Labrel Digests- Set 1

LABOR RELATIONS CASES-MSU |1 CASES: 1) La suerte v. director of BLR 123 scra 679; 2) Univ of pangasinan v. NLRC 218 scra 65; 3) UST v. Bitonio, 318 scra 185; 4) Victoriano v. Elizalde rope workers 59 scra 54; 5) BPI v. Bpi employees Aug 10, 2010; 6) Natu v. Torres 239 scra 546; 7) San Miguel v. Laguesma 277 scra 370; 8) Tunay na Pagkakaisa v. Asia brewery Aug 3, 2010 9) Pepsi v. Sec of labor Aug 10, 1999 10) Philips v. NLRC 210 scra 339; 11) Golden farms v. Calleja 175 scra 471; 12) National assoc v. Torres 239 scra 546; 13) Pier 8 v. Roldan-confesor 241 scra 294; 14) Metrolab v. Roldan-confesor 254 scra 182; 15) Arizala v. CA 189 scra 584; 16) Camporedondo v. NLRC, Aug 6, 1999. 17) Cooperative rural bank v Calleja Sept 26, 1988; 18) Republic v. Asiapro coop. Nov 23, 2007; 19) Int’l Catholic v. Calleja 190 scra 130; 20) German agency v. CA April 16, 2009; 21) Heritage hotel v. National union, Jan 12, 2011; 22) S.S. Ventures v. S.S. Ventures union 559 scra 435; 23) Toyota v. Toyota union 268 scra 571; 24) Tagaytay highlands v. Tagaytay union 395 scra 699; 25) Mariwasa v. Sec of labor g.r.no. 183317 dec 21, 2009; 26) Eagle ridge v. CA GR No. 178989 mar 18, 2010; 27) Heritage hotel v. Piglas GR No. 177024 Oct 30, 2009; 28) Liberty cotton v. Liberty cotton Mills 66 scra 512; 29) Associated labor v. NLRC 188 scra 123; 30) Benguet v. BCI union 3 scra 471

LADJIMAN

SUMMARY: In the determination of the basic issue raised in the "control test" earlier laid down in Investment Planning Corp. vs. Social Security System, 21 SCRA 924, and in Social Security System vs. Hon. Court of Appeals and Shriro (Phils.) Inc., 37 SCRA 579 are authoritative and controlling. 4 fold-test: (1) the selection and engagement of the employee; (2) the payment of wages; (3) the power of dismissal; and (4) the power to control the employees' conduct-although the latter is the most important element. Factors to determine existence of independent contract relationship.— An independent contractor is one who exercises independent employment and contracts to do a piece of work according to his own methods and without being subject to control of his employer except as to the result of the work. ' Among the factors to be considered are whether the contractor is carrying on an independent business;

G.R. No. L-55674 July 25, 1983 LA SUERTE CIGAR AND CIGARETTE FACTORY, vs. DIR. BUREAU OF LABOR RELATIONS, THE LA SUERTE CIGAR AND CIGARETTE FACTORY PROVINCIAL (Luzon) AND METRO MANILA SALES FORCE ASSOCIATION-NATU, and THE NATIONAL ASSOCIATION OF TRADE UNIONS, . ISSUE: Whether the employees of petitioner company in which case they should be included in the 30% jurisdictional requirement necessary to support the petition for certification election, or independent contractors and hence, excluded therefrom

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whether the work is part of the employer's general business; the nature and extent of the work; the skill required; the term and duration of the relationship; the right to assign the performance of the work to another; the power to terminate the relationship; the existence of a contract for the performance of a specified piece of work; the control and supervision of the work; the employer's powers and duties with respect to the hiring, firing, and payment of the contractor's servants;

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C AS E S - M S U |2 

the control of the premises; the duty to supply the premises, tools, appliances, material and labor, and the mode, manner, and terms of payment.'

“whether the employer controls or has reserved the right to control the employee not only as to the result of the work to be done but also as to the means and methods by which the same is to be accomplished.” FACTS: On 1979, the La Suerte Cigar and Cigarette Factory Provincial (Luzon) and Metro Manila Sales Force Association (union) for and was granted chapter status by the National Association of Trade Unions (NATU). Thereafter, 31 local members signed a joined letter withdrawing their membership from NATU. On April 18, 1979, the local union and NATU filed a petition for direct certification or certification election which alleged among others, that forty-eight of the sixty sales personnel of the Company were members of the local union; that the petition is supported by no less than 75% of the sales force; that there is no existing recognized labor union in the Company representing the said sales personnel; that there is likewise no existing collecting bargaining agreement; and that there had been no certification election in the last twelve months preceding the filing of the petition. Company’s argument: No EE-ER relationship Filed a motion to dismiss the petition on the ground that it is not supported by at least 30% of the members of the proposed bargaining unit because (a) of the alleged forty-eight (48) members of the local union, thirty-one (31) had withdrawn prior to the filing of the petition; and (b) fourteen (14) of the alleged members of the union were not employees of the Company but were independent contractors. NATU & union’s: argument:

NATU and the local union opposed the Company's motion to dismiss alleging that the fourteen dealers are actually employees of the Company because they are subject to its control and supervision. On August 29, 1979, the Med-Arbiter issued an order dismissing the petition for lack of merit as the fourteen dealers who joined the union should not be counted in determining the 30% consent requirement because they are not employees but independent contractors and the withdrawal of the 31 salesmen from the union prior to the filing of the petition for certification election was uncontroverted by the parties. ISSUES: 1. W/N the 14 dealers are employees or independent contractors. Yes, Independent Contractor. 2. W/N the withdrawal of 31 union members from the NATU affected the petition for certification election insofar as the thirty per cent requirement is concerned; Yes. While there might be force or duress of withdrawal, this must be proven. 3. W/N the withdrawal of the petition for certification election by the NATU, through its President and legal counsel, was valid and effective. RULING: We hold and rule that the 14 members of respondent local union are dealers or independent contractors. They are not employees of petitioner company. With the withdrawal by 31 members of their support to the petition prior to or before the filing thereof, making a total of 45, the remainder of 3 out of the 48 alleged to have supported the petition can hardly be said to represent the union. Hence, the dismissal of the petition by the Med-Arbiter was correct and justified. Respondent Director committed grave abuse of discretion in reversing the order of the MedArbiter. Failure to establish this juridical relationship between the union members

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

LAB OR R ELAT IONS C AS ES - MS U |3 and the employer affects the legality of the union itself. It means the ineligibility of the union members to present a petition for certification election as well as to vote therein It is important in the determination of who shall be included in a proposed bargaining unit because it is the sine qua non, the fundamental and essential condition that a bargaining unit be composed of employees. Corollarily, when a petition for certification election is supported by 48 signatories in a bargaining unit composed of 60 salesmen, but 14 of the 48 lacks employee status, the petition is vitiated thereby. Herein lies the importance of resolving the status of the dealers in this case. Status thereby created is one of independent contractorship, pursuant to the first rule in the interpretation of the signed Dealership contracts It is likewise immediately noticeable that no such words as "to hire and employ" are present. The Dealership Agreement uses the words "the factory has accepted the application of (name of applicant) and therefore has appointed him as one of its dealers"; whereas the Dealership Supplementary Agreement is prefaced with the statement: "For and in consideration of the mutual covenants and agreements made herein, by one to the other, the COMPANY and the DEALER by these presents, enter into this Supplementary Agreement whereby the COMPANY will avail of the services of the DEALER to handle the sale and distribution of the cigarette products". Nothing in the terms and conditions likewise reveals that the dealers were engaged as employees. No Mention of Wage payment- Indication of non-existence of EE-ER relationship 'Wage' paid to any employee shall mean the remuneration or earnings, however designated, capable of being expressed in terms of money, whether fixed or ascertained on a time, task, piece, commission basis, or other method of calculating the same, which is payable by an employer under a written or

unwritten contract of employment for work done or to be done or for services rendered or to be rendered, and includes the fair and reasonable value, as determined by the Secretary of Labor, of board, lodging, or other facilities customarily furnished by the employer to the employee ... Precisely, there was need to change the contract of employment because of the change of relationship, from an employee to that of an independent dealer or contractor. The employees were free to enter into the new status, to sign or not to sign the new agreement. As in the Mafinco case, the respondents therein as in the instant case, were free to reject the terms of the dealership but having signed it, they were bound by its stipulations and the consequences thereof under existing labor laws. The fact that the 14 local union members voluntarily executed with La Suerte formal dealership agreements which indicate the distribution and sale of La Suerte cigarettes signifies that they were acting as independent businessmen. It is not disputed that under the dealership agreement, the dealer purchases and sells the cigarettes manufactured by the company under and for his own account. The dealer places his order for the purchase of cigarettes to be sold by him in a particular territory by filling up an Issuance Slip. The dealers do not devote their full time in selling company products. They are likewise engaged in other livelihood and businesses while selling cigarettes manufactured by the company. We agree with the petitioner. We hold further that the terms and conditions for the termination of the contract are the usual and common stipulations in independent contractorship agreements. In any event, the contention that the totality of the powers expressly reserved to the company establish company control over the manner and details of performance is merely speculative and conjectural. G.R. Nos. 64821-23 January 29, 1993 UNIVERSITY OF PANGASINAN FACULTY UNION

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C AS E S - M S U |4 vs.NATIONAL LABOR RELATIONS COMMISSION and UNIVERSITY OF PANGASINAN

and that, since there were "no complainants for the alleged nonpayment of extra loads for two days," the issue had become academic.

ISSUE: Locus standi of the union President as the holder of “Registration Certificate”

ISSUES: 1. W/N the filing of mandamus is proper in this case. NO.

FACTS: In the instant petition for mandamus and certiorari, petitioner union seeks to enjoin the respondent National Labor Relations Commission (NLRC) to resolve, or direct the Labor Arbiter to hear and decide, the merits of three of petitioner's unresolved complaints, and to annul and set aside the resolution of the NLRC affirming the decision of the Executive Labor Arbiter dismissing the petitioner's complaints for violation of certain labor standards laws but requiring respondent university to integrate the cost of living allowance into the basic pay of the covered employees and reminding it to pay its employees at intervals not exceeding sixteen (16) days. The uncontroverted facts show that on various dates, petitioner union filed the following 7 complaints (which was later on limited by the Labor Arbiter into 4) against the University before the Arbitration Branch of the NLRC in Dagupan City of ECOLAS and salary differentials in certain dates from Oct- June 1890, On the complaint regarding integration of COLA, the LA ruled that because at the time P.D. No. 1123 took effect on May 1, 1977, the University had not increased its tuition fees, there was of "nothing to integrate." 4 However, from June 16, 1979 when the University increased its tuition fees, it was obligated to cause the integration of the across-the-board increase of P60.00 in emergency allowance into the basic pay as mandated by P.D. Nos. 1123 and 1751. On the alleged nonpayment of extra loads handled by the employees on February 12 and 13, 1981 when classes were suspended, Tumang stated that Consuelo Abad, the petitioner's president, had no cause to complain because her salary was fully paid

While the labor arbiter is duty bound to resolve all complaints referred to him for arbitration and, therefore, he may be compelled by mandamus to decide them (although not in any particular way or in favor of anyone), 8 we find that the peculiar circumstances in this case do not merit the issuance of the writ of mandamus. The facts on the verified petition was not “stated with certainty” It should be added that under Art. 217(b) of the Labor Code, the NLRC has "exclusive appellate jurisdiction over all cases decided by the Labor Arbiters." Needless to say, the NLRC could not have acted on matters outside of the cases appealed to it. 2. W/N the cases filed by the union Pres Consuelo Abad should affect not only herself but all the other union members. W/N she has locus standi to file. YES. She holds a “Registration Certificate”. Petitioner's contention that the cases filed by Consuelo Abad as its president should affect, not only herself, but all the other union members similarly situated as she was, is well taken. The uncontroverted allegation of the petitioner is that it is the holder of Registration Certificate No. 9865-C, having been registered with the then Ministry of Labor and Employment on February 16, 1978. As such, petitioner possessed the legal personality to sue and be sued under its registered name. 16 Corollarily, its president, Consuelo Abad, correctly filed the complaints even if some of them involved rights and interest purely or exclusively appertaining to individual employees, it appearing that she signed the complaints "for and in behalf of the University of Pangasinan Faculty Union." 17

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

LAB OR R ELAT IONS C AS ES - MS U |5 “interest of the individual worker can be better protected on the whole by a strong union aware of its moral and legal obligations to represent the rank and file faithfully and secure for them the best wages and working terms and conditions.” The University's contention that petitioner had no legal personality to institute and prosecute money claims must, therefore, fail. To quote then Associate Justice Teehankee in Heirs of Teodelo M. Cruz v. CIR, 18 "[w]hat should be borne in mind is that the interest of the individual worker can be better protected on the whole by a strong union aware of its moral and legal obligations to represent the rank and file faithfully and secure for them the best wages and working terms and conditions. . . . Although this was stated within the context of collective bargaining, it applies equally well to cases, such as the present wherein the union, through its president, presented its individual members' grievances through proper proceedings. While the complaints might nothave disclosed the identities of the individual employees claiming monetary benefits, 19 such technical defect should not be taken against the claimants, especially because the University appears to have failed to demand a bill of particulars during the proceedings before the Labor Arbiter. G.R. No. 131235 November 16, 1999 UST FACULTY UNION (USTFU),etal vs. Dir. BENEDICTO ERNESTO R. BITONIO JR. of the Bureau of Labor Relations, MedArbiter TOMAS F. FALCONITIN of The National Capital Region, Department of Labor and Employment (DOLE), etal,respondents. -On conducting Election of Union Members outside its by-laws. - Union Election vs Certificate Election ISSUE: W/N there is interference in the exercise by USTFU members of their right to self-organization. SUMMARY: There is a right way to do the right thing at the right time for the right reasons, 1 and in

the present case, in the right forum by the right parties. While grievances against union leaders constitute legitimate complaints deserving appropriate redress, action thereon should be made in the proper forum at the proper time and after observance of proper procedures. Similarly, the election of union officers should be conducted in accordance with the provisions of the union's constitution and bylaws, as well as the Philippine Constitution and the Labor Code. Specifically, while all legitimate faculty members of the University of Santo Tomas (UST) belonging to a collective bargaining unit may take part in a duly convened certification election, only bona fide members of the UST Faculty Union (USTFU) may participate and vote in a legally called election for union officers. Mob hysteria, however well-intentioned, is not a substitute for the rule of law. FACTS: Private respondents Marino et.al, are duly elected officers of the UST Faculty Union (USTFU). The union has a subsisting five-year Collective Bargaining Agreement with its employer, the University of Santo Tomas (UST). The CBA was registered with the Industrial Relations Division, DOLE-NCR, on 20 February 1995. It is set to expire on 31 May 1998. On 21 September 1996, appellee Collantes, in her capacity as Secretary General of USTFU, posted a notice addressed to all USTFU members announcing a general assembly to be held on 05 October 1996. Among others, the general assembly was called to elect USTFU's next set of officers. Through the notice, the members were also informed of the constitution of a Committee on Elections (COMELEC) to oversee the elections. (Annex "B", petition) On 01 October 1996, some of herein appellants filed a separate petition with the Med-Arbiter, DOLE-NCR, directed against herein appellees and the members of the COMELEC. Petition alleged that the COMELEC was not constituted in accordance with USTFU's constitution and by-laws (CBL)

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

LAB OR R ELAT IONS C AS ES - MS U |6 and that no rules had been issued to govern the conduct of the 05 October 1996 election. The Assailed Ruling Agreeing with the med-arbiter that the USTFU officers' purported election held on October 4, 1994 was void for having been conducted in violation of the union's Constitution and Bylaws (CBL), Public Respondent Bitonio rejected petitioners' contention that it was a legitimate exercise of their right to selforganization. He ruled that the CBL, which constituted the covenant between the union and its members, could not be suspended during the October 4, 1996 general assembly of all faculty members, since that assembly had not been convened or authorized by the USTFU. ISSUE: 1. W/N there is interference in the exercise by USTFU members of their right to self-organization. YES! The participation of non-union members in the election aggravated its irregularity 2. Whether the Collective Bargaining Unit of all the faculty members in that General Faculty Assembly had the right in that General Faculty Assembly to suspend the provisions of the Constitution and By-Laws of the USTFU regarding the elections of officers of the union[.] 3. Whether the suspension of the provisions of the Constitution and ByLaws of the USTFU in that General Faculty Assembly is valid pursuant to the constitutional right of the Collective Bargaining Unit to engage in "peaceful concerted activities" for the purpose of ousting the corrupt regime of the private respondents[.]. RULING: Right to Self-Organization and Union Membership Self-organization is a fundamental right guaranteed by the Philippine Constitution

and the Labor Code. Employees have the right to form, join or assist labor organizations for the purpose of collective bargaining or for their mutual aid and protection. 12 Whether employed for a definite period or not, any employee shall be considered as such, beginning on his first day of service, for purposes of membership in a labor union. 13 Corollary to this right is the prerogative not to join, affiliate with or assist a labor union. 14 Therefore, to become a union member, an employee must, as a rule, not only signify the intent to become one, but also take some positive steps to realize that intent. The procedure for union membership is usually embodied in the union's constitution and bylaws. 15 An employee who becomes a union member acquires the rights and the concomitant obligations that go with this new status and becomes bound by the union's rules and regulations. When a man joins a labor union (or almost any other democratically controlled group), necessarily a portion of his individual freedom is surrendered for the benefit of all members. He accepts the will of the majority of the members in order that he may derive the advantages to be gained from the concerted action of all. On joining a labor union, the constitution and by-laws become a part of the member's contract of membership under which he agrees to become bound by the constitution and governing rules of the union so far as it is not inconsistent with controlling principles of law. The constitution and by-laws of an unincorporated trade union express the terms of a contract, which define the privileges and rights secured to, and duties assumed by, those who have become members. The agreement of a member on joining a union to abide by its laws and comply with the will of the lawfully constituted majority does not require a member to submit to the determination of the union any question involving his personal rights. 16 Petitioners' frustration over the performance of private respondents, as well as their fears of a "fraudulent" election to

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C AS E S - M S U |7 be held under the latter's supervision, could not justify the method they chose to impose their will on the union. Director Bitonio aptly elucidated: 17 The constitutional right to selforganization is better understood in the context of ILO Convention No. 87 (Freedom of Association and Protection of Right to Organize), to which the Philippines is signatory. Article 3 of the Convention provides that workers' organizations shall have the right to draw up their constitution and rules and to elect their representatives in full freedom, free from any interference from public authorities. The freedom conferred by the provision is expansive; the responsibility imposed on union members to respect the constitution and rules they themselves draw up equally so. Union affairs and elections cannot be decided in a non-union activity. Union Election vs.Certification Election (included just in case asked.)

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

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 PURPOSE: 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

all employees belonging to the appropriate bargaining unit can vote. 20 Therefore, a unionmember 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. Union affairs and elections cannot be decided in a nonunion activity. October 4, 1996 election cannot properly be called a union election, because the procedure laid down in the USTFU's CBL for the election of officers was not followed. It could not have been a certification election either, because representation was not the issue, and the proper procedure for such election was not followed. The participation of non-union members in the election aggravated its irregularity. USTFU's Constitution and By Laws Violated The importance of a union's constitution and bylaws cannot be overemphasized. They embody a covenant between a union and its members and constitute the fundamental law governing the members' rights and obligations. 21 As such, the union's constitution and bylaws should be upheld, as long as they are not contrary to law, good morals or public policy.

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

LAB OR R ELAT IONS C AS ES - MS U |8 BENJAMIN VICTORIANO vs ELIZALDE ROPE WORKERS UNION, GR No. 25246, September 12, 1974

enforce terms of contracts and at the same time it recognizes the workers’ right to join or not to join union. RA 3550 recognizes as well the primacy of a constitutional right over a contractual right.

FACTS: Benjamin Victoriano, an Iglesia ni Cristo (INC) member, has been an employee of the Elizalde Rope Factory (ERF) since 1958. He was also a member of the EPWU (Elizalde Rope Workers’ Union). Under the collective bargaining agreement (CBA) between ERF and EPWU, a close shop agreement is being enforced which means that employment in the factory relies on the membership in the EPWU; that in order to retain employment in the said factory one must be a member of the said Union. In 1962, Victoriano tendered his resignation from EPWU claiming that as per RA 3350 he is an exemption to the close shop agreement by virtue of his being a member of the INC because apparently in the INC, one is forbidden from being a member of any labor union. It was only in 1974 that his resignation from the Union was acted upon by EPWU which notified ERF about it. ERF then moved to terminate Victoriano due to his non-membership from the EPWU. EPWU and ERF reiterated that he is not exempt from the close shop agreement because RA 3350, which provides that close shop agreements shall not cover members of any religious sects which prohibit affiliation of their members in any such labor organization, is unconstitutional and that said law violates the EPWU’s and ERF’s legal/contractual rights. ISSUE: Whether or not RA 3350 is unconstitutional. HELD: No. Right to religion prevails over contractual or legal rights. As such, an INC member may refuse to join a labor union and despite the fact that there is a close shop agreement in the factory where he was employed, his employment could not be validly terminated for his non-membership in the majority therein. Further, the right to join a union includes the right not to join a union. The law is not unconstitutional. It recognizes both the rights of unions and employers to

BPI vs BPI Employees Union DavaoChapter, August 10, 2010E CASTRO, J.] FACTS: Bangko Sentral ng Pilipinas approved the Articles of Merger executed by and between BPI, herein petitioner, and Far East Bank and Trust Company (FEBTC) and was approved by the Securities and Exchange Commission. The Articles of Merger and Plan of Merger did not contain any specific stipulation with respect to the employment contracts of existing personnel of the non-surviving entity which is FEBTC. Pursuant to the said Article and Plan of Merger, all the assets and liabilities of FEBTC were transferred to and absorbed by BPI as the surviving corporation. FEBTC employees, including those in its different branches across the country, were hired by petitioner as its own employees, with their status and tenure recognized and salaries and benefits maintained. ISSUE Whether or not employees are ipso jure absorbed in a merger of the two corporations. RULING NO. [H]uman beings are never embraced in the term “assets and liabilities.”Moreover, BPI’s absorption of former FEBTC employees was neither by operation of law nor by legal consequence of contract. There was no government regulation or law that compelled the merger of the two banks or the absorption of the employees of the dissolved corporation by the surviving corporation. Had there been such law or regulation, the absorption of employees of the non-surviving entities of the merger would have been mandatory on the surviving corporation. In the present case, the merger was voluntarily entered into by both

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

LAB OR R ELAT IONS C AS ES - MS U |9 banks presumably for some mutually acceptable consideration. In fact, the Corporation Code does not also mandate the absorption of the employees of the nonsurviving corporation by the surviving corporation in the case of a merger. [The] Court cannot uphold the reasoning that the general stipulation regarding transfer of FEBTC assets and liabilities to BPI as set forth in the Articles of Merger necessarily includes the transfer of all FEBTC employees into the employ of BPI and neither BPI nor the FEBTC employees allegedly could do anything about it. Even if it is so, it does not follow that the absorbed employees should not be subject to the terms and conditions of employment obtaining in the surviving corporation. Furthermore, [the] Court believes that it is contrary to public policy to declare the former FEBTC employees as forming part of the assets or liabilities of FEBTC that were transferred and absorbed by BPI in the Articles of Merger. Assets and liabilities, in this instance, should be deemed to refer only to property rights and obligations of FEBTC and do not include the employment contracts of its personnel. A corporation cannot unilaterally transfer its employees to another employer like chattel. Certainly, if BPI as an employer had the right to choose who to retain among FEBTC’s employees, FEBTC employees had the concomitant right to choose not to be absorbed by BPI. Even though FEBTC employees had no choice or control over the merger of their employer with BPI, they had a choice whether or not they would allow themselves to be absorbed by BPI. Certainly nothing prevented the FEBTC’s employees from resigning or retiring and seeking employment elsewhere instead of going along with the proposed absorption. Employment is a personal consensual contract and absorption by BPI of a former FEBTC employee without the consent of the employee is in violation of an individual’s freedom to contract. It would have been a different matter if there was an express provision in the articles of

merger that as a condition for the merger, BPI was being required to assume all the employment contracts of all existing FEBTC employees with the conformity of the employees. In the absence of such a provision in the articles of merger, then BPI clearly had the business management decision as to whether or not employ FEBTC’s employees. FEBTC employees likewise retained the prerogative to allow themselves to be absorbed or not; otherwise, that would be tantamount to involuntary servitude. [Note: The decision as to absorption of employees upon merger is reversed in the Resolution of MR dated October 19, 2011]

BALBOA NATU VS TORRES, G.R. No. 93468 December 29, 1994 FACTS: NATU filed a petition for certification election to determine the exclusive bargaining representative of respondent Bank's employees occupying supervisory positions. Bank moved to dismiss the petition on the ground that the supposed supervisory employees were actually managerial and/or confidential employees thus ineligible to join, assist or form a union, and that the petition lacked the 20% signatory requirement under the Labor Code. ISSUE: WON the Department Managers, Assistant Managers, Branch Managers/OICs, Cashiers and Controllers of respondent Bank are managerial and/or confidential employees hence ineligible to join or assist the union of petitioner. RULING YES, but only the Branch Managers/OICs, Cashiers and Controllers of respondent Republic Planters Bank are ineligible to

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 10 join or assist petitioner National Association of Trade Unions (NATU)Republic Planters Bank Supervisors Chapter, or join, assist or form any other labor organization. Art 212 (m) of the Labor Code explicitly stated that “A managerial employee is (a) one who is vested with powers or prerogatives to lay down and execute management policies, or to hire, transfer, suspend, lay off, recall, discharge, assign or discipline employees; or (b) one who is vested with both powers or prerogatives. A supervisory employee is different from a managerial employee in the sense that the supervisory employee, in the interest of the employer, effectively recommends such managerial actions, if the exercise of such managerial authority is not routinary in nature but requires the use of independent judgment.” It is the nature of the employee's functions, and not the nomenclature or title given to his job, which determines whether he has rank-and-file, supervisory or managerial status. Among the general duties and responsibilities of a Branch Manager is "[t]o discharge his duties and authority with a high sense of responsibility and integrity and shall at all times be guided by prudence like a good father of the family, and sound judgment in accordance with and within the limitations of the policy/policies promulgated by the Board of Directors and implemented by the Management until suspended, superseded, revoked or modified". Similarly, the job summary of a Controller states: "Supervises the Accounting Unit of the branch; sees to the compliance by the Branch with established procedures, policies, rules and regulations of the Bank and external supervising authorities; sees to the strict implementation of control procedures. The job description of a Cashier does not mention any authority on his part to lay down policies, either.

Subject employees do not participate in policymaking but are given approved and established policies to execute and standard practices to observe, leaving little or no discretion at all whether to implement said policies or not. Neither do the Branch Managers, Cashiers and Controllers have the power to hire, transfer, suspend, lay off, recall, discharge, assign or discipline employees. The Senior Manager of the Human Resource Management Department of respondent Bank, in her affidavit, stated that “…Mr. Renato A. Tuates, the Officer-in-Charge/Branch Cashier of the Bank's Dumaguete Branch, placed under preventive suspension and thereafter terminated the teller of the same branch . . . . Likewise, on February 22, 1989, Mr. Francis D. Robite, Sr., the Officer-in-Charge of International Department, assigned the cable assistant of the International Department as the concurrent FCDU Accountable Forms Custodian." 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. RATIONALE of RULE: In the collective bargaining process, managerial employees are supposed to be on the side of the employer, to act as its representatives, and to see to it that its interests are well protected. The employer is not assured of such protection if these employees themselves are union members. Similarly, if confidential employees could unionize in order to bargain for advantages for themselves, then they could be governed by their own motives rather than the interest of the employers. Moreover, unionization of confidential employees for the purpose of collective bargaining would mean the extension of the law to persons or individuals who are supposed to act "in the interest of" the employers. It is not farfetched that in the course of collective bargaining, they might jeopardize that interest which they are dutybound to protect.

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 11 SAN MIGUEL VS LAGUESMA, G.R. No. 100485 September 21, 1994

duties of the parties under the collective bargaining provisions of the law." 5

FACTS

Fundamental factors in determining the appropriate collective bargaining unit: (1) the will of the employees (Globe Doctrine); (2) affinity and unity of the employees' interest, such as substantial similarity of work and duties, or similarity of compensation and working conditions (Substantial Mutual Interests Rule); (3) prior collective bargaining history; and (4) similarity of employment status.

The North Luzon Magnolia Sales Labor Union (respondent union for brevity) filed with the Department of Labor a petition for certification election among all the regular sales personnel of Magnolia Dairy Products in the North Luzon Sales Area. 1 Petitioner opposed the petition and questioned the appropriateness of the bargaining unit sought to be represented by respondent union. It claimed that its bargaining history in its sales offices, plants and warehouses is to have a separate bargaining unit for each sales office. Petitioner was represented by Atty. Alvin Batalla who withdrew petitioner's opposition to a certification election and agreed to consider all the sales offices in northern Luzon as one bargaining unit. Mediator-Arbiter Benalfre J. Galang certified respondent union as the sole and exclusive bargaining agent for all the regular sales personnel in all the sales offices of Magnolia Dairy Products in the North Luzon Sales Area. Petitioner appealed to the Secretary of Labor. It claimed that Atty. Batalla was only authorized to agree to the holding of certification elections subject to the following conditions: (1) there would only be one general election; (2) in this general election, the individual sales offices shall still comprise separate bargaining units. ISSUE: WON respondent union represents an appropriate bargaining unit RULING: YES. A bargaining unit is a "group of employees of a given employer, comprised of all or less than all of the entire body of employees, consistent with equity to the employer, indicate to be the best suited to serve the reciprocal rights and

Existence of a prior collective bargaining history is neither decisive nor conclusive in the determination of what constitutes an appropriate bargaining unit. 8 Test of grouping: mutuality or commonality of interests. The employees sought to be represented by the collective bargaining agent must have substantial mutual interests in terms of employment and working conditions as evinced by the type of work they perform. In this case, commonality of interest among the North Luzon Sales area cannot be gainsaid. There is similarity of employment status for only the regular sales personnel in the north Luzon area covered. They have the same duties and responsibilities and substantially similar compensation and working conditions. Furthermore, petitioner insists that each of the sales offices in northern Luzon should be considered as a separate bargaining unit for negotiations would be more expeditious. Petitioner obviously chooses to follow the path of least resistance. It is not, however, the convenience of the employer that constitutes the determinative factor in forming an appropriate bargaining unit. Equally, if not more important, is the interest of the employees. TUNAY NA PAGKAKAISA VS ASIA BREWERY, G.R. No. 162025, August 3, 2010

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 12 FACTS: Respondent entered into a Collective Bargainig Agreement with Bisig at LakasngmgaManggagawasa Asia-Independent (BLMA-INDEPENDENT). Subsequently, a dispute arose when ABIs management stopped deducting union dues from eighty-one (81) employees, believing that their membership in BLMA-INDEPENDENT violated the CBA. Eighteen (18) of these affected employees are QA Sampling Inspectors/Inspectresses and Machine Gauge Technician who formed part of the Quality Control Staff. Twenty (20) checkers are assigned at the Materials Department of the Administration Division, Full Goods Department of the Brewery Division and Packaging Division. The rest are secretaries/clerks directly under their respective division managers. As the parties failed to amicably settle the controversy, BLMA-INDEPENDENT lodged a complaint before the National Conciliation and Mediation Board (NCMB). In the meantime, a certification election was held on August 10, 2002 wherein petitioner Tunayna Pagkakaisang Manggagawasa Asia (TPMA) won. As the incumbent bargaining representative of ABIs rank-and-file employees, petitioner filed with the CA an omnibus motion for reconsideration of the decision and intervention. ISSUE

(1) WON the 81 employees are excluded from and are not eligible to for inclusion in the bargaining unit as defined in the CBA and that their membership is violative of the CBA;

(2) WON respondent committed unfair labor practice by violating the 81 employees right to self-organization RULING:

Jurisprudence has extended prohibition of joining unions 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. Having access to confidential information, confidential employees may also become the source of undue advantage. Said employees may act as a spy or spies of either party to a collective bargaining agreement. In the present case, the CBA expressly excluded Confidential and Executive Secretaries from the rank-and-file bargaining unit, for which reason ABI seeks their disaffiliation from petitioner.However, perusal of the job descriptions of these secretaries/clerks reveals that their assigned duties and responsibilities involve routine activities of recording and monitoring, and other paper works for their respective departments while secretarial tasks such as receiving telephone calls and filing of office correspondence appear to have been commonly imposed as additional duties.Respondent failed to indicate who among these numerous secretaries/clerks have access to confidential data relating to management policies that could give rise to potential conflict of interest with their Union membership. With respect to the Sampling Inspectors/Inspectresses and the Gauge Machine Technician, there seems no dispute that they form part of the Quality Control Staff. But the same does not go with the 20 checkers. Again, the job descriptions of these checkersshowed that they perform routine and mechanical tasks preparatory to the delivery of the finished products. No evidence was presented by the respondent to prove that these daily-paid checkers actually form part of the company’s Quality Control Staff who as such were exposed to sensitive, vital and

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 13 confidential information about the products or have knowledge of mixtures of the products, their defects, and even their formulas which are considered trade secrets.

PEPSI VS SECRETARY OF LABOR, G.R. No. 96663, August 10, 1999

Confidential employees are defined as those who

Pepsi-Cola Employees Organization-UOEF (PCEU) filed a petition for certification election with the Med-Arbiter seeking to be the exclusive bargaining agent of supervisors of Pepsi-Cola Philippines (Pepsi). The petition was granted, but with the explicit statement that PCEU was affiliated with Union de Obreros Estivadores de Filipinas (UOEF) and 2 other rank-and-file unions, the PCLU and the PEUP.

(1) assist or act in a confidential capacity, (2) to persons who formulate, determine, and effectuate management policies in the field of labor relations. The two (2) criteria are cumulative, and both must be met if an employee is to be considered a confidential employee. There is no showing in this case that the secretaries/clerks and checkers assisted or acted in a confidential capacity to managerial employees and obtained confidential information relating to labor relations policies.

FACTS

Pepsi then filed a petition for cancellation with the BLR against PCEU, on the grounds that: (a) the members of PCEU were managers and (b) a supervisors' union cannot affiliate with a federation whose members include the rank and file union of the same company. It also filed an urgent ex-parte motion to suspend the certification election.

Anent the second issue, unfair labor practice refers to acts that violate the workers right to organize. The prohibited acts are related to the workers right to self organization and to the observance of a CBA. For a charge of unfair labor practice to prosper, it must be shown that ABI was motivated by ill will, bad faith, or fraud, or was oppressive to labor, or done in a manner contrary to morals, good customs, or public policy.

PCEU argued that Art. 245 of the Labor Code, as amended by RA 6715, did not prohibit a local union composed of supervisory employees from being affiliated to a federation which has local unions with rank-and-file members as affiliates. Furthermore, Book V, Rule II, Section 7 of the Omnibus Rules Implementing the Labor Code provides the grounds for cancellation of the registration certificate of a labor organization, and the inclusion of managerial employees is not one of the grounds.

Considering that the herein dispute arose

However, on 1992, or before the SC decision, the PCEU issued a resolution withdrawing from the UOEF.

from a simple disagreement in the interpretation of the CBA provision on excluded employees from the bargaining unit, respondent cannot be said to have committed unfair labor practice that restrained its employees in the exercise of their right to selforganization, nor have thereby demonstrated an anti-union stance.

ISSUE WON a supervisors union can affiliate with the same Federation of which two (2) rank and file unions are likewise members, without violating Article 245 of the Labor Code (PD 442), as amended, by Republic Act 6715. RULING

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 14 The case is already moot and academic because PCEU has already withdrawn from the case. But for the guidance of others similarly situated, the Court ruled No.

FACTS

If the intent of the law is to avoid a situation where supervisors would merge with the rankand-file or where the supervisor’s 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. The Court emphasizes that the limitation is not confined to a case of supervisors wanting to join a rank-and-file union. The prohibition extends to a supervisors local union applying for membership in a national federation the members of which include local unions of rank and file employees. The intent of the law is clear especially where, as in this case, the supervisors will be co-mingling with those employees whom they directly supervise in their own bargaining unit. The Court finds merit in the submission of the OSG that Route Managers, Chief Checkers and Warehouse Operations Managers are supervisors while Credit & Collection Managers and Accounting Managers are highly confidential employees. Designation should be reconciled with the actual job description of subject employees. A careful scrutiny of their job description indicates that they don’t lay down company policies. Theirs is not a final determination of the company policies since they have to report to their respective superior. The mere fact that an employee is designated manager does not necessarily make him one.

Petitioner Philips Industrial Development, Inc. (PIDI) seeks to set aside the Decision and Resolution of the NLRC on the ground that it committed grave abuse of discretion amounting to lack of jurisdiction in holding that service engineers, sales representatives and confidential employees of PIDI are qualified to be included in the existing bargaining unit. PIDI had a total of six (6) collective bargaining agreements (CBAs) with private respondent Philips Employees Organization-FFW (PEOFFW), a registered labor union and the certified bargaining agent of all the rank and file employees of PIDI. In the sixth CBA covering the years 1987 to 1989, it was agreed upon, among others, that the subject of inclusion or exclusion of service engineers, sales personnel and confidential employees in the coverage of the bargaining unit would be submitted for arbitration. As the parties failed to agree on a voluntary arbitrator, the BLR endorsed the petition to the Executive Labor Arbiter of the National Capital Region for compulsory arbitration pursuant to Article 228 of the Labor Code. It ordered the respondent to conduct a referendum to determine the will of the service engineers, sales representatives as to their inclusion or exclusion in the bargaining unit. Furthermore, it declared that the Division Secretaries and all Staff of general management, personnel and industrial relations department, secretaries of audit, EDP, financial system are confidential employees and as such are hereby deemed excluded in the bargaining unit. PEOFFW appealed from the decision to the NLRC in which the NLRC set aside the Executive Labor Arbiter’s decision.

What is essential is the nature of the employees 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.

ISSUE

PHILIPS VS NLRC, G.R. No. 88957 June 25, 1992

RULING

WON service engineers, sales engineers and confidential employees are qualified to be part of the existing bargaining unit of the rankand-file employees of PIDI.

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 15 In holding that they are included in the bargaining unit for the rank and file employees of PIDI, the NLRC practically forced them to become members of PEO-FFW or to be subject to its sphere of influence, it being the certified bargaining agent for the subject bargaining unit. This violates, obstructs, impairs and impedes the service engineers' and the sales representatives' constitutional right to form unions or associations and to self-organization. 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 (sic) the bargaining unit" is the most appropriate procedure that conforms with their right to form, assist or join in labor union or organization. However, since this decision was rendered before the effectivity of R.A. No. 6715, it must now be stressed that its future application to the private parties in this case should, insofar as service engineers and sales representatives holding supervisory positions or functions are concerned, take into account the present Article 245 20 of the Labor Code which, as amended by R.A. No. 6715, now reads: 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 a labor organization of the rankand-file employees but may join, assist or form separate labor organizations of their own. GARCIA

Golden Farms Inc. vs. Calleja FACTS: Petitioner is a corporation and its employees represented by the private respondent union (National Federation Labor) filed a petition for Certification Election before the office of the

Ministry of Labor and Employment. The petition declared that the employees belonged to rank-and-file. The petition was opposed by the petitioner on the grounds that some of the employees supporting the said petition are performing managerial functions or confidential positions. The petition was dismissed by a resolution establishing that a collective bargaining unit between the petitioner and private respondent was inexistence at the time of the filing and the present filing of the petition. Herein public respondent released a decision in favor of the private respondent union stating that the employees are classified as rank and file employees. Hence this petition seeks the reversal of the resolution made by public respondent. ISSUE: WON supervisors, cashiers, foremen, and employees holding confidential/managerial function are allowed to enter into a collective bargaining agreement with the petitioner corporation. RULING: NO. The SC stated in a case, if these managerial employees would belong to or be affiliated with a Union, the latter might not be assured of their loyalty to the Union in view of evident conflict of interests or that the Union can be company- dominated with the presence of managerial employees in Union membership. A managerial employee is defined under Art. 212 (k) of the new Labor Code as "one who is vested with powers or prerogatives to lay down and execute management policies and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline employees, or to effectively recommend such managerial actions. All employees not falling within this definitions are considered rank-and-file employees for purposes of this Book." This rationale also serves confidential employees. To allow the

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 16 confidential employees to join the existing Union of the rank-and-file would be in violation of the terms of the Collective Bargaining Agreement wherein this kind of employees by the nature of their functions/positions are expressly excluded. Hence, to the company foremen while in the performance of their supervisory functions, they may be the extension of the management, and shall be prohibited to join. Petition dismissed. National Association of Trade Unions vs.Hon. Torres

employees, there is no legalprohibition against confidential employees who are notperforming managerial functions to form and join a union.A confidential employee is one entrusted with confidenceon delicate matters, or with the custody, handling, or careand protection of the employer's property. While Art. 245of the Labor Code singles out managerial employees asineligible to join, assist or form any labor organization,under thedoctrine of necessary implication,confidential employees are similarly disqualified Pier 8 Arrastre v. Roldan-Confessor

FACTS: Petitioner NATU filed a petition for certification election to determine the “exclusive bargaining representative” of respondent’s bank employees occupying supervisory positions. The Bank moved to dismiss on the ground thatsaid supervisory employees were actuallymanagerial/confidential employees, thus, they are ineligible to join, assist or form a union. The Med-Arbiter granted the petition and directed the holding of the certification election. The Bank appealed to the Secretary of Labor. Said court partially granted the appeal ruling thatthe Department Managers, Assistant Managers, Branch Managers, Cashiers and Controllers are declared managerial employees and cannot join the union of the supervisors. ISSUE: Whether or not Department Managers, Assistant Managers, Branch Managers/OICs, Cashiers and Controllers of respondent Bank are managerial or confidential employees are ineligible to join the union. RULING: Petitioner concludes that subject employees are not managerial employees but supervisors. Even assumingthat they are confidential

FACTS: The corporation and private respondent union enetered into a collective bargaining agreement. During the freedom period, NAFLU questioned the majority status of the union by filing for a petition for certification election (CE). The private respondent union won the CE and was certified as the sole and exclusive bargaining agent of the rank and file employees. However, the negotiations for the CBA collapsed. The Sec. of Labor took over the dispute and resolved the bargaining deadlock and ordered that the position of foremen, secretaries, and timekeepers were lumped together as part of the rank-and-file. The petitioner contended that supervisors (foremen) and the legal secretary should be excluded from the bargaining unit. ISSUE: WON the foremen and secretaries should be excluded from the rank and file bargaining unit RULING: Yes. Art. 245 of the Labor Code applies. The foremen and are supervisory employees and therefore cannot be part of the rank and file. Legal secretaries are neither managers or supervisors but confidential workers hence, they cannot be part of the ran and file as well. With respect to the timekeepers, they should

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 17 not be excluded from the bargaining unit of the rank and file. The test of supervisory or managerial status is whether an employee possesses authority to act in the interest of his employer, and such authority is not merely routinary or clerical in nature but requires the use of independent judgment. What determines the nature of the employment is not the title bu the job description. Metrolab Industries Inc. vs. Roldan Confesor

WON executive secretaries must be included as part of the bargaining unit of rank and file employees. RULING: NO. By recognizing the expanded scope of the right to self-organization, the intent of the court was to delimit the types of employees excluded from the close shop provisions, not from the bargaining unit.

FACTS: Herein petitioner Metrolab Industries represented by the private respondent Metro Drug Corp. a labor organization representing the petitioners’ employees. After the CBA between the parties expired, negotiations for new CBA ended into deadlock. Both parties failed to settle their dispute hence the order issued by the Secretary of Labor and Employment that any strike or acts that might exacerbate the situation is ceased and ordered the parties to execute a new CBA. Later, the petitioner moved two lay-off acts to its rank and file employees and was opposed by the union. Petitioner assailed that the move was temporary and exercise of its management prerogative. Herein public respondent declared that the petitioner’s act illegal and issued two resolution of cease and desist stating that the move exacerbate and caused conflict to the case at bar. Included on the last resolution issued by the public respondent which states that executive secretaries are excluded from the closed-shop provision of the CBA, not from the bargaining unit. A petition for certiorari seeking the annulment of the Resolution and Omnibus Resolution of Roldan-Confesor on grounds that they were issued with grave abuse of discretion and excess of jurisdiction. ISSUE:

The executive secretaries of General Manager and the Management Committees should not only be exempted from the closed-shop provision but should not be permitted to join in the bargaining unit of the rank and file employees as well as on the grounds that the executive secretaries are confidential employees , having access to “vital labor information”. As stated in several cases, confidential employees are prohibited and disqualified to join any bargaining unit since the very nature of the functions are to assist and act in a confidential capacity, or to have access to confidential matters of, persons who exercise managerial functions in the field of labor relations. Finally, confidential employees cannot be classified as rank and file from the very nature of their work. Excluding confidential employees from the rank and file of bargaining unit, therefore, is not tantamount to discrimination. Therefore, executive secretaries of petitioners’ General Manager and its Management Committee are permanently excluded from the bargaining unit of petitioner’s rank and file employees. Arizala vs. CA FACTS:

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 18 Under the Industrial Peace Act, governmentowned or controlled corporations has the duty to bargain collectively and were otherwise subject to the obligations and duties of employers in the private sector. The Act also prohibited supervisors to become or continue to be members of labor organizations composed of rank and file employees. Under the regime of the said act that GSIS became bound by a CBA executed between it and the the labor organization representing the majority of its employees, the GSIS Employees Association. The petitioner occupied supervisory positions in the GSIS and demand were made on all the petitioners to resign to the labor organizations since they handle supervisory positions. The petitioners declined to do so hence criminal cases for violation of the Industrial Act were filed against them resulting to their conviction. Petitioners argued that when the so called “1973 Constitution” took effect their cases were still pending on two different courts. Since the provision of that constitution and of the Labor Code subsequently promulgated, repealing the Industrial Act- placed employees of all categories in government-owned or controlled corporations employment were to be governed by the Civil Service Law and hence, no longer subject of collective bargaining. The appellants ceased to fall within the coverage of the Industrial Peace Art and should thus no longer be prosecuted. They pointed that criminal sanction in the said act is no longer found in the Labor Code.

ISSUE: WON the petitioners’ criminal liability of the Industrial Peace Act may be deemed obliterated in virtue of subsequent legislation and provision of the 1973 and 1987 Constitutions.

RULING: YES. The right to self-organization and collective bargaining had been withdrawn by the Labor Code from government employees including those government-owned or controlled corporations chiefly for the reason that the terms and conditions of government employment, all embraced in the civil service, may not be modified by collective bargaining because set by law. It is therefore immaterial, they say, whether supervisors are members of rank-and-file union or not. After all, the possibility of the employer’s control of the members of the union thru supervisors thus rendering collective bargaining illusory, which is the main reason for the prohibition, is no longer of any consequence.

AMISTAD

16. Camporedondo v. NLRC, Aug 6, 1999. 17. Cooperative rural bank v Calleja Sept 26, 1988; 18. Republic v. Asiapro coop. Nov 23, 2007; 19. Int’l Catholic v. Calleja 190 scra 130; 20. German agency v. CA April 16, 2009;

CEDENIO HERITAGE HOTEL VS NATIONAL UNION FACTS: Respondent’s petition for certification election was granted and ordered the holding of a certification election. On appeal, the DOLE Secretary affirmed the order and remanded the holding of a pre-election conference. Subsequently, petitioner discovered that respondent had failed to submit to the Bureau of Labor Relations (BLR) its annual financial report for several years and the list of its members since it filed its registration papers in 1995. Consequently, petitioner filed a

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 19 Petition for Cancellation of Registration of respondent, on the ground of the nonsubmission of the said documents. Petitioner prayed that respondent’s Certificate of Creation of Local/Chapter be cancelled and its name be deleted from the list of legitimate labor organizations. It further requested the suspension of the certification election proceedings. Petitioner also insists that respondent’s registration as a legitimate labor union should be cancelled. Petitioner posits that once it is determined that a ground enumerated in Article 239 of the Labor Code is present, cancellation of registration should follow; it becomes the ministerial duty of the Regional Director to cancel the registration of the labor organization. Petitioner points out that the Regional Director has admitted in its decision that respondent failed to submit the required documents for a number of years; therefore, cancellation of its registration should have followed as a matter of course. The appellee/respondent however submitted its financial statement for the years 1996-1999. The latter argued that the submission had substantially complied with its duty to submit its financial report for the said period. ISSUE: W/N the noncompliance with the requirements under Article 239 of the Code is a sufficient ground for the cancellation of the union’s registration. HELD: NO. It is undisputed that appellee failed to submit its annual financial reports and list of individual members in accordance with Article 239 of the Labor Code. However, the existence of this ground should not necessarily lead to the cancellation of union registration. Article 239 recognizes the regulatory authority of the State to exact compliance with reporting requirements. Yet there is more at stake in this case than merely monitoring union activities and requiring periodic documentation thereof. The more substantive considerations involve the constitutionally guaranteed freedom of association and right of workers to selforganization. Also involved is the public policy to promote free trade unionism and collective bargaining as instruments of industrial peace

and democracy. An overly stringent interpretation of the statute governing cancellation of union registration without regard to surrounding circumstances cannot be allowed. Otherwise, it would lead to an unconstitutional application of the statute and emasculation of public policy objectives. Worse, it can render nugatory the protection to labor and social justice clauses that pervades the Constitution and the Labor Code. Moreover, submission of the required documents is the duty of the officers of the union. It would be unreasonable for this Office to order the cancellation of the union and penalize the entire union membership on the basis of the negligence of its officers. In National Union of Bank Employees vs. Minister of Labor, L-53406, 14 December 1981, 110 SCRA 296, the Supreme Court ruled: As aptly ruled by respondent Bureau of Labor Relations Director Noriel: "The rights of workers to self-organization finds general and specific constitutional guarantees. x x x Such constitutional guarantees should not be lightly taken much less nullified. A healthy respect for the freedom of association demands that acts imputable to officers or members be not easily visited with capital punishments against the association itself." At any rate, we note that appellee had submitted its financial statement. With this, respondent has substantially complied with its duty to submit its financial report for the said period. To rule differently would be to preclude the union, after having failed to meet its periodic obligations promptly, from taking appropriate measures to correct its omissions. For the record, we do not view with favor appellee’s late submission. Punctuality on the part of the union and its officers could have prevented this petition. S.S. VENTURES INTERNATIONAL, INC. VS. S.S. VENTURES LABOR UNION (SSVLU) FACTS: Petitioner S.S. Ventures International, Inc. (Ventures), a PEZA- registered export firm with

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 20 principal place of business at Phase I-PEZABataan Export Zone, Mariveles, Bataan, is in the business of manufacturing sports shoes. Respondent S.S. Ventures Labor Union (Union) is a labor organization registered with the DOLE. March 21, 2000, the Union filed with DOLERegion III a petition for certification election in behalf of the rank-and-file employees August 21, 2000, Ventures filed a Petition to cancel the Union’s certificate of registration alleging that the Union deliberately and maliciously included the names of more or less 82 former employees no longer connected with Ventures in its list of members who attended the organizational meeting and in the adoption/ratification of its constitution and by-laws; that No organizational meeting and ratification actually took place; and the Union’s application for registration was not supported by at least 20% of the rank-and-file employees of Ventures. Regional Director of DOLE- Region III favored Ventures and resolved to Cancel the Certificate of the union. On appeal, the BLR Director granted the Union’s appeal and reversing the decision of RD. Ventures went to the CA. The CA dismissed Ventures’ petition as well as the MR. Hence, this petition for review. ISSUE: W/N the registration of the Union must be cancelled. RULING: NO. The right to form, join, or assist a union is specifically protected by Art. XIII, Section 3 of the Constitution and such right, according to Art. III, Sec. 8 of the Constitution and Art. 246 of the Labor Code, shall not be abridged. Once registered with the DOLE, a union is considered a legitimate labor organization endowed with the right and privileges granted by law to such organization. While a certificate of registration confers a union with legitimacy with the concomitant right to participate in or ask for certification election in a bargaining unit, the registration may be canceled or the union may be decertified as the bargaining unit, in which case the union is divested of the status of a legitimate labor organization. Among the

grounds for cancellation is the commission of any of the acts enumerated in Art. 239(a) of the Labor Code, such as fraud and misrepresentation in connection with the adoption or ratification of the union’s constitution and like documents. The Court, has in previous cases, said that to decertify a union, it is not enough to show that the union includes ineligible employees in its membership. It must also be shown that there was misrepresentation, false statement, or fraud in connection with the application for registration and the supporting documents, such as the adoption or ratification of the constitution and by-laws or amendments thereto and the minutes of ratification of the constitution or by-laws, among other documents. The evidence presented by Ventures consist mostly of separate hand-written statements of 82 employees who alleged that they were unwilling or harassed signatories to the attendance sheet of the organizational meeting. However these evidence was presented seven months after the union filed its petition for cancellation of registration. Hence these statements partake of the nature of withdrawal of union membership executed after the Union’s filing of a petition for certification election on March 21, 2000. We have said that the employees’ withdrawal from a labor union made before the filing of the petition for certification election is presumed voluntary, while withdrawal after the filing of such petition is considered to be involuntary and does not affect the same. Now then, if a withdrawal from union membership done after a petition for certification election has been filed does not vitiate such petition, it is but logical to assume that such withdrawal cannot work to nullify the registration of the union. The Court is inclined to agree with the CA that the BLR did not abuse its discretion nor gravely err when it concluded that the affidavits of retraction of the 82 members had no evidentiary weight. The registration or the recognition of a labor union after it has submitted the corresponding papers is not ministerial on the part of the BLR. It becomes mandatory for the BLR to check if the requirements under Art. 234 of the Labor Code have been sedulously

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 21 complied with. If the union’s application is infected by falsification and like serious irregularities, especially those appearing on the face of the application and its attachments, a union should be denied recognition as a legitimate labor organization. The issuance to the Union of Certificate of Registration, in the case at bar, necessarily implies that its application for registration and the supporting documents thereof are prima facie free from any vitiating irregularities. The relevance of the 82 individuals’ active participation in the Union’s organizational meeting and the signing ceremonies thereafter comes in only for purposes of determining whether or not the Union, even without the 82, would still meet what Art. 234(c) of the Labor Code requires to be submitted, requiring that the union applicant must file the names of all its members comprising at least twenty percent (20%) of all the employees in the bargaining unit where it seeks to operate. In its union records on file with this Bureau, respondent union submitted the names of 542 members. This number easily complied with the 20% requirement, be it 1,928 or 2,202 employees in the establishment. Even subtracting the 82 employees from 542 leaves 460 union members, still within 440 or 20% of the maximum total of 2,202 rank-and-file employees of the employer Venture. Whatever misgivings the petitioner may have with regard to the 82 dismissed employees is better addressed in the inclusion-exclusion proceedings during a pre-election conference. The issue surrounding the involvement of the 82 employees is a matter of membership or voter eligibility. It is not a ground to cancel union registration. For fraud and misrepresentation to be grounds for cancellation of union registration under Article 239, the nature of the fraud and misrepresentation must be grave and compelling enough to vitiate the consent of a majority of union members Toyota vs Toyota Union FACTS:

Toyota Motor Philippines Corporation Labor Union (TMPCLU) filed a petition for certification election with the Department of Labor, National Capital Region, for all rankand-file employees of the Toyota Motor Corporation. The Med-Arbiter dismissed respondent union's petition for certification election for lack of merit. The latter found that the labor organization's membership was composed of supervisory and rank-and-file employees in violation of Article 245 of the Labor Code. On appeal, the Office of the Secretary of Labor, set aside the Med-Arbiter's Order and directed the holding of a certification election among the regular rank-and-file employees of Toyota Motor Corporation contending that the Med-Arbiter should have not dismissed the petition for certification election based on the ground that the proposed bargaining unit is a mixture of supervisory and rank-and-file employees. The petition and the other documents submitted by respondent will readily show that what the former really seeks to represent are the regular rank-and-file employees in the company numbering about 1,800 more or less, a unit which is obviously appropriate for bargaining purposes. This being the case, CA believed that the mere allegation of respondent-appellee that there are about 42 supervisory employees in the proposed bargaining unit should have not caused the dismissal of the instant petition. Petitioner filed this special civil action contends that "the Secretary of Labor and Employment committed grave abuse of discretion amounting to lack or excess of jurisdiction in reversing, contrary to law and facts the findings of the Med-Arbiters to the effect that, the inclusion of the prohibited mix of rank-and file and supervisory employees in the roster of members” ISSUE: W/N the respondent’s inclusion of supervisory Employees in the union violates the Labor Code requirements. HELD: Inclusion of supervisory employees violates The Code. Art. 245 - Ineligibility of managerial employees to join any labor organization; right of supervisory employees. - Managerial Employees are not eligible to

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 22 join, assist or form any labor organization. Supervisory employees shall not be eligible for membership in a labor organization of the rank-and-file employees but may join, assist or form separate labor organizations of their own. Clearly, based on this provision, a labor organization composed of both rank-and-file and supervisory employees is no labor organization at all. It cannot, for any guise or purpose, be a legitimate labor organization. Not being one, an organization which carries a mixture of rank-and-file and supervisory employees cannot possess any of the rights of a legitimate labor organization, including the right to file a petition for certification election for the purpose of collective bargaining. It becomes necessary, therefore, anterior to the granting of an order allowing a certification election, to inquire into the composition of any labor organization whenever the status of the labor organization is challenged on the basis of Article 245 of the Labor Code. TAGAYTAY HIGHLANDS INTERNATIONAL GOLF CLUB INC VS TAGAYTAY HIGHLANDS EMPLOYEES UNION-PGTWO FACTS: October 16, 1997 Tagaytay Highlands Employees Union(THEU), Philippine Transport and General Workers Organization (PTGWO), Local Chapter No. 776, a legitimate labor organization said to represent majority of the rank-and-file employees of THIGCI, filed a petition for certification election before the DOLE Mediation-Arbitration Unit, Regional Branch No. IV. November 27, 1997, petitioner filed a petition opposing the filing of certification election because the list of union members submitted by it was defective and fatally flawed as it included the names and signatures of supervisors, resigned, terminated and absent without leave (AWOL) employees, as well as employees of The Country Club, Inc., a corporation distinct and separate from THIGCI; and that out of the 192 signatories to the petition, only 71 were actual rank-and-file employees of THIGCI. Also, some of the signatures in the list of union members were

secured through fraudulent and deceitful means, and submitted copies of the handwritten denial and withdrawal of some of its employees from participating in the petition. The union asserted that it complied with all the requirements for valid affiliation and inclusion in the roster of legitimate labor organizations pursuant to DOLE Department Order No. 9, series of 1997, on account of which it was duly granted a Certification of Affiliation by DOLE on October 10, 1997; and that Section 5, Rule V of said Department Order provides that the legitimacy of its registration cannot be subject to collateral attack, and for as long as there is no final order of cancellation, it continues to enjoy the rights accorded to a legitimate organization. Therefore, the Med-Arbiter should, pursuant to Article 257 of the Labor Code and Section 11, Rule XI of DOLE Department Order No. 09, automatically order the conduct of a certification election. On January 28, 1998, DOLE Med-Arbiter ordered the holding of a certification election. Further, DOLE set aside the Resolution dismissing the petition for certification election. MFR denied. CA denied THIGCI’s Petition for Certiorari and affirmed the DOLE Resolution of dismissal. It held that while a petition for certification election is an exception to the innocent bystander rule, hence, the employer may pray for the dismissal of such petition on the basis of lack of mutuality of interests of the members of the union as well as lack of employer-employee relationship and petitioner failed to adduce substantial evidence to support its allegations. ISSUE: W/N the withdrawal of some union members from the certification election will affect the result HELD: NO. As for petitioner’ s allegation that some of the signatures in the petition for certification election were obtained through fraud, false statement and misrepresentation, the proper procedure is, as reflected above, for it to file a petition for cancellation of the certificate of registration, and not to intervene

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 23 in a petition for certification election. Regarding the alleged withdrawal of union members from participating in the certification election, this Court’s following ruling is instructive: “T]he best forum for determining whether there were indeed retractions from some of the laborers is in the certification election itself wherein the workers can freely express their choice in a secret ballot. Suffice it to say that the will of the rank-and-file employees should in every possible instance be determined by secret ballot rather than by administrative or quasi-judicial inquiry. Such representation and certification election cases are not to be taken as contentious litigations for suits but as mere investigations of a non-adversary, fact-finding character as to which of the competing unions represents the genuine choice of the workers to be their sole and exclusive collective bargaining representative with their employer.” MARIWASA VS SEC. OF LABOR FACTS: Petitioner filed a Petition for Cancellation of Union Registration against respondent, claiming that the latter violated Article 2345 of the Labor Code and that it committed massive fraud and misrepresentation in violation of Article 2396 of the same code. That respondent failed to comply with the 20% union membership requirement for its registration as a legitimate labor organization because of the disaffiliation from the total number of union members of 102 employees who executed affidavits recanting their union membership. Regional Director of DOLE IV-A issued an Order granting the petition, revoking the registration of respondent, and delisting it from the roster of active labor unions. Respondent appealed to the Bureau of Labor Relations (BLR) and the latter granted the respondent’s appeal based on insufficiency of evidence. Petitioner filed a Motion for Reconsideration but the BLR denied it. Petitioner sought recourse from affirmation of the Court of Appeals (CA) of the BLR decision

through a Petition for Certiorari contending that; the CA seriously erred in ruling that the affidavits of recantation cannot be given credence, seriously erred in ruling that private respondent union complied with the 20% membership requirement and erred when it ruled that private respondent union did not commit misrepresentation, fraud or false statement. However, the CA denied it. ISSUE: W/N the respondent violated the percentage requirement of union members under Article 2345 of the Labor Code and committed massive fraud and misrepresentation. HELD: Evidently, these affidavits were written and prepared in advance, and the pro forma affidavits were ready to be filled out with the employees’ names and signatures. The first common allegation in the affidavits is a declaration that, in spite of his hesitation, the affiant was forced and deceived into joining the respondent union. The affidavit does not mention the identity of the people who allegedly forced and deceived the affiant into joining the union, circumstances constituted such force and deceit. Indeed, not only was this allegation couched in very general terms and sweeping in nature, but more importantly, it was not supported by any evidence whatsoever. Second allegation ostensibly bares the affiant’s regret for joining respondent union and expresses the desire to abandon or renege from whatever agreement he may have signed regarding his membership with respondent. Simply put, through these affidavits, it is made to appear that the affiants recanted their support of respondent’s application for registration. In the case of La Suerte Cigar and Cigarette Factory v. Director of the Bureau of Labor Relations, “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

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 24 withdrawals made after the filing of the petition are deemed involuntary”. The reason for such distinction is that if the withdrawal or retraction is made before the filing of the petition, the names of employees supporting the petition are supposed to be held secret to the opposite party. Logically, any such withdrawal or retraction shows voluntariness in the absence of proof to the contrary. Moreover, it becomes apparent that such employees had not given consent to the filing of the petition, hence the subscription requirement has not been met. When the withdrawal or retraction is made after the petition is filed, the employees who are supporting the petition become known to the opposite party since their names are attached to the petition at the time of filing. Therefore, it would not be unexpected that the opposite party would use foul means for the subject employees to withdraw their support. In the instant case, the affidavits of recantation were executed after the identities of the union members became public, i.e., after the union filed a petition for certification election on May 23, 2005, since the names of the members were attached to the petition. The purported withdrawal of support for the registration of the union was made after the documents were submitted to the DOLE, Region IV-A. The logical conclusion, therefore, following jurisprudence, is that the employees were not totally free from the employer’s pressure, and so the voluntariness of the employees’ execution of the affidavits becomes suspect. It is likewise notable that the first batch of 25 pro forma affidavits shows that the affidavits were executed by the individual affiants on different dates from May 26, 2005 until June 3, 2005, but they were all sworn before a notary public on June 8, 2005. There was also a second set of standardized affidavits executed on different dates from May 26, 2005 until July 6, 2005. While these 77 affidavits were notarized on different dates, 56 of these were notarized on June 8, 2005, the very same date when the first set of 25 was notarized.

Considering that the first set of 25 affidavits was submitted to the DOLE on June 14, 2005, it is surprising why petitioner was able to submit the second set of affidavits only on July 12, 2005. Accordingly, we cannot give full credence to these affidavits, which were executed under suspicious circumstances, and which contain allegations unsupported by evidence. At best, these affidavits are self-serving. They possess no probative value. Nevertheless, even assuming the veracity of the affidavits of recantation, the legitimacy of respondent as a labor organization must be affirmed. While it is true that the withdrawal of support may be considered as a resignation from the union, the fact remains that at the time of the union’s application for registration, the affiants were members of respondent and they comprised more than the required 20% membership for purposes of registration as a labor union. Article 234 of the Labor Code merely requires a 20% minimum membership during the application for union registration. It does not mandate that a union must maintain the 20% minimum membership requirement all throughout its existence. For the purpose of de-certifying a union such as respondent, it must be shown that there was misrepresentation, false statement or fraud in connection with the adoption or ratification of the constitution and by-laws or amendments thereto; the minutes of ratification; or, in connection with the election of officers, the minutes of the election of officers, the list of voters, or failure to submit these documents together with the list of the newly elected-appointed officers and their postal addresses to the BLR. The bare fact that two signatures appeared twice on the list of those who participated in the organizational meeting would not, to our mind, provide a valid reason to cancel respondent’s certificate of registration. The cancellation of a union’s registration doubtless has an impairing dimension on the right of labor to self-organization. For fraud and misrepresentation to be grounds for cancellation of union registration under the Labor Code, the nature of the fraud and

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 25 misrepresentation must be grave and compelling enough to vitiate the consent of a majority of union members. In this case, we agree with the BLR and the CA that respondent could not have possibly committed misrepresentation, fraud, or false statements. The alleged failure of respondent to indicate with mathematical precision the total number of employees in the bargaining unit is of no moment, especially as it was able to comply with the 20% minimum membership requirement.

COSEP

G.R. No. 178989

March 18, 2010

EAGLE RIDGE GOLF & COUNTRY CLUB, vs. CA and EAGLE RIDGE EMPLOYEES UNION (EREU)

for the cancellation of the said Reg. Cert. Eagle Ridge’s petition ascribed misrepresentation, false statement, or fraud to EREU in connection with the adoption of its constitution and by-laws, the numerical composition of the Union, and the election of its officers. ISSUE: Whether or not the Union possesses bona fide compliance of the registration requirements under Art. 234 of the Code, explaining the seeming discrepancies between the number of employees who participated in the organizational meeting and the total number of union members at the time it filed its registration, as well as the typographical error in its certification which understated by one the number of union members who ratified the union’s constitution and by-laws. RULING: Yes, it does.

FACTS: On December 6, 2005, at least 20% of Eagle Ridge’s rank-and-file employees (with 26 employees of Eagle Ridge attending) had a meeting where they organized themselves into an independent labor union, named "Eagle Ridge Employees Union" (EREU or Union), elected a set of officers, and ratified their constitution and by-laws. On December 19, 2005, the Union formally filed its formal application for registration before the DOLE Regional Office IV, indicating a total of 30 union members with the inclusion of four additional members. In time, DOLE RO IV granted the application and issued EREU Registration Certificate (Reg. Cert.) No. RO400-200512-UR-003. The EREU, on January 10, 20016, then filed a petition for certification election in Eagle Ridge Golf & Country Club. On February 13, 2006, Eagle Ridge opposed this petition, followed by its filing of a petition

Before their amendment by Republic Act No. 948140 on June 15, 2007, the then governing Art. 234 (on the requirements of registration of a labor union) and Art. 239 (on the grounds for cancellation of union registration) of the Labor Code respectively provided as follows: Article 234, REQUIREMENTS OF REGISTRATION states that “Any applicant labor organization, association or group of unions or workers shall acquire legal personality and shall be entitled to the rights and privileges granted by law to legitimate labor organizations upon issuance of the certificate of registration based on the following requirements: (a) Fifty pesos (P50.00) registration fee; (b) The names of its officers, their addresses, the principal address of the labor organization, the minutes of the organizational meetings and the list of workers who participated in such meetings;

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 26 (c) The names of all its members comprising at least twenty percent (20%) of all the employees in the bargaining unit where it seeks to operate; (e) Four copies (4) of the constitution and bylaws of the applicant union, minutes of its adoption or ratification and the list of the members who participated in it.” The Union submitted the required documents attesting to the facts of the organizational meeting on December 6, 2005, the election of its officers, and the adoption of the Union’s constitution and by-laws. It submitted before the DOLE Regional Office with its Application for Registration and the duly filled out BLR Reg. Form No. I-LO, s. 1998. Evidently, as the Union persuasively argues, the withdrawal of six member-employees from the Union will affect neither the Union’s registration nor its petition for certification election, as their affidavits of retraction were executed after the Union’s petition for certification election had been filed. The initial five affidavits of retraction were executed on February 15, 2006; the sixth, on March 15, 2006. Indisputably, all six were executed way after the filing of the petition for certification election on January 10, 2006. Additionally, Article 239, GROUNDS FOR CANCELLATION OF UNION REGISTRATION provides that “the following shall constitute grounds for cancellation of union registration: (a) Misrepresentation, false statements or fraud in connection with the adoption or ratification of the constitution and by-laws or amendments thereto, the minutes of ratification, and the list of members who took part in the ratification; xxxx (c) Misrepresentation, false statements or fraud in connection with the election of officers, minutes of the election of officers,

the list of voters, or failure to submit these documents together with the list of the newly elected/appointed officers and their postal addresses within thirty (30) days from election. (Emphasis supplied.)” A scrutiny of the records fails to show any misrepresentation, false statement, or fraud committed by EREU to merit cancellation of its registration. Twenty percent (20%) of 112 rank-and-file employees in Eagle Ridge would require a union membership of at least 22 employees (112 x 205 = 22.4). When the EREU filed its application for registration on December 19, 2005, there were clearly 30 union members. Thus, when the certificate of registration was granted, there is no dispute that the Union complied with the mandatory 20% membership requirement. Besides, it cannot be argued that the six affidavits of retraction retroact to the time of the application of registration or even way back to the organizational meeting. Prior to their withdrawal, the six employees in question were bona fide union members. More so, they never disputed affixing their signatures beside their handwritten names during the organizational meetings. While they alleged that they did not know what they were signing, it bears stressing that their affidavits of retraction were not re-affirmed during the hearings of the instant case rendering them of little, if any, evidentiary value. With the withdrawal of six union members, there is still compliance with the mandatory membership requirement under Art. 234(c), for the remaining 24 union members constitute more than the 20% membership requirement of 22 employees. G.R. No. 177024

October 30, 2009

THE HERITAGE HOTEL MANILA (OWNED AND OPERATED BY GRAND PLAZA HOTEL CORPORATION) Petitioner, vs. PINAG-ISANG GALING AT LAKAS NG

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 27 MGA MANGGAGAWA SA HERITAGE MANILA (PIGLAS-HERITAGE), Respondent. FACTS: Sometime in 2000, certain rank and file employees of petitioner Heritage Hotel Manila formed and was later issued a certificate of registration for the "Heritage Hotel Employees Union". Subsequently, the HHE union filed a petition for certification election that the petitioner company opposed even though the Med-Arbiter granted the HHE union’s petition for certification election. The company alleged that the HHE union misrepresented itself to be an independent union, when it was, in truth, a local chapter of the National Union of Workers in Hotel and Restaurant and Allied Industries (NUWHRAIN). Thus, the company also filed a petition for the cancellation of the HHE union’s registration certificate. On October 12, 2001, the Court of Appeals issued a writ of injunction against the holding of the HHE union’s certification election. The decision of the Court of Appeals became final when the HHE union withdrew the petition for review that it filed with this Court. On December 10, 2003, certain rank and file employees of the company formed another union, the respondent Pinag-Isang Galing at Lakas ng mga Manggagawa sa Heritage Manila (the PIGLAS union). This union applied for and was granted the registration on February 9, 2004. Two months later, the members of the first union, the HHE union, adopted a resolution for its dissolution. The HHE union then filed a petition for cancellation of its union registration. On September 4, 2004, respondent PIGLAS union filed a petition for certification election that petitioner company also opposed, alleging that the new union’s officers and members were also those who comprised the old union. On December 6, 2004 petitioner company filed a petition to cancel the union registration of respondent PIGLAS union. The company

claimed that the documents submitted with the union’s application for registration bore many false information. ISSUE: Whether or not "dual unionism" is a ground for cancelling a union’s registration. RULING: No, it is not. The fact that some of respondent PIGLAS union’s members were also members of the old rank and file union, the HHE union, is not a ground for cancelling the new union’s registration. The right of any person to join an organization also includes the right to leave that organization and join another one. Besides, HHE union is dead. It had ceased to exist and its certificate of registration had already been cancelled. Thus, petitioner’s arguments on this point may also be now regarded as moot and academic. G.R. No. L-33987 September 4, 1975 LIBERTY COTTON MILLS WORKERS UNION, RAFAEL NEPOMUCENO, MARIANO CASTILLO, NELLY ACEVEDO, RIZALINO CASTILLO and RAFAEL COMBALICER, petitioners, vs. LIBERTY COTTON MILLS, INC., PHILIPPINE ASSOCIATION OF FREE LABOR UNION (PAFLU) and the COURT OF INDUSTRIAL RELATIONS, respondents.

FACTS: The Liberty Cotton Mills Workers Union adopted its Constitution and By-laws on January 1, 1959. On October 1, 1959, a Collective Bargaining Agreement 2 was entered into by and between the Company and the Union represented by PAFLU. On March 13, 1964, while the Collective Bargaining Agreement was in full force, Marciano Castillo and Rafael Nepomuceno, President and VicePresident, respectively, of the local union, wrote PAFLU, its mother federation,

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 28 complaining about the legal counsel assigned by the PAFLU to assist them in a ULP case (Case No. 4001) they filed against the Company. In said letter, the local union expressed its dissatisfaction and loss of confidence in the PAFLU lawyers, claiming that PAFLU never lifted a finger regarding this particular complaint. On May 17, 1964, thirty two (32) out of the 36 members of the local union disaffiliated themselves from respondent PAFLU pursuant to their local union's Constitution and ByLaws. A copy of the signed resolution of disaffiliation was furnished the Company as well as the Bureau of Labor Relations. The following day, the local union wrote the Company and required the turn-over of the checked-off dues directly to its Treasurer. On May 29,1964, PAFLU wrote the Company for the second time, this time quoting en toto Article III of the Collective Bargaining Agreement on "Union Security" and requesting the termination of the employment of Rafael Nepomuceno, Marciano Castillo, Nelly Acevedo, Enrique Managan, Rizalino Castillo and Rafael Combalicer, all petitioners herein. PAFLU at the same time expelled the aforementioned workers from their' union membership in the mother federation for allegedly "instigating union disaffiliation." On May 30,1964, the Company terminated the employment of the members expelled by the PAFLU. On the last day of May, 1964, counsel for the ousted workers wrote the Company requesting their reinstatement. This was denied by the Company; hence the complaint for unfair labor practice filed with the Court of Industrial Relations. ISSUE: Whether or not the dismissal of the complaining employees was justified or not. RULING: It is claimed by PAFLU that the local union could not have validly disaffiliated from it as the Union Security Clause so provided.

The courts cannot agree with both the stand of PAFLU and the respondent court. For while it is correct to say that a union security clause did exist, this clause was limited by the provision in the Unions' Constitution and ByLaws, which states: “That the Liberty Cotton Mills Workers UnionPAFLU shall be affiliated with the PAFLU, and shall remain an affiliate as long as ten (10) or more of its members evidence their desire to continue the said local unions affiliation.” Record shows that only four (4) out of its members remained for 32 out of the 36 members of the Union signed the resolution of disaffiliation on May 17, 1964, triggered by the alleged negligence of PAFLU in attending to the needs of its local union, particularly its failure to assign a conscientious lawyer to the local to attend to the ULP case they filed against the Company. The disaffiliation was, therefore, valid under the local's Constitution and By-Laws which, taken together with the Collective Bargaining Agreement, is controlling. Considering that the dispute revolved around the mother federation and its local, with the company dismissing the workers at the instance of the mother federation, it is believed that the company's liability should be limited to the immediate reinstatement of the workers. G.R. No. 74841 December 20, 1991 ASSOCIATED LABOR UNIONS-VIMCONTU, THE CEBU OIL EMPLOYEES ASSOCIATION, represented by its Acting President, MIGUEL C. ALIVIADO, and THE MOBIL DAVAO/ COTABATO CHAPTER-ALU, represented by its President, DAVID C. ONDEVILLA, petitioners, vs. THE NATIONAL LABOR RELATIONS COMMISSION (NLRC), MOBIL OIL PHILIPPINES, INC., JEAN PIERRE

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 29 BAILLEUX, CALTEX PHILIPPINES, INC., and MOBIL PHILIPPINES, INC., respondents.

FACTS: A collective bargaining agreement was entered into between the complainants and the respondent Mobil Oil Philippines, Inc. for a period of three years starting from April 1, 1982 to March 31, 1985. On August 5, 1983, respondent J.P. Bailiux, President of Mobil Oil Philippines, Inc. sent letters to the employees, notifying of the termination of their services effective August 31, 1983 because of the sale of the respondent firm. On September 13, 1983, complainant employee accepted their checks for separation pay and signed quitclaims under protest and subject to the outcome of this case. Caltex Philippines, Inc. was impleaded as additional respondent because of its acquisition of the entire marketing and distribution assets of Mobil Oil Philippines. Mobil Philippines, Inc. was also made a respondent in view of a metropolitan daily newspaper announcement that Mobil Oil Philippines, Inc. will continue to do business under the corporate name of Mobil Philippines, Inc. and that this newly formed company will market chemicals and special products such as solvents, process products, waxes and industrial asphalt, fuels and lubricants for the international marine and aviation industries. Complainants charge respondent Mobil Oil Philippines, Inc. and J.P. Bailiux with unfair labor practice for violating their collective bargaining agreement which, among others, states that "this Agreement shall be binding upon the parties hereto and their successors and assigns, and may be assigned by the company without the previous approval of the Union. However, the latter will be notified of such assignment when it occurs." In this case,

the complainant unions were not notified officially of such assignment to Caltex Philippines and respondent Mobil Oil Philippines made announcement in major dailies that the company shall continue to operate its business. ISSUE: Whether or not respondents Caltex and MOPI bound by the provisions of the CBA. RULING: Yes, the Commission finds that although Caltex is bound by the said agreement under Section I thereof, the rights and interests or benefits that may have been earned during the remaining term of the CBA have been satisfied by MOPI when herein complainants accepted their respective checks and executed quitclaim from and in favor of the firm. In G.R. No. 74841, petitioners assail the above decision and contend that the NLRC committed serious errors of law and grave abuse of discretion when it ruled to justify the termination that : (a) petitioners had knowledge of the impending sale to Caltex and closure of the company in a series of negotiations/meetings by considering it as a sufficient notice of termination; (b) the situation was one of closure and not redundancy; (c) the rights and interests or benefits that may have been earned during the remaining term of the CBA have been satisfied by MOPI when complainants accepted their respective checks and executed quitclaim from and in favor of the firm; (d) the benefits granted by respondent MOPI were far above the benefits provided by law; and (e) as regards the liability of Mobil Philippines, Inc., there is no concrete evidence to establish or prove complainants' allegation that MOPI will continue its business. G.R. No. L-24711,; Apr 30, 1968 BENGUET CONSOLIDATED, INC. vs. BCI EMPLOYEES & WORKERS UNION-PAFLU,

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 30 PHILIPPINE ASSOCIATION OF FREE LABOR UNIONS, CIPRIANO CID and JUANITO GARCIA FACTS: On June 23, 1959, the Benguet-Balatoc Workers Union (“BBWU”), for and in behalf of all Benguet Consolidated, Inc (Benguet) employees in its mines and milling establishment located at Balatoc, Antamok and Acupan, Mt. Province, entered into a Collective Bargaining Contract with Benguet. The contract was stipulated to be effective for a period of 4-1/2 years, or from June 23, 1959 to December 23, 1963. It likewise embodied a No-Strike, No-Lockout clause. Three years later, a certification election was conducted by the Department of Labor among all the rank and file employees of Benguet in the same collective bargaining units. BCI EMPLOYEES & WORKERS UNION (Union) obtained more than 50% of the total number of votes, defeating BBWU. The Court of Industrial Relations certified the UNION as the sole and exclusive collective bargaining agent of all BENGUET employees as regards rates of pay, wages, hours of work and such other terms and conditions of employment allowed them by law or contract. Later on, the UNION filed a notice of strike against BENGUET. UNION members who were BENGUET employees in the mining camps at Acupan, Antamok and Balatoc, went on strike. The strike was attended by violence, some of the workers and executives of the BENGUET were prevented from entering the premises and some of the properties of the BENGUET were damaged as a result of the strike. Eventually, the parties agreed to end the dispute. BENGUET and UNION executed the AGREEMENT. PAFLU placed its conformity thereto. About a year later or on January 29, 1964, a collective bargaining contract was finally executed between UNION-PAFLU and BENGUET.

Meanwhile, BENGUET sued UNION, PAFLU and their Presidents to recover the amount the former incurred for the repair of the damaged properties resulting from the strike. BENGUET also argued that the UNION violated the CONTRACT which has a stipulation not to strike during the effectivity thereof. Defendants unions and their presidents defended that: (1) they were not bound by the CONTRACT which BBWU, the defeated union, had executed with BENGUET; (2) the strike was due, among others, to unfair labor practices of BENGUET; and (3) the strike was lawful and in the exercise of the legitimate rights of UNION-PAFLU under Republic Act 875. The trial court dismissed the complaint on the ground that the CONTRACT, particularly the No-Strike clause, did not bind defendants. BENGUET interposed the present appeal. ISSUE: Whether or not the Collective Bargaining Contract executed between Benguet and BBWU on June 23, 1959 and effective until December 23, 1963 automatically bound UNION-PAFLU upon its certification, on August 18, 1962, as sole bargaining representative of all Benguet employees. RULING: No. Benguet erroneously invokes the so-called “Doctrine of Substitution” referred to in General Maritime Stevedore’s Union v. South Sea Shipping Lines where it was ruled that: “We also hold that where the bargaining contract is to run for more than two years, the principle of substitution may well be adopted and enforced by the CIR to the effect that after two years of the life of a bargaining agreement, a certification election may be allowed by the CIR, that if a bargaining agent other than the union or organization that executed the contract, is elected, said new agent would

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN

L A B O R R E L A T I O N S C A S E S - M S U | 31 have to respect said contract, but that it may bargain with the management for the shortening of the life of the contract if it considers it too long, or refuse to renew the contract pursuant to an automatic renewal clause.”

Since defendants were not contractually bound by the no-strike clause in the CONTRACT, for the simple reason that they were not parties thereto, they could not be liable for breach of contract to plaintiff.

Benguet’s reliance upon the Principle of Substitution is totally misplaced. This principle, formulated by the NLRB as its initial compromise solution to the problem facing it when there occurs a shift in employees’ union allegiance after the execution of a bargaining contract with their employer, merely states that even during the effectivity of a collective bargaining agreement executed between employer and employees thru their agent, the employees can change said agent but the contract continues to bind them up to its expiration date. They may bargain however for the shortening of said expiration date. In formulating the “substitutionary” doctrine, the only consideration involved was the employees’ (principal) interest in the existing bargaining agreement. The agent’s (union) interest never entered the picture. 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. 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.

BY: AMISTAD, BALBOA, CEDENIO, COSEP, GARCIA, LADJIMAN