I.

LABOR ORGANIZATION

A. Policy- 218 A(b) (c) (g); 218B; Book V Rule VI, Sec 1

B. Definition: Labor Organizations/Unions- 218 A(b) (c)(g); 219(g); 219(h); 219(i); 219(j);
Book V, Rule I, Sec 1 (cc) (ee, (ff), (zz) (ccc); (t); (i); DO 40-B. 03

1. Labor Organization- 219 (g); Book V, Rule I, Sec 1 (cc)

 Union- Book V, Rule I, Sec 1 (zz)

 Workers Association – Book V, Rule I, Sec 1

2. Legitimate labor organization – 219 (h); Book V, Rule I, Sec 1 (ee)

Legitimate workers’ associaton- Book V, Rule I, Sec 1 (ff)

3. Company Union – 219 (i); ULP – 259 (248) (d)

4. Exclusive bargaining representative- 219 (j); Book V, Rule I, Sec 1 (t)

5. Local Chapter – 241 (234-A) Note: Formerly referred to as chartered local

Book V, Rule I, Sec 1 (i); now Local Chapter per Art. 241 (234A)

C. Union Rationale

Valentin Guijarno plus 18 others v CIR & Central Santos Lopez Co., Inc. & USW Union –
ILO, 52 S 307 (73)

FACTS
 Three unfair labor practice cases for unlawful dismissal allegedly based on legitimate
union activity were filed against respondent Central Santos Lopez Co., Inc. and
respondent United Sugar Workers Union-ILO

 The company alleged that they had the right to dismiss the emloyees because
their dismissal was asked by the UNION by virtue of closed-shop provision under
their CBA which provides that those laborers who are no longer members of
good standing in the union may be dismissed by the respondent company if their
dismissal is sought by the union

 such kind of agreement is expressly allowed under the provisions of Republic Act
875 known as the Industrial Peace Act and the dismissal of complainants is
merely an exercise of a right allowed by said law."

The petitioners were found having been employed by the Company long before the
collective bargaining contract

In the decision of respondent Court, there was an acknowledgment of the prior

existence of such employment relationship. Nonetheless, the conclusion reached, both
by the trial judge and then by respondent Court en banc was that the dismissal was
justifiable under the closed-shop provision of the collective bargaining agreement.

ISSUES

Whether or not the closed-shop provision applies retroactively

RULING

1. The authoritative doctrine that a closed-shop provision in a collective bargaining

agreement is not to be given a retroactive effect so as to preclude its being applied
to employees already in the service.

"In order that an employer may be deemed bound, under a collective bargaining agreement, to
dismiss employees for non-union membership, the stipulation to this effect must be so clear
and unequivocal as to leave no room for doubt thereon. An undertaking of this nature is so
harsh that it must be strictly construed, and doubts must be resolved against the existence of
'closed shop'." (Confederated Sons of Labor v. Anakan Lumber Co.)

"The closed-shop agreement authorized under sec. 4, subsec. a(4) of the Industrial Peace Act
above quoted should however, apply to persons to be hired or to employees who are not yet
members of any labor organization. It is inapplicable to those already in the service who are
members of another union. To hold otherwise, i. e., that the employees in a company who are
members of a minority union may be compelled to disaffiliate from their union and join the
majority or contracting union, would render nugatory the right of all employees to self-
organization and to form, join or assist labor organizations of their own choosing, a right
guaranteed by the Industrial Peace Act (sec. 3, Rep. Act No. 875) as well as by the Constitution
(Art. III, sec. 1[6])." (Freeman Shirt Manufacturing Co., Inc. v. Court of Industrial Relations)

"generally, a state may not compel ordinary voluntary associations to admit thereto any given
individual, because membership -therein may be accorded or withheld as a matter of privilege,
the rule is qualified in respect of labor unions holding a monopoly in the supply of labor, either
in a given locality, or as regards a particular employer with which it has a closed-shop
agreement. * * *."

this Court looks with disfavor on a provision of this character being utilized as an excuse for the
termination of employment.

the controlling doctrine to which deference ought to have been paid was that petitioners
should not have been dismissed.

For, rightly has it been said that workers unorganized are weak; workers organized are
strong. Necessarily then, they join labor unions. To further increase the effectiveness of such
organizations, a closed-shop has been allowed. (MEANING OF CLOSED-SHOP)

It could happen, though, that such a stipulation which assures further weight to a labor union at
the bargaining table could be utilized against minority groups or individual members thereof.

There is no justification then, both as a matter of precedent and as a matter of principle, for the
decision reached by respondent Court.

2. Now as to the remedy to which petitioners are entitled. Clearly, they should be
reinstated with back pay.

D. Government Regulation: Implementing the Policy on Trade Unionism Const., Art III,Sec
16; Art 218 A(b)(c); Book V, Rule II, Sec 1; Rule VI, Sec 1

Electromat Manufacturing & Recording Corp. v Hon. Lagunzad, Nagkakaisang

Samahan ng Manggagawa ng Electromat- WASTO, GR 172699, 27 July 2011

FACTS

 Private Respondent applied for registration with BLR and submitted 11 supporting
documents

 It was granted pursuant to Department Order No. (D.O.) 40-03.

  (company) filed a petition for cancellation of the union’s registration certificate, for the
union’s failure to comply with Article 234 of the Labor Code.

o It argued that D.O. 40-03 is an unconstitutional diminution of the Labor Code’s

union registration requirements under Article 234.

The acting director of DOLE dismissed the petition.

The dismissal was affirmed by the BLR Director

 The company, on appeal, assailed the validity of D.O. 40-03 which amended the rules of
Book V (Labor Relations) of the Labor Code.

o since it reduced the requirements under Article 234 of the Labor Code.

the CA the petition and affirmed the assailed BLR ruling.

- D.O. 40-03 was issued by the DOLE pursuant to its rule-making power under the law.

The company moved for reconsideration, arguing that the union’s registration certificate was
invalid as there was no showing that WASTO, the labor federation to which the union is
affiliated, had at least ten (10) locals or chapters as required by D.O. 40-03.

The CA denied the motion, holding that no such requirement is found under the rules.

ISSUES

whether D.O. 40-03 is a valid exercise of the rule-making power of the DOLE.

RULING

YES. D.O. 40-03 represents an expression of the government’s implementing policy on trade
unionism. It builds upon the old rules by further simplifying the requirements for the
establishment of locals or chapters.

There is nothing contrary to the law or the Constitution in the adoption by the Secretary of
Labor and Employment of D.O. 40-03 as this department order is consistent with the intent of
the government to encourage the affiliation of a local union with a federation or national union
to enhance the local’s bargaining power.

The changes recognize the distinctions made in the law itself between federations and their
local chapters, and independent unions; local chapters seemingly have lesser requirements
because they and their members are deemed to be direct members of the federation to
which they are affiliated, which federations are the ones subject to the strict registration
requirements of the law.
the local union in the present case has more than satisfied the requirements the petitioner
complains about

1. Union Registration: Procedure

a. Requirements- 240 (234), (as amended by RA 9481, May 25, 2007; 241(234-A);
244(237); 242(235) [219(b)]; See: Book V, Rule III, Sec 2

i. 20% Membership requirement- 240 (234) ©

Takata (Phil) Corp. v BLR & SALAMAT, GR 196276, June 4, 2014

FACTS

The company filed with the DOLE a petition for cancellation of the Certificate of Union
registration of SALAMAT

- on the ground that the latter is guilty of misrepresentation, false statement and fraud
with respect to the number of those who participated in the organizational meeting

- only 68 attendees signed the attendance sheet, and which number comprised only 17%
of the total number of rank-and-file employees

- SALAMAT failed to comply with the 20% minimum membership requirement.

DOLE Regional Director, granted the petition for cancellation of respondent’s certificate of
registration. employees who attended the organizational meeting was obviously less than 20%
of the total number

The BLR reversed the decision of the DOLE RD as it found that the company failed to prove that
respondent deliberately and maliciously misrepresented the number of rank-and-file
employees.

the CA rendered its assailed decision which denied the petition and affirmed the decision of the
BLR

ISSUES

Whether or not the UNION’s registration should be cancelled

RULING

NO.

It does not appear in Article 234(b) of the Labor Code that the attendees in the organizational
meeting must comprise 20% of the employees in the bargaining unit.

Even Implementing Rules and Regulations of the Labor Code does not so provide.

under Article 234(c) the 20% minimum requirement pertains to the employees’ membership
in the union and not to the list of workers who participated in the organizational meeting.

the 68 attendees which comprised at least the majority of the 119 union members would
already constitute a quorum for the meeting to proceed and to validly ratify the Constitution
and By-laws of the union.

Petitioner claims that in the list of members, there was an employee whose name appeared
twice and another employee who was merely a project employee.

HOWEVER, 117 members which was still more than 20% of the 396 rank-and-file employees.

See: Mariwasa Siam Ceramics, Inc. v Secretary of Labor, GR 183317, Dec

21, 2009

FACTS

Mariwasa Siam Ceramics, Inc. filed a Petition for Cancellation of Union Registration against
respondent, claiming that the latter violated Article 234 of the Labor Code for not complying
with the 20% requirement

The DOLE RD granted the petition.

the BLR granted union’s appeal

ISSUES

Whether or not the union failed to comply with the 20% union membership requirement

RULING

There were 102 employees who allegedly executed affidavits recanting their union membership

these affidavits were written and prepared in advance, and the pro forma affidavits were ready
to be filled out with the employees’ names and signatures.
It was declaration that, in spite of his hesitation, the affiant was forced and deceived into
joining the respondent union.

however, the Court cannot give full credence to these affidavits, which were executed under
suspicious circumstances, and which contain allegations unsupported by evidence.

While it is true that the withdrawal of support may be considered as a resignation from the
union, the fact remains that at the time of the union’s application for registration, the affiants
were members of respondent and they comprised more than the required 20% membership for
purposes of registration as a labor union.

Article 234 of the Labor Code merely requires a 20% minimum membership during the
application for union registration. It does not mandate that a union must maintain the 20%
minimum membership requirement all throughout its existence.

the total union membership at the time of registration was 169 which is 32% of the total
number of rank-and-file employees

2. Registration Proceeding- Book V, Rule I, Sec 1(qq)

1st mode: issuance of union registration- 240 (234); 241 (234A), Book V, Rule III, Sec
2(A)

2nd mode: Union Affiliation- 241 (234A), Book V, Rule I, Sec 1(a); Rule III, Sec2€ as
amended

Note: Incorporated in the Labor code as Art 240A(234) (now 241) by RA 9481

a. Effect of affiliation with a National Union – 241(234A); RA 9481, Sec 8 (Art

255/245), Sec 9 (Art 256/245A)

Ergonomic Systems Phil. Inc. v Emerito Enaje plus 90 others, GR No. 195163,
Dec 13, 2017
FACTS

The local union entered into a CBA with ESPI which was valid for 5 years.

The local union, which was affiliated with the Federation, was not independently registered.

before the CBA expired, the union officers secured the independent registration of the local
union with the (DOLE).

the union officers were charged before the Federation and investigated for attending and
participating in other union’s seminars and activities using union leaves without the knowledge
and consent of the Federation and ESPI as well as in initiating and conspiring in the disaffiliation
before the freedom period.

The Federation rendered a decision finding the officers guilty of disloyalty and were penalized
with immediate expulsion.

ESPI notified the officers to explain but they refused to receive the same.

When ESPI submitted to the DOLE a list of dismissed employees, the local union file a notice of
strike

Because of these, the union members were issued letters of termination

Respondents filed a complaint for illegal dismissal and unfair labor practice against petitioners

the LA held that the local union was the real party-in-interest and the Federation was merely an
agent in the CBA; thus, the union officers and members who caused the implied disaffiliation
did not violate the union security clause. Consequently, their dismissal was unwarranted

the NLRC affirmed the ruling of the LA. It adjudged that the dismissal of the union officers was
effected only in response to the demand of the Federation and to comply with the union
security clause under the CBA.

CA affirmed with modification the NLRC’s ruling. It held that ESPI and the respondents acted in
good faith when the former dismissed the latter and when the latter, in turn, staged a strike
without complying with the legal requirements.

ISSUES

Whether the federation may invoke the union security clause in demanding the respondents’
dismissal;

RULING

Only the local union may invoke the union security clause in the CBA.
“Union security is a generic term, which is applied to and comprehends ‘closed shop,’ ‘union
shop,’ ‘maintenance of membership,’ or any other form of agreement which imposes upon
employees the obligation to acquire or retain union membership as a condition affecting
employment.

There is union shop when all new regular employees are required to join the union within a
certain period as a condition for their continued employment.

There is maintenance of membership shop when employees, who are union members as of the
effective date of the agreement, or who thereafter become members, must maintain union
membership as a condition for continued employment until they are promoted or transferred
out of the bargaining unit, or the agreement is terminated.

A closed shop, on the other hand, may be defined as an enterprise in which, by agreement
between the employer and his employees or their representatives, no person may be employed
in any or certain agreed departments of the enterprise unless he or she is, becomes, and, for
the duration of the agreement, remains a member in good standing of a union entirely
comprised of or of which the employees in interest are a part.”

Before an employer terminates an employee pursuant to the union security clause, it needs
to determine and prove that:

(1) the union security clause is applicable;

(2) the union is requesting the enforcement of the union security provision in the CBA; and

(3) there is sufficient evidence to support the decision of the union to expel the employee
from the union.

In this case, the primordial requisite, i.e., the union is requesting the enforcement of the union
security provision in the CBA, is clearly lacking.

Under the Labor Code, a chartered local union acquires legal personality through the charter
certificate issued by a duly registered federation or national union and reported to the Regional
Office.

It does not owe its existence to the federation with which it is affiliated. It is a separate and
distinct voluntary association owing its creation to the will of its members.

It only gives rise to a contract of agency, where the former acts in representation of the latter.
Hence, local unions are considered principals while the federation is deemed to be merely their
agent.
the CBA shows that the local union, not the Federation, was recognized as the sole and
exclusive collective bargaining agent for all its workers and employees in all matters concerning
wages, hours of work, and other terms and conditions of employment.

Therefore, only the union may invoke the union security clause in case any of its members
commits a violation thereof.

Even if the union was disloyal to the Federation, it did not give the Federation the prerogative
to demand the union officers’ dismissal pursuant to the union security clause

what the Federation could do is to refuse to recognize the local union as its affiliate and revoke
the charter certificate it issued to the latter

The sole essence of affiliation is to increase, by collective action, the common bargaining power
of local unions for the effective enhancement and protection of their interests.

Note: “…as separate and voluntary associations, local unions do not owe their
creatin and existence to the national federation to which they are affiliated but
to the will of their members. The sole essence of affiliation is to increase, by
collective action, the common bargaining power of local unions for the effective
enhancement and protection of their interests…” citing Phil. Skylanders, Inc. v
NLRC, 426 Phil 35(2002)

b. Action on Application/ BLR duty : not merely ministerial- 242 (235). 243(236);
Book V, Rule IV, Secs 4-7

Progressive Dev. Corp- Pizza Hut v Hon. Laguesma & NLM-Katipunan, 271 SCRA
593 (97)

FACTS

The Union filed a petition for certification election with the Department of Labor in behalf of
rank and file employees of Pizza Hut

Petitioner filed a motion to dismiss the petition alleging fraud, falsification and
misrepresentation in the respondent Union’s registration making it void and invalid. This
allegation was supported by documentary evidence
petitioner filed a Petition seeking the cancellation of the Union’s registration on the grounds of
fraud and falsification and a motion with the MedArbiter requesting suspension of proceedings
in the certification election case

However, MedArbiter directed the holding of a certification election

The appeal was denied by the Secretary of Labor

ISSUES

whether or not, after the necessary papers and documents have been filed by a labor
organization, recognition by the Bureau of Labor Relations merely becomes a ministerial
function.

RULING

NO

After a labor organization has filed the necessary papers and documents for registration, it
becomes mandatory for the Bureau of Labor Relations to check if the requirements under
Article 234 have been sedulously complied with. If its application for registration is vitiated by
falsification and serious irregularities, especially those appearing on the face of the application
and the supporting documents, a labor organization should be denied recognition as a
legitimate labor organization.

And if a certificate of recognition has been issued, the propriety of the labor organization’s
registration could be assailed directly through cancellation of registration proceedings in
accordance with Articles 238 and 239 of the Labor Code, or indirectly, by challenging its petition
for the issuance of an order for certification election

Furthermore, the Labor Code itself grants the Bureau of Labor Relations a period of thirty (30)
days within which to review all applications for registration under Article 235.

recognition of a labor union or labor organization is not merely a ministerial function, the
question now arises as to whether or not the public respondent committed grave abuse of
discretion in affirming the Med-Arbiter’s order in spite of the fact that the question of the
Union’s legitimacy was squarely put in issue and that the allegations of fraud and falsification
were adequately supported by documentary evidence.

The Labor Code requires that in organized and unorganized establishments, a petition for
certification election must be filed by a legitimate labor organization.

the grounds invoked by petitioner for the cancellation of respondent Union’s registration fall
under paragraphs (a) and (c) of Article 239 of the Labor Code.
The Med-Arbiter should have looked into the merits of the petition for cancellation before
issuing an order calling for certification election

Inasmuch as the legal personality of respondent Union had been seriously challenged, it
would have been more prudent for the Med-Arbiter and public respondent to have granted
petitioner’s request for the suspension of proceedings in the certification election case, until
the issue of the legality of the Union’s registration shall have been resolved.

c. Effect of Registration – Book V, Rule IV, Sec 8

Acquisition of Legal Personality/ Statutory Paradigm- 240 (234), 241(234A), Book

V, Rule III, Sec 2E as amended by DO-F-03 (October 30, 2008)

SMC Mandaue Packaging Products v Mandaue Packing Products; San Miguel

Monthlies RAF Union- FFW, GR 152356,, Aug 16, 2005

FACTS

Respondent, identifying itself as an affiliate of Federation of Free Workers (FFW), filed a

petition for certification election with the DOLE and attached documents to the petition

petitioner filed a motion to dismiss the petition for certification election on the sole ground that
herein respondent is not listed or included in the roster of legitimate labor organizations based
on the certification issued by the OIC, RD of the DOLE

respondednt submitted again the same documents stating that those were in compliance with
the requirements for the creation of a local/chapter pursuant to the Labor Code and its
Implementing Rules

the DOLE then certified that respondent has acquired legal personality as a labor
organization/worker’s association,

petitioner on its comment reiterated that respondent was not a legitimate labor organization at
the time of the filing of the petition

petitioner filed a petition to cancel the union registration of respondent. However, this petition
was denied, and such denial was subsequently affirmed by the Court of Appeals
med-arbiter dismissed respondent’s petition for certification election on the ground that on the
date of the filing of petition, respondent did not have the legal personality to file the said
petition for certification election.

DOLE Undersecretary rendered a Decision reversing the Order concluding that at the time of
the filing of petition for certification election, respondent acquired legal personality as it
submitted the required documents

ISSUES

Whether or not respondent acquired legal personality at the time of the filing of petition for
certification election

RULING

First Issue: On the Acquisition of Legal Personality by Respondent

The Labor Code itself does not lay down the procedure for the registration of a local or chapter
of a labor organization but provided instead in the Implementing Rules, particularly in Book V
thereof.

Amendments have been introduced to Book V, first by Department Order No. 9 which took
effect on 21 June 1997, and again by Department Order No. 40 dated 17 February 2003.

In the case, since the petition was filed in 1998, the Implementing Rules, as amended by
Department Order No. 9, should govern the resolution of this petition.

Section 3, Rule VI of Department Order No. 9 provides when the local/chapter acquires legal
personality.

Section 3. Acquisition of legal personality by local chapter.—A local/chapter constituted in

accordance with Section 1 of this Rule shall acquire legal personality from the date of filing of
the complete documents enumerated therein. Upon compliance with all the documentary
requirements, the Regional Office or Bureau shall issue in favor of the local/chapter a certificate
indicating that it is included in the roster of legitimate labor organizations.

the local/chapter acquires legal personality from the date of the filing of the complete
documentary requirements, and not from the issuance of a certification to such effect by the
Regional Office or Bureau.

On the other hand, a labor organization is deemed to have acquired legal personality only on
the date of issuance of its certificate of registration, which takes place only after the Bureau of
Labor Relations or its Regional Offices has undertaken an evaluation process lasting up until
thirty (30) days, within which period it approves or denies the application.
no such period of evaluation is provided in Department Order No. 9 for the application of a
local/chapter, and more importantly, under it such local/chapter is deemed to acquire legal
personality “from the date of filing” of the documents enumerated under Section 1, Rule VI,
Book V.

Parenthetically, under the present Implementing Rules as amended by Department Order No.
40, it appears that the local/chapter (or now, “chartered local”) acquires legal personality upon
the issuance of the charter certificate by the duly registered federation or national union. This
might signify that the creation of the chartered local is within the sole discretion of the
federation or national union and thus beyond the review or interference of the Bureau of Labor
Relations or its Regional Offices. However, Department Order No. 40 also requires that the
federation or national union report the creation of the chartered local to the Regional Office.

The Court considered it permissible for respondent to have submitted the required documents
itself to the Regional Office, and proper that respondent’s legal personality be deemed existent
as of filing of petition for certification election, the date the complete documents were
submitted.

d. Rights of Legitimate Labor Organization – 251 (242)

San Miguel Foods, Inc. – Cebu B-Meg Feed Plant v Hon. Laguesma & IBM, 263 S
90 (96)

FACTS

A petition for certification election among the monthly-paid employees petitioner was filed by
private respondent labor federation IBM, alleging that it is a legitimate labor organization duly
registered with the DOLE and that IBM has already complied with the mandatory requirements
for the creation of its local or affiliate in SMFI’s establishment.

Med-Arbiter Manit, this time, granted the second petition for certification election of private
respondent IBM

Petitioner SMFI appealed the foregoing Order to the Secretary of Labor and Employment
alleging that the MedArbiter erred in directing the conduct of certification election considering
that the local or chapter of IBM at SMFI is still not a legitimate labor organization with a right to
be certified as the exclusive bargaining agent in petitioner’s establishment

The undersecretary denied petitioner’s appeal

ISSUES

RULING

Petitioner asserted that IBM at SMFI is not a legitimate labor organization notwithstanding the
fact that it is a local or chapter of the IBM Federation under Article 234 of LC which stated that:
any labor organization shall acquire legal personality only upon the issuance of the Certificate
of Registration by the Bureau of Labor Relations.

Article 212(h) of the Labor Code defines a legitimate labor organization as “any labor
organization duly registered with the Department of Labor and Employment, and includes any
branch or local thereof.”

It is important to determine whether or not a particular labor organization is legitimate since

legitimate labor organizations have exclusive rights under the law which cannot be exercised by
non-legitimate unions, one of which is the right to be certified as the exclusive representative of
all the employees in an appropriate collective bargaining unit for purposes of collective
bargaining. (FOUND IN Article 242)

Article 242 of the Labor Code, to wit: “ART. 242. Rights of legitimate labor organizations.—A
legitimate labor organization shall have the right: (a) To act as the representative of its
members for the purpose of collective bargaining; (b) To be certified as the exclusive
representative of all the employees in an appropriate collective bargaining unit for purposes of
collective bargaining; (c) To be furnished by the employer, upon written request, with his
annual audited financial statements, including the balance sheet and the profit and loss
statement, within thirty (30) calendar days from the date of receipt of the request, after the
union has been duly recognized by the employer or certified as the sole and exclusive
bargaining representative of the employees in the bargaining unit, or within sixty (60) calendar
days before the expiration of the existing collective bargaining agreement, or during the
collective bargaining negotiation; (d) To own property, real or personal, for the use and benefit
of the labor organization and its members; (e) To sue and be sued in its registered name; and (f)
To undertake all other activities designed to benefit the organization and its members,
including cooperative, housing welfare and other projects not contrary to law. x x x x x x x x x.”

Ordinarily, a labor organization attains the status of legitimacy only upon the issuance in its
name of a Certificate of Registration by the Bureau of Labor Relations pursuant to Articles 234
and 235 of the Labor Code

When an unregistered union becomes a branch, local or chapter of a federation, some of the
aforementioned requirements for registration are no longer required.
A local or chapter need not be independently registered. By force of law (in this case, Article
212 [h]), such local or chapter becomes a legitimate labor organization upon compliance with
the provisions without having to be issued a Certificate of Registration in its favor by the BLR.

In this case, the undersecretary affirmed the finding of Med-arbiter that IBM at SMFI is a
legitimate labor organization supported by records.

Jerry Acedera, et al., v International Container Terminal Services, Inc. GR

146073, January 13, 2003

FACTS

The petitioners are employees of ICTSI and members of APCWU-ICTS, a duly registered labor
organization.  ICTSI entered into a five-year Collective Bargaining Agreement (CBA) with APCWU
which reduced the employees· work days from 304 to 250 days a year. ICTSI, however,
continued using the 304-day divisor in computing the wages of the employees

The RTWPB (Regional Tripartite Wage and Productivity Board) increased the daily wage in NCR.
The ICTSI then changed the divisor in computing the wages of the employees to 365 days even
if employees work only 5 days a week.

ICTSI went on a retrenchment program and laid off its on-call employees

The Union filed a notice to strike because of the retrenchment and the use of the 365 as divisor.

The dispute respecting the retrenchment was resolved by a compromise settlement while that
respecting the computation of wages was referred to the Labor Arbiter

APCWU, on behalf of its members and other employees similarly situated, filed with the Labor
Arbiter a complaint against ICTSI

petitioners-appellants filed with the Labor Arbiter a Complaint-in-Intervention with Motion to

Intervene

The LA: 250 as divisor, the Labor Arbiter denied petitionersappellants’ Complaint-in-
Intervention with Motion for Intervention upon a finding that they are already well represented
by APCWU.

On appeal, the NLRC reversed the decision of the Labor Arbiter and dismissed APCWU’s
complaint for lack of merit. The denial of petitioners-appellants’ intervention was, however,
affirmed.
The Court of Appeals dismissed APCWU’s petition. As for petitioners-appellants’ petition for
certiorari, it was dismissed by the Court of Appeals (It is clear from the records that herein
petitioners, claiming to be employees of respondent ICTSI, are already well represented by its
employees union, APCWU)

ISSUES

Whether or not petitioners’ intervention should have been granted

RULING

Petitioners-appellants, failed to consider, in addition to the rule on intervention, the rule on

representation,

Sec. 3. Representatives as parties.—Where the action is allowed to be prosecuted or defended

by a representative or someone acting in a fiduciary capacity, the beneficiary shall be included
in the title of the case and shall be deemed to be the real party in interest. A representative
may be a trustee of an express trust, a guardian, an executor or administrator, or a party
authorized by law or these Rules

A labor union is one such party authorized to represent its members under Article 242(a) of the
Labor Code which provides that a union may act as the representative of its members for the
purpose of collective bargaining..

It includes the power to represent its members for the purpose of enforcing the provisions of
the CBA

While a party acting in a representative capacity, such as a union, may be permitted to

intervene in a case, ordinarily, a person whose interests are already represented will not be
permitted to do the same except when there is a suggestion of fraud or collusion or that the
representative will not act in good faith for the protection of all interests represented by him.

The dismissal of the case does not, however, by itself show the existence of fraud or collusion
or a lack of good faith on the part of APCWU.

Petitioners-appellants likewise express their fear that APCWU would not prosecute the case
diligently because of its “sweetheart relationship” with ICTSI. 31 There is nothing on record,
however, to support this alleged relationship

e. Rights of Workers & Employers Organizations

 Minette Baptista, plus others v Rosario Villanueva and 15 other union
members, GR 194709, July 31, 2013

FACTS

Petitioners were former union members of Radio Philippines Network Employees Union
(RPNEU)

on suspicion of union mismanagement, petitioners, together with some other union members,
filed a complaint for impeachment of their union president before the executive board of RPN,
which was eventually abandoned.

They later re-lodged the impeachment complaint, this time, against all the union officers and
members of RPNEU before the DOLE

Thereafter, two (2) written complaints were filed against petitioners and several others for
alleged violation of the union’s Constitution and By-Laws.

(petitioners filed a suit calling for the impeachment of the officers and members of the
Executive Board of RPNEU without first resorting to internal remedies available under its own
Constitution and By-Laws.)

a different group of union members filed a third complaint against petitioners and 12 others,
before the Chairman of RPNEU’s Committee on Grievance and Investigation (the Committee)
based on commission of an act which violates RPNEU Constitution and By-Laws,

the RPNEU’s Board of Directors affirmed the recommendation of expulsion of petitoners and
the 12 others from union membership

RPNEU’s officers informed their company of the expulsion of petitioners and the 12 others from
the union and requested the management to serve them notices of termination from
employment in compliance with their CBA’s union security clause.

RPN HRD Manager informed petitioners and the 12 others of the termination of their
employment

petitioners filed complaints for ULP against the respondents questioning the legality of their
expulsion from the union and their subsequent termination from employment

the LA rendered a decision in favor of petitioners and ordered their reinstatement

the NLRC vacated and set aside the LA decision and dismissed the complaint for ULP

The CA sustained NLRC decision - the termination of employment by virtue of a union security
clause was recognized in our jurisdiction.
ISSUES

Whether or not the respondents committed ULP

RULING

NO.

Based on RPNEU’s Constitution and By-Laws, the charges against petitioners were not mere
internal squabbles, but violations that demand proper investigation because, if proven, would
constitute grounds for their expulsion from the union.

any supposed procedural flaw in the proceedings before the Committee was deemed cured
when petitioners were given the opportunity to be heard. Due process, as a constitutional
precept, is satisfied when a person was notified of the charge against him and was given an
opportunity to explain or defend himself.

Mere absence of a one-on-one confrontation between the petitioners and their complainants
does not automatically affect the validity of the proceedings before the Committee.

It is well-settled that 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.

In this case, RPNEU’s Constitution and By-Laws expressly mandate that before a party is
allowed to seek the intervention of the court, it is a pre-condition that he should have availed
of all the internal remedies within the organization.

Petitioners were found to have violated the provisions of the union’s Constitution and By-Laws
when they filed petitions for impeachment against their union officers and for audit before the
DOLE without first exhausting all internal remedies available within their organization.

This act is a ground for expulsion from union membership. Thus, petitioners’ expulsion from the
union was not a deliberate attempt to curtail or restrict their right to organize, but was
triggered by the commission of an act,

petitioners failed to discharge the burden required to prove the charge of ULP against the
respondents.

f. Effect of Non-Registration – Book V, Rule IV, Sec 8

 Eden Gladys Abaria, et al., v NLRC, Metro Cebu Comm. Hospital, the UCCP et
al., GR 154113 (Dec 7, 2011)

FACTS

(NFL) is the exclusive bargaining representative of the rank-and-file employees of MCCHI

NAMA-MCCH-NFL’s President expressed the union’s desire to renew the CBA, attaching to her
letter a statement of proposals signed/endorsed by 153 union members.

However, MCCHI returned the CBA proposal for the union President to secure first the
endorsement of the legal counsel of NFL as the official bargaining representative of MCCHI
employees.

The NFL legal counsel informed MCCHI that the proposed CBA submitted by the union
president was never referred to NFL and that NFL has not authorized any other legal counsel or
any person for collective bargaining negotiations.

he collection of union fees (check-off) was temporarily suspended by MCCHI in view of the
existing conflict between the federation and its local affiliate.

The union president and her group insisted that management directly negotiate with them for a
new CBA.

MCCHI referred the matter to NFL’s Regional Director, and advised Nava that their group is not
recognized by NFL.

The NFL’s RD suspended their union membership for serious violation of the Constitution and
By-Laws.

The union president and her group started a concerted activity around the MCCHI but the NFL
RD immediately disowned the concerted activities being carried out by union members which
are not sanctioned by NFL.

MCCHI directed the union members to explain on why they should not be terminated and
placed them under immediate preventive suspension issued certifications stating that there is
nothing in their records which shows that NAMA-MCCH-NFL is a registered labor organization,

Even the denial of their Notice to Strike, the union still pushed through as a group.

MCCHI sent termination letters to union leaders and other members who participated in the
strike and picketing activities
Because of these, the union held activities that adversely affectied hospital operations and the
condition of confined patients,

MCCHI filed a petition for injunction in the NLRC which was granted because of the union’s
illegal acts mentioned in Art. 264 of the Labor Code

several complaints for illegal dismissal and unfair labor practice were filed by the terminated
employees against respondents

LA: dismissed complaints for unfair labor practice

The DOLE

ISSUES

Whether or not MCCHI is guilty of unfair labor practice

RULING

MCCHI not guilty of unfair labor practice

Art. 248 (g) of the Labor Code, as amended, makes it an unfair labor practice for an employer
“[t]o violate the duty to bargain collectively” as prescribed by the Code.

“ART. 253. Duty to bargain collectively when there exists a collective bargaining agreement

NAMA-MCCH-NFL charged MCCHI with refusal to bargain collectively when the latter refused to
meet and convene for purposes of collective bargaining, or at least give a counter-proposal to
the proposed CBA the union had submitted and which was ratified by a majority of the union
membership.

MCCHI, on its part, deferred any negotiations until the local union’s dispute with the national
union federation (NFL) is resolved considering that the latter is the exclusive bargaining agent
which represented the rank-and-file hospital employees in CBA negotiations since 1987

Records of the NCMB and DOLE confirmed that NAMA-MCCH-NFL had not registered as a labor
organization, having submitted only its charter certificate as an affiliate or local chapter of NFL

Not being a legitimate labor organization, NAMA-MCCH-NFL is not entitled to those rights
granted to a legitimate labor organization under Art. 242:
“(a) To act as the representative of its members for the purpose of collective bargaining; (b) To
be certified as the exclusive representative of all the employees in an appropriate collective
bargaining unit for purposes of collective bargaining

NAMA-MCCH-NFL is not the labor organization certified or designated by the majority of the
rank-and-file hospital employees to represent them in the CBA negotiations but the NFL, as
evidenced by CBAs

While it is true that a local union has the right to disaffiliate from the national federation,
NAMA-MCCHNFL has not done so as there was no any effort on its part to comply with the legal
requisites for a valid disaffiliation during the “freedom period” through a majority vote in a
secret balloting in accordance with Art. 241 (d).

at the time of submission of said proposals, the NAMA-MCCH-NFL was not a duly registered
labor organization, hence it cannot legally represent MCCHI’s rank-and-file employees for
purposes of collective bargaining

even assuming that NAMA-MCCH-NFL had validly disaffiliated from its mother union, NFL, it still
did not possess the legal personality to enter into CBA negotiations

A local union which is not independently registered cannot, upon disaffiliation from the
federation, exercise the rights and privileges granted by law to legitimate labor organizations;
thus, it cannot file a petition for certification election.

the issue of disaffiliation is an intra-union dispute which must be resolved in a different forum
in an action at the instance of either or both the federation and the local union or a rival labor
organization, not the employer.

Hence, MCCHI’s refusal to bargain then with NAMA-MCCH-NFL cannot be considered an unfair
labor practice to justify the staging of the strike.

Strike and picketing activities conducted by union officers and members were illegal since they
were not a legitimate labor organization

Art. 264 (a) of the Labor Code, as amended, provides for the consequences of an illegal strike to
the participating workers

- an ordinary striking worker cannot be terminated for mere participation in an illegal

strike. There must be proof that he or she committed illegal acts during a strike
 - A union officer, on the other hand, may be terminated from work when he knowingly
participates in an illegal strike, and like other workers, when he commits an illegal act
during a strike.

there is no question that NAMA-MCCH-NFL officers knowingly participated in the illegal strike.

With respect to the dismissed union members, although MCCHI submitted photographs taken
at the picket line, it did not individually name those striking employees and specify the illegal
act committed by each of them.

Dismissed union members not entitled to backwages but should be awarded separation pay in
lieu of reinstatement to conform to the policy of a fair day’s wage for a fair day’s labor. (the
strike was illegal)

3. CANCELLATION OF UNION CERTIFICATE OF REGISTRATION – 245 (238), 246 (238A),

237 (239), Art 248 (239A), 250 (241)(j) last 2 par,; 256 (245A) (See RA 9481, May 25,
2007)

a. Effect of a petition for cancellation of union registration – 246 (238A)

Heritage Hotel Manila v Pinag-isang Galing at Lakas ng mga Manggagawa sa

Heritage Manila (PIGLAS-Heritage), GR 177024, Oct 30, 2009

FACTS

The company first had an old union called HHE formed by certain rank and file employees of
Petitioner Company.

Upon the HHE’s filing of petition for certification election, the company opposed the same on
the ground of misrepresentation.

When the case reached the Court of Appeals, it issued a writ of injunction against the holding of
the HHE union’s certification election, effective until the petition for cancellation of that union’s
registration shall have been resolved with finality. It became final when the HHE withdrew its
petition for review.

certain rank and file employees of Petitioner Company formed another union called PIGLAS.

PIGLAS applied for registration which was granted.

Two months after, the members of the first union adopted a resolution for its dissolution and
then filed a petition for cancellation of its union registration.

PIGLAS union filed a petition for certification election which was opposed also by the company,
alleging that the new union’s officers and members were also those who comprised the old
union.

Despite the company’s opposition, the Med-Arbiter granted the petition for certification
election

petitioner company filed a petition to cancel the union registration of respondent PIGLAS union

The company claimed that the documents submitted with the union’s application for
registration bore false information and charged the union with dual unionism

the DOLE-NCR denied the company’s petition to cancel respondent PIGLAS union’s registration

As for the charge of dual unionism, the same is not a ground for canceling registration. It merely
exposed a union member to a possible charge of disloyalty, an internal matter. Here, the
members of the former union simply exercised their right to self-organization and to the
freedom of association when they subsequently joined the PIGLAS union.

(BLR) affirmed the ruling of the DOLE-NCR. the union could not be accused of misrepresentation
since it did not pad its membership to secure registration. As for the issue of dual unionism, it
has become moot and academic, said the BLR, because of the dissolution of the old union and
the cancellation of its certificate of registration.

The CA dismissed the company’s petition

ISSUES

1. whether or not PIGLAS union commit fraud and misrepresentation in its application for union
registration

RULING

NO.

Except for the evident discrepancies as to the number of union members involved as these
appeared on the documents that supported the union’s application for registration, petitioner
company has no other evidence of the alleged misrepresentation.

The Labor Code and its implementing rules do not require that the number of members
appearing on the documents in question should completely dovetail. For as long as the
documents and signatures are shown to be genuine and regular and the constitution and by-
laws democratically ratified, the union is deemed to have complied with registration
requirements.

Labor laws are liberally construed in favor of labor especially if doing so would affirm its
constitutionally guaranteed right to self-organization.30 Here, the PIGLAS union’s supporting
documents reveal the unmistakable yearning of petitioner company’s rank and file employees
to organize. This yearning should not be frustrated by inconsequential technicalities.

The fact that some of respondent PIGLAS union’s members were also members of the old rank
and file union, the HHE union, is not a ground for canceling the new union’s registration. The
right of any person to join an organization also includes the right to leave that organization and
join another one. Besides, HHE union is dead. It had ceased to exist and its certificate of
registration had already been cancelled.

Heritage Hotel Manila v NUHWRAIN-HHMSC, GR 178296, January 12, 2011

FACTS

Respondent filed with the DOLE a ppetition for certifaication election which was granted by the
Med-Arbiter. On appeal, the DOLE Secretary affirmed the order of Med-Arbiter.

Subsequently, petitioner filed a Petition for Cancellation of Registration of respondent, on the

ground that respondent had failed to submit to the Bureau of Labor Relations (BLR) its annual
financial report for several years and the list of its members since it filed its registration papers

petitioner reiterated its request by filing a Motion to Dismiss or Suspend the [Certification
Election] Proceedings since the legitimacy of respondent is being challenged in the petition for
cancellation of registration

the certification election pushed through and respondent won but petitioner protested through
a petition

the respondents averred that it has already complied with the reportorial requirements, having
submitted its financial statements, its updated list of officers, and its list of members

the Med-Arbiter held that the pendency of a petition for cancellation of registration is not a bar
to the holding of a certification election.

Petitioner subsequently appealed the said Order to the DOLE Secretary but the same was
dismissed

The DOLE RD found that respondent had indeed failed to file financial reports and the list of its
members for several years, he, nonetheless, denied the petition, ratiocinating that freedom of
association and the employees’ right to self-organization are more substantive considerations
The DOLE Secretary dismissed the appeal holding that the constitutionally guaranteed freedom
of association and right of workers to self-organization outweighed respondent’s
noncompliance with the statutory requirements to maintain its status as a legitimate labor
organization.

The CA dismissed the petition and found that the DOLE Secretary did not commit grave abuse
of discretion when she affirmed the dismissal of the petition for cancellation of respondent’s
registration as a labor organization. The requirements of registration of labor organizations
should not be exploited to work against the workers’ constitutionally protected right to self-
organization.

ISSUES

Whether or not the registration of the Union should be cancelled

RULING

Petitioner also insists that respondent’s registration as a legitimate labor union should be
cancelled. that once it is determined that a ground enumerated in Article 239 of the Labor Code
is present, cancellation of registration should follow; it becomes the ministerial duty of the
Regional Director to cancel the registration of the labor organization, hence, the use of the
word “shall. that the Regional Director has admitted in its decision that respondent failed to
submit the required documents for a number of years; therefore, cancellation of its registration
should have followed as a matter of course.

Articles 238 and 239 of the Labor Code give the Regional Director ample discretion in dealing
with a petition for cancellation of a union’s registration, particularly, determining whether the
union still meets the requirements prescribed by law. It is sufficient to give the Regional
Director license to treat the late filing of required documents as sufficient compliance with the
requirements of the law.

the law requires the labor organization to submit the annual financial report and list of
members in order to verify if it is still viable and financially sustainable as an organization so as
to protect the employer and employees from fraudulent or fly-by-night unions. With the
submission of the required documents by respondent, the purpose of the law has been
achieved, though belatedly.

There was no grave abused of discretion by the RD and DOLE Secretary

The union members and, in fact, all the employees belonging to the appropriate bargaining unit
should not be deprived of a bargaining agent, merely because of the negligence of the union
officers who were responsible for the submission of the documents to the BLR.

the Labor Code’s provisions on cancellation of union registration and on reportorial

requirements have been recently amended by Republic Act (R.A.) No. 9481, and became
effective on June 14, 2007.
The amendment sought to strengthen the workers’ right to self-organization pertaining to the
non-dissolution of workers’ organizations by administrative authority

R.A. No. 9481 also inserted in the Labor Code Article 242-A:

Failure to comply with the above requirements shall not be a ground for cancellation of union
registration but shall subject the erring officers or members to suspension, expulsion from
membership, or any appropriate penalty.

b. Grounds for cancellation of union registration – 247- 248 (239, 239A)

De Ocampo Memorial School, Inc. v Bigkis Manggagawa, GR 192648, March

15, 2017

FACTS

A union registration number was s issued in favor of Bigkis Manggagawa sa De Ocampo

Memorial Medical Center-LAKAS (BMDOMMC).

Then Bigkis Manggagawa sa De Ocampo Memorial School, Inc. (BMDOMSI) was issued a Union
Registration/Certificate of Creation of Local Chapter number and declared a legitimate labor
organization.

De Ocampo filed a Petition for Cancellation of Certificate of Registration with the DOLE to
cancel the Certificate of Registration of BMDOMSI

De Ocampo filed a Supplemental Petition, informing the DOLE-NCR of the cancellation of the
Certificate of Registration of BMDOMMC

The DOLE ruled that BMDOMSI committed misrepresentation by making it appear that the
bargaining unit is composed of faculty and technical employees and the members of the union
do not share commonality of interest.

BMDOMSI then filed an appeal to the BLR alleging that the union members are all employees of
De Ocampo and that the bargaining unit it seeks to represent is appropriate.

the BLR reversed the Regional Director’s finding of misrepresentation, false statement or fraud
in BMDOMSI’s application for registration. According to the BLR, De Ocampo failed to adduce
proof to support its allegation of mixed membership within respondent union. The BLR also
held that the existence of an inappropriate bargaining unit would not necessarily result in the
cancellation of union registration, and the inclusion of a disqualified employee in a union is not
a ground for cancellation.

The CA affirmed the Decision of the BLR. It ruled that there was no misrepresentation, false
statement or fraud in the application for registration.

the CA further ruled that lack of mutuality and commonality of interest of the union members is
not among the grounds for cancellation of union registration under Article 239 of the Labor
Code.

ISSUES

Whether or not lack of mutuality and commonality of interest of the union members should be
among the grounds for cancellation of union registration

RULING

Article 247, previously Article 239 of the Labor Code35 provides: Art. 247. Grounds for
Cancellation of Union Registration.— The following may constitute grounds for cancellation of
union registration:

(a) Misrepresentation, false statement or fraud in connection with the adoption or ratification
of the constitution and bylaws or amendments thereto, the minutes of ratification, and the list
of members who took part in the ratification; (b) Misrepresentation, false statements or fraud
in connection with the election of officers, minutes of the election of officers, and the list of
voters; (c) Voluntary dissolution by the members.

For fraud and misrepresentation to constitute grounds for cancellation of union registration
under the Labor Code, the nature of the fraud and misrepresentation must be grave and
compelling enough to vitiate the consent of a majority of union members.

The Court agreed with the BLR and the CA that BMDOMSI did not commit fraud or
misrepresentation in its application for registration

The Court further held that no mutuality or commonality of interests among the members of
BMDOMSI, is not enough reason to cancel its registration.

The only grounds on which the cancellation of a union’s registration may be sought are those
found in Article 247 of the Labor Code.

The BLR and the CA’s finding that the members of BMDOMSI are rank-and-file employees is
supported by substantial evidence and is binding on this Court.46 On the other hand, other
than the allegation that BMDOMSI has the same set of officers with BMDOMMC and the
allegation of mixed membership of rank-and-file and managerial or supervisory employees, De
Ocampo has cited no other evidence of the alleged fraud and misrepresentation.
 See: Asian Institute of Management v AIM Faculty Assoc., GR No. 207971

January 23, 2017

FACTS

Respondent Asian Institute of Management Faculty Association (AFA) is a duly registered labor
organization composed of members of the Petitioner Asian Institute of Management AIM
faculty

respondent filed a petition for certification election6 seeking to represent a bargaining unit in
AIM. Petitioner opposed the petition, on the ground that members are managerial employees.

petitioner filed a petition for cancellation of respondent’s certificate of registration on the

grounds of misrepresentation in registration and that respondent is composed of managerial
employees who are prohibited from organizing as a union

, the Med-Arbiter denied the petition for certification election on the ground that AIM’s faculty
members are managerial employees.

The DOLE Secretary, on appeal, reversed the Med-Arbiter’s order and ordered the conduct of a
certification election

Meanwhile, the DOLE RD granted AIM’s petition for cancellation of respondent’s certificate of
registration

On appeal, the BLR reversed the same and ordered respondent’s retention in the roster of
legitimate labor organizations and held that the grounds relied upon in the petition for
cancellation are not among the grounds authorized under Article 239 of the Labor Code and
that respondent’s members are not managerial employees.

The SOLE granted the petition of AIM and ruled that (1) AFA’s members are managerial
employees; and (2) AFA is not a legitimate labor organization. Therefore, the AFA have no right
to file a petition for certification election.

CA ruled in favor of the AFA, violation of Article 245 will not result in the cancellation of the
certificate of registration of a labor organization

ISSUES

Whether or not violation of Article 245 will result in the cancellation of the certificate of
registration of a labor organization

RULING
In Holy Child Catholic School v. Hon. Sto. Tomas, this Court declared that “[i]n case of alleged
inclusion of disqualified employees in a union, the proper procedure for an employer like
petitioner is to directly file a petition for cancellation of the union’s certificate of registration
due to misrepresentation, false statement or fraud under the circumstances enumerated in
Article 239 of the Labor Code, as amended.”

petitioner was correct in filing a petition for cancellation of respondent’s certificate of

registration on the ground that the AFA violated Article 245 of the Labor Code which declares
that managerial employees are ineligible to join any labor organization — in a sense that
respondent is guilty of misrepresentation for registering under the claim that its members are
not managerial employees.

However, the issue of whether respondent’s members are managerial employees is still
pending. The resolution of this issue cannot be preempted; until it is determined with finality,
the petition for cancellation of respondent’s certificate of registration on the grounds alleged by
petitioner cannot be resolved.

See again: Takata Corp (Phil) v BLR & Salamat

the cancellation of union certificate of registration and the grounds under Articles 238 and 239
of the Labor Code.

Misrepresentation, false statement or fraud in connection with the adoption or ratification of

the constitution and by-laws or amendments thereto, the minutes of ratification, and the list of
members who took part in the ratification; (b) Misrepresentation, false statements or fraud in
connection with the election of officers, minutes of the election of officers, and the list of
voters; (c) Voluntary dissolution by the members.

Petitioner’s charge respondent on having misrepresented on the 20% requirement of the law as
to its membership.

HOWEVER, It does not appear in Article 234(b) of the Labor Code that the attendees in the
organizational meeting must comprise 20% of the employees in the bargaining unit. It is only
under Article 234(c) that requires the names of all its members comprising at least twenty
percent (20%) of all the employees in the bargaining unit where it seeks to operate.

There is no basis for petitioner to contend that grounds exist for the cancellation of
respondent’s union registration. For fraud and misrepresentation to be grounds for cancellation
of union registration under Article 239 of the Labor Code, the nature of the fraud and
misrepresentation must be grave and compelling enough to vitiate the consent of a majority of
union members.
 E. International Acitvities of Union – Prohibition and Regulation – 284-286 (269-271)

F. Union – Member Relations – 250 (241); 260 (249)(a)

UST Faculty Union Gil Gamilla (plus 21 others) v Hon. Bitonio & Edgardo Mariño plus
14 other respondents, GR 131235, Nov. 16, 1999

FACTS

Private Respondents are duly elected officers of the UST Faculty Union (USTFU).

The union has a subsisting five-year Collective Bargaining Agreement with its employer, the
University of Santo Tomas (UST) (expiration 1998)

Collantes, in her capacity as Secretary General of USTFU, posted a notice addressed to all
USTFU members announcing a general assembly to be held on 05 October 1996. Among others,
the general assembly was called to elect USTFU’s next set of officers. Through the notice, the
members were also informed of the constitution of a Committee on Elections (COMELEC) to
oversee the elections.

some of herein appellants filed a separate petition with the Med-Arbiter, directed against
herein appellees and the members of the COMELEC.

 the petition alleged that the COMELEC was not constituted in accordance with USTFU’s
constitution and by-laws (CBL) and

 that no rules had been issued to govern the conduct of the election.

The med-arbiter issued a temporary restraining order against herein appellees enjoining them
from conducting the election

There was a general faculty assembly held which was attended by the members of the union
and also by non-union members who] are members in good standing of the UST Academic
Community Collective Bargaining Unit.

During the assembly, appellants were elected as USTFU’s new set of officers by acclamation and
clapping of hands

The election happened because of the motion of one Atty. Lopez who was not a member of the
union and that the USTFU CBL and ‘the rules of the election be suspended
appellees filed the instant petition seeking injunctive reliefs and the nullification of the results
of that election and alleged that the holding of the same violated the temporary restraining
order and that non-union members were allowed to vote

appellants and UST allegedly entered into another CBA for 5 yrs from that year. (1996)

appellees again moved for the issuance of a temporary restraining order to prevent appellants
from making further representations

appellants claimed that the new CBA was purportedly ratified by an overwhelming majority of
UST’s academic community

For this reason, appellants moved for the dismissal of what it denominated as appellees’
petition for prohibition on the ground that this had become moot and academic

MED-Arbiter:

 the election was void for having been conducted in violation of the union’s Constitution
and By-laws

 rejected petitioners’ contention that it was a legitimate exercise of their right to self-
organization

 election could not be legitimized by the recognition of the newly “elected” set of officers
by UST or by the alleged ratification of the new CBA by the general membership of the
USTFU.

ISSUES

whether the public respondent committed grave abuse of discretion in refusing to recognize
the officers “elected”

RULING

NO. Petitioners fail to convince this Court that Director Bitonio gravely abused his discretion in
affirming the med-arbiter and in refusing to recognize the binding effect of the general
assembly called by the UST administration.

First Issue: Right to Self-Organization and Union Membership

The procedure for union membership is usually embodied in the union’s constitution and by-
laws. 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.

The petitioners could not justify the method they chose to impose their will on the union.
Article 3 of the ILO Convention No. 87 provides that

workers’ organizations shall have the right to draw up their constitution and rules and to
elect their representatives in full freedom, free from any interference from public
authorities. The freedom conferred by the provision is expansive; the responsibility
imposed on union members to respect the constitution and rules they themselves draw
up equally so. The point to be stressed is that the union’s CBL is the fundamental law
that governs the relationship between and among the members of the union

Union Election vs. Certification Election

A union election a certification election

 held pursuant to the union’s  the process of determining, through

constitution and by-laws, and the right
to vote in it is enjoyed only by union
members.
 an employee belonging to the
appropriate bargaining unit but who is
not a member of the union cannot
vote in the union election, unless
otherwise authorized by the
constitution and bylaws of the union.
secret ballot, the sole and exclusive
bargaining agent of the employees in
the appropriate bargaining unit, for
purposes of collective bargaining.
 the purpose of a certification election
is to ascertain whether or not a
majority of the employees wish to be
represented by a labor organization
and, in the affirmative case, by which
particular labor organization.

 all employees belonging to the

appropriate bargaining unit can vote.

In both elections, there are procedures to be followed.

Therefore, the election during the general assembly cannot be properly called a union election,
because the procedure laid down in the USTFU’s CBL for the election of officers was not
followed. It could not have been a certification election either, because representation was not
the issue, and the proper procedure for such election was not followed.

Second Issue: USTFU’s Constitution and By-Laws Violated

a union’s constitution and by-laws embody a covenant between a union and its members and
constitute the fundamental law governing the members’ rights and obligations.

The court agreed with eh med-arbiter that the election was tainted with irregularities because:
 1. The assembly was not called by the USTFU. 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, the assembly was not a union meeting. It was in fact a
gathering that was called and participated in by management and non-union members.

2. there was no commission on elections to oversee the election, as mandated by Sections

1 and 2 of Article IX of the USTFU’s CBL,

3. the purported election was not done by secret balloting, in violation of Section 6, Article
IX of the USTFU’s CBL, as well as Article 241 (c) of the Labor Code.

Third Issue: Suspension of USTFU’s CBL

Petitioners contend that the October 4, 1996 assembly “suspended” the union’s CBL.

NO.

1. the general faculty assembly was not the proper forum to conduct the election of USTFU
officers. Not all who attended the assembly were members of the union;

2. the grievances of the petitioners could have been brought up and resolved in
accordance with the procedure laid down by the union’s CBL and by the Labor Code

The ratification of the new CBA executed between the petitioners and the University of Santo
Tomas management did not validate the void October 4, 1996 election. Ratified were the terms
of the new CBA, not the issue of union leadership—

UST v Samahang Manggagawa ng UST, GR 169940, Sept 18, 2009

FACTS

RESPONDENT was the authorized bargaining agent of the nonacademic/non-teaching rank-and-

file daily- and monthly-paid employees of petitioner.

during formal negotiations for a new collective bargaining agreement, petitioner submitted its
“2001-2006 CBA Proposals”:salary increase, signing bonus, additional Christmas bonus

the parties agreed in principle on all non-economic provisions of the proposed CBA, except
those pertaining to Agency Contract or contractualization (Art. III, Sec. 3 of the proposed CBA),
Union Leave of the SMUST President (No. 4 of the Addendum to the proposed CBA), and hiring
preference.

petitioner submitted its final offer on the economic provisions which was higher
On the other hand, respondent reduced its demands but petitioner insisted on its final offer. As
a result, respondent declared a deadlock and filed a notice of strike

the DOLE Secretary timely assumed jurisdiction over the dispute

ISSUES

RULING

1. Admission and Discipline of Members – 260 (a) (249); Art 250 (241) (a)(e); 292 (277)
(a) (c)

See: RA 7637, September 22, 1992, which repealed RA 1700, the Anti-Subversion Act

Dolores Villar plus 8 others v Hon. Inciong, 121 S 444 (83)

FACTS

Petitioners were members of the Amigo Employees Union-PAFLU, a duly registered labor
organization which, at the time of the present dispute, was the existing bargaining agent of the
employees in the company

upon written authority of at least 30% of the employees in the company, including the
petitioners, the Federation of Unions of Rizal (hereinafter referred to as FUR) filed a petition for
certification election but was opposed by Philippine Association of Free Labor Unions
(hereinafter referred to as PAFLU)

PAFLU’s opposition cited the “Code of Ethics” governing interfederation disputes among and
between members of the Trade Unions Congress of the Philippines (hereinafter referred to as
TUCP). Consequently, the Med-Arbiter indorsed the case to TUCP for appropriate action but
before any such action could be taken thereon, the petitioners disauthorized FUR from
continuing the petition for certification election for which reason FUR withdrew the petition.

the same employees who had signed the petition filed by FUR signed a joint resolution

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

the Med-Arbiter dismissed the petition filed by herein petitioner Villar, which dismissal is still
pending appeal before the Bureau of Labor Relations

In the meantime, on February 14, 1977, the Amigo Employees Union-PAFLU called a special
meeting of its general membership. A Resolution was thereby unanimously approved which
called for the investigation by the PAFLU national president, pursuant to the constitution and
by-laws of the Federation, of all of the petitioners

ISSUES

The main thrust of the petition is the alleged illegality of the dismissal of the petitioners by
private respondent Company upon demand of PAFLU which invoked the security clause of the
collective bargaining agreement between the Company and the local union, Amigo Employees
Union-PAFLU.

RULING

the Company and the Amigo Employees Union-PAFLU entered into a Collective Bargaining
Agreement with a union security clause provided for in Article XII thereof which is a reiteration
of the same clause in the old CBA. The quoted stipulation for closed-shop is clear and
unequivocal and it leaves no room for doubt that the employer is bound, under the collective
bargaining agreement, to dismiss the employees, herein petitioners, for non-union
membership.

Petitioners became non-union members upon their expulsion from the general membership of
the Amigo Employees Union-PAFLU

PAFLU had the authority to investigate petitioners on the charges filed by their co-employees in
the local union and after finding them guilty as charged, to expel them from the roll of
membership of the Amigo Employees Union-PAFLU is clear under the constitution of the PAFLU
to which the local union was affiliated.

It is true that under the Implementing Rules and Regulations of the Labor Code, in case of intra-
union disputes, redress must first be sought within the organization itself in accordance with its
constitution and by-laws. However, it has been held that this requirement is not absolute but
yields to exception under varying circumstances.

Neither is there merit to petitioners’ contention that they had the right to present
representation issues within the 60-day freedom period. The petition was filed in the name of
the Amigo Employees Union which had not disaffiliated from PAFLU, the mother union.

Moreover, the Amigo Employees Union, as an independent union, is not duly registered as such
with the Bureau of Labor Relations.

Therefore, the act of petitioners cannot be considered a legitimate exercise of their right to
self-organization.

ALSO

the union security clause provided in the new CBA merely reproduced the union security
clause provided in the old CBA about to expire. And since petitioners were expelled from
Amigo Employees UnionPAFLU on March 28, 1982 upon denial of their Motion for
Reconsideration of the decision expelling them, the CBA of February 15, 1977 was already
applicable to their case.

See: Francisco Salunga v CIR, San Miguel Brewery Inc., & NABAILUP-PAFLU, 21 S
216 (67)

FACTS

Petitioner had been an employee of the Company, which entered with the Union, of which
respondent John de Castillo is the president, into a collective bargaining agreement:

The company agrees to require as a condition of employment of those workers that

they shall not voluntarily resign from the UNION earlier than thirty (30) days before the
expiry date of this agreement

Petitioner tendered his resignation from the union earlier than 30 days before the expiration of
the CBA. It was accepted by the unionand transmitted to the company
The Company informed him that his resignation would result in the termination of his
employment, petitioner wrote to the Union, a letter withdrawing or revoking his resignation
and advising the Union to continue deducting his monthly union dues. He also furnished a copy
of this communication to the Company.

The company notified the union that they consider petitioner as member of the union and
continue deducting his union dues.

the Union told the Company that petitioner’s membership could not be reinstated and insisted
on his separation from the service, based on the provision of the CBA

because of this, petitioner was dismissed from service.

petitioner had sought the intervention of PAFLU’s National President, respondent Cipriano Cid,
to which the Union was affiliated, for a review of the latter’s action..

The PAFLU gave due course to petitioner’s request “(a) for review and asked the Company, to
defer his dismissal, for at least two (2) weeks, so that its (PAFLU’s) Executive Board could act on
his appeal.

However, PAFLU had found no ground to review the action taken by the Union on the
expiration of the 15-day grace granted to him by the Company, the decision thereof to
terminate his services would take effect

At petitioner’s request a prosecutor of the Court of Industrial Relations commenced, therefore,

the present proceedings, for unfair labor practice, against respondents

Nevertheless, the case was dismissed.

ISSUES

Whether or not petitioner should be reinstated

RULING

The trial Judge found said refusal of the Union officers to be due to his critical attitude towards
certain measures taken or sanctioned by them. The petitioner had been criticizing and objecting
to what he believed were illegal or irregular disbursements of union funds,

the officers of the Union have, confirmed the fact that their refusal to allow the withdrawal of
petitioner’s resignation had been due to his aforementioned criticisms.

said officers tried to justify themselves by characterizing said criticisms as acts of disloyalty to
the Union
the criticism assailed, not the Union, but certain acts of its officers, and, indirectly, the officers
themselves, but also because the constitution and by-laws of the Union explicitly recognize the
right of its members to give their views on “all transactions made by the Union.”

As a consequence, the resolution appealed from cannot be affirmed without, in effect,

nullifying said right which, independently of the constitution and by-laws of the Union, is part
and parcel of the freedom of speech guaranteed in the Constitution of our Republic, as a
condition sine qua non to the sound growth and development of labor organizations and
democratic institutions.

A closed-shop provision would not justify the employer in discharging, or a union in insisting
upon the discharge of, an employee whom the union thus refuses to admit to membership,
without any reasonable ground therefor.

If union can admit new members, who have the requisite qualifications, with more reason may
the law and the courts exercise the coercive power when the employee involved is a long
standing union member, who, owing to provocations of union officers, was impelled to tender
his resignation, which he forthwith withdrew or revoked.

However, the Court ruled that the company is not guilty of ULP.

The Company was reluctant—if not unwilling to discharge the petitioner.

petitioner is entitled to reinstatement as member of the Union and to his former or

substantially equivalent position in the Company, without prejudice to his seniority and/or
rights and privileges, and with back pay, which back pay shall be borne exclusively by the Union.

a. Due Process

Paulino Bugay v Kapisanan ng mga Manggagawa sa MRR , 4 S 487 (62)

FACTS

appellant was formerly an auditor of the defendant union. He was at the same time payroll
clerk of the Manila Railroad Company.

he was requested by the secretary-treasurer of the company to deliver certain documents

which were in his possession belonging to the union and in compliance therewith he delivered
them without consulting the officers of the union.

Making use of these documents, the management of the company filed against Vicente K.
Olazo, president of the union, a charge for falsification of commercial document. Nonetheless,
after proper investigation, dismissed the charge
Charges for disloyalty and conduct unbecoming a union member were preferred against
appellant, and later the corresponding investigation, appellant was expelled from the union. As
a result, appellant filed a charge for unfair labor practice against the union

after due hearing, rendered decision holding that appellant's expulsion was illegal

Hence, the court ordered the reinstatement of appellant as union member and the restoration
to him of all his rights and privileges. This decision was affirmed by the Supreme Court.

Petitioner filed against respondent before the Court of First Instance of Manila an action for
moral damages arising out of an unfair labor practice allegedly committed by said union

The action for moral damages is based upon the allegation that "having become the victim of
an unfair labor practice act by the officers of the defendant under Republic Act 875

 moral damages for mental anguish, anxiety, social humiliation and besmirched
reputation specially among the thousands of employees of the Manila Railroad
Company

Defendant filed a motion to dismiss on the ground that the complaint does not state facts
sufficient to constitute a cause of action

that because the decisions of both the Court of Industrial Relations and the Supreme Court do
not contain any intimation nor statement to the effect that the charges filed against Paulino
Bugay which resulted in his separation from the union were "trumped up" or fabricated but
were solely based on procedural defects in the matter of his expulsion appellant cannot ask
moral damages inasmuch as there is no showing that to effect his expulsion the officers of the
union have acted in bad faith.

it is contended, he did not lose his employment as payroll clerk in the Manila Railroad Company
as a result of his expulsion, nor did he suffer any change in his status as a consequence thereof.
In effect, he was not awarded any damages by the industrial court.

ISSUES

Whether or not petitioner should be awarded moral damages

RULING

the main basis of appellant's action is his claim that because of the unfair labor practice
committed by the officers of defendant union as found by the Court of Industrial Relations and
the Supreme Court

he has suffered moral damages because of the mental anguish, anxiety, social humiliation and
besmirched reputation he has been subjected among the thousands of employees of the
Manila Railroad Company, which claim finds support in our new Civil Code. Thus, Article 2217 of
said Code

the fact remains that the two courts have found that his expulsion was illegal because of the
irregularities committed in his investigation.

In effect, it was found that not only has he not been given an opportunity to defend himself but
his expulsion was not submitted to the different chapters of the union as required by its
constitution and by-laws.

because of his expulsion he was subjected to humiliation and mental anguish with the
consequent lose of his good name and reputation.

It is, therefore, an error for the lower court to hold that the complaint does not state sufficient
cause of action for the relief claimed by appellant.

b. Distinguish between ground/s for disqualification from membership and

ground/s for removal from the union.

United Polyuresius, Inc. Ernesto Uy Soon v Marcelino Pinuela GR 209555, July

31, 2017

FACTS

Respondent was employed by UPI and eventually became elected President of the labor union
– PORFA.

There was an existing CBA between petitioner and the union, that The Company shall grant to
the Union the amount of Three Hundred Thousand Pesos (P300,000.00) free of interest as the
union’s capital for establishing a cooperative to meet the needs of its members. In the event of
nonpayment, all officers and members will be personally accountable.

The CBA likewise contained a union security clause which provided that employees who cease
to be PORFA’s members in good standing by reason of resignation or expulsion shall not be
retained in the employ of UPI.

Upon his assumption as union President, respondent wrote the former union President, to turn
over the records, papers, documents and financial statements of the union.

However, the bank account documents and the former president’s report did not match and
was not able to explain the discrepancies.
the union’s Executive Committee, which was headed by respondent, resolved to hire a certified
public accountant to conduct an audit of the union’s finances.

the accountant concluded that the union’s finances, income, and disbursements for the some
years were not properly documented, recorded, and reported.

during respondent’s term as PORFA President, it appeared that UPI automatically deducted
from the respective salaries of PORFA’s members amounts representing union membership
dues and loan payments

regularly turned over by UPI to PORFA in the form of fiftyeight (58) crossed checks, made
payable to PORFA.8 These amounts were then deposited and credited to PORFA’s account.

several days before the P300,000.00 loan by UPI to PORFA became due, petitioners,
respondent, and the other union officers met to discuss the proposed new CBA.

petitioners told respondent that until the loan is returned, the former shall not discuss the
proposed CBA. Respondent explained that the union did not have the finances

Petitioners then told respondent and the other union officers that if the amount is not
returned, the same will be deducted from the salaries of the union members.

Respondent filed a complaint against petitioner for refusing to bargain collectively but the
former raised the issue of non-payment of the loan.

Because of the recurring threat of failed CBA negotiations and salary deductions as means of
recovering the loan, union members began to demand the holding of a special election of union
officers. They likewise accused respondent and the other union officers of mismanagement,

special elections were held, and a new union President and set of officers were elected.

the union’s new set of officers conducted an investigation into the fact that the union had little
or no funds remaining in its bank account. Respondent attended the investigation, and
admitted that the union had no more funds as they were “utilized in the prosecution of cases
during his incumbency.” It was also discovered that the PORFA’s account had already been
closed.

The officers held that these violations constituted an infringement of the union’s Constitution,
particularly Article XV, Section 1, paragraphs (e) and (f) thereof, which specifically prohibit the
misappropriation of union funds and property and give ground for the impeachment and recall
of union officers.

PORFA communicated respondent’s expulsion from the union. petitioners issued a letter of
termination to respondent, to take effect immediately.
Respondent filed a complaint against petitioners before the Labor Arbiter for illegal dismissal,
with monetary claims and damages.

ISSUES

Whether or not respondent was illegally dismissed

RULING

YES.

Respondent’s expulsion from PORFA is grounded on Article XV, Section 1, paragraphs (e) and (f)
of the union’s Constitution,

e. Misappropriation of union funds and property. This is without prejudice to the filing
of an appropriate criminal or civil action against the responsible officer/(s) by any
interested party;

f. Willful violation of any provision of the constitution or rules, regulations, measures,

resolution(s) and decision of the union.

However, these provisions refer to impeachment and recall of union officers, and not expulsion
from union membership.

any officer found guilty of violating these provisions shall simply be removed, impeached or
recalled, from office, but not expelled or stripped of union membership

It was therefore error on the part of PORFA and petitioners to terminate respondent’s
employment based on provision of the union’s Constitution. Such a ground does not constitute
just cause for termination.

A review of the PORFA’s Constitution itself reveals that the only provision authorizing removal
from the union is, on the ground of failure to pay union dues, special assessments, fines, and
other mandatory charges.

On the other hand, grounds for disqualification from membership: a. Subversive or persons
who profess subversive ideas. b. Persons who have been convicted of crime involving moral
turpitude. c. Persons who are not employees of the company.

However, even if respondent was charged with estafa, a crime involving moral turpitude, still,
he has not been convicted of the crime. For this reason, he may not be disqualified as union
member

The matter of respondent’s alleged failure to return petitioners’ P300,000.00 which was lent to
PORFA is immaterial as well. It may not be used as a ground to terminate respondent’s
employment; under the Labor Code, such a contribution by petitioners to PORFA is illegal and
constitutes unfair labor practice.

ART. 248. Unfair labor practices of employers, assist, interfere, including the giving of financial
or other support to it or its organizers or supporters.

2. Election of Officers – 250 (241) (c)(f)(k); Book V, Rule XII

a. Qualifications/Disqualification- 250 (c)(f)

Atty. Allan S. Montano v Atty. Ernesto C. Verceles, GR No. 168583, July 26, 2010

FACTS

Petitioner worked as legal assistant of FFW Legal Center and joined the union of rank-and-file
employees, the FFW Staff Association, and eventually became the employees’ union president.
he was likewise designated officer-in-charge of FFW Legal Center.

Election of National Officers of FFW, Atty. Montaño was nominated for the position of National
Vice-President

However, the FFW COMELEC informed him that he is not qualified for the position as his
candidacy violates the FFW Constitution and By-Laws

He filed an Urgent Motion for Reconsideration10 praying that his name be included in the
official list of candidates

Despite the pending motion for reconsideration with the FFW COMELEC, and strong opposition
and protest of respondent, the convention delegates allowed Atty. Montaño’s candidacy. He
emerged victorious and was proclaimed as the National Vice-President

Respondent reiterated his preotest over the petitioner’s candidacy. Respondent as president of
an affiliate union of FFW filed before the BLR a petition13 for the nullification of the election of
petitioner as FFW-National VPres.

the BLR ruled that there were no grounds to hold Atty. Montaño unqualified to run

It held that the applicable provision in the FFW Constitution and By-Laws to determine whether
one is qualified to run for office is
The BLR opined that there was sufficient compliance with the requirements laid down by this
applicable provision and, besides, the convention delegates unanimously decided that Atty.
Montaño was qualified to run for the position of National Vice-President.

When the case was elevated to the CA, it ruled that petitioner did not possess the qualification
requirement under paragraph (d) of Section 26 that candidates must be an officer or member
of a legitimate labor organization. According to the CA, since petitioner, as legal assistant
employed by FFW, is considered as confidential employee, consequently, he is ineligible to join
FFW Staff Association, the rank-and-file union of FFW.

ISSUES

Whether or not petitioner is qualified to run as national vice president

RULING

The BLR has jurisdiction over intraunion disputes involving a federation

Section 226 of the Labor Code clearly provides that the BLR and the Regional Directors of DOLE
have concurrent jurisdiction over inter-union and intra-union disputes.

Such disputes include the conduct or nullification of election of union and workers’ association
officers.29 There is, thus, no doubt as to the BLR’s jurisdiction over the instant dispute involving
member-unions of a federation arising from disagreement over the provisions of the
federation’s constitution and by-laws.

The petition to annul Atty. Montaño’s election as VP was not prematurely filed.

It is true that under the Implementing Rules, redress must first be sought within the
organization itself in accordance with its constitution and by-laws. However, this requirement is
not absolute but yields to exception under varying circumstances

In the case, respondent made his protest during the plenary session before the holding of the
election proceedings.

The FFW COMELEC, still allowed petitioner’s candidacy and proclaimed him winner for the
position.

Under the rules, any protest left unresolved shall be resolved by the committee within five days
after the close of the election proceedings. A day or two after the election, respondent made
his written/formal protest

He exhausted the remedies under the constitution and by-laws to have his protest acted upon
by the proper forum and even asked for a formal hearing on the matter. Still, the FFW
COMELEC failed to timely act thereon.
He had no other recourse but to take the next available remedy so he properly sought redress
from the BLR so that the right to due process will not be violated.

There is necessity to resolve the case despite the issues having become moot.

Petitioner ran and won as FFW National President after his challenged term as FFW National
Vice-President had expired. the legitimacy of his leadership as National President is beyond the
Court’s jurisdiction and is not in issue in the instant case. The only issue is petitioner’s
qualification to run as FFW National Vice-President

Atty. Montaño is not qualified to run as FFW National Vice-President in view of the
prohibition established in Section 76, Article XIX of the 1998 FFW Constitution and By-Laws.

Section 76, Article XIX of the FFW Constitution and Bylaws provides that no member of the
Governing Board shall at the same time be an employee in the staff of the federation.

There is no dispute that Atty. Montaño, at the time of his nomination and election for the
position in the Governing Board,

Even after he was elected, albeit challenged, he continued to perform his functions as staff
member of FFW and no evidence was presented to show that he tendered his resignation.

On this basis, the FFW COMELEC disqualified Atty. Montaño. FFW COMELEC is vested with
authority and power, under the FFW Constitution and By-Laws, to screen candidates and
determine their qualifications and eligibility to run in the election and to adopt and promulgate
rules concerning the conduct of elections.

The Committee is also regarded as the final arbiter of all election protests. From the foregoing,
FFW COMELEC, undeniably, has sufficient authority to adopt its own interpretation of the
explicit provisions of the federation’s constitution and by-laws and unless it is shown to have
committed grave abuse of discretion, its decision and ruling will not be interfered with.

The Court held that petitioner is disqualified to run for the position of National Vice-President in
view of the proscription in the FFW Constitution and By-Laws on federation employees from
sitting in its Governing Board. Accordingly, the election of Atty. Montaño as FFW VicePresident
is null and void. 

b. Manner of Election- 250 (c)

i. Direct election

ii. Secret ballot

 c. Tenure – 250 (c)

d. Compensation – 250 (k)

e. Who may vote – 250 (c)

Eduardo Tancinco plus 7 others v Hon. Calleja, Edwin Lacanilao plus 5 others,
157 S 203 (88)

FACTS

Private respondents are the prime organizers of ITMMEA.

While THEY were preparing to file a petition for direct certification of the Union as the sole and
exclusive bargaining agent of ITM’s bargaining unit, the union’s Vice-President, was promoted
to the position of Department Head, thereby disqualifying him for union membership. Said
incident, among others led to a strike

Another group however, led by herein petitioners staged a strike inside the company premises.
After four (4) days the strike was settled

a pre-election conference was held, but the parties failed to agree on the list of voters

, a certain Mr. Cornelio A. Sy made a unilateral ruling excluding some 56 employees consisting
of the Manila office employees, members of Iglesia ni Kristo, non-time card employees, drivers
of Mrs. Salazar and the cooperative employees of Mrs. Salazar.

the election of officers was conducted under the supervision of MOLE wherein the 56
employees in question participated but whose votes were segregated without being counted.

Respondent’s group won with a margin of three (3) votes over Tancinco prompting petitioners
to make a protest.

Thereafter, petitioners filed a formal protest with the Ministry of Labor RO claiming that the
determination of the qualification of the 56 votes is beyond the competence of ANGLO.

Med-Arbiter directed the opening and counting of the segregated votes.

private respondents appealed to the Bureau of Labor Relations (BLR) justifying the
disenfranchisement of the 56 votes.

BLR held that the exclusion of the 56 employees as arbitrary, whimsical, and wanting in legal
basis but set aside the challenged order on the ground that 51 of 56 challenged voters were not
yet union members at the time of the election list submitted before the Bureau
The decision directed among others the proclamation of Lacanilao’s group as the duly elected
officers and for ITM-MEA to absorb in the bargaining unit the challenged voters unless proven
to be managerial employees.

ISSUES

Whether or not the

RULING

Submission of the employees names with the BLR as qualified members of the union is not a
condition sine qua non to enable said members to vote in the election of union’s officers. It
finds no support in fact and in law.

It is true that under Article 242(c) of the Labor Code, as amended, only members of the union
can participate in the election of union officers. The question however of eligibility to vote may
be determined through the use of the applicable payroll period and employee’s status during
the applicable payroll period.

In the case before Us, considering that none of the parties insisted on the use of the payroll
period-list as voting list and considering further that the 51 remaining employees were correctly
ruled to be qualified for membership, their act of joining the election by casting their votes on
May 26, 1986 after the May 10, 1986 agreement is a clear manifestation of their intention to
join the union. They must therefore be considered ipso facto members thereof.

Existence of a CBA and cordial relationship developed between the union and the management
should not be a justification to frustrate the decision of the union members as to who should
properly represent them in the bargaining unit. Neither may the inclusion and counting of the
56 segregated votes serve to disturb the existing relationship with management as feared by
herein private respondents.

Respondents themselves pointed out that petitioners joined the negotiating panel in the
recently concluded CBA.

Furthermore, the inclusion and counting of the 56 segregated votes would not necessarily
mean success in favor of herein petitioners as feared by private respondents herein.

Ricardo Manalad v Hon Trajano, Pablo Babula, 174 S 322 (89)

FACTS
The parties are members of rival groups in the Associated Port Checkers and Workers’ Union
(APCWU, for short) in United Dockhandlers, Inc.

the petitioners were disqualified from running as candidates in the election of APCWU officers
by the MedArbiter,

on appeal, said order was reversed, Thereafter, the election of officers and board members of
the union was held with the candidates of the petitioners winning over those of the private
respondents,

the latter group filed a petition for review with this Court assailing the order of the Bureau of
Labor Relations which had declared the petitioners eligible to run for said union offices.

the Court

DISMISSed the petition

DECLAREd VACANT all the offices of the Associated Port Checkers and Workers Union,

ORDERed that the petitioners and all other persons acting as officers of the said union,
to cease acting as such upon receipt of this resolution, and to turn over immediately the
management of the union affairs to respondent Director of the Bureau of Labor
Relations

ORDERed the holding of a special election of union officers under the supervision of the
National Capital Region Labor Office

a motion was filed by the petitioners with this asking that the private respondents be cited in
contempt and for their disqualification from running in the projected special election due to
their alleged refusal to comply with the Court’s resolution

Nevertheless, the scheduled special election was held resulting in the victory of the candidates
of the private respondents. Petitioner then filed a motion with the Court for the annulment of
the special election, repeating their allegation that there was non-compliance with the Court’s
resolution of July 3, 1985 by private respondents.

respondent Director issued a resolution proclaiming private respondents as the winners in the
special election and duly elected officers of the union

In the meantime, the Court denied the motion of the petitioner to annul the special election

Meanwhile, the three-year term of the private respondents under the disputed elections
expired

petitioners filed a motion to restrain the holding of a new election of officers of the union
scheduled on November 28, 1988. However, before any action could be taken on said motion
the election was held as scheduled, hence the petitioner filed a motion, dated December 1,
1988, to annul said election.

ISSUES

Whether or not the case should be rendered moot and academic

RULING

YES. It is pointless and unrealistic to insist on annulling an election of officers whose terms had
already expired. We would have thereby a judgment on a matter which cannot have any
practical legal effect upon a controversy, even if existing, 18 and which, in the nature of things,
cannot be enforced. We must consequently abide by our consistent ruling that where certain
events or circumstances have taken place during the pendency of the case which would render
the case moot and academic, the petition should be dismissed.

disobedience to a resolution of this Court should not be left unpunished. However, before the
alleged disobedient party may be cited for contempt, the allegations against him should be
clearly established. The contentions of petitioners, even disregarding some evidential
deficiencies, do not adequately establish the basis for contempt. On the contrary, respondents
have satisfactorily answered the averments thereon.

even if the disqualification of private respondents could be justified, the candidates of

petitioners certainly cannot be declared as the winners in the disputed election. The mere fact
that they obtained the second highest number of votes does not mean that they will thereby be
considered as the elected officers if the true winners are disqualified.

See: Kapisanan v Hon Trajano, Catalino Silvestre 134 S 236 (85)

FACTS

a written request for accounts examination of the financial status of the Kapisanan ng
Manggagawang Pinagyakap (KMP) Labor Union (Union for brevity), the existing labor union at
Franklin Baker Company was filed by private respondent Silvestre and thirteen (13) other
employees, who are also members of the said Union.

Union Account Examiner Florencio R. Vicedo of the Ministry of Labor and Employment
conducted the necessary investigation

Based on the foregoing revelations, private respondents filed a petition for the expulsion of the
union officers on the ground that they committed gross violation of the Labor Code, specifically
paragraphs (a), (b), (g), (h), (j) and (k) of Article 242; and, the constitution and by-laws of the
Union, particularly the provisions of Sections 6 and 7 thereof.
Med-Arbiter ordered the holding of a referendum, to be conducted under the supervision of
the Bureau of Labor Relations, to decide on the issue of whether to expel or suspend the union
officers from their respective positions.

Petitioners appealed the said order of Med-Arbiter Cabibihan to herein public respondent
Director Trajano of the Bureau of Labor Relations, claiming that the same is not in accordance
with the facts contained in the records and is contrary to law.

Private respondents, on the other hand, claimed that the Med-Arbiter erred in calling a
referendum to decide the issue. They reiterated that the appropriate action should be the
expulsion of the herein union officers.

, public respondent Director Trajano dismissed both appeals of petitioners and private
respondents and affirmed in toto the order of Med-Arbiter Cabibihan.

Petitioners informed public respondent that in the general election held on October 4, 1982, all
of them, except petitioners Ambrocio dela Cruz and Eliseo Celerio, were elected by the
overwhelming majority of the members, while private respondents Catalino Silvestre and Cesar
Alfaro lost. Thereafter, they moved for the dismissal of the appeal for having been rendered
moot and academic by their re-election.

ISSUES

RULING

By and large, the holding of the referendum in question has become moot and academic. This
is in line with Our ruling in Pascual vs. Provincial Board of Nueva Ecija,

“The Court should never remove a public officer for acts done prior to his present term
of office. To do otherwise would be to deprive the people of their right to elect their
officers. When the people have elected a man to office, it must be assumed that they
did this with knowledge of his life and character, and that they disregarded or forgave
his faults or misconduct, if he had been guilty of any. It is not for the court, by reason of
such faults or misconduct to practically overrule the will of the people

f. Shop Steward

Teodorico Miranda, Jr v Asian Terminals, Inc. GR 174316; June 23, 2009

FACTS
Petitioner Teodorico S. Miranda, Jr. was employed by respondent ATI in 1991 as Checker I. He
also became a member of the Associated Port Checkers and Workers Union (APCWU or the
union).

the petitioner, who was then the Vice President of the union, was appointed to the position of
Shop Steward which is a union position under the payroll of the company.5 The Collective
Bargaining Agreement (CBA) between the union and ATI provided for the appointment of a
Shop Steward from among the union members, upon the recommendation of the union
president.

The Shop Steward is a field representative of both the company and the union and acts as an
independent arbiter of all complaints brought to his attention

the President of APCWU, wrote a letter7 to the petitioner regarding the recall of his designation
as the union Shop Steward. The union president explained that the petitioner was recalled as
union Shop Steward due to loss of trust and confidence in him, pursuant to the “Agreement
Amending the MPSI (Marina Port Services, Inc.)-APCWU CBA.”

The letter further stated that the petitioner refused to heed the union president’s
reminders concerning his “chronic absenteeism” that “is hurting the interest of the
Union members as they are left with no responsible union officer when summoned for
investigation concerning alleged infractions of company rules.”

the decision to dismiss the petitioner came only after a series of personal dialogues and after
the petitioner had been given ample opportunity to efficiently perform the duties and
obligations of a Shop Steward assigned to the night shift. The union president then gave the
petitioner five days from receipt of the letter to explain why he should not be recalled as Shop
Steward for chronic absenteeism

A rift then developed between the union leadership and certain union members, including the
petitioner. This led to the formation of a grievance committee to investigate the complaints
against the union officers, including the petitioner. The petitioner, however, refused to
participate in the investigation.

the grievance committee issued its report recommending to ATI the recall of the petitioner as
Shop Steward and for his reversion to his former position of Checker I, in accordance with the
CBA.

The petitioner questioned his recall as union Shop Steward, and the union president reasoned
that the petitioner’s recall as Shop Steward was the term of office of the Shop Steward shall be
based on trust and confidence and favorable recommendation of the duly elected president of
the Union

Acting on the recommendation of the union, respondent ATI issued a Memorandum13 to the
petitioner regarding his transfer
The Med-Arbiter found that the union president did not have the authority to recall the
petitioner as Shop Steward for lack of approval of the Board of Directors of the union. The
Order of the Med-Arbiter was affirmed by the Secretary of Labor

it is not the union president who makes the appointment. The union president merely
recommends. recall of appointments likewise requires the imprimatur of the Board.

ISSUES

Whether or not petitioner should be reinstated as a Shop Steward

whether the case has been rendered moot and academic.

RULING

Union Shop Steward: A position within the union

A shop steward is appointed by the union in a shop, department, or plant and serves as
representative of the union, charged with negotiating and adjustment of grievances of
employees with the supervisor of the employer.

He is the representative of the union members in a building or other workplace. His duties
include collection of dues, recruitment of new members and initial negotiations for the
settlement of grievances.

even in Section 2 of Rule XIX of the Implementing Rules of Book V of the Labor Code, as
amended by DOLE Order 40-03, the shop steward is understood to be a union officer who plays
an important role in the grievance procedure.

He is responsible for receiving complaints and grievances of the employees and for bringing
these complaints to the immediate supervisor of the employee concerned. If the grievance is
not settled through the efforts of the shop steward, it is referred to the grievance committee.

Intra-union Dispute

Since the Shop Steward is a union position, the controversy surrounding his recall from his
position as Shop Steward becomes a dispute within the union.

An “Internal Union Dispute” or intra-union conflict refers to a conflict within or inside a labor
union.

Article 226 of the Labor Code of the Philippines vests on the Bureau of Labor Relations and the
Labor Relations Division jurisdiction to act on all inter-union or intra-union conflicts.

The actions of the petitioner bolster the conclusion that his grievances were directed against
the union and not the respondent company, making the dispute an intra-union dispute. The
first Complaints filed by the petitioner were against the union and the Union President for
illegal recall of his designation as Shop Steward.

A Complaint was then filed before the DOLE Med-Arbiter praying for reinstatement to union
Shop Steward and for the award of the salary differential while he was allegedly illegally
demoted.

But the money claims could not be brought before the union since the salaries of the petitioner
were paid by the respondent company; thus, a Complaint for illegal demotion amounting to
constructive dismissal was filed before the Labor Arbiter, against the union, union president
and this time including respondent company and the president of the company.

Ruling of the Med-Arbiter Prevails: Invalid Recall

The Med-Arbiter, as affirmed by the Secretary of Labor, ruled that there was neither cause nor
due process in the recall of the petitioner from the position of union Shop Steward. He found
that the claim of loss of trust and confidence due to the petitioner’s alleged absenteeism was
not substantiated and that the recall was not approved by the Board of Directors of the union,
as required by the APCWU Constitution and By-Laws

The Labor Arbiter’s decision is void for want of jurisdiction

The Labor Arbiter incorrectly assumed jurisdiction over the case due to his confused
understanding of the relationship between and among the petitioner, respondent company and
the union and his decision on the merits of the case is void for lack of jurisdiction.

The respondent cannot and should not conduct its own investigation to determine whether the
union had cause to recall the petitioner from union Shop Steward because the dispute is an
intra-union dispute.

Petitioner cannot be reinstated to Shop Steward due to his valid retrenchment

The petitioner could not be reinstated to the position of Shop Steward because his eventual
separation from respondent ATI made reinstatement unfeasible. Employment with respondent
ATI and membership in the union are required in order to occupy the position of Shop Steward.
But the petitioner is neither a member of the union nor employed with respondent ATI. He was
already retrenched from respondent ATI and his retrenchment was finally settled through the
execution of a Quit Claim and Release

The petitioner cannot also be reinstated to the position of Checker I, since he was already
retrenched by the respondent from such position and he released the company from any and
all claims with respect to his retrenchment.

The events which have taken place during the pendency of the case have rendered the present
petition moot and academic.
 See: Sta Rosa Coca-Cola Plant Employees Union v CCBP, GR 164302-03, January
24, 2007

FACTS

ISSUES

(a) whether the September 21, 1999 mass action staged by the Union was a strike; (b) if, in the
affirmative, whether it was legal; and (c) whether the individual officers and shop stewards of
petitioner Union should be dismissed from their employment.

RULING

The ruling of the CA that petitioners staged a strike and not merely a picket is correct.

Petitioners failed to establish that the NLRC committed grave abuse of its discretion amounting
to excess or lack of jurisdiction in affirming the findings of the Labor Arbiter that petitioners had
indeed staged a strike. Article 212(o) of the Labor Code defines strike as a temporary stoppage
of work by the concerted action of employees as a result of an industrial or labor dispute.

The term “strike” encompasses not only concerted work stoppages, but also slowdowns, mass
leaves, sit-downs, attempts to damage destroy or sabotage plant equipment and facilities, and
similar activities.

Petitioners notified the respondent of their intention to stage a strike, and not merely to picket.
Petitioners’ insistence to stage a strike is evident in the fact that an amended notice to strike
was filed even as respondent moved to dismiss the first notice.

The basic elements of a strike are present in this case:

members of petitioner Union, whose respective applications for leave of absence on September
21, 1999 were disapproved, opted not to report for work on said date, and gathered in front of
the company premises to hold a mass protest action. Petitioners deliberately absented
themselves and instead wore red ribbons, carried placards with slogans. They marched to and
fro in front of the company’s premises during working hours. Thus, petitioners engaged in a
concerted activity which already affected the company’s operations. The mass concerted
activity constituted a strike

petitioners totally ignored the statutory requirements and embarked on their illegal strike.
On the second and third issues, the ruling of the CA affirming the decisions of the NLRC and the
Labor Arbiter ordering the dismissal of the petitioners-officers, directors and shop stewards of
petitioner Union is correct.

A worker merely participating in an illegal strike may not be terminated from employment. It is
only when he commits illegal acts during a strike that he may be declared to have lost
employment status. For knowingly participating in an illegal strike or participates in the
commission of illegal acts during a strike, the law provides that a union officer may be
terminated from employment. The employer possesses the right and prerogative to terminate
the union officers from service.

Finally, the contention of petitioners Elenette Moises, Almira Romo, Louie Labayani, Ricky
Ganarial, Efren Galan and Jun Carmelito Santos who were appointed as shop stewards of the
Union that they were mere members and not the officers of petitioner Union is barren of merit.

A shop steward is appointed by the Union in a shop, department, or plant serves as

representative of the Union, charged with negotiating and adjustment of grievances of
employees with the supervisor of the employer. 55 He is the representative of the Union
members in a building or other workplace. Black’s Law Dictionary defines a shop steward as a
union official who represents members in a particular department. His duties include the
conduct of initial negotiations for settlement of grievances. 56 He is to help other members
when they have concerns with the employer or other work-related issues. He is the first person
that workers turn to for assistance or information. If someone has a problem at work, the
steward will help them sort it out or, if necessary, help them file a complaint. 57 In the
performance of his duties, he has to take cognizance of and resolve, in the first instance, the
grievances of the members of the Union. He is empowered to decide for himself whether the
grievance or complaint of a member of the petitioner Union is valid, and if valid, to resolve the
same with the supervisor failing which, the matter would be elevated to the Grievance
Committee.

It is quite clear that the jurisdiction of shop stewards and the supervisors includes the
determination of the issues arising from the interpretation or even implementation of a
provision of the CBA, or from any order or memorandum, circular or assignments issued by the
appropriate authority in the establishment. In fine, they are part and parcel of the continuous
process of grievance resolution designed to preserve and maintain peace among the employees
and their employer. They occupy positions of trust and laden with awesome responsibilities.

In this case, instead of playing the role of “peacemakers” and grievance solvers, the petitioners-
shop stewards participated in the strike. Thus, like the officers and directors of petitioner Union
who joined the strike, petitioners-shop stewards also deserve the penalty of dismissal from
their employment.
 3. Major Policy Matter- 250 (241) (d)

Fortunato Halili v CIR, Halili Bus Drivers & Conductors Union, 136 S 112 (85)

FACTS

ISSUES

RULING

When Atty. Pineda rejoined the Espinas firm in 1968, he did not reveal to his partners (he was made the
most senior partner) that he had a retainer’s contract entered into on January 1, 1967 which allegedly
took effect in 1966. He stayed with the law firm until 1974 and still did not divulge the 1967 retainer’s
contract. Only the officers of the Union knew of the contract.

The alleged retainer’s contract between Atty. Pineda and the Union appears anomalous and even illegal
as well as unethical considering that—

1. The contract was executed only between Atty. Pineda and the officers of the Union chosen by
about 125 members only. It was not a contract with the general membership. Only 14% of the
total membership of 897 was represented. This violates Article 242 (d) of the Labor Code which
provides:
“The members shall determine by secret ballot, after due deliberation, any question of
major policy affecting the entire membership of the organization, unless the nature of
the organization or force majeure renders such secret ballot impractical, in which case
the board of directors of the organization may make the decision in behalf of the
general membership” (emphasis supplied).

The amount of P101,856.00 which Atty. Pineda donated to the Union and which actually
corresponds to 5% of the total 35% attorney’s fees taken from the proceeds (p. 263, L-24864,
rec.) appears improper since it amounts to a rebate or commission. This amount was
subsequently treated as union miscellaneous operating expenses without the consent of the
general membership.

See again: Eden Gladys Abaria, et al., v NLRC, Metro Cebu Comm. Hospital, GR
154113, Dec 7, 2011
 See: National Union of Bank Employees (NUBE) v Philnabank Employees
Association (PEMA) and PNB, GR 174287, Aug 12, 2013

FACTS

(PNB) used to be a government-owned and controlled banking institution. The 1986 Revised
Charter of the Philippine National Bank). Its rank-and-file employees, being government
personnel, were represented for collective negotiation by the Philnabank Employees
Association (PEMA), a public sector union.

the Securities and Exchange Commission approved PNB’s new Articles of Incorporation and By-
laws and its changed status as a private corporation. PEMA affiliated with petitioner National
Union of Bank Employees (NUBE), which is a labor federation composed of unions in the
banking industry, adopting the name NUBE-PNB Employees Chapter

the Securities and Exchange Commission approved PNB’s new Articles of Incorporation and By-
laws and its changed status as a private corporation. PEMA affiliated with petitioner National
Union of Bank Employees (NUBE), which is a labor federation composed of unions in the
banking industry, adopting the name NUBE-PNB Employees Chapter

ISSUES

whether PEMA validly disaffiliated itself from NUBE, the resolution of which, in turn, inevitably
affects the latter’s right to collect the union dues held in trust by PNB.

RULING

The right of the local union to exercise the right to disaffiliate from its mother union is well
settled in this jurisdiction.

Cirtek Employees Labor Union-Federation of Free Workers v. Cirtek Electronics, Inc.:

[A] local union may disaffiliate at any time from its mother federation, absent any
showing that the same is prohibited under its constitution or rule. Such, however, does
not result in it losing its legal personality altogether.

A local labor union is a separate and distinct unit

A local union does not owe its existence to the federation with which it is affiliated.

The mere act of affiliation does not divest the local union of its own personality, neither
does it give the mother federation the license to act independently of the local union. It
only gives rise to a contract of agency where the former acts in representation of the
latter.
The mere act of affiliation does not divest the local union of its own personality, neither does it
give the mother federation the license to act independently of the local union. It only gives rise
to a contract of agency where the former acts in representation of the latter.

Also, there is no merit on NUBE’s contention that PEMA’s disaffiliation is invalid for non-
observance of the procedure that union members should make such determination through
secret ballot and after due deliberation, conformably with Article 241 (d) of the Labor Code, as
amended.

Art. 241. Rights and conditions of membership in a labor organization.

d. The members shall determine by secret ballot, after due deliberation, any question of
major policy affecting the entire membership of the organization, unless the nature of
the organization or force majeure renders such secret ballot impractical, in which case,
the board of directors of the organization may make the decision in behalf of the
general membership;

Granting, for argument’s sake, that Article 241 (d) is applicable, still, We uphold PEMA’s
disaffiliation from NUBE.

First, noncompliance with the procedure on disaffiliation, being premised on purely

technical grounds cannot rise above the employees’ fundamental right to
selforganization and to form and join labor organizations of their own choosing for the
purpose of collective bargaining.

Second, the Article nonetheless provides that when the nature of the organization
renders such secret ballot impractical, the union officers may make the decision in
behalf of the general membership.

“PNB employees, from where [PEMA] [derives] its membership, are scattered from
Aparri to Jolo, manning more than 300 branches in various towns and cities of the
country, “[to] gather the general membership of the union in a general membership
to vote through secret balloting is virtually impossible.”

Third, and most importantly, NUBE did not dispute the existence of the persons or their
due execution of the document showing their unequivocal support for the disaffiliation
of PEMA from NUBE.

Consequently, by PEMA’s valid disaffiliation from NUBE, the vinculum that previously bound the
two entities was completely severed. As NUBE was divested of any and all power to act in
representation of PEMA, any act performed by the former that affects the interests and affairs
of the latter, including the supposed expulsion of Serrana et al., is rendered without force and
effect

Also, in effect, NUBE loses it right to collect all union dues held in its trust by PNB.
On the other hand, it was entirely reasonable for PNB to enter into a CBA with PEMA as
represented by Serrana et al. Since PEMA had validly separated itself from NUBE, there would
be no restrictions which could validly hinder it from collectively bargaining with PNB.

4. Union Funds- 250 (241) (a,b,c,g,h,I,j,k,l,m,n,o); 280(265); Book V, Rule XIII

a. Payment of Attorneys Fees- Art 288(222)(b) , Art 250 (241) (g,h,m,no)

Pacific Banking Corporation v Hon. Clave & Juanito Saavedra, 128 S 112 (84)

FACTS

here had been negotiations between the Pacific Banking Corporation and the Pacific Banking
Corporation Employees Organization (PABECO) for a collective bargaining agreement.

Because of a deadlock, the Minister of Labor assumed jurisdiction over the controversy.

Deputy Minister rendered a decision directing the parties to execute a CBA in accordance with
the terms and conditions set forth in his decision

The union was represented in the negotiations by its president, allegedly assisted as consultant
by Jose P. Umali, Jr., the president of the National Union of Bank Employees (NUBE) with which
it was formerly affiliated

Lawyer Juanito M. Saavedra’s earliest recorded participation in the case was on July 15 and 27,
1979 when he filed a motion for reconsideration and a supplemental motion. No action was
taken on said motions

The parties appealed to the Office of the President of the Philippines. The CBA negotiations
were resumed. The union president took part in the second phase of the negotiations. Saavedra
filed a memorandum.

The Office of the President issued on March 18, 1980 a resolution directing the parties to
execute a CBA containing the terms and conditions of employment embodied in the resolution.

The CBA was ultimately finalized on June 3, 1980. Monetary benefits of more than fourteen
million pesos were involved in the three-year CBA, according to the bank’s counsel.

Even before the formalization of the CBA on June 3, 1980, Saavedra on March 24, 1980 filed in
the case his notice of attorney’s lien. On May 20, 1980, the bank’s vicepresident in a reply to
the letter of the union president stated that he had serious doubts about paying the attorney’s
fees

The union officials requested the bank to withhold around P345,000 out of the total benefits as
ten percent attorney’s fees of Saavedra. In theory, the actual ten percent attorney‘s fees may
amount to more than one million pesos

For nearly a year, the Office of the President in four resolutions wrestled with the propriety of
Saavedra’s ten percent attorney’s fees. In a resolution dated May 29, 1980, Presidential
Executive Assistant Jacobo C. Clave refused to intervene in the matter. He ruled that the
payment of attorney’s fees was a question that should be settled by the union and its lawyer
themselves

Finally, in a fourth resolution dated April 13, 1981 Deputy Presidential Executive Assistant
Joaquin T. Venus, Jr. ordered the bank to pay the union treasurer the said attorney’s fees less
the amounts corresponding to the protesting employees. He held that the following article 222
of the Labor Code, as amended by Presidential Decree No. 1691, effective May 1, 1980 (before
the formalization of the CBA award) had no retroactive effect to the case

ISSUES

RULING

We hold that, under the circumstances, the Office of the President had no jurisdiction to make
an adjudication on Saavedra’s attorney’s fees. The case was appealed with respect to the CBA
terms and conditions, not with respect to attorney’s fees. Although the fees were a mere
incident, nevertheless, the jurisdiction to fix the same and to order the payment thereof was
outside the pale of Clave’s appellate jurisdiction

Moreover, the case is covered squarely by the mandatory and explicit prescription of article 222
which is another guarantee intended to protect the employee against unwarranted practices
that would diminish his compensation without his knowledge and consent.

“ART. 242. Rights and conditions of membership in a labor organization.—The following

are the rights and conditions of membership in a labor organization: “x x x  x x x  x x x
“(n) No special assessment or other extraordinary fees may be levied upon the members
of a labor organization unless authorized by a written resolution of a majority of all the
members at a general membership meeting duly called for the purpose.

(o) Other than for mandatory activities under the Code, no special assessment,
attorney’s fees, xxx

There is no doubt that lawyer Saavedra is entitled to the payment of his fees but article 222
ordains that union funds should be used for that purpose. The amount of P345,000 does not
constitute union funds. It is money of the employees. The union, not the employees, is
obligated to Saavedra

See: Kaisahan at Kapatiran ng mga Manggagawa at Kawani sa MWC- East Zone

Union & Eduardo Borela v Manila Water Co. Inc., GR 174179, Nov 16, 2011

FACTS

ISSUES

(2) whether the NLRC gravely abused its discretion in awarding ten percent (10%) attorney’s
fees to the petitioners.

RULING

As discussed below, our review of the records and of the CA decision shows that the CA erred in
ruling that the NLRC gravely abused its discretion in awarding the petitioners ten percent (10%)
attorney’s fees without basis in fact and in law.

On the Award of Attorney’s Fees

Article 111 of the Labor Code, as amended, governs the grant of attorney’s fees in labor cases:

“Art. 111. Attorney’s fees.—(a) In cases of unlawful withholding of wages, the culpable party
may be assessed attorney’s fees equivalent to ten percent of the amount of wages recovered.

(b) It shall be unlawful for any person to demand or accept, in any judicial or administrative
proceedings for the recovery of wages, attorney’s fees which exceed ten percent of the amount
of wages recovered.”

ordinary concept, an attorney’s fee is the reasonable compensation paid to a lawyer by his
client for the legal services the former renders; compensation is paid for the cost and/or results
of legal services per agreement or as may be assessed.

extraordinary concept, attorney’s fees are deemed indemnity for damages ordered by the
court to be paid by the losing party to the winning party.

The instances when these may be awarded are enumerated in Article 2208 of the Civil Code, specifically
in its paragraph 7 on actions for recovery of wages, and is payable not to the lawyer but to the client,
unless the client and his lawyer have agreed that the award shall accrue to the lawyer as additional or
part of compensation.
Article 111 of the Labor Code is an exception to the declared policy of strict construction in the award of
attorney’s fees. Although an express finding of facts and law is still necessary to prove the merit of the
award, there need not be any showing that the employer acted maliciously or in bad faith when it
withheld the wages.

In the present case, we find it undisputed that the union members are entitled to their AA benefits and
that these benefits were not paid by the Company. That the Company had no funds is not a defense as
this was not an insuperable cause that was cited and properly invoked. As a consequence, the union
members represented by the Union were compelled to litigate and incur legal expenses.

the NLRC’s award of ten percent (10%) attorney’s fees are then upheld.

In the present case, the ten percent (10%) attorney’s fees awarded by the NLRC on the basis of Article
111 of the Labor Code accrue to the Union’s members as indemnity for damages and not to the Union’s
counsel as compensation for his legal services, unless, they agreed that the award shall be given to their
counsel as additional or part of his compensation; in this case the Union bound itself to pay 10%
attorney’s fees to its counsel under the MOA and also gave up the attorney’s fees awarded to the
Union’s members in favor of their counsel. This is supported by Borela’s affidavit. The limit to this
agreement is that the indemnity for damages imposed by the NLRC on the losing party (i.e., the
Company) cannot exceed ten percent (10%).

the attorney’s fees contracted under the MOA do not refer to the amount of attorney’s fees awarded by
the NLRC; the MOA provision on attorney’s fees does not have any bearing at all to the attorney’s fees
awarded by the NLRC under Article 111 of the Labor Code.