BASIC CONCEPT

Philippine Constitution
Article III, 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.
Article XIII, 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.

Labor Code
Article 218. 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.
Article 219. Definitions.
(a) "Commission" means the National Labor Relations Commission or any of its divisions, as the case may be,
as provided under this Code.
(b) "Bureau" means the Bureau of Labor Relations and/or the Labor Relations Divisions in the regional offices
established under Presidential Decree No. 1, in the Department of Labor.
(c) "Board" means the National Conciliation and Mediation Board established under Executive Order No. 126.
(d) "Council" means the Tripartite Voluntary Arbitration Advisory Council established under Executive Order
No. 126, as amended.
(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 As amended by Sec. 4 of R.A. No. 6715 (1989)
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.
(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.
(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.
(j) "Bargaining representative" means a legitimate labor organization or any officer or agent of such
organization whether or not employed by the employer.
(k) "Unfair labor practice" means any unfair labor practice as expressly defined by this Code.
(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.
(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.
(n) "Voluntary Arbitrator" means any person accredited by the Board as such, or any person named or
designated in the Collective Bargaining Agreement by the parties to act as their Voluntary Arbitrator, or one
chosen with or without the assistance of the National Conciliation and Mediation Board, pursuant to a
selection procedure agreed upon in the Collective Bargaining Agreement, or any official that may be
authorized by the Secretary of Labor and Employment to act as Voluntary Arbitrator upon the written request
and agreement of the parties to a labor dispute.
(o) "Strike" means any temporary stoppage of work by the concerted action of employees as a result of an
industrial or labor dispute.
(p) "Lockout" means any temporary refusal of an employer to furnish work as a result of an industrial or labor
dispute.
(q) "Internal union dispute" includes all disputes or grievances arising from any violation of or disagreement
over any provision of the constitution and by laws of a union, including any violation of the rights and
conditions of union membership provided for in this Code.
(r) "Strike-breaker" means any person who obstructs, impedes, or interferes with by force, violence, coercion,
threats, or intimidation any peaceful picketing affecting wages, hours or conditions of work or in the exercise
of the right of self-organization or collective bargaining.
(s) "Strike area" means the establishment, warehouses, depots, plants or offices, including the sites or
premises used as runaway shops, of the employer struck against, as well as the immediate vicinity actually
used by picketing strikers in moving to and fro before all points of entrance to and exit from said
establishment.
Article 290. [275] Tripartism, Tripartite Conferences, and Tripartite Industrial Peace Councils.
(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, and other interest groups as the case may be, 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.
(c) A National Tripartite Industrial Peace Council (NTIPC) shall be established, headed by the Secretary of Labor
and Employment, with twenty (20) representatives regular intervals. For this purpose, a sectoral nomination,
selection, and recall process shall be established by the DOLE in consultation with the sectors observing
Tripartite Industrial Peace Councils (TIPCs) at the regional or industry level shall also be established with
representatives from government, workers and employers to serve as a continuing forum for tripartite
advisement and consultation in aid of organizations, enhancing their respective rights, attaining industrial
peace, and improving productivity.

The TIPCs shall have the following functions:

(1) Monitor the full implementation and compliance of concerned sectors with the provisions of all tripartite
instruments, including international conventions and declarations, codes of conduct, and social accords;
(2) Participate in national, regional or industry-specific tripartite conferences which the President or the
Secretary of Labor and Employment may call from time to time;
(3) Review existing labor, economic and social policies and evaluate local and international developments
affecting them;
(4) Formulate, for submission to the President or to Congress, tripartite views, recommendations and
proposals on labor, economic, and social concerns, including the presentation of tripartite positions on
relevant bills pending in Congress;
(5) Advise the Secretary of Labor and Employment in the formulation or implementation of policies and
legislation affecting labor and employment;
(6) Serve as a communication channel and a mechanism for undertaking joint programs among government,
workers, employers and their organizations toward enhancing labor-management relations; and
(7) Adopt its own program of activities and rules, consistent with development objectives.
All TIPCs shall be an integral part of the organizational structure of the NTIPC.
The operations of all TIPCs shall be funded from the regular budget of the DOLE.
 CONCEPT AND SCOPE

Labor Code
Article 253. [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 257. [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 for their mutual aid and
protection, subject to the provisions of Article 264 of this Code.
Article 292-c. Any employee, whether employed for a definite period or not, shall, beginning on his first day of
service, be considered as an employee for purposes of membership in any labor union.
Article 219-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.
Article 219-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 As amended by Sec. 4 of R.A. No. 6715 (1989)
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.

Omnibus Rules, Book V

RULE I
Definition of Terms
SECTION 1. Definition of terms. —
(a) "Commission" means the National Labor Relations Commission.
(b) "Bureau" means the Bureau of Labor Relations and/or the Industrial Relations Division in the Regional
Offices of the Department of Labor and Employment.
(c) "Board" means the National Conciliation and Mediation Board.
(d) "Code" means the Labor Code of the Philippines, as amended.
(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 a particular 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.
(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) "Local Union" means any labor organization operating at the enterprise level.
(i) "National Union/Federation" means any labor organization with at least ten (10) locals or chapters each of
which must be a duly recognized collective bargaining agent.
(j) "Legitimate Labor Organization" means any labor organization duly registered with the Department of
Labor and Employment and includes any branch, local or affiliate thereof.
(k) "Company Union" means any labor organization whose formation, function or administration has been
assisted by any act defined as unfair labor practice by the Code.
(l) "Bargaining Representative" means a legitimate labor organization or any duly authorized officer or agent of
such organization whether or not employed by the employer.
(m) "Unfair Labor Practice" means any unfair labor practice as expressly defined in the Code.
(n) "Labor or Industrial Dispute" includes any controversy or matter concerning terms or conditions of
employment or the association or representation of persons in negotiating the fixing, maintaining, changing or
arranging of terms and conditions of employment regardless of whether or not the disputants stand in the
proximate relationship of employers and employees.
(o) "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 require 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.
(p) "Voluntary Arbitrator" means any person accredited by the Board as such, or any person named or
designated in the collective bargaining agreement, by the parties to act as their voluntary arbitrator, or one
chosen, with or without the assistance of the National Conciliation and Mediation Board, pursuant to a
selection procedure agreed upon in the collective bargaining agreement, or any official that may be authorized
by the Secretary of Labor and Employment to act as voluntary arbitrator upon the written request and
agreement of the parties to a labor dispute.
(q) "Strike" means any temporary stoppage of work by the concerted action of employees as a result of a labor
or industrial dispute.
(r) "Strike-Breaker" means any person who obstructs, impedes, or interferes with by force, violence, coercion,
threats or intimidation any peaceful picketing by employees during any labor controversy affecting wages,
hours or conditions of work or in the exercise of the right of self-organization or collective bargaining.
(s) "Strike Area" means the establishment, warehouse, depots, plants or offices, including the sites or premises
used as run-away shops, of the employer struck against, as well as the immediate vicinity actually used by
picketing strikers in moving to and fro before all points of entrance to and exits from said establishment.
(t) "Lockout" means the temporary refusal of an employer to furnish work as a result of a labor or industry
dispute.
(u) "Internal Union Dispute" includes all disputes or grievances arising from any violation of or disagreement
over any provision of the constitution and by-laws of a union, including any violation of the rights and
conditions of union membership provided for in this Code.
(v) "Appeal" means the elevation by an aggrieved party of any decision, order or award of a lower body to a
higher body, by means of a pleading which includes the assignment of errors, memorandum of arguments in
support thereof, and the reliefs prayed for. A mere notice of appeal, therefore, does not constitute the appeal
as herein defined and understood, and shall not stop the running of the period for perfecting an appeal.
(w) "Perfection of an Appeal" includes the filing within the prescribed period, of the memorandum of appeal
containing, among others, the assignment of error/s, the argument in support thereof, the reliefs sought and
posting of the appeal bond.
(x) "Certification Election" means the process of determining, through secret ballot, the sole and exclusive
bargaining agent of the employees in an appropriate bargaining unit, for purposes of collective bargaining.
(y) "Consent Election" means the election voluntarily agreed upon by the parties to determine the issue of
majority representation of all the workers in the appropriate collective bargaining unit.
(z) "Run-Off" refers to an election between the labor unions receiving the two (2) higher number of voters
when a certification election which provides for three (3) or more choices results in no choice receiving a
majority of the valid votes cast, where the total number of votes for all contending unions is at least fifty
percent (50%) of the number of votes cast.
(aa) "Registration of Agreement" refers to the filing of the collective bargaining agreement with the Regional
Office or the Bureau accompanied by verified proof of posting and ratification and payment of fee.
(bb) "Organized Establishment" refers to a firm or company where there is a recognized or certified exclusive
bargaining agent.
(cc) "Registration Proceedings" refer to proceedings involving the application for registration of labor
organizations.
(dd) "Cancellation Proceeding" is the process leading to the revocation of the registration certificate of a labor
organization after due process.
(ee) "Hearing Officers" are officers appointed/designated in the Regional Office and authorized to hear and
decide cases under Section 2 of Republic Act No. 6715 and whose decision is appealable to the Commission.
(ff) "Union Accounts Examiners" are officials in the Bureau or the Industrial Relations Division in the Regional
Office empowered to audit books of accounts of the union.
(gg) "Representation Officer" refer to a person duly authorized to conduct and supervise certification elections
in accordance with Rule VI of this Book.
(hh) "Term of Office" means the tenure of office of elected officials of a labor organization which is for a fixed
period of five (5) years.
(ii) "Cabo" refers to a person or group or persons or to a labor group which, in the guise of a labor
organization, supplies workers to an employer, with or without any monetary or other consideration whether
in the capacity of an agent of the employer or as an ostensible independent contractor.
(jj) "Collective Bargaining Agreement" 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, including mandatory provisions for grievances and arbitration machineries.
(kk) "Med-Arbiter" is an official in the Regional Office authorized to hear, conciliate, mediate and decide
representation cases, internal union and inter-union disputes.
(ll) "Administrator" refers to the Administrator of the Philippine Overseas Employment Administration or the
National Conciliation and Mediation Board as the context so indicates.

RULE II
Registration of Unions
SECTION 1. Who may join unions. — 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.
Supervisory employees and security guards shall not be eligible for membership in a labor organization of the
rank-and-file employees but may join, assist or form separate labor organizations of their own; Provided, that
those supervisory employees who are included in an existing rank-and-file bargaining unit, upon the effectivity
of Republic Act No. 6715, shall remain in that unit; Provided, further, that alien employees with valid working
permits issued by the Department of Labor and Employment may exercise the right to self-organization and
join or assist labor organizations for purposes of collective bargaining if they are nationals of a country which
grants the same or similar rights to Filipino workers, as certified by the Department of Foreign Affairs.
For the purpose of this Section, any employee, whether employed for a definite period or not, shall, beginning
on the first day of his service, be eligible for membership in the union.
SECTION 2. Where to file application; procedure. — Any national labor organization or labor federation or local
union may file an application for registration with the Bureau or the Regional Office where the applicant's
principal office is located. The Bureau or the Regional Office shall immediately process and approve or deny
the application. In case of approval, the Bureau or the Regional Office shall issue the registration certificate
within thirty (30) calendar days from receipt of the application, together with all the requirements for
registration as hereinafter provided.
SECTION 3. Union affiliation; direct membership with national union. — An affiliate of a labor federation or
national union may be a local or chapter thereof or an independently registered union.
(a) The labor federation or national union concerned shall issue a charter certificate indicating the creation or
establishment of a local or chapter, copy of which shall be submitted to the Bureau of Labor Relations within
thirty (30) days from issuance of such charter certificate.
(b) An independently registered union shall be considered an affiliate of a labor federation or national union
after submission to the Bureau of the contract or agreement of affiliation within thirty (30) days after its
execution.
(c) All existing labor federations or national unions are required to submit a list of all their affiliates, their
addresses and including the names and addresses of their respective officials, to the Bureau within thirty (30)
days from effectivity of these Rules.
(d) All existing labor federations or national unions with direct members are required to organize said
members into locals or chapters in their respective companies or establishments within sixty (60) days from
effectivity of these Rules.
(e) The local or chapter of a labor federation or national union shall have and maintain 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.
(f) No person who is not an employee or worker of the company or establishment where an independently
registered union, affiliate, local or chapter of a labor federation or national union operates shall henceforth be
elected or appointed as an officer of such union, affiliate, local or chapter.
SECTION 4. Requirements for registration of local unions; applications. — The application for registration of a
local union shall be signed by at least twenty percent (20%) of the employees in the appropriate bargaining
unit which the applicant union seeks to represent, and shall be accompanied by the following:
(a) Fifty-peso 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) The names of all its members and the number of employees in the bargaining unit;
(d) If the applicant union has been in existence for one or more years, copies of its annual financial reports;
(e) Four copies of its constitution and by-laws, minutes of its adoption or ratification, and the list of the
members who participated in it;
(f) A sworn statement by the applicant union that there is no certified bargaining agent in the bargaining unit
concerned. In case where there is an existing collective bargaining agreement duly submitted to the
Department of Labor and Employment, a sworn statement that the application for registration is filed during
the last sixty (60) days of the agreement; and
(g) The application for registration and all the accompanying documents shall be verified under oath by the
secretary or the treasurer, as the case may be, and attested to by the president.
SECTION 5. Denial of registration of local unions. — The Regional Office of the Bureau may deny the
application for registration on grounds of non-compliance with the requirements enumerated in Section 4
hereof.
The decision of the Regional Office or the Bureau denying the application for registration shall be in writing,
stating in clear terms the reasons therefor. A copy thereof shall be furnished the applicant union.
SECTION 6. Appeal. — Any applicant union may appeal to the Bureau the denial of registration by the Regional
Office, or to the Secretary if the denial is by the Bureau, within ten (10) calendar days from receipt of such
decision on grounds of:
(a) Grave abuse of discretion; and
(b) Gross incompetence.
The appeal shall be filed in the Regional Office/Bureau which shall cause the transmittal of the records to the
Bureau/Secretary within five (5) calendar days from receipt of the appeal.
The Bureau/Secretary shall decide the appeal within twenty (20) calendar days from receipt of the records of
the case.
SECTION 7. Cancellation of registration certificate. — The certificate of registration of any legitimate labor
organization including labor federations or national unions may be cancelled by the Bureau or the Regional
Office on any of the following grounds:
(a) Violation of Articles 234, 237 and 239 of the Code;
(b) Failure to comply with Article 238 of the Code; and
(c) Violation of any of the provisions of Article 241 of the Code.
SECTION 8. Notice of Cancellation. — The Bureau or the Regional Office shall serve a notice of the cancellation
proceedings on the labor organization concerned stating the grounds therefor, at least fifteen (15) calendar
days before the scheduled date of hearing. In such hearing, the representative of the labor organization shall
have the right to present its side.
SECTION 9. Appeal. — The labor organization may, unless the law provides otherwise, within fifteen (15)
calendar days from receipt of the decision cancelling or revoking its certificate of registration, file an appeal to
the Bureau, or in case of cancellation by the Bureau, to the Secretary, on any of the following grounds:
(a) Grave abuse of discretion; and
(b) Gross incompetence.
The Bureau/Secretary shall have fifteen (15) calendar days from receipt of the records of the case within which
to decide the appeal. The decision shall be final and unappealable.
SECTION 10. Rights of labor organizations. — A legitimate labor organization shall have the rights enumerated
in Article 242 of the Code.
SECTION 11. Automatic cancellation of union registration. — (a) The Bureau or the Regional Office shall, after
due process, cancel the certificate of registration of any labor organization which fails to submit the financial
reports required by the Code and its Implementing Rules six (6) months after the effectivity of Republic Act
No. 6715.
(b) The reports required under this section shall be submitted to the Bureau or the Regional Office.

Cases
71. SSS VENTURES INTERNATIONAL v. SSS VENTURES LABOR UNION
FACTS:
Petitioner S.S. Ventures International, Inc. (Ventures), a PEZA- registered export firm. Respondent S.S.
Ventures Labor Union (Union) is a labor organization registered with the DOLE. The Union filed with DOLE-
Region III a petition for certification election in behalf of the rank-and-file employees. Ventures filed a Petition
to cancel the Union’s certificate of registration alleging that the Union deliberately and maliciously included
the names of more or less 82 former employees no longer connected with Ventures in its list of members who
attended the organizational meeting and in the adoption/ratification of its constitution and by-laws; that No
organizational meeting and ratification actually took place; and the Union’s application for registration was
not supported by at least 20% of the rank-and-file employees of Ventures.
Regional Director of DOLE- Region III favored Ventures and resolved to Cancel the Certificate of the union. On
appeal, the BLR Director granted the Union’s appeal and reversing the decision of RD.nVentures went to the
CA. The CA dismissed Ventures’ petition as well as the MR. Hence, this petition for review

ISSUE:
Whether the registration of the Union must be cancelled.

RULING:
NO. The right to form, join, or assist a union is specifically protected by Art. XIII, Section 3 of the Constitution
and such right, according to Art. III, Sec. 8 of the Constitution and Art. 246 of the Labor Code, shall not be
abridged. Once registered with the DOLE, a union is considered a legitimate labor organization endowed with
the right and privileges granted by law to such organization. While a certificate of registration confers a union
with legitimacy with the concomitant right to participate in or ask for certification election in a bargaining unit,
the registration may be canceled or the union may be decertified as the bargaining unit, in which case the
union is divested of the status of a legitimate labor organization. Among the grounds for cancellation is the
commission of any of the acts enumerated in Art. 239(a) of the Labor Code, such as fraud and
misrepresentation in connection with the adoption or ratification of the union’s constitution and like
documents. The Court, has in previous cases, said that to decertify a union,it is not enough to show that the
union includes ineligible employees in its membership. It must also be shown that there was
misrepresentation, false statement, or fraud in connection with the application for registration and the
supporting documents, such as the adoption or ratification of the constitution and by-laws or amendments
thereto and the minutes of ratification of the constitution or by-laws, among other documents.

The evidence presented by Ventures consist mostly of separate hand-written statements of 82 employees who
alleged that they were unwilling or harassed signatories to the attendance sheet of the organizational
meeting. However these evidence was presented seven months after the union filed its petition for
cancellation of registration. Hence these statements partake of the nature of withdrawal of union membership
executed after the Union’s filing of a petition for certification election on March 21, 2000. We have said that
the employees’ withdrawal from a labor union made before the filing of the petition for certification election is
presumed voluntary, while withdrawal after the filing of such petition is considered to be involuntary and does
not affect the same. Now then, if a withdrawal from union membership done after a petition for certification
election has been filed does not vitiate such petition, it is but logical to assume that such withdrawal cannot
work to nullify the registration of the union. The Court is inclined to agree with the CA that the BLR did not
abuse its discretion nor gravely err when it concluded that the affidavits of retraction of the 82 members had
no evidentiary weight.

72. NUWHRAIN-MANILA PAVILION HITEL v. SECRETARY

FACTS:
A certification election was conducted on June 16, 2006 among the rank-and-file employees of respondent
Holiday Inn Manila Pavilion Hotel (the Hotel) with the following results:

EMPLOYEES IN VOTERS’ LIST = 353

TOTAL VOTES CAST = 346
NUWHRAIN-MPHC = 151
HIMPHLU = 169
NO UNION = 1
SPOILED = 3
SEGREGATED = 22

In view of the significant number of segregated votes, contending unions, petitioner, NUHWHRAIN-MPHC, and
respondent Holiday Inn Manila Pavillion Hotel Labor Union (HIMPHLU), referred the case back to Med-Arbiter
to decide which among those votes would be opened and tallied. 11 votes were initially segregated because
they were cast by dismissed employees, albeit the legality of their dismissal was still pending before the Court
of Appeals. Six other votes were segregated because the employees who cast them were already occupying
supervisory positions at the time of the election. Still five other votes were segregated on the ground that they
were cast by probationary employees and, pursuant to the existing Collective Bargaining Agreement (CBA),
such employees cannot vote.
It bears noting early on, however, that the vote of one Jose Gatbonton (Gatbonton), a probationary employee,
was counted.

Med-Arbiter Calabocal ruled for the opening of 17 out of the 22 segregated votes, specially those cast by the
11 dismissed employees and those cast by the six supposedly supervisory employees of the Hotel.

Petitioner, which garnered 151 votes, appealed to the Secretary of Labor and Employment (SOLE), arguing
that the votes of the probationary employees should have been opened considering that probationary
employee Gatbonton’s vote was tallied. And petitioner averred that respondent HIMPHLU, which garnered
169 votes, should not be immediately certified as the bargaining agent, as the openingof the 17 segregated
ballots would push the number of valid votes cast to 338 (151 + 169 + 1 + 17), hence, the 169 votes which
HIMPHLU garnered would be one vote short of the majority which would then become 169.

Secretary affirmed the decision of the med-arbiter. In fine, the SOLE concluded that the certification of
HIMPHLU as the exclusive bargaining agent was proper.

ISSUES:
(1) whether employees on probationary status at the time of the certification elections should be allowed to
vote.
(2) whether HIMPHLU was able to obtain the required majority for it to be certified as the exclusive
bargaining agent.

HELD:
I. On the first issue, the Court rules in the affirmative.
The inclusion of Gatbonton’s vote was proper not because it was not questioned but because probationary
employees have the right to vote in a certification election. The votes of the six other probationary employees
should thus also have been counted. As Airtime Specialists, Inc. v. Ferrer-Calleja holds:

In a certification election, all rank and file employees in the appropriate bargaining unit, whether probationary
or permanent 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 purposes 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.” (Emphasis supplied)

For purposes of this section (Rule II, Sec. 2 of Department Order No. 40-03, series of 2003), any employee,
whether employed for a definite period or not, shall beginning on the first day of his/her service, be eligible
for membership in any labor organization.

All other workers, including ambulant, intermittent and other workers, the self-employed, rural workers and
those without any definite employers may form labor organizations for their mutual aid and protection and
other legitimate purposes except collective bargaining. (Emphasis supplied)

The provision in the CBA disqualifying probationary employees from voting cannot override the
Constitutionally-protected right of workers to self-organization, as well as the provisions of the Labor Code
and its Implementing Rules on certification elections and jurisprudence thereon.A law is read into, and forms
part of, a contract. Provisions in a contract are valid only if they are not contrary to law, morals, good customs,
public order or public policy.

II. 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.
Prescinding from the Court’s ruling that all the probationary employees’ votes should be deemed valid votes
while that of the supervisory employees should be excluded, it follows that the number of valid votes cast
would increase – from 321 to 337. Under Art. 256 of the Labor Code, the union obtaining the majority of the
valid votes cast by the eligible voters shall be certified as the sole and exclusivebargaining agent of all the
workers in the appropriate bargaining unit. This majority is 50% + 1. Hence, 50% of 337 is 168.5 + 1 or at least
170.
HIMPHLU obtained 169 while petitioner received 151 votes. Clearly, HIMPHLU was not able to obtain a
majority vote. The position of both the SOLE and the appellate court that the opening of the 17 segregated
ballots will not materially affect the outcome of the certification election as for, so they contend, even if such
member were all in favor of petitioner, still, HIMPHLU would win, is thus untenable.

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.

73. SAMAHAN NG MGA MANGGAWA SA HANJIN SHIPYARD v. BLR

Facts:
SamahanngManggagawasaHanjin Shipyard (Samahan) filed an application for registration of its name with
DOLE with the list of names of a total of 120 officers and members, signatures of the attendees of the meeting,
copy of their Consi and by-laws. The DOLE Regional Ofice No. 3, City of San Fernand, Pampanga, issued the
corresponding certificate of registration. Respondent Hanjin Heavy Industries and Construction Co., Ltd.
Philippines (Hanjin) prayed for the cancellation of registration of Samahan on the ground that its members do
not fall under any of the times of workers enumerated in Art 249. Hanjin claimed that one third (1/3) of the
members of the association had definite employers and that only ambulant, intermittent, itinerant, rural
workers, self-employed, and those without definite employers may form a workers' association.Hanjin also
claimed that Samahan misrepresented itself when Samahan made it appear that its members where all
qualified to become members of the worker’s association.
The CA opined that Samahan should have formed a union for purposes of collective bargaining instead of a
workers' association.

Issue:
Whether or not Samahan cannot form a Worker’s association of employees.

Ruling:
No. Right to self-organization includes right to form a union, workers' association and labor management
councils.
In the case at bench, the Court cannot sanction the opinion of the CA that Samahan should have formed a
union for purposes of collective bargaining instead of a workers' association because the choice belonged to it.
The right to form or join a labor organization necessarily... includes the right to refuse or refrain from
exercising the said right. It is self-evident that just as no one should be denied the exercise of a right granted
by law, so also, no one should be compelled to exercise such a conferred right.[53] Also inherent... in the right
to self-organization is the right to choose whether to form a union for purposes of collective bargaining or a
workers' association for purposes of providing mutual aid and protection.

74. ATLAS LITOGRAPHIC SERVICES v. LAGUESMA

FACTS:
On July 16, 1990, the supervisory, administrative personnel, production, accounting and confidential
employees of Atlas Lithographic Services Inc (ALSI) affiliated with Kaisahan ng Manggagawang Pilipinom a
national labor organization. The local union adopted the name ALSI-SAPPACEA-KAMPIL, which shall hereafter
refer to as the “supervisors” union.Kampil-Katipunan filed on behalf of the “supervisors” union a petition for
certification election so that it could be the sole and exclusive bargaining agent of the supervisory employees.

ALSI opposed the petition claiming that under Art. 245 of the Labor Code, Kampil-Katipunana cannot represent
the supervisory employees for collective bargaining purposes because it also represents the rank-and-file
employees’ union.

Kampil-Katipunan maintains that Rep. Act No. 6715 contemplates the principle laid down by this Court in the
Adamson case interpreting Section 3 of Rep. Act No. 875 (the Industrial Peace Act) on the right of a
supervisor's union to affiliate. The private respondent asserts that the legislature must have noted the
Adamson ruling then prevailing when it conceived the reinstatement in the present Labor Code of a similar
provision on the right of supervisors to organize.

ISSUE:
WON a local union of supervisory employees may be allowed to affiliate with a national federation of labor
organization of rank-and-file employees where such federation represents its affiliates in the collective
bargaining negotiation with the same employer of the supervisors and in the implementation of the CBAs.
HELD:
NO, 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 or their joining in a federation of rank-and-file employees
that includes the very local union which they are not allowed to directly join.
The basis of the Adamson case is R.A. No. 875 (Industrial Peace Act) where employees were classified into
three groups, namely: 1) managerial employees; 2) supervisors; and 3) rank-and-file employees. Supervisors
who were considered employees in relation to their employer could join a union but not a union of rank-and-
file employees.

A revision of the Labor Code undertaken by the bicameral Congress brought about the enactment of Rep. Act
No. 6715 in March 1989 in which employees were reclassified into three groups, namely: (1) the managerial
employees; (2) supervisors; and (3) the rank and file employees. Under the present law, the category of
supervisory employees is once again recognized. Hence, Art. 212 (m) states:
(m) . . . 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. . . .
The rationale for the amendment is the government's recognition of the right of supervisors to organize with
the qualification that they shall not join or assist in the organization of rank-and-file employees. The reason
behind the Industrial Peace Act provision on the same subject matter has been adopted in the present statute.
The interests of supervisors on the one hand, and the rank-and-file employees on the other, are separate and
distinct. The functions of supervisors, being recommendatory in nature, are more identified with the interests
of the employer. The performance of those functions may, thus, run counter to the interests of the rank-and-
file.This intent of the law is made clear in the deliberations of the legislators on then Senate Bill 530 now
enacted as Rep. Act No. 6715.

LABOR ORGANIZATIONS AND REGISTRATION OF UNIONS

Labor Code
Article 219-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.
Article 219- h. "Legitimate labor organization" means any labor organization duly registered with the
Department of Labor and Employment, and includes any branch or local thereof.

Article 237. [231] Registry of Unions and File of Collective Bargaining Agreements.180 The Bureau shall keep
a registry of legitimate labor organizations.
The Bureau shall also maintain a file of all collective bargaining agreements and other related agreements and
records of settlement of labor disputes and copies of orders and decisions of voluntary arbitrators or panel of
voluntary arbitrators. The file shall be open and accessible to interested parties under conditions prescribed by
the Secretary of Labor and Employment, provided that no specific information submitted in confidence shall
be disclosed unless authorized by the Secretary, or when it is at issue in any judicial litigation, or when public
interest or national security so requires.
Within thirty (30) days from the execution of a Collective Bargaining Agreement, the parties shall submit
copies of the same directly to the Bureau or the Regional Offices of the Department of Labor and Employment
for registration accompanied with verified proofs of its posting in two conspicuous places in the place of work
and ratification by the majority of all the workers in the bargaining unit. The Bureau or Regional Offices shall
act upon the application for registration of such Collective Bargaining Agreement within five (5) calendar days
from receipt thereof. The Regional Offices shall furnish the Bureau with a copy of the Collective Bargaining
Agreement within five (5) days from its submission.
The Bureau or Regional Office shall assess the employer for every Collective Bargaining Agreement a
registration fee of not less than one thousand pesos (P1,000.00) or in any other amount as may be deemed
appropriate and necessary by the Secretary of Labor and Employment for the effective and efficient
administration of the Voluntary Arbitration Program. Any amount collected under this provision shall accrue
to the Special Voluntary Arbitration Fund.
The Bureau shall also maintain a file, and shall undertake or assist in the publication of all final decisions,
orders and awards of the Secretary of Labor and Employment, Regional Directors and the Commission.

Article 240-251.
ART. 240. [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.
ART. 241. [234-A] Chartering and Creation of a Local Chapter. A duly registered federation or national union
may directly create a local chapter by issuing a charter certificate indicating the establishment of the local
chapter. The chapter shall acquire legal personality only for purposes of filing a petition for certification
election from the date it was issued a charter certificate.
182 Renumbered as Arts. 264, 265, and 268, respectively.
183 As amended by Sec. 1 of R.A. No. 9481 (2007), An Act Strengthening the Workers' Constitutional Right to
Self-Organization. 184 Inserted as a new provision pursuant to Sec. 2 of R.A. No. 9481 (2007).

The chapter shall be entitled to all other rights and privileges of a legitimate labor organization only upon the
submission of the following documents in addition to its charter certificate:
(a) The names of the chapter's officers, their addresses, and the principal office of the chapter; and
(b) The chapter's constitution and by-laws: Provided, That where the chapter's constitution and by-laws are
the same as that of the federation or the national union, this fact shall be indicated accordingly.
The additional supporting requirements shall be certified under oath by the secretary or treasurer of the
chapter and attested by its president.
ART. 242. [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.
ART. 243. [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.
ART. 244. [237] Additional Requirements for Federations or National Unions. Subject to Article 238,185 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:
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
The names and addresses of the companies where the locals or chapters operate and the list of all the
members in each company involved.
ART. 245. [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.187
ART. 246. [238-A] Effect of a Petition for Cancellation of Registration. A petition for cancellation of union
registration shall not suspend the proceedings for certification election nor shall it prevent the filing of a
petition for certification election.
In case of cancellation, nothing herein shall restrict the right of the union to seek just and equitable remedies
in the appropriate courts.
ART. 247. [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.
ART. 248. [239-A] Voluntary Cancellation of Registration. The registration of a legitimate labor organization
may be cancelled by the organization itself: Provided, That at least two-thirds of its general membership votes,
in a meeting duly called for that purpose to dissolve the organization: Provided, further, That an application to
cancel registration is thereafter submitted by the board of the organization, attested to by the president
thereof.
ART. 249. [240] Equity of the Incumbent. All existing federations and national unions which meet the
qualifications of a legitimate labor organization and none of the grounds for cancellation shall continue to
maintain their existing affiliates regardless of the nature of the industry and the location of the affiliates.
ART. 250. [241] Rights and Conditions of Membership in a Labor Organization. The following are the rights
and conditions of membership in a labor organization:
(a) No arbitrary or excessive initiation fees shall be required of the members of a legitimate labor organization
nor shall arbitrary, excessive or oppressive fine and forfeiture be imposed;
(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;
(c) The members shall directly elect their officers in the local union, as well as their national officers in the
national union or federation to which they or their local union is affiliated, by secret ballot at intervals of five
(5) years. No qualification requirement 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;
(d) The members shall determine by secret ballot, after due deliberation, any question of major policy
affecting the entire membership of the organization, unless the nature of the organization or force majeure
renders such secret ballot impractical, in which case, the board of directors of the organization may make the
decision in behalf of the general membership;
(e) No labor organization shall knowingly admit as members or continue in membership any individual who
belongs to a subversive organization or who is engaged directly or indirectly in any subversive activity;
(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;
(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;
(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.
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;
(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;
(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,
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
(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.
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 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.
ART. 251. [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.
Article 292(a) Miscellaneous Provisions. 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.

Omnibus Rules, Book V, Rule I

Section 1. . Definition of Terms.
(a) “Abstention” refers to a blank or unfilled ballot validly cast by an eligible voter. It is not considered as a
negative vote. However, it shall be considered in the counting for purposes of determining a valid election.
(n) “Deregistration of Agreement” refers to the legal process leading to the revocation of CBA registration.
(o) “Department” refers to the Department of Labor and Employment.
(p) “Election Officer” refers to an officer of the Bureau or Labor Relations Division in the Regional Office
authorized to conduct certification elections, election of union officers and other forms of elections and
referenda in accordance with Rule XII, Sections 2-5 of these Rules.
(w) “Improved Offer Balloting” refers to a referendum by secret ballot involving union members on the
improved offer of the employer on or before the 30th day of a strike.
(cc) “Intra-Union Dispute” refers to any conflict between and among union members, including grievances
arising from any violation of the rights and conditions of membership, violation of or disagreement over any
provision of the union’s constitution and by-laws, or disputes arising from chartering or affiliation of union.
(ee) “Labor Relations Division” refers to the (1) Labor Organization and CBA Registration Unit and (2) Med-
Arbitration Unit in the Regional Office. The Labor Organization and CBA Registration Unit is in charge of
processing the applications for registration of independent unions, chartered locals, workers associations and
collective bargaining agreements, maintaining said records and all other reports and incidents pertaining to
labor organizations and workers’ associations. The Med- Arbitration Unit conducts hearings and decides
certification election or representation cases, inter/intra-union and other related labor relations disputes.
(ff) “Legitimate Labor Organization” refers to any labor organization in the private sector registered or
reported with the Department in accordance with Rules III and IV of these Rules.
(jj) “Mediator-Arbiter” refers to an officer in the Regional Office or in the Bureau authorized to hear and
decide representation cases, inter/intra-union disputes and other related labor relations disputes, except
cancellation of union registration cases.
(kk) “Merger” refers to a process where a labor organization absorbs another resulting in the cessation of the
absorbed labor organization’s existence, and the continued existence of the absorbing labor organization.
(zz) “Strike Vote Balloting” refers to the secret balloting undertaken by the members of the union in the
bargaining unit concerned to determine whether or not to declare a strike in meetings or referenda called for
that purpose.
(ccc) “Union” refers to any labor organization in the private sector organized for collective bargaining and for
other legitimate purposes.

Rule III-V, XIV-XV, as amended by DO 40-03, as further amended by DO 40-B

RULE III
REGISTRATION OF LABOR ORGANIZATIONS
Section 1. Where to file. – Applications for registration of independent labor unions, chartered locals, workers’
associations shall be filed with the Regional Office where the applicant principally operates. It shall be
processed by the Labor Relations Division at the Regional Office in accordance with Sections 2-A, 2-C, and 2-E
of this Rule.
Applications for registration of federations, national unions or workers’ associations operating in more than
one region shall be filed with the Bureau or the Regional Offices, but shall be processed by the Bureau in
accordance with Sections 2-B and 2-D of this Rule.
Section 2. Requirements for application. – A. The application for registration of an independent labor union
shall be accompanied by the following documents:
1) the name of the applicant labor union, its principal address, the name of its officers and their respective
addresses, approximate number of employees in the bargaining unit where it seeks to operate, with a
statement that it is not reported as a chartered local of any federation or national union;
2) the minutes of the organizational meeting(s) and the list of employees who participated in the said
meeting(s);
3) the name of all its members comprising at least 20% of the employees in the bargaining unit;
4) the annual financial reports if the applicant has been in existence for one or more years, unless it has not
collected any amount from the members, in which case a statement to this effect shall be included in the
application;
5) the applicant’s constitution and by-laws, minutes of its adoption or ratification, and the list of the members
who participated in it. The list of ratifying members shall be dispensed with where the constitution and by-
laws was ratified or adopted during the organizational meeting. In such a case, the factual circumstances of
the ratification shall be recorded in the minutes of the organizational meeting(s).
B. The application for registration of federations and national unions shall be accompanied by the following
documents:
1) a statement indicating the name of the applicant labor union, its principal address, the name of its officers
and their respective addresses;
2) the minutes of the organizational meeting(s) and the list of employees who participated in the said
meeting(s);
3) the annual financial reports if the applicant union has been in existence for one or more years, unless it has
not collected any amount from the members, in which case a statement to this effect shall be included in the
application;
4) the applicant union’s constitution and by-laws, minutes of its adoption or ratification, and the list of the
members who participated in it. The list of ratifying members shall be dispensed with where the constitution
and by-laws was ratified or adopted during the organizational meeting(s). In such a case, the factual
circumstances of the ratification shall be recorded in the minutes of the organizational meeting(s);
5) the resolution of affiliation of at least ten (10) legitimate labor organizations, whether independent unions
or chartered locals, each of which must be a duly certified or recognized bargaining agent in the establishment
where it seeks to operate; and
6) the name and addresses of the companies where the affiliates operate and the list of all the members in
each company involved.
Labor organizations operating within an identified industry may also apply for registration as a federation or
national union within the specified industry by submitting to the Bureau the same set of documents.
C. The application for registration of a workers’ association shall be accompanied by the following documents:
1) the name of the applicant association, its principal address, the name of its officers and their respective
addresses;
2) the minutes of the organizational meeting(s) and the list of members who participated therein;
3) the financial reports of the applicant association if it has been in existence for one or more years, unless it
has not collected any amount from the members, in which case a statement to this effect shall be included in
the application;
4) the applicant’s constitution and by-laws to which must be attached the names of ratifying members, the
minutes of adoption or ratification of the constitution and by- laws and the date when ratification was made,
unless ratification was done in the organizational meeting(s), in which case such fact shall be reflected in the
minutes of the organizational meeting(s).
D. Application for registration of a workers’ association operating in more than one region shall be
accompanied, in addition to the requirements in the preceding subsection, by a resolution of membership of
each member association, duly approved by its board of directors.
E. “A duly-registered federation or national union may directly create a local/chapter by issuing a charter
certificate indicating the establishment of the local/chapter. The local/chapter shall acquire legal personality
only for purposes of filing a petition for certification election from the date it was issued a charter certificate.
The local/chapter shall be entitled to all other rights and privileges of a legitimate labor organization only upon
the submission of the following documents in addition to its charter certificate:
(a) The names of the local/chapter’s officers, their addresses, and the principal office of the local/chapter; and
(b) The chapter’s constitution and by-laws provided, that where the chapter’s constitution and by-laws are the
same as that of the federation or the national union, this fact shall be indicated accordingly.
The genuineness and due execution of the supporting requirements shall be certified under oath by the
Secretary or Treasurer of the local/chapter and attested to by its President.”
Section 3. Notice of change of name of labor organizations; Where to file. – The notice for change of name of a
registered labor organization shall be filed with the Bureau or the Regional Office where the concerned labor
organization’s certificate of registration or certificate of creation of a chartered local was issued.
Section 4. Requirements for notice of change of name. – The notice for change of name of a labor organization
shall be accompanied by the following documents:
(a) proof of approval or ratification of change of name; and (b) the amended constitution and by-laws.
Section 5. Certificate of Registration/Certificate of Creation of Chartered Local for change of name. – The
certificate of registration and the certificate of creation of a chartered local issued to the labor organization for
change of name shall bear the same registration number as the original certificate issued in its favor and shall
indicate the following: (a) the new name of the labor organization; (b) its former name; (c) its office or
business address; and (d) the date when the labor organization acquired legitimate personality as stated in its
original certificate of registration/certificate of creation of chartered local.
Section 6. Report of affiliation with federations or national unions; Where to file. – The report of affiliation of
an independently registered labor union with a federation or national union shall be filed with the Regional
Office that issued its certificate of registration.
Section 7. Requirements of affiliation. – The report of affiliation of independently registered labor unions with
a federation or national union shall be accompanied by the following documents:
(a) resolution of the labor union’s board of directors approving the affiliation;
(b) minutes of the general membership meeting approving the affiliation;
(c) the total number of members comprising the labor union and the names of members who approved the
affiliation;
(d) the certificate of affiliation issued by the federation in favor of the independently registered labor union;
and
(e) written notice to the employer concerned if the affiliating union is the incumbent bargaining agent.
Section 8. Notice of Merger/Consolidation of labor organizations; Where to file. – Notice of merger or
consolidation of independent labor unions, chartered locals and workers’ associations shall be filed with and
recorded by the Regional Office that issued the certificate of registration/certificate of creation of chartered
local of either the merging or consolidating labor organization. Notice of merger or consolidation of
federations or national unions shall be filed with and recorded by the Bureau.
Section 9. Requirements of notice of merger. – The notice of merger of labor organizations shall be
accompanied by the following documents:
(a) the minutes of merger convention or general membership meeting(s) of all the merging labor
organizations, with the list of their respective members who approved the same; and
(b) the amended constitution and by-laws and minutes of its ratification, unless ratification transpired in the
merger convention, which fact shall be indicated accordingly.
Section 10. Certificate of Registration. – The certificate of registration issued to merged labor organizations
shall bear the registration number of one of the merging labor organizations as agreed upon by the parties to
the merger.
The certificate of registration shall indicate the following: (a) the new name of the merged labor organization;
(b) the fact that it is a merger of two or more labor organizations; (c) the name of the labor organizations that
were merged; (d) its office or business address; and (e) the date when each of the merging labor organizations
acquired legitimate personality as stated in their respective original certificate of registration.
Section 11. Requirements of notice of consolidation. – The notice of consolidation of labor organizations shall
be accompanied by the following documents:
(a) the minutes of consolidation convention of all the consolidating labor organizations, with the list of their
respective members who approved the same; and
(b) the amended constitution and by-laws, minutes of its ratification transpired in the consolidation
convention or in the same general membership meeting(s), which fact shall be indicated accordingly.
Section 12. Certificate of Registration. – The certificate of registration issued to a consolidated labor
organization shall bear the registration number of one of the consolidating labor organizations as agreed upon
by the parties to the consolidation.
The certificate of registration shall indicate the following (a) the new name of the consolidated labor
organization; (b) the fact that it is a consolidation of two or more labor organizations; (c) the name of the labor
organizations that were consolidated; (d) its office or business address; and (e) the date when each of the
consolidating labor organizations acquired legitimate personality as stated in their respective original
certificates of registration.
RULE IV
PROVISIONS COMMON TO THE REGISTRATION OF LABOR ORGANIZATIONS AND WORKERS ASSOCIATION
Section 1. Attestation requirements. – The application for registration of labor unions and workers’
associations, notice for change of name, merger, consolidation and affiliation including all the accompanying
documents, shall be certified under oath by its Secretary or Treasurer, as the case may be, and attested to by
its President.
Section 2. Payment of registration fee. – A labor union and workers’ association shall be issued a certificate of
registration upon payment of the prescribed registration fee.
Section 3. Accompanying documents. – One (1) original copy and two (2) duplicate copies of all documents
accompanying the application or notice shall be submitted to the Regional Office or the Bureau.
Section 4. Action on the application/notice. – The Regional Office or the Bureau, as the case may be, shall act
on all applications for registration or notice of change of name, affiliation, merger and consolidation within
one (1) day from receipt thereof, either by: (a) approving the application and issuing the certificate of
registration/acknowledging the notice/report; or (b) denying the application/notice for failure of the applicant
to comply with the requirements for registration/notice.”
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 one (1) day from
receipt of the application/notice, notify the applicant/labor organization concerned in writing of the necessary
requirements and to 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.
Section 7. Procedure on appeal. – The memorandum of appeal shall be filed with the Regional Office or the
Bureau that issued the denial/return of notice. The memorandum of appeal together with the complete
records of the application for registration/notice of change of name, affiliation, merger or consolidation, shall
be transmitted by the Regional Office to the Bureau or by the Bureau to the Office of the Secretary, within
twenty-four (24) hours from receipt of the memorandum of appeal.
The Bureau or the Office of the Secretary shall decide the appeal within twenty (20) days from receipt of the
records of the case.
Section 8. Effect of registration. – The labor union or workers’ association shall be deemed registered and
vested with legal personality on the date of issuance of its certificate of registration or certificate of creation of
chartered local.
Such legal personality may be questioned only through an independent petition for cancellation of union
registration in accordance with Rule XIV of these Rules, and not by way of collateral attack in petition for
certification election proceedings under Rule VIII.
Section 9. Effect of change of name. – The change of name of a labor organization shall not affect its legal
personality. All the rights and obligations of a labor organization under its old name shall continue to be
exercised by the labor organization under its new name.
Section 10. Effect of merger or consolidation. – Where there is a merger of labor organizations, the legal
existence of the absorbed labor organization(s) ceases, while the legal existence of the absorbing labor
organization subsists. All the rights, interests and obligations of the absorbed labor organizations are
transferred to the absorbing organization.
Where there is consolidation, the legal existence of the consolidating labor organizations shall cease and a
new labor organization is created. The newly created labor organization shall acquire all the rights, interests
and obligations of the consolidating labor organizations.

RULE V
REPORTING REQUIREMENTS OF LABOR UNIONS AND WORKERS ASSOCIATIONS
Section 1. Reporting requirements. – It shall be the duty of every legitimate labor unions and workers’
association to submit to the Regional Office or the Bureau which issued its certificate of registration or
certificate of creation of local/chapter, as the case may be, two (2) copies of each of the following documents:
(a) its constitution and by-laws or amendments thereto, the minutes of adoption or ratification and the list of
members who took part therein, within thirty (30) days from its adoption or ratification;
(b) its list of elected and appointed officers and agents entrusted with the handling of union funds, the
minutes of election of officers, and the list of voters, within thirty (30) days from the date of election or
appointment;
(c) its annual financial report within thirty (30) days after the close of every fiscal year; and
(d) its list of members at least once a year or whenever required by the Bureau.
The fiscal year of a labor organization shall coincide with the calendar year unless a different period is
provided in its constitution and by-laws.

RULE XIV
CANCELLATION OF REGISTRATION OF LABOR ORGANIZATIONS
Section 1. Cancellation of registration; Where to file. – Subject to the requirements of notice and due process,
the registration of any legitimate independent labor union, local/chapter and workers’ association may be
cancelled by the Regional Director upon the filing of a petition for cancellation of union registration, or
application by the organization itself for voluntary dissolution.
The petition for cancellation or application for voluntary dissolution shall be filed in the Regional Office which
issued its certificate of registration or creation.
In the case of federations, national or industry unions and trade union centers, the Bureau Director may cancel
the registration upon the filing of a petition for cancellation or application for voluntary dissolution in the
Bureau of Labor Relations. (as amended by D.O. 40-F- 08)
Section 2. Who may file. – Any party-in-interest may commence a petition for cancellation of registration,
except in actions involving violations of Article 250 (renumbered), which can only be commenced by members
of the labor organization concerned.
Section 3. Grounds for cancellation. – Any of the following may constitute as ground/s for cancellation of
registration of labor organizations:
(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;
(b) misrepresentation, false statements or fraud in connection with the election of officers, minutes of the
election of officers, and the list of voters; or
(c) voluntary dissolution by the members.
Section 4. Voluntary Cancellation of Registration: How Made. - A legitimate labor organization may cancel its
registration provided at least two thirds (2/3) of its general membership votes to dissolve the organization in a
meeting duly called for that purpose and an application to cancel its registration is thereafter submitted by the
board of the organization to the Regional/Bureau Director, as the case may be. The application shall be
attested to by the president of the organization.
Section 5. Action on the petition/application. – The petition/application shall be acted upon by the
Regional/Bureau Director, as the case may be. In case of a petition for cancellation of registration, the formal
requirements, processes and periods of disposition stated in Rule XI shall be followed in the determination of
the merits of the petition. (as amended by D.O. 40-F-08)
Section 6. Prohibited grounds for cancellation of registration. - The inclusion as union members of employees
who are outside the bargaining unit shall not be a ground to cancel the union registration. The ineligible
employees are automatically deemed removed from the list of membership of the union.
The affiliation of the rank-and-file and supervisory unions operating within the same establishment to the
same federation or national union shall not be a ground to cancel the registration of either union.

RULE XV
REGISTRY OF LABOR ORGANIZATIONS AND COLLECTIVE BARGAINING AGREEMENTS
Section 1. National Registry. – The Bureau shall be the national registry of labor organizations and collective
bargaining agreements. As such it shall:
(a) maintain a national registry;
(b) within the month of March following the end of the calendar year, publish in the Department of Labor and
Employment website the lists of labor organizations and federations which have complied with the reportorial
requirements of Rule V and delinquent labor organizations;
(c) publish a list of officers of labor organizations with criminal conviction by final judgment; and
(d) verify the existence of a registered labor organization with no registered collective bargaining agreement
and which has not been complying with the reportorial requirements for at least five years. The verification
shall observe the following process:
1) The Regional Office shall make a report of the labor organization’s non- compliance and submit the same to
the Bureau for verification. 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 service of the first notice, it shall
send another notice for compliance, with warning that failure on its part to comply with the reportorial
requirements within the time specified shall cause its publication as a non-existing labor organization in the
DOLE website.
2) Where no response is received by the Bureau within thirty (30) days from service of the second notice, the
Bureau shall publish the notice of non-existence of the labor organization/s in the DOLE website.
3) 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 delist the labor organization from the
roster of legitimate labor organizations.

Labor Code
Article 240. [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.

Article 241. [234-A] Chartering and Creation of a Local Chapter. A duly registered federation or national
union may directly create a local chapter by issuing a charter certificate indicating the establishment of the
local chapter. The chapter shall acquire legal personality only for purposes of filing a petition for certification
election from the date it was issued a charter certificate.
The chapter shall be entitled to all other rights and privileges of a legitimate labor organization only upon the
submission of the following documents in addition to its charter certificate:
(a) The names of the chapter's officers, their addresses, and the principal office of the chapter; and
(b) The chapter's constitution and by-laws: Provided, That where the chapter's constitution and by-laws are
the same as that of the federation or the national union, this fact shall be indicated accordingly.
The additional supporting requirements shall be certified under oath by the secretary or treasurer of the
chapter and attested by its president.
Article 245. [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.1

Article 246. [238-A] Effect of a Petition for Cancellation of Registration. A petition for cancellation of union
registration shall not suspend the proceedings for certification election nor shall it prevent the filing of a
petition for certification election.
In case of cancellation, nothing herein shall restrict the right of the union to seek just and equitable remedies
in the appropriate courts.

Article 247. [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 248. [239-A] Voluntary Cancellation of Registration. The registration of a legitimate labor organization
may be cancelled by the organization itself: Provided, That at least two-thirds of its general membership votes,
in a meeting duly called for that purpose to dissolve the organization: Provided, further, That an application to
cancel registration is thereafter submitted by the board of the organization, attested to by the president
thereof.

Article 252. [242-A] Reportorial Requirements. The following are documents required to be submitted to the
Bureau by the legitimate labor organization concerned:
(a) Its constitution and by-laws, or amendments thereto, the minutes of ratification, and the list of members
who took part in the ratification of the constitution and by-laws within thirty (30) days from adoption or
ratification of the constitution and by-laws or amendments thereto;
(b) Its list of officers, minutes of the election of officers, and list of voters within thirty (30) days from election;
(c) Its annual financial report within thirty (30) days after the close of every fiscal year; and
(d) Its list of members at least once a year or whenever required by the Bureau.
Failure to comply with the above requirements shall not be a ground for cancellation of union registration but
shall subject the erring officers or members to suspension, expulsion from membership, or any appropriate
penalty.

DO No. 40-F-03, series of 2008

[Hi Labor Four!  Since buong DO talaga ang hinihingi, upload nalang ako separate file.. ]

Cases:
75. SAN MIGUEL CORP. EMPLOYEE UNION v. SAN MIGUEL PACKAGING
FACTS:
San Miguel Corporation Employees Union-Philippine Transport and General Workers Organization (SMCEU-
PTGWO) is the incumbent bargaining agent for the bargaining unit comprised of the regular monthly-paid rank
and file employees of the three divisions of San Miguel Corporation (SMC), namely, the San Miguel Corporate
Staff Unit (SMCSU), San Miguel Brewing Philippines (SMBP), and the San Miguel Packaging Products (SMPP), in
all offices and plants of SMC while San Miguel Packaging Products Employees Union–Pambansang Diwa ng
Manggagawang Pilipino (SMPPEU–PDMP) is registered as a chapter of Pambansang Diwa ng Manggagawang
Pilipino (PDMP). SMCEU-PTGWO filed a petition for the cancellation of SMPPEU’s registration and its dropping
from the rolls of legitimate labor organizations alleging that SMPPEU committed fraud and falsification in
obtaining its certificate of registration and that PDMP does not have the power to create a local or a chapter
since it is a trade union center. It was also found by the regional director that SMPPEU failed to comply with
the 20% % membership requirement under the Labor Code.

ISSUES:
(1) Is SMPPEU, a chapter, required to comply with the 20% membership requirement under the Labor Code?
(2) May PDMP, a trade union center, validly create local and chapters?

HELD:
(1) No. The creation of a branch, local or chapter is treated differently. The Court, in the landmark case of
Progressive Development Corporation v. Secretary, Department of Labor and Employment, declared that
when an unregistered union becomes a branch, local or chapter, some of the aforementioned requirements
for registration are no longer necessary or compulsory. Whereas an applicant for registration of an
independent union is mandated to submit, among other things, the number of employees and names of all its
members comprising at least 20% of the employees in the bargaining unit where it seeks to operate, as
provided under Article 234 of the Labor Code and Section 2 of Rule III, Book V of the Implementing Rules, the
same is no longer required of a branch, local or chapter. The intent of the law in imposing less 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.
(2) No. After an exhaustive study of the governing labor law provisions, both statutory and regulatory, the
court finds no legal justification to support the conclusion that a trade union center is allowed to directly
create a local or chapter through chartering. Department Order No. 9 mentions two labor organizations either
of which is allowed to directly create a local or chapter through chartering – a duly registered federation or a
national union. Department Order No. 9 defines a "chartered local" as a labor organization in the private
sector operating at the enterprise level that acquired legal personality through a charter certificate, issued
by a duly registered federation or national union and reported to the Regional Office in accordance with
Rule III, Section 2-E of these Rules.

Article 234 now includes the term trade union center, but interestingly, the provision indicating the procedure
for chartering or creating a local or chapter, namely Article 234- A, still makes no mention of a "trade union
center. Also worth emphasizing is that even in the most recent amendment of the implementing rules,there
was no mention of a trade union center as being among the labor organizations allowed to charter.

The Court deems it proper to apply the Latin maxim expressio unius est exclusio alterius. Under this maxim of
statutory interpretation, the expression of one thing is the exclusion of another. When certain persons or
things are specified in a law, contract, or will, an intention to exclude all others from its operation may be
inferred. If a statute specifies one exception to a general rule or assumes to specify the effects of a certain
provision, other exceptions or effects are excluded.

76. THE HERITAGE HOTEL MANILA v. PIGLAS HERITAGE

Facts:
Sometime in 2000, certain rank and file employees of petitioner Heritage Hotel Manila formed the Heritage
Hotel Employees Union (the HHE union). DOLE-NCR issued a certificate of registration to this union. the HHE
union filed a petition for certification election. petitioner company opposed, alleging that the HHE union
misrepresented itself to be an independent union, when it was, in truth, a local chapter of the
NUWHRAIN. the company also filed a petition for the cancellation of the HHE unions registration certificate.
the Med-Arbiter granted the HHE unions petition for certification election. Petitioner appealed to the
Secretary of Labor but the latter denied the appeal and the motion for reconsideration, prompting the
company to file a petition for certiorari with the Court of Appeals. the CA issued a writ of injunction against
the holding of the HHE unions certification election, effective until the petition for cancellation of that unions
registration shall have been resolved with finality. The decision of the CA became final when the HHE union
withdrew the petition for review that it filed with this Court.

On December 10, 2003 certain rank and file employees of petitioner company formed another union, the
respondent Pinag-Isang Galing at Lakas ng mga Manggagawa sa Heritage Manila (the PIGLAS union). This
union applied for registration with the DOLE-NCR and got its registration certificate. later, the members of the
first union, the HHE union, adopted a resolution for its dissolution. The HHE union then filed a petition for
cancellation of its union registration.

On September 4, 2004 respondent PIGLAS union filed a petition for certification election, that petitioner
company also opposed, alleging that the new unions officers and members were also those who comprised
the old union. According to the company, the employees involved formed the PIGLAS union to circumvent the
Court of Appeals injunction against the holding of the certification election sought by the former union.
Despite the companys opposition, however, the Med-Arbiter granted the petition for certification election.
petitioner company filed a petition to cancel the union registration of respondent PIGLAS union. The company
claimed that the documents submitted with the unions application for registration bore false information.

Petitioner company alleged that the misrepresentation was evidenced by the discrepancy in the number of
union members appearing in the application and the list as well as in the number of signatories to the
attendance and signature sheets. The company further alleged that 33 members of respondent PIGLAS union
were members of the defunct HHE union. This, according to the company, violated the policy againstdual
unionism and showed that the new union was merely an alter ego of the old.

ISSUE:
Whether or not the respondent union committed misrepresentation in its application for union registration.

Ruling:
No. The Labor Code and its implementing rules do not require that the number of members appearing on the
documents in question should completely dovetail. For as long as the documents and signatures are shown to
be genuine and regular and the constitution and by- laws democratically ratified, the union is deemed to have
complied with registration requirements.

Petitioner company claims that respondent PIGLAS union was required to submit the names of all its members
comprising at least 20 percent of the employees in the bargaining unit. Yet the list it submitted named only
100 members notwithstanding that the signature and attendance sheets reflected a membership of 127 or
128 employees. This omission, said the company, amounted to material misrepresentation that warranted the
cancellation of the unions registration.

But, as the labor authorities held, this discrepancy is immaterial. A comparison of the documents shows that,
except for six members, the names found in the subject list are also in the attendance and signature sheets.
Notably, the bargaining unit that respondent PIGLAS union sought to represent consisted of 250 employees.
Only 20 percent of this number or 50 employees were required to unionize. Here, the union more than
complied with such requirement.

Labor laws are liberally construed in favor of labor especially if doing so would affirm its constitutionally
guaranteed right to self-organization. Here, the PIGLAS unions supporting documents reveal the unmistakable
yearning of petitioner companys rank and file employees to organize. This yearning should not be frustrated
by inconsequential technicalities.

77. EAGLE RIDGE GOLF AND COUNTRY CLUB v. CA

Doctrine: Art. 234[c] requires the list of names of all the union members of an INDEPENDENT UNION
comprising at least 20% of the bargaining unit. This should not be equated with the list of workers who
participated in the organizational meetings (Art.234 [b]). Subsequent affidavits of retraction (withdrawal of
membership) will not retroact to the time of application for registration or even way back to the
organizational meeting.

Facts: Eagle Ridge Employees Union (EREU or Union) filed a petition for certification election in Eagle Ridge
Golf & Country Club. Eagle Ridge opposed this petition, followed by its filing of a petition for the
cancellation of certificate of registration claiming misrepresentation, false statement, or fraud to EREU in
connection with the adoption of its constitution and by-laws, the numerical composition of the Union, and the
election of its officers.

Eagle Ridge alleged that the EREU declared in its application for registration having 30 members, when the
minutes of its December 6, 2005 organizational meeting showed it only had 26 members. Also, Eagle Ridge
contended that five employees who attended the organizational meeting had manifested the desire to
withdraw from the union. The five executed individual affidavits or Sinumpaang Salaysay.
ISSUE:
Whether or not the separation of members from the Union can detrimentally affect the registration of the
Union.
HELD:
No. The fact that six union members, indeed, expressed the desire to withdraw their membership through
their affidavits of retraction will not cause the cancellation of registration on the ground of violation of Art.
234(c) of the Labor Code requiring the mandatory minimum 20% membership of rank-and-file employees in
the employees' union.

Twenty percent (20%) of 112 rank-and-file employees in Eagle Ridge would require a union membership of at
least 22 employees (112 x 205 = 22.4). When the EREU filed its application for registration on December 19,
2005, there were clearly 30 union members. Thus, when the certificate of registration was granted, there is no
dispute that the Union complied with the mandatory 20% membership requirement.
Besides, it cannot be argued that the six affidavits of retraction retroact to the time of the application of
registration or even way back to the organizational meeting. Prior to their withdrawal, the six employees in
question were bona fide union members.
With the withdrawal of six union members, there is still compliance with the mandatory membership
requirement under Art. 234(c), for the remaining 24 union members constitute more than the 20%
membership requirement of 22 employees.

78. SAMAHANG MANGGAGAWA SA CHARTER CHEMICAL v. CHARTER CHEMICAL AND COATING

Doctrine: The inclusion of supervisory employees in a labor organization seeking to represent the bargaining
unit of rank-and-file employees does not divest it of its status as a legitimate labor organization.
FACTS:
Samahang Manggagawa sa Charter Chemical Solidarity of Unions in the Philippines for Empowerment and
Reforms (petitioner union) filed a petition for certification election among the regular rank-and-file employees
of Charter Chemical and Coating Corporation (respondent company) with the Mediation Arbitration Unit of
the DOLE, National CapitalRegion.

Med-Arbiter’s Ruling
Dismissed the petition for certification election. It held that the list of membership of petitioner union
consisted of 12 batchman, mill operator and leadman who performed supervisory functions. Under Article
245 of the Labor Code, said supervisory employees are prohibited from joining petitioner union which seeks
to represent the rank-and-file employees of respondent company. As a result, not being a legitimate labor
organization, petitioner union has no right to file a petition for certification election for the purpose of
collective bargaining.

Department of Labor and Employment’s Ruling Allowed the certification election among the regular rank-and-
file employees. There was no independent evidencepresentedtoestablishrespondent company’s claim that
some members of petitioner union were holding supervisory position.

Court of Appeal’s Ruling

It upheld the Med-Arbiter’s finding that petitioner union consisted of both rank-and-file and supervisory
employees.

ISSUE:
WON the alleged mixture of rank-and-file and supervisory employees of petitioner union’s membership is a
ground for the cancellation of petitioner union’s legal personality.

RULING:
No. The CA found that petitioner union has for its membership both rank-and-file and supervisory employees.
However, petitioner union sought to represent the bargaining unit consisting of rank-and- file employees.
Under Article 245 of the Labor Code, supervisory employees are not eligible for membership in a labor
organization of rank-and-file employees. Thus, the appellate court ruled that petitioner union cannot be
considered a legitimate labor organization pursuant to Toyota Motor Philippines v. Toyota Motor Philippines
Corporation Labor Union (hereinafter Toyota).

Preliminarily, we note that petitioner union questions the factual findings of the Med-Arbiter, as upheld by the
appellate court, that 12 of its members, consisting of batchman, mill operator and leadman, are supervisory
employees. However, petitioner union failed to present any rebuttal evidence in the proceedings below after
respondent company submitted in evidence the job descriptions of the aforesaid employees. The job
descriptions indicate that the aforesaid employees exercise recommendatory managerial actions which are
not merely routinary but require the use of independent judgment, hence, falling within the definition of
supervisory employees under Article 212(m) of the Labor Code. For this reason, we are constrained to agree
with the Med-Arbiter, as upheld by the appellate court, that petitioner union consisted of both rank-and- file
and supervisory employees.

Nonetheless, the inclusion of the aforesaid supervisory employees in petitioner union does not divest it of its
status as a legitimate labor organization. The Court held that while there is a prohibition against the mingling
of supervisory and rank-and-file employees in one labor organization, the Labor Code does not provide for the
effects thereof. Thus, the Court held that after a labor organization has been registered, it may exercise all the
rights and privileges of a legitimate labor organization. Any mingling between supervisory and rank-and-file
employees in its membership cannot affect its legitimacy for that is not among the grounds for cancellation of
its registration, unless such mingling was brought about by misrepresentation, false statement or fraud under
Article 239 of the Labor Code

79. YOKOHAMA FIRE PHILS. v. YOKOHAMA EMPLOYEES UNION

FACTS:
On October 7, 1999, respondent Yokohama Employees Union (Union) filed a petition for certification election
among the rank-and-file employees of Yokohama. Upon appeal from the Med- Arbiters order dismissing the
petition, the Secretary of the Department of Labor and Employment (DOLE) ordered an election with (1)
Yokohama Employees Union and (2) No Union as choices.[3] The election held on November 23, 2001 yielded
the following result:

YOKOHAMA EMPLOYEES UNION – 131 NO UNION – 117

SPOILED – 2
----- 250

VOTES CHALLENGED BY [YOKOHAMA] – 78 VOTES CHALLENGED BY [UNION] – 73

------
TOTAL CHALLENGED VOTES – 151 TOTAL VOTES CAST - 401
Yokohama challenged 78 votes cast by dismissed employees. On the other hand, the Union challenged
68 votes cast by newly regularized rank-and-file employees and another five (5) votes by alleged supervisor-
trainees. Yokohama formalized its protest and raised as an issue the eligibility to vote of the 78 dismissed
employees,[5] while the Union submitted only a handwritten manifestation during the election.

Petitioner argues that the Court of Appeals erred in ruling that the votes of the dismissed employees should
be appreciated. Petitioner posits that employees who have quit or have been dismissed for just cause prior to
the date of the certification election are excluded from participating in the certification election. Petitioner
had questioned the eligibility to vote of the 78 dismissed employees.

Respondent counters that Section 2, Rule XII[16] of the rules implementing Book V of the Labor Code allows a
dismissed employee to vote in the certification election if the case contesting the dismissal is still pending.
Section 2, Rule XII, the rule in force during the November 23, 2001 certification election clearly, unequivocally
and unambiguously allows dismissed employees to vote during the certification election if the case they filed
contesting their dismissal is still pending at the time of the election.

ISSUE:
WHETHER OR NOT THE COURT OF APPEALS SERIOUSLY ERRED IN ALLOWING THE APPRECIATION OF VOTES OF
ALL OF ITS EMPLOYEES WHO WERE PREVIOUSLY DISMISSED FOR SERIOUS MISCONDUCT AND ABANDONMENT
OF WORK WHICH ARE CAUSES UNRELATED TO THE CERTIFICATION ELECTION.

Ruling:
NO. Was it proper to appreciate the votes of the dismissed employees
The new rule has explicitly stated that without a final judgment declaring the legality of dismissal, dismissed
employees are eligible or qualified voters. Thus,

RULE IX CONDUCT OF CERTIFICATION ELECTION

Section 5. Qualification of voters; inclusion-exclusion. .
. . An employee who has been dismissed from work but has contested the legality of the dismissal in a forum
of appropriate jurisdiction at the time of the issuance of the order for the conduct of a certification election
shall be considered a qualified voter, unless his/her dismissal was declared valid in a final judgment at the time
of the conduct of the certification election.
xxxx
Thus, we find no reversible error on the part of the DOLE Acting Secretary and the Court of Appeals in ordering
the appreciation of the votes of the dismissed employees.

Finally, we need not resolve the other issues for being moot. The 68 votes of the newly regularized rank-and-
file employees, even if counted in favor of No Union, will not materially alter the result. There would still
be208 votes in favor of respondent and 189 votes in favorofNoUnion. We also note that the certification
election is already a fait accompli, and clearly petitioners rank-and-file employees had chosen respondent as
their bargaining representative

80. TAKATA PHILS. v. BLR

DOCTRINE: It does not appear in Article 234 (b) of the Labor Code that the attendees in the organizational
meeting must comprise 20% of the employees in the bargaining unit. It is only under Article 234 (c) that
requires 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. Clearly, the 20% minimum requirement pertains to the employees’
membership in the union and not to the list of workers who participated in the organizational meeting.
FACTS:
Petitioner filed with the DOLE a Petition for Cancellation of the Certificate of Union Registration of Respondent
Samahang Lakas Manggagawa ng Takata (SALAMAT) on the ground that the latter is guilty of
misrepresentation, false statement and fraud with respect to the number of those who participated in the
organizational meeting, the adoption and ratification of its Constitution and By-Laws, and in the election of its
officers. Petitioner contended that in the May 1, 2009 organizational meeting of respondent, only 68
attendees signed the attendance sheet, and which number comprised only 17% of the total number of the 396
regular rank- and-file employees which respondent sought to represent, and hence, respondent failed to
comply with the 20% minimum membership requirement. Petitioner insisted that the document "Pangalan ng
mga Kasapi ng Unyon" bore no signatures of the alleged 119 union members; and that employees were not
given sufficient information on the documents they signed; that the document "Sama-Samang Pahayag ng
Pagsapi" was not submitted at the time of the filing of respondent's application for union registration.
2) Respondent denied the charge and claimed that the 119 union members were more than the 20%
requirement for union registration. The document "Sama-Samang Pahayag ng Pagsapi sa Unyon" which it
presented in its petition for certification election supported their claim of 119 members.
3) DOLE Regional Director granted the petition for cancellation of respondent's certificate of registration;
finding that the 68 employees who attended the organizational meeting was obviously less than 20% of the
total number of 396 regular rank-and-file employees which respondent sought to represent, hence, short of
the union registration requirement.
4) BLR: reversed DOLE RD, finding that petitioner failed to prove that respondent deliberately and
maliciously misrepresented the number of rank-and-file employees; that the list of employees who
participated in the organizational meeting was a separate and distinct requirement from the list of the names
of members comprising at least 20% of the employees in the bargaining unit; and that there was no
requirement for signatures opposite the names of the union members.
5) CA affirmed the decision of the BLR.

ISSUES: WON respondent obtained the minimum required number of employees for purposes of organization
and registration.

RULING: YES. 119 (of 396) employees as union members is even beyond the 20% minimum membership
requirement.

Art. 234, Labor Code: 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."

And after the issuance of the certificate of registration, the labor organization's registration could be assailed
directly through cancellation of registration proceedings in accordance with Articles 238 and 239 of the Labor
Code.
It does not appear in Article 234 (b) of the Labor Code that the attendees in the organizational meeting must
comprise 20% of the employees in the bargaining unit. In fact, even the Implementing Rules and Regulations
of the Labor Code does not so provide. It is only under Article 234 (c) that requires 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. Clearly, the 20% minimum requirement pertains to the employees’ membership in the union and
not to the list of workers who participated in the organizational meeting. Indeed, Article 234 (b) and (c)
provide for separate requirements, which must be submitted for the union's registration, and which
respondent did submit.

Here, the total number of employees in the bargaining unit was 396, and 20% of which was about 79.
Respondent submitted a document entitled "Pangalan ng Mga Kasapi ng Unyon" showing the names of 119
employees as union members, thus respondent sufficiently complied even beyond the 20% minimum
membership requirement. Respondent also submitted the attendance sheet of the organizational meeting
which contained the names and signatures of the 68 union members who attended the meeting. Considering
that there are 119 union members which are more than 20% of all the employees of the bargaining unit, and
since the law does not provide for the required number of members to attend the organizational meeting, the
68 attendees which comprised at least the majority of the 119 union members would already constitute a
quorum for the meeting to proceed and to validly ratify the Constitution and By-laws of the union. There is,
therefore, no basis for petitioner to contend that grounds exist for the cancellation of respondent's union
registration.

ELIGIBILITY FOR MEMBERSHIP; SPECIAL GROUPS OF EMPLOYEES

Labor Code
Article 255. [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.
Article 219(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.

Article 256. [245-A] Effect of Inclusion as Members of Employees Outside the Bargaining Unit. The inclusion
as union members of employees outside the bargaining unit 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.

DO No. 40-F-03, series if 2008

[separate file ]

Omnibus Rules, (as amended by DO 40)

Rule I,Section I
(hh) “Lockout” refers to the temporary refusal of an employer to furnish work as a result of a labor or
industrial dispute.
(nn) “Preventive Mediation Cases” refer to labor disputes which are the subject of a formal or informal
request for conciliation and mediation assistance sought by either or both parties or upon the initiative of the
Board.
(xx) “Strike” refers to any temporary stoppage of work by the concerted action of employees as a result of a
labor or industrial dispute.

Cases:
81. CATHAY PACIFIC STEEL CORP. v. CA
FACTS:
Enrique Tamandong III was a Personnel Superintendent in Cathay Pacific. His position has fixed daily working
hours or 8am to 12nn an 1pm to 5pm. Among his functions was issuing memos on company rules and
regulations, imposing disciplinary sanctions such as warnings (with irregular attendance and unauthorized
leave of absences) and suspensions, and executing the same which was “noted by” the company Vice
President.
ISSUE:
Is Enrique Tamandong III a supervisory employee eligible to join a union of supervisory employees?

HELD:
Yes. Tamondong does not possess the power to hire, transfer, terminate, or discipline erring employees of the
company. At the most, the record merely showed that he informed and warned rank-and-file employees with
respect to their violations of Cathay Pacific's rules and regulations. Also, the functions performed by
Tamandong such as issuance of warning to employees with irregular attendance and unauthorized leave of
absences and requiring employees to explain regarding charges of abandonment of work, are normally
performed by a mere supervisor, and not by a manager.

Likewise the imposition upon Tamandong’s required fixed daily working hours is very uncharacteristic of a
managerial employee. A managerial rank is that he is not subjected to the rigid observance of regular office
hours or maximum hours of work.

Case cited - Engineering Equipment, Inc. v. NLRC (1984)

“Among the characteristics of the managerial rank are:
(1) he is not subject to the rigid observance of regular office hours;
(2) his work requires the consistent exercise of discretion and judgment in its performance;
(3) the output produced or the result accomplished cannot be standardized in relation to a given period of
time;
(4) he manages a customarily recognized department or subdivision of the establishment, customarily and
regularly directing the work of other employees therein;
(5) he either has the authority to hire or discharge other employees or his suggestions and recommendations
as to hiring and discharging, advancement and promotion or other change of status of other employees are
given particular weight; and
(6) as a rule, he is not paid hourly wages nor subjected to maximum hours of work.”

82. SAN MIGUEL CORP. SUPERVISORS AND EXEMPT UNION v. LAGUESMA

FACTS:
Petitioner Union filed before the DOLE a Petition for District Certification or Certification Election among the
supervisors and exempt employees of the SMC Magnolia Poultry Products Plants of Cabuyao, San Fernando
and Otis. The Med-Arbiter issued an Order to conduct certification among the supervisors and exempt
employees of the SMC Magnolia Poultry Plants of Cabuyao, San Fernando and Otis as one bargaining unit.

Respondent SMC filed a Notice of Appeal with Memorandum of Appeal, pointing out, among others, the Med-
Arbiter’s error in grouping together all three
(3) separate plants into one bargaining unit, and in including supervisory levels 3 and above whose positions
are confidential in nature since they have access to information which is regarded by the employer to be
confidential from the business standpoint. Laguesma granted respondent company’s appeal and ordered the
remand of the case to the Med-Arbiter of origin for determination of the true classification of each of the
employees sought to be included in the appropriate bargaining unit.

Laguesma granted respondent company’s appeal and ordered the remand of the case to the Med-Arbiter of
origin for determination of the true classification of each employees sought to be included in the appropriate
bargaining unit. Upon petitioner’s motion, Laguesma granted the reconsideration and directed the conduct of
separate certification elections among the supervisors ranked as supervisory levels 1 to 4 and the exempt
employees in each of the three plants.

ISSUES:
1. Are supervisory employees and exempt employees of the company considered confidential employees,
hence ineligible to join a union?
2. If they are not confidential employees, do the employees of the three plants constitute an appropriate
bargaining unit?

Rulings:
1. NO. It is the contention of SMC that supervisory employees 3 and 4 and the exempt employees come
within the meaning of the term confidential employees primarily because they answered in the
affirmative when asked “Do you handle confidential data or documents?” in Position Questionnaires
submitted by the Union. In the same questionnaire, however, it was also stated that the confidential
information handled by questioned employees relate to product formulation, product standards and
product specification which by no means relate to labor relations. Granting arguendo that an employee
has access to confidential labor relations information but such is merely incidental to his duties and
 knowledge thereof is not necessary in the performance of such duties, said access does not render the
employee a confidential employee. If access to confidential labor relations information is to be a factor
in the determination of an employee’s confidential status, such information must relate to the
employers labor relations policies.
2. YES. An appropriate bargaining unit may be 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 to be best suited to serve the reciprocal
rights and duties of the parties under the collective bargaining provisions of the law.

It is readily seen that the employees in the instant case have community or mutuality of interest, 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.

83. STANDARD CHARTERED BANK EMPLOYEES UNION v. STANDARD CHARTERED BANK

Facts:
The 1998-2000 Collective Bargaining Agreement between the Standard Chartered Bank employees Union and
the Standard Chartered Bank expired so the parties tried to renew it but then a deadlock ensued. Under the
old CBA, the following are excluded as appropriate bargaining unit:
A. All covenanted and assistant officers (now called National Officers)
B. One confidential secretary of each of the:
1. Chief Executive, Philippine Branches
2. Deputy Chief Executive/Head, Corporate Banking Group
3. Head, Finance
4. Head, Human Resources
5. Manager, Cebu
6. Manager, Iloilo
7. Covenanted Officers provided said positions shall be filled by new recruits.
C. The Chief Cashiers and Assistant Cashiers in Manila, Cebu and Iloilo, and in any other branch that the BANK
may establish in the country.
D. Personnel of the Telex Department
E. All Security Guards
F. Probationary employees, without prejudice to Article 277 (c) of the Labor Code, as amended by R.A. 6715,
casuals or emergency employees; and
G. One (1) HR Staff
But then in the renewal sought by SCBEU-NUBE, they only wanted the exclusion to apply only to the following
employees from the appropriate bargaining unit, all managers who are vested with the right to hire and fire
employees, confidential employees, those with access to labor relations materials, Chief Cashiers, Assistant
Cashiers, personnel of the Telex Department and one Human Resources (HR) staff.

SCBEU-NUBE also averred that employees assigned in an acting capacity for at least a week should be given
salary raise.

A notice of strike was given to the Department of Labor due to this deadlock. Then DOLE Secretary Patricia
Sto. Tomas issued an order dismissing the Union’s plea.
ISSUE:
Whether or not the confidential employees sought to be removed from the exclusion as appropriate
bargaining unit by SCBEU-NUBE holds ground.
HELD:
No. Whether or not the employees sought to be excluded from the appropriate bargaining unit are
confidential employees is a question of fact, which is not a proper issue in a petition for review under Rule 45
of the Rules of Court. SCBEU-NUBE insists that the foregoing employees are not confidential employees;
however, it failed to buttress its claim. Aside from its generalized arguments, and despite the Secretary’s
finding that there was no evidence to support it, SCBEU-NUBE still failed to substantiate its claim. SCBEU-NUBE
did not even bother to state the nature of the duties and functions of these employees, depriving the Court of
any basis on which it may be concluded that they are indeed confidential employees.

With regards to the salary increase of employees in acting capacities, the Supreme Court agreed with the
Court of Appeals that a restrictive provision would curtail management’s prerogative, and at the same time,
recognized that employees should not be made to work in an acting capacity for long periods of time without
adequate compensation. The usual rule that “employees in acting capacities for at least a month should be
given salary raise” is upheld.

84. COASTAL SUBIC BAY TERMINAL v. DOLE

FACTS:
Private respondents Coastal Subic Bay Terminal, Inc. Rank-and-File Union (CSBTI-RFU) and Coastal Subic Bay
Terminal, Inc. Supervisory Union (CSBTI-SU) filed separate petitions for certification election before Med-
Arbiter Eladio de Jesus of the Regional Office No. III. The rank-and-file union insists that it is a legitimate labor
organization having been issued a charter certificate by the Associated Labor Union (ALU), and the supervisory
union by the Associated Professional, Supervisory, Office and Technical Employees Union (APSOTEU). Private
respondents also alleged that the establishment in which they sought to operate was unorganized.

The Med-Arbiter dismissed the petitions, holding that the ALU and APSOTEU are one and the same federation
having a common set of officers. Thus, the supervisory and the rank-and-file unions were in effect affiliated
with only one federation. Secretary of Labor and Employment reversed it. CA affirmed the decision of the
Secretary.
ISSUE:
Are ALU, a rank-and-file union and APSOTEU, a supervisory union one and the same because of the
commonalities between them? Are they commingled?
HELD
Yes. First, as earlier discoursed, once a labor union attains the status of a legitimate labor organization, it
continues as such until its certificate of registration is cancelled or revoked in an independent action for
cancellation.23 In addition, the legal personality of a labor organization cannot be collaterally attacked.24
Thus, when the personality of the labor organization is questioned in the same manner the veil of corporate
fiction is pierced, the action partakes the nature of a collateral attack. Hence, in the absence of any
independent action for cancellation of registration against either APSOTEU or ALU, and unless and until their
registrations are cancelled, each continues to possess a separate legal personality. The CSBTI-RFU and CSBTI-
SU are therefore affiliated with distinct and separate federations, despite the commonalities of APSOTEU and
ALU.

In the instant case, the national federations that exist as separate entities to which the rank-and-file and
supervisory unions are separately affiliated with, do have a common set of officers. In addition, APSOTEU, the
supervisory federation, actively participates in the CSBTI-SU while ALU, the rank-and-file federation, actively
participates in the CSBTI-RFU, giving occasion to possible conflicts of interest among the common officers of
the federation of rank-and-file and the federation of supervisory unions. For as long as they are affiliated with
the APSOTEU and ALU, the supervisory and rank-and-file unions both do not meet the criteria to attain the
status of legitimate labor organizations, and thus could not separately petition for certification elections.
85. TUNAY NA PAGKAKAISA NG MANGGAGAWA SA ASIA BREWERY v. ASIA BREWERY
FACTS:
Respondent Asia Brewery Inc (ABI) is engaged in the manufacture, sale and distribution of beer, shandy,
bottled water and glass products, it entered into a cba, effective for five years with Lakas ng mga
Manggagagawa sa Asia-Independent (BLMA), the exclusive bargaining representative of the former’s rank and
file employees. Under the cba, twelve jobs were excluded from the bargaining agreement. Subsequently, a
dispute arose when ABI’s management stopped deducting union dues from eighty one employees, believing
that their membership in BLMA violated the CBA. Respondent insisted that they fall under the “Confidential
and Executive Secrtaries” expressly excluded by the CBA from the rank and file bargaining unit. BLMA claimed
that ABI’s actions restrained the employees’ rights to self organization and brought the matter to the
grievance machinery. As the parties failed to settle the controversy, BLMA lodged a complaint before the
NCMB. The parties eventually agreed to submit the case for arbitration to resolve the issue with respect to the
right of self organization. VA ruled in favor of BLMA. Accordingly, the subject employees were declared eligible
for inclusion within the bargaining unit represented by BLMA. On appeal to the CA, it reversed the VA, ruling
that eighty one employees are excluded from and not eligible for inclusion in the bargaining unit as defined in
section two, article one of the cba; the eighty one employees cannot be validly members of respondent
and/or if already members, that their membership is violative of the cba and that they should disaffiliate from
respondent; and petitioner has not committed any act that restrained or tended to restrain its employees in
the exercise of their right to self organization. A certification election was held on August 10, 2002 wherein
petitioner won. As the incumbent bargaining representative of ABI’s rank and file employees claiming interest
in the outcome of the case, petitioner filed with the CA an omnibus motion for reconsideration of the decision
and intervention, with attached petition signed by the union officers. Both motions were denied by CA.
ISSUE
Whether or not workers were confidential employees

Ruling:
No. Secretaries or clerks, numbering about forty, are rank and file employees and 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. Confidential employees
are thus excluded from the rank-and-file bargaining unit. The rationale for their separate category and
disqualification to join any labor organization is similar to the inhibition for managerial employees because if
allowed to be affiliated with a Union, the latter might not be assured of their loyalty in view of evident conflict
of interests and the Union can also become company-denominated with the presence of managerial
employees in the Union membership. Having access to confidential information, confidential employees may
also become the source of undue advantage. Said employees may act as a spy or spies of either party to a
collective bargaining agreement. In the present case, the CBA expressly excluded Confidential and Executive
Secretaries from the rank- and-file bargaining unit, for which reason ABI seeks their disaffiliation from
petitioner. As can be gleaned from the above listing, it is rather curious that there would be several
secretaries/clerks for just one (1) department/division performing tasks which are mostly routine and clerical.
Respondent insisted they fall under the Confidential and Executive Secretaries expressly excluded by the CBA
from the rank-and-file bargaining unit. However, perusal of the job descriptions of these secretaries/clerks
reveals that their assigned duties and responsibilities involve routine activities of recording and monitoring,
and other paper works for their respective departments while secretarial tasks such as receiving
telephonecalls and filing of office correspondence appear to have been commonly imposed as additional
duties. Respondent failed to indicate who among these numerous secretaries/clerks have access to
confidential data relating to management policies that could give rise to potential conflict of interest with their
Union membership. Clearly, the rationale under our previous rulings for the exclusion of executive secretaries
or division secretaries would have little or no significance considering the lack of or very limited access to
confidential information of these secretaries/clerks. It is not even farfetched that the job category may exist
only on paper since they are all daily-paid workers. Quite understandably, petitioner had earlier expressed the
view that the positions were just being reclassified as these employees actually discharged routine functions.

86. SAN MIGUEL FOODS v. SMC SUPERVISORS AND EXEMPT UNION

FACTS:
On the date of an ordered certification election, petitioner San Miguel Foods, Inc. filed an objection thereto
questioning the eligibility to vote by some of its employees on the grounds that some employees do not
belong to the bargaining unit which respondent seeks to represent. Specifically, it argued, among others, that
certain employees (Note: which includes, among others, Payroll Master, Human Resource Assistant, and
Personnel Assistant) should not be allowed to vote as they are confidential employees. The then Acting DOLE
Undersecretary, in a resolution affirmed the order of the Med-Arbiter stating that respondent is certified to be
the exclusive bargaining agent of the supervisors and exempt employees of petitioner's Magnolia Poultry
Products Plants, with modification that some of the challenged employees be excluded from the bargaining
unit which respondent seeks to represent. The Court of Appeals (CA) affirmed with modification the
Resolution of the DOLE Undersecretary, stating that those holding the positions of Human Resource Assistant
and Personnel Assistant are excluded from the bargaining unit.

ISSUES:
1. Whether the CA erred in not excluding the position of Payroll Master in the definition of a confidential
employee
2. Whether the CA erred in ruling that the positions of Human Resource Assistant and Personnel Assistant
belong to the category of confidential employees

RULING:
1. YES. Confidential employees are defined as those who (1) assist or act in a confidential capacity, in regard;
(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. 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."
A confidential employee is one entrusted with confidence on delicate, or with the custody, handling or care
and protection of the employer’s property. Confidential employees, such as accounting personnel,
should be excluded from the bargaining unit, as their access to confidential information may become the
source of undue advantage. However, such fact does not apply to the position of Payroll Master and the whole
gamut of employees who, as perceived by petitioner, has access to salary and compensation data. The CA
correctly held that the position of Payroll Master does not involve dealing with confidential labor relations
information in the course of the performance of his functions. Since the nature of his work does not pertain to
company rules and regulations and confidential labor relations, it follows that he cannot be excluded from the
subject bargaining unit.
2. YES. Corollarily, 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. Confidential employees are thus excluded from the rank-
and-file bargaining unit. The rationale for their separate category and disqualification to join any labor
 organization is similar to the inhibition for managerial employees, because if allowed to be affiliated
with a union, the latter might not be assured of their loyalty in view of evident conflict of interests and
the union can also become company-denominated with the presence of managerial employees in the
union membership. Having access to confidential information, confidential employees may also
become the source of undue advantage. Said employees may act as a spy or spies of either party to a
collective bargaining agreement.

In this regard, the CA correctly ruled that the positions of Human Resource Assistant and Personnel Assistant
belong to the category of confidential employees and, hence, are excluded from the bargaining unit,
considering their respective positions and job descriptions. As Human Resource Assistant, the scopeof one’s
work necessarily involves labor relations, recruitment and selection of employees, access to employees'
personal files and compensation package, and human resource management. As regards a Personnel
Assistant, one's work includes the recording of minutes for management during collective bargaining
negotiations, assistance to management during grievance meetings and administrative investigations, and
securing legal advice for labor issues from the petitioner’s team of lawyers, and implementation of company
programs. Therefore, in the discharge of their functions, both gain access to vital labor relations information
which outrightly disqualifies them from union membership.

87. HERITAGE HOTEL v. SECRETARY

Facts:
Respondent National Union of Workers in Hotel Restaurant and Allied Industries-Heritage Hotel Manila
Supervisors Chapter (NUWHRAIN-HHMSC) filed a petition for certification election, seeking to represent all the
supervisory employees of Heritage Hotel Manila. The petitioner filed its opposition, but the opposition was
deemed denied when Med-Arbiter Napoleon V. Fernando issued his order for the conduct of the certification
election. The petitioner appealed the order of Med-Arbiter Fernando, but the appeal was also denied. A pre-
election conference was then scheduled. However, the pre-election conference was suspended until further
notice because of the repeated non-appearance of NUWHRAIN-HHMSC. Later, NUWHRAIN-HHMSC moved for
the conduct of the pre-election conference. The petitioner primarily filed its comment on the list of employees
submitted by NUWHRAIN-HHMSC, and simultaneously sought the exclusion of some from the list of
employees for occupying either confidential or managerial positions. The petitioner filed a motion to dismiss
raising the prolonged lack of interest of NUWHRAIN-HHMSC to pursue its petition for certification election.
The petitioner filed a petition for the cancellation of NUWHRAIN-HHMSC’s registration as a labor union for
failing to submit its annual financial reports and an updated list of members as required by Article 238 and
Article 239 of the Labor Code. It filed another motion to seek either the dismissal or the suspension of the
proceedings on the basis of its pending petition for the cancellation of union registration. However, the DOLE
issued a notice scheduling the certification elections. Dissatisfied, the petitioner commenced in the CA a
special civil action for certiorari, alleging that the DOLE gravely abused its discretion in not suspending the
certification election proceedings. The CA dismissed the petition for certiorari for non-exhaustion of
administrative remedies. The certification election proceeded as scheduled, and NUWHRAINHHMSC obtained
the majority vote of the bargaining unit. The petitioner filed a protest (with motion to defer the certification of
the election results and the winner), insisting on the illegitimacy of NUWHRAIN-HHMSC.
Issue:
Should the petition for the cancellation of union registration based on mixed membership of supervisors and
managers in a labor union, and the non-submission of reportorial requirements to the DOLE justify the
suspension of the proceedings for the certification elections or even the denial of the petition for the
certification election?
Ruling:
No. Under the long established rule, too, the filing of the petition for the cancellation of NUWHRAIN-HHMSC’s
registration should not bar the conduct of the certification election. In that respect, only a final order for the
cancellation of the registration would have prevented NUWHRAINHHMSC from continuing to enjoy all the
rights conferred on it as a legitimate labor union, including the right to the petition for the certification
election. This rule is now enshrined in Article 238-A of the Labor Code, as amended by Republic Act No. 9481.

Labor authorities should, indeed, act with circumspection in treating petitions for cancellation of union
registration, lest they be accused of interfering with union activities. In resolving the petition, consideration
must be taken of the fundamental rights guaranteed by Article XIII, Section 3 of the Constitution, i.e., the
rights of all workers to self-organization, collective bargaining and negotiations, and peaceful concerted
activities. Labor authorities should bear in mind that registration confers upon a union the status of legitimacy
and the concomitant right and privileges granted by law to a legitimate labor organization, particularly the
right to participate in or ask for certification election in a bargaining unit. Thus, 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.
R.A. No. 9481 also inserted in the Labor Code Article 242-A, which provides for reportorial requirements that
failure to comply with the requirements shall not be a ground for cancellation of union registration but shall
subject the erring officers or members to suspension, expulsion from membership, or any appropriate penalty.

Presently, then, the mixed membership does not result in the illegitimacy of the registered labor union unless
the same was done through misrepresentation, false statement or fraud according to Article 239 of the Labor
Code.

88. DE LA SALLE UNIVERSITY MEDICAL CENTER v. LAGUESMA

FACTS:
The Federation of Free Workers (FFW), a national federation of labor unions, issued a certificate to
DLSUMCCM Supervisory Union Chapter recognizing it as a local chapter. FFW filed on behalf of the union a
petition for certification election among the supervisory employees of DLSUMCCM. This petition was opposed
by DLSUMCCM on the grounds that several employees who signed the petition for certification election were
managerial employees and that the Union was composed of both supervisory and rank and file employees in
the company and that the act of supervisory employees in affiliating with FFW to who the rank and file
employees are also affiliated is violative of Article 245 of the Labor Code. This opposition was repeatedly
denied. Thus, this petition for certiorari.
ISSUES:
1. Whether unions formed independently by supervisory and rank and file employees of a company may
validly affiliate with the same national federation.
2. Are the conditions laid down in Atlas met?
RULINGS:
1. YES. Supervisory employees have the right to self-organization as do other classes of employees save only
managerial ones. The Constitution states that “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.”

As held in United Pepsi-Cola Supervisory Union v. Laguesma, the framers of the Constitution intended, by this
provision, to restore the right of supervisory employees to self-organization which had been withdrawn from
them during the period of martial law.
Conformably with the constitutional mandate, Art. 245 of the Labor Code now provides for the right of
supervisory employees to self-organization, subject to the limitation that they cannot join an organization of
rank-and-file employees: Supervisory employees shall not be eligible for membership in a labor organization of
the rank-and-file employees but may join, assist or form separate labor organizations of their own.
The reason for the segregation of supervisory and rank-and-file employees of a company with respect to the
exercise of the right to self-organization is the difference in their interests. Supervisory employees are more
closely identified with the employer than with the rank-and-file employees. If supervisory and rank-and-file
employees in a company are allowed to form a single union, the conflicting interests of these groups impair
their relationship and adversely affect discipline, collective bargaining, and strikes.
These consequences can obtain not only in cases where supervisory and rank-and-file employees in the same
company belong to a single union but also where unions formed independently by supervisory and rank-and–
file employees of a company are allowed to affiliate with the same national federation.
Atlas Lithographic Services Inc. v. Laguesma: To avoid a situation where supervisors would merge with the
rank-and-file or where the supervisors’ labor organization would represent conflicting interests, then a local
supervisors’ union should not be allowed to affiliate with a national federation of unions of rank-and-file
employees where that federation actively participates in union activities in the company.
It was explained in that case however that such a situation would obtain only where two conditions concur:
(1) The rank-and-file employees are directly under the authority of supervisory employees.
(2) The national federation is actively involved in union activities in the company.
The presence of these 2 conditions distinguished Atlas from the case of Adamson & Adamson, Inc. vs. CIR
where it was held that:
The affiliation of two local unions in a company with the same national federation is not by itself a negation of
their independence since in relation to the employer, the local unions are considered as the principals, while
the federation is deemed to be merely their agent. This conclusion is in accord with the policy that any
limitation on the exercise by employees of the right to self-organization guaranteed in the Constitution must
be construed strictly. Workers should be allowed the practice of this freedom to the extent recognized in the
fundamental law.
2. NO. Although DLSUMCCMSUC and another union composed of rank-and-file employees of DLSUMCCM
are indeed affiliated with the same national federation, the FFW, DLSUMCCM has not presented any
evidence showing that the rank-and-file employees composing the other union are directly under the
authority of the supervisory employees.
The fact that the two groups of workers are employed by the same company and the fact that they are
affiliated with a common national federation are not sufficient to justify the conclusion that their organizations
are actually just one. Their immediate professional relationship must be established.
The fact that the petition for certification election in this case was filed by the FFW on behalf of the local
union, while showing active involvement by the FFW in union activities at the company, is by itself insufficient
to justify a finding of violation of Art. 245 since there is no proof that the supervisors who compose the local
union have direct authority over the rank-and-file employees composing the other local union which is also
affiliated with the FFW.

89. PEPSI-COLA PRODUCTS v. SECRETARY OF LABOR

Doctrine:
If 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, then a local supervisors' union should
not be allowed to affiliate with the national federation of union of rank-and-file employees where that
federation actively participates in union activity in the company.
Facts:
Pepsi-Cola Employees Organization-UOEF (Union) filed a petition for certification election with the Med-
Arbiter seeking to be the exclusive bargaining agent of supervisors of Pepsi. Med-Arbiter granted the Petition,
with the explicit statement that it was an affiliate of Union de Obreros Estivadores de Filipinas (federation)
together with 2 rank and file unions: Pepsi-Cola Labor Unity (PCLU) and Pepsi-Cola Employees Union of the
Philippines (PEUP). Pepsi opposed the petition on the grounds that (a) the members of the Union were
managers and (b) a supervisors' union can not affiliate with a federation whose members include the rank and
file union of the same company. Pepsi contended that a final determination contention should first be
disposed of before granting the Petition for the Conduct of Certification Election. To allow the conduct of the
certification election to proceed would make any decision arrived at by the Bureau of Labor Relations useless
inasmuch as the same would necessarily be rendered moot and academic.
Issue:
1. Whether or not the supervisors union can be affiliated with a Federation with two (2) rank and file
unions.
2. Whether or not the Petition to cancel/revoke registration is a prejudicial question to the petition for
certification election.
3. Whether or not confidential employees can join the labor union of the rank and file.
Held:
1. The issue in G.R. No. 96663, whether or not the supervisors union can be affiliated with a Federation with
two (2) rank and file unions directly under the supervision of the former, has thus become moot and academic
in view of the Union's withdrawal from the federation.
2. NO. The following ruling in the case of Association of the Court of Appeals Employees (ACAE) vs. Hon. Pura
Ferrer-Calleja “It is a well-settled rule that a certification proceedings is not a litigation in the sense that the
term is ordinarily understood, but an investigation of a non-adversarial and fact finding character." At any
rate, the Court applies the established rule correctly followed by the public respondent that an order to hold a
certification election is proper despite the pendency of the petition for cancellation of the registration
certificate of the respondent union. The rationale for this is that at the time the respondent union filed its
petition, it still had the legal personality to perform such act absent an order directing the cancellation.
3. NO. As regards the issue of whether or not confidential employees can join the labor union of the rank and
file “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”
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.

UNION SECURITY CLAUSE

Labor Code
Article 259 (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 Code204 shall not apply to the non-members of the recognized collective bargaining agent;

Cases:
90. BPI v. BPI EMPLOYEES UNION
FACTS:
The Bangko Sentral ng Pilipinas and Securities and Exchange Commission approved the Articles of Merger
executed by and between BPI, herein petitioner, and FEBTC. Pursuant to the Article and Plan of Merger, all the
assets and liabilities of FEBTC were transferred to and absorbed by BPI as the surviving corporation. FEBTC
employees, including those in its different branches across the country, were hired by petitioner as its own
employees, with their status and tenure recognized and salaries and benefits maintained.

Respondent BPI Employees Union is the exclusive bargaining agent of BPI's rank and file employees. The
former FEBTC rank-and-file employees did not belong to any labor union at the time of the merger.
Respondent Union then sent notices to the former FEBTC employees who refused to join the Union, as well as
those who retracted their membership, and called them to a hearing regarding the matter. When these
former FEBTC employees refused to attend the hearing, the president of the Union requested BPI to
implement the Union Shop Clause of the CBA and to terminate their employment pursuant thereto. Petitioner
refused to do so.

ISSUE:
WON the employees absorbed by the BPI due to the merger are considered as "New Employees", thus
covered by the Union Shop Clause in the CBA
RULING:
Yes. The Union Shop Clause in the CBA simply states that "new employees" who during the effectivity of the
CBA "may be regularly employed" by the Bank must join the union within thirty (30) days from their
regularization. There is nothing in the said clause that limits its application to only new employees who
possess nonregular status, meaning probationary status, at the start of their employment. Petitioner likewise
failed to point to any provision in the CBA expressly excluding from the Union Shop Clause new employees
who are "absorbed" as regular employees from the beginning of their employment. What is indubitable from
the Union Shop Clause is that upon the effectivity of the CBA, petitioner's new regular employees (regardless
of the manner by which they became employees of BPI) are required to join the Union as a condition of their
continued employment.
There are no substantial differences between a newly hired non-regular employee who was regularized weeks
or months after his hiring and a new employee who was absorbed from another bank as a regular employee
pursuant to a merger, for purposes of applying the Union Shop Clause.
The effect or consequence of BPI's so-called "absorption" of former FEBTC employees should be limited to
what they actually agreed to, i.e., recognition of the FEBTC employees' years of service, salary rate and other
benefits with their previous employer. The effect should not be stretched so far as to exempt former FEBTC
employees from the existing CBA terms, company policies and rules which apply to employees similarly
situated. If the Union Shop Clause is valid as to other new regular BPI employees, there is no reason why the
same clause would be a violation of the "absorbed" employees' freedom of association.

91. GENERAL MILLING CORP. v. CASIO

Facts:
The labor union Ilaw at Buklod ng Mangagawa (IBM)-Local 31 Chapter (Local 31) was the sole and exclusive
bargaining agent of the rank and file employees of GMC. On November 30, 1991, IBM-Local 31, through its
officers and board members entered into a CBA with GMC. The effectivity of the said CBA was retroactive to
August 1, 1991.
The CBA contained the following union security provisions:
Section 3. MAINTENANCE OF MEMBERSHIP All employees/workers employed by the Company with the
exception of those who are specifically excluded by law and by the terms of this Agreement must be members
in good standing of the Union within 30 days upon the signing of this agreement and shall maintain such
membership in good standing thereof as a condition of their employment or continued employment.
Section 6. The Company, upon written request of the Union, shall terminate the services of any
employee/worker who fails to fulfill the conditions set forth in Sections 3 and 4 thereof, subject however, to
the provisions of the Labor Laws and their IRR. The Union shall absolve the Company from any and all
liabilities, pecuniary or otherwise, and responsibilities to any employee or worker who is dismissed or
terminated in pursuant thereof.
Casio, et al. were regular employees of GMC. Casio was elected IBM-Local 31 President for a three-year term
in June 1991, while his co-respondents were union shop stewards.
In a letter dated February 1992, Rodolfo Gabiana, the IBM Regional Director, furnished Casio, et al. with copies
of the Affidavits of 2 GMC employees, charging Casio, et al. with "acts inimical to the interest of the union."
Through the same letter, Gabiana gave Casio, et al. three days from receipt thereof within which to file their
answers or counter-affidavits. However, Casio, et al. refused to acknowledge receipt of Gabiana’s letter.
Subsequently, Pino, et al., as officers and members of the IBM-Local 31, issued a Resolution expelling Casio, et
al. from the union.
Gabiana then wrote a letter addressed to Eduardo Cabahug (Cabahug), GMC Vice-President for Engineering
and Plant Administration, informing the company of the expulsion of Casio, et al. from the union pursuant to
the Resolution. Gabiana likewise requested that Casio, et al. "be immediately dismissed from their work for
the interest of industrial peace in the plant.
Gabiana followed-up with another letter inquiring from Cabahug why Casio, et al. were still employed with
GMC despite the request of IBM-Local 31 that Casio, et al. be immediately dismissed from service pursuant to
the closed shop provision in the existing CBA. Gabiana reiterated the demand of IBM-Local 31 that GMC
dismiss Casio, et al., with the warning that failure of GMC to do so would constitute gross violation of the
existing CBA and constrain the union to file a case for ULP against GMC.
Pressured by the threatened filing of a suit for ULP, GMC acceded to Gabiana’s request to terminate the
employment of Casio, et al.
Casio, et al., in the name of IBM-Local 31, filed a Notice of Strike with the NCMB. Casio, et al. alleged as bases
for the strike the illegal dismissal of union officers and members, discrimination, coercion, and union busting.
The NCMB-held conciliation proceedings, but no settlement was reached among the parties.
Casio, et al. next sought recourse from the NLRC by filing a Complaint against GMC and Pino, et al. for unfair
labor practice, particularly, the termination of legitimate union officers, illegal suspension, illegal dismissal,
and moral and exemplary damages.
Voluntary Arbitrator Canonoy-Morada rendered a Voluntary Arbitration Award dismissing the Complaint for
lack of merit, but granting separation pay and attorneys fees to Casio, et al. Dissatisfied with the Voluntary
Arbitration Award, Casio, et al. went to the CA. CA set aside the Voluntary Arbitration Award. CA ruled that
while the dismissal of Casio, et al., was made by GMC pursuant to a valid closed shop provision under the CBA,
the company, however, failed to observe the elementary rules of due process in implementing the said
dismissal.
Issue:
W/N Casio, et al. were illegally dismissed.
Ruling:
YES. Whether Casio, et al. were illegally dismissed without any valid reason is a question of fact better left to
quasi-judicial agencies to determine. In this case, the Voluntary Arbitrator was convinced that Casio, et al.
were legally dismissed; while the Court of Appeals believed the opposite. The Court is therefore constrained to
take a second look at the evidence on record considering that the factual findings of the VA and the CA are
contradictory.
There are two aspects which characterize the concept of due process under the Labor Code: one is substantive
whether the termination of employment was based on the provision of the LC or in accordance with the
prevailing jurisprudence; the other is procedural the manner in which the dismissal was effected.
After a thorough review of the records, the Court agrees with the CS. The dismissal of Casio, et al. was indeed
illegal, having been done without just cause and the observance of procedural due process.
In Alabang Country Club, Inc. v. NLRC, the Court laid down the grounds for which an employee may be validly
terminated, thus:
Under the Labor Code, an employee may be validly terminated on the following grounds: (1) just causes under
Art. 282; (2) authorized causes under Art. 283; (3) termination due to disease under Art. 284, and (4)
termination by the employee or resignation under Art. 285.
Another cause for termination is dismissal from employment due to the enforcement of the union security
clause in the CBA. x x x.
"Union security" is a generic term, which is applied to and comprehends "closed shop," "union shop,"
"maintenance of membership," or any other form of agreement which imposes upon employees the
obligation to acquire or retain union membership as a condition affecting employment. There is union shop
when all new regular employees are required to join the union within a certain period as a condition for their
continued employment. There is maintenance of membership shop when employees, who are union members
as of the effective date of the agreement, or who thereafter become members, must maintain union
membership as a condition for continued employment until they are promoted or transferred out of the
bargaining unit or the agreement is terminated. A closed shop, on the other hand, may be defined as an
enterprise in which, by agreement between the employer and his employees or their representatives, no
person may be employed in any or certain agreed departments of the enterprise unless he or she is, becomes,
and, for the duration of the agreement, remains a member in good standing of a union entirely comprised of
or of which the employees in interest are a part.
Union security clauses are recognized and explicitly allowed under Article 248(e) of the Labor Code, which
provides that:
Art. 248. Unfair Labor Practices of Employers.
(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.
It is State policy to promote unionism to enable workers to negotiate with management on an even playing
field and with more persuasiveness than if they were to individually and separately bargain with the employer.
For this reason, the law has allowed stipulations for "union shop" and "closed shop" as means of encouraging
workers to join and support the union of their choice in the protection of their rights and interest vis-à-vis the
employer.
Moreover, a stipulation in the CBA authorizing the dismissal of employees are of equal import as the statutory
provisions on dismissal under the Labor Code, since "a CBA is the law between the company and the union
and compliance therewith is mandated by the express policy to give protection to labor."
In terminating the employment of an employee by enforcing the union security clause, the employer needs
only to determine and prove that: (1) the union security clause is applicable; (2) the union is requesting for the
enforcement of the union security provision in the CBA; and (3) there is sufficient evidence to support the
decision of the union to expel the employee from the union. These requisites constitute just cause for
terminating an employee based on the union security provision of the CBA.
There is no question that in the present case, the CBA between GMC and IBM-Local 31 included a
maintenance of membership and closed shop clause as can be gleaned from Sections 3 and 6 of Article II. IBM-
Local 31, by written request, can ask GMC to terminate the employment of the employee/worker who failed
to maintain its good standing as a union member.
It is similarly undisputed that IBM-Local 31, through Gabiana, the IBM Regional Director for Visayas and
Mindanao, twice requested GMC to terminate the employment of Casio, et al. as a necessary consequence of
their expulsion from the union.
It is the third requisite that there is sufficient evidence to support the decision of IBM-Local 31 to expel Casio,
et al. which appears to be lacking in this case.
It is apparent from the letter that GMC terminated the employment of Casio, et al. relying upon the Resolution
of Pino, et al. expelling Casio, et al. from IBM-Local 31; Gabiana’s Letters demanding that GMC terminate the
employment of Casio, et al. on the basis of the closed shop clause in the CBA; and the threat of being sued by
IBM-Local 31 for unfair labor practice. The letter made no mention at all of the evidence supporting the
decision of IBM-Local 31 to expel Casio, et al. from the union. GMC never alleged nor attempted to prove that
the company actually looked into the evidence of IBM-Local 31 for expelling Casio, et al. and made a
determination on the sufficiency thereof. Without such a determination, GMC cannot claim that it had
terminated the employment of Casio, et al. for just cause.
The failure of GMC to make a determination of the sufficiency of evidence supporting the decision of IBM-
Local 31 to expel Casio, et al. is a direct consequence of the non-observance by GMC of procedural due
process in the dismissal of employees.
The records of this case are absolutely bereft of any supporting evidence to substantiate the bare allegation of
GMC that Casio, et al. were accorded due process by IBM-Local 31. There is nothing on record that would
indicate that IBM-Local 31 actually notified Casio, et al. of the charges against them or that they were given
the chance to explain their side. All that was stated in the IBM-Local 31 Resolution, expelling Casio, et al. from
the union, was that "a copy of the said letter complaint was dropped or left in front of E. Casio." It was not
established that said letter-complaint charging Casio, et al. with acts inimical to the interest of the union was
properly served upon Casio, that Casio willfully refused to accept the said letter-notice, or that Casio had the
authority to receive the same letter-notice on behalf of the other employees similarly accused. It’s worthy to
note that Casio, et al. were expelled only five days after the issuance of the letter-complaint against them. The
Court cannot find proof on record when the three-day period, within which Casio, et al. was supposed to file
their answer or counter-affidavits, started to run and had expired. The Court is likewise unconvinced that the
said three-day period was sufficient for Casio, et al. to prepare their defenses and evidence to refute the
serious charges against them.
Contrary to the position of GMC, the acts of Pino, et al. as officers and board members of IBM-Local 31, in
expelling Casio, et al. from the union, do not enjoy the presumption of regularity in the performance of official
duties, because the presumption applies only to public officers from the highest to the lowest in the service of
the Government, departments, bureaus, offices, and/or its political subdivisions.
More importantly, in Liberty Cotton Mills Workers Union v. Liberty Cotton Mills, Inc., and in Malayang
Samahan ng mga Manggagawa sa M. Greenfield v. Ramos the Court issued the following reminder to
employers:
“The employer is bound to exercise caution in terminating the services of his employees especially so when it
is made upon the request of a labor union pursuant to the Collective Bargaining Agreement. Dismissals must
not be arbitrary and capricious. Due process must be observed in dismissing an employee because it affects
not only his position but also his means of livelihood.”
The twin requirements of notice and hearing constitute the essential elements of procedural due process. The
law requires the employer to furnish the employee sought to be dismissed with two written notices before
termination of employment can be legally effected.
Irrefragably, GMC cannot dispense with the requirements of notice and hearing before dismissing Casio, et al.
even when said dismissal is pursuant to the closed shop provision in the CBA. The rights of an employee to be
informed of the charges against him and to reasonable opportunity to present his side in a controversy with
either the company or his own union are not wiped away by a union security clause or a union shop clause in a
collective bargaining agreement. An employee is entitled to be protected not only from a company which
disregards his rights but also from his own union the leadership of which could yield to the temptation of swift
and arbitrary expulsion from membership and hence dismissal from his job.
In the case at bar, Casio, et al. did not receive any other communication from GMC, except the written notice
of termination. GMC, by its own admission, did not conduct a separate and independent investigation to
determine the sufficiency of the evidence supporting the expulsion of Casio, et al. by IBP-Local 31. It straight
away acceded to the demand of IBP-Local 31 to dismiss Casio, et al.
In sum, the Court finds that GMC illegally dismissed Casio, et al. because not only did GMC fail to make a
determination of the sufficiency of evidence to support the decision of IBM-Local 31 to expel Casio, et al., but
also to accord the expelled union members procedural due process, i.e., notice and hearing, prior to the
termination of their employment

92. PICOP RESOURCES v. TAÑECA

Facts:
Respondents filed a Complaint for unfair labor practice, illegal dismissal and money claims against petitioner
PICOP Resources, Incorporated (PRI) and its officers. They were regular rank-and-file employees of PRI and
bona fide members of Nagkahiusang Mamumuo sa PRI Southern Philippines Federation of Labor (NAMAPRI-
SPFL), which is the collective bargaining agent for the rank-and-file employees of petitioner PRI. PRI has a
collective bargaining agreement (CBA) with NAMAPRI-SPFL. It contained a union security clause, to wit: All
employees within the appropriate bargaining unit who are members of the UNION at the time of the signing
of this AGREEMENT shall, as a condition of continued employment by the COMPANY, maintain their
membership in the UNION in good standing.
PRI sent a letter to the management of PRI demanding the termination of employees who allegedly
campaigned for, supported and signed the Petition for Certification Election of the Federation of Free
Workers Union (FFW) during the effectivity of the CBA. NAMAPRI-SPFL contended that it is an act of disloyalty
and a valid basis for termination for a cause in accordance with its Constitution and By-Laws and CBA terms.
After investigation, they were subsequently sent termination notices on the ground of "acts of disloyalty".
Respondents then accused PRI of Unfair Labor Practice. They alleged that none of them ever withdrew their
membership from NAMAPRI-SPFL or submitted to PRI any union dues and check-off disauthorizations against
NAMAPRI-SPFL. They claimed that they continue to remain on record as bona fide members of NAMAPRI-
SPFL. They also claimed that there was lack of procedural due process. The Labor Arbiter declared the
respondents’ dismissal to be illegal.
ISSUE:
Whether or not respondents are validly terminated pursuant to union security clause provided in the CBA.
HELD:
No. In terminating the employment of an employee by enforcing the union security clause, the employer
needs to determine and prove that: (1) the union security clause is applicable; (2) the union is requesting for
the enforcement of the union security provision in the CBA; and (3) there is sufficient evidence to support the
decision of the union to expel the employee from the union. These requisites constitute just cause for
terminating an employee based on the union security provision of the CBA.
As to the first requisite, there is no question that the CBA between PRI and respondents included a union
security clause, specifically, a maintenance of membership as stipulated in Sections 6 of Article II, Union
Security and Check-Off. Following the same provision, PRI, upon written request from the Union, can indeed
terminate the employment of the employee who failed to maintain its good standing as a union member.
Secondly, it is likewise undisputed that NAMAPRI-SPFL, in two (2) occasions demanded from PRI to terminate
the employment of respondents due to their acts of disloyalty to the Union. However, as to the third requisite,
we find that there is no sufficient evidence to support the decision of PRI to terminate the employment of the
respondents.
The mere signing of the authorization in support of the Petition for Certification Election of FFW before the
"freedom period," is not sufficient ground to terminate the employment of respondents. Nothing in the
records would show that respondents failed to maintain their membership in good standing in the Union.
Respondents did not resign or withdraw their membership from the Union to which they belong. Respondents
continued to pay their union dues and never joined the FFW. Hence, the third requisite is lacking.

93. VICTORIANI v. ELIZALDE ROPE WORKERS UNION

Facts:
Benjamin Victoriano is a member of the religious sect known as the "Iglesia ni Cristo" and had been in the
employ of the Elizalde Rope Factory, Inc. He was also a member of the EPWU (Elizalde Rope Workers’ Union).
The Company has a collective bargaining agreement containing a closed shop provision. Victoriano tendered
his resignation from EPWU claiming that as per RA 3350 he is an exemption to the closed shop agreement by
virtue of his being a member of the INC because apparently in the INC, one is forbidden from being a member
of any labor union. The company moved to terminate Victoriano due to his non-membership from the EPWU.
EPWU and ERF reiterated that he is not exempt from the close shop agreement because RA 3350, which
provides that closed shop agreements shall not cover members of any religious sects which prohibit affiliation
of their members in any such labor organization, is unconstitutional and that said law violates the EPWU’s and
ERF’s legal/contractual rights. Appellant Union, furthermore, asserted that a "closed shop provision" in a
collective bargaining agreement cannot be considered violative of religious freedom.
ISSUE:
Whether or not RA 3350 is unconstitutional.
HELD:
No. Republic Act No. 3350 is constitutional. The Act classifies employees and workers, as to the effect and
coverage of union shop security agreements, into those who by reason of their religious beliefs and
convictions cannot sign up with a labor union, and those whose religion does not prohibit membership in labor
unions. The classification introduced by said Act is also germane to its purpose. The purpose of the law is
precisely to avoid those who cannot, because of their religious belief, join labor unions, from being deprived of
their right to work and from being dismissed from their work because of union shop security agreements. The
act also applies equally to all members of said religious sects; this is evident from its provision. The fact that
the law grants a privilege to members of said religious sects cannot by itself render the Act unconstitutional.

The right to religion prevails over contractual or legal rights. As such, an INC member may refuse to join a
labor union and despite the fact that there is a closed shop agreement in the factory where he was employed,
his employment could not be validly terminated for his non-membership in the majority therein. Further, the
right to join a union includes the right not to join a union. The law is not unconstitutional. It recognizes both
the rights of unions and employers to enforce terms of contracts and at the same time it recognizes the
workers’ right to join or not to join union. RA 3550 recognizes as well the primacy of a constitutional right over
a contractual right.

94. KAPATIRAN SA MEAT AND CANNING DIVISION v. FERRER-CALLEJA

FACTS:
Petitioner was an exclusive bargaining representative. Prior to its expiration as such, it staged a strike to
pressure the employer to extend its contract. Now, within the freedom period, another union belonging to the
same unit filed for certification election. The same was challenged by herein petitioner on the ground that the
union petitioning for certification election is mostly composed of Iglesia ni Cristo members who once refused
to affiliate with it. It then contends that, by virtue of their prior religious objection, the said union(mostly
composed of INC members) are not eligible to file for certification election.

ISSUE
Whether or not INC members, who deliberately and previously refused to affiliate with a union, may organize
by themselves.
RULING:
Yes. This Court's decision inVictoriano 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."

CONDITIONS OF MEMBERSHIP AND RIGHTS IF MEMBERS

Labor Code
Article 250. [241] Rights and Conditions of Membership in a Labor Organization.
The following are the rights and conditions of membership in a labor organization:
(a) No arbitrary or excessive initiation fees shall be required of the members of a legitimate labor organization
nor shall arbitrary, excessive or oppressive fine and forfeiture be imposed;
(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;
(c) The members shall directly elect their officers in the local union, as well as their national officers in the
national union or federation to which they or their local union is affiliated, by secret ballot at intervals of five
(5) years. No qualification requirement 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;
(d) The members shall determine by secret ballot, after due deliberation, any question of major policy
affecting the entire membership of the organization, unless the nature of the organization or force majeure
renders such secret ballot impractical, in which case, the board of directors of the organization may make the
decision in behalf of the general membership;
(e) No labor organization shall knowingly admit as members or continue in membership any individual who
belongs to a subversive organization or who is engaged directly or indirectly in any subversive activity;
(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;
(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;
(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.
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;
(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;
(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,
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
(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.
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 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.

Article 289. [274] Visitorial Power. The Secretary of Labor and Employment or his duly authorized
representative is hereby empowered to inquire into 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) days freedom period nor within the thirty (30) days immediately preceding the
date of election of union officials.

Article 228(b). Appearances and Fees.

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 agreed upon by the parties. Any contract,
agreement or arrangement of any sort to the contrary shall be null and void.
Article 259(e). It shall be unlawful for an employer to commit any of the following unfair labor practices:
xxx 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 Code204 shall not apply to the non-members of the recognized collective bargaining agent xxx

Omnibus Rules, Book V (as amended by DO 40)

Rule XI, XII, XIII, XVIII, XX

RULE XI
INTER/INTRA-UNION DISPUTES AND OTHER RELATED LABOR RELATIONS DISPUTES
Section 1. Coverage. - Inter/intra-union disputes shall include:
a. Cancellation of registration of a labor organization filed by its members or by another labor organization;
b. Conduct of election of union and workers' association officers/nullification of election of union and workers'
association officers;
c. Audit/accounts examination of union or workers' association funds;
d. Deregistration of collective bargaining agreements;
e. Validity/invalidity of union affiliation or disaffiliation;
f. Validity/invalidity of acceptance/non-acceptance for union membership;
g. Validity/invalidity of impeachment/expulsion of union and workers’ association
officers and members;
h. Validity/invalidity of the SEBA certification;
i. Opposition to application for union and CBA registration;
j. Violations of or disagreements over any provision in a union or workers'
association constitution and by-laws;
k. Disagreements over chartering or registration of labor organizations and
collective bargaining agreements;
l. Violations of the rights and conditions of union or workers' association
membership;
m. Violations of the rights of legitimate labor organizations, except interpretation of
collective bargaining agreements; and
n. Such other disputes or conflicts involving the rights to self-organization, union
membership and collective bargaining –
1. Between and among legitimate labor organizations; or
2. Between and among members of a union or workers' association.
B. Other labor relations disputes, not otherwise covered by Article 224 (renumbered) of the Labor Code, shall
include:
(a) any conflict between:
1) a labor union and the employer, or
2) a labor union and a group that is not a labor organization; or
3) a labor union and an individual who is not a member of such union;
(b) cancellation of registration of unions and workers associations filed by individual/s other than its members,
or group that is not a labor organization; and
(c) a petition for interpleader involving labor relations.
Section 2. Effects of the filing: Pendency of inter/intra-union and other related labor relations disputes. – The
rights, relationships and obligations of the parties litigants against each other and other parties-in-interest
prior to the institution of the petition shall continue to remain during the pendency of the petition and until
the date of finality of the decision rendered therein. Thereafter, the rights, relationships and obligations of the
parties litigants against each other and other parties-in-interest shall be governed by the decision so ordered.
The filing or pendency of any inter/intra-union dispute and other related labor relations dispute is not a
prejudicial question to any petition for certification election and shall not be a ground for the dismissal of a
petition for certification election or suspension of proceedings for certification election.
Section 3. Who may file. – Any legitimate labor organization or member(s) thereof specially concerned may file
a complaint or petition involving disputes or issues enumerated in Section 1 hereof. Any party-in-interest may
file a complaint or petition involving disputes or issues enumerated in Section 1.B hereof
Where the issue involves the entire membership of the labor organization, the complaint or petition shall be
supported by at least thirty percent (30%) of its members.
Section 4. Where to file. – Complaints or petitions involving labor unions with independent registrations,
chartered locals, workers’ associations, its officers or members shall be filed with the Regional Office that
issued its certificate of registration or certificate of creation of chartered local. Complaints involving
federations, national unions, industry unions, its officers or member organizations shall be filed with the
Bureau.
Petitions for cancellation of registration of labor unions with independent registration, chartered locals and
workers association and petitions for deregistration of collective bargaining agreements shall be resolved by
the Regional Director. He/She may appoint a Hearing Officer from the Labor Relations Division.
Other inter/intra-union disputes and related labor relations disputes shall be heard and resolved by the
Mediator-Arbiter in the Regional Office.
Complaints or petitions involving federations, national or industry unions, trade union centers and their
chartered locals, affiliates or member organizations shall be filed either with the Regional Office or the Bureau.
The complaint or petition shall be heard and resolved by the Bureau.
When two or more petitions involving the same parties and the same causes of action are filed, the same shall
be automatically consolidated.
Section 5. Formal requirements of the complaint or petition. The complaint or petition shall be in writing,
verified under oath and shall, among others, contain the following:
(a) name, address and other personal circumstances of the complainant(s) or petitioner(s);
(b) name, address and other personal circumstances of the respondent(s) or person(s) charged;
(c) nature of the complaint or petition;
(d) facts and circumstances surrounding the complaint or petition;
(e) cause(s) of action or specific violation(s) committed;
(f) a statement that the administrative remedies provided for in the constitution and by-laws have been
exhausted or such remedies are not readily available to the complainant(s) or petitioner(s) through no fault of
his/her/their own, or compliance with such administrative remedies does not apply to complainant(s) or
petitioner(s);
(g) relief(s) prayed for;
(h) certificate of non-forum shopping; and
(i) other relevant matters.
Section 6. Raffle of the case. –Upon the filing of the complaint or petition, the Regional Director or any of
his/her authorized representative in the Regional Office and the Docket Section of the Bureau shall allow the
party filing the complaint or petition to determine the Mediator-Arbiter or Hearing Officer assigned to the case
by means of a raffle. Where there is only one Mediator-Arbiter or Hearing Officer in the Region, the raffle shall
be dispensed with and the complaint or petition shall be assigned to him/her.
Section 7. Notice of preliminary conference. – Immediately after the raffle of the case or receipt of the
complaint or petition, the same shall be transmitted to the Mediator-Arbiter or Hearing Officer, as the case
may be, who shall in the same instance prepare the notice for preliminary conference and cause the service
thereof upon the party filing the petition. The preliminary conference shall be scheduled within ten (10) days
from receipt of the complaint or petition.
Within three (3) days from receipt of the complaint or petition, the Mediator-Arbiter or Hearing Officer, as the
case may be, shall cause the service of summons upon the respondent(s) named therein, directing him/her to
file his/her answer/comment on the complaint or petition on or before the scheduled preliminary conference
and to appear before the Mediator-Arbiter or Hearing Officer on the scheduled preliminary conference.
Section 8. Conduct of preliminary conference. – The Mediator-Arbiter or Hearing Officer, as the case may be,
shall conduct a preliminary conference and hearing within ten (10) days from receipt of the complaint or
petition. He/She shall exert every effort to effect an amicable settlement of the dispute.
Where the parties agree to settle amicably, their agreements shall be specified in the minutes of the
conference and a decision based on compromise shall be issued by the Mediator-Arbiter or the Regional
Director, as the case may be, within five (5) days from the date of the mandatory conference.
Where no amicable settlement is reached, the Mediator-Arbiter or Hearing Officer, as the case may be, shall
proceed with the stipulation of facts, limitation or definition of the issues, clarificatory questioning and
submission of laws and jurisprudence relied upon in support of each other’s claims and defenses.
Section 9. Conduct of Hearing(s). – The Mediator-Arbiter or Hearing Officer, as the case may be, shall
determine whether to call further hearing(s) on the complaint or petition.
Where the Mediator-Arbiter or Hearing Officer, as the case may be, decides to conduct further hearing(s),
he/she shall require the parties to submit the affidavits of their witnesses and such documentary evidence
material to prove each other’s claims and defenses. The hearing(s) shall be limited to clarificatory questions by
the Mediator-Arbiter or Hearing Officer and must be completed within twenty-five (25) days from the date of
preliminary conference.
The complaint or petition shall be considered submitted for decision after the date of the last hearing or upon
expiration of twenty-five (25) days from date of preliminary conference, whichever comes first.
Section 10. Affirmation of testimonial evidence. – Any affidavit submitted by a party to prove his/her claims or
defenses shall be re-affirmed by the presentation of the affiant before the Mediator-Arbiter or Hearing Officer,
as the case may be. Any affidavit submitted without the re-affirmation of the affiant during a scheduled
hearing shall not be admitted in evidence, except when the party against whom the affidavit is being offered
admits all allegations therein and waives the examination of the affiant.
Section 11. Filing of pleadings. – The parties may file his/her pleadings, including their respective position
papers, within the twenty-five (25) day period prescribed for the conduct of hearing(s). No other pleading shall
be considered or entertained after the case is considered submitted for decision.
Section 12. Hearing and resolution of the complaint or petition in the Bureau. – The Bureau shall observe the
same process and have the same period within which to hear and resolve the complaints or petitions filed
before it.
Section 13. Decision. – The Bureau and the Mediator-Arbiter or Regional Director, as the case may be, shall
have twenty (20) days from the date of the last hearing within which to decide the complaint or petition. The
decision shall state the facts, findings, conclusion, and reliefs granted.
Section 14. Release of Decision. – The notice of decision shall be signed by the Records Officer in the Bureau
and by the Mediator-Arbiter or Hearing Officer in the Regional Office. Within twenty (20) days from date of
last hearing, the decision shall be released to the parties personally on a date and time agreed upon during the
last hearing.
Section 15. Appeal. – The decision of the Mediator-Arbiter and Regional Director may be appealed to the
Bureau by any of the parties within ten (10) days from receipt thereof, copy furnished the opposing party. The
decision of the Bureau Director in the exercise of his/her original jurisdiction may be appealed to the Office of
the Secretary by any party within the same period, copy furnished the opposing party.
The appeal shall be verified under oath and shall consist of a memorandum of appeal specifically stating the
grounds relied upon by the appellant, with supporting arguments and evidence.
Section 16. Where to file appeal. – The memorandum of appeal shall be filed in the Regional Office or Bureau
where the complaint or petition originated. Within twenty-four (24) hours from receipt of the memorandum
of appeal, the Bureau or Regional Director shall cause the transmittal thereof together with the entire records
of the case to the Office of the Secretary or the Bureau, as the case may be.
Section 17. Finality of Decision. – Where no appeal is filed within the ten-day period, the Bureau and Regional
Director or Mediator-Arbiter, as the case may be, shall enter the finality of the decision in the records of the
case and cause the immediate implementation thereof.
Section 18. Period to reply. – A reply to the appeal may be filed by any party to the complaint or petition
within ten (10) days from receipt of the memorandum of appeal. The reply shall be filed directly with the
Bureau or the Office of the Secretary, as the case may be.
Section 19. Decision of the Bureau/Office of the Secretary. – The Bureau Director or the Secretary, as the case
may be, shall have twenty (20) days from receipt of the entire records of the case within which to decide the
appeal. The filing of the memorandum of appeal from the decision of the Mediator-Arbiter or Regional
Director and Bureau Director stays the implementation of the assailed decision.
The Bureau or Office of the Secretary may call the parties to a clarificatory hearing in aid of its appellate
jurisdiction.
Section 20. Finality of Decision of Bureau/Office of the Secretary. – The decision of the Bureau or the Office of
the Secretary shall become final and executory after ten (10) days from receipt thereof by the parties, unless a
motion for its reconsideration is filed by any party therein within the same period. Only one (1) motion for
reconsideration of the decision of the Bureau or the Office of the Secretary in the exercise of their appellate
jurisdiction shall be allowed.
Section 21. Execution of decision. – The decision of the Mediator-Arbiter and Regional Director shall
automatically be stayed pending appeal with the Bureau. The decision of the Bureau in the exercise of its
appellate jurisdiction shall be immediately executory upon issuance of entry of final judgment.
The decision of the Bureau in the exercise of its original jurisdiction shall automatically be stayed pending
appeal with the Office of the Secretary. The decision of the Office of the Secretary shall be immediately
executory upon issuance of entry of final judgment.
Section 22. Transmittal of records to the Regional Office/Bureau. – Within forty- eight (48) hours from the
notice of receipt of decision by the parties and finality of the decision, the entire records of the case shall be
remanded to the Bureau or Regional Office of origin for implementation. The implementation of the decision
shall not be stayed unless restrained by the appropriate court.

RULE XII
ELECTION OF OFFICERS OF LABOR UNIONS AND WORKERS ASSOCIATIONS
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 Mediator-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.

RULE XIII
ADMINISTRATION OF TRADE UNION FUNDS AND ACTIONS ARISING THEREFROM
Section 1. Right of union to collect dues and agency fees. – The incumbent bargaining agent shall continue to
be entitled to check-off and collect dues and agency fees despite the pendency of a representation case, other
inter/intra-union disputes or related labor relations disputes.
Section 2. Visitorial power under Article 289(renumbered) – The Regional or Bureau Director may inquire into
the financial activities of any legitimate labor organization and examine their books of accounts and other
records to determine compliance with the law and the organization’s constitution and by-laws. Such
examination shall be made upon the filing of a request or complaint for the conduct of an accounts
examination by any member of the labor organization, supported by the written consent of at least twenty
(20%) percent of its total membership.
Section 3. Where to file. – A request for examination of books of accounts of independent labor unions,
chartered locals and workers associations pursuant to Article 289 shall be filed with the Regional Office that
issued its certificate of registration or certificate of creation of chartered local.
A request for examination of books of accounts of federations or national unions and trade union centers
pursuant to Article 289 (renumbered) shall be filed with the Bureau. Such request or complaint, in the absence
of allegations pertaining to a violation of Article 250 (renumbered), shall not be treated as an intra-union
dispute and the appointment of an Audit Examiner by the Regional or Bureau Director shall not be appealable.
Section 4. Actions arising from Article 250 (renumbered). – Any complaint or petition with allegations of
mishandling, misappropriation or non-accounting of funds in violation of Article 250(renumbered) shall be
treated as an intra-union dispute. It shall be heard and resolved by the Mediator-Arbiter pursuant to the
provisions of Rule XI.
Section 5. Prescription. – The complaint or petition for audit or examination of funds and book of accounts
shall prescribe within three (3) years from the date of submission of the annual financial report to the
Department or from the date the same should have been submitted as required by law, whichever comes
earlier.
Section 6. Decision. – A decision granting the conduct of audit shall include the appointment of the Audit
Examiner and a directive upon him/her to submit his/her report and recommendations within ten (10) days
from termination of audit. The decision granting the conduct of audit is interlocutory and shall not be
appealable. The decision denying or dismissing the complaint or petition for audit may be appealed within ten
(10) days from receipt thereof pursuant to the provisions prescribed in Rule XI.
Section 7. Pre-audit conference. – Within twenty-four (24) hours from receipt of the decision granting the
conduct of audit, the Regional Director shall summon the parties to a pre- audit conference conducted by the
Audit Examiner to determine and obtain the following:
(a) sources of funds covered by the audit;
(b) the banks and financial institutions where the labor organization maintains its account;
(c) union books of accounts and financial statements;
(d) disbursement vouchers with supporting receipts, invoices and other documents;
(e) income and revenue receipts;
(f) cashbooks;
(g) minutes of general membership meeting and board meetings;
(h) other relevant matters and documents.
The first pre-audit conference shall be scheduled within ten (10) days from receipt by the Audit Examiner of
the decision granting the conduct of an audit.
Section 8. Issuance of subpoena. – The Regional Director may compel any party to appear or bring the
required financial documents in a conference or hearing through the issuance of a subpoena ad testificandum
or subpoena duces tecum. He/She may also require the employer concerned to issue certifications of union
dues and other assessments remitted to the union during the period of audit.
Section 9. Conduct of audit examination. – Where book of accounts are submitted by the parties, the Audit
Examiner shall:
(a) examine the transactions reflected in the disbursement vouchers;
(b) determine the validity of the supporting documents attached to the vouchers consistent with the union’s
constitution and by-laws, relevant resolutions of the union
and the Labor Code;
(c) trace recording and posting in the disbursement book;
(d) record observations or findings of all financial transactions.
Where no book of accounts are maintained by the officers of the labor organization, the Audit Examiner shall:
(a) examine the transactions reflected in the disbursement vouchers;
(b) determine the validity of the supporting documents attached to the vouchers consistent with the labor
organization’s constitution and by-laws, relevant board
resolutions, and the Labor Code;
(c) prepare working papers or worksheet/s;
(d) record and post all financial transactions reflected in the cash vouchers in the
working papers or worksheet/s; and
(e) record observations or findings of all financial transactions.
The Audit Examiner shall conduct an inventory of all physical assets acquired by the labor organization, if any,
and on the basis of his/her findings prepare his/her audited financial report or statement reflecting the true
and correct financial accounts and balances of the labor organization with relevant annexes attached.
Section 10. Period of audit. – The Audit Examiner shall have sixty (60) days from the date of first pre-audit
conference within which to complete the conduct of audit, unless the volume of financial records, the period
covered by the audit and other circumstances warrant the extension thereof. In such a case, the Audit
Examiner shall notify the Mediator-Arbiter or the Bureau Director, as the case may be, of such fact at least ten
(10) days before the expiration of the sixty (60) day period.
Section 11. Audit Report. – The Audit Examiner shall make a report of his/her findings to the parties involved
and the same shall include the following:
(a) name of the labor organization;
(b) name of complainant(s) or petitioner(s) and respondent(s);
(c) name of officers of the labor organization during the period covered by the audit
report;
(d) scope of the audit;
(e) list of documents examined;
(f) audit methods and procedures adopted; and
(g) findings and recommendations.
Section 12. Completion of audit. – A copy of the audit report shall be forwarded by the Audit Examiner to the
Mediator-Arbiter or the Bureau Director, as the case may be, within ten (10) days from termination of the
audit, together with the entire records of the case and all documents relative to the conduct of the audit.
Section 13. Decision after audit. – The Mediator-Arbiter or the Bureau Director shall render a decision within
twenty (20) days from receipt of the audit report. All issues raised by the parties during the conduct of the
audit shall be resolved by the Mediator-Arbiter. The decision shall be released in the same manner prescribed
in Section 14, Rule XI.
When warranted, the Mediator-Arbiter or Bureau Director shall order the restitution of union funds by the
responsible officer(s) in the same decision.
Section 14. Appeal. – Appeal from the decision of the Mediator-Arbiter denying the conduct of audit and from
the results of the audit may be filed by any of the parties with the Bureau. Decisions rendered by the Bureau
after the conduct of audit in the exercise of its original jurisdiction may be appealed to the Office of the
Secretary. Both shall be resolved in accordance with the provisions of Section 15, Rule XI.
Section 15. Period of inquiry or examination. – No complaint for inquiry or examination of the financial and
book of accounts as well as other records of any legitimate labor organization shall be entertained during the
sixty (60) day freedom period or within thirty (30) days immediately preceding the date of election of union
officers. Any complaint or petition so filed shall be dismissed.

RULE XVIII
CENTRAL REGISTRY OF LABOR ORGANIZATIONS AND COLLECTIVE BARGAINING AGREEMENTS
Section 1. Forms for registration. – Consistent with the policy of the State to promote unionism, the Bureau
shall devise or prescribe such forms as are necessary to facilitate the process of registration of labor
organizations and collective bargaining agreements or of compliance with all documentary or reporting
requirements prescribed in these Rules.
Section 2. Transmittal of records; central registry. – The Labor Relations Division of the Regional Offices shall,
within forty-eight (48) hours from issuance of a certificate of creation of chartered locals or certificate of
registration of labor organizations and collective bargaining, transmit to the Bureau a copy of such certificates
accompanied by a copy of the documents supporting registration.
The Labor Relations Division of the Regional Office shall also transmit to the Bureau a copy of every final
decision canceling or revoking the legitimate status of a labor organization or collective bargaining agreement,
indicating therein the date when the decision became final.
In cases of chartering and affiliation or compliance with the reporting requirements under Rule V, the Regional
Office shall transmit within two (2) days from receipt thereof the original set of documents to the Bureau,
retaining one set of documents for its file.

RULE XX
LABOR EDUCATION AND RESEARCH
Section 1. Labor education of workers and employees. – The Department shall develop, promote and
implement appropriate labor education and research programs on the rights and responsibilities of workers
and employers.
It shall be the duty of every legitimate labor organization to implement a labor education program for its
members on their rights and obligations as unionists and as employees.
Section 2. Mandatory conduct of seminars. – Subject to the provisions of Article 250, it shall be mandatory for
every legitimate labor organization to conduct seminars and similar activities on existing labor laws, collective
agreements, company rules and regulations and other relevant matters. The union seminars and similar
activities may be conducted independently of or in cooperation with the Department and other labor
education institutions.
Section 3. Special fund for labor education and research. – Every legitimate labor organization shall, for the
above purpose, maintain a special fund for labor education and research. Existing strike funds may, in whole
or in part, be transformed into labor education and research funds. The labor organization may also
periodically assess and collect reasonable amounts from its members for such funds.

CANCELLATION OF REGISTRATION

Labor Code
Article 245. [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 246. [238-A] Effect of a Petition for Cancellation of Registration. A petition for cancellation of union
registration shall not suspend the proceedings for certification election nor shall it prevent the filing of a
petition for certification election.
In case of cancellation, nothing herein shall restrict the right of the union to seek just and equitable remedies
in the appropriate courts.
Article 247. [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.

Omnibus Rules, Book V (as amended by DO 40-3),Rule VI, XIV-XV

RULE VI
DETERMINATION OF REPRESENTATION STATUS
Section 1. Policy. – It is the policy of the State to promote free trade unionism through expeditious procedures
governing the choice of an exclusive bargaining agent. The determination of such exclusive bargaining agent is
a non-litigious proceeding and, as far as practicable, shall be free from technicalities of law and procedure,
provided only that in every case, the exclusive bargaining agent enjoys the majority support of all the
employees in the bargaining unit.
Section 2. Determination of representation status; modes. – The determination of an exclusive bargaining
agent shall be through request for sole and exclusive bargaining agent (SEBA) certification in cases where
there is only one legitimate labor organization operating within the bargaining unit, or through certification,
run-off or consent election as provided in these Rules.

RULE XIV
CANCELLATION OF REGISTRATION OF LABOR ORGANIZATIONS
Section 1. Cancellation of registration; Where to file. – Subject to the requirements of notice and due process,
the registration of any legitimate independent labor union, local/chapter and workers’ association may be
cancelled by the Regional Director upon the filing of a petition for cancellation of union registration, or
application by the organization itself for voluntary dissolution.
The petition for cancellation or application for voluntary dissolution shall be filed in the Regional Office which
issued its certificate of registration or creation.
In the case of federations, national or industry unions and trade union centers, the Bureau Director may cancel
the registration upon the filing of a petition for cancellation or application for voluntary dissolution in the
Bureau of Labor Relations.
Section 2. Who may file. – Any party-in-interest may commence a petition for cancellation of registration,
except in actions involving violations of Article 250 (renumbered), which can only be commenced by members
of the labor organization concerned.
Section 3. Grounds for cancellation. – Any of the following may constitute as ground/s for cancellation of
registration of labor organizations:
(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;
(b) misrepresentation, false statements or fraud in connection with the election of officers, minutes of the
election of officers, and the list of voters; or
(c) voluntary dissolution by the members.
Section 4. Voluntary Cancellation of Registration: How Made. - A legitimate labor organization may cancel its
registration provided at least two thirds (2/3) of its general membership votes to dissolve the organization in a
meeting duly called for that purpose and an application to cancel its registration is thereafter submitted by the
board of the organization to the Regional/Bureau Director, as the case may be. The application shall be
attested to by the president of the organization.
Section 5. Action on the petition/application. – The petition/application shall be acted upon by the
Regional/Bureau Director, as the case may be. In case of a petition for cancellation of registration, the formal
requirements, processes and periods of disposition stated in Rule XI shall be followed in the determination of
the merits of the petition.
Section 6. Prohibited grounds for cancellation of registration. - The inclusion as union members of employees
who are outside the bargaining unit shall not be a ground to cancel the union registration. The ineligible
employees are automatically deemed removed from the list of membership of the union.
The affiliation of the rank-and-file and supervisory unions operating within the same establishment to the
same federation or national union shall not be a ground to cancel the registration of either union.

RULE XV
REGISTRY OF LABOR ORGANIZATIONS AND COLLECTIVE BARGAINING AGREEMENTS
Section 1. National Registry. – The Bureau shall be the national registry of labor organizations and collective
bargaining agreements. As such it shall:
(a) maintain a national registry;
(b) within the month of March following the end of the calendar year, publish in the Department of Labor and
Employment website the lists of labor organizations and federations which have complied with the reportorial
requirements of Rule V and delinquent labor organizations;
(c) publish a list of officers of labor organizations with criminal conviction by final judgment; and
(d) verify the existence of a registered labor organization with no registered collective bargaining agreement
and which has not been complying with the reportorial requirements for at least five years. The verification
shall observe the following process:
1) The Regional Office shall make a report of the labor organization’s non- compliance and submit the same to
the Bureau for verification. 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 service of the first notice, it shall
send another notice for compliance, with warning that failure on its part to comply with the reportorial
requirements within the time specified shall cause its publication as a non-existing labor organization in the
DOLE website.
2) Where no response is received by the Bureau within thirty (30) days from service of the second notice, the
Bureau shall publish the notice of non-existence of the labor organization/s in the DOLE website.
3) 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 delist the labor organization from the
roster of legitimate labor organizations.

Cases:
95. SAMMA-LIKHA v. SAMMA CORP
Facts:
Samahan ng mga Manggagawa sa Samma Lakas sa Industriya ng Kapatirang Haligi ng Alyansa (SAMMA- LIKHA)
filed a petition for certification election on July 24, 2001. It claimed that: (1) it was a local chapter of the LIKHA
Federation, a legitimate labor organization registered with the DOLE; (2) it sought to represent all the rank-
and-file employees of respondent Samma Corporation; (3) there was no other legitimate labor organization
representing these rank-and-file employees; (4) respondent was not a party to any collective bargaining
agreement and (5) no certification or consent election had been conducted within the employer unit for the
last 12 months prior to the filing of the petition.

Samma Corp. moved for the dismissal of the petition arguing that (1) LIKHA Federation failed to establish its
legal personality; (2) petitioner failed to prove its existence as a local chapter; (3) it failed to attach the
certificate of non-forum shopping and (4) it had a prohibited mixture of supervisory and rank-and-file
employees.

Med-Arbiter’s Ruling
Med-Arbiter dismissed the petition on the following grounds: (1) lack of legal personality for failure to attach
the certificate of registration purporting to show its legal personality; (2) prohibited mixture of rank-and- file
and supervisory employees and (3) failure to submit a certificate of non-forum shopping.

Petitioner moved for MR. The Regional Director of DOLE forwarded the case to the Secretary of Labor. During
pendency of the petition, Samma Corp. filed a petition for cancellation of petitioners union registration in the
DOLE Regional Office IV.

Sec. of Labor’s Ruling

Reversed the order of the med-arbiter. SOL ruled that the legal personality of a union cannot be collaterally
attacked but may only be questioned in an independent petition for cancellation of registration. Thus, he
directed the holding of a certification election among the rank-and-file employees of respondent, subject to
the usual pre- election conference and inclusion-exclusion proceedings.

Meanwhile, Director of DOLE revoked the charter certificate of SAMMA-LIKHA as local chapter of LIKHA

Federation on the ground of prohibited mixture of supervisory and rank-and-file employees and non-
compliance with the attestation clause under paragraph 2 of Article 235 of the Labor Code.

CA’s Ruling
CA reversed SOL’s decision. CA held that Administrative Circular No. 04-94 which required the filing of a
certificate of non-forum shopping applied to petitions for certification election. It also ruled that the Secretary
of Labor erred in granting the appeal despite the lack of proof of service on respondent. Lastly, it found that
petitioner had no legal standing to file the petition for certification election because its members were a
mixture of supervisory and rank-and-file employees.
Issues:
1. Whether a certificate for non-forum shopping is required in a petition for certification election.
2. Whether SAMMA LIKHA had the legal personality to file the petition for certification election.
Rulings:
1. NO. REQUIREMENT OF CERTIFICATE OF NON- FORUM SHOPPING IS NOT REQUIRED IN A PETITION FOR
CERTIFICATION ELECTION.

The requirement for a certificate of non-forum shopping refers to complaints, counter-claims, cross- claims,
petitions or applications where contending parties litigate their respective positions regarding the claim for
relief of the complainant, claimant, petitioner or applicant. A certification proceeding, even though initiated by
a petition, is not a litigation but an investigation of a non-adversarial and fact-finding character.

Such proceedings are not predicated upon an allegation of misconduct requiring relief, but, rather, are merely
of an inquisitorial nature. The Board's functions are not judicial in nature, but are merely of an investigative
character. The object of the proceedings is not the decision of any alleged commission of wrongs nor asserted
deprivation of rights but is merely the 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.

Under the omnibus rules implementing the Labor Code as amended by D.O. No. 9, the PCE is supposed to be
filed in the Regional Office which has jurisdiction over the principal office of the employer or where the
bargaining unit is principally situated. The rules further provide that where two or more petitions involving the
same bargaining unit are filed in one Regional Office, the same shall be automatically consolidated. Hence, the
filing of multiple suits and the possibility of conflicting decisions will rarely happen in this proceeding and, if it
does, will be easy to discover.

2. NO. LEGAL PERSONALITY OF PETITIONER

The erroneous inclusion of one supervisory employee in the union of rank-and-file employees was not a
ground to impugn its legitimacy as a legitimate labor organization which had the right to file a petition for
certification election.
LIKHA was granted legal personality as a federation. With certificates of registration issued in their favor, they
are clothed with legal personality as legitimate labor organizations. Such legal personality cannot thereafter be
subject to collateral attack, but may be questioned only in an independent petition for cancellation of
certificate of registration. Unless petitioners union registration is cancelled in independent proceedings, it
shall continue to have all the rights of a legitimate labor organization, including the right to petition for
certification election.

Samma Corp. filed a petition for cancellation of the registration of petitioner on December 14, 2002. In a
resolution dated April 14, 2003, petitioners charter certificate was revoked by the DOLE. But on May 6, 2003,
petitioner moved for the reconsideration of this resolution. Neither of the parties alleged that this resolution
revoking petitioners charter certificate had attained finality. However, in this petition, petitioner prayed that
its charter certificate be reinstated in the roster of active legitimate labor [organizations]. The proceedings on
a petition for cancellation of registration are independent of those of a petition for certification election. This
case originated from the latter. If it is shown that petitioners legal personality had already been revoked or
cancelled with finality in accordance with the rules, then it is no longer a legitimate labor organization with the
right to petition for a certification election.

A FINAL NOTE
Respondent, as employer, had been the one opposing the holding of a certification election among its rank-
and-file employees. This should not be the case. We have already declared that, in certification elections, the
employer is a bystander; it has no right or material interest to assail the certification election.

96. MARIWASA v. SECRETARY OF DOLE

Facts:
On May 4, 2005, respondent Samahan Ng Mga Manggagawa Sa Mariwasa Siam Ceramics, Inc.
(SMMSCIndependent) was issued a Certificate of Registration as a legitimate labor organization by the
Department of Labor and Employment (DOLE), Region IV-A. On June 14, 2005, petitioner Mariwasa
Siam Ceramics, Inc. filed a Petition for Cancellation of Union Registration against respondent, claiming
that the latter violated Article 234 of the Labor Code for not complying with the 20% requirement,
and that it committed massive fraud and misrepresentation in violation of Article 239 of the same
code. On August 26, 2005, the Regional Director of DOLE IV-A issued an Order granting the petition,
revoking the registration of respondent, and delisting it from the roster of active labor unions.
Aggrieved, respondent appealed to the Bureau of Labor Relations (BLR). In a Decision dated June 14,
2006, the BLR granted respondent’s appeal. Petitioner filed a Motion for Reconsideration but the BLR
denied it in a Resolution dated February 2, 2007. Petitioner sought recourse with the Court of Appeals
(CA) through a Petition for Certiorari; but the CA denied the petition for lack of merit. Petitioner’s
motion for reconsideration of the CA Decision was likewise denied.
Issues:
1. Whether or not private respondent union complied with the 20% membership requirement
2. Whether or not the Court of Appeals seriously erred when it ruled that private respondent union
did not commit misrepresentation, fraud or false statement.
Ruling:
1. YES. Our ruling in La Suerte Cigar and Cigarette Factory v. Director of the Bureau of Labor
Relations11 is enlightening, viz.—
whether or not the withdrawal of 31 union members from NATU affected the petition for
certification election insofar as the 30% requirement is concerned, We reserve the Order of the
respondent Director of the Bureau of Labor Relations, it appearing undisputably that the 31 union
members had withdrawn their support to the petition before the filing of said petition. It would be
otherwise if the withdrawal was made after the filing of the petition for it would then be
presumed that the withdrawal was not free and voluntary. The presumption would arise that the
withdrawal was procured through duress, coercion or for valuable consideration. In other words,
the distinction must be that withdrawals made before the filing of the petition are presumed
voluntary unless there is convincing proof to the contrary, whereas withdrawals made after the
filing of the petition are deemed involuntary. The reason for such distinction is that if the
withdrawal or retraction is made before the filing of the petition, the names of employees
supporting the petition are supposed to be held secret to the opposite party. Logically, any such
withdrawal or retraction shows voluntariness in the absence of proof to the contrary. Moreover, it
becomes apparent that such employees had not given consent to the filing of the petition, hence
the subscription requirement has not been met.

When the withdrawal or retraction is made after the petition is filed, the employees who are
supporting the petition become known to the opposite party since their names are attached to the
petition at the time of filing. Therefore, it would not be unexpected that the opposite party would use
foul means for the subject employees to withdraw their support. In the instant case, the affidavits of
recantation were executed after the identities of the union members became public, i.e., after the
union filed a petition for certification election on May 23, 2005, since the names of the members
were attached to the petition. The purported withdrawal of support for the registration of the union
was made after the documents were submitted to the DOLE, Region IV-A. The logical conclusion,
therefore, following jurisprudence, is that the employees were not totally free from the employer’s
pressure, and so the voluntariness of the employees’ execution of the affidavits becomes suspect. It is
likewise notable that the first batch of 25 pro forma affidavits shows that the affidavits were
executed by the individual affiants on different dates from May 26, 2005 until June 3, 2005, but they
were all sworn before a notary public on June 8, 2005. Accordingly, we cannot give full credence to
these affidavits, which were executed under suspicious circumstances, and which contain allegations
unsupported by evidence. At best, these affidavits are selfserving. They possess no probative value.
Nevertheless, even assuming the veracity of the affidavits of recantation, the legitimacy of respondent
as a labor organization must be affirmed. While it is true that the withdrawal of support may be
considered as a resignation from the union, the fact remains that at the time of the union’s
application for registration, the affiants were members of respondent and they comprised more than
the required 20% membership for purposes of registration as a labor union. Article 234 of the Labor
Code merely requires a 20% minimum membership during the application for union registration. It
does not mandate that a union must maintain the 20% minimum membership requirement all
throughout its existence. Respondent asserts that it had a total of 173 union members at the time it
applied for registration. Two names were repeated in respondent’s list and had to be deducted, but
the total would still be 171 union members. Further, out of the four names alleged to be no longer
connected with petitioner, only two names should be deleted from the list since Diana Motilla and
T.W. Amutan resigned from petitioner only on May 10, 2005 and May 17, 2005, respectively, or after
respondent’s registration had already been granted. Thus, the total union membership at the time of
registration was 169. Since the total number of rank-andf ile employees at that time was 528, 169
employees would be equivalent to 32% of the total rank-and-file workers complement, still very much
above the minimum required by law.
2. NO. For the purpose of de-certifying a union such as respondent, it must be shown that there
was 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; or, in
connection with the election of officers, the minutes of the election of officers, the list of
voters, or failure to submit these documents together with the list of the newly elected-
appointed officers and their postal addresses to the BLR. The bare fact that two signatures
appeared twice on the list of those who participated in the organizational meeting would not,
 to our mind, provide a valid reason to cancel respondent’s certificate of registration. The
cancellation of a union’s registration doubtless has an impairing dimension on the right of labor
to selforganization. For fraud and misrepresentation to be grounds for cancellation of union
registration under the Labor Code, the nature of the fraud and misrepresentation must be
grave and compelling enough to vitiate the consent of a majority of union members. In this
case, we agree with the BLR and the CA that respondent could not have possibly committed
misrepresentation, fraud, or false statements. The alleged failure of respondent to indicate
with mathematical precision the total number of employees in the bargaining unit is of no
moment, especially as it was able to comply with the 20% minimum membership requirement.
Even if the total number of rankand-file employees of petitioner is 528, while respondent
declared that it should only be 455, it still cannot be denied that the latter would have more
than complied with the registration requirement.

97. HERITAGE HOTEL MANILA v. NUHRAIN-HAMSC

Facts:
On October 11, 1995, respondent filed with the Department of Labor and Employment-National Capital
Region (DOLE-NCR) a petition for certification election. The Med-Arbiter granted the petition on
February 14, 1996 and ordered the holding of a certification election. On appeal, the DOLE Secretary,
in a Resolution dated August 15, 1996, affirmed the Med-Arbiter's order and remanded the case to
the Med-Arbiter for the holding of a pre-election conference on February 26, 1997. Petitioner filed a
motion for reconsideration, but it was denied on September 23, 1996. The pre-election conference was
not held as initially scheduled; it was held a year later, or on February 20, 1998. Petitioner moved to
archive or to dismiss the petition due to alleged repeated non-appearance of respondent. The latter
agreed to suspend proceedings until further notice. The pre-election conference resumed on January
29, 2000. Subsequently, petitioner discovered that respondent had failed to submit to the Bureau of
Labor Relations (BLR) its annual financial report for several years and the list of its members since it
filed its registration papers in 1995. Consequently, on May 19, 2000, petitioner filed a Petition for
Cancellation of Registration of respondent, on the ground of the non-submission of the said
documents. Petitioner prayed that respondent's Certificate of Creation of Local/Chapter be cancelled
and its name be deleted from the list of legitimate labor organizations. It further requested the
suspension of the certification election proceedings.
Issue:
Whether or not the non-submission of financial reports warrant the cancellation of the respondent’s
registration
Ruling:
No. The respondent's registration as a legitimate labor union should not be cancelled. The Regional
Director has ample discretion in dealing with a petition for cancellation of a union's registration,
particularly, determining whether the union still meets the requirements prescribed by law. It is
sufficient to give the Regional Director license to treat the late filing of required documents as
sufficient compliance with the requirements of the law. After all, the law requires the labor
organization to submit the annual financial report and list of members in order to verify if it is still
viable and financially sustainable as an organization so as to protect the employer and employees from
fraudulent or fly-by-night unions. With the submission of the required documents by respondent, the
purpose of the law has been achieved, though belatedly.

98. LEGEND INTERNATIONAL RESORTS LTD. v. KILUSANG MANGGAGAWA NG LEGEND

Facts:
On June 6, 2001, KML filed with the Med-Arbitrater a Petition for Certification Election. KML alleged that it is a
legitimate labor organization of the rank and file employees of Legend International Resorts Limited
(LEGEND). LEGEND moved to dismiss the petition alleging that KML is not a legitimate labor organization
because its membership is a mixture of rank and file and supervisory employees in violation of Article 245
of the Labor Code. LEGEND also claimed that KML committed acts of fraud and misrepresentation when it
made it appear that certain employees attended its general membership meeting on April 5, 2001 when in
reality some of them were either at work; have already resigned as of March 2001; or were abroad. In its
Comment, KML argued that even if 41 of its members are indeed supervisory employees and therefore
excluded from its membership, the certification election could still proceed because the required number of
the total rank and file employees necessary for certification purposes is still sustained. KML also claimed that
its legitimacy as a labor union could not be collaterally attacked in the certification election proceedings but
only through a separate and independent action for cancellation of union registration. Finally, as to the alleged
acts of misrepresentation, KML asserted that LEGEND failed to substantiate its claim.
ISSUE:
Whether or not the legitimacy of the legal personality of KML may be collaterally attacked in a petition for
certification election.
HELD:
No. The legitimacy of the legal personality of KML cannot be collaterally attacked in a petition for certification
election proceeding. This is in consonance with our ruling in Laguna Autoparts Manufacturing Corporation v.
Office of the Secretary, Department of Labor and Employment that such legal personality may not be subject
to a collateral attack but only through a separate action instituted particularly for the purpose of assailing it.
The Court further held therein that to raise the issue of the respondent unions legal personality is not proper
in this case. The pronouncement of the Labor Relations Division Chief, that the respondent union acquired a
legal personality x x x cannot be challenged in a petition for certification election. The discussion of the
Secretary of Labor and Employment on this point is also enlightening. Section 5, Rule V of D.O. 9 is instructive
on the matter. It provides that the legal personality of a union cannot be the subject of collateral attack in a
petition for certification election, but may be questioned only in an independent petition for cancellation of
union registration. This has been the rule since NUBE v. Minister of Labor, 110 SCRA 274 (1981). What applies
in this case is the principle that once a union acquires a legitimate status as a labor organization, it continues
as such until its certificate of registration is cancelled or revoked in an independent action for cancellation. The
legal personality of a legitimate labor organization x x x cannot be subject to a collateral attack. The law is very
clear on this matter. x x x The Implementing Rules stipulate that a labor organization shall be deemed
registered and vested with legal personality on the date of issuance of its certificate of registration. Once a

certificate of registration is issued to a union, its legal personality cannot be subject to a collateral attack. In
may be questioned only in an independent petition for cancellation in accordance with Section 5 of Rule V,
Book V of the Implementing Rules.

We cannot ascribe abuse of discretion to the Regional Director and the DOLE Secretary in denying the
petition for cancellation of respondent's registration. The union members and, in fact, all the
employees belonging to the appropriate bargaining unit should not be deprived of a bargaining agent,
merely because of the negligence of the union officers who were responsible for the submission of
the documents to the BLR. Labor authorities should, indeed, act with circumspection in treating
petitions for cancellation of union registration, lest they be accused of interfering with union activities.
In resolving the petition, consideration must be taken of the fundamental rights guaranteed by Article
XIII, Section 3 of the Constitution, i.e., the rights of all workers to self-organization, collective
bargaining and negotiations, and peaceful concerted activities. Labor authorities should bear in mind
that registration confers upon a union the status of legitimacy and the concomitant right and privileges
granted by law to a legitimate labor organization, particularly the right to participate in or ask for
certification election in a bargaining unit. Thus, 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. It is worth mentioning that the Labor Code's provisions on
cancellation of union registration and on reportorial requirements have been recently amended by
Republic Act (R.A.) No. 9481. The amendment sought to strengthen the workers' right to self-
organization and enhance the Philippines' compliance with its international obligations as embodied in
the International Labour Organization (ILO) Convention No. 87, pertaining to the non-dissolution of
workers' organizations by administrative authority. Thus, R.A. No. 9481 inserted in the Labor Code
Article 242-A, which provides: ART. 242-A. Reportorial Requirements.-The following are documents
required to be submitted to the Bureau by the legitimate labor organization concerned: xxx xxx (c) Its
annual financial report within thirty (30) days after the close of every fiscal year; and xxx xxx Failure to
comply with the above requirements shall not be a ground for cancellation of union registration but
shall subject the erring officers or members to suspension, expulsion from membership, or any
appropriate penalty. ILO Convention No. 87, which we have ratified in 1953, provides that "workers'
and employers' organizations shall not be liable to be dissolved or suspended by administrative
authority." The ILO has expressed the opinion that the cancellation of union registration by the
registrar of labor unions, which in our case is the BLR, is tantamount to dissolution of the organization
by administrative authority when such measure would give rise to the loss of legal personality of the
union or loss of advantages necessary for it to carry out its activities, which is true in our jurisdiction.
Although the ILO has allowed such measure to be taken, provided that judicial safeguards are in place,
i.e., the right to appeal to a judicial body, it has nonetheless reminded its members that dissolution of
a union, and cancellation of registration for that matter, involve serious consequences for occupational
representation. It has, therefore, deemed it preferable if such actions were to be taken only as a last
resort and after exhausting other possibilities with less serious effects on the organization. It is
undisputed that appellee failed to submit its annual financial reports and list of individual members in
accordance with Article 239 of the Labor Code. However, the existence of this ground should not
necessarily lead to the cancellation of union registration. Article 239 recognizes the regulatory
authority of the State to exact compliance with reporting requirements. Yet there is more at stake in
this case than merely monitoring union activities and requiring periodic documentation thereof. The
more substantive considerations involve the constitutionally guaranteed freedom of association and
right of workers to self-organization. Also involved is the public policy to promote free trade unionism
and collective bargaining as instruments of industrial peace and democracy. An overly stringent
interpretation of the statute governing cancellation of union registration without regard to surrounding
circumstances cannot be allowed. Otherwise, it would lead to an unconstitutional application of the
statute and emasculation of public policy objectives. Worse, it can render nugatory the protection to
labor and social justice clauses that pervades the Constitution and the Labor Code.

Moreover, submission of the required documents is the duty of the officers of the union. It would be
unreasonable for this Office to order the cancellation of the union and penalize the entire union
membership on the basis of the negligence of its officers. In National Union of Bank Employees vs.
Minister of Labor, the Supreme Court ruled: As aptly ruled by respondent Bureau of Labor Relations
Director Noriel: "The rights of workers to selforganization finds general and specific constitutional
guarantees. x x x Such constitutional guarantees should not be lightly taken much less nullified. A
healthy respect for the freedom of association demands that acts imputable to officers or members be
not easily visited with capital punishments against the association itself." At any rate, we note that on
19 May 2000, appellee had submitted its financial statement for the years 1996-1999. With this
submission, appellee has substantially complied with its duty to submit its financial report for the said
period. To rule differently would be to preclude the union, after having failed to meet its periodic
obligations promptly, from taking appropriate measures to correct its omissions. For the record, we do
not view with favor appellee's late submission. Punctuality on the part of the union and its officers
could have prevented this petition.

99. RP REPRESENTED BY DOLE v. KAWASHIMA TEXTILE

FACTS:
KFWU filed with DOLE Regional Office No. IV, a Petition for Certification Election to be conducted in the
bargaining unit composed of 145 rank-and-file employees of respondent.

Respondent-company filed a Motion to Dismiss the petition on the ground that KFWU did not acquire any
legal personality because its membership of mixed rank-and-file and supervisory employees violated

Article 245 of the Labor Code, and its failure to submit its books of account contravened the ruling of the
Court in Progressive Development Corporation v. Secretary, Department of Labor and Employment.
ISSUES:
(1) whether a mixed membership of rank-and-file and supervisory employees in a union is a ground for the
dismissal of a petition for certification election.
(2) whether the legitimacy of a duly registered labor organization can be collaterally attacked in a petition
for a certification election through a motion to dismiss.
HELD:
1. NO. The key to the closure that petitioner seeks could have been Republic Act (R.A.) No. 9481 [AN ACT
STRENGTHENINGTHEWORKERS’ CONSTITUTIONAL RIGHT TO SELF- ORGANIZATION, AMENDING FOR
THE PURPOSE PRESIDENTIAL DECREE NO. 442, AS AMENDED, OTHERWISE KNOWN AS THE LABOR
CODE OF THE PHILIPPINES] Sections 8 and 9.
However, R.A. No. 9481 took effect only on June 14, 2007; hence, it applies only to labor representation cases
filed on or after said date. As the petition for certification election subject matter of the present petition was
filed by KFWU on January 24, 2000,28
R.A. No. 9481 cannot apply to it. There may have been curative labor legislations that were given retrospective
effect, but not the aforecited provisions of
R.A. No. 9481, for otherwise, substantive rights and interests already vested would be impaired in the process.

Instead, the law and rules in force at the time of the filing by KFWU of the petition for certification election on
January 24, 2000 are R.A. No. 6715, amending Book V of Presidential Decree (P.D.) No. 442 (Labor Code),as
amended, and the Rules and Regulations Implementing R.A. No. 6715,34 as amended by Department Order
No. 9, series of 1997.

One area of contention has been the composition of the membership of a labor organization, specifically
whether there is a mingling of supervisory and rank- and-file employees and how such questioned mingling
affects its legitimacy.

Effective 1989, R.A. No. 6715 restored the prohibition against the questioned mingling in one labor
organization, viz:

Sec. 18. Article 245 of the same Code, as amended, is hereby further amended to read as follows

“Art. 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 a labor organization of the rank-and-file employees but may join, assist
or form separate labor organizations of their own.” (Emphasis supplied)
Unfortunately, just like R.A. No. 875, R.A. No. 6715 omitted specifying the exact effect any violation of the
prohibition would bring about on the legitimacy of a labor organization.

Thus, when the issue of the effect of mingling was brought to the fore in Toyota, the Court, citing Article 245
of the Labor Code, as amended by R.A. No. 6715, held:

Clearly, based on this provision, 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 xxxx

In the case at bar, as respondent union’s membership list contains the names of at least twenty-seven (27)
supervisory employees in Level Five positions, the union could not, prior to purging itself of its supervisory
employee members, attain the status of a legitimate labor organization. Not being one, it cannot possess the
requisite personality to file a petition for certification election.

But then, on June 21, 1997, the 1989 Amended Omnibus Rules was further amended by Department Order
No. 9, series of 1997 (1997 Amended Omnibus Rules). Specifically, the requirement under Sec. 2(c) of the 1989
Amended Omnibus Rules – that the petition for certification election indicate that the bargaining unit of
rank-and-file employees has not been mingled with supervisory employees – was removed. Consequently,
the Court reinstates that of the DOLE granting the petition for certification election of KFWU.
2. NO. Except when it is requested to bargain collectively, an employer is a mere bystander to any
petition for certification election; such proceeding is non- adversarial and merely investigative, for the
purpose thereof is to determine which organization will represent the employees in their collective
bargaining with the employer. The choice of their representative is the exclusive concern of the
employees; the employer cannot have any partisan interest therein; it cannot interfere with, much less
oppose, the process by filing a motion to dismiss or an appeal from it; not even a mere allegation that
some employees participating in a petition for certification election are actually managerial employees
will lend an employer legal personality to block the certification election. The employer’s only right in
 the proceeding is to be notified or informed thereof. The amendments to the Labor Code and its
implementing rules have buttressed that policy even more.

100. DHL PHILS. UNITED RANK AND FILE ASSOC. v. BUKLOD NG MANGGAGAWA NG DHL PHILS.
Facts:
A certification election was conducted among the regular rank and file employees in the main office and the
regional branches of DHL Philippines Corporation on November 25, 1997. The contending choices were
petitioner and "no union."

However, on December 19, 1997, a petition for the nullification for the certification election was filed by the
respondent Buklod ng Manggagawa ng DHL Philippines Corporation (BUKLOD) with the Industrial Relations
Division of the Department of Labor and Employment (DOLE) on the ground of fraud and deceit, particularly
by misrepresenting to the employees that it was an independent union even if it was an affiliate of the
Federation of Free Workers (FFW).

Those who found out withdrew their membership and formed BUKLOD, whose Certificate of Registration was
issued by DOLE on December 23, 1997.

Come January 19, 1998, petitioner received 546 votes and "no union" garnering 348 votes, and was certified
by the election officer as the sole and exclusive bargaining agent of the rank and file employees of the
corporation.

The Med-Arbiter Tomas F. Falconitin nullified the November 25, 1997 certification election and ordered the
conduct of a new one with respondent as one of the choices, alongside petitioner and “no choice.” This
decision was reversed by DOLE Undersecretary Rosalinda Dimapilis-Baldoz.

Upon reaching the Court of Appeals, it held that the withdrawal of 704 out of 894 members of the petitioner
union was a valid impetus to hold a new certification election.

Issue:
Is the certification election valid?

Ruling:
NO. The petitioner hinges the validity of the decision of the election officer on the fact that no protest for the
misrepresentation was filed during the election or within 5 days from the close thereof. However, the Court
held that “when the med-arbiter admitted and gave due course to respondent’s Petition for nullification of the
election proceedings, the election officer should have deferred issuing the Certification of the results thereof.
Section 13 of the Implementing Rules cannot strictly be applied to the present case.”

Respondents voted in favor of the petitioner because it was their desire to have an independent union.
However, this misrepresentation caused them to disaffiliate and form a new union. Upon filing the application
but prior the issuance of a certificate of registration, the respondent already filed its petition to nullify the
certification election. This was opposed by petitioner on the ground that there was no certificate issued to
respondent yet. However, the court held that “because such certificate was issued in favor of the latter
[respondent] four days after the filing of the Petition, on December 23, 1997, the misgivings of the former
were brushed aside by the med-arbiter. Indeed, the fact that respondent was not yet a duly registered labor
organization when the Petition was filed is of no moment, absent any fatal defect in its application for
registration.”

Moreover, the respondents did not sleep on their rights. “Hence, their failure to follow strictly the procedural
technicalities regarding the period for filing their protest should not be taken against them. Mere technicalities
should not be allowed to prevail over the welfare of the workers. What is essential is that they be accorded an
opportunity to determine freely and intelligently which labor organization shall act on their behalf. Having
been denied this opportunity by the betrayal committed by petitioner’s officers in the present case, the
employees were prevented from making an intelligent and independent choice.”

Lastly, the Court held that “a certification election may be set aside for misstatements made during the
campaign, where 1) a material fact has been misrepresented in the campaign; 2) an opportunity for reply has
been lacking; and 3) the misrepresentation has had an impact on the free choice of the employees
participating in the election.” The misrepresentation was committed by the officers of the petitioner, and
petitioner cannot claim that there was sufficient time between the said misrepresentation and election to
ascertain the truth of petitioner’s statements.
101. ASIAN INSTITUTE MANAGEMENT v. ASIAN INSTITUTE IF MANAGEMENT FACULTY ASSOC.
Facts:
On May 16, 2007, respondent filed a petition for certification election6 seeking to represent a bargaining unit
in AIM consisting of forty faculty members. Petitioner opposed the petition, claiming that respondent's
members are neither rank-and-file nor supervisory, but rather, and managerial employees. On July 11, 2007,
petitioner filed a petition for cancellation of respondent's certificate of registration on the grounds of
misrepresentation in registration and that respondent is composed of managerial employees who are
prohibited from organizing as a union.
Issue:
Whether or not the members of AIMFA are managerial employees.
Held:
YES. Article 212 of the Labor Code defines managerial employees as: 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. 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.'

There are, therefore, two kinds of managerial employees under Art. 212 of the Labor Code. Those who 'lay
down management policies', such as the Board of Trustees, and those who 'execute management policies
and/or hire, transfer, suspend, lay-off, recall, discharge, assign or discipline employees'.

102. OCAMPO MEMORIAL SCHOOLS, INC. v. BIGKIS NG MANGGAGAWA SA DE OCAMPO MEMORIAL

SCHOOL
FACTS:
De Ocampo Memorial Schools, Inc. is a domestic corporation duly-organized and existing under the laws of the
Philippines. De Ocampo Memorial Medical Center and De Ocampo Memorial College. Under the
aforementioned institution is Bigkis Manggagawa ng De Ocampo Medical Center a union which was granted
Union Registration No. on September 26, 2003. Another permit was issued for Bigkis Manggagawa ng De
Ocampo Memorial School, Inc. dated December 5, 2003; Union Registration/Certificate of Creation of Local
Chapter No. NCR-l 2-CC-002-2003, declaring that they are legitimate organization.

A Petition for Cancellation of Certificate of Registration with the Department of Labor and Employment -
National Capital Region was filed by De Ocampo against Bigkis Manggagawa ng De Ocampo Memorial School,
Inc. dated March 4, 2004. Stating in the petition the grounds of revocation of registration 1.)
Misrepresentation of declaring the officers and members 2.) Mixed membership of rank file 3.) Inappropriate
bargaining unit.

A Comment-Opposition was then filed by BMDOMSI, denying De Ocampo's allegations and claiming that the
latter only wants to impede the formation of the union.

A decision of Acting Regional Director Ciriaco A. Lagunzad III of the DOLE-NCR ruled that BMDOMSI committed
misrepresentation by making it appear that the bargaining unit is composed of faculty and technical
employees, dated July 26, 2004.

The respondents then filed an appeal to Bureau of Labor Relations. On December 29, 2004, a decision was
released by BLR reversing the Regional Director's finding of misrepresentation, false statement or fraud in
BMDOMSI’s application for registration.

According to BLR the petitioner failed to present proof to support its allegation of mixed membership within
respondent union. Certiorari was filed by the petitioner to the CA seeking to annul and set aside the BLR
Decision as well as the Resolution dated January 24, 2005 denying its motion for reconsideration. CA affirmed
the Decision of the BLR. It ruled that there was no misrepresentation, false statement or fraud in the
application for registration. The respondents were able to substantiate that there have been no
misrepresentation as the members appearing in the minutes of the general membership meeting BMDOMSI
Union, and the list of members who attended the meeting and ratified the union constitution and by-laws, are
in truth employees of the school, though some service the hospital.

Although, the CA observed that the members of the union, who are from academic, non-academic, and
general services, do not perform work of the same nature and these factors dictate the separation of the
categories of employees for purposes of collective bargaining, the CA reasoned that such lack of mutuality and
commonality of interest of the union members is not among the grounds for cancellation of union registration
under Article 247 of the Labor Code.

ISSUE:
Whether or not De Ocampo Bigkis Manggagawa ng De Ocampo Memorial School, Inc. Union Registration
should be revoked
HELD:
No. The respondents did not violate any regulation for them to have grounds for cancelation of their Union
Registration. BMDOMSI Union was able to testify to the court that there were no misrepresentation, mixed
membership and inappropriate bargaining unit in their union. The CA ruled the according to Article 247 of the
Labor Code provides: Art. 247. Grounds for Cancellation of Union Registration. The following may constitute
grounds for cancellation of union registration:

1.) 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;

2.)Misrepresentation, false statements or fraud in connection with the election of officers, minutes of the
election of officers, and the list of voters;

3.) Voluntary dissolution by the members.

The petitioner was not able to establish to the court the violation alleged to the respondents, wherefore CA
decision favored for BMDOMSI, and declaring the petition denied for lack of merit.

BARGAINING UNIT

Omnibus Rules as amended by DO 40-03, Book V, Rule I, Section 1 (d,t)

(d) “Audit Examiner” refers to an officer of the Bureau or Labor Relations Division of the Regional Office
authorized to conduct an audit or examination of the books of accounts, including all funds, assets and other
accountabilities of a legitimate labor organization and workers’ association.

(t) “Employer” refers to any person or entity who employs the services of others, one for whom employees
work and who pays their wages or salaries. An employer includes any person directly or indirectly acting in the
interest of an employer. It shall also refer to the enterprise where a labor organization operates or seeks to
operate.

Cases:
103. SAN MIGUEL CORP. v. LAGUESMA
FACTS:
Petitioner Union filed before the DOLE a Petition for District Certification or Certification Election among the
supervisors and exempt employees of the SMC Magnolia Poultry Products Plants of Cabuyao, San Fernando
and Otis. The Med-Arbiter issued an Order to conduct certification among the supervisors and exempt
employees of the SMC Magnolia Poultry Plants of Cabuyao, San Fernando and Otis as one bargaining unit.

Respondent SMC filed a Notice of Appeal with Memorandum of Appeal, pointing out, among others, the Med-
Arbiter’s error in grouping together all three
(3) separate plants into one bargaining unit, and in including supervisory levels 3 and above whose positions
are confidential in nature since they have access to information which is regarded by the employer to be
confidential from the business standpoint. Laguesma granted respondent company’s appeal and ordered the
remand of the case to the Med-Arbiter of origin for determination of the true classification of each of the
employees sought to be included in the appropriate bargaining unit.

Laguesma granted respondent company’s appeal and ordered the remand of the case to the Med-Arbiter of
origin for determination of the true classification of each employees sought to be included in the appropriate
bargaining unit. Upon petitioner’s motion, Laguesma granted the reconsideration and directed the conduct of
separate certification elections among the supervisors ranked as supervisory levels 1 to 4 and the exempt
employees in each of the three plants.
ISSUE:
If they are not confidential employees, do the employees of the three plants constitute an appropriate
bargaining unit?
Ruling:
YES. An appropriate bargaining unit may be 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 to be best suited to serve the reciprocal rights and duties of
the parties under the collective bargaining provisions of the law.

It is readily seen that the employees in the instant case have community or mutuality of interest, 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. We rule that 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.

104.DE LA SALLE v. DE LA SALLE EMPLOYEE ASSOCIATION

Facts:
DLSU and the UNION (composed of regular non- academic R&F) entered into a CBA. 60 days before its
expiration, the union initiated negotiations which were unsuccessful. The Union filed a Notice of Strike with
the NCMB. During conciliation, 5 out of 11 issues were resolved by parties.
ISSUE:
Are computer operators and discipline officers (which were previously excluded) confidential employees?
RULING:
NO. 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.

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. 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.

105. INTERNATIONAL SCHOOL ALLIANCE OF EDUCATORS v. QUISUMBING

FACTS:
International School Alliance of Educators (the School) hires both foreign and local teachers as members of its
faculty, classifying the same into two: (1) foreign-hires and (2) local-hires.

In which, the School grants foreign-hires certain benefits not accorded local-hires including housing,
transportation, shipping costs, taxes, home leave travel allowance and a salary rate 25% more than local hires
based on “significant economic disadvantages”

The labor union and the collective bargaining representative of all faculty members of the School, contested
the difference in salary rates between foreign and local-hires.

The Union claims that the point-of-hire classification employed by the School is discriminatory to Filipinos and
that the grant of higher salaries to foreign-hires constitutes racial discrimination.

ISSUE:
Whether or not the Union can invoke the equal protection clause to justify its claim of parity.

RULING:
Yes. The Labor Code’s and the Constitution’s provisions impregnably institutionalize in this jurisdiction the
long honored legal truism of "equal pay for equal work." Persons who work with substantially equal
qualifications, skill, effort and responsibility, under similar conditions, should be paid similar salaries.

If an employer accords employees the same position and rank, the presumption is that these employees
perform equal work. If the employer pays one employee less than the rest, it is not for that employee to
explain why he receives less or why the others receive more. That would be adding insult to injury.
The employer in this case has failed to discharge this burden. There is no evidence here that foreign-hires
perform 25% more efficiently or effectively than the local-hires. Both groups have similar functions and
responsibilities, which they perform under similar working conditions.

Hence, the Court finds the point-of-hire classification employed by respondent School to justify the distinction
in the salary rates of foreign-hires and local hires to be an invalid classification. There is no reasonable
distinction between the services rendered by foreign-hires and local-hires.