Labor Relations: Unfair Labor Practices

Article 258. [247] Concept of Unfair Labor Practice and Procedure for Prosecution Thereof.

Unfair Labor practices violates the constitutional right of workers and employees to self-
organization, are inimical to the legitimate interests of both labor and management, including
their right to bargain collectively and otherwise deal with each other in an atmosphere of
freedom and mutual respect, disrupt industrial peace and hinder the promotion of healthy and
stable labor management relations.

Consequently, unfair labor practices are not only violations of the civil rights of both labor and
management but are also criminal offenses against the State which shall be subject to
prosecution and punishment as herein provided.

> Paragraph 1 deals with the violations of an unfair labor practice. Specifically, it stated that it is
against the constitutional right of workers and employees to self-organization. Hence, it obstructs
the legitimate interests of both labor and management. Furthermore, this paragraph also states that
it disrupts industrial peace and hinder the promotion of healthy and stable labor management.

> On the other hand, paragraph 2 stated that these are not only in violative of the civil rights of the
labor and management but are criminal offenses against the sate as well. Hence, it shall be subject
to prosecution and punishment.

> Nature of Unfair Labor Practices (ULP)

1. Violate the constitutional right of workers and employees to self-organization;
2. Inimical to the legitimate interests of both labor and management, including their right
to bargain collectively and otherwise deal with each other in an atmosphere of freedom
and mutual respect;
3. Disrupt industrial peace; and
4. Hinder the promotion of healthy and stable labor-management relations.

> Aim of labor relations policy is industrial democracy whose realization is most felt in free
collective bargaining or negotiation over terms and conditions of employment. But for bargaining
negotiation to be true and meaningful, the employees, first of all, must organize themselves.
Because self-organization is a prerequisite - the lifeblood - of industrial democracy, the right to
self-organize has been enshrined in the Constitution, and any act intended to weaken or defeat the
right is regarded by law as an offense (ULP).

> Elements
1. Employer-Employee Relationship
 – Required because ULP is a negotiation of the right to organize which is available
only to employees in relation to their employer. Walang ULP kung wala nito.
2. Act done is expressly defined in the Code as an act of unfair labor practice
– Prohibited acts are all related to the worker’s self-organizational right and to the
observance of a CBA. Exception to this is Art. 248(f) (OLD PROVISION) referring
to dismissing or prejudicing an employee giving testimony under this code.
– Because ULP is and has to be related to the right to self-organization and to the
observance of the CBA, it follows that not every unfair act is unfair labor
practice.
– THEREFORE: ULP has a limited, technical meaning because it is a labor relations
concept with a statutory definition. It refers only to acts opposed to worker’s
right to organize. Without this element, the act, no matter how unfair, is not ULP
as legally defined.

Subject to the exercise by the president or by the secretary of labor and employment of the
powers vested in them by Arts. 263 and 264 of this code, the civil aspects of all cases involving
unfair labor practices, which may include claims for actual, moral, exemplary and other forms of
damages, attorney’s fees and other affirmative relief, shall be under the jurisdiction of the Labor
Arbiters. The Labor Arbiters shall give utmost priority to the hearing and resolution of all cases
involving unfair labor practices. They shall resolve such cases within thirty (30) calendar days
from the time they are submitted for decision.

> Paragraph 3 simply states that the civil aspects of all cases involving unfair labor practices shall
be under the jurisdiction of the Labor Arbiters. The Labor Arbiters shall also prioritize hearing and
resolution of all cases that involves unfair labor practice and they shall resolve such cases within 30
calendar days from the time they are submitted for decision.

Recovery of civil liability in the administrative proceedings shall bar recovery under the Civil
Code.

No criminal prosecution under this Title may be instituted without a final judgment finding that
an unfair labor practice was committed, having been first obtained in the preceding paragraph.
During the pendency of such administrative proceeding, the running of the period of
prescription of the criminal offense herein penalized shall be considered interrupted. Provided,
however, that the final judgment in the administrative proceedings shall not be binding in the
criminal case nor be considered as evidence of guilt but merely as proof of compliance of the
requirements therein set forth.

> In case the aggrieved party would want to criminally prosecute the management or vice versa,
there must be first a final judgment finding unfair labor practice.
> Prescriptive Period for Filing Criminal and Civil Cases for ULP
– Prescriptive period of filing ULP cases, whether criminal or civil, is one year from the accrual
of the ULP Act.
– Prescriptive period for the criminal case is suspended once the administrative case has been
filed and would only continue running once the administrative case has attained finality.
HOWEVER: Final judgment in the administrative proceedings shall not be binding in the criminal
case nor shall be considered as an evidence of guilt but merely as a proof of compliance of the
requirements prescribed by the Code.

> Prerequisite for Filing Criminal Case:

– Final judgment in the administrative proceeding finding that ULP has been committed.

Article 259. [248] Unfair Labor Practices of Employers. It shall be unfair labor practice for a
labor organiztion, its officers, agents or representatives:

(A) To restrain or coerce employees in the exercise of their right to self-organization. However,
a labor organization shall have the right to prescribe its own rules with respect to the
acquisition or retention of membership;

> Also known as Interference

Interrogation
– Persistent interrogation of employees to elicit information as to what had happened at union
meetings and the identity of the active union employees was held as violative of
organizational rights of employees.
– HOWEVER: To question the employee concerning his union activities without coercion, the
employer must communicate to the employee the purpose of the questioning, assure him that
no reprisal would take place, and obtain his participation on a voluntary basis. Questioning
must also occur in a context free from employer hostility to union organization and must not
itself be coercive in nature.
– GR: Violative of Organizational Rights of Employees
– EX: Communicate the purpose of questioning (no reprisal)

ULP even before union is registered

– RULE: Employer who interfered with the right to self-organization before the union is
registered can be held guilty of ULP.

Prohibiting Organizing Activities

– A rule prohibiting solicitation of union membership in company property is unlawful if it
applies to non-working time as well as to working time.
 – EX: Majority of the employees live on the premises of the employer and cannot be reached by
any means or procedures practically available to union organizers, the employer may be
required to permit non-employee union organizers to come within its premises, in order to
solicit employees
– EX to the EX: In the absence of showing that the illegal dismissal was dictated by anti-union
motives, the same does not constitute ULP as would be a valid ground for strike.
– REMEDY: Action for reinstatement with backwages and damages.

Espionage and Surveillance

– One form of pressure which some over-eager employers sometimes use is the practice of
spying upon employees.
– This device consists of using one or a small group of employees, or other agents, inspired by
profit opportunism, vengeance or come kindred human frailty to use his or their access to
employees’ quarters and affairs for the purpose of spying upon fellow employees and
reporting back to the employer.
NOTE: When an employer engages in surveillance or takes steps leading his employees to believe it
is going on, a violation results because the employees come under threat of economic coercion or
retaliation for their union activities.

Economic inducements
– Violation results from an employer’s announcement of benefits prior to a representation
election, where it is intended to induce the employees to vote against the union.

Employer’s expression of Opinion; Totality of Conduct Doctrine

– This doctrine holds that the culpability of employer’s remarks was to be evaluated not only on
the basis of their implications, but against the background of and in conjunction with
collateral circumstances.

1. Letter to individual employees

– Act of interference for the employer to send a letter to all employees notifying
them to return to work at a time specified therein, otherwise new employees
would be engaged to perform their jobs.

2. Strike-breaking
– When the respondent company offered reinstatement and attempted to bribe the
strikers with comfortable costs, free coffee and occasional movies, overtime pay
for work performed in excess of eight hours, and arrangements for their families,
so they would abandon the strike and return to work, they were guilty of strike-
breaking and/or union-busting and, consequently, of unfair labor practice.

3. Acts Violative of Right to Organize

1. Offer of a christmas bonus to all loyal employees of a company shortly after the
making of a request by the union to bargain;
 2. Wage increases given for the purpose mollifying employees after the employer
has refused to bargain with the union, or for the purpose of inducing striking
employees to return to work;
3. The employer’s promises of benefits in return for the strikers’ abandonment of
their strike in support of their union; and
4. The employer’s statement, made about 6 weeks after the strike started, to a
group of strikers in a restaurant to the effect that if the strikers returned to work,
they would receive new benefits in the form of: (a) hospitalization, (b) accident
insurance, (c) profit sharing, and (d) a new building to work in.

4. Test of Interference or Coercion

– Whether the employer has engaged in conduct which it may reasonably be said
tends to interfere with the free exercise of employees’ rights (under section 3 of
the Act), and it is not necessary that there be direct evidence that any
employee was in fact intimidated or coerced by statements of threats of the
employer if there is a reasonable interference that anti-union conduct of the
employer does have an adverse effect of self-organization and collective
bargaining.

5. The Totality Conduct Doctrine

– Letters should be interpreted according to the totality of conduct doctrine,
whereby the culpability of an employer’s remarks has to be evaluated not only on
the basis of their implicit implications, but were to be appraised against the
background of and in conjunction with collateral circumstances.

(B) To cause or attempt to cause an employer to discriminate against an employee, including

discrimination against an employee with respect to whom membership in such organization has
been denied or to terminate an employee on any ground other than the usual terms and
conditions under which membership or continuation of membership is made available to other
members;

(C) To violate the duty, or refuse to bargain collectively with the employer, provided it is the
representative of the employees;

> Contracting out services is not Unfair Labor Practice per se. It is only ULP when the following
conditions exists:
1. Service contracted-out are being performed by union members; and
2. Such contracting-out interferes with, restrains, or coerce employees in the exercise of
their right to self-organization.

HOWEVER: when the contracting-out is being done to minimze expenses, then it is a valid exercise
of management prerogative.

(D) To initiate, dominate, assist or otherwise interfere with the formation or administration of
any labor organization, including the giving of financial or other support to it or its organizers or
supporters;

(E) To discriminate in regard to wages, hours of work and other terms and conditions of
employment in order to encourage or discourage membership in any labor organization. Nothing
in this Code or in any other law shall stop the parties from requiring membership in a recognized
collective bargaining agent as a condition for employment, except those employees who are
already members of another union at the time of the signing of the collective bargaining
agreement. Employees of an appropriate bargaining unit who are not members of the
recognized collective bargaining agent may be assessed a reasonable fee equivalent to the
dues and other fees paid by members of the recognized collective bargaining agent, if such
non-union members accept the benefits under the collective bargaining agreement: Provided,
that the individual authorization required under Article 242, paragraph (o) of this Code shall not
apply to the non-members of the recognized collective bargaining agent;

> Test of Discrimination: (a) Whenever benefits or privileges given to one is not given to the other
under similar or identical conditions; and (b) When directed to encourage or discourage union
membership.

> Three Components

1. Prohibits discrimination in terms and conditions of employment in order to encourage
or discourage membership in the union;
2. Gives validity to union security agreements;
3. Allows an agency shop arrangement whereby agency fees may be collected from non-
union members.

> Security Arrangements are stipulations in the CBA requiring membership in the contracting union
as a condition for employment or retention of employment in the company.

> Principles of Union Security Arrangements:

1. Protection - shield union members from whimsical and abusive exercise of managment
prerogatives.
2. Benefits - Additional membership will insure additional source of income to the union in
the form of union dues and special assessment.
3. Self-Preservation - Strengthens the union through selective acceptance of new
members on the basis of commitment and loyalty.
> Different kinds of Union Security Arrangements:
1. Closed-shop Agreement
 – Employer undertakes not to employ any individual who is not a member of the
contracting union and the said individual once employer must, for the duration of
the agreement, remain a member of the union in good standing as a condition for
continued employment.
2. Union-shop Agreement
– Stipulation whereby any person can be employed by the employer but once
employed such employee must, within a specific period, become a member of
the contracting union and remain as such in good standing for continued
employment for the duration of the CBA.
3. Maintenance of Membership Clause
– Agreement does not require non-members to join the contracting union but
provides that those who are members thereof at the time of the execution of the
CBA and those may thereafter on their own volition become members must for
the duration of the agreement maintain their membership in good standing as a
condition for continued employment in the company for the duration of the CBA.
4. Preferential shop Agreement
– Employer agrees to give preference to the members of the bargaining union in
hiring or filing vacancies and retention in case of lay-off. But the employer has
the right to hire in open market if union members are not available. Usually,
descendants (children) are also given preference in employment.
5. Agency Shop Agreement
– Agreement whereby employees must either join the union or pay to the union as
exclusive bargaining agent a sum equal to that paid by the members.
– This is directed against free rider employees who benefit from union activities
without contributing to union support to prevent a situation of non-union
members enriching themselves at the expense of union members.

> Requirements for a Valid Union or Close Shop Agreement (so that the employer can terminate the
employee for violation of said agreement):
1. Must be expressed in a clear and unequivocal way so as not to leave room for
interpretation because it is a limitation to the exercise of the right to self-organization.
– Any doubt must be resolved against close-shop
2. Can only have prospective application and cannot be applied retroactively.
3. Can only be exercise by giving the employee his right to due process.
– Employer has the right to satisfy itself that there are sufficient bases for the
request of the union.
– Termination of the employee is not automatic upon the request of the union.
4. Cannot be applied to employees who are already employees of the rival union based on
their religious beliefs.

(F) To dismiss, discharge or otherwise prejudice or discriminate against an employee for having
given or being about to give testimony under this code;
(G) To violate the duty to bargain collectively as prescribed by this Code;

(H) To pay negotiation or attorney’s fees to the union or its officers or agents as part of the
settlement of any issue in collective bargaining or any other dispute; or

(I) To violate a collective bargaining agreement.

NOTE: Violation must be gross and with respect to the economic provision of the CBA.

The provisions of the preceding paragraph notwithstanding, only the officers and agents of
corporations, associations or partnerships who have actually participated in, authorized or
ratified under unfair labor practices shall be held criminally liable.

> Yellow Dog Contract

– A promise exacted from workers as a condition employment that they are not to belong to, or
attempt to foster, a union during their period of employment.
– It is contrary to public for it is tantamount to involuntary servitude.
– It is entered into without consideration for employees waive their right to self-organization.
– Employees are coerced to sign contracts disadvantageous to their family.

No ULP: Illustrative instances of valid exercise of management rights

> Law on ULP is not intended to deprive employers of their fundamental right to prescribe and
enforce such rules as they honestly believe to be necessary to the proper, productive and profitable
operation of their business. Nor are his rights of selection and discharge of employees wrested from
him by the Act.

> Rothernberg stresses that an employer, subject to the provisions of his contract with his
employees, has the same full measure of control over his business as he had prior to the enactment
of the Wagner Act.

> Personnel Movements

– RULE: It is the prerogative of the company to promote, transfer or even demote its employees
to other positions when the interests of the company reasonably demand it.
– UNLESS: There are instance which directly point to interference by the company with the
employees’ right to self-organization, the transfer of private respondent should be
considered as within the bounds allowed by law.

> Mass Resignation

– Acceptance of a voluntary resignation is not ULP.
– Whem employees voluntarily terminated their employment relationship with the company,
they cannot claim that they were dismissed.
> Grant of Profit-sharing Benefits to Non-union Members
– Management has the prerogative to regulate all aspects of employments.

NOTE: Prerogative may be availed of without fear of any liability so long as it is exercised in good
faith for the advancement of the employers’ interest and not for the purpose of defeating or
circumventing the rights of employees under special laws or valid agreement and are not exercise in
a malicious, harsh, oppresive, vindictive or wanton manner or out of malice or spite.

– Flows from the rule that Labor Law does not authorize the substitution of the judgment of the
employer in the conduct of its business.

> Forced Vacation Leave

– Vacation leave without pay, which the employer requires employees to take in view of the
economic crisis, is neither malicious, oppresive or vindictive, ULP is not committed.

> Issuances of Rules or Policy

– Free will of management to conduct its own business affairs to achieve its purpose cannot be
denied.

> Taking action against slowdown (strikes)

– Employees have the right to strike, but they have no right to continue working on their own
terms while rejecting the standards desired by their employer.
– HENCE: An employer does not commit ULP by discharging employees who engaged nad
participated in a slowdown, even if their object is a pay increase which is lawful.

Determination of Validity
– Such suspicion, when coupled with other facts which in themselves, might have been
adequate to support an adverse finding against the employer, may suffice to sustain a finding
that the employer’s action violated the prohibition of the Act.

Article 260. [249] Unfair Labor Practices of Labor Organizations. - It shall be unfair labor
practice for a labor organization and its officers, agents or representatives:

(A) To restrain or coerce employees in the exercise of their right to self-organization. However,
a labor organization shall have the right to prescribe its own rules with respect to the acquisiton
or retention of membership;

(B) To cause or attempt to cause an employer to discriminate against an employee, including

discrimination against an employee with respect to whom membership in such organization has
been denied or to terminate an employee on any ground other than the usual terms and
conditions under which membership or continuation of membership is made available to other
members;

(C) To violate the duty, or refuse to bargain collectively with the employer, provided it is the
representative of the employees;

(D) To cause or attempt to cause an employer to pay or deliver or agree to pay or deliver any
money or other things of value, in the nature of an exaction, for services which are not
performed or not to be performed, including the demand for fee for union negotiations;

(E) To ask for or accept negotiation or attorney’s fees from employers as part of the settlement
of any issue in collective bargaining or any other dispute; or

(F) To violate a collective bargaining agreement

NOTE: Violation must be gross with respect to economic provisions of the CBA.

The provisions of the preceding paragraph notwithstanding, only the officers, members of
governing boards, representatives or agents or members of labor associations or organizations
who have actually participated in, authorized or ratified unfair labor practices shall be held
criminally liable.

> Persons Civilly Liable for ULP

1. Officers and agents of employer
2. Labor organization, officers and agents

> Persons Criminally Liable for ULP

1. Agents and officers who participated or authorized or ratified the act.
2. Agents, representatives, members of the government board, including ordinary
members.

> Featherbedding
– Refers to the practice of the union or its agents in causing or attempting to cause an
employer to pay or deliver or agree to pay or deliver money or other things of value, in the
nature of exaction, for services which are not performed or not to be performed, as when a
union demands that the employer maintain personnel in excess of the latter’s requirements.