJANO
FACTS:
Two labor organizations were contesting the right to be
the exclusive representative of the employees of Tri-
union industries, namely TUEU-OLALIA and TUPAS.
The ballots for the certification election provided for 3
choices: (a) TUPAS, (b) TUEU-OLALIA, (c) NO UNION.
Among 240 employees who cast their votes, 141 were
Iglesia ni Cristo (INC) members. The final tally of the
votes showed the following results:
TUPAS: 1; TUEU-OLALIA: 95; NO UNION: 1; SPOILED:
1; CHALLENGED: 141.
The challenged votes were cast by INC members. Upon
agreement of the competing unions, votes of the INC
members were excluded from the count. Petitioners filed
petition to cancel the election alleging that it was unfair
and that it did not represent the true sentiment of the
majority. This was opposed by the TUEU-OLALIA, which
claimed that the petitioners "do not have legal
personality to protest the results of the election,"
because "they are not members of either contending
unit, but . . . of the INK" which prohibits its followers, on
religious grounds, from joining or forming any labor
organization.
ISSUE: Whether the INC employees, in voting for “NO
UNION” during the elections, exercised their right to self-
organization and that as such, their votes should be
counted?
HELD: Yes, the right of self-organization embraces not
only the right to form, join or assist labor organizations,
but the concomitant, converse right NOT to form, join or
assist any labor union. The right of self-organization
includes the right to organize or affiliate with a labor
union or determine which of two or more unions in an
establishment to join, and to engage in concerted
activities with co-workers for purposes of collective
bargaining through representatives of their own
choosing, or for their mutual aid and protection. The right
NOT to join, affiliate with, or assist any union, and to
disaffiliate or resign from a labor organization, is
subsumed in the right to join, affiliate with, or assist any
union, and to maintain membership therein. The right to
form or join a labor organization necessarily includes the
right to refuse or refrain from exercising said right. It is
self-evident that just as no one should be denied the
exercise of a right granted by law, so also, no one
should be compelled to exercise such a conferred right.
The purpose of a certification election is the
ascertainment of the wishes of the majority of the
employees in the appropriate bargaining unit: to be or
not to be represented by a labor organization, and by
which particular labor organization. If the results of the
election should disclose that the majority of the workers
do not wish to be represented by any union, then their
wishes must be respected, and no union may properly
be certified as the exclusive representative of the
workers in the bargaining unit in dealing with the
employer. The minority employees — who wish to have
a union represent them in collective bargaining — can
do nothing but wait for another suitable occasion to
petition for a certification election and hope that the
results will be different. They should not be permitted, to
impose their will on the majority upon the plea that they,
the minority workers, are being denied the right of self-
organization and collective bargaining.
The respondents' argument that the petitioners are
disqualified to vote because they "are not constituted
into a duly organized labor union" — "but members of
the INK which prohibits its followers, on religious
grounds, from joining or forming any labor organization"
is specious. Neither law, administrative rule nor
jurisprudence requires that only employees affiliated with
any labor organization may take part in a certification
election. On the contrary, the intendment of the law is to
grant the right to vote to all bona fide employees in the
bargaining unit, whether they are members of a labor
organization or not. As held in Airtime Specialists, Inc.
v. Ferrer-Calleja: In a certification election all rank-and-
file employees in the appropriate bargaining unit are
entitled to vote. 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.
Petition granted.
PAN-AM WORLD AIRWAYS vs. PAN-AM E.U.
FACTS:
Respondent union declared and maintained a strike
against petitioner Pan-am. The President certified the
strike to the CIR as being an industrial dispute affecting
national interest. . It was the position of the Union that its
members would not resume the performance of their
duties unless its officers were likewise included in the
return-to-work order. Petitioner was agreeable to having
the workers return to work but not the five officials of
respondent Union which led the strike. It alleged that the
strike was illegal, being offensive to a no-strike clause of
an existing collective bargaining agreement the result
being that the officials could, as the responsible parties,
be liable for dismissal. Consequently, it was not
agreeable to their being allowed to return to the positions
held by them prior to the strike as they would not be only
lacking in "incentive and motivation for doing their work
properly" but would likewise have the opportunity to
cause "grave and irreparable injury to petitioner. CIR
judge issued an order requiring petitioner to accept the
five union officers pending resolution on the merits of the
dispute involved in the strike.
ISSUE:
Whether the return to work order for the said 5 union
officials was characterized with grave abuse of
discretion?
HELD:
No, it was a valid order made by the CIR judge who had
jurisdiction to try and decide the case.
There is both a constitutional and statutory recognition
that laborers have the right to form unions to take care of
their interests vis-a-vis their employers. Their freedom
organizations would be rendered nugatory if they could
not choose their own leaders to speak on their behalf
and to bargain for them. If petitioner were to succeed in
their demand, the effect would be to effectively deprive
the rank and file of their freedom of choice as to who
should represent them. To that extent then, their
constitutional and statutory right to freedom of
association suffers an impairment hardly to be
characterized as inconsequential.
Petitioner’s offer to deposit the salaries of the five
officers with respondent Court to be paid to them,
coupled with a concession that if their right to return to
work be not recognized, there would be no need for
refund, only adds insult to injury. The record is bereft of
slightest indication that any danger, much less one clear
and present, is to be expected from their return to work.
Necessarily, the union officials have the right to feel
offended by the fact that, while they will be paid their
salaries in the meanwhile they would not be considered
as fit persons to perform the duties pertaining to the
positions held by them.
UNION OF SUPERVISORS vs. SEC. OF LABOR,
REPUBLIC BANK
FACTS:
Petitioner union filed with the NLRC a complaint against
respondent Bank, charging it with unfair labor practice
committed against its president Mr. Norberto Luna, for
harassment, unjust suspension from his employment as
Manager of respondent's San Juan branch and as
member of the Board of Trustees of the RB Provident
Fund, as well as his unlawful dismissal as Administrator
and Secretary of the said fund, all due to his militant
espousal and defense of workers' rights. The bank
alleged that the dismissal was for cause, citing as basis
thereof (1) grave misconduct for making derogatory and
libelous remarks against the bank management as a
whole and against the AVP in particular, and (2)
insubordination for refusal to obey the lawful order of his
superior.
The Republic Bank Provident Fund was established
pursuant to the collective bargaining agreement between
the employees and respondent bank for the benefit of
the officers and employees of the Republic Bank. The
problem arose when Luna objected to the proposal
made by another member of the Board of Trustees to
reorganize the fund so as to tie it up with the Investment
Money Market Operations of the bank. Luna vehemently
objected to this, saying that the Provident Fund does not
belong to the respondent bank but to the officers and
employees. A heated discussion followed, during which
the alleged libellous remarks were uttered by Luna
against bank management and against Mr. de Vera
specifically. The reorganization move was carried by a 3
to 2 vote. To protect the interests of the fund, Mr. Luna
moved that a trust agreement be executed between the
trustees on the one hand and the members of the
provident fund on the other, and that the trustees should
execute a bond. This motion was denied. Disgusted,
Luna walked out. A new administrator for the fund was
appointed by the Board and Luna was requested to turn
over all the pertinent records and documents to such
replacement. Administrative investigations were
conducted regarding Luna’s conduct with the end result
of dismissing him from employment.
ISSUE:
Whether Luna’s utterances and alleged acts of
insubordination constitute just cause for his dismissal
and whether such dismissal constitutes an unfair labor
practice (ULP)?
HELD:
There was no just cause for the dismissal. The charge of
grave misconduct for the alleged derogatory and
libellous remarks uttered by Luna is without basis. First
of all, the accuracy of the minutes of the meeting, which
contained the alleged libellous remarks made by Luna, is
questionable at best. Second, even if what was
contained in said minutes accurately reflected the
statements made by Luna during the meeting, the same
could not be considered as being libellous for it is
privileged in nature as a valid exercise of his
constitutional freedom of expression. He addressed his
remarks to the body that has jurisdiction over the
question of management of the assets of the Provident
Fund. Luna's remarks were intended to protect the
interests of the members of the Provident Fund from
what he honestly believed was a risky venture on the
part of the management. His protests could even be
treated as union activity by the Industrial Peace Act.
Luna's membership in the PF Board of Trustees was by
virtue of his being president of the RB Union of
Supervisors. The Provident Fund was itself created as a
result of the union's CBA with the bank. Luna was
therefore acting out his role as protector of his
constituents when he voiced out his apprehension and
protests over the plan of management. It matters not that
he acted singly or individually. What is important is that
he had been selected by the supervisors of respondent
bank to be their president and representative in the PF
Board of Trustees. His actuations as such should
therefore be considered as legitimate exercise of the
employees' right to self-organization and as an activity
for their mutual aid and protection, aside from being
privileged communication protected by the constitutional
guarantee on free speech.
The other basis for dismissal, insubordination, is likewise
without justifiable ground. Such charge arose out of the
alleged refusal of Luna to obey the order of his superior,
to turn over the records of the Provident Fund to the new
administrator. The "order" referred to was not an order
but a letter-request as it was in fact entitled "Request to
Turn Over Records re Provident Fund". Upon receipt
thereof, Luna immediately answered in writing explaining
why he feels justified to keep them. In his answer to the
charges, Luna averred that when no follow-up was made
thereon, he assumed that his explanation had been
satisfactory. Indeed, the Board of Trustees, upon receipt
of such written explanation, should have referred the
matter to the grievance machinery under the CBA. This
was not done. Instead, management preferred as many
charges as it could frame against Luna, obviously to
make sure that if one charge could not suffice to bring
about his ouster, the other charges might produce the
desired result.
It is evident, from surrounding facts, that the respondent
bank's predilection to oust Luna was because of his
union activities. Luna was the Branch Manager of
respondent bank's San Juan Branch and for eleven (11)
years the president of the RB Union of Supervisors. It is
likewise not denied that the Union of Supervisors had,
prior to this case, caused the filing of several cases
against the bank with the NLRC. As a result of his active
defense of union rights, he was viewed as a threat by
the bank’s management on the latter’s plan to control the
funds of the Provident Fund which was established as a
result of the collective bargaining agreement.
Understandably therefore, they wanted him out.
All these circumstances taken together indubitably show
that Luna's discharge was discriminatory and constituted
unfair labor practice under paragraph (5) Section 4 of the
Industrial Peace Act. He is therefore entitled to
reinstatement with back wages pursuant to the policy to
decree back wages not exceeding three (3) years
without requiring the parties to submit proof of
compensation received from other sources at the time of
illegal dismissal until actual reinstatement.
FEU-DR. REYES MEDICAL FOUNDATION vs.
TRAJANO, AFW
FACTS:
The petitioner has a workforce of about 350 rank and file
employees, majority of whom are members of
respondent union Alliance of Filipino Workers (AFW).
AFW filed a Petition for Certification Election with the
Ministry of Labor, which was subsequently opposed by
petitioner on the ground that a similar petition involving
the same issues and the same parties is pending
resolution before the SC. AFW admitted filing a previous
petition before the SC, after the Med Arbiter and
Secretary of Labor both held that as petitioner was a
non-stock and non-profit medical institution, its
employees may not form, join or organize a union
pursuant to Article 244 of the Labor code. Such petition
assailed the constitutionality of the then Article 244.
However, pending the resolution of this petition, BP 70
was enacted amending Art 244, thus granting even the
employees of non-stock, non-profit institutions the right
to form, join and organize labor unions of their choice. In
the exercise of such right, private respondent AFW filed
another certification for election with the Ministry of
Labor and Employment. The Med Arbiter granted the
petition, declaring that a certification election be
conducted to determine the exclusive bargaining
representative of all rank and file employees of the
petitioner. Respondent Director affirmed this order on
appeal.
ISSUE:
Whether respondent Director gravely abused his
discretion in granting the petition for the certification
election, despite the pendency of a similar petition
before the SC which involves the same parties for the
same cause?
HELD:
No, he did not act with grave abuse of discretion in
granting the petition for certification election.
At the time AFW filed its petition for certification election,
Article 244 of the LC was already amended by BP 70, to
wit:
“Article 244. Coverage and employees’ right to self-
organization.—All persons employed in commercial,
industrial and charitable, medical, or educational
institutions whether operating for profit or not, shall have
the right of self-organizations of their own choosing for
purposes of collective bargaining. xxx”
Under this provision, there is no doubt that rank and file
employees of non-profit medical institutions (as
petitioner) are now permitted to form, join or organize
labor unions of their choice for purposes of collective
bargaining. As AFW had complied with the requisites
provided by law for calling a certification election, it was
incumbent upon respondent Director to conduct such
certification election to ascertain the bargaining
representative of petitioner’s employees.
Any judgment which may be rendered in the petition for
certiorari pending before the SC will not constitute as res
judicata in the petition for certification election under
consideration, for while in the former, AFW questioned
the constitutionality of Article 244 before its amendment,
in the latter, AFW invokes the same article as already
amended.
Petition dismissed. Decision affirmed.
Victoriano V. Elizalde Rope Workers
Facts:
Victoriano was a member of the INC w/c prohibits
associations. The Union had a closed shop bargaining
agreement with the company and anyone who was not a
member of the union was to be dismissed by the
company. When Victoriano resigned from the labor
union the union asked the company to dismiss him.
Victoriano filed a case to enjoin the Company from
dismissing him. Citing the industrial peace act that
provided an exception to people with religious beliefs
that prohibited them from joining labor unions.
Ratio:
the Constitution and the Industrial Peace Act have
recognized, and guaranteed to the employee, is the
"right" to join associations of his choice, it would be
absurd to say that the law also imposes, in the same
breath, upon the employee the duty to join associations.
The law does not enjoin an employee to sign up with any
association.
The legal protection granted to such right to refrain from
joining is withdrawn by operation of law, where a labor
union and an employer have agreed on a closed shop,
by virtue of which the employer may employ only
member of the collective bargaining union, and the
employees must continue to be members of the union
for the duration of the contract in order to keep their jobs.
Thus Section 4 (a) (4) of the Industrial Peace Act, before
its amendment by Republic Act No. 3350, provides that
although it would be an unfair labor practice for an
employer "to discriminate in regard to hire or tenure of
employment or any term or condition of employment to
encourage or discourage membership in any labor
organization" the employer is, however, not precluded
"from making an agreement with a labor organization to
require as a condition of employment membership
therein, if such labor organization is the representative of
the employees". By virtue, therefore, of a closed shop
agreement, before the enactment of Republic Act No.
3350, if any person, regardless of his religious beliefs,
wishes to be employed or to keep his employment, he
must become a member of the collective bargaining
union. Hence, the right of said employee not to join the
labor union is curtailed and withdrawn.
What the exception provides, therefore, is that members
of said religious sects cannot be compelled or coerced to
join labor unions even when said unions have closed
shop agreements with the employers; that in spite of any
closed shop agreement, members of said religious sects
cannot be refused employment or dismissed from their
jobs on the sole ground that they are not members of the
collective bargaining union. It is clear, therefore, that the
assailed Act, far from infringing the constitutional
provision on freedom of association, upholds and
reinforces it. It does not prohibit the members of said
religious sects from affiliating with labor unions. It still
leaves to said members the liberty and the power to
affiliate, or not to affiliate, with labor unions. If,
notwithstanding their religious beliefs, the members of
said religious sects prefer to sign up with the labor union,
they can do so. If in deference and fealty to their
religious faith, they refuse to sign up, they can do so; the
law does not coerce them to join; neither does the law
prohibit them from joining; and neither may the employer
or labor union compel them to join.
Kapatiran sa Meat V. Calleja
Facts:
Universal Robina Meat Canning was looking at whom to
negotiate with as a union:
Kapatrian sa Meat TUPAS chapter
New Employees Workers United Labor Organization
(NEW ULO) [composed mostly of INC members]
Non-Union Workers
TUPAS staged a strike but was enjoined from doing so,
and NEW ULO asked the Bureau on Labor Relations to
make them the bargaining unit the Company was going
to deal with claiming that majority of the rank and file
workers were in their union. TUPAS moved to dismiss
this request because NEW ULO was an INC union who,
years before, refused to join any unions.
Ratio:
Court's decision in Victoriano vs. Elizalde Rope Workers'
Union, 59 SCRA 54, upholding the right of members of
the IGLESIA NI KRISTO sect not to join a labor union for
being contrary to their religious beliefs, does not bar the
members of that sect from forming their own union. The
public respondent correctly observed that the
"recognition of the tenets of the sect ... should not
infringe on the basic right of self-organization granted by
the constitution to workers, regardless of religious
affiliation."
Paper Industries V Laguesma
Facts:
PICOP-Bislig Supervisory and Technical Staff
Employees Union (the Union) instituted an election that it
be the sole entity that deals with Paper Industries (the
Company). The Company moved that 487 of the
employees be excluded from the election, being
managerial/ supervisory employees.
Ratio:
a thorough dissection of the job description of the
concerned supervisory employees and section heads
indisputably show that they are not actually managerial
but only supervisory employees since they do not lay
down company policies. PICOP's contention that the
subject section heads and unit managers exercise the
authority to hire and fire is ambiguous and quite
misleading for the reason that any authority they
exercise is not supreme but merely advisory in
character. Theirs is not a final determination of the
company policies inasmuch as any action taken by them
on matters relative to hiring, promotion, transfer,
suspension and termination of employees is still subject
to confirmation and approval by their respective superior.
Thus, where such power, which is in effect
recommendatory in character, is subject to evaluation,
review and final action by the department heads and
other higher executives of the company, the same,
although present, is not effective and not an exercise of
independent judgment as required by law.
Samson V NLRC
Facts:
An employee was dismissed for saying “bullshit yan”,
“putangina” and using the dirty middle finger during a
Christmas party where he was a bit drunk. These
comments were directed against how his bosses
handled the Cua Lim case.
Ratio:
His dismissal justified on ground of loss of confidence.
As a ground for dismissal, the term "trust and
confidence" is restricted to managerial employees. We
share the view of the Solicitor General that petitioner is
not a managerial employee. Before one may be properly
considered a managerial employee, all the following
conditions must be met:
(1) Their primary duty consists of the management of the
establishment in which they are employed or of a
department or sub-division thereof;
(2) They customarily and regularly direct the work of two
or more employees therein;
(3) They have the authority to hire or fire other
employees of lower rank; or their suggestions and
recommendations as to the hiring and firing and as to
the promotion or any other change of status of other
employees are given particular weight.
Further, it is the nature of the employee’s functions, and
not the nomenclature or title given to his job, which
determines whether he has rank-and-file, supervisory or
managerial status. Petitioner describes his functions as
District Sales Manager as follows:
"The office of a District Sales Manager’s primary
responsibility is to achieve or surpass the sales and
profit targets for each territory in the assigned district
through: (a) efficient planning; (b) management function;
and (c) auditing and control. "Management action," on
the other hand, means to direct the activities of the
Professional Medical Representatives [by]: (1) [making]
decisions that are compatible with district, national and
corporate objectives; (2) [directing] the activities of
representative through - (a) frequent field visits (must
spend at least 80% of working days in a quarter,
allocating eight (8) working days per PMR/quarter
excluding travel time); (b) written communications; (c)
sales meetings – (3) [training] PMRs in medical/product
knowledge; (4) [motivating] and [developing] PMRs
toward greater productivity; (5) [acting] as a channel
between field and home office; (6) [maintaining] records
as basis for quick analysis of the district performance;
(7) [overseeing] special projects assuring the cost
benefit value of such benefit; (8) x x x suggesting to
sales management new ideas, methods, devices to
increase productivity of sales district or individual
properties; and [insuring] safe custody and proper
maintenance of all company properties (e.g. company
cars, audio-visuals).
The above job description does not mention that
petitioner possesses the power "to lay down policies nor
to hire, transfer, suspend, lay off, recall, discharge,
assign or discipline employees." Absent this crucial
element, petitioner cannot be considered a managerial
employee despite his designation as District Sales
Manager.
Manila Electric Co. v. Secretary of Labor and
Employment
Facts:
The Staff and Technical Employees Association of
Meralco filed a petition for certification of election
seeking to represent regular employees of Meralco,
among such employees are the non-managerial
employees in the Patrol Division, Treasury Security
Services Section (security services personnel).
Issue: WON security guards have the right to self-
organize (e.g. can join or assist the rank and file
bargaining unit)
Held/Ratio:
Yes. It is true that par. 2, Sec. 1, rule II, Book V of the
Implementing rules of RA 6715 as well as Sec. 2 (c),
Rule V also of Book V bar security guards from joining a
rank and file organization. RA 6715 however amended
the Labor Code wherein it disqualified supervisory
employees from membership in a labor organization of
the rank-and-file employees. It did not include security
guards in the disqualification. The implementing rules
therefore insofar as the disqualify security guards are
null and void, for being not germane to the object and
purpose of RA 6715 upon which such rules purportedly
derive statutory moorings. Under RA 6715, security
guards may now freely join a labor organization of the
rank and file or that of a supervisory union, depending
on their rank.
Note: The Court nevertheless discusses the possible
consequences of allowing security personnel to join
labor unions and says, “the law is apt to produce divided
loyalties in the faithful performance of their duties …
Security personnel may neglect or outright abandon their
duties, such as protection of property of their employer
and the persons of its officials and employees, the
control of access to ER’s premises and maintenance of
order in the event of emergencies and untoward
incidents.”
Standard Chartered Bank Employees Union v.
Standard Chartered Bank
Facts:
Petitioner union and the bank began negotiating for a
new CBA. The union sought to be removed from the list
of excluded employees [from the bargaining unit] some
employees, which the Secretary of Labor denied.
Issue: Whether the Chief cashiers, Assistant cashiers,
personnel of the Telex dept and HR staff are confidential
employees such that they should be excluded.
Held/Ratio:
Yes. While Article 245 of the Labor Code limits the
ineligibility to join, form and assist any labor organization
to managerial employees, jurisprudence has extended
this prohibition to confidential employees or those who
by reason of their positions or nature of work are
required to assist or act in a fiduciary manner to
managerial employees and hence, are likewise privy to
sensitive and highly confidential records.
As regards the qualification of bank cashiers as
confidential employees - they are confidential employees
having control, custody and/or access to confidential
matters, e.g., the branch's cash position, statements of
financial condition, vault combination, cash codes for
telegraphic transfers, demand drafts and other
negotiable instruments; radio and telegraph operators
– confidential employees, for they have access to
confidential information and may act as spy or spies of
either party to a collective bargaining agreement;
personnel staff, in which human resources staff may
be qualified, as confidential employees because by the
very 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.
San Miguel Corp. Supervisors and Exempt
Employees Union v. Laguesma
Facts:
Petitioner union filed before the DOLE a petition for
certification election among the supervisors and exempt
employees of the SMC. DOLE undersecretary
Laguesma issued an order excluding employees under
supervisory levels 3 and 4 and the so-called exempt
employees from the proposed bargaining unit stating
they are confidential employees.
Issue: WON supervisory employees 3 and 4 and the
exempt employees are confidential employees hence
ineligible from joining the union.
Held/Ratio:
No. 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. 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
employees and his supervisor, and the supervisor must
handle the prescribed responsibilities relating to labor
relations.
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.
“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.”
In this case, the confidential information known the
subject employees relate to the internal business
operations of the employer (e.g. product formulation,
standards and specification) and NOT to labor relations.
Note that, the information held by the employees must
relate to the employer’s labor relations policies for him to
be regarded a confidential employee. The information
must have relevance to negotiations and settlement of
grievances wherein the interests of a union and the
management is invariably adversarial.
Sugbuanon Rural Bank, Inc. v. Laguesma
Facts:
Sugbuanon Rural Bank employed some 5 supervisory
employees (cashiers, accountants and acting chief of the
loans dept – work involved evaluating capacity to
borrow, approving loans, scheduling terms of repayment,
etc.). Private respondent, APSOTEU, a legitimate labor
organization filed a petition for certification election of
said supervisory employees. The bank opposed the
petition on the ground that said employees were
managerial or confidential employees.
Issue: WON said employees are managerial and/or
confidential employees hence prohibited from joining
labor organizations.
Held/Ratio:
No. 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. 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
employees and his supervisor, and the supervisor must
handle the prescribed responsibilities relating to labor
relations.
Art. 245 of the LC does not directly prohibit confidential
employees from engaging in union activities; however
under the doctrine of necessary implication, the
disqualification of managerial employees equally applies
to confidential employees.
The confidential-employee rule justifies exclusion of
confidential employees because in the normal course of
their duties they become aware of management policies
relating to labor relations. When the employee does not
have access to confidential labor relations information,
there is no legal prohibition against confidential
employees from forming, assisting or joining a union.
Cainta v Cainta
Facts:
After being elected as President and Vice-President of
the Union of employees in Cainta Catholic School, Mrs.
Rosalina Llagas and Paz Javier were retired by the said
school in accordance to the CBA. Llagas was the Dean
of the Student Affairs while Javier was a occupying the
position of Subject Area Coordinator.
The employees of the school held a strike as they
alleged that the retirement of the two was a form of
union busting.
Doctrine:
Llagas and Javier were managerial and supervisory
employees, respectively.
Article 212(m) of the Labor Code defines a managerial
employee as "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." The
Deans of the Student Affairs has functions such as
enforcing school rules, planning student leadership
training programs and proposing extra-curricular and co-
curricular activities for the students. The Subject Area
Coordinator, on the other hand, has functions like
recommending appointment of faculty member in the
departments, their promotion and eventual termination.
Having established that Llagas is a managerial
employee, she is proscribed from joining a labor union,
more so being elected as union officer. In the case of
Javier, a supervisory employee, she may join a labor
union composed only of supervisory employees. Finding
both union officers to be employees not belonging to the
rank-and-file, their membership in the Union has become
questionable, rendering the Union inutile to represent
their cause.
Metrolab Industries, Inc. v Roldan-Confessor
Metrolab is one of the leading manufacturers and
suppliers of medical and pharmaceutical products to the
country. In a decision of the Secretary of Labor, the CBA
of Metrolab with its employees excluded only the
managerial employees from joining the bargaining unit of
the rank and file employees. Metrolab, however,
maintains that executive secretaries of the General
Manager and the executive secretaries of the Quality
Assurance Manager, Product Development Manager,
Finance Director, Management System Manager, etc.,
who are all members of the company’s Management
Committee should not only be exempted from the
closed-shop provision but should be excluded from
membership in the bargaining unit of the rank and file
employees as well on grounds that their executive
secretaries are confidential employees, having access to
“vital labor information.”
Doctrine:
Although Article 245 of the Labor Code[20] limits the
ineligibility to join, form and assist any labor organization
to managerial employees, jurisprudence has extended
this prohibition to confidential employees or those who
by reason of their positions or nature of work are
required to assist or act in a fiduciary manner to
managerial employees and hence, are likewise privy to
sensitive and highly confidential records.
In Bulletin Publishing Co., Inc. vs. Hon. Augusto
Sanchez, this Court elaborated on this rationale, thus:
x x x The rationale for this inhibition has been stated to
be, because 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 interests. The Union can also become
company-dominated with the presence of managerial
employees in Union membership.”
In Golden Farms, Inc. vs. Ferrer-Calleja, this Court
explicitly made this rationale applicable to confidential
employees:
This rationale holds true also for confidential employees
such as accounting personnel, radio and telegraph
operators, who having access to confidential information,
may become the source of undue advantage. Said
employee(s) may act as a spy or spies of either party to
a collective bargaining agreement. This is especially
true in the present case where the petitioning Union is
already the bargaining agent of the rank-and-file
employees in the establishment. To allow the
confidential employees to join the existing Union of the
rank-and-file would be in violation of the terms of the
Collective Bargaining Agreement wherein this kind of
employees by the nature of their functions/positions are
expressly excluded.”
Pepsi Cola Products v Secretary of Labor
The pivot of inquiry here is: whether or not a supervisors’
union can affiliate with the same Federation of which two
(2) rank and file unions are likewise members, without
violating Article 245 of the Labor Code (PD 442), as
amended, by Republic Act 6715, which provides:
“Art. 245. Ineligibility of managerial employees to join
any labor organization; right of supervisory employees.-
Managerial employees are not eligible to join, assist or
form any labor organization. Supervisory employees
shall not be eligible for membership in a labor
organization of the rank-and-file employees but may join,
assist or form separate labor organizations of their own.”
Doctrine:
The prohibition against a supervisors’ union joining a
local union of rank and file is replete with jurisprudence.
The Court emphasizes that the limitation is not confined
to a case of supervisors’ wanting to join a rank-and-file
union. The prohibition extends to a supervisors’ local
union applying for membership in a national federation
the members of which include local unions of rank and
file employees. The intent of the law is clear especially
where, as in this case at bar, the supervisors will be co-
mingling with those employees whom they directly
supervise in their own bargaining unit.”
“xxx A confidential employee is one entrusted with
confidence on delicate matters, or with the custody,
handling, or care and protection of the employer’s
property. While Art. 245 of the Labor Code singles out
managerial employee as ineligible to join, assist or form
any labor organization, under the doctrine of necessary
implication, confidential employees are similarly
disqualified. This doctrine states that what is implied in a
statute is as much a part thereof as that which is
expressed, as elucidated in several cases.
In applying the doctrine of necessary implication, we
took into consideration the rationale behind the
disqualification of managerial employees expressed in
Bulletin Publishing Corporation v. Sanchez, thus “xxx 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
interests. The Union can also become company –
dominated with the presence of managerial employees
in Union membership.” Stated differently, in the
collective bargaining process, managerial employees are
supposed to be on the side of the employer, to act as its
representatives, and to see to it that its interest are well
protected. The employer is not assured of such
protection if these employees themselves are union
members. Collective bargaining in such a situation can
become one-sided. It is the same reason that impelled
this Court to consider the position of confidential
employees as included in the disqualification found in
Art. 245 as if the disqualification of confidential
employees were written in the provision. If confidential
employees could unionize in order to bargain for cooperatives may exercise some of the rights and
advantages for themselves, then they could be governed privileges given to ordinary corporations provided under
by their own motives rather than the interest of the existing laws, such cooperatives enjoy other privileges
not granted to the latter. The cooperative’s owners
employers. Moreover, unionization of confidential
and/or members are the ones who run and operate the
employees for the purpose of collective bargaining would business while the others are its employees. Irrespective
mean the extension of the law to persons or individuals of the number of shares owned by each member they
who are supposed to act “in the interest of” the are entitled to cast one vote each in deciding upon the
employers. It is not farfetched that in the course of affairs of the cooperative. Their share of capital earns
collective bargaining, they might jeopardize that interest limited interest. They enjoy special privileges as-
which they are duty bound to protect. Along the same exemption from income tax and sales taxes, preferential
right to supply their products to State agencies and even
line of reasoning we held in Golden Farms, Inc. vs.
exemption from the minimum wage laws.
Ferrer-Calleja reiterated in Philips Industrial
Development, Inc., NLRC, that “confidential employees An employee therefore of such a cooperative who is a
such as accounting personnel, radio and telegraph member and co-owner thereof cannot invoke the right to
operators who, having access to confidential information, collective bargaining for certainly an owner cannot
may become the source of undue advantage. Said bargain with himself or his co-owners.
employee(s) may act as spy or spies of either party to a
Central Negros Electric Cooperative, Inc. (CENECO)
collective bargaining agreement.”
vs. DOLE Secretary
Benguet Electric Cooperative, Inc. v Calleja
Facts:
CENECO denied CENECO Union of Rational
Facts:
Employees’ (CURE's) request for conducting
Beneco Worker's Labor Union-Association of Democratic
negotiations for a new collective bargaining agreement
Labor Organizations (BWLU- ADLO) filed a petition for
(CBA) between them on the ground that, under
direct certification as the sole and exclusive bargaining
applicable decisions of the Supreme Court, employees
representative of all the rank and file employees of
who at the same time are members of an electric
Benguet Electric Cooperative, Inc.
cooperative are not entitled to form or join a union.
It was agreed by CURE members that all union
Doctrine:
members shall withdraw, retract, or recall the union
The right to collective bargaining is not available to an
members' membership from CENECO in order to avail
employee of a cooperative who at the same time is a
the full benefits under the existing CBA and the
member and co-owner thereof. With respect, however,
supposed benefits that the members may avail under the
to employees who are neither members nor co-owners
renewed CBA. However, the withdrawal of the
of the cooperative they are entitled to exercise the rights
membership was denied by CENECO.
to self-organization, collective bargaining and negotiation
as mandated by the 1987 Constitution and applicable
Issue: Whether or not the employees of CENECO who
statutes.
withdrew their membership from the cooperative are
entitled to form or join CURE for purposes of the
The fact that the members-employees of petitioner do
negotiations for a CBA.
not participate in the actual management of the
cooperative does not make them eligible to form, assist
Decision/Ratio:
or join a labor organization for the purpose of collective
Yes. It appears that the Articles of Incorporation of
bargaining with petitioner. The Court's ruling in the
CENECO do not provide any ground for withdrawal from
Davao City case that members of cooperative cannot
membership which accordingly gives rise to the
join a labor union for purposes of collective bargaining
presumption that the same may be done at any time and
was based on the fact that as members of the
for whatever reason. In addition, membership in the
cooperative they are co-owners thereof. As such, they
cooperative is on a voluntary basis. Hence, withdrawal
cannot invoke the right to collective bargaining for
therefrom cannot be restricted unnecessarily. The right
"certainly an owner cannot bargain with himself or his
to join an organization necessarily includes the
co-owners." It is the fact of ownership of the cooperative,
equivalent right not to join the same.
and not involvement in the management thereof, which
The right of the employees to self-organization is a
disqualifies a member from joining any labor
compelling reason why their withdrawal from the
organization within the cooperative. Thus, irrespective of
cooperative must be allowed. As pointed out by CURE,
the degree of their participation in the actual
the resignation of the member- employees is an
management of the cooperative, all members thereof
expression of their preference for union membership
cannot form, assist or join a labor organization for the
over that of membership in the cooperative. The avowed
purpose of collective bargaining.
policy of the State to afford fall protection to labor and to
promote the primacy of free collective bargaining
Membership in a cooperative is not the same as
mandates that the employees' right to form and join
ownership of stocks in ordinary corporations. While
unions for purposes of collective bargaining be accorded
the highest consideration.
However, the direct certification ordered by the DOLW
Secretary is not proper. By virtue of EO 111, the direct
certification originally allowed under Article 257 of the
Labor Code has apparently been discontinued as a
method of selecting the exclusive bargaining agent of
the workers. This amendment affirms the superiority of
the certification election over the direct certification
which is no longer available now under the change in
said provision.
Republic vs. Asiapro Cooperative
Facts:
Petitioner SSS sent a letter to the respondent
cooperative informing that based on the Service
Contracts it executed with Stanfilco, respondent
cooperative is actually a manpower contractor supplying
employees to Stanfilco. For that reason, it is an
employer of its owners-members working with Stanfilco.  dismiss the petition for certification election. On the other
Thus, respondent cooperative should register itself with
petitioner SSS as an employer and make the
corresponding report and remittance of premium
contributions in accordance with the Social Security Law
of 1997.  The respondent cooperative asserted that it is
not an employer because its owners-members are the
cooperative itself; hence, it cannot be its own employer.  business operations of private respondent
Accordingly, petitioner SSS, filed a Petition before
petitioner SSC against the respondent cooperative and
Stanfilco praying that the respondent cooperative or, in
the alternative, Stanfilco be directed to register as an
employer and to report respondent cooperative’s
owners-members as covered employees under the
compulsory coverage of SSS and to remit the necessary
contributions in accordance with the Social Security Law
of 1997.  Decision/Ratio:
Issue: Whether or not SSC has jurisdiction over the
petition-complaint filed before it by petitioner SSS
Decision/Ratio:
Yes. It is clear then from Section 5 of Republic Act No.
8282 and Section 1, Rule III of the 1997 SSS Revised
Rules of Procedure that any issue regarding the
compulsory coverage of the SSS is well within the
exclusive domain of the petitioner SSC.  It is important to
note, though, that the mandatory coverage under the
SSS Law is premised on the existence of an employer-
employee relationship except in cases of compulsory
coverage of the self-employed.
In determining the existence of an employer-employee
relationship, the following elements are considered: (1)
the selection and engagement of the workers; (2) the
payment of wages by whatever means; (3) the power of
dismissal; and (4) the power to control the worker’s
conduct, with the latter assuming primacy in the overall
consideration. All these four elements have been proven
by the court to exist.
The existence of an employer-employee relationship
cannot be negated by expressly repudiating it in a
contract, when the terms and surrounding circumstances
show otherwise.  The employment status of a person is
defined and prescribed by law and not by what the
parties say it should be.
Republic Planters Bank vs. Bienvenido Laguesma
Facts:
Petitioner filed a petition for certification election to
determine the sole and exclusive bargaining
representative of all regular employees outside the
bargaining unit of Republic Planters Bank. The proposed
bargaining unit is composed of personnel allegedly
considered as contractual employees by private
respondent bank and are excluded from the existing
collective bargaining agreement between private
respondent and Republic Planters Bank Employees
Union (RPBEU), the duly certified bargaining
representative of the regular employees of private
respondent.
Private respondent filed its position paper and moved to
hand, petitioner opposed the motion to dismiss and
averred that the proposed unit is not part of the existing
bargaining unit. Petitioner further argued that some of its
members had been in the employ of private respondent
for more than six (6) months. Allegedly, they perform
services that are necessary and desirable to the usual
Issue: Whether or not there is grave abuse of discretion
on the part of public respondent when (1) it allowed
private respondent to participate or intervene in the
certification election, contrary to our decision in Golden
Farms Inc. vs. Secretary of Labor; and (2) it did not give
value to the documents it submitted on appeal.
No. In Golden Farms Inc., we upheld the general rule
that "an employer has no legal standing to question a
certification election since this is the sole concern of the
workers." Its facts, however, are different for in said
case, the existence of employer-employee relationship
was not disputed. Likewise, the petition for certification
election was filed within the freedom period.
If the union members are not employees, no right to
organize for purposes of bargaining, nor to be certified
as bargaining agent can be recognized. Since the
persons involved are not employees of the company, we
held that they are not entitled to the constitutional right to
join or form a labor organization for purposes of
collective bargaining.
The public respondent did not commit grave abuse of
discretion when it rejected the documents submitted by
petitioner for the first time on appeal. The public
respondent rejected the documents defining the duties of
the members of petitioner union in question less
because they were belatedly submitted only on appeal
but more because they were self-serving and did not
bear the approval of their employer.
Mactan Workers Union vs. Don Ramon Aboitiz
Facts:
Petitioner filed, on behalf of seventy-two of its members
working in defendant corporation Cebu Shipyard and
Engineering Works, Inc., 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.

Issue: Whether or not the decision of the CFI is valid

Decision/Ratio:
Yes. 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. 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. 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.
Labor unions in their campaign for membership would do
what lies in their power to put down competing groups. 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. The utmost care should
be taken then, since in displaying an unyielding,
intransigent attitude on behalf of their members, injustice
can be committed against opposing labor organizations.