Religious Objectors

Victoriano vs Elizalde Rope Workers’ Union, G.r. No. :L-25246, September 12, 1974

Facts: Petitioner Victoriano is a member of the Iglesia ni Cristo and was an employee of Elizalde Rope
Factory and was a member of the Elizalde Rope Workers' Union. Membership with the Union was mandatory
as provided for under a collective bargaining agreement: "Membership in the Union shall be required as a
condition of employment for all permanent employees workers covered by this Agreement."

Under Section 4(a), paragraph 4, of Republic Act No. 875, prior to its amendment by Republic Act
No. 3350, the employer was not precluded "from making an agreement with a labor organization to require
as a condition of employment membership therein, if such labor organization is the representative of the
employees." On June 18, 1961, however, Republic Act No. 3350 was enacted, introducing an amendment to
— paragraph (4) subsection (a) of section 4 of Republic Act No. 875, as follows: ... "but such agreement shall
not cover members of any religious sects which prohibit affiliation of their members in any such labor
organization".

Being a member of the INC, a religion that prohibits affiliation with labor organizations, the Petitioner
wrote a letter informing the Union of his resignation. Thereupon, the Union wrote a formal letter to the
Company asking the latter to separate Appellee from the service in view of the fact that he was resigning
from the Union as a member.

The CFI ruled in favor of Petitioner and enjoined the company from dismissing him.

In its appeal, the Union claimed that R.A. no. 3350 was unconstitutional on the ground that 1) prohibits
all the members of a given religious sect from joining any labor union if such sect prohibits affiliations of their
members thereto; and, consequently, deprives said members of their constitutional right to form or join lawful
associations or organizations guaranteed by the Bill of Rights, and thus becomes obnoxious [to the]
Constitution; 2) Impairs the obligation of contracts; 3) discriminates in favor of certain religious sects and
affords no protection to labor unions; 4) violates the constitutional provision that no religious test shall be
required for the exercise of a civil right; 5) violates the equal protection clause; and 6) the act violates the
constitutional provision regarding the promotion of social justice.

Issue: WON R.A. No. 3350 violates the Constitutional mandate to protect the rights of workers and to promote
their welfare notwithstanding the fact that it allows some workers, by virtue of their religious beliefs, to opt out
of Union security agreements.

Held: NO. R.A. No. 3350 is constitutional on all counts. It must be pointed out that the free exercise
of religious profession or belief is superior to contract rights. In case of conflict, the latter must,
therefore, yield to the former.

The purpose of Republic Act No. 3350 is secular, worldly, and temporal, not spiritual or religious or
holy and eternal. It was intended to serve the secular purpose of advancing the constitutional right to the free
exercise of religion, by averting that certain persons be refused work, or be dismissed from work, or be
dispossessed of their right to work and of being impeded to pursue a modest means of livelihood, by reason
of union security agreements.

More so now in the [1987 and past in constitutions] [...] where it is mandated that "the State shall
afford protection to labor, promote full employment and equality in employment, ensure equal work
opportunities regardless of sex, race or creed and regulate the relation between workers and
employers.

We believe that in enacting Republic Act No. 3350, Congress acted consistently with the spirit of the
constitutional provision. It acted merely to relieve the exercise of religion, by certain persons, of a burden that
is imposed by union security agreements. It was Congress itself that imposed that burden when it enacted
the Industrial Peace Act (Republic Act 875), and, certainly, Congress, if it so deems advisable, could take
away the same burden. It is certain that not every conscience can be accommodated by all the laws of the
land; but when general laws conflict with scrupples of conscience, exemptions ought to be granted unless
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some "compelling state interest" intervenes. In the instant case, We see no such compelling state interest to
withhold exemption.

Kapatiran sa Meat and canning Division vs The Honorable BLR Director Pura Ferer-Calleja,
G.R.No. L-82914, June 20, 1988

FACTS: From 1984 to 1987 Petitioner Kapatiran sa Meat and Canning Division (TUPAS) was the
sole and exclusive collective bargaining representative of the workers in the Meat and Canning
Division of the Universal Robina Corporation, with a 3-year collective bargaining agreement (CBA)
which was to expire on November 15, 1987.

Within the freedom period of 60 days prior to the expiration of its CBA, TUPAS filed an
amended notice of strike as a means of pressuring the company to extend, renew, or negotiate a
new CBA with it.

On October 8, 1987, the NEW ULO, composed mostly of workers belonging to the IGLESIA
NI KRISTO sect, registered as a labor union.

On October 12, 1987, the TUPAS staged a strike. ROBINA obtained an injunction against
the strike, resulting in an agreement to return to work and for the parties to negotiate a new CBA.

The next day NEW ULO filed a petition for a certification election at the Bureau of Labor
Relations.

TUPAS moved to dismiss the petition claiming among others that the members of the NEW
ULO were mostly members of the Iglesia ni Kristo sect which three years previous refused to affiliate
with any labor union. It also accused the company of using the NEW ULO to defeat TUPAS’
bargaining rights.

The Med-Arbiter ordered the holding of a certification election.

TUPAS appealed to the Bureau of Labor Relations. In the meantime, it was able to negotiate
a new 3-year CBA with ROBINA, which was signed on December 3, 1987 and to expire on
November 15, 1990.

On January 27, 1988, respondent BLR Director Calleja dismissed the appeal.

ISSUE: W/N members of a sect who are not allowed by their religion to join a labor union may form
their own union?

HELD: YES. This Court’s decision in Victoriano vs. Elizalde Rope Workers’ Union, 59 SCRA 54,
upholding the right of members of the IGLESIA NI KRISTO sect not to join a labor union for being
contrary to their religious beliefs, does not bar the members of that sect from forming their own
union. The public respondent correctly observed that the “recognition of the tenets of the sect …
should not infringe on the basic right of self-organization granted by the constitution to workers,
regardless of religious affiliation.”

The fact that TUPAS was able to negotiate a new CBA with ROBINA within the 60-day freedom
period of the existing CBA, does not foreclose the right of the rival union, NEW ULO, to challenge
TUPAS’ claim to majority status, by filing a timely petition for certification election before TUPAS’
old CBA expired and before it signed a new CBA with the company. As pointed out by Med-Arbiter
Abdullah, a “certification election is the best forum in ascertaining the majority status of the
contending unions wherein the workers themselves can freely choose their bargaining

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representative thru secret ballot.” Since it has not been shown that this order is tainted with
unfairness, this Court will not thwart the holding of a certification election (Associated Trade Unions
[ATU] vs. Noriel, 88 SCRA 96).

Government Employees

Arizala, et al. vs Court of Appeals, et al, G.R. Nos. L-43633-34, September 14, 1990

Facts: It was under the Industrial Peace Act that the GSIS became bound by a collective bargaining
agreement with the labor organization representing the majority of its employees, the GSIS
Employees Association. The agreement contained a “maintenance-of-membership” clause, i.e., that
all employees who, at the time of the execution of said agreement, were members of the union or
became members thereafter, were obliged to maintain their union membership in good standing for
the duration of the agreement as a condition for their continued employment in the GSIS.

All the petitioners are employees of supervisory positions in the GSIS. Demands were made
for their resignation in the GSIS Employees Association, in which they refused to do so. In their
appeal, they argued that when the 1973 Constitution took effect in January 17, the case of Arizala
and Amribao was still pending in the CA and that of Joven and Bulandus, pending decision in the
City Court of Cebu; that since provisions of the said constitution and the subsequently promulgated
Labor Code, repealing the Industrial Peace Act – placed employees of all categories in government-
owned or controlled corporations without distinction to CSC, and provided that the terms and
conditions of their employment were to be “governed by the Civil Service law, rules and regulations”
and hence, no longer subject to collective bargaining, the appellant ceased to fall within the coverage
of the Industrial Peace Act and should thus no longer continue to be prosecuted and exposed to
punishment for a violation thereof. They pointed out further that the criminal sanction in the Industrial
Peace Act no longer appeared in the Labor Code. The appellate court denied their plea for
reconsideration.

Issue: WON the membership of the petitioners in the GSIS Employees Association is considered
revoked due to the fact that they are holding supervisory positions in GSIS

Held: NO. Under RA 6715 labor unions are regarded as organized either (a) "for purposes of
negotiation," or (b) "for furtherance and protection"of the members' rights. Membership in unions
organized "for purposes of negotiation" is open only to rank-and-file employees. "Supervisory
employees" are ineligible "for membership in a labor organization of the rank-and-file employees but
may join, assist or form separate labor organizations of their own," i.e., one organized "for
furtherance and protection" of their rights and interests. However, according to the Rules
implementing RA 6715, "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 ..." 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.

Membership in employees' organizations formed for purposes of negotiation are open to rank-and-
file employees only, as above mentioned, and not to high level employees. Indeed, "managerial
employees" or "high level employees" are, to repeat, "not eligible to join, assist or form any labor
organization" at all. A managerial employee is defined as "one who is vested with powers or
prerogatives to lay down and execute, management policies and/or to hire, transfer, suspend, lay-
off, recall, discharge, assign or discipline employees."

This is how the law now stands, particularly with respect to supervisory employees vis a vis labor
organizations of employees under them.

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Excepted Employee and Professors as Rank-and-File Employees

University of the Philippines vs Ferrer-Callega G.R. No. 96189, July 14, 1992

Doctrine/Subject: Right to Self-Organization

FACTS:
- March 2, 1990 - The Organization of Non-Academic Personnel of UP (ONAPUP) filed a petition
for certification of election before the Bureau of Labor Relations (BLR) to which the University of the
Philippines (UP) had no objection to the election
o ONAPUP claims to have a membership of 3,236 members where 33% are non- academic
personnel of UP-Diliman, Los Baños, Manila, and Visayas.
- April 18, 1990 – another registered labor union, the All UP Workers’ Union (AUPWU)
filed a comment as intervenor in the certification election proceeding.
o It alleges that its membership covers both academic and non-academic personnel and that it
aims to unite all UP rank-and-file employees in one union
o It assent to the holding of the election provided the appropriate organization unit was clearly
defined.
o It observed in this connection that the Research, Extension and Professional Staff (REPS),
who are academic non-teaching personnel, should not be deemed part of the organizational unit.
- UP on the other hand made records of its view that there should be 2 unions one for academic
and the other for non-academic or administrative personnel considering the dichotomy of interest,
conditions and rules governing these employees.
- Aug 7, 1990 - Director Pura Ferrer-Calleja (Calleja) declared that the organizational unit
should embrace all rank-and-file employees both academic and non-academic, teaching and non-
teaching as stated in Sec. 9 of EO. No. 180.
- Calleja commanded that a certification election be conducted among all rank-and-file
employees in all of the 4 campuses and that management appear and bring copies of the
corresponding payrolls for Jan, June, and July, 1990 at the usual pre-election conference
- Mar 22, 1990 – At the pre-election conference, UP sought clarification of the term “rank- and-
file” since there were some teaching and non-teaching employees whose functions were in fact
managerial and policy-determining,
- It sought the exclusion of high level employees pursuant to Sec. 3 of EO 180.
o Sec. 3. High-level employees whose functions are normally considered as policy-making or
managerial or whose duties are of a highly confidential nature shall not be eligible to join the
organization of rank-and file government employees;

- It claims that the following should not be considered rank-and-file:

o Those with the rank of professor or higher;

o Those administrative employees holding positions of Grade 18 or higher

- UP claims that these employees perform supervisory functions and are vested with effective
recommendatory powers. As to the professors, these academic staff are members of the University
Council, a policy making body

- ONAPUP did not oppose UP’s classification. All UP remained firm in its stance to unite all the
rank-and-file employees under a single organizational unit.

- Calleja’s 2nd order declared that professors are rank-and-file employees as stated in Sec.1
Rule1, IRRs of EO 180:

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o 1. High Level Employee – is one whose functions are normally considered policy determining,
managerial or one whose duties are highly confidential in nature. A managerial function refers to the
exercise of powers such as:

1. To Effectively recommend such managerial actions;

2. To Formulate or execute management policies and decisions; or

3. To Hire, transfer, suspend, lay-off, recall, dismiss, assign or discipline employees

- Calleja stated that a careful perusal of the University Code shows that the policy making
powers of the Council are limited to academic matters, namely prescribing courses of study and
rules of discipline, fixing student admission and graduation requirements, recommending to the
Board of Regents the conferment of degrees and disciplinary power over students.

- On the other hand, the policies referred to in the definition of high level employees refers to
labor-related policies like hiring, firing, discipline, labor standards and benefits, and terms and
conditions of employment.

- Motion for reconsideration was filed by UP which was denied hence this petition.

ISSUE:
1) WON academic personnel should form a distinct collective bargaining unit from those non-
academic employees of the university.
2) WON professors, associate professors and assistant professors are high-level employees

RULING:
1) YES, although there was no standard mentioned in forming a collective bargaining unit the
Supreme Court referred to American Jurisprudence for guidance and have followed principles in the
American Magna Carta which stated that the collective bargaining unit must be based on the
following factors:
o Will of the employees (Global Doctrine)
o Affinity an unit of employees’ interest --- substantial similarity of work and duties or similarity
of compensation and working conditions
o Prior collective bargaining agreement history
o Employment status --- temporary, seasonal, probationary

Furthermore the Supreme Court also followed the 10th Annual Report of the NLRB which sets the
following factors:
o History, extent and type of organization of employees
o History of their collective bargaining
o History, extent and type or organization of employees in other plants of the same employer,
or other employers in the same industry
o The skill, wages, work and working conditions of the employees
o The desires of the employees
o The eligibility of the employees for membership in the unions/s involved; and
o The relationship between the unit/s proposed and the employer’s organization, management
,and operation
Combing these two sets of factors form the community or mutuality of interest tests

To summarize it, the two groups have nothing mutual in common and have different interests thus
should have their own collective bargaining units.

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2) No, although professors supposedly exercise managerial functions (forming policies, rules
and standards) they are purely recommendatory in nature and is still subject to the review and
evaluation of the University Academic Personnel Board (UAPB). They are still guided by the general
guidelines drawn up by the UAPB. Finally the policy determining functions of the university council
where the professors are included merely govern the relationship between the university and the
student, not university and employees

As stated in Franklin Baker Company of the Philippines vs. Trajano, this Court reiterated the principle
laid down in National Merchandising Corp. vs. Court of Industrial Relations, that the power to
recommend, in order to qualify an employee as a supervisor or managerial employee "must not only
be effective but the exercise of such authority should not be merely of a routinary or clerical nature
but should require the use of independent judgment." Where such recommendatory powers, as in
the case at bar, are subject to evaluation, review and final action by the department heads and other
higher executives of the company, the same, although present, are not effective and not an exercise
of independent judgment as required by law.

Ineligibility of Managerial Employee

United Pepsi-Cola Supervisory Union vs Laguesma and Pepsi-Cola Products Phil. Inc., G.R.
No. 122226, March 25, 1998

FACTS: Petitioner is a union of supervisory employees. It appears that on March 20, 1995 the union
filed a petition for certification election on behalf of the route managers at Pepsi-Cola Products
Philippines, Inc. However, its petition was denied by the med-arbiter and, on appeal, by the
Secretary of Labor and Employment, on the ground that the route managers are managerial
employees and, therefore, ineligible for union membership under the first sentence of Art. 245 of the
Labor Code, which provides:

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.

Petitioner brought this suit challenging the validity of the order, dismissed.

Hence, this petition. Pressing for resolution its contention that the first sentence of Art. 245
of the Labor Code, so far as it declares managerial employees to be ineligible to form, assist or join
unions, contravenes Art. III, §8 of the Constitution which provides:

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.

ISSUES:

(1) whether the route managers at Pepsi-Cola Products Philippines, Inc. are managerial employees
and

(2) whether Art. 245, insofar as it prohibits managerial employees from forming, joining or assisting
labor unions, violates Art. III, §8 of the Constitution.

HELD: YES and NO

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 As a class, managers constitute three levels of a pyramid: (1) Top management; (2) Middle
Management; and (3) First-line Management [also called supervisors].

FIRST-LINE MANAGERS — The lowest level in an organization at which individuals are responsible
for the work of others is called first-line or first-level management. First-line managers direct
operating employees only; they do not supervise other managers. Examples of first-line managers
are the “foreman” or production supervisor in a manufacturing plant, the technical supervisor in a
research department, and the clerical supervisor in a large office. First-level managers are often
called supervisors.

MIDDLE MANAGERS — The term middle management can refer to more than one level in an
organization. Middle managers direct the activities of other managers and sometimes also those of
operating employees. Middle managers’ principal responsibilities are to direct the activities that
implement their organizations’ policies and to balance the demands of their superiors with the
capacities of their subordinates. A plant manager in an electronics firm is an example of a middle
manager.

TOP MANAGERS — Composed of a comparatively small group of executives, top management is

responsible for the overall management of the organization. It establishes operating policies and
guides the organization’s interactions with its environment. Typical titles of top managers are “chief
executive officer,” “president,” and “senior vice-president.” Actual titles vary from one organization
to another and are not always a reliable guide to membership in the highest management
classification.

A distinction exists between those who have the authority to devise, implement and control
strategic and operational policies (top and middle managers) and those whose task is simply to
ensure that such policies are carried out by the rank-and-file employees of an organization (first-
level managers/supervisors). What distinguishes them from the rank-and-file employees is that they
act in the interest of the employer in supervising such rank-and-file employees.

“Managerial employees” may therefore be said to fall into two distinct categories: the
“managers” per se, who compose the former group described above, and the “supervisors” who
form the latter group.

#1: It appears that this question was the subject of two previous determinations by the
Secretary of Labor and Employment, in accordance with which this case was decided by the
med-arbiter.

To qualify as managerial employee, there must be a clear showing of the exercise of

managerial attributes under paragraph (m), Article 212 of the Labor Code as amended. Designations
or titles of positions are not controlling. As to the route managers and accounting manager, we are
convinced that they are managerial employees. Their job descriptions clearly reveal so (Worker’s
Alliance Trade Union (WATU) v. Pepsi-Cola Products Philippines, Inc., Nov. 13, 1991)

This finding was reiterated in Case No. OS-A-3-71-92. entitled In Re: Petition for Direct
Certification and/or Certification Election-Route Managers/Supervisory Employees of Pepsi-Cola
Products Phils.Inc.

* doctrine of res judicata certainly applies to adversary administrative proceedings

Thus, we have in this case an expert’s view that the employees concerned are managerial
employees within the purview of Art. 212.

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 At the very least, the principle of finality of administrative determination compels respect for
the finding of the Secretary of Labor that route managers are managerial employees as defined by
law in the absence of anything to show that such determination is without substantial evidence to
support it.

The Court now finds that the job evaluation made by the Secretary of Labor is indeed
supported by substantial evidence. The nature of the job of route managers is given in a four-page
pamphlet, prepared by the company, called “Route Manager Position Description,” the pertinent
parts of which read:

A. BASIC PURPOSE
A Manager achieves objectives through others.

As a Route Manager, your purpose is to meet the sales plan; and you achieve this objective
through the skillful MANAGEMENT OF YOUR JOB AND THE MANAGEMENT OF YOUR PEOPLE.
These then are your functions as Pepsi-Cola Route Manager. Within these functions — managing
your job and managing your people — you are accountable to your District Manager for the
execution and completion of various tasks and activities which will make it possible for you to
achieve your sales objectives.
Xxxx

Distinction is evident in the work of the route managers which sets them apart from
supervisors in general. Unlike supervisors who basically merely direct operating employees in line
with set tasks assigned to them, route managers are responsible for the success of the company’s
main line of business through management of their respective sales teams. Such management
necessarily involves the planning, direction, operation and evaluation of their individual teams and
areas which the work of supervisors does not entail.

The route managers cannot thus possibly be classified as mere supervisors because their
work does not only involve, but goes far beyond, the simple direction or supervision of operating
employees to accomplish objectives set by those above them.

While route managers do not appear to have the power to hire and fire people (the evidence
shows that they only “recommended” or “endorsed” the taking of disciplinary action against certain
employees), this is because thisis a function of the Human Resources or Personnel Department of
the company.

# 2: Constitutionality of Art. 245

Art.245 is the result of the amendment of the Labor Code in 1989 by R.A. No. 6715, otherwise
known as the Herrera-Veloso Law. Unlike the Industrial Peace Act or the provisions of the
Labor Code which it superseded, R.A. No. 6715 provides separate definitions of the terms
“managerial” and “supervisory employees,” as follows:

Art. 212. Definitions. . . .

(m) “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.

The distinction between top and middle managers, who set management policy, and front-
line supervisors, who are merely responsible for ensuring that such policies are carried out by the

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rank and file, is articulated in the present definition. 30 When read in relation to this definition in Art.
212(m), it will be seen that Art. 245 faithfully carries out the intent of the Constitutional Commission
in framing Art. III, §8 of the fundamental law.
*Framer’s Intent: MR. LERUM. My amendment is on Section 7, page 2, line 19, which is to insert
between the words “people” and “to” the following: WHETHER EMPLOYED BY THE STATE OR
PRIVATE ESTABLISHMENTS. In other words, the section will now read as follows: “The right of the
people WHETHER EMPLOYED BY THE STATE OR PRIVATE ESTABLISHMENTS to form
associations, unions, or societies for purposes not contrary to law shall not be abridged.”

Nor is the guarantee of organizational right in Art. III, §8 infringed by a ban against managerial
employees forming a union. The right guaranteed in Art. III, §8 is subject to the condition that its
exercise should be for purposes “not contrary to law.” In the case of Art. 245, there is a rational basis
for prohibiting managerial employees from forming or joining labor organizations.

PETITION is DISMISSED.

Test of Supervisory Status

Southern Philippines Federation of Labor vs Calleja, 172 SCRA 676

FACTS: On December 29, 1986, petitioner Southern Philippines Federation of Labor filed a petition
for certification election among the rank-and-file employees of private respondent Apex Mining
Company, Incorporated with the Department of Labor in Region XI, Davao City.

On February 6, 1987, Med-Arbiter Conrado O. Macasa, Sr. issued an Order calling for the holding
of the certification election on February 23, 1987 among the rank-and-file employees of APEX with
the following choices:

1. Southern Philippines Federation of Labor (SPFL)

2. Mindanao Miners Employees Union-Sandigan ng Manggagawang Pilipino (MMEU-Sandigan)
and
3. No union.

On February 9, 1987, a pre-election conference was conducted among the petitioner Union; private
respondent Union, MMEU-Sandigan; and APEX to settle details in the conduct of the election such
as the venue of the election and the list of employees qualified to vote in the election.

During the pre-election conference, the parties agreed to delete from the list of workers prepared
and submitted by APEX numbering One Thousand Seven Hundred Sixteen (1,716), the names of
nineteen (19) managerial employees and seventy-three probationary employees who were
statutorily disqualified from voting. Petitioner Union objected to the inclusion in said list of the
following: (1) employees occupying the positions of Supervisor I, II, and III; (2) employees under
confidential/special payrolls; and (3) employees who were not paying Union dues. The petitioner
Union contends that the aforementioned employees were disqualified from participating in the
certification election since the Supervisors were managerial employees while the last two were
disqualified by virtue of their non-membership in the Union and their exclusion from the benefits of
the collective bargaining agreement.

Hence, this petition

ISSUE: WON the public respondent committed grave abuse of discretion in allowing the 197
employees to vote in the certification election when, as alleged by the petitioner, they are disqualified
by express provision of law or under the existing collective bargaining agreement

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HELD:

"The test of `supervisory’ or `managerial status’ depends on whether a person possesses authority
to act in the interest of his employer in the matter specified in Article 212 (k) of the Labor Code and
Section 1 (m) of its Implementing Rules and whether such authority is not merely routinary or clerical
in nature, but requires the use of independent judgment. Thus, where such recommendatory powers
as in the case at bar, are subject to evaluation, review and final action by the department heads and
other higher executives of the company, the same, although present, are not effective and not an
exercise of independent judgment as required by law (National Warehousing Corp. v. CIR, 7 SCRA
602-603 [1963])."

SUPERVISORS BY THE NATURE OF THEIR JOB, NOT MANAGERIAL EMPLOYEES IN CASE

AT BAR. — The petitioner’s motion for reconsideration before the public respondent outlined the
job description of Supervisors.

In the category of Supervisory II, the "General Summary" provides: "GENERAL SUMMARY :
"Assists the Foreman in the effective dispatching/distribution of manpower and equipment to carry
out approved work." (p. 30, Rollo) while the first duty enumerated in the position of Supervisor III
states: "1. Executes and coordinates work plans emanating from his supervisors." (p. 32, Rollo)
Thus, it is clear from the above provisions that the functions of the questioned positions are not
managerial in nature because they only execute approved and established policies leaving little or
no discretion at all whether to implement the said policies or not. The respondent Director, therefore,
did not commit grave abuse of discretion in dismissing the petitioner’s appeal from the Med-Arbiter’s
Order to open and count the challenged ballots in denying the petitioner’s motion for reconsideration
and in certifying the respondent Union as the sole and exclusive bargaining representative of the
rank-and-file employees of respondent Apex.

Engineering Equipment, Inc., vs NLRC, 133 SCRA 752

FACTS: This is a petition for certiorari to set aside the resolutions of respondent National Labor
Relations Commission (NLRC) which affirmed the decision of the respondent Labor Arbiter declaring
the private respondent's dismissal illegal and directing his reinstatement to his former position with
full backwages.

Respondent Ricardo Pili was an employee of petitioner Engineering Equipment, Inc.

beginning December 11, 1973 until July 18, 1976 when his services were terminated. At that time,
he was assigned as foreman in the Central Bank building construction project of the petitioner at
Diliman, Quezon City. As a result of the termination of his services, Pili filed a complaint for illegal
dismissal against the petitioner before the Manila Labor Regional Office.

No amicable settlement could be reached at the conciliation level. hence the case docketed
as NLRC Case No. RB-IV-11874-77 entitled Ricardo Pili v. Engineering Equipment Inc. was certified
for compulsory arbitration and assigned to the respondent Labor Arbiter.

As earlier stated, the Labor Arbiter's decision was affirmed by the NLRC and a motion for
reconsideration was denied. Hence, the instance petition.

ISSUE:

HELD: It is the nature of an employee's functions and not the nomenclature or title given to his job
which determines whether he has rank-and-file or managerial status. Among the characteristics of

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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. (See National Waterworks and Sewerage Authority v. NWSA Consolidated Unions,
11 SCRA 766).

The petitioner has made out a satisfactory case as to why it did not seek prior clearance but limited
itself to making a belated report.

At any rate, the employer has a right to dismiss an employee whose continuance in the service is
inimical to the employer's interest, The law protects the rights of workers but it cannot authorize the
oppression or self-destruction of the employer. (Manila Trading and Supply Co. v. Philippine labor
Union, 71 Phil. 124; El Hogar Filipino Mutual Bldg. and loan Association, et al. v. Building Employees
Inc, et al., 107 Phil. 473; Philippine Airlines Inc. v. Philippine Air lines Employees Association, 57
SCRA 489). The step taken by the employer in this case was a measure of self-protection.

Under the facts of the case, we rule that the petitioner had valid grounds to terminate the services
of the private respondent. However, we also take into account some equities of the case. The
respondent had worked for almost three years with the petitioner. Top management should have
become aware of the problem earlier instead of awaiting an explosive situation where forty (40)
construction workers prepare a formal protest against their foreman and question his competence
and conduct. Considering the boundary line nature of the respondent's job — whether or not it is
managerial, it would have been more prudent for the firm, which has very competent counsel, to
have asked for a prior clearance. In the light of the foregoing, we hold that the private respondent is
entitled to full separation pay but not reinstatement with back wages.

WHEREFORE, the petition is hereby GRANTED. The decisions of the respondent National Labor
Relations Commission and the respondent Labor Arbiter are REVERSED and SET ASIDE. Our
restraining order dated January 6, 1982 is made PERMANENT. The petitioner is ordered to grant
full separation pay to the private respondent.

Confidential Employees

Metrolab Industries, Inc. vs Hon. Nieves Roldan-Confesor and Metro Drug Corp. Employees
Association, G.R. No. 108855, February 28, 1996; San Miguel Corp.

FACTS: Private respondent Metro Drug Corporation Employees Association-Federation of

Free Workers (hereinafter referred to as the Union) is a labor organization representing the rank
and file employees of petitioner Metrolab Industries, Inc. (hereinafter referred to as Metrolab/MII)
and also of Metro Drug, Inc.

The Collective Bargaining Agreement (CBA) between Metrolab and the Union expired. The
negotiations for a new CBA, however, ended in a deadlock.

The Union filed a notice of strike against Metrolab and Metro Drug Inc.

The parties failed to settle their dispute despite the conciliation efforts of the National
Conciliation and Mediation Board.

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SECRETARY OF LABOR Ruben D. Torres: issued an assumption order of jurisdiction over the
entire labor dispute at Metro Drug, Inc. - Metro Drug Distribution Division and Metrolab Industries
Inc.

SECRETARY OF LABOR: issued an order resolving all the disputed items in the CBA and ordered
the parties involved to execute a new CBA.

The Union filed a Motion for Reconsideration (MR).

During the pendency of the MR, Metrolab laid off 94 of its rank and file employees.

The Union filed a motion for a cease and desist order to enjoin Metrolab from implementing
the mass layoff, alleging that such act violated the prohibition against committing acts that would
exacerbate the dispute as specifically directed in the assumption order.

Metrolab contended that the layoff was temporary and in the exercise of its management
prerogative.

Thereafter, on various dates, Metrolab recalled some of the laid off workers on a temporary
basis due to availability of work in the production lines.

ACTING SEC. OF LABOR Nieves Confesor: a resolution declaring the layoff of Metrolabs 94 rank
and file workers illegal and ordered their reinstatement with full backwages.

After exhaustive negotiations, the parties entered into a new CBA. The execution, however, was
without prejudice to the outcome of the issues raised in the reconsideration and clarification motions
submitted for decision to the Secretary of Labor.

The Union filed a motion for execution. Metrolab opposed.

Hence, the present petition for certiorari with application for issuance of a Temporary Restraining
Order.

ISSUES:
1. Whether or not public respondent Labor Secretary committed grave abuse of discretion and
exceeded her jurisdiction in declaring the subject layoffs instituted by Metrolab illegal on
grounds that these unilateral actions aggravated the conflict between Metrolab and the Union
who were, then, locked in a stalemate in CBA negotiations.
2. Whether or not the Public Respondent Secretary of DOLE gravely abused her discretion in
including executive secretaries as part of the bargaining unit of the rank and file employees

RULING:
1. NO, because the Secretary of Labor is expressly given the power under the Labor Code to
assume jurisdiction and resolve labor disputes involving industries indispensable to national interest.
The disputed injunction is subsumed under this special grant of authority.

Art. 263 (g) of the Labor Code specifically provides that:

xxx xxx xxx
(g) When, in his opinion, there exists a labor dispute causing or likely to cause a strike or lockout in
an industry indispensable to the national interest, the Secretary of Labor and Employment may
assume jurisdiction over the dispute and decide it or certify the same to the Commission for
compulsory arbitration. Such assumption or certification shall have the effect of automatically

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enjoining the intended or impending strike or lockout as specified in the assumption or certification
order. If one has already taken place at the time of assumption or certification, all striking or locked
out employees shall immediately return to work and the employer shall immediately resume
operations and readmit all workers under the same terms and conditions prevailing before the strike
or lockout. The Secretary of Labor and Employment or the Commission may seek the assistance of
law enforcement agencies to ensure compliance with this provision as well as with such orders as
he may issue to enforce the same.

2. NO, because Article I (b) of the 1988-1990 CBA provides:

b)Close Shop. - All Qualified Employees must join the Association immediately upon regularization
as a condition for continued employment. This provision shall not apply to: (i) managerial employees
who are excluded from the scope of the bargaining unit; (ii) the auditors and executive secretaries
of senior executive officers, such as, the President, Executive Vice-President, Vice-President for
Finance, Head of Legal, Vice-President for Sales, who are excluded from membership in the
Association; and (iii) those employees who are referred to in Attachment I hereof, subject, however,
to the application of the provision of Article II, par. (b) hereof. Consequently, the above-specified
employees are not required to join the Association as a condition for their continued employment.
On the other hand, Attachment I provides:
Exclusion from the Scope of the Close Shop Provision
The following positions in the Bargaining Unit are not covered by the Close Shop provision of the
CBA (Article I, par. b):
1. Executive Secretaries of Vice-Presidents, or equivalent positions.
2. Executive Secretary of the Personnel Manager, or equivalent positions.
3. Executive Secretary of the Director for Corporate Planning, or equivalent positions.
4. Some personnel in the Personnel Department, EDP Staff at Head Office, Payroll Staff at Head
Office, Accounting Department at Head Office, and Budget Staff, who because of the nature of their
duties and responsibilities need not join the Association as a condition for their employment.
5. Newly-hired secretaries of Branch Managers and Regional Managers.

Both Metro Drug and Metrolab read the exclusion of managerial employees and executive
secretaries as exclusion from the bargaining unit. They point out that managerial employees are
lumped under one classification with executive secretaries, so that since the former are excluded
from the bargaining unit, so must the latter be likewise excluded.

The exclusion of managerial employees, in accordance with law, must therefore still carry the
qualifying phrase from the bargaining unit in Article I (b)(i) of the 1988-1990 CBA. In the same
manner, the exclusion of executive secretaries should be read together with the qualifying phrase
are excluded from membership in the Association of the same Article and with the heading of
Attachment I. The latter refers to Exclusions from Scope of Close Shop Provision and provides that
[t]he following positions in Bargaining Unit are not covered by the close shop provision of the CBA.
The basis for the questioned exclusions, it should be noted, is no other than the previous CBA
between Metrolab and the Union. If Metrolab had undergone an organizational restructuring since
then, this is a fact to which we have never been made privy. In any event, had this been otherwise
the result would have been the same. To repeat, we limited the exclusions to recognize the
expanded scope of the right to self-organization as embodied in the Constitution.

The Court concurs with Metrolab contention that executive secretaries of the General
Manager and the executive secretaries of the Quality Assurance Manager, Product Development
Manager, Finance Director, Management System Manager, Human Resources Manager, Marketing
Director, Engineering Manager, Materials Manager and Production Manager, who are all members
of the company’s Management Committee should not only be exempted from the closed-shop
provision but should be excluded from membership in the bargaining unit of the rank and file

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employees as well on grounds that their executive secretaries are confidential employees, having
access to vital labor information.

Confidential employees cannot be classified as rank and file. The nature of employment of
confidential employees is quite distinct from the rank and file, thus, warranting a separate category.
Excluding confidential employees from the rank and file bargaining unit, therefore, is not tantamount
to discrimination.

DISPOSITIVE: Metrolab Industries Inc. partially won. The executive secretaries of petitioner
Metrolabs General Manager and the executive secretaries of the members of its Management
Committee are excluded from the bargaining unit of petitioners rank and file employees.

DOCTRINE: 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.

Supervisors and Exempt Union vs Hon. Laguesma et al., G.R. No. 110399, August 15, 1997

FACTS: Petitioner union filed before DOLE a Petition for Direct Certification or Certification Election
among the supervisors and exempt employees of the SMC Magnolia Poultry Products Plants of
Cabuyao, San Fernando and Otis.

Med-Arbiter Danilo L. Reynante issued an Order ordering the conduct of certification election
among the abovementioned employees of the different plants as one bargaining unit.

San Miguel Corporation filed a Notice of Appeal with Memorandum on 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.

The public respondent, Undersecretary 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.

Upon petitioner-union’s motion, Undersecretary Laguesma granted the reconsideration

prayed for and directed the conduct of separate certification elections among the supervisors ranked
as supervisory levels 1 to 4 (S1 to S4) and the exempt employees in each of the three plants at
Cabuyao, San Fernando and Otis.

ISSUE:
1. Whether Supervisory employees 3 and 4 and the exempt employees of the company are
considered confidential employees, hence ineligible from joining a union.

2. If they are not confidential employees, do the employees of the three plants constitute an
appropriate single bargaining unit.

RULING:

(1) On the first issue, this Court rules that said employees do not fall within the term “confidential
employees” who may be prohibited from joining a union.

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 They are not qualified to be classified as managerial employees who, under Article 245 of the
Labor Code, are not eligible to join, assist or form any labor organization. In the very same provision,
they are not allowed membership in a labor organization of the rank-and-file employees but may
join, assist or form separate labor organizations of their own.

Confidential employees are those who (1) assist or act in a confidential capacity, (2) to
persons who formulate, determine, and effectuate management policies in the field of labor
relations. The two criteria are cumulative, and both must be met if an employee is to be considered
a confidential employee — that is, the confidential relationship must exist between the employee
and his supervisor, and the supervisor must handle the prescribed responsibilities relating to labor
relations.

The exclusion from bargaining units of employees who, in the normal course of their duties,
become aware of management policies relating to labor relations is a principal objective sought to
be accomplished by the ”confidential employee rule.” The broad rationale behind this rule is that
employees should not be placed in a position involving a potential conflict of interests. “Management
should not be required to handle labor relations matters through employees who are represented
by the union with which the company is required to deal and who in the normal performance of their
duties may obtain advance information of the company’s position with regard to contract
negotiations, the disposition of grievances, or other labor relations matters.”

The Court held that “if these managerial employees would belong to or be affiliated with a
Union, the latter might not be assured of their loyalty to the Union in view of evident conflict of
interest. The Union can also become company-dominated with the presence of managerial
employees in Union membership.”

An important element of the “confidential employee rule” is the employee’s need to use labor
relations information. Thus, in determining the confidentiality of certain employees, a key question
frequently considered is the employee’s necessary access to confidential labor relations information.

(2) 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.

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.”

A unit to be appropriate must effect a grouping of employees who have substantial, mutual
interests in wages, hours, working conditions and other subjects of collective bargaining.

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