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PHILIPPINE

AIRLINES, INC. (PAL), petitioner,


v.
NATIONAL LABOUR RELATIONS COMMISSION, LABOUR ARBITER ISABEL P.
ORTIGUERRA and PHILIPPINE AIRLINES EMPLOYEES ASSOCIATION (PALEA),
respondents.
G.R. No. 85985 August 13, 1993
MELO, J.:
Facts:
PAL completely revised its 1966 Code of Discipline. The Code was circulated
among the employees and was immediately implemented, and some employees
were forthwith subjected to the disciplinary measures embodied therein. The
Philippine Airlines Employees Association (PALEA) filed a complaint before t he
National Labour Relations Commission (NLRC). PALEA contended that PAL, by its
unilateral implementation of the Code, was guilty of unfair labour practice,
specifically Paragraphs E and G of Article 249 and Article 253 of the Labour Code. PA
LEA alleged that copies of the Code had been circulated in limited numbers; that
being penal in nature the Code must conform with the requirements of sufficient
publication, and that the Code was arbitrary, oppressive, and prejudicial to the rights
of the employees. It prayed that implementation of the Code be held in abeyance;
that PAL should discuss the substance of the Code with PALEA; that employees
dismissed under the Code be reinstated and their cases subjected to further hearing;
and that PAL be declared guilty of unfair labour practice and be ordered to pay
damages PAL asserted its prerogative as an employer to prescribe rules and
regulations regarding employees' conduct in carrying out their duties and functions,
and alleging that by implementing the Code, it had not violated the collective
bargaining agreement (CBA) or any provision of the Labour Code. Assailing the
complaint as unsupported by evidence, PAL maintained that Article 253 of the
Labour Code cited by PALEA referred to the requirements for negotiating a CBA
which was inapplicable as indeed the current CBA had been negotiated.
Issue:
Whether or not the formulation of a Code of Discipline among employees is a
shared responsibility of the employer and the employees.
Held:
Yes it is. The approval of Republic Act No. 6715, amending Article 211 of the
Labour Code, that the law explicitly considered it a State policy "to ensure the
participation of workers in decision and policy-making processes affecting the rights,
duties and welfare." However, even in the absence of said clear provision of law, the
exercise of management prerogatives was never considered boundless. Thus, in Cruz
vs. Medina (177 SCRA 565 [1989]) it was held that management's prerogatives must
be without abuse of discretion.

The exercise of managerial prerogatives is not unlimited. It is circumscribed by


limitations found in law, a collective bargaining agreement, or the general principles
of fair play and justice.
PAL posits the view that by signing the 1989-1991 collective bargaining
agreement, on June 27, 1990, PALEA in effect, recognised PAL's "exclusive right to
make and enforce company rules and regulations to carry out the functions of
management without having to discuss the same with PALEA and much less, obtain
the latter's conformity thereto." Such provision in the collective bargaining
agreement may not be interpreted as cession of employees' rights to participate in
the deliberation of matters which may affect their rights and the formulation of
policies relative thereto and one such mater is the formulation of a code of
discipline.
Indeed, industrial peace cannot be achieved if the employees are denied their
just participation in the discussion of matters affecting their rights.
Petitioner's assertion that it needed the implementation of a new Code of
Discipline considering the nature of its business cannot be overemphasised. In fact, it
being a local monopoly in the business demands the most stringent of measures to
attain safe travel for its patrons. Nonetheless, whatever disciplinary measures are
adopted cannot be properly implemented in the absence of full cooperation of the
employees. Such cooperation cannot be attained if the employees are restive on
account, of their being left out in the determination of cardinal and fundamental
matters affecting their employment.






















SAMAHANG MANGGAGAWA SA PERMEX (SMP-PIILU-TUCP), petitioners,


v.
THE SECRETARY OF LABOUR, NATIONAL FEDERATION OF LABOUR, PERMEX
PRODUCER AND EXPORTER CORPORATION, respondents.
GR No. 107792, March 2, 1998
MENDOZA, J.:
Facts:
The employees of Permex Producer and Exporter Corporation voted "No
Union" during the January 15, 1991 certification election (CE).
On March 11, 1991, the SMP, which is composed of some employees of Permex
Producer, was registered with the Department of Labour and Employment (DOLE).
On August 16, 1991, SMP requested Permex Producer to recognise SMP as the sole
and exclusive bargaining representative of the employees of Permex Producer.
On October 19, 1991, Permex Producer recognised SMP, and because of such
recognition, Permex entered into a collective bargaining agreement (CBA) with SMP
on December 1, 1991. The CBA was ratified on December 9 & 10, 1991 by the
majority of the rank and file employees of Permex. On December 13, 1991, such CBA
was certified by the DOLE.
On February 25, 1992, the National Labour Federation (NFL) filed a petition for
CE, but was dismissed. NFL's appeal led to its inclusion in the options for CE. SMP
moved for reconsideration.
Issue:
Whether or not support by the majority of the employees makes a CBA
entered by a union valid and binding.
Held:
No, it does not. It is not enough that a union has the support of the majority of
the employees. It is equally important that everyone in the bargaining unit be given
the opportunity to express himself.
This is especially so because, in this case, the recognition given to the union
came barely ten (10) months after the employees had voted "no union" in the
certification election conducted in the company. As pointed out by respondent
Secretary of Labour in his decision, there can be no determination of a bargaining
representative within a year of the proclamation of the results of the certification
election. Here the results, which showed that 61% of the employees voted for "no
union," were certified only on February 25, 1991 but on December 1, 1991 Permex
Producer already recognised the union and entered into a CBA with it.


PORT WORKERS UNION OF THE PHILIPPINES (PWUP), petitioner,


v.
THE HONORABLE UNDERSECRETARY OF LABOUR AND EMPLOYMENT BIENVENIDO
E. LAGUESMA, ATTY. ANASTACIO L. BACTIN, MED-ARBITER NCR-DOLE, Public
Respondents; INTERNATIONAL CONTAINER TERMINAL SERVICES, INC., (ICTSI) and
ASSOCIATED PORT CHECKERS AND WORKERS UNION (APCWU), Private
Respondents; SANDIGAN NG MANGGAGAWA SA DAUNGAN (SAMADA) and PORT
EMPLOYEES ASSOCIATION AND LABOUR UNION (PEALU), Nominal Private
Respondents, respondents.
G.R. Nos. 94929-30 March 18, 1992
CRUZ, J.:
Facts:
The collective bargaining agreement of the International Container Terminal
Services, Inc. (ICTSI) with private respondents Associate Port Checkers and Workers
Union (APCWU), the incumbent union, was due to expire on April 14, 1990. Other
unions were seeking to represent the labourers in the negotiation of the next CBA
and were already plotting their moves.
On March 14, 1990, when the Sandigan ng Manggagawa sa Daungan
(SAMADA) filed a petition for certification election. The consent signatures of at least
25% of the employees in the bargaining unit were submitted on March 26, 1990, or
eleven days after the petition.
On April 2, 1990, herein petitioner Port Workers Union of the Philippines
(PWUP) filed a petition for intervention. Another petition for certification election
was filed by the Port Employees Association and Labour Union (PEALU), on April 6,
1990. The consent signatures were submitted on May 11, 1990, or thirty-five days
after the filing of the petition.
On April 26, 1990, APCWU filed a motion to dismiss them on the ground that
they did not comply with the requirement set forth in Section 6, Rule V, Book V of
the Implementing Rules, quoted in part as follows:
In a petition involving an organised establishment or enterprise where the majority status of the incumbent
collective bargaining union is questioned through a verified petition by a legitimate labour organisation, the Med-
Arbiter shall immediately order the certification election by secret ballot if the petition is filed during the last sixty (60)
days of the collective bargaining agreement and supported by the written consent of at least twenty-five per cent
(25%) of all the employees in the bargaining unit. Any petition filed before or after the sixty-day freedom period shall
be dismissed outright. The twenty-five per cent (25%) requirement shall be satisfied upon the filing of the petition,
otherwise the petition shall be dismissed. (Emphasis supplied.)

The Med-Arbiter dismissed the consolidated petitions. PWUP appealed to the


Secretary of Labour, arguing that Article 256 of the Labour Code did not require the
written consent to be submitted simultaneously with the petition for certification
election. DOLE Undersecretary Laguesma affirmed the order of the Med-Arbiter and

dismissed PWUP's appeal.


ICTSI and APCWU resumed negotiations for a new collective bargaining
agreement, which was concluded on September 28, 1990. This was ratified by a
majority of the workers in the bargaining unit.
PWUP claims grave abuse of discretion on the part of the public respondent in
the application of Article 256 of the Labour Code. The article provides in part as
follows:
Art. 256. Representation issue in organised establishments. In organised establishments, when a verified
petition questioning the majority status of the incumbent bargaining agent is filed before the Department of Labour
and Employment within the sixty-day period before the expiration of the collective bargaining agreement, the Med-
Arbiter shall automatically order an election by secret ballot when the verified petition is supported by the written
consent of at least twenty-five (25%) per cent of all the employees in the bargaining unit to ascertain the will of the
employees in the appropriate bargaining unit. xxx

The petitioner argues that under this article, the Med-Arbiter should
automatically order election by secret ballot when the petition is supported by at
least 25% of all employees in the bargaining unit. SAMADA and PEALU substantially
complied with the law when they submitted the required consent signatures several
days after filing the petition. The petitioner complains that the dismissal of the
petitions for certification election, including its own petition for intervention, had
the effect of indirectly certifying APCWU as the sole and exclusive bargaining
representative of the ICTSI employees.
Private respondent ICTSI maintains that the dismissal was based on Article 256
of the Labour Code as implemented by Section 6, Rule V, Book V of the
Implementing Rules, quoted above. Moreover, under Section 10, Rule V, Book V of
the Implementing Rules, decisions of the Secretary in certification election cases
shall be final and unappealable.
For its part, APCWU questions PWUP's personality in these proceedings in view
of the lack of consent signatures in its petition, and argues as well that the petitioner
has no authority to represent SAMADA or PEALU, which had not appealed. The
private respondent also invokes Tupas and maintains that the ratification of the new
CBA by the majority of the workers was an affirmation of their membership in the
union that negotiated that agreement.
Issue:
Whether or not there was indeed grave abuse of discretion amounting to lack
or excess of jurisdiction on the part of public respondents when they dismissed the
petitions for certification election because the consent signatures had not been
submitted simultaneously with the petition.
Held:
Yes, there was grave abuse of discretion. Pursuant to the constitutional
provision guaranteeing workers the right to self-organisation and collective
bargaining, "the constant and unwavering policy of the Court" has been "to require a

certification election as the best means of ascertaining which labour organisation


should be the collective bargaining representative."
The certification election is the most democratic and expeditious method by
which the labourers can freely determine the union that shall act as their
representative in their dealings with the establishment where they are working. The
holding of a certification election is a statutory policy that should not be
circumvented.
The administrative rule requiring the simultaneous submission of the 25%
consent signatures upon the filing of petition for certification election should not be
strictly applied to frustrate the determination of the legitimate representative of the
workers. Significantly, the requirement in the rule is not found in Article 256, the law
it seeks to implement. This is all the more reason why the regulation should at best
be given only a directory effect.
It is not denied that the petition to intervene filed by PWUP did not carry the
25% consent signatures, but that the requirement is in fact not applicable to a
petition in intervention.
The certification election is not litigation but a mere investigation of a non-
adversary character where the rules of procedure are not strictly applied. Technical
rules and objections should not hamper the correct ascertainment of the labour
union that has the support of confidence of the majority of the workers and is thus
entitled to represent them in their dealings with management.
Deviation from the contract-bar rule is justified only where the need for
industrial stability is clearly shown to be imperative. Subject to this singular
exception, contracts where the identity of the authorised representative of the
workers is in doubt must be rejected in favour of a more certain indication of the will
of the workers.
The certification election is the best method of determining the will of the
workers on the crucial question of who shall represent them in their negotiations
with the management for a collective bargaining agreement that will best protect
and promote their interests. It is essential that there be no collusion against this
objective between an unscrupulous management and a union covertly supporting it
while professing its loyalty to labour, or at least that the hopes of labour be not
frustrated because of its representation by a union that does not enjoy its approval
and support. It is therefore sound policy that any doubt regarding the real
representation of the workers be resolved in favour of the holding of the
certification election. This is preferable to the suppression of the voice of the
workers through the prissy observance of technical rules that will exalt procedure
over substantial justice.

SUGBUANON RURAL BANK, INC., Petitioner, v. HON. UNDERSECRETARY


BIENVENIDO E. LAGUESMA, DEPARTMENT OF LABOUR AND EMPLOYMENT, MED-
ARBITER ACHILLES MANIT, DEPARTMENT OF LABOUR AND EMPLOYMENT,
REGIONAL OFFICE NO. 7, CEBU CITY, AND SUGBUANON RURAL BANK, INC. -
ASSOCIATION OF PROFESSIONAL, SUPERVISORY, OFFICE, AND TECHNICAL
EMPLOYEES UNION-TRADE UNIONS CONGRESS OF THE PHILIPPINES, Respondents.
G.R. No. 116194 February 2, 2000
325 SCRA 425
QUISUMBING:
Facts:
Petitioner Sugbuanon Rural Bank, Inc., (SRBI, for brevity) is a duly-registered
banking institution with principal office in Cebu City and a branch in Mandaue City.
Private respondent SRBI Association of Professional, Supervisory, Office, and
Technical Employees Union (APSOTEU) is a legitimate labour organisation affiliated
with the Trade Unions Congress of the Philippines (TUCP).
On October 8, 1993, the DOLE Regional Office in Cebu City granted Certificate
of Registration to APSOTEU-TUCP, hereafter referred to as the union.
On October 26, 1993, the union filed a petition for certification election of the
supervisory employees of SRBI. It alleged, among others, that: (1) APSOTEU-TUCP
was a labour organisation duly- registered with the Labour Department; (2) SRBI
employed 5 or more supervisory employees; (3) a majority of these employees
supported the petition: (4) there was no existing collective bargaining agreement
(CBA) between any union and SRBI; and (5) no certification election had been held in
SRBI during the past 12 months prior to the petition.
On November 12, 1993, SRBI filed a motion to dismiss the union's petition. It
sought to prevent the holding of a certification election on two grounds. First, that
the members of APSOTEU- TUCP were in fact managerial or confidential employees.
Second, the Association of Labour Unions-Trade Unions Congress of the Philippines
or ALU-TUCP was representing the union.
The union filed its opposition to the motion to dismiss on December 1, 1993. It
argued that its members were not managerial employees but merely supervisory
employees.
On December 9, 1993, the Med-Arbiter denied petitioner's motion to dismiss.
SRBI appealed the Med-Arbiter's decision to the Secretary of Labour and
Employment. The appeal was denied for lack of merit. The certification election was
ordered.
On June 16, 1994, the Med-Arbiter scheduled the holding of the certification
election for June 29, 1994.

On June 17, 1994, SRBI filed with the Med-Arbiter an urgent motion to
suspend proceedings. The Med-Arbiter denied the same. SRBI then filed a motion for
reconsideration. Two days later, the Med-Arbiter cancelled the certification election
scheduled for June 29, 1994 in order to address the motion for reconsideration.
The Med-Arbiter later denied petitioner's motion for reconsideration.
SRBI appealed the order of denial to the DOLE Secretary.
Petitioner proceeded to file a petition with the DOLE Regional Office seeking
the cancellation of the respondent union's registration. It averred that the APSOTEU-
TUCP members were actually managerial employees who were prohibited by law
from joining or organising unions. DOLE Undersecretary denied SRBI's appeal for lack
of merit. He ruled that APSOTEU-TUCP was a legitimate labour organisation. It was
fully entitled to all the rights and privileges granted by law to a legitimate labour
organisation, including the right to file a petition for certification election. He also
held that until and unless a final order is issued cancelling APSOTEU-TUCP's
registration certificate, it had the legal right to represent its members for collective
bargaining purposes.
SRBI moved for reconsideration of the Undersecretary's decision
Issue:
Whether or not the Med-Arbiter may validly order the holding of a certification
election.
Held:
YES, may validly order the holding of a certification election. For one, the
supervisory employees cannot be considered managerial or confidential employees.
While the nature of the employees work (evaluating borrowers capacity to pay,
approving loans, scheduling terms of repayment of the latter, and endorsing
delinquent accounts to legal counsel for collection) indeed constituted the core of
the banks business, their functions did not fall within the definition of either a
managerial employee (lay down and execute management policies related to labour
relations) or a confidential employee (they did not act in a confidential capacity to
persons who formulate and execute management policies related to labour
relations). Secondly, granting the petition would not be violative of the separation of
union doctrine. The petition for certification election was filed by APSOTEU-TUCP, a
legitimate labour organisation. True, it was assisted to some extent by ALU and the
national federation TUCP. However, APSOTEU-TUCP had separate legal personality
from ALU and TUCP, under the principle that a local union maintains its separate
legal personality despite affiliation with a national federation.


SAN MIGUEL FOODS, INCORPORATED, Petitioner, v. SAN MIGUEL CORPORATION
SUPERVISORS and EXEMPT UNION, Respondent.
G.R. No. 146206 August 1, 2011
PERALTA, J.:
Facts:
In G.R. No. 110399, entitled San Miguel Corporation Supervisors and Exempt
Union v. Laguesma, the Court declared that the employees belonging to the three
different plants of San Miguel Corporation Magnolia Poultry Products Plants in
Cabuyao, San Fernando, and Otis, having community or mutuality of interests,
constitutes a single bargaining unit. They perform work of the same nature, receive
the same wages and compensation, and most importantly, share a common stake in
concerted activities. It was immaterial that the three plants have different locations,
as they did not impede the operations of a single bargaining representative.
Pursuant to the Court's decision in G.R. No. 110399, DOLE-NCR conducted pre-
election conferences. However, there was a discrepancy in the list of eligible voters,
i.e., petitioner submitted a list of 23 employees for the San Fernando plant and 33
for the Cabuyao plant, while respondent listed 60 and 82, respectively.
On the date of the election, September 30, 1998, petitioner filed the Omnibus
Objections and Challenge to Voters, questioning the eligibility to vote by some of its
employees on the grounds that some employees do not belong to the bargaining
unit which respondent seeks to represent or that there is no existence of employer-
employee relationship with petitioner. Specifically, it argued that certain employees
should not be allowed to vote as they are among others: (1) employees assigned to
the live chicken operations, which are not covered by the bargaining unit; (2)
employees who belong to the Barrio Ugong plant; (5) non-SMFI employees; and (3)
employees who are members of other unions.
On October 21, 1998, the Med-Arbiter issued an Order directing respondent to
submit proof showing that the employees in the submitted list are covered by the
original petition for certification election and belong to the bargaining unit it seeks
to represent and, likewise, directing petitioner to substantiate the allegations
contained in its Omnibus Objections and Challenge to Voters.
In compliance thereto, respondent averred that (1) the bargaining unit
contemplated in the original petition is the Poultry Division of San Miguel
Corporation, now known as San Miguel Foods, Inc.; (2) it covered the operations in
Calamba, Laguna, Cavite, and Batangas and its home base is either in Cabuyao,
Laguna or San Fernando, Pampanga; and (3) it submitted individual and separate
declarations of the employees whose votes were challenged in the election.

Based on the results, the Med-Arbiter issued the Order dated April 13, 1999,
stating that since the Yes vote received 97% of the valid votes cast, respondent is
certified to be the exclusive bargaining agent of the supervisors and exempt
employees of petitioner's Magnolia Poultry Products Plants in Cabuyao, San
Fernando, and Otis.
On appeal, the then Acting DOLE Undersecretary, in the Resolution dated July
30, 1999, affirmed the Order dated April 13, 1999, with modification that four
employees be excluded from the bargaining unit which respondent seeks to
represent. She opined that the challenged voters should be excluded from the
bargaining unit, because the two are members of Magnolia Poultry Processing Plants
Monthly Employees Union, while the other two are employees of San Miguel
Corporation, which is a separate and distinct entity from petitioner.
Petitioners Partial Motion for Reconsideration dated August 14, 1999 was
denied by the then Acting DOLE Undersecretary in the Order dated August 27, 1999.
Issue:
Whether or not the employees of which are working in different locations have
mutuality of interest.
Held:
Yes they have. In G.R. No. 110399, the Court explained that the employees of
San Miguel Corporation Magnolia Poultry Products Plants of Cabuyao, San Fernando,
and Otis constitute a single bargaining unit, which is not contrary to the one-
company, one-union policy. An appropriate bargaining unit is defined as a group of
employees of a given employer, comprised of all or less than all of the entire body of
employees, which the collective interest of all the employees, consistent with equity
to the employer, indicate to be best suited to serve the reciprocal rights and duties
of the parties under the collective bargaining provisions of the law.
The test of grouping is community or mutuality of interest. This is so because
the basic test of an asserted bargaining units acceptability is whether or not it is
fundamentally the combination which will best assure to all employees the exercise
of their collective bargaining rights. Certainly, there is a mutuality of interest among
the employees of the Sawmill Division and the Logging Division. Their functions
mesh with one another. One group needs the other in the same way that the
company needs them both. There may be differences as to the nature of their
individual assignments, but the distinctions are not enough to warrant the formation
of a separate bargaining unit.
Thus, in the present case, the Court affirms the finding of the CA that there
should be only one bargaining unit for the employees in Cabuyao, San Fernando, and
Otis of Magnolia Poultry Products Plant involved in dressed chicken processing and
Magnolia Poultry Farms engaged in live chicken operations. Certain factors, such
as specific line of work, working conditions, location of work, mode of
compensation, and other relevant conditions do not affect or impede their

commonality of interest. Although they seem separate and distinct from each other,
the specific tasks of each division are actually interrelated and there exists mutuality
of interests which warrants the formation of a single bargaining unit.

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