ARTICLE 264 (formerly Art.

253): DUTY TO BARGAIN COLLECTIVELY

WHEN THERE EXISTS A BARGAINING AGREEMENT
Art. 253. Duty to bargain collectively when there exists a collective
bargaining agreement. When there is a collective bargaining agreement, the duty
to bargain collectively shall also mean that neither party shall terminate nor modify
such agreement during its lifetime. However, either party can serve a written notice
to terminate or modify the agreement at least sixty (60) days prior to its expiration
date. It shall be the duty of both parties to keep the status quo and to continue in
full force and effect the terms and conditions of the existing agreement during the
60-day period and/or until a new agreement is reached by the parties.
Notes:
General Rule: When there is an existing Collective Bargaining Agreement, the
parties thereto are bound to observe the terms and conditions therein set forth until
expiration. It also mean that neither party shall terminate nor modify such
agreement during its lifetime. 1 Therefore, it is the duty of both parties to:
1. Keep the status quo and

2. To continue in the full force and effect the terms and conditions of the
existing CBA.
Exception: During the 60-day period prior to its expiration, upon service of a
written notice of a partys intention to terminate or modify the same, a party may
choose to terminate or modify the agreement. Also known as the freedom period.
Freedom Period- the last sixty (60) days of the 5-year lifetime of a CBA
immediately prior to its expiration is called the freedom period. It is so called
because it is the only time when the law allows the parties to serve notice to
terminate, alter or modify the existing agreement. It is also the time when the
majority status of the bargaining union or agent may be challenged by another
union by filing appropriate petition for certification election. 2
What may be done during the 60-day freedom period.
1. A labor union may disaffiliate from the mother union to form a local or
independent union only during the 60-day freedom period immediately
preceding the expiration of the CBA.
2. Either party can serve a written notice to terminate or modify the agreement
at least sixty (60) days prior to its expiration period.
3. A petition for certification election may be filed.
AUTOMATIC RENEWAL CLAUSE
1
Chan, J. G. The Labor Code of the Philippines Annotated Vol. II, Labor Relations and Termination of
Employment. 2005
2
Ibid.
Notes:
Automatic Renewal Clause it means that the Collective Bargaining Agreement
shall remain effective and enforceable even after the expiration of the period fixed
by the parties as long as no new agreement is reached by the parties.
Automatic renewal clause deemed incorporated in all CBAs.
Unless provided by the parties, the new CBA entered into after the expiration of the
previous agreement does not have any retroactive effect to the day following the
expiry date. Article 253 and 253-A mandate the parties to keep the status quo and
to continue in full force and effect the terms and conditions of the existing
agreement during the 60-day period prior to the expiration of the old CBA and/or
until a new agreement is reached by the parties. Consequently, there being no
agreement reached, the automatic renewal clause provided for by the law which is
deemed incorporated in all CBAs, provides the reason why the new CBA can only be
given a prospective effect3.
ARTICLE 265 (formerly Art. 253-A): TERMS OF A COLLECTIVE
BARGAINING AGREEMENT
Art. 265-A. Terms of a collective bargaining agreement . Any Collective
Bargaining Agreement that the parties may enter into shall, insofar as the
representation aspect is concerned, be for a term of five (5) years. No petition
questioning the majority status of the incumbent bargaining agent shall be
entertained and no certification election shall be conducted by the Department of
Labor and Employment outside of the sixty-day period immediately before the date
of expiry of such five-year term of the Collective Bargaining Agreement. All other
provisions of the Collective Bargaining Agreement shall be renegotiated not later
than three (3) years after its execution. Any agreement on such other provisions of
the Collective Bargaining Agreement entered into within six (6) months from the
date of expiry of the term of such other provisions as fixed in such Collective
Bargaining Agreement, shall retroact to the day immediately following such date. If
any such agreement is entered into beyond six months, the parties shall agree on
the duration of retroactivity thereof. In case of a deadlock in the renegotiation of the
Collective Bargaining Agreement, the parties may exercise their rights under this
Code. (As amended by Section 21, Republic Act No. 6715, March 21, 1989)
DURATION OF CBA
1. With respect to the Representation aspect is concerned, the CBA has a
term of five (5) years.
A petition for certification election, which resolves the representation aspect,
may be entertained and a certification election may be conducted within the
60-day period immediately prior to the expiration of such 5-year term of the
CBA.

3
Chan. 369.
 Representation aspect, defined.
The phrase representation aspect in Art. 253-A of the Labor Code
refers to the identity and majority status of the union that negotiated the CBA
as the exclusive bargaining representative of the appropriate bargaining unit.
The longer five-year term is intended to promote stability in the
administration of the CBA and to minimize, nay, eliminate, constant
deleterious rivalries and disputes among labor unions in connection with the
issue of rightful representation.4

2. With respect to other provisions, the same may last for maximum period of
three (3) years after the execution of the CBA. Hence, may be renegotiated
not later than three years.
The phrase all other provisions, defined.
The phrase all other provisions mentioned in Art. 253-A of the Labor
Code simply refers to the rest of CBA, economic as well as non-economic
provisions, except representation. (San Miguel Corporation Employees Union-
PTGWO vs Confesor, G.R. No. 111262, Sept. 19,1996, 262 SCRA 81,88 ).

The phrase not later than three years (or not later than the third
year according to Section 2, Rule IX Book V of the Rules to Implement the
Labor Code), means that the economic and non-economic provisions other
than the representation aspect should lapse not later than three (3) years and
may be renegotiated before the end of the third year.5
Economic provisions may include:
1. Wages
2. Family planning
3. Effectivity of the agreement
4. Other terms and conditions of employment
Non-Economic provisions may include:
1. Coverage of the bargaining unit
2. Union Security Clauses
3. Management prerogatives rights or responsibilities of employees
4. Grievance machinery and voluntary arbitration and
5. No strike no lock-out provision
4
Ibid. 370
5
Ibid.
 Renegotiated CBA, where filed.
The re-negotiated CBA shall be ratified and registered with the same
Regional Office where the preceding agreement was registered. The same
requirements and procedure in the registration of CBAs prescribed in the
Implementing Rules shall be applied. ( Section 8, Rule XVII, Book V, Rules to
Implement Labor Code, as amended by Department Order No. 40-03, Series of
2003, [Feb. 17, 2003])6

CBA May Be For Five Years Straight.

Art. 253-A of the Labor Code is silent on whether the parties to a CBA
may validly stipulate a straight five-year term for both representation aspect
and all the other economic and non-economic provisions thereof, without
renegotiation after the first three years of the 5-year lifetime thereof. This
silence in the law should be construed to mean that this scheme is legally
allowed, otherwise, if it were not the intention of the framers, they could have
readily expressly provide against it.7

RETROACTIVITY OF CBA
The retroactivity provision of Article 253-A of the Labor Code applies only in
cases where the CBA is voluntarily concluded by and between the parties, and not
through arbitral awards. (St. Lukes Medical Center, Inc. vs. Torres, G.R. No. 99395, June
29, 1993, 223 SCRA 779).

This rule applies only if there is an existing agreement. If there is no existing

agreement, there is no retroactive effect because the date agreed upon shall be the
start of the period of agreement.
Consequently, as a general rule, the question of retroactivity may be mutually
agreed upon by the parties.8
RULE ON RETROACTIVE EFFECTS OF AGREEMENT PROVISIONS
In the absence of any such agreement or in the event of disagreement on
retroactivity and on the period covered by retroactivity, Art. 253-A enunciates the
rule the must be observed in regard thereto, thus:
1. If CBA is the very first for the bargaining unit, the parties are to decide the
CBAs effectivity date.
6
Ibid. 371.
7
Ibid.
8
Ibid.
 2. Those provisions or CBA made within six months after the date of expiry
of the CBA are subject to automatic retroaction to the day immediately
following such expiry.
Ex. CBA expired on December 31. New CBA concluded on March 31.
The effectivity date is January 1.
3. Those that are not made within six (6) months, the parties may agree on
the date of retroaction.
Deadlock
In case of a deadlock in the negotiation or renegotiation of the CBA, the
parties may exercise their rights under the Labor Code ( Article 253-A, Labor Code; Sec.
2 , Rule IX, Book V, Rules to Implement the Labor Code ).

Such rights under the Labor Code include the following:

1. Conciliation and mediation by the NCMB of the Department of Labor and
Employment. This means that deadlock may be taken cognizance of motu
propio by the NCMB or through the filing a notice of strike or notice of
lockout or notice of preventive mediation by any of the parties.
2. Declaration and staging of strike or lockout, as the case may be.
3. Referral of case to compulsory or voluntary arbitration. 9

ARTICLE 266 (formerly Art. 254) INJUNCTION PROHIBITED

Art. 266 (formerly Art. 254). Injunction prohibited. No temporary or
permanent injunction or restraining order in any case involving or growing out of
labor disputes shall be issued by any court or other entity, except as otherwise
provided in Articles 225 and 279 of this Code. (As amended by Batas Pambansa
Bilang 227, June 1, 1982)

Notes:

General Rule : No temporary injunction or restraining order in any case involving

or growing out of labor dispute shall be issued by any court or other entity.
Exception: Article 266 excepts the situations contemplated in Articles 225 (Powers
of the Commission/NLRC) and 279 (Prohibited Activities) of the Labor Code.

9
Chan.375
 Under the first exception, Article 225 of the Labor Code expressly confers
upon the NLRC the power to enjoin or restrain actual and threatened commission of
any or all prohibited or unlawful acts, or to require the performance of a particular
act in any labor dispute which, of not restrained or performed forthwith, may cause
grave or irreparable damage to any party or render ineffectual any decision in favour
of such party xxxxx
Under the second exception, on the other hand, is when the labor
organization or the employer engages in any of the prohibited activities
enumerated in Article 279. The commission of said prohibited activities in the course
of the strike/lockout may be properly enjoined. ( San Miguel Corporation vs NLRC,
G.R. 119293, June 30, 2003).10
No-Injunction Policy/Reason Behind the Prohibition
An injunction may require or restrain the doing of an act. Article 266 declares
announces the policy that labor disputes are generally not subject to injunction.
The policy, basically, is freedom at the workplace. The law, true to the tenets
of free enterprise system, allows management and labor to fashion the contents and
incidents of their relationship. If there is dispute between the parties, the
responsibility to solve it devolves upon them primarily, not upon the government.
Government intervention is the exception rather than the rule.
In short, labor injunction is not favoured. It contradicts the constitutional
preference for voluntary modes of dispute settlement.11
It is more appropriate in the promotion of the primacy of free collective
bargaining and negotiation, including voluntary arbitration, mediation and
conciliation, as modes of settling labor and industrial dispute. ( Ravago vs. Esso
Eastern Marine, Ltd. G.R. No. 158324 March 14, 2005) 12

However, the protective force of law will be applied when prohibited or

unlawful acts are being or about to be committed that will cause grave or irreparable
damage to the complaining party. Article 254 (now 266) itself indicates that where
Article 264 (now 279) regarding prohibited acts, is being violated, the anti-injunction
policy will be brushed aside and a writ of injunction or restraining order will issue in
accordance with Article 218 (now 225).13
Officials Empowered to Issue Injunction.

10
Chan, J. G. The Labor Code of the Philippines Annotated Vol. II. Labor Relations and Termination of
Employment. 2005. page 377
11
Azucena, C.A. The Labor Code with Comments and Cases Vol.II, 2010
12
Chan, J. G. The Labor Code of the Philippines Annotated Vol. II, page 376. Labor Relations and Termination of
Employment. 2005. page 376
13
Azucena, C.A. The Labor Code with Comments and Cases Vol.II, 2010
 1. Office of the President in cases if labor dispute in industries which are
indispensable to national interest (LABOR CODE, Art. 278 formerly 263)
2. Secretary of Labor in case of labor dispute in industries which are
indispensable to national interest, the Secretary may assume jurisdiction over
the dispute or certify the same to the Commission for compulsory arbitration.
Such assumption or certification shall have the effect of automatically
enjoining the intended or impending strike. If one has already taken place,
all striking or locked out employees shall immediately return to work and the
employer shall immediately re-admit employees and resume operation.
(LABOR CODE, Art. 278 paragraph (g) ).
3. National Labor Relation Commission (NLRC) through its division
pursuant to the provisions of paragraph (e) of Article 225 of the Labor Code,
as amended, the Labor Arbiter or Med-Arbiter, are the officials empowered to
issue injunction for purposes of enjoining any or all acts involving or arising
from any case pending before any of said offices or officials which, if not
restrained forthwith, may cause grave or irreparable damage to any of the
parties to the case or seriously affect social or economic stability. 14

Injunction Issued by Regular Court, When Proper

General Rule:
Regular courts are without authority to issue injunction orders in cases involving
or originating from labor disputes even if the complaint was filed by non-striking
employees and the employer was also made a respondent to the action or even if
the complainant is a customer of the strike-bound employer or a sister company
of the strike-bound employer, whose premises were picketed by the strikers. 15
Exception:
A regular court may issue injunction to protect the interest of neutral employers
in common situs picketing, provided the injunction issued did not in any way
curtail the right of petitioner Unions to picket. 16
THIRD PARTIES/INNOCENT BYSTANDERS

14
Chan, J. G. The Labor Code of the Philippines Annotated Vol. II, page 376. Labor Relations and Termination of
Employment. 2005
15
Azucena, C.A. The Labor Code with Comments and Cases Vol.II, 2010

16
Azucena, C.A. The Labor Code with Comments and Cases Vol.II, 2010
In cases of strikes/picketing, third parties or innocent bystanders may secure a
court (regular court) injunction to protect their rights, as shown in the following
cases.
CASE 1: Republic Flour Mill Workers Association vs. Reyes, G.R. No. L-21378,
November 28, 1966
Facts:
Respondent AIA Feed Mills, Inc. filed a petition for injunction before the CFI of
Rizal, alleging among others, that petitioner union, that on June 1, 1963 the
members of the Republic Flour Mills Workers Association and PAFLU declared a
strike against their employer, the Republic Flour Mills, Inc. and picket lines were
formed around the premises of the company preventing peaceful passing of the
other persons not connected with said employer. The respondent is a lessee
occupying a parcel of land owned by the Republic Mills, Inc., it being completely
different corporation from Republic Flour Mills, Inc. with a different set of officers
and employees, and there was no employer-employee relations between the
striking employees.
Also, the respondent allege that due to the picket lines formed by the striking
unions, the employees of the respondent, could not enter and leave its premises,
thereby causing the same to stop its operation which constitute an invasion of
its property rights and therefore causing irreparable and substantial damages.
However, the petitioner, Republic Flour Mills Worker Association and PAFLU, filed
a motion to dismiss, arguing that the injunction prayed for by the respondent is a
labor injunction and because the petition for injunction failed to alleged the
jurisdictional requisites provided for in Sec. 9 of RA 875 fatally defective and
therefore should be dismissed.
The respondent Judge found that AIA Feed Mills, Inc., is a distinct and separate
entity from the Republic Mills, Inc., that it has a distinct personnel of its own,
that it was engaged in different business and that petitioner unions had no
connection whatsoever with the respondent. Based on the findings, the
respondent judge issued a writ of preliminary injunction.
Petitioner filed a petition for certiorari with the SC, seeking to set aside the order
of the respondent Judge. They contend that the respondent AIA Feed Mills, inc,
is a subsidiary corporation of Republic Mills, Inc.; that it is located in the very site
and compound of the latter, and that the operation of the former and of the
latter were intermingled and complementary, including an interchange of
employees; thus the picketing of one necessarily is extended to both.
AIA Feed Mills, Inc. alleged that it is a business entity distinct and separate from
Republic Mills, Inc., and that there is no employer-employee relation between it
and the striking members of the labor unions, and that the union were employing
violence against the employee of the AIA Feed Mills, Inc.
Issue:
Whether or not the respondent Judge of the Court of First Instance of Rizal had
jurisdiction to issue the writ of preliminary injunction in question?
Ruling:
Yes. The Respondent AIA Feed Mills, Inc. is a distinct and separate entity from,
the Republic Flour Mills, Inc., with distinct personality of its own from the latter
corporation, including the business in which it is engaged, and the picketing by
the petitioner unions has no connection whatsoever with the respondent. There
is no labor dispute between the petitioners and respondent and neither is there
an employer-employee relation between them.
The court declared that the writ of preliminary injunction issued by the
respondent Judge is not a labor injunction that is provided in Section 9, of
Republic Act 875. The court may issue an injunction, whether temporary or
permanent only in cases involving or growing out of a labor dispute. The
preliminary injunction issued by the respondent Judge was, therefore, one that
was within its jurisdiction to issue pursuant to the provision of Rule 60 of the
Rules of Court (and not under Sec. 9 of RA 875).

CASE 2: Philippine Association of Free Labor Unions (PAFLU) vs. Judge Cloribel
et. al, G.R. No. L-25878, March 28, 1969
Facts:
The petitioner, the Philippine Association of Free Labor Unions, otherwise known
as PAFLU, and its members picketed against Metropolitan Bank and Trust
Company, METBANK for short, located at the at the ground floor of the
Wellington Building which is tenanted by different persons and business firms.
The owner, Wellington Investment and Manufacturing Corporation, referred to as
Wellington, complained and alleged that the picketers were annoyingly blocking
the common passageway of the building which is the only ingress and egress
being used by the occupants of the second to sixth floors as well as by their
respective employees, clients and customers. Also, they further alleged that
picketing of the passageway in question placed Wellington in an embarrassing
position as the same occupants, and those mostly affected business firms
demanded protection of their peaceful enjoyment of and free access to and from,
the premises respectively leased by them. Thus, Wellington prayed for issuance
of a writ of preliminary injunction against PAFLU, since they were not employees
of Wellington and neither any of its tenants occupying the second to sixth floors
of the building, and they give undue interference not only with its enjoyment of
its property and business of leasing and administering the same but also with the
businesses of said neutral tenants.
Then Vice Executive Judge Cloribel of the First Instance of Manila granted the
prayer of Wellington and issued orders ex parte against PAFLU to cease and
desist among other acts, from demonstrating or picketing in front or along the
common passageway of the Wellington Building.
Immediately after, PAFLU filed petition to Supreme Court alleging that
respondent Judge Cloribel acted without jurisdiction and with grave abuse of
discretion in issuing the foregoing order, in violation of the strict jurisdictional
requirements of Sec. 9 on labor injunctions of RA 875, also known as Industrial
Peace Act.
Issue:
Whether or not the respondent Judge of the Court of First Instance of Manila had
jurisdiction to issue the injunctions in question?
Ruling:
Yes. It is an admitted fact that the strike and the picket are directed against
METBANK, an entirely different and separate entity without connection
whatsoever with Wellington and others other than incidental fact that they are
the banks landlord and co-lessee in the Wellington building, respectively. Their
relationship is so remote that we fail to discern any indicium of said
complainants interest in the labor dispute between the union and METBANK as
to make the case fall within the purview of Sec.2 of RA 875 which provides that a
labor dispute exists.
The right to picket as a means of communicating the facts of labor disputes is a
phase of the freedom of speech guaranteed by the constitution. If peacefully
carried out, it cannot be curtailed even in the absence of employer-employee
relationship. The right, however, is not an absolute one. While peaceful
picketing is entitled to protection as an exercise of free speech, we believe that
courts are not without power to confine or localize the sphere of communication
or demonstration to the parties to the labor dispute , including those with related
interest, and to insulate establishments or persons with no industrial connection
or having interest totally foreign to the context of the dispute. Thus the right
may be regulated at the instance of third parties or innocent bystanders if it
appears that the inevitable result of its exercise is to create an impression that a
labor dispute with which they have no connection or interest exists between
them and the picketing union or constitute an invasion of their rights.
Wellington and others are mere innocent bystanders. They are entitled to seek
protection of their rights from the courts and the same may, accordingly, legally
extend the same.