Labor Relations (Azucena Vol. II) Finals
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Title V COVERAGE Article 243. Coverage and employees’ right to self-organization. – All persons employed in commercial, industrial and agricultural enterprises and in religious, charitable, medical, or educational institutions, whether operating for profit or not, shall have the right to self-organization and to form, join, or assist labor organizations of their own choosing for purposes of collective bargaining. Ambulant, intermittent and itinerant workers, self-employed people, rural workers and those without any definite employers may form labor organizations for their mutual aid and protection. (As amended by Batas Pambansa Bilang 70, May 1, 1980). ________ 1. ORGANIZING IN GENERAL The rights to organize and to bargain, in a general sense, are given not exclusively to employees. Even workers who are not employees of any particular employer may form their organizations to protect their interests. Under Art. 243 of this Code, the right to organize refers also to forming, joining or assisting a labor organization. Connected to Art. 246 this right carries with it the right to engage in group action, provided it is peaceful, to support the organization’s objective which is not necessarily bargaining but, simply, to aid and protect its members. But this kind of group action must be differentiated from strike which, because it is work stoppage, must observe certain regulation; otherwise, the strike may be declared illegal and its leaders may be thrown out of their jobs.
LABOR RELATIONS form any labor organization. Therefore, regardless of the challenged employees' designations, whether they are employed as Supervisors or in the confidential payrolls, if the nature of their job does not fall under the definition of "managerial" as defined in the Labor Code, they are eligible to be members of the bargaining unit and to vote in the certification election. Their right to self-organization must be upheld in the absence of an express provision of law to the contrary. It cannot be curtailed by a collective bargaining agreement. 3. EMPLOYEES OF NONPROFIT INSTITUTIONS Under Article 243 of the Labor Code, the rank-and-file employees of non-profit medical institutions are permitted to form, organize or join labor unions of their choice for purposes of collective bargaining. If the union has complied with the requisites provided by law for calling a certification election, it is incumbent upon the DOLE Regional Director to conduct such certification election to ascertain the bargaining representative of the hospital employees. 4. EXCEPTION: COOPERATIVE
A cooperative is by its nature different from an ordinary business concern being run either, by persons, partnerships or corporations. Its owners and/or members are the ones who run and operate the business while the others are its employees. As above stated, irrespective of the name of shares owned by its members they are entitled to cast one vote each in deciding upon the affair of the cooperative. Their share capital earn limited interests. They enjoy special privileges as exemption from income tax and sales taxes, preferential right to supply their products to State agencies and even exemption from minimum wage laws.
1.1 Coverage of the Right to Organize; Exceptions The right to form, join or assist a labor organization is granted to all kinds of employees of all kinds of employers—public or private, profit or non-profit, commercial or religious. Their usual form of organization is a union and the usual purpose is collective bargaining with their employers. But the seemingly all-inclusive coverage of “all persons” in Article 243 actually admits exceptions. Under Art. 245, for instance, managerial employees, regardless of the kind of organization where they are employed, may not join, assist or form any labor organization, meaning a labor union. Accordingly, managerial employees cannot, in the absence of an agreement to the contrary, be allowed to share in the concessions obtained by the labor union through collective negotiation. Otherwise, they would be exposed to the temptation of colluding with the union during the negotiations to the detriment of the employer. However, there is nothing to prevent the employer from granting benefits to managerial employees equal to or higher than those afforded to union members. Supervisors are allowed to organize, but they cannot for, join or assist a rank-and-file union. 2. RIGHT TO ORGANIZE CANNOT BE BARGAINED AWAY Although we have upheld the validity of the CBA as the law among the parties, its provisions cannot override what is expressly provided by law that only managerial employees are ineligible to join, assist or
An employee of such a cooperative who is a member and co-owner thereof cannot invoke the right to collective bargaining for certainly an owner cannot bargain with himself or his co-owners. However, in so far as it involves cooperatives with employees who are not members or co-owners thereof, certainly such employees are entitled to exercise the rights of all workers to organization, collective bargaining, negotiations and others as are enshrined in the Constitution and existing laws of the country. In another case, the court clarified that it is the fact of ownership of the cooperative, and not involvement in the management thereof, which disqualifies a member from joining any labor organization within the cooperative. Thus, irrespective of the degree of their participation in the actual management of the cooperative, all members thereof cannot form, assist or join a labor organization for the purpose of collective bargaining. But member-employees of a cooperative may withdraw as members of the cooperative in order to join a labor union. Membership in a cooperative is voluntary; inherent in it is the right not to join. 4.1 Exception to Exception: Association, not Union While the members of a cooperative who are also its employees cannot unionize for bargaining purposes, the law does not prohibit them from forming an association for their mutual aid and protection as employees.
LABOR RELATIONS D.O. No. 40-03 allows and defines a “workers’ association” as one which is organized for the mutual aid and protection of its members or for any legitimate purpose other than collective bargaining.
Waiver of its immunity is discretionary to IRRI. Without such express waiver the NLRC or its labor arbiters have no jurisdiction over IRRI even in cases of alleged illegal dismissal of any of its employees.
5. EXCEPTION: INTERNATIONAL ORGANIZATIONS 5.2 Foreign Workers A certification election cannot be conducted in an international organization which the Philippine Government has granted immunity from local jurisdiction. The grant of such immunity is a political question whose resolution by the executive branch of government is conclusive upon the courts (1) “International Organization” and “Specialized Agencies”—The term "international organization" is generally used to describe an organization set up by agreement between two or more states. Under contemporary international law, such organizations are endowed with some degree of international legal personality such that they are capable of exercising specific rights, duties and powers. They are organized mainly as a means for conducting general international business in which the member states have an interest. The United Nations, for instance, is an international organization dedicated to the propagation of world peace. "Specialized agencies" are international organizations having functions in particular fields. The term appears in Articles 57 and 63 of the Charter of the United Nations. (2) Principles Underlying the Grant of International Immunities to International Organizations—There are basically three propositions underlying the grant of international immunities to international organizations. These principles, contained in the ILO Memorandum are stated thus: 1) international institutions should have a status which protects them against control or interference by any one government in the performance of functions for the effective discharge of which they are responsible to democratically constituted international bodies in which all the nations concerned are represented; 2) no country should derive any national financial advantage by levying fiscal charges on common international funds; and 3) the international organization should, as a collectivity of States members, be accorded the facilities for the conduct of its official business customarily extended to each other by its individual member States. The theory behind all three propositions is said to be essentially institutional in character. "It is not concerned with the status, dignity or privileges of individuals, but with the elements of functional independence necessary to free international institutions from national control and to enable them to discharge their responsibilities impartially on behalf of all their members. The raison d'etre for these immunities is the assurance of unimpeded performance of their functions by the agencies concerned. (3) Labor’s Basic Rights Remain—The immunity of International Catholic Migration Commission (ICMC) and the International Rice Research Institution (IRRI) from local jurisdiction by no means deprives labor of its basic rights, which are guaranteed by Article II, Section 18, Article III, Section 8, and Article XIII, Section 3, of the 1987 Constitution; and implemented by Articles 243 and 246 of the Labor Code. (4) Certification Election Barred by Immunity—The immunity granted being "from every form of legal process except in so far as in any particular case they have expressly waived their immunity," it is inaccurate to state that a certification election is beyond the scope of that immunity for the reason that it is not a suit against ICMC. A certification election cannot be viewed as an independent or isolated process. It could trigger off a series of events in the collective bargaining process together with related incidents and/or concerted activities, which could inevitably involve ICMC in the "legal process," which includes “any penal, civil and administrative proceedings.” The eventuality of Court litigation is neither remote and from which international organizations are precisely shielded to safeguard them from the disruption of their functions. Clauses on jurisdictional immunity are said to be standard provisions in the constitutions of international Organizations. “The immunity covers the organization concerned, its property and its assets...”
5.1 Waiver of Immunity
Foreigners, whether natural or juridical, as well as foreign corporations are strictly prohibited from engaging directly or indirectly in all forms of trade union activities. However, aliens working in the country with valid work permits may exercise the right to self-organization if they are nationals of a country that grants the same or similar rights to Filipino workers. (Art. 269)
6. EXCEPTION: RELIGIOUS OBJECTORS; IGLESIA NI CRISTO MEMBERS Under the Industrial Peace Act (1953) which preceded the Labor Code (and even under the present Code) the employer and the union could enter into a “closed shop” agreement which would compel employees to become union workers as a condition of continued employment. But in 1961 R.A. No. 3350 was passed to exempt from such compulsory union membership the followers of any religious sect (such as the Iglesia ni Cristo) whose teachings forbid membership in labor unions. The constitutionality of R.A. No. 3350 was upheld by the Supreme Court in Victoriano v. Elizalde. It may not be amiss to point out here 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. 6.1 Does the Exemption Still Stand? 6.2 Iglesia Ni Cristo Members May Form and Join Own Union ________ Article 244. Right of employees in the public service. – Employees of government corporations established under the Corporation Code shall have the right to organize and to bargain collectively with their respective employers. All other employees in the civil service shall have the right to form associations for purposes not contrary to law. (As amended by Executive Order No. 111, December 24, 1986). ________ 1. GOVERNMENT EMPLOYEES’ RIGHT TO ORGANIZE; LIMITATIONS The highest law of the land guarantees to government employees the right to organize and to negotiate, but not the right to strike. 1.1 Limited Purpose The extent of the government employees' right of self-organization differs significantly from that of employees in the private sector. The latter's right of self-organization, i.e., "to form, join or assist labor organizations for purposes of collective bargaining," admittedly includes the right to deal and negotiate with their respective employers in order to fix the terms and conditions of employment and also, to engage in concerted activities for the attainment of their objectives, such as strikes, picketing, boycotts. But the right of government employees to "form, join or assist employees organizations of their own choosing" under Executive Order No. 180 is not regarded as existing or available for "purposes of collective
LABOR RELATIONS bargaining," but simply "for the furtherance and protection of their interests." In other words, the right of Government employees to deal and negotiate with their respective employers is not quite as extensive as that of private employees. Excluded from negotiation by government employees are the "terms and conditions of employment...that are fixed by law," it being only those terms and conditions not otherwise fixed by law that "may be subject of negotiation between the duly recognized employees' organizations and appropriate government authorities." Declared to be 'not negotiable' are matters "that require appropriation of funds;" e.g., increase in salary emoluments and other allowances, car plan, special hospitalization, medical and dental services, increase in retirement benefits (Sec. 3, Rule VIII), and those "that involve the exercise of management prerogatives;" e.g., appointment, promotion, assignment/detail, penalties as a result of disciplinary actions, etc. (Sec. 4, Id.) Considered negotiable are such matters as schedule of vacation and other leaves, work assignment of pregnant women; recreational, social, athletic, and cultural activities and facilities, etc. (Sec. 2, Id.).
1.2 No Signing Bonus Employees and officers of SSS are not entitled to the signing bonus provided for in the collective negotiation agreement because the process of collective negotiations in the public sector does not encompass terms and conditions of employment requiring the appropriation of public funds. The Court reminds the Social Security Commission officials that the SSS fund is not their money 1.3 Excepted Employees Excepted from the application of Executive Order 180, however, are “members of the Armed Forces of the Philippines, including police officers, policemen, firemen, and jail guards” (Sec. 4). For reasons of security and safety, they are not allowed to unionize. A “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, lay-off, recall, dismiss, assign or discipline employees. 1.3a Professors as rank-and-file employees Professors at the University of the Philippines who are not exercising managerial or highly confidential functions are rank-and-file employees and may unionize separately from the non-academic personnel. In short, the professors, associate professors and assistant professors of the University of the Philippines are rank-and-file employees. The full professors, associate professors, assistant professors, instructors and the research, extension and professional staff may, if so minded, organize themselves into a separate collective bargaining unit. 1.4 Right to Strike EO No. 180 also concedes to government employees, like their counterparts in the private sector, the right to engage in concerted activities, including the right to strike, the executive order is quick to add that those activities must be
exercised in accordance with law, i.e. are subject both to "Civil Service Law and rules" and "any legislation that may be enacted by Congress," that "the resolution of complaints, grievances and cases involving government employees" is not ordinarily left to collective bargaining or other related concerted activities, but to "Civil Service Law and labor laws and procedures whenever applicable;" and that in case "any dispute remains unresolved after exhausting all available remedies under existing laws and procedures, the parties may jointly refer the dispute to the (Public Sector Labor-Management) Council for appropriate action." What is more, the Rules and Regulations implementing Executive Order No. 180 explicitly provide that since the "terms and conditions of employment in the government, including any political subdivision or instrumentality thereof and government-owned and controlled corporations with original charters are governed by law, the employees therein shall not strike for the purpose of securing changes thereof.
2. REGISTRATION Sec. 7. Government employees' organizations shall register with the Civil Service Commission and the Department of Labor and Employment. The application shall be filed with the Bureau of Labor Relations of the Department which shall process the same in accordance with the provisions of the Labor Code of the Philippines, as amended. Applications may also be filed with the Regional Offices of the Department of Labor and Employment which shall immediately transmit the said applications to the Bureau of Labor Relations within three (3) days from receipt thereof. Sec. 8. Upon approval of the application, a registration certificate be issued to the organization recognizing it as a legitimate employees' organization with the right to represent its members and undertake activities to further and defend its interest. The corresponding certificates of registration shall be jointly approved by the Chairman of the Civil Service Commission and Secretary of Labor and Employment. (E.O. No. 180)
3. CERTIFICATION CORPORATION
A certification election to choose the union that will represent the employees may be conducted by the Bureau of Labor Relations in a government corporation, whether governed by the Labor Code or the Civil Service rules. 3.1 Election of Officers in Government Unions It is quite clear from this provision that BLR has the original and exclusive jurisdiction on all inter-union and intra-union conflicts. An intra-union conflict would refer to a conflict within or inside a labor union, and an inter-union controversy or dispute, one occurring or carried on between or among unions. The subject of the case at bar, which is the election of the officers and members of the board of KMKK-MWSS, is, clearly, an intra-union conflict, being within or inside a labor union. It is well within the powers of the BLR to act upon. 4. WHEN PSLMC MAY RULE ON LEGALITY OF DISMISSAL The Public Sector Labor-Management Council, created by Executive Order No. 180 (June 1, 1987) has jurisdiction to hear charges of unfair labor practice filed by government employees against their employer, e.g., the Pamantasan ng Lungsod ng Maynila. In deciding the ULP charge the PSLMC may also rule on the complainants’ dismissal if the two issues—ULP and dismissal—are unavoidably interlinked. 5. UNION-BUSTING IN A GOVERNMENT AGENCY, U.L.P. 5.1 Even Temporary Employees May Organize
LABOR RELATIONS Even temporary employees enjoy the basic right to form organization or association for purposes not contrary to law. Under Art. 277(c) of the Labor Code, “any employee, whether employed for a definite period of not, shall beginning on his first day of service, be considered an employee for purposes of membership in any labor union.” ________ Article 245. Ineligibility of managerial employees to join any labor organization; Right of Supervisory Employees. - Managerial employees are not eligible to join, assist or form any labor organization. Supervisory employees shall not be eligible for membership in the collective bargaining unit of the rank-and-file employees but may join, assist or form separate collective bargaining units and/or legitimate labor organizations of their own. The rank-andfile union and the supervisors’ union operating within the same establishment may join the same federation or national union. (As amended by Section 18, Republic Act No. 6715, March 21, 1989 and Section 8, Republic Act No. 9481 which lapsed into law on May 25, 2007 and became effective on June 14, 2007). ________ 1. CATEGORIES OF EMPLOYEES RA 6715 which took effect on March 21, 1989 (15 days after its publication in the "Philippines Daily Inquirer") provides that although "supervisory employees shall not be eligible for membership in a labor organization of the rank and file employees," they may, however, "join, assist or form separate labor organization of their own." 2. INELIGIBILITY OF MANAGERS 2.1 Types of Managerial Employees The term "manager" generally refers to "anyone who is responsible for subordinates and other organizational resources." As a class, managers constitute three levels of a pyramid, namely, top management, middle management, and first-line management which is also called supervisor. Below this third level are the operatives or operating employees who, we may add, are also called rank-and-file. FIRST-LINE MANAGERS — The lowest level in an organization at which individuals are responsible for the work of others is called first-line or firstlevel 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.
As can be seen from this description, 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. Whether they belong to the first or the second category, managers, vis-a-vis employers, are, likewise, employees.
2.2 Constitutionality of the Prohibition The question is whether the first sentence of Art. 245 of the Labor Code, prohibiting managerial employees from forming, assisting or joining any labor organization, is constitutional in light of Art. III, Sec. 8 of the Constitution which provides: The right of the people, including those employed in the public and private sectors, to form unions, association, or societies for purposes not contrary to law shall not be abridged.
The present Article 245 is the result of the amendment of the Labor Code in 1989 by R.A. No. 6715, otherwise known as the HerreraVeloso 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" (See Art. 212[m]). Although the definition of "supervisory employees" seems to have been unduly restricted to the last phrase of the definition in the Industrial Peace Act, the legal significance given to the phrase "effectively recommends" remains the same. In fact, the distinction between top and middle managers, who set management policy, and front-line supervisors, who are merely responsible for ensuring that such policies are carried out by the rank and file, is articulated in the present definition. The rationale for this inhibition has been stated to be, because if these managerial employees would belong to or be affiliated with a Union, the latter might not be assured of their loyalty to the Union in view of evident conflict of interests. The Union can also become company-dominated with the presence of managerial employees in Union membership.
2.2a Other Opinions Justice Puno further airs a warning: “To declare Article 245 of the Labor Code unconstitutional cuts deep into our existing industrial life and will open the floodgates to unionization at all levels of the industrial hierarchy. Such a ruling will wreak havoc on the existing set-up between management and labor. If all managerial employees will be allowed to unionize, then all who are in the payroll of the company, starting from the president, vice-president, general managers and everyone, with the exception of the directors, may go on strike or picket the employer. Company officers will join forces with the supervisors and rank-and-file.”
3. EVOLUTION OF SUPERVISORS’ RIGHT TO ORGANIZE Unlike managers, supervisors can unionize. 3.1 First Period: Under the Industrial Peace Act
LABOR RELATIONS The problem was that although the Industrial Peace Act defined a “supervisor,” it failed to define a “manager” or “managerial employee.” So the question arose: Did the word “supervisor” include “manager”? Could managers also unionize? In a case involving Caltex managers, the Court answered affirmatively. 3.2 Second Period: Under the Labor Code Before Amendment by R.A. No. 6715 This time the question was: Did ‘managerial employee” include “supervisor”? Were supervisors also banned from unionizing? Yes. The prohibition was applied to supervisors in the case of Bulletin Publishing Corp. V. Sanchez, 144 SCRA 428, decided on October 7, 1986. 3.3 Third Period: Under the Labor Code as Amended by RA 6715 R.A. No. 6715 presents a compromise formula: retain the ineligibility of managerial employees but revive the right of supervisory employees to unionize. 4. DEFINITION OF MANAGER AND SUPERVISOR Unlike in the Industrial Peace Act and the Labor Code before such amendment, the power to decide on managerial acts is now separated from the power to recommend those managerial acts, such as laying down policy, hiring or dismissing employees, etc. A supervisor has the power only to recommend while a managerial employee has the power to decide and do those acts. But to make one a supervisor, the power to recommend must not be merely routinary or clerical in nature but requires the use of independent judgment. In other words, the recommendation is (1) discretionary or judgmental (not clerical), (2) independent (not a dictation of someone else), and (3) effective (given particular weight in making the management decision). If these qualities are lacking or, worse, if the power to recommend is absent, then the person is not really a supervisor but a rank-and-file employee and therefore belongs or should belong to a rank-and-file organization. Similarly, a so-called manager, no matter how his position is titled, is not really a manager in the eyes of the law if he does not possess managerial powers (to lay down and execute management policies and/ or to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline employees). If he can only recommend the exercise of any of these powers, he is only a supervisor, hence, may join, assist or form a supervisors’ organization. 5. TEST OF SUPERVISORY STATUS 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. 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 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.
5.1 The Power to Recommend The power to recommend, in order to qualify an employee as a supervisor, must not only be effective but should require the use of independent judgment. It should not be merely of a routinary or clerical nature. 5.2 Examples of Ineffective or Clerical Recommendation 6. SEGREGATION OF RANK-AND-FILE AND SUPERVISORS Article 245 allows supervisory employees to form, join, or assist separate labor organizations of their own, but they are not eligible for membership in a labor organization of the rank-and-file employees. Neither may a rank-and-file join a union of supervisors. This policy of segregating the supervisors’ union from that of the rank-and-file is founded on fairness to the employees themselves. It will be doubly detrimental to the employer if the supervisors and the rank-and-file, as members of only one union, could take a common stand against the employer. 6.1 Effects of Having Mixed Membership A union whose membership is a mixture of supervisors and rank-andfile is not and cannot become a legitimate labor organization. It cannot petition for a certification election, much less ask to be recognized as the bargaining representative of employees. The Labor Code has made it a clear statutory policy to prevent supervisory employees from joining labor organizations consisting of rank-and-file employees as the concerns which involve members of either group are normally disparate and contradictory. Clearly, based on Article 245, a labor organization composed of both rank-andfile 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. The rationale behind the Code's exclusion of supervisors from unions of rankand-file employees is that such employees, while in the performance of supervisory functions, become the alter ego of management in the making and the implementing of key decisions at the sub-managerial level. Certainly, it would be difficult to find unity or mutuality of interests in a bargaining unit consisting of a mixture of rank-and-file and supervisory employees. And this is so because the fundamental test of a bargaining unit's acceptability is whether or not such a unit will best advance to all employees within the unit the proper exercise of their collective bargaining rights. The Code itself has recognized this, in preventing supervisory employees from joining unions of rank-and-file employees.
LABOR RELATIONS 6.2 How Many? How Few?
7.3 Third Swing: Inclusion Among Supervisors
6.3 Illegal Mixed Membership Must Be Raised and Proved
7.4 Fourth Swing: Inclusion Among Monthly Paid Rank-and-File
6.4 Cancellation of Union Registration on Ground of Inclusion of Disqualified Positions: What needs to be Proved
7.4a Limited Exclusion; Doctrine of Necessary Implication
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.
The implementing Rules state that the legal personality of the petitioner union cannot be subject to collateral attack “but may be questioned only in an independent petition for cancellation.” To summarize, the petition for certification election is not the proper forum to raise the issue of legal personality of the union. Also, a petition to cancel union registration cannot be heard or decided by the Med-Arbiter but either the DOLE Regional Director for enterpriselevel or the BLR Director for national unions. 6.5 Affiliation of Supervisors and Rank-and-File Unions Even in affiliating with a federation, the unions of the supervisors and of the ran-and-file should be segregated. The peculiar role of supervisors is such that while they are not managers, when they recommend action implementing management policy or ask for the discipline or dismissal of subordinates, they identify with the interests of the employer and may act contrary to the interests of the rank-and-file. We agree with the petitioner's contention that a conflict of interest may arise in the areas of discipline, collective bargaining and strikes. Members of the supervisory union might refuse to carry out disciplinary measures against their co-member rank-and-file employees. In the area of bargaining, their interests cannot be considered identical. The needs of one are different from those of the other. Moreover, in the event of a strike, the national federation might influence the supervisors' union to conduct a sympathy strike on the sole basis of affiliation. Thus, 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.
6.6 Restriction in Affiliation Clarified in De La Salle First, the rank-and-file employees are directly under the authority of the supervisory employees. Second, the national federation is actively involved in union activities in the company. If these two conditions are absent, the rule prohibiting supervisors from affiliating with the mother union of the rank-and-file union does not apply. The affiliation of two local unions in a company with the same national federation is not by itself a negate-on 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.
7. CONFIDENTIAL EMPLOYEES 7.1 First Swing: Inclusion Among Rank-and-File 7.2 Second Swing: Exclusion from 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 employees as ineligible to join, assist or form any labor organization, under the doctrine of necessary implication, confidential employees are similarly disqualified. The doctrine of necessary implication means that what is implied in a statute is as much a part thereof as that which is expressed. 7.4b The Metrolab and Meralco Summations: Exclusion from Bargaining unit and Closed-shop Clause 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.
7.4c Who Are Confidential Employees? Confidential employees assist and act in a confidential capacity to, or have access to confidential matters of, persons who exercise managerial functions in the field of labor relations. As such, the rationale behind the ineligibility of managerial employees to form, assist or join a labor union equally applies to them. Confidential employees are 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. By the very nature of their functions, they assist and act in a confidential capacity to, or have access to confidential matters of, persons who exercise managerial functions in the field of labor relations. 7.4d The Labor Nexus 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."
Art. 245 of the Labor Code does not directly prohibit confidential employees from engaging in union activities. However, under the doctrine of necessary implication, the disqualification of managerial employees equally applies to confidential employees. The confidential-employee rule justifies exclusion of confidential employees because in the normal course of their duties they become aware of management policies relating to labor relations. It must be stressed, however, that when the employee does not have access to confidential labor relations information, there is no legal prohibition
against confidential employees from forming, assisting, or joining a union. 7.4e New CBA may include employees excluded from old CBA; Expired CBA may be Modified, not just Renewed The employer and the union in an enterprise may negotiate and agree whom to cover in their CBA. And they are free to change their agreement: people excluded before may be included now, or vice versa.
LABOR RELATIONS abridged in the workplace, the abridgment is termed ULP (unfair labor practice). Article 246, is both (in mixed metaphors), the conceptual mother and the formidable fortress of the prohibition expounded in the next three articles. ________ Title VI UNFAIR LABOR PRACTICES
8. SECURITY GUARDS MAY JOIN RANK-AND-FILE OR SUPERVISORS UNION
Chapter I CONCEPT
Under the old rules, security guards were barred from joining a labor organization of the rank-and-file. Under RA 6715, they may now freely join a labor organization of the rank-and-file or that of the supervisory union, depending on their rank. ________
Article 247. Concept of unfair labor practice and procedure for prosecution thereof. – Unfair labor practices violate the constitutional right of workers and employees to self-organization, are inimical to the legitimate interests of both labor and management, including their right to bargain collectively and otherwise deal with each other in an atmosphere of freedom and mutual respect, disrupt industrial peace and hinder the promotion of healthy and stable labor-management relations.
Article 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. (Introduced as new provision by Section 9, Republic Act No. 9481 which lapsed into law on May 25, 2007 and became effective on June 14, 2007). ________ Article 246. Non-abridgment of right to self-organization. – It shall be unlawful for any person to restrain, coerce, discriminate against or unduly interfere with employees and workers in their exercise of the right to self-organization. Such right shall include the right to form, join, or assist labor organizations for the purpose of collective bargaining through representatives of their own choosing and to engage in lawful concerted activities for the same purpose or for their mutual aid and protection, subject to the provisions of Article 264 of this Code. (As amended by Batas Pambansa Bilang 70, May 1, 1980). ________
Consequently, unfair labor practices are not only violations of the civil rights of both labor and management but are also criminal offenses against the State which shall be subject to prosecution and punishment as herein provided. Subject to the exercise by the President or by the Secretary of Labor and Employment of the powers vested in them by Articles 263 and 264 of this Code, the civil aspects of all cases involving unfair labor practices, which may include claims for actual, moral, exemplary and other forms of damages, attorney’s fees and other affirmative relief, shall be under the jurisdiction of the Labor Arbiters. The Labor Arbiters shall give utmost priority to the hearing and resolution of all cases involving unfair labor practices. They shall resolve such cases within thirty (30) calendar days from the time they are submitted for decision. Recovery of civil liability in the administrative proceedings shall bar recovery under the Civil Code.
1. CONCEPT OF THE RIGHT TO SELF ORGANIZATION This is a key article that offers an inclusionary definition of the right to self-organization (S.O.) by saying not what it is but what it includes. It includes at least two rights: (1) the right to form, join or assist labor organizations, and (2) the right to engage in lawful concerted activities. The “labor organization” may be a union or association of employees, as mentioned in Article 212(g). Its purposes may be collective bargaining (as stated in this Article) or dealing with the employer [as stated in Article 212(g)]. The right to form labor organization is twin to the right to engage in concerted activities. It is worth noting, finally, that the right to self-organization is granted not only to employees but to “workers,” whether employed or not. In fact, constitutionally speaking, the right to form associations or societies is a right of the “people,” whether workers or not. No “person”—inside or outside of government, employer or nonemployer, unionist or non-unionist—may abridge these rights. If
No criminal prosecution under this Title may be instituted without a final judgment finding that an unfair labor practice was committed, having been first obtained in the preceding paragraph. During the pendency of such administrative proceeding, the running of the period of prescription of the criminal offense herein penalized shall be considered interrupted: Provided, however, that the final judgment in the administrative proceedings shall not be binding in the criminal case nor be considered as evidence of guilt but merely as proof of compliance of the requirements therein set forth. (As amended by Batas Pambansa Bilang 70, May 1, 1980 and later further amended by Section 19, Republic Act No. 6715, March 21, 1989). ________ 1. CONCEPT OF UNFAIR LABOR PRACTICE As noted at the start of Book V a major aim of labor relations policy is industrial democracy whose realization is most felt in free collective bargaining or negotiation over terms and conditions of employment. But for bargaining negotiation to be true and meaningful, the employees, first of all, must organize themselves. Because selforganization is a prerequisite—the lifeblood—of industrial
LABOR RELATIONS democracy, the right to self-organize has been enshrined in the Constitution, and any act intended to weaken or defeat the right is regarded by law as an offense. The offense is technically called “unfair labor practice” (ULP). Literally, it does not mean an unfair practice by labor but a practice unfair to labor, although the offender may either be an employer or a labor organization. The victim of the offense is not just the workers as a body and the well-meaning employers who value industrial peace, but the State as well. Thus, the attack to this constitutional right is considered a crime which therefore carries both civil and criminal liabilities. A consideration of the entire law on the matter clearly discloses the intention of the lawmaker to consider acts which are alleged to constitute unfair labor practices as violations of the law or offenses, to be prosecuted in the same manner as a criminal offense. The reason for this provision is that the commission of an unfair labor practice is an offense against a public right or interest and should be prosecuted in the same manner as a public offense. The reason for the distinction between an unfair labor practice case and a mere violation of an employer of its contractual obligation towards an employees is, x x x that unfair labor practice cases involve violations of a public right or policy, to be prosecuted like criminal offenses whereas a breach of an obligation of the employer to his employee is only a contractual breach to be redressed like an ordinary contract or obligation.
1.1 Elements Commission of unfair labor practice at the enterprise level needs the presence of certain elements: first, there is employer-employee relationship between the offender and the offended; and second, the act done is expressly defined in the Code as an act of unfair labor practice. The first element is required because ULP is negation of, a counteraction to, the right to organize which is available only to employees in relation to their employer. No organizational right can be negated or assailed if employer-employee relationship is absent in the first place. The second element is that the act done is prohibited by the Code, specifically in Articles 248 and 261 for an employer and Article 249 for a labor organization. Art. 212(k) emphatically defines “unfair labor practice” as “any unfair labor practice as expressly defined in this Code.” Art. 261 amplifies Art. 248(i) by stating that violation of a CBA is unfair labor practice only if the violation is gross in character. The prohibited acts, it should be stressed, are all related to the worker’s self-organizational right and to the observance of a collective bargaining agreement (CBA). The only possible exception is Art. 248(f) referring to dismissing or prejudicing an employee giving testimony under this Code [regardless of the subject of the testimony]. Because ULP is and has to be related to the right to self-organization and to the observance of the CBA, it follows that not every unfair act is “unfair labor practice.” ULP, therefore, has a limited, technical meaning because it is a labor relations concept with a statutory definition. It refers only to acts opposed to worker’s right to organize. Without that element, the act, no matter how unfair, is not unfair labor practice as legally defined. Stripped of legalese, unfair labor practice, when committed by the employer, commonly connotes anti-unionism. 1.2 Prejudice to Public Interest not an Element of U.L.P.
A showing of prejudice to public interest is not a requisite for ULP charges to prosper. 2. PROSECUTION OF U.L.P. Under Art. 247 ULP has civil as well as criminal aspects. The civil aspect may include liability for damages and these may be passed upon by a labor arbiter. To prosecute ULP as criminal offense is not possible until after finality of judgment in the labor case, finding that the respondent indeed committed unfair labor practice. But such judgment will not serve as evidence of ULP in the criminal case; the criminal charge must be proved independently from the labor case. Moreover, while only substantial evidence is required in labor case in the NLRC, proof beyond reasonable doubt is needed to convict in the criminal case of ULP. The criminal charge, states Art. 228, falls under the concurrent jurisdiction of the Municipal or Regional Trial Court. The same article defines the penalty of fine and/ or imprisonment. Under Art. 289, the penalty shall be imposed upon the guilty officers of a corporation, partnership, association or entity. If the ULP is committed by a labor organization the parties liable are those mentioned in Art. 249. The offense prescribes in one year. (Art. 290) ________ Chapter II UNFAIR LABOR PRACTICES OF EMPLOYERS Article 248. Unfair labor practices of employers. – It shall be unlawful for an employer to commit any of the following unfair labor practice: (a) To interfere with, restrain or coerce employees in the exercise of their right to self-organization; (b) To require as a condition of employment that a person or an employee shall not join a labor organization or shall with-draw from one to which he belongs; (c) To contract out services or functions being performed by union members when such will interfere with, restrain or coerce employees in the exercise of their rights to self-organization; (d) To initiate, dominate, assist or otherwise interfere with the formation or administration of any labor organization, including the giving of financial or other support to it or its organizers or supporters; (e) To discriminate in regard to wages, hours of work and other terms and conditions of employment in order to encourage or discourage membership in any labor organization. Nothing in this Code or in any other law shall stop the parties from requiring membership in a recognized collective bargaining agent as a condition for employment, except those employees who are already members of another union at the time of the signing of the collective bargaining agreement. Employees of an appropriate bargaining unit who are not members of the recognized collective bargaining agent may be assessed a reasonable fee equivalent to the dues and other fees paid by members
LABOR RELATIONS of the recognized collective bargaining agent, if such non-union members accept the benefits under the collective bargaining agreement: Provided, that the individual authorization required under Article 242, paragraph (o) of this Code shall not apply to the nonmembers of the recognized collective bargaining agent;
1. Workers' and employers' organisations shall enjoy adequate protection against any acts of interference by each other or each other's agents or members in their establishment, functioning or administration.
(f) To dismiss, discharge or otherwise prejudice or discriminate against an employee for having given or being about to give testimony under this Code;
2. In particular, acts which are designed to promote the establishment of workers' organisations under the domination of employers or employers' organisations, or to support workers' organisations by financial or other means, with the object of placing such organisations under the control of employers or employers' organisations, shall be deemed to constitute acts of interference within the meaning of this Article.
(g) To violate the duty to bargain collectively as prescribed by this Code;
3. NO U.L.P.: ILLUSTRATIVE INSTANCES OF VALID EXERCISE OF MANAGEMENT RIGHTS
(h) To pay negotiation or attorney’s fees to the union or its officers or agents as part of the settlement of any issue in collective bargaining or any other dispute; or
The law on “unfair labor practices” is not intended to deprive employers of their fundamental right to prescribe and enforce such rules as they honestly believe to be necessary to the proper, productive and profitable operation of their business. Nor are his rights of selection and discharge of his employees wrested from him by the Act. Rothenberg stresses that an employer, subject to the provisions of his contract with his employees, has the same full measure of control over his business as he had prior to the enactment of the Wagner Act and undiminished by the amended Act. The only condition imposed upon this control is that it must not be exercised so as to effect a violation of the Act and its several prohibitions.
(i) To violate a collective bargaining agreement. The provisions of the preceding paragraph notwithstanding, only the officers and agents of corporations, associations or partnerships who have actually participated in, authorized or ratified unfair labor practices shall be held criminally liable. (As amended by Batas Pambansa Bilang 130, August 21, 1981). ________
3.1 Personnel Movements 1. CONDITIONS PRECEDENT TO U.L.P. CHARGE Before an employee may be considered aggrieved by an alleged unfair labor practice (ULP) by an employer, it must be demonstrated, firstly, that the injured party comes within the definition of “employee” as that term is defined by the Code, and secondly, the act charged as ULP must fall under the prohibition of Art. 248 (acts of the employer) or 249 (acts of the union).
As a rule, it is the prerogative of the company to promote, transfer or even demote its employees to other positions when the interests of the company reasonably demand it. Unless there are instances which directly point to interference by the company with the employees' right to self-organization, the transfer of private respondent should be considered as within the bounds allowed by law. Furthermore, although private respondent was transferred to a lower position, his original rank and salary remained undiminished.
Nonetheless, specific denomination of the act is not necessary to prosecute ULP. In resolving the question of whether or not an employer committed the act charged in the complaint, it is of no consequence, either as a matter of procedure or of substantive law, how the act is denominated—whether as a restraint, interference or coercion, or a discriminatory discharge, or as a refusal to bargain, or even as a combination of any or all of these. For however the employer’s conduct may be characterized, what is important is that it constituted an unfair labor practice.
It is the company’s prerogative to promote its employees to managerial positions. Managerial positions are offices which can only be held by persons who have the trust of the corporation and its officers. It should not be prevented from doing so. A promotion which is manifestly beneficial to an employee should not give rise to a gratuitous speculation that such a promotion was made simply to deprive the union of the membership of the promoted employee. 3.2 Acceptance of Mass Resignation
2. ILO CONVENTION NO. 98 Article 1 1. Workers shall enjoy adequate protection against acts of anti-union discrimination in respect of their employment. 2. Such protection shall apply more particularly in respect of acts calculated to-(a) make the employment of a worker subject to the condition that he shall not join a union or shall relinquish trade union membership; (b) cause the dismissal of or otherwise prejudice a worker by reason of union membership or because of participation in union activities outside working hours or, with the consent of the employer, within working hours. Article 2
Acceptance of a voluntary resignation is not ULP. In a Philippine Airlines case the court said that the pilots’ "protest retirement/resignation" was not a concerted activity which was protected by law. They did not assume the status of strikers. They cannot, therefore, validly claim that the company committed unfair labor practice. When the pilots voluntarily terminated their employment relationship with the company, they cannot claim that they were dismissed. 3.3 Grant of Profit-Sharing Benefits to Non-Union Members Management has the prerogative to regulate, according to its discretion and judgment, all aspects of employment. This flows from the established rule that labor law does not authorize the substitution of the judgment of the employer in the conduct of its business. Such management prerogative may be availed of without fear of any liability so long as it is exercised in good faith for the advancement of
LABOR RELATIONS the employers' interest and not for the purpose of defeating or circumventing the rights of employees under special laws or valid agreement and are not exercised in a malicious, harsh, oppressive, vindictive or wanton manner or out of malice or spite.
Persistent interrogation of employees to elicit information as to what had happened at union meetings and the identity of the active union employees was held as violative of organizational rights of employees.
3.4 Forced Vacation Leave Where the vacation leave without pay, which the employer requires employees to take in view of the economic crisis, is neither malicious, oppressive or vindictive, ULP is not committed. 3.5 Issuance of Rules or Policy Every business enterprise endeavors to increase its profits. In the process, it may adopt or devise means designed towards that goal.
In order that the questioning of an employee concerning his union activities would not be deemed coercive, the employer must communicate to the employee the purpose of the questioning, assure him that no reprisal would take place, and obtain his participation on a voluntary basis. In addition, questioning must also occur in a context free from employer hostility to union organization and must not itself be coercive in nature. 5.2 U.L.P. Even Before Union is Registered
Even as the law is solicitous of the welfare of the employees, it must also protect the right of an employer to exercise what are clearly management prerogatives. The free will of management to conduct its own business affairs to achieve its purpose cannot be denied.
An employer who interfered with the right to self-organization before the union is registered can be held guilty of ULP.
3.6 Taking Action Against Slowdown
A rule prohibiting solicitation of union membership in company property is unlawful if it applies to non-working time as well as to working time.
Employees have the right to strike, but they have no right to continue working on their own terms while rejecting the standards desired by their employer. Hence, an employer does not commit an unfair labor practice by discharging employees who engaged in a slowdown, even if their object is a pay increase which is lawful. Moreover, an employer does not violate the act by discharging only some of the employees who participate in the slowdown where he discharges them to serve as an “example” to stop the slowdown and not for discriminatory reasons. 4. DETERMINATION OF VALIDITY Necessarily, determining the validity of an employer’s act involves an appraisal of his motives. An employer may treat freely with an employee and is not obliged to support his actions with a reason or purpose. However, where the attendant circumstances, the history of employer's past conduct and like considerations, coupled with an intimate connection between the employer's action and the union affiliations or activities of the particular employee or employees taken as a whole raise a suspicion as to the motivation for the employer's action, the failure of the employer to ascribe a valid reason therefor may justify an inference that his unexplained conduct in respect of the particular employee or employees was inspired by the latter's union membership or activities. While the presence of this mere suspicion neither takes the place of evidence that the employer's conduct was improperly motivated nor dispenses with the requirement of proof of the fact, such suspicion, when coupled with other facts which in themselves, might have been inadequate to support an adverse finding against the employer, may suffice to sustain a finding that the employer's action violated the prohibition of the Act.
5. FIRST U.L.P.: INTERFERENCE (ART. 248[a]) In summarized form, the nine U.L.P. acts of an employer under Art. 248 are: (1) Interference, (2) “yellow dog” condition, (3) contracting out, (4) company unionism, (5) discrimination, (6) discrimination because of testimony, (7) violation of duty to bargaining, (8) paid negotiation, and (9) violation of CBA. 5.1 Interrogation
5.3 Prohibiting Organizing Activities
Where majority of the employees live on the premises of the employer and cannot be reached by any means or procedures practically available to union organizers, the employer may be required to permit non-employee union organizers to come within its premises, in order to solicit employees. However, in the absence of showing that the illegal dismissal was dictated by anti-union motives, the same does not constitute an unfair labor practice as would be a valid ground for strike. The remedy is an action for reinstatement with backwages and damages. We have held that unfair labor practice cases are not, in view of the public interest involved, subject to compromises. 5.4 Violence or Intimidation An employer unlawfully coerced employees by directing two individuals to his office at gun point on the day of representation election after the individuals had informed the employer that they were on the premises to vote in the election. 5.5 Espionage and Surveillance One form of “pressure” which some over-eager employers sometimes use is the practice of spying upon employees. This device consists of using one or a small group of employees, or other agents, inspired by profit opportunism, vengeance or come kindred human frailty to use his or their access to employees’ quarters and affairs for the purpose of spying upon fellow employees and reporting back to the employer. It is plainly evident that such conduct on the employer’s part, however subtly it may be accomplished, constitutes interference with the employee’s exercise of their rights. Inasmuch as the “pressure” results more from the employees’ apprehension than from the employer’s purpose in spying and the use of its result, it has been held to be no answer to a charge of unfair labor practice that the fruits of espionage were not used.
LABOR RELATIONS When an employer engages in surveillance or takes steps leading his employees to believe it is going on, a violation results because the employees come under threat of economic coercion or retaliation for their union activities. Unlawful surveillance was properly found where supervisors were present near the place where union meeting was being held to check the names of employees leaving the meeting. 5.6 Economic Inducements A violation results from an employer’s announcement of benefits prior to a representation election, where it is intended to induce the employees to vote against the union. It is well-settled rule that while a representation election is pending, the conferral of employee benefits for the purpose of inducing the employees to vote against a union is unlawful. 5.7 Employer’s Expression of Opinion; Totality of Conduct Doctrine The doctrine holds that the culpability of employer’s remarks was to be evaluated not only on the basis of their implications, but against the background of and in conjunction with collateral circumstances. (1) Letter to individual employees—It is an act of interference for the employer to send a letter to all employees notifying them to return to work at a time specified therein, otherwise new employees would be engaged to perform their jobs. Individual solicitation of the employees or visiting their homes, with the employer or his representative urging the employees to cease union activity or cease striking, constitutes unfair labor practice. All the above-detailed activities are unfair labor practices because they tend to undermine the concerted activity of the employees, an activity to which they are entitled free from the employer's molestation. (2) Strike-breaking—When the respondent company offered reinstatement and attempted to "bribe" the strikers with "comfortable cots," "free coffee and occasional movies," "overtime" pay for "work performed in excess of eight hours," and "arrangements" for their families, so they would abandon the strike and return to work, they were guilty of strike-breaking and/or union-busting and, consequently, of unfair labor practice. (3) Acts violative of right to organize—Violative of the right to organize, form and join labor organizations are the following acts: the offer of a Christmas bonus to all "loyal" employees of a company shortly after the making of a request by the union to bargain; wage increases given for the purpose of mollifying employees after the employer has refused to bargain with the union, or for the purpose of inducing striking employees to return to work; the employer's promises of benefits in return for the strikers' abandonment of their strike in support of their union; and the employer's statement, made about 6 weeks after the strike started, to a group of strikers in a restaurant to the effect that if the strikers returned to work, they would receive new benefits in the form of hospitalization, accident insurance, profit-sharing, and a new building to work in. (4) Test of interference or coercion—The test of whether an employer has interfered with and coerced employees within the meaning of subsection (a) (1) is whether the employer has engaged in conduct which it may reasonably be said tends to interfere with the free exercise of employees' rights under section 3 of the Act, and it is not necessary that there be direct evidence that any employee was in fact intimidated or coerced by statements of threats of the employer if there is a reasonable inference that anti-union conduct of the employer does have an adverse effect on self-organization and collective bargaining. (5) The “totality of conduct” doctrine—the letters of the company president to the individual strikers should not be considered by themselves alone but should be read in the light of the preceding and subsequent circumstances. The letters should be interpreted according to the "totality of conduct doctrine," whereby
the culpability of an employer's remarks has to be evaluated not only on the basis of their implicit implications, but were to be appraised against the background of and in conjunction with collateral circumstances.
5.8 Mass Layoff Amounting to U.L.P. A company’s capital reduction efforts, to camouflage the fact that it has been making profits, and to justify the mass lay-off of its employees especially union members, were an unfair labor practice which can neither be countenanced nor condoned. 5.9 Lockout or Closure Amounting to U.L.P. A lockout, actual or threatened, as a means of dissuading the employees from exercising their rights under the Act is clearly an unfair labor practice. However, to hold an employer who actually or who threatens to lock out his employees guilty of a violation of the Act, the evidence must establish that the purpose thereof was to interfere with the employees’ exercise of their rights. An honest closing of one’s plant is not a violation of the Act. However, cessation of operations, actual or threatened, does constitute an unfair labor practice, if it is, directly or indirectly, expressly or by innuendo, calculated or employed to interfere with the employees’ rights under the Act. Proof of the employer’s state of mind, unless it is expressed, is often very difficult. However, it may be proven by circumstantial evidence. The rule is that it is unlawful for the employer to threaten its employees with moving or shutting down the plant and consequent loss of employment, as the result of their support for the union. An employer which closed its business to put an end to a union’s activities, and which made no effort to allow the employees’ attempt to exercise their right to self-organization and collective bargaining, and even threatening the employees that they would lose their jobs if they did not cease affiliation with the union, commits unfair labor practice. 5.9a Sale in Bad Faith Where the sale of a business enterprise was attended with bad faith, there is no need to consider the applicability of the rule that labor contracts being in personam are not enforceable against the transferee. The latter is in the position of tort-feasor having been a party likewise responsible for the damage inflicted on the members of the aggrieved union and therefore cannot justly escape liability.
It is irrational to suppose that a purchaser of a manufacturing enterprise is not aware of the labor-management situation in the firm he bought. 5.9b Assumption of Obligations by New Company 5.10 Successor Employer; Piercing the Corporate Veil Closure is likewise not legal and the employees cannot be separated if, in fact, there is no closure because the “closed” department or company reappeared although under a new name. If the “new” company is, for instance, engaging in the same business as the closed company or department, or is owned by the same people, and the “closure” is calculated to defeat the workers’ organizational right, then, the closure may be declared a “subterfuge” and the doctrine of successor employer will be applied, that is, the new company will be
treated as a continuation or successor of the one that closed. If such be the case, the separated employees will have to be employed in the “new” firm because in the first place they should not have been separated at all. The “successor employer” ruling is an enforcement of the legal recourse called “piercing the veil of corporate entity.” Under the doctrine of piercing the veil of corporate entity, when valid grounds therefore exist, the legal fiction that a corporation is an entity with a juridical personality separate and distinct from its members or stockholders may be disregarded. In such cases, the corporation will be considered as a mere association of persons. The members or stockholders of the corporation will be considered as the corporation, that is, liability will attach directly to the officers and stockholders. The doctrine applies when the corporate fiction is used to defeat public convenience, justify wrong, protect fraud, or defend crime, or when it is made as a shield to confuse the legitimate issues or where a corporation is the mere alter ego or business conduit of a person, or where the corporation is so organized and controlled and its affairs are so conducted as to make it merely an instrumentality, agency, conduit or adjunct of another corporation.
6. SECOND U.L.P.: “YELLOW DOG” CONDITION (ART. 248[b]) Contract provisions whereby an employee agrees that during the period of his employment he will not become a member of a labor union have been outlawed in the United States, by legislation in some states, as well as by Federal legislation. The “yellow dog” contract is a promise exacted from workers as a condition of employment that they are not to belong to, or attempt to foster, a union during their period of employment. An American scheme, the typical yellow dog contract is an at-will employment agreement which contains, in addition to the usual provisions for employment, the following three provisions: (1) a representation by the employee that he is not a member of a labor union; (2) a promise by the employee not to join a labor union; (3) a promise by the employee that, upon joining a labor union, he will quit his employment. 7. THIRD U.L.P.: CONTRACTING OUT (ART. 248[c]) Contracting out itself, is not ULP; it is the ill intention that makes it so. An employer’s contracting out of work is itself an unfair labor practice where motivated by a desire to prevent his employees from organizing and selecting a collective bargaining representative, rid himself of union men, or escape his statutory duty to bargain collectively with his employees’ bargaining representative. As we have previously held, the company can determine in its best business judgment whether it should contract out the performance of some of its work for as long as the employer is motivated by good faith, and the contracting out must not have been resorted to to circumvent the law or must not have been the result of malicious or arbitrary action.
7.1 Contracting out restricted by CBA 7.2 Runaway Shop Resorting to a runaway shop is a U.L.P. A “runaway” shop is defined as an industrial plant moved by its owners from one location to
LABOR RELATIONS another to escape union labor regulations or state laws, but the term is also used to describe a plant removed to a new location in order to discriminate against employees at the old plant because of their union activities. Moreover, it has been held that where a plant removal is for business reasons but the relocation is hastened by anti-union motivation, the early removal is an unfair labor practice. It is immaterial that the relocation is accompanied by a transfer of title to a new employer who is an alter ego of the original employer. Runaway shop refers to business relocation animated by anti-union animus. Sameness of business is not reason enough to show run-away shop to pierce the veil of separate corporate entity. A "runaway shop" is defined as an industrial plant moved by its owners from one location to another to escape union labor regulations or state laws, but the term is also used to describe a plant removed to a new location in order to discriminate against employees at the old plant because of their union activities. It is one wherein the employer moves its business to another location or it temporarily closes its business for anti-union purposes. A "runaway shop" in this sense, is a relocation motivated by anti-union animus rather than for business reasons. Mere ownership by a single stockholder or by another corporation of all or nearly all of the capital stock of a corporation is not of itself sufficient ground for disregarding the separate corporate personality. This fiction of corporate entity can only be disregarded in certain cases such as when it is used to defeat public convenience, justify wrong, protect fraud, or defend crime. To disregard said separate juridical personality of a corporation, the wrongdoing must be clearly and convincingly established.
8. FOURTH U.L.P.: COMPANY-DOMINATION OF UNION (ART. 248[d]) Domination of a labor union usually manifests in the following forms: (a) Initiation of the company union idea. This may further occur in three styles: (1) outright formation by the employer or his representatives; (2) employee formation on outright demand or influence by employer; and (3) managerially motivated formation by employees. (b) Financial support to the union. An employer commits unfair labor practice if he defrays the union expenses or pays the attorney’s fees to the attorney who drafted the constitution and by-laws of the union. (c) Employer encouragement and assistance. Immediately granting the union exclusive recognition as a bargaining agent without determining whether the union represents the majority of employees is an illegal form of assistance amounting to unfair labor practice. (d) Supervisory assistance. This takes the form of soliciting membership, permitting union activities during working time or coercing employees to join the union by threats of dismissal or demotion. An employer was held to have unlawfully aided a union by assisting its attempt to secure authorization cards from employees and by executing a contract with such union when it was not the authorized representative of the employees. A labor union is company-dominated where it appears that key officials of the company have been forcing employees belonging to a rival labor union to join the former under pain of dismissal should they refuse to do so; that hey officials of the company, as well as its legal counsel, have attended the election of
LABOR RELATIONS officers of the former union; that officers and members of the rival union were dismissed allegedly pursuant to a retrenchment policy of the company, after they had presented demands for the improvement of the working conditions despite its alleged retrenchment policy; and that, after dismissal of the aforesaid officers of the rival labor union, the company engages the services of new laborers.
9. FIFTH U.L.P.: DISCRIMINATION (ART. 248[e]) What the law prohibits is discrimination to encourage or discourage membership in a labor organization. Where the purpose is to influence the union activity of employees, the discrimination is unlawful. But discrimination is not the same as differentiation or classification. For instance, it is common management practice to classify jobs and grant them varying levels of pay benefits package. These are valid differentiations that recognize differences in job requirements or contributions. They are not necessarily discrimination classifiable as ULP. Under the Industrial Peace Act, to constitute an unfair labor practice, the discrimination committed by the employer must be in regard to the "hire or tenure of employment or any term or condition of employment to encourage or discourage membership in any labor organization." The exaction, by the Company, from the strikers returning to work, of a promise not to destroy company property and not to commit acts of reprisal against the Unionmembers who did not participate in the strike, cannot be considered as intended to encourage or discourage Union-membership. Taking the circumstances surrounding the prescribing of that condition, the requirement by the Company is actually an act of self-preservation and designed to insure the maintenance of peace and order in the Company premises.
employment. While the right of strikes at the very heart of an employer to dismiss an employee is conceded in a valid retrenchment, the right differs from and should not be confused with the manner in which such right is exercised. It should not be oppressive and abusive since it affects one's person and property. Due process of law demands nothing less.
9.4 Discrimination in Regularization 9.5 Discrimination by Blacklisting A blacklist has been defined as “a list of persons marked out for special avoidance, antagonism or enmity on the part of those who prepare the list, or those among whom it is intended to circulate, as where a trade union ‘blacklists’ workmen who refuse to conform to its rules, or where a list of insolvent or untrustworthy persons is published by a commercial agency or mercantile association.” When it is resorted to by a combination of employers to prevent employment of employees for union activities, it may constitute unfair labor practice. Aside from constituting an unfair labor practice, it may give rise to a right of action for damages by the employees prejudice under Article 28 of the new Civil Code.
Discouraging membership in a labor organization includes not only discouraging adhesion to union membership but also discouraging participation in union activities such as legitimate strike.
In its broad sense, however that is, in the sense of the employer’s circulating a list of former employees of notorious laziness or negligence in the performance of their duties or of incorrigible propensity to create trouble in the place of employment, it may be a proper measure for the protection of employers. Thus, it has been held that unless the action of the employers in combining or in passing communications among themselves for the purpose of excluding unwanted workers from employment, constitutes a libel or slander (and according to some decisions the defamation, to be actionable, must be malicious), the excluded employee possesses no right of action because the employers’ community of interest acts both to justify the combination and to privilege the communication.
9.1 Discrimination in Work Quota
9.6 Indirect Discrimination
Considered in the light of the anti-union attitude exhibited by respondent company in transferring union president Leones from the main office in Manila to Cebu when the union was still being organized, and which act was found by the NLRC as constituting unfair labor practice and union-busting in connection with the application for clearance to terminate Leones filed by respondent company, 34 the uneven application of its marketing plan by respondent company is patently an act of discrimination, considered as an unfair labor practice under Art. 248(e) of the Labor Code.
It is a well settled rule of law that what is prohibited to be done directly shall not be allowed to be accomplished indirectly.
9.2 Discrimination in Bonus Allocation or Salary Adjustments There is unfair and unjust discrimination in the granting of salary adjustments where the evidence shows that (a) the management paid the employees of the unionized branch; (b) where the salary adjustments were granted to employees of one of its nonunionized branches although it was losing in its operations; and (c) the total salary adjustments given every ten of its unionized employees would not even equal the salary adjustments given one employee in the nonunionized branch. 9.3 Discrimination in Layoff or Dismissal Even where business conditions justified a layoff of employees, unfair labor practices in the form of discriminatory dismissal were found where only unionists were permanently dismissed while nonunionists were not. Labor is a person's means of livelihood. He cannot be deprived of his labor or work without due process of law. Retrenchment very heart of one's
Thus, the following acts have been held unfair labor practices: (1) the dismissal of a laborer in account of union activities of his brother; (2) the discharge of an employee due to the union activities of the wife; and (3) the discharge of a wife due to the union activities of the husband. 9.7 Test of Discrimination For the purpose of determining whether or not a discharge is discriminatory, it is necessary that the underlying reason for the discharge be established. The fact that a lawful cause for discharge is available is not a defense where the employee is actually discharged because of his union activities. If the discharge is actually motivated by a lawful reason, the fact that the employee is engaged in union activities at the time will not lie against the employer and prevent him from the exercise of his business judgment to discharge an employee for cause. Where circumstances establish a discriminatory motive on the part of the employer, the assignment of a just cause will be unavailing. If it can be established that the true and basic inspiration for the employer’s act is derived from the employees’ union affiliations or activities, the assignment by the employer of another reason, whatever its semblance of validity, is unavailing.
An interference that the discharge of an employee was motivated by his union activity must be based upon evidence, direct or circumstantial, not upon mere suspicion.
LABOR RELATIONS Maintenance of Membership Shop: No employee is compelled to join the union, but all present or future members must, as a condition of employment, remain in good standing in the union.
9.8 Constructive Discharge
Exclusive Bargaining Shop: The union is recognized as the exclusive bargaining agent for all employees in the bargaining unit, whether union members or not.
Where the employer prohibits employees from exercising their rights under the Act, on pain of discharge, and the employee quits as a result of the prohibition, a constructive discharge occurs, which may be remedies in an unfair labor practice proceeding.
Bargaining for Members Only: The union is recognized as the bargaining agent only for its own members
9.9 Discharge Due to Union Activity, A Question of Fact The question of whether an employee was discharged because of his union activities is essentially a question of fact as to which the findings of the Court of Industrial Relations are conclusive and binding if supported by substantial evidence considering the record as a whole. This is so because the Industrial Court is governed by the rule of substantial evidence, rather than by the rule of preponderance of evidence as in any ordinary civil cases. Substantial evidence has been defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. It means such evidence which affords a substantial basis from which the fact in issue can be reasonably inferred.
Agency Shop: An agreement whereby employees must either join the union or pay the union as exclusive bargaining agent a sum equal to that paid by the members. This is directed against “free rider” employees who benefits from union activities without contributing financially to union support. It prevents situation where non-union members enrich themselves at the expense of union members. Another term for agency shop agreement is “maintenance of treasury shop.” The above variations are opposite of open shop, an arrangement which does not require union membership as a condition of employment.
9.10 Valid Discrimination: Union Security Clause
9.10b Validity of Closed-Shop Agreement
There is a form of encouragement of union membership which is not considered ULP. This is where Management and Union enter into a collective bargaining agreement containing a union security clause. Despite variations and limitations, a union security clause essentially requires membership in the union so that an employee may retain his job and the union’s existence is assured.
It is true that disaffiliation from a labor union is not open to legal objection. It is implicit in the freedom of association ordained by the Constitution. But this Court has laid down the ruling that a closed shop is a valid form of union security, and such provision in a collective bargaining agreement is not a restriction of the right of freedom of association guaranteed by the Constitution.
“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. It is indeed compulsory union membership whose objective is to assure continued existence of the union. In a sense, there is discrimination when certain employees are obliged to join a particular union. But it is discrimination favouring unionism; it is a valid kind of “discrimination.” The employer is not guilty of unfair labor practice if it merely complies in good faith with the request of the certified union for the dismissal of employees expelled from the union pursuant to the union security clause in the collective bargaining agreement. 9.10a Kinds of Union Security Agreements Closed-shop: Only union members can be hired by the company and they must remain as union members to retain employment in the company. Union Shop: Nonmembers may be hired, but to retain employment must become union members after a certain period. The requirement applies to present and future employees. Modified Union Shop: Employees who are not union members at the time of signing the contract need not join the union, but all workers hired thereafter must join.
It is the policy of the State to promote unionism to enable the workers to negotiate with management on the same level and with more persuasiveness than if they were to individually and independently bargain for the improvement of their respective conditions. To this end, the Constitution guarantees to them the rights "to self-organization, collective bargaining and negotiations and peaceful concerted actions including the right to strike in accordance with law." There is no question that these purposes could be thwarted if every worker were to choose to go his own separate way instead of joining his co-employees in planning collective action and presenting a united front when they sit down to bargain with their employers. It is for this reason that the law has sanctioned stipulations for the union shop and the closed shop as a means of encouraging the workers to join and support the labor union of their own choice as their representative in the negotiation of their demands and the protection of their interest vis-a-vis the employer. A closed-shop agreement is an agreement whereby an employer binds himself to hire only members of the contracting union who must continue to remain members in good standing to keep their jobs. It is "the most prized achievement of unionism." It adds membership and compulsory dues. By holding out to loyal members a promise of employment in the closed-shop, it welds group solidarity. It is a very effective form of union security agreement.
9.10c Advantages and Disadvantages of Closed-Shop Agreement A closed-shop agreement is advantageous because it— a. Increases the strength and bargaining power of labor organizations. b. Prevents non-union workers from sharing in the benefits of the union’s activities without also sharing its obligations. c. Prevents the weakening of labor organizations by discrimination against union members.
d. Eliminates the lowering of standards caused by competition with non-union workers.
LABOR RELATIONS implication any dismissal of employees already working before the agreement was made.
e. Enables labor organizations effectively to enforce collective agreements.
9.10f Due Process Required in Enforcing Union Security Clause; Intra-union Matter becomes Termination Dispute with Employer
f. Facilitates the collection of dues and the enforcement of union rules.
Although a union security clause in a CBA may be validly enforced and that dismissal pursuant thereto may likewise be valid, this does not erode the fundamental requirement of due process. The reason behind the enforcement of union security clauses which is the sanctity and inviolability of contracts cannot override one's right to due process.
g. Creates harmonious relations between the employer and employee. But it is disadvantageous as it— a. Results in monopolistic domination of employment by labor organizations. b. Interferes with the freedom of contract and personal liberty of the individual worker. c. Compels employers to discharge all non-union workers regardless of efficiency, length of service, etc. d. Facilitates the use of labor organizations by unscrupulous union leaders for the purpose of extortion, restraint of trade, etc. e. Denies to non-union workers equal opportunity for employment. f. Enables union to charge exorbitant dues and initiation fees. 9.10d Valid Dismissal Because of Application of Union Security Clause Union security clauses in collective bargaining agreements, if freely and voluntarily entered into, are valid and binding. Corollary, dismissals pursuant to union security clauses are valid and legal subject only to the requirement of due process, that is, notice and hearing prior to dismissal. Thus, the dismissal of an employee by the company pursuant to a labor union's demand in accordance with a union security agreement does not constitute unfair labor practice. Even if the union members were unaware of the closed-shop stipulation in the CBA, they were bound by it. Neither their ignorance of, nor their dissatisfaction with its terms and conditions would justify breach thereof or the formation by them of a union of their own. This is so because a union member who is employed under an agreement between the union and his employer is bound by the provisions thereof, since it is a joint and several contract of the members of the union entered into by the union as their agent. This provision is an indirect restriction on the right of an employee to selforganization. It is a solemn pronouncement of a policy that while an employee is given the right to join a labor organization, such right should only be asserted in a manner that will not spell the destruction of the same organization The law requires loyalty to the union on the part of its members in order to obtain to the full extent its cohesion and integrity.
9.10e Dismissal Pursuant to Closed-Shop Clause Must Clearly Appear in Contract In order to validly dismiss an employee by force of the union security clause, there should be a clear and unequivocal statement that the loss of the status of a member of good standing in the union shall be a cause for dismissal. Union shop, as with closed-shop provisions, should be strictly construed against the existence of union shop. Sometimes harsh and onerous, such provisions should not be extended beyond the explicit coverage of their terms, and will not be deemed to authorize by
9.10g Liability of Union to Pay Wages and Fringe Benefits of Illegally Dismissed Employee 9.10h Employer in Good Faith Not Liable 9.10i Closed-Shop, To Whom Not Applicable All employees in the bargaining unit covered by a closed-shop agreement are subject to its terms, except the following: (1) any employee who at the time the closed-shop agreement takes effect is a bona fide member of religious organization which prohibits its members from joining labor unions on religious grounds; (2) employees already in the service and already members of a labor union or unions other than the majority union at the time the closedshop agreement took effect; (3) Confidential employees who are excluded from the rank-and-file bargaining unit; and (4) employees excluded from the closed-shop by express terms of the agreement. It is well settled in this jurisdiction that, in the absence of a manifest intent to the contrary, "closed shop" provisions in a collective bargaining agreement "apply only to persons to be hired or to employees who are not yet members of any labor organization" and that said provisions of the agreement are not applicable to those already in the service at the time of its execution. To hold that the employees in a company who are members of a minority union may be compelled to disaffiliate from their union and join the majority or contracting union, would render nugatory the right of all employees to self organization and to form, join or assist labor organizations of their own choosing, a right guaranteed by the Industrial Peace Act (sec. 3, Rep. Act No. 875) as well as by the Constitution (Art. III, sec. 1).
9.10j Agency Fee Instead of Union Membership The employees who are benefitting from the CBA, without being members of the bargaining union, may be required to pay an agency fee. The collection of agency fees in an amount equivalent to union dues and fees, from employees who are not union members, is recognized by Article 248 (e) of the Labor Code. A written authorization from the non-union employee is imposed. The employee's acceptance of benefits resulting from a collective bargaining agreement justifies the deduction of agency fees from his pay and the union's entitlement thereto. In this aspect, the legal basis of the union's right to agency fees is neither contractual nor statutory, but quasi-contractual, deriving from the established principle that nonunion employees may not unjustly enrich themselves by benefiting from employment conditions negotiated by the bargaining union. The justification of collecting agency fee is the union’s accomplishment in having negotiated a CBA in behalf of the employees. The union served as agent of the employees, and the agency fee is recognition of the agent’s efforts. The fee is collectible
LABOR RELATIONS only from employees deriving economic benefits from the unionnegotiated CBA. 10. SIXTH U.L.P.: DISCRIMINATION TESTIMONY (ART. 248[f])
The law protects not only the employees’ right to form, join, or assist labor organizations but also their right to testify on matters covered by the Code. If this right is not protected, the right to self-organization will be indirectly defeated because the employees will fear their employer’s reprisal. By protecting the employee’s right to testify, the law therefore shields the workers’ right to self-organization from indirect assault by the employer. Thus, it is ULP “to dismiss, discharge, or otherwise prejudice or discriminate against an employee for having given or being about to give testimony under this Code. Employer’s reprisal against a testifying employee is ULP because, furthermore, it violates the right to engage in concerted activity, a right included in the right to self-organize (Art. 246) and reiterated in Article 263(b). Concerted activity does not always require a number of people acting in unison. An employee acting alone in pursuing a group interest may be said to be doing a concerted activity which the employer may not curtail.
12. EIGHT U.L.P.: PAID NEGOTIATION (ART. 248[h]) Self-organization and collective bargaining are treasured rights of workers. The law zealously shields them from corruption. It is a punishable act of ULP for the employer to pay the union or any of its officers or agents any negotiation fee or attorney’s fee as part of settlement in collective bargaining or any labor dispute. To do so is not unlawful. It is ethically reprehensible. 13. NINTH U.L.P.: VIOLATION OF THE CBA (ART. 248[i]) After a CBA is concluded, its implementation follows. Implementation is still part of the bargaining process which, it should be recalled, rests on the parties’ “duty to bargain.” The duty to bargain, it should also be recalled, requires good faith. And good faith implies faithful observance of what has been agreed upon. It logically follows that noncompliance with the agreement is non-observance of good faith in bargaining; therefore, the noncompliance amounts to ULP. But such violation, to constitute ULP, must be “gross,” according to Art. 261.
10.1 Refusal to Testify
14. RELIEF IN U.L.P. CASES
Clearly, the efforts to justify petitioner's dismissal — on top of the private respondent's scheme of inducing his employees to sign an affidavit absolving him from possible violations of the Labor Code — taints with evident bad faith and deliberate malice petitioner's summary termination from employment. The pivotal question in any case where unfair labor practice on the part of the employer is alleged is whether or not the employer has exerted pressure, in the form of restraint, interference or coercion, against his employee's right to institute concerted action for better terms and conditions of employment. Without doubt, the act of compelling employees to sign an instrument indicating that the employer observed labor standards provisions of law when he might have not, together with the act of terminating or coercing those who refuse to cooperate with the employer's scheme constitutes unfair labor practice. The first act clearly preempts the right of the hotel's workers to seek better terms and conditions of employment through concerted action.
14.1 Cease and Desist Order
10.2 Labor Standards Violation May Lead to a Srike Art. 118. Retaliatory measures. It shall be unlawful for an employer to refuse to pay or reduce the wages and benefits, discharge or in any manner discriminate against any employee who has filed any complaint or instituted any proceeding under this Title or has testified or is about to testify in such proceedings. And yet, Articles 118 and 248 are related. They both speak of employee’s filing a complaint or giving testimony. But the subject of complaint or testimony under Article 118 is limited to matters about wages, the subject of Title I of Book III. Under Article 248, on the other hand, the subject testified to is any issue covered by the Code. Both articles likewise speak of retaliation by the employer. Retaliation is wrong, and more than that, Article 248 considers it an unfair labor practice which, under Art. 263, is a legal reason for employees to hold a strike. 11. SEVENTH U.L.P.: VIOLATION OF THE DUTY TO BARGAIN (ART. 248[g]) The seventh ULP act under Art. 248 refers to violating the duty to bargain. See Articles 252 and 253
To support a cease and desist order, the record must show that the restrained misconduct was an issue in the case; that there was a finding of fact of said misconduct and such finding of fact was supported by evidence. The Court is not authorized to issue blank cease and desist orders, but must confine its injunction orders to specific act or acts which are related to past misconduct. A cease and desist order is not invalidated because the act complained of was voluntarily discontinued prior to or during the course of the proceedings. But if the act complained of happened so long a time that there is no longer any threat or probability of a recurrence, a cease and desist order will not be justified. 14.2 Affirmative Order The Court does not only have the power to issue negative or prohibitive orders but also affirmative or positive orders. The order may usually direct the full reinstatement of the discharged employees to their substantially equivalent position without prejudice to their seniority and other rights and privileges. 14.3 Order to Bargain; Mandated CBA Likewise, when an employer has failed or refused to bargain with the proper bargaining agent of his employees, the Court may, in addition to the usual cease and desist orders, issue an affirmative order to compel the respondent to “bargain” with the bargaining agent. 14.4 Disestablishment Where the employer had initiated, dominated or assisted in or interfered with the formation or establishment of any labor organization or contributed financial or other support to it, the Court may issue, in addition to a cease and desist order, an order directing
the employer to withdraw all recognition from the dominated labor union and to disestablish the same. 15. U.L.P. NOT SUBJECT TO COMPROMISE Unfair labor practice cases are not, in view of the public interest involved, subject to compromises. The relation between capital and labor are not merely contractual. They are so impressed with the public interest that labor contracts must yield to the common good. 16. U.L.P. IN A GIVEN PERIOD SHOULD BE INCLUDED IN SINGLE CHARGE When a labor union accuses an employer of acts of unfair labor practice allegedly committed during a given period of time, the charges should include all acts of unfair labor practice committed against any and all members of the Union during that period. The Union should not, upon the dismissal of the charges first preferred, be allowed to split its cause of action and harass the employer with subsequent charges. based upon acts committed during the same period of time. 17. EMPLOYER’S RESPONSIBILITY FOR U.L.P. ACTS BY SUBORDINATE OFFICIALS Knowledge by the employer of the employee’s improper acts: Where it was established that the employer was aware of the employee’s wrongdoing, his failure to prevent continuation of the course of conduct or his failure to renounce any connection or affinity therewith, invited the imputation of fault and responsibility to the employer. Continuity of improper conduct by employee: A single utterance by a supervisory employee, whether improvident or deliberate on the employee’s part, was not ordinarily and n absence of proof of actual authority held to be sufficient to convict an employer of an unfair labor practice; however, continued, repeated or widespread activities by such supervisory employee in affront of the rights of the body of employees was deemed ample justification for ascribing knowledge and blame to the employer. Employer’s past policy and attitude: It has been held that, among other things, the similarity between the past attitude or policy of the employer and that of the offending supervisory employee might, in certain cases, be indicative of a concert of effort between the two. ________ Chapter III UNFAIR LABOR PRACTICES OF LABOR ORGANIZATIONS
LABOR RELATIONS and conditions under which membership or continuation of membership is made available to other members; (c) To violate the duty, or refuse to bargain collectively with the employer, provided it is the representative of the employees; (d) To cause or attempt to cause an employer to pay or deliver or agree to pay or deliver any money or other things of value, in the nature of an exaction, for services which are not performed or not to be performed, including the demand for fee for union negotiations; (e) To ask for or accept negotiation or attorney’s fees from employers as part of the settlement of any issue in collective bargaining or any other dispute; or (f) To violate a collective bargaining agreement. The provisions of the preceding paragraph notwithstanding, only the officers, members of governing boards, representatives or agents or members of labor associations or organizations who have actually participated in, authorized or ratified unfair labor practices shall be held criminally liable. (As amended by Batas Pambansa Bilang 130, August 21, 1981). ________ 1. RESTRAINT OR COERCION BY LABOR ORGANIZATION; INTERFERENCE BY UNION IS NOT ULP A labor organization commits ULP when it restrains or coerces employees in their right to self-organization. This provision of Art. 249(a) parallels with Art. 248(a). But “interference” is left out. This deliberate omission is “the equivalent of license of labor organization to engage in those practices which, at the hands of an employer, would constitute actionable unfair labor practices by way of “interference.” In other words, a labor organization may interfere in the employees’ right to self-organization as long as the interference does not amount to restraint or coercion. Interference by a labor organization is not ULP because interfering in the exercise of the right to organize is itself a function of selforganizing. 1.1 Coercing Participation in Strike The provision is violated by a union’s restraining or coercing an employee in the exercise of his right to refuse to participate in or recognize a strike. Similarly, violation is committed when a union threatens employees with bodily harm in order to force them to strike. 2. UNION-INDUCED DISCRIMINATION
Article 249. Unfair labor practices of labor organizations. - It shall be unfair labor practice for a labor organization, its officers, agents or representatives: (a) To restrain or coerce employees in the exercise of their right to self-organization. However, a labor organization shall have the right to prescribe its own rules with respect to the acquisition or retention of membership; (b) To cause or attempt to cause an employer to discriminate against an employee, including discrimination against an employee with respect to whom membership in such organization has been denied or to terminate an employee on any ground other than the usual terms
The law forbids as ULP union attempts to cause an employer to grant advantages for union members over non-members, for union members in good standing over suspended or expelled members, for union members over permit holders, for members of the union executive board over more senior employees, for members of one union over members of another union, or for members of one local over members of another local. The forbidden discrimination may refer to terms of hiring or firing, in layoff, in seniority, or in benefits. 2.1 Arbitrary Use of Union Security Clause
LABOR RELATIONS The broad rule is that the union has the right to determine its membership and to prescribe the conditions for the acquisition and retention thereof. Consequently, admission to membership may not be compelled. This rule, however, is qualified in the case of labor unions holding a monopoly in the supply of labor, either in a given locality, or as regards a particular employer by reason of a closed-shop or similar agreements. In such case, qualified applicants may not be arbitrarily excluded from membership and their admission may not be barred by unreasonable rules. It is well settled that labor unions are not entitled to arbitrarily exclude qualified applicants for membership, and a closed-shop provision would not justify the employer in discharging, or a union in insisting upon the discharge of, an employee whom the union thus refuses to admit to membership, without any reasonable ground therefor.4 Needless to say, if said unions may be compelled to admit new members, who have the requisite qualifications, with more reason may the law and the courts exercise the coercive power when the employee involved is a long standing union member, who, owing to provocations of union officers, was impelled to tender his resignation, which he forthwith withdrew or revoked. Surely, he may, at least, invoke the rights of those who seek admission for the first time, and cannot arbitrarily he denied readmission. The Court stresses, however, that union security clauses are also governed by law and by principles of justice, fair play, and legality. Union security clauses cannot be used by union officials against an employer, much less their own members, except with a high sense of responsibility, fairness, prudence, and judiciousness.
(a) When a party desires to negotiate an agreement, it shall serve a written notice upon the other party with a statement of its proposals. The other party shall make a reply thereto not later than ten (10) calendar days from receipt of such notice; (b) Should differences arise on the basis of such notice and reply, either party may request for a conference which shall begin not later than ten (10) calendar days from the date of request. (c) If the dispute is not settled, the Board shall intervene upon request of either or both parties or at its own initiative and immediately call the parties to conciliation meetings. The Board shall have the power to issue subpoenas requiring the attendance of the parties to such meetings. It shall be the duty of the parties to participate fully and promptly in the conciliation meetings the Board may call; (d) During the conciliation proceedings in the Board, the parties are prohibited from doing any act which may disrupt or impede the early settlement of the disputes; and (e) The Board shall exert all efforts to settle disputes amicably and encourage the parties to submit their case to a voluntary arbitrator. (As amended by Section 20, Republic Act No. 6715, March 21, 1989). ________
2.2 Not Disloyalty to Ask Help from Another Union
Article 251. Duty to bargain collectively in the absence of collective bargaining agreements. – In the absence of an agreement or other voluntary arrangement providing for a more expeditious manner of collective bargaining, it shall be the duty of employer and the representatives of the employees to bargain collectively in accordance with the provisions of this Code. ________
3. REFUSAL TO BARGAIN
1. NATURE OF COLLECTIVE BARGAINING
ULP under Art. 249(c) is intended to insure that unions approach the bargaining table with the same attitude of willingness to agree as the Act requires of management.
A union member may not be expelled from her union, and consequently from her job, for personal or impetuous reasons or for causes foreign to the closedshop agreement and in a manner characterized by arbitrariness and whimsicality.
A union violates its duty to bargain collectively by entering negotiations with a fixed purpose of not reaching an agreement or signing a contract. 4. FEATHERBEDDING AND MAKE-WORK ARRANGEMENTS Art. 249(d) refers to featherbedding. “Featherbedding” is the name given to employee practices which create or spread employment by “unnecessarily” maintaining or increasing the number of employees used, or the amount of time consumed, to work on a particular job. In spite of employee assertions that these so-called featherbedding practices are directly related to job security, health and safety, most courts at common law found these practices to be economically wasteful and without any legitimate employee justification. ________ Title VII COLLECTIVE BARGAINING AND ADMINISTRATION OF AGREEMENTS ART. 250. Procedure in collective bargaining. - The following procedures shall be observed in collective bargaining:
Collective bargaining or negotiations towards a collective agreement is a democratic framework to stabilize the relation between labor and management and to create a climate of sound and stable industrial peace. It is a mutual responsibility of the employer and the Union and is characterized as a legal obligation. Collective bargaining includes four related but distinguishable processes: (1) negotiation between representatives of the management and the union over “wages, hours, and other terms of employment;” (2) the execution of a written contract embodying the terms agreed upon; (3) negotiation of any question arising as to the interpretation or application of the contract; and (4) negotiation over the terms of a new contract or proposed modifications, when an existing agreement is validly opened for negotiations. Collective bargaining is a system made up of a set of continuous processes; it is customary and helpful to distinguish negotiation of contracts (the “legislative” phase of the union-employer relationship),
administration of contracts (the “executive phase), and interpretation or application of contracts (the “judicial” phase). In common usage as well as in legal terminology, collective bargaining denotes negotiations looking forward to a collective agreement. However, it does not end with the execution of an agreement. It is a continuous process. It requires both parties, the employer and duly authorized representatives of employees, to deal with each other with open and fair minds and sincerely endeavor to fight the obstacles in the process to stabilize employer-employee relationship.
LABOR RELATIONS important element in employment, and “consent assures stability because parties who have accepted an agreement will live by its terms.” 2. EMERGENCE OF COLLECTIVE BARGAINING First in Great Britain, but not much later in other countries, working men sought to protect themselves against the harsh effects of new machines, new methods of production, new divisions of labor and new intensities of competition by forming organizations capable of representing their interests as a group vis-à-vis employees and the State.
1.1a CBA Defined 2.1 Originator A collective bargaining agreement (CBA), as used in Article 252 of the Labor Code, refers to a contract executed upon request of either the employer or the exclusive bargaining representative incorporating the agreement reached after negotiations with respect to wages, hours of work and all other terms and conditions of employment, including proposals for adjusting any grievances or questions arising under such agreement. While the terms and conditions of a CBA constitute the law between the parties, it is not, however, an ordinary contract to which is applied the principles of law governing ordinary contracts. A CBA, as a labor contract within the contemplation of Article 1700 of the Civil Code of the Philippines which governs the relations between labor and capital, is not merely contractual in nature but impressed with public interest, thus, it must yield to the common good. As such, it must be construed liberally rather than narrowly and technically, and the courts must place a practical and realistic construction upon it, giving due consideration to the context in which it is negotiated and purpose which it is intended to serve.
A CBA is more than a contract; it is a generalized code to govern a myriad of cases which the draftsmen wholly anticipate. It covers the whole employment relationship and prescribes the rights and duties of the parties.
The credit for coining the expression belongs to Beatrice Webb, who first used it in 1891 in her study on “The Cooperative Movement in Great Britain.” In non-English speaking countries, particularly on the European continent, where the process of collective bargaining has an equally long history, the emphasis was placed on the term “collective agreement” because during the early period the workers aimed not so much at establishing the procedure of bargaining itself as at having such agreements recognized and enforced as legally binding contracts. 2.2 Adoption in the Philippines In the Philippines the idea of collective bargaining first gained formal and official recognition through Commonwealth Act No. 213, approved by President Manuel L. Quezon on November 21, 1936. But it is the Industrial Peace Act (RA No. 875, approved by President Elpidio Quirino on June 17, 1953), that defined collective bargaining and outlined its procedure. 3. PARTIES TO COLLECTIVE BARGAINING
1.2 Rationale By “collective bargaining” the employee shares through his chosen representatives in fixing the conditions under which he works, and a rule of law is substituted for absolute authority.
The duty to bargain collectively arises only between the “employer” and its “employees”. Where neither party is an “employer” nor an "employee" of the other, no such duty would exist. Needless to add, where there is no duty to bargain collectively the refusal to bargain violates no right.
1.3 Strength of the Collective Bargaining Method Collective bargaining is also a means of ensuring worker’s participation in decision-making. The notion that workers are entitled to participate in setting the terms under which they are to work is inherent in collective bargaining; even the most rudimentary form of collective bargaining involves a transfer of certain issues, be it only wages, from the area of unilateral to the area of bilateral decisionmaking. It provides an opportunity for the exchange of information tending to enhance the understanding of the parties for each other problems and objectives, both where they differ and where they are identical. Moreover—and this is very important—it provides an orderly procedure by which each side can seek to present to the other the best possible case for the satisfaction of its particular demands. It elicits the consent of those who will have to live under the terms of any agreement derived from the bargaining process. Stability is an
The parties, then, to collective bargaining as traditionally understood, are the employer and the employees represented by their labor union. Article. 212. (j) "Bargaining representative" means a legitimate labor organization whether or not employed by the employer.
The bargaining representative of the employees is an entity—the union—and not the officers of the union. 4. JURISDICTIONAL PRECONDITIONS OF COLLECTIVE BARGAINING While it is a mutual obligation of the parties to bargain, the employer, however, is not under any legal duty to initiate contract negotiation. The mechanics of collective bargaining is set in motion only when the following jurisdictional preconditions are present, namely: (1) possession of the status of majority representation of the employees' representative in accordance with any of the means of selection or designation provided for by the Labor Code;
(2) proof of majority representation; and
LABOR RELATIONS the basic reason the bargaining procedure is governed primarily by agreement of the parties.
(3) a demand to bargain under Article 251, par. (a) of the New Labor Code.
In the presence of validly agreed procedure, the Labor Code procedure applies suppletorily only.
An employer’s duty to recognize and bargain collectively with a union as the collective bargaining representative of his employees does not arise until after the union requests the employer to bargain. Hence, an employer is not in default respecting the duty to bargain until a request therefor has been made.
D.O. No. 40-03 supplements the codal provisions:
It is essential to the right of a putative bargaining agent to represent the employees that it be the delegate of a majority of the employees and, conversely, an employer is under duty to bargain collectively only when the bargaining agent is representative of the majority of the employees. A natural consequence of these principles is that the employer has the right to demand of the asserted bargaining agent proof of its representation of its employees. Having the right to demonstration of this fact, it is not an 'unfair labor practice' for an employer to refuse to negotiate until the asserted bargaining agent has presented reasonable proof of majority representation. It is necessary however, that such demand be made in good faith and not merely as a pretext or device for delay or evasion. The employer's right is however to reasonable proof.
4.1 Bargaining with Minority Union, ULP Where a majority representative has been designated, it is an unfair labor practice, [for the employer] as a refusal of collective bargaining, to deal and negotiate with the minority representative. On the union side, where there exists a legitimate issue as to which of several unions is the legitimate representative of employees, it is ULP for one of the unions to stage a strike and demand that the employer sit down with it for collective bargaining.
If the three jurisdictional preconditions are present, the collective bargaining should begin within the 12 months following the determination and certification of the employees’ exclusive bargaining representative. This period is known as the “certification year.” The employer’s duty to bargain during the certification year has been held to extend throughout the entire year. Absent unusual circumstances, an employer commits an unfair labor practice by refusing to bargain with the union during its certification year, notwithstanding the repudiation of the union by a majority of its employees before the expiration of the one-year period. The rule is the same whether the union lost its majority as a result of the employer’s unfair labor practices or through no fault of the employer. A union which has been certified by the NLRB as a bargaining representative for a particular unit enjoys an irrefutable presumption of a majority status for one year, absent special circumstances. Following the expiration of the one-year certification period, there continues to be a presumption in favor of a union majority, though the presumption is rebuttable. Employee turnover does not constitute “unusual circumstances” shortening the period. BARGAINING
Section 4. Procedure in single enterprise bargaining - A recognized or certified labor union that desires to negotiate with its employer shall submit such intention in writing to the employer, together with its proposals for collective bargaining.
The recognized or certified labor union and its employer may adopt such procedures and processes they may deem appropriate and necessary for the early termination of their negotiations. They shall name their respective representatives to the negotiation, schedule the number and frequency of meetings, and agree on wages, benefits and other terms and conditions of work for all employees covered in the bargaining unit. 7. MULTI-EMPLOYER BARGAINING Collective bargaining may take place at the national, industry, or enterprise level. The Philippines so far has tried only enterprise-level, or decentralized bargaining. 7.1 Rationale of Multi-employer Bargaining
5. WHEN BARGAINING SHOULD BEGIN
6. SINGLE ENTERPRISE BROADLY DESCRIBED
Section 3. When single enterprise bargaining available. - Any voluntarily recognized or certified labor union may demand negotiations with its employer for terms and conditions of work covering employees in the bargaining unit concerned.
The law gives primacy to free collective bargaining (Art. 211) and allows the parties to devise their bargaining rules (Art. 251). This is
When a number of employees join forces for purposes of collective bargaining, the unit structure is described as a multi-employer bargaining unit. The structure may consist of an association representing employers, or even a whole industry, or it may be composed of only a few employers who bargain as a group, or through an association. Competitive pressures are the dominant forces that encourage both unions and employers to enter into multi-employer or industry-wide bargaining relationships. Small employers in highly competitive and labor-intensive fields may find it easier to operate with uniformity of labor cost. The multi-employer unit is particularly advantageous to both sides in industries composed of many small, financially weak employers. Multi-employer bargaining provides both management and unions with significant cost savings in negotiation of labor agreements. It is cheaper to negotiate one master multi-employer agreement than a number of single-employer agreements. There are, however, other considerations than costs, such as intraorganizational issues, that the parties take into account before opting for multi-employer units. Multi-employer bargaining may not only overlook the needs of various employee groups, but also ignore particular requirements of individual employers.
LABOR RELATIONS What may be readily acceptable to one employer may be considered as financially disastrous by another. To arrive at multi-employer agreements is much more difficult than to arrive at single-employer contracts. The expanded size of the unit composed of many heterogeneous groups leads to intensive intraorganizational bargaining both on the union’s and on the employer’s side. At times, these intra-organizational pressures may lead to lengthy delays in negotiations and even to breakdown of bargaining.
(c) Each employer or concerned labor union shall express its willingness or refusal to participate in multi-employer bargaining in writing, addressed to its corresponding exclusive bargaining agent or employer. Negotiations may commence only with regard to respective employers and labor unions who consent to participate in multi-employer bargaining; (d) During the course of negotiations, consenting employers and the corresponding legitimate labor unions shall discuss and agree on the following: 1) the manner by which negotiations shall proceed;
7.2 Multi-employer Bargaining Procedure (D.O. No. 40-03) Section 5. When multi-employer bargaining available. - A legitimate labor union(s) and employers may agree in writing to come together for the purpose of collective bargaining, provided: (a) only legitimate labor unions who are incumbent exclusive bargaining agents may participate and negotiate in multi-employer bargaining; (b) only employers with counterpart legitimate labor unions who are incumbent bargaining agents may participate and negotiate in multi-employer bargaining; and (c) only those legitimate labor unions who pertain to employer units who consent to multi-employer bargaining may participate in multi-employer bargaining. Section 6. Procedure in multi-employer bargaining. - Multi-employer bargaining may be initiated by the labor unions or by the employers. (a) Legitimate labor unions who desire to negotiate with their employers collectively shall execute a written agreement among themselves, which shall contain the following: 1) the names of the labor unions who desire to avail of multi-employer bargaining; 2) each labor union in the employer unit; 3) the fact that each of the labor unions are the incumbent exclusive bargaining agents for their respective employer units; 4) the duration of the collective bargaining agreements, if any, entered into by each labor union with their respective employers. Legitimate labor unions who are members of the same registered federation, national, or industry union are exempt from execution of this written agreement. (b) The legitimate labor unions who desire to bargain with multi-employers shall send a written notice to this effect to each employer concerned. The written agreement stated in the preceding paragraph, or the certificates of registration of the federation, national, or industry union, shall accompany said notice. Employers who agree to group themselves or use their existing associations to engage in multiemployer bargaining shall send a written notice to each of their counterpart legitimate labor unions indicating their desire to engage in multi-employer bargaining. Said notice shall indicate the following: 1) the names of the employers who desire to avail of multi-employer bargaining; 2) their corresponding legitimate labor organizations; 3) the fact that each corresponding legitimate union is any incumbent exclusive bargaining agent; 4) the duration of the current collective bargaining agreement, if any, entered into by each employer with the counterpart legitimate labor union.
2) the scope and coverage of the negotiations and the agreement; and 3) where appropriate, the effect of the negotiations on current agreements or conditions of employment among the parties. Section 7. Posting and registration of collective bargaining agreement. - Two (2) signed copies of collective bargaining agreement reached through multiemployer bargaining shall be posted for at least five ( 5) days in two conspicuous areas in each workplace of the employer units concerned. Said collective bargaining agreement shall affect only those employees in the bargaining units who have ratified it. The same collective bargaining agreement shall be registered with the Department in accordance with the following Rule.
7.4 Optional Under D.O. No. 40-03 multi-employer bargaining is purely optional for employers and unions. Unlike other bargaining units, the multi-employer unit is based primarily on the consent of the firms involved. ________ Article 252. Meaning of duty to bargain collectively. – The duty to bargain collectively means the performance of a mutual obligation to meet and convene promptly and expeditiously in good faith for the purpose of negotiating an agreement with respect to wages, hours of work and all other terms and conditions of employment including proposals for adjusting any grievances or questions arising under such agreement and executing a contract incorporating such agreements if requested by either party but such duty does not compel any party to agree to a proposal or to make any concession. ________ Article 253. Duty to bargain collectively when there exists a collective bargaining agreement. – When there is a collective bargaining agreement, the duty to bargain collectively shall also mean that neither party shall terminate nor modify such agreement during its lifetime. However, either party can serve a written notice to terminate or modify the agreement at least sixty (60) days prior to its expiration date. It shall be the duty of both parties to keep the status quo and to continue in full force and effect the terms and conditions of the existing agreement during the 60-day period and/or until a new agreement is reached by the parties. ________ 1. DUTY TO BARGAIN DEFINED The law contemplates and defines two situations when the duty to bargain exists: Situation one, when there is yet no collective bargaining agreement (Art. 252), and Situation two, where a CBA exists (Art. 253).
For Situation One, the duty to bargain means in essence the mutual obligation of the employer and the employees’ majority union to meet and convene. The purposes of the meeting and convening are: (1) to negotiate an agreement on the subjects of:
LABOR RELATIONS The failure of refusal of an employer to bargain collectively with his employees constitutes an enjoinable unfair labor practice not only under the subdivision of the Act dealing expressly with “collective bargaining,” but also under the subsection making it an “unfair labor practice” to: “interfere with, restrain or coerce employees in the exercise” of their guaranteed rights, on the theory that refusal by an employer to bargain collectively with his employees constitutes “interference” with the latter’s right of self-organization.
(a) wages, (b) hours of work, and (c) all other terms and conditions of employment including proposals for adjusting grievances or questions arising under such agreement; and
2.1 Unresolved Petition for Union Cancellation
(2) to execute a contract incorporating such agreement if requested by either party.
If an employer is guilty of unfair labor practice when he directly discharges his employees to forestall a demand for collective bargaining, he certainly should not be allowed to evade responsibility if he indirectly causes that discharge by selling to a company that he knows is unwilling to accept his employees.
The kind of compliance required is prompt, expeditious, and in good faith. The limitations or reservations of the duty are that it does not compel any party to agree to a proposal or to make a concession. For Situation Two, the duty to bargain means all of the above and, additionally, the obligation not to terminate or modify the CBA during its lifetime. But 60 days before the CBA expires, either party may notify the other in writing that it desires to terminate or modify the agreement. During the 60-day period and until a new agreement is reached, the CBA remains in full force and effect; the parties are dutybound to keep the status quo. The law therefore provides for automatic renewal or extension of the CBA. This 60-day period under Art. 253 refers to submission of proposals to renegotiate the nonrepresentational provisions of the CBA. It does not always coincide with the 60-day period mentioned in Articles 253-A and 256 pertaining to “freedom period” to resolve representation contest between unions 1.1 Four Forms of ULP in Bargaining (1) failure to meet and convene; (2) evading the mandatory subjects of bargaining; (3) bad faith in bargaining, including failure or refusal to execute the collective agreement, if requested; and (4) gross violation of the CBA. 2. FIRST U.L.P. IN BARGAINING: FAILURE OR REFUSAL TO MEET AND CONVENE An employer is guilty of an unfair labor practice in refusing to bargain with the representative of a majority of his employees. To bargain in good faith, an employer must not only meet and confer with the union which represents his employees, but also must recognize the union for the purpose of collective bargaining. In addition, he must recognize the union as the bargaining representative of all the employees in the appropriate bargaining unit, even if they are not all members of the union. The duty to bargain extends beyond the period of contract negotiations, and applies to labor-management relations during the term of the agreement. Since a collective bargaining agreement does not define all the rights and obligations of the employer and his employees, negotiation of grievances is part and parcel of the bargaining process.
2.2 Selling the Company
The basic rule is that if the transfer of assets and employees from one employer to another leaves intact the identity of the employing enterprise, the transferor’s duty to recognize and bargain with an incumbent union devolves upon the transferee as “successor employer.” That means that an acquiring employer is a successor to the bargaining obligations of his predecessor if there is a continuity in the business operation. Only a high degree of enterprise continuity will justify imposing obligations under a contract with the union to which the new employer was not a party. A mere change in ownership of a business is insufficient to alter a union’s status as bargaining representative. 2.3 Successor Employer: Continuity and Identity In making the determination as to whether an employer is successor, the NLRB looks to the totality of circumstances to determine whether there has been a substantial and material alteration in the employing enterprise. If there is a substantial and material alteration in the employing enterprise, the new employer need not bargain with the incumbent union. 2.4 Conversion to Independent Franchise or Operation A decision to withdraw capital from a company-operated facility and relinquish the operating control to an independent dealership lies very much at the core of entrepreneurial control, and hence is not a mandatory subject of bargaining 2.5 Do Economic Exigencies Justify Refusal to Bargain? An employer has been held not guilty of a refusal to bargain by adamantly rejecting the union’s economic demands where he is operating at a loss, on a low profit margin, or in a depressed industry, as long as he continues to negotiate. 2.6 Acts not Deemed Refusal to Bargain The duty to bargain is not violated by: (1) adoption of an adamant bargaining position in good faith, particularly when the company is operating at a loss;
LABOR RELATIONS (2) refusal to bargain over demands for commission of unfair labor practices;
with impunity to resort to schemes feigning negotiations by going through empty gestures.”
(3) refusal to bargain during period of illegal strike.
3. SECOND U.L.P. IN MANDATORY SUBJECTS
If a union engages in an illegal strike, the employer has no obligation to bargain until he is notified that the illegal strike has been terminated. Where, pursuant to an honest doubt, the employer has demanded additional proof or acquisition of an official certification of bargaining agency, there is no obligation or duty on the employer’s part to enter into negotiations until the demanded proof is presented pending the certification proceedings, unless it can be established that the demand lacks in good faith and is intended as an obstruction to negotiations. Neither is the duty to bargain violated where: (1) there is no request for bargaining; (2) the union seeks recognition for an inappropriately large unit; (3) the union seeks to represent some persons who are excluded from the Act; (4) the rank-and-file unit includes supervisors or inappropriate otherwise; (5) the demand for recognition and bargaining is made within the year following a certification election in which the clear choice was no union and no ad interim significant change has taken place in the unit; (6) the union makes unlawful bargaining demands. 2.7 Alleged Interference in the Selection of the Union’s Negotiation Panel In order to show that the employer committed ULP under the Labor Code, substantial evidence is required to support the claim. Substantial evidence has been defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.
It is the obligation of the employer and the employees’ representative to bargain with each other with respect to “wages, hours, and other terms and conditions of employment.” They are statutory or “mandatory” proposals. An employer’s refusal to negotiate a mandatory subject of bargaining is an unfair labor practice although the employer has every desire to reach agreement and earnestly and in all good faith bargains to that end. On the other hand, an employer’s duty to bargain is limited to the mandatory bargaining subjects; as to other matters, he is free to bargain or not to bargain. A mere remote, direct, or incidental impact is insufficient to render a subject a mandatory subject of bargaining; in order for a matter to be subject to mandatory collective bargaining, it must materially or significantly affect the terms or conditions of employment. 3.1 Wages and Employment Conditions The term “wages,” as used in 29 USCS Sec. 158(d), has been held to include not only compensation but also other emoluments of value furnished by the employer to his employees. Under our Labor Code, “wage” refers to remuneration or earnings, however designated, capable of being expressed in terms of money, etc. Since the passage of the Taft-Hartley Act, the National Labor Relations Board has held that industrial pensions, group insurance, and merit increases all are matters about which employers must bargain collectively.
The following are examples of matters considered as mandatory subjects of bargaining: (1) Wages and other types of compensation, including merit increases; (2) Working hours and working days, including work shifts; (3) Vacations and holidays;
2.8 Non-reply to Proposal; CBA Imposed on Employer
Collective bargaining, designed to stabilize the relation between labor and management and to create a climate of sound and stable industrial peace. It is a legal obligation, so much so that Article 248 of the Labor Code makes it an unfair labor practice for an employer to refuse "to meet and convene promptly and expeditiously in good faith for the purpose of negotiating an agreement with respect to wages, hours of work, and all other terms and conditions of employment.
(5) Pensions and retirement plans;
We agree with the pronouncement that it is not obligatory upon either side of a labor controversy to precipitately accept or agree to the proposals of the other. But an erring party should not be tolerated and allowed with impunity to resort to schemes feigning negotiations by going through empty gestures.
(6) Seniority; (7) Transfer; (8) Lay-offs; (9) Employee workloads; (10) Work rules and regulations;
2.8a Repetition in Divine Word University
(11) Rent of company houses;
“A company’s refusal to make counter proposal if considered in relation to the entire bargaining process, may indicate bad faith and this is especially true where the Union’s request for a counter proposal is left unanswered.” Moreover, the Court added in the same case that “it is not obligatory upon either side of a labor controversy to precipitately accept or agree to the proposals of the other. But an erring party should not be tolerated and allowed
(12) Union security arrangements. 3.1a Wage Agreement; “Solomonic” Approach
LABOR RELATIONS We take note of the "middle ground" approach employed by the Secretary in this case which. we do not necessarily find to be the best method of resolving a wage dispute. Merely finding the midway point between the demands of the company and the union, and "splitting the difference" is a simplistic solution that fails to recognize that the parties may already be at the limits of the wage levels they can afford. It may lead to the danger too that neither of the parties will engage in principled bargaining; the company may keep its position artificially low while the union presents an artificially high position, on the fear that a "Solomonic" solution cannot be avoided. Thus, rather than encourage agreement, a "middle ground approach" instead promotes a "play safe" attitude that leads to more deadlocks than to successfully negotiated CBAs.
An employer’s statutory duty to bargain requires him to negotiate over the union’s proposal that their agreement include a clause binding him not to lock out the employees. An employer’s refusal to bargaining over the duration of the contract to be entered into is also an unfair labor practice. But an employer’s obligation to enter into a collective bargaining agreement does not require that the employer enter into an unalterable obligation for an extended period of time, and many collective bargaining agreements contain a clause permitting termination or modification by either party upon prescribed notice.
3.2 Workloads and Work Rules
3.7 Signing Bonus
Employee workloads are a mandatory subject of bargaining. Employer rules concerning coffee breaks, lunch periods, smoking, employee discipline, and dress are also mandatory subjects of bargaining, as are plant safety rules and general regulations.
Signing bonus is a grant motivated by goodwill created when a CBA is successfully negotiated and signed between the employer and the union. Where goodwill does not exist, why ask for a signing bonus?
Company rules relating to safety and work practices come within the meaning of the phrase “other terms and conditions of employment” as used in the Act and, therefore, constitute a mandatory subject of collective bargaining. 3.2a Code of Conduct Work rules and regulations are commonly compiled into a booklet usually called “Code of Discipline” or “Code of Conduct.” Such dos and don’ts for employees of the enterprise are work rules, forming part of terms and conditions of employment, that are proper subjects of collective bargaining. Hardly may the employer contend that they are “non-negotiable” matters. 3.3 Management Prerogatives Clause An employer does not commit an unfair labor practice by insisting, to the point of a bargaining impasse, on the inclusion in the contract of a management prerogatives clause, even though some of the matters covered by the clause are “conditions of employment” which are mandatory subjects of bargaining under 29 USCS Sec. 158(d). Thus, an employer’s insistence that its decisions regarding hiring and tenure of employment should not be reviewable by arbitration is not a refusal to bargain. 3.4 Union Discipline Clause An employer may bargain to an impasse over his proposal that the union eliminate a piecework ceiling imposed by a union rule which subjects members to discipline for exceeding the production quota. However, an employer’s insistence to the point of a bargaining impasse on the union’s withdrawal of fines imposed on memberemployees who crossed a picket line around the employer’s plant is an unlawful refusal to bargain, since the right not to withdraw fines is an internal union affairs, a matter involving relations between employees and their unions, and therefore not a mandatory bargaining item. 3.5 Arbitration, Strike-Vote, or No-Strike Clause An employer may lawfully bargain to an impasse over his proposal that the collective bargaining agreement include an arbitration clause or a no-strike clause which prohibits the employees from striking during the life of the agreement. 3.6 No-Lockout Clause; Clause Fixing Contractual Term
In contractual terms, a signing bonus is justified by and is the consideration paid for the goodwill that existed in the negotiations that culminated in the signing of a CBA. Without the goodwill, the payment of a signing bonus cannot be justified and any order for such payment, to our mind, constitutes grave abuse of discretion.
In short, if the reason behind a signing bonus is absent, no signing bonus need be given. 3.8 No Duty to Agree Even on Mandatory Subjects The Act does not compel agreements between employers and employees, and neither party is legally obligated to yield even on a mandatory bargaining subject. Where the subject of the dispute is a mandatory bargaining subject, either party may bargain to an impasse as long as he bargains in good faith. The duty to bargain does not obligate a party to make concessions or yield a position fairly held. Hence, an employer’s adamant insistence on a bargaining position is not necessarily a refusal to bargain in good faith. Even if the negotiating party thumbs down the other party’s proposals, there is no violation of the duty to bargain—hence, no ULP—as long as the negative reply can be explained in good faith. 3.9 Non-mandatory Subjects An employer cannot insist, to the point of creating a bargaining impasse, on the inclusion of a provision outside the scope of the statutory bargaining subjects, even if he acts in good faith. On the other hand, it is lawful to insist on the inclusion of a provision in a collective bargaining agreement if the provision is within the scope of a statutory subject of bargaining. An employer bargains to an impasse over a non-mandatory bargaining subject when he refuses to reach any agreement with the union unless the union capitulates to him on that subject. However, it has been held that a bargaining impasse may be reached over a non-mandatory bargaining subject although that subject is not the sole cause for the parties’ failure to agree. When a subject under discussion is not mandatory, it may be discussed if both parties agree, but a strike or lockout may not be used to compel a negotiation or agreement. While most matters that might be discussed or proposed in collective bargaining are likely to bear some relation, even if tenuous, to “wage, hours, and other terms and conditions of employment,” not all proposals that somehow respond to a problem that is customarily bargained about may themselves be insisted upon to impasse. By once
bargaining and agreeing on a permissive subject of bargaining, the parties do not make the subject a mandatory topic of future bargaining.
LABOR RELATIONS Deadlock does not mean the end of bargaining. It signals rather the need to continue the bargaining with the assistance of a third party as conciliator or arbitrator whose first aim is to get the parties back to the negotiating table and help them craft a win-win solution.
3.10 Bargaining to the Point of Impasse: Not necessarily Bad Faith 3.11b Strike or Lockout in Case of Deadlock The adamant insistence on a bargaining position to the point where the negotiations reach an impasse does not establish bad faith. Neither can bad faith be inferred from a party’s insistence on the inclusion of a particular substantive provision unless it concerns trivial matters or is obviously intolerable. The question as to what are mandatory and what are merely permissive subjects of collective bargaining is of significance on the right of a party to insist on his position to the point of stalemate. A party may refuse to enter into a collective bargaining contract unless it includes a desired provision as to a matter which is a mandatory subject of collective bargaining; but a refusal to contract unless the agreement covers a matter which is not a mandatory subject is in substance a refusal to bargain about matters which are mandatory subjects of collective bargaining, and it is no answer to the charge of refusal to bargain in good faith that the insistence on the disputed clause was not the sole cause of the failure to agree or that agreement was not reached with respect to other disputed clauses.
Stated in another way, the ruling means that bargaining to the point of deadlock may or may not amount to bargaining in bad faith depending on whether the insistence refers to a mandatory or a non-mandatory subject of bargaining. The reason is that the duty to bargain requires meeting and convening on terms and conditions of employment but does not require assent to the other party’s proposals. Over a non-mandatory subject, on the other hand, a party may not insist on bargaining to the point of impasse, otherwise his insistence can be construed as bargaining in bad faith. It may be construed as evasion of the duty to bargain; such evasion is ULP. The above rulings do not mean that non-mandatory subjects cannot be proposed or that the proponent cannot demand serious discussion of such proposal. What the rulings forbid is the posture of making settlement on a non-mandatory subject a precondition to the discussion or settlement of a mandatory subject. If a non-mandatory subject is proposed and agreed upon, the agreeing party, by itself, is binding. 3.11 When Is There Deadlock or Impasse? A bargaining impasse over an issue exists where good faith bargaining on the part of the parties has failed to resolve the issue and there are no definite plans for further efforts to break the deadlock. “Impasse,” within the meaning of the federal labor laws, presupposes reasonable effort at good faith bargaining which, despite noble intentions, does not conclude in an agreement between the parties. In the NLRB’s view, whether a bargaining impasse exists is a matter of judgment dependent on such factors as the bargaining history, the parties’ good faith in negotiations, the length of the negotiations, the importance of the issue or issues as to which there is disagreement, and the contemporaneous understanding of the parties as to the state of negotiations. 3.11a Duty to Bargain When There Is Deadlock or Impasse
Bargaining may proceed smoothly—and this is the wish of most negotiation panels—but it may also be marred by insinuations, misunderstandings, and apparently irreconcilable bargaining positions. Deadlock develops. In fact, deadlock may occur anytime for various reasons such as unacceptability of a proposal or counter proposal, grandstanding of a negotiator, autocratic or arrogant stance, or imprecise wording of a stipulation. The law (Art. 263) recognizes bargaining deadlock as a valid reason to declare a strike or lockout. Strike/ lockout presents a major deviation from the preferred smooth route of bargaining. At this point of bargaining scenario, strike/ lockout is supposed to be a method of resolving an impasse, a device to constrain the parties to end an impasse and go back to the negotiation table. But strike/ lockout, while meant to be a solution, frequently becomes a problem in itself. Although the union's petition was for "compulsory arbitration," the subsequent agreement of petitioner to submit the matter for arbitration in effect made the arbitration a voluntary one. The essence of voluntary arbitration, after all, is that it is by agreement of the parties, rather than compulsion of law, that a matter is submitted for arbitration. It does not matter that the person chosen as arbitrator is a labor arbiter who, under Art. 217 of the Labor Code, is charged with the compulsory arbitration of certain labor cases. There is nothing in the law that prohibits these labor arbiters from also acting as voluntary arbitrators as long as the parties agree to have him hear and decide their dispute.
4. THIRD U.L.P. IN BARGAINING: BAD FAITH Bargaining deadlock may be precipitated not only by hard-line positions on mandatory or non-mandatory subjects. It may also arise because of lack of good faith in bargaining. Good-faith bargaining demands more than sterile and repetitive discussion of formalities precluding actual negotiation, more than formal replies which constitute in effect a refusal to treat with the union, and more than a willingness to enter upon a sterile discussion of union-management differences. It requires a sincere effort to reach agreement, although it does not require agreement itself. Moreover, the duty to bargain does not end with the negotiation of the agreement. The duty to bargain collectively may be violated without a general failure of subjective good faith, and there is no occasion to consider the issue of good faith if a party refuses even to negotiate in fact about any of the mandatory subjects. AN employer cannot be guilty of a refusal to bargain if the union is not itself bargaining in good faith. 4.1 Determination of Good Faith The crucial question whether or not a party has met his statutory duty to bargain in good faith typically turns on the facts of the individual case. There is no per se test of good faith in bargaining. Good faith or bad faith is an inference to be drawn from the facts and is largely a matter for the NLRB’s expertise. To some degree, the question of good faith may be a question of credibility.
A fair criterion of good faith in collective bargaining requires that the parties involved deal with each other with open and fair mind and
sincerely endeavor to overcome obstacles or difficulties existing between them to the end that employment relations may be established and obstruction to the free flow of commerce prevented. Mere pretended bargaining will not suffice; neither must the mind be hermetically sealed against the thought of entering into an agreement. To do less that is required by the standards of good faith and conduct is a refusal to bargain collectively and violates the spirit and intent of the Act. 4.2 When Can Bargaining in Bad Faith Occur? Bargaining in bad faith is considered ULP under Art, 248(g). But if one will be charged with bargaining in bad faith, the charge should be raised while the bargaining is in progress. When the bargaining is finished and the CBA has been executed voluntarily by the parties, a charge of bargaining in bad faith is too late and untenable. With the execution of the CBA, bad faith bargaining can no longer be imputed upon any of the parties thereto. All provisions in the CBA are supposed to have been jointly and voluntarily incorporated therein by the parties. This is not a case where private respondent exhibited an indifferent attitude towards collective bargaining because the negotiations were not the unilateral activity of petitioner union. The CBA is proof enough that private respondent exerted "reasonable effort at good faith bargaining." The union’s proposal, not being part of the signed contract, cannot serve as basis of holding the management guilty of bad faith in bargaining or in implementing their contract as signed.
4.3 Instances of Bad Faith: Delay of, or Imposing Time Limit on, Negotiations An unwarranted delay in negotiations may be evidence of bad faith on the part of the employer. However, an employer has been held not guilty of bad faith for failing to complete a collective bargaining contract during a 3-year period, where many conferences had been held during the period, even though the employer had insisted on a no-strike clause and had raised wages during negotiations for the purpose of meeting competition. The National Labor Relations Board of the United States reported that “lack of good faith is indicated where the employer engages in unfair labor practices while bargaining with the union; where it engages in dilatory tactics during negotiations; or where it institutes a wage cut by unilateral action and without consulting the majority representative.” Nonetheless, the prior adjudication of bad faith on an earlier occasion is not itself substantial evidence of present bad faith. As the Court held in the case of Kiok Loy v. NLRC, 141 SCRA 179, 186 (1986), the company's refusal to make counter-proposal to the union's proposed CBA is an indication of its bad faith.
4.3a Bad Faith: Surface Bargaining; Shifting Bargaining Positions; Blue Sky Bargaining “Surface bargaining,” which means a sophisticated pretense in the form of apparent bargaining, does not satisfy the statutory duty to bargain. The duty is not discharged by merely meeting together or simply manifesting a willingness to talk. It requires more than a willingness to enter upon a sterile discussion of union-management differences. Collective bargaining is not simply an occasion for purely formal meetings between management and labor while each maintains
LABOR RELATIONS an attitude of “take it or leave it,” but presupposes a desire to reach an ultimate agreement to enter into a collective bargaining contract. An employer’s proposals which could not be offered with any reasonable expectation that they would be accepted by the union constitute surface bargaining. Repeated shifts in position and attitude on the part of an employer whenever a tentative agreement is reached are evidence of a refusal to bargain collectively in good faith. It has also been held that an employer cannot reject a union’s acceptance of the employer’s counter offer on the ground that the union had earlier rejected the offer. Surface bargaining is defined as "going through the motions of negotiating" without any legal intent to reach an agreement. The resolution of surface bargaining allegations never presents an easy issue. The determination of whether a party has engaged in unlawful surface bargaining is usually a difficult one because it involves, at bottom, a question of the intent of the party in question, and usually such intent can only be inferred from the totality of the challenged party’s conduct both at and away from the bargaining table. It involves the question of whether an employer’s conduct demonstrates an unwillingness to bargain in good faith or is merely hard bargaining. x x x We, likewise, do not agree that the Union is guilty of ULP for engaging in blue-sky bargaining or making exaggerated or unreasonable proposals.
4.3b Bad Faith: Inflexible Demands; Strike Amid Negotiation 4.3c Bad Faith: Boulwarism; Take-It-or-Leave-It Bargaining The new plan was threefold. As negotiations approached, the Company would use its local management personnel on the desires of the work force on the type and level of benefits; these were then translated into specific proposals, whose cost and effectiveness were researched in order to determine an attractive bargaining offer within the Company's means; the Company then attempted to "sell" its proposals to its employees and the general public through a publicity campaign in plant newspapers, bulletins, letters, television and radio announcements and personal contacts. The Company announced in negotiations that it rejected the usual “horse trading” approach to bargaining, with each side eventually compromising initial unreasonable positions; it advertised its initial proposals as “fair” and “firm.” Though willing to accept Union suggestions based on facts it might have overlooked, the Company refused to change its position simply because the Union disagreed with it. We have already indicated that one of the central tenets of "the Boulware approach" is that the "product" or "firm, fair offer" must be marketed vigorously to the "consumers" or employees, to convince them that the Company, and not the Union, is their true representative. The aim, in a word, was to deal with the Union through the employees, rather than with the employees through the Union.
4.4 Not Bad Faith to Propose Modifications to the Expiring CBA It is not bad-faith bargaining when a party proposes modifications to the expiring CBA. The second sentence of Article 253 explicitly refers to serving a written notice “to terminate or modify” the agreement. Modification may mean addition to, subtraction from, or other ways of changing the contents or phraseology of contents of the expiring CBA. It does not connote a one-direction movement. But whichever way it is proposed to go, the proposed changes require honest explanation. What was excluded from the old CBA may be proposed for inclusion in the forthcoming CBA, or vice-versa. Negotiation precisely contemplates proposals and counter-proposals. 4.5 Giving of Information
LABOR RELATIONS Part of good-faith bargaining, and a method to expedite the process, is supplying of information to the other party, as required by law. It should be recalled that under Art. 242 one of the rights of a legitimate labor organization which is certified as the exclusive bargaining agent, is to ask for and be furnished with the employer’s annual audited financial statements, including the balance sheet and the profit and loss statement. Such information is crucial in bargaining. An employer is under a duty, upon request of the bargaining representative, to provide information relevant to the issues at the bargaining table. Refusal to provide relevant information after the same has been requested constitutes per se violation of the duty to bargain. Relevant information or data may include information concerning the employees in the bargaining unit, such as their names, addresses, and seniority standing, or concerning the financial status of the employer, especially where needed to substantiate claims of inability to pay. 5. FOURTH U.L.P. IN BARGAINING: GROSS VIOLATION OF THE CONTRACT At this stage, the negotiations are over; the document has been signed, sealed, and delivered. Implementation should follow. But at this stage the collective bargaining process is not yet over, and the duty to bargain is still operative because such duty further requires faithful adherence to the contractual provisions. Violation of the contract amounts to ULP, if the violation is “gross.” 6. RATIFICATION REQUIREMENTS
The agreement negotiated by the employees’ bargaining agent should be ratified or approved by the majority of all the workers in the bargaining unit. The proper ratifying group is not just the majority union but the majority of all the workers in the bargaining unit represented in the negotiation. The ratification and the manner of doing it are mandatory.
In any of those situations the CBA still needs to be posted in two conspicuous places in the workplace, but the posting is for the information of, and not ratification by, the employees affected. Moreover, the CBA has to be registered with the DOLE regional office. To require ratification of the CBA in case of arbitral awards will be inconsistent with the nature of arbitration as a dispute-settlement device. The preceding comment, however, does not mean that the arbitral award is beyond question. Certiorari on proper grounds is available. 6.3 Ratified but Unsigned Lack of the purely ministerial act of signing the formal contract did not obviate the fact that there was a binding contract. 6.4 Unratified but Implemented The parties to a collective agreement are required to furnish copies to the appropriate Regional Office with accompanying proof of ratification by the majority of all the workers in the bargaining unit. This was not done in the case at bar. But we do not declare the CBA invalid or void considering that the employees have enjoyed benefits from it. They cannot receive benefits under provisions favorable to them and later insist that the CBA is void simply because other provisions turn out not to the liking of certain employees. It is iniquitous to receive benefits from a CBA and later on disclaim its validity.
7. EXECUTION OF CONTRACT A party to a collective bargaining may be required to sign a contract where the agreement has been reached by the parties and only one party’s refusal to execute a contract is preventing its being carried into effect. Such refusal is an unfair labor practice 7.1 Unwritten or Unsigned Agreement American courts have held that a collective bargaining agreement is valid though not reduced to writing or signed, if neither party requests a written instrument.
The Implementing Rules require posting of the CBA in two conspicuous places for five days. In one case, the CBA was not posted for at least five days in two conspicuous places in the establishment before ratification, to enable the workers to clearly inform themselves of its provisions. Moreover, the CBA submitted to the MOLE did not carry the sworn statement of the union secretary, attested by the union president, that the CBA had been duly posted and ratified, as required by the Implementing Rules and Regulations. The court ruled that these requirements being mandatory, non-compliance therewith rendered the said CBA ineffective.
7.2 Effect of Signing on Other Disputes
6.1 Invalid Ratification
It is believed that failure to register the CBA does not make it invalid or unenforceable. Its non-registration, however, renders the contractbar rule inoperative.
6.2 When Ratification Not Needed Ratification of the CBA by the employees in the bargaining unit is not needed when the CBA is a product of an arbitral award by appropriate government authority or by a voluntary arbitrator. The arbitral award may result from voluntary arbitration under Art.262 or from the secretary’s assumption of jurisdiction or certification of the dispute to the NLRC, under Art. 263(g).
8. REGISTRATION OF C.B.A. The collective agreement, having been properly ratified, should be registered with the DOLE Regional Office where the bargaining union is registered or where it principally operates. Art. 231 requires the registration within thirty (3) calendar days from execution of the agreement. Multi-employer collective bargaining agreements shall be filed with the Bureau.
8.1 Requirements for Registration Section 2. Requirements for registration. - The application for CBA registration shall be accompanied by the original and two (2) duplicate copies of the following documents which must be certified under oath by the representative(s) of the employer(s) and labor union(s) concerned
LABOR RELATIONS (a) the collective bargaining agreement; (b) a statement that the collective bargaining agreement was posted in at least two (2) conspicuous places in the establishment or establishments concerned for at least five (5) days before its ratification; and (c) a statement that the collective bargaining agreement was ratified by the majority of the employees in the bargaining unit of the employer or employers concerned. No other document shall be required in the registration of collective bargaining agreements
The application may be denied if the supporting documents are incomplete or not verified under oath. The denial, if by the Regional office, is appealable to the Bureau within ten (10) days or to the Secretary if the denial is by the Bureau. 9. AUTOMATIC RENEWAL OF CBA The parties shall continue the CBA in “full force and effect” until they reach a new agreement. It is clear from the above provision of law that until a new Collective Bargaining Agreement has been executed by and between the parties, they are duty-bound to keep the status quo and to continue in full force and effect the terms and conditions of the existing agreement. The law does not provide for any exception nor qualification as to which of the economic provisions of the existing agreement are to retain force and effect, therefore, it must be understood as encompassing all the terms and conditions in the said agreement.
________ Article 253-A. Terms of a collective bargaining agreement. – Any Collective Bargaining Agreement that the parties may enter into shall, insofar as the representation aspect is concerned, be for a term of five (5) years. No petition questioning the majority status of the incumbent bargaining agent shall be entertained and no certification election shall be conducted by the Department of Labor and Employment outside of the sixty-day period immediately before the date of expiry of such five-year term of the Collective Bargaining Agreement. All other provisions of the Collective Bargaining Agreement shall be renegotiated not later than three (3) years after its execution. Any agreement on such other provisions of the Collective Bargaining Agreement entered into within six (6) months from the date of expiry of the term of such other provisions as fixed in such Collective Bargaining Agreement, shall retroact to the day immediately following such date. If any such agreement is entered into beyond six months, the parties shall agree on the duration of retroactivity thereof. In case of a deadlock in the renegotiation of the Collective Bargaining Agreement, the parties may exercise their rights under this Code. (As amended by Section 21, Republic Act No. 6715, March 21, 1989). ________ 1. DURATION OF A C.B.A. RA No. 9715 (March 21, 2989) has introduced through Art. 253-A a significant change in setting the durations or terms of a CBA at five years for the “representation aspect” and not more than three years for “all other provisions.” The “representation aspect” refers to the identity and majority status of the union that negotiated the CBA as the exclusive representative of the bargaining unit. “All other provisions: simply refers to the rest of the CBA, economic as well as non-economic other than representational.
The conference agreed to make the “terms and conditions” or “economic” provision of the CBA good only for three years so as to protect the economic gains of the workers. Obviously, the framers of the law wanted to maintain industrial peace and stability by having both management and labor work harmoniously together without any disturbance. Thus, no outside union can enter the establishment within five (5) years and challenge the status of the incumbent union as the exclusive bargaining agent. Likewise, the terms and conditions of employment (economic and non-economic) cannot be questioned by the employers or employees during the period of effectivity of the CBA. The CBA is a contract between the parties and the parties must respect the terms and conditions of the agreement. Notably, the framers of the law did not give a fixed term as to the effectivity of the terms and conditions of employment. It can be gleaned from their discussions that it was left to the parties to fix the period. The issue as to the term of the non-representation provisions of the CBA need not belabored especially when we take note of the Memorandum of the Secretary of Labor dated February 24, 1994. In said memorandum, the Secretary of Labor had occasion to clarify the term of the renegotiated terms of the CBA vis-a-vis the term of the bargaining agent, to wit: As a matter of policy the parties are encourages (sic) to enter into a renegotiated CBA with a term which would coincide (sic) with the aforesaid five (5) year term of the bargaining representative. In the event however, that the parties, by mutual agreement, enter into a renegotiated contract with a term of three (3) years or one which does not coincide with the said 5-year term, and said agreement is ratified by majority of the members in the bargaining unit, the subject contract is valid and legal and therefore, binds the contracting parties. The same will however not adversely affect the right of another union to challenge the majority status of the incumbent bargaining agent within sixty (60) days before the lapse of the original five (5) year term of the CBA.
2. EFFECTIVITY AND RETROACTIVITY OF A C.B.A. If the CBA is the very first for the bargaining unit, the Code does not state any rule on the CBA’s effectivity date. The parties have to decide it for themselves. But if the ensuing CBA is renewal, modification or renegotiation of an expiring one, the Code offers a formula for the effectivity date. Article 253-A provides that the ensuing agreement, if entered into within six (6) months from expiry of the old one, shall retroact to the date following such expiry date; thus, if the CBA expired on December 31 and the new one is concluded on, say, March 31, its effectivity date is January 1. If, on the other hand, the new agreement is concluded after June 30, then the matter of retroaction and the possible retroactive date are left to the parties. When, precisely, is the date an agreement is “concluded” or “entered into”? The determining point is the date the parties agreed, not the date they signed. Art. 253-A refers merely to an "agreement" which, according to Black's Law Dictionary is "a coming together of minds; the coming together in accord of two minds on a given proposition." This is similar to Art. 1305 of the Civil Code's definition of "contract" as "a meeting of minds between two persons." The two terms, "agreement" and "contract," are indeed similar, although the former is broader than the latter because an agreement may not have all the elements of a contract. As in the case of contracts, however, agreements may be oral or written. Hence, even without any written evidence of the Collective Bargaining Agreement made by the parties, a valid agreement existed in this case from the moment the minds of the parties met on all matters they set out to discuss, as provided under Art. 1315 of the Civil Code.
2.1 Effectivity of CBA Concluded After Six Months from Expiration of Old CBA Significantly, the law does not specifically cover the situation where six months have elapsed but the parties have reached no agreement with respect to effectivity. In this eventuality, we hold that any provision of law should then apply, for the law abhors a vacuum. One such provision is the principle of hold over, i.e., that in the absence of a new CBA, the parties must maintain the status quo and must continue in full force and effect the terms and conditions of the existing agreement until a new agreement is reached. In this manner, the law prevents the existence of a gap in the relationship between the collective bargaining parties. Another legal principle that should apply is that in the absence of an agreement between the parties, then, an arbitrated CBA takes on the nature of any judicial or quasijudicial award; it operates and may be executed only prospectively unless there are legal justifications for its retroactive application.
3. EXTENSION OF EFFECTIVITY OF C.B.A., WHEN VALID 3.1 Ten-Year Suspension of CBA ________ Article 254. Injunction prohibited. – No temporary or permanent injunction or restraining order in any case involving or growing out of labor disputes shall be issued by any court or other entity, except as otherwise provided in Articles 218 and 264 of this Code. (As amended by Batas Pambansa Bilang 227, June 1, 1982). ________ 1. NO-INJUNCTION POLICY An injunction may require or restrain the doing of an act. Article 254 announces the policy that labor disputes are generally not subject to injunction. If the rule were otherwise, it would contradict the declared policy, under Article 211(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.” The policy, basically, is freedom at the workplace. The law, true to the tenets of free enterprise system, allows management and labor to fashion the contents and incidents of their relationship. If there is dispute between the parties, the responsibility to solve it devolves upon them primarily, not upon the government. Government intervention is the exception rather than the rule. This anti-injunction policy applies even as regards wage-fixing by the wage commission or regional wage boards. Moreover, any injunctive order in “non-national interest” disputes can be directed only against the illegal acts being committed in connection with the labor dispute; it cannot be directed against the dispute itself. There is no power the exercise of which is more delicate which requires grater caution, deliberation, and sound discretion, or (which is) more dangerous in a doubtful case than the issuing of an injunction; it is the strong arm of equity that never ought to be extended unless to cases of great injury, where courts of law cannot afford an adequate or commensurate remedy in damages. The right must be clear, the injury impending or threatened, so as to be averted only by protection preventive process of injunction.
1.1 Reason of the No-Injunction Policy
LABOR RELATIONS The labor injunction is an employer’s most effective remedy in labor dispute. However narrow its scope and form, the issuance of an injunction for any purpose in a labor dispute will generally tip the scales of the controversy. The issuance of an injunction in the early phases of a strike can critically sway the balance of the economic struggle against the union. Enforced by the court’s contempt powers, even a preliminary injunction is an effectual strike-breaking weapon because so much time ordinarily elapses between the issuance of a preliminary injunction and the time when a final decree can be reviewed on appeal. 1.2 Injunction Issued by Regular Court, When Proper Regular courts are without authority to issue injunction orders in cases involving or originating from labor disputes even if the complaint was filed by non-striking employees and the employer was also made a respondent to the action or even if the complainant was a customer of the strike-bound employer or a sister company of the strike-bound employer, whose premises were picketed by the strikers. The court may issue an injunction, whether temporary or permanent, as provided in said section of Republic Act 875, only in a case involving or growing out of a labor dispute.
________ Article 255. Exclusive bargaining representation and workers’ participation in policy and decision-making. – The labor organization designated or selected by the majority of the employees in an appropriate collective bargaining unit shall be the exclusive representative of the employees in such unit for the purpose of collective bargaining. However, an individual employee or group of employees shall have the right at any time to present grievances to their employer. Any provision of law to the contrary notwithstanding, workers shall have the right, subject to such rules and regulations as the Secretary of Labor and Employment may promulgate, to participate in policy and decision-making processes of the establishment where they are employed insofar as said processes will directly affect their rights, benefits and welfare. For this purpose, workers and employers may form labor-management councils: Provided, That the representatives of the workers in such labor-management councils shall be elected by at least the majority of all employees in said establishment. (As amended by Section 22, Republic Act No. 6715, March 21, 1989). ________ 1. WORKERS’ PARTICIPATORY CONSTITUTIONAL MEANING
The crucial question is: what is the meaning or extent of the workers’ right to participate in policy and decision-making? Enlightening in this regard are the deliberations of the 1986 Constitutional Commission. They reveal that the intention was to refer to participation in grievance procedures and voluntary modes of settling disputes and not to formulation of corporate programs or policies. There are three levels in which employees could influence management in their decision-making, and one would be at the corporate level. This would refer to strategic policies pertaining to the mergers, acquisitions, pricing and marketing policies, disposition of profits and the like. The second level would be the plant or
department level. It is here where administrative decisions are made. Decisions made in this level may refer to hiring, firing, and promotion of employees, cost and quality control, resource allocations, achievement of target quotas, etc. And the third will be the shop-floor level. It is here where the so-called operating decisions are made. Decisions made in this level usually refer to scheduling of work, safety regulations, work methods, training of new employees. So these are the different levels in which we hope there would be this democratic participation of workers in vital issues that affect both management and the workers. 1.1 Employees’ Participation in Formulating the Code of Discipline Indeed, it was only on March 2, 1989, with the approval of Republic Act No. 6715, amending Article 211 of the Labor Code, that the law explicitly considered it a State policy "(t)o ensure the participation of workers in decision and policy-making processes affecting the rights, duties and welfare." However, even in the absence of said clear provision of law, the exercise of management prerogatives was never considered boundless. Verily, a line must be drawn between management prerogatives regarding business operations per se and those which affect the rights of the employees. In treating the latter, management should see to it that its employees are at least properly informed of its decisions or modes action.
2. WORKERS’ PARTICIPATION AS THE REAL OBJECTIVE; THE LMC Article 255 deals with the crucial concept of employee participation. The law, while promoting collective bargaining, really aims at employee participation in policy and decision-making. Collective Bargaining is just one of the forms of employee participation. Despite so much interest in and promotion of collective bargaining, it is incorrect to say that the device which secures industrial democracy is collective bargaining and no other. And it is equally misleading to say that collective bargaining is the end-goal of employee representation. Rather, the real aim is employee participation in whatever form it may appear—bargaining or no bargaining, union or no union. This is why Art. 255, second sentence, reserves the right of an individual employee or group of employees (unionized or ununionized, or inside or outside a union) to present grievances to their employer at any time. Effectively voicing one’s grievance is reserved and hallowed by law, with or without collective bargaining. But individual representation in dealing or bargaining with the employer is weak. For this reason the law provides another forum— the labor-management council aside from or instead of a union. An LMC is versatile. It can exist where there is no union or co-exist with a union. One thing it cannot and must not do is to replace a union. While a labor union is hamstrung by such legal prescriptions as formal registration, limited bargaining unit, majority status, mandatory and non-mandatory subjects, etc., an LMC need not be held back by any of these. It can represent employees across the enterprise, present grievances regardless of the grievant’s rank, and proffer proposals unhindered by formalities. It can also handle projects and programs whoever is the proponent, form committees for myriad purposes, instill discipline and improve productivity. The LMC, in short, can deal with the employer on matters affecting the employees’ rights, benefits and welfare. “Dealing with the employer,” we have seen, is broader, freer, and (from the employer’s viewpoint) less threatening method than collective bargaining.
LABOR RELATIONS 2.1 Department’s Promotion of LMC and Other Councils Section 1. Creation of labor-management and other councils. - The Department shall promote the formation of labor-management councils in organized and unorganized establishments to enable the workers to participate in policy and decision-making processes in the establishment, insofar as said processes will directly affect their rights, benefits and welfare, except those which are covered by collective bargaining agreements or are traditional areas of bargaining.
3. INDIVIDUAL GRIEVANCE As briefly indicated above, the presence of an employees’ organization,--a union, an LMC or other forum—does not replace the individual employee’s right to pursue grievances. Each employee retains the right to deal with his or her employer, and vice-versa. The labor organization is a representative of the collective employees, but this fact does not mean that an employee can act only through the representative. For these reasons, the law (rt. 255) explicitly preserves and respects the right of an individual employee or any group of employees to directly present grievances to their employers at any time. Even when under investigation, an employee can choose to handle personally his defense, unassisted by any representative (Art. 277[b]). The second sentence of Art. 255 is meant to be an exception to the exclusiveness of the representative role of the labor organization. Such individual right cannot be taken away even by a union’s constitution and by-laws. American jurisprudence holds that notwithstanding a union’s obligation as exclusive bargaining representative to process the grievances of all bargaining unit employees, individual employees may at any time present grievances directly to the employer for adjustment without the intervention of the bargaining representative, and without subjecting the employer to liability for refusing to bargain with the union. However, the adjustment of the grievances must be consistent with the terms of the current collective bargaining contract or agreement. Moreover, the bargaining representative must be given the opportunity to be present at the meeting between the employer and employee. 4. COLLECTIVE BARGAINING UNIT (CBU) DEFINED At the enterprise level there are three democratic devices, statutorily embedded, to advance the cause of industrial peace, namely: airing of grievance even by an individual employee directly to the employer anytime; participation in policy and decision-making by employees, whether unionized or not; and collective bargaining with the employer by unionized employees. The collective bargaining that the law envisions occurs between the employer and the employees comprised in an “appropriate” collective bargaining unit (CBU) represented by a union. As initially explained in Art. 234, the “CBU” is that group of jobs and jobholders represented by the recognized or certified union when it bargains with the employer. The “group” may comprise all the supervisors or, separately, all the rank-and-file population in the company. Or it may be less than all of these two categories, although the law prefers to have only one grouping per category in one enterprise because the more solid the unit, the stronger its bargaining capacity. But if a single unit (only one for all supervisors or only one for all rank-and-file) is not feasible, the law allows subgroups as bargaining units, provided only that each sub-group is “appropriate.” It is appropriate if its members share substantially common concerns and interests.
LABOR RELATIONS As defined in D.O. No. 40-03 which is now the revised Book V of the Rules Implementing the Labor Code, “bargaining unit” refers to a group of employees sharing mutual interests within a given employer unit, comprised of all or less than all of the entire body of employees in the employer unit or any specific occupational or geographical grouping within such employer unit. Within one unit there may be one or more unions. The bargaining unit therefore is not the same as, and usually a bigger group than, a union. But only one union should represent the whole CBU in bargaining with the employer. The chosen union is called the bargaining agent, its principal being the CBU members themselves. The bargaining union has to be the majority union, the one where majority of the CBU members belong. “Representative union,” “bargaining union,” “majority union,” “bargaining agent,” and “bargaining representative” are one and the same. It refers to the union that represents the CBU in bargaining or dealing with the employer. 5. APPROPRIATENESS OF BARGAINING UNIT; FACTORS CONSIDERED The determination of what constitutes a proper bargaining unit lies primarily in the discretion of the Bureau, since no individual factor is given by law decisive weight. But while the determination of the appropriate collective bargaining unit (CBU) is a primary function of the Bureau, it is subject to the legal requirement that proper consideration should be given to all legally relevant factors. The basic test of an asserted bargaining unit's acceptability is whether or not it is fundamentally the combination which will best assure to all employees the exercise of their collective bargaining rights. Industrial experience indicates that the most efficacious bargaining unit is one which is comprised of constituents enjoying a community of interest. This community of interest is reflected in groups having substantial similarity of work and duties or similarity of compensation and working conditions.
In making judgments about “community of interest” in these different settings, the Board will look to such factors as: (1) similarity in the scale and manner of determining earnings; (2) similarity in employment benefits, hours of work and other terms and conditions of employment; (3) similarity in the kinds of work performed; (4) similarity in the qualifications, skills and training of the employees; (5) frequency of contact or interchange among the employees; (6) geographic proximity; (7) continuity or integration of production processes; (8) common supervision and determination of laborrelations policy; (9) history of collective bargaining; (10) desires of the affected employees; or (11) extent of union organization. Geographical location can be completely disregarded if the communal or mutual interests of the employees are not sacrificed. 5.1 Bargaining History Not Decisive Factor The basic test of an asserted bargaining unit's acceptability is whether or not it is fundamentally the combination which will best assure to all employees the exercise of their collective bargaining rights.
5.2 Exclusion of Confidential Employees By the very nature of their functions, they assist and act in a confidential capacity to, or have access to confidential matters of, persons who exercise managerial functions in the field of labor relations. As such, the rationale
behind the ineligibility of managerial employees to form, assist or join a labor union equally applies to them.
5.3 Temporary or Part-Time Employees The NLRB has been upheld in excluding temporary employees from bargaining units of workers in certain jobs. In determining whether temporary or part-time employees are sufficiently identified with the regular employees, so as to be properly included in the bargaining unit, one of the important factors considered by the NLRB is the reasonable likelihood that the temporary or part-time employees will eventually become adequately identified in employment with the other members of the bargaining unit. 5.4 Seasonal Employees The full-time seasonal employees who have a reasonable expectation of substantial seasonal employment from year to year have been held properly included in the unit, but part-time seasonal employees who receive none of the fringe benefits enjoyed by full-time employees have insufficient common interest with the full-time employees to be included in the same bargaining unit. 5.5 Probationary Employees The fact that an employee is given a classification such as beginner, trainee or probationary employee, and the fact that contemplation of permanent tenure is subject to satisfactory completion of an initial trial period, are insufficient to warrant such employee’s exclusion from a bargaining unit. Moreover, the eligibility of probationary employees does not turn on the proportion of such employees who, willingly or not, fail to continue to work for the employer throughout the trial period. 6. REFERENDUM WHERE INTERESTS ARE DISSIMILAR The decision then of the Executive Labor Arbiter in merely directing the holding of a referendum “to determine the will of the service engineers, sales representatives as to their inclusion or exclusion in the bargaining unit” is the most appropriate procedure that conforms with their right to form, assist or join a labor union or organization. 6.1 Desire of the Employees; The Globe Doctrine The desires of the employees are relevant to the determination of the appropriate bargaining unit. The relevancy of the wishes of employees concerning their inclusion or exclusion from a proposed bargaining unit is inherent in the basic right to self organization. While the desires of the employees with respect to their inclusion in a bargaining unit is not controlling, it is a factor which would be taken into consideration in reaching a decision. 7. SINGLE OR “EMPLOYER UNIT” IS FAVORED It has been the policy of the Bureau of Labor Relations to encourage the formation of an employer unit unless circumstances otherwise require. In other words, one employer enterprise constitutes only one bargaining unit. The more solid the employees are, the stronger is their bargaining capacity. The proliferation of unions in an employer unit is discouraged as a matter of policy unless there are compelling reasons which would
deny a certain class of employees the right to self-organization for purposes of collective bargaining. Single plant units are presumed to be appropriate for purposes of collective bargaining. Instead of forming another bargaining unit, the law requires them to be members of the existing one. The ends of unionism are better served if all the rank-and-file employees with substantially the same interests and who invoke their right to self-organization are part of a single unit so that they can deal with their employer with just one and yet potent voice. The employees' bargaining power with management is strengthened thereby.
7.1 Exception to One-unit Policy The “one unit-one company” rule is not without exception. The exclusion of the subject employees from the rank-and-file bargaining unit and the CBA is definitely a “compelling reason,” for it completely deprived them of the chance to bargain collectively with petitioner and are thus left with no recourse but to group themselves into a separate and distinct bargaining unit and form their own organization. The usual exception, of course, is where the employer unit has to give way to the other units like the craft unit, plant unit, or a subdivision thereof; the recognition of these exceptions takes into account the policy to assure employees of the fullest freedom in exercising their rights. Otherwise stated, the one company-one union policy must yield to the right of the employees to form unions or associations for purposes not contrary to law, to selforganization and to enter into collective bargaining negotiations, among others, which the Constitution guarantees.
8. TWO COMPANIES WITH RELATED BUSINESSES Two corporations cannot be treated as a single bargaining unit even if their businesses are related. 8.1 Subsidiaries and Spun-Off Corporations Subsidiaries or corporations formed out of former divisions of a mother company following a bona fide reorganization may constitute separate bargaining units. Moreover, in determining an appropriate bargaining unit, the test of grouping is mutuality or commonality of interests. The employees sought to be represented by the collective bargaining agent must have substantial mutual interests in terms of employment and working conditions as evinced by the type of work they performed. Considering the spin-offs, the companies would consequently have their respective and distinctive concerns in terms of the nature of work, wages, hours of work and other conditions of employment. Interests of employees in the different companies perforce differ. SMC is engaged in the business of the beer manufacturing. Magnolia is involved in the manufacturing and processing of dairy products while SMFI is involved in the production of feeds and the processing of chicken. The nature of their products and scales of business may require different skills which must necessarily be commensurated by different compensation packages. The different companies may have different volumes of work and different working conditions. For such reason, the employees of the different companies see the need to group themselves together and organize themselves into distinctive and different groups. It would then be best to have separate bargaining units for the different companies where the employees can bargain separately according to their needs and according to their own working conditions.
9. SUMMATION OF SIGNIFICANCE
LABOR RELATIONS It is helpful to reiterate that the bargaining unit is not the same as the union; in fact, there may be several unions (majority and minority) in one bargaining unit. Determining the scope or “membership” of the bargaining unit is significant and far-reaching because it leads to the determination also of: (1) the employees who can vote in the certification election; (2) the employees to be represented in bargaining with the employer; and (3) the employees who will be covered by the resulting CBA. Distinguishing the CBU from the union is important because— 1. in a CE the voters are the CBU, whether union or non-union members; 2. in CBA ratification the voters are the unit, not just the union members; 3. in strike voting, the voters are the members of the union, not all of the unit. ________ Article 256. Representation Issue in Organized Establishments. - In organized establishments, when a verified petition questioning the majority status of the incumbent bargaining agent is filed by any legitimate labor organization including a national union or federation which has already issued a charter certificate to its local chapter participating in the certification election or a local chapter which has been issued a charter certificate by the national union or federation before the Department of Labor and Employment within the sixty (60)-day period before the expiration of the collective bargaining agreement, the Med-Arbiter shall automatically order an election by secret ballot when the verified petition is supported by the written consent of at least twenty-five percent (25%) of all the employees in the bargaining unit to ascertain the will of the employees in the appropriate bargaining unit. To have a valid election, at least a majority of all eligible voters in the unit must have cast their votes. The labor union receiving the majority of the valid votes cast shall be certified as the exclusive bargaining agent of all the workers in the unit. When an election which provides for three or more choices results in no choice receiving a majority of the valid votes cast, a runoff election shall be conducted between the labor unions receiving the two highest number of votes: Provided, That the total number of votes for all contending unions is at least fifty percent (50%) of the number of votes cast. In cases where the petition was filed by a national union or federation, it shall not be required to disclose the names of the local chapter’s officers and members. At the expiration of the freedom period, the employer shall continue to recognize the majority status of the incumbent bargaining agent where no petition for certification election is filed. (As amended by Section 23, Republic Act No. 6715, March 21, 1989 and Section 10, Republic Act No. 9481 which lapsed into law on May 25, 2007 and became effective on June 14, 2007). ________ Article 257. Petitions in Unorganized Establishments. - In any establishment where there is no certified bargaining agent, a certification election shall automatically be conducted by the MedArbiter upon the filing of a petition by any legitimate labor organization, including a national union or federation which has already issued a charter certificate to its local/chapter participating in the certification election or a local/chapter which has been issued a charter certificate by the national union or federation. In cases where
the petition was filed by a national union or federation, it shall not be required to disclose the names of the local chapter’s officers and members. (As amended by Section 24, Republic Act No. 6715, March 21, 1989 and Section 11, Republic Act No. 9481 which lapsed into law on May 25, 2007 and became effective on June 14, 2007). ________ Article 258. When an employer may file petition. – When requested to bargain collectively, an employer may petition the Bureau for an election. If there is no existing certified collective bargaining agreement in the unit, the Bureau shall, after hearing, order a certification election. All certification cases shall be decided within twenty (20) working days. The Bureau shall conduct a certification election within twenty (20) days in accordance with the rules and regulations prescribed by the Secretary of Labor. ________ Article 258-A. Employer as Bystander. - In all cases, whether the petition for certification election is filed by an employer or a legitimate labor organization, the employer shall not be considered a party thereto with a concomitant right to oppose a petition for certification election. The employer’s participation in such proceedings shall be limited to: (1) being notified or informed of petitions of such nature; and (2) submitting the list of employees during the pre-election conference should the Med-Arbiter act favorably on the petition. (As amended by Section 12, Republic Act No. 9481 which lapsed into law on May 25, 2007 and became effective on June 14, 2007). ________ Article 259. Appeal from certification election orders. – Any party to an election may appeal the order or results of the election as determined by the Med-Arbiter directly to the Secretary of Labor and Employment on the ground that the rules and regulations or parts thereof established by the Secretary of Labor and Employment for the conduct of the election have been violated. Such appeal shall be decided within fifteen (15) calendar days. (As amended by Section 25, Republic Act No. 6715, March 21, 1989). ________ 1. DETERMINING THE BARGAINING UNION: OVERVIEW OF THE METHODS To bargain with the employer, the employees in the collective bargaining unit (CBU) can be represented by one and only one union which has to be a legitimate labor organization duly designated or selected by the employees in the CBU. Under the Code a “bargaining representative” is defined as a “legitimate labor organization or any officer or agent of such organization whether or not employed by the employer.” The Implementing Rules, however, as amended by D.O. No. 40-03 drops the “officer or agent” as it states: “Exclusive bargaining representative means any legitimate labor union duly recognized or certified as the sole and exclusive bargaining representative or agent of all the employees in a bargaining unit.”
LABOR RELATIONS The selection of such bargaining agent may take place in an organized or an unorganized establishment. “Organized establishment” refers to an enterprise where there exists a recognized or certified sole and exclusive bargaining agent. The employer company is “unorganized” where no union has yet been duly recognized or certified as bargaining representative. Art. 256 speaks of an organized firm; Art. 257, of the unorganized. Whether the proceedings take place in an organized or an unorganized bargaining unit, and whether the proceedings are called consent election or certification election, the objective is the same, namely, to identify the union that will represent the employees in bargaining with the employer. Until this representation dispute is resolved, no CBA can be entered into. In an unorganized establishment, the employer may voluntarily recognize the bargaining agent. If there are obstacles to this, the petition to hold an election may be filed anytime by any legitimate labor organization (LLO), except within 12 months from a previous CE, run-off, or consent election. In an organized establishment, on the other hand, voluntary recognition is not possible. A petition to hold a CE has to be filed within the “freedom period” which means the last sixty (60) days of the fifth year of the expiring CBA; in other words, the contest between unions comes at intervals of roughly four years and ten months. The petition may be filed by any LLO, but the petition must have the written support of at least twenty-five percent (25%) of the employees in the bargaining unit. The 25% initial support indicates that the petitioner has a fair chance of winning and that the petition is not just a nuisance. Conceivably but rarely an employer may also file a petition for a CE. The election is conducted under the supervision and control of DOLE officials. It ends up with a formal and official statement of results, certifying which union won, if any. Hence, the election is appropriately called “certification election.” Where one casting of votes is not decisive enough to elect a union, the election officials may require a run-off election if certain other conditions exist, as explained below. But a certification election, a run-off election, or a consent election is needed only when two or more unions are vying for the “office” of exclusive bargaining representative (EBR). Where there is but one union in the bargaining unit and there is ample proof that that union carries the majority of the employees, the law allows the employer to voluntarily recognize such union. Voluntary recognition does away with the more tedious electoral contest between unions. There are, therefore, three methods to determine the bargaining union: (1) voluntary recognition; (2) certification election with or without run-off; and (3) consent election. 2. FIRST METHOD: VOLUNTARY RECOGNITION (V.R.) The employer’s voluntary recognition of the employees’ union significantly facilitates the bargaining process. The employees, especially the union leaders and organizers, rejoice when they are able to convince the employer to voluntarily recognize and subsequently bargain with their union. But VR requires three concurrent conditions.
LABOR RELATIONS First, voluntary recognition is possible only in an unorganized establishment. In an organized setting the employer cannot voluntarily recognized any new union because the law (Art. 256) requires him to continue recognizing and dealing with the incumbent union as long as it has not been properly replaced by another union. Second, only one union is asking for recognition; if there are two or more unions asking to be recognized the employer cannot recognize any of them; the rivalry must be resolved through an election; Third, the union voluntarily recognized should be the majority union as indicated by the fact that members of the bargaining unit did not object to the projected recognition. If no objection is raised, the recognition will proceed, the DOLE will be informed and CBA negotiation will commence. If objection is raised, the recognition is barred, and a certification election or consent election will have to take place. 2.1 VR Under D.O. No. 40-03 Section 1. When and where to file. - In unorganized establishments with only one legitimate labor organization, the employer may voluntarily recognize the representation status of such a union. Within thirty (30) days from such recognition, the employer and union shall submit a notice of voluntary recognition with the Regional Office which issued the recognized labor union's certificate of registration or certificate of creation of a chartered local. Section 2. Requirements for voluntary recognition. - The notice of voluntary recognition shall be accompanied by the original copy and two (2) duplicate copies of the following documents: (a) a joint statement under oath of voluntary recognition attesting to the fact of voluntary recognition; (b) certificate of posting of the joint statement of voluntary recognition for fifteen (15) consecutive days in at least two (2) conspicuous places in the establishment or bargaining unit where the union seeks to operate; (c) the approximate number of employees in the bargaining unit, accompanied by the names of those who support the voluntary recognition comprising at least a majority of the members of the bargaining unit; and (d) a statement that the labor union is the only legitimate labor organization operating within the bargaining unit. All accompanying documents of the notice for voluntary recognition shall be certified under oath by the employer representative and president of the recognized labor union. Section 3. Action on the Notice. - Where the notice of voluntary recognition is sufficient in form, number and substance and where there is no other registered labor union operating within the bargaining unit concerned, the Regional Office, through the Labor Relations Division shall, within ten (10) days from receipt of the notice, record the fact of voluntary recognition in its roster of legitimate labor unions and notify the labor union concerned. Where the notice of voluntary recognition is insufficient in form, number and substance, the Regional Office shall, within the same period, notify the labor union of its findings and advise it to comply with the necessary requirements. Where neither the employer nor the labor union failed to complete the requirements for voluntary recognition under Section 2 of this Rule within thirty (30) days from receipt of the advisory, the Regional Office shall return the notice for voluntary recognition together with all its accompanying documents without prejudice to its re-submission. Section 4. Effect of recording of fact of voluntary recognition. - From the time of recording of voluntary recognition, the recognized labor union shall enjoy
the rights, privileges and obligations of an existing bargaining agent of all the employees in the bargaining unit. Entry of voluntary recognition shall bar the filing of a petition for certification election by any labor organization for a period of one (1) year from the date of entry of voluntary recognition. Upon expiration of this one-year period, any legitimate labor organization may file a petition for certification election in the same bargaining unit represented by the voluntarily recognized union, unless a collective bargaining agreement between the employer and voluntarily recognized labor union was executed and registered with the Regional Office in accordance with Rule XVII of these Rules.
Simply said, the last paragraph means that the employer and the union should conclude and register a CBA within one year from the voluntary recognition, otherwise, the recognition will lapse and a rival union may petition for a certification election. 3. SECOND METHOD: CERTIFICATION ELECTION (C.E.) Whenever there is doubt as to whether a particular union represents the majority of the rank-and-file employees, in the absence of a legal impediment, the holding of a certification election is the most democratic method of determining the employees' choice of their bargaining representative. It is the appropriate means whereby controversies and disputes on representation may be laid to rest, by the unequivocal vote of the employees themselves. Exercising their suffrage through the medium of the secret ballot, they can select the exclusive bargaining representative that, emboldened by their confidence and strengthened by their support shall fight for their rights at the conference table. That is how union solidarity is achieved and union power is increased in the free society. Hence, rather than being inhibited and delayed, the certification election should be given every encouragement under the law, that the will of the workers may be discovered and, through their freely chosen representatives, pursued and realized.
3.1 Fact-Finding In labor legislation, certification proceedings is not a litigation in the sense in which the term is ordinarily understood, but an investigation of non-adversary and fact finding character. As such, it is not bound by technical rules of evidence. The law does not contemplate the holding of a certification election unless the preliminary inquiry shows a reasonable doubt as to which of the contending unions represents a majority, or unless ten per centum of the laborers demand this election. But these grounds necessarily depend on the weight of the evidence adduced by the rival unions, and this weight, in turn, cannot be determined properly if the right to cross examination is denied. Certification proceedings directly involve only two issues: (a) proper composition and constituency of the bargaining unit; and (b) veracity of majority membership claims of the competing unions so as to identify the one union that will serve as the bargaining representative of the entire bargaining unit. But some of the employees may not want to have a union; hence, “No Union” is one of the choices (“candidates”) named in the ballot. If “No Union” wins, the company pr the bargaining unit remains ununionized for at least 12 months, the period known as the 12-month bar. After that period, a petition for a CE may be filed again. 3.1a Certification Election Differentiated from Union Election A union election is held pursuant to the union's constitution and bylaws, and the right to vote in it is enjoyed only by union members. A union election should be
distinguished from a certification election, which is the process of determining, through secret ballot, the sole and exclusive bargaining agent of the employees in the appropriate bargaining unit, for purposes of collective bargaining. Specifically, the purpose of a certification election is to ascertain whether or not a majority of the employees wish to be represented by a labor organization and, in the affirmative case, by which particular labor organization. In a certification election, all employees belonging to the appropriate bargaining unit can vote. Therefore, a union member who likewise belongs to the appropriate bargaining unit is entitled to vote in said election. However, the reverse is not always true; an employee belonging to the appropriate bargaining unit but who is not a member of the union cannot vote in the union election, unless otherwise authorized by the constitution and bylaws of the union. Verily, union affairs and elections cannot be decided in a non-union activity.
The winners in a union election become officers and representatives of the union only. The winner in a certification election is an entity, a union, which becomes the representative of the whole bargaining unit that includes even the members of the defeated unions. 3.2 Direct Certification No Longer Allowed Even in a case where a union has filed a petition for certification election, the mere fact that there was no opposition does not warrant a direct certification. The holding of a certification election at the proper time is not necessarily a mere formality as there was a compelling legal reason not to directly and unilaterally certify a union whose legitimacy is precisely the object of litigation in a pending cancellation case filed by certain "concerned salesmen," who also claim majority status. The direct certification originally allowed under Article 257 of the Labor Code has apparently been discontinued as a method of selecting the exclusive bargaining agent of the workers. This amendment affirms the superiority of the certification election over the direct certification which is no longer available now under the change in said provision.
3.3 Who Files Petition for CE Any legitimate labor organization or any employer, when requested to bargain collectively while the majority status of the union is in doubt, may file a petition for certification election (PCE) In an unorganized establishment one a petition is filed by a legitimate labor organization, the Med-arbiter shall automatically order the conduct of a certification election. The tenor of Article 257 is one of command, so such order is not appealable. To make it appealable will contradict the objective stated in Article 211, to promote free trade unionism. But the application of Article 257 has to be initiated by a genuine petition from a legitimate labor organization. Indeed, the law did not reduce the Med-Arbiter to an automaton which can instantly be set to impulse by the mere filing of a petition for certification election. He is still tasked to satisfy himself that all the conditions of the law are met, and among the legal requirements is that the petitioning union must be a legitimate labor organization in good standing. In an organized establishment the incumbent bargaining agent, of course, will not file a PCE because it will not contest its own incumbency. The filer will most likely be a union that was defeated in the CE held some five years before. In any such petition the incumbent union is a necessary party, a forced intervenor. But even so, it does not thereby lose its representative status; it remains the sole
LABOR RELATIONS bargaining representative until it is replaced by another. And until so replaced it has the right to retain the recognition by the employer. The employer, says Article 258, may file a PCE when it has been asked to bargain. If this happens, the holding of the CE becomes mandatory if there is no existing registered collective bargaining agreement. However, instead of itself filing a petition, the employer usually lets the unions interplead to determine who among them will bargain with the employer. Other unions which are interested in joining a certification election may file a motion for intervention. Such motion is governed by the same rules that apply to a PCE. Whether petitioner or intervenor, the union has to be an LLO. If the petition for certification election was filed by the federation which is merely an agent, the petition is deemed to be filed by the chapter, the principal, which must be a legitimate labor organization. The chapter cannot merely rely on the legitimate status of the mother union. Where the constitution, by-laws and the list of members who supposedly ratified the same were not attested to by the union president, and the constitution and by-laws were not verified under oath, the local union has no personality to file a petition for certification election it not being a legitimate labor organization. The petition should be dismissed. A union that has no legal personality to file a petition for CE has no personality either to file a petition-in-intervention.
3.4 Where to File the Petition for CE A petition for certification election (PCE) shall be filed with the Regional Office which issued the petitioning union’s certificate of registration or certificate of creation of chartered local. The petition shall be heard and resolved by the Med-Arbiter. Where two or more petitions involving the same bargaining unit are filed in one Regional Office, the same shall be automatically consolidated with the Med-Arbiter who first acquired jurisdiction. Where the petitions are filed in different Regional Offices, the Regional Office in which the petitions are first filed shall exclude all others; in which case, the latter shall indorse the petition to the former for consolidation. 3.5 When to File the Petition The proper time to file a petition for CE depends on whether the CBU has a CBA or not. If it has no CBA , the petition may be filed anytime outside the 12-month bar. If it has a CBA, it can be filed only within the last 60 days of the fifth year of the CBA. 3.6 Action on the Petition: Preliminary Conference The preliminary conference shall determine the following: (a) the bargaining unit to be represented; (b) contending labor unions; (c) possibility of a consent election; (d) existence of any of the bars to certification election under Section3 of D.O. No. 40-03;
(e) such other matters as may be relevant for the final disposition of the case. If at the preliminary conference the unions agree to hold a consent election, then the PCE will no longer be heard and the unions will instead prepare for the consent election. If the unions fail to agree to hold a consent election, the Med-arbiter proceeds to consider the petition. He may deny and dismiss, or he may grant, the petition. Denial or grant of the petition is always appealable to the Secretary. Never appealable, however, is the approval of a PCE in an unorganized (ununionized) bargaining unit, the reason being that the law wants the ununionized unionized. 3.7 Action on the Petition: Hearings and Pleadings If the contending unions fail to agree to a consent election during the preliminary conference, the Med-arbiter may conduct as many hearings as he may deem necessary. But the conduct of the hearings cannot exceed fifteen (15) days from the date of the scheduled preliminary conference/ hearing. After that time the petition shall be considered submitted for decision. The Med-arbiter shall have control of the proceedings. Postponements or continuances are discouraged. The failure of any party to appear in the hearing(s) when notified or to file its pleadings shall be deemed a waiver of its right to be heard. The Med-arbiter, however, upon the agreement of the parties for meritorious reasons, may allow the cancellation of scheduled hearing(s). The cancellation of any scheduled hearing(s) shall not be used as a basis for extending the 15-day period within which to terminate the same.
LABOR RELATIONS Excepting Article 258, only a legitimate labor organization (LLO) can file a petition for certification election. Thus, if the petitioning union is not listed in the DOLE’s list of LLOs or it has no CBA registered in the DOLE, these facts raise doubt as to its being an LLO, and the med-arbiter may dismiss the PCE. But even if the union is listed as LLO or is a party to a CBA, its legitimacy may still be questioned in a separate and independent petition for cancellation to be heard and decided by the BLR Director or the Regional Director himself. Does the filing of a petition to cancel the petitioner’s registration cause the suspension or dismissal of the PCE? No, the mere filing foes not. To serve as a ground for dismissal of a PCE, the legal personality of the petitioner should have been revoked or cancelled “with finality.” 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.
The justification for this rule is that the employees’ opportunity to choose a bargaining agent can easily be blocked or forestalled by an employer through the simple expedience of questioning the legitimacy of the petitioner union. Suspension of Proceedings: “Company Union” Charge
Within ten (10) days from the date of the last hearing, the Med-arbiter shall issue a formal order denying or granting the petition. In organized establishments, however, no order or decision shall be issued by the Med-arbiter during the freedom period.
A complaint for unfair labor practice may be considered a prejudicial question in a proceeding for certification election when it is charged therein that one or more labor unions participating in the election are being aided, or are controlled, by the company or employer. The reason is that the certification election may lead to the selection of an employer-dominated or company union as the employees’ bargaining representative, and when the court finds that said union is employer-dominated in the unfair labor practice case, the union selected would be decertified and the whole election proceedings would be rendered useless and nugatory.
The reason for the last-mentioned rule is that during the entire 60-day freedom period, up to its last day, the door should remain open for any union to file a PCE or a motion for intervention.
NONETHELESS, a certification election cannot be stayed during the pendency of unfair labor practice charge against a union filed by the employer.
3.8 Action on the Petition: Denial; Grounds
Similarly, certification election may be ordered despite pendency of a petition to cancel the union’s registration certificate founded on alleged illegal strike by the union.
The Med-arbiter, after due hearing may dismiss the petition on any of the following grounds: (1) Not an LLO (2) Twelve-month Bar (3) Negotiation Bar or Deadlock Bar (4) No 25% Support (5) Contract Bar; PCE Filed Outside the Freedom Period The first three grounds are applicable to establishments with or without a CBA; the last two are pertinent only to an establishment with a CBA about to expire on its fifth year. 3.8a Ground 1: Petitioner not an LLO
3.8b Ground 2: The 12-month Bar (certification year bar) No petition for a CE may be filed within one year from the date of a valid certification, consent, or run-off election or from the date of entry of a voluntary recognition of the union by the employer. Thus, if an election had been held but not one of the unions won a PCE may be filed again but only after 12 months. The law does not want more than one election in a 12-month period. The same bar applies if “No Union” won in the previous election. On the other hand, if a union has won, such union and the employer must within 12 months start negotiating a collective agreement. If they fail to do so, they are defeating the employees’ wish to have a CBA; hence, the union or unions that lost can petition again for a certification election after 12 months from the last election so as to replace the unproductive bargaining agent which, perhaps, is cavorting with the employer.
LABOR RELATIONS Ordinarily, a bargaining agent who failed to secure a CBA within 12 months could be suspected as a tool of management and should deserve to be replaced. But if circumstances show that the cause of not having concluded a CBA was not the union’s fault, such union should not be blamed, and a CE should not be authorized even though no CBA has been concluded despite passage of twelve months. The situation takes the nature of a “deadlock bar.” The 12-month prohibition presupposes that there was an actual conduct of election i.e. ballots were cast and there was a counting of votes. In this case, there was no certification election conducted precisely because the first petition was dismissed, on the ground of a defective petition which did not include all the employees who should be properly included in the collective bargaining unit, the certification year bar does not apply.
Neither does this bar apply if in fact there was a failure of election because less than majority of the CBU members voted. In that case, another PCE may be filed within six (6) months. An election held less than a year after an invalid election is not barred. Also not barred would be a second election held among a group of employees who had not participated in the first election and had not been given the opportunity to be represented as part of the unit in the first election. A radical change in the size of a bargaining unit within a short period of time, raising a question as to the majority status of the certified representative, may also prompt the NLRB to entertain a petition for an election during the certification year. The one-year rule does not apply to a unit clarification petition filed during the certification year. In a CE, the “No Union” choice won. Within 12 months from that election the employer voluntarily recognized a new union and then concluded with it a CBA. Is the 12-month bar violated? Are the recognition and the CBA valid? Excepted from the contract-bar rule are certain types of contracts which do not foster industrial stability, such as contracts where the identity of the representative is in doubt. Any stability derived from such contracts must be subordinated to the employees' freedom of choice because it does not establish the kind of industrial peace contemplated by the law.
In other words, the court strongly doubted that the union voluntarily recognized by the employer was really the employees’ choice. Most probably, it was a company union. 3.8c Ground 3: Negotiation or Deadlock Bar Neither will a PCE prosper if the negotiation is caught in a deadlock. The deadlock does not erase that fact that there is negotiation which is a barrier to holding a certification election. The parties should be allowed to try to resolve their deadlock; replacing the negotiating union will not help. The “Deadlock Bar” Rule simply provides that a petition for certification election can only be entertained if there is no pending bargaining deadlock submitted to conciliation or arbitration or had become the subject of a valid notice of strike or lockout. The principal purpose is to ensure stability in the relationship of the workers and the management. A "deadlock" is the counteraction of things producing entire stoppage; there is a deadlock when there is a complete blocking or stoppage resulting from the
action of equal and opposed forces. The word is synonymous with the word impasse, which "presupposes reasonable effort at good faith bargaining which, despite noble intentions, does not conclude in agreement between the parties." If the law proscribes the conduct of a certification election when there is a bargaining deadlock submitted to conciliation or arbitration, with more reason should it not be conducted if, despite attempts to bring an employer to the negotiation table by the "no reasonable effort in good faith" on the employer certified bargaining agent, there was to bargain collectively. It is only just and equitable that the circumstances in this case should be considered as similar in nature to a "bargaining deadlock" when no certification election could be held.
“Deadlock Bar” Rule, When Not Applicable; Artificial Deadlock The deadlock that bars a CE must be genuine and not a drama. One indicator that it is genuine is the submission of the deadlock to a thirdparty conciliator or arbitrator. Another is that the deadlock is the subject of a valid notice of strike or lockout. An artificial deadlock—a deadlock prearranged or preserved by collusion of the employer and the majority union—is deception of the workers, hence, not a barrier to a petition for a CE. 3.8d Ground 4: 25 Percent Support to PCE Article 256 requires that the petition for a CE in an organized establishment which may be filed within the “freedom period” should be supported by at least twenty-five percent (25%) of the bargaining unit. The support requirement is explained by government policy to favor the self-organization of workers. In a company still unorganized the workers should find it easy to organize, but one a union has established itself as the employees’ representative, it should not be so easy for another union to replace the incumbent. Trying to so will disturb the peace in the enterprise. To justify the disturbance, it must appear that a sizeable portion of the employees—at least 25%— desires to have a new union. Without this minimum support the challenge to the incumbent looks like a nuisance. The CBU, Not the Enterprise If a company’s rank-and-file employees are unionized but the supervisors are not, does the supervisors’ petition need the 25% minimum support? NO, because the company is considered unorganized. The petition for CE involves only the supervisors, not the rank-and-file. Insofar as the supervisors are concerned, the “establishment” is considered ununionized. Hence the requirement for 25% support to the petition does not apply. In other words, in deciding whether the 25% requirement is applicable or not, the law considers the CBU involved, not the whole enterprise. This, again, makes it easy for workers to unionize, a basic objective of labor relations law. Election Despite Lack of 25 Percent Support Even in the situation where the 25% is needed. This requirement may be relaxed. Compliance with the said requirement need not even be established with absolute certainty. The Court has consistently ruled that "even conceding that the statutory requirement of 30% of the labor force asking for a certification
election had not been strictly complied with, respondent Director is still empowered to order that it be held precisely for the purpose of ascertaining which of the, contending labor organizations shall be the exclusive collective bargaining agent."
Effect of Withdrawal of Signatories If a petition for a certification election lacks the 25% support because a sizeable number of union members has withdrawn their membership, may the petition still be granted? Or must it be dismissed? A critical fact to consider is whether the withdrawal happened before or after the filing of the petition. If it happened before the filing, the withdrawal is presumed voluntary and it does not affect the propriety of the petition; if after, the withdrawal is deemed involuntary (perhaps pressured by the employer) and it does not necessarily cause the dismissal of the petition 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 withdrawal their support.
3.8e Ground 5: PCE Filed Outside the Freedom Period; the Contract Bar This means that there exists in the bargaining unit a CBA still in effect at the time the PCE is filed. The ban spans a period of five years, excluding, however, the last sixty (60) days of the fifth (last) year of the CBA.
LABOR RELATIONS bargaining union; the freedom period is a political event involving only the unions and the employees. The two periods, of course, may coincide on the fifth year of the CBA. Registered CBA To bar a certification election it is no longer necessary that the CBA be “certified”; it is enough that it is registered in accordance with Art. 231. Contract-Bar Rule Applied: Extended CBA Under Deadlock No petition for certification election may be filed before the onset of the freedom period not after such period. The old CBA is extended until a new one is signed. Section 6, Rule V, Book V of the implementing Rules provides that a petition for certification election or a motion for intervention can only be entertained within sixty days prior to the expiry date of an existing collective bargaining agreement. Otherwise put, the rule prohibits the filing of a petition for certification election during the existence of a collective bargaining agreement except within the freedom period, as it is called, when the said agreement is about to expire. Article 253 of the Labor Code provides that: "it shall be the duty of both parties to keep the status quo and to continue in full force and effect the terms and conditions of the existing agreement during the 60-day period and/or until a new agreement is reached by the parties." Despite the lapse of the formal effectivity of the CBA the law still considers the same as continuing in force and effect until a new CBA shall have been validly executed. Hence, the contract bar rule still applies.
Contract-Bar Rule Applied: Unproved Surreptitious Registration of CBA Even if the existing CBA is registered surreptitiously, as alleged by the petitioner union, but no evidence is presented proving the alleged surreptitious registration, the petition for CE cannot be granted. The contract-bar rule applies. Whether or not the CBA was indeed surreptitiously registered is a factual matter whose determination is outside the ambit of a petition for certiorari. Contract-Bar Rule Not Applied: (a) Defective CBA
The contract bar rule prohibits the filing of a petition for certification election during the existence of a collective bargaining agreement except within the freedom period, as it is called, when the said agreement is about to expire. The purpose, obviously, is to ensure stability in the relationships of the workers and the management by preventing frequent modifications of any collective bargaining agreement earlier entered into by them in good faith and for the stipulated original period.
To be a bar to a certification election, the CBA must be adequate in that it comprises substantial terms and conditions of employment.
The “freedom period” under Articles 253-A and 256 is different from and ought not to be mistaken for the other sixty-day period mentioned in Art. 253. The latter speaks of the right of the parties to propose modifications to the existing CBA, as an exception to the rule that the CBA cannot be modified during its lifetime. To clarify terms, the sixty days in Art. 253 may be called “renegotiation notice period” or simply “notice/proposal period,” in contrast to the “freedom period” under Arts. 253-A and 256.
(c) CBA Signed Before or Within Freedom Period Despite Injunctive Order
The notice period is the last 60 days of the second or third year of the nonrepresentational provisions; the freedom period is the last 60 days of the CBA’s fifth year of the representational aspect. The notice period is an economic event involving the employer and the
(b) Referendum to Register on Independent Union This referendum is neither union disaffiliation nor severance; it is not disallowed by law even while a CBA exists.
A collective bargaining agreement which was prematurely renewed is not a bar to the holding of a certification election. Such indecent haste in renewing the CBA despite an order enjoining them from doing so is designed to frustrate the constitutional right of the employees to self-organization. Moreover, We cannot countenance the actuation of the petitioner and the management in this case which is not conducive to industrial peace.
Validity of CBA Signed During Representation Dispute It is true that the contract-bar rule does not apply during the “freedom period”; i.e., within that period a petition for CE may be entertained. But it is equally
true that the petition for CE does not bar the employer and the incumbent union from renegotiating and renewing the expiring CBA. In other words, a CBA may be renegotiated before, during, or after the 60-day freedom period. But if during such period a PCE is filed, the Med-arbiter can order the suspension of the renegotiation until the representation proceedings finally end.
The law is attempting a balancing feat. By allowing a PCE during the freedom period the law preserves democratic between unions, and, in the same breadth, by allowing CBA renegotiation during the same freedom period, the law safeguards the opportunity to possibly upgrade the employees’ employment condition. The question may be asked: What would be the effect on the renegotiated CBA if a union other than the one that executed it should win the CE? In a pertinent case, it was held that the union thus certified would have to respect the contract, but that it may bargain with the management to shorten the life of the contract if it is too long. When a collective bargaining agreement is entered into at a time when the petition for certification election had already been filed by a union and was then pending resolution, the said CBA cannot be deemed permanent, precluding the commencement of negotiations by another union with the management. In the meantime however, so as not to deprive the workers of the benefits of the said agreement, it shall be recognized and given effect on a temporary basis, subject to the results of the certification election. The agreement may be continued in force if the union is certified as the exclusive bargaining representative of the workers or may be rejected and replaced in the event that the rival emerges as the winner.
But in a 2005 decision the Court took one step further. It invalidated the hasty recognition of a union and the signing of a CBA with that union where such acts were done while there was a pending petition for certification election by another union. Basic to the contract bar rule is the proposition that the delay of the right to select representatives can be justified only where stability is deemed paramount. Excepted from the contract bar rule are certain types of contracts which do not foster industrial stability, such as contracts where the Identity of the representative is in doubt. Any stability derived from such contracts must be subordinated to the employees' freedom of choice because it does not establish the type of industrial peace contemplated by the law. A CBA automatically renewed usually operates as a bar to a certification election. But it is not a bar if the employer has served notice that it will terminate the contract if and when the union no longer represents the majority of the employees.
3.9 Invalid Grounds for the Denial/Suspension of the Petition Questions pertaining to the validity of petitioning union’s certificate of registration, or its legal personality as a labor organization, or the validity of registration and execution of collective bargaining agreements shall be heard and resolved by the Regional Director in an independent petition for cancellation of the union’s registration. They are not reasons for the Med-arbiter to suspend hearing the PCE. However, the Med-arbiter himself may rule on the objection if the pending union is not found in the Department’s roster of legitimate labor organizations or an alleged collective bargaining agreement is unregistered with the Department. 3.9a Authority to Decide Existence of Employer-Employee Relationship; Med-Arbiter’s Order Appealable to Secretary
LABOR RELATIONS Does the Med-arbiter or the Secretary of Labor and Employment have the authority to determine the existence of an employer-employee relationship between the parties in a petition for certification election? All issues pertaining to the existence of employer-employee relationship or to eligibility to union membership shall be resolved in the order or decision ranting or denying the petition for certification election. In other words, those issues do not stall the PCE and they are not grounds for dismissing a PCE. It is absurd to suggest that the med-arbiter and Secretary of Labor cannot make their own independent finding as to the sentence of such relationship and must have to rely and wait for such a determination by the labor arbiter or NLRC in a separate proceeding. For then, given a situation where there is no separate complaint filed with the labor arbiter, the med-arbiter and/or the Secretary of Labor can never decide a certification election case or any labor-management dispute properly brought before them as they have no authority to determine the existence of an employer-employee relationship. Such a proposition is, to say the least, anomalous. Once there is a determination as to the existence of such a relationship, the med-arbiter can then decide the certification election case. 9 As the authority to determine the employer-employee relationship is necessary and indispensable in the exercise of jurisdiction by the med-arbiter, his finding thereon may only be reviewed and reversed by the Secretary of Labor who exercises appellate jurisdiction under Article 259 of the Labor Code, as amended.
It is apparent that incidental to the power of the med-arbiter to hear and decide representation cases is the power to determine who the eligible voters are. In so doing, it is axiomatic that the med-arbiter should determine the legality of the employees' membership in the union. 3.10 Action on the Petition: Is the Employer a Bystander? See Art. 258-A 3.10a Employer a Bystander; Cannot Oppose PCE 3.11 Action on the Petition: Approval Section 13. Order/Decision on the petition. - Within ten (10) days from the date of the last hearing, the Med-Arbiter shall issue a formal order granting the petition or a decision denying the same. In organized establishments, however, no order or decision shall be issued by the Med-Arbiter during the freedom period. The order granting the conduct of a certification election shall state the following: (a) the name of the employer or establishment; (b) the description of the bargaining unit; (c) a statement that none of the grounds for dismissal enumerated in the succeeding paragraph exists; (d) the names of contending labor unions which shall appear as follows: petitioner union/s in the order in which their petitions were filed, forced intervenor, and no union; and (e) a directive upon the employer and the contending union(s) to submit within ten (10) days from receipt of the order, the certified list of employees in the bargaining unit, or where necessary, the payrolls covering the members of the bargaining unit for the last three (3) months prior to the issuance of the order
3.12 Appeal of Order Granting or Denying Petition
LABOR RELATIONS Section 17. Appeal. - The order granting the conduct of a certification election in an unorganized establishment shall not be subject to appeal. Any issue arising therefrom may be raised by means of protest on the conduct and results of the certification election. The order granting the conduct of a certification election in an organized establishment and the decision dismissing or denying the petition, whether in an organized or unorganized establishment, may be appealed to the Office of the Secretary within ten (10) days from receipt thereof. 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 the supporting arguments and evidence.
In short, denial of any petition for CE is always appealable, but never appealable is the approval of any PCE in an enterprise still ununionized. The reason is sound and simple: the law wants to unionized the ununionized. Section 18. Where to file appeal. - The memorandum of appeal shall be filed in the Regional Office where the petition originated, copy furnished the contending unions and the employer, as the case may be. Within twenty-four (24) hours from receipt of the appeal, the Regional Director shall cause the transmittal thereof together with the entire records of the case to the Office of the Secretary. Section 19. Finality of Order/Decision. - Where no appeal is filed within the ten-day period, the Med-Arbiter shall enter the finality of the order/decision in the records of the case and cause the transmittal of the records of the petition to the Regional Director. Section 20. Period to Reply. - A reply to the appeal may be filed by any party to the petition within ten (10) days from receipt of the memorandum of appeal. The reply shall be filed directly with the Office of the Secretary. Section 21. Decision of the Secretary. - The Secretary shall have fifteen (15) days from receipt of the entire records of the petition within which to decide the appeal. The filing of the memorandum of appeal from the order or decision of the Med-Arbiter stays the holding of any certification election. The decision of the Secretary shall become final and executory after ten (10) days from receipt thereof by the parties. No motion for reconsideration of the decision shall be entertained. Section 22. Transmittal of records to the Regional Office. - Within forty-eight (48) hours from notice of receipt of decision by the parties and finality of the decision, the entire records of the case shall be remanded to the Regional Office of origin for implementation. Implementation of the decision shall not be stayed unless restrained by the appropriate court.
May a certification election be held legally upon petition of Union B while a petition for CE by Union A is pending on appeal at the Office of the Secretary? No, the appeal should first be resolved. 3.13 Conducting the CE 3.13a Pre-election Conference Section 1. Raffle of the case. - Within twenty-four (24) hours from receipt of the notice of entry of final judgment granting the conduct of a certification election, the Regional Director shall cause the raffle of the case to an Election Officer who shall have control of the pre-election conference and election proceedings. Section 2. Pre-election conference. - Within twenty-four (24) hours from receipt of the assignment for the conduct of a certification election, the Election Officer shall cause the issuance of notice of preelection conference upon the
contending unions and the employer, which shall be scheduled within ten (10) days from receipt of the assignment. The pre-election conference shall set the mechanics for the election and shall determine, among others, the following: (a) date, time and place of the election, which shall not be later than forty-five (45) days from the date of the first pre-election conference, and shall be on a regular working day and within the employer's premises, unless circumstances require otherwise; (b) list of eligible and challenged voters; (c) number and location of polling places or booths and the number of ballots to be prepared with appropriate translations, if necessary; (d) name of watchers or representatives and their alternates for each of the parties during election; (e) mechanics and guidelines of the election. Section 3. Waiver of right to be heard. - Failure of any party to appear during the pre-election conference despite notice shall be considered as a waiver to be present and to question or object to any of the agreements reached in said preelection conference. Nothing herein, however, shall deprive the non-appearing party or the employer of its right to be furnished notices of subsequent preelection conferences and to attend the same. Section 4. Minutes of pre-election conference. - The Election Officer shall keep the minutes of matters raised and agreed upon during the pre-election conference. The parties shall acknowledge the completeness and correctness of the entries in the minutes by affixing their signatures thereon. Where any of the parties refuse to sign the minutes, the Election Officer shall note such fact in the minutes, including the reason for refusal to sign the same. In all cases, the parties shall be furnished a copy of the minutes. The pre-election conference shall be completed within thirty (30) days from the date of the first hearing. Section 6. Posting of Notices. - The Election Officer shall cause the posting of notice of election at least ten (10) days before the actual date of the election in two (2) most conspicuous places in the company premises. The notice shall contain: (a) the date and time of the election; (b) names of all contending unions; (c) the description of the bargaining unit and the list of eligible and challenged voters. The posting of the notice of election, the information required to be included therein and the duration of posting cannot be waived by the contending unions or the employer.
3.13b Conducting the CE: The Voters One of the matters the pre-election conference threshes out is the list of voters. Section 5. Qualification of voters; inclusion-exclusion. - All employees who are members of the appropriate bargaining unit sought to be represented by the petitioner at the time of the issuance of the order granting the conduct of a certification election shall be eligible to vote.
The list of voters should be based on the employer-certified list of employees in the CBU or payrolls. If the employer does not submit the list or payrolls, the union may submit its own list. Even the list of employees submitted to the SSS may be used as basis to comprise the list of voters for the CE. “It should ideally be the
LABOR RELATIONS payroll which should have been used for the purpose of the election. However, the unjustified refusal of a company to submit the payroll in its custody, despite efforts to make it produce it, compelled resort to the SSS list as the next best source of information. After all, the SSS list is a public record whose regularity is presumed.” Only the employees who are directly employed by the employer and working along the activities to which the employer is engaged and linked by employer-employee relationship are qualified to participate in the certification election, “irrespective of the period of their employment.” Employees of an independent contractor who undertakes to do a piece of work for his account and responsibility, with minimum interference on the part of the other contracting party (indirect employer), not being laborers or employees of the latter, are not qualified to participate therein. In case of disagreement over the voters' list or over the eligibility of voters, all contested voters shall be allowed to vote. But their votes shall be segregated and sealed in individual envelopes in accordance with Sections 10 and 11 of this Rule.
Dismissed Employee 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 final judgment at the time of the conduct of the certification election. In Philippine jurisprudence it is now settled that employees who have been improperly laid off but who have a present, unabandoned right to or expectation of re-employment, are eligible to vote in certification elections. 10 Thus, and to repeat, if the dismissal is under question, as in the case now at bar whereby a case of illegal dismissal and/or unfair labor practice was filed, the employees concerned could still qualify to vote in the elections.
Probationary Employee In a certification election all rank-and-file employees in the appropriate bargaining unit are entitled to vote. This principle is clearly stated in Art. 255 of the Labor Code which states that the "labor organization designated or selected by the majority of the employees in an appropriate bargaining unit shall be the exclusive representative of the employees in such unit for the purpose of collective bargaining." Collective bargaining covers all aspects of the employment relation and the resultant CBA negotiated by the certified union binds all employees in the bargaining unit. Hence, all rank-and-file employees, probationary or permanent, have a substantial interest in the selection of the bargaining representative. The Code makes no distinction as to their employment status as basis for eligibility in supporting the petition for certification election. The law refers to "all" the employees in the bargaining unit. All they need to be eligible to support the petition is to belong to the "bargaining unit.".
INK Believers May Vote In the CE all members of the unit, whether union members or not, have the right to vote. Union membership is not a prerequisite. If majority of the unit members do not want a union, as expressed in the CE, such majority decision must be respected. Logically, the right NOT to join, affiliate with, or assist any union, and to disaffiliate or resign from a labor organization, is subsumed in the right to join,
affiliate with, or assist any union, and to maintain membership therein. The right to form or join a labor organization necessarily includes the right to refuse or refrain from exercising 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. The fact that a person has opted to acquire membership in a labor union does not preclude his subsequently opting to renounce such membership. The purpose of a certification election is precisely the ascertainment of the wishes of the majority of the employees in the appropriate bargaining unit: to be or not to be represented by a labor organization, and in the affirmative case, by which particular labor organization. If the results of the election should disclose that the majority of the workers do not wish to be represented by any union, then their wishes must be respected, and no union may properly be certified as the exclusive representative of the workers in the bargaining unit in dealing with the employer regarding wages, hours and other terms and conditions of employment. The minority employees — who wish to have a union represent them in collective bargaining — can do nothing but wait for another suitable occasion to petition for a certification election and hope that the results will be different. They may not and should not be permitted, however, to impose their will on the majority — who do not desire to have a union certified as the exclusive workers' benefit in the bargaining unit — upon the plea that they, the minority workers, are being denied the right of selforganization and collective bargaining. The respondents' argument that the petitioners are disqualified to vote because they "are not constituted into a duly organized labor union" — "but members of the INK which prohibits its followers, on religious grounds, from joining or forming any labor organization" — and "hence, not one of the unions which vied for certification as sole and exclusive bargaining representative," is specious. Neither law, administrative rule nor jurisprudence requires that only employees affiliated with any labor organization may take part in a certification election. On the contrary, the plainly discernible intendment of the law is to grant the right to vote to all bona fide employees in the bargaining unit, whether they are members of a labor organization or not.
3.13c Conducting the CE: The Voting Section 7. Secrecy and sanctity of the ballot. - To ensure secrecy of the ballot, the Election Officer, together with the authorized representatives of the contending unions and the employer, shall before the start of the actual voting, inspect the polling place, the ballot boxes and the polling booths. Section 8. Preparation of ballots. - The Election Officer shall prepare the ballots in English and Filipino or the local dialect, corresponding to the number of voters and a reasonable number of extra ballots. All ballots shall be signed at the back by the Election Officer and authorized representative of each of the contending unions and employer. Failure or refusal to sign the ballots shall be considered a waiver thereof and the Election Officer shall enter the fact of such refusal or failure in the records of the case as well as the reason for the refusal or failure to sign. Section 9. Marking of votes. - The voter must put a cross () or check () mark in the square opposite the name of the union of his choice or "No Union" if he/she does not want to be represented by any union. If a ballot is torn, defaced or left unfilled in such a manner as to create doubt or confusion or to identify the voter, it shall be considered spoiled. If the voter inadvertently spoils a ballot, he/she shall return it to the Election Officer who shall destroy it and give him/her another ballot. Section 10. Challenging of votes. - An authorized representative of any of the contending unions and employer may challenge a vote before it is deposited in the ballot box only on any of the following grounds: (a) that there is no employer-employee relationship between the voter and the company; (b) that the voter is not a member of the appropriate bargaining unit which petitioner seeks to represent.
LABOR RELATIONS Section 11. Procedure in the challenge of votes. - When a vote is properly challenged, the Election Officer shall place the ballot in an envelope which shall be sealed in the presence of the voter and the representatives of the contending unions and employer. The Election Officer shall indicate on the envelope the voter's name, the union or employer challenging the voter, and the ground for the challenge. The sealed envelope shall then be signed by the Election Officer and the representatives of the contending unions and employer. The Election Officer shall note all challenges in the minutes of the election and shall be responsible for consolidating all envelopes containing the challenged votes. The envelopes shall be opened and the question of eligibility shall be passed upon only if the number of segregated voters will materially alter the results of the election. Section 12. On-the-spot questions. - The Election Officer shall rule on any question relating to and raised during the conduct of the election. In no case, however, shall the election officer rule on any of the grounds for challenge specified in the immediately preceding section. Section 13. Protest; when perfected. - Any party-in-interest may file a protest based on the conduct or mechanics of the election. Such protests shall be recorded in the minutes of the election proceedings. Protests not so raised are deemed waived. The protesting party must formalize its protest with the Med-Arbiter, with specific grounds, arguments and evidence, within five (5) days after the close of the election proceedings. If not recorded in the minutes and formalized within the prescribed period, the protest shall be deemed dropped. Section 15. Conduct of election and canvass of votes. - The election precincts shall open and close on the date and time agreed upon during the pre-election conference. The opening and canvass shall proceed immediately after the precincts have closed. Failure of any party or the employer or his/her/their representative to appear during the election proceedings shall be considered a waiver to be present and to question the conduct thereof.
ULP in Relation to Election The employer deserves our strongest condemnation for ignoring the petitioners' request for permission for some time out to attend to the hearing of their petition before the med-arbiter. It is not only an act of arrogance, but a brazen interference as well with the employees right to self-organization, contrary to the prohibition of the Labor Code against unfair labor practices. It is unfair labor practice for the company to suspended the workers on the ground of "abandonment of work" on the day on which the pre-election conference had been scheduled. It is the employee’s right to hold a certification election, the exercise of which is their sole prerogative. A company commits unfair labor practice where it issued suspension and termination orders while the employees are in the midst of a certification election preliminary to a labor management conference "to normalize employer-employee relations."
3.13d Conducting the CE: Canvassing of Votes The voting shall close on the date and time agreed upon in the preelection conference. Canvassing shall immediately follow. Section 14. Canvassing of votes. - The votes shall be counted and tabulated by the Election Officer in the presence of the representatives of the contending unions. Upon completion of the canvass, the Election Officer shall give each representative a copy of the minutes of the election proceedings and results of the election. The ballots and the tally sheets shall be sealed in an envelope and signed by the Election Officer and the representatives of the contending unions and transmitted to the Med-Arbiter, together with the minutes and results of the election, within twenty-four (24) hours from the completion of the canvass. Where the election is conducted in more than one region, consolidation of results shall be made within fifteen (15) days from the conduct thereof.
3.13e Who Wins in CE: Proclamation and Certification Section 20. Proclamation and certification of the result of the election. - Within twenty-four (24) hours from final canvass of votes, there being a valid election, the Election Officer shall transmit the records of the case to the Med-Arbiter who shall, within the same period from receipt of the minutes and results of election, issue an order proclaiming the results of the election and certifying the union which obtained a majority of the valid votes cast as the sole and exclusive bargaining agent in the subject bargaining unit, under any of the following conditions: (a) no protest was filed or, even if one was filed, the same was not perfected within the five-day period for perfection of the protest; (b) no challenge or eligibility issue was raised or, even if one was raised, the resolution of the same will not materially change the results of the elections. The winning union shall have the rights, privileges and obligations of a duly certified collective bargaining agent from the time the certification is issued. Where majority of the valid votes cast results in "No Union" obtaining the majority, the Med-Arbiter shall declare such fact in the order. Section 16. Certification of Collective Bargaining Agent. - The union which obtained a majority of the valid votes cast shall be certified as the sole and exclusive bargaining agent of all the employees in the appropriate bargaining unit within five (5) days from the day of the election, provided no protest is recorded in the minutes of the election.
3,13f Failure of Election: Motion for a Remedial Election Section 17. Failure of election. - Where the number of votes cast in a certification or consent election is less than the majority of the number of eligible voters and there are no material challenged votes, the Election Officer shall declare a failure of election in the minutes of the election proceedings. Section 18. Effect of failure of election. - A failure of election shall not bar the filing of a motion for the immediate holding of another certification or consent election within six (6) months from date of declaration of failure of election. Section 19. Action on the motion. - Within twenty-four (24) hours from receipt of the motion, the Election Officer shall immediately schedule the conduct of another certification or consent election within fifteen (15) days from receipt of the motion and cause the posting of the notice of certification election at least ten (10) days prior to the scheduled date of election in two (2) most conspicuous places in the establishment. The same guidelines and list of voters shall be used in the election.
3.13g Run-off Election Section 1. When proper. - When an election which provides for three (3) or more choices results in none of the contending unions receiving a majority of the valid votes cast, and there are no objections or challenges which if sustained can materially alter the results, the Election Officer shall motu propio conduct a run-off election within ten (10) days from the close of the election proceedings between the labor unions receiving the two highest number of votes; provided, that the total number of votes for all contending unions is at least fifty (50%) percent of the number of votes cast. "No Union" shall not be a choice in the run-off election. Notice of run-off elections shall be posted by the Election Officer at least five (5) days before the actual date of run-off election. Section 2. Qualification of voters. - The same voters' list used in the certification election shall be used in the run-off election. The ballots in the runoff election shall provide as choices the unions receiving the highest and second highest number of the votes cast. The labor union receiving the greater
number of valid votes cast shall be certified as the winner, subject to Section 20, Rule IX.
To summarize, a run-off election is proper if five concurrent conditions exist, namely: 1. a valid election took place because majority of the CBU members voted. 2. the election presented a least three choices, e.g., Union One, Union Two, and No Union, meaning there are at least two union “candidates.” 3. not one of the unions obtained the majority ofthe valid votes. 4. the total number of votes for all the unions is at least 50% of the valid votes cast. 5. there is no unresolved challenge of voter or election protest. 3.14 Appeal to Secretary as to Election Result—See D.O. No. 40-E-03 (dated 30 November 2005) 3.15 Election Irregularities, Protest by Employer The manner in which the election was held could make the difference between industrial strife and industrial harmony in the company. What an employer is prohibited from doing is to interfere with the conduct of the certification election for the purpose of influencing its outcome. But certainly an employer has an abiding interest in seeing to it that the election is clean, peaceful, orderly and credible.
LABOR RELATIONS provisions of the Act, constitutes the agent as the representative of all the employees within the particular bargaining unit. The Act provides that such bargaining agent shall be the “exclusive” representative of the employees. The term “exclusive” was interpreted under the original Act to mean that the employer must treat with the representative to the exclusion of all other claiming bargaining agents. 5.1 Exclusive Bargaining Agent Represents Even the Minority Union On the part of the union that won in the certification election, it becomes, and is certified as, the exclusive bargaining agent of all the workers in the bargaining unit. It represents even the members of the minority union. However, although the union has every right to represent its members in the negotiation regarding the terms and conditions of their employment, it cannot negate their wishes on matters which are purely personal and individual to them.
5.2 Protection and Capacity of the Loser; the Duty of Fair Representation What if the majority union neglects the interest of the employees in the minority union? The majority union in such case will be violating its duty of fair representation. This duty obligates the majority union to serve the interest of all members of the whole bargaining unit without hostility or discrimination.
4. THIRD METHOD: CONSENT ELECTION
What can the minority do? The minority union, although a loser in the election, does not lose its character as a lawful labor organization entitled to protection under Article 246 which makes it unlawful for any person to abridge the right to self-organization. (see also Article 255)
Like a CE, its purpose is the same, namely, to find out which union should serve as the bargaining agent. The difference is that a certification is ordered by the Department while a consent election is voluntarily agreed upon by the parties, with or without the intervention of the Department.
May a minority union charge the employer with ULP? Yes. It can file an individual or group complaint for ULP. It can even engage in peaceful concerted activity. But it cannot resort to work stoppage or strike because strike is reserved, under Article 263, to an exclusive bargaining representative (i.e., the majority union), if there is one.
Two or more unions are involved in a consent election. And like certification election, consent election may take place in an unorganized or organized establishment.
5.3 Is the Bargaining Union a Majority Union?
4.1 Effect of Consent Election Section 23. Effects of consent election. - Where a petition for certification election had been filed, and upon the intercession of the Med-Arbiter, the parties agree to hold a consent election, the results thereof shall constitute a bar to the holding of a certification election for one (1) year from the holding of such consent election. Where an appeal has been filed from the results of the consent election, the running of the one-year period shall be suspended until the decision on appeal has become final and executory. Where no petition for certification election was filed but the parties themselves agreed to hold a consent election with the intercession of the Regional Office, the results thereof shall constitute a bar to another petition for certification election.
5. THE WINNER REPRESENTATIVE
Collective bargaining contemplates the representation of the collective bargaining interests of all the employees in the particular bargaining unit by a properly selected bargaining agent. The selection of a bargaining agent by a majority of such employees, under express
The minority union’s entitlement to protection gains greater force and respect if it is remembered that the bargaining union does not always comprise the numerical majority in the bargaining unit. Article 256 requires, for a union to win a CE, only a majority of the valid votes cast. The majority of the valid votes may be lesser that the majority of the employees in the bargaining unit. Article 256 therefore does not support Article 255; in fact, they are incongruent. Whereas Article 255 requires selection by majority of the unit members, Article 256 requires only majority of the valid votes cast. The result may be a bargaining agent that does not carry the mandate of the majority of the employees. 5.4 May the Bargaining Agent Represent Retired Employees? In pursuing their claim for retirement benefits under the CBA, the claimant retirees are represented by the union of which they were former members. ________ Title VII-A GRIEVANCE MACHINERY
AND VOLUNTARY ARBITRATION
LABOR RELATIONS Unilaterally formulated rules and policy can neither contradict nor undermine the CBA provisions.
Article. 260. Grievance machinery and voluntary arbitration. - The parties to a Collective Bargaining Agreement shall include therein provisions that will ensure the mutual observance of its terms and conditions. They shall establish a machinery for the adjustment and resolution of grievances arising from the interpretation or implementation of their Collective Bargaining Agreement and those arising from the interpretation or enforcement of company personnel policies.
Since the collective bargaining agreement is considered the law between the parties, containing as it does the agreed terms of employment of the employee with his employer, unilaterally imposed orders or rules qualifying the terms contained in the agreement are subordinate to the CBA. At most, such rules, such as the rules on trips abroad formulated by petitioner [school] a few months before Legaspi’s application, are merely suppletory and can neither contradict nor undermine the terms found in the CBA.
All grievances submitted to the grievance machinery which are not settled within seven (7) calendar days from the date of its submission shall automatically be referred to voluntary arbitration prescribed in the Collective Bargaining Agreement. For this purpose, parties to a Collective Bargaining Agreement shall name and designate in advance a Voluntary Arbitrator or panel of Voluntary Arbitrators, or include in the agreement a procedure for the selection of such Voluntary Arbitrator or panel of Voluntary Arbitrators, preferably from the listing of qualified Voluntary Arbitrators duly accredited by the Board. In case the parties fail to select a Voluntary Arbitrator or panel of Voluntary Arbitrators, the Board shall designate the Voluntary Arbitrator or panel of Voluntary Arbitrators, as may be necessary, pursuant to the selection procedure agreed upon in the Collective Bargaining Agreement, which shall act with the same force and effect as if the Arbitrator or panel of Arbitrators has been selected by the parties as described above. ________ 1. CONTRACT ADMINISTRATION AS PART OF THE DUTY TO BARGAIN Collective bargaining is not an end in itself. It is a means to an end, which is the making of collective agreements stabilizing employment relations for a period of time with results advantageous both to the worker and the employer. However narrowly it may canalize its course, the execution of a contract does not complete collective bargaining. Piece rates and work assignments frequently require day-to-day adjustments; periodic decisions must be made concerning such matters as shop rules, job content, and the letting of subcontracts. There will be ambiguities in the agreement to be clarified and gaps be filled. In other words, the duty to bargain continues into the contract administration stage. In effect, therefore, “contract negotiations are the legislative process of collective bargaining; the day-to-day working out of plant problems is its administrative or judicial aspects. Strengthening the binding force of the CBA, Art. 248 considers as unfair labor practice any act that violates an existing collective bargaining agreement. But this law must be related to Art, 261 which limits that kind of ULP to “gross violations” only. 2. C.B.A., LAW BETWEEN THE PARTIES The provisions of the collective bargaining agreement must be respected since its terms and conditions "constitute the law between the parties." Those who are entitled to its benefits can invoke its provisions. In the event that an obligation therein imposed is not fulfilled, the aggrieved party has the right to go to court for redress.
2.1 Construing the Contract The CBA being a contract, the rules embodied in the Civil Code on interpretation of contracts should govern. The intent of the parties should be ascertained by considering relevant provisions of the said CBA. The intention of the parties is primordial; if the terms of the contract are clear, the literal meaning of the stipulations shall control, but if the words appear to be contrary to the evident intention of the parties, the latter shall prevail over the former. Any doubts or ambiguity in the contract between management and the union members should be resolved in the light of Article 1702 of the Civil Code that: In case of doubt, all labor legislation and all labor contracts shall be construed in favor of the safety and decent living for the laborer. This is also in consonance with the principle enunciated in the Labor Code that all doubts should be resolved in favor of the worker. But contracts which are not ambiguous are to be interpreted according to their literal meaning and should not be interpreted beyond their obvious intendment. Compliance with a CBA is mandated by the expressed policy to give protection to labor. In the same vein, CBA provisions should be "construed liberally rather than narrowly and technically, and the courts must place a practical and realistic construction upon it, giving due consideration to the context in which it is negotiated and purpose which it is intended to serve." This is founded on the dictum that a CBA is not an ordinary contract but one impressed with public interest. It goes without saying, however, that only provisions embodied in the CBA should be so interpreted and complied with.
2.2 Proposal Contained in Minutes but Not in the CBA Itself A proposal mentioned in the negotiation but not embodied in the collective bargaining contract itself is not part of the CBA. It cannot serve as basis of a charge of violating the CBA or of bargaining in bad faith. 2.3 “Zipper Clause” A device to forestall negotiation proposals after the CBA has been signed is the “zipper clause.” It is a stipulation in a CBA indicating that issues that could have been negotiated but not contained in the CBA cannot be raised for negotiation when the CBA is already in effect. In short, the CBA is a complete agreement; negotiation is closed, as a zipper does. 3. LAW DEEMED WRITTEN IN CONTRACT The principle is thus well-settled that an existing law enters into and forms part of a valid contract without the need for the parties expressly making reference to it. Only thus could its validity insofar as some of its provisions are concerned be assured. 4. BINDING EFFECT OF AGREEMENT A collective bargaining agreement entered into by officers of a union, as agent of the members, and an employer, gives rise to valid enforceable contractual
LABOR RELATIONS relations, against the individual union members in matters that affect them peculiarly, and against the union in matters that affect the entire membership or large classes of its members," and "a union member who is employed under an agreement between the union and his employer is bound by the provisions thereof, since it is a joint and several contract of the members of the union entered into by the union as their agent."
4.1 Persons Entitled to Benefits It is true that whatever benefits the majority union obtains from the employer accrue to its members as well as to non-members. For the benefits of a collective bargaining agreement are extended to all employees regardless of their membership in the union because to withhold the same from the nonmembers would be to discriminate against them. It is even conceded that a laborer can claim benefits from a collective bargaining agreement entered into between the company and the union of which he is a member at the time of the conclusion of the agreement, even after he has resigned from said union.
4.2 Managers Not Entitled to CBA Benefits; Exception Managers, who are not allowed to unionize to bargain collectively with the employer, cannot claim the benefits contained in the CBA negotiated by the workers under them. They cannot obtain indirectly what they cannot do directly. Accordingly, managerial employees cannot, in the absence of an agreement to the contrary, be allowed to share in the concessions obtained by the labor union through collective negotiation. Otherwise, they would be exposed to the temptation of colluding with the union during the negotiations to the detriment of the employer. However, there is nothing to prevent the employer from granting benefits to managerial employees equal to or higher than those afforded to union members. There can be no conflict of interest where the employer himself voluntarily agrees to grant such benefits to managerial employees. In the case at bar, at the beginning of petitioner's employment, he was told that those who are not covered by the CBA would nevertheless be entitled to benefits which would be, if not higher, at least equivalent to those provided in the CBA. That private respondents made such a promise to petitioner is not denied by them.
4.3 Effect of Collective Agreement on the Individual Contracts of Employment When a collective agreement is concluded between a labor union and an employer, the members of the labor union are precluded from entering into individual contracts of employment. But if the agreement merely fixes wages and working conditions, the employer may enter into particular contracts of employment with his employees even though both are bound by the general contract as to wages and working conditions. 5. ENFORCEABILITY ENTERPRISE
As a general rule, there is no law requiring a bona fide purchaser of assets of an on-going concern to absorb in its employ the employees of the latter.
5.2 Exceptions Although the purchaser of the assets or enterprise is not legally bound to absorb in its employ the employers of the seller of such assets or enterprise, the parties are liable to the employees if the transaction between the parties is colored or clothed with bad faith.
5.3 Merger and Consolidation Merger takes place when two or more corporations join into a single corporation which is one of the merging corporations; the separate existence of the other constituent corporations ceases. Consolidation occurs when two or more corporations join into a new single corporation; the separate existence of all the constituent corporations ceases, except that of the consolidated corporation. Section 80. Effects of merger or consolidation. - The merger or consolidation shall have the following effects: xxx 5. The surviving or consolidated corporation shall be responsible and liable for all the liabilities and obligations of each of the constituent corporations in the same manner as if such surviving or consolidated corporation had itself incurred such liabilities or obligations; and any pending claim, action or proceeding brought by or against any of such constituent corporations may be prosecuted by or against the surviving or consolidated corporation. The rights of creditors or liens upon the property of any of such constituent corporations shall not be impaired by such merger or consolidation. (n)
5.4 Wiley Doctrine The disappearance by merger of a corporate employer which has entered into a collective bargaining agreement with a union does not automatically terminate all rights of the employees covered by the agreement, even though the merger is for genuine business reasons. Under the Wiley doctrine, a duty to arbitrate arising from a collective bargaining agreement survives the employer’s ceasing to do business as a separate entity after its merger with a substantially large corporation, so as to be binding on the larger corporation, where relevant similarity and continuity of operations across the change in ownership is evidenced by the wholesale transfer of the smaller corporation’s employees to the larger corporation’s plant. If a contractual duty to arbitrate survives the employer’s merger into another corporate employer, question as to the effect of the merger on the rights of the employees covered by the agreement—the former employees of the merged employer—are arbitrable if questions as to those rights would have been arbitrable before the merger.
5.1 Purchase of Assets The rule is that unless expressly assumed, labor contracts such as employment contracts and collective bargaining agreements are not enforceable against a transferee of an enterprise, labor contracts being in personam, thus binding only between the parties. A labor contract merely creates an action in personally and does not create any real right which should be respected by third parties. This conclusion draws its force from the right of an employer to select his employees and to decide when to engage them as protected under our Constitution, and the same can only be restricted by law through the exercise of the police power.
But a duty to arbitrate arising from collective bargaining agreement does not survive in every case in which the ownership or corporate structure of an enterprise is changed. It does not survive where there is lack of any substantial continuity of identity in the business enterprise before and after a change, or where the union abandons its right to arbitration by failing to make its claims known. 6. CHANGE OF BARGAINING AGENT; SUBSTITUTIONARY DOCTRINE How does disaffiliation affect the CBA?
The agreement is binding on the parties for the period therein specified. The employees cannot revoke the validly executed collective bargaining contract with their employer by the simple expedient of changing their bargaining representative. Thus, when there occurs a shift in employees' union allegiance after the execution of a bargaining contract with their employer, and the employees change their bargaining representative, the contract continues to bind them up to its expiration date. The new agent, however, may bargain for the shortening of the contract period. In formulating the "substitutionary" doctrine, the only consideration involved was the employees' interest in the existing bargaining agreement. The agent's interest never entered the picture. In fact, the justification 9 for said doctrine was: xxx that the majority of the employees, as an entity under the statute, is the true party in interest to the contract, holding rights through the agency of the union representative. Thus, any exclusive interest claimed by the agent is defeasible at the will of the principal.... (Emphasis supplied) Stated otherwise, the "substitutionary" doctrine only provides that the employees cannot revoke the validly executed collective bargaining contract with their employer by the simple expedient of changing their bargaining agent. And it is in the light of this that the phrase "said new agent would have to respect said contract" must be understood. It only means that the employees, thru their new bargaining agent, cannot renege on their collective bargaining contract, except of course to negotiate with management for the shortening thereof. The "substitutionary" doctrine, therefore, cannot be invoked to support the contention that a newly certified collective bargaining agent automatically assumes all the personal undertakings — like the no-strike stipulation here — in the collective bargaining agreement made by the deposed union. When BBWU bound itself and its officers not to strike, it could not have validly bound also all the other rival unions existing in the bargaining units in question. BBWU was the agent of the employees, not of the other unions which possess distinct personalities. To consider UNION contractually bound to the no-strike stipulation would therefore violate the legal maxim that res inter alios nec prodest nec nocet.
7. GRIEVANCES A grievance is defined as “any question by either the employer or the union regarding the interpretation or application of the collective bargaining agreement or company personnel policies or any claim by either party that the other party is violating any provision of the CBA or company personnel policies.”
LABOR RELATIONS collective agreement. The usual source of grievances, however, is the rules and regulations governing disciplinary actions. 7.1 By-passing the Grievance Machinery: ULP All grievances arising from the implementation or interpretation of the collective bargaining agreement and/or interpretation and enforcement of company personnel policies are compulsorily subject to the grievance of machinery. Upholding the requirement, the Court has ruled that the grievance procedure provided in the CBA should be adhered to by the parties. Refusal or failure to do so is an unfair labor practice, because the grievance procedure is part of the continuous process of collective bargaining. It is intended to promote friendly dialogue between labor and management as a means of maintaining industrial peace. Before an aggrieved employee may resort to the courts to enforce his individual rights under a bargaining contract, the employee must exhaust all the remedies available to him under such contract. And a court should not entertain any complaint by an aggrieved employee until proper use has been made of the contract grievance procedure agreed upon by employer and the bargaining representative. The grievance machinery under the agreement is the very heart of industrial self0government. May a grievance be brought to voluntary arbitration without passing through the grievance procedure under the CBA? This appears to be proscribed by the Labor Code which directs the parties to a CBA to establish a grievance machinery for the adjustment and resolution of grievances arising from the interpretation or enforcement of company personnel policies. In view, however, of the State policy to encourage voluntary arbitration of all other labor-management disputes, it is submitted that a grievance may be brought directly to voluntary arbitration without passing through the grievance machinery, especially when the latter has been proven to be ineffective in the past, or when the parties inadvertently failed to include a grievance machinery provision in their CBA.
If the term grievance is to be applied in the loose or generic sense, any dispute or controversy respecting terms and conditions of employment which an employee or group of employees may present to the employer can be a grievance, even without a union or CBA.
7.2 Waiver of Grievance Machinery Procedure and Submission to VA
The expansion of the original and exclusive jurisdiction of voluntary arbitrators to include questions arising from the interpretation and enforcement of company personnel policies has the effect of widening the meaning and interpretation of a grievance to include a situation where there is no collective bargaining agent and no CBA.
Contrary to the finding of the Court of Appeals, voluntary arbitration as a mode of settling the dispute was not forced upon respondents. Both parties indeed agreed to submit the issue of validity of the dismissal of petitioner to the jurisdiction of the voluntary arbitrator by the Submission Agreement duly signed by their respective counsels. As the voluntary arbitrator had jurisdiction over the parties' controversy, discussion of the second issue is no longer necessary.
Personnel policies are guiding principles stated in broad, long-range terms that express the philosophy or beliefs of an organization’s top authority regarding personnel matters. They deal with matters affecting efficiency and well-being of employees and include, among others, the procedures in administration of wages, benefits, promotions, transfer and other personnel movements which are usually not spelled out in the
Article 262 of the Labor Code provides that upon agreement of the parties, the voluntary arbitrator can hear and decide all other labor disputes.
The employee’s waiver of her option to submit her case to grievance machinery did not amount to relinquishing her right to avail herself of voluntary arbitration.
7.3 Structure and Procedure In the absence of applicable provision in the collective bargaining agreement, a grievance committee shall be created within ten (10) days from signing of the collective bargaining agreement. The committee shall be composed of at least
LABOR RELATIONS two (2) representatives each from the members of the bargaining unit and the employer, unless otherwise agreed upon by the parties. The representatives from among the members of the bargaining unit shall be designated by the union.
choice and by consent submit their controversy to him for determination. Under voluntary arbitration, on the other hand, referral of a dispute by the parties is made, pursuant to a voluntary arbitration clause in their collective agreement, to an impartial third person for a final and binding resolution.
Section 2. Procedure in handling grievances. - In the absence of a specific provision in the collective bargaining agreement or existing company practice prescribing for the procedures in handling grievance, the following shall apply:
Ideally, arbitration awards are supposed to be complied with by both parties without delay, such that once an award has been rendered by an arbitrator, nothing is left to be done by both parties but to comply with the same. After all, they are presumed to have freely chosen arbitration as the mode of settlement for that particular dispute. Pursuant thereto, they have chosen a mutually acceptable arbitrator who shall hear and decide their case. Above all, they have mutually agreed to de bound by said arbitrator's decision.
(a) An employee shall present this grievance or complaint orally or in writing to the shop steward. Upon receipt thereof, the shop steward shall verify the facts and determine whether or not the grievance is valid. (b) If the grievance is valid, the shop steward shall immediately bring the complaint to the employee's immediate supervisor. The shop steward, the employee and his immediate supervisor shall exert efforts to settle the grievance at their level. (c) If no settlement is reached, the grievance shall be referred to the grievance committee which shall have ten (10) days to decide the case. Where the issue involves or arises from the interpretation or implementation of a provision in the collective bargaining agreement, or from any order, memorandum, circular or assignment issued by the appropriate authority in the establishment, and such issue cannot be resolved at the level of the shop steward or the supervisor, the same may be referred immediately to the grievance committee.
8. VOLUNTARY ARBITRATION Section 3. Submission to voluntary arbitration. - Where grievance remains unresolved, either party may serve notice upon the other of its decision to submit the issue to voluntary arbitration. The notice shall state the issue or issues to be arbitrated, copy thereof furnished the board or the voluntary arbitrator or panel of voluntary arbitrators named or designated in the collective bargaining agreement. If the party upon whom the notice is served fails or refuses to respond favorably within seven (7) days from receipt thereof, the voluntary arbitrator or panel of voluntary arbitrators designated in the collective bargaining agreement shall commence voluntary arbitration proceedings. Where the collective bargaining agreement does not so designate, the board shall call the parties and appoint a voluntary arbitrator or panel of voluntary arbitrators, who shall thereafter commence arbitration proceedings in accordance with the proceeding paragraph. In instances where parties fail to select a voluntary arbitrator or panel of voluntary arbitrators, the regional branch of the Board shall designate the voluntary arbitrator or panel of voluntary arbitrators, as may be necessary, which shall have the same force and effect as if the parties have selected the arbitrator.
The parties to a CBA will decide on the number of arbitrators who may hear a dispute only when the need for it arises. Even the law itself does not specify the number of arbitrators. Their alternatives — whether to have one or three arbitrators — have their respective advantages and disadvantages. In this matter, cost is not the only consideration; full deliberation on the issues is another, and it is best accomplished in a hearing conducted by three arbitrators. In effect, the parties are afforded the latitude to decide for themselves the composition of the grievance machinery as they find appropriate to a particular situation. Labor arbitration is the reference of a labor dispute to a third party for determination on the basis of evidence and arguments presented by such parties, who are bound to accept the decision. Voluntary arbitration has been defined as a contractual proceeding whereby the parties to any dispute or controversy, in order to obtain a speedy and inexpensive final disposition of the matter involved, select a judge of their own
Compulsory arbitration is a system whereby the parties to a dispute are compelled by the government to forego their right to strike and are compelled to accept the resolution of their dispute through arbitration by a third party. 1 The essence of arbitration remains since a resolution of a dispute is arrived at by resort to a disinterested third party whose decision is final and binding on the parties, but in compulsory arbitration, such a third party is normally appointed by the government. In Philippine context, the “judge” in voluntary arbitration is called arbitrator, while that in compulsory is labor arbiter. The jurisdiction of a VA is stated in Articles 261 and 262 while that of an LA is in Article 217.
8.1 Voluntary Arbitration: A Private Judicial System A voluntary arbitrator “is not a public tribunal imposed upon the parties by a superior authority which the parties are obliged to accept. He has no general character to administer justice for a community which transcends the parties. He is rather part of a system of selfgovernment created by and confined to the parties.” The primary function of voluntary labor arbitration is to provide (1) a process for the orderly disposition of disputes and (2) a foundation for stable labor-management relations. 8.2 Voluntary Arbitration: A Master Procedure In labor-management relations voluntary arbitration is a master procedure. Any and all kinds of labor disputes may be submitted to, settled, or resolved through voluntary arbitration, if the parties so desire. Money claims, bargaining deadlocks, strike or lockout, employment termination, and even questions about existence or absence of employer-employee relationship, may be resolved by the parties—with finality—by availing themselves of voluntary arbitration. As a master procedure voluntary arbitration takes precedence over other dispute settlement devices (i.e., cases before the labor arbiter or Secretary of Labor or the NLRC) A dispute pending in voluntary arbitration (or compulsory arbitration, for that matter) cannot be the subject of a strike or lockout notice. 9. WHO MAY ARBITRATOR
The following are the minimum criteria for accreditation as voluntary arbitrator: 1. A Filipino citizen residing in the Philippines; 2. A holder of at least a Bachelor’s Degree in any field of behavioral or applied sciences or equivalent educational training short of a Bachelor’s Degree;
3. At least five (5) years experience in the field of Labor-Management relations; 4. Completion of a training course on voluntary arbitration conducted by the Board; and 5. A person of good moral character, noted for impartiality, probity, and has not been civilly, criminally and administratively adjudged guilty of any offense involving moral turpitude as evidenced by a duly sworn affidavit.
10. HOW VOLUNTARY ARBITRATOR IS CHOSEN A voluntary arbitrator is chosen by the parties themselves (preferably accredited by the NCMB). The choice is usually influenced by the trust in the person’s fairness and knowledge of the dynamics, including law, of labor-management relation. The preferred method of selection is by mutual agreement of the parties. Alternative methods include the selection or appointment by an administrative agency like the NCMB. Parties in general may choose between the use of a temporary (when a dispute is already at hand; specific) or permanent arbitrator (before a dispute arises; for a period of time, usually during the life of the CBA). They have also a choice as to the number of arbitrators, either a sole arbitrator or a panel of arbitrators or Arbitration Board. 11. DISTINGUISHED FROM A COURT OF LAW Court of Law Formal Follow precedents Rules of evidence observed Decisions may be appealed to the higher court Hear a great variety of cases Services of a lawyer is essential due to complexity
Arbitration Informal Not obliged Not observed No comparable appeal recourse Hear only industrial disputes Not essential
Arbitration, in sum, is a non-technical and relatively inexpensive procedure for obtaining a quick solution to industrial disputes by persons who have specialized knowledge of labor management relations. ________ Article. 261. Jurisdiction of Voluntary Arbitrators or panel of Voluntary Arbitrators. - The Voluntary Arbitrator or panel of Voluntary Arbitrators shall have original and exclusive jurisdiction to hear and decide all unresolved grievances arising from the interpretation or implementation of the Collective Bargaining Agreement and those arising from the interpretation or enforcement of company personnel policies referred to in the immediately preceding article. Accordingly, violations of a Collective Bargaining Agreement, except those which are gross in character, shall no longer be treated as unfair labor practice and shall be resolved as grievances under the Collective Bargaining Agreement. For purposes of this article, gross violations of Collective Bargaining Agreement shall mean flagrant and/or malicious refusal to comply with the economic provisions of such agreement. The Commission, its Regional Offices and the Regional Directors of the Department of Labor and Employment shall not entertain disputes, grievances or matters under the exclusive and original jurisdiction of
LABOR RELATIONS the Voluntary Arbitrator or panel of Voluntary Arbitrators and shall immediately dispose and refer the same to the Grievance Machinery or Voluntary Arbitration provided in the Collective Bargaining Agreement. ________ Article. 262. Jurisdiction over other labor disputes. - The Voluntary Arbitrator or panel of Voluntary Arbitrators, upon agreement of the parties, shall also hear and decide all other labor disputes including unfair labor practices and bargaining deadlocks. ________ 1. ARBITRABLE DISPUTES In the field of labor relations, arbitration applies to two kinds of disputes: (1) contract-negotiation disputes; and (2) contractinterpretation disputes. Contract negotiation disputes are disputes as to the terms of a collective bargaining agreement. Where there is an existing agreement to arbitrate such disputes, and a bargaining deadlock or impasse has arisen, the disputants submit to an impartial outsider for settlement the collective bargaining issue which they had been unable to settle by themselves, whether or not aided by conciliators. Contract interpretation disputes are disputes arising under an existing collective bargaining agreement, involving such matters as the interpretation and application of the contract, or alleged violation of its provisions. Arbitration of contract negotiation disputes is often known as arbitration of “interest,” while arbitration of contract interpretation disputes is known as arbitration of “grievance” or “rights.” 2. JURISDICTION OF L.A. AND V.A. The aforecited provisions of law cannot be read in isolation or separately. They must be read as a whole and each Article of the Code reconciled one with the other. An analysis of the provisions of Articles 217, 261, and 262 indicates, that: 1. The jurisdiction of the Labor Arbiter and Voluntary Arbitrator or Panel of Voluntary Arbitrators over the cases enumerated in Articles 217, 261 and 262, can possibly include money claims in one form or another. 2. The cases where the Labor Arbiters have original and exclusive jurisdiction are enumerated in Article 217, and that of the Voluntary Arbitrator or Panel of Voluntary Arbitrators in Article 261. 3. The original and exclusive jurisdiction of Labor Arbiters is qualified by an exception as indicated in the introductory sentence of Article 217 (a), to wit: Art. 217. Jurisdiction of Labor Arbiters . . . (a) Except as otherwise provided under this Code the Labor Arbiter shall have original and exclusive jurisdiction to hear and decide . . . the following cases involving all workers. . . . The phrase "Except as otherwise provided under this Code" refers to the following exceptions: A. Art. 217. Jurisdiction of Labor Arbiters . . . xxx (c) Cases arising from the interpretation or implementation of collective bargaining agreement and those arising from the interpretation or enforcement of company procedure/policies shall be disposed of by the Labor Arbiter by referring the same to the grievance machinery and voluntary arbitrator as may be provided in said agreement.
LABOR RELATIONS B. Art. 262. Jurisdiction over other labor disputes. — The Voluntary Arbitrator or panel of Voluntary Arbitrators, upon agreement of the parties, shall also hear and decide all other labor disputes including unfair labor practices and bargaining deadlocks. 4. The jurisdiction of Voluntary Arbitrator or Panel of Voluntary Arbitrators is provided for in Arts. 261 and 262 of the Labor Code as indicated above. A. A close reading of Article 261 indicates that the original and exclusive jurisdiction of Voluntary Arbitrator or Panel of Voluntary Arbitrators is limited only to: . . . unresolved grievances arising from the interpretation or implementation of the Collective Bargaining Agreement and those arising from the interpretation or enforcement of company personnel policies . . . Accordingly, violations of a collective bargaining agreement, except those which are gross in character, shall no longer be treated as unfair labor practice and shall be resolved as grievances under the Collective Bargaining Agreement. . . . . B. Voluntary Arbitrators or Panel of Voluntary Arbitrators, however, can exercise jurisdiction over any and all disputes between an employer and a union and/or individual worker as provided for in Article 262. It must be emphasized that the jurisdiction of the Voluntary Arbitrator or Panel of Voluntary Arbitrators under Article 262 must be voluntarily conferred upon by both labor and management. The labor disputes referred to in the same Article 262 can include all those disputes mentioned in Article 217 over which the Labor Arbiter has original and exclusive jurisdiction. As shown in the above contextual and wholistic analysis of Articles 217, 261, and 262 of the Labor Code, the National Labor Relations Commission correctly ruled that the Labor Arbiter had no jurisdiction to hear and decide petitioner's money-claim-underpayment of retirement benefits, as the controversy between the parties involved an issue "arising from the interpretation or implementation" of a provision of the collective bargaining agreement. The Voluntary Arbitrator or Panel of Voluntary Arbitrators has original and exclusive jurisdiction over the controversy under Article 261 of the Labor Code, and not the Labor Arbiter.
policies. Note the phrase "unresolved grievances." In the case at bar, the termination of petitioner is not an unresolved grievance. Article 260 further provides that the parties to a CBA shall name or designate their respective representative to the grievance machinery and if the grievance is unsettled in that level, it shall automatically be referred to the voluntary arbitrators designated in advance by the parties to a CBA of the union and the company. It can thus be deduced that only disputes involving the union and the company shall be referred to the grievance machinery or voluntary arbitrators.
2.1a “Policies,” “Rules,” “Procedures” Policies are formulated by management even before a company opens for business in order to guide the men in the operational level, the line manager or supervisor as to the scope of their activities, authority and responsibility, and to enable them to arrive at sound decisions. Policies are valuable in fixing definite objectives for the organization. Policy statements are also needed to allow subordinate executives to make fair and consistent decisions on recurrent problems. They promote uniformity of action and prevent conflicting decisions especially as regards labor matter.” Company policies must be issued by top management which is responsible for making major policies that are by nature companywide in application. Minor policies, better known as rules and procedures, are the extension of major policies and are usually formulated by minor executives or department managers. Rules are specific guides intended to govern conduct and action of operating supervisors and employees in the performance of their designated activities. Procedures are made to specify ways or methods of carrying out policies and rules. A procedure tells what work or task to do, how to do it, and when to do it. 2.2 Jurisdiction over CBA Violations
2.1 Jurisdiction over Termination Disputes The preference or bias of the law in favor of voluntary arbitration justifies the view that employment termination disputes, arising from CBA or personnel policy implementation, are cognizable by a voluntary arbitrator and not a labor arbiter. Such termination cases, if filed with a labor arbiter, is to be dismissed for lack of jurisdiction and referred to the concerned NCMB Regional Branch for appropriate action. Article 260 of the Labor Code on grievance machinery and voluntary arbitrator states that "(t)he parties to a Collective Bargaining Agreement shall include therein provisions that will ensure the mutual observance of its terms and conditions. They shall establish a machinery for the adjustment and resolution of grievances arising from the interpretation or implementation of their Collective Bargaining Agreement and those arising from the interpretation or enforcement of company personnel policies." It is further provided in said article that the parties to a CBA shall name or designate their respective representatives to the grievance machinery and if the grievance is not settled in that level, it shall automatically be referred to voluntary arbitrators (or panel of voluntary arbitrators) designated in advance by the parties. It need not be mentioned that the parties to a CBA are the union and the company. Hence, only disputes involving the union and the company shall be referred to the grievance machinery or voluntary arbitrators. Article 261 of the Labor Code which grants to voluntary arbitrators original and exclusive jurisdiction to hear and decide all unresolved grievances arising from the interpretation or implementation of the collective bargaining agreement and those arising from the interpretation or enforcement of company personnel
CBA violations not constituting ULP are likewise cognizable by a voluntary arbitrator if not resolved through the grievance machinery. If the violations, however, are “gross” in character, these are to be treated as unfair labor practice which, following Art. 217 (a-1), are to be heard and decided by a labor arbiter. The law wants the industrial players to resolve their differences by and among themselves as much as possible. And if they need help, they are likewise free to agree where that help may come from. For a ULP case to be cognizable by the Labor Arbiter, and the NLRC to exercise its appellate jurisdiction, the allegations in the complaint should show prima facie the concurrence of two things, namely: (1) gross violation of the CBA; AND (2) the violation pertains to the economic provisions of the CBA. Unsubstantiated conclusions of bad faith and unjustified refusal to re-employ petitioners, to our mind, do not constitute gross violation of the CBA for purposes of lodging jurisdiction with the Labor Arbiter and the NLRC. Although evidentiary matters are not required (and even discouraged) to be alleged in complaint, still, sufficient details supporting the conclusion of bad faith and unjust refusal to re-employ petitioners must be indicated. Furthermore, it is even doubtful if the CBA provision on re-employment fits into the accepted notion of an economic provision of the CBA.
2.3 Other Cases Section 4. Jurisdiction of voluntary arbitrator or panel of voluntary arbitrators. The voluntary arbitrator or panel of voluntary arbitrators shall have exclusive
LABOR RELATIONS and original jurisdiction to hear and decide all grievances arising from the implementation or interpretation of the collective bargaining agreements and those arising from the interpretation or enforcement of company personnel policies which remain unresolved after exhaustion of the grievance procedure. They shall also have exclusive and original jurisdiction, to hear and decide wage distortion issues arising from the application of any wage orders in organized establishments, as well as unresolved grievances arising from the interpretation and implementation of the productivity incentive programs under RA 6971. Upon agreement of the parties, any other labor dispute may be submitted to a voluntary arbitrator or panel of voluntary arbitrators. Before or at any stage of the compulsory arbitration process, the parties may opt to submit their dispute to voluntary arbitration. The National Labor Relations Commission, its regional branches and Regional Directors of the Department of Labor and Employment shall not entertain disputes, grievances or matters under the exclusive and original jurisdiction of the voluntary arbitrator or panel of voluntary arbitrators and shall immediately dispose and refer the same to the appropriate grievance machinery or voluntary arbitration provided in the collective bargaining agreement.
2.4 Dispute over Company’s Drug Abuse Policy A union’s petition to enjoin implementation of the company’s drug policy is a labor dispute beyond RTC’s jurisdiction. It is a personnel policy dispute within the jurisdiction of a VA.
3. HOW VOLUNTARY ARBITRATION IS INITIATED Voluntary arbitration may be initiated either by 1) a Submission or 2) by a Demand or Notice invoking a collective agreement arbitration clause. Sometimes both instruments are used in a case. Submission is sometimes called a “Stipulation” or an “Agreement to Arbitrate.” It is used where there is no previous agreement to arbitrate. The Submission, which must be signed by both parties, describes an existing dispute; it often names the arbitrator, procedures in the hearing and it sometimes contains considerable details of the arbitrator’s authority and other matters which the parties wish to control. Submission is more appropriate in interest disputes since collective agreement generally do not provide for the arbitration of such disputes that may arise in the future. Submission is often entered into after the dispute has materialized and the issues can already be defined. However, Demand or Notice of Intent to Arbitrate is more applicable to rights dispute because collective agreements are required under RA 6715 to provide for a grievance procedure and a voluntary arbitration clause with respect to disputes arising from the application or interpretation of the agreement. Thus, there is an “agreement to arbitrate” future dispute that may arise under and during the term of the CBA. If a dispute is covered by such an arbitration clause, arbitration may be initiated unilaterally by one party by serving upon the other a written demand or notice of intent to arbitrate. 3.1 The Submission Agreement; Extent of Arbitrator’s Authority Although the contract may establish the breadth of the arbitrator’s power and the limits of his authority, his power may be more sharply defined in the submission agreement. Frequently, the parties jointly formulate in writing the specific issues to be decided by the arbitrator. Sometimes the arbitrator is asked by the parties to help them frame the issue on the basis of the written grievance or the case as presented.
In general, the arbitrator is expected to decide those questions expressly stated and limited in the submission agreement. However, since arbitration is the final resort for the adjudication of disputes, the arbitrator will assume that he has the power to make a final settlement. It is thus essential to stress that the Voluntary Arbitrator had plenary jurisdiction and authority to interpret the agreement to arbitrate and to determine the scope of hs own authority subject only, in a proper case, to the certiorari jurisdiction of this Court. Generally, the arbitrator is expected to decide only those questions expressly delineated by the submission agreement. Nevertheless, the arbitrator can assume that he has the necessary power to make a final settlement since arbitration is the final resort for adjudication of disputes. The issue of regularization should be viewed as two-tiered issue. While the submission agreement mentioned only the determination of the date or regularization, law and jurisprudence give the voluntary arbitrator enough leeway of authority as well as adequate prerogative to accomplish the reason for which the law on voluntary arbitration was created – speedy labor justice. It bears stressing that the underlying reason why this case arose is to settle, once and for all, the ultimate question of whether respondent employees are entitled to higher benefits. To require them to file another action for payment of such benefits would certainly undermine labor proceedings and contravene the constitutional mandate providing full protection to labor.
4. POWERS OF THE ARBITRATOR The study of collective bargaining agreements discloses different types of arbitration clauses with varying degrees of power granted to the arbitration. This power may be very limited or unusually broad in scope. 4.1 Power to Arbitrate Any Dispute The contract clause that gives the arbitrator the broadest scope of power is commonly known as the “disputes” clause. This type of clause grants the arbitrator jurisdiction to hear and determine practically any matter in dispute between the parties. Moreover, he is not necessarily limited to matters specifically stated in the contract. It is common, however, for some relationship to be shown between the matter in dispute and the provisions of the contract. 4.2 No Power to Add To or Subtract From the Contract Some arbitration clauses limit the arbitrator’s power to an interpretation and application of the contract and further specifically provide that he “shall have no power to add to or subtract from the contract. Such clauses clearly state the parties’ intention that the arbitrator will be empowered only to interpret the contract but not add to or modify it. As a general rule, the authority of an arbitrator embraces or covers the following:
1. General authority to investigate and hear the case upon notice of the parties and to render an award based on the contract and record of the case; 2. Incidental authority to perform all acts necessary to an adequate discharge of his duties and responsibilities like setting and conduct of hearing, attendance of witnesses and proof documents and other evidences, fact-finding and other modes of discovery, reopening of hearing, etc.; 3. Special power in aid of his general contractual authority like the authority to determine arbitrability of any particular dispute and to modify any provision of existing agreement upon which a proposed change is submitted for arbitration.
LABOR RELATIONS All parties to the dispute shall be entitled to attend the arbitration proceedings. The attendance of any third party or the exclusion of any witness from the proceedings shall be determined by the Voluntary Arbitrator or panel of Voluntary Arbitrators. Hearing may be adjourned for cause or upon agreement by the parties. Unless the parties agree otherwise, it shall be mandatory for the Voluntary Arbitrator or panel of Voluntary Arbitrators to render an award or decision within twenty (20) calendar days from the date of submission of the dispute to voluntary arbitration. The award or decision of the Voluntary Arbitrator or panel of Voluntary Arbitrators shall contain the facts and the law on which it is based. It shall be final and executory after ten (10) calendar days from receipt of the copy of the award or decision by the parties.
5. FUNCTIONS OF ARBITRATOR The labor arbitrator under a collective bargaining agreement is an indispensable agency in the continuous collective bargaining process. He sits to settle disputes at the plant level—disputes which require for their solution knowledge of the custom and practices of a particular factory or of a particular industry as reflected in particular agreements. On the other hand, the power and authority of arbitrators in labor dispute cases is derived from and limited by the terms of the parties’ agreement. The arbitrator is confined to interpretation and application of the CBA; he does not sit to dispense his own brand of industrial justice. The arbitrator’s authority is contractual rather than judicial in nature; his power is conferred by the CBA; and his duty with respect to that agreement is to settle disputes arising thereunder by applying and interpreting that agreement. But so long as an arbitrator is not arbitrary, he has wide latitude in exercising his authority, especially in fashioning an appropriate remedy. 5.1 Arbitrator’s Interpretation of CBA It is said that an arbitral award does not draw its essence from the CBA; hence, there is an unauthorized amendment or alteration thereof, if: 1. It is so unfounded in reason and fact; 2. It is so unconnected with the working and purpose of the agreement; 3. It is without factual support in view of its language, its context, and any other indicia of the parties' intention; 4. It ignores or abandons the plain language of the contract; 5. It is mistakenly based on a crucial assumption which concededly is a nonfact; 6. It is unlawful, arbitrary or capricious; and 7. It is contrary to public policy.
________ Article. 262-A. Procedures. - The Voluntary Arbitrator or panel of Voluntary Arbitrators shall have the power to hold hearings, receive evidences and take whatever action is necessary to resolve the issue or issues subject of the dispute, including efforts to effect a voluntary settlement between parties.
Upon motion of any interested party, the Voluntary Arbitrator or panel of Voluntary Arbitrators or the Labor Arbiter in the region where the movant resides, in case of the absence or incapacity of the Voluntary Arbitrator or panel of Voluntary Arbitrators, for any reason, may issue a writ of execution requiring either the sheriff of the Commission or regular courts or any public official whom the parties may designate in the submission agreement to execute the final decision, order or award. ________ 1. COMPLIANCE WITH DUTY TO ARBITRATE If a CBA requires settlement of disputes “exclusively” by the arbitration, then arbitration is needed before court suits for breach of the contract may be filed. Nonetheless, the parties to a CBA may waive the arbitration covenants of the agreement, but their conduct must clearly show that intention. 2. WHO DETERMINES THE ARBITRATION PROCEDURES In practice, voluntary arbitration of labor cases use procedures based on the Labor Code as amended by RA 6715 and its Implementing Rules, the CBA, and other agreements of the parties, the directives of the arbitrator, and the procedural rules of appropriate agencies like the NCMB Procedural Guidelines in Conduct of Voluntary Arbitration Proceedings. 3. ETHICAL STANDARDS OF ARBITRATORS An arbitrator is obliged to maintain a high level of professional ethics in his relationship with the parties and the appointing agencies. He also has a responsibility to society. His conduct should be above reproach. Since in effect, he is a judge, and his ethics must be on the same high level as the code that governs the conduct of judicial tribunals. Failure on the part of the voluntary arbitrator to render a decision, resolution, order or award within the prescribed period, shall upon complaint of a party, be sufficient ground for the Board to discipline said voluntary arbitrator, pursuant to the guidelines issued by the Secretary. In cases that the recommended sanction is de-listing, it shall be unlawful for the voluntary arbitrator to refuse or fail to turn over to the board, for its further disposition, the records of the case within ten (10) calendar days from demand thereof.
4. VOLUNTARY ARBITRATION AWARD GENERALLY FINAL; EXCEPTIONS
LABOR RELATIONS The decisions of voluntary arbitrators must be given the highest respect and as a general rule must be accorded a certain measure of finality. This is especially true where the arbitrator chosen by the parties enjoys the first rate credentials. It is not correct, however, that this respect precludes the exercise of judicial review over their decisions. Inspite of statutory provisions making 'final' the decisions of certain administrative agencies, we have taken cognizance of petitions questioning these decisions where want of jurisdiction, grave abuse of discretion, violation of due process, denial of substantial justice, or erroneous interpretation of the law were brought to our attention.
4.3 Findings of Facts of a Voluntary Arbitrator ________ Article. 262-B. Cost of voluntary arbitration and Voluntary Arbitrator’s fee. - The parties to a Collective Bargaining Agreement shall provide therein a proportionate sharing scheme on the cost of voluntary arbitration including the Voluntary Arbitrator’s fee. The fixing of fee of Voluntary Arbitrators, whether shouldered wholly by the parties or subsidized by the Special Voluntary Arbitration Fund, shall take into account the following factors:
A voluntary arbitrator by the nature of her fucntions acts in quasi-judicial capacity. There is no reason why herdecisions involving interpretation of law should be beyond this Court's review. Administrative officials are presumed to act in accordance with law and yet we do hesitate to pass upon their work where a question of law is involved or where a showing of abuse of authority or discretion in their official acts is properly raised in petitions for certiorari.
(a) Nature of the case;
The Labor Code and its Implementing Rules thus clearly reflect the important public policy of encouraging recourse to voluntary arbitration and of shortening the arbitration process by rendering the arbitral award non- appealable to the NLRC. The result is that a voluntary arbitral award may be modified and set aside only upon the same grounds on which a decision of the NLRC itself may be modified or set aside, by the Supreme Court.
(d) Capacity to pay of the parties; and
4.1 Motion for Reconsideration* Section 7. Finality of Award/Decision. - The decision, order, resolution or award of the voluntary arbitrator or panel of voluntary arbitrators shall be final and executory after ten (10) calendar days from receipt of the copy of the award or decision by the parties and it shall not be subject of a motion for reconsideration.
4.2 Review of Award by Certiorari The voluntary arbitrator no less performs a state function pursuant to a governmental power delegated to him under the provisions therefor in the Labor Code and he falls, therefore, within the contemplation of the term "instrumentality" in the aforequoted Sec. 9 of B.P. 129. The fact that his functions and powers are provided for in the Labor Code does not place him within the exceptions to said Sec. 9 since he is a quasi-judicial instrumentality as contemplated therein. A fortiori, the decision or award of the voluntary arbitrator or panel of arbitrators should likewise be appealable to the Court of Appeals, in line with the procedure outlined in Revised Administrative Circular No. 1-95, just like those of the quasi-judicial agencies, boards and commissions enumerated therein. In effect, this equates the award or decision of the voluntary arbitrator with that of the regional trial court. Consequently, in a petition for certiorari from that award or decision, the Court of Appeals must be deemed to have concurrent jurisdiction with the Supreme Court. As a matter of policy, this Court shall henceforth remand to the Court of Appeals petitions of this nature for proper disposition.
4.2a From VA to CA: Mode of Appeal is Rule 43, not 65 The mode of appeal from VA to the CA is therefore Rule 43 of the 1997 Rules of Procedure. It is not Rule 65 because a petition for certiorari under that Rule lies only where there is “no appeal” and no plain, speedy and adequate remedy in the ordinary course of law. Certiorari under Rule 65 cannot be allowed when a party to a case fails to appeal a judgment despite the availability of that remedy, certiorari not being a substitute for lost appeal. The remedies of appeal and certiorari are mutually exclusive and not alternative or successive.
(b) Time consumed in hearing the case; (c) Professional standing of the Voluntary Arbitrator;
(e) Fees provided for in the Revised Rules of Court. ________