G.R. No.

194192: June 16, 2015 Aggrieved, DCWD filed a Petition for Review under Rules 43 before the Court
DAVAO CITY WATER DISTRICT REPRESENTED V OFFICERS AND of Appeals. The Court of Appeals affirmed the resolution of CSC.
MEMBERS OF NAGKAHIUSANG MAMUMUO SA DAVAO CITY WATER
DISTRICT (NAMADACWAD) ISSUE:
Did the respondents conduct prohibited concerted mass actions? No.
BRIEFER: RULING:
Petitioner Davao City Water District (DCWD) is a government-owned and
controlled corporation in Davao City represented by its General Manager Section 5. Definition of Prohibited Concerted Mass Action. - As used in
Engr. Rodora N. Gamboa (GM Gamboa). The private respondents are officers this Omnibus Rules, the phrase ‘‘prohibited concerted activity or mass
and members of Nagkahiusang Mamumuo sa Davao City Water District action’’ shall be understood to refer to any collective activity undertaken by
(NAMADACWAD). They were charged with several administrative cases due to government employees, by themselves or through their employees
acts committed during the anniversary celebration of DCWD such as wearing organizations, with the intent of effecting work stoppage or service disruption
of t-shirts with inscriptions and posting of bond papers outside the in order to realize their demands of force concession, economic or otherwise,
designated places. The inscriptions and postings bore employees’ grievances. from their respective agencies or the government. It shall include mass
leaves, walkouts, pickets and acts of similar nature.
FACTS:
As early as 16 May 2007, the members and officers of NAMADACWAD have The operative phrases are "any collective activity" and "work stoppage
been staging pickets in front of the DCWD Office during their lunch breaks to or service disruption." Without the intent at work stoppage or service
air their grievances about the non-payment of their Collective Negotiation disruption, the concerted activity is not prohibited. The time and place of
Agreement (CNA) incentives and their opposition to DCWD’s privatization and the activity are not determinative of the prohibition. Whether done within
proposed One Hundred Million Peso Loan. government hours, a concerted activity is allowed if it is without any intent at
work stoppage.
Came the DCWD’s anniversary, officers and members sported t-shirts with
inscriptions "CNA Incentive Ihatag Na, Dir. Braganza Pahawa Na!" at the It is clear that the collective activity of joining the fun run in t-shirts
beginning of the Fun Run. Gregorio S. Cagula (Cagula), one of the members with inscriptions on CNA incentives was not to have work stoppage as
of the Board of Directors of NAMADACWAD, with the help of some of its an effect or to disrupt the service. The employees followed the advice of
members, attached similar inscriptions and posters of employees’ grievances GM Gamboa "to be there" at the fun run. Respondents joined, and did not
to a post in the motor pool area, an area not among the officially designated disrupt the fun run.
places for posting of grievances.
They did not violate the rule issued by GM Gamboa relating to the
GM Gamboa required those who committed the acts to explain the reasons proper attire to be worn during the fun run. To reiterate, the t-shirts they
for the attire they wore during the anniversary celebration. Through a wore fall within the description of "any sports attire" that the Memorandum
collective letter, the officers and members explained they were only required allowed to be worn.
to wear any sports attire, though theirs were with additional inscriptions
containing grievances. They were also required to explain within 72-hours Furthermore, in line with the civil service rules and jurisprudence, the
why they should not be held liable for the actions committed by Cagula. Court concluded that a violation of an office memorandum, which was
issued as an internal rule to regulate the area for posting of grievances
GM Gamboa filed formal charges against the officers and members of inside the office premise, is only a light offense punishable by
NAMADACWAD to the Hearing Committee. They were held guilty as charged reprimand.
with penalties ranging from suspension to dismissal from service with all
accessory penalties under the CSC Law and Rules. The decision was Rules and regulations are issued to attain harmony, smooth operation,
appealed to the Civil Service Commission (CSC). maximize efficiency and productivity, with the ultimate objective of realizing
the functions of particular offices and agencies of the government.
The CSC granted the consolidated appeal and held that the collective act of
respondents in wearing t-shirts with grievance inscriptions during office IMPORTANT CONSIDERATION:
hours was not within the ambit of the definition of prohibited mass action It is correct to conclude that those who enter government service are
punishable. However, though not prohibited under the Resolution, the act subjected to a different degree of limitation on their freedom to speak their
was considered as an offense punishable under "Violation of Reasonable mind; however, it is not tantamount to the relinquishment of their
Office Rules and Regulations." constitutional right of expression otherwise enjoyed by citizens just by reason
of their employment.
 Samahan ng Manggagawa sa Hanjin Shipyard vs Bureau of Labor - As an expression of the right to self-organization, industrial,
Relations, Hanjin Heavy iIndustries and Construction Co., Ltd. (Scope of commercial and self-employed workers could form a workers'
the right to self-organization) association if they so desired but subject to the limitation that it
was only for mutual aid and protection
 Ruling: there was no misrepresentation on the part of the Samahan.
FACTS - The phrase, "KAMI, ang mga Manggagawa sa Hanjin Shipyard" if
 Alfie F. Alipio, the representative of the Samahan filed with the DOLE an translated, would be: "We, the workers at Hanjin Shipyard." The
application for registration of its name "Samahan ng Mga Manggagawa sa use of the preposition "at" instead of "of " would indicate that
Hanjin Shipyard" "Hanjin Shipyard" was intended to describe a place
o They attached a list of names of the association’s officers and members, - If it does affect the goodwill of the company, the remedy of Hanjin
signatures of the attendees of their meeting, copies of their Constitution is not to seek cancellation of registration, but to ask for a change
and By-Laws. in name.
o The application stated that the association has a total of 120 members.  BLR Appeal: sustained its ruling, but ordered the Samahan to
 The DOLE Regional Office No. 3, City of San Fernando, Pampanga issued remove the words “Hanjin Shipyard” from its name.
the corresponding certificate of registration in favor of Samahan on o CA: reversed again. So ruling is: the registration of the Samahan should
February 26, 2010. be cancelled.
 Subsequently, Hanjin Heavy Industries and Construction CO, Ltd. filed a  The registration of Samahan as a legitimate workers' association was
petition praying for the cancellation of the registration of the Samahan contrary to the provisions of Article 243 of the Labor Code.
o Ground: some of the members do not fall under any of the types of - Only 57 out of the 120 members were actually working in Hanjin
workers enumerated in the second sentence of Article 249. while the phrase in the preamble of Samahan's Constitution and
 According to them, only ambulant, intermittent, itinerant, rural By-laws, "KAMI, ang mga Manggagawa sa Hanjin Shipyard"
workers, self-employed, and those without definite employers may created an impression that all its members were employees of
form a workers' association HHIC.
o Hanjin also claimed that only one-third of the members of the - Such unqualified manifestation which was used in its application
association have definite employers, and the continued existence and for registration, was a clear proof of misrepresentation which
registration of the association would prejudice the company's goodwill. warranted the cancellation of Samahan's registration.
o Filed a supplemental petition, where Hanjin claimed that the Samahan  It also stated that the members of Samahan could not register it as a
committed a misrepresentation in connection with the list of members legitimate worker's association because the place where Hanjin's
and/or voters who took part in the ratification of their constitution and industry was located was not a rural area. Neither was there any
by-laws in its application for registration. evidence to show that the members of the association were
 Samahan allegedly made it appear that its members were all ambulant, intermittent or itinerant workers.
qualified to become members of the workers' association.
 Proceedings:
o DOLE Regional Director: ruled in favor of Hanjin and cancelled the ISSUES AND RULING
registration of the Samahan.  Whether or not the members can form an association of employees? Yes
 The preamble of the Constitution and By-Laws of the Samahan was o The right to self-organization includes the right to form a union,
an admission that all of its members are employees of Hanjin. It says workers' association and labor management councils.
“KAMI, ang mga Manggagawa sa HANJIN Shipyard (SAMAHAN).” o Connotes unionism, but workers can also form and join workers’
 The Samahan committed misrepresentation in its application for associations and labor management councils.
registration as it made an express representation that all of its o Basis:
members were employees of Hanjin  Section 3, Article XIII of the Constitution guarantees the right of all
o Bureau of Labor Relations: reversed Regional Director: so the workers to self-organize.
registration should not be cancelled.  Section 8, Article 3: The right of the people, including those
 Samahan claims Hanjin has no right to petition the cancellation of employed in the public and private sectors, to form unions,
its registration since the words "Hanjin Shipyard," as used in its associations, or societies for purposes not contrary to law shall not
application for registration, referred to a workplace and not as be abridged.
employer or company.   Article 3, LC: The State shall assure the rights of workers to self-
 BLR ruled that the law clearly afforded the right to self-organization organization, collective bargaining, security of tenure, and just and
to all workers including those without definite employers humane conditions of work.
o Article 252: the right to self-organization includes the right to form, join  Employer-employee relationship not mandatory for the creation of a
or assist labor organizations for the purpose of collective bargaining worker’s association.
through representatives of their own choosing and to engage in lawful - What the law simply requires is that the members of the workers'
concerted activities for the same purpose for their mutual aid and association, at the very least, share the same interest. The very
protection.  definition of a workers' association speaks of "mutual aid and
o Two notions of the right to self-organization: protection."
a) the liberty or freedom, that is, the absence of restraint which o The court ruled that the Samahan cannot be directed to form a Union
guarantees that the employee may act for himself without being for the purposes of collective bargaining instead of a workers’
prevented by law; and assocaitio, because the choice belongs to it.
b) the power, by virtue of which an employee may, as he pleases, join  Right to choose whether to form or join a union or workers'
or refrain from joining an association association belongs to workers themselves
o The law expressly allows and encourages the formation of labor  The right to form or join a labor organization necessarily includes the
organizations right to refuse or refrain from exercising the said right. Also inherent
 Labor organization: "any union or association of employees which in the right to self-organization is the right to choose whether to form
exists in whole or in part for the purpose of collective bargaining or a union for purposes of collective bargaining or a workers'
of dealing with employers concerning terms and conditions of association for purposes of providing mutual aid and protection.
employment." o Rebuttal of the claims of Hajin.
 A labor organization has two broad rights:  That the employees have definite employers thus should have formed
- (1) to bargain collectively and a Union: untenable. There is no provision in the Labor Code that
- (2) to deal with the employer concerning terms and conditions of states that employees with definite employers may form, join or
employment. assist unions only.
 To bargain collectively is a right given to associations duly registered  Not covered by Article 243 “Ambulant, intermittent and itinerant
with the DOLE. workers, self-employed people, rural workers and those without any
 A union refers to any labor organization in the private sector definite employers may form labor organizations for their mutual aid
organized for collective bargaining and for other legitimate and protection.”
purpose, while a workers' association is an organization of workers - Workers with definite employers cannot be precluded from
formed for the mutual aid and protection of its members or for any joining a workers association for mutual aid and protection.
legitimate purpose - The right to form a workers' association is not exclusive to
- While every labor union is a labor organization, not every labor ambulant, intermittent and itinerant workers. The option to form
organization is a labor union. The difference is one of or join a union or a workers' association lies with the workers
organization, composition and operation themselves, and whether they have definite employers or not.
o Collective bargaining is only one form of employee participation. It is  Whether or not the registration should be cancelled? No
not the only device which secures industrial democracy. o Misrepresentation, as a ground for the cancellation of registration of a
 Real aim is employee participation in whatever form it may appear, labor organization, is committed "in connection with the adoption, or
bargaining or no bargaining, union or no union. ratification of the constitution and by-laws or amendments thereto, the
 Any labor organization which may or may not be a union may deal minutes of ratification, the list of members who took part in the
with the employer. This explains why a workers' association or ratification of the constitution and by-laws or amendments thereto, and
organization does not always have to be a labor union and why those in connection with the election of officers, minutes of the election
employer-employee collective interactions are not always collective of officers, and the list of voters
bargaining.  To be a ground for cancellation, misrepresentation should be done
o Article 261 of the Labor Code mandates that workers shall have the maliciously and deliberately. Which is absent in this case.
right to participate in policy and decision-making processes of the o There was no misrepresentation.
establishment where they are employed insofar as said processes will
directly affect their rights, benefits and welfare.  The use of such words "KAMI, ang mga Manggagawa sa HANJIN Shipyard" in
o Difference: the preamble of the constitution and by-laws did not constitute
 If there is no employer-employee relationship: no duty to bargain misrepresentation so as to warrant the cancellation of Samahan's certificate
collectively of registration
- Workers must be employed in the establishment before they can
participate in policy and decision-making processes.
SOCIETE INTERNATIONALE DE TELECOMMUNICATIONS under the CBA, the employees must be members of the bargaining unit, but
AERONAUTIQUES (SITA), SITA INFORMATION NETWORKING not necessarily of the labor organization designated as the bargaining agent.
COMPUTING B.V. (SITA, INC.), EQUANT SERVICES, INC. (EQUANT) AND To be considered a company practice, the giving of the benefits should have
LEE CHEE WEE, Petitioners, v. THEODORE L. HULIGANGA, Respondent. been done over a long period of time, and must be shown to have been
Facts: consistent and deliberate. The test or rationale of this rule on long practice
Huliganga was hired by Societe International De Telecommunications requires an indubitable showing that the employer agreed to continue giving
Aeronautiques (SITA) on April 16, 1980 as Technical Assistant to the the benefits knowing fully well that said employees are not covered by the law
Representative-Manager. Eventually, he became the Country Operating requiring payment thereof.
Officer, the highest accountable officer of SITA in the Philippines and his In her affidavit, Ms. Beaniza, Administrative Assistant to the Country
current position at the time of his retirement on December 31, 2008. He Manager/Representative, stated that respondent SITA had consistently
received his retirement benefits computed at 1.5 months of basic pay for adopted the policy to extend to managerial and confidential employees all
each year of service, or the total amount of P7,495,102.84 in retirement and favorable benefits agreed upon in the CBA with union members. However, as
other benefits. correctly held by the Labor Arbiter, the said affidavit deserves scant
On January 27, 2009, Huliganga filed a Complaint against SITA, SITA consideration considering that Ms. Beaniza had been retired from service
Information Networking Computing B. V. (SITA, INC.) and Equant Services, since 1997 or 12 years ago. She, therefore, lacks the competency to
Inc. (EQUANT) for unfair labor practices, underpayment of salary/wages, determine with accuracy what is considered a company practice. It was also
moral and exemplary damages, attorney's fees, underpayment of sick and held by the Labor Arbiter that even if Ms. Beaniza's retirement was based on
vacation leave and retirement benefits. the rate provided in the then prevailing CBA, this does not convert the
In his Position Paper, Huliganga alleged the following: (1) The concession into a company practice.
coefficient/payment factor that applies to him should be 2 months and not
1.5 months for every year of service in accordance with the 2005-2010 The Court also have noted that though Ms. Beaniza stated that company
Collective Bargaining Agreement; (2) The coefficient/payment factor as policies have been implemented as early as the time when SITA Employees'
provided under the 2005-2010 is the applicable rate because it is already a Union was formed in the 1970s, she was employed by respondent SITA only
well-established company practice of SITA to adopt, update and apply the in September 1980. Accordingly, she cannot testify on matters or
new and/or additional economic benefits arising from the CBA as circumstances that happened before she was employed by SITA.
amendments to the Employee Regulations manual; (3) SITA, INC. is a foreign
corporation created by SITA in 2003 to concentrate on providing Air Ms. Beaniza attested that she and other previous retirees have availed of the
Transport Industry application whereas EQUANT was created by SITA in the company practice. However, she failed to name or identify any other
mid-1990s to cater to its non-airline customers; and (4) He was required by employee who had availed of the said company practice and given retirement
EQUANT to represent and manage its Philippine operations and was given benefits under the CBA. If indeed Ms. Beaniza was given retirement benefits
the additional task of managing SITA, INC. but was not compensated for his above the amount she is entitled to, this could be interpreted to be based
work at EQUANT and SITA, INC merely on the generosity on the part of SITA.
Petitioners, on the other hand, raised the following counter-arguments: (1)
Huliganga has already received from SITA the full amount of his retirement It is noted that Ms. Beaniza retired sometime in 1997. She, therefore, has no
and other monetary benefits; thus, his claim for any supposed deficiency has knowledge of circumstances that transpired after her retirement to present.
simply no basis; (2) There is no employer-employee relationship between She was in no position and had no authority to say that there was an
Huliganga, SITA, INC. and EQUANT which will entitle the former to a claim established long standing company policy of extending CBA benefits to
for salary and other monetary benefits from said entities; and (3) Having managerial employees.
received the full amount of his retirement and other benefits from his
employer SITA, Huliganga has no right to claim moral and exemplary In the same affidavit, Ms. Beaniza was supposed to have communicated to
damages and attorney's fees. SITA office based in Singapore stating that SITA's practice in the grant of
LA dismissed complaint. NLRC denied appeal. CA partially granted. retirement benefits was lifted from the CBA provisions existing at the time.
Issue: Whether or not Managerial employees of SITA are entitled to the Even if such communication was sent, it does not categorically prove or
retirement benefits under the CBA that is for rank-and-file employees. establish that CBA benefits were actually granted to managerial and
Ruling: confidential employees.
It is an indisputable fact that Huliganga was a managerial employee of SITA
and, as such, he is not entitled to retirement benefits exclusively granted to Huliganga, therefore, failed to substantially establish that there is an
the rank-and-file employees under the CBA. It must be remembered that established company practice of extending CBA concessions to managerial
under Article 245 of the Labor Code, managerial employees are not eligible to employees. Again, to be considered a company practice or policy, the act of
join, assist or form any labor organization. [T]o be entitled to the benefits extending benefits of the CBA to managerial employees must have been
practiced for a long period of time and must be shown to be consistent and
deliberate.
 Miranda Jr. vs. Asian Terminals Inc. the petitions at bar had been rendered moot and academic since the
petitioner was already reinstated to the position of Checker I.
Facts:
Petitioner was employed by respondent as a Checker I and a member Issue:
of the Associated Port Checkers and Workers Union (APCWU or the union). Whether the petitioner should be reinstated to the position of Shop
Petitioner was then the Vice President of the union and appointed to the Steward.
position of Shop Steward which is a union position under the payroll of the
company. The CBA between the union and company provided for the Held:
appointment of a Shop Steward from among the union members upon No, Petitioner cannot be reinstated to Shop Steward due to his valid
recommendation of the union president. The Shop Steward is a field retrenchment.
representative of both the company and the union and acts as an Notwithstanding the determination of the Med-Arbiter, as affirmed by
independent arbiter of all complaints brought to his attention. the Secretary of Labor, that the petitioner should be reinstated to the
On December 28, 1993, Roger P. Silva, the President of APCWU, position of Shop Steward, which is binding on this Court, the petitioner could
wrote a letter to the petitioner regarding the recall of his designation as the not be reinstated to the position of Shop Steward because his eventual
union Shop Steward. The union president explained that the petitioner was separation from respondent ATI made reinstatement unfeasible.
recalled as union Shop Steward due to loss of trust and confidence in him,
pursuant to the "Agreement Amending the MPSI (Marina Port Services, Inc.) - Employment with respondent ATI and membership in the union are
APCWU CBA." The letter further stated that the petitioner refused to heed the required in order to occupy the position of Shop Steward. But the petitioner
union president's reminders concerning his "chronic absenteeism" that "is is neither a member of the union nor employed with respondent ATI. He was
hurting the interest of the Union members as they are left with no already retrenched from respondent ATI since October 21, 2001, and his
responsible union officer when summoned for investigation concerning retrenchment was finally settled through the execution of a Quit Claim and
alleged infractions of company rules." the company recommends the recall of Release which was executed before the Second Division of the NLRC. The
the petitioner as Shop Steward and reversion to his former position as Quit Claim and Release provides that in consideration of the receipt
Checker in accordance with the CBA. Petitioner filed a complaint with the of P367,500.00, the petitioner discharges respondent ATI and its officers
DOLE against Roger Silva as the President of APCWU praying for his from any claims arising from his retrenchment, without prejudice to the
reinstatement as the Shop Steward. present labor case filed by the petitioner. The present labor case proceeded
despite the execution of the Quit Claim and Release. However, the resolution
LA ruling: of this petition is inevitably affected by the retrenchment of the petitioner
Judgment was made finding complainant to have been constructively from respondent ATI.
dismissed from employment in February, 1996 and ATI was ordered to
reinstate complainant with backwages.
Since the Shop Steward is a union position, the controversy
NLRC ruling: surrounding his recall from his position as Shop Steward becomes a dispute
The NLRC ordered that the case be remanded to the sala of Labor Arbiter within the union. In this case, the duties and respinbilities of the Shop
Amansec for clarification of its decision. Steward stated in the CBA between the union and the respondent company,
as well as the manner of the appointment and designation of the Shop
The Special Third Division of the NLRC ruled that there is no need to execute Steward show that the Shop Steward is a union position and not a position
the reinstatement aspect of the decision of Labor Arbiter Amansec since it within the company. An “internal union dispute” or inta-union conflict refers
has been rendered moot and academic by the petitioner's re-employment as to a conflict within or inside a labor union. It includes all disputes or
Checker I prior to the rendition of Labor Arbiter Amansec's decision up to the grievances arising from any violation of or disagreement over any provision of
time of his admitted retrenchment the Constitution and by-laws of a union, including any violation of the rights
and conditions of union membership provided for in the Code. Article 226 of
CA Ruling: the Labor Code of the Philippines vests on the Bureau of Labor Relations and
It ruled that the reinstatement aspect of the labor arbiter's decision is the Labor Relations Division the jurisdiction to act on an inter-union or
immediately executory and not even the filing of an appeal or the posting of a intra-union conflicts.
bond could forestall the same. However, the confusion remained as to which The Supreme Court dismissed the case for being moot and academic.
position the petitioner should be reinstated.

The Court of Appeals issued an Amended Decision on August 31, 2005,

which vacated its earlier decision rendered on June 27, 2005, and ruled that
G.R. No. 192648, March 15, 2017 same nature, receive the same wages and compensation, nor share a
DE OCAMPO MEMORIAL SCHOOLS, INC., Petitioner, v. BIGKIS common stake in concerted activities. While these factors dictate the
MANGGAGAWA SA DE OCAMPO MEMORIAL SCHOOL, INC., Respondent. separation of the categories of employees for purposes of collective
bargaining, the CA reasoned that such lack of mutuality and commonality of
FACTS: interest of the union members is not among the grounds for cancellation of
union registration under Article 239 of the Labor Code.
De Ocampo Memorial Schools, Inc. is a domestic corporation duly-
organized and existing under the laws of the Philippines. It has two main ISSUE:
divisions, namely: De Ocampo Memorial Medical Center, its hospital entity,
and the De Ocampo Memorial Colleges, its school entity. Whether BMDOMSI committed fraud/false representation in its application
justifying the cancellation of its registration? NO, there is no reason to cancel
On September 26, 2003, Union Registration No. NCR-UR-9-3858- as none of the grounds mentioned under the law are present.
2002 was issued in favor of Bigkis Manggagawa sa De Ocampo Memorial
Medical Center - LAKAS RULING

On December 5, 2003, Bigkis Manggagawa sa De Ocampo Memorial Art. 247. Grounds for Cancellation of Union Registration. - The following may
School, Inc. was issued a Union Registration/Certificate of Creation of Local constitute grounds for cancellation of union registration:
Chapter No. NCR-12-CC-002-2003 and declared a legitimate labor
organization. (c) Voluntary dissolution by the members.
For fraud and misrepresentation to constitute grounds for cancellation of
De Ocampo filed a Petition for Cancellation of Certificate of union registration under the Labor Code, the nature of the fraud and
Registration with the DOLE-NCR. It sought to cancel the Certificate of misrepresentation must be grave and compelling enough to vitiate the
Registration of BMDOMSI on the following grounds: 1) misrepresentation, consent of a majority of union members.
false statement and fraud in connection with its creation and registration as
a labor union as it shared the same set of officers and members with We agree with the BLR and the CA that BMDOMSI did not commit
BMDOMMC; 2) mixed membership of rank-and-file and fraud or misrepresentation in its application for registration. The applicant
managerial/supervisory employees; and 3) inappropriate bargaining unit. De indicated in the portion "Description of the Bargaining Unit" that it is
Ocampo filed a Supplemental Petition, informing the DOLE-NCR of the composed of "Rank and File" and under the "Occupational Classification," it
cancellation of the Certificate of Registration of BMDOMMC in Case No. NCR- marked "Technical" and "Faculty."
OD-0307-009-LRD.
Members appearing in the Minutes of the General Membership and
Regional Director: BMDOMSI committed misrepresentation by making it the List of Workers or Members who attended the organizational meeting and
appear that the bargaining unit is composed of faculty and technical adopted/ratified the Constitution and By-Laws are, as represented,
employees. In fact, all the union officers and most of the members are from employees of the school and the General Services Division, though some of
the General Services Division. the latter employees service the hospital. There is nothing in the form "Report
of Creation of Local Chapter" that requires the applicant to disclose the
BLR: reversed the Regional Director's finding of misrepresentation, false existence of another union, much less the names of the officers of such other
statement or fraud in BMDOMSI's application for registration. De Ocampo union. Thus, we cannot see how BMDOMSI made the alleged
failed to adduce proof to support its allegation of mixed membership within misrepresentation or false statements in its application.
respondent union.
While the CA may have ruled that there is no mutuality or
CA: affirmed the Decision of the BLR. It ruled that there was no commonality of interests among the members of BMDOMSI, this is not
misrepresentation, false statement or fraud in the application for registration. enough reason to cancel its registration. The only grounds on which the
cancellation of a union's registration may be sought are those found in
However, the CA observed that the members of the union, who are from Article 247 of the Labor Code.
academic, non-academic, and general services, do not perform work of the
 A party seeking the cancellation of a union's certificate of registration
must bear in mind that:[A] direct challenge to the legitimacy of a labor
organization based on fraud and misrepresentation in securing its certificate of
registration is a serious allegation which deserves careful scrutiny. Allegations
thereof should be compounded with supporting circumstances and evidence.
The records of the case are devoid of such evidence.
G.R. No. 207971  The resolution of this issue cannot be pre-empted; until it is
ASIAN INSTITUTE OF MANAGEMENT, Petitioner, vs. ASIAN INSTITUTE OF determined with finality in G.R. No. l 97089, the petition for
MANAGEMENT FACULTY ASSOCIATION, Respondent. cancellation of respondent's certificate of registration on the grounds
FACTS: alleged by petitioner cannot be resolved.
 On May 16, 2007, AFA filed a petition for certification election  The resolution of the issue relative to the nature of respondent's
seeking to represent a bargaining unit in AIM consisting of forty (40) membership pending in G.R. No. 197089, this case is ordered
faculty members. CONSOLIDATED with G.R. No. 197089.
 On July 11, 2007, petitioner filed a petition for cancellation of  Court cannot decide on the registration of AFA as there is a case
respondent's certificate of registration on the grounds of pending on the nature of AFA’s employment, whether it is managerial
misrepresentation in registration and that respondent is composed of or not.
managerial employees who are prohibited from organizing as a
union.
 On August 30, 2007, the Med-Arbiter in issued an Order denying the
petition for certification election on the ground that AIM' s faculty
members are managerial employees.
 This Order was appealed by respondent before the Secretary of the
Department of Labor and Employment, who reversed the decision
(via a February 20, 2009 Decision 11 and May 4, 2009 Resolution).
 an Order14 dated February 16, 2009 was issued by DOLE-NCR
Regional Director Raymundo G. Agravante granting AIM's petition for
cancellation of respondent's certificate of registration and ordering its
delisting from the roster of legitimate labor organizations. 1bis Order
was appealed by respondent before the Bureau labor Relations15
(BLR), which, in a December 29, 2009 Decision,16 reversed the same
and ordered respondent's retention in the roster of legitimate labor
organizations.
 Petitioner filed a Petition for Certiorari before the CA, questioning the
DOLE Secretary's February 20, 2009 Decision and May 4, 2009
Resolution,
 CA affirmed dispositions of the BLR; validating the respondent's
certificate of registration

ISSUE/S:
 WON AFA is eligible to register as a Labor Organization

RULING:
 In Holy Child Catholic School v. Hon. Sto. Tomas,30this Court
declared that "[i]n case of alleged inclusion of disqualified employees
in a union, the proper procedure for an employer like petitioner is to
directly file a petition for cancellation of the union's certificate of
registration due to misrepresentation, false statement or fraud under
the circumstances enumerated in Article 239 of the Labor Code, as
amended.”
 However, the issue of whether respondent's members are managerial
employees is still pending resolution by way of petition for review on
certiorari in G.R. No. 197089, which is the culmination of all
proceedings in DOLE Case No. NCR-OD-M-0705-007 -- where the
issue relative to the nature of respondent's membership was first
raised by petitioner itself and is there fiercely contested.
 PHILIPPINE AIRLINES EMPLOYEES ASSOCIATION (PALEA), HEREIN - COURT OF APPEALS: Dismissed the petition for certiorari and
REPRESENTED BY ALEXANDER O. BARRIENTOS VS. HON. HANS LEO J. ordered the Comelec to complete the canvass of the results of the
CACDAC (DIRECTOR OF BUREAU OF LABOR RELATIONS), et.al. April 5, 2002 election and to proclaim the winners.
G.R. No. 155097 : September 27, 2010
ISSUE:
FACTS: I. Was the filing of the petition for certiorari proper? NO.
- PALEA was the sole and exclusive bargaining representative of all
regular rank-and-file employees of Philippine Air Lines. II. Did the CA commit an error when it held that the election of the
- In February 2000, PALEA held a general election for its new officers PALEA union officers on April 5, 2002 was valid although the
through a commission on elections (Comelec) composed of a election was conducted not in accordance with the Constitution
chairman and two members appointed by the incumbent president and By-Laws or the applicable rule on election of officers of labor
with the concurrence of three-fourths of all the members of the organizations embodied in the rules implementing the Labor
Board of Directors. After the casting of votes, the Comelec canvassed Code?
the votes and proclaimed the winners.
- Upon the petition of some of the members of PALEA, the Regional JURISPRUDENCE:
Director of the BLR issued a resolution nullifying the general election
and the proclamation of the winners on the ground that the general I. NO, the filing of the petition for certiorari was not proper. The
election was found to be riddled with fraud and irregularities; and present petition for certiorari was actually filed to prevent the
ordered the holding of another general election under the direct conduct of the election of PALEA union officers scheduled on 5
supervision of the DOLE. April 2002.
- The BLR Director of the NCR affirmed the decision of the BLR
Regional Director. In view of its rationalization of its dismissal of the petition for
- Jose Peñas III, who was proclaimed as the president in the nullified certiorari, the CA acted properly and correctly considering that PALEA was
general election, filed a petition for certiorari in the Court of Appeals unjustified in commencing its special civil action for certiorari.
to annul the resolution. However, the CA dismissed the petition and
upheld the order for the conduct of another general election. Indeed, relief in a special civil action for certiorari is available only
- During the pre-election proceedings, some PALEA members assigned when the following essential requisites concur:
in the PAL Cargo Sub-department filed with the BLR Regional
Director a petition to conduct a plebiscite to amend the PALEA a. the petition must be directed against a tribunal, board, or officer
Constitution and By-Laws in order that they would have a exercising judicial or quasi-judicial functions;
representative in the PALEA Board of Directors. The filing of the b. the tribunal, board, or officer must have acted without or in
petition caused the BLR to suspend the conduct of the pre-election excess of jurisdiction or with grave abuse of discretion
conference until the issue was resolved. amounting to lack or excess of jurisdiction; and
- The BLR Regional Director dismissed the petition to conduct a c. there is no appeal, nor any plain, speedy and adequate remedy
plebiscite to amend the PALEA Constitution and By-Laws and in the ordinary course of law.
directed the immediate conduct of the general election. This order
was appealed. There is no concurrence of the requisites. Firstly, PALEA should have
- The BLR Director denied the appeal because the assailed order was first waited for the final election results as certified by DOLE-NCR before
not appealable for being interlocutory in nature pursuant to Section filing the petition for certiorari. As the BLR Director pointed out in the letter
5, Rule XXV of Department Order No. 9 of DOLE. dated February 27, 2002, the petition for the plebiscite to amend PALEA's
- PALEA elevated the denial of the appeal to the BLR Director. Constitution and By-Laws was merely incidental to the conduct of the
general election pursuant to the final and executory decision of the BLR. As
- Meanwhile, Comelec proceeded with the pre-election conference and
such, the recourse open to PALEA was not to forthwith file the petition for
the general election was set on April 5, 2002.
certiorari to assail such denial, but to first await the final election results as
- PALEA then filed a petition for certiorari, ascribing grave abuse of
certified by DOLE-NCR. That PALEA did not so wait signified that it ignored
discretion to the Regional Director and the BLR Director and prayed
the character of certiorari as an extraordinary recourse to resort to when
that a temporary restraining order (TRO) be issued to restrain the
there is no plain, speedy and adequate remedy in the ordinary course of law.
holding of the general election scheduled on April 5, 2002.
And, secondly, the Regional Director and the BLR Director were performing
- The CA issued a TRO on the day of the general election, but the the purely ministerial act of enforcing the already final and executory BLR
Comelec received the TRO only after the close of the polls and the resolution directing the conduct of the general election (which the CA had
canvass of the ballots was about to start.
affirmed in CA- G.R. SP-60886 through its final and executory judgment
dated March 28, 2001).

II. The CA did not unduly rule on the validity of the conduct of the
election. The statements on the validity of the election the CA
made were obiter dicta, or mere expressions of its opinion that
were not necessary to its decision to dismiss the petition for
certiorari.
COCA-COLA BOTTLERS PHILIPPINES, INC. vs. ILOCOS PROFESSIONAL - CCBPI filed and registered a Protest questioning the conduct and
AND TECHNICAL EMPLOYESS UNION (IPTEU) mechanics of the election and a Challenge to Votes on the ground
G.R. No. 193798; September 8, 2015 that the voters are supervisory and confidential employees.

FACTS: - On September 26, 2007, CCBPI filed a motion for inhibition, which
- Coca-Cola Bottlers Philippines, Inc. (CCBPI) is a domestic the Mediator-Arbiter verbally denied on the grounds that it was not
corporation duly organized and operating under the Philippine laws. verified and would cause undue delay on the proceedings as there
It is primarily engaged in the beverage business, which includes the are no other Mediators-Arbiters in the Region.
manufacture of carbonated soft drinks. - Mediator-Arbiter denied CCBPI’s challenge to the 16 votes. She found
- Ilocos Professional and Technical Employees Union (IPTEU) is a that the voters are rank-and-file employees holding positions that are
registered independent labor organization with address at CCBPI not confidential in nature, and who are not, or used to be, members
Ilocos Plant in Barangay Catuguing, San Nicolas, Ilocos Norte. of Ilocos Monthlies Union (IMU) due to the reclassification of their
- On July 9, 2007, IPTEU filed a verified Petition for certification positions by CCBPI and have been excluded from the CBA entered
election seeking to represent a bargaining unit consisting of into by IMU and CCBPI from 1997 to 2005. Consequently, the
approximately 22 rank-and-file professional and technical employees challenged votes were opened and canvassed. After garnering 14 out
of CCBPI Ilocos Norte Plant. of the 16 votes cast, IPTEU was proclaimed as the sole and exclusive
- CCBPI prayed for the denial and dismissal of the petition, arguing bargaining agent of the rank-and-file exempt workers in CCBPI Ilocos
that the Sales Logistics Coordinator and Maintenance Foreman are Norte Plant.
supervisory employees, and the rest of the said employees are - SOLE: denied the appeal of CCBPI.
confidential employees, hence, ineligible for inclusion as members of - CCBPI filed before the CA a petition for certiorari with prayer for
IPTEU. It also sought to cancel and revoke the registration of IPTEU temporary restraining order and writ of preliminary injunction.
for failure to comply with the 20% membership requirement based - Court of Appeals denied the petition and affirmed the Resolution of
on all the supposed employees in the bargaining unit it seeks to the Secretary of Labor and Employment.
operate.
- Mediator-Arbiter Florence Marie A. Gacad-Ulep granted IPTEU’S ISSUE:
petition. Med-arbiter was convinced that the union members are Did the Court of Appeals commit an error in denying the petition?
rank-and-file employees are not occupying positions that are NO.
supervisory or confidential in nature.
- CCBPI filed an appeal before the SOLE. JURISPRUDENCE:
- The Mediator-Arbiter acknowledged having received the
Memorandum of Appeal but informed that, pursuant to the IRR of As proven by the certification of the IMU President as well as the
the Labor Code, "the order granting the conduct of a certification CBAs executed between IMU and CCBPI, the 22 employees sought to be
election in an unorganized establishment shall not be subject to represented by IPTEU are not IMU members and are not included in the
appeal. Any issue arising therefrom may be raised by means of CBAs due to reclassification of their positions. If these documents were
protest on the conduct and results of the certification election." false, the IMU should have manifested its vigorous opposition. Between
- CCBPI then filed an Urgent Motion to Suspend Proceedings, alleging Management and IMU, it is the latter which has more to lose, as the creation
that the notice issued by the Assistant Regional Director for the of a separate bargaining unit would reduce the scope of IMU’s bargaining
conduct of pre-election conference is premature since the decision of unit. Yet through all these proceedings, we take note of the substantial moral
the Mediator-Arbiter is not yet final and executory and that the support that has been extended to the Petitioner by the other Unions of
Mediator-Arbiter already lost jurisdiction over the case with the filing CCBPI, so much so that, until objected to by Management, they were even
of an appeal. willing to be present during the Certification Election of 21 September 2007.
- Thereafter, CCBPI filed a Manifestation, stating that its participation
in the pre-election conference, certification election, and other As to whether the 16 voters sought to be excluded from the
proceedings is not a waiver, withdrawal or abandonment of the appropriate bargaining unit are confidential employees, such query is
pending appeal and motion to suspend proceedings. a question of fact, which is not a proper issue in a petition for review
- In the Pre-election Conference held on September 10, 2007, CCBPI under Rule 45 of the Rules. This holds more true in the present case in
and IPTEU mutually agreed to conduct the certification election. On view of the consistent findings of the Mediator-Arbiter, the SOLE, and the CA.
September 21, 2007. only 16 of the 22 employees in the IPTEU list
voted. However, no votes were canvassed. The office of a petition for review on certiorari under Rule 45
of the Rules of Court requires that it shall raise only questions of law.
The factual findings by quasi-judicial agencies, such as the
Department of Labor and Employment, when supported by substantial
evidence, are entitled to great respect in view of their expertise in their
respective fields. Judicial review of labor cases does not go so far as to
evaluate the sufficiency of evidence on which the labor official's findings rest.
It is not our function to assess and evaluate all over again the evidence,
testimonial and documentary, adduced by the parties to an appeal,
particularly where the findings of both the trial court (here, the DOLE
Secretary) and the appellate court on the matter coincide, as in this case at
bar. The Rule limits that function of the Court to the review or revision of
errors of law and not to a second analysis of the evidence. Thus, absent any
showing of whimsical or capricious exercise of judgment, and unless
lack of any basis for the conclusions made by the appellate court be
amply demonstrated, we may not disturb such factual findings.

The determination of factual issues is vested in the Mediator-Arbiter

and the Department of Labor and Employment. Pursuant to the doctrine of
primary jurisdiction, the Court should refrain from resolving such
controversies unless the case falls under recognized and well-established
exceptions. The doctrine of primary jurisdiction does not warrant a
court to arrogate unto itself the authority to resolve a controversy the
jurisdiction over which is initially lodged with an administrative body
of special competence.

In this case, organizational charts, detailed job descriptions, and

training programs were presented by CCBPI before the Mediator-Arbiter, the
SOLE, and the CA. Despite these, the Mediator-Arbiter ruled that employees
who encounter or handle trade secrets and financial information are not
automatically classified as confidential employees. It was admitted that the
subject employees encounter and handle financial as well as physical
production data and other information which are considered vital and
important from the business operations’ standpoint. Nevertheless, it was
opined that such information is not the kind of information that is relevant to
collective bargaining negotiations and settlement of grievances as would
classify them as confidential employees. The SOLE, which the CA affirmed,
likewise held that the questioned voters do not have access to confidential
labor relations information.

We defer to the findings of fact of the Mediator-Arbiter, the SOLE,

and the CA. Certainly, access to vital labor information is the imperative
consideration. An employee must assist or act in a confidential capacity and
obtain confidential information relating to labor relations policies. Exposure
to internal business operations of the company is not per se a ground for the
exclusion in the bargaining unit.
 Lepanto Consolidated Mining Company vs the Lepanto Capataz Union  Hence, the capatazes “differ from the rank-and-file and could by
(Determination of appropriate bargaining unit) themselves constitute a separate bargaining unit.”
o Capatazes or foremen are not rank-and-file employees because they are
an extension of the management, and as such they may influence the
FACTS rank-and-file workers under them to engage in slowdowns or similar
 Lepanto Capataz Union (Union), a labor organization duly registered with activities detrimental to the policies, interests or business objectives of
DOLE, filed a petition for consent election with the Industrial Relations the employers.
Division of the Cordillera Regional Office (CAR) of DOLE, thereby proposing
to represent 139 capatazes (foreman) of Lepanto. Eugene S. Arabit, et. al. vs Jardine Pacific Finance, Inc. (Mass Dismissal of
 Lepanto opposed the petition all union members ; piercing the veil of corporate responsibility)
o Claimed that the Union was in reality seeking a certification election,
and would be competing with the Lepanto Employees Union (LEU), the
current collective bargaining agent. FACTS
o Lepanto pointed out that the capatazes were already members of LEU,  Petitioners are employees of Jardine Pacific Finance, Inc.
the exclusive representative of all rank-and-file employees of its Mine o They were notified of their termination on the ground of cessation of
Division. operations due to serious business losses.
 Proceedings: o They believed their dismissal was without just cause and in violation of
o Med Arbiter: capatazes could form a separate bargaining unit, since due process because the closure of Phil Carpet was a mere pretense to
they are not ordinary rank-and-file employees. transfer its operations to its wholly owned and controlled corporation,
o DOLE Secretary: affirmed Med Arbiter’s decision. Added that there is no Pacific Carpet Manufacturing Corporation
other organization of capatazes within Lepanto.  Basis: job orders of some regular clients of Phil Carpet were
 Two modes to be recognized as the sole and exclusive bargaining transferred to Pacific Carpet; and from October to November 2011,
agent: several machines were moved from the premises of Phil Carpet to
a) Voluntary recognition: the employer voluntarily recognizes the Pacific Carpet
union as the bargaining representative of all the members in the  Dismissal constitutes unfair labor practice since it involved mass
bargaining unit sought to be represented dismissal of all union officers and members of the Philippine Carpet
b) By consent or certification election: members of the bargaining Manufacturing Employees Association (PHILCEA).
unit decide whether they want a bargaining representative and if  Phil Carpet countered that it permanently closed and totally ceased its
so, who they want it to be. operations because there had been a steady decline in the demand for its
 The difference between a consent election and a certification election products due to global recession, stiffer competition, and the effects of a
is that the conduct of a consent election is agreed upon by the changing market.
parties to the petition while the conduct of a certification election is o Incurred huge losses based on the audits of SGV and Co.
ordered by the Med-Arbiter. o The company implemented several cost-cutting measures, including
- In this case, the appellant withdrew its consent and opposed the voluntary redundancy and early retirement programs.
conduct of the election. Therefore, the petition necessarily o Business continued to decline, thus the Board of Directors decided to
becomes one of a petition for certification election and the Med- cease operations.
Arbiter was correct in granting the same o They also complied with the requisites for closure or cessation of a
o Med Arbiter: certified the Union as the sole and exclusive bargaining business.
agent of all capatazes of Lepanto. DOLE Secretary: affirmed the Med  Proceedings:
Arbiter. CA: dismissed o LA: dismissed the cases for illegal dismissal and unfair labor practices.
 Termination was due to total cessation of the operations of Philippine
Carpet due to business losses.
ISSUES AND RULING  Closure was truly dictated by economic necessity as evidenced by its
 Whether or not the capatazes could form their Union separate from rank- audited financial statements.
and file employees? o NLRC: affirmed decision of LA
 Yes. Capatazes perform functions totally different from those performed by o CA: total cessation of Phil Carpet's manufacturing operations was not
the rank-and-file employees. made in bad faith because the same was clearly due to economic
o They “supervise and instruct the miners, mackers and other rank-and- necessity.
file workers under them, assess and evaluate] their performance, make
regular reports and recommend new systems and procedure of work, as
well as guidelines for the discipline of employees.” ISSUES AND RULING
 Whether or not there was valid dismissal? Yes – authorized cause. o None of the tests have been met in this case.
o Article 298 of the Labor Code states that closure or cessation of  Ownership of a great number of stocks of another corporation is an
operation of the establishment is an authorized cause for terminating indicia of control, but by itself it does not establish an alter ego
an employee. relationship
o There was a valid closure since the company has been suffering  Mere ownership by a single stockholder or by another corporation of
business losses. all or nearly all of the capital stock of a corporation is not of itself
o Company also complied with requirements of due process. sufficient ground for disregarding the separate corporate personality
 Whether or not there was unfair labor practice? No  Existence of interlocking directors, corporate officers and
o Unfair labor practice refers to acts that violate the workers' right to shareholders is not enough justification to pierce the veil of
organize. corporate fiction in the absence of fraud or other public policy
 Thus, an employer may only be held liable for unfair labor practice if considerations.
it can be shown that his acts affect in whatever manner the right of
his employees to self-organize.
o The one who makes an allegation has the burden to prove it. The
petitioners in this case were unable to prove that Phil Carpet committed
acts which constitute unfair labor practice.
 Whether or not Pacific Carpet can inherit the obligaitons of Phil Carpet? No
o Pacific Carpet has a personality separate and distinct from Phil Carpet.
o A corporation is an artificial being created by operation of law. It
possesses the right of succession and such powers, attributes, and
properties expressly authorized by law or incident to its existence. It
has a personality separate and distinct from the persons composing it,
as well as from any other legal entity to which it may be related.
 Except: the corporate mask may be removed or the corporate veil
pierced when the corporation is just an alter ego of a person or of
another corporation.
o The doctrine of piercing the corporate veil applies only in three (3) basic
areas, namely:
 1) defeat of public convenience as when the corporate fiction is used
as a vehicle for the evasion of an existing obligation;
 2) fraud cases or when the corporate entity is used to justify a
wrong, protect fraud, or defend a crime; or
 3) alter ego cases, where a corporation is merely a farce since it is a
mere alter ego or business conduit of a person, or where the
corporation is so organized and controlled and its affairs are so
conducted as to make it merely an instrumentality, agency, conduit
or adjunct of another corporation.
o Three-pronged test to determine the application of the alter ego theory,
which is also known as the instrumentality theory
 1) Control, not mere majority or complete stock control, but complete
domination, not only of finances but of policy and business practice
in respect to the transaction attacked so that the corporate entity as
to this transaction had at the time no separate mind, will or
existence of its own;
 (2) Such control must have been used by the defendant to commit
fraud or wrong, to perpetuate the violation of a statutory or other
positive legal duty, or dishonest and unjust act in contravention of
plaintiff's legal right; and
 (3) The aforesaid control and breach of duty must have proximately
caused the injury or unjust loss complained of.
REPUBLIC OF THE PHILIPPINES vs. KAWASHIMA TEXTILE MFG., certification election. This infirmity in union membership cannot be
PHILIPPINES, INC. corrected in the inclusion-exclusion proceedings during the pre-election
conference.
Facts:

Issue:  1. Whether a mixed membership of rank-and-file and supervisory

On January 24, 2000, Kawashima Free Workers Union filed with DOLE
employees in a union is a ground for the dismissal of a petition for
Regional Office No. IV, a Petition for Certification Election to be conducted in
certification election in view of the amendment brought about by D.O. 9,
the bargaining unit composed of 145 rank-and-file employees of respondent. 
series of 1997, which deleted the phraseology in the old rule that "[t]he
appropriate bargaining unit of the rank-and-file employee shall not include
Respondent filed a Motion to Dismiss the petition on the ground that KFWU the supervisory employees and/or security guards?
did not acquire any legal personality because its membership of mixed rank-
and-file and supervisory employees violated Article 245 of the Labor Code, 2. Whether the legitimacy of a duly registered labor organization can be
and its failure to submit its books of account. collaterally attacked in a petition for a certification election through a motion
to dismiss filed by an employer? Same issues in module
Med-Arbiter finding of lack of personality of KWFU, to wit: Since petitioner’s Ruling: (Long History)
members are mixture of rank and file and supervisory employees,
petitioner union, at this point [in] time, has not attained the status of a Short version: R.A. No. 9481 took effect only on June 14, 2007; hence, it
legitimate labor organization. Petitioner should first exclude the applies only to labor representation cases filed on or after said date. As the
supervisory employees from it membership before it can attain the petition for certification election subject matter of the present petition was
status of a legitimate labor organization. The above judgment is supported filed by KFWU on January 24, 2000, R.A. No. 9481 cannot apply to it. There
by the decision of the Supreme Court in the Toyota Case wherein the High may have been curative labor legislations that were given retrospective
Tribunal ruled: effect, but not the aforecited provisions of R.A. No. 9481, for otherwise,
substantive rights and interests already vested would be impaired in the
"As respondent union’s membership list contains the names of at least process.
twenty seven (27) supervisory employees in Level Five Positions, the union
could not prior to purging itself of its supervisory employee members, attain Instead, the law and rules in force at the time of the filing by KFWU of the
the status of a legitimate labor organization. Not being one, it cannot possess petition for certification election on January 24, 2000 are R.A. No.
the requisite personality to file a petition for certification election." 6715, amending Book V of Presidential Decree (P.D.) No. 442 (Labor Code), as
amended, and the Rules and Regulations Implementing R.A. No. 6715, as
Furthermore, the commingling of rank and file and supervisory employees in amended by Department Order No. 9, series of 1997.
one (1) bargaining unit cannot be cured in the exclusion-inclusion
proceedings [at] the pre-election conference. The above ruling is supported by Long version: Enactment of RA 875 Sec 3 where mingling was prohibited.
the Decision of the Supreme Court in Dunlop Slazenger (Phils.), Inc. vs. But nothing under the law tells of how the questioned mingling can affect the
Honorable Secretary of Labor and Employment, et al., G.R. No. 131248 dated legitimacy of the labor organization. Under Section 15, the only instance
December 11, 1998 when a labor organization loses its legitimacy is when it violates its duty to
bargain collectively; but there is no word on whether such mingling would
The DOLE held that Med-Arbiter Bactin's reliance on the decisions of the also result in loss of legitimacy.
Court in Toyota Motor Philippines Corporation v. Toyota Motor Philippines
Corporation Labor Union  and Dunlop Slazenger, Inc. v. Secretary of Labor and Lopez v. Chronicle Publication Employees Association, the majority
Employment was misplaced, for while Article 245 declares supervisory pronounced: It may be observed that nothing is said of the effect of such
employees ineligible for membership in a labor organization for rank-and-file ineligibility upon the union itself or on the status of the other qualified
employees, the provision did not state the effect of such prohibited members thereof should such prohibition be disregarded. Considering that
membership on the legitimacy of the labor organization and its right to file for the law is specific where it intends to divest a legitimate labor union of any of
certification election. Neither was such mixed membership a ground for the rights and privileges granted to it by law, the absence of any provision on
cancellation of its registration. the effect of the disqualification of one of its organizers upon the legality of
the union, may be construed to confine the effect of such ineligibility only
CA reversed. Since respondent union clearly consists of both rank and upon the membership of the supervisor. In other words, the invalidity of
file and supervisory employees, it cannot qualify as a legitimate labor membership of one of the organizers does not make the union illegal, where
organization imbued with the requisite personality to file a petition for
the requirements of the law for the organization thereof are, nevertheless, September 15, 1995, respectively; hence, the 1989 Rules was applied in both
satisfied and met. cases. But then, on June 21, 1997, the 1989 Amended Omnibus Rules was
further amended by Department Order No. 9, series of 1997 (1997 Amended
Labor Code was enacted without reproducing Sec 3 of RA 875. Members of Omnibus Rules). Specifically, the requirement under Sec. 2(c) of the 1989
supervisory unions who do not fall within the definition of managerial Amended Omnibus Rules - that the petition for certification election indicate
employees shall become eligible to join or assist the rank and file that the bargaining unit of rank-and-file employees has not been mingled
organization. The determination of who are managerial employees and who with supervisory employees - was removed. Instead, what the 1997 Amended
are not shall be the subject of negotiation between representatives of Omnibus Rules requires is a plain description of the bargaining unit.
supervisory union and the employer. If no agreement s reached between the
parties, either or both of them ma bring the issue to the nearest Regional Tagaytay Highlands Int’l. Golf Club, Inc. v. Tagaytay Highlands Employees
Office for determination. Bulletin v. Sanchez: supervisory employees who do Union-PGTWO abandoned Toyota and Dunloop. The Court held that after a
not fall under the category of managerial employees may join or assist in the labor organization has been registered, it may exercise all the rights and
formation of a labor organization for rank-and-file employees, but they may privileges of a legitimate labor organization. Any mingling between
not form their own labor organization. supervisory and rank-and-file employees in its membership cannot affect its
legitimacy for that is not among the grounds for cancellation of its
R.A. No. 6715 restored the prohibition against the questioned mingling in one registration, unless such mingling was brought about by misrepresentation,
labor organization. Unfortunately, just like R.A. No. 875, R.A. No. 6715 false statement or fraud under Article 239 of the Labor Code.
omitted specifying the exact effect any violation of the prohibition would
bring about on the legitimacy of a labor organization.  was the Rules and San Miguel Corp. (Mandaue Packaging Products Plants) v. Mandaue Packing
Regulations Implementing R.A. No. 6715 (1989 Amended Omnibus Rules) Products Plants-San Miguel Packaging Products-San Miguel Corp. Monthlies
which supplied the deficiency by introducing the following amendment to Rank-and-File Union-FFW, the Court explained that since the 1997 Amended
Rule II. Thus, when the issue of the effect of mingling was brought to the fore Omnibus Rules does not require a local or chapter to provide a list of its
in Toyota, the Court, citing Article 245 of the Labor Code, as amended by members, it would be improper for the DOLE to deny recognition to said local
R.A. No. 6715, held: Clearly, based on this provision, a labor organization or chapter on account of any question pertaining to its individual members.
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 Air Philippines Corporation v. Bureau of Labor Relations: Court therein
organization. Not being one, an organization which carries a mixture of reiterated its ruling in Tagaytay Highlands that the inclusion in a union of
rank-and-file and supervisory employees cannot possess any of the disqualified employees is not among the grounds for cancellation, unless
rights of a legitimate labor organization, including the right to file a such inclusion is due to misrepresentation, false statement or fraud under
petition for certification election for the purpose of collective the circumstances enumerated in Sections (a) and (c) of Article 239 of the
bargaining. It becomes necessary, therefore, anterior to the granting of an Labor Code.
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. All said, while the latest issuance is R.A. No. 9481, the 1997 Amended
Omnibus Rules, as interpreted by the Court in Tagaytay Highlands, San
Miguel and Air Philippines, had already set the tone for it. Toyota and Dunlop
In the case at bar, as respondent union's membership list contains the no longer hold sway in the present altered state of the law and the rules.
names of at least twenty-seven (27) supervisory employees in Level Five
positions, the union could not, prior to purging itself of its supervisory
employee members, attain the status of a legitimate labor organization. Not Issue 2: Except when it is requested to bargain collectively, an employer is a
being one, it cannot possess the requisite personality to file a petition for mere bystander to any petition for certification election; such proceeding is
certification election. In Dunlop, in which the labor organization that filed a non-adversarial and merely investigative, for the purpose thereof is to
petition for certification election was one for supervisory employees, but in determine which organization will represent the employees in their collective
which the membership included rank-and-file employees, the Court bargaining with the employer. The choice of their representative is the
reiterated that such labor organization had no legal right to file a certification exclusive concern of the employees; the employer cannot have any partisan
election to represent a bargaining unit composed of supervisors for as long as interest therein; it cannot interfere with, much less oppose, the process by
it counted rank-and-file employees among its members. filing a motion to dismiss or an appeal from it; not even a mere allegation
that some employees participating in a petition for certification election are
actually managerial employees will lend an employer legal personality to
BUT!! It should be emphasized that the petitions for certification election block the certification election. The employer's only right in the proceeding is
involved in Toyota and Dunlop were filed on November 26, 1992 and to be notified or informed thereof.
 Holy Child Catholic School vs. Hon. Sto. Tomas It should be emphasized that the petitions for certification election
involved in Toyota and Dunlop were filed on November 26, 1992 and
Facts: September 15, 1995, respectively; hence, the 1989 Rules was applied in both
On May 31, 2002, a petition for certification election was filed by cases.
private respondent Pinag-Isang Tinig at Lakas ng Anakpawis Holy Child But then, on June 21, 1997, the 1989 Amended Omnibus Rules was
Catholic School Teachers and Employees Labor Union (HCCS-TELUPIGLAS). further amended by Department Order No. 9, series of 1997 (1997 Amended
In its Comment and Position Paper, petitioner raised that the members of the Omnibus Rules).
union are a mixture of managerial, supervisory, and rank-and-file employees Then came Tagaytay Highlands Int'l. Golf Club, Inc. v. Tagaytay
as three (3) are vice-principals, one (1) is a department head/supervisor, and Highlands Employees Union-PTGWO where the core issue was whether
eleven (11) are coordinators. It is likewise a mixture of teaching and non- mingling affects the legitimacy of a labor organization and its right to file a
teaching personnel. It insisted that, for not being in accord with Article 245 petition for certification election. This time, given the altered legal milieu, the
of the Labor Code, private respondent is an illegitimate labor organization Court abandoned the view in Toyota and Dunlop and reverted to its
lacking in personality to file a petition for certification election, as held in pronouncement in Lopez that while there is a prohibition against the
Toyota Motor Philippines Corporation v. Toyota Motor Philippines mingling of supervisory and rank-and-file employees in one labor
Corporation Labor Union and in Dunlop Slazenger (Phils.), Inc. v. Secretary organization, the Labor Code does not provide for the effects thereof.
of Labor and Employment. Thus, the Court held that after a labor organization has been
The med arbiter denied the petition for certification election on the registered, it may exercise all the rights and privileges of a legitimate labor
ground that the bargaining unit is inappropriate. Private respondent organization. Any mingling between supervisory and rank-and-file employees
appealed to the SOLE and the latter reversed the ruling of the med arbiter in its membership cannot affect its legitimacy for that is not among the
and ordered two certification elections, one among teaching personnel and grounds for cancellation of its registration, unless such mingling was brought
another for non- teaching personnel. Petitioner filed a petition for certiorari about by misrepresentation, false statement or fraud under Article 239 of the
before the CA with prayer for Temporary Restraining Order and Preliminary Labor Code. The latest issuance is R.A. No. 9481, the 1997 Amended
Injunction. The CA dismissed the petition and ruled that the vice-principals, Omnibus Rules, as interpreted by the Court in Tagaytay Highlands, San
coordinators and department heads are not managerial nor supervisory Miguel and Air Philippines, had already set the tone for it. Toyota and Dunlop
employees. Anent the alleged mixture of teaching and non-teaching no longer hold sway in the present altered state of the law and the rules.
personnel, the CA agreed with petitioner that the nature of the members’ In case of alleged inclusion of disqualified employees in a union, the
work does not coincide with that of the latter. proper procedure for an employer like petitioner is to directly file a petition
for cancellation of the unions certificate of registration due to
Petitioner filed a motion for reconsideration but the same was denied. Hence, misrepresentation, false statement or fraud under the circumstances
this petition before the SC. enumerated in Article 239 of the Labor Code, as amended.To reiterate,
private respondent, having been validly issued a certificate of registration,
Issue:  should be considered as having acquired juridical personality which may not
Did the CA err in allowing the conduct of certification election? be attacked collaterally.
Petitioner appears to have confused the concepts of membership in a
Held:  bargaining unit and membership in a union. A bargaining unit is a group of
No. The SC upheld the correctness of the CA Decision. employees sought to be represented by a petitioning union. Such employees
When the issue of the effect of mingling was brought before the Court need not be members of a union seeking the conduct of a certification
in the case of Toyota, the Court, citing Article 245 of the Labor Code, as election. A union certified as an exclusive bargaining agent represents not
amended by R.A. No. 6715, held that a labor organization composed of both only its members but also other employees who are not union members.
rank-and-file and supervisory employees is not a labor organization at all. It It should be stressed that in the subject petition, private respondent
cannot, for any guise or purpose, be a legitimate labor organization. Not union sought the conduct of a certification election among all the rank-and-
being one, an organization which carries a mixture of rank-and-file and file personnel of petitioner school. Since the decision of the Supreme Court in
supervisory employees cannot possess any of the rights of a legitimate labor the U.P. case prohibits us from commingling teaching and non-teaching
organization, including the right to file a petition for certification election for personnel in one bargaining unit, they have to be separated into two separate
the purpose of collective bargaining. bargaining units with two separate certification elections to determine
In the Dunlop case, where the labor organization that filed a petition whether the employees in the respective bargaining units desired to be
for certification election was one for supervisory employees, but in which the represented by private respondent. 
membership included rank-and-file employees, the Court reiterated that Petition was denied.
such labor organization had no legal right to file a certification election to
represent a bargaining unit composed of supervisors for as long as it counted
rank-and-file employees among its members.
PICOP RESOURCES, INCORPORATED (PRI), REPRESENTED IN THIS - Article 256 and not Article 253, of the Labor Code applied in this
PETITION BY MR. WILFREDO D. FUENTES, IN HIS CAPACITY AS case.
SENIOR VICE-PRESIDENT AND RESIDENT MANAGER, PETITIONER, VS.
RICARDO DEQUILLA, ELMO PABILANDO, CESAR ATIENZA AND ISSUE:
ANICETO ORBETA, JR., AND NAMAPRI-SPFI, RESPONDENTS.
WHETHER [OR NOT] AN EXISTING COLLECTIVE BARGAINING
MENDOZA, J. AGREEMENT (CBA) CAN BE GIVEN ITS FULL FORCE AND EFFECT IN
ALL ITS TERMS AND CONDITIONS INCLUDING ITS UNION SECURITY
FACTS: CLAUSE, EVEN BEYOND THE 5-YEAR PERIOD WHEN NO NEW CBA HAS
YET BEEN ENTERED INTO? No, automatic renewal only pertains to the
Ricardo Dequilla, Cesar Atienza and Aniceto Orbeta were regular economic provisions and not the representational provisions. Employer is
rank-and-file employees of Picop Resources, Inc. and members of the only constrained to recognize the majority status of the incumbent
NAMAPRI-SPFL, a duly registered labor organization and existing bargaining bargaining agent if there is not petition for certification election filed.
agent of the PICOP rank-and-file employees. PICOP and NAMAPRI-SPFL had
a CBA which would expire on May 22, 2000. WHETHER OR NOT ARITICLE 253 OR ARTICLE 256 WILL BE
APPLIED? Article 256
On May 16, 2000, Atty. Fuentes, then National President of the
Southern Philippines Federation of Labor, advised the PICOP management to RULING:
terminate about 800 employees due to acts of disloyalty, specifically, for
allegedly campaigning, supporting and signing a petition for the certification There is no question that in the CBA entered into by the parties,
of a rival union, the Federation of Free Workers Union before the 60-day there is a union security clause.
"freedom period" and during the effectivity of the CBA. Such acts of disloyalty
were construed to be a valid cause for termination under the terms and
conditions of the CBA. Based on the CBA, the freedom period would start on - "Union security" - agreement which imposes upon employees the
March 22, 2000. obligation to acquire or retain union membership as a condition
affecting employment
Enraged at what management did to them, private respondents filed
a complaint before the NLRC Regional Arbitration Branch No. XIII, Butuan - Union shop - when all new regular employees are required to join the
City, for Unfair Labor Practice and Illegal Dismissal with money claims, union within a certain period as a condition for their continued
damages and attorney's fees. employment

LA: declaring as illegal the termination of the private respondents. - Closed shop - agreement between the employer and his employees or
their representatives, no person may be employed in any or certain
agreed departments of the enterprise unless he or she is, becomes,
NLRC: initially dismissed the appeal but due to MR new judgment is and, for the duration of the agreement, remains a member in good
rendered DISMISSING the above-entitled case for lack of merit. standing of a union entirely comprised of or of which the employees
in interest are a part.
CA: CA rendered the subject decision reversing and setting aside the
December 27, 2002 NLRC resolution and reinstating the June 9, 2001 When an employer exercises its power to terminate an employee by
Decision of the LA enforcing the union security clause, it needs to determine and prove the
following: (1) the union security clause is applicable; (2) the union is
- Although private respondents signed an authorization for the filing of requesting for the enforcement of the union security provision in the CBA;
the petition for certification election of a rival union, PICOP and (3) there is sufficient evidence to support the decision of the union to
Democratic Trade Unionist-Federation of Free Workers , such act expel the employee from the union.
was not a sufficient ground to terminate the employment of private
respondents The acts of private respondents are not enough proof of a violation of
the Union Security Clause which would warrant their dismissal. PICOP failed
to show in detail how private respondents campaigned and supported FFW.
The act of "signing an authorization for a petition for certification election" is
not disloyalty to the union per se considering that the petition for
certification election itself was filed during the freedom period which started
on March 22, 2000. We are constrained to believe that an "authorization
letter to file a petition for certification election" is different from an actual
"Petition for Certification Election."

Strictly speaking, what is prohibited is the filing of a petition for

certification election outside the 60-day freedom period. This is not the
situation in this case. If at all, the signing of the authorization to file a
certification election was merely preparatory to the filing of the petition for
certification election, or an exercise of respondents' right to self-organization.

Petitioner's reliance on Article 253 is misplaced.

- While it is incumbent for the employer to continue to recognize the

majority status of the incumbent bargaining agent even after the
expiration of the freedom period, they could only do so when no
petition for certification election was filed.

- following Article 256, at the expiration of the freedom period, PRI's

obligation to recognize NAMAPRI-SPFL as the incumbent bargaining
agent does not hold true when petitions for certification election were
filed, as in this case.

- last sentence of Article 253 which provides for automatic

renewal pertains only to the economic provisions of the CBA,
and does not include representational aspect of the CBA.

- An existing CBA cannot constitute a bar to a filing of a petition for

certification election. When there is a representational issue, the
status quo provision in so far as the need to await the creation of a
new agreement will not apply. Otherwise, it will create an absurd
situation where the union members will be forced to maintain
membership by virtue of the union security clause existing under the
CBA and, thereafter, support another union when filing a petition for
certification election.
G.R. No. 177524, July 23, 2014  The NLRC reversed the LA's decision and considered the specified
NATIONAL UNION OF WORKERS IN HOTEL RESTAURANT AND ALLIED entries/transactions as "service chargeable (food & beverage, etc.)"
INDUSTRIES (NUWHRAIN-APL-IUF), PHILIPPINE PLAZA CHAPTER,
PETITIONER, VS. PHILIPPINE PLAZA HOLDINGS, INC., RESPONDENT. CA’s DECISION:
FACTS:  The CA granted the PPHI's petition in its January 31, 2007 decision.
 On November 24, 1998, the PPHI and the Union executed the "Third [19] It affirmed the LA's decision but ordered the PPHI to pay the
Rank-and-File Collective Bargaining Agreement as Amended" (CBA). Union the amount of P80,063.88 as service charges that it found was
 The CBA provided, among others, for the collection, by the PPHI, of a due under the circumstances.
ten percent (10%) service charge on the sale of food, beverage,
transportation, laundry and rooms. ISSUE/S:
 Provisions read as follows: WON there were service charges due according to the CBA
SECTION 68. COLLECTION. The HOTEL shall continue to collect ten RULING:
percent (10%) service charge on the sale of food, beverage,  If the terms of the CBA are plain, clear and leave no doubt on
transportation, laundry and rooms except on negotiated contracts and the intention of the contracting parties, the literal meaning of
special rates. [Emphasis supplied] its stipulations, as they appear on the face of the contract,
shall prevail. Only when the words used are ambiguous and
SECTION 69. DISTRIBUTION. The service charge to be distributed doubtful or leading to several interpretations of the parties'
shall consist of the following: agreement that a resort to interpretation and construction is
called for.
Effective Food & Beverage Rm, Transpo, & Valet
1998 95% 100% On Sec. 68 of the CBA
1997 95% 100%  Following the wordings of Section 68 of the CBA, three requisites
 On February 25, 1999, the Union's Service Charge Committee must be present for the provisions on service charges to operate: (1)
informed the Union President, through an audit report (1st audit the transaction from which service charge is sought to be collected is
report),[8] of uncollected service charges for the last quarter of 1998 a sale; (2) the sale transaction covers food, beverage, transportation,
amounting to P2,952,467.61. laundry and rooms; and (3) the sale does not result from negotiated
 Through a letter dated June 9, 1999, the PPHI admitted liability for contracts and/or at special rates.
P80,063.88 out of the P2,952,467.61 that the Union claimed as  The CBA does not specifically define the terms "negotiated contracts"
uncollected service charges. PPHI however denied the rest of the and "special rates." Nonetheless, the CBA likewise does not explicitly
Unions claims. limit the use of these terms to specified transactions.
 During the July 12, 1999 LMCM, the Union maintained its position  A constricted interpretation of this term, i.e., as applicable to
on uncollected service charges so that a deadlock on the issue "airlines contracts" only, must be positively shown either by the
ensued. The parties agreed to refer the matter to a third party for the wordings of the CBA or by sufficient evidence of the parties' intention
solution. They considered two options voluntary arbitration or court to limit its application. The Union completely failed to provide
action. support for its constricted reading of the term "negotiated contracts,"
 A second audit was made which reflected the uncollected total of either from the wordings of the CBA or from the evidence.
service charges; P5,566,007.62.  In reversing the NLRC's ruling and denying the Union's claim, the CA
 When the parties failed to reach an agreement, the Union, on May 3, found the specified entries/transactions as either falling under the
2001, filed before the LA (Regional Arbitration Branch of the NLRC) a excepted negotiated contracts and/or special rates or not involving a
complaint[14] for non-payment of specified service charges and sale of food, beverage, etc. Specifically, it considered the entries
unfair labor practices. "Westin Gold Cards Revenue" and "Maxi Media Barter" to be
negotiated contracts or contracts under special rates, and the entries
LA’s DECISION: "Business Promotions" and "Gift Certificates" as contracts that did
 LA dismissed the Union's complaint for lack of merit. not involve a sale of food, beverage, etc. The CA also found no
 The Union failed to prove that the PPHI collected 10% service charges factual and evidentiary basis to support the Union's claim for service
on the specified entries/transactions that could have triggered the charges on the entries "Guaranteed No show" and "F & B Revenue."
PPHI's obligation under this provision.
On Art. 96 of the Labor Code
NLRC’s DECISION:  Article 96 requires the employer to incorporate the amount that
the employees had been receiving as share of the collected
 service charges into their wages. In cases where no service
charges had previously been collected (as where the employer
never had any policy providing for collection of service charges or
had never imposed the collection of service charges on certain
specified transactions), Article 96 will not operate.
 PPHI had not in fact been collecting services charges on the
specified entries/transactions that we pointed out as either
falling under "negotiated contracts" and/or "special rates" or did
not involve a "sale of food, beverage, etc." Accordingly, Article 96
of the Labor Code finds no application in this case; the PPHI did
not abolish or terminate the implementation of any company
policy providing for the collection of service charges on specified
entries/transactions that could have otherwise rendered it liable
to pay an amount representing the covered employees' share in
the alleged abolished service charges.
 G.R. 183798: SEPTEMBER 9, 2015
COCA-COLA BOTTLERS PHILIPPINES, INC. (CCBPI) V. ILOCOS HELD:
PROFESSIONAL AND TECHNICAL EMPLOYEES UNION (IPTEU) As proven by the certification of the IMU President as well as the CBAs
executed between IMU and CCBPI, the 22 employees sought to be
FACTS: represented by IPTEU are not IMU members and are not included in the
CCBPI (Petitioner) is a domestic engaged in the business of selling and CBAs due to reclassification of their positions. If these documents were
manufacturing carbonated soft drinks while IPTEU (Respondent) is a false, the IMU should have manifested its vigorous opposition.
registered labor organization in Ilocos Norte.
SC held that said employees are not members of the IMU due to
The respondent filed for a Certification Election (CE) to represent 22 rank & reclassification of their positions.
file employees of the CCBPI plant. CCBPI, however, prayed for the denial and
dismissal of the petition arguing that some of respondent’s members are Does the status of being a confidential employee bar membership from
supervisory or confidential employees. Hence, they are ineligible for inclusion the collective bargaining unit? Yes, but the employees in this instance
as members of IPTEU. were not categorized as confidential employees. The SC refrained from
categorizing the 22 employees.
A preliminary hearing of the petition was held. The possibility of voluntary
recognition or consent election was not acceded to by CCBPI. The Med- The SC refrained from resolving the issue of whether the 22 are confidential
Arbiter concluded that the members of the union are all rank & file employees or not, as this was a factual issue. SC defers to the findings of fact
employees and granted IPTEU’s petition to exclude said employees from the of the Mediator-Arbiter, the SOLE, and the CA that the 22 are not
existing bargaining units of CCBPI. confidential employees. As to whether the 16 voters sought to be excluded
from the appropriate bargaining unit are confidential employees, such query
In the Pre-election Conference CCBPI and IPTEU mutually agreed to conduct is a question of fact, which is not a proper issue in a petition for review under
the certification election. On Election Day, only 16 of the 22 employees in the Rule 45 of the Rules. This holds true in the present case in view of the
IPTEU list voted. However, no votes were canvassed. CCBPI filed and consistent findings of the Mediator-Arbiter, the SOLE, and the CA.
registered a Protest questioning the conduct and mechanics of the election
and a Challenge to Votes on the ground that the voters are supervisory and In this case, organizational charts, detailed job descriptions, and training
confidential employees. programs were presented by CCBPI before the Mediator-Arbiter, the SOLE,
and the CA. Despite these, the Mediator-Arbiter ruled that employees who
The Mediator-Arbiter denied CCBPI’s challenge to the 16 votes. It found that encounter or handle trade secrets and financial information are not
the voters are rank-and-file employees holding positions that are not automatically classified as confidential employees. It was admitted that
confidential in nature, and who are not, or who used to be, members of Ilocos the subject employees encounter and handle financial as well as physical
Monthlies Union (IMU) due to the reclassification of their positions by CCBPI. production data and other information which are considered vital and
They have been excluded from the CBA entered into by IMU and CCBPI from important from the business operations' standpoint. Nevertheless, it was
1997 to 2005. Consequently, the challenged votes were opened and opined that such information is not the kind of information that is
canvassed. relevant to collective bargaining negotiations and settlement of
grievances as would classify them as confidential employees. The SOLE,
After garnering 14 out of the 16 votes cast, IPTEU was proclaimed as the sole which the CA affirmed, likewise held that the questioned voters do not have
and exclusive bargaining agent of the rank-and-file exempt workers in CCBPI access to confidential labor relations information.
Ilocos Norte Plant.
However, the Court defers to the findings of fact of the Mediator-
CCBPI elevated the case to the SOLE; appeal was denied. The SOLE held Arbiter, the SOLE, and the CA. Certainly, access to vital labor
that, as shown by the certification of the IMU President and the CBAs forged information is an imperative consideration. An employee must assist or
between CCBPI and IMU from 1997 to 2007, the 22 employees sought to be act in a confidential capacity and obtain confidential information
represented by IPTEU are not part of IMU and are excluded from its CBA relating to labor relations policies. Exposure to internal business
coverage. CCBPI filed before the CA a petition for certiorari with prayer for operations of the company is not per se a ground for the exclusion in
temporary restraining order and writ of preliminary injunction. CA denied the bargaining unit.
said petition, as well the MR filed by CCBPI; hence, this petition.

ISSUE:
Are the 22 employees sought to be represented by IPTEU excluded from
the bargaining unit? Yes.
 G.R. 171664: MARCH 6, 2013 There was no showing that it was intentionally implemented to stunt the
BANKARD, INC., v. NATIONAL LABOR RELATIONS COMMISSION - FIRST growth of the union or that Bankard discriminated against, or in any way
DIVISION, PAULO BUENCONSEJO, BANKARD EMPLOYEES UNION- singled out the union members who had availed themselves of the retirement
AWATU package under the MRP.

FACTS: Although the program might have affected the number of union membership
Respondent Bankard Employees Union-AWATU (Union) filed before the because of the employees’ voluntary resignation and availment of the
National Conciliation and Mediation Board (NCMB) its first Notice of Strike package, it does not necessarily follow that Bankard indeed purposely sought
(NOS) alleging commission of unfair labor practices by petitioner Bankard, such a result. It must be recalled that the MRP was implemented as a valid
Inc. (Bankard), to wit: 1) job contractualization; 2) outsourcing/contracting- cost-cutting measure, well within the ambit of the so-called management
out jobs; 3) manpower rationalizing program; and 4) discrimination. prerogatives. Bankard contracted an independent agency to meet business
exigencies. In the absence of any showing that Bankard was motivated by ill
It was alleged that Bankard, Inc. has resorted to job contractualization or will, bad faith or malice, or that it was aimed at interfering with its
outsourcing or contracting out of jobs. Among other programs, it also employees’ right to self-organize, it cannot be said to have committed an act
implemented a Manpower Rationalization Program (MRP), which was an of unfair labor practice.
invitation to the employees to tender their voluntary resignation with
entitlement to separation pay equivalent to at least two months’ salary for ON SANCTIONS
every year of service. Majority of its Phone Center and Service Fulfillment Contracting out of services is an exercise of business judgment or
Division employees availed themselves of the MRP. management prerogative. Absent any proof that management acted in a
malicious or arbitrary manner, the Court will not interfere with the exercise
Respondent Bankard Employees Union-AWATU (Union) contended that of judgment by an employer. Furthermore, bear in mind that ULP is
Bankard committed unfair labor practice (ULP). punishable with both civil and/or criminal sanctions. As such, the party
so alleging must necessarily prove it by substantial evidence. The Union,
Bankard denied that there was ULP or even bad faith on its part in as earlier noted, failed to do this. Bankard merely validly exercised its
bargaining with the Union. It came up with counter-offers to the Union's management prerogative. Not shown to have acted maliciously or arbitrarily,
proposals, but the latter's demands were far beyond what management could no act of ULP can be imputed against it.
give. Nonetheless, Bankard continued to negotiate in good faith until the
Memorandum of Agreement (MOA) re-negotiation. The CBA was
overwhelmingly ratified by the Union members. For said reason, Bankard
contended that there was no bad faith.

ISSUE:
Is there an unfair labor practice from the contracting and reducing of
employees?

RULING:
No. The general principle is that the one who makes an allegation has the
burden of proving it. While there are exceptions to this general rule, in ULP
cases, the alleging party has the burden of proving the ULP; and in order to
show that the employer committed ULP under the Labor Code; substantial
evidence is required to support the claim. Such principle finds justification in
the fact that ULP is punishable with both civil and/or criminal sanctions.

Aside from the bare allegations of the union, nothing in the records strongly
proves that Bankard intended its program, the MRP, as a tool to drastically
and deliberately reduce union membership. Contrary to the findings and
conclusions of both the National Labor Relations Commission (NLRC) and the
Court of Appeals (CA), there was no proof that the program was meant to
encourage the employees to disassociate themselves from the union or to
restrain them from joining any union or organization.
 Eugene S. Arabit, Edgardo C. Sadsad, Lowell C. Funtanoz, Gerardo F. become redundant without explaining why their respective
Punzalan, Freddie M. Mendoza, Emilio B. Belen, Violeta C. Diumano And positions became superfluous in relation to the other positions
MB Finance Employees Association ss. Jardine Pacific Finance, Inc. and employees of the company.
(Redundancy) o CA: The CA found that Jardine’s act of hiring contractual employees in
replacement of the petitioners does not run counter to the argument
that their positions are already superfluous.
FACTS  According to the CA, the hiring of contractual employees is a
 The petitioners in this case were regular employees of Jardine Pacific management prerogative that Jardine has the right to exercise.
Finance, Inc.

Petitioner Position Number of Years

of Service ISSUES AND RULING
Eugene S. Arabit Field Collector 20 years  Whether or not the termination is valid termination? No
Edgardo C. Sadsad Field Collector 3 years o Redundancy and retrenchment:
Lowell C. Funtanoz Field Collector 7 years  Redundancy exists where the services of an employee are in excess
Gerardo F. Field Collector 16 years of what is reasonably demanded by the actual requirements of the
Punzalan enterprise. A position is redundant where it is superfluous
Freddie M. Mendoza Field Collector 20 years  Retrenchment, on the other hand, is used interchangeably with the
Emilio B. Belen Senior Credit Investigator/Field 18 years term “lay-off.”  it is an act of the employer of dismissing employees
Collector- San Pablo Branch because of losses in the operation of a business, lack of work, and
Violeta C. Diumano Senior Accounting 19 years considerable reduction on the volume of his business, a right
Clerk/Documentation Clerk- San consistently recognized and affirmed by the Court
Pablo Branch o THUS redundancy does not need to be always triggered by a decline in
o They were also officers and members of MB Finance Employees the business. Primarily, employers resort to redundancy when the
Association-FFW Chapter. functions of an employee have already become superfluous or in excess
o On the claim of financial losses, Jardine decided to reorganize and of what the business requires.
implement a redundancy program among its employees.   Even if a business is doing well, an employer can still validly dismiss
 The petitioners were among those affected by the redundancy an employee from the service due to redundancy if that employee’s
program. position has already become in excess of what the employer’s
o Jardine thereafter hired contractual employees to undertake the enterprise requires.
functions these employees used to perform. o THUS it is illogical for Jardine to terminate the petitioners’ employment
 The union filed a notice of strike, questioning the termination and replace them with contractual employees.  .
o Also claimed unfair labor practice and discrimination against union  The replacement effectively belies Jardine’s claim that the
members and officers. petitioners’ positions were abolished due to superfluity.
o They eventually came to an agreement where the petitioners would  Redundancy could have been justified if the functions of the
receive redundancy pay without prejudice to their right to question the petitioners were transferred to other existing employees of the
legality of their dismissal with the NLRC. company.
 Jardine paid the petitioners a separation package composed of their  To dismiss the petitioners and hire new contractual employees as
severance pay, plus their grossed up transportation allowance. replacements necessarily give rise to the sound conclusion that the
 Proceedings: petitioners’ services have not really become in excess of what
o LA: Jardine’s business requires. To replace the petitioners who were all
 The hiring of contractual employees to replace the petitioners directly regular employees with contractual ones would amount to a violation
contradicts the concept of redundancy which involves the trimming of their right to security of tenure.
down of the workforce because a task is being carried out by too  Guidelines in implementing redundancy:
many people. o It is a management prerogative
- The LA explained that the company’s action was a circumvention  Should not be done with abuse of discretion or acted on in a
of the right of the petitioners to security of tenure. malicious or arbitrary manner.
 It is not enough for Jardine to simply focus on its losses.  Subject to the caveat that it should not performed in violation of any
- According to the LA, it was error for Jardine to simply lump law and that it is not tainted by any arbitrary or malicious motive on
the part of the employer.
together the seven petitioners as employees whose positions have
 o The employer must use fair and reasonable criteria in the selection of
employees who will be dismissed from employment due to redundancy.
 Such fair and reasonable criteria may include the following, but are
not limited to:
- (a) less preferred status (e.g. temporary employee); (b) efficiency;
and (c) seniority. 
 Jardine did not employ clear criteria when it decided who among its
employees, who held similar positions as the petitioners, should be
removed from their posts because of redundancy.
o For the implementation of a redundancy program to be valid, the
employer must comply with the following requisites:
 (1) written notice served on both the employees and the Department
of Labor and Employment at least one month prior to the intended
date of retrenchment;
 (2) payment of separation pay equivalent to at least one month pay
or at least one month pay for every year of service, whichever is
higher; 
 (3) good faith in abolishing the redundant positions; and
 (4) fair and reasonable criteria in ascertaining what positions are to
be declared redundant and accordingly abolished.
 These last two guidelines are interrelated to ensure good faith in
abolishing redundant positions; the employer must clearly show that
it used fair and reasonable criteria in ascertaining what positions are
to be declared redundant.
- Jardine did not explain why the positions were redundant.
- It never even attempted to discuss the attendant facts and
circumstances that led to the conclusion that the petitioners’
positions had become superfluous and unnecessary to Jardine’s
business requirements. 
 Jardine failed to set the required fair and reasonable criteria in the
termination of the petitioners’ employment, leading to the conclusion that
the termination from the service was arbitrary and in bad faith.
SAN FERNANDO COCA-COLA RANK-AND-FILE UNION (SACORU), On August 26, 2009, however, the resolution of the motion for execution was
represented by its President, ALFREDO R. MARAÑON, ordered deferred and suspended; instead, the issue was treated as an item to
vs. COCA-COLA BOTTLERS PHILIPPINES, INC. (CCBPI) be resolved jointly with the main labor dispute.

Facts: CCBPI, for its part, argued that the new business scheme is basically a
management prerogative designed to improve the system of selling and
On May 29, 2009, the private respondent company, Coca-Cola Bottlers distributing products in order to reach more consumers at a lesser cost with
Philippines., Inc. ("CCBPI") issued notices of termination to twenty seven (27) fewer manpower complement, but resulting in greater returns to investment.
rank-and-file, regular employees and members of the San Fernando Rank-
and-File Union ("SACORU'), collectively referred to as "union members", on SACORU maintained that the termination of the 27 union members is a
the ground of redundancy due to the ceding out of two selling and circumvention of the CBA against the contracting out of regular job positions,
distribution systems, the Conventional Route System  ("CRS') and Mini and that the theory of redundancy as a ground for termination is belied by
Bodega System ("MB") to the Market Execution Partners  ("MEPS''), better the fact that the job positions are contracted out to a "third party
known as "Dealership System". The termination of employment was made provider"; that the termination will seriously affect the union membership
effective on June 30, 2009, but the union members were no longer required because out of 250 members, only 120 members will be left upon plan
to report for work as they were put on leave of absence with pay until the implementation that there is no redundancy because the sales department
effectivity date of their termination. The union members were also granted still exists except that job positions will be contracted out to a sales
individual separation packages, which twenty-two (22) of them accepted, but contractor using company equipment for the purpose of minimizing labor
under protest. costs because contractual employees do not enjoy CBA benefits; that the
contractualization program of the company is illegal because it will render
To SACORU, the new, reorganized selling and distribution systems adopted the union inutile in protecting the rights of its members as there will be more
and implemented by CCBPI would result in the diminution of the union contractual employees than regular employees; and that the redundancy
membership amounting to union busting and to a violation of the Collective program will result in the displacement of regular employees which is a clear
Bargaining Agreement (CBA) provision against contracting out of services or case of union busting.
outsourcing of regular positions; hence, they filed a Notice of Strike with the
National Conciliation and Mediation Board (NCMB) on June 3, 2009 on the The NLRC dismissed the complaint for unfair labor practice and declared as
ground of unfair labor practice, among others. On June 11, 2009, SACORU valid the dismissal of the employees due to redundancy. CA dismissed
conducted a strike vote where a majority decided on conducting a strike. appeal, no grave abuse of discretion by NLRC.

On June 23, 2009, the then Secretary of the Department of Labor and Issue: Whether or not there is Unfair Labor Practice committed by CCBPI?
Employment (DOLE), Marianito D. Roque, assumed jurisdiction over the
labor dispute by certifying for compulsory arbitration the issues raised in the Ruling:
notice of strike. Accordingly, any intended strike or lockout or any concerted
action is automatically enjoined. If one has already taken place, all striking
and locked out employees shall, within twenty-four (24) hours from receipt of In Zambrano v. Philippine Carpet Manufacturing Corp.,23 the Court stated:
this Order, immediately return to work and the employer shall immediately
resume operations and re-admit all workers under the same terms and Unfair labor practice refers to acts that violate the workers' right to organize.
conditions prevailing before the strike. The parties are likewise enjoined from There should be no dispute that all the prohibited acts constituting unfair
committing any act that may further exacerbate the situation." labor practice in essence relate to the workers' right to self-organization.
Thus, an employer may only be held liable for unfair labor practice if it can
Meanwhile, pending hearing of the certified case, SACORU filed a motion for be shown that his acts affect in whatever manner the right of his employees
execution of the dispositive portion of the certification order praying that the to self-organize.
dismissal of the union members not be pushed through because it would
violate the order of the DOLE Secretary not to commit any act that would To prove the existence of unfair labor practice, substantial evidence has to be
exacerbate the situation. presented.
Here, the NLRC found that SACORU failed to provide the required Since the union voted for the conduct of a strike on June 11, 2009, when the
substantial evidence, thus: DOLE Secretary issued the return-to-work order dated June 23, 2009, this
means that the status quo was the employment status of the employees on
The union's charge of ULP against respondent company cannot be upheld. June 10, 2009. This status quo should have been maintained until the NLRC
The union's mere allegation of ULP is not evidence, it must be supported by resolved the dispute in its Resolution dated March 16, 2010, where the NLRC
substantial evidence. ruled that CCBPI did not commit unfair labor practice and that the
redundancy program was valid. This Resolution then took the place of the
return-to-work order of the DOLE Secretary and CCBPI no longer had the
Thus, the consequent dismissal of twenty seven (27) regular members of the duty to maintain the status quo after March 16, 2010.
complainant's union due to redundancy is not per se an act of unfair labor
practice amounting to union busting. For while, the number of union
membership was diminished due to the termination of herein union Given this, the 27 employees are therefore entitled to backwages and other
members, it cannot safely be said that respondent company acted in bad benefits from July 1, 2009 until March 16, 2010, and CCBPI should re-
faith in terminating their services because the termination was not without a compute the separation pay that the 27 employees are entitled taking into
valid reason. consideration that the termination of their employment shall be effective
beginning March 16, 2010.
The CA ruled similarly and found that SACORU failed to support its
allegation that CCBPI committed an unfair labor practice:

SACORU failed to proffer any proof that CCBPI acted in a malicious or

arbitrarily manner in implementing the redundancy program which· resulted
in the dismissal of the 27 employees, and that CCBPI engaged instead the
services of independent contractors. As no credible, countervailing evidence
had been put forth by SACORU with which to challenge the validity of the
redundancy program implemented by CCBPI, the alleged unfair labor
practice acts allegedly perpetrated against union members may not be simply
swallowed. SACORU was unable to prove its charge of unfair labor practice
and support its allegations that the termination of the union members was
done with the end-in-view of weakening union leadership and representation.
There was no showing that the redundancy program was motivated by ill will,
bad faith or malice, or that it was conceived for the purpose of interfering
with the employees' right to self-organize.

The Court accordingly affirms these findings of the NLRC and the CA that
SACORU failed to present any evidence to prove that the redundancy
program interfered with their right to self-organize.

Violation of return to work order.

From the date the DOLE Secretary assumes jurisdiction over a dispute until
its resolution, the parties have the obligation to maintain the status
quo while the main issue is being threshed out in the proper forum - which
could be with the DOLE Secretary or with the NLRC. This is to avoid any
disruption to the economy and to the industry of the employer - as this is the
potential effect of a strike or lockout in an industry indispensable to the
national interest - while the DOLE Secretary or the NLRC is resolving the
dispute.
 Pepsi-Cola Product Phils Inc vs. Molon 3.  The Union undertakes to sign the Quitclaim but subject to the 2nd
paragraph of this Agreement
Facts:
Petitioner Pepsi-Cola Products Philippines, Inc. (Pepsi) is a domestic NLRC Ruling
corporation engaged in the manufacturing, bottling and distribution of soft
It ruled that Pepsi was not guilty of union busting as there was a
drink products. In view of its business, Pepsi operates plants all over the
valid retrenchment, it also declared LEPCEU-ALU's July 23, 1999 strike as
Philippines, one of which is located in Sto. Niño,... Tanauan, Leyte (Tanauan
illegal for having been conducted without legal authority since LEPCEU-ALU
Plant).
was not the certified bargaining agent of the company and it dismissed
Respondents, on the other hand, are members of the Leyte Pepsi- respondents' complaints for illegal dismissal for having been finally settled by
Cola Employees Union-Associated Labor Union (LEPCEU-ALU), a legitimate the parties through the execution of quitclaim documents by the respondents
labor organization composed of rank-and-file employees in Pepsi's Tanauan in favor of Pepsi.
Plant, duly registered with the Department of Labor and Employment.

In 1999, Pepsi adopted a company-wide retrenchment program CA ruling:

denominated as Corporate Rightsizing Program. To commence with its
CA reversed and set aside the NLRC ruling stating that Pepsi was
program, it sent a notice of retrenchment to the DOLE as well as individual
guilty of ULP in the form of union busting as its retrenchment scheme only
notices to the affected employees informing them of their termination from
served to defeat LEPCEU-ALU's right to self-organization. It also pointed out
work. Subsequently, on July 13, 1999, Pepsi notified the DOLE of the initial
that the fact that Pepsi hired twenty-six (26) replacements and sixty-five (65)
batch of forty-seven (47) workers to be retrenched. Among these employees
new employees right after they were retrenched contravenes Pepsi's claim
were six (6) elected officers and twenty-nine (29) active members of the
that the retrenchment was necessary to prevent further losses.
LEPCEU-ALU, including herein respondents.
Issues:
On July 19, 1999, LEPCEU-ALU filed a Notice of Strike before the
National Conciliation and Mediation Board (NCMB) due to Pepsi's alleged acts (1) whether respondents' retrenchment was valid;
of union busting/ULP. It claimed that Pepsi's adoption of the retrenchment
program was designed solely to bust their union so that come freedom (2) whether Pepsi committed ULP in the form of union busting; and
period, Pepsi's company union, the Leyte Pepsi-Cola Employees Union-Union
de Obreros de Filipinas (LEPCEU-UOEF) which was also the incumbent (3)whether respondents' execution of quitclaims amounted to a final
bargaining union at that time would garner the majority vote to retain its settlement of the case.
exclusive bargaining status. Hence, on July 23, 1999, LEPCEU-ALU went on
Ruling:
strike.
As to the first issue, it is provided under Article 297 of the Labor
On July 27, 1999, Pepsi filed before the NLRC a petition to declare
Code, that in order to properly effect a retrenchment, the employer must: (a)
the strike illegal with a prayer for the loss of employment status of union
serve a written notice both to the employees and to the DOLE at least one (1)
leaders and some union members. On even date, then DOLE Secretary
month prior to the intended date of retrenchment; and (b) pay the retrenched
Bienvenido A. Laguesma reffered the labor dispute to the NLRC for
employees separation pay equivalent to one (1) month pay or at least one-half
compulsory arbitration. A return-to-work order was also issued.
(½) month pay for every year of service, whichever is higher.
Eventually, Pepsi and LEPCEU-ALU agreed to settle their labor
In due regard of these requisites, the Court observes that Pepsi had
dispute arising from the company's retrenchment program and thus,
validly implemented its retrenchment program.
executed the Agreement dated September 17, 1999 which contained the
following stipulations: Also, as aptly pointed out by the NLRC, Pepsi's Corporate Rightsizing
Program was a company-wide program which had already been implemented
1.  The union will receive 100% of the separation pay based on the
in its other plants in Bacolod, Iloilo, Davao, General Santos and Zamboanga.
employees' basic salary and the remaining 50% shall be released by
Consequently, given the general applicability of its retrenchment program,
Management after the necessary deductions are made from the concerned
Pepsi could not have intended to decimate LEPCEU-ALU's membership,
employees;
much less impinge upon its right to self-organization, when it employed the
2.  Both parties agree that the release of these benefits is without prejudice same. In fact, it is apropos to mention that Pepsi and its employees entered
to the filing of the case by the Union with the National Labor Relations into a collective bargaining agreement on October 17, 1995 which contained
Commission; a union shop clause requiring membership in LEPCEU-UOEF, the incumbent
bargaining union, as a condition for continued employment. In this regard,
Pepsi had all the reasons to assume that all employees in the bargaining unit
were all members of LEPCEU-UOEF; otherwise, the latter would have already
lost their employment. In other words, Pepsi need not implement a
retrenchment program just to get rid of LEPCEU-ALU members considering
that the union shop clause already gave it ample justification to terminate
them. It is then hardly believable that union affiliations were even considered
by Pepsi in the selection of the employees to be retrenched.

Verily, the foregoing incidents clearly negate the claim that the
retrenchment was undertaken by Pepsi in bad faith.

As to 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. Without
that element, the acts, no matter how unfair, are not unfair labor practices.
The only exception is Article 248(f) [now Article 257(f)]. Mindful of their
nature, the Court did not find any act of union busting or ULP on the part of
Pepsi considering that it retrenched its employees in good faith. As earlier
discussed, Pepsi tried to sit-down with its employees to arrive at mutually
beneficial criteria which would have been adopted for their intended
retrenchment. In the same vein, Pepsi's cooperation during the NCMB-
supervised conciliation conferences can also be gleaned from the records.  
Furthermore, the fact that Pepsi's rightsizing program was implemented on a
company-wide basis dilutes respondents' claim that Pepsi's retrenchment
scheme was calculated to stymie its union activities, much less diminish its
constituency. Therefore, absent any perceived threat to LEPCEU-ALU's
existence or a violation of respondents' right to self-organization as
demonstrated by the foregoing actuations Pepsi cannot be said to have
committed union busting or ULP in this case.

As to the third issue,  the Court found that when respondents

signed the September 1999 quitclaims, they did so with the reasonable
impression that that they were not precluded from instituting a subsequent
action with the NLRC. Accordingly, it cannot be said that the signing of the
September 1999 quitclaims was tantamount to a full and final settlement
between Pepsi and respondents.
Petition was granted, CA decision was reversed and set aside, and
the NLRC decision was sustained.
G.R. No. 201595 (WATER-AFWC). He was elected union President. Other MWEU members
ALLAN M. MENDOZA, Petitioner,vs. OFFICERS OF MANILA WATER were inclined to join WATER-AFWC, but MWEU threatened that they would
EMPLOYEES UNION (MWEU), namely, EDUARDO B. BORELA, not get benefits from the new CBA.
BUENAVENTURA QUEBRAL, ELIZABETH COMETA, ALEJANDRO
TORRES, AMORSOLO TIERRA, SOLEDAD YEBAN, LUIS RENDON, The MWEU leadership submitted a proposed CBA which contained
VIRGINIA APILADO, TERESITA BOLO, ROGELIO BARBERO, JOSE provisions to the effect that in the event of retrenchment, non-MWEU
CASAÑAS, ALFREDO MAGA, EMILIO FERNANDEZ, ROSITA BUENA members shall be removed first, and that upon the signing of the CBA, only
VENTURA, ALMENIO CANCINO, ADELA IMANA, MARIO MANCENIDO, MWEU members shall receive a signing bonus.
WILFREDO MANDILAG, ROLANDO MANLAP AZ, EFREN MONTEMAYOR,
NELSON PAGULAYAN, CARLOS VILLA, RIC BRIONES, and CHITO
BERNARDO, Respondents LA: Filing of the instant case is still premature. Parties shall exhaust first all
the administrative remedies before resorting to compulsory arbitration. Thus,
instant case is referred back to the Union for the General Assembly to act or
FACTS: deliberate complainant’s appeal on the decision of the Executive Board.

Petitioner was a member of the Manila Water Employees Union, a NLRC: We find that this Commission lacks the jurisdictional competence to
DOLE registered labor organization consisting of rank-and- file employees act on this case.
within Manila Water Company. Respondents were MWEU officers during the
period material to this Petition.
CA: The issues are essentially intra-union and inter-union disputes. It is
more of an "interference" by a rival union to ensure the loyalty of its members
MWEU informed petitioner that the union was unable to fully deduct and to persuade non-members to join their union. This is not an actionable
the increased P200.00 union dues from his salary due to lack of the required wrong because interfering in the exercise of the right to organize is itself a
December 2006 check-off authorization from him. Petitioner was warned that function of self-organizing. As long as it does not amount to restraint or
his failure to pay the union dues would result in sanctions upon him. For coercion, a labor organization may interfere in the employees’ right to self-
such failure to pay the union dues, petitioner and several others violated the organization.
MWEU’s Constitution and By-Laws. Notice of hearing was sent to petitioner,
who attended the scheduled hearing. MWEU grievance committee
recommended that petitioner be suspended for 30 days. Petitioner and his As regards petitioner’s other accusations, while We may consider them as
co-respondents took exception to the imposition and indicated their intention falling within the concept of ULP under Article 249(a) and (b), still,
to appeal the same to the General Membership Assembly in accordance with petitioner’s complaint cannot prosper for lack of substantial evidence.
Section 2(g), Article V of the union’s Constitution and By-Laws. MWEU
denied petitioner’s appeal, stating that the prescribed period for appeal had ISSUE:
expired.
Whether the LA has jurisdiction over the case? YES
Petitioner was once more charged with non-payment of union dues.
Petitioner was again penalized with a 30-day suspension and once again Whether the case is a interunion/ intraunion dispute? YES BUT NOT THE
denied the right to appeal. MWEU scheduled an election of officers on ENTIRETY OF THE CASE
September 14, 2007. Petitioner filed his certificate of candidacy for Vice-
President, but he was disqualified for not being a member in good standing
on account of his suspension. RULING:

Petitioner was charged with non-payment of union dues for the third It is true that some of petitioner’s causes of action constitute intra-
time. He did not attend the scheduled hearing. This time, he was meted the union cases cognizable by the BLR under Article 226 of the Labor Code. An
penalty of expulsion from the union, per "unanimous approval" of the intra-union dispute refers to any conflict between and among union
members of the Executive Board. His pleas for an appeal to the General members, including grievances arising from any violation of the rights and
Membership Assembly were once more unheeded. conditions of membership, violation of or disagreement over any provision of
the union’s constitution and by-laws, or disputes arising from chartering or
disaffiliation of the union.
In 2008, during the freedom period and negotiations for a new CBA
with MWC, petitioner joined another union, the Workers Association for
Transparency, Empowerment and Reform, All-Filipino Workers Confederation
 However, petitioner’s charge of unfair labor practices falls within the
original and exclusive jurisdiction of the Labor Arbiters, pursuant to Article
217 of the Labor Code. In addition, Article 247 of the same Code provides
that "the civil aspects of all cases involving unfair labor practices, which may
include claims for actual, moral, exemplary and other forms of damages,
attorney’s fees and other affirmative relief, shall be under the jurisdiction of
the Labor Arbiters."

"In essence, [unfair labor practice] relates to the commission of acts

that transgress the workers’ right to organize. "[A]ll the prohibited acts
constituting unfair labor practice in essence relate to the workers’ right to
self-organization." "[T]he term unfair labor practice refers to that gamut of
offenses defined in the Labor Code which, at their core, violates the
constitutional right of workers and employees to self-organization."

Guaranteed to all employees or workers is the ‘right to self-

organization and to form, join, or assist labor organizations of their own
choosing for purposes of collective bargaining.’ The right of self-organization
includes the right to organize or affiliate with a labor union or determine
which of two or more unions in an establishment to join, and to engage in
concerted activities with co-workers for purposes of collective bargaining
through representatives of their own choosing, or for their mutual aid and
protection.

As members of the governing board of MWEU, respondents are

presumed to know, observe, and apply the union’s constitution and by-laws.
Thus, their repeated violations thereof and their disregard of petitioner’s
rights as a union member – their inaction on his two appeals which resulted
in his suspension, disqualification from running as MWEU officer, and
subsequent expulsion without being accorded the full benefits of due process
– connote willfulness and bad faith, a gross disregard of his rights thus
causing untold suffering, oppression and, ultimately, ostracism from MWEU.
"Bad faith implies breach of faith and willful failure to respond to plain and
well understood obligation.
G.R. NO. 169254. AUGUST 23, 2012  WON DLSU is liable for ULP when it refused to collectively bargain
DLSU V. DLSU EMPLOYEES with DLSU-NAFTEU in light of the intra-union dispute
FACTS:
 On May 30, 2000, some of DLSU Employees Association members RULING:
headed by Belen Aliazas (the Aliazas faction) filed a petition for the  An intra-union dispute in this case is not a valid reason to suspend
election of union officers in the Bureau of Labor Relations (BLR). collective bargaining between respondent and petitioner.
 The Aliazas faction allege that there has been no election for  DLSU erred in suspending collective bargaining negotiations with the
DLSUEA-NAFTEUs officers since 1992 in supposed violation of the union and in placing the union funds in escrow considering that the
unions constitution and by-laws which provided for an election of intra-union dispute between the Aliazas and Baz factions was not a
officers every three years. justification therefor is binding herein.
 DLSUEA-NAFTEU repeatedly voted to approve the hold-over of the  The law of the case has been defined as the opinion delivered on a
previously elected officers led by Baylon Baz (Baz faction). former appeal. It means that whatever is once irrevocably established
 When the matter was eventually elevated to the BLR Director, the as the controlling legal rule or decision between the same parties in
latter ruled that the Baz factions tenure in office is valid and the same case continues to be the law of the case, whether correct on
subsisting until their successors have been duly elected and general principles or not, so long as the facts on which such decision
qualified. was predicated continue to be the facts of the case before the court.
 DLSUEA-NAFTEU entered into a five-year CBA with De La Salle  The fact remains that from its receipt of the July 28, 2003 Decision
University (DLSU). The Aliazas faction wrote a letter to DLSU of the Secretary of Labor in OS-AJ-0015-2003 until its receipt of the
requesting it to place in escrow the union dues and other fees November 17, 2003 Decision of the Secretary of Labor in OS-AJ-
deducted from the salaries of employees pending the resolution of the 0033-2003, petitioner failed in its duty to collectively bargain with
intra-union conflict. respondent union without valid reason. DENIED.

LA’S DECISION
 DLSUEA-NAFTEU filed a complaint for unfair labor practice in the
NLRC alleging that DLSU violated Article 248(a) and (g) of the Labor
Code; the creation of escrow accounts was not an act of neutrality as
it was influenced by the Aliazas factionss letter and was an act of
interference with the internal affairs of the union.
 The Labor Arbiter dismissed the complaint for unfair labor practice.
 DLSUEA-NAFTEU sent a letter to DLSU requesting for the
renegotiation of the economic terms for the fourth and fifth years of
the then current CBA. DLSU denied the request prompting DLSUEA-
NAFTEU to file a notice of strike.

SOLE’s DECISION:
 The Secretary of Labor assumed jurisdiction and found DLSU
guilty of unfair labor practice.
 Consequently, DLSUEA-NAFTEU reiterated its demand on DLSU
to bargain collectively; again DLSU declined the request.
 Thus, DLSUEA-NAFTEU filed another notice of strike. The
Secretary of Labor cited his earlier decision. In accordance with
the said decision, DLSU turned over to DLSUEA-NAFTEU the
collected union dues and agency fees from employees which were
previously placed in escrow.

CA’s DECISION:
 DLSU appealed to the Court of Appeals (CA). The CA dismissed the
petition.

ISSUE/S:
 REN TRANSPORT CORP. AND/OR REYNALDO PAZCOGUIN III v. 2.Was the decision rendered by the NLRC is valid on account of its
NATIONAL LABOR RELATIONS COMMISSION, et.al. failure to pass upon all the errors assigned by Ren Transport? YES
G.R. No. 188020, June 27, 2016 3. Is SMART entitled to moral damages? NO.
JURISPRUDENCE:
FACTS:
- Samahan ng Manggagawa sa Ren Transport (SMART) is a registered 1. YES, Ren Transport committed acts of unfair labor practice. Ren
union, which had a five-year CBA with Ren Transport Corp. (Ren Transport violated its duty to bargain collectively with SMART.
Transport) set to expire on December 31, 2004.
- The 60-day freedom period of the CBA passed without a challenge to Violation of the duty to bargain collectively is an unfair labor
SMART'S majority status as bargaining agent. practice under Article 258(g) of the Labor Code.
- SMART thereafter conveyed its willingness to bargain with Ren
Transport, to which it sent bargaining proposals. It bears stressing that Ren Transport had a duty to bargain collectively
- Ren Transport, however, failed to reply to the demand. with SMART. Under Article 263 in relation to Article 267 of the Labor Code, it
- Subsequently, two members of SMART wrote to the DOLE-NCR. The is during the freedom period — or the last 60 days before the expiration of
office was informed that a majority of the members of SMART had the CBA — when another union may challenge the majority status of the
decided to disaffiliate from their mother federation to form another bargaining agent through the filing of a petition for a certification election. If
union, Ren Transport Employees Association (RTEA). there is no such petition filed during the freedom period, then the employer
- SMART contested the alleged disaffiliation. "shall continue to recognize the majority status of the incumbent bargaining
- During the pendency of the disaffiliation dispute at the DOLE-NCR, agent where no petition for certification election is filed."
Ren Transport stopped the remittance to SMART of the union dues
that had been checked off from the salaries of union workers as In the present case, the facts are not up for debate. No petition for
provided under the CBA. certification election challenging the majority status of SMART was filed
- On 19 April 2005, Ren Transport voluntarily recognized RTEA as the during the freedom period, which was from November 1 to December 31,
sole and exclusive bargaining agent of the rank-and-file employees of 2004 — the 60-day period prior to the expiration of the five-year CBA.
their company. SMART therefore remained the exclusive bargaining agent of the rank-and-
file employees.
- SMART filed with the labor arbiter a complaint for unfair labor
practice against Ren Transport.
Given that SMART continued to be the workers' exclusive bargaining
- LABOR ARBITER: Rendered a decision finding Ren Transport guilty
agent, Ren Transport had the corresponding duty to bargain collectively with
of acts of unfair labor practice. The LA explained that since the
the former. Ren Transport's refusal to do so constitutes an unfair labor
disaffiliation issue remained pending, SMART continued to be the
practice.
certified collective bargaining agent; hence, Ren Transport's refusal
to send a counter-proposal to SMART was not justified. The labor
Consequently, Ren Transport cannot avail itself of the defense that
arbiter also held that the company's failure to remit the union dues
SMART no longer represents the majority of the workers. The fact that no
to SMART and the voluntary recognition of RTEA were clear
petition for certification election was filed within the freedom period
indications of interference with the employees' exercise of the right to
prevented Ren Transport from challenging SMART'S existence and
self-organize.
membership.
- NLRC: affirmed the labor arbiter's finding of unfair labor practice on
the part of Ren Transport. Union dues were ordered remitted to Moreover, it must be stressed that, according to the labor arbiter, the
SMART. The NLRC also awarded moral damages to SMART, saying purported disaffiliation from SMART was nothing but a convenient, self-
that Ren transport's refusal to bargain was inspired by malice or bad serving excuse. This factual finding, having been affirmed by both the CA and
faith. The precipitate recognition of RTEA evidenced such bad faith, the NLRC, is now conclusive upon the Court. We do not see any patent error
considering that it was done despite the pendency of the disaffiliation that would take the instant case out of the general rule.
dispute at the DOLE-NCR.
- COURT OF APPEALS: Partially granted the petition. It deleted the Ren Transport interfered with the exercise of the employees' right
award of moral damages to SMART, but affirmed the NLRC decision to self-organize.
on all other matters. The CA ruled that SMART, as a corporation,
was not entitled to moral damages. Interference with the employees' right to self-organization is considered
an unfair labor practice under Article 258 (a) of the Labor Code. In this case,
ISSUES: the labor arbiter found that the failure to remit the union dues to SMART
1. Did Ren Transport commit acts of unfair labor practice? YES and the voluntary recognition of RTEA were clear indications of interference
with the employees' right to self-organization. It must be stressed that this not automatic. The claimant must still prove the factual basis of the damage
finding was affirmed by the NLRC and the CA; as such, it is binding on the and the causal relation to the defendant's acts. In this case, while there is a
Court, especially when we consider that it is not tainted with any blatant showing of bad faith on the part of the employer in the commission of acts of
error. As aptly pointed out by the labor arbiter, these acts were ill-timed in unfair labor practice, there is no evidence establishing the factual basis of
view of the existence of a labor controversy over membership in the union. the damage on the part of SMART.

2. YES, The NLRC decision is valid.

Section 14, Article VIII of the 1987 Constitution, states that "no decision
shall be rendered by any court without expressing therein clearly and
distinctly the facts and the law on which it is based." It has been held that
the constitutional provision does not require a "point-by-point consideration
and resolution of the issues raised by the parties."

In the present case, the decision shows that the NLRC resolved the focal
issue raised by Ren Transport: whether or not SMART remained the exclusive
bargaining agent, such that Ren Transport could be found guilty of acts of
unfair labor practice.

The NLRC succeeded in disposing of all the arguments raised by Ren

Transport without going through every argument, as all the assigned errors
hinged on the majority status of SMART. All of these errors were addressed
and settled by the NLRC by finding that SMART was still the exclusive
bargaining agent of the employees of Ren Transport.

As aptly stated by the CA, a court or any other tribunal is not required to
pass upon all the errors assigned by Ren Transport; the resolution of the
main question renders the other issues academic or inconsequential.

At this juncture, it is well to note that addressing every one of the errors
assigned would not be in keeping with the policy of judicial economy.
Judicial economy refers to "efficiency in the operation of the courts
and the judicial system; especially the efficient management of
litigation so as to minimize duplication of effort and to avoid wasting
the judiciary's time and resources."

Salud v. Court of Appeals: Judicial economy is a "strong norm in a

society in need of swift justice." Now, more than ever, the value of brevity in
the writing of a decision assumes greater significance, as we belong to an age
in which dockets of the courts are congested and their resources limited.

3. NO, SMART is not entitled to an award of moral damages.

A corporation is not, as a general rule, entitled to moral damages. Being

a mere artificial being, it is incapable of experiencing physical suffering or
sentiments like wounded feelings, serious anxiety, mental anguish or moral
shock.

Although this Court has allowed the grant of moral damages to

corporations in certain situations, it must be remembered that the grant is
 G.R. 162943: DECEMBER 06, 2010 REUBP and Bayer agreed to sign a new CBA. In response, petitioners
EMPLOYEES UNION OF BAYER PHILS., FFW AND JUANITO S. FACUNDO immediately filed an urgent motion for the issuance of a restraining
VS. BAYER PHILIPPINES, INC. order/injunction before the NLRC and the Labor Arbiter against respondents.

FACTS: Labor Arbiter dismissed EUBPs second ULP complaint for lack of jurisdiction.
Aggrieved by the Labor Arbiters decision to dismiss the second ULP
Petitioner Employees Union of Bayer Philippines (EUBP) is the exclusive complaint, petitioners appealed the said decision, but the NLRC denied the
bargaining agent of all rank-and-file employees of Bayer Philippines. During appeal. The CA sustained both the Labor Arbiter and the NLRCs rulings.
the negotiations, EUBP rejected Bayers proposal resulting in a bargaining
deadlock. Subsequently, EUBP staged a strike, prompting the Secretary of ISSUE:
the DOLE to assume jurisdiction over the dispute. Is the act of the management of Bayer in dealing and negotiating with
Remigio’s group an unfair labor practice despite its validly existing CBA with
Pending the resolution of the dispute, respondent Avelina Remigio and 27 EUBP?
other union members, without any authority from their union leaders,
accepted Bayers’ wage-increase proposal. The DOLE Secretary issued an HELD:
arbitral award ordering EUBP and Bayer to execute a CBA. The petition is partly meritorious.

Meanwhile, the rift between the union leadership and Remigio’s group It must be remembered that a CBA is entered into in order to foster stability
broadened. Six months from the signing of the new CBA, Remigio solicited and mutual cooperation between labor and capital. An employer should not
signatures from union members in support of a resolution containing the be allowed to rescind unilaterally its CBA with the duly certified
decision of the signatories to: (1) disaffiliate from FFW, (2) rename the union bargaining agent it had previously contracted with, and decide to
as Reformed Employees Union of Bayer Philippines (REUBP), (3) adopt a new bargain anew with a different group if there is no legitimate reason for
constitution and by-laws for the union, (4) abolish all existing officer doing so and without first following the proper procedure. If such
positions in the union and elect a new set of interim officers, and (5) behavior would be tolerated, bargaining and negotiations between the
authorize REUBP to administer the CBA between EUBP and Bayer. The said employer and the union will never be truthful and meaningful, and no
resolution was signed by 147 of the 257 local union members. CBA forged after arduous negotiations will ever be honored or be relied
upon.
Both groups sought recognition from Bayer and demanded remittance of the
union dues collected from its rank-and-file members. Bayer responded by This is the reason why it is axiomatic in labor relations that a CBA entered
deciding not to deal with either of the two groups, and by placing the union into by a legitimate labor organization that has been duly certified as the
dues collected in a trust account until the conflict between the two groups is exclusive bargaining representative and the employer becomes the law
resolved. between them. Additionally, in the Certificate of Registration issued by the
DOLE, it is specified that the registered CBA serves as the covenant between
EUBP filed a complaint for unfair labor practice (first ULP complaint) against the parties and has the force and effect of law between them during the
Bayer for non-remittance of union dues. While the ULP case was still pending period of its duration. Compliance with the terms and conditions of the CBA
and despite EUBPs repeated request for a grievance conference, Bayer is mandated by express policy of the law primarily to afford protection to
decided to turn over the collected union dues to REUBP. labor and to promote industrial peace. Thus, when a valid and binding CBA
had been entered into by the workers and the employer, the latter is
Aggrieved by the said development, EUBP lodged a complaint against behooved to observe the terms and conditions thereof bearing on union
Remigios group before the Industrial Relations Division of the DOLE praying dues and representation. If the employer grossly violates its CBA with
for their expulsion from EUBP for commission of "acts that threaten the life of the duly recognized union, the former may be held administratively and
the union."Labor Arbiter dismissed thefirstULP complaint for lack of criminally liable for unfair labor practice.
jurisdiction.
However, as to respondents Remigio and Villareal, the court finds that
Petitioners filed a second ULP complaint against herein respondents. petitioner’s complaint was validly dismissed. The ULP complaint cannot
Petitioners complained that Bayer refused to remit the collected union dues prosper as against them because the issue essentially involves an intra-
to EUBP despite several demands sent to the management and that the latter union dispute.
opted to negotiate instead with Remigios group.
 Rommel M. Zambrano, et. al. vs Philippine Carpet Manufacturing o There was a valid closure since the company has been suffering
Corporation (Mass Dismissal of all union members; piercing the veil of business losses.
corporate responsibility) o Company also complied with requirements of due process.
 Whether or not there was unfair labor practice? No
o Unfair labor practice refers to acts that violate the workers' right to
FACTS
organize.
 The petitioners in this case were employees of Philippine Carpet
 Thus, an employer may only be held liable for unfair labor practice if
Manufacturing Corporation
it can be shown that his acts affect in whatever manner the right of
o They were notified of their termination on the ground of cessation of
his employees to self-organize.
operations due to serious business losses. o The one who makes an allegation has the burden to prove it. The
o They believed their dismissal was without just cause and in violation of
petitioners in this case were unable to prove that Phil Carpet committed
due process because the closure of Phil Carpet was a mere pretense to acts which constitute unfair labor practice.
transfer its operations to its wholly owned and controlled corporation,
 Whether or not Pacific Carpet can inherit the obligaitons of Phil Carpet? No
Pacific Carpet Manufacturing Corporation
o Pacific Carpet has a personality separate and distinct from Phil Carpet.
 Basis: job orders of some regular clients of Phil Carpet were
o A corporation is an artificial being created by operation of law. It
transferred to Pacific Carpet; and from October to November 2011,
several machines were moved from the premises of Phil Carpet to possesses the right of succession and such powers, attributes, and
Pacific Carpet properties expressly authorized by law or incident to its existence. It
 Dismissal constitutes unfair labor practice since it involved mass has a personality separate and distinct from the persons composing it,
dismissal of all union officers and members of the Philippine Carpet as well as from any other legal entity to which it may be related.
Manufacturing Employees Association (PHILCEA).  Except: the corporate mask may be removed or the corporate veil
pierced when the corporation is just an alter ego of a person or of
 Phil Carpet countered that it permanently closed and totally ceased its
another corporation.
operations because there had been a steady decline in the demand for its
o The doctrine of piercing the corporate veil applies only in three (3) basic
products due to global recession, stiffer competition, and the effects of a
changing market. areas, namely:
o Incurred huge losses based on the audits of SGV and Co.  1) defeat of public convenience as when the corporate fiction is used
as a vehicle for the evasion of an existing obligation;
o The company implemented several cost-cutting measures, including
 2) fraud cases or when the corporate entity is used to justify a
voluntary redundancy and early retirement programs.
wrong, protect fraud, or defend a crime; or
o Business continued to decline, thus the Board of Directors decided to
 3) alter ego cases, where a corporation is merely a farce since it is a
cease operations. mere alter ego or business conduit of a person, or where the
o They also complied with the requisites for closure or cessation of a corporation is so organized and controlled and its affairs are so
business. conducted as to make it merely an instrumentality, agency, conduit
 Proceedings: or adjunct of another corporation.
o LA: dismissed the cases for illegal dismissal and unfair labor practices. o Three-pronged test to determine the application of the alter ego theory,
 Termination was due to total cessation of the operations of Philippine which is also known as the instrumentality theory
Carpet due to business losses.  1) Control, not mere majority or complete stock control, but complete
 Closure was truly dictated by economic necessity as evidenced by its domination, not only of finances but of policy and business practice
audited financial statements. in respect to the transaction attacked so that the corporate entity as
o NLRC: affirmed decision of LA to this transaction had at the time no separate mind, will or
o CA: total cessation of Phil Carpet's manufacturing operations was not existence of its own;
made in bad faith because the same was clearly due to economic  (2) Such control must have been used by the defendant to commit
necessity. fraud or wrong, to perpetuate the violation of a statutory or other
positive legal duty, or dishonest and unjust act in contravention of
plaintiff's legal right; and
ISSUES AND RULING
 (3) The aforesaid control and breach of duty must have proximately
 Whether or not there was valid dismissal? Yes – authorized cause. caused the injury or unjust loss complained of.
o Article 298 of the Labor Code states that closure or cessation of o None of the tests have been met in this case.
operation of the establishment is an authorized cause for terminating  Ownership of a great number of stocks of another corporation is an
an employee. indicia of control, but by itself it does not establish an alter ego
relationship
 Mere ownership by a single stockholder or by another corporation of
all or nearly all of the capital stock of a corporation is not of itself
sufficient ground for disregarding the separate corporate personality
 Existence of interlocking directors, corporate officers and
shareholders is not enough justification to pierce the veil of
corporate fiction in the absence of fraud or other public policy
considerations.
SLORD DEVELOPMENT CORPORATION, vs.BENERANDO M. NOYA While not explicitly mentioned in the Labor Code,  case law recognizes that
dismissal from employment due to the enforcement of the union security
Facts: clause in the CBA is another just· cause for termination of
employment. Similar to the enumerated just causes in the Labor Code, the
violation of a union security clause amounts to a commission of a wrongful
Respondent was employed on September 9, 2008 as a welder by petitioner, a act or omission out of one's own volition; hence, it can be said that the
domestic corporation engaged in the business of manufacturing and dismissal process was initiated not by the employer but by the employee's
processing of sardines and other canned goods.  Respondent's employment indiscretion. Further, a stipulation in the CBA authorizing the dismissal of
was covered by a CBA7 effective April 14, 2009 to April 15, 2014 between employees is of equal import as the statutory provisions on dismissal under
petitioner 'and Nagkakaisang Lakas ng Manggagawa Katipunan (NLM- the Labor Code, since a CBA is the law between the company and the union
Katipunan), the company's sole and exclusive bargaining agent for all the and compliance therewith is mandated by the express policy to give
regular rank-and-file employees.  Among its provisions was a union security protection to labor; thus, there is parallel treatment between just causes and
clause. violation of the union security clause.

Petitioner claimed that sometime in December 2013, respondent asked Pertinent is Article 259 (formerly 248), paragraph (e) of the Labor Code,
several employees to affix their signatures on a blank sheet of yellow paper which states that "[n]othing in this Code or in any other law shall stop the
for the purpose of forming a new union, prompting the president of NLM- parties from requiring membership in a recognized collective bargaining
Katipunan to file expulsion proceedings against him for agent as a condition for employment, except those employees who are already
disloyalty.  Subsequently, or on February 9, 2014, respondent organized a members of another union at the time of the signing of the collective
new union named the Bantay Manggagawa sa SLORD Development bargaining agreement. x x x" The stipulation in a CBA based on this
Corporation (BMSDC), which he registered with the Department of Labor and provision of the Labor Code is commonly known as the "union security
Employment (DOLE) on February 20, 2014. clause."

In the ensuing investigation, respondent failed to appear and participate at "Union security is .a generic term which is applied to and comprehends
the scheduled hearings before the ·union. Thus, NLM-Katipunan 'closed shop,' 'union shop,' 'maintenance of membership' or any other form of
resolved,  with the ratification of its members, to expel respondent on the agreement which imposes upon employees the obligation to acquire or retain
ground of disloyalty. Accordingly, a notice of expulsion dated February 27, union membership as a condition affecting employment. There is union shop
2014 was issued by NLM-Katipunan to respondent. Subsequently, a when all new regular employees are required to join the union within a
letter dated March 16, 2014 was sent by NLM-Katipunan to petitioner, certain period for their continued employment. There is maintenance of
demanding his termination from employment pursuant to the union security membership shop when employees, who are union members as of the
clause of the CBA. After notifying respondent of the union's decision to expel effective date of the agreement, or who thereafter become members, must
him and showing him all the documents attached to the union's demand for maintain union membership as a condition for continued employment until
his dismissal, respondent's employment was terminated on March 19, 2014. they are promoted or transferred out of the bargaining unit, or the agreement
is terminated. A closed shop, on the other hand, may be defined as an
Consequently, respondent filed a complaint  for illegal dismissal, unfair labor enterprise in which, by agreement between the employer and his employees
practice, and illegal deduction against petitioner before the National Labor or their representatives, no person may be employed in any or certain agreed
Relations Commission (NLRC), asserting that he did not violate any CBA departments of the enterprise unless he or she is, becomes, and, for the
provision since he validly organized BMSDC during the freedom period. duration of the agreement, remains a member in good standing of a union
entirely comprised of or of which the employees in interest are a part. "
LA dismissed for lack of merit. NLRC affirmed LA. CA reversed and found no
just cause for the dismissal. This is consistent with the State policy to promote unionism to enable
workers to negotiate with management on an even playing field and with
Issue: Whether or not the employee can be dismissed for non-compliance more persuasiveness than if they were to individually and separately bargain
with union security clause with the employer. Thus, the law has allowed stipulations for "union shop"
and "closed shop" as means of encouraging workers to join and support the
union of their choice in the protection of their rights and interest vis-a-vis the
Ruling: employer. 
To validly terminate the employment of an .employee through the Tanduay Distillery Labor Union v. NLRC: As an act of loyalty, a union may
enforcement of the union ·security clause, the following requisites must require its members not to affiliate with any other labor union and to
concur: (1) the union security clause is applicable; (2) the union is requesting consider its infringement as a reasonable cause for separation, pursuant to
for the enforcement of the union security provision in the CBA; and (3) there the union security clause in its CBA. Having ratified the CBA and being
is sufficient evidence to support the decision of the union to expel the members of the union, union members owe fealty and are required under the
employee from the union. union security clause to maintain their membership in good standing during
the term thereof. This requirement ceases to be binding only during the sixty
In this case, the Court finds the confluence of the foregoing requisites, (60)-day freedom period immediately preceding the expiration of the CBA,
warranting the termination of respondent's employment.1âшphi1 which enjoys the principle of sanctity or inviolability of contracts guaranteed
by the Constitution.
It is undisputed that the CBA contains a closed shop agreement stipulating
that petitioner's employees must join NLM-Katipunan and remain to be a Distribution & Control Products, Inc. v. Santos: procedural due process
member in good standing; otherwise, through a written demand, NLM- consists of the twin requirements of notice and hearing. The employer must
Katipunan can insist the dismissal of an employee. BPI v. BPI Employees furnish the employee with two (2) written notices before the termination of
Union-Davao Chapter-Federation of Uniqns in BPI Unibank: When certain employment can be effected: (1) the first apprises the employee of the
employees are obliged to join a particular union as a requisite for continued particular acts or omissions for which his dismissal is sought; and (2) the
employment, as in the case of Union Security Clauses, this condition is a second informs the employee of the employer's decision to dismiss him. The
valid restriction of the freedom or right not to join any labor organization requirement of a hearing is complied with as long as there was an
because it is in favor of unionism. opportunity to be heard, and not necessarily that an actual hearing was
conducted.
Further, records show that NLM-Katipunan requested the enforcement of the
union security clause by demanding the dismissal of respondent from In the case, petitioner was not accorded ample opportunity to defend himself
employment. In a letter dated March 16, 2014, NLM-Katipunan asked through notice and hearing; hence, entitled to nominal damages of 30k.
petitioner to dismiss respondent from employment for having committed an
act of disloyalty in violation of the CBA's union security clause.
NLMKatipunan explained that respondent solicited support from employees
and thereafter, formed and organized a new union outside the freedom
period, or from February 14, 2014 to April 14, 2014.

Finally, there is sufficient evidence to support the union's decision to expel

respondent. Particularly, NLM-Katipunan presented to petitioner: (a) a
written statement of one Elaine Rosel (Rosel), stating that respondent and
one Henry Cabasa went to her house on December 13, 2013 to convince her
to join in forming another union and.made her sign on a yellow paper; (b) a
joint written statement of Meliorita V. Nolla and Emilda S. Rubido,
corroborating Rosel's claim;  (c) a written statement of one Joselito Gonzales
(Gonzales), attesting to respondent's act of soliciting signatures for the
purpose of forming a new union; (d) an affidavit of NLM-Katipunan President
Lolita Abong, further corroborating Gonzales' statement and formally lodging
a complaint against respondent before the union; and (e) an application for
registration of BMSDC, showing that respondent formed and organized
BMSDC on February 9, 2014.

Review of related jurisprudence:

PICOP case inapplicable because of factual difference:  in this case,

respondent did not only solicit support in the formation of a new union but
actually formed and organized a rival union, BMSDC, outside the freedom
period.