TOPIC 16:

Labor Union and Collective Bargaining

By: Jomar G. Santillan

John Aero Vivas

What is Labor Union???

United we stand, divide we fall

The idea of unionism is based on the simple principle that several workers
acting and planning together acquire some kind of power more potent than of
an individual who plans and acts alone.

o Labor Union

Is an organization intended to represent the collective interests of

workers in negotiations with employers over wages, hours, benefits and
working conditions. Labor unions are often industry-specific and tend to
be more common in manufacturing, mining, construction, transportation
and the public sector. (Investopedia)

Three basic elements of the revised Labor Code as the right to self-
organization

1. Forming and joining a labor union

2. Collective bargaining; and

3. Concerted activities including work stoppage

Take note: the union is traditionally called a trade union, enables the
workers to bargain for just labor contracts, among others, in a solid and
collective way.
 Brief history of Unionism in the Philippines

Trade unions emergence constitutes the organized response of workers to

the impact of industrialization.

The first unions arose in Western Europe and the United States at the end of
the 18th and the beginning of the 19th centuries as a reaction to the
development of capitalism. Prior to this date, there was forced labor but not
organized/ unionized labor.

As the factory system developed, great numbers of people left their rural
homes to compete for the relatively few jobs available in urban centers. When
urbanization started in these corners of the world, the surge of immigrants
from far-flung provinces created the labor surplus, and the labor surplus made
the working classes increasingly dependent on their employers.

To offset this dependency and to help workers gain a measure of control over
their economic lives, the earliest unions were formed among skilled artisans.

These groups encountered great opposition from employers and the

government, and were considered illegal associations or conspiracies in the
restraint of trade.

What happened in Europe and the United States happened in the Philippines.
Trade or labor unions came up during the American occupation, with the
coming of US mercantilism in the country. With the American occupation
came the growth of the factory system and with it the birth of Filipino labor
union.

The most popular of the trade unions organized under the American law was
the Union Obrera Democratica Filipina, which was founded and organized by
Isabelo de los Reyes, who was arrested when that union led an unsuccessful
strike in 1903.
Philippine labor movement received its greatest impetus with the inauguration
of the Philippine Commonwealth in 1935. By then the Department of Labor
and the Court of industrial Relations were created, which triggered the
passage of the 8-hour labor law, the Workers Compensation Act and the
Collective Bargaining Law. The balance of power between labor and
management was being built, rather gradually.

Labor unionism has always been a voluntary organization of workers for the
protection of their economic and social interests in the labor market.

According to the revised Labor Code of the Philippines, you have the right to
join a union on the very first day of your employment

Labor unionism all over the world has become a most efficient and pragmatic
instrument to defend the rights of workers everywhere. In recent history, a
labor union called Solidarity mightily drove the entire Communist machinery
out of Poland! However the rise to power of labor unions is not without its
danger, such that workers are not resistant, against the temptations of
abusing that power, ironically, in a capitalist and exploitative fashion.

REGISTRATION OF A LABOR UNION

A labor union needs to acquire a legal personality and be entitled to

the rights and privileges granted by law to a lawful workers' organization.
For this reason, after being organized. A union has to comply with the
basic conditions required by law in order to be registered with the Bureau
of Labor Relations Office of the Department of Labor and Employment.
After its completion of basic requirements, registration with DOLE and the
issuance of the certificate of registration, the labor union now becomes a
legitimate labor organization. After a while, a registered labor union is still
an official labor union. even if it is idle and inoperative or the officers are
inactive
 Functions of the Labor Union

In general, labor union exists to make sure that the four basic,
functions, of Human Resources Management (staffing, development,
compensation, and labor relations functions) are implemented for the
welfare of the employees. In particular, a labor union has the following
official functions (Sison, 2003);

To negotiate the collective bargaining agreement; '

To bargain and settle for a fair contract of employment relations

with management;

To handle the complaints and grievances of employees;

To deal squarely with legal cases and problems of the union and
its members;

To conduct training and education for union leaders and members;

To establish and maintain welfare activities and livelihood programs

for members; and To get involved in community endeavors.

Who is Lech Walesa?

Solidarity, Poland's first independent trade union under a Communist regime,

was founded by Lech s Walesa in 1980.

He gained recognition around the world as the leader of millions of Poland's

workers.

In an attempt to crush the union, the government imposed martial law on Dec.
13, 1981. an act that only enhanced Walesa's reputation.

He was awarded the Nobel peace prize in 1983.

Solidarity candidates scored a stunning victory in June 1989 elections and in
August a prominent member became premier -the first instance of a non-
Communist being chosen head of a Communist nation in Eastern Europe.

Who is Lech Walesa?

Solidarity, Poland's first independent trade union under a Communist

regime, was founded by Lech s Walesa in 1980.

He gained recognition around the world as the leader of millions of Poland's

workers.

In an attempt to crush the union, the government imposed martial law on Dec.
13, 1981. an act that only enhanced Walesa's reputation.

He was awarded the Nobel peace prize in 1983.

Solidarity candidates scored a stunning victory in June 1989 elections and in

August a prominent member became premier -the first instance of a non-
Communist being chosen head of a Communist nation in Eastern Europe.

3 Responsibility and Duties of Labor Union

The union has the duty, when seeking for wage increases, to consider
the general economic interest and the financial health of the particular
branch of industry.

Workers must understand that when they make a request for a

progressive income increase as a basic principle of the wage policy,
they must also share in the responsibility for a proportionate rise in
productivity in the company.

Justice postulates that you (the worker) consider yourself bound by a

standard of output (a duty) corresponding to your salary claims (a
right). In simple terms, the increase in wages should go hand in hand
with the increase in productivity.
 Labor and Industrial Law

All of the laws regulating the conditions under which employees work for
employers are called labor and industrial law.

Examples of the types of issues/ provisions regulated by labor and industrial

law are:

Hours of labor
Child labor
minimum wage
Workers' compensation,
Unemployment insurance,
Worker safety and health,
Disability compensation,
The rights of collective bargaining by labor unions. and
The social security system

COLLECTIVE BARGAINING

Involves the highest kind of the art of negotiation.

It is the basic function of the labor union and not the strike weapon.

It is widely recognized as the quintessential mode or method to settle

industrial disputes.

The most acceptable approach to solving labor disagreements.

It is the most reasonable and satisfactory means of settling with

management the just and fair working conditions of the employees.
 Bargaining in good faith is extremely concerned with sensitive agreements
about the:

Just wage

Holidays

Sick leave

Length of notice

Reinstatement of fired employees

Labor Arbitration

What is Arbitration?

General term to mean negotiation or mediation that eventually leads to

settlement.

It is not yet a CBA.

Labor Arbitration

Is concerned largely with disputes between employers and employees

Commercial Arbitration

Deals with disputes among private parties regarding contracts to produce,

buy, sell, lease or distribute goods, or to perform a business service.

Collective Bargaining Process

Collective bargaining is a long, tedious, and painstaking process.

1. When the time for CBA comes, management forms a panel, one of which
stands as the authorized spokesperson.
 2. The union forms its own panel. Observers may be invited to join the
negotiation process.

3. The talipapa model is applicable here.

4. All negotiation meetings are usually done in a comfortable conference

room with unusual supply of coffee and drinks. Proceedings are noted and
jotted down in official minutes by the secretary.

5. Collective Bargaining Process

At times, negotiations can be emotional. While management panel can

base its arguments on facts, the union panel usually establishes its
arguments on emotions.

6. During negotiations, minor conflicts are settled by calling for a recess or short
breaks and cooler heads mediate in the middle of those conflicts.

7. Both management and union can threaten with a deadlock. If the there is a
deadlock, management and union may opt for voluntary arbitration. The
disagreement is submitted to a third party usually a private person whose
decision is not final.

8. While a CBA process is ongoing, both parties may do off-the-table or side

negotiations.

9. Management and union may sidestep voluntary arbitration and proceed

straight away to compulsory arbitration, which involves the government through
the National Conciliation and Mediation Board (NCMB).

10. When the whole package of CBA has been negotiated and approved by both
parties, the drafting of the document begins.

11. CBA, usually good for three to five years, is certified by the Bureau of Labor
Relations.
 Bernardo V. Lopez offers four basic requirements to a win-win situation in
labor conflicts, namely:

1. Sincerity

2. Transparency

3. Compromisability

4. Continuous dialogue

For the sake of industrial peace the revised Labor Code provision
obligates both management and labor to do the following:

To meet and convene promptly and expeditiously;

To negotiate without taking undue advantage of the other; and

To negotiate in good faith.

Werhane and Radin (1997) believed that the duty to negotiate in good
faith requires all parties to do two things:

1. To demonstrate an honest intent to consummate a labor agreement, and

2. To be reasonable in their respective bargaining positions.

3. CASE STUDY

This author deemed it useful to include this case study done by Jose C.
Sison. It is a true story that involves Olegario who started working as a bus
conductor in a bus company plying the northern route some 25 years before the
case arose. He was a member of the local union in that company which was
affiliated with a national federation. The union he joined entered into a Collective
Bargaining Agreement (CBA) with the bus company, with the inclusion of a
retirement plan for the employees of the bus company.

CASE STUDY
 Among the features of the retirement plan was the employees
compulsory retirement upon reaching the age of 60 years or upon completing 25
years of service to the company, whichever comes first. Under the CBA, the
company agrees to grant retirement benefits to the regular employees who may
be separated from the company upon reaching the said compulsory retirement
age.

CASE STUDY

The CBA was signed three months before Olegrio reached his 25 th year of
service with the company. At that time, he was only 52 years old. Yet he was
retired as soon as he reached the 25th year of service when the CBA was in
effect for about three months only. The basis of his retirement was the
compulsory retirement age in the CBA. But Olegario did not want to retire yet,
because he felt he was still young, very much kicking and alive. He insisted to be
retired at 60 years of age. So he filed a complaint for illegal dismissal against the
company.

Was Olegario illegally dismissed?

NO, according to Jose C. Sison.

CASE STUDY

According to Art. 289, Labor Code, an employee may be retired upon

reaching the retirement age established in the Collective Bargaining Agreement
(CBA) or other applicable employment contract.

Besides, according to Sison, when Olegario ratified the CBA with the
union, he not only agreed to the CBA but also agreed to conform to and abide by
its provisions. Ergo, it could not be said that he was illegally dismissed when the
CBA provision on compulsory retirement was applied to his case.