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1. HIJO RESOURCES CORPORATION (HRC) vs.

MEJARES, ET AL rep, by NAMABDJERA-HRC (complainants) considering their termination, it would be futile for Resps. to appeal Med-Arbit’s order in cert. election case to DOLE
Sec, instead they pursued illeg. dismissal case filed in NLRC.
1. HRC- formerly HPI- owner of agricultural lands in Davao del Norte, planted w/ bananas; HPI was renamed as HRC;
Resps- claimed that they’re employed by HPI as farm workers & were absorbed by HRC, but they were working -purpose of pet. for cert. election is to determine w/c organization will represent employees in their CBA w/
under contractor-growers: (Bit Farm) (Djevon Farm) (Raquilla Farm), they asserted that these contractors received employer; Resp’s union, w/o its member-employees, was thus stripped of its personality to challenge Med-Arbit’s
compensation from HRC and under control of HRC. decision in certif. election case. Thus, resps. were left w/ no option but to pursue their illegal dismissal case filed
before LA.
2. Resps. formed union NAMABDJERA-HRC (Union) registered w/ DOLE; Union filed Pet. for Certification election
(PCE) before DOLE; 3 contractors filed w/ DOLE notice of cessation of business, Resps. were terminated from -To dismiss illeg. dismissal case filed before LA on basis of pronouncement of Med-Arbit. in certif. election case that
employment on ground of cessation of business there’s no EE Rel. w/c Union could not even appeal to DOLE Sec. because of dismissal of its members, would be
tantamount to denying due process to resps. in illegal dismissal case
3. Resps, rep. by Union, filed case for unfair labor practices, illegal dismissal in NLRC

4. DOLE Med-Arbiter dismissed Union’s PCE since no employer-employee relationship between Resps. and HRC.
Resps. NOT appeal Med-Arbiter’s order filed illegal dismissal case in LA

5. HRC filed MTD: Lack of jurisdiction under res judicata; Med-Arbiter’s finding that Resps. NOT employees of HRC,
become final and executory

6. LA RULING infav. of Resps; res judicata NOT apply; decision of Med-Arbit. in cert. election case NOT foreclose
dispute between parties as to existence/non-existence of employer-employee relationship between them; finding
of Med-Arbit. that no employment relationship exists between HRC and Resps. NOT bar LA from making his own
independent finding on same issue.

7. NLRC- infav. of HRC-Med-Arbit. Order dismissing Cert. election case on lack of employer-employee relationship
constitutes res judicata under; Med-Arbit. exercises quasi-judicial power and its decisions have finality

8. CA infav. of Resps; certify. proceedings in Med-Arbiter are non-adversarial and merely investigative; LA has
original & exclusive jurisd. over illeg. dismissal cases, thus, decision in Cert. election case NOT foreclose further
dispute as to existence of an employer-employee relationship between HRC and Resps.

ISSUE: W/n CA is correct that LA in illegal dismissal case, is bound by Med-Arbit;s ruling regarding existence/non-
existence of employer-employee relationship in Cert. election case= NO.

SC: 1. Med-Arbit. Has authority to determine existence of EE rel. bet. parties in Pet. for cert. election; BLR has original
& exclusive jurisd. to decide all disputes arising from labor-management relations in all workplaces whether agricult/
non-agricult; has authority to determine existence of EE Rel. between parties

- once there’s determ. as to existence of such relationship, med-arbiter can decide cert. election case; since
authority to determine EE rel. is necessary and indispensable in exercise of jurisd. by med-arbiter, his finding may
only be reviewed & reversed by Sec. of Labor who exercises appellate jurisd.

2. Med-Arbit. dismissed Cert. election case because of lack of EE rel. between HRC & Resps; order dismissing Pet.
was issued after resps. were terminated from employment w/c led to filing of illeg. dismissal case before NLRC;
2. Philippine Association of Free Labor Unions v. Secretary of Labor, G.R. No. L-22228, February 27, 1969 3. Copy of the amended constitution and by-laws of the Association.

PHILIPPINE ASSOCIATION OF LABOR UNIONS (PAFLU) SOCIAL SECURITY SYSTEM EMPLOYEES ASSOCIATION-PAFLU, Holding
AL FAJARDO AND ALL THE OTHER MEMBERS AND OFFICERS OF THE SOCIAL SECURITY AND EMPLOYEES
ASSOCIATION-PAFLU, petitioners, 1. That the joint non-subversive affidavit and the list of officers mentioned in the letter of Mr. Manuel
vs. Villagracia were not the documents referred to in the notice of hearing and made the subject matter of
THE SECRETARY OF LABOR, THE DIRECTOR OF LABOR RELATIONS and THE REGISTRAR OF LABOR the present proceeding; and
ORGANIZATIONS, respondents.
2. That there is no iota of evidence on records to show and/or warrant the dismissal of the present
Cipriano Cid and Associates and Israel Bocobo for petitioners. proceeding.
Office of the Solicitor General Arturo A. Alafriz and Solicitor Camilo D. Quiason for respondents.
on October 23, 1963, the Registrar rendered a decision cancelling the SSSEA's Registration Certificate No. 1-IP169,
CONCEPCION, C.J.: 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
Petitioners pray for writs of certiorari and prohibition to restrain respondents, the Secretary of Labor, the Director papers and data. An opposition thereto having been filed by one Paulino Escueta, a member of the SSSEA, upon the
of Labor Relations and the Registrar of Labor Organizations, from enforcing an order of cancellation of the ground that the latter had never submitted any financial statement to its members, said motion was heard on
registration certificate of the Social Security System Employees Association — hereinafter referred to as the SSSEA November 27, 1963. Subsequently, or on December 4, 1963, the Registrar issued an order declaring that the SSSEA
— which is affiliated to the Philippine Association of Free Labor Unions — hereinafter referred to as PAFLU — as had "failed to submit the following requirements to wit:
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 1. Non-subversive affidavits of Messrs. Teodoro Sison, Alfonso Atienza, Rodolfo Zalameda, Raymundo
determination of this case. In their answer, respondents traversed some allegations of fact and the legal conclusions Sabino and Napoleon Pefianco who were elected along with others on January 30, 1962.
made in the petition. No writ of preliminary injunction pendente lite has been issued.
2. Names, postal addresses and non-subversive affidavits of all the officers who were supposedly elected
It appears that on September 25, 1963, the Registration of Labor Organizations — hereinafter referred to as the on October (1st Sunday), of its constitution and by-laws.
Registrar — issued a notice of hearing, on October 17, 1963, of the matter of cancellation of the registration of the
SSSEA, because of:
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.
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
Pending such resolution, or on December 16, the PAFLU, the SSSEA, Alfredo Fajardo "and all the officers and
covering the periods from September 24, 1960 to September 23, 1961 and September 24, 1961 to
members" of the SSSEA commenced the present action, for the purpose stated at the beginning of this decision,
September 23, 1962, inclusive, within sixty days of the 2 respective latter dates, which are the end of its
upon the ground that Section 23 of Republic Act No. 875 violates their freedom of assembly and association, and is
fiscal year; and
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
2. Failure to submit to this office the names, postal addresses and non-subversive affidavits of the officers have acted without or in excess of jurisdiction and with grave abuse of discretion in promulgating, on November 19,
of that union within sixty days of their election in October (1st Sunday), 1961 and 1963, in conformity with 1963, its decision dated October 22, 1963, beyond the 30-day period provided in Section 23(c) of Republic Act No.
Article IV (1) of its constitution and by-laws. 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
in violation of Section 23 of Republic Act No. 875. Counsel for the SSSEA moved to postpone the hearing to October SSSEA's certificate of registration would cause irreparable injury.
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 The theory to the effect that Section 23 of Republic Act No. 875 unduly curtails the freedom of assembly and
Villagracia, Assistant Secretary of the SSSEA filed with the Office of the Registrar, a letter dated October 21, 1963, association guaranteed in the Bill of Rights is devoid of factual basis. The registration prescribed in paragraph (b) of
enclosing the following: 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
1. Joint non-subversive affidavit of the officers of the SSS Employees' Association-PAFLU; 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,
2. List of newly-elected officers of the Association in its general elections held on April 29, 1963; and 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 The determination of the question whether the requirements of paragraph (b) have been met, or whether or not
agents of the union they purport to represent. Such requirement is a valid exercise of the police power, because the requisite financial report or non-subversive affidavits have been filed within the period above stated, is not
the activities in which labor organizations, associations and union of workers are engaged affect public interest, judicial power. Indeed, all officers of the government, including those in the executive department, are supposed,
which should be protected. 3 Furthermore, the obligation to submit financial statements, as a condition for the non- to act on the basis of facts, as they see the same. This is specially true as regards administrative agencies given by
cancellation of a certificate of registration, is a reasonable regulation for the benefit of the members of the law the power to investigate and render decisions concerning details related to the execution of laws the
organization, considering that the same generally solicits funds or membership, as well as oftentimes collects, on enforcement of which is entrusted thereto. Hence, speaking for this Court, Mr. Justice Reyes (J.B.L.) had occassion
behalf of its members, huge amounts of money due to them or to the organization. 4 to say:

For the same reasons, said Section 23 does not impinge upon the right of organization guaranteed in the Declaration The objections of the appellees to the constitutionality of Republic Act No. 2056, not only as an undue
of Human Rights, or run counter to Articles 2, 4, 7 and Section 2 of Article 8 of the ILO-Convention No. 87, which delegation of judicial power to the Secretary of Public Works but also for being unreasonable and
provide that "workers and employers, ... shall have the right to establish and ... join organizations of their own arbitrary, are not tenable. It will be noted that the Act (R.A. 2056) merely empowers the Secretary to
choosing, without previous authorization"; that "workers and employers organizations shall not be liable to be remove unauthorized obstructions or encroachments upon public streams, constructions that no private
dissolved or suspended by administrative authority"; that "the acquisition of legal personality by workers' and person was anyway entitled to make because the bed of navigable streams is public property, and
employers' organizations, ... shall not be made subject to conditions of such a character as to restrict the application ownership thereof is not acquirable by adverse possession
of the provisions" above mentioned; and that "the guarantees provided for in" said Convention shall not be impaired (Palanca vs. Commonwealth, 69 Phil., 449).
by the law of the land.
It is true that the exercise of the Secretary's power under the Act necessarily involves the determination
In B.S.P. v. Araos, 5 we held that there is no incompatibility between Republic Act No. 875 and the Universal of some question of fact, such as the existence of the stream and its previous navigable character; but
Declaration of Human Rights. Upon the other hand, the cancellation of the SSSEA's registration certificate would these functions, whether judicial or quasi-judicial, are merely incidental to the exercise of the power
not entail a dissolution of said association or its suspension. The existence of the SSSEA would not be affected by granted by law to clear navigable streams of unauthorized obstructions or encroachments, and authorities
said cancellation, although its juridical personality and its statutory rights and privileges — as distinguished from are clear that they are validly conferable upon executive officials provided the party affected is given
those conferred by the Constitution — would be suspended thereby. opportunity to be heard, as is expressly required by Republic Act No. 2056, section 2.7

To be registered, pursuant to Section 23(b) of Republic Act No. 875, a labor organization, association or union of It should be noted also, that, admittedly, the SSSEA had not filed the non-subversive affidavits of some of its officers
workers must file with the Department of Labor the following documents: — "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
(1) A copy of the constitution and by-laws of the organization together with a list of all officers of the resigned and who were on leave. This averment is, moreover, controverted by respondents herein.
association, their addresses and the address of the principal office of the organization;
Again, the 30-day period invoked by the petitioners is inapplicable to the decision complained of. Said period is
(2) A sworn statement of all the officers of the said organization, association or union to the effect that prescribed in paragraph (c) 8 of Section 23, which refers to the proceedings for the "registration" of labor
they are not members of the Communist Party and that they are not members of any organization which organizations, associations or unions not to the "cancellation" of said registration, which is governed by the
teaches the overthrow of the Government by force or by any illegal or unconstitutional method; and abovequoted paragraph (d) of the same section.

(3) If the applicant organization has been in existence for one or more years, a copy of its last annual Independently of the foregoing, we have repeatedly held that legal provisions prescribing the period within which
financial report. 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,
Moreover, paragraph (d) of said-Section ordains that:
however, is not the import of said paragraph (c). In the language of Black:

The registration and permit of a legitimate labor organization shall be cancelled by the Department of
When a statute specifies the time at or within which an act is to be done by a public officer or body, it is
Labor, if the Department has reason to believe that the labor organization no longer meets one or more
generally held to be directory only as to the time, and not mandatory, unless time is of the essence of the
of the requirements of paragraph (b) above; or fails to file with the Department Labor either its financial
thing to be done, or the language of the statute contains negative words, or shows that the designation
report within the sixty days of the end of its fiscal year or the names of its new officers along with their
of the time was intended as a limitation of power, authority or right. 10
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 Then, again, there is no law requiring the approval, by the Secretary of Labor, of the decision of the Registrar
same right of appeal to the courts as previously provided.6 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 The controversy in this case centers on the requirements before a local or chapter of a federation may file a petition
disapprove, since petitioners, motion for reconsideration of the Registrar's decision of October 23, 1963, is still for certification election and be certified as the sole and exclusive bargaining agent of the petitioner's employees.
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 Petitioner Progressive Development Corporation (PDC) filed this petition for certiorari to set aside the following:
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.
1) Resolution dated September 5, 1990, issued by respondent Med-Arbiter Edgardo dela Cruz, directing the holding
of the certification election among the regular rank-and-file employees of PDC:
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.n
2) Order dated October 12, 1990, issued by the respondent Secretary of Labor and Employment, denying PDC's
appeal; and

3) Order dated November 12, 1990, also issued by the respondent Secretary, denying the petitioner's Motion for
Reconsideration.

On June 19, 1990, respondent Pambansang Kilusan ng Paggawa (KILUSAN) -TUCP (hereinafter referred to as Kilusan)
filed with the Department of Labor and Employment (DOLE) a petition for certification election among the rank-
and-file employees of the petitioner alleging that it is a legitimate labor federation and its local chapter, Progressive
Development Employees Union, was issued charter certificate No. 90-6-1-153. Kilusan claimed that there was no
existing collective bargaining agreement and that no other legitimate labor organization existed in the bargaining
unit.

Petitioner PDC filed its motion to dismiss dated July 11, 1990 contending that the local union failed to comply with
Rule II Section 3, Book V of the Rules Implementing the Labor Code, as amended, which requires the submission of:
(a) the constitution and by-laws; (b) names, addresses and list of officers and/or members; and (c) books of
accounts.

On July 16 , 1990, respondent Kilusan submitted a rejoinder to PDC's motion to dismiss claiming that it had
3. Progressive Development Corp. v. Secretary of the Department of Labor and Employment, G.R. No. 96425, submitted the necessary documentary requirements for registration, such as the constitution and by-laws of the
February 4, 1992 local union, and the list of officers/members with their addresses. Kilusan further averred that no books of accounts
could be submitted as the local union was only recently organized.
PROGRESSIVE DEVELOPMENT CORPORATION, petitioner,
vs. In its "Supplemental Position Paper" dated September 3, 1990, the petitioner insisted that upon verification with
THE HONORABLE SECRETARY, DEPARTMENT OF LABOR AND EMPLOYMENT, MED-ARBITER EDGARDO DELA CRUZ the Bureau of Labor Relations (BLR), it found that the alleged minutes of the organizational meeting was
and PAMBANSANG KILUSAN NG PAGGAWA (KILUSAN)-TUCP, respondents. unauthenticated, the list of members did not bear the corresponding signatures of the purported members, and
the constitution and by-laws did not bear the signature of the members and was not duly subscribed. It argued that
Beltran, Bacungan & Candoy for petitioner. the private respondent therefore failed to substantially comply with the registration requirements provided by the
rules. Additionally, it prayed that Med-Arbiter Edgardo dela Cruz inhibit himself from handling the case for the
reason that he allegedly had prejudged the same.
Jimenez & Associates co-counsel for petitioner.

In his September 5, 1990 resolution, Med Arbiter dela Cruz held that there was substantial compliance with the
requirements for the formation of the chapter. He further stated that mere issuance of the charter certificate by
the federation was sufficient compliance with the rules. Considering that the establishment was unorganized, he
maintained that a certification election should be conducted to resolve the question of representation.
GUTIERREZ, JR., J.:
Treating the motion for reconsideration filed by the PDC as an appeal to the Office of the Secretary, Undersecretary
Laguesma held that the same was merely a "reiteration of the issues already ventilated in the proceedings before
the Med-Arbiter, specifically, the matter involving the formal organization of the chapter." (Rollo, p. 20) PDC's organizations upon issuance of the certificate of registration based on the following
motion for reconsideration from the aforementioned ruling was likewise denied. Hence, this petition. requirements:

In an order dated February 25, 1991, the Court resolved to issue a temporary restraining order enjoining the public (a) Fifty-pesos (P50.00) registration fee;
respondents from carrying out the assailed resolution and orders or from proceeding with the certification election.
(Rollo, pp. 37-39) (b) The names of its officers, their addresses, the principal address of the labor organization,
the minutes of the organizational meeting and the list of the workers who participated in such
It is the petitioner's contention that a labor organization (such as the Kilusan) may not validly invest the status of meetings;
legitimacy upon a local or chapter through the mere expedient of issuing a charter certificate and submitting such
certificate to the BLR (Rollo, p. 85) Petitioner PDC posits that such local or chapter must at the same time comply (c) The names of all its members comprising at least twenty 20% percent of all the employees
with the requirement of submission of duly subscribed constitution and by-laws, list of officers and books of in the bargaining unit where it seek to operate;
accounts. (Rollo, p. 35) PDC points out that the constitution and by-laws and list of officers submitted were not duly
subscribed. Likewise, the petitioner claims that the mere filing of the aforementioned documents is insufficient;
(d) If the applicant has been in existence for one or more years, copies , of its annual financial
that there must be due recognition or acknowledgment accorded to the local or chapter by BLR through a certificate
reports; and
of registration or any communication emanating from it. (Rollo, p. 86)

(e) Four copies of the constitution and by-laws of the applicant union, the minutes of its
The Solicitor General, in behalf of the public respondent, avers that there was a substantial compliance with the
adoption or ratification and the list of the members who participated in it.
requirements for the formation of a chapter. Moreover, he invokes Article 257 of the Labor Code which mandates
the automatic conduct by the Med-Arbiter of a certification election in any establishment where there is no certified
bargaining agreement. And under Article 235 (Action on Application)

The Court has repeatedly stressed that the holding of a certification election is based on a statutory policy that The Bureau shall act on all applications for registration within thirty (30) days from filing.
cannot be circumvented. (Airtime Specialists, Inc. v. Ferrer-Calleja, 180 SCRA 749 [1989]; Belyca Corporation v.
Ferrer-Calleja, 168 SCRA 184 [1988]; George and Peter Lines, Inc. v. Associated Labor Unions, 134 SCRA 82 [1986]). All requisite documents and papers shall be certified under oath by the secretary or the
The workers must be allowed to freely express their choice in a determination where everything is open to their treasurer of the organization, as the case may be, and attested to by its president.
sound judgment and the possibility of fraud and misrepresentation is eliminated.
Moreover, section 4 of Rule II, Book V of the Implementing Rules requires that the application should be signed by
But while Article 257 cited by the Solicitor General directs the automatic conduct of a certification election in an at least twenty percent (20%) of the employees in the appropriate bargaining unit and be accompanied by a sworn
unorganized establishment, it also requires that the petition for certification election must be filed by a legitimate statement of the applicant union that there is no certified bargaining agent or, where there is an existing collective
labor organization. Article 242 enumerates the exclusive rights of a legitimate labor organization among which is bargaining agreement duly submitted to the DOLE, that the application is filed during the last sixty (60) days of the
the right to be certified as the exclusive representative of all the employees in an appropriate collective bargaining agreement.
unit for purposes of collective bargaining.
The respondent Kilusan questions the requirements as too stringent in their application but the purpose of the law
Meanwhile, Article 212(h) defines a legitimate labor organization as "any labor organization duly registered with the in prescribing these requisites must be underscored. Thus, in Philippine Association of Free Labor Unions v. Secretary
DOLE and includes any branch or local thereof." (Emphasis supplied) Rule I, Section 1 (j), Book V of the Implementing of Labor, 27 SCRA 40 (1969), the Court declared:
Rules likewise defines a legitimate labor organization as "any labor organization duly registered with the DOLE
and includes any branch, local or affiliate thereof. (Emphasis supplied) 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
The question that now arises is: when does a branch, local or affiliate of a federation become a legitimate labor registration prescribed in Paragraph (b) of said section is not a limitation to the right of assembly
organization? or association, which may be exercised with or without said registration. The latter is merely a
condition sine qua nonfor the acquisition of legal personality by the labor organizations,
Ordinarily, a labor organization acquires legitimacy only upon registration with the BLR. Under Article 234 associations or unions and the possession of the "rights and privileges granted by law to
(Requirements of Registration): legitimate labor organizations." The Constitution does not guarantee these rights and the
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
Any applicant labor organization, association or group of unions or workers shall acquire legal
abuses, fraud or impostors who pose as organizers, although not truly accredited agents of the
personality and shall be entitled to the rights and privileges granted by law to legitimate labor
union they purport to represent. Such requirement is a valid exercise of the police power,
because the activities in which labor organizations, associations and unions of workers are 3) The submission of the minutes of the adoption or ratification of the constitution and by the laws and the list of
engaged affect public interest, which should be protected. Furthermore, the obligation to the members who participated in it.
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, Undoubtedly, the intent of the law in imposing lesser requirements in the case of the branch or local of a registered
considering that the same generally solicits funds or membership, as well as oftentimes collects, federation or national union is to encourage the affiliation of a local union with the federation or national union in
on behalf of its members, huge amounts of money due to them or to the organization. order to increase the local union's bargaining powers respecting terms and conditions of labor.
(Emphasis supplied)
The petitioner maintains that the documentary requirements prescribed in Section 3(c), namely: the constitution
But when an unregistered union becomes a branch, local or chapter of a federation, some of the aforementioned and by-laws, set of officers and books of accounts, must follow the requirements of law. Petitioner PDC calls for the
requirements for registration are no longer required. The provisions governing union affiliation are found in Rule II, similar application of the requirement for registration in Article 235 that all requisite documents and papers be
Section 3, Book V of the Implementing Rules, the relevant portions of which are cited below: certified under oath by the secretary or the treasurer of the organization and attested to by the president.

Sec. 3. Union affiliation; direct membership with national union. — An affiliate of a labor In the case at bar, the constitution and by-laws and list of officers submitted in the BLR, while attested to by the
federation or national union may be a local or chapter thereof or an independently registered chapter's president, were not certified under oath by the secretary. Does such defect warrant the withholding of
union. the status of legitimacy to the local or chapter?

a) The labor federation or national union concerned shall issue a charter certificate indicating In the case of union registration, the rationale for requiring that the submitted documents and papers be certified
the creation or establishment of a local or chapter, copy of which shall be submitted to the under oath by the secretary or treasurer, as the case may be, and attested to by president is apparent. The
Bureau of Labor Relations within thirty (30) days from issuance of such charter certificate. submission of the required documents (and payment of P50.00 registration fee) becomes the Bureau's basis for
approval of the application for registration. Upon approval, the labor union acquires legal personality and is entitled
b) An independently registered union shall be considered an affiliate of a labor federation or to all the rights and privileges granted by law to a legitimate labor organization. The employer naturally needs
national union after submission to the Bureau of the contract or agreement of affiliation within assurance that the union it is dealing with is a bona fide organization, one which has not submitted false statements
thirty (30) days after its execution. or misrepresentations to the Bureau. The inclusion of the certification and attestation requirements will in a marked
degree allay these apprehensions of management. Not only is the issuance of any false statement and
xxx xxx xxx misrepresentation a ground for cancellation of registration (see Article 239 (a), (c) and (d)); it is also a ground for a
criminal charge of perjury.
e) The local or chapter of a labor federation or national union shall have and maintain a
constitution and by laws, set of officers and books and accounts. For reporting purposes, the The certification and attestation requirements are preventive measures against the commission of fraud. They
procedure governing the reporting of independently registered unions, federations or national likewise afford a measure of protection to unsuspecting employees who may be lured into joining unscrupulous or
unions shall be observed. fly-by-night unions whose sole purpose is to control union funds or to use the union for dubious ends.

Paragraph (a) refers to the local or chapter of a federation which did not undergo the rudiments of registration In the case of the union affiliation with a federation, the documentary requirements are found in Rule II, Section
while paragraph (b) refers to an independently registered union which affiliated with a federation. Implicit in the 3(e), Book V of the Implementing Rules, which we again quote as follows:
foregoing differentiation is the fact that a local or chapter need not be independently registered. By force of law (in
this case, Article 212[h]); such local or chapter becomes a legitimate labor organization upon compliance with the (c) The local chapter of a labor federation or national union shall have and maintain a
aforementioned provisions of Section 3. constitution and by-laws, set of officers and books of accounts. For reporting purposes, the
procedure governing the reporting of independently registered unions, federations or national
Thus, several requirements that are otherwise required for union registration are omitted, to wit: unions shall be observed.(Emphasis supplied)

(1) The requirement that the application for registration must be signed by at least 20% of the employees in the Since the "procedure governing the reporting of independently registered unions" refers to the certification and
appropriate bargaining unit; attestation requirements contained in Article 235, paragraph 2, it follows that the constitution and by-laws, set of
officers and books of accounts submitted by the local and chapter must likewise comply with these requirements.
The same rationale for requiring the submission of duly subscribed documents upon union registration exists in the
2) The submission of officers' addresses, principal address of the labor organization, the minutes of organizational
case of union affiliation. Moreover, there is greater reason to exact compliance with the certification and attestation
meetings and the list of the workers who participated in such meetings;
requirements because, as previously mentioned, several requirements applicable to independent union registration
are no longer required in the case of formation of a local or chapter. The policy of the law in conferring greater
bargaining power upon labor unions must be balanced with the policy of providing preventive measures against the minutes of the organizational meeting. Had the local union filed an application for registration, the petition for
commission of fraud. certification election could not have been immediately filed. The applicant union must firstly comply with the "20%
signature" requirement and all the other requisites enumerated in Article 234. Moreover, since under Article 235
A local or chapter therefore becomes a legitimate labor organization only upon submission of the following to the the BLR shall act on any application for registration within thirty (30) days from its filing, the likelihood is remote
BLR: that, assuming the union complied with all the requirements, the application would be approved on the same day
it was filed.
1) A charter certificate, within 30 days from its issuance by the labor federation or national union, and
We are not saying that the scheme used by the respondents is per se illegal for precisely, the law allows such
strategy. It is not this Court's function to augment the requirements prescribed by law in order to make them wiser
2) The constitution and by-laws, a statement on the set of officers, and the books of accounts all of which are
or to allow greater protection to the workers and even their employer. Our only recourse is, as earlier discussed, to
certified under oath by the secretary or treasurer, as the case may be, of such local or chapter, and attested to by
exact strict compliance with what the law provides as requisites for local or chapter formation.
its president.

It may likewise be argued that it was Kilusan (the mother union) and not the local union which filed the petition for
Absent compliance with these mandatory requirements, the local or chapter does not become a legitimate labor
certification election and, being a legitimate labor organization, Kilusan has the personality to file such petition.
organization.

At this juncture, it is important to clarify the relationship between the mother union and the local union. In the case
In the case at bar, the failure of the secretary of PDEU-Kilusan to certify the required documents under oath is fatal
of Liberty Cotton Mills Workers Union v. Liberty Cotton Mills, Inc., 66 SCRA 512 [1975]), the Court held that the
to its acquisition of a legitimate status.
mother union, acting for and in behalf of its affiliate, had the status of an agent while the local union remained the
basic unit of the association, free to serve the common interest of all its members subject only to the restraints
We observe that, as borne out by the facts in this case, the formation of a local or chapter becomes a handy tool imposed by the constitution and by-laws of the association. Thus, where as in this case the petition for certification
for the circumvention of union registration requirements. Absent the institution of safeguards, it becomes a election was filed by the federation which is merely an agent, the petition is deemed to be filed by the chapter, the
convenient device for a small group of employees to foist a not-so-desirable federation or union on unsuspecting principal, which must be a legitimate labor organization. The chapter cannot merely rely on the legitimate status of
co-workers and pare the need for wholehearted voluntariness which is basic to free unionism. The records show the mother union.
that on June 16, 1990, Kilusan met with several employees of the petitioner. Excerpts of the "Minutes of the
Organizational/General Membership Meeting of Progressive Development Employees Union (PDEU) — Kilusan," are
The Court's conclusion should not be misconstrued as impairing the local union's right to be certified as the
quoted below:
employees' bargaining agent in the petitioner's establishment. We are merely saying that the local union must first
comply with the statutory requirements in order to exercise this right. Big federations and national unions of
The meeting was formally called to order by Bro. Jose V. Parungao, KILUSAN secretary for workers should take the lead in requiring their locals and chapters to faithfully comply with the law and the rules
organization by explaining to the general membership the importance of joining the union. He instead of merely snapping union after union into their folds in a furious bid with rival federations to get the most
explained to the membership why they should join a union, and briefly explained the ideology number of members.
of the Pambansang Kilusan ng Paggawa-TUCP as a democratically based organization and then
read the proposed Constitution and By-Laws, after which said Constitution and By-Laws was
WHEREFORE, the petition is GRANTED. The assailed resolution and orders of respondent Med-Arbiter and Secretary
duly and unanimously ratified after some clarification.
of Labor and Employment, respectively, are hereby SET ASIDE. The temporary restraining order dated February 25,
1991 is made permanent.
Bro. Jose Parungao was also unanimously voted by the group to act as the chairman of the
COMELEC in holding the organizational election of officers of the union.
SO ORDERED.

Bro. Jose Parungao, officially opened the table for nomination of candidates after which the
election of officers followed by secret balloting and the following were the duly elected officers.
(Original Record, p. 25)

The foregoing shows that Kilusan took the initiative and encouraged the formation of a union which automatically
became its chapter. On June 18, 1990, Kilusan issued a charter certificate in favor of PDEU-KILUSAN (Records, page
1). It can be seen that Kilusan was moving very fast.

On June 19, 1990, or just three days after the organizational meeting, Kilusan filed a petition for certification election
(Records, pages 2 and 3) accompanied by a copy each of the charter certificate, constitution and by-laws and
Obrero Pilipino was a legitimate labor organization under Registration Certificate No. NCR-LF-11-04-92 issued by
DOLE on November 11, 1992 and that its chapter affiliate, LAMCOR Chapter, had been assigned Control No. RO400-
9807-CC-030 dated March 23, 1999. A copy of the respondent union’s Certificate of Creation was attached to the
petition. The petition further alleged that the bargaining unit sought to be represented was composed of all the
rank-and-file employees in the petitioner company, more or less, 160 employees. It averred that the said bargaining
unit is unorganized and that there has been no certification election conducted for the past 12 months prior to the
filing of the petition.2

The petitioner company moved to dismiss the petition for certification election. It claimed that the respondent
union was not a legitimate labor organization for failure to show that it had complied with the registration
requirements, such as the submission of the following requirements to the Regional Office or the Bureau of Labor
Relations (BLR):

a) Proof of payment of registration fee;

b) List of officers and their addresses, and the address of the principal place of business of the union;

c) Minutes of the organizational meeting and the list of workers who participated in the said meeting;

d) Names of the members comprising at least twenty percent (20%) of all the employees in the bargaining unit
where the union seeks to operate;

e) Copies of financial reports or books of accounts; and

4. Laguna Autoparts Manufacturing Corp. v. Office of the Secretary of Labor and Employment, G.R. No. 157146,
f) Copies of petitioner’s constitution and by-laws, minutes of its adoption or ratification, and list of members who
April 29, 2005
participated in it.3

The petitioner company further asserted in the said motion that even if the respondent union was issued a
LAGUNA AUTOPARTS MANUFACTURING CORPORATION, Petitioners, certificate of registration, it could not file a petition for certification election since its legal personality was at
vs. question.4
OFFICE OF THE SECRETARY, DEPARTMENT OF LABOR AND EMPLOYMENT (DOLE) and LAGUNA AUTOPARTS
MANUFACTURING CORPORATION OBRERO PILIPINO-LAMCOR CHAPTER, Respondents. On October 24, 2000, Med-Arbiter Anastasio L. Bactin dismissed the petition for certification election for the
respondent union’s lack of legal personality. The Med-Arbiter found that the respondent union had not yet attained
DECISION the status of a legitimate labor organization because it failed to indicate its principal office on the documents it
submitted to the Regional Office. He opined that this was a fatal defect tantamount to failure to submit the complete
requirements, which warranted the dismissal of the petition for certification election.5
CALLEJO, SR., J.:

The respondent union appealed the case to the Secretary of Labor and Employment, Patricia A. Sto. Tomas, who
This is a petition for review of the Decision1 of the Court of Appeals (CA) in CA-G.R. SP No. 67424 dated September ruled as follows:
13, 2002, and the Resolution dated February 5, 2003 denying the motion for reconsideration thereof. The assailed
decision affirmed in toto the decision of the Secretary of Labor and Employment, granting the petition for
certification election filed by respondent Laguna Autoparts Manufacturing Corporation Obrero Pilipino-LAMCOR WHEREFORE, the appeal is GRANTED. The order dated 24 October 2000 of the Med-Arbiter is REVERSED and SET
Chapter. ASIDE. Accordingly, let the entire records of this case be remanded to the regional office of origin for the immediate
conduct of a certification election, subject to the usual pre-election conference, among the rank-and-file employees
of Laguna Auto Parts Manufacturing Corporation (LAMCOR), with the following choices:
On May 3, 1999, the respondent union filed a petition for certification election before the Department of Labor and
Employment (DOLE), Regional Office No. IV, Calamba, Laguna. In its petition, the respondent union alleged that
1. Obrero Pilipino –LAMCOR Chapter; and WITH DUE RESPECT, THE HON. COURT OF APPEALS COMMITTED REVERSIBLE ERRORS OF FACTS AND LAW WHEN IT
AFFIRMED THE DECISION DATED JULY 5, 2001 OF THE HON. SECRETARY PATRICIA STO. TOMAS IN THE CASE IN RE:
2. No Union PETITION FOR CERTIFICATION ELECTION AMONG THE RANK- AND-FILE EMPLOYEES OF LAGUNA AUTO PARTS MFTG.
CORP. CASE NO. RO400-9905-RU-001 WHEN IT RENDERED ITS DECISION DATED SEPTEMBER 13, 2002.13
Pursuant to Section 11.1, Rule XI of the New Implementing Rules, the employer is hereby directed to submit to the
regional office of origin the certified list of current employees in the bargaining unit for the last three months prior The issues are the following: (a) whether or not the respondent union is a legitimate labor organization; (b) whether
to the issuance of this decision. or not a chapter’s legal personality may be collaterally attacked in a petition for certification election; and (c)
whether or not the petitioner, as the employer, has the legal standing to oppose the petition for certification
election.
SO DECIDED.6

The petitioner submits that there is no law prohibiting it from questioning and impugning the status of the
Finding no cogent reason to alter her decision, the Secretary of Labor and Employment denied the motion for
respondent union even in a petition for certification election. It stresses that the right to file a petition for
reconsideration thereof.7
certification election is a mere statutory right and, to enjoy such right, the respondent union must comply with the
requirements provided under the law, particularly the requirement that the applicant must be a legitimate labor
Not convinced, the petitioner filed a petition for certiorari with the CA on the following grounds: organization. In this case, the Med-Arbiter found that the respondent union, which is a local or chapter, had not yet
attained the status of a legitimate labor organization for failure to indicate its principal office on the list of officers
I. PUBLIC RESPONDENT COMMITTED GRAVE ABUSE OF DISCRETION IN FINDING THAT PRIVATE RESPONDENT HAS it submitted to the Regional Office. The petitioner insists that substantial compliance with the requirements is not
COMPLIED WITH ALL REQUIREMENTS FOR REGISTRATION; sufficient; as such, even if such address was indicated in the other documents submitted to the Regional Office, the
requirement would still not be considered fulfilled. The petitioner concludes that the respondent union, therefore,
II. THE PUBLIC RESPONDENT COMMITTED GRAVE ABUSE OF DISCRETION IN FINDING THAT PRIVATE RESPONDENT does not have the right to file a petition for certification election.
IS A LEGITIMATE LABOR UNION DESPITE LACK OF REGISTRATION AS SUCH.8
The petitioner further postulates that in order to be considered legitimate, a labor organization must be issued a
On September 13, 2002, the CA rendered a Decision in favor of the respondent union, thus: certificate of registration. It contends that D.O. No. 9, insofar as it requires that the mere submission of documentary
requirements as sufficient to give legitimate personality to a labor organization, is ultra vires. The petitioner avers
that the said Department Order could not amend Article 234 of the Labor Code which clearly states that the
WHEREFORE, the instant petition is hereby DENIED and the assailed decision of the Secretary of Labor and registration of a union is the operative act that imbues it with legitimate personality.
Employment is AFFIRMED in toto.
The petitioner then argues that since the mere submission of documents does not vest legitimate status on a local
SO ORDERED.9 or chapter, it follows that such status may be questioned collaterally in a petition for certification election. It adds
that the issue of whether or not the respondent union has the legal personality must first be resolved before the
The CA stressed that a local or chapter need not be registered to become a legitimate labor organization. It pointed petition for certification election should be granted.
out that a local or chapter acquires legal personality as a labor organization from the date of filing of the complete
documents enumerated in Section 110 of Rule VI of the Implementing Rules of Book V (as amended by Department Finally, the petitioner maintains that in a number of cases,14 the employer was allowed to question the status of the
Order [D.O.] No. 9). The CA held that the findings of the Labor Secretary was amply supported by the records; such union-applicant in a petition for certification election.15
findings would not be reversed since she is considered to have acquired expertise as her jurisdiction is confined to
specific matters. The CA, citing the case of Pagpalain Haulers, Inc. vs. Trajano,11 also upheld the validity of D.O. No.
9 since the petitioner failed to show that it was contrary to law or the Constitution. For its part, the respondent union avers that the petitioner’s active participation in the representation proceedings
was an act of intervention of the employee’s right to self-organization. It asserts that the CA was correct in finding
that the petitioner did not observe a strictly hands-off policy in the representation proceedings, in violation of
Finally, the CA noted that it was the employer which offered the most tenacious resistance to the holding of a established jurisprudence. It argues that the petitioner’s alleged violation of the requirements of D.O. No. 9, for
certification election among its regular rank-and-file employees. It opined that this must not be so for the choice of failure to indicate its principal address, has already been resolved by the decision of the Secretary of Labor and
a collective bargaining agent was the sole concern of the employees, and the employer should be a mere Employment.16
bystander.12
The petition is unmeritorious.
The petitioner filed a motion for reconsideration of the CA decision, but the same was likewise denied in a Resolution
dated February 5, 2003.
In a petition for review on certiorari as a mode of appeal under Rule 45 of the Rules of Court, a petitioner can raise
only questions of law — the Supreme Court is not the proper venue to consider a factual issue as it is not a trier of
Hence, this petition for review wherein the petitioner relies on the sole ground –
facts.17 Findings of fact of administrative agencies and quasi-judicial bodies, which have acquired expertise because We rule, however, that such legal personality may not be subject to a collateral attack but only through a separate
their jurisdiction is confined to specific matters, are generally accorded not only great respect but even action instituted particularly for the purpose of assailing it. This is categorically prescribed by Section 5, Rule V of
finality.18 This is particularly true where the CA affirms such findings of fact. In this case, the CA affirmed the finding the Implementing Rules of Book V, which states as follows:
of the Secretary of Labor and Employment that the respondent union is a legitimate labor organization.
SEC. 5. Effect of registration.— The labor organization or workers’ association shall be deemed registered and vested
Indeed, a local or chapter need not be independently registered to acquire legal personality. Section 3, Rule VI of with legal personality on the date of issuance of its certificate of registration. Such legal personality cannot
the Implementing Rules of Book V, as amended by D.O. No. 9 clearly states — thereafter be subject to collateral attack but may be questioned only in an independent petition for cancellation in
accordance with these Rules.21
SEC. 3. Acquisition of legal personality by local/chapter.— A local/chapter constituted in accordance with Section 1
of this Rule shall acquire legal personality from the date of filing of the complete documents enumerated therein. Hence, to raise the issue of the respondent union’s legal personality is not proper in this case. The pronouncement
Upon compliance with all documentary requirements, the Regional Office or Bureau shall issue in favor of the of the Labor Relations Division Chief, that the respondent union acquired a legal personality with the submission of
local/chapter a certificate indicating that it is included in the roster of legitimate labor organizations.19 the complete documentary requirement, cannot be challenged in a petition for certification election.

As gleaned from the said provision, the task of determining whether the local or chapter has submitted the complete The discussion of the Secretary of Labor and Employment on this point is also enlightening, thus:
documentary requirements is lodged with the Regional Office or the BLR, as the case may be. The records of the
case show that the respondent union submitted the said documents to Regional Office No. IV and was subsequently … Section 5, Rule V of D.O. 9 is instructive on the matter. It provides that the legal personality of a union cannot be
issued the following certificate: the subject of collateral attack in a petition for certification election, but may be questioned only in an independent
petition for cancellation of union registration. This has been the rule since NUBE v. Minister of Labor, 110 SCRA 274
CERTIFICATE OF CREATION OF LOCAL/ CHAPTER NO. (1981). What applies in this case is the principle that once a union acquires legitimate status as a labor organization,
it continues as such until its certificate of registration is cancelled or revoked in an independent action for
This certifies that as of July 16, 1998 the OBRERO PILIPINO-LAMCOR submitted to this Office Charter Certificate No. cancellation.
07-98 issued by OBRERO PILIPINO with complete supporting documents. From said date, it has acquired legal
personality as a labor organization. It shall have the right to represent its members for all purposes not contrary to Equally important is Section 11, Paragraph II, Rule IX of D.O. 9, which provides for the dismissal of a petition for
law or applicable regulations and to its constitution and by-laws. certification election based on the lack of legal personality of a labor organization only in the following instances:
(1) appellant is not listed by the Regional Office or the BLR in its registry of legitimate labor organizations; or (2)
The legitimate personality of OBRERO PILIPINO-LAMCOR CHAPTER is without prejudice to whatever grounds for appellant’s legal personality has been revoked or cancelled with finality. Since appellant is listed in the registry of
revocation or cancellation as may be prescribed by applicable laws and regulations. legitimate labor organizations, and its legitimacy has not been revoked or cancelled with finality, the granting of its
petition for certification election is proper.22
March 23, 1999
Finally, on the issue of whether the petitioner has the legal standing to oppose the petition for certification election,
we rule in the negative. Our ruling in San Miguel Foods, Inc.-Cebu B-Meg Feed Plant v. Laguesma23 is still sound,
Date
thus:

By:
In any case, this Court notes that it is petitioner, the employer, which has offered the most tenacious resistance to
the holding of a certification election among its monthly-paid rank-and-file employees. This must not be so, for the
(SGD.) choice of a collective bargaining agent is the sole concern of the employees. The only exception to this rule is where
the employer has to file the petition for certification election pursuant to Article 258 of the Labor Code because it
RAYMUNDO G. AGRAVANTE was requested to bargain collectively, which exception finds no application in the case before us. Its role in a
certification election has aptly been described in Trade Unions of the Philippines and Allied Services (TUPAS) v.
Labor Relations Division Chief20 Trajano, as that of a mere bystander. It has no legal standing in a certification election as it cannot oppose the
petition or appeal the Med-Arbiter’s orders related thereto. …24

Hence, the Regional Office, through the Labor Relations Division Chief, has determined that the respondent union
complied with the requirements under the law. It, therefore, declared that the respondent union has acquired legal In conclusion, we find no reversible error in the CA’s decision dismissing the petition for certiorari for the
personality as a labor organization. Absent any pronouncement to the contrary, such determination of the Labor nullification of the decision of the Secretary of Labor and Employment. It should be stressed that certiorari will issue
Relations Division Chief will stand, on the presumption that the duty of determining whether the respondent union only to correct errors of jurisdiction and not to correct errors of judgment or mistakes in the tribunal’s findings and
submitted the complete documentary requirements has been regularly performed.
conclusions.25 The petitioner failed to demonstrate any grave abuse of discretion on the part of the Secretary of ASSOCIATED WORKERS UNION-PTGWO, petitioner,
Labor and Employment in granting the petition for certification election. vs.
THE NATIONAL LABOR RELATIONS COMMISION (EN BANC), METRO PORT SERVICE, INC., MARINA PORT SERVICES,
WHEREFORE, premises considered, the petition is DENIED DUE COURSE. The Decision of the Court of Appeals in CA- INC., ADRIANO S. YUMUL and 10 OTHER INDIVIDUAL RESPONDENTS REPRESENTED BY ATTY. EPIFANIO
G.R. SP No. 67424 and the Resolution dated February 5, 2003 are AFFIRMED. JACOSALEM, respondents.

SO ORDERED. G.R. Nos. 91223-26 JULY 30, 1990

MANILA PORT SERVICES, INC., petitioner,


vs.
HON. ARTHUR G. AMANSEC AND ADRIANO YUMUL, PABLITO REANDELAR, MACARIO DE LUNA, JR., ADAN
MENDOAZA, SMITH CARLOTA, EMERECIANO VERGARA, ROMEO ABACAN, LEONARDO ROMULO, ELINO JOSE, and
CATINDIANO CALAUAG (COLLECTIVELY CALLED AWUM), respondents.

D.T. Dagum, Jr. and P.T. De Quiroz for petitioner in G.R. Nos. 87266-69.

Ramon N. Nalipay, Jr. for petitioner in G.R. Nos. 91223-26.

Cruz, Durian, Agabin, Atienza, Alday & Tuason for respondent MPSI.

Udarbe & Jacosalem for private respondents in G.R. Nos. 91223-26.

FELICIANO, J.:

These cases have been usually difficult for the Court, not because the issues posed are in themselves intellectually
demanding, but because of problems generated by the procedure adopted by the parties in coming before this
Court. The incidents subject of these cases spawned multiple cases and petitions before the National Labor Relations
Commission ("NLRC"). After the NLRC rendered a consolidated decision, the parties, in turn, filed multiple
separate certioraripetitions to the Court — on a staggered and piecemeal basis. This situation resulted in a number
of discrete discussions of issues actually inter-related, since the Court, at any one time, could only see a small part
of the whole picture and decide only on the basis of what it could see. In what follows, we have tried to put the
whole picture together and to render comprehensive and substantial justice to all the parties.

On 26 October 1984, petitioner Associated Workers Union ("AWU")—PTGWO, the then bargaining representative
of the dockworkers at South Harbor, Port Area, Manila, filed a Notice of Strike against respondent Metro Port
Service, Inc. ("Metro"), the then arrastre contractor in the South Harbor, on the issues, among others, of unfilled
vacancies and union busting. This was docketed as NLRC Case No. NCR-NS-10-288-84.

On 3 April 1985, the abovementioned case was certified in an Order by the then Minister of Labor and Employment
to the NLRC for compulsory arbitration; the Order also forbade the holding of strikes or lock-outs. 1 The case was
5. Associated Workers Union-PTGWO v. National Labor Relations Commission, G.R. Nos. 87266-69, 91223-26, July docketed as Certified NLRC Case No. 0403-85. In the latter case, one of the demands raised by AWU was that Metro
30, 1990 terminate the employment of respondents Adriano Yumul and ten (10) others (individual respondents), for having
organized, on 26 October 1984, the Associated Workers Union in Metroport ("AWUM") among the rank-and-file
employees of Metro, ostensibly as a local or chapter of AWU. AWU had earlier expelled individual respondents from
membership in AUW for disloyalty and, pursuant to the closed-shop provision of the existing AWU-Metro collective in relation to NLRC Injuction Case No. 993, ordered their reinstatement with backwages, to be paid solidarily by
bargaining agreement ("CBA"), sought the termination of their employment. AWU and respondent Metro.

Metro initially resisted AWU's request to terminate the employment of individual respondents, contending that the In NLRC Case No. NCR-4-1341-85, the NLRC found the strike staged by AWU not illegal, holding that AWU was of
termination would be premature as individual respondents had not been afforded due process, and that the the belief, although erroneously, that it could validly stage a strike during the pendency of its motion for
termination would be violative of the status quo agreement in NLRC Case No. NCR-NS-10-288-84. 2 Metro, however, reconsideration of the Minister's Order dated 3 April 1985 enjoining a strike or lockout.
eventually relented and suspended individual respondents after AWU—despite the express prohibition in the Order
dated 3 April 1985—staged a strike against it. On 18 April 1985, Metro executed a Compromise Agreement Both AWU and Metro filed separate motions for reconsideration of the consolidated Decision.
("Agreement") with AWU to end the strike, item No. 2 of which stipulated:
Meanwhile, on 21 July 1986, petitioner Marina Port Services, Inc. ("Marina"), by virtue of a Special Permit issued by
At the instance of the union, [Metro] agrees to preventively suspend [individual respondents] the Philippine Ports Authority, started operations as the arrastre operator at the Manila South Harbor vice Metro.
effective immediately. 3 On November 1986, individual respondents in a Motion/Manifestation prayed that Marina be included as party-
respondent.
The Agreement was attested to by then Deputy Labor Minister Carmelo Noriel.
On 27 July 1987, the NLRC in a Resolution denied AWU's and Metro's motions for reconsideration of the
As a result of Metro's implementation of the Agreement, individual respondents on 30 April 1985 filed a complaint consolidated Decision dated 4 September 1986, but (acting on individual respondents' Motion/Manifestation) with
against Metro, docketed as NLRC Case No. NCR-4-1372-85. Metro in that case filed in turn a third-party complaint the modification limiting Metro's liability for backwages to wages accruing up to July 20, 1986 and
against AWU and its officers. ordering Marina to reinstate individual respondents with backwages and allowances starting from 21 July 1986.
Marina complied with the Resolution by reinstating individual respondents through its payroll retroactive to 21 July
Metro in April 1985 also filed a complaint for illegal strike with damages against AWU and its officers, docketed as 1986.
NLRC Case No. NCR-4-1341-85. On 21 June 1985, Labor Arbiter Ceferina Diosana in an Order directed Metro
provisionally to reinstate individual respondents pending resolution of the issues raised therein, with which Order AWU thereafter in G.R. Nos. 87266-69 filed with the Court a Petition for certiorari on 14 March 1989 praying for the
Metro complied. reversal of the decision of the NLRC in NLRC Case No. NCR-NS-10-288-84 and NLRC Injunction Case No. 993 (praying
principally for reversal of the order holding that respondent Metro could not be compelled to fill up vacancies with
On 15 July 1985, AWU filed a petition for injunction against Metro, docketed as NLRC Injunction Case No. 993, AWUs recommendees) and in NLRC Case No. NCR-4-1372-85 (praying chiefly for reversal of the order reinstating
praying for issuance of a temporary restraining order stopping the implementation of the Order of provisional the eleven [11] private respondents to their former positions with backwages payable solidarily by AWU and
reinstatement, and for Metro's compliance with the Agreement providing for the suspension of individual respondent Metro). These cases (G.R. Nos. 87266-69) were assigned to the Third Division of the Court.
respondents. On 1 August 1985, the NLRC in an En Banc Resolution directed Metro to comply with the Agreement,
and Metro complied and re-suspended individual respondents. Individual respondents' petition before the NLRC for Marina, meantime, had gone to the Court on certiorari on 14 June 1988 in G.R. Nos. 81256-59 entitled "Marina Port
preliminary mandatory injunction on 30 August 1985, praying "that pursuant to the Implementing Rules of Batas Services, Inc. v. National Labor Relations Commission, Metro Port Service, Inc, Associated Workers Union ["AWU"-
Pambansa Blg. 130, [Metro] be ordered to pay their salaries and allowances from and after their initial preventive PTGWO], and Associated Workers Union in Metro Port [AWUM]" protesting, on grounds of alleged denial of due
suspension of thirty (30) days and until their actual reinstatement," was not acted upon. process, its inclusion by the NLRC as a party in NLRC Case No. NCR-4-1372-85 and its being required to reinstate
individual respondents with backwages. In dismissing these cases (G.R. Nos. 81256-59) on 3 August 1988, the Court
All the above-mentioned cases, to wit: (a) Certified NLRC Case No. 0403-85 (NCR No. NS-10-288-84); (b) NLRC Case held that:
No. NCR-4-1341-85; (c) NLRC Case No. NCR-4-1372-85; and (d) NLRC Injunction Case No. 993, were ordered
consolidated before the NLRC en banc. . . . [t]he decision to include Marina in the questioned [NLRC Resolution dated 17 July 1987] is
based on Par. "7" of the Special Permit granted to Marina which states that "Labor and
On 4 September 1986, the NLRC rendered a consolidated Decision. In Certified NLRC Case No. 0403-85, the NLRC personnel of previous operator, except those positions of trust and confidence, shall be
ruled that: (a) respondent Metro cannot be compelled to fill up vacancies with AWU's recommendees; (b) absorbed by the grantee." Besides, the petitioner was able to file not only a Motion for
respondent Metro cannot be held liable for union busting, the issue of the medically impaired workers having Reconsideration of the Questioned Resolution but also a Motion to Set Aside
become moot and academic; and (c) the compulsory retirement of AWUs members who have reached the age of Motion/Manifestation and Remarks on the Comment of Metro Port. The lack of due process at
60 years is a valid exercise of management prerogative. the beginning, if any, was cured by the above motions that the petitioner was able to file.4

In NLRC Case No. NCR-4-1372-85, the NLRC, finding that AWU was a national union, and that individual respondents On 13 April 1988, Metro in G.R. No. 82705 (entitled "Metro Port Services, Inc. v. National Labor Relations
have the right to organize themselves into a local chapter thereof, the formation of which was a protected activity Commission, Associated Workers Union-PTGWO, Marina Port Services, Inc., and Adriano Yumul [and 10 others]")
and could not be considered as disloyalty, held the suspension or dismissal of individual respondents as illegal and, went to this court again and assailed the NLRC ruling in NLRC Case No. NCR-4-1372-85 and NLRC Injunction Case
No. 993. Metro claimed that it should not have been held solidary liable with AWU because it had merely suspended in Certified NLRC Case No. 0403-85 (NCR No. NS-10-288-84). The NLRC was correct there in holding that respondent
individual respondents pursuant to the Agreement dated 18 April 1985 it had executed with AWU and, later, had Metro cannot be compelled to fill up vacancies with AWU's recommendees, as the CBA between AWU and
merely obeyed the Resolution of the NLRC dated 1 August 1985 ordering Metro to re-suspend individual respondent Metro granted the latter the right to "fill or not to fill-up vacancies"; that the issue of the medically
respondents. In similarly dismissing Metro's petition, the Court in G.R. No. 82705, held: impaired employees had already been raised in another Notice of Strike filed by AWU against respondent Metro on
16 September 1985, and both parties had agreed to abide by the recommendation and decision of an examining
. . . Considering that the petitioner was a party to the compromise agreement with AWU which physician selected by them; and that the existing CBA grants respondent Metro the right to compulsorily retire any
provided that "at the instance of the union, the company agrees to preventively suspend member of AWU who had reached 60 years of age, which right has been exercised by Metro.
Adriano S. Yumul and eleven associates effective immediately" and accordingly suspended the
private respondents despite the suspension being contrary to law, the petitioner should be 2. The NLRC, however, misappreciated the relevant facts in NLRC Case No. NCR-4-1372-85 and NLRC Injunction Case
made solidarity liable with AWU for the backwages and allowances that the private No. 993. While it is true that AWUM as a local union, being an entity separate and distinct from AWU, is free to
respondents may have been entitled to during their suspension. The petitioner's liability, serve the interest of all its members and enjoys the freedom to disaffiliate, such right to disaffiliate may be exercised,
however, should not extend to the time that respondent NLRC ordered it to re-suspend the and is thus considered a protected labor activity, only when warranted by circumstances. Generally, a labor union
private respondents. 5 (Emphasis supplied) 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.6 Even before the onset of the freedom period (and despite
Judgment was entered in G.R. Nos. 81256-59 and G.R. No. 82705 on 23 September 1988 and 4 July 1989, the closed-shop provision in the CBA between the mother union and management) disaffiliation may still be carried
respectively, and the cases were remanded to the Labor Arbiter of origin for execution. out, but such disaffiliation must be effected by a majority of the members in the bargaining unit. 7 This happens
when there is a substantial shift in allegiance on the part of the majority of the members of the union. In such a
case, however, the CBA continues to bind the members of the new or disaffiliated and independent union up to the
On 18 September 1989, the Labor Arbiter issued a writ of execution against Marina to reinstate individual
CBA's expiration date.8
respondents and to pay them the amount of P154,357.00 representing salary adjustments. Marina moved to quash
the writ of execution questioning the award of P154,357.00, but without success. Marina thereafter appealed to
the NLRC assailing the Labor Arbiter's refusal to quash the writ of execution. The record does not show that individual respondents had disaffiliated during the freedom period. The record does,
however, show that only eleven (11) members of AWU (individual respondents) had decided to disaffiliate from
AWU and form AWUM. Respondent Metro had about 4,000 employees, and around 2,000 of these were members
On 23 November 1989, Marina received an Order from the Executive Labor Arbiter dated 15 November 1989,
of AWU 9 It is evident that individual respondents had failed to muster the necessary majority in order to justify
requiring the release of any garnished deposit from its bank, holding that no seasonable appeal from the 7
their disaffiliation. (In fact, it was only on 5 December 1985 that individual respondents were finally able to register
November 1989 Order denying Marina's motion to quash had been taken. Marina filed a Manifestation dated 23
an independent union called Metroport Workers Union [MWU]. 10 Even then, in the absence of allegation by AWUM
November 1989, arguing that it had filed an appeal with the NLRC within the 10-day reglementary period.
[MWU] of the exact number of its members, the Court presumes that only twenty percent [20%] of the employees
of Metro had joined MWU) 11 Thus, in the referendum held on 7 January 1985 at the PTGWO compound (where
On 6 December 1989, the Executive Labor Arbiter issued a writ of execution requiring Marina: (a) to reinstate representatives of the Ministry of Labor and Employment were present) to determine whether individual
individual respondents and to pay them the amount of P154,357.00 representing salary adjustments; and (b) to respondents should be expelled from AWU, 1,229 members (out of 1,695 members present) voted for expulsion of
implement and honor the legality of the organization and registration of AWUM as the local chapter of AWU. Marina individual respondents. 12
then once more went to the Court in G.R. Nos. 91223-26 and filed a Petition for certiorari to invalidate the writ of
execution, pleading that: (a) execution had been ordered without due regard for its right of appeal from the Labor
The individual respondents here have failed to present proof of their allegation that the 1,695 members of AWU
Arbiter's Order; and (b) execution would result in its being made to pay more than what is called for by the ruling of
were not employees of respondent Metro alone; the Court therefore presumes that those who voted for their
the Court in G.R. No. 82705, where the Court affirmed the NLRC ruling that Marina "should be made solidarily liable
expulsion were bona fide employees of respondent Metro. Moreover, individual respondents failed to allege that
with AWU for the backwages and allowances that the private respondents may have been entitled to during their
their expulsion for disloyalty violated AWU's constitution and by-laws. 13 In sum, the attempted disaffiliation of the
suspension [although liability] should not extend to the time that respondent NLRC ordered it to re-suspend the
eleven (11) private respondents from the petitioner mother union and the effort to organize either a new local of
private respondents." These cases (G.R. Nos. 91223-26) were assigned to the First Division of the Court. On 20
the mother union or an entirely new and separate union, did not, under the circumstances of this case, constitute
December 1989, a temporary restraining order was issued by the First Division of the Court to enjoin the
protected activities of the eleven (11) individual respondents.
implementation of the Executive Labor Arbiter's Order of 6 December 1989.

II
On 16 April 1990, G.R. Nos. 91223-26 were consolidated with G.R. Nos. 87266-69.

In view of the conclusion reached above in G.R. Nos. 87266-69, i.e., that AWU was justified in expelling from its
I
membership the eleven (11) individual respondents, the question now arises: how and to what extent does such
conclusion affect the liability of Metro, and Marina (as successor-employer)? It will be recalled that the Resolutions
1. Deliberating on the instant Petition for Certiorari, the Court in G.R. Nos. 87266-69 considers that petitioner AWU of this Court in G.R. Nos. 81256-59 and 82705 dismissing the Petitions for certiorari of both Metro and Marina
has failed to show grave abuse of discretion or any act without or in excess of jurisdiction on the part of the NLRC assailing the NLRC consolidated Decision of 4 September 1986 insofar as their (Metro's and Marina's) liability for
reinstatement and backwages of the individual respondents thereunder is concerned, became final and judgment Third Period: From 28 July 1987 to 18 September 1989: on 18 September 1989, the Labor
entered therein, sometime ago. Arbiter issued the questioned writ of execution ordering, among other things, Marina to
reinstate formally the individual respondents.
1. So far as concerns AWU's liability under the NLRC consolidated Decision, it should in the first place be pointed
out that the Court did not make any pronouncement either in G.R. Nos. 81256-59 or in G.R. No. 82705 concerning Under the consolidated NLRC Decision, Metro/Marina are liable for the backwages accruing during the First and
AWU's liability. In G.R. No. 82705, the Court merely acted on the issue raised by petitioner Metro: that Metro should Third Periods above indicated. In respect of the Second Period, however, the Court in G.R. No. 82705, as already
not be liable at all for reinstatement and backwages considering that Metro was only pressed into suspending pointed out earlier, held that Metro/Marina should not be held liable for backwages accruing during that period.
individual respondents because of AWUs threat to strike. In dismissing Metro's Petition, the Court in G.R. No. 82705 Strictly speaking, in view of our conclusion above that AWU was justified in expelling individual respondents from
in effect merely held that Metro, whatever the liability of AWU might be in respect of the expulsion of individual its membership, neither AWU nor Metro/Marina would be liable to individual respondents for the backwages
respondents, could not escape liability by throwing all responsibility upon AWU; and that Metro could not validly accruing during this Second Period.
plead that it was under duress when it executed the Agreement with AWU providing for, among other things, the
preventive suspension of individual respondents. 4. In the interest of substantial and expeditious justice, however, we believe that the backwages accruing during the
Second Period should be paid and shared by AWU and by Metro Marina, on a 50-50 basis. We here establish this
The Court is, of course, aware that AWU was a party-respondent in both G.R. Nos. 81256-59 and 82705, and that equitable allocation of ultimate responsibility in order to forestall further litigation between AWU and Metro/Marina
AWU had in fact filed a Comment in both G.R. Nos. 81256-59 and 82705. Nonetheless, the Court did not either in and individual respondents in respect of claims and countering claims for payment or reimbursement or
G.R. Nos. 82156-59 or in G.R. No. 82705 in fact make a determination of the legality of AWU's expulsion of individual contribution and to put a definite end to this prolonged and costly confrontation among the several parties.
respondents from its membership. The Court in G.R. No. 82705 held only that the liability of Metro was solidary in
nature, i.e., solidary with AWU, whatever AWU's liability might be; and it may be well to recall that solidary liability The equitable considerations which impel us to hold AWU liable for one-half (½) of the backwages during the Second
is different from secondary liability. In G.R. Nos. 81256-59, the Court simply held that Marina was properly Period include:
impleaded in the underlying cases and could not be absolved from responsibility for reinstatement and backwages
upon the ground of denial of due process.
(a) the fact that Metro had been reluctant to comply with the demand of AWU to terminate the
services of individual respondents and had wanted to give the latter procedural due process,
2. Thus, so far as concerns the liability of Metro and Marina for reinstatement with backwages of individual but gave in to the demands of AWU;
respondents under the consolidated NLRC Decision, the pre-eminent fact is that the Court's Resolutions in G.R. Nos.
81256-59 and 82705 dismissing their Petitions are already final. The liabilities of Metro and Marina for
(b) that AWU had pressed Metro very hard and indeed went on strike against Metro when
reinstatement and backwages under the consolidated NLRC Decision have become fixed and definite, with the
Metro refused simply to terminate the services of the individual respondents;
modification decreed by the Court in G.R. No. 82705 in so far as backwages were concerned. Thus, the conclusion
we today have reached in G.R. Nos. 87266-69 cannot benefit Metro and Marina and will not dissolve their already
fixed and definite liabilities. (c) that AWU, instead of waiting for final judicial determination of the legality of its expulsion of
individual respondents, chose to importune the NLRC to issue the order requiring the re-
suspension of the individual respondents on 1 August 1985, with which order Metro eventually
3. Turning to the question of the backwages due to the eleven (11) individual respondents, three (3) different time
complied.
periods are relevant here and must be distinguished from one another:

5. Turning to Metro/Marina we note that, apart from the finality of the Court's Resolutions in G.R. Nos. 81256-59
First Period: From 18 April 1985 to 21 June 1985: the Compromise Agreement between Metro
and 82705, there is independent basis for holding Metro/Marina responsible for reinstatement with backwages
and AWU to end the strike, in which Metro agreed to preventively suspend the eleven (11)
accruing throughout the three (3) periods above indicated. The equitable considerations which lead us to hold
individual respondents, was effected on 18 April 1985 and implemented immediately. The Labor
Metro/Marina responsible for one-half (½) of the backwages accruing during the above Second Period relate to the
Arbiter on 21 June 1985 ordered Metro to reinstate provisionally the eleven (11) individual
failure of Metro to accord individual respondents procedural due process by giving them reasonable opportunity to
respondents and Metro complied.
explain their side before suspending or dismissing them. Such dismissal was accordingly in violation of the Labor
Code.14Notwithstanding AWU's closed-shop clause in the CBA, Metro was bound to conduct its own inquiry to
Second Period: From 1 August 1985 up to 27 July 1987: the NLRC, pursuant to the urging of determine the existence of substantial basis for terminating the employment of individual respondents. 15 That
AWU, ordered Metro to re-suspend the individual respondents on 1 August 1985 and Metro AWU, disregarding the Minister of Labor and Employment's express order, had threatened to go on strike, and
again complied with this Order. Approximately two (2) years later, on 27 July 1987, NLRC indeed actually went on strike, if Metro had continued with the services of individual respondents, did not relieve
ordered Metro/Marina to reinstate the individual respondents and Marina complied by Metro from the duty to accord procedural due process to individual respondents. 16
reinstating the individual respondents on the payroll, i.e., paying their salaries although they
were not allowed to work on their jobs.
6. The portion of the Writ of Execution issued by the Executive Labor Arbiter requiring Marina to pay salary
differentials in the total amount of P154,357.00 accruing during the period from 20 July 1986 up to October 1989,
should be modified to conform with the above legal and equitable allocation of liability for the backwages which 6. THE HERITAGE HOTEL MANILA vs. SECRETARY OF LABOR AND EMPLOYMENT, G.R. No. 172132, July 23, 2014
had accrued during the three (3) Periods above mentioned during which the individual respondents were
suspended. The salary differentials, as we understands it, refer to increases in the prevailing wages accruing partly HE HERITAGE HOTEL MANILA, ACTING THROUGH ITS OWNER, GRAND PLAZA HOTEL CORPORATION,Petitioner,
during the Second Period and partly during the Third Period as above indicated. In other words, the salary vs.
differentials accruing from 20 July 1986 up to 27 July 1987 should be borne on a 50-50 basis by AWU on the one SECRETARY OF LABOR AND EMPLOYMENT; MED-ARBITER TOMAS F. FALCONITIN; and NATIONAL UNION OF
hand and Metro/Marina on the other. The salary differentials accruing from 28 July 1987 up to 18 September 1989 WORKERS IN THE HOTEL, RESTAURANT and ALLIED INDUSTRIES-HERITAGE HOTEL MANILA SUPERVISORS CHAPTER
shall be borne exclusively by Marina. (NUWHRAINHHMSC), Respondents.

7. The portion of the Writ of Execution issued by the Executive Labor Arbiter which requires Marina to recognize DECISION
the legality of the organization and registration of AWUM (now MWU) as a local chapter of AWU, is inconsistent
with the conclusions we have set forth in Part I above, and must be deleted. What was in fact eventually established
by individual respondents was a separate, independent union called Metro Port Workers Union (MWU) which was BERSAMIN, J.:
not entitled, during the time periods here relevant, to recognition as the bargaining unit in CBA negotiations.
Although case law has repeatedly held that the employer was but a bystander in respect of the conduct of the
ACCORDINGLY, the Court Resolved: certification election to decide the labor organization to represent the employees in the bargaining unit, and that
the pendency of the cancellation of union registration brought against the labor organization applying for the
certification election should not prevent the conduct of the certification election, this review has to look again at
In G.R. Nos. 87266-69: the seemingly never-ending quest of the petitioner employer to stop the conduct of the certification election on
the ground of the pendency of proceedings to cancel the labor organization's registration it had initiated on the
(a) to DISMISS the Petition for Certiorari in respect of Certified NLRC Case No. 0403-855 (NCR- ground that the membership of the labor organization was a mixture of managerial and supervisory employees with
NS-10-288-84) for lack of merit; and the rank-and-file employees.

(b) to GRANT partially the Petition for Certiorari in respect of NLRC Case No. NCR-4-1372-85 and Under review at the instance ofthe employer is the decision promulgated on December 13, 2005,1 whereby the
NLRC Injunction Case No. 993. The consolidated Decision of the NLRC dated 4 September 1986 Court of Appeals (CA) dismissed its petition for certiorari to assail the resolutions of respondent Secretary of Labor
ordering AWU and Marina to pay solidarily the backwages of individual respondents, as well as and Employment sanctioning the conduct of the certification election initiated by respondent labor organization.2
the NLRC Resolution of 27 July 1987 denying AWUs and Metro's Motions for Reconsideration,
are hereby MODIFIED so as to require AWU and Metro/Marina to pay, on a 50-50 basis, to Antecedents
individual respondents the backwages which accrued during the Second Period, i.e., from 1
August 1985 up to 27 July 1987.
On October 11, 1995, respondent National Union of Workers in Hotel Restaurant and Allied Industries-
HeritageHotel Manila Supervisors Chapter (NUWHRAIN-HHMSC) filed a petition for certification election,3 seeking
In G.R. Nos. 91223-26: to represent all the supervisory employees of Heritage Hotel Manila. The petitioner filed its opposition, but the
opposition was deemed denied on February 14, 1996 when Med-Arbiter Napoleon V. Fernando issued his order for
to GRANT partially the Petition. The Order of the Executive Labor Arbiter dated 6 December the conduct of the certification election.
1989 is hereby MODIFIED so as (a) to require AWU and Metro/Marina on a 50-50 basis to pay
the salary differentials accruing during the period from 20 July 1986 up to 27 July 1987, and The petitioner appealed the order of Med-Arbiter Fernando, but the appeal was also denied. A pre-election
Marina alone to pay the salary differentials accruing from 28 July 1987 up to 31 October 1989, conference was then scheduled. On February 20, 1998, however, the pre-election conference was suspended until
and so as (b) to delete the portion requiring Marina to recognize AWU. (MWU) as the local further notice because of the repeated non-appearance of NUWHRAIN-HHMSC.4
chapter of AWU. The Temporary Restraining Order issued by the Court on 20 December 1989
is hereby LIFTED so as to permit enforcement of the Order of the Executive Labor Arbiter as
herein modified. On January 29, 2000, NUWHRAIN-HHMSC moved for the conduct of the pre-election conference. The petitioner
primarily filed its comment on the list of employees submitted by NUWHRAIN-HHMSC, and simultaneously sought
the exclusion ofsome from the list of employees for occupying either confidential or managerial positions. 5 The
No pronouncement as to costs. petitioner filed a motion to dismiss on April 17, 2000,6 raising the prolonged lack of interest of NUWHRAIN-HHMSC
to pursue its petition for certification election.
SO ORDERED.
On May 12, 2000, the petitioner filed a petition for the cancellation of NUWHRAIN-HHMSC’s registration as a labor
union for failing to submit its annual financial reports and an updated list of members as required by Article 238 and
Article 239 of the Labor Code, docketed as Case No. NCROD-0005-004-IRD entitled The Heritage Hotel Manila, acting
through its owner, Grand Plaza Hotel Corporation v. National Union of Workers in the Hotel, Restaurant and Allied WHEREFORE, the appeal is DENIED. The order of the Med- Arbiter dated 26 January 2001 is hereby AFFIRMED.
Industries-Heritage Hotel Manila Supervisors Chapter (NUWHRAIN-HHSMC).7 It filed another motion on June 1,
2000 to seek either the dismissal or the suspension of the proceedings on the basis of its pending petition for the SO RESOLVED.
cancellation of union registration.8
DOLE Secretary Sto. Tomas observed that the petitioner’s reliance on Toyota Motor and Dunlop Slazenger was
The following day, however, the Department of Labor and Employment (DOLE) issued a notice scheduling the misplaced because both rulings were already overturned by SPI Technologies, Inc. v. Department of Labor and
certification elections on June 23, 2000.9 Employment,19 to the effect that once a union acquired a legitimate status as a labor organization, it continued as
such until its certificate of registration was cancelled or revoked in an independent action for cancellation.
Dissatisfied, the petitioner commenced in the CA on June 14, 2000 a special civil action for certiorari,10 alleging that
the DOLE gravely abused its discretion in not suspending the certification election proceedings. On June 23, 2000, The petitioner moved for reconsideration.
the CA dismissed the petition for certiorarifor nonexhaustion of administrative remedies.11
In denying the motion on October 21, 2002, the DOLE Secretary declared that the mixture or co-mingling of
The certification election proceeded as scheduled, and NUWHRAINHHMSC obtained the majority vote of the employees in a union was not a ground for dismissing a petition for the certification election under Section 11, par.
bargaining unit.12 The petitioner filed a protest (with motion to defer the certification of the election results and the II, Rule XI of Department Order No. 9; that the appropriate remedy was to exclude the ineligible employees from
winner),13 insisting on the illegitimacy of NUWHRAIN-HHMSC. the bargaining unit during the inclusion-exclusion proceedings;20 that the dismissal of the petition for the
certification election based on the legitimacy of the petitioning union would be inappropriate because it would
Ruling of the Med-Arbiter effectively allow a collateral attack against the union’s legal personality; and that a collateral attack against the
personality of the labor organization was prohibited under Section 5, Rule V of Department Order No. 9, Series of
On January 26, 2001, Med-Arbiter Tomas F. Falconitin issued an order,14 ruling that the petition for the cancellation 1997.21
of union registration was not a bar to the holding of the certification election, and disposing thusly:
Upon denial of its motion for reconsideration, the petitioner elevated the matter to the CA by petition for
WHEREFORE, premises considered, respondent employer/protestant’s protest with motion to defer certification of certiorari.22
results and winner is hereby dismissed for lack of merit.
Ruling of the CA
Accordingly, this Office hereby certify pursuant to the rules that petitioner/protestee, National Union of Workers in
Hotels, Restaurants and Allied Industries-Heritage Hotel Manila Supervisory Chapter (NUWHRAIN-HHSMC) is the On December 13, 2005,23 the CA dismissed the petition for certiorari, giving its following disquisition:
sole and exclusive bargaining agent of all supervisory employees of the Heritage Hotel Manila acting through its
owner, Grand Plaza Hotel Corporation for purposes of collective bargaining with respect to wages, and hours of The petition for certiorari filed by the petitioner is, in essence, a continuation of the debate on the relevance of the
work and other terms and conditions of employment. Toyota Motor, Dunlop Slazenger and Progressive Developmentcases to the issues raised.

SO ORDERED. Toyota Motor and Dunlop Slazengerare anchored on the provisions of Article 245 of the Labor Code which prohibit
managerial employees from joining any labor union and permit supervisory employees to form a separate union
The petitioner timely appealed to the DOLE Secretary claiming that: (a) the membership of NUWHRAIN-HHMSC oftheir own. The language naturally suggests that a labor organization cannot carry a mixture of supervisory and
consisted of managerial, confidential, and rank-and-file employees; (b) NUWHRAIN-HHMSC failed to comply with rank-and-file employees. Thus, courts have held that a union cannot become a legitimate labor union if it shelters
the reportorial requirements; and (c) Med-Arbiter Falconitin simply brushed aside serious questions on the under its wing both types of employees. But there are elements of an elliptical reasoning in the holding of these
illegitimacy of NUWHRAINHHMSC.15 It contended that a labor union of mixed membership of supervisory and rank- two cases that a petition for certification election may not prosper until the composition of the union is settled
and-file employees had no legal right to petition for the certification election pursuant to the pronouncements in therein. Toyota Motor, in particular, makes the blanket statement that a supervisory union has no right to file a
Toyota Motor Philippines Corporation v. Toyota Motor Philippines Corporation Labor Union 16 (Toyota Motor) and certification election for as long asit counts rank-and-file employees among its ranks. More than four years after
Dunlop Slazenger (Phils.) v. Secretary of Labor and Employment17 (Dunlop Slazenger). Dunlop Slazenger, the Court clarified in Tagaytay Highlands International Golf Club Inc vs Tagaytay Highlands
Employees Union-PTGWO that while Article 245 prohibits supervisory employees from joining a rank-and-file union,
Ruling of the DOLE Secretary it does not provide what the effect is if a rank-and-fileunion takes in supervisory employees as members, or vice
versa. Toyota Motorand Dunlop Slazenger jump into an unnecessary conclusion when they foster the notion that
Article 245 carries with it the authorization to inquire collaterally into the issue wherever it rears its ugly head.
On August 21, 2002, then DOLE Secretary Patricia A. Sto. Tomas issued a resolution denying the appeal,18 and
affirming the order of MedArbiter Falconitin, viz:
Tagaytay Highlands proclaims, in the light of Department Order 9, that after a certificate of registration is issued to
a union, its legal personality cannot be subject to a collateral attack. It may be questioned only in an independent
petition for cancellation. In fine, Toyota and Dunlop Slazengerare a spent force. Since Tagaytay Highlands was BECAUSE OF THE PASSAGE OFTIME, RESPONDENT UNION NO LONGER POSSESSES THE MAJORITY STATUS SUCH
handed down after these two cases, it constitutes the latest expression of the will of the Supreme Court and THAT A NEW CERTIFICATION ELECTION IS IN ORDER25
supersedes or overturns previous rulings inconsistent with it. From this perspective, it is needless to discuss whether
SPI Technologiesas a mere resolution of the Court may prevail over a full-blown decision that Toyota Motor or The petitioner maintains that the ruling in Tagaytay Highlands International Golf Club Inc v. Tagaytay Highlands
Dunlop Slazenger was. The ruling in SPI Technologies has been echoed in Tagaytay Highlands, for which reason it is Employees Union PTGWO26 (Tagaytay Highlands) was inapplicable because it involved the co-mingling of
with Tagaytay Highlands, not SPI Technologies,that the petitioner must joust. supervisory and rank-and-file employees in one labor organization, while the issue here related to the mixture of
membership between two employee groups — one vested with the right to selforganization (i.e., the rank-and-file
The fact that the cancellation proceeding has not yet been resolved makes it obvious that the legal personality of and supervisory employees), and the other deprived of such right (i.e., managerial and confidential employees); that
the respondent union is still very much in force. The DOLE has thus every reason to proceed with the certification suspension of the certification election was appropriate because a finding of "illegal mixture" of membership during
election and commits no grave abuse of discretion in allowing it to prosper because the right to be certified as a petition for the cancellation of union registration determined whether or not the union had met the 20%
collective bargaining agent is one of the legitimate privileges of a registered union. It is for the petitioner to expedite representation requirement under Article 234(c) of the Labor Code;27 and that in holding that mixed membership
the cancellation case if it wants to put an end to the certification case, but it cannot place the issue of the union’s was not a ground for canceling the union registration, except when such was done through misrepresentation, false
legitimacy in the certification case, for that would be tantamount to making the collateral attack the DOLE has representation or fraud under the circumstances enumerated in Article 239(a) and (c) of the Labor Code, the CA
staunchly argued to be impermissible. completely ignored the 20% requirement under Article 234(c) of the Labor Code.

The reference made by the petitioner to another Progressive Development case that it would be more prudent for The petitioner posits that the grounds for dismissing a petition for the certification election under Section 11, Rule
the DOLE to suspend the certification case until the issue of the legality of the registration is resolved, has also been XI of Department Order No. 9, Series of 1997, were not exclusive because the other grounds available under the
satisfactorily answered. Section 11, Rule XI of Department Order 9 provides for the grounds for the dismissal of a Rules of Courtcould be invoked; that in Progressive Development Corporation v. Secretary, Department of Labor
petition for certification election, and the pendency of a petition for cancellation of union registration is not one of and Employment,28 the Court ruled that prudence could justify the suspension of the certification election
them. Like Toyota Motor and Dunlop Slazenger, the second Progressive case came before Department Order 9. proceedings until the issue of the legality of the union registration could be finally resolved; that the non-submission
of the annual financial statements and the list of members in the period from 1996 to 1999 constituted a serious
IN VIEW OF THE FOREGOING, the disputed resolutions of the Secretary of Labor and Employment are AFFIRMED, challenge to NUWHRAIN-HHMSC’s right to file its petition for the certification election; and that from the time of
and the petition is DISMISSED. the conduct of the certification election on June 23, 2000, the composition of NUWHRAINHHMSC had substantially
changed, thereby necessitating another certification election to determine the true will of the bargaining unit.
SO ORDERED.
In short, should the petition for the cancellation of union registration based on mixed membership of supervisors
and managers in a labor union, and the non-submission of reportorial requirements to the DOLE justify the
The petitioner sought reconsideration,24 but its motion was denied.
suspension of the proceedings for the certification elections or even the denial of the petition for the certification
election?
Issues
Ruling
Hence, this appeal, with the petitioner insisting that:
We deny the petition for review on certiorari.
I
Basic in the realm of labor unionrights is that the certification election is the sole concern of the workers,29 and the
THE COURT OF APPEALS ERRED IN RULING THAT TAGAYTAY HIGHLANDSAPPLIES TO THE CASE AT BAR employer is deemed an intruder as far as the certification election is concerned.30 Thus, the petitioner lacked the
legal personality to assail the proceedings for the certification election,31 and should stand aside as a mere
II bystander who could not oppose the petition, or even appeal the Med-Arbiter’s orders relative to the conduct of
the certification election.32 As the Court has explained in Republic v. Kawashima Textile Mfg., Philippines,
[THE HONORABLE COURT OF APPEALS] SERIOUSLY ERRED WHEN IT DISREGARDED PROGRESSIVE DEVELOPMENT Inc.33(Kawashima):
CORPORATION – PIZZA HUT V. LAGUESMA WHICH HELD THAT IT WOULD BE MORE PRUDENT TO SUSPEND THE
CERTIFICATION CASE UNTIL THE ISSUE OF THE LEGALITY OF THE REGISTRATION OF THE UNION IS FINALLY RESOLVED Except when it is requested to bargain collectively, an employer is a mere bystander to any petition for certification
election; such proceeding is non-adversarial and merely investigative, for the purpose thereof is to determine which
III organization will represent the employees in their collective bargaining with the employer. The choice of their
representative is the exclusive concern of the employees; the employer cannot have any partisan interest therein;
it cannot interfere with, much less oppose, the process by filing a motion to dismiss or an appeal from it; not even
a mere allegation that some employees participating in a petition for certification election are actually managerial
employees will lend an employer legal personality to block the certification election. The employer's only right in Labor authorities should, indeed, act with circumspection in treating petitions for cancellation ofunion registration,
the proceeding is to be notified or informed thereof. lest they be accused of interfering withunion activities. In resolving the petition, consideration must be taken of the
fundamental rights guaranteed by Article XIII, Section 3 of the Constitution, i.e., the rights of all workers to self-
The petitioner’s meddling in the conduct of the certification election among its employees unduly gave rise to the organization, collective bargaining and negotiations, and peaceful concerted activities. Labor authorities should
suspicion that it intended to establish a company union.34 For that reason, the challenges it posed against the bear in mind that registration confers upon a union the status of legitimacy and the concomitant right and privileges
certification election proceedings were rightly denied. granted by law to a legitimate labor organization, particularly the right to participate inor ask for certification
election in a bargaining unit. Thus, the cancellation of a certificate of registration is the equivalent of snuffing out
the lifeof a labor organization. For without such registration, it loses - as a rule - its rights under the Labor Code.
Under the long established rule, too, the filing of the petition for the cancellation of NUWHRAIN-HHMSC’s
registration should not bar the conduct of the certification election.35 In that respect, only a final order for the
cancellation of the registration would have prevented NUWHRAINHHMSC from continuing to enjoy all the rights It is worth mentioning that the Labor Code's provisions on cancellation of union registration and on reportorial
conferred on it as a legitimate labor union, including the rightto the petition for the certification election.36 This rule requirements have been recently amended by Republic Act (R.A.) No. 9481, An Act Strengthening the Workers’
is now enshrined in Article 238-A of the Labor Code, as amended by Republic Act No. 9481,37 which reads: Constitutional Right to Self-Organization, Amending for the Purpose Presidential Decree No. 442, As Amended,
Otherwise Known as the Labor Code of the Philippines, which lapsed into law on May 25, 2007 and became effective
on June 14, 2007. The amendment sought to strengthen the workers’ right to self-organization and enhance the
Article 238-A. Effect of a Petition for Cancellation of Registration. – A petition for cancellation of union registration
Philippines' compliance with its international obligations as embodied in the International Labor Organization (ILO)
shall not suspend the proceedings for certification election nor shall it prevent the filing of a petition for certification
Convention No. 87, pertaining to the non-dissolution of workers’ organizations by administrative authority. Thus,
election.
R.A. No. 9481 amended Article 239 to read:

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ART. 239. Grounds for Cancellation of Union Registration.--The following may constitute grounds for cancellation of
union registration:
Still, the petitioner assails the failure of NUWHRAIN-HHMSC to submit its periodic financial reports and updated list
of its members pursuant to Article 238 and Article 239 of the Labor Code. It contends that the serious challenges
(a) Misrepresentation, false statement or fraud in connection with the adoption or ratification of the
against the legitimacy of NUWHRAIN-HHMSC as a union raised in the petition for the cancellation of union
constitution and by-laws or amendments thereto, the minutes of ratification, and the list of members who
registration should have cautioned the Med-Arbiter against conducting the certification election.
took part in the ratification;

The petitioner does not convince us.


(b) Misrepresentation, false statements or fraud in connection with the election of officers, minutes of
the election of officers, and the list of voters;
In The Heritage Hotel Manila v. National Union of Workers in the Hotel, Restaurant and Allied Industries-Heritage
Hotel Manila Supervisors Chapter (NUWHRAIN-HHMSC),38 the Court declared that the dismissal of the petition for
(c) Voluntary dissolution by the members.
the cancellation of the registration of NUWHRAIN-HHMSC was proper when viewed against the primordial right of
the workers to self organization, collective bargaining negotiations and peaceful concerted actions, viz:
R.A. No. 9481 also inserted inthe Labor Code Article 242-A, which provides:
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ART. 242-A. Reportorial Requirements.--The following are documents required to be submitted to the Bureau by
the legitimate labor organization concerned:
[Articles 238 and 239 of the Labor Code] give the Regional Director ample discretion in dealing with a petition for
cancellation of a union's registration, particularly, determining whether the union still meets the requirements
prescribed by law. It is sufficient to give the Regional Director license to treat the late filing of required documents (a) Its constitution and by-laws, or amendments thereto, the minutes of ratification, and the list of
as sufficient compliance with the requirements of the law. After all, the law requires the labor organization to submit members who took part in the ratification of the constitution and by-laws within thirty (30) days from
the annual financial report and list of members in order to verify if it is still viable and financially sustainable as an adoption or ratification of the constitution and by-laws or amendments thereto;
organization so as to protect the employer and employees from fraudulent or fly-by-night unions. With the
submission of the required documents by respondent, the purpose of the law has been achieved, though belatedly. (b) Its list of officers, minutesof the election of officers, and list of voters within thirty (30) days from
election;
We cannot ascribe abuse of discretion to the Regional Director and the DOLE Secretary in denying the petition for
cancellation of respondent's registration. The union members and, in fact, all the employees belonging to the (c) Its annual financial report within thirty (30) days after the close of every fiscal year; and
appropriate bargaining unit should not be deprived of a bargaining agent, merely because of the negligence of the
union officers who were responsible for the submission of the documents to the BLR. (d) Its list of members at least once a year or whenever required by the Bureau.
Failure to comply with the above requirements shall not be a ground for cancellation of union registration but shall and-file employees. In Dunlop Slazenger, the Court observed that the labor union of supervisors included employees
subject the erring officers or members to suspension, expulsion from membership, or any appropriate penalty. occupying positions that apparently belonged to the rank-and-file. In both Toyota Motorand Dunlop Slazenger, the
employers were able to adduce substantial evidence to prove the existence of the mixed membership. Based on
xxxx the records herein, however, the petitioner failed in that respect. To recall, it raised the issue of the mixed
membership in its comment on the list of members submitted by NUWHRAIN-HHMSC, and in its protest. In the
comment, it merely identified the positions that were either confidential or managerial, but did not present any
The ruling thereby wrote finisto the challenge being posed by the petitioner against the illegitimacy of NUWHRAIN-
supporting evidence to prove or explain the identification. In the protest, it only enumerated the positions that were
HHMSC.
allegedly confidential and managerial, and identified two employees that belonged to the rank-and-file, but did
notoffer any description to show that the positions belonged to different employee groups.
The remaining issue to be resolved is which among Toyota Motor, Dunlop Slazenger and Tagaytay Highlands applied
in resolving the dispute arising from the mixed membership in NUWHRAIN-HHMSC.
Worth reiterating is that the actualfunctions of an employee, not his job designation, determined whether the
employee occupied a managerial, supervisory or rank-and-file position.42 As to confidential employees who were
This is not a novel matter. In Kawashima,39 we have reconciled our rulings in Toyota Motor, Dunlop Slazengerand excluded from the right to self-organization, they must (1) assist or act in a confidential capacity, in regard(2) to
Tagaytay Highlands by emphasizing on the laws prevailing at the time of filing of the petition for the certification persons who formulated, determined, and effectuated management policies in the field of labor relations.43 In that
election. regard, mere allegations sanssubstance would not be enough, most especially because the constitutional right of
workers to selforganization would be compromised.
Toyota Motorand Dunlop Slazenger involved petitions for certification election filed on November 26, 1992 and
September 15, 1995, respectively. In both cases, we applied the Rules and Regulations Implementing R.A. No. 6715 At any rate, the members of NUWHRAIN-HHSMC had already spoken, and elected it as the bargaining
(also known as the 1989 Amended Omnibus Rules), the prevailing rule then. agent.1âwphi1 As between the rigid application of Toyota Motorsand Dunlop Slazenger, and the right of the workers
to self-organization, we preferthe latter. For us, the choice is clear and settled. "What is important is that there is
The 1989 Amended Omnibus Ruleswas amended on June 21, 1997 by Department Order No. 9, Series of 1997. an unmistakeable intent of the members of [the] union to exercise their right to organize. We cannot impose
Among the amendments was the removal of the requirement of indicating in the petition for the certification rigorous restraints on such right if we are to give meaning to the protection to labor and social justice clauses of the
election that there was no co-mingling of rank-and-fileand supervisory employees in the membership of the labor Constitution."44
union. This was the prevailing rule when the Court promulgated Tagaytay Highlands, declaring therein that mixed
membership should have no bearing on the legitimacy of a registered labor organization, unless the co-mingling WHEREFORE, the Court DENIES the petition for review on certiorari; AFFIRMS the decision promulgated on
was due to misrepresentation, false statement or fraud as provided in Article 239 of the Labor Code. 40 Presently, December 13, 2005 by the Court of Appeals; and ORDERS the petitioner to pay the costs of suit.
then, the mixed membership does not result in the illegitimacy of the registered labor union unless the same was
done through misrepresentation, false statement or fraud according to Article 239 of the Labor Code. In Air
SO ORDERED.
Philippines Corporation v. Bureau of Labor Relations,41 we categorically explained that—

Clearly, then, for the purpose of de-certifying a union, it is not enough to establish that the rank-and-file union
includes ineligible employees in its membership. Pursuantto Article 239 (a) and (c) of the Labor Code, it must be
shown that there was misrepresentation, false statement or fraud in connection withthe adoption or ratification of
the constitution and by-laws or amendments thereto, the minutes of ratification, or in connection with the election
of officers, minutes of the election of officers, the list of voters, or failure to submit these documents together with
the list of the newly elected-appointed officers and their postal addresses to the BLR.

We note that NUWHRAIN-HHMSC filed its petition for the certification election on October 11, 1995. Conformably
with Kawashima, the applicable law was the 1989 Amended Omnibus Rules, and the prevailing rule was the
pronouncement in Toyota Motorand Dunlop Slazenger to the effect that a labor union of mixed membership was
not possessed with the requisite personality to file a petition for the certification election.

Nonetheless, we still rule in favor of NUWHRAIN-HHMSC. We expound.

In both Toyota Motorand Dunlop Slazenger, the Court was convinced that the concerned labor unions were
comprised by mixed rank-and-file and supervisory employees. In Toyota Motor, the employer submitted the job
descriptions of the concerned employees to prove that there were supervisors in the petitioning union for rank-