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Labor Relations – Midterm Transcript

AY 2015-2016

LABOR RELATIONS LAW – PRIVATE SECTOR


PART ONE - INTRODUCTORY MATERIALS
Labor Relations Policy: Formulation and Historical Development
1987 Constitution
ART. II. Declaration of State Policies and Principles
Section 2. The Philippines renounces war as an instrument of national policy, adopts the generally accepted principles of
international law as part of the law of the land and adheres to the policy of peace, equality, justice, freedom, cooperation, and
amity with all nations.
Section 10. The State shall promote social justice in all phases of national development.
Section 18. The State affirms labor as a primary social economic force. It shall protect the rights of workers and promote their
welfare.
ART. III. Bill of Rights
Section 8. The right of the people, including those employed in the public and private sectors, to form unions, associations, or
societies for purposes not contrary to law shall not be abridged.
ART. IX. Constitutional Commission
Section 2B (5) The right to self-organization shall not be denied to government employees.
ART. XII. National Economy and Patrimony
Section 12. The State shall promote the preferential use of Filipino labor, domestic materials and locally produced goods, and
adopt measures that help make them competitive.
ART. XIII. Social Justice and Human Right: LABOR
Section 3. The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full
employment and equality of employment opportunities for all.
It shall guarantee the rights of all workers to self-organization, collective bargaining and negotiations, and peaceful concerted
activities, including the right to strike in accordance with law. They shall be entitled to security of tenure, humane conditions of
work, and a living wage. They shall also participate in policy and decision-making processes affecting their rights and benefits as
may be provided by law.
The State shall promote the principle of shared responsibility between workers and employers and the preferential use of
voluntary modes in settling disputes, including conciliation, and shall enforce their mutual compliance therewith to foster
industrial peace.
The State shall regulate the relations between workers and employers, recognizing the right of labor to its just share in the fruits
of production and the right of enterprises to reasonable returns to investments, and to expansion and growth.
ART. XIII. Social Justice and Human Rights: WOMEN
Section 14. The State shall protect working women by providing safe and healthful working conditions, taking into account their
maternal functions, and such facilities and opportunities that will enhance their welfare and enable them to realize their full
potential in the service of the nation.
Labor Code
ART. 3. Declaration of basic policy. - The State shall afford protection to labor, promote full employment, ensure equal work
opportunities regardless of sex, race or creed and regulate the relations between workers and employers. The State shall assure the
rights of workers to self-organization, collective bargaining, security of tenure, and just and humane conditions of work.

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Article. 211. Declaration of Policy. –


A. It is the policy of the State:
a) To promote and emphasize the primacy of free collective bargaining and negotiations, including voluntary arbitration,
mediation and conciliation, as modes of settling labor or industrial disputes;
b) To promote free trade unionism as an instrument for the enhancement of democracy and the promotion of social justice
and development;
c) To foster the free and voluntary organization of a strong and united labor movement;
d) To promote the enlightenment of workers concerning their rights and obligations as union members and as employees;
e) To provide an adequate administrative machinery for the expeditious settlement of labor or industrial disputes;
f) To ensure a stable but dynamic and just industrial peace; and
g) To ensure the participation of workers in decision and policy-making processes affecting their rights, duties and welfare.
B. To encourage a truly democratic method of regulating the relations between the employers and employees by means of
agreements freely entered into through collective bargaining, no court or administrative agency or official shall have the power to set
or fix wages, rates of pay, hours of work or other terms and conditions of employment, except as otherwise provided under this
Code. (As amended by Section 3, Republic Act No. 6715, March 21, 1989).

Article. 275. Tripartism and tripartite conferences. –


(a) Tripartism in labor relations is hereby declared a State policy. Towards this end, workers and employers shall, as far as
practicable, be represented in decision and policy-making bodies of the government.
(b) The Secretary of Labor and Employment or his duly authorized representatives may, from time to time, call a national,
regional, or industrial tripartite conference of representatives of government, workers and employers for the consideration
and adoption of voluntary codes of principles designed to promote industrial peace based on social justice or to align labor
movement relations with established priorities in economic and social development. In calling such conference, the
Secretary of Labor and Employment may consult with accredited representatives of workers and employers. (As amended by
Section 32, Republic Act No. 6715, March 21, 1989).
Cases:
CONSTITUTIONAL LAW; REPUBLIC ACT 809 (SUGAR ACT OF 1952) IS A SOCIAL JUSTICE AND POLICE POWER MEASURE. — Republic
Act 809 is a social justice and police power measure for the promotion of labor conditions in sugar plantations hence whatever
rational degree of constraint it exerts on freedom of contract and existing contractual obligations is constitutional permissible.
TEST OF CONSTITUTIONALITY. — Gone are the days when courts could be adhering to the doctrine that interference with
contracts can only be justified by exceptional circumstances, for the test of validity today under the due process clause, even in
the case of legislation interfering with existing contracts, in reasonableness. In other words, freedom from arbitrariness,
capriciousness and whimsicality is the test of constitutionality.
SOCIAL JUSTICE GOAL SUSTAINS VALIDITY OF A STATUTE. — In the Philippines, whenever any government measure designed for
the advancement of the working class is impugned on constitutional grounds and shadows of doubt are cast over the scope of
the State's prerogative in respect thereto, the imperious mandate of the social justice ideal consecrated in our fundamental laws,
both the old and the new, asserts its majesty, calling upon the courts to accord utmost consideration to the spirit animating the
act assailed, not just for the sake of enforcing the explicit social justice provisions of the article on "Declaration of Principles and
State Policies", but more fundamentally, to serve the sacred cause of human dignity, which is actually what lies at the core of
those constitutional precepts as it is also the decisive element always in the determination of any controversy between capital
and labor.
TEST FOR DETERMINING WHETHER OR NOT SOCIAL JUSTICE HAS BEEN OVEREXTENDED. — The criterion for determining whether
or not social justice has been overextended in any given case is nothing more than the economic viability or feasibility of the

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proposed law in favor of labor, and certainly not the existence of exceptional circumstances. In other words, as long as capital in
industry or agriculture will not be fatally prejudiced to the extent of incurring losses as a result of its enforcement, any legislation
to improve labor conditions would be valid, provided the assailed legislation is more or less demanded as a measure to improve
the situation in which the workers and laborers are actually found.
(Asociacion De Agricultores De Talisay-Silay, Inc. v. Talisay-Silay Milling Co., Inc., G.R. No. L-19937, [February 19, 1979])
The futility of this appeal becomes even more apparent considering the express provision in the Constitution already noted,
requiring the State to assure workers "security of tenure." 17 It was not that specific in the 1935 Charter. The mandate was
limited to the State affording "protection to labor, especially to working women and minors, . . .," 18 If by virtue of the above, it
would not be legally justifiable to reverse the order of reinstatement, it becomes even more readily apparent that such a
conclusion is even more unwarranted now. To reach it would be to show lack of fealty to a constitutional command. This is not to
say that dismissal for cause is now outlawed. No such thing is intimated in this opinion. It is merely no stress that where
respondent Court of Industrial Relations, in the light of all the circumstances disclosed, particularly that it was a first offense after
seventeen years of service, reached the conclusion, neither arbitrary nor oppressive, that dismissal was too severe a penalty, this
Court should not view the matter differently. That is to conform to the ideal of the New Society, the establishment of which was
so felicitously referred to by the First Lady as the Compassionate Society. 19
Much less should the result reached by this Court lend itself to the interpretation that there has been a condonation of theft.
From the facts as found by respondent Court accepted by petitioner, the offense was "breach of trust and violation of the rules
and regulations of the company." A lead material of negligible size, in the opinion of respondent Court, its measurement being
eight inches by ten inches, with thickness of one-half inch, not shown to be of any use to the company, hardly of any pecuniary
worth, was picked up by the employee in question, but thereafter taken from him by a security guard.
That was all that transpired. It would be too harsh an appraisal to view it as constituting theft. So the parties have considered the
matter. It stress is laid on this aspect of the case, it is only to ward off any unwarranted inference that this Court was not properly
mindful of the more serious consequences that should ordinarily follow a dishonest act amounting to a crime.
(PAL v. PALEA, G.R. No. L-24626, [June 28, 1974], 156 PHIL 489-497)
LABOR LAW AND SOCIAL LEGISLATIONS; LABOR CODE; DISMISSAL; NOTICE OF DISMISSAL TO EMPLOYEES BEFORE TERMINATION
REQUIRED. — The guidelines provided in Rule XIV, Book V, Implementing Rules and Regulations, particularly Sections 2, 5 and 6
mandate that the employer furnish an employee sought to be dismissed two (2) written notices of dismissal before a
termination of employment can be legally effected. These are the notice which apprises the employee of theparticular acts or
omissions for which his dismissal is sought and the subsequent notice which informs the employee of the employer's decision to
dismiss him.
DECISION TO DISMISS MAY ONLY BE ISSUED AFTER EMPLOYEES WAS AFFORDED DUE PROCESS. — A reading of the guidelines in
consonance with theexpress provisions of law on protection to labor (which encompasses the right to security of tenure)
and the broader dictates of procedural due process necessarily mandate that notice of the employer's decision to dismiss an
employee, with reasons therefor, can only be issued after the employer has afforded the employee concerned ample
opportunity to be heard and to defend himself.
CONSTITUTIONAL LAW; CIVIL SERVICE; SUBSIDIARIES OF GOVERNMENT OWNED OR CONTROLLED CORPORATION NOT INCLUDED
IN THE AMBIT OF CIVIL SERVICE. — Thus, the situations sought to be avoided by the 1973 Constitution and expressed
by the Court in the National Housing Corporation case in the following manner appear relegated to relative insignificance
by the 1987 Constitutional provision that the Civil Service embraces government-owned or controlled corporations with original
charter; and, therefore, by clear implication, the Civil Service does not include government-owned or controlled corporations
which are organized as subsidiaries of government-owned or controlled corporations under the general corporation law.|||
(National Service Corp. v. NLRC, G.R. Nos. 69870 & 70295, [November 29, 1988], 250 PHIL 129-148)
LABOR LAWS; LABOR CODE; DISMISSAL; GRANT OF SEPARATION PAY TO LAWFULLY DISMISSED EMPLOYEES; BASED ON EQUITY.
— The rule embodied in the Labor Code is that a person dismissed for cause as defined therein is not entitled to separation pay.
The cases above cited constitute the exception, based upon considerations of equity.

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EQUITY DEFINED. — Equity has been defined as justice outside law, being ethical rather than jural and belonging to the sphere of
morals than of law. It is grounded on the precepts of conscience and not on any sanction of positive law. Hence, it cannot prevail
against the expressed provision of the labor laws allowing dismissal of employees for cause and without any provision for
separation pay.
CONSTITUTIONAL BASIS. — Strictly speaking, however, it is not correct to say that there is no express justification for the grant of
separation pay to lawfully dismissed employees other than the abstract consideration of equity. The reason is that our
Constitution is replete with positive commands for the promotion of social justice, and particularly the protection of the rights of
the workers. The enhancement of their welfare is one of the primary concerns of the present charter. In fact, instead of confining
itself to the general commitment to the cause of labor in Article II on the Declaration of Principles of State Policies, the new
Constitution contains a separate article devoted to the promotion of social justice and human rights with a separate sub-topic for
labor. Article XIII expressly recognizes the vital role of labor, hand in hand with management, in the advancement of the national
economy and the welfare of the people in general. The categorical mandates in the Constitution for the improvement of the lot
of the workers are more than sufficient basis to justify the award of separation pay in proper cases even if the dismissal be for
cause.
CONCEPT OF SOCIAL JUSTICE. — The policy of social justice is not intended to countenance wrongdoing simply because it is
committed by the underprivileged. At best it may mitigate the penalty but it certainly will not condone the offense. Compassion
for the poor is an imperative of every humane society but only when the recipient is not a rascal claiming an undeserved
privilege. Social justice cannot be permitted to be refuge of scoundrels any more than can equity be an impediment to the
punishment of the guilty. Those who invoke social justice may do so only if their hands are clean and their motives blameless and
not simply because they happen to be poor. This great policy of our Constitution is not meant for the protection of those who
have proved they are not worthy of it, like the workers who have tainted the cause of labor with the blemishes of their own
character.|||
(Philippine Long Distance Telephone Co. v. National Labor Relations Commission, G.R. No. 80609, [August 23, 1988])

A. Statutory Sources and Interpretation


Cases:
EXISTENCE OF UNFAIR LABOR CASE AGAINST LABOR ORGANIZATION SHOULD NOT RESULT IN THE POSTPONEMENT OF THE
ELECTION. — The existence of an unfair labor practice case against a labor organization, consisting of an illegal strike, would not
suffice to call for the postponement of a proposed certification election, incidentally started at the instance of the employer. If
management is allowed to postpone the certification election pending the determination of the unfair labor case, the result
might be to dilute or fritter away the strength of an organization bent on a more zealous defense of labor prerogatives. The
difficulties and obstacles that must be then hurdled would not be lost on the rest of the personnel, who had not as yet made up
their minds one way or the other. This is not to say that management is to be precluded from filing an unfair labor practice case.
It is merely to stress that such a suit should not be allowed to lend itself as a means, whether intended or not, to prevent a truly
free expression of the will of the labor group as the organization that will represent it. It is not only the loss of time involved, in
itself not likely to enhance the prospect of labor unions, but also the fear engendered in the mind of an ordinary employee that
management has many weapons in its arsenal to bring the full force of its undeniable power against those of its employees
dissatisfied with things as they are. There is no valid reason then for the postponement sought. This is one instance that calls for
the application of the maxim, lex dilationes semper exhorret.|||
PENDENCY OF ULP CASE AGAINST EMPLOYEES SHOULD NOT RESULT IN UNWARRANTED REDUCTION OF THOSE TAKING PART IN
ELECTION. — The Industrial Peace Act speaks of labor organizations "designated or selected for the purpose of collective
bargaining by the majority of the employees in an appropriate collective bargaining unit (shall be the exclusive) representative of
all the employees in such unit for the purpose of collective bargaining." The law clearly contemplates all the employees, not only
some of them. As much as possible then, there is to be no unwarranted reduction in the number of those taking part in a
certification election, even under the guise that in the meanwhile, which may take some time, some of those who are employees
could possibly lose such status, by virtue of a pending unfair labor practice case.

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DETERMINATION OF STATUS OF UNION ALLEGED TO BE COMPANY-DOMINATED MUST PRECEDE CERTIFICATION ELECTION. — If


it were a labor organization objecting to the participation in a certification election of a company-dominated union, as a result of
which a complaint for an unfair labor practice case against the employer is filed, the status of the latter union must be first
cleared in such a proceeding before such voting could take place. It is easily understandable why it should be thus. There would
be an impairment of the integrity of the collective bargaining process if a company-dominated union were allowed to participate
in a certification election. The timid, the timorous, and the faint-hearted in the ranks of labor could easily be tempted to cast
their votes in favor of the choice of the management. Should it emerge victorious, and it becomes the exclusive representative of
labor at the conference table, there is a frustration of the statutory scheme.
STRIKES; PARTICIPATION IN ILLEGAL STRIKE DOES NOT NECESSARILY RESULT IN FORFEITURE OF EMPLOYMENT. — It does not
necessarily follow that whoever might have participated in an illegal strike has thereby forfeited the right to employment.
(B. F. Goodrich Phil. Inc. v. B. F. Goodrich (Marikina Factory) Confidential & Salaried Employees, G.R. Nos. L-34069-70, [February
28, 1973], 151 PHIL 585-597)
"We sincerely believe that good employee relations can be maintained and essential employee needs fulfilled
through sound management administration without the necessity of employee organization and representations.
We respect an employee's right to present his grievances, regardless of whether or not he is represented by a
labor organization." (Italics supplied)
An employee reading the foregoing would at once gain the impression that there was no need to join the Association. For he is
free to present his grievances regardless of whether or not he is represented by a labor organization. (Caltex Filipino Managers
and Supervisors Assn. v. Court of Industrial Relations, G.R. Nos. L-30632-33, [April 11, 1972])

B. Definitions
1. Employer and Employee
(e) "Employer" includes any person acting in the interest of an employer, directly or indirectly. The term shall not include
any labor organization or any of its officers or agents except when acting as employer.
(f) "Employee" includes any person in the employ of an employer. The term shall not be limited to the employees of a
particular employer, unless the Code so explicitly states. It shall include any individual whose work has ceased as a result of
or in connection with any current labor dispute or because of any unfair labor practice if he has not obtained any other
substantially equivalent and regular employment.
Cases:
PRESENCE OF EMPLOYER-EMPLOYEE RELATIONSHIP; CASE AT BAR. — Every professor, instructor, or teacher in the teaching staff
of FEATI University has a contract with the latter for teaching services, albeit for one semester only. The University engaged the
services of the professors, provided them work, and paid them compensation or salary for their services. Even if the University
may be considered as a lessee of services under a contract between it and the members of its Faculty, still it is included in the
term "employer". Running through the word "employ" is the thought that there has been an agreement on the part of one
person to perform a certain service in return for compensation to be paid by an employer. When you ask how a man is
employed, or what is his employment, the thought that he is under agreement to perform some service or services for another is
predominant and paramount (Ballantine Law Dictionary, Phil. Ed., p. 430, citing Pinkerton National Detective Agency vs. Walker,
157 Ga., 548, 35 ALR 557).
SCOPE OF TERM EMPLOYER IN REP. ACT No. 875. — Sec. 2(c) of the Republic Act No. 675 does not state that the employees
included in the definition of the term "employer" are only and exclusively "industrial establishments"; on the contrary, the term
"employer" encompasses all employers except those specifically excluded by the Act.
"TEACHER" ARE CONSIDERED EMPLOYEES. — That teachers are "employees' has been held in a number of cases (Aebli vs. Board
of Education of City and County of San Francisco. 145 P. 2d 601, 62 Cal. App. 2d. 706; Lowe & Campbell Sporting Goods Co. vs.
Tangipahoa Parish School Board, La. App., 15 So 2d 98,100 and other cases). This Court in the Far Eastern University case (L-

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17620, Aug. 31, 1962), considered university instructors as employees and declared Republic Act No. 875applicable to them in
their employment relations with their school.
(FEATI University v. Bautista, G.R. No. L-21278, [December 27, 1966], 125 PHIL 326-371)
2. Labor Organization – Legitimate Labor Organization
(g) "Labor organization" means any union or association of employees which exists in whole or in part for the purpose of
collective bargaining or of dealing with employers concerning terms and conditions of employment.
(h) "Legitimate labor organization" means any labor organization duly registered with the Department of Labor and
Employment, and includes any branch or local thereof.

Cases:
This Court cannot likewise subscribe to the restrictive interpretation made by the court below of the term "labor organization,"
which Section 2(e) of R.A. 875 defines as "any union or association of employees which exists, in whole or in part, for the purpose
of collective bargaining or of dealing with employers concerning terms and conditions of employment." The absence of the
condition which the court below would attach to the statutory concept of a labor organization, as being limited to the employees
of a particular employer, is quite evident from the law. The emphasis of the Industrial Peace Act is clearly on the purposes for
which a union or association of employees is established rather than that membership therein should be limited only to the
employees of a particular employer. Trite to say, under Section 2(h) of R.A. 875 "representative" is defined as including "a
legitimate labor organization or any officer or agent of such organization, whether or not employed by the employer or employee
whom he represents." It cannot be overemphasized likewise that a labor dispute can exist "regardless of whether the disputants
stand in the proximate relation of employer and employee." (Section 2(j), R.A. 875).|||
(Air Line Pilots Ass'n, of the Philippines v. Court of Industrial Relations, G.R. No. L-33705, L-35206, [April 15, 1977])
LABOR AND SOCIAL LEGISLATION; LABOR CODE; CERTIFICATION ELECTION; GENUINE PETITION FROM A LEGITIMATE LABOR
UNION, A REQUISITE. — While Article 257 cited by the Solicitor General directs the automatic conduct of a certification election
in an unorganized establishment, it also requires, however, that the petition for certification election must be filed by a
legitimate labor organization. Article 242 enumerates the exclusive rights of a legitimate labor organization among which is the
right to be certified as the exclusive representative of all the employees in an appropriate collective bargaining unit for purposes
of collective bargaining. Article 212(h) defines a legitimate labor organization as "any labor organization duly registered with the
DOLE and includes any branch or local thereof ." The law did not reduce the Med-Arbiter to an automaton which can instantly be
set to impulse by the mere filing of a petition for certification election. He is still tasked to satisfy himself that all the conditions of
the law are met, and among the legal requirements is that the petitioning union must be a legitimate labor organization in good
standing.
REQUISITES FOR LOCAL OR CHAPTER. — A local or chapter therefore becomes a legitimate labor organization only upon
submission of the following to the BLR: "1) A charter certificate, within 30 days from its issuance by the labor federation or
national union, and 2) The constitution and by-laws, a statement on the set of officers, and the books of accounts all of which are
certified under oath by the secretary or treasurer, as the case may be, of such local or chapter, and attested to by its president.
Absent compliance with these mandatory requirements, the local or chapter does not become a legitimate labor organization."
CHAPTER POSSESSING ONLY A CHARTER CERTIFICATE, NOT A LEGITIMATE LABOR UNION; PETITION FOR CERTIFICATION
ELECTION FILED SHOULD BE DISMISSED. — The only document extant on record to establish the legitimacy of the NACUSIP-TUCP
Lopez Sugar Central Supervisory Chapter is a charter certificate and nothing else. The instant petition, at least for now, must thus
be GRANTED.
(Lopez Sugar Corp. v. Secretary of Labor and Employment, G.R. No. 93117, [August 1, 1995], 317 PHIL 1-9)

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3. Labor Dispute
(l) "Labor dispute" includes any controversy or matter concerning terms and conditions of employment or the association or
representation of persons in negotiating, fixing, maintaining, changing or arranging the terms and conditions of employment,
regardless of whether the disputants stand in the proximate relation of employer and employee.
a. Definition
Cases:
A "labor dispute" as defined in Article 212 (1) of the Labor Code includes "any controversy or matter concerning terms and
conditions of employment or the association or representation of persons in negotiating, fixing, maintaining, changing, or
arranging the terms and conditions of employment, regardless of whether the disputants stand in the proximate relation of
employer and employee."
While it is SanMig's submission that no employer-employee relationship exists between itself, on the one hand, and the
contractual workers of Lipercon and D'Rite on the other, a labor dispute can nevertheless exist "regardless of whether the
disputants stand in the proximate relationship of employer and employee" (Article 212 [1], Labor Code, supra) provided the
controversy concerns, among others, the terms and conditions of employment or a "change" or "arrangement" thereof (ibid). Put
differently, and as defined by law, the existence of a labor dispute is not negatived by the fact that the plaintiffs and defendants
do not stand in the proximate relation of employer and employee.
That a labor dispute, as defined by the law, does exist herein is evident. At bottom, what the Union seeks is to regularize the
status of the employees contracted by Lipercon and D'Rite and, in effect, that they be absorbed into the working unit of SanMig.
This matter definitely dwells on the working relationship between said employees vis-a-vis SanMig. Terms, tenure and conditions
of their employment and the arrangement of those terms are thus involved bringing the matter within the purview of a labor
dispute. Further, the Union also seeks to represent those workers, who have signed up for Union membership, for the purpose of
collective bargaining. SanMig, for its part, resists that Union demand on the ground that there is no employer-employee
relationship between it and those workers and because the demand violates the terms of their CBA. Obvious then is that
representation and association, for the purpose of negotiating the conditions of employment are also involved. In fact, the
injunction sought by SanMig was precisely also to prevent such representation. Again, the matter of representation falls within
the scope of a labor dispute. Neither can it be denied that the controversy below is directly connected with the labor dispute
already taken cognizance of by the NCMB-DOLE (NCMB-NCR-NS-O1-021-89; NCMB NCR NS-01-093-83).
(San Miguel Corp. Employees Union v. Bersamira, G.R. No. 87700, [June 13, 1990], 264 PHIL 875-885)
LABOR AND SOCIAL LEGISLATION; LABOR CODE; STRIKE; DEFINED; PRESENT IN CASE AT BAR. — A strike, considered as the most
effective weapon of labor, is defined as any temporary stoppage of work by the concerted action of employees as a result of an
industrial or labor dispute. A labor dispute includes any controversy or matter concerning terms or conditions of employment or
the association or representation of persons in negotiating, fixing, maintaining, changing or arranging the terms and conditions of
employment, regardless of whether or not the disputants stand in the proximate relation of employers and employees. Private
respondents and their co-workers stopped working and held the mass action on April 30, 1985 to press for their wages and other
benefits. What transpired then was clearly a strike, for the cessation of work by concerted action resulted from a labor
dispute.|||
(Gold City Integrated Port Service, Inc. v. NLRC, G.R. No. 103560, 103599, [July 6, 1995])

b. Test for determining Labor Dispute


Cases:
The flimsy and insubstantial character of the petition is thus exposed. It sought to escape the fate thus foreordained by inviting
the attention of this Tribunal to what it referred to as legal complications arising from the enforcement of the writ of execution
when considered in connection with Presidential Decree No. 21. 23 After noting that it had to get replacements during the
pendency of this case, now still unresolved after five long years, it cited Section 11 of Presidential Decree No. 21: "No employer
may shut down his establishment or dismiss or terminate the services of regular employees with at least one year of service

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without the written clearance of the Secretary of Labor." It would thus be faced, according to its petition, "with the legal problem
of being exposed to violating the provisions of said decree. This is so, because in the process of complying immediately with the
alias writ of execution, for every number of petitioners who shall be reinstated to their former positions, the corresponding
number of employees who are now holding such positions will be laid off. And laying off or dismissals cannot be done without
the written clearance of the Secretary of Labor. It is foreseen also that written clearance shall treat of individual cases of
employees to be laid off. The process therefore will involve the [employee] presenting himself to be returned to work, and the
securing of the written clearance for the dismissal of the employee whom he will replace." 24 It would be hard put, according to
it, to make a choice between a possible charge for contempt on the one hand, and arrest and detention on the other, if it would
appear that there was a violation of Presidential Decree No. 21. The dilemma is more apparent than real. There is no conflict
between the aforesaid presidential decree and the return-to-work order. This is not the occasion to pass upon the possible
adverse effects, if any, on the situation of the replacements. It might be mentioned that under the circumstances, their tenure
could be made to depend on the outcome of the pending case and whatever valid orders may be issued in the meanwhile by
respondent Court. 25 At any rate, it goes without saying that whatever rights they have must be respected. It certainly does not
rule out giving force and effect to an order of the labor tribunal, unfortunately until now disregarded. Even on the assumption,
then, that difficulties would be attendant on the faithful observance of the return-to-work order, petitioner has nobody to blame
but itself. As far back as April 23, 1968, its obligation was clear. Instead of yielding obedience, it employed dilatory tactics to
delay its implementation. It cannot thereafter just simply fold its hands and assert that it still should be allowed to persist in
conduct marked by obstinacy it could amount, if it were otherwise, to a party benefiting from its own defiance of a lawful order.
Nor is this the only objection to such a contention reached by petitioner. It could be that it is not fully cognizant of the pernicious
consequences which it would spawn if accorded acceptance. A presidential decree intended to ameliorate still further the
conditions of labor would be subjected to an interpretation not for its benefit but to enable an employer to continue with a
conduct that cannot be characterized as other than a disdainful indifference to a valid order. If, as seems to be implied in its
petition, it is likewise concerned with the fate of the replacements, there is nothing to prevent it from continuing their
employment. That would be, in a way, to atone for its intransigence. What is more, it would be to accord genuine respect for the
intent of Presidential Decree No. 21. What cannot be overemphasized is that such a decree which has received the imprimatur of
the present Constitution 26 is in consonance with the much more detailed provision therein contained, intended to make a
reality of governmental efforts to protect labor. It is worded thus: "The State shall afford protection to labor, promote full
employment and equality in employment, ensure equal work opportunities regardless of sex, race, or creed, and regulate the
relations between workers and employers. The State shall assure the right of workers to self-organization, collective bargaining,
security of tenure, and just and humane conditions of work. The State may provide for compulsory arbitration." 27
(RCPI v. Philippine Communications Electronics & Electricity Workers' Federation, G.R. No. L-37662, [August 30, 1974], 160 PHIL
87-101)

C. Labor Relations Policy


1. Dispute Settlement Methodology
Article. 211. Declaration of Policy. - A. It is the policy of the State:
(a) To promote and emphasize the primacy of free collective bargaining and negotiations, including voluntary arbitration,
mediation and conciliation, as modes of settling labor or industrial disputes;

2. Collective Bargaining
Cases:
Collective bargaining which is defined as negotiations towards a collective agreement, 6 is one of the democratic frameworks
under the New Labor Code, designed to stabilize the relation between labor and management and to create a climate of sound
and stable industrial peace. It is a mutual responsibility of the employer and the Union and is characterized as a legal obligation.
So much so that Article 249, par. (g) of the Labor Code makes it an unfair labor practice for an employer to refuse "to meet and
convene promptly and expeditiously in good faith for the purpose of negotiating an agreement with respect to wages, hours of

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work, and all other terms and conditions of employment including proposals for adjusting any grievance or question arising
under such an agreement and executing a contract incorporating such agreement, if requested by either party."
While it is a mutual obligation of the parties to bargain, the employer, however, is not under any legal duty to initiate contract
negotiation. 7 The mechanics of collective bargaining is set in motion only when the following jurisdictional preconditions are
present, namely, (1) possession of the status of majority representation of the employees' representative in accordance with any
of the means of selection or designation provided for by the Labor Code; (2) proof of majority representation; and (3) a demand
to bargain under Article 251, par. (a) of the New Labor Code . . . all of which preconditions are undisputedly present in the instant
case.
(Loy v. NLRC, G.R. No. L-54334, [January 22, 1986], 225 PHIL 138-147)

3. Trade Unionism
Article. 211. Declaration of Policy. - A. It is the policy of the State:
(b) To promote free trade unionism as an instrument for the enhancement of democracy and the promotion of social justice
and development;
(c) To foster the free and voluntary organization of a strong and united labor movement;
(g) To ensure the participation of workers in decision and policy-making processes affecting their rights, duties and welfare.

4. Worker Enlightenment
Article. 211. Declaration of Policy. –
A. It is the policy of the State:
(d) To promote the enlightenment of workers concerning their rights and obligations as union members and as employees;
Article 241. Rights and conditions of membership in a labor organization. The following are the rights and conditions of
membership in a labor organization:
(p) It shall be the duty of any labor organization and its officers to inform its members on the provisions of its constitution
and by-laws, collective bargaining agreement, the prevailing labor relations system and all their rights and obligations under
existing labor laws.
Article. 277. Miscellaneous provisions. –
(a) All unions are authorized to collect reasonable membership fees, union dues, assessments and fines and other
contributions for labor education and research, mutual death and hospitalization benefits, welfare fund, strike fund and
credit and cooperative undertakings. (As amended by Section 33, Republic Act No. 6715, March 21, 1989).

Cases:
LABOR LAW; LABOR RELATIONS; COLLECTIVE BARGAINING AGREEMENT; EMERGENCY LEAVE WITH PAY; PURPOSE;
REQUIREMENT THAT ACTUAL SERVICE FOR SPECIFIED PERIOD DURING YEAR BE RENDERED BY EMPLOYEE BEFORE CLAIMING
BENEFIT ABSURD; CASE AT BAR. — The provision of the CBA is clear: (1) the employee must be a member of the Regular Labor
Pool; (2) he is entitled to only six (6) days emergency leave with pay per calendar year; and (3) he must have rendered service for
at least six (6) months during the year when he took his emergency leave. The emergency leave may be staggered or it may last
for any number of days as emergencies arise but the employee is entitled only to six (6) days of emergency leave "with pay" per
year. Since the emergency leave is allowed to enable the employee to attend to an emergency in his family or household, it may
be taken at any time during the calendar year but he must render at least six months service for that year to be entitled to collect
his wages for the six (6) days of his emergency leave. Since emergencies are unexpected and unscheduled happenings, it would

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be absurd to require the employee to render six (6) months service before being entitled to take a six-day-emergency leave with
pay for it would mean that no emergency leave can be taken by an employee during the first six months of a calendar year.|||
(Davao Integrated Port and Stevedoring Services Corp. v. Olvida, G.R. No. 93983, [June 29, 1992])
DUTY AND RESPONSIBILITY OF A UNION LEADER. — Petitioner as a union leader, must see to it that the policies and activities of
the union in the conduct of labor relations are within the precepts of law and any deviation from the legal boundaries shall be
imputable to the leader. He bears the responsibility of guiding the union along the path of law and to cause the union to demand
what is not legally demandable, would foment anarchy which is a prelude to chaos. Petitioner should have known and it was his
duty to impart this imputed knowledge to the members of the union that employees and laborers in non-profit organizations are
not covered by the provisions of the Industrial Peace Act and the Court of Industrial Relations [in the case at bar, the Court of
First Instance] has no jurisdiction to entertain petitions of labor unions or organizations of said non-profit organizations for
certification as the exclusive bargaining representatives of said employees and laborers.|||
(Victoria v. Inciong, G.R. No. L-49046, [January 26, 1988], 241 PHIL 346-357)

5. Machinery Dispute Settlement


Article. 211. Declaration of Policy. - A. It is the policy of the State:
(e) To provide an adequate administrative machinery for the expeditious settlement of labor or industrial disputes;

6. Industrial Peace
Article. 211. Declaration of Policy. - A. It is the policy of the State:
(f) To ensure a stable but dynamic and just industrial peace; and
Article. 273. Study of labor-management relations. - The Secretary of Labor shall have the power and it shall be his duty to
inquire into:
(a) the existing relations between employers and employees in the Philippines;

7. Worker Participation in Decision-Making


Article. 211. Declaration of Policy. - A. It is the policy of the State:
(g) To ensure the participation of workers in decision and policy-making processes affecting their rights, duties and welfare.
Article. 277. Miscellaneous provisions.
(g) The Ministry shall help promote and gradually develop, with the agreement of labor organizations and employers, labor-
management cooperation programs at appropriate levels of the enterprise based on the shared responsibility and mutual
respect in order to ensure industrial peace and improvement in productivity, working conditions and the quality of working
life.
Test on Existence of Right to Participate
Cases:
Indeed, industrial peace cannot be achieved if the employees are denied their just participation in the discussion of matters
affecting their rights. Thus, even beforeArticle 211 of the Labor Code (P.D. 442) was amended by Republic Act No. 6715, it was
already declared a policy of the State: "(d) To promote the enlightenment of workers concerning their rights and obligations . .
.as employees." This was, of course, amplified by Republic Act No. 6715 when it decreed the "participation of workers in decision
and policy making processes affecting their rights, duties and welfare." PAL's position that it cannot be saddled with the
"obligation" of sharing management prerogatives as during the formulation of the Code, Republic Act No. 6715 had not yet been

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enacted (Petitioner's Memorandum, p. 44; Rollo, p. 212), cannot thus be sustained. While such "obligation" was not yet founded
in law when the Code was formulated, the attainment of a harmonious labor-management relationship and the then already
existing state policy of enlightening workers concerning their rights as employees demand no less than the observance of
transparency in managerial moves affecting employees' rights.|||
(Philippine Airlines, Inc. v. NLRC, G.R. No. 85985, [August 13, 1993])

8. Wage Fixing
Article. 211. Declaration of Policy. - A. It is the policy of the State:
(b) To promote free trade unionism as an instrument for the enhancement of democracy and the promotion of social justice
and development;

9. Labor Injunction
Article 254. Injunction prohibited. – No temporary or permanent injunction or restraining order in any case involving or
growing out of labor disputes shall be issued by any court or other entity, except as otherwise provided in Articles 218 and
264 of this Code. (As amended by Batas Pambansa Bilang 227, June 1, 1982).

Article. 218. Powers of the Commission. - The Commission shall have the power and authority:
(e) To enjoin or restrain any actual or threatened commission of any or all prohibited or unlawful acts or to require the
performance of a particular act in any labor dispute which, if not restrained or performed forthwith, may cause grave or
irreparable damage to any party or render ineffectual any decision in favor of such party: Provided, That no temporary or
permanent injunction in any case involving or growing out of a labor dispute as defined in this Code shall be issued except
after hearing the testimony of witnesses, with opportunity for cross-examination, in support of the allegations of a
complaint made under oath, and testimony in opposition thereto, if offered, and only after a finding of fact by the
Commission, to the effect:
a. That prohibited or unlawful acts have been threatened and will be committed and will be continued unless
restrained, but no injunction or temporary restraining order shall be issued on account of any threat, prohibited or
unlawful act, except against the person or persons, association or organization making the threat or committing the
prohibited or unlawful act or actually authorizing or ratifying the same after actual knowledge thereof;
b. That substantial and irreparable injury to complainants property will follow;
c. That as to each item of relief to be granted, greater injury will be inflicted upon complainant by the denial of relief
than will be inflicted upon defendants by the granting of relief;
d. That complainant has no adequate remedy at law; and
e. That the public officers charged with the duty to protect complainants property are unable or unwilling to furnish
adequate protection.
Article. 266. Requirement for arrest and detention. - Except on grounds of national security and public peace or in case of
commission of a crime, no union members or union organizers may be arrested or detained for union activities without
previous consultations with the Secretary of Labor.
Rationale for Policy on Injunction
Cases:
It is well known that the scheme in Republic Act No. 875 for achieving industrial peace rests essentially on a free and private
agreement between the employer and his employees as to the terms and conditions under which the employer is to give work

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and the employees are to furnish labor, unhampered as far as possible by judicial or administrative intervention. On this premise
the lawmaking body has virtually prohibited the issuance of injunctive relief involving or growing out of labor disputes.
The prohibition to issue labor injunctions is designed to give labor a comparable bargaining power with capital and must be
liberally construed to that end (U.S. vs. Brotherhood of Locomotive Engineers, 79 F. Supp. 485, Certiorari denied, 69 S. Ct. 137,
335 U.S. 867, cause remanded on other grounds, 174 F. 2nd 160, 85 U.S. App. D.C., certiorari denied 70 S. Ct. 140, 338 U.S. 872,
94 L. Ed. 535). It is said that the prohibition creates substantive and not purely procedural law. (Oregon Shipbuilding Corporation
vs. National Labor Relations Board, 49 F. Supp. 386). Within the purview of our ruling, speaking through Justice Labrador, in
Social Security Employees Association (PAFLU), et al. vs. The Hon. Edilberto Soriano, et al. (G.R. No. L-20100, July 16, 1964, 11
SCRA 518, 520), there can be no injunction issued against any strike except in only one instance, that is, when a labor dispute
arises in an industry indispensable to the national interest and such dispute is certified by the President of the Philippines to the
Court of Industrial Relations in compliance with Sec. 10 of Republic Act No. 875. As a corollary to this, an injunction in an
uncertified case must be based on the strict requirements of Sec. 9(d) of Republic Act No. 875; the purpose of such an injunction
is not to enjoin the strike itself, but only unlawful activities. To the extent, then, that the Company sought injunctive relief under
Sec. 9(d) of Republic Act No. 875, respondent court had jurisdiction over the Company's "Urgent Petition" dated April 26, 1965.
(Caltex Filipino Managers and Supervisors Assn. v. Court of Industrial Relations, G.R. Nos. L-30632-33, [April 11, 1972])

10. Tripartism
Article. 275. Tripartism and tripartite conferences. –
(a) Tripartism in labor relations is hereby declared a State policy. Towards this end, workers and employers shall, as far as
practicable, be represented in decision and policy-making bodies of the government.
(b) The Secretary of Labor and Employment or his duly authorized representatives may, from time to time, call a national,
regional, or industrial tripartite conference of representatives of government, workers and employers for the consideration
and adoption of voluntary codes of principles designed to promote industrial peace based on social justice or to align labor
movement relations with established priorities in economic and social development. In calling such conference, the
Secretary of Labor and Employment may consult with accredited representatives of workers and employers.

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PART TWO – RIGHT TO SELF ORGANIZATION


A. BASIS OF RIGHT
1. Constitution

2. Statutory
Article 243. Coverage and employees right to self-organization. All persons employed in commercial, industrial and
agricultural enterprises and in religious, charitable, medical, or educational institutions, whether operating for profit or not,
shall have the right to self-organization and to form, join, or assist labor organizations of their own choosing for purposes of
collective bargaining. Ambulant, intermittent and itinerant workers, self-employed people, rural workers and those without
any definite employers may form labor organizations for their mutual aid and protection.
Article 244. Right of employees in the public service. – Employees of government corporations established under the
Corporation Code shall have the right to organize and to bargain collectively with their respective employers. All other
employees in the civil service shall have the right to form associations for purposes not contrary to law. Article 245.
Ineligibility of managerial employees to join any labor organization; Right of Supervisory Employees. - Managerial
employees are not eligible to join, assist or form any labor organization. Supervisory employees shall not be eligible for
membership in the collective bargaining unit of the rank-and-file employees but may join, assist or form separate collective
bargaining units and/or legitimate labor organizations of their own. The rank-and-file union and the supervisors union
operating within the same establishment may join the same federation or national union.
Cases:
CONSTITUTIONAL LAW; FREEDOM OF ASSOCIATION. — The freedom of association explicitly ordained in our Constitution is not
merely derivative, peripheral or penumbral, as is the case in the United States. It can trace its origin to the Malolos Constitution.
The freedom of employees to choose which labor organization to join is an aspect of the constitutional mandate of protection to
labor.
LABOR DISAFFILIATION FROM LABOR ORGANIZATION. — The disaffiliation of the employees from their union is not a new
phemenon in the Philippine labor movement, nor it is open to any legal objection. It is implicit in the freedom of association
explicitly ordained by the Constitution. Any individual has the incontrovertible right to join an organization of his choice. That
option belongs to him. A workingman is not to be denied that liberty. Once the fact of disaffiliation has been demonstrated
beyond doubt, a certification election is the most expeditious was of determining which labor organization is to be the exclusive
bargaining representative.
(Vassar Industries Employees Union v. Estrella, G.R. No. L-46562, [March 31, 1978], 172 PHIL 272-280)
LABOR AND SOCIAL LEGISLATION; LABOR CODE; EMPLOYMENT; EMPLOYER-EMPLOYEE RELATIONSHIP; ELEMENTS. — The
following elements are generally considered in the determination of the employer-employee relationship; "(1) the selection and
engagement of the employee; (2) the payment of wages; (3) the power of dismissal; and (4) the power to control the employee's
conduct — although the latter is the most important element" (Mafinco Trading Corporation v. Ople, 70 SCRA 139 [1976];
Development Bank of the Philippines v. National Labor Relations Commission, 175 SCRA 537 [1989] and other cases cited)|||
CONTROL TEST; MOST IMPORTANT ELEMENT; CASE AT BAR. — The last and most important element of the control test is not
satisfied by the terms and conditions of the contracts. There is nothing in the agreement which implies control by the Company
not only over the end to be achieved but also over the means and methods in achieving the end (LVN Pictures, Inc. v. Philippine
Musicians Guild, 1 SCRA 132 [1961]).
ARTICLE 280, NOT THE YARDSTICK FOR DETERMINING EXISTENCE OF EMPLOYMENT RELATIONSHIP. — Article 280 is not the
yardstick for determining the existence of an employment relationship because it merely distinguishes between two kinds of
employees, i.e., regular employees and casual employees, for purposes of determining the right of an employee to certain
benefits, to join or form a union, or to security of tenure. Article 280 does not apply where the existence of an employment
relationship is in dispute.

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(Singer Sewing Machine Co. v. Drilon, G.R. No. 91307, [January 24, 1991], 271 PHIL 282-293)
LABOR RELATIONS; INELIGIBILITY OF MANAGERIAL EMPLOYEES TO JOIN, FORM AND ASSIST ANY LABOR ORGANIZATION;
PROHIBITION EXTENDED TO CONFIDENTIAL EMPLOYEES. — Although Article 245 of the Labor Code limits the ineligibility to join,
form and assist any labor organization to managerial employees, jurisprudence has extended this prohibition to confidential
employees or those who by reason of their positions or nature of work are required to assist or act in a fiduciary manner to
managerial employees and hence, are likewise privy to sensitive and highly confidential records.
EXCLUSION OF CONFIDENTIAL EMPLOYEES FROM THE RANK AND FILE BARGAINING UNIT; NOT TANTAMOUNT TO
DISCRIMINATION. — Confidential employees cannot be classified as rank and file. As previously discussed, the nature of
employment of confidential employees is quite distinct from the rank and file, thus, warranting a separate category. Excluding
confidential employees from the rank and file bargaining unit, therefore, is not tantamount to discrimination.
(Metrolab Industries, Inc. v. Roldan-Confesor, G.R. No. 108855, [February 28, 1996], 324 PHIL 416-443)

B. EXTENT AND SCOPE OF RIGHT

Article 246. Non-abridgment of right to self-organization. It shall be unlawful for any person to restrain, coerce,
discriminate against or unduly interfere with employees and workers in their exercise of the right to self-organization. Such
right shall include the right to form, join, or assist labor organizations for the purpose of collective bargaining through
representatives of their own choosing and to engage in lawful concerted activities for the same purpose or for their mutual
aid and protection, subject to the provisions of Article 264 of this Code.
Cases:
LABOR LAW; EMPLOYEE'S RIGHT TO SELF-ORGANIZATION; GUARANTEED BY THE LABOR CODE. — Guaranteed to all employees or
workers is the "right to self-organization and to form, join, or assist labor organizations of their own choosing for purposes of
collective bargaining." This is made plain by no less than three provisions of the Labor Code of the Philippines. [As amended inter
alia by R.A. Nos. 6715, 6725 AND 6727] Article 243 of the Code provides as follows: ART. 243.Coverage and employees right to
self-organization. — All persons employed in commercial, industrial and agricultural enterprises and in religious, charitable,
medical, or educational institutions whether operating for profit or not, shall have the right to self-organization and to form, join,
or assist labor organizations of their own choosing for purposes of collective bargaining. Ambulant, intermittent and itinerant
workers, self-employed people, rural workers and those without any definite employers may form labor organizations for their
mutual aid and protection. Article 248 (a) declares it to be an unfair labor practice for an employer, among others, to "interfere
with, restrain or coerce employees in the exercise of their right to self-organization." Similarly, Article 249 (a) makes it an unfair
labor practice for a labor organization to "restrain or coerce employees in the exercise of their rights to self-organization . . . ."
The same legal proposition is set out in the Omnibus Rules Implementing the Labor Code, as amended, as might be expected.
Section 1, Rule II (Registration of Unions), Book V (Labor Relations) of the Omnibus Rules provides as follows: "SEC. 1. Who may
join unions; exception. — All persons employed in commercial, industrial and agricultural enterprises, including employees of
government corporations established under the Corporation Code as well as employees of religious, medical or educational
institutions, whether operating for profit or not, except managerial employees, shall have the right to self-organization and to
form, join or assist labor organizations for purposes of collective bargaining. Ambulant, intermittent and itinerant workers, self-
employed people, rural workers and those without any definite employers may form labor organizations for their mutual aid and
protection.|||
(Reyes v. Trajano, G.R. No. 84433, [June 2, 1992])
Thus, it can be readily seen from the above findings of the Bureau of Labor Relations that the members of private respondent are
not managerial employees as claimed by petitioners but merely considered as rank-and-file employees who have every right to
self-organization or to be heard through a duly certified collective bargaining union. The Supervisory power of the members of
private respondent union consists merely in recommending as to what managerial actions to take in disciplinary cases. These
members of private respondent union do not fit the definition of managerial employees which We laid down in the case of
Bulletin Publishing Corporation v. Sanchez (144 SCRA 628). These members of private respondent union are therefore not

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prohibited from forming their own collective bargaining unit since it has not been shown by petitioner that "the responsibilities
(of these monthly-paid-employees) inherently require the exercise of discretion and independent judgment as supervisors" or
that "they possess the power and authority to lay down or exercise management policies." Similarly, We held in the same case
that "Members of supervisory unions who do not fall within the definition of managerial employees shall become eligible to join
or assist the rank-and-file labor organization, and if none exists, to form or assist in the forming of such rank-and-file
organizations."|||
(General Rubber and Footwear Corp. v. Bureau of Labor Relations, G.R. No. 74262, [October 29, 1987], 239 PHIL 276-282)
CONSTITUTIONAL LAW; BILL OF RIGHTS; RIGHT TO FORM UNION OR ASSOCIATIONS; SCOPE. — The right to form a union or
association or to self-organization comprehends two (2) broad notions, to wit: (a) the liberty or freedom, i.e., the absence of
restraint which guarantees that the employee may act for himself without being prevented by law, and (b) the power, by virtue
of which an employee may, as he pleases, join or refrain from joining an association. (Victoriano vs. Elizalde Rope Workers'
Union, 59 SCRA 54).
LABOR AND SOCIAL LEGISLATION; LABOR CODE; LABOR RELATIONS; ONE COMPANY-ONE UNION POLICY; NOT APPLICABLE
WHERE EXISTING UNION COVERED ONLY ONE CLASS OF EMPLOYEES; CASE AT BAR. — in the bargaining history of KNITJOY, the
CBA has been consistently limited to the regular rank-and-file employees paid on a daily or piece-rate basis. On the other hand,
the rank-and-file employees paid on a monthly basis were never included within its scope. Respondent KMEU's membership is
limited to the latter class of employees, KMEU does not seek to dislodge CFW as the exclusive bargaining representative for the
former. The records further disclose that in the certification solicited by TUPAS and during the elections which followed
thereafter, resulting in the certification of CFW as the exclusive bargaining representative, the monthly-paid employees were
expressly excluded. Thus, the negotiations between CFW and KNITJOY following such a certification could only logically refer to
the rank-and-file employees paid on a daily or piece-rate basis. Clearly therefore, KNITJOY and CFW recognize that insofar as the
monthly-paid employees are concerned, the latter's constituting a separate bargaining unit with the appropriate union as sole
bargaining representative, can neither be prevented nor avoided without infringing on these employees' rights to form a union
and to enter into collective bargaining negotiations. Stated differently, KNITJOY and CFW recognize the fact that the existing
bargaining unit in the former is not — and has never been — the employer unit. Given this historical and factual setting, KMEU
had the unquestioned and undisputed right to seek certification as the exclusive bargaining representative for the monthly-paid
rank-and-file employees; both KNITJOY and CFW cannot block the same on the basis of this Court's declaration in Bulletin
Publishing Corp. vs. Hon. Sanchez 15 and General Rubber and Footwear Corp. vs. Bureau of Labor Relations (155 SCRA 283 [1987])
regarding the one-company-one union concept.
(Knitjoy Manufacturing, Inc. Ferrer-Calleja, G.R. No. 81883, 82111, [September 23, 1992])

LABOR AND SOCIAL LEGISLATION; LABOR RELATIONS; REGISTRATION OF UNION NOT PROHIBITED WITHIN ONE YEAR FROM
ISSUANCE OF FINAL CERTIFICATION ELECTION RESULT. — Section 3, Rule V, Book V of the Omnibus Rules Implementing the Labor
Code, prohibits not the registration of a new union but the holding of a certificate election "within one year from the date of
issuance of a final certification election result." Clearly, private respondent's registration is not covered by the prohibition. In any
event, the union registration was effected in September 1990, a month before the secretary of labor issued his decision on the
result of the certification election on October 31, 1990. Hence, there was yet no certified bargaining agent when the private
respondent was registered as a union.
ONE UNION IN ONE COMPANY POLICY, SUBJECT TO EXCEPTIONS. — As regards petitioner's battle cry of "one union in one
company," this Court has already laid down in Knitjoy Manufacturing, Inc. vs. Ferrer-Calleja the exceptions to that policy. The
Court, through Mr. Justice Hilario G. Davide, Jr., held that "the suggested bias of the Labor Code in favor of the one company-one
union policy, anchored on the greater mutual benefits which the parties could derive, especially in the case of employees whose
bargaining strength could undeniably be enhanced by their unity and solidarity but diminished by their disunity, division and
dissension, is not without exceptions. The present Article 245 of the Labor Code expressly allows supervisory employees who are
not performing managerial functions to join, assist or form their separate union but bars them from membership in a labor
organization of the rank-and-file employees. "This provision obviously allows more than one union in a company. Even Section 2
(c), Rule V, Book V of the Implementing Rules and Regulations of the Labor Code, which seeks to implement the policy, also
recognizes exceptions. The usual exception, of course, is where the employer unit has to give way to the other units like the craft

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unit, plant unit, or a subdivision thereof; the recognition of these exceptions takes into account the policy to assure employees of
the fullest freedom in exercising their rights. (PASCUAL C., Labor Relations Law, 1986, ed., 109) Otherwise stated, the one
company-one union policy must yield to the right of the employees to form unions or associations for purposes not contrary to
law, to self-organization and to enter into collective bargaining negotiations, among others, which the Constitution guarantees.
(Section 8, Article III and Section 3, Article XIII, 1987 Constitution)."
(Katipunan ng mga Manggagawa sa Daungan v. Ferrer-Calleja, G.R. No. 104692, [September 5, 1997], 344 PHIL 67-77)
CONSTITUTIONAL LAW; FREEDOM OF LABORERS TO FORM ORGANIZATIONS; SUCH FREEDOM IS RENDERED NUGATORY IF UNION
OFFICIALS INVOLVED ARE EXCLUDED FROM RETURN-TO-WORK ORDER. — By petitioner's plea to exclude from a return-to-work
order five union officials of respondent Pan American Employees Association on the ground of having led an illegal strike, the
greater offense is to the labor movement itself, more specifically to the right of self-organization. There is both a constitutional
and statutory recognition that laborers have the right to form unions to take care of their interests vis-a-vis their employers.
Their freedom to form organizations would be rendered nugatory if they could not choose their own leaders to speak on their
behalf and to bargain for them. Apparently, respondent Court was alive to the implication of such an unwarranted demand, the
effect of which would have been to deprive the rank and file of their freedom of choice as to who should represent them. For
what use are leaders so undeserving of the minimum confidence. To that extent then, their constitutional and statutory right to
freedom of association suffers an impairment hardly to be characterized as inconsequential.|||
(Pan American World Airways, Inc. v. Pan American Employees Ass'n, G.R. No. L-25094, [April 29, 1969], 137 PHIL 826-834)
RIGHTS OF EMPLOYEES ILLEGALLY DISMISSED. — An employee or laborer illegally dismissed is entitled to reinstatement with
back wages pursuant to the policy to decree back wages not exceeding three (3) years without requiring the parties to submit
proof of compensation received from other sources at the time of illegal dismissal until actual reinstatement, in order that
judgment in favor of an employee or laborer can be executed without delay (Luzon Stevedoring Corp. vs. C.I.R., 61 SCRA 162).|||
(Union of Supervisors v. Secretary of Labor, G.R. No. L-39889, [November 12, 1981], 195 PHIL 691-718)

C. WORKERS WITH THE RIGHT TO SELF-ORGANIZATION


1. All Employees
Article 243. Coverage and employees right to self-organization. All persons employed in commercial, industrial and
agricultural enterprises and in religious, charitable, medical, or educational institutions, whether operating for profit or not,
shall have the right to self-organization and to form, join, or assist labor organizations of their own choosing for purposes of
collective bargaining. Ambulant, intermittent and itinerant workers, self-employed people, rural workers and those without
any definite employers may form labor organizations for their mutual aid and protection.
Cases:
LABOR LAWS AND SOCIAL LEGISLATION; LABOR CODE; RIGHT TO SELF ORGANIZATION; DISAFFILIATION OF A LOCAL UNION FROM
ITS MOTHER UNION IS VALID EVEN IF CERTAIN PROCEDURAL REQUIREMENTS FOR A VALID DISAFFILIATION WAS NOT COMPLIED
WITH PROVIDED THE GENERAL MEMBERSHIP OF THE LOCAL UNION RATIFIED THE DISAFFILIATION ACTION. — Anent the first
ground, we reiterate the rule that all employees enjoy the right to self-organization and to form and join labor organizations of
their own choosing for the purpose of collective bargaining. This is a fundamental right of labor and derives its existence from
the Constitution. In interpreting the protection to labor and social justice provisions of the Constitution and the labor laws, rules
regulations, we have always adopted the liberal approach which favors the exercise of labor rights. This Court is not ready to
bend this principle to yield to a mere procedural defect, to wit: failure to observe certain procedural requirements for a valid
disaffiliation. Non-compliance with the procedure on disaffiliation, being premised on purely technical right of self-organization.
We quote, with approval, the findings of herein public respondent, that: ". . . the resolution of the general membership ratifying
the disaffiliation action initiated by the Board, substantially satisfies the procedural requirements for disaffiliation. No doubt was
raised on the support of the majority of the union members on the decision to disaffiliate." This, to our mind, is clearly supported
by the evidence. ANGLO's alleged acts inimical to the interests of respondent union have not been sufficiently rebutted. It is clear
under the facts that respondent union's members have unanimously decided to disaffiliate from the mother federation and
ANGLO has nothing to offer in dispute other than the law prohibiting the disaffiliation outside the freedom period.|||

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(Alliance of Nationalist and Genuine Labor Organizations v. Samahan ng mga Manggagawang Nagkakaisa sa Manila Bay
Spinning Mills at J.P. Coats, G.R. No. 118562, [July 5, 1996], 327 PHIL 1011-1018)
LABOR AND SOCIAL LEGISLATION; EMPLOYER-EMPLOYEE RELATIONSHIP; HOW DETERMINED. — In determining the existence of
an employer-employee relationship, the elements that are generally considered are the following: (a) the selection and
engagement of the employee; (b) the payment of wages; (c) the power of dismissal; and (d) the employer's power to control the
employee with respect to the means and methods by which the work is to be accomplished. It is the so-called 'control test' that is
the most important element (Investment Planning Corp. of the Phils. v. The Social Security System, 21 SCRA 924; Mafinco Trading
Corp. v. Ople,supra, and Rosario Brothers, Inc. v. Ople, 131 SCRA 72).|||
(Bautista v. Inciong, G.R. No. 52824, [March 16, 1988], 242 PHIL 452-456)

2. Employees of Non-Profit Organizations


Cases:
"ARTICLE 244. Coverage and employees' right to self-organization. — All persons employed in commercial,
industrial and charitable, medical, or educational institutions whether operating for profit or not, shall have
the right to self-organizations of their own choosing for purposes of collective bargaining. Ambulant
intermittent and itinerant workers, self-employed people, rural workers and those without any definite
employers may form labor organizations for the purpose of enhancing and defending their interests and for
their mutual aid and protection." (emphasis supplied).
Under the aforequoted provision, there is no doubt that rank and file employees of non-profit medical institutions
(as herein petitioner) are now permitted to form, organize or join labor unions of their choice for purposes of
collective bargaining. Since private respondent had complied with the requisites provided by law for calling a
certification election (p. 15, Rollo), it was incumbent upon respondent Director to conduct such certification
election to ascertain the bargaining representative of petitioner's employees (Samahang Manggagawa Ng Pacific
Mills, Inc. vs. Noriel, 134 SCRA 152).
(FEU-Dr. Nicanor Reyes Medical Foundation v. Trajano, G.R. No. 76273, [July 31, 1987], 236 PHIL 763-768)
After deliberating on the petition and the documents annexed thereto, We find no merit in the petition. The public respondent
did not err in dismissing the petitioner's appeal in BLR Case No. A-12-389-87. This Court's decision in Victoriano vs. Elizalde Rope
Workers' Union,59 SCRA 54, upholding the right of members of the IGLESIA NI KRISTO sect not to join a labor union for being
contrary to their religious beliefs, does not bar the members of that sect from forming their own union. The public respondent
correctly observed that the "recognition of the tenets of the sect . . . should not infringe on the basic right of self-organization
granted by the constitution to workers, regardless of religious affiliation."|||
(Kapatiran sa Meat and Canning Division v. Calleja, G.R. No. 82914 (Resolution), [June 20, 1988], 245 PHIL 325-328)

3. Employees of Government Corporations


Article 244. Right of employees in the public service. Employees of government corporations established under the
Corporation Code shall have the right to organize and to bargain collectively with their respective employers. All other
employees in the civil service shall have the right to form associations for purposes not contrary to law.
4. Supervisors
Article 245. Ineligibility of managerial employees to join any labor organization; Right of Supervisory Employees. -
Managerial employees are not eligible to join, assist or form any labor organization. Supervisory employees shall not be
eligible for membership in the collective bargaining unit of the rank-and-file employees but may join, assist or form separate
collective bargaining units and/or legitimate labor organizations of their own. The rank-and-file union and the supervisors
union operating within the same establishment may join the same federation or national union.

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Article. 212. Definitions.


(m) "Managerial employee" is one who is vested with the powers or prerogatives to lay down and execute management
policies and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline employees. Supervisory employees
are those who, in the interest of the employer, effectively recommend such managerial actions if the exercise of such
authority is not merely routinary or clerical in nature but requires the use of independent judgment. All employees not
falling within any of the above definitions are considered rank-and-file employees for purposes of this Book.

Test to Determine Supervisory Status


Cases:
LABOR AND SOCIAL LEGISLATIONS; INDUSTRIAL PEACE ACT; RIGHT OF SUPERVISORS TO BARGAIN COLLECTIVELY; INSTANT CASE.
— Where petitioner failed to appeal in due course respondent court's en banc resolution upholding the right of the supervisors
and confidential employees to organize respondent association and to compel petitioner to negotiate and bargain collectively
with it, petitioner's contention that supervisors form part of management and are not considered as employees entitled to
bargain collectively is untenable.
DUAL STATUS OF SUPERVISOR. — Petitioner's argument that since supervisors form part of management, to allow them to
bargain collectively would be tantamount to management bargaining with itself may be a well-turned phrase but ignores the
dual status of a supervisor as a representative of management andas an employee. If indeed the supervisor is absolutely
undistinguishable from management, then he would be beyond removal or dismissal, for as respondent association counters
"how can management remove or dismiss itself? "
COLLECTIVE BARGAINING UNIT; IDENTITY OF INTEREST BETWEEN SUPERVISORS AND CONFIDENTIAL EMPLOYEES. — Where the
confidential employees are very few in number and are by practice and tradition identified with the supervisors in their role as
representatives of management vis-a-vis the rank and file employees, such identity of interest allows their inclusion in the
bargaining unit of supervisors-managers for purposes of collective bargaining in turn as employees in relation to the company as
their employer.
(Filoil Refinery Corp. v. Filoil Supervisory & Confidential Employees Ass'n., G.R. No. L-26736, [August 18, 1972], 150-B PHIL 408-
419)
BARGAINING UNIT; DEFINITION; POLICY OF THE LABOR CODE IN PREVENTING SUPERVISORY EMPLOYEES FROM JOINING LABOR
ORGANIZATIONS CONSISTING OF RANK AND FILE EMPLOYEES. — An appropriate bargaining unit is a group of employees of a
given employer, composed of all or less than the entire body of employees, which the collective interests of all the employees,
consistent with equity to the employer indicate to be best suited to serve reciprocal rights and duties of the parties under the
collective bargaining provisions law. In Belyca Corporation vs. Ferrer-Calleja, we defined the bargaining unit as "the legal
collectivity for collective bargaining purposes whose members have substantially mutual bargaining interests in terms and
conditions of employment as will assure to all employees their collective bargaining rights." This in mind, the Labor Code has
made it a clear statutory policy to prevent supervisory employees from joining labor organizations consisting of rank-and-file
employees as the concerns which involve members of either group are normally disparate and contradictory.
THE COMPOSITION OF ANY LABOR ORGANIZATION MAY BE INQUIRED INTO ANTERIOR TO THE GRANTING OF AN ORDER
ALLOWING A CERTIFICATION ELECTION WHENEVER THE STATUS OF THE LABOR ORGANIZATION IS CHALLENGED ON THE BASIS
OF ARTICLE 245 OF THE LABOR CODE. — Under Art. 245 of the Labor Code, a labor organization composed of both rank-and-file
and supervisory employees is no labor organization at all. It cannot, for any guise or purpose, be a legitimate labor organization.
Not being one, an organization which carries a mixture of rank-and-file and supervisory employees cannot possess any of the
rights of a legitimate labor organization, including the right to file a petition for certification election for the purpose of collective
bargaining. It becomes necessary, therefore, anterior to the granting of an order allowing a certification election, to inquire into
the composition of any labor organization whenever the status of the labor organization is challenged on the basis of Article 245
of the Labor Code.
RATIONALE BEHIND THE LABOR CODE'S EXCLUSION OF SUPERVISORS FROM UNIONS OF RANK AND FILE EMPLOYEES. — The
rationale behind the Code's exclusion of supervisors from union of rank-and-file employees while in the performance of

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supervisory functions, become the alter ego of management in the making and the implementing of key decisions at the sub-
managerial level. Certainly, it would be difficult to find unity or mutuality of interests in a bargaining unit consisting of a mixture
of rank-and-file and supervisory employees. And this is so because the fundamental test of a bargaining units' acceptability is
whether or not such a unit will best advance to all employees within the unit the proper exercise of their collective bargaining
rights. The Code itself has recognized this in preventing supervisory employees from joining unions of rank-and-file employees.
UNION MEMBERS OCCUPYING LEVEL 5 POSITIONS ARE SUPERVISORY EMPLOYEES; CASE AT BAR. — While there may be a
genuine divergence of opinion as to whether or not union members occupying Level 4 positions are supervisory employees, it is
fairly obvious, from a reading of the Labor Code's definition of the term that those occupying Level 5 positions are
unquestionably supervisory employees. Supervisory employees, as defined above are those who in the interest of the employer
effectively recommend managerial actions if the exercise of such authority is not merely routinary or clerical in nature but
require the use of independent judgment. Under the job description for level five employees, such personnel — all engineers —
having a number of personnel under them, not only oversee production of new models but also determine manpower
requirements, thereby influencing of important hiring decisions at the highest levels. This determination is neither routine nor
clerical but involves the independent assessment of factors affecting production, which in turn affect decisions to hire or transfer
workers. The use of independent judgment in making the decision to hire, fire or transfer in the identification of manpower
requirements would be greatly impaired if the employee's loyalties are torn between the interests of the union and the interests
of management. A supervisory employee occupying a level five position would therefore find it difficult to objectively identify the
exact manpower requirements dictated by production demands. This is precisely what the Labor Code, in requiring separate
unions among rank-and-file employees on one hand, and supervisory employees on the other, seeks to avoid.
(Toyota Motor Philippines Corp. v. Toyota Motor Philippines Corp. Labor Union, G.R. No. 121084, [February 19, 1997], 335 PHIL
1045-1056)
LABOR AND SOCIAL LEGISLATION; LABOR UNION; SUPERVISORS CAN BE APPROPRIATE BARGAINING UNIT; ELUCIDATED. —
Supervisors can be an appropriate bargaining unit. "[A]n appropriate bargaining unit is a group of employees of a given employer,
composed of all or less than the entire body of employees, which the collective interests of all the employees, consistent with
equity to the employer, indicate to be best suited to serve reciprocal rights and duties of the parties under the collective
bargaining provisions of law. Otherwise stated, it is a legal collectivity for collective bargaining purposes whose members have
substantially mutual bargaining interests in terms and conditions of employment as will assure to all employees their collective
bargaining rights. A unit to be appropriate must effect a grouping of employees who have substantial, mutual interests in wages,
hours, working conditions and other subjects of collective bargaining."
CAPACITY TO FILE PETITION FOR CERTIFICATION ELECTION. — Whether or not the respondent union can file a petition for
certification election to represent the supervisory employees of the petitioner company, this issue depends on whether the
respondent union is composed solely of supervisory employees or of both supervisory and rank-and-file employees. Article 245
of the Labor Code clearly provides that "supervisory employees shall not be eligible for membership in a labor organization of the
rank-and-file employees . . .."
SUPERVISORY EMPLOYEES; HOW DETERMINED. — To determine who are supervisory and rank-and-file employees reference has
to be made to Article 212 (m) of the Labor Code, as amended, as well as Section 1 (t), Rule I, Book V of the Omnibus Rules
Implementing the Labor Code. The test of supervisory status is whether an employee possesses authority to act in the interest of
his employer, which authority should not be merely routinary or clerical in nature but requires the use of independent judgment.
Corollarily, what determines the nature of employment is not the employee's title, but his job description.
(Dunlop Slazenger (Phils.), Inc. v. Secretary of Labor and Employment, G.R. No. 131248, [December 11, 1998], 360 PHIL 304-312)
This is precisely the situation which the law prohibits. It would create an obvious conflict of views among the members, or at
least between two (2) groups of members espousing opposing interests. The intent of the law is to avoid a situation
where supervisors would merge with the rank and file, or where the supervisors' labor organization would represent conflicting
interests, especially where, as in the case at bar, the supervisors will be commingling with those employees whom they directly
supervise in their own bargaining unit. Members of the supervisory union might refuse to carry out disciplinary measures against
their co-member rank and file employees. 10
Supervisors have the right to form their own union or labor organization. What the law prohibits is a union whose membership
comprises of supervisors merging with the rank and file employees because this is where conflict of interests may arise in the

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areas of discipline, collective bargaining and strikes. 11 The professional/technical employees of petitioner therefore may join the
existing rank and file union, or form a union separate and distinct from the existing union organized by the rank and file
employees of the same company.
As to the confidential employees of the petitioner, the latter has not shown any proof or compelling reason to exclude them from
joining respondent PMPI and from participating in the certification election, unless these confidential employees are the same
professional/technical employees whom we find to be occupying rank and file positions. LibLex
(Philippine Phosphate Fertilizer Corp. v. Torres, G.R. No. 98050, [March 17, 1994])
RULE IN DETERMINING WHETHER OR NOT THE UNION MEMBERS ARE RANK & FILE EMPLOYEES. — In ruling that the members of
respondent union are rank-and-file and not managerial employees, the public respondent made the following findings: " . . . (1)
They do not have the power to lay down and execute management policies as they are given ready policies merely to execute
and standard practices to observe; 2) they do not have the power to hire, transfer, suspend, lay-off, recall, discharge, assign or
discipline employees but only to recommend for such actions as the power rests upon the personnel manager; and 3) they do
not have the power to effectively recommend any managerial actions as their recommendations have to pass through the
department manager for review, the personnel manager for attestation and the general manager/president for final actions."
TEST OF SUPERVISORY OR MANAGERIAL STATUS. — The Court had explicitly explained in the case of Franklin Baker Company of
the Philippines v. Trajano,157 SCRA 416 [1988] that: "The test of 'supervisory or managerial status' depends on whether a person
possesses authority to act in the interest of his employer in the matter specified in Article 212 (K) of the Labor Code and Section 1
(m) of its Implementing Rules and whether such authority is not merely routinary or clerical in nature, but requires the use of
independent judgment. Thus, where such recommendatory powers as in the case at bar, are subject to evaluation, review and
final action by the department heads and other higher executives of the company, the same, although present, are not effective
and not an exercise of independent judgment as required by law (National Warehousing Corp. v. CIR, 7 SCRA 602-603 [1963])."
The public respondent, in its factual findings, found that the supervisory employees sought to be represented by the respondent
union are not involved in policy-making and their recommendatory powers are not even instantly effective since the same are
still subject to review by at least three managerial heads (department manager, personnel manager and general manager) before
final action can be taken. Hence, it is evidently settled that the said employees do not possess a managerial status. The fact that
their work designations are either managers or supervisors is of no moment considering that it is the nature of their functions
and not the said nomenclatures or titles of their jobs which determines their statuses (see Engineering Equipment, Inc. v.
National Labor Relations Commission, 133 SCRA 752 [1984] citing National Waterworks and Sewerage Authority v. NWSA
Consolidated Unions, 11 SCRA 766 [1964]).
(Pagkakaisa ng mga Manggagawa sa Triumph International v. Ferrer-Calleja, G.R. No. 85915, [January 17, 1990], 260 PHIL 125-
135)
LABOR AND SOCIAL LEGISLATION; LABOR CODE; LABOR RELATIONS; MANAGERIAL EMPLOYEES; CONSTRUED. — In United Pepsi-
Cola Supervisory Union (UPSU) v. Laguesma (288 SCRA 15 [1998]) the Court had occasion to elucidate on the term "managerial
employees." Managerial employees are ranked as Top Managers, Middle Managers and First Line Managers. Top and Middle
Managers have the authority to devise, implement and control strategic and operational policies while the task of First-Line
Managers is simply to ensure that such policies are carried out by the rank-and-file employees of an organization. Under this
distinction, "managerial employees" therefore fall in two (2) categories, namely, the "managers" per se composed of Top and
Middle Managers, and the "supervisors" composed of First-Line Managers. Thus, the mere fact that an employee is designated
"manager" does not ipso facto make him one. Designation should be reconciled with the actual job description of the employee,
for it is the job description that determines the nature of employment.|||
(Paper Industries Corp. of the Phil. v. Laguesma, G.R. No. 101738, [April 12, 2000], 386 PHIL 498-507)

5. Aliens
Article. 269. Prohibition against aliens; exceptions. - All aliens, natural or juridical, as well as foreign organizations are
strictly prohibited from engaging directly or indirectly in all forms of trade union activities without prejudice to normal
contacts between Philippine labor unions and recognized international labor centers: Provided, however, That aliens working
in the country with valid permits issued by the Department of Labor and Employment, may exercise the right to self-

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organization and join or assist labor organizations of their own choosing for purposes of collective bargaining: Provided,
further, That said aliens are nationals of a country which grants the same or similar rights to Filipino workers.

6. Security Guards Organic to Establishment


Cases:
Implications of the Lerum Proposal
In sum, Lerum's proposal to amend Art. III, §8 of the draft Constitution by including labor unions in the guarantee of
organizational right should be taken in the context of statements that his aim was the removal of the statutory ban against
security guards and supervisory employees joining labor organizations. The approval by the Constitutional Commission of his
proposal can only mean, therefore, that the Commission intended the absolute right to organize of government workers,
supervisory employees, and security guards to be constitutionally guaranteed. By implication, no similar absolute constitutional
right to organize for labor purposes should be deemed to have been granted to top-level and middle managers. As to them the
right of self-organization may be regulated and even abridged conformably to Art. III, §8.
(United Pepsi-Cola Supervisory Union v. Laguesma, G.R. No. 122226, [March 25, 1998], 351 PHIL 244-310)

D. WORKERS WITH NO RIGHT OF SELF-ORGANIZATION

1. Managerial and Confidential Employees


Article 245. Ineligibility of managerial employees to join any labor organization; Right of Supervisory Employees. -
Managerial employees are not eligible to join, assist or form any labor organization. Supervisory employees shall not be
eligible for membership in the collective bargaining unit of the rank-and-file employees but may join, assist or form separate
collective bargaining units and/or legitimate labor organizations of their own. The rank-and-file union and the supervisors
union operating within the same establishment may join the same federation or national union.
ART. 82. Coverage. - The provisions of this Title shall apply to employees in all establishments and undertakings whether for
profit or not, but not to government employees, managerial employees, field personnel, members of the family of the
employer who are dependent on him for support, domestic helpers, persons in the personal service of another, and workers
who are paid by results as determined by the Secretary of Labor in appropriate regulations.
As used herein, "managerial employees" refer to those whose primary duty consists of the management of the
establishment in which they are employed or of a department or subdivision thereof, and to other officers or members of
the managerial staff.
XXXX
Cases:
LABOR LAW; LABOR RELATIONS; CLASSIFICATION OF EMPLOYEES; MANAGERIAL EMPLOYEE; DEFINED. — As defined in the Labor
Code and as we have held in the case of Franklin Baker Company of the Phils. v. Trajano, (157 SCRA 416, 421-423, [1988]): "A
managerial employee is defined as one who is vested with powers or prerogatives to lay down and execute management policies
and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline employees, or to effectively recommend such
managerial actions. (Reynolds Phil. Corp. v. Eslava, 137 SCRA [1985], citing Section 212 (K), Labor Code." . . . "The test of
'supervisory' or 'managerial status' depends on whether a person possesses authority to act in the interest of his employer in the
matter specified in Article 212 (k) of the Labor Code and Section 1 (m) of its Implementing Rules and whether such authority is
not merely routinary or clerical in nature, but requires the use of independent judgment. Thus, where such recommendatory
powers as in the case at bar, are subject to evaluation, review and final action by the department heads and other higher
executives of the company, the same, although present, are not effective and not an exercise of independent judgment as
required by law (National Warehousing Corp. v. CIR, 7 SCRA 602-603 [1963])." "Furthermore, in line with the ruling of this Court,

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subject employees are not managerial employees because as borne by the records, they do not participate in policy making but
are given ready policies to execute and standard practices to observe, thus having little freedom of action (National Waterworks
and Sewerage Authority v. NWSA Consolidated, L-18988, 11 SCRA 766 [1964]).
SUPERVISORS BY THE NATURE OF THEIR JOB, NOT MANAGERIAL EMPLOYEES IN CASE AT BAR. — The petitioner's motion for
reconsideration before the public respondent outlined the job description of Supervisors. In the category of Supervisory II, the
"General Summary" provides: "GENERAL SUMMARY : "Assists the Foreman in the effective dispatching/distribution of manpower
and equipment to carry out approved work." (p. 30, Rollo) while the first duty enumerated in the position of Supervisor III states:
"1. Executes and coordinates work plans emanating from his supervisors." (p. 32, Rollo) Thus, it is clear from the above provisions
that the functions of the questioned positions are not managerial in nature because they only execute approved and established
policies leaving little or no discretion at all whether to implement the said policies or not. The respondent Director, therefore, did
not commit grave abuse of discretion in dismissing the petitioner's appeal from the Med-Arbiter's Order to open and count the
challenged ballots in denying the petitioner's motion for reconsideration and in certifying the respondent Union as the sole and
exclusive bargaining representative of the rank-and-file employees of respondent Apex.
CONFIDENTIAL EMPLOYEES; MERE DESIGNATION AS SUCH, DOES NOT MAKE THEM MANAGERIAL EMPLOYEES. — As regards the
employees in the confidential payroll, the petitioner has not shown that the nature of their jobs is classified as managerial except
for its allegation that they are considered by management as occupying managerial positions and highly confidential. As such
they are deemed not to be managerial employees.
(Southern Phil. Federation of Labor v. Calleja, G.R. No. 80882, [April 24, 1989], 254 PHIL 684-693)
LABOR AND SOCIAL LEGISLATION; LABOR CODE; EMPLOYMENT; PRINCIPAL GROUPS OF EMPLOYEES. — The Labor Code
recognizes two (2) principal groups of employees, namely, the managerial and the rank and file groups. Thus, Art. 212 (k) of the
Code provides: "(k) 'Managerial employee' is one who is vested with powers or prerogatives to lay down and execute
management policies and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline employees, or to effectively
recommend such managerial actions. All employees not falling within this definition are considered rank and file employees for
purposes of this Book."
EMPLOYEES PERFORMING MANAGERIAL FUNCTIONS, DISQUALIFIED FROM BEING MEMBERS OF A LABOR ORGANIZATION. — In
implementation of Article 212 (k) of the Labor Code, Section 11 of of Rule II, Book V of the Omnibus Rules implementing the
Labor Code did away with existing supervisors' unions classifying the members either as managerial or rank and file employees
depending on the work they perform. If they discharge managerial functions, supervisors are prohibited from forming or joining
any labor organization. If they do not perform managerial work, they may join the rank and file union and if none exists, they
may form one such rank and file organization. (Bulletin Publishing Corp. v. Sanchez, 144 SCRA 628 [1986]).
(Philtranco Service Enterprises v. Bureau of Labor Relations, G.R. No. 85343, [June 28, 1989], 256 PHIL 136-145)
MANAGERIAL EMPLOYEES; DISQUALIFIED FROM BARGAINING BY THE NATURE AND FUNCTIONS OF POSITION. — The signatories
to the petition for certification election are the very type of employees by the nature of their positions and functions which We
have decreed as disqualified from bargaining with management in case of Bulletin Publishing Co. Inc. vs. Hon. Augusto Sanchez,
etc. (144 SCRA 628) reiterating herein the rationale for such ruling as follows: if these managerial employees would belong to or
be affiliated with a Union, the latter might not be assured of their loyalty to the Union in view of evident conflict of interests or
that the Union can be company-dominated with the presence of managerial employees in Union membership.
DEFINITION. — A managerial employee is defined under Art. 212 (k) of the new Labor Code as "one who is vested with powers or
prerogatives to lay down and execute management policies and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or
discipline employees, or to effectively recommend such managerial actions. All employees not falling within this definitions are
considered rank-and-file employees for purposes of this book."
CONFIDENTIAL EMPLOYEES ARE LIKEWISE DISQUALIFIED. — This rationale holds true also for confidential employees such as
accounting personnel, radio and telegraph operators, who having access to confidential information, may become the source of
undue advantage. Said employee(s) may act as a spy or spies of either party to a collective bargaining agreement. This is specially
true in the present case where the petitioning Union is already the bargaining agent of the rank-and-file employees in the
establishment. To allow the confidential employees to join the existing Union of the rank-and-file would be in violation of the

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terms of the Collective Bargaining Agreement wherein this kind of employees by the nature of their functions/positions are
expressly excluded.
COMPANY FOREMEN ARE ALSO DISQUALIFIED. — As to the company foremen, while in the performance of supervisory
functions, they may be the extension or alter ego of the management. Adversely, the foremen, by their actuation, may influence
the workers under their supervision to engage in slow down commercial activities or similar activities detrimental to the policy,
interest or business objectives of the company or corporation, hence they also cannot join.
(Golden Farms, Inc. v. Ferrer-Calleja, G.R. No. 78755, [July 19, 1989], 256 PHIL 903-909)
LABOR AND SOCIAL LEGISLATION; MANAGERIAL EMPLOYEES; DISTINGUISHED FROM SUPERVISORY AND RANK-AND-FILE
EMPLOYEES. — The applicable law governing the proper composition of a bargaining unit is Article 245 of the Labor Code, as
amended. Article 212(m) of the same Code, as well as Book V, Rule 1, Section 1(o) of the Omnibus Rules Implementing the
Labor Code, as amended by the Rules and Regulations Implementing R.A. 6715, differentiate managerial, supervisory, and
rank-and-file employees, thus: "'Managerial Employee' is one who is vested with powers or prerogatives to lay down and
execute management policies and/or to hire, transfer, suspend, layoff, recall, discharge, assign or discipline employees.
Supervisory employees are those who, in the interest of the employer, effectively recommend such managerial actions if the
exercise of such authority is not merely routinary or clerical in nature but requires the use of independent judgment. All
employees not falling within any of the above definitions are considered rank-and-file employees for purposes of the Book."
TEST FOR DETERMINING THEREOF. — This Court has ruled on numerous occasions that the test of supervisory or managerial
status is whether an employee possesses authority to act in the interest of his employer, which authority is not merely
routinary or clerical in nature but requires use of independent judgment. What governs the determination of the nature of
employment is not the employee's title, but his job description. If the nature of the employee's job does not fall under the
definition of "managerial" or "supervisory" in the Labor Code, he is eligible to be a member of the rank-and-file bargaining unit.
APPLICATION IN CASE OF FOREMEN. — Foremen are chief and often especially-trained workmen who work with and
commonly are in charge of a group of employees in an industrial plant or in construction work. They are the persons
designated by the employer-management to direct the work of employees, and to superintend and oversee them. They are
representatives of the employer-management with authority over particular groups of workers, processes, operations, or
sections of a plant or an entire organization. In the modern industrial plant, they are at once a link in the chain of command
and the bridge between management and labor. In the performance of their work, foremen definitely use their independent
judgment and are empowered to make recommendations for managerial action with respect to those employees under their
control. Foremen fall squarely under the category of supervisory employees, and cannot be part of rank-and file unions.
LEGAL SECRETARIES, CONSIDERED CONFIDENTIAL EMPLOYEES. — Upon the other hand, legal secretaries are neither managers
nor supervisors. Their work is basically routinary and clerical. However, they should be differentiated from rank-and-file
employees because they are tasked with, among others, the typing of legal documents, memoranda and correspondence, the
keeping of records and files, the giving of an receiving notices, and such other duties as required by the legal personnel of the
corporation. Legal secretaries therefore fall under the category of confidential employees. Thus, to them applies our holding in
the case of Philips Industrial Development, Inc. v. NLRC, 210 SCRA 339 (1992), that: ". . . By the very nature of their functions,
they assist and act in a confidential capacity to, or have access to confidential matters of, persons who exercise managerial
functions in the field of labor relations. As such, the rationale behind the ineligibility of managerial employees to form, assist or
join a labor union equally applies to them. "In Bulletin Publishing Co., Inc. vs. Hon. Augusto Sanchez, this Court elaborated on
this rationale, thus: '. . . The rationale for this inhibition has been stated to be, because if these managerial employees would
belong to or be affiliated with a Union, the latter might not be assured of their loyalty to the Union in view of evident conflict
of interests. The Union can also become company-dominated with the presence of managerial employees in Union
membership.' "In Golden Farms, Inc. vs. Ferrer-Calleja, (210 SCRA 471 [1989]), this Court explicitly made this rationale
applicable to confidential employees: 'This rationale holds true also for confidential employees . . ., who having access to
confidential information, may become the source of undue advantage. Said employee(s) may act as a spy or spies of either
party to a collective bargaining agreement. . . .'"
TIMEKEEPER AND ASSISTANT TIMEKEEPER, NOT INCLUDED. — As for the timekeeper and assistant timekeeper, it is clear from
petitioner's own pleadings that they are neither managerial nor supervisory employees. They are merely tasked to report those
who commit infractions against company rules and regulations. This reportorial function is routinary and clerical. They do not

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determine the fate of those who violate company policy rules and regulations. It follows that they cannot be excluded from the
subject bargaining unit.
(Pier 8 Arrastre & Stevedoring Services, Inc. v. Roldan-Confesor, G.R. No. 110854, [February 13, 1995], 311 PHIL 311-331)
LABOR AND SOCIAL LEGISLATION; LABOR CODE; LABOR RELATIONS; CONFIDENTIAL EMPLOYEES, DEFINED. — Confidential
employees are those who (1) assist or act in a confidential capacity, (2) to persons who formulate, determine, and effectuate
management policies in the field of labor relations. The two criteria are cumulative, and both must be met if an employee is to be
considered a confidential employee — that is, the confidential relationship must exist between the employee and his supervisor,
and the supervisor must handle the prescribed responsibilities relating to labor relations. SDTaHc
"CONFIDENTIAL EMPLOYEE RULE"; CONSTRUED. — The exclusion from bargaining units of employees who, in the normal course
of their duties, become aware of management policies relating to labor relations is a principal objective sought to be
accomplished by the "confidential employee rule." The broad rationale behind this rule is that employees should not be placed in
a position involving a potential conflict of interests. "Management should not be required to handle labor relations matters
through employees who are represented by the union with which the company is required to deal and who in the normal
performance of their duties may obtain advance information of the company's position with regard to contract negotiations, the
disposition of grievances, or other labor relations matters." An important element of the "confidential employee rule" is the
employee's need to use labor relations information. Thus, in determining the confidentiality of certain employees, a key question
frequently considered is the employees' necessary access to confidential labor relations information. "Access to information
which is regarded by the employer to be confidential from the business standpoint, such as financial information or technical
trade secrets, will not render an employee a confidential employee." As held in Westinghouse Electric Corporation v. National
Labor Relations Board, [(CA6) 398 P2d 669 (1968)] "an employee may not be excluded from appropriate bargaining unit merely
because he has access to confidential information concerning employer's internal business operations and which is not related to
the field of labor relations." It must be borne in mind that Section 3 of Article XIII of the 1987 Constitution mandates the State to
guarantee to "all" workers the right to self-organization. Hence, confidential employees who may be excluded from bargaining
unit must be strictly defined so as not to needlessly deprive many employees of their right to bargain collectively through
representatives of their choosing.
LABOR ORGANIZATION; INELIGIBILITY OF MANAGERIAL EMPLOYEES TO JOIN THEREOF; NOT APPLICABLE IN CASE AT BAR. —
There is no question that the employees of San Miguel Corporation Magnolia Poultry Products Plants of Cabuyao, San Fernando
and Otis, supervisors and exempt employees, are not vested with the powers and prerogatives to lay down and execute
management policies and/or to hire, transfer, suspend, layoff, recall, discharge or dismiss employees. They are, therefore, not
qualified to be classified as managerial employees who, under Article 245 of the Labor Code, are not eligible to join, assist or
form any labor organization. In the very same provision, they are not allowed membership in a labor organization of the rank-
and-file employees but may join, assist or form separate labor organizations of their own.
(San Miguel Corp. Supervisors and Exempt Union v. Laguesma, G.R. No. 110399, [August 15, 1997], 343 PHIL 143-155)
LABOR AND SOCIAL LEGISLATION; LABOR CODE; EMPLOYMENT; MANAGERIAL EMPLOYEES; DEFINED. — The term "manager"
generally refers to "anyone who is responsible for subordinates and other organizational resources."
CATEGORIES. — "Managerial employees may be said to fall into two distinct categories: the "managers" per se who compose the
former group described above, and the "supervisors" who form the latter group. Whether they belong to the first or the second
category, managers, vis-a-vis employers, are, likewise, employees.
ROUTE MANAGERS ARE MANAGERIAL EMPLOYEES. — In Case No. OS-MA-10-318-91, entitled Worker's Alliance Trade Union
(WATU) v. Pepsi-Cola Products, Philippines, Inc., decided on November 13, 1991, the Secretary of Labor found: As to the route
managers and accounting manager, we are convinced that they are managerial employees. Their job descriptions clearly reveal
so. On July 6, 1992, this finding was reiterated in Case No. OS-A-3-71-92, entitled In Re: Petition for Direct Certification and/or
Certification Election-Route Managers/Supervisory Employees of Pepsi-Cola Products, Phils., Inc., as follows: In the case
of Worker's Alliance Trade Union (WATU) v. Pepsi-Cola Products, Philippines, Inc. (OS-MA-A-10-318-91), 15 November 1991, we
ruled that a route manager is a managerial employee within the context of the definition of the law, and hence, ineligible to join,
form or assist a union. We have once more passed upon the logic of our Decision aforecited in the light of the issues raised in the
instant appeal, as well as the available documentary evidence on hand, and have come to the view that there is no cogent reason
to depart from our earlier holding. Route Managers are, by the very nature of their functions and the authority they wield over

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their subordinates, managerial employees. The prescription found in Art. 245 of the Labor Code, as amended therefore, clearly
applies to them.
LABOR AND SOCIAL LEGISLATION; LABOR CODE; EMPLOYMENT; MANAGERIAL EMPLOYEES; EXCLUDED FROM JOINING UNIONS.
— Before the promulgation of theLabor Code in 1974, the field of labor relations was governed by the Industrial Peace Act (R.A.
No. 875). The right of supervisors to form their own organizations was affirmed. For its part, the Supreme Court upheld in several
of its decisions the right of supervisors to organize for purposes of labor relations. However, in Caltex Filipino Managers and
Supervisors Association v. Court of Industrial Relations, the right of all managerial employees to self-organization was upheld as a
general proposition. Actually, the case involved front-line managers or supervisors only. Thus, the dictum in the Caltex case
which allowed at least for the theoretical unionization of top and middle managers by assimilating them with the supervisory
group under the broad phrase "managerial personnel" provided the lynchpin for later laws denying the right to self-organization
not only to top and middle management employees but to front line managers and supervisors as well. Following the Caltex case,
the Labor Code, promulgated in 1974 under martial law, dropped the distinction between the first and second sub-groups of
managerial employees. Instead of treating the terms "supervisor" and "manager" separately, the law lumped them together and
called them "managerial employees." The definition shows that it is actually a combination of the commonly understood
definitions of both groups of managerial employees, grammatically joined by the phrase "and/or." This general definition was
perhaps legally necessary at that time for two reasons. First, the 1974 Code denied supervisors their right to self-organize as
therefore guaranteed to them by the Industrial Peace Act. Second, it stood the dictum in the Caltex case on its head by
prohibiting all types of managers from forming unions. The explicit general prohibition was contained in the then Art. 246 of
the Labor Code. This was the law as it stood at the time the Constitutional Commission considered the draft of Article III, §8.
Finally, the question is whether the present ban against managerial employees, as embodied in Art. 245 (which superseded Art.
246) of the Labor Code, is valid. This provision is the result of the amendment of the Labor Code in 1989 by R.A. No. 6715,
otherwise known as the Herrera-Veloso law. Unlike the Industrial Peace Act or the provisions of the Labor Code which it
superseded, R.A. No. 6715 provides separate definitions of the terms "managerial" and "supervisory employees." Although the
definition of "supervisory employees" seems to have been unduly restricted to the last phrase of the definition in the Industrial
Peace Act, the legal significance given to the phrase "effectively recommends" remains the same. In fact, the distinction between
top and middle managers, who set management policy, and frontline supervisors, who are merely responsible for ensuring that
such policies are carried out by the rank-and-file, is articulated in the present definition. When read in relation to this definition
in Art. 212 (m), it will be seen that Art. 245 faithfully carries out the intent of the Constitutional Commission in framing Art. III, §8
of the fundamental law.
CONSTITUTIONAL LAW; BILL OF RIGHTS; GUARANTEE OF ORGANIZATIONAL RIGHT; NOT ABRIDGED BY BAN AGAINST
MANAGERIAL EMPLOYEES FORMING UNION. — Nor is the guarantee of organizational right in Art. III, §8 infringed by a ban
against managerial employees forming a union. The right guaranteed in Art. III, §8 infringed by a ban against managerial
employees forming a union. The right guaranteed in Art. III, §8 is subject to the condition that its exercise should be for purposes
"not contrary to law."
LABOR AND SOCIAL LEGISLATION; LABOR CODE; EMPLOYMENT; MANAGERIAL EMPLOYEES PROHIBITED FROM JOINING LABOR
UNION; RATIONALE. — In the case of Art. 245, there is a rational basis for prohibiting managerial employees from forming or
joining labor organizations. In Bulletin Publishing Co., Inc., v. Hon. Augusto Sanchez, this Court elaborated on this rationale, thus:
" . . . The rationale for this inhibition has been stated to be, because if these managerial employees would belong to or be
affiliated with a Union, the latter might not be assured of their loyalty to the Union in view of evident conflict of interests. The
Union can also become company-dominated with the presence of managerial employees in Union membership." To be sure, the
Court in Philips Industrial was dealing with the right of confidential employees to organize. But the same reason for denying them
the right to organize justifies even more the ban on managerial employees from forming unions. After all, those who qualify as
top or middle managers are executives who receive from their employers information that not only is confidential but also is not
generally available to the public, or to their competitors, or to other employees. It is hardly necessary to point out that to say
that the first sentence of Art. 245 is unconstitutional would be to contradict the decision in that case.
(United Pepsi-Cola Supervisory Union v. Laguesma, G.R. No. 122226, [March 25, 1998], 351 PHIL 244-310)
CONFIDENTIAL EMPLOYEES; WHEN DISQUALIFIED TO JOIN LABOR UNION OF RANK AND FILE EMPLOYEES; RATIONALE. — As
regards the issue of whether or not confidential employees can join the labor union of the rank and file, what was held in the
case of National Association of Trade Unions (NATU) —Republic Planters Bank Supervisors Chapter vs. Hon. R. D. Torres, et al.,

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G.R. No. 93468, December 29, 1994, applies to this case. Citing Bulletin Publishing Corporation vs. Sanchez, 144 SCRA 628,
635; Golden Farms vs. NLRC, 175 SCRA 471, and Pier 8 Arrastre and Stevedoring Services, Inc. vs. Hon. Nieves Roldan-Confessor, et
al., G.R. No. 110854, February 14, 1995, the Court ruled: ". . . A confidential employee is one entrusted with confidence on
delicate matters, or with the custody, handling, or care and protection of the employer's property. While Art. 245 of the Labor
Code singles out managerial employee as ineligible to join, assist or form any labor organization, under the doctrine of necessary
implication, confidential employees are similarly disqualified. This doctrine states that what is implied in a statute is as much a
part thereof as that which is expressed, as elucidated in several case; the latest of which is Chua vs. Civil Service
Commission where we said: No statute can be enacted that can provide all the details involved in its application. There is always
an omission that may not meet a particular situation. What is thought, at the time of the enactment, to be an all embracing
legislation maybe inadequate to provide for the unfolding events of the future. So-called gaps in the law develop as the law is
enforced One of the rules of statutory construction used to fill in the gap is the doctrine of necessary implication . . . Every
statute is understood, by implication, to contain all such provisions as may be necessary to effectuate its object and purpose, or
to make effective rights, powers, privileges or jurisdiction which it grants, including all such collateral and subsidiary
consequences as may be fairly and logically inferred from its terms. Ex necessitate legis . . . In applying the doctrine of necessary
implication, we took into consideration the rationale behind the disqualification of managerial employees expressed in Bulletin
Publishing Corporation vs. Sanchez, thus ". . . if these managerial employees would belong to or be affiliated with a Union, the
latter might not be assured of their loyalty to the Union in view of evident conflict of interests. The Union can also become
company — dominated with the presence of managerial employees in Union membership." Stated differently, in the collective
bargaining process, managerial employees are supposed to be on the side of the employer, to act as its representatives, and to
see to it that its interest are well protected. The employer is not assured of such protection if these employees themselves are
union members. Collective bargaining in such a situation can become one-sided. It is the same reason that impelled this Court to
consider the position of confidential employees as included in the disqualification found in Art. 245 as if the disqualification of
confidential employees were written in the provision. If confidential employees could unionize in order to bargain for advantages
for themselves, then they could be governed by their own motives rather than the interest of the employers. Moreover,
unionization of confidential employees for the purpose of collective bargaining would mean the extension of the law to persons
or individuals who are supposed to act "in the interest of" the employers. It is not farfetched that in the course of collective
bargaining, they might jeopardize that interest which they are duty bound to protect. Along the same line of reasoning we held
in Golden Farms, Inc. vs. Ferrer-Calleja reiterated in Philips Industrial Development, Inc., NLRC, that "confidential employees such
as accounting personnel, radio and telegraph operators who, having access to confidential information, may become the source
of undue advantage. Said employee(s) may act as spy or spies of either party to a collective bargaining agreement." cTEICD
MEMBERSHIP IS DETERMINED BY THE NATURE OF FUNCTIONS AND NOT BY THE NOMENCLATURE OF THE JOB GIVEN. —
Designation should be reconciled with the actual job description of subject employees. A careful scrutiny of their job description
indicates that they don't lay down company policies. Theirs is not a final determination of the company policies since they have
to report to their respective superior. The mere fact that an employee is designated manager does not necessarily make him one.
Otherwise, there would be an absurd situation where one can be given the title just to be deprived of the right to be a member
of a union. In the case of National Steel Corporation vs. Laguesma, G.R. No. 103743, January 29, 1996, it was stressed that: "What
is essential is the nature of the employee's function and not the nomenclature or title given to the job which determines whether
the employee has rank and file or managerial status, or whether he is a supervisory employee."
(Pepsi-Cola Products Philippines, Inc. v. Sec. of Labor, G.R. No. 96663, 103300, [August 10, 1999])

2. Workers/Members of Cooperatives
Cases:
COMMERCIAL LAW; COOPERATIVE; DEFINED. — Under Section 2 of P.D. No. 175, a cooperative is defined to mean "organizations
composed primarily of small producers and of consumers who voluntarily join together to form business enterprises which they
themselves own, control, and patronize."
RATIONALE. — The creation and growth of cooperative was declared as a policy of the State as a means of increasing the income
and purchasing power of the low-income sector of the population in order to attain a more equitable distribution of income.

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DIFFERS FROM ORDINARY BUSINESS. — A cooperative, therefore, is by its nature different from an ordinary business concern,
being run either by persons, partnerships, or corporations. Its owners and/or members are the ones who run and operate the
business while the others are its employees. As above stated, irrespective of the number of shares owned by each member they
are entitled to cast one vote each in deciding upon the affairs of the cooperative. Their share capital earn limited interests. They
enjoy special privileges as — exemption from income tax and sales taxes, preferential right to supply their products to State
agencies and even exemption from the minimum wages laws.
LABOR LAWS; LABOR CODE; COLLECTIVE BARGAINING; MEMBERS-EMPLOYEES OF COOPERATIVE HAVE NO RIGHT TO FORM
LABOR ORGANIZATIONS. — An employee therefore of such a cooperative who is a member and co-owner thereof cannot invoke
the right to collective bargaining for certainly an owner cannot bargain with himself or his co-owners. In the opinion of August
14, 1981 of the Solicitor General he correctly opined that employees of cooperatives who are themselves members of the
cooperative have no right to form or join labor organizations for purposes of collective bargaining for being themselves co-
owners of the cooperative.
EMPLOYEES WHO ARE NOT MEMBERS OF COOPERATIVE MAY EXERCISE RIGHTS TO FORM LABOR ORGANIZATIONS. — However,
in so far as it involves cooperatives with employees who are not members or co-owners thereof, certainly such employees are
entitled to exercise the rights of all workers to organization, collective bargaining, negotiations and others as are enshrined in
the Constitution and existing laws of the country.
(Cooperative Rural Bank of Davao City, Inc. v. Ferrer-Calleja, G.R. No. 77951, [September 26, 1988], 248 PHIL 169-179)
RIGHT OF EMPLOYEES TO SELF-ORGANIZATION; MUST BE ACCORDED WITH HIGHEST RESPECT. — The right of the employees to
self-organization is a compelling reason why their withdrawal from the cooperative must be allowed. As pointed out by CURE,
the resignation of the member-employees is an expression of their preference for union membership over that of membership in
the cooperative. The avowed policy of the State to afford full protection to labor and to promote the primacy of free collective
bargaining mandates that the employees' right to form and join unions for purpose of collective bargaining be accorded the
highest consideration.|||
(Central Negros Electric Cooperative, Inc. v. Secretary, DOLE, G.R. No. 94045, [September 13, 1991], 278 PHIL 596-605)

3. Non-Employees
Article 243. Coverage and employees right to self-organization. All persons employed in commercial, industrial and
agricultural enterprises and in religious, charitable, medical, or educational institutions, whether operating for profit or not,
shall have the right to self-organization and to form, join, or assist labor organizations of their own choosing for purposes of
collective bargaining. Ambulant, intermittent and itinerant workers, self-employed people, rural workers and those without
any definite employers may form labor organizations for their mutual aid and protection.
Cases:
LABOR AND SOCIAL LEGISLATION; LABOR CODE; EMPLOYMENT; EMPLOYER-EMPLOYEE RELATIONSHIP; ELEMENTS. — The
following elements are generally considered in the determination of the employer-employee relationship; "(1) the selection and
engagement of the employee; (2) the payment of wages; (3) the power of dismissal; and (4) the power to control the employee's
conduct — although the latter is the most important element" (Mafinco Trading Corporation v. Ople, 70 SCRA 139 [1976];
Development Bank of the Philippines v. National Labor Relations Commission, 175 SCRA 537 [1989] and other cases cited)
CONTROL TEST; MOST IMPORTANT ELEMENT; CASE AT BAR. — The last and most important element of the control test is not
satisfied by the terms and conditions of the contracts. There is nothing in the agreement which implies control by the Company
not only over the end to be achieved but also over the means and methods in achieving the end (LVN Pictures, Inc. v. Philippine
Musicians Guild, 1 SCRA 132 [1961]).
ARTICLE 280, NOT THE YARDSTICK FOR DETERMINING EXISTENCE OF EMPLOYMENT RELATIONSHIP. — Article 280 is not the
yardstick for determining the existence of an employment relationship because it merely distinguishes between two kinds of
employees, i.e., regular employees and casual employees, for purposes of determining the right of an employee to certain
benefits, to join or form a union, or to security of tenure. Article 280 does not apply where the existence of an employment
relationship is in dispute.

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(Singer Sewing Machine Co. v. Drilon, G.R. No. 91307, [January 24, 1991], 271 PHIL 282-293)

4. Fiduciary Employees
Cases:
LABOR RELATIONS; INELIGIBILITY OF MANAGERIAL EMPLOYEES TO JOIN, FORM AND ASSIST ANY LABOR ORGANIZATION;
PROHIBITION EXTENDED TO CONFIDENTIAL EMPLOYEES. — Although Article 245 of the Labor Code limits the ineligibility to join,
form and assist any labor organization to managerial employees, jurisprudence has extended this prohibition to confidential
employees or those who by reason of their positions or nature of work are required to assist or act in a fiduciary manner to
managerial employees and hence, are likewise privy to sensitive and highly confidential records.|||
(Metrolab Industries, Inc. v. Roldan-Confesor, G.R. No. 108855, [February 28, 1996], 324 PHIL 416-443)

E. PARTY PROTECTED BY RIGHT


Cases:
LABOR AND SOCIAL LEGISLATIONS; INDUSTRIAL PEACE ACT; COLLECTIVE BARGAINING CONTRACT; TERMS THEREOF CONSTITUTE
LAW BETWEEN THE PARTIES. — The terms and conditions of a collective bargaining contract constitute the law between the
parties. Those who are entitled to its benefits can invoke its provisions. In the event that an obligation therein imposed is not
fulfilled, the aggrieved party has the right to go to court for redress.
BENEFITS THEREUNDER EXTEND TO ALL WORKERS OF SAME COLLECTIVE BARGAINING UNIT. — It is a well-settled doctrine that
the benefits of a collective bargaining agreement extend to the laborers and employees in the collective bargaining unit,
including those who do not belong to the chosen collective bargaining labor organization. Any other view would be a
discrimination on which the law frowns.
REASON. — If the benefits of a collective bargaining agreement would not extend to the non-members of a chosen collective
bargaining labor union, the highly salutary purpose and objective of the collective bargaining scheme to enable labor to secure
better terms in employment condition as well as rates of pay would be frustrated insofar as non-members are concerned,
deprived as they are of participation in whatever advantages could thereby be gained. The labor union that gets the majority
vote as the exclusive bargaining representative does not act for its members alone. It represents all the employees in such
bargaining unit. It is not to be indulged in any attempt on its part to disregard the rights of non-members.
CONSTITUTIONAL LAW; POLICY OF PROTECTION OF LABOR; REASON FOR EXISTENCE OF LABOR UNIONS. — It is quite
understandable that labor unions in their campaign for membership, for acquiring ascendancy in any shop plant, or industry
would do what lies in their power to put down competing groups. The struggle is likely to be marked with bitterness, no quarter
being given or expected on the part of either side. Nevertheless, it is not to be forgotten that what is entitled to constitutional
protection is labor, or more specifically the working men and women, not labor organizations. The latter are merely the
instrumentalities through which their welfare may be promoted and fostered. That is the raison de 'etre of labor unions.|||
(Mactan Workers Union v. Aboitiz, G.R. No. L-30241, [June 30, 1972], 150-A PHIL 968-978)

F. SANCTIONS FOR VIOLATIONS OF RIGHT


Article 246. Non-abridgment of right to self-organization. It shall be unlawful for any person to restrain, coerce,
discriminate against or unduly interfere with employees and workers in their exercise of the right to self-organization. Such
right shall include the right to form, join, or assist labor organizations for the purpose of collective bargaining through
representatives of their own choosing and to engage in lawful concerted activities for the same purpose or for their mutual
aid and protection, subject to the provisions of Article 264 of this Code.
Article 248. Unfair labor practices of employers. It shall be unlawful for an employer to commit any of the following unfair
labor practice:

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a. To interfere with, restrain or coerce employees in the exercise of their right to self-organization;
b. To require as a condition of employment that a person or an employee shall not join a labor organization or shall with-
draw from one to which he belongs;
c. To contract out services or functions being performed by union members when such will interfere with, restrain or
coerce employees in the exercise of their rights to self-organization;
d. To initiate, dominate, assist or otherwise interfere with the formation or administration of any labor organization,
including the giving of financial or other support to it or its organizers or supporters;
e. To discriminate in regard to wages, hours of work and other terms and conditions of employment in order to encourage
or discourage membership in any labor organization. Nothing in this Code or in any other law shall stop the parties from
requiring membership in a recognized collective bargaining agent as a condition for employment, except those
employees who are already members of another union at the time of the signing of the collective bargaining agreement.
Employees of an appropriate bargaining unit who are not members of the recognized collective bargaining agent may be
assessed a reasonable fee equivalent to the dues and other fees paid by members of the recognized collective
bargaining agent, if such non-union members accept the benefits under the collective bargaining agreement: Provided,
that the individual authorization required under Article 242, paragraph (o) of this Code shall not apply to the non-
members of the recognized collective bargaining agent;
f. To dismiss, discharge or otherwise prejudice or discriminate against an employee for having given or being about to give
testimony under this Code;
g. To violate the duty to bargain collectively as prescribed by this Code;
h. To pay negotiation or attorney’s fees to the union or its officers or agents as part of the settlement of any issue in
collective bargaining or any other dispute; or
i. To violate a collective bargaining agreement.
The provisions of the preceding paragraph notwithstanding, only the officers and agents of corporations, associations or
partnerships who have actually participated in, authorized or ratified unfair labor practices shall be held criminally liable.
Article 249. Unfair labor practices of labor organizations. - It shall be unfair labor practice for a labor organization, its
officers, agents or representatives:
a. To restrain or coerce employees in the exercise of their right to self-organization. However, a labor organization shall
have the right to prescribe its own rules with respect to the acquisition or retention of membership;
b. To cause or attempt to cause an employer to discriminate against an employee, including discrimination against an
employee with respect to whom membership in such organization has been denied or to terminate an employee on any
ground other than the usual terms and conditions under which membership or continuation of membership is made
available to other members;
c. To violate the duty, or refuse to bargain collectively with the employer, provided it is the representative of the
employees;
d. To cause or attempt to cause an employer to pay or deliver or agree to pay or deliver any money or other things of
value, in the nature of an exaction, for services which are not performed or not to be performed, including the demand
for fee for union negotiations;
e. To ask for or accept negotiation or attorney’s fees from employers as part of the settlement of any issue in collective
bargaining or any other dispute; or
f. To violate a collective bargaining agreement.
The provisions of the preceding paragraph notwithstanding, only the officers, members of governing boards, representatives
or agents or members of labor associations or organizations who have actually participated in, authorized or ratified unfair
labor practices shall be held criminally liable.

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ART. 288. Penalties. - Except as otherwise provided in this Code, or unless the acts complained of hinge on a question of
interpretation or implementation of ambiguous provisions of an existing collective bargaining agreement, any violation of
the provisions of this Code declared to be unlawful or penal in nature shall be punished with a fine of not less than One
Thousand Pesos (P1,000.00) nor more than Ten Thousand Pesos (P10,000.00) or imprisonment of not less than three months
nor more than three years, or both such fine and imprisonment at the discretion of the court.
In addition to such penalty, any alien found guilty shall be summarily deported upon completion of service of sentence.
Any provision of law to the contrary notwithstanding, any criminal offense punished in this Code, shall be under the
concurrent jurisdiction of the Municipal or City Courts and the Courts of First Instance.
ART. 289. Who are liable when committed by other than natural person. - If the offense is committed by a corporation,
trust, firm, partnership, association or any other entity, the penalty shall be imposed upon the guilty officer or officers of
such corporation, trust, firm, partnership, association or entity.

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PART THREE – LABOR ORGANIZATIONS


A. POLICY

(b) To promote free trade unionism as an instrument for the enhancement of democracy and the promotion of social justice and
development;
(c) To foster the free and voluntary organization of a strong and united labor movement;

B. LABOR ORGANIZATIONS – UNIONS


(g) To ensure the participation of workers in decision and policy-making processes affecting their rights, duties and welfare.

1. General Definition
Cases:
This Court cannot likewise subscribe to the restrictive interpretation made by the court below of the term "labor organization,"
which Section 2(e) of R.A. 875 defines as "any union or association of employees which exists, in whole or in part, for the purpose
of collective bargaining or of dealing with employers concerning terms and conditions of employment." The absence of the
condition which the court below would attach to the statutory concept of a labor organization, as being limited to the employees
of a particular employer, is quite evident from the law. The emphasis of the Industrial Peace Act is clearly on the purposes for
which a union or association of employees is established rather than that membership therein should be limited only to the
employees of a particular employer. Trite to say, under Section 2(h) of R.A. 875 "representative" is defined as including "a
legitimate labor organization or any officer or agent of such organization, whether or not employed by the employer or employee
whom he represents." It cannot be overemphasized likewise that a labor dispute can exist "regardless of whether the disputants
stand in the proximate relation of employer and employee." (Section 2(j), R.A. 875).|||
(Air Line Pilots Ass'n, of the Philippines v. Court of Industrial Relations, G.R. No. L-33705, L-35206, [April 15, 1977])

2. Local Union
(i) "Chartered Local" refers to a labor organization in the private sector operating at the enterprise level that acquired legal
personality through registration with the Regional Office in accordance with Rule III, Section 2-E of these Rules. (As amended
by DO 40-B-03.)

3. National Union/Federation
(kk) “National Union or Federation” refers to a group of legitimate labor unions in a private establishment organized for
collective bargaining or for dealing with employers concerning terms and conditions of employment for their member unions
or for participating in the formulation of social and employment policies, standards and programs, registered with the
Bureau in accordance with Rule III, Section 2-B of these Rules.

4. Legitimate Labor Organization


(h) "Legitimate labor organization" means any labor organization duly registered with the Department of Labor and
Employment, and includes any branch or local thereof.

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DOLE Registration as Basis


Cases:
LABOR ORGANIZATION; REGISTRATION THEREOF WITH THE BUREAU OF LABOR RELATIONS THAT MAKES IT A LEGITIMATE LABOR
ORGANIZATION WITH RIGHTS AND PRIVILEGES GRANTED UNDER THE LABOR CODE. — As stated in the findings of fact in the
questioned resolution of Director Pura Ferrer-Calleja, on October 23, 1950, a group of deck officers organized the Cebu Seamen's
Association, Inc., (CSAI), a non-stock corporation and registered it with the Securities and Exchange Commission (SEC). The same
group registered the organization with the Bureau of Labor Relations (BLR) as Seamen's Association of the Philippines (SAPI). It is
the registration of the organization with the BLR and not with the SEC which made it a legitimate labor organization with rights
and privileges granted under the Labor Code.|||
(Cebu Seamen's Ass'n., Inc. v. Ferrer-Calleja, G.R. No. 83190, [August 4, 1992])
LABOR LAW; CERTIFICATION ELECTION; HOLDING THEREOF BASED ON STATUTORY POLICY. — The Court has repeatedly stressed
that the holding of a certification election is based on a statutory policy that 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]). The workers must be allowed to freely express their choice in a determination
where everything is open to their sound judgment and the possibility of fraud and misrepresentation is eliminated.
PETITION THEREOF MUST BE FILED BY LEGITIMATE LABOR ORGANIZATION. — But while Article 257 cited by the Solicitor General
directs the automatic conduct of a certification election in an unorganized establishment, it also requires that the petition for
certification election must be filed by a legitimate labor organization. Article 242 enumerates the exclusive rights of a legitimate
labor organization among which is the right to be certified as the exclusive representative of all the employees in an appropriate
collective bargaining unit for purposes of collective bargaining.
LEGITIMATE LABOR ORGANIZATION; DEFINED; LEGITIMACY ACQUIRED ONLY UPON REGISTRATION WITH THE BLR. — Article
212(h) defines a legitimate labor organization as "any labor organization duly registered with the DOLE and includes any branch
or local thereof ." Rule I, Section 1 (j), Book V of the Implementing Rules likewise defines a legitimate labor organization as "any
labor organization duly registered with the DOLE and includes any branch, local or affiliate thereof ." Ordinarily, a labor
organization acquires legitimacy only upon registration with the BLR.
APPLICATION FOR REGISTRATION; MUST BE SIGNED BY AT LEAST 20% OF EMPLOYEES IN A BARGAINING UNIT. — Section 4 of
Rule II, Book V of the Implementing Rules requires that the application should be signed by at least twenty percent (20%) of the
employees in the appropriate bargaining unit and be accompanied by a sworn statement of the applicant union that there is no
certified bargaining agent or, where there is an existing collective agreement duly submitted to the DOLE, that the application is
filed during the last sixty (60) days of the agreement.
PURPOSE OF THE LAW IN REQUIRING REGISTRATION. — The purpose of the law in prescribing the requisites under Art. 234 of
the Code must be underscored. Thus, in Philippine Association of Free Labor Unions v. Secretary of Labor, 27 SCRA 40 (1969), the
Court declared: "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 registration prescribed in paragraph (b) of said section is
not a limitation to the right of assembly or association, which may be exercised with or without said registration. The latter is
merely a condition sine qua non for the acquisition of legal personality by labor 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, 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 agents of the 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 engaged affect public interest,
which should be protected. Furthermore, the obligation to 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, considering that the
same generally solicits funds or membership, as well as oftentimes collects, on behalf of its members, huge amounts of money
due to them or to the organization."
LOCAL OR CHAPTER OF A FEDERATION; NEED NOT BE REGISTERED INDEPENDENTLY; REQUIREMENTS OTHERWISE REQUIRED FOR
UNION REGISTRATION, OMITTED; REASON; THEREFOR. — When an unregistered union becomes a branch, local or chapter of a

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federation, some of the aforementioned requirements for registration are no longer required. 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 aforementioned provisions of Section 3, Rule II of Book V of the Implementing Rules.
Thus, several requirements that are otherwise required for union registration are omitted, to wit: 1) The requirement that the
application for registration must be signed by at least 20% of the employees in the appropriate bargaining unit; 2) The
submission of officers' addresses, principal address of the labor organization, the minutes of organizational meetings and the list
of the workers who participated in such meetings; 3) The submission of the minutes of the adoption or ratification of the
constitution and by laws and the list of the members who participated in it. Undoubtedly, the intent of the law in imposing lesser
requirements in the case of a branch or local of a registered federation or national union is to encourage the affiliation of a local
union with a federation or national union in order to increase the local union's bargaining powers respecting terms and
conditions of labor.
MANDATORY REQUIREMENTS FOR SUBMISSION TO THE BLR; EFFECT OF NON-COMPLIANCE THEREWITH. — A local or chapter
therefore becomes a legitimate labor organization only upon submission of the following to the BLR: 1) A charter certificate,
within 30 days from its issuance by the labor federation or national union, and 2) The constitution and by-laws, a statement on
the set of officers, and the books of accounts all of which are certified under oath by the secretary or treasurer, as the case may
be, of such local or chapter, and attested to by its president. Absent compliance with these mandatory requirements, the local or
chapter does not become a legitimate labor organization.
RELATIONSHIP WITH THE MOTHER UNION; LOCAL UNION MUST FIRST COMPLY WITH STATUTORY REQUIREMENTS BEFORE
BEING CERTIFIED AS BARGAINING AGENT. — It is important to clarify the relationship between the mother union and the local
union. In the case of Liberty Cotton Mills Workers Union v. Liberty Cotton Mills, Inc., 66 SCRA 512 [1975]), the Court held that the
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 imposed by the constitution
and by-laws of the association. Thus, where as in this case the petition for certification election was filed by the federation which
is merely an agent; the petition is deemed to be filed by the chapter, the principal, which must be a legitimate labor organization.
The chapter cannot merely rely on the legitimate status of the mother union. The Court's conclusion should not be misconstrued
as impairing the local union's right to be certified as the 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 workers should take the lead in requiring their locals and chapters to faithfully comply with
the law and the rules instead of merely snapping union after union into their folds in a furious bid with rival federations to get
the most number of members.
UNION REGISTRATION; RATIONALE FOR CERTIFICATION AND ATTESTATION REQUIREMENTS. — In the case of union registration,
the rationale for requiring that the submitted documents and papers be certified under oath by the secretary or treasurer, as the
case may be, and attested to by the president is apparent. The 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 to all the rights and privileges granted by the law to a legitimate labor organization. The
employer naturally needs assurance that the union it is dealing with is a bona-fide organization, one which has not submitted
false statements 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 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. The
certification and attestation requirements are preventive measures against the commission of fraud. They likewise afford a
measure of protection to unsuspecting employees who may be lured into joining unscrupulous or fly-by-night unions whose sole
purpose is to control union funds or to use the union for dubious ends.
UNION AFFILIATION WITH FEDERATION; DOCUMENTARY REQUIREMENTS MUST BE COMPLIED WITH BY LOCAL OR CHAPTER. —
In the case of union affiliation with a federation, the documentary requirements are found in Rule II, Section 3(e), Book V of the
Implementing Rules. Since the "procedure governing the reporting of independently registered unions" refers to the certification
and 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 case of union affiliation. Moreover,
there is greater reason to exact compliance with the certification and attestation requirements because, as previously
mentioned, several requirements applicable to independent union registration are no longer required in the case of the

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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 commission of fraud.
(Progressive Development Corp. v. Secretary of DOLE, G.R. No. 96425, [February 4, 1992])

5. Mixed Membership
Cases:
BARGAINING UNIT; DEFINITION; POLICY OF THE LABOR CODE IN PREVENTING SUPERVISORY EMPLOYEES FROM JOINING LABOR
ORGANIZATIONS CONSISTING OF RANK AND FILE EMPLOYEES. — An appropriate bargaining unit is a group of employees of a
given employer, composed of all or less than the entire body of employees, which the collective interests of all the employees,
consistent with equity to the employer indicate to be best suited to serve reciprocal rights and duties of the parties under the
collective bargaining provisions law. In Belyca Corporation vs. Ferrer-Calleja, we defined the bargaining unit as "the legal
collectivity for collective bargaining purposes whose members have substantially mutual bargaining interests in terms and
conditions of employment as will assure to all employees their collective bargaining rights." This in mind, the Labor Code has
made it a clear statutory policy to prevent supervisory employees from joining labor organizations consisting of rank-and-file
employees as the concerns which involve members of either group are normally disparate and contradictory.
RATIONALE BEHIND THE LABOR CODE'S EXCLUSION OF SUPERVISORS FROM UNIONS OF RANK AND FILE EMPLOYEES. — The
rationale behind the Code's exclusion of supervisors from union of rank-and-file employees while in the performance of
supervisory functions, become the alter ego of management in the making and the implementing of key decisions at the sub-
managerial level. Certainly, it would be difficult to find unity or mutuality of interests in a bargaining unit consisting of a mixture
of rank-and-file and supervisory employees. And this is so because the fundamental test of a bargaining units' acceptability is
whether or not such a unit will best advance to all employees within the unit the proper exercise of their collective bargaining
rights. The Code itself has recognized this in preventing supervisory employees from joining unions of rank-and-file employees.
UNION MEMBERS OCCUPYING LEVEL 5 POSITIONS ARE SUPERVISORY EMPLOYEES; CASE AT BAR. — While there may be a
genuine divergence of opinion as to whether or not union members occupying Level 4 positions are supervisory employees, it is
fairly obvious, from a reading of the Labor Code's definition of the term that those occupying Level 5 positions are
unquestionably supervisory employees. Supervisory employees, as defined above are those who in the interest of the employer
effectively recommend managerial actions if the exercise of such authority is not merely routinary or clerical in nature but
require the use of independent judgment. Under the job description for level five employees, such personnel — all engineers —
having a number of personnel under them, not only oversee production of new models but also determine manpower
requirements, thereby influencing of important hiring decisions at the highest levels. This determination is neither routine nor
clerical but involves the independent assessment of factors affecting production, which in turn affect decisions to hire or transfer
workers. The use of independent judgment in making the decision to hire, fire or transfer in the identification of manpower
requirements would be greatly impaired if the employee's loyalties are torn between the interests of the union and the interests
of management. A supervisory employee occupying a level five position would therefore find it difficult to objectively identify the
exact manpower requirements dictated by production demands. This is precisely what the Labor Code, in requiring separate
unions among rank-and-file employees on one hand, and supervisory employees on the other, seeks to avoid.
(Toyota Motor Philippines Corp. v. Toyota Motor Philippines Corp. Labor Union, G.R. No. 121084, [February 19, 1997], 335 PHIL
1045-1056)

6. Company Union
(i) "Company union" means any labor organization whose formation, function or administration has been assisted by any act
defined as unfair labor practice by this Code.

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C. UNION RATIONALE
Cases:
CONSTITUTIONAL LAW; POLICY OF PROTECTION OF LABOR; REASON FOR EXISTENCE OF LABOR UNIONS. — It is quite
understandable that labor unions in their campaign for membership, for acquiring ascendancy in any shop plant, or industry
would do what lies in their power to put down competing groups. The struggle is likely to be marked with bitterness, no quarter
being given or expected on the part of either side. Nevertheless, it is not to be forgotten that what is entitled to constitutional
protection is labor, or more specifically the working men and women, not labor organizations. The latter are merely the
instrumentalities through which their welfare may be promoted and fostered. That is the raison de 'etre of labor unions.|||
(Mactan Workers Union v. Aboitiz, G.R. No. L-30241, [June 30, 1972], 150-A PHIL 968-978)
Nor is there anything unusual in this Court's adherence with remarkable consistency to such a basic doctrine. The obligation was
categorically imposed on the State, under the 1935 Constitution, to "afford protection to labor, especially to working women and
minors . . . ," 29 That is to carry out the purpose implicit in one of the five declared principles, namely, the promotion of social
justice "to insure the well-being and economic security of all the people . . . ," 30 It is then the individual employee, as a separate,
finite human being, with his problems and his needs, who must be attended to. He is the beneficiary of the concern thus made
manifest by the fundamental law. The present Constitution is even more explicit on the matter. The principle that the State shall
promote social justice is categorically based on the concept of insuring "the dignity, welfare, and security of all the
people." 31 Insofar as the provision on the State affording protection to labor is concerned, it is further required to "promote full
employment and equality in employment, ensure equal work opportunities regardless of sex, race, or creed, and regulate the
relations between workers and employers. The State shall assure the rights of workers to self-organization, collective bargaining,
security of tenure, and just and humane conditions of work." 32 Where does that leave a labor union, it may be asked. Correctly
understood, it is nothing but the means of assuring that such fundamental objectives would be achieved. It is the instrumentality
through which an individual laborer who is helpless as against a powerful employer may, through concerted effort and activity,
achieve the goal of economic well-being. That is the philosophy underlying the Industrial Peace Act. 33 For, rightly has it been
said that workers unorganized are weak; workers organized are strong. Necessarily then, they join labor unions. To further
increase the effectiveness of such organizations, a closed-shop has been allowed. 34 It could happen, though, that such a
stipulation which assures further weight to a labor union at the bargaining table could be utilized against minority groups or
individual members thereof. There are indications that such a deplorable situation did so manifest itself here. Respondent Court,
it would appear, was not sufficiently alert to such a danger. What is worse, it paid no heed to the controlling doctrine which is
merely a recognition of a basic fact in life, namely, that power in a collectivity could be the means of crushing opposition and
stifling the voices of those who are in dissent. The right to join others of like persuasion is indeed valuable. An individual by
himself may feel inadequate to meet the exigencies of life or even to express his personality without the right to association
being vitalized. It could happen though that whatever group may be in control of the organization may simply ignore his most-
cherished desires and treat him as if he counts for naught. The antagonism between him and the group becomes marked.
Dissatisfaction if given expression may be labeled disloyalty. In the labor field, the union under such circumstances may no longer
be a haven of refuge, but indeed as much of a potential foe as management itself. Precisely with the Anakan doctrine, such an
undesirable eventuality has been sought to be minimized, if not entirely avoided. There is no justification then, both as a matter
of precedent and as a matter of principle, for the decision reached by respondent Court.|||
(Guijarno v. Court of Industrial Relations, G.R. Nos. L-28791-93, [August 27, 1973], 152 PHIL 286-296)
EXPRESS AUTHORITY OF UNION LEADERS REQUIRED BY NATURE OF SETTLEMENT. — When it is further taken into consideration
that the judgment award was for the payment of overtime, premium and differential pay to the individual union members as
claimants and for the reinstatement of the individual union members who testified and proved their having been illegally laid-off,
which represent a personal material interest directly in favor of the individual union members, as against the lack of material
interest on the part of the union as such, the union's lack of authority to execute the settlement, in the absence of express or
specific authorization by the union members, becomes patent. The authority of the union as such, to execute a settlement of the
judgment award in favor of the individual union members, cannot be presumed but must be expressly granted.|||
(Heirs Cruz v. Court of Industrial Relations, G.R. Nos. L-23331-32, L-23361-62, [December 27, 1969])
LABOR LAW; ILLEGAL STRIKE; CASE AT BAR. — The principal question to be determined in the case at bar is whether the CIR
gravely abused its discretion in declaring the strike staged by the members of the USUP unjustified and illegal. Held: The decision

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of the CIR must be affirmed. First, it must be noted that USUP filed its Notice of Strike even before it received the Shipowner's
answer to its set of demands. It seems that regardless of whether the Shipowners would be willing to negotiate with USUP or
not, USUP was already predisposed to go on with the strike. Second, in open contravention of the August 20 covenant, USUP
completely disturbed and impaired the status quo by going on strike pending resolution of its petition for certification election.
Third, the existence of a collective bargaining agreement should have been sufficient to deter USUP from acts tending to force
the issue of union recognition Fourth, even assuming again that the purpose for which the strike was staged was valid, still the
fact remains that the means employed were far from legitimate.
TEST FOR LEGALITY OR ILLEGALITY OF STRIKE. — In cases not falling within the prohibition against strikes, the legality or illegality
of a strike depends first, upon the purpose for which it is maintained, and, second, upon the means employed in carrying it on.
Thus, if the purpose which the laborers intend to accomplish by means of a strike is trivial, unreasonable or unjust (as in the case
of the National Labor Union vs. Philippine Match Co., 70 Phil., 300), or if in carrying on the strike the strikers should commit
violence or cause injuries to persons or damage to property (as in the case of National Labor Union, Inc., vs. Court of Industrial
Relations, et al., 68 Phil., 732) the strike, although not prohibited by injunction, may be declared by the court illegal, with the
adverse consequences to the strikers (Luzon Marine Dept. Union vs. Roldan, S6 Phil., 507). Where, in carrying out the strike,
coercion, force, intimidation, violation with physical injuries, sabotage and the use of unnecessary and obscene language or
epithets were committed by the top officials and members of the union in an attempt to prevent the other willing laborers to go
to work, it was held that "a strike held under those circumstances cannot be justified in a regime of law for that would encourage
abuses and terrorism and would subvert the very purpose of the law which provides for arbitration and peaceful settlement of
labor disputes" (Liberal Labor vs. Phil. Can, 91 Phil. 72).
WHEN LABOR ORGANIZATION IS WHOLESOME. — A labor organization is wholesome if it serves its legitimate purpose of
promoting the interest of labor without unnecessary labor disputes. That is why it is given personality and recognition in
concluding collective bargaining agreements. But if it is made use of as a subterfuge, or as a means to subvert valid
commitments, it defeats its own purpose for it tends to undermine the harmonious relations between management and labor.
The situation does not deserve any approving sanction from the Court.
(United Seamen's Union of the Phils. v. Davao Shipowners Ass'n., G.R. Nos. L-18778 & L-18779, [August 31, 1967], 127 PHIL 638-
655)

D. LABOR UNION REGISTRATION AND GOVERNMENT REGULATION


1. Union Registration and Procedure
a. Requirements
Article 234. Requirements of registration. - A federation, national union or industry or trade union center or an
independent union shall acquire legal personality and shall be entitled to the rights and privileges granted by law to
legitimate labor organizations upon issuance of the certificate of registration based on the following requirements:
a. Fifty pesos (P50.00) registration fee;
b. The names of its officers, their addresses, the principal address of the labor organization, the minutes of the
organizational meetings and the list of the workers who participated in such meetings;
c. In case the applicant is an independent union, the names of all its members comprising at least twenty percent
(20%) of all the employees in the bargaining unit where it seeks to operate;
d. If the applicant union has been in existence for one or more years, copies of its annual financial reports; and
e. Four copies of the constitution and by-laws of the applicant union, minutes of its adoption or ratification, and
the list of the members who participated in it.

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Article 235. Action on application. -The Bureau shall act on all applications for registration within thirty (30) days
from filing.
All requisite documents and papers shall be certified under oath by the secretary or the treasurer of the
organization, as the case may be, and attested to by its president.
Article 237. Additional requirements for federations or national unions. - Subject to Article 238, if the applicant for
registration is a federation or a national union, it shall, in addition to the requirements of the preceding Articles,
submit the following:
a. Proof of the affiliation of at least ten (10) locals or chapters, each of which must be a duly recognized collective
bargaining agent in the establishment or industry in which it operates, supporting the registration of such
applicant federation or national union; and
b. The names and addresses of the companies where the locals or chapters operate and the list of all the
members in each company involved.
Section 2. Requirements for application. (read Codal Provision)

b. Registration Proceeding
(qq) “Registration” refers to the process of determining whether the application for registration of a union or
workers' association and collective bargaining agreement complies with the documentary requirements for
registration prescribed in Rules III, IV, and XVII of these Rules.

c. Requirements and Rationale


Cases:
LABOR LAW; CERTIFICATION ELECTION; HOLDING THEREOF BASED ON STATUTORY POLICY. — The Court has repeatedly stressed
that the holding of a certification election is based on a statutory policy that 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]). The workers must be allowed to freely express their choice in a determination
where everything is open to their sound judgment and the possibility of fraud and misrepresentation is eliminated.
PETITION THEREOF MUST BE FILED BY LEGITIMATE LABOR ORGANIZATION. — But while Article 257 cited by the Solicitor General
directs the automatic conduct of a certification election in an unorganized establishment, it also requires that the petition for
certification election must be filed by a legitimate labor organization. Article 242 enumerates the exclusive rights of a legitimate
labor organization among which is the right to be certified as the exclusive representative of all the employees in an appropriate
collective bargaining unit for purposes of collective bargaining.
LEGITIMATE LABOR ORGANIZATION; DEFINED; LEGITIMACY ACQUIRED ONLY UPON REGISTRATION WITH THE BLR. — Article
212(h) defines a legitimate labor organization as "any labor organization duly registered with the DOLE and includes any branch
or local thereof ." Rule I, Section 1 (j), Book V of the Implementing Rules likewise defines a legitimate labor organization as "any
labor organization duly registered with the DOLE and includes any branch, local or affiliate thereof ." Ordinarily, a labor
organization acquires legitimacy only upon registration with the BLR.
APPLICATION FOR REGISTRATION; MUST BE SIGNED BY AT LEAST 20% OF EMPLOYEES IN A BARGAINING UNIT. — Section 4 of
Rule II, Book V of the Implementing Rules requires that the application should be signed by at least twenty percent (20%) of the
employees in the appropriate bargaining unit and be accompanied by a sworn statement of the applicant union that there is no
certified bargaining agent or, where there is an existing collective agreement duly submitted to the DOLE, that the application is
filed during the last sixty (60) days of the agreement.
PURPOSE OF THE LAW IN REQUIRING REGISTRATION. — The purpose of the law in prescribing the requisites under Art. 234 of
the Code must be underscored. Thus, in Philippine Association of Free Labor Unions v. Secretary of Labor, 27 SCRA 40 (1969), the
Court declared: "The theory to the effect that Section 23 of Republic Act No. 875 unduly curtails the freedom of assembly and

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association guaranteed in the Bill of Rights is devoid of factual basis. The registration prescribed in paragraph (b) of said section is
not a limitation to the right of assembly or association, which may be exercised with or without said registration. The latter is
merely a condition sine qua non for the acquisition of legal personality by labor 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, 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 agents of the 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 engaged affect public interest,
which should be protected. Furthermore, the obligation to 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, considering that the
same generally solicits funds or membership, as well as oftentimes collects, on behalf of its members, huge amounts of money
due to them or to the organization."
LOCAL OR CHAPTER OF A FEDERATION; NEED NOT BE REGISTERED INDEPENDENTLY; REQUIREMENTS OTHERWISE REQUIRED FOR
UNION REGISTRATION, OMITTED; REASON; THEREFOR. — When an unregistered union becomes a branch, local or chapter of a
federation, some of the aforementioned requirements for registration are no longer required. 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 aforementioned provisions of Section 3, Rule II of Book V of the Implementing Rules.
Thus, several requirements that are otherwise required for union registration are omitted, to wit: 1) The requirement that the
application for registration must be signed by at least 20% of the employees in the appropriate bargaining unit; 2) The
submission of officers' addresses, principal address of the labor organization, the minutes of organizational meetings and the list
of the workers who participated in such meetings; 3) The submission of the minutes of the adoption or ratification of the
constitution and by laws and the list of the members who participated in it. Undoubtedly, the intent of the law in imposing lesser
requirements in the case of a branch or local of a registered federation or national union is to encourage the affiliation of a local
union with a federation or national union in order to increase the local union's bargaining powers respecting terms and
conditions of labor.
MANDATORY REQUIREMENTS FOR SUBMISSION TO THE BLR; EFFECT OF NON-COMPLIANCE THEREWITH. — A local or chapter
therefore becomes a legitimate labor organization only upon submission of the following to the BLR: 1) A charter certificate,
within 30 days from its issuance by the labor federation or national union, and 2) The constitution and by-laws, a statement on
the set of officers, and the books of accounts all of which are certified under oath by the secretary or treasurer, as the case may
be, of such local or chapter, and attested to by its president. Absent compliance with these mandatory requirements, the local or
chapter does not become a legitimate labor organization.
RELATIONSHIP WITH THE MOTHER UNION; LOCAL UNION MUST FIRST COMPLY WITH STATUTORY REQUIREMENTS BEFORE
BEING CERTIFIED AS BARGAINING AGENT. — It is important to clarify the relationship between the mother union and the local
union. In the case of Liberty Cotton Mills Workers Union v. Liberty Cotton Mills, Inc., 66 SCRA 512 [1975]), the Court held that the
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 imposed by the constitution
and by-laws of the association. Thus, where as in this case the petition for certification election was filed by the federation which
is merely an agent; the petition is deemed to be filed by the chapter, the principal, which must be a legitimate labor organization.
The chapter cannot merely rely on the legitimate status of the mother union. The Court's conclusion should not be misconstrued
as impairing the local union's right to be certified as the 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 workers should take the lead in requiring their locals and chapters to faithfully comply with
the law and the rules instead of merely snapping union after union into their folds in a furious bid with rival federations to get
the most number of members.
UNION REGISTRATION; RATIONALE FOR CERTIFICATION AND ATTESTATION REQUIREMENTS. — In the case of union registration,
the rationale for requiring that the submitted documents and papers be certified under oath by the secretary or treasurer, as the
case may be, and attested to by the president is apparent. The 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 to all the rights and privileges granted by the law to a legitimate labor organization. The
employer naturally needs assurance that the union it is dealing with is a bona-fide organization, one which has not submitted

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false statements 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 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. The
certification and attestation requirements are preventive measures against the commission of fraud. They likewise afford a
measure of protection to unsuspecting employees who may be lured into joining unscrupulous or fly-by-night unions whose sole
purpose is to control union funds or to use the union for dubious ends.
UNION AFFILIATION WITH FEDERATION; DOCUMENTARY REQUIREMENTS MUST BE COMPLIED WITH BY LOCAL OR CHAPTER. —
In the case of union affiliation with a federation, the documentary requirements are found in Rule II, Section 3(e), Book V of the
Implementing Rules. Since the "procedure governing the reporting of independently registered unions" refers to the certification
and 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 case of union affiliation. Moreover,
there is greater reason to exact compliance with the certification and attestation requirements because, as previously
mentioned, several requirements applicable to independent union registration are no longer required in the case of the
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 commission of fraud.
(Progressive Development Corp. v. Secretary of DOLE, G.R. No. 96425, [February 4, 1992])
LABOR AND SOCIAL LEGISLATION; LABOR RELATIONS; LABOR ORGANIZATION; REQUISITES TO CONSIDER AS LEGITIMATE. — We
agree with petitioner Phoenix Iron and Steel Corporation and the Solicitor General that our ruling in Progressive Development
Corporation v. Secretary of Labor and Employment, (205 SCRA 802) applies in this case, to wit: "A local or chapter . . . becomes a
legitimate labor organization only upon submission of the following to the BLR: 1) A charter certificate, within 30 days from its
issuance by the labor federation or national union, and 2) The constitution and by-laws, a statement on the set of officers, and
the books of accounts all of which are certified under oath by the secretary or treasurer, as the case may be, of such local or
chapter, and attested to by its president. Absent compliance with these mandatory requirements, the local or chapter does not
become a legitimate labor organization.
RATIONALE. — The mandatory nature of the requirement is also exhaustively explained in the same case — In the case of union
registration, the rationale for requiring that the submitted documents and papers be certified under oath by the secretary or
treasurer, as the case may be, and attested to by the president is apparent. The 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 to all the rights and privileges granted by the law to a legitimate labor
organization. The employer naturally needs assurance that the union it is dealing with is a bona fide organization, one which has
not submitted false statements or misrepresentation 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 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. The certification and attestation requirements are preventive measures against the commission of fraud. They
likewise afford a measure of protection to unsuspecting employees who may be lured into joining unscrupulous or fly-by-night
unions whose sole purpose is to control union funds or to use the union for dubious ends. In the case of union affiliation with a
federation, the documentary requirements are found in Rule II, Section 3(e), Book V of the Implementing Rules, which we again
quote as follows: '(c) 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 of accounts. For reporting purposes, the procedure governing the reporting of independently
registered unions, federations or national unions shall be observed''. Since the 'procedure governing the reporting of
independently registered unions' refers to the certification and 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 case of union affiliation. Moreover, there is greater reason to exact compliance with the certification and
attestation requirements because, as previously mentioned, several requirements applicable to independent union registration
are no longer required in the case of the 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 commission of fraud.
(Phoenix Iron and Steel Corp. v. Secretary of Labor and Employment, G.R. No. 112141, [May 16, 1995])

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LABOR AND SOCIAL LEGISLATION; LABOR CODE; LABOR UNIONS; MANDATORY DOCUMENTARY REQUIREMENTS FOR
REGISTRATION OF NEWLY ORGANIZED UNION; SAME RULE APPLIES TO NEWLY ORGANIZED UNION AFFILIATED WITH A
FEDERATION OR A CHAPTER OF SUCH FEDERATION. — The principal issue here posed is whether books of account, consisting of
ledgers, journals and other accounting books, form part of the mandatory documentation requirements for registration of a
newly organized union affiliated with a federation, or a local or chapter of such a federation, as a legitimate labor organization.
The above issue was addressed several years ago and answered in the affirmative by this Court in Progressive Development
Corporation v. Secretary, DOLE. There, the Court said: "In the case of union affiliation with a federation, the documentary
requirements are found in Rule II, Section 3(e), Book V of the Implementing Rules, which we again quote as follows: '(c) 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 of
accounts. For reporting purposes, the procedure governing the reporting of independently registered unions, federations or
national unions shall be observed.' Since the 'procedure governing the reporting of independently registered unions' refers to the
certification and 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 case of union affiliation.
Moreover, there is greater reason to exact compliance with the certification and attestation requirements because, as previously
mentioned, several requirements applicable to independent union registration are no longer required in the case of the 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 commission of fraud. A local or chapter therefore becomes a legitimate labor
organization only upon submission of the following to the BLR: 1) A chapter certificate, within 30 days from its issuance by the
labor federation or national union, and 2) The constitution and by-laws, a statement on the set of officers and the books of
accounts all of which are certified under oath by the secretary or treasurer, as the case may be, of such local or chapter, and
attested to by its president. Absent compliance with these mandatory requirements, the local or chapter does not become a
legitimate labor organization. . . ."
NON-SUBMISSION OF MANDATORY DOCUMENTARY REQUIREMENTS, GROUND WHICH EMPLOYER CAN OPPOSE PETITION FOR
CERTIFICATION ELECTION. — Non-submission of such books of account certified by and attested to by the appropriate officer is
a ground which the employer can invoke legitimately to oppose a petition for certification election filed by the local or chapter
concerned. prLL
FINANCIAL STATEMENTS ARE NOT BOOKS OF ACCOUNT. — Although the federation with which the Union is affiliated
submitted documents purporting to show that the latter had offered books of account to support its (the Union's) application
for registration as a legitimate labor organization, what had been actually submitted to the BLR by the Union was a mere
"financial statement," a generous description considering the sheet of paper in fact submitted by the Union. Books of account
are quite different in their essential nature from financial statements. In generally accepted accounting practice, the former
consist of journals, ledgers and other accounting books (which are registered with the Bureau of Internal Revenue) containing
a record of individual transactions wherein monies are received and disbursed by an establishment or entity; entries are made
on such books on a day-to-day basis (or as close thereto as is possible). Statements of accounts or financial reports, upon the
other hand, merely summarize such individual transactions as have been set out in the books of account and are usually
prepared at the end of an accounting period, commonly corresponding to the fiscal year of the establishment or entity
concerned. Statements of account and financial reports do not set out or repeat the basic data (i.e., the individual transactions)
on which they are based and are, therefore, much less informative sources of cash flow information. Books of account are kept
and handled by bookkeepers (employees) of the company or agency; financial statements may be audited statements, i.e.,
prepared by external independent auditors (certified public accountants). cdll
ABSENCE OF OPPORTUNITY TO LEVY AND COLLECT DUES OF NEWLY ORGANIZED LABOR UNION, IMMATERIAL; PRESENCE OF
SYSTEM OF ACCOUNTING INDISPENSABLE; PURPOSE. — It is immaterial that the Union, having been organized for less than a
year before its application for registration with the BLR, would have had no real opportunity to levy and collect dues and fees
from its members which need to be recorded in the books of account. Such accounting books can and must be submitted to
the BLR, even if they contain no detailed or extensive entries as yet. The point to be stressed is that the applicant local or
chapter must demonstrate to the BLR that it is entitled to registered status because it has in place a system for accounting for
members' contributions to its fund even before it actually receives dues or fees from its members. The controlling intention is
to minimize the risk of fraud and diversion in the course of the subsequent formation and growth of the Union fund.

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STATUTORY AND REGULATORY PROVISIONS DEFINING THE REQUIREMENTS OF REGISTRATION OF LEGITIMATE LABOR
ORGANIZATIONS, AN EXERCISE OF POLICE POWER. — The public respondent Undersecretary thus acted arbitrarily in
disregarding the plain terms of the Omnibus Implementing Rules (Section 3(e), Rule II, Book V, Omnibus Rules Implementing
the Labor Code), and as well the rule laid down by this Court in the Progressive Development Corporationcase. The statutory
and regulatory provisions defining the requirements of registration of legitimate labor organizations are an exercise of the
overriding police power of the State, designed for the protection of workers against potential abuse by unions and federations
of unions that recruit them. This purpose is obviously defeated if the registration requirements are relaxed arbitrarily by the
very officials supposed to administer such requirements and registered status extended to an organization not entitled to such
status, as in the case at bar. prcd
MANDATORY DOCUMENTARY REQUIREMENTS FOR REGISTRATION OF LABOR UNION NOT DISPENSED WITH BY HOLDING OF
CERTIFICATION ELECTION WHERE LABOR UNION WAS CERTIFIED AS THE SOLE BARGAINING UNIT. — The Court is not closing its
eyes to the certification election actually, if precipitately, held in this case notwithstanding the prior issuance of the temporary
restraining order of this Court. So far as the record of this case is concerned, that certification election was held in the presence
of representatives of the DOLE and presumably reflected the free and democratic will of the workers of petitioner Company.
The Court will not set aside that will, in the absence of compelling reasons to do so. Nevertheless, private respondent Union
must comply with all the requirements of registration as a legitimate labor organization before it may enjoy the fruits of its
certification election victory and before it may exercise the rights of a legitimate labor organization. Registration is a
condition sine qua non for the acquisition of legal personality by a labor organization and the exercise of the rights and
privileges granted by law to legitimate labor organizations. We hold, therefore, that private respondent Union must submit its
books of account certified under oath by its treasurer and attested to by its president before such Union may demand
recognition by the Company as exclusive bargaining agent of the members of the bargaining unit and before the Union may
exercise any of the rights pertaining to such an agent. Accordingly, private respondent Union is hereby ENJOINED from
exercising the rights and privileges of a legitimate labor organizations and duly authorized collective bargaining representative
UNTIL it shall have submitted the required books of account, duly certified and attested, with the Bureau of Labor Relations.
(Protection Technology, Inc. v. Secretary, DOLE, G.R. No. 117211 (Resolution), [March 1, 1995], 312 PHIL 121-135)
LABOR AND SOCIAL LEGISLATION; LABOR CODE; ARTICLE 212(H) THEREOF; LEGITIMATE LABOR ORGANIZATION; DEFINITION OF.
— Article 212(h) of the Labor Code defines a legitimate labor organization as "any labor organization duly registered with the
Department of Labor and Employment, and includes any branch or local thereof ."
LABOR RELATIONS; LEGITIMACY OF LABOR ORGANIZATION, WHEN ACQUIRED. — Ordinarily a labor organization attains the
status of legitimacy only upon the issuance in its name of a Certificate of Registration by the Bureau of Labor Relations pursuant
to Articles 234 and 235 of the Labor Code. . . . The foregoing procedure is not the only way by which a labor union may become
legitimate, however. When an unregistered union becomes a branch, local or chapter of a federation, some of the
aforementioned requirements for registration are no longer required. Section 3, Rule II, Book V of the Implementing Rules of the
Labor Code governs the procedure for union affiliation. . . . Paragraph (a) refers to a local or chapter of a federation which did not
undergo the rudiments of registration while paragraph (b) refers to an independently registered union which affiliated with a
federation. Implicit in the 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 aforementioned provisions of Section 3 (a) and (e), without having to be issued a Certificate of Registration in its favor by the
BLR. . . Absent compliance with these mandatory requirements, the local or chapter does not become a legitimate labor
organization. Corollarily, the satisfaction of all these requirements by the local or chapter shall vest upon it the status of
legitimacy with all its concomitant statutory privileges, one of which is the right to be certified as the exclusive representative of
all the employees in an appropriate bargaining unit.
CASE AT BENCH. — Petitioner SMFI does not dispute the fact that IBM at SMFI has complied with the second set of requirements,
i.e., constitution, by-laws, et al. What is controverted is the non-compliance with the requirement as to the charter certificate
which must be submitted to the BLR within thirty (30) days from its issuance by the labor federation. While the presence of a
charter certificate is conceded, petitioner maintains that the validity and authenticity of the same cannot yet be ascertained as it
is still not known who is the legitimate and authorized representative of the IBM Federation who may validly issue said charter
certificate in favor of its local, IBM at SMFI. According to petitioner, there are two (2) contending sets of officers of the IBM
Federation at the time the charter certificate was issued in favor of IBM at SMFI, the faction of Mr. Severino O. Meron and that of

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Mr. Edilberto B. Galvez. . . . We agree with the position of the public respondent and the Solicitor General in upholding the
legitimate status of IBM at SMFI. In addition private respondent's Comment to this petition indicates that in the election of
officers held to determine the representatives of IBM, the faction of Mr. Meron lost to the group of Mr. Edilberto Galvez, and the
latter was acknowledged as the duly elected IBM National President. Thus, the authority of Mr. Galvez to sign the charter
certificate of IBM at SMFI, as President of the IBM Federation, can no longer be successfully questioned.
CHARTER CERTIFICATE; CERTIFICATION UNDER OATH BY THE ORGANIZATION'S SECRETARY AND PRESIDENT NOT ESSENTIAL FOR
VALIDITY THEREOF; CASE AT BENCH. — Petitioner next asseverates that the Charter Certificate submitted by the private
respondent was defective in that it was not certified under oath and attested to by the organization's secretary and President.
Petitioner is grasping at straws. Under our ruling in the Progressive Development Corporationcase, what is required to be
certified under oath by the secretary or treasurer and attested to by the local's president are the "constitution and by-laws, a
statement on the set of officers, and the books of accounts" of the organization. The charter certificate issued by the mother
union need not be certified under oath by the secretary or treasurer and attested to by the local's president.
(San Miguel Foods, Inc. v. Laguesma, G.R. No. 116172, [October 10, 1996], 331 PHIL 356-377)

d. Action or Denial of Application and Remedy


Article 236. Denial of registration; appeal. - The decision of the Labor Relations Division in the regional office
denying registration may be appealed by the applicant union to the Bureau within ten (10) days from receipt of
notice thereof.
Section 5. Denial of Application/Return of Notice. - Where the documents supporting the application for
registration/notice of change of name, affiliation, merger and consolidation are incomplete or do not contain the
required certification and attestation, the Regional Office or the Bureau shall, within five (5) days from receipt of
the application/notice, notify the applicant/labor organization concerned in writing of the necessary requirements
and complete the same within thirty (30) days from receipt of notice. Where the applicant/labor organization
concerned fails to complete the requirements within the time prescribed, the application for registration shall be
denied, or the notice of change of name, affiliation, merger and consolidation returned, without prejudice to filing a
new application or notice.

Section 6. Form of Denial of Application/Return of Notice; Appeal. - The notice of the Regional Office or the
Bureau denying the application for registration/returning the notice of change of name, affiliation, merger or
consolidation shall be in writing stating in clear terms the reasons for the denial or return. The denial may be
appealed to the Bureau if denial is made by the Regional Office or to the Secretary if denial is made by the Bureau,
within ten (10) days from receipt of such notice, on the ground of grave abuse of discretion or violation of these
Rules.

Cases:
(Applicable doctrine not found)

e. Effect on Freedom of Association


Cases:
LABOR AND SOCIAL LEGISLATION; LABOR CODE; CLOSED SHOP, A VALID FORM OF UNION SECURITY; CASE AT BAR. —
Disaffiliation from a labor union is implicit in the freedom of association ordained by the Constitution. But this Court has laid
down the ruling that a closed shop is a valid form of union security, and such provision is not a restriction of the right of freedom
of association guaranteed by the Constitution. In the case at bar, it appears at an undisputed fact that on February 15,1977, the
Company and the Amigo-Employees Union-PAFLU entered into a Collective Bargaining Agreement with a union security clause

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provided for in Article XII thereof which is a reiteration of the same clause in the old CBA. The quoted stipulation for closed-shop
is clear and unequivocal and it leaves no room for doubt that the employer is bound, under the collective bargaining agreement,
to dismiss the employees, herein petitioners, for non-union membership. Petitioners became non-union members upon their
expulsion from the general membership of the Amigo Employees Union-PAFLU on March 15, 1977 pursuant to the Decision of
the PAFLU national president.|||
(Villar v. Inciong, G.R. Nos. L-50283-84, [April 20, 1983], 206 PHIL 366-387)

f. Rights of Legitimate Labor Organization


Article 242. Rights of legitimate labor organizations. A legitimate labor organization shall have the right:
a. To act as the representative of its members for the purpose of collective bargaining;
b. To be certified as the exclusive representative of all the employees in an appropriate bargaining unit for
purposes of collective bargaining;
c. To be furnished by the employer, upon written request, with its annual audited financial statements, including
the balance sheet and the profit and loss statement, within thirty (30) calendar days from the date of receipt of
the request, after the union has been duly recognized by the employer or certified as the sole and exclusive
bargaining representative of the employees in the bargaining unit, or within sixty (60) calendar days before the
expiration of the existing collective bargaining agreement, or during the collective bargaining negotiation;
d. To own property, real or personal, for the use and benefit of the labor organization and its members;
e. To sue and be sued in its registered name; and
f. To undertake all other activities designed to benefit the organization and its members, including cooperative,
housing, welfare and other projects not contrary to law.
Notwithstanding any provision of a general or special law to the contrary, the income and the properties of
legitimate labor organizations, including grants, endowments, gifts, donations and contributions they may receive
from fraternal and similar organizations, local or foreign, which are actually, directly and exclusively used for their
lawful purposes, shall be free from taxes, duties and other assessments. The exemptions provided herein may be
withdrawn only by a special law expressly repealing this provision.

g. Effect of Registration
Cases:
PROPER REMEDY FOR VIOLATIONS THEREOF IN CASE AT BENCH. — Petitioner itself even admitted the existence of an agreement
but argued that its provisions were not being implemented nor adhered to at all. Suffice it to mention that the filing of the
petition for certification election is not the panacea to this allegedly anomalous situation. Violations of collective bargaining
agreements constitute unfair labor practice as provided for under Art. 248, par. (i), of the Labor Code. In consonance thereto, Art.
261 equips petitioner with the proper and appropriate recourse . . . .
VALIDLY ENTERED INTO BY A FEDERATION WHERE CONSTITUENTS ARE ALSO THE LOCAL UNION OFFICERS; CASE AT BENCH. — It
is further argued that the CBA has no binding force since it was entered into by KAMAPI as a federation and not by the local
union. Perusal of the agreement proves the contention flawed. The signatories for KAMAPI consisted of its national president and
of the duly elected officers of the local union. Thus the fact that KAMAPI was particularly mentioned as the bargaining party
without specifying the local union cannot strip it of its authority to participate in the bargaining process. The local union
maintains its separate personality despite affiliation with a larger national federation. aisadc
LABOR UNION; CANCELLATION OF CERTIFICATE OF REGISTRATION; PROPER REMEDY THEREFOR. — Sec. 9, Rule II, Book V of
the Omnibus Rules Implementing the Labor Code requires that an appeal be filed with the Bureau, or in case of cancellation by
the Bureau, with the Secretary of Labor and Employment whose decision shall become final and no longer subject of appeal.

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(Pambansang Kapatiran ng mga Anak Pawis sa Formey Plastic National Workers Brotherhood v. Secretary of Labor, G.R. No.
111836, [February 1, 1996], 323 PHIL 116-126)
LABOR AND SOCIAL LEGISLATION; LABOR ORGANIZATION; LEGITIMACY PROVED BY CERTIFICATE OF REGISTRATION ISSUED BY
THE DEPARTMENT OF LABOR; EFFECT. — FEU-IND is a legitimate labor organization. As such, it enjoys all the rights and privileges
recognized by law. The fact that FEU-IND has been issued Certificate of Registration No. RO-400-9502-UR-003 by Regional Office
No. 14 of the Department of Labor and Employment (DOLE) is sufficient proof of its legitimacy. The presentation of the xerox
copy of the certificate of registration to support its claim of being a duly registered labor organization instead of the submission
of the original certificate is not a fatal defect and does not in any way affect its legitimate status as a labor organization conferred
by its registration with DOLE. The issuance of the certificate of registration evidently shows that FEU-IND has complied with the
requirements of Art. 234 of the Labor Code. The requirements for registration being mandatory, they are complied with before
any labor organization, association or group of unions or workers acquires legal personality and be entitled to the rights and
privileges granted by law to legitimate labor organizations.|||
(Furusawa Rubber Phil., Inc. v. Secretary of Labor and Employment, G.R. No. 121241, [December 10, 1997], 347 PHIL 293-301)

h. Effect of Non-Registration
Cases:
NON-REGISTERED LABOR ORGANIZATION ACQUIRES NO LEGAL PERSONALITY; CASE AT BAR. — The Amigo Employees Union, as
an independent, union, is not duly registered at such with the Bureau of Labor Relations. The appealed decision of OIC Leogardo
of Regional Office No. 4 states at a fact that there is no record in the Bureau of Labor Relations that the Amigo Employees Union
(Independent) is registered, and (his is not disputed by petitioners, notwithstanding their allegation that the Amigo Employees
Union is a duly registered labor organization bearing Ministry of Labor Registration Certificate No. 5290-IP dated March 27, 1967.
But the independent union organized after the "Sama- Samang Kapasiyahan" executed February 7, 1977 could not have been
registered earlier, much less March 27, 1967 under Registration Certificate No. 5290-IP. As such unregistered union, it acquires
no legal personality and is not entitled to the rights and privileges granted by law to legitimate labor organizations upon issuance
of the certificate of registration. Simply put, the Amigo Employees Union (Independent) which petitioners claim to represent, not
being a legitimate labor organization, may not validly present representation issues. Therefore, the act of petitioners cannot be
considered a legitimate exercise of their right to self-organization.|||
(Villar v. Inciong, G.R. Nos. L-50283-84, [April 20, 1983], 206 PHIL 366-387)
There is nothing in the constitution of the NATU or in the constitution of the THEU-NATU that the THEU was expressly forbidden
to disaffiliate from the federation (pp. 62, 281, Rollo). The alleged non-compliance of the local union with the provision in the
NATU Constitution requiring the service of three months notice of intention to withdraw did not produce the effect of nullifying
the disaffiliation for the following grounds: firstly, NATU was not even a legitimate labor organization, it appearing that it was not
registered at that time with the Department of Labor, and therefore did not possess and acquire, in the first place, the legal
personality to enforce its constitution and laws, much less the right and privilege under the Labor Code to organize and affiliate
chapters or locals within its group, and secondly, the act of non-compliance with the procedure on withdrawal is premised on
purely technical grounds which cannot rise above the fundamental right of self-organization.|||
(Tropical Hut Employees' Union-CGW v. Tropical Hut Food Market, Inc., G.R. No. L-43495, [January 20, 1990], 260 PHIL 181-200)
PURPOSE OF THE LAW IN REQUIRING REGISTRATION. — The purpose of the law in prescribing the requisites under Art. 234 of
the Code must be underscored. Thus, in Philippine Association of Free Labor Unions v. Secretary of Labor, 27 SCRA 40 (1969), the
Court declared: "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 registration prescribed in paragraph (b) of said section is
not a limitation to the right of assembly or association, which may be exercised with or without said registration. The latter is
merely a condition sine qua non for the acquisition of legal personality by labor 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, 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,

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although not truly accredited agents of the 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 engaged affect public interest,
which should be protected. Furthermore, the obligation to 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, considering that the
same generally solicits funds or membership, as well as oftentimes collects, on behalf of its members, huge amounts of money
due to them or to the organization."|||
(Progressive Development Corp. v. Secretary of DOLE, G.R. No. 96425, [February 4, 1992])

i. Cancellation of Union Certificate Registration


Article 238. Cancellation of registration. - The certificate of registration of any legitimate labor organization,
whether national or local, may be cancelled by the Bureau, after due hearing, only on the grounds specified in
Article 239 hereof.
Article 239. Grounds for cancellation of union registration.- The following may constitute grounds for cancellation
of union registration:
a. Misrepresentation, false statement or fraud in connection with the adoption or ratification of the constitution
and by-laws or amendments thereto, the minutes of ratification, and the list of members who took part in the
ratification;
b. Misrepresentation, false statements or fraud in connection with the election of officers, minutes of the election
of officers, and the list of voters;
c. Voluntary dissolution by the members.
Article 241. Rights and conditions of membership in a labor organization. The following are the rights and
conditions of membership in a labor organization:
(j) Every income or revenue of the organization shall be evidenced by a record showing its source, and every
expenditure of its funds shall be evidenced by a receipt from the person to whom the payment is made, which shall
state the date, place and purpose of such payment. Such record or receipt shall form part of the financial records of
the organization.
Any action involving the funds of the organization shall prescribe after three (3) years from the date of submission
of the annual financial report to the Department of Labor and Employment or from the date the same should have
been submitted as required by law, whichever comes earlier: Provided, That this provision shall apply only to a
legitimate labor organization which has submitted the financial report requirements under this Code: Provided,
further, that failure of any labor organization to comply with the periodic financial reports required by law and such
rules and regulations promulgated thereunder six (6) months after the effectivity of this Act shall automatically
result in the cancellation of union registration of such labor organization;
(g) "Cancellation Proceedings" refer to the legal process leading to the revocation of the legitimate status of a
union or workers' association.
Section 1. Where to file. - Subject to the requirements of notice and due process, the registration of any legitimate
independent labor union, chartered local and workers' association may be cancelled by the Regional Director, or in
the case of federations, national or industry unions and trade union centers, by the Bureau Director, upon the filing
of an independent complaint or petition for cancellation.
Section 2. Who may file. - Any party-in-interest may commence a petition for cancellation of registration, except in
actions involving violations of Article 241, which can only be commenced by members of the labor organization
concerned.
Section 3. Grounds for cancellation. - The following shall constitute grounds for cancellation of registration of labor
organizations:

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a. misrepresentation, false statement or fraud in connection with the adoption or ratification of the constitution
and by-laws or amendments thereto, the minutes of ratification, the list of members who took part in the
ratification of the constitution and by-laws or amendments thereto, the minutes of ratification, the list of
members who took part in the ratification;
b. failure to submit the documents mentioned in the preceding paragraph within thirty (30) days from adoption or
ratification of the constitution and by-laws or amendments thereto;
c. misrepresentation, false statements or fraud in connection with the election of officers, minutes of the election
of officers, the list of voters, failure to submit these documents together with the list of the newly elected or
appointed officers and their postal address within thirty (30) days from election;
d. failure to submit the annual financial report to the Bureau within thirty (30) days after the close of every fiscal
year and misrepresentation, false entries or fraud in the preparation of the financial report;
e. acting as a labor contractor or engaging in the "cabo" system, or otherwise engaging in any activity prohibited
by law;
f. entering into collective bargaining agreements which provide for terms and conditions of employment below
minimum standards established by law;
g. commission of any of the acts enumerated under Article 241 of the Labor Code; provided that no petition for
cancellation based on this ground may be granted unless supported by at least thirty (30%) percent of all the
members of the respondent labor organization;
h. asking for or accepting attorney's fees or negotiation fees from the employer;
i. other than for mandatory activities under the Labor Code, checking off special assessments or any other fees
without duly signed individual written authorizations of the members;
j. failure to submit list of individual members to the Bureau once a year or whenever required by the Bureau;
k. failure to comply with the requirements of registration prescribed under Rules III and IV.
Section 1. When proper. - Where a registered labor organization in the private sector failed to submit the reports
required under Rule V for five (5) consecutive years despite notices for compliance sent by the Labor Relations
Division or the Bureau, the latter may cause the institution of the administrative process for cancellation of its
registration, upon its own initiative or upon complaint filed by any party-in-interest.
Section 2. Procedure. - The Labor Relations Division of the Regional Office shall make a report of the labor
organization's non-compliance and submit the same to the Bureau for verification with its records. The Bureau shall
send by registered mail with return card to the labor organization concerned, a notice for compliance indicating the
documents it failed to submit and the corresponding period in which they were required, with notice to comply
with the said reportorial requirements and to submit proof thereof to the Bureau within ten (10) days from receipt
thereof.
Where no response is received by the Bureau within thirty (30) days from the release of the first notice, another
notice for compliance shall be made by the Bureau, with warning that failure on its part to comply with the
reportorial requirements within the time specified shall cause the continuation of the proceedings for the
administrative cancellation of its registration.
Section 3. Publication of notice of cancellation of registration. - Where no response is again received by the Bureau
within thirty (30) days from release of the second notice, the Bureau shall cause the publication of the notice of
cancellation of registration of the labor organization in two (2) newspapers of general circulation. The Bureau may
conduct an investigation within the employer's premises and at the labor organization's last known address to verify
the latter's existence.
Section 4. Cancellation of registration. - Where no response is received by the Bureau within thirty (30) days from
date of publication, or where the Bureau has verified the dissolution of the labor organization, it shall order the

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cancellation of registration of the labor organization and cause its de-listing from the roster of legitimate labor
organizations.
Section 5. Conditions for administrative cancellation of certificate of registration. - No registration of labor
organization shall be cancelled administratively by the Bureau due to non-compliance with the reportorial
requirements unless:
(a) non-compliance is for a continuous period of five (5) years;
(b) the procedures laid down in this Rule were complied with; and
(c) the labor organization concerned has not responded to any of the notices sent by the Bureau, or its notices
were returned unclaimed.
Cases:
GROSS VIOLATION MANIFEST IN CASE AT BAR. — The public respondent and his subaltern, the Director of the Bureau of Labor
Relations, should have learned their lessons when the latter's resolution dated November 16, 1989 cancelling petitioner's
registration due precisely to absence of due process was reversed by the then Secretary of Labor whose decision was, in effect,
affirmed by this Court. However, instead of taking a lesson in due process, said director — this time abetted by public respondent
— violated again the same fundamental principle. After petitioner submitted its objections to the administration of the
documentary evidence of CLASS, the BLR director should have first ruled on their admissibility. However, without ruling on said
offer and without setting the case for reception of petitioner's evidence, the said official proceeded to render judgment affirming
its earlier (but already ruled as improper) decision to cancel the registration of ADFLO. This is a gross violation of petitioner's right
to due process. The cancellation of a certificate of registration is the equivalent of snuffing out the life of a labor organization. For
without such registration, it loses — as a rule — its rights under the Labor Code. Under the circumstances, petitioner was
indisputably entitled to be heard before a judgment could be rendered cancelling its certificate of registration. In David
vs. Aguilizan, it was held that a decision rendered without any hearing is null and void.|||
(Alliance of Democratic Free Labor Organization v. Laguesma, G.R. No. 108625, [March 11, 1996], 325 PHIL 13-29)
LABOR AND SOCIAL LEGISLATION; LABOR CODE OF THE PHILIPPINES; PETITION FOR CANCELLATION OF UNION'S CERTIFICATE OF
REGISTRATION; PENDENCY NOT A BAR TO CERTIFICATION ELECTION. — The pendency of the petition for cancellation of the
registration certificate of petitioner union founded on the alleged illegal strikes staged by the leaders and members of the
intervenor union and petitioner union should not suspend the holding of a certification election because there is no order
directing such cancellation (Cf. Dairy Queen Products Company of the Phil., Inc., vs. CIR, et al., No. L-35009, Aug. 31, 1977).
VIOLATION OF THE LABOR CODE; CANCELLATION OF REGISTRATION CERTIFICATE, NOT THE ONLY RESULTANT PENALTY. — As can
be gleaned from Section 8, Role 11, Book V of the Labor Code in relation to Article 273, Chapter IV, Title VIII thereof, cancellation
of the registration certificate is not the only resultant penalty in case of any violation of the Labor Code. The penalty imposable
should be commensurate to the nature or gravity of the illegal activities conducted and to the number of members and leaders
of the union staging the illegal strike.
(National Union of Bank Employees v. Minister of Labor, G.R. No. L-53406, [December 14, 1981], 196 PHIL 441-464)
CONSTITUTIONAL LAW; PROTECTION TO LABOR; LABOR UNIONS; ENGAGING IN ILLEGAL STRIKE NOT A GROUND FOR DENIAL OR
CANCELLATION OF UNION REGISTRATION; NOSCITUR A SOCIIS AND EJUSDEM GENERIS. — Article 239 of the Labor Code of the
Philippines, as amended, and Section 6 (c) of Rule II, Book V, of the Rules and Regulations implementing the Labor Code of the
Philippines, as amended mentions as among the grounds for cancellation or denial of the application for union registration. The
following shall constitute grounds for cancellation of union registration " x x x "Acting as labor contractor or engaging in the
"cabo" system, or otherwise engaging in any activity prohibited by law. This provision should not be interpreted or construed to
include all illegal strike engaged into by any union. This is so because the phrase 'or otherwise engaging in any activity prohibited
by law' should be construed to mean such activity engaged into by a union that par takes of the nature of a labor contractor or
'cabo' system. The law does not intend to include in the said phrase illegally declared strike simply because strike per se is legal.
Also, if the law intends to include illegally declared strike, the same could have been expressly placed therein as had been
previously done in Presidential Decree No. 823.|||
(Tablante-Tungol Enterprises v. Noriel, G.R. No. L-47848 (Resolution), [August 23, 1978], 174 PHIL 214-218)

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E. INTERNATIONAL ACTIVITIES OF UNION – PROHIBITION AND REGULATION

Article. 269. Prohibition against aliens; exceptions. - All aliens, natural or juridical, as well as foreign organizations are strictly
prohibited from engaging directly or indirectly in all forms of trade union activities without prejudice to normal contacts between
Philippine labor unions and recognized international labor centers: Provided, however, That aliens working in the country with valid
permits issued by the Department of Labor and Employment, may exercise the right to self-organization and join or assist labor
organizations of their own choosing for purposes of collective bargaining: Provided, further, That said aliens are nationals of a country
which grants the same or similar rights to Filipino workers.
Article. 270. Regulation of foreign assistance. –

(a) No foreign individual, organization or entity may give any donations, grants or other forms of assistance, in cash or in kind, directly
or indirectly, to any labor organization, group of workers or any auxiliary thereof, such as cooperatives, credit unions and institutions
engaged in research, education or communication, in relation to trade union activities, without prior permission by the Secretary of
Labor.

"Trade union activities" shall mean:

1. organization, formation and administration of labor organization;


2. negotiation and administration of collective bargaining agreements;
3. all forms of concerted union action;
4. organizing, managing, or assisting union conventions, meetings, rallies, referenda, teach-ins, seminars, conferences and
institutes;
5. any form of participation or involvement in representation proceedings, representation elections, consent elections, union
elections; and
6. other activities or actions analogous to the foregoing.

(b) This prohibition shall equally apply to foreign donations, grants or other forms of assistance, in cash or in kind, given directly or
indirectly to any employer or employer’s organization to support any activity or activities affecting trade unions.
(c) The Secretary of Labor shall promulgate rules and regulations to regulate and control the giving and receiving of such donations,
grants, or other forms of assistance, including the mandatory reporting of the amounts of the donations or grants, the specific
recipients thereof, the projects or activities proposed to be supported, and their duration.

Article. 271. Applicability to farm tenants and rural workers. - The provisions of this Title pertaining to foreign organizations and
activities shall be deemed applicable likewise to all organizations of farm tenants, rural workers, and the like: Provided, That in
appropriate cases, the Secretary of Agrarian Reform shall exercise the powers and responsibilities vested by this Title in the Secretary
of Labor.

F. UNION-MEMBER RELATIONS
Article 241. Rights and conditions of membership in a labor organization. (read Codal Provisions)

Article 249. Unfair labor practices of labor organizations. - It shall be unfair labor practice for a labor organization, its officers, agents
or representatives:

a. To restrain or coerce employees in the exercise of their right to self-organization. However, a labor organization shall have
the right to prescribe its own rules with respect to the acquisition or retention of membership;
b. To cause or attempt to cause an employer to discriminate against an employee, including discrimination against an
employee with respect to whom membership in such organization has been denied or to terminate an employee on any

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ground other than the usual terms and conditions under which membership or continuation of membership is made
available to other members;
c. To violate the duty, or refuse to bargain collectively with the employer, provided it is the representative of the employees;
d. To cause or attempt to cause an employer to pay or deliver or agree to pay or deliver any money or other things of value, in
the nature of an exaction, for services which are not performed or not to be performed, including the demand for fee for
union negotiations;
e. To ask for or accept negotiation or attorney’s fees from employers as part of the settlement of any issue in collective
bargaining or any other dispute; or
f. To violate a collective bargaining agreement.

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

1. Union Constitution
Cases:
FACULTY UNION'S CONSTITUTION AND BY LAWS VIOLATED; "ELECTION" HELD VOID. — The importance of a union's constitution
and bylaws (CBL) cannot be overemphasized. They embody a covenant between a union and its members and constitute the
fundamental law governing the members' rights and obligations. As such, the union's constitution and bylaws should be upheld,
as long as they are not contrary to law, good morals or public policy. We agree with the finding of Director Bitonio and Med-
Arbiter Falconitin that the October 4, 1996 election was tainted with irregularities because of the following reasons. First, the
October 4, 1996 assembly was not called by the USTFU. It was merely a convocation of faculty clubs, as indicated in the
memorandum sent to all faculty members by Fr. Rodel Aligan, OP, the secretary general of the University of Santo Tomas. It was
not convened in accordance with the provision on general membership meetings as found in Article VIII of the USTFU's CBL.
Unquestionably, the assembly was not a union meeting. It was in fact a gathering that was called and participated in by
management and non-union members. By no legal fiat was such assembly transformed into a union activity by the participation
of some union members. Second, there was no commission on elections to oversee the election, as mandated by Sections 1 and
2 of Article IX of the USTFU's CBL. Third, the purported election was not done by secret balloting, in violation of Section 6, Article
IX of the USTFU's CBL, as well as Article 241 (c) of the Labor Code. The foregoing infirmities considered, we cannot attribute grave
abuse of discretion to Director Bitonio's finding and conclusion. In Rodriguez v. Director, Bureau of Labor Relations, we
invalidated the local union elections held at the wrong date without prior notice to members and conducted without regard for
duly prescribed ground rules. We held that the proceedings were rendered void by the lack of due process — undue haste, lack
of adequate safeguards to ensure integrity of the voting, and the absence of the notice of the dates of balloting.
ACT OF SUSPENDING THE CONSTITUTION AND BY-LAWS AN IMPLIED ADMISSION THAT THE ELECTION HELD IS INVALID;
RATIFICATION OF THE NEW COLLECTIVE BARGAINING AGREEMENT DID NOT VALIDATE THE VOID ELECTION. — We agree with the
solicitor general's observation that "the act of suspending the constitution when the questioned election was held is an implied
admission that the election held on that date [October 4, 1996] could not be considered valid under the existing USTFU
constitution . . ." The ratification of the new CBA executed between the petitioners and the University of Santo Tomas
management did not validate the void October 4, 1996 election. Ratified were the terms of the new CBA, not the issue of union
leadership — a matter that should be decided only by union members in the proper forum at the proper time and after
observance of proper procedures.
(UST Faculty Union v. Bitonio, Jr., G.R. No. 131235, [November 16, 1999], 376 PHIL 294-313)

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2. Nature of Relationship
Cases:
EXPRESS AUTHORITY OF UNION LEADERS REQUIRED BY NATURE OF SETTLEMENT. — When it is further taken into consideration
that the judgment award was for the payment of overtime, premium and differential pay to the individual union members as
claimants and for the reinstatement of the individual union members who testified and proved their having been illegally laid-off,
which represent a personal material interest directly in favor of the individual union members, as against the lack of material
interest on the part of the union as such, the union's lack of authority to execute the settlement, in the absence of express or
specific authorization by the union members, becomes patent. The authority of the union as such, to execute a settlement of the
judgment award in favor of the individual union members, cannot be presumed but must be expressly granted.
FAIR DEALING OF UNION WITH ITS MEMBERS DEMANDED. — Just as this Court has stricken down unjust exploitation of laborers
by oppressive employers, so will it strike down their unfair treatment by their own unworthy leaders. The Constitution enjoins
the State to afford protection to labor. Fair dealing is equally demanded of unions as well as of employers in their dealings with
employees. The union has been evolved as an organization of collective strength for the protection of labor against the unjust
exactions of capital, but equally important is the requirement of fair dealing between the union and its members, which is
fiduciary in nature, and arises out of two factors: "one is the degree of dependence of the individual employee on the union
organization; the other, a corollary of the first, is the comprehensive power vested in the union with respect to the individual."
CASES OF JESALVA AND DIOMELA NOT APPLICABLE. — The cases of Jesalva, et al. vs. Bautista and Diomela, et al. vs. Court of
Industrial Relations clearly have no application in the present case where the respondent court's approval of the questioned
settlement entered into by the union board of directors was without the authority of the claimants-members of the labor union
involved. In Jesalva, seventeen cases in different stages of hearing or execution before the Industrial Court were settled by a
compromise agreement, and this Court held that the three petitioners who questioned the settlement were "bound by the
actions of the Union, that is to say, a majority of the members of the union." There was no question there that the union had
acted with the authority of the union membership. No deceit or concealment or misrepresentation tainted the settlement.
Neither was the amount of the settlement denounced as unconscionable. In Diomela, the labor-management disputes were
settled amicably with the unfair labor practice charge against the employer being withdrawn, upon motion signed by the union
president and the three employees against whom the acts of unfair labor practice charged in the complaint had been allegedly
committed, to which motion the Court's prosecutor gave his conformity, and with the employer, agreeing to pay three months
separation pay to each striking employee. There was no question, therefore, of the authority of the union president to withdraw
the unfair labor practice charge, as the three employees directly affected had co-signed the withdrawal motion with him.
REAL PARTY IN INTEREST ARE THE INDIVIDUAL WORKERS. — Where collective bargaining process is not involved, and what is at
stake are back wages already earned by the individual workers by way of overtime, premium and differential pay, and final
judgment has been rendered in their favor, as in the present case, the real party in interest with direct material interest, as
against the union which has only served as a vehicle for collective action to enforce their just claims, are the individual workers
themselves. Authority of the union to waive or quitclaim all or part of the judgment award in favor of the individual workers
cannot be lightly presumed but must be expressly granted, and the employer, as judgment debtor, must deal in all good faith
with the union as the agent of the individual workers. The Court in turn should certainly verify and assure itself of the fact and
extent of the authority of the union leadership to execute any compromise or settlement of the judgment on behalf of the
individual workers who are the real judgment creditors.
(Heirs Cruz v. Court of Industrial Relations, G.R. Nos. L-23331-32, L-23361-62, [December 27, 1969])

3. Issues on Admission and Discipline


a. Admission
Cases:
LABOR LAW, VOLUNTARY ASSOCIATIONS, STATE MAY NOT COMPEL THEM TO ADMIT ANY INDIVIDUAL AS MEMBER; EXCEPTION.
— Although, generally, a state may not compel ordinary voluntary associations to admit thereto any given individual, because
membership therein may be accorded or withheld as a matter of privilege (4 Am. Jur. 462; 31 Am. Jur. 426), the rule is qualified

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in respect of labor unions holding a monopoly in the supply of labor, either in a given locality, or as regards a particular employer
with which it has a closed-shop agreement (31 Am. Jur. 432).
REASON FOR THE RULE. — The reason is that "the closed shop and the union shop cause the admission requirements of trade
unions to become affected with public interest. Likewise a closed shop, a union shop, or maintenance of membership clauses
cause the administration of discipline by unions to be affected with public interest (Labor Law Cases and Materials, Archibal Cox,
pp. 1009-1011; Williams vs. International Brotherhood of Boiler-Makers, 27 Cal. 2d. 586, 165 P. 2d. 903; James vs. Marineship
Corp., 25 Cal. 2d; 721, 155 P. 2d. 329).
UNIONS MAY NOT ARBITRARILY EXCLUDE QUALIFIED APPLICANTS FOR MEMBERSHIP. — It is well settled that such unions are not
entitled to arbitrarily exclude qualified applicants for membership, and a closed -shop provision would not justify the employer in
discharging, or a union in insisting upon the discharge of; an employee whom the union thus refuses to admit to membership,
without any reasonable ground therefor (31 Am. Jur. 432). Needless to say, if said unions may be compelled to admit new
members, who have the requisite qualifications, with more reason may the law and the courts exercise the coercive power when
the employee involved is a long standing union member who, owing to provocations of union officers, was impelled to tender his
resignation, which he forthwith withdrew or revoked. Surely, he may at least, invoke the rights of those who seek admission for
the first time, and cannot arbitrarily be denied readmission.
(Salunga v. Court of Industrial Relations, G.R. No. L-22456, [September 27, 1967], 128 PHIL 252-263)

b. Right to Discipline
Cases:
In Phil. Association of Free Labor Unions vs. Sec. of Labor, 27 SCRA 40, We had occasion to interpret Section 23 of R.A. No.
875 (Industrial Peace Act) requiring of labor unions registration by the Department of Labor in order to qualify as "legitimate
labor organization," and We said:
"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 registration prescribed in paragraph
(b) of said section 17 is not a limitation to the right of assembly or association, which may be exercised with or
without said registration. The latter is merely a condition sine qua non for the acquisition of legal personality by
labor 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, 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 agents of the union they purport to represent. Such requirement is a valid
exercise of the police power, because the activities in which labor organizations, associations and union or
workers are engaged affect public interest, which should be protected."
Simply put, the Amigo Employees Union (Independent) which petitioners claim to represent, not being a legitimate labor
organization, may not validly present representation issues. Therefore, the act of petitioners cannot be considered a legitimate
exercise of their right to self-organization. Hence, We affirm and reiterate the rationale explained in Phil. Association of Free
Labor Unions vs. Sec. of Labor case, supra, in order to protect legitimate labor and at the same time maintain discipline and
responsibility within its ranks. LexLib
(Villar v. Inciong, G.R. Nos. L-50283-84, [April 20, 1983], 206 PHIL 366-387)

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c. Due Process Rule


Cases:
It is now contended that because the decisions of both the Court of Industrial Relations and the Supreme Court do not contain
any intimation nor statement to the effect that the charges filed against Paulino Bugay which resulted in his separation from the
union were "trumped up" or fabricated but were solely based on procedural defects in the matter of his expulsion appellant
cannot ask for moral damages inasmuch as there is no showing that to effect his expulsion the officers of the union have acted in
bad faith. As a matter of fact, it is contended, he did not lose his employment as payroll clerk in the Manila Railroad Company as
a result of his expulsion, nor did he suffer any change in his status as a consequence thereof. In effect, he was not awarded any
damages by the industrial court.
It should, however, be observed that the main basis of appellant's action is his claim that because of the unfair labor practice
committed by the officers of defendant union as found by the Court of Industrial Relations and the Supreme Court he has
suffered moral damages because of the mental anguish, anxiety, social humiliation and besmirched reputation he has been
subjected among the thousands of employees of the Manila Railroad Company, which claim finds support in our new Civil Code.
Thus, Article 2217 of said Code provides as follows:
"ART. 2217. Moral damages include physical suffering, mental anguish, fright, serious anxiety, besmirched
reputation, wounded feelings, moral shock, social humiliation, and similar injury. Though incapable of
pecuniary computation, moral damages may be recovered if they are the proximate result of the defendant's
wrongful act or omission."
It is true that the decisions both of the Court of Industrial Relations and the Supreme Court do not contain any statement that
the charges preferred by the officers of the union against him which resulted in his expulsion were "trumped up" or fabricated,
or that said officers acted maliciously or in bad faith, but the fact remains that the two courts have found that his expulsion was
illegal because of the irregularities committed in his investigation. In effect, it was found that not only has he not been given an
opportunity to defend himself but his expulsion was not submitted to the different chapters of the union as required by its
constitution and by-laws. The result was that because of his expulsion he was subjected to humiliation and mental anguish with
the consequent lose of his good name and reputation. This is especially so considering that the members of the union from which
he was expelled amounted to around 20,000 more or less. It is, therefore, an error for the lower court to hold that the complaint
does not state sufficient cause of action for the relief claimed by appellant.
(Bugay v. Kapisanan ng mga Mangagawa sa Manila Railroad Co., G.R. No. L-13093, [February 28, 1962], 114 PHIL 396-401)

4. Issues on Election of Officers – Qualifications, Manner of Election, Tenure and Compensation


Article 241. Rights and conditions of membership in a labor organization. The following are the rights and conditions of
membership in a labor organization:
(c) The members shall directly elect their officers, including those of the national union or federation to which they or their
union is affiliated, by secret ballot at intervals of five (5) years. No qualification requirements for candidacy to any position
shall be imposed other than membership in good standing in subject labor organization. The secretary or any other
responsible union officer shall furnish the Secretary of Labor and Employment with a list of the newly-elected officers,
together with the appointive officers or agents who are entrusted with the handling of funds, within thirty (30) calendar days
after the election of officers or from the occurrence of any change in the list of officers of the labor organization;
(f) No person who has been convicted of a crime involving moral turpitude shall be eligible for election as a union officer or
for appointment to any position in the union;
k) The officers of any labor organization shall not be paid any compensation other than the salaries and expenses due to
their positions as specifically provided for in its constitution and by-laws, or in a written resolution duly authorized by a
majority of all the members at a general membership meeting duly called for the purpose. The minutes of the meeting and
the list of participants and ballots cast shall be subject to inspection by the Secretary of Labor or his duly authorized
representatives. Any irregularities in the approval of the resolutions shall be a ground for impeachment or expulsion from
the organization;

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Section 1. Conduct of election of union officers; procedure in the absence of provisions in the constitution and by-laws. -
In the absence of any agreement among the members or any provision in the constitution and by-laws of a labor union or
workers' association, the following guidelines may be adopted in the election of officers.
(a) within sixty (60) days before the expiration of the term of the incumbent officers, the president of the labor
organization shall constitute a committee on election to be composed of at least three (3) members who are not
running for any position in the election, provided that if there are identifiable parties within the labor organization, each
party shall have equal representation in the committee;
(b) upon constitution, the members shall elect the chairman of the committee from among themselves, and case of
disagreement, the president shall designate the chairman;
(c) within ten (10) days from its constitution, the committee shall, among others, exercise the following powers and
duties:
1) set the date, time and venue of the election;
2) prescribe the rules on the qualification and eligibility of candidates and voters;
3) prepare and post the voters' list and the list of qualified candidates;
4) accredit the authorized representatives of the contending parties;
5) supervise the actual conduct of the election and canvass the votes to ensure the sanctity of the ballot;
6) keep minutes of the proceedings;
7) be the final arbiter of all election protests;
8) proclaim the winners; and
9) prescribe such other rules as may facilitate the orderly conduct of election.
Section 2. Dispute over conduct of election of officers. - Where the terms of the officers of a labor organization have
expired and its officers failed or neglected to do so call for an election of new officers, or where the labor organization's
constitution and by-laws do not provide for the manner by which the said election can be called or conducted and the
intervention of the Department is necessary, at least thirty percent (30%) of the members of the labor organization may file
a petition for the conduct of election of their officers with the Regional Office that issued its certificate of registration or
certificate of creation of chartered local.
In the case of federations, national or industry unions and trade union centers, the petition shall be filed with the Bureau or
the Regional Office but shall be heard and resolved by the Bureau.
This rule shall also apply where a conduct of election of officers is an alternative relief or necessary consequence of a
petition for nullification of election of officers, impeachment/expulsion of officers, or such other petitions.
Section 3. Formal requirements and proceedings. - The formal requirements, processes and periods of disposition of this
petition stated in Rule XI shall be followed in the determination of the merits of the petition and appeal.
Section 4. Pre-election conference and conduct of election. - The appointment of an election officer and the procedures and
periods in the conduct of the pre-election conference and election proceedings prescribed in Rule IX shall also apply in the
conduct of a pre-election conference and election of officers in any labor organization.
Section 5. Applicability of the provisions of the labor organization's constitution and by-laws. - Where the conduct of
election of officers is ordered by the Med-Arbiter, the Bureau or Office of the Secretary, the rules and regulations governing
the filing of candidacies and conduct of election under the constitution and by-laws of the labor organization may be applied
in the implementation of the decision, or new and additional rules may be adopted as agreed upon by the parties.
The entire proceedings shall be presided by the Election Officer from the Labor Relations Division of the Regional Office or
the Bureau. He/She shall act as the COMELEC referred to in the labor organization's constitution and by-laws and obligate
himself/herself to comply with his/her mandate under the decision to be implemented and the constitution and by-laws.

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a. Voters List
Cases:
ACT OF JOINING ELECTION BY CASTING THE VOTES, A CLEAR MANIFESTATION OF JOINING THE UNION. — Considering that none
of the parties insisted on the use of the payroll period-list as voting list and considering further that the 51 remaining employees
were correctly ruled to be qualified for membership, their act of joining the election by casting their votes on May 26, 1986 after
the May 10, 1986 agreement is a clear manifestation of their intention to join the union. They must therefore be considered ipso
facto members thereof Said employees having exercised their right to unionism by joining ITM-MEA their decision is paramount.
Their names could not have been included in the list of employee submitted on April 24, 1986 to the Bureau of Labor for the
agreement to join the union was entered into only on May 10, 1986. Indeed the election was supervised by the Department of
Labor where said 56 members were allowed to vote. Private respondents never challenged their right to vote then.|||
(Tancinco v. Ferrer-Calleja, G.R. No. 78131, [January 20, 1988], 241 PHIL 203-210)

b. Disqualification of Candidate
Cases:
POLITICAL LAW; ELECTION LAWS; DISQUALIFICATION OF WINNING CANDIDATE DOES NOT ENTITLED CANDIDATE HAVING THE
SECOND HIGHEST NUMBER OF VOTES TO OFFICE. — Even if the disqualification of private respondents could be justified, the
candidates of petitioners certainly cannot be declared as the winners in the disputed election. The mere fact that they obtained
the second highest number of votes does not mean that they will thereby be considered as the elected officers if the true
winners are disqualified.|||
(Manalad v. Trajano, G.R. Nos. 72772-73, [June 28, 1989], 256 PHIL 64-72)

c. Expulsion Remedy
Cases:
LABOR AND SOCIAL LEGISLATIONS; LABOR CODE; ORDER FOR THE HOLDING OF REFERENDUM; TO DECIDE EXPULSION OR
SUSPENSION OF UNION MEMBERS; RENDERED MOOT IN THE CASE AT BAR. — By and large, the holding of the referendum
(election of officers of the labor union) in question has become moot and academic. This is in line with Our ruling in Pascual vs.
Provincial Board of Nueva Ecija, 106 Phil. 471, which We quote: "The Court should never remove a public officer for acts done
prior to his present term of office. To do otherwise would be to deprive the people of their right to elect their officers. When the
people have elected a man to office, it must be assumed that they did this with knowledge of his life and character, and that they
disregarded or forgave his faults or misconduct, if he had been guilty of any. It is not for the court, by reason of such faults or
misconduct to practically overrule the will of the people.|||
(Kapisanan ng Manggagawang Pinagyakap v. Cresenciano Trajano, G.R. No. 62306, [January 21, 1985], 219 PHIL 209-214)

d. Invalid Election
Cases:
LABOR LAW; LABOR ORGANIZATION; ELECTION OF UNION OFFICERS HELD INVALID; CASE AT BAR. — The provincial elections for
union officers were moved to a later date without prior notice to all voting members and without ground rules duly prescribed
therefor. The elections in Metro Manila were conducted under no better circumstances, were held in defiance of the temporary
restraining order issued on July 23, 1986 despite previous notice of said order to all parties concerned. Said elections must
therefor be rendered void. The claim that a heavy voter turn-out of 73%, even if true cannot purge the elections of their grave
defects. Besides, the protected right of workers to self-organization would be diluted if the election of the officers who will
govern their affairs is not fairly and honestly conducted.|||

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(Rodriguez v. Dir. Bureau of Labor Relations, G.R. Nos. 76579-82, 80504, [August 31, 1988])

5. Major Policy Matters


Article 241.
(c) The members shall directly elect their officers, including those of the national union or federation to which they or their
union is affiliated, by secret ballot at intervals of five (5) years. No qualification requirements for candidacy to any position
shall be imposed other than membership in good standing in subject labor organization. The secretary or any other
responsible union officer shall furnish the Secretary of Labor and Employment with a list of the newly-elected officers,
together with the appointive officers or agents who are entrusted with the handling of funds, within thirty (30) calendar days
after the election of officers or from the occurrence of any change in the list of officers of the labor organization;
a. Legal Counsel
Cases:
SUPREME COURT; DISBARMENT PROCEEDINGS; ATTORNEYS; INHERENT POWER OF COURTS OVER ITS OFFICERS CANNOT BE
RESTRICTED. — Likewise, Atty. Pineda should be subject to disbarment proceedings under Section 27 of Rule 138 of the Revised
Rules of Court. The Court may suspend or disbar a lawyer for any conduct on his part showing his unfitness for the confidence
and trust which characterize the attorney and client relations, and the practice of law before the courts, or showing such a lack of
personal honesty or of good moral character as to render him unworthy of public confidence (7 C.J.S. 733). It is a well-settled rule
that the statutory grounds for disbarment or suspension are not to be taken as a Imitation on the general power of the courts in
this respect. The inherent powers of the court over its officers cannot be restricted (In re Pelaez, 44 Phil. 567).
CRIMINAL LAW; PROSECUTION FOR BETRAYAL OF TRUST BY AN ATTORNEY; CRIMINAL SANCTION WITHOUT PREJUDICE TO
PROPER ADMINISTRATIVE ACTION. — Finally, Atty. Pineda could be prosecuted for betrayal of trust by an attorney under Article
209 of the Revised Penal Code. Said article provides: "Art. 209. Betrayal of trust by an attorney or solicitor. Revelation of secrets.
— In addition to the proper administrative action, the penalty of prision correccional in its minimum period, or a fine ranging
from 200 to 1,000 pesos, or both, shall be imposed upon any attorney-at-law or solicitor (procurador judicial) who, by any
malicious breach of professional duty or inexcusable negligence or ignorance, shall prejudice his client, or reveal any of the
secrets of the latter learned by him in his professional capacity" (italics supplied). The aforequoted criminal sanction for
unprofessional conduct of an attorney is without prejudice to proper administrative action, such as disbarment or suspension of
attorneys (p. 503, Criminal Law Annotated, Padilla, 1972 Ed.).
(Halili v. Court of Industrial Relations, G.R. No. L-24864, L-27773, L-38655, L-30110 (Resolution), [April 30, 1985])

b. Union Funds
Article 241.
(b) The members shall be entitled to full and detailed reports from their officers and representatives of all financial
transactions as provided for in the constitution and by-laws of the organization;

(g) No officer, agent or member of a labor organization shall collect any fees, dues, or other contributions in its behalf or
make any disbursement of its money or funds unless he is duly authorized pursuant to its constitution and by-laws;

(h) Every payment of fees, dues or other contributions by a member shall be evidenced by a receipt signed by the officer
or agent making the collection and entered into the record of the organization to be kept and maintained for the
purpose;

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(i) The funds of the organization shall not be applied for any purpose or object other than those expressly provided by its
constitution and by-laws or those expressly authorized by written resolution adopted by the majority of the members at
a general meeting duly called for the purpose;

(j) Every income or revenue of the organization shall be evidenced by a record showing its source, and every
expenditure of its funds shall be evidenced by a receipt from the person to whom the payment is made, which shall
state the date, place and purpose of such payment. Such record or receipt shall form part of the financial records of the
organization.

(l) The treasurer of any labor organization and every officer thereof who is responsible for the account of such
organization or for the collection, management, disbursement, custody or control of the funds, moneys and other
properties of the organization, shall render to the organization and to its members a true and correct account of all
moneys received and paid by him since he assumed office or since the last day on which he rendered such account, and
of all bonds, securities and other properties of the organization entrusted to his custody or under his control. The
rendering of such account shall be made:

1. At least once a year within thirty (30) days after the close of its fiscal year;
2. At such other times as may be required by a resolution of the majority of the members of the organization; and
3. Upon vacating his office.

The account shall be duly audited and verified by affidavit and a copy thereof shall be furnished the Secretary of Labor.

(m) The books of accounts and other records of the financial activities of any labor organization shall be open to
inspection by any officer or member thereof during office hours;

(n) No special assessment or other extraordinary fees may be levied upon the members of a labor organization unless
authorized by a written resolution of a majority of all the members in a general membership meeting duly called for the
purpose. The secretary of the organization shall record the minutes of the meeting including the list of all members
present, the votes cast, the purpose of the special assessment or fees and the recipient of such assessment or fees. The
record shall be attested to by the president.

(o) Other than for mandatory activities under the Code, no special assessments, attorney’s fees, negotiation fees or any
other extraordinary fees may be checked off from any amount due to an employee without an individual written
authorization duly signed by the employee. The authorization should specifically state the amount, purpose and
beneficiary of the deduction; and

Article. 274. Visitorial power. - The Secretary of Labor and Employment or his duly authorized representative is hereby
empowered to inquire into the financial activities of legitimate labor organizations upon the filing of a complaint under
oath and duly supported by the written consent of at least twenty percent (20%) of the total membership of the labor
organization concerned and to examine their books of accounts and other records to determine compliance or non-
compliance with the law and to prosecute any violations of the law and the union constitution and by-laws: Provided,
That such inquiry or examination shall not be conducted during the sixty (60)-day freedom period nor within the thirty
(30) days immediately preceding the date of election of union officials.

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c. Sources for Payment of Attorney’s Fees


Article. 241.
(n) No special assessment or other extraordinary fees may be levied upon the members of a labor organization unless
authorized by a written resolution of a majority of all the members in a general membership meeting duly called for the
purpose. The secretary of the organization shall record the minutes of the meeting including the list of all members
present, the votes cast, the purpose of the special assessment or fees and the recipient of such assessment or fees. The
record shall be attested to by the president.
(o) Other than for mandatory activities under the Code, no special assessments, attorney's fees, negotiation fees or any
other extraordinary fees may be checked off from any amount due to an employee without an individual written
authorization duly signed by the employee. The authorization should specifically state the amount, purpose and
beneficiary of the deduction; and

Article. 222. Appearances and Fees.


(b) No attorney’s fees, negotiation fees or similar charges of any kind arising from any collective bargaining agreement
shall be imposed on any individual member of the contracting union: Provided, However, that attorney’s fees may be
charged against union funds in an amount to be agreed upon by the parties. Any contract, agreement or arrangement of
any sort to the contrary shall be null and void.

Cases:
LABOR AND SOCIAL LEGISLATION; LABOR DISPUTES; APPEALS TO OFFICE OF THE PRESIDENT; NO JURISDICTION TO ADJUDICATE
ON ATTORNEYS FEES WHERE APPEAL WAS WITH RESPECT TO COLLECTIVE BARGAINING AGREEMENT TERMS AND CONDITIONS;
CASE AT BAR. — Where the case was appealed to the Office of the President with respect to the CBA terms and conditions, not
with respect to attorney's fees, the Presidential Executive Assistant had no jurisdiction to make an adjudication on Saavedra's
attorney's fees. Although the fees were a mere incident, nevertheless, the jurisdiction to fix the same and to order the payment
thereof was outside the pale of the Office of the President's appellate jurisdiction. Presidential Executive Assistant Clave was
right in adopting a hands-off attitude in his first resolution and holding that the payment of the fees was a question between the
lawyer and the union.
LABOR CODE; ATTORNEY'S FEES; RECOVERY THEREOF UNDER ARTICLE III, LABOR CODE, REFERS TO A PROCEEDING FOR
RECOVERY OF WAGES; CASE AT BAR. — Presidential Executive Assistant Clave should have noticed that Article III which provides
for payment of attorney's fees refers to a proceeding for the recovery of wages and not to CBA negotiations. The two are
different or distinct proceedings.
LIABILITY THEREFOR OF UNION FUNDS IN CASE AT BAR PURSUANT TO ARTICLE 222, LABOR CODE. — The case is covered
squarely by the mandatory and explicit prescription of article 222 which is another guarantee intended to protect the
employee against unwarranted practices that would diminish his compensation without his knowledge and consent. (See
National Power Corporation Supervisors' Union vs. National Power Corporation, L-28805, August 10, 1981, 106 SCRA 556).
Other provisions of the Labor Code animated by the same intention are the following: Article 242, paragraphs (n) and (o);
288, PD 442; 291, PD 570-A; 240, PD 626; 241, PD 850. There is no doubt that lawyer Saavedra is entitled to the payment of his
fees but Article 222 ordains that union funds should be used for that purpose. The amount of P345,000 does not constitute
union funds. It is money of the employees. The union, not the employees, is obligated to Saavedra.
(Pacific Banking Corp. v. Clave, G.R. No. 56965, [March 7, 1984], 213 PHIL 102-107)

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d. Examination of Books
Article 241 (g) (h) (n) (o)
(g) No officer, agent or member of a labor organization shall collect any fees, dues, or other contributions in its behalf or
make any disbursement of its money or funds unless he is duly authorized pursuant to its constitution and by-laws;
(h) Every payment of fees, dues or other contributions by a member shall be evidenced by a receipt signed by the officer
or agent making the collection and entered into the record of the organization to be kept and maintained for the
purpose;
(n) No special assessment or other extraordinary fees may be levied upon the members of a labor organization unless
authorized by a written resolution of a majority of all the members in a general membership meeting duly called for the
purpose. The secretary of the organization shall record the minutes of the meeting including the list of all members
present, the votes cast, the purpose of the special assessment or fees and the recipient of such assessment or fees. The
record shall be attested to by the president.
(o) Other than for mandatory activities under the Code, no special assessments, attorney’s fees, negotiation fees or any
other extraordinary fees may be checked off from any amount due to an employee without an individual written
authorization duly signed by the employee. The authorization should specifically state the amount, purpose and
beneficiary of the deduction; and

Cases:
Hence, the Director acted correctly in ordering an examination of the books and records of the union. The examination should
include a verification of the charge that the petty loans extended by the union to its members were usurious and that the fee for
the issuance of checks is unwarranted since the loans were made in cash.|||
(Duyag v. Inciong, G.R. No. L-47775, [July 5, 1980], 187 PHIL 346-357)

e. Deposit Funds
RULE XI
INTER/INTRA-UNION DISPUTES AND OTHER RELATED LABOR RELATIONS DISPUTES
(read IRR)
RULE XIII
ADMINISTRATION OF TRADE UNION FUNDS AND ACTIONS ARISING THEREFROM
(read IRR)

Cases:
UNION DUES; PRELIMINARY INJUNCTION REGARDING DEPOSIT OF UNION DUES PROPER IN INSTANT CASE. — Complainant Coto
Labor Union filed a motion for preliminary injunction to enjoin Benguet Consolidated, Inc. and Consolidated Workers Union from
negotiating and concluding, between themselves, a new collective bargaining agreement; to enjoin the corporation from turning
over to the latter union, and for the latter to receive from the former, the dues collected from the workers, and from disbursing
said dues; and for the deposit into court of all dues collected or which may thereafter be collected. The said motion makes out a
prima facie showing of a right to the final relief which is necessary to preserve the right asserted by the movant, and herein
petitioner Consolidated Workers Union admitted in its answer in the main case that deductions made pursuant to the previous
agreement between the company and the Coto Labor Union were subsequently turned over to the Consolidated Workers Union
from the time the company learned about the cancellation of the registration permit of the Coto Labor Union. Hence, the lower
court, even without the evidence alluded to by the petitioner as necessary, had sufficient basis on record to support its order.

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The court acted reasonably, and with fairness to the parties, and not abusively as charged, in adopting the remedial measure of
ordering the deposit of the union dues which were turned over to the herein petitioner, considering that the complaint asked the
Industrial Court to declare that the Consolidated Workers' Union, petitioner herein, was either a company union or was company
dominated.
NO DEPRIVATION OF PROPERTY WITHOUT DUE PROCESS IN INSTANT CASE. — There is no merit to the argument of petitioner
that the order directing the Consolidated Workers Union to deposit in court the union dues involved constitutes deprivation of
property without due process of law. As pointed out in the appealed order, if the Industrial Court, after hearing, should
ultimately find that the Consolidated Workers Union is company dominated or is a company union and order it dis-established,
the result would be that petitioner would have to return all moneys and dues collected by it from the workers, since the union
would have had no authority to represent the workers. Because the moneys collected might be improperly spent by the time the
dis-establishment order is made, it was logical for the court below to order that such moneys be deposited in the meantime.
(Consolidated Workders Union v. Court of Industrial Relations, G.R. No. L-25333, [March 28, 1969], 137 PHIL 260-268)

f. Union Dues
RULE XIII
ADMINISTRATION OF TRADE UNION FUNDS AND ACTIONS ARISING THEREFROM
(read IRR)
Cases:
RESOLUTION ALLOWING INCREASE IN UNION DUES, ILLEGAL AND ARBITRARY. — Concerning the increase of union dues, the
respondent Director found that the resolution of the union's Legislative Council to this effect does not bear the signature of at
least two-thirds (2/3) of the members of the Council, contrary to the requirement of the union constitution and by-laws; and that
proof is wanting of proper ratification of the resolution by a majority of the general union membership at a plebiscite called and
conducted for that purpose, again in violation of the constitution and by-laws. The resolution increasing the union dues must
therefore be struck down, as illegal and void, arbitrary and oppressive. The collection of union dues at the increased rates must
be discontinued; and the dues thus far improperly collected — refunded to the union members or held in trust for disposition by
them in accordance with their charter and rules, in line with this Court's ruling in a parallel situation (San Miguel Corporation vs.
Noriel, 103 SCRA 185).|||
(Rodriguez v. Dir. Bureau of Labor Relations, G.R. Nos. 76579-82, 80504, [August 31, 1988])

g. Sources for Payment of Special Assessments


Cases:
REQUISITES FOR THE VALIDITY THEREOF. — The pertinent legal provisions on check-offs are found in Article 222 (b) and Article
241 (o) of the Labor Code. Article 222 (b) states: "No attorney's fees, negotiation fees or similar charges of any kind arising from
any collective bargaining negotiations or conclusions of the collective agreement shall be imposed on any individual member of
the contracting union: Provided, however, that attorney's fees may be charged against union fundsin an amount to be agreed
upon by the parties. Any contract, agreement or arrangement of any sort to the contrary shall be null and void." Article 241 (o)
provides: "Other than for mandatory activities under the Code, no special assessment, attorney's fees, negotiation fees or any
other extraordinary fees may be checked off from any amount due to an employee without an individual written authorization
duly signed by the employees. The authorization should specifically state the amount, purpose and beneficiary of the deduction."
Article 241 has three (3) requisites for the validity of the special assessment for union's incidental expenses, attorney's fees and
representation expenses. These are: (1) authorization by a written resolution of the majority of all the members at the general
membership meeting called for the purpose; (2) secretary's record of the minutes of the meeting; and (3) individual written
authorization for check off duly signed by the employees concerned. Clearly, attorney's fees may not be deducted or checked off
from any amount due to an employee without his written consent.|||

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(Gabriel v. Secretary of Labor and Employment, G.R. No. 115949, [March 16, 2000], 384 PHIL 797-807)

h. Mandatory Activity
Article 241 (o)
(o) Other than for mandatory activities under the Code, no special assessments, attorney’s fees, negotiation fees or
any other extraordinary fees may be checked off from any amount due to an employee without an individual written
authorization duly signed by the employee. The authorization should specifically state the amount, purpose and
beneficiary of the deduction; and
Cases:
LABOR LAWS AND SOCIAL LEGISLATION; LABOR UNIONS; ATTORNEY'S FEES MAY NOT BE DEDUCTED OR CHECKED OFF WITHOUT
WORKER'S WRITTEN CONSENT, EXCEPT FOR MANDATORY ACTIVITY; MANDATORY ACTIVITY, DEFINED. — It is very clear from Art.
241 of the Labor Code that attorney's fees may not be deducted or checked off from any amount due to an employee without his
written consent except for mandatory activities under the Code. A mandatory activity has been defined as a judicial process of
settling dispute laid down by the law.
(Carlos P. Galvadores, et al. vs. Cresenciano B. Trajano, Director of the Bureau of Labor Relations, et al., G.R. No. L-70067,
September 15, 1986, 144 SCRA 138).

CASE AT BAR IS NOT A MANDATORY ACTIVITY. — The amicable settlement entered into by the management and the union —
whereby the company will pay to the union members the sum of P150,000.00 for their claims arising from the unpaid emergency
cost of living allowance (ECOLA) and other benefits — can not be considered as a mandatory activity under the Code. It is true
that the union filed a claim for emergency cost of living allowance and other benefits before the Ministry of Labor. But this case
never reached its conclusion in view of the parties' agreement.
(Vengco v. Trajano, G.R. No. 74453, [May 5, 1989], 255 PHIL 147-155)

i. CBA Negotiation
Cases:
BENEFITS FORMING PART OF THE COLLECTIVE BARGAINING AGREEMENT; NOT THE "MANDATORY ACTIVITY" CONTEMPLATED IN
THE CODE. — Contrary to respondent Union's and Counsel's stand, the benefits awarded to PLDT employees still formed part of
the collective bargaining negotiations although placed already under compulsory arbitration. This is not the "mandatory activity"
under the Code which dispenses with individual written authorizations for check-offs, notwithstanding its "compulsory"
nature.|||
(Galvadores v. Trajano, G.R. No. 70067 (Resolution), [September 15, 1986], 228 PHIL 138-145)

j. Union Information
Article 241 (p)
(p) It shall be the duty of any labor organization and its officers to inform its members on the provisions of its
constitution and by-laws, collective bargaining agreement, the prevailing labor relations system and all their rights and
obligations under existing labor laws.

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k. Union Officer – Obligation


Cases:
It is within the power of the NLRC to order the removal of the officers of petitioner. This is provided for in the labor law.
"Art. 242. 5 Rights and conditions of membership in a labor organization. — The following are the rights and
conditions of membership in a labor organization:
xxx xxx xxx
(p) It shall be the duty of any labor organization and its officers to inform its members on provisions of the
constitution and by-laws, collective bargaining agreement, the prevailing labor relations system and all their
rights and obligations under existing labor laws. For this purpose, registered labor organizations may assess
reasonable dues to finance labor relations seminars and other labor education activities.
Any violation of the above rights and conditions of membership shall be a ground for cancellation of union
registration or expulsion of an officer from office, which ever is appropriate. At least 30 per cent of all the
members of a union or any member or members specifically concerned may report such violation to the
Bureau. The Bureau shall have the power to hear and decide any reported violation and to mete out the
appropriate penalty."
The officers of petitioner misinformed the members and led them into staging an illegal strike. If the NLRC is to attain the
objective of the Labor Code to ensure a stable but dynamic and just industrial peace 6 the removal of undesirable labor leaders
must be effected.
(Continental Cement Corp. Labor Union v. Continental Cement Corp., G.R. No. 51544, [August 30, 1990], 267 PHIL 162-171)

6. Employee Individual Rights


Cases:
LABOR AND SOCIAL LEGISLATION; LABOR CODE; LABOR UNIONS RIGHT TO REPRESENT DOES NOT DEPRIVE MEMBERS OF A RIGHT
TO FILE CASE IN THEIR OWN NAMES OR WITHDRAW FROM CASE FILED BY UNION. — The right of URFA as a legitimate labor
union to represent its members is expressly guaranteed under Art. 242 of the Labor Code. This right, however, does not deprive
its individual members of their concommitant right to file a case in their own names, nor of their right to withdraw from any case
filed by the union in their behalf. More importantly, the individual member may seasonably exercise his option to withdraw from
a case filed by his union if he does not want to be bound thereby.
(Aldovino v. NLRC, G.R. No. 121189, [November 16, 1998], 359 PHIL 54-64)

a. Enforcement and Remedies – Procedures and Sanctions


Article 241 (Last Paragraph)

Any violation of the above rights and conditions of membership shall be a ground for cancellation of union registration
or expulsion of officers from office, whichever is appropriate. At least thirty percent (30%) of the members of a union or
any member or members specially concerned may report such violation to the Bureau. The Bureau shall have the power
to hear and decide any reported violation to mete the appropriate penalty.

Criminal and civil liabilities arising from violations of above rights and conditions of membership shall continue to be
under the jurisdiction of ordinary courts.

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RULE XI
INTER/INTRA-UNION DISPUTES AND OTHER RELATED LABOR RELATIONS DISPUTES
(read IRR)
RULE IV
PROVISIONS COMMON TO THE REGISTRATION OF LABOR ORGANIZATIONS AND WORKERS ASSOCIATION
(read IRR)

b. Test for Existence of Rights


Cases:
The contention of petitioners that the charges against them being intra-union problems, should have been investigated in
accordance with the constitution and by-laws of the Amigo Employees Union-PAFLU and not of the PAFLU, is not impressed with
merit. It is true that under the Implementing Rules and Regulations of the Labor Code, in case of intra-union disputes, redress
must first be sought within the organization itself in accordance with its constitution and by-laws. However, it has been held that
this requirement is not absolute but yields to exception under varying circumstances. Thus, in Kapisanan ng mga Manggagawa
sa MRR vs. Hernandez, 20 SCRA 109, We held:
"In the case at bar, noteworthy is the fact that the complaint was filed against the union and its incumbent
officers, some of whom were members of the board of directors. The constitution and by-laws of the union
provide that charges for any violations thereof shall be filed before the said board. But as explained by the
lower court, if the complainants had done so the board of directors would in effect be acting as respondent
investigator and judge at the same time. To follow the procedure indicated would be a farce under the
circumstances, where exhaustion of remedies within the union itself would practically amount to a denial of
justice or would be illusory or vain, it will not be insisted upon, particularly where property rights of the
members are involved, as a condition to the right to invoke the aid of a court."
The facts of the instant petition stand on all fours with the aforecited case that the principle therein enunciated applies here as
well. In the case at bar, the petitioners were charged by the officers of the Amigo Employees Union-PAFLU themselves who were
also members of the Board of Directors of the Amigo Employees Union-PAFLU. Thus, were the petitioners to be charged and
investigated according to the local union's constitution, they would have been tried by a trial committee of three (3) elected from
among the members of the Board who are themselves the accusers. (Section 2, Article 11, Constitution of the Local Union).
Petitioners would be in a far worse position had this procedure been followed. Nonetheless, petitioners admit in their petition
that two (2) of the six (6) charges, i.e. disaffiliation and filing a petition for certification election, are not intra-union matters and,
therefore, are cognizable by PAFLU.
(Villar v. Inciong, G.R. Nos. L-50283-84, [April 20, 1983], 206 PHIL 366-387)

c. Jurisdiction – Exhaustion of Internal Remedies


Cases:
NON-REGISTERED LABOR ORGANIZATION ACQUIRES NO LEGAL PERSONALITY; CASE AT BAR. — The Amigo Employees Union, as
an independent, union, is not duly registered at such with the Bureau of Labor Relations. The appealed decision of OIC Leogardo
of Regional Office No. 4 states at a fact that there is no record in the Bureau of Labor Relations that the Amigo Employees Union
(Independent) is registered, and (his is not disputed by petitioners, notwithstanding their allegation that the Amigo Employees
Union is a duly registered labor organization bearing Ministry of Labor Registration Certificate No. 5290-IP dated March 27, 1967.
But the independent union organized after the "Sama- Samang Kapasiyahan" executed February 7, 1977 could not have been
registered earlier, much less March 27, 1967 under Registration Certificate No. 5290-IP. As such unregistered union, it acquires
no legal personality and is not entitled to the rights and privileges granted by law to legitimate labor organizations upon issuance
of the certificate of registration. Simply put, the Amigo Employees Union (Independent) which petitioners claim to represent, not

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being a legitimate labor organization, may not validly present representation issues. Therefore, the act of petitioners cannot be
considered a legitimate exercise of their right to self-organization.|||
(Villar v. Inciong, G.R. Nos. L-50283-84, [April 20, 1983], 206 PHIL 366-387)

d. Remedies
Cases:
LABOR AND SOCIAL LEGISLATIONS; LABOR CODE; ORDER FOR THE HOLDING OF REFERENDUM; TO DECIDE EXPULSION OR
SUSPENSION OF UNION MEMBERS; RENDERED MOOT IN THE CASE AT BAR. — By and large, the holding of the referendum
(election of officers of the labor union) in question has become moot and academic. This is in line with Our ruling in Pascual vs.
Provincial Board of Nueva Ecija, 106 Phil. 471, which We quote: "The Court should never remove a public officer for acts done
prior to his present term of office. To do otherwise would be to deprive the people of their right to elect their officers. When the
people have elected a man to office, it must be assumed that they did this with knowledge of his life and character, and that they
disregarded or forgave his faults or misconduct, if he had been guilty of any. It is not for the court, by reason of such faults or
misconduct to practically overrule the will of the people.|||
(Kapisanan ng Manggagawang Pinagyakap v. Cresenciano Trajano, G.R. No. 62306, [January 21, 1985], 219 PHIL 209-214)

e. Invalidity
Cases:
LABOR LAW; LABOR ORGANIZATION; ELECTION OF UNION OFFICERS HELD INVALID; CASE AT BAR. — The provincial elections for
union officers were moved to a later date without prior notice to all voting members and without ground rules duly prescribed
therefor. The elections in Metro Manila were conducted under no better circumstances, were held in defiance of the temporary
restraining order issued on July 23, 1986 despite previous notice of said order to all parties concerned. Said elections must
therefor be rendered void. The claim that a heavy voter turn-out of 73%, even if true cannot purge the elections of their grave
defects. Besides, the protected right of workers to self-organization would be diluted if the election of the officers who will
govern their affairs is not fairly and honestly conducted.
(Rodriguez v. Dir. Bureau of Labor Relations, G.R. Nos. 76579-82, 80504, [August 31, 1988])

G. UNION AFFILIATION: LOCAL AND PARENT RELATIONS


1. Affiliation: Purpose of; Nature Relationship
a. Nature of Relationship
Cases:
A LOCAL UNION MAINTAINS ITS SEPARATE PERSONALITY DESPITE AFFILIATION WITH A LARGER NATIONAL FEDERATION. —
Petitioner argues that giving due course to respondent union's petition for certification election would violate the separation of
unions doctrine. Note that the petition was filed by APSOTEU-TUCP, a legitimate labor organization. It was not filed by ALU. Nor
was it filed by TUCP, which is a national labor federation of which respondent union is affiliated. Petitioner says that respondent
union is a mere alter ego of ALU. The records show nothing to this effect. What the records instead reveal is that respondent
union was initially assisted by ALU during its preliminary stages of organization. A local union maintains its separate personality
despite affiliation with a larger national federation. Petitioner alleges that ALU seeks to represent both respondent union and the
rank-and-file union. Again, we find nothing in the records to support this bare assertion.
(Sugbuanon Rural Bank, Inc. v. Laguesma, G.R. No. 116194, [February 2, 2000], 381 PHIL 414-427)

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b. Effect of Legal Personality


Cases:
LABOR UNION; A REGISTERED LOCAL UNION AFFILIATED WITH A NATIONAL UNION OR FEDERATION DOES NOT LOSE ITS LEGAL
PERSONALITY OR INDEPENDENCE. — A duly registered local union affiliated with a national union or federation does not lose its
legal personality or independence (Adamson and Adamson, Inc. vs. The Court of Industrial Relations and Adamson and Adamson
Supervising Union (FFW), 127 SCRA 268 [1984]). In Elisco-Elirol Labor Union (NAFLU) vs. Noriel (180 SCRA 681 [1977]), then
Justice Teehankee re-echoed the words of Justice Esguerra in Liberty Cotton Mills Workers Union vs. Liberty Cotton Mills, Inc. (66
SCRA 512 [1975], thus: (T)he locals are separate and distinct units primarily designed to secure and maintain an equality of
bargaining power between the employer and their employee-members in the economic struggle for the fruits of the joint
productive effort of labor and capital; and the association of the locals into the national union (as PAFLU) was in furtherance of
the same end. These associations are consensual entities capable of entering into such legal relations with their members. The
essential purpose was the affiliation of the local unions into a common enterprise to increase by collective action the common
bargaining power in respect of the terms and conditions of labor. Yet the locals remained the basic units of association, free to
serve their own and the common interest of all, subject to the restraints imposed by the Constitution and By-Laws of the
Association, and free also to renounce the affiliation for mutual welfare upon the terms laid down in the agreement which
brought it into existence. Appending "AFW" to the local union's name does not mean that the federation absorbed the latter. No
such merger can be construed. Rather, what is conveyed is the idea of affiliation, with the local union and the larger national
federation retaining their separate personalities.
(St. Luke's Medical Center, Inc. v. Torres, G.R. No. 99395, [June 29, 1993])
VALIDLY ENTERED INTO BY A FEDERATION WHERE CONSTITUENTS ARE ALSO THE LOCAL UNION OFFICERS; CASE AT BENCH. — It
is further argued that the CBA has no binding force since it was entered into by KAMAPI as a federation and not by the local
union. Perusal of the agreement proves the contention flawed. The signatories for KAMAPI consisted of its national president and
of the duly elected officers of the local union. Thus the fact that KAMAPI was particularly mentioned as the bargaining party
without specifying the local union cannot strip it of its authority to participate in the bargaining process. The local union
maintains its separate personality despite affiliation with a larger national federation.
(Pambansang Kapatiran ng mga Anak Pawis sa Formey Plastic National Workers Brotherhood v. Secretary of Labor, G.R. No.
111836, [February 1, 1996], 323 PHIL 116-126)
LABOR AND SOCIAL LEGISLATION; LABOR CODE; LABOR RELATIONS; LOCAL UNION HAS RIGHT TO DISAFFILIATE FROM MOTHER
UNION OR DECLARE ITS AUTONOMY. — A local union has the right to disaffiliate from its mother union or declare its autonomy.
A local union, being a separate and voluntary association, is free to serve the interests of all its members including the freedom
to disaffiliate or declare its autonomy from the federation to which it belongs when circumstances warrant, in accordance with
the constitutional guarantee of freedom of association. Thus, a local union which has affiliated itself with a federation is free to
sever such affiliation anytime and such disaffiliation cannot be considered disloyalty. In the absence of specific provisions in the
federation's constitution prohibiting disaffiliation or the declaration of autonomy of a local union, a local may dissociate with its
parent union.
(Malayang Samahan Ng Mga Manggagawa Sa M. Greenfield v. Ramos, G.R. No. 113907, [February 28, 2000], 409 PHIL 61-88)

2. Supervisor – Rank and File Union Affiliation


a. Rule on Affiliation
Cases:
SUPERVISORY EMPLOYEES NOT ALLOWED TO JOIN RANK-AND-FILE UNION; REASON. — The exclusion, therefore, of middle level
executives from the category of managers brought about a third classification, the supervisory employees. These supervisory
employees are allowed to form their own union but they are not allowed to join the rank-and-file union because of conflict of
interest (Journal of the Senate, First Regular Session, 1987-1988, Volume 3, p. 2245).

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EXTENT OF PROHIBITION. — The Court emphasizes that the limitation is not confined to a case of supervisors wanting to join a
rank-and-file local union. The prohibition extends to a supervisors' local union applying for membership in a national federation
the members of which include local unions of rank-and-file employees. The intent of the law is clear especially where, as in the
case at bar, the supervisors will be co-mingling with those employees whom they directly supervise in their own bargaining unit.
LABOR AND SOCIAL LEGISLATION; ID.; EMPLOYEES RIGHT TO SELF-ORGANIZATION; NOT INTERFERED WITH BY THE PROHIBITION
ON SUPERVISORY EMPLOYEES FROM JOINING RANK AND FILE LABOR UNION. — The respondent contends that the law prohibits
the employer from interfering with the employees' right to self-organization. There is no question about this intendment of the
law. There is, however, in the present case, no violation of such a guarantee to the employee. Supervisors are not prohibited
from forming their own union. What the law prohibits is their membership in a labor organization of rank-and-file employees
(Art. 245, Labor Code) or their joining a national federation of rank-and-file employees that includes the very local union which
they are not allowed to directly join.
DEPARTMENT OF LABOR AND EMPLOYMENT; ORDER ALLOWING CERTIFICATION ELECTION INVOLVING A UNION OF
SUPERVISORY AND RANK AND FILE EMPLOYEES AND A NO UNION, CONTRARY TO LAW. — In a motion dated November 15, 1991
it appears that the petitioner has knuckled under to the respondents' pressures and agreed to let the national federation
KAMPIL-KATIPUNAN represent its supervisors in negotiating a collective bargaining agreement. Against the advise of its own
counsel and on the basis of alleged "industrial peace," the petitioner expressed a loss of interest in pursuing this action. The
petitioner is, of course, free to grant whatever concessions it wishes to give to its employees unilaterally or through negotiations
but we cannot allow the resulting validation of an erroneous ruling and policy of the Department of Labor and Employment
(DOLE) to remain on the basis of the petitioner's loss of interest. The December 14, 1990 order and the November 21, 1990
resolution of DOLE are contrary to law and must be declared as such.
(Atlas Lithographic Services, Inc. v. Laguesma, G.R. No. 96566, [January 6, 1992])
SUPERVISORY EMPLOYEES' RIGHT THERETO RESTRICTED BUT MAY NOT BE DENIED; CASE AT BAR. — The right of supervisory
employees to organize under the Industrial Peace Act carries certain restrictions but the right itself may not be denied or unduly
abridged. The supervisory employees of an employer cannot join any labor organization of employees under their supervision
but may validly form a separate organization of their own. As stated in Caltex Filipino Managers and Supervisors Association v.
Court of Industrial Relations (47 SCRA 112), it would be to attach unorthodoxy to, not to say an emasculation of, the concept of
law if managers as such were precluded from organizing. Thus, if Republic Act 875, in its Section 3, recognizes the right of
supervisors to form a separate organization of their own, albeit they cannot be members of a labor organization of employees
under their supervision, that authority of supervisors to form a separate labor union carries with it the right to bargain
collectively with the employer. (Government Service Insurance System v. Government Service Insurance System Supervisors'
Union, 68 SCRA 418).
AFFILIATION OF LOCAL UNION WITH A NATIONAL UNION OR FEDERATION; EFFECT THEREOF; CASE AT BAR. — The specific issue
before us is whether or not a supervisor's union may affiliate with a federation with which unions of rank-and-file employees of
the same employer are also affiliated. We find without merit the contentions of petitioner that if affiliation will be allowed, only
one union will in fact represent both supervisors and rank-and-file employees of the petitioner; that there would be an indirect
affiliation of supervisors and rank-and-file employees with one labor organization; that there would be a merging of the two
bargaining units; and that the respondent union will lose its independence because it becomes an alter ego of the federation.
There is nothing in the provisions of the Industrial Peace Act which provides that a duly registered local union affiliating with a
national union or federation loses its legal personality, or its independence. Notwithstanding affiliation, the local union remained
the basic unit free to serve the common interest of all its members (Elisco-Elirol Labor Union vs. Noriel, 80 SCRA 681 and Liberty
Cotton Mills Workers Union vs. Noriel 80 SCRA 681 and Liberty Cotton Mills Workers Union vs. Liberty cotton Mills Inc., 66 SCRA
512). In the case at bar, the Adamson and Adamson Supervisory Union and the Adamson and Adamson, Inc., Salesmen
Association (FFW), have their own respective constitutions and by-laws. They are separately and independently registered of
each other. Both sent their separate proposals for collective bargaining agreements with their employer. There could be no
employer influence on rank-in-file organizational activities nor there could be any rank and file influence on the supervisory
functions of the supervisors because of the representation sought to be proscribed.
(Adamson & Adamson, Inc. v. Court of Industrial Relations, G.R. No. L-35120, [January 31, 1984], 212 PHIL 250-256)

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b. Local Union Disaffiliation


Nature of Right of Disaffiliation
Cases:
The right of a local union to disaffiliate from its mother union is well-settled. In previous cases, it has been repeatedly held that a
local union, being a separate and voluntary association, is free to serve the interest of all its members including the freedom to
disaffiliate when circumstances warrant. 4 This right is consistent with the Constitutional guarantee of freedom of association
(Article IV, Section 7, Philippine Constitution)
In the implementation and interpretation of the provisions of the Labor Code and its implementing regulations, the
workingman's welfare should be the primordial and paramount consideration. In the case at bar, it would go against the spirit of
the labor law to restrict petitioner's right to self-organization due to the existence of the CBA. We agree with the Med-Arbiter's
opinion that "A disaffiliation does not disturb the enforceability and administration of a collective agreement; it does not
occasion a change of administrators of the contract nor even an amendment of the provisions thereof." 6 But nowhere in the
record does it appear that the contract entered into by the petitioner and ALUMETAL prohibits the withdrawal of the former
from the latter. (Volkschel Labor Union v. Bureau of Labor Relations, G.R. No. L-45824, [June 19, 1985], 221 PHIL 423-430)

c. Rules on Legality of Act of Disaffiliation


Cases:
LABOR RELATIONS; LABOR ORGANIZATIONS; DISAFFILIATION OF LOCAL UNION FROM A FEDERATION, LEGAL IN CASE AT BAR. —
The right of local union to disaffiliate from a federation in the absence of any provision in the federation's constitution preventing
disaffiliation of a local union is legal (People's Industrial and Commercial Employees and Workers Org. (FFW) vs. People's
Industrial and Commercial Corp., 112 SCRA 440 [1982]). Such right is consistent with the constitutional guarantee of freedom of
association (Tropical Hut Employees' Union-CGW vs. Tropical Hut Food Market, Inc., 181 SCRA 173 [1990]). Hence, while
petitioners' act of holding a special election to oust Capitle, et al. may be considered as an act of sowing disunity among the
SAMAHAN members, and, perhaps, disloyalty to the union officials, which could have been dealt with by the union as a
disciplinary matter, it certainly cannot be considered as constituting disloyalty to the union. Faced with a SAMAHAN leadership
which they had tried to remove as officials, it was but a natural act of self-preservation that petitioners fled to the arms of the
FEDLU after the union and the OFC had tried to terminate their employment. Petitioners should not be made accountable for
such an act.
(Ferrer v. NLRC, G.R. No. 100898, [July 5, 1993])
LABOR AND SOCIAL LEGISLATION; LABOR CODE; CLOSED SHOP, A VALID FORM OF UNION SECURITY; CASE AT BAR. —
Disaffiliation from a labor union is implicit in the freedom of association ordained by the Constitution. But this Court has laid
down the ruling that a closed shop is a valid form of union security, and such provision is not a restriction of the right of freedom
of association guaranteed by the Constitution. In the case at bar, it appears at an undisputed fact that on February 15,1977, the
Company and the Amigo-Employees Union-PAFLU entered into a Collective Bargaining Agreement with a union security clause
provided for in Article XII thereof which is a reiteration of the same clause in the old CBA. The quoted stipulation for closed-shop
is clear and unequivocal and it leaves no room for doubt that the employer is bound, under the collective bargaining agreement,
to dismiss the employees, herein petitioners, for non-union membership. Petitioners became non-union members upon their
expulsion from the general membership of the Amigo Employees Union-PAFLU on March 15, 1977 pursuant to the Decision of
the PAFLU national president.
LOCAL UNION BOUND BY LAWS OF THE PARENT ORGANIZATION; EXPULSION BY MOTHER UNION OF LOCAL MEMBERS VALID. —
That PAFLU had the authority to investigate petitioners on the charges filed by their co-employees in the local union and after
finding them guilty at charged, to expel them from the roll of membership of the Amigo Employees Union-PAFLU is clear under
the constitution of the PAFLU to which the local union was affiliated. And pursuant to the security clause of the new CBA,
reiterating the same clause in the old CBA, PAFLU was justified in applying said security clause. Recognized and salutary is the
principle that when a labor union affiliates with a mother union, it becomes bound by the laws and regulations of the parent

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organization. It is undisputable that herein petitioners were members of the Amigo Employees Union at the time said union war
affiliated with PAFLU, hence, under the aforesaid principle, they are bound by the laws and regulations of PAFLU.
DISAFFILIATION AND QUESTIONS OF REPRESENTATION BY MINORITY LOCAL UNION, NOT BINDING ON THE MAJORITY LOCAL
UNION. — Had the petitioners merely disaffiliated from the Amigo Employees Union-PAFLU, there could be no legal objections
thereto for it was their right to do so. But what petitioners did by the very clear terms of their "Sama-Samang Kasiyahan" was to
disaffiliate the Amigo Employees Union-PAFLU from PAFLU, an act which they could not have done with any effective
consequence because they constituted the minority in the Amigo Employees Union-PAFLU. It is true, as contended by
petitioners, that under Article 237 of the Labor Code and Section 3, Rule 2, Book 2 of its Implementing Rules, questions of
exclusive bargaining representation are enteruanable within the sixty (60) days prior to the expiry date of an existing CBA, and
that they did file a petition for certification election within that period. But the petition was filed in the name of the Amigo
Employees Union-PAFLU which had not disaffiliated from PAFLU, the mother union. Petitioners being a minority of the local
union may not bind the majority members of the local union.
(Villar v. Inciong, G.R. Nos. L-50283-84, [April 20, 1983], 206 PHIL 366-387)
DISAFFILIATION; LOCAL UNION HAS RIGHT TO DISAFFILIATE FROM THE MOTHER FEDERATION. — The claim of the Philippine
Association of Free Labor Unions that the local union cannot validly disaffiliate from it as the Union Security Clause of the
Collective Bargaining Agreement so provided is not correct, because the operation of such clause is limited by Article X of the
local union's Constitution and By-laws which provides that the local shall remain as affiliate of the federation as long as ten (10)
or more of its members evidence their desire to continue the local union's affiliation. And where 32 of the 36 members of the
local union signed the Resolution of disaffiliation, such disaffiliation is valid under its Constitution and By-laws which, taken
together with the Collective Bargaining Agreement, is controlling.
RETRACTION OF THE MEMBERS AFTER THEIR DISMISSAL FROM THE RESOLUTION OF DISAFFILIATION IMMATERIAL. — The
conclusion of the labor court that the retraction of the 16 members-signatories obliterated their participation in the resolution so
that the local union remained an affiliate of the federation is untenable on the ground that not all signatories to the resolution of
disaffiliation retracted and the retraction took place four days after the petitioners were dismissed. There is no use in saying that
the retraction obliterated the act of disaffiliation when petitioners were already out of the service when it was done. The
disaffiliation coming as it did from the greater majority of its member, is more than enough to show the collective desire of the
members of the petitioner's union to severe their relation from the mother federation. The right of disaffiliation is inherent in the
compact and such act should not have been branded as an act of disloyalty, especially considering the cause which impelled the
union to take such a step.
(Liberty Cotton Mills Workers Union v. Liberty Cotton Mills, Inc., G.R. No. L-33987, [September 4, 1975], 160-A PHIL 18-29)
LABOR AND SOCIAL LEGISLATION; LABOR CODE; BUREAU OF LABOR RELATIONS; HAS JURISDICTION TO ACT ON AN INTER-UNION
CONFLICT. — The issue of disaffiliation is an inter-union conflict the jurisdiction of which properly lies with the Bureau of Labor
Relations (BLR) and not with the Labor Arbiter.
LABOR ORGANIZATIONS; LOCAL UNION; HAS RIGHT TO DISAFFILIATE FROM MOTHER FEDERATION. — The right of a local union
to disaffiliate from its mother federation is not a novel thesis unillumined by case law. In the landmark case of Liberty Cotton
Mills Workers Union vs. Liberty Cotton Mills, Inc. we upheld the right of local unions to separate from their mother federation on
the ground that as separate and voluntary associations, local unions do not owe their creation and existence to the national
federation to which they are affiliated but, instead, to the will of their members.
PENDENCY OF ELECTION PROTEST INVOLVING BOTH MOTHER FEDERATION AND LOCAL UNION DOES NOT BAR VALID
DISAFFILIATION; CASE AT BAR. — There is nothing shown in the records nor is it claimed by PAFLU that the local union was
expressly forbidden to disaffiliate from the federation nor were there any conditions imposed for a valid breakaway. As such, the
pendency of an election protest involving both the mother federation and the local union did not constitute a bar to a valid
disaffiliation. Neither was it disputed by PAFLU that 111 signatories out of the 120 members of the local union; or an equivalent
of 92.5% of the total union membership supported the claim of disaffiliation and had in fact disauthorized PAFLU from instituting
any complaint in their behalf. Surely, this is not a case where one (1) or two (2) members of the local union decided to disaffiliate
from the mother federation, but it is a case where almost all local union members decided to disaffiliate.
(Philippine Skylanders, Inc. v. National Labor Relations Commission, G.R. No. 127374, 127431, [January 31, 2002])

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d. Minority Disaffiliation
Cases:
"In the instant case, it is not disputed that the collective bargaining agreement certified by the National Labor Relations
Commission was not ratified by the majority of the employees within the bargaining unit. This is defective. It is blatant non-
observance of the basic requirement necessary to certification. To allow it to remain uncorrected would allow circumvention of
what the law specifically ordained. We cannot countenance irregularities of the highest order to exist in our very own eyes to be
perpetuated. With respect to the complaint of the confirmation of disaffiliation of the members of respondent Philippine Labor
Alliance Council, the same should be resolved in the most expedient and simple method of determining the exclusive bargaining
representative — the holding of a certification election."
(Philippine Labor Alliance Council v. Bureau of Labor Relations, G.R. No. L-41288, [January 31, 1977], 166 PHIL 171-183)
e. Period
Cases:
LOCAL UNION HAS THE RIGHT TO DISAFFILIATE FROM ITS MOTHER UNION EVEN BEFORE THE ONSET OF THE FREEDOM PERIOD
WHEN THERE IS S SHIFT OF ALLEGIANCE ON THE PART OF THE MAJORITY OF THE LOCAL UNION MEMBERS. — Settled is the rule
that a local union has the right to disaffiliate from its mother union when circumstances warrant. Generally, a labor union may
disaffiliate from the mother union to form a local or independent union only during the 60-day freedom period immediately
preceding the expiration of the CBA. However, even before the onset of the freedom period, disaffiliation may be carried out
when there is a shift of allegiance on the part of the majority of the members of the union.
(Alliance of Nationalist and Genuine Labor Organizations v. Samahan ng mga Manggagawang Nagkakaisa sa Manila Bay
Spinning Mills at J.P. Coats, G.R. No. 118562, [July 5, 1996], 327 PHIL 1011-1018)

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PART FOUR – THE APPROPRIATE BARGAINING UNIT


A. LAW AND DEFINITION
Art 255
Article 255. Exclusive bargaining representation and workers participation in policy and decision-making. “ The labor organization
designated or selected by the majority of the employees in an appropriate collective bargaining unit shall be the exclusive
representative of the employees in such unit for the purpose of collective bargaining. However, an individual employee or group
of employees shall have the right at any time to present grievances to their employer.
Any provision of law to the contrary notwithstanding, workers shall have the right, subject to such rules and regulations as the
Secretary of Labor and Employment may promulgate, to participate in policy and decision-making processes of the establishment
where they are employed insofar as said processes will directly affect their rights, benefits and welfare. For this purpose, workers
and employers may form labor-management councils: Provided, That the representatives of the workers in such labor-
management councils shall be elected by at least the majority of all employees in said establishment.
BVRIS1(d)
(d) "Bargaining Unit" refers to a group of employees sharing mutual interests within a given employer unit, comprised of all or
less than all of the entire body of employees in the employer unit or any specific occupational or geographical grouping within
such employer unit.

Cases:
LABOR AND SOCIAL LEGISLATION; LABOR CODE; COLLECTIVE BARGAINING UNIT; PROPER CONSTITUENCY, CITED. — Among the
factors considered in Democratic Labor Association v. Cebu Stevedoring Co. Inc. (103 Phil 1103 [1958]) are: "(1) will of employees
(Glove Doctrine); (2) affinity and unity of employee's interest, such as substantial similarity of work and duties or similarity of
compensation and working conditions; (3) prior collective bargaining history; and (4) employment status, such as temporary,
seasonal and probationary employees".
BASIC TEST OF ACCEPTABILITY. — In any event, whether importance is focused on the employment status or the mutuality of
interest of the employees concerned "the basic test of an asserted bargaining unit's acceptability is whether or not it is
fundamentally the combination which will best assure to all employees the exercise of their collective bargaining rights"
(Democratic Labor Association v. Cebu Stevedoring Co. Inc. supra)
(Belyca Corp. v. Calleja, G.R. No. 77395, [November 29, 1988], 250 PHIL 193-205)
LABOR RELATIONS; COLLECTIVE BARGAINING UNIT; ELUCIDATED. — A bargaining unit is "a group of employees of a given
employer, comprised of all or less than all of the entire body of employees, consistent with equity to the employer, indicate to be
the best suited to serve the reciprocal rights and duties of the parties under the collective bargaining provisions of the law." The
factors in determining the appropriate collective bargaining unit are (1) the will of the employees (Globe Doctrine); (2) affinity
and unity of the employees' interest, such as substantial similarity of work and duties, or similarity of compensation and working
conditions (Substantial Mutual Interests Rule); (3) prior collective bargaining history; and (4) similarity of employment status. The
basic test of an asserted bargaining unit's acceptability is whether or not it is fundamentally the combination which will best
assure to all employees the exercise of their collective bargaining rights.
(International School Alliance of Educators v. Quisumbing, G.R. No. 128845, [June 1, 2000], 388 PHIL 661-678)
Bargaining Unit
The concepts of a union and of a legitimate labor organization are different from, but related to, the concept of a bargaining unit.
We explained the concept of a bargaining unit in San Miguel Corporation v. Laguesma, 8 where we stated that:
A bargaining unit is a "group of employees of a given employer, comprised of all or less than all of the entire body of employees,
consistent with equity to the employer, indicated to be the best suited to serve the reciprocal rights and duties of the parties
under the collective bargaining provisions of the law".

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The fundamental factors in determining the appropriate collective bargaining unit are: (1) the will of the employees (Globe
Doctrine); (2) affinity and unity of the employees' interest, such as substantial similarity of work and duties, or similarity of
compensation and working conditions (Substantial Mutual Interests Rule); (3) prior collective bargaining history; and (4) similarity
of employment status.
Contrary to petitioner's assertion, this Court has categorically ruled that the existence of a prior collective bargaining history
is neither decisive nor conclusive in the determination of what constitutes an appropriate bargaining unit.
However, employees in two corporations cannot be treated as a single bargaining unit even if the businesses of the two
corporations are related. 9
(Sta. Lucia Commercial Corp. v. Secretary of Labor and Employment, G.R. No. 162355, [August 14, 2009], 612 PHIL 998-1009)

B. DETERMINATION OF APPROPRIATE BARGAINING UNIT


1. Factors – Unit Determination
a. In General
Cases:
COLLECTIVE BARGAINING UNIT; NO SPECIFIC GUIDELINE FOR DETERMINATION THEREOF. — Our labor laws do not however
provide the criteria for determining the proper collective bargaining unit. Apart from the single descriptive word "appropriate,"
in Section 12 of the Industrial Peace Act which was subsequently incorporated into the Labor Code with minor changes, no
specific guide for determining the proper collective bargaining unit can be found in the statutes. Case law fortunately furnishes
some guidelines.
MUTUALITY OF INTEREST TEST; BASIC TEST IN THE DETERMINATION OF THE APPROPRIATE BARGAINING UNIT. — The basic test in
determining the appropriate bargaining unit is that a unit, to be appropriate, must affect a grouping of employees who have
substantial, mutual interests in wages, hours, working conditions and other subjects of collective bargaining (citing Smith on
Labor Laws, 316-317; Francisco, Labor Laws, 162). . . . The Court further explained that "(t)he test of the grouping is community
or mutuality of interests. And this is so because the basic test of an asserted bargaining unit's acceptability is whether or not it is
fundamentally the combination which will best assure to all employees the exercise of their collective bargaining rights'
(Rothenberg on Labor Relations, 490)."
(University of the Phils. v. Ferrer-Calleja, G.R. No. 96189, [July 14, 1992])

b. History
Cases:
The fundamental factors in determining the appropriate collective bargaining unit are: (1) the will of the employees (Globe
Doctrine); 6 (2) affinity and unity of the employees' interest, such as substantial similarity of work and duties, or similarity of
compensation and working conditions (Substantial Mutual Interests Rule); (3) prior collective bargaining history; and (4) similarity
of employment status.
Contrary to petitioner's assertion, this Court has categorically ruled that the existence of a prior collective bargaining history is
neither decisive nor conclusive in the determination of what constitutes an appropriate bargaining unit.
(San Miguel Corp. v. Laguesma, G.R. No. 100485, [September 21, 1994])

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c. Geography
Cases:
ABSENCE OF MUTUALITY OF INTERESTS NEGATES FORMATION OF A SINGLE COLLECTIVE BARGAINING UNIT; CASE AT BAR. — In
the case at bar, the University employees may quite easily be categorized into two general classes: one, the group composed of
employees whose functions are non-academic, i.e., janitors, messengers, typists, clerks, receptionists, carpenters, electricians,
ground-keepers, chauffeurs, mechanics, plumbers; and two, the group made up of those performing academic functions, i.e., full
professors, associate professors, assistant professors, instructors — who may be judges or government executives — and
research, extension and professional staff. Not much reflection is needed to perceive that the community or mutuality of
interests which justifies the formation of a single collective bargaining unit is wanting between the academic and non-academic
personnel of the university. It would seem obvious that teachers would find very little in common with the University clerks and
other non-academic employees as regards responsibilities and functions, working conditions, compensation rates, social life and
interests, skills and intellectual pursuits, cultural activities, etc. On the contrary, the dichotomy of interests, the dissimilarity in
the nature of the work and duties as well as in the compensation and working conditions of the academic and non-academic
personnel dictate the separation of these two categories of employees for purposes of collective bargaining. The formation of
two separate bargaining units, the first consisting of the rank-and-file non-academic personnel, and the second, of the rank-and-
file academic employees, is the set-up that will best assure to all the employees the exercise of their collective bargaining rights.
These special circumstances, i.e., the dichotomy of interests and concerns as well as the dissimilarity in the nature and conditions
of work, wages and compensation between the academic and non-academic personnel, bring the case at bar within the
exception contemplated in Section 9 of Executive Order No. 180.|||
(University of the Phils. v. Ferrer-Calleja, G.R. No. 96189, [July 14, 1992])

d. Corporate Entities
Cases:
COMMERCIAL LAW; CORPORATION LAW; DOCTRINE OF PIERCING THE VEIL OF CORPORATE ENTITY; EXPLAINED. — Under the
doctrine of piercing the veil of corporate entity, when valid grounds therefore exist, the legal fiction that a corporation is an
entity with a juridical personality separate and distinct from its members or stockholders may be disregarded. In such cases, the
corporation will be considered as a mere association of persons. The members or stockholders or the corporation will be
considered as the corporation, that is liability will attach directly to the officers and stockholders. The doctrine applies when the
corporate fiction is used to defeat public convenience, justify wrong, protect fraud, or defend crime, or when it is made as a
shield to confuse the legitimate issues, or where a corporation is the mere alter ego or business conduit of a person, or where
the corporation is so organized and controlled and its affairs are so conducted as to make it merely an instrumentality, agency,
conduit or adjunct of another corporation. (Umali et al. v. Court of Appeals, G.R. No. 89561, September 13, 1990, 189 SCRA 529,
542)
NOT APPLICABLE IN CASE AT BAR. — In the case at bar, petitioner seeks to pierce the veil of corporate entity of Acrylic, alleging
that the creation of the corporation is a devise to evade the application of the CBA between petitioner Union and private
respondent Company. While we do not discount the possibility of the similarities of the businesses of private respondent and
Acrylic, neither are we inclined to apply the doctrine invoked by petitioner in granting the relief sought. The fact that the
businesses of private respondent and Acrylic are related, that some of the employees of the private respondent are the same
persons manning and providing for auxiliary services to the units of Acrylic, and that the physical plants, offices and facilities are
situated in the same compound, it is our considered opinion that these facts are not sufficient to justify the piercing of the
corporate veil of Acrylic. In the same case of Umali, et al. v. Court of Appeals (189 SCRA 529), We already emphasized that "the
legal corporate entity is disregarded only if it is sought to hold the officers and stockholders directly liable for a corporate debt or
obligation." In the instant case, petitioner does not seek to impose a claim against the members of the Acrylic. Furthermore, We
already ruled in the case of Diatagon Labor Federation Local 110 of the ULGWP v. Ople (supra) that it is grave abuse of discretion
to treat two companies as a single bargaining unit when these companies are indubitably distinct entities with separate juridical
personalities. Hence, the Acrylic not being an extension or expansion of private respondent, the rank-and-file employees working

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at Acrylic should not be recognized as part of, and/or within the scope of the petitioner, as the bargaining representative of
private respondent.
(Indophil Textile Mill Workers Union-PTGWO v. Calica, G.R. No. 96490, [February 3, 1992])
EMPLOYMENT; TRANSFORMATION OF COMPANIES, MANAGEMENT PREROGATIVE AND BUSINESS JUDGMENT. — Undeniably the
transformation of the companies was a management prerogative and business judgment which the courts can not look into
unless it is contrary to law, public policy or morals. Neither can we impute any bad faith on the part of SMC so as to justify the
application of the doctrine of piercing the corporate veil.
(San Miguel Corp. Employees Union v. Confesor, G.R. No. 111262, [September 19, 1996], 330 PHIL 628-652)

e. Management
Cases:
EXCLUSIVE CONCERN OF LABOR AND EMPLOYER DEFINITELY AN INTRUDER. — This Court's disapprobation of management
interference in certification elections is even more forceful in Consolidated Farms, Inc. v. Noriel, where we held: "On a matter
that should be the exclusive concern of labor, the choice of a collective bargaining representative, the employer is definitely an
intruder. His participation, to say the least, deserves no encouragement. This Court should be the last agency to lend support to
such an attempt at interference with a purely internal affair of labor."
EMPLOYERS, THOUGH NOTIFIED OF PETITION, ARE NOT CONSIDERED PARTIES THERETO. — The three security agencies should
not even be adverse parties in the certification election itself. We note with disapproval the title given to the petition for
certification election of the Union by the Med-Arbiter and the Secretary of Labor naming the three security agencies as
respondents. Such is clearly an error. While employers may rightfully be notified or informed of petitions of such nature, they
should not, however, be considered parties thereto with concomitant right to oppose it. Sound policy dictates that they should
maintain a strictly hands-off policy.
(Philippine Scout Veterans Security and Investigation Agency v. Torres, G.R. No. 92357, [July 21, 1993])

f. Test to Determine Bargaining Unit


Cases:
A bargaining unit is a "group of employees of a given employer, comprised of all or less than all of the entire body of employees,
consistent with equity to the employer, indicate to be the best suited to serve the reciprocal rights and duties of the parties
under the collective bargaining provisions of the law."
The fundamental factors in determining the appropriate collective bargaining unit are: (1) the will of the employees (Globe
Doctrine); (2) affinity and unity of the employees' interest, such as substantial similarity of work and duties, or similarity of
compensation and working conditions (Substantial Mutual Interests Rule); (3) prior collective bargaining history; and (4) similarity
of employment status.
Contrary to petitioner's assertion, this Court has categorically ruled that the existence of a prior collective bargaining history is
neither decisive nor conclusive in the determination of what constitutes an appropriate bargaining unit.
Indeed, the test of grouping is mutuality or commonality of interests. The employees sought to be represented by the collective
bargaining agent must have substantial mutual interests in terms of employment and working conditions as evinced by the type
of work they perform.
(San Miguel Corp. v. Laguesma, G.R. No. 100485, [September 21, 1994])
LABOR AND OTHER SOCIAL LEGISLATION; RIGHT TO SELF-ORGANIZATION AND COLLECTIVE BARGAINING; BARGAINING UNIT,
DEFINED. — A bargaining unit has been defined as a group of employees of a given employer comprised of all or less than all of
the entire body of employees, which the collective interest of all the employees, consistent with equity to the employer, indicate

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to be the best suited to serve the reciprocal rights and duties of the parties under the collective bargaining provisions of the law.
The community or mutuality of interest is therefore the essential criterion in the grouping. "And this is so because 'the basic test
of an asserted bargaining unit's acceptability is whether or not it is fundamentally the combination which will best assure to all
employees the exercise of their collective bargaining rights.'"
(Golden Farms, Inc. v. Secretary of Labor, G.R. No. 102130, [July 26, 1994])
STANDARD IN DETERMINING PROPER CONSTITUENCY THEREOF; PRESENT IN CASE AT BAR. — A unit to be appropriate must
effect a grouping of employees who have substantial, mutual interests in wages, hours, working conditions and other subjects of
collective bargaining. It is readily seen that the employees in the instant case have "community or mutuality of interests," which
is the standard in determining the proper constituency of a collective bargaining unit. It is undisputed that they all belong to the
Magnolia Poultry Division of San Miguel Corporation. This means that, although they belong to three different plants, they
perform work of the same nature, receive the same wages and compensation, and most importantly, share a common stake in
concerted activities. The fact that the three plants are located in three different places, namely, in Cabuyao, Laguna, in Otis,
Pandacan, Metro Manila, and in San Fernando, Pampanga is immaterial. Geographical location can be completely disregarded if
the communal or mutual interests of the employees are not sacrificed. The distance among the three plants is not productive of
insurmountable difficulties in the administration of union affairs. Neither are there regional differences that are likely to impede
the operations of a single bargaining representative.
(San Miguel Corp. Supervisors and Exempt Union v. Laguesma, G.R. No. 110399, [August 15, 1997], 343 PHIL 143-155)

g. Unit Severance and Globe Doctrine


Cases:
LABOR AND SOCIAL LEGISLATION; INDUSTRIAL PEACE ACT; LABOR UNION; FORMATION AND SEPARATION OF BARGAINING UNIT;
APPLICATION OF GLOBE DOCTRINE IS PREMATURE. — Under the "Globe doctrine" (Globe Machine & Stamping Co., 3 NLRB 294)
applied in Democratic Labor Union vs. Cebu Stevedoring Co., L-10321, 28 February 1958, bargaining units may be formed through
separation of new units from existing ones whenever plebiscites had shown the workers' desire to have their own
representatives. In the case at bar, the appeal of the Mechanical Department Labor Union, questioning the applicability under
the circumstances of the Globe doctrine of considering the will of the employees in determining what union should represent
them, is premature, since the result of the ordered plebiscite among the workers of the Caloocan Shops (who desire to form a
new bargaining unit) may be adverse to the formation of a separate unit, in which event, all questions raised in this case would
be rendered moot and academic.
ESTABLISHMENT OF NEW AND SEPARATE BARGAINING UNIT IN ONE DEPARTMENT OF THE SAME COMPANY. — Appellant
contends that the application of the "Globe doctrine" is not warranted because the workers of the Caloocan Shops (one of the
four main divisions or units of the Mechanical Department of the PNR) do not require different skills from the rest of the workers
in the Mechanical Department of the Railway Company. This question is primarily one of fact. The Industrial Court has found that
there is a basic difference, in that those in the Caloocan shops not only have a community of interest and working conditions but
perform major repairs of railway rolling stock, using heavy equipment and machineries found in said ships, while the others only
perform minor repairs. It is easy to understand, therefore, that the workers in the Caloocan shops require special skill in the use
of heavy equipment and machinery sufficient to set them apart from the rest of the workers. In addition, the record shows that
the collective bargaining agreements negotiated by the appellant union have been in existence for more than two (2) years;
hence, such agreements can not constitute a bar to the determination, by proper elections, of a new bargaining representative.
(Mech. Dept. Labor Union v. Court of Industrial Relations, G.R. No. L-28223, [August 30, 1968], 133 PHIL 970-977)

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2. Size of Unit and Effect on Self-Organization


a. Unit Scope and Self-Organization
Cases:
As stated for the Court by the now Chief Justice in AG & P Co. of Manila, Inc. vs. C.I.R., 8 section 3 of the Industrial Peace Act
"explicitly provides that 'employees' — and this term includes supervisors — 'shall have the right to self-organization, and to
form, join or assist labor organizations of their own choosing for the purpose of collective bargaining through representations of
their own choosing and to engage in concerted activities for the purpose of collective bargaining and other mutual aid or
protection' and that 'individuals employed as supervisors . . . may form separate organizations of their own'. Indeed, it is well
settled that 'in relation to his employer,' a foreman or supervisor 'is an employee within the meaning of the Act' . . . For this
reason, supervisors are entitled to engage in union activities and any discrimination against them by reason thereof constitutes
an unfair labor practice."
Petitioner's arguments go in reality to the wisdom and policy of the Industrial Peace Act which expressly grants supervisors the
right to organize and bargain collectively, which are beyond the Court's power of review. Thus, the argument that "it is axiomatic
in the law of self-interest that an employer must give a 'better deal' to those who act in his interest and in whom he has trust and
confidence. These are the supervisors and confidential employees" 9 and that "In the United States there was a move to have a
part of the supervisory group to be aligned with labor But the enactment of the Taft-Hartley Act put an end to this move." 10
So with petitioner's thesis that "(T)o then give supervisors the right to compel employers to bargain would in effect align labor
and management together against stockholders and bondholders (capital) and inexorably tilt the balance of power in favor of
these hitherto conflicting forces. This is contrary to the nature and philosophy of free enterprise." 11 This further serves to point
up the validity and rationale of the Industrial Peace Act's provision, since the supervisors and confidential employees, even
though they may exercise the prerogatives of management as regards the rank and file employees are indeed employees in
relation to their employer, the company which is owned by the "stockholders and bondholders (capital)" in petitioner's own
words, and should therefore be entitled under the law to bargain collectively with the top management with respect to their
terms and conditions of employment.
(Filoil Refinery Corp. v. Filoil Supervisory & Confidential Employees Ass'n., G.R. No. L-26736, [August 18, 1972], 150-B PHIL 408-
419)

b. Supervisor Unit
Cases:
Indeed, the Court of Appeals cannot be expected to go over the list of alleged supervisory employees attached to the petition
before it and to pass judgment in the first instance on the nature of the functions of each employee on the basis of the job
description pertaining to him. As appropriately observed by the said court, the determination of such factual issues is vested in
the appropriate Regional Office of the Department of Labor and Employment and pursuant to the doctrine of primary
jurisdiction, the Court should refrain from resolving such controversies. The doctrine of primary jurisdiction does not warrant a
court to arrogate unto itself the authority to resolve a controversy the jurisdiction over which is initially lodged with an
administrative body of special competence. 9
The petitioner questions the remedy suggested by the Court of Appeals i.e., to file a petition for cancellation of registration
before the appropriate Regional Office arguing that the membership of supervisory employees in the rank-and-file is not one of
the grounds for cancellation of registration under the Omnibus Rules. Whether the inclusion of the prohibited mix of rank-and-
file and supervisory employees in the roster of officers and members of the union can be cured by cancellation of registration
under Article 238 et seq. of the Labor Code vis-à-vis Rule VIII of the Omnibus Rules, or by simple inclusion-exclusion proceedings
in the pre-election conference, 10 the fact remains that the determination of whether there are indeed supervisory employees in
the roster of members of the rank-and-file union has never been raised nor resolved by the appropriate fact finding body, and
the petition for certiorari filed in the Court of Appeals cannot cure the procedural lapse. It bears notice that unlike in Toyota
Motor Philippines Corp. vs. Toyota Motor Philippines Corp. Labor Union 11 where the objection that "the union was composed of
both rank-and-file and supervisory employees in violation of law" was promptly raised in the position paper to oppose the

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petition for certification election, and this objection was resolved by the Med-Arbiter, this issue was belatedly raised in the case
at bar and was sought to be ventilated only before the Court of Appeals in the petition for certiorari. Time and again, this Court
has ruled that factual matters are not proper subjects for certiorari.
(Negros Oriental Electric Coop. 1 v. Sec. of DOLE, G.R. No. 143616, [May 9, 2001], 409 PHIL 767-780)

3. Effect of Prior Agreements


a. Non-Parties
Cases:
Petitioner, in justification of its action, maintained that the exclusion of the members of the private respondent from the
bargaining union of the rank-and-file or from forming their own union was agreed upon by petitioner corporation with the
previous bargaining representatives namely: the General "Rubber Workers Union-PTGWO, the General Workers Union-NAFLU
and the General Rubber Workers Union (independent). Such posture has no leg to stand on. It has not been shown that private
respondent was privy to this agreement. And even if it were so, it can never bind subsequent federations and unions particularly
private respondent-union because it is a curtailment of the right to self-organization guaranteed by the labor laws. However, to
prevent any difficulty and to avoid confusion to all concerned and, more importantly, to fulfill the policy of the New Labor Code
as well as to be consistent with Our ruling in the Bulletin case, supra, the monthly-paid rank-and-file employees should be
allowed to join the union of the daily-paid-rank-and-file employees of petitioner so that they can also avail of the CBA benefits or
to form their own rank-and-file union, without prejudice to the certification election that has been ordered. cdll|||
(General Rubber and Footwear Corp. v. Bureau of Labor Relations, G.R. No. 74262, [October 29, 1987], 239 PHIL 276-282)

The University's arguments on the first issue fail to impress us. The Court agrees with the Solicitor General that the express
exclusion of the computer operators and discipline officers from the bargaining unit of rank-and-file employees in the 1986
collective bargaining agreement does not bar any re-negotiation for the future inclusion of the said employees in the bargaining
unit. During the freedom period, the parties may not only renew the existing collective bargaining agreement but may also
propose and discuss modifications or amendments thereto. With regard to the alleged confidential nature of the said employees’
functions, after a careful consideration of the pleadings filed before this Court, we rule that the said computer operators and
discipline officers are not confidential employees. As carefully examined by the Solicitor General, the service record of a
computer operator reveals that his duties are basically clerical and non-confidential in nature. 52 As to the discipline officers, we
agree with the voluntary arbitrator that based on the nature of their duties, they are not confidential employees and should
therefore be included in the bargaining unit of rank-and-file employees.
The Court also affirms the findings of the voluntary arbitrator that the employees of the College of St. Benilde should be excluded
from the bargaining unit of the rank-and-file employees of Dela Salle University, because the two educational institutions have
their own separate juridical personality and no sufficient evidence was shown to justify the piercing of the veil of corporate
fiction.
(DLSU v. DLSU Employees Association, G.R. No. 109002, 110072, [April 12, 2000])

4. Determining Agency
Article. 226. Bureau of Labor Relations. - The Bureau of Labor Relations and the Labor Relations Divisions in the regional
offices of the Department of Labor, shall have original and exclusive authority to act, at their own initiative or upon request
of either or both parties, on all inter-union and intra-union conflicts, and all disputes, grievances or problems arising from or
affecting labor-management relations in all workplaces, whether agricultural or non-agricultural, except those arising from
the implementation or interpretation of collective bargaining agreements which shall be the subject of grievance procedure
and/or voluntary arbitration.

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The Bureau shall have fifteen (15) working days to act on labor cases before it, subject to extension by agreement of the
parties.
Article 255. Exclusive bargaining representation and workers participation in policy and decision-making. “ The labor
organization designated or selected by the majority of the employees in an appropriate collective bargaining unit shall be the
exclusive representative of the employees in such unit for the purpose of collective bargaining. However, an individual
employee or group of employees shall have the right at any time to present grievances to their employer.
Any provision of law to the contrary notwithstanding, workers shall have the right, subject to such rules and regulations as
the Secretary of Labor and Employment may promulgate, to participate in policy and decision-making processes of the
establishment where they are employed insofar as said processes will directly affect their rights, benefits and welfare. For
this purpose, workers and employers may form labor-management councils: Provided, That the representatives of the
workers in such labor-management councils shall be elected by at least the majority of all employees in said establishment.

a. Agency and Finality Order


Cases:
COURT OF INDUSTRIAL RELATIONS; WIDE DISCRETION IN ADOPTING PROCEDURE TO DETERMINE APPROPRIATE BARGAINING
UNIT. — The industrial court enjoys a wide discretion in determining the procedure necessary to insure the fair and free choice of
bargaining representations by employees, and that its action in deciding upon an appropriate unit for collective bargaining
purposes is discretionary and its judgment in this respect is entitled to almost complete finality, unless its action is arbitrary or
capricious.|||
(Filoil Refinery Corp. v. Filoil Supervisory & Confidential Employees Ass'n., G.R. No. L-26736, [August 18, 1972], 150-B PHIL 408-
419)

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PART FIVE – UNION REPRESENTATION: ESTABLISING UNION MAJORITY STATUS


A. PRE-CONDITION – EMPLOYER-EMPLOYEE RELATIONSHIP
Election – Pre-requisite
Cases:
LABOR; EMPLOYEE-EMPLOYEE RELATIONSHIP; ELEMENTS TO BE CONSIDERED IN DETERMINING RELATIONSHIP. — In determining
the existence of employer-employee relationship, the following elements are generally considered, namely: (1) the selection and
engagement of the employees; (2) the payment of wages; (3) the power of dismissal; and (4) the power to control the
employee's conduct — although the latter is the most important element (35 Am. Jur. 445). The clear implication is that if the
defendant has no power of "control" — which, is the most important element — there is no employer-employee relationship.
CASE AT BAR. — There is no direct employment relationship between MARITIMA and the laborers. The latter have no separate,
individual contracts with MARITIMA. In fact, the court a quo found that it was AFWU that hired them. Their only possible
connection with MARITIMA is through AFWU which contracted with the latter. Hence, they could not possibly be in a better class
than AFWU which dealt with MARITIMA (Cruz vs. Manila Hotel, 101 Phil. 353; Chuan & Sons vs. CIR, 85 Phil., 365). The facts as
found by the court a quo strongly indicate that it is AFWU itself who is the "employer" of those laborers. The facts very succinctly
show that it was AFWU, through its officers, which (1) selected and hired the laborers, (2) paid their wages, (3) exercised control
and supervision over them, and (4) had the power to discipline and dismiss them. These are the very elements constituting an
employer-employee relationship (Viana vs. Al Lagadan, G.R. No. L-8967, May 31, 1956; 99 Phil., 408).
(Allied Free Workers' Union v. Compania Maritima, G.R. Nos. L-22951 and L-22952, L22971, [January 31, 1967])

B. METHODS OF ESTABLISHING MAJORITY STATUS


1. Elections – Certification and Consent Election; Consent Election; and Run-off Election
BVRIS1(h);(ss);
(h) "Certification Election" or "Consent Election" refers to the process of determining through secret ballot the sole and
exclusive representative of the employees in an appropriate bargaining unit for purposes of collective bargaining or
negotiation. A certification election is ordered by the Department, while a consent election is voluntarily agreed upon by the
parties, with or without the intervention by the Department.
(ss) “Run-off Election” refers to an election between the labor unions receiving the two (2) highest number of votes in a
certification or consent election with three (3) or more choices, where such a certified or consent results in none of the three
(3) or more choices receiving the majority of the valid votes cast; provided that the total number of votes for all contending
unions is at least fifty percent (50%) of the number of votes cast.

Cases:
A certification election is the process of determining the sole and exclusive bargaining agent of the employees in an appropriate
bargaining unit for purposes of collective bargaining. Collective bargaining, refers to the negotiated contract between a
legitimate labor organization and the employer concerning wages, hours of work and all other terms and conditions of
employment in a bargaining unit.
The significance of an employee's right to vote in a certification election cannot thus be overemphasized. For he has considerable
interest in the determination of who shall represent him in negotiating the terms and conditions of his employment.
As to whether HIMPHLU should be certified as the exclusive bargaining agent, the Court rules in the negative. It is well-settled
that under the so-called "double majority rule", for there to be a valid certification election, majority of the bargaining unit must
have voted AND the winning union must have garnered majority of the valid votes cast.

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It bears reiteration that the true importance of ascertaining the number of valid votes cast is for it to serve as basis for computing
the required majority, and not just to determine which union won the elections. The opening of the segregated but valid votes
has thus become material. To be sure, the conduct of a certification election has a two-fold objective: to determine the
appropriate bargaining unit and to ascertain the majority representation of the bargaining representative, if the employees
desire to be represented at all by anyone. It is not simply the determination of who between two or more contending unions
won, but whether it effectively ascertains the will of the members of the bargaining unit as to whether they want to be
represented and which union they want to represent them
A run-off election refers to an election between the labor unions receiving the two (2) highest number of votes in a certification
or consent election with three (3) or more choices, where such a certified or consent election results in none of the three (3) or
more choices receiving the majority of the valid votes cast; provided that the total number of votes for all contending unions is at
least fifty percent (50%) of the number of votes cast. 8 With 346 votes cast, 337 of which are now deemed valid and HIMPHLU
having only garnered 169 and petitioner having obtained 151 and the choice "NO UNION" receiving 1 vote, then the holding of a
run-off election between HIMPHLU and petitioner is in order.
(NUWHRAIN-Manila Pavilion Hotel Chapter v. Secretary of Labor and Employment, G.R. No. 181531, [July 31, 2009], 612 PHIL
291-306)

2. Distinctions – Certification and Consent Elections


Cases:
CONSENT ELECTION DISTINGUISHED FROM CERTIFICATION ELECTION. — As correctly distinguished by private respondent, a
consent election is an agreed one, its purpose being merely to determine the issue of majority representation of all the workers
in the appropriate collective bargaining unit while a certification election is aimed at determining the sole and exclusive
bargaining agent of all the employees in an appropriate bargaining unit for the purpose of collective bargaining. From the very
nature of consent election, it is a separate and distinct process and has nothing to do with the import and effect of a certification
election. Neither does it shorten the terms of an existing CBA nor entitle the participants thereof to immediately renegotiate an
existing CBA although it does not preclude the workers from exercising their right to choose their sole and exclusive bargaining
representative after the expiration of the sixty (60) day freedom period
(Warren Manufacturing Workers Union v. Bureau of Labor Relations, G.R. No. 76185, [March 30, 1988])

3. Consent Elections
Cases:
To resolve the issue of union representation at the Universal Robina Textile plant, what was agreed to be held at the company's
premises and which became the root of this controversy, was a consent election, not a certification election.
It is unmistakable that the election held on November 15, 1990 was a consent election and not a certification election. It was an
agreed one, the purpose being merely to determine the issue of majority representation of all the workers in the appropriate
collective bargaining unit. It is a separate and distinct process and has nothing to do with the import and effort of a certification
election.
(Algire v. De Mesa, G.R. No. 97622, [October 19, 1994])

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4. Major Policies
a. Union Voluntary Recognition
Cases:
LABOR LAW; LABOR RELATIONS; CERTIFICATION ELECTION; A COMPANY DOES NOT HAVE THE POWER TO DECLARE A UNION AS
EXCLUSIVE REPRESENTATIVE OF THE WORKERS FOR PURPOSE OF COLLECTIVE BARGAINING. — The case of Ilaw ng Buklod ng
Manggagawa v. Ferrer-Calleja, cited by the Solicitor General in his comment filed in behalf of the NLRC, is particularly apropos.
There, the union also requested voluntary recognition by the company. Instead of granting the request, the company petitioned
for a certification election. The union moved to dismiss on the ground that it did not ask the company to bargain collectively with
it. As its motion was denied, the union brought the matter to this Court. In sustaining the company's stand, this Court ruled: . . .
Ordinarily, in an unorganized establishment like the Calasiao Beer Region, it is the union that files, a petition for a certification
election if there is no certified bargaining agent for the workers in the establishment. If a union asks the employer to voluntarily
recognize it as the bargaining agent of the employees, as the petitioner did, it in effect asks the employer to certify it as the
bargaining representative of the employees — A CERTIFICATION WHICH THE EMPLOYER HAS NO AUTHORITY TO GIVE, for it is the
employees' prerogative (not the employer's) to determine whether they want a union to represent them, and, if so, which one it
should be. In accordance with this ruling, Permex Producer should not have given its voluntary recognition to SMP-PIILU-TUCP
when the latter asked for recognition as exclusive collective bargaining agent of the employees of the company. The company did
not have the power to declare the union the exclusive representative of the workers for the purpose of collective bargaining.|||
(Samahang Manggagawa sa Permex v. Secretary of Labor, G.R. No. 107792, [March 2, 1998], 350 PHIL 342-349)

b. Law
Cases:
DUTY TO BARGAIN COLLECTIVELY, IMBUED WITH PUBLIC INTEREST. — The Labor Code imposes upon the employer and the
representative of the employees the duty to bargain collectively. Since the question of right of representation as between
competing labor organizations in a bargaining unit is imbued with public interest, the law governs the choice of a collective
bargaining representative which shall be the duly certified agent of the employees concerned.
HOW DETERMINED. — An official certification becomes necessary where the bargaining agent fails to present adequate and
reasonable proof of its majority authorization and where the employer demands it, or when the employer honestly doubts the
majority representation of several contending bargaining groups. In fact, Article 255 of the Labor Code allows the majority of the
employees in an appropriate collective bargaining unit to designate or select the labor organization which shall be their exclusive
representative for the purpose of collective bargaining. The designation or selection of the bargaining representative for the
purpose of collective bargaining. The designation or selection of the bargaining representative without, however, going through
the process set out by law for the conduct of a certification election applies only when representation is not in issue. There is
problem if a union is unanimously chosen by a majority of the employees as their bargaining representative, but a question of
representation arising from the presence of more than one union in a bargaining unit aspiring to be the employees'
representative, can only be resolved by holding a certification election by one of the two unions in the bargaining unit is enough
basis for the DOLE, through its authorized official, to implement the law by directing the conduct of a certification election.
(Oriental Tin Can Labor Union v. Sec. of Labor and Employment, G.R. No. 116751, 116779, [August 28, 1998])

c. No Direct Certification
Cases:
Even in a case where a union has filed a petition for certification elections, the mere fact that no opposition is made does not
warrant a direct certification. More so as in the case at bar, when the records of the suit show that the required proof was not
presented in an appropriate proceeding and that the basis of the direct certification was the Union's mere allegation in its
position paper that it has 87 out of 117 regular salesmen. In other words, respondent Minister merely relied on the self-serving

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assertion of the respondent Union that it enjoyed the support of the majority of the salesmen, without subjecting such assertion
to the test of competing claims.
(Colgate Palmolive Phils., Inc. v. Ople, G.R. No. 73681, [June 30, 1988], 246 PHIL 331-339)

d. One Company – One Union Policy


*NO LONGER APPLICABLE!!!

e. Policy Consideration
Cases:
LABOR LAW; CERTIFICATION ELECTION; HOLDING THEREOF BASED ON STATUTORY POLICY. — The Court has repeatedly stressed
that the holding of a certification election is based on a statutory policy that 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]). The workers must be allowed to freely express their choice in a determination
where everything is open to their sound judgment and the possibility of fraud and misrepresentation is eliminated.
UNION AFFILIATION WITH FEDERATION; DOCUMENTARY REQUIREMENTS MUST BE COMPLIED WITH BY LOCAL OR CHAPTER. —
In the case of union affiliation with a federation, the documentary requirements are found in Rule II, Section 3(e), Book V of the
Implementing Rules. Since the "procedure governing the reporting of independently registered unions" refers to the certification
and 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 case of union affiliation. Moreover,
there is greater reason to exact compliance with the certification and attestation requirements because, as previously
mentioned, several requirements applicable to independent union registration are no longer required in the case of the
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 commission of fraud.
(Progressive Development Corp. v. Secretary of DOLE, G.R. No. 96425, [February 4, 1992])

Effect of Receipt of Benefits


Cases:
RECEIPT BY SUBJECT EMPLOYEES OF CERTAIN BENEFITS UNDER THE CBA IS NOT SUFFICIENT TO DENY THE PETITION FOR
CERTIFICATION ELECTION. — The receipt by petitioner's "supervisor" employees of certain benefits under the CBA between
BUKLOD and petitioner is not sufficient to deny the petition for certification election filed by the labor organization formed by
the excluded employees. It is not equivalent to and does not compensate for the denial of the right of the excluded employees to
self-organization and collective bargaining.
(Barbizon Philippines, Inc. v. Nagkakaisang Supervisor ng Barbizon Philippines, Inc.-NAFLU, G.R. Nos. 113204-05, [September 16,
1996], 330 PHIL 472-493)

f. Religion/Past Non-Participation
Cases:
LABOR LAW; EMPLOYEE'S RIGHT TO SELF-ORGANIZATION; GUARANTEED BY THE LABOR CODE. — Guaranteed to all employees or
workers is the "right to self-organization and to form, join, or assist labor organizations of their own choosing for purposes of
collective bargaining." This is made plain by no less than three provisions of the Labor Code of the Philippines. [As amended inter

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alia by R.A. Nos. 6715, 6725 AND 6727] Article 243 of the Code provides as follows: ART. 243.Coverage and employees right to
self-organization. — All persons employed in commercial, industrial and agricultural enterprises and in religious, charitable,
medical, or educational institutions whether operating for profit or not, shall have the right to self-organization and to form, join,
or assist labor organizations of their own choosing for purposes of collective bargaining. Ambulant, intermittent and itinerant
workers, self-employed people, rural workers and those without any definite employers may form labor organizations for their
mutual aid and protection. Article 248 (a) declares it to be an unfair labor practice for an employer, among others, to "interfere
with, restrain or coerce employees in the exercise of their right to self-organization." Similarly, Article 249 (a) makes it an unfair
labor practice for a labor organization to "restrain or coerce employees in the exercise of their rights to self-organization . . . ."
The same legal proposition is set out in the Omnibus Rules Implementing the Labor Code, as amended, as might be expected.
Section 1, Rule II (Registration of Unions), Book V (Labor Relations) of the Omnibus Rules provides as follows: "SEC. 1. Who may
join unions; exception. — All persons employed in commercial, industrial and agricultural enterprises, including employees of
government corporations established under the Corporation Code as well as employees of religious, medical or educational
institutions, whether operating for profit or not, except managerial employees, shall have the right to self-organization and to
form, join or assist labor organizations for purposes of collective bargaining. Ambulant, intermittent and itinerant workers, self-
employed people, rural workers and those without any definite employers may form labor organizations for their mutual aid and
protection.
RIGHT TO VOTE; GRANTED TO ALL BONA FIDE EMPLOYEES IN THE BARGAINING UNIT, WHETHER MEMBERS OF A LABOR
ORGANIZATION OR NOT. — The respondents' argument that the petitioners are disqualified to vote because they "are not
constituted into a duly organized labor union" — "but members of the INK which prohibits its followers, on religious grounds,
from joining or forming any labor organization" — and "hence, not one of the unions which vied for certification as sole and
exclusive bargaining representative," is specious. Neither law, administrative rule nor jurisprudence requires that only employees
affiliated with any labor organization may take part in a certification election. On the contrary, the plainly discernible intendment
of the law is to grant the right to vote to all bona fide employees in the bargaining unit, whether they are members of a labor
organization or not. As held in Airtime Specialists, Inc. v. Ferrer-Calleja [180 SCRA 749, 754 (1989)]. "In a certification election all
rank-and-file employees in the appropriate bargaining unit are entitled to vote. This principle is clearly stated in Art. 255 of the
Labor Code which states that the 'labor organization designated or selected by the majority of the employees in an appropriate
bargaining unit shall be the exclusive representative of the employees in such unit for the purpose of collective bargaining.'
Collective bargaining covers all aspects of the employment relation and the resultant CBA negotiated by the certified union binds
all employees in the bargaining unit. Hence, all rank-and-file employees, probationary or permanent, have a substantial interest
in the selection of the bargaining representative. The Code makes no distinction as to their employment status as basis for
eligibility in supporting the petition for certification election. The law refers to 'all' the employees in the bargaining unit. All they
need to be eligible to support the petition is to belong to the 'bargaining unit.'"
NOT FORFEITED BY REASON OF NEGLECT TO EXERCISE THE SAME IN PAST CERTIFICATION ELECTIONS. — Neither does not the
contention that petitioners should be denied the right to vote because they "did not participate in previous certification elections
in the company for the reason that their religious beliefs do not allow them to form, join or assist labor organizations," persuade
acceptance. No law, administrative rule or precedent prescribes forfeiture of the right to vote by reason of neglect to exercise
the right in past certification elections. In denying the petitioners' right to vote upon these egregiously fallacious grounds, the
public respondents exercised their discretion whimsically, capriciously and oppressively and gravely abused the same.
(Reyes v. Trajano, G.R. No. 84433, [June 2, 1992])

g. Rationale
Cases:
If indeed there are employees in the bargaining unit who refuse to be represented by respondent FFW-SMQCC, with all the more
reason should a certification election be held where the employees themselves can freely and voluntarily express by secret ballot
their choice of bargaining representative. A certification election is the most effective and expeditious way to determine which
labor organization can truly represent the working force in the appropriate bargaining unit of the company.
(National Mines and Allied Workers Union v. Secretary of Labor, G.R. No. 106446, [November 16, 1993])

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h. Forum Issue
Cases:
REMEDIAL LAW; EVIDENCE; CREDIBILITY; FACTUAL FINDINGS OF QUASI-JUDICIAL AGENCIES LIKE THE DEPARTMENT OF LABOR,
GENERALLY ACCORDED RESPECT AND FINALITY ON APPEAL. — It is settled that factual findings of quasi-judicial agencies, like the
Labor Department, which have acquired expertise in matters entrusted to their jurisdiction are accorded by the Court not only
respect but finality if supported by substantial evidence. Substantial evidence refers to that amount of relevant evidence which a
reasonable mind may accept as adequate to justify a conclusion. In this case, the findings of the public respondent, particularly
those on the dates of the registration and the signing of the CBA, are supported by substantial evidence. In fact, petitioner does
not even contradict these findings.|||
ISSUE OF WHICH UNION REPRESENTS THE WORKING FORCE SHOULD BE RAISED DURING CERTIFICATION ELECTION, NOT DURING
UNION REGISTRATION PERIOD. — The issue of which union truly represents the working force should be raised during the
certification election, not during the registration period. Indeed, a certification election provides the most effective and
expeditious mode to determine the real representatives of the working force in the appropriate bargaining unit.
(Katipunan ng mga Manggagawa sa Daungan v. Ferrer-Calleja, G.R. No. 104692, [September 5, 1997], 344 PHIL 67-77)

Venue Petition
Cases:
VENUE; TOUCHES MORE THE CONVENIENCE OF PARTIES RATHER THAN SUBSTANCE OF THE CASE. — As to the third assigned
error, petitioner contends that the petition for certification election should have been filed with the regional office which has
jurisdiction over the principal office of the employer in accordance with Section 1, Rule V, Book V of the Omnibus Rules
Implementing the Labor Code. Said section provides: "Where to file. A petition for certification election shall be filed with the
Regional Office which has jurisdiction over the principal office of the Employer. The petition shall be in writing and under oath".
The word "jurisdiction" as used in said provision refers to the venue where the petition for certification must be filed. Unlike
jurisdiction, which implies the power of the court to decide a case, venue merely refers to the place where the action shall be
brought (Sulo ng Bayan, Inc. v. Intermediate Appellate Court, 72 SCRA 347 [1976]). Venue touches more the convenience of the
parties rather than the substance of the case (Consolidated Bank v. Intermediate Appellate Court, 198 SCRA 34 [1991]).
NEW RULE ON VENUE. — Unlike in the Rules governing the procedure before Regional Offices, the New Rules of Procedure of the
National Labor Relations Commission prescribes that all cases in which labor arbiters have jurisdiction should be filed in the
branch office which has territorial jurisdiction over the "workplace of the complainant/petitioner" (Rule IV, Sec. 1[a]). The NLRC
Rules defines the workplace as follows: "For purposes of venue, workplace shall be understood as the place or locality where the
employee is regularly assigned when the cause of action arose. It shall include the place where the employee is supposed to
report back after a temporary detail, assignment or travel. . . . ."
REMEDIAL LAW; SPECIAL CIVIL ACTION; CERTIORARI; FINDING OF THE MED-ARBITER THAT EMPLOYER WAS BARRED FROM
RAISING THE ISSUE OF IMPROPER VENUE, NOT A GRAVE ABUSE OF DISCRETION. — The Omnibus Rules Implementing the Labor
Code has no provision as to when an objection to improper venue may be raised. The Med-Arbiter ruled that where the
employer had appeared twice at the hearing of the petition for certification election without questioning the venue, said
employer was barred from raising the issue in the subsequent proceedings. He observed: ". . . This practice of deliberately
delaying the legal proceedings cannot be countenanced any further, otherwise, the ends of justice will forever be defeated. We
don't see any reason for the respondent to delay as it did, the proceedings of the case only to assail later on the jurisdiction of
the office. This issue could have been brought up or objected to during the initial hearing". The stance of the Med-Arbiter, that
the question of the venue in representation cases should be raised at the first hearing, was accepted by respondent
Undersecretary. We are not prepared to say that said administrative officials have gravely abused their discretion.
(Cruzvale, Inc. v. Laguesma, G.R. No. 107610, [November 25, 1994])

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C. CERTIFICATION ELECTION - PROCESS


BVRVIII: Certification Election (read IRR)
BVRIX: Conduct of Certification Election (read IRR)
1. Union as Initiating Party
Article 242. Rights of legitimate labor organizations. A legitimate labor organization shall have the right:
(a) To act as the representative of its members for the purpose of collective bargaining;
(b) To be certified as the exclusive representative of all the employees in an appropriate bargaining unit for purposes of
collective bargaining;
(c) To be furnished by the employer, upon written request, with its annual audited financial statements, including the
balance sheet and the profit and loss statement, within thirty (30) calendar days from the date of receipt of the request,
after the union has been duly recognized by the employer or certified as the sole and exclusive bargaining
representative of the employees in the bargaining unit, or within sixty (60) calendar days before the expiration of the
existing collective bargaining agreement, or during the collective bargaining negotiation;
(d) To own property, real or personal, for the use and benefit of the labor organization and its members;
(e) To sue and be sued in its registered name; and
(f) To undertake all other activities designed to benefit the organization and its members, including cooperative, housing,
welfare and other projects not contrary to law.
Notwithstanding any provision of a general or special law to the contrary, the income and the properties of legitimate labor
organizations, including grants, endowments, gifts, donations and contributions they may receive from fraternal and similar
organizations, local or foreign, which are actually, directly and exclusively used for their lawful purposes, shall be free from
taxes, duties and other assessments. The exemptions provided herein may be withdrawn only by a special law expressly
repealing this provision.
Cases:
LABOR AND SOCIAL LEGISLATION; LABOR CODE; CERTIFICATION ELECTION; GENUINE PETITION FROM A LEGITIMATE LABOR
UNION, A REQUISITE. — While Article 257 cited by the Solicitor General directs the automatic conduct of a certification election
in an unorganized establishment, it also requires, however, that the petition for certification election must be filed by a
legitimate labor organization. Article 242 enumerates the exclusive rights of a legitimate labor organization among which is the
right to be certified as the exclusive representative of all the employees in an appropriate collective bargaining unit for purposes
of collective bargaining. Article 212(h) defines a legitimate labor organization as "any labor organization duly registered with the
DOLE and includes any branch or local thereof ." The law did not reduce the Med-Arbiter to an automaton which can instantly be
set to impulse by the mere filing of a petition for certification election. He is still tasked to satisfy himself that all the conditions of
the law are met, and among the legal requirements is that the petitioning union must be a legitimate labor organization in good
standing.
REQUISITES FOR LOCAL OR CHAPTER. — A local or chapter therefore becomes a legitimate labor organization only upon
submission of the following to the BLR: "1) A charter certificate, within 30 days from its issuance by the labor federation or
national union, and 2) The constitution and by-laws, a statement on the set of officers, and the books of accounts all of which are
certified under oath by the secretary or treasurer, as the case may be, of such local or chapter, and attested to by its president.
Absent compliance with these mandatory requirements, the local or chapter does not become a legitimate labor organization."
CHAPTER POSSESSING ONLY A CHARTER CERTIFICATE, NOT A LEGITIMATE LABOR UNION; PETITION FOR CERTIFICATION
ELECTION FILED SHOULD BE DISMISSED. — The only document extant on record to establish the legitimacy of the NACUSIP-TUCP
Lopez Sugar Central Supervisory Chapter is a charter certificate and nothing else. The instant petition, at least for now, must thus
be GRANTED.
(Lopez Sugar Corp. v. Secretary of Labor and Employment, G.R. No. 93117, [August 1, 1995], 317 PHIL 1-9)

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a. Organized Establishment
Article 256. Representation Issue in Organized Establishments. - In organized establishments, when a verified
petition questioning the majority status of the incumbent bargaining agent is filed by any legitimate labor
organization including a national union or federation which has already issued a charter certificate to its local
chapter participating in the certification election or a local chapter which has been issued a charter certificate by
the national union or federation before the Department of Labor and Employment within the sixty (60)-day period
before the expiration of the collective bargaining agreement, the Med-Arbiter shall automatically order an election
by secret ballot when the verified petition is supported by the written consent of at least twenty-five percent (25%)
of all the employees in the bargaining unit to ascertain the will of the employees in the appropriate bargaining unit.
To have a valid election, at least a majority of all eligible voters in the unit must have cast their votes. The labor
union receiving the majority of the valid votes cast shall be certified as the exclusive bargaining agent of all the
workers in the unit. When an election which provides for three or more choices results in no choice receiving a
majority of the valid votes cast, a run-off election shall be conducted between the labor unions receiving the two
highest number of votes: Provided, That the total number of votes for all contending unions is at least fifty percent
(50%) of the number of votes cast. In cases where the petition was filed by a national union or federation, it shall
not be required to disclose the names of the local chapter officers and members.
At the expiration of the freedom period, the employer shall continue to recognize the majority status of the
incumbent bargaining agent where no petition for certification election is filed.
Article 253. Duty to bargain collectively when there exists a collective bargaining agreement. When there is a
collective bargaining agreement, the duty to bargain collectively shall also mean that neither party shall terminate
nor modify such agreement during its lifetime. However, either party can serve a written notice to terminate or
modify the agreement at least sixty (60) days prior to its expiration date. It shall be the duty of both parties to keep
the status quo and to continue in full force and effect the terms and conditions of the existing agreement during the
60-day period and/or until a new agreement is reached by the parties.
BVRIS1(LL)
(ll) Organized Establishment refers to an enterprise where there exists a recognized or certified sole and exclusive
bargaining agent.
Cases:
LABOR AND SOCIAL LEGISLATION; LABOR RELATIONS; CERTIFICATION ELECTION; NOT APPLICABLE TO ESTABLISHMENTS WHERE
THERE EXISTS A CERTIFIED BARGAINING AGENT. — The Court has already categorically ruled that Article 257 of the Labor Code is
applicable to unorganized labor organizations and not to establishments where there exists a certified bargaining agent which
had previously entered into a collective bargaining agreement with the management (Associated Labor Unions [ALU] v. Calleja,
G.R. No. 85085, November 6, 1989, 179 SCRA 127). Otherwise stated, the establishment concerned must have no certified
bargaining agent (Associated Labor Unions [ALU] v. Calleja, G.R. No. 82260, July 19, 1989, 175 SCRA 490). In the instant case, it is
beyond cavil that the supervisors of CMC which constitute a bargaining unit separate and distinct from that of the rank-and-file,
have no such agent, thus they correctly filed a petition for certification election thru union FFW-CALMASUCO, likewise
indubitably a legitimate labor organization.
TWENTY-FIVE PERCENT (25%) SUBSCRIPTION REQUIREMENT; IMMATERIAL THERETO; REASONS THEREFOR. — CMC's insistence
on the 25% subscription requirement, is clearly immaterial. The same has been expressly deleted by Section 24 of Republic Act
No. 6715 and is presently prescribed only in organized establishments, that is, those with existing bargaining agents. Compliance
with the said requirement need not even be established with absolute certainty. The Court has consistently ruled that "even
conceding that the statutory requirement of 30% (now 25%) of the labor force asking for a certification election had not been
strictly complied with, the Director (now the Med-Arbiter) is still empowered to order that it be held precisely for the purpose of
ascertaining which of the contending labor organizations shall be the exclusive collective bargaining agent (Atlas Free Workers
Union (AFWU-PSSLU Local v. Noriel, G.R. No. L-51905, May 26, 1981, 104 SCRA 565). The requirement then is relevant only when
it becomes mandatory to conduct a certification election. In all other instances, the discretion, according to the rulings of this
Tribunal, ought to be ordinarily exercised in favor of a petition for certification

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(California Manufacturing Corp. v. Laguesma, G.R. No. 97020, [June 8, 1992])

b. Freedom Period
Cases:
CERTIFICATION ELECTION; PROHIBITION IN FILING PETITION THEREOF; RULES; REASON THEREFOR. — The existence of a duly
registered Collective Bargaining Agreement between the petitioner and URFA, which is the sole and exclusive bargaining
representative of all the regular rank-and-file employees of the petitioner including the regular project employees with more
than one year of service, bars any other labor organization from filing a petition for certification election except within the 60-
day period prior to the expiration of the Collective Bargaining Agreement. To rule otherwise would negate the legislative intent in
the enactment of Article 232 of the Labor Code which was designed to ensure industrial peace between the employer and its
employees during the existence of the collective bargaining agreement.||| (Atlantic, Gulf and Pacific Co. of Manila, Inc. v.
Laguesma, G.R. No. 96635, [August 6, 1992])

When Applied
Cases:
CERTIFICATION ELECTION; ORGANIZED ESTABLISHMENT MUST BE FILED WITHIN FREEDOM PERIOD. — Article 256 of the Labor
Code is clear and leaves no room for interpretation. The mere filing of a petition for certification election within the freedom
period is sufficient basis for the respondent Director to order the holding of a certification election.
CONTRACT BAR RULE; WHEN APPLICABLE. — The contract bar rule is applicable only where the petition for certification election
was filed either before or after the freedom period.
CERTIFICATION ELECTION; FOAMTEX LABOR UNION-TUPAS VS. NORIEL CASE, NOT APPLICABLE TO CASE AT BAR; REASON. — Even
assuming for the sake of argument that the petitioner herein has the majority of the rank-and-file employees and that some
members of the NAFLU even renounced their membership thereat and affirmed membership with the petitioner, We cannot,
however, apply TUPAS in the case at bar. Unlike in the case of herein petitioner, in TUPAS, the petition for certification election
was filed nineteen (19) days after the CBA was signed which was well beyond the freedom period.
(Associated Labor Unions v. Ferrer-Calleja, G.R. No. 85085, [November 6, 1989], 258-A PHIL 702-712)
LABOR CODE; LABOR RELATIONS; COLLECTIVE BARGAINING AGREEMENT; APPLICABILITY OF CONTRACT BAR RULE TO CASE AT
BENCH. — Art. 253-A of the Labor Code provides that "(n)o petition questioning the majority status of the incumbent bargaining
agent shall be entertained and no certification election shall be conducted by the Department of Labor and Employment outside
of the sixty (60) day period immediately before the date of expiry of such five-year term of the collective bargaining agreement."
Sec. 3, Rule V, Book V of the Omnibus Rules Implementing the Labor Code provides that ". . . (i)f a collective bargaining
agreement has been duly registered in accordance with Article 231 of the Code, a petition for certification election or a motion
for intervention can only be entertained within sixty (60) days prior to the expiry date of such agreement." The subject
agreement was made effective 1 January 1992 and is yet to expire on 31 December 1996. The petition for certification election
having been filed on 22 April 1993 it is therefore clear that said petition must fail since it was filed before the so-called 60-day
freedom period.
(Pambansang Kapatiran ng mga Anak Pawis sa Formey Plastic National Workers Brotherhood v. Secretary of Labor, G.R. No.
111836, [February 1, 1996], 323 PHIL 116-126)

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Petition Beyond Freedom Period


Cases:
LABOR AND SOCIAL LEGISLATION; LABOR CODE; COLLECTIVE BARGAINING AGREEMENT; FILING OF PETITION FOR CERTIFICATION
ELECTION OR MOTION FOR INTERVENTION MUST BE FILED WITHIN 60 DAYS PRIOR TO EXPIRATION OF COLLECTIVE BARGAINING
AGREEMENT; RATIONALE. — The rule (Rule V, Section 6 Book V, Rules Implementing the Labor Code, as amended) simply
provides that a petition for certification election or a motion for intervention can only be entertained within sixty days prior to
the expiry date of an existing collective bargaining agreement. Otherwise put, the rule prohibits the filing of a petition for
certification election during the existence of a collective bargaining agreement except within the freedom period, as it is called,
when the said agreement is about to expire. The purpose, obviously, is to ensure stability in the relationships of the workers and
the management by preventing frequent modifications of any collective bargaining agreement earlier entered into by them in
good faith and for the stipulated original period.
(National Congress of Unions in the Sugar Industry of the Phil. v. Ferrer-Calleja, G.R. No. 89609, [January 27, 1992])

Filing Party
Cases:
PETITION THEREOF MUST BE FILED BY LEGITIMATE LABOR ORGANIZATION. — But while Article 257 cited by the Solicitor General
directs the automatic conduct of a certification election in an unorganized establishment, it also requires that the petition for
certification election must be filed by a legitimate labor organization. Article 242 enumerates the exclusive rights of a legitimate
labor organization among which is the right to be certified as the exclusive representative of all the employees in an appropriate
collective bargaining unit for purposes of collective bargaining.|||
RELATIONSHIP WITH THE MOTHER UNION; LOCAL UNION MUST FIRST COMPLY WITH STATUTORY REQUIREMENTS BEFORE
BEING CERTIFIED AS BARGAINING AGENT. — It is important to clarify the relationship between the mother union and the local
union. In the case of Liberty Cotton Mills Workers Union v. Liberty Cotton Mills, Inc., 66 SCRA 512 [1975]), the Court held that the
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 imposed by the constitution
and by-laws of the association. Thus, where as in this case the petition for certification election was filed by the federation which
is merely an agent; the petition is deemed to be filed by the chapter, the principal, which must be a legitimate labor organization.
The chapter cannot merely rely on the legitimate status of the mother union. The Court's conclusion should not be misconstrued
as impairing the local union's right to be certified as the 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 workers should take the lead in requiring their locals and chapters to faithfully comply with
the law and the rules instead of merely snapping union after union into their folds in a furious bid with rival federations to get
the most number of members.
(Progressive Development Corp. v. Secretary of DOLE, G.R. No. 96425, [February 4, 1992])
REMEDIAL LAW; SPECIAL CIVIL ACTIONS; CERTIORARI; GRAVE ABUSE OF DISCRETION; COMMITTED BY PUBLIC RESPONDENT IN
AFFIRMING MED-ARBITER'S ORDER IN SPITE OF THE FACT THAT THE UNION'S LEGITIMACY WAS PUT IN ISSUE AND THE
ALLEGATIONS OF FRAUD SUPPORTED BY EVIDENCE. — The Labor Code requires that in organized and unorganized
establishments, a petition for certification election must be filed by a legitimate labor organization. The acquisition of rights by
any union or labor organization, particularly the right to file a petition for certification election, first and foremost, depends on
whether or not the labor organization has attained the status of a legitimate labor organization. In the case before us, the Med-
Arbiter summarily disregarded the petitioner's prayer that the former look into the legitimacy of the respondent Union by a
sweeping declaration that the union was in the possession of a charter certificate so that "for all intents and purposes.
Sumasaklaw sa Manggagawa sa Pizza Hut (was) a legitimate labor organization." The grounds invoked by petitioner for the
cancellation of respondent Union's registration fall under paragraph (a) and (c) of Article 239 of the Labor Code. These grounds
constitute a grave challenge to the right of respondent Union to ask for certification election. The Med-Arbiter should have
looked into the merits of the petition for cancellation before issuing an order calling for certification election. Registration based

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on false and fraudulent statements and documents confer no legitimacy upon a labor organization irregularly recognized, which,
at best, holds on to a mere scrap of paper. Under such circumstances, the labor organization, not being a legitimate labor
organization, acquires no rights, particularly the right to ask for certification election in a bargaining unit. As we laid emphasis
in Progressive Development Corporation Labor, "[t]he employer needs the assurance that the union it is dealing with is a bona
fide organization, one which has not submitted false statements or misrepresentations to the Bureau." Clearly, fraud, falsification
and misrepresentation in obtaining recognition as a legitimate labor organization are contrary to the Med-Arbiter's conclusion
not merely collateral issues. The invalidity of respondent Union's registration would negate its legal personality to participate in
certification election. Once a labor organization attains the status of a legitimate labor organization it begins to possess all of the
rights and privileges granted by law to such organizations. As such rights and privileges ultimately affect areas which are
constitutionally protected, the activities in which labor organizations, associations and unions are engaged directly affect the
public interest and should be zealously protected. A strict enforcement of the Labor Code's requirements for the acquisition of
the status of a legitimate labor organization is in order. Inasmuch as the legal personality of respondent Union had been seriously
challenged, it would have been more prudent for the Med-Arbiter and public respondent to have granted petitioner's request for
the suspension of proceedings in the certification election case, until the issue of the legality of the Union's registration shall
have been resolved. Failure of the Med-Arbiter and public respondent to heed the request constituted a grave abuse of
discretion.|||
(Progressive Development Corp.-Pizza Hut v. Laguesma, G.R. No. 115077, [April 18, 1997], 338 PHIL 310-321)

Form of Petition
Signature Verification
Cases:
Second, verification of a pleading is a formal, not jurisdictional requisite (Buenaventura v. Uy, 149 SCRA 22 [1987]; In the Matter
of the Change of Name of Antonina B. Oshita, 19 SCRA 700 [1967]). Even if verification is lacking and the pleading is formally
defective, the courts may dispense with the requirement in the interest of justice and order the correction of the pleading
accordingly. Generally, technical and rigid rules of procedure are not binding in labor cases; and this rule is specifically applied in
certification election proceedings, which are non-litigious but merely investigative and non-adversarial in character (Associated
Labor Unions v. Ferrer-Calleja, 179 SCRA 127 [1989]; Tanduay Distillery Labor Union v. NLRC, 149 SCRA 470 [1987]). Nevertheless,
whatever formal defects existed in the first petition were cured and corrected in the second petition for certification election.
(National Mines and Allied Workers Union v. Secretary of Labor, G.R. No. 106446, [November 16, 1993])
DOUBTS AS TO THE AUTHENTICITY OF SIGNATURE OR TO THE REQUIRED PERCENTAGE DO NOT BAR HOLDING OF ELECTION. —
Any doubt cast on the authenticity of signatures to the petition for holding a certification election cannot be a bar to its being
granted (Filipino Metals Corp. v. Ople 107 SCRA 211 [1981]). Even doubts as to the required 30% being met warrant holding of
the certification election (PLUM Federation of Industrial and Agrarian Workers v. Noriel, 119 SCRA 299 [1982]). In fact, once the
required percentage requirement has been reached, the employees' withdrawal from union membership taking place after the
filing of the petition for certification election will not affect said petition. On the contrary, the presumption arises that the
withdrawal was not free but was procured through duress, coercion or for a valuable consideration.
(Belyca Corp. v. Calleja, G.R. No. 77395, [November 29, 1988], 250 PHIL 193-205)
To sustain what on its face appears to be an insubstantial claim of failure to abide by statutory command as set forth in the Labor
Code, petitioner would interpret its Article 257 of requiring that it be afforded the right to examine the alleged signatures of the
employees comprising at least the 30% of the bargaining unit desirous of holding a certification election. That is a rather strained
construction. The statutory provision reads:
"Requisites for certification election. — Any petition for certification election filed by any legitimate labor organization shall be
supported by the written consent of at least 30% of all the employees in the bargaining unit. Upon receipt and verification of
such petition, it shall be mandatory for the Bureau to conduct a certification election for the purpose of determining the
representative of the employees in the appropriate bargaining unit and certify the winner as the exclusive collective bargaining
representative of all the employees in the unit." 4 It speaks clearly and categorically. There is no element of ambiguity. What is

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required is that the petition for certification election should have in its favor "the written consent of at least 30% of all the
employees in the bargaining unit." The duty then cast on the Director of Labor Relations is to ascertain whether there has been
such a compliance. There is no doubt in this case there was evidence that more than a total of two-hundred signatures were
obtained by respondent Union in seeking such a certification election. The respondent Director having satisfied himself that the
codal requisite had been met, he had no choice but to order such certification. In the language of the above provision, "it shall be
mandatory for the Bureau to conduct a certification election for the purpose of determining the representative of the employees
in the appropriate bargaining unit and certify the winner as the exclusive collective bargaining representative of all the
employees in the unit." There is, therefore, no basis for the contention that a duty is cast on respondent Director to allow a rival
labor organization, such as petitioner, to verify the authenticity of such signatures. At any rate, if there is any doubt as to the
required number having been met, what better way is there than the holding of a certification election to ascertain which union
really commands the allegiance of the rank-and-file employees.
(Today's Knitting Free Workers Union v. Noriel, G.R. No. L-45057, [February 28, 1971], 166 PHIL 442-448)

Substantial Support
Effect of Disclosure
Cases:
Third, attached to the original petition for certification election was a list of 141 supporting signatures out of the 300 employees
belonging to the appropriate bargaining unit to be represented by respondent FFW-SMQCC. Respondent QCC sought to delete
from the list some 36 signatures which were allegedly forged and falsified. Petitioner, likewise, submitted a joint affidavit of 13
employees, disclaiming the validity of the signatures therein.
Granting that 36 signatures were falsified and that 13 were disowned, this leaves 92 undisputed signatures which is definitely
more than 75 — i.e., 25% of the total number of company employees required by law to support a petition for certification
election. The disclaimer by 13 employees of their respective signatures covers only their own personal participation and cannot
in any way be extended to include the rest of those who did not question the same.
(National Mines and Allied Workers Union v. Secretary of Labor, G.R. No. 106446, [November 16, 1993])

Submission
Cases:
SIMULTANEOUS SUBMISSION OF THE 25% CONSENT SIGNATURE UPON THE FILING OF PETITION; SHOULD NOT BE STRICTLY
APPLIED. — In line with this policy, we feel that the administrative rule requiring the simultaneous submission of the 25%
consent signatures upon the filing of petition for certification election should not be strictly applied to frustrate the
determination of the legitimate representative of the workers. Significantly, the requirement in the rule is not found in Article
256, the law it seeks to implement. This is all the more reason why the regulation should at best be given only a directory effect.
Accordingly, we hold that the mere filing of a petition for certification election within the freedom period is sufficient basis for
the issuance of an order for the holding of a certification election, subject to the submission of the consent signatures within a
reasonable period from such filing.
(Port Workers Union of the Phil. v. Laguesma, G.R. Nos. 94929-30, [March 18, 1992])
The support requirement is a mere technicality which should be employed in determining the true will of the workers 21 instead
of frustrating the same. Thus, in Port Workers Union of the Philippines (PWUP) v. Laguesma, 22 this Court declared that:
"In line with this policy (that the holding of a certification election is a certain and definitive mode of arriving at the choice of the
employees' bargaining representative), we feel that the administrative rule requiring the simultaneous submission of the 25%
consent signatures upon the filing of the petition for certification election should not be strictly applied to frustrate the
determination of the legitimate representative of the workers. Significantly, the requirement in the rule is not found in Article
256, the law it seeks to implement. This is all the more reason why the regulation should at best be given only a directory effect.

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Accordingly, we hold that the mere filing of a petition for certification election within the freedom period is sufficient basis for
the issuance of an order for the holding of a certification election, subject to the submission of the consent signatures within a
reasonable period from such filing."
All doubts as to the number of employees actually supporting the holding of a certification election should, therefore, be
resolved by going through such procedure. It is judicially settled that a certification election is the most effective and expeditious
means of determining which labor organization can truly represent the working force in the appropriate bargaining unit of the
company. 23 If the OTCLU wanted to be retained as the rank-and-file employees' bargaining representative, it should have
sought their vote, not engaged in legal sophistry. The selection by the majority of the employees of the union which would best
represent them in the CBA negotiations should be achieved through the democratic process of an election.
(Oriental Tin Can Labor Union v. Sec. of Labor and Employment, G.R. No. 116751, 116779, [August 28, 1998])

When not required


Cases:
COLLECTIVE BARGAINING AGREEMENT; UNORGANIZED ESTABLISHMENT ARTICLE 257 OF LABOR CODE; APPLIES. — Article 257 is
applicable only to unorganized labor organizations and not to establishments like PASAR where there exists a certified bargaining
agent, petitioner ALU, which as the record shows had previously entered into a CBA with the management. Nowhere in the said
provision does it require that the petition in organized establishments should be accompanied by the written consent of at least
twenty percent (20%) of the employees of the bargaining unit concerned much less a requirement that the petition be supported
by the majority of the rank-and-file employees. As above stated, Article 257 is applicable only to unorganized establishments.
(Associated Labor Unions v. Ferrer-Calleja, G.R. No. 85085, [November 6, 1989], 258-A PHIL 702-712)

Discretion Rule Application


Cases:
LABOR LAW; BUREAU OF LABOR RELATIONS; GIVEN WIDE DISCRETION IN DECIDING WHETHER OR NOT TO GRANT A
CERTIFICATION ELECTION. — It is Our holding in the case of B.F. Goodrich Phils., Inc. vs. B.F. Goodrich Confidential & Salaried
Employees Union-NATU (49 SCRA 532) that the objectives of the Industrial Peace Act would be sooner attained if at the earliest
opportunity the employees, all of them, in an appropriate bargaining unit be pooled to determine which labor organization
should be its exclusive representative. This Court had made it clear that We should give discretion to the Court of Industrial
Relations, or in this case, the Bureau of Labor Relations in deciding whether or not to grant a petition for certification election
considering the facts and circumstances of which it has intimate knowledge. Moreover, a perusal of Art. 258 of the Labor Code as
amended by Presidential Decree No. 442 reveals that compliance with the 30% requirement (now 20%) makes it mandatory
upon the Bureau of Labor Relations to order the holding of a certification election in order to determine the exclusive-bargaining
agent of the employees. Stated otherwise, it means that with such, the Bureau is left without any discretion but to order the
holding of certification election. Parenthetically, where the petition is supported by less than 30% (now 20%) the Bureau of Labor
Relations has discretion whether or not to order the holding of certification election depending on the circumstances of the case.
Thus, it is Our holding in LVN Pictures vs. Musicians Guild, et al. (1 SCRA 132) that in connection with certification election, the
Court of Industrial Relations enjoys a wide discretion in determining the procedure necessary to insure a fair and free choice of
bargaining representatives by employees, and having exercised its sound discretion, this Court cannot interfere.|||
(Airtime Specialists, Inc. v. Ferrer-Calleja, G.R. No. 80612-16, [December 29, 1989])
TWENTY-FIVE PERCENT (25%) SUBSCRIPTION REQUIREMENT; IMMATERIAL THERETO; REASONS THEREFOR. — CMC's insistence
on the 25% subscription requirement, is clearly immaterial. The same has been expressly deleted by Section 24 of Republic Act
No. 6715 and is presently prescribed only in organized establishments, that is, those with existing bargaining agents. Compliance
with the said requirement need not even be established with absolute certainty. The Court has consistently ruled that "even
conceding that the statutory requirement of 30% (now 25%) of the labor force asking for a certification election had not been
strictly complied with, the Director (now the Med-Arbiter) is still empowered to order that it be held precisely for the purpose of

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ascertaining which of the contending labor organizations shall be the exclusive collective bargaining agent. The requirement then
is relevant only when it becomes mandatory to conduct a certification election. In all other instances, the discretion, according to
the rulings of this Tribunal, ought to be ordinarily exercised in favor of a petition for certification.
(California Manufacturing Corp. v. Laguesma, G.R. No. 97020, [June 8, 1992])

Mandatory Election
Cases:
CERTIFICATION ELECTION; CALL IS MANDATORY WHERE STATUTORY REQUIREMENT IS MET. — Under Art. 257 of the Labor Code
once the statutory requirement is met, the Director of Labor Relations has no choice but to call a certification election (Atlas Free
Workers Union (AFWU) PSSLU Local v. Noriel, 104 SCRA 565 [1981]; Vismico Industrial Workers Association (VIWA) v. Noriel, 131
SCRA 569 [1984]). It becomes in the language of the New Labor Code "Mandatory for the Bureau to conduct a certification
election for the purpose of determining the representative of the employees in the appropriate bargaining unit and certify the
winner as the exclusive bargaining representative of all employees in the unit."; more so when there is no existing collective
bargaining agreement.; and there has not been a certification election in the company for the past three years as in the instant
case.
(Belyca Corp. v. Calleja, G.R. No. 77395, [November 29, 1988], 250 PHIL 193-205)

Motion for Intervention on Support Requirement


When Support is Not required
Cases:
The respondent Director did not abuse her discretion in issuing the contested order. It is crystal clear from the said provisions
that the requisite written consent of at least 20% of the workers in the bargaining unit applies to petitioners for certification
election only, and not to motions for intervention. Nowhere in the aforesaid legal provisions does it appear that a motion for
intervention in a certification election must be accompanied by a similar written consent. Not even in the Implementing Rules of
the Labor Code (see Rule V, Rules Implementing the Labor Code). Obviously, the percentage requirement pertains only to the
petition for certification election, and nothing else.
This leads Us to the question of purpose. the reason behind the 20% requirement is to ensure that the petitioning union has a
substantial interest in the representation proceedings * and, as correctly pointed out by the Solicitor General, that a considerable
number of workers desire their representation by the said petitioning union for collective bargaining purposes. Hence, the mere
fact that 20% of the workers in the bargaining unit signify their support to the petition by their written consent, it becomes
mandatory on the part of the Med-Arbiter to order the holding of a certification election in an unorganized establishment. The
20% requirement, thereof, is peculiar to petitions for certification election.
In the light of the foregoing, KAMAPI must be allowed to participate in the certification election since the essence of such
proceeding is to settle once and for all which union is preferred by the workers to represent them. As long as the motion for
intervention has been properly and timely filed and the intervention would not cause any injustice to anyone, it should not be
denied and this is so even if the eventual purpose of the motion for intervention is to participate in the certification election.
After all the original applicant had already met the 20% requirement.
(Philippine Ass'n. of Free Labor Unions v. Calleja, G.R. No. 79347, [January 26, 1989], 251 PHIL 442-447)

c. Unorganized Establishment
Article 242. Rights of legitimate labor organizations. A legitimate labor organization shall have the right:
g. To act as the representative of its members for the purpose of collective bargaining;

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h. To be certified as the exclusive representative of all the employees in an appropriate bargaining unit for
purposes of collective bargaining;
i. To be furnished by the employer, upon written request, with its annual audited financial statements, including
the balance sheet and the profit and loss statement, within thirty (30) calendar days from the date of receipt of
the request, after the union has been duly recognized by the employer or certified as the sole and exclusive
bargaining representative of the employees in the bargaining unit, or within sixty (60) calendar days before the
expiration of the existing collective bargaining agreement, or during the collective bargaining negotiation;
j. To own property, real or personal, for the use and benefit of the labor organization and its members;
k. To sue and be sued in its registered name; and
l. To undertake all other activities designed to benefit the organization and its members, including cooperative,
housing, welfare and other projects not contrary to law.
Notwithstanding any provision of a general or special law to the contrary, the income and the properties of
legitimate labor organizations, including grants, endowments, gifts, donations and contributions they may receive
from fraternal and similar organizations, local or foreign, which are actually, directly and exclusively used for their
lawful purposes, shall be free from taxes, duties and other assessments. The exemptions provided herein may be
withdrawn only by a special law expressly repealing this provision.
Article 257. Petitions in Unorganized Establishments. - In any establishment where there is no certified bargaining
agent, a certification election shall automatically be conducted by the Med-Arbiter upon the filing of a petition by
any legitimate labor organization, including a national union or federation which has already issued a charter
certificate to its 1ocal/chapter participating in the certification election or a local/chapter which has been issued a
charter certificate by the national union or federation. In cases where the petition was filed by a national union or
federation, it shall not be required to disclose the names of the local chapter officers and members.
Cases:
The applicable provision of law in the case at bar is Art. 257 of the Labor Code. It reads —
"Art. 257. Petitions in unorganized establishments. — In any establishment where there is no certified bargaining agent, a
certification election shall automaticallybe conducted by the Med-Arbiter upon the filing of a petition by a legitimate labor
organization" (emphasis supplied)
The supervisory employees of PT&T did not yet have a certified bargaining agent to represent them at the time the UNION, which
is a legitimate labor organization duly registered with the Department of Labor and Employment, 6 filed the petition for
certification election. Since no certified bargaining agent represented the supervisory employees, PT&T may be deemed an
unorganized establishment within the purview of Art. 257 of the Labor Code.
The fact that petitioner's rank-and-file employees were already represented by a certified bargaining agent does not make PT&T
an organized establishment vis-a-vis the supervisory employees. After all, supervisory employees are "not . . . eligible for
membership in a labor organization of the rank-and-file employees."
(Philippine Telegraph and Telephone Corp. v. Laguesma, G.R. No. 101730, [June 17, 1993])
CERTIFICATION ELECTION; PETITION FILED BY AN UNORGANIZED ESTABLISHMENT; DOES NOT REQUIRE THE CONSENT OF THE
MAJORITY OF ITS EMPLOYEES. — While it may be true that the petition for certification election did not carry the authorization of
a majority of the rank-and-file employees of the petitioner, their consent is not necessary when the bargaining unit that the
union seeks to represent, is still unorganized. The petition for certification election may be filed by any union, not by the
employees.
(Celine Marketing Corp. v. Laguesma, G.R. No. 97568, [February 4, 1992])

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2. The Employer as Initiating Party


Article 258. When an employer may file petition. When requested to bargain collectively, an employer may petition the
Bureau for an election. If there is no existing certified collective bargaining agreement in the unit, the Bureau shall, after
hearing, order a certification election.
All certification cases shall be decided within twenty (20) working days.
The Bureau shall conduct a certification election within twenty (20) days in accordance with the rules and regulations
prescribed by the Secretary of Labor.
a. Role Employer
Cases:
EMPLOYER, NO RIGHT TO INTERFERE THEREIN; EXCEPTION. — The Court would wish to stress once more the rule which it has
consistently pronounced in many earlier cases that a certification election is the sole concern of the workers and the employer is
regarded as nothing more than a bystander with no right to interfere at all in the election. The only exception here is where the
employer has to file a petition for certification election pursuant to Article 258 of the Labor Code because it is requested to
bargain collectively.
(Philippine Fruits and Vegetable Industries, Inc. v. Torres, G.R. No. 92391, [July 3, 1992])
LABOR AND SOCIAL LEGISLATION; LABOR CODE; CERTIFICATION ELECTION; EMPLOYERS WITH NO LEGAL STANDING. — Except
where the employer has to file a petition for certification election pursuant to Article 258 of the Labor Code because of a request
to bargain collectively, it has nothing to do with a certification election which is the sole concern of the workers. Its role in a
certification election has aptly been described in Trade Unions of the Philippines and Allied Services (TUPAS) v. Trajano, as that of
a mere by-stander. It has no legal standing in a certification election as it cannot oppose the petition or appeal the Med-Arbiter's
orders related thereto. An employer that involves itself in a certification election lends suspicion to the fact that it wants to
create a company union.
EXCLUSIVE CONCERN OF LABOR AND EMPLOYER DEFINITELY AN INTRUDER. — This Court's disapprobation of management
interference in certification elections is even more forceful in Consolidated Farms, Inc. v. Noriel, where we held: "On a matter
that should be the exclusive concern of labor, the choice of a collective bargaining representative, the employer is definitely an
intruder. His participation, to say the least, deserves no encouragement. This Court should be the last agency to lend support to
such an attempt at interference with a purely internal affair of labor."
EMPLOYERS, THOUGH NOTIFIED OF PETITION, ARE NOT CONSIDERED PARTIES THERETO. — The three security agencies should
not even be adverse parties in the certification election itself. We note with disapproval the title given to the petition for
certification election of the Union by the Med-Arbiter and the Secretary of Labor naming the three security agencies as
respondents. Such is clearly an error. While employers may rightfully be notified or informed of petitions of such nature, they
should not, however, be considered parties thereto with concomitant right to oppose it. Sound policy dictates that they should
maintain a strictly hands-off policy.
(Philippine Scout Veterans Security and Investigation Agency v. Torres, G.R. No. 92357, [July 21, 1993])
MANAGEMENT MUST MAINTAIN A STRICTLY HANDS-OFF POLICY IN THE CHOICE OF AN EXCLUSIVE BARGAINING
REPRESENTATIVE OF THE WORKERS. — We bewail private respondent's tenacious opposition to petitioner's certification election
petition. Such a stance is not conducive to industrial peace. Time and again, we have emphasized that when a petition for
certification election is filed by a legitimate labor organization, it is good policy for the employer not to have any participation or
partisan interest in the choice of the bargaining representative. While employers may rightfully be notified or informed of
petitions of such nature, they should not, however, be considered parties thereto with an inalienable right to oppose it. An
employer that involves itself in a certification election lends suspicion to the fact that it wants to create a company union. Thus,
in Consolidated Farms, Inc. II v. Noriel, (84 SCRA 469, 473 [1978]), we declared that "[o]n a matter that should be the exclusive
concern of labor, the choice of a collective bargaining representative, the employer is definitely an intruder. His participation, to
say the least, deserves no encouragement. This Court should be the last agency to lend support to such an attempt at
interference with a purely internal affair of labor . . . [While] it is true that there may be circumstances where the interest of the
employer calls for its being heard on the matter, . . . sound policy dictates that as much as possible, management is to maintain a

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strictly hands-off policy. For if it does not, it may lend itself to the legitimate suspicion that it is partial to one of the contending
unions. That is repugnant to the concept of collective bargaining. That is against the letter and spirit of welfare legislation
intended to protect labor and promote social justice. The judiciary then should be the last to look with tolerance at such efforts
of an employer to take part in the process leading to the free and untrammeled choice of the exclusive bargaining representative
of the workers."
(Samahan ng mga Manggagawa sa FilSystems v. Secretary of Labor and Employment, G.R. No. 128067, [June 5, 1998], 353 PHIL
122-133)

b. Motion to Dismiss
Cases:
MAY NOT BE QUESTIONED BY EMPLOYER; RULE AND EXCEPTION; CASE AT BAR. — PT&T did not possess the legal personality to
file a motion to dismiss the petition for certification election even if based on the ground that its supervisory employees are in
reality managerial employees. It is well-settled that an employer has no standing to question a certification election since this is
the sole concern of the workers. The only exception to this rule is where the employer has to file the petition for certification
election itself pursuant to Art. 258 of the Labor Code because it was requested to bargaining collectively. But, other than this
instance, the choice of a collective bargaining agent is purely the internal affair of labor. What PT&T should have done was to
question the inclusion of any disqualified employee in the certification election during the exclusion-inclusion proceedings before
the representation officer. Indeed, this is precisely the purpose of the exclusion-inclusion proceedings, i.e., to determine who
among the employees are entitled to vote and be part of the bargaining unit sought to be certified.
(Philippine Telegraph and Telephone Corp. v. Laguesma, G.R. No. 101730, [June 17, 1993])

c. Parties
Cases:
Devoid of merit is petitioner's contention that the employment status of the members of respondent CLOP who joined the strike
must first be resolved before a certification election can be conducted.
As held in the case of Philippine Fruits and Vegetables Industries, Inc. v. Torres, 211 SCRA 95 (1992):
"At any rate, it is now well-settled that employees who have been improperly laid off but who have a present, unabandoned
right to or expectation of re-employment, are eligible to vote in certification elections (Rothenberg on Labor Relations, p. 548).
Thus, and to repeat, if the dismissal is under question, as in the case now at bar whereby a case of illegal dismissal and/or unfair
labor practice was filed, the employees concerned could still qualify to vote in the elections."
Therefore, the employees of petitioner who participated in the strike, legally remain as such, until either the motion to declare
their employment status legally terminated or their complaint for illegal dismissal is resolved by the NLRC.
It should be noted that it is petitioner, the employer, which has offered the most tenacious resistance to the holding of a
certification election. This must not be so for the choice of a collective bargaining agent is the sole concern of the employees. The
employer has no right to interfere in the election and is merely regarded as a bystander
(R. Transport Corp. v. Laguesma, G.R. No. 106830, [November 16, 1993])

d. Agency
Conducting Agency
Article. 226. Bureau of Labor Relations. - The Bureau of Labor Relations and the Labor Relations Divisions in the
regional offices of the Department of Labor, shall have original and exclusive authority to act, at their own initiative
or upon request of either or both parties, on all inter-union and intra-union conflicts, and all disputes, grievances or

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problems arising from or affecting labor-management relations in all workplaces, whether agricultural or non-
agricultural, except those arising from the implementation or interpretation of collective bargaining agreements
which shall be the subject of grievance procedure and/or voluntary arbitration.
The Bureau shall have fifteen (15) working days to act on labor cases before it, subject to extension by agreement of
the parties.
Article. 232. Prohibition on certification election. - The Bureau shall not entertain any petition for certification
election or any other action which may disturb the administration of duly registered existing collective bargaining
agreements affecting the parties except under Articles 253, 253-A and 256 of this Code.
Article 258. When an employer may file petition. When requested to bargain collectively, an employer may
petition the Bureau for an election. If there is no existing certified collective bargaining agreement in the unit, the
Bureau shall, after hearing, order a certification election.
All certification cases shall be decided within twenty (20) working days.
The Bureau shall conduct a certification election within twenty (20) days in accordance with the rules and
regulations prescribed by the Secretary of Labor.
Article 258-A. Employer as Bystander. - In all cases, whether the petition for certification election is filed by an
employer or a legitimate labor organization, the employer shall not be considered a party thereto with a
concomitant right to oppose a petition for certification election. The employer participation in such proceedings
shall be limited to:
(1) being notified or informed of petitions of such nature; and
(2) submitting the list of employees during the pre-election conference should the Med-Arbiter act favorably on the
petition.
Article 259. Appeal from certification election orders. Any party to an election may appeal the order or results of
the election as determined by the Med-Arbiter directly to the Secretary of Labor and Employment on the ground
that the rules and regulations or parts thereof established by the Secretary of Labor and Employment for the
conduct of the election have been violated. Such appeal shall be decided within fifteen (15) calendar days.
Cases:
We hold that the referral of the appeal to the TUCP is glaringly illegal and void. The Labor Code never intended that the Director
of Labor Relations should abdicate, delegate and relinquish his arbitrational prerogatives in favor of a private person or entity or
to a federation of trade unions. Such a surrender of official functions is an anomalous, deplorable and censurable renunciation of
the Director's adjudicatory jurisdiction in representation cases.
Article 226 of the Labor Code provides in peremptory terms that the Bureau of Labor Relations and the labor relations divisions in
the regional offices of the Ministry of Labor "shall have original and exclusive authority to act, at their own initiative or upon
request of either or both parties, on all inter-union and intra-union conflicts, and all disputes, grievances or problems arising
from or affecting labor-management relations in all workplaces whether agricultural or non-agricultural, except those arising
from the implementation or interpretation of collective bargaining agreements which shall be the subject of grievance procedure
and/or voluntary arbitration." llcd
Article 259 of the Labor Code provides that "all certification cases shall be decided within twenty (20) working days. " Article 260
of the same Code provides that the Bureau of Labor Relations should decide appeals in representation cases "within fifteen (15)
working days", or twenty working days, according to section 10, Rule V, Book V of the Rules and Regulations Implementing the
Labor Code. Section 10 further provides that "the decision of the Bureau in all cases shall be final and unappealable."
Those provisions are mandatory and should be strictly adhered to. They are part and parcel of the adequate administrative
machinery established by the Labor Code for the expeditious settlement of labor disputes. The Director's act of referring the
appeal of the Associated Labor Unions to the TUCP is not only contrary to law but is a patent nullification of the policy of the
Labor Code to avoid delay in the adjudication of labor controversies.

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(Ilaw at Buklod ng Manggagawa v. Director of Labor Relations, G.R. No. L-48931, [July 16, 1979], 180 PHIL 383-388)

e. Requisite for Validity of Election


Cases:
Article 256 of the Labor Code provides, among others, that:
To have a valid, election, at least a majority of all eligible voters in the unit must have cast their votes. The labor union receiving
the majority of the valid votes cast shall be certified as the exclusive bargaining agent of all workers in the unit . . . [Emphasis
supplied.]
(Benguet Electric Cooperative, Inc. v. Ferrer-Calleja, G.R. No. 79025, [December 29, 1989], 259 PHIL 1230-1239)

f. Nature of Proceeding
Cases:
"Considering that certification proceedings are investigatory in nature, since —
'the object of the proceedings is not the decision of any alleged commission of wrong nor asserted deprivation of rights but is
merely that determination of proper bargaining units and the ascertainment of the will and choice of the employees in respect of
the selection of a bargaining representative. The determination of the proceedings does not entail the entry of remedial orders
or redress of rights, but culmination solely in an official designation of bargaining units and an affirmation of the employees'
expressed choice of bargaining agent.'
(Young Men Labor Union Stevedorers v. Court of Industrial Relations, G.R. No. L-20307, [February 26, 1965], 121 PHIL 271-276)
A MERE INVESTIGATION OF A NON-ADVERSARY CHARACTER WHERE RULES OF PROCEDURE ARE NOT STRICTLY APPLIED. — The
contention that the petitioners had no right to represent the principal petitioners which had not appealed the dismissal order is
also not acceptable. We repeat that the certification election is not a litigation but a mere investigation of a non-adversary
character where the rules of procedure are not strictly applied. Technical rules and objections should not hamper the correct
ascertainment of the labor union that has the support or confidence of the majority of the workers and is thus entitled to
represent them in their dealings with management.
(Port Workers Union of the Phil. v. Laguesma, G.R. Nos. 94929-30, [March 18, 1992])

CAVEAT: Case Doctrines may not be as accurate as what was discussed/reported in class.

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