A.2.

BARGAINING UNIT

Definition

“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. [Sec. 1(d), Rule I, Book V]

It is “a group of employees of a given employer comprised of all or less than all of the entire body of
employees, which the collective interests of all the employees indicate to be best suited to serve
reciprocal rights and duties of the parties consistent with equity to the employer. [Belyca Corp. v.Calleja,
G.R. No. 77395 (1988) citing Rothenberg]

Functions of an Appropriate Bargaining Unit

(1) An ELECTORAL DISTRICT. – It marks the boundaries of those who may participate in a certification
election.

(2) An ECONOMIC UNIT. – They are a group of employees with community of interests.

(3) A SOVEREIGN BODY. – It selects the sole and exclusive bargaining agent

Role of a bargaining unit

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 of such unit for the
purpose of collective bargaining. [Art. 267]

Right of individual or group of employees to present grievances

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, to
participate in the 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. [Art. 267]

CBA Coverage

When there has been a factual determination by the Labor Arbiter that the petitioners were regular
employees, said employees shall fall within the coverage of the bargaining unit and are therefore entitled
to CBA benefits as a matter of law and contract. [Farley Fulache, et al. v. ABS-CBN, G.R. No. 183810,
2010]

Effect of Prior Agreement

[A prior agreement] as to the exclusion [of workers] from the bargaining […] can never bind subsequent
federations and unions as [employees were not privy to that agreement]. And even if [they were privy], it
can never bind subsequent federations and unions because it is a curtailment of the right to self -
organization guaranteed by the labor laws [General Rubber & Footwear Corp. v. BLR, G.R. No. 74262,
(1987)]
Rationale

It is a curtailment of the right to selforganization. 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. [DLSU v. DLSUEA, G.R. No. 109002, (2000)]

Effect of Inclusion of Employees

Outside the Bargaining Unit or Commingling

General Rule: It shall not be a ground for the cancellation of the registration of the union. Said employees
are automatically deemed removed from the list of membership of said union. [Art. 256]

Exception: Unless such mingling was brought about by misrepresentation, false statement or fraud under
Article 247 (Grounds for cancellation of Union Registration) of the Labor Code. [SMCC-Super v. Charter
Chemical and Coating Corporation, G.R. No. 169717 (2011)]

Corporate Entities

General Rule: Two companies having separate juridical personalities shall NOT be treated as a single
bargaining unit. [Diatagon Labor Federation Local v. Ople, G.R. No. L44493-94 (1980)]

Exception: Pervasive Unitary Aspect of Management Doctrine The cross-linking of the agencies
command, control, and communication systems indicate their unitary corporate personality. Accordingly,
the veil of corporate fiction should be lifted for the purpose of allowing the employees of the three
agencies to form a single labor union. [Philippine Scouts Veterans v. Torres, G.R. No. 92357 (1993)]

Principles in determining whether to establish separate bargaining units

(1) The existence of a bona fide business relationship between the 2 companies is not proof of being a
single corporate entity, especially when the services provided by the other company are merely auxiliary.

(2) The fact that there are as many bargaining units as there are companies in a conglomeration of
companies is a positive proof that a corporation is endowed with a legal personality

DISTINCTLY ITS OWN, independent and separate from other corporations. (3) Separate legitimate
purposes militate against treating one corporation as an adjunct or alter ego of the other.

(4) The fact that the businesses are related, that some of the employees are the same persons working in
the other company and the physical plants, offices and facilities are in the same compound are NOT
sufficient to justify piercing the corporate veil. (Indophil Textile Mills Workers Union v. Calica, 1992;
Diatagon Labor Federation v. Ople, 1980)

Spun-off corporations

The transformation of companies is a management prerogative and business judgment which the courts
cannot look into unless it is contrary to law, public policy or morals. If, considering the spin-offs, the
companies would consequently have their respective and distinctive concerns in terms of nature of work,
wages, hours of work and other conditions of employment. The nature of their products and scales of
business may require different skills, volumes of work, and working conditions which must necessarily be
commensurate by different compensation packages. (San Miguel Union v Confesor, 1996)
A.2.A. TEST TO DETERMINE THE CONSTITUENCY OF AN APPROPRIATE BARGAINING UNIT

4 Factors:

(1) Will of the Employees (Globe Doctrine)

(2) Affinity and unity of employees’ interest (Substantial Mutual Interests Rule)

(3) Prior collective bargaining history

(4) Employment status [Democratic Labor Association v. Cebu Stevedoring Co. Inc, G.R. No. L-10321,
(1958)] [UP v FerrerCalleja, (1992)]

Note: Of these 4 factors, the court has identified that it is the 2nd factor which has emerged as the
standard in determining the proper constituency of a collective bargaining unit.

Other factors:

(5) Geography and Location

(6) Policy of avoiding fragmentation of the bargaining unit

(1) Globe Doctrine

A practice designated as the "Globe doctrine," sanctions the holding of a series of elections, not for the
purpose of allowing the group receiving an overall majority of votes to represent all employees, but for the
specific purpose of permitting the employees in each of the several categories to select the group which
each chooses as a bargaining unit. [Kapisanan ng mga Manggagawa sa Manila Road Co. v. Yard Crew
Union, G.R. Nos. L16292-94 (1960)]

Rationale

Highly skilled or specialized technical workers may choose to form their own bargaining unit because they
may be in better position tobargain with the employer considering the market value of their skills.

(2) Community or Mutuality of Interests

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… It
considers the desires of the employees as one of the factors. [P v. Ferrer-Calleja, G.R. No.96189, (1992)]

Rationale

There are greater chances of success for the collective bargaining process. The bargaining unit is
designed to maintain the mutuality of interest among the employees in such unit. When the interest
between groups has changed over time, there is reason to dissolve, change or expand a certain
bargaining unit.

(3) Prior Collective Bargaining History

The existence of a prior collective bargaining history is neither decisive nor conclusive in the
determination of what constitutes an appropriate bargaining unit. [National Association of Free Trade
Unions v. Mainit Lumber Development Company Workers Union, G.R. No. 79526, (1990)]

(4) Employment status

Among the factors to be considered is the employment status of the employees to be affected—[regular,
casual, seasonal, probationary etc] that is the positions and categories of work to which they belong, and
the unity of employees' interest such as substantial similarity of work and duties.[Belyca Corp. v. Calleja,
G.R. No. 77395 (1988)]

(5) Geography and Location

Geography and location only play a significant role if:

(1) The separation between the camps and the different kinds of work in each all militate in favor of the
system of separate bargaining units;

(2) When the problems and interests of the workers are peculiar in each camp or department;

(3) The system of having one collective bargaining unit in each camp has operated satisfactorily in the
past. [Benguet Consolidated Inc. and Balatok Mining Co. v. Bobok Lumberjack Association, G.R. No. L-
11029 (1958)]

(6) Policy of avoiding fragmentation of the bargaining unit .It bears noting that the goal of the DOLE is
geared towards "a single employer wide unit which is more to the broader and greater benefit of the
employees working force." The philosophy is to avoid fragmentation of the bargaining unit so as to
strengthen the employees’ bargaining power with the management. To veer away from such goal would
be contrary, inimical and repugnant to the objectives of a strong and dynamic unionism. [Phil. Diamond
Hotel and Resort Inc v Manila Diamond Hotel and Employees Union, GR No. 158075 (2006)]