PAFLU V.

SEC OF LABOR
Petitioners pray for writs of certiorari and prohibition to restrain respondents, the Secretary of
Labor, the Director of Labor Relations and the Registrar of Labor Organizations, from enforcing an
order of cancellation of the registration certificate of the Social Security System Employees
Association — hereinafter referred to as the SSSEA — which is affiliated to the Philippine
Association of Free Labor Unions — hereinafter referred to as PAFLU — as well as to annul all
proceedings in connection with said cancellation and to prohibit respondents from enforcing
Section 23 of Republic Act No. 875. Petitioners, likewise, pray for a writ of preliminary injunction
pending the final determination of this case. In their answer, respondents traversed some
allegations of fact and the legal conclusions made in the petition. No writ of preliminary
injunction pendente lite has been issued.

It appears that on September 25, 1963, the Registration of Labor Organizations — hereinafter
referred to as the Registrar — issued a notice of hearing, on October 17, 1963, of the matter of
cancellation of the registration of the SSSEA, because of:

1. Failure to furnish the Bureau of Labor Relations with copies of the reports on the finances
of that union duly verified by affidavits which its treasurer or treasurers rendered to said union
and its members covering the periods from September 24, 1960 to September 23, 1961 and
September 24, 1961 to September 23, 1962, inclusive, within sixty days of the 2 respective latter
dates, which are the end of its fiscal year; and

2. Failure to submit to this office the names, postal addresses and non-subversive affidavits
of the officers of that union within sixty days of their election in October (1st
Sunday), 1961 and 1963, in conformity with Article IV (1) of its constitution and by-laws.

in violation of Section 23 of Republic Act No. 875. Counsel for the SSSEA moved to postpone the
hearing to October 21, 1963, and to submit then a memorandum, as well as the documents
specified in the notice. The motion was granted, but, nobody appeared for the SSSEA on the date
last mentioned. The next day, October 22, 1963, Manuel Villagracia, Assistant Secretary of the
SSSEA filed with the Office of the Registrar, a letter dated October 21, 1963, enclosing the
following:

1. Joint non-subversive affidavit of the officers of the SSS Employees' Association-PAFLU;

2. List of newly-elected officers of the Association in its general elections held on April 29,
1963; and

3. Copy of the amended constitution and by-laws of the Association.

Holding

1. That the joint non-subversive affidavit and the list of officers mentioned in the letter of Mr.
Manuel Villagracia were not the documents referred to in the notice of hearing and made the
subject matter of the present proceeding; and

2. That there is no iota of evidence on records to show and/or warrant the dismissal of the
present proceeding.
on October 23, 1963, the Registrar rendered a decision cancelling the SSSEA's Registration
Certificate No. 1-IP169, issued on September 30, 1960. Soon later, or on October 28, 1963,
Alfredo Fajardo, president of the SSSEA moved for a reconsideration of said decision and prayed
for time, up to November 15, within which to submit the requisite papers and data. An opposition
thereto having been filed by one Paulino Escueta, a member of the SSSEA, upon the ground that
the latter had never submitted any financial statement to its members, said motion was heard on
November 27, 1963. Subsequently, or on December 4, 1963, the Registrar issued an order
declaring that the SSSEA had "failed to submit the following requirements to wit:

1. Non-subversive affidavits of Messrs. Teodoro Sison, Alfonso Atienza, Rodolfo

Zalameda, Raymundo Sabino and Napoleon Pefianco who were elected along with others
on January 30, 1962.

2. Names, postal addresses and non-subversive affidavits of all the officers who were
supposedly elected on October (1st Sunday), of its constitution and by-laws.

and granting the SSSEA 15 days from notice to comply with said requirements, as well as
meanwhile holding in abeyance the resolution of its motion for reconsideration.

Pending such resolution, or on December 16, the PAFLU, the SSSEA, Alfredo Fajardo "and all the
officers and members" of the SSSEA commenced the present action, for the purpose stated at the
beginning of this decision, upon the ground that Section 23 of Republic Act No. 875 violates their
freedom of assembly and association, and is inconsistent with the Universal Declaration of Human
Rights; that it unduly delegates judicial power to an administrative agency; that said Section 23
should be deemed repealed by ILO-Convention No. 87; that respondents have acted without or in
excess of jurisdiction and with grave abuse of discretion in promulgating, on November 19, 1963,
its decision dated October 22, 1963, beyond the 30-day period provided in Section 23(c) of
Republic Act No. 875; that "there is no appeal or any other plain, speedy and adequate remedy in
the ordinary course of law"; that the decision complained of had not been approved by the
Secretary of Labor; and that the cancellation of the SSSEA's certificate of registration would cause
irreparable injury.

The theory to the effect that Section 23 of Republic Act No. 875 unduly curtails the freedom of
assembly and association guaranteed in the Bill of Rights is devoid of factual basis. The
registration prescribed in paragraph (b) of said section 1 is not a limitation to the right of assembly
or association, which may be exercised with or without said registration. 2 The latter is merely a
condition sine qua non for the acquisition of legal personality by labor organizations, associations
or unions and the possession of the "rights and privileges granted by law to legitimate labor
organizations". The Constitution does not guarantee these rights and privileges, much less said
personality, which are mere statutory creations, for the possession and exercise of which
registration is required to protect both labor and the public against abuses, fraud, or impostors
who pose as organizers, although not truly accredited agents of the union they purport to
represent. Such requirement is a valid exercise of the police power, because the activities in which
labor organizations, associations and union of workers are engaged affect public interest, which
should be protected. 3 Furthermore, the obligation to submit financial statements, as a condition for
the non-cancellation of a certificate of registration, is a reasonable regulation for the benefit of the
members of the organization, considering that the same generally solicits funds or membership,
as well as oftentimes collects, on behalf of its members, huge amounts of money due to them or to
the organization. 4

For the same reasons, said Section 23 does not impinge upon the right of organization guaranteed
in the Declaration of Human Rights, or run counter to Articles 2, 4, 7 and Section 2 of
Article 8 of the ILO-Convention No. 87, which provide that "workers and employers, ... shall have
the right to establish and ... join organizations of their own choosing, without previous
authorization"; that "workers and employers organizations shall not be liable to be dissolved or
suspended by administrative authority"; that "the acquisition of legal personality by workers' and
employers' organizations, ... shall not be made subject to conditions of such a character as to
restrict the application of the provisions" above mentioned; and that "the guarantees provided for
in" said Convention shall not be impaired by the law of the land.

In B.S.P. v. Araos, 5 we held that there is no incompatibility between Republic Act No. 875 and the
Universal Declaration of Human Rights. Upon the other hand, the cancellation of the SSSEA's
registration certificate would not entail a dissolution of said association or its suspension. The
existence of the SSSEA would not be affected by said cancellation, although its juridical
personality and its statutory rights and privileges — as distinguished from those conferred by the
Constitution — would be suspended thereby.

To be registered, pursuant to Section 23(b) of Republic Act No. 875, a labor organization,
association or union of workers must file with the Department of Labor the following documents:

(1) A copy of the constitution and by-laws of the organization together with a list of all officers
of the association, their addresses and the address of the principal office of the organization;

(2) A sworn statement of all the officers of the said organization, association or union to the
effect that they are not members of the Communist Party and that they are not members of any
organization which teaches the overthrow of the Government by force or by any illegal or
unconstitutional method; and

(3) If the applicant organization has been in existence for one or more years, a copy of its last
annual financial report.

Moreover, paragraph (d) of said-Section ordains that:

The registration and permit of a legitimate labor organization shall be cancelled by the
Department of Labor, if the Department has reason to believe that the labor
organization no longer meets one or more of the requirements of paragraph (b) above; or
fails to file with the Department Labor either its financial report within the sixty days of the
end of its fiscal year or the names of its new officers along with their non-subversive
affidavits as outlined in paragraph (b) above within sixty days of their election; however, the
Department of Labor shall not order the cancellation of the registration and permit without
due notice and hearing, as provided under paragraph (c) above and the affected labor
organization shall have the same right of appeal to the courts as previously provided. 6

The determination of the question whether the requirements of paragraph (b) have been met, or
whether or not the requisite financial report or non-subversive affidavits have been filed within the
period above stated, is not judicial power. Indeed, all officers of the government, including those in
the executive department, are supposed, to act on the basis of facts, as they see the same. This is
specially true as regards administrative agencies given by law the power to investigate and render
decisions concerning details related to the execution of laws the enforcement of which is entrusted
thereto. Hence, speaking for this Court, Mr. Justice Reyes (J.B.L.) had occassion to say:
 The objections of the appellees to the constitutionality of Republic Act No. 2056, not only
as an undue delegation of judicial power to the Secretary of Public Works but also for
being unreasonable and arbitrary, are not tenable. It will be noted that the Act (R.A. 2056)
merely empowers the Secretary to remove unauthorized obstructions or encroachments
upon public streams, constructions that no private person was anyway entitled to make
because the bed of navigable streams is public property, and ownership thereof is not
acquirable by adverse possession
(Palanca vs. Commonwealth, 69 Phil., 449).

It is true that the exercise of the Secretary's power under the Act necessarily involves the
determination of some question of fact, such as the existence of the stream and its
previous navigable character; but these functions, whether judicial or quasi-judicial, are
merely incidental to the exercise of the power granted by law to clear navigable streams of
unauthorized obstructions or encroachments, and authorities are clear that they are
validly conferable upon executive officials provided the party affected is given opportunity
to be heard, as is expressly required by Republic Act No. 2056, section 2. 7

It should be noted also, that, admittedly, the SSSEA had not filed the non-subversive affidavits of
some of its officers — "Messrs. Sison, Tolentino, Atienza, Zalameda, Sabino and Pefianca" —
although said organization avers that these persons "were either resigned or out on leave as
directors or officers of the union", without specifying who had resigned and who were on leave.
This averment is, moreover, controverted by respondents herein.

Again, the 30-day period invoked by the petitioners is inapplicable to the decision complained of.
Said period is prescribed in paragraph (c) 8 of Section 23, which refers to the proceedings for the
"registration" of labor organizations, associations or unions not to the "cancellation" of said
registration, which is governed by the abovequoted paragraph (d) of the same section.

Independently of the foregoing, we have repeatedly held that legal provisions prescribing the
period within which a decision should be rendered are directory, not mandatory in nature — in the
sense that, a judgment promulgated after the expiration of said period is not null and void,
although the officer who failed to comply with law may be dealt with administratively, in
consequence of his delay 9 — unless the intention to the contrary is manifest. Such, however, is not
the import of said paragraph (c). In the language of Black:

When a statute specifies the time at or within which an act is to be done by a public officer
or body, it is generally held to be directory only as to the time, and not mandatory, unless
time is of the essence of the thing to be done, or the language of the statute contains
negative words, or shows that the designation of the time was intended as a limitation of
power, authority or right. 10

Then, again, there is no law requiring the approval, by the Secretary of Labor, of the decision of
the Registrar decreeing the cancellation of a registration certificate. In fact, the language of
paragraph (d) of Section 23, suggests that, once the conditions therein specified are present, the
office concerned "shall" have no choice but to issue the order of cancellation. Moreover, in the
case at bar, there is nothing, as yet, for the Secretary of Labor to approve or disapprove, since
petitioners, motion for reconsideration of the Registrar's decision of October 23, 1963, is still
pending resolution. In fact, this circumstance shows, not only that the present action is premature,
11
but, also, that petitioners have failed to exhaust the administrative remedies available to them. 12
Indeed, they could ask the Secretary of Labor to disapprove the Registrar's
decision or object to its execution or enforcement, in the absence of approval of the former, if the
same were necessary, on which we need not and do not express any opinion.

IN VIEW OF THE FOREGOING, the petition herein should be, as it is hereby dismissed, and the
writs prayed for denied, with costs against the petitioners. It is so ordered.
lawphi1.nêt

CASE
DIGEST
FACTS: The Registration of Labor Organization (Registrar) rendered a
decision cancelling the SSSEA’s Registration Certificate No. 1-IP169 for failure to
submit the following:
1. Failure to furnish the Bureau of Labor Relations with copies of the reports on
the finances of that union duly verified by affidavits which its treasurer or
treasurers rendered to said union and its members covering the periods from
September 24, 1960 to September 23, 1961 and September 24, 1961 to
September 23, 1962, inclusive, within sixty days of the 2 respective latter dates,
which are the end of its fiscal year; and

2. Failure to submit to this office the names, postal addresses and

nonsubversive affidavits of the officers of that union within sixty days of their
election in October (1st Sunday), 1961 and 1963, in conformity with Article IV (1)
of its constitution and by-laws.

On the following day, Manuel Villagracia, Assistant Secretary of the SSSEA filed
with the Office of the Registrar, a letter enclosing documents that supposed to
comply with the abovementioned requirements, but the Registrar found out that
the following are still not complied with:

1. Non-subversive affidavits of Messrs. Teodoro Sison, Alfonso Atienza, Rodolfo

Zalameda, Raymundo Sabino and Napoleon Pefianco who were elected along with
others on January 30, 1962.
2. Names, postal addresses and non-subversive affidavits of all the officers who
were supposedly elected on October (1st Sunday), of its constitution and by-laws.

Alfredo Fajardo, president of the SSSEA moved for a reconsideration of said

decision and prayed for time, up to November 15, within which to submit the
requisite papers and data. An opposition thereto having been filed by one Paulino
Escueta, a member of the SSSEA, upon the ground that the latter had never
submitted any financial statement to its members, said motion was heard on
November 27, 1963.
Subsequently, or on December 4, 1963, the Registrar issued an order declaring that
the SSSEA had “failed to submit the abovementioned requirements and granting
the SSSEA 15 days from notice to comply with said requirements, as well as
meanwhile holding in abeyance the resolution of its motion for reconsideration.

ISSUE: Whether or not the effect of Section 23 of Republic Act No. 875 (“Any labor
organization, association or union of workers duly organized for the material,
intellectual and moral well being of its members shall acquire legal personality and
be entitled to all the rights and privileges granted by law to legitimate labor
organizations within thirty days of filing with the office of the Secretary of Labor
notice of its due organization and existence and the following documents, together
with the amount of five pesos as registration fee, except as provided in paragraph
“d” of this section:”) unduly curtails the freedom of assembly and association
guaranteed in the Bill of Rights.
RULING: There is no incompatibility between Republic Act No. 875 and the
Universal Declaration of Human Rights. Upon the other hand, the cancellation of
the SSSEA’s registration certificate would not entail a dissolution of said association
or its suspension. The existence of the SSSEA would not be affected by said
cancellation, although its juridical personality and its statutory rights and privileges
— as distinguished from those conferred by the Constitution — would be
suspended thereby.
To be registered, pursuant to Section 23(b) of Republic Act No. 875, a labor
organization, association or union of workers must file with the Department of
Labor the following documents:

(1) A copy of the constitution and by-laws of the organization together with a list
of all officers of the association, their addresses and the address of the principal
office of the organization;

(2) A sworn statement of all the officers of the said organization, association or
union to the effect that they are not members of the Communist Party and that
they are not members of any organization which teaches the overthrow of the
Government by force or by any illegal or unconstitutional method; and

(3) If the applicant organization has been in existence for one or more years, a
copy of its last annual financial report.

Moreover, paragraph (d) of said-Section ordains that:

The registration and permit of a legitimate labor organization shall be cancelled by

the Department of Labor, if the Department has reason to believe that the labor
organization no longer meets one or more of the requirements of paragraph (b)
above; or fails to file with the Department Labor either its financial report within
the sixty days of the end of its fiscal year or the names of its new officers along with
their nonsubversive affidavits as outlined in paragraph (b) above within sixty days
of their election; however, the Department of Labor shall not order the cancellation
of the registration and permit without due notice and hearing, as provided under
paragraph (c) above and the affected labor organization shall have the same right
of appeal to the courts as previously provided.

Topic: Union registration;

Definition

FACTS:
Petitioners pray for writs of certiorari and prohibition to restrain respondents from enforcing an order of
cancellation of the registration certificate of the Social Security System Employees Association —
 hereinafter referred to as the SSSEA — which is affiliated to the Philippine Association of Free Labor
Unions — hereinafter referred to as PAFLU — as well as to annul all proceedings in connection with
said cancellation and to prohibit respondents from enforcing Section 23 of Republic Act No. 875.

In registration of Labor Organization, there was hearing conducted because of the following:
Failure to furnish the Bureau of Labor Relations with copies of the reports on the finances of that
union duly verified by affidavits which its treasurer or treasurers rendered to said union and its
members covering the periods from September 24, 1960 to September 23, 1961 and September 24,
1961 to September 23, 1962, inclusive, within sixty days of the 2 respective latter dates, which are the
end of its fiscal year; and
Failure to submit to this office the names, postal addresses and non-subversive affidavits of the
officers of that union within sixty days of their election in October (1st Sunday), 1961 and 1963, in
conformity with Article IV (1) of its constitution and by-laws.

the Registrar rendered a decision cancelling the SSSEA's Registration Certificate No. 1-IP169,
issued on September 30, 1960. Soon later, or on October 28, 1963, Alfredo Fajardo, president of the
SSSEA moved for a reconsideration of said decision and prayed for time, up to November 15, within
which to submit the requisite papers and data. An opposition thereto having been filed by one Paulino
Escueta, a member of the SSSEA, upon the ground that the latter had never submitted any financial
statement to its members, said motion was heard on November 27, 1963. Subsequently, or on
December 4, 1963, the Registrar issued an order declaring that the SSSEA had failed to submit the
requirements needed.

Pending such resolution, or on December 16, the PAFLU, the SSSEA, Alfredo Fajardo "and all the
officers and members" of the SSSEA commenced the present action, for the purpose stated at the
beginning of this decision, upon the ground that Section 23 of Republic Act No. 875 violates their
freedom of assembly and association, and is inconsistent with the Universal Declaration of Human
Rights; that it unduly delegates judicial power to an administrative agency; that said Section 23 should
be deemed repealed by ILO-Convention No. 87; that respondents have acted without or in excess of
jurisdiction and with grave abuse of discretion in promulgating, on November 19, 1963, its decision
dated October 22, 1963, beyond the 30-day period provided in Section 23(c) of Republic Act No. 875;
that "there is no appeal or any other plain, speedy and adequate remedy in the ordinary course of
law"; that the decision complained of had not been approved by the Secretary of Labor; and that the
cancellation of the SSSEA's certificate of registration would cause irreparable injury.

ISSUE/S:
WON Section 23 of Republic Act No. 875 unduly limits the freedom of assembly and
association?

RULING: NO. The registration prescribed in paragraph (b) of said section is not a limitation to the right
of assembly or association, which may be exercised with or without said registration. The latter is
merely a condition sine qua non for the acquisition of legal personality by labor organizations,
associations or unions and the possession of the "rights and privileges granted by law to legitimate
labor organizations". The Constitution does not guarantee these rights and privileges, much less said
personality, which are mere statutory creations, for the possession and exercise of which registration is
required to protect both labor and the public against abuses, fraud, or impostors who pose as
organizers, although not truly accredited agents of the union they purport to represent. Such
requirement is a valid exercise of the police power, because the activities in which labor organizations,
associations and union of workers are engaged affect public interest, which should be protected.
Furthermore, the obligation to submit financial statements, as a condition for the non-cancellation of a
certificate of registration, is a reasonable regulation for the benefit of the members of the organization,
considering that the same generally solicits funds or membership, as well as oftentimes collects, on
behalf of its members, huge amounts of money due to them or to the organization.
1. For the same reasons, said Section 23 does not impinge upon the right of organization
guaranteed in the Declaration of Human Rights, or run counter to Articles 2, 4, 7 and Section 2 of
Article 8 of the ILOConvention No. 87, which provide that "workers and employers, ... shall have
the right to establish and ... join organizations of their own choosing, without previous
authorization"; that "workers and employers organizations shall not be liable to be dissolved or
suspended by administrative authority"; that "the acquisition of legal personality by workers' and
employers' organizations, ... shall not be made subject to conditions of such a character as to
restrict the application of the provisions" above mentioned; and that "the guarantees provided for
in" said Convention shall not be impaired by the law of the land.

2. Moreover, paragraph (d) of said-Section ordains that:

The registration and permit of a legitimate labor organization shall be cancelled by the Department of
Labor, if the Department has reason to believe that the labor organization no longer meets one or more
of the requirements of paragraph (b) above; or fails to file with the Department Labor either its financial
report within the sixty days of the end of its fiscal year or the names of its new officers along with their
non-subversive affidavits as outlined in paragraph (b) above within sixty days of their election; however,
the Department of Labor shall not order the cancellation of the registration and permit without due
notice and hearing, as provided under paragraph (c) above and the affected labor organization shall
have the same right of appeal to the courts as previously provided.

3. The determination of the question whether the requirements of paragraph (b) have been met, or
whether or not the requisite financial report or non-subversive affidavits have been filed within the
period above stated, is not judicial power. Indeed, all officers of the government, including those
in the executive department, are supposed, to act on the basis of facts, as they see the same.
This is specially true as regards administrative agencies given by law the power to investigate
and render decisions concerning details related to the execution of laws the enforcement of
which is entrusted thereto.

DISPOSITIVE: The secretary of labor, the director of labor relations and the registrar of labor
organizations won.

DOCTRINE: There is no incompatibility between Republic Act No. 875 and the Universal Declaration of
Human Rights. Upon the other hand, the cancellation of the SSSEA's registration certificate would not
entail a dissolution of said association or its suspension. The existence of the SSSEA would not be
affected by said cancellation, although its juridical personality and its statutory rights and privileges —
as distinguished from those conferred by the Constitution — would be suspended thereby.To be
registered, pursuant to Section 23(b) of Republic Act No. 875, a labor organization, association or
union of workers must file with the Department of Labor the following documents:
(1) A copy of the constitution and by-laws of the organization together with a list of all officers of the
association, their addresses and the address of the principal office of the organization;
(2) A sworn statement of all the officers of the said organization, association or union to the effect
that they are not members of the Communist Party and that they are not members of any organization
which teaches the overthrow of the Government by force or by any illegal or unconstitutional method;
and

(3) If the applicant organization has been in existence for one or more years, a copy of its last
annual financial report.
SAN MIGUEL CORPORATION EMPLOYEES UNION–PHILIPPINE TRANSPORT AND GENERAL
WORKERS ORGANIZATION (SMCEU–PTGWO), petitioner, vs.
SAN MIGUEL PACKAGING PRODUCTS EMPLOYEES UNION–PAMBANSANG DIWA NG
MANGGAGAWANG PILIPINO (SMPPEU–PDMP), respondent1.

In this Petition for Review on Certiorari under Rule 45 of the Revised Rules of Court, petitioner
SAN MIGUEL CORPORATION EMPLOYEES UNION-PHILIPPINE TRANSPORT AND
GENERAL WORKERS ORGANIZATION (SMCEU-PTGWO) prays that this Court reverse and set
aside the (a) Decision2 dated 9 March 2005 of the Court of Appeals in CA-G.R. SP No. 66200,
affirming the Decision3 dated 19 February 2001 of the Bureau of Labor Relations (BLR) of the
Department of Labor and Employment (DOLE) which upheld the Certificate of Registration of
respondent SAN MIGUEL PACKAGING PRODUCTS EMPLOYEES UNION–PAMBANSANG
DIWA NG MANGGAGAWANG PILIPINO (SMPPEU–PDMP); and (b) the Resolution 4 dated 16
January 2006 of the Court of Appeals in the same case, denying petitioner's Motion for
Reconsideration of the aforementioned Decision.

The following are the antecedent facts:

Petitioner is the incumbent bargaining agent for the bargaining unit comprised of the regular
monthly-paid rank and file employees of the three divisions of San Miguel Corporation (SMC),
namely, the San Miguel Corporate Staff Unit (SMCSU), San Miguel Brewing Philippines (SMBP),
and the San Miguel Packaging Products (SMPP), in all offices and plants of SMC, including the
Metal Closure and Lithography Plant in Laguna. It had been the certified bargaining agent for 20
years – from 1987 to 1997.

Respondent is registered as a chapter of Pambansang Diwa ng Manggagawang Pilipino (PDMP).

PDMP issued Charter Certificate No. 112 to respondent on 15 June 1999. 5 In compliance with
registration requirements, respondent submitted the requisite documents to the BLR for the
purpose of acquiring legal personality.6 Upon submission of its charter certificate and other
documents, respondent was issued Certificate of Creation of Local or Chapter PDMP-01 by the
BLR on 6 July 1999.7 Thereafter, respondent filed with the Med-Arbiter of the DOLE Regional
Officer in the National Capital Region (DOLE-NCR), three separate petitions for certification
election to represent SMPP, SMCSU, and SMBP.8 All three petitions were dismissed, on the
ground that the separate petitions fragmented a single bargaining unit. 9

On 17 August 1999, petitioner filed with the DOLE-NCR a petition seeking the cancellation of
respondent's registration and its dropping from the rolls of legitimate labor organizations. In its
petition, petitioner accused respondent of committing fraud and falsification, and non-compliance
with registration requirements in obtaining its certificate of registration. It raised allegations that
respondent violated Articles 239(a), (b) and (c)10 and 234(c)11 of the Labor Code. Moreover,
petitioner claimed that PDMP is not a legitimate labor organization, but a trade union center,
hence, it cannot directly create a local or chapter. The petition was docketed as Case No.
NCROD-9908-007-IRD.12

On 14 July 2000, DOLE-NCR Regional Director Maximo B. Lim issued an Order dismissing the
allegations of fraud and misrepresentation, and irregularity in the submission of documents by
respondent. Regional Director Lim further ruled that respondent is allowed to directly create a
local or chapter. However, he found that respondent did not comply with the 20% membership
requirement and, thus, ordered the cancellation of its certificate of registration and removal from
the rolls of legitimate labor organizations.13 Respondent appealed to the BLR. In a Decision dated
19 February 2001, it declared:
As a chartered local union, appellant is not required to submit the number of employees
and names of all its members comprising at least 20% of the employees in the bargaining
unit where it seeks to operate. Thus, the revocation of its registration based on
noncompliance with the 20% membership requirement does not have any basis in the
rules.
 Further, although PDMP is considered as a trade union center, it is a holder of
Registration Certificate No. FED-11558-LC issued by the BLR on 14 February 1991, which
bestowed upon it the status of a legitimate labor organization with all the rights and
privileges to act as representative of its members for purposes of collective bargaining
agreement. On this basis, PDMP can charter or create a local, in accordance with the
provisions of Department Order No. 9.

WHEREFORE, the appeal is hereby GRANTED. Accordingly, the decision of the Regional
Director dated July 14, 2000, canceling the registration of appellant San Miguel Packaging
Products Employees Union-Pambansang Diwa ng Manggagawang Pilipino
(SMPPEUPDMP) is REVERSED and SET ASIDE. Appellant shall hereby remain in the
roster of legitimate labor organizations. 14

While the BLR agreed with the findings of the DOLE Regional Director dismissing the allegations
of fraud and misrepresentation, and in upholding that PDMP can directly create a local or a
chapter, it reversed the Regional Director's ruling that the 20% membership is a requirement for
respondent to attain legal personality as a labor organization. Petitioner thereafter filed a Motion
for Reconsideration with the BLR. In a Resolution rendered on 19 June 2001 in BLR-A-C-64-05-
900 (NCR-OD-9908-007-IRD), the BLR denied the Motion for Reconsideration and affirmed its
Decision dated 19 February 2001.15

Invoking the power of the appellate court to review decisions of quasi-judicial agencies, petitioner
filed with the Court of Appeals a Petition for Certiorari under Rule 65 of the 1997 Rules of Civil
Procedure docketed as CA-G.R. SP No. 66200. The Court of Appeals, in a Decision dated 9
March 2005, dismissed the petition and affirmed the Decision of the BLR, ruling as follows:

In Department Order No. 9, a registered federation or national union may directly create a
local by submitting to the BLR copies of the charter certificate, the local's constitution and
by-laws, the principal office address of the local, and the names of its officers and their
addresses. Upon complying with the documentary requirements, the local shall be issued
a certificate and included in the roster of legitimate labor organizations. The [herein
respondent] is an affiliate of a registered federation PDMP, having been issued a charter
certificate. Under the rules we have reviewed, there is no need for SMPPEU to show a
membership of 20% of the employees of the bargaining unit in order to be recognized as a
legitimate labor union.

xxxx

In view of the foregoing, the assailed decision and resolution of the BLR are AFFIRMED,
and the petition is DISMISSED.16

Subsequently, in a Resolution dated 16 January 2006, the Court of Appeals denied petitioner's
Motion for Reconsideration of the aforementioned Decision.

Hence, this Petition for Certiorari under Rule 45 of the Revised Rules of Court where petitioner
raises the sole issue of:

WHETHER OR NOT THE HONORABLE COURT OF APPEALS COMMITTED

REVERSIBLE ERROR IN RULING THAT PRIVATE RESPONDENT IS NOT REQUIRED
TO SUBMIT THE NUMBER OF EMPLOYEES AND NAMES OF ALL ITS MEMBERS
 COMPRISING AT LEAST 20% OF THE EMPLOYEES IN THE BARGAINING UNIT
WHERE IT SEEKS TO OPERATE.

The present petition questions the legal personality of respondent as a legitimate labor
organization.

Petitioner posits that respondent is required to submit a list of members comprising at least 20% of
the employees in the bargaining unit before it may acquire legitimacy, citing Article 234(c) of the
Labor Code which stipulates that any applicant labor organization, association or group of unions
or workers shall acquire legal personality and shall be entitled to the rights and privileges granted
by law to legitimate labor organizations upon issuance of the certificate of registration based on
the following requirements:

a. Fifty pesos (P50.00) registration fee;

b. The names of its officers, their addresses, the principal address of the labor organization,
the minutes of the organizational meetings and the list of the workers who participated in such
meetings;

c. 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;

d. If the applicant union has been in existence for one or more years, copies of its annual
financial reports; and

e. Four (4) copies of the constitution and by-laws of the applicant union, minutes of its
adoption or ratification and the list of the members who participated in it. 17

Petitioner also insists that the 20% requirement for registration of respondent must be based not
on the number of employees of a single division, but in all three divisions of the company in all the
offices and plants of SMC since they are all part of one bargaining unit. Petitioner refers to Section
1, Article 1 of the Collective Bargaining Agreement (CBA), 18 quoted hereunder:

ARTICLE 1

SCOPE

Section 1. Appropriate Bargaining Unit. The appropriate bargaining unit covered by this
Agreement consists of all regular rank and file employees paid on the basis of fixed salary
per month and employed by the COMPANY in its Corporate Staff Units (CSU), San Miguel
Brewing Products (SMBP) and San Miguel Packaging Products (SMPP) and in different
operations existing in the City of Manila and suburbs, including Metal Closure and
Lithography Plant located at Canlubang, Laguna subject to the provisions of Article XV of
this Agreement provided however, that if during the term of this Agreement, a plant within
the territory covered by this Agreement is transferred outside but within a radius of fifty
(50) kilometers from the Rizal Monument, Rizal Park, Metro Manila, the employees in the
transferred plant shall remain in the bargaining unit covered by this Agreement. (Emphasis
supplied.)
Petitioner thus maintains that respondent, in any case, failed to meet this 20% membership
requirement since it based its membership on the number of employees of a single division only,
namely, the SMPP.

There is merit in petitioner's contentions.

A legitimate labor organization19 is defined as "any labor organization duly registered with the
Department of Labor and Employment, and includes any branch or local thereof."20 The mandate
of the Labor Code is to ensure strict compliance with the requirements on registration because a
legitimate labor organization is entitled to specific rights under the Labor Code, 21 and are involved
in activities directly affecting matters of public interest. Registration requirements are intended to
afford a measure of protection to unsuspecting employees who may be lured into joining
unscrupulous or fly-by-night unions whose sole purpose is to control union funds or use the labor
organization for illegitimate ends.22 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 representative23 of all the employees in an appropriate collective bargaining unit for
purposes of collective bargaining. 24 The acquisition of rights by any union or labor organization,
particularly the right to file a petition for certification election, first and foremost, depends on
whether or not the labor organization has attained the status of a legitimate labor organization. 25

A perusal of the records reveals that respondent is registered with the BLR as a "local" or
"chapter" of PDMP and was issued Charter Certificate No. 112 on 15 June 1999. Hence,
respondent was directly chartered by PDMP.

The procedure for registration of a local or chapter of a labor organization is provided in Book V of
the Implementing Rules of the Labor Code, as amended by Department Order No. 9 which took
effect on 21 June 1997, and again by Department Order No. 40 dated 17 February 2003. The
Implementing Rules as amended by D.O. No. 9 should govern the resolution of the petition at bar
since respondent's petition for certification election was filed with the BLR in 1999; and that of
petitioner on 17 August 1999. 26

The applicable Implementing Rules enunciates a two-fold procedure for the creation of a chapter
or a local. The first involves the affiliation of an independent union with a federation or national
union or industry union. The second, finding application in the instant petition, involves the direct
creation of a local or a chapter through the process of chartering. 27

A duly registered federation or national union may directly create a local or chapter by submitting
to the DOLE Regional Office or to the BLR two copies of the following:

(a) A charter certificate issued by the federation or national union indicating the creation or
establishment of the local/chapter;

(b) The names of the local/chapter's officers, their addresses, and the principal office of the
local/chapter; and

(c) The local/chapter's constitution and by-laws; Provided, That where the local/chapter's
constitution and by-laws is the same as that of the federation or national union, this fact shall be
indicated accordingly.
 All the foregoing supporting requirements shall be certified under oath by the Secretary or
the Treasurer of the local/chapter and attested to by its President. 28

The Implementing Rules stipulate that a local or chapter may be directly created by
a federation or national union. A duly constituted local or chapter created in accordance with the
foregoing shall acquire legal personality from the date of filing of the complete documents with the
BLR.29 The issuance of the certificate of registration by the BLR or the DOLE Regional Office is not
the operative act that vests legal personality upon a local or a chapter under Department Order
No. 9. Such legal personality is acquired from the filing of the complete documentary requirements
enumerated in Section 1, Rule VI.30

Petitioner insists that Section 3 of the Implementing Rules, as amended by Department Order No.
9, violated Article 234 of the Labor Code when it provided for less stringent requirements for the
creation of a chapter or local. This Court disagrees.

Article 234 of the Labor Code provides that an independent labor organization acquires
legitimacy only upon its registration with the BLR:

Any applicant labor organization, association or group of unions or workers shall acquire
legal personality and shall be entitled to the rights and privileges granted by law to
legitimate labor organizations upon issuance of the certificate of registration based on the
following requirements:

(a) Fifty pesos (P50.00) registration fee;

(b) The names of its officers, their addresses, the principal address of the labor organization,
the minutes of the organizational meetings and the list of the workers who participated in such
meetings;

(c) 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;

(d) If the applicant union has been in existence for one or more years, copies of its annual
financial reports; and

(e) Four (4) copies of the constitution and by-laws of the applicant union, minutes of its
adoption or ratification, and the list of the members who participated in it. (Italics supplied.)

It is emphasized that the foregoing pertains to the registration of an independent labor

organization, association or group of unions or workers.

However, the creation of a branch, local or chapter is treated differently. This Court, in the
landmark case of Progressive Development Corporation v. Secretary, Department of Labor and
Employment,31 declared that when an unregistered union becomes a branch, local or chapter,
some of the aforementioned requirements for registration are no longer necessary or compulsory.
Whereas an applicant for registration of an independent union is mandated to submit, among other
things, the number of employees and names of all its members comprising at least 20% of the
employees in the bargaining unit where it seeks to operate, as provided under Article 234 of the
Labor Code and Section 2 of Rule III, Book V of the Implementing Rules, the same is no longer
required of a branch, local or chapter.32 The intent of the law in imposing less requirements in the
case of a branch or local of a registered federation or national union is to encourage the
affiliation of a local union with a federation or national union in order to increase the local union's
bargaining powers respecting terms and conditions of labor. 33

Subsequently, in Pagpalain Haulers, Inc. v. Trajano34 where the validity of Department Order No. 9
was directly put in issue, this Court was unequivocal in finding that there is no inconsistency
between the Labor Code and Department Order No. 9.

As to petitioner's claims that respondent obtained its Certificate of Registration through fraud and
misrepresentation, this Court finds that the imputations are not impressed with merit. In the instant
case, proof to declare that respondent committed fraud and misrepresentation remains wanting.
This Court had, indeed, on several occasions, pronounced that registration based on false and
fraudulent statements and documents confer no legitimacy upon a labor organization irregularly
recognized, which, at best, holds on to a mere scrap of paper. Under such circumstances, the
labor organization, not being a legitimate labor organization, acquires no rights. 35

This Court emphasizes, however, that a direct challenge to the legitimacy of a labor organization
based on fraud and misrepresentation in securing its certificate of registration is a serious
allegation which deserves careful scrutiny. Allegations thereof should be compounded with
supporting circumstances and evidence. The records of the case are devoid of such evidence.
Furthermore, this Court is not a trier of facts, and this doctrine applies with greater force in labor
cases. Findings of fact of administrative agencies and quasi-judicial bodies, such as the BLR,
which have acquired expertise because their jurisdiction is confined to specific matters, are
generally accorded not only great respect but even finality. 36

Still, petitioner postulates that respondent was not validly and legitimately created, for PDMP
cannot create a local or chapter as it is not a legitimate labor organization, it being a trade union
center.

Petitioner's argument creates a predicament as it hinges on the legitimacy of PDMP as a labor

organization. Firstly, this line of reasoning attempts to predicate that a trade union center is not a
legitimate labor organization. In the process, the legitimacy of PDMP is being impugned, albeit
indirectly. Secondly, the same contention premises that a trade union center cannot directly create
a local or chapter through the process of chartering.

Anent the foregoing, as has been held in a long line of cases, the legal personality of a legitimate
labor organization, such as PDMP, cannot be subject to a collateral attack. The law is very clear
on this matter. Article 212 (h) of the Labor Code, as amended, defines a legitimate labor
organization37 as "any labor organization duly registered with the DOLE, and includes any branch
or local thereof."38 On the other hand, a trade union center is any group of registered national
unions or federations organized for the mutual aid and protection of its members; for assisting
such members in collective bargaining; or for participating in the formulation of social and
employment policies, standards, and programs, and is duly registered with the DOLE in
accordance with Rule III, Section 2 of the Implementing Rules. 39

The Implementing Rules stipulate that a labor organization shall be deemed registered and vested
with legal personality on the date of issuance of its certificate of registration. Once a certificate of
registration is issued to a union, its legal personality cannot be subject to collateral attack. 40 It may
be questioned only in an independent petition for cancellation in accordance with Section 5 of
Rule V, Book V of the Implementing Rules. The aforementioned provision is enunciated in the
following:
 Sec. 5. Effect of registration. The labor organization or workers' association shall be
deemed registered and vested with legal personality on the date of issuance of its
certificate of registration. Such legal personality cannot thereafter be subject to collateral
attack, but may be questioned only in an independent petition for cancellation in
accordance with these Rules.

PDMP was registered as a trade union center and issued Registration Certificate No. FED-
11558LC by the BLR on 14 February 1991. Until the certificate of registration of PDMP is
cancelled, its legal personality as a legitimate labor organization subsists. Once a union acquires
legitimate status as a labor organization, it continues to be recognized as such until its certificate of
registration is cancelled or revoked in an independent action for cancellation. 41 It bears to
emphasize that what is being directly challenged is the personality of respondent as a legitimate
labor organization and not that of PDMP. This being a collateral attack, this Court is without
jurisdiction to entertain questions indirectly impugning the legitimacy of PDMP.

Corollarily, PDMP is granted all the rights and privileges appurtenant to a legitimate labor
organization,42 and continues to be recognized as such until its certificate of registration is
successfully impugned and thereafter cancelled or revoked in an independent action for
cancellation.

We now proceed to the contention that PDMP cannot directly create a local or a chapter, it being a
trade union center.

This Court reverses the finding of the appellate court and BLR on this ground, and rules that
PDMP cannot directly create a local or chapter.

After an exhaustive study of the governing labor law provisions, both statutory and regulatory, 43 we
find no legal justification to support the conclusion that a trade union center is allowed to directly
create a local or chapter through chartering. Apropos, we take this occasion to reiterate the first
and fundamental duty of this Court, which is to apply the law. The solemn power and duty of the
Court to interpret and apply the law does not include the power to correct by reading into the law
what is not written therein.44

Presidential Decree No. 442, better known as the Labor Code, was enacted in 1972. Being a
legislation on social justice,45 the provisions of the Labor Code and the Implementing Rules have
been subject to several amendments, and they continue to evolve, considering that labor plays a
major role as a socio-economic force. The Labor Code was first amended by Republic Act No.
6715, and recently, by Republic Act No. 9481. Incidentally, the term trade union center was never
mentioned under Presidential Decree No. 442, even as it was amended by Republic Act No. 6715.
The term trade union center was first adopted in the Implementing Rules, under Department Order
No. 9.

Culling from its definition as provided by Department Order No. 9, a trade union center is any
group of registered national unions or federations organized for the mutual aid and protection of its
members; for assisting such members in collective bargaining; or for participating in the
formulation of social and employment policies, standards, and programs, and is duly registered
with the DOLE in accordance with Rule III, Section 2 of the Implementing Rules. 46 The same rule
provides that the application for registration of an industry or trade union center shall be supported
by the following:
 (a) The list of its member organizations and their respective presidents and, in the case of an
industry union, the industry where the union seeks to operate;

(b) The resolution of membership of each member organization, approved by the Board of
Directors of such union;

(c) The name and principal address of the applicant, the names of its officers and their
addresses, the minutes of its organizational meeting/s, and the list of member organizations and
their representatives who attended such meeting/s; and

(d) A copy of its constitution and by-laws and minutes of its ratification by a majority of the
presidents of the member organizations, provided that where the ratification was done
simultaneously with the organizational meeting, it shall be sufficient that the fact of ratification be
included in the minutes of the organizational meeting. 47

Evidently, while a "national union" or "federation" is a labor organization with at least ten locals or
chapters or affiliates, each of which must be a duly certified or recognized collective bargaining
agent;48 a trade union center, on the other hand, is composed of a group of registered national
unions or federations.49

The Implementing Rules, as amended by Department Order No. 9, provide that "a duly registered
federation or national union" may directly create a local or chapter. The provision reads:

Section 1. Chartering and creation of a local/chapter. – A duly registered federation or

national union may directly create a local/chapter by submitting to the Regional Office or to
the Bureau two (2) copies of the following:

(a) A charter certificate issued by the federation or national union indicating the creation or
establishment of the local/chapter;

(b) The names of the local/chapter's officers, their addresses, and the principal office of the
local/chapter; and

(c) The local/chapter's constitution and by-laws; provided that where the local/chapter's
constitution and by-laws is the same as that of the federation or national union, this fact shall be
indicated accordingly.

All the foregoing supporting requirements shall be certified under oath by the Secretary or
the Treasurer of the local/chapter and attested to by its President. 50

Department Order No. 9 mentions two labor organizations either of which is allowed to directly
create a local or chapter through chartering – a duly registered federation or a national union.
Department Order No. 9 defines a "chartered local" as a labor organization in the private sector
operating at the enterprise level that acquired legal personality through a charter certificate, issued
by a duly registered federation or national union and reported to the Regional Office in accordance
with Rule III, Section 2-E of these Rules.51

Republic Act No. 9481 or "An Act Strengthening the Workers' Constitutional Right to
SelfOrganization, Amending for the Purpose Presidential Decree No. 442, As Amended, Otherwise
Known as the Labor Code of the Philippines" lapsed52 into law on 25 May 2007 and became
effective on 14 June 2007.53 This law further amends the Labor Code provisions on Labor
Relations.

Pertinent amendments read as follows:

SECTION 1. Article 234 of Presidential Decree No. 442, as amended, otherwise known as
the Labor Code of the Philippines, is hereby further amended to read as follows:

ART. 234. Requirements of Registration. — A federation, national union or industry

or trade union center or an independent union shall acquire legal personality and
shall be entitled to the rights and privileges granted by law to legitimate labor
organizations upon issuance of the certificate of registration based on the following
requirements:

(a) Fifty pesos (P50.00) registration fee;

(b) The names of its officers, their addresses, the principal address of the labor organization,
the minutes of the organizational meetings and the list of the workers who participated in such
meetings;

(c) In case the applicant is an independent union, 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;

(d) If the applicant union has been in existence for one or more years, copies of its annual
financial reports; and

(e) Four copies of the constitution and by-laws of the applicant union, minutes of its adoption
or ratification, and the list of the members who participated in it.

SECTION 2. A new provision is hereby inserted into the Labor Code as Article 234-A to
read as follows:

ART. 234-A. Chartering and Creation of a Local Chapter. — A duly registered

federation or national union may directly create a local chapter by issuing a
charter certificate indicating the establishment of the local chapter. The chapter
shall acquire legal personality only for purposes of filing a petition for
certification election from the date it was issued a charter certificate.

The chapter shall be entitled to all other rights and privileges of a legitimate labor
organization only upon the submission of the following documents in addition to its
charter certificate:

(a) The names of the chapter's officers, their addresses, and the principal office of the
chapter; and

(b) The chapter's constitution and by-laws: Provided, That where the chapter's constitution
and by-laws are the same as that of the federation or the national union, this fact shall be
indicated accordingly.
 The additional supporting requirements shall be certified under oath by the secretary or
treasurer of the chapter and attested by its president. (Emphasis ours.)

Article 234 now includes the term trade union center, but interestingly, the provision indicating the
procedure for chartering or creating a local or chapter, namely Article 234-A, still makes no mention
of a "trade union center."

Also worth emphasizing is that even in the most recent amendment of the implementing rules, 54
there was no mention of a trade union center as being among the labor organizations allowed to
charter.

This Court deems it proper to apply the Latin maxim expressio unius est exclusio alterius. Under this
maxim of statutory interpretation, the expression of one thing is the exclusion of another. When
certain persons or things are specified in a law, contract, or will, an intention to exclude all others
from its operation may be inferred. If a statute specifies one exception to a general rule or assumes
to specify the effects of a certain provision, other exceptions or effects are
excluded.55 Where the terms are expressly limited to certain matters, it may not, by interpretation or
construction, be extended to other matters.56 Such is the case here. If its intent were otherwise, the
law could have so easily and conveniently included "trade union centers" in identifying the labor
organizations allowed to charter a chapter or local. Anything that is not included in the enumeration
is excluded therefrom, and a meaning that does not appear nor is intended or reflected in the very
language of the statute cannot be placed therein. 57 The rule is restrictive in the sense that it
proceeds from the premise that the legislating body would not have made specific enumerations in a
statute if it had the intention not to restrict its meaning and confine its terms to those expressly
mentioned.58 Expressium facit cessare tacitum.59 What is expressed puts an end to what is implied.
Casus omissus pro omisso habendus est. A person, object or thing omitted must have been omitted
intentionally.

Therefore, since under the pertinent status and applicable implementing rules, the power granted to
labor organizations to directly create a chapter or local through chartering is given to a federation or
national union, then a trade union center is without authority to charter directly.

The ruling of this Court in the instant case is not a departure from the policy of the law to foster the
free and voluntary organization of a strong and united labor movement, 60 and thus assure the rights
of workers to self-organization. 61 The mandate of the Labor Code in ensuring strict compliance with
the procedural requirements for registration is not without reason. It has been observed that the
formation of a local or chapter becomes a handy tool for the circumvention of union registration
requirements. Absent the institution of safeguards, it becomes a convenient device for a small group
of employees to foist a not-so-desirable federation or union on unsuspecting co-workers and pare
the need for wholehearted voluntariness, which is basic to free unionism. 62 As a legitimate labor
organization is entitled to specific rights under the Labor Code and involved in activities directly
affecting public interest, it is necessary that the law afford utmost protection to the parties affected. 63
However, as this Court has enunciated in Progressive Development Corporation v. Secretary of
Department of Labor and Employment, it is not this Court's function to augment the requirements
prescribed by law. Our only recourse, as previously discussed, is to exact strict compliance with
what the law provides as requisites for local or chapter formation. 64

In sum, although PDMP as a trade union center is a legitimate labor organization, it has no power to
directly create a local or chapter. Thus, SMPPEU-PDMP cannot be created under the more
lenient requirements for chartering, but must have complied with the more stringent rules for
creation and registration of an independent union, including the 20% membership requirement.

WHEREFORE, the instant Petition is GRANTED. The Decision dated 09 March 2005 of the Court
of Appeals in CA-GR SP No. 66200 is REVERSED and SET ASIDE. The Certificate of
Registration of San Miguel Packaging Products Employees Union–Pambansang Diwa ng
Manggagawang Pilipino is ORDERED CANCELLED, and SMPPEU-PDMP DROPPED from the
rolls of legitimate labor organizations.

Costs against petitioner.

SO ORDERED.

CASE DIGEST FOR SAN

MIGUEL
Topic: Union Registration Requirements

QUICKIE SUMMARY: SM Packing Employees Union is a LOCAL or CHAPTER of PDMP which seeks
to be an INDEPENDENT LABOR ORGANIZATION. For its registration AS A CHAPTER, the applicable
law to them is the D.O. No. 9 which no longer requires the submission of the names of at least 20% of
all its employees in the bargaining unit. San Mig Corp Union claims that SM Packing failed to meet the
requirements set forth by Art 234 of the Labor Code which mandates the submission of the 20% names
and that the Implementing Rules of D.O. No. 9 is violative of Art 234 of the Labor Code because it
provides a less stringent rule (which does not require the submission of the 20% names). SC ruled that
the requirements for the registration of an INDEPENDENT LABOR UNION and the requirements for the
creation of a LOCAL or CHAPTER are different. Since SM Packing seeks to be a legitimate labor
organization, D.O No. 9 is not the one applicable, but Art 234 of the Labor Code.

FACTS:

Petitioner is the incumbent bargaining agent for the bargaining unit comprised of the regular
monthlypaid rank and file employees of the three divisions of San Miguel Corporation namely San
Miguel Corporate Staff Unit (SMCSU), San Miguel Brewing Philippines (SMBP), and the San Miguel
Packaging Products (SMPP)

Respondent is registered as a chapter of Pambansang Diwa ng Manggagawang

Pilipino. Thereafter, respondent filed three separate petitions for certification election to represent
SMPP, SMCSU, and SMBP. All three petitions were dismissed, on the ground that the separate
petitions fragmented a single bargaining unit.

Petitioner filed with the DOLE-NCR a petition seeking the cancellation of respondent’s registration and
its dropping from the rolls of legitimate labor organizations. Petitioner accused respondent of committing
fraud and falsification, and non-compliance with registration requirements in obtaining its certificate of
registration. It raised allegations that respondent violated Articles 239(a), (b) and (c) and 234(c) of the
Labor Code.
DOLE-NCR Regional Director Maximo B. Lim found that respondent did not comply with the 20%
membership requirement and, thus, ordered the cancellation of its certificate of registration and removal
from the rolls of legitimate labor organizations
Bureau of Labor Relations: Reversed DOLE NCR and declared that SM Packing Employees shall
hereby remain in the roster of legitimate labor organizations

CA affirmed BLR

Petitioner’s contention: Petitioner posits that respondent is required to submit a list of members
comprising at least 20% of the employees in the bargaining unit before it may acquire legitimacy, citing
Article 234(c) of the Labor Code. Petitioner also insists that the 20% requirement for registration of
respondent must be based not on the number of employees of a single division, but in all three
divisions of the company in all the offices and plants of SMC since they are all part of one bargaining
unit. Petitioner thus maintains that respondent, in any case, failed to meet this 20% membership
requirement since it based its membership on the number of employees of a single division only,
namely, the SMPP.

ISSUE: W/N SM Packing Employees met the requirements and thus, must remain a legitimate labor
organization

RULING: NO, SM Packing Employees failed to meet the requirement. Hence, they cannot be declared
as a legitimate labor organization

RATIO: A perusal of the records reveals that respondent is registered with the BLR as a local or
chapter of PDMP. The applicable Implementing Rules (Department Order No. 9) enunciates a two-
fold procedure for the creation of a chapter or a local. The first involves the affiliation of an independent
union with a federation or national union or industry union. The second, finding application in the
instant petition, involves the direct creation of a local or a chapter through the process of chartering.
The Implementing Rules stipulate that a local or chapter may be directly created by a federation or
national union.

Petitioner insists that Section 3 of the Implementing Rules, as amended by Department Order No. 9,
violated Article 234 of the Labor Code when it provided for less stringent requirements for the creation
of a chapter or local. Article 234 of the Labor Code provides that an independent labor organization
acquires legitimacy only upon its registration with the BLR: xxx 3) 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; xxx

It is emphasized that the foregoing pertains to the registration of an independent labor organization,
association or group of unions or workers.

However, the creation of a branch, local or chapter is treated differently. This Court, in the landmark
case of Progressive Development Corporation v. Secretary, Department of Labor and Employment,
declared that when an unregistered union becomes a branch, local or chapter, some of the
aforementioned requirements for registration are no longer necessary or compulsory. Whereas
an applicant for registration of an independent union is mandated to submit, among other
things, the number of employees and names of all its members comprising at least 20% of the
employees in the bargaining unit where it seeks to operate, as provided under Article 234 of the
Labor Code and Section 2 of Rule III, Book V of the Implementing Rules, the same is no longer
required of a branch, local or chapter. The intent of the law in imposing less requirements in the
case of a branch or local of a registered federation or national union is to encourage the affiliation of a
local union with a federation or national union in order to increase the local unions bargaining powers
respecting terms and conditions of labor.

DISPOSITIVE: San Miguel Corp Union won. The Certificate of Registration of San Miguel Packaging
Union is ORDERED CANCELLED, and DROPPED from the rolls of legitimate labor organizations.
 DOCTRINE: When an unregistered union becomes a branch, local or chapter, some of the
requirements for registration are no longer necessary or compulsory. Whereas an applicant for
registration of an
independent union is mandated to submit, among other things, the number of employees and names of
all its members comprising at least 20% of the employees in the bargaining unit where it seeks to
operate.

Facts:

San Miguel Corporation Employees Union- Philippines Transport and

General Workers (SMCEU-PTGWO) filed with the DOLE-NCR a
petition seeking the cancellation of San Miguel Packaging Products
Employees Union – Pambansang Diwa ng Manggagawang Pilipino
(SMPPEU-PDMP) registration and its dropping from the rolls of
legitimate labor organizations. DOLE-NCR Regional Director issued
an Order dismissing the allegations. It was found that respondent
did not comply with the 20% membership requirement and, thus,
ordered the cancellation of its certificate of registration and removal
from the rolls of legitimate labor organizations. Respondent
appealed to the Bureau of Labor Relations (BLR).While the BLR
agreed with the findings of the DOLE Regional Director, it reversed
the ruling that the 20% membership is a requirement for respondent
to attain legal personality as a labor organization. The Court of
Appeals, in a Decision dated 9 March 2005, dismissed the petition
and affirmed the decision of the BLR. Hence, this petition for
 certiorari.

Issue:

Whether the respondent is a legitimate labor organization.

Ruling:

When certain persons or things are specified in a law, contract, or

will, an intention to exclude all others from its operation may be
inferred. Such is the case here. If its intent were otherwise, the law
could have so easily and conveniently included “trade union centers”
in identifying the labor organizations allowed to charter a chapter or
local. The rule is restrictive in the sense that it proceeds from the
premise that the legislating body would not have made specific
enumerations in a statute if it had the intention not to restrict its
meaning and confine its terms to those expressly mentioned. Casus
omissus pro omisso habendus est. A person, object or thing omitted
must have been omitted intentionally. Under the pertinent status
and applicable implementing rules, the power granted to labor
organizations to directly create a chapter or local through chartering
is given to a federation or national union, then a trade union center
is without authority to charter directly. Although PDMP as a trade
union center is a legitimate labor organization, it has no power to
directly create a local or chapter.

JOHNSON AND JOHNSON LABOR UNION-FFW, DANTE JOHNSON MORANTE, MYRNA

OLOVEJA AND ITS OTHER INDIVIDUAL UNION MEMBERS, petitioners vs.
DIRECTOR OF LABOR RELATIONS, AND OSCAR PILI, respondents.
The sole issue in this petition for review on certiorari is whether or not the public respondent
committed grave abuse of discretion in ruling that the private respondent is entitled to the financial
aid from the compulsory contributions of the petitioner-union afforded to its members who have
been suspended or terminated from work without reasonable cause.

The provision for the grant of financial aid in favor of a union member is embodied in the
petitioner-union's Constitution and By-laws, Article XIII, Section 5, of which reads:

A member who have (sic) been suspended or terminated without reasonable

cause shall be extended a financial aid from the compulsory contributions in the
amount of SEVENTY FIVE CENTAVOS (P0. 75) from each member weekly. (p.
18, Rollo)

On May 6, 1985, the private respondent, a member of the petitioner-union was dismissed from his
employment by employer Johnson & Johnson (Phil.) Inc., for non-disclosure in his job application
form of the fact that he had a relative in the company in violation of company policies.

On July 1985, a complaint was filed by the private respondent against the officers of the
petitionerunion docketed as NRC- LRD-M-7-271-85 alleging, among others, that the union officers
had refused to provide the private respondent the financial aid as provided in the union
constitution
despite demands for payment thereof The petitioner-union and its officers counter-alleged, in their
answer, that the said financial aid was to be given only in cases of termination or suspension
without any reasonable cause; that the union's executive board had the prerogative to determine
whether the suspension or termination was for a reasonable cause or not; and that the union, in a
general membership meeting, had resolved not to extend financial aid to the private respondent.

While the grievance procedure as contained in the union's collective bargaining agreement was
being undertaken, the private respondent, on August 26, 1985, filed a case for unfair labor
practice and illegal dismissal against his employer docketed as NLRC-NCR Case No. 6-1912-85.

On September 27, 1985, Med-Arbiter Anastacio L. Bactin issued an order dismissing for lack of
merit the complaint of the private respondent against the petitioners for alleged violation of the
union constitution and by-laws.

On appeal, the then public respondent Director Cresenciano B. Trajano, on April 17, 1986,
rendered the decision assailed in this petition. The dispositive portion of the said decision reads:

WHEREFORE, premises considered, the appeal of complainant Oscar Pili is

hereby granted and the Order appealed from is hereby set aside. Appellees,
therefore, are hereby ordered to pay the complainant the sum of P0.75/week per
union member to be computed from the time of the complainant's termination from
employment to the time he acquired another employment should his complaint for
illegal dismissal against the company be resolved in his favor; provided, that if his
complaint against the company be dismissed, appellees are absolved from paying
the complainant anything. (p. 115, Records)

Both parties moved for reconsideration. The petitioners reiterated that since the private
respondent's termination was for a reasonable cause, it would be unjust and unfair if financial aid
were to be given in the event that the latter's case for illegal dismissal is decided against him. The
private respondent, on the other hand, prayed for the amendment of the dispositive portion in
order that the grant of financial aid be made without any qualifications.

On June 16, 1986, a Manifestation and/or Opposition to the Motion for Reconsideration filed by
the petitioners was filed by the private respondent stating that he was being discriminated against
considering that one Jerwin Taguba, another union member, was terminated for dishonesty and
loss of confidence but was granted financial aid by the petitioners while Taguba's complaint
against the company was still pending with the National Labor Relation Commission.

The public respondent separately resolved the above motions. On June 26, 1986, an order was
issued denying the petitioners' motion for reconsideration. On August 19, 1986, the public
respondent modified its decision dated April 17, 1986 and its aforestated order as follows:

Considering that complainant Pili is similarly situated as Jerwin Taguba coupled

with the need to obviate any discriminating treatment to the former, it is only just
and appropriate that our Decision dated 17 April 1986 be modified in such a
manner that respondents immediately pay the complainant the sum of P0.75/ week
per union member to be computed from the time of his dismissal from the
company, without prejudice to refund of the amount that shall be paid to Pili in the
event the pending case is finally resolved against him.

WHEREFORE, and as above qualified, this Bureau's Decision dated 17 April 1986
and the Order dated 26 June 1986 are hereby modified to the extent that the
 respondents are directed to immediately pay complainant the sum of P0.75/week
per union member to be computed from the time of his termination from his
employment until his case against the employer company shall have been finally
resolved and/or disposed. (p. 53, Rollo)

Meanwhile, on July 25, 1986, a motion for issuance of a writ of execution was filed by the private
respondent in order to collect from the petitioners the amount of financial aid to which the former
was entitled.

On September 1, 1986, the petitioners moved for a reconsideration of the public respondent's
resolution dated August 19, 1986 on the grounds that Taguba's affidavit cannot support the private
respondent's claim that he is also entitled to the financial aid provided in the union's constitution
and that the union cannot be compelled to grant the said aid in the absence of a special fund for
the purpose.

On October 28, 1986, the public respondent through Director Pura Ferrer-Calleja denied the
petitioners' motion for reconsideration stating that Article XIII, Section 5 of the union's constitution
and by-laws does not require a special fund so that all union members similarly situated as the
private respondent must be entitled to the same right and privilege regarding the grant of financial
aid as therein provided.

On December 18, 1986, a writ of execution was issued by the public respondent in the following
tenor:

NOW THEREFORE, you are hereby directed to proceed to the premises of

Johnson and Johnson (FFW) located at Edison Road, Bo. Ibayo, Paranaque,
Metro Manila to collect from the said union through its Treasurer, Myrna Oloveja or
to any responsible officer of the union the amount of Twenty Thousand Five
Hundred Twenty Pesos (P20,520.00), more or less representing financial
assistance to complainant under the union's constitution and by-laws. In case you
fail to collect said amount in cash, you are to cause the satisfaction of the same on
the union's movable or immovable properties not exempt from execution. You are
to return this writ within fifteen (15) days from your compliance hereby together
with your report thereon. You may collect your legal fees from the respondent
union. (p. 55, Rollo)

On December 24, 1986, the instant petition was filed with prayer for a preliminary injunction. The
temporary restraining order issued by the Chief Justice on December 24, 1986 was confirmed in
our resolution dated January 7, 1987.

The grounds relied upon by the petitioners are as follows:

A. THAT THE DECISION/ORDER IN QUESTION IS CONTRARY TO LAW.

B. THAT RESPONDENT OFFICIAL ACTED WITH GRAVE ABUSE OF DISCRETION

AMOUNTING TO LACK OF JURISDICTION.

C. THAT WITH RESPECT TO PETITIONING MEMBERS, THEY HAVE BEEN

DEPRIVED OF THEIR CONSTITUTIONAL RIGHT TO DUE PROCESS OF LAW.
(P. 13, Rollo)
We find unmeritorious the contention of the petitioners that the questioned decision and order are
contrary to law for being tantamount to compelling the union to disburse it funds without the
authority of the general membership and to collect from its members without the benefit of
individual payroll authorization.

Section 5, Article XIII of the petitioner-union's constitution and by-laws earlier aforequoted is
selfexecutory. The financial aid extended to any suspended or terminated union member is
realized from the contributions declared to be compulsory under the said provision in the amount
of seventy-five centavos due weekly from each union member. The nature of the said contributions
being compulsory and the fact that the purpose as stated is for financial aid clearly indicate that
individual payroll authorizations of the union members are not necessary. The petitioner-union's
constitution and by-laws govern the relationship between and among its members. As in the
interpretation of contracts, if the terms are clear and leave no doubt as to the intention of the
parties, the literal meaning of the stipulations shall control. (See Government Service Insurance
System v. Court of Appeals, 145 SCRA 311 [1986]). Section 5, Article XIII of the said constitution
and by-laws is in line with the petitioner- union's aims and purposes which under Sec. 2, Article II
include

To promote, establish and devise schemes of mutual assistance among the

members in labor disputes.

Thus, there is no doubt that the petitioner-union can be ordered to release its funds intended for
the promotion of mutual assistance in favor of the private respondent.

We likewise find untenable the argument of the petitioners that the public respondent, in granting
financial aid to the private respondent, in effect, substituted the decision of the petitioner-union to
do otherwise and that in so doing, the public respondent gravely abused its discretion amounting
to lack of jurisdiction. The union constitution is a covenant between the union and its members and
among the members. There is nothing in their constitution which leaves the legal
interpretation of its terms unilaterally to the union or its officers or even the general membership. It
is noteworthy to quote the ruling made by the public respondent in this respect, to wit:

The union constitution and by-laws clearly show that any member who is
suspended or terminated from employment without reasonable cause is entitled to
financial assistance from the union and its members. The problem, however, is
that the constitution does not indicate which body has the power to determine
whether a suspension or dismissal is for reasonable cause or not. To our mind, the
constitution's silence on this matter is a clear recognition of the labor arbiter's
exclusive jurisdiction over dismissal cases. After all, the union's constitution and
by-laws is valid only insofar as it is not inconsistent with existing laws. ... . (BLR
decision, p. 2; p. 115, Records)

An aggrieved member has to resort to a government agency or tribunal. Considering that

quasijudicial agencies like the public respondent's office have acquired expertise since their
jurisdiction is confined to specific matter, their findings of fact in connection with their rulings are
generally accorded not only respect but at times even finality if supported by substantial evidence.
(See
Manila Mandarin Employees Union v. National Labor Relations Commission, 154 SCRA 368
[1987]) Riker v. Ople, 155 SCRA 85 [1987]; and Palencia v. National Labor Relations
Commission, 153 SCRA 247 [1987]. We note from the records that the petitioners have conflicting
interpretations of the same disputed provision one in favor of Jerwin Taguba and another against
the private respondent.
On the ancillary issue presented by the petitioners whether or not the petitioning union members
have been deprived of their right to due process of law because they were never made parties to
the case under consideration, we rule that the fact that the union officers impleaded since the
inception of the case acted in a representative capacity on behalf of the entire union's
membership substantially meets the requirements of due process with respect to the said union
members. Moreover, the complaint filed against the union involves the interpretation of its
constitution favoring an aggrieved member. The members are bound by the terms of their own
constitution. A suit to enforce a union constitution does not have to be brought against each
individual member, especially where several thousand members form the membership. If there is
any violation of the right to due process in the case at bar it is as regards the private respondent
since the petitionersunion has dispensed with due process in deciding not to extend financial aid
to the private respondent in the absence yet of a ruling by the labor arbiter on whether his
dismissal was for a reasonable cause or not.

The remedy of the petitioners is to strike out or amend the objectionable features of their
constitution. They cannot expect the public respondent to assist them in its non- enforcement or
violation.

WHEREFORE, PREMISES CONSIDERED, the instant petition is hereby DISMISSED in the

absence of a showing of grave abuse of discretion on the part of the public respondent. The
decision of the public respondent dated April 17, 1986 as modified in a resolution dated August
17, 1986 is AFFIRMED. The temporary restraining order issued by the Court on December
24,1986 is SET ASIDE.
CASE DIGEST

VILLAR v. INCIONG

The facts are as follows:

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 private respondent Amigo Manufacturing, Inc. (hereinafter referred to as Company).
The Company and the Amigo Employees Union-PAFLU had a collective bargaining agreement
governing their labor relations, which agreement was then about to expire on February 28, 1977.
Within the last sixty (60) days of the CBA, events transpired giving rise to the present dispute.

On January 5, 1977, 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 with the Med-Arbiter's Office, Regional Office No. 4 of the
 Ministry of Labor and Employment. The petition was, however, opposed by the Philippine
Association of Free Labor Unions (hereinafter referred to as PAFLU) with whom, as stated
earlier, the Amigo Employees Union was at that time affiliated. PAFLU's opposition cited the
"Code of Ethics" governing inter-federation 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.

On February 7, 1977, the same employees who had signed the petition filed by FUR signed a joint
resolution reading in toto as follows:

Sama-Samang Kapasiyahan

1. TUMIWALAG bilang kasaping Unyon ng Philippine Association of Free Labor Unions

(PAFLU) at kaalinsabay nito, inaalisan namin ang PAFLU ng kapangyarihan na katawanin kami sa
anumang pakikipagkasundo (CBA) sa Pangasiwaan ng aming pinapasukan at kung sila man ay
nagkasundo o magkakasundo sa kabila ng pagtitiwalag na ito, ang nasabing kasunduan ay hindi
namin pinagtitibay at tahasang aming itinatakwil/tinatanggihan;

2. BINABAWI namin ang aming pahintulot sa Federation of Unions of Rizal (FUR) na

katawanin kami sa Petition for Certification Election (RO4-MED Case No. 74377) at/o sa sama-
samang pakikipagkasundo sa aming patrons;

3. PANATILIHIN na nagsasarili (independent) ang aming samahan, AMIGO EMPLOYEES'

UNION, alinsunod sa Artikulo 240 ng Labor Code;

4. MAGHAIN KAAGAD ang aming Unyong nagsasarili, sa pamumuno ng aming

pangsamantalang Opisyal na kinatawan, si Ginang DOLORES VILLAR, ng Petition for
Certification Election sa Department of Labor, para kilalanin ang aming Unyong nagsasarili bilang
Tanging kinatawan ng mga manggagawa sa samasamang pakikipagkasundo (CBA);

5. BIGYAN ng kopya nito ang bawa't kinauukulan at ang mga kapasiyahang ito ay
magkakabisa sa oras na matanggap ng mga kinauukulan ang kani-kanilang sipi
nito.
1

Immediately thereafter or on February 9, 1977, petitioner Dolores Villar, representing herself to be

the authorized representative of the Amigo Employees Union, filed a petition for certification
election in the Company before Regional Office No. 4, with the Amigo Employees Union as the
petitioner. 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.
Finding that the petition involved the same parties and causes of action as the case previously
indorsed to the TUCP, the Med-Arbiter dismiss 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 and one Felipe Manlapao, for "continuously maligning,
libelling and slandering not only the incumbent officers but even the union itself and the
federation;" spreading 'false propaganda' that the union officers were 'merely appointees of the
management', and for causing divisiveness in the union.

Pursuant to the Resolution approved by the Amigo Employees Union- PAFLU, the PAFLU,
through its national President, formed a Trial Committee to investigate the local union's charges
against the petitioners for acts of disloyalty inimical to the interest of the local union, as well as
directing the Trial Committee to subpoena the complainants (Amigo Employees Union-PAFLU)
and the respondents (herein petitioners) for investigation, to conduct the said investigation and to
submit its findings and recommendations for appropriate action.

And on the same date of February 15, 1977, the Amigo Employees Union- PAFLU and the
Company concluded a new CBA which, besides granting additional benefits to the workers, also
reincorporated the same provisions of the existing CBA, including the union security clause
reading, to wit:

ARTICLE III
UNION SECURITY WITH RESPECT TO PRESENT MEMBERS

All members of the UNION as of the signing of this Agreement shall remain
members thereof in good standing. Therefore, any members who shall resign, be
expelled, or shall in any manner cease to be a member of the UNION, shall be
dismissed from his employment upon written request of the UNION to the
Company. 2

Subsequently, petitioners were summoned to appear before the PAFLU Trial

Committee for the aforestated investigation of the charges filed against them by
the Amigo Employees Union-PAFLU. Petitioners, however, did not attend but
requested for a "Bill of Particulars" of the charges, which charges were stated by
the Chairman of the committee as follows:

1. Disaffiliating from PAFLU and affiliating with the Federation of Unions of Rizal (FUR).

2. Filling petition for certification election with the Bureau of Labor Relations and docketed as
Case No. R04-MED-830-77 and authorizing a certain Dolores Villar as your authorized
representative without the official sanction of the mother Federation- PAFLU.

3. Maligning, libelling and slandering the incumbent officers of the union as well as of the
PAFLU Federation.
4. By spreading false propaganda among members of the Amigo Employees Union-PAFLU
that the incumbent union officers are 'merely appointees' of the management.

5. By sowing divisiveness instead of togetherness among members of the Amigo Employees

Union-PAFLU.

6. By conduct unbecoming as members of the Amigo Employees Union- PAFLU which is

highly prejudicial to the union as well as to the PAFLU Federation.

All these charges were formalized in a resolution of the incumbent officers of the
Amigo Employees Union-PAFLU dated February 14, 1977. 3

Not recognizing PAFLU's jurisdiction over their case, petitioners again refused to participate in
the investigation rescheduled and conducted on March 9, 1979. Instead, petitioners merely
appeared to file their Answer to the charges and moved for a dismissal.

Petitioners contend in their Answer that neither the disaffiliation of the Amigo Employees Union
from PAFLU nor the act of filing the petition for certification election constitute disloyalty as these
are in the exercise of their constitutional right to self-organization. They further contended that
PAFLU was without jurisdiction to investigate their case since the charges, being intra-union
problems within the Amigo Employees Union-PAFLU, should be conducted pursuant to the
provisions of Article XI, Sections 2, 3, 4 and 5 of the local union's constitution and by-laws.

The complainants, all of whom were the then incumbent officers of the Amigo Employees
UnionPAFLU, however, appeared and adduced their evidence supporting the charges against
herein petitioners.

Based on the findings and recommendations of the PAFLU trial committee, the PAFLU
President, on March 15, 1977, rendered a decision finding the petitioners guilty of the charges
and disposing in the last paragraph thereof, to wit,

Excepting Felipe Manlapao, the expulsion from the AMIGO EMPLOYEES UNION of all the other
nine (9) respondents, Dionisio Ramos, Recitation Bernus, Dolores
Villar, Romeo Dequito, Rolando de Guzman, Anselma Andan, Rita Llagas, Benigno Mamaradlo
and Orlando Acosta is hereby ordered, and as a consequence the Management of the
employer, AMIGO MANUFACTURING, INC. is hereby requested to terminate them from their
employment in conformity with the security clause in the collective bargaining agreement.
Further, the Trial Committee is directed to investigate Felipe Manlapao when he shall have
reported back for duty. 4

Petitioners appealed the Decision to the PAFLU, citing the same grounds as before, and in
addition thereto, argued that the PAFLU decision cannot legally invoke a CBA which was
unratified, not certified, and entered into without authority from the union general membership, in
asking the Company to terminate them from their employment. The appeal was, likewise, denied
by PAFLU in a Resolution dated March 28, 1977.

After denying petitioner's appeal, PAFLU on March 28, 1977 sent a letter to the Company
stating, to wit,
 We are furnishing you a copy of our Resolution on the Appeal of the respondent
in Administrative Case No. 2, Series of 1977, Amigo Employees Union-PAFLU
vs. Dionisio Ramos, et al.

In view of the denial of their appeal and the Decision of March 15, 1977 having
become final and executory we would appreciate full cooperation on your part by
implementing the provision of our CBA on security clause by terminating the
respondents concerned from their employment. 5

This was followed by another letter from PAFLU to the Company dated April 25, 1977, reiterating
the demand to terminate the employment of the petitioners pursuant to the security clause of the
CBA, with a statement absolving the Company from any liability or damage that may arise from
petitioner's termination.

Acting on PAFLU's demand, the Company informed PAFLU that it will first secure the necessary
clearances to terminate petitioners. By letter dated April 28, 1977, PAFLU requested the
Company to put petitioners under preventive suspension pending the application for said
clearances to terminate the petitioners, upon a declaration that petitioners' continued stay within
the work premises will "result in the threat to the life and limb of the other employees of the
company." 6

Hence, on April 29, 1977, the Company filed the request for clearance to terminate the
petitioners before the Department of Labor, Regional Office No. 4. The application, docketed as
RO4-Case No. 7-IV-3549-T, stated as cause therefor, "Demand by the Union Pursuant to the
Union Security Clause," and further, as effectivity date, "Termination-upon issuance of
clearance; Suspensionupon receipt of notice of workers concerned." Petitioners were then
7

informed by memorandum dated April 29, 1977 that the Company has applied for clearance to
terminate them upon demand of PAFLU, and that each of them were placed under preventive
suspension pending the resolution of the said applications. The security guard was, likewise,
notified to refuse petitioners entry into the work premises.8

In an earlier development, on April 25, 1977, or five days before petitioners were placed under
preventive suspension, they filed a complaint with application for preliminary injunction before
the same Regional Office No. 4, docketed as RO4-Case No. RD-4-4088-77-T, praying that after
due notice and hearing, "(1) A preliminary injunction be issued forthwith to restrain the
respondents from doing the act herein complained of, namely: the dismissal of the individual
complainants from their employment; (2) After due hearing on the merits of the case, an Order
be entered denying and/or setting aside the Decision dated March 15, 1977 and the Resolution
dated March 28, 1977, issued by respondent Onofre P. Guevara, National President of
respondent PAFLU; (3) The Appeal of the individual complainants to the General Membership of
the complainant AMIGO EMPLOYEES UNION, dated March 22, 1977, pursuant to Sections 2,
3, 4 & 5, Article XI in relation of Section 1, Article XII of the Union Constitution and By-Laws, be
given due course; and (4) Thereafter, the said preliminary injunction be made permanent, with
costs, and with such further orders/reliefs that are just and equitable in the premises."
9

In these two cases filed before the Regional Office No. 4, the parties adopted their previous
positions when they were still arguing before the PAFLU trial committee.
On October 14, 1977, Vicente Leogardo, Jr., Officer-in-Charge of Regional Office No. 4,
rendered a decision jointly resolving said two cases, the dispositive portion of which states, to
wit,

IN VIEW OF THE FOREGOING, judgment is hereby rendered granting the

application of the Amigo Manufacturing, Inc., for clearance to terminate the
employment of Dolores D. Villar, Dionisio Ramos, Benigno Mamaraldo, Orlando
Acosta, Recitacion Bernus, Anselma Andan, Rolando de Guzman, and Rita
Llagas. The application of oppositors, under RO4-Case No. RD-4-4088-77, for a
preliminary injunction to restrain the Amigo Manufacturing, Inc. from terminating
their employment and from placing them under preventive suspension, is hereby
DISMISSED. 10

Not satisfied with the decision, petitioners appealed to the Office of the Secretary of Labor. By
Order dated February 15, 1979, the respondent Amado G. Inciong, Deputy Minister of Labor,
dismissed their appeal for lack of merit. 11

Hence, the instant petition for review, raising the following issues:

A. Is it not error in both constitutional and statutory law by the respondent

Minister when he affirmed the decision of the RO4-Officer-in-Charge allowing the
preventive suspension and subsequent dismissal of petitioners by reason of the
exercise of their right to freedom of association?

B. Is it not error in law by the respondent Minister when he upheld the

decision of the RO4 OIC which sustained the availment of the respondent
PAFLU's constitution over that of the local union constitution in the settlement of
intra-union dispute?

C. Is it not error in law amounting to grave abuse of discretion by the Minister

in affirming the conclusion made by the RO4 OIC, upholding the legal applicability
of the security clause of a CBA over alleged offenses committed earlier than its
conclusion, and within the 60-day freedom period of an old CBA? 12

The main thrust of the petition is the alleged illegality of the dismiss 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
UnionPAFLU. Petitioners contend that the respondent Deputy Minister acted in grave abuse of
discretion when he affirmed the decision granting the clearance to terminate the petitioners and
dismissed petitioners' complaint, and in support thereof, allege that their constitutional right to
selforganization had been impaired. Petitioner's contention lacks merit.

It is true that disaffiliation from a labor union is not open to legal objection. It is implicit in the
freedom of association ordained by the Constitution. But this Court has laid down the ruling
13

that a closed shop is a valid form of union security, and such provision in a collective bargaining
agreement is not a restriction of the right of freedom of association guaranteed by the
Constitution. 14
In the case at bar, it appears as an undisputed fact that on February 15, 1977, 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
UnionPAFLU on March 15, 1977 pursuant to the Decision of the PAFLU national president.

We reject petitioners' theory that their expulsion was not valid upon the grounds adverted to
earlier in this Decision. That 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. And pursuant to the security
clause of the new CBA, reiterating the same clause in the old CBA, PAFLU was justified in
applying said security clause. We find no abuse of discretion on the part of the OIC of Regional
Office No. 4 in upholding the validity of the expulsion and on the part of the respondent Deputy
Minister of Labor in sustaining the same. We agree with the OIC's decision, pertinent portion of
which reads:

Stripped of non-essentials, the basic and fundamental issue in this case tapers
down to the determination of WHETHER OR NOT PAFLU HAD THE
AUTHORITY
TO INVESTIGATE OPPOSITORS AND, THEREAFTER, EXPEL THEM FROM
THE ROLL OF MEMBERSHIP OF THE AMIGO EMPLOYEES UNION-PAFLU.

Recognized and salutary is the principle that when a labor union affiliates with a
mother union, it becomes bound by the laws and regulations of the parent
organization. Thus, the Honorable Secretary of Labor, in the case of Amador
Bolivar, et al. vs. PAFLU, et al., NLRC Case No. LR-133 & MC-476, promulgated
on December 3, 1973, declared-

When a labor union affiliates with a parent organization or mother union, or

accepts a charter from a superior body, it becomes subject to the laws of the
superior body under whose authority the local union functions. The constitution,
by-laws and rules of the parent body, together with the charter it issues pursuant
thereto to the subordinate union, constitute an enforceable contract between the
parent body and the subordinate union, and between the members of the
subordinate union inter se. (Citing Labor Unions, Dangel and Shriber, pp.
279280).

It is undisputable that oppositors were members of the Amigo Employees Union

at the time that said union affiliated with PAFLU; hence, under the afore-quoted
principle, oppositors are bound by the laws and regulations of PAFLU.

Likewise, it is undeniable that in the investigation of the charges against them,

oppositors were accorded 'due process', because in this jurisdiction, the doctrine
is deeply entrenched that the term 'due process' simply means that the parties
were given the opportunity to be heard. In the instant case, ample and
unmistakable evidence exists to show that the oppositors were afforded the
opportunity to present their evidence, but they themselves disdained or spurned
the said opportunity given to them.

PAFLU, therefore, correctly and legally acted when, pursuant to its Constitution
and By-Laws, it conducted and proceeded with the investigation of the charges
against the oppositors and found them guilty of acts prejudicial and inimical to the
interests of the Amigo Employees Union- PAFLU, to wit: that of falsely and
maliciously slandering the officers of the union; spreading false propaganda
among the members of the Amigo Employees Union-PAFLU; calling the
incumbent officers as mere appointees and robots of management; calling the
union company-dominated or assisted union; committing acts unbecoming of the
members of the union and destructive of the union and its members.
 Inherent in every labor union, or any organization for that matter, is the right of self-
preservation. When members of a labor union, therefore, sow the seeds of
dissension and strife within the union; when they seek the disintegration and
destruction of the very union to which they belong, they thereby forfeit their rights
to remain as members of the union which they seek to destroy. Prudence and
equity, as well as the dictates of law and justice, therefore, compelling mandate the
adoption by the labor union of such corrective and remedial measures in keeping
with its laws and regulations, for its preservation and continued existence; lest by
its folly and inaction, the labor union crumble and fall.

Correctly and legally, therefore, the PAFLU acted when, after proper investigation
and finding of guilt, it decided to remove the oppositors from the list of members of
the Amigo Employees Union-PAFLU, and thereafter, recommended to the Amigo
Manufacturing, Inc.; the termination of the employment of the oppositors. 15

We see no reason to disturb the same.

The contention of petitioners that the charges against them being intra-union problems, should
have been investigated in accordance with the constitution and by-laws of the Amigo Employees
Union-PAFLU and not of the PAFLU, is not impressed with merit. 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. Thus, in Kapisanan ng mga Manggagawa sa MRR vs. Hernandez, 20
SCRA 109, We held:

In the case at bar, noteworthy is the fact that the complaint was filed against the
union and its incumbent officers, some of whom were members of the board of
directors. The constitution and by-laws of the union provide that charges for any
violations thereof shall be filed before the said board. But as explained by the lower
court, if the complainants had done so the board of directors would in effect be
acting as respondent investigator and judge at the same time. To follow the
procedure indicated would be a farce under the circumstances, where exhaustion
of remedies within the union itself would practically amount to a denial of justice or
would be illusory or vain, it will not be insisted upon, particularly where property
rights of the members are involved, as a condition to the right to invoke the aid of a
court.

The facts of the instant petition stand on all fours with the aforecited case that the principle therein
enunciated applies here as well. In the case at bar, the petitioners were charged by the officers of
the Amigo Employees Union- PAFLU themselves who were also members of the Board of
Directors of the Amigo Employees Union-PAFLU. Thus, were the petitioners to be charged and
investigated according to the local union's constitution, they would have been tried by a trial
committee of three (3) elected from among the members of the Board who are themselves the
accusers. (Section 2, Article 11, Constitution of the Local Union). Petitioners would be in a far
worse position had this procedure been followed. Nonetheless, petitioners admit in their petition
that two (2) of the six (6) charges, i.e. disaffiliation and filing a petition for certification election, are
not intra-union matters and, therefore, are cognizable by PAFLU.

Petitioners insist that their disaffiliation from PAFLU and filing a petition for certification election are
not acts of disloyalty but an exercise of their right to self-organization. They contend that these
acts were done within the 60-day freedom period when questions of representation may freely be
raised. Under the peculiar facts of the case, We find petitioners' insistence untenable.

In the first place, had petitioners merely disaffiliated from the. Amigo Employees Union-PAFLU,
there could be no legal objections thereto for it was their right to do so. But what petitioners did by
the very clear terms of their "Sama-Samang Kapasiyahan" was to disaffiliate the Amigo
Employees Union-PAFLU from PAFLU, an act which they could not have done with any effective
consequence because they constituted the minority in the Amigo Employees Union-PAFLU.

Extant from the records is the fact that petitioners numbering ten (10), were among the ninety-six
(96) who signed the "Sama-Samang Kapasiyahan" whereas there are two hundred thirty four (234)
union members in the Amigo Employees Union-PAFLU. Hence, petitioners constituted a small
minority for which reason they could not have successfully disaffiliated the local union from
PAFLU. Since only 96 wanted disaffiliation, it can be inferred that the majority wanted the union to
remain an affiliate of PAFLU and this is not denied or disputed by petitioners. The action of the
majority must, therefore, prevail over that of the minority members. 16

Neither is there merit to petitioners' contention that they had the right to present representation
issues within the 60-day freedom period. It is true, as contended by petitioners, that under Article
257 of the Labor Code and Section 3, Rule 2, Book 2 of its Implementing Rules, questions of
exclusive bargaining representation are entertainable within the sixty (60) days prior to the expiry
date of an existing CBA, and that they did file a petition for certification election within that period.
But the petition was filed in the name of the Amigo Employees Union which had not disaffiliated
from PAFLU, the mother union. Petitioners being a mere minority of the local union may not bind
the majority members of the local union.

Moreover, the Amigo Employees Union, as an independent union, is not duly registered as such
with the Bureau of Labor Relations. The appealed decision of OIC Leogardo of Regional Office
No. 4 states as a fact that there is no record in the Bureau of Labor Relations that the Amigo
Employees Union (Independent) is registered, and this is not disputed by petitioners,
notwithstanding their allegation that the Amigo Employees Union is a duly registered labor
organization bearing Ministry of Labor Registration Certification No. 5290-IP dated March 27,
1967. But the independent union organized after the "Sama-Samang Kapasiyahan" executed
February 7, 1977 could not have been registered earlier, much less March 27, 1967 under
Registration Certificate No. 5290-IP. As such unregistered union, it acquires no legal personality
and is not entitled to the rights and privileges granted by law to legitimate labor organizations upon
issuance of the certificate of registration. Article 234 of the New Labor Code specifically provides:

Art. 234. Requirements of Registration.—Any applicant labor organization,

association, or group of unions or workers shall acquire legal personality and shall
be entitled to the rights and privileges granted by law to legitimate labor
organizations upon issuance of the certificate of registration. ....

In Phil. Association of Free Labor Unions vs. Sec. of Labor, 27 SCRA 40, We had occasion to
interpret Section 23 of R.A. No. 875 (Industrial Peace Act) requiring of labor unions registration by
the Department of Labor in order to qualify as "legitimate labor organization," and We said:

The theory to the effect that Section 23 of Republic Act No. 875 unduly curtails the
freedom of assembly and association guaranteed in the Bill of Rights is devoid of
factual basis. The registration prescribed in paragraph (b) of said section is not a
17

limitation to the right of assembly or association, which may be exercised with or

 without said registration. The latter is merely a condition sine qua non for the

acquisition of legal personality by labor organizations, associations or unions and

the possession of the 'rights and privileges granted by law to legitimate labor
organizations.' The Constitution does not guarantee these rights and privileges,
much less said personality, which are mere statutory creations, for the possession
and exercise of which registration is required to protect both labor and the public
against abuses, fraud, or impostors who pose as organizers, although not truly
accredited agents of the union they purport to represent. Such requirement is a
valid exercise of the police power, because the activities in which labor
organizations, associations and union or workers are engaged affect public
interest, which should be protected.

Simply put, the Amigo Employees Union (Independent) Which petitioners claim to represent, not
being a legitimate labor organization, may not validly present representation issues. Therefore, the
act of petitioners cannot be considered a legitimate exercise of their right to self-organization.
Hence, We affirm and reiterate the rationale explained in Phil Association of Free Labor Unions
vs. Sec. of Labor case, supra, in order to protect legitimate labor and at the same time maintain
discipline and responsibility within its ranks.

The contention of petitioners that the new CBA concluded between Amigo Employees
UnionPAFLU and the Company on February 15, 1977 containing the union security clause cannot
be invoked as against the petitioners for offenses committed earlier than its conclusion, deserves
scant consideration. We find it to be the fact that 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 Union-PAFLU 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. The "closed-shop provision" in the CBA provides:

All members of the UNION as of the signing of this Agreement shall remain
members thereof in good standing. Therefore, any members who shall resign, be
expelled, or shall in any manner cease to be a member of the UNION, shall be
dismissed from his employment upon written request of the UNION to the
Company. (Art. III)

A closed-shop is a valid form of union security, and a provision therefor in a collective bargaining
agreement is not a restriction of the right of freedom of association guaranteed by the
Constitution. (Manalang, et al. vs. Artex Development Co., Inc., et al., L-20432, October 30, 1967,
21 SCRA 561). Where in a closed-shop agreement it is stipulated that union members who cease
to be in good standing shall immediately be dismissed, such dismissal does not constitute an
unfair labor practice exclusively cognizable by the Court of Industrial Relations. (Seno vs.
Mendoza, 21 SCRA 1124).

Finally, We reject petitioners' contention that respondent Minister committed error in law amounting
to grave abuse of discretion when he affirmed the conclusion made by the RO4 OIC, upholding the
legal applicability of the security clause of a CBA over alleged offenses committed earlier than its
conclusion and within the 60-day freedom period of an old CBA. In the first place, as We stated
earlier, the security clause of the new CBA is a reproduction or reiteration of the same clause in
the old CBA. While petitioners were charged for alleged commission of acts of disloyalty inimical to
the interests of the Amigo Employees Union-PAFLU in the Resolution of February 14, 1977 of the
Amigo Employees Union- PAFLU and on February 15, 1977 PAFLU and the Company entered
into and concluded a new collective bargaining agreement, petitioners may not escape the effects
of the security clause under either the old CBA or the new CBA by claiming that the old CBA had
expired and that the new CBA cannot be given retroactive enforcement. To
 do so would be to create a gap during which no agreement would govern, from the time the old
contract expired to the time a new agreement shall have been entered into with the union. As this
Court said in Seno vs. Mendoza, 21 SCRA 1124, "without any agreement to govern the relations
between labor and management in the interim, the situation would well be productive of confusion
and result in breaches of the law by either party. "

The case of Seno vs. Mendoza, 21 SCRA 1124 mentioned previously needs further citation of the
facts and the opinion of the Court, speaking through Justice Makalintal who later became Chief
Justice, and We quote:

It appears that petitioners other than Januario T. Seno who is their counsel, were
members of the United Seamen's Union of the Philippines. Pursuant to a
letterrequest of the Union stating that they 'had ceased to be members in good
standing' and citing a closed shop clause in its bargaining agreement with
respondent Carlos A. Go Thong & Co., the latter dismissed said petitioners.
Through counsel, petitioners requested that they be reinstated to their former
positions and paid their backwages, otherwise they would picket respondents'
offices and vessels. The request was denied on the ground that the dismissal was
unavoidable under the terms of the collective bargaining agreement. ...

We, therefore, hold and rule that petitioners, although entitled to disaffiliate from their union and
form a new organization of their own, must, however, suffer the consequences of their separation
from the union under the security clause of the CBA.

WHEREFORE, IN VIEW OF ALL THE FOREGOING, the Order appealed from affirming the joint
decision of the OIC of Regional Office No. 4 in RO4-Case No. T-IV-3549-T and RO4 Case No. RD-
4-4088-77-T granting clearance to terminate petitioners as well as dismissing their complaint with
application for preliminary injunction, is hereby AFFIRMED. No costs.

SO ORDERED.

CASE
DIGEST
FACTS:

The petitioners, who are the disaffiliating union members insist that their di saffiliation from
PAFLU and filing a petition for certification election are not acts of disloyalty but an exercise of
their right to self-
organization. The contention was that these acts were done within the 60day freedom period
when questions of representation may freely be raised.

ISSUE:
Whether or not the disaffiliation from its mother union is justified consideri ng it was done
during the freedom period.

RULING:

No, it must be supported by the majority of the union members. In the first pl ace, had
petitioners merely disaffiliated from the. Amigo Employees UnionPAFLU, there could be no
legal objections thereto for it was their right to do s o. But what petitioners did by the very
clear terms of their “Sama-
Samang Kapasiyahan” was to disaffiliate the Amigo Employees UnionPAFLU from PAFLU, an
act which they could not have done with any effective consequence because they
constituted the minority in the Amigo Employees Union-PAFLU.

Extant from the records is the fact that petitioners numbering ten (10), were among the
ninety-six (96) who signed the “Sama-
Samang Kapasiyahan” whereas there are two hundred thirty four (234) unio n members in
the Amigo Employees Union-
PAFLU. Hence, petitioners constituted a small minority for which reason the y could not have
successfully disaffiliated the local union from PAFLU. Since only 96 wanted disaffiliation, it
can be inferred that the majority wanted the union to remain an affiliate of PAFLU and this is
not denied or disputed by pe titioners. The action of the majority must, therefore, prevail
over that of the minority members.